Financial Performance - Net interest income for Q1 2025 was $1,194 million, a decrease from $1,230 million in Q4 2024, reflecting a 2.9% decline[4] - Non-interest income increased to $590 million in Q1 2025, compared to $585 million in Q4 2024, marking a 0.9% growth[4] - Net income available to common shareholders was $465 million for Q1 2025, down from $508 million in Q4 2024, representing an 8.5% decrease[4] - The provision for credit losses was $124 million in Q1 2025, slightly up from $120 million in Q4 2024, indicating a 3.3% increase[4] - Return on average assets for Q1 2025 was 1.27%, down from 1.36% in Q4 2024[6] - The efficiency ratio for Q1 2025 was 57.9%, compared to 56.8% in Q4 2024, indicating a decline in operational efficiency[6] - Total assets increased to $159,846 million at the end of Q1 2025, up from $157,302 million at the end of Q4 2024, reflecting a 1.6% growth[4] - Total shareholders' equity increased to $18,530 million, up from $17,879 million at December 31, 2024, reflecting a growth of 3.6%[9] - Net income for Q1 2025 was $490 million, down from $534 million in Q4 2024, but up from $368 million in Q1 2024[19] - Basic earnings per share for Q1 2025 was $0.51, down from $0.56 in Q4 2024 but up from $0.37 in Q1 2024[19] Loan and Deposit Trends - Loans, net of unearned income, decreased to $95,733 million in Q1 2025 from $96,727 million in Q4 2024, a decline of 1.0%[4] - Total deposits rose to $130,971 million, an increase of $3,368 million or 2.6% from $127,603 million at December 31, 2024[9] - Total loans decreased to $95,733 million, down by $994 million or 1.0% from $96,727 million at December 31, 2024[10] - The allowance for loan losses remained stable at $1,613 million as of March 31, 2025, unchanged from December 31, 2024[9] - Total deposits increased to $127,687 million in Q1 2025, up 0.9% from $126,493 million in Q4 2024 and 0.4% from $127,126 million in Q1 2024[17] - Non-interest-bearing deposits increased by $1.305 billion (3.3%) from Q4 2024 to Q1 2025, but decreased by $1.381 billion (3.3%) from Q1 2024[16] Credit Quality and Losses - The provision for loan losses was $123 million for the quarter, a decrease from $125 million in the previous quarter[58] - Non-performing loans, excluding loans held for sale, decreased to $843 million, down from $928 million at December 31, 2024, indicating improved asset quality[61] - Total net charge-offs for the quarter were $123 million, compared to $119 million in the previous quarter, reflecting an increase in loan losses[58] - The net loan charge-offs as a percentage of average loans, annualized, was 0.52% for the quarter, compared to 0.49% in the previous quarter[58] - Total accruing 30-89 days past due loans amounted to $333 million, representing 0.35% as of March 31, 2025, a decrease from $367 million (0.38%) at December 31, 2024[62] Operational Efficiency - Total non-interest expense remained stable at $1,039 million in Q1 2025, compared to $1,038 million in Q4 2024[19] - The efficiency ratio (GAAP) for Q1 2025 was 57.9%, compared to 56.8% in Q4 2024 and 64.3% in Q1 2024[44] - Adjusted efficiency ratio (non-GAAP) improved to 56.8% in Q1 2025 from 55.4% in Q4 2024[44] - Salaries and employee benefits increased to $625 million in Q1 2025, up 1.3% from $617 million in Q4 2024, but down 5.0% from $658 million in Q1 2024[40] Strategic Initiatives and Risks - The company anticipates potential impacts from economic conditions, including interest rate fluctuations and property value declines, which may affect lending and financial results[64] - The company is focused on enhancing its digital banking services to meet customer needs and respond to technological trends[64] - The company faces risks related to competition from fintechs and traditional financial institutions, which may affect its market position[64] - Changes in laws and regulations, including those affecting bank products and services, may require the company to alter business practices and could negatively impact revenue[68] - The company must invest significant managerial resources to comply with stress testing and capital planning requirements[68]

Summary of Goldman Sachs Portfolio Hedging Toolkit (Mar-2025) Industry Overview - The report focuses on the US equity market and macroeconomic risks, particularly the potential slowdown in growth and its implications for investors [1][6][12]. Key Points and Arguments 1. **Increased Recession Odds**: Economists have raised the 12-month recession probability from 15% to 20%, attributing this to policy changes as a significant risk factor [1][6]. 2. **Downgraded GDP Growth Forecast**: The 2025 US GDP growth forecast has been reduced to 1.7%, which is below consensus expectations, primarily due to anticipated policy-induced economic weakness [1][6]. 3. **Volatility and Hedging Costs**: Although options prices have decreased recently (VIX down 8 points), implied volatility for both indices and single stocks remains high, complicating the search for affordable hedges [1][6][12]. 4. **Recommended Hedges**: - Attractive put buying opportunities identified in stocks such as KEY, CMA, RF, URI, and FITB to hedge against growth risks [12][21]. - ETFs with high sensitivity to US growth include Mid/Small cap, Regional Banks, Financial, and Industrial sectors, which also have relatively low options prices [12][13]. 5. **Put Buying Costs**: The average cost for 3-month puts is approximately 2.6%, which captures upcoming earnings releases and policy announcements [3][19]. Additional Important Insights 1. **Growth vs. Macro Assets**: Despite underperformance against the S&P 500 year-to-date, growth stocks (VUG) have outperformed their typical relationship with macro assets by 8% over the past two years, indicating potential for mean reversion [7][9]. 2. **Hedging Strategies**: The report emphasizes the importance of tactical hedging strategies to mitigate risks associated with market downturns, tech stock drawdowns, and interest rate fluctuations [5][27]. 3. **Performance of Hedging Strategies**: Historical analysis shows that hedging strategies, particularly put spread collars, have provided superior risk-adjusted returns compared to holding equities alone [41][45]. Conclusion - The report provides a comprehensive analysis of the current market conditions and suggests specific hedging strategies for investors concerned about potential economic slowdowns. The focus on tactical hedges and the identification of attractive put buying opportunities highlight the proactive approach needed in the current volatile environment [1][6][12].

