Financial Performance - Net income available to common shareholders was $534 million[3], with diluted earnings per share at $0.59[3] - Adjusted net income available to common shareholders reached $538 million[3], resulting in adjusted diluted earnings per share of $0.60[3] - Total revenue remained stable at $1,905 million[3] - Pre-Tax Pre-Provision Income was $832 million[3] - The efficiency ratio was 560%[3] - Return on Average Tangible Common Equity was 1934% on a reported basis and 1948% on an adjusted basis[3] Loan and Deposit Trends - Average loans remained stable, while ending loans grew by 1%[8] - Average deposits increased over 1%[22] - Pipelines are up 17% YoY and commitments are up 1%[8] Net Interest Income (NII) and Margin (NIM) - NII increased by 5% QoQ, and NIM increased 13bps to 365%[27] - Expect 2025 NII to grow between 3-5%[31] Non-Interest Income and Expense - Adjusted non-interest income increased 5%[36] to $646 million[33] - Non-interest expense increased 3%[40] to $1,073 million[38] - Expect FY25 adjusted non-interest income to grow between 25-35%[36]

Company Performance - Regions Financial reported quarterly earnings of $0.6 per share, exceeding the Zacks Consensus Estimate of $0.56 per share, and up from $0.52 per share a year ago, representing an earnings surprise of +7.14% [1] - The company posted revenues of $1.91 billion for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 2.80%, compared to year-ago revenues of $1.73 billion [2] - Over the last four quarters, Regions Financial has surpassed consensus EPS estimates four times and topped consensus revenue estimates two times [2] Stock Performance and Outlook - Regions Financial shares have increased by approximately 4.2% since the beginning of the year, while the S&P 500 has gained 7.1% [3] - The company's current consensus EPS estimate for the coming quarter is $0.57 on revenues of $1.88 billion, and for the current fiscal year, it is $2.26 on revenues of $7.42 billion [7] - The Zacks Rank for Regions Financial is currently 3 (Hold), indicating that the shares are expected to perform in line with the market in the near future [6] Industry Context - The Banks - Southeast industry, to which Regions Financial belongs, is currently in the top 19% of over 250 Zacks industries, suggesting a favorable outlook compared to the bottom 50% [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]

[Financial Highlights](index=3&type=section&id=Financial%20Highlights) Regions Financial Corporation reported Q2 2025 net income of $563 million, with total assets at $159.2 billion [Financial Highlights](index=3&type=section&id=Financial%20Highlights) In the second quarter of 2025, Regions Financial Corporation reported a net income of $563 million, or $0.59 per diluted share. This represents a significant increase from the $490 million, or $0.51 per diluted share, in the prior quarter. Total assets stood at $159.2 billion, a slight decrease from the previous quarter, while total deposits remained stable at $130.9 billion. Net interest income grew to $1.26 billion, up from $1.19 billion in the first quarter of 2025 Q2 2025 Earnings Summary ($ in millions, except per share data) | Metric | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | Net interest income | $1,259 | $1,194 | $1,186 | | Provision for credit losses | $126 | $124 | $102 | | Non-interest income | $646 | $590 | $545 | | Non-interest expense | $1,073 | $1,039 | $1,004 | | Net income | $563 | $490 | $501 | | Net income available to common shareholders | $534 | $465 | $477 | | Diluted earnings per common share | $0.59 | $0.51 | $0.52 | Q2 2025 Balance Sheet Summary ($ in millions) | Metric | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | Loans, net of unearned income | $96,723 | $95,733 | $97,508 | | Assets | $159,206 | $159,846 | $154,052 | | Deposits | $130,919 | $130,971 | $126,616 | | Shareholders' equity | $18,666 | $18,530 | $17,169 | [Selected Ratios and Other Information](index=4&type=section&id=Selected%20Ratios%20and%20Other%20Information) Key performance ratios for Q2 2025 showed improved profitability and efficiency, with ROA at 1.43% and efficiency ratio at 56.0% [Selected Ratios and Other Information](index=4&type=section&id=Selected%20Ratios%20and%20Other%20Information) Key performance ratios for Q2 2025 showed improvement in profitability and efficiency. The return on average assets (ROA) increased to 1.43% and the return on average common shareholders' equity rose to 12.72%. The efficiency ratio improved to 56.0%. The Common Equity Tier 1 (CET1) ratio was 10.7%, and the net interest margin (FTE) expanded to 3.65% Key Performance Ratios - Q2 2025 | Ratio | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | Return on average assets* | 1.43% | 1.27% | 1.32% | | Return