Regions Financial in Birmingham, Ala., has been restricted from acquiring other banks or opening new branches after it received a Community Reinvestment Act downgrade.

The Federal Reserve Bank of Atlanta has lowered Regions' CRA rating to "needs to improve" from "satisfactory," citing recent violations of Regulation E, which requires banks to obtain customers' consent to opt in to overdraft protection programs. The Fed informed Regions of the downgrade during the fourth quarter and the $126 billion-asset bank disclosed it in its annual report filed Tuesday.

As a result of the downgrade, Regions is prohibited from making bank acquisitions or filing applications to open new branches until the rating improves. Regions' next CRA exam is scheduled for this year, although a specific date has not been announced.

"We continue to strengthen our commitment to provide financial services and investments to meet the needs of all the communities we serve, and our Community Reinvestment Act exam performance with regard to lending, service and investments reflects those efforts," Jeremy King, a Regions spokesman, said in an emailed statement.

Regions received a "high satisfactory" rating on the other components of its CRA exam last year.

The Consumer Financial Protection Bureau in April placed Regions under a consent order and fined it $7.5 million, claiming it charged overdraft fees to consumers who did not opt in for coverage. Regions also charged fees on accounts that had insufficient funds tied to deposit-advance products, though the bank said it wouldn't do so. The order was the CFPB's first enforcement action against a bank for overdraft violations. Regions discontinued its deposit-advance product and refunded $49 million to about 200,000 customers.

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