REGIONS FINANCIAL CORP
For the period ended Jun 30, 2025. Filed Aug 5, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2025 · Filed Aug 5, 2025
RF$28.31-0.4%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-03-31; filed 2025-05-06.
0001281761-25-000045
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-06-30; filed 2025-08-05.
0001281761-25-000063
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 267 previous paragraphs and 272 current paragraphs.
178 unchanged; 68 reworded; 18 added; 18 removed; 3 previous and 8 current paragraphs rearranged.
Tables are not compared: 26 previous and 28 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (18)
Current report
SECOND QUARTER OVERVIEW
Current report
Second Quarter Results
Current report
Non-interest income was $646 million in the second quarter of 2025 compared to $545 million in the second quarter of 2024. Most categories of non-interest income increased, primarily driven by an increase in capital markets income, mortgage income, and favorable market valuation adjustments on employee benefit assets. Additionally, in the second quarter of 2024, the Company incurred securities losses due to a repositioning. See Table 21 "Non-Interest Income" for further details.
Current report
Cash and cash equivalents increased approximately $463 million from year-end 2024 to June 30, 2025 primarily due to an increase in deposits, partially offset by securities purchases, a decline in borrowings and the redemption of Series D preferred stock. See the "Deposits", "Debt Securities", "Liquidity", and "Borrowings" sections for more information.
Current report
(1) Starting in 2025, other consumer loans also includes exit portfolios, which were previously presented separately. The portfolio consists primarily of indirect auto loans, and presentation of prior periods has been conformed accordingly.
Current report
In deriving any forecast, Regions benchmarks its internal forecast with external forecasts and external data available. Regions' June 2025 baseline forecast reflected deterioration across most key variables as compared to the March baseline forecast, which resulted in an increase in the allowance. Management noted that there is still uncertainty around the scope and timing of changes to trade policy and the effects of immigration policy to the labor market may pose some downside risks to growth. However, recently enacted fiscal policy changes are expected to be supportive of business investment spending, and an anticipated more favorable regulatory climate should also be supportive of growth.
Current report
The June 2025 baseline forecast anticipates real GDP growth of 1.5 percent in 2025 and 2026. While the quarterly growth profile is expected to remain somewhat uneven over the next few quarters, it is anticipated that the economy will be back at its longer-term trend growth rate by year-end 2026.
Current report
As job and wage growth are slowing, spending growth is becoming realigned with income growth. In the early months of 2025, businesses and households reacted strongly to anticipated increases in tariffs, which sets up payback over the coming months and quarters. The baseline forecast anticipates the unemployment rate averaging 4.3 percent for 2025 and 2026, and reflects further deceleration in the trend of job rate growth due to a falling rate of hiring as opposed to a rising rate of layoffs.
Current report
Through the first half of the year there has been mixed evidence of tariff pass-throughs on goods prices. While it is anticipated that pass-through effects will become more impactful and more broadly based over coming months, it is also anticipated that moderating services price inflation will act as a counter. This would limit the net effects on overall inflation.
Current report
While the FOMC is taking a cautious approach and is still more focused on the upside risks to inflation, we cannot rule out a resumption of Federal Funds rate hikes by year-end 2025.
Current report
In the second quarter of 2025, the loan portfolio balance grew, which, combined with the results from credit/specific reserve changes and other portfolio changes, resulted in a net increase to the allowance.
Current report
Long-term borrowings decreased by approximately $714 million from year-end 2024 primarily due to the maturity of the Company's 2.25% senior notes in the second quarter of 2025.
Current report
NM - Not Meaningful
Current report
Mortgage Income
Current report
Mortgage income is generated through the origination and servicing of residential mortgage loans for long-term investors and sales of residential mortgage loans in the secondary market. The increase in mortgage income in the second quarter and six months ended June 30, 2025 compared to the same periods in 2024 was due primarily to favorable mortgage servicing rights valuation adjustments. The increase in mortgage income in the six months ended June 30, 2025 was partially offset by negative pipeline valuation adjustments.
Current report
Other Miscellaneous Expenses
Current report
Other miscellaneous expenses include expenses related to communications, postage, supplies, certain credit-related costs, foreclosed property expenses, mortgage repurchase costs, and other costs (benefits) related to employee benefit plans. Other miscellaneous expenses increased the second quarter and six months ended June 30, 2025 compared to the same periods in 2024 primarily due to a contingent reserve release in the second quarter of 2024 related to a prior acquisition that did not repeat.
Current report
On July 4, 2025, the One Big Beautiful Bill Act passed into law. The Company is still evaluating the impacts of the statute to the consolidated financial statements and expects that such impacts will be immaterial.
Removed paragraphs (18)
Previous report
FIRST QUARTER OVERVIEW
Previous report
Regions' March baseline forecast, utilized in calculating the ACL as of March 31, 2025, anticipated real GDP growth of 1.8 percent in 2025 and 1.7 percent in 2026. Coming into 2025, Regions' expectation was that above-trend pace of growth seen in 2023 and 2024 would not be sustained and that real GDP growth would settle back toward the pre-pandemic trend rate.
Previous report
Though inflation was expected to remain above the FOMC’s 2.0 percent target rate through 2025, it was nonetheless expected to decelerate further which, in conjunction with a modestly higher unemployment rate, was seen as giving the FOMC the latitude to resume cutting the Fed funds rate. It was, however, noted that there was considerable uncertainty over the timing and magnitude of further cuts in the funds rate.
