Regions Financial reports 80% net income decline

Regions Financial Corp. this morning reported an 80 percent decline in third-quarter profit as it set aside more than $400 million for loan losses.

Net income for the quarter was $79.5 million, or 11 cents per share, compared to $394.2 million, or 56 cents per share, in third-quarter 2007, according to a news release.

Regions increased its provision for loan losses to $417 million in the quarter, up from $90 million set aside in the same quarter last year.

Also during the quarter, the bank either sold or transferred to hold for sale about $430 million in nonperforming loans and foreclosed properties. Losses on those transactions totaled $186 million. Total third-quarter net loan charge-offs rose to $416 million, or 1.68 percent of average loans, and home equity net loan charge-offs were an annualized 1.59 percent of average loans and lines, compared to 1.94 percent a year ago.

Average loans grew an annualized 5 percent in the quarter. Return on average assets fell to .22 percent from 1.14 percent a year ago, and return on average tangible equity fell to 4.2 percent from 20.14 percent a year ago.

Regions shares (NYSE: RF) closed Monday at $10.64 and were trading up at $11.17 as of 11:15 a.m. today. The 52-week range is $6.41 to $27.50.[[In-content Ad]]