Regions Financial Closes Acquisition Of Highland Associates

Regions Financial Corporation (NYSE:RF) has concluded the acquisition of Highland Associates — a leading institutional investment firm — announced in June 2019.

John Turner, President and CEO of Regions Financial, said, “Through our combined team, we will bring additional expertise and capabilities to support more clients and continue to diversify our business, in line with our strategic objectives.”

Highland Associates is a provider of objective, research-driven investment counsel to not-for-profit healthcare entities and mission-based organizations.

With this buyout, Regions Financial’s existing asset management and healthcare banking will get a boost as it adds additional capabilities that will help meet client needs.

Per the terms, Highland Associates will retain its name, leadership, employees and investment philosophy, while operating as a subsidiary of Regions Bank and reporting through the Regions Wealth Management Group.

Regions Financial has long relied on inorganic expansion for growth. Over the last few years, the company underwent an acquisition spree to boost its diversified business, which we believe might support its growth prospects.

For the second quarter, Regions Financial reported income from continuing operations available to common shareholders of $374 million compared with $362 million in the year-ago quarter. The results benefited from lower expenses and higher net interest income. However, lower fee income, backed by reduced capital markets and mortgage banking income, were major drags.

Notably, Regions Financial continues to take actions with respect to its Simplify and Grow initiative, including streamlining its structure and refining its branch network while making investments in new technologies, delivery channels and other growth drivers. These are likely to aid its profitability in the coming quarters.

Shares of the company have gained 14.6% year to date compared with 13.4% growth recorded by the industry it belongs to.

The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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