Previous report
Though the trend rate of growth in nonfarm employment had for some time been slowing, that had been a function of a diminished rate of hiring, as the rate at which firms were laying workers off remained below pre-pandemic norms. While the pace of job growth was expected to decelerate further, significantly slower labor supply growth stemming from changes in immigration policy was expected to blunt upward pressure on the unemployment rate, which was expected to average 4.3 percent in the fourth quarter of 2025. Even with a slowing trend rate of job growth, aggregate labor earnings were expected to continue growing at a rate easily above inflation, thus acting as a support for consumer spending.
Previous report
Management noted that considerable uncertainty around the scope and timing of changes to fiscal, regulatory, trade, and immigration policy would likely act as a source of volatility in the Company’s baseline forecasts, particularly around the paths of real GDP growth, inflation, and the unemployment rate. The March baseline forecast incorporated this uncertainty.
Previous report
Changes in trade policy announced subsequent to the end of the first quarter of 2025 have further increased the uncertainty around Regions’ economic forecasts. The pace of implementation, the duration, and the reactions of foreign nations to the changes in trade policy are unclear. Patterns of economic activity within the Regions footprint are expected to be broadly similar to those seen for the U.S. as a whole. While the footprint will not be immune to any disruptions in economic activity stemming from volatility around trade policy, it is expected that over time population, employment, and income growth within the footprint will continue to grow at a slightly above-average rate.
Previous report
First Quarter Results
Previous report
Non-interest income was $590 million in the first quarter of 2025 compared to $563 million in the first quarter of 2024. The increase was primarily driven by an increase in service charge income and lower securities losses. These increases were partially offset by a decline in capital markets income and unfavorable market valuation adjustments on employee benefit assets, which are offset in non-interest expense. See Table 21 "Non-Interest Income" for further details.
Previous report
Cash and cash equivalents increased approximately $3.6 billion from year-end 2024 to March 31, 2025 resulting from an increase in cash balances on deposit with the Federal Reserve Bank driven primarily by an increase in deposits and a decline in loans, partially offset by a decline in short-term borrowings. See the "Deposits", "Liquidity", and "Loans" sections for more information.
Previous report
Subsequent to March 31, 2025, the Company reclassified debt securities with an amortized cost, excluding items recognized in OCI, of $1.0 billion from available for sale to held to maturity. Additionally, the debt securities portfolio was increased by approximately $1.0 billion through the purchase of residential agency MBS given favorable market and bank funding dynamics.
Previous report
As discussed in the Economic Environment in Regions' Banking Markets within the "First Quarter Overview" section, the economic environment has become more uncertain since March 31, 2025 which may impact the macroeconomic factors utilized in the baseline economic forecast for the second quarter of 2025 allowance estimation process. Also as discussed in the "Critical Accounting Estimates and Related Policies" section in the Annual Report on Form 10-K for the year ended December 31, 2024, it is difficult to estimate how potential changes in any one economic factor might affect the overall allowance because a wide variety of factors and inputs are considered in the allowance estimate. Changes in the factors and inputs may not occur at the same rate and may not be consistent across all product types. Additionally, changes in factors and inputs may be directionally inconsistent, such that improvement in one factor may offset deterioration in others. However, to consider the impact of a hypothetical alternate economic forecast, Regions estimated the allowance using a scenario that was one standard deviation unfavorable to the expected scenario for each macroeconomic variable. This unfavorable scenario resulted in an allowance approximately 15 percent higher than the allowance using the baseline scenario.
Previous report
Long-term borrowings increased by approximately $26 million from year-end 2024 due to valuation adjustments.
Previous report
Net interest margin declined 3 basis points in the three months ended March 31, 2025 compared to the same period in 2024. The change in the net interest margin is the result of the same drivers as net interest income, but is also negatively impacted by the shift in the earning asset mix to hold a higher level of liquid cash balances with the Federal Reserve (see the "Cash and Cash Equivalents" section for related discussion).
Previous report
Regions' comprehensive interest rate risk management approach uses derivatives and debt securities to manage its interest rate risk position.
Previous report
Other Miscellaneous Income
Previous report
Other miscellaneous income includes net revenue from affordable housing, valuation adjustments to equity investments, fees from safe deposit boxes, check fees and other miscellaneous income. Net revenue from affordable housing includes actual gains and losses resulting from the sale of affordable housing investments, cash distributions from the investments and any related impairment charges. Other miscellaneous income increased due to improvement in valuation adjustments on certain equity investments.
Previous report
Professional, Legal and Regulatory Expenses
Previous report
Professional, legal, and regulatory expenses consist of amounts related to legal, consulting, other professional fees and regulatory charges. Professional, legal and regulatory expenses decreased in three months ended March 31, 2025 compared to the same period in 2024 due to higher accruals for legal and regulatory matters in the first quarter of 2024.
Reworded paragraphs (68)
Previous wording
The following discussion and analysis is part of Regions Financial Corporation’s (“Regions” or the “Company”) Quarterly Report on Form 10-Q filed with the SEC and updates Regions’ Annual Report on Form 10-K for the year ended December 31, 2024, which was previously filed with the SEC. This financial information is presented to aid in understanding Regions’ financial position and results of operations and should be read together with the financial information contained in Regions’ Annual Report on Form 10-K. See Note 1 "Basis of Presentation" and Note 13 "Recent Accounting Pronouncements" to those consolidated financial statements for further detail. The emphasis of this discussion will be on the three months ended March 31, 2025 compared to the three months ended March 31, 2024 for the consolidated statements of income. For the consolidated balance sheets, the emphasis of this discussion will be on the balances as of March 31, 2025 compared to December 31, 2024.
