8-K

UNITED 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): June 19, 2014

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 1.01 Entry into a Material Definitive Agreement.

On June 25, 2014, Regions Financial Corporation (“Regions”) announced that it entered into a deferred prosecution agreement with the Securities and Exchange Commission (“SEC”) and that its subsidiary, Regions Bank, entered into a consent order and assessment of civil money penalty with the Board of Governors of the Federal Reserve System and the Alabama State Banking Department.

These agreements resolve previously disclosed regulatory inquiries involving the accounting for certain problem loans at the end of the first quarter of 2009. As part of the terms of the agreements, Regions Bank will pay a $51 million civil money penalty. As previously disclosed, Regions established a reserve in the fourth quarter of 2013 sufficient to cover this matter.

The foregoing summary does not purport to be complete and is qualified in its entirety by reference to the agreements, copies of which are attached as Exhibits 10.1 and 10.2, respectively, and are incorporated herein by reference. A copy of the press release announcing the settlements is also attached hereto as Exhibit 99.1 and is incorporated herein by reference.

ITEM 9.01 Financial Statements and Exhibits.

(d) Exhibits.

10.1	Deferred Prosecution Agreement dated June 19, 2014, between Regions Financial Corporation and the Securities and Exchange Commission.
10.2	Consent Order and Assessment of Civil Money Penalty Issued Upon Consent Pursuant to the Federal Deposit Insurance Act, as Amended, dated June 25, 2014, of the Board of Governors of the Federal Reserve System and Alabama State Banking Department in the Matter of Regions Bank.
99.1	Press Release of Regions Financial Corporation dated June 25, 2014.

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: June 25, 2014

EX-10.1

Exhibit 10.1

UNITED STATES OF AMERICA

SECURITIES AND EXCHANGE COMMISSION

DEFERRED PROSECUTION AGREEMENT

1. In connection with an investigation, the Division of Enforcement (“Division”) of the United States Securities and Exchange Commission (“Commission”) alleges that Regions Financial Corporation (“Respondent” or “Regions”) violated Section 17(a) of the Securities Act of 1933 (the “Securities Act”), and Sections 10(b), 13(a), 13(b)(2)(A) and 13(b)(2)(B) of the Securities Exchange Act of 1934 (the “Exchange Act”) and Rules 10b-5, 12b-20, 13a-11, and 13a-13 thereunder, through the actions of three senior managers at Regions who effected a fraudulent scheme, beginning in March 2009, to misclassify approximately $168 million in commercial loans (the “Loans”) as improperly remaining in accrual status in accordance with its policies, resulting in Regions, for the quarter ended March 31, 2009, overstating its net income available to common shareholders and its earnings per common share, failing to make and keep accurate books, records, and accounts relating to the Loans, and failing to maintain compliant internal accounting controls (“Investigation”). Prior to a public enforcement action being brought by the Commission against it, without admitting or denying these allegations, Respondent has offered to accept responsibility for its conduct and to not contest or contradict the factual statements contained in Paragraph 6 in any future Commission enforcement action in the event it breaches this Agreement. Accordingly, the Commission and the Respondent enter into this deferred prosecution agreement (“Agreement”) on the following terms and conditions:

TERM

2. The Respondent understands and agrees that the provisions of this Agreement are in full force and effect from July 3, 2014 to July 3, 2016 (“Deferred Period”), unless expressly stated otherwise.

COOPERATION

3. The Respondent, a corporation organized and operating under the laws of Delaware, for itself, and its subsidiaries (“Related Entities”), agree to cooperate fully and truthfully in the Investigation and any other related enforcement litigation or proceeding to which the Commission is a party (the “Proceedings”), regardless of the time period in which the cooperation is required. In addition, the Respondent agrees to cooperate fully and truthfully, when directed by the Division’s staff, in any investigation, action or proceeding by any federal, state, self-regulatory, or regulatory organization or agency related to the Investigation and the statement of facts contained in this Agreement (“Other Proceedings”). The full, truthful, and continuing cooperation of the Respondent and Related Entities shall include, but not be limited to:

a. producing, in a responsive and prompt manner, all non-privileged documents, information, and other materials to the Commission as requested by the Division’s staff, wherever located, in the possession, custody, or control of the Respondent or any of its Related Entities, and promptly seeking permission from the Board of Governors of the Federal Reserve System and the superintendent of the Alabama State Banking Department to produce requested confidential supervisory information as that term is defined in 12 C.F.R. 261.2.;

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b. using its best efforts to secure the full, truthful, and continuing cooperation, as defined in Paragraph 4, of current and former directors, officers, employees and agents, including making these persons available, when requested to do so by the Division’s staff, at its expense, for interviews and the provision of testimony in the investigation, trial and other judicial proceedings in connection with the Proceedings or Other Proceedings; and

c. entering into tolling agreements, when requested to do so by the Division’s staff, during the period of cooperation.

