Form 8-K BANCORPSOUTH INC For: Apr 20

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): April 21, 2015 (April 20, 2015)

 

 

BANCORPSOUTH, INC.

(Exact name of registrant as specified in its charter)

 

 

 

Mississippi		1-12991		64-0659571
(State or other jurisdiction of incorporation)		(Commission File Number)		(IRS Employer Identification No.)

 

One Mississippi Plaza 201 South Spring Street Tupelo, Mississippi		38804
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code (662) 680-2000

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

¨	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 

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Section 2 – Financial Information

Item 2.02. Results of Operations and Financial Condition.

On April 20, 2015, BancorpSouth, Inc. (the “Company”) issued a news release announcing its financial results for the first quarter ended March 31, 2015. A copy of the news release is furnished as Exhibit 99.1 to this Current Report on Form 8-K (this “Report”) and is incorporated herein by reference in its entirety.

Section 7 – Regulation FD

Item 7.01. Regulation FD Disclosure.

The Company will conduct a conference call at 10:00 a.m. (Central Time) on April 21, 2015 to discuss its financial results for the first quarter ended March 31, 2015. A copy of the presentation to be used for the conference call is furnished as Exhibit 99.2 to this Report and is incorporated herein by reference in its entirety.

Section 9 – Financial Statements and Exhibits

Item 9.01. Financial Statements and Exhibits.

 

(d)

Exhibits.

 

		Exhibit 99.1		News release issued on April 20, 2015 by BancorpSouth, Inc.
		Exhibit 99.2		Presentation for conference call to be conducted by BancorpSouth, Inc. on April 21, 2015

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

Date: April 21, 2015

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EXHIBIT INDEX

 

Exhibit Number		Description
99.1		News release issued on April 20, 2015 by BancorpSouth, Inc.
99.2		Presentation for conference call to be conducted by BancorpSouth, Inc. on April 21, 2015

Exhibit 99.1

News Release

 

 

Contact:
William L. Prater		Will Fisackerly
Senior Executive Vice President and		Senior Vice President and
Chief Financial Officer		Director of Corporate Finance
662/680-2536		662/680-2475

BancorpSouth Announces First Quarter 2015 Financial Results

TUPELO, MS, April 20, 2015/PRNewswire — BancorpSouth, Inc. (NYSE: BXS) today announced financial results for the quarter ended March 31, 2015.

Highlights for the first quarter of 2015 included:

 

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Net income of $32.3 million or $0.33 per diluted share.

 

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Net operating income of $32.3 million or $0.33 per diluted share.

 

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Generated deposit growth of $280.3 million, or 10.4 percent on an annualized basis.

 

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Continued credit quality improvement and recoveries of previously charged-off loans resulted in a negative provision for credit losses of $5.0 million.

 

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The consent order issued on September 4, 2014 related to Bank Secrecy Act (“BSA”) and anti-money laundering (“AML”) compliance was terminated effective April 7, 2015.

 

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Produced $33.5 million of insurance commission revenue, which represents the highest level of quarterly insurance commission revenue in the Company’s history.

 

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Mortgage lending revenue totaled $8.6 million, despite a negative mortgage servicing rights (“MSR”) valuation adjustment of $3.0 million.

 

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Merger applications for pending Ouachita Bancshares Corp. and Central Community Corporation transactions were re-filed with regulatory agencies.

 

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Earnings were adversely impacted by a $5.5 million increase to the litigation reserve for probable losses related to certain ongoing legal matters.

 

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BXS Announces First Quarter Results

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April 20, 2015

 

“We are extremely pleased to have the consent order related to BSA and AML compliance lifted,” remarked Dan Rollins, Chairman and Chief Executive Officer. “The timely resolution to this matter is reflective of the diligence, effort, and effectiveness our team displayed in dealing with the issue. We are appreciative of the guidance provided by our regulators through this process and their commitment to review our program in such a timely manner.”

The Company reported net income of $32.3 million, or $0.33 per diluted share, for the first quarter of 2015 compared with net income of $28.4 million, or $0.30 per diluted share, for the first quarter of 2014 and net income of $28.7 million, or $0.30 per diluted share, for the fourth quarter of 2014.

The Company reported net operating income (excluding merger related and other non-operating expenses) of $32.3 million, or $0.33 per diluted share, for the first quarter of 2015 compared to $28.8 million, or $0.30 per diluted share, for the first quarter of 2014 and $28.7 million, or $0.30 per diluted share, for the fourth quarter of 2014.

Rollins continued, “We are pleased to report quarterly results that reflect continued improvement in profitability and core operating performance. Earnings for the quarter benefited from growth in our noninterest products. Our insurance team generated $33.5 million of commission revenue, which is the largest quarterly insurance commission revenue total in our Company’s history. Our mortgage team produced $311.1 million of mortgage loans for the quarter, which contributed to mortgage lending revenue of $8.6 million. Finally, our wealth management team reported total revenue of $6.2 million. The growth in each of these products is reflective of our overall strategic focus on growing all areas of our Company as well as our ability to attract quality producers. While seasonal pay-downs in certain large commercial lines of credit provided a headwind to net loan growth, we continue to be pleased with our new loan production as well as our current loan pipeline.”

Earnings for the quarter benefitted from a negative provision for credit losses totaling $5.0 million. Rollins added, “Our reported credit quality metrics continue to improve. During the quarter, we also received recoveries of previously charged-off loans of $4.0 million. Our entire team has done an outstanding job in returning our Company’s credit quality to a level we are all proud of.”

Net Interest Revenue

Net interest revenue was $106.1 million for the first quarter of 2015, an increase of 4.5 percent from $101.5 million for the first quarter of 2014 and a decrease of 0.3 percent from $106.4 million for the fourth quarter of 2014. The fully taxable equivalent net interest margin was 3.56 percent for the first quarter of 2015 compared to 3.54 percent for the first quarter of 2014 and 3.60 percent for the fourth quarter of 2014. Yields on loans and leases declined to 4.31 percent for the first quarter of 2015 from 4.48 percent for the first quarter of 2014 and increased from 4.30 percent for the fourth quarter of 2014, while yields on total interest earning assets were 3.80 percent for the first quarter of 2015 compared with 3.85 percent for both the first quarter of 2014 and the fourth quarter of 2014. The average cost of deposits was 0.24 percent for the first quarter of 2015 compared to 0.31 percent for the first quarter of 2014 and 0.25 percent for the fourth quarter of 2014.

 

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BXS Announces First Quarter Results

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April 20, 2015

 

Asset, Deposit and Loan Activity

Total assets were $13.6 billion at March 31, 2015 compared with $13.1 billion at March 31, 2014. Loans and leases, net of unearned income, were $9.7 billion at March 31, 2015 compared with $9.1 billion at March 31, 2014.

Total deposits were $11.3 billion at March 31, 2015 compared with $10.8 billion at March 31, 2014. The decrease in time deposits of $243.8 million, or 11.1 percent, at March 31, 2015 compared to March 31, 2014 was offset by growth in other lower cost deposits. Noninterest bearing demand deposits increased $189.9 million, or 7.0 percent, over the same period. Additionally, savings deposits increased $98.5 million, or 7.6 percent, while interest bearing demand deposits increased $396.2 million, or 8.6 percent, over the same period. At March 31, 2015, $665.1 million of time deposits were scheduled to mature during the following two quarters at a weighted average rate of 0.68 percent.

Provision for Credit Losses and Allowance for Credit Losses

Earnings for the quarter reflect a negative provision for credit losses of $5.0 million, compared to no recorded provision for both the first quarter of 2014 and the fourth quarter of 2014. Total non-performing assets (“NPAs”) declined $67.5 million, or 43.0 percent, to $89.4 million at March 31, 2015 compared with $156.9 million at March 31, 2014 and declined $16.4 million, or 15.5 percent, from $105.7 million at December 31, 2014.

Net charge-offs for the first quarter of 2015 were $0.8 million, compared with $3.5 million for the first quarter of 2014 and $1.5 million for the fourth quarter of 2014. Recoveries of previously charged-off loans were $4.0 million for the first quarter of 2015, compared with $4.5 million for the first quarter of 2014 and $3.3 million for the fourth quarter of 2014. Annualized net charge-offs were 0.03 percent of average loans and leases for the first quarter of 2015, compared with 0.16 percent for the first quarter of 2014 and 0.06 percent for the fourth quarter of 2014.

Non-performing loans (“NPLs”) were $61.5 million, or 0.63 percent of net loans and leases, at March 31, 2015, compared with $93.3 million, or 1.03 percent of net loans and leases, at March 31, 2014, and $71.7 million, or 0.74 percent of net loans and leases, at December 31, 2014. The allowance for credit losses was $136.7 million, or 1.40 percent of net loans and leases, at March 31, 2015 compared with $149.7 million, or 1.65 percent of net loans and leases, at March 31, 2014 and $142.4 million, or 1.47 percent of net loans and leases, at December 31, 2014.

