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BancorpSouth Announces First Quarter 2016 Financial Results

April 20, 2016 4:30 PM EDT

TUPELO, Miss., April 20, 2016 /PRNewswire/ -- BancorpSouth, Inc. (NYSE: BXS) today announced financial results for the quarter ended March 31, 2016.

Highlights for the first quarter of 2016 included:

  • Net income of $22.5 million or $0.24 per diluted share.
  • Generated net loan growth of $71.9 million, or 2.8 percent on an annualized basis, and deposit growth of $155.5 million, or 5.5 percent on an annualized basis.
  • Incurred a total pre-tax charge of $13.8 million to reflect a probable and estimable liability associated with ongoing regulatory matters as well as related legal and consulting expense.
  • Earnings were adversely impacted by a negative mortgage servicing rights ("MSR") valuation adjustment of $8.0 million.
  • Net operating income - excluding MSR of $36.9 million or $0.39 per diluted share.
  • Continued stable credit quality; recorded provision for credit losses of $1.0 million for the quarter.
  • Net interest margin remained stable at 3.56 percent. 
  • Continued focus on controlling expenses as total noninterest expense declined compared to both the first and fourth quarters of 2015, excluding disclosed non-operating items.  

The Company reported net income of $22.5 million, or $0.24 per diluted share, for the first quarter of 2016 compared with net income of $32.3 million, or $0.33 per diluted share, for the first quarter of 2015 and net income of $21.2 million, or $0.22 per diluted share, for the fourth quarter of 2015. 

The Company reported net operating income of $32.0 million, or $0.34 per diluted share, for the first quarter of 2016 compared to $32.3 million, or $0.33 per diluted share, for the first quarter of 2015 and $31.4 million, or $0.33 per diluted share, for the fourth quarter of 2015. 

"We continue to have productive discussions with the Consumer Financial Protection Bureau and the U.S. Department of Justice regarding a settlement of their joint investigation of our fair lending practices," remarked Dan Rollins, BancorpSouth Chairman and Chief Executive Officer.  "While we continue to believe that our fair lending policies and practices are in compliance with all applicable laws and regulations, we are encouraged with the continued progress being made to resolve this matter.  Thus, even though we are unable to predict the final timing of any settlement or the impact on our pending mergers, our financial results for the first quarter reflect an estimate for a liability associated with a potential settlement.  We note, however, that should a settlement be reached, the final liability could differ materially from the current estimate.

"We also had a negative MSR valuation adjustment of $8.0 million that had an adverse impact on what was otherwise a very solid first quarter.  Otherwise, our performance metrics continue to trend in a positive direction.  We continue to maintain a very stable net interest margin while growing both sides of the balance sheet.  We recorded a provision for credit losses of $1.0 million for the quarter, marking our first recorded provision since the third quarter of 2013.  Our mortgage team had a nice quarter as well, reporting $10.6 million in production and servicing revenue and total production of $315.4 million.  Finally, our efforts to challenge expenses continue to be reflected in our financial results.  Outside of non-operating items that have been disclosed, our expense base has been stable over the past several quarters." 

Net Interest Revenue

Net interest revenue was $111.2 million for the first quarter of 2016, an increase of 4.8 percent from $106.1 million for the first quarter of 2015 and flat compared to $111.2 million for the fourth quarter of 2015.  The fully taxable equivalent net interest margin was 3.56 percent for the first quarter of 2016 compared to 3.56 percent for the first quarter of 2015 and 3.58 percent for the fourth quarter of 2015.  Yields on loans and leases were 4.21 percent for the first quarter of 2016 compared with 4.31 percent for the first quarter of 2015 and 4.15 percent for the fourth quarter of 2015, while yields on total interest earning assets were 3.78 percent for the first quarter of 2016 compared with 3.80 percent for the first quarter of 2015 and 3.79 percent for the fourth quarter of 2015.  The average cost of deposits was 0.21 percent for the first quarter of 2016 compared to 0.24 percent for the first quarter of 2015 and 0.21 percent for the fourth quarter of 2015.

Asset, Deposit and Loan Activity

Total assets were $13.9 billion at March 31, 2016 compared with $13.6 billion at March 31, 2015.  Loans and leases, net of unearned income, were $10.4 billion at March 31, 2016 compared with $9.7 billion at March 31, 2015. 

Total deposits were $11.5 billion at March 31, 2016 compared with $11.3 billion at March 31, 2015.  A decrease in time deposits of $119.3 million, or 6.1 percent, at March 31, 2016 compared to March 31, 2015 was more than offset by growth in other lower cost deposits.  Noninterest bearing demand deposits increased $188.4 million, or 6.5 percent, over the same period.  Additionally, savings deposits increased $111.1 million, or 8.0 percent, while interest bearing demand deposits increased $53.9 million, or 1.1 percent, over the same period. 

Provision for Credit Losses and Allowance for Credit Losses

Earnings for the quarter reflect a provision for credit losses of $1.0 million, compared to a negative provision of $5.0 million for the first quarter of 2015 and no recorded provision for the fourth quarter of 2015.  Total non-performing assets ("NPAs") were $106.9 million, or 1.02 percent of net loans and leases, at March 31, 2016 compared with $89.4 million, or 0.92 percent of net loans and leases, at March 31, 2015, and $109.7 million, or 1.06 percent of net loans and leases, at December 31, 2015. 

Net charge-offs for the first quarter of 2016 were $1.0 million, compared with net charge-offs of $0.8 million for the first quarter of 2015 and net charge-offs of $6.6 million for the fourth quarter of 2015.  Gross charge-offs were $3.2 million for the first quarter of 2016, compared with $4.8 million for the first quarter of 2015 and $9.5 million for the fourth quarter of 2015.  Gross recoveries of previously charged-off loans were $2.3 million for the first quarter of 2016, compared with $4.0 million for the first quarter of 2015 and $3.0 million for the fourth quarter of 2015.  Annualized net charge-offs were 0.04 percent of average loans and leases for the first quarter of 2016, compared with annualized net charge-offs of 0.03 percent for the first quarter of 2015 and annualized net charge-offs of 0.25 percent for the fourth quarter of 2015. 

Non-performing loans ("NPLs") were $94.2 million, or 0.90 percent of net loans and leases, at March 31, 2016, compared with $61.5 million, or 0.63 percent of net loans and leases, at March 31, 2015, and $95.0 million, or 0.92 percent of net loans and leases, at December 31, 2015.  The allowance for credit losses was $126.5 million, or 1.21 percent of net loans and leases, at March 31, 2016 compared with $136.7 million, or 1.40 percent of net loans and leases, at March 31, 2015 and $126.5 million, or 1.22 percent of net loans and leases, at December 31, 2015. 

