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Bancorpsouth Inc (BXS) SEC Filing 8-K Material Event for the period ending Wednesday, October 18, 2017

Bancorpsouth Inc

CIK: 701853 Ticker: BXS

Exhibit 99.1

News Release

 

LOGO

 

Contact:   

John G. Copeland

Senior Executive Vice President and

    Chief Financial Officer

662/680-2536

  

Will Fisackerly

Senior Vice President and

    Director of Corporate Finance

662/680-2475

BancorpSouth Announces Third Quarter 2017 Financial Results

TUPELO, MS, October 18, 2017/PRNewswire — BancorpSouth, Inc. (NYSE: BXS) today announced financial results for the quarter ended September 30, 2017.

Highlights for the third quarter of 2017 included:

 

    Net income of $39.5 million, or $0.43 per diluted share.

 

    Net operating income – excluding MSR – of $39.6 million, or $0.43 per diluted share.

 

    Net interest margin increased to 3.58 percent.

 

    Credit quality remained strong; recorded provision for credit losses of $0.5 million for the quarter.

 

    Total operating expense declined compared to the second quarter of 2017 and the third quarter of 2016 and operating efficiency ratio – excluding MSR – improved to 67.2 percent.

 

    Repurchased 699,888 shares of outstanding common stock at a weighted average price of $28.99 per share.

 

    Announced a corporate entity restructuring, whereby the holding company structure will be eliminated through the merger of BancorpSouth, Inc. with and into its wholly owned subsidiary, BancorpSouth Bank (the “Bank”) with the Bank continuing as the surviving entity (the “Reorganization”).

 

    On October 6, 2017, the Bank received results from the Federal Deposit Insurance Corporation (the “FDIC”) 2017 Community Reinvestment Act (“CRA”) examination, which reflected an overall CRA rating of “Satisfactory”.

The Company reported net income of $39.5 million, or $0.43 per diluted share, for the third quarter of 2017 compared with net income of $37.8 million, or $0.40 per diluted share, for the third quarter of 2016 and net income of $37.9 million, or $0.41 per diluted share, for the second quarter of 2017.

 

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BXS Announces Third Quarter 2017 Financial Results

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The Company reported net operating income – excluding MSR – of $39.6 million, or $0.43 per diluted share, for the third quarter of 2017 compared to $36.7 million, or $0.39 per diluted share, for the third quarter of 2016 and $38.8 million, or $0.42 per diluted share, for the second quarter of 2017. Net operating income – excluding MSR – is a non-GAAP financial measure used by management to assess the core operating performance of the Company. This measure excludes items such as securities gains and losses, mortgage servicing rights (“MSR”) valuation adjustments, restructuring charges, merger-related expenses, industry-related legal settlements, and other one-time charges.

“First and foremost, we are pleased to have recently received positive results regarding our CRA examination,” remarked Dan Rollins, Chairman and Chief Executive Officer. “We have consistently communicated our teammates’ commitment to the communities we serve as well as our priority to meet or exceed all regulatory requirements and expectations. We are excited to have this examination behind us as we look to continue to execute our strategic plan.”

“Further, our third quarter results reflect yet another quarter of continued steady improvement in our profitability and performance metrics. Our net interest margin increased to 3.58 percent for the quarter, which is the result of continued loan yield pickup from recent rate increases combined with our stable core deposit base. Total operating expenses declined for the quarter, which resulted in a decline in the operating efficiency ratio – excluding MSR – to 67.2 percent. These successes contributed to improvement in our quarterly return on assets to 1.07 percent. Finally, we continue to diligently manage our capital levels, as we repurchased approximately 0.7 million shares during the quarter at a weighted average price of $28.99 per share.”

Net Interest Revenue

Net interest revenue was $120.6 million for the third quarter of 2017, an increase of 5.2 percent from $114.6 million for the third quarter of 2016 and an increase of 2.6 percent from $117.5 million for the second quarter of 2017. The fully taxable equivalent net interest margin was 3.58 percent for the third quarter of 2017 compared to 3.51 percent for the third quarter of 2016 and 3.52 percent for the second quarter of 2017. Yields on loans and leases were 4.33 percent for the third quarter of 2017 compared with 4.20 percent for the third quarter of 2016 and 4.27 percent for the second quarter of 2017, while yields on total interest earning assets were 3.89 percent for the third quarter of 2017 compared with 3.74 percent for the third quarter of 2016 and 3.80 percent for the second quarter of 2017. The average cost of deposits was 0.26 percent for the third quarter of 2017 compared to 0.22 percent for the third quarter of 2016 and 0.25 percent for the second quarter of 2017.

 

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BXS Announces Third Quarter 2017 Financial Results

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Asset, Deposit and Loan Activity

Total assets were $14.8 billion at September 30, 2017 compared with $14.6 billion at September 30, 2016. Loans and leases, net of unearned income, were $11.1 billion at September 30, 2017 compared with $10.7 billion at September 30, 2016.

Total deposits were $11.8 billion at September 30, 2017 compared with $11.6 billion at September 30, 2016. Time deposits decreased $72.4 million, or 3.9 percent, at September 30, 2017 compared to September 30, 2016. Over the same time period, interest bearing demand deposits increased $47.6 million, or 1.0 percent, while noninterest bearing demand deposits increased $106.0 million, or 3.2 percent, and savings deposits increased $104.6 million, or 6.8 percent.