NPLs at March 31, 2015 consisted primarily of $54.4 million of nonaccrual loans, compared with $58.1 million of nonaccrual loans at December 31, 2014. Payments received on nonaccrual loans during the first quarter of 2015 totaled $18.9 million, compared with payments received on such loans of $8.5 million during the fourth quarter of 2014. NPLs at March 31, 2015 also included $1.6 million of loans 90 days or more past due and still accruing, compared with $2.8

 

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BXS Announces First Quarter Results

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April 20, 2015

 

million of such loans at December 31, 2014, and included restructured loans still accruing of $5.4 million at March 31, 2015, compared with $10.9 million of such loans at December 31, 2014. Early stage past due loans, representing loans 30-89 days past due, totaled $29.1 million at March 31, 2015 compared to $25.8 million at December 31, 2014.

Other real estate owned (“OREO”) decreased $6.1 million to $27.9 million during the first quarter of 2015 from $34.0 million at December 31, 2014. This net decrease reflected $2.8 million of OREO added through foreclosure, offset by sales of OREO of $6.7 million. Write-downs in the value of existing properties were $2.2 million for the first quarter of 2015 compared to $2.4 million for the fourth quarter of 2014. Sales of OREO during the first quarter of 2015 resulted in a net gain of $0.8 million compared to a net loss of $1.6 million for the fourth quarter of 2014. At March 31, 2015, OREO was carried at 39.0 percent of the aggregate loan balances at the time of foreclosure, compared with 40.6 percent at December 31, 2014.

Noninterest Revenue

Noninterest revenue was $73.3 million for the first quarter of 2015, compared with $66.5 million for the first quarter of 2014 and $63.5 million for the fourth quarter of 2014. These results included a negative MSR valuation adjustment of $3.0 million for the first quarter of 2015 compared with a negative MSR valuation adjustment of $1.5 million for the first quarter of 2014 and a negative MSR valuation adjustment of $3.4 million for the fourth quarter of 2014. 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 $11.6 million for the first quarter of 2015, compared with $4.9 million for the first quarter of 2014 and $6.7 million for the fourth quarter of 2014. Mortgage origination volume for the first quarter of 2015 was $311.1 million, compared with $197.1 million for the first quarter of 2014 and $256.3 million for the fourth quarter of 2014.

Credit and debit card fee revenue was $8.5 million for the first quarter of 2015, compared with $7.8 million for the first quarter of 2014 and $9.9 million for the fourth quarter of 2014. Deposit service charge revenue was $11.3 million for the first quarter of 2015, compared with $12.5 million for the first quarter of 2014 and $12.5 million for the fourth quarter of 2014. Insurance commission revenue was $33.5 million for the first quarter of 2015, compared with $31.6 million for the first quarter of 2014 and $25.4 million for the fourth quarter of 2014. Wealth management revenue was $6.2 million for the first quarter of 2015, compared with $5.9 million for the first quarter of 2014 and $5.8 million for the fourth quarter of 2014.

Noninterest Expense

Noninterest expense for the first quarter of 2015 was $136.9 million, compared with $126.7 million for the first quarter of 2014 and $130.0 million for the fourth quarter of 2014. Salaries and employee benefits expense was $81.2 million for the first quarter of 2015 compared to $78.9 million for the first quarter of 2014 and $76.8 million for the fourth quarter of 2014. The current quarter increase was driven by a number of factors, including an increase in pension expense.

 

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BXS Announces First Quarter Results

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April 20, 2015

 

Total annual pension expense for 2015 is expected to be approximately $7 million higher than 2014 due to annual revisions to actuarial assumptions, including updates to the Society of Actuaries pension plan mortality tables. Foreclosed property expense was $2.0 million for the first quarter of 2015 compared with $2.6 million for the first quarter of 2014 and $4.6 million for the fourth quarter of 2014. Deposit insurance assessments were $2.3 million for the first quarter of 2015 compared to $1.6 million for the first quarter of 2014 and $2.4 million for the fourth quarter of 2014. During the first quarter of 2015, the Company incurred expense of $5.5 million to increase its litigation accrual for probable losses related to certain ongoing legal matters.

Rollins added, “We continue to evaluate the profitability and performance of each of our locations. Through location consolidations, we have reduced our full service branch count to 240 from 257 at the beginning of 2014.” The Company’s current location count includes 240 full service branches, including remote drive-through facilities, 6 loan production offices, 12 stand-alone mortgage offices and 26 insurance locations.

Capital Management

The Company’s equity capitalization is comprised entirely of common stock. BancorpSouth’s ratio of shareholders’ equity to assets was 12.07 percent at March 31, 2015, compared with 11.83 percent at March 31, 2014 and 12.05 percent at December 31, 2014. The ratio of tangible shareholders’ equity to tangible assets was 9.99 percent at March 31, 2015, compared with 9.69 percent at March 31, 2014 and 9.92 percent at December 31, 2014.

Estimated regulatory capital ratios at March 31, 2015 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 12.87 percent at March 31, 2015 and total risk based capital of 14.14 percent, compared with required minimum levels of 8 percent and 10 percent, respectively, for “well capitalized” classification.

Transaction Closings and Announcements

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 12 full-service banking offices along the I-20 corridor and has loan production offices in Madison, Mississippi and Natchitoches, Louisiana. As of March 31, 2015, OIB, on a consolidated basis, reported total assets of $653.6 million, total loans of $462.1 million and total deposits of $545.3 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 terms of the amended agreement provide for a minimum total deal value of $107.5 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 merger has been unanimously approved by the Board of Directors of each company and was approved by OIB shareholders on April 8, 2014. On July 21, 2014, the Company announced the merger

 

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BXS Announces First Quarter Results

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April 20, 2015

 

agreement was extended until June 30, 2015 to allow for additional time to obtain the necessary regulatory approvals and to satisfy all closing conditions, and, on February 25, 2015, the Company re-filed the merger application for the merger with Ouachita Bancshares Corp. with the appropriate regulatory agencies. 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, 2015, Central Community Corporation, on a consolidated basis, reported total assets of $1.4 billion, total loans of $600.5 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 terms of the amended agreement provide for a minimum total deal value of $191.0 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 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 July 21, 2014, the Company announced the merger agreement was extended until June 30, 2015 to allow for additional time to obtain the necessary regulatory approvals and to satisfy all closing conditions, and, on February 25, 2015, the Company re-filed the merger application for the merger with Central Community Corporation with the appropriate regulatory agencies. 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 additional information regarding the status of the merger with Ouachita Bancshares Corp. and the status of the merger with Central Community Corporation, please refer to the Current Report on Form 8-K that was previously filed with the Securities and Exchange Commission (the “SEC”) on July 24, 2014, Part II, Item 5 of the Quarterly Report on Form 10-Q that was previously filed with the SEC on August 6, 2014, the Current Report on Form 8-K that was previously filed with the SEC on September 4, 2014, and the Annual Report on Form 10-K that was previously filed with the SEC on February 24, 2015.

On April 9, 2014, BancorpSouth Insurance Services, Inc. acquired the assets of Lafayette, Louisiana based Knox Insurance Group, LLC. Knox was formed in 1972 and currently produces annual revenues of approximately $3 million. Knox will continue to operate under current leadership in Lafayette.

 

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BXS Announces First Quarter Results

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April 20, 2015

 

Summary

Rollins concluded, “The momentum built over the last two years through the dedication and hard work of our team continues to drive the improved financial performance reflected in our first quarter results. Particularly, our efforts to enhance our sales focus as well as hiring proven producers are yielding results. We are growing the customer base in our bank and across all products. We continue to benefit from improved credit quality as well. Finally, we continue to focus on reducing operating expenses and improving efficiency. I’m excited about the position of our Company and optimistic about our ability to continue to improve profitability.”

Conference Call

BancorpSouth will conduct a conference call to discuss its first quarter 2015 results on April 21, 2015, 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 $13.6 billion in assets. BancorpSouth Bank, a wholly-owned subsidiary of BancorpSouth, Inc., operates 284 commercial banking, mortgage, and insurance locations 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 findings and results of 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, the impact of litigation regarding debit card fees 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, the findings and results of the CFPB and the DOJ in their review of the Company’s fair lending practices, 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

 

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BXS Announces First Quarter Results

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April 20, 2015

 

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.

 

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BXS Announces First Quarter Results

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April 20, 2015

 

BancorpSouth, Inc.

