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BB&T Stock Beauty In the Eye of the Beholder

NEW YORK ( TheStreet) -- There's quite a difference of opinion about BB&T Corp. (BBT - Get Report), which saw its shares drop 8% on Thursday and Friday, after the company on Wednesday reported a solid third quarter.

BB&T of Winston-Salem, N.C., reported third-quarter net income available to common shareholders of $469 million, or 66 cents a share, declining from $510 million, or 72 cents, in the second quarter, but increasing from $366 million, or 52 cents a share, during the third quarter of 2011. The company said that during the third quarter, "earnings were reduced by merger-related charges associated with the acquisition of BankAtlantic totaling $43 million pretax, or $0.04 per diluted common share."

Loan growth was a major highlight for BB&T, with CEO Kelly King saying that "loan growth improved during the quarter as average loans held for investment increased 12.6% on an annualized basis compared to the second quarter including the impact of the BankAtlantic acquisition." Excluding BankAtlantic, "organic loan growth was also strong as average loans increased 8.4% compared to last quarter on an annualized basis," King said, adding that the "growth was led by our other lending subsidiaries, residential mortgage loans, C&I loans and sales finance loans."

BB&T's third-quarter mortgage revenue increased to $211 million, from $182 million the previous quarter, and $123 million a year earlier, following the trend for many large regional banks, as the mortgage refinance wave continues. But the sequential increase in mortgage income was more than offset by a decline in insurance income, to $333 million, from $393 million in the second quarter, although insurance income was up from $241 million a year earlier, factoring-in the company's acquisition of the Crump Group's life, property and casualty businesses in April.

BB&T's third-quarter net interest income was a tax-adjusted $1.52 billion, increasing slightly from the previous quarter, and from $$1.45 billion a year earlier. The company's net interest margin net interest margin (NIM) -- the difference between the average yield on loans and investments and the average cost for deposits and borrowings -- was 3.94%, declining from 3.95% in the second quarter, and 4.09% during the third quarter of 2011.

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