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| 8-K - FORM 8-K - REGIONS FINANCIAL CORP | d354769d8k.htm |
 2012
DEUTSCHE
BANK
GLOBAL
FINANCIAL SERVICES
INVESTOR CONFERENCE
May 21, 2012
Grayson Hall
Chief Executive Officer
Exhibit 99.1 |
 FRANCHISE OVERVIEW
•
Associates: 23,619
•
Assets: $128B
•
Loans: $77B
•
Deposits: $97B
•
Branches: 1,722
•
Insurance Offices: 30
•
ATMs: 2,070
•
Market Cap: $9.4B*
*As of May 10, 2012
Business Services
Small and mid-sized C&I lending
Commercial Real Estate
Equipment Finance
Consumer Services
Wealth Management
Private Banking
Insurance
Trust Services
Ranked 4th or Better in Market Share
Targeted Growth Areas
2
Mortgage
Home Equity
Credit Card
Direct Lending
Indirect Auto
|
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Top 10 MSAs
Deposits
Market
Share
Market
Rank
’10-’15
Population
Growth
Birmingham, AL
$11.0
37.6%
1
Nashville, TN
$6.6
17.3%
1
Miami, FL
$4.8
3.1%
7
Tampa, FL
$4.4
8.7%
4
Memphis, TN
$3.8
16.8%
2
Atlanta, GA
$3.4
3.0%
6
St. Louis, MO
$3.0
4.7%
4
Jackson, MS
$2.8
25.5%
2
New Orleans, LA
$2.4
8.3%
4
Mobile, AL
$2.3
38.2%
1
($ in billions)
National Average: 3.9%
REGIONS’
FOOTPRINT IS CHARACTERIZED BY EITHER HIGH
MARKET SHARE, HIGH GROWTH MARKETS OR BOTH
Source: SNL Financial
Note: Core Markets include AL, FL, LA, MS, AR, TN
Weighted Average Deposit Market
Share in Regions’
Core Markets
Rank
Name
Market
Share
1
Bank of America
11.5%
2
Regions
9.8%
3
Wells Fargo
9.4%
4
SunTrust
6.9%
5
JPMorgan Chase
3.3%
6
BB&T
2.5%
7
Capital One
2.3%
8
First Horizon
2.0%
9
Hancock
1.9%
10
PNC
1.4% |
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A QUARTER OF SIGNIFICANT ACCOMPLISHMENT
Key Milestones
Broad-Based Asset Quality
Improvement
1Q12 Results
•
No objection to Capital Plan
•
Closed Morgan Keegan Sale
•
Successful common equity offering
•
Credit Ratings upgrade
•
Redeemed $3.5 billion of Series A
preferred stock
•
Net income available to common
shareholders of $145MM or $0.11
per diluted share
•
Income from continuing operations
$0.14 per diluted share
•
Net charge-offs decreased $98MM or
23% to $332MM
•
Lowest quarterly loan loss provision in
more than four years at $117MM
•
NPLs declined 9%
•
Inflows of NPLs down 32% to $381 MM |
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OPPORTUNITY FOR OUTPERFORMANCE
REVENUE
EXPENSES
CREDIT
•
Tangible opportunity to close peer margin gap
•
Over $11 billion of deposit repricing in the next 4 quarters
•
Lower liquidity costs
•
Level of non-accruals
•
Continued momentum in C&I and Consumer lending
•
Real estate expertise intact
•
Durbin mitigation efforts underway
•
Ongoing expense initiatives
•
Branch rationalization
•
Removed Morgan Keegan overhead / cost structure
•
Anticipating reduced credit related / OREO expenses
•
Solid reserve position
•
Reduced provisions with continued credit improvement
|
 6
INVESTMENT THESIS |
 FORWARD-LOOKING STATEMENTS
This presentation may include forward-looking statements which reflect Regions’ current views
with respect to future events and financial performance. The Private Securities Litigation Refor
Act of 1995 (“ the Act” ) provides a “ safe harbor” for forward-looking
statements which are identified as such and are accompanied by the identification of important factors that could caus
actual results to differ materially from the forward-looking statements. For these statements, we,
together with our subsidiaries, claim the protection afforded by the safe harbor in the Act
Forward-looking statements are not based on historical information, but rather are related to
future operations, strategies, financial results or other developments. Forward-looking statement
are based on management’s expectations as well as certain assumptions and estimates made by, and
information available to, management at the time the statements are made. Thos statements are
based on general assumptions and are subject to various risks, uncertainties and other factors that may cause actual results to differ materially from the views, beliefs an
projections expressed in such statements. These risks, uncertainties and other factors include,
but are not limited to, those described below: ›
The Dodd-Frank Wall Street Reform and Consumer Protection Act (the “ Dodd-Frank
Act” ) became law on July 21, 2010, and a number of legislative, regulatory and tax proposals
remain pending. Additionally, the U.S. Treasury and federal banking regulators continue to implement,
but are also beginning to wind down, a number of programs to address capital and liquidity in
the banking system. Future and proposed rules, including those that are part of the Basel III process, could require banking institutions to increase levels of capital. All
of the foregoing may have significant effects on Regions and the financial services industry, the
exact nature of which cannot be determined at this time. › Regions' ability to mitigate
the impact of the Dodd-Frank Act on debit interchange fees through revenue enhancements and other revenue measures, which will depend on various
factors, including the acceptance by our customers of modified fee structures for Regions' products
and services. › Possible additional loan losses, impairment of goodwill and other
intangibles, and adjustment of valuation allowances on deferred tax assets and the impact on earnings and capital.
