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Regions Financial Q4 Earnings Beat, Non-Interest Income Rises Y/Y
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Regions Financial Corporation’s (RF - Free Report) fourth-quarter 2024 adjusted earnings per share of 59 cents beat the Zacks Consensus Estimate of 55 cents per share. This compares favorably with earnings of 52 cents per share in the year-ago quarter.
Find the latest earnings estimates and surprises on the Zacks Earnings Calendar.
A decrease in non-interest expenses and an increase in non-interest income supported RF’s results. Also, Regions Financial’s strong capital position indicates its availability of adequate capital to use to deal with any unexpected losses. However, a decline in net interest income (NII) and lower loan balance were spoilsports.
The results exclude 3 cents per share of additional strategic securities repositioning and severance charges. After considering this, net income (GAAP basis) available to common shareholders was $508 million, up 38.4% year over year.
In 2024, adjusted earnings of $2.12 per share surpassed the consensus estimate of $2.07 but fell from $2.24 in 2023. Net income was $1.8 billion, down 10.2% from the prior-year quarter.
Regions Financial’s Revenues Rise, Expenses Dip Y/Y
Total quarterly revenues were $1.82 billion, surpassing the Zacks Consensus Estimate by 2.1%. The top line rose 0.2% from the year-ago quarter.
For 2024, total revenues were $7.08 billion, which missed the Zacks Consensus Estimate of $7.12 billion. Also, the top line declined 6.5% year over year.
Quarterly NII was $1.23 billion, down 0.1% year over year. Also, the net interest margin declined 5 basis points to 3.55%.
Non-interest income increased 0.9% year over year to $585 million.
Non-interest expenses fell 12.04% year over year to $1.04 billion. Adjusted non-interest expenses edged down 0.9% year over year to $1.03 billion.
The efficiency ratio was 56.8% in the fourth quarter compared with 55.4% in the prior-year quarter. A rise in this ratio indicates lower profitability.
As of Dec. 31, 2024, total loans decreased 0.7% on a sequential basis to $96.4 billion. Total deposits were $126.5 billion, which increased 0.4% from the previous quarter.
Regions Financial’s Credit Quality Mixed
Non-performing assets (excluding 90+ past due), as a percentage of loans, foreclosed properties and non-performing loans held for sale, increased to 0.97% from the prior-year quarter’s 0.84%. Non-performing loans, excluding loans held for sale as a percentage of net loans, were 0.96%, up from 0.82% in the prior-year quarter. A provision for credit losses of $120 million was recorded in the quarter, down 21.3% from the year-ago quarter.
Adjusted net charge-offs, as a percentage of average loans, were 0.49% compared with 0.39% in the prior-year period.
RF’s Capital Ratios Improve Y/Y
As of Dec. 31, 2024, the Common Equity Tier 1 ratio and the Tier 1 capital ratio were 10.8% and 12.2%, respectively, compared with 10.3% and 11.6% in the year-earlier quarter.
Regions Financial’s Share Repurchase Update
In the reported quarter, the company repurchased nearly 3 million shares for $58 million.
Our Viewpoint on RF
Regions Financial’s attractive core business and revenue-diversification strategies will likely yield stellar earnings in the upcoming period. The company’s robust capital planning process is intended to ensure the efficient use of capital to support lending activities and business growth opportunities, and offer suitable shareholder returns. However, declining loans, along with lower NII, are concerning.
Regions Financial Corporation Price, Consensus and EPS Surprise
Synovus Financial Corp. (SNV - Free Report) reported fourth-quarter 2024 adjusted earnings per share of $1.25, which surpassed the Zacks Consensus Estimate of $1.16 per share. This compares with earnings of 80 cents per share a year ago.
SNV’s results benefited from strong year-over-year growth in non-interest revenues (NIR), a rise in NII, and a fall in expenses and provisions for credit losses. Also, improving deposit balances acted as a tailwind. However, a rise in non-performing loans was a major headwind.
First Horizon Corporation’s (FHN - Free Report) fourth-quarter 2024 earnings per share (excluding notable items) of 43 cents surpassed the Zacks Consensus Estimate of 38 cents. This compares favorably with earnings per share of 32 cents in the year-ago quarter.
FHN’s results benefited from a year-over-year rise in NII and a decline in expenses. Also, lower provisions were another positive. However, a fall in fee income and a deteriorating capital position were major headwinds.
