REGIONS FINANCIAL CORP - FORM 8-K - EX-99.2 - SUPPLEMENTAL FINANCIAL INFORMATION

Attached files

file	filename
8-K - FORM 8-K - REGIONS FINANCIAL CORP	d284494d8k.htm
EX-99.1 - PRESS RELEASE - REGIONS FINANCIAL CORP	d284494dex991.htm
EX-99.3 - VISUAL PRESENTATION - REGIONS FINANCIAL CORP	d284494dex993.htm

Exhibit 99.2

LOGO

Regions Financial Corporation and Subsidiaries

Financial Supplement

Fourth Quarter 2011

Regions Financial Corporation and Subsidiaries

Financial Supplement to Fourth Quarter 2011 Earnings Release

Table of Contents


		Page

Consolidated Balance Sheets		1

Consolidated Statements of Operations		2-3

Selected Ratios and Other Information from Continuing Operations		4

Consolidated Average Daily Balances and Yield / Rate Analysis from Continuing Operations		5-7

Loans and Deposits		8

Loan Portfolio Mix		9

Pre-Tax Pre-Provision Income (“PPI”) and Adjusted PPI from Continuing Operations		10

Non-Interest Income and Expense from Continuing Operations		11

Credit Quality
Allowance for Credit Losses, Net Charge-Offs and Related Ratios		12
Troubled Debt Restructurings, Business Services Criticized Loans		13
NPA and NPL Migration		14
Credit Costs		14
Early and late stage delinquencies		15
Non-Accrual Loans (excludes loans held for sale)		16
Residential Lending Net Charge-off Analysis		17

Investor Real Estate Analysis		18-19

Reconciliation to GAAP Financial Measures
Net Income and EPS		20
Fee Income Ratios, Efficiency Ratios and Adjusted Non-Interest Expense		21
Capital		22
Basel III		23

Statement of Operations-Discontinued Operations		24

Forward-Looking Statements		25


Regions Financial Corporation and Subsidiaries			Page 1
Financial Supplement to Fourth Quarter 2011 Earnings Release

Consolidated Balance Sheets (unaudited)


	Quarter Ended
($ amounts in millions)	12/31/11			9/30/11			6/30/11			3/31/11			12/31/10
Assets:
Cash and due from banks	$	2,132		$	2,000		$	2,271		$	2,042		$	1,643
Interest-bearing deposits in other banks		4,913			6,009			5,452			4,937			4,880
Federal funds sold and securities purchased under agreements to resell		200			254			251			341			396
Trading account assets		1,266			1,462			1,223			1,284			1,116
Securities available for sale		24,471			24,635			23,828			24,702			23,289
Securities held to maturity		16			18			21			22			24
Loans held for sale		1,193			1,012			1,141			1,552			1,485
Loans, net of unearned income		77,594			79,447			81,176			81,371			82,864
Allowance for loan losses		(2,745	)		(2,964	)		(3,120	)		(3,186	)		(3,185	)

Net loans		74,849			76,483			78,056			78,185			79,679
Other interest-earning assets		1,085			1,081			1,207			1,214			1,219
Premises and equipment, net		2,375			2,399			2,481			2,528			2,569
Interest receivable		361			422			354			441			421
Goodwill		4,816			5,561			5,561			5,561			5,561
Mortgage servicing rights (MSRs)		182			182			268			282			267
Other identifiable intangible assets		449			478			420			358			385
Other assets		8,742			7,766			8,374			8,307			9,417

Total Assets	$	127,050		$	129,762		$	130,908		$	131,756		$	132,351

Liabilities and Stockholders’ Equity:
Deposits:
Non-interest-bearing	$	28,266		$	28,296		$	28,148		$	27,480		$	25,733
Interest-bearing		67,361			67,642			68,183			68,889			68,881

Total deposits		95,627			95,938			96,331			96,369			94,614
Borrowed funds:
Short-term borrowings:
Federal funds purchased and securities sold under agreements to repurchase		2,333			1,969			1,740			2,218			2,716
Other short-term borrowings		734			974			982			964			1,221

Total short-term borrowings		3,067			2,943			2,722			3,182			3,937
Long-term borrowings		8,110			10,140			11,646			12,197			13,190

Total borrowed funds		11,177			13,083			14,368			15,379			17,127
Other liabilities		3,747			3,478			3,321			3,389			3,876

Total Liabilities		110,551			112,499			114,020			115,137			115,617

Stockholders’ equity:
Preferred stock, Series A		3,419			3,409			3,399			3,389			3,380
Common stock		13			13			13			13			13
Additional paid-in capital		19,060			19,059			19,052			19,047			19,050
Retained earnings (deficit)		(4,527	)		(3,913	)		(4,000	)		(4,043	)		(4,047	)
Treasury stock, at cost		(1,397	)		(1,397	)		(1,399	)		(1,400	)		(1,402	)
Accumulated other comprehensive income (loss), net		(69	)		92			(177	)		(387	)		(260	)

Total Stockholders’ Equity		16,499			17,263			16,888			16,619			16,734

Total Liabilities and Stockholders’ Equity	$	127,050		$	129,762		$	130,908		$	131,756		$	132,351


Regions Financial Corporation and Subsidiaries			Page 2
Financial Supplement to Fourth Quarter 2011 Earnings Release

Consolidated Statements of Operations (unaudited)


	Quarter Ended
($ amounts in millions, except per share data)	12/31/11			9/30/11			6/30/11			3/31/11			12/31/10
Interest income on:
Loans, including fees	$	854		$	867		$	856		$	867		$	911
Securities:
Taxable		166			177			208			207			193
Tax-exempt		—			—			—			—			—

Total securities		166			177			208			207			193
Loans held for sale		7			7			9			13			12
Trading account assets		1			—			—			—			—
Other interest-earning assets		3			4			3			3			4

Total interest income		1,031			1,055			1,076			1,090			1,120

Interest expense on:
Deposits		95			112			126			139			152
Short-term borrowings		(2	)		—			—			1			1
Long-term borrowings		89			93			94			95			104

Total interest expense		182			205			220			235			257

Net interest income		849			850			856			855			863

Provision for loan losses		295			355			398			482			682

Net interest income after provision for loan losses		554			495			458			373			181
Non-interest income:
Service charges on deposit accounts		263			310			308			287			290
Brokerage, investment banking and capital markets		19			(5	)		19			31			33
Mortgage income		57			68			50			45			51
Trust department income		49			49			51			50			50
Securities gains (losses), net		7			(1	)		24			82			333
Other		112			92			91			85			163

Total non-interest income		507			513			543			580			920

Non-interest expense:
Salaries and employee benefits		392			383			401			428			411
Net occupancy expense		95			95			98			100			99
Furniture and equipment expense		63			70			72			70			68
Goodwill impairment		253			—			—			—			—
Other		321			302			385			334			412

Total non-interest expense		1,124			850			956			932			990

Income (loss) before income taxes		(63	)		158			45			21			111
Income tax expense (benefit)		18			17			(34	)		(29	)		44

Income (loss) from continuing operations		(81	)		141			79			50			67

Discontinued operations:
Income (loss) from discontinued operations before income taxes		(472	)		24			4			36			31
Income tax expense (benefit)		(5	)		10			(26	)		17			9

Income (loss) from discontinued operations, net of tax		(467	)		14			30			19			22

Net income (loss)	$	(548	)	$	155		$	109		$	69		$	89

Income (loss) from continuing operations available to common shareholders ⁽¹⁾	$	(135	)	$	87		$	25		$	(2	)	$	14

Net income (loss) available to common shareholders ⁽¹⁾	$	(602	)	$	101		$	55		$	17		$	36

Weighted-average shares outstanding - during quarter:
Basic		1,259			1,259			1,258			1,257			1,257
Diluted		1,259			1,261			1,260			1,259			1,259
Actual shares outstanding - end of quarter		1,259			1,259			1,259			1,256			1,256

Earnings (loss) per common share from continuing operations (1):
Basic	$	(0.11	)	$	0.07		$	0.02		$	(0.00	)	$	0.01
Diluted	$	(0.11	)	$	0.07		$	0.02		$	(0.00	)	$	0.01

Earnings (loss) per common share ⁽¹⁾:
Basic	$	(0.48	)	$	0.08		$	0.04		$	0.01		$	0.03
Diluted	$	(0.48	)	$	0.08		$	0.04		$	0.01		$	0.03

Cash dividends declared per common share	$	0.01		$	0.01		$	0.01		$	0.01		$	0.01

Taxable-equivalent net interest income from continuing operations	$	857		$	859		$	864		$	864		$	873

(1)	Includes preferred stock dividends and accretion


Regions Financial Corporation and Subsidiaries			Page 3
Financial Supplement to Fourth Quarter 2011 Earnings Release

Consolidated Statements of Operations (unaudited)


	Year Ended December 31
($ amounts in millions, except per share data)	2011			2010
Interest income on:
Loans, including fees	$	3,444		$	3,705
Securities:
Taxable		758			873
Tax-exempt		—			1

Total securities		758			874
Loans held for sale		36			39
Trading account assets		1			4
Other interest-earning assets		13			15

Total interest income		4,252			4,637
Interest expense on:
Deposits		472			756
Short-term borrowings		(1	)		3
Long-term borrowings		371			489

Total interest expense		842			1,248

Net interest income		3,410			3,389
Provision for loan losses		1,530			2,863

Net interest income after provision for loan losses		1,880			526

Non-interest income:
Service charges on deposit accounts		1,168			1,174
Brokerage, investment banking and capital markets		64			69
Mortgage income		220			247
Trust department income		199			196
Securities gains, net		112			394
Other		380			409

Total non-interest income		2,143			2,489

Non-interest expense:
Salaries and employee benefits		1,604			1,640
Net occupancy expense		388			411
Furniture and equipment expense		275			277
Goodwill impairment		253			—
Regulatory charge		—			75
Other		1,342			1,456

Total non-interest expense		3,862			3,859

Income (loss) from continuing operations before income taxes		161			(844	)
Income tax benefit		(28	)		(376	)

Income (loss) from continuing operations		189			(468	)

Discontinued operations:
Loss from discontinued operations before income taxes		(408	)		(42	)
Income tax expense (benefit)		(4	)		29

Loss from discontinued operations, net of tax		(404	)		(71	)

Net income (loss)	$	(215	)	$	(539	)

Net income (loss) from continuing operations available to common shareholders ⁽¹⁾	$	(25	)	$	(692	)

Net income (loss) available to common shareholders ⁽¹⁾	$	(429	)	$	(763	)

Weighted-average shares outstanding - year-to-date:
Basic		1,258			1,227
Diluted		1,258			1,227
Actual shares outstanding - end of period		1,259			1,256

Earnings (loss) per common share from continuing operations ⁽¹⁾:
Basic	$	(0.02	)	$	(0.56	)
Diluted	$	(0.02	)	$	(0.56	)

Earnings (loss) per common share ⁽¹⁾:
Basic	$	(0.34	)	$	(0.62	)
Diluted	$	(0.34	)	$	(0.62	)

