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Regions’ Wealth Management Business Posts Strong Growth in 1Q15

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Nov. 20 2020, Updated 2:48 p.m. ET

Focus on Wealth Management

Regions Financial’s (RF) Wealth Management revenue increased 10% YoY (year-over-year)—driven by higher insurance commissions, higher investment services fees, and increases in investment management and trust income. Compared to the previous quarter, assets under administration increased 5%.

You can read more about Regions Financial’s wealth management business in Regions Financial’s 3 operating segments. Regions Financial forms ~1.3% of the SPDR S&P Regional Banking ETF’s (KRE) portfolio.

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Going forward, the bank intends to focus on growing its wealth management business. During the first quarter earnings call, Regions Financial’s CEO Grayson Hall said, “Going forward, along with organic growth, we will continue to target lift-out and acquisition opportunities in this important business. This will also allow us to round out our product offerings and geographic coverage and will drive incremental revenue growth.”

Insurance revenue grows

Insurance revenue increased 17% YoY in the quarter. The bank’s insurance products include property, casualty, life, health, and accident. The business offers credit-related products like debt cancellation, environmental insurance, crop insurance, and mortgage insurance.

The investment services fee income increased 20% in the quarter—compared to the same quarter last year. The above graph shows the growth in Regions Financial’s wealth management and other non-interest income.

SunTrust Bank (STI), BB&T (BBT), and large banks like Bank of America (BAC) all offer wealth management services in the southeastern region— Region Financial’s primary area of operation.

Non-interest income grows

Non-interest income rose 3% YoY. Service charges on deposit accounts declined 7% YoY due to product discontinuation in 4Q14. While card and ATM fees grew 8% YoY in the quarter, mortgage income remained flat.

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