BancorpSouth Announces Third Quarter 2016 Financial Results

Mittwoch, 19.10.2016 22:35 von

PR Newswire

TUPELO, Miss., Oct. 19, 2016 /PRNewswire/ -- BancorpSouth, Inc. (NYSE: BXS) today announced financial results for the quarter ended September 30, 2016.

         Highlights for the third quarter of 2016 included:

  • Net income of $37.8 million, or $0.40 per diluted share. 
     
  • Generated deposit growth of $225.7 million, or 7.9 percent on an annualized basis, and net loan growth of $82.8 million, or 3.1 percent on an annualized basis. 
     
  • Earnings benefitted from a positive mortgage servicing rights ("MSR") valuation adjustment of $1.8 million
      
  • Net operating income – excluding MSR – of $36.7 million, or $0.39 per diluted share. 
      
  • Credit quality remained stable; no recorded provision for credit losses for the quarter. 
      
  • Total non-interest expense of $129.5 million essentially flat compared to the second quarter; operating efficiency ratio – excluding MSR – remained below 70 percent for the third consecutive quarter. 
      
  • Repurchased 551,519 shares of outstanding common stock at a weighted average price of $23.80.
      
  • On October 14, 2016, the Company announced an extension of its merger agreements with Central Community Corporation and Ouachita Bancshares Corp. until December 31, 2017.    

The Company reported net income of $37.8 million, or $0.40 per diluted share, for the third quarter of 2016 compared with net income of $34.3 million, or $0.36 per diluted share, for the third quarter of 2015 and net income of $34.7 million, or $0.37 per diluted share, for the second quarter of 2016. 

The Company reported net operating income – excluding MSR – of $36.7 million, or $0.39 per diluted share, for the third quarter of 2016 compared to $37.6 million, or $0.39 per diluted share, for the third quarter of 2015 and $37.2 million, or $0.39 per diluted share, for the second quarter of 2016. 

"The recent merger agreement extensions with Central Community Corporation and Ouachita Bancshares Corp. were a positive step for our Company," remarked Dan Rollins, BancorpSouth Chairman and Chief Executive Officer.  "While we are disappointed in the length of time taken to close these transactions, we are pleased with the continued commitment of these two organizations to being a part of our team. 

"Our core financial results continue to improve quarter after quarter.  We are extremely pleased with our front line efforts in producing deposit growth.  We reported deposit growth of $225.7 million, or 7.9 percent annualized for the quarter.  We have consistently communicated to our teammates the importance of leading our sales efforts with deposits.  Our balance sheet growth contributed to meaningful growth in net interest income during the quarter.  While we did see some slight compression in net interest margin, our loan yields and deposit costs were stable compared to the second quarter.  The compression in the margin was driven primarily by balance sheet mix, as additional borrowings added to the balance sheet for liquidity purposes were deployed primarily in our securities portfolio.    

"Otherwise, our story is very consistent with the last several quarters.  Our mortgage team continues to grow and perform at a high level while our insurance team continues to battle pricing headwinds impacting the entire industry.  There was no recorded provision for credit losses for the quarter as credit quality remains stable.  Finally, total non-interest expense was essentially flat for the quarter, resulting in our efficiency ratio remaining below 70 percent." 

Net Interest Revenue

Net interest revenue was $114.6 million for the third quarter of 2016, an increase of 3.2 percent from $111.1 million for the third quarter of 2015 and an increase of 2.0 percent from $112.3 million for the second quarter of 2016.  The fully taxable equivalent net interest margin was 3.51 percent for the third quarter of 2016 compared to 3.59 percent for the third quarter of 2015 and 3.56 percent for the second quarter of 2016.  Yields on loans and leases were 4.20 percent for the third quarter of 2016 compared with 4.22 percent for the third quarter of 2015 and 4.20 percent for the second quarter of 2016, while yields on total interest earning assets were 3.74 percent for the third quarter of 2016 compared with 3.82 percent for the third quarter of 2015 and 3.78 percent for the second quarter of 2016.  The average cost of deposits was 0.22 percent for the third quarter of 2016 compared to 0.22 percent for the third quarter of 2015 and 0.21 percent for the second quarter of 2016.

Asset, Deposit and Loan Activity

Total assets were $14.6 billion at September 30, 2016 compared with $13.8 billion at September 30, 2015.  Loans and leases, net of unearned income, were $10.7 billion at September 30, 2016 compared with $10.2 billion at September 30, 2015. 

Total deposits were $11.6 billion at September 30, 2016 compared with $11.1 billion at September 30, 2015.  Time deposits were essentially flat at September 30, 2016 compared to September 30, 2015, declining $13.2 million, or 0.7 percent.  Over the same time period, interest bearing demand deposits increased $82.8 million or 1.7 percent while noninterest bearing demand deposits increased $254.9 million, or 8.4 percent and savings deposits increased $123.5 million, or 8.8 percent.

Provision for Credit Losses and Allowance for Credit Losses

Earnings for the quarter reflect no recorded provision for credit losses, compared to a negative provision of $3.0 million for the third quarter of 2015 and a provision of $2.0 million for the second quarter of 2016.  Total non-performing assets ("NPAs") were $102.3 million, or 0.96 percent of net loans and leases, at September 30, 2016 compared with $113.9 million, or 1.11 percent of net loans and leases, at September 30, 2015, and $94.9 million, or 0.90 percent of net loans and leases, at June 30, 2016. 

Net charge-offs for the third quarter of 2016 were $1.0 million, compared with net charge-offs of $2.3 million for the third quarter of 2015 and net charge-offs of $1.6 million for the second quarter of 2016.  Gross charge-offs were $3.8 million for the third quarter of 2016, compared with $7.4 million for the third quarter of 2015 and $4.3 million for the second quarter of 2016.  Gross recoveries of previously charged-off loans were $2.7 million for the third quarter of 2016, compared with $5.1 million for the third quarter of 2015 and $2.7 million for the second quarter of 2016.  Annualized net charge-offs were 0.04 percent of average loans and leases for the third quarter of 2016, compared with annualized net charge-offs of 0.09 percent for the third quarter of 2015 and annualized net charge-offs of 0.06 percent for the second quarter of 2016. 

Non-performing loans ("NPLs") were $90.9 million, or 0.85 percent of net loans and leases, at September 30, 2016, compared with $90.3 million, or 0.88 percent of net loans and leases, at September 30, 2015, and $80.2 million, or 0.76 percent of net loans and leases, at June 30, 2016.  The allowance for credit losses was $125.9 million, or 1.18 percent of net loans and leases, at September 30, 2016, compared with $133.0 million, or 1.30 percent of net loans and leases, at September 30, 2015 and $126.9 million, or 1.20 percent of net loans and leases, at June 30, 2016. 

NPLs at September 30, 2016 consisted primarily of $70.7 million of nonaccrual loans, compared with $68.6 million of nonaccrual loans at June 30, 2016.  NPLs at September 30, 2016 also included $2.3 million of loans 90 days or more past due and still accruing, compared with $1.9 million of such loans at June 30, 2016, and included restructured loans still accruing of $17.9 million at September 30, 2016, compared with $9.7 million of such loans at June 30, 2016.  Early stage past due loans, representing loans 30-89 days past due, totaled $46.7 million at September 30, 2016 compared to $31.9 million at June 30, 2016.  Other real estate owned decreased $3.3 million to $11.4 million during the third quarter of 2016 from $14.7 million at June 30, 2016. 

