Regions Financial Corporation · NYSE:RF
Regions Financial — BancAnalysts Association of Boston Fall Conference 2017
36 slides from Regions Financial's conference presentation, Nov 2, 2017
Slide 1: BancAnalysts Association of Boston Fall Conference
BancAnalysts Association of Boston Fall Conference November 3, 2017 Exhibit 99.1
Slide 2: Grow and Diversify Revenue
Grow and Diversify Revenue 3} to grow customers and households and deepen existing relationships Prudently grow non-interest income Balance growth across geographies and businesses Disciplined Expense Management Majority of $400mm in expense saves by 2018 Continuously focus on icy and effectiveness
Slide 3: 2017 YTD Results
2017 YTD Results(1) Results reflect continued execution of our strategic plan 3 Profitability Balance Sheet andCapital Optimization Focused on the Fundamentals • Net income(2) increased 7% YTD • Diluted EPS(2) increased 13% YTD • Net interest income and other financing income (FTE) increased 4% YTD
Slide 4: 3Q17 Results and Outlook: Pre-tax pre-provision income
3Q17 Results and Outlook: • Pre-tax pre-provision income(1) increased $29 million or 6% compared to 2Q17; adjusted pre-tax pre-provision income(1) increased $22 million or 4% • Pre-tax pre-provision income(1) increased $27 million or 5% compared to 3Q16; adjusted pre-tax pre-provision income(1) incr
Slide 5: Net interest income and net interest margin
Net interest income(1) growth and improving net interest margin Net Interest Income and Other Financing Income (FTE) Net Interest Margin (RF) Net Interest Margin (Peer Median) 3Q16 4Q16 1Q17 2Q17 3Q17 $856 $874 $881 $904 $921 3.06% 3.16% 3.25% 3.32% 3.36% 2.97% 3.04% 3.11% 3.22% 3.24% • Net interest
Slide 6: Non-interest income
Non-interest income Capital markets Mortgage income Other Wealth management income Card and ATM fees Service charges on deposit accounts Selected items 3Q16 4Q16 1Q17 2Q17 3Q17 42 31 32 38 35 46 43 41 40 32 78 59 56 60 53 107 103 109 108 108 105 103 104 104 103 166 173 168 $510 169 175 55 $599 10 $5
Slide 7: Non-interest expenses
Non-interest expenses Prudently managing expenses 3Q16 4Q16 1Q17 2Q17 3Q17 912 877 872 899 880 22 $934 22 $899 5 $877 10 $909 6 $886 65.3% 63.2% 62.7% 63.2% 61.7% (1) Non-GAAP; see appendix for reconciliation ($ in millions) Selected Items(1)Adjusted Non-Interest Expense(1) 7 • Non-interest expense
Slide 8: NPLs and coverage ratio; stable asset quality
NPLs and coverage ratio(1) Criticized (Direct Energy) Criticized (Non-Energy) 3Q16 4Q16 1Q17 2Q17 3Q17 1,024 971 867 755 655 2,718 $3,742 2,641 $3,612 2,671 $3,538 2,525 $3,280 2,307 $2,962 Net Charge-Offs (Direct Energy) Net Charge-Offs (Non-Energy) Net Charge-Offs ratio 3Q16 4Q16 1Q17 2Q17 3Q17 6
Slide 9: Average loans and leases
Average loans and leases Business Lending Consumer Lending 3Q16 4Q16 1Q17 2Q17 3Q17 $50.2 $49.1 49.0 49.0 48.3 $31.1 $81.3 $31.5 $80.6 31.2 $80.2 31.1 $80.1 31.3 $79.6 Prudently managing loans ($ in billions) 9 • Total new and renewed loan production remained solid up 9% compared to 3Q16 including b
Slide 10: Average deposits by segment and type
Average deposits by segment Consumer Bank Corporate Bank Wealth Management Other 3Q16 4Q16 1Q17 2Q17 3Q17 55.2 55.6 56.2 57.1 57.0 28.3 28.7 28.2 27.6 27.6 10.6 10.2 10.0 9.5 9.3 3.8 $97.9 4.0 $98.5 3.6 $98.0 3.3 $97.5 3.0 $96.9 Average deposits by type Optimizing deposit mix Low-cost deposits Time
Slide 11: Deposits by customer type
$57 $8 $28 $3 3Q16 4Q16 1Q17 2Q17 3Q17 18 18 19 19 19 17 $35 18 $36 17 $36 17 $36 18 $37 Interest Bearing Deposits by Customer Type(1) ($ in billions) Non-Interest Bearing Deposits by Customer Type(1) ($ in billions) Other Segment Deposit advantage Deposits by Customer Type(1) (Retail vs. Business)
Slide 12: Deposit composition and pricing
Deposit composition and pricing (as of September 30, 2017) • Regions' predominantly deposit funded balance sheet, which includes an attractive mix of low cost deposits, provides for a competitive funding advantage against the peer set ◦ 91% of liability funding is comprised of deposits, the second h