NPLs at March 31, 2016 consisted primarily of $81.9 million of nonaccrual loans, compared with $83.0 million of nonaccrual loans at December 31, 2015.  NPLs at March 31, 2016 also included $4.6 million of loans 90 days or more past due and still accruing, compared with $2.0 million of such loans at December 31, 2015, and included restructured loans still accruing of $7.8 million at March 31, 2016, compared with $9.9 million of such loans at December 31, 2015.  Early stage past due loans, representing loans 30-89 days past due, totaled $23.6 million at March 31, 2016 compared to $24.6 million at December 31, 2015.  Other real estate owned decreased $2.1 million to $12.7 million during the first quarter of 2016 from $14.8 million at December 31, 2015. 

Noninterest Revenue

Noninterest revenue was $65.5 million for the first quarter of 2016, compared with $73.3 million for the first quarter of 2015 and $67.4 million for the fourth quarter of 2015.  These results included a negative MSR valuation adjustment of $8.0 million for the first quarter of 2016 compared with a negative MSR valuation adjustment of $3.0 million for the first quarter of 2015 and a positive MSR valuation adjustment of $2.9 million for the fourth quarter of 2015.  Valuation adjustments in the MSR asset are driven primarily by fluctuations in interest rates period over period.   

Excluding the MSR valuation adjustments, net mortgage lending revenue was $10.6 million for the first quarter of 2016, compared with $11.6 million for the first quarter of 2015 and $7.7 million for the fourth quarter of 2015.  Mortgage origination volume for the first quarter of 2016 was $315.4 million, compared with $311.1 million for the first quarter of 2015 and $310.0 million for the fourth quarter of 2015.

Credit and debit card fee revenue was $9.0 million for the first quarter of 2016, compared with $8.5 million for the first quarter of 2015 and $9.4 million for the fourth quarter of 2015.  Deposit service charge revenue was $11.0 million for the first quarter of 2016, compared with $11.3 million for the first quarter of 2015 and $11.8 million for the fourth quarter of 2015.  Insurance commission revenue was $33.2 million for the first quarter of 2016, compared with $33.5 million for the first quarter of 2015 and $25.3 million for the fourth quarter of 2015.  Wealth management revenue was $5.1 million for the first quarter of 2016, compared with $6.2 million for the first quarter of 2015 and $5.4 million for the fourth quarter of 2015.    

Noninterest Expense

Noninterest expense for the first quarter of 2016 was $142.3 million, compared with $136.9 million for the first quarter of 2015 and $148.4 million for the fourth quarter of 2015.  Salaries and employee benefits expense was $82.5 million for the first quarter of 2016 compared to $81.2 million for the first quarter of 2015 and $80.2 million for the fourth quarter of 2015.  Occupancy expense was $10.3 million for the first quarter of 2016 compared with $10.2 million for the first quarter of 2015 and $10.4 million for the fourth quarter of 2015.  Other noninterest expense was $33.2 million for the first quarter of 2016 compared to $39.3 million for the first quarter of 2015 and $51.5 million for the fourth quarter of 2015.  Total noninterest expense for the first quarter of 2016 included a total charge of $13.8 million to reflect a probable and estimable liability associated with ongoing regulatory matters, $10.3 million of which is reflected as regulatory settlement expense and $3.5 million of which is included in other noninterest expense.  Other noninterest expense for the fourth quarter of 2015 included the $16.5 million legal charge related to the settlement of the class action lawsuit related to overdraft fees.    

Capital Management

The Company's equity capitalization is comprised entirely of common stock.  BancorpSouth's ratio of shareholders' equity to assets was 12.06 percent at March 31, 2016, compared with 12.07 percent at March 31, 2015 and 12.00 percent at December 31, 2015.  The ratio of tangible shareholders' equity to tangible assets was 10.05 percent at March 31, 2016, compared with 9.99 percent at March 31, 2015 and 9.96 percent at December 31, 2015.

Estimated regulatory capital ratios at March 31, 2016 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 12.34 percent at March 31, 2016 and total risk based capital of 13.43 percent, compared with required minimum levels of 8 percent and 10 percent, respectively, for "well capitalized" classification. 

Transactions

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. will 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, 2016, OIB, on a consolidated basis, reported total assets of $672.3 million, total loans of $456.8 million and total deposits of $575.7 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 OIB shareholders on April 8, 2014.  On February 25, 2015, the Company re-filed the merger application for the merger with Ouachita Bancshares Corp. with the appropriate regulatory agencies.  On June 30, 2015, the Company announced the merger agreement was extended through December 31, 2015 to allow for additional time to obtain the necessary regulatory approvals and to satisfy all closing conditions.  Although the merger agreement has not been extended beyond December 31, 2015, the amended agreement remains in effect until terminated by the Board of Directors of the Company or OIB.  The terms of the amended 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.

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 will 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, 2016, Central Community Corporation, on a consolidated basis, reported total assets of $1.5 billion, total loans of $614.6 million and total deposits of $1.2 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.  On February 25, 2015, the Company re-filed the merger application for the merger with Central Community Corporation with the appropriate regulatory agencies.  On June 30, 2015, the Company announced the merger agreement was extended through December 31, 2015 to allow for additional time to obtain the necessary regulatory approvals and to satisfy all closing conditions.  Although the merger agreement has not been extended beyond December 31, 2015, the amended agreement remains in effect until terminated by the Board of Directors of the Company or Central Community Corporation.  The terms of the amended 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.

For the most recent information regarding the status of the merger with Ouachita Bancshares Corp. and the status of the merger with Central Community Corporation in our periodic reports, please refer to the section titled "Recent Acquisitions and Transaction Activity" in Part I, Item 1, and Part I, Item 1A, of the Annual Report on Form 10-K that was previously filed with the SEC on February 23, 2016.

Summary

Rollins concluded, "Our financial results reflect steady improvement in our core operating performance quarter after quarter.  Our bankers are growing loans and deposits, our mortgage lenders continue to grow home purchase money, and our insurance producers are working diligently to grow their customer base to help offset industry pricing headwinds.  Importantly, we are achieving this growth while holding operating expenses relatively flat.  As we look forward, I'm confident the simple formula of growing customers and challenging expenses will allow us to continue to improve our operating results."

Conference Call

BancorpSouth will conduct a conference call to discuss its first quarter 2016 results on April 21, 2016, at 10:00 a.m. (Central Time).  Investors may listen via the Internet by accessing BancorpSouth's website at http://www.bancorpsouth.com.  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. is a financial holding company headquartered in Tupelo, Mississippi, with $13.9 billion in assets.  BancorpSouth Bank, a wholly-owned subsidiary of BancorpSouth, Inc., operates 239 full service branch locations as well additional mortgage, insurance, and loan production offices in Alabama, Arkansas, Florida, Louisiana, Mississippi, Missouri, Tennessee and Texas, including an insurance location in Illinois.

