Derivative Financial Instruments and Hedging Activities (Tables)

12 Months Ended

Dec. 31, 2021

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:


	2021						2020
	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	$	7,900	$	—	$	32	$	2,100	$	77	$	—

Derivatives in cash flow hedging relationships:
Interest rate swaps (2)	20,650		171		29		16,000		1,181		—
Interest rate floors (3)	—		—		—		5,750		430		—
Total derivatives in cash flow hedging relationships	20,650		171		29		21,750		1,611		—
Total derivatives designated as hedging instruments	$	28,550	$	171	61		$	23,850	$	1,688	$	—
Derivatives not designated as hedging instruments:
Interest rate swaps	$	81,327	$	748	$	794	$	76,764	$	1,492	$	1,464
Interest rate options	15,990		48		19		13,806		90		28
Interest rate futures and forward commitments	2,739		11		3		4,270		11		26
Other contracts	9,456		133		135		9,924		68		80
Total derivatives not designated as hedging instruments	$	109,512	$	940	$	951	$	104,764	$	1,661	$	1,598
Total derivatives	$	138,062	$	1,111	$	1,012	$	128,614	$	3,349	$	1,598

Total gross derivative instruments, before netting			$	1,111	$	1,012			$	3,349	$	1,598
Less: Netting adjustments (4)			699		932				2,428		1,545
Total gross derivative instruments, after netting (5)			$	412	$	80			$	921	$	53

_________

(1)Derivatives in a gain position are recorded as other assets and derivatives in a loss position are recorded as other liabilities.

(2)Includes accrued interest of $12 million as of December 31, 2021 and $28 million at December 31, 2020, respectively.

(3)Includes accrued interest of $12 million and premium of approximately $83 million at December 31, 2020.

(4)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.

(5)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, 2021, there were no financial instruments posted that were not offset in the consolidated balance sheets, compared to $24 million as of December 31, 2020.

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
	2021		2020
	(In millions)
Unrealized gains on terminated hedges included in AOCI - January 1	$	121	$	78
Unrealized gains on terminated hedges arising during the period	739		55
Reclassification adjustments for amortization of unrealized (gains) into net income	(160)		(12)
Unrealized gains on terminated hedges included in AOCI - December 31	$	700	$	121

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:


	2021
	Interest Income		Interest Expense
	Loans, including fees		Long-term borrowings
	(In millions)
Total income (expense) presented in the consolidated statements of income	$	3,452	(103		)

Gains/(losses) on fair value hedging relationships:
Interest rate contracts:
Amounts related to interest settlements on derivatives	$	—	$	19
Recognized on derivatives	—		(51)
Recognized on hedged items	—		51
Income (expense) recognized on fair value hedges	$	—	$	19

Gains/(losses) on cash flow hedging relationships: (1)
Interest rate contracts:
Realized gains (losses) reclassified from AOCI into net income (2)	$	426	$	—
Income (expense) recognized on cash flow hedges (2)	$	426	$	—


	2020
	Interest Income		Interest Expense
	Loans, including fees		Long-term borrowings
	(In millions)
Total income (expense) presented in the consolidated statements of income	$	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)
Income (expense) 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 income (expense) 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)
Income (expense) 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)	$	—

____

(1)See Note 14 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:


	2021				2020
	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)
Debt securities available for sale(1)(2)	$	9,901	$	—			$	—	$	—
Long-term borrowings	(1,363)		34				(2,171)		(64)

_____

(1) Carrying amount represents amortized cost.

(2) In the fourth quarter of 2021, the Company designated interest rate swaps as fair value hedges of debt securities available for sale under the last-of-layer method, which are included in this amount. As of December 31, 2021, the Company has designated $5.8 billion as the hedged amount from a closed portfolio of prepayable financial assets with a carrying amount of $9.1 billion.

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 for the years ended December 31:


Derivatives Not Designated as Hedging Instruments	2021		2020		2019
	(In millions)
Capital markets income:
Interest rate swaps	$	46	$	21	$	13
Interest rate options	28		36		23
Interest rate futures and forward commitments	15		14		10
Other contracts	4		1		(1)
Total capital markets income	93		72		45
Mortgage income:
Interest rate swaps	(45)		83		68
Interest rate options	(32)		30		(1)
Interest rate futures and forward commitments	13		(2)		5
Total mortgage income	(64)		111		72
	$	29	$	183	$	117