Regions Financial's second-quarter earnings spiked as the Birmingham, Ala., company managed to reduce expenses and problem loans.

Earnings nearly doubled from a quarter earlier and rose more than 400% from a year earlier, to $284 million, mostly because of a 78% decline in the company's loan-loss provision. Nonperforming assets fell 11% from a quarter earlier, to $1.9 billion, marking Regions' lowest level of problematic loans in three years.

"We continued to make incremental progress on many key fronts and are pleased with the improvement of our financial performance despite considerable economic and political uncertainty, and an uneven economic recovery," Grayson Hall, the company's chief executive, said in a press release. "By focusing on initiatives that we can control, we continue to drive sustainable and prudent growth across our business."

The $122 billion-asset company has been expanding in specialized lending and certain retail segments such as credit cards. Average loans in the specialized banking groups grew 4% from a quarter earlier. But consumer loan balances remained low because of low housing prices and continued efforts by customers to reduce personal debt, Regions said.

Loan yields remained flat compared to the first quarter, but Regions managed to lower its cost of funds by 5 basis points. As a result, its net interest margin expanded 7 basis points from the first quarter and 9 basis points from a year earlier, to 3.16%. Net interest income rose 1.3% from a quarter earlier, to $838 million.

Regions also sold brokerage unit Morgan Keegan and exited the Troubled Asset Relief Program during the second quarter. The company said that selling Morgan Keegan added $4 million to net income.

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