on average common shareholders' equity* | 12.72% | 11.49% | 12.74% | | Efficiency ratio | 56.0% | 57.9% | 57.6% | | Common equity Tier 1 ratio (estimated) | 10.7% | 10.8% | 10.4% | | Net interest margin (FTE)* | 3.65% | 3.52% | 3.51% | | Net charge-offs as a % of average loans* | 0.47% | 0.52% | 0.42% | *Annualized - The tangible common book value per share increased to **$12.91** at the end of Q2 2025, up from **$12.29** in the prior quarter and **$10.61** in the prior year[6](index=6&type=chunk) - The allowance for credit losses to non-performing loans increased to **225%** from **205%** in the prior quarter, indicating stronger coverage[6](index=6&type=chunk) [Consolidated Balance Sheets](index=5&type=section&id=Consolidated%20Balance%20Sheets) As of June 30, 2025, total assets were $159.2 billion, with net loans at $95.1 billion and total deposits stable at $130.9 billion [Consolidated Balance Sheets](index=5&type=section&id=Consolidated%20Balance%20Sheets) As of June 30, 2025, total assets were $159.2 billion, a slight decrease from $159.8 billion in the previous quarter. Net loans increased to $95.1 billion. Total deposits remained stable at $130.9 billion. Total shareholders' equity increased to $18.7 billion, partly due to a reduction in accumulated other comprehensive loss Consolidated Balance Sheet Highlights ($ in millions) | Account | 6/30/2025 | 3/31/2025 | Change | | :--- | :--- | :--- | :--- | | **Assets** | | | | | Total assets | $159,206 | $159,846 | ($640) | | Net loans | $95,111 | $94,120 | $991 | | Debt securities (AFS & HTM) | $32,305 | $31,137 | $1,168 | | **Liabilities & Equity** | | | | | Total deposits | $130,919 | $130,971 | ($52) | | Total liabilities | $140,500 | $141,279 | ($779) | | Total shareholders' equity | $18,666 | $18,530 | $136 | - Accumulated other comprehensive loss improved, decreasing from a loss of **$2.28 billion** in Q1 2025 to a loss of **$1.97 billion** in Q2 2025[9](index=9&type=chunk) [Loans](index=6&type=section&id=Loans) Loan portfolio analysis reveals end-of-period loans increased to $96.7 billion, driven by business loan growth, while average balances remained stable [End of Period Loans](index=6&type=section&id=End%20of%20Period%20Loans) Total loans at the end of Q2 2025 were $96.7 billion, an increase of 1.0% from the previous quarter, primarily driven by growth in business loans. Total business loans grew by 1.5% QoQ to $63.8 billion, while consumer loans remained flat. Year-over-year, total loans decreased by 0.8% End of Period Loans by Category ($ in millions) | Loan Category | Q2 2025 | Q1 2025 | QoQ Change | YoY Change | | :--- | :--- | :--- | :--- | :--- | | Total business | $63,849 | $62,877 | 1.5% | (0.6)% | | Total consumer | $32,874 | $32,856 | 0.1% | (1.3)% | | **Total Loans** | **$96,723** | **$95,733** | **1.0%** | **(0.8)%** | - Within business loans, Commercial investor real estate mortgage loans saw the largest quarterly growth, increasing by **9.0%** to **$6.9 billion**[11](index=11&type=chunk) - The loan portfolio composition remained stable, with business loans constituting **66.0%** and consumer loans **34.0%** of total loans[12](index=12&type=chunk) [Average Balances of Loans](index=7&type=section&id=Average%20Balances%20of%20Loans) Average total loan balances in Q2 2025 were $96.1 billion, nearly flat compared to Q1 2025 and down 1.2% from Q2 2024. Average business loan balances saw a slight increase of 0.1% QoQ, while average consumer loan balances decreased by 0.4% QoQ Average Loan Balances ($ in millions) | Loan Category | 2Q25 | 1Q25 | QoQ Change | 2Q25 vs. 2Q24 | | :--- | :--- | :--- | :--- | :--- | | Total business | $63,212 | $63,140 | 0.1% | (1.2)% | | Total consumer | $32,865 | $32,982 | (0.4)% | (1.2)% | | **Total Loans** | **$96,077** | **$96,122** | **(0.05)%** | **(1.2)%** | [Deposits](index=8&type=section&id=Deposits) Total deposits remained stable at $130.9 billion, with average balances increasing to $129.4 billion, driven by money market growth [End of Period Deposits](index=8&type=section&id=End%20of%20Period%20Deposits) Total deposits at the end of Q2 2025 were $130.9 billion, remaining flat compared to the prior quarter but increasing by 3.4% year-over-year. There was a notable shift in deposit mix, with non-interest-bearing deposits decreasing by 0.6% QoQ, while money market deposits grew by 3.3% QoQ End of Period Deposits by Type ($ in millions) | Deposit Type | Q2 2025 | Q1 2025 | QoQ Change | YoY Change | | :--- | :--- | :--- | :--- | :--- | | Non-interest-bearing | $40,209 | $40,443 | (0.6)% | (1.8)% | | Interest-bearing | $90,710 | $90,528 | 0.2% | 5.9% | | **Total Deposits** | **$130,919** | **$130,971** | **(0.04)%** | **3.4%** | - By segment, Corporate Bank deposits grew **1.0%** QoQ to **$40.1 billion**, while