Selected Financial Information

(Dollars in thousands, except per share data)

(Unaudited)

 

		Quarter Ended 3/31/2015				Quarter Ended 12/31/2014				Quarter Ended 9/30/2014				Quarter Ended 6/30/2014				Quarter Ended 3/31/2014
Earnings Summary:
Interest revenue		$	113,497			$	114,237			$	113,922			$	111,499			$	110,599
Interest expense			7,424				7,792				8,309				8,418				9,076
Net interest revenue			106,073				106,445				105,613				103,081				101,523
Provision for credit losses			(5,000	)			—				—				—				—
Net interest revenue, after provision for credit losses			111,073				106,445				105,613				103,081				101,523
Noninterest revenue			73,315				63,513				69,278				69,838				66,517
Noninterest expense			136,933				130,046				133,699				127,954				126,707
Income before income taxes			47,455				39,912				41,192				44,965				41,333
Income tax expense			15,189				11,252				12,414				14,097				12,889
Net income		$	32,266			$	28,660			$	28,778			$	30,868			$	28,444
Balance Sheet - Period End Balances
Total assets		$	13,630,322			$	13,326,369			$	13,071,557			$	12,985,887			$	13,143,555
Total earning assets			12,468,322				12,163,897				11,929,416				11,794,445				11,948,897
Total securities			2,194,373				2,156,927				2,211,462				2,332,192				2,426,758
Loans and leases, net of unearned income			9,726,970				9,712,936				9,510,542				9,311,661				9,068,376
Allowance for credit losses			136,660				142,443				143,950				147,132				149,704
Total deposits			11,252,654				10,972,339				10,701,537				10,670,414				10,811,790
Long-term debt			76,055				78,148				81,742				83,835				85,835
Total shareholders’ equity			1,645,208				1,606,059				1,610,543				1,588,850				1,554,676
Balance Sheet - Average Balances
Total assets		$	13,457,668			$	13,131,130			$	12,987,103			$	12,933,879			$	13,087,128
Total earning assets			12,398,058				12,038,265				11,892,493				11,825,994				11,958,836
Total securities			2,190,989				2,180,000				2,272,114				2,394,045				2,452,178
Loans and leases, net of unearned income			9,670,987				9,579,059				9,393,709				9,232,743				9,022,155
Total deposits			11,126,210				10,802,194				10,662,841				10,650,077				10,825,308
Long-term debt			76,078				79,387				81,742				83,967				87,767
Total shareholders’ equity			1,624,496				1,613,239				1,600,721				1,574,588				1,537,897
Nonperforming Assets:
Non-accrual loans and leases		$	54,418			$	58,052			$	54,612			$	64,533			$	77,531
Loans and leases 90+ days past due, still accruing			1,615				2,763				1,925				2,406				1,949
Restructured loans and leases, still accruing			5,433				10,920				12,398				6,712				13,776
Non-performing loans (NPLs)			61,466				71,735				68,935				73,651				93,256
Other real estate owned			27,889				33,984				42,691				55,253				63,595
Non-performing assets (NPAs)		$	89,355			$	105,719			$	111,626			$	128,904			$	156,851
Financial Ratios and Other Data:
Return on average assets			0.97	%			0.87	%			0.88	%			0.96	%			0.88	%
Return on average shareholders’ equity			8.06	%			7.05	%			7.13	%			7.86	%			7.50	%
Return on tangible equity			9.84	%			8.81	%			8.83	%			9.74	%			9.28	%
Pre-tax pre-provision return on average assets			1.29	%			1.21	%			1.26	%			1.39	%			1.28	%
Noninterest income to average assets			2.21	%			1.92	%			2.12	%			2.17	%			2.06	%
Noninterest expense to average assets			4.13	%			3.93	%			4.08	%			3.97	%			3.93	%
Net interest margin-fully taxable equivalent			3.56	%			3.60	%			3.62	%			3.59	%			3.54	%
Net interest rate spread			3.46	%			3.49	%			3.50	%			3.48	%			3.43	%
Efficiency ratio (tax equivalent)			75.17	%			75.25	%			75.19	%			72.76	%			74.16	%
Loan/deposit ratio			86.44	%			88.52	%			88.87	%			87.27	%			83.87	%
Price to earnings mult (avg)			18.43				18.45				16.64				21.00				23.33
Market value to book value			136.26	%			134.91	%			120.13	%			148.53	%			154.13	%
Market value to book value (avg)			127.91	%			130.16	%			129.54	%			143.72	%			150.43	%
Market value to tangible book value			168.52	%			167.95	%			149.58	%			185.73	%			192.80	%
Market value to tangible book value (avg)			158.20	%			162.04	%			161.30	%			179.75	%			188.17	%
Headcount FTE			3,924				3,948				3,938				3,981				3,981

 

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BXS Announces First Quarter Results

Page 10

April 20, 2015

 

BancorpSouth, Inc.

Selected Financial Information

(Dollars in thousands, except per share data)

(Unaudited)

 

		Quarter Ended 3/31/2015				Quarter Ended 12/31/2014				Quarter Ended 9/30/2014				Quarter Ended 6/30/2014				Quarter Ended 3/31/2014
Credit Quality Ratios:
Net charge-offs to average loans and leases (annualized)			0.03	%			0.06	%			0.13	%			0.11	%			0.16	%
Provision for credit losses to average loans and leases (annualized)			(0.21	%)			0.00	%			0.00	%			0.00	%			0.00	%
Allowance for credit losses to net loans and leases			1.40	%			1.47	%			1.51	%			1.58	%			1.65	%
Allowance for credit losses to non-performing loans and leases			222.33	%			198.57	%			208.82	%			199.77	%			160.53	%
Allowance for credit losses to non-performing assets			152.94	%			134.74	%			128.96	%			114.14	%			95.44	%
Non-performing loans and leases to net loans and leases			0.63	%			0.74	%			0.72	%			0.79	%			1.03	%
Non-performing assets to net loans and leases			0.92	%			1.09	%			1.17	%			1.38	%			1.73	%
Equity Ratios:
Total shareholders’ equity to total assets			12.07	%			12.05	%			12.32	%			12.24	%			11.83	%
Tangible shareholders’ equity to tangible assets			9.99	%			9.92	%			10.14	%			10.03	%			9.69	%
Capital Adequacy:
Tier 1 capital			12.87	%*			13.26	%			13.18	%			13.09	%			13.18	%
Total capital			14.14	%*			14.52	%			14.43	%			14.35	%			14.44	%
Tier 1 leverage capital			10.30	%*			10.55	%			10.47	%			10.33	%			10.04	%
Estimated for current quarter
Common Share Data:
Basic earnings per share		$	0.33			$	0.30			$	0.30			$	0.32			$	0.30
Diluted earnings per share			0.33				0.30				0.30				0.32				0.30
Cash dividends per share			0.08				0.08				0.08				0.05				0.05
Book value per share			17.04				16.69				16.77				16.54				16.19
Tangible book value per share			13.78				13.40				13.46				13.23				12.95
Market value per share (last)			23.22				22.51				20.14				24.57				24.96
Market value per share (high)			23.68				23.28				25.43				25.55				26.24
Market value per share (low)			19.64				19.22				20.11				22.16				22.46
Market value per share (avg)			21.80				21.72				21.72				23.78				24.36
Dividend payout ratio			22.40	%			25.17	%			25.03	%			15.56	%			16.80	%
Total shares outstanding			96,544,502				96,254,903				96,065,021				96,046,057				96,004,679
Average shares outstanding - basic			96,359,885				96,173,000				96,052,260				96,034,475				95,629,890
Average shares outstanding - diluted			96,653,401				96,506,827				96,373,950				96,373,121				95,952,611
Yield/Rate:
(Taxable equivalent basis)
Loans, loans held for sale, and leases net of unearned income			4.31	%			4.30	%			4.36	%			4.38	%			4.48	%
Available-for-sale securities:
Taxable			1.54	%			1.43	%			1.42	%			1.45	%			1.50	%
Tax-exempt			5.40	%			5.30	%			5.37	%			5.44	%			5.58	%
Short-term investments			0.22	%			0.24	%			0.22	%			0.24	%			0.25	%
Total interest earning assets and revenue			3.80	%			3.85	%			3.89	%			3.88	%			3.85	%
Deposits:			0.24	%			0.25	%			0.28	%			0.28	%			0.31	%
Demand - interest bearing			0.18	%			0.18	%			0.17	%			0.17	%			0.17	%
Savings			0.12	%			0.12	%			0.12	%			0.12	%			0.13	%
Other time			0.82	%			0.87	%			0.96	%			0.97	%			1.06	%
Short-term borrowings			0.12	%			0.11	%			0.10	%			0.09	%			0.07	%
Total int bearing dep & s/t borrowings			0.31	%			0.33	%			0.36	%			0.37	%			0.39	%
Junior subordinated debt			2.84	%			2.82	%			2.81	%			2.81	%			2.86	%
Long-term debt			2.88	%			2.86	%			2.85	%			2.84	%			2.91	%
Total interest bearing liabilities and expense			0.34	%			0.36	%			0.39	%			0.40	%			0.42	%
Interest bearing liabilities to interest earning assets			71.13	%			70.57	%			71.07	%			71.98	%			73.51	%
Net interest tax equivalent adjustment		$	2,653			$	2,736			$	2,810			$	2,860			$	2,823

*Estimated regulatory capital ratios for the quarter ended March 31, 2015 were calculated in accordance with the Basel III capital framework.

