10-Q

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

Quarterly Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934

For the quarterly period ended:

June 30, 2005

Commission file number: 1-10853

BB&T CORPORATION
(exact name of registrant as specified in its charter)

North Carolina	56-0939887
(State of Incorporation)	(I.R.S. Employer Identification No.)
200 West Second Street	27101
Winston-Salem, North Carolina	(Zip Code)
(Address of Principal Executive Offices)

(336) 733-2000
(Registrant's Telephone Number, Including Area Code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.   Yes  [ Ö ]   No  [__]

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).  Yes  [ Ö ]   No  [__]

At July 31, 2005, 547,515,168 shares of the registrant's common stock, $5 par value, were outstanding.

BB&T CORPORATION

FORM 10-Q

June 30, 2005

INDEX

	Page No.
Part I. FINANCIAL INFORMATION
Item 1. Financial Statements (Unaudited)	2
Notes to Consolidated Financial Statements	6
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations	25
Executive Summary	28
Analysis of Financial Condition	29
Analysis of Results of Operations	37
Market Risk Management	50
Capital Adequacy and Resources	54
Item 3. Quantitative and Qualitative Disclosures About Market Risk	56
Item 4. Controls and Procedures	57
Part II. OTHER INFORMATION
Item 1. Legal Proceedings	57
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	57
Item 4. Submission of Matters to a Vote of Security Holders	57
Item 6. Exhibits	58
SIGNATURES	59
EXHIBIT INDEX	60
CERTIFICATIONS	61

BB&T Corporation          Page 1          Second Quarter 2005 10-Q

Item 1. Financial Statements

BB&T CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(Dollars in thousands, except per share data)

	June 30,			December 31,
	2005			2004
Assets
Cash and due from banks	$	2,030,082		$	1,782,323
Interest-bearing deposits with banks		434,772			1,003,125
Federal funds sold, securities purchased under resale agreements
and other earning assets		364,038			240,387
Trading securities at fair value		675,146			334,256
Securities available for sale at fair value		20,123,465			18,838,196
Securities held to maturity at amortized cost (fair value $125 at December 31, 2004)		--			125
Loans held for sale		700,732			613,476
Loans and leases, net of unearned income of $2,514,746 at June 30, 2005 and
$2,540,201 at December 31, 2004		71,039,884			67,549,125
Allowance for loan and lease losses		(809,318	)		(804,932	)
Loans and leases, net		70,230,566			66,744,193
Premises and equipment, net of accumulated depreciation		1,263,467			1,283,546
Goodwill		4,233,719			4,124,241
Core deposit and other intangible assets		535,965			513,539
Other assets		5,243,372			5,031,234
Total assets	$	105,835,324		$	100,508,641
Liabilities and Shareholders' Equity
Deposits:
Noninterest-bearing deposits	$	13,197,792		$	12,246,248
Savings and interest checking		4,641,866			4,490,214
Money rate savings		23,075,292			23,427,797
Certificates of deposit and other time deposits		30,915,409			27,535,078
Total deposits		71,830,359			67,699,337
Federal funds purchased, securities sold under repurchase agreements
and short-term borrowed funds		7,137,762			6,687,872
Long-term debt		11,955,683			11,419,624
Accounts payable and other liabilities		3,821,153			3,827,334
Total liabilities		94,744,957			89,634,167
Commitments and contingencies (Note 6)
Shareholders' equity:
Preferred stock, $5 par, 5,000,000 shares authorized, none issued or
outstanding at June 30, 2005 or at December 31, 2004		--			--
Common stock, $5 par, 1,000,000,000 shares authorized;
546,796,870 issued and outstanding at June 30, 2005, and
550,406,287 issued and outstanding at December 31, 2004		2,733,984			2,752,032
Additional paid-in capital		2,990,484			3,121,716
Retained earnings		5,494,527			5,112,034
Unvested restricted stock		(17	)		(107	)
Accumulated other comprehensive loss, net of deferred income
taxes of $(77,276) at June 30, 2005, and $(66,662) at December 31, 2004		(128,611	)		(111,201	)
Total shareholders' equity		11,090,367			10,874,474
Total liabilities and shareholders' equity	$	105,835,324		$	100,508,641

The accompanying notes are an integral part of these consolidated financial statements.

BB&T Corporation          Page 2          Second Quarter 2005 10-Q

BB&T CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(Dollars in thousands, except per share data)

	For the Three Months Ended					For the Six Months Ended
	June 30,					June 30,
	2005			2004		2005			2004
Interest Income
Interest and fees on loans and leases	$	1,128,331		$	945,561	$	2,181,152		$	1,857,717
Interest and dividends on securities		199,167			171,826		385,955			337,610
Interest on short-term investments		5,186			2,067		9,069			4,576
Total interest income		1,332,684			1,119,454		2,576,176			2,199,903
Interest Expense
Interest on deposits		279,283			172,689		520,582			339,466
Interest on federal funds purchased, securities sold under
repurchase agreements and short-term borrowed funds		58,546			17,968		101,012			35,363
Interest on long-term debt		117,890			89,094		228,434			178,548
Total interest expense		455,719			279,751		850,028			553,377
Net Interest Income		876,965			839,703		1,726,148			1,646,526
Provision for credit losses		49,424			63,533		90,469			126,951
Net Interest Income After Provision for Credit Losses		827,541			776,170		1,635,679			1,519,575
Noninterest Income
Service charges on deposits		139,166			131,445		259,938			254,208
Mortgage banking income		12,367			56,656		42,560			61,075
Trust revenue		36,722			31,519		67,129			61,504
Investment banking and brokerage fees and commissions		81,046			63,624		149,929			140,222
Insurance commissions		181,612			164,712		333,902			288,418
Bankcard fees and merchant discounts		27,738			25,285		53,174			48,130
Other nondeposit fees and commissions		63,820			54,180		118,766			102,969
Securities gains (losses), net		(6	)		2		1			(509	)
Other income		42,454			35,353		76,141			82,246
Total noninterest income		584,919			562,776		1,101,540			1,038,263
Noninterest Expense
Personnel expense		450,730			422,987		865,846			843,262
Occupancy and equipment expense		148,080			103,428		253,824			203,575
Amortization of intangibles		28,611			28,670		56,713			52,726
Professional services		22,594			19,348		38,883			38,756
Loss on early extinguishment of debt		2,943			--		2,943			--
Merger-related and restructuring charges (gains)		(404	)		791		(2,961	)		10,441
Other expense		178,734			165,015		346,746			325,856
Total noninterest expense		831,288			740,239		1,561,994			1,474,616
Earnings
Income before income taxes		581,172			598,707		1,175,225			1,083,222
Provision for income taxes		194,367			198,601		393,036			354,616
Net income	$	386,805		$	400,106	$	782,189		$	728,606
Per Common Share
Net income:
Basic	$	.71		$	.72	$	1.43		$	1.32
Diluted	$	.70		$	.72	$	1.42		$	1.32
Cash dividends paid	$	.35		$	.32	$	.70		$	.64
Weighted Average Shares Outstanding
Basic		547,089,165			554,041,770		548,179,529			550,309,127
Diluted		551,245,112			557,485,680		552,443,239			554,016,363

The accompanying notes are an integral part of these consolidated financial statements.

BB&T Corporation          Page 3          Second Quarter 2005 10-Q

BB&T CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
For the Six Months Ended June 30, 2005 and 2004
(Unaudited)
(Dollars in thousands)

													Accumulated
	Shares of						Additional			Retained			Other			Total
	Common			Common			Paid-In			Earnings			Comprehensive			Shareholders'
	Stock			Stock			Capital			and Other (1)			Income (Loss)			Equity
Balance, January 1, 2004		541,942,987		$	2,709,715		$	2,893,812		$	4,309,325		$	21,879		$	9,934,731
Add (Deduct):
Comprehensive income (loss):
Net income		--			--			--			728,606			--			728,606
Unrealized holding gains (losses) arising during the period
on securities available for sale, net of tax of $(129,284)		--			--			--			--			(239,889	)		(239,889	)
Reclassification adjustment for losses (gains)
on securities available for sale included in net
income, net of tax of $199		--			--			--			--			310			310
Change in unrealized gains (losses) on securities, net of tax		--			--			--			--			(239,579	)		(239,579	)
Change in unrecognized gains (losses) on cash flow hedges,
net of tax of $(14,165)														(21,711	)		(21,711	)
Change in minimum pension liability, net of tax of $(1,625)		--			--			--			--			(3,018	)		(3,018	)
Total comprehensive income (loss)		--			--			--			728,606			(264,308	)		464,298
Common stock issued:
In purchase acquisitions		15,547,445			77,737			513,122			--			--			590,859
In connection with stock option exercises
and other employee benefits, net of cancellations		1,346,333			6,732			17,620			--			--			24,352
Redemption of common stock		(3,498,800	)		(17,494	)		(111,138	)		--			--			(128,632	)
Cash dividends declared on common stock, $.67 per share		--			--			--			(369,584	)		--			(369,584	)
Other, net		--			--			8,598			91			--			8,689
Balance, June 30, 2004		555,337,965		$	2,776,690		$	3,322,014		$	4,668,438		$	(242,429	)	$	10,524,713
Balance, January 1, 2005		550,406,287		$	2,752,032		$	3,121,716		$	5,111,927		$	(111,201	)	$	10,874,474
Add (Deduct):
Comprehensive income (loss):
Net income		--			--			--			782,189			--			782,189
Unrealized holding gains (losses) arising during the
period on securities available for sale, net of tax of
$ (13,290)		--			--			--			--			(21,924	)		(21,924	)
Reclassification adjustment for losses (gains)
on securities available for sale included in net
income, net of tax of $40		--			--			--			--			(41	)		(41	)
Change in unrealized gains (losses) on securities, net of tax		--			--			--			--			(21,965	)		(21,965	)
Change in unrecognized gains (losses) on cash flow hedges,
net of tax of $4,208		--			--			--			--			6,693			6,693
Change in minimum pension liability, net of tax of $(1,572)		--			--			--			--			(2,138	)		(2,138	)
Total comprehensive income (loss)		--			--			--			782,189			(17,410	)		764,779
Common stock issued:
In purchase acquisitions		646,489			3,232			22,068			--			--			25,300
In connection with stock option exercises
and other employee benefits, net of cancellations		1,244,094			6,220			23,887			--			--			30,107
Redemption of common stock		(5,500,000	)		(27,500	)		(185,855	)		--			--			(213,355	)
Cash dividends declared on common stock, $.73 per share		--			--			--			(399,696	)		--			(399,696	)
Other, net		--			--			8,668			90			--			8,758
Balance, June 30, 2005		546,796,870		$	2,733,984		$	2,990,484		$	5,494,510		$	(128,611	)	$	11,090,367

(1) Other includes unvested restricted stock.

The accompanying notes are an integral part of these consolidated financial statements.

BB&T Corporation          Page 4          Second Quarter 2005 10-Q

BB&T CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(Dollars in thousands)

	For the Six Months Ended
	June 30,
	2005			2004
Cash Flows From Operating Activities:
Net income	$	782,189		$	728,606
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for credit losses		90,469			126,951
Depreciation		104,670			79,877
Amortization of intangibles		56,713			52,726
Amortization of purchase accounting mark-to-market adjustments		14,484			14,362
Discount accretion and premium amortization on long-term debt, net		55,026			49,968
Discount accretion and premium amortization on securities, net		23,094			26,360
Net (increase) decrease in trading account securities		(340,890	)		346,884
(Gain) loss on sales of securities, net		(1	)		509
Gain on sales of loans held for sale, net		(37,074	)		(38,167	)
Gain on disposals of premises and equipment, net		(207	)		(339	)
Proceeds from sales of loans held for sale		2,384,603			2,913,470
Purchases of loans held for sale		(358,064	)		(611,749	)
Origination of loans held for sale, net of principal collected		(2,076,721	)		(2,351,855	)
Tax benefit from exercise of stock options		8,567			8,598
Increase in other assets, net		(155,340	)		(60,580	)
(Decrease) increase in accounts payable and other liabilities, net		(27,255	)		139,214
Other, net		6,995			2,398
Net cash provided by operating activities		531,258			1,427,233
Cash Flows From Investing Activities:
Proceeds from sales of securities available for sale		680,924			143,700
Proceeds from maturities, calls and paydowns of securities available for sale		1,429,674			2,153,750
Purchases of securities available for sale		(3,454,119	)		(3,667,689	)
Proceeds from maturities, calls and paydowns of securities held to maturity		125			59,997
Leases made to customers		(129,629	)		(124,073	)
Principal collected on leases		87,608			72,837
Loan originations, net of principal collected		(3,127,155	)		(2,965,591	)
Purchases of loans		(461,426	)		(84,206	)
Net cash (paid) acquired in business combinations		(127,051	)		8,689
Purchases and originations of mortgage servicing rights		(54,021	)		(52,869	)
Proceeds from disposals of premises and equipment		11,652			18,633
Purchases of premises and equipment		(83,650	)		(133,365	)
Proceeds from sales of foreclosed property		30,311			37,280
Proceeds from sales of other real estate held for development or sale		7,307			10,995
Net cash used in investing activities		(5,189,450	)		(4,521,912	)
Cash Flows From Financing Activities:
Net increase in deposits		4,134,290			4,771,954
Net increase (decrease) in federal funds purchased, securities sold under repurchase agreements
and short-term borrowed funds		449,890			(1,186,032	)
Proceeds from issuance of long-term debt		828,359			1,897,000
Repayment of long-term debt		(416,320	)		(2,296,816	)
Net proceeds from common stock issued		30,107			24,352
Redemption of common stock		(213,355	)		(128,632	)
Cash dividends paid on common stock		(384,745	)		(351,127	)
Net cash provided by financing activities		4,428,226			2,730,699
Net Decrease in Cash and Cash Equivalents		(229,966	)		(363,980	)
Cash and Cash Equivalents at Beginning of Period		3,025,835			2,821,967
Cash and Cash Equivalents at End of Period	$	2,795,869		$	2,457,987
Supplemental Disclosure of Cash Flow Information:
Cash paid during the period for:
Interest	$	810,572		$	551,347
Income taxes		414,979			55,146
Noncash investing and financing activities:
Transfer of loans to foreclosed property		23,760			43,758
Transfer of fixed assets to other real estate owned		4,085			4,718
Common stock issued in purchase accounting transactions		25,300			590,859

The accompanying notes are an integral part of these consolidated financial statements.

BB&T Corporation          Page 5          Second Quarter 2005 10-Q

BB&T CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2005
(Unaudited)

NOTE 1. Basis of Presentation

   General

          In the opinion of management, the accompanying unaudited consolidated balance sheets, consolidated statements of income, consolidated statements of changes in shareholders’ equity, and consolidated statements of cash flows of BB&T Corporation and subsidiaries (referred to herein as “BB&T”, “the Corporation” or “the Company”), present fairly, in all material respects, BB&T’s financial position at June 30, 2005 and December 31, 2004; BB&T’s results of operations for the three months and six months ended June 30, 2005 and 2004; and BB&T’s cash flows for the six months ended June 30, 2005 and 2004. In the opinion of management, all adjustments necessary to fairly present the consolidated financial position and consolidated results of operations have been made.

          During the second quarter of 2005, BB&T recorded an adjustment to correct the accounting for property and equipment leases to reflect rent expense on leases with escalating payments on a straight-line basis and to depreciate certain leasehold improvements over the appropriate term. The cumulative impact of the adjustment increased occupancy and equipment expense by $44.0 million, increased other income by $1.0 million, and increased goodwill by $5.4 million, resulting in a net pretax impact of $43.0 million, or a net after-tax impact of $26.6 million. This adjustment results in differences in the timing of expense and revenue recognition and had no impact on the Company’s consolidated cash flows. In addition, the adjustment was not material to any prior periods or to BB&T’s consolidated financial position or projected annual consolidated results of operations. All other adjustments during the quarter were of a normal recurring nature.

          These consolidated financial statements and notes are presented in accordance with the instructions for Form 10-Q. The information contained in the footnotes included in BB&T’s 2004 Annual Report on Form 10-K should be referred to in connection with these unaudited interim consolidated financial statements.

   Nature of Operations

          BB&T is a financial holding company headquartered in Winston-Salem, North Carolina. BB&T conducts its operations primarily through its subsidiary banks, which have branches in North Carolina, South Carolina, Virginia, Maryland, Georgia, West Virginia, Tennessee, Kentucky, Florida, Alabama, Indiana and Washington, D.C. BB&T’s subsidiary banks provide a wide range of banking services to individuals and businesses. BB&T’s subsidiary banks offer a variety of loans to businesses and consumers, including mortgage loans. Such loans are made primarily to individuals residing in the market areas described above or to businesses located within BB&T’s geographic footprint. BB&T’s subsidiary banks also market a wide range of deposit services to individuals and businesses. BB&T’s subsidiary banks offer, either directly, or through their subsidiaries, lease financing to businesses and municipal governments; discount brokerage services, annuities and mutual funds; life insurance, property and casualty insurance, health insurance and commercial general liability insurance on an agency basis and through a wholesale insurance brokerage operation; insurance premium financing; permanent financing arrangements for commercial real estate and provides loan servicing for third-party investors; direct consumer finance loans to individuals; and trust services. The direct nonbank subsidiaries of BB&T provide a variety of financial services including automobile lending, equipment financing, factoring, full-service securities brokerage, payroll processing, asset management and capital markets services.

BB&T Corporation          Page 6          Second Quarter 2005 10-Q

   Principles of Consolidation

          The consolidated financial statements of BB&T include the accounts of BB&T Corporation and those subsidiaries that are majority-owned by BB&T or over which BB&T exercises control. In consolidation, all significant intercompany accounts and transactions have been eliminated. The results of operations of companies acquired in transactions accounted for as purchases are included only from the dates of acquisition. All material wholly-owned and majority-owned subsidiaries are consolidated unless accounting principles generally accepted in the United States of America require otherwise.

          BB&T evaluates variable interests in entities for which voting interests are not an effective means of identifying controlling financial interests. Variable interests are those in which the value of the interest changes with the fair value of the net assets of the entity exclusive of variable interests. If the results of the evaluation indicate the existence of a primary beneficiary and the entity does not effectively disperse risks among the parties involved, that primary beneficiary is required to consolidate the entity. Likewise, if the evaluation indicates that the requirements for consolidation are not met and the entity has previously been consolidated, then the entity would be deconsolidated.

          BB&T has variable interests in certain entities including affordable housing partnership interests, historic tax credit partnerships, other partnership interests and trust preferred securities, none of which were required to be consolidated.

          BB&T generally accounts for unconsolidated partnership investments using the equity method of accounting. In addition to affordable housing partnerships, which represent the majority of unconsolidated investments in variable interest entities, BB&T also has investments and future funding commitments to venture capital entities, small business investment companies and other entities. The maximum potential exposure to losses relative to investments in variable interest entities is generally limited to the sum of the outstanding balance, future funding commitments and any related loans to the entity. Loans to these entities are underwritten in substantially the same manner as are other loans and are generally secured.