Consumer Bank and Wealth Management deposits saw modest declines[16](index=16&type=chunk) [Average Balances of Deposits](index=9&type=section&id=Average%20Balances%20of%20Deposits) Average total deposits for Q2 2025 increased by 1.4% QoQ to $129.4 billion. The growth was driven by a 5.0% increase in average money market deposits and a 1.3% increase in average non-interest-bearing deposits. Year-over-year, average total deposits grew by 2.0% Average Deposit Balances ($ in millions) | Deposit Type | 2Q25 | 1Q25 | QoQ Change | 2Q25 vs. 2Q24 | | :--- | :--- | :--- | :--- | :--- | | Non-interest-bearing | $39,556 | $39,053 | 1.3% | (2.4)% | | Money market—domestic | $37,389 | $35,625 | 5.0% | 8.8% | | **Total Deposits** | **$129,444** | **$127,687** | **1.4%** | **2.0%** | [Consolidated Statements of Income](index=10&type=section&id=Consolidated%20Statements%20of%20Income) For Q2 2025, net income increased to $563 million, driven by higher net interest income and non-interest income [Consolidated Statements of Income](index=10&type=section&id=Consolidated%20Statements%20of%20Income) For Q2 2025, the company reported net income of $563 million, a 14.9% increase from Q1 2025. Net interest income rose to $1.26 billion, and non-interest income increased to $646 million. Non-interest expense also grew to $1.07 billion. For the six months ended June 30, 2025, net income was $1.05 billion, compared to $869 million for the same period in 2024 Q2 2025 Income Statement Summary ($ in millions) | Item | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | Total interest income | $1,784 | $1,725 | $1,762 | | Total interest expense | $525 | $531 | $576 | | **Net interest income** | **$1,259** | **$1,194** | **$1,186** | | Provision for credit losses | $126 | $124 | $102 | | Total non-interest income | $646 | $590 | $545 | | Total non-interest expense | $1,073 | $1,039 | $1,004 | | **Net income** | **$563** | **$490** | **$501** | Six Months Ended June 30 Income Statement Summary ($ in millions) | Item | 2025 | 2024 | | :--- | :--- | :--- | | Net interest income | $2,453 | $2,370 | | Total non-interest income | $1,236 | $1,108 | | Total non-interest expense | $2,112 | $2,135 | | **Net income** | **$1,053** | **$869** | [Consolidated Average Daily Balances and Yield / Rate Analysis](index=12&type=section&id=Consolidated%20Average%20Daily%20Balances%20and%20Yield%20%2F%20Rate%20Analysis) Q2 2025 saw net interest margin expand to 3.65%, driven by higher earning asset yields and lower interest-bearing liability rates [Consolidated Average Daily Balances and Yield / Rate Analysis](index=12&type=section&id=Consolidated%20Average%20Daily%20Balances%20and%20Yield%20%2F%20Rate%20Analysis) In Q2 2025, the net interest margin on a taxable-equivalent basis (FTE) expanded to 3.65%, up from 3.52% in Q1 2025. This was driven by a higher yield on total earning assets (5.12%) while the rate on total interest-bearing liabilities decreased to 2.20%. The total cost of deposits remained relatively stable at 1.39% Yield/Rate Analysis (FTE Basis) | Metric | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | Yield on Total Earning Assets | 5.12% | 5.01% | 5.17% | | Rate on Total Interest-Bearing Liabilities | 2.20% | 2.27% | 2.55% | | Net Interest Spread | 2.92% | 2.75% | 2.62% | | **Net Interest Margin** | **3.65%** | **3.52%** | **3.51%** | - The yield on total loans increased to **5.75%** in Q2 2025 from **5.64%** in Q1 2025[23](index=23&type=chunk) - The total cost of deposits for Q2 2025 was **1.39%**, a slight decrease from **1.40%** in the prior quarter[25](index=25&type=chunk) [Pre-Tax Pre-Provision Income (PPI) and Adjusted PPI](index=14&type=section&id=Pre-Tax%20Pre-Provision%20Income%20(PPI)%20and%20Adjusted%20PPI) Pre-tax pre-provision income (PPI) for Q2 2025 was $832 million, reflecting an 11.7% increase from the prior quarter [Pre-Tax Pre-Provision Income (PPI) and Adjusted PPI](index=14&type=section&id=Pre-Tax%20Pre-Provision%20Income%20(PPI)%20and%20Adjusted%20PPI) Pre-tax pre-provision income (PPI), a non-GAAP measure, was $832 million for Q2 2025, an 11.7% increase from the prior quarter. Adjusted PPI, which excludes certain items like securities losses and severance charges, was also $832 million, up 7.5% from Q1 2025. The report provides a reconciliation from GAAP income before taxes to these non-GAAP measures - The company uses non-GAAP measures like PPI to provide a basis for period-to-period comparisons that management believes assists investors in assessing performance[32](index=32&type=chunk) PPI Reconciliation ($ in millions) | Metric | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | Income before income taxes (GAAP) | $706 | $621 | $625 | | Provision for credit losses (GAAP) | $126 | $124 | $102 | | **Pre-tax