Provision for Credit Losses and Allowance for Credit Losses

Earnings for the third quarter reflect a provision for credit losses of $0.5 million, compared to no provision for the third quarter of 2016 and a provision of $1.0 million for the second quarter of 2017. Net charge-offs for the third quarter of 2017 were $2.6 million, compared with net charge-offs of $1.0 million for the third quarter of 2016 and net charge-offs of $4.6 million for the second quarter of 2017. The allowance for credit losses was $119.5 million, or 1.08 percent of net loans and leases, at September 30, 2017, compared with $125.9 million, or 1.18 percent of net loans and leases, at September 30, 2016 and $121.6 million, or 1.10 percent of net loans and leases, at June 30, 2017.

Total non-performing assets were $71.0 million, or 0.64 percent of net loans and leases, at September 30, 2017 compared with $102.3 million, or 0.96 percent of net loans and leases, at September 30, 2016, and $79.4 million, or 0.72 percent of net loans and leases, at June 30, 2017. Other real estate owned was $6.0 million at September 30, 2017 compared with $11.4 million at September 30, 2016 and $7.7 million at June 30, 2017.

Noninterest Revenue

Noninterest revenue was $66.0 million for the third quarter of 2017, compared with $69.7 million for the third quarter of 2016 and $68.1 million for the second quarter of 2017. These results included the MSR valuation adjustment, which was essentially flat for the third quarter of 2017, compared with a positive MSR valuation adjustment of $1.8 million for the third quarter of 2016 and a negative MSR valuation adjustment of $1.5 million for the second quarter of 2017. 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 $7.0 million for the third quarter of 2017, compared with $9.3 million for the third quarter of 2016 and $7.6 million for the second quarter of 2017. Mortgage origination volume for the third quarter of 2017 was $342.4 million, compared with $478.2 million for the third quarter of 2016 and $385.9 million for the second quarter of 2017.

 

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BXS Announces Third Quarter 2017 Financial Results

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Credit and debit card fee revenue was $9.3 million for the third quarter of 2017, compared with $9.3 million for the third quarter of 2016 and $9.6 million for the second quarter of 2017. Deposit service charge revenue was $10.4 million for the third quarter of 2017, compared with $11.3 million for the third quarter of 2016 and $9.7 million for the second quarter of 2017. Insurance commission revenue was $28.6 million for the third quarter of 2017, compared with $28.2 million for the third quarter of 2016 and $31.1 million for the second quarter of 2017. Wealth management revenue was $5.4 million for the third quarter of 2017, compared with $5.3 million for both the third quarter of 2016 and the second quarter of 2017.

Noninterest Expense

Noninterest expense for the third quarter of 2017 was $126.9 million, compared with $128.3 million for the third quarter of 2016 and $127.6 million for the second quarter of 2017. Salaries and employee benefits expense was $81.4 million for the third quarter of 2017 compared to $80.9 million for the third quarter of 2016 and $81.6 million for the second quarter of 2017. Occupancy expense was $10.3 million for the third quarter of 2017, compared with $10.4 million for the third quarter of 2016 and $10.5 million for the second quarter of 2017. Other noninterest expense was $29.3 million for the third quarter of 2017, compared to $30.4 million for the third quarter of 2016 and $29.8 million for the second quarter of 2017.

Capital Management

The Company’s equity capitalization is comprised entirely of common stock. BancorpSouth’s ratio of shareholders’ equity to assets was 11.52 percent at September 30, 2017, compared with 11.80 percent at September 30, 2016 and 11.40 percent at June 30, 2017. The ratio of tangible shareholders’ equity to tangible assets was 9.56 percent at September 30, 2017, compared with 9.86 percent at September 30, 2016 and 9.44 percent at June 30, 2017.

During the third quarter of 2017, the Company repurchased 699,888 shares of its outstanding common stock at a weighted average price of $28.99 per share pursuant to its share repurchase program which is intended to comply with Rules 10b-18 and 10b5-1 promulgated under the Securities and Exchange Act of 1934, as amended. During the second quarter of 2017, the Company repurchased 1,381,634 shares at a weighted average price of $29.64 per share. As of September 30, 2017, the Company had 2,316,727 remaining shares available for repurchase under its current share repurchase authorization, which expires on December 29, 2017.

Estimated regulatory capital ratios at September 30, 2017 were calculated in accordance with the Basel III capital framework. BancorpSouth is a “well capitalized” bank holding company, as defined by federal regulations, at September 30, 2017, with Tier 1 risk-based capital of 12.04 and total risk-based capital of 13.03 percent, compared with required minimum levels of 8 percent and 10 percent, respectively, in order to qualify for “well capitalized” classification.

 

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BXS Announces Third Quarter 2017 Financial Results

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TRANSACTIONS

The Reorganization

On July 26, 2017, the Company, as part of a plan to effect a corporate entity restructuring, entered into an Agreement and Plan of Reorganization with the Bank. Thereafter, on August 15, 2017, the Company and the Bank entered into an Amended and Restated Agreement and Plan of Reorganization (the “Amended Plan of Reorganization”) which provides that the Company will be merged with and into the Bank with the Bank continuing as the surviving entity. Upon completion of the Reorganization, the separate existence of the Company will cease, and all of the rights, privileges, powers, franchises, properties, assets, liabilities and obligations of the Company will be vested in and assumed by the Bank.

