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22.01.2020 22:30:00

BancorpSouth Announces Record Annual Earnings

TUPELO, Miss., Jan. 22, 2020 /PRNewswire/ -- BancorpSouth Bank (NYSE: BXS) (the "Company") today announced financial results for the quarter and year ended December 31, 2019.

Annual highlights for 2019 included:

  • Surpassed $20 billion in total assets for the first time in the Company's history, ending the year at $21.1 billion in total assets.
  • Achieved record net income of $234.3 million, or $2.30 per diluted common share, and record net operating income – excluding mortgage servicing rights ("MSR") – of $255.4 million, or $2.51 per diluted common share, which represents an increase of 12.6 percent on a per share basis compared to 2018.
  • Net interest margin – excluding accretable yield – increased to 3.72 percent from 3.64 percent for 2018.
  • Generated organic total deposit growth of approximately $1.0 billion, or 7 percent for the year.
  • Continued strong credit quality reflected by provision for credit losses of $1.5 million for the year; net charge-offs of $2.5 million for 2019, which represents 0.02 percent of average loans.
  • Improvement in cost structure; operating efficiency ratio – excluding MSR – improved to 64.9 percent compared to 66.6 percent for 2018.
  • Completed mergers with Casey Bancorp, Inc., Merchants Trust, Inc., Van Alstyne Financial Corporation and Summit Financial Enterprises, Inc. – collectively contributing $1.0 billion in loans and $1.3 billion in deposits.
  • Repurchased 2,466,438 shares of outstanding common stock at a weighted average price of $28.20 per share.

Highlights for the fourth quarter of 2019 included:

  • Achieved quarterly net income of $65.8 million, or $0.63 per diluted common share.
  • Earnings were positively impacted by a pre-tax MSR valuation adjustment of $3.2 million, while merger-related expenses totaling $5.8 million adversely impacted earnings for the quarter.
  • Achieved net operating income – excluding MSR – of $67.8 million, or $0.65 per diluted common share, which represents an increase of 14.0 percent on a per share basis compared with the fourth quarter of 2018.
  • Generated organic total deposit growth for the quarter of approximately $385 million, or 9.5 percent on an annualized basis.
  • Continued strong credit quality reflected by net recoveries of $2.2 million and no recorded provision for credit losses for the quarter; non-performing and classified asset levels remained stable.
  • Repurchased 293,357 shares of outstanding common stock at a weighted average price of $32.46 per share.
  • Enhanced capital structure through underwritten public offerings of $300 million of the Company's 4.125 percent Fixed-to-Floating Rate Subordinated Notes and $172.5 million of its 5.50 percent Series A Non-Cumulative Perpetual Preferred Stock.
  • Completed the acquisition of Texas First Bancshares, Inc., the parent company of Texas First State Bank, effective January 1, 2020, which will add over $185 million in loans and approximately $370 million in deposits to the Company's Central Texas presence in the first quarter of 2020.

The Company reported net income of $65.8 million, or $0.63 per diluted common share, for the fourth quarter of 2019, compared with net income of $47.1 million, or $0.47 per diluted common share, for the fourth quarter of 2018 and net income of $63.8 million, or $0.63 per diluted common share, for the third quarter of 2019.  The Company reported net operating income – excluding MSR – of $67.8 million, or $0.65 per diluted common share, for the fourth quarter of 2019, compared with $56.4 million, or $0.57 per diluted common share, for the fourth quarter of 2018 and $69.7 million, or $0.69 per diluted common share, for the third quarter of 2019. 

Additionally, the Company reported net income of $234.3 million, or $2.30 per diluted common share, for the year ended December 31, 2019 compared with $221.3 million, or $2.23 per diluted common share, for the year ended December 31, 2018.  The Company reported net operating income – excluding MSR – of $255.4 million, or $2.51 per diluted common share, for the year ended December 31, 2019 compared with $220.7 million, or $2.23 per diluted common share, for the year ended December 31, 2018. 

Net operating income – excluding MSR – is a non-GAAP financial measure used by management to assess the core operating performance of the Company.  This measure excludes items such as recognized securities gains and losses, MSR valuation adjustments, restructuring charges, merger-related expenses, and certain other charges. 

At its regular quarterly meeting today, the Board of Directors of the Company declared quarterly cash dividends of $0.185 per share of common stock and $0.34375 per share of Series A Preferred Stock.  The common stock dividend is payable on April 1, 2020 to shareholders of record at the close of business on March 13, 2020.  The preferred stock dividend is payable on February 20, 2020 to shareholders of record at the close of business on February 5, 2020.

"We are pleased to report record financial results for 2019," remarked Dan Rollins, Chairman and Chief Executive Officer.  "First and foremost, we are excited to pass the $20 billion mark in total assets.  This achievement is a tremendous milestone for our Company and a testament to the hard work and success of our teammates in growing our Company both organically and through acquisitions.  We also reported record annual income, both on a GAAP basis and an operating basis.  Our net operating income – excluding MSR – of $255.4 million, or $2.51 per diluted common share, represented an increase of over 12 percent compared to 2018.   While the net interest margin has been under recent pressure primarily as a result of a shift in earning asset mix, we were able to improve our net interest margin – excluding accretable yield from 3.64 percent for 2018 to 3.72 percent for 2019.  The earnings asset mix shift was attributable primarily to our ability to grow deposits approximately $1.0 billion, or 7 percent, organically while loans were essentially flat for the year on an organic basis.  Finally, our ability to maintain strong credit quality and improve our efficiency has been instrumental in our success." 

"As we look at our fourth quarter results, the highlights are much the same.  We reported net operating income – excluding MSR – of $67.8 million, or $0.65 per diluted common share, which represents an increase of 14.0 percent compared to the fourth quarter of 2018.  We had another great quarter of organic deposit growth, which totaled $385 million, or 9.5 percent annualized.  We were also active in the capital markets during the quarter, raising $300 million from the offering of subordinated debt and $172.5 million from the offering of preferred stock.  These transactions allowed us to take advantage of historically low interest rates and improve our capital structure.  As we move into 2020, efficiently managing and deploying this additional capital will be of utmost importance."

Net Interest Revenue

Net interest revenue was $170.8 million for the fourth quarter of 2019, an increase of 11.7 percent from $152.9 million for the fourth quarter of 2018 and an increase of 2.5 percent from $166.6 million for the third quarter of 2019.  The fully taxable equivalent net interest margin was 3.76 percent for the fourth quarter of 2019, compared with 3.80 percent for the fourth quarter of 2018 and 3.88 percent for the third quarter of 2019.  Yields on net loans and leases were 5.13 percent for the fourth quarter of 2019, compared with 4.94 percent for the fourth quarter of 2018 and 5.16 percent for the third quarter of 2019, while yields on total interest earning assets were 4.48 percent for the fourth quarter of 2019, compared with 4.45 percent for the fourth quarter of 2018 and 4.63 percent for the third quarter of 2019.  The net interest margin, excluding accretable yield, was 3.61 percent for the fourth quarter of 2019, compared with 3.71 percent for the fourth quarter of 2018 and 3.76 percent for the third quarter of 2019, while yields on net loans and leases, excluding accretable yield, were 4.95 percent for the fourth quarter of 2019, compared with 4.83 percent for the fourth quarter of 2018 and 5.02 percent for the third quarter of 2019.  The average cost of deposits was 0.68 percent for the fourth quarter of 2019, compared with 0.52 percent for the fourth quarter of 2018 and 0.71 percent for the third quarter of 2019.

Balance Sheet Activity

Loans and leases, net of unearned income, decreased $31.1 million during the fourth quarter of 2019 and have increased $1.0 billion since December 31, 2018.  Excluding acquired balances, loans were essentially flat for both the fourth quarter and the full year 2019.  Deposits increased $384.9 million during the fourth quarter of 2019 and deposits have increased $2.3 billion since December 31, 2018.  Excluding acquired deposits, total deposits increased approximately $1.0 billion, or 7.2 percent, during 2019.

Provision for Credit Losses and Allowance for Credit Losses

Earnings for the fourth quarter of 2019 reflect no provision for credit losses, compared with a provision of $1.0 million for the fourth quarter of 2018 and $0.5 million for the third quarter of 2019.  Net recoveries for the fourth quarter of 2019 were $2.2 million, compared with net charge-offs of $1.9 million for the fourth quarter of 2018 and net recoveries of $0.7 million for the third quarter of 2019.  The allowance for credit losses was $119.1 million, or 0.85 percent of net loans and leases, at December 31, 2019, compared with $120.1 million, or 0.92 percent of net loans and leases, at December 31, 2018, and $116.9 million, or 0.83 percent of net loans and leases, at September 30, 2019.  The allowance for credit losses coverage metrics were impacted by loans acquired in the acquisitions that closed during the second quarter of 2019 and the third quarter of 2019.

Total non-performing assets were $118.3 million, or 0.84 percent of net loans and leases, at December 31, 2019, compared with $106.0 million, or 0.81 percent of net loans and leases, at December 31, 2018, and $116.0 million, or 0.82 percent of net loans and leases, at September 30, 2019.  Other real estate owned was $6.7 million at December 31, 2019, compared with $9.3 million at December 31, 2018 and $7.9 million at September 30, 2019.

Noninterest Revenue

Noninterest revenue was $74.7 million for the fourth quarter of 2019, compared with $59.0 million for the fourth quarter of 2018 and $75.4 million for the third quarter of 2019.  These results include a positive MSR valuation adjustment of $3.2 million for the fourth quarter of 2019, compared with a negative MSR valuation adjustment of $8.1 million for the fourth quarter of 2018 and a negative MSR valuation adjustment of $4.0 million for the third quarter of 2019.  Valuation adjustments in the MSR asset are driven primarily by fluctuations in interest rates period over period.   

Mortgage production and servicing revenue was $6.9 million for the fourth quarter of 2019, compared with $4.8 million for the fourth quarter of 2018 and $11.3 million for the third quarter of 2019.  Mortgage origination volume for the fourth quarter of 2019 was $504.9 million, compared with $305.0 million for the fourth quarter of 2018 and $536.1 million for the third quarter of 2019.  Of the total mortgage origination volume for the fourth quarter of 2019, $106.4 million was portfolio loans, compared with $47.3 million for the fourth quarter of 2018 and $112.1 million for the third quarter of 2019.

