Regions Financial (RF) in Birmingham, Ala., reported lower first-quarter results as improved credit and lower expenses failed to completely offset a steep decline in mortgage revenue.
The $118 billion-asset company's first-quarter profit rose fell 5% from a year earlier, to $311 million, or 22 cents a share.
Net interest income edged up 2%, to $816 million. Total loans also increased 2%, to $75.7 billion. Commercial loans rose 6.3%, while consumer lending fell 1%. The net interest margin widened by 13 basis points, to 3.26%.
Noninterest income fell 13%, to $438 million, largely because of a decline in mortgage activity. Mortgage-related revenue fell 44% from a year earlier, to $40 million. The company also recorded $2 million in securities gains in the first quarter.
Regions cut it noninterest expense by 3%, to $817 million, even though personnel costs rose slightly. The company benefited from selling some troubled-debt restructurings during the quarter, which lowered its noninterest expense by $35 million.
Regions also had lower legal and professional fees, and it reduced overall branch count by 2% compared to a year earlier.
"We remain focused on controlling expenses and achieving positive operating leverage," Grayson Hall, Regions" chairman, president and chief executive, said in a press release Tuesday.
Credit quality also improved, which helped the bottom line. The loan-loss provision fell 80% from a year earlier, to $2 million. Nonperforming assets fell 31%, to $1.2 billion.
Profit was up 42% from the fourth quarter, though Regions recorded a substantial loan-loss provision at the end of last year.
