Regions Financial Corporation · NYSE:RF
Regions Financial — Q1 2014 Earnings Presentation
16 slides from Regions Financial's earnings presentation, Apr 22, 2014
Slide 1: 1st Quarter 2014 Earnings Conference Call
1st Quarter 2014 Earnings o Conference Call April 22, 2014 Exhibit 99.3
Slide 2: A solid start to 2014
A solid start to 2014 1Q14 Results ‣Net income available to common shareholders of $311 million or $0.22 per diluted share ‣Experienced $1.1 billion in loan growth ‣Overall expenses declined 14%; adjusted expenses(1) declined 4% ‣Net charge-off ratio of 0.44% - lowest level since 3Q07 2 1Q14 Accompl
Slide 3: Loans
Loans • Loan growth continues to be driven by business lending • Commercial and industrial loans increased 4% • Commercial line utilization increased 170 basis points and commitments for new loans increased 2% to $39 billion • Investor real estate loans increased for the first time in over 4 years •
Slide 4: Deposits and funding costs
4 • Total average deposits increased $874 million from the fourth quarter • Low-cost deposits increased to 90% of total average deposits • Deposit costs remain at historical low of 12 basis points • Total funding costs declined 1 basis point to 33 basis points • Continue to expect 2014 deposit growt
Slide 5: Net interest income and net interest margin
Net interest income and net interest margin • Net interest income (FTE) decreased 2% from prior quarter, attributable to fewer days in the quarter and impact of low interest rate environment on loan yields • Net interest margin remained steady from previous quarter, largely reflecting offsetting imp
Slide 6: Non-interest revenue
Non-interest revenue • Non-interest revenue down $88 million from fourth quarter; however, fourth quarter included benefits of $56 million • Service charges down, driven by lower seasonal trends and continued changes in customer behavior • As expected, mortgage income declined; mortgage production d
Slide 7: Expenses
Expenses • Adjusted expenses(1) declined 4% from 4Q • Troubled debt restructuring (TDR) sale was finalized and actual expenses were $35 million less than initially estimated • Salaries and benefits declined 2% - seasonal increases in payroll taxes offset by lower benefits and staffing levels • Legal
Slide 8: Asset quality
Asset quality Net charge-offs and ratio ($ in millions) NPLs and coverage ratio(2) ($ in millions) Criticized and classified loans(3) ($ in millions) Troubled debt restructurings ($ in millions) 127 151 $180 $144 $114 $278 $82 0.99% 0.77% 0.60% 0.67% 0.44% 1Q13 2Q13 3Q13 4Q13 1Q14 Net Charge-Offs re
Slide 9: Capital and liquidity
Capital and liquidity Tier 1 capital ratio(1) Loan to deposit ratio(3) Tier 1 common ratio(1)(2) (1) Current quarter ratios are estimated (2) See GAAP to non-GAAP reconciliation in appendix (3) Based on ending balances 12.4% 11.6% 11.5% 11.7% 11.9% 1Q13 2Q13 3Q13 4Q13 1Q14 11.2% 11.1% 11.0% 11.2% 11
Slide 10: Appendix
Appendix Ms REGIONS 10
Slide 11: Non-GAAP reconciliation: Non-interest expense
Non-GAAP reconciliation: Non-interest expense The table below presents non-interest expense (GAAP) excluding certain adjustments to arrive at adjusted non-interest expense (non-GAAP). Regions believes that the exclusion of these adjustments provides a meaningful base for period-to-period comparisons
Slide 12: Non-GAAP reconciliation: Net charge-off ratio
Non-GAAP reconciliation: Net charge-off ratio Select calculations for annualized net charge-offs as a percentage of average loans are presented in the table below. During the fourth quarter of 2013, Regions made the strategic decision to transfer certain primarily accruing restructured residential f
Slide 13: Non-GAAP reconciliation: Tier 1 common
Non-GAAP reconciliation: Tier 1 common The following table provides calculations of Tier 1 capital (regulatory) and "Tier 1 common equity" (non-GAAP). Traditionally, the Federal Reserve and other banking regulatory bodies have assessed a bank's capital adequacy based on Tier 1 capital, the calculati
Slide 14: Non-GAAP reconciliation: Basel III common equity tier 1
Non-GAAP reconciliation: Basel III common equity tier 1 The following table provides calculations of "Common equity Tier 1" (CET1), based on Regions’ current understanding of the Final Basel III requirements. In December 2010, the Basel Committee on Banking Supervision (the “Basel Committee”) releas
Slide 15: Forward-looking statements
Forward-looking statements The foregoing list of factors is not exhaustive. For discussion of these and other factors that may cause actual results to differ from expectations, look under the captions “Forward-Looking Statements” and “Risk Factors" of Regions' Annual Report on Form 10-K for the year
Slide 16: A. REGIONS
A. REGIONS