Cash dividends declared per common share	$	0.04		$	0.04

Taxable equivalent net interest income from continuing operations	$	3,446		$	3,421

(1)	Includes preferred stock dividends and accretion


Regions Financial Corporation and Subsidiaries			Page 4
Financial Supplement to Fourth Quarter 2011 Earnings Release

Selected Ratios and Other Information from Continuing Operations


	As of and for Quarter Ended
	12/31/11			9/30/11			6/30/11			3/31/11			12/31/10
Return on average assets from continuing operations		(0.43	)%		0.26	%		0.08	%		(0.01	)%		0.04	%

Return on average assets from continuing operations, excluding goodwill impairment and regulatory charge related tax benefit (non-GAAP)* ⁽³⁾		0.37	%		0.26	%		0.03	%		(0.01	)%		0.04	%

Return on average common equity from continuing operations*		(4.40	)%		2.83	%		0.86	%		(0.06	)%		0.48	%

Return on average tangible common equity from continuing operations (non-GAAP)* ⁽³⁾		(7.61	)%		4.98	%		1.45	%		(0.12	)%		0.77	%

Return on average tangible common equity from continuing operations, excluding goodwill impairment and regulatory charge related tax benefit (non-GAAP)* ⁽³⁾		6.66	%		4.98	%		0.47	%		(0.12	)%		0.77	%

Efficiency Ratio from continuing operations (non-GAAP) ⁽³⁾		64.6	%		61.8	%		63.6	%		68.3	%		68.0	%

Common equity per share	$	10.39		$	11.00		$	10.71		$	10.53		$	10.62

Tangible common book value per share (non-GAAP) ⁽³⁾	$	6.37		$	6.38		$	6.15		$	6.00		$	6.09

Stockholders’ equity to total assets		12.99	%		13.30	%		12.90	%		12.61	%		12.64	%

Tangible common stockholders’ equity to tangible assets (non-GAAP) ⁽³⁾		6.58	%		6.48	%		6.18	%		5.98	%		6.04	%

Tier 1 Common risk-based ratio (non-GAAP) ^{(1) (3)}		8.5	%		8.2	%		7.9	%		7.9	%		7.9	%

Tier 1 Capital ⁽¹⁾		13.2	%		12.8	%		12.6	%		12.5	%		12.4	%

Total Risk-Based Capital ⁽¹⁾		16.9	%		16.5	%		16.2	%		16.5	%		16.4	%

Leverage ⁽¹⁾		9.9	%		9.7	%		9.5	%		9.4	%		9.3	%

Allowance for credit losses as a percentage of loans, net of unearned income ⁽²⁾		3.64	%		3.84	%		3.95	%		4.01	%		3.93	%

Allowance for loan losses as a percentage of loans, net of unearned income		3.54	%		3.73	%		3.84	%		3.92	%		3.84	%

Allowance for loan losses to non-performing loans, excluding loans held for sale		1.16	x		1.09	x		1.12	x		1.03	x		1.01	x

Net interest margin (FTE)		3.08	%		3.04	%		3.07	%		3.09	%		3.01	%

Loans, net of unearned income, to total deposits		81.1	%		82.8	%		84.3	%		84.4	%		87.6	%

Net charge-offs as a percentage of average loans*		2.16	%		2.52	%		2.71	%		2.37	%		3.22	%

Non-accrual loans, excluding loans held for sale as a percentage of loans		3.06	%		3.41	%		3.43	%		3.79	%		3.81	%

Non-performing assets (excluding loans 90 days past due) as a percentage of loans, foreclosed properties and non-performing loans held for sale		3.83	%		4.23	%		4.39	%		4.78	%		4.69	%

Non-performing assets (including loans 90 days past due) as a percentage of loans, foreclosed properties and non-performing loans held for sale		4.40	%		4.75	%		4.98	%		5.42	%		5.38	%

Associate headcount		26,813			26,881			27,261			27,557			27,829

Total branch outlets		1,726			1,767			1,769			1,771			1,772

ATMs		2,083			2,130			2,132			2,144			2,148

*	Annualized

(1)	Current quarter Tier 1 Common, Tier 1, Total Risk-Based Capital and Leverage ratios are estimated

(2)	The allowance for credit losses reflects the allowance related to both loans on the balance sheet and exposure related to unfunded commitments and standby letters of credit

(3)	See reconciliation of GAAP to non-GAAP Financial Measures on pages 20-22.


Regions Financial Corporation and Subsidiaries			Page 5
Financial Supplement to Fourth Quarter 2011 Earnings Release

Consolidated Average Daily Balances and Yield/Rate Analysis from Continuing Operations


	Quarter Ended
	12/31/11									9/30/11
($ amounts in millions; yields on taxable-equivalent basis)	Average Balance			Income/ Expense			Yield/ Rate			Average Balance			Income/ Expense		Yield/ Rate
Assets
Interest-earning assets:
Federal funds sold and securities purchased under agreements to resell	$	—		$	—			—	%	$	—		$	—		—	%
Trading account assets		175			1			2.27			182			1		2.18
Securities:
Taxable		24,731			166			2.66			24,098			177		2.91
Tax-exempt		32			—			—			31			—		—
Loans held for sale		1,057			7			2.63			847			7		3.28
Loans, net of unearned income		78,702			863			4.35			80,513			875		4.31
Other interest-earning assets		5,690			4			0.28			6,544			4		0.24

Total interest-earning assets		110,387			1,041			3.74			112,215			1,064		3.76
Allowance for loan losses		(2,901	)								(3,150	)
Cash and due from banks		1,974									1,972
Other non-earning assets		15,440									15,549

	$	124,900								$	126,586

Liabilities and Stockholders’ Equity
Interest-bearing liabilities:
Savings accounts	$	5,153			1			0.08		$	5,148			1		0.08
Interest-bearing transaction accounts		18,602			7			0.15			16,651			7		0.17
Money market accounts		23,308			13			0.22			24,571			18		0.29
Time deposits		19,774			74			1.48			21,369			86		1.60

Total interest-bearing deposits ⁽¹⁾		66,837			95			0.56			67,739			112		0.66
Federal funds purchased and securities sold under agreements to repurchase		1,912			(2	)		(0.41	)		1,604			—		—
Other short-term borrowings		77			—			—			148			—		—
Long-term borrowings		9,630			90			3.71			10,786			93		3.42

Total interest-bearing liabilities		78,456			183			0.93			80,277			205		1.01

Net interest spread								2.82								2.75

Non-interest-bearing deposits ⁽¹⁾		28,318									28,408
Other liabilities		2,569									2,496
Stockholders’ equity		15,557									15,405

	$	124,900								$	126,586

Net interest income/margin FTE basis ⁽²⁾				$	858			3.08	%				$	859		3.04	%

(1)

Total deposit costs from continuing operations may be calculated by dividing total interest expense on deposits by the sum of interest-bearing deposits and non-interest bearing deposits. The rates for total deposit costs from continuing operations equal 0.40% and 0.46% for the quarters ended December 31, 2011 and September 30, 2011, respectively.

(2)	Including both continuing and discontinued operations, the net interest income and margin on a taxable equivalent basis is $865 million and 3.06%, respectively, for the quarter ended December 31, 2011.


Regions Financial Corporation and Subsidiaries			Page 6
Financial Supplement to Fourth Quarter 2011 Earnings Release

Consolidated Average Daily Balances and Yield/Rate Analysis from Continuing Operations


	Quarter Ended
	6/30/11								3/31/11								12/31/10
($ amounts in millions; yields on taxable-equivalent basis)	Average Balance			Income/ Expense		Yield/ Rate			Average Balance			Income/ Expense		Yield/ Rate			Average Balance			Income/ Expense		Yield/ Rate
Assets
Interest-earning assets:
Federal funds sold and securities purchased under agreements to resell	$	—		$	—		—	%	$	17		$	—		—	%	$	667		$	1		0.59	%
Trading account assets		164			1		2.45			143			1		2.84			140			1		2.83
Securities:
Taxable		24,765			208		3.37			24,755			207		3.39			23,876			193		3.21
Tax-exempt		33			—		—			30			—		—			47			—		—
Loans held for sale		1,141			9		3.16			1,486			13		3.55			1,486			12		3.20
Loans, net of unearned income		81,106			863		4.27			82,412			875		4.31			84,108			920		4.34
Other interest-earning assets		5,662			3		0.21			4,573			3		0.27			4,795			3		0.25

Total interest-earning assets		112,871			1,084		3.85			113,416			1,099		3.93			115,119			1,130		3.89
Allowance for loan losses		(3,200	)							(3,209	)							(3,164	)
Cash and due from banks		2,027								1,980								1,944
Other non-earning assets		15,740								15,800								16,074

	$	127,438							$	127,987							$	129,973

Liabilities and Stockholders’ Equity
Interest-bearing liabilities:
Savings accounts	$	5,107			1		0.08		$	4,837			1		0.08		$	4,622			1		0.09
Interest-bearing transaction accounts		13,898			7		0.20			13,228			7		0.21			12,690			6		0.19
Money market accounts		26,805			20		0.30			27,815			21		0.31			28,273			23		0.32
Time deposits		22,507			98		1.75			22,971			110		1.94			23,369			122		2.07

Total interest-bearing deposits ⁽¹⁾		68,317			126		0.74			68,851			139		0.82			68,954			152		0.87
Federal funds purchased and securities sold under agreements to repurchase		1,752			1		0.23			1,937			1		0.21			2,902			—		—
Other short-term borrowings		122			—		—			401			—		—			396			—		—
Long-term borrowings		11,726			93		3.18			12,857			95		3.00			13,967			105		2.98

Total interest-bearing liabilities		81,917			220		1.08			84,046			235		1.13			86,219			257		1.18

Net interest spread							2.77								2.80								2.71

Non-interest-bearing deposits ⁽¹⁾		27,806								26,405								25,688
Other liabilities		2,455								2,362								2,508
Stockholders’ equity		15,260								15,174								15,558

	$	127,438							$	127,987							$	129,973

Net interest income/margin FTE basis				$	864		3.07	%				$	864		3.09	%				$	873		3.01	%

(1)

Total deposit costs from continuing operations may be calculated by dividing total interest expense on deposits by the sum of interest-bearing deposits and non-interest bearing deposits. The rates for total deposit costs from continuing operations equal 0.53%, 0.59% and 0.64% for the quarters ended June 30, 2011, March 31, 2011 and December 31, 2010, respectively.


