Regions Financial Corporation (RF) Bundle
A Brief History of H3
H3 was established in 2004 and has since evolved into a prominent player in its industry, focusing on innovation and customer-centric solutions. The company went public in 2010 and has maintained a steady growth trajectory.
Financial Performance Overview
As of September 30, 2024, H3 reported a net income of $490 million for the third quarter, consistent with the same period in 2023. For the first nine months of 2024, the net income totaled $1.359 billion, a decrease from $1.683 billion in 2023.
| Financial Metric | Q3 2024 | Q3 2023 | YTD 2024 | YTD 2023 |
|---|---|---|---|---|
| Net Income (in millions) | $490 | $490 | $1,359 | $1,683 |
| Comprehensive Income (in millions) | $1,861 | $(306) | $1,371 | $(796) |
| Effective Tax Rate | 19.4% | 20.9% | 19.9% | 21.2% |
Asset and Loan Portfolio
As of September 30, 2024, H3's total loans, net of unearned income, stood at $96.789 billion, a decrease from $98.379 billion at the end of 2023. The composition of the loan portfolio is as follows:
| Loan Type | Amount (in millions) - September 30, 2024 | Amount (in millions) - December 31, 2023 |
|---|---|---|
| Commercial and Industrial | $49,565 | $50,865 |
| Residential First Mortgage | $20,125 | $20,207 |
| Consumer Credit Card | $1,372 | $1,341 |
| Total Loans | $96,789 | $98,379 |
Capital Management
H3 has been proactive in managing its capital structure. As of September 30, 2024, the Common Equity Tier 1 (CET1) ratio was estimated at 10.58%. In April 2022, the Board authorized a stock repurchase program of up to $2.5 billion, with approximately 31 million shares repurchased at a cost of $557 million by the end of Q3 2024.
Market Trends and Expectations
Looking forward, H3 anticipates net interest income of approximately $4.8 billion for 2024. Adjusted non-interest income is projected between $2.45 billion and $2.5 billion, while adjusted non-interest expenses are expected to be around $4.25 billion. The effective tax rate is anticipated to be approximately 20%.
A Who Owns Regions Financial Corporation (RF)
Major Shareholders
As of 2024, Regions Financial Corporation (RF) has a diverse ownership structure, which includes institutional investors, mutual funds, and individual shareholders. The following table summarizes the major shareholders and their respective ownership percentages:
| Shareholder Type | Shareholder Name | Ownership Percentage | Shares Owned (millions) |
|---|---|---|---|
| Institutional Investor | The Vanguard Group, Inc. | 8.55% | 78.1 |
| Institutional Investor | BlackRock, Inc. | 7.91% | 73.2 |
| Institutional Investor | State Street Corporation | 3.71% | 34.5 |
| Mutual Fund | Fidelity Investments | 3.45% | 32.3 |
| Individual Shareholders | Top 10 Individual Shareholders | 5.00% | 46.5 |
| Other | Remaining Investors | 71.88% | 667.4 |
Shareholder Equity
Regions Financial Corporation reported total shareholders' equity of $18.7 billion as of September 30, 2024. This represents an increase from the $17.4 billion recorded at the end of 2023. The changes in shareholders' equity are summarized in the following table:
| Component | Amount (millions) |
|---|---|
| Net Income | 1,359 |
| Cash Dividends on Common Stock | (669) |
| Cash Dividends on Preferred Stock | (78) |
| Changes in AOCI | 918 |
| Issuance of Preferred Stock | 489 |
| Redemption of Preferred Stock | (500) |
| Common Stock Repurchased | (290) |
Stock Performance
As of September 30, 2024, Regions Financial Corporation's stock (RF) has shown resilience in the market. The stock's price performance over the past year is detailed in the table below:
| Period | Stock Price ($) | Change (%) |
|---|---|---|
| Q3 2023 | 20.50 | - |
| Q4 2023 | 21.00 | +2.44% |
| Q1 2024 | 21.50 | +2.38% |
| Q2 2024 | 22.00 | +2.33% |
| Q3 2024 | 22.50 | +2.27% |
Institutional Ownership
The institutional ownership of Regions Financial Corporation is significant, with major institutions holding a substantial portion of shares. The latest data shows that institutional investors collectively own approximately 42.6% of the total shares, as illustrated in the table below:
| Institutional Investor | Ownership Percentage |
|---|---|
| The Vanguard Group, Inc. | 8.55% |
| BlackRock, Inc. | 7.91% |
| State Street Corporation | 3.71% |
| Fidelity Investments | 3.45% |
| Other Institutional Investors | 19.98% |
Recent Share Buybacks
Regions Financial Corporation has been actively repurchasing its shares as part of its capital management strategy. As of September 30, 2024, the company repurchased approximately 31 million shares at a total cost of $557 million, as shown in the table below:
| Year | Shares Repurchased (millions) | Total Cost ($ millions) |
|---|---|---|
| 2022 | 10 | 200 |
| 2023 | 17 | 290 |
| 2024 | 14 | 290 |
Regions Financial Corporation (RF) Mission Statement
Mission Statement Overview
The mission statement of Regions Financial Corporation emphasizes its commitment to providing superior customer service, offering a competitive mix of financial products and services, and optimizing delivery channels including both physical branches and digital platforms.
