BancorpSouth Announces First Quarter 2021 Results

TUPELO, Miss., April 21, 2021 /PRNewswire/ -- BancorpSouth Bank (NYSE: BXS) (the "Company") today announced financial results for the quarter ended March 31, 2021.

Highlights for the first quarter of 2021 included:

  • Achieved record quarterly net income available to common shareholders of $79.2 million, or $0.77 per diluted common share, and record net operating income available to common shareholders – excluding MSR – of $74.8 million, or $0.73 per diluted common share.
  • Generated $99.1 million in pre-tax pre-provision net revenue (PPNR), or 1.64 percent of average assets on an annualized basis.
  • Credit quality indicators improved as evidenced by no recorded provision for credit losses for the quarter and a decline of $21.9 million, or 16.5 percent, in total non-performing assets.
  • Generated total deposit and customer repo growth of $1.3 billion for the quarter, or 26.7 percent on an annualized basis.
  • Originated and funded 7,527 loans totaling $463.5 million under the Paycheck Protection Program (PPP); received PPP forgiveness payments totaling $307.9 million during the quarter.
  • Continued strong mortgage production volume of $789.8 million which contributed to mortgage production and servicing revenue of $17.9 million.
  • Maintained strong regulatory capital metrics; estimated total risk-based capital of 14.65 percent at March 31, 2021 compared to 14.48 percent at December 31, 2020.
  • Recently received regulatory approval to complete transactions with National United Bancshares, Inc., the parent company of National United, and FNS Bancshares, Inc., the parent company of FNB Bank, which are expected to close effective May 1, 2021 and add approximately $1.6 billion in total assets to the Company.
  • On April 12, 2021, announced the signing of a merger agreement with Cadence Bancorporation, the parent company of Cadence Bank N.A., which creates a $44 billion institution on a pro forma basis that will be the 5th largest bank headquartered in the Company's nine-state footprint.

"We are pleased to report another quarter of record financial performance," remarked Dan Rollins, Chairman and Chief Executive Officer.  "While the unprecedented liquidity levels in the industry continue to pressure our net interest margin and adversely impact loan demand, our teammates are doing a great job taking care of customers and controlling the things we can control.  Consistent with industry trends, we reported meaningful deposit and customer repo growth for the quarter. Our mortgage team had another outstanding quarter, while our insurance and wealth management teams reported strong revenue growth for the quarter.  We also originated almost $465 million in new PPP loans during the quarter while also receiving forgiveness payments totaling over $300 million on loans that were originated last year."

"As we look at other highlights for the quarter, we are extremely pleased with credit quality.  The economies across our footprint are open and generally performing quite well.  Virtually all of our credit quality indicators, including non-performing and classified assets, improved which, along with the economic forecasts utilized in our modeling process, resulted in no recorded provision for credit losses for the quarter.  Finally, we continue to be pleased with our efforts to improve our expense base as reflected in the meaningful decline in total non-interest expense compared to both the first and fourth quarters of last year."

Earnings Summary

The Company reported net income available to common shareholders of $79.2 million, or $0.77 per diluted common share, for the first quarter of 2021, compared with net income available to common shareholders of $21.9 million, or $0.21 per diluted common share, for the first quarter of 2020 and net income available to common shareholders of $66.4 million, or $0.65 per diluted common share, for the fourth quarter of 2020.  The Company reported net operating income available to common shareholders – excluding MSR – of $74.8 million, or $0.73 per diluted common share, for the first quarter of 2021, compared with $34.4 million, or $0.33 per diluted common share, for the first quarter of 2020 and $70.8 million, or $0.69 per diluted common share, for the fourth quarter of 2020.

The Company reported PPNR of $99.1 million, or 1.64 percent of average assets on an annualized basis, for the first quarter of 2021 compared to $91.7 million, or 1.74 percent of average assets on an annualized basis, for the first quarter of 2020 and $93.6 million, or 1.57 percent of average assets on an annualized basis, for the fourth quarter of 2020.

Net Interest Revenue

Net interest revenue was $172.8 million for the first quarter of 2021, an increase of 3.1 percent from $167.5 million for the first quarter of 2020 and a decrease of 2.3 percent from $176.9 million for the fourth quarter of 2020.  The fully taxable equivalent net interest margin was 3.15 percent for the first quarter of 2021, compared with 3.54 percent for the first quarter of 2020 and 3.29 percent for the fourth quarter of 2020.  Yields on net loans and leases were 4.53 percent for the first quarter of 2021, compared with 5.00 percent for the first quarter of 2020 and 4.55 percent for the fourth quarter of 2020, while yields on total interest earning assets were 3.51 percent for the first quarter of 2021, compared with 4.27 percent for the first quarter of 2020 and 3.70 percent for the fourth quarter of 2020.  The net interest margin, excluding accretable yield, was 3.08 percent for the first quarter of 2021, compared with 3.48 percent for the first quarter of 2020 and 3.24 percent for the fourth quarter of 2020, while yields on net loans and leases, excluding accretable yield, were 4.43 percent for the first quarter of 2021, compared with 4.93 percent for the first quarter of 2020 and 4.49 percent for the fourth quarter of 2020. 

The $1.1 billion in PPP loans on the balance sheet had an adverse impact of approximately six basis points on the yield on net loans and leases, excluding accretable yield, for the first quarter of 2021.  Net interest income for the first quarter of 2021 included approximately $3.1 million of accelerated PPP fee income recognition resulting from the payoff of loans that were forgiven by the SBA during the quarter.  The average cost of deposits was 0.33 percent for the first quarter of 2021, compared with 0.67 percent for the first quarter of 2020 and 0.38 percent for the fourth quarter of 2020.

Balance Sheet Activity

Loans and leases, net of unearned income, increased $16.3 million during the first quarter of 2021.  Excluding the impact of PPP originations and paydowns, total loans declined approximately $140.0 million compared to December 31, 2020.  Deposits and customer repos increased $1.3 billion, or 26.7 percent on an annualized basis, during the first quarter of 2021.  There were no acquisitions during the first quarter of 2021. 

Provision for Credit Losses and Allowance for Credit Losses

Earnings for the first quarter of 2021 reflect no provision for credit losses, compared with a provision of $46.0 million for the first quarter of 2020 and a provision of $5.0 million for the fourth quarter of 2020.  Net charge-offs for the first quarter of 2021 were $3.3 million, or 0.09 percent of net loans and leases on an annualized basis, compared with net charge-offs of $13.7 million for the first quarter of 2020 and net charge-offs of $11.2 million for the fourth quarter of 2020.  The allowance for credit losses was $241.1 million, or 1.60 percent of net loans and leases, at March 31, 2021, compared with $218.2 million, or 1.53 percent of net loans and leases, at March 31, 2020, and $244.4 million, or 1.63 percent of net loans and leases, at December 31, 2020.   The allowance for credit losses coverage, excluding the impact of PPP loans, was 1.74 percent of net loans and leases at March 31, 2021.   

Total non-performing assets were $110.7 million, or 0.43 percent of total assets, at March 31, 2021, compared with $137.8 million, or 0.66 percent of total assets, at March 31, 2020, and $132.6 million, or 0.55 percent of total assets, at December 31, 2020.  Other real estate owned was $9.4 million at March 31, 2021, compared with $9.2 million at March 31, 2020 and $11.4 million at December 31, 2020.

Noninterest Revenue

Noninterest revenue was $87.9 million for the first quarter of 2021, compared with $76.5 million for the first quarter of 2020 and $78.8 million for the fourth quarter of 2020.  These results include a positive mortgage servicing rights (MSR) valuation adjustment of $7.4 million for the first quarter of 2021, compared with a negative MSR valuation adjustment of $11.1 million for the first quarter of 2020 and a positive MSR valuation adjustment of $0.2 million for the fourth quarter of 2020.  Valuation adjustments in the MSR asset are driven primarily by fluctuations in interest rates period over period.   

Mortgage production and servicing revenue was $17.9 million for the first quarter of 2021, compared with $20.6 million for the first quarter of 2020 and $19.9 million for the fourth quarter of 2020.  Mortgage origination volume for the first quarter of 2021 was $789.8 million, compared with $477.1 million for the first quarter of 2020 and $845.9 million for the fourth quarter of 2020.  Home purchase money volume was $379.4 million for the first quarter of 2021, compared with $285.3 million for the first quarter of 2020 and $466.4 million for the fourth quarter of 2020.  Of the total mortgage origination volume for the first quarter of 2021, $149.0 million was portfolio loans, compared with $85.6 million for the first quarter of 2020 and $157.8 million for the fourth quarter of 2020.

Credit card, debit card, and merchant fee revenue was $9.7 million for the first quarter of 2021, compared with $9.2 million for the first quarter of 2020 and $10.1 million for the fourth quarter of 2020.  Deposit service charge revenue was $8.5 million for the first quarter of 2021, compared with $11.7 million for the first quarter of 2020 and $9.7 million for the fourth quarter of 2020.  Wealth management revenue was $8.5 million for the first quarter of 2021, compared with $6.6 million for the first quarter of 2020 and $6.8 million for the fourth quarter of 2020.  Insurance commission revenue was $30.7 million for the first quarter of 2021, compared with $29.6 million for the first quarter of 2020 and $29.8 million for the fourth quarter of 2020.  Other noninterest revenue was $5.3 million for the first quarter of 2021, compared with $10.1 million for the first quarter of 2020 and $2.3 million for the fourth quarter of 2020.  Other noninterest revenue for the fourth quarter of 2020 was adversely impacted by $2.7 million of book amortization associated with a historic tax credit.  A related benefit of $3.0 million was recorded as a reduction to income tax expense for the fourth quarter of 2020.  Other noninterest revenue for the first quarter of 2020 included a $4.2 million gain associated with the sale of a book of business within the Company's insurance agency.

Noninterest Expense

Noninterest expense for the first quarter of 2021 was $155.8 million, compared with $168.0 million for the first quarter of 2020 and $167.9 million for the fourth quarter of 2020.  Salaries and employee benefits expense was $101.1 million for the first quarter of 2021, compared with $108.3 million for the first quarter of 2020 and $97.2 million for the fourth quarter of 2020.  Occupancy expense was $12.8 million for the first quarter of 2021, compared with $12.7 million for the first quarter of 2020 and $13.0 million for the fourth quarter of 2020.  Other noninterest expense was $35.9 million for the first quarter of 2021, compared with $40.8 million for the first quarter of 2020 and $45.4 million for the fourth quarter of 2020.  Additionally, merger-related expense for the first quarter of 2021 was $1.6 million, compared with merger-related expense of $4.5 million for the first quarter of 2020 and $0.2 million for the fourth quarter of 2020. 

Noninterest expense for the first quarter of 2021 and the fourth quarter of 2020 included certain items that were non-routine in nature as defined by the Company.  Salaries and benefits expense for the first quarter of 2021 benefited from an accrual true-up totaling approximately $3.0 million related to the Company's equity compensation plans.  During the fourth quarter of 2020, the Company recorded a charge of $5.8 million in accordance with ASC 715 "Compensation – Retirement Benefits" to reflect the settlement accounting impact of an elevated number of retirements and related lump sum pension payouts during the quarter.   Salaries and employee benefits expense was positively impacted by accrual true ups totaling approximately $6.7 million relating to incentive compensation and other employee benefits.  Other non-interest expense included charges and write-downs totaling approximately $5.0 million associated with the anticipated disposition of certain facilities and other fixed assets, including fixed assets associated with branches identified for closure. 

Capital Management

The Company's ratio of shareholders' equity to assets was 10.95 percent at March 31, 2021, compared with 12.75 percent at March 31, 2020 and 11.72 percent at December 31, 2020.  The ratio of tangible common shareholders' equity to tangible assets was 7.04 percent at March 31, 2021, compared with 7.99 percent at March 31, 2020 and 7.54 percent at December 31, 2020.  The $1.1 billion in PPP loans had an adverse impact of approximately 34 basis points on tangible common shareholders' equity to tangible assets at March 31, 2021.

During the first quarter of 2021, the Company did not repurchase any shares of its common stock pursuant to its share repurchase program.  The Company has 6.0 million shares remaining on its current share repurchase authorization which will expire on December 31, 2021.  

Estimated regulatory capital ratios at March 31, 2021 were calculated in accordance with the Basel III capital framework as well as the interagency final rule published on September 30, 2020 entitled "Revised Transition of the Current Expected Credit Losses Methodology for Allowances".  The Company is a "well capitalized" bank, as defined by federal regulations, at March 31, 2021, with Tier 1 risk-based capital of 11.95 percent and total risk-based capital of 14.65 percent, compared with required minimum levels of 8 percent and 10 percent, respectively, in order to qualify for "well capitalized" classification. 