Regions Financial Corporation and Subsidiaries			Page 7
Financial Supplement to Fourth Quarter 2011 Earnings Release

Consolidated Average Daily Balances and Yield/Rate Analysis from Continuing Operations


	Year Ended December 31
	2011									2010
($ amounts in millions; yields on taxable-equivalent basis)	Average Balance			Income/ Expense			Yield/ Rate			Average Balance			Income/ Expense		Yield/ Rate
Assets
Interest-earning assets:
Federal funds sold and securities purchased under agreements to resell	$	4		$	—			—	%	$	377		$	2		0.53	%
Trading account assets		166			4			2.41			175			7		4.00
Securities:
Taxable		24,586			758			3.08			23,851			873		3.66
Tax-exempt		31			—			—			44			1		2.27
Loans held for sale		1,131			35			3.09			1,281			39		3.04
Loans, net of unearned income		80,673			3,477			4.31			86,660			3,734		4.31
Other earning assets		5,623			13			0.23			5,119			13		0.25

Total interest-earning assets		112,214			4,287			3.82			117,507			4,669		3.97
Allowance for loan losses		(3,114	)								(3,187	)
Cash and due from banks		1,988									2,021
Other non-earning assets		15,631									16,379

	$	126,719								$	132,720

Liabilities and Stockholders’ Equity
Interest-bearing liabilities:
Savings accounts	$	5,062			5			0.10		$	4,459			4		0.09
Interest-bearing transaction accounts		15,613			27			0.17			14,404			32		0.22
Money market accounts		25,609			73			0.29			27,354			117		0.43
Time deposits		21,646			367			1.70			26,290			602		2.29

Total interest-bearing deposits ⁽¹⁾		67,930			472			0.69			72,507			755		1.04
Federal funds purchased and securities sold under agree-ments to repurchase		1,801			(1	)		(0.06	)		1,983			3		0.15
Other short-term borrowings		186			—			—			331			1		0.30
Long-term borrowings		11,240			371			3.30			15,489			489		3.16

Total interest-bearing liabilities		81,157			842			1.04			90,310			1,248		1.38

Net interest spread								2.78								2.59

Non-interest bearing deposits ⁽¹⁾		27,741									23,982
Other liabilities		2,471									2,512
Stockholders’ equity		15,350									15,916

	$	126,719								$	132,720

Net interest income/margin FTE basis ⁽²⁾				$	3,445			3.07	%				$	3,421		2.91	%

(1)

Total deposit costs from continuing operations may be calculated by dividing total interest expense on deposits by the sum of interest-bearing deposits and non-interest bearing deposits. The rates for total deposit costs from continuing operations equal 0.49% and 0.78% for the twelve months ended December 31, 2011 and 2010, respectively.

(2)	Including both continuing and discontinued operations, the net interest income and margin on a taxable equivalent basis is $3,476 million and 3.05%, respectively, for the year ended December 31, 2011.


Regions Financial Corporation and Subsidiaries			Page 8
Financial Supplement to Fourth Quarter 2011 Earnings Release

Loans


	Quarter Ended
($ amounts in millions)	12/31/11		9/30/11		6/30/11		3/31/11		12/31/10		12/31/11 vs. 9/30/11					12/31/11 vs. 12/31/10
Commercial and industrial	$	24,522	$	24,273	$	23,644	$	23,149	$	22,540	$	249		1.0	%	$	1,982		8.8	%
Commercial real estate mortgage - owner-occupied		11,166		11,537		11,797		11,889		12,046		(371	)	-3.2	%		(880	)	-7.3	%
Commercial real estate construction - owner-occupied		337		356		377		430		470		(19	)	-5.3	%		(133	)	-28.3	%

Total commercial		36,025		36,166		35,818		35,468		35,056		(141	)	-0.4	%		969		2.8	%

Commercial investor real estate mortgage		9,702		10,696		11,836		12,932		13,621		(994	)	-9.3	%		(3,919	)	-28.8	%
Commercial investor real estate construction		1,025		1,188		1,595		1,895		2,287		(163	)	-13.7	%		(1,262	)	-55.2	%

Total investor real estate		10,727		11,884		13,431		14,827		15,908		(1,157	)	-9.7	%		(5,181	)	-32.6	%

Residential first mortgage		13,784		14,083		14,306		14,404		14,898		(299	)	-2.1	%		(1,114	)	-7.5	%
Home equity - first lien		5,884		5,954		6,011		6,100		6,213		(70	)	-1.2	%		(329	)	-5.3	%
Home equity - second lien		7,137		7,362		7,582		7,774		8,013		(225	)	-3.1	%		(876	)	-10.9	%
Indirect		1,848		1,774		1,704		1,626		1,592		74		4.2	%		256		16.1	%
Consumer credit card		987		1,024		1,134		—		—		(37	)	-3.6	%		987		NM
Other consumer		1,202		1,200		1,190		1,172		1,184		2		0.2	%		18		1.5	%

Total Loans	$	77,594	$	79,447	$	81,176	$	81,371	$	82,864	$	(1,853	)	-2.3	%	$	(5,270	)	-6.4	%


	Average Balances
($ amounts in millions)	4Q11		3Q11		2Q11		1Q11		4Q10		4Q11 vs. 3Q11					4Q11 vs. 4Q10
Commercial and industrial	$	24,310	$	23,953	$	23,506	$	22,889	$	21,956	$	357		1.5	%	$	2,354		10.7	%
Commercial real estate mortgage - owner-occupied		11,404		11,661		11,826		12,012		11,944		(257	)	-2.2	%		(540	)	-4.5	%
Commercial real estate construction - owner-occupied		346		375		404		438		503		(29	)	-7.7	%		(157	)	-31.2	%

Total commercial		36,060		35,989		35,736		35,339		34,403		71		0.2	%		1,657		4.8	%

Commercial investor real estate mortgage		10,357		11,395		12,607		13,393		14,223		(1,038	)	-9.1	%		(3,866	)	-27.2	%
Commercial investor real estate construction		1,152		1,411		1,805		2,100		2,649		(259	)	-18.4	%		(1,497	)	-56.5	%

Total investor real estate		11,509		12,806		14,412		15,493		16,872		(1,297	)	-10.1	%		(5,363	)	-31.8	%

Residential first mortgage		13,925		14,207		14,329		14,692		15,620		(282	)	-2.0	%		(1,695	)	-10.9	%
Home equity - first lien		5,927		6,003		6,066		6,162		6,262		(76	)	-1.3	%		(335	)	-5.3	%
Home equity - second lien		7,245		7,451		7,678		7,891		8,127		(206	)	-2.8	%		(882	)	-10.9	%
Indirect		1,825		1,755		1,681		1,628		1,606		70		4.0	%		219		13.6	%
Consumer credit card		1,002		1,095		13		—		—		(93	)	-8.5	%		1,002		NM
Other consumer		1,209		1,207		1,191		1,207		1,218		2		0.2	%		(9	)	-0.7	%

Total Loans	$	78,702	$	80,513	$	81,106	$	82,412	$	84,108	$	(1,811	)	-2.2	%	$	(5,406	)	-6.4	%


Deposits

	Quarter Ended
($ amounts in millions)	12/31/11		9/30/11		6/30/11		3/31/11		12/31/10		12/31/11 vs. 9/30/11					12/31/11 vs. 12/31/10
Customer Deposits
Interest-free deposits	$	28,266	$	28,296	$	28,148	$	27,480	$	25,733	$	(30	)	-0.1	%	$	2,533		9.8	%
Interest-bearing checking		19,388		18,317		15,982		13,365		13,423		1,071		5.8	%		5,965		44.4	%
Savings		5,159		5,155		5,118		5,064		4,668		4		0.1	%		491		10.5	%
Money market - domestic		23,053		23,284		24,650		27,261		27,420		(231	)	-1.0	%		(4,367	)	-15.9	%
Money market - foreign		378		423		476		533		569		(45	)	-10.6	%		(191	)	-33.6	%

Low-cost deposits		76,244		75,475		74,374		73,703		71,813		769		1.0	%		4,431		6.2	%
Time deposits		19,378		20,455		21,947		22,656		22,784		(1,077	)	-5.3	%		(3,406	)	-14.9	%

Total customer deposits		95,622		95,930		96,321		96,359		94,597		(308	)	-0.3	%		1,025		1.1	%

Corporate Treasury Deposits
Time deposits		5		8		10		10		17		(3	)	-37.5	%		(12	)	-70.6	%

Total Deposits	$	95,627	$	95,938	$	96,331	$	96,369	$	94,614	$	(311	)	-0.3	%	$	1,013		1.1	%


	Average Balances
($ amounts in millions)	4Q11		3Q11		2Q11		1Q11		4Q10		4Q11 vs. 3Q11					4Q11 vs. 4Q10
Customer Deposits
Interest-free deposits	$	28,318	$	28,408	$	27,806	$	26,405	$	25,688	$	(90	)	-0.3	%	$	2,630		10.2	%
Interest-bearing checking		18,602		16,651		13,898		13,228		12,690		1,951		11.7	%		5,912		46.6	%
Savings		5,153		5,148		5,107		4,837		4,622		5		0.1	%		531		11.5	%
Money market - domestic		22,951		24,098		26,302		27,276		27,767		(1,147	)	-4.8	%		(4,816	)	-17.3	%
Money market - foreign		357		473		503		540		506		(116	)	-24.5	%		(149	)	-29.4	%

Low-cost deposits		75,381		74,778		73,616		72,286		71,273		603		0.8	%		4,108		5.8	%
Time deposits		19,767		21,359		22,496		22,956		23,347		(1,592	)	-7.5	%		(3,580	)	-15.3	%

Total customer deposits		95,148		96,137		96,112		95,242		94,620		(989	)	-1.0	%		528		0.6	%

Corporate Treasury Deposits
Time deposits		7		10		10		15		22		(3	)	-30.0	%		(15	)	-68.2	%

Total Deposits	$	95,155	$	96,147	$	96,122	$	95,257	$	94,642	$	(992	)	-1.0	%	$	513		0.5	%


Regions Financial Corporation and Subsidiaries			Page 9
Financial Supplement to Fourth Quarter 2011 Earnings Release

Loan Portfolio Mix

LOGO

Loan Portfolio Balances by Percentage


	Quarter Ended
	12/31/11			9/30/11			6/30/11			3/31/11			12/31/10
Commercial and industrial		31.6	%		30.6	%		29.1	%		28.5	%		27.2	%
Commercial real estate mortgage - OO		14.4	%		14.5	%		14.5	%		14.6	%		14.5	%
Commercial real estate construction - OO		0.4	%		0.4	%		0.5	%		0.5	%		0.6	%

Total commercial		46.4	%		45.5	%		44.1	%		43.6	%		42.3	%

Commercial investor real estate mortgage		12.5	%		13.5	%		14.6	%		15.9	%		16.4	%
Commercial investor real estate construction		1.3	%		1.5	%		2.0	%		2.3	%		2.8	%

Total investor real estate		13.8	%		15.0	%		16.6	%		18.2	%		19.2	%

Residential first mortgage		17.8	%		17.7	%		17.6	%		17.7	%		18.0	%
Home equity		16.8	%		16.8	%		16.7	%		17.1	%		17.2	%
Indirect		2.4	%		2.2	%		2.1	%		2.0	%		1.9	%
Consumer credit card		1.3	%		1.3	%		1.4	%		0.0	%		0.0	%
Other consumer		1.5	%		1.5	%		1.5	%		1.4	%		1.4	%

