Regions Financial Corporation · NYSE:RF
Regions Financial — Goldman Sachs U.S. Financial Services Conference 2016
25 slides from Regions Financial's conference presentation, Dec 5, 2016
Slide 1: Goldman Sachs U.S. Financial Services Conference
Goldman Sachs U.S. Financial Services Conference Grayson Hall, Chairman and CEO December 6, 2016 EXHIBIT 99.1
Slide 2: Regions' markets
Regions Branches Regions Insurance Regions’ markets 2 *As of 6/30/16 based on FDIC deposit data 15 State Footprint Atlanta Houston St. Louis Core Deposit States Priority Growth Cities Total deposits in core states 78% Charlotte Dallas
Slide 3: Unique strengths
Unique strengths 3 Execution Disciplined approach to financial and risk management Culture Team Markets Shared Value is the foundation of our culture Regions benefits when our customers prosper Focus on customer needs Improving associate engagement Attracting, retaining and developing tale
Slide 4: Strength of culture
4 Strength of culture Most Reputable Bank in the U.S. (2016) Gallup Great Workplace Award (2016) Regions has been recognized for executing on our strategy to “Build the Best Team” which includes creating a work environment that supports productivity and retention through engagement This workplace en
Slide 5: Key assumptions & operating environment
Key assumptions & operating environment 5 Economy is expected to continue to improve at modest pace, with consumer spending the main driver of top-line GDP growth. Potential changes to fiscal and regulatory policy pose both upside and downside risks to growth; however, we believe there is more possi
Slide 6: Revenue mix update
6 Revenue mix update 64% 36% (1) Adjusted non-GAAP; see appendix for reconciliation $5.3B $4.2B Full Year 2015 September 2016 YTD 62% 38% Net Interest Income and Other Financing Income (FTE) Non Interest Income (1) (1)
Slide 7: Favorable balance sheet positioning
7 Favorable balance sheet positioning 57% 43% Variable Fixed Naturally asset-sensitive balance sheet Primarily core deposit funded Inclusive of interest rate swaps, the portfolio consists of 46% variable and 54% fixed rate loans as of 3Q16 Asset sensitive under a range of deposit pricing scenarios W
Slide 8: Well-positioned deposit base is a competitive advantage
36% 27% 21% 8% 8% Interest-free Money market Interest-bearing checking Time Savings $98B 56% 29% 11% 4% Consumer Segment Corporate Bank Segment Wealth Management Segment Other Well-positioned deposit base is a competitive advantage Deposits – Composition(1) Deposits – by Segment(1) (1) 3Q16 average
Slide 9: Non-interest income mix
9 Non-interest income mix 34% 20% 19% 8% 5% 14% Full Year 2015(1) 31% 20% 19% 8% 8% 14% Service charges Wealth Management Income Card and ATM fees Mortgage Income Capital Markets Other September 2016 YTD(1) Non-Interest Income Initiatives Year-to-date Growth in checking accounts and households Incre
Slide 10: Committed to improving efficiencies
Committed to improving efficiencies Customer Experience and Products Digitizing the Workforce Processes and Efficiency Leveraging and improving technology to improve efficiencies Elimination of core expenses of $400 million through 2019 Represents ~11.5% of 2015 adjusted expense base Evaluating oppo
Slide 11: Investing in our future
11 Investing in our future Revenue Investments Other Investments • GreenSky® • Online Direct Lending (Avant) • Additional Point-of-Sale Opportunities • Mortgage MSR Purchases • Mortgage Loan Officer Adds • Home Loan Direct Mortgage Channel • Platform Associate Adds • Cross channel sale and service i
Slide 12: Sound credit risk management