Noninterest Revenue

Noninterest revenue was $70.9 million for the third quarter of 2016, compared with $63.0 million for the third quarter of 2015 and $69.7 million for the second quarter of 2016.  These results included a positive MSR valuation adjustment of $1.8 million for the third quarter of 2016 compared with a negative MSR valuation adjustment of $5.3 million for the third quarter of 2015 and a negative MSR valuation adjustment of $4.1 million for the second quarter of 2016.  Valuation adjustments in the MSR asset are driven primarily by fluctuations in interest rates period over period.   

Excluding the MSR valuation adjustments, mortgage banking revenue was $10.5 million for the third quarter of 2016, compared with $7.6 million for the third quarter of 2015 and $13.1 million for the second quarter of 2016.  Mortgage origination volume for the third quarter of 2016 was $478.2 million, compared with $402.2 million for the third quarter of 2015 and $462.6 million for the second quarter of 2016.

Credit and debit card fee revenue was $9.3 million for the third quarter of 2016, compared with $9.3 million for the third quarter of 2015 and $9.5 million for the second quarter of 2016.  Deposit service charge revenue was $11.3 million for the third quarter of 2016, compared with $12.2 million for the third quarter of 2015 and $11.0 million for the second quarter of 2016.  Insurance commission revenue was $28.2 million for the third quarter of 2016, compared with $28.6 million for the third quarter of 2015 and $28.8 million for the second quarter of 2016.  Wealth management revenue was $5.3 million for the third quarter of 2016, compared with $5.6 million for the third quarter of 2015 and $5.3 million for the second quarter of 2016.    

Noninterest Expense

Noninterest expense for the third quarter of 2016 was $129.5 million, compared with $126.5 million for the third quarter of 2015 and $128.7 million for the second quarter of 2016.  Salaries and employee benefits expense was $82.1 million for the third quarter of 2016 compared to $81.4 million for the third quarter of 2015 and $81.8 million for the second quarter of 2016.  Occupancy expense was $10.4 million for the third quarter of 2016, compared with $10.8 million for the third quarter of 2015 and $10.1 million for the second quarter of 2016.  Other noninterest expense was $30.4 million for the third quarter of 2016, compared to $28.3 million for the third quarter of 2015 and $30.9 million for the second quarter of 2016. 

Capital Management

The Company's equity capitalization is comprised entirely of common stock.  BancorpSouth's ratio of shareholders' equity to assets was 11.80 percent at September 30, 2016, compared with 11.93 percent at September 30, 2015 and 12.12 percent at June 30, 2016.  The ratio of tangible shareholders' equity to tangible assets was 9.86 percent at September 30, 2016, compared with 9.88 percent at September 30, 2015 and 10.11 percent at June 30, 2016.

Estimated regulatory capital ratios at September 30, 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 12.32 percent at September 30, 2016 and total risk based capital of 13.37 percent, compared with required minimum levels of 8 percent and 10 percent, respectively, in order to qualify 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. agreed to be merged with and into the Company.  OIB operates 11 full-service banking offices along the I-20 corridor and has a loan production office in Madison, Mississippi.  As of September 30, 2016, OIB, on a consolidated basis, reported total assets of $688.1 million, total loans of $494.8 million and total deposits of $574.7 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 Ouachita Bancshares Corp. shareholders on April 8, 2014. The most recent previous extension of the merger agreement expired on December 31, 2015; however, the Company and Ouachita Bancshares Corp. entered into a new extension effective on October 13, 2016, extending the merger agreement through December 31, 2017 to allow for additional time to obtain the necessary regulatory approvals and to satisfy all closing conditions. The merger agreement remains in effect until terminated by the Board of Directors of the Company or Ouachita Bancshares Corp.  The terms of the agreement provide for a minimum total deal value of $111.1 million but also allow Ouachita Bancshares Corp. to terminate the agreement if the average closing price of the Company's common stock declines below a certain threshold prior to closing.  The transaction is expected to close shortly after receiving all required regulatory approvals, although the Company can provide no assurance that the merger will close timely or at all.

On January 21, 2014, the Company announced the signing of a definitive merger agreement with Central Community Corporation, headquartered in Temple, Texas, pursuant to which Central Community Corporation agreed to be merged with and into the Company.  Central Community Corporation is the parent company of First State Bank Central Texas ("First State Bank"), which is headquartered in Austin, Texas.  First State Bank operates 31 full-service banking offices in central Texas.  As of September 30, 2016, Central Community Corporation, on a consolidated basis, reported total assets of $1.4 billion, total loans of $619.3 million and total deposits of $1.1 billion.  Under the terms of the definitive agreement, the Company will issue approximately 7,250,000 shares of the Company's common stock plus $28.5 million in cash for all outstanding shares of Central Community Corporation's capital stock, subject to certain conditions and potential adjustments.  The merger has been unanimously approved by the Board of Directors of each company and was approved by Central Community Corporation shareholders on April 24, 2014. The most recent previous extension of the merger agreement expired on December 31, 2015; however, the Company and Central Community Corporation entered into a new extension effective on October 13, 2016, extending the merger agreement through December 31, 2017 to allow for additional time to obtain the necessary regulatory approvals and to satisfy all closing conditions. The merger agreement remains in effect until terminated by the Board of Directors of the Company or Central Community Corporation.  The terms of the agreement provide for a minimum total deal value of $202.5 million but also allow Central Community Corporation to terminate the agreement if the average closing price of the Company's common stock declines below a certain threshold prior to closing.  The transaction is expected to close shortly after receiving all required regulatory approvals, although the Company can provide no assurance that the merger will close timely or at all.

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 Form 8-K that was previously filed with the SEC on October 14, 2016.

Summary

Rollins concluded, "Our teammates have positioned our Company where I believe we can continue on the same path we have been on for several quarters.  We are growing our Company while holding expenses relatively flat.  This approach should allow us to continue to show improved operating metrics as we move forward.  I'm also pleased that we were able to utilize our share repurchase program during the quarter.  We are committed to continuing to manage and deploy capital in a manner that maximizes value for our shareholders.  Finally, I'm happy that our merger partners, Ouachita Bancshares Corp. and Central Community Corporation, further demonstrated their commitment to our proposed mergers through the extension of the merger agreements until the end of next year.  I'm hopeful that we can resolve remaining regulatory concerns in a timely manner and move forward with those transactions."

Conference Call

BancorpSouth will conduct a conference call to discuss its third quarter 2016 results on October 20, 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. (NYSE: BXS) is a financial holding company headquartered in Tupelo, Mississippi, with $14.6 billion in assets.  BancorpSouth Bank, a wholly-owned subsidiary of BancorpSouth, Inc., operates 236 full service branch locations as well as additional mortgage, insurance, and loan production offices in Alabama, Arkansas, Florida, Louisiana, Mississippi, Missouri, Tennessee and Texas, including an insurance location in Illinois.  BancorpSouth is committed to a culture of respect, diversity, and inclusion in both its workplace and communities. To learn more, visit our Community Commitment page at www.bancorpsouth.com.  Like us on Facebook; follow us on Twitter: @MyBXS; or connect with us through LinkedIn.

