BIRMINGHAM (ALABAMA) (dpa-AFX) - Regions Financial Corp. (RF) announced, for 2019, it targets: adjusted average loan growth in the low single digits; and adjusted total revenue growth of 2-4 percent. For the three-year period (2019-2021), Regions Financial projects: 2021 adjusted return on average tangible common equity of 18-20 percent; 2021 adjusted efficiency ratio less than 55 percent; and annual positive operating leverage.
Under the strategic growth plan, over the next three years, the company will continue expanding digital banking capabilities, such as online account openings, digital loan applications, and wealth management digital advisory capabilities while also consolidating branches across its service area. The company will pursue opportunistic hiring and de novo branch expansion in key growth markets including Atlanta, Houston, and Orlando.
Regions Financial announced it has allocated approximately $625 million in the current year, or 11 percent of 2018 revenue, for technology investments, with nearly half of that budget dedicated to new projects. Over the next three years, Regions will pilot voice banking capabilities and expand its use of artificial intelligence for both customer-facing and back-office applications.
Regions said it is committed to achieving an adjusted efficiency ratio of less than 55 percent by 2021 by growing revenue and aggressively managing expenses. Regions continues to reduce its real estate square footage through branch and back-office space consolidations, introduction of collaborative workspaces, hoteling, and expanding remote work options. The company is in the process of exiting 2.1 million square feet, resulting in a 15 percent reduction in total branch and non-branch space between 2017 and 2021. Regions said the company is also delivering reductions in third-party spending through strategic sourcing and vendor selectivity and anticipates annual cumulative savings of approximately $60 million between 2018 and 2021.
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