Regions Financial Corporation · NYSE:RF
Regions Financial — BancAnalysts Association of Boston Conference 2018
21 slides from Regions Financial's conference presentation, Nov 9, 2018
Slide 1: BancAnalysts Association of Boston Conference
BancAnalysts Association of Boston Conference November 9, 2018
Slide 2: Solid Third Quarter 2018 Results
Solid Third Quarter 2018 Results Highlights 3Q18 YoY • Produced broad-based high quality loan Result Change(1) ($ in millions, except per share amounts) growth Net income from $354 20% continuing operations(2) • Continued benefit from asset sensitive balance sheet Earnings per share $0.32 28% • Deli
Slide 3: Managing for long-term performance
Managing for long-term performance Opportunities to drive growth and efficiencies Asset sensitivity Capital return Significant funding advantage Capital sufficient for organic driven by loyal and low-cost growth, strategic investments, & deposit base; accretive fixed- robust shareholder returns rate
Slide 4: Interest rate sensitivity
Interest rate sensitivity (as of September 30, 2018) Portfolio compositions Assets Other Liabilities 15% Securities Deposits Borrowings 19% $125B 85% $110B 13% Loans 66% Other 2% Loans(1)(2) Deposits Wholesale Borrowings(1) Time Fixed Fixed 7% 10% 50% Non-Interest $82B Bearing $93B IB Checking, Mone
Slide 5: Deposit advantage
Deposit advantage Expected to continue Average deposits by customer type 3Q18 vs. 3Q15 change in interest bearing deposit costs(1) (Retail vs. Business) RF 27bps 3Q18, ($ in billions) Peer #1 28bps Peer #2 36bps Private Institutional Wealth(2) Services(2) Peer #3 37bps $7 $1 Peer #4 41bps Peer #5 42
Slide 6: Increasing net interest income and net interest margin
Increasing net interest income(1) and net interest margin Highlights Net interest income(1) and margin • 3Q18 NII(1) (non-FTE) increased $16M ($ in millions) QoQ; NIM increased 1 bp to 3.50% $955 $938 13 $920 12 942 • NIM is 16 bps above the 3Q18 peer 23 926 median 897 3.49% 3.50% • NII and NIM bene
Slide 7: Asset quality remains benign
Asset quality remains benign Criticized ($ in millions) business loans NPLs and coverage ratio ($ in millions) $2,962 $760 $650 $2,456 $601 $595 941 $2,223 $539 $2,029 1,007 $1,908 925 156% 857 1,048 144% 137% 140% 141% 2,021 1,449 1,298 1,051 981 3Q17 4Q17 1Q18 2Q18 3Q18 3Q17 4Q17 1Q18 2Q18 3Q18 Cl
Slide 8: Asset quality remains benign (continued)
Asset quality remains benign (continued) Net charge-offs and ratio Accruing 90+ days past due ($ in millions) ($ in millions) $84 $167 $82 $76 5 $151 6 30 $138 $137 26 9 29 $129 $63 $62 6 6 5 10 18 0.42% 0.40% 0.38% 0.31% 0.40% 0.32% 161 142 132 131 124 53 53 52 47 44 3Q17 4Q17 1Q18 2Q18 3Q18 3Q17 4
Slide 9: Strong capital levels
Strong capital levels Common equity Tier 1 ratio – Capital priorities Fully phased-in pro-forma(1)(2) 11.2% 11.0% 11.0% 10.9% 10.1% 3Q17 4Q17 1Q18 2Q18 3Q18 (1) Current quarter ratios are estimated (2) Non-GAAP; see appendix for reconciliation 9
Slide 10: Simplify and Grow
Simplify and Grow A continuous journey Making banking easier Organization simplification • Digitization • Organizational structure review • Loan process • Spans and layers review • Account opening • Streamline committees and decision • Streamline credit process; more making digital; faster response
Slide 11: Simplify and Grow: progress update
Simplify and Grow: progress update A continuous journey Initial efficiency and revenue review ~ 45 initiatives underway aimed at.... Through the initial review making banking easier 30% opportunities identified represent ~70% expense growing revenue 70% savings and ~30% revenue improving efficiencie
Slide 12: Simplify and Grow: investing for growth
Simplify and Grow: investing for growth A continuous journey • Investing in talent and growth markets ◦ Hiring new bankers ◦ Adding talent in capital markets and digital banking ◦ Adding branches in targeted growth markets • Streamlining processes ◦ Accelerated commercial response time ~70% ◦ Digiti
Slide 13: Growing customer relationships
Growing customer relationships Focused on fundamentals • Consumer checking accounts grew 1.4% YTD • Consumer NIB checking increased 5% and savings increased 7%(1) • Active consumer credit cards grew 6% and the penetration rate increased by 77 bps(1) • Wealth Management relationships grew 27%(1) • To
Slide 14: 2018 full-year expectations
2018 full-year expectations • Adjusted ROATCE of approximately 16%(1)(2) • Full-year adjusted average loans are expected to grow in the low single digits(1) • Full-year average deposits are expected to remain relatively stable, excluding brokered and Wealth Institutional Services deposits(3) • Adjus
Slide 15: Appendix
Appendix Am REGIONS
Slide 16: Non-GAAP reconciliation: pre-tax pre-provision income
Non-GAAP reconciliation: pre-tax pre-provision income The Pre-Tax Pre-Provision Income (PPI) tables below present computations of pre-tax pre-provision income from continuing operations excluding certain adjustments (non-GAAP). Regions believes that the presentation of PPI and the exclusion of certa
Slide 17: Non-GAAP reconciliation: adjusted net charge-offs
Non-GAAP reconciliation: adjusted net charge- offs Adjusted Net Charge-offs and Ratios (non-GAAP) Select calculations for annualized net charge-offs as a percentage of average loans (GAAP) are presented in the table below. During the first quarter of 2018, Regions made the strategic decision to sell
Slide 18: Non-GAAP reconciliation: Basel III common equity tier 1 ratio
Non-GAAP reconciliation: Basel III common equity tier 1 ratio – fully phased-in pro-forma The calculation of the fully phased-in pro-forma "Common equity Tier 1" (CET1) is based on Regions’ understanding of the Final Basel III requirements. For Regions, the Basel III framework became effective on a
Slide 19: Forward-looking statements
Forward-looking statements Forward-Looking Statements This release may include forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995, which reflect Regions’ current views with respect to future events and financial performance. Forward-looking statements are n
Slide 20: Forward-looking statements continued
Forward-looking statements continued • 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 risks and uncertainties related to our acquisition or divestiture of busi
Slide 21: Regions
A REGIONS Me REGIONS »
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