Credit card, debit card, and merchant fee revenue was $9.8 million for the fourth quarter of 2019, compared with $9.9 million for the fourth quarter of 2018 and $9.8 million for the third quarter of 2019.  Deposit service charge revenue was $12.2 million for the fourth quarter of 2019, compared with $11.7 million for the fourth quarter of 2018 and $11.9 million for the third quarter of 2019.  Wealth management revenue was $6.6 million for the fourth quarter of 2019, compared with $5.5 million for the fourth quarter of 2018 and $6.7 million for the third quarter of 2019.  Other noninterest revenue was $8.3 million for the fourth quarter of 2019, compared with $7.0 million for the fourth quarter of 2018 and $8.1 million for the third quarter of 2019.  Insurance commission revenue was $27.7 million for the fourth quarter of 2019, compared with $28.0 million for the fourth quarter of 2018 and $31.5 million for the third quarter of 2019. 

Noninterest Expense

Noninterest expense for the fourth quarter of 2019 was $162.4 million, compared with $152.3 million for the fourth quarter of 2018 and $159.6 million for the third quarter of 2019.  Salaries and employee benefits expense was $97.1 million for the fourth quarter of 2019, compared with $92.0 million for the fourth quarter of 2018 and $101.2 million for the third quarter of 2019.  The decline in salaries and employee benefits expense was related to an accrual true-up of approximately $4.0 million as a result of the improved performance of employee benefit plans in 2019 compared to 2018.  Occupancy expense was $12.3 million for the fourth quarter of 2019, compared with $12.1 million for the fourth quarter of 2018 and $12.3 million for the third quarter of 2019.  Other noninterest expense was $46.0 million for the fourth quarter of 2019, compared with $42.5 million for the fourth quarter of 2018 and $39.4 million for the third quarter of 2019.  Additionally, merger-related expense for the fourth quarter of 2019 was $5.8 million, compared with merger-related expense of $4.5 million for the fourth quarter of 2018 and $4.1 million for the third quarter of 2019. 

Capital Management

The Company's ratio of shareholders' equity to assets was 12.75 percent at December 31, 2019, compared with 12.25 percent at December 31, 2018 and 12.54 percent at September 30, 2019.  The ratio of tangible common shareholders' equity to tangible assets was 8.09 percent at December 31, 2019, compared with 8.46 percent at December 31, 2018 and 8.47 percent at September 30, 2019.

During November 2019, the Company completed an underwritten public offering of $300.0 million aggregate principal amount of its 4.125 percent Fixed-to-Floating Rate Subordinated Notes due November 20, 2029 (the "Notes") and an underwritten public offering of $172.5 million  of its 5.50 percent Series A Non-Cumulative Perpetual Preferred Stock, par value $0.01 per share (the "Series A Preferred Stock"). For additional details regarding the terms of the Notes, including those related to interest rates and interest payment dates, redemption, seniority, and maturity, and the terms of the Series A Preferred Stock, including those related to dividends and dividend payment dates, redemption, seniority, and maturity, please refer to the offering circulars related to each offering that the Company filed with the Federal Deposit Insurance Corporation ("FDIC") on November 15, 2019.  The Company intends to use the net proceeds from the offerings for general corporate purposes, potentially including repurchases of shares of its common stock, future acquisitions and ongoing working capital needs. 

During the fourth quarter of 2019, the Company repurchased 293,357 shares of its outstanding common stock at a weighted average price of $32.46 per share pursuant to its share repurchase program, which is intended to comply with Rules 10b-18 and 10b5-1 promulgated under the Securities and Exchange Act of 1934, as amended (the "Exchange Act").  For the full year of 2019, the Company repurchased 2,466,438 shares of its outstanding common stock at a weighted average price of $28.20 per share.  On December 12, 2019, the Company announced that its Board of Directors authorized a new share repurchase program to purchase up to an aggregate of 8.0 million shares of the Company's common stock. This new share repurchase program became effective January 2, 2020 and will expire on December 31, 2020.

Estimated regulatory capital ratios at December 31, 2019 were calculated in accordance with the Basel III capital framework.  The Company is a "well capitalized" bank, as defined by federal regulations, at December 31, 2019, with Tier 1 risk-based capital of 11.60 percent and total risk-based capital of 14.17 percent, compared with required minimum levels of 8 percent and 10 percent, respectively, in order to qualify for "well capitalized" classification. 

Summary

Rollins concluded, "We are pleased with our accomplishments in 2019 and excited about what lies ahead in 2020.   We recently closed our previously announced merger with Texas First Bancshares, Inc.  We are excited to welcome Rodney Kroll and his team to our Company as we enter the Waco, Texas market and expand our presence in other surrounding markets.  As we venture into the new year, we will look for ways to continue to grow our Company, enhance our technology and customer experience, and ultimately deliver improved returns to our shareholders."

TRANSACTIONS

Texas First Bancshares, Inc.

On January 1, 2020, the Company completed the merger with Texas First Bancshares, Inc., the parent company of Texas First State Bank, (collectively referred to as "Texas First"), pursuant to which Texas First was merged with and into the Company.  Texas First operated 6 full-service banking offices in the Waco, Texas and Killeen-Temple, Texas metropolitan statistical areas ("MSA").  As of January 1, 2020, Texas First collectively reported total assets of $396.9 million, total loans of $185.7 million and total deposits of $369.3 million.  Under the terms of the definitive merger agreement, the Company issued approximately 1,040,000 shares of the Company's common stock plus $13.0 million in cash for all outstanding shares of Texas First.  For more information regarding this transaction, see our Current Report on Form 8-K that was filed with the FDIC on January 2, 2020.

Van Alstyne Financial Corporation & Summit Financial Enterprises, Inc.

On September 1, 2019, the Company completed the mergers with Van Alstyne Financial Corporation and its wholly owned subsidiary, Texas Star Bank (collectively referred to as "Texas Star"), pursuant to which Texas Star was merged with and into the Company, and with Summit Financial Enterprises, Inc. and its wholly owned subsidiary, Summit Bank (collectively referred to as "Summit"), pursuant to which Summit was merged with and into the Company.  Texas Star operated 7 full-service banking offices in Collin and Grayson counties in Texas, and one loan production office in Durant, Oklahoma, while Summit operated 4 offices located in Panama City, Panama City Beach, Fort Walton Beach, and Pensacola, Florida.  As of September 1, 2019, Texas Star and Summit collectively reported total assets of $805.2 million, total loans of $610.2 million and total deposits of $794.2 million.  Under the terms of the definitive merger agreements, the Company issued approximately 4,600,000 shares of the Company's common stock plus $48.2 million in cash for all outstanding shares of both institutions.  For more information regarding these transactions, see our Current Report on Form 8-K that was filed with the FDIC on September 3, 2019.  The purchase accounting for these transactions is considered provisional as management continues to identify and assess information regarding the nature of the acquired assets and liabilities and reviews the associated valuation assumptions and methodologies.

Casey Bancorp, Inc. & Merchants Trust, Inc.

On April 1, 2019, the Company completed the mergers with Casey Bancorp, Inc. and its wholly owned subsidiary, Grand Bank of Texas (collectively referred to as "Grand Bank"), pursuant to which Grand Bank was merged with and into the Company, and with Merchants Trust, Inc. and its wholly owned subsidiary, Merchants Bank (collectively referred to as "Merchants"), pursuant to which Merchants was merged with and into the Company.  Grand Bank operated 4 full-service banking offices in the cities of Dallas, Grand Prairie, Horseshoe Bay and Marble Falls, all in Texas, while Merchants, which was based in Jackson, Alabama, operated 6 full-service banking offices in Clarke and Mobile counties in Alabama.  As of April 1, 2019, Grand Bank and Merchants collectively reported total assets of $566.0 million, total loans of $415.0 million and total deposits of $529.0 million.  Under the terms of the definitive merger agreements, the Company issued approximately 2,225,000 shares of the Company's common stock plus $24.2 million in cash for all outstanding shares of both institutions.  For more information regarding these transactions, see our Current Report on Form 8-K that was filed with the FDIC on April 1, 2019.  The purchase accounting for these transactions is considered provisional as management continues to identify and assess information regarding the nature of the acquired assets and liabilities and reviews the associated valuation assumptions and methodologies.

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 22 of this news release.

Conference Call and Webcast

The Company will conduct a conference call to discuss its fourth quarter 2019 financial results on January 23, 2020, 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 $21 billion in assets.  BancorpSouth operates approximately 310 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: @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, 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 "may," "should," "could," "predict," "potential," "believe," "will likely result," "expect," "continue," "will," "anticipate," "seek," "aspire," "roadmap," "achieve," "estimate," "intend," "plan," "project," "projection," "forecast," "goal," "target," "would," and "outlook," or the negative version of those words or other comparable words of a future or forward-looking nature. These forward-looking statements include, without limitation, those relating to the benefits, costs, synergies and financial and operational impact of the Grand Bank, Merchants, Texas Star, Summit and Texas First mergers on the Company, the acceptance by customers of Grand Bank, Merchants, Texas Star, Summit and Texas First of the Company's products and services after the closing of the mergers, the opportunities to enhance market share in certain markets and market acceptance of the Company generally in new markets, the Company's ability to operate its regulatory compliance programs consistent with federal, state and local laws, including its Bank Secrecy Act ("BSA") and anti-money laundering ("AML") compliance program and its fair lending compliance program, the Company's compliance with the consent order it entered into with the Consumer Financial Protection Bureau and the United States Department of Justice related to the Company's fair lending practices (the "Consent Order"), the Company's ability to pay dividends or coupons on Series A Preferred Stock or the Notes or its ability to ultimately repay the Notes or otherwise comply with the terms of such instruments, amortization expense for intangible assets, goodwill impairments, loan impairments, utilization of appraisals and inspections for real estate loans, maturity, renewal or extension of construction, acquisition and development loans, net interest revenue, fair value determinations, the amount of the Company's non-performing loans and leases, credit quality, credit losses, liquidity, off-balance sheet commitments and arrangements, valuation of mortgage servicing rights, allowance and provision for credit losses, early identification and resolution of credit issues, utilization of non-GAAP financial measures, the ability of the Company to collect all amounts due according to the contractual terms of loan agreements, the Company's reserve for losses from representation and warranty obligations, the Company's foreclosure process related to mortgage loans, the resolution of non-performing loans that are collaterally dependent, real estate values, fully-indexed interest rates, interest rate risk, interest rate sensitivity, the impact of interest rates on loan yields, calculation of economic value of equity, impaired loan charge-offs, diversification of the Company's revenue stream, the growth of the Company's insurance business and commission revenue, the growth of the Company's customer base and loan, deposit and fee revenue sources, liquidity needs and strategies, the ability of the Company to access successfully the capital and credit markets when needed or as desired, sources of funding, net interest margin, declaration and payment of dividends, the utilization of the Company's share repurchase program, the implementation and execution of cost saving initiatives, improvement in the Company's efficiencies, operating expense trends, future acquisitions, dispositions and other strategic growth opportunities and initiatives, and the impact of certain claims and ongoing, pending or threatened litigation, administrative and investigatory matters.

