Regions Bank 2008 Annual Report Download - page 142

As of December 31, 2008, the amount of non-vested stock options and restricted stock awards and units not
yet recognized was $102.3 million, which will be recognized over a weighted-average period of 1.7 years. No
share-based compensation costs were capitalized during the years ended December 31, 2008, 2007 and 2006.
NOTE 19. PENSION AND OTHER EMPLOYEE BENEFIT PLANS
PENSION AND OTHER POSTRETIREMENT BENEFIT PLANS
Regions has a defined-benefit pension plan (the “Regions pension plan”) covering substantially all
employees employed at or before December 31, 2000. After January 1, 2001, the Regions pension plan was
closed to new entrants. Benefits under the Regions pension plan are based on years of service and the employee’s
highest five years of compensation during the last ten years of employment. Regions’ funding policy is to
contribute annually at least the amount required by Internal Revenue Service minimum funding standards.
Contributions are intended to provide not only for benefits attributed to service to date, but also for those
expected to be earned in the future. The Company also sponsors a supplemental executive retirement program
(the “Regions SERP”), which is a non-qualified plan that provides certain senior executive officers defined
pension benefits in relation to their compensation. Regions also sponsors a defined-benefit postretirement health
care plan that covers certain retired employees. Currently, the Company pays a portion of the costs of certain
health care benefits for all eligible employees who retired before January 1, 1989. No health care benefits are
provided for employees retiring at normal retirement age after December 31, 1988. For employees retiring before
normal retirement age, the Company currently pays a portion of the costs of certain health care benefits until the
retired employee becomes eligible for Medicare. Certain retirees, participating in plans of acquired entities, are
offered a Medicare supplemental benefit. The plan is contributory and contains other cost-sharing features such
as deductibles and co-payments. Retiree health care benefits, as well as similar benefits for active employees, are
provided through a self-insured program in which Company and retiree costs are based on the amount of benefits
paid. The Company’s policy is to fund the Company’s share of the cost of health care benefits in amounts
determined at the discretion of management.
As a result of the merger with AmSouth, Regions assumed the obligations related to AmSouth’s employee
benefit plans. One of these assumed plans is a defined-benefit pension plan (the “AmSouth pension plan”)
covering substantially all regular full-time employees and part-time employees who regularly work 1,000 hours
or more each year and were employed at AmSouth at or before the merger. Subsequent to the merger, the
AmSouth pension plan was closed to new participants. Regions also assumed AmSouth’s non-qualified
supplemental executive retirement plan (the “AmSouth SERP”), which provides additional benefits to certain
senior executives. Effective September 30, 2007, the Regions pension plan and AmSouth pension plan were
merged into one plan. The benefit structures of each former plan remain intact.
Regions also assumed postretirement medical plans from AmSouth. These plans provide postretirement
medical benefits to all legacy AmSouth employees who retire between the ages of 55 and 65 with five or more
calendar years of service and provide certain retired and grandfathered retired participants with postretirement
benefits past age 65. Postretirement life insurance is also provided to a grandfathered group of employees and
retirees.
Actuarially determined pension expense is charged to current operations using the projected unit credit
method. Expense associated with the SERP and postretirement benefit plans is charged to current operations
based on actuarial calculations.
As a result of adopting FAS 158 on December 31, 2006, Regions transitioned from a September 30
measurement date to a December 31 measurement date during 2008. The effect of this transition was not material
to the consolidated financial statements.
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