Regions posts 37-cent-per-share 3Q loss

Regions Financial Corp. posted third-quarter losses due mostly to increased provision for loan losses and efforts to improve balance sheet risk levels, the company said today.

The Alabama-based parent company of Regions Bank posted a total third quarter loss of $437 million, or 37 cents per diluted share, compared to a gain of $79 million, or 11 cents per share, in the third quarter of 2008.

In addition to the increased loan loss provisions - the bank allowed for losses of 2.83 percent of total loans in the quarter - the company posted $41 million in branch consolidation costs along with higher professional fees and real estate costs during the quarter.

"The operating environment remains challenging and credit-related costs continue to be elevated," Chairman and CEO Dowd Ritter said in a news release. "However, the economy appears to have bottomed and that bodes well for customers and for us. Regions will continue to aggressively recognize credit problems preparing for the economic recovery."

The release said underlying fundamentals are solid, pointing to a $1.3 billion increase in average low-cost deposits, including a $701 million increase in average noninterest-bearing funds. The bank also opened 270,000 new retail and deposit checking accounts during the quarter, up 29 percent from the same quarter in 2008.

Shares of Regions Financial Corp. (NYSE: RF) closed Tuesday at $5.81, compared to a 52-week range of $2.35 to $12.96.