The Reorganization and the Amended Plan of Reorganization are described in more detail in the Company’s Definitive Proxy Statement on Schedule 14A that was filed with the Securities and Exchange Commission (the “SEC”) on August 29, 2017. The Board of Directors of the Company and the Bank each unanimously adopted the Amended Plan of Reorganization, and the shareholders of the Company approved the Amended Plan of Reorganization on September 27, 2017. The Company currently expects to complete the Reorganization during the fourth quarter, assuming that all of the conditions to completion of the Reorganization have been satisfied. The Company, however, can provide no assurances that the Reorganization will close in a timely manner or at all.

Waguespack & Associates Insurance, Inc.

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

Central Community Corporation

On January 21, 2014, the Company announced the signing of a definitive merger agreement (the “CCC Merger Agreement”) with Central Community Corporation (“CCC”), headquartered in Temple, Texas, pursuant to which CCC agreed to be merged with and into the Company (the “CCC Merger”). CCC 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, 2017, CCC, on a consolidated basis, reported total assets of $1.4 billion, total loans of $706.8 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 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.

 

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BXS Announces Third Quarter 2017 Financial Results

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For more information regarding the CCC Merger and the CCC Merger Agreement, please refer to the Company’s Proxy Statement/Prospectus that was filed with the SEC on March 24, 2014 and the Company’s Current Reports on Form 8-K that were filed with the SEC on July 24, 2014, July 1, 2015, October 14, 2016 and August 16, 2017. As previously reported in the Company’s Current Report on Form 8-K filed on August 16, 2017, the Company, CCC and the Bank entered into a fourth amendment to the CCC Merger Agreement that, among other things, provides for the substitution of the Bank for the Company as a party to the CCC Merger Agreement with the Bank assuming all obligations of the Company under the CCC Merger Agreement (“CCC Amendment No. 4”). CCC Amendment No. 4 will become effective simultaneously with the effectiveness of the Reorganization.

The CCC Merger was unanimously approved by the Board of Directors of the Company and CCC and was approved by CCC shareholders on April 24, 2014. The CCC Merger Agreement has been extended until December 31, 2017 to allow for additional time to obtain the necessary regulatory approvals and to satisfy all closing conditions. The Company expects the CCC Merger to close shortly after receiving all required regulatory approvals, although the Company can provide no assurance that the CCC Merger will close timely or at all.

Ouachita Bancshares Corp.

On January 8, 2014, the Company announced the signing of a definitive merger agreement (the “OIB 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 (the “OIB Merger”). 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, 2017, OIB, on a consolidated basis, reported total assets of $730.2 million, total loans of $497.7 million and total deposits of $607.0 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 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.

For more information regarding the OIB Merger and the OIB Merger Agreement, please refer to the Company’s Proxy Statement/Prospectus that was filed with the SEC on March 10, 2014 and the Company’s Current Reports on Form 8-K that were filed with the SEC on July 24, 2014, July 1, 2015, October 14, 2016 and August 16, 2017. As previously reported in the Company’s Current Report on Form 8-K filed on August 16, 2017, the Company, OIB and the Bank entered into a fourth amendment to the OIB Merger Agreement that, among other things, provides for the substitution of the Bank for the Company as a party to the OIB Merger Agreement with the Bank assuming all obligations of the Company under the OIB Merger Agreement (“OIB Amendment No. 4”). OIB Amendment No. 4 will become effective simultaneously with the effectiveness of the Reorganization.

 

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BXS Announces Third Quarter 2017 Financial Results

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The OIB Merger was unanimously approved by the Board of Directors of the Company and OIB and was approved by OIB shareholders on April 8, 2014. The OIB Merger Agreement has been extended until December 31, 2017 to allow for additional time to obtain the necessary regulatory approvals and to satisfy all closing conditions. The Company expects the OIB Merger to close shortly after receiving all required regulatory approvals, although the Company can provide no assurance that the OIB Merger will close timely or at all.

Summary

Rollins concluded, “While our story seems repetitive quarter after quarter, we are extremely proud of the progress we are making as a company. We continue to take actions to simplify our business model and improve efficiency, as evidenced by the proposed elimination of our holding company structure. This transaction has been approved by our shareholders and is currently pending regulatory approval. As we look forward, our business development teams are focused on calling on customers and growing our company. I’m confident their efforts, combined with our focus on efficiency, will allow us to continue to deliver improved performance to our shareholders.”

Non-GAAP Measures and Ratios

This news release presents certain financial measures and ratios that are not calculated in accordance with U.S. generally accepted accounting principles (“GAAP”). A discussion regarding these non-GAAP measures and ratios, including reconciliations of non-GAAP measures to the most directly comparable GAAP measures and definitions for non-GAAP ratios, appears under the caption “Reconciliation of Non-GAAP Measures and Other Non-GAAP Ratio Definitions” beginning on page 19 of this news release.

Conference Call and Webcast

BancorpSouth will conduct a conference call to discuss its third quarter 2017 results on October 19, 2017, at 10:00 a.m. (Central Time). This conference call will be an interactive session between management and analysts. Shareholders and other interested parties may listen to this live conference call via Internet webcast by accessing www.BancorpSouth.com/Webcast. The webcast will also be available in archived format at the same address.

