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Fair Value Measurements
 3 Months Ended
Mar. 31, 2023
Fair Value Disclosures [Abstract]  
Fair Value Measurements
See Note 1 "Summary of Significant Accounting Policies" to the consolidated financial statements of the Annual Report on Form 10-K for the year ended December 31, 2022 for a description of valuation methodologies for assets and liabilities measured at fair value on a recurring and non-recurring basis. Assets and liabilities measured at fair value rarely transfer between Level 1 and Level 2 measurements. Marketable equity securities and debt securities available for sale may be periodically transferred to or from Level 3 valuation based on management’s conclusion regarding the observability of inputs used in valuing the securities. Such transfers are accounted for as if they occur at the beginning of a reporting period.
The following table presents assets and liabilities measured at estimated fair value on a recurring basis:
 March 31, 2023December 31, 2022
 Level 1Level 2
Level 3 (1)
Total
Estimated Fair Value		Level 1Level 2
Level 3 (1)
Total
Estimated Fair Value
 (In millions)
Recurring fair value measurements
Debt securities available for sale:
U.S. Treasury securities$1,205 $— $— $1,205 $1,187 $— $— $1,187 
Federal agency securities— 946 — 946 — 836 — 836 
Obligations of states and political subdivisions— 2 — 2 — 2 — 2 
Mortgage-backed securities:
Residential agency— 17,165 — 17,165 — 16,954 — 16,954 
Residential non-agency— — — — — — 1 1 
Commercial agency— 7,657 — 7,657 — 7,613 — 7,613 
Commercial non-agency— 123 — 123 — 186 — 186 
Corporate and other debt securities— 1,130 2 1,132 — 1,153 1 1,154 
Total debt securities available for sale$1,205 $27,023 $2 $28,230 $1,187 $26,744 $2 $27,933 
Loans held for sale$— $223 $19 $242 $— $177 $19 $196 
Marketable equity securities in other earning assets$650 $— $— $650 $529 $— $— $529 
Residential mortgage servicing rights$— $— $790 $790 $— $— $812 $812 
Derivative assets (2):
Interest rate swaps$— $2,036 $— $2,036 $— $2,335 $— $2,335 
Interest rate options— 97 9 106 — 91 3 94 
Interest rate futures and forward commitments— 7 — 7 — 8 — 8 
Other contracts— 197 — 197 3 169 — 172 
Total derivative assets$— $2,337 $9 $2,346 $3 $2,603 $3 $2,609 
Derivative liabilities (2):
Interest rate swaps$— $2,569 $— $2,569 $— $3,161 $— $3,161 
Interest rate options— 87 — 87 — 85 — 85 
Interest rate futures and forward commitments— 6 — 6 — 5 — 5 
Other contracts2 187 1 190 2 124 1 127 
Total derivative liabilities$2 $2,849 $1 $2,852 $2 $3,375 $1 $3,378 
_________
(1)All following disclosures related to Level 3 recurring assets do not include those deemed to be immaterial.
(2)As permitted under U.S. GAAP, variation margin collateral payments made or received for derivatives that are centrally cleared are legally characterized as settled. As such, these derivative assets and derivative liabilities and the related variation margin collateral are presented on a net basis on the balance sheet.
Assets and liabilities in all levels could result in volatile and material price fluctuations. Realized and unrealized gains and losses on Level 3 assets represent only a portion of the risk to market fluctuations in Regions’ consolidated balance sheets. Further, derivatives included in Levels 2 and 3 are used by ALCO in a holistic approach to managing price fluctuation risks.
The following tables present an analysis for residential MSRs for the three months ended March 31, 2023 and 2022, respectively.
.
 Residential mortgage servicing rights
Three Months Ended March 31
20232022
(In millions)
Carrying value, beginning of period$812 $418 
Total realized/unrealized gains (losses) included in earnings (1)
(36)30 
Additions4 19 
Purchases10 75 
Carrying value, end of period$790 $542 
_______
(1) Included in mortgage income. Amounts presented exclude offsetting impact from related derivatives.
RECURRING FAIR VALUE MEASUREMENTS USING SIGNIFICANT UNOBSERVABLE INPUTS
The significant unobservable inputs used in the fair value measurement of residential MSRs are OAS and CPR. This valuation requires generating cash flow projections over multiple interest rate scenarios and discounting those cash flows at a risk-adjusted rate. Additionally, the impact of prepayments and changes in the OAS are based on a variety of underlying inputs including servicing costs. Increases or decreases to the underlying cash flow inputs will have a corresponding impact on the value of the MSR asset. The net change in unrealized gains (losses) included in earnings related to MSRs held at period end are disclosed as the changes in valuation inputs or assumptions included in the MSR rollforward table in Note 4 .
