Exhibit 99.1

News Release

 

 

Contact:
Chris Bagley		Will Fisackerly
President and Chief Operating Officer;   Interim Chief Financial Officer		Senior Vice President and   Director of Corporate Finance
662/680-2009		662/680-2475

BancorpSouth Announces First Quarter 2017 Financial Results

TUPELO, MS, April 19, 2017/PRNewswire — BancorpSouth, Inc. (NYSE: BXS) today announced financial results for the quarter ended March 31, 2017.

Highlights for the first quarter of 2017 included:

 

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Net income of $38.1 million, or $0.41 per diluted share.

 

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Generated total deposit growth of $354.7 million, or 12.3 percent on an annualized basis.

 

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Net interest margin remained stable at 3.46 percent.

 

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Earnings benefitted from a positive pre-tax mortgage servicing rights (“MSR”) valuation adjustment of $0.9 million.

 

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Net operating income – excluding MSR – of $36.9 million, or $0.39 per diluted share.

 

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Credit quality remained stable; recorded provision for credit losses of $1.0 million for the quarter.

 

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Total operating expense declined compared to both the first and fourth quarters of 2016 and operating efficiency ratio – excluding MSR – declined to 68.4 percent.

 

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Repurchased 1,613,691 shares of outstanding common stock at a weighted average price of $30.62 per share.

The Company reported net income of $38.1 million, or $0.41 per diluted share, for the first quarter of 2017 compared with net income of $22.5 million, or $0.24 per diluted share, for the first quarter of 2016 and net income of $37.7 million, or $0.40 per diluted share, for the fourth quarter of 2016.

 

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BancorpSouth, Inc.

Box 789 ● Tupelo, MS 38802-0789 ● (662) 680-2000

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BXS Announces First Quarter 2017 Financial Results

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The Company reported net operating income – excluding MSR – of $36.9 million, or $0.39 per diluted share, for the first quarter of 2017 compared to $36.9 million, or $0.39 per diluted share, for the first quarter of 2016 and $30.7 million, or $0.33 per diluted share, for the fourth quarter of 2016. 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 securities gains and losses, MSR valuation adjustments, restructuring charges, merger-related expenses, industry-related legal settlements, and other one-time charges. A full reconciliation of this measure is provided in the supplemental schedules of this news release.

“Our first quarter results reflect consistent improvement in our financial results, highlighted by continued balance sheet growth, disciplined expense control, and continued share repurchase activity,” remarked Dan Rollins, Chairman and Chief Executive Officer. “We reported deposit growth for the quarter of $354.7 million, or 12.3 percent on an annualized basis. While first quarter is typically seasonally high for deposit growth, this growth is reflective of our teammates’ continued commitment to broadening customer relationships and growing core deposits. Total operating expenses declined compared to both the first and fourth quarters of 2016, resulting in a decline in the operating efficiency ratio - excluding MSR - to 68.4 percent. Finally, we continue to be active in our share repurchase program, as we repurchased just over 1.6 million shares during the quarter at a weighted average price of $30.62 per share.”

“Additionally, our net interest margin remained stable at 3.46 percent compared to the fourth quarter of last year. Yields on both our loan portfolio and securities portfolio increased during the quarter while our average cost of deposits remained flat. This benefit to our margin was offset by a shift in our asset mix, which resulted from increases in lower yielding assets, including overnight investments and securities.”

Net Interest Revenue

Net interest revenue was $114.6 million for the first quarter of 2017, an increase of 3.1 percent from $111.2 million for the first quarter of 2016 and a decrease of 0.7 percent from $115.4 million for the fourth quarter of 2016. The fully taxable equivalent net interest margin was 3.46 percent for the first quarter of 2017 compared to 3.56 percent for the first quarter of 2016 and 3.46 percent for the fourth quarter of 2016. Yields on loans and leases were 4.20 percent for the first quarter of 2017 compared with 4.21 percent for the first quarter of 2016 and 4.18 percent for the fourth quarter of 2016, while yields on total interest earning assets were 3.70 percent for the first quarter of 2017 compared with 3.78 percent for the first quarter of 2016 and 3.70 percent for the fourth quarter of 2016. The average cost of deposits was 0.23 percent for the first quarter of 2017 compared to 0.21 percent for the first quarter of 2016 and 0.23 percent for the fourth quarter of 2016.

Asset, Deposit and Loan Activity

Total assets were $14.9 billion at March 31, 2017 compared with $13.9 billion at March 31, 2016. Loans and leases, net of unearned income, were $10.8 billion at March 31, 2017 compared with $10.4 billion at March 31, 2016.

 

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Total deposits were $12.0 billion at March 31, 2017 compared with $11.5 billion at March 31, 2016. Time deposits decreased $11.0 million, or 0.6 percent, at March 31, 2017 compared to March 31, 2016. Over the same time period, interest bearing demand deposits increased $148.4 million, or 2.9 percent, while noninterest bearing demand deposits increased $298.0 million, or 9.6 percent, and savings deposits increased $120.7 million, or 8.0 percent.

Provision for Credit Losses and Allowance for Credit Losses

Earnings for the first quarter reflect a provision for credit losses of $1.0 million, which was flat compared to both the first and fourth quarters of 2016. Net recoveries for the first quarter of 2017 were $0.5 million, compared with net charge-offs of $1.0 million for the first quarter of 2016 and net charge-offs of $3.2 million for the fourth quarter of 2016. The allowance for credit losses was $125.2 million, or 1.16 percent of net loans and leases, at March 31, 2017, compared with $126.5 million, or 1.21 percent of net loans and leases, at March 31, 2016 and $123.7 million, or 1.14 percent of net loans and leases, at December 31, 2016.

Total non-performing assets (“NPAs”) were $90.0 million, or 0.83 percent of net loans and leases, at March 31, 2017 compared with $106.9 million, or 1.02 percent of net loans and leases, at March 31, 2016, and $109.7 million, or 1.01 percent of net loans and leases, at December 31, 2016. Other real estate owned was $8.5 million at March 31, 2017 compared with $12.7 million at March 31, 2016 and $7.8 million at December 31, 2016.

Noninterest Revenue

Noninterest revenue was $70.9 million for the first quarter of 2017, compared with $64.7 million for the first quarter of 2016 and $72.0 million for the fourth quarter of 2016. These results included a positive MSR valuation adjustment of $0.9 million for the first quarter of 2017 compared with a negative MSR valuation adjustment of $8.0 million for the first quarter of 2016 and a positive MSR valuation adjustment of $11.2 million for the fourth quarter of 2016. Valuation adjustments in the MSR asset are driven primarily by fluctuations in interest rates period over period.

Excluding the MSR valuation adjustments, mortgage banking revenue was $8.1 million for the first quarter of 2017, compared with $9.8 million for the first quarter of 2016 and $5.6 million for the fourth quarter of 2016. Mortgage origination volume for the first quarter of 2017 was $287.8 million, compared with $315.4 million for the first quarter of 2016 and $395.9 million for the fourth quarter of 2016.

Credit and debit card fee revenue was $8.9 million for the first quarter of 2017, compared with $9.0 million for the first quarter of 2016 and $9.3 million for the fourth quarter of 2016. Deposit service charge revenue was $9.7 million for the first quarter of 2017, compared with $11.0 million for the first quarter of 2016 and $10.0 million for the fourth quarter of 2016. Insurance commission revenue was $32.9 million for the first quarter of 2017, compared with $33.2 million for the first quarter of 2016 and $25.7 million for the fourth quarter of 2016. Wealth management revenue was $5.2 million for the first quarter of 2017, compared with $5.1 million for the first quarter of 2016 and $5.4 million for the fourth quarter of 2016.