About BancorpSouth

BancorpSouth (NYSE: BXS) is headquartered in Tupelo, Mississippi, with $14.8 billion in assets. BancorpSouth operates 234 full service branch locations as well as additional mortgage, insurance, and loan production offices in Alabama, Arkansas, Florida, Louisiana, Mississippi, Missouri, Tennessee and Texas, including an insurance location in Illinois. BancorpSouth is committed to a culture of respect, diversity, and inclusion in both its workplace and communities. To learn more, visit our Community Commitment page at www.bancorpsouth.com. Like us on Facebook; follow us on Twitter: @MyBXS; or connect with us through LinkedIn.

 

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BXS Announces Third Quarter 2017 Financial Results

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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 closing of the Reorganization, the proposed impact of the Reorganization on the Bank, the ability of the Company and the Bank to close the Reorganization in a timely manner or at all, the terms, timing and closings of the proposed mergers with Ouachita Bancshares Corp. and Central Community Corporation, the acceptance by customers of Ouachita Bancshares Corp. and Central Community Corporation of the Company’s products and services if the proposed mergers close, the Company’s ability to operate its regulatory compliance programs consistent with federal, state and local laws, including its Bank Secrecy Act (“BSA”) and anti-money laundering (“AML”) compliance program and its fair lending compliance program, the Company’s compliance with the consent order it entered into with the Consumer Financial Protection Bureau and the United States Department of Justice related to the Company’s fair lending practices (the “Consent Order”), amortization expense for intangible assets, goodwill impairments, loan 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, the impact of interest rates on loan yields, calculation of economic value of equity, impaired loan charge-offs, diversification of the Company’s revenue stream, the growth of the Company’s insurance business and commission revenue, the growth of the Company’s customer base and loan, deposit and fee revenue sources, liquidity needs and strategies, sources of funding, net interest margin, declaration and payment of dividends, the utilization of the Company’s share repurchase program, the implementation and execution of cost saving initiatives, improvement in the Company’s efficiencies, operating expense trends, future acquisitions and consideration to be used therefor, and the impact of certain claims and ongoing, pending or threatened litigation, administrative and investigatory matters.

The Company cautions readers not to place undue reliance on the forward-looking statements contained in this news release, in that actual results could differ materially from those indicated in such forward-looking statements as a result of a variety of factors. These factors may include, but are not limited to, the Company’s ability to operate its regulatory compliance programs consistent with federal, state and local laws, including its BSA/AML compliance program and its fair lending compliance program, the Company’s ability to successfully implement and comply with the Consent Order, the ability of the Company, Ouachita Bancshares Corp. and Central Community Corporation to obtain regulatory approval of and close the proposed mergers, the willingness of Ouachita Bancshares Corp. and Central Community Corporation to proceed with the proposed mergers, the potential impact upon the Company of the delay in the closings of these proposed mergers, the ability of the Company and the Bank to complete the Reorganization, the ability of the Company and the Bank to satisfy the conditions to the completion of the Reorganization, including the receipt of regulatory approvals required for the Reorganization, the ability of the Company and the Bank to meet expectations regarding the timing, completion and accounting and tax treatments of the Reorganization, the possibility that any of the anticipated benefits of the Reorganization will not be realized or will not be realized as expected, the failure of the Reorganization to close for any other reason, the possibility that the Reorganization may be more expensive to complete than anticipated, including as a result of unexpected factors or events, the lack of availability of the Bank’s filings mandated by the Exchange Act from the SEC’s publicly available website after the closing of the Reorganization, the impact of any ongoing, pending or threatened litigation, administrative and investigatory matters involving the Company, conditions in the financial markets and economic conditions generally, the adequacy of the Company’s provision and allowance for credit losses to cover actual credit losses, the credit risk associated with real estate construction, acquisition and development loans, limitations on the Company’s ability to declare and pay dividends, the availability of capital on favorable terms if and when needed, liquidity risk, governmental regulation, including the Dodd-Frank Act, and supervision of the Company’s operations, the short-term and long-term impact of changes to banking capital standards on the Company’s regulatory capital and liquidity, the impact of regulations on service charges on the Company’s core deposit accounts, the susceptibility of the Company’s business to local economic and environmental conditions, the soundness of other financial institutions, changes in interest rates, the impact of monetary policies and economic factors on the Company’s ability to attract deposits or make loans, volatility in capital and credit markets, reputational risk, the impact of the loss of any key Company personnel, the impact of hurricanes or other adverse weather events, any requirement that the Company write down goodwill or other intangible assets, diversification in the types of financial services the Company offers, the growth of the Company’s insurance business and commission revenue, the growth of the Company’s loan, deposit and fee revenue sources, the Company’s ability to adapt its products and services to evolving industry standards and consumer preferences, competition with other financial services companies, risks in connection with completed or potential acquisitions, the Company’s growth strategy, interruptions or breaches in the Company’s information system security, the failure of certain third-party vendors to perform, unfavorable ratings by rating agencies, dilution caused by the Company’s issuance of any additional shares of its common stock to raise capital or acquire other banks, bank holding companies, financial holding companies and insurance agencies, the utilization of the Company’s share repurchase program, the implementation and execution of cost saving initiatives, other factors generally understood to affect the assets, business, cash flows, financial condition, liquidity, prospects and/or results of operations of financial services companies and other factors detailed from time to time in the Company’s press and news releases, reports and other filings with the SEC. Forward-looking statements speak only as of the date that they were made, and, except as required by law, the Company does not undertake any obligation to update or revise forward-looking statements to reflect events or circumstances that occur after the date of this news release.