› Possible changes in interest rates may increase funding costs and reduce earning asset yields,
thus reducing margins. Increases in benchmark interest rates would also increas debt service
requirements for customers whose terms include a variable interest rate, which may negatively impact the ability of borrowers to pay as contractually obligated.
› Possible changes in general economic and business conditions in the United States in general
and in the communities Regions serves in particular, including any prolonging or worsening of
the current unfavorable economic conditions including unemployment levels. ›
Possible changes in the creditworthiness of customers and the possible impairment of the collectability of loans.
› Possible changes in trade, monetary and fiscal policies, laws and regulations and other
activities of governments, agencies, and similar organizations, may have an adverse effect on
business. › Possible stresses in the financial and real estate markets, including possible
continued deterioration in property values. › Regions' ability to manage fluctuations in
the value of assets and liabilities and off-balance sheet exposure so as to maintain sufficient capital and liquidity to support Regions'
business.
› Regions' ability to expand into new markets and to maintain profit margins in the face of
competitive pressures. › Regions' ability to develop competitive new products and services
in a timely manner and the acceptance of such products and services by Regions' customers and potential
customers.
› Regions' ability to keep pace with technological changes.
› Regions' ability to effectively manage credit risk, interest rate risk, market risk,
operational risk, legal risk, liquidity risk, and regulatory and compliance risk. ›
Regions’ ability to ensure adequate capitalization which is impacted by inherent uncertainties in forecasting credit losses.
›
The cost and other effects of material contingencies, including litigation contingencies, and any
adverse judicial, administrative or arbitral rulings or proceedings. › The effects of
increased competition from both banks and non-banks. › The effects of geopolitical
instability and risks such as terrorist attacks. › Possible changes in consumer and
business spending and saving habits could affect Regions' ability to increase assets and to attract deposits.
› The effects of weather and natural disasters such as floods, droughts, wind, tornados and
hurricanes, and the effects of man-made disasters. › Possible downgrades in
ratings issued by rating agencies. › Possible changes in the speed of loan prepayments by
Regions’ customers and loan origination or sales volumes. › Possible acceleration of
prepayments on mortgage-backed securities due to low interest rates and the related acceleration of premium amortization on those securities.
› The effects of problems encountered by larger or similar financial institutions that adversely
affect Regions or the banking industry generally. › Regions’ ability to receive
dividends from its subsidiaries. › The effects of the failure of any component of
Regions’ business infrastructure which is provided by a third party. › Changes in
accounting policies or procedures as may be required by the Financial Accounting Standards Board or other regulatory agencies.
› With regard to the sale of Morgan Keegan the possibility of business disruption following the
transaction; reputational risks and the reaction of customers and counterparties to the
transaction; and occurrences which could cause post-closing adjustments to the purchase price.
› The effects of any damage to Regions’ reputation resulting from developments
related to any of the items identified above. › The foregoing list of factors is not
exhaustive. For discussion of these and other factors that may cause actual results to differ from expectations, look under the captions “ Forward-
Looking Statements” and “ Risk Factors” in Regions’ Annual Report on Form 10-K
for the year ended December 31, 2011. › The words "believe," "expect,"
"anticipate," "project," and similar expressions often signify forward-looking statements. You should not place undue reliance on any forward-looking
statements, which speak only as of the date made. We assume no obligation to update or revise any
forward-looking statements that are made from time to time.
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