 

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BXS Announces First Quarter 2017 Financial Results

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Noninterest Expense

Noninterest expense for the first quarter of 2017 was $127.1 million, compared with $141.5 million for the first quarter of 2016 and $130.5 million for the fourth quarter of 2016. Total noninterest expense for the first quarter of 2016 included a charge of $13.8 million to reflect a liability associated with the settlement of a previously announced joint investigation by the Consumer Financial Protection Bureau and the U.S. Department of Justice. Salaries and employee benefits expense was $81.4 million for the first quarter of 2017 compared to $81.7 million for the first quarter of 2016 and $80.9 million for the fourth quarter of 2016. Occupancy expense was $10.3 million for the first quarter of 2017, which was flat compared to both the first and fourth quarters of 2016. Other noninterest expense was $29.4 million for the first quarter of 2017, compared to $33.2 million for the first quarter of 2016 and $34.0 million for the fourth quarter of 2016.

Capital Management

The Company’s equity capitalization is comprised entirely of common stock. BancorpSouth’s ratio of shareholders’ equity to assets was 11.45 percent at March 31, 2017, compared with 12.06 percent at March 31, 2016 and 11.71 percent at December 31, 2016. The ratio of tangible shareholders’ equity to tangible assets was 9.49 percent at March 31, 2017, compared with 10.05 percent at March 31, 2016 and 9.73 percent at December 31, 2016.

During the first quarter of 2017, the Company repurchased 1,613,691 shares of its outstanding common stock at a weighted average price of $30.62 per share. During the fourth quarter of 2016, the Company repurchased 436,541 shares at a weighted average price of $22.91 per share. As of March 31, 2017, the Company had 4,398,249 remaining shares available for repurchase under its current share repurchase authorization, which expires on December 29, 2017. On January 9, 2017, the Company redeemed $6.7 million in junior subordinated debt securities issued to American State Capital Trust I and $6.2 million in junior subordinated debt securities issued to Business Holding Company Trust I. Each of these junior subordinated debt securities was assumed by the Company pursuant to prior acquisitions of banks by the Company.

Estimated regulatory capital ratios at March 31, 2017 were calculated in accordance with the Basel III capital framework. BancorpSouth is a “well capitalized” financial holding company, as defined by federal regulations, with Tier 1 risk-based capital of 12.16 percent at March 31, 2017 and total risk-based capital of 13.21 percent, compared with required minimum levels of 8 percent and 10 percent, respectively, in order to qualify for “well capitalized” classification.

Transactions

On December 19, 2016, BancorpSouth Insurance Services, Inc. announced and closed the acquisition of certain assets of Gonzales, Louisiana based Waguespack & Associates Insurance, Inc. The agency was formed in 1986 and is expected to produce annual revenues of approximately $3 million. Waguespack will continue to operate under current leadership in its current location in Gonzales.

 

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On January 21, 2014, the Company announced the signing of a definitive merger agreement with Central Community Corporation, headquartered in Temple, Texas, pursuant to which Central Community Corporation agreed to be merged with and into the Company. Central Community Corporation is the parent company of First State Bank Central Texas (“First State Bank”), which is headquartered in Austin, Texas. First State Bank operates 31 full-service banking offices in central Texas. As of March 31, 2017, Central Community Corporation, on a consolidated basis, reported total assets of $1.4 billion, total loans of $678.0 million and total deposits of $1.1 billion. Under the terms of the definitive agreement, the Company will issue approximately 7,250,000 shares of the Company’s common stock plus $28.5 million in cash for all outstanding shares of Central Community Corporation’s capital stock, subject to certain conditions and potential adjustments. The merger has been unanimously approved by the Board of Directors of each company and was approved by Central Community Corporation shareholders on April 24, 2014. The Company and Central Community Corporation entered into an extension of the merger effective on October 13, 2016, extending the merger agreement through December 31, 2017 to allow for additional time to obtain the necessary regulatory approvals and to satisfy all closing conditions. The merger agreement remains in effect until terminated by the Board of Directors of the Company or Central Community Corporation. The terms of the agreement provide for a minimum total deal value of $202.5 million but also allow Central Community Corporation to terminate the agreement if the average closing price of the Company’s common stock declines below a certain threshold prior to closing. The transaction is expected to close shortly after receiving all required regulatory approvals, although the Company can provide no assurance that the merger will close timely or at all.

On January 8, 2014, the Company announced the signing of a definitive merger agreement with Ouachita Bancshares Corp., parent company of Ouachita Independent Bank (collectively referred to as “OIB”), headquartered in Monroe, Louisiana, pursuant to which Ouachita Bancshares Corp. agreed to be merged with and into the Company. OIB operates 11 full-service banking offices along the I-20 corridor and has a loan production office in Madison, Mississippi. As of March 31, 2017, OIB, on a consolidated basis, reported total assets of $732.4 million, total loans of $498.2 million and total deposits of $606.8 million. Under the terms of the definitive agreement, the Company will issue approximately 3,675,000 shares of the Company’s common stock plus $22.875 million in cash for all outstanding shares of Ouachita Bancshares Corp.’s capital stock, subject to certain conditions and potential adjustments. The merger has been unanimously approved by the Board of Directors of each company and was approved by Ouachita Bancshares Corp. shareholders on April 8, 2014. The Company and Ouachita Bancshares Corp. entered into an extension of the merger effective on October 13, 2016, extending the merger agreement through December 31, 2017 to allow for additional time to obtain the necessary regulatory approvals and to satisfy all closing conditions. The merger agreement remains in effect until terminated by the Board of Directors of the Company or Ouachita Bancshares Corp. The terms of the agreement provide for a minimum total deal value of $111.1 million but also allow Ouachita Bancshares Corp. to terminate the agreement if the average closing price of the Company’s common stock declines below a certain threshold prior to closing. The transaction is expected to close shortly after receiving all required regulatory approvals, although the Company can provide no assurance that the merger will close timely or at all.

 

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For the most recent information regarding the status of the merger with Central Community Corporation and the status of the merger with Ouachita Bancshares Corp. in our periodic and current reports, please refer to the Form 8-K that was previously filed with the SEC on October 14, 2016.

Summary

Rollins concluded, “We are pleased to see the positive momentum seen in our financial performance for the last several quarters continue into 2017. As we look toward the remainder of the year, I’m excited about the opportunity to continue to build on this progress. While first quarter is historically seasonally slow for loan growth, we are optimistic about our team’s ability to produce quality credits and grow loans. Additionally, our producers in other areas including mortgage, insurance, and wealth management continue to look for ways to grow their customer base despite certain industry-specific headwinds. Finally, our credit quality remains strong while total operating expenses remain flat. Our team is confident this simple approach will allow us to continue to improve our operating performance.”

Conference Call

BancorpSouth will conduct a conference call to discuss its first quarter 2017 results on April 20, 2017, at 10:00 a.m. (Central Time). Investors may listen via the Internet by accessing BancorpSouth’s website at www.bancorpsouth.com and accessing the “Investor Relations” webpage. A replay of the conference call will be available at BancorpSouth’s website for at least two weeks following the call.

About BancorpSouth, Inc.

