Regions Financial Corporation · NYSE:RF
Regions Financial — Investor Presentation (March 2002)
28 slides from Regions Financial's investor presentation, Mar 6, 2002
Slide 1: Regions
Reoions I
Slide 2: Forward-Looking Statement
Forward-Looking Statement ‘The information contained in this presentation may include forward-looking statements that reflect Regions’ cunent views with respect to future events and financial performance. Regions” management believes that these forward-looking statements are reasonable, however, ‘yo
Slide 3: Key Highlights
Key Highlights @ A leading financial service provider in the South @ Well diversified revenue stream @ Customer focused sales culture @ Constant emphasis on improved productivity and cost control @ Established credit culture @ Increasing earnings momentum Regions
Slide 4: Repositioning Initiatives in 2001
Repositioning Initiatives in 2001 e Emphasis placed on sales and revenue growth e Integration of Morgan Keegan e Integration of Rebsamen e Reduced interest rate sensitivity = $1.1 billion decline in investment securities = $1.7 billion decline in residential mortgages e Implemented capital allocatio
Slide 5: Strong Deposit Market Share in Footprint
Strong Deposit Market Share in Footprint #1 market share in Alabama at 17.4% #1 market share in Arkansas at 14.0% #4 market share in Georgia at 6.2% “#4 market share in Louisiana at 7.3% aN ge a TEI Top 3 Nara Share HEI th toch Mare share Regions
Slide 6: Community Banking Franchise
Community Banking Franchise Deposits: e Strong growth in low-cost core deposits = 11% increase in retail transaction accounts last year = 43% of total deposits @ Strategy of less aggressive pricing of CD’s in 2001 @ Wholesale deposits comprise only 8.6% of total deposits Loans: @ Planned slower loan
Slide 7: Regions — More Than A Bank
Regions —More Than A Bank— Over 30% of Revenue Stream from Other Financial Services Brokerage and Investment Banking 21% Retail and Commercial Asset Management Banking 2% 68% ‘Mortgage Banking M% Insurance 2% ; Regions
Slide 8: Regions — More Than A Bank
Regions —More Than A Bank— Over 30% of Revenue Stream from Other Financial Services Brokerage and Investment Banking 21% Retail and Commercial Asset Management Banking 2% 68% ‘Mortgage Banking ‘™% Insurance 2% ¥ Morgan Keegan acquisition in March 2001 added $420 million to 2001 revenues v Strong 4 Q
Slide 9: Regions/Morgan Keegan Footprint
Regions/Morgan Keegan Footprint
Slide 10: Morgan Keegan Revenues
Morgan Keegan Revenues Nine Months with Regions Apr - Dec 2001 Apr - Dec 2000 Revenues $420,248,433 $388,854,473 Pre-Tax $ 57,783,121 $ 49,157,777 Regions
Slide 11: Morgan Keegan Business Units
Morgan Keegan Business Units Private Client Group 45% Fixed Income Capital Markets Investment Advisory 40% 73% Equity Capital ‘Markets 1% Regions
Slide 12: Private Client Group
Private Client Group $240 million revenue (trailing 12 months) 1,410 employees 738 financial advisors $342,000 average annual FA production $42 million average assets per FA 214,000 total active accounts Regions
Slide 13: Equity Capital Markets Group
Equity Capital Markets Group $51 million revenue (trailing 12 months) 208 employees 33 institutional FAs $1.2 million average annual FA production 32 traders 17 senior research analysts covering 200 companies in 12 industry groups e@ 532 active account relationships in 38 states and 14 foreign count
Slide 14: Fixed Income Capital Markets Group
Fixed Income Capital Markets Group $158 million revenue (trailing 12 months) 428 employees 141 institutional FAs $1.1 million average annual FA production 41 traders 23 Fixed Income research professionals 78 Fixed Income banking professionals Regions
Slide 15: Fixed Income Sales & Trading
Fixed Income Sales & Trading One of the largest bond dealers in the nation with over $100 billion in high-grade product annually across four major product lines Largest underwriter in the world of FHLB debt Largest underwriter of all U.S. Agency debt ranked by number of deals Nation’s third largest
