Regions Financial to Raise $1.25B

BIRMINGHAM, Ala. -- Regions Financial(RF) said Wednesday that it plans to raise $1.25 billion in capital to help meet a $2.5 billion government requirement to buffer itself against future losses.

The capital will be raised through public offerings of $1 billion common shares and $250 million new mandatory convertible preferred shares. The preferred stock will convert into an unspecified number of common shares on Dec. 15, 2010, unless converted earlier by the shareholder or the bank.

Regions said it will give the underwriters a 30-day option to buy up to an additional 15% of the offerings.

The bank also plans to exchange some of its stock for outstanding trust preferred securities issues by Regions Financing Trust II. The exchange expires on June 17 unless extended or ended earlier.

Regions said it plans to raise the remaining capital required by the Federal Reserve's's Supervisory Capital Assessment Program through various methods, including the possible sale of noncore assets and businesses as well as potential equity exchanges.

Regions Financial, which runs Regions Bank, has $142 billion in assets.

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