Form 8-K REGIONS FINANCIAL CORP For: Sep 13
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E-mailUNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): September 13, 2016
REGIONS FINANCIAL CORPORATION
(Exact name of registrant as specified in its charter)
DELAWARE | 001-34034 | 63-0589368 | ||
(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) | ||
1900 FIFTH AVENUE NORTH
BIRMINGHAM, ALABAMA 35203
(Address, including zip code, of principal executive office)
Registrant’s telephone number, including area code: (800) 734-4667
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐ | Written communication pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
ITEM 7.01 Regulation FD Disclosure.
Regions Financial Corporation executives are scheduled to make a presentation at the Barclays Global Financial Services Conference in New York City on Wednesday, September 14, 2016 at 9:00 a.m. EDT.
A webcast of the presentation will be available for a limited time on the Investor Relations page of Regions' website at www.regions.com.
A copy of the presentation materials is being furnished as Exhibit 99.1 to this report, substantially in the form intended to be used. Exhibit 99.1 is incorporated by reference under this Item 7.01.
In accordance with general instruction B.2. of Current Report on Form 8-K, this information (including Exhibit 99.1) is furnished and shall not be deemed filed for purposes of Section 18 of the Securities Exchange Act of 1934.
ITEM 9.01 Financial Statements and Exhibits.
(d) Exhibits. The exhibits listed in the exhibit index are furnished pursuant to Regulation FD as part of this Current Report on Form 8-K and shall not be deemed filed for purposes of Section 18 of the Securities Exchange Act of 1934.
Exhibit Index
No. Exhibit
99.1 | Presentation of September 14, 2016. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
REGIONS FINANCIAL CORPORATION
By: /s/ Fournier J. Gale, III
Name: Fournier J. Gale, III
Title: Senior Executive Vice President,
General Counsel and Corporate
Secretary
Date: September 13, 2016
Barclays Global
Financial Services
Conference
September 14, 2016
Exhibit 99.1
Strategic initiatives
Effectively Deploy Capital
Disciplined organic growth
Return appropriate capital to shareholders
Use strategic investments to leverage our infrastructure and
enhance revenue diversification
Disciplined Expense Management
Generate positive operating leverage
Continuously focus on efficiency and effectiveness
Define, develop and execute Six Sigma initiatives
Make prudent investments with appropriate returns
Grow and Diversify Revenue
Leverage SM to grow customers and households and
deepen existing relationships
Prudently grow non-interest income
Balance growth across geographies and businesses
2
2016 YTD results
Expanded customer base as checking
accounts, households, credit cards and
wealth relationships grew
Recognized as having the best overall
reputation among U.S. banks and
among the top 10% in online
experience
Successfully completed annual
Comprehensive Capital Analysis and
Review (CCAR) process and received no
objection to planned capital actions
(1) Non-GAAP; see appendix for reconciliation
Demonstrates we are successfully executing on our strategic plan
+6%
Adjusted efficiency ratio(1)
improved YTD
240 bps
Earnings returned to common
shareholders $258M
3
Generated adjusted positive
operating leverage(1) YTD
4%
Strong adjusted fee based
revenue growth(1) YTD +7%
Total adjusted
revenue (FTE)(1) increased YTD
Non-interest income
(1) Non-GAAP; see appendix for reconciliation
(2) Total Wealth Management income presented above does not include the portion of service charges on deposit accounts and similar
smaller dollar amounts that are also attributable to the Wealth Management segment.
(3) Other income includes market value adjustments associated with certain employee benefits which are offset in salaries and benefits.