pre-provision income (non-GAAP)** | **$832** | **$745** | **$727** | | Total other adjustments | $0 | $29 | $22 | | **Adjusted pre-tax pre-provision income (non-GAAP)** | **$832** | **$774** | **$749** | [Non-Interest Income](index=15&type=section&id=Non-Interest%20Income) Total non-interest income for Q2 2025 increased to $646 million, driven by growth in mortgage, card, and capital markets income [Non-Interest Income Overview](index=15&type=section&id=Non-Interest%20Income%20Overview) Total non-interest income for Q2 2025 was $646 million, a 9.5% increase from Q1 2025 and an 18.5% increase from Q2 2024. The growth was driven by higher mortgage income, card and ATM fees, and capital markets income, as well as a significant reduction in net securities losses compared to prior periods Non-Interest Income Components ($ in millions) | Category | Q2 2025 | Q1 2025 | QoQ Change | YoY Change | | :--- | :--- | :--- | :--- | :--- | | Service charges on deposit accounts | $151 | $161 | (6.2)% | 0.0% | | Card and ATM fees | $125 | $117 | 6.8% | 4.2% | | Wealth management income | $133 | $129 | 3.1% | 9.0% | | Capital markets income | $83 | $80 | 3.8% | 22.1% | | Mortgage income | $48 | $40 | 20.0% | 41.2% | | Securities gains (losses), net | ($1) | ($25) | 96.0% | 98.0% | | **Total non-interest income** | **$646** | **$590** | **9.5%** | **18.5%** | [Service Charges on Deposit Accounts by Segment](index=15&type=section&id=Service%20Charges%20on%20Deposit%20Accounts%20by%20Segment) Total service charges on deposit accounts were $151 million in Q2 2025, a decrease of 6.2% from the prior quarter. The decline was driven by both the Consumer Bank and Corporate Bank segments, which saw decreases of 6.3% each Service Charges by Segment ($ in millions) | Segment | Q2 2025 | Q1 2025 | QoQ Change | | :--- | :--- | :--- | :--- | | Consumer Bank Segment | $90 | $96 | (6.3)% | | Corporate Bank Segment | $60 | $64 | (6.3)% | | **Total** | **$151** | **$161** | **(6.2)%** | [Wealth Management Income](index=15&type=section&id=Wealth%20Management%20Income) Wealth management income rose to $133 million in Q2 2025, up 3.1% from Q1 2025 and 9.0% from Q2 2024. The growth was primarily due to a 4.7% quarterly increase in investment management and trust fee income Wealth Management Income Components ($ in millions) | Category | Q2 2025 | Q1 2025 | QoQ Change | | :--- | :--- | :--- | :--- | | Investment management and trust fee income | $90 | $86 | 4.7% | | Investment services fee income | $43 | $43 | 0.0% | | **Total** | **$133** | **$129** | **3.1%** | [Capital Markets Income](index=15&type=section&id=Capital%20Markets%20Income) Capital markets income was $83 million in Q2 2025, a 3.8% increase from the prior quarter and a 22.1% increase year-over-year. Excluding valuation adjustments on customer derivatives, income was $85 million Capital Markets Income ($ in millions) | Metric | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | Capital markets income | $83 | $80 | $68 | | Capital markets income excluding valuation adjustments | $85 | $81 | $70 | [Mortgage Income](index=15&type=section&id=Mortgage%20Income) Mortgage income increased significantly to $48 million in Q2 2025, up from $40 million in Q1 2025. The rise was driven by higher production and sales income and a positive swing in the MSR and related hedge impact. Total mortgage production volume surged by 54.0% QoQ to $1.1 billion Mortgage Income and Production ($ in millions) | Metric | Q2 2025 | Q1 2025 | QoQ Change | | :--- | :--- | :--- | :--- | | Production and sales | $17 | $13 | 30.8% | | MSR and related hedge impact | ($16) | ($20) | 20.0% | | **Total mortgage income** | **$48** | **$40** | **20.0%** | | **Total mortgage production** | **$1,118** | **$726** | **54.0%** | [Non-Interest Expense](index=17&type=section&id=Non-Interest%20Expense) Total non-interest expense for Q2 2025 increased to $1.07 billion, primarily due to a rise in salaries and employee benefits [Non-Interest Expense](index=17&type=section&id=Non-Interest%20Expense) Total non-interest expense for Q2 2025 was $1.07 billion, an increase of 3.3% from Q1 2025 and 6.9% from Q2 2024. The quarterly increase was primarily driven by a 5.3% rise in salaries and employee benefits. For the first six months of 2025, total non-interest expense decreased by 1.1% compared to the same period in 2024 Non-Interest Expense Components ($ in millions) | Category | Q2 2025 | Q1 2025 | QoQ Change | YoY Change | | :--- | :--- | :--- | :--- | :--- | | Salaries and employee benefits | $658 | $625 | 5.3% | 8.0% | | Equipment and software expense | $104 | $99 | 5.1% | 4.0% | | Professional, legal and regulatory expenses | $28 | $23 | 21.7% | 12.0% | | **Total non-interest expense** | **$1,073** | **$1,039** | **3.3%** | **6.9%** | - Salaries and