          BB&T has investments in certain entities for which BB&T does not have controlling interest. For these investments, the Company records its interest using the equity method with its portion of income or loss being recorded in other noninterest income on the Consolidated Statements of Income. BB&T periodically evaluates these investments for impairment.

BB&T Corporation          Page 7          Second Quarter 2005 10-Q

   Reclassifications

          In certain instances, amounts reported in a prior period’s consolidated financial statements have been reclassified to conform to the current presentation. Such reclassifications had no effect on previously reported shareholders’ equity or net income.

   Use of Estimates in the Preparation of Financial Statements

          The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change relate to the determination of the allowance for loan and lease losses and the reserve for unfunded lending commitments, valuation of mortgage servicing rights, valuation of goodwill, intangible assets and other purchase accounting related adjustments, benefit plan obligations and expenses, and tax assets, liabilities and expenses.

   Stock-Based Compensation

          BB&T maintains various stock-based compensation plans. These plans provide for the granting of stock options (incentive and nonqualified), stock appreciation rights, restricted stock, performance units and performance shares to selected BB&T employees and directors. All of BB&T’s stock-based compensation plans, except for plans assumed in connection with the First Virginia Banks, Inc. merger, have been presented to, and approved by, BB&T’s shareholders. BB&T accounts for its stock option plans based on the intrinsic value method set forth in Accounting Principles Board Opinion No. 25 (“APB 25”), “Accounting for Stock Issued to Employees,” and related interpretations. As a result, no compensation cost has been recognized for any of the periods presented, except with respect to restricted stock plans, as disclosed in the accompanying table. The following table presents BB&T’s net income, basic earnings per share and diluted earnings per share as reported, and pro forma net income and pro forma earnings per share assuming compensation cost for BB&T’s stock option plans had been determined based on the fair value at the grant dates for awards under those plans granted after December 31, 1994, consistent with the method prescribed by Statement of Financial Accounting Standards (“SFAS”) No. 123, “Accounting for Stock-Based Compensation” (“SFAS No. 123”).

BB&T Corporation          Page 8          Second Quarter 2005 10-Q

	For the Three Months Ended						For the Six Months Ended
	June 30,						June 30,
	2005			2004			2005			2004
	(Dollars in thousands, except per share data)
Net income:
Net income as reported	$	386,805		$	400,106		$	782,189		$	728,606
Add: Stock-based compensation expense
included in reported net income, net of tax		29			115			56			242
Deduct: Total stock-based employee
compensation expense determined under
fair value based method for all awards,
net of tax		(6,225	)		(5,098	)		(10,640	)		(10,855	)
Pro forma net income	$	380,609		$	395,123		$	771,605		$	717,993
Basic EPS:
As reported	$	.71		$	.72		$	1.43		$	1.32
Pro forma		.70			.71			1.41			1.30
Diluted EPS:
As reported		.70			.72			1.42			1.32
Pro forma		.69			.71			1.40			1.30

          The fair value of each option grant was estimated as of the date of grant using the Black-Scholes option-pricing model, with the following weighted-average assumptions used for grants in 2005 and 2004, respectively:

	For the Three Months Ended						For the Six Months Ended
	June 30,						June 30,
	2005			2004			2005			2004
Weighted-average assumptions:
Risk-free interest rate		4.1	%		3.9	%		4.1	%		3.5	%
Dividend yield		3.5			3.0			3.5			3.0
Volatility factor		20.0			27.0			20.0			27.0
Expected life		6.5	yrs		6.0	yrs		6.5	yrs		6.0	yrs
Fair value of options per share	$	6.61		$	8.02		$	6.51		$	8.19

   Changes in Accounting Principles and Effects of New Accounting Pronouncements

          In December 2003, the Accounting Standards Executive Committee of the American Institute of Certified Public Accountants issued Statement of Position 03-3, “Accounting for Certain Loans or Debt Securities Acquired in a Transfer” (“SOP 03-3”). SOP 03-3 addresses accounting for differences between contractual cash flows and cash flows expected to be collected from an investor’s initial investment in loans or debt securities (loans) acquired in a transfer if those differences are attributable, at least in part, to credit quality. It includes loans purchased by BB&T or acquired in business combinations. SOP 03-3 does not apply to loans originated by BB&T. BB&T adopted the provisions of SOP 03-3 effective January 1, 2005. The initial implementation had no effect on BB&T’s consolidated financial position or consolidated results of operations, but affects BB&T’s accounting for impaired loans acquired in business combinations.

BB&T Corporation          Page 9          Second Quarter 2005 10-Q

          In December 2004, the Financial Accounting Standards Board ("FASB") issued SFAS No. 153, "Exchanges of Nonmonetary Assets--an amendment of APB Opinion No. 29" ("SFAS No. 153"). SFAS No. 153 requires that exchanges of nonmonetary assets be accounted for at fair value unless the exchange lacks commercial substance. A nonmonetary exchange has commercial substance when the future cash flows of an entity are expected to change significantly as a result of the exchange. SFAS No. 153 also eliminates a provision in APB Opinion No. 29 that exempted nonmonetary exchanges of similar productive assets from fair value accounting. SFAS No. 153 is effective for nonmonetary asset exchanges occurring in periods beginning after June 15, 2005. Management currently does not anticipate that the effects of SFAS No. 153 will materially affect BB&T's consolidated financial position or consolidated results of operations.

          In December 2004, the FASB issued FASB Staff Position (“FSP”) 109-2, “Accounting and Disclosure Guidance for the Foreign Earnings Repatriation Provision within the American Jobs Creation Act of 2004” (the “Jobs Act”). The Jobs Act introduced a special one-time dividends received deduction on the repatriation of certain foreign earnings to a U.S. taxpayer, provided certain criteria are met. Under the provisions of the Jobs Act, a taxpayer would receive a tax deduction of 85% of certain foreign earnings if repatriated during 2005 pursuant to a domestic reinvestment plan. This Staff Position issued disclosure requirements and provided clarification on the accounting for the repatriation provisions of the Jobs Act. BB&T has evaluated and concluded that the potential income tax effects of these provisions are not material to BB&T.

          In December 2004, the FASB issued SFAS No. 123 (revised 2004), "Share-Based Payment" ("SFAS No. 123(R)"), which is a revision of SFAS No. 123. SFAS No. 123(R) supersedes APB 25 and amends SFAS No. 95, "Statement of Cash Flows." Generally, the approach in SFAS No. 123(R) is similar to the approach described in SFAS No. 123. However, SFAS No. 123(R) requires all share-based payments to employees, including grants of employee stock options, to be expensed based on their fair values.

          On April 14, 2005, the Securities and Exchange Commission (“SEC”) adopted a rule that delayed the effective date of SFAS No. 123(R), which required adoption no later than July 1, 2005. The SEC rule allows companies to implement SFAS No. 123(R) at the beginning of their next fiscal year that begins after June 15, 2005. Early adoption will be permitted in periods in which financial statements have not yet been issued. The new SEC rule does not change the accounting required by SFAS No. 123(R). BB&T plans to adopt SFAS No. 123(R) on January 1, 2006, using the modified-prospective method, which requires the recognition of compensation costs beginning with the effective date (a) based on the requirements of SFAS No. 123(R) for all share-based payments granted after the effective date and (b) based on the requirements of SFAS No. 123 for all awards granted to employees prior to the effective date of SFAS No. 123(R) that remain unvested on the effective date.

BB&T Corporation          Page 10          Second Quarter 2005 10-Q

          As permitted by SFAS No. 123, BB&T currently accounts for share-based payments to employees using the intrinsic value method prescribed by APB 25 and, as such, generally recognizes no compensation cost for employee stock options. Accordingly, the adoption of the fair value method in SFAS No. 123(R) will have an impact on BB&T’s result of operations, although it will have no impact on BB&T’s overall financial position. The impact of adoption of SFAS No. 123(R) cannot be predicted at this time because it will depend on levels of share-based payments granted in the future. Additionally, BB&T’s stock option grants contain a provision that accelerates vesting of options for holders that retire and have met retirement eligibility requirements. Currently, as part of the pro forma disclosures required by SFAS No. 123, BB&T records a pro forma expense for the unrecognized compensation cost in the period that the accelerated vesting occurs. However, upon adoption of SFAS No. 123(R), BB&T will recognize compensation expense based on retirement eligibility dates for all options which contain an accelerated vesting provision. SFAS No. 123(R) also requires the benefits of tax deductions in excess of recognized compensation cost to be reported as a financing cash flow, rather than as an operating cash flow as required under current literature. This requirement will reduce net operating cash flows and increase net financing cash flows in periods after adoption. While BB&T cannot estimate what those amounts will be in the future (because they depend on, among other things, when employees exercise stock options), the amount of operating cash flows recognized in prior periods for such tax deductions were $8.6 million for both the first six months of 2005 and 2004.

          In March 2005, the SEC staff issued Staff Accounting Bulletin No. 107 (“SAB 107”) to assist preparers with the implementation of SFAS No. 123(R).  SAB 107 recognizes that considerable judgment will be required by preparers to successfully implement SFAS No. 123(R), (specifically when valuing employee stock options); and that reasonable individuals, acting in good faith, may conclude differently on the fair value of employee stock options. Key topics covered by SAB 107 include: (a) valuation models – SAB 107 reinforces the flexibility allowed by SFAS 123(R) to choose an option-pricing model that meets the standard’s fair value measurement objective; (b) expected volatility – the SAB provides guidance on when it would be appropriate to rely exclusively on either historical or implied volatility in estimating expected volatility; and (c) expected term – the new guidance includes examples and some simplified approaches to determining the expected term under certain circumstances.  BB&T will apply the principles of SAB 107 in conjunction with its adoption of SFAS No. 123(R).

          In March 2005, the FASB issued FASB Interpretation No. 47, “Accounting for Conditional Asset Retirement Obligations” (“FIN 47”). This Interpretation clarifies that the term “conditional asset retirement obligation” as used in SFAS No. 143, “Accounting for Asset Retirement Obligations,” refers to a legal obligation to perform an asset retirement activity in which the timing and (or) method of settlement are conditional on a future event that may or may not be within the control of the entity. According to FIN 47, an entity is required to recognize a liability for the fair value of a conditional asset retirement obligation when incurred if the liability’s fair value can be reasonably estimated. The provisions of FIN 47 are effective for fiscal years ending after December 15, 2005. Management currently does not anticipate that the implementation of FIN 47 will materially affect BB&T’s consolidated financial position or consolidated results of operations.

BB&T Corporation          Page 11          Second Quarter 2005 10-Q

          In May 2005, the FASB issued SFAS No. 154, “Accounting Changes and Error Corrections,” (“SFAS No. 154”), which requires retrospective application for reporting a voluntary change in accounting principle, unless it is impracticable to do so. SFAS No. 154 provides guidance for determining whether retrospective application of a change in accounting principle is impracticable and also addresses the reporting of a correction of error by restating previously issued financial statements. SFAS No. 154 is effective for accounting changes and corrections of errors made in fiscal years beginning after December 15, 2005. The Company will adopt SFAS No. 154 as required, and management does not believe the adoption will have a material effect on the Company’s results of operations or financial position.

NOTE 2. Business Combinations

          The following table presents summary information with respect to significant mergers and acquisitions of financial institutions and other significant financial services companies completed by BB&T Corporation during 2004. There have been no significant mergers completed during the first half of 2005.

Summary of Significant Mergers and Acquisitions

										BB&T Common
								Total		Shares Issued
Date of				Total		Intangibles		Purchase		to Complete
Acquisition		Acquired Company	Headquarters	Assets		Recorded		Price		Transaction
	April 14, 2004	Republic Bancshares Inc.	St. Petersburg, Fla.	$	2.9 billion		$ 260.5 million		$ 433.4 million (1)		6.5 million
	February 1, 2004	McGriff, Seibels &
		Williams, Inc.	Birmingham, Al.		226.6 million		416.8 million		371.3 million (2)		8.2 million

(1) Includes cash consideration totaling $171.1 million
(2) Includes cash consideration at the time of acquisition and certain contingent consideration payments totaling $70.5 million.

   Insurance and Other Nonbank Acquisitions

          During the first six months of 2005, BB&T acquired three insurance businesses and three nonbank financial services companies, including the acquisition of a 70% ownership interest in Sterling Capital Management LLC, an investment management services company based in Charlotte, North Carolina. In conjunction with these transactions, BB&T issued approximately 638 thousand shares of common stock and paid approximately $130.6 million in cash. BB&T acquired eight insurance agencies and three nonbank financial service companies during 2004. In conjunction with these transactions, BB&T issued approximately 1.4 million shares of common stock and paid approximately $74.2 million in cash. BB&T also acquires client relationships, primarily from insurance companies. Such acquisitions have not been material to BB&T’s financial condition or results of operations.

BB&T Corporation          Page 12          Second Quarter 2005 10-Q

   Merger-Related and Restructuring Activities

          BB&T has incurred certain expenses in connection with business combinations. The following table presents the components of merger-related and restructuring charges included in noninterest expenses. This table includes changes to previously recorded merger-related accruals and period expenses for merger-related items that must be expensed as incurred. Items that are required to be expensed as incurred include certain expenses associated with systems conversions, data processing, training, travel and other costs.

Summary of Merger-Related and Restructuring Charges (Gains)
(Dollars in thousands)

	For the Three Months						For the Six Months
	Ended June 30,						Ended June 30,
	2005			2004			2005			2004
Severance and personnel-related items	$	(111	)	$	2,040		$	(1,398	)	$	7,828
Occupancy and equipment		(541	)		(7,643	)		(1,754	)		(5,890	)
Systems conversions and related items		--			1,015			3			802
Marketing and public relations		--			3,089			--			3,711
Other merger-related items		248			2,290			188			3,990
Total	$	(404	)	$	791		$	(2,961	)	$	10,441

          In conjunction with the consummation of an acquisition and completion of other requirements, BB&T typically accrues certain merger-related expenses related to estimated severance costs and other personnel-related costs, costs to terminate lease contracts, costs related to the disposal of duplicate facilities and equipment, costs to terminate data processing contracts and other costs associated with the acquisition. The following table presents a summary of BB&T’s merger accrual activity for 2005.

	Merger Accrual Activity
	(Dollars in thousands)
					Merger-related
	Balance				and									Balance
	January 1,		Accrued at		restructuring									June 30,
	2005		acquisition		charges (gains)			Utilized			Other, net (1)			2005
Severance and personnel-related items	$	14,658	$	50	$	(1,398	)	$	(1,866	)	$	--		$	11,444
Occupancy and equipment		15,554		170		(1,754	)		(1,347	)		771			13,394
Systems conversions and related items		--		--		3			(3	)		--			--
Other merger-related items		4,284		1,324		188			(1,039	)		(9	)		4,748
Total	$	34,496	$	1,544	$	(2,961	)	$	(4,255	)	$	762		$	29,586

(1) Other, net is primarily composed of adjustments resulting from changes to original estimates of merger-related accruals.

BB&T Corporation          Page 13          Second Quarter 2005 10-Q

NOTE 3. Securities

          The amortized cost and approximate fair values of securities held to maturity and available for sale were as follows:

	June 30, 2005
							Estimated
	Amortized		Gross Unrealized				Fair
	Cost		Gains		Losses		Value
	(Dollars in thousands)
Securities available for sale:
U.S. Treasuries	$	120,144	$	33	$	1,134	$	119,043
U.S. government entities		11,978,162		5,184		190,245		11,793,101
Mortgage-backed securities		6,507,736		23,400		44,483		6,486,653
States and political subdivisions		700,336		24,444		1,184		723,596
Equity and other securities		991,796		13,656		4,380		1,001,072
Total securities available for sale	$	20,298,174	$	66,717	$	241,426	$	20,123,465

	December 31, 2004
							Estimated
	Amortized		Gross Unrealized				Fair
	Cost		Gains		Losses		Value
	(Dollars in thousands)
Securities held to maturity:
U.S. Treasuries	$	125	$	--	$	--	$	125
Total securities held to maturity		125		--		--		125
Securities available for sale:
U.S. Treasuries		122,183		1,009		737		122,455
U.S. government entities		12,817,387		16,756		194,078		12,640,065
Mortgage-backed securities		4,537,855		26,664		34,093		4,530,426
States and political subdivisions		754,093		31,241		955		784,379
Equity and other securities		746,168		17,761		3,058		760,871
Total securities available for sale		18,977,686		93,431		232,921		18,838,196
Total	$	18,977,811	$	93,431	$	232,921	$	18,838,321

          BB&T evaluates each available for sale security in a loss position for other than temporary impairment. In its evaluation BB&T considers such factors as the length of time and the extent to which the market value has been below cost, the financial condition of the issuer, and BB&T’s ability and intent to hold the security to an expected recovery in market value. BB&T has not recognized any other-than-temporary impairment related to securities.

          The following table reflects the gross unrealized losses and fair values of BB&T’s investments at June 30, 2005, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position.

BB&T Corporation          Page 14          Second Quarter 2005 10-Q

	Less than 12 months				12 months or more				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	Value		Losses		Value		Losses		Value		Losses
	(Dollars in thousands)
Securities:
U.S. Treasuries	$	80,141	$	902	$	15,822	$	232	$	95,963	$	1,134
U.S. government entities		3,439,529		27,147		7,301,616		163,098		10,741,145		190,245
Mortgage-backed securities		3,054,695		22,984		1,257,573		21,499		4,312,268		44,483
States and political subdivisions		17,400		183		81,016		1,001		98,416		1,184
Equity and other securities		318,027		2,715		130,926		1,665		448,953		4,380
Total temporarily impaired securities	$	6,909,792	$	53,931	$	8,786,953	$	187,495	$	15,696,745	$	241,426

NOTE 4. Goodwill and Other Intangible Assets

          The changes in the carrying amount of goodwill attributable to each of BB&T’s operating segments for the six months ended June 30, 2005, and the year ended December 31, 2004, are as follows:

	Goodwill Activity by Operating Segment
											Investment
	Banking			Mortgage		Trust			Insurance		Banking and		Specialized
	Network			Banking		Services			Services		Brokerage		Lending		Total
	(Dollars in thousands)
Balance, December 31, 2003	$	3,212,517		$	7,459	$	27,330		$	269,252	$	70,255	$	29,713	$	3,616,526
Acquired goodwill, net		213,980			--		4,380			278,477		--		7,930		504,767
Adjustments to goodwill		(19,616	)		--		(369	)		21,385		894		654		2,948
Balance, December 31, 2004		3,406,881			7,459		31,341			569,114		71,149		38,297		4,124,241
Acquired goodwill, net		--			--		45,276			35,645		1,966		126		83,013
Adjustments to goodwill		4,610			--		748			18,517		1,944		646		26,465
Balance, June 30, 2005	$	3,411,491		$	7,459	$	77,365		$	623,276	$	75,059	$	39,069	$	4,233,719

          The adjustments to goodwill recorded during the first six months of 2005 include $22.3 million of contingent consideration paid to acquired companies subsequent to the date of acquisition based on the terms of the purchase agreements and $5.4 million related to the accounting for property and equipment leases of acquired companies. The adjustments to goodwill recorded during 2004 primarily reflect reallocations of purchase price subsequent to the dates of acquisition.