Non-interest income – Source of sustainable
franchise value
Growth initiatives
4
+6%
YOY
Wealth Management
income attributed to
growth in insurance and
investment management
and trust fees
+41%
YOY
Capital markets income
attributed to additional
M&A Advisory services,
Fannie Mae DUS license
and HUD medallion
$590
$497 $514
Selected
Items(1)
Other(3)
Capital
Markets
Wealth
Management
Income(2)
Mortgage
Income
Card and ATM
fees
Service
charges on
deposit
accounts
($ in millions)
$506
(2)
29 27 28
$526
+10%
YOY
Card and ATM fees increased
as active credit cards
increased 12% and debit card
transactions increased 6%
Investments are paying off while prudently
managing expenses
($ in millions)
2016 – 35 to 45%
Elimination of core expenses of
$300 million
over the next 3 years(2)
Hiring restrictions for non-customer
facing positions started Oct 2015
Streamlining and automating processes
to reduce personnel needs
60-65%
Operational
Efficiencies
Reduce third-party spend
Curtail discretionary expenditures
25 - 30%
Third-Party,
Discretionary
and Other
Branch reconfiguration and continued
consolidations: 100-150 branches
Announced consolidation of ~ 90
branches in 2016
Targeted reduction in total occupancy of
1 million square feet or ~10%
10 - 15%
Branch and
Real Estate
Optimization
5
(1) Non-GAAP; see appendix for reconciliation
(2) Represents ~9% of 2015 adjusted expense base
859
894
861
843
889
75 1
12
26
26
$934
$895
$873 $869
$915
2Q15 3Q15 4Q15 1Q16 2Q16
Adjusted NIE⁽¹⁾ Selected Items⁽¹⁾
Industry leading capital ratios
Note: Regions’ ratio is estimated at 6/30/16.
Peers include BBT, CMA, FHN, FITB, HBAN, HBHC, KEY, MTB, PNC, SNV, STI, USB and ZION.
Source: SNL Financial
9.5%
9.8%
9.8%
9.8%
9.9%
10.0%
10.0%
10.1%
10.5%
10.6%
[VALUE]
11.0%
11.1%
12.0%
Peer #13
Peer #12
Peer #11
Peer #10
Peer #9
Peer #8
Peer #7
Peer #6
Peer #5
Peer #4
Peer #3
Peer #2
Peer #1
Basel III Common equity Tier 1 ratio
Capital priorities
Organic
Growth
Strategic
Investments
Share
repurchases
Dividends
6
Prudently managing deposits; competitive
advantage for our franchise
7
Certain collateralized deposits within Wealth Management and Corporate segments declined due to planned
reductions
Deposit costs remained near historically low levels at 12 basis points
Funding costs remained low at 29 basis points
Average deposits by type
Average deposits by segment
88.9 89.1 89.7 90.4 90.2
8.2 8.1 7.8 7.4 7.3
$97.1 $97.2 $97.5 $97.8 $97.5
2Q15 3Q15 4Q15 1Q16 2Q16
Low-cost deposits Time deposits + Other
($ in billions)
53.1 52.9 53.0 53.5 54.7
27.2 27.5 27.6 27.6 27.6
12.5 12.3 12.5 12.3 11.3
4.3 4.5 4.4 4.4 3.9
$97.1 $97.2 $97.5 $97.8 $97.5
2Q15 3Q15 4Q15 1Q16 2Q16
Other
Wealth
Management
Corporate Bank
Consumer Bank
($ in billions)
Prudently managing balance sheet
Average loan and lease balances
8
$81.5
($ in billions)
$80.8 $79.2 $80.6
$82.0
Consumer loan balances increased 2% compared
to 4Q15(1) with growth in almost every category
Business loan balances increased 1% compared to
4Q15(1)
Direct energy loans declined $324 million on a
point to point basis from March 31st to June 30th
We continue to exercise caution and discipline as
we approach certain internal concentration risk
lending limits
Customer sentiment in some areas continues to
reflect less optimism and more uncertainty in the
economy
Focused on improving returns by exiting credit
only relationships and recycling into more
profitable relationships
More selective within the indirect auto lending
portfolio in order to maintain risk adjusted
returns that meet targets
(1) Based on average balances
Net interest income and other financing income
and net interest margin
(1) During the fourth quarter of 2015, Regions corrected the accounting for certain leases which had previously been included in loans. The cumulative effect on pre-tax income
lowered net interest income and other financing income $15 million, therefore net interest income and other financing income would have been $871 million. The
correction also reduced the net interest margin by 5 basis points and would have been 3.13%. The company does not expect this adjustment to have a material impact to
net interest income and other financing income or net interest margin in any future reporting period.
