- Birmingham-based Regions Financial Corp.'s stock plummeted 41 percent on Monday, but CEO Dowd Ritter expressed confidence in the strength of his company's Main Street business amid turmoil on Wall Street. "You hear all this Wall Street, Main Street talk. We really are a Main Street bank," Ritter said, adding that the bank services consumers and small businesses across its 16-state footprint. "We're not tied up with massive multibillion-dollar agreements there on Wall Street."
- Ritter noted that while other banks are writing off billions every quarter, Regions has so far made about a half-billion in profit this year. "There's a pretty simple reason," he said. "We always have taken a very conservative approach to our business. At times, we may not be doing what is in vogue, but that plain vanilla banking plays very well in times like this."
- Ritter said Regions is well-capitalized by regulatory standards, as evidenced by its recent takeover of the failed Georgia-based Integrity Bank last month, at the request of the Federal Deposit Insurance Corp. (yes that's why I bought the stock - only to lose 40% in 1 day, but back up 25% today - what a casino) "We are a safe harbor, if you will, for deposits," he said.
- He also noted that Regions is not burdened with exotic securities and risky mortgages that have prompted the demise of other institutions. Regions has few subprime mortgages in its entire portfolio, he said. "All that said, it doesn't matter whether we're lucky or smart, we've avoided the real troubled areas that are plaguing many in this industry," he said.
- Industry watchers acknowledged the growing concern about Regions' health, adding that the Wachovia news likely dragged down the bank's stock on Monday. "Regions keeps telling us they don't have these same problems, and only Regions and the FDIC know for sure," said Andreas Rauterkus, associate finance professor at the University of Alabama at Birmingham's business school. "You are guilty by association these days in the financial industry, so you never know." (unless you are Wells Fargo or JP Morgan)
- Ritter said that on Friday, the bank had one of its largest deposit growth days in his career, as people brought over their money from other banks amid worry about the health of those institutions. "What people generally want to know and should be concerned about is: Is their bank strong; is it profitable, and is their business going to be safe? At Regions, the answer is absolutely yes," he said.
Long Regions Financial in fund and personal account