4. The full, truthful, and continuing cooperation of each person described in Paragraph 3 above will be subject to the procedures and protections of this paragraph, and shall include, but not be limited to:

a. producing all non-privileged documents and other materials as requested by the Division’s staff;

b. appearing for interviews, at such times and places, as requested by the Division’s staff;

c. responding to all inquiries, when requested to do so by the Division’s staff, in connection with the Proceedings or Other Proceedings; and

d. testifying at trial and other judicial proceedings, when requested to do so by the Division’s staff, in connection with the Proceedings or Other Proceedings.

STATUTE OF LIMITATIONS

5. The Respondent agrees that the running of any statute of limitations applicable to any action or proceeding against it authorized, instituted, or brought by or on behalf of the Commission arising out of the Investigation (“Proceeding”), including any sanctions or relief that may be imposed therein, is tolled and suspended during the Deferred Period.

a. The Respondent and any of its attorneys or agents shall not include the Deferred Period in the calculation of the running of any statute of limitations or for any other time-related defense applicable to the Proceeding, including any sanctions or relief that may be imposed therein, in asserting or relying upon any such time-related defense.

b. This agreement shall not affect any applicable statute of limitations defense or any other time-related defense that may be available to Respondent before the commencement of the Deferred Period or be construed to revive a Proceeding that may be barred by any applicable statute of limitations or any other time-related defense before the commencement of the Deferred Period.

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c. The running of any statute of limitations applicable to the Proceeding shall commence again after the end of the Deferred Period, unless there is an extension of the Deferred Period executed in writing by or on behalf of the parties hereto.

d. This agreement shall not be construed as an admission by the Commission relating to the applicability of any statute of limitations to the Proceeding, including any sanctions or relief that may be imposed therein, or to the length of any limitations period that may apply, or to the applicability of any other time-related defense.

STATEMENT OF FACTS¹

6. If this case had gone to trial, the Commission would have presented evidence sufficient to prove the following facts:

a. Regions is a Delaware financial holding corporation headquartered in Birmingham, Alabama. Regions conducts its banking operations through its subsidiary Regions Bank, which is a member of the Federal Reserve System. Regions’ common stock is registered with the Commission pursuant to Section 12(b) of the Securities Act and trades on the New York Stock Exchange under the symbol “RF.” As of December 31, 2013, Regions had approximately $117 billion in assets.

b. During March 2009, personnel within Regions Bank’s Special Asset Department, in accordance with Regions’ policies and procedures, recommended that approximately $168 million of certain commercial loans be placed into non-accrual status.

c. At the end of March 2009, Regions’ Head of Special Assets, Jeffrey C. Kuehr, its Executive Vice President for the Risk Management Credit Division, Thomas A. Neely, Jr., and its Chief Credit Officer, Michael J. Willoughby (collectively, the “Senior Managers”), arbitrarily and without supporting documentation, took intentional steps to keep the Loans in accrual status for the quarter ended March 31, 2009. This misclassification under its policies prevented Regions from appropriately measuring impairment in accordance with Generally Accepted Accounting Principles (“GAAP”). Such deliberate misconduct by the Senior Managers to evade existing policies and procedures rendered Regions’ financial statements for the quarter ended March 31, 2009 not in conformity with GAAP.

d. The Senior Managers intentionally circumvented Regions’ internal accounting controls by reporting the Loans in a manner that was not in accordance with Regions’ policies and procedures. As a result, Regions failed to maintain a system of internal accounting controls sufficient to provide reasonable assurances that the Loans were recorded as necessary to permit preparation of financial statements in conformity with generally accepted accounting principles.

¹  The facts set forth in this section are made pursuant to settlement negotiations associated with the violations alleged by the Division in Paragraph 1 of this Agreement and are not binding in any other legal proceeding or on any other person or entity. Nothing in this Agreement shall limit or otherwise affect Respondent’s testimonial obligations or right to take legal or factual positions in any action or proceeding to which the Commission is not a party. Nothing in this Agreement shall be construed to waive or limit any applicable claims of privilege or other legal protections that may apply to Respondent or any other person or entity.