          The following table presents the gross carrying amounts and accumulated amortization for BB&T’s identifiable intangible assets subject to amortization at the dates presented:

BB&T Corporation          Page 15          Second Quarter 2005 10-Q

	Identifiable Intangible Assets
	As of June 30, 2005							As of December 31, 2004
	Gross					Net		Gross					Net
	Carrying		Accumulated			Carrying		Carrying		Accumulated			Carrying
	Amount		Amortization			Amount		Amount		Amortization			Amount
	(Dollars in thousands)
Identifiable intangible assets:
Core deposit intangibles	$	364,937	$	(160,449	)	$	204,488	$	364,937	$	(134,214	)	$	230,723
Other (1)		441,639		(110,162	)		331,477		362,500		(79,684	)		282,816
Totals	$	806,576	$	(270,611	)	$	535,965	$	727,437	$	(213,898	)	$	513,539

(1) Other amortizing identifiable intangibles are primarily composed of customer relationship intangibles.

          The following table presents estimated amortization expense for the full year 2005 and each of the next four years:

Estimated Amortization Expense
of Identifiable Intangible Assets
(Dollars in thousands)

For the Year Ending December 31:
2005	$	116,684
2006		100,145
2007		87,162
2008		73,127
2009		58,546

BB&T Corporation          Page 16          Second Quarter 2005 10-Q

NOTE 5. Long-Term Debt

          Long-term debt is summarized as follows:

	June 30,		December 31,
	2005		2004
	(Dollars in thousands)
Parent Company
7.25% Subordinated Notes Due 2007	$	249,290	$	249,122
6.375% Subordinated Notes Due 2025 (1)		--		351,111
6.50% Subordinated Notes Due 2011 (2,4)		646,097		645,841
4.75% Subordinated Notes Due 2012 (2,4)		494,992		494,707
5.20% Subordinated Notes Due 2015 (2,4)		996,401		996,274
4.90% Subordinated Notes Due 2017 (2,4)		358,500		--
5.25% Subordinated Notes Due 2019 (2,4)		599,756		599,750
Branch Bank
Floating Rate Senior Notes Due 2007 (3.34% at June 30, 2005)		499,845		499,806
Floating Rate Secured Borrowings Due 2007 (6)		1,500,000		1,500,000
4.875% Subordinated Notes Due 2013 (2,4)		249,155		249,099
Federal Home Loan Bank Advances to the Subsidiary Banks
Varying maturities to 2023 with interest rates from 1.00% to 8.50% (5)		6,123,635		5,572,685
Capitalized Leases
Varying maturities to 2028 with interest rates from 8.90% to 15.78%		1,998		1,966
Junior Subordinated Debt to Unconsolidated Trusts (3)		101,805		193,558
Other Long-Term Debt		2,655		2,952
Hedging Gains on Long-Term Debt		131,554		62,753
Total Long-Term Debt	$	11,955,683	$	11,419,624

(1) These subordinated notes were exchanged by BB&T on June 30, 2005.
(2) Subordinated notes that qualify under the risk-based capital guidelines as Tier 2 supplementary capital, subject to certain limitations.
(3) Securities that qualify under the risk-based capital guidelines as Tier 1 capital, subject to certain limitations. At June 30, 2005, the interest rates ranged from 8.90% to 10.07%.
(4) These fixed rate notes were swapped to floating rates based on LIBOR. At June 30, 2005, the effective interest rates ranged from 3.56% to 4.04%.
(5) At June 30, 2005, the weighted average cost of these advances was 5.09% and the weighted average maturity was 10.5 years.
(6) These borrowings are secured primarily by automobile loans and have variable rates based on LIBOR.

BB&T Corporation          Page 17          Second Quarter 2005 10-Q

          On June 30, 2005, BB&T exchanged $350 million of subordinated notes bearing an interest rate of 6.375% for $400 million aggregate principal amount of subordinated global notes maturing in 2017 and bearing an interest rate of 4.90%. This exchange is being accounted for under Emerging Issues Task Force 96-19, “Debtor’s Accounting for a Modification or Exchange of Debt Instruments” (“EITF 96-19”). The transaction gave rise to substantially similar debt under EITF 96-19 and resulted in no immediate gain or loss. The financing costs relating to this exchange will be deferred and amortized over the life of the new $400 million subordinated global notes.

NOTE 6. Contractual Obligations, Commitments, Contingent Liabilities, and Off-Balance Sheet Arrangements

          BB&T’s significant commitments include certain investments in affordable housing and historic building rehabilitation projects throughout its market area. BB&T enters into such arrangements as a means of supporting local communities and recognizes tax credits relating to its investments. At June 30, 2005, BB&T’s investments in such projects totaled $248.3 million, which includes outstanding commitments of $162.9 million. At December 31, 2004, BB&T’s investments in such projects totaled $257.7 million, which includes outstanding commitments of $215.2 million. BB&T typically acts as a limited partner in these investments and does not exert control over the operating or financial policies of the partnerships. BB&T’s subsidiary banks typically provide financing during the construction and development of the properties; however, permanent financing is generally obtained from independent third parties upon completion of a project. BB&T’s risk exposure relating to such commitments is generally limited to the amount of investments made.

          Standby letters of credit and financial guarantees written are unconditional commitments issued by BB&T to guarantee the performance of a customer to a third party. These guarantees are primarily issued to support public and private borrowing arrangements, including commercial paper issuance, bond financing and similar transactions. The credit risk involved in the issuance of these guarantees is essentially the same as that involved in extending loans to clients and as such, the instruments are collateralized when necessary. As of June 30, 2005, BB&T had issued a total of $2.2 billion in standby letters of credit. The carrying amount of the liability for such guarantees was $11.0 million at June 30, 2005.

          In the ordinary course of business, BB&T indemnifies its officers and directors to the fullest extent permitted by law against liabilities arising from litigation. BB&T also issues standard representation warranties in underwriting agreements, merger and acquisition agreements, loan sales, brokerage activities and other similar arrangements. Counterparties in many of these indemnifications provide similar indemnifications to BB&T. Although these agreements often do not specify limitations, BB&T has not been required to act on the guarantees and does not believe that any payments pursuant to them would materially change the financial condition or results of operations of BB&T.

          Merger and acquisition agreements of businesses other than financial institutions occasionally include additional incentives to the acquired entities to offset the loss of future cash flows previously received through ownership positions. Typically, these incentives are based on the acquired entity’s contribution to BB&T’s earnings compared to agreed-upon amounts. When offered, these incentives are typically issued for terms of three to eight years. As certain provisions of these agreements do not specify dollar limitations, it is not possible to quantify the maximum exposure resulting from these agreements.

BB&T Corporation          Page 18          Second Quarter 2005 10-Q

NOTE 7. Benefit Plans

          BB&T provides various benefit plans to substantially all employees, including employees of acquired entities. Employees of acquired entities generally participate in existing BB&T plans after consummation of the business combinations. The plans of acquired institutions are typically merged into the BB&T plans after consummation of the mergers, and, under these circumstances, credit is usually given to these employees for years of service at the acquired institution for vesting and eligibility purposes. Please refer to BB&T’s Annual Report on Form 10-K for the year ended December 31, 2004, for descriptions and disclosures about the various benefit plans offered by BB&T.

The following table summarizes the components of net periodic benefit cost recognized for the three-month and six-month periods ended June 30, 2005 and 2004, respectively:

	Pension Plans												Other Postretirement
	Qualified						Nonqualified						Benefit Plans
	For the						For the						For the
	Three months ended						Three months ended						Three months ended
	June 30,						June 30,						June 30,
	2005			2004			2005			2004			2005			2004
	(Dollars in thousands)
Service cost	$	15,931		$	13,529		$	971		$	772		$	--		$	993
Interest cost		13,363			12,653			1,528			1,660			348			1,911
Estimated return on plan assets		(20,097	)		(17,224	)		--			--			--			--
Amortization of unrecognized
transition obligation		--			--			--			15			--			55
Amortization of prior service cost		(1,147	)		(1,148	)		(7	)		(17	)		(1,300	)		192
Amortization of net loss		2,633			3,940			570			337			182			100
Net periodic benefit cost (income)	$	10,683		$	11,750		$	3,062		$	2,767		$	(770	)	$	3,251

	Pension Plans											Other Postretirement
	Qualified						Nonqualified					Benefit Plans
	For the						For the					For the
	Six months ended						Six months ended					Six months ended
	June 30,						June 30,					June 30,
	2005			2004			2005			2004		2005			2004
	(Dollars in thousands)
Service cost	$	31,862		$	27,058		$	1,943		$	1,544	$	--		$	1,985
Interest cost		26,727			25,306			3,056			2,880		696			3,820
Estimated return on plan assets		(40,194	)		(33,948	)		--			--		--			--
Amortization of unrecognized
transition obligation		--			--			--			30		--			110
Amortization of prior service cost		(2,295	)		(2,296	)		(14	)		2,466		(2,600	)		384
Amortization of net loss		5,266			7,880			1,140			674		364			199
Net periodic benefit cost (income)	$	21,366		$	24,000		$	6,125		$	7,594	$	(1,540	)	$	6,498

BB&T Corporation          Page 19          Second Quarter 2005 10-Q

          Management elected to make a discretionary contribution of $30.0 million to the qualified pension plan in the first quarter of 2005 and may make additional contributions later in 2005 if management deems it appropriate.

NOTE 8. Computation of Earnings per Share

          BB&T’s basic and diluted earnings per share amounts for the three and six month periods ended June 30, 2005 and 2004, respectively, were calculated as follows:

	For the Three Months				For the Six Months
	Ended June 30,				Ended June 30,
	2005		2004		2005		2004
	(Dollars in thousands, except per share data)
Basic Earnings Per Share:
Weighted average number of common shares		547,089,165		554,041,770		548,179,529		550,309,127
Net income	$	386,805	$	400,106	$	782,189	$	728,606
Basic earnings per share	$	.71	$	.72	$	1.43	$	1.32
Diluted Earnings Per Share:
Weighted average number of common shares		547,089,165		554,041,770		548,179,529		550,309,127
Add:
Effect of dilutive stock options		4,155,947		3,443,910		4,263,710		3,707,236
Weighted average number of diluted common shares		551,245,112		557,485,680		552,443,239		554,016,363
Net income	$	386,805	$	400,106	$	782,189	$	728,606
Diluted earnings per share	$	.70	$	.72	$	1.42	$	1.32

          For the quarters ended June 30, 2005 and 2004, respectively, antidilutive options to purchase 117 thousand shares and 16.6 million shares of common stock were outstanding. For the first six months of 2005 and 2004, respectively, antidilutive options to purchase 116 thousand shares and 14.4 million shares of common stock were outstanding. Antidilutive options outstanding were not included in the computation of diluted earnings per share.

BB&T Corporation          Page 20          Second Quarter 2005 10-Q

NOTE 9. Comprehensive Income

          The balances in accumulated other comprehensive loss for the periods indicated are shown in the following tables:

Accumulated Other Comprehensive Loss
June 30, 2005
	Before-Tax			Tax			After-Tax
	Amount			Benefit			Amount
	(Dollars in thousands)
Unrealized losses on securities available for sale	$	(174,708	)	$	(65,269	)	$	(109,439	)
Unrealized losses on cash flow hedges		(22,825	)		(8,810	)		(14,015	)
Minimum pension liability		(8,354	)		(3,197	)		(5,157	)
Total	$	(205,887	)	$	(77,276	)	$	(128,611	)

Accumulated Other Comprehensive Loss
December 31, 2004
	Before-Tax			Tax			After-Tax
	Amount			Benefit			Amount
	(Dollars in thousands)
Unrealized losses on securities available for sale	$	(139,493	)	$	(52,019	)	$	(87,474	)
Unrealized losses on cash flow hedges		(33,726	)		(13,018	)		(20,708	)
Minimum pension liability		(4,644	)		(1,625	)		(3,019	)
Total	$	(177,863	)	$	(66,662	)	$	(111,201	)

           The following table summarizes total comprehensive income for the three and six-month periods ended June 30, 2005 and 2004, respectively:

	For the Three Months Ended					For the Six Months Ended
	June 30,					June 30,
	2005		2004			2005			2004
	(Dollars in thousands)
Comprehensive income:
Net income	$	386,805	$	400,106		$	782,189		$	728,606
Other comprehensive income:
Net unrealized holding gains (losses) on securities		161,269		(373,248	)		(21,965	)		(239,579	)
Net unrealized gains (losses) on cash flow hedges		731		(20,588	)		6,693			(21,711	)
Net change in minimum pension liability		--		1			(2,138	)		(3,018	)
Total comprehensive income	$	548,805	$	6,271		$	764,779		$	464,298

BB&T Corporation          Page 21          Second Quarter 2005 10-Q

NOTE 10. Operating Segments

          BB&T’s operations are divided into seven reportable business segments: the Banking Network, Mortgage Banking, Trust Services, Insurance Services, Specialized Lending, Investment Banking and Brokerage, and Treasury. These operating segments have been identified based on BB&T’s management reporting structure. The segments require unique technology and marketing strategies and offer different products and services. While BB&T is managed as an integrated organization, individual executive managers are held accountable for the operations of these business segments.

          BB&T emphasizes revenue growth by focusing on client service, sales effectiveness and relationship management. The segment results contained herein are presented based on internal management accounting policies that were designed to support these strategic objectives. Unlike financial accounting, there is no comprehensive authoritative body of guidance for management accounting equivalent to generally accepted accounting principles. The performance of the segments is not comparable with BB&T’s consolidated results or with similar information presented by any other financial institution. Additionally, because of the interrelationships of the various segments, the information presented is not indicative of how the segments would perform if they operated as independent entities.

          Please refer to BB&T’s Annual Report on Form 10-K for the year ended December 31, 2004, for a description of internal accounting policies and the basis of segmentation, including a description of the segments presented in the accompanying tables.

          The following tables disclose selected financial information with respect to BB&T’s reportable business segments for the periods indicated:

BB&T Corporation          Page 22          Second Quarter 2005 10-Q

BB&T Corporation
Reportable Segments
For the Three Months Ended June 30, 2005 and 2004

	Banking Network				Mortgage Banking						Trust Services						Insurance Services						Specialized Lending
	2005		2004		2005			2004			2005			2004			2005			2004			2005		2004
	(Dollars in thousands)
Net interest income (expense)	$	616,301	$	512,483	$	178,559		$	182,900		$	(725	)	$	(511	)	$	2,276		$	933		$	73,218	$	66,493
Net intersegment interest income (expense)		263,028		265,109		(112,632	)		(94,065	)		1,931			2,271			--			--			--		--
Total net interest income		879,329		777,592		65,927			88,835			1,206			1,760			2,276			933			73,218		66,493
Provision for loan and lease losses		59,032		63,475		2,303			2,292			--			--			--			--			24,260		22,150
Noninterest income		225,841		207,080		14,911			65,191			41,105			34,157			174,877			159,827			18,344		13,624
Intersegment noninterest income		105,581		100,047		--			--			--			--			--			--			--		--
Noninterest expense		331,133		329,476		12,934			11,945			35,573			24,782			138,082			118,262			35,202		30,788
Allocated corporate expenses		158,940		138,496		8,888			4,836			4,165			2,026			7,103			4,787			4,216		4,236
Income before income taxes		661,646		553,272		56,713			134,953			2,573			9,109			31,968			37,711			27,884		22,943
Income tax provision (benefit)		223,342		183,859		19,182			44,749			940			3,063			12,500			14,852			9,271		6,869
Segment net income (loss)	$	438,304	$	369,413	$	37,531		$	90,204		$	1,633		$	6,046		$	19,468		$	22,859		$	18,613	$	16,074
Identifiable segment assets (period end)	$	54,015,364	$	50,576,349	$	13,628,857		$	13,045,280		$	208,432		$	96,613		$	1,996,451		$	1,639,462		$	2,898,231	$	2,301,676
	Investment Banking
	and Brokerage				Treasury						All Other Segments (1)						Intersegment Eliminations						Total Segments
	2005		2004		2005			2004			2005			2004			2005			2004			2005		2004
Net interest income (expense)	$	2,337	$	1,760	$	(4,475	)	$	42,320		$	45,660		$	41,088		$	--		$	--		$	913,151	$	847,466
Net intersegment interest income (expense)		--		--		17,950			6,721			--			--			(170,277	)		(180,036	)		--		--
Total net interest income		2,337		1,760		13,475			49,041			45,660			41,088			(170,277	)		(180,036	)		913,151		847,466
Provision for loan and lease losses		--		--		--			--			11,745			14,608			--			--			97,340		102,525
Noninterest income		86,022		64,488		18,157			15,405			32,886			30,391			--			--			612,143		590,163
Intersegment noninterest income		--		--		--			--			--			--			(105,581	)		(100,047	)		--		--
Noninterest expense		75,243		56,938		1,584			1,092			18,888			16,588			--			--			648,639		589,871
Allocated corporate expenses		3,600		3,506		69			1			4,860			3,836			--			--			191,841		161,724
Income before income taxes		9,516		5,804		29,979			63,353			43,053			36,447			(275,858	)		(280,083	)		587,474		583,509
Income tax provision (benefit)		3,739		2,240		4,717			15,736			17,974			12,790			(93,199	)		(92,160	)		198,466		191,998
Segment net income (loss)	$	5,777	$	3,564	$	25,262		$	47,617		$	25,079		$	23,657		$	(182,659	)	$	(187,923	)	$	389,008	$	391,511
Identifiable segment assets (period end)	$	1,335,921	$	951,954	$	20,298,337		$	17,570,336		$	4,409,088		$	4,328,363		$	--		$	--		$	98,790,681	$	90,510,033

(1) Includes financial data from subsidiaries below the quantitative and qualitative thresholds requiring disclosure.