 

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BXS Announces Third Quarter 2017 Financial Results

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BancorpSouth, Inc.

Selected Financial Information

(Dollars in thousands, except per share data)

(Unaudited)

 

    Quarter Ended     Quarter Ended     Quarter Ended     Quarter Ended     Quarter Ended     Year to Date     Year to Date  
    9/30/2017     6/30/2017     3/31/2017     12/31/2016     9/30/2016     9/30/2017     9/30/2016  

Earnings Summary:

             

Interest revenue

  $ 130,934     $ 126,855     $ 122,926     $ 123,444     $ 122,340     $ 380,715     $ 359,735  

Interest expense

    10,373       9,377       8,315       8,057       7,750       28,065       21,670  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net interest revenue

    120,561       117,478       114,611       115,387       114,590       352,650       338,065  

Provision for credit losses

    500       1,000       1,000       1,000       —         2,500       3,000  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net interest revenue, after provision for credit losses

    120,061       116,478       113,611       114,387       114,590       350,150       335,065  

Noninterest revenue

    65,960       68,130       70,869       71,975       69,673       204,959       202,926  

Noninterest expense

    126,903       127,553       127,109       130,519       128,317       381,565       397,390  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Income before income taxes

    59,118       57,055       57,371       55,843       55,946       173,544       140,601  

Income tax expense

    19,590       19,166       19,278       18,173       18,129       58,034       45,543  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net income

  $ 39,528     $ 37,889     $ 38,093     $ 37,670     $ 37,817     $ 115,510     $ 95,058  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Balance Sheet—Period End Balances

             

Total assets

  $ 14,760,394     $ 14,843,130     $ 14,866,054     $ 14,724,388     $ 14,611,483     $ 14,760,394     $ 14,611,483  

Total earning assets

    13,606,145       13,674,436       13,757,920       13,549,407       13,483,345       13,606,145       13,483,345  

Total securities

    2,359,967       2,421,295       2,540,887       2,531,676       2,468,199       2,359,967       2,468,199  

Loans and leases, net of unearned income

    11,055,509       11,018,540       10,801,694       10,811,991       10,658,761       11,055,509       10,658,761  

Allowance for credit losses

    119,496       121,561       125,196       123,736       125,887       119,496       125,887  

Total deposits

    11,775,988       11,938,296       12,042,845       11,688,141       11,590,059       11,775,988       11,590,059  

Long-term debt

    30,000       230,000       530,000       530,000       563,495       30,000       563,495  

Total shareholders’ equity

    1,700,502       1,691,832       1,702,389       1,723,883       1,724,104       1,700,502       1,724,104  

Balance Sheet—Average Balances

             

Total assets

  $ 14,710,245     $ 14,741,811     $ 14,832,260     $ 14,655,360     $ 14,366,759     $ 14,760,991     $ 14,083,108  

Total earning assets

    13,591,124       13,636,415       13,715,612       13,525,284       13,265,266       13,647,261       13,020,338  

Total securities

    2,367,633       2,497,108       2,507,701       2,479,008       2,186,889       2,456,967       2,098,220  

Loans and leases, net of unearned income

    11,013,270       10,883,102       10,820,486       10,737,802       10,601,481       10,906,326       10,496,431  

Total deposits

    11,802,682       11,902,415       11,941,851       11,700,213       11,509,764       11,881,806       11,459,739  

Long-term debt

    162,609       398,132       530,000       534,141       430,886       362,234       240,056  

Total shareholders’ equity

    1,695,899       1,680,053       1,731,931       1,724,871       1,719,503       1,702,496       1,693,055  

Nonperforming Assets:

             

Non-accrual loans and leases

  $ 55,796     $ 63,585     $ 74,439     $ 71,812     $ 70,725     $ 55,796     $ 70,725  

Loans and leases 90+ days past due, still accruing

    1,855       1,793       3,063       3,983       2,255       1,855       2,255  

Restructured loans and leases, still accruing

    7,366       6,303       4,060       26,047       17,936       7,366       17,936  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Non-performing loans (NPLs)

    65,017       71,681       81,562       101,842       90,916       65,017       90,916  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Other real estate owned

    5,956       7,704       8,458       7,810       11,391       5,956       11,391  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Non-performing assets (NPAs)

  $ 70,973     $ 79,385     $ 90,020     $ 109,652     $ 102,307     $ 70,973     $ 102,307  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Financial Ratios and Other Data:

             

