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Name | Symbol | Market | Type |
---|---|---|---|
Regions Financial Corporation | NYSE:RF-E | NYSE | Preference Share |
Price Change | % Change | Price | High Price | Low Price | Open Price | Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
-0.10 | -0.54% | 18.41 | 18.67 | 18.36 | 18.60 | 48,132 | 21:32:04 |
Per Depositary Share | Total | ||
Public offering price | $25.0000 | $500,000,000.00 | |
Underwriting discounts(1) | $0.4929 | $9,859,000.00 | |
Proceeds to Regions Financial Corporation, before expenses | $24.5071 | $490,141,000.00 |
Morgan Stanley | BofA Securities | Goldman Sachs & Co. LLC | J.P. Morgan | RBC Capital Markets | Regions Securities LLC |
Academy Securities | Blaylock Van, LLC | Ramirez & Co., Inc. | R. Seelaus & Co., LLC |
Page | |
SUMMARY | |
CAPITALIZATION | |
Earnings Summary | Quarter Ended | ||||
($ amounts in millions) | 6/30/2024 | 3/31/2024 | 6/30/2023 | ||
Net interest income | $1,186 | $1,184 | $1,381 | ||
Provision for credit losses | 102 | 152 | 118 | ||
Net interest income after provision for credit losses | 1,084 | 1,032 | 1,263 | ||
Non-interest income | 545 | 563 | 576 | ||
Non-interest expense | 1,004 | 1,131 | 1,111 | ||
Income tax expense | 124 | 96 | 147 | ||
Net income | 501 | 368 | 581 | ||
Preferred dividends | 24 | 25 | 25 | ||
Net income available to common shareholders | $477 | $343 | $556 | ||
Diluted earnings per common share | $0.52 | $0.37 | $0.59 | ||
Balance Sheet Summary | |||||
($ amounts in millions) | 6/30/2024 | 3/31/2024 | 6/30/2023 | ||
At quarter-end: | |||||
Cash and due from banks | $2,955 | $2,527 | $2,480 | ||
Interest-bearing deposits in other banks | $5,524 | $8,723 | $7,406 | ||
Debt securities held to maturity | $733 | $743 | $777 | ||
Debt securities available for sale | $28,537 | $27,881 | $27,296 | ||
Loans held for sale | $552 | $417 | $554 | ||
Loans, net of unearned income | $97,508 | $96,862 | $99,191 | ||
Allowance for credit losses | $(1,621) | $(1,617) | $(1,513) | ||
Non-interest-bearing deposits | $40,927 | $41,824 | $46,898 | ||
Interest-bearing deposits | $85,689 | $87,158 | $80,061 | ||
Short-term borrowings | $513 | $1,000 | $3,000 | ||
Long-term borrowings | $5,083 | $3,327 | $4,293 | ||
Total shareholders’ equity | $17,169 | $17,044 | $16,639 | ||
Average balances: | |||||
Loans, net of unearned income | $97,281 | $97,420 | $98,581 | ||
Total deposits | $126,901 | $127,126 | $125,539 |
Issuer | Regions Financial Corporation, a Delaware corporation and a financial holding company. |
Securities Offered | 20,000,000 depositary shares each representing a 1/40th ownership interest in a share of our Non-Cumulative Perpetual Preferred Stock, Series F, par value $1 per share, with a liquidation preference of $1,000 per share of Preferred Stock (equivalent to $25 per depositary share). Each holder of depositary shares will be entitled, through the depositary, in proportion to the applicable fraction of a share of Preferred Stock represented by such depositary shares, to all the rights and preferences of the Preferred Stock represented thereby (including dividend, voting, redemption and liquidation rights). We reserve the right to re-open this series of preferred stock and issue additional shares of Preferred Stock either through public or private sales at any time and from time to time without notice to or consent of holders of the Preferred Stock or the depositary shares; provided that any such additional shares of Preferred Stock are treated as fungible with the Preferred Stock offered hereby for U.S. federal income tax purposes. The additional shares would form a single series together with all previously issued shares of Preferred Stock. In the event we issue additional shares of Preferred Stock, we expect to cause a corresponding number of additional depositary shares to be issued. |