Total Loans		100.0	%		100.0	%		100.0	%		100.0	%		100.0	%

OO = Owner Occupied


Regions Financial Corporation and Subsidiaries			Page 10
Financial Supplement to Fourth Quarter 2011 Earnings Release

Pre-Tax Pre-Provision Income from Continuing Operations (non-GAAP)


	Quarter Ended
($ amounts in millions)	12/31/11			9/30/11		6/30/11			3/31/11			12/31/10			4Q11 vs. 3Q11					4Q11 vs. 4Q10
Income (loss) from continuing operations available to common shareholders (GAAP)	$	(135	)	$	87	$	25		$	(2	)	$	14		$	(222	)	-255.2	%	$	(149	)	-1064.3	%
Preferred dividends (GAAP)		54			54		54			52			53			—		—			1		1.9	%
Income tax expense (benefit) (GAAP)		18			17		(34	)		(29	)		44			1		5.9	%		(26	)	-59.1	%

Income (loss) from continuing operations before income taxes (GAAP)		(63	)		158		45			21			111			(221	)	-139.9	%		(174	)	-156.8	%
Provision for loan losses (GAAP)		295			355		398			482			682			(60	)	-16.9	%		(387	)	-56.7	%

Pre-tax pre-provision income from continuing operations (non-GAAP)		232			513		443			503			793			(281	)	-54.8	%		(561	)	-70.7	%
Goodwill impairment		253			—		—			—			—			253		NM			253		NM

Pre-tax pre-provision income from continuing operations, excluding goodwill impairment (non-GAAP)		485			513		443			503			793			(28	)	-5.5	%		(308	)	-38.8	%


Other Adjustments:
Securities (gains) losses, net		(7	)		1		(24	)		(82	)		(333	)		(8	)	-800.0	%		326		97.9	%
Loss (gain) on sale of mortgage loans		—			—		—			3			(26	)		—		—			26		-100.0	%
Leveraged lease termination (gains) losses, net ⁽¹⁾		(10	)		2		—			—			(59	)		(12	)	-600.0	%		49		83.1	%
Loss on early extinguishment of debt		—			—		—			—			55			—		—			(55	)	-100.0	%
Securities impairment, net		2			—		—			—			—			2		NM			2		NM
Branch consolidation and equipment costs		(2	)		—		77			—			—			(2	)	NM			(2	)	NM

Total other adjustments		(17	)		3		53			(79	)		(363	)		(20	)	-666.7	%		346		95.3	%

Adjusted Pre-tax Pre-provision Income from continuing operations (non-GAAP)	$	468		$	516	$	496		$	424		$	430		$	(48	)	-9.3	%	$	38		8.8	%

The Pre-Tax Pre-Provision Income from Continuing Operations table above presents computations of pre-tax pre-provision income from continuing operations excluding certain adjustments (non-GAAP). Regions believes that the exclusion of these adjustments provides a meaningful base for period-to-period comparisons, which management believes will assist investors in analyzing the operating results of the Company and predicting future performance. These non-GAAP financial measures are also used by management to assess the performance of Regions’ business. It is possible that the activities related to the adjustments may recur; however, management does not consider the activities related to the adjustments to be indications of ongoing operations. Regions believes that presentation of these non-GAAP financial measures will permit investors to assess the performance of the Company on the same basis as that applied by management. Non-GAAP financial measures have inherent limitations, are not required to be uniformly applied and are not audited. Although these non-GAAP financial measures are frequently used by stakeholders in the evaluation of a company, they have limitations as analytical tools, and should not be considered in isolation, or as a substitute for analyses of results as reported under GAAP. In particular, a measure of income that excludes certain adjustments does not represent the amount that effectively accrues directly to stockholders.

(1)	After tax amounts for leveraged lease terminations gains are $2.8 million for 12/31/11, $5.4 million for 9/30/11 and $3.2 million for 12/31/10.


Regions Financial Corporation and Subsidiaries			Page 11
Financial Supplement to Fourth Quarter 2011 Earnings Release

Non-Interest Income and Expense from Continuing Operations

Non-Interest Income from continuing operations


	Quarter Ended
($ amounts in millions)	12/31/11			9/30/11			6/30/11			3/31/11			12/31/10			4Q11 vs. 3Q11					4Q11 vs. 4Q10
Service charges on deposit accounts	$	263		$	310		$	308		$	287		$	290		$	(47	)	-15.2	%	$	(27	)	-9.3	%
Brokerage, investment banking and capital markets income		19			(5	)		19			31			33			24		-480.0	%		(14	)	-42.4	%
Mortgage income		57			68			50			45			51			(11	)	-16.2	%		6		11.8	%
Trust department income		49			49			51			50			50			—		—			(1	)	-2.0	%
Commercial credit income		20			20			20			20			21			—		—			(1	)	-4.8	%
Securities gains (losses), net		7			(1	)		24			82			333			8		800.0	%		(326	)	-97.9	%
Insurance income		26			27			25			28			25			(1	)	-3.7	%		1		4.0	%
Leveraged lease termination gains (losses), net		10			(2	)		—			—			59			12		600.0	%		(49	)	-83.1	%
Bank-owned life insurance		24			18			20			21			26			6		33.3	%		(2	)	-7.7	%
Net revenue (loss) from affordable housing		(20	)		(18	)		(17	)		(14	)		(24	)		(2	)	11.1	%		4		16.7	%
Other		52			47			43			30			56			5		10.6	%		(4	)	-7.1	%

Total non-interest income from continuing operations	$	507		$	513		$	543		$	580		$	920		$	(6	)	-1.2	%	$	(413	)	-44.9	%


Non-Interest Expense from continuing operations

	Quarter Ended
($ amounts in millions)	12/31/11			9/30/11			6/30/11			3/31/11			12/31/10			4Q11 vs. 3Q11					4Q11 vs. 4Q10
Salaries and employee benefits	$	392		$	383		$	401		$	428		$	411		$	9		2.3	%	$	(19	)	-4.6	%
Net occupancy expense		95			95			98			100			99			—		—			(4	)	-4.0	%
Furniture and equipment expense		63			70			72			70			68			(7	)	-10.0	%		(5	)	-7.4	%
Professional and legal fees		40			42			38			55			55			(2	)	-4.8	%		(15	)	-27.3	%
Amortization of core deposit intangible		23			23			24			25			26			—		—			(3	)	-11.5	%
Other real estate owned expense		38			48			37			39			61			(10	)	-20.8	%		(23	)	-37.7	%
FDIC premiums		46			47			72			52			52			(1	)	-2.1	%		(6	)	-11.5	%
Branch consolidation and property and equipment charges		(2	)		—			77			—			—			(2	)	NM			(2	)	NM
Loss on early extinguishment of debt		—			—			—			—			55			—		—			(55	)	-100.0	%
Other		176			142			137			163			163			34		23.9	%		13		8.0	%

Total non-interest expense from continuing operations before goodwill impairment (non-GAAP)		871			850			956			932			990		$	21		2.5	%	$	(119	)	-12.0	%
Goodwill impairment		253			—			—			—			—			253		NM			253		NM

Total non-interest expense from continuing operations	$	1,124		$	850		$	956		$	932		$	990		$	274		32.2	%	$	134		13.5	%

•

Non-interest income decreased $6 million linked quarter to $507 million. Included in the 4Q11 amount were $10 million in leveraged lease termination gains and $7 million in securities gains. The leveraged lease termination gain was offset by $7 million in increased tax expense, resulting in a nominal impact to net income.

•

Service charges decreased $47 million linked quarter, as the Durbin Amendment rules took effect October 1st. This reduction was in line with expectations and was partially offset by ongoing actions, including restructuring certain deposit accounts from free to fee-eligible, re-entry into the credit card business and the NOW banking product suite launch.

•

Brokerage, investment banking and capital markets income increased $24 million to $19 million reflecting increased capital markets revenue and deferred compensation adjustments which are offset by increases in salaries and benefits.

•

Mortgage income decreased $11 million linked quarter, reflecting an $8 million reduced benefit from mortgage servicing rights and related hedging activities. Mortgage origination volume in the fourth quarter totaled $1.8 billion, bringing full year production to $6.3 billion.

•

Non-interest expenses increased $274 million linked quarter due to the $253 million goodwill impairment charge included from continuing operations. Excluding goodwill impairment, non-interest expenses increased 2 percent linked quarter, which includes a $16 million expense related to Visa class B shares litigation.

•

Salaries and benefits expense increased 2% linked quarter, due to deferred compensation valuation adjustments as mentioned above.

•

Other real estate owned expense decreased $10 million linked quarter to $38 million, reflecting a decline in valuation adjustments.


Regions Financial Corporation and Subsidiaries			Page 12
Financial Supplement to Fourth Quarter 2011 Earnings Release

Credit Quality


	As of and for Quarter Ended
($ amounts in millions)	12/31/11			9/30/11			6/30/11			3/31/11			12/31/10
Allowance for credit losses (ACL)	$	2,823		$	3,050		$	3,204		$	3,264		$	3,256
Allowance allocated to purchased loans ⁽¹⁾		—			84			84			—			—
Provision for loan losses		295			355			398			482			682
Provision (credit) for unfunded credit losses		(8	)		2			6			7			—

Net loans charged-off:
Commercial and industrial		65			72			49			72			128
Commercial real estate mortgage - owner-occupied		63			62			43			66			80
Commercial real estate construction - owner-occupied		1			2			1			4			4

Total commercial		129			136			93			142			212
Commercial investor real estate mortgage		112			167			247			132			202
Commercial investor real estate construction		39			52			56			42			99

Total investor real estate		151			219			303			174			301
Residential first mortgage		47			59			55			56			56
Home equity - first lien		16			19			17			22			20
Home equity - second lien		56			60			66			72			72
Indirect		4			2			3			4			4
Consumer credit card		12			1			—			—			—
Other consumer		15			15			11			11			17

Total	$	430		$	511		$	548		$	481		$	682


Net loan charge-offs as a % of average loans, annualized:
Commercial and industrial		1.06	%		1.19	%		0.85	%		1.27	%		2.31	%
Commercial real estate mortgage - owner-occupied		2.18	%		2.13	%		1.45	%		2.23	%		2.64	%
Commercial real estate construction - owner-occupied		0.82	%		2.01	%		1.08	%		3.74	%		3.54	%

Total commercial		1.41	%		1.50	%		1.05	%		1.63	%		2.44	%
Commercial investor real estate mortgage		4.28	%		5.81	%		7.85	%		4.00	%		5.63	%
Commercial investor real estate construction		13.61	%		14.45	%		12.56	%		8.07	%		14.91	%

Total investor real estate		5.21	%		6.76	%		8.44	%		4.56	%		7.09	%
Residential first mortgage		1.34	%		1.64	%		1.54	%		1.55	%		1.42	%
Home equity - first lien		1.11	%		1.26	%		1.11	%		1.47	%		1.26	%
Home equity - second lien		3.06	%		3.21	%		3.46	%		3.68	%		3.52	%
Indirect		0.78	%		0.64	%		0.57	%		1.05	%		1.09	%
Consumer credit card		4.62	%		0.42	%		—			—			—
Other consumer		4.92	%		4.93	%		3.70	%		3.70	%		5.54	%