Forward-Looking Statements

Certain statements contained in this news release may not be based upon historical facts and are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements may be identified by their reference to a future period or periods or by the use of forward-looking terminology such as "anticipate," "believe," "could," "estimate," "expect," "foresee," "hope," "intend," "may," "might," "plan," "will," or "would" or future or conditional verb tenses and variations or negatives of such terms. These forward-looking statements include, without limitation, those relating to the terms, timing and closings of the proposed mergers with Ouachita Bancshares Corp. and Central Community Corporation, the Company's ability to operate its regulatory compliance programs consistent with federal, state and local laws, including its Bank Secrecy Act ("BSA") and anti-money laundering ("AML") compliance program and its fair lending compliance program, the Company's compliance with the consent order it entered into with the Consumer Financial Protection Bureau (the "CFPB") and the United States Department of Justice ("DOJ") related to the Company's fair lending practices (the "Consent Order"), 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, credit quality, credit losses, liquidity, off-balance sheet commitments and arrangements, valuation of mortgage servicing rights, allowance and provision for credit losses, early identification and resolution of credit issues, utilization of non-GAAP financial measures, the ability of the Company to collect all amounts due according to the contractual terms of loan agreements, the Company's reserve for losses from representation and warranty obligations, the Company's foreclosure process related to mortgage loans, the resolution of non-performing loans that are collaterally dependent, real estate values, fully-indexed interest rates, interest rate risk, interest rate sensitivity, calculation of economic value of equity, impaired loan charge-offs, diversification of the Company's revenue stream, 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 and its fair lending compliance program, the Company's ability to successfully implement and comply with the Consent Order, the ability of the Company, Ouachita Bancshares Corp. and Central Community Corporation to obtain regulatory approval of and close the proposed mergers, the willingness of Ouachita Bancshares Corp. and Central Community Corporation to proceed with the proposed mergers, the potential impact upon the Company of the delay in the closings of these proposed mergers, the impact of any ongoing, pending or threatened litigation, administrative and investigatory matters involving the Company, conditions in the financial markets and economic conditions generally, the adequacy of the Company's provision and allowance for credit losses to cover actual credit losses, the credit risk associated with real estate construction, acquisition and development loans, limitations on the Company's ability to declare and pay dividends, the availability of capital on favorable terms if and when needed, liquidity risk, governmental regulation, including the Dodd-Frank Act, and supervision of the Company's operations, the short-term and long-term impact of changes to banking capital standards on the Company's regulatory capital and liquidity, the impact of regulations on service charges on the Company's core deposit accounts, the susceptibility of the Company's business to local economic and environmental conditions, the soundness of other financial institutions, changes in interest rates, the impact of monetary policies and economic factors on the Company's ability to attract deposits or make loans, volatility in capital and credit markets, reputational risk, the impact of the loss of any key Company personnel, the impact of hurricanes or other adverse weather events, any requirement that the Company write down goodwill or other intangible assets, diversification in the types of financial services the Company offers, the 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


9/30/2016

6/30/2016

3/31/2016

12/31/2015

9/30/2015

Earnings Summary:






Interest revenue

$            122,340

$             119,423

$            117,972

$            118,050

$            118,201

Interest expense

7,750

7,107

6,813

6,820

7,131

Net interest revenue

114,590

112,316

111,159

111,230

111,070

Provision for credit losses

-

2,000

1,000

-

(3,000)

Net interest revenue, after provision






   for credit losses

114,590

110,316

110,159

111,230

114,070

Noninterest revenue

70,868

69,683

65,515

67,386

62,953

Noninterest expense

129,512

128,718

142,300

148,351

126,450

Income before income taxes

55,946

51,281

33,374

30,265

50,573

Income tax expense

18,129

16,589

10,825

9,096

16,230

Net income

$              37,817

$               34,692

$              22,549

$              21,169

$              34,343







Balance Sheet - Period End Balances






Total assets

$       14,611,483

$        14,137,160

$       13,926,398

$       13,798,662

$       13,787,424

Total earning assets

13,483,345

12,977,030

12,760,031

12,656,791

12,663,944

Total securities

2,468,199

2,103,883

2,016,373

2,082,329

2,161,125

Loans and leases, net of unearned income

10,658,761

10,575,978

10,444,697

10,372,778

10,219,576

Allowance for credit losses

125,887

126,935

126,506

126,458

133,009

Total deposits

11,590,059

11,364,367

11,486,697

11,331,161

11,141,946

Long-term debt

563,495

365,588

67,681

69,775

71,868

Total shareholders' equity

1,724,104

1,713,043

1,679,793

1,655,444

1,644,820







Balance Sheet - Average Balances






Total assets

$       14,366,759

$        14,027,786

$       13,851,661

$       13,724,595

$       13,632,581

Total earning assets

13,265,266

12,963,056

12,830,000

12,628,685

12,548,967

Total securities

2,186,889

2,069,058

2,037,739

2,110,195

2,207,935

Loans and leases, net of unearned income

10,601,481

10,513,732

10,372,925

10,321,299

10,110,995

Total deposits

11,509,764

11,437,422

11,431,480

11,182,750

11,140,542

Long-term debt

430,886

219,434

67,750

69,775

71,868

Total shareholders' equity

1,719,503

1,690,906

1,668,465

1,650,924

1,680,123







Nonperforming Assets:






Non-accrual loans and leases

$              70,725

$               68,638

$              81,926

$              83,028

$              70,237

Loans and leases 90+ days past due, still accruing

2,255

1,875

4,567

2,013

1,436

Restructured loans and leases, still accruing

17,936

9,687

7,753

9,876

18,578

Non-performing loans (NPLs)

90,916

80,200

94,246

94,917

90,251

Other real estate owned

11,391

14,658

12,685

14,759

23,696

Non-performing assets (NPAs)

$            102,307

$               94,858

$            106,931

$            109,676

$            113,947







Financial Ratios and Other Data:






Return on average assets

1.05%

0.99%

0.65%

0.61%

1.00%

Operating return on average assets-excluding MSR*

1.02%

1.07%

1.07%

0.86%

1.09%

Return on average shareholders' equity

8.75%

8.25%

5.44%

5.09%

8.11%

Operating return on average shareholders' equity-excluding MSR*

8.49%

8.84%

8.89%

7.12%

8.88%

Return on tangible equity*

10.68%

9.99%

6.63%

6.25%

10.23%

Operating return on tangible equity-excluding MSR*

10.36%

10.70%

10.84%

8.75%

11.21%

Noninterest income to average assets

1.96%

2.00%

1.90%

1.95%

1.83%

Noninterest expense to average assets

3.59%

3.69%

4.13%

4.29%

3.68%

Net interest margin-fully taxable equivalent

3.51%

3.56%

3.56%

3.58%

3.59%

Net interest rate spread

3.41%

3.47%

3.47%

3.48%

3.49%

Efficiency ratio (tax equivalent)*

68.92%

69.77%

79.39%

81.86%

71.56%

Operating efficiency ratio-excluding MSR (tax equivalent)*

69.59%

68.21%

68.66%

73.89%

69.45%

Loan/deposit ratio

91.96%

93.06%

90.93%

91.54%

91.72%

Price to earnings multiple (avg)

18.86

19.07

17.33

18.17

16.98

Market value to book value

126.59%

125.23%

119.81%

136.46%

135.80%

Market value to book value (avg)

129.73%

124.62%

116.78%

142.53%

140.68%

Market value to tangible book value

154.87%

153.53%

147.04%

168.15%

167.71%

Market value to tangible book value (avg)