BancorpSouth, Inc. (NYSE: BXS) is a financial holding company headquartered in Tupelo, Mississippi, with $14.9 billion in assets. BancorpSouth Bank, a wholly-owned subsidiary of BancorpSouth, Inc., operates 234 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 contained in this news release may not be based upon historical facts and are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements may be identified by their reference to a future period or periods or by the use of forward-looking terminology such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “foresee,” “hope,” “intend,” “may,” “might,” “plan,” “will,” or “would” or future or conditional verb tenses and variations or negatives of such terms. These forward-looking statements include, without limitation, those relating to the terms, timing and closings of the proposed mergers with Ouachita Bancshares Corp. and Central Community Corporation, the acceptance by customers of Ouachita Bancshares Corp. and Central Community Corporation of the Company’s products and services if the proposed mergers close, 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”), amortization expense for intangible assets, goodwill impairments, loan

 

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impairment, 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, 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, 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 and consideration to be used therefor, and the impact of certain claims and ongoing, pending or threatened litigation, administrative and investigatory matters.

The Company cautions readers not to place undue reliance on the forward-looking statements contained in this news release, in that actual results could differ materially from those indicated in such forward-looking statements as a result of a variety of factors. These factors 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, Ouachita Bancshares Corp. and Central Community Corporation to obtain regulatory approval of and close the proposed mergers, the willingness of Ouachita Bancshares Corp. and Central Community Corporation to proceed with the proposed mergers, the potential impact upon the Company of the delay in the closings of these proposed mergers, 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 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, 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 common 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 SEC. Forward-looking statements speak only as of the date that they were made, and, except as required by law, the Company does not undertake any obligation to update or revise forward-looking statements to reflect events or circumstances that occur after the date of this news release.

 

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BXS Announces First Quarter 2017 Financial Results

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BancorpSouth, Inc.

Selected Financial Information

(Dollars in thousands, except per share data)

(Unaudited)

 

		Quarter Ended				Quarter Ended				Quarter Ended				Quarter Ended				Quarter Ended
		3/31/2017				12/31/2016				9/30/2016				6/30/2016				3/31/2016
Earnings Summary:
Interest revenue		$	122,926			$	123,444			$	122,340			$	119,423			$	117,972
Interest expense			8,315				8,057				7,750				7,107				6,813
Net interest revenue			114,611				115,387				114,590				112,316				111,159
Provision for credit losses			1,000				1,000				—				2,000				1,000
Net interest revenue, after provision for credit losses			113,611				114,387				114,590				110,316				110,159
Noninterest revenue			70,869				71,975				69,673				68,526				64,727
Noninterest expense			127,109				130,519				128,317				127,561				141,512
Income before income taxes			57,371				55,843				55,946				51,281				33,374
Income tax expense			19,278				18,173				18,129				16,589				10,825
Net income		$	38,093			$	37,670			$	37,817			$	34,692			$	22,549
Balance Sheet - Period End Balances
Total assets		$	14,866,054			$	14,724,388			$	14,611,483			$	14,137,160			$	13,926,398
Total earning assets			13,757,920				13,549,407				13,483,345				12,977,030				12,760,031
Total securities			2,540,887				2,531,676				2,468,199				2,103,883				2,016,373
Loans and leases, net of unearned income			10,801,694				10,811,991				10,658,761				10,575,978				10,444,697
Allowance for credit losses			125,196				123,736				125,887				126,935				126,506
Total deposits			12,042,845				11,688,141				11,590,059				11,364,367				11,486,697
Long-term debt			530,000				530,000				563,495				365,588				67,681
Total shareholders’ equity			1,702,389				1,723,883				1,724,104				1,713,043				1,679,793
Balance Sheet - Average Balances
Total assets		$	14,832,260			$	14,655,360			$	14,366,759			$	14,027,786			$	13,851,661
Total earning assets			13,715,612				13,525,284				13,265,266				12,963,056				12,830,000
Total securities			2,507,701				2,479,008				2,186,889				2,069,058				2,037,739
Loans and leases, net of unearned income			10,820,486				10,737,802				10,601,481				10,513,732				10,372,925
Total deposits			11,941,851				11,700,213				11,509,764				11,437,422				11,431,480
Long-term debt			530,000				534,141				430,886				219,434				67,750
Total shareholders’ equity			1,731,931				1,724,871				1,719,503				1,690,906				1,668,465
Nonperforming Assets:
Non-accrual loans and leases		$	74,439			$	71,812			$	70,725			$	68,638			$	81,926
Loans and leases 90+ days past due, still accruing			3,063				3,983				2,255				1,875				4,567
Restructured loans and leases, still accruing			4,060				26,047				17,936				9,687				7,753
Non-performing loans (NPLs)			81,562				101,842				90,916				80,200				94,246
Other real estate owned			8,458				7,810				11,391				14,658				12,685
Non-performing assets (NPAs)		$	90,020			$	109,652			$	102,307			$	94,858			$	106,931
Financial Ratios and Other Data:
Return on average assets			1.04	%			1.02	%			1.05	%			0.99	%			0.65	%
Operating return on average assets-excluding MSR*			1.01	%			0.83	%			1.02	%			1.07	%			1.07	%
Return on average shareholders’ equity			8.92	%			8.69	%			8.75	%			8.25	%			5.44	%
Operating return on average shareholders’ equity-excluding MSR*			8.63	%			7.08	%			8.49	%			8.84	%			8.89	%
Return on tangible equity*			11.19	%			10.70	%			10.68	%			9.99	%			6.63	%
Operating return on tangible equity-excluding MSR*			10.82	%			8.71	%			10.36	%			10.70	%			10.84	%
Noninterest income to average assets			1.94	%			1.95	%			1.93	%			1.96	%			1.88	%
Noninterest expense to average assets			3.48	%			3.54	%			3.55	%			3.66	%			4.11	%
Net interest margin-fully taxable equivalent			3.46	%			3.46	%			3.51	%			3.56	%			3.56	%
Net interest rate spread			3.35	%			3.36	%			3.41	%			3.47	%			3.47	%
Efficiency ratio (tax equivalent)*			67.71	%			68.79	%			68.72	%			69.58	%			79.30	%
Operating efficiency ratio-excluding MSR (tax equivalent)*			68.43	%			73.14	%			69.39	%			68.01	%			70.41	%
Loan/deposit ratio			89.69	%			92.50	%			91.96	%			93.06	%			90.93	%
Price to earnings multiple (avg)			19.15				22.02				18.86				19.07				17.33
Market value to book value			164.09	%			168.76	%			126.59	%			125.23	%			119.81	%
Market value to book value (avg)			166.39	%			145.61	%			129.73	%			124.62	%			116.78	%
Market value to tangible book value			202.32	%			207.63	%			154.87	%			153.53	%			147.04	%
Market value to tangible book value (avg)			205.16	%			179.14	%			158.71	%			152.78	%			143.33	%
Headcount FTE			3,973				3,998				3,981				4,028				3,966

 

*	Denotes non-GAAP financial measure. Refer to related disclosure and reconciliation on pages 19 and 20.

 

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BXS Announces First Quarter 2017 Financial Results

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BancorpSouth, Inc.