Note: Peers include BBT, CMA, FHN, FITB, HBAN, HBHC, KEY, MTB, PNC, SNV, STI, USB and ZION. 9
($ in millions)
(1)
3.11%
3.20% 3.21%
3.13%
3.17%
3.53%
3.36%
3.22%
3.09% 3.06%
2012 2013 2014 2015 YTD16
Regions NIM Peer Median NIM
Asset quality
-6% TDR decrease
YOY
Charge-offs
YTD 34 bps
Coverage
ratio(1)
112%
10
Decline in direct energy
loan balances since 2Q15
11%
Total direct energy loans
as a % of total loans
2.9%
Loan loss allowance up
from 8.0%(2)
9.4%
(1) Represents the percentage of allowance for loan and lease losses to non-performing loans, excluding loans held for sale
(2) Allowance for direct energy loans
Highlights Energy
2016 Expectations
• Average loan growth less than 3%(1)(2)
• Average deposits relatively stable(1)(3)
• Net interest income and other financing income up 2% - 4%
• Adjusted non-interest income up 4% - 6%
• Adjusted expenses flat to up modestly; full year efficiency ratio <63%
• Adjusted operating leverage of 2% - 4%
• Net charge-offs of 25 - 35 bps; continue to expect to be at top end of range
Note: The reconciliation with respect to these forward-looking non-GAAP measures is expected to be consistent with the actual non-GAAP
reconciliations included in the attached appendix.
(1) 4Q16 average balances relative to 4Q15 average balances
(2) This represents a change from previous loan growth guidance of 3%-5%
(3) Accelerated planned reduction of certain deposits within Wealth Management and Corporate segments led to the change from previous guidance of 2%-4%. Within Wealth Management, certain customer
trust deposits, collateralized by securities, were moved into other fee income producing customer investments.
11
Why Regions? – Building sustainable franchise value
Effectively Deploy Capital
Grow and Diversify Revenue
Disciplined Expense Management
Adjusted EPS growth of
12-15% (CAGR)
Adjusted efficiency
ratio of <60%
Adjusted ROATCE
12-14%
Three pillars of execution Long-term expected results How we intend to deliver
Leverage our strengths
– Team
– Culture
– Execution
– Markets
Investing in growth initiatives
Expense eliminations
Grow earnings
Leverage capital
Return capital
12
Appendix
13
• Total outstandings and
commitments declined primarily
due to paydowns and payoffs
• Allowance for loan and lease
losses was 9.4% of direct energy
balances at 6/30/16 vs 8.0% at
3/31/16
• No second lien exposure
outstanding within the energy
portfolio
• Leveraged loans account for 14%
of energy related balances; the
majority are Midstream
• Expectations for energy related
charge-offs are $50-$75 million
through the end of 2017
• Should oil prices average $25 a
barrel through the end of 2017,
Regions could experience
additional losses of $100 million
• Utilization rate has remained
between 40-60% since 1Q10
• 12% of direct energy loans are on
non-accrual status
Energy lending overview
Total energy As of 6/30/16 As of 3/31/16
($ in millions)
Loan /
Lease
Balances
Balances
Including
Related
Commitments
%
Utilization
$
Criticized
%
Criticized
Loan /
Lease
Balances
Balances
Including
Related
Commitments
%
Utilization
$
Criticized
%
Criticized
Oilfield services
and supply (OFS)
$863 $1,332 65% $422 49% $984 $1,435 69% $461 47%
Exploration and
production (E&P)
805 1,434 56% 581 72% 956 1,653 58% 660 69%
Midstream 519 1,082 48% 33 6% 545 1,042 52% 40 7%
Downstream 76 347 22% 18 24% 87 378 23% — —
Other 129 285 45% 24 19% 144 321 45% 39 27%
Total direct 2,392 4,480 53% 1,078 45% 2,716 4,829 56% 1,200 44%
Indirect 531 996 53% 96 18% 503 1,015 50% 59 12%
Direct and
indirect
2,923 5,476 53% 1,174 40% 3,219 5,844 55% 1,259 39%
Operating leases 153 153 — 70 46% 159 159 — 72 45%
Total energy $3,076 $5,629 55% $1,244 40% $3,378 $6,003 56% $1,331 39%
Note: Securities portfolio contained ~$66MM of high quality, investment grade corporate bonds that are energy related at 6/30/16, down from ~$166MM at
3/31/16. A leveraged relationship is defined as senior cash flow leverage of 3x or total cash flow leverage of 4x except for Midstream Energy which is 6x total cash flow
leverage.