158.71%

152.78%

143.33%

175.64%

173.74%

Headcount FTE

3,981

4,028

3,966

3,970

3,903







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









Credit Quality Ratios:






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

0.04%

0.06%

0.04%

0.25%

0.09%

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

0.00%

0.08%

0.04%

0.00%

(0.12%)

Allowance for credit losses to net loans and leases

1.18%

1.20%

1.21%

1.22%

1.30%

Allowance for credit losses to non-performing loans and leases

138.47%

158.27%

134.23%

133.23%

147.38%

Allowance for credit losses to non-performing assets

123.05%

133.82%

118.31%

115.30%

116.73%

Non-performing loans and leases to net loans and leases

0.85%

0.76%

0.90%

0.92%

0.88%

Non-performing assets to net loans and leases

0.96%

0.90%

1.02%

1.06%

1.11%







Equity Ratios:






Total shareholders' equity to total assets

11.80%

12.12%

12.06%

12.00%

11.93%

Tangible shareholders' equity to tangible assets*

9.86%

10.11%

10.05%

9.96%

9.88%













Capital Adequacy:






Common  Equity Tier 1 capital

12.13%

12.17%

12.14%

12.07%

12.08%

Tier 1 capital

12.32%

12.37%

12.34%

12.27%

12.29%

Total capital

13.37%

13.45%

13.43%

13.37%

13.45%

Tier 1 leverage capital

10.53%

10.66%

10.61%

10.61%

10.56%

   Estimated for current quarter












Common Share Data:






Basic earnings per share

$                  0.40

$                   0.37

$                  0.24

$                  0.22

$                  0.36

Diluted earnings per share

0.40

0.37

0.24

0.22

0.36

Operating earnings per share*

0.40

0.37

0.34

0.33

0.36

Operating earnings per share- excluding MSR*

0.39

0.39

0.39

0.31

0.39

Cash dividends per share

0.13

0.10

0.10

0.10

0.10

Book value per share

18.33

18.12

17.79

17.58

17.50

Tangible book value per share*

14.98

14.78

14.49

14.27

14.17

Market value per share (last)

23.20

22.69

21.31

23.99

23.77

Market value per share (high)

25.09

24.18

23.64

27.23

26.54

Market value per share (low)

20.98

20.19

18.69

22.44

22.09

Market value per share (avg)

23.78

22.58

20.77

25.06

24.62

Dividend payout ratio

31.17%

22.58%

41.85%

44.46%

28.01%

Total shares outstanding

94,074,740

94,546,091

94,438,626

94,162,728

93,969,994

Average shares outstanding - basic

94,303,916

94,461,025

94,369,211

94,111,408

96,202,871

Average shares outstanding - diluted

94,563,833

94,694,795

94,593,540

94,384,443

96,467,728













Yield/Rate:






(Taxable equivalent basis)






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

4.20%

4.20%

4.21%

4.15%

4.22%

Available-for-sale securities:






  Taxable

1.33%

1.40%

1.40%

1.48%

1.40%

  Tax-exempt

5.32%

5.36%

5.36%

5.32%

5.32%

Short-term investments

0.52%

0.39%

0.33%

0.22%

0.20%

  Total interest earning assets and revenue

3.74%

3.78%

3.78%

3.79%

3.82%

Deposits

0.22%

0.21%

0.21%

0.21%

0.22%

  Demand - interest bearing

0.19%

0.18%

0.17%

0.18%

0.18%

  Savings

0.12%

0.12%

0.12%

0.12%

0.12%

  Other time

0.78%

0.75%

0.73%

0.71%

0.76%

Short-term borrowings

0.15%

0.15%

0.14%

0.12%

0.12%

Total interest bearing deposits & short-term borrowings

0.30%

0.29%

0.28%

0.28%

0.30%

Junior subordinated debt

3.27%

3.23%

3.18%

2.93%

2.87%

Long-term debt

0.83%

1.21%

3.08%

2.95%

2.91%

  Total interest bearing liabilities and expense

0.34%

0.32%

0.31%

0.31%

0.32%

Interest bearing liabilities to interest earning assets

69.33%

69.47%

69.75%

69.23%

69.68%

Net interest tax equivalent adjustment

$                2,462

$                 2,493

$                2,558

$                2,601

$                2,558







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









 

 

BancorpSouth, Inc.

Consolidated Balance Sheets

(Unaudited)








Sep-16

Jun-16

Mar-16

Dec-15

Sep-15


(Dollars in thousands)

Assets






Cash and due from banks

$                172,782

$                186,381

$                197,538

$                154,192

$                159,923

Interest bearing deposits with other banks

151,944

86,472

148,915

43,777

113,068

Available-for-sale securities, at fair value

2,468,199

2,103,883

2,016,373

2,082,329

2,161,125

Loans and leases

10,685,166

10,604,547

10,475,528

10,404,326

10,254,013

  Less:  Unearned income

26,405

28,569

30,831

31,548

34,437

             Allowance for credit losses

125,887

126,935

126,506

126,458

133,009

Net loans and leases

10,532,874

10,449,043

10,318,191

10,246,320

10,086,567

Loans held for sale

204,441

210,698

150,046

157,907

170,175

Premises and equipment, net

305,245

305,694

306,765

308,125

304,317

Accrued interest receivable

41,583

39,645

41,401

40,901

41,599

Goodwill

294,901

294,901

291,498

291,498

291,498

Other identifiable intangibles

19,908

20,831

19,664

20,545

21,466

Bank owned life insurance

257,015

255,240

253,427

251,534

249,825

Other real estate owned

11,391

14,658

12,685

14,759

23,696

Other assets

151,200

169,714

169,895

186,775

164,165

Total Assets

$           14,611,483

$           14,137,160

$           13,926,398

$           13,798,662

$           13,787,424

Liabilities






Deposits:






  Demand:  Noninterest bearing

$             3,308,361

$             3,133,460

$             3,103,321

$             3,031,528

$             3,053,439

                  Interest bearing

4,877,482

4,838,704

5,033,565

5,003,806

4,794,656

  Savings

1,533,401

1,512,694

1,506,942

1,442,336

1,409,856

  Other time

1,870,815

1,879,509

1,842,869

1,853,491

1,883,995

Total deposits

11,590,059

11,364,367

11,486,697

11,331,161

11,141,946

Federal funds purchased and






    securities sold under agreement






    to repurchase

468,969

415,949

431,089

405,937

425,203

Short-term Federal Home Loan Bank borrowings






   and other short-term borrowing

-

-

-

62,000

224,500

Accrued interest payable

4,107

3,727

3,305

3,071

3,353

Junior subordinated debt securities

23,198

23,198

23,198

23,198

23,198

Long-term debt

563,495

365,588

67,681

69,775

71,868

Other liabilities

237,551

251,288

234,635

248,076

252,536

Total Liabilities

12,887,379

12,424,117

12,246,605

12,143,218

12,142,604

Shareholders' Equity






Common stock

235,187

236,365

236,097

235,407

234,925

Capital surplus

278,973

286,994

283,800

282,934

278,998

Accumulated other comprehensive loss

(33,549)

(27,587)

(32,144)

(41,825)

(36,355)

Retained earnings

1,243,493

1,217,271

1,192,040

1,178,928

1,167,252

Total Shareholders' Equity

1,724,104

1,713,043

1,679,793

1,655,444

1,644,820

Total Liabilities & Shareholders' Equity

$           14,611,483

$           14,137,160

$           13,926,398

$           13,798,662

$           13,787,424







 

 

BancorpSouth, Inc.