Current wording
The following discussion and analysis is part of Regions Financial Corporation’s (“Regions” or the “Company”) Quarterly Report on Form 10-Q filed with the SEC and should be read in conjunction with the consolidated financial statements and the related notes that appear in Part I, Item 1 of this report. In addition, this discussion and analysis updates Regions’ Annual Report on Form 10-K for the year ended December 31, 2024, which was previously filed with the SEC. This financial information is presented to aid in understanding Regions’ financial position and results of operations and should be read together with the financial information contained in Regions’ Annual Report on Form 10-K. See Note 1 "Basis of Presentation" and Note 13 "Recent Accounting Pronouncements" to those consolidated financial statements for further detail. The emphasis of this discussion will be on the three and six months ended June 30, 2025 compared to the three and six months ended June 30, 2024 for the consolidated statements of income. For the consolidated balance sheets, the emphasis of this discussion will be on the balances as of June 30, 2025 compared to December 31, 2024.
Previous wording
Regions conducts its banking operations through Regions Bank, an Alabama state-chartered commercial bank that is a member of the Federal Reserve System. At March 31, 2025, Regions operated 1,249 total branch outlets. Regions carries out its strategies and derives its profitability from three reportable business segments: Corporate Bank, Consumer Bank, and Wealth Management, with the remainder in Other. See Note 11 "Business Segment Information" to the consolidated financial statements for more information regarding Regions’ segment reporting structure.
Current wording
Regions conducts its banking operations through Regions Bank, an Alabama state-chartered commercial bank that is a member of the Federal Reserve System. At June 30, 2025, Regions operated 1,250 total branch outlets. Regions carries out its strategies and derives its profitability from three reportable business segments: Corporate Bank, Consumer Bank, and Wealth Management, with the remainder in Other. See Note 11 "Business Segment Information" to the consolidated financial statements for more information regarding Regions’ segment reporting structure.
Previous wording
The economic environment, as described above, impacted Regions' forecast utilized in calculating the ACL as of March 31, 2025. See the "Allowance" section for further information.
Current wording
Regions utilized its internal June baseline forecast to calculate the ACL as of June 30, 2025. Refer to the Baseline economic forecast discussion in the "Allowance" section for further detail.
Previous wording
Regions reported net income available to common shareholders of $465 million or $0.51 per diluted share in the first quarter of 2025 compared to net income available to common shareholders of $343 million or $0.37 per diluted share in the first quarter of 2024.
Current wording
Regions reported net income available to common shareholders of $534 million or $0.59 per diluted share in the second quarter of 2025 compared to net income available to common shareholders of $477 million or $0.52 per diluted share in the second quarter of 2024.
Previous wording
Net interest income (taxable-equivalent basis) totaled $1.2 billion in the first quarter of 2025, which increased $9 million compared to the first quarter of 2024. The net interest margin (taxable-equivalent basis) was 3.52 percent in the first quarter of 2025, reflecting a 3 basis point decrease from the same period in 2024. The slight increase in net interest income was driven by the replacement of fixed rate loans and securities in a high interest rate environment including securities repositioning activities, coupled with hedging benefits and the ability to manage funding costs lower as short-term interest rates declined. The decline in net interest margin was primarily driven by a shift in earning asset mix to hold higher levels of cash with the Federal Reserve. Refer to the related discussion below Table 16 "Consolidated Average Daily Balances and Yield/Rate Analysis" for further detail.
Current wording
Net interest income (taxable-equivalent basis) totaled $1.3 billion in the second quarter of 2025, which increased $73 million compared to the second quarter of 2024. The net interest margin (taxable-equivalent basis) was 3.65 percent in the second quarter of 2025, reflecting a 14 basis point increase from the same period in 2024. The increase in net interest income and margin was driven by the replacement of fixed-rate loans and debt securities in a higher interest rate environment and lower funding costs as short-term interest rates declined. Refer to the related discussion below Table 16 "Consolidated Average Daily Balances and Yield/Rate Analysis" for further detail.
Previous wording
The provision for credit losses totaled $124 million in the first quarter of 2025 compared to $152 million in the first quarter of 2024. Net charge-offs totaled $123 million, or 0.52 percent of average loans, in the first quarter of 2025, compared to $121 million, or 0.50 percent in the first quarter of 2024. This slight increase reflected charge-offs in previously identified portfolios of interest. The allowance as a percent of total loans, net, increased to 1.81 percent at March 31, 2025, compared to 1.79 percent at December 31, 2024. Refer to the "Allowance for Credit Losses" section for further detail.
Current wording
The provision for credit losses totaled $126 million in the second quarter of 2025 compared to $102 million in the second quarter of 2024. Net charge-offs totaled $113 million, or 0.47 percent of average loans, in the second quarter of 2025, compared to $101 million , or 0.42 percent in the second quarter of 2024. This slight increase reflected charge-offs in previously identified portfolios of interest. The allowance as a percent of total loans, net, increased slightly to 1.80 percent at June 30, 2025, compared to 1.79 percent at December 31, 2024. Refer to the "Allowance for Credit Losses" section for further detail.
Previous wording
Non-interest expense was $1.0 billion in the first quarter of 2025 which decreased $92 million compared to the first quarter of 2024. The decrease was primarily driven by a decline in salaries and benefits, operational losses, and FDIC insurance expense. See Table 22 "Non-Interest Expense" for further details.
Current wording
Non-interest expense was $1.1 billion in the second quarter of 2025 which increased $69 million compared to the second quarter of 2024. The increase was primarily driven by a increase in salaries and benefits and other miscellaneous expenses. See Table 22 "Non-Interest Expense" for further details.