14
Energy lending - Oil Field Services and Exploration
& Production detail
Type As of 6/30/16
# of
Clients*
Commentary
Marine $457 9 Client selection is strong with ~61% of
exposure tied to clients with contract
protection through 2016. Expect some
additional stress into 2017 as E&P
companies focus on shorter cycle onshore
projects.
Integrated OFS 162 10 Average utilization is 37% indicating clients
have liquidity to weather cycle.
Compression 119 4 Linked to movement of natural gas; sector
is stable and lower risk.
Fluid Management 38 2 Remains a high risk sector.
Pre-drilling / Drilling 72 2 Reduced capex spending of many E&P
companies impacted current and future
cash flows; however, Regions' larger
borrowers remain liquid.
Sand 15 1 Remains a high risk sector, although sand
volumes have improved in recent weeks in
certain basins.
Total Oil Field
Services (OFS)
$863 28
Exploration and
production (E&P)
$805 29**
Total OFS and E&P $1,668
• 51% shared national credit (SNC) loans
• 65% utilization rate compared to 69%
in 1Q16
• 89% Non-pass rated (criticized) loans
paying as agreed
E&P Portfolio
*Represents the number of clients that comprise 75% of the loan balances outstanding.
**Represents the number of clients that comprise 90% of the loan balances outstanding.
OFS Portfolio
• Completed spring rederminations,
which resulted in an approximate 20%
decline in customer borrowing bases
• Majority of borrowing is senior
secured
• 94% shared national credit (SNC) loans
• 56% utilization rate compared to 58%
in 1Q16
• Essentially all non-pass rated
(criticized) loans paying as agreed
15
Loan balances by select states
Texas
Louisiana
Note: Intelligence from our customer assistance program (CAP) reveals no noticeable increase in assistance requests in these markets to date.
Investor Real Estate Balances by City
($ in millions)
Office Retail
Multi-
Family
Single
Family
Other Total
Houston $18 $61 $322 $89 $20 $510
Dallas 213 32 193 40 57 535
San
Antonio — 26 68 46 45 185
Other 19 56 126 2 18 221
Total $250 $175 $709 $177 $140 $1,451
Investor Real Estate Balances by City
($ in millions)
Office Retail
Multi-
Family
Single
Family
Other Total
Baton
Rouge $43 $4 $26 $42 $21 $136
New
Orleans 5 8 1 2 15 31
Other 3 36 23 2 17 81
Total $51 $48 $50 $46 $53 $248
16
Commercial -
Energy (Direct),
$1,255
Commercial -
Non-Energy,
$4,353
Investor Real
Estate, $1,451
Consumer Real
Estate Secured,
$918
Consumer Non-
Real Estate
Secured, $908
$8.9 B
Commercial -
Energy (Direct),
$480
Commercial -
Non-Energy,
$2,277
Investor Real
Estate, $248
Consumer
Real Estate
Secured, $1,112
Consumer
Non-Real Estate
Secured, $289
$4.4 B
Loan balances by select states
Alabama
Mississippi
Investor Real Estate Balances by City
($ in millions)
Office Retail
Multi-
Family
Single
Family
Other Total
Birmingham $32 $40 $30 $15 $24 $141
Huntsville 49 16 6 9 3 83
Mobile /
Baldwin County 2 17 3 3 15 40
Other 17 20 21 13 20 91
Total $100 $93 $60 $40 $62 $355
Investor Real Estate Balances by City
($ in millions)
Office Retail
Multi-
Family
Single
Family
Other Total
North
Mississippi — — — — $97 $97
Jackson / Other 5 2 41 1 4 53
Gulfport / Biloxi
/ Pascagoula 1 — 20 — 12 33
Total $6 $2 $61 $14 $113 $183
17
Commercial -
Energy (Direct),
$38
Commercial -
Non-Energy,
$5,283
Investor Real
Estate, $355
Consumer Real
Estate Secured,
$3,569
Consumer Non-
Real Estate
Secured, $875
$10.1 B
Commercial -
Energy (Direct),
$66
Commercial -
Non-Energy,
$1,455
Investor Real
Estate, $183