BB&T Corporation          Page 23          Second Quarter 2005 10-Q

BB&T Corporation
Reportable Segments
For the Six Months Ended June 30, 2005 and 2004

	Banking Network				Mortgage Banking						Trust Services						Insurance Services						Specialized Lending
	2005		2004		2005			2004			2005			2004			2005			2004			2005		2004
	(Dollars in thousands)
Net interest income (expense)	$	1,188,695	$	996,561	$	349,472		$	359,084		$	(1,547	)	$	(1,604	)	$	3,928		$	1,752		$	143,021	$	128,453
Net intersegment interest income (expense)		530,930		485,883		(218,502	)		(181,195	)		3,855			4,472			--			--			--		--
Total net interest income		1,719,625		1,482,444		130,970			177,889			2,308			2,868			3,928			1,752			143,021		128,453
Provision for loan and lease losses		117,747		124,890		4,483			4,436			--			--			--			--			47,212		41,648
Noninterest income		420,630		394,439		50,524			70,359			74,995			65,838			323,718			278,075			32,269		24,878
Intersegment noninterest income		189,127		185,079		--			--			--			--			--			--			--		--
Noninterest expense		638,310		636,565		24,530			23,492			61,323			50,067			266,599			225,128			67,842		62,156
Allocated corporate expenses		306,337		268,597		17,784			9,678			7,819			3,846			14,187			9,570			8,895		7,232
Income before income taxes		1,266,988		1,031,910		134,697			210,642			8,161			14,793			46,860			45,129			51,341		42,295
Income tax provision (benefit)		425,708		338,363		45,301			69,270			3,068			4,932			18,412			17,839			16,595		12,566
Segment net income (loss)	$	841,280	$	693,547	$	89,396		$	141,372		$	5,093		$	9,861		$	28,448		$	27,290		$	34,746	$	29,729
Identifiable segment assets (period end)	$	54,015,364	$	50,576,349	$	13,628,857		$	13,045,280		$	208,432		$	96,613		$	1,996,451		$	1,639,462		$	2,898,231	$	2,301,676
	Investment Banking
	and Brokerage				Treasury						All Other Segments (1)						Intersegment Eliminations						Total Segments
	2005		2004		2005			2004			2005			2004			2005			2004			2005		2004
Net interest income (expense)	$	4,511	$	3,335	$	2,009		$	77,307		$	94,697		$	80,211		$	--		$	--		$	1,784,786	$	1,645,099
Net intersegment interest income (expense)		--		--		32,020			12,432			--			--			(348,303	)		(321,592	)		--		--
Total net interest income		4,511		3,335		34,029			89,739			94,697			80,211			(348,303	)		(321,592	)		1,784,786		1,645,099
Provision for loan and lease losses		--		--		--			--			16,712			29,660			--			--			186,154		200,634
Noninterest income		157,251		142,529		30,228			30,020			62,678			69,390			--			--			1,152,293		1,075,528
Intersegment noninterest income		--		--		--			--			--			--			(189,127	)		(185,079	)		--		--
Noninterest expense		138,881		119,866		2,963			2,663			40,421			31,110			--			--			1,240,869		1,151,047
Allocated corporate expenses		7,198		7,007		95			2			9,818			7,769			--			--			372,133		313,701
Income before income taxes		15,683		18,991		61,199			117,094			90,424			81,062			(537,430	)		(506,671	)		1,137,923		1,055,245
Income tax provision (benefit)		6,129		7,367		9,827			28,000			37,737			24,988			(180,531	)		(163,274	)		382,246		340,051
Segment net income (loss)	$	9,554	$	11,624	$	51,372		$	89,094		$	52,687		$	56,074		$	(356,899	)	$	(343,397	)	$	755,677	$	715,194
Identifiable segment assets (period end)	$	1,335,921	$	951,954	$	20,298,337		$	17,570,336		$	4,409,088		$	4,328,363		$	--		$	--		$	98,790,681	$	90,510,033

(1) Includes financial data from subsidiaries below the quantitative and qualitative thresholds requiring disclosure.

BB&T Corporation          Page 24          Second Quarter 2005 10-Q

          The following table presents a reconciliation of segment results to consolidated results:

	For the Three Months Ended						For the Six Months Ended
	June 30,						June 30,
	2005			2004			2005			2004
	(Dollars in thousands)						(Dollars in thousands)
Net Interest Income
Net interest income from segments	$	913,151		$	847,466		$	1,784,786		$	1,645,099
Other net interest income (1)		85,618			92,359			176,509			185,101
Elimination of management accounting practices (2)		(118,803	)		(99,332	)		(230,974	)		(197,153	)
Other, net (3)		(3,001	)		(790	)		(4,173	)		13,479
Consolidated net interest income	$	876,965		$	839,703		$	1,726,148		$	1,646,526
Net income
Net income from segments	$	389,008		$	391,511		$	755,677		$	715,194
Other net income (1)		70,720			70,535			156,473			127,313
Elimination of management accounting practices (2)		(17,084	)		(1,510	)		(36,948	)		(29,293	)
Other, net (3)		(55,839	)		(60,430	)		(93,013	)		(84,608	)
Consolidated net income	$	386,805		$	400,106		$	782,189		$	728,606
							June 30,			June 30,
							2005			2004
							(Dollars in thousands)
Total Assets
Total assets from segments							$	98,790,681		$	90,510,033
Other, net (1,3)								7,044,643			6,838,252
Consolidated total assets							$	105,835,324		$	97,348,285

(1) Other net interest income, other net income and other, net, include amounts applicable to BB&T's support functions that are not allocated to the reported segments.

(2) BB&T's reconciliation of total segment results to consolidated results requires the elimination of internal management accounting practices. These adjustments include the elimination of the funds transfer pricing credits and charges, the elimination of the economic provision for loan and lease losses and the elimination of allocated corporate expenses.

(3) Amounts include intercompany eliminations to arrive at consolidated results.

Item 2. Management’s Discussion and Analysis of Financial Condidion and Results of Operations

Forward-Looking Statements

          This report on Form 10-Q contains forward-looking statements with respect to the financial condition, results of operations and business of BB&T. These forward-looking statements involve certain risks and uncertainties and are based on the beliefs and assumptions of the management of BB&T, and on the information available to management at the time that these disclosures were prepared. Factors that may cause actual results to differ materially from those contemplated by such forward-looking statements include, among others, the following possibilities:

BB&T Corporation          Page 25          Second Quarter 2005 10-Q

· competitive pressures among depository and other financial institutions may increase significantly;

· changes in the interest rate environment may reduce net interest margins and/or the volumes and values of loans made or held as well as the value of other financial assets held;

· general economic or business conditions, either nationally or regionally, may be less favorable than expected, resulting in, among other things, a deterioration in credit quality and/or a reduced demand for credit or other services;

· legislative or regulatory changes, including changes in accounting standards, may adversely affect the businesses in which BB&T is engaged;

· adverse changes may occur in the securities markets;

· competitors of BB&T may have greater financial resources and develop products that enable them to compete more successfully than BB&T;

· costs or difficulties related to the integration of the businesses of BB&T and its merger partners may be greater than expected;

· expected cost savings associated with completed mergers may not be fully realized or realized within the expected time frames; and

· deposit attrition, customer loss or revenue loss following completed mergers may be greater than expected.

Critical Accounting Policies

          The accounting and reporting policies of BB&T Corporation and its subsidiaries are in accordance with accounting principles generally accepted in the United States of America and conform to general practices within the banking industry. BB&T’s financial position and results of operations are affected by management’s application of accounting policies, including estimates, assumptions and judgments made to arrive at the carrying value of assets and liabilities and amounts reported for revenues and expenses. Different assumptions in the application of these policies could result in material changes in BB&T’s consolidated financial position and/or consolidated results of operations and related disclosures. The more critical accounting and reporting policies include BB&T’s accounting for the allowance for loan and lease losses and reserve for unfunded lending commitments, valuation of mortgage servicing rights, intangible assets and other purchase accounting related adjustments associated with mergers and acquisitions, costs and benefit obligations associated with BB&T’s pension and postretirement benefit plans, and income taxes. Understanding BB&T’s accounting policies is fundamental to understanding BB&T’s consolidated financial position and consolidated results of operations. Accordingly, BB&T’s significant accounting policies and changes in accounting principles are discussed in detail in Note 1 in the “Notes to Consolidated Financial Statements” in BB&T’s 2004 Annual Report on Form 10-K filed with the Securities and Exchange Commission.

          The following is a summary of BB&T’s critical accounting policies that are highly dependent on estimates, assumptions and judgments. These critical accounting policies are reviewed with the Audit Committee of BB&T’s Corporate Board of Directors on a periodic basis.

BB&T Corporation          Page 26          Second Quarter 2005 10-Q

   Allowance for Loan and Lease Losses and Reserve for Unfunded Lending Commitments

          It is the policy of BB&T to maintain an allowance for loan and lease losses and a reserve for unfunded lending commitments that equals management’s best estimate of probable credit losses that are inherent in the portfolio at the balance sheet date. Estimates for loan and lease losses are determined by analyzing historical loan and lease losses, current trends in delinquencies and charge-offs, plans for problem loan and lease administration, the results of regulatory examinations, and changes in the size, composition and risk assessment of the loan and lease portfolio. Also included in management’s estimates for loan and lease losses are considerations with respect to the impact of current economic events, the outcome of which is uncertain. These events may include, but are not limited to, fluctuations in overall interest rates, political conditions, legislation that may directly or indirectly affect the banking industry and economic conditions affecting specific geographical areas and industries in which BB&T conducts business. The methodology used to determine an estimate for the reserve for unfunded lending commitments is inherently similar to the methodology utilized in calculating the allowance for loans and leases adjusted for factors specific to binding commitments, including the probability of funding and exposure at the time of funding.

   Valuation of Mortgage Servicing Rights

          BB&T has a significant mortgage loan servicing portfolio and related mortgage servicing rights. Mortgage servicing rights represent the present value of the future net servicing fees from servicing mortgage loans acquired or originated by BB&T. The methodology used to determine the fair value of mortgage servicing rights is subjective and requires the development of a number of assumptions, including anticipated prepayments of loan principal. The value of mortgage servicing rights is significantly affected by mortgage interest rates available in the marketplace, which influence mortgage loan prepayment speeds. In general, during periods of declining interest rates, the value of mortgage servicing assets declines due to increasing prepayments attributable to increased mortgage refinance activity. Conversely, during periods of rising interest rates, the value of servicing assets generally increases due to reduced refinance activity. BB&T amortizes mortgage servicing rights over the estimated period that servicing income is expected to be received based on projections of the amount and timing of estimated future cash flows. The amount and timing of servicing asset amortization is updated based on actual results and updated projections.

   Intangible Assets

          BB&T’s growth in business, profitability and market share over the past several years has been enhanced significantly by mergers and acquisitions. BB&T’s mergers and acquisitions are accounted for using the purchase method of accounting. Under the purchase method, BB&T is required to record the assets acquired, including identified intangible assets and liabilities assumed at their fair value, which often involves estimates based on third party valuations, such as appraisals, or internal valuations based on discounted cash flow analyses or other valuation techniques, which are inherently subjective. The amortization of identified intangible assets is based upon the estimated economic benefits to be received, which is also subjective. These estimates also include the establishment of various accruals and allowances based on planned facility dispositions and employee severance considerations, among other acquisition-related items. In addition, purchase acquisitions typically result in goodwill, which is subject to ongoing periodic impairment tests based on the fair value of net assets acquired compared to the carrying value of goodwill. The major assumptions used in the impairment testing process include the estimated future cash flows of each business unit and discount rates. Discount rates are unique to each business unit and are based upon the cost of capital specific to the industry in which the business unit operates.

BB&T Corporation          Page 27          Second Quarter 2005 10-Q

   Pension and Postretirement Benefit Obligations

          BB&T offers various pension plans and postretirement benefit plans to employees. The calculation of the obligations and related expenses under these plans requires the use of actuarial valuation methods and assumptions. Actuarial valuations and assumptions used in the determination of future values of plan assets and liabilities are subject to management judgment and may differ significantly if different assumptions are used.

   Income Taxes

          The calculation of BB&T’s income tax provision is complex and requires the use of estimates and judgments. As part of the Company’s analysis and implementation of business strategies, consideration is given to the tax laws and regulations that apply to the specific facts and circumstances for any transaction under evaluation. This analysis includes the amount and timing of the realization of income tax liabilities or benefits. Management closely monitors tax developments in order to evaluate the effect they may have on the Company’s overall tax position and the estimates and judgments utilized in determining the income tax provision and records adjustments as necessary.

EXECUTIVE SUMMARY

          BB&T's total assets at June 30, 2005, were $105.8 billion, an increase of $5.3 billion, or 5.3%, from December 31, 2004. The asset categories that experienced the largest increases were loans and leases, including loans held for sale, and securities available for sale, which grew $3.6 billion, or 5.2%, and $1.3 billion, or 6.8%, respectively, during the first half of 2005.

          Total deposits at June 30, 2005, were $71.8 billion, an increase of $4.1 billion, or 6.1%, from December 31, 2004. Shorter-term borrowed funds increased $449.9 million, or 6.7%, and long-term debt increased $536.1 million, or 4.7%, during the first six months of 2005. Total shareholders’ equity increased $215.9 million, or 2.0%, during the same time frame.

          Consolidated net income for the second quarter of 2005 totaled $386.8 million, a decrease of 3.3% compared to $400.1 million earned during the second quarter of 2004. Net income for the second quarter of 2005 included a one-time, non-cash adjustment related to property and equipment leases, which totaled $26.6 million after-tax, or $.05 per diluted share. On a diluted per share basis, earnings for the three months ended June 30, 2005, were $.70, compared to $.72 for the same period in 2004, a decrease of 2.8%. BB&T’s results of operations for the second quarter of 2005 produced an annualized return on average assets of 1.50% and an annualized return on average shareholders’ equity of 14.04% compared to prior year ratios of 1.65% and 15.17%, respectively.

BB&T Corporation          Page 28          Second Quarter 2005 10-Q

          Consolidated net income for the first six months of 2005 totaled $782.2 million, an increase of 7.4% compared to $728.6 million earned during the same period in 2004. On a diluted per share basis, earnings for the first six months of 2005 and 2004 were $1.42 and $1.32, respectively, which represents an increase of 7.6%. BB&T’s results of operations for the first six months of 2005 produced an annualized return on average assets of 1.55% and an annualized return on average shareholders’ equity of 14.37% compared to prior year ratios of 1.55% and 14.07%, respectively.

          Results during the second quarter of 2005 reflect further improvements in several key drivers of BB&T’s profitability. Among these were stronger loan growth, particularly in comparison to the first quarter of 2005, continued improvement in asset quality and higher revenues from noninterest income generating businesses. Second quarter revenues from BB&T’s noninterest income generating businesses increased significantly compared to the first quarter of 2005 partially due to seasonal factors, which primarily affected income from insurance commissions and service charges on deposits.

          Please refer to BB&T’s Annual Report on Form 10-K for the year ended December 31, 2004, for additional information with respect to BB&T’s recent accomplishments and significant challenges. The factors causing the fluctuations in the major balance sheet and income statement categories for the second quarter and first six months of 2005 are further discussed in the following sections.

ANALYSIS OF FINANCIAL CONDITION

Securities

          Securities available for sale totaled $20.1 billion at June 30, 2005, an increase of $1.3 billion, or 6.8%, compared with December 31, 2004. Securities available for sale had net unrealized losses, net of deferred income taxes, of $109.4 million and $87.5 million at June 30, 2005 and December 31, 2004, respectively. Trading securities totaled $675.1 million, up $340.9 million compared to the balance at December 31, 2004. BB&T’s trading portfolio can fluctuate significantly from period to period based on market conditions, which affect the timing of purchases and sales of securities.

          Average total securities for the first six months of 2005 amounted to $20.1 billion, an increase of $2.3 billion, or 13.1%, compared to the average balance during the first six months of 2004. Average total securities for the second quarter of 2005 amounted to $20.6 billion, an increase of $2.2 billion, or 12.2%, compared to the average balance for the second quarter of 2004. The increase in securities was the result of a combination of factors including the securitization of approximately $1.0 billion in residential mortgage loans during the third quarter of 2004 and the investment of excess funds generated by deposit growth.

BB&T Corporation          Page 29          Second Quarter 2005 10-Q

         The annualized fully taxable equivalent ("FTE") yield on the average securities portfolio for the second quarter of 2005 was 4.13%, which represents an increase of nine basis points compared to the annualized yield earned during the second quarter of 2004. For the first six months of 2005, the annualized FTE yield was 4.10%, which represents a decrease of one basis point compared to the annualized yield earned during the same period of 2004. The fluctuations in the annualized FTE yield on the average securities portfolio were primarily the result of changes in the overall composition of the securities portfolio with a larger concentration of higher-yielding mortgage-backed securities.

          On June 30, 2005, BB&T held certain investments having continuous unrealized loss positions for more than 12 months totaling $187.5 million. The majority of these investments were in U.S. government sponsored entity securities and it is expected that the securities will not be settled at a price less than their amortized cost. Therefore, BB&T has not recognized any other-than-temporary impairment in connection with these investments.

Loans and Leases

          BB&T emphasizes commercial lending to small and medium-sized businesses, consumer lending and mortgage lending with an overall goal of maximizing the profitability of the loan portfolio while maintaining strong asset quality. For the first six months of 2005, average total loans were $69.5 billion, an increase of $4.4 billion, or 6.8%, compared to the same period in 2004. During the first six months of 2005, average commercial loans, including lease receivables, increased $2.7 billion, or 8.5%, compared to the same period in 2004 and comprised 50.4% of the loan portfolio compared to 49.6% for the first six months of 2004. Average consumer loans, which include sales finance, revolving credit and direct retail, totaled $21.8 billion during the first half of 2005, an increase of $1.7 billion, or 8.4%, compared to the same period in 2004. During the first half of 2005, consumer loans comprised 31.3% of average loans compared to 30.9% for the first six months of 2004. Average mortgage loans increased slightly and totaled $12.7 billion for both the first six months of 2005 and 2004. Mortgage loans comprised the remaining 18.3% of the loan and lease portfolio for the first six months of 2005 compared to 19.5% for the same period of 2004.

          For the second quarter of 2005, average total loans were $70.4 billion, an increase of $3.5 billion, or 5.3%, compared to the same period in 2004. Average commercial loans and leases for the second quarter of 2005 increased $2.4 billion, or 7.1%, compared to the same period in 2004 and comprised 50.4% of the loan portfolio compared to 49.5% for the second quarter of 2004. Average consumer loans totaled $21.9 billion during the second quarter of 2005, an increase of $1.4 billion, or 6.8%, compared to the same period in 2004 and comprised 31.2% of average loans compared to 30.7% for the second quarter of 2004. Average mortgage loans totaled $13.0 billion for the second quarter of 2005, which represents a decrease of $232.8 million, or 1.8%, from the 2004 average and comprised the remaining 18.4% of the loan and lease portfolio for the second quarter of 2005 compared to 19.8% for the same period of 2004.

BB&T Corporation          Page 30          Second Quarter 2005 10-Q

          The slight fluctuations in the mix of the loan portfolio during the second quarter and first six months of 2005 compared to the same periods of 2004 were primarily caused by the securitization of residential mortgage loans. In particular, during the third quarter of 2004, BB&T securitized $1.0 billion in residential mortgage loans and transferred the related mortgage-backed securities to the available-for-sale securities portfolio.

