Regions Financial Corporation · NYSE:RF
Regions Financial — Q1 2015 Earnings Presentation
16 slides from Regions Financial's earnings presentation, Apr 21, 2015
Slide 1: 1st Quarter Earnings Conference Call
1st Quarter Earnings Conference Call April 21, 2015
Slide 2: Solid start to 2015
Solid start to 2015 Successfully executing strategic priorities All areas within wealth grew 1Q15 4Q14 Change revenue ($ in millions, except per share data) Revenue Will continue to target lift‐out and acquisition opportunities Net Income(1) $218 $200 9% diversification within insurance Grew c
Slide 3: Loans
Loans Ending loan balances ($ in billions) For the quarter: $78.2 Ending loan balances up $936MM or 1% $77.3 Business lending balances increased 2% $76.5 $76.6 Investor real estate increased 2% $75.7 Commercial and industrial grew 3% Line utilization increased 10 basis points and commitmen
Slide 4: Deposits and funding costs
Deposits and funding costs Ending deposit balances Average deposit balances ($ in billions) ($ in billions) $97.5 $95.8 $94.0 $94.0 $94.1 $94.2 $93.8 $92.9 $93.0 $93.4 1Q14 2Q14 3Q14 4Q14 1Q15 1Q14 2Q14 3Q14 4Q14 1Q15 Deposit costs Funding costs 12 bps 11 bps 11 bps 11 bps 12 bps 33 bps 31 bps 30 bp
Slide 5: Net interest income and net interest margin
Net interest income and net interest margin Net interest income on a FTE basis $838 $837 $837 declined $5 million or 1% $832 $831 Low rate environment and fewer days in the quarter were principal 3.26% drivers of decrease, but were 3.24% partially offset by increases in 3.18% 3.17% 3.18% average
Slide 6: Non-interest income
Non‐interest income Mortgage income increased 48% as loan production increased, along with $497 improvement in the market valuation $475 $474 $470 of mortgage servicing rights $457 102 Wealth Management revenue 84 103 86 76 increased 8% led by higher insurance commissions, higher investment 90 9
Slide 7: Adjusted non-interest expenses
Adjusted non‐interest expenses(1) Adjusted non‐interest expenses(1) declined 2% $859 Expenses included some significant items $846 $840 Redeemed $250 million of higher cost debt and $827 $826 incurred $43 million of extinguishment charges Recorded $13 million of expense related to branch con
Slide 8: Asset quality
Asset quality Net charge‐offs and ratio NPLs and coverage ratio(1) ($ in millions) ($ in millions) $82 $75 $83 $1,070 $67 $54 $899 $837 $829 $800 0.44% 0.39% 0.42% 141% 133% 137% 0.35% 0.28% 118% 137% 1Q14 2Q14 3Q14 4Q14 1Q15 1Q14 2Q14 3Q14 4Q14 1Q15 Net Charge‐Offs Net Charge‐Offs ratio NPLs Covera
Slide 9: Capital and liquidity
Capital and liquidity Tier 1 capital ratio(1)(2)(3) Repurchased $102 million of shares of 12.5% 12.7% 12.5% common stock, completing the $350 million 11.8% 12.0% program that was part of 2014 CCAR Transitional basis Basel III Common Equity Tier 1 ratio estimated to be approximately 11.2%(1), whi
Slide 10: Expectations for 2015
Expectations for 2015 Economy Loans Deposits Economic growth expected Expect total loan growth in the Expect full year average balance to pick up over the 4% to 6% range on a point‐to‐ growth of 1% to 2% remainder of the year point basis NIM / Operating Continued improvement in Commercial
Slide 11: Appendix
Appendix Av REGIONS 11
Slide 12: Energy lending
Energy lending Energy Loan Portfolio Outstandings Experienced team of bankers, risk managers and petroleum engineers on ($ in millions) As of 3/31/15 staff Oilfield Services and supply $1,192 Exploration and production Regions’ Exploration and Production (E&P) (Upstream) $1,123 and Oil Field Ser
Slide 13: Non-GAAP reconciliation: Non-interest expense and efficiency ratio
Non‐GAAP reconciliation: Non‐ interest expense and efficiency ratio 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 uses this ratio to monitor performance a
Slide 14: Non-GAAP reconciliation: Basel III common equity Tier 1 ratio – fully phased-in pro-forma
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 15: Forward-looking statements
Forward-looking statements This presentation 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 not based on historica
Slide 16: A. REGIONS
A. REGIONS