Regions Financial Corp., Alabama's biggest bank, said first-quarter profit rose 68%, beating analyst estimates as the lender cuts costs and reduced provisions for loan losses.
Net income climbed to $335 million, or 23 cents a share, from $199 million, or 11 cents, a year earlier, the Birmingham-based lender said Tuesday in a statement. The average estimate of 27 analysts surveyed by Bloomberg was for profit of 20 cents a share.
The biggest U.S. lenders have been cutting costs to generate higher profits as revenue growth stalls. Regions, run by CEO Grayson Hall is focusing on expense management with loan growth in the low-single digits, CFO David Turner told investors last month.
"Building on this foundation while prudently managing expenses, Regions is moving forward to take advantage of growth opportunities in all of our businesses as the economy improves,'' Hall said in the statement.
Mortgage income for the first quarter totaled $72 million, down 20% from the prior quarter.
The bank originated $1.8 billion mortgage loans in the first quarter, down 13% from a year ago. Purchase mortgage applications accounted for almost 50% of loan applications in the first quarter, compared to 35% in the fourth quarter.
“Overall the company continues to benefit for HARP II loan production, as only 20% of all eligible HARP II loans have been refinance to date. Approximately 40% of all HARP applications submitted are from outside our existing customer base,” Regions said.