 

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BXS Announces First Quarter Results

Page 11

April 20, 2015

 

BancorpSouth, Inc.

Consolidated Balance Sheets

(Unaudited)

 

		Mar-15				Dec-14				Sep-14				Jun-14				Mar-14
		(Dollars in thousands)
Assets
Cash and due from banks		$	199,337			$	204,231			$	169,226			$	201,196			$	199,214
Interest bearing deposits with other banks			360,469				153,019				70,408				44,949				390,896
Available-for-sale securities, at fair value			2,194,373				2,156,927				2,211,462				2,332,192				2,426,758
Loans and leases			9,761,555				9,749,540				9,546,250				9,347,429				9,103,850
Less: Unearned income			34,585				36,604				35,708				35,768				35,474
Allowance for credit losses			136,660				142,443				143,950				147,132				149,704
Net loans and leases			9,590,310				9,570,493				9,366,592				9,164,529				8,918,672
Loans held for sale			186,510				141,015				137,005				105,643				62,867
Premises and equipment, net			305,335				304,943				307,497				310,515				314,367
Accrued interest receivable			42,933				41,985				42,311				40,697				42,666
Goodwill			291,498				291,498				291,498				291,498				286,800
Other identifiable intangibles			23,476				24,508				25,619				26,745				25,021
Bank owned life insurance			246,148				247,076				243,827				241,962				240,077
Other real estate owned			27,889				33,984				42,691				55,253				63,595
Other assets			162,044				156,690				163,421				170,708				172,622
Total Assets		$	13,630,322			$	13,326,369			$	13,071,557			$	12,985,887			$	13,143,555
Liabilities
Deposits:
Demand: Noninterest bearing		$	2,914,949			$	2,778,686			$	2,811,156			$	2,718,242			$	2,725,042
Interest bearing			4,979,710				4,868,054				4,498,275				4,511,760				4,583,481
Savings			1,395,857				1,331,963				1,311,874				1,299,203				1,297,344
Other time			1,962,138				1,993,636				2,080,232				2,141,209				2,205,923
Total deposits			11,252,654				10,972,339				10,701,537				10,670,414				10,811,790
Federal funds purchased and securities sold under agreement to repurchase			384,829				388,166				431,428				394,446				456,303
Short-term Federal Home Loan Bank borrowings and other short-term borrowing			1,500				3,500				2,000				2,000				—
Accrued interest payable			3,371				3,400				3,894				3,926				4,050
Junior subordinated debt securities			23,198				23,198				23,198				23,198				23,198
Long-term debt			76,055				78,148				81,742				83,835				85,835
Other liabilities			243,507				251,559				217,215				219,218				207,703
Total Liabilities			11,985,114				11,720,310				11,461,014				11,397,037				11,588,879
Shareholders’ Equity
Common stock			241,361				240,637				240,165				240,118				240,012
Capital surplus			331,016				324,271				322,488				321,952				320,969
Accumulated other comprehensive loss			(37,033	)			(43,686	)			(15,513	)			(15,040	)			(22,060	)
Retained earnings			1,109,864				1,084,837				1,063,403				1,041,820				1,015,755
Total Shareholders’ Equity			1,645,208				1,606,059				1,610,543				1,588,850				1,554,676
Total Liabilities & Shareholders’ Equity		$	13,630,322			$	13,326,369			$	13,071,557			$	12,985,887			$	13,143,555

 

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BXS Announces First Quarter Results

Page 12

April 20, 2015

 

BancorpSouth, Inc.

Consolidated Average Balance Sheets

(Unaudited)

 

		Mar-15				Dec-14				Sep-14				Jun-14				Mar-14
		(Dollars in thousands)
Assets
Cash and due from banks		$	132,734			$	166,941			$	155,876			$	157,813			$	168,056
Interest bearing deposits with other banks			426,792				165,713				120,707				145,530				449,207
Available-for-sale securities, at fair value			2,190,989				2,180,000				2,272,114				2,394,045				2,452,178
Loans and leases			9,706,941				9,615,125				9,430,043				9,269,469				9,058,081
Less: Unearned income			35,954				36,066				36,334				36,726				35,926
Allowance for credit losses			141,299				143,842				146,592				149,676				153,615
Net loans and leases			9,529,688				9,435,217				9,247,117				9,083,067				8,868,540
Loans held for sale			109,291				113,493				105,964				53,676				35,297
Premises and equipment, net			305,277				306,630				309,373				313,012				315,804
Accrued interest receivable			39,279				39,034				38,758				38,291				39,336
Goodwill			291,498				291,498				291,498				293,082				286,800
Other identifiable intangibles			23,834				24,910				26,031				25,271				25,420
Bank owned life insurance			246,538				245,584				242,718				240,736				239,969
Other real estate owned			32,062				39,209				49,123				60,822				69,086
Other assets			129,686				122,901				127,824				128,534				137,435
Total Assets		$	13,457,668			$	13,131,130			$	12,987,103			$	12,933,879			$	13,087,128
Liabilities
Deposits:
Demand: Noninterest bearing		$	2,807,816			$	2,837,919			$	2,766,626			$	2,683,939			$	2,647,376
Interest bearing			4,985,577				4,617,998				4,480,008				4,492,495				4,657,785
Savings			1,358,565				1,321,000				1,308,184				1,298,829				1,260,838
Other time			1,974,252				2,025,277				2,108,023				2,174,814				2,259,309
Total deposits			11,126,210				10,802,194				10,662,841				10,650,077				10,825,308
Federal funds purchased and securities sold under agreement to repurchase			398,237				426,842				444,017				435,505				458,436
Short-term Federal Home Loan Bank borrowings and other short-term borrowing			3,056				2,261				6,489				3,621				—
Accrued interest payable			3,338				3,630				3,940				3,926				4,400
Junior subordinated debt securities			23,198				23,198				23,198				23,198				23,748
Long-term debt			76,078				79,387				81,742				83,967				87,767
Other liabilities			203,055				180,379				164,155				158,997				149,572
Total Liabilities			11,833,172				11,517,891				11,386,382				11,359,291				11,549,231
Shareholders’ Equity
Common stock			240,992				240,436				240,123				240,071				238,853
Capital surplus			326,476				323,372				322,219				321,628				314,117
Accumulated other comprehensive loss			(39,529	)			(22,747	)			(14,827	)			(16,663	)			(23,644	)
Retained earnings			1,096,557				1,072,178				1,053,206				1,029,552				1,008,571
Total Shareholders’ Equity			1,624,496				1,613,239				1,600,721				1,574,588				1,537,897
Total Liabilities & Shareholders’ Equity		$	13,457,668			$	13,131,130			$	12,987,103			$	12,933,879			$	13,087,128

 

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BXS Announces First Quarter Results

Page 13

April 20, 2015

 

BancorpSouth, Inc.

Consolidated Condensed Statements of Income

(Dollars in thousands, except per share data)

(Unaudited)

 

