Regions Financial Corp. stock surged in heavy volume Tuesday, as rumors continue to surface that the Birmingham, Ala.-based bank is seeking a buyer.

Shares in Regions, which also soared three weeks ago amid heavy trading, rose $2.375 to $48 on volume of 634,600 shares, the third- most-active day for the stock in the past year.

Average daily volume is less than one-sixth that level. Since mid- February, the bank's price has soared 15%.

"We would not be shocked to see this franchise sell given that its earnings per share growth has been less than impressive," said Henry Coffey, a partner with J.C. Bradford & Co.

Earnings growth has been less than 8% annually the last three years, compared to a 10% to 12% average among it peers, he said.

The most common acquirer mentioned amid the current speculation is Wachovia Corp., which has long been rumored to be eyeing the $14 billion- asset company.

But Mr. Coffey, noting that Regions' and Wachovia's territories do not overlap significantly, thinks a merger between the Alabama bank and Atlanta's SunTrust Banks Inc. makes more sense. The operations of Regions and SunTrust overlap significantly in Tennessee and Florida.

Regions did not return calls seeking comment.

If the Regions did sell, the price probably would be in the $53 to $56 per share range, Mr. Coffey said. That would mean a sale price between $2.4 billion and $2.6 billion.

There may be one other explanation for Tuesday's rise in Regions' share price, however. Arbitragers who have short position in Regions in hopes of locking in a profit on its purchase of Gainesville, Ga.-based First National Bancorp may be covering their short positions as the closing date of the deal approaches, said Darren Short, a bank analyst with Robinson- Humphrey Co. At Feb. 15, 869,713 shares of Regions were sold short.

In other market news Tuesday, shares of NationsBank Corp. and BankAmerica Corp. continued their steady rise.

NationsBank rose $2.375 to $78.50, after increasing 87.5 cents Monday. The bank's price is finally catching up to the rest of the large capitalization banks, said Sally Pope Davis, a bank analyst at Goldman, Sachs & Co. Also, investors are less concerned now that the bank will make undisciplined acquisitions, she said.

"There is greater recognition of management discipline and that the stock, even at these levels, is fairly inexpensive," she said.

BankAmerica shares continued a torrid pace, rising $2 to $77.50, the third straight increase of more than $1 per share for the San Francisco- based bank. The bank announced a $3 billion share repurchase program Monday, which exceeded analysts expectations.

Keefe, Bruyette & Woods Inc. research director David Berry, however, downgraded the stock to "accumulate" from "buy," citing the rapid price rise over the last six weeks.

Northern Trust Corp. rose $1.375 to $55.125, after Goldman Sachs reiterated its "buy" rating on the stock Monday.

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