Financial Overview - As of December 31, 2024, Regions Financial Corporation had total consolidated assets of approximately $157.3 billion, total consolidated deposits of approximately $127.6 billion, and total consolidated shareholders' equity of approximately $17.9 billion[63]. - Total assets increased to $157.3 billion in 2024 from $152.2 billion in 2023, reflecting a growth of approximately 3.3%[615]. - Total liabilities rose to $139.4 billion in 2024, up from $134.7 billion in 2023, indicating an increase of about 3.9%[615]. - Total deposits remained relatively stable at $127.6 billion in 2024 compared to $127.8 billion in 2023[615]. - Total shareholders' equity increased to $17.9 billion in 2024 from $17.4 billion in 2023, representing a growth of approximately 2.6%[615]. - The Company's loan and lease portfolio was $96.7 billion as of December 31, 2024, with an allowance for credit losses of $1.73 billion[606]. - The provision for credit losses for the year ended December 31, 2024, was $487 million[606]. - Net income for 2024 was $1,893 million, a decline of 8.7% compared to $2,074 million in 2023[620]. - Earnings per common share (diluted) for 2024 was $1.93, down from $2.11 in 2023[617]. - Cash dividends declared in 2024 amounted to $895 million, an increase from $822 million in 2023[623]. Operational Structure - Regions Financial Corporation is classified as a Financial Holding Company (FHC) headquartered in Birmingham, Alabama[63]. - The company operates in the South, Midwest, and Texas, with additional offices in New York, Washington D.C., Chicago, and Salt Lake City, providing a wide range of financial solutions including retail and mortgage banking services, commercial banking services, and wealth and investment services[63]. - Regions operates under three reportable segments: Corporate Bank, Consumer Bank, and Wealth Management[68]. - Regions Bank operates 1,253 branches and 2,011 ATMs primarily across the South, Midwest, and Texas[65]. - The distribution of branches includes 270 in Florida, 195 in Tennessee, and 185 in Alabama, among others[66]. Risk Management - The company emphasizes the importance of managing risks associated with credit and operational risks, including those related to third-party vendors and cybersecurity threats[45]. - Regions Financial Corporation's ability to comply with capital and liquidity requirements, including Basel III Rules, is crucial for maintaining its financial condition and market perceptions[53]. - The company faces potential impacts from changes in economic conditions, including property values, interest rates, and unemployment rates, which could adversely affect its lending and financial results[30]. - The impact of pandemics on the company's operations and financial results is a significant concern, as it could disrupt the global economy and impair borrowers' ability to repay loans[59]. - The company is subject to various risks related to geopolitical instability, fraud, and changes in laws and regulations that could negatively impact its operations and financial results[44]. Regulatory Compliance - Regions is subject to enhanced prudential standards and capital rules as a bank holding company with over $100 billion in total consolidated assets[83]. - The company's capital plan must be submitted to the Federal Reserve as part of the Comprehensive Capital Analysis and Review (CCAR) process[91]. - Regions' stress test results for 2024 indicate that the company exceeded all minimum capital levels, with a capital buffer requirement of 2.5%[89]. - The Federal Reserve's proposal to revise risk-based capital standards may impact Regions, with an effective date of July 1, 2025, for certain elements[93]. - The U.S. banking regulators proposed a rule requiring banking organizations with $100 billion or more in total assets to maintain a minimum outstanding eligible long-term debt amount of no less than the greatest of (i) 6% of risk-weighted assets, (ii) 2.5% of total leverage exposure, and (iii) 3.5% of average total consolidated assets[94]. - Regions Bank submitted its most recent resolution plan in November 2022, and is required to file its next full resolution plan by July 1, 2025, under the FDIC's new rule effective October 1, 2024[99]. - The FDIA prohibits Regions Bank from paying dividends that would deplete its capital base to an inadequate level, ensuring compliance with capital requirements[109]. - Under Alabama law, Regions Bank may not pay a dividend in excess of 90% of its net earnings unless its surplus is equal to at least 20% of capital[111]. - The federal banking agencies have broad authority to take supervisory actions against Regions Bank if it does not meet specified capital requirements[107]. Financial Performance - Total interest income for 2024 reached $7,108 million, an increase of 3.1% from $6,897 million in 2023[617]. - Net interest income after provision for credit losses decreased to $4,331 million in 2024, down 9.2% from $4,767 million in 2023[617]. - Non-interest income totaled $2,265 million in 2024, slightly up from $2,256 million in 2023[617]. - Total non-interest expense decreased to $4,242 million in 2024, down 3.9% from $4,416 million in 2023[617]. - Provision for credit losses was $487 million in 2024, a decrease from $553 million in 2023[617]. - Comprehensive income for 2024 was $1,777 million, compared to $2,605 million in 2023[620]. - The weighted-average number of shares outstanding (diluted) decreased to 918 million in 2024 from 938 million in 2023[617]. Employee and Corporate Culture - As of December 31, 2024, Regions and its subsidiaries employed 19,644 full-time equivalent employees, supporting various banking services primarily across the Southeast and Midwest[150]. - The company emphasizes a robust pay-for-performance philosophy, incentivizing a majority of associates with compensation linked to business goals[156]. - Regions offers a comprehensive benefits program, including a 401(k) plan with a dollar-for-dollar company match on employee contributions up to 5% of pay[157]. - The company is committed to investing in professional development, providing opportunities for technical, management, and leadership training[154]. - Regions has established a customized learning experience platform to measure and build skills within the organization[154]. Market Trends and Competition - The financial services industry is expected to see continued consolidation, leading to larger, better-capitalized companies capable of offering a wide array of products[148]. - The rise of fintechs has increased competition, necessitating greater investment in technological improvements to meet customer expectations[149].