Summary

Rollins concluded, "It's an exciting time for our Company.  The economies in our markets are performing quite well and, despite certain industry headwinds, we continue to be pleased with our financial performance.   We look forward to the growth opportunities ahead of us.  The recent merger announcement with Cadence is a transformational opportunity for our Company.  We believe the strengths of each organization are complementary.  Both organizations are highly focused on improving the customer experience and giving back to the communities we serve.  We are also excited about the opportunity to complete our pending mergers with National United and FNB Bank next month.  These two teams will be an integral part of our strategic efforts going forward as we continue to grow our Company and enhance shareholder value."

TRANSACTIONS

Cadence Bancorporation (NYSE: CADE)

On April 12, 2021, the Company announced the signing of a definitive merger agreement (the Cadence Merger Agreement) with Cadence Bancorporation, the parent company of Cadence Bank N.A., (collectively referred to as Cadence), pursuant to which Cadence will be merged with and into the Company (the Cadence Merger).  Cadence operates 98 full-service banking offices in the southeast.  As of December 31, 2020, Cadence collectively reported total assets of $18.7 billion, total loans of $12.7 billion and total deposits of $16.1 billion.  Under the terms of the Cadence Merger Agreement, each Cadence shareholder will receive 0.70 shares of the Company's common stock.  In addition, Cadence will pay a one-time special dividend of $1.25 per share at closing.  For more information regarding the Cadence Merger, see our Current Report on Form 8-K that was filed with the Federal Deposit Insurance Corporation (FDIC) on April 12, 2021.  The Cadence Merger Agreement has been unanimously approved by the Boards of Directors of the Company and Cadence.  Subject to the satisfaction of all closing conditions, including the receipt of all required regulatory and shareholder approvals, the Cadence Merger is expected to be completed during the fourth quarter of 2021, although the Company can provide no assurance that the Cadence Merger will close during this time period or at all.

FNS Bancshares, Inc.

On January 13, 2021, the Company announced the signing of a definitive merger agreement (the FNS Merger Agreement) with FNS Bancshares, Inc., the parent company of FNB Bank, (collectively referred to as FNS), pursuant to which FNS will be merged with and into the Company (the FNS Merger).  FNS operates 17 full-service banking offices in Alabama, Georgia and Tennessee.  The merger will expand the Company's presence in Jackson, DeKalb and Marshall counties in Alabama and the Chattanooga, Tennessee-Georgia and Nashville-Davidson-Murfreesboro-Franklin, Tennessee metropolitan statistical areas.  As of March 31, 2021, FNS collectively reported total assets of $826.5 million, total loans of $475.1 million and total deposits of $709.9 million.  Under the terms of the FNS Merger Agreement, the Company will issue approximately 2,975,000 shares of the Company's common stock plus $18.0 million in cash for all outstanding shares of FNS.  For more information regarding the FNS Merger, see our Current Report on Form 8-K that was filed with the FDIC on January 13, 2021.  Subject to the satisfaction of all closing conditions, the FNS Merger is expected to close on May 1, 2021.

National United Bancshares, Inc.

On December 2, 2020, the Company announced the signing of a definitive merger agreement (the National United Merger Agreement) with National United Bancshares, Inc., the parent company of National United, (collectively referred to as National United), pursuant to which National United will be merged with and into the Company (the National United Merger).  National United operates 6 full-service banking offices in the Killeen-Temple, Texas; Waco, Texas; and Austin-Round Rock-Georgetown, Texas metropolitan statistical areas.  As of March 31, 2021, National United collectively reported total assets of $788.9 million, total loans of $440.6 million and total deposits of $712.8 million.  Under the terms of the National United Merger Agreement, the Company will issue approximately 3,110,000 shares of the Company's common stock plus $33.25 million in cash for all outstanding shares of National United.  For more information regarding National United Merger, see our Current Report on Form 8-K that was filed with the FDIC on December 2, 2020.  Subject to the satisfaction of all closing conditions, the National United Merger is expected to close on May 1, 2021.

Non-GAAP Measures and Ratios

This news release presents certain financial measures and ratios that are not calculated in accordance with U.S. generally accepted accounting principles (GAAP).  A discussion regarding these non-GAAP measures and ratios, including reconciliations of non-GAAP measures to the most directly comparable GAAP measures and definitions for non-GAAP ratios, appears under the caption "Reconciliation of Non-GAAP Measures and Other Non-GAAP Ratio Definitions"  beginning on page 24 of this news release.

Statement Regarding Impact of COVID-19 Pandemic

The Company prioritizes the health and safety of its teammates and customers, and it will continue to do so throughout the duration of the COVID-19 pandemic.  At the same time, the Company remains focused on improving shareholder value, managing credit exposure, challenging expenses, enhancing the customer experience and supporting the communities it serves. Lastly, as a SBA Preferred Lender, the Company is an active participant in the SBA's PPP for the betterment of its customers and the communities that it serves.

In the presentation that accompanies this news release and in its earnings conference call, the Company has sought and will seek to describe the historical and future impact of the COVID-19 pandemic on the Company's assets, business, cash flows, financial condition, liquidity, prospects and results of operations, including the information and discussions regarding negative pressure on its net interest margin and loan demand.  Although the Company believes that the statements that pertain to future events, results and trends and their impact on the Company's business are reasonable at the present time, those statements are not historical facts and are based upon current assumptions, expectations, estimates and projections, many of which, by their nature, are beyond the Company's control.  Accordingly, all discussions regarding future events, results and trends and their impact on the Company's business, even in the near term, are necessarily uncertain given the fluid and evolving nature of the pandemic.

If the health, logistical or economic effects of the pandemic worsen, or if the assumptions, expectations, estimates or projections that underlie the Company's statements regarding future effects or trends prove to be incorrect, then the Company's actual assets, business, cash flows, financial condition, liquidity, prospects and results of operations and the trading prices of its capital stock may be materially and adversely impacted in ways that the Company cannot reasonably forecast.

Accordingly, when reading this news release and the accompanying presentation and when listening to the earnings conference call, undue reliance should not be placed upon any statement pertaining to future events, results and trends and their impact on the Company's business in future periods.

Conference Call and Webcast

The Company will conduct a conference call to discuss its first quarter 2021 financial results on April 22, 2021, at 10:00 a.m. (Central Time).  This conference call will be an interactive session between management and analysts. Interested parties may listen to this live conference call via Internet webcast by accessing www.bancorpsouth.investorroom.com/webcasts. The webcast will also be available in archived format at the same address.

About BancorpSouth Bank

BancorpSouth Bank (NYSE: BXS) is headquartered in Tupelo, Mississippi, with approximately $26 billion in assets.  BancorpSouth operates approximately 300 full service branch locations as well as additional mortgage, insurance, and loan production offices in Alabama, Arkansas, Florida, Louisiana, Mississippi, Missouri, Tennessee and Texas, including an insurance location in Illinois.  BancorpSouth is committed to a culture of respect, diversity, and inclusion in both its workplace and communities. To learn more, visit our Community Commitment page at www.bancorpsouth.com.  Like us on Facebook; follow us on Twitter and Instagram: @MyBXS; or connect with us through LinkedIn.

Forward-Looking Statements

Certain statements made in this news release are not statements of historical fact and constitute "forward-looking statements" within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and are subject to the safe harbor created thereby under the Private Securities Litigation Reform Act of 1995. These statements are often, but not always, made through the use of words or phrases such as "anticipate," "aspire," "assume," "believe," "budget," "contemplate," "continue," "could," "estimate," "expect," "forecast," "foresee," "goal," "hope," "indicate," "intend," "may," "might," "outlook," "plan," "project," "projection," "predict," "prospect," "potential," "roadmap," "seek," "should," "target," "will," and "would," or the negative versions of those words or other comparable words of a future or forward-looking nature. These forward-looking statements include, without limitation, discussions regarding general economic, interest rate, real estate market, competitive, employment, and credit market conditions, including the impact of the COVID-19 pandemic on the Company's business; the Company's: assets; business; cash flows; financial condition; liquidity; prospects; results of operations; deposit and customer repo growth; interest and fee-based revenue; capital resources; capital metrics; efficiency ratio; valuation of mortgage servicing rights; net income; net interest revenue; non-interest revenue; net interest margin; interest expense; non-interest expense; earnings per share; interest rate sensitivity; interest rate risk; balance sheet and liquidity management; off-balance sheet arrangements; fair value determinations; asset quality; credit quality; credit losses; provision and allowance for credit losses, impairments, charge-offs, recoveries and changes in loan volumes; investment securities portfolio yields and values; ability to manage the impact of pandemics, natural disasters and other force majeure events; adoption and use of critical accounting policies; adoption and implementation of new accounting standards and their effect on the Company's financial results and the Company's financial reporting; utilization of non-GAAP financial metrics; declaration and payment of dividends; ability to pay dividends or coupons on the Company's 5.5% Series A Non-Cumulative Perpetual Preferred Stock, par value $0.01 per share, or the 4.125% Fixed-to-Floating Rate Subordinated Notes due November 20, 2029; mortgage origination volume; mortgage servicing and production revenue; insurance commission revenue; implementation and execution of cost savings initiatives; ability to successfully litigate, resolve or otherwise dispense with threatened, pending, ongoing and future litigation and governmental, administrative and investigatory matters; ability to successfully complete pending or future acquisitions, dispositions and other strategic growth opportunities and initiatives; ability to successfully obtain regulatory approval for acquisitions and other growth initiatives; ability to successfully integrate and manage acquisitions; opportunities and efforts to grow market share; reputation; ability to compete with other financial institutions; ability to recruit and retain key employees and personnel; access to capital markets; availability of capital; investments in the securities of other financial institutions; and ability to operate the Company's regulatory compliance programs in accordance with applicable law.

Forward-looking statements are based upon management's expectations as well as certain assumptions and estimates made by, and information available to, the Company's management at the time such statements were made. Forward-looking statements are not historical facts, are not guarantees of future results or performance and are subject to certain known and unknown risks, uncertainties and other factors that are beyond the Company's control and that may cause actual results to differ materially from those expressed in, or implied by, such forward-looking statements. These risks, uncertainties and other factors include, without limitation, potential delays or other problems in implementing and executing the Company's growth, expansion and acquisition strategies, including delays in obtaining regulatory or other necessary approvals or the failure to realize any anticipated benefits or synergies from any acquisitions or growth strategies; the risks of changes in interest rates and their effects on the level and composition of deposits, loan demand and the values of loan collateral, securities and interest sensitive assets and liabilities; the failure of assumptions underlying the establishment of reserves for possible credit losses, fair value for loans and other real estate owned; changes in real estate values; the availability of and access to capital; possible downgrades in the Company's credit ratings or outlook which could increase the costs or availability of funding from capital markets; the ability to attract new or retain existing deposits or to retain or grow loans; the ability to grow additional interest and fee income or to control noninterest expense; the potential impact of the proposed phase-out of the London Interbank Offered Rate ("LIBOR") or other changes involving LIBOR; competitive factors and pricing pressures, including their effect on the Company's net interest margin; general economic, unemployment, credit market and real estate market conditions, and the effect of such conditions on the creditworthiness of borrowers, collateral values, the value of investment securities and asset recovery values; changes in legal, financial and/or regulatory requirements; recently enacted and potential legislation and regulatory actions and the costs and expenses to comply with new and/or existing legislation and regulatory actions, including those actions in response to the COVID-19 pandemic such as the Coronavirus Aid, Relief, and Economic Security Act (the "CARES Act"), the Economic Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act (the "Economic Aid Act") and any related rules and regulations; changes in U.S. Government monetary and fiscal policy; FDIC special assessments or changes to regular assessments; the enforcement efforts of federal and state bank regulators; possible adverse rulings, judgments, settlements and other outcomes of pending, ongoing and future litigation and governmental, administrative and investigatory matters (including litigation or actions arising from the Company's participation in and administration of programs related to the COVID-19 pandemic (including, among other things, the PPP loan programs authorized by the CARES Act and the Economic Aid Act); the ability to keep pace with technological changes, including changes regarding maintaining cybersecurity; the impact of failure in, or breach of, the Company's operational or security systems or infrastructure, or those of third parties with whom the Company does business, including as a result of cyber-attacks or an increase in the incidence or severity of fraud, illegal payments, security breaches or other illegal acts impacting the Company or the Company's customers; natural disasters or acts of war or terrorism; the adverse effects of the ongoing global COVID-19 pandemic, including the magnitude and duration of the pandemic, and the effect of actions taken to mitigate the impact of the COVID-19 pandemic on the Company, the Company's employees, the Company's customers, the global economy and the financial markets; international or political instability; impairment of the Company's goodwill or other intangible assets; losses of key employees and personnel; adoption of new accounting standards, including the effects from the adoption of the current expected credit loss methodology on January 1, 2020, or changes in existing standards; the occurrence of any event, change or other circumstances that could give rise to the right of one or both of the parties to terminate the definitive merger agreement between the Company and Cadence; the outcome of any legal proceedings that may be instituted against the Company or Cadence; the possibility that the proposed transaction will not close when expected or at all because required regulatory, shareholder or other approvals are not received or other conditions to the closing are not satisfied on a timely basis or at all, or are obtained subject to conditions that are not anticipated; the ability of the Company and Cadence to meet expectations regarding the timing, completion and accounting and tax treatments of the proposed transaction; the risk that any announcements relating to the proposed transaction could have adverse effects on the market price of the common stock of either or both parties to the proposed transaction; the possibility that the anticipated benefits of the proposed transaction will not be realized when expected or at all, including as a result of the impact of, or problems arising from, the integration of the two companies or as a result of the strength of the economy and competitive factors in the areas where the Company and Cadence do business; certain restrictions during the pendency of the proposed transaction that may impact the parties' ability to pursue certain business opportunities or strategic transactions; the possibility that the transaction may be more expensive to complete than anticipated, including as a result of unexpected factors or events; diversion of management's attention from ongoing business operations and opportunities; the possibility that the parties may be unable to achieve expected synergies and operating efficiencies in the merger within the expected timeframes or at all and to successfully integrate Cadence's operations and those of the Company; such integration may be more difficult, time consuming or costly than expected; revenues following the proposed transaction may be lower than expected; potential adverse reactions or changes to business or employee relationships, including those resulting from the announcement or completion of the proposed transaction; the Company and Cadence's success in executing their respective business plans and strategies and managing the risks involved in the foregoing; the dilution caused by the Company's issuance of additional shares of its capital stock in connection with the proposed transaction and other factors as detailed from time to time in the Company's press and news releases, periodic and current reports and other filings the Company files with the FDIC.

