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Rating Action:

Moody's Downgrades Regions to Ba3, Continues Review for Further Downgrade

16 Nov 2010

New York, November 16, 2010 -- Moody's Investors Service downgraded the ratings of Regions Financial Corporation (senior to Ba3 from Ba1) and its subsidiaries, including its lead bank, Regions Bank (long-term deposits to Ba1 from Baa3, short-term to Not-Prime from Prime-3), and left all long-term ratings under review for further possible downgrade.

RATINGS RATIONALE

The downgrade and review follows Regions' announcement of senior leadership changes in its risk management organization. On November 15, 2010, Regions announced the resignation of its Chief Risk Officer, the retirement of the Director of Credit Risk, and that the head of Problem Asset Management had left the company.

Regions has continued to face significant asset quality issues given its credit concentrations as demonstrated by substantial inflows of non-performing assets in 3Q10. This, coupled with the significant leadership changes in the company's risk management organization, raises serious concerns regarding the firm's controls and the path of future asset quality charges. This was a key concern that led to today's rating action.

Additionally, given these developments, Moody's said that during its review it will consider if its more severe stress scenario better reflects the probable path of Regions asset quality and the implications that this would have on Regions' capital base over the next several quarters.

These actions had no impact on the FDIC-guaranteed debt issued by Regions Bank, which remains at Aaa with a stable outlook.

Moody's last rating action on Regions was on November 1, 2010, when the holding company's senior rating was lowered to Ba1 from Baa3 and the bank's long-term deposits were lowered to Baa3 from Baa1 as a result of the removal of systemic support assumptions from the company's ratings.

The principal methodologies used in this rating were Bank Financial Strength Ratings: Global Methodology published in February 2007, Incorporation of Joint-Default Analysis into Moody's Bank Ratings: A Refined Methodology published in March 2007 and Moody's Guidelines for Rating Bank Hybrid Securities and Subordinated Debt Published in November 2009.

Regions Financial Corporation headquartered in Birmingham, Alabama, reported total assets of $134 billion at September 30, 2010.

Issuer: AmSouth Bancorporation

..Downgrades:

....Subordinate Regular Bond/Debenture, Downgraded to B1 from Ba2

..Outlook Actions:

....Outlook, Changed To Rating Under Review From Negative

Issuer: AmSouth Bank

..Downgrades:

....Subordinate Regular Bond/Debenture, Downgraded to Ba3 from Ba1

..Outlook Actions:

....Outlook, Changed To Rating Under Review From Negative

Issuer: Regions Asset Management Company, Inc.

..Downgrades:

....Preferred Stock Preferred Stock, Downgraded to B1 from Ba2

..Outlook Actions:

....Outlook, Changed To Rating Under Review From Negative

Issuer: Regions Bank

..Downgrades:

.... Issuer Rating, Downgraded to Ba2 from Baa3

.... OSO Rating, Downgraded to NP from P-3

.... Deposit Rating, Downgraded to NP from P-3

....OSO Senior Unsecured OSO Rating, Downgraded to Ba2 from Baa3

....Multiple Seniority Bank Note Program, Downgraded to a range of (P) Ba3 to (P) NP from a range of (P) Ba1 to (P) P-3

....Subordinate Regular Bond/Debenture, Downgraded to Ba3 from Ba1

....Senior Unsecured Deposit Rating, Downgraded to Ba1 from Baa3

..Outlook Actions:

....Outlook, Changed To Rating Under Review From Negative

Issuer: Regions Financial Corporation

..Downgrades:

.... Issuer Rating, Downgraded to Ba3 from Ba1

....Multiple Seniority Shelf, Downgraded to a range of (P)B3 to (P)Ba3 from a range of (P)B1 to (P)Ba1

....Subordinate Regular Bond/Debenture, Downgraded to B1 from Ba2

....Subordinate Shelf, Downgraded to (P)B1 from (P)Ba2

....Senior Unsecured Regular Bond/Debenture, Downgraded to Ba3 from Ba1

..Outlook Actions:

....Outlook, Changed To Rating Under Review From Negative

Issuer: Regions Financing Trust II

..Downgrades:

....Preferred Stock Preferred Stock, Downgraded to B2 from Ba3

....Preferred Stock Shelf, Downgraded to (P)B2 from (P)Ba3

..Outlook Actions:

....Outlook, Changed To Rating Under Review From Negative

Issuer: Regions Financing Trust III

..Downgrades:

....Preferred Stock Preferred Stock, Downgraded to B2 from Ba3

..Outlook Actions:

....Outlook, Changed To Rating Under Review From Negative

Issuer: Union Planters Bank, National Association

..Downgrades:

....Subordinate Regular Bond/Debenture, Downgraded to Ba3 from Ba1

..Outlook Actions:

....Outlook, Changed To Rating Under Review From Negative

Issuer: Union Planters Corporation

..Downgrades:

....Subordinate Regular Bond/Debenture, Downgraded to B1 from Ba2

....Senior Unsecured Regular Bond/Debenture, Downgraded to Ba3 from Ba1

..Outlook Actions:

....Outlook, Changed To Rating Under Review From Negative

Issuer: Union Planters Preferred Funding Corp.

..Downgrades:

....Preferred Stock Preferred Stock, Downgraded to B2 from Ba3

..Outlook Actions:

....Outlook, Changed To Rating Under Review From Negative

REGULATORY DISCLOSURES

Information sources used to prepare the credit rating are the following: parties involved in the ratings, public information and confidential and proprietary Moody's Investors Service information.

Moody's Investors Service considers the quality of information available on the issuer or obligation satisfactory for the purposes of maintaining a credit rating.

Moody's adopts all necessary measures so that the information it uses in assigning a credit rating is of sufficient quality and from sources Moody's considers to be reliable including, when appropriate, independent third-party sources. However, Moody's is not an auditor and cannot in every instance independently verify or validate information received in the rating process.

Please see ratings tab on the issuer/entity page on Moodys.com for the last rating action and the rating history.

The date on which some Credit Ratings were first released goes back to a time before Moody's Investors Service's Credit Ratings were fully digitized and accurate data may not be available. Consequently, Moody's Investors Service provides a date that it believes is the most reliable and accurate based on the information that is available to it. Please see the ratings disclosure page on our website www.moodys.com for further information.

Please see the Credit Policy page on Moodys.com for the methodologies used in determining ratings, further information on the meaning of each rating category and the definition of default and recovery.

New York
Gregory Frank
Vice President - Senior Analyst
Financial Institutions Group
Moody's Investors Service
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653

New York
Robert Young
MD - Financial Institutions
Financial Institutions Group
Moody's Investors Service
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653

Moody's Investors Service
250 Greenwich Street
New York, NY 10007
U.S.A.

Moody's Downgrades Regions to Ba3, Continues Review for Further Downgrade
No Related Data.
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