Previous wording
Regions' effective tax rate was 21.1 percent in the first quarter of 2025 compared to 20.7 percent in the first quarter of 2024. See the "Income Taxes" section for further details.
Current wording
Regions' effective tax rate was 20.3 percent in the second quarter of 2025 compared to 19.8 percent in the second quarter of 2024. See the "Income Taxes" section for further details.
Previous wording
Debt securities, which comprise approximately 19 percent of earning assets, are an important tool used to manage interest rate sensitivity and provide a primary source of liquidity for the Company, as much of the portfolio is highly liquid. Additionally, some of the debt securities portfolio is eligible to be used as collateral for funding of various types of borrowings. See the "Liquidity" section for more information on these arrangements. Also see the "Market Risk-Interest Rate Risk" section for more information. See also Note 3 "Debt Securities" for additional information.
Current wording
Debt securities, which comprise approximately 23 percent of earning assets, are an important tool used to manage interest rate sensitivity and provide a primary source of liquidity for the Company, as much of the portfolio is highly liquid. Additionally, some of the debt securities portfolio is eligible to be used as collateral for funding of various types of borrowings. See the "Liquidity" section for more information on these arrangements. Also see the "Market Risk-Interest Rate Risk" section for more information. See also Note 3 "Debt Securities" for additional information.
Previous wording
Debt securities held to maturity constituted approximately 17 percent of the debt securities portfolio at March 31, 2025. The Company reclassified debt securities with an amortized cost, excluding items recognized in OCI, of $1.0 billion in the first quarter of 2025, from available for sale into held to maturity to reduce the volatility in AOCI in preparation for expected, upcoming changes to regulatory guidance as discussed in the "Regulatory Requirements" section.
Current wording
Debt securities held to maturity constituted approximately 18 percent of the debt securities portfolio at June 30, 2025. The Company reclassified debt securities with an amortized cost, excluding items recognized in OCI, of $2.0 billion in the first half of 2025, from available for sale into held to maturity to reduce the volatility in AOCI in preparation for expected, upcoming changes to regulatory guidance as discussed in the "Regulatory Requirements" section.
Previous wording
Debt securities available for sale constituted approximately 83 percent of the debt securities portfolio at March 31, 2025. Regions maintains a highly-rated debt securities portfolio consisting primarily of agency MBS. Regions’ investment policy emphasizes credit quality and liquidity.
Current wording
Debt securities available for sale constituted approximately 82 percent of the debt securities portfolio at June 30, 2025. Regions maintains a highly-rated debt securities portfolio consisting primarily of agency MBS. Regions’ investment policy emphasizes credit quality and liquidity.
Previous wording
Debt securities increased $486 million from December 31, 2024 to March 31, 2025 due to higher unrealized holding gains as a result of lower rates during the first quarter of 2025. Of note, the Company executed a debt securities repositioning in the first quarter of 2025 involving the sale of shorter-duration commercial and residential agency MBS and replacement with residential agency MBS with favorable prepayment profiles. The intent was to maintain the debt securities portfolio duration that would otherwise shorten naturally while efficiently deploying capital. Proceeds from the sales were reinvested at higher market yields. The Company sold approximately $478 million of debt securities available for sale and realized approximately $25 million in pre-tax losses.
Current wording
Debt securities increased $1.7 billion from December 31, 2024 to June 30, 2025 due to the purchase of approximately $1.0 billion of residential agency MBS debt securities in the second quarter of 2025, lower market interest rates and tighter spreads resulting in lower unrealized holding losses, and AOCI amortization. Of note, the Company executed a debt securities repositioning in the first quarter of 2025 involving the sale of shorter-duration commercial and residential agency MBS and replacement with residential agency MBS with favorable prepayment profiles. The intent was to maintain the debt securities portfolio duration that would otherwise shorten naturally while efficiently deploying capital. Proceeds from the sales were reinvested at higher market yields. The Company sold approximately $478 million of debt securities available for sale and realized approximately $25 million in pre-tax losses.
Previous wording
The average life of the debt securities portfolio at March 31, 2025 was estimated to be 6.0 years, with a duration of approximately 4.2 years, inclusive of fair value hedges (see Table 18). These metrics compare with an estimated average life of 6.1 years and a duration of approximately 4.5 years for the portfolio at December 31, 2024.
Current wording
The average life of the debt securities portfolio at June 30, 2025 was estimated to be 6.0 years, with a duration of approximately 4.1 years, inclusive of fair value hedges (see Table 18). These metrics compare with an estimated average life of 6.1 years and a duration of approximately 4.5 years for the portfolio at December 31, 2024.
Previous wording
Loans, net of unearned income, decreased $994 million from year-end 2024, primarily due to decreases in the commercial and industrial portfolio class. Regions manages loan growth with a focus on risk management and risk-adjusted return on capital.
Current wording
Loans, net of unearned income, remained flat from year-end 2024 due to a decline in commercial loans as a result of low utilization rates and declines across most consumer loans, partially offset by an increase in investor real estate loans. Regions manages loan growth with a focus on risk management and risk-adjusted return on capital.
Previous wording
Commercial and industrial loans decreased $792 million since year-end 2024, due to credit utilization rates remaining below historic levels and customers carrying more liquidity. Throughout the first quarter, the decline in commercial and industrial loans was broad-based as shown in Table 4.
Current wording
Commercial and industrial loans decreased $85 million since year-end 2024 due primarily to credit utilization rates remaining below historic levels. In the first six months of 2025, the decline in commercial and industrial loans was broad-based as shown in Table 4.
