Regions downgraded on challenged operating leverage at Truist

Truist downgraded Regions Financial to Hold from Buy with a price target of $20, down from $21. The analyst reduced estimates to reflect lower fee income, higher expenses and provisioning. Regions has more downside interest rate protection, but its revenue growth is likely to be constrained through 2024, the analyst tells investors in a research note. With fewer levers to lower expenses, the bank’s operating leverage will likely be challenged, lowering its earnings growth potential over the next few years, says the firm. Additionally, Regions will likely be affected by increased capital requirements for larger banks, writes Truist.