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Regions Financial Corporation Net Income Jumps 10% in 2013

Regions Financial Corporation (NYSE: RF  ) reported its fourth-quarter and full-year 2013 earnings today, with a net income of $219 million and $1.1 billion, respectively. The most recent quarter included a number of notable items that reduced net income by $75 million after tax, or $0.05 per share.

Its earnings in the fourth quarter were down 16% relative to the fourth quarter the previous year, when it reported a net income of $261 million, as a result of the one-time charges. However for the full year its net income was up by 10% compared to the $1.05 billion seen in 2012.

The fourth quarter included a number of notable items that reduced net income at Regions by $75 million after tax. Those one-time items included a $46 million impact from the transfer of nearly $700 million worth of troubled loans to held-for-sale status and a $3 million impact resulting from the consolidation of 30 branches. In addition, the company faced a $58 million regulatory charge, but also a $40 million gain from adjustments surrounding the valuation of its debt portfolio. Lastly, Regions incurred a $14 million charge related to its sale of Morgan Keegan, its brokerage arm, to Raymond James Financial in 2012.

"2013 was a foundational year for Regions as we took decisive action to position the company for long term, sustainable growth while also achieving positive loan growth," said Regions Financial Chairman, President, and CEO Grayson Hall. "By focusing on meeting the financial needs of our customers and maintaining our efforts to operate more efficiently, we concluded the year with more customers and successfully lowered adjusted expenses compared to the prior year."

In total, Regions Financial's earnings per share stood at $0.16 and $0.77 in the fourth quarter and full year of 2013, respectively, relative to $0.18 and $0.71 in 2012. Its tangible book value rose from $7.11 at the end of 2012 to $7.54 at the end of 2013, an increase of 6%.

Regions did see its profit metrics dip in the fourth quarter, as its return on average assets stood at 0.79% relative to 0.97% in the third quarter of 2013 and 0.90% in the fourth quarter of 2012. It efficiency ratio also rose from 62.7% in the fourth quarter of 2012 to 66.3% in the fourth quarter of 2013. However it was below the 67.3% seen in the third quarter of 2013.

Hall concluded by noting, "We are optimistic about growth prospects for 2014 as consumers and businesses begin the year with healthy balance sheets and the economy continues to improve."


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Patrick Morris

After a few stints in banking and corporate finance, Patrick joined the Motley Fool as a writer covering the financial sector. He's scaled back his everyday writing a bit, but he's always happy to opine on the latest headline news surrounding Berkshire Hathaway, Warren Buffett and all things personal finance.

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8/28/2015 3:11 PM
RF $9.58 Up +0.02 +0.21%
Regions Financial… CAPS Rating: ***