		Quarter Ended																				YTD
		Mar-15				Dec-14				Sep-14				Jun-14				Mar-14				Mar-15				Mar-14
INTEREST REVENUE:
Loans and leases		$	102,135			$	103,172			$	102,681			$	99,962			$	98,744			$	102,135			$	98,744
Deposits with other banks			236				101				68				87				276				236				276
Available-for-sale securities:
Taxable			6,844				6,429				6,646				7,133				7,547				6,844				7,547
Tax-exempt			3,377				3,471				3,607				3,669				3,715				3,377				3,715
Loans held for sale			905				1,064				920				648				317				905				317
Total interest revenue			113,497				114,237				113,922				111,499				110,599				113,497				110,599
INTEREST EXPENSE:
Interest bearing demand			2,183				2,070				1,956				1,905				1,920				2,183				1,920
Savings			412				411				410				402				391				412				391
Other time			4,008				4,453				5,083				5,249				5,890				4,008				5,890
Federal funds purchased and securities sold under agreement to repurchase			82				89				84				80				78				82				78
Long-term debt			577				603				612				619				629				577				629
Junior subordinated debt			163				165				164				162				168				163				168
Other			(1	)			1				—				1				—				(1	)			—
Total interest expense			7,424				7,792				8,309				8,418				9,076				7,424				9,076
Net interest revenue			106,073				106,445				105,613				103,081				101,523				106,073				101,523
Provision for credit losses			(5,000	)			—				—				—				—				(5,000	)			—
Net interest revenue, after provision for credit losses			111,073				106,445				105,613				103,081				101,523				111,073				101,523
NONINTEREST REVENUE:
Mortgage lending			8,567				3,250				6,938				9,089				3,394				8,567				3,394
Credit card, debit card and merchant fees			8,539				9,921				8,972				8,567				7,843				8,539				7,843
Deposit service charges			11,252				12,538				13,111				12,437				12,536				11,252				12,536
Security gains (losses), net			14				18				18				5				(4	)			14				(4	)
Insurance commissions			33,493				25,376				29,246				28,621				31,599				33,493				31,599
Wealth Management			6,210				5,826				5,961				5,828				5,916				6,210				5,916
Other			5,240				6,584				5,032				5,291				5,233				5,240				5,233
Total noninterest revenue			73,315				63,513				69,278				69,838				66,517				73,315				66,517
NONINTEREST EXPENSE:
Salaries and employee benefits			81,179				76,751				77,453				74,741				78,883				81,179				78,883
Occupancy, net of rental income			10,194				10,500				10,313				10,245				10,287				10,194				10,287
Equipment			3,974				3,996				4,205				4,169				4,499				3,974				4,499
Deposit insurance assessments			2,311				2,430				2,125				2,035				1,600				2,311				1,600
Other			39,275				36,369				39,603				36,764				31,438				39,275				31,438
Total noninterest expenses			136,933				130,046				133,699				127,954				126,707				136,933				126,707
Income before income taxes			47,455				39,912				41,192				44,965				41,333				47,455				41,333
Income tax expense			15,189				11,252				12,414				14,097				12,889				15,189				12,889
Net income		$	32,266			$	28,660			$	28,778			$	30,868			$	28,444			$	32,266			$	28,444
Net income per share: Basic		$	0.33			$	0.30			$	0.30			$	0.32			$	0.30			$	0.33			$	0.30
Diluted		$	0.33			$	0.30			$	0.30			$	0.32			$	0.30			$	0.33			$	0.30

 

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BXS Announces First Quarter Results

Page 14

April 20, 2015

 

BancorpSouth, Inc.

Selected Loan Data

(Dollars in thousands)

(Unaudited)

 

		Quarter Ended
		Mar-15				Dec-14				Sep-14				Jun-14				Mar-14
LOAN AND LEASE PORTFOLIO:
Commercial and industrial		$	1,676,366			$	1,746,486			$	1,714,012			$	1,699,803			$	1,581,251
Real estate
Consumer mortgages			2,301,112				2,257,726				2,191,265				2,071,503				2,047,001
Home equity			538,042				531,374				518,263				506,988				498,283
Agricultural			236,898				239,616				242,023				238,003				229,602
Commercial and industrial-owner occupied			1,518,153				1,522,536				1,508,679				1,505,679				1,488,380
Construction, acquisition and development			892,730				853,623				819,636				772,162				748,027
Commercial real estate			1,993,473				1,961,977				1,916,577				1,901,759				1,847,983
Credit cards			106,287				113,426				109,464				109,186				105,988
All other			463,909				486,172				490,623				506,578				521,861
Total loans		$	9,726,970			$	9,712,936			$	9,510,542			$	9,311,661			$	9,068,376
ALLOWANCE FOR CREDIT LOSSES:
Balance, beginning of period		$	142,443			$	143,950			$	147,132			$	149,704			$	153,236
Loans and leases charged-off:
Commercial and industrial			(383	)			(1,179	)			(306	)			(860	)			(201	)
Real estate
Consumer mortgages			(892	)			(900	)			(1,510	)			(1,682	)			(1,945	)
Home equity			(498	)			(93	)			(510	)			(438	)			(318	)
Agricultural			(8	)			(4	)			(47	)			(18	)			(696	)
Commercial and industrial-owner occupied			(394	)			(220	)			(1,229	)			(936	)			(1,206	)
Construction, acquisition and development			(343	)			(566	)			(1,458	)			(41	)			(1,666	)
Commercial real estate			(1,007	)			(463	)			(70	)			(361	)			(901	)
Credit cards			(676	)			(580	)			(612	)			(608	)			(559	)
All other			(579	)			(847	)			(743	)			(671	)			(583	)
Total loans charged-off			(4,780	)			(4,852	)			(6,485	)			(5,615	)			(8,075	)
Recoveries:
Commercial and industrial			502				298				565				359				1,076
Real estate
Consumer mortgages			612				821				952				956				538
Home equity			241				102				157				182				184
Agricultural			269				16				45				26				9
Commercial and industrial-owner occupied			550				216				460				78				358
Construction, acquisition and development			604				897				392				808				1,637
Commercial real estate			720				623				286				226				323
Credit cards			153				160				116				135				131
All other			346				212				330				273				287
Total recoveries			3,997				3,345				3,303				3,043				4,543
Net charge-offs			(783	)			(1,507	)			(3,182	)			(2,572	)			(3,532	)
Provision charged to operating expense			(5,000	)			—				—				—				—
Balance, end of period		$	136,660			$	142,443			$	143,950			$	147,132			$	149,704
Average loans for period		$	9,670,987			$	9,579,059			$	9,393,709			$	9,232,743			$	9,022,155
Ratio:
Net charge-offs to average loans (annualized)			0.03	%			0.06	%			0.13	%			0.11	%			0.16	%

 

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BXS Announces First Quarter Results

Page 15

April 20, 2015

 

BancorpSouth, Inc.

Selected Loan Data

(Dollars in thousands)

(Unaudited)

 

		Quarter Ended
		Mar-15				Dec-14				Sep-14				Jun-14				Mar-14
NON-PERFORMING ASSETS
NON-PERFORMING LOANS AND LEASES:
Nonaccrual Loans and Leases
Commercial and industrial		$	3,923			$	3,934			$	2,786			$	2,917			$	3,023
Real estate
Consumer mortgages			21,435				23,668				23,408				24,355				24,353
Home equity			2,269				2,253				2,073				2,116				2,740
Agricultural			259				291				638				595				651
Commercial and industrial-owner occupied			9,687				11,190				7,495				11,094				14,122
Construction, acquisition and development			5,111				4,162				6,070				9,202				9,968
Commercial real estate			11,107				11,915				11,102				13,406				21,496
Credit cards			118				133				168				132				168
All other			509				506				872				716				1,010
Total nonaccrual loans and leases		$	54,418			$	58,052			$	54,612			$	64,533			$	77,531
Loans and Leases 90+ Days Past Due, Still Accruing:
Commercial and industrial		$	30			$	41			$	60			$	302			$	287
Real estate
Consumer mortgages			1,256				1,828				1,590				1,607				1,307
Home equity			—				—				20				116				12
Agricultural			—				—				—				100				—
Commercial and industrial-owner occupied			—				39				—				—				—
Construction, acquisition and development			—				387				—				—				—
Commercial real estate			—				137				—				—				—
Credit cards			329				327				255				281				297
All other			—				4				—				—				46
Total loans and leases 90+ days past due, still accruing			1,615				2,763				1,925				2,406				1,949
Restructured Loans and Leases, Still Accruing			5,433				10,920				12,398				6,712				13,776
Total non-performing loans and leases			61,466				71,735				68,935				73,651				93,256
OTHER REAL ESTATE OWNED:			27,889				33,984				42,691				55,253				63,595
Total Non-performing Assets		$	89,355			$	105,719			$	111,626			$	128,904			$	156,851
Additions to Nonaccrual Loans and Leases During the Quarter		$	23,607			$	21,952			$	16,707			$	13,748			$	22,479
Loans and Leases 30-89 Days Past Due, Still Accruing:
Commercial and industrial		$	3,270			$	2,319			$	3,753			$	3,605			$	2,616
Real estate
Consumer mortgages			9,955				11,412				13,013				11,448				12,236
Home equity			2,594				2,047				1,315				960				1,587
Agricultural			161				366				190				1,122				302
Commercial and industrial-owner occupied			3,026				912				2,364				6,340				3,248
Construction, acquisition and development			5,471				4,811				1,036				1,616				2,848
Commercial real estate			3,032				1,510				926				1,658				3,953
Credit cards			581				739				602				556				592
All other			1,014				1,698				1,196				1,490				963
Total Loans and Leases 30-89 days past due, still accruing		$	29,104			$	25,814			$	24,395			$	28,795			$	28,345
Credit Quality Ratios:
Provision for credit losses to average loans and leases (annualized)			(0.21	%)			0.00	%			0.00	%			0.00	%			0.00	%
Allowance for credit losses to net loans and leases			1.40	%			1.47	%			1.51	%			1.58	%			1.65	%
Allowance for credit losses to non-performing loans and leases			222.33	%			198.57	%			208.82	%			199.77	%			160.53	%
Allowance for credit losses to non-performing assets			152.94	%			134.74	%			128.96	%			114.14	%			95.44	%
Non-performing loans and leases to net loans and leases			0.63	%			0.74	%			0.72	%			0.79	%			1.03	%
Non-performing assets to net loans and leases			0.92	%			1.09	%			1.17	%			1.38	%			1.73	%

 

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BXS Announces First Quarter Results

Page 16

April 20, 2015

 

BancorpSouth, Inc.

