Regions Financial Corporation (NYSE:RF) Q2 2016 Earnings Conference Call - Final Transcript

Jul 19, 2016 • 11:00 am ET


Regions Financial Corporation (NYSE:RF) Q2 2016 Earnings Conference Call - Final Transcript


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Good morning, and welcome to the Regions Financial Corporation's Quarterly Earnings Call. My name is Paula, and I'll be your operator for today's call. I would like to remind everyone that all participant phone lines have been placed on listen-only. At the end of the call, there will be a question-and-answer session. (Operator Instructions)

I will now turn the call over to Ms. Dana Nolan to begin.

Dana Nolan

Thank you, Paula. Good morning, and welcome to Regions' second quarter 2016 earnings conference call. Participating on the call are Grayson Hall, Chief Executive Officer; and David Turner, Chief Financial Officer. Other members of senior management are also present and available to answer questions.

A copy of the slide presentation we will reference throughout this call, as well as our earnings release and earnings supplement are available under the Investor Relations section at

(Forward-looking Cautionary Statements) I will now turn the call over to Grayson.

Grayson Hall

Good morning, and thank you for joining our call. Second quarter results reflect continued momentum in [2016] and demonstrate that we are successfully executing on our strategic priorities. We are pleased by our continued progress, despite a challenging and somewhat volatile economic backdrop.

For the second quarter, we reported earnings available to common shareholders of $259 million and earnings per share of $0.20. We continue to deliver results in areas we believe are fundamental to future income growth. We expanded our customer base as we grew checking accounts, households, credit cards and wealth relationships.

Our approach to relationship banking and customer service excellence is instrumental to our success, and we are always pleased to receive external recognition of these efforts. In that regard, the Reputation Institute and the American Banker Magazine recently ranked Regions as the most reputable U.S. bank overall, and for the second consecutive year, the most reputable among customers. We are honored to again receive this top ranking, as it recognizes the efforts of all Regions associates in identifying and meeting the needs of our customers and communities we serve. Another outstanding recognition came from Temkin Group, which ranked Regions among the top 10% of companies that rated in the 2016, as we ranked second in the nation for online experience.

Looking further at our results, we achieved total average loan growth of 4% compared to the prior year. Despite market uncertainty, the overall health of the consumer remains a bright spot. To that end, consumer loans increased 5% year-over-year, with loan balances up in every asset category, and our consumer credit metrics continue to improve. Consumer net charge-offs decreased 5% from the second quarter last year, non-accrual consumer loans decreased 16%, delinquencies decreased 5%, and troubled debt restructured loans decreased 4%. Active credit cards increased 12% year-over-year, while active debit cards increased 4%. Total transactions on cards increased 6% and total spend is up 5%. Further, average consumer deposits were up 3% year-over-year, including savings deposits were up 9%.

Turning to business lending, average loans increased 3% over the prior year. As we indicated