Regions Financial Corporation · NYSE:RF
Regions Financial — Bank of America Merrill Lynch Banking & Financial Services Conference (November 2010)
31 slides from Regions Financial's conference presentation, Nov 16, 2010
Slide 1: Bank of America Merrill Lynch Banking & Financial Services Conference
Bank of America Merrill Lynch Banking & Financial Services Conference EXHIBIT 99.1
Slide 2: Forward-Looking Statements
Forward-Looking Statements 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 forward-looking statements w
Slide 3: Primary focus is returning to sustainable profitability
Our primary focus is returning to sustainable profitability through disciplined execution of our strategic priorities
Slide 4: Why Regions?
Why Regions? Strong Southeastern franchise with comprehensive line of business offerings Solid core business performance Aggressively identifying and disposing of problem assets Capital and liquidity remain solid
Slide 5: Strong Southeastern Franchise
Strong Southeastern Franchise Ranked th or Better in Market Share Targeted Growth Areas Headquarters Birmingham, AL Associates 27,898 Branches 1,774 Morgan Keegan Offices Regions Insurance Offices ATMs 2,150 Deposits $95 Billion Loans $84 Billion Projected population growth for Regions footprint is
Slide 6: Consumer Services
Consumer Services Credit/Debit Cards On-line Banking Mobile Banking
Slide 7: Business Services
Middle Market Small Business Real Estate Treasury Management Capital Markets / Syndications Equipment Finance Commercial Real Estate Affordable Housing Homebuilders Real Estate Corporate Banking Specialized Groups Core Middle Market Branches Relationship Managed Business Banking (Metro Markets) Comm
Slide 8: Morgan Keegan and wealth businesses
Private Client Group Fixed Income Capital Markets Equity Capital Markets Municipal Finance, M&A Equity Research, Institutional Sales & Trading Credit Products (including Securities Based Lending), Wealth Solutions Personal & Institutional Trust, Timber Management Public Offerings, Corporate Debt Ins
Slide 9: Excellent Service
Excellent Service Quality is the Foundation for Growth Excellent - Gallup 90th percentile Good - Gallup 75th percentile Average - Gallup 50th percentile Excellent - Gallup 90th percentile Average - Gallup 50th percentile Good - Gallup 75th percentile 1Q08 2Q09 2Q10 1Q08 2Q09 2Q10 Regions Ranked in T
Slide 10: Strong Low-Cost Deposit Growth
Strong Low-Cost Deposit Growth While Driving Lower Deposit Costs Average Low Cost Deposits $7.7 Billion YOY Growth Deposit Costs Improved 56 bps
Slide 11: Improved Deposit Mix
Reduced Average Time Deposit mix from 34% in 3Q09 to 26% in 3Q10 Grew Low-Cost Deposits 12.4% year-over-year Improved Deposit Mix Average Deposits $94.8 B Average Deposits $95.1 B
Slide 12: Disciplined Focus on New Checking Account Growth
4 Q Disciplined Focus on New Checking Account Growth On track to open 1 Million New Checking Accounts in 2010 Account structure that provides quality products and services that customers value and at the same time fairly compensates Regions Net New Account Growth could slow as we migrate to fee gene
Slide 13: Consumer Loan Production Improving
Consumer Loan Production Improving; However Consumers Continue to De-Leverage Mortgage Production remains strong – on track for second best year in terms of Mortgage Production New Consumer Loan Production volumes are improving in Branch Small Business, Direct and Indirect Auto Consumers De-Leveragi
Slide 14: Business Services Revenue is Well-Diversified
Business Services Revenue is Well-Diversified Middle Market C&I Specialized Groups Commercial Real Estate Professional income property developers, owners and operators Public real estate companies Homebuilders Affordable housing tax credits Small Business Business Banking (Metro Markets) Community B
Slide 15: We Are Growing Commercial Loans