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e. The intentional misconduct by the Senior Managers resulted in Regions’ failing to make and keep books, records, and accounts, in reasonable detail, which accurately reflected the Loans. Further, Regions’ accounts were falsified through the intentional misconduct of the Senior Managers.

f. The books, records and accounts reflecting the Loans were incorporated into Regions’ consolidated financial statements for the quarter ended March 31, 2009.

g. As a result of the intentional misconduct of the Senior Managers, Regions failed to properly account for the Loans in accordance with GAAP, for the quarter ended March 31, 2009. Had the Loans been classified in non-accrual status in their entirety under Regions’ policies, the impact of the additional impairment measured in conformity with GAAP, would have been to reduce Regions’ income before taxes by approximately $16 million, its net income applicable to common shareholders by approximately $11 million, and its earnings per common share by approximately $.02 per share.

h. The above material misstatements were included in Regions’ April 21, 2009 press release included in its Form 8-K dated April 21, 2009 and filed with the Commission on April 21, 2009, in its March 31, 2009 Form 10-Q filed May 11, 2009, and two subsequent amendments to its March 31, 2009 Form 10-Q filed on May 13, 2009 and June 9, 2009, in a Form S-4 filed on May 20, 2009 and in three subsequent amendments to this registration statement on May 22, 2009, June 4, 2009, and June 9, 2009, and in a Form S-8 filed on August 28, 2009 (collectively, the “Public Filings”).

REMEDIAL CONDUCT

7. From the period following the Public Filings through the Investigation, Regions undertook, among other things, the following remedial actions:

a. ended its employment relationship with each of the Senior Managers;

b. employment of four new directors with greater financial risk experience, as well as employment of a new Chief Executive Officer, Chief Financial Officer, General Counsel and Chief Credit Officer;

c. creation of an Ethics Council;

d. revised and enhanced its ethics policy and code of conduct, with specific focus on maintaining the accuracy of its books and records;

e. created a new organizational structure for its credit group and enhanced the documentation requirements and policies for the credit group including standardization of risk ratings;

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f. revised and enhanced the policies and procedures relating to credit review;

g. abolished the previous special assets division and established a new problem asset management division with new management and enhanced policies and procedures for addressing problem assets;

h. created a Regulatory Operations team within the Enterprise Risk Management Group to ensure and certify timely production of information requested by Regions’ regulatory supervisors;

i. developed Executive Compensation Plans in conjunction with its regulatory supervisors and third party compensation consultants;

j. increased governance and Board oversight; and

k. enhanced loan portfolio analytics capabilities.

8. Regions provided extensive cooperation to the Division throughout the Investigation. Regions created voluminous documents in a highly customized manner at the request of the Division, made multiple employees, including senior executives, available for prompt questioning by the Division in both formal and informal settings, provided multiple extensive presentations focused on matters requested by the Division, and created in-depth accounting analyses for the benefit of the Division, all of which significantly enabled the Division to conduct the Investigation in a highly efficient manner.

PROHIBITIONS

9. During the Deferred Period, the Respondent understands and agrees to comply with the following prohibitions:

a. to refrain from violating Section 17(a) of the Securities Act and Sections 10(b), 13(a), 13(b)(2)(A) and 13(b)(2)(B) of the Exchange Act and Rules 10b-5, 12b-20, 13a-11, and 13a-13 thereunder;

b. to refrain from seeking or accepting a federal or state tax credit or deduction for any civil penalties paid pursuant to this Agreement or to the Federal Reserve Board related to or in connection with the conduct described in Paragraph 6; and

c. to refrain from seeking or accepting reimbursement or indemnification from any source, including, but not limited to, payment made pursuant to an insurance policy or employment contract, with regard to any civil penalties paid pursuant to this Agreement or to the Federal Reserve Board related to or in connection with the conduct described in Paragraph 6.

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UNDERTAKINGS

10. During the Deferred Period, the Respondent understands and agrees to perform the following undertakings:

a. to provide written notification to the Division, within ten days, if it has been charged or convicted of an offense by any federal, state, or local law enforcement organization or regulatory agency;

b. to pay a civil penalty in the amount of $26 million within 30 days of the date of this Agreement by delivering or mailing by next-day mail a certified check, bank cashier’s check, or United States postal money order, payable to the Securities and Exchange Commission, to the Office of Financial Management, Securities and Exchange Commission, Operations Center, 6432 General Green Way, Mail Stop 0-3, Alexandria, Virginia 22312 along with a letter identifying the Respondent and specifying that the payment is made pursuant to a deferred prosecution agreement entered into with the Commission on June 19, 2014, and sending an additional copy of the letter and check in accordance with the service requirements of Paragraph 13;