Consolidated Average Balance Sheets

(Unaudited)








Sep-16

Jun-16

Mar-16

Dec-15

Sep-15


(Dollars in thousands)

Assets






Cash and due from banks

$                157,233

$                117,193

$                  71,528

$                159,696

$                159,569

Interest bearing deposits with other banks

311,545

237,635

316,108

69,552

72,438

Available-for-sale securities, at fair value

2,186,889

2,069,058

2,037,739

2,110,195

2,207,935

Loans and leases

10,629,522

10,543,795

10,405,063

10,353,913

10,144,874

  Less:  Unearned income

28,041

30,063

32,138

32,614

33,879

             Allowance for credit losses

126,820

126,103

126,567

132,375

137,547

Net loans and leases

10,474,661

10,387,629

10,246,358

10,188,924

9,973,448

Loans held for sale

165,351

142,632

103,227

127,638

157,598

Premises and equipment, net

305,707

307,600

308,065

306,881

304,948

Accrued interest receivable

38,125

36,887

38,306

38,142

38,847

Goodwill

294,901

292,620

291,498

291,498

291,498

Other identifiable intangibles

20,248

19,796

19,987

20,880

21,812

Bank owned life insurance

255,967

254,191

252,422

250,577

248,798

Other real estate owned

13,664

15,666

14,523

21,049

24,008

Other assets

142,468

146,879

151,900

139,563

131,682

Total Assets

$           14,366,759

$           14,027,786

$           13,851,661

$           13,724,595

$           13,632,581

Liabilities






Deposits:






  Demand:  Noninterest bearing

$             3,221,539

$             3,122,153

$             3,014,896

$             3,106,947

$             2,992,903

                  Interest bearing

4,886,920

4,957,827

5,102,648

4,782,234

4,822,567

  Savings

1,525,016

1,510,250

1,468,262

1,421,361

1,413,187

  Other time

1,876,289

1,847,192

1,845,674

1,872,208

1,911,885

Total deposits

11,509,764

11,437,422

11,431,480

11,182,750

11,140,542

Federal funds purchased and






    securities sold under agreement






    to repurchase

454,826

443,340

431,260

466,865

439,503

Short-term Federal Home Loan Bank borrowings






   and other short-term borrowing

11

4,275

10,484

107,408

62,136

Accrued interest payable

3,950

3,509

3,248

3,340

3,600

Junior subordinated debt securities

23,198

23,198

23,198

23,198

23,198

Long-term debt

430,886

219,434

67,750

69,775

71,868

Other liabilities

224,621

205,702

215,776

220,335

211,611

Total Liabilities

12,647,256

12,336,880

12,183,196

12,073,671

11,952,458

Shareholders' Equity






Common stock

235,860

236,176

235,946

235,227

240,473

Capital surplus

283,437

284,818

282,796

282,076

325,118

Accumulated other comprehensive loss

(29,743)

(32,820)

(36,184)

(38,618)

(40,476)

Retained earnings

1,229,949

1,202,732

1,185,907

1,172,239

1,155,008

Total Shareholders' Equity

1,719,503

1,690,906

1,668,465

1,650,924

1,680,123

Total Liabilities & Shareholders' Equity

$           14,366,759

$           14,027,786

$           13,851,661

$           13,724,595

$           13,632,581







 

 

BancorpSouth, Inc.

Consolidated Condensed Statements of Income

(Dollars in thousands, except per share data)

(Unaudited)
















Quarter Ended


YTD


Sep-16


Jun-16


Mar-16


Dec-15


Sep-15


Sep-16


Sep-15

INTEREST REVENUE:














Loans and leases

$  111,605


$  109,078


$   107,805


$  107,164


$  107,086


$ 328,488


$ 312,649

Deposits with other banks

409


229


263


40


36


901


398

Available-for-sale securities:














    Taxable

6,189


6,009


5,888


6,550


6,490


18,086


19,758

    Tax-exempt

2,898


2,924


3,032


3,137


3,226


8,854


9,938

Loans held for sale

1,239


1,183


984


1,159


1,363


3,406


3,585

        Total interest revenue

122,340


119,423


117,972


118,050


118,201


359,735


346,328















INTEREST EXPENSE:














Interest bearing demand

2,361


2,208


2,163


2,166


2,209


6,732


6,654

Savings

462


451


443


434


431


1,356


1,269

Other time

3,661


3,436


3,354


3,356


3,646


10,451


11,481

Federal funds purchased and securities sold














   under agreement to repurchase

173


159


140


112


104


472


271

Long-term debt

902


665


530


581


571


2,097


1,704

Junior subordinated debt

190


187


183


171


168


560


496

Other

1


1


-


-


2


2


1

        Total interest expense

7,750


7,107


6,813


6,820


7,131


21,670


21,876















        Net interest revenue

114,590


112,316


111,159


111,230


111,070


338,065


324,452

  Provision for credit losses

-


2,000


1,000


-


(3,000)


3,000


(13,000)

        Net interest revenue, after provision for














          credit losses

114,590


110,316


110,159


111,230


114,070


335,065


337,452















NONINTEREST REVENUE:














Mortgage banking

12,282


9,043


2,618


10,522


2,339


23,943


25,008

Credit card, debit card and merchant fees

9,292


9,495


8,961


9,414


9,282


27,748


27,119

Deposit service charges

11,313


11,018


11,014


11,836


12,150


33,345


34,929

Security gains, net

1


86


2


48


33


89


88

Insurance commissions

28,194


28,803


33,249


25,348


28,584


90,246


91,396

Wealth Management

5,312


5,347


5,109


5,375


5,567


15,768


17,285

Other

4,474


5,891


4,562


4,843


4,998


14,927


14,757

        Total noninterest revenue

70,868


69,683


65,515


67,386


62,953


206,066


210,582















NONINTEREST EXPENSE:














Salaries and employee benefits

82,079


81,832


82,467


80,177


81,354


246,378


242,292

Occupancy, net of rental income

10,412


10,109


10,273


10,434


10,819


30,794


31,432

Equipment

3,423


3,295


3,765


3,569


3,742


10,483


11,740

Deposit insurance assessments

3,227


2,582


2,288


2,630


2,191


8,097


6,879

Regulatory settlement

-


-


10,277


-


-


10,277


-

Other

30,371


30,900


33,230


51,541


28,344


94,501


99,217

        Total noninterest expense

129,512


128,718


142,300


148,351


126,450


400,530


391,560

        Income before income taxes

55,946


51,281


33,374


30,265


50,573


140,601


156,474

Income tax expense

18,129


16,589


10,825


9,096


16,230


45,543


50,152

        Net income

$    37,817


$   34,692


$     22,549


$    21,169


$   34,343


$  95,058


$ 106,322















Net income per share: Basic

$       0.40


$       0.37


$        0.24


$       0.22


$       0.36


$      1.01


$      1.10

                                  Diluted

$       0.40


$       0.37


$        0.24


$       0.22


$       0.36


$      1.00


$      1.10















 

 

BancorpSouth, Inc.