Selected Financial Information

(Dollars in thousands, except per share data)

(Unaudited)

 

		Quarter Ended 3/31/2017				Quarter Ended 12/31/2016				Quarter Ended 9/30/2016				Quarter Ended 6/30/2016				Quarter Ended 3/31/2016
Credit Quality Ratios:
Net (recoveries) charge-offs to average loans and leases (annualized)			(0.02	%)			0.12	%			0.04	%			0.06	%			0.04	%
Provision for credit losses to average loans and leases (annualized)			0.04	%			0.04	%			0.00	%			0.08	%			0.04	%
Allowance for credit losses to net loans and leases			1.16	%			1.14	%			1.18	%			1.20	%			1.21	%
Allowance for credit losses to non-performing loans and leases			153.50	%			121.50	%			138.47	%			158.27	%			134.23	%
Allowance for credit losses to non-performing assets			139.08	%			112.84	%			123.05	%			133.82	%			118.31	%
Non-performing loans and leases to net loans and leases			0.76	%			0.94	%			0.85	%			0.76	%			0.90	%
Non-performing assets to net loans and leases			0.83	%			1.01	%			0.96	%			0.90	%			1.02	%
Equity Ratios:
Total shareholders’ equity to total assets			11.45	%			11.71	%			11.80	%			12.12	%			12.06	%
Tangible shareholders’ equity to tangible assets*			9.49	%			9.73	%			9.86	%			10.11	%			10.05	%
Capital Adequacy:
Common Equity Tier 1 capital			12.16	%			12.23	%			12.13	%			12.17	%			12.14	%
Tier 1 capital			12.16	%			12.34	%			12.32	%			12.37	%			12.34	%
Total capital			13.21	%			13.38	%			13.37	%			13.45	%			13.43	%
Tier 1 leverage capital			9.95	%			10.32	%			10.53	%			10.66	%			10.61	%
Estimated for current quarter
Common Share Data:
Basic earnings per share		$	0.41			$	0.40			$	0.40			$	0.37			$	0.24
Diluted earnings per share			0.41				0.40				0.40				0.37				0.24
Operating earnings per share*			0.40				0.40				0.40				0.37				0.34
Operating earnings per share- excluding MSR*			0.39				0.33				0.39				0.39				0.39
Cash dividends per share			0.13				0.13				0.13				0.10				0.10
Book value per share			18.44				18.40				18.33				18.12				17.79
Tangible book value per share*			14.95				14.95				14.98				14.78				14.49
Market value per share (last)			30.25				31.05				23.20				22.69				21.31
Market value per share (high)			32.40				31.75				25.09				24.18				23.64
Market value per share (low)			28.10				22.23				20.98				20.19				18.69
Market value per share (avg)			30.68				26.79				23.78				22.58				20.77
Dividend payout ratio			30.73	%			31.11	%			31.17	%			22.58	%			41.85	%
Total shares outstanding			92,344,409				93,696,687				94,074,740				94,546,091				94,438,626
Average shares outstanding - basic			93,642,848				93,740,626				94,303,916				94,461,025				94,369,211
Average shares outstanding - diluted			93,829,400				93,966,392				94,563,833				94,694,795				94,593,540
Yield/Rate:
(Taxable equivalent basis)
Loans, loans held for sale, and leases net of unearned income			4.20	%			4.18	%			4.20	%			4.20	%			4.21	%
Available-for-sale securities:
Taxable			1.35	%			1.31	%			1.33	%			1.40	%			1.40	%
Tax-exempt			5.29	%			5.29	%			5.32	%			5.36	%			5.36	%
Short-term investments			0.76	%			0.41	%			0.52	%			0.39	%			0.33	%
Total interest earning assets and revenue			3.70	%			3.70	%			3.74	%			3.78	%			3.78	%
Deposits			0.23	%			0.23	%			0.22	%			0.21	%			0.21	%
Demand - interest bearing			0.22	%			0.20	%			0.19	%			0.18	%			0.17	%
Savings			0.12	%			0.12	%			0.12	%			0.12	%			0.12	%
Other time			0.79	%			0.79	%			0.78	%			0.75	%			0.73	%
Short-term borrowings			0.31	%			0.16	%			0.15	%			0.15	%			0.14	%
Total interest bearing deposits & short-term borrowings			0.32	%			0.31	%			0.30	%			0.29	%			0.28	%
Junior subordinated debt			3.29	%			3.53	%			3.27	%			3.23	%			3.18	%
Long-term debt			0.87	%			0.73	%			0.83	%			1.21	%			3.08	%
Total interest bearing liabilities and expense			0.35	%			0.34	%			0.34	%			0.32	%			0.31	%
Interest bearing liabilities to interest earning assets			70.24	%			69.43	%			69.33	%			69.47	%			69.75	%
Net interest tax equivalent adjustment		$	2,261			$	2,371			$	2,462			$	2,493			$	2,558

 

*	Denotes non-GAAP financial measure. Refer to related disclosure and reconciliation on pages 19 and 20.

 

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BXS Announces First Quarter 2017 Financial Results

Page 10

April 19, 2017

 

BancorpSouth, Inc.

Consolidated Balance Sheets

(Unaudited)

 

		Mar-17				Dec-16				Sep-16				Jun-16				Mar-16
		(Dollars in thousands)
Assets
Cash and due from banks		$	147,684			$	184,152			$	172,782			$	186,381			$	197,538
Interest bearing deposits with other banks			253,738				38,813				151,944				86,472				148,915
Available-for-sale securities, at fair value			2,540,887				2,531,676				2,468,199				2,103,883				2,016,373
Loans and leases			10,822,568				10,835,512				10,685,166				10,604,547				10,475,528
Less: Unearned income			20,874				23,521				26,405				28,569				30,831
Allowance for credit losses			125,196				123,736				125,887				126,935				126,506
Net loans and leases			10,676,498				10,688,255				10,532,874				10,449,043				10,318,191
Loans held for sale			161,600				166,927				204,441				210,698				150,046
Premises and equipment, net			305,250				305,561				305,245				305,694				306,765
Accrued interest receivable			42,329				42,005				41,583				39,645				41,401
Goodwill			300,798				300,798				294,901				294,901				291,498
Other identifiable intangibles			20,865				21,894				19,908				20,831				19,664
Bank owned life insurance			258,518				258,648				257,015				255,240				253,427
Other real estate owned			8,458				7,810				11,391				14,658				12,685
Other assets			149,429				177,849				151,200				169,714				169,895
Total Assets		$	14,866,054			$	14,724,388			$	14,611,483			$	14,137,160			$	13,926,398
Liabilities
Deposits:
Demand: Noninterest bearing		$	3,401,348			$	3,250,537			$	3,308,361			$	3,133,460			$	3,103,321
Interest bearing			5,182,011				5,034,470				4,877,482				4,838,704				5,033,565
Savings			1,627,621				1,561,819				1,533,401				1,512,694				1,506,942
Other time			1,831,865				1,841,315				1,870,815				1,879,509				1,842,869
Total deposits			12,042,845				11,688,141				11,590,059				11,364,367				11,486,697
Securities sold under agreement to repurchase			375,832				454,002				468,969				415,949				431,089
Federal funds purchased and other short-term borrowing			—				92,000				—				—				—
Accrued interest payable			4,109				3,975				4,107				3,727				3,305
Junior subordinated debt securities			—				12,888				23,198				23,198				23,198
Long-term debt			530,000				530,000				563,495				365,588				67,681
Other liabilities			210,879				219,499				237,551				251,288				234,635
Total Liabilities			13,163,665				13,000,505				12,887,379				12,424,117				12,246,605
Shareholders’ Equity
Common stock			230,861				234,242				235,187				236,365				236,097
Capital surplus			226,204				271,292				278,973				286,994				283,800
Accumulated other comprehensive loss			(50,360	)			(50,937	)			(33,549	)			(27,587	)			(32,144	)
Retained earnings			1,295,684				1,269,286				1,243,493				1,217,271				1,192,040
Total Shareholders’ Equity			1,702,389				1,723,883				1,724,104				1,713,043				1,679,793
Total Liabilities & Shareholders’ Equity		$	14,866,054			$	14,724,388			$	14,611,483			$	14,137,160			$	13,926,398

 

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BXS Announces First Quarter 2017 Financial Results

Page 11

April 19, 2017

 

BancorpSouth, Inc.

