Should we all take heart when federal regulators say a bank is well capitalized? Jonathan Weil, a number-crunching Bloomberg journalist who once labored at the Democrat-Gazette, raises the question with a report on a bank familiar here, Regions:

Check out the footnotes to Regions Financial Corp.’s latest quarterly report, and you’ll see a remarkable disclosure. There, in an easy-to-read chart, the company divulged that the loans on its books as of June 30 were worth $22.8 billion less than what its balance sheet said. The Birmingham, Alabama-based bank’s shareholder equity, by comparison, was just $18.7 billion.

So, if it weren’t for the inflated loan values, Regions’ equity would be less than zero. Meanwhile, the government continues to classify Regions as “well capitalized.”

Weil goes on to write that Regions is by no means alone.