c. all civil penalty amounts identified in Paragraph 10.b above shall be deemed concurrent with any penalty imposed by the Federal Reserve Board related to or in connection with the conduct described in Paragraph 6, and any payments made to the Federal Reserve Board related to or in connection with the conduct described in Paragraph 6 in an amount greater than or equal to the civil penalty amounts identified in Paragraph 10.b above shall be deemed to satisfy the civil penalty undertaking identified in Paragraph 10.b above; and

d. to provide the Division with a written certification of compliance with the prohibitions and undertakings in this Agreement between forty-five and sixty days before the end of the Deferred Period.

PUBLIC STATEMENTS

11. After the Deferred Period begins, the Respondent agrees not to take any action or to make or permit any public statement through present or future attorneys, employees, agents, or other persons authorized to speak for it, except in legal proceedings in which the Commission is not a party, denying, directly or indirectly, any aspect of this Agreement or creating the impression that the statements in Paragraph 6 of this Agreement are without factual basis. This paragraph is not intended to apply to any statement made by an individual in the course of any criminal, civil, or regulatory proceeding initiated by the government or self-regulatory organization against such individual or in which such individual is required to testify, unless such individual is speaking on behalf of the Respondent. If it is determined by the Commission that a public statement by the Respondent or any related person contradicts in whole or in part this Agreement, at its sole discretion, the Commission may bring an enforcement action in accordance with Paragraphs 14 through 17.

12. Prior to issuing a press release concerning this Agreement, the Respondent agrees to have the text of the release approved by the staff of the Division.

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SERVICE

13. The Respondent agrees to serve by hand delivery or by next-day mail all written notices and correspondence required by or related to this Agreement to Aaron W. Lipson, U.S. Securities and Exchange Commission, 950 East Paces Ferry Road, N.E., Suite 900, Atlanta, GA 30326-1382, unless otherwise directed in writing by the staff of the Division.

VIOLATION OF AGREEMENT

14. The Respondent understands and agrees that it shall be a violation of this Agreement if it knowingly provides false or misleading information or materials in connection with the Proceedings or Other Proceedings. In the event of such misconduct, the Division will advise the Commission of the Respondent’s misconduct and may make a criminal referral for providing false information (18 U.S.C. § 1001), contempt (18 U.S.C. §§ 401-402) and/or obstructing justice (18 U.S.C. § 1503 et seq.).

15. The Respondent understands and agrees should the Division determine that it has failed to comply with any term or condition of this Agreement, the Division will notify the Respondent or its counsel of the fact and provide an opportunity for the Respondent to make a submission consistent with the procedures set forth in the Securities Act of 1933 Release No. 5310. Under these circumstances, the Division may, in its sole discretion and not subject to judicial review, recommend to the Commission an enforcement action against the Respondent for any securities law violations, including, but not limited to, the substantive offenses relating to the Investigation. Nothing in this agreement limits the Division’s discretion to recommend to the Commission an enforcement action against the Respondent for future violations of the federal securities laws, without notice, to protect the public interest.

16. The Respondent understands and agrees that in any future enforcement action resulting from its violation of the Agreement, any documents, statements, information, testimony, or evidence provided by it during the Proceedings or Other Proceedings, and any leads derived there from, may be used against it in future legal proceedings.

17. In the event it breaches this Agreement, the Respondent agrees not to contest, contradict, or oppose admission as evidence in any future Commission enforcement action the factual statements contained in Paragraph 6 above.

COMPLIANCE WITH AGREEMENT

18. Subject to the full, truthful, and continuing cooperation of the Respondent, as described in Paragraphs 3 and 4, and compliance by Respondent with all obligations, prohibitions and undertakings in the Agreement during the Deferred Period, the Commission agrees not to bring any enforcement action or proceeding against the Respondent arising from the Investigation, after the conclusion of the Deferred Period.

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19. The Respondent understands and agrees that this Agreement does not bind other federal, state, self-regulatory organizations or regulatory agencies, but the Commission may, at its discretion, issue a letter to these organizations detailing the fact, manner, and extent of its cooperation during the Proceedings or Other Proceedings, upon the written request of the Respondent.

20. The Respondent understands and agrees that if it sells, merges, or transfers all or substantially all of its business operations as they exist as of the date of this Agreement, whether such a sale is structured as a stock or asset sale, merger, or transfer during the Deferred Period, it shall include in any contract for sale, merger, or transfer a provision binding the purchaser/successor in interest to the obligations set forth in this Agreement.