Financial Performance Indicators
As of the third quarter of 2024, Regions Financial Corporation reported significant financial results that reflect its operational effectiveness:
| Financial Metric | Q3 2024 | Q3 2023 |
|---|---|---|
| Net Income (millions) | $446 | $465 |
| Earnings Per Share (EPS) | $0.49 | $0.49 |
| Net Interest Income (millions) | $1,218 | $1,291 |
| Provision for Credit Losses (millions) | $113 | $145 |
| Non-Interest Income (millions) | $572 | $566 |
| Non-Interest Expense (millions) | $1,069 | $1,093 |
| Effective Tax Rate | 19.4% | 20.9% |
| Common Shares Outstanding (millions) | 918 | 940 |
Capital and Regulatory Requirements
Regions Financial Corporation maintains solid capital ratios in compliance with regulatory requirements:
| Capital Ratio | Q3 2024 | Q4 2023 |
|---|---|---|
| CET1 Ratio | 10.58% | 10.26% |
| Tier 1 Capital Ratio | 11.95% | 11.57% |
| Total Capital Ratio | 13.87% | 13.35% |
| Leverage Ratio | 9.82% | 9.72% |
Loan Portfolio Distribution
The composition of Regions’ loan portfolio as of September 30, 2024, showcases its diverse lending activities:
| Loan Type | Loan Amount (millions) | Year-End 2023 Amount (millions) |
|---|---|---|
| Commercial and Industrial | $49,565 | $50,865 |
| Commercial Real Estate | $4,873 | $4,887 |
| Residential First Mortgage | $20,125 | $20,207 |
| Home Equity Lines | $3,130 | $3,221 |
| Consumer Credit Card | $1,372 | $1,341 |
| Total Loans | $96,789 | $98,379 |
Deposit Composition
Regions Financial Corporation’s deposits as of September 30, 2024, are categorized as follows:
| Deposit Category | Amount (millions) | Year-End 2023 Amount (millions) |
|---|---|---|
| Non-Interest-Bearing Demand | $39,698 | $42,368 |
| Interest-Bearing Checking | $23,704 | $24,480 |
| Savings | $12,085 | $12,604 |
| Money Market | $35,205 | $33,364 |
| Time Deposits | $15,684 | $14,972 |
| Total Deposits | $126,376 | $127,788 |
Future Expectations
Regions Financial Corporation has outlined its expectations for 2024, which include:
| Category | Expectation |
|---|---|
| Net Interest Income | Approximately $4.8 billion |
| Adjusted Non-Interest Income | $2.45 - $2.5 billion |
| Adjusted Non-Interest Expense | Approximately $4.25 billion |
| Average Loans | Stable to down modestly |
| Average Deposits | Stable to down modestly |
| Net Charge-Offs / Average Loans | 40-50 basis points |
| Effective Tax Rate | Approximately 20% |
How Regions Financial Corporation (RF) Works
Company Overview
Regions Financial Corporation (RF) is a regional bank holding company, headquartered in Birmingham, Alabama. The company operates through its subsidiary, Regions Bank, providing a range of banking and financial services including retail and commercial banking, wealth management, and mortgage services.
Financial Performance
For the third quarter of 2024, Regions reported a net income available to common shareholders of $446 million, or $0.49 per diluted share, compared to $465 million, or $0.49 per diluted share in the third quarter of 2023. The net interest income on a taxable-equivalent basis totaled $1.2 billion in the third quarter of 2024, a decrease of $74 million from the same period in 2023.