benefits expense, when adjusted for market value changes on 401(k) liabilities, increased by a smaller **2.6%** quarter-over-quarter[53](index=53&type=chunk) [Reconciliation of GAAP Financial Measures to non-GAAP Financial Measures](index=18&type=section&id=Reconciliation%20of%20GAAP%20Financial%20Measures%20to%20non-GAAP%20Financial%20Measures) This section reconciles GAAP to non-GAAP financial measures, including adjusted efficiency, net income, tangible common, and CET1 ratios [Adjusted Ratios (Efficiency, Fee Income, Operating Leverage)](index=18&type=section&id=Adjusted%20Ratios%20(Efficiency%2C%20Fee%20Income%2C%20Operating%20Leverage)) This section provides reconciliations for key operating ratios by adjusting GAAP revenue and expense for certain items. For Q2 2025, the adjusted efficiency ratio was 56.0%, an improvement from 56.8% in Q1 2025. The adjusted fee income ratio was 33.7%, roughly in line with the prior quarter Adjusted Ratio Reconciliation - Q2 2025 | Metric | GAAP | Adjusted (non-GAAP) | | :--- | :--- | :--- | | Non-interest expense | $1,073M | $1,073M | | Total revenue, taxable-equivalent basis | $1,917M | $1,917M | | **Efficiency Ratio** | **56.0%** | **56.0%** | | Non-interest income | $646M | $646M | | **Fee Income Ratio** | **33.7%** | **33.7%** | - For Q2 2025, there were no adjustments to non-interest income or expense, so the GAAP and non-GAAP ratios were the same. In prior quarters, adjustments were made for items like securities losses and FDIC special assessments[57](index=57&type=chunk) [Adjusted Net Income, EPS, and Return Ratios](index=20&type=section&id=Adjusted%20Net%20Income%2C%20EPS%2C%20and%20Return%20Ratios) This section reconciles GAAP net income to adjusted non-GAAP figures. For Q2 2025, adjusted net income available to common shareholders was $538 million, or $0.60 per diluted share, compared to GAAP figures of $534 million and $0.59. The adjusted return on average tangible common shareholders' equity was 19.48% Adjusted Net Income and EPS - Q2 2025 | Metric | GAAP | Adjusted (non-GAAP) | | :--- | :--- | :--- | | Net income available to common shareholders | $534M | $538M | | Diluted EPS | $0.59 | $0.60 | | Return on avg. tangible common equity* | 19.34% | 19.48% | *Annualized - Adjustments for Q2 2025 included a **$4 million** non-taxable expense for the redemption of Series D preferred stock[62](index=62&type=chunk)[63](index=63&type=chunk) [Tangible Common Ratios](index=21&type=section&id=Tangible%20Common%20Ratios) The report calculates tangible common equity and related ratios to assess capital adequacy absent intangible assets. As of June 30, 2025, the tangible common book value per share increased to $12.91 from $12.29 in the prior quarter. The ratio of tangible common shareholders' equity to tangible assets improved to 7.52% from 7.17% Tangible Common Ratios | Metric | 6/30/2025 | 3/31/2025 | 6/30/2024 | | :--- | :--- | :--- | :--- | | Tangible common shareholders' equity (non-GAAP) | $11,541M | $11,047M | $9,709M | | Tangible common book value per share (non-GAAP) | $12.91 | $12.29 | $10.61 | | Tangible common equity to tangible assets (non-GAAP) | 7.52% | 7.17% | 6.55% | [Common Equity Tier 1 (CET1) Ratios](index=21&type=section&id=Common%20Equity%20Tier%201%20(CET1)%20Ratios) The estimated Common Equity Tier 1 (CET1) ratio was 10.7% at the end of Q2 2025, slightly down from 10.8% in Q1 2025 but above the 10.4% from the prior year. An adjusted CET1 ratio, which includes the impact of AOCI, was calculated at 9.2%, showing an improvement from 9.1% in the prior quarter CET1 Ratios (Estimated) | Ratio | 6/30/2025 | 3/31/2025 | 6/30/2024 | | :--- | :--- | :--- | :--- | | Common equity Tier 1 ratio | 10.7% | 10.8% | 10.4% | | Adjusted common equity Tier 1 ratio (non-GAAP) | 9.2% | 9.1% | 8.2% | - The company provides the adjusted CET1 ratio to show the potential impact under recent proposed rulemaking standards that would include AOCI in the calculation[66](index=66&type=chunk) [Asset Quality](index=22&type=section&id=Asset%20Quality) Asset quality improved in Q2 2025, with reduced net charge-offs and a decrease in non-performing loans and delinquencies [Allowance for Credit Losses and Net Charge-Offs](index=22&type=section&id=Allowance%20for%20Credit%20Losses%20and%20Net%20Charge-Offs) Asset quality metrics showed improvement in Q2 2025. The total allowance for credit losses (ACL) stood at $1.74 billion, or 1.80% of total loans. Total net charge-offs decreased to $113 million from $123 million in the prior quarter, resulting in an annualized net charge-off ratio of 0.47%, down from 0.52% Allowance for Credit Losses (ACL) Roll-Forward ($ in millions) | Item | Q2 2025 | | :--- | :--- | | Beginning ACL | $1,730 | | Total Net Charge-offs | ($113) | | Provision for credit