Financial Data and Key Metrics Changes - Regions Financial Corporation reported strong full-year earnings of $1.8 billion, resulting in earnings per share of $1.93 and a return on average tangible common equity of 18% [5][6] - Net interest income grew 1% in the fourth quarter, with net interest margin increasing by 1 basis point to 3.55% [22][24] - Adjusted non-interest income declined 5% from the previous quarter but increased 9% for the full year [27][29] Business Line Data and Key Metrics Changes - Capital Markets, Wealth Management, and Treasury Management businesses generated record revenue in 2024 [5][6] - Average loans declined modestly on a sequential quarter and full-year basis, with expectations of approximately 1% average loan growth for 2025 [16][19] - Average consumer loans remained stable in the fourth quarter, with modest growth in credit cards offset by declines in other categories [19] Market Data and Key Metrics Changes - Regions operates in core markets with population growth expected to exceed the national average by more than three times [8][9] - The company has grown deposits by $12.5 billion since 2019, outpacing the market [9] Company Strategy and Development Direction - The company plans to invest in talent, technology, and markets over the next several years to drive growth and generate efficiencies [10][11] - Regions aims to add approximately 140 bankers across various segments, focusing on priority growth markets [11][12] - The company is committed to judicious expense management while investing in growth opportunities [11][29] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about future growth, particularly in C&I lending, while acknowledging challenges in commercial real estate origination [19][120] - The company expects net charge-offs to be elevated in the first half of the year but believes they are adequately reserved for [90][91] - Management anticipates a notable pickup in lending activity in the second half of the year as economic clarity improves [17][19] Other Important Information - The company ended the quarter with an estimated common equity Tier 1 ratio of 10.8% and executed $58 million in share repurchases [34] - Adjusted non-interest expense declined 4% compared to the prior quarter, with a full-year decrease of 4% on a reported basis [29] Q&A Session Summary Question: Outlook on expenses and efficiencies - Management highlighted that 60% of expenses are salaries and benefits, and they are focused on managing headcount and vendor costs to create capacity for investments [41][43] Question: Capital management and growth - Management aims to use capital for business growth, particularly in loans, while targeting a dividend payout ratio of 40% to 50% of earnings [47][49] Question: Deposit pricing evolution - Management emphasized the importance of competitive deposit pricing and plans to lower deposit costs while growing deposits [58][60] Question: Loan growth expectations - Management indicated that loan growth is expected to be modest at around 1%, with different dynamics across loan types [19][70] Question: Fee income investments - Management is focused on identifying products and services that customers need and values, with plans to invest in mortgage servicing rights and other areas [110][111] Question: Acquisitions performance - Management expressed satisfaction with the performance of recent acquisitions, noting that while growth has been slower than expected, integration into existing operations has been positive [125][127]

Financial Performance - Net income available to common shareholders was $508 million for 4Q24 and $1774 million for FY24[3] - Total revenue reached $1815 million in 4Q24 and $7083 million for the full year 2024, with adjusted revenues of $1845 million and $7291 million respectively[3] - Non-interest expense was $1038 million for 4Q24 and $4242 million for FY24, with adjusted figures of $1029 million and $4227 million respectively[3] - Pre-tax pre-provision income was $777 million in 4Q24 and $2841 million in FY24, with adjusted figures of $816 million and $3064 million respectively[3] - The efficiency ratio was 568% for 4Q24 and 595% for FY24, with adjusted ratios of 554% and 576% respectively[3] - Net charge-offs as a percentage of average loans were 049% for both 4Q24 and FY24[3] Loan and Deposit Trends - Average loans and leases stood at $964 billion in 4Q24, slightly down from $970 billion in 3Q24[19] - Ending loans and leases were $967 billion in 4Q24, a slight decrease from $968 billion in 3Q24[21] - Average deposits increased to $1276 billion in 4Q24 from $1264 billion in 3Q24[26] - Ending deposits increased to $1265 billion in 4Q24 from $1260 billion in 3Q24[26] Net Interest Income (NII) and Margin - Net interest income (NII) was $1243 million in 4Q24, compared to $1230 million in 3Q24[30] - Net interest margin (NIM) increased by 1 basis point to 355% in 4Q24[30] - The company sold approximately $700 million of securities at a $30 million pre-tax loss and reinvested the proceeds at higher market yields[36] 2025 Expectations - Net interest income is expected to increase by 2-5% in 2025[38] - Adjusted non-interest income is projected to grow by 2-4% in FY25[44] - Adjusted non-interest expense is expected to increase by 1-3% in FY25, inclusive of investments[48] - Average loan balances are expected to increase by approximately 1% in 2025[23]

[Financial Highlights](index=3&type=section&id=Financial%20Highlights) [Earnings Summary](index=3&type=section&id=Earnings%20Summary) Regions Financial Corporation reported increased net income and diluted EPS in Q4 2024 compared to prior periods Quarterly Earnings Summary (Q4 2024 vs. Q3 2024 vs. Q4 2023) | Metric | 12/31/2024 | 9/30/2024 | 12/31/2023 | | :--------------------------------- | :--------- | :-------- | :--------- | | Net income ($ millions) | $534 | $490 | $391 | | Net income available to common shareholders ($ millions) | $508 | $446 | $367 | | Diluted EPS | $0.56 | $0.49 | $0.39 | - Net interest income remained relatively stable at **$1,230 million** in Q4 2024, compared to **$1,218 million** in Q3 2024 and **$1,231 million** in Q4 2023[4](index=4&type=chunk) - Provision for credit losses increased slightly to **$120 million** in Q4 2024 from **$113 million** in Q3 2024, but decreased from **$155 million** in Q4 2023[4](index=4&type=chunk) [Balance Sheet Summary](index=3&type=section&id=Balance%20Sheet%20Summary) Total assets remained stable in Q4 2024, with a slight QoQ decrease and YoY increase, while deposits grew modestly Quarterly Balance Sheet Summary (Q4 2024 vs. Q3 2024 vs. Q4 2023) | Metric | 12/31/2024 | 9/30/2024 | 12/31/2023 | | :--------------------------------- | :--------- | :-------- | :--------- | | Loans, net of unearned income ($ millions) | $96,727 | $96,789 | $98,379 | | Assets ($ millions) | $157,302 | $157,426 | $152,194 | | Deposits ($ millions) | $127,603 | $126,376 | $127,788 | | Shareholders' equity ($ millions) | $17,879 | $18,676 | $17,429 | - Loans, net of unearned income, remained relatively stable quarter-over-quarter at **$96,727 million**, but decreased by **1.7%** year-over-year from **$98,379 million**[4](index=4&type=chunk) - Deposits increased by **1.0%** from **$126,376 million** in Q3 2024 to **$127,603 million** in Q4 2024, but were slightly down from **$127,788 million** in Q4 2023[4](index=4&type=chunk) [Selected Ratios and Other Information](index=4&type=section&id=Selected%20Ratios%20and%20Other%20Information) [Key Performance Ratios (Quarterly)](index=4&type=section&id=Key%20Performance%20Ratios%20(Quarterly)) Profitability and efficiency ratios improved in Q4 2024, with return on average assets at **1.36%** and strong CET1 Selected Quarterly Ratios (Q4 2024 vs. Q3 2024 vs. Q4 2023) | Metric | 12/31/2024 | 9/30/2024 | 12/31/2023 | | :------------------------------------------------ | :--------- | :-------- | :--------- | | Return on average assets* (%) | 1.36 % | 1.26 % | 1.02 % | | Return on average common shareholders' equity* (%) | 12.39 % | 10.88 % | 9.95 % | | Efficiency ratio (%) | 56.8 % | 59.3 % | 65.0 % | | Common equity Tier 1 ratio (estimated) (%) | 10.8 % | 10.6 % | 10.3 % | | Net interest margin (FTE)* (%) | 3.55 % | 3.54 % | 3.60 % | | Net charge-offs as a percentage of average loans* (%) | 0.49 % | 0.48 % | 0.54 % | - The allowance for credit losses as a percentage of loans, net of unearned income, remained stable at **1.79%** in Q4 2024, consistent with Q3 2024[5](index=5&type=chunk) - Non-performing loans, excluding loans held for sale, increased to **0.96%** of loans in Q4 2024 from **0.85%** in Q3 2024[5](index=5&type=chunk) [Key Performance Ratios (Annual)](index=4&type=section&id=Key%20Performance%20Ratios%20(Annual)) Annual performance for 2024 showed a return on average assets of **1.23%** and a net interest margin of **3.54%** Selected Annual Ratios (2024 vs. 2023) | Metric | 2024 | 2023 | | :------------------------------------------------ | :----- | :----- | | Return on average assets (%) | 1.23 % | 1.36 % | | Return on average common shareholders' equity (%) | 11.24 %| 13.29 %| | Efficiency ratio (%) | 59.5 % | 57.9 % | | Net interest margin (FTE) (%) | 3.54 % | 3.90 % | | Net charge-offs as a percentage of average loans (%) | 0.47 % | 0.40 % | - The dividend payout ratio for 2024 increased to **50.5%** from **41.6%** in 2023[5](index=5&type=chunk) [Consolidated Balance Sheets](index=5&type=section&id=Consolidated%20Balance%20Sheets) [Assets, Liabilities and Equity](index=5&type=section&id=Assets%2C%20Liabilities%20and%20Equity) Total assets remained stable in Q4 2024, with increased deposits and a significant rise in long-term borrowings Consolidated Balance Sheet Highlights (Q4 2024 vs. Q3 2024 vs. Q4 2023) | Metric | 12/31/2024 | 9/30/2024 | 12/31/2023 | | :--------------------------------- | :--------- | :-------- | :--------- | | Total assets ($ millions) | $157,302 | $157,426 | $152,194 | | Net loans ($ millions) | $95,114 | $95,182 | $96,803 | | Total deposits ($ millions) | $127,603 | $126,376 | $127,788 | | Long-term borrowings ($ millions) | $5,993 | $6,016 | $2,330 | | Total shareholders' equity ($ millions) | $17,879 | $18,676 | $17,429 | - Debt securities held to maturity significantly increased to **$4,427 million** in Q4 2024 from **$2,787 million** in Q3 2024 and **$754 million** in Q4 2023[7](index=7&type=chunk) - Non-interest-bearing deposits decreased by **1.4%** QoQ and **7.6%** YoY, while interest-bearing deposits increased by **2.0%** QoQ and **3.6%** YoY[7](index=7&type=chunk) [Loans](index=6&type=section&id=Loans) [End of Period Loans](index=6&type=section&id=End%20of%20Period%20Loans) Total loan portfolio remained stable at **$96,727 million** in Q4 2024, with slight QoQ and YoY decreases End of Period Loans by Category ($ millions) | Loan Category | 12/31/2024 | 9/30/2024 | 12/31/2023 | 4Q24 vs. 3Q24 (%) | 4Q24 vs. 4Q23 (%) | | :------------------------------------ | :--------- | :-------- | :--------- | :---------------- | :---------------- | | Commercial and industrial ($ millions) | $49,671 | $49,565 | $50,865 | 0.2 | (2.3) | | Total business ($ millions) | $63,555 | $63,591 | $64,883 | (0.1) | (2.0) | | Residential first mortgage ($ millions) | $20,094 | $20,125 | $20,207 | (0.2) | (0.6) | | Consumer credit card ($ millions) | $1,445 | $1,372 | $1,341 | 5.3 | 7.8 | | Total consumer ($ millions) | $33,172 | $33,198 | $33,496 | (0.1) | (1.0) | | **Total Loans ($ millions)** | **$96,727**| **$96,789**| **$98,379**| **(0.1)** | **(1.7)** | End of Period Loans by Percentage | Loan Category | 12/31/2024 (%) | 9/30/2024 (%) | 12/31/2023 (%) | | :------------------------------------ | :--------- | :-------- | :--------- | | Commercial and industrial | 51.4 % | 51.2 % | 51.7 % | | Total business | 65.7 % | 65.7 % | 66.0 % | | Total consumer | 34.3 % | 34.3 % | 34.0 % | - Consumer credit card loans showed strong growth, increasing by **5.3%** QoQ and **7.8%** YoY[9](index=9&type=chunk) [Average Balances of Loans](index=7&type=section&id=Average%20Balances%20of%20Loans) Average total loans decreased to **$96,408 million** in Q4 2024, with commercial and industrial loans declining Average Balances of Loans by Category ($ millions) | Loan Category | 4Q24 ($ millions) | 3Q24 ($ millions) | 4Q23 ($ millions) | 4Q24 vs. 3Q24 (%) | 4Q24 vs. 4Q23 (%) | | :------------------------------------ | :--- | :--- | :--- | :---------------- | :---------------- | | Commercial and industrial | $49,357 | $49,847 | $50,939 | (1.0) | (3.1) | | Total business | $63,225 | $63,818 | $64,847 | (0.9) | (2.5) | | Total consumer | $33,183 | $33,222 | $33,446 | (0.1) | (0.8) | | **Total Loans** | **$96,408**| **$97,040**| **$98,293**| **(0.7)** | **(1.9)** | Annual Average Balances of Loans by Category ($ millions) | Loan Category | 2024 ($ millions) | 2023 ($ millions) | 2024 vs. 2023 (%) | | :------------------------------------ | :--- | :--- | :---------------- | | Commercial and industrial | $49,834 | $51,465 | (3.2) | | Total business | $63,773 | $65,218 | (2.2) | | Total consumer | $33,263 | $33,021 | 0.7 | | **Total Loans** | **$97,036**| **$98,239**| **(1.2)** | - For the full year 2024, average total loans decreased by **1.2%** compared to 2023, primarily driven by a **3.2%** decline in commercial and industrial loans[13](index=13&type=chunk) [Deposits](index=8&type=section&id=Deposits) [End of Period Deposits](index=8&type=section&id=End%20of%20Period%20Deposits) Total deposits increased by **1.0%** QoQ to **$127,603 million** in Q4 2024, with interest-free deposits declining End of Period Deposits by Type ($ millions) | Deposit Type | 12/31/2024 | 9/30/2024 | 12/31/2023 | 4Q24 vs. 3Q24 (%) | 4Q24 vs. 4Q23 (%) | | :-------------------------- | :--------- | :-------- | :--------- | :---------------- | :---------------- | | Interest-free deposits ($ millions) | $39,138 | $39,698 | $42,368 | (1.4) | (7.6) | | Interest-bearing checking ($ millions) | $25,079 | $23,704 | $24,480 | 5.8 | 2.4 | | Money market—domestic ($ millions) | $35,644 | $35,205 | $33,364 | 1.2 | 6.8 | | Time deposits ($ millions) | $15,720 | $15,684 | $14,972 | 0.2 | 5.0 | | **Total Deposits ($ millions)** | **$127,603**| **$126,376**| **$127,788**| **1.0** | **(0.1)** | End of Period Deposits by Segment ($ millions) | Segment | 12/31/2024 | 9/30/2024 | 12/31/2023 | 4Q24 vs. 3Q24 (%) | 4Q24 vs. 4Q23 (%) | | :-------------------- | :--------- | :-------- | :--------- | :---------------- | :---------------- | | Consumer Bank Segment ($ millions) | $78,637 | $78,858 | $80,031 | (0.3) | (1.7) | | Corporate Bank Segment ($ millions)| $38,361 | $36,955 | $36,883 | 3.8 | 4.0 | | Wealth Management Segment ($ millions) | $7,736 | $7,520 | $7,694 | 2.9 | 0.5 | - Corporate Bank Segment deposits increased by **3.8%** QoQ and **4.0%** YoY, indicating strong growth in this area[15](index=15&type=chunk) [Average Balances of Deposits](index=9&type=section&id=Average%20Balances%20of%20Deposits) Average total deposits increased by **0.4%** QoQ to **$126,493 million** in Q4 2024, with time deposits growing Average Balances of Deposits by Type ($ millions) | Deposit Type | 4Q24 ($ millions) | 3Q24 ($ millions) | 4Q23 ($ millions) | 4Q24 vs. 3Q24 (%) | 4Q24 vs. 4Q23 (%) | | :-------------------------- | :--- | :--- | :--- | :---------------- | :---------------- | | Interest-free deposits | $39,424 | $39,690 | $43,167 | (0.7) | (8.7) | | Interest-bearing checking | $24,060 | $23,599 | $23,128 | 2.0 | 4.0 | | Money market—domestic | $35,264 | $35,051 | $33,216 | 0.6 | 6.2 | | Time deposits | $15,725 | $15,427 | $14,045 | 1.9 | 12.0 | | **Total Deposits** | **$126,493**| **$125,950**| **$126,414**| **0.4** | **0.1** | Annual Average Balances of Deposits by Type ($ millions) | Deposit Type | 2024 ($ millions) | 2023 ($ millions) | 2024 vs. 2023 (%) | | :-------------------------- | :--- | :--- | :---------------- | | Interest-free deposits | $40,136 | $46,150 | (13.0) | | Time deposits | $15,471 | $10,545 | 46.7 | | **Total Deposits** | **$126,615**| **$126,543**| **0.1** | - For the full year 2024, average time deposits surged by **46.7%** compared to 2023, reflecting a shift towards higher-yielding deposit products[17](index=17&type=chunk) [Consolidated Statements of Income](index=10&type=section&id=Consolidated%20Statements%20of%20Income) [Quarterly Statements of Income](index=10&type=section&id=Quarterly%20Statements%20of%20Income) Net income increased to **$534 million** in Q4 2024, driven by lower interest and non-interest expenses Quarterly Income Statement Highlights ($ millions) | Metric | 12/31/2024 | 9/30/2024 | 12/31/2023 | | :--------------------------------- | :--------- | :-------- | :--------- | | Total interest income ($ millions) | $1,802 | $1,820 | $1,751 | | Total interest expense ($ millions) | $572 | $602 | $520 | | Net interest income ($ millions) | $1,230 | $1,218 | $1,231 | | Provision for credit losses ($ millions) | $120 | $113 | $155 | | Total non-interest income ($ millions) | $585 | $572 | $580 | | Total non-interest expense ($ millions) | $1,038 | $1,069 | $1,185 | | Net income ($ millions) | $534 | $490 | $391 | | Diluted EPS | $0.56 | $0.49 | $0.39 | - Interest expense on deposits decreased to **$467 million** in Q4 2024 from **$507 million** in Q3 2024, contributing to the net interest income stability[18](index=18&type=chunk) - Non-interest expense decreased by **2.9%** QoQ and **12.4%** YoY, primarily due to lower salaries and employee benefits and other miscellaneous expenses[18](index=18&type=chunk) [Annual Statements of Income](index=11&type=section&id=Annual%20Statements%20of%20Income) Annual net income for 2024 decreased to **$1,893 million**, primarily due to a decline in net interest income Annual Income Statement Highlights ($ millions) | Metric | 2024 | 2023 | | :--------------------------------- | :--- | :--- | | Total interest income ($ millions) | $7,108 | $6,897 | | Total interest expense ($ millions) | $2,290 | $1,577 | | Net interest income ($ millions) | $4,818 | $5,320 | | Provision for credit losses ($ millions) | $487 | $553 | | Total non-interest income ($ millions) | $2,265 | $2,256 | | Total non-interest expense ($ millions) | $4,242 | $4,416 | | Net income ($ millions) | $1,893 | $2,074 | | Diluted EPS | $1.93 | $2.11 | - Net interest income decreased by **9.4%** year-over-year, primarily due to a significant increase in interest expense on deposits (up **57.1%**)[21](index=21&type=chunk) - Total non-interest expense decreased by **3.9%** year-over-year, driven by lower operational losses and FDIC insurance assessments[21](index=21&type=chunk) [Consolidated Average Daily Balances and Yield/Rate Analysis](index=12&type=section&id=Consolidated%20Average%20Daily%20Balances%20and%20Yield%2FRate%20Analysis) [Quarterly Yield/Rate Analysis](index=12&type=section&id=Quarterly%20Yield%2FRate%20Analysis) Net interest margin (FTE) slightly increased to **3.55%** in Q4 2024, with an improved net interest spread Quarterly Yield/Rate Analysis Highlights (Q4 2024 vs. Q3 2024) | Metric | 12/31/2024 (%) | 9/30/2024 (%) | | :------------------------------------ | :--------- | :-------- | | Yield on Total earning assets | 5.17 % | 5.26 % | | Rate on Total interest-bearing liabilities | 2.41 % | 2.59 % | | Net interest spread | 2.76 % | 2.67 % | | Net interest income/margin FTE basis | 3.55 % | 3.54 % | - The yield on loans, net of unearned income, decreased to **5.87%** in Q4 2024 from **6.02%** in Q3 2024[23](index=23&type=chunk) - The rate for total deposit costs decreased to **1.47%** in Q4 2024 from **1.60%** in Q3 2024[25](index=25&type=chunk) [Annual Yield/Rate Analysis](index=14&type=section&id=Annual%20Yield%2FRate%20Analysis) Annual net interest margin (FTE) for 2024 was **3.54%**, a decrease from 2023 due to higher liability rates Annual Yield/Rate Analysis Highlights (2024 vs. 2023) | Metric | 2024 (%) | 2023 (%) | | :------------------------------------ | :--- | :--- | | Yield on Total earning assets | 5.18 % | 5.02 % | | Rate on Total interest-bearing liabilities | 2.50 % | 1.84 % | | Net interest spread | 2.68 % | 3.18 % | | Net interest income/margin FTE basis | 3.54 % | 3.90 % | - The rate for total deposit costs increased significantly to **1.56%** in 2024 from **0.99%** in 2023[33](index=33&type=chunk) - The yield on total loans, net of unearned income, increased to **5.93%** in 2024 from **5.86%** in 2023[30](index=30&type=chunk) [Pre-Tax Pre-Provision Income ("PPI") and Adjusted PPI (non-GAAP)](index=15&type=section&id=Pre-Tax%20Pre-Provision%20Income%20(%22PPI%22)%20and%20Adjusted%20PPI%20(non-GAAP)) [Quarterly PPI and Adjusted PPI](index=15&type=section&id=Quarterly%20PPI%20and%20Adjusted%20PPI) Pre-tax pre-provision income (non-GAAP) increased to **$777 million** in Q4 2024, showing strong QoQ and YoY growth Quarterly PPI and Adjusted PPI ($ millions) | Metric | 12/31/2024 | 9/30/2024 | 12/31/2023 | 4Q24 vs. 3Q24 (%) | 