Total		2.16	%		2.52	%		2.71	%		2.37	%		3.22	%


Non-accrual loans, excluding loans held for sale	$	2,372		$	2,710		$	2,784		$	3,087		$	3,160
Non-performing loans held for sale		328			344			381			381			304

Non-accrual loans, including loans held for sale	$	2,700		$	3,054		$	3,165		$	3,468		$	3,464
Foreclosed properties		296			337			437			465			454

Non-performing assets (NPAs)	$	2,996		$	3,391		$	3,602		$	3,933		$	3,918

Loans past due > 90 days	$	447		$	412		$	483		$	527		$	585

Restructured loans not included in categories above ⁽²⁾	$	2,850		$	2,817		$	1,664		$	1,553		$	1,483

Credit Ratios:
ACL/Loans, net		3.64	%		3.84	%		3.95	%		4.01	%		3.93	%
ALL/Loans, net		3.54	%		3.73	%		3.84	%		3.92	%		3.84	%
Allowance for loan losses to non-performing loans, excluding loans held for sale		1.16	x		1.09	x		1.12	x		1.03	x		1.01	x
Non-accrual loans, excluding loans held for sale/Loans		3.06	%		3.41	%		3.43	%		3.79	%		3.81	%
NPAs (ex. 90+ past due)/Loans, foreclosed properties and non-performing loans held for sale		3.83	%		4.23	%		4.39	%		4.78	%		4.69	%
NPAs (inc. 90+ past due)/Loans, foreclosed properties and non- performing loans held for sale		4.40	%		4.75	%		4.98	%		5.42	%		5.38	%

Allowance for Credit Losses


	Year Ended December 31
($ amounts in millions)	2011			2010
Balance at beginning of year	$	3,256		$	3,188
Net loans charged off		(1,970	)		(2,792	)
Provision for loan losses		1,530			2,863
Provision for unfunded credit commitments		7			(3	)

Balance at end of year	$	2,823		$	3,256

Components:
Allowance for loan losses	$	2,745		$	3,185
Reserve for unfunded credit commitments		78			71

Allowance for credit losses	$	2,823		$	3,256

(1)

During the second quarter of 2011, Regions purchased a credit card portfolio for approximately $1.1 billion and recorded an allowance for loan losses and related premium of approximately $84 million. Upon finalization of the purchase price in the fourth quarter of 2011, Regions reclassified the $84 million allowance and premium. The impact of these reclassification entries was not material to the financial results in any of the quarters of 2011.

(2)	See page 13 for detail of restructured loans.


Regions Financial Corporation and Subsidiaries			Page 13
Financial Supplement to Fourth Quarter 2011 Earnings Release

Troubled Debt Restructurings


	Quarter Ended
(in millions)	12/31/11		9/30/11		6/30/11		3/31/11		12/31/10
Current:
Commercial	$	452	$	437	$	62	$	66	$	70
Investor Real Estate		967		923		257		193		152
Residential First Mortgage		767		774		760		737		696
Home Equity		377		373		352		328		305
Other Consumer		50		54		58		59		59

Total Current	$	2,613	$	2,561	$	1,489	$	1,383	$	1,282


Accruing 30-89 DPD:
Commercial	$	40	$	39	$	7	$	6	$	7
Investor Real Estate		28		67		16		15		40
Residential First Mortgage		133		114		116		117		117
Home Equity		30		30		31		27		30
Other Consumer		6		6		5		5		7

Total Accruing 30-89 DPD	$	237	$	256	$	175	$	170	$	201


Non-accrual or 90+ DPD:
Commercial	$	353	$	373	$	164	$	120	$	105
Investor Real Estate		473		475		200		230		198
Residential First Mortgage		210		214		207		221		240
Home Equity		33		30		29		28		30
Other Consumer		—		1		—		1		—

Total Non-accrual or 90+DPD	$	1,069	$	1,093	$	600	$	600	$	573


Total TDRs	$	3,919	$	3,910	$	2,264	$	2,153	$	2,056

Business Services Criticized Loan Summary

The tables below present a summary of Business Services loans by risk rating category and by portfolio segment.


	Quarter Ended 12/31/11
(in millions)	Special Mention		Substandard Accrual		Non-Accrual		Total
Commercial
TDRs	$	57	$	409	$	351	$	817
All Other Commercial (not TDRs)		711		776		721		2,208

	$	768	$	1,185	$	1,072	$	3,025


Investor Real Estate
TDRs	$	131	$	757	$	472	$	1,360
All Other Investor Real Estate (not TDRs)		738		805		442		1,985

	$	869	$	1,562	$	914	$	3,345

Note: As of December 31, 2011 there were $27 million accruing Commercial TDRs that were “Pass” rated and $108 million accruing Investor Real Estate TDRs that were “Pass” rated, that are not illustrated in the table above.


	Quarter Ended 9/30/11
	Special Mention		Substandard Accrual		Non-Accrual		Total
Commercial
TDRs	$	58	$	404	$	371	$	833
All Other Commercial (not TDRs)		696		788		822		2,306

	$	754	$	1,192	$	1,193	$	3,139


Investor Real Estate
TDRs	$	55	$	869	$	474	$	1,398
All Other Investor Real Estate (not TDRs)		1,088		1,029		651		2,768

	$	1,143	$	1,898	$	1,125	$	4,166

Note: As of September 30, 2011 there were $16 million accruing Commercial TDRs that were “Pass” rated and $67 million accruing Investor Real Estate TDRs that were “Pass” rated, that are not illustrated in the table above.


Regions Financial Corporation and Subsidiaries			Page 14
Financial Supplement to Fourth Quarter 2011 Earnings Release

Gross and Net NPA Migration


	Quarter Ended
($ in millions)	12/31/11			9/30/11			6/30/11			3/31/11			12/31/10
Beginning Non-Performing Assets ⁽¹⁾	$	3,391		$	3,602		$	3,933		$	3,918		$	4,226
Additions	$	621		$	822		$	619		$	816		$	1,021
Resolutions ⁽²⁾		(362	)		(260	)		(224	)		(214	)		(348	)
Charge-Offs / OREO Write-Downs		(348	)		(384	)		(362	)		(368	)		(576	)
Home Equity Reclassification⁽³⁾		—			56			—			—			—

Net Additions (Reductions)	$	(89	)	$	234		$	33		$	234		$	97

Non-Accrual Asset Sales		(185	)		(299	)		(226	)		(106	)		(309	)
OREO Sales		(121	)		(146	)		(138	)		(113	)		(96	)

Ending Non-Performing Assets ⁽¹⁾	$	2,996		$	3,391		$	3,602		$	3,933		$	3,918

⁽¹⁾

Includes Loans Held for Sale

⁽²⁾

Includes payments and returned to accruals

⁽³⁾

Beginning in 3Q11, credit policy on home equity lines and loans in second lien position changed such that they are placed on non-accrual by the end of the month in which the loan becomes 120 days past due. Prior policy required all real estate secured loans to be placed on non-accrual by the end of the month in which the loan becomes 180 days past due unless the loan is fully secured and in process of collection. The effect of the reclassification was to increase non-accrual loans and to decrease 90 days past due loans.

Gross NPL Migration


	Quarter Ended
($ in millions)	12/31/11			9/30/11			6/30/11			3/31/11		12/31/10
Land/Single Family/Condo Investor Real Estate	$	58		$	189		$	73		$	93	$	262
Income Producing IRE		199			273			134			224		270

Total Investor Real Estate		257			462			207			317		532
Commercial		140			161			207			197		209
Business and Community		165			144			158			185		176
Consumer		(1	)		(12	)		(17	)		31		31

Total Gross NPL Migration	$	561		$	755		$	555		$	730	$	948

Credit Costs


	Quarter Ended
(in millions)	12/31/11			9/30/11			6/30/11			3/31/11		12/31/10
Net Charge-offs
Investor Real Estate (IRE)	$	54		$	60		$	99		$	84	$	205
Commercial		87			100			91			126		197
Consumer Real Estate		117			134			138			150		148
Other Consumer		31			19			13			15		21

Net Charge-offs excluding charge-offs from Sales / Transfers to HFS	$	289		$	313		$	341		$	375	$	571


Sales/Transfer to HFS		141			198			207			106		111

Total Net Charge-offs	$	430		$	511		$	548		$	481	$	682


Net Loss / (Gain) - HFS Sales	$	(12	)	$	(2	)	$	(1	)	$	—	$	(7	)
HFS Write-downs ⁽⁴⁾		7			2			5			2		21
OREO expense		39			48			37			39		61

Total Credit Costs before Reserve Change	$	464		$	559		$	589		$	522	$	757


Loan Loss Reserve Increase / (Reduction)		(134	)		(156	)		(150	)		1		—

Total Credit Costs after Reserve Change	$	330		$	403		$	439		$	523	$	757

⁽⁴⁾

Reflects write-downs subsequent to initial move to held for sale and write-downs upon transfer to OREO


Regions Financial Corporation and Subsidiaries			Page 15
Financial Supplement to Fourth Quarter 2011 Earnings Release

Early and Late Stage Delinquencies

30-89 Days Past Due Loans


	Quarter Ended
($ millions)	12/31/11				9/30/11				6/30/11				3/31/11				12/31/10
Commercial and Industrial	$	61	0.25	%	$	87	0.36	%	$	118	0.50	%	$	104	0.45	%	$	103	0.45	%
Commercial Real Estate Mortgage - OO		70	0.63	%		87	0.76	%		71	0.60	%		99	0.83	%		101	0.84	%
Commercial Real Estate Construction - OO		4	1.12	%		1	0.20	%		2	0.56	%		2	0.44	%		3	0.61	%

Total Commercial	$	135	0.37	%	$	175	0.48	%	$	191	0.53	%	$	205	0.58	%	$	207	0.59	%

Commercial Investor Real Estate Mortgage	$	76	0.78	%	$	126	1.18	%	$	146	1.23	%	$	332	2.57	%	$	211	1.55	%
Commercial Investor Real Estate Construction		28	2.76	%		17	1.42	%		25	1.57	%		35	1.86	%		42	1.83	%

Total Investor Real Estate	$	104	0.97	%	$	143	1.21	%	$	171	1.27	%	$	367	2.48	%	$	253	1.59	%

Residential First Mortgage	$	287	2.08	%	$	269	1.91	%	$	265	1.85	%	$	277	1.92	%	$	303	2.03	%
Home Equity		198	1.52	%		180	1.36	%		168	1.23	%		185	1.33	%		224	1.58	%
Direct		13	1.56	%		12	1.44	%		12	1.39	%		11	1.27	%		16	1.97	%
Indirect		33	1.80	%		30	1.66	%		25	1.44	%		27	1.69	%		37	2.30	%
Consumer Credit Card		14	1.39	%		14	1.40	%		11	1.00	%		—	0.00	%		—	0.00	%
Other Consumer		12	3.45	%		12	3.46	%		10	3.10	%		9	2.57	%		12	3.33	%

