REGIONS FINANCIAL CORP - FORM 8-K - EX-99.1

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8-K - 8-K - REGIONS FINANCIAL CORP	d259443d8k.htm
EX-99.2 - EX-99.2 - REGIONS FINANCIAL CORP	d259443dex992.htm
EX-99.3 - EX-99.3 - REGIONS FINANCIAL CORP	d259443dex993.htm

Exhibit 99.1

Regions Financial Corporation and Subsidiaries

Revised for Discontinued Operations

Condensed Statements of Operations (unaudited)

The following analyses have been prepared from Regions’ Financial Corporation’s historical consolidated financial results, revised to present the entities being sold as discontinued operations, net of tax. There are no pro forma adjustments to the historical information to reflect the transaction. The unaudited financial information should be read in conjunction with Regions’ Annual Report on Form 10-K for the year ended December 31, 2010 and unaudited consolidated financial statements included in Regions’ Quarterly Report on Form 10-Q for the three months ended September 30, 2011 as filed with the SEC. The information presented is condensed financial data, and does not represent a complete set of financial statements, with all disclosures required by U.S. GAAP and SEC regulations. The data is presented in order to provide historical information related to both continuing and discontinued operations.


	Quarter Ended
($ amounts in millions, except per share data)	9/30/11		6/30/11		3/31/11		12/31/10		9/30/10
Interest income		$ 1,055		$ 1,076		$ 1,090		$ 1,120		$ 1,147
Interest expense		205		220		235		257		288

Net interest income		850		856		855		863		859
Provision for loan losses		355		398		482		682		760

Net interest income after provision for loan losses		495		458		373		181		99
Non-interest income
Service charges on deposit accounts		310		308		287		290		294
Brokerage, investment banking and capital markets		(5)		19		31		33		5
Mortgage income		68		50		45		51		66
Trust department income		49		51		50		50		49
Securities gains (losses), net		(1)		24		82		333		2
Other		92		91		85		163		74

Total non-interest income		513		543		580		920		490

Non-interest expense
Salaries and employee benefits		383		401		428		411		409
Net occupancy expense		95		98		100		99		100
Furniture and equipment expense		70		72		70		68		69
Other		302		385		334		412		333

Total non-interest expense		850		956		932		990		911
Income (loss) before income taxes from continuing operations		158		45		21		111		(322)
Income tax expense (benefit) ⁽¹⁾		17		(34)		(29)		44		(157)

Income (loss) from continuing operations, net of tax		141		79		50		67		(165)
Income from discontinued operations, net of tax		14		30		19		22		10

Net income (loss)		$ 155		$ 109		$ 69		$ 89		$ (155)

Net income (loss) from continuing operations available to common shareholders		$ 87		$ 25		$ (2)		$ 14		$ (219)

Net income (loss) available to common shareholders		$ 101		$ 55		$ 17		$ 36		$ (209)

Weighted-average shares outstanding—during quarter:
Basic		1,259		1,258		1,257		1,257		1,257
Diluted		1,261		1,260		1,259		1,259		1,257

Income (loss) per common share from continuing operations:
Basic		$ 0.07		$ 0.02		$ 0.00		$ 0.01		$ (0.17)
Diluted		$ 0.07		$ 0.02		$ 0.00		$ 0.01		$ (0.17)

Income (loss) per common share from discontinued operations:
Basic		$ 0.01		$ 0.02		$ 0.01		$ 0.02		$ 0.01
Diluted		$ 0.01		$ 0.02		$ 0.01		$ 0.02		$ 0.01

Income (loss) per common share ⁽²⁾
Basic		$ 0.08		$ 0.04		$ 0.01		$ 0.03		$ (0.17)
Diluted		$ 0.08		$ 0.04		$ 0.01		$ 0.03		$ (0.17)

(1) In the second quarter of 2010, Regions recorded a $200 million charge to account for a probable, reasonably estimable loss related to a pending settlement of regulatory matters. At that time, Regions assumed that the entire charge would be non-deductible for income tax purposes. $75 million of the regulatory charge relates to continuing operations. The regulatory settlement was finalized in the second quarter of 2011. At the time of the settlement, Regions had better information related to the tax implications. Approximately $125 million of the $200 million settlement charge will be deductible for federal income tax purposes. Accordingly, during the second quarter of 2011, Regions adjusted federal income taxes to account for the impact of the deduction. The adjustment reduced total income tax expense by approximately $44 million for the second quarter of 2011, of which approximately $17 million relates to continuing operations.

(2) The per share amounts may not appear to reconcile due to rounding.

Regions Financial Corporation and Subsidiaries

Revised for Discontinued Operations

Condensed Statements of Operations (unaudited)

The following analyses have been prepared from Regions’ Financial Corporation’s historical consolidated financial results, revised to present the entities being sold as discontinued operations, net of tax. There are no pro forma adjustments to the historical information to reflect the transaction. The unaudited financial information should be read in conjunction with Regions’ Annual Report on Form 10-K for the year ended December 31, 2010 and unaudited consolidated financial statements included in Regions’ Quarterly Report on Form 10-Q for the nine months ended September 30, 2011 as filed with the SEC. The information presented is condensed financial data, and does not represent a complete set of financial statements, with all disclosures required by U.S. GAAP and SEC regulations. The data is presented in order to provide historical information related to both continuing and discontinued operations.