The following tables present detailed information regarding material assets and liabilities measured at fair value using significant unobservable inputs (Level 3) as of March 31, 2023, and December 31, 2022. The tables include the valuation techniques and the significant unobservable inputs utilized. The range of each significant unobservable input as well as the weighted-average within the range utilized at March 31, 2023 and December 31, 2022 are included. Following the tables are descriptions of the valuation techniques and the sensitivity of the techniques to changes in the significant unobservable inputs.
 March 31, 2023
 
Level 3
Estimated Fair Value at
March 31, 2023
Valuation
Technique		Unobservable
Input(s)		Quantitative Range of
Unobservable Inputs and
(Weighted-Average)
 (Dollars in millions)
Recurring fair value measurements:
Residential mortgage servicing rights (1)
$790Discounted cash flowWeighted-average CPR (%)
6.2% - 18.5% (7.7%)
OAS (%)
5.2% - 8.2% (5.5%)
_________
(1)See Note 4 for additional disclosures related to assumptions used in the fair value calculation for residential mortgage servicing rights.

 December 31, 2022
 
Level 3
Estimated Fair Value at
December 31, 2022
Valuation
Technique		Unobservable
Input(s)		Quantitative Range of
Unobservable Inputs and
(Weighted-Average)
 (Dollars in millions)
Recurring fair value measurements:
Residential mortgage servicing rights (1)
$812Discounted cash flowWeighted-average CPR (%)
6.1% - 15.1% (7.4%)
OAS (%)
4.8% -8.2% (5.1%)
_______
(1)See Note 6 to the consolidated financial statements of the Annual Report on Form 10-K for the year ended December 31, 2022 for additional disclosures related to assumptions used in the fair value calculation for residential mortgage servicing rights.
FAIR VALUE OPTION
As discussed above, the Company elected the option to measure certain commercial mortgage loans held for sale at fair value. At March 31, 2023 and December 31, 2022, the balance of these loans was immaterial.
The Company has elected the option to measure certain commercial and industrial loans held for sale at fair value, as these loans are actively traded in the secondary market. The Company is able to obtain fair value estimates for substantially all of these loans through a third party valuation service that is broadly used by market participants. While most of the loans are traded in the market, the volume and level of trading activity is subject to variability and the loans are not exchange-traded. The balance of these loans held for sale was immaterial at March 31, 2023 and December 31, 2022.
Regions has elected the fair value option for all eligible agency residential first mortgage loans originated with the intent to sell. This election allows for a more effective offset of the changes in fair values of the loans and the derivative instruments used to economically hedge them without the burden of complying with the requirements for hedge accounting. Fair values of residential first mortgage loans held for sale are based on traded market prices of similar assets where available and/or discounted cash flows at market interest rates, adjusted for securitization activities that include servicing values and market conditions, and are recorded in loans held for sale.
The following table summarizes the difference between the aggregate fair value and the aggregate unpaid principal balance for mortgage loans held for sale measured at fair value:
 March 31, 2023December 31, 2022
 Aggregate
Fair Value		Aggregate
Unpaid
Principal		Aggregate Fair
Value Less
Aggregate
Unpaid
Principal		Aggregate
Fair Value		Aggregate
Unpaid
Principal		Aggregate Fair
Value Less
Aggregate
Unpaid
Principal
 (In millions)
Residential mortgage loans held for sale, at fair value$203 $198 $5 $160 $157 $3 
Interest income on mortgage loans held for sale is recognized based on contractual rates and is reflected in interest income on loans held for sale. The following table details net gains and losses resulting from changes in fair value of residential mortgage loans held for sale, which were recorded in mortgage income in the consolidated statements of income during the three months ended March 31, 2023 and 2022. These changes in fair value are mostly offset by economic hedging activities. An immaterial portion of these amounts was attributable to changes in instrument-specific credit risk.
Three Months Ended March 31
 20232022
 (In millions)
Net gains (losses) resulting from changes in fair value of residential mortgage loans held for sale$2 $(23)
NON-RECURRING FAIR VALUE MEASUREMENTS
Items measured at fair value on a non-recurring basis include loans held for sale for which the fair value option has not been elected, foreclosed property and other real estate and equity investments without a readily determinable fair value; all of which may be considered either Level 2 or Level 3 valuation measurements. Non-recurring fair value adjustments related to loans held for sale, foreclosed property and other real estate are typically a result of the application of lower of cost or fair value accounting during the period. Non-recurring fair value adjustments related to equity investments without readily determinable fair values are the result of impairments or price changes from observable transactions. The balances of each of these assets, as well as the related fair value adjustments during the periods, were immaterial at both March 31, 2023 and December 31, 2022.