Consolidated Average Balance Sheets

(Unaudited)

 

		Mar-17				Dec-16				Sep-16				Jun-16				Mar-16
		(Dollars in thousands)
Assets
Cash and due from banks		$	162,696			$	171,791			$	157,233			$	117,193			$	71,528
Interest bearing deposits with other banks			258,502				165,805				311,545				237,635				316,108
Available-for-sale securities, at fair value			2,507,701				2,479,008				2,186,889				2,069,058				2,037,739
Loans and leases			10,843,069				10,763,314				10,629,522				10,543,795				10,405,063
Less: Unearned income			22,583				25,512				28,041				30,063				32,138
Allowance for credit losses			124,662				125,526				126,820				126,103				126,567
Net loans and leases			10,695,824				10,612,276				10,474,661				10,387,629				10,246,358
Loans held for sale			128,923				142,669				165,351				142,632				103,227
Premises and equipment, net			305,637				305,994				305,707				307,600				308,065
Accrued interest receivable			38,774				38,648				38,125				36,887				38,306
Goodwill			300,798				296,888				294,901				292,620				291,498
Other identifiable intangibles			21,236				20,303				20,248				19,796				19,987
Bank owned life insurance			257,669				257,397				255,967				254,191				252,422
Other real estate owned			8,154				9,084				13,664				15,666				14,523
Other assets			146,346				155,497				142,468				146,879				151,900
Total Assets		$	14,832,260			$	14,655,360			$	14,366,759			$	14,027,786			$	13,851,661
Liabilities
Deposits:
Demand: Noninterest bearing		$	3,272,876			$	3,344,632			$	3,221,539			$	3,122,153			$	3,014,896
Interest bearing			5,244,069				4,951,906				4,886,920				4,957,827				5,102,648
Savings			1,587,725				1,543,542				1,525,016				1,510,250				1,468,262
Other time			1,837,181				1,860,133				1,876,289				1,847,192				1,845,674
Total deposits			11,941,851				11,700,213				11,509,764				11,437,422				11,431,480
Securities sold under agreement to repurchase			414,272				475,669				454,826				443,340				431,260
Federal funds purchased and other short-term borrowing			19,545				3,924				11				4,275				10,484
Accrued interest payable			3,867				4,031				3,950				3,509				3,248
Junior subordinated debt securities			1,146				21,181				23,198				23,198				23,198
Long-term debt			530,000				534,141				430,886				219,434				67,750
Other liabilities			189,648				191,330				224,621				205,702				215,776
Total Liabilities			13,100,329				12,930,489				12,647,256				12,336,880				12,183,196
Shareholders’ Equity
Common stock			234,285				234,323				235,860				236,176				235,946
Capital surplus			265,685				271,900				283,437				284,818				282,796
Accumulated other comprehensive loss			(50,616	)			(40,454	)			(29,743	)			(32,820	)			(36,184	)
Retained earnings			1,282,577				1,259,102				1,229,949				1,202,732				1,185,907
Total Shareholders’ Equity			1,731,931				1,724,871				1,719,503				1,690,906				1,668,465
Total Liabilities & Shareholders’ Equity		$	14,832,260			$	14,655,360			$	14,366,759			$	14,027,786			$	13,851,661

 

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BXS Announces First Quarter 2017 Financial Results

Page 12

April 19, 2017

 

BancorpSouth, Inc.

Consolidated Condensed Statements of Income

(Dollars in thousands, except per share data)

(Unaudited)

 

		Quarter Ended
		Mar-17				Dec-16				Sep-16				Jun-16				Mar-16
INTEREST REVENUE:
Loans and leases		$	111,498			$	112,189			$	111,605			$	109,078			$	107,805
Deposits with other banks			485				169				409				229				263
Available-for-sale securities:
Taxable			7,350				7,105				6,189				6,009				5,888
Tax-exempt			2,581				2,771				2,898				2,924				3,032
Loans held for sale			1,012				1,210				1,239				1,183				984
Total interest revenue			122,926				123,444				122,340				119,423				117,972
INTEREST EXPENSE:
Interest bearing demand			2,786				2,514				2,361				2,208				2,163
Savings			472				470				462				451				443
Other time			3,582				3,711				3,661				3,436				3,354
Federal funds purchased and securities sold under agreement to repurchase			322				190				173				159				140
Long-term debt			1,142				985				902				665				530
Junior subordinated debt			9				187				190				187				183
Other			2				—				1				1				—
Total interest expense			8,315				8,057				7,750				7,107				6,813
Net interest revenue			114,611				115,387				114,590				112,316				111,159
Provision for credit losses			1,000				1,000				—				2,000				1,000
Net interest revenue, after provision for credit losses			113,611				114,387				114,590				110,316				110,159
NONINTEREST REVENUE:
Mortgage banking			8,990				16,803				11,087				7,886				1,830
Credit card, debit card and merchant fees			8,903				9,262				9,292				9,495				8,961
Deposit service charges			9,689				9,956				11,313				11,018				11,014
Security gains, net			1,071				39				1				86				2
Insurance commissions			32,940				25,709				28,194				28,803				33,249
Wealth management			5,174				5,401				5,312				5,347				5,109
Other			4,102				4,805				4,474				5,891				4,562
Total noninterest revenue			70,869				71,975				69,673				68,526				64,727
NONINTEREST EXPENSE:
Salaries and employee benefits			81,386				80,850				80,884				80,675				81,679
Occupancy, net of rental income			10,302				10,294				10,412				10,109				10,273
Equipment			3,568				3,563				3,423				3,295				3,765
Deposit insurance assessments			2,484				1,818				3,227				2,582				2,288
Regulatory settlement			—				—				—				—				10,277
Other			29,369				33,994				30,371				30,900				33,230
Total noninterest expense			127,109				130,519				128,317				127,561				141,512
Income before income taxes			57,371				55,843				55,946				51,281				33,374
Income tax expense			19,278				18,173				18,129				16,589				10,825
Net income		$	38,093			$	37,670			$	37,817			$	34,692			$	22,549
Net income per share: Basic		$	0.41			$	0.40			$	0.40			$	0.37			$	0.24
Diluted		$	0.41			$	0.40			$	0.40			$	0.37			$	0.24

 

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BXS Announces First Quarter 2017 Financial Results

Page 13

April 19, 2017

 

BancorpSouth, Inc.