Return on average assets

    1.07     1.03     1.04     1.02     1.05     1.05     0.90

Operating return on average assets-excluding MSR*

    1.07     1.06     1.01     0.83     1.02     1.04     1.05

Return on average shareholders’ equity

    9.25     9.05     8.92     8.69     8.75     9.07     7.50

Operating return on average shareholders’ equity-excluding MSR*

    9.25     9.27     8.63     7.08     8.49     9.05     8.74

Return on tangible equity*

    11.36     11.08     11.19     10.70     10.68     11.18     9.01

Operating return on tangible equity-excluding MSR*

    11.36     11.35     10.82     8.71     10.36     11.16     10.50

Noninterest income to average assets

    1.78     1.85     1.94     1.95     1.93     1.86     1.92

Noninterest expense to average assets

    3.42     3.47     3.48     3.54     3.55     3.46     3.77

Net interest margin-fully taxable equivalent

    3.58     3.52     3.46     3.46     3.51     3.52     3.55

Net interest rate spread

    3.45     3.40     3.35     3.36     3.41     3.40     3.45

Efficiency ratio (tax equivalent)*

    67.23     67.90     67.71     68.79     68.72     67.61     72.45

Operating efficiency ratio-excluding MSR (tax equivalent)*

    67.24     67.33     68.43     73.14     69.39     67.66     68.67

Loan/deposit ratio

    93.88     92.30     89.69     92.50     91.96     93.88     91.96

Price to earnings multiple (avg)

    19.42       18.83       19.15       22.02       18.86       19.42       18.86  

Market value to book value

    170.25     164.07     164.09     168.76     126.59     170.25     126.59

Market value to book value (avg)

    158.92     161.24     166.39     145.61     129.73     160.35     122.22

Market value to tangible book value

    209.66     202.52     202.32     207.63     154.87     209.66     154.87

Market value to tangible book value (avg)

    195.70     199.07     205.16     179.14     158.71     197.47     149.53

Headcount FTE

    3,950       3,989       3,973       3,998       3,981       3,950       3,981  

 

* Denotes non-GAAP financial measure. Refer to related disclosure and reconciliation on pages 20 and 21.

 

- MORE -


BXS Announces Third Quarter 2017 Financial Results

Page 10

October 18, 2017

 

BancorpSouth, Inc.

Selected Financial Information

(Dollars in thousands, except per share data)

(Unaudited)

 

    Quarter Ended     Quarter Ended     Quarter Ended     Quarter Ended     Quarter Ended     Year to Date     Year to Date  
    9/30/2017     6/30/2017     3/31/2017     12/31/2016     9/30/2016     9/30/2017     9/30/2016  

Credit Quality Ratios:

             

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

    0.09     0.17     (0.02 %)      0.12     0.04     0.08     0.05

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

    0.02     0.04     0.04     0.04     0.00     0.03     0.04

Allowance for credit losses to net loans and leases

    1.08     1.10     1.16     1.14     1.18     1.08     1.18

Allowance for credit losses to non-performing loans and leases

    183.79     169.59     153.50     121.50     138.47     183.79     138.47

Allowance for credit losses to non-performing assets

    168.37     153.13     139.08     112.84     123.05     168.37     123.05

Non-performing loans and leases to net loans and leases

    0.59     0.65     0.76     0.94     0.85     0.59     0.85

Non-performing assets to net loans and leases

    0.64     0.72     0.83     1.01     0.96     0.64     0.96

Equity Ratios:

             

Total shareholders’ equity to total assets

    11.52     11.40     11.45     11.71     11.80     11.52     11.80

Tangible shareholders’ equity to tangible assets*

    9.56     9.44     9.49     9.73     9.86     9.56     9.86

Capital Adequacy:

             

Common Equity Tier 1 capital

    12.04     11.90     12.16     12.23     12.13     12.04     12.13

Tier 1 capital

    12.04     11.90     12.16     12.34     12.32     12.04     12.32

Total capital

    13.03     12.91     13.21     13.38     13.37     13.03     13.37

Tier 1 leverage capital

    10.02     9.93     9.95     10.32     10.53     10.02     10.53

Estimated for current quarter

             

Common Share Data:

             

Basic earnings per share

  $ 0.43     $ 0.41     $ 0.41     $ 0.40     $ 0.40     $ 1.26     $ 1.01  

Diluted earnings per share

    0.43       0.41       0.41       0.40       0.40       1.25       1.00  

Operating earnings per share*

    0.43       0.41       0.40       0.40       0.40       1.25       1.10  

Operating earnings per share- excluding MSR*

    0.43       0.42       0.39       0.33       0.39       1.25       1.57  

Cash dividends per share

    0.14       0.13       0.13       0.13       0.13       0.39       0.33  

Book value per share

    18.83       18.59       18.44       18.40       18.33       18.83       18.33  

Tangible book value per share*

    15.29       15.06       14.95       14.95       14.98       15.29       14.98  

Market value per share (last)

    32.05       30.50       30.25       31.05       23.20       32.05       23.30  

Market value per share (high)

    32.70       31.85       32.40       31.75       25.09       32.70       25.09  

Market value per share (low)

    27.20       28.20       28.10       22.23       20.98       27.20       18.69  

Market value per share (avg)

    29.92       29.98       30.68       26.79       23.78       30.19       22.40  

Dividend payout ratio

    32.20     30.48     30.73     31.11     31.17     31.05     32.27

Total shares outstanding

    90,329,896       91,022,729       92,344,409       93,696,687       94,074,740       90,329,896       94,074,740  

Average shares outstanding—basic

    90,911,702       91,366,309       93,642,848       93,740,626       94,303,916       91,973,620       94,378,050  

