In This Article:
Regions Financial Corporation’s RF first-quarter 2025 adjusted earnings per share of 54 cents beat the Zacks Consensus Estimate of 51 cents per share. This compares favorably with earnings of 44 cents per share in the year-ago quarter.
A decrease in non-interest expenses, an increase in non-interest income and net interest income (NII) supported RF’s results. Also, Regions Financial’s strong capital position indicates its availability of adequate capital to use to deal with any unexpected losses. A decline in provision for credit losses was an added advantage. However, a lower loan balance played spoilsport.
Net income (GAAP basis) available to common shareholders was $465 million, up 35.6% year over year.
Regions Financial’s Revenues Rise, Expenses Dip Y/Y
Total quarterly revenues were $1.78 billion, which missed the Zacks Consensus Estimate by 2.2%. The top line rose 2.1% from the year-ago quarter.
Quarterly NII was $1.19 billion, up 0.8% year over year. However, the net interest margin declined 3 basis points to 3.52%.
Non-interest income increased 4.8% year over year to $590 million.
Non-interest expenses fell 8.1% year over year to $1.04 billion. Adjusted non-interest expenses moved down 5.7% year over year to $1.03 billion.
The efficiency ratio was 57.9% in the first quarter compared with 64.3% in the prior-year quarter. A rise in this ratio indicates lower profitability.
RF’s Loans Decline, Deposit Balance Rises Sequentially
As of March 31, 2025, total loans decreased 0.3% on a sequential basis to $96.1 billion. Total deposits were $127.7 billion, which increased 0.9% from the previous quarter.
Regions Financial’s Credit Quality Improves
Non-performing assets (excluding more than 90 past due), as a percentage of loans, foreclosed properties and non-performing loans held for sale, decreased to 0.92% from the prior-year quarter’s 0.95%. Non-performing loans, excluding loans held for sale as a percentage of net loans, were 0.88%, down from 0.94% in the prior-year quarter.
A provision for credit losses of $124 million was recorded in the quarter, down 18.4% from the year-ago quarter.
Adjusted net charge-offs, as a percentage of average loans, were 0.52% compared with 0.50% in the prior-year period.
RF’s Capital Ratios Improve Y/Y
As of March 31, 2025, the Common Equity Tier 1 ratio and the Tier 1 capital ratio were 10.8% and 12.2%, respectively, compared with 10.3% and 11.6% in the year-earlier quarter.
Regions Financial’s Share Repurchase Update
In the reported quarter, the company repurchased 10.4 million shares for $242 million.