Regions Financial Corporation · NYSE:RF
Regions Financial — Merrill Lynch 2007 Banking and Financial Services Conference
34 slides from Regions Financial's conference presentation, Nov 13, 2007
Slide 1: Merrill Lynch 2007 Banking and Financial Services Conference
Merrill Lynch 2007 Banking and Financial Services Conference November 13, 2007 Exhibit 99.1
Slide 2: Forward Looking Statements
FORWARD LOOKING STATEMENTS The information contained in this presentation may include forward-looking statements which reflect Regions' current views with respect to future events and financial performance. The Private Securities Litigation Reform Act of 1995 ("the Act") provides a safe harbor for f
Slide 3: Company Profile
Company Profile Company Profile Integration Update 3Q07 Financial Performance 2008-2010 Strategic Initiatives Summary
Slide 4: Regions is Among the Largest U.S. Banks
Regions is Among the Largest U.S. Banks Market Capitalization $21 billion 13th Assets $138 billion 12th Loans, net of unearned income $94 billion 10th Deposits $93 billion 10th Branches 2,022 7th ATMs 2,549 8th National Rank ¹ As of September 30, 2007.
Slide 5: Franchise Footprint
Franchise Footprint Source: SNL DataSource and Regions as of June 30, 2007 State Dep. ($B) Mkt. Share Rank AL $18.2 25% #1 FL 17.7 #4 TN 16.7 #2 LA 7.6 #3 MS 6.2 #1 GA 5.5 #6 AR 4.3 #2 TX 3.0 #18 IL 2.4 #24 MO 2.3 #8 IN 2.0 #9 Other 2.4 — — Regions Morgan Keegan Insurance
Slide 6: Regions compares favorably in local market share relative to other top 10 banks
Regions compares favorably in terms of local market share relative to other top 10 banking franchises 18.5 Regions Deposit weighted by county. Excludes deposits from branches with > $10bn of deposits. Based on June 30, 2007 data. 16.6% Median 7.9 Citigroup 13.2 National City 14.3 SunTrust 16.0 JP Mo
Slide 7: Fast Growing Footprint
Fast Growing Footprint 10.5% 10.0% 8.1% 8.0% 7.9% 7.0% 6.9% 5.9% 5.7% 4.5% 4.2% 3.7% 3.4% 3.4% 3.3% 2.8% 0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% Projected Population Growth (2007-2012) of Market Footprint (1) Source: SNL Financial. Data as of June 2007. Pro forma for completed/pending M&A. (1) Deposit
Slide 8: Morgan Keegan – Among the Largest Regional Full-Service Brokerage Firms
Morgan Keegan – Among the Largest Regional Full-Service Brokerage and Investment Banking Firms Revenue ($M) Pre-Tax Income ($M) Financial Performance 430 Office Locations Revenue Composition (3Q ’07) Profile Founded in 1969 Acquired by Regions in 2001 1,300 financial advisors 430 offices in 19 state
Slide 9: Integration Update
Integration Update Company Profile Integration Update 3Q07 Financial Performance 2008-2010 Strategic Initiatives Summary
Slide 10: Key Integration Accomplishments
Key Integration Accomplishments Established Matrix Organizational Structure Completed Branch Divestitures Converted Brokerage, Mortgage, Payroll, Employee Benefits and Trust Systems Completed Alabama, Florida, Louisiana, Mississippi, and Tennessee Branch Conversions Branch Consolidations Substantial
Slide 11: Integration Timeline
Integration Timeline Combined Product Set & Incentives Complete Sale of Divested Branches 1Q07 2Q07 3Q07 4Q07 Brokerage Conversion Mortgage Origination & Servicing Conversion Trust Conversion Event Two Branch Conversion and Consolidations Event Three Branch Conversion and Consolidations Event One Br
Slide 12: Branch Conversion Events by State
FL AL GA MS LA TX AR MO IA IL IN KY TN NC VA SC Event 1 July 13, 2007 (677 branches) Event 2 October 26, 2007 (612 branches) Event 3 December 7, 2007 (656 branches)
Slide 13: Branch Consolidations Substantially Complete
Branch Consolidations Substantially Complete Tennessee Missouri Georgia Mississippi Louisiana Alabama Florida 15 branches consolidated pre-conversion in Arkansas, Florida, Missouri and Tennessee Significant source of cost saves Total of 159 branches consolidated Event 1 Event 2 Event 3 Completed Pen
Slide 14: Exceeding Original Cost Saves
Exceeding Original Cost Saves Net Cost Saves $0 $100 $200 $300 $400 $500 2008E 2007E 4Q06 $7 MM Estimated $300 MM Estimated $500 MM Full run-rate achieved by 2Q 2008 $237 MM through 3Q07
Slide 15: Measuring the Customer Experience
Measuring the Customer Experience Measurement Plans Gallup Organization, Greenwich Organization and Customer Surveys Trend Identification Tracking over 100 operational metrics
Slide 16: 3Q07 Financial Performance
3Q07 Financial Performance Company Profile Integration Update 3Q07 Financial Performance 2008-2010 Strategic Initiatives Summary
Slide 17: Solid Financial Performance
