Regions Financial 3Q14 Earnings Call Notes

posted in: Notes | 0

This post is part of a series of posts called “Company Notes.” These posts contain quotes and exhibits from earnings calls, conference presentations, analyst days and SEC filings. Full transcripts can be found at Seeking Alpha

Saw loan demand pick back up in September and continue to strengthen into 4Q

“we saw a moderation of loan demand in the July and August and then we saw loan demand strengthen to some degree in September. We continue to see that strengthening of loan demand into the fourth quarter.”

5 million customers

“we are servicing a little over four million households today. We have about a little over five million customers. ”

Small business formation has been down this year

“let’s take owner-occupied real estate. That generally is our small business customer. And small business formation has been down in 2014 quite a bit. And we really need to see and want to see the demand from that customer. It is our bread and butter.”

The economy is improving

“I think that, we are seeing the opportunity to grow our business. We are seeing in the markets we operate in, given the strengths of the market that we operate in, we believe we have got an opportunity to grow our business. And we do believe that while the economy is improving slowly, it still is improving. And we are seeing signs of that improvement across all of our markets.”

Third quarter was slower, but we’re optimistic

“I think the third quarter was slower, from a loan demand, than we had anticipated. But if the trend continues, we are more optimistic for the fourth quarter, knowing what we know today. So all that being said, as optimistic as we all are, we still have to be prudent and I think that we have to have this balanced approach to both investing to grow but looking for efficiencies around the company that allow us to, if you will be, to be able to hedge that forecast.”

slower loan growth may also be due to the credit culture we’ve tried to build

“I think also given what this organization has gone through over the past several years, we are just very disciplined, very prudent about credit underwriting at this juncture. And so we would attribute part of our differential between some of the peers to be the credit culture that we have tried to build at this company.”

P2P lenders inexplicably get to play by a different set of rules

“we have every one of these, if you will, technology based lending solutions, whether its peer-to-peer or whether it’s just that an origination position. We have taken a hard look at every one of them and I think it’s a good question. Quite frankly, we have got a number of competitors, that their rules of engagement are different than ours. And so you know today in our environment some of that type of lending, I just think we have to stay away from.”

A lot of funding products are moving out of the traditional banking space

“But a lot of financial products are moving out of the traditional banking space and we have got to learn to compete with them but compete under the rules that we operate under.”