Average shares outstanding—diluted

    91,099,770       91,530,552       93,829,400       93,966,392       94,563,833       92,157,392       94,617,389  

Yield/Rate:

             

(Taxable equivalent basis)

             

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

    4.33     4.27     4.20     4.18     4.20     4.27     4.20

Available-for-sale securities:

             

Taxable

    1.41     1.37     1.35     1.31     1.33     1.38     1.37

Tax-exempt

    5.25     5.26     5.29     5.29     5.32     5.26     5.35

Short-term investments

    1.02     0.88     0.76     0.41     0.52     0.84     0.42

Total interest earning assets and revenue

    3.89     3.80     3.70     3.70     3.74     3.80     3.77

Deposits

    0.26     0.25     0.23     0.23     0.22     0.25     0.22

Demand—interest bearing

    0.28     0.25     0.22     0.20     0.19     0.25     0.18

Savings

    0.12     0.12     0.12     0.12     0.12     0.12     0.12

Other time

    0.84     0.81     0.79     0.79     0.78     0.81     0.75

Short-term borrowings

    0.85     0.69     0.31     0.16     0.15     0.68     0.15

Total interest bearing deposits & short-term borrowings

    0.41     0.37     0.32     0.31     0.30     0.37     0.29

Junior subordinated debt

    N/A       N/A       3.29     3.53     3.27     3.29     3.23

Long-term debt

    1.79     1.01     0.87     0.73     0.83     1.06     1.16

Total interest bearing liabilities and expense

    0.44     0.40     0.35     0.34     0.34     0.39     0.32

Interest bearing liabilities to interest earning assets

    69.55     69.68     70.24     69.43     69.33     69.82     69.52

Net interest tax equivalent adjustment

  $ 2,237     $ 2,248     $ 2,261     $ 2,371     $ 2,462     $ 6,742     $ 7,516  

 

* Denotes non-GAAP financial measure. Refer to related disclosure and reconciliation on pages 20 and 21.

 

- MORE -


BXS Announces Third Quarter 2017 Financial Results

Page 11

October 18, 2017

 

BancorpSouth, Inc.

Consolidated Balance Sheets

(Unaudited)

 

     Sep-17     Jun-17     Mar-17     Dec-16     Sep-16  
     (Dollars in thousands)  

Assets

          

Cash and due from banks

   $ 167,871     $ 178,376     $ 147,684     $ 184,152     $ 172,782  

Interest bearing deposits with other banks

     52,316       49,680       253,738       38,813       151,944  

Available-for-sale securities, at fair value

     2,359,967       2,421,295       2,540,887       2,531,676       2,468,199  

Loans and leases

     11,073,306       11,037,808       10,822,568       10,835,512       10,685,166  

Less: Unearned income

     17,797       19,268       20,874       23,521       26,405  

Allowance for credit losses

     119,496       121,561       125,196       123,736       125,887  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net loans and leases

     10,936,013       10,896,979       10,676,498       10,688,255       10,532,874  

Loans held for sale

     138,353       184,921       161,600       166,927       204,441  

Premises and equipment, net

     311,530       306,863       305,250       305,561       305,245  

Accrued interest receivable

     44,454       40,716       42,329       42,005       41,583  

Goodwill

     300,798       300,798       300,798       300,798       294,901  

Other identifiable intangibles

     18,860       19,854       20,865       21,894       19,908  

Bank owned life insurance

     259,361       260,228       258,518       258,648       257,015  

Other real estate owned

     5,956       7,704       8,458       7,810       11,391  

Other assets

     164,915       175,716       149,429       177,849       151,200  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total Assets

   $ 14,760,394     $ 14,843,130     $ 14,866,054     $ 14,724,388     $ 14,611,483  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Liabilities

          

Deposits:

          

Demand: Noninterest bearing

   $ 3,414,397     $ 3,390,428     $ 3,401,348     $ 3,250,537     $ 3,308,361  

Interest bearing

     4,925,127       5,095,570       5,182,011       5,034,470       4,877,482  

Savings

     1,638,033       1,630,123       1,627,621       1,561,819       1,533,401  

Other time

     1,798,431       1,822,175       1,831,865       1,841,315       1,870,815  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total deposits

     11,775,988       11,938,296       12,042,845       11,688,141       11,590,059  

Securities sold under agreement to repurchase

     421,044       399,815       375,832       454,002       468,969  

Federal funds purchased and other short-term borrowing

     625,000       365,000       —         92,000       —    

Accrued interest payable

     4,826       4,259       4,109       3,975       4,107  

Junior subordinated debt securities

     —         —         —         12,888       23,198  

Long-term debt

     30,000       230,000       530,000       530,000       563,495  

Other liabilities

     203,034       213,928       210,879       219,499       237,551  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total Liabilities

     13,059,892       13,151,298       13,163,665       13,000,505       12,887,379  

Shareholders’ Equity

          

Common stock

     225,825       227,557       230,861       234,242       235,187  

Capital surplus

     175,837       191,940       226,204       271,292       278,973  

Accumulated other comprehensive loss

     (50,203     (49,861     (50,360     (50,937     (33,549

Retained earnings

     1,349,043       1,322,196       1,295,684       1,269,286       1,243,493  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total Shareholders’ Equity

     1,700,502       1,691,832       1,702,389       1,723,883       1,724,104  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total Liabilities & Shareholders’ Equity

   $ 14,760,394     $ 14,843,130     $ 14,866,054     $ 14,724,388     $ 14,611,483  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

- MORE -


BXS Announces Third Quarter 2017 Financial Results

Page 12

October 18, 2017

 

BancorpSouth, Inc.