Solid Financial Performance Merger integration goals ahead of schedule; branch conversions to be completed by year-end Cost saves continue to exceed expectations Banking environment remains challenging Credit costs, while higher, remain at reasonable levels Morgan Keegan reports continued solid resu
Slide 18: 3Q07 Financial Summary
3Q07 Financial Summary Financial Performance $ 0.64 EPS – diluted* 0.27 % Net Charge-Off Ratio Asset Quality 0.62 % Nonperforming Assets as a % of Loans 1.19 % Allowance for Credit Losses as a % of Loans 23.03 % Return on Avg. Tangible Equity* 1.31 % Return on Avg. Assets* 57.7 % Operating Efficienc
Slide 19: Credit Quality Trends
Credit Quality Trends 0.27% 0.20% 0.23% 0.27% 0.62% 0.62% 0.45% 0.40% 0.15% 0.22% 0.22% 0.35% 0.00% 0.20% 0.40% 0.60% 0.80% 4Q06 1Q07 2Q07 3Q07 NPAs/Loans and OREO Net Charge-Offs/Average Loans Delinquent Loans (90+ Past Due)
Slide 20: Diversified Loan Portfolio
Diversified Loan Portfolio Note: Loan Portfolio per Call Report Schedule RC-C. September 30, 2007. Loan Portfolio Total Loan Portfolio as of 9/30/07 ($MM) = $94,374 Other Commercial Real Estate, 9% Multifamily, 1% Commercial/Leasing, 23% Alt A, 4% Home Equity, 16% Other Consumer, 2% Owner Occupied R
Slide 21: Commercial Real Estate
Commercial Real Estate CRE Portfolio by Product CRE Portfolio Characteristics CRE portfolio is diversified by product, loan size, and by geography CRE portfolio is very granular with the average note size under $500 thousand This average note size is reflective of real estate in our Community Banks
Slide 22: Consumer Real Estate Portfolio
Consumer Real Estate Portfolio Average Loan Size = $118 thousand 71% are first lien position Weighted Average LTV FICO Total Portfolio 70% Alt A 78% Negligible subprime exposure (0.1 %) No negative amortizing mortgages No Option Adjustable Rate Mortgages EquiFirst sold 1Q2007 Residential First Mortg
Slide 23: Strong Capital Position
Strong Capital Position 6.9% 6.8% 6.6% 6.3% 6.0% 5.5% 5.4% 5.4% 5.3% 5.2% 4.2% 0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0% 7.0% Tangible Equity / Tangible Assets Source: SNL DataSource, Tangible Equity/Tangible Assets as of September 30, 2007. 5.5% Median
Slide 24: 2008-2010 Strategic Initiatives
2008-2010 Strategic Initiatives Company Profile Integration Update 3Q07 Financial Performance 2008-2010 Strategic Initiatives Summary
Slide 25: Strategic Focus Areas
Strategic Focus Areas Performance Optimization Efficiency and Productivity Customer Experience
Slide 26: Enterprise-wide Strategic Initiatives
Enterprise-wide Strategic Initiatives Leverage full depth of Morgan Keegan capabilities among all Lines of Business Grow the emerging and mass affluent customer segment through a fully integrated approach Increase core customer deposits to optimize the profitability of balance sheet growth Enhance o
Slide 27: Consumer Services
Consumer Services Enhance branch network performance Grow customer deposits profitably Maximize consumer lending opportunities Increase number of affluent households Infuse consistent service quality throughout organization
Slide 28: Business Services
Business Services All Business Services Business Banking Commercial & Industrial Diversify revenue stream through team-based delivery Fully implement segmentation and execute relationship management model Execution of a team-based client management model Expand Capital Markets’ capabilities Leverage
Slide 29: Business Services
Business Services Community Banking Insurance Enable local Relationship Managers to deliver the bank’s capabilities with centralized support Develop deposit-based value packages of simplified Treasury Management products Align centralized underwriting and management capabilities to meet market needs
Slide 30: Morgan Keegan
Morgan Keegan Grow Equity Capital Markets and Fixed Income Capital Markets Grow Private Client Group revenue Develop a partnership with Private Banking Develop programs to address the needs of emerging and mass affluent customers in cooperation with Consumer Services Adjust platform program to deliv
Slide 31: Financial Performance
Financial Performance Strong Growth Driven by Strategic Initiatives Loans Deposits Continued Strong Liquidity and Capital Ratios Stable Credit Quality Neutral Interest Rate Risk Profile
Slide 32: Summary
Summary Company Profile Integration Update 3Q07 Financial Performance 2008-2010 Strategic Initiatives Summary
Slide 33: Challenging Banking Environment
Challenging Banking Environment Regions is well positioned despite challenging operating environment: Relatively neutral balance sheet positioning Credit risks manageable Strong Morgan Keegan results Merger opportunities mitigate industry downturn, allow for increased operating leverage Exceeding me
Slide 34: Regions
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