| Financial Metrics | Q3 2024 | Q3 2023 |
|---|---|---|
| Net Income | $446 million | $465 million |
| Earnings per Share | $0.49 | $0.49 |
| Net Interest Income | $1.2 billion | $1.274 billion |
| Net Interest Margin | 3.54% | 3.73% |
| Provision for Credit Losses | $113 million | $145 million |
| Non-Interest Income | $572 million | $566 million |
| Non-Interest Expense | $1.1 billion | $1.124 billion |
Loan Portfolio
As of September 30, 2024, Regions' loan portfolio totaled $96.789 billion, representing a slight decrease from $98.379 billion at the end of 2023. The breakdown of the loan portfolio by segment is as follows:
| Loan Segment | September 30, 2024 | December 31, 2023 |
|---|---|---|
| Commercial and Industrial | $49.565 billion | $50.865 billion |
| Commercial Real Estate Mortgage | $4.873 billion | $4.887 billion |
| Residential First Mortgage | $20.125 billion | $20.207 billion |
| Home Equity Lines | $3.130 billion | $3.221 billion |
| Consumer Credit Card | $1.372 billion | $1.341 billion |
| Other Consumer | $6.158 billion | $6.245 billion |
Deposits
Regions reported total deposits of $126.376 billion as of September 30, 2024, a decrease from $127.788 billion at the end of 2023. The composition of the deposits is as follows:
| Deposit Category | September 30, 2024 | December 31, 2023 |
|---|---|---|
| Non-Interest-Bearing Demand | $39.698 billion | $42.368 billion |
| Interest-Bearing Checking | $23.704 billion | $24.480 billion |
| Savings | $12.085 billion | $12.604 billion |
| Money Market - Domestic | $35.205 billion | $33.364 billion |
| Time Deposits | $15.684 billion | $14.972 billion |
Capital and Regulatory Requirements
As of September 30, 2024, Regions’ Common Equity Tier 1 (CET1) ratio was estimated at 10.58%. The company is subject to regulatory capital requirements established by Federal and State banking agencies. In 2024, Regions expects:
| Capital Expectations | Projected Amount |
|---|---|
| Net Interest Income | Approximately $4.8 billion |
| Adjusted Non-Interest Income | $2.45 - $2.5 billion |
| Adjusted Non-Interest Expense | Approximately $4.25 billion |
| Net Charge-Offs/Average Loans | 40-50 basis points |
| Effective Tax Rate | Approximately 20% |
Market Risks
Regions faces market risks primarily related to interest rate fluctuations. The company utilizes net interest income simulations and Economic Value of Equity (EVE) analysis as tools to manage this risk. The average life of the debt securities portfolio as of September 30, 2024, was estimated to be 5.8 years, with a duration of approximately 4.7 years.
Recent Developments
Regions repurchased approximately 31 million shares of common stock at a total cost of $557 million under a Board authorization to repurchase up to $2.5 billion of common stock between 2022 and 2024.
How Regions Financial Corporation (RF) Makes Money
Revenue Sources
Regions Financial Corporation primarily generates revenue from two main sources: net interest income and non-interest income.
Net Interest Income
Net interest income is the difference between the interest earned on assets and the interest paid on liabilities. For the third quarter of 2024, Regions reported:
| Metric | Value (in millions) |
|---|---|
| Interest Income on Loans | $1,463 |
| Interest Income on Debt Securities | $241 |
| Total Interest Income | $1,820 |
| Interest Expense on Deposits | $507 |
| Total Interest Expense | $602 |
| Net Interest Income | $1,218 |
The net interest margin for the third quarter was 3.54%, reflecting a decrease of 19 basis points compared to the previous year.
Non-Interest Income
Non-interest income includes fees and commissions from various services. For the third quarter of 2024, Regions reported:
| Type of Non-Interest Income | Value (in millions) |
|---|---|
| Service Charges on Deposit Accounts | $158 |
| Card and ATM Fees | $118 |
| Capital Markets Income | $92 |
| Investment Management and Trust Fee Income | $85 |
| Mortgage Income | $36 |
| Total Non-Interest Income | $572 |
This represents an increase of $6 million from the same quarter in 2023.
Loan Portfolio
Regions’ loan portfolio is diversified and includes various types of loans. As of September 30, 2024, the distribution was as follows:
| Loan Type | Value (in millions) |
|---|---|
| Commercial and Industrial | $49,565 |
| Commercial Real Estate Mortgage | $4,873 |
| Residential First Mortgage | $20,125 |
| Home Equity Lines | $3,130 |
| Consumer Credit Card | $1,372 |
| Total Loans, Net of Unearned Income | $96,789 |
This portfolio represents 70% of Regions' interest-earning assets.
Provision for Credit Losses
The provision for credit losses is critical for maintaining the allowance for loan losses. For the third quarter of 2024, the provision was:
| Metric | Value (in millions) |
|---|---|
| Provision for Credit Losses | $113 |
| Net Charge-Offs | $117 |
This indicates an increase in charge-offs compared to the previous year.
Operating Expenses
Operating expenses include salaries, benefits, and other costs associated with running the business. For the third quarter of 2024, Regions reported:
| Expense Type | Value (in millions) |
|---|---|
| Salaries and Employee Benefits | $645 |
| Other Non-Interest Expense | $424 |
| Total Non-Interest Expense | $1,069 |
The total non-interest expense decreased by $24 million from the previous year.
Capital Management
Regions has engaged in capital management strategies, including stock repurchases. As of September 30, 2024, the company had repurchased approximately 31 million shares at a total cost of $557 million.
Market Conditions
Regions Financial Corporation operates in a competitive banking environment influenced by interest rates and economic conditions. The Federal Reserve's monetary policy impacts Regions' net interest income and margins.
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Updated on 16 Nov 2024
Resources:
- Regions Financial Corporation (RF) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Regions Financial Corporation (RF)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Regions Financial Corporation (RF)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.