Derivative Financial Instruments and Hedging Activities (Tables)

12 Months Ended

Dec. 31, 2020

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule Of Derivative Instruments Notional And Fair Values

The following tables present the notional amount and estimated fair value of derivative instruments on a gross basis as of December 31:


	2020						2019
	Notional Amount		Estimated Fair Value				Notional Amount		Estimated Fair Value
			Gain(1)		Loss(1)				Gain(1)		Loss(1)
	(In millions)
Derivatives in fair value hedging relationships:
Interest rate swaps	$	2,100	$	77	$	—	$	2,900	$	67	$	—

Derivatives in cash flow hedging relationships:
Interest rate swaps	16,000		1,181		—		17,250		338		83
Interest rate floors (2)	5,750		430		—		6,750		208		—
Total derivatives in cash flow hedging relationships	21,750		1,611		—		24,000		546		83
Total derivatives designated as hedging instruments	$	23,850	$	1,688	—		$	26,900	$	613	$	83
Derivatives not designated as hedging instruments:
Interest rate swaps	$	76,764	$	1,492	$	1,464	$	68,075	$	659	$	656
Interest rate options	13,806		90		28		11,347		27		9
Interest rate futures and forward commitments	4,270		11		26		27,324		10		11
Other contracts	9,924		68		80		10,276		48		58
Total derivatives not designated as hedging instruments	$	104,764	$	1,661	$	1,598	$	117,022	$	744	$	734
Total derivatives	$	128,614	$	3,349	$	1,598	$	143,922	$	1,357	$	817

Total gross derivative instruments, before netting			$	3,349	$	1,598			$	1,357	$	817
Less: Netting adjustments (3)			2,428		1,545				1,022		770
Total gross derivative instruments, after netting (4)			$	921	$	53			$	335	$	47

_________

(1)Derivatives in a gain position are recorded as other assets and derivatives in a loss position are recorded as other liabilities on the consolidated balance sheets.

(2)Estimated fair value includes premium of approximately $83 million as of December 31, 2020 and $108 million as of December 31, 2019 to be amortized over the remaining life. Approximately $15 million of the decrease since December 31, 2019 related to hedges that were terminated during the third quarter of 2020 and were not amortized into earnings as of the date of termination.

(3)Netting adjustments represent amounts recorded to convert derivative assets and derivative liabilities from a gross basis to a net basis in accordance with applicable accounting guidance. The net basis takes into account the impact of cash collateral received or posted, legally enforceable master netting agreements and variation margin that allow Regions to settle derivative contracts with the counterparty on a net basis and to offset the net position with the related cash collateral.

(4)The gain amounts, which are not collateralized with cash or other assets or reserved for, represent the net credit risk on all trading and other derivative positions. As of December 31, 2020 and December 31, 2019, financial instruments posted of $24 million, for both periods, were not offset in the consolidated balance sheets.

Schedule of Cash Flow Hedges Included in Accumulated Other Comprehensive Income Loss Table

The following table presents the pre-tax impact of terminated cash flow hedges on AOCI. The balance of terminated cash flow hedges in AOCI will be amortized into earnings through 2026.


	Twelve Months Ended December 31
	2020		2019
	(In millions)
Unrealized gains on terminated hedges included in AOCI- January 1	$	78	$	68
Unrealized gains on terminated hedges arising during the period	55		23
Reclassification adjustments for amortization of unrealized (gains) into net income	(12)		(13)
Unrealized gains on terminated hedges included in AOCI-December 31	$	121	$	78

Schedule Of Effect Of Hedging Derivative Instruments On Statements Of Operations

The following tables present the effect of hedging derivative instruments on the consolidated statements of income and the total amounts for the respective line items affected for the years ended December 31:


	2020
	Interest Income				Interest Expense
	Debt securities		Loans, including fees		Long-term borrowings
	(In millions)
Total amounts presented in the consolidated statements of income	$	582	$	3,610	$	178

Gains/(losses) on fair value hedging relationships:
Interest rate contracts:
Amounts related to interest settlements on derivatives	$	—	$	—	$	37
Recognized on derivatives	—		—		52
Recognized on hedged items	—		—		(51)
Net income recognized on fair value hedges	$	—	$	—	$	38

Gains/(losses) on cash flow hedging relationships: (1)
Interest rate contracts:
Realized gains (losses) reclassified from AOCI into net income (2)	$	—	$	260	$	—
Income (expense) recognized on cash flow hedges (2)	$	—	$	260	$	—


	2019
	Interest Income				Interest Expense
	Debt securities		Loans, including fees		Long-term borrowings
	(In millions)
Total amounts presented in the consolidated statements of income	$	643	$	3,866	$	351

Gains/(losses) on fair value hedging relationships:
Interest rate contracts:
Amounts related to interest settlements on derivatives	$	—	$	—	$	(14)
Recognized on derivatives	(2)		—		92
Recognized on hedged items	2		—		(92)
Net income recognized on fair value hedges	$	—	$	—	$	(14)

Gains/(losses) on cash flow hedging relationships: (1)
Interest rate contracts:
Realized gains (losses) reclassified from AOCI into net income (2)	$	—	$	(24)	$	—
Income (expense) recognized on cash flow hedges(2)	$	—	$	(24)	$	—


	2018
	Interest Income				Interest Expense
	Debt securities		Loans, including fees		Long-term borrowings
	(In millions)
Total amounts presented in the consolidated statements of income	$	625	$	3,613	$	322

Gains/(losses) on fair value hedging relationships:
Interest rate contracts:
Amounts related to interest settlements on derivatives	$	(1)	$	—	$	(15)
Recognized on derivatives	4		—		1
Recognized on hedged items	(4)		—		(1)
Net income recognized on fair value hedges	$	(1)	$	—	$	(15)

Gains/(losses) on cash flow hedging relationships: (1)
Interest rate contracts:
Realized gains (losses) reclassified from AOCI into net income (2)	$	—	$	12	$	—
Income (expense) recognized on cash flow hedges(2)	$	—	$	12	$	—

____

(1)See Note 15 for gain or (loss) recognized for cash flow hedges in AOCI.

(2)Pre-tax

Schedule of Fair Value Hedging Basis Adjustments

The following tables present the carrying amount and associated cumulative basis adjustment related to the application of hedge accounting that is included in the carrying amount of hedged assets and liabilities in fair value hedging relationships as of December 31:


	2020		2019
	Hedged Items Currently Designated			Hedged Items Currently Designated
	Carrying Amount of Assets/(Liabilities)	Hedge Accounting Basis Adjustment			Carrying Amount of Assets/(Liabilities)	Hedge Accounting Basis Adjustment
	(In millions)		(In millions)

Long-term borrowings	(2,171)	(64)			(2,954)	(49)

Schedule Of Gains (Losses) Recognized In Income Related To Derivatives Not Designated As Hedging Instruments

The following table presents the location and amount of gain or (loss) recognized in income on derivatives not designated as hedging instruments in the consolidated statements of income for the years ended December 31:


Derivatives Not Designated as Hedging Instruments	2020		2019		2018
	(In millions)
Capital markets income:
Interest rate swaps	$	21	$	13	$	19
Interest rate options	36		23		28
Interest rate futures and forward commitments	14		10		3
Other contracts	1		(1)		5
Total capital markets income	72		45		55
Mortgage income:
Interest rate swaps	83		68		(12)
Interest rate options	30		(1)		—
Interest rate futures and forward commitments	(2)		5		(8)
Total mortgage income	111		72		(20)
	$	183	$	117	$	35