21. The Respondent understands and agrees that the Agreement only provides protection against enforcement actions arising from the Investigation and does not relate to any other violations or any individual or entity other than the Respondent and Related Entities.

VOLUNTARY AGREEMENT

22. The Respondent’s decision to enter into this Agreement is freely and voluntarily made and is not the result of force, threats, assurances, promises, or representations other than those contained in this Agreement.

23. The Respondent has read and understands this Agreement. Furthermore, the Respondent has reviewed all legal and factual aspects of this matter with its attorney and is fully satisfied with its attorney’s legal representation. The Respondent has thoroughly reviewed this Agreement with its attorney and has received satisfactory explanations concerning each paragraph of the Agreement. After conferring with its attorney and considering all available alternatives, the Respondent has made a knowing decision to enter into the Agreement.

24. The Respondent represents that its Board of Directors has duly authorized, in the resolution attached as Exhibit A, the execution and delivery of this Agreement, and that the person signing this Agreement has authority to bind the Respondent.

ENTIRETY OF AGREEMENT

25. This Agreement constitutes the entire agreement between the Commission and the Respondent, and supersedes all prior understandings, if any, whether oral or written, relating to the subject matter herein.

26. This Agreement cannot be modified except in writing, signed by the Respondent and a representative of the Commission.

[CONCLUDED ON FOLLOWING PAGE]

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27. In the event an ambiguity or a question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the parties hereto, and no presumption or burden of proof shall arise favoring or disfavoring the Commission or the Respondent by virtue of the authorship of any of the provisions of the Agreement.

The signatories below acknowledge acceptance of the foregoing terms and conditions.

RESPONDENT REGIONS FINANCIAL CORP.

6-10-14	/s/ Fournier J. Gale, III
Date	Fournier J. Gale, III General Counsel Regions Center, 21st Floor 1900 5th Avenue North Birmingham, Alabama 35203

On June 10, 2014, Fournier J. Gale III, a person known to me, personally appeared before me and acknowledged executing the foregoing agreement with full authority to do so on behalf of Regions Financial Corp. as its General Counsel and pursuant to the attached Resolution of the Board of Directors.

/s/ Karen Michele Cooley
Notary Public State: Alabama Commission number: Commission expiration: April 19, 2016
RESPONDENT’S COUNSEL
Approved as to form:
6/10/14	/s/ Maibeth Porter, Esq.
Date	Maibeth Porter, Esq. Maynard Cooper & Gale PC 2400 Regions/Harbert Plaza 1901 Sixth Avenue North Birmingham, Alabama 35203 (205) 254-1025

SECURITIES AND EXCHANGE COMMISSION

DIVISION OF ENFORCEMENT

June 19, 2014	/s/ William P. Hicks
Date	William P. Hicks
	Associate Regional Director
	Atlanta Regional Office

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Exhibit A

SECRETARY CERTIFICATE OF

REGIONS FINANCIAL CORPORATION

I, Fournier J. Gale, III, the duly elected, qualified and acting Corporate Secretary of Regions Financial Corporation, a corporation organized and existing under the laws of the State of Delaware (“Regions”), do hereby certify that set forth below is a true and correct copy of a resolution adopted by the Board of Directors (“Board”) of Regions at a meeting duly called and held on June 10, 2014, at which a quorum was present and voted throughout and that the same resolution has not been modified or rescinded since the date thereof and is now in full force and effect.

WHEREAS, the Board of Directors of Regions Financial Corporation (“Company”) believes that it is in the best interest of the Company and its shareholders to settle certain matters with the Securities and Exchange Commission of the United States (“SEC”) arising from conduct beginning in March 2009,

THEREFORE, IT IS HEREBY:

RESOLVED, that, subject to final regulatory approval, the Deferred Prosecution Agreement with the SEC (“Agreement”), which was presented to the Board on June 10, 2014, is approved;

RESOLVED, that the Company is authorized to enter into the Agreement;

RESOLVED, that, for purposes of these resolutions, “Authorized Officer” shall mean any of the following persons: any employee of the Company with the title of President, Chief Executive Officer, Chief Financial Officer, Chief Risk Officer, General Counsel, Secretary, Assistant Secretary, Treasurer, Senior Executive Vice President, Executive Vice President or Controller, acting alone or together, in each case for so long as such Authorized Officer is an employee of the Company, and holding such title, or any designee of any of the aforementioned persons;

