Benefiting from a strong regional economy and a multistate expansion campaign, first-quarter profits at Regions Financial Corp. jumped 17%, to $136 million.

Total loans at the Birmingham, Ala., banking company grew 10%, to $25.5 billion, and deposits grew 6%, to $29.1 billion. Revenues rose 14%, to $502.5 million.

Earnings per share of 61 cents matched the Wall Street consensus.

Carl E. Jones Jr., Regions' president and chief executive officer, pointed to the company's improved efficiency ratio-52.25% in the quarter, compared with 54.93% a year earlier-and its 18.13% return on equity, a 134- basis-point improvement. "The year is off to a great start," he said.

Record mortgage production and double-digit increases in account service charges boosted noninterest revenues 32%, to $143 million.

Mortgages originated by the bank during the quarter doubled from the year earlier, to $1.8 billion. And revenues from service charges jumped 11%, to $44.8 million.

The bank attributed the gains to robust growth in the Southeast.

Analyst Harold R. Schroeder of Keefe, Bruyette & Woods Inc. said mortgage banking, particularly in the South, "has been the business to be in" because of the booming economy.

The $38.6 billion-asset company completed four acquisitions during the quarter, adding a total of $644 million of assets, $433 million of loans, and $573 million of deposits.

Regions bought Meigs County Bancshares in Decatur, Tenn.; VB&T Bancshares in Valdosta, Ga.; Bullsboro BancShares in Newnan, Ga.; and Arkansas Banking Co. of Jonesboro.

The first-quarter results show "the positive impact of those integrations," said Stephen Biggar, an analyst at S&P Equity Group. And more acquisitions are expected this year, he added. "They are making efforts to diversify outside their traditional market." +++

Regions Financial Corp.

Birmingham, Ala.

Dollar amounts in millions (except per share)

First Quarter 1Q99 1Q98

Net income $136.5 $117.1

Per share 0.61 0.52

ROA 1.48% 1.44%

ROE 18.13% 16.79%

Net interest margin 4.23% 4.43%

Net interest income 354.0 326.3

Noninterest income 143.1 108.4

Noninterest expense 262.6 242.0

Loss provision 20.7 14.4

Net chargeoffs 11.5 11.8

Balance Sheet 3/31/99 3/31/98

Assets $38,613.1 $33,925.0

Deposits 29,131.1 27,425.1

Loans 25,540.2 23,235.9

Reserve/nonp. loans 209.34% 209.17%

Nonperf. loans/loans 0.62% 0.67%

Nonperf. assets/assets 0.45% 0.53%

Nonperf. assets/loans + OREO 0.68% 0.78%

Leverage cap. ratio NA NA

Tier 1 cap. ratio NA NA

Tier 1+2 cap. ratio NA NA ===

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