losses | $126 | | **Ending ACL** | **$1,743** | Net Loan Charge-offs as a % of Average Loans (Annualized) | Category | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | Total commercial | 0.45% | 0.35% | 0.37% | | Total investor real estate | 0.07% | 1.02% | 0.00% | | Total consumer | 0.63% | 0.66% | 0.61% | | **Total** | **0.47%** | **0.52%** | **0.42%** | [Non-Performing Loans and Delinquencies](index=25&type=section&id=Non-Performing%20Loans%20and%20Delinquencies) Credit quality continued to improve as non-performing loans (NPLs) decreased to $776 million, or 0.80% of total loans, from 0.88% in the prior quarter. Total delinquencies (30-89 days past due) also declined to $312 million from $333 million in Q1 2025 Non-Performing Loans (NPLs) (excludes loans held for sale) | Metric | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | Total NPLs ($M) | $776 | $843 | $847 | | NPLs as % of Loans | 0.80% | 0.88% | 0.87% | - The largest portion of NPLs came from the Commercial and industrial category (**$391 million**) and Commercial investor real estate mortgage (**$283 million**)[74](index=74&type=chunk) Total Delinquencies (Accruing 30-89 Days Past Due) | Metric | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | Total Delinquent Loans ($M) | $312 | $333 | $300 | | Delinquencies as % of Loans | 0.32% | 0.35% | 0.31% | [Forward-Looking Statements](index=26&type=section&id=Forward-Looking%20Statements) This section provides a legal disclaimer on forward-looking statements, highlighting various risks and uncertainties that could impact actual results [Forward-Looking Statements](index=26&type=section&id=Forward-Looking%20Statements) This section contains a standard legal disclaimer regarding forward-looking statements. It cautions investors not to place undue reliance on such statements as they are subject to various risks and uncertainties that could cause actual results to differ materially. The company lists numerous risk factors, including economic conditions, interest rate changes, credit risk, competition, regulatory changes, and cybersecurity threats - The company cautions that statements about future operations, strategies, and financial results are not guarantees and are subject to risks beyond its control[78](index=78&type=chunk) - Key risk factors mentioned include: * Economic and market conditions, including interest rates, inflation, and unemployment * Changes in monetary and fiscal policies * Creditworthiness of customers and collectability of loans * Competition from traditional and non-traditional financial services companies * Cybersecurity risks, including data breaches and hacking * Changes in laws, regulations, and accounting policies[78](index=78&type=chunk)[82](index=82&type=chunk) - The company assumes no obligation to update forward-looking statements except as required by law[80](index=80&type=chunk)

Core Viewpoint - Regions Financial Corporation (RF) is expected to report year-over-year growth in earnings and revenues for the second quarter of 2025, with earnings estimated at 56 cents per share, reflecting a 7.7% increase from the previous year [1][3][10]. Financial Performance - The Zacks Consensus Estimate for second-quarter revenues is $1.85 billion, indicating a 7.1% increase from the prior year [3]. - The company has a strong earnings surprise history, surpassing estimates in the last four quarters with an average surprise of 6.71% [2]. Key Factors Influencing Performance - Net Interest Income (NII) is projected to grow approximately 3% from the first quarter of 2025, with a consensus estimate of $1.2 billion [5]. - Loan demand remained strong, particularly for commercial and industrial loans, despite a challenging macroeconomic environment [5]. - Average interest-earning assets are expected to see a marginal sequential increase, with a consensus estimate of $1.39 billion [6]. Non-Interest Income - Non-interest income is forecasted to rise 5.3% sequentially, driven by card fees and service charges [10]. - Capital markets revenues are expected to improve modestly, with a consensus estimate of $80.1 million, although still below the previous year's levels [8]. - Mortgage income is estimated at $39.6 million, reflecting a nearly 1% decline from the prior quarter [11]. Expenses and Asset Quality - Expenses are anticipated to be high due to increased salaries and technology investments, despite ongoing expense management efforts [13]. - The company is likely to have set aside a significant amount for potential bad loans, with non-performing assets estimated at $899.1 million, a 1.7% rise from the previous quarter [14]. Earnings Prediction - The model predicts an earnings beat for Regions Financial, supported by a positive Earnings ESP of +0.23% and a Zacks Rank of 2 (Buy) [15][16].