Selected Loan Data

(Dollars in thousands)

(Unaudited)

 

		Quarter Ended
		Mar-17				Dec-16				Sep-16				Jun-16				Mar-16
LOAN AND LEASE PORTFOLIO:
Commercial and industrial		$	1,536,527			$	1,612,295			$	1,616,152			$	1,698,089			$	1,716,477
Real estate
Consumer mortgages			2,675,672				2,643,966				2,611,387				2,549,989				2,480,828
Home equity			626,488				628,846				622,566				614,686				605,228
Agricultural			240,534				245,377				242,171				251,566				239,422
Commercial and industrial-owner occupied			1,801,613				1,764,265				1,668,477				1,644,618				1,654,577
Construction, acquisition and development			1,136,827				1,157,248				1,121,386				1,021,218				966,362
Commercial real estate			2,271,542				2,237,719				2,240,717				2,254,653				2,233,742
Credit cards			103,813				109,656				107,447				108,101				106,714
All other			408,678				412,619				428,458				433,058				441,347
Total loans		$	10,801,694			$	10,811,991			$	10,658,761			$	10,575,978			$	10,444,697
ALLOWANCE FOR CREDIT LOSSES:
Balance, beginning of period		$	123,736			$	125,887			$	126,935			$	126,506			$	126,458
Loans and leases charged-off:
Commercial and industrial			(384	)			(2,483	)			(1,180	)			(748	)			(140	)
Real estate
Consumer mortgages			(596	)			(905	)			(595	)			(477	)			(710	)
Home equity			(459	)			(873	)			(237	)			(224	)			(550	)
Agricultural			(44	)			—				(89	)			(10	)			(11	)
Commercial and industrial-owner occupied			(404	)			(20	)			(261	)			(660	)			(154	)
Construction, acquisition and development			(30	)			(10	)			(5	)			(280	)			(226	)
Commercial real estate			(19	)			—				(14	)			(870	)			(245	)
Credit cards			(838	)			(815	)			(696	)			(614	)			(720	)
All other			(559	)			(580	)			(713	)			(417	)			(487	)
Total loans charged-off			(3,333	)			(5,686	)			(3,790	)			(4,300	)			(3,243	)
Recoveries:
Commercial and industrial			490				1,019				263				339				212
Real estate
Consumer mortgages			625				413				327				499				455
Home equity			356				71				109				246				80
Agricultural			41				15				28				96				36
Commercial and industrial-owner occupied			193				201				117				101				125
Construction, acquisition and development			1,324				195				382				524				272
Commercial real estate			69				176				1,043				509				683
Credit cards			249				208				262				199				181
All other			446				237				211				216				247
Total recoveries			3,793				2,535				2,742				2,729				2,291
Net recoveries (charge-offs)			460				(3,151	)			(1,048	)			(1,571	)			(952	)
Provision charged to operating expense			1,000				1,000				—				2,000				1,000
Balance, end of period		$	125,196			$	123,736			$	125,887			$	126,935			$	126,506
Average loans for period		$	10,820,486			$	10,737,802			$	10,601,481			$	10,513,732			$	10,372,925
Ratio:
Net (recoveries) charge-offs to average loans (annualized)			(0.02	%)			0.12	%			0.04	%			0.06	%			0.04	%

 

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BXS Announces First Quarter 2017 Financial Results

Page 14

April 19, 2017

 

BancorpSouth, Inc.

Selected Loan Data

(Dollars in thousands)

(Unaudited)

 

		Quarter Ended
		Mar-17				Dec-16				Sep-16				Jun-16				Mar-16
NON-PERFORMING ASSETS
NON-PERFORMING LOANS AND LEASES:
Nonaccrual Loans and Leases
Commercial and industrial		$	13,959			$	13,679			$	11,659			$	8,675			$	10,248
Real estate
Consumer mortgages			21,543				21,084				20,196				19,309				22,968
Home equity			3,157				3,817				3,721				2,734				3,564
Agricultural			5,180				1,546				1,194				1,107				932
Commercial and industrial-owner occupied			15,135				10,791				11,983				16,021				16,633
Construction, acquisition and development			1,466				7,022				6,939				6,086				7,720
Commercial real estate			13,638				13,402				14,793				14,197				19,417
Credit cards			87				161				121				159				188
All other			274				310				119				350				256
Total nonaccrual loans and leases		$	74,439			$	71,812			$	70,725			$	68,638			$	81,926
Loans and Leases 90+ Days Past Due, Still Accruing:			3,063				3,983				2,255				1,875				4,567
Restructured Loans and Leases, Still Accruing			4,060				26,047				17,936				9,687				7,753
Total non-performing loans and leases			81,562				101,842				90,916				80,200				94,246
OTHER REAL ESTATE OWNED:			8,458				7,810				11,391				14,658				12,685
Total Non-performing Assets		$	90,020			$	109,652			$	102,307			$	94,858			$	106,931
Additions to Nonaccrual Loans and Leases During the Quarter		$	23,348			$	16,007			$	17,319			$	10,553			$	15,933
Loans and Leases 30-89 Days Past Due, Still Accruing:
Commercial and industrial		$	4,083			$	3,449			$	6,736			$	3,748			$	3,758
Real estate
Consumer mortgages			10,149				14,490				15,443				15,784				11,985
Home equity			1,720				3,072				3,854				2,842				2,414
Agricultural			364				1,283				616				367				240
Commercial and industrial-owner occupied			1,949				2,120				1,712				2,854				669
Construction, acquisition and development			3,306				1,344				1,272				1,137				1,489
Commercial real estate			2,631				653				15,221				3,776				1,831
Credit cards			800				726				774				677				569
All other			776				673				1,089				712				606
Total Loans and Leases 30-89 days past due, still accruing		$	25,778			$	27,810			$	46,717			$	31,897			$	23,561
Credit Quality Ratios:
Provision for credit losses to average loans and leases (annualized)			0.04	%			0.04	%			0.00	%			0.08	%			0.04	%
Allowance for credit losses to net loans and leases			1.16	%			1.14	%			1.18	%			1.20	%			1.21	%
Allowance for credit losses to non-performing loans and leases			153.50	%			121.50	%			138.47	%			158.27	%			134.23	%
Allowance for credit losses to non-performing assets			139.08	%			112.84	%			123.05	%			133.82	%			118.31	%
Non-performing loans and leases to net loans and leases			0.76	%			0.94	%			0.85	%			0.76	%			0.90	%
Non-performing assets to net loans and leases			0.83	%			1.01	%			0.96	%			0.90	%			1.02	%

 

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BXS Announces First Quarter 2017 Financial Results

Page 15

April 19, 2017

 

BancorpSouth, Inc.

Selected Loan Data

(Dollars in thousands)

(Unaudited)

 

		March 31, 2017
		Pass				Special Mention				Substandard				Doubtful				Loss				Impaired				Total
LOAN PORTFOLIO BY INTERNALLY ASSIGNED GRADE:
Commercial and industrial		$	1,489,753			$	—			$	34,936			$	—			$	—			$	11,838			$	1,536,527
Real estate
Consumer mortgages			2,611,576				517				62,045				258				—				1,276				2,675,672
Home equity			615,753				—				9,881				—				—				854				626,488
Agricultural			227,902				—				8,899				141				—				3,592				240,534
Commercial and industrial-owner occupied			1,734,995				3,663				50,908				—				—				12,047				1,801,613
Construction, acquisition and development			1,124,929				—				11,621				—				—				277				1,136,827
Commercial real estate			2,216,915				—				42,614				—				—				12,013				2,271,542
Credit cards			103,813				—				—				—				—				—				103,813
All other			402,287				—				6,291				100				—				—				408,678
Total loans		$	10,527,923			$	4,180			$	227,195			$	499			$	—			$	41,897			$	10,801,694
		December 31, 2016
		Pass				Special Mention				Substandard				Doubtful				Loss				Impaired				Total
LOAN PORTFOLIO BY INTERNALLY ASSIGNED GRADE:
Commercial and industrial		$	1,562,263			$	—			$	41,618			$	100			$	—			$	8,314			$	1,612,295
Real estate
Consumer mortgages			2,579,905				522				61,602				282				—				1,655				2,643,966
Home equity			616,758				—				11,231				—				—				857				628,846
Agricultural			233,939				—				10,577				—				—				861				245,377
Commercial and industrial-owner occupied			1,705,266				3,668				47,010				—				—				8,321				1,764,265
Construction, acquisition and development			1,135,618				—				15,697				—				—				5,933				1,157,248
Commercial real estate			2,179,318				634				45,471				—				—				12,296				2,237,719
Credit cards			109,656				—				—				—				—				—				109,656
All other			405,611				—				7,008				—				—				—				412,619
Total loans		$	10,528,334			$	4,824			$	240,214			$	382			$	—			$	38,237			$	10,811,991

 

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BXS Announces First Quarter 2017 Financial Results

Page 16

April 19, 2017

 

BancorpSouth, Inc.