The foregoing factors should not be construed as exhaustive and should be read in conjunction with those factors that are set forth from time to time in the Company's periodic and current reports filed with the FDIC, including those factors included in the Company's Annual Report on Form 10-K for the year ended December 31, 2020 under the heading "Item 1A. Risk Factors," in the Company's Quarterly Reports on Form 10-Q and in the Company's Current Reports on Form 8-K.

Although the Company believes that the expectations reflected in these forward-looking statements are reasonable as of the date of this news release, if one or more events related to these or other risks or uncertainties materialize, or if the Company's underlying assumptions prove to be incorrect, actual results may prove to be materially different from the results expressed or implied by the forward-looking statements. Accordingly, undue reliance should not be placed on any forward-looking statements. The forward-looking statements speak only as of the date of this news release, and the Company does not undertake any obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except as required by applicable law. New risks and uncertainties may emerge from time to time, and it is not possible for the Company to predict their occurrence or how they will affect the Company.  All written or oral forward-looking statements attributable to the Company are expressly qualified in their entirety by this section.

 

BancorpSouth Bank

Selected Financial Information

(Dollars in thousands, except per share data)

(Unaudited)

           
           
 

Quarter Ended

Quarter Ended

Quarter Ended

Quarter Ended

Quarter Ended

 

3/31/2021

12/31/2020

9/30/2020

6/30/2020

3/31/2020

Earnings Summary:

         

Interest revenue

$                    192,783

$                    199,287

$                    200,670

$                    197,472

$                    202,064

Interest expense

19,994

22,351

24,739

26,902

34,534

Net interest revenue

172,789

176,936

175,931

170,570

167,530

Provision for credit losses

-

5,000

15,000

20,000

46,000

Net interest revenue, after provision

         

   for credit losses

172,789

171,936

160,931

150,570

121,530

Noninterest revenue

87,936

78,826

89,924

91,258

76,496

Noninterest expense

155,823

167,911

155,505

162,504

168,006

Income before income taxes

104,902

82,851

95,350

79,324

30,020

Income tax expense

23,347

14,046

21,525

18,164

5,759

Net income

$                      81,555

$                      68,805

$                      73,825

$                      61,160

$                      24,261

Less: Preferred dividends

2,372

2,372

2,372

2,372

2,372

Net income available to common shareholders

$                      79,183

$                      66,433

$                      71,453

$                      58,788

$                      21,889

           

Balance Sheet - Period End Balances

         

Total assets

$               25,802,497

$               24,081,194

$               23,555,422

$               23,236,176

$               21,032,524

Total earning assets

23,542,657

21,792,725

21,340,371

21,119,073

18,939,750

Total securities

7,640,268

6,231,006

5,659,785

4,973,171

4,468,340

Loans and leases, net of unearned income

15,038,808

15,022,479

15,327,735

15,427,421

14,224,645

Allowance for credit losses

241,117

244,422

250,624

237,025

218,199

Net book value of acquired loans (included in loans and leases above)

1,023,252

1,160,267

1,320,671

1,510,008

1,661,329

Paycheck protection program (PPP) loans (included in loans and leases above)

1,146,000

975,421

1,212,246

1,192,715

-

Remaining loan mark on acquired loans

10,069

13,886

16,198

19,977

22,286

Total deposits

21,173,186

19,846,441

19,412,979

19,179,486

16,887,916

Total deposits and securities sold under agreement to repurchase

21,833,671

20,484,156

20,024,434

19,849,502

17,426,878

Long-term debt

4,295

4,402

4,508

4,615

4,721

Junior subordinated debt securities

297,425

297,250

297,074

296,898

296,723

Total shareholders' equity

2,825,198

2,822,477

2,782,539

2,732,687

2,681,904

Common shareholders' equity

2,658,205

2,655,484

2,615,546

2,565,694

2,514,911

           

Balance Sheet - Average Balances

         

Total assets

$               24,545,560

$               23,660,503

$               23,318,877

$               22,707,686

$               21,189,637

Total earning assets

22,346,075

21,497,938

21,241,896

20,594,889

19,113,449

Total securities

6,606,027

5,820,425

5,309,982

4,437,614

4,461,298

Loans and leases, net of unearned income

15,029,076

15,219,402

15,369,684

15,114,732

14,226,788

PPP loans (included in loans and leases above)

1,062,423

1,139,959

1,207,097

975,029

-

Total deposits

20,472,080

19,600,863

19,258,930

18,454,472

16,905,229

Total deposits and securities sold under agreement to repurchase

21,123,774

20,272,881

19,940,330

19,098,599

17,446,936

Long-term debt

4,378

4,488

4,592

4,699

4,800

Junior subordinated debt securities

297,318

297,145

296,969

296,793

296,617

Total shareholders' equity

2,813,001

2,774,589

2,729,870

2,738,434

2,658,699

Common shareholders' equity

2,646,008

2,607,596

2,562,877

2,571,441

2,491,678

           

Nonperforming Assets:

         

Non-accrual loans and leases

$                      73,142

$                      96,378

$                    122,108

$                    126,753

$                    110,074

Loans and leases 90+ days past due, still accruing

21,208

14,320

17,641

9,877

7,272

Restructured loans and leases, still accruing

6,971

10,475

11,154

11,575

11,284

Non-performing loans (NPLs)

101,321

121,173

150,903

148,205

128,630

Other real estate owned

9,351

11,395

6,397

7,164

9,200

Non-performing assets (NPAs)

$                    110,672

$                    132,568

$                    157,300

$                    155,369

$                    137,830

           

Financial Ratios and Other Data:

         

Return on average assets

1.35%

1.16%

1.26%

1.08%

0.46%

Operating return on average assets-excluding MSR*

1.28%

1.23%

1.26%

1.12%

0.70%

Return on average shareholders' equity

11.76%

9.87%

10.76%

8.98%

3.67%

Operating return on average shareholders' equity-excluding MSR*

11.13%

10.49%

10.72%

9.29%

5.56%

Return on average common shareholders' equity

12.14%

10.14%

11.09%

9.19%

3.53%

Operating return on average common shareholders' equity-excluding MSR*

11.47%

10.80%

11.05%

9.53%

5.55%

Return on average tangible equity*

17.35%

14.66%

16.08%

13.43%

5.56%

Operating return on average tangible equity-excluding MSR*

16.42%

15.58%

16.03%

13.89%

8.42%

Return on average tangible common equity*

18.46%

15.54%

17.13%

14.20%

5.54%

Operating return on average tangible common equity-excluding MSR*

17.44%

16.56%

17.08%

14.71%

8.71%

Pre-tax pre-provision net revenue to total average assets*

1.64%

1.57%

1.88%

1.81%

1.74%

Noninterest income to average assets

1.45%

1.33%

1.53%

1.62%

1.45%

Noninterest expense to average assets

2.57%

2.82%

2.65%

2.88%

3.19%

Net interest margin-fully taxable equivalent

3.15%

3.29%

3.31%

3.35%

3.54%

Net interest margin-fully taxable equivalent, excluding net accretion

         

  on acquired loans and leases

3.08%

3.24%

3.23%

3.30%

3.48%

Net interest rate spread

2.97%

3.07%

3.06%

3.08%

3.24%

Efficiency ratio (tax equivalent)*

59.64%

65.47%

58.36%

61.89%

68.65%

Operating efficiency ratio-excluding MSR (tax equivalent)*

60.74%

63.18%

58.41%

61.16%

63.89%

Loan/deposit ratio

71.03%

75.69%

78.96%

80.44%

84.23%

Price to earnings multiple (close)

12.07

12.88

9.18

11.15

9.46

Market value to common book value

125.39%

105.98%

75.99%

90.91%

77.21%

Market value to common book value (avg)

119.10%

97.56%

83.75%

84.79%

107.86%

Market value to common tangible book value

190.14%

161.00%

116.01%

140.44%

120.81%

Market value to common tangible book value (avg)

180.60%

148.21%

127.86%

130.99%

168.76%

Employee FTE

4,546

4,596

4,691

4,742

4,737

           

*Denotes non-GAAP financial measure.  Refer to related disclosure and reconciliation on pages 24 and 25.

     
           

Credit Quality Ratios:

         

Net charge-offs(recoveries) to average loans and leases (annualized)

0.09%

0.29%

0.04%

0.03%

0.39%

Provision for credit losses to average loans and leases (annualized)

0.00%

0.13%

0.39%

0.53%

1.30%

Allowance for credit losses to net loans and leases

1.60%

1.63%

1.64%

1.54%

1.53%

Allowance for credit losses to net loans and leases, excluding PPP loans

1.74%

1.74%

1.78%

1.67%

1.53%

Allowance for credit losses to non-performing loans and leases

237.97%

201.71%

166.08%

159.93%

169.63%

Allowance for credit losses to non-performing assets

217.87%

184.37%

159.33%

152.56%

158.31%

Non-performing loans and leases to net loans and leases

0.67%

0.81%

0.98%

0.96%

0.90%

Non-performing loans and leases to net loans and leases, excluding

         

  acquired loans and leases

0.54%

0.62%

0.74%

0.63%

0.64%

Non-performing assets to total assets

0.43%

0.55%

0.67%

0.67%

0.66%

Non-performing assets to total assets, excluding acquired loans and leases

0.34%

0.42%

0.49%

0.43%

0.44%

           
           

Equity Ratios:

         

Total shareholders' equity to total assets

10.95%

11.72%

11.81%

11.76%

12.75%

Total common shareholders' equity to total assets

10.30%

11.03%

11.10%

11.04%

11.96%

Tangible shareholders' equity to tangible assets*

7.71%

8.26%

8.30%

8.18%

8.82%

Tangible shareholders' equity to tangible assets-excluding PPP loans*

8.08%

8.63%

8.77%

8.65%

8.82%

Tangible common shareholders' equity to tangible assets*

7.04%

7.54%

7.56%

7.44%

7.99%

Tangible common shareholders' equity to tangible assets-excluding PPP loans*

7.38%

7.87%

7.99%

7.86%

7.99%

           

Capital Adequacy:

         

Common  Equity Tier 1 capital

10.97%

10.74%

10.64%

10.21%

10.11%

Tier 1 capital

11.95%

11.74%

11.65%

11.22%

11.13%

Total capital

14.65%

14.48%

14.20%

13.79%

13.75%

Tier 1 leverage capital

8.59%

8.67%

8.59%

8.54%

8.90%

   Estimated for current quarter

         
           

Common Share Data:

         