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Regions Financial Q4 Earnings Beat, Non-Interest Income Rises Y/Y
Regions Financial Corporation’s (RF - Free Report) fourth-quarter 2024 adjusted earnings per share of 59 cents beat the Zacks Consensus Estimate of 55 cents per share. This compares favorably with earnings of 52 cents per share in the year-ago quarter.
Find the latest earnings estimates and surprises on the Zacks Earnings Calendar.
A decrease in non-interest expenses and an increase in non-interest income supported RF’s results. Also, Regions Financial’s strong capital position indicates its availability of adequate capital to use to deal with any unexpected losses. However, a decline in net interest income (NII) and lower loan balance were spoilsports.
The results exclude 3 cents per share of additional strategic securities repositioning and severance charges. After considering this, net income (GAAP basis) available to common shareholders was $508 million, up 38.4% year over year.
In 2024, adjusted earnings of $2.12 per share surpassed the consensus estimate of $2.07 but fell from $2.24 in 2023. Net income was $1.8 billion, down 10.2% from the prior-year quarter.
Regions Financial’s Revenues Rise, Expenses Dip Y/Y
Total quarterly revenues were $1.82 billion, surpassing the Zacks Consensus Estimate by 2.1%. The top line rose 0.2% from the year-ago quarter.
For 2024, total revenues were $7.08 billion, which missed the Zacks Consensus Estimate of $7.12 billion. Also, the top line declined 6.5% year over year.
Quarterly NII was $1.23 billion, down 0.1% year over year. Also, the net interest margin declined 5 basis points to 3.55%.
Non-interest income increased 0.9% year over year to $585 million.
Non-interest expenses fell 12.04% year over year to $1.04 billion. Adjusted non-interest expenses edged down 0.9% year over year to $1.03 billion.
The efficiency ratio was 56.8% in the fourth quarter compared with 55.4% in the prior-year quarter. A rise in this ratio indicates lower profitability.
RF’s Loans Decline, Deposit Balance Rises Sequentially
As of Dec. 31, 2024, total loans decreased 0.7% on a sequential basis to $96.4 billion. Total deposits were $126.5 billion, which increased 0.4% from the previous quarter.
Regions Financial’s Credit Quality Mixed
Non-performing assets (excluding 90+ past due), as a percentage of loans, foreclosed properties and non-performing loans held for sale, increased to 0.97% from the prior-year quarter’s 0.84%. Non-performing loans, excluding loans held for sale as a percentage of net loans, were 0.96%, up from 0.82% in the prior-year quarter. A provision for credit losses of $120 million was recorded in the quarter, down 21.3% from the year-ago quarter.
Adjusted net charge-offs, as a percentage of average loans, were 0.49% compared with 0.39% in the prior-year period.
RF’s Capital Ratios Improve Y/Y
As of Dec. 31, 2024, the Common Equity Tier 1 ratio and the Tier 1 capital ratio were 10.8% and 12.2%, respectively, compared with 10.3% and 11.6% in the year-earlier quarter.
Regions Financial’s Share Repurchase Update
In the reported quarter, the company repurchased nearly 3 million shares for $58 million.
Our Viewpoint on RF
Regions Financial’s attractive core business and revenue-diversification strategies will likely yield stellar earnings in the upcoming period. The company’s robust capital planning process is intended to ensure the efficient use of capital to support lending activities and business growth opportunities, and offer suitable shareholder returns. However, declining loans, along with lower NII, are concerning.
Regions Financial Corporation Price, Consensus and EPS Surprise
Regions Financial Corporation price-consensus-eps-surprise-chart | Regions Financial Corporation Quote
Currently, Regions Financial carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Banks
Synovus Financial Corp. (SNV - Free Report) reported fourth-quarter 2024 adjusted earnings per share of $1.25, which surpassed the Zacks Consensus Estimate of $1.16 per share. This compares with earnings of 80 cents per share a year ago.
SNV’s results benefited from strong year-over-year growth in non-interest revenues (NIR), a rise in NII, and a fall in expenses and provisions for credit losses. Also, improving deposit balances acted as a tailwind. However, a rise in non-performing loans was a major headwind.
First Horizon Corporation’s (FHN - Free Report) fourth-quarter 2024 earnings per share (excluding notable items) of 43 cents surpassed the Zacks Consensus Estimate of 38 cents. This compares favorably with earnings per share of 32 cents in the year-ago quarter.
FHN’s results benefited from a year-over-year rise in NII and a decline in expenses. Also, lower provisions were another positive. However, a fall in fee income and a deteriorating capital position were major headwinds.