Slide 13: Portfolio compositions and floating rate exposure
Loans 64% Securities 21% Other 15% Deposits 92% Borrowings 6% Other 2% Floating 48% Fixed 52% IB Checking, Money Market & Savings 55% Non-Interest Bearing Checking 38% Time 7% Floating 68% Fixed 32% Wholesale Borrowings(1)DepositsLoans(1)(2) Assets Liabilities $123B $79B $107B $98B $7B Portfolio Com
Slide 14: Interest rate risk assumptions and sensitivity analysis
Assumption Sensitivity Analysis (2)(3) ($ in millions) Standard Interest Rate Risk Scenario Assumptions Interest rate risk assumptions (as of September 30, 2017) (1) Growth expectations exclude the impact of third-party indirect-vehicle portfolio (2) Impacts of stresses to standard shock scenario ar
Slide 15: Strong capital levels
Strong capital levels Note: Regions’ and peer CET1 ratios are as of 9/30/17. Peers includes BBT, CFG, CMA, FHN, FITB, HBAN, HBHC, KEY, MTB, PNC, SNV, STI, USB and ZION. Source: SNL Financial15 Basel III Common Equity Tier 1 Ratio Peer #1 Peer #2 RF Peer #3 Peer #4 Peer #5 Peer #6 Peer #7 Peer #8 Pee
Slide 16: Capital Returned to Shareholders
Capital Returned to Shareholders Dividends Share Repurchases 2014 2015 2016 9/30/17 YTD 247 304 318 267 256 $503 623 $927 839 $1,157 775 $1,042 Robust capital returns (1) Includes fees associated with open market share repurchases.16 • Received no objection to planned CCAR capital actions; Board aut
Slide 17: Appendix, Non-GAAP and Forward Looking Statements
Appendix, Non-GAAP and Forward Looking Statements 17
Slide 18: Our banking franchise
Regions aims to be the premier regional financial institution in America Line of Business Coverage Alabama – 205 Louisiana – 99 Arkansas – 77 Mississippi – 119 Florida – 320 Missouri – 55 Georgia – 120 North Carolina – 6 Illinois – 47 South Carolina – 25 Indiana – 50 Tennessee – 211 Iowa – 8 Texas –
Slide 19: Strength of our markets
Strength of our markets 19 Market Share Rank in Core States 80% of total deposits are in our core states Alabama - Mississippi - Florida Louisiana - Tennessee - Arkansas 80% Market Share in Top Markets Source: SNL Financial As of 6/30/2017 FDIC summary Regions Branches Regions Insurance Group
Slide 20: Pre-tax adjusted items and selected items
Quarter Ended ($ amounts in millions, except per share data) 9/30/2017 6/30/2017 9/30/2016 Pre-tax adjusted items: Branch consolidation, property and equipment charges $ (5) $ (7) $ (5) Salaries and benefits related to severance charges (1) (3) (3) Loss on early extinguishment of debt — — (14) Secur
Slide 21: 2017 expectations
2017 expectations 21 • Excluding the impact of the third-party indirect-vehicle portfolio, full year average loans are expected to be down slightly compared to the prior year • Full year average deposits are expected to be relatively stable with the prior year • Net interest income and other financi
Slide 22: Executing on our strategy
Executing on our strategy 22 Note: The reconciliation with respect to forward-looking non-GAAP measures is expected to be consistent with the actual non-GAAP reconciliations included in the attached appendix. (1) Non-GAAP; see appendix for reconciliation
Slide 23: Commercial retail lending overview
Commercial retail lending overview Total retail (1) Does not include $26 million of retail related operating leases. * Represents the number of clients with loan balances outstanding.23 As of 9/30/17 ($ in millions) Loan Balances Total Commitments Including Outstanding Balances % Utilization $ Criti
Slide 24: Energy lending overview
Energy lending overview Total energy As of 9/30/17 As of 6/30/17 ($ in millions) Loan / Lease Balances Total Commitments Including Outstanding Balances % Utilization $ Criticized % Criticized Loan / Lease Balances Total Commitments Including Outstanding Balances % Utilization $ Criticized % Criticiz
Slide 25: Energy lending - Oil Field Services and E&P detail