4Q24 vs. 4Q23 (%) | | :------------------------------------ | :--------- | :-------- | :--------- | :---------------- | :---------------- | | Pre-tax pre-provision income (non-GAAP) ($ millions) | $777 | $721 | $626 | 7.8 | 24.1 | | Adjusted pre-tax pre-provision income (non-GAAP) ($ millions) | $816 | $799 | $774 | 2.1 | 5.4 | - Key adjustments to PPI included a **$30 million** securities loss (net) in Q4 2024, a significant improvement from a **$78 million** loss in Q3 2024[35](index=35&type=chunk) - The FDIC insurance special assessment reflected a reduction to the accrual in Q4 2024 and Q3 2024, contrasting with a large expense in Q4 2023[35](index=35&type=chunk)[36](index=36&type=chunk) [Annual PPI and Adjusted PPI](index=15&type=section&id=Annual%20PPI%20and%20Adjusted%20PPI) Annual pre-tax pre-provision income (non-GAAP) decreased by **10.1%** to **$2,841 million** in 2024 Annual PPI and Adjusted PPI ($ millions) | Metric | 2024 | 2023 | 2024 vs. 2023 (%) | | :------------------------------------ | :--- | :--- | :---------------- | | Pre-tax pre-provision income (non-GAAP) ($ millions) | $2,841 | $3,160 | (10.1) | | Adjusted pre-tax pre-provision income (non-GAAP) ($ millions) | $3,064 | $3,317 | (7.6) | - The annual decline was largely influenced by a **$208 million** securities loss (net) in 2024, compared to a **$5 million** loss in 2023[35](index=35&type=chunk) - FDIC insurance special assessment adjustments significantly impacted the year-over-year comparison, with a **$103 million** reduction in 2024 compared to 2023[35](index=35&type=chunk) [Non-Interest Income, Mortgage Income, Wealth Management Income and Capital Markets Income](index=16&type=section&id=Non-Interest%20Income%2C%20Mortgage%20Income%2C%20Wealth%20Management%20Income%20and%20Capital%20Markets%20Income) [Quarterly Non-Interest Income Breakdown](index=16&type=section&id=Quarterly%20Non-Interest%20Income%20Breakdown) Total non-interest income increased by **2.3%** QoQ to **$585 million** in Q4 2024, driven by capital markets and MSR impact Quarterly Non-Interest Income ($ millions) | Income Category | 12/31/2024 | 9/30/2024 | 12/31/2023 | 4Q24 vs. 3Q24 (%) | 4Q24 vs. 4Q23 (%) | | :------------------------------------ | :--------- | :-------- | :--------- | :---------------- | :---------------- | | Service charges on deposit accounts ($ millions) | $155 | $158 | $143 | (1.9) | 8.4 | | Card and ATM fees ($ millions) | $113 | $118 | $127 | (4.2) | (11.0) | | Wealth management income ($ millions) | $126 | $128 | $117 | (1.6) | 7.7 | | Capital markets income ($ millions) | $97 | $92 | $48 | 5.4 | 102.1 | | Mortgage income ($ millions) | $35 | $36 | $31 | (2.8) | 12.9 | | Securities gains (losses), net ($ millions) | $(30) | $(78) | $(2) | 61.5 | NM | | **Total non-interest income ($ millions)** | **$585** | **$572** | **$580** | **2.3** | **0.9** | - Capital markets income surged by **102.1%** year-over-year, reaching **$97 million** in Q4 2024[37](index=37&type=chunk) - Mortgage income increased by **12.9%** YoY, primarily due to a significant fair value increase in MSRs (Mortgage Servicing Rights) offsetting hedge losses[37](index=37&type=chunk)[38](index=38&type=chunk) [Annual Non-Interest Income Breakdown](index=17&type=section&id=Annual%20Non-Interest%20Income%20Breakdown) Total non-interest income remained flat at **$2,265 million** in 2024, with capital markets and mortgage income growth offset by securities losses Annual Non-Interest Income ($ millions) | Income Category | 2024 | 2023 | 2024 vs. 2023 (%) | | :------------------------------------ | :--- | :--- | :---------------- | | Service charges on deposit accounts ($ millions) | $612 | $592 | 3.4 | | Card and ATM fees ($ millions) | $467 | $504 | (7.3) | | Wealth management income ($ millions) | $495 | $451 | 9.8 | | Capital markets income ($ millions) | $348 | $222 | 56.8 | | Mortgage income ($ millions) | $146 | $109 | 33.9 | | Securities gains (losses), net ($ millions) | $(208)| $(5) | NM | | **Total non-interest income ($ millions)** | **$2,265**| **$2,256**| **0.4** | - Capital markets income increased by **56.8%** year-over-year, contributing significantly to non-interest income[44](index=44&type=chunk) - Mortgage income grew by **33.9%** year-over-year, driven by increases in production and sales, and loan servicing income[44](index=44&type=chunk)[45](index=45&type=chunk) [Non-Interest Expense](index=18&type=section&id=Non-Interest%20Expense) [Quarterly Non-Interest Expense Breakdown](index=18&type=section&id=Quarterly%20Non-Interest%20Expense%20Breakdown) Total non-interest expense decreased by **2.9%** QoQ to **$1,038 million** in Q4 2024, driven by lower salaries and FDIC assessments Quarterly Non-Interest Expense ($ millions) | Expense Category | 12/31/2024 | 9/30/2024 | 12/31/2023 | 4Q24 vs. 3Q24 (%) | 4Q24 vs. 4Q23 (%) | | :------------------------------------ | :--------- | :-------- | :--------- | :---------------- | :---------------- | | Salaries and employee benefits ($ millions) | $617 | $645 | $608 | (4.3) | 1.5 | | Equipment and software expense ($ millions) | $104 | $101 | $102 | 3.0 | 2.0 | | Net occupancy expense ($ millions) | $67 | $69 | $71 | (2.9) | (5.6) | | FDIC insurance assessments ($ millions) | $20 | $17 | $147 | 17.6 | (86.4) | | Operational losses ($ millions) | $16 | $19 | $29 | (15.8) | (44.8) | | **Total non-interest expense ($ millions)** | **$1,038** | **$1,069**| **$1,185** | **(2.9)** | **(12.4)** | - FDIC insurance assessments decreased significantly by **86.4%** YoY, reflecting a reduction to the Company's FDIC special assessment accrual[50](index=50&type=chunk) - Salaries and employee benefits decreased by **4.3%** QoQ, contributing to the overall expense reduction[50](index=50&type=chunk) [Annual Non-Interest Expense Breakdown](index=18&type=section&id=Annual%20Non-Interest%20Expense%20Breakdown) Total non-interest expense decreased by **3.9%** to **$4,242 million** in 2024, primarily due to reduced FDIC assessments and operational losses Annual Non-Interest Expense ($ millions) | Expense Category | 2024 | 2023 | 2024 vs. 2023 (%) | | :------------------------------------ | :--- | :--- | :---------------- | | Salaries and employee benefits ($ millions) | $2,529 | $2,416 | 4.7 | | FDIC insurance assessments ($ millions) | $109 | $228 | (52.2) | | Operational losses ($ millions) | $95 | $212 | (55.2) | | **Total non-interest expense ($ millions)** | **$4,242**| **$4,416**| **(3.9)** | - FDIC insurance assessments decreased by **52.2%** year-over-year, reflecting accrual reductions[50](index=50&type=chunk) - Operational losses decreased by **55.2%** year-over-year, contributing significantly to the overall expense reduction[50](index=50&type=chunk) [Reconciliation of GAAP Financial Measures to non-GAAP Financial Measures](index=19&type=section&id=Reconciliation%20of%20GAAP%20Financial%20Measures%20to%20non-GAAP%20Financial%20Measures) [Adjusted