Geographical Information

(Dollars in thousands)

(Unaudited)

 

		March 31, 2017
		Alabama
		and Florida
		Panhandle				Arkansas				Louisiana				Mississippi				Missouri				Tennessee				Texas				Other				Total
LOAN AND LEASE PORTFOLIO:
Commercial and industrial		$	146,277			$	181,759			$	172,034			$	554,665			$	85,672			$	118,052			$	219,638			$	58,430			$	1,536,527
Real estate
Consumer mortgages			355,497				322,928				224,643				846,615				89,752				302,422				506,417				27,398				2,675,672
Home equity			95,605				44,558				71,903				230,822				21,956				144,109				15,722				1,813				626,488
Agricultural			8,540				83,664				26,241				66,060				6,568				13,501				35,927				33				240,534
Commercial and industrial-owner occupied			200,300				193,486				210,282				732,207				47,847				155,666				261,825				—				1,801,613
Construction, acquisition and development			125,908				61,890				53,512				344,875				21,592				167,290				361,760				—				1,136,827
Commercial real estate			314,657				355,978				219,715				585,549				200,684				202,476				392,068				415				2,271,542
Credit cards			—				—				—				—				—				—				—				103,813				103,813
All other			52,756				41,000				25,235				212,471				3,417				23,799				43,841				6,159				408,678
Total loans		$	1,299,540			$	1,285,263			$	1,003,565			$	3,573,264			$	477,488			$	1,127,315			$	1,837,198			$	198,061			$	10,801,694
NON-PERFORMING LOANS AND LEASES:
Commercial and industrial		$	248			$	532			$	2,449			$	5,438			$	4,554			$	105			$	842			$	142			$	14,310
Real estate
Consumer mortgages			727				4,019				1,485				11,269				813				1,782				4,444				412				24,951
Home equity			383				791				829				690				81				383				—				—				3,157
Agricultural			—				522				251				4,220				—				171				16				1				5,181
Commercial and industrial-owner occupied			1,090				2,840				1,197				7,227				3,448				511				635				—				16,948
Construction, acquisition and development			45				775				—				478				59				49				294				—				1,700
Commercial real estate			1,014				601				42				11,346				—				13				746				—				13,762
Credit cards			—				—				—				—				—				—				—				1,252				1,252
All other			16				—				2				258				—				19				6				—				301
Total loans		$	3,523			$	10,080			$	6,255			$	40,926			$	8,955			$	3,033			$	6,983			$	1,807			$	81,562
NON-PERFORMING LOANS AND LEASES AS A PERCENTAGE OF OUTSTANDING:
Commercial and industrial			0.17	%			0.29	%			1.42	%			0.98	%			5.32	%			0.09	%			0.38	%			0.24	%			0.93	%
Real estate
Consumer mortgages			0.20	%			1.24	%			0.66	%			1.33	%			0.91	%			0.59	%			0.88	%			1.50	%			0.93	%
Home equity			0.40	%			1.78	%			1.15	%			0.30	%			0.37	%			0.27	%			0.00	%			0.00	%			0.50	%
Agricultural			0.00	%			0.62	%			0.96	%			6.39	%			0.00	%			1.27	%			0.04	%			3.03	%			2.15	%
Commercial and industrial-owner occupied			0.54	%			1.47	%			0.57	%			0.99	%			7.21	%			0.33	%			0.24	%			N/A				0.94	%
Construction, acquisition and development			0.04	%			1.25	%			0.00	%			0.14	%			0.27	%			0.03	%			0.08	%			N/A				0.15	%
Commercial real estate			0.32	%			0.17	%			0.02	%			1.94	%			0.00	%			0.01	%			0.19	%			0.00	%			0.61	%
Credit cards			N/A				N/A				N/A				N/A				N/A				N/A				N/A				1.21	%			1.21	%
All other			0.03	%			0.00	%			0.01	%			0.12	%			0.00	%			0.08	%			0.01	%			0.00	%			0.07	%
Total loans			0.27	%			0.78	%			0.62	%			1.15	%			1.88	%			0.27	%			0.38	%			0.91	%			0.76	%

 

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BXS Announces First Quarter 2017 Financial Results

Page 17

April 19, 2017

 

BancorpSouth, Inc.

Noninterest Revenue and Expense

(Dollars in thousands)

(Unaudited)

 

		Quarter Ended
		Mar-17				Dec-16				Sep-16				Jun-16				Mar-16
NONINTEREST REVENUE:
Mortgage banking excl. MSR and MSR Hedge market value adj		$	8,056			$	5,561			$	9,274			$	11,978			$	9,784
MSR and MSR Hedge market value adjustment			934				11,242				1,813				(4,092	)			(7,954	)
Credit card, debit card and merchant fees			8,903				9,262				9,292				9,495				8,961
Deposit service charges			9,689				9,956				11,313				11,018				11,014
Securities gains, net			1,071				39				1				86				2
Insurance commissions			32,940				25,709				28,194				28,803				33,249
Trust income			3,561				3,874				3,641				3,493				3,430
Annuity fees			349				257				446				465				477
Brokerage commissions and fees			1,264				1,270				1,225				1,389				1,202
Bank-owned life insurance			1,669				2,104				1,775				1,813				1,893
Other miscellaneous income			2,433				2,701				2,699				4,079				2,669
Total noninterest revenue		$	70,869			$	71,975			$	69,673			$	68,526			$	64,727
NONINTEREST EXPENSE:
Salaries and employee benefits		$	81,386			$	80,850			$	80,884			$	80,675			$	81,679
Occupancy, net of rental income			10,302				10,294				10,412				10,109				10,273
Equipment			3,568				3,563				3,423				3,295				3,765
Deposit insurance assessments			2,484				1,818				3,227				2,582				2,288
Regulatory settlement			—				—				—				—				10,277
Advertising			663				2,443				925				1,043				633
Foreclosed property expense			1,050				1,005				859				1,309				1,181
Telecommunications			1,147				1,245				1,288				1,259				1,295
Public relations			720				716				718				599				661
Data processing			6,623				6,903				6,856				6,685				6,391
Computer software			2,981				3,013				2,976				2,732				2,660
Amortization of intangibles			1,030				963				923				869				880
Legal			1,229				1,190				1,064				1,754				4,535
Merger expense			—				—				—				1				1
Postage and shipping			1,175				1,075				1,059				985				1,117
Other miscellaneous expense			12,751				15,441				13,703				13,664				13,876
Total noninterest expense		$	127,109			$	130,519			$	128,317			$	127,561			$	141,512
INSURANCE COMMISSIONS:
Property and casualty commissions		$	19,755			$	19,098			$	20,927			$	20,417			$	19,877
Life and health commissions			6,465				5,757				5,897				6,252				5,615
Risk management income			648				610				674				592				623
Other			6,072				244				696				1,542				7,134
Total insurance commissions		$	32,940			$	25,709			$	28,194			$	28,803			$	33,249

 

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BXS Announces First Quarter 2017 Financial Results

Page 18

April 19, 2017

 

BancorpSouth, Inc.

