Regions Bank reviews sales practices as wealth businesses hit record revenue
Regions Bank is taking steps to avoid the issues that have engulfed Wells Fargo.
During an earnings call on Tuesday, the bank's chairman, president and CEO Grayson Hall noted that the bank is "re-challenging itself on all of its sales practices."
Hall said that even though the bank has great confidence in the processes it built, it nonetheless is "re-reviewing everything it's doing."
"We think we're doing the right thing, but more importantly we're doing them in the right way," he told analysts, adding that "we have to make sure that's occurring in all aspects."
Hall reported strong third-quarter results for the bank's wealth management businesses. The Birmingham, Ala.-based bank generated a record $107 million in third-quarter revenue from its brokerage, trust and insurance operations, up 4.9% from $102 million in the same quarter a year ago.
The increase was due to increased investment management and trust fees, the bank's CFO David Turner explained during the earnings call.
Revenue was up 3.9% from the prior quarter, an increase due to increased investment management and trust fees as assets under administration swelled 5% to $92.6 billion from $88.1 billion, Turner said.
For the first nine months of 2016, the wealth management businesses were able to beat last year's revenue figures, climbing 6.4% to $316 million from $297 million in 2015.
The trust services business was the biggest revenue driver in the third quarter, generating $54 million, up 10.2% year-over-year and up 3.8% from the prior quarter. Insurance services hauled in $38 million, while the retail brokerage business drummed up $15 million. Revenue from both insurance and brokerage operations were flat from the same period a year ago.
Overall, Regions Financial Corp., the parent of Regions Bank, earned $304 million, or 24 cents per diluted share, in the third quarter, compared with $242 million, or 18 cents per diluted share, in the same quarter of 2015.
"Our third-quarter results reflect continued momentum in 2016 and demonstrate that we are successfully executing on our strategic plan," Hall said during the call. "We are pleased with our continued progress on fundamentals despite a challenging operating environment."
Rick Ulmer, the former regional executive for insurance services in the Mid-America region, will now oversee insurance operations in 10 states.August 12