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Benefit Plans
 12 Months Ended
Dec. 31, 2018
Retirement Benefits [Abstract]  
Benefit Plans
Benefit Plans
Defined Benefit Retirement Plans
 
BB&T provides defined benefit retirement plans qualified under the IRC that cover most employees. Benefits are based on years of service, age at retirement and the employee's compensation during the five highest consecutive years of earnings within the last ten years of employment.
 
In addition, supplemental retirement benefits are provided to certain key officers under supplemental defined benefit executive retirement plans, which are not qualified under the IRC. Although technically unfunded plans, Rabbi Trusts and insurance policies on the lives of certain of the covered employees are available to finance future benefits.

Financial data relative to qualified and nonqualified defined benefit pension plans is summarized in the following tables for the years indicated. On the Consolidated Balance Sheets, the qualified pension plan prepaid asset is recorded as a component of other assets and the nonqualified pension plans accrued liability is recorded as a component of other liabilities. The data is calculated using an actuarial measurement date of December 31.
Year Ended December 31,
(Dollars in millions)
Location
 
2018
 
2017
 
2016
Net periodic pension cost:
 
 
 
 
 
 
 
Service cost
Personnel expense
 
$
238

 
$
200

 
$
186

Interest cost
Other expense
 
201

 
192

 
181

Estimated return on plan assets
Other expense
 
(448
)
 
(372
)
 
(326
)
Net amortization and other
Other expense
 
81

 
75

 
80

Net periodic benefit cost
 
 
72

 
95

 
121

Pre-tax amounts recognized in OCI:
 
 
 

 
 

 
 

Prior service credit (cost)
 
 
—

 
30

 
—

Net actuarial loss (gain)
 
 
289

 
137

 
138

Net amortization
 
 
(81
)
 
(75
)
 
(80
)
Net amount recognized in OCI
 
 
208

 
92

 
58

Total net periodic pension costs (income) recognized in total comprehensive income, pre-tax
 
 
$
280

 
$
187

 
$
179

Weighted average assumptions used to determine net periodic pension cost:
 
 
 
 
 
 
Discount rate
 
 
3.79
%
 
4.43
%
 
4.68
%
Expected long-term rate of return on plan assets
 
 
7.00
%
 
7.00
%
 
7.00
%
Assumed long-term rate of annual compensation increases
 
 
4.50
%
 
4.50
%
 
4.50
%


The weighted average expected long-term rate of return on plan assets represents the average rate of return expected to be earned on plan assets over the period the benefits included in the benefit obligation are to be paid. In developing the expected rate of return, BB&T considers long-term compound annualized returns of historical market data for each asset category, as well as historical actual returns on the plan assets. Using this reference information, the Company develops forward-looking return expectations for each asset category and a weighted average expected long-term rate of return for the plan based on target asset allocations contained in BB&T's Investment Policy Statement. For 2019, the expected rate of return on plan assets is 7.0%.

Activity in the projected benefit obligation is presented in the following table:
Year Ended December 31,
(Dollars in millions)
Qualified Plan
 
Nonqualified Plans
2018
 
2017
 
2018
 
2017
Projected benefit obligation, January 1
$
4,939

 
$
3,939

 
$
387

 
$
426

Service cost
222

 
188

 
16

 
12

Interest cost
186

 
173

 
15

 
19

Actuarial (gain) loss
(537
)
 
576

 
(19
)
 
77

Benefits paid
(113
)
 
(102
)
 
(13
)
 
(12
)
Plan amendments
—

 
165

 
—

 
(135
)
Projected benefit obligation, December 31
$
4,697

 
$
4,939

 
$
386

 
$
387

Accumulated benefit obligation, December 31
$
4,035

 
$
4,198

 
$
293

 
$
288

Weighted average assumptions used to determine projected benefit obligations:
 
 
 
 
 
 
Weighted average assumed discount rate
4.43
%
 
3.79
%
 
4.43
%
 
3.79
%
Assumed rate of annual compensation increases
4.50
%
 
4.50
%
 
4.50
%
 
4.50
%

 
Effective December 31, 2017, the qualified defined benefit plan was amended and a portion of the accrued benefits of participants in the nonqualified plan were shifted to the qualified plan. Affected associates continue to participate in the nonqualified plan for benefits earned in 2017 and later. In conjunction with this shift, a minimum benefit was established under the qualified plan.

