SunTrust Shines Up Balance Sheet Ahead of Wachovia Battle

SunTrust (STI Quote) spent Friday serving up solid second-quarter earnings and saying nasty things about First Union (FTU Quote).

By most accounts, SunTrust delivered a strong quarter, posting a profit of $1.19 a share, 3 cents better than the Thomson Financial/First Call consensus, and 13% higher than the year-ago $1.05. Businesses including mortgage production bolstered the bottom line. SunTrust also moved to shore up its balance sheet against credit quality and interest-rate worries as a proxy fight shapes up with First Union, its rival in the fight for Wachovia (WB Quote).

Nonperforming assets, those that are past due but haven't been written off, jumped 17% from the prior quarter, to $431.4 million. On a conference call with investors and analysts, a SunTrust spokesman said the bulk of the increase was due to two large credits, both of which are in bankruptcy proceedings. The bank identified the companies as Warnaco (WAC Quote) and USG (USG Quote). ...