Efficiency Ratios, Adjusted Fee Income Ratios, Adjusted Non-Interest Income/Expense, Adjusted Operating Leverage Ratios, and Adjusted Total Revenue](index=19&type=section&id=Adjusted%20Efficiency%20Ratios%2C%20Adjusted%20Fee%20Income%20Ratios%2C%20Adjusted%20Non-Interest%20Income%2FExpense%2C%20Adjusted%20Operating%20Leverage%20Ratios%2C%20and%20Adjusted%20Total%20Revenue) Adjusted efficiency ratio (non-GAAP) improved to **55.4%** in Q4 2024, indicating better operational efficiency and decreased expenses Quarterly Adjusted Ratios (Q4 2024 vs. Q3 2024 vs. Q4 2023) | Metric | 12/31/2024 | 9/30/2024 | 12/31/2023 | | :------------------------------------------------ | :--------- | :-------- | :--------- | | Adjusted non-interest expense (non-GAAP) ($ millions) | $1,029 | $1,069 | $1,038 | | Adjusted total revenue, taxable equivalent basis (non-GAAP) ($ millions) | $1,858 | $1,880 | $1,825 | | Adjusted efficiency ratio (non-GAAP) (%) | 55.4 % | 56.9 % | 56.9 % | | Adjusted fee income ratio (non-GAAP) (%) | 33.1 % | 34.6 % | 31.8 % | - Adjustments to non-interest expense included a **$2 million** reduction in FDIC insurance special assessment accrual in Q4 2024[54](index=54&type=chunk) - For the full year 2024, the adjusted efficiency ratio (non-GAAP) was **57.6%**, an increase from **55.9%** in 2023, while adjusted total revenue (non-GAAP) decreased by **3.8%**[57](index=57&type=chunk) [Return Ratios](index=21&type=section&id=Return%20Ratios) Return on average tangible common shareholders' equity (non-GAAP) increased to **19.19%** in Q4 2024, showing improved profitability Quarterly Return Ratios (Q4 2024 vs. Q3 2024 vs. Q4 2023) | Metric | 12/31/2024 | 9/30/2024 | 12/31/2023 | | :------------------------------------------------ | :--------- | :-------- | :--------- | | Return on average common shareholders' equity (GAAP)* (%) | 12.39 % | 10.88 % | 9.95 % | | Return on average tangible common shareholders' equity (non-GAAP)* (%) | 19.19 % | 16.87 % | 16.57 % | | Return on average tangible common shareholders' equity excluding AOCI (non-GAAP)* (%) | 15.46 % | 13.69 % | 11.45 % | - For the full year 2024, return on average tangible common shareholders' equity (non-GAAP) was **17.77%**, down from **21.93%** in 2023[61](index=61&type=chunk) [Tangible Common Ratios](index=22&type=section&id=Tangible%20Common%20Ratios) Tangible common shareholders' equity to tangible assets (non-GAAP) was **6.86%** in Q4 2024, a decrease from Q3 2024 Quarterly Tangible Common Ratios (Q4 2024 vs. Q3 2024 vs. Q4 2023) | Metric | 12/31/2024 | 9/30/2024 | 12/31/2023 | | :------------------------------------------------ | :--------- | :-------- | :--------- | | Tangible common shareholders' equity (non-GAAP) ($ millions) | $10,388 | $11,172 | $9,944 | | Tangible common shareholders' equity to tangible assets (non-GAAP) (%) | 6.86 % | 7.37 % | 6.79 % | | Tangible common book value per share (non-GAAP) | $11.42 | $12.26 | $10.77 | - The decrease in tangible common shareholders' equity to tangible assets was primarily due to a decrease in tangible common shareholders' equity[64](index=64&type=chunk) [Common Equity Tier 1 (CET1) Ratios](index=22&type=section&id=Common%20Equity%20Tier%201%20(CET1)%20Ratios) Estimated Common Equity Tier 1 (CET1) ratio increased to **10.8%** in Q4 2024, while the adjusted ratio was **8.8%** Quarterly CET1 Ratios (Q4 2024 vs. Q3 2024 vs. Q4 2023) | Metric | 12/31/2024 | 9/30/2024 | 12/31/2023 | | :------------------------------------------------ | :--------- | :-------- | :--------- | | Common equity Tier 1 (estimated) ($ millions) | $13,434 | $13,185 | $12,976 | | Total risk-weighted assets (estimated) ($ millions) | $124,493 | $124,645 | $126,475 | | Common equity Tier 1 ratio (estimated) (%) | 10.8 % | 10.6 % | 10.3 % | | Adjusted common equity Tier 1 ratio (non-GAAP) (estimated) (%) | 8.8 % | 9.1 % | 8.3 % | - The adjusted CET1 ratio decreased QoQ due to a larger AOCI loss on securities in Q4 2024[66](index=66&type=chunk) [Credit Quality](index=23&type=section&id=Credit%20Quality) [Allowance for Credit Losses, Net Charge-Offs and Related Ratios](index=23&type=section&id=Allowance%20for%20Credit%20Losses%2C%20Net%20Charge-Offs%20and%20Related%20Ratios) Allowance for Credit Losses remained stable at **$1,729 million** in Q4 2024, with net charge-offs increasing slightly QoQ Quarterly Net Charge-Offs by Loan Category ($ millions) | Loan Category | 12/31/2024 | 9/30/2024 | 12/31/2023 | | :------------------------------------ | :--------- | :-------- | :--------- | | Commercial and industrial ($ millions) | $39 | $55 | $34 | | Total business ($ millions) | $64 | $68 | $34 | | Total consumer ($ millions) | $55 | $49 | $98 | | **Total Net charge-offs ($ millions)** | **$119** | **$117** | **$132** | Key Credit Ratios (Q4 2024 vs. Q3 2024 vs. Q4 2023) | Metric | 12/31/2024 | 9/30/2024 | 12/31/2023 | | :------------------------------------------------ | :--------- | :-------- | :--------- | | ACL/Loans, net (%) | 1.79 % | 1.79 % | 1.73 % | | Allowance for credit losses to non-performing loans, excluding loans held for sale (%) | 186 % | 210 % | 211 % | | Net charge-offs as a % of average loans, annualized (%) | 0.49 % | 0.48 % | 0.54 % | - For the full year 2024, net charge-offs were **$458 million**, up from **$397 million** in 2023, with the net loan charge-offs as a % of average loans increasing to **0.47%** from **0.40%**[72](index=72&type=chunk) [Adjusted Net Charge-offs and Ratio (non-GAAP)](index=25&type=section&id=Adjusted%20Net%20Charge-offs%20and%20Ratio%20(non-GAAP)) Adjusted net loan charge-offs (non-GAAP) for Q4 2024 were **$119 million**, consistent with GAAP figures due to no loan sale adjustments Adjusted Net Charge-offs ($ millions) and Ratio (Q4 2024 vs. Q4 2023) | Metric | 12/31/2024 | 12/31/2023 | | :------------------------------------------------ | :--------- | :--------- | | Net loan charge-offs (GAAP) ($ millions) | $119 | $132 | | Less: charge-offs associated with the sale of loans ($ millions) | — | $35 | | Adjusted net loan charge-offs (non-GAAP) ($ millions) | $119 | $97 | | Adjusted net loan charge-offs as a % of average loans, annualized (non-GAAP) (%) | 0.49 % | 0.39 % | - In Q4 2023, **$35 million** in charge-offs were associated with the sale of a loan portfolio, which is excluded from the adjusted non-GAAP measure[73](index=73&type=chunk)[74](index=74&type=chunk) - For the full year 2024, adjusted net loan charge-offs were **$458 million**, with an adjusted ratio of **0.47%**, compared to **$362 million** and **0.37%** in 2023[74](index=74&type=chunk) [Non-Accrual Loans, Early and Late Stage Delinquencies](index=26&type=section&id=Non-Accrual%20Loans%2C%20Early%20and%20Late%20Stage%20Delinquencies) Non-performing loans increased to **$928 million** in Q4 2024, representing **0.96%** of total loans, with commercial real estate rising Non-Performing Loans (Excludes Loans