RESOLVED, that each Authorized Officer is hereby authorized and empowered to negotiate, approve, enter into, perform, or cause to be performed, all such acts, deeds and things to make, execute and deliver, or cause to be made, executed and delivered, all such agreements, undertakings, documents, instruments or certificates in the name and on behalf of the Company or otherwise as each such Authorized Officer may deem necessary, advisable or appropriate to effectuate or carry out fully the purpose and intent of the foregoing resolutions, including the performance of the Company under the Agreement and payment of any monetary penalty; and

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RESOLVED, that all acts and deeds heretofore done in connection with the actions contemplated in the above resolutions by any officer of the Company for or on behalf of the Company in negotiating, approving, entering into, executing, acknowledging or attesting any arrangements, agreements, instruments or documents, or in carrying out the terms and intentions of the above resolutions are hereby ratified, approved, and confirmed in all respects.

IN WITNESS WHEREOF, the undersigned has set his hand and affixed the seal of Regions Financial Corporation, this 10^th day of June, 2014.

/s/ Fournier J. Gale, III

Fournier J. Gale, III

Corporate Secretary

Regions Financial Corporation

[Seal]

[Regions Financial Corporation]

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EX-10.2

Exhibit 10.2

UNITED STATES OF AMERICA

BEFORE THE

BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM

WASHINGTON, D.C.

and

ALABAMA STATE BANKING DEPARTMENT

In the Matter of:	FRB Docket No. 14-    -B-SMB
REGIONS BANK
Birmingham, Alabama	Consent Order and Assessment of Civil Money Penalty Issued Upon Consent Pursuant to the Federal Deposit Insurance Act, as Amended

WHEREAS, Regions Bank, Birmingham, Alabama (“Regions Bank” or the “Bank”) is a state-chartered bank that is a member of the Federal Reserve System;

WHEREAS, the Board of Governors of the Federal Reserve System (“Board of Governors”) and the Alabama State Banking Department (“Department”) (collectively the “Supervisors”) conducted joint investigations into the practices of Regions Bank concerning whether the Bank, or any institution-affiliated party, as that term is defined in Section 1813(u) of the Federal Deposit Insurance Act, as amended, 12 U.S.C. §§ 1813(u) (the “FDI Act”), of the Bank had engaged or participated in any violations of law, rule or regulation, unsafe or unsound practices, or breaches of fiduciary duty in connection with, inter alia, Regions Bank’s reporting of commercial real estate loans or other loans held by the Bank for nonaccrual status at the end of the first quarter of 2009 and Region Bank’s response to the Supervisors’ May 2009 targeted bank examination of the Bank’s process for identifying and reporting nonaccrual loans;

WHEREAS, the Supervisors’ investigations into the Bank’s 2009 conduct identified then-existing deficiencies in Regions Bank’s oversight of its risk management function associated with the Bank’s reporting of commercial real estate or other loans held by the Bank for nonaccrual status; the accuracy and completeness of the Bank’s response to requests for information from the Supervisors and their examiners in response to the May 2009 targeted examination of the Bank’s processing of nonaccrual loans; and the lack of attentiveness at that time by the Bank’s senior management to supervisory directives, such as Matters Requiring Immediate Attention, that arise out of the bank examination process;

WHEREAS, this Consent Order and Assessment of Civil Money Penalty Issued Upon Consent (the “Consent Order”) is issued with respect to the following:

A. During March 2009, Regions Bank failed to maintain objective, rigorous and well-documented controls and procedures for identifying loans for nonaccrual status with particular regard to certain large-balance commercial real estate and other loans;

B. In connection with a targeted examination by the Supervisors in May 2009, which focused on Regions Bank’s controls and procedures for identifying loans for nonaccrual status with regard to certain large-balance commercial real estate and other loans and the nonaccrual determinations made in connection with certain of those loans, certain former officers of the Bank provided inaccurate information to the Supervisors and their examiners concerning the Bank’s nonaccrual treatment controls and procedures and the nonaccrual determinations made in connection with certain large-balance commercial real estate and other loans, directed relevant information relating to those controls and procedures and certain of the nonaccrual determinations to be concealed from the Supervisors and their examiners, and failed to provide the Supervisors and their examiners with relevant information concerning those controls and procedures and certain of the nonaccrual determinations that was requested by the examiners; and

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C. Regions Bank’s senior management failed to take significant actions to comply with a supervisory directive by the Supervisors arising out of the May 2009 targeted examination to conduct an independent review of the governance structure over the Bank’s nonaccrual procedures;