Basic earnings per share

$                          0.77

$                          0.65

$                          0.70

$                          0.57

$                          0.21

Diluted earnings per share

0.77

0.65

0.69

0.57

0.21

Operating earnings per share*

0.78

0.69

0.70

0.57

0.25

Operating earnings per share- excluding MSR*

0.73

0.69

0.69

0.59

0.33

Cash dividends per share

0.190

0.190

0.185

0.185

0.185

Book value per share

25.90

25.89

25.50

25.01

24.50

Tangible book value per share*

17.08

17.04

16.71

16.19

15.66

Market value per share (last)

32.48

27.44

19.38

22.74

18.92

Market value per share (high)

35.59

28.54

24.29

25.93

31.61

Market value per share (low)

26.95

18.77

18.11

17.21

17.24

Market value per share (avg)

30.85

25.26

21.36

21.21

26.43

Dividend payout ratio

24.62%

29.34%

26.56%

32.29%

88.20%

Total shares outstanding

102,624,818

102,561,480

102,558,459

102,566,301

102,632,484

Average shares outstanding - basic

102,622,111

102,569,547

102,564,466

102,603,525

104,354,328

Average shares outstanding - diluted

102,711,584

102,817,409

102,839,749

102,827,225

104,733,897

           
           

Yield/Rate:

         

(Taxable equivalent basis)

         

Loans, loans held for sale, and leases net of unearned income

4.53%

4.55%

4.54%

4.59%

5.00%

Loans, loans held for sale, and leases net of unearned income, excluding

         

  net accretion on acquired loans and leases

4.43%

4.49%

4.44%

4.53%

4.93%

Loans, loans held for sale, and leases net of unearned income, excluding

         

  net accretion on acquired loans and leases - excluding PPP loans

4.49%

4.53%

4.55%

4.67%

4.93%

PPP loans

3.69%

3.99%

3.11%

2.50%

N/A

Available-for-sale securities:

         

  Taxable

1.32%

1.53%

1.64%

1.95%

1.99%

  Tax-exempt

3.52%

3.40%

3.67%

3.86%

4.44%

Short-term, FHLB and other equity investments

0.11%

0.13%

0.19%

0.20%

1.53%

  Total interest earning assets and revenue

3.51%

3.70%

3.77%

3.87%

4.27%

Deposits

0.33%

0.38%

0.44%

0.50%

0.67%

  Demand - interest bearing

0.40%

0.47%

0.53%

0.61%

0.84%

  Savings

0.11%

0.15%

0.18%

0.18%

0.26%

  Other time

1.14%

1.28%

1.41%

1.54%

1.64%

  Total interest bearing deposits

0.48%

0.57%

0.65%

0.74%

0.92%

Short-term borrowings

0.13%

0.26%

0.25%

0.39%

1.25%

Total interest bearing deposits and short-term borrowings

0.46%

0.55%

0.63%

0.71%

0.95%

Junior subordinated debt

4.46%

4.05%

4.24%

4.18%

4.42%

Long-term debt

4.88%

4.84%

4.85%

4.81%

4.96%

  Total interest bearing liabilities and expense

0.54%

0.63%

0.71%

0.79%

1.03%

Interest bearing liabilities to interest earning assets

66.87%

65.99%

65.61%

66.65%

70.81%

Net interest tax equivalent adjustment

$                           569

$                           709

$                           618

$                           725

$                           714

           

*Denotes non-GAAP financial measure.  Refer to related disclosure and reconciliation on pages 24 and 25.

     
           

 

               

BancorpSouth Bank

   

Consolidated Balance Sheets

   

(Unaudited)

   
               
 

Mar-21

Dec-20

Sep-20

Jun-20

Mar-20

   
 

(Dollars in thousands)

   

Assets

             

Cash and due from banks

$                263,289

$                284,095

$                306,164

$                240,354

$                253,495

   

Interest bearing deposits with other banks

             

and Federal funds sold

336,253

133,273

39,782

318,615

29,490

   

Available-for-sale securities, at fair value

7,640,268

6,231,006

5,659,785

4,973,171

4,468,340

   

Loans and leases*

15,056,559

15,039,239

15,344,006

15,444,794

14,241,912

   

  Less:  Unearned income

17,751

16,760

16,271

17,373

17,267

   

             Allowance for credit losses

241,117

244,422

250,624

237,025

218,199

   

Net loans and leases

14,797,691

14,778,057

15,077,111

15,190,396

14,006,446

   

Loans held for sale

518,352

397,076

304,215

391,051

194,321

   

Premises and equipment, net

508,508

508,147

508,149

504,748

497,669

   

Accrued interest receivable

106,355

106,318

110,185

101,321

70,463

   

Goodwill

851,612

851,612

847,531

847,984

848,242

   

Other identifiable intangibles

53,581

55,899

54,757

56,989

59,345

   

Bank owned life insurance

335,707

333,264

331,799

329,167

327,312

   

Other real estate owned

9,351

11,395

6,397

7,164

9,200

   

Other assets

381,530

391,052

309,547

275,216

268,201

   

Total Assets

$           25,802,497

$           24,081,194

$           23,555,422

$           23,236,176

$           21,032,524

   

Liabilities

             

Deposits:

             

  Demand:  Noninterest bearing

$             6,990,880

$             6,341,457

$             6,336,792

$             6,385,370

$             4,861,155

   

                  Interest bearing

9,067,373

8,524,010

8,170,402

7,907,637

7,268,053

   

  Savings

2,678,276

2,452,059

2,325,980

2,234,853

2,013,343

   

  Other time

2,436,657

2,528,915

2,579,805

2,651,626

2,745,365

   

Total deposits

21,173,186

19,846,441

19,412,979

19,179,486

16,887,916

   

Securities sold under agreement to repurchase

660,485

637,715

611,455

670,016

538,962

   

Federal funds purchased

             

   and other short-term borrowing

-

-

95,217

220

290,224

   

Accrued interest payable

11,879

10,885

15,286

13,476

17,482

   

Junior subordinated debt securities

297,425

297,250

297,074

296,898

296,723

   

Long-term debt

4,295

4,402

4,508

4,615

4,721

   

Other liabilities

830,029

462,024

336,364

338,778

314,592

   

Total Liabilities

22,977,299

21,258,717

20,772,883

20,503,489

18,350,620

   

Shareholders' Equity

             

Preferred stock

166,993

166,993

166,993

166,993

166,993

   

Common stock

256,562

256,404

256,396

256,416

256,581

   

Capital surplus

563,481

565,187

565,635

561,541

558,114

   

Accumulated other comprehensive (loss) income

(43,459)

11,923

18,490

25,191

17,849

   

Retained earnings

1,881,621

1,821,970

1,775,025

1,722,546

1,682,367

   

Total Shareholders' Equity

2,825,198

2,822,477

2,782,539

2,732,687

2,681,904

   

Total Liabilities & Shareholders' Equity

$           25,802,497

$           24,081,194

$           23,555,422

$           23,236,176

$           21,032,524

   
               
               

*Includes $1.146 billion, $975.4 million, $1.212 billion and $1.193 billion in PPP loans at March 31, 2021, December 31, 2020, September 30, 2020 and  June 30, 2020, respectively.

   
   

 

BancorpSouth Bank

   

Consolidated Average Balance Sheets

   

(Unaudited)

   
               
 

Mar-21

Dec-20

Sep-20

Jun-20

Mar-20

   
 

(Dollars in thousands)

   

Assets

             

Cash and due from banks

$                261,519

$                247,799

$                232,421

$                229,334

$                246,860

   

Interest bearing deposits with other banks

             

and Federal funds sold

412,313

171,650

257,057

760,789

239,766

   

Available-for-sale securities, at fair value

6,606,027

5,820,425

5,309,982

4,437,614

4,461,298

   

Loans and leases*

15,045,837

15,235,827

15,386,721

15,132,600

14,244,649

   

  Less:  Unearned income

16,761

16,425

17,037

17,868

17,861

   

             Allowance for credit losses

242,935

247,049

236,536

217,508

193,796

   

Net loans and leases

14,786,141

14,972,353

15,133,148

14,897,224

14,032,992

   

Loans held for sale

289,755

277,600

296,352

261,377

147,798

   

Premises and equipment, net

508,551

508,053

507,190

499,767

494,413

   

Accrued interest receivable

102,190

105,513

104,435

137,456

64,010

   

Goodwill

851,612

852,472

847,744

848,160

844,635

   

Other identifiable intangibles

54,876

54,858

56,045

58,280

58,805

   

Bank owned life insurance

333,837

332,543

330,642

328,037

326,808

   

Other real estate owned

11,043

14,872

7,754

8,410

8,151

   

Other assets

327,696

302,365

236,107

241,238

264,101

   

Total Assets

$           24,545,560

$           23,660,503

$           23,318,877

$           22,707,686

$           21,189,637

   

Liabilities

             

Deposits:

             

  Demand:  Noninterest bearing

$             6,484,703

$             6,391,006

$             6,340,942

$             5,942,570

$             4,717,202

   

                  Interest bearing

8,956,420

8,268,528

8,022,755

7,674,479

7,466,674

   

  Savings

2,550,095

2,386,034

2,280,860

2,152,092

1,975,690

   

  Other time

2,480,862

2,555,295

2,614,373

2,685,331

2,745,663

   

Total deposits

20,472,080

19,600,863

19,258,930

18,454,472

16,905,229

   

Securities sold under agreement to repurchase

651,694

672,018

681,400

644,127

541,707

   

Federal funds purchased

             

   and other short-term borrowing

1,500

3,893

36,696

269,121

502,257

   

Accrued interest payable

11,607

14,175

15,589

16,268

19,205

   

Junior subordinated debt securities

297,318

297,145

296,969

296,793

296,617

   

Long-term debt

4,378

4,488

4,592

4,699

4,800

   

Other liabilities

293,982

293,332

294,831

283,772

261,123

   

Total Liabilities

21,732,559

20,885,914

20,589,007

19,969,252

18,530,938

   

Shareholders' Equity

             

Preferred stock

166,993

166,993

166,993

166,993

167,021

   

Common stock

256,536

256,422

256,412

256,515

261,065

   

Capital surplus

563,529

568,343

563,267

559,737

600,880

   

Accumulated other comprehensive (loss) income

(5,090)

12,432

24,758

23,016

(36,367)

   

Retained earnings

1,831,033

1,770,399

1,718,440

1,732,173

1,666,100

   

Total Shareholders' Equity

2,813,001

2,774,589

2,729,870

2,738,434

2,658,699

   

Total Liabilities & Shareholders' Equity

$           24,545,560

$           23,660,503

$           23,318,877

$           22,707,686

$           21,189,637

   
               
               

*Includes $1.062 billion, $1.140 billion, $1.207 billion and $975.0 million in PPP loans for the quarter ended March 31, 2021, December 31, 2020, September 30, 2020 and June 30, 2020, respectively.

   
   

 

BancorpSouth Bank

Consolidated Condensed Statements of Income

(Dollars in thousands, except per share data)

(Unaudited)

                   
 

Quarter Ended

 

Mar-21

 

Dec-20

 

Sep-20

 

Jun-20

 

Mar-20

INTEREST REVENUE:

                 

Loans and leases

$      169,195

 

$     174,072

 

$        175,810

 

$      173,164

 

$     177,019

Deposits with other banks

108

 

50

 

74

 

207

 

739

Federal funds sold, securities purchased

                 

   under agreement to resell, FHLB and

                 

      other equity investments

6

 

6

 

52

 

178

 

315

Available-for-sale securities:

                 

    Taxable

21,192

 

21,895

 

21,280

 

20,783

 

21,508

    Tax-exempt

687

 

760

 

986

 

1,178

 

1,060

Loans held for sale

1,595

 

2,504

 

2,468

 

1,962

 

1,423

        Total interest revenue

192,783

 

199,287

 

200,670

 

197,472

 

202,064

                   

INTEREST EXPENSE:

                 

Interest bearing demand

8,796

 

9,766

 

10,773

 

11,631

 

15,522

Savings

700

 

872

 

1,012

 

943

 

1,290

Other time

6,966

 

8,189

 

9,287

 

10,296

 

11,168

Federal funds purchased and securities sold

                 

   under agreement to repurchase

203

 

276

 

279

 

291

 

1,436

Short-term and long-term debt

45

 

47

 

49

 

477

 

1,857

Junior subordinated debt

3,269

 

3,201

 

3,338

 

3,263

 

3,261

Other

15

 

-

 

1

 

1

 

-

        Total interest expense

19,994

 

22,351

 

24,739

 

26,902

 

34,534

                   

        Net interest revenue

172,789

 

176,936

 

175,931

 

170,570

 

167,530

  Provision for credit losses

-

 

5,000

 

15,000

 

20,000

 

46,000

        Net interest revenue, after provision for

                 

          credit losses

172,789

 

171,936

 

160,931

 