Selected Loan Data

(Dollars in thousands)

(Unaudited)












Quarter Ended


Sep-16


Jun-16


Mar-16


Dec-15


Sep-15

LOAN AND LEASE PORTFOLIO:










Commercial and industrial

$  1,616,152


$   1,698,089


$   1,716,477


$    1,747,774


$  1,710,497

Real estate










   Consumer mortgages

2,611,387


2,549,989


2,480,828


2,472,202


2,447,132

   Home equity

622,566


614,686


605,228


589,752


573,566

   Agricultural

242,171


251,566


239,422


259,360


252,381

   Commercial and industrial-owner occupied

1,668,477


1,644,618


1,654,577


1,617,429


1,605,811

   Construction, acquisition and development

1,121,386


1,021,218


966,362


945,045


900,875

   Commercial real estate

2,240,717


2,254,653


2,233,742


2,188,048


2,141,398

Credit cards

107,447


108,101


106,714


112,165


109,576

All other

428,458


433,058


441,347


441,003


478,340

     Total loans

$ 10,658,761


$ 10,575,978


$ 10,444,697


$  10,372,778


$ 10,219,576











ALLOWANCE FOR CREDIT LOSSES:










Balance, beginning of period

$     126,935


$      126,506


$     126,458


$       133,009


$     138,312











Loans and leases charged-off:










Commercial and industrial

(1,180)


(748)


(140)


(6,193)


(2,010)

Real estate










   Consumer mortgages

(595)


(477)


(710)


(1,146)


(1,382)

   Home equity

(237)


(224)


(550)


(147)


(314)

   Agricultural

(89)


(10)


(11)


(16)


(9)

   Commercial and industrial-owner occupied

(261)


(660)


(154)


(357)


(645)

   Construction, acquisition and development

(5)


(280)


(226)


(221)


(203)

   Commercial real estate

(14)


(870)


(245)


(122)


(1,477)

Credit cards

(696)


(614)


(720)


(723)


(706)

All other

(713)


(417)


(487)


(623)


(628)

     Total loans charged-off

(3,790)


(4,300)


(3,243)


(9,548)


(7,374)











Recoveries:










Commercial and industrial

263


339


212


354


897

Real estate










   Consumer mortgages

327


499


455


596


461

   Home equity

109


246


80


123


90

   Agricultural

28


96


36


20


59

   Commercial and industrial-owner occupied

117


101


125


307


1,831

   Construction, acquisition and development

382


524


272


1,061


1,084

   Commercial real estate

1,043


509


683


149


187

Credit cards

262


199


181


152


170

All other

211


216


247


235


292

     Total recoveries

2,742


2,729


2,291


2,997


5,071











Net charge-offs

(1,048)


(1,571)


(952)


(6,551)


(2,303)











Provision charged to operating expense

-


2,000


1,000


-


(3,000)

Balance, end of period

$     125,887


$      126,935


$     126,506


$       126,458


$     133,009











Average loans for period

$ 10,601,481


$ 10,513,732


$ 10,372,925


$  10,321,299


$ 10,110,995











Ratio:










Net charge-offs to average loans (annualized)

0.04%


0.06%


0.04%


0.25%


0.09%











 

 

BancorpSouth, Inc.

Selected Loan Data

(Dollars in thousands)

(Unaudited)












Quarter Ended


Sep-16


Jun-16


Mar-16


Dec-15


Sep-15

NON-PERFORMING ASSETS










NON-PERFORMING LOANS AND LEASES:










  Nonaccrual Loans and Leases










    Commercial and industrial

$    11,659


$         8,675


$       10,248


$      8,493


$       15,697

    Real estate










       Consumer mortgages

20,196


19,309


22,968


21,637


21,959

       Home equity

3,721


2,734


3,564


4,021


3,664

       Agricultural

1,194


1,107


932


921


484

       Commercial and industrial-owner occupied

11,983


16,021


16,633


16,512


12,690

       Construction, acquisition and development

6,939


6,086


7,720


9,130


4,240

       Commercial real estate

14,793


14,197


19,417


21,741


10,730

    Credit cards

121


159


188


188


215

    All other

119


350


256


385


558

         Total nonaccrual loans and leases

$    70,725


$       68,638


$       81,926


$    83,028


$       70,237











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

2,255


1,875


4,567


2,013


1,436

  Restructured Loans and Leases, Still Accruing

17,936


9,687


7,753


9,876


18,578

     Total non-performing loans and leases

90,916


80,200


94,246


94,917


90,251











OTHER REAL ESTATE OWNED:

11,391


14,658


12,685


14,759


23,696











Total Non-performing Assets

$  102,307


$       94,858


$      106,931


$  109,676


$      113,947











Additions to Nonaccrual Loans and Leases During the Quarter

$    17,319


$       10,553


$       15,933


$    34,050


$       22,271











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










    Commercial and industrial

$      6,736


$         3,748


$         3,758


$      2,409


$         4,985

    Real estate










       Consumer mortgages

15,443


15,784


11,985


15,128


10,789

       Home equity

3,854


2,842


2,414


2,456


1,455

       Agricultural

616


367


240


303


393

       Commercial and industrial-owner occupied

1,712


2,854


669


1,018


3,888

       Construction, acquisition and development

1,272


1,137


1,489


1,070


1,218

       Commercial real estate

15,221


3,776


1,831


830


798

    Credit cards

774


677


569


677


788

    All other

1,089


712


606


744


1,334

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

$    46,717


$       31,897


$       23,561


$    24,635


$       25,648











Credit Quality Ratios:










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

0.00%


0.08%


0.04%


0.00%


(0.12%)

Allowance for credit losses to net loans and leases

1.18%


1.20%


1.21%


1.22%


1.30%

Allowance for credit losses to non-performing loans and leases

138.47%


158.27%


134.23%


133.23%


147.38%

Allowance for credit losses to non-performing assets

123.05%


133.82%


118.31%


115.30%


116.73%

Non-performing loans and leases to net loans and leases

0.85%


0.76%


0.90%


0.92%


0.88%

Non-performing assets to net loans and leases

0.96%


0.90%


1.02%


1.06%


1.11%











 

 

BancorpSouth, Inc.





Selected Loan Data





(Dollars in thousands)





(Unaudited)




















September 30, 2016




Special












Pass


Mention


Substandard


Doubtful


Loss


Impaired


Total

LOAN PORTFOLIO BY INTERNALLY ASSIGNED GRADE:














Commercial and industrial

$  1,567,073


$                -


$       42,117


$        774


$                -


$    6,188


$   1,616,152

Real estate














   Consumer mortgages

2,549,780


528


59,727


89


-


1,263


2,611,387

   Home equity

610,313


-


10,766


-


-


1,487


622,566

   Agricultural

230,891


-


10,639


-


-


641


242,171

   Commercial and industrial-owner occupied

1,619,545


512


39,135


-


-


9,285


1,668,477

   Construction, acquisition and development

1,103,739


-


11,308


-


-


6,339


1,121,386

   Commercial real estate

2,188,170


-


38,637


-


-


13,910


2,240,717

Credit cards

107,447


-


-


-


-


-


107,447

All other

420,838


-


7,620


-


-


-


428,458

     Total loans

$ 10,397,796


$         1,040


$      219,949


$        863


$                -


$  39,113


$ 10,658,761






























June 30, 2016




Special












Pass


Mention


Substandard


Doubtful


Loss


Impaired


Total

LOAN PORTFOLIO BY INTERNALLY ASSIGNED GRADE:














Commercial and industrial

$  1,654,279


$                -


$       36,866


$          91


$            384


$    6,469


$   1,698,089

Real estate














   Consumer mortgages

2,482,105


298


66,614


14


-


958


2,549,989

   Home equity

603,039


-


10,163


-


-


1,484


614,686

   Agricultural

242,721


-


8,085


-


-


760


251,566

   Commercial and industrial-owner occupied

1,585,978


516


45,682


375


-


12,067


1,644,618

   Construction, acquisition and development

1,003,045


-


12,809


-


-


5,364


1,021,218

   Commercial real estate

2,202,501


-


38,867


151


-


13,134


2,254,653

Credit cards

108,101


-


-


-


-


-


108,101

All other

424,932


-


8,027


99


-


-


433,058

     Total loans

$ 10,306,701


$            814


$      227,113


$        730


$            384


$  40,236


$ 10,575,978















 

 

BancorpSouth, Inc.

