Regions Financial Corporation, a leading financial services corporation , released its unaudited Financial Supplement for the second quarter of 2025. This document provides critical insight into the company’s financial position and performance during this period. The purpose of this article is to deeply analyze the key financial data presented in the supplement, summarize the company’s performance, and offer insights into its future direction, focusing on revenues, expenses, asset quality, and capital structure.

Key Financial Highlights

Regions Financial Corporation demonstrated mixed performance in the second quarter of 2025, with an increase in net income on one hand, and a slight decrease in interest income on the other. Net income available to common shareholders reached $534 million in Q2 2025, compared to $465 million in Q1 2025, and $477 million in the same quarter last year. This figure reflects an improvement of 14.8% from the previous quarter and 11.9% from the same quarter last year. Diluted earnings per share (EPS) stood at $0.59 in Q2 2025, up from $0.51 in the previous quarter and $0.52 in the same quarter last year. Adjusted diluted EPS (non-GAAP) was $0.60, compared to $0.54 in the previous quarter.

Revenue and Expense Analysis

The company’s total interest income was $1,784 million in Q2 2025, a slight increase from $1,725 million in Q1 2025, but a decrease from $1,762 million in the same quarter last year. Interest income from loans, including fees, constituted the vast majority, totaling $1,377 million in Q2 2025. Total interest expense amounted to $525 million, a slight decrease from $531 million in the previous quarter. Consequently, net interest income was $1,259 million in Q2 2025, up from $1,194 million in the previous quarter.

Rearding non-interest income, there was an overall increase. “Service charges on deposit accounts” slightly decreased from $161 million in the first quarter to $151 million in the second quarter. In contrast, “wealth management income” rose from $129 million to $133 million , and “capital markets income” increased from $80 million to $83 million. Mortgage income showed a significant improvement, jumping from $40 million to $48 million.

Non-interest expenses totaled $1,073 million in Q2 2025, an increase from $1,039 million in the previous quarter. This rise is primarily attributed to an increase in salaries and employee benefits expenses, which reached $658 million compared to $625 million in the first quarter. However, it is important to note that there were some adjustments in salaries and benefits expenses due to market value adjustments related to 401(k) liabilities.

Asset Quality

Regions Financial Corporation’s asset quality remained relatively stable, with minor changes. The provision for credit losses increased to $126 million in Q2 2025, up from $124 million in the previous quarter. The non-performing loans ratio decreased to 0.80% of net loans at the end of Q2 2025, compared to 0.88% at the end of the first quarter. The allowance for credit losses to non-performing loans ratio (excluding loans held for sale) increased to 225% in Q2 2025, from 205% in the previous quarter. It is important to note a slight increase in the net charge-offs as a percentage of average loans, which rose from 0.42% in the same quarter last year to 0.47% in Q2 2025.

Balance Sheet Structure and Capital Performance

As of the end of Q2 2025, the company’s total assets amounted to $159,206 million, a slight decrease from $159,846 million at the end of the previous quarter. Total deposits stood at $130,919 million, a minor decrease from $130,971 million at the end of Q1. Non-interest-bearing deposits constituted 30.7% of total deposits. Loans, net of unearned income, slightly increased to $96,723 million, compared to $95,733 million in the previous quarter.

Common shareholders’ equity totaled $17,297 million at the end of Q2 2025. The Common Equity Tier 1 (CET1) Ratio was estimated at 10.7% , a stable and strong figure reflecting compliance with regulatory requirements. The Tangible Common Equity Ratio (non-GAAP), a non-GAAP measure used to assess capital liquidity, was 7.52%.

Conclusions and Outlook

The Q2 2025 financial supplement presents a picture of a financially stable company, successfully increasing profitability despite a dynamic economic environment. The increase in net income and EPS, alongside some improvement in non-interest income, indicates Regions Financial Corporation’s ability to leverage its business operations. The stability in capital ratios and asset quality performance, despite a slight increase in provision for credit losses, points to cautious risk management.

Regions Financial Corporation appears to continue focusing on controlled growth and the ability to generate revenue from diverse sources. The rise in net interest income, along with growth in capital markets and mortgage income, is a positive indicator. The challenges lie mainly in the changing interest rate environment and the ability to control operating expenses, especially salaries and benefits. Based on the data, Regions Financial Corporation seems well-positioned to address these challenges and continue its growth while maintaining financial stability.