Consumer Real
Estate Secured,
$962
Consumer Non-
Real Estate
Secured, $339
$3.0 B
Non-GAAP reconciliation: Non-interest income,
non-interest expense and efficiency ratio
NM - Not Meaningful
(1) Regions recorded $3 million, $50 million and $100 million of contingent legal and regulatory accruals during the second quarter of 2016, the second quarter of 2015, and the fourth quarter of 2014, respectively, related to previously
disclosed matters. The fourth quarter of 2014 accruals were settled in the second quarter of 2015 for $2 million less than originally estimated and a corresponding recovery was recognized.
(2) Excluding $23 million of FDIC insurance assessment adjustments to prior assessments recorded in the third quarter of 2015, the adjusted efficiency ratio would have been 65.0%.
(3) During the fourth quarter of 2015, Regions corrected the accounting for certain leases, for which Regions is the lessor. These leases had been previously classified as capital leases but were subsequently determined to be operating
leases. The aggregate impact of this adjustment lowered net interest income and other financing income $15 million. Excluding the negative impact of the $15 million, the adjusted efficiency ratio would have been 62.7%.
The table below presents computations of the efficiency ratio (non-GAAP), which is a measure of productivity, generally calculated as non-interest expense divided by total revenue. Management uses this ratio to
monitor performance and believes this measure provides meaningful information to investors. Non-interest expense (GAAP) is presented excluding certain adjustments to arrive at adjusted non-interest expense (non-
GAAP), which is the numerator for the efficiency ratio. Non-interest income (GAAP) is presented excluding certain adjustments to arrive at adjusted non-interest income (non-GAAP), which is the numerator for the
fee income ratio. Net interest income and other financing income on a taxable-equivalent basis and non-interest income are added together to arrive at total revenue on a taxable-equivalent basis. Adjustments are
made to arrive at adjusted total revenue on a taxable-equivalent basis (non-GAAP), which is the denominator for the efficiency ratio. Regions believes that the exclusion of these adjustments provides a meaningful
base for period-to-period comparisons, which management believes will assist investors in analyzing the operating results of the Company and predicting future performance. These non-GAAP financial measures are
also used by management to assess the performance of Regions’ business. It is possible that the activities related to the adjustments may recur; however, management does not consider the activities related to the
adjustments to be indications of ongoing operations. The table on the following page presents a computation of the operating leverage ratio (non-GAAP) which is the period to period percentage change in adjusted
total revenue on a taxable-equivalent basis (non-GAAP) less the percentage change in adjusted non-interest expense (non-GAAP). Regions believes that presentation of these non-GAAP financial measures will
permit investors to assess the performance of the Company on the same basis as that applied by management.
18
Non-GAAP reconciliation continued: YTD Non-
interest income, non-interest expense, efficiency
ratio and operating leverage
(1) See page 7 of 2Q16 Financial Supplement for additional detail on these adjustments.