	Nine Months Ended				Year Ended
($ amounts in millions, except per share data)	9/30/11		9/30/10		12/31/10		12/31/09

Interest income	$	3,221	$	3,517	$	4,637	$	5,277
Interest expense		660		991		1,248		1,984

Net interest income		2,561		2,526		3,389		3,293
Provision for loan losses		1,235		2,181		2,863		3,541

Net interest income (loss) after provision for loan losses		1,326		345		526		(248)
Non-interest income
Service charges on deposit accounts		905		884		1,174		1,156
Brokerage, investment banking and capital markets		45		36		69		39
Mortgage income		163		196		247		259
Trust department income		150		146		196		191
Securities gains, net		105		61		394		69
Other		268		246		409		1,051

Total non-interest income		1,636		1,569		2,489		2,765
Non-interest expense
Salaries and employee benefits		1,212		1,229		1,640		1,635
Net occupancy expense		293		312		411		422
Furniture and equipment expense		212		209		277		281
Regulatory charge ⁽¹⁾		-		75		75		-
Other		1,021		1,045		1,456		1,447

Total non-interest expense		2,738		2,870		3,859		3,785

Income (loss) before income taxes from continuing operations		224		(956)		(844)		(1,268)
Income tax benefit ⁽²⁾		(46)		(419)		(376)		(194)

Income (loss) from continuing operations, net of tax		270		(537)		(468)		(1,074)
Income (loss) from discontinued operations, net of tax		63		(91)		(71)		43

Net income (loss)	$	333	$	(628)	$	(539)	$	(1,031)

Net income (loss) from continuing operations available to common shareholders	$	110	$	(708)	$	(692)	$	(1,304)

Net income (loss) available to common shareholders	$	173	$	(799)	$	(763)	$	(1,261)

Weighted-average shares outstanding:
Basic		1,258		1,217		1,227		989
Diluted		1,260		1,217		1,227		989

Income (loss) per common share from continuing operations:
Basic	$	0.09	$	(0.58)	$	(0.56)	$	(1.32)
Diluted	$	0.09	$	(0.58)	$	(0.56)	$	(1.32)

Income (loss) per common share from discontinued operations:
Basic	$	0.05	$	(0.08)	$	(0.06)	$	0.04
Diluted	$	0.05	$	(0.08)	$	(0.06)	$	0.04

Income (loss) per common share ⁽³⁾
Basic	$	0.14	$	(0.66)	$	(0.62)	$	(1.27)
Diluted	$	0.14	$	(0.66)	$	(0.62)	$	(1.27)

(2) The regulatory settlement referred to in (1) above was finalized in the second quarter of 2011. At the time of the settlement, Regions had better information related to the tax implications. Approximately $125 million of the $200 million settlement charge will be deductible for federal income tax purposes. Accordingly, during the second quarter of 2011, Regions adjusted federal income taxes to account for the impact of the deduction. The adjustment reduced total income tax expense by approximately $44 million for the second quarter of 2011, of which approximately $17 million relates to continuing operations.

(3) The per share amounts may not appear to reconcile due to rounding.

Regions Financial Corporation and Subsidiaries

Detail of Discontinued Operations

Condensed Statements of Operations (unaudited)

The following analyses provide detailed historical information for the entities being sold. There are no pro forma adjustments to the historical information to reflect the transaction. The unaudited financial information should be read in conjunction with Regions’ Annual Report on Form 10-K for the year ended December 31, 2010 and unaudited consolidated financial statements included in Regions’ Quarterly Report on Form 10-Q for the three and nine months ended September 30, 2011 as filed with the SEC. The information presented is condensed financial data, and does not represent a complete set of financial statements, with all disclosures required by U.S. GAAP and SEC regulations.


	Quarter Ended

($ amounts in millions)	9/30/11		6/30/11		3/31/11		12/31/10		9/30/10

Interest income		$ 9		$ 10		$ 10		$ 16		$ 11
Interest expense		1		2		2		2		2

Net interest income		8		8		8		14		9
Non-interest income
Brokerage, investment banking and capital markets		222		229		236		279		252
Other		10		9		27		14		8

Total non-interest income		232		238		263		293		260
Non-interest expense
Salaries and employee benefits		146		160		166		190		173
Net occupancy expense		9		9		9		9		10
Furniture and equipment expense		7		7		7		8		6
Other		54		66		53		69		63

Total non-interest expense		216		242		235		276		252
Income from discontinued operations before income taxes		24		4		36		31		17
Income tax expense (benefit) ⁽²⁾		10		(26)		17		9		7

Income from discontinued operations, net of tax		$ 14		$ 30		$ 19		$ 22		$ 10


	Nine Months Ended				Year Ended
($ amounts in millions)	9/30/11		9/30/10		12/31/10		12/31/09

Interest income		$ 29		$ 36		$ 52		$ 55
Interest expense		5		7		9		13

Net interest income		24		29		43		42
Non-interest income
Brokerage, investment banking and capital markets		687		711		990		950
Other		46		38		52		40

Total non-interest income		733		749		1,042		990
Non-interest expense
Salaries and employee benefits		472		488		678		634
Net occupancy expense		27		28		37		32
Furniture and equipment expense		21		19		27		30
Regulatory charge ⁽¹⁾		-		125		125		-
Other		173		189		259		270

Total non-interest expense		693		849		1,126		966

Income (loss) from discontinued operations before income taxes		64		(71)		(41)		66
Income tax expense (benefit) ⁽²⁾		1		20		30		23

Income (loss) from discontinued operations, net of tax		$ 63		$ (91)		$ (71)		$ 43

(2) The regulatory settlement referred to in (1) above was finalized in the second quarter of 2011. At the time of the settlement, Regions had better information related to the tax implications. Approximately $125 million of the $200 million settlement charge will be deductible for federal income tax purposes. Accordingly, during the second quarter of 2011, Regions adjusted federal income taxes to account for the impact of the deduction. The adjustment reduced income tax expense by approximately $44 million for the second quarter of 2011, of which approximately $27 million relates to discontinued operations.

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