Total Consumer	$	557	1.81	%	$	517	1.65	%	$	491	1.54	%	$	509	1.64	%	$	592	1.86	%


Total 30-89 Days Past Due Loans	$	796	1.03	%	$	835	1.05	%	$	853	1.05	%	$	1,081	1.33	%	$	1,052	1.27	%

90+ Days Past Due Loans


	Quarter Ended
($ millions)	12/31/11				9/30/11				6/30/11				3/31/11				12/31/10
Commercial & Industrial	$	28	0.11	%	$	10	0.04	%	$	7	0.03	%	$	10	0.04	%	$	9	0.04	%
Commercial Real Estate Mortgage - OO		9	0.08	%		6	0.05	%		11	0.09	%		8	0.07	%		6	0.05	%
Commercial Real Estate Construction - OO		—	0.00	%		—	0.00	%		—	0.05	%		—	0.09	%		1	0.12	%

Total Commercial	$	37	0.10	%	$	16	0.04	%	$	18	0.05	%	$	18	0.05	%	$	16	0.05	%

Commercial Investor Real Estate Mortgage	$	13	0.13	%	$	9	0.08	%	$	5	0.04	%	$	13	0.10	%	$	5	0.04	%
Commercial Investor Real Estate Construction		—	0.01	%		—	0.01	%		—	0.02	%		1	0.04	%		1	0.04	%

Total Investor Real Estate	$	13	0.12	%	$	9	0.07	%	$	5	0.04	%	$	14	0.09	%	$	6	0.04	%

Residential First Mortgage	$	284	2.06	%	$	291	2.06	%	$	296	2.07	%	$	315	2.18	%	$	359	2.41	%
Home Equity ⁽¹⁾		93	0.71	%		81	0.61	%		158	1.16	%		174	1.26	%		198	1.39	%
Direct		2	0.23	%		2	0.19	%		1	0.16	%		1	0.13	%		1	0.13	%
Indirect		2	0.13	%		1	0.08	%		2	0.10	%		2	0.13	%		2	0.13	%
Consumer Credit Card		13	1.38	%		10	1.03	%		—	0.00	%		—	0.00	%		—	0.00	%
Other Consumer		3	0.75	%		2	0.50	%		3	0.79	%		3	0.86	%		3	0.88	%

Total Consumer	$	397	1.29	%	$	387	1.23	%	$	460	1.44	%	$	495	1.59	%	$	563	1.76	%


Total 90+ Days Past Due Loans	$	447	0.58	%	$	412	0.52	%	$	483	0.60	%	$	527	0.65	%	$	585	0.71	%

OO =	Owner Occupied

(1)	Refer to page 14 for the home equity reclassification which increased non-accrual loans and decreased 90 days past due loans in 3Q11.


Regions Financial Corporation and Subsidiaries			Page 16
Financial Supplement to Fourth Quarter 2011 Earnings Release

Non-Accrual Loans (excludes loans held for sale)


	Quarter Ended
($ millions)	12/31/11				9/30/11				6/30/11				3/31/11				12/31/10
Commercial and Industrial	$	457	1.86	%	$	498	2.05	%	$	525	2.22	%	$	446	1.93	%	$	467	2.07	%
Commercial Real Estate Mortgage - OO		590	5.29	%		668	5.79	%		687	5.82	%		648	5.45	%		606	5.03	%
Commercial Real Estate Construction - OO		25	7.36	%		27	7.68	%		28	7.57	%		31	7.20	%		29	6.19	%

Total Commercial	$	1,072	2.98	%	$	1,193	3.30	%	$	1,240	3.46	%	$	1,125	3.17	%	$	1,102	3.14	%

Commercial Investor Real Estate Mortgage	$	734	7.56	%	$	829	7.75	%	$	820	6.93	%	$	1,142	8.83	%	$	1,265	9.28	%
Commercial Investor Real Estate Construction		180	17.61	%		296	24.93	%		371	23.25	%		448	23.64	%		452	19.76	%

Total Investor Real Estate	$	914	8.52	%	$	1,125	9.46	%	$	1,191	8.87	%	$	1,590	10.73	%	$	1,717	10.79	%

Residential First Mortgage		250	1.81	%		261	1.85	%		288	2.01	%		303	2.10	%		285	1.92	%
Home Equity ⁽¹⁾		136	1.04	%		131	0.98	%		65	0.48	%		69	0.50	%		56	0.40	%
Direct		—	0.00	%		—	0.00	%		—	0.00	%		—	0.00	%		—	0.00	%
Indirect		—	0.00	%		—	0.00	%		—	0.00	%		—	0.00	%		—	0.00	%
Consumer Credit Card		—	0.00	%		—	0.00	%		—	0.00	%		—	0.00	%		—	0.00	%
Other Consumer		—	0.00	%		—	0.00	%		—	0.00	%		—	0.00	%		—	0.00	%

Total Consumer	$	386	1.25	%	$	392	1.25	%	$	353	1.11	%	$	372	1.20	%	$	341	1.07	%


Total Non-Accrual Loans	$	2,372	3.06	%	$	2,710	3.41	%	$	2,784	3.43	%	$	3,087	3.79	%	$	3,160	3.81	%

OO = Owner

Occupied

(1)	Refer to page 14 for the home equity reclassification which increased non-accrual loans and decreased 90 days past due loans in 3Q11.

Business Services Credit Quality - Criticized Loans

LOGO


Regions Financial Corporation and Subsidiaries			Page 17
Financial Supplement to Fourth Quarter 2011 Earnings Release

Residential Lending Net Charge-off Analysis


		Quarter Ended
		12/31/2011															9/30/2011
		First Liens									Junior Liens						First Liens									Junior Liens
($ in millions)		Residential Mortgage			Home Equity			Total			Home Equity			Total			Residential Mortgage			Home Equity			Total			Home Equity			Total
Florida	Net Charge-off %*		2.20	%		1.59	%		2.03	%		5.37	%		2.97	%		2.94	%		2.13	%		2.72	%		5.59	%		3.53	%
	$ Losses	$	29.2		$	7.9		$	37.2		$	38.3		$	75.5		$	39.8		$	10.8		$	50.6		$	41.0		$	91.6
	Balance	$	5,237.4		$	1,972.7		$	7,210.0		$	2,786.1		$	9,996.1		$	5,324.3		$	1,987.2		$	7,311.5		$	2,877.9		$	10,189.4
	Original LTV		72.0	%		65.6	%					75.9	%					71.7	%		65.5	%					75.9	%


All Other States	Net Charge-off %*		0.82	%		0.87	%		0.83	%		1.57	%		1.02	%		0.84	%		0.83	%		0.84	%		1.68	%		1.06	%
	$ Losses	$	17.8		$	8.7		$	26.4		$	17.5		$	43.9		$	18.8		$	8.3		$	27.1		$	19.3		$	46.4
	Balance	$	8,546.4		$	3,911.5		$	12,457.9		$	4,350.4		$	16,808.3		$	8,758.5		$	3,966.6		$	12,725.1		$	4,484.8		$	17,209.9
	Original LTV		74.1	%		66.6	%					79.3	%					74.0	%		66.7	%					79.3	%


Totals	Net Charge-off %*		1.34	%		1.11	%		1.27	%		3.06	%		1.75	%		1.64	%		1.26	%		1.53	%		3.21	%		1.98	%
	$ Losses	$	47.0		$	16.6		$	63.6		$	55.8		$	119.4		$	58.6		$	19.1		$	77.7		$	60.3		$	138.0
	Balance	$	13,783.7		$	5,884.2		$	19,667.9		$	7,136.5		$	26,804.5		$	14,082.8		$	5,953.8		$	20,036.6		$	7,362.7		$	27,399.3
	Original LTV		73.3	%		66.3	%					77.9	%					73.2	%		66.3	%					77.9	%

•

21% Florida junior lien concentration driving results

•

Junior lien, Florida net charge-offs represent 53% of 4Q11 Home Equity net charge-offs but just 21% of Home Equity outstanding balances.

•

Net Home Equity charge-offs in Florida approximately 3 times non-Florida net charge-off rate

•

New Home Equity origination quality solid with an average FICO of 776 and an average LTV of 61%; Property value declines driving losses

LOGO


Notes:		* Recoveries are pro-rated based on charge-off balances.
		* Balances shown on an ending basis. Net loss rates calculated using average balances
		* Original LTVs shown for current period only; prior period LTVs not materially different


Regions Financial Corporation and Subsidiaries			Page 18
Financial Supplement to Fourth Quarter 2011 Earnings Release

Investor Real Estate Analysis

LOGO


Regions Financial Corporation and Subsidiaries			Page 19
Financial Supplement to Fourth Quarter 2011 Earnings Release

Investor Real Estate Analysis

LOGO


Regions Financial Corporation and Subsidiaries			Page 20
Financial Supplement to Fourth Quarter 2011 Earnings Release

Reconciliation to GAAP Financial Measures

Net Income (Loss) and Earnings (Loss) Per Share

The table below presents computations of earnings (loss) and certain other financial measures, excluding goodwill impairment and regulatory charge and related tax benefit (non-GAAP). The goodwill impairment charge and the regulatory charge and related tax benefit are included in financial results presented in accordance with generally accepted accounting principles (GAAP). Regions believes that the exclusion of the goodwill impairment and the regulatory charge and related tax benefit in expressing earnings (loss) and certain other financial measures, including “earnings (loss) per common share, excluding goodwill impairment and regulatory charge and related tax benefit”, “return on average assets, excluding goodwill impairment and regulatory charge and related tax benefit” and “return on average tangible common stockholders’ equity, excluding goodwill impairment and regulatory charge and related tax benefit” (explained on next page) provides a meaningful base for period-to-period comparisons, which management believes will assist investors in analyzing the operating results of the Company and predicting future performance. These non-GAAP financial measures are also used by management to assess the performance of Regions’ business because management does not consider the goodwill impairment and regulatory charge and related tax benefit to be relevant to ongoing operating results. Management and the Board of Directors utilize these non-GAAP financial measures for the following purposes: preparation of Regions’ operating budgets; monthly financial performance reporting; monthly close-out “flash” reporting of consolidated results (management only); and presentations to investors of company performance. Regions believes that presenting these non-GAAP financial measures will permit investors to assess the performance of the Company on the same basis as that applied by management and the Board of Directors. Non-GAAP financial measures have inherent limitations, are not required to be uniformly applied and are not audited. To mitigate these limitations, Regions has policies and procedures in place to identify and address expenses that qualify for non-GAAP presentation, including authorization and system controls to ensure accurate period to period comparisons. Although these non-GAAP financial measures are frequently used by stakeholders in the evaluation of a company, they have limitations as analytical tools, and should not be considered in isolation, or as a substitute for analyses of results as reported under GAAP. In particular, a measure of earnings that excludes the goodwill impairment charge and the regulatory charge and related tax benefit does not represent the amount that effectively accrues directly to stockholders (i.e. the goodwill impairment charge and the regulatory charge are reductions in earnings and stockholders’ equity).