Dividends | We will pay dividends on the Preferred Stock, when, as, and if declared by our board of directors (or a duly authorized committee thereof ). Dividends on the Preferred Stock will accrue on the stated amount of $1,000 per share of Preferred Stock at a fixed rate per annum equal to (i) 6.95% from the original issue date of the Preferred Stock to, but excluding, the dividend payment date on September 15, 2029 (the “First Reset Date”) and (ii) the five-year treasury rate as of the most recent reset dividend determination date (as defined under “Description of the Series F Preferred Stock—Dividends”) plus 2.771%, during each reset period, from, and including, the First Reset Date. See “Description of the Series F Preferred Stock—Dividends.” Upon payment of any dividends on the Preferred Stock, holders of depositary shares are expected to receive a proportionate payment. See “Description of Depositary Shares —Dividends and Other Distributions.” Dividends on the Preferred Stock will not be cumulative and will not be mandatory. If our board of directors (or a duly authorized committee thereof ) does not declare a dividend on the Preferred Stock in respect of a dividend period, then no dividend shall be deemed to have accrued for such dividend period, no dividend shall be payable on the applicable dividend payment date, and we will have no obligation to pay any dividend for that dividend period, whether or not our board of directors (or a duly authorized committee thereof ) declares a dividend for any future dividend period with respect to the Preferred Stock or at any future time with respect to any other class or series of our capital stock. A “dividend period” is the period from, and including, a dividend payment date to, but excluding, the next dividend payment date, except that the initial dividend period for shares of Preferred Stock issued in connection with this offering will begin on and include the date we first issue such shares of Preferred Stock. Our ability to pay dividends on the Preferred Stock is subject to certain legal, regulatory and other restrictions described under “Description of the Series F Preferred Stock—Dividends—Restrictions on the Payment of Dividends.” |
Dividend Payment Dates | Dividends on the Preferred Stock will be payable when, as, and if declared by our board of directors (or a duly authorized committee thereof ), quarterly on March 15, June 15, September 15 and December 15 of each year, beginning on September 15, 2024 (each a “dividend payment date”). If any dividend payment date falls on a day other than a business day, then such date shall nevertheless be a dividend payment date but any dividend declared and otherwise payable on that dividend payment date will instead be paid on the next business day without any adjustment to the amount of dividends paid. |
Priority Regarding Dividends | So long as any shares of Preferred Stock remain outstanding, unless full dividends for the most recently completed dividend period have been declared and paid (or declared and a sum sufficient for the payment thereof has been set aside) on all outstanding shares of Preferred Stock, and we are not in default on our obligation to redeem any shares of Preferred Stock that have been called for redemption, we may not, subject to certain exceptions: •declare, pay or set aside for payment any dividend or distribution on any shares of junior stock (as defined herein); or •repurchase, redeem or otherwise acquire for consideration, directly or indirectly, any shares of junior stock or dividend parity stock (as defined herein). When dividends are not paid in full upon the Preferred Stock and any dividend parity stock (which currently includes our 6.375% Fixed-to- Floating Rate Non-Cumulative Perpetual Preferred Stock, Series B (“Series B Preferred Stock”), 5.700% Fixed-to-Floating Rate Non- Cumulative Perpetual Preferred Stock, Series C (“Series C Preferred Stock”), Non-Cumulative Perpetual Preferred Stock, Series D (“Series D Preferred Stock”) and 4.45% Non-Cumulative Perpetual Preferred Stock, Series E (“Series E Preferred Stock”), all dividends paid or declared for payment on a dividend payment date with respect to the Preferred Stock and any dividend parity stock will be shared based on the ratio between the then-current dividends due on shares of Preferred Stock and (i) in the case of any series of non-cumulative dividend parity stock, the aggregate of the current and unpaid dividends due on such series of preferred stock and (ii) in the case of any series of cumulative dividend parity stock, the aggregate of the current and accumulated and unpaid dividends due on such series of preferred stock. See “Description of the Series F Preferred Stock—Dividends—Priority Regarding Dividends” for more information. |