WHEREAS, Regions Bank, the Supervisors, and the Federal Reserve Bank of Atlanta (the “Reserve Bank”) have the common goals that Regions Bank continues to operate in a safe and sound manner; that the Bank provides accurate and complete responses to requests for information from the Supervisors and their examiners; that the Bank continues to maintain and enhance an effective risk management program, particularly regarding its reporting of commercial real estate loans or other loans held by the Bank for nonaccrual status; and that the Bank fully complies with formal supervisory directives;

WHEREAS, the Bank’s board of directors and senior management have made progress in developing the Bank’s risk management program and the Bank’s internal controls, including internal audit and legal support have been enhanced and continue to improve; and

WHEREAS, pursuant to a resolution of the board of directors of Regions Bank dated June 10, 2014, Fournier J. Gale, III has been authorized and directed to execute this Consent Order on behalf of Regions Bank, and to consent to compliance with each and every applicable provision of this Consent Order by the Bank and its institution-affiliated parties, as defined in Sections 3(u) and 8(b)(4) of the FDI Act, 12 U.S.C. §§ 1813(u) and 1818(b)(4), and to waive any and all rights that the Bank may have pursuant to Section 8 of the FDI Act, 12 U.S.C. § 1818, including, but not limited to: (i) the issuance of a notice of charges; (ii) a hearing for the purpose

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of taking evidence in any matters set forth in this Consent Order; (iii) judicial review of this Consent Order; (iv) contest the issuance of this Consent Order by the Board of Governors; and (v) challenge or contest, in any manner, the basis, issuance, validity, terms, effectiveness or enforceability of this Consent Order or any provision hereof;

NOW, THEREFORE, before the filing of any notices, or taking of any testimony or adjudication of or finding on any issues of fact or law herein, and solely for the purpose of settling this matter without a formal proceeding being filed and without the necessity for protracted or extended hearings or testimony,

IT IS HEREBY ORDERED, that:

1. The Board of Governors, pursuant to Section 8(i)(2)(B) of the FDI Act, 12 U.S.C. § 1818(i)(2)(B), hereby assesses Regions Bank a civil money penalty in the amount of $46,000,000, to be paid to the Board of Governors at the time of the execution of this Consent Order by Fedwire transfer of immediately available funds to the Federal Reserve Bank of Richmond, ABA No. 05 1000033, beneficiary, Board of Governors of the Federal Reserve System. The Reserve Bank, on behalf of the Board of Governors, shall distribute this sum to the U.S. Department of the Treasury, pursuant to Section 8(i) of the FDI Act, 12 U.S.C. § 1818(i);

IT IS HEREBY FURTHER ORDERED, that:

2. Regions Bank hereby agrees to pay the Department a civil money penalty in the amount of $5,000,000, all of which is to be paid to the Department at the time of the execution of this Consent Order by wire transfer to BBVA Compass Bank, Routing Code Number 062001186 for credit to: State Treasurer for Banking Annual Assessments Fund Account number 28703457. This penalty, in part, covers expenses incurred by the Department as authorized pursuant to Section 5-3A-4 of the Code of Alabama, 1975; and

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IT IS HEREBY FURTHER ORDERED, by the Board of Governors, pursuant to sections 8(b)(1) and (3) of the FDI Act, 12 U.S.C. §§ 1818(b)(1) and 1818(b)(3), and the Department, pursuant to section 5-2A-12 of the Code of Alabama, 1975, that Regions Bank and its institution-affiliated parties shall take affirmative action as follows:

3. Regions Bank and its institution-affiliated parties shall continue to implement steps to improve policies, practices, controls and procedures to ensure that prompt, complete, and accurate information is provided in response to all information requests from examiners and that the practices in 2009 whereby certain former officers provided inaccurate and incomplete information to the Supervisors and their examiners does not reoccur.

4. Regions Bank and its institution-affiliated parties shall continue to implement steps to improve policies, practices, controls and procedures to ensure the accuracy of credit risk ratings, nonaccrual determinations and Allowance for Loan and Lease Losses adequacy.

5. Regions Bank and its institution-affiliated parties shall continue to implement steps to improve policies, practices, controls and procedures to ensure that all formal supervisory directives made by the Reserve Bank and the Department, specifically including all Matters Requiring Immediate Attention and Matters Requiring Attention, are tracked and are fully, accurately and timely completed and reported to the Reserve Bank and the Department.

Progress Reports

6. Within 30 days after the end of each calendar quarter following the date of this Consent Order, the board of directors or an authorized committee thereof shall submit to the Reserve Bank and the Department written progress reports detailing the form and manner of all actions taken to secure compliance with the provisions of this Consent Order and the results thereof.