FAIR VALUE OF FINANCIAL INSTRUMENTS
The carrying amounts and estimated fair values, as well as the level within the fair value hierarchy, of the Company’s financial instruments as of March 31, 2023 are as follows:
 March 31, 2023
 Carrying
Amount
Estimated
Fair
Value(1)
Level 1Level 2Level 3
 (In millions)
Financial assets:
Cash and cash equivalents$8,833 $8,833 $8,833 $— $— 
Debt securities held to maturity790 749 — 749 — 
Debt securities available for sale28,230 28,230 1,205 27,023 2 
Loans held for sale564 564 — 545 19 
Loans (excluding leases), net of unearned income and allowance for loan losses(2)(3)
95,095 91,198 — — 91,198 
Other earning assets1,335 1,335 650 685 — 
Derivative assets2,346 2,346 — 2,337 9 
Financial liabilities:
Derivative liabilities2,852 2,852 2 2,849 1 
Deposits with no stated maturity(4)
120,687 120,687 — 120,687 — 
Time deposits(4)
7,773 7,668 — 7,668 — 
Short-term borrowings2,000 2,000 — 2,000 — 
Long-term borrowings2,307 2,301 — 2,300 1 
Loan commitments and letters of credit156 156 — — 156 
_________
(1)Estimated fair values are consistent with an exit price concept. The assumptions used to estimate the fair values are intended to approximate those that a market participant would use in a hypothetical orderly transaction. In estimating fair value, the Company makes adjustments for estimated changes in interest rates, market liquidity and credit spreads in the periods they are deemed to have occurred.
(2)The estimated fair value of portfolio loans assumes sale of the loans to a third-party financial investor. Accordingly, the value to the Company if the loans were held to maturity is not reflected in the fair value estimate. The fair value discount on the loan portfolio's net carrying amount at March 31, 2023 was $3.9 billion or 4.1 percent.
(3)Excluded from this table is the sales-type, direct financing, and leveraged lease carrying amount of $1.5 billion at March 31, 2023.
(4)The fair value of non-interest-bearing demand accounts, interest-bearing checking accounts, savings accounts, and money market accounts is the amount payable on demand at the reporting date (i.e., the carrying amount) as these instruments have an indeterminate maturity date. Fair values for time deposits are estimated by using discounted cash flow analyses, based on market spreads to benchmark rates.
The carrying amounts and estimated fair values, as well as the level within the fair value hierarchy, of the Company's financial instruments as of December 31, 2022 are as follows:
 December 31, 2022
 Carrying
Amount
Estimated
Fair
Value(1)
Level 1Level 2Level 3
 (In millions)
Financial assets:
Cash and cash equivalents$11,227 $11,227 $11,227 $— $— 
Debt securities held to maturity801 751 — 751 — 
Debt securities available for sale27,933 27,933 1,187 26,744 2 
Loans held for sale354 354 — 335 19 
Loans (excluding leases), net of unearned income and allowance for loan losses(2)(3)
94,044 89,540 — — 89,540 
Other earning assets 1,308 1,308 529 779 — 
Derivative assets2,609 2,609 3 2,603 3 
Financial liabilities:
Derivative liabilities3,378 3,378 2 3,375 1 
Deposits with no stated maturity(4)
125,971 125,971 — 125,971 — 
Time deposits(4)
5,772 5,697 — 5,697 — 
Long-term borrowings2,284 2,376 — 2,375 1 
Loan commitments and letters of credit153 153 — — 153 
_________
(1)Estimated fair values are consistent with an exit price concept. The assumptions used to estimate the fair values are intended to approximate those that a market participant would use in a hypothetical orderly transaction. In estimating fair value, the Company makes adjustments for estimated changes in interest rates, market liquidity and credit spreads in the periods they are deemed to have occurred.
(2)The estimated fair value of portfolio loans assumes sale of the loans to a third-party financial investor. Accordingly, the value to the Company if the loans were held to maturity is not reflected in the fair value estimate. The fair value discount on the loan portfolio's net carrying amount at December 31, 2022 was $4.5 billion or 4.8 percent.
(3)Excluded from this table is the sales-type, direct financing, and leveraged lease carrying amount of $1.5 billion at December 31, 2022.