Redemption | The Preferred Stock is perpetual and has no maturity date. We may redeem the Preferred Stock, at our option, at a price equal to $1,000 per share (equivalent to $25 per depositary share), plus any declared and unpaid dividends (without accumulation for any undeclared dividends) to but excluding the redemption date, (i) in whole or in part, from time to time, on any dividend payment date on or after September 15, 2029 or (ii) in whole but not in part, at any time following a regulatory capital treatment event. If we redeem the Preferred Stock, the depositary is expected to redeem a proportionate number of depositary shares. See “Description of the Series F Preferred Stock—Redemption” and “Description of Depositary Shares—Redemption” for more information. Our ability to redeem part or all of the Preferred Stock is subject to certain legal, regulatory and other restrictions described under “Description of the Series F Preferred Stock—Redemption— Redemption Procedures and Limitations.” Neither the holders of Preferred Stock nor holders of depositary shares will have the right to require the redemption or repurchase of the Preferred Stock. |
Liquidation Rights | In the event we liquidate, dissolve or wind-up our business and affairs, either voluntarily or involuntarily, holders of the Preferred Stock are entitled to receive a liquidating distribution of $1,000 per share (equivalent to $25 per depositary share), plus any declared and unpaid dividends (without regard to any undeclared dividends) to the date of payment of the liquidating distribution, before we make any distribution of assets to the holders of our common stock or any other class or series of shares ranking junior to the Preferred Stock with respect to liquidating distributions. Distributions will be made only to the extent of our assets that are available after satisfaction of all liabilities or obligations to creditors and subject to the rights of holders of any securities ranking senior to the Preferred Stock as to such distribution and pro rata as to the Preferred Stock and any other shares of our capital stock ranking equally as to such distribution, which currently includes our Series B Preferred Stock, Series C Preferred Stock, Series D Preferred Stock and Series E Preferred Stock. |
Voting Rights | None, except with respect to (i) authorizing or increasing the authorized amount of any class or series of our capital stock ranking senior to the Preferred Stock with respect to the payment of dividends or distributions upon our liquidation, dissolution or winding-up, (ii) certain changes in the terms of our Preferred Stock, (iii) the consummation of certain mergers, consolidations or other similar transactions, (iv) in the case of certain dividend non-payments, and (v) as otherwise required by law. See “Description of the Series F Preferred Stock—Voting Rights.” Holders of depositary shares must act through the depositary to exercise any voting rights, as described under “Description of Depositary Shares —Voting the Preferred Stock.” |
Ranking | Shares of the Preferred Stock will rank, with respect to the payment of dividends and distribution upon our liquidation, dissolution or winding- up, respectively: •senior to our common stock and to each other class or series of our capital stock issued in the future, unless the terms of that stock expressly provide that it ranks senior to, or on parity with, the Preferred Stock with respect to such dividends and distributions; •on a parity with our Series B Preferred Stock, Series C Preferred Stock, Series D Preferred Stock, Series E Preferred Stock and any class or series of our capital stock issued in the future, the terms of which expressly provide that it will rank on a parity with our Preferred Stock with respect to such dividends and distributions; and •junior to any class or series of our capital stock issued in the future, the terms of which expressly provide that such stock will rank senior to the Preferred Stock with respect to such dividends and distributions. |
No Maturity | The Preferred Stock does not have any maturity date, and we are not required to redeem the Preferred Stock at any time. Accordingly, the Preferred Stock will remain outstanding indefinitely, unless and until we decide to redeem it and, if required, receive prior approval of the Board of Governors of the Federal Reserve System (the “Federal Reserve”) to do so. |
Preemptive and Conversion Rights | None. |
Listing | Application will be made to list the depositary shares on the NYSE under the symbol “RFPrF.” If approved for listing, trading of the depositary shares on the NYSE is expected to commence within a 30- day period after the original issuance date of the depositary shares. |
Tax Consequences | For discussion of the tax consequences relating to the Preferred Stock and the depositary shares, see “United States Federal Income Tax Consequences.” |