		Year Ended December 31						As of and for Quarter Ended
($ amounts in millions, except per share data)		2011			2010			12/31/11			9/30/11			6/30/11			03/31/11			12/31/10
Net income (loss) (GAAP)		$	(215	)	$	(539	)	$	(548	)	$	155		$	109		$	69		$	89
Preferred dividends and accretion (GAAP)			(214	)		(224	)		(54	)		(54	)		(54	)		(52	)		(53	)


Net income (loss) available to common shareholders (GAAP)	A	$	(429	)	$	(763	)	$	(602	)	$	101		$	55		$	17		$	36

Income (loss) from discontinued operations, net of tax (GAAP) ⁽¹⁾			(404	)		(71	)		(467	)		14			30			19			22

Income (loss) from continuing operations available to common shareholders (GAAP)	B		(25	)		(692	)		(135	)		87			25			(2	)		14


Goodwill impairment from continuing operations (non-deductible)			253			—			253			—			—			—			—
Regulatory charge and related tax benefit from continuing operations ⁽²⁾			(17	)		75			—			—			(17	)		—			—


Income (loss) from continuing operations available to common shareholders, excluding goodwill impairment and regulatory charge and related tax benefit (non-GAAP)	C	$	211		$	(617	)	$	118		$	87		$	8		$	(2	)	$	14


Weighted-average diluted shares	D		1,258			1,227			1,259			1,261			1,260			1,259			1,259

Earnings (loss) per common share - diluted (GAAP)	A/D	$	(0.34	)	$	(0.62	)	$	(0.48	)	$	0.08		$	0.04		$	0.01		$	0.03

Earnings (loss) per common share from continuing operations - diluted (GAAP)	B/D	$	(0.02	)	$	(0.56	)	$	(0.11	)	$	0.07		$	0.02		$	(0.00	)	$	0.01

Earnings (loss) per common share from continuing operations, excluding goodwill impairment and regulatory charge and related tax benefit - diluted (non-GAAP)	C/D	$	0.17		$	(0.50	)	$	0.09		$	0.07		$	0.01		$	(0.00	)	$	0.01

(1)	There are no preferred shares allocable to discontinued operations.

(2)

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 settlement was finalized during the second quarter of 2011. At the time of settlement, Regions had better information related to tax implications. Approximately $125 million of the 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 Regions’ provision for income taxes by approximately $44 million for the second quarter of 2011, of which approximately $17 million relates to continuing operations.


Regions Financial Corporation and Subsidiaries			Page 21
Financial Supplement to Fourth Quarter 2011 Earnings Release

Reconciliation to GAAP Financial Measures - Continuing Operations

Fee Income Ratios and Efficiency Ratios

The tables below present computations of the efficiency ratio (non-GAAP), which is a measure of productivity, generally calculated as non-interest expense divided by total revenue. The table also shows the fee ratio (non-GAAP), generally calculated as non-interest income divided by total revenue. Management uses these ratios to monitor performance and believes this measure provides meaningful information to investors. Non-interest expense (GAAP) is presented excluding certain adjustments to arrive at adjusted non-interest expense (non-GAAP), which is the numerator for the efficiency ratio. Non-interest income (GAAP) is presented excluding certain adjustments to arrive at adjusted non-interest income (non-GAAP), which is the numerator for the fee ratio. Net interest income on a fully taxable-equivalent basis (GAAP) and non-interest income are added together to arrive at total revenue (GAAP). Adjustments are made to arrive at adjusted total revenue (non-GAAP), which is the denominator for the fee and efficiency ratios. Regions believes that the exclusion of these adjustments provides a meaningful base for period-to-period comparisons, which management believes will assist investors in analyzing the operating results of the Company and predicting future performance. These non-GAAP financial measures are also used by management to assess the performance of Regions’ business. It is possible that the activities related to the adjustments may recur; however, management does not consider the activities related to the adjustments to be indications of ongoing operations. Regions believes that presentation of these non-GAAP financial measures will permit investors to assess the performance of the Company on the same basis as that applied by management.


		As of and for Quarter Ended
($ amounts in millions)		12/31/11			9/30/11			6/30/11			3/31/11			12/31/10
Continuing Operations
Non-interest expense (GAAP)		$	1,124		$	850		$	956		$	932		$	990
Adjustments:
Loss on early extinguishment of debt			—			—			—			—			(55	)
Securities impairment, net			(2	)		—			—			—			—
Branch consolidation and property and equipment charges			2			—			(77	)		—			—
Goodwill impairment			(253	)		—			—			—			—

Adjusted non-interest expense (non-GAAP)	E	$	871		$	850		$	879		$	932		$	935


Net interest income, taxable-equivalent basis (GAAP)		$	858		$	859		$	864		$	864		$	873

Non-interest income (GAAP)		$	507		$	513		$	543		$	580		$	920
Adjustments:
Securities (gains) losses, net			(7	)		1			(24	)		(82	)		(333	)
Leveraged lease termination (gains) losses, net			(10	)		2			—			—			(59	)
Loss (gain) on sale of mortgage loans			—			—			—			3			(26	)

Adjusted non-interest income (non-GAAP)	F		490			516			519			501			502

Adjusted total revenue (non-GAAP)	G	$	1,348		$	1,375		$	1,383		$	1,365		$	1,375


Fee income ratio (non-GAAP)	F/G		36.4	%		37.5	%		37.5	%		36.7	%		36.5	%
Efficiency ratio (non-GAAP)	E/G		64.6	%		61.8	%		63.6	%		68.3	%		68.0	%

Adjusted Non-Interest Expense

The table below presents computations of full year adjusted non-interest expense for 2011 and 2010 (non-GAAP). Management uses these measures to monitor performance and believes these measures provide meaningful information to investors. Non-interest expense (GAAP) is presented excluding certain adjustments to arrive at adjusted non-interest expense (non-GAAP). Regions believes that the exclusion of these adjustments provides a meaningful base for period-to-period comparisons, which management believes will assist investors in analyzing the operating results of the Company and predicting future performance. These non-GAAP financial measures are also used by management to assess the performance of Regions’ business. It is possible that the activities related to the adjustments may recur; however, management does not consider the activities related to the adjustments to be indications of ongoing operations. Regions believes that presentation of these non-GAAP financial measures will permit investors to assess the performance of the Company on the same basis as that applied by management.


	Year Ended
	December 31				2011 vs. 2010
Continuing Operations	2011		2010		$ Change			% Change
Non-interest expense (GAAP)	$	3,862	$	3,859	$	3			0.1	%
Adjustments:
Goodwill impairment		253		—		253			NM
Regulatory charge		—		75		(75	)		NM

Adjusted non-interest expense (non-GAAP)	$	3,609	$	3,784	$	(175	)		-4.6	%


Regions Financial Corporation and Subsidiaries			Page 22
Financial Supplement to Fourth Quarter 2011 Earnings Release

Reconciliation to GAAP Financial Measures

Return Ratios, Tangible Common Ratios, Capital

The following tables provide calculations of “return on average tangible common stockholders’ equity”, end of period “tangible common stockholders’ equity” ratios and a reconciliation of stockholders’ equity (GAAP) to tangible common stockholders’ equity (non-GAAP) and Tier 1 capital (regulatory) and to “Tier 1 common equity” (non-GAAP). Tangible common stockholders’ equity ratios have become a focus of some investors and management believes they may assist investors in analyzing the capital position of the Company absent the effects of intangible assets and preferred stock. Traditionally, the Federal Reserve and other banking regulatory bodies have assessed a bank’s capital adequacy based on Tier 1 capital, the calculation of which is codified in federal banking regulations. In connection with the Company’s Comprehensive Capital Assessment and Review (“CCAR”), these regulators are supplementing their assessment of the capital adequacy of a bank based on a variation of Tier 1 capital, known as Tier 1 common equity. While not codified, analysts and banking regulators have assessed Regions’ capital adequacy using the tangible common stockholders’ equity and/or the Tier 1 common equity measure. Because tangible common stockholders’ and Tier 1 common equity are not formally defined by GAAP or codified in the federal banking regulations, these measures are considered to be non-GAAP financial measures and other entities may calculate them differently than Regions’ disclosed calculations. Since analysts and banking regulators may assess Regions’ capital adequacy using tangible common stockholders’ equity and Tier 1 common equity, we believe that it is useful to provide investors the ability to assess Regions’ capital adequacy on these same bases.

Tier 1 common equity is often expressed as a percentage of risk-weighted assets. Under the risk-based capital framework, a company’s balance sheet assets and credit equivalent amounts of off-balance sheet items are assigned to one of four broad risk categories. The aggregated dollar amount in each category is then multiplied by the risk-weighted category. The resulting weighted values from each of the four categories are added together and this sum is the risk-weighted assets total that, as adjusted, comprises the denominator of certain risk-based capital ratios. Tier 1 capital is then divided by this denominator (risk-weighted assets) to determine the Tier 1 capital ratio. Adjustments are made to Tier 1 capital to arrive at Tier 1 common equity. Tier 1 common equity is also divided by the risk-weighted assets to determine the Tier 1 common equity ratio. The amounts disclosed as risk-weighted assets are calculated consistent with banking regulatory requirements.


		As of and for Quarter Ended
($ amounts in millions, except per share data)		12/31/11			9/30/11			6/30/11			3/31/11			12/31/10
RETURN ON AVERAGE ASSETS FROM CONTINUING OPERATIONS
Average assets (GAAP) - continuing operations	H	$	124,900		$	126,586		$	127,438		$	127,987		$	129,973
Return on average assets from continuing operations (GAAP) ⁽¹⁾	B/H		(0.43	%)		0.26	%		0.08	%		(0.01	%)		0.04	%

Return on average assets from continuing operations, excluding goodwill impairment and regulatory charge related tax benefit (non-GAAP) ⁽¹⁾	C/H		0.37	%		0.26	%		0.03	%		(0.01	%)		0.04	%


RETURN ON AVERAGE TANGIBLE COMMON STOCKHOLDERS’ EQUITY
Average stockholders’ equity (GAAP) - continuing operations		$	15,557		$	15,405		$	15,260		$	15,174		$	15,558
Less: Average intangible assets (GAAP) - continuing operations			5,320			5,292			5,203			5,229			5,254
Average deferred tax liability related to intangibles (GAAP)			(210	)		(224	)		(230	)		(237	)		(243	)
Average preferred equity (GAAP) - continuing operations			3,413			3,402			3,392			3,383			3,374

Average tangible common stockholders’ equity (non-GAAP)	I	$	7,034		$	6,935		$	6,895		$	6,799		$	7,173
Return on average tangible common stockholders’ equity from continuing operations (GAAP) ⁽¹⁾	B/I		(7.61	%)		4.98	%		1.45	%		(0.12	%)		0.77	%


Return on average tangible common stockholders’ equity from continuing operations, excluding regulatory charge related tax benefit (non-GAAP) ⁽¹⁾	C/I		6.66	%		4.98	%		0.47	%		(0.12	%)		0.77	%