These forward-looking statements are not historical facts, and are based upon current expectations, estimates and projections about the Company's industry, management's beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain, involve risk and are beyond the Company's control. The inclusion of these forward-looking statements should not be regarded as a representation by the Company or any other person that such expectations, estimates and projections will be achieved. Accordingly, the Company cautions that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions and uncertainties that are difficult to predict and that are beyond BancorpSouth's control. These risks, assumptions and uncertainties may include, but are not limited to, the Company's ability to operate its regulatory compliance programs consistent with federal, state and local laws, including its BSA/AML compliance program and its fair lending compliance program, the Company's ability to successfully implement and comply with the Consent Order, [the ability of the Company to meet expectations regarding the benefits, costs, synergies, and financial and operational impact of the Grand Bank, Merchants, Texas Star, Summit and Texas First mergers, the possibility that any of the anticipated benefits, costs, synergies and financial and operational improvements of the Grand Bank, Merchants, Texas Star, Summit and Texas First mergers will not be realized or will not be realized as expected, the ability of the Company and Texas First to meet expectations regarding the timing, completion and accounting and tax treatments of the Texas First merger, the possibility that any of the anticipated benefits of the Texas First merger will not be realized or will not be realized as expected, the effect of any announcements regarding the Texas First merger on the Company's operating results, the possibility that the Texas First merger may be more expensive to complete than anticipated, including as a result of unexpected factors or events, the lack of availability of the Company's filings mandated by the Exchange Act from the Securities and Exchange Commission's publicly available website after November 1, 2017, the impact of any ongoing pending or threatened litigation, administrative and investigatory matters involving the Company, conditions in the financial markets and economic conditions generally, the adequacy of the Company's provision and allowance for credit losses to cover actual credit losses, the credit risk associated with real estate construction, acquisition and development loans, limitations on the Company's ability to declare and pay dividends, the availability of capital on favorable terms if and when needed, liquidity risk, governmental regulation, including the Dodd-Frank Wall Street Reform and Consumer Protection Act, and supervision of the Company's operations, the short-term and long-term impact of changes to banking capital standards on the Company's regulatory capital and liquidity, the impact of regulations on service charges on the Company's core deposit accounts, the susceptibility of the Company's business to local economic and environmental conditions, the soundness of other financial institutions, changes in interest rates, the impact of monetary policies and economic factors on the Company's ability to attract deposits or make loans, volatility in capital and credit markets, reputational risk, the impact of the loss of any key Company personnel, the impact of hurricanes or other adverse weather events, any requirement that the Company write down goodwill or other intangible assets, diversification in the types of financial services the Company offers, the growth of the Company's insurance business and commission revenue, the growth of the Company's loan, deposit and fee revenue sources, the Company's ability to adapt its products and services to evolving industry standards and consumer preferences, competition with other financial services companies, risks in connection with completed or potential acquisitions, dispositions and other strategic growth opportunities and initiatives, the Company's growth strategy, interruptions or breaches in the Company's information system security, the failure of certain third-party vendors to perform, unfavorable ratings by rating agencies, dilution caused by the Company's issuance of any additional shares of its capital stock to raise capital or acquire other banks, bank holding companies, financial holding companies and insurance agencies, the utilization of the Company's share repurchase program, the implementation and execution of cost saving initiatives, other factors generally understood to affect the assets, business, cash flows, financial condition, liquidity, prospects and/or results of operations of financial services companies, and other factors detailed from time to time in the Company's press and news releases, reports and other filings with the Federal Deposit Insurance Corporation.

Although the Company believes that the expectations reflected in these forward-looking statements are reasonable as of the date of this news release, actual results may prove to be materially different from the results expressed or implied by the forward-looking statements. 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 differ materially from the Company's forward-looking statements. Accordingly, undue reliance should not be placed on any such forward-looking statements. Any forward-looking statement speaks 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 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.

 

BancorpSouth Bank

Selected Financial Information

(Dollars in thousands, except per share data)

(Unaudited)


















Quarter Ended

Quarter Ended

Quarter Ended

Quarter Ended

Quarter Ended

Year Ended

Year Ended


12/31/2019

9/30/2019

6/30/2019

3/31/2019

12/31/2018

12/31/2019

12/31/2018

Earnings Summary:








Interest revenue

$                    203,812

$                    199,004

$                    191,063

$                    181,133

$                    178,850

$            775,012

$            653,493

Interest expense

33,038

32,405

31,046

28,579

25,969

125,068

78,271

Net interest revenue

170,774

166,599

160,017

152,554

152,881

649,944

575,222

Provision for credit losses

-

500

500

500

1,000

1,500

4,500

Net interest revenue, after provision








   for credit losses

170,774

166,099

159,517

152,054

151,881

648,444

570,722

Noninterest revenue

74,697

75,432

66,332

64,220

59,031

280,681

282,037

Noninterest expense

162,351

159,614

157,674

149,968

152,342

629,607

587,634

Income before income taxes

83,120

81,917

68,175

66,306

58,570

299,518

265,125

Income tax expense

17,271

18,160

15,118

14,708

11,473

65,257

43,808

Net income

$                      65,849

$                      63,757

$                      53,057

$                      51,598

$                      47,097

$            234,261

$            221,317

Less: Preferred dividends

-

-

-

-

-

-

-

Net income available to common shareholders

$                      65,849

$                      63,757

$                      53,057

$                      51,598

$                      47,097

$            234,261

$            221,317









Balance Sheet - Period End Balances








Total assets

$               21,052,576

$               19,850,225

$               18,936,814

$               18,314,183

$               18,001,540

$       21,052,576

$       18,001,540

Total earning assets

18,891,021

17,619,053

16,948,009

16,426,872

16,144,098

18,891,021

16,144,098

Total securities

4,481,974

2,766,446

2,760,732

2,692,499

2,749,188

4,481,974

2,749,188

Loans and leases, net of unearned income

14,089,683

14,120,783

13,658,527

13,071,059

13,112,149

14,089,683

13,112,149

Allowance for credit losses

119,066

116,908

115,691

116,499

120,070

119,066

120,070

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

1,628,265

1,845,056

1,421,303

1,191,673

1,310,089

1,628,265

1,310,089

Remaining loan mark on acquired loans

46,240

53,137

38,408

30,782

37,366

46,240

37,366

Total deposits

16,410,699

16,025,756

15,136,648

14,692,609

14,069,966

16,410,699

14,069,966

Long-term debt

5,053

5,161

5,271

5,503

6,213

5,053

6,213

Junior subordinated debt securities

296,547

-

-

-

-

296,547

-

Total shareholders' equity

2,685,017

2,489,427

2,327,120

2,226,585

2,205,737

2,685,017

2,205,737

Common shareholders' equity

2,517,996

2,489,427

2,327,120

2,226,585

2,205,737

2,517,996

2,205,737









Balance Sheet - Average Balances








Total assets

$               20,243,023

$               19,170,926

$               18,637,258

$               18,033,513

$               17,879,081

$       19,027,644

$       17,240,092

Total earning assets

18,125,676

17,148,574

16,693,115

16,156,235

16,056,656

17,036,618

15,599,570

Total securities

3,555,014

2,738,691

2,733,335

2,704,383

2,784,437

2,934,654

2,867,439

Loans and leases, net of unearned income

14,061,118

13,726,755

13,549,591

13,078,221

13,063,422

13,606,951

12,481,534

Total deposits

16,218,715

15,509,511

15,080,885

14,445,834

14,072,416

15,319,130

13,641,476

Long-term debt

5,138

5,303

5,403

5,826

17,403

5,415

29,508

Junior subordinated debt securities

135,535

-

-

-

-

34,162

3,169

Total shareholders' equity

2,572,750

2,378,882

2,298,512

2,212,748

2,191,852

2,366,745

2,086,922

Common shareholders' equity

2,498,033

2,378,882

2,298,512

2,212,748

2,191,852

2,347,913

2,086,922









Nonperforming Assets:








Non-accrual loans and leases

$                      78,796

$                      76,383

$                      71,076

$                      68,949

$                      70,555

$              78,796

$              70,555

Loans and leases 90+ days past due, still accruing

17,531

16,659

8,053

8,471

18,695

17,531

18,695

Restructured loans and leases, still accruing

15,184

15,033

10,676

9,874

7,498

15,184

7,498

Non-performing loans (NPLs)

111,511

108,075

89,805

87,294

96,748

111,511

96,748

Other real estate owned

6,746

7,929

6,179

9,686

9,276

6,746

9,276

Non-performing assets (NPAs)

$                    118,257

$                    116,004

$                      95,984

$                      96,980

$                    106,024

$            118,257

$            106,024









Financial Ratios and Other Data:








Return on average assets

1.29%

1.32%

1.14%

1.16%

1.05%

1.23%

1.28%

Operating return on average assets-excluding MSR*

1.33%

1.44%

1.33%

1.26%

1.25%

1.34%

1.28%

Return on average shareholders' equity

10.15%

10.63%

9.26%

9.46%

8.52%

9.90%

10.60%

Operating return on average shareholders' equity-excluding MSR*

10.46%

11.63%

10.82%

10.24%

10.20%

10.79%

10.57%

Return on average common shareholders' equity

10.46%

10.63%

9.26%

9.46%

8.52%

9.98%

10.60%

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

10.78%

11.63%

10.82%

10.24%

10.20%

10.88%

10.57%

Return on average tangible equity*

15.47%

16.23%

14.06%

14.27%

12.66%

15.04%

15.22%

Operating return on average tangible equity-excluding MSR*

15.94%

17.75%

16.42%

15.45%

15.15%

16.40%

15.95%

Return on average tangible common equity*

16.19%

16.23%

14.06%

14.27%

12.66%

15.22%

15.22%

Operating return on average tangible common equity-excluding MSR*

16.68%

17.75%

16.42%

15.45%

15.15%

16.60%

15.95%

Noninterest income to average assets

1.46%

1.56%

1.43%

1.44%

1.31%

1.48%

1.64%

Noninterest expense to average assets

3.18%

3.30%

3.39%

3.37%

3.38%

3.31%

3.41%

Net interest margin-fully taxable equivalent

3.76%

3.88%

3.87%

3.86%

3.80%

3.84%

3.72%

Net interest margin-fully taxable equivalent, excluding net accretion








  on acquired loans and leases

3.61%

3.76%

3.79%

3.74%

3.71%

3.72%

3.64%

Net interest rate spread

3.44%

3.56%

3.56%

3.56%

3.53%

3.53%

3.50%

Efficiency ratio (tax equivalent)*

65.92%

65.68%

69.36%

68.85%

71.52%

67.38%

68.22%

Operating efficiency ratio-excluding MSR (tax equivalent)*

64.39%

63.01%

65.46%

66.89%

66.86%

64.90%

66.62%

Loan/deposit ratio

85.86%

88.11%

90.23%

88.96%

93.19%

85.86%

93.19%

Price to earnings multiple (close)

13.60

13.77

13.26

16.60

11.67

13.60

11.67

Market value to common book value

130.38%

124.62%

125.60%

125.56%

118.27%

130.38%

118.27%

Market value to common book value (avg)

128.18%

120.12%

125.47%

132.05%

131.34%

122.58%

146.37%

Market value to common tangible book value

201.13%

193.15%

191.45%

189.14%

178.79%

201.13%

178.79%

Market value to common tangible book value (avg)

197.74%

186.17%

191.25%

198.92%

198.55%

189.09%

221.26%

Employee FTE

4,693

4,674

4,581

4,370

4,445

4,693

4,445









*Denotes non-GAAP financial measure.  Refer to related disclosure and reconciliation on pages 22 and 23.






 

 

BancorpSouth Bank

Selected Financial Information

(Dollars in thousands, except per share data)

(Unaudited)


















Quarter Ended

Quarter Ended

Quarter Ended

Quarter Ended

Quarter Ended

Year Ended

Year Ended


12/31/2019

9/30/2019

6/30/2019

3/31/2019

12/31/2018

12/31/2019

12/31/2018

Credit Quality Ratios:








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

(0.06%)

(0.02%)

0.04%

0.12%

0.06%

0.02%

0.02%

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

0.00%

0.01%

0.01%

0.02%

0.03%

0.01%

0.04%

Allowance for credit losses to net loans and leases

0.85%

0.83%

0.85%

0.89%

0.92%

0.85%

0.92%

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

0.96%

0.95%

0.95%

0.98%

1.02%

0.96%

1.02%

Allowance for credit losses to non-performing loans and leases

106.78%

108.17%

128.83%

133.46%

124.11%

106.78%

124.11%

Allowance for credit losses to non-performing assets

100.68%

100.78%

120.53%

120.13%

113.25%

100.68%

113.25%

Non-performing loans and leases to net loans and leases

0.79%

0.77%

0.66%

0.67%

0.74%

0.79%

0.74%

Non-performing assets to net loans and leases

0.84%

0.82%

0.70%

0.74%

0.81%

0.84%

0.81%









Equity Ratios:








Total shareholders' equity to total assets

12.75%

12.54%

12.29%

12.16%

12.25%

12.75%

12.25%

Total common shareholders' equity to total assets

11.96%

12.54%

12.29%

12.16%

12.25%

11.96%

12.25%

Tangible shareholders' equity to tangible assets*

8.92%

8.47%

8.42%

8.41%

8.46%

8.92%

8.46%

Tangible common shareholders' equity to tangible assets*

8.09%

8.47%

8.42%

8.41%

8.46%

8.09%

8.46%

















Capital Adequacy:








Common  Equity Tier 1 capital

10.57%

10.54%

10.52%

10.75%

10.84%

10.57%

10.84%

Tier 1 capital

11.60%

10.54%

10.52%

10.75%

10.84%

11.60%

10.84%

Total capital

14.17%

11.28%

11.28%

11.55%

11.68%

14.17%

11.68%

Tier 1 leverage capital

9.69%

9.14%

8.96%

9.03%

9.06%

9.69%

9.06%

   Estimated for current quarter
















Common Share Data:








Basic earnings per share

$                          0.63

$                          0.63

$                          0.53

$                          0.52

$                          0.47

2.31

$                  2.24

Diluted earnings per share

0.63

0.63

0.53

0.52

0.47

2.30

2.23

Operating earnings per share*

0.67

0.66

0.55

0.52

0.51

2.40

2.22

Operating earnings per share- excluding MSR*

0.65

0.69

0.61

0.56

0.57

2.51

2.23

Cash dividends per share

0.19

0.19

0.17

0.17

0.17

0.71

0.62

Book value per share

24.09

23.76

23.12

22.48

22.10

24.09

22.10

Tangible book value per share*

15.62

15.33

15.17

14.92

14.62

15.62

14.62

Market value per share (last)

31.41

29.61

29.04

28.22

26.14

31.41

26.14

Market value per share (high)

32.97

30.54

31.10

33.45

33.50

33.45

35.55

Market value per share (low)

28.13

26.47

26.92

25.76

24.31

25.76

24.31

Market value per share (avg)

30.88

28.54

29.01

29.68

29.03

29.53

32.35

Dividend payout ratio

29.43%

29.36%

32.24%

32.78%

35.93%

30.76%

27.72%

Total shares outstanding

104,522,804

104,775,876

100,651,798

99,066,856

99,797,271

104,522,804

99,797,271

Average shares outstanding - basic

104,739,906

101,168,730

100,610,746

99,506,952

99,541,965

101,506,583

98,965,115

Average shares outstanding - diluted

105,144,032

101,493,247

100,888,164

99,717,119

99,720,219

101,810,640

99,134,861

















Yield/Rate:








(Taxable equivalent basis)








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

5.13%

5.16%

5.12%

5.09%

4.94%

5.13%

4.73%

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








  net accretion on acquired loans and leases

4.95%

5.02%

5.02%

4.95%

4.83%

4.98%

4.64%

Available-for-sale securities:








  Taxable

2.00%

2.13%

2.10%

2.04%

1.92%

2.06%

1.80%

  Tax-exempt

4.69%

5.56%

4.53%

4.63%

4.47%

4.82%

4.39%

Short-term, FHLB and other equity investments

1.95%

2.41%

2.52%

2.67%

2.84%

2.37%

2.00%

  Total interest earning assets and revenue

4.48%

4.63%

4.61%

4.57%

4.45%

4.57%

4.22%

Deposits

0.68%

0.71%

0.68%

0.63%

0.52%

0.68%

0.40%

  Demand - interest bearing

0.88%

0.94%

0.91%

0.85%

0.70%

0.89%

0.52%

  Savings

0.28%

0.28%

0.29%

0.30%

0.30%

0.29%

0.20%

  Other time

1.68%

1.67%

1.60%

1.46%

1.26%

1.61%

1.04%

Short-term borrowings

1.51%

1.90%

2.14%

2.16%

2.06%

1.93%

1.71%

Total interest bearing deposits and short-term borrowings

1.01%

1.07%

1.06%

1.01%

0.91%

1.03%

0.71%

Junior subordinated debt

4.17%

N/A

N/A

N/A

N/A

4.17%

N/A

Long-term debt

4.83%

4.93%

4.87%

4.88%

4.12%

4.88%

4.11%

  Total interest bearing liabilities and expense

1.04%

1.07%

1.06%

1.01%

0.92%

1.04%

0.72%

Interest bearing liabilities to interest earning assets

69.37%

70.15%

70.47%

71.15%

69.79%

70.25%

70.01%

Net interest tax equivalent adjustment

$                           800

$                           972

$                           974

$                        1,035

$                        1,088

$                3,782

$                4,390









*Denotes non-GAAP financial measure.  Refer to related disclosure and reconciliation on pages 22 and 23.






 

 








BancorpSouth Bank

Consolidated Balance Sheets

(Unaudited)









Dec-19

Sep-19

Jun-19

Mar-19

Dec-18



(Dollars in thousands)


Assets







Cash and due from banks

$                261,773

$                333,108

$                212,080

$                207,486

$                239,960


Interest bearing deposits with other banks







and Federal funds sold

71,233

466,650

314,172

490,667

92,476


Available-for-sale securities, at fair value

4,481,974

2,766,446

2,760,732

2,692,499

2,749,188


Loans and leases

14,107,743

14,137,563

13,674,990

13,086,801

13,129,012


  Less:  Unearned income

18,060

16,780

16,463

15,742

16,863


             Allowance for credit losses

119,066

116,908

115,691

116,499

120,070


Net loans and leases

13,970,617

14,003,875

13,542,836

12,954,560

12,992,079


Loans held for sale

210,361

229,514

175,898

138,379

140,300


Premises and equipment, net

480,901

480,819

447,564

432,540

361,859


Accrued interest receivable

65,173

62,818

60,598

59,038

57,054


Goodwill

825,679

822,093

734,473

699,073

695,720


Other identifiable intangibles

60,008

61,100

65,930

49,396

50,896


Bank owned life insurance

326,417

328,670

315,398

305,315

308,324


Other real estate owned

6,746

7,929

6,179

9,686

9,276


Other assets

291,694

287,203

300,954

275,544

304,408


Total Assets

$           21,052,576

$           19,850,225

$           18,936,814

$           18,314,183

$           18,001,540


Liabilities







Deposits:







  Demand:  Noninterest bearing

$             4,661,821

$             4,770,907

$             4,329,172

$             4,201,695

$             4,124,744


                  Interest bearing

7,176,934

6,745,329

6,511,332

6,353,731

5,898,851


  Savings

1,937,985

1,898,813

1,861,247

1,855,024

1,836,167


  Other time

2,633,959

2,610,707

2,434,897

2,282,159

2,210,204


Total deposits

16,410,699

16,025,756

15,136,648

14,692,609

14,069,966


Securities sold under agreement to repurchase

513,422

529,788

439,541

481,567

416,008


Federal funds purchased







   and other short-term borrowing

725,000

480,000

730,000

630,000

1,095,000


Accrued interest payable

15,124

13,120

12,225

9,718

8,543


Junior subordinated debt securities

296,547

-

-

-

-


Long-term debt

5,053

5,161

5,271

5,503

6,213


Other liabilities

401,714

306,973

286,009

268,201

200,073


Total Liabilities

18,367,559

17,360,798

16,609,694

16,087,598

15,795,803


Shareholders' Equity







Preferred stock

167,021

-

-

-

-


Common stock

261,307

261,940

251,629

247,667

249,493


Capital surplus

605,976

611,115

506,201

462,256

484,482


Accumulated other comprehensive loss

(62,663)

(50,538)

(53,252)

(69,924)

(80,491)


Retained earnings

1,713,376

1,666,910

1,622,542

1,586,586

1,552,253


Total Shareholders' Equity

2,685,017

2,489,427

2,327,120

2,226,585

2,205,737


Total Liabilities & Shareholders' Equity

$           21,052,576

$           19,850,225

$           18,936,814

$           18,314,183

$           18,001,540


 

 








BancorpSouth Bank

Consolidated Average Balance Sheets

(Unaudited)









Dec-19

Sep-19

Jun-19

Mar-19

Dec-18



(Dollars in thousands)


Assets







Cash and due from banks

$                244,444

$                229,814

$                202,564

$                213,415

$                218,553


Interest bearing deposits with other banks







and Federal funds sold

300,495

486,716

254,951

238,194

62,516


Available-for-sale securities, at fair value

3,555,014

2,738,691

2,733,335

2,704,383

2,784,437


Loans and leases

14,078,793

13,743,876

13,565,632

13,094,817

13,079,321


  Less:  Unearned income

17,675

17,121

16,041

16,596

15,899


             Allowance for credit losses

117,668

116,232

116,339

118,352

120,426


Net loans and leases

13,943,450

13,610,523

13,433,252

12,959,869

12,942,996


Loans held for sale

173,649

157,691

117,995

86,294

96,588


Premises and equipment, net

481,623

458,758

453,239

430,675

372,488


Accrued interest receivable

60,678

57,941

54,977

54,296

54,156


Goodwill

823,812

761,084

735,540

695,787

668,544


Other identifiable intangibles

60,559

59,253

49,058

50,115

47,567


Bank owned life insurance

328,567

319,894

313,550

306,134

305,888


Other real estate owned

7,820

6,908

7,313

9,555

15,048


Other assets

262,912

283,653

281,484

284,796

310,300


Total Assets

$           20,243,023

$           19,170,926

$           18,637,258

$           18,033,513

$           17,879,081


Liabilities







Deposits:







  Demand:  Noninterest bearing

$             4,803,104

$             4,479,698

$             4,307,570

$             4,078,027

$             4,284,521


                  Interest bearing

6,872,921

6,655,962

6,485,523

6,283,089

5,753,655


  Savings

1,913,650

1,869,045

1,872,552

1,837,197

1,836,148


  Other time

2,629,040

2,504,806

2,415,240

2,247,521

2,198,092


Total deposits

16,218,715

15,509,511

15,080,885

14,445,834

14,072,416


Securities sold under agreement to repurchase

530,217

507,558

484,950

457,875

447,727


Federal funds purchased







   and other short-term borrowing

487,272

487,456

499,385

664,056

953,137


Accrued interest payable

14,942

13,756

12,239

9,998

8,305


Junior subordinated debt securities

135,535

-

-

-

-


Long-term debt

5,138

5,303

5,403

5,826

17,403


Other liabilities

278,454

268,460

255,884

237,176

188,241


Total Liabilities

17,670,273

16,792,044

16,338,746

15,820,765

15,687,229


Shareholders' Equity







Preferred stock

74,717

-

-

-

-


Common stock

261,905

254,881

252,351

248,810

250,752


Capital surplus

611,667

538,665

511,786

475,390

497,330


Accumulated other comprehensive loss

(53,111)

(52,204)

(66,048)

(78,255)

(91,541)


Retained earnings

1,677,572

1,637,540

1,600,423

1,566,803

1,535,311


Total Shareholders' Equity

2,572,750

2,378,882

2,298,512

2,212,748

2,191,852


Total Liabilities & Shareholders' Equity

$           20,243,023

$           19,170,926

$           18,637,258

$           18,033,513

$           17,879,081


 

 

BancorpSouth Bank

Consolidated Condensed Statements of Income

(Dollars in thousands, except per share data)

(Unaudited)
















Quarter Ended


Year to Date


Dec-19


Sep-19


Jun-19


Mar-19


Dec-18


Dec-19


Dec-18

INTEREST REVENUE:














Loans and leases

$      182,269


$     178,729


$        172,748


$      163,679


$     162,237


$    697,425


$    589,238

Deposits with other banks

1,225


2,456


1,292


1,516


457


6,489


1,695

Federal funds sold, securities purchased














   under agreement to resell, FHLB and 














      other equity investments

426


735


542


374


344


2,077


1,056

Available-for-sale securities:














    Taxable

17,241


13,759


13,223


12,437


12,208


56,660


46,604

    Tax-exempt

1,266


1,883


1,890


2,121


2,308


7,160


9,641

Loans held for sale

1,385


1,442


1,368


1,006


1,296


5,201


5,259

        Total interest revenue

203,812


199,004


191,063


181,133


178,850


775,012


653,493















INTEREST EXPENSE:














Interest bearing demand

15,202


15,689


14,741


13,139


10,191


58,771


29,657

Savings

1,334


1,341


1,348


1,338


1,367


5,361


3,705

Other time

11,134


10,546


9,635


8,065


6,967


39,380


21,685

Federal funds purchased and securities sold














   under agreement to repurchase

1,591


1,857


1,972


1,775


2,563


7,195


7,873

Short-term and long-term debt

2,293


2,971


3,349


4,262


4,880


12,875


15,348

Junior subordinated debt

1,482


-


-


-


-


1,482


-

Other

2


1


1


-


1


4


3

        Total interest expense

33,038


32,405


31,046


28,579


25,969


125,068


78,271















        Net interest revenue

170,774


166,599


160,017


152,554


152,881


649,944


575,222

  Provision for credit losses

-


500


500


500


1,000


1,500


4,500

        Net interest revenue, after provision for














          credit losses

170,774


166,099


159,517


152,054


151,881


648,444


570,722















NONINTEREST REVENUE:














Mortgage banking

10,102


7,289


351


2,040


(3,275)


19,782


23,411

Credit card, debit card and merchant fees

9,836


9,778


10,168


8,874


9,941


38,656


39,892

Deposit service charges

12,193


11,939


11,117


10,766


11,699


46,015


44,645

Security gains(losses), net

(41)


117


59


39


162


174


133

Insurance commissions

27,648


31,512


33,951


30,180


27,981


123,291


121,781

Wealth management

6,617


6,651


5,906


5,635


5,534


24,809


22,992

Other

8,342


8,146


4,780


6,686


6,989


27,954


29,183

        Total noninterest revenue

74,697


75,432


66,332


64,220


59,031


280,681


282,037















NONINTEREST EXPENSE:














Salaries and employee benefits

97,137


101,154


100,981


97,228


92,013


396,500


364,307

Occupancy, net of rental income

12,267


12,323


11,988


11,551


12,107


48,129


45,704

Equipment

4,725


4,676


4,423


3,888


3,837


17,712


15,389

Deposit insurance assessments

2,200


2,038


2,165


2,740


1,866


9,143


10,309

Other

46,022


39,423


38,117


34,561


42,519


158,123


151,925

        Total noninterest expense

162,351


159,614


157,674


149,968


152,342


629,607


587,634

        Income before income taxes

83,120


81,917


68,175


66,306


58,570


299,518


265,125

Income tax expense

17,271


18,160


15,118


14,708


11,473


65,257


43,808

        Net income

$        65,849


$       63,757


$          53,057


$        51,598


$       47,097


$    234,261


$    221,317

Less: Preferred dividends

-


-


-


-


-


-


-

        Net income available to common shareholders

$        65,849


$       63,757


$          53,057


$        51,598


$       47,097


$    234,261


$    221,317















Net income per common share: Basic

$            0.63


$           0.63


$              0.53


$            0.52


$           0.47


$          2.31


$          2.24

                                                   Diluted

$            0.63


$           0.63


$              0.53


$            0.52


$           0.47


$          2.30


$          2.23

 

 

BancorpSouth Bank

Selected Loan Data

(Dollars in thousands)

(Unaudited)












Quarter Ended


Dec-19


Sep-19


Jun-19


Mar-19


Dec-18

LOAN AND LEASE PORTFOLIO:










Commercial and industrial










   Commercial and industrial-non real estate

1,979,507


1,887,817


1,832,016


1,728,897


$    1,766,515

   Commercial and industrial-owner occupied

2,268,813


2,276,338


2,157,292


2,128,763


2,267,902

      Total commercial and industrial

4,248,320


4,164,155


3,989,308


3,857,660


4,034,417

Commercial real estate










   Agricultural

337,349


347,866


332,902


309,931


318,038

   Construction, acquisition and development

1,577,342


1,538,073


1,441,269


1,322,671


1,286,786

   Commercial real estate

3,220,914


3,345,166


3,287,453


3,169,117


3,026,214

      Total commercial real estate

5,135,605


5,231,105


5,061,624


4,801,719


4,631,038

Consumer










   Consumer mortgages

3,543,075


3,519,449


3,422,661


3,242,769


3,259,390

   Home equity

683,515


678,294


670,352


663,120


663,572

   Credit cards

102,559


101,213


101,024


99,260


105,569

      Total consumer

4,329,149


4,298,956


4,194,037


4,005,149


4,028,531

All other

376,609


426,567


413,558


406,531


418,163

      Total loans

$  14,089,683


$  14,120,783


$  13,658,527


$  13,071,059


$  13,112,149











ALLOWANCE FOR CREDIT LOSSES:










Balance, beginning of period

$      116,908


$      115,691


$      116,499


$       120,070


$      121,019











Loans and leases charged-off:










Commercial and industrial










   Commercial and industrial-non real estate

(1,273)


(218)


(866)


(819)


(1,042)

   Commercial and industrial-owner occupied

(192)


(65)


-


-


(237)

     Total commercial and industrial

(1,465)


(283)


(866)


(819)


(1,279)

Commercial real estate










   Agricultural

(11)


-


-


-


(6)

   Construction, acquisition and development

(26)


-


(45)


-


(142)

   Commercial real estate

-


(49)


(250)


(3,815)


(594)

     Total commercial real estate

(37)


(49)


(295)


(3,815)


(742)

Consumer










   Consumer mortgages

(687)


(255)


(237)


(185)


(298)

   Home equity

(173)


(39)


(124)


(353)


(237)

   Credit cards

(797)


(631)


(922)


(955)


(816)

     Total consumer

(1,657)


(925)


(1,283)


(1,493)


(1,351)

All other

(965)


(895)


(912)


(831)


(761)

     Total loans charged-off

(4,124)


(2,152)


(3,356)


(6,958)


(4,133)











Recoveries:










Commercial and industrial










   Commercial and industrial-non real estate

353


835


747


360


504

   Commercial and industrial-owner occupied

30


49


71


100


40

     Total commercial and industrial

383


884


818


460


544

Commercial real estate










   Agricultural

4


3


10


4


304

   Construction, acquisition and development

584


480


63


714


197

   Commercial real estate

4,212


29


218


78


139

     Total commercial real estate

4,800


512


291


796


640

Consumer










   Consumer mortgages

407


278


244


1,081


419

   Home equity

216


731


179


75


86

   Credit cards

218


224


223


218


245

     Total consumer

841


1,233


646


1,374


750

All other

258


240


293


257


250

     Total recoveries

6,282


2,869


2,048


2,887


2,184











Net recoveries(charge-offs) 

2,158


717


(1,308)


(4,071)


(1,949)











Provision charged to operating expense

-


500


500


500


1,000

Balance, end of period

$      119,066


$      116,908


$      115,691


$       116,499


$      120,070











Average loans for period

$ 14,061,118


$ 13,726,755


$ 13,549,591


$ 13,078,221


$ 13,063,422











Ratio:










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

(0.06%)


(0.02%)


0.04%


0.12%


0.06%

 

 

BancorpSouth Bank

Selected Loan Data

(Dollars in thousands)

(Unaudited)












Quarter Ended


Dec-19


Sep-19


Jun-19


Mar-19


Dec-18

NON-PERFORMING ASSETS










NON-PERFORMING LOANS AND LEASES:










  Nonaccrual Loans and Leases










    Commercial and industrial










       Commercial and industrial-non real estate

$    11,105


$       10,430


$         9,456


$    10,431


$       10,537

       Commercial and industrial-owner occupied

7,838


7,446


8,648


8,782


8,637

         Total commercial and industrial

18,943


17,876


18,104


19,213


19,174

    Commercial real estate










       Agricultural

4,772


4,423


6,115


6,263


4,617

       Construction, acquisition and development

6,225


2,231


2,071


2,710


3,124

       Commercial real estate

16,199


16,823


13,064


12,283


16,590

         Total commercial real estate

27,196


23,477


21,250


21,256


24,331

    Consumer










       Consumer mortgages

28,879


31,744


28,779


25,680


23,932

       Home equity

2,993


2,767


2,432


2,259


2,686

       Credit cards

63


85


86


160


173

         Total consumer

31,935


34,596


31,297


28,099


26,791

    All other

722


434


425


381


259

         Total nonaccrual loans and leases

$    78,796


$       76,383


$       71,076


$    68,949


$       70,555











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

17,531


16,659


8,053


8,471


18,695

  Restructured Loans and Leases, Still Accruing

15,184


15,033


10,676


9,874


7,498

     Total non-performing loans and leases

$  111,511


$      108,075


$       89,805


$    87,294


$       96,748











OTHER REAL ESTATE OWNED:

6,746


7,929


6,179


9,686


9,276











Total Non-performing Assets

$  118,257


$      116,004


$       95,984


$    96,980


$      106,024











  BXS originated assets

$    78,295


$       84,413


$       76,816


$    77,110


$       72,527

  Acquired assets

39,962


31,591


19,168


19,870


33,497

Total Non-performing Assets

$  118,257


$      116,004


$       95,984


$    96,980


$      106,024











Additions to Nonaccrual Loans and Leases During the Quarter

$    25,147


$       26,331


$       22,002


$    15,419


$       28,572











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










    BXS originated loans

$    44,559


$       40,668


$       42,968


$    34,591


$       43,922

    Acquired loans

23,054


16,741


14,042


10,840


9,769

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

$    67,613


$       57,409


$       57,010


$    45,431


$       53,691











Credit Quality Ratios:










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

0.00%


0.01%


0.01%


0.02%


0.03%

Allowance for credit losses to net loans and leases

0.85%


0.83%


0.85%


0.89%


0.92%

Allowance for credit losses to non-performing loans and leases

106.78%


108.17%


128.83%


133.46%


124.11%

Allowance for credit losses to non-performing assets

100.68%


100.78%


120.53%


120.13%


113.25%

Non-performing loans and leases to net loans and leases

0.79%


0.77%


0.66%


0.67%


0.74%

Non-performing assets to net loans and leases

0.84%


0.82%


0.70%


0.74%


0.81%

 

BancorpSouth Bank

Selected Loan Data

(Dollars in thousands)

(Unaudited)












December 31, 2019



Special





Purchased




Pass

Mention

Substandard

Doubtful

Loss

Impaired

Credit Impaired


Total

LOAN PORTFOLIO BY INTERNALLY ASSIGNED GRADE:










Commercial and industrial










   Commercial and industrial-non real estate

$   1,914,055

$                -

$       56,035

$        194

$                -

$    1,054

$          8,169


$   1,979,507

   Commercial and industrial-owner occupied

2,214,870

-

44,077

-

-

4,296

5,570


2,268,813

     Total commercial and industrial

4,128,925

-

100,112

194

-

5,350

13,739


4,248,320

Commercial real estate










   Agricultural

326,983

-

8,200

-

-

757

1,409


337,349

   Construction, acquisition and development

1,554,291

-

11,759

-

-

5,457

5,835


1,577,342

   Commercial real estate

3,130,489

-

74,606

-

-

11,934

3,885


3,220,914

     Total commercial real estate

5,011,763

-

94,565

-

-

18,148

11,129


5,135,605

Consumer










   Consumer mortgages

3,455,307

-

86,373

-

-

596

799


3,543,075

   Home equity

675,642

-

7,873

-

-

-

-


683,515

   Credit cards

102,559

-

-

-

-

-

-


102,559

     Total consumer

4,233,508

-

94,246

-

-

596

799


4,329,149

All other

364,783

2,240

9,568

-

-

-

18


376,609

     Total loans

$ 13,738,979

$         2,240

$      298,491

$        194

$                -

$  24,094

$        25,685


$ 14,089,683











  BXS originated loans

$ 12,080,336

$              -

$      202,017

$        194

$                -

$  17,110

$              -


$ 12,299,657

  Acquired loans*

1,658,643

2,240

96,474

-

-

6,984

25,685


1,790,026

     Total Loans

$ 13,738,979

$         2,240

$      298,491

$        194

$                -

$  24,094

$        25,685


$ 14,089,683












September 30, 2019



Special





Purchased




Pass

Mention

Substandard

Doubtful

Loss

Impaired

Credit Impaired


Total

LOAN PORTFOLIO BY INTERNALLY ASSIGNED GRADE:










Commercial and industrial










   Commercial and industrial-non real estate

$   1,820,611

$            500

$       52,338

$        194

$                -

$    1,653

$        12,521


$   1,887,817

   Commercial and industrial-owner occupied

2,224,622

-

41,503

-

-

4,211

6,002


2,276,338

     Total commercial and industrial

4,045,233

500

93,841

194

-

5,864

18,523


4,164,155

Commercial real estate










   Agricultural

337,586

-

8,876

-

-

-

1,404


347,866

   Construction, acquisition and development

1,518,970

-

13,298

-

-

-

5,805


1,538,073

   Commercial real estate

3,256,932

-

70,072

-

-

14,244

3,918


3,345,166

     Total commercial real estate

5,113,488

-

92,246

-

-

14,244

11,127


5,231,105

Consumer










   Consumer mortgages

3,436,136

-

77,677

-

-

4,840

796


3,519,449

   Home equity

671,520

-

6,774

-

-

-

-


678,294

   Credit cards

101,213

-

-

-

-

-

-


101,213

     Total consumer

4,208,869

-

84,451

-

-

4,840

796


4,298,956

All other

414,994

2,030

9,521

-

-

-

22


426,567

     Total loans

$ 13,782,584

$         2,530

$      280,059

$        194

$                -

$  24,948

$        30,468


$ 14,120,783











  BXS originated loans

$ 11,901,311

$              -

$      192,133

$        194

$                -

$  24,379

$              -


$ 12,118,017

  Acquired loans*

1,881,273

2,530

87,926

-

-

569

30,468


2,002,766

     Total Loans

$ 13,782,584

$         2,530

$      280,059

$        194

$                -

$  24,948

$        30,468


$ 14,120,783











* Includes certain loans that are no longer included in acquired loans in the purchase accounting disclosures on page 19 as a result of a maturity, refinance, or other triggering event.