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 Company's ability to operate its regulatory compliance programs consistent with federal, state and local laws, including its BSA/AML compliance program, the terms, timing and outcome of the settlement discussions in connection with the joint investigation by the Consumer Financial Protection Bureau (the "CFPB") and the United States Department of Justice ("DOJ") of the Company's fair lending practices, 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 outcome of any instituted, pending or threatened material litigation, amortization expense for intangible assets, goodwill impairments, loan 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, additions to OREO, credit quality, credit losses, liquidity, off-balance sheet commitments and arrangements, valuation of mortgage servicing rights, allowance and provision for credit losses, continued weakness in the economic environment, 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, troubled debt restructurings, diversification of the Company's revenue stream, liquidity needs and strategies, sources of funding, net interest margin, declaration and payment of dividends, 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, when and whether the joint investigation by the CFPB and the DOJ of the Company's fair lending practices is resolved by settlement and, if so, on what terms, the ability of the Company, Ouachita Bancshares Corp. and Central Community Corporation to obtain regulatory approval of and close 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, losses resulting from the significant amount of the Company's OREO, 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 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, 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.

 

BancorpSouth, Inc.

Selected Financial Information

(Dollars in thousands, except per share data)

(Unaudited)

Quarter Ended

Quarter Ended

Quarter Ended

Quarter Ended

Quarter Ended

3/31/2016

12/31/2015

9/30/2015

6/30/2015

3/31/2015

Earnings Summary:

Interest revenue

$            117,972

$             118,050

$            118,201

$            114,630

$            113,497

Interest expense

6,813

6,820

7,131

7,321

7,424

Net interest revenue

111,159

111,230

111,070

107,309

106,073

Provision for credit losses

1,000

-

(3,000)

(5,000)

(5,000)

Net interest revenue, after provision

   for credit losses

110,159

111,230

114,070

112,309

111,073

Noninterest revenue

65,515

67,386

62,953

74,314

73,315

Noninterest expense

142,300

148,351

126,450

128,177

136,933

Income before income taxes

33,374

30,265

50,573

58,446

47,455

Income tax expense

10,825

9,096

16,230

18,733

15,189

Net income

$              22,549

$               21,169

$              34,343

$              39,713

$              32,266

Balance Sheet - Period End Balances

Total assets

$       13,926,398

$        13,798,662

$       13,787,424

$       13,634,931

$       13,630,322

Total earning assets

12,760,031

12,656,791

12,663,944

12,492,532

12,468,322

Total securities

2,016,373

2,082,329

2,161,125

2,251,153

2,194,373

Loans and leases, net of unearned income

10,444,697

10,372,778

10,219,576

10,007,571

9,726,970

Allowance for credit losses

126,506

126,458

133,009

138,312

136,660

Total deposits

11,486,697

11,331,161

11,141,946

11,134,961

11,252,654

Long-term debt

67,681

69,775

71,868

73,962

76,055

Total shareholders' equity

1,679,793

1,655,444

1,644,820

1,680,196

1,645,208

Balance Sheet - Average Balances

Total assets

$       13,851,661

$        13,724,595

$       13,632,581

$       13,516,546

$       13,457,668

Total earning assets

12,830,000

12,628,685

12,548,967

12,443,960

12,398,058

Total securities

2,037,739

2,110,195

2,207,935

2,211,931

2,190,989

Loans and leases, net of unearned income

10,372,925

10,321,299

10,110,995

9,868,318

9,670,987

Total deposits

11,431,480

11,182,750

11,140,542

11,148,246

11,126,210

Long-term debt

67,750

69,775

71,868

73,962

76,078

Total shareholders' equity

1,668,465

1,650,924

1,680,123

1,659,991

1,624,496

Nonperforming Assets:

Non-accrual loans and leases

$              81,926

$               83,028

$              70,237

$              67,766

$              54,418

Loans and leases 90+ days past due, still accruing

4,567

2,013

1,436

1,568

1,615

Restructured loans and leases, still accruing

7,753

9,876

18,578

10,109

5,433

Non-performing loans (NPLs)

94,246

94,917

90,251

79,443

61,466

Other real estate owned

12,685

14,759

23,696

24,299

27,889

Non-performing assets (NPAs)

$            106,931

$             109,676

$            113,947

$            103,742

$              89,355

Financial Ratios and Other Data:

Return on average assets

0.65%

0.61%

1.00%

1.18%

0.97%

Return on average shareholders' equity

5.44%

5.09%

8.11%

9.60%

8.06%

Noninterest income to average assets

1.90%

1.95%

1.83%

2.21%

2.21%

Noninterest expense to average assets

4.13%

4.29%

3.68%

3.80%

4.13%

Net interest margin-fully taxable equivalent

3.56%

3.58%

3.59%

3.54%

3.56%

Net interest rate spread

3.47%

3.48%

3.49%

3.44%

3.46%

Loan/deposit ratio

90.93%

91.54%

91.72%

89.88%

86.44%

Price to earnings mult (avg)

17.33

18.17

16.98

18.80

18.43

Market value to book value

119.81%

136.46%

135.80%

148.34%

136.26%

Market value to book value (avg)

116.78%

142.53%

140.68%

142.10%

127.91%

Market value to tangible book value

147.04%

168.15%

167.71%

182.42%

168.52%

Market value to tangible book value (avg)

143.33%

175.64%

173.74%

174.75%

158.20%

Headcount FTE

3,966

3,970

3,903

3,935

3,924

Non-GAAP Financial Ratios:

Operating return on average assets-excluding MSR

1.07%

0.86%

1.09%

1.10%

1.03%

Operating return on average shareholders' equity-excluding MSR

8.89%

7.12%

8.88%

8.94%

8.52%

Return on tangible equity

6.63%

6.25%

10.23%

11.66%

9.84%

Operating return on tangible equity-excluding MSR

10.84%

8.75%

11.21%

10.87%

10.41%

Efficiency ratio (tax equivalent)

79.39%

81.86%

71.56%

69.52%

75.17%

Operating efficiency ratio-excluding MSR (tax equivalent)

68.66%

73.89%

69.45%

71.16%

73.93%

Credit Quality Ratios:

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

0.04%

0.25%

0.09%

(0.27%)

0.03%

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

0.04%

0.00%

(0.12%)

(0.20%)

(0.21%)

Allowance for credit losses to net loans and leases

1.21%

1.22%

1.30%

1.38%

1.40%

Allowance for credit losses to non-performing loans and leases

134.23%

133.23%

147.38%

174.10%

222.33%

Allowance for credit losses to non-performing assets

118.31%

115.30%

116.73%

133.32%

152.94%

Non-performing loans and leases to net loans and leases

0.90%

0.92%

0.88%

0.79%

0.63%

Non-performing assets to net loans and leases

1.02%

1.06%

1.11%

1.04%

0.92%

Equity Ratios:

Total shareholders' equity to total assets

12.06%

12.00%

11.93%

12.32%

12.07%

Tangible shareholders' equity to tangible assets

10.05%

9.96%

9.88%

10.26%

9.99%

Capital Adequacy:

