Report: Regions investigating its executives

Regions Bank officials are investigating whether executives delayed making public disclosure about loans that were going bad, according to The Wall Street Journal. The issue concerns when problematic loans were designated as “nonaccrual,” meaning that interest payments were overdue and collection of the principal was unlikely. Once nonaccruals go up, banks have to put more money in cash reserves to cover loan losses, which causes profits to wane. The SEC has leveled civil charges against Regions, saying its investment-bank unit defrauded investors in subprime securities. Regions has called the charges “misdirected and factually inaccurate,” but the Journal says the bank is close to a nearly $200 million settlement in the case. Regions was hurt by its commercial and residential mortgage holdings in Florida and Georgia during the recession. Read the full story here.