Regions Financial (NYSE:RF) reported third-quarter 2026 net income of $611 million, or $0.71 per share, while adjusted earnings totaled $622 million, or $0.73 per share. The company reported adjusted pre-tax, pre-provision income of $870 million and an adjusted return on tangible common equity of 22%.
Chairman, President and CEO John Turner said the quarter reflected continued customer engagement, investments in talent and technology, and strength in the company’s credit and fee-based businesses. He said Regions continued to grow consumer households and checking accounts, while commercial clients remained active in business, technology and long-term investments.
Loan growth moderated, with commercial activity still strong
CFO Anil Chadha said both average and ending loan balances increased modestly from the second quarter, though growth slowed from the pace seen in the first half of the year. Growth was driven by commercial lending, including government and public-sector lending and wholesale and financial-services clients.
Loan growth remained concentrated among investment-grade commercial borrowers, although Regions said production trends were healthy in emerging commercial and middle-market businesses following recent hiring investments. Consumer loan balances declined modestly as growth in credit card and home equity balances was offset by softer residential mortgage and home-improvement financing activity.
Regions maintained its outlook for average loans to rise by a low-single-digit percentage in 2026 compared with 2025. Turner said third-quarter production rose about $4 billion year over year, representing a 60% increase. He added that businesses were continuing to invest and expressed a generally positive view of the economy.
The company did note that higher rates were affecting investor real estate activity. Turner said new activity in that portfolio was slowing because rising costs made transaction economics more difficult, though multifamily lending continued to benefit from previously committed projects that were funding.
Margin improvement expected to continue in fourth quarter
Net interest income increased 2% from the prior quarter, while net interest margin rose 2 basis points to 3.68%. Interest-bearing deposit costs increased just 1 basis point to 1.70% during the quarter.
Chadha said Regions expects interest-bearing deposit beta to remain in the mid- to high-30% range through the current rising-rate cycle. The company expects fourth-quarter net interest income to increase between 1% and 2%, assuming the next Federal Reserve rate increase occurs in December. Regions expects fourth-quarter net interest margin to be about 3.70%.
The company cited several factors supporting the outlook, including fixed-rate asset repricing, deposit-cost discipline, balance-sheet growth and a seasonal HR asset dividend. During the third quarter, yields on newly originated fixed-rate assets were about 100 basis points above yields on maturities. Regions expects that repricing advantage to expand to between 100 and 125 basis points in the fourth quarter.
Deposits declined modestly during the quarter, primarily because several large commercial customers used institutional investment services for specific strategies and because of seasonal public-funds outflows. Regions said it manages about $16 billion of excess commercial client balances through liquid off-balance-sheet investment products. Still, commercial non-interest-bearing balances increased, and small-business account openings reached their highest year-to-date level in a decade, excluding the pandemic period.
Regions expects average deposits for 2026 to increase by a low-single-digit percentage from the prior year. Turner said the company is prioritizing customer acquisition and operational account growth rather than using pricing as its primary deposit-growth strategy.
Record capital markets and treasury management revenue
Adjusted non-interest income increased 3% from the second quarter, supported by record revenue in capital markets and treasury management, as well as higher commercial credit fees, bank-owned life insurance income and other non-interest income. Those gains were partly offset by a $28 million decline in the market value of employee benefit assets.
Capital markets income increased 23% from the previous quarter, driven by stronger merger-and-acquisition advisory work, securities underwriting and placement fees, commercial swap income and syndications revenue. Regions expects fourth-quarter capital markets revenue between $90 million and $105 million, with client activity and market conditions determining where results fall within that range.
Wealth management revenue declined from record second-quarter levels but remained above the prior-year period. Turner said the company still expects to finish 2026 with a record year in wealth management.
For the full year, Regions continues to expect adjusted non-interest income growth of 3% to 5% from 2025, with results tracking toward the lower end of that range.
Credit metrics improved and capital remained above target
Credit quality strengthened during the quarter. Annualized net charge-offs fell 13 basis points from the previous quarter to 29 basis points of average loans. The business-services criticized ratio declined 30 basis points to 4.71%, while the nonperforming loan ratio fell 8 basis points to 59 basis points. The allowance for credit losses ratio declined 2 basis points to 1.61%.
Regions continues to expect full-year net charge-offs of 40 to 50 basis points, now trending toward the lower end of that range. Turner said the company expects credit conditions to remain stable, though it continues to monitor multifamily exposure in Texas, as well as office and transportation portfolios.
The company ended the quarter with an estimated common equity Tier 1 ratio of 10.8%. Including the impact of accumulated other comprehensive income and proposed Basel III endgame risk-weighted asset changes, Regions estimated its CET1 ratio at about 10%, above its stated target range of 9.25% to 9.75%.
During the quarter, Regions repurchased $95 million of shares and paid $255 million in common dividends. Chadha said the company generates roughly 50 basis points of capital per quarter and remains positioned to invest in growth while returning capital to shareholders when appropriate.
Technology conversion remains on schedule for 2027
Regions said it is making progress on its cloud-based deposit platform and broader modernization program. Turner described the initiative as one of the company’s largest technology projects and said an initial pilot involving associates, friends and family would begin within weeks. A broader pilot is planned for the first quarter of 2027, followed by phased customer conversions through 2027, with completion expected near the end of the second quarter or early in the third quarter.
The company said the platform is expected to provide real-time capabilities and enable faster product and pricing changes. Regions also expects technology spending, including cybersecurity investments related to evolving artificial-intelligence risks, to remain elevated for several years before declining as revenue grows.
About Regions Financial (NYSE:RF)
Regions Financial Corporation (NYSE: RF) is a financial services company headquartered in Birmingham, Alabama. Through its principal subsidiary, Regions Bank, the company provides banking and related financial services to consumers, businesses, and institutions.
Regions offers a range of products and services, including checking and savings accounts, consumer and commercial loans, mortgages, credit cards, treasury and cash-management services, investment and wealth-management solutions, and capital-markets services.