Held for Sale) ($ millions) | Loan Category | 12/31/2024 | 9/30/2024 | 12/31/2023 | | :------------------------------------ | :--------- | :-------- | :--------- | | Commercial and industrial ($ millions) | $408 | $430 | $471 | | Commercial investor real estate mortgage ($ millions) | $423 | $287 | $233 | | Total non-performing loans ($ millions) | $928 | $821 | $805 | | Non-performing loans as % of loans (%) | 0.96 % | 0.85 % | 0.82 % | Total Delinquencies ($ millions) | Delinquency Stage | 12/31/2024 | 9/30/2024 | 12/31/2023 | | :------------------------------------ | :--------- | :-------- | :--------- | | Accruing 30-89 Days Past Due Loans ($ millions) | $367 | $369 | $330 | | Accruing 90+ Days Past Due Loans ($ millions) | $166 | $183 | $171 | | **Total delinquencies ($ millions)** | **$533** | **$552** | **$501** | - Commercial investor real estate mortgage non-performing loans increased significantly to **$423 million** in Q4 2024 from **$287 million** in Q3 2024[75](index=75&type=chunk) [Forward-Looking Statements](index=27&type=section&id=Forward-Looking%20Statements) [Risks and Uncertainties](index=27&type=section&id=Risks%20and%20Uncertainties) Key risks include economic conditions, interest rate volatility, regulatory changes, technological advancements, and operational risks like cybersecurity - Current and future economic and market conditions, including property values, interest rates, unemployment, and inflation, may adversely affect lending and financial results[80](index=80&type=chunk) - Changes in market interest rates or capital markets could impact revenue, expenses, asset values, and the availability and cost of capital and liquidity[80](index=80&type=chunk) - The ability to effectively compete with traditional and non-traditional financial services companies, including fintechs, and to keep pace with technological changes, including AI, is crucial for future success[80](index=80&type=chunk) - Operational risks, such as data security breaches, malware, ransomware, and failures of third-party infrastructure, could disrupt businesses and lead to financial losses or reputational harm[80](index=80&type=chunk)[85](index=85&type=chunk)

Table of Contents or UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form10-Q ☒ Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the quarterly period ended September 30, 2024 ☐ Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the transition period from to Commission File Number: 001-34034 | --- | --- | --- | |-----------------------------------------------------------------------------------------| ...

Financial Data and Key Metrics Changes - The company reported strong third quarter earnings of $446 million, resulting in earnings per share of $0.49 [6] - Total revenue grew on both a reported and adjusted basis, with improvements in net interest income and fee revenue [6] - Adjusted noninterest expense increased modestly quarter-over-quarter, while average loans remained stable and ending loans declined slightly [6][10] Business Line Data and Key Metrics Changes - Average consumer loans remained stable, with modest growth in credit cards offset by declines in other categories [10] - Adjusted noninterest income increased by 9%, driven by improvements in service charges, capital markets, and wealth management [14] - Capital markets revenue increased by 35% due to higher M&A advisory fees and increased securities underwriting [14] Market Data and Key Metrics Changes - Average deposits declined slightly, while ending deposits remained stable during the quarter [7] - The percentage of noninterest-bearing deposits remained stable in the low 30% range [11] - The company expects real GDP to be in the 2% range in 2025, indicating a cautiously optimistic economic outlook [24] Company Strategy and Development Direction - The company is focused on understanding customer needs and providing tailored solutions, positioning itself to support clients as macroeconomic conditions improve [7] - Investments are being made in talent, technology, and products to benefit from improving macroeconomic conditions [8] - The company aims to generate positive operating leverage in 2025 by managing expenses and focusing on revenue generation [37] Management's Comments on Operating Environment and Future Outlook - Management noted that corporate customers remain cautiously optimistic, with hesitance in capital expenditures until political and economic uncertainties are resolved [7] - Credit metrics have stabilized, and overall credit performance continued to improve during the quarter [16] - The company expects to maintain its common equity Tier 1 ratio and provide capital flexibility for strategic growth objectives [18] Other Important Information - The company recognized $14 million in expenses related to ongoing litigation with Visa [15] - Nonperforming loans as a percentage of total loans declined to 0.85% [17] - The company transferred $2.5 billion of available-for-sale securities to held-to-maturity to reduce volatility [18] Q&A Session Summary Question: Insights on NII momentum and future margin expectations - Management remains confident in achieving a margin closer to 3.60 in the future, despite a potential step back in the fourth quarter [19][20] Question: Loan demand and growth catalysts - Management indicated that while pipelines are softer, modest growth in loans is expected in 2025 as economic clarity improves [22][23] Question: Confidence in expense management and operating leverage - Management expressed confidence in maintaining expense estimates and achieving positive operating leverage in 2025 [25][26] Question: Credit charge-offs outlook - Management expects charge-offs to remain in the 40 to 50 basis points range, with good consumer credit performance [29][30] Question: Deposit pricing and growth implications - Management anticipates continued decline in deposit costs and is positioned to grow deposits while balancing loan growth [31][48] Question: Investment in capital markets and private credit - Management is monitoring developments in private credit but currently has no specific plans for investment in that area [50]

Exhibit 99.2 Regions Financial Corporation and Subsidiaries Financial Supplement (unaudited) Third Quarter 2024 Regions Financial Corporation and Subsidiaries Financial Supplement (unaudited) to Third Quarter 2024 Earnings Release Table of Contents | --- | --- | |-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-------| | | Page | | | | | Fina ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form10-Q ☒ Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the quarterly period ended June 30, 2024 or ☐ Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the transition period from to Commission File Number: 001-34034 Regions Financial Corporation (Exact name of registrant as specified in its charter) (State or other jurisdiction of ...