Geographical Information

(Dollars in thousands)

(Unaudited)




















September 30, 2016


Alabama


















and Florida


















Panhandle


Arkansas


Louisiana


Mississippi


Missouri


Tennessee


Texas


Other


Total

LOAN AND LEASE PORTFOLIO:


















Commercial and industrial

$   135,467


$   205,833


$   184,819


$   639,204


$     78,950


$   116,203


$   214,287


$     41,389


$  1,616,152

Real estate


















   Consumer mortgages

335,856


325,793


226,092


831,986


84,046


294,218


484,806


28,590


2,611,387

   Home equity

96,539


43,963


69,255


227,952


23,328


144,835


14,836


1,858


622,566

   Agricultural

7,734


81,798


27,160


67,213


5,032


12,864


40,052


318


242,171

   Commercial and industrial-owner occupied

195,572


178,681


200,406


662,735


49,901


140,843


240,339


-


1,668,477

   Construction, acquisition and development

127,828


101,148


58,844


353,188


24,535


163,247


292,596


-


1,121,386

   Commercial real estate

284,543


356,121


223,016


608,483


199,928


196,105


372,521


-


2,240,717

Credit cards

-


-


-


-


-


-


-


107,447


107,447

All other

70,487


45,925


28,675


174,356


3,562


30,749


55,727


18,977


428,458

     Total loans

$ 1,254,026


$ 1,339,262


$ 1,018,267


$3,565,117


$   469,282


$ 1,099,064


$ 1,715,164


$   198,579


$ 10,658,761



















NON-PERFORMING LOANS AND LEASES:


















Commercial and industrial

$         167


$         509


$       3,191


$      5,598


$         402


$         379


$       1,586


$       2,645


$       14,477

Real estate


















   Consumer mortgages

1,197


3,749


2,950


10,148


614


1,840


2,593


187


23,278

   Home equity

559


1,311


530


720


81


520


-


2


3,723

   Agricultural

-


30


50


1,191


-


-


-


1


1,272

   Commercial and industrial-owner occupied

1,372


1,967


1,790


7,691


317


574


616


-


14,327

   Construction, acquisition and development

77


631


19


6,359


50


-


43


-


7,179

   Commercial real estate

705


1,146


1,411


18,134


-


15


155


-


21,566

Credit cards

-


-


-


-


-


-


-


1,353


1,353

All other

-


680


32


135


-


21


2,872


1


3,741

     Total loans

$       4,077


$     10,023


$       9,973


$    49,976


$       1,464


$       3,349


$       7,865


$       4,189


$       90,916



















NON-PERFORMING LOANS AND LEASES


















   AS A PERCENTAGE OF OUTSTANDING:


















Commercial and industrial

0.12%


0.25%


1.73%


0.88%


0.51%


0.33%


0.74%


6.39%


0.90%

Real estate


















   Consumer mortgages

0.36%


1.15%


1.30%


1.22%


0.73%


0.63%


0.53%


0.65%


0.89%

   Home equity

0.58%


2.98%


0.77%


0.32%


0.35%


0.36%


0.00%


0.11%


0.60%

   Agricultural

0.00%


0.04%


0.18%


1.77%


0.00%


0.00%


0.00%


N/A


0.53%

   Commercial and industrial-owner occupied

0.70%


1.10%


0.89%


1.16%


0.64%


0.41%


0.26%


N/A


0.86%

   Construction, acquisition and development

0.06%


0.62%


0.03%


1.80%


0.20%


0.00%


0.01%


N/A


0.64%

   Commercial real estate

0.25%


0.32%


0.63%


2.98%


0.00%


0.01%


0.04%


N/A


0.96%

Credit cards

N/A


N/A


N/A


N/A


N/A


N/A


N/A


1.26%


1.26%

All other

0.00%


1.48%


0.11%


0.08%


0.00%


0.07%


5.15%


0.01%


0.87%

     Total loans

0.33%


0.75%


0.98%


1.40%


0.31%


0.30%


0.46%


2.11%


0.85%



















 

 

BancorpSouth, Inc.





Noninterest Revenue and Expense





(Dollars in thousands)





(Unaudited)




















Quarter Ended


YTD


Sep-16


Jun-16


Mar-16


Dec-15


Sep-15


Sep-16


Sep-15

NONINTEREST REVENUE:














Mortgage banking excl. MSR market value adjustment

$    10,469


$       13,135


$       10,572


$      7,657


$         7,647


$  34,176


$  29,034

MSR market value adjustment

1,813


(4,092)


(7,954)


2,865


(5,308)


(10,233)


(4,026)

Credit card, debit card and merchant fees

9,292


9,495


8,961


9,414


9,282


27,748


27,119

Deposit service charges

11,313


11,018


11,014


11,836


12,150


33,345


34,929

Securities gains, net

1


86


2


48


33


89


88

Insurance commissions

28,194


28,803


33,249


25,348


28,584


90,246


91,396

Trust income

3,641


3,493


3,430


3,469


3,653


10,564


11,232

Annuity fees

446


465


477


449


539


1,388


1,567

Brokerage commissions and fees

1,225


1,389


1,202


1,457


1,375


3,816


4,486

Bank-owned life insurance

1,775


1,813


1,893


1,881


1,842


5,481


5,576

Other miscellaneous income

2,699


4,078


2,669


2,962


3,156


9,446


9,181

     Total noninterest revenue

$    70,868


$       69,683


$       65,515


$    67,386


$       62,953


$ 206,066


$ 210,582















NONINTEREST EXPENSE:














Salaries and employee benefits

$    82,079


$       81,832


$       82,467


$    80,177


$       81,354


246,378


$ 242,292

Occupancy, net of rental income

10,412


10,109


10,273


10,434


10,819


30,794


31,432

Equipment

3,423


3,295


3,765


3,569


3,742


10,483


11,740

Deposit insurance assessments

3,227


2,582


2,288


2,630


2,191


8,097


6,879

Regulatory settlement

-


-


10,277


-


-


10,277


-

Advertising

925


1,043


633


1,009


812


2,601


3,279

Foreclosed property expense

859


1,309


1,181


3,014


808


3,349


4,404

Telecommunications

1,288


1,259


1,295


1,322


1,267


3,842


3,904

Public relations

718


599


661


702


588


1,978


2,067

Data processing

6,856


6,685


6,391


6,092


6,156


19,932


18,056

Computer software

2,976


2,732


2,660


2,609


2,595


8,368


7,891

Amortization of intangibles

923


869


880


922


948


2,672


3,041

Legal

1,064


1,754


4,535


19,434


1,233


7,353


10,912

Merger expense

-


1


1


13


8


2


12

Postage and shipping

1,059


985


1,117


1,139


1,030


3,161


3,396

Other miscellaneous expense

13,703


13,664


13,876


15,285


12,899


41,243


42,255

     Total noninterest expense

$  129,512


$      128,718


$      142,300


$  148,351


$      126,450


$ 400,530


$ 391,560















INSURANCE COMMISSIONS:














Property and casualty commissions

$    20,927


$       20,417


$       19,877


$    18,814


$       21,155


61,221


$  62,973

Life and health commissions

5,897


6,252


5,615


5,823


5,775


17,764


17,389

Risk management income

674


592


623


672


709


1,889


2,012

Other

696


1,542


7,134


39


945


9,372


9,022

     Total insurance commissions

$    28,194


$       28,803


$       33,249


$    25,348


$       28,584


$  90,246


$  91,396















 

 

BancorpSouth, Inc.

