An upgrade in earnings estimates for regional banks is on the table from the sell-side analysts at UBS.Earning at Bank of Queensland will lift six per cent in FY 2016 and six per cent in FY 2017/2018."We estimate two basis points of the repricing will be paid out to Owner Managers with 16 bps to shareholders," Jonathan Mott and others at UBS Securities Australia wrote this week.The BOQ ROE "is expected to be 12 per cent in FY 2017."At Bendigo "repricing is partially offset by an assumption that house prices will stagnate in Sydney and Melbourne from [calendar year] 2016. This leads to lower house price mark-to-marked revenue from Homesafe," UBS said."All up, we have increased FY 2016 EPS [for Bendigo] by three per cent and FY 2017/2018 by five per cent."Bendigo's ROE is forecast at 8.4 per cent in FY17."In recent weeks the regional banks have taken the opportunity to reprice their mortgage books following the lead of the majors," UBS opened their commentary."BOQ increased the interest rate on its variable mortgage book by 18 bps, while BEN increased the rate on its variable owner occupied book by 12 bps and its investment property book by 15 bps."UBS asked: "Is regional bank mortgage repricing justified?"They said: "The repricing of mortgage books by the major banks has been attributed to the requirement for them to raise equity following APRA's increase in A-IRB mortgage risk weights (to an average of 25 per cent, as an interim measure). "The regional banks however, have not seen mortgage risk weights increase as they are still on standardised models."Therefore, is it justifiable for regional banks to increase prices? We think it is. "Regional banks have been at a competitive disadvantage since Basel II was introduced, being forced to hold more than twice the capital of major banks against similar mortgage exposures. "This has prevented the regionals from generating an ROE above their cost of capital. "Therefore, we believe it is justifiable for the regional banks to also increase prices to generate economic profit, especially as they are still required to hold more capital against their mortgage books than the majors."