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Regions Financial in Birmingham, Ala., reported higher third-quarter earnings, as cost cuts offset declines in net interest income and fee income.
October 21
Regions Financial in Birmingham, Ala., reported a lower fourth-quarter profit because interest rates squeezed lending margins and mortgage-related revenue fell.
The $120 billion-asset company's net income fell 11% from a year earlier, to $195 million, or 14 cents per share. Its EPS fell short of the consensus estimate of 20 cents among analysts polled by Bloomberg.
Net interest income fell 1.4% to $820 million, as low interest rates pressured asset yields. The net interest margin fell nine basis points to 3.17%.
Fee income fell 15% to $448 million, as mortgage fees declined from lower gains on loan sales and the decline in the value of Regions' mortgage-servicing portfolio, net of hedging activity, the company said.
Also affecting fee income, Regions' service charges fell 9.7% to $167 million, largely because of an $8 million reserve for customer reimbursements.
Noninterest expenses rose 2.4%, to $969 million, on higher professional, legal and regulatory expenses, and costs to close branches.