Previous wording
Loans for real estate development are repaid through cash flows related to the operation, sale or refinance of the property. This portfolio segment includes extensions of credit to real estate developers or investors where repayment is dependent on the sale of real estate or income generated from the real estate collateral. A portion of Regions’ IRE portfolio segment consists of loans secured by residential product types (land, single-family and condominium loans) within Regions’ markets. Additionally, this category includes loans made to finance income-producing properties such as apartment buildings, office and industrial buildings, and retail shopping centers. Total IRE loans increased $123 million in comparison to year-end 2024 balances.
Current wording
Loans for real estate development are repaid through cash flows related to the operation, sale or refinance of the property. This portfolio segment includes extensions of credit to real estate developers or investors where repayment is dependent on the sale of real estate or income generated from the real estate collateral. A portion of Regions’ IRE portfolio segment consists of loans secured by residential product types (land, single-family and condominium loans) within Regions’ markets. Additionally, this category includes loans made to finance income-producing properties such as apartment buildings, office and industrial buildings, and retail shopping centers. Total IRE loans increased $388 million in comparison to year-end 2024 balances due to increases in fundings to previously approved projects and new term loans for apartments and data centers.
Previous wording
Portfolios that are experiencing higher risk due to conditions such as inflationary pressures, higher interest rates, and adverse underlying market fundamentals (identified as portfolios of interest) include business offices and trucking (included within transportation and warehousing) at March 31, 2025 within Table 4 above. The senior housing portfolio, included within healthcare, was no longer considered a portfolio of interest during the first quarter of 2025 as senior housing fundamentals continue to improve. Demographic, economic, and sector trends have improved after an extended post-pandemic period, resulting in the remaining risk in the portfolio concentrated with a few specific borrowers as opposed to industry-wide risk. Recent and potential future interest rate cuts should ease pressure on borrowers across the entire loan portfolio.
Current wording
Portfolios that are experiencing higher risk due to conditions such as inflationary pressures, higher interest rates, and adverse underlying market fundamentals (identified as portfolios of interest) include business offices and trucking (included within transportation and warehousing) at June 30, 2025 within Table 4 above. Recent and potential future interest rate cuts should ease pressure on borrowers across the entire loan portfolio.
Previous wording
The business offices portfolio remains a portfolio of interest due to rising vacancies and reductions in net effective rents. The office portfolio totaled $1.4 billion and represented 1.5 percent of total loans at March 31, 2025. The office portfolio included non-performing loans of $184 million and had associated charge-offs of $20 million in the three months ended March 31, 2025. Approximately 88 percent of the office portfolio was secured, with approximately 60 percent of secured balances located in the South region of the U.S, of which 90 percent were Class A properties. Approximately 50 percent of the office portfolio will mature in the next 12 months. Additionally, the IRE office portfolio had a weighted-average LTV of approximately 70 percent at March 31, 2025, based upon appraisal at origination or most recent received, and a stressed weighted-average LTV of approximately 85 percent as of April 4, 2025, based upon GreenStreet's Commercial Property Price Index. No new loan originations are being contemplated in this portfolio.
Current wording
The business offices portfolio remains a portfolio of interest due to rising vacancies and reductions in net effective rents. The office portfolio totaled $1.3 billion and represented 1.4 percent of total loans at June 30, 2025. The office portfolio included non-performing loans of $213 million and had associated charge-offs of $20 million in the six months ended June 30, 2025. Approximately 90 percent of the office portfolio was secured, with approximately 59 percent of secured balances located in the South region of the U.S, of which 86 percent were Class A properties. Over 50 percent of the office portfolio will mature in the next 12 months. Additionally, the IRE office portfolio had a weighted-average LTV of approximately 70 percent at June 30, 2025, based upon appraisal at origination or most recent received, and a stressed weighted-average LTV of approximately 86 percent as of July 7, 2025, based upon GreenStreet's Commercial Property Price Index. No new loan originations are being contemplated in this portfolio.
Previous wording
The trucking portfolio, included within transportation and warehousing, remains a portfolio of interest as trucking companies have been working through one of the most prolonged downturns in the U.S. domestic freight market. Uncertainty with respect to tariffs and the resulting impact on consumer spending and business investment make the path forward difficult to predict. The trucking portfolio totaled $1.4 billion and represented 1.5 percent of total loans at March 31, 2025. The trucking portfolio included non-performing loans of $109 million and had associated charge-offs of $27 million in the three months ended March 31, 2025.
Current wording
The trucking portfolio, included within transportation and warehousing, remains a portfolio of interest as trucking companies have been working through one of the most prolonged downturns in the U.S. domestic freight market. The industry has experienced marginal improvement in 2025; however, recent tariff policies have lead to inconsistent volumes which combined with rising operating costs make profitability more challenging. The trucking portfolio totaled $1.4 billion and represented 1.5 percent of total loans at June 30, 2025. The trucking portfolio included non-performing loans of $114 million and had associated charge-offs of $42 million in the six months ended June 30, 2025.
Previous wording
Residential first mortgage loans represent loans to consumers to finance a residence. These loans are typically financed over a 15 to 30 year term and, in most cases, are extended to borrowers to finance their primary residence. Total residential first mortgage loans decreased $94 million in comparison to year-end 2024 balances due to lower seasonal production.
Current wording
Residential first mortgage loans represent loans to consumers to finance a residence. These loans are typically financed over a 15 to 30 year term and, in most cases, are extended to borrowers to finance their primary residence. Total residential first mortgage loans decreased $74 million in comparison to year-end 2024 balances.