Selected Loan Data

(Dollars in thousands)

(Unaudited)

 

		March 31, 2015
		Pass				Special Mention				Substandard				Doubtful				Loss				Impaired				Total
LOAN PORTFOLIO BY INTERNALLY ASSIGNED GRADE:
Commercial and industrial		$	1,642,264			$	961			$	31,202			$	99			$	—			$	1,840			$	1,676,366
Real estate
Consumer mortgages			2,218,792				—				78,928				227				—				3,165				2,301,112
Home equity			527,726				—				9,706				—				—				610				538,042
Agricultural			225,990				—				10,908				—				—				—				236,898
Commercial and industrial-owner occupied			1,457,229				—				54,801				242				—				5,881				1,518,153
Construction, acquisition and development			851,938				—				37,303				329				—				3,160				892,730
Commercial real estate			1,923,659				—				59,497				300				—				10,017				1,993,473
Credit cards			106,287				—				—				—				—				—				106,287
All other			451,174				—				12,571				—				—				164				463,909
Total loans		$	9,405,059			$	961			$	294,916			$	1,197			$	—			$	24,837			$	9,726,970

 

		December 31, 2014
		Pass				Special Mention				Substandard				Doubtful				Loss				Impaired				Total
LOAN PORTFOLIO BY INTERNALLY ASSIGNED GRADE:
Commercial and industrial		$	1,709,475			$	978			$	33,879			$	—			$	—			$	2,154			$	1,746,486
Real estate
Consumer mortgages			2,167,965				—				84,975				—				—				4,786				2,257,726
Home equity			521,011				—				9,744				—				—				619				531,374
Agricultural			227,688				—				11,928				—				—				—				239,616
Commercial and industrial-owner occupied			1,450,158				—				64,420				491				—				7,467				1,522,536
Construction, acquisition and development			811,227				—				39,675				334				—				2,387				853,623
Commercial real estate			1,893,514				—				57,761				184				—				10,518				1,961,977
Credit cards			113,426				—				—				—				—				—				113,426
All other			471,662				—				14,340				—				—				170				486,172
Total loans		$	9,366,126			$	978			$	316,722			$	1,009			$	—			$	28,101			$	9,712,936

 

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BXS Announces First Quarter Results

Page 17

April 20, 2015

 

BancorpSouth, Inc.

Geographical Information

(Dollars in thousands)

(Unaudited)

 

		March 31, 2015
		Alabama and Florida Panhandle				Arkansas				Louisiana				Mississippi				Missouri				Tennessee				Texas				Other				Total
LOAN AND LEASE PORTFOLIO:
Commercial and industrial		$	189,823			$	208,990			$	217,749			$	555,594			$	77,274			$	135,672			$	267,825			$	23,439			$	1,676,366
Real estate
Consumer mortgages			195,923				286,833				193,390				774,883				68,048				239,586				374,743				167,706				2,301,112
Home equity			74,805				37,890				56,275				212,510				21,507				125,541				8,063				1,451				538,042
Agricultural			6,515				71,542				29,253				70,036				2,725				12,567				44,260				—				236,898
Commercial and industrial-owner occupied			176,298				175,152				177,340				572,800				58,596				158,062				199,905				—				1,518,153
Construction, acquisition and development			128,479				91,070				87,238				287,700				22,758				141,940				113,706				19,839				892,730
Commercial real estate			288,445				336,170				247,765				486,219				201,241				179,111				204,190				50,332				1,993,473
Credit cards			—				—				—				—				—				—				—				106,287				106,287
All other			29,303				36,893				27,073				200,233				2,603				38,034				37,469				92,301				463,909
Total loans		$	1,089,591			$	1,244,540			$	1,036,083			$	3,159,975			$	454,752			$	1,030,513			$	1,250,161			$	461,355			$	9,726,970
NON-PERFORMING LOANS AND LEASES:
Commercial and industrial		$	1,227			$	438			$	579			$	1,720			$	—			$	—			$	69			$	143			$	4,176
Real estate
Consumer mortgages			193				1,888				833				9,005				777				2,008				864				7,799				23,367
Home equity			775				43				514				319				87				528				—				3				2,269
Agricultural			79				31				14				73				—				61				—				1				259
Commercial and industrial-owner occupied			293				1,043				1,033				8,222				973				938				81				2				12,585
Construction, acquisition and development			906				196				—				1,067				255				2,692				—				2				5,118
Commercial real estate			—				259				2,082				4,147				445				4,502				300				—				11,735
Credit cards			—				—				—				—				—				—				—				1,345				1,345
All other			—				42				138				238				—				193				—				1				612
Total loans		$	3,473			$	3,940			$	5,193			$	24,791			$	2,537			$	10,922			$	1,314			$	9,296			$	61,466
NON-PERFORMING LOANS AND LEASES
AS A PERCENTAGE OF OUTSTANDING:
Commercial and industrial			0.65	%			0.21	%			0.27	%			0.31	%			0.00	%			0.00	%			0.03	%			0.61	%			0.25	%
Real estate
Consumer mortgages			0.10	%			0.66	%			0.43	%			1.16	%			1.14	%			0.84	%			0.23	%			4.65	%			1.02	%
Home equity			1.04	%			0.11	%			0.91	%			0.15	%			0.40	%			0.42	%			0.00	%			0.21	%			0.42	%
Agricultural			1.21	%			0.04	%			0.05	%			0.10	%			0.00	%			0.49	%			0.00	%			0.00	%			0.11	%
Commercial and industrial-owner occupied			0.17	%			0.60	%			0.58	%			1.44	%			1.66	%			0.59	%			0.04	%			0.00	%			0.83	%
Construction, acquisition and development			0.71	%			0.22	%			0.00	%			0.37	%			1.12	%			1.90	%			0.00	%			0.01	%			0.57	%
Commercial real estate			0.00	%			0.08	%			0.84	%			0.85	%			0.22	%			2.51	%			0.15	%			0.00	%			0.59	%
Credit cards			—				—				—				—				—				—				—				1.27	%			1.27	%
All other			0.00	%			0.11	%			0.51	%			0.12	%			0.00	%			0.51	%			0.00	%			0.00	%			0.13	%
Total loans			0.32	%			0.32	%			0.50	%			0.78	%			0.56	%			1.06	%			0.11	%			2.01	%			0.63	%

 

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BXS Announces First Quarter Results

Page 18

April 20, 2015

 

BancorpSouth, Inc.

Selected Additional Information

(Dollars in thousands)

(Unaudited)

 

		March 31, 2015
		Alabama and Florida Panhandle				Arkansas				Louisiana				Mississippi				Missouri				Tennessee				Texas				Other				Total
OTHER REAL ESTATE OWNED:
Commercial and industrial		$	84			$	—			$	—			$	—			$	—			$	—			$	—			$	—			$	84
Real estate
Consumer mortgages			264				79				25				1,289				—				38				4				—				1,699
Home equity			—				—				—				101				—				—				—				—				101
Agricultural			—				—				—				25				—				—				—				—				25
Commercial and industrial-owner occupied			199				—				—				1,424				—				307				60				—				1,990
Construction, acquisition and development			3,886				84				139				16,069				—				2,627				—				—				22,805
Commercial real estate			170				—				—				646				—				121				63				—				1,000
All other			—				27				—				99				—				59				—				—				185
Total loans		$	4,603			$	190			$	164			$	19,653			$	—			$	3,152			$	127			$	—			$	27,889
		Quarter Ended
		Mar-15				Dec-14				Sep-14				Jun-14				Mar-14
OTHER REAL ESTATE OWNED:
Balance, beginning of period		$	33,984			$	42,691			$	55,253			$	63,595			$	69,338
Additions to foreclosed properties
New foreclosed property			2,804				2,257				3,476				4,144				4,855
Reductions in foreclosed properties
Sales			(6,726	)			(8,548	)			(14,429	)			(10,269	)			(8,767	)
Writedowns			(2,173	)			(2,416	)			(1,609	)			(2,217	)			(1,831	)
Balance, end of period		$	27,889			$	33,984			$	42,691			$	55,253			$	63,595
FORECLOSED PROPERTY EXPENSE
(Gain) Loss on sale of other real estate owned		$	(779	)		$	1,643			$	3,289			$	1,073			$	466
Writedown of other real estate owned			2,173				2,416				1,609				2,217				1,831
Other foreclosed property expense			577				534				823				912				258
Total foreclosed property expense		$	1,971			$	4,593			$	5,721			$	4,202			$	2,555

 

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BXS Announces First Quarter Results

Page 19

April 20, 2015

 

BancorpSouth, Inc.