150,570

 

121,530

                   

NONINTEREST REVENUE:

                 

Mortgage banking

25,310

 

20,129

 

27,097

 

29,557

 

9,470

Credit card, debit card and merchant fees

9,659

 

10,053

 

9,938

 

9,080

 

9,176

Deposit service charges

8,477

 

9,708

 

8,892

 

7,647

 

11,682

Security gains(losses), net

82

 

63

 

18

 

62

 

(85)

Insurance commissions

30,667

 

29,815

 

32,750

 

33,118

 

29,603

Wealth management

8,465

 

6,751

 

6,471

 

6,421

 

6,570

Other

5,276

 

2,307

 

4,758

 

5,373

 

10,080

        Total noninterest revenue

87,936

 

78,826

 

89,924

 

91,258

 

76,496

                   

NONINTEREST EXPENSE:

                 

Salaries and employee benefits

101,060

 

97,215

 

104,219

 

108,103

 

108,272

Occupancy, net of rental income

12,814

 

13,004

 

13,053

 

12,890

 

12,708

Equipment

4,564

 

4,756

 

4,519

 

4,762

 

4,649

Deposit insurance assessments

1,455

 

1,696

 

1,522

 

1,962

 

1,546

Pension settlement expense

-

 

5,846

 

-

 

-

 

-

Other

35,930

 

45,394

 

32,192

 

34,787

 

40,831

        Total noninterest expense

155,823

 

167,911

 

155,505

 

162,504

 

168,006

        Income before income taxes

104,902

 

82,851

 

95,350

 

79,324

 

30,020

Income tax expense

23,347

 

14,046

 

21,525

 

18,164

 

5,759

        Net income

$        81,555

 

$       68,805

 

$          73,825

 

$        61,160

 

$       24,261

Less: Preferred dividends

2,372

 

2,372

 

2,372

 

2,372

 

2,372

        Net income available to common shareholders

$        79,183

 

$       66,433

 

$          71,453

 

$        58,788

 

$       21,889

                   

Net income per common share: Basic

$            0.77

 

$           0.65

 

$              0.70

 

$            0.57

 

$           0.21

                                                   Diluted

$            0.77

 

$           0.65

 

$              0.69

 

$            0.57

 

$           0.21

 

BancorpSouth Bank

Selected Loan Data

(Dollars in thousands)

(Unaudited)

                   
 

Quarter Ended

 

Mar-21

 

Dec-20

 

Sep-20

 

Jun-20

 

Mar-20

LOAN AND LEASE PORTFOLIO:

                 

Commercial and industrial

                 

   Commercial and industrial-non real estate

2,865,706

 

2,673,429

 

2,937,608

 

3,038,957

 

2,008,043

   Commercial and industrial-owner occupied

2,260,456

 

2,281,127

 

2,297,008

 

2,296,287

 

2,290,585

      Total commercial and industrial

5,126,162

 

4,954,556

 

5,234,616

 

5,335,244

 

4,298,628

Commercial real estate

                 

   Agricultural

337,710

 

317,994

 

333,839

 

333,615

 

339,539

   Construction, acquisition and development

1,707,800

 

1,728,682

 

1,700,030

 

1,658,678

 

1,582,039

   Commercial real estate

3,127,510

 

3,211,434

 

3,229,959

 

3,323,744

 

3,303,537

      Total commercial real estate

5,173,020

 

5,258,110

 

5,263,828

 

5,316,037

 

5,225,115

Consumer

                 

   Consumer mortgages

3,700,076

 

3,726,241

 

3,704,490

 

3,646,168

 

3,572,277

   Home equity

608,924

 

630,097

 

658,708

 

655,543

 

686,202

   Credit cards

81,499

 

89,077

 

85,760

 

86,592

 

93,896

      Total consumer

4,390,499

 

4,445,415

 

4,448,958

 

4,388,303

 

4,352,375

All other

349,127

 

364,398

 

380,333

 

387,837

 

348,527

      Total loans

$  15,038,808

 

$  15,022,479

 

$  15,327,735

 

$  15,427,421

 

$  14,224,645

                   

ALLOWANCE FOR CREDIT LOSSES:

                 

Balance, beginning of period

$      244,422

 

$      250,624

 

$      237,025

 

$       218,199

 

$      119,066

                   

Impact of adopting ASC 326 - cumulative effect adjustment

-

 

-

 

-

 

-

 

40,000

                   

Impact of adopting ASC 326 - purchased loans with credt

                 

   deterioration

-

 

-

 

-

 

-

 

22,634

                   

Loans and leases charged-off:

                 

Commercial and industrial

                 

   Commercial and industrial-non real estate

(2,269)

 

(4,343)

 

(560)

 

(1,506)

 

(10,792)

   Commercial and industrial-owner occupied

(677)

 

(1,168)

 

(441)

 

(13)

 

(184)

     Total commercial and industrial

(2,946)

 

(5,511)

 

(1,001)

 

(1,519)

 

(10,976)

Commercial real estate

                 

   Agricultural

(98)

 

(155)

 

-

 

(21)

 

(65)

   Construction, acquisition and development

(807)

 

(1,773)

 

-

 

(9)

 

(3,173)

   Commercial real estate

(478)

 

(3,134)

 

(738)

 

-

 

(67)

     Total commercial real estate

(1,383)

 

(5,062)

 

(738)

 

(30)

 

(3,305)

Consumer

                 

   Consumer mortgages

(293)

 

(731)

 

(81)

 

(124)

 

(524)

   Home equity

(50)

 

(395)

 

(41)

 

(162)

 

(236)

   Credit cards

(733)

 

(458)

 

(682)

 

(703)

 

(798)

     Total consumer

(1,076)

 

(1,584)

 

(804)

 

(989)

 

(1,558)

All other

(501)

 

(875)

 

(599)

 

(396)

 

(914)

     Total loans charged-off

(5,906)

 

(13,032)

 

(3,142)

 

(2,934)

 

(16,753)

                   

Recoveries:

                 

Commercial and industrial

                 

   Commercial and industrial-non real estate

1,031

 

779

 

294

 

277

 

355

   Commercial and industrial-owner occupied

62

 

37

 

163

 

136

 

1,179

     Total commercial and industrial

1,093

 

816

 

457

 

413

 

1,534

Commercial real estate

                 

   Agricultural

86

 

24

 

3

 

6

 

6

   Construction, acquisition and development

53

 

73

 

55

 

172

 

245

   Commercial real estate

56

 

45

 

209

 

50

 

135

     Total commercial real estate

195

 

142

 

267

 

228

 

386

Consumer

                 

   Consumer mortgages

403

 

230

 

352

 

345

 

397

   Home equity

220

 

151

 

132

 

259

 

80

   Credit cards

297

 

211

 

270

 

195

 

285

     Total consumer

920

 

592

 

754

 

799

 

762

All other

393

 

280

 

263

 

320

 

344

     Total recoveries

2,601

 

1,830

 

1,741

 

1,760

 

3,026

                   

Net (charge-offs)recoveries

(3,305)

 

(11,202)

 

(1,401)

 

(1,174)

 

(13,727)

                   

Initial allowance on loans purchased with credit deterioration

-

 

-

 

-

 

-

 

4,226

                   

Provision:

                 

   Initial provision for loans acquired during the quarter

-

 

-

 

-

 

-

 

1,000

   Provision for credit losses related to loans and leases

-

 

5,000

 

15,000

 

20,000

 

45,000

     Total provision

-

 

5,000

 

15,000

 

20,000

 

46,000

                   

Balance, end of period

$      241,117

 

$      244,422

 

$      250,624

 

$       237,025

 

$      218,199

                   

Average loans for period

$ 15,029,076

 

$ 15,219,402

 

$ 15,369,684

 

$ 15,114,732

 

$ 14,226,788

                   

Ratio:

                 

Net charge-offs(recoveries) to average loans (annualized)

0.09%

 

0.29%

 

0.04%

 

0.03%

 

0.39%

                   

 

BancorpSouth Bank

Selected Loan Data

(Dollars in thousands)

(Unaudited)

                     
   

Quarter Ended

   

Mar-21

 

Dec-20

 

Sep-20

 

Jun-20

 

Mar-20

BXS ORIGINATED LOANS AND LEASES:

                   
                     

Loans and leases charged off:

                   

Commercial and industrial

                   

   Commercial and industrial-non real estate

 

$        (1,971)

 

$       (1,991)

 

$          (490)

 

$           (420)

 

$          (230)

   Commercial and industrial-owner occupied

 

(187)

 

(303)

 

(434)

 

(13)

 

(19)

     Total commercial and industrial

 

(2,158)

 

(2,294)

 

(924)

 

(433)

 

(249)

Commercial real estate

                   

   Agricultural

 

(94)

 

(124)

 

-

 

-

 

(65)

   Construction, acquisition and development

 

(344)

 

(1,709)

 

-

 

-

 

(121)

   Commercial real estate

 

(27)

 

(1,704)

 

(155)

 

-

 

(67)

     Total real estate

 

(465)

 

(3,537)

 

(155)

 

-

 

(253)

Consumer

                   

   Consumer mortgages

 

(181)

 

(537)

 

(70)

 

(113)

 

(357)

   Home equity

 

(50)

 

(395)

 

(41)

 

(162)

 

(236)

   Credit cards

 

(733)

 

(458)

 

(682)

 

(703)

 

(798)

     Total consumer

 

(964)

 

(1,390)

 

(793)

 

(978)

 

(1,391)

All other

 

(399)

 

(698)

 

(459)

 

(288)

 

(704)

     Total loans charged off

 

(3,986)

 

(7,919)

 

(2,331)

 

(1,699)

 

(2,597)

                     

Recoveries:

                   

Commercial and industrial

                   

   Commercial and industrial-non real estate

 

387

 

645

 

231

 

210

 

325

   Commercial and industrial-owner occupied

 

61

 

27

 

163

 

136

 

1,177

     Total commercial and industrial

 

448

 

672

 

394

 

346

 

1,502

Commercial real estate

                   

   Agricultural

 

5

 

23

 

3

 

5

 

4

   Construction, acquisition and development

 

51

 

73

 

55

 

170

 

244

   Commercial real estate

 

36

 

45

 

208

 

50

 

135

     Total real estate

 

92

 

141

 

266

 

225

 

383

Consumer

                   

   Consumer mortgages

 

392

 

221

 

350

 

343

 

395

   Home equity

 

219

 

149

 

130

 

258

 

79

   Credit cards

 

297

 

211

 

270

 

195

 

285

     Total consumer

 

908

 

581

 

750

 

796

 

759

All other

 

325

 

249

 

235

 

275

 

316

     Total recoveries

 

1,773

 

1,643

 

1,645

 

1,642

 

2,960

                     

Net (charge-offs)/recoveries

 

$        (2,213)

 

$       (6,276)

 

$          (686)

 

$            (57)

 

$            363

 

BancorpSouth Bank

Selected Loan Data

(Dollars in thousands)

(Unaudited)

                   
 

Quarter Ended

 

Mar-21

 

Dec-20

 

Sep-20

 

Jun-20

 

Mar-20

ACQUIRED LOANS AND LEASES:

                 
                   

Loans and leases charged off:

                 

Commercial and industrial

                 

   Commercial and industrial-non real estate

$           (298)

 

$       (2,352)

 

$            (70)

 

$        (1,086)

 

$      (10,562)

   Commercial and industrial-owner occupied

(490)

 

(865)

 

(7)

 

-

 

(165)

     Total commercial and industrial

(788)

 

(3,217)

 

(77)

 

(1,086)

 

(10,727)

Commercial real estate

                 

   Agricultural

(4)

 

(31)

 

-

 

(21)

 

-

   Construction, acquisition and development

(463)

 

(64)

 

-

 

(9)

 

(3,052)

   Commercial real estate

(451)

 

(1,430)

 

(583)

 

-

 

-

     Total real estate

(918)

 

(1,525)

 

(583)

 

(30)

 

(3,052)

Consumer

                 

   Consumer mortgages

(112)

 

(194)

 

(11)

 

(11)

 

(167)

   Home equity

-

 

-

 

-

 

-

 

-

   Credit cards

-

 

-

 

-

 

-

 

-

     Total consumer

(112)

 

(194)

 

(11)

 

(11)

 

(167)

All other

(102)

 

(177)

 

(140)

 

(108)

 

(210)

     Total loans charged off

(1,920)

 

(5,113)

 

(811)

 

(1,235)

 

(14,156)

                   

Recoveries:

                 

Commercial and industrial

                 

   Commercial and industrial-non real estate

644

 

134

 

63

 

67

 

30

   Commercial and industrial-owner occupied

1

 

10

 

-

 