          During the second quarter of 2005, BB&T's average loan portfolio grew 10.6% on an annualized basis compared to the first quarter of 2005 because of a significant increase in loan demand across BB&T’s footprint. The acceleration in loan growth was spread across all major loan categories and was led by average commercial loans, which grew 10.2% on an annualized basis compared to the first quarter. In addition, average consumer loans and mortgage loans grew 6.7% and 18.5%, respectively, on an annualized basis.

          The annualized FTE yields on commercial, consumer and mortgage loans for the first six months of 2005 were 6.20%, 7.16%, and 5.44%, respectively, resulting in an annualized yield on the total loan portfolio of 6.36%. The FTE yields on commercial, consumer and mortgage loans for the first six months of 2004 were 5.26%, 6.71%, and 5.63%, respectively, resulting in an annualized yield on the total loan portfolio of 5.78%. This reflects an increase of 58 basis points in the annualized yield on the total loan portfolio during the first six months of 2005 in comparison to 2004. For the second quarter of 2005, the annualized yield on the total loan portfolio was 6.47%, reflecting an increase of 75 basis points compared to the second quarter of 2004. The primary reason for the increases in yields for both the six months and the second quarter was the higher interest rate environment that existed during the first half of 2005 compared to 2004. Starting in the second half of 2004, the Federal Reserve Board increased the intended Federal funds rate in response to a pick up in economic activity and concerns over inflation. As a result of the Federal Reserve Board’s actions, the prime rate, which is the basis for pricing many commercial and consumer loans, was 6.25% at June 30, 2005 compared to 4.00% at the end of the second quarter of 2004. Therefore, the overall yield of the loan portfolio increased as commercial and consumer loans were repricing at higher rates. The rise in short-term interest rates, however, was not matched by a similar rise in long-term interest rates. Therefore, mortgage rates, which are influenced by long-term interest rates in the marketplace, remained relatively unchanged compared to last year. As a result, older higher-yielding mortgage loans, which matured or refinanced, were replaced with lower-yielding mortgage loans, resulting in a 19 basis point decrease in the overall yield of the mortgage loan portfolio for the first half of 2005 compared to the same period in 2004.

Other Interest Earning Assets

          Federal funds sold, securities purchased under resale agreements and other earning assets totaled $364.0 million at June 30, 2005, an increase of $123.7 million, or 51.4%, compared to December 31, 2004. Interest-bearing deposits with banks decreased $568.4 million, or 56.7%, compared to year-end 2004. These categories of earning assets are subject to large daily fluctuations based on the availability of these types of funds. The average yield on other interest earning assets was 2.86% for the first six months of 2005 compared to 1.47% for the same period in 2004. For the second quarter of 2005, the average yield on other interest-earning assets was 3.16%, up from 1.50% in the second quarter last year. These higher yields were the result of the increase in the Federal funds target rate as previously discussed.

BB&T Corporation          Page 31          Second Quarter 2005 10-Q

Goodwill and Other Assets

          BB&T’s other noninterest-earning assets, excluding premises and equipment and noninterest-bearing cash and due from banks, increased $344.0 million from December 31, 2004, to June 30, 2005. The increase was due primarily to an increase in goodwill and other intangible assets of $131.9 million, which resulted from several insurance and nonbank acquisitions, net of amortization, as well as increases in the cash surrender value of bank-owned life insurance and the carrying value of derivatives in a gain position of $43.9 million and $86.8 million, respectively.

          Other noninterest-earning assets also include commercial mortgage servicing rights totaling $16.2 million and residential mortgage servicing rights totaling $325.4 million, net of an allowance for impairment, which totaled $117.0 million at June 30, 2005.

Deposits

          Client deposits generated through the BB&T branch network are the largest source of funds used to support asset growth. Deposits totaled $71.8 billion at June 30, 2005, an increase of $4.1 billion, or 6.1%, from December 31, 2004. Average deposits for the first six months of 2005 increased $4.4 billion, or 6.8%, to $68.1 billion compared to the first six months of 2004. The categories of deposits with the highest average rates of growth were noninterest-bearing deposits, which increased $1.3 billion, or 11.6%, and money rate savings accounts, including investor deposit accounts, which increased $2.1 billion, or 9.8%.

          For the second quarter of 2005, average deposits increased $2.9 billion, or 4.5%, compared to the second quarter of 2004. The categories of deposits with the highest average rates of growth were average noninterest-bearing deposits and money rate savings accounts, which both increased $1.1 billion for the second quarter of 2005, representing increases of 9.5% and 5.3%, respectively, compared to the second quarter of 2004.

          In addition to the positive growth in client deposits, there has been a shift in the overall deposit mix as BB&T has emphasized growth in noninterest-bearing accounts. Noninterest-bearing accounts comprised 18.5% of total average deposits for the second quarter of 2005, compared to 17.7% for the second quarter of 2004. This has primarily been a shift from certificates of deposits and other time deposits, which comprised 40.9% of total average deposits for the second quarter of 2005, compared to 41.7% for the same period of 2004. However, more recently there has been a migration from money rate savings accounts to certificates of deposits.

          The annualized average rate paid on total interest-bearing deposits during the first six months of 2005 was 1.89%, an increase of 59 basis points compared to 2004. For the second quarter of 2005, the annualized average rate paid on total interest-bearing deposits was 1.99%, an increase of 71 basis points compared to the second quarter of 2004. These increases in the average rate paid resulted primarily from the higher interest rate environment that existed during 2005 compared to 2004, and competition in the pricing of deposit products.

BB&T Corporation          Page 32          Second Quarter 2005 10-Q

Borrowings

          While client deposits remain the primary source for funding loan originations and other balance sheet growth, management uses shorter-term borrowings as a supplementary funding source for loan growth. Shorter-term borrowings utilized by the Corporation include Federal funds purchased, securities sold under repurchase agreements, master notes, U.S. Treasury tax and loan deposit notes, short-term bank notes, and short-term Federal Home Loan Bank advances. At June 30, 2005, shorter-term borrowings totaled $7.1 billion, an increase of $449.9 million, or 6.7%, compared to December 31, 2004. For the second quarter of 2005, average shorter-term borrowed funds were $8.2 billion, an increase of $1.5 billion, or 23.0%, from the comparable period of 2004. For the six months ended June 30, 2005, average shorter-term borrowed funds increased $1.0 billion, or 15.3%, compared to the same period in 2004. The increase in these funds compared to December 31, 2004, was primarily rate driven due to their lower funding cost when compared with alternative funding sources.

          The average annualized rate paid on short-term borrowed funds was 2.66% for the first six months of 2005, an increase of 159 basis points from the average rate of 1.07% paid in the comparable period of 2004. The average annualized rate paid on shorter-term borrowed funds was 2.86% for the second quarter of 2005, an increase of 178 basis points from the average rate of 1.08% paid in the comparable period of 2004. The higher rates paid on short-term borrowed funds mirror the increases in the Federal funds rate over the same time periods.

          BB&T also utilizes long-term debt for a variety of funding needs, including the repurchase of common stock, and, to a lesser extent, regulatory capital. Long-term debt consists primarily of Federal Home Loan Bank (“FHLB”) advances to BB&T’s banking subsidiaries and corporate subordinated notes. Long-term debt totaled $12.0 billion at June 30, 2005, up $536.1 million, or 4.7%, from the balance at December 31, 2004, primarily due to an increase in the balance of FHLB advances, which are cost-effective long-term funding sources that provide BB&T with flexibility in the management of interest rate risk and liquidity. For the second quarter of 2005, average long-term debt totaled $11.6 billion, an increase of $931.3 million, or 8.7%, compared to the second quarter of 2004. For the six months ended June 30, 2005, average long-term borrowed funds were $11.5 billion, up $850.7 million, or 8.0%, compared to the first six months of 2004. The increase in average long-term debt was primarily caused by the issuance of $500 million of senior floating-rate debt issued by Branch Banking and Trust Company in the third quarter of 2004 and $600 million of subordinated global notes issued by BB&T Corporation in the fourth quarter of 2004.

          During the second quarter of 2005, BB&T redeemed $89.0 million of trust preferred securities. These trust preferred securities were assumed by BB&T through various acquisitions. The average interest rate paid on such securities was approximately 8.5%, which was significantly higher than BB&T’s current borrowing rates. BB&T recorded a $2.9 million loss on early extinguishment of debt in connection with the redemption, which is reflected in BB&T’s Consolidated Statements of Income as a category of noninterest expenses.

BB&T Corporation          Page 33          Second Quarter 2005 10-Q

          On June 30, 2005, BB&T exchanged $350 million of subordinated notes bearing an interest rate of 6.375% for $400 million aggregate principal amount of subordinated global notes maturing in 2017 and bearing an interest rate of 4.90%. This exchange is being accounted for under Emerging Issues Task Force 96-19, “Debtor’s Accounting for a Modification or Exchange of Debt Instruments” (“EITF 96-19”). The transaction gave rise to substantially similar debt under EITF 96-19 and resulted in no immediate gain or loss. The financing costs relating to this exchange will be deferred and amortized over the life of the new $400 million subordinated global notes.

          The average annualized rate paid on long-term debt for the second quarter of 2005 was 4.07%, an increase of 71 basis points compared to the second quarter of 2004. The average annualized rate paid on long-term borrowed funds was 4.00% for the first six months of 2005, an increase of 63 basis points compared to the average rate of 3.37% paid during the first six months of 2004. The increase in the cost of long-term funds resulted from recent increases in short-term rates, which are used to set rates for BB&T’s variable rate borrowings.

          On April 7, 2005 Moody’s Investors Service announced that it had upgraded BB&T’s Issuer rating to Aa3 from A1. Moody’s similarly raised other key ratings of BB&T and its subsidiaries. Moody’s commented on BB&T’s good regional banking franchise, high quality customer service, successful cross sales, very strong core profitability and sound credit culture as the key factors that resulted in the upgrades. On July 26, 2005 Fitch Ratings announced that it had also upgraded all of the key ratings of BB&T, including BB&T’s Individual rating to A/B from B. Fitch cited BB&T’s regional banking franchise, solid operating performance, sound credit fundamentals, diverse revenue stream and ability to cross-sell products as factors contributing to the upgrades. These recent upgrades reflect the strength of BB&T’s franchise and should have a positive effect on future funding costs.

Asset Quality

          Nonperforming assets, composed of foreclosed real estate, repossessions, nonaccrual loans and restructured loans, totaled $308.9 million at June 30, 2005, compared to $358.1 million at December 31, 2004. As a percentage of loans and leases plus foreclosed property, nonperforming assets were .43% at June 30, 2005, down from ..52% at December 31, 2004. Loans 90 days or more past due and still accruing interest totaled $79.3 million at June 30, 2005, compared to $100.2 million at year-end 2004.

          BB&T’s net charge-offs totaled $44.6 million for the second quarter and amounted to ..25% of average loans and leases, on an annualized basis, compared to $57.2 million, or .34% of average loans and leases, on an annualized basis, in the corresponding period in 2004. For the six months ended June 30, 2005 and 2004, net charge-offs totaled $91.4 million and $114.4 million, respectively, and represented .27% and .35%, respectively, of average loans and leases on an annualized basis.

BB&T Corporation          Page 34          Second Quarter 2005 10-Q

          The allowance for credit losses, which totaled $827.3 million and $828.3 million at June 30, 2005 and December 31, 2004, respectively, consists of the allowance for loan and lease losses, which is presented on the Consolidated Balance Sheets, and the reserve for unfunded lending commitments, which is included in other liabilities on the Consolidated Balance Sheets. The allowance for loan and lease losses totaled $809.3 million at June 30, 2005, compared to $804.9 million at December 31, 2004. The allowance amounted to 1.13% of loans and leases outstanding at June 30, 2005, compared to 1.18% at year-end 2004. The reserve for unfunded lending commitments totaled $18.0 million and $23.4 million at June 30, 2005 and December 31, 2004, respectively.

          The above levels of nonperforming assets as a percentage of total assets and quarterly net charge-offs as a percentage of average loans are the lowest experienced in four years. During the last seven quarters, BB&T’s credit quality has steadily improved as demonstrated by the successive quarterly declines in the level of nonperforming assets. In addition, net charge-offs for the second quarter of 2005 declined compared to both the second and fourth quarters of last year. These positive trends in asset quality are the primary factors that have resulted in a lower allowance for loan and lease losses as a percentage of total loans.

          Asset quality statistics for the last five calendar quarters are presented in the accompanying tables.

BB&T Corporation          Page 35          Second Quarter 2005 10-Q

ASSET QUALITY ANALYSIS
(Dollars in thousands)

	For the Three Months Ended
	6/30/05			3/31/05			12/31/04			9/30/04			6/30/04
Allowance For Credit Losses
Beginning balance	$	822,464		$	828,301		$	825,665		$	825,242		$	799,650
Allowance for acquired (sold) loans, net		--			--			1,795			(170	)		19,284
Provision for credit losses		49,424			41,045			65,153			57,165			63,533
Charge-offs
Commercial loans and leases		(17,572	)		(12,892	)		(30,668	)		(23,858	)		(23,740	)
Direct retail loans		(12,368	)		(11,484	)		(13,149	)		(12,170	)		(11,538	)
Sales finance loans		(16,792	)		(21,689	)		(23,479	)		(22,225	)		(21,664	)
Revolving credit loans		(12,552	)		(12,693	)		(13,149	)		(12,383	)		(12,531	)
Mortgage loans		(1,728	)		(1,476	)		(1,352	)		(1,207	)		(1,916	)
Total charge-offs		(61,012	)		(60,234	)		(81,797	)		(71,843	)		(71,389	)
Recoveries
Commercial loans and leases		6,626			4,043			7,788			6,210			4,216
Direct retail loans		2,714			2,399			2,566			2,090			2,675
Sales finance loans		4,333			4,275			4,559			4,317			4,165
Revolving credit loans		2,737			2,540			2,489			2,555			2,557
Mortgage loans		39			95			83			99			551
Total recoveries		16,449			13,352			17,485			15,271			14,164
Net charge-offs		(44,563	)		(46,882	)		(64,312	)		(56,572	)		(57,225	)
Ending balance	$	827,325		$	822,464		$	828,301		$	825,665		$	825,242
Nonperforming Assets
Nonaccrual loans and leases
Commercial loans and leases	$	115,367		$	127,220		$	143,420		$	173,303		$	199,718
Direct retail loans		44,672			47,194			46,187			48,792			50,968
Sales finance loans		17,237			17,306			14,670			15,484			13,152
Revolving credit loans		348			266			349			374			369
Mortgage loans		52,130			62,476			64,010			62,871			61,132
Total nonaccrual loans and leases		229,754			254,462			268,636			300,824			325,339
Foreclosed real estate		62,036			60,147			69,324			67,329			68,035
Other foreclosed property		16,550			18,199			19,579			20,821			18,995
Restructured loans		531			537			555			563			566
Total nonperforming assets	$	308,871		$	333,345		$	358,094		$	389,537		$	412,935
Loans 90 days or more past due
and still accruing
Commercial loans and leases	$	10,821		$	15,036		$	9,986		$	11,463		$	11,180
Direct retail loans		14,718			13,857			19,917			22,382			21,015
Sales finance loans		16,398			18,864			21,205			20,766			20,732
Revolving credit loans		3,886			4,067			4,837			4,797			4,116
Mortgage loans		33,494			31,432			44,225			40,397			38,698
Total loans 90 days or more past due
and still accruing	$	79,317		$	83,256		$	100,170		$	99,805		$	95,741

BB&T Corporation          Page 36          Second Quarter 2005 10-Q

ASSET QUALITY RATIOS

	For the Three Months Ended
	6/30/05			3/31/05			12/31/04			9/30/04			6/30/04
Loans 90 days or more past due and still
accruing as a percentage of total loans
and leases		.11	%		.12	%		.15	%		.15	%		.14	%
Nonaccrual and restructured loans and leases
as a percentage of total loans and leases		.32			.37			.39			.45			.49
Total nonperforming assets as a percentage of:
Total assets		.29			.33			.36			.40			.42
Loans and leases plus foreclosed property		.43			.48			.52			.58			.62
Net charge-offs as a percentage of
average loans and leases		.25			.28			.38			.34			.34
Allowance for loan and lease losses as a
percentage of loans and leases		1.13			1.16			1.18			1.22			1.22
Allowance for loan and lease losses as a
percentage of loans and leases
held for investment		1.14			1.17			1.19			1.23			1.23
Ratio of allowance for loan and lease losses to:
Net charge-offs		4.53	x		4.22	x		3.15	x		3.63	x		3.55	x
Nonaccrual and restructured loans and leases		3.51			3.14			2.99			2.71			2.50

Note: All items referring to loans and leases include loans held for sale and are net of unearned income. Applicable ratios are annualized.

ANALYSIS OF RESULTS OF OPERATIONS

          Consolidated net income for the second quarter of 2005 totaled $386.8 million, a decrease of $13.3 million, or 3.3%, compared to $400.1 million earned during the second quarter of 2004. Net income for the second quarter of 2005 included a one-time, non-cash adjustment related to property and equipment leases, which totaled $26.6 million after-tax, or $.05 per diluted share. On a diluted per share basis, earnings for the three months ended June 30, 2005 were $.70, compared to $.72 for the same period in 2004. BB&T’s results of operations for the second quarter of 2005 produced an annualized return on average assets of 1.50% and an annualized return on average shareholders’ equity of 14.04% compared to prior year ratios of 1.65% and 15.17%, respectively.

          Consolidated net income for the first six months of 2005 totaled $782.2 million, an increase of 7.4% compared to $728.6 million earned during the same period in 2004. On a diluted per share basis, earnings for the first six months of 2005 and 2004 were $1.42 and $1.32, respectively, which represents an increase of 7.6%. BB&T’s results of operations for the first six months of 2005 produced an annualized return on average assets of 1.55% and an annualized return on average shareholders’ equity of 14.37% compared to prior year ratios of 1.55% and 14.07%, respectively.