19
Forward-looking statements
This presentation may include forward-looking statements, as defined in the Private Securities Litigation Reform Act of 1995, which reflect Regions’ current views with respect to future events
and financial performance. Forward-looking statements are not based on historical information, but rather are related to future operations, strategies, financial results or other
developments. Forward-looking statements are based on management’s expectations as well as certain assumptions and estimates made by, and information available to, management at
the time the statements are made. Those statements are based on general assumptions and are subject to various risks, uncertainties and other factors that may cause actual results to differ
materially from the views, beliefs and projections expressed in such statements. These risks, uncertainties and other factors include, but are not limited to, those described below:
• Current and future economic and market conditions in the United States generally or in the communities we serve, including the effects of declines in property values, unemployment rates and
potential reductions of economic growth, which may adversely affect our lending and other businesses and our financial results and conditions.
• Possible changes in trade, monetary and fiscal policies of, and other activities undertaken by, governments, agencies, central banks and similar organizations, which could have a material adverse
effect on our earnings.
• The effects of a possible downgrade in the U.S. government’s sovereign credit rating or outlook, which could result in risks to us and general economic conditions that we are not able to predict.
• Possible changes in market interest rates or capital markets could adversely affect our revenue and expense, the value of assets and obligations, and the availability and cost of capital and liquidity.
• Any impairment of our goodwill or other intangibles, or any adjustment of valuation allowances on our deferred tax assets due to adverse changes in the economic environment, declining operations
of the reporting unit, or other factors.
• Possible changes in the creditworthiness of customers and the possible impairment of the collectability of loans.
• Changes in the speed of loan prepayments, loan origination and sale volumes, charge-offs, loan loss provisions or actual loan losses where our allowance for loan losses may not be adequate to cover
our eventual losses.
• Possible acceleration of prepayments on mortgage-backed securities due to low interest rates, and the related acceleration of premium amortization on those securities.
• Our ability to effectively compete with other financial services companies, some of whom possess greater financial resources than we do and are subject to different regulatory standards than we are.
• Loss of customer checking and savings account deposits as customers pursue other, higher-yield investments, which could increase our funding costs.
• Our inability to develop and gain acceptance from current and prospective customers for new products and services in a timely manner could have a negative impact on our revenue.
• The effects of any developments, changes or actions relating to any litigation or regulatory proceedings brought against us or any of our subsidiaries.
• Changes in laws and regulations affecting our businesses, such as the Dodd-Frank Act and other legislation and regulations relating to bank products and services, as well as changes in the enforcement
and interpretation of such laws and regulations by applicable governmental and self-regulatory agencies, which could require us to change certain business practices, increase compliance risk, reduce
our revenue, impose additional costs on us, or otherwise negatively affect our businesses.
• Our ability to obtain a regulatory non-objection (as part of the CCAR) process or otherwise) to take certain capital actions, including paying dividends and any plans to increase common stock dividends,
repurchase common stock under current or future programs, or redeem preferred stock or other regulatory capital instruments, may impact our ability to return capital to stockholders and market
perceptions of us.
• Our ability to comply with stress testing and capital planning requirements (as part of the CCAR process or otherwise) may continue to require a significant investment of our managerial resources due
to the importance and intensity of such tests and requirements.
• Our ability to comply with applicable capital and liquidity requirements (including, among other things, the Basel III capital standards and the LCR rule), including our ability to generate capital
internally or raise capital on favorable terms, and if we fail to meet requirements, our financial condition could be negatively impacted.
• The Basel III framework calls for additional risk-based capital surcharges for globally systemically important banks. Although we are not subject to such surcharges, it is possible that in the future we
may become subject to similar surcharges.
• The costs, including possibly incurring fines, penalties, or other negative effects (including reputational harm) of any adverse judicial, administrative, or arbitral rulings or proceedings, regulatory
enforcement actions, or other legal actions to which we or any of our subsidiaries are a party, and which may adversely affect our results.