-

 

2

     Total commercial and industrial

645

 

144

 

63

 

67

 

32

Commercial real estate

                 

   Agricultural

81

 

1

 

-

 

1

 

2

   Construction, acquisition and development

2

 

-

 

-

 

2

 

1

   Commercial real estate

20

 

-

 

1

 

-

 

-

     Total real estate

103

 

1

 

1

 

3

 

3

Consumer

                 

   Consumer mortgages

11

 

9

 

2

 

2

 

2

   Home equity

1

 

2

 

2

 

1

 

1

   Credit cards

-

 

-

 

-

 

-

 

-

     Total consumer

12

 

11

 

4

 

3

 

3

All other

68

 

31

 

28

 

45

 

28

     Total recoveries

828

 

187

 

96

 

118

 

66

                   

Net (charge-offs)/recoveries

$        (1,092)

 

$       (4,926)

 

$          (715)

 

$        (1,117)

 

$      (14,090)

 

BancorpSouth Bank

Selected Loan Data

(Dollars in thousands)

(Unaudited)

                   
 

Quarter Ended

 

Mar-21

 

Dec-20

 

Sep-20

 

Jun-20

 

Mar-20

NON-PERFORMING ASSETS

                 

NON-PERFORMING LOANS AND LEASES:

                 

  Nonaccrual Loans and Leases

                 

    Commercial and industrial

                 

       Commercial and industrial-non real estate

$      9,703

 

$       12,768

 

$       17,936

 

$    16,124

 

$       16,589

       Commercial and industrial-owner occupied

15,019

 

15,783

 

18,343

 

16,745

 

11,212

         Total commercial and industrial

24,722

 

28,551

 

36,279

 

32,869

 

27,801

    Commercial real estate

                 

       Agricultural

2,293

 

5,013

 

5,907

 

5,244

 

5,454

       Construction, acquisition and development

8,494

 

9,738

 

10,434

 

9,715

 

13,899

       Commercial real estate

12,838

 

16,249

 

32,554

 

45,047

 

29,697

         Total commercial real estate

23,625

 

31,000

 

48,895

 

60,006

 

49,050

    Consumer

                 

       Consumer mortgages

23,535

 

32,951

 

32,872

 

30,672

 

29,834

       Home equity

847

 

2,657

 

3,325

 

2,584

 

2,597

       Credit cards

131

 

173

 

144

 

90

 

122

         Total consumer

24,513

 

35,781

 

36,341

 

33,346

 

32,553

    All other

282

 

1,046

 

593

 

532

 

670

         Total nonaccrual loans and leases

$    73,142

 

$       96,378

 

$      122,108

 

$  126,753

 

$      110,074

                   

  Loans and Leases 90+ Days Past Due, Still Accruing:

21,208

 

14,320

 

17,641

 

9,877

 

7,272

  Restructured Loans and Leases, Still Accruing

6,971

 

10,475

 

11,154

 

11,575

 

11,284

     Total non-performing loans and leases

$  101,321

 

$      121,173

 

$      150,903

 

$  148,205

 

$      128,630

                   

OTHER REAL ESTATE OWNED:

9,351

 

11,395

 

6,397

 

7,164

 

9,200

                   

Total Non-performing Assets

$  110,672

 

$      132,568

 

$      157,300

 

$  155,369

 

$      137,830

                   

  BXS originated assets

$    85,266

 

$       97,025

 

$      109,418

 

$    94,155

 

$       85,908

  Acquired assets

25,406

 

35,543

 

47,882

 

61,214

 

51,922

Total Non-performing Assets

$  110,672

 

$      132,568

 

$      157,300

 

$  155,369

 

$      137,830

                   

Additions to Nonaccrual Loans and Leases During the Quarter

$    10,029

 

$       11,087

 

$       19,973

 

$    36,619

 

$       47,523

                   

Loans and Leases 30-89 Days Past Due, Still Accruing:

                 

    BXS originated loans

$    34,929

 

$       40,424

 

$       42,978

 

$    35,002

 

$       54,315

    Acquired loans

2,798

 

6,048

 

5,694

 

10,450

 

14,405

         Total Loans and Leases 30-89 days past due, still accruing

$    37,727

 

$       46,472

 

$       48,672

 

$    45,452

 

$       68,720

                   

 

BancorpSouth Bank

 

Selected Loan Data

 

(Dollars in thousands)

 

(Unaudited)

 
                     
 

March 31, 2021

 
             

Purchased

     
   

Special

       

Credit

     
 

Pass

Mention

Substandard

Doubtful

Loss

Impaired

Deteriorated (Loss)

 

Total

 

LOAN PORTFOLIO BY INTERNALLY ASSIGNED GRADE:

                   

Commercial and industrial

                   

   Commercial and industrial-non real estate

$   2,825,297

$                -

$       30,526

$        171

$                -

$    1,909

$                7,803

 

$          2,865,706

 

   Commercial and industrial-owner occupied

2,184,516

3,471

58,754

-

-

11,086

2,629

 

2,260,456

 

     Total commercial and industrial

5,009,813

3,471

89,280

171

-

12,995

10,432

 

5,126,162

 

Commercial real estate

                   

   Agricultural

331,802

-

2,877

-

-

705

2,326

 

337,710

 

   Construction, acquisition and development

1,659,787

1,534

38,665

-

-

2,448

5,366

 

1,707,800

 

   Commercial real estate

2,987,075

-

127,147

-

-

9,642

3,646

 

3,127,510

 

     Total commercial real estate

4,978,664

1,534

168,689

-

-

12,795

11,338

 

5,173,020

 

Consumer

                   

   Consumer mortgages

3,629,182

-

67,881

-

-

2,825

188

 

3,700,076

 

   Home equity

603,768

-

5,156

-

-

-

-

 

608,924

 

   Credit cards

81,499

-

-

-

-

-

-

 

81,499

 

     Total consumer

4,314,449

-

73,037

-

-

2,825

188

 

4,390,499

 

All other

343,656

-

5,404

-

-

-

67

 

349,127

 

     Total loans

$ 14,646,582

$         5,005

$      336,410

$        171

$                -

$  28,615

$              22,025

 

$         15,038,808

 
                     

  BXS originated loans

$ 13,635,053

$         5,005

$      252,140

$        171

$                -

$  18,188

$                    -

 

$         13,910,557

 

  Acquired loans*

1,011,529

-

84,270

-

-

10,427

22,025

 

1,128,251

 

     Total Loans

$ 14,646,582

$         5,005

$      336,410

$        171

$                -

$  28,615

$              22,025

 

$         15,038,808

 
                     
 

December 31, 2020

 
             

Purchased

     
   

Special

       

Credit

     
 

Pass

Mention

Substandard

Doubtful

Loss

Impaired

Deteriorated (Loss)

 

Total

 

LOAN PORTFOLIO BY INTERNALLY ASSIGNED GRADE:

                   

Commercial and industrial

                   

   Commercial and industrial-non real estate

$   2,616,471

$         7,202

$       39,040

$        172

$                -

$    1,949

$                8,595

 

$          2,673,429

 

   Commercial and industrial-owner occupied

2,208,214

-

58,683

-

-

11,579

2,651

 

2,281,127

 

     Total commercial and industrial

4,824,685

7,202

97,723

172

-

13,528

11,246

 

4,954,556

 

Commercial real estate

                   

   Agricultural

310,766

-

4,526

-

-

777

1,925

 

317,994

 

   Construction, acquisition and development

1,686,907

1,534

32,363

-

-

2,054

5,824

 

1,728,682

 

   Commercial real estate

3,062,894

-

134,054

-

-

10,780

3,706

 

3,211,434

 

     Total commercial real estate

5,060,567

1,534

170,943

-

-

13,611

11,455

 

5,258,110

 

Consumer

                   

   Consumer mortgages

3,645,357

-

78,287

-

-

2,406

191

 

3,726,241

 

   Home equity

624,581

-

5,516

-

-

-

-

 

630,097

 

   Credit cards

89,077

-

-

-

-

-

-

 

89,077

 

     Total consumer

4,359,015

-

83,803

-

-

2,406

191

 

4,445,415

 

All other

357,812

-

6,519

-

-

-

67

 

364,398

 

     Total loans

$ 14,602,079

$         8,736

$      358,988

$        172

$                -

$  29,545

$              22,959

 

$         15,022,479

 
                     

  BXS originated loans

$ 13,459,529

$         8,736

$      259,682

$        172

$                -

$  17,520

$                    -

 

$         13,745,639

 

  Acquired loans*

1,142,550

-

99,306

-

-

12,025

22,959

 

1,276,840

 

     Total Loans

$ 14,602,079

$         8,736

$      358,988

$        172

$                -

$  29,545

$              22,959

 

$         15,022,479

 
                     
                     

*Includes certain loans that are no longer included in the "Net book value of acquired loans" on page 10 as a result of maturity, refinance, or other triggering event.

     

 

BancorpSouth Bank

Selected Loan Data

(Dollars in thousands)

(Unaudited)

                   
                   
                   
 

Quarter Ended

 

Mar-21

 

Dec-20

 

Sep-20

 

Jun-20

 

Mar-20

LOAN PORTFOLIO BY INTERNALLY ASSIGNED GRADE:

                 

Pass

$ 14,646,582

 

$ 14,602,079

 

$ 14,877,943

 

$ 14,985,673

 

$  13,821,602

Special Mention

5,005

 

8,736

 

-

 

4,264

 

7,129

Substandard

336,410

 

358,988

 

372,483

 

350,264

 

323,697

Doubtful

171

 

172

 

178

 

179

 

191

Loss

-

 

-

 

-

 

-

 

667

Impaired

28,615

 

29,545

 

49,818

 

57,406

 

40,627

Purchased Credit Deteriorated (Loss)

22,025

 

22,959

 

27,313

 

29,635

 

30,732

   Total

$ 15,038,808

 

$ 15,022,479

 

$ 15,327,735

 

$ 15,427,421

 

$  14,224,645

                   

BXS ORIGINATED LOAN PORTFOLIO BY INTERNALLY

                 

   ASSIGNED GRADE:

                 

Pass

$ 13,635,053

 

$ 13,459,529

 

$ 13,592,460

 

$ 13,516,292

 

$  12,150,616

Special Mention

5,005

 

8,736

 

-

 

2,741

 

2,045

Substandard

252,140

 

259,682

 

252,875

 

231,687

 

225,506

Doubtful

171

 

172

 

178

 

179

 

191

Loss

-

 

-

 

-

 

-

 

-

Impaired

18,188

 

17,520

 

30,909

 

28,288

 

22,356

Purchased Credit Deteriorated (Loss)

-

 

-

 

-

 

-

 

-

   Total

$ 13,910,557

 

$ 13,745,639

 

$ 13,876,422

 

$ 13,779,187

 

$  12,400,714

                   

ACQUIRED LOAN PORTFOLIO BY INTERNALLY

                 

   ASSIGNED GRADE:

                 

Pass

$  1,011,529

 

$   1,142,550

 

$  1,285,483

 

$   1,469,381

 

$    1,670,986

Special Mention

-

 

-

 

-

 

1,523

 

5,084

Substandard

84,270

 

99,306

 

119,608

 

118,577

 

98,191

Doubtful

-

 

-

 

-

 

-

 

-

Loss

-

 

-

 

-

 

-

 

667

Impaired

10,427

 

12,025

 

18,909

 

29,118

 

18,271

Purchased Credit Deteriorated (Loss)

22,025

 

22,959

 

27,313

 

29,635

 

30,732

   Total

$  1,128,251

 

$   1,276,840

 

$  1,451,313

 

$   1,648,234

 

$    1,823,931

                   

 

BancorpSouth Bank

Geographical Information

(Dollars in thousands)

(Unaudited)

                   
 

March 31, 2021

 

Alabama

               
 

and Florida

               
 

Panhandle

Arkansas

Louisiana

Mississippi

Missouri

Tennessee

Texas

Other

Total

LOAN AND LEASE PORTFOLIO:

                 

Commercial and industrial

                 

   Commercial and industrial-non real estate

$    254,421

$    205,840

$    331,255

$    674,111

$      87,701

$    175,804

$ 1,132,825

$       3,749

$   2,865,706

   Commercial and industrial-owner occupied

265,198

180,900

229,123

592,555

64,563

123,882

787,661

16,574

2,260,456

     Total commercial and industrial

519,619

386,740

560,378

1,266,666

152,264

299,686

1,920,486

20,323

5,126,162

Commercial real estate

                 

