Regions Financial: Growth needs to augment best-in-class ROTCE

Research evidence excerpt

Regions Financial: Growth needs to augment best-in-class ROTCE

%/+2.7% for FY26/27. brandon.berman@bofa.com

Gabriel Angelini

Research AnalystNeed to demonstrate growth potential BofAS

Our Neutral thesis on the stock has been underpinned by the view that management +1 646 855 3081

needs to demonstrate that it can achieve industry-average growth while maintaining a gabriel.angelini@bofa.com

premium ROTCE. To that end, Regions delivered a best-in-class 20% ROTCE for 2Q26 MichaelResearch CamposAnalyst

but a mere 1.2% YoY growth in average earnings assets (lowest among super regional BofAS

+1 646 855 3912

peers, and 2.5% peer average ex. mergers). With a 76% loan/deposit ratio, Regions michael.c.campos@bofa.com

certainly has room to allow loans to outgrow deposits. However, the Street will likely

need to see revenue growth that is at least in line with nominal GDP in order for the

stock to garner investor interest and deliver sustained outperformance. In terms of

Stock Datainorganic growth, mgmt. shot down the potential for engaging in bank M&A in the near

term. Shares trading at 11.0x FY27e EPS vs. 8.8% average EPS growth, 2.1x YE27e Price 31.11 USD

P/TBV vs. 19% avg ROTCE forecast. Price Objective 33.00 USD

Date Established 20-Jul-2026

Estimates (Dec) (US$) 2024A 2025A 2026E 2027E 2028E Investment Opinion B-2-7

EPS 2.13 2.33 2.65 2.82 3.00 52-Week Range 22.70 USD -32.47 USD

GAAP EPS 1.93 2.30 2.65 2.82 3.00 Mrkt Val / Shares Out (mn) 40,350 USD / 1,297.0

EPS Change (YoY) -4.1% 9.4% 13.7% 6.4% 6.4%

Free Float 99.5%

Consensus EPS (Bloomberg) 2.62 2.86 3.14

Consensus EPS (Visible Alpha) 2.63 2.85 3.18 Average Daily Value 342.06 USD

DPS 0.98 1.03 1.13 1.24 1.28 BofA Ticker / Exchange RF / NYS

Bloomberg / Reuters RF US / RF.N

Valuation (Dec) ROE (2026E) 12.9%