Common  Equity Tier 1 capital

12.14%

12.07%

12.08%

12.60%

12.60%

Tier 1 capital

12.34%

12.27%

12.29%

12.81%

12.81%

Total capital

13.43%

13.37%

13.45%

14.04%

14.07%

Tier 1 leverage capital

10.61%

10.61%

10.56%

10.96%

10.71%

   Estimated for current quarter

Common Share Data:

Basic earnings per share

$                  0.24

$                   0.22

$                  0.36

$                  0.41

$                  0.33

Diluted earnings per share

0.24

0.22

0.36

0.41

0.33

Cash dividends per share

0.10

0.10

0.10

0.08

0.08

Book value per share

17.79

17.58

17.50

17.37

17.04

Tangible book value per share

14.49

14.27

14.17

14.12

13.78

Market value per share (last)

21.31

23.99

23.77

25.76

23.22

Market value per share (high)

23.64

27.23

26.54

26.68

23.68

Market value per share (low)

18.69

22.44

22.09

22.83

19.64

Market value per share (avg)

20.77

25.06

24.62

24.68

21.80

Dividend payout ratio

41.85%

44.46%

28.01%

18.25%

22.40%

Total shares outstanding

94,438,626

94,162,728

93,969,994

96,755,530

96,544,502

Average shares outstanding - basic

94,369,211

94,111,408

96,202,871

96,625,794

96,359,885

Average shares outstanding - diluted

94,593,540

94,384,443

96,467,728

96,957,441

96,653,401

Yield/Rate:

(Taxable equivalent basis)

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

4.21%

4.15%

4.22%

4.23%

4.31%

Available-for-sale securities:

  Taxable

1.40%

1.48%

1.40%

1.40%

1.54%

  Tax-exempt

5.36%

5.32%

5.32%

5.44%

5.40%

Short-term investments

0.33%

0.22%

0.20%

0.24%

0.22%

  Total interest earning assets and revenue

3.78%

3.79%

3.82%

3.78%

3.80%

Deposits

0.21%

0.21%

0.22%

0.23%

0.24%

  Demand - interest bearing

0.17%

0.18%

0.18%

0.19%

0.18%

  Savings

0.12%

0.12%

0.12%

0.12%

0.12%

  Other time

0.73%

0.71%

0.76%

0.79%

0.82%

Short-term borrowings

0.14%

0.12%

0.12%

0.11%

0.12%

Total int bearing dep & s/t borrowings

0.28%

0.28%

0.30%

0.31%

0.31%

Junior subordinated debt

3.18%

2.93%

2.87%

2.86%

2.84%

Long-term debt

3.08%

2.95%

2.91%

2.90%

2.88%

  Total interest bearing liabilities and expense

0.31%

0.31%

0.32%

0.34%

0.34%

Interest bearing liabilities to interest earning assets

69.75%

69.23%

69.68%

70.36%

71.13%

Net interest tax equivalent adjustment

$                2,558

$                 2,601

$                2,558

$                2,628

$                2,653

 

BancorpSouth, Inc.

Consolidated Balance Sheets

(Unaudited)

Mar-16

Dec-15

Sep-15

Jun-15

Mar-15

(Dollars in thousands)

Assets

Cash and due from banks

$                197,538

$                154,192

$                159,923

$                183,541

$                199,337

Interest bearing deposits with other banks

148,915

43,777

113,068

34,438

360,469

Available-for-sale securities, at fair value

2,016,373

2,082,329

2,161,125

2,251,153

2,194,373

Loans and leases

10,475,528

10,404,326

10,254,013

10,041,455

9,761,555

  Less:  Unearned income

30,831

31,548

34,437

33,884

34,585

             Allowance for credit losses

126,506

126,458

133,009

138,312

136,660

Net loans and leases

10,318,191

10,246,320

10,086,567

9,869,259

9,590,310

Loans held for sale

150,046

157,907

170,175

199,370

186,510

Premises and equipment, net

306,765

308,125

304,317

303,837

305,335

Accrued interest receivable

41,401

40,901

41,599

41,065

42,933

Goodwill

291,498

291,498

291,498

291,498

291,498

Other identifiable intangibles

19,664

20,545

21,466

22,415

23,476

Bank owned life insurance

253,427

251,534

249,825

247,983

246,148

Other real estate owned

12,685

14,759

23,696

24,299

27,889

Other assets

169,895

186,775

164,165

166,073

162,044

Total Assets

$           13,926,398

$           13,798,662

$           13,787,424

$           13,634,931

$           13,630,322

Liabilities

Deposits:

  Demand:  Noninterest bearing

$             3,103,321

$             3,031,528

$             3,053,439

$             2,911,972

$             2,914,949

                  Interest bearing

5,033,565

5,003,806

4,794,656

4,881,469

4,979,710

  Savings

1,506,942

1,442,336

1,409,856

1,407,616

1,395,857

  Other time

1,842,869

1,853,491

1,883,995

1,933,904

1,962,138

Total deposits

11,486,697

11,331,161

11,141,946

11,134,961

11,252,654

Federal funds purchased and

    securities sold under agreement

    to repurchase

431,089

405,937

425,203

375,980

384,829

Short-term Federal Home Loan Bank borrowings

   and other short-term borrowing

-

62,000

224,500

92,500

1,500

Accrued interest payable

3,305

3,071

3,353

3,494

3,371

Junior subordinated debt securities

23,198

23,198

23,198

23,198

23,198

Long-term debt

67,681

69,775

71,868

73,962

76,055

Other liabilities

234,635

248,076

252,536

250,640

243,507

Total Liabilities

12,246,605

12,143,218

12,142,604

11,954,735

11,985,114

Shareholders' Equity

Common stock

236,097

235,407

234,925

241,889

241,361

Capital surplus

283,800

282,934

278,998

337,272

331,016

Accumulated other comprehensive loss

(32,144)

(41,825)

(36,355)

(41,288)

(37,033)

Retained earnings

1,192,040

1,178,928

1,167,252

1,142,323

1,109,864

Total Shareholders' Equity

1,679,793

1,655,444

1,644,820

1,680,196

1,645,208

Total Liabilities & Shareholders' Equity

$           13,926,398

$           13,798,662

$           13,787,424

$           13,634,931

$           13,630,322

 

BancorpSouth, Inc.