Noninterest Revenue and Expense

(Dollars in thousands)

(Unaudited)

 

		Quarter Ended
		Mar-15				Dec-14				Sep-14				Jun-14				Mar-14
NONINTEREST REVENUE:
Mortgage lending		$	8,567			$	3,250			$	6,938			$	9,089			$	3,394
Credit card, debit card and merchant fees			8,539				9,921				8,972				8,567				7,843
Deposit service charges			11,252				12,538				13,111				12,437				12,536
Securities gains, net			14				18				18				5				(4	)
Insurance commissions			33,493				25,376				29,246				28,621				31,599
Trust income			4,036				3,791				3,537				3,624				3,568
Annuity fees			558				540				461				695				772
Brokerage commissions and fees			1,616				1,495				1,963				1,509				1,576
Bank-owned life insurance			1,899				3,249				1,865				1,885				1,849
Other miscellaneous income			3,341				3,335				3,167				3,406				3,384
Total noninterest revenue		$	73,315			$	63,513			$	69,278			$	69,838			$	66,517
NONINTEREST EXPENSE:
Salaries and employee benefits		$	81,179			$	76,751			$	77,453			$	74,741			$	78,883
Occupancy, net of rental income			10,194				10,500				10,313				10,245				10,287
Equipment			3,974				3,996				4,205				4,169				4,499
Deposit insurance assessments			2,311				2,430				2,125				2,035				1,600
Amortization of bond issue cost			12				12				12				12				12
Advertising			781				1,233				1,192				1,331				632
Foreclosed property expense			1,971				4,593				5,721				4,202				2,555
Telecommunications			1,922				1,960				2,254				2,258				2,248
Public relations			570				770				950				857				822
Data processing			5,393				4,804				5,317				5,384				5,230
Computer software			2,606				2,763				2,488				2,851				2,423
Amortization of intangibles			1,032				1,111				1,126				1,148				1,058
Legal			7,681				2,322				2,620				3,002				1,878
Merger expense			(2	)			4				188				1,010				560
Postage and shipping			1,172				1,239				1,103				1,116				1,287
Other miscellaneous expense			16,137				15,558				16,632				13,593				12,733
Total noninterest expense		$	136,933			$	130,046			$	133,699			$	127,954			$	126,707
INSURANCE COMMISSIONS:
Property and casualty commissions		$	20,673			$	19,007			$	22,746			$	21,576			$	19,987
Life and health commissions			5,412				5,521				5,128				5,549				5,010
Risk management income			666				621				708				617				705
Other			6,742				227				664				879				5,897
Total insurance commissions		$	33,493			$	25,376			$	29,246			$	28,621			$	31,599

 

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BXS Announces First Quarter Results

Page 20

April 20, 2015

 

BancorpSouth, Inc.

Selected Additional Information

(Dollars in thousands)

(Unaudited)

 

		Quarter Ended
		Mar-15				Dec-14				Sep-14				Jun-14				Mar-14
MORTGAGE SERVICING RIGHTS:
Fair value, beginning of period		$	51,296			$	53,759			$	52,272			$	53,436			$	54,662
Additions to mortgage servicing rights:
Originations of servicing assets			2,499				2,453				2,400				2,565				1,460
Changes in fair value:
Due to payoffs/paydowns			(1,564	)			(1,480	)			(1,559	)			(1,616	)			(1,138	)
Due to change in valuation inputs or assumptions used in the valuation model			(3,039	)			(3,434	)			648				(2,111	)			(1,547	)
Other changes in fair value			(2	)			(2	)			(2	)			(2	)			(1	)
Fair value, end of period		$	49,190			$	51,296			$	53,759			$	52,272			$	53,436
Production revenue:
Origination		$	8,914			$	3,949			$	3,736			$	8,758			$	1,964
Servicing			4,256				4,215				4,113				4,058				4,115
Payoffs/Paydowns			(1,564	)			(1,480	)			(1,559	)			(1,616	)			(1,138	)
Total production revenue			11,606				6,684				6,290				11,200				4,941
Market value adjustment			(3,039	)			(3,434	)			648				(2,111	)			(1,547	)
Total mortgage lending revenue		$	8,567			$	3,250			$	6,938			$	9,089			$	3,394
Mortgage loans serviced		$	5,705,638			$	5,686,756			$	5,649,897			$	5,630,192			$	5,568,828
MSR/mtg loans serviced			0.86	%			0.90	%			0.95	%			0.93	%			0.96	%
AVAILABLE-FOR-SALE SECURITIES, at fair value
U.S. Government agencies		$	1,286,981			$	1,215,054			$	1,238,088			$	1,333,368			$	1,419,269
Government agency issued residential mortgage-back securities			200,381				209,230				218,748				229,414				241,596
Government agency issued commercial mortgage-back securities			227,409				240,568				237,325				237,321				234,059
Obligations of states and political subdivisions			471,539				483,864				509,304				520,897				523,811
Other			8,063				8,211				7,997				11,192				8,023
Total available-for-sale securities		$	2,194,373			$	2,156,927			$	2,211,462			$	2,332,192			$	2,426,758

 

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BXS Announces First Quarter Results

Page 21

April 20, 2015

 

BancorpSouth, Inc.

Reconciliation of Non-GAAP Measures

(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 pre-tax, pre-provision earnings, net operating income, tangible shareholders’ equity to tangible assets, return on tangible equity, pre-tax pre-provision return on average assets, tangible book value per share, and operating earnings per share. 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 Pre-tax, Pre-provision Earnings and Net Operating Income to Net Income:

 

		Quarter ended
		3/31/2015				12/31/2014				9/30/2014				6/30/2014				3/31/2014
Net income		$	32,266			$	28,660			$	28,778			$	30,868			$	28,444
Plus:    Provision for credit losses			(5,000	)			—				—				—				—
Income tax expense			15,189				11,252				12,414				14,097				12,889
Pre-tax, pre-provision earnings		$	42,455			$	39,912			$	41,192			$	44,965			$	41,333
Net income		$	32,266			$	28,660			$	28,778			$	30,868			$	28,444
Plus:    Merger expense, net of tax			(1	)			2				117				626				347
One time charge for BSA, net of tax			—				—				1,903				—				—
Net operating income		$	32,265			$	28,662			$	30,798			$	31,494			$	28,791

 

- MORE -

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BXS Announces First Quarter Results

Page 22

April 20, 2015

 

BancorpSouth, Inc.

Reconciliation of Non-GAAP Measures

(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
		3/31/2015				12/31/2014				9/30/2014				6/30/2014				3/31/2014
Tangible assets
Total assets		$	13,630,322			$	13,326,369			$	13,071,557			$	12,985,887			$	13,143,555
Less: Goodwill			291,498				291,498				291,498				291,498				286,800
Other identifiable intangible assets			23,476				24,508				25,619				26,745				25,021
Total tangible assets		$	13,315,348			$	13,010,363			$	12,754,440			$	12,667,644			$	12,831,734
Tangible shareholders’ equity
Total shareholders’ equity		$	1,645,208			$	1,606,059			$	1,610,543			$	1,588,850			$	1,554,676
Less: Goodwill			291,498				291,498				291,498				291,498				286,800
Other identifiable intangible assets			23,476				24,508				25,619				26,745				25,021
Total tangible shareholders’ equity		$	1,330,234			$	1,290,053			$	1,293,426			$	1,270,607			$	1,242,855
Total average assets		$	13,457,668			$	13,131,130			$	12,987,103			$	12,933,879			$	13,087,128
Total common shares outstanding			96,544,502				96,254,903				96,065,021				96,046,057				96,004,679
Average shares outstanding-diluted			96,653,401				96,506,827				96,373,950				96,373,121				95,952,611
Tangible shareholders’ equity to tangible assets*			9.99	%			9.92	%			10.14	%			10.03	%			9.69	%
Return on tangible equity**			9.84	%			8.81	%			8.83	%			9.74	%			9.28	%
Pre-tax pre-provision return on average assets***			1.29	%			1.21	%			1.26	%			1.39	%			1.28	%
Tangible book value per share****		$	13.78			$	13.40			$	13.46			$	13.23			$	12.95
Operating earnings per share*****		$	0.33			$	0.30			$	0.32			$	0.33			$	0.30

 

*	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.

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

***	Pre-tax pre-provision return on average assets is defined by the Company as annualized pre-tax pre-provision earnings divided by total average assets.

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

*****

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

 

- END -

Exhibit 99.2

 

 

exhibit 99.1

BancorpSouth, Inc.

Financial Information

As of and for the three months ended March 31, 2015

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Forward Looking Information

Certain statements contained in this this presentation and the accompanying slides 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 findings and results of 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 Other Real Estate Owned (“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, the impact of litigation regarding debit card fees 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 this presentation and the accompanying slides, 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, the findings and results of the CFPB and the DOJ in their review of the Company’s fair lending practices, 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 this presentation and the accompanying slides, 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 this presentation and the accompanying slides.