Energy lending - Oil Field Services and Exploration & Production detail Type As of9/30/17 # of Clients* Commentary Marine $324 7 Sector remains under stress and will likely remain under stress in 2018. Contract coverage totals 54% of outstandings for remainder of 2017. Integrated OFS 91 6 Stabilized
Slide 26: Loan balances by select states: Texas and Louisiana
Commercial - Non-Energy, $2,211 Investor Real Estate, $134 Consumer Real Estate Secured, $1,145 Consumer Non-Real Estate Secured, $292 Commercial - Energy (Direct), $378 Loan balances by select states As of September 30, 2017 Texas Louisiana Commercial - Non- Energy, $4,288 Investor Real Estate, $98
Slide 27: Loan balances by select states: Alabama and Mississippi
Loan balances by select states (continued) As of September 30, 2017 Alabama Mississippi Commercial - Non- Energy, $4,866 Investor Real Estate, $270 Consumer Real Estate Secured, $3,577 Consumer Non-Real Estate Secured, $807 Commercial - Non-Energy, $1,454 Investor Real Estate, $131 Consumer Real Est
Slide 28: Loan balances by select states: Florida
Loan balances by select states (continued) As of September 30, 2017 Commercial - Non- Energy, $5,583 Investor Real Estate, $1,360 Consumer Real Estate Secured, $7,946 Consumer Non-Real Estate Secured, $1,360 Florida Investor Real Estate ($ in millions) Office Retail Multi-Family Single Family Other
Slide 29: Non-GAAP reconciliation: Non-interest income, expense and efficiency ratio
Non-GAAP reconciliation: Non-interest income, non-interest expense and efficiency ratio NM - Not Meaningful The table below presents computations of the efficiency ratio (non-GAAP), which is a measure of productivity, generally calculated as non-interest expense divided by total revenue. Management
Slide 30: Non-GAAP reconciliation continued: efficiency ratio
Non-GAAP reconciliation continued: Non-interest income, non-interest expense and efficiency ratio NM - Not Meaningful 30 Nine Months Ended September 30 ($ amounts in millions) 2017 2016 2017 vs. 2016 ADJUSTED EFFICIENCY, FEE INCOME AND OPERATING LEVERAGE RATIOS, ADJUSTED NON-INTEREST INCOME/ EXPENSE
Slide 31: Non-GAAP reconciliation: pre-tax pre-provision income
Non-GAAP reconciliation: pre-tax pre-provision income Pre-Tax Pre-Provision Income ("PPI") and Adjusted PPI (non-GAAP) The Pre-Tax Pre-Provision Income table below presents computations of pre-tax pre-provision income from continuing operations excluding certain adjustments (non-GAAP). Regions belie
Slide 32: Adjusted allowance for loan losses to non-performing loans
The table below presents computations of the adjusted allowance for loan losses to non-performing loans, excluding loans held for sale ratio (non-GAAP), generally calculated as adjusted allowance for loan losses divided by adjusted total non-accrual loans, excluding loans held for sale. The allowanc
Slide 33: Non-GAAP reconciliation: YTD return on tangible equity and EPS
Non-GAAP reconciliation: YTD return on average tangible stockholders' equity and earnings per common share from continuing operations The tables below present computations of "adjusted net income from continuing operations available to common shareholders," "adjusted return on average tangible commo
Slide 34: Forward-looking statements
Forward-looking statements This presentation may include forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. The terms “Regions,” the “Company,” “we,” “us” and “our” mean Regions Financial Corporation, a Delaware corporation, and its subsidiaries when or wh
Slide 35: Forward-looking statements risk factors
Our ability to execute on our strategic and operational plans, including our ability to fully realize the financial and non-financial benefits relating to our strategic initiatives. • The success of our marketing efforts in attracting and retaining customers. • Possible changes in consumer and busin
Slide 36: Regions
A REGIONS
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