 

 

BancorpSouth Bank

Geographical Information

(Dollars in thousands)

(Unaudited)












December 31, 2019


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

$    187,413

$    166,612

$    286,662

$    484,697

$      72,087

$      94,013

$    671,902

$      16,121

$   1,979,507

   Commercial and industrial-owner occupied

281,496

192,232

264,664

628,581

60,540

152,978

688,322

-

2,268,813

     Total commercial and industrial

468,909

358,844

551,326

1,113,278

132,627

246,991

1,360,224

16,121

4,248,320

Commercial real estate










   Agricultural

33,078

72,005

28,369

70,455

6,672

12,321

114,354

95

337,349

   Construction, acquisition and development

175,862

65,186

76,151

329,486

20,620

117,061

792,976

-

1,577,342

   Commercial real estate

336,559

364,466

335,106

654,115

216,542

210,732

1,096,382

7,012

3,220,914

     Total commercial real estate

545,499

501,657

439,626

1,054,056

243,834

340,114

2,003,712

7,107

5,135,605

Consumer










   Consumer mortgages

570,223

345,258

348,855

856,314

95,571

322,045

913,246

91,563

3,543,075

   Home equity

109,625

49,778

91,307

244,346

17,588

139,404

31,452

15

683,515

   Credit cards

-

-

-

-

-

-

-

102,559

102,559

     Total consumer

679,848

395,036

440,162

1,100,660

113,159

461,449

944,698

194,137

4,329,149

All other

31,861

22,409

18,691

132,072

3,044

16,801

75,259

76,472

376,609

     Total loans

$ 1,726,117

$ 1,277,946

$ 1,449,805

$ 3,400,066

$    492,664

$ 1,065,355

$ 4,383,893

$    293,837

$ 14,089,683











Loan growth, excluding loans acquired during










    the quarter (annualized)

(5.83%)

(6.46%)

(11.12%)

(15.13%)

7.51%

(9.18%)

11.56%

159.92%

(0.87%)











NON-PERFORMING LOANS AND LEASES:










Commercial and industrial










   Commercial and industrial-non real estate

$          165

$       1,077

$       1,641

$       1,045

$          472

$          317

$       9,579

$          236

$       14,532

   Commercial and industrial-owner occupied

1,242

1,313

1,127

4,033

-

-

9,506

-

17,221

     Total commercial and industrial

1,407

2,390

2,768

5,078

472

317

19,085

236

31,753

Commercial real estate










   Agricultural

681

594

223

78

-

-

3,916

-

5,492

   Construction, acquisition and development

137

423

552

120

-

177

11,334

-

12,743

   Commercial real estate

780

801

1,033

1,155

-

-

16,712

-

20,481

     Total commercial real estate

1,598

1,818

1,808

1,353

-

177

31,962

-

38,716

Consumer










   Consumer mortgages

5,225

3,479

2,491

11,513

151

2,319

9,719

770

35,667

   Home equity

232

214

472

1,312

164

945

119

-

3,458

   Credit cards

-

-

-

-

-

-

-

1,130

1,130

     Total consumer

5,457

3,693

2,963

12,825

315

3,264

9,838

1,900

40,255

All other

115

125

11

105

1

67

359

4

787

     Total loans

$       8,577

$       8,026

$       7,550

$      19,361

$          788

$       3,825

$      61,244

$       2,140

$      111,511











NON-PERFORMING LOANS AND LEASES










   AS A PERCENTAGE OF OUTSTANDING:










Commercial and industrial










   Commercial and industrial-non real estate

0.09%

0.65%

0.57%

0.22%

0.65%

0.34%

1.43%

1.46%

0.73%

   Commercial and industrial-owner occupied

0.44%

0.68%

0.43%

0.64%

0.00%

0.00%

1.38%

N/A

0.76%

     Total commercial and industrial

0.30%

0.67%

0.50%

0.46%

0.36%

0.13%

1.40%

1.46%

0.75%

Commercial real estate










   Agricultural

2.06%

0.82%

0.79%

0.11%

0.00%

0.00%

3.42%

0.00%

1.63%

   Construction, acquisition and development

0.08%

0.65%

0.72%

0.04%

0.00%

0.15%

1.43%

N/A

0.81%

   Commercial real estate

0.23%

0.22%

0.31%

0.18%

0.00%

0.00%

1.52%

0.00%

0.64%

     Total commercial real estate

0.29%

0.36%

0.41%

0.13%

0.00%

0.05%

1.60%

0.00%

0.75%

Consumer










   Consumer mortgages

0.92%

1.01%

0.71%

1.34%

0.16%

0.72%

1.06%

0.84%

1.01%

   Home equity

0.21%

0.43%

0.52%

0.54%

0.93%

0.68%

0.38%

0.00%

0.51%

   Credit cards

N/A

N/A

N/A

N/A

N/A

N/A

N/A

1.10%

1.10%

     Total consumer

0.80%

0.93%

0.67%

1.17%

0.28%

0.71%

1.04%

0.98%

0.93%

All other

0.36%

0.56%

0.06%

0.08%

0.03%

0.40%

0.48%

0.01%

0.21%

     Total loans

0.50%

0.63%

0.52%

0.57%

0.16%

0.36%

1.40%

0.73%

0.79%

 

 

BancorpSouth Bank


Acquired Loan Information


(Dollars in thousands)


(Unaudited)













Quarter Ended December 31, 2019








Acquired Loans
Accounted for Under
ASC 310-20

Acquired Loans
Accounted for
Under ASC 310-30

Total Acquired
Loans







Net book value of acquired loans at beginning of period

$            1,814,588

$                30,468

$     1,845,056


Fair value of loans acquired during the period

-

-

-


Changes in acquired loans

(212,008)

(4,783)

(216,791)


Net book value of acquired loans at end of period

$            1,602,580

$                25,685

$     1,628,265












Loan mark on acquired loans at beginning of period

$               (27,544)

$              (25,593)

$        (53,137)


Loan mark recorded on loans acquired during the period

-

-

-


Change in remaining nonaccretable difference (for ASC 310-30 loans only)

-

332

332


Net accretion recognized on acquired loans

3,770

2,795

6,565


Remaining loan mark on acquired loans*

$               (23,774)

$              (22,466)

$        (46,240)








Quarter Ended September 30, 2019








Acquired Loans
Accounted for Under
ASC 310-20

Acquired Loans
Accounted for
Under ASC 310-30

Total Acquired
Loans







Net book value of acquired loans at beginning of period

$            1,395,140

$                26,163

$     1,421,303


Fair value of loans acquired during the period

583,780

6,253

590,033


Changes in acquired loans

(164,332)

(1,948)

(166,280)


Net book value of acquired loans at end of period

$            1,814,588

$                30,468

$     1,845,056












Loan mark on acquired loans at beginning of period

$               (15,493)

$              (22,915)

$        (38,408)


Loan mark recorded on loans acquired during the period

(14,826)

(5,327)

(20,153)


Change in remaining nonaccretable difference (for ASC 310-30 loans only)

-

315

315


Net accretion recognized on acquired loans

2,775

2,334

5,109


Remaining loan mark on acquired loans

$               (27,544)

$              (25,593)

$        (53,137)













Quarter Ended

Quarter Ended

Quarter Ended



12/31/2019

9/30/2019

6/30/2019


Loan yield, as reported

5.13%

5.16%

5.12%







Loan yield, excluding net accretion on acquired loans

4.95%

5.02%

5.02%







Net interest margin, as reported

3.76%

3.88%

3.87%







Net interest margin, excluding net accretion on acquired loans 

3.61%

3.76%

3.79%












Certain balances within the Acquired Loan Information have been adjusted for prior periods to reflect changes made to loans accounted for under ASC 310-30 during the measurement period. These changes may result in certain balances not agreeing to other prior period information presented within this news release.











* The remaining loan mark shown above for loans accounted for under ASC 310-30 includes approximately $426,000 in accretable yield as of December 31, 2019 compared to $865,000 in accretable yield as of September 30, 2019. In addition, the same loans include $22.0 million in nonaccretable difference as of December 31, 2019 compared to $24.7 million as of September 30, 2019.

 

 

BancorpSouth Bank

Noninterest Revenue and Expense

(Dollars in thousands)

(Unaudited)
















Quarter Ended


Year to Date


Dec-19


Sep-19


Jun-19


Mar-19


Dec-18


Dec-19


Dec-18

NONINTEREST REVENUE:














Mortgage banking excl. MSR and MSR Hedge market value adj

$      6,938


$       11,283


$         9,167


$      6,909


$         4,789


$  34,297


$  24,671

MSR and MSR Hedge market value adjustment

3,164


(3,994)


(8,816)


(4,869)


(8,064)


(14,515)


(1,260)

Credit card, debit card and merchant fees

9,836


9,778


10,168


8,874


9,941


38,656


39,892

Deposit service charges

12,193


11,939


11,117


10,766


11,699


46,015


44,645

Securities gains (losses), net

(41)


117


59


39


162


174


133

Insurance commissions

27,648


31,512


33,951


30,180


27,981


123,291


121,781

Trust income

3,951


4,488


3,815


3,788


3,681


16,042


15,121

Annuity fees

136


184


245


265


218


830


1,148

Brokerage commissions and fees

2,530


1,979


1,846


1,582


1,635


7,937


6,723

Bank-owned life insurance

3,427


2,529


1,854


1,822


3,636


9,632


11,684

Other miscellaneous income

4,915


5,617


2,926


4,864


3,353


18,322


17,499

     Total noninterest revenue

$    74,697


$       75,432


$       66,332


$    64,220


$       59,031


$ 280,681


$ 282,037















NONINTEREST EXPENSE:














Salaries and employee benefits

$    97,137


$      101,154


$      100,981


$    97,228


$       92,013


$ 396,500


$ 364,307

Occupancy, net of rental income

12,267


12,323


11,988


11,551


12,107


48,129


45,704

Equipment

4,725


4,676


4,423


3,888


3,837


17,712


15,389

Deposit insurance assessments

2,200


2,038


2,165


2,740


1,866


9,143


10,309

Advertising

1,153


1,382


1,427


947


1,440


4,909


5,043

Foreclosed property expense

855


870


519


624


1,113


2,868


3,396

Telecommunications

1,504


1,400


1,419


1,340


1,364


5,663


5,226

Public relations

880


1,069


934


765


834


3,648


3,252

Data processing

10,041


9,066


7,968


8,442


8,231


35,517


31,674

Computer software

4,478


3,825


3,835


3,699


3,840


15,837


14,452

Amortization of intangibles

2,508


2,117


2,508


1,985


2,040


9,118


6,639

Legal

854


786


1,310


605


1,082


3,555


3,998

Merger expense

5,782


4,062


3,136


891


4,456


13,871


13,036

Postage and shipping

1,353


1,281


1,217


1,412


1,214


5,263


4,840

Other miscellaneous expense

16,614


13,565


13,844


13,851


16,905


57,874


60,369

     Total noninterest expense

$  162,351


$      159,614


$      157,674


$  149,968


$      152,342


$ 629,607


$ 587,634















INSURANCE COMMISSIONS:














Property and casualty commissions

$    19,994


$       22,643


$       23,429


$    21,238


$       19,242


$  87,304


$  84,290

Life and health commissions

5,979


6,116


7,355


5,982


5,892


25,432


24,750

Risk management income

667


564


622


587


558


2,440


2,548

Other

1,008


2,189


2,545


2,373


2,289


8,115


10,193

     Total insurance commissions

$    27,648


$       31,512


$       33,951


$    30,180


$       27,981


$ 123,291


$ 121,781

 

 

BancorpSouth Bank

Selected Additional Information

(Dollars in thousands)

(Unaudited)








Quarter Ended


Dec-19

Sep-19

Jun-19

Mar-19

Dec-18

MORTGAGE SERVICING RIGHTS:






Fair value, beginning of period

$      51,492

$       55,294

$       64,643

$      69,822

$       77,796

Additions to mortgage servicing rights:






   Originations of servicing assets

4,025

3,410

2,790

1,976

2,840

Changes in fair value:






   Due to payoffs/paydowns

(2,323)

(2,542)

(2,739)

(2,052)

(2,465)

   Due to change in valuation inputs or






     assumptions used in the valuation model

3,915

(4,669)

(9,399)

(5,103)

(8,348)

   Other changes in fair value

-

(1)

(1)

-

(1)

Fair value, end of period

$      57,109

$       51,492

$       55,294

$      64,643

$       69,822







MORTGAGE BANKING REVENUE:






Production revenue:






   Origination

$       4,326

$         8,922

$         7,016

$       4,068

$         2,207

   Servicing

4,935

4,903

4,890

4,893

5,047

   Payoffs/Paydowns

(2,323)

(2,542)

(2,739)

(2,052)

(2,465)

     Total production revenue

6,938

11,283

9,167

6,909

4,789

Market value adjustment on MSR

3,915

(4,669)

(9,399)

(5,103)

(8,348)

Market value adjustment on MSR Hedge

(751)

675

583

234

284

Total mortgage banking revenue

$      10,102

$         7,289

$            351

$       2,040

$        (3,275)



















Mortgage loans serviced

$ 6,898,195

$   6,799,186

$   6,749,416

$ 6,718,236

$   6,686,475

MSR/mtg loans serviced

0.83%

0.76%

0.82%

0.96%

1.04%







AVAILABLE-FOR-SALE SECURITIES, at fair value






U.S. Government agencies

3,599,317

2,323,159

$   2,283,899

$ 2,179,699

$   2,200,158

U.S. Government agency issued residential






   mortgage-back securities

133,375

128,677

134,648

141,542

136,846

U.S. Government agency issued commercial






   mortgage-back securities

609,009

115,228

94,878

98,941

107,841

Obligations of states and political subdivisions

140,273

199,382

247,307

272,317

304,343

Total available-for-sale securities

$ 4,481,974

$   2,766,446

$   2,760,732

$ 2,692,499

$   2,749,188

 

 

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-excluding MSR income available to common shareholders, total operating expense, tangible shareholders' equity to tangible assets, tangible common shareholders' equity to tangible assets, return on tangible equity, return on tangible common equity, operating return on tangible equity-excluding MSR, operating return on 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, 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-Excluding MSR Available to Common Shareholders to Net Income:




















Quarter ended


Year to Date




12/31/2019


9/30/2019


6/30/2019


3/31/2019


12/31/2018


12/31/2019


12/31/2018

















Net income


$      65,849


$   63,757


$          53,057


$          51,598


$          47,097


$         234,261


$       221,317

Plus:

Merger expense, net of tax


4,339


3,049


2,354


669


3,345


10,411


9,784

Less:

Security gains(losses), net of tax


(30)


88


45


29


122


132


100


Tax-related matters


-


-


-


-


-


-


11,288

Net operating income


$      70,218


$   66,718


$          55,366


$          52,238


$          50,320


$         244,540


$       219,713

Less:

Preferred dividends


-


-


-


-


-


-


-

Net operating income available to















common shareholders


$      70,218


$   66,718


$          55,366


$          52,238


$          50,320


$         244,540


$       219,713

































Net operating income


$      70,218


$   66,718


$          55,366


$          52,238


$          50,320


$         244,540


$       219,713

Less:

MSR market value adjustment, net of tax

2,374


(2,998)


(6,616)


(3,654)


(6,052)


(10,894)


(946)

Net operating income-excluding MSR


$      67,844


$   69,716


$          61,982


$          55,892


$          56,372


$         255,434


$       220,659

Less:

Preferred dividends


-


-


-


-


-


-


-

Net operating income-excluding MSR available















to common shareholders


$      67,844


$   69,716


$          61,982


$          55,892


$          56,372


$         255,434


$       220,659

















Reconciliation of Total Operating Expense to Total Noninterest Expense:



























Total noninterest expense


$    162,351


$ 159,614


$        157,674


$         149,968


$         152,342


$         629,607


$       587,634

Less:

Merger expense


5,782


4,062


3,136


891


4,456


13,871


13,036

Total operating expense


$    156,569


$ 155,552


$        154,538


$         149,077


$         147,886


$         615,736


$       574,598

 

 

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


Year to Date




12/31/2019


9/30/2019


6/30/2019


3/31/2019


12/31/2018


12/31/2019


12/31/2018

Tangible assets















Total assets


$ 21,052,576


$  19,850,225


$  18,936,814


$ 18,314,183


$  18,001,540


$ 21,052,576


$ 18,001,540

Less:  

Goodwill


825,679


822,093


734,473


699,073


695,720


825,679


695,720


Other identifiable intangible assets


60,008


61,100


65,930


49,396


50,896


60,008


50,896

Total tangible assets


$ 20,166,889


$  18,967,032


$  18,136,411


$ 17,565,714


$  17,254,924


$ 20,166,889


$ 17,254,924

















PERIOD END BALANCES:















Tangible shareholders' equity















Total shareholders' equity


$   2,685,017


$    2,489,427


$    2,327,120


$   2,226,585


$    2,205,737


$   2,685,017


$   2,205,737

Less:

Goodwill


825,679


822,093


734,473


699,073


695,720


825,679


695,720


Other identifiable intangible assets


60,008


61,100


65,930


49,396


50,896


60,008


50,896

Total tangible shareholders' equity


$   1,799,330


$    1,606,234


$    1,526,717


$   1,478,116


$    1,459,121


$   1,799,330


$   1,459,121

Less:

Preferred stock


167,021


-


-


-


-


167,021


-

Total tangible common shareholders' equity


$   1,632,309


$    1,606,234


$    1,526,717


$   1,478,116


$    1,459,121


$   1,632,309


$   1,459,121

















AVERAGE BALANCES:















Tangible shareholders' equity















Total shareholders' equity


$   2,572,750


$    2,378,882


$    2,298,512


$   2,212,748


$    2,191,852


$   2,366,745


$   2,086,922

Less:

Goodwill


823,812


761,084


735,540


695,787


668,544


754,426


596,655


Other identifiable intangible assets


60,559


59,253


49,058


50,115


47,567


54,787


35,752

Total tangible shareholders' equity


$   1,688,379


$    1,558,545


$    1,513,914


$   1,466,846


$    1,475,741


$   1,557,532


$   1,454,515

Less:

Preferred stock


74,717


-


-


-


-


18,833


-

Total tangible common shareholders' equity


$   1,613,662


$    1,558,545


$    1,513,914


$   1,466,846


$    1,475,741


$   1,538,699


$   1,454,515

















Total average assets


$ 20,243,023


$  19,170,926


$  18,637,258


$ 18,033,513


$  17,879,081


$ 19,027,644


$ 17,240,092

Total shares of common stock outstanding


104,522,804


104,775,876


100,651,798


99,066,856


99,797,271


104,522,804


99,797,271

Average shares outstanding-diluted


105,144,032


101,493,247


100,888,164


99,717,119


99,720,219


101,810,640


99,134,861

















Tangible shareholders' equity to tangible assets (1)


8.92%


8.47%


8.42%


8.41%


8.46%


8.92%


8.46%

Tangible common shareholders' equity to tangible assets (2)


8.09%


8.47%


8.42%


8.41%


8.46%


8.09%


8.46%

Return on average tangible equity (3)


15.47%


16.23%


14.06%


14.27%


12.66%


15.04%


15.22%

Return on average tangible common equity (4)


16.19%


16.23%


14.06%


14.27%


12.66%


15.22%


15.22%

Operating return on average tangible equity-excluding MSR (5)


15.94%


17.75%


16.42%


15.45%


15.15%


16.40%


15.95%

Operating return on average tangible common equity-excluding MSR (6)


16.68%


17.75%


16.42%


15.45%


15.15%


16.60%


15.95%

Operating return on average assets-excluding MSR (7)


1.33%


1.44%


1.33%


1.26%


1.25%


1.34%


1.28%

Operating return on average shareholders' equity-excluding MSR (8)


10.46%


11.63%


10.82%


10.24%


10.20%


10.79%


10.57%

Operating return on average common shareholders' equity-excluding MSR (9)


10.78%


11.63%


10.82%


10.24%


10.20%


10.88%


10.57%

Tangible book value per common share (10)


$         15.62


$          15.33


$          15.17


$         14.92


$         14.62


$         15.62


$         14.62

Operating earnings per common share (11)


$           0.67


$            0.66


$            0.55


$           0.52


$           0.51


$           2.40


$           2.22

Operating earnings per common share-excluding MSR (12)


$           0.65


$            0.69


$            0.61


$           0.56


$           0.57


$           2.51


$           2.23

































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

(3)

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

(4)

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.

(5)

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.

(6)

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

(7)

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

(8)

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.

(9)

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

(10)

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

















(11)

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.

















(12)

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

 

 

Cision View original content:http://www.prnewswire.com/news-releases/bancorpsouth-announces-record-annual-earnings-300991618.html

SOURCE BancorpSouth Bank



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