Core Viewpoint - Regions Financial (RF) has been upgraded to a Zacks Rank 2 (Buy), indicating a positive outlook based on rising earnings estimates, which are a significant factor influencing stock prices [1][3]. Earnings Estimates and Stock Price Movement - The Zacks rating system is effective for individual investors as it focuses on earnings estimate revisions, which are strongly correlated with near-term stock price movements [2][4]. - An increase in earnings estimates typically leads to buying pressure from institutional investors, resulting in stock price increases [4][5]. Recent Performance and Projections - For the fiscal year ending December 2025, Regions Financial is expected to earn $2.26 per share, unchanged from the previous year, but the Zacks Consensus Estimate has increased by 2.3% over the past three months [8]. Zacks Rank System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with Zacks Rank 1 stocks historically generating an average annual return of +25% since 1988 [7]. - Regions Financial's upgrade to Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, suggesting potential for market-beating returns in the near term [10].

Core Insights - The article emphasizes the importance of the Zacks Rank system and Style Scores in identifying strong stocks, particularly for value investors [1][2] Company Analysis - First BanCorp. (FBP) has a Zacks Rank of 2 (Buy) and an A for Value, with a current P/E ratio of 10.79, lower than the industry average of 11.42 [3] - FBP's Forward P/E has fluctuated between 8.83 and 12.46 over the past year, with a median of 10.60 [3] - FBP's P/CF ratio is 10.97, significantly lower than the industry's average of 17.07, indicating potential undervaluation [4] - Regions Financial (RF) also holds a Zacks Rank of 2 (Buy) and a Value Score of A, trading at a forward earnings multiple of 10.44, below the industry average of 11.42 [5] - RF's PEG ratio is 1.86, compared to the industry's average of 1.35, suggesting it may be undervalued [5] - Over the past year, RF's P/E ratio has ranged from 8.06 to 12.14, with a median of 10.44, while its PEG ratio has varied between 1.51 and 2.83 [6] - RF's P/B ratio stands at 1.32, lower than the industry's average of 1.93, further indicating potential undervaluation [6] - Both FBP and RF are highlighted as strong value stocks due to their attractive earnings outlook and valuation metrics [7]

Core Viewpoint - Analysts project that Regions Financial (RF) will report quarterly earnings of $0.56 per share, reflecting a year-over-year increase of 7.7% and revenues of $1.85 billion, up 7.1% from the same quarter last year [1]. Earnings Estimates - The consensus EPS estimate has been revised upward by 1.5% in the past 30 days, indicating a reassessment by covering analysts [2]. - Changes in earnings estimates are crucial for predicting investor reactions, with empirical studies showing a strong correlation between earnings estimate revisions and short-term stock performance [3]. Key Financial Metrics - Analysts expect the 'Net interest margin (FTE)' to reach 3.6%, up from 3.5% in the same quarter last year [5]. - The 'Efficiency Ratio' is projected at 56.9%, compared to 57.6% a year ago [5]. - The 'Common Equity Tier 1 ratio' is anticipated to be 10.7%, an increase from 10.4% year-over-year [5]. Asset and Income Projections - The 'Average Balance - Total earning assets' is expected to be $139.69 billion, up from $137.07 billion last year [6]. - 'Non-performing assets' are projected at $899.10 million, compared to $862.00 million a year ago [6]. - 'Total Non-Interest Income' is likely to reach $621.40 million, up from $545.00 million last year [8]. - 'Net Interest Income' is expected to be $1.20 billion, slightly up from $1.19 billion year-over-year [8]. Additional Financial Insights - The consensus estimate for 'Net interest income, taxable equivalent basis' stands at $1.24 billion, compared to $1.20 billion last year [9]. - 'Wealth management income' is estimated at $127.46 million, up from $122.00 million in the same quarter of the previous year [9]. - Regions Financial shares have returned +13.9% over the past month, outperforming the Zacks S&P 500 composite's +5% change [9].

Company Overview - Regions Financial (RF) is anticipated to report a year-over-year increase in earnings, with a projected quarterly earnings of $0.56 per share, reflecting a +7.7% change, and revenues expected to reach $1.85 billion, up 7% from the previous year [3][12]. Earnings Expectations - The upcoming earnings report is scheduled for July 18, and the stock may experience upward movement if the reported numbers exceed expectations, while a miss could lead to a decline [2][12]. - The consensus EPS estimate has been revised 1.28% higher in the last 30 days, indicating a positive reassessment by analysts [4]. Earnings Surprise Prediction - The Zacks Earnings ESP for Regions Financial is +0.83%, suggesting a likelihood of beating the consensus EPS estimate, although the stock currently holds a Zacks Rank of 3 [12]. - Historical performance shows that Regions Financial has beaten consensus EPS estimates in the last four quarters, with a notable surprise of +5.88% in the last reported quarter [13][14]. Industry Context - In the Southeast banking industry, Simmons First National (SFNC) is expected to report earnings of $0.40 per share, indicating a +21.2% year-over-year change, with revenues projected at $213.4 million, up 8.2% [18]. - Simmons First National has an Earnings ESP of -1.68% and a Zacks Rank of 3, making it challenging to predict a beat on the consensus EPS estimate [19].