BB&T Corporation          Page 37          Second Quarter 2005 10-Q

          The following table sets forth selected financial ratios for the last five calendar quarters:

ANNUALIZED
PROFITABILITY MEASURES

	2005						2004
	Second			First			Fourth			Third			Second
	Quarter			Quarter			Quarter			Quarter			Quarter
Return on average assets		1.50	%		1.60	%		1.68	%		1.69	%		1.65	%
Return on average shareholders' equity		14.04			14.70			15.21			15.42			15.17
Net interest margin (taxable equivalent)		3.92			3.95			3.97			4.07			4.02

   Merger-Related and Restructuring Activities

          Mergers and acquisitions have played an important role in the development of BB&T’s franchise. BB&T has been an active acquirer of financial institutions, insurance agencies and other nonbank fee income producing businesses for many years. BB&T recorded certain merger-related items and restructuring costs during both 2005 and 2004. During the second quarter of 2005, BB&T recorded $249 thousand in net after-tax gains primarily associated with the sale of duplicate facilities and the finalization of severance and other personnel-related liabilities associated with recent acquisitions. During the second quarter of 2004, BB&T recorded $351 thousand in net after-tax charges primarily associated with the acquisition of Republic. For the six months ended June 30, 2005 and 2004, BB&T incurred $1.9 million in net after-tax gains and $6.5 million in net after-tax charges, respectively, primarily due to the same reasons that affected the respective second quarters of 2005 and 2004. The above expenses are reflected in BB&T’s Consolidated Statements of Income as a category of noninterest expenses.

          Merger-related charges and expenses include personnel-related expenses such as staff relocation costs, severance benefits, early retirement packages and contract settlements. They also include furniture, equipment and occupancy costs related to department and branch consolidations as well as costs related to converting the data processing systems of the acquired companies to BB&T’s automation platform. Merger-related charges also include professional fees, advertising and asset write-offs incurred in connection with the mergers.

          The following table presents the components of merger-related and restructuring charges included in noninterest expenses. This table includes changes to previously recorded merger-related accruals and period expenses for merger-related items that must be expensed as incurred. Items that are required to be expensed as incurred include certain expenses associated with systems conversions, data processing, training, travel and other costs.

BB&T Corporation          Page 38          Second Quarter 2005 10-Q

Summary of Merger-Related and Restructuring Charges (Gains)
(Dollars in thousands)

	For the Three Months						For the Six Months
	Ended June 30,						Ended June 30,
	2005			2004			2005			2004
Severance and personnel-related items	$	(111	)	$	2,040		$	(1,398	)	$	7,828
Occupancy and equipment		(541	)		(7,643	)		(1,754	)		(5,890	)
Systems conversions and related items		--			1,015			3			802
Marketing and public relations		--			3,089			--			3,711
Other merger-related items		248			2,290			188			3,990
Total	$	(404	)	$	791		$	(2,961	)	$	10,441

          Severance and personnel-related costs include severance, employee retention, payments related to change-in-control provisions of employment contracts, outplacement services and other benefits associated with employee termination, which typically occur in corporate support and data processing functions.

          Occupancy and equipment charges or credits represent merger-related costs or gains associated with lease terminations, obsolete equipment write-offs and the sale of duplicate facilities and equipment. Credits may result when obsolete properties or equipment are sold for more than originally estimated. Systems conversions and related charges include expenses necessary to convert and combine the acquired branches and operations of merged companies. Marketing and public relations costs represent direct media advertising related to the acquisitions. The other merger-related charges are comprised of asset and supply inventory write-offs, litigation accruals and other similar charges.

          In conjunction with the consummation of an acquisition and the completion of other requirements, BB&T typically accrues certain merger-related expenses related to estimated severance and other personnel costs, costs to terminate lease contracts, costs related to the disposal of duplicate facilities and equipment, costs to terminate data processing contracts and other costs associated with the acquisition. The following tables present a summary of activity with respect to BB&T’s merger and restructuring accruals, with the more significant merger (First Virginia) presented separately. These tables include costs reflected as expenses, as presented in the table above, and accruals recorded through purchase accounting adjustments.

BB&T Corporation          Page 39          Second Quarter 2005 10-Q

	First Virginia Banks, Inc
	(Dollars in thousands)
					Merger-related
	Balance				and								Balance
	January 1,		Accrued at		restructuring								June 30,
	2005		acquisition		charges (gains)			Utilized			Other, net (1)		2005
Severance and personnel-related items	$	7,559	$	--	$	(22	)	$	(998	)	$	--	$	6,539
Occupancy and equipment		6,146		--		(1,779	)		(623	)		872		4,616
Systems conversions and related items		--		--		3			(3	)		--		--
Other merger-related items		87		--		16			(167	)		64		--
Total	$	13,792	$	--	$	(1,782	)	$	(1,791	)	$	936	$	11,155

(1) Other, net is primarily composed of adjustments resulting from changes to original estimates of merger-related accruals.

          The remaining accruals at June 30, 2005 for First Virginia are related primarily to costs associated with severance payments to certain executive officers and costs to exit certain leases and to dispose of excess facilities and equipment. These liabilities will be utilized in the future because they relate to specific contracts or legal obligations that expire in later years, or they relate to the disposal of duplicate facilities and equipment, which may take longer to complete.

          Activity with respect to the merger and restructuring accruals for all other mergers is presented in the accompanying table:

	All Other Mergers
	(Dollars in thousands)
					Merger-related
	Balance				and									Balance
	January 1,		Accrued at		restructuring									June 30,
	2005		acquisition		charges (gains)			Utilized			Other, net (1)			2005
Severance and personnel-related items	$	7,099	$	50	$	(1,376	)	$	(868	)	$	--		$	4,905
Occupancy and equipment		9,408		170		25			(724	)		(101	)		8,778
Systems conversions and related items		--		--		--			--			--			--
Other merger-related items		4,197		1,324		172			(872	)		(73	)		4,748
Total	$	20,704	$	1,544	$	(1,179	)	$	(2,464	)	$	(174	)	$	18,431

(1) Other, net is primarily composed of adjustments resulting from changes to original estimates of merger-related accruals.

          The liabilities for severance and personnel-related costs relate to severance liabilities that will be paid out based on such factors as expected termination dates, the provisions of employment contracts and the terms of BB&T’s severance plans. The remaining occupancy and equipment accruals relate to costs to exit certain leases and to dispose of excess facilities and equipment. Such liabilities will be utilized upon termination of the various leases and sale of duplicate property. The other merger-related liabilities relate to litigation and other similar charges.

BB&T Corporation          Page 40          Second Quarter 2005 10-Q

          Because BB&T has often had multiple merger integrations in process, and due to limited resources, has had to schedule in advance significant events in the merger conversion and integration process, BB&T’s merger process and utilization of merger accruals has typically covered an extended period of time. In general, a major portion of accrued costs are utilized in conjunction with or immediately following the systems conversion, when most of the duplicate positions are eliminated and the terminated employees begin to receive severance. Other accruals are utilized over time based on the sale, closing or disposal of duplicate facilities or equipment or the expiration of lease contracts. Merger accruals are re-evaluated periodically and adjusted as necessary. The remaining accruals at June 30, 2005, are expected to be utilized during 2005, unless they relate to specific contracts that expire in later years.

Net Interest Income and Net Interest Margin

          Net interest income on a FTE basis was $897.5 million for the second quarter of 2005 compared to $860.2 million for the same period in 2004, an increase of $37.3 million, or 4.3%. For the three months ended June 30, 2005, average earning assets increased $5.9 billion, or 6.8%, compared to the same period of 2004, while average interest-bearing liabilities increased $4.3 billion, or 6.0%, and the net interest margin decreased from 4.02% in the second quarter of 2004 to 3.92% in the current quarter. The decrease in the net interest margin was caused by a combination of factors. The flattening of the yield curve in recent quarters and more intense price competition for commercial loans and deposits has resulted in an increase in funding costs that has outpaced the rise in yields on earning assets. In addition, the margin was negatively affected by the additional interest expense incurred in connection with BB&T’s stock repurchase program.

          For the six months ended June 30, 2005, net interest income on an FTE basis was $1.8 billion compared to $1.7 billion for the same period in 2004, an increase of $79.1 million, or 4.7%. Average earning assets for the first six months of 2005 increased $6.8 billion, or 8.1%, compared to the same period of 2004, while average interest-bearing liabilities increased $4.9 billion, or 7.1%. The net interest margin for the six months ended June 30, 2005 was 3.94%, down from 4.06% for the first six months of 2004. The decrease resulted largely from the same factors that affected the quarterly comparison described above.

          The following tables set forth the major components of net interest income and the related annualized yields and rates for the second quarter and first six months of 2005 compared to the same period in 2004, and the variances between the periods caused by changes in interest rates versus changes in volumes.

BB&T Corporation          Page 41          Second Quarter 2005 10-Q

FTE Net Interest Income and Rate / Volume Analysis
For the Three Months Ended June 30, 2005 and 2004

	Average Balances				Annualized Yield / Rate						Income / Expense				Increase			Change due to
	2005		2004		2005			2004			2005		2004		(Decrease)			Rate (6)			Volume (6)
	(Dollars in thousands)
Assets
Securities, at amortized cost (1):
U.S. Treasuries, U.S. government agencies and
entities and other (5)	$	19,906,132	$	17,534,149		4.04	%		3.91	%	$	200,829	$	171,583	$	29,246		$	5,819		$	23,427
States and political subdivisions		707,548		844,356		6.66			6.58			11,784		13,893		(2,109	)		155			(2,264	)
Total securities (5)		20,613,680		18,378,505		4.13			4.04			212,613		185,476		27,137			5,974			21,163
Other earning assets (2)		657,433		554,295		3.16			1.50			5,186		2,067		3,119			2,673			446
Loans and leases, net
of unearned income (1)(3)(4)(5)		70,385,690		66,863,486		6.47			5.72			1,135,417		952,389		183,028			130,971			52,057
Total earning assets		91,656,803		85,796,286		5.92			5.33			1,353,216		1,139,932		213,284			139,618			73,666
Non-earning assets		12,006,877		11,490,119
Total assets	$	103,663,680	$	97,286,405
Liabilities and Shareholders' Equity
Interest-bearing deposits:
Savings and interest-checking	$	5,010,228	$	5,034,541		0.36			0.20			4,554		2,515		2,039			2,051			(12	)
Money rate savings		22,945,871		21,801,020		1.25			0.64			71,785		34,604		37,181			35,269			1,912
Other time deposits		28,214,800		27,497,580		2.89			1.98			202,944		135,570		67,374			63,756			3,618
Total interest-bearing deposits		56,170,899		54,333,141		1.99			1.28			279,283		172,689		106,594			101,076			5,518
Federal funds purchased, securities sold
under repurchase agreements and
short-term borrowed funds		8,218,309		6,682,835		2.86			1.08			58,546		17,968		40,578			35,623			4,955
Long-term debt		11,599,714		10,668,414		4.07			3.36			117,890		89,094		28,796			20,535			8,261
Total interest-bearing liabilities		75,988,922		71,684,390		2.40			1.57			455,719		279,751		175,968			157,234			18,734
Noninterest-bearing deposits		12,771,153		11,663,685
Other liabilities		3,853,516		3,330,199
Shareholders' equity		11,050,089		10,608,131
Total liabilities and
shareholders' equity	$	103,663,680	$	97,286,405
Average interest rate spread						3.52			3.76
Net interest margin						3.92	%		4.02	%	$	897,497	$	860,181	$	37,316		$	(17,616	)	$	54,932
Taxable equivalent adjustment											$	20,532	$	20,478

(1) Yields related to securities, loans and leases exempt from income taxes are stated on a taxable equivalent basis assuming tax rates in effect for the periods presented.
(2) Includes Federal funds sold, securities purchased under resale agreements and other earning assets, and interest-bearing deposits with banks.
(3) Loan fees, which are not material for any of the periods shown, have been included for rate calculation purposes.
(4) Nonaccrual loans have been included in the average balances. Only the interest collected on such loans has been included as income.
(5) Includes assets which were held for sale or available for sale at amortized cost and trading securities at estimated fair value.
(6) Changes in interest income and expense attributable to both changes in interest rates and changes in volumes are allocated proportionately.

BB&T Corporation          Page 42          Second Quarter 2005 10-Q

FTE Net Interest Income and Rate / Volume Analysis
For the Six Months Ended June 30, 2005 and 2004

	Average Balances				Annualized Yield / Rate						Income / Expense				Increase			Change due to
	2005		2004		2005			2004			2005		2004		(Decrease)			Rate (6)			Volume (6)
	(Dollars in thousands)
Assets
Securities, at amortized cost (1):
U.S. Treasuries, U.S. government agencies and
entities and other (5)	$	19,393,420	$	16,922,084		4.01	%		3.98	%	$	388,537	$	337,029	$	51,508		$	2,543		$	48,965
States and political subdivisions		719,862		861,309		6.69			6.52			24,070		28,086		(4,016	)		673			(4,689	)
Total securities (5)		20,113,282		17,783,393		4.10			4.11			412,607		365,115		47,492			3,216			44,276
Other earning assets (2)		639,001		625,977		2.86			1.47			9,069		4,576		4,493			4,396			97
Loans and leases, net
of unearned income (1)(3)(4)(5)		69,486,907		65,041,815		6.36			5.78			2,195,194		1,871,419		323,775			190,820			132,955
Total earning assets		90,239,190		83,451,185		5.83			5.39			2,616,870		2,241,110		375,760			198,432			177,328
Non-earning assets		11,840,944		11,248,197
Total assets	$	102,080,134	$	94,699,382
Liabilities and Shareholders' Equity
Interest-bearing deposits:
Savings and interest-checking	$	4,910,182	$	4,804,957		0.34			0.21			8,208		4,944		3,264			3,152			112
Money rate savings		23,069,230		21,015,740		1.19			0.63			135,583		65,434		70,149			63,150			6,999
Other time deposits		27,650,534		26,745,650		2.75			2.02			376,791		269,088		107,703			98,332			9,371
Total interest-bearing deposits		55,629,946		52,566,347		1.89			1.30			520,582		339,466		181,116			164,634			16,482
Federal funds purchased, securities sold
under repurchase agreements and
short-term borrowed funds		7,655,154		6,640,017		2.66			1.07			101,012		35,363		65,649			59,499			6,150
Long-term debt		11,495,647		10,644,980		4.00			3.37			228,434		178,548		49,886			34,833			15,053
Total interest-bearing liabilities		74,780,747		69,851,344		2.29			1.59			850,028		553,377		296,651			258,966			37,685
Noninterest-bearing deposits		12,506,333		11,204,341
Other liabilities		3,815,277		3,230,368
Shareholders' equity		10,977,777		10,413,329
Total liabilities and
shareholders' equity	$	102,080,134	$	94,699,382
Average interest rate spread						3.54			3.80
Net interest margin						3.94	%		4.06	%	$	1,766,842	$	1,687,733	$	79,109		$	(60,534	)	$	139,643
Taxable equivalent adjustment											$	40,694	$	41,207

(1) Yields related to securities, loans and leases exempt from income taxes are stated on a taxable equivalent basis assuming tax rates in effect for the periods presented.
(2) Includes Federal funds sold, securities purchased under resale agreements and other earning assets, and interest-bearing deposits with banks.
(3) Loan fees, which are not material for any of the periods shown, have been included for rate calculation purposes.
(4) Nonaccrual loans have been included in the average balances. Only the interest collected on such loans has been included as income.
(5) Includes assets which were held for sale or available for sale at amortized cost and trading securities at estimated fair value.
(6) Changes in interest income and expense attributable to both changes in interest rates and changes in volumes are allocated proportionately.

BB&T Corporation          Page 43          Second Quarter 2005 10-Q

Provision for Credit Losses

          The provision for credit losses totaled $49.4 million for the second quarter of 2005 compared to $63.5 million for the second quarter of 2004, a decrease of $14.1 million. For the first six months of 2005, the provision for credit losses totaled $90.5 million, down $36.5 million from $127.0 million for the same period in 2004. The decrease in the provision for credit losses was primarily due to improving asset quality trends in BB&T’s loan portfolio as discussed in the “Asset Quality” section herein.

Noninterest Income

          Noninterest income as a percentage of total revenues has increased in recent years due to BB&T’s emphasis on growing and expanding its fee-based businesses. Fee-based service revenues lessen BB&T’s dependence on traditional spread-based interest income and are a relatively stable revenue source during periods of changing interest rates. Noninterest income for the three months ended June 30, 2005 totaled $584.9 million compared to $562.8 million for the same period in 2004, an increase of $22.1 million, or 3.9%. The growth in noninterest income was led by higher revenues from investment banking and brokerage fees and commissions, revenues from BB&T’s insurance operations, trust revenues, service charges on deposit accounts as well as other nondeposit fees and commissions. These increases were partially offset by a decline in income from mortgage banking operations. For the six months ended June 30, 2005, noninterest income totaled $1.1 billion, an increase of $63.3 million, or 6.1%, compared to the same period in 2004. The overall growth in noninterest income also reflects the impact of acquisitions.

          In addition, noninterest income increased $68.3 million compared to the first quarter of 2005, reflecting the significant seasonality in BB&T’s first quarter noninterest income. Such seasonality is particularly evident in the fluctuation of insurance commissions, which are the largest source of fee-based income. Traditionally, BB&T’s insurance operations have experienced stronger linked quarter performance during the second and fourth quarters of the year when a higher percentage of BB&T’s clients tend to renew their insurance policies.

          Service charges on deposits totaled $139.2 million for the second quarter of 2005, up $7.7 million, or 5.9%, compared to the second quarter of 2004. For the first six months of 2005, service charges on deposits totaled $259.9 million, an increase of $5.7 million, or 2.3%, compared to the same period in 2004. The increases in both the quarter and six month periods were primarily attributable to higher revenues from overdraft items, including changes in pricing and fee structure, and a decrease in fee waivers, which were partially offset by a decline in fees from commercial accounts due to higher earnings credits.

BB&T Corporation          Page 44          Second Quarter 2005 10-Q

          Trust income totaled $36.7 million for the current quarter, an increase of $5.2 million, or 16.5%, compared to the same period a year ago. For the first six months of 2005, trust income totaled $67.1 million, an increase of $5.6 million, or 9.1%, compared to the same period in 2004. Trust revenues are based on the types of services provided as well as the overall market value of assets managed, which is affected by stock market conditions. The increases in trust income were primarily due to higher asset management fees as a result of the acquisition of a majority stake in Sterling Capital Management LLC (“Sterling”), on April 1, 2005. As a result, total trust assets under management, including custodial accounts, increased from $26.6 billion at June 30, 2004 to $31.8 billion at June 30, 2005. The increase in assets under management, which resulted principally from the Sterling acquisition, was partially offset by a discontinuation of custodial responsibilities for approximately $4.5 billion of the assets of certain BB&T proprietary funds. The change in custodial responsibilities resulted in greater efficiencies for the shareholders of the BB&T Funds.

          Investment banking and brokerage fees and commissions totaled $81.0 million during the second quarter of 2005, an increase of $17.4 million, or 27.4%, compared to the second quarter of 2004. For the first six months of 2005, investment banking and brokerage fees and commissions totaled $149.9 million, an increase of $9.7 million, or 6.9%, compared to the same period in 2004. The increases in this category of revenue for the second quarter and first six months of 2005 resulted primarily from growth in revenues in investment banking services and improving trends in fixed income sales and trading at Scott & Stringfellow, BB&T’s wholly owned investment banking and brokerage subsidiary.