2

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Q1 Highlights

Net income of $32.3 million, or $0.33 per diluted share

Generated deposit growth of $280.3 million, or 10.4% annualized

Net interest margin remained stable at 3.56%

Produced $33.5 million of insurance commission revenue, the highest level of quarterly insurance commission revenue in Company history

Originated $311.1 million in mortgage loans, which contributed to mortgage lending revenue of $8.6 million

On April 7, the consent order related to Bank Secrecy Act (“BSA”) and anti-money laundering (“AML”) compliance was formally terminated

Re-filed merger applications for Ouachita Banchsares Corp. and Central Community Corporation pending transactions

As of and for the three months ended March 31, 2015 3

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Recent Quarterly Results

Three Months Ended % Change

3/31/15 12/31/14 3/31/14 vs 12/31/14 vs 3/31/14

Net interest revenue $ 106.1 $ 106.4 $ 101.5 (0.3) % 4.5 %

Provision for credit losses (5.0) 0.0 0.0 NM NM

Noninterest revenue 73.3 63.5 66.5 15.4 10.2

Noninterest expense 136.9 130.0 126.7 5.3 8.1

Income before income taxes 47.5 39.9 41.3 18.9 14.8

Income tax provision 15.2 11.3 12.9 35.0 17.8

Net income $ 32.3 $ 28.7 $ 28.4 12.6 % 13.4 %

Net income per share: diluted $ 0.33 $ 0.30 $ 0.30 10.0 % 10.0 %

Dollars in millions, except per share data 4 NM – Not Meaningful

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Noninterest Revenue

Three Months Ended % Change

3/31/15 12/31/14 3/31/14 vs 12/31/14 vs 3/31/14

Mortgage lending revenue $ 8,567 $ 3,250 $ 3,394 163.6 % 152.4 %

Credit card, debit card and merchant fees 8,539 9,921 7,843 (13.9) 8.9

Deposit service charges 11,252 12,538 12,536 (10.3) (10.2)

Insurance commissions 33,493 25,376 31,599 32.0 6.0

Wealth management 6,210 5,826 5,916 6.6 5.0

Other 5,254 6,602 5,229 (20.4) 0.5

Total noninterest revenue $ 73,315 $ 63,513 $ 66,517 15.4 % 10.2 %

% of total revenue 40.9% 37.4% 39.6%

Dollars in thousands 5

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Noninterest Expense

Three Months Ended % Change

3/31/15 12/31/14 3/31/14 vs 12/31/14 vs 3/31/14

Salaries and employee benefits $ 81,179 $ 76,751 $ 78,883 5.8 % 2.9 %

Occupancy, net of rental income 10,194 10,500 10,287 (2.9) (0.9)

Equipment 3,974 3,996 4,499 (0.6) (11.7)

Deposit insurance assessments 2,311 2,430 1,600 (4.9) 44.4

Write-off and amortization of bond issue cost 12 12 12 — —

Advertising & public relations 1,351 2,003 1,454 (32.6) (7.1)

Foreclosed property expense 1,971 4,593 2,555 (57.1) (22.9)

Data processing, telecom & computer software 9,921 9,527 9,901 4.1 0.2

Amortization of intangibles 1,032 1,111 1,058 (7.1) (2.5)

Legal 7,681 2,322 1,878 230.8 309.0

Merger expense (2) 4 560 NM NM

Postage and shipping 1,172 1,239 1,287 (5.4) (8.9)

Other miscellaneous expense 16,137 15,558 12,733 3.7 26.7

Total noninterest expense $ 136,933 $ 130,046 $ 126,707 5.3 % 8.1 %

Non-operating items:

Merger expense $ (2) $ 4 $ 560

Total $ (2) $ 4 $ 560

Dollars in thousands NM – Not Meaningful

6

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Deposits

As of % Change

Annualized

3/31/15 12/31/14 3/31/14 vs 12/31/14 vs 3/31/14

Noninterest bearing demand $ 2,915 $ 2,779 $ 2,725 19.9 % 7.0 %

Interest bearing demand 4,980 4,868 4,583 9.3 8.6

Savings 1,396 1,332 1,297 19.5 7.6

Other time 1,962 1,994 2,206 (6.4) (11.1)

Total Deposits $ 11,253 $ 10,972 $ 10,812 10.4 % 4.1 %

Customer Repos 385 388 456 (3.5) (15.7)

Total Deposits & Customer Repos $ 11,637 $ 11,361 $ 11,268 9.9 % 3.3 %

Dollars in millions 7

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Loan Portfolio

As of % Change

Annualized

3/31/15 12/31/14 3/31/14 vs 12/31/14 vs 3/31/14

Commercial and industrial $ 1,676 $ 1,746 $ 1,581 (16.3) % 6.0 %

Real estate:

Consumer mortgages 2,301 2,258 2,047 7.8 12.4

Home equity 538 531 498 5.1 8.0

Agricultural 237 240 230 (4.6) 3.2

Commercial and industrial-owner occupied 1,518 1,523 1,488 (1.2) 2.0

Construction, acquisition and development 893 854 748 18.6 19.3

Commercial 1,993 1,962 1,848 6.5 7.9

Credit Cards 106 113 106 (25.5) 0.3

Other 464 486 522 (18.6) (11.1)

Total $ 9,727 $ 9,713 $ 9,068 0.6 % 7.3 %

Dollars in millions 8 Net loans and leases

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Mortgage and Insurance Revenue

Mortgage Lending Revenue

Three Months Ended

3/31/15 12/31/14 9/30/14 6/30/14 3/31/14

Origination revenue $ 8,914 $ 3,949 $ 3,736 $ 8,758 $ 1,964

Servicing revenue 4,256 4,215 4,113 4,058 4,115

MSR payoffs/paydowns (1,564) (1,480) (1,559) (1,616) (1,138)

MSR valuation adjustment (3,039) (3,434) 648 (2,111) (1,547)

Total mortgage lending revenue $ 8,567 $ 3,250 $ 6,938 $ 9,089 $ 3,394

Production volume $ 311,115 $ 256,308 $ 305,730 $ 291,010 $ 197,110

Purchase money production $ 200,109 $ 193,154 $ 244,584 $ 241,538 $ 143,890

Mortgage loans sold $ 243,477 $ 229,070 $ 225,444 $ 264,478 $ 143,213

Margin on loans sold 3.66% 1.72% 1.66% 3.31% 1.37%

Current pipeline $ 302,721 $ 180,390 $ 178,531 $ 180,337 $ 102,873

Mortgage originators 124 122 113 110 109

Insurance Commission Revenue

Property and casualty commissions $ 20,673 $ 19,007 $ 22,746 $ 21,576 $ 19,987

Life and health commissions 5,412 5,521 5,128 5,549 5,010

Risk management income 666 621 708 617 705

Other 6,742 227 664 879 5,897

Total insurance commissions $ 33,493 $ 25,376 $ 29,246 $ 28,621 $ 31,599

Dollars in thousands 9

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Credit Quality Highlights

Negative provision for credit losses of $5.0 million, compared to no recorded provision for both the fourth quarter of 2014 and the first quarter of 2014

Non-performing loans (“NPLs”) decreased $10.3 million, or 14.3%, and non-performing assets (“NPAs”) declined $16.4 million, or 15.5%, during the first quarter

Near-term delinquencies remained low at $29.1 million

Net charge-offs were $0.8 million for the first quarter compared with $1.5 million for the fourth quarter of 2014 and $3.5 million for the first quarter of 2014

OREO decreased $6.1 million, or 18.0%, quarter over quarter

As of and for the three months ended March 31, 2015 10 “Paying as agreed” includes loans that are less than 30 days past due with payments occurring at least quarterly

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NPA Improvement

Total NPAs Have Declined Approximately 43% in the Last 12 Months

$625

$ 561

$ 528

$ 496

$500 $ 136

$ 133

$ 174

$375

$ 337

$ 103

$246

$250

$59 $ 425 $190

$ 394

$157

$ 322 $69 $129

$125 $110 $64 $112 $106

$ 234 $ 89

$46 $186 $55 $43 $34

$ 28

$64 $120 $93 $74 $69 $72 $ 61

$0

4Q 08 4Q 09 4Q 10 1Q 11 4Q 11 4Q 12 4Q 13 1Q 14 2Q 14 3Q 14 4Q 14 1Q 15

NPLs OREO

Dollars in millions NPLs consist of nonaccrual loans, loans 90+ days past due and restructured loans NPAs consist of NPLs and other real estate owned

11

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Summary

Financial Highlights

Growth in revenue contributed by noninterest lines of business? Meaningful deposit growth? Stable net interest margin? Continued credit quality improvement

Non-Financial Highlights

Consent order lifted

Re-filed merger applications for pending bank transactions? Opened loan production office in Dallas, TX

Q&A

12