Selected Additional Information

(Dollars in thousands)

(Unaudited)












Quarter Ended


Sep-16


Jun-16


Mar-16


Dec-15


Sep-15

MORTGAGE SERVICING RIGHTS:










Fair value, beginning of period

$      48,108


$        50,544


$        57,268


$      52,973


$        55,924

Additions to mortgage servicing rights:










   Originations of servicing assets

4,349


3,723


2,612


3,065


4,231

Changes in fair value:










   Due to payoffs/paydowns

(2,338)


(2,066)


(1,380)


(1,633)


(1,872)

   Due to change in valuation inputs or










     assumptions used in the valuation model

1,813


(4,092)


(7,954)


2,865


(5,308)

   Other changes in fair value

(2)


(1)


(2)


(2)


(2)

Fair value, end of period

$      51,930


$        48,108


$        50,544


$      57,268


$        52,973











Production revenue:










   Origination

$        8,168


$        10,523


$          7,208


$        4,909


$          5,154

   Servicing

4,639


4,678


4,744


4,381


4,365

   Payoffs/Paydowns

(2,338)


(2,066)


(1,380)


(1,633)


(1,872)

     Total production revenue

10,469


13,135


10,572


7,657


7,647

Market value adjustment

1,813


(4,092)


(7,954)


2,865


(5,308)

Total mortgage banking revenue

$      12,282


$          9,043


$          2,618


$      10,522


$          2,339











Mortgage loans serviced

$ 6,285,027


$   6,156,258


$   6,096,220


$ 6,011,236


$   5,942,736

MSR/mtg loans serviced

0.83%


0.78%


0.83%


0.95%


0.89%











AVAILABLE-FOR-SALE SECURITIES, at fair value










U.S. Government agencies

$ 1,691,866


$   1,310,803


$   1,196,167


$ 1,244,640


$   1,255,717

Government agency issued residential










   mortgage-back securities

184,095


180,178


189,741


140,540


206,878

Government agency issued commercial










   mortgage-back securities

178,827


193,475


207,908


260,693


229,922

Obligations of states and political subdivisions

384,995


399,391


408,537


417,499


451,600

Other

28,416


20,036


14,020


18,957


17,008

Total available-for-sale securities

$ 2,468,199


$   2,103,883


$   2,016,373


$ 2,082,329


$   2,161,125











 

 

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, operating earnings per share-excluding MSR, efficiency ratio (tax equivalent) and operating efficiency ratio-excluding MSR (tax equivalent).  The Company has included these non-GAAP financial measures in this news release for the applicable periods presented.  Management believes that the presentation of these non-GAAP financial measures (i) provides important supplemental information that contributes to a proper understanding of the Company's capital position and operating performance, (ii) enables a more complete understanding of factors and trends affecting the Company's business and (iii) allows investors to evaluate the Company's performance in a manner similar to management, the financial services industry, bank stock analysts and bank regulators.  Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures are presented in the tables below.  These non-GAAP financial measures should not be considered as substitutes for GAAP financial measures, and the Company strongly encourages investors to review the GAAP financial measures included in this news release and not to place undue reliance upon any single financial measure.  In addition, because non-GAAP financial measures are not standardized, it may not be possible to compare the non-GAAP financial measures presented in this news release with other companies' non-GAAP financial measures having the same or similar names.













Reconciliation of Net Operating Income and Net Operating Income-Excluding MSR to Net Income:
















Quarter ended




9/30/2016


6/30/2016


3/31/2016


12/31/2015


9/30/2015













Net income


$          37,817


$          34,692


$          22,549


$          21,169


$         34,343

Plus:

Merger expense, net of tax


-


1


1


8


5


Legal charge, net of tax


-


-


-


10,246


-


Regulatory related charges, net of tax


-


-


9,412


-


-

Less:

Security gains, net of tax


-


53


2


30


20

Net operating income


$          37,817


$          34,640


$          31,960


$          31,393


$         34,328













Less:

MSR market value adjustment, net of tax


1,124


(2,537)


(4,931)


1,776


(3,291)

Net operating income-excluding MSR


$          36,693


$          37,177


$          36,891


$          29,617


$         37,619













 

 

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




9/30/2016


6/30/2016


3/31/2016


12/31/2015


9/30/2015

Tangible assets











Total assets



$    14,611,483


$    14,137,160


$    13,926,398


$    13,798,662


$   13,787,424

Less:  

Goodwill


294,901


294,901


291,498


291,498


291,498


Other identifiable intangible assets


19,908


20,831


19,664


20,545


21,466

Total tangible assets


$    14,296,674


$    13,821,428


$    13,615,236


$    13,486,619


$   13,474,460













Tangible shareholders' equity











Total shareholders' equity


$     1,724,104


$     1,713,043


$     1,679,793


$      1,655,444


$    1,644,820

Less:

Goodwill


294,901


294,901


291,498


291,498


291,498


Other identifiable intangible assets


19,908


20,831


19,664


20,545


21,466

Total tangible shareholders' equity


$     1,409,295


$     1,397,311


$     1,368,631


$      1,343,401


$    1,331,856













Total average assets


$    14,366,759


$    14,027,786


$    13,851,661


$    13,724,595


$   13,632,581

Total common shares outstanding


94,074,740


94,546,091


94,438,626


94,162,728


93,969,994

Average shares outstanding-diluted


94,563,833


94,694,795


94,593,540


94,384,443


96,467,728













Tangible shareholders' equity to tangible assets (1)


9.86%


10.11%


10.05%


9.96%


9.88%

Return on tangible equity (2)


10.68%


9.99%


6.63%


6.25%


10.23%

Operating return on tangible equity-excluding MSR (3)


10.36%


10.70%


10.84%


8.75%


11.21%

Operating return on average assets-excluding MSR (4)


1.02%


1.07%


1.07%


0.86%


1.09%

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


8.49%


8.84%


8.89%


7.12%


8.88%

Tangible book value per share (6)


$           14.98


$           14.78


$           14.49


$            14.27


$          14.17

Operating earnings per share (7)


$             0.40


$             0.37


$             0.34


$              0.33


$            0.36

Operating earnings per share-excluding MSR (8)


$             0.39


$             0.39


$             0.39


$              0.31


$            0.39

























 


(1)

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













(2)

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













(3)

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













(4)

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













(5)

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













(6)

Tangible book value per share is defined by the Company as tangible shareholders' equity divided by total 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.  













 

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SOURCE BancorpSouth, Inc.