Consolidated Average Balance Sheets

(Unaudited)

Mar-16

Dec-15

Sep-15

Jun-15

Mar-15

(Dollars in thousands)

Assets

Cash and due from banks

$                  71,528

$                159,696

$                159,569

$                152,792

$                132,734

Interest bearing deposits with other banks

316,108

69,552

72,438

212,634

426,792

Available-for-sale securities, at fair value

2,037,739

2,110,195

2,207,935

2,211,931

2,190,989

Loans and leases

10,405,063

10,353,913

10,144,874

9,903,034

9,706,941

  Less:  Unearned income

32,138

32,614

33,879

34,716

35,954

             Allowance for credit losses

126,567

132,375

137,547

140,483

141,299

Net loans and leases

10,246,358

10,188,924

9,973,448

9,727,835

9,529,688

Loans held for sale

103,227

127,638

157,598

151,077

109,291

Premises and equipment, net

308,065

306,881

304,948

305,335

305,277

Accrued interest receivable

38,306

38,142

38,847

38,268

39,279

Goodwill

291,498

291,498

291,498

291,498

291,498

Other identifiable intangibles

19,987

20,880

21,812

22,780

23,834

Bank owned life insurance

252,422

250,577

248,798

246,872

246,538

Other real estate owned

14,523

21,049

24,008

27,190

32,062

Other assets

151,900

139,563

131,682

128,334

129,686

Total Assets

$           13,851,661

$           13,724,595

$           13,632,581

$           13,516,546

$           13,457,668

Liabilities

Deposits:

  Demand:  Noninterest bearing

$             3,014,896

$             3,106,947

$             2,992,903

$             2,895,451

$             2,807,816

                  Interest bearing

5,102,648

4,782,234

4,822,567

4,899,467

4,985,577

  Savings

1,468,262

1,421,361

1,413,187

1,404,336

1,358,565

  Other time

1,845,674

1,872,208

1,911,885

1,948,992

1,974,252

Total deposits

11,431,480

11,182,750

11,140,542

11,148,246

11,126,210

Federal funds purchased and

    securities sold under agreement

    to repurchase

431,260

466,865

439,503

399,447

398,237

Short-term Federal Home Loan Bank borrowings

   and other short-term borrowing

10,484

107,408

62,136

6,555

3,056

Accrued interest payable

3,248

3,340

3,600

3,457

3,338

Junior subordinated debt securities

23,198

23,198

23,198

23,198

23,198

Long-term debt

67,750

69,775

71,868

73,962

76,078

Other liabilities

215,776

220,335

211,611

201,690

203,055

Total Liabilities

12,183,196

12,073,671

11,952,458

11,856,555

11,833,172

Shareholders' Equity

Common stock

235,946

235,227

240,473

241,540

240,992

Capital surplus

282,796

282,076

325,118

332,993

326,476

Accumulated other comprehensive loss

(36,184)

(38,618)

(40,476)

(38,534)

(39,529)

Retained earnings

1,185,907

1,172,239

1,155,008

1,123,992

1,096,557

Total Shareholders' Equity

1,668,465

1,650,924

1,680,123

1,659,991

1,624,496

Total Liabilities & Shareholders' Equity

$           13,851,661

$           13,724,595

$           13,632,581

$           13,516,546

$           13,457,668

 

BancorpSouth, Inc.

Consolidated Condensed Statements of Income

(Dollars in thousands, except per share data)

(Unaudited)

Quarter Ended

YTD

Mar-16

Dec-15

Sep-15

Jun-15

Mar-15

Mar-16

Mar-15

INTEREST REVENUE:

Loans and leases

$  107,805

$  107,164

$   107,086

$  103,428

$  102,135

$ 107,805

$ 102,135

Deposits with other banks

263

40

36

126

236

263

236

Available-for-sale securities:

    Taxable

5,888

6,550

6,490

6,424

6,844

5,888

6,844

    Tax-exempt

3,032

3,137

3,226

3,335

3,377

3,032

3,377

Loans held for sale

984

1,159

1,363

1,317

905

984

905

        Total interest revenue

117,972

118,050

118,201

114,630

113,497

117,972

113,497

INTEREST EXPENSE:

Interest bearing demand

2,163

2,166

2,209

2,262

2,183

2,163

2,183

Savings

443

434

431

426

412

443

412

Other time

3,354

3,356

3,646

3,827

4,008

3,354

4,008

Federal funds purchased and securities sold

   under agreement to repurchase

140

112

104

85

82

140

82

Long-term debt

530

581

571

556

577

530

577

Junior subordinated debt

183

171

168

165

163

183

163

Other

-

-

2

-

(1)

-

(1)

        Total interest expense

6,813

6,820

7,131

7,321

7,424

6,813

7,424

        Net interest revenue

111,159

111,230

111,070

107,309

106,073

111,159

106,073

  Provision for credit losses

1,000

-

(3,000)

(5,000)

(5,000)

1,000

(5,000)

        Net interest revenue, after provision for

          credit losses

110,159

111,230

114,070

112,309

111,073

110,159

111,073

NONINTEREST REVENUE:

Mortgage lending

2,618

10,522

2,339

14,102

8,567

2,618

8,567

Credit card, debit card and merchant fees

8,961

9,414

9,282

9,298

8,539

8,961

8,539

Deposit service charges

11,014

11,836

12,150

11,527

11,252

11,014

11,252

Security gains, net

2

48

33

41

14

2

14

Insurance commissions

33,249

25,348

28,584

29,319

33,493

33,249

33,493

Wealth Management

5,109

5,375

5,567

5,508

6,210

5,109

6,210

Other

4,562

4,843

4,998

4,519

5,240

4,562

5,240

        Total noninterest revenue

65,515

67,386

62,953

74,314

73,315

65,515

73,315

NONINTEREST EXPENSE:

Salaries and employee benefits

82,467

80,177

81,354

79,759

81,179

82,467

81,179

Occupancy, net of rental income

10,273

10,434

10,819

10,419

10,194

10,273

10,194

Equipment

3,765

3,569

3,742

4,024

3,974

3,765

3,974

Deposit insurance assessments

2,288

2,630

2,191

2,377

2,311

2,288

2,311

Regulatory settlement

10,277

-

-

-

-

10,277

-

Other

33,230

51,541

28,344

31,598

39,275

33,230

39,275

        Total noninterest expenses

142,300

148,351

126,450

128,177

136,933

142,300

136,933

        Income before income taxes

33,374

30,265

50,573

58,446

47,455

33,374

47,455

Income tax expense

10,825

9,096

16,230

18,733

15,189

10,825

15,189

        Net income

$    22,549

$   21,169

$     34,343

$    39,713

$   32,266

$  22,549

$  32,266

Net income per share: Basic

$       0.24

$       0.22

$        0.36

$       0.41

$       0.33

$      0.24

$      0.33

                                  Diluted

$       0.24

$       0.22

$        0.36

$       0.41

$       0.33

$      0.24

$      0.33

 

BancorpSouth, Inc.