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Notices

7. All communications regarding this Consent Order shall be sent to:

(a) Michael Johnson

Senior Vice-President

Federal Reserve Bank of Atlanta

1000 Peachtree Street NE

Atlanta, Georgia 30309

(b) John D. Harrison

Superintendent of Banks

Alabama State Banking Department

401 Adams Avenue, Suite 680

Montgomery, Alabama 36104

(c) Fournier J. Gale, III.

General Counsel

Regions Bank

Regions Center, 21^st Floor

1900 5^th Avenue North

Birmingham, Alabama 35203

Miscellaneous

8. The provisions of this Consent Order shall be binding on Regions Bank and each of its institution-affiliated parties in their capacities as such, and their successors and assigns.

9. Each provision of this Consent Order shall remain effective and enforceable until stayed, modified, terminated, or suspended in writing by the Supervisors.

10. Except as provided for in this Consent Order, the Board of Governors and the Department hereby release and discharge Regions Bank and its affiliates, successors and assigns from all potential liability that has been or might have been asserted by the Board of Governors or the Department based on the conduct that is the subject of this Consent Order. The foregoing release and discharge shall not preclude or affect any right of the Board of Governors or the Department to determine and ensure compliance with this Consent Order or any proceedings brought by the Board of Governors or the Department to enforce the terms of this Consent Order.

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11. Nothing in this Consent Order, express or implied, shall give to any person or entity, other than the parties hereto and their successors hereunder, any legal or equitable right, remedy, or claim under this Consent Order.

12. The provisions of this Consent Order shall not bar, estop, or otherwise prevent the Board of Governors, the Reserve Bank, the Department, or any other federal or state agency from taking any further or other action affecting Regions Bank, any subsidiary thereof, except as provided in paragraph 10, or any of their current or former institution-affiliated parties or their successors or assigns.

By Order of the Board of Governors of the Federal Reserve System and the Alabama State Banking Department effective this 25 day of June, 2014.

REGIONS BANK		BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM
By:	/s/ Fournier J. Gale, III.	By:	/s/ Robert deV. Frierson
	Fournier J. Gale, III.		Robert deV. Frierson
	General Counsel		Secretary of the Board
		ALABAMA STATE BANKING DEPARTMENT
		By:	/s/ John D. Harrison
			John D. Harrison
			Superintendent of Banks

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EX-99.1

Exhibit 99.1

Media Contact:	Investor Relations Contacts:
Evelyn Mitchell	List Underwood
205-264-4551	Dana Nolan
	205-801-0265

Regions Financial Reaches Agreements with the SEC, Federal Reserve and Alabama State Banking Department to Resolve 2009 Loan Accounting Issue

BIRMINGHAM, Ala. – (BUSINESS WIRE) –June 25, 2014 – Regions Financial Corp. (NYSE:RF) announced today that it has entered into a deferred prosecution agreement with the Securities and Exchange Commission and that Regions Bank, the principal banking subsidiary of Regions Financial Corporation, has entered into a consent order with the Federal Reserve Board of Governors and the Alabama State Banking Department. These agreements resolve previously disclosed regulatory inquiries involving the accounting for certain problem loans at the end of the first quarter of 2009.

Under the terms of the agreements, Regions Bank will pay a $51 million civil money penalty. As previously disclosed, the company established a reserve in the fourth quarter of 2013 sufficient to cover this matter.

In its agreement, the SEC noted that Regions “provided extensive cooperation” throughout the investigation. Since the financial crisis, Regions has returned to sustainable profitability, significantly reduced credit losses, and strengthened its executive management team, including naming a new CEO and chairman as well as a new chief financial officer, general counsel, deputy general counsel, chief risk officer, and chief credit officer. In addition, Regions has significantly strengthened its risk management team and processes, including creating an Ethics Council, restructuring credit and problem asset management, enhancing loan portfolio analytics capabilities, and strengthening governance and Board oversight.

About Regions Financial Corporation

Regions Financial Corporation (NYSE:RF), with $118 billion in assets, is a member of the S&P 500 Index and is one of the nation’s largest full-service providers of consumer and commercial banking, wealth management, mortgage, and insurance products and services. Regions serves customers in 16 states across the South, Midwest and Texas, and through its subsidiary, Regions Bank, operates approximately 1,700 banking offices and 2,000 ATMs. Additional information about Regions and its full line of products and services can be found at www.regions.com.

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