Activity in plan assets is presented in the following table:
Year Ended December 31,
(Dollars in millions)
 
Qualified Plan
 
Nonqualified Plans
 
2018
 
2017
 
2018
 
2017
Fair value of plan assets, January 1
 
$
6,309

 
$
5,044

 
$
—

 
$
—

Actual return on plan assets
 
(397
)
 
888

 
—

 
—

Employer contributions
 
169

 
479

 
13

 
13

Benefits paid
 
(113
)
 
(102
)
 
(13
)
 
(13
)
Fair value of plan assets, December 31
 
$
5,968

 
$
6,309

 
$
—

 
$
—

Funded status, December 31
 
$
1,271

 
$
1,370

 
$
(386
)
 
$
(387
)


The following are the pre-tax amounts recognized in AOCI:
Year Ended December 31,
(Dollars in millions)
 
Qualified Plan
 
Nonqualified Plans
 
2018
 
2017
 
2018
 
2017
Prior service credit (cost)
 
$
(140
)
 
$
(165
)
 
$
115

 
$
134

Net actuarial loss
 
(1,349
)
 
(1,092
)
 
(156
)
 
(198
)
Net amount recognized
 
$
(1,489
)
 
$
(1,257
)
 
$
(41
)
 
$
(64
)

 
The following table presents the amount expected to be amortized from AOCI into net periodic pension cost during 2019:
(Dollars in millions)
 
Qualified Plan
 
Nonqualified Plans
Net actuarial loss
 
$
(79
)
 
$
(17
)
Prior service credit (cost)
 
(25
)
 
$
19

Net amount expected to be amortized
 
$
(104
)
 
$
2



BB&T makes contributions to the qualified pension plan in amounts between the minimum required for funding and the maximum amount deductible for federal income tax purposes. BB&T made discretionary contributions of $549 million during the first quarter of 2019. Management may make additional contributions in 2019. For the nonqualified plans, the employer contributions are based on benefit payments.
 
The following table reflects the estimated benefit payments for the periods presented:
(Dollars in millions)
 
Qualified Plan
 
Nonqualified Plans
2019
 
$
126

 
$
16

2020
 
138

 
16

2021
 
151

 
17

2022
 
165

 
18

2023
 
179

 
19

2024-2028
 
1,126

 
113


 
BB&T's primary total return objective is to achieve returns that, over the long term, will fund retirement liabilities and provide for the desired plan benefits in a manner that satisfies the fiduciary requirements of the Employee Retirement Income Security Act of 1974. The plan assets have a long-term time horizon that runs concurrent with the average life expectancy of the participants. As such, the Plan can assume a time horizon that extends well beyond a full market cycle, and can assume an above-average level of risk, as measured by the standard deviation of annual return. It is expected, however, that both professional investment management and sufficient portfolio diversification will smooth volatility and help to generate a reasonable consistency of return. The investments are broadly diversified among economic sector, industry, quality and size in order to reduce risk and to produce incremental return. Within approved guidelines and restrictions, investment managers have wide discretion over the timing and selection of individual investments.

BB&T periodically reviews its asset allocation and investment policy and makes changes to its target asset allocation. BB&T has established guidelines within each asset category to ensure the appropriate balance of risk and reward. The fair values of pension plan assets by asset category for the qualified plan are reflected in the table below. Amounts carried using net asset values and accrued income are excluded from the table.
December 31,
(Dollars in millions)
Target Allocation
 
2018
 
2017
Min
 
Max
 
Total
 
Level 1
 
Level 2
 
Total
 
Level 1
 
Level 2
Cash and cash-equivalents
 
 
 
 
$
21

 
$
21

 
$
—

 
$
67

 
$
67

 
$
—

U.S. equity securities (1)
30
%
 
50
%
 
2,323

 
1,204

 
1,119

 
2,503

 
1,333

 
1,170

International equity securities
11

 
18

 
797

 
161

 
636

 
1,130

 
195

 
935

Fixed income securities
35

 
53

 
2,528

 
11

 
2,517

 
2,452

 
10

 
2,442

Total
 
 
 
 
$
5,669

 
$
1,397

 
$
4,272

 
$
6,152

 
$
1,605

 
$
4,547

(1)
The plan may hold up to 10% of its assets in BB&T common stock.

International equity securities include a common/commingled fund that consists of assets from several accounts, pooled together, to reduce management and administration costs. Investments measured at fair value using the net asset value per share or equivalent as a practical expedient are not required to be classified in the fair value hierarchy. The plan held alternative investments valued using net asset values totaling $274 million and $105 million at December 31, 2018 and 2017, respectively.
 
Defined Contribution Plans
 
BB&T offers a 401(k) Savings Plan and other defined contribution plans that permit employees to contribute up to 50% of their cash compensation. For full-time employees who are 21 years of age or older with 1 year or more of service, BB&T makes matching contributions of up to 6% of the employee's compensation. BB&T's contribution expense for the 401(k) Savings Plan and nonqualified defined contribution plans totaled $141 million, $133 million and $129 million for the years ended December 31, 2018, 2017 and 2016, respectively. Certain employees of subsidiaries participate in the 401(k) Savings Plan with different matching formulas.
 
Other Benefits
 
There are various other employment contracts, deferred compensation arrangements and non-compete covenants with selected members of management and certain retirees. These plans and their obligations are not material to the financial statements.