Slide 16: Investment Advisory
Investment Advisory $5.66 Billion Aggregate Assets under Management e Morgan Asset Management = Fund Management - $759 million = WealthTrust - $3,354 million* = Hester Capital Management - $766 million* e@ Morgan Keegan Trust Company - $730 million * Approximately 50% Morgan Keegan ownership Regions
Slide 17: Regions/Morgan Keegan Combined Trust Function
Regions/Morgan Keegan Combined Trust Function e Morgan Keegan assumed management of Regions Trust Function in early 2002 = Results in additional expertise and resources to benefit customers @ Combined $14 billion in assets under management @ Combined $52 billion in customer assets Regions
Slide 18: Morgan Keegan's Role
Morgan Keegan’s Role Provide leadership in developing a sales culture within Regions Financial Corporation. Establish Morgan Keegan as Regions’ exclusive distribution channel for investment products / services. e@ Emphasis on gathering assets e@ Pursue investment banking opportunities with existing
Slide 19: Regions — More Than A Bank
Regions —More Than A Bank— Over 30% of Revenue Stream from Other Financial Services Brokerage and Investment Banking 21% Asset Man: t Retail and te Commercial Banking ‘Mortgage Banking 68% 7% Insurance 2% v Rebsamen acquisition in February 2001 added $32 million to 2001 revenues v Rebsamen ranks amo
Slide 20: More Diversified Revenue Stream
More Diversified Revenue Stream ‘Morgan Keegan 50%. Non-interest income as % of revermes 41% 30% 29% Regions
Slide 21: Strong Revenue Momentum
Sin millions Strong Revenue Momentum $800 $673.5 $631.6 $600 $509.2 $400 $200 $0 4Q00 3Q01 4Q01 i Net interest income H Brokerage and asset management w Deposit service charges ™ Mortgage banking fees Other Regions a =
Slide 22: Active Integration of Sales Culture
Active Integration of Sales Culture e Bridging the gaps = Bringing together services/products from all lines of business = Increased training and coaching = Increased accountability @ Developed new commercial sales process = Complements Chart-the-Course on retail side = Focus attention on relationsh
Slide 23: Ongoing Focus on Productivity and Expense Control
Ongoing Focus on Productivity and Expense Control e@ Rationalizing branch distribution system = Closed or consolidated over 70 branches in 2001 = Ongoing process e@ Excellent company wide track record in 2001 = Core operating expenses in 2001 ¥ Decreased $9.2 million in 1* Quarter ¥ Decreased $3.9 m
Slide 24: Strengthened Loan Loss Allowance
Strengthened Loan Loss Allowance @ Increased allowance $43 million in 2001 @ Comprehensive review of portfolio resulted in higher level of loan losses in 4 Quarter e@ NPA portfolio granular, diversified, well secured, 30% single family residential @ 41 bps. charge offs for 2001 better than industry
Slide 25: Increased Focus on Optimizing Profitability of Franchise
Increased Focus on Optimizing Profitability of Franchise e@ Deleveraging balance sheet = Desensitized interest rate risk e Implementing new performance measurement system based on risk-adjusted returns on capital = Management tool for allocating capital within the company = Consistent framework for
Slide 26: Drivers of Earnings Growth
Drivers of Earnings Growth Margin is up 26 bps. over 4" Quarter 2000 level 4% Quarter 2001 loan loss provision exceeded net charge- offs by $29 million Poised for growth in balance sheet from increased sales efforts and improving economy Opportunities for growth in investment products/services Regio
Slide 27: Key Highlights
Key Highlights A leading financial service provider in the South Client focused sales culture and product set Excellent cost control Strong credit culture Experienced management team Earnings momentum increasing Regions 28 gyo
Slide 28: Regions
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