NEW YORK ( TheStreet) -- Regions Financial ( RF) was the winner among the largest U.S. financial names on Wednesday, with shares rising over 3% to close at $6.65. The broad indexes were strong after the Federal Reserve increased its projection for 2012 gross domestic product growth to a range of 2.4% to 2.9%, from a previous projected range of 2.2% to 2.7% in January. The central bank's 2013 GDP growth projection now ranges from 2.7% to 3.1%, narrowing from January's range of 2.8% to 3.2%.
The KBW Bank Index ( I:BKX) rose over 1% to close at $48.33. Regions Financial on Tuesday reported first-quarter earnings from continuing operations available to common shareholders of $185 million, or 14 cents a share, improving from losses of $135 million, or 11 cents a share, in the fourth quarter, and a loss of $2 million, or less than a penny a share, in the first quarter of 2011. The first-quarter results reflected a provision for loan losses of $117 million, declining from $295 million the previous quarter, and $482 million a year earlier. A $215 million release of loan loss reserves directly boosted first-quarter operating results. The first quarter was a transitional one for Regions, which sold its Morgan Keegan brokerage unit and also raised $900 million in common equity, in preparation for the company's the full repayment in early April of $3.5 billion in federal bailout funds received through the Troubled Assets Relief Program, or TARP, in November 2008. Regions said it was in a "strong capital position," with an estimated Tier 1 common equity ratio of 9.6% as of March 31, increasing to an estimated 10.6% following the TARP repayment. KBW analyst Jefferson Harralson rates Regions "Market Perform," with a $7 price target, saying on Wednesday that "now, after four years of being on the defensive, RF can once again resume its normal business plans. As such, the balance sheet should stop shrinking and the 13 quarter streak of loan shrinkage can end too." Regions Financial's shares have returned 55% year-to-date, following a 38% decline during 2011.
The shares trade for just above their reported March 31 tangible book value of $6.42, and for nine times the consensus 2013 EPS estimate of 77 cents. The consensus 2012 EPS estimate is 55 cents. Interested in more on Regions Financial? See TheStreet Ratings' report card for this stock.