Sound credit risk management 12 EVERYONE is a risk manager The Team is committed Business Strategy Risk Appetite Financial Results Ensuring Regions’ business strategy is aligned with its appetite for risk Balance and diversity is key to proper risk management Net-charge offs Expectations 2016 YTD 25
Slide 13: 2016 Expectations
2016 Expectations 13 (1) 4Q16 average balances relative to 4Q15 average balances Note: The reconciliation with respect to these forward-looking non-GAAP measures is expected to be consistent with the actual non-GAAP reconciliations included in the attached appendix. 2016 Expectations at Investor Day
Slide 14: Capital position
Capital position 14 9.1% 9.5% 9.6% 9.8% 9.8% 10.0% 10.1% 10.1% 10.2% 10.6% 10.7% [VALUE] [VALU E] 12.0% Peer #13 Peer #12 Peer #11 Peer #10 Peer #9 Peer #8 Peer #7 Peer #6 Peer #5 Peer #4 Peer #3 Peer #2 Peer #1 Dividends Organic Growth Strategic Investments Share Repurchases Capital priorities Comm
Slide 15: 2016-2018 Long-term expected results
2016-2018 Long-term expected results 15 Adjusted EPS growth of 12-15% (CAGR) Adjusted efficiency ratio of <60% by 2018 Adjusted ROATCE 12-14% by 2018
Slide 16: Solid shareholder return
Solid shareholder return 16 16% 18% 21% 21% 22% 23% 25% 31% 33% 35% 42% 45% 51% 69% Peer #13 Peer #12 Peer #11 Peer #10 Peer #9 Peer #8 Peer #7 Peer #6 Peer #5 Peer #4 Peer #3 Peer #2 Peer #1 11% 16% 17% 20% 20% 21% 23% 28% 31% 32% 36% 36% 37% 46% Peer #13 Peer #12 Peer #11 Peer #10 Peer #9 Peer #8
Slide 17: 2017 Expectations
2017 Expectations 17 Full year average loan growth low single digits Full year average deposits growth low single digits Net interest income and other financing income up 2% - 4% Adjusted non-interest income growth 3% - 5% Adjusted expenses 0% - 1%; full year efficiency ratio ~62% Adjusted operating
Slide 18: Strategic initiatives
Strategic initiatives Optimize and Effectively Deploy Regulatory Capital Attractive ROA and Risk Adjusted Returns Return appropriate capital to shareholders Disciplined Expense Management $400mm in expense saves by 2019 Continuously focus on efficiency and effectiveness Generate positive o
Slide 19: Executing our strategic initiatives
Executing our strategic initiatives 19 Grow and Diversify Revenue Disciplined Expense Management Optimize and Effectively Deploy Regulatory Capital Efficiency Challenge Integration of Acquisitions Balance Sheet Optimization Expansion of Key Lending Partnerships Syndication Build-out Retail Network S
Slide 20: Appendix
Appendix Mx REGIONS 20,
Slide 21: Non-GAAP reconciliation: YTD Non-interest income, non-interest expense, efficiency ratio
Non-GAAP reconciliation: YTD Non-interest income, non-interest expense, efficiency ratio, fee income ratio and operating leverage Nine Months Ended September 30 ($ amounts in millions) 2016 2015 2016 vs. 2015 ADJUSTED EFFICIENCY, FEE INCOME AND OPERATING LEVERAGE RATIOS, ADJUSTED NON-INTEREST INCOME
Slide 22: Non-GAAP reconciliation continued: Non-interest income, non-interest expense
Non-GAAP reconciliation continued: Non-interest income, non-interest expense, fee income ratio and efficiency ratio 22 Year Ended December 31 ($ amounts in millions) 2015 ADJUSTED EFFICIENCY AND FEE INCOME RATIO, ADJUSTED NON-INTEREST INCOME/EXPENSE- CONTINUING OPERATIONS Non-interest expense (GAAP)
Slide 23: 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 24: Forward-looking statements continued
Forward-looking statements continued 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 fo
Slide 25: A. REGIONS
A. REGIONS
Regions Financial — Goldman Sachs U.S. Financial Services Conference 2016 on 6ix