• Our ability to manage fluctuations in the value of assets and liabilities and off-balance sheet exposure so as to maintain sufficient capital and liquidity to support our business.
• Our ability to execute on our strategic and operational plans, including our ability to fully realize the financial and non-financial benefits relating to our strategic initiatives.
• The success of our marketing efforts in attracting and retaining customers.
• Possible changes in consumer and business spending and saving habits and the related effect on our ability to increase assets and to attract deposits, which could adversely affect our net income.
• Our ability to recruit and retain talented and experienced personnel to assist in the development, management and operation of our products and services may be affected by changes in laws and
regulations in effect from time to time.
• Fraud or misconduct by our customers, employees or business partners.
20
Forward-looking statements continued
The foregoing list of factors is not exhaustive. For discussion of these and other factors that may cause actual results to differ from expectations, look under the captions “Forward-Looking Statements” and
“Risk Factors" of Regions' Annual Report on Form 10-K for the year ended December 31, 2015, as filed with the Securities and Exchange Commission.
The words “anticipates,” “intends,” “plans,” “seeks,” “believes,” “estimates,” “expects,” “targets,” “projects,” “outlook,” “forecast,” “will,” “may,” “could,” “should,” “can,” and similar expressions often
signify forward-looking statements. You should not place undue reliance on any forward-looking statements, which speak only as of the date made. We assume no obligation to update or revise any forward-
looking statements that are made from time to time.
• Any inaccurate or incomplete information provided to us by our customers or counterparties.
• The risks and uncertainties related to our acquisition and integration of other companies.
• Inability of our framework to manage risks associated with our business such as credit risk and operational risk, including third-party vendors and other service providers,
which could, among other things, result in a breach of operating or security systems as a result of a cyber attack or similar act.
• The inability of our internal disclosure controls and procedures to prevent, detect or mitigate any material errors or fraudulent acts.
• The effects of geopolitical instability, including wars, conflicts and terrorist attacks and the potential impact, directly or indirectly, on our businesses.
• The effects of man-made and natural disasters, including fires, floods, droughts, tornadoes, hurricanes, and environmental damage, which may negatively affect our
operations and/or our loan portfolios and increase our cost of conducting business.
• Changes in commodity market prices and conditions could adversely affect the cash flows of our borrowers operating in industries that are impacted by changes in
commodity prices (including businesses indirectly impacted by commodities prices such as businesses that transport commodities or manufacture equipment used in the
production of commodities), which could impair their ability to service any loans outstanding to them and/or reduce demand for loans in those industries.
• Our inability to keep pace with technological changes could result in losing business to competitors.
• Our ability to identify and address cyber-security risks such as data security breaches, “denial of service” attacks, “hacking” and identity theft, a failure of which could
disrupt our business and result in the disclosure of and/or misuse or misappropriation of confidential or proprietary information; increased costs; losses; or adverse effects to
our reputation.
• Our ability to realize our efficiency ratio target as part of our expense management initiatives.
• Significant disruption of, or loss of public confidence in, the Internet and services and devices used to access the Internet could affect the ability of our customers to access
their accounts and conduct banking transactions.
• Possible downgrades in our credit ratings or outlook could increase the costs of funding from capital markets.
• The effects of problems encountered by other financial institutions that adversely affect us or the banking industry generally could require us to change certain business
practices, reduce our revenue, impose additional costs on us, or otherwise negatively affect our businesses.
• The effects of the failure of any component of our business infrastructure provided by a third party could disrupt our businesses; result in the disclosure of and/or misuse of
confidential information or proprietary information; increase our costs; negatively affect our reputation; and cause losses.
• Our ability to receive dividends from our subsidiaries could affect our liquidity and ability to pay dividends to stockholders.
• Changes in accounting policies or procedures as may be required by the FASB or other regulatory agencies could materially affect how we report our financial results.
• Other risks identified from time to time in reports that we file with the SEC.
• The effects of any damage to our reputation resulting from developments related to any of the items identified above.
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