Regions Bank 2008 Annual Report Download - page 15

loan association, if after such acquisition, the bank holding company will directly or indirectly own or control
more than 5.0% of the voting shares of the institution; (2) it or any of its subsidiaries, other than a bank, may
acquire all or substantially all of the assets of any bank or savings and loan association; or (3) it may merge or
consolidate with any other bank holding company.
The BHC Act further provides that the Federal Reserve may not approve any transaction that would result in
a monopoly or would be in furtherance of any combination or conspiracy to monopolize or attempt to
monopolize the business of banking in any section of the United States, or the effect of which may be
substantially to lessen competition or to tend to create a monopoly in any section of the country, or that in any
other manner would be in restraint of trade, unless the anticompetitive effects of the proposed transaction are
clearly outweighed by the public interest in meeting the convenience and needs of the community to be served.
The Federal Reserve is also required to consider the financial and managerial resources and future prospects of
the bank holding companies and banks concerned and the convenience and needs of the community to be served.
Consideration of financial resources generally focuses on capital adequacy, and consideration of convenience and
needs issues includes the parties’ performance under the CRA, both of which are discussed below. In addition,
the Federal Reserve must take into account the institutions’ effectiveness in combating money laundering.
Regions Bank is a member of the FDIC, and, as such, its deposits are insured by the FDIC to the extent
provided by law. It is also subject to numerous statutes and regulations that affect its business activities and
operations, and is supervised and examined by one or more state or federal bank regulatory agencies. See “FDIC
Temporary Liquidity Guarantee Program” below.
Regions Bank is a state bank, chartered in Alabama and is a member of the Federal Reserve System.
Regions Bank is generally subject to supervision and examination by both the Federal Reserve and the Alabama
Department of Banking. The Federal Reserve and the Alabama Department of Banking regularly examine the
operations of Regions Bank and are given authority to approve or disapprove mergers, consolidations, the
establishment of branches and similar corporate actions. The federal and state banking regulators also have the
power to prevent the continuance or development of unsafe or unsound banking practices or other violations of
law. Various consumer laws and regulations also affect the operations of Regions Bank. In addition, commercial
banks are affected significantly by the actions of the Federal Reserve as it attempts to control money and credit
availability in order to influence the economy.
Community Reinvestment Act. Regions Bank is subject to the provisions of the CRA. Under the terms of
the CRA, Regions Bank has a continuing and affirmative obligation consistent with safe and sound operation to
help meet the credit needs of its communities, including providing credit to individuals residing in low- and
moderate-income neighborhoods. The CRA does not establish specific lending requirements or programs for
financial institutions nor does it limit an institution’s discretion to develop the types of products and services that
it believes are best suited to its particular community, consistent with the CRA. The CRA requires each
appropriate federal bank regulatory agency, in connection with its examination of a depository institution, to
assess such institution’s record in assessing and meeting the credit needs of the community served by that
institution, including low- and moderate-income neighborhoods. The regulatory agency’s assessment of the
institution’s record is made available to the public. The assessment also is part of the Federal Reserve’s
consideration of applications to acquire, merge or consolidate with another banking institution or its holding
company, to establish a new branch office that will accept deposits or to relocate an office. In the case of a bank
holding company applying for approval to acquire a bank or other bank holding company, the Federal Reserve
will assess the records of each subsidiary depository institution of the applicant bank holding company, and such
records may be the basis for denying the application. Regions Bank received a “satisfactory” CRA rating in its
most recent examination.
USA PATRIOT Act. A major focus of governmental policy relating to financial institutions in recent years
has been aimed at combating money laundering and terrorist financing. The USA PATRIOT Act of 2001 (the
“USA PATRIOT Act”) broadened the application of anti-money laundering regulations to apply to additional
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