Regions Financial Q4 Results Miss Estimates

(RTTNews) - Bank holding company Regions Financial Corp. (RF) reported Tuesday a profit for the fourth quarter that declined from last year, despite lower provision for loan losses, as well as continued loan growth, reflecting lower net interest margins and a revenue decline. Both earnings per share and quarterly revenues missed analysts' expectations.

Loan balances improved by $700 million or 1 percent to end the fourth quarter at $77 billion, with new loan production increasing 14 percent over the previous year as both the business and consumer loan portfolios grew. Regions said it maintained solid asset quality and risk discipline in the fourth quarter.

"The fourth quarter rounded out a solid year in which we grew loans, increased deposit balances, and improved asset quality and capital ratios. As we execute our strategy to deepen relationships with customers and improve efficiencies across our business, we are well-positioned for continued progress in 2015," President, Chairman and CEO Grayson Hall said in a statement.

The Birmingham, Alabama-based parent of Regions Bank reported a net income of $195 million or $0.14 per share for the fourth quarter, lower than $219 million or $0.16 per share in the prior-year quarter, which included $0.01 per share of loss from discontinued operations.

On average, 28 analysts polled by Thomson Reuters expected the company to report earnings of $0.21 per share for the quarter. Analysts' estimates typically exclude special items.

Revenues for the quarter declined to $1.27 billion from $1.36 billion in the same quarter last year, and missed twenty Wall Street analysts' consensus estimate of $1.30 billion.

Net interest income for the quarter decreased to $820 million from $832 million in the year-ago quarter, and net interest margin on a fully taxable equivalent or FTE basis, from continuing operations decreased to 3.17 percent from last year's 3.26 percent.

Non-interest income also declined to $448 million from $526 million in the prior-year quarter, driven primarily a decline in mortgage fees.

Non-interest expense for the quarter increased to $969 million from $946 million a year ago. Provision for loan losses for the quarter plummeted to $8 million from $79 million last year.

Regions Financial noted that it continues to generate sustainable long-term growth by focusing on the fundamentals of banking, meeting customer needs through service and innovation while maintaining a prudent and disciplined risk strategy.

RF closed Friday's regular trading session at $9.07, up $0.09 on a volume of 41.12 million shares.