Selected Additional Information

(Dollars in thousands)

(Unaudited)

 

		Quarter Ended
		Mar-17				Dec-16				Sep-16				Jun-16				Mar-16
MORTGAGE SERVICING RIGHTS:
Fair value, beginning of period		$	65,263			$	51,930			$	48,108			$	50,544			$	57,268
Additions to mortgage servicing rights:
Originations of servicing assets			2,866				4,022				4,349				3,723				2,612
Changes in fair value:
Due to payoffs/paydowns			(1,876	)			(2,447	)			(2,338	)			(2,066	)			(1,380	)
Due to change in valuation inputs or assumptions used in the valuation model			909				11,759				1,813				(4,092	)			(7,954	)
Other changes in fair value			(1	)			(1	)			(2	)			(1	)			(2	)
Fair value, end of period		$	67,161			$	65,263			$	51,930			$	48,108			$	50,544
MORTGAGE BANKING REVENUE:
Production revenue:
Origination		$	5,117			$	3,335			$	6,973			$	9,366			$	6,420
Servicing			4,815				4,673				4,639				4,678				4,744
Payoffs/Paydowns			(1,876	)			(2,447	)			(2,338	)			(2,066	)			(1,380	)
Total production revenue			8,056				5,561				9,274				11,978				9,784
Market value adjustment on MSR			909				11,759				1,813				(4,092	)			(7,954	)
Market value adjustment on MSR Hedge			25				(517	)			—				—				—
Total mortgage lending revenue		$	8,990			$	16,803			$	11,087			$	7,886			$	1,830
Mortgage loans serviced		$	6,429,617			$	6,384,649			$	6,285,027			$	6,156,258			$	6,096,220
MSR/mtg loans serviced			1.04	%			1.01	%			0.83	%			0.78	%			0.83	%
AVAILABLE-FOR-SALE SECURITIES, at fair value
U.S. Government agencies		$	1,818,180			$	1,789,427			$	1,691,866			$	1,310,803			$	1,196,167
Government agency issued residential mortgage-back securities			167,542				176,243				184,095				180,178				189,741
Government agency issued commercial mortgage-back securities			170,082				172,279				178,826				193,475				207,908
Obligations of states and political subdivisions			352,324				360,005				384,996				399,391				408,537
Other			32,759				33,722				28,416				20,036				14,020
Total available-for-sale securities		$	2,540,887			$	2,531,676			$	2,468,199			$	2,103,883			$	2,016,373

 

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BXS Announces First Quarter 2017 Financial Results

Page 19

April 19, 2017

 

BancorpSouth, Inc.

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-excluding MSR, total operating expense, tangible shareholders’ equity to tangible assets, return on tangible equity, operating return on tangible equity-excluding MSR, operating return on average assets-excluding MSR, operating return on average shareholders’ equity-excluding MSR, tangible book value per share, operating earnings per share, operating earnings per 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 and Net Operating Income-Excluding MSR to Net Income:

 

				Quarter ended
				3/31/2017				12/31/2016				9/30/2016				6/30/2016				3/31/2016
Net income				$	38,093			$	37,670			$	37,817			$	34,692			$	22,549
Plus:  Merger expense, net of tax					—				—				—				1				1
Regulatory related charges, net of tax					—				—				—				—				9,412
Less:  Security gains, net of tax					664				25				—				53				2
Net operating income				$	37,429			$	37,645			$	37,817			$	34,640			$	31,960
Less:  MSR market value adjustment, net of tax					579				6,970				1,124				(2,537	)			(4,931	)
Net operating income-excluding MSR				$	36,850			$	30,675			$	36,693			$	37,177			$	36,891
Reconciliation of Total Operating Expense to Total Noninterest Expense:
Total noninterest expense				$	127,109			$	130,519			$	128,317			$	127,561			$	141,512
Less:  Merger expense					—				—				—				1				1
Regulatory related charges					—				—				—				—				13,777
Total operating expense				$	127,109			$	130,519			$	128,317			$	127,560			$	127,734

 

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BXS Announces First Quarter 2017 Financial Results

Page 20

April 19, 2017

 

BancorpSouth, Inc.

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

(Dollars in thousands, except per share amounts)

(Unaudited)

Reconciliation of Tangible Assets and Tangible Shareholders’ Equity to

Total Assets and Total Shareholders’ Equity:

 

				Quarter ended
				3/31/2017				12/31/2016				9/30/2016				6/30/2016				3/31/2016
Tangible assets
Total assets				$	14,866,054			$	14,724,388			$	14,611,483			$	14,137,160			$	13,926,398
Less:		Goodwill			300,798				300,798				294,901				294,901				291,498
		Other identifiable intangible assets			20,865				21,894				19,908				20,831				19,664
Total tangible assets				$	14,544,391			$	14,401,696			$	14,296,674			$	13,821,428			$	13,615,236
Tangible shareholders’ equity
Total shareholders’ equity				$	1,702,389			$	1,723,883			$	1,724,104			$	1,713,043			$	1,679,793
Less:		Goodwill			300,798				300,798				294,901				294,901				291,498
		Other identifiable intangible assets			20,865				21,894				19,908				20,831				19,664
Total tangible shareholders’ equity				$	1,380,726			$	1,401,191			$	1,409,295			$	1,397,311			$	1,368,631
Total average assets				$	14,832,260			$	14,655,360			$	14,366,759			$	14,027,786			$	13,851,661
Total shares of common stock outstanding					92,344,409				93,696,687				94,074,740				94,546,091				94,438,626
Average shares outstanding-diluted					93,829,400				93,966,392				94,563,833				94,694,795				94,593,540
Tangible shareholders’ equity to tangible assets (1)					9.49	%			9.73	%			9.86	%			10.11	%			10.05	%
Return on tangible equity (2)					11.19	%			10.70	%			10.68	%			9.99	%			6.63	%
Operating return on tangible equity-excluding MSR (3)					10.82	%			8.71	%			10.36	%			10.70	%			10.84	%
Operating return on average assets-excluding MSR (4)					1.01	%			0.83	%			1.02	%			1.07	%			1.07	%
Operating return on average shareholders’ equity-excluding MSR (5)					8.63	%			7.08	%			8.49	%			8.84	%			8.89	%
Tangible book value per share (6)				$	14.95			$	14.95			$	14.98			$	14.78			$	14.49
Operating earnings per share (7)				$	0.40			$	0.40			$	0.40			$	0.37			$	0.34
Operating earnings per share-excluding MSR (8)				$	0.39			$	0.33			$	0.39			$	0.39			$	0.39

 

(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)	Return on tangible equity is defined by the Company as annualized net income divided by tangible shareholders’ equity.

(3)	Operating return on tangible equity-excluding MSR is defined by the Company as annualized net operating income-excluding MSR divided by tangible shareholders’ equity.

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

(5)	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.

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

(7)	Operating earnings per share is defined by the Company as net operating income divided by average shares outstanding-diluted.

(8)	Operating earnings per share-excluding MSR is defined by the Company as net operating income-excluding MSR divided by average 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.

 

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