Regions Financial in Birmingham, Ala., was still able to increase quarterly profit despite costs tied to branch closures.
The $126 billion-asset company reported on Friday that its fourth-quarter net income rose 4% from a year earlier to $279 million, or 23 cents a share.
Net interest income rose 5% to $805 million, reflecting higher interest rates and a shift to higher-yielding consumer loans. The average yield on all loans rose 17 basis points to 3.91%.
Noninterest income rose 2% to $522 million. Higher income from mortgages, deposit-service charges, and card and ATM fees were offset by lower income from affordable-housing investments. Regions' capital-markets income rose 11% to $3 million on a higher level of debt underwriting. Regions' balance of indirect auto loans fell $17 million after it terminated a partnership with an unidentified third party that had represented half its indirect auto-lending volume. Regions did not provide a reason for ending the partnership.
Noninterest expense rose 3% to $899 million. Costs to shutter branches rose 183% to $17 million; Regions closed 100 branches and drive-through facilities over the prior 12 months. Personnel costs fell 1% to $472 million due to the elimination of about 1,200 jobs and a reduction of incentive-based compensation.