Previous wording
Home equity lines are secured by a first or second mortgage on the borrower's residence and allow customers to borrow against the equity in their homes. Home equity lines decreased $20 million in comparison to year-end 2024 balances. Substantially all of this portfolio was originated through Regions' branch network.
Current wording
Home equity lines are secured by a first or second mortgage on the borrower's residence and allow customers to borrow against the equity in their homes. Substantially all of this portfolio was originated through Regions' branch network.
Previous wording
Other consumer loans primarily include indirect and direct consumer loans, overdrafts and other revolving loans. Other consumer loans decreased $122 million from year-end 2024 driven by a decline in consumer home improvement lending due to seasonality.
Current wording
Other consumer loans primarily include indirect and direct consumer loans, overdrafts and other revolving loans. Other consumer loans decreased $190 million from year-end 2024 driven by a decline in consumer home improvement lending production.
Previous wording
In deriving any forecast, Regions benchmarks its internal forecast with external forecasts and external data available. Regions' March 2025 baseline forecast declined slightly compared to the December 2024 forecast resulting in an increase to the allowance. As job and wage growth are slowing, spending growth is becoming realigned with income growth. The baseline forecast anticipates further deceleration in the trend of job rate growth, but a slowdown in labor supply growth is expected to blunt upward pressure on the unemployment rate. Changes to trade and immigration policy have the potential to add to inflation pressure and core inflation is expected to remain above the FOMC's 2.0 percent target rate through 2026. The risks to the baseline forecast are considered to be weighted to the downside. Current economic uncertainty, including any effects of the recently announced tariffs combined with the pause on those tariffs, as well as shifting immigration reform policy, likely will influence future levels of the allowance. Refer to the Economic Environment in Regions' Banking Markets within the "First Quarter Overview" section for more information.
Current wording
The risks to the baseline forecast are considered to be weighted to the downside. Current economic uncertainty, including the impact of developments on trade policy, likely will influence future levels of the allowance.
Previous wording
Table 8 below reflects a range of macroeconomic factors utilized in the baseline economic forecast over the two-year R&S forecast period as of March 31, 2025. The unemployment rate is the most significant macroeconomic factor among the allowance models and as of the March 2025 baseline forecast was expected to remain relatively consistent over the forecast period. The unemployment rate expectations for the R&S forecast period that will be determined in the second quarter of 2025 are uncertain and may vary, perhaps materially, from those currently shown in Table 8 .
Current wording
Table 8 below reflects a range of macroeconomic factors utilized in the baseline economic forecast over the two-year R&S forecast period as of June 30, 2025. The unemployment rate is the most significant macroeconomic factor among the allowance models and as of the June 2025 baseline forecast was expected to remain relatively consistent over the forecast period.
Previous wording
The loan portfolio composition is evaluated each quarter and changes to the composition can influence modeled allowance results. In the first quarter of 2025, the loan portfolio balance declined as did the average remaining life of the portfolio, resulting in a reduction in the allowance.
Current wording
The loan portfolio composition is evaluated each quarter and changes to the composition can influence modeled allowance results.
Previous wording
Credit metrics are monitored throughout each quarter and are a key consideration in the allowance process. In the first quarter of 2025, overall asset quality deteriorated slightly. Commercial and investor real estate criticized balances increased approximately $202 million compared to the fourth quarter of 2024. The slight decline in credit quality resulted in an increase to the allowance.
Current wording
Credit metrics are monitored throughout each quarter and are a key consideration in the allowance process. In the second quarter of 2025, overall asset quality improved. Commercial and investor real estate criticized balances decreased approximately $310 million compared to the first quarter of 2025. Non-performing loans, excluding held for sale, decreased approximately $67 million compared to the first quarter of 2025. The decrease in non-performing loans was primarily due to charge-offs and payoffs in previously identified portfolios of interest which led to a decline in specific reserves. See Table 11 for more details regarding non-performing assets. While overall credit quality improved in the quarter, the portfolio experienced some risk rating migration, mostly within pass ratings. These increases were offset by other portfolio changes.
Previous wording
While it is the intent of Regions' quantitative allowance methodologies to reflect all risk factors, including incremental risk in portfolios identified as under stress, any estimate involves assumptions and uncertainties resulting in some level of imprecision. Regions' qualitative framework has a general imprecision component which is meant to acknowledge that model and forecast errors are inherent in any modeling estimate. In the first quarter of 2025, the general imprecision component increased due to increased uncertainty of economic policy changes, including impacts from potential new tariffs as discussed above.
Current wording
While it is the intent of Regions' quantitative allowance methodologies to reflect all risk factors, including incremental risk in portfolios identified as under stress, any estimate involves assumptions and uncertainties resulting in some level of imprecision. Regions' qualitative framework has a general imprecision component which is meant to acknowledge that model and forecast errors are inherent in any modeling estimate. In the second quarter of 2025, the general imprecision component decreased due to less downside risk to the economic forecast.
Previous wording
The qualitative framework also has specific adjustment components which are reserves meant to capture specific issues or events that management believes are not adequately captured in the model outcomes. Qualitative adjustments for the first quarter of 2025 were reduced from the fourth quarter of 2024 levels due to reduced risk in certain portfolios of interest and more of the remaining risk being captured in the loss forecasting models and specific reserve estimates, as well as additional portfolio stability resulting in less uncertainty in some portfolios.
Current wording
The qualitative framework also has specific adjustment components which are reserves meant to capture specific issues or events that management believes are not adequately captured in the model outcomes. Qualitative adjustments for the second quarter of 2025 were reduced from the first quarter of 2025 levels due to reduced risk in certain portfolios of interest and more of the remaining risk being captured in the loss forecasting models and specific reserve estimates, as well as additional portfolio stability.
