Fee income and higher interest rates boosted fourth-quarter earnings for Regions Financial in Birmingham, Ala., even as lending declined slightly from the year-earlier period.
Net income for the $123 billion-asset Regions totaled $335 million, up 13.5% from the fourth quarter of 2016. Earnings per share were 27 cents, beating the mean of analysts’ estimates by a penny, according to FactSet Research Systems.
Net interest income increased 5.6% to $901 million, and the net interest margin expanded 21 basis points to 3.37%. Total loans declined 1.3% to $79.5 billion in the fourth quarter. Consumer lending was a bright spot, however, as Regions’ point-of-sale consumer lending increased 57.5% to $1.4 billion and its consumer credit card lending increased 8% to $1.2 billion.
Noninterest income rose 6.3% to $555 million. Noninterest income benefited from a $25 million increase in capital markets income generated in part by higher merger and acquisition advisory services and loan syndication income.
Noninterest expenses increased 5.9% to $952 million.
"These results reflect a strong fourth quarter and end to 2017 as our teams made clear progress in executing Regions' strategic plan to deliver greater value for our customers and shareholders," Chairman and CEO Grayson Hall said in a press release Friday that announced the results.
"As we look ahead to our 2018 priorities, we are moving forward with Regions' Simplify and Grow initiative, which will further position Regions for sustainable, long-term growth," Hall said. "As part of this effort, we are conducting a fresh, comprehensive review of the company with the goal of consistently improving the experience customers have with Regions."