   Agricultural

26,692

69,704

22,287

69,210

7,834

11,234

130,343

406

337,710

   Construction, acquisition and development

202,159

52,596

74,407

346,196

12,741

83,245

936,258

198

1,707,800

   Commercial real estate

316,143

320,806

243,605

645,649

204,343

218,316

1,177,921

727

3,127,510

     Total commercial real estate

544,994

443,106

340,299

1,061,055

224,918

312,795

2,244,522

1,331

5,173,020

Consumer

                 

   Consumer mortgages

594,984

319,060

326,864

811,487

110,284

327,596

1,157,824

51,977

3,700,076

   Home equity

92,721

44,282

73,245

209,906

16,218

130,875

41,573

104

608,924

   Credit cards

-

-

-

-

-

-

-

81,499

81,499

     Total consumer

687,705

363,342

400,109

1,021,393

126,502

458,471

1,199,397

133,580

4,390,499

All other

48,036

36,285

46,268

117,094

2,030

22,245

73,793

3,376

349,127

     Total loans

$ 1,800,354

$ 1,229,473

$ 1,347,054

$ 3,466,208

$    505,714

$ 1,093,197

$ 5,438,198

$    158,610

$ 15,038,808

                   

Loan growth, excluding loans acquired during

                 

    the quarter (annualized)

3.07%

(10.00%)

(4.59%)

(6.36%)

(13.63%)

3.29%

9.32%

(21.40%)

0.44%

Loan growth, excluding PPP loans (annualized)

(0.62%)

(13.30%)

(13.71%)

(9.37%)

(16.50%)

(1.02%)

4.46%

(41.87%)

(4.16%)

                   

NON-PERFORMING LOANS AND LEASES:

                 

Commercial and industrial

                 

   Commercial and industrial-non real estate

$          188

$          776

$       1,176

$          841

$       1,162

$          422

$       5,546

$          156

$       10,267

   Commercial and industrial-owner occupied

607

1,225

373

1,512

166

-

13,351

-

17,234

     Total commercial and industrial

795

2,001

1,549

2,353

1,328

422

18,897

156

27,501

Commercial real estate

                 

   Agricultural

63

337

-

965

-

-

1,522

-

2,887

   Construction, acquisition and development

-

131

1,149

83

-

189

10,838

-

12,390

   Commercial real estate

2,027

243

1,766

896

-

-

8,584

-

13,516

     Total commercial real estate

2,090

711

2,915

1,944

-

189

20,944

-

28,793

Consumer

                 

   Consumer mortgages

11,093

2,942

2,975

11,157

1,120

2,597

8,481

2,027

42,392

   Home equity

163

52

298

388

87

131

294

-

1,413

   Credit cards

-

-

-

-

-

-

-

832

832

     Total consumer

11,256

2,994

3,273

11,545

1,207

2,728

8,775

2,859

44,637

All other

43

1

45

42

-

3

234

22

390

     Total loans

$      14,184

$       5,707

$       7,782

$      15,884

$       2,535

$       3,342

$      48,850

$       3,037

$      101,321

                   

NON-PERFORMING LOANS AND LEASES

                 

   AS A PERCENTAGE OF OUTSTANDING:

                 

Commercial and industrial

                 

   Commercial and industrial-non real estate

0.07%

0.38%

0.36%

0.12%

1.32%

0.24%

0.49%

4.16%

0.36%

   Commercial and industrial-owner occupied

0.23%

0.68%

0.16%

0.26%

0.26%

0.00%

1.70%

0.00%

0.76%

     Total commercial and industrial

0.15%

0.52%

0.28%

0.19%

0.87%

0.14%

0.98%

0.77%

0.54%

Commercial real estate

                 

   Agricultural

0.24%

0.48%

0.00%

1.39%

0.00%

0.00%

1.17%

0.00%

0.85%

   Construction, acquisition and development

0.00%

0.25%

1.54%

0.02%

0.00%

0.23%

1.16%

0.00%

0.73%

   Commercial real estate

0.64%

0.08%

0.72%

0.14%

0.00%

0.00%

0.73%

0.00%

0.43%

     Total commercial real estate

0.38%

0.16%

0.86%

0.18%

0.00%

0.06%

0.93%

0.00%

0.56%

Consumer

                 

   Consumer mortgages

1.86%

0.92%

0.91%

1.37%

1.02%

0.79%

0.73%

3.90%

1.15%

   Home equity

0.18%

0.12%

0.41%

0.18%

0.54%

0.10%

0.71%

0.00%

0.23%

   Credit cards

N/A

N/A

N/A

N/A

N/A

N/A

N/A

1.02%

1.02%

     Total consumer

1.64%

0.82%

0.82%

1.13%

0.95%

0.60%

0.73%

2.14%

1.02%

All other

0.09%

0.00%

0.10%

0.04%

0.00%

0.01%

0.32%

0.65%

0.11%

     Total loans

0.79%

0.46%

0.58%

0.46%

0.50%

0.31%

0.90%

1.91%

0.67%

                   

 

BancorpSouth Bank

Noninterest Revenue and Expense

(Dollars in thousands)

(Unaudited)

                     
 

Quarter Ended

 
 

Mar-21

 

Dec-20

 

Sep-20

 

Jun-20

 

Mar-20

 

NONINTEREST REVENUE:

                   

Mortgage banking excl. MSR and MSR Hedge market value adj

$    17,929

 

$       19,917

 

$       26,667

 

$    31,930

 

$       20,553

 

MSR and MSR Hedge market value adjustment

7,381

 

212

 

430

 

(2,373)

 

(11,083)

 

Credit card, debit card and merchant fees

9,659

 

10,053

 

9,938

 

9,080

 

9,176

 

Deposit service charges

8,477

 

9,708

 

8,892

 

7,647

 

11,682

 

Securities gains (losses), net

82

 

63

 

18

 

62

 

(85)

 

Insurance commissions

30,667

 

29,815

 

32,750

 

33,118

 

29,603

 

Trust income

5,129

 

4,046

 

3,902

 

4,064

 

4,013

 

Annuity fees

51

 

53

 

53

 

54

 

55

 

Brokerage commissions and fees

3,285

 

2,652

 

2,516

 

2,303

 

2,502

 

Bank-owned life insurance

2,020

 

2,425

 

1,902

 

1,855

 

1,999

 

Other miscellaneous income

3,256

 

(118)

 

2,856

 

3,518

 

8,081

 

     Total noninterest revenue

$    87,936

 

$       78,826

 

$       89,924

 

$    91,258

 

$       76,496

 
                     

NONINTEREST EXPENSE:

                   

Salaries and employee benefits

$  101,060

 

$       97,215

 

$      104,219

 

$  108,103

 

$      108,272

 

Occupancy, net of rental income

12,814

 

13,004

 

13,053

 

12,890

 

12,708

 

Equipment

4,564

 

4,756

 

4,519

 

4,762

 

4,649

 

Deposit insurance assessments

1,455

 

1,696

 

1,522

 

1,962

 

1,546

 

Pension settlement expense

-

 

5,846

 

-

 

-

 

-

 

Advertising

1,004

 

899

 

826

 

918

 

1,099

 

Foreclosed property expense

1,021

 

2,122

 

(278)

 

1,306

 

924

 

Telecommunications

1,398

 

1,448

 

1,462

 

1,512

 

1,461

 

Public relations

741

 

897

 

1,130

 

459

 

680

 

Data processing

10,424

 

9,980

 

9,477

 

9,693

 

9,646

 

Computer software

5,113

 

5,301

 

4,779

 

4,979

 

4,315

 

Amortization of intangibles

2,318

 

2,499

 

2,357

 

2,355

 

2,394

 

Legal

1,166

 

1,474

 

(316)

 

1,375

 

898

 

Merger expense

1,649

 

212

 

129

 

510

 

4,494

 

Postage and shipping

1,547

 

1,418

 

1,199

 

1,198

 

1,441

 

Other miscellaneous expense

9,549

 

19,144

 

11,427

 

10,482

 

13,479

 

     Total noninterest expense

$  155,823

 

$      167,911

 

$      155,505

 

$  162,504

 

$      168,006

 
                     

INSURANCE COMMISSIONS:

                   

Property and casualty commissions

$    21,949

 

$       21,304

 

$       24,060

 

$    23,644

 

$       21,246

 

Life and health commissions

6,494

 

5,915

 

6,072

 

6,771

 

6,175

 

Risk management income

613

 

829

 

609

 

540

 

532

 

Other

1,611

 

1,767

 

2,009

 

2,163

 

1,650

 

     Total insurance commissions

$    30,667

 

$       29,815

 

$       32,750

 

$    33,118

 

$       29,603

 
                     

 

BancorpSouth Bank

Selected Additional Information

(Dollars in thousands)

(Unaudited)

           
 

Quarter Ended

 

Mar-21

Dec-20

Sep-20

Jun-20

Mar-20

MORTGAGE SERVICING RIGHTS:

         

Fair value, beginning of period

$      47,571

$       44,944

$       40,821

$      42,243

$       57,109

Additions to mortgage servicing rights:

         

   Originations of servicing assets

5,588

6,608

7,041

4,297

3,079

Changes in fair value:

         

   Due to payoffs/paydowns

(3,273)

(3,898)

(3,198)

(3,144)

(2,506)

   Due to change in valuation inputs or

         

     assumptions used in the valuation model

10,446

(83)

280

(2,575)

(15,438)

   Other changes in fair value

-

-

-

-

(1)

Fair value, end of period

$      60,332

$       47,571

$       44,944

$      40,821

$       42,243

           

MORTGAGE BANKING REVENUE:

         

Production revenue:

         

   Origination

$      15,955

$       18,561

$       23,632

$      30,194

$       17,906

   Servicing

5,247

5,254

6,233

4,880

5,153

   Payoffs/Paydowns

(3,273)

(3,898)

(3,198)

(3,144)

(2,506)

     Total production revenue

17,929

19,917

26,667

31,930

20,553

Market value adjustment on MSR

10,446

(83)

280

(2,575)

(15,438)

Market value adjustment on MSR Hedge

(3,065)

295

150

202

4,355

Total mortgage banking revenue

$      25,310

$       20,129

$       27,097

$      29,557

$         9,470

           
           
           

Mortgage loans serviced

$ 7,259,808

$   7,330,293

$   7,218,090

$ 7,000,425

$   6,999,383

MSR/mtg loans serviced

0.83%

0.65%

0.62%

0.58%

0.60%

           

AVAILABLE-FOR-SALE SECURITIES, at fair value

         

U.S. Government agencies

2,642,646

2,871,408

$   3,116,458

$ 3,348,206

$   3,532,905

U.S. Government agency issued residential

         

   mortgage-back securities

3,438,246

2,421,409

1,625,325

699,864

132,902

U.S. Government agency issued commercial

         

   mortgage-back securities

1,414,345

806,206

758,116

759,980

595,885

Obligations of states and political subdivisions

126,589

113,953

141,896

163,121

206,648

Corporate bonds

18,442

18,030

17,990

2,000

-

Total available-for-sale securities

$ 7,640,268

$   6,231,006

$   5,659,785

$ 4,973,171

$   4,468,340

           

 

BancorpSouth Bank

Reconciliation of Non-GAAP Measures and Other Non-GAAP Ratio Definitions

(Dollars in thousands, except per share amounts)

(Unaudited)

 
 

Management evaluates the Company's capital position and operating performance by utilizing certain financial measures not calculated in accordance with U.S. Generally Accepted Accounting Principles (GAAP), including net operating income, net operating income available to common shareholders, net operating income-excluding MSR, net operating income available to common shareholders-excluding MSR, pre-tax pre-provision net revenue, total operating expense, tangible shareholders' equity to tangible assets, tangible shareholders' equity to tangible assets-excluding PPP loans, tangible common shareholders' equity to tangible assets, tangible common shareholders' equity to tangible assets-excluding PPP loans, return on average tangible equity, return on average tangible common equity, operating return on average tangible equity-excluding MSR, operating return on average tangible common equity-excluding MSR,  operating return on average assets-excluding MSR, operating return on average shareholders' equity-excluding MSR, operating return on average common shareholders' equity-excluding MSR, pre-tax pre-provision net revenue to total average assets, average tangible book value per common share, operating earnings per common share, operating earnings per common share-excluding MSR, efficiency ratio (tax equivalent) and operating efficiency ratio-excluding MSR (tax equivalent).  The Company has included these non-GAAP financial measures in this news release for the applicable periods presented.  Management believes that the presentation of these non-GAAP financial measures (i) provides important supplemental information that contributes to a proper understanding of the Company's capital position and operating performance, (ii) enables a more complete understanding of factors and trends affecting the Company's business and (iii) allows investors to evaluate the Company's performance in a manner similar to management, the financial services industry, bank stock analysts and bank regulators.  Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures are presented in the tables below.  These non-GAAP financial measures should not be considered as substitutes for GAAP financial measures, and the Company strongly encourages investors to review the GAAP financial measures included in this news release and not to place undue reliance upon any single financial measure.  In addition, because non-GAAP financial measures are not standardized, it may not be possible to compare the non-GAAP financial measures presented in this news release with other companies' non-GAAP financial measures having the same or similar names.