Previous wording
The combined results from general imprecision and specific qualitative adjustments was a net increase to the allowance.
Current wording
The combined results from general imprecision and specific qualitative adjustments was a net decrease to the allowance.
Previous wording
Based upon the factors discussed above, the March 31, 2025 allowance remained stable compared to the fourth quarter of 2024 due to declines in specific reserves and a reduction in overall loan balances, offset by model increases associated with current economic uncertainty as well as incremental qualitative overlays.
Current wording
Based upon the factors discussed above, the June 30, 2025 allowance remained stable compared to the first quarter of 2025 due to portfolio changes and slight deterioration in the economic forecast, offset by declines in qualitative adjustments.
Previous wording
Net charge-offs increased $2 million year-over-year. As noted, economic trends such as interest rates, unemployment, volatility in commodity prices, collateral valuations and inflationary pressure will impact the future levels of net charge-offs and may result in volatility of certain credit metrics in 2025 and beyond.
Current wording
Net charge-offs increased $14 million year-over-year. As noted, economic trends such as interest rates, unemployment, volatility in commodity prices, collateral valuations and inflationary pressure will impact the future levels of net charge-offs and may result in volatility of certain credit metrics in 2025 and beyond.
Previous wording
(2)Excludes residential first mortgage loans that are 100% guaranteed by the FHA and all guaranteed loans sold to Ginnie Mae where Regions has the right but not the obligation to repurchase. Total 90+ days or more past due guaranteed loans excluded were $53 million at March 31, 2025 and $55 million at December 31, 2024.
Current wording
(2)Excludes residential first mortgage loans that are 100% guaranteed by the FHA and all guaranteed loans sold to Ginnie Mae where Regions has the right but not the obligation to repurchase. Total 90+ days or more past due guaranteed loans excluded were $44 million at June 30, 2025 and $55 million at December 31, 2024.
Previous wording
Non-performing loans at March 31, 2025 decreased $59 million as compared to year-end 2024 levels. The same economic trends that impact net charge-offs, as discussed above, will impact the future level of non-performing loans. Circumstances related to individually large credits could also result in volatility.
Current wording
Non-performing loans at June 30, 2025 decreased $136 million as compared to year-end 2024 levels primarily due to reductions in the industries or property types of information, healthcare, apartments and office, partially offset by an increase in energy. The same economic trends that impact net charge-offs, as discussed above, will impact the future level of non-performing loans. Circumstances related to individually large credits could also result in volatility.
Previous wording
Deposits are Regions’ primary source of funds, providing funding for 92 percent of average earning assets at both March 31, 2025 and December 31, 2024. The following table summarizes deposits by category and by segment:
Current wording
Deposits are Regions’ primary source of funds, providing funding for over 90 percent of average earning assets at both June 30, 2025 and December 31, 2024. The following table summarizes deposits by category and by segment:
Previous wording
(1) Other deposits represent non-customer balances primarily consisting of wholesale funding (for example, selected deposits and brokered time deposits). Other deposits include brokered deposits totaling $2.2 billion at both March 31, 2025 and December 31, 2024.
Current wording
(1) Other deposits represent non-customer balances primarily consisting of wholesale funding (for example, selected deposits and brokered time deposits). Other deposits include brokered deposits totaling $2.8 billion at June 30, 2025 and $2.2 at December 31, 2024.
Previous wording
Total deposits at March 31, 2025 increased approximately $3.4 billion across most segments and categories compared to year-end 2024 levels. The increase in deposits reflects typical seasonal tax patterns and customer preference for liquidity in an uncertain economic environment. The mix of non-interest-bearing deposits remained stable at approximately 31 percent of total deposits at both March 31, 2025 and December 31, 2024. Regions' deposits are granular and diversified including insured and collateralized deposits, with consumer deposits making up more than 62 percent of the total deposit base at both March 31, 2025 and December 31, 2024.
Current wording
Total deposits at June 30, 2025 increased approximately $3.3 billion across most segments and categories compared to year-end 2024 levels. The increase in deposits reflects customer growth and preference for liquidity as there remains some uncertainty in the economic environment. The mix of non-interest-bearing deposits remained stable at approximately 31 percent of total deposits at both June 30, 2025 and December 31, 2024. Regions' deposits are granular and diversified including insured and collateralized deposits, with consumer deposits making up more than 60 percent of the total deposit base at both June 30, 2025 and December 31, 2024.
Previous wording
Funding from the FHLB and Federal Reserve Bank is secured by pledged assets, primarily certain loan portfolios which are also subject to blanket lien arrangements with the FHLB and Federal Reserve Bank. As of March 31, 2025, Regions' blanket lien arrangements with these entities covered a total loan balance of approximately $92.6 billion and included loans from various loan portfolios. However, borrowing capacity with the FHLB and Federal Reserve Bank is contingent on a subset of the blanket lien portfolios which are eligible and pledged according to the parameters for each counterparty.
Current wording
Funding from the FHLB and Federal Reserve Bank is secured by pledged assets, primarily certain loan portfolios which are also subject to blanket lien arrangements with the FHLB and Federal Reserve Bank. As of June 30, 2025, Regions' blanket lien arrangements with these entities covered a total loan balance of approximately $93.8 billion and included loans from various loan portfolios. However, borrowing capacity with the FHLB and Federal Reserve Bank is contingent on a subset of the blanket lien portfolios which are eligible and pledged according to the parameters for each counterparty.