We Are Growing Commercial Loans
Slide 16: Net interest margin
Net interest margin climbed 9bps linked quarter; up 24 bps year-to-date Repricing opportunity remains with over $11.4 billion of CD’s maturing over the next 9 months at an average rate of 2.10% Steady loan yields despite declining market rates Hedges in place through end of 2012 to protect net inter
Slide 17: Growth of Fee Income and Debit Card Interchange
Growth of Fee Income and Debit Card Interchange Offsets Reg E Impact
Slide 18: Strengthened Core Franchise Through Productivity & Efficiency
*Non-GAAP; refer to Appendix for Non-GAAP reconciliation ($ in millions) Sep YTD Branches 1,965 1,900 1,895 1,774 Reduced branch count by 10% since 2007 Headcount 33,161 30,784 28,509 27,898 Headcount declined 5,263 or 16% Total Expenses $4,660 $10,792 $4,751 $3,719 Adjusted Expenses* $4,246 $4,448
Slide 19: Disposed of Over $5 Billion in Problem Assets
Disposed of Over $5 Billion in Problem Assets in Past 24 Months $228 $281 $554 $643 $1,039 $689 $779 $1,041 Problem Asset Dispositions Note: Dispositions include loans sold or moved to held for sale. The 09/30/10 balance in held for sale was $393MM. $0 $300 $600 $900 $1,200 4Q08 1Q09 2Q09 3Q09 4Q09
Slide 20: Higher Risk Portfolio Segments Significantly Reduced
Higher Risk Portfolio Segments Significantly Reduced Total Investor Real Estate Higher Risk Investor Real Estate Segments
Slide 21: Non-Performing Loans Paying as Agreed
Percentage of Non-Performing Loans Paying as Agreed Business Services Gross Additions which remained at quarter end Total Business Services NPLs as of 09/30/10 Balances that are Current Balances 30+ DPD Balances that are Current Balances 30+ DPD Gross NPL Migration 0% 20% 40% 60% 80% 100% 1Q09 2Q09
Slide 22: Higher Loan Charge-Offs Reflect Asset Dispositions
$751 $768 $758 $687 Higher Loan Charge-Offs Reflect Asset Dispositions $0 $250 $500 $750 $1,000 3Q09 4Q09 1Q10 2Q10 3Q10
Slide 23: Non-Performing Assets and Delinquencies Declining
Non-Performing Assets and Delinquencies Declining Non-Performing Assets (excludes loans held for sale) Accruing Loans Past Due
Slide 24: Solid Capital
Solid Capital; Currently above proposed Basel minimum ratios * Estimated Basel Tier 1 Min Basel T1C Min
Slide 25: Strong Liquidity
Strong Liquidity Loan to Deposit Ratio 107% 92% 89% • As rules are currently interpreted, expect to exceed proposed Basel III Liquidity Coverage Ratio • High-quality securities portfolio comprised of over 95% agency securities
Slide 26: Impact from Regulatory Reform and Basel Proposal
Issue Impact to Regions Impact from Regulatory Reform and Basel Proposal Regulation E Impact from Reg E to be less than originally forecasted due to better than expected customer response to opting-in to program Original forecast for half of 2010: $72 million New forecast: $50 - million Durbin Amend
Slide 27: Solid and Tested Foreclosure Process
Committee of key managers approves the decision to proceed with foreclosure Same process for loans owned by Regions or an investor Mortgage foreclosure affidavits signed by a department manager in the presence of a notary Low foreclosure volumes 100 Regions-owned loans per month 160 investor-owned l
Slide 28: Why Regions?
Why Regions? Strong Southeastern franchise with comprehensive line of business offerings Solid core business performance Aggressively identifying and disposing of problem assets Capital and liquidity remain solid
Slide 29: Regions
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Slide 30: Regions
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Slide 31: Appendix
Appendix Note: The following table illustrates the method of calculating the Non-GAAP financial measures used in this slide presentation: ($ in millions) Sep YTD Total Non-Interest Expenses (GAAP) $ 4,660 $ 10,792 $ 4,751 $ 3,719 Adjustments: Goodwill impairment charge 6,000 Regulatory settlement ch