          Insurance commissions, which have become BB&T’s largest source of noninterest income, totaled $181.6 million for the second quarter of 2005, an increase of $16.9 million, or 10.3%, compared to the same three-month period of 2004. For the first six months of 2005, insurance commissions totaled $333.9 million, up $45.5 million, or 15.8%, compared to the same period last year. In addition, insurance commissions increased $29.3 million compared to the first quarter of 2005, reflecting the seasonality of BB&T’s insurance operations. The increase in insurance revenues was primarily caused by the expansion of BB&T’s insurance agency network through the acquisition of several insurance companies during the second half of 2004 and first six months of 2005 as well as internal growth.

          Income from mortgage banking activities includes gains and losses from the sales of mortgage loans, revenue from servicing mortgage loans, valuation adjustments for mortgage servicing rights, mortgage servicing rights-related derivative gains/losses and amortization related to mortgage servicing rights. Mortgage banking income totaled $12.4 million in the second quarter of 2005, down $44.3 million, or 78.2%, compared to $56.7 million earned in the second quarter of 2004. The significant decrease in net mortgage banking income was largely the result of fluctuations in the valuation allowance for mortgage servicing rights, which is primarily a function of interest rate volatility. BB&T enters into a variety of derivative financial instruments to mitigate the risk associated with the valuation of mortgage servicing rights. As a result, the mortgage servicing rights impairment recorded in the current quarter and the recapture recorded in the second quarter of 2004 were largely offset by mortgage servicing rights-related derivative gains and losses, respectively. In addition, mortgage banking income during the current quarter was negatively affected by decreased revenues from residential mortgage production activities, which declined $8.7 million compared to the second quarter last year because of a lower volume of loan sales. During the second quarter of 2005, BB&T sold $1.1 billion in residential mortgage loans compared to loan sales of $2.3 billion in the second quarter of 2004. The decrease in loan sales was due to a larger percentage of 2005 loan originations having adjustable rates, which BB&T typically retains in the loan portfolio, and the timing of loan sales. The following table provides a breakdown of the various components of mortgage banking income for the second quarters of 2005 and 2004:

BB&T Corporation          Page 45          Second Quarter 2005 10-Q

Mortgage Banking Income and Related Statistical Information
As of / For the Three Months Ended June 30,

Mortgage Banking Income	2005			2004			% Change
	(Dollars in thousands)
Residential mortgage production revenues	$	13,143		$	21,830			(39.8	) %
Residential mortgage servicing revenues		23,758			22,498			5.6
Commercial mortgage banking revenues		6,053			3,708			63.2
Amortization of mortgage servicing rights		(21,456	)		(21,786	)		(1.5	)
Mortgage servicing rights valuation (impairment) recapture		(61,161	)		91,867			NM
Mortgage servicing rights derivative gains (losses)		52,030			(61,461	)		NM
Net		(9,131	)		30,406			NM
Total mortgage banking income	$	12,367		$	56,656			(78.2	)
Mortgage Banking Statistical Information	2005			2004			% Change
	(Dollars in millions)
Residential mortgage originations	$	2,688		$	3,166			(15.1	) %
Residential mortgage loans serviced for others		26,580			24,663			7.8
Commercial mortgage originations		411			338			21.6
Commercial mortgage loans serviced for others		7,032			6,921			1.6

NM - not meaningful

          For the first six months of 2005, mortgage banking income totaled $42.6 million, down $18.5 million, or 30.3%, compared to $61.1 million earned during the same period of 2004. The decrease in net mortgage banking income was primarily caused by the same factors that affected the quarterly decline, which included a net recapture of the valuation allowance for mortgage servicing rights of $1.8 million in the first half of 2005, compared to a net recapture of $26.2 million in the first half of 2004. During the first half of 2005, BB&T sold $2.4 billion in residential mortgage loans compared to loan sales of $2.9 billion in the first half of 2004. The following table provides a breakdown of the various components of mortgage banking income for the six month periods ended June 30, 2005 and 2004, respectively:

BB&T Corporation          Page 46          Second Quarter 2005 10-Q

Mortgage Banking Income and Related Statistical Information
As of / For the Six Months Ended June 30,

Mortgage Banking Income	2005			2004			% Change
	(Dollars in thousands)
Residential mortgage production revenues	$	28,616		$	31,316			(8.6	) %
Residential mortgage servicing revenues		47,013			45,520			3.3
Commercial mortgage banking revenues		8,890			6,612			34.5
Amortization of mortgage servicing rights		(43,739	)		(48,552	)		(9.9	)
Mortgage servicing rights valuation (impairment) recapture		(10,082	)		48,277			NM
Mortgage servicing rights derivative gains (losses)		11,862			(22,098	)		NM
Net		1,780			26,179			NM
Total mortgage banking income	$	42,560		$	61,075			(30.3	)
Mortgage Banking Statistical Information	2005			2004			% Change
	(Dollars in millions)
Residential mortgage originations	$	4,948		$	5,465			(9.5	) %
Commercial mortgage originations		599			548			9.3

NM - not meaningful

          Other nondeposit fees and commissions, including bankcard fees and merchant discounts, totaled $91.6 million for the second quarter of 2005, an increase of $12.1 million, or 15.2%, compared to the second quarter of 2004. For the six months ended June 30, 2005, other nondeposit fees and commissions, including bankcard fees and merchant discounts, totaled $171.9 million, an increase of $20.8 million, or 13.8%, compared to the same period in 2004. The principal drivers of the second quarter increase were check card and debit card interchange fees, official check outsourcing fees and bankcard income, which increased $6.3 million, $2.2 million and $2.5 million, respectively, compared to the same period in 2004. The 13.8% increase in other nondeposit fees and commissions, including bankcard fees and merchant discounts, for the first six months of 2005 was also primarily driven by check card interchange fees, official check outsourcing fees and bankcard income, which increased $11.4 million, $4.0 million and $5.0 million, respectively, compared to the same period in 2004.

          Other income totaled $42.5 million for the second quarter of 2005, an increase of $7.1 million, or 20.1%, compared with the second quarter of 2004. The principal drivers of the increase were higher income from investments in limited partnerships, an increase in gains on trading securities, and gains from sales of retail loans, which were $3.1 million, $2.0 million, and $1.2 million higher, respectively, than the second quarter of 2004. These increases were partially offset by $2.3 million of losses related to the ineffectiveness of certain fair value hedges. For the six months ended June 30, 2005, other income totaled $76.1 million, a decrease of $6.1 million, or 7.4%, compared with the same period last year. The primary reasons for the decrease were a fair value adjustment related to miscellaneous investments made by a small business investment company resulting in a gain of $12.7 million, which was recorded in the first quarter of 2004, while no similar gain was recorded in 2005, and $2.2 million of losses related to the ineffectiveness of certain fair value hedges, which were recorded in 2005. These decreases were partially offset by higher income from investments in limited partnerships and gains from sales of retail loans, which were $2.9 million and $2.3 million higher, respectively, than the first six months of 2004.

BB&T Corporation          Page 47          Second Quarter 2005 10-Q

Noninterest Expense

          Noninterest expenses totaled $831.3 million for the second quarter of 2005 compared to $740.2 million for the same period a year ago, an increase of $91.0 million, or 12.3%. For the first six months of 2005, noninterest expenses totaled $1.6 billion, an increase of $87.4 million, or 5.9%, over the same period a year ago. The increase in noninterest expenses was partially due to a $44.0 million pre-tax one-time, non-cash adjustment that was recorded in the second quarter of 2005 to account for escalating lease payments and the amortization of leasehold improvements. Noninterest expenses for the second quarter and first six months of 2005 also include $404 thousand and $3.0 million, respectively, in net pre-tax merger-related gains. Noninterest expenses for the second quarter and first six months of 2004 include $791 thousand and $10.4 million, respectively, in net pre-tax merger-related and restructuring expenses principally associated with the acquisitions of First Virginia and Republic.

          Personnel expense, the largest component of noninterest expense, was $450.7 million for the current quarter compared to $423.0 million for the same period in 2004, an increase of $27.7 million, or 6.6%. This increase was largely attributable to higher incentive compensation expenses, which increased $12.1 million compared to the second quarter last year, primarily relating to the growth in BB&T’s insurance and investment banking revenues. In addition, personnel expenses increased $14.6 million as a result of the higher number of full-time equivalent employees in the current quarter compared to last year due to the acquisitions of several insurance and nonbank financial services companies since the end of the second quarter of 2004. For the six months ended June 30, 2005, personnel expense totaled $865.8 million, up $22.6 million, or 2.7%, compared to 2004. The increase resulted primarily from the same factors that produced the quarterly increase, including incentive compensation expenses and additional personnel costs, which increased $20.8 million and $31.2 million, respectively. These increases were partially offset by an $8.0 million reduction in retiree benefit expenses, which resulted from an amendment to the postretirement benefit plan in the fourth quarter of 2004, and a $7.5 million decrease in funding for health care expenses.

          Occupancy and equipment expense for the three months ended June 30, 2005, totaled $148.1 million compared to $103.4 million for the second quarter of 2004, representing an increase of $44.7 million, or 43.2%. For the first six months of 2005, occupancy and equipment expense totaled $253.8 million, up $50.2 million, or 24.7%, compared to 2004. These increases were primarily related to the one-time lease adjustment noted above.

          The amortization of intangible assets totaled $28.6 million for the current quarter, slightly less than the $28.7 million incurred in the second quarter of 2004. For the six months ended June 30, 2005, amortization of intangible assets totaled $56.7 million, an increase of $4.0 million compared to the same period last year. This increase was primarily due to the acquisitions of Republic and several insurance agencies and nonbank financial services companies during the second half of 2004 and the first half of 2005. See Note 2 to the Consolidated Financial Statements herein for a summary of completed mergers and acquisitions.

BB&T Corporation          Page 48          Second Quarter 2005 10-Q

          Other noninterest expenses, including professional services, totaled $201.3 million for the second quarter of 2005, an increase of $17.0 million, or 9.2%, compared to the same period of 2004. The principal drivers of the increase were data processing expenses, advertising and marketing expenses, and loan and lease expenses, which increased $3.6 million, $5.9 million, and $3.4 million, respectively, compared to the second quarter of 2004. In addition, professional services expenses increased $3.2 million compared to the same period last year. For the six months ended June 30, 2005, other noninterest expenses, including professional services, totaled $385.6 million, an increase of $21.0 million, or 5.8%, compared to the same period in 2004. The principal reasons for the increase were similar to the factors that affected the quarterly growth.

          The effective management of operating costs is a key contributor to BB&T’s financial success, especially as BB&T becomes a larger and more diverse company. In 2004, management announced plans to implement cost savings and revenue enhancement initiatives with a goal to produce $175 million in combined annual cost savings and revenue enhancements. Implementation of the initiatives began in the fourth quarter of 2004, and management expects that approximately $60 million of the goal will be realized in 2005 and anticipates that substantially all of the initiatives will be implemented by the fourth quarter of 2006. During the first six months of 2005, management estimates that approximately $38 million was realized pursuant to this effort, primarily derived from cost savings.

Provision for Income Taxes

          The provision for income taxes totaled $194.4 million for the second quarter of 2005, a decrease of $4.2 million compared to the second quarter of 2004, primarily due to lower pretax income in the current quarter compared to second quarter last year. BB&T’s effective income tax rates for the second quarters of 2005 and 2004 were 33.4% and 33.2%, respectively. For the six months ended June 30, 2005, the provision for income taxes totaled $393.0 million, an increase of $38.4 million, or 10.8%, compared to the same period of 2004. The increased provision for income taxes for the first half of 2005 compared to 2004 was primarily the result of higher pretax income. BB&T’s effective income tax rates were 33.4% for the six months ended June 30, 2005 compared to 32.7% for the six months ended June 30, 2004.

          BB&T has extended credit to, and invested in, the obligations of states and municipalities and their agencies. The income generated from these investments, together with certain other transactions that have favorable tax treatment, have reduced BB&T’s overall effective tax rate from the statutory rate in 2005 and 2004.

          BB&T continually monitors and evaluates the potential impact of current events and circumstances on the estimates and assumptions used in the analysis of its income tax positions and, accordingly, BB&T’s effective tax rate may fluctuate in the future. On a periodic basis, BB&T evaluates its income tax positions based on tax laws and regulations and financial reporting considerations, and records adjustments as appropriate. This evaluation takes into consideration the status of current Internal Revenue Service (“IRS”) examinations of BB&T’s tax returns, recent positions taken by the IRS on similar transactions, if any, and the overall tax environment in relation to tax-advantaged transactions.

BB&T Corporation          Page 49          Second Quarter 2005 10-Q

          In the normal course of business, BB&T is subject to examinations from various tax authorities. These examinations may alter the timing or amount of taxable income or deductions or the allocation of income among tax jurisdictions. During 2003, the IRS concluded its examination of BB&T’s federal income tax returns for the years ended December 31, 1996, 1997 and 1998. Following their examination, the IRS issued a Revenue Agent Report assessing taxes and interest in the amount of $59.3 million related to BB&T’s income tax treatment of certain leveraged lease transactions which were entered into during the years under examination. The assessment, which was paid by BB&T during 2003, did not significantly affect BB&T’s consolidated results of operations in 2003 as it related primarily to differences in the timing of recognizing income and deductions for income tax purposes for which deferred taxes had been previously provided. Management continues to believe that BB&T’s treatment of these leveraged leases was appropriate and in compliance with the tax law and regulations applicable for the years examined. BB&T filed a refund request for the taxes and interest related to this matter, which was denied by the IRS during the second quarter of 2004. Early in the fourth quarter of 2004, BB&T filed a lawsuit in the United States District Court for the Middle District of North Carolina to pursue a refund of $3.3 million in taxes plus interest assessed by the IRS related to a leveraged lease transaction entered into during 1997. While management expects that this litigation will not be resolved for two to three years, management believes that there will be no material impact on the results of operations or the financial condition of BB&T, regardless of the outcome of the litigation.

MARKET RISK MANAGEMENT

          The effective management of market risk is essential to achieving BB&T’s strategic financial objectives. As a financial institution, BB&T’s most significant market risk exposure is interest rate risk; however, market risk also includes product liquidity risk, price risk, and volatility risk. The primary objective of interest rate risk management is to minimize any adverse effects that changes in interest rates have on interest sensitive income. This is accomplished through active management of asset and liability portfolios with a focus on the strategic pricing of asset and liability accounts and management of appropriate maturity mixes of assets and liabilities. The goal of these activities is the development of appropriate maturity and repricing opportunities in BB&T’s portfolios of assets and liabilities that will produce consistent interest sensitive income during periods of changing interest rates. BB&T’s Asset / Liability Management Committee (“ALCO”) monitors loan, investment and liability portfolios to ensure comprehensive management of interest rate risk. These portfolios are analyzed for proper fixed-rate and variable-rate mixes under various interest rate scenarios.

          The asset/liability management process is designed to achieve relatively stable net interest margins and assure liquidity by coordinating the volumes, maturities or repricing opportunities of earning assets, deposits and borrowed funds. It is the responsibility of the ALCO to determine and achieve the most appropriate volume and mix of earning assets and interest-bearing liabilities, as well as to ensure an adequate level of liquidity and capital, within the context of corporate performance goals. The ALCO also sets policy guidelines and establishes long-term strategies with respect to interest rate risk exposure and liquidity. The ALCO meets regularly to review BB&T’s interest rate risk and liquidity positions in relation to present and prospective market and business conditions, and adopts funding and balance sheet management strategies that are intended to ensure that the potential impact on earnings and liquidity as a result of fluctuations in interest rates is within acceptable standards.

BB&T Corporation          Page 50          Second Quarter 2005 10-Q

          The majority of BB&T’s assets and liabilities are monetary in nature, and, therefore, differ greatly from most commercial and industrial companies that have significant investments in fixed assets or inventories. Fluctuations in interest rates and actions of the Board of Governors of the Federal Reserve System (“FRB”) to regulate the availability and cost of credit have a greater effect on a financial institution’s profitability than do the effects of higher costs for goods and services. Through its balance sheet management function, which is monitored by the ALCO, management believes that BB&T is positioned to respond to changing needs for liquidity, changes in interest rates and inflationary trends.

          Management uses Interest Sensitivity Simulation Analysis (“Simulation”) to measure the sensitivity of projected earnings to changes in interest rates. Simulation takes into account the current contractual agreements that BB&T has made with its customers on deposits, borrowings, loans, investments and any commitments to enter into those transactions. Management monitors BB&T’s interest sensitivity by means of a computer model that incorporates the current volumes, average rates earned and paid, and scheduled maturities and payments of asset and liability portfolios, together with multiple scenarios of projected prepayments, repricing opportunities and anticipated volume growth. Using this information, the model projects earnings based on projected portfolio balances under multiple interest rate scenarios. This level of detail is needed to simulate the effect that changes in interest rates and portfolio balances may have on the earnings of BB&T. This method is subject to the accuracy of the assumptions that underlie the process, but management believes that it provides a better illustration of the sensitivity of earnings to changes in interest rates than other analyses such as static or dynamic gap.

          The asset/liability management process requires a number of key assumptions. Management determines the most likely outlook for the economy and interest rates by analyzing external factors, including published economic projections and data, the effects of likely monetary and fiscal policies, as well as any enacted or prospective regulatory changes. BB&T’s current and prospective liquidity position, current balance sheet volumes and projected growth, accessibility of funds for short-term needs and capital maintenance are also considered. This data is combined with various interest rate scenarios to provide management with information necessary to analyze interest sensitivity and to aid in the development of strategies to reach performance goals.

          The following table shows the effect that the indicated changes in interest rates would have on interest sensitive income as projected for the next twelve months under the “most likely” interest rate scenario incorporated into the Interest Sensitivity Simulation computer model. Key assumptions in the preparation of the table include prepayment speeds of mortgage-related assets, cash flows and maturities of derivative financial instruments, changes in market conditions, loan volumes and pricing, deposit sensitivity, customer preferences and capital plans. The resulting change in interest sensitive income reflects the level of sensitivity that interest sensitive income has in relation to changing interest rates.

BB&T Corporation          Page 51          Second Quarter 2005 10-Q

Interest Sensitivity Simulation Analysis
Interest Rate Scenario									Annualized Hypothetical
									Percentage Change in
Linear			Prime Rate						Net Interest Income
Change in			June 30,						June 30,
Prime Rate			2005			2004			2005			2004
	3.00	%		9.25	%		7.25	%		1.87	%		0.75	%
	1.50			7.75			5.75			1.42			0.52
	No Change			6.25			4.25			--			--
	(1.25	)		NA			3.00			NA			(2.29	)
	(1.50	)		4.75			NA			(2.00	)		NA
	(3.00	)		3.25			NA			(2.55	)		NA

NA = BB&T's model did not calculate results for these scenarios.

