Borrowings

12 Months Ended

Dec. 31, 2022

LONG-TERM BORROWINGS

Long-term borrowings at December 31 consist of the following:


	2022		2021
	(In millions)
Regions Financial Corporation (Parent):
2.25% senior notes due May 2025	$	747	$	746
1.80% senior notes due August 2028	646		645
7.75% subordinated notes due September 2024	100		100
6.75% subordinated debentures due November 2025	153		154
7.375% subordinated notes due December 2037	298		298
Valuation adjustments on hedged long-term debt	(158)		(34)
	1,786		1,909
Regions Bank:



6.45% subordinated notes due June 2037	496		496
Other long-term debt	2		2

	498		498
Total consolidated	$	2,284	$	2,407

As of December 31, 2022, Regions had three issuances and Regions Bank had one issuance of subordinated notes totaling $551 million and $496 million, respectively, with stated interest rates ranging from 6.45% to 7.75%. All issuances of these notes are, by definition, subordinated and subject in right of payment of both principal and interest to the prior payment in full of all senior indebtedness of the Company, which is generally defined as all indebtedness and other obligations of the Company to its creditors, except subordinated indebtedness. Payment of the principal of the notes may be accelerated only in the case of certain events involving bankruptcy, insolvency proceedings or reorganization of the Company. The subordinated notes described above qualify as Tier 2 capital under Federal Reserve guidelines, subject to diminishing credit as the respective maturity dates approach and subject to certain transition provisions. None of the subordinated notes are redeemable prior to maturity, unless there is an occurrence of a qualifying capital event.

Regions and Regions Bank did not issue or redeem any debt in 2022.

In the first quarter of 2021, Regions and Regions Bank redeemed senior notes due February 2021 and April 2021 in their entirety. In the third quarter of 2021, Regions issued $650 million of 1.80% senior notes due August 2028. Also in the third quarter of 2021, Regions redeemed senior notes due August 2023 in their entirety. In conjunction with the redemptions, Regions incurred related early extinguishment pre-tax charges totaling $20 million.

Regions uses derivative instruments, primarily interest rate swaps, to manage interest rate risk by converting a portion of its fixed-rate debt to a variable-rate. The effective rate adjustments related to these hedges are included in interest expense on long-term borrowings. The weighted-average interest rate on total long-term debt, including the effect of derivative instruments, was 5.1 percent, 3.6 percent, and 2.7 percent for the years ended December 31, 2022, 2021 and 2020, respectively. Further discussion of derivative instruments is included in Note 20.

The aggregate amount of contractual maturities of all long-term debt in each of the next five years and thereafter is as follows:


	Year Ended December 31
	Regions Financial Corporation (Parent)		Regions Bank
	(In millions)
2023	$	—	$	—
2024	100		—
2025	833		—
2026	—		—
2027	—		—
Thereafter	853		498
	$	1,786	$	498

Regions Bank maintains borrowing capacity at the FHLB and the FRB. Short and long-term funding from the FHLB and FRB are secured by pledged assets, primarily certain loan portfolios which are also subject to blanket lien arrangements with the FHLB and FRB. Borrowing capacity with the FHLB and FRB is contingent on the amount of collateral available to be pledged. At both December 31, 2022 and 2021 there were no outstanding borrowings with the FHLB or FRB.

On February 24, 2022, Regions filed a shelf registration statement with the SEC. This shelf registration does not have a capacity limit and can be utilized by Regions to issue various debt and/or equity securities. The registration statement will expire in February 2025.

Regions Bank may issue bank notes from time to time, either as part of a bank note program or as stand-alone issuances. Notes issued by Regions Bank may be senior or subordinated notes. Notes issued by Regions Bank are not deposits and are not insured or guaranteed by the FDIC.

Regions may, from time to time, consider opportunistically retiring outstanding issued securities, including subordinated debt in privately negotiated or open market transactions. Regulatory approval would be required for retirement of some securities.