Regions Financial’s third quarter results were marked by steady deposit growth and resilience in core banking activities, drawing a positive market reaction. Management credited strong deposit acquisition and retention across consumer and commercial lines as key drivers, with John Turner, CEO, highlighting “top quartile deposit growth and above peer median change in market share.” The company also noted robust non-interest income from wealth management and capital markets, while portfolio shaping efforts—particularly the exit from higher risk lending categories—generated some headwinds for loan growth. Asset quality metrics remained stable, and credit performance exceeded expectations, with Turner emphasizing, “consumer credit quality remains strong, exceeding our expectations.”
Is now the time to buy RF? Find out in our full research report (it’s free for active Edge members).
Regions Financial (RF) Q3 CY2025 Highlights:
- Revenue: $1.92 billion vs analyst estimates of $1.92 billion (1.9% year-on-year growth, in line)
- Adjusted EPS: $0.63 vs analyst estimates of $0.60 (5.8% beat)
- Adjusted Operating Income: $737 million vs analyst estimates of $833.1 million (38.5% margin, 11.5% miss)
- Market Capitalization: $21.33 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Regions Financial’s Q3 Earnings Call
- Ken Usdin (Autonomous Research): asked about the outlook for resolving remaining portfolios of interest and whether any additional asset quality concerns remain. CEO John Turner replied that most charge-offs related to office and transportation, and only telecommunications presented mild elevated risk.
- Scott Siefers (Piper Sandler): questioned if portfolio shaping actions align with credit risk concerns. Turner explained that reductions came from both risk-focused exits and upgrades in stabilized portfolios, emphasizing the company’s disciplined approach.
- Steven Alexopoulos (TD Cowen): requested clarity on net interest margin (NIM) sustainability in various rate environments. CFO David Turner pointed out that prudent hedging and deposit pricing strategies underpin confidence in maintaining a resilient NIM, even with changes in Fed policy.
- John Pancari (Evercore): probed the drivers behind portfolio exits—credit risk versus rate environment. Turner stressed decisions were based on both risk appetite and return potential, indicating that exits were sometimes due to evolving client business models.
- Betsy Graseck (Morgan Stanley): inquired about the impact of maturing certificates of deposit (CDs) on NIM. CFO David Turner noted that upcoming CD repricing is a key driver for margin improvement in the next quarter.
Catalysts in Upcoming Quarters
Looking ahead, the StockStory team will watch (1) the completion of portfolio exits and the resulting shift in loan growth trends, (2) progress on the rollout and adoption of new cloud-based banking platforms, and (3) ongoing deposit growth and client acquisition in both core and priority markets. Additional attention will be given to expense containment and the impact of technology investments on operational efficiency.
Regions Financial currently trades at $24.14, up from $23.34 just before the earnings. Is there an opportunity in the stock?See for yourself in our full research report (it’s free for active Edge members).
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