Selected Loan Data

(Dollars in thousands)

(Unaudited)

Quarter Ended

Mar-16

Dec-15

Sep-15

Jun-15

Mar-15

LOAN AND LEASE PORTFOLIO:

Commercial and industrial

$  1,716,477

$   1,747,774

$   1,710,497

$    1,730,142

$ 1,676,366

Real estate

   Consumer mortgages

2,480,828

2,472,202

2,447,132

2,374,122

2,301,112

   Home equity

605,228

589,752

573,566

558,460

538,042

   Agricultural

239,422

259,360

252,381

239,884

236,898

   Commercial and industrial-owner occupied

1,654,577

1,617,429

1,605,811

1,596,244

1,518,153

   Construction, acquisition and development

966,362

945,045

900,875

860,407

892,730

   Commercial real estate

2,233,742

2,188,048

2,141,398

2,081,394

1,993,473

Credit cards

106,714

112,165

109,576

110,552

106,287

All other

441,347

441,003

478,340

456,366

463,909

     Total loans

$ 10,444,697

$ 10,372,778

$ 10,219,576

$  10,007,571

$ 9,726,970

ALLOWANCE FOR CREDIT LOSSES:

Balance, beginning of period

$     126,458

$      133,009

$     138,312

$       136,660

$   142,443

Loans and leases charged-off:

Commercial and industrial

(140)

(6,193)

(2,010)

(1,436)

(383)

Real estate

   Consumer mortgages

(710)

(1,146)

(1,382)

(575)

(892)

   Home equity

(550)

(147)

(314)

(245)

(498)

   Agricultural

(11)

(16)

(9)

-

(8)

   Commercial and industrial-owner occupied

(154)

(357)

(645)

(404)

(394)

   Construction, acquisition and development

(226)

(221)

(203)

(272)

(343)

   Commercial real estate

(245)

(122)

(1,477)

(1,117)

(1,007)

Credit cards

(720)

(723)

(706)

(527)

(676)

All other

(487)

(623)

(628)

(441)

(579)

     Total loans charged-off

(3,243)

(9,548)

(7,374)

(5,017)

(4,780)

Recoveries:

Commercial and industrial

212

354

897

282

502

Real estate

   Consumer mortgages

455

596

461

1,024

612

   Home equity

80

123

90

185

241

   Agricultural

36

20

59

36

269

   Commercial and industrial-owner occupied

125

307

1,831

146

550

   Construction, acquisition and development

272

1,061

1,084

8,978

604

   Commercial real estate

683

149

187

600

720

Credit cards

181

152

170

183

153

All other

247

235

292

235

346

     Total recoveries

2,291

2,997

5,071

11,669

3,997

Net (charge-offs) recoveries

(952)

(6,551)

(2,303)

6,652

(783)

Provision charged to operating expense

1,000

-

(3,000)

(5,000)

(5,000)

Balance, end of period

$ 126,506

$ 126,458

$     133,009

$       138,312

$   136,660

Average loans for period

$ 10,372,925

$ 10,321,299

$ 10,110,995

$    9,868,318

$ 9,670,987

Ratio:

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

0.04%

0.25%

0.09%

(0.27%)

0.03%

 

BancorpSouth, Inc.

Selected Loan Data

(Dollars in thousands)

(Unaudited)

Quarter Ended

Mar-16

Dec-15

Sep-15

Jun-15

Mar-15

NON-PERFORMING ASSETS

NON-PERFORMING LOANS AND LEASES:

  Nonaccrual Loans and Leases

    Commercial and industrial

$    10,248

$         8,493

$       15,697

$      9,740

$         3,923

    Real estate

       Consumer mortgages

22,968

21,637

21,959

21,636

21,435

       Home equity

3,564

4,021

3,664

3,550

2,269

       Agricultural

932

921

484

259

259

       Commercial and industrial-owner occupied

16,633

16,512

12,690

14,007

9,687

       Construction, acquisition and development

7,720

9,130

4,240

5,411

5,111

       Commercial real estate

19,417

21,741

10,730

12,397

11,107

    Credit cards

188

188

215

157

118

    All other

256

385

558

609

509

         Total nonaccrual loans and leases

$    81,926

$       83,028

$       70,237

$    67,766

$       54,418

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

4,567

2,013

1,436

1,568

1,615

  Restructured Loans and Leases, Still Accruing

7,753

9,876

18,578

10,109

5,433

     Total non-performing loans and leases

94,246

94,917

90,251

79,443

61,466

OTHER REAL ESTATE OWNED:

12,685

14,759

23,696

24,299

27,889

Total Non-performing Assets

$  106,931

$      109,676

$      113,947

$  103,742

$       89,355

Additions to Nonaccrual Loans and Leases During the Quarter

$    15,933

$       34,050

$       22,271

$    35,315

$       23,607

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

    Commercial and industrial

$      3,758

$         2,409

$         4,985

$      3,081

$         3,270

    Real estate

       Consumer mortgages

11,985

15,128

10,789

10,622

9,955

       Home equity

2,414

2,456

1,455

2,527

2,594

       Agricultural

240

303

393

116

161

       Commercial and industrial-owner occupied

669

1,018

3,888

2,643

3,026

       Construction, acquisition and development

1,489

1,070

1,218

1,120

5,471

       Commercial real estate

1,831

830

798

1,651

3,032

    Credit cards

569

677

788

529

581

    All other

606

744

1,334

1,481

1,014

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

$    23,561

$       24,635

$       25,648

$    23,770

$       29,104

Credit Quality Ratios:

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

0.04%

0.00%

(0.12%)

(0.20%)

(0.21%)

Allowance for credit losses to net loans and leases

1.21%

1.22%

1.30%

1.38%

1.40%

Allowance for credit losses to non-performing loans and leases

134.23%

133.23%

147.38%

174.10%

222.33%

Allowance for credit losses to non-performing assets

118.31%

115.30%

116.73%

133.32%

152.94%

Non-performing loans and leases to net loans and leases

0.90%

0.92%

0.88%

0.79%

0.63%

Non-performing assets to net loans and leases

1.02%

1.06%

1.11%

1.04%

0.92%

 

BancorpSouth, Inc.

Selected Loan Data

(Dollars in thousands)

(Unaudited)

March 31, 2016

Special

Pass

Mention

Substandard

Doubtful

Loss

Impaired

Total

LOAN PORTFOLIO BY INTERNALLY ASSIGNED GRADE:

Commercial and industrial

$  1,672,249

$                -

$       35,633

$        394

$                -

$    8,201

$   1,716,477

Real estate

   Consumer mortgages

2,407,869

-

69,215

11

-

3,733

2,480,828

   Home equity

593,500

-

9,938

-

-

1,790

605,228

   Agricultural

229,935

-

8,632

-

-

855

239,422

   Commercial and industrial-owner occupied

1,595,424

-

47,293

-

-

11,860

1,654,577

   Construction, acquisition and development

944,533

-

15,908

-

-

5,921

966,362

   Commercial real estate

2,166,616

-

49,440

400

-

17,286

2,233,742

Credit cards

106,714

-

-

-

-

-

106,714

All other

436,409

-

4,838

100

-

-

441,347

     Total loans

$ 10,153,249

$                -

$      240,897

$        905

$                -

$  49,646

$ 10,444,697

December 31, 2015

Special

Pass

Mention

Substandard

Doubtful

Loss

Impaired

Total

LOAN PORTFOLIO BY INTERNALLY ASSIGNED GRADE:

Commercial and industrial

$  1,721,118

$                -

$       19,529

$            -

$                -

$    7,127

$   1,747,774

Real estate

   Consumer mortgages

2,399,081

-

68,768

363

-

3,990

2,472,202

   Home equity

577,539

-

10,418

-

-

1,795

589,752

   Agricultural

250,579

-

7,909

-

-

872

259,360

   Commercial and industrial-owner occupied

1,554,984

-

50,304

-

-

12,141

1,617,429

   Construction, acquisition and development

920,372

-

17,090

-

-

7,583

945,045

   Commercial real estate

2,124,448

-

45,658

161

-

17,781

2,188,048

Credit cards

112,165

-

-

-

-

-

112,165

All other

433,333

-

7,465

102

-

103

441,003

     Total loans

$ 10,093,619

$                -

$      227,141

$        626

$                -

$  51,392

$ 10,372,778

 

BancorpSouth, Inc.