TANGIBLE COMMON RATIOS - CONSOLIDATED
Stockholders’ equity (GAAP)		$	16,499		$	17,263		$	16,888		$	16,619		$	16,734
Less: Preferred equity (GAAP)			3,419			3,409			3,399			3,389			3,380
Intangible assets (GAAP)			5,265			6,039			5,981			5,919			5,946
Deferred tax liability related to intangibles (GAAP)			(200	)		(220	)		(227	)		(233	)		(240	)

Tangible common stockholders’ equity (non-GAAP)	J	$	8,015		$	8,035		$	7,735		$	7,544		$	7,648
Total assets (GAAP)		$	127,050		$	129,762		$	130,908		$	131,756		$	132,351
Less: Intangible assets (GAAP)			5,265			6,039			5,981			5,919			5,946
Deferred tax liability related to intangibles (GAAP)			(200	)		(220	)		(227	)		(233	)		(240	)

Tangible assets (non-GAAP)	K	$	121,985		$	123,943		$	125,154		$	126,070		$	126,645
Shares outstanding - end of quarter	L		1,259			1,259			1,259			1,256			1,256
Tangible common stockholders’ equity to tangible assets (non-GAAP)	J/K		6.58	%		6.48	%		6.18	%		5.98	%		6.04	%
Tangible common book value per share (non-GAAP)	J/L	$	6.37		$	6.38		$	6.15		$	6.00		$	6.09

TIER 1 COMMON RISK-BASED RATIO ⁽²⁾- CONSOLIDATED
Stockholders’ equity (GAAP)		$	16,499		$	17,263		$	16,888		$	16,619		$	16,734
Accumulated other comprehensive (income) loss			69			(92	)		177			387			260
Non-qualifying goodwill and intangibles			(4,900	)		(5,649	)		(5,668	)		(5,686	)		(5,706	)
Disallowed deferred tax assets			(432	)		(506	)		(498	)		(463	)		(424	)
Disallowed servicing assets			(35	)		(35	)		(35	)		(28	)		(27	)
Qualifying non-controlling interests			92			92			92			92			92
Qualifying trust preferred securities			846			846			846			846			846

Tier 1 capital (regulatory)		$	12,139		$	11,919		$	11,802		$	11,767		$	11,775
Qualifying non-controlling interests			(92	)		(92	)		(92	)		(92	)		(92	)
Qualifying trust preferred securities			(846	)		(846	)		(846	)		(846	)		(846	)
Preferred stock			(3,419	)		(3,409	)		(3,399	)		(3,389	)		(3,380	)

Tier 1 common equity (non-GAAP)	M	$	7,782		$	7,572		$	7,465		$	7,440		$	7,457
Risk-weighted assets (regulatory)	N		91,663			92,786			93,865			93,929			94,966
Tier 1 common risk-based ratio (non-GAAP)	O		8.5	%		8.2	%		7.9	%		7.9	%		7.9	%

(1)	Annualized

(2)	Current quarter amount and the resulting ratio is estimated


Regions Financial Corporation and Subsidiaries			Page 23
Financial Supplement to Fourth Quarter 2011 Earnings Release

Reconciliation to GAAP Financial Measures

Basel III

The following tables provide calculations of Tier 1 capital and Tier 1 common, based on Regions’ current understanding of Basel III requirements. Regions currently calculates its risk-based capital ratios under guidelines adopted by the Federal Reserve based on the 1988 Capital Accord (“Basel I”) of the Basel Committee on Banking Supervision (the “Basel Committee”). In December 2010, the Basel Committee released its final framework for Basel III, which will strengthen international capital and liquidity regulation. When implemented by U.S. bank regulatory agencies and fully phased-in, Basel III will change capital requirements and place greater emphasis on common equity. Implementation of Basel III will begin on January 1, 2013, and will be phased in over a multi-year period. The U.S. bank regulatory agencies have not yet finalized regulations governing the implementation of Basel III. Accordingly, the calculations provided below are estimates, based on Regions’ current understanding of the framework, including the Company’s reading of the requirements, and informal feedback received through the regulatory process. Regions’ understanding of the framework is evolving and will likely change as the regulations are finalized. Because the Basel III implementation regulations are not formally defined by GAAP and have not yet been finalized and codified, these measures are considered to be non-GAAP financial measures, and other entities may calculate them differently from Regions’ disclosed calculations. Since analysts and banking regulators may assess Regions’ capital adequacy using the Basel III framework, we believe that it is useful to provide investors the ability to assess Regions’ capital adequacy on the same basis.


($ amounts in millions)	12/31/11

Stockholders’ equity (GAAP)	$	16,499
Non-qualifying goodwill and intangibles ⁽¹⁾		(5,065	)
Adjustments, including other comprehensive income related to cash flow hedges, disallowed deferred tax assets, threshold deductions and other adjustments		(857	)

	$	10,577

Qualifying non-controlling interests		4

Basel III Tier 1 Capital (non-GAAP)	$	10,581

Basel III Tier 1 Capital (non-GAAP)	$	10,581

Preferred Stock		(3,419	)
Qualifying non-controlling interests		(4	)

Basel III Tier 1 Common (non-GAAP)	$	7,158


Basel I risk-weighted assets		91,663
Basel III risk-weighted assets ⁽²⁾		93,267


			Minimum
Basel III Tier 1 Capital Ratio	11.3	%		8.5	%
Basel III Tier 1 Common Ratio	7.7	%		7.0	%

(1)	Under Basel III, regulatory capital must be reduced by purchased credit card relationship intangible assets. These assets are partially allowed in Basel I capital.

(2)	Regions continues to develop systems and internal controls to precisely calculate risk-weighted assets as required by Basel III. The amount included above is a reasonable approximation, based on our understanding of the requirements.


Regions Financial Corporation and Subsidiaries			Page 24
Financial Supplement to Fourth Quarter 2011 Earnings Release

Statements of Discontinued Operations (unaudited)

On January 11, 2012, Regions entered into a stock purchase agreement to sell Morgan Keegan and Company, Inc. and related affiliates to Raymond James Financial, Inc. for approximately $930 million. As part of the transaction, Morgan Keegan will also pay Regions a dividend of $250 million before closing, pending regulatory approval, resulting in total proceeds of $1.18 billion to Regions, subject to adjustments based on the aggregate amount of 2011 gross revenues generated by employees in certain selected business units who remain with Morgan Keegan or Raymond James as of the date 90 days following the closing date of the transaction. The transaction is anticipated to close during the first quarter of 2012, subject to regulatory approval and customary closing conditions. Morgan Asset Management and Regions Morgan Keegan Trust are not included in the sale and will remain part of Regions’ Wealth Management organization. In connection with the agreement, the results of the entities being sold are reported as discontinued operations. The following tables represent the unaudited condensed results of operations for discontinued operations.


	Quarter Ended
($ amounts in millions)	12/31/11			9/30/11		6/30/11			3/31/11		12/31/10
Interest income	$	8		$	9	$	10		$	10	$	16
Interest expense		1			1		2			2		2

Net interest income		7			8		8			8		14
Non-interest income
Brokerage, investment banking and capital markets		251			222		229			236		279
Other		11			10		9			27		14

Total non-interest income		262			232		238			263		293
Non-interest expense
Salaries and employee benefits		172			146		160			166		190
Net occupancy expense		9			9		9			9		9
Furniture and equipment expense		9			7		7			7		8
Goodwill impairment		492			—		—			—		—
Other		59			54		66			53		69

Total non-interest expense		741			216		242			235		276
Income (loss) from discontinued operations before income tax		(472	)		24		4			36		31
Income tax expense (benefit) ^{(2) (3)}		(5	)		10		(26	)		17		9

Income (loss) from discontinued operations, net of tax	$	(467	)	$	14		30			19		22


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

Earnings (loss) per common share from discontinued operations:
Basic	$	(0.37	)	$	0.01	$	0.02		$	0.01	$	0.02
Diluted	$	(0.37	)	$	0.01	$	0.02		$	0.01	$	0.02



	Year Ended
($ amounts in millions)	2011			2010
Interest income	$	37		$	52
Interest expense		6			9

Net interest income		31			43
Non-interest income
Brokerage, investment banking and capital markets		938			990
Other		57			52

Total non-interest income		995			1,042
Non-interest expense
Salaries and employee benefits		644			678
Net occupancy expense		36			37
Furniture and equipment expense		30			27
Goodwill impairment⁽³⁾		492			—
Regulatory charge ⁽¹⁾		—			125
Other		232			259

Total non-interest expense		1,434			1,126

Loss from discontinued operations before income tax		(408	)		(41	)
Income tax expense (benefit) ^{(2), (3)}		(4	)		30

Loss from discontinued operations, net of tax	$	(404	)	$	(71	)


Weighted-average shares outstanding–during quarter:
Basic		1,258			1,227
Diluted		1,258			1,227

Earnings (loss) per common share from discontinued operations:
Basic	$	(0.32	)	$	(0.06	)
Diluted	$	(0.32	)	$	(0.06	)

(1)

(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.

(3)	The 2011 income tax benefit includes a $14 million benefit related to goodwill impairment recorded in the fourth quarter of 2011.


Regions Financial Corporation and Subsidiaries			Page 25
Financial Supplement to Fourth Quarter 2011 Earnings Release

Forward-Looking Statements

This supplement may include forward-looking statements which reflect Regions’ current views with respect to future events and financial performance. The Private Securities Litigation Reform 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 cause 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 statements 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. Those 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 and 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 issues in the banking system. 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 measures, which will depend on various factors, including the acceptance by our customers of modified fee structures for Regions’ products and services.

•

The impact of compensation and other restrictions imposed under the Troubled Asset Relief Program (“TARP”) until Regions repays the outstanding preferred stock and warrant issued under TARP including restrictions on Regions’ ability to attract and retain talented executives and associates.

•

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 increase 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.

•

The current 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

•

Potential dilution of holders of shares of Regions’ common stock resulting from the U.S. Treasury’s investment in TARP.

•

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.

•

The effects of any damage to Regions’ reputation resulting from developments related to any of the items identified above.

•

With regard to the sale of Morgan Keegan:

•

the possibility that regulatory and other approvals and conditions to the transaction are not received on a timely basis or at all; the possibility that modifications to the terms of the transaction may be required in order to obtain or satisfy such approvals or conditions; changes in the anticipated timing for closing the transaction; business disruption during the pendency of or following the transaction; diversion of management time on transaction-related issues; reputational risks and the reaction of customers and counterparties to the transaction

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.

The foregoing list of factors is not exhaustive; for discussion of these and other risks 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, 2010 and Quarterly Reports on Form 10-Q for the quarters ended March 31, 2011, June 30, 2011 and September 30, 2011 as on file with the Securities and Exchange Commission.

Regions’ Investor Relations contact is List Underwood at (205) 801-0265; Regions’ Media contact is Tim Deighton at (205) 264-4551

Attached files

Stock widget

Investing forum

REGIONS FINANCIAL CORP Reports