Previous wording
Federal banking agencies allowed a phase-in of the impact of CECL on regulatory capital. At December 31, 2021, the add-back to regulatory capital was calculated as the impact of initial adoption, adjusted for 25 percent of subsequent changes in the allowance. The amount was phased-in over a three-year period beginning in 2022 and concluded in the first quarter of 2025. At December 31, 2024, the net impact of the add-back on CET1 was approximately $102 million or approximately 8 basis points; this amount was zero at March 31, 2025.
Current wording
Federal banking agencies allowed a phase-in of the impact of CECL on regulatory capital. At December 31, 2021, the add-back to regulatory capital was calculated as the impact of initial adoption, adjusted for 25 percent of subsequent changes in the allowance. The amount was phased-in over a three-year period beginning in 2022 and concluded in the first quarter of 2025. At December 31, 2024, the net impact of the add-back on CET1 was approximately $102 million or approximately 8 basis points.
Previous wording
Shareholders’ equity was $18.5 billion at March 31, 2025 as compared to $17.9 billion at December 31, 2024. During the first three months of 2025, net income increased shareholders' equity by $490 million, cash dividends on common stock reduced shareholders' equity by $226 million, and cash dividends on preferred stock reduced shareholders' equity by $25 million. Changes in OCI increased shareholders' equity by $636 million, primarily due to available for sale securities and derivative instruments as a result of changes in market interest rates during the three months ended March 31, 2025. Common stock repurchased during the first three months of 2025 decreased shareholders' equity by $242 million. These shares were immediately retired upon repurchase and therefore were not included in treasury stock.
Current wording
Shareholders’ equity was $18.7 billion at June 30, 2025 as compared to $17.9 billion at December 31, 2024. During the first six months of 2025, net income increased shareholders' equity by $1.1 billion, cash dividends on common stock reduced shareholders' equity by $450 million, and cash dividends on preferred stock reduced shareholders' equity by $50 million. Changes in OCI increased shareholders' equity by $952 million, primarily due to available for sale securities and derivative instruments as a result of changes in market interest rates during the six months ended June 30, 2025. During the second quarter of 2025, the Company redeemed all of the outstanding shares of its Series D preferred stock, which decreased shareholders' equity by $350 million. Common stock repurchased during the first six months of 2025 decreased shareholders' equity by $386 million. These shares were immediately retired upon repurchase and therefore were not included in treasury stock.
Previous wording
Total equity was $18.6 billion at March 31, 2025 as compared to $17.9 billion at December 31, 2024, which included noncontrolling interest of $37 million and $31 million during the periods, respectively. The noncontrolling interest represents the unowned portion of a low income housing tax credit fund syndication, of which Regions held the majority interest at March 31, 2025 and December 31, 2024.
Current wording
Total equity included noncontrolling interest of $40 million and $31 million at June 30, 2025 and December 31, 2024, respectively. The noncontrolling interest represents the unowned portion of a low income housing tax credit fund syndication, of which Regions held the majority interest at June 30, 2025 and December 31, 2024.
Showing the first 40 of 68 pairs. Open the source sections for the rest.
Rearranged current paragraphs (8)
Current report — wording carried from elsewhere
(1)Amounts have been calculated using whole dollar values and the prevailing interest accrual methodology.
Current report — wording carried from elsewhere
(2)Debt securities are included on an amortized cost basis with yield and net interest margin calculated accordingly.
Current report — wording carried from elsewhere
(3)Interest income on debt securities includes hedging income of $8 million and $4 million for the six months ended June 30, 2025 and 2024, respectively.
Current report — wording carried from elsewhere
(4)Loans, net of unearned income include non-accrual loans for all periods presented.
Current report — wording carried from elsewhere
(5)Interest income on loans, net of unearned income, includes hedging expense of $127 million and $233 million for the six months ended June 30, 2025 and 2024, respectively. Interest income on loans, net of unearned income, also includes net loan fees of $61 million and $69 million for the six months ended June 30, 2025 and 2024 , respectively.
Current report — wording carried from elsewhere
(6)Total deposit costs 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 equaled 1.39% and 1.58% for the six months ended June 30, 2025 and 2024, respectively.
Current report — wording carried from elsewhere
(7)The computation of taxable-equivalent net interest income is based on the statutory federal income tax rate of 21%, adjusted for applicable state income taxes net of the related federal tax benefit.
Current report — wording carried from elsewhere
Subsequent to June 30, 2025, $2.0 billion in forward-starting receive-fixed interest rate swaps (floating rate loan hedges) beginning in January 2028 and maturing in January 2033 were added at an average receive rate of 3.7 percent.
Rearranged previous paragraphs (3)
Previous report — wording carried elsewhere
Non-performing loans, excluding held for sale, decreased approximately $85 million compared to the fourth quarter of 2024. The decrease in non-performing loans was primarily due to charge-offs in previously identified portfolios of interest. The decrease in non-performing loans therefore resulted in a decline in specific reserves in the first quarter. See Table 11 for more details regarding non-performing assets.
Previous report — wording carried elsewhere
The combined results from portfolio changes, credit metrics, and specific reserves was a net decrease to the allowance.
Previous report — wording carried elsewhere
Subsequent to March 31, 2025, the Company added $748 million in spot-starting pay-fixed interest rate swaps (available for sale securities hedges) with an average pay rate of 3.6 percent and an average maturity in 2032 to reduce AOCI volatility in the available for sale securities portfolio. As a partial offset to the interest rate risk associated with these pay-fixed fair value hedges, the Company added $500 million in receive-fixed interest rate swaps (floating rate loan hedges) with an average receive rate of 3.4 percent and an average maturity in 2032.