Use of Proceeds | We estimate that the net proceeds of this offering, after deducting the underwriting discounts and estimated offering expenses payable by us, will be approximately $488,441,000. We expect to use the net proceeds from the sale of the Preferred Stock to redeem all outstanding shares of the Series B Preferred Stock and to use any remaining proceeds for general corporate purposes. |
Risk Factors | See “Risk Factors” beginning on page S-8 of this prospectus supplement and other information included or incorporated by reference in this prospectus supplement and the accompanying prospectus for a discussion of factors you should consider carefully before deciding to invest in the depositary shares. |
Registrar and Transfer Agent | Broadridge Financial Solutions, LLC. will be the transfer agent and the registrar for the Preferred Stock, and the registrar and the transfer agent for the depositary shares. |
Depositary | Broadridge Financial Solutions, LLC. |
Calculation Agent | We will appoint a calculation agent for the Preferred Stock prior to the third business day immediately preceding the First Reset Date. We may appoint ourselves or an affiliate of ours as calculation agent. |
Conflicts of Interest | Regions Securities LLC, our subsidiary, is participating in this offering of depositary shares as an underwriter. Accordingly, this offering is being conducted in compliance with the provisions of FINRA Rule 5121. Regions Securities LLC is not permitted to sell the depositary shares in this offering to an account over which it exercises discretionary authority without the prior specific written approval of the customer to which the account relates. |
June 30, 2024 | |||
Actual | As Adjusted | ||
(Dollars in Millions) | |||
Long-term debt(1): | |||
Regions Financial Corporation | |||
Senior Notes: | |||
5.722% senior notes due 2030 | $746 | $746 | |
1.80% senior notes due 2028 | 647 | 647 | |
2.25% senior notes due May 2025 | 749 | 749 | |
Subordinated Notes: | |||
7.75% subordinated notes due September 2024 | 100 | 100 | |
6.75% subordinated debentures due November 2025 | 151 | 151 | |
7.375% subordinated notes due December 2037 | 298 | 298 | |
Valuation adjustments on hedged long-term debt | (106) | (106) | |
Regions Bank(2) | |||
Subordinated Notes: | |||
6.45% subordinated notes due June 2037 | 496 | 496 | |
FHLB advances | 2,000 | 2,000 | |
Other long-term debt | 2 | 2 | |
Total Long-Term Debt | $5,083 | $5,083 | |
Shareholders’ Equity: | |||
Series B Preferred Stock(3) | $433 | $— | |
Series C Preferred Stock | 490 | 490 | |
Series D Preferred Stock | 346 | 346 | |
Series E Preferred Stock | 390 | 390 | |
Series F Preferred Stock | — | 488 | |
Common stock | 10 | 10 | |
Additional paid-in capital | 11,575 | 11,523 | |
Retained earnings | 8,561 | 8,546 | |
Treasury stock, at cost | (1,371) | (1,371) | |
Accumulated other comprehensive income (loss), net | (3,265) | (3,265) | |
Total shareholders’ equity | $17,169 | $17,157 | |
Total Capitalization | $22,252 | $22,240 |
As of June 30, 2024 | |||
Actual | As Adjusted for this Offering | ||
(dollars in millions) | |||
Common equity tier 1 capital | $13,093 | $13,026 | |
Additional tier 1 capital | $1,659 | $1,714 | |
Tier 2 capital | $2,397 | $2,397 | |
Total capital | $17,149 | $17,137 | |
Common equity tier 1 capital ratio | 10.4% | 10.4% | |
Tier 1 capital ratio | 11.7% | 11.7% | |
Total capital ratio | 13.6% | 13.6% | |
Tier 1 leverage ratio | 9.8% | 9.8% |
Underwriter | Number of Depositary Shares | |
Morgan Stanley & Co. LLC | 3,200,000 | |
BofA Securities, Inc. | 3,200,000 | |
Goldman Sachs & Co. LLC | 3,200,000 | |
J.P. Morgan Securities LLC | 3,200,000 | |
RBC Capital Markets, LLC | 3,200,000 | |
Regions Securities LLC | 3,200,000 | |
Academy Securities, Inc. | 200,000 | |
Blaylock Van, LLC | 200,000 | |
Samuel A. Ramirez & Company, Inc. | 200,000 | |
R. Seelaus & Co., LLC | 200,000 | |
Total | 20,000,000 |
Underwriting Fee(1) | |
Per Depositary Share | $0.4929 |
Total | $9,859,000.00 |
Title of each Class of Securities to be Registered | Amount to Be Registered | Proposed Maximum Offering Price Per Unit | Proposed Maximum Aggregate Offering Price | Amount of Registration Fee(1) | ||||||||||
Depositary Shares each representing a 1/40th interest in a share of Non-Cumulative Perpetual Preferred Stock, Series F | 20,000,000.00 | $ | 25.00 | $ | 500,000,000.00 | $ | 73,800.00 | |||||||
Non-Cumulative Perpetual Preferred Stock, Series F | (2) | (2) | (2) | (2) | ||||||||||
1 Year Regions Financial Chart |
1 Month Regions Financial Chart |
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