Geographical Information

(Dollars in thousands)

(Unaudited)

March 31, 2016

Alabama

and Florida

Panhandle

Arkansas

Louisiana

Mississippi

Missouri

Tennessee

Texas

Other

Total

LOAN AND LEASE PORTFOLIO:

Commercial and industrial

$   150,326

$   188,911

$   197,183

$   702,459

$     87,479

$   120,117

$   224,543

$     45,459

$  1,716,477

Real estate

   Consumer mortgages

298,267

327,457

221,327

805,657

76,343

277,477

454,925

19,375

2,480,828

   Home equity

91,297

41,653

65,239

223,097

23,336

144,591

14,238

1,777

605,228

   Agricultural

7,714

82,747

26,854

67,290

3,196

12,274

39,347

-

239,422

   Commercial and industrial-owner occupied

200,951

179,923

197,650

677,771

56,581

134,104

207,597

-

1,654,577

   Construction, acquisition and development

114,795

104,591

66,009

308,487

23,923

140,730

207,826

1

966,362

   Commercial real estate

339,339

362,449

244,741

599,878

198,505

179,555

309,275

-

2,233,742

Credit cards

-

-

-

-

-

-

-

106,714

106,714

All other

66,946

49,535

30,177

177,429

3,066

37,723

54,958

21,513

441,347

     Total loans

$ 1,269,635

$ 1,337,266

$ 1,049,180

$3,562,068

$   472,429

$ 1,046,571

$ 1,512,709

$   194,839

$ 10,444,697

NON-PERFORMING LOANS AND LEASES:

Commercial and industrial

$         130

$         668

$         731

$      5,780

$             -

$         175

$       1,950

$       1,740

$       11,174

Real estate

   Consumer mortgages

899

2,797

1,867

9,063

758

635

1,815

8,602

26,436

   Home equity

798

1,286

490

452

-

555

-

3

3,584

   Agricultural

-

-

-

959

-

-

-

-

959

   Commercial and industrial-owner occupied

1,640

2,296

2,293

11,878

1,889

35

1,259

-

21,290

   Construction, acquisition and development

812

630

-

6,285

1,241

8

14

1

8,991

   Commercial real estate

1,285

1,146

2,885

11,908

-

2,196

166

-

19,586

Credit cards

-

-

-

-

-

-

-

1,212

1,212

All other

100

696

24

176

-

18

-

-

1,014

     Total loans

$       5,664

$       9,519

$       8,290

$    46,501

$       3,888

$       3,622

$       5,204

$     11,558

$       94,246

NON-PERFORMING LOANS AND LEASES

   AS A PERCENTAGE OF OUTSTANDING:

Commercial and industrial

0.09%

0.35%

0.37%

0.82%

0.00%

0.15%

0.87%

3.83%

0.65%

Real estate

   Consumer mortgages

0.30%

0.85%

0.84%

1.12%

0.99%

0.23%

0.40%

44.40%

1.07%

   Home equity

0.87%

3.09%

0.75%

0.20%

0.00%

0.38%

0.00%

0.17%

0.59%

   Agricultural

0.00%

0.00%

0.00%

1.43%

0.00%

0.00%

0.00%

N/A

0.40%

   Commercial and industrial-owner occupied

0.82%

1.28%

1.16%

1.75%

3.34%

0.03%

0.61%

N/A

1.29%

   Construction, acquisition and development

0.71%

0.60%

0.00%

2.04%

5.19%

0.01%

0.01%

100.00%

0.93%

   Commercial real estate

0.38%

0.32%

1.18%

1.99%

0.00%

1.22%

0.05%

N/A

0.88%

Credit cards

N/A

N/A

N/A

N/A

N/A

N/A

N/A

1.14%

1.14%

All other

0.15%

1.41%

0.08%

0.10%

0.00%

0.05%

0.00%

0.00%

0.23%

     Total loans

0.45%

0.71%

0.79%

1.31%

0.82%

0.35%

0.34%

5.93%

0.90%

 

BancorpSouth, Inc.

Noninterest Revenue and Expense

(Dollars in thousands)

(Unaudited)

Quarter Ended

YTD

Mar-16

Dec-15

Sep-15

Jun-15

Mar-15

Mar-16

Mar-15

NONINTEREST REVENUE:

Mortgage lending

$      2,618

$       10,522

$         2,339

$    14,102

$         8,567

$    2,618

$    8,567

Credit card, debit card and merchant fees

8,961

9,414

9,282

9,298

8,539

8,961

8,539

Deposit service charges

11,014

11,836

12,150

11,527

11,252

11,014

11,252

Securities gains, net

2

48

33

41

14

2

14

Insurance commissions

33,249

25,348

28,584

29,319

33,493

33,249

33,493

Trust income

3,430

3,469

3,653

3,543

4,036

3,430

4,036

Annuity fees

477

449

539

470

558

477

558

Brokerage commissions and fees

1,202

1,457

1,375

1,495

1,616

1,202

1,616

Bank-owned life insurance

1,893

1,881

1,842

1,835

1,899

1,893

1,899

Other miscellaneous income

2,669

2,962

3,156

2,684

3,341

2,669

3,341

     Total noninterest revenue

$    65,515

$       67,386

$       62,953

$    74,314

$       73,315

$  65,515

$  73,315

NONINTEREST EXPENSE:

Salaries and employee benefits

$    82,467

$       80,177

$       81,354

$    79,759

$       81,179

$  82,467

$  81,179

Occupancy, net of rental income

10,273

10,434

10,819

10,419

10,194

10,273

10,194

Equipment

3,765

3,569

3,742

4,024

3,974

3,765

3,974

Deposit insurance assessments

2,288

2,630

2,191

2,377

2,311

2,288

2,311

Regulatory settlement

10,277

-

-

-

-

10,277

-

Advertising

633

1,009

812

1,686

781

633

781

Foreclosed property expense

1,181

3,014

808

1,625

1,971

1,181

1,971

Telecommunications

1,295

1,322

1,267

1,323

1,314

1,295

1,314

Public relations

661

702

588

794

685

661

685

Data processing

6,391

6,092

6,156

5,898

6,002

6,391

6,002

Computer software

2,660

2,609

2,595

2,690

2,606

2,660

2,606

Amortization of intangibles

880

922

948

1,061

1,032

880

1,032

Legal

4,535

19,434

1,233

1,998

7,681

4,535

7,681

Merger expense

1

13

8

4

-

1

-

Postage and shipping

1,117

1,139

1,030

1,194

1,172

1,117

1,172

Other miscellaneous expense

13,876

15,285

12,899

13,325

16,031

13,876

16,031

Total noninterest expense

$  142,300

$      148,351

$      126,450

$  128,177

$      136,933

$ 142,300

$ 136,933

INSURANCE COMMISSIONS:

Property and casualty commissions

$    19,877

$       18,814

$       21,155

$    21,145

$       20,673

$  19,877

$  20,673

Life and health commissions

5,615

5,823

5,775

6,202

5,412

5,615

5,412

Risk management income

623

672

709

637

666

623

666

Other

7,134

39

945

1,335

6,742

7,134

6,742

Total insurance commissions

$    33,249

$       25,348

$       28,584

$    29,319

$       33,493

$  33,249

$  33,493

 

BancorpSouth, Inc.

Selected Additional Information

(Dollars in thousands)

(Unaudited)

Quarter Ended

Mar-16

Dec-15

Sep-15

Jun-15

Mar-15

MORTGAGE SERVICING RIGHTS:

Fair value, beginning of period

$     57,268

$       52,973

$       55,924

$     49,190

$       51,296

Additions to mortgage servicing rights:

   Originations of servicing assets

2,612

3,065

4,231

4,344

2,499

Changes in fair value:

   Due to payoffs/paydowns

(1,380)

(1,633)

(1,872)

(1,930)

(1,564)

   Due to change in valuation inputs or

     assumptions used in the valuation model

(7,954)

2,865

(5,308)

4,321

(3,039)

   Other changes in fair value

(2)

(2)

(2)

(1)

(2)

Fair value, end of period

$     50,544

$       57,268

$       52,973

$     55,924

$       49,190

Production revenue:

   Origination

$       7,208

$         4,909

$         5,154

$       7,395

$         8,914

   Servicing

4,744

4,381

4,365

4,316

4,256

   Payoffs/Paydowns

(1,380)

(1,633)

(1,872)

(1,930)

(1,564)

     Total production revenue

10,572

7,657

7,647

9,781

11,606

Market value adjustment

(7,954)

2,865

(5,308)

4,321

(3,039)

Total mortgage lending revenue

$       2,618

$       10,522

$         2,339

$     14,102

$         8,567

Mortgage loans serviced

$ 6,096,220

$   6,011,236

$   5,942,736

$ 5,802,407

$   5,705,638

MSR/mtg loans serviced

0.83%

0.95%

0.89%

0.96%

0.86%

AVAILABLE-FOR-SALE SECURITIES, at fair value

U.S. Government agencies

$ 1,196,167

$   1,244,640

$   1,255,717

$ 1,336,846

$   1,286,981

Government agency issued residential

   mortgage-back securities

189,741

140,540

206,878

217,191

200,381

Government agency issued commercial

   mortgage-back securities

207,908

260,693

229,922

224,450

227,409

Obligations of states and political subdivisions

408,537

417,499

451,600

458,322

471,539

Other

14,020

18,957

17,008

14,344

8,063

Total available-for-sale securities

$ 2,016,373

$   2,082,329

$   2,161,125

$ 2,251,153

$   2,194,373

 

BancorpSouth, Inc.

Reconciliation of Non-GAAP Measures and Other 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, 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, and operating earnings per share-excluding MSR.  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 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

3/31/2016

12/31/2015

9/30/2015

6/30/2015

3/31/2015

Net income

$          22,549

$          21,169

$          34,343

$          39,713

$         32,266

Plus:

Merger expense, net of tax

1

8

5

3

-

Legal charge, net of tax

-

10,246

-

-

-

Regulatory related charges, net of tax

9,412

-

-

-

-

Less:

Security gains, net of tax

2

30

20

26

10

Net operating income

$          31,960

$          31,393

$          34,328

$          39,690

$         32,256

Less:

MSR market value adjustment, net of tax

(4,931)

1,776

(3,291)

2,679

(1,884)

Net operating income-excluding MSR

$          36,891

$          29,617

$          37,619

$          37,011

$         34,140

 

BancorpSouth, Inc.

Reconciliation of Non-GAAP Measures and Other 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

3/31/2016

12/31/2015

9/30/2015

6/30/2015

3/31/2015

Tangible assets

Total assets

$    13,926,398

$    13,798,662

$    13,787,424

$    13,634,931

$   13,630,322

Less:  

Goodwill

291,498

291,498

291,498

291,498

291,498

Other identifiable intangible assets

19,664

20,545

21,466

22,415

23,476

Total tangible assets

$    13,615,236

$    13,486,619

$    13,474,460

$    13,321,018

$   13,315,348

Tangible shareholders' equity

Total shareholders' equity

$     1,679,793

$     1,655,444

$     1,644,820

$      1,680,196

$    1,645,208

Less:

Goodwill

291,498

291,498

291,498

291,498

291,498

Other identifiable intangible assets

19,664

20,545

21,466

22,415

23,476

Total tangible shareholders' equity

$     1,368,631

$     1,343,401

$     1,331,856

$      1,366,283

$    1,330,234

Total average assets

$    13,851,661

$    13,724,595

$    13,632,581

$    13,516,546

$   13,457,668

Total common shares outstanding

94,438,626

94,162,728

93,969,994

96,755,530

96,544,502

Average shares outstanding-diluted

94,593,540

94,384,443

96,467,728

96,957,441

96,653,401

Tangible shareholders' equity to tangible assets (1)

10.05%

9.96%

9.88%

10.26%

9.99%

Return on tangible equity (2)

6.63%

6.25%

10.23%

11.66%

9.84%

Operating return on tangible equity-excluding MSR (3)

10.84%

8.75%

11.21%

10.87%

10.41%

Operating return on average assets-excluding MSR (4)

1.07%

0.86%

1.09%

1.10%

1.03%

Operating return on average shareholders' equity-excluding MSR (5)

8.89%

7.12%

8.88%

8.94%

8.52%

Tangible book value per share (6)

$           14.49

$           14.27

$           14.17

$            14.12

$          13.78

Operating earnings per share (7)

$             0.34

$             0.33

$             0.36

$              0.41

$            0.33

Operating earnings per share-excluding MSR (8)

$             0.39

$             0.31

$             0.39

$              0.39

$            0.36

(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 common shares 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.  

 

To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/bancorpsouth-announces-first-quarter-2016-financial-results-300254906.html

SOURCE BancorpSouth, Inc.



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