Strategic Priorities - Regions is focused on credit risk management, interest rate risk management, capital and liquidity management, and operational & compliance risk management[4] - Regions strategically invests in top quartile organic loan & deposit growth, leveraging superior growth of the core footprint with 3.5% projected population growth[4] Capital Strength and Risk Management - Regions' 2024 CCAR capital degradation is 1.8%, lower than the peer median of 2.5%[8] - Regions proactively hedges interest rate risk, protecting Net Interest Margin (NIM) against falling interest rates[9] - Regions' Pro forma Post-Stress CET1 is 75.9% which is higher than peers[12] Profitability and Growth - Regions has consistently strong growth metrics, supporting a higher P/E multiple[15] - Regions' Peer Leading Return on Average Tangible Common Shareholders' Equity (ROATCE) has been ranked 1 for 4 straight years[16] - Regions' 5-Year Earnings Per Share (EPS) Compound Annual Growth Rate (CAGR) outperforms most peers[17] - Regions' 5 Year Tangible Book Value (TBV) growth plus dividends is 18.7%[31] Deposit Advantage and Market Presence - Regions has a strong brand presence and attractive footprint in the Southeast[32] - Regions' deposit-weighted population growth by MSA for 2024-2029 is projected at 3.5%, compared to the national average of 2.4%[34] - Regions has top 5 market share in approximately 70% of MSAs across its 15-state footprint[35] - Regions' FY24 total deposit cost is below the peer median, contributing to a ~60bps advantage in Net Interest Margin (NIM)[37] - Regions' deposit growth in priority markets since 2019 is $12.5 billion[45] Investments in Technology and Talent - Regions is investing in core modernization, loan and deposit systems, and enhanced digital experiences[48] - Regions is expanding talent in key areas, including middle market and small business relationship managers, treasury management bankers, and branch sales bankers[48]

Summary of Regions Financial (RF) Conference Call Company Overview - **Company**: Regions Financial Corporation (RF) - **Date of Conference**: June 10, 2025 - **Key Speakers**: John Turner (CEO), David Turner (CFO), Kate Donella (Head of Consumer Banking) Core Industry Insights - **Focus on Long-term Performance**: The company emphasizes sustainable long-term performance through soundness, profitability, and growth [6][7] - **Credit Risk Management**: Improved credit risk management practices have led to better outcomes, reflected in strong CCAR results [6][7] - **Market Position**: Regions Financial has a strong market presence, with top five market share in 70 markets, growing at 1.5 times the national average [9][12] Financial Performance - **Shareholder Returns**: The company has delivered over 10% CAGR in dividend growth, placing it at the top of its peer group [8] - **Earnings Growth**: Regions has shown consistent growth in earnings per share, ranking as a top quartile performer over five and ten years [7][8] - **Deposit Growth**: The company has achieved $12.5 billion in deposit growth over the last five years in priority markets, with a total deposit opportunity of $1.5 trillion [12] Strategic Initiatives - **Investment in Human Capital**: Plans to add 170 bankers over the next three years, reallocating 600 branch bankers to focus on high-opportunity markets [13][14] - **Technology Investments**: Continued investment in technology to enhance customer service and operational efficiency [14][45] - **Wealth Management Growth**: The wealth management segment has grown at an 8.3% CAGR over the last six years, with plans to hire more wealth bankers [49] Market Sentiment and Economic Outlook - **Customer Sentiment**: Customers are in a "wait and see" mode due to economic uncertainties, particularly regarding tariffs and immigration reform [15][17] - **Loan Demand**: There is currently low loan growth due to uncertainty, with customers preferring to manage liquidity before borrowing [74] Regulatory Environment - **Regulatory Changes**: Anticipation of a more favorable regulatory environment, with increased transparency and dialogue with regulators [55][56] - **M&A Activity**: The company is not interested in depository M&A but is open to non-bank acquisitions, particularly in mortgage servicing and wealth management [61][63] Financial Guidance - **Net Interest Income (NII)**: Guidance for NII growth of 1% to 4% year-on-year, with potential for improvement based on market conditions [70][72] - **Fee Income Growth**: Expected growth in fee income of 1% to 3%, with challenges in mortgage and capital markets segments [76] - **Expense Management**: Guidance for flat to 2% increase in expenses, aiming for positive operating leverage [79] Key Risks and Considerations - **Tariff Impact**: Uncertainty regarding tariffs may affect credit risk and loan demand, though current credit health appears stable [24][26] - **Economic Clarity**: Customers need more clarity on economic conditions to unlock loan demand [34] Conclusion Regions Financial is positioned for growth through strategic investments in human capital and technology, while navigating economic uncertainties and regulatory changes. The focus remains on enhancing shareholder returns and maintaining strong market presence in priority growth areas.