          Management has established parameters for asset/liability management, which prescribe a maximum negative impact on interest sensitive income of 3% for the next 12 months for a linear increase of 150 basis points for six months followed by a flat interest rate scenario for the remaining six month period, and a maximum negative impact of 6% for a linear increase of 300 basis points for 12 months.

Derivative Financial Instruments

          BB&T utilizes a variety of financial instruments to manage various financial risks. These instruments, commonly referred to as derivatives, primarily consist of interest rate swaps, swaptions, caps, floors, collars, financial forward and futures contracts, when-issued securities and options written and purchased. A derivative is a financial instrument that derives its cash flows, and therefore its value, by reference to an underlying instrument, index or referenced interest rate. BB&T uses derivatives primarily to manage risk related to business loans, federal funds purchased, long-term debt, mortgage servicing rights, mortgage banking operations and certificates of deposit. BB&T also uses derivatives to facilitate transactions on behalf of its clients.

          Derivative contracts are written in amounts referred to as notional amounts. Notional amounts only provide the basis for calculating payments between counterparties and do not represent amounts to be exchanged between parties, and are not a measure of financial risk. On June 30, 2005, BB&T had derivative financial instruments outstanding with notional amounts totaling $26.0 billion. The estimated net fair value of open contracts was $157.4 million at June 30, 2005. This compares to $20.5 billion in notional derivatives with a fair value of $73.3 million at December 31, 2004. Substantially all of the increase in notional amount was related to swaptions that are used to manage risk related to residential mortgage servicing rights valuations.

BB&T Corporation          Page 52          Second Quarter 2005 10-Q

          Credit risk related to derivatives arises when amounts receivable from a counterparty exceed those payable. Because the notional amount of the instruments only serves as a basis for calculating amounts receivable or payable, the risk of loss with any counterparty is limited to a small fraction of the notional amount. BB&T deals only with derivatives dealers that are national market makers with strong credit ratings in its derivatives activities. BB&T further controls the risk of loss by subjecting counterparties to credit reviews and approvals similar to those used in making loans and other extensions of credit. In addition, counterparties are required to provide cash collateral to BB&T when their unsecured loss positions exceed certain negotiated limits. All of the derivative contracts to which BB&T is a party settle monthly, quarterly or semiannually. Further, BB&T has netting agreements with the dealers with which it does business. Because of these factors, BB&T’s credit risk exposure related to derivative contracts at June 30, 2005 was not material.

          The following tables set forth certain information concerning BB&T’s derivative financial instruments at June 30, 2005:

Derivative Classifications and Hedging Relationships
June 30, 2005
(Dollars in thousands)

	Notional		Fair Value
	Amount		Gain		Loss
Derivatives Designated as Cash Flow Hedges:
Hedging business loans	$	2,550,000	$	2,463	$	(10,312	)
Hedging certificates of deposit and short-term borrowed funds		3,750,000		10,731		(752	)
Hedging medium-term bank notes		500,000		850		--
Derivatives Designated as Fair Value Hedges:
Hedging business loans		3,667		--		(64	)
Hedging long-term debt		3,400,000		131,554		--
Derivatives not designated as hedges		15,772,425		68,952		(45,985	)
Total	$	25,976,092	$	214,550	$	(57,113	)

BB&T Corporation          Page 53          Second Quarter 2005 10-Q

Derivative Financial Instruments
June 30, 2005
(Dollars in thousands)

			Average			Average			Estimated
	Notional		Receive			Pay			Fair
	Amount		Rate			Rate			Value
Receive fixed swaps	$	6,859,739		4.43	%		3.21	%	$	138,703
Pay fixed swaps		2,673,405		3.27			3.48			(8,972	)
Forward starting pay fixed swaps		1,250,000		N/A			N/A			4,508
Caps, floors and collars		1,418,849		N/A			N/A			88
Foreign exchange contracts		324,821		N/A			N/A			(1,280	)
Futures contracts		13,300		N/A			N/A			25
Interest rate lock commitments		840,228		N/A			N/A			2,095
Forward commitments		1,098,250		N/A			N/A			(3,967	)
Swaptions		6,539,000		N/A			N/A			12,625
When-issued securities		1,950,000		N/A			N/A			7,102
Options on contracts purchased		2,588,500		N/A			N/A			7,509
Options on contracts sold		420,000		N/A			N/A			(999	)
Total	$	25,976,092							$	157,437

N/A - not applicable.

Contractual Obligations, Commitments, Contingent Liabilities, Off-Balance Sheet Arrangements and Related Party Transactions

           BB&T utilizes a variety of financial instruments to meet the financial needs of its clients and to reduce exposure to fluctuations in interest rates. These financial instruments include commitments to extend credit, options written, standby letters of credit and other financial guarantees, interest rate caps, floors and collars, interest rate swaps, swaptions, when-issued securities and forward and futures contracts. Please refer to BB&T’s Annual Report on Form 10-K for the year ended December 31, 2004, for discussion with respect to BB&T’s quantitative and qualitative disclosures about its fixed and determinable contractual obligations. Items disclosed in the Annual Report on Form 10-K have not materially changed since that report was filed. A discussion of BB&T’s derivative financial instruments is included in the “Derivative Financial Instruments” section herein.

CAPITAL ADEQUACY AND RESOURCES

           The maintenance of appropriate levels of capital is a management priority and is monitored on an ongoing basis. BB&T’s principal goals related to capital are to provide an adequate return to shareholders while retaining a sufficient base from which to support future growth and to comply with all regulatory standards.

BB&T Corporation          Page 54          Second Quarter 2005 10-Q

          Total shareholders’ equity was $11.1 billion at June 30, 2005, compared to $10.9 billion at December 31, 2004, an increase of 2.0%. BB&T’s book value per common share at June 30, 2005 was $20.28, compared to $19.76 at December 31, 2004. BB&T’s tangible shareholders’ equity was $6.3 billion at June 30, 2005, a slight increase from $6.2 billion at December 31, 2004. BB&T’s tangible book value per common share at June 30, 2005 was $11.56, compared to $11.33 at December 31, 2004.

          Bank holding companies and their subsidiaries are subject to regulatory requirements with respect to risk-based capital adequacy. Capital adequacy is an important indicator of financial stability and performance. Risk-based capital ratios measure capital as a percentage of a combination of risk-weighted balance sheet and off-balance sheet risk. The risk-weighted values of both balance sheet and off-balance sheet items are determined in accordance with risk factors specified by Federal bank regulatory pronouncements.

          Tier 1 capital is calculated as common shareholders’ equity excluding unrealized gains or losses on debt securities available for sale, unrealized gains on equity securities available for sale and unrealized gains or losses on cash flow hedges, net of deferred income taxes; plus certain mandatorily redeemable capital securities, less nonqualifying intangible assets, net of applicable deferred income taxes, and certain nonfinancial equity investments. Tier 1 capital is required to be at least 4% of risk-weighted assets, and total capital (the sum of Tier 1 capital, a qualifying portion of the allowance for credit losses and qualifying subordinated debt) must be at least 8% of risk-weighted assets, with one half of the minimum consisting of Tier 1 capital.

          In addition to the risk-based capital measures described above, regulators also have established minimum leverage capital requirements for banking organizations. This is the primary measure of capital adequacy used by management and is calculated by dividing period-end Tier 1 capital by average tangible assets for the most recent quarter. The minimum required Tier 1 leverage ratio ranges from 3% to 5% depending upon Federal bank regulatory agency evaluation of an organization’s overall safety and soundness. BB&T’s regulatory capital ratios for the last five calendar quarters are set forth in the following table:

CAPITAL RATIOS

	2005						2004
	Second			First			Fourth			Third			Second
	Quarter			Quarter			Quarter			Quarter			Quarter
Risk-based capital ratios:
Tier 1 capital		8.7	%		9.2	%		9.2	%		9.3	%		9.2	%
Total capital		14.2			14.3			14.5			14.0			12.1
Tier 1 leverage ratio		6.7			7.0			7.1			7.1			7.0

BB&T Corporation          Page 55          Second Quarter 2005 10-Q

          BB&T’s Tier 1 leverage and Tier 1 capital ratios declined to 6.7% and 8.7%, respectively, at June 30, 2005 compared to 7.0% and 9.2%, respectively, at March 31, 2005. The decline in these ratios was primarily the result of the redemption of $89.0 million of trust preferred securities and greater than anticipated asset growth. BB&T projects that the Tier 1 leverage ratio will grow to 7.0% by the end of the third quarter of 2005.

   Share Repurchase Activity

          BB&T has periodically repurchased shares of its own common stock. In accordance with North Carolina law, repurchased shares cannot be held as treasury stock, but revert to the status of authorized and unissued shares upon repurchase.

          On August 26, 2003, BB&T’s Board of Directors granted authority for the repurchase of up to 50 million shares of BB&T’s common stock as needed for general corporate purposes. The plan remains in effect until all the authorized shares are repurchased unless modified by the Board of Directors.

          The following table presents the common stock repurchases made by BB&T during the second quarter of 2005:

Share Repurchase Activity

	2005
							Maximum Remaining
							Number of Shares
	Total		Average		Total Shares Purchased		Available for Repurchase
	Shares		Price Paid		Pursuant to		Pursuant to
	Repurchased (1)		Per Share (2)		Publicly-Announced Plan		Publicly-Announced Plan
April 1-30		2,401,098	$	38.04		2,400,000		30,046,900
May 1-31		116,959		38.74		100,000		29,946,900
June 1-30		4,944		40.42		--		29,946,900
Total		2,523,001	$	38.08		2,500,000		29,946,900

(1) Repurchases include shares exchanged or surrendered in connection with the exercise of stock options under BB&T's stock option plans.
(2) Excludes commissions.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

          Please refer to “Market Risk Management” in the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” section herein.

BB&T Corporation          Page 56          Second Quarter 2005 10-Q

Item 4. Controls and Procedures

          Evaluation of Disclosure Controls and Procedures

          As of the end of the period covered by this report, the management of the Company, under the supervision and with the participation of the Company’s Chief Executive Officer and Chief Financial Officer, carried out an evaluation of the effectiveness of the Company’s disclosure controls and procedures as defined in Rule 13a-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Based on that evaluation, the Chief Executive Officer and the Chief Financial Officer concluded that the Company’s disclosure controls and procedures are effective so as to enable the Company to record, process, summarize and report in a timely manner the information that the Company is required to disclose in its Exchange Act reports.

Changes in Internal Control over Financial Reporting

          There was no change in the Company’s internal control over financial reporting that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

          The nature of the business of BB&T’s banking subsidiaries ordinarily results in a certain amount of litigation. The subsidiaries of BB&T are involved in various legal proceedings, all of which are considered incidental to the normal conduct of business. Management believes that the liabilities arising from these proceedings will not have a materially adverse effect on the consolidated financial position or consolidated results of operations of BB&T.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

          (c) Please refer to “Share Repurchase Activity” in the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” section herein.

Item 4. Submission of Matters to a Vote of Security Holders

          BB&T held its Annual Meeting of Shareholders on April 26, 2005, to consider and vote on the matters listed below. A total of 419,887,280 of the Company’s shares were present or represented by proxy at the meeting. This represented approximately 77% of the Company’s outstanding shares.

BB&T Corporation          Page 57          Second Quarter 2005 10-Q

(1) The individuals named below were re-elected to serve as directors of the Corporation for a three-year term expiring in 2008:

Name	Votes Received	Votes Withheld
Anna R. Cablik	405,501,178	14,386,102
John P. Howe III	405,286,953	14,600,327
Nido R. Qubein	396,100,781	23,786,499

The individuals named below were re-elected to a one-year term as a director expiring on December 31, 2005:

Name	Votes Received	Votes Withheld
Albert F. Zettlemoyer	331,318,760	88,568,520
Alfred E. Cleveland	337,607,736	82,279,544

(2) The proposal to ratify the reappointment of PricewaterhouseCoopers LLP as the Corporation's independent registered public accounting firm was approved, with 411,944,089 shares voting for, 4,749,841 shares voting against, and 3,193,350 shares abstaining.

Item 6. Exhibits

3(ii) Bylaws of BB&T, as Amended and Restated Effective April 28, 2004, with Amendments through August 24, 2004.

11 Statement re Computation of Earnings Per Share.

12 Statement re Computation of Ratios.

31.1 Certification of Chief Executive Officer pursuant to Rule 13a-14(a) or 15d-14(a) of the Exchange Act, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2 Certification of Chief Financial Officer pursuant to Rule 13a-14(a) or 15d-14(a) of the Exchange Act, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1 Chief Executive Officer Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2 Chief Financial Officer Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

BB&T Corporation          Page 58          Second Quarter 2005 10-Q

SIGNATURES

          Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	BB&T CORPORATION
	(Registrant)
Date:   August 5, 2005	By:        /s/ Christopher L. Henson
	Christopher L. Henson, Senior Executive Vice
	President and Chief Financial Officer
Date:   August 5, 2005	By:        /s/ Edward D. Vest
	Edward D. Vest, Executive Vice President
	and Corporate Controller
	(Principal Accounting Officer)

BB&T Corporation          Page 59          Second Quarter 2005 10-Q

EXHIBIT INDEX

Exhibit No.	Description	Location
3(ii)	Bylaws of BB&T, as Amended and Restated Effective April 28, 2004, with Amendments through August 24, 2004.	Incorporate herein by reference to Exhibit 4.2 of Form S-3 Registration Statement No. 333-126592.
11	Statement re Computation of Earnings Per Share.	Filed herewith as Note 8.
12	Statement re Computation of Ratios.	Filed herewith.
31.1	Certification of Chief Executive Officer pursuant to Rule 13a-14(a) or 15d-14(a) of the Exchange Act, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.	Filed herewith.
31.2	Certification of Chief Financial Officer pursuant to Rule 13a-14(a) or 15d-14(a) of the Exchange Act, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.	Filed herewith.
32.1	Chief Executive Officer Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.	Filed herewith.
32.2	Chief Financial Officer Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.	Filed herewith.

BB&T Corporation          Page 60          Second Quarter 2005 10-Q

EX-12

Exhibit 12

BB&T Corporation
Earnings To Fixed Charges
(Dollars in thousands)

	For the Six Months Ended
	June 30,						For the Years Ended December 31,
	2005			2004			2004			2003			2002			2001			2000
Earnings:
Income before income taxes	$	1,175,225		$	1,083,222		$	2,322,362		$	1,617,030		$	1,790,697		$	1,360,428		$	1,013,006
Plus:
Fixed charges		876,900			567,601			1,232,111			1,306,218			1,713,021			2,438,401			2,586,815
Less:
Capitalized interest		232			263			638			514			504			798			470
Earnings, including interest on
deposits		2,051,893			1,650,560			3,553,835			2,922,734			3,503,214			3,798,031			3,599,351
Less:
Interest on deposits		520,582			339,466			729,660			755,677			1,003,058			1,566,269			1,685,248
Earnings, excluding interest on
deposits	$	1,531,311		$	1,311,094		$	2,824,175		$	2,167,057		$	2,500,156		$	2,231,762		$	1,914,103
Fixed Charges:
Interest expense	$	850,028		$	553,377		$	1,198,472		$	1,272,787		$	1,686,584		$	2,414,936		$	2,563,912
Capitalized interest		232			263			638			514			504			798			470
Interest portion of rent expense		26,640			13,961			33,001			32,917			25,933			22,667			22,433
Total Fixed Charges	$	876,900		$	567,601		$	1,232,111		$	1,306,218		$	1,713,021		$	2,438,401		$	2,586,815
Less:
Interest on deposits		520,582			339,466			729,660			755,677			1,003,058			1,566,269			1,685,248
Total fixed charges excluding
interest on deposits	$	356,318		$	228,135		$	502,451		$	550,541		$	709,963		$	872,132		$	901,567
Earnings to fixed charges:
Including interest on deposits		2.34	x		2.91	x		2.88	x		2.24	x		2.05	x		1.56	x		1.39	x
Excluding interest on deposits		4.30	x		5.75	x		5.62	x		3.94	x		3.52	x		2.56	x		2.12	x

EX-31.1

   Exhibit 31.1

CERTIFICATIONS

I, John A. Allison, IV, certify that:

          1. I have reviewed this Quarterly Report on Form 10-Q of BB&T Corporation;

          2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

          3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

          4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and we have:

     a)      Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

     b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

     c)      Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

     d)      Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

          5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

     a)      All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

     b)      Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 5, 2005

              /s/ John A. Allison, IV              

John A. Allison, IV

Chairman and Chief Executive Officer

EX-31.2

   Exhibit 31.2

CERTIFICATIONS

I, Christopher L. Henson, certify that:

          1. I have reviewed this Quarterly Report on Form 10-Q of BB&T Corporation;

          2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

          3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

          4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and we have:

     a)      Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

     b)      Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

     c)      Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

     d)      Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

          5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

     a)      All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

     b)      Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 5, 2005

              /s/ Christopher L. Henson              

Christopher L. Henson

Senior Executive Vice President and

Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO SECTION 906
OF THE SARBANES-OXLEY ACT OF 2002

I, John A. Allison, IV, state and attest that:

          (1) I am the Chairman and Chief Executive Officer of BB&T Corporation (the “Issuer”).

          (2) Accompanying this certification is the Issuer’s Quarterly Report on Form 10-Q for the period ended June 30, 2005, (the “Periodic Report”) as filed by the Issuer with the Securities and Exchange Commission pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), which contains financial statements.

          (3) I hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that

· the Periodic Report containing the financial statements fully complies with the requirements of Section 13(a) or 15(d) of the Exchange Act, and

· the information contained in the Periodic Report fairly presents, in all material respects, the financial condition and results of operations of the Issuer for the periods presented.

           /s/ John A. Allison, IV         
             John A. Allison, IV
Chairman and Chief Executive Officer
                August 5, 2005

          A signed original of this written statement required by Section 906 has been provided to BB&T Corporation and will be retained by BB&T Corporation and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO SECTION 906
OF THE SARBANES-OXLEY ACT OF 2002

I, Christopher L. Henson, state and attest that:

          (1) I am the Chief Financial Officer of BB&T Corporation (the "Issuer").

          (2) Accompanying this certification is the Issuer’s Quarterly Report on Form 10-Q for the period ended June 30, 2005, (the “Periodic Report”) as filed by the Issuer with the Securities and Exchange Commission pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), which contains financial statements.

          (3) I hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that

· the Periodic Report containing the financial statements fully complies with the requirements of Section 13(a) or 15(d) of the Exchange Act, and

· the information contained in the Periodic Report fairly presents, in all material respects, the financial condition and results of operations of the Issuer for the periods presented.

           /s/ Christopher L. Henson         
             Christopher L. Henson
Senior Executive Vice President and
         Chief Financial Officer
                August 5, 2005

          A signed original of this written statement required by Section 906 has been provided to BB&T Corporation and will be retained by BB&T Corporation and furnished to the Securities and Exchange Commission or its staff upon request.