 

Reconciliation of Net Operating Income, Net Operating Income Available to Common Shareholders, Net Operating Income-Excluding MSR, and Net Operating Income Available to Common Shareholders-excluding MSR to Net Income:

 

     

Quarter ended

     

3/31/2021

 

12/31/2020

 

9/30/2020

 

6/30/2020

 

3/31/2020

                       

Net income

 

$      81,555

 

$      68,805

 

$       73,825

 

$          61,160

 

$          24,261

Plus:

Merger expense, net of tax

 

1,238

 

159

 

97

 

383

 

3,372

 

Initial provision for acquired loans,

                   
 

  net of tax

 

-

 

-

 

-

 

-

 

751

 

Pension settlement expense, net of tax

 

-

 

4,388

 

-

 

-

 

-

Less:

Security gains(losses), net of tax

 

62

 

48

 

13

 

47

 

(64)

Net operating income

 

$      82,731

 

$      73,304

 

$       73,909

 

$          61,496

 

$          28,448

Less:

Preferred dividends

 

2,372

 

2,372

 

2,372

 

2,372

 

2,372

Net operating income available to

                   

common shareholders

 

$      80,359

 

$      70,932

 

$       71,537

 

$          59,124

 

$          26,076

                       
                       

Net operating income

 

$      82,731

 

$      73,304

 

$       73,909

 

$          61,496

 

$          28,448

Less:

MSR market value adjustment, net of tax

 

5,539

 

159

 

323

 

(1,781)

 

(8,318)

Net operating income-excluding MSR

 

$      77,192

 

$      73,145

 

$       73,586

 

$          63,277

 

$          36,766

Less:

Preferred dividends

 

2,372

 

2,372

 

2,372

 

2,372

 

2,372

Net operating income available to common

                   

shareholders-excluding MSR

 

$      74,820

 

$      70,773

 

$       71,214

 

$          60,905

 

$          34,394

                       
                       

Reconciliation of Net Income to Pre-Tax Pre-Provision Net Revenue

             
                       

Net income

 

$      81,555

 

$      68,805

 

$       73,825

 

$          61,160

 

$          24,261

Plus:

Provision for credit losses

 

-

 

5,000

 

15,000

 

20,000

 

46,000

 

Merger expense

 

1,649

 

212

 

129

 

510

 

4,494

 

Pension settlement expense

 

-

 

5,846

 

-

 

-

 

-

 

Income tax expense

 

23,347

 

14,046

 

21,525

 

18,164

 

5,759

Less:

Security gains(losses)

 

82

 

63

 

18

 

62

 

(85)

 

MSR market value adjustment

 

7,381

 

212

 

430

 

(2,373)

 

(11,083)

Pre-tax pre-provision net revenue

 

$      99,088

 

$      93,634

 

$     110,031

 

$         102,145

 

$          91,682

                       
                       

Reconciliation of Total Operating Expense to Total Noninterest Expense:

           
                       

Total noninterest expense

 

$    155,823

 

$    167,911

 

$     155,505

 

$         162,504

 

$         168,006

Less:

Merger expense

 

1,649

 

212

 

129

 

510

 

4,494

 

Pension settlement expense

 

-

 

5,846

 

-

 

-

 

-

Total operating expense

 

$    154,174

 

$    161,853

 

$     155,376

 

$         161,994

 

$         163,512

                       

 

BancorpSouth Bank

Reconciliation of Non-GAAP Measures and Other Non-GAAP Ratio Definitions

(Dollars in thousands, except per share amounts)

(Unaudited)

                       
                       
                       

Reconciliation of Tangible Assets and Tangible Shareholders' Equity to

                   

Total Assets and Total Shareholders' Equity:

                   
                       
     

Quarter ended

     

3/31/2021

 

12/31/2020

 

9/30/2020

 

6/30/2020

 

3/31/2020

Tangible assets

                   

Total assets

 

$ 25,802,497

 

$  24,081,194

 

$  23,555,422

 

$ 23,236,176

 

$  21,032,524

Less: 

Goodwill

 

851,612

 

851,612

 

847,531

 

847,984

 

848,242

 

Other identifiable intangible assets

 

53,581

 

55,899

 

54,757

 

56,989

 

59,345

Total tangible assets

 

$ 24,897,304

 

$  23,173,683

 

$  22,653,134

 

$ 22,331,203

 

$  20,124,937

Less: 

PPP loans

 

1,146,000

 

975,421

 

1,212,246

 

1,192,715

 

-

Total tangible assets-excluding PPP loans

 

$ 23,751,304

 

$  22,198,262

 

$  21,440,888

 

$ 21,138,488

 

$  20,124,937

                       

PERIOD END BALANCES:

                   

Tangible shareholders' equity

                   

Total shareholders' equity

 

$   2,825,198

 

$    2,822,477

 

$    2,782,539

 

$   2,732,687

 

$    2,681,904

Less:

Goodwill

 

851,612

 

851,612

 

847,531

 

847,984

 

848,242

 

Other identifiable intangible assets

 

53,581

 

55,899

 

54,757

 

56,989

 

59,345

Total tangible shareholders' equity

 

$   1,920,005

 

$    1,914,966

 

$    1,880,251

 

$   1,827,714

 

$    1,774,317

Less:

Preferred stock

 

166,993

 

166,993

 

166,993

 

166,993

 

166,993

Total tangible common shareholders' equity

 

$   1,753,012

 

$    1,747,973

 

$    1,713,258

 

$   1,660,721

 

$    1,607,324

                       

AVERAGE BALANCES:

                   

Tangible shareholders' equity

                   

Total shareholders' equity

 

$   2,813,001

 

$    2,774,589

 

$    2,729,870

 

$   2,738,434

 

$    2,658,699

Less:

Goodwill

 

851,612

 

852,472

 

847,744

 

848,160

 

844,635

 

Other identifiable intangible assets

 

54,876

 

54,858

 

56,045

 

58,280

 

58,805

Total tangible shareholders' equity

 

$   1,906,513

 

$    1,867,259

 

$    1,826,081

 

$   1,831,994

 

$    1,755,259

Less:

Preferred stock

 

166,993

 

166,993

 

166,993

 

166,993

 

167,021

Total tangible common shareholders' equity

 

$   1,739,520

 

$    1,700,266

 

$    1,659,088

 

$   1,665,001

 

$    1,588,238

                       

Total average assets

 

$ 24,545,560

 

$  23,660,503

 

$  23,318,877

 

$ 22,707,686

 

$  21,189,637

Total shares of common stock outstanding

 

102,624,818

 

102,561,480

 

102,558,459

 

102,566,301

 

102,632,484

Average shares outstanding-diluted

 

102,711,584

 

102,817,409

 

102,839,749

 

102,827,225

 

104,733,897

                       

Tangible shareholders' equity to tangible assets (1)

 

7.71%

 

8.26%

 

8.30%

 

8.18%

 

8.82%

Tangible shareholders' equity to tangible assets-excluding PPP loans (2)

 

8.08%

 

8.63%

 

8.77%

 

8.65%

 

8.82%

Tangible common shareholders' equity to tangible assets (3)

 

7.04%

 

7.54%

 

7.56%

 

7.44%

 

7.99%

Tangible common shareholders' equity to tangible assets-excluding PPP loans (4)

 

7.38%

 

7.87%

 

7.99%

 

7.86%

 

7.99%

Return on average tangible equity (5)

 

17.35%

 

14.66%

 

16.08%

 

13.43%

 

5.56%

Return on average tangible common equity (6)

 

18.46%

 

15.54%

 

17.13%

 

14.20%

 

5.54%

Operating return on average tangible equity-excluding MSR (7)

 

16.42%

 

15.58%

 

16.03%

 

13.89%

 

8.42%

Operating return on average tangible common equity-excluding MSR (8)

 

17.44%

 

16.56%

 

17.08%

 

14.71%

 

8.71%

Operating return on average assets-excluding MSR (9)

 

1.28%

 

1.23%

 

1.26%

 

1.12%

 

0.70%

Operating return on average shareholders' equity-excluding MSR (10)

 

11.13%

 

10.49%

 

10.72%

 

9.29%

 

5.56%

Operating return on average common shareholders' equity-excluding MSR (11)

 

11.47%

 

10.80%

 

11.05%

 

9.53%

 

5.55%

Pre-tax pre-provision net revenue to total average assets (12)

 

1.64%

 

1.57%

 

1.88%

 

1.81%

 

1.74%

Tangible book value per common share (13)

 

$         17.08

 

$          17.04

 

$          16.71

 

$         16.19

 

$         15.66

Operating earnings per common share (14)

 

$           0.78

 

$            0.69

 

$            0.70

 

$           0.57

 

$           0.25

Operating earnings per common share-excluding MSR (15)

 

$           0.73

 

$            0.69

 

$            0.69

 

$           0.59

 

$           0.33

                       

 

(1)

Tangible shareholders' equity to tangible assets is defined by the Company as total shareholders' equity less goodwill and other identifiable intangible assets, divided by the difference of total assets less goodwill and other identifiable intangible assets.

(2)

Tangible shareholders' equity to tangible assets-excluding PPP loans is defined by the Company as total shareholders' equity less goodwill and other identifiable intangible assets, divided by the difference of total assets less goodwill, other identifiable intangible assets, and PPP loans.

(3)

Tangible common shareholders' equity to tangible assets is defined by the Company as total shareholders' equity less preferred stock, goodwill and other identifiable intangible assets, divided by the difference of total assets less goodwill and other identifiable intangible assets.

(4)

Tangible common shareholders' equity to tangible assets-excluding PPP loans is defined by the Company as total shareholders' equity less preferred stock, goodwill and other identifiable intangible assets, divided by the difference of total assets less goodwill, other identifiable intangible assets, and PPP loans.

(5)

Return on average tangible equity is defined by the Company as annualized net income divided by average tangible shareholders' equity.

(6)

Return on average tangible common equity is defined by the Company as annualized net income available to common shareholders divided by average tangible common shareholders' equity.

(7)

Operating return on average tangible equity-excluding MSR is defined by the Company as annualized net operating income-excluding MSR divided by average tangible shareholders' equity.

(8)

Operating return on average tangible common equity-excluding MSR is defined by the Company as annualized net operating income available to common shareholders-excluding MSR divided by average tangible common shareholders' equity.

(9)

Operating return on average assets-excluding MSR is defined by the Company as annualized net operating income-excluding MSR divided by total average assets.

(10)

Operating return on average shareholders' equity-excluding MSR is defined by the Company as annualized net operating income-excluding MSR divided by average shareholders' equity.

(11)

Operating return on average common shareholders' equity-excluding MSR is defined by the Company as annualized net operating income available to common shareholders-excluding MSR divided by average common shareholders' equity.

(12)

Pre-tax pre-provision net revenue to total average assets is defined by the Company as annualized pre-tax pre-provision net revenue divided by total average assets adjusted for other non-operating items included in the definition and calculation of net operating income-excluding MSR.

(13)

Tangible book value per common share is defined by the Company as tangible common shareholders' equity divided by total shares of common stock outstanding.

                       

(14)

Operating earnings per common share is defined by the Company as net operating income available to common shareholders divided by average common shares outstanding-diluted.

                       

(15)

Operating earnings per common share-excluding MSR is defined by the Company as net operating income available to common shareholders-excluding MSR divided by average common shares outstanding-diluted.

                       

Efficiency Ratio (tax equivalent) and Operating Efficiency Ratio-excluding MSR (tax equivalent) Definitions

 

The efficiency ratio (tax equivalent) and the operating efficiency ratio-excluding MSR (tax equivalent) are supplemental financial measures utilized in management's internal evaluation of the Company's use of resources and are not defined under GAAP. The efficiency ratio (tax equivalent) is calculated by dividing total noninterest expense by total revenue, which includes net interest income plus noninterest income plus the tax equivalent adjustment.  The operating efficiency ratio-excluding MSR (tax equivalent) excludes expense  items otherwise disclosed as non-operating from total noninterest expense.  In addition, the MSR valuation adjustment as well as securities gains and losses are excluded from total revenue.

 

 

SOURCE BancorpSouth Bank

For further information: John G. Copeland, Senior Executive Vice President and Chief Financial Officer, 662/680-2536, or Will Fisackerly, Executive Vice President and Director of Corporate Finance, 662/680-2475

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