Consolidated Average Balance Sheets

(Unaudited)

 

     Sep-17     Jun-17     Mar-17     Dec-16     Sep-16  
     (Dollars in thousands)  

Assets

          

Cash and due from banks

   $ 153,797     $ 156,387     $ 162,696     $ 171,791     $ 157,233  

Interest bearing deposits with other banks

     83,109       117,414       258,502       165,805       311,545  

Available-for-sale securities, at fair value

     2,367,633       2,497,108       2,507,701       2,479,008       2,186,889  

Loans and leases

     11,032,159       10,903,524       10,843,069       10,763,314       10,629,522  

Less: Unearned income

     18,889       20,422       22,583       25,512       28,041  

Allowance for credit losses

     121,501       125,578       124,662       125,526       126,820  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net loans and leases

     10,891,769       10,757,524       10,695,824       10,612,276       10,474,661  

Loans held for sale

     127,112       138,792       128,923       142,669       165,351  

Premises and equipment, net

     309,592       306,483       305,637       305,994       305,707  

Accrued interest receivable

     40,100       38,702       38,774       38,648       38,125  

Goodwill

     300,798       300,798       300,798       296,888       294,901  

Other identifiable intangibles

     19,222       20,218       21,236       20,303       20,248  

Bank owned life insurance

     261,100       259,182       257,669       257,397       255,967  

Other real estate owned

     6,985       7,860       8,154       9,084       13,664  

Other assets

     149,028       141,343       146,346       155,497       142,468  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total Assets

   $ 14,710,245     $ 14,741,811     $ 14,832,260     $ 14,655,360     $ 14,366,759  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Liabilities

          

Deposits:

          

Demand: Noninterest bearing

   $ 3,369,468     $ 3,362,801     $ 3,272,876     $ 3,344,632     $ 3,221,539  

Interest bearing

     4,985,113       5,079,388       5,244,069       4,951,906       4,886,920  

Savings

     1,634,577       1,626,996       1,587,725       1,543,542       1,525,016  

Other time

     1,813,524       1,833,230       1,837,181       1,860,133       1,876,289  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total deposits

     11,802,682       11,902,415       11,941,851       11,700,213       11,509,764  

Securities sold under agreement to repurchase

     444,999       412,825       414,272       475,669       454,826  

Federal funds purchased and other short-term borrowing

     411,815       151,352       19,545       3,924       11  

Accrued interest payable

     4,507       4,028       3,867       4,031       3,950  

Junior subordinated debt securities

     —         —         1,146       21,181       23,198  

Long-term debt

     162,609       398,132       530,000       534,141       430,886  

Other liabilities

     187,734       193,006       189,648       191,330       224,621  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total Liabilities

     13,014,346       13,061,758       13,100,329       12,930,489       12,647,256  

Shareholders’ Equity

          

Common stock

     227,247       228,322       234,285       234,323       235,860  

Capital surplus

     189,545       199,115       265,685       271,900       283,437  

Accumulated other comprehensive loss

     (48,591     (49,185     (50,616     (40,454     (29,743

Retained earnings

     1,327,698       1,301,801       1,282,577       1,259,102       1,229,949  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total Shareholders’ Equity

     1,695,899       1,680,053       1,731,931       1,724,871       1,719,503  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total Liabilities & Shareholders’ Equity

   $ 14,710,245     $ 14,741,811     $ 14,832,260     $ 14,655,360     $ 14,366,759  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

- MORE -


BXS Announces Third Quarter 2017 Financial Results

Page 13

October 18, 2017

 

BancorpSouth, Inc.

Consolidated Condensed Statements of Income

(Dollars in thousands, except per share data)

(Unaudited)

 

    Quarter Ended     Year to Date  
    Sep-17     Jun-17     Mar-17     Dec-16     Sep-16     Sep-17     Sep-16  

INTEREST REVENUE:

             

Loans and leases

  $ 119,599     $ 115,286     $ 111,498     $ 112,189     $ 111,605     $ 346,383     $ 328,488  

Deposits with other banks

    214       256       485       169       409       955       901  

Available-for-sale securities:

             

Taxable

    7,378       7,509       7,350       7,105       6,189       22,237       18,086  

Tax-exempt

    2,514       2,562       2,581       2,771       2,898       7,657       8,854  

Loans held for sale

    1,229       1,242       1,012       1,210       1,239       3,483       3,406  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total interest revenue

    130,934       126,855       122,926       123,444       122,340       380,715       359,735  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

INTEREST EXPENSE:

             

Interest bearing demand

    3,482       3,204       2,786       2,514       2,361       9,472       6,732  

Savings

    494       483       472       470       462       1,449       1,356  

Other time

    3,819       3,725       3,582       3,711       3,661       11,126       10,451  

Federal funds purchased and securities sold under agreement to repurchase

    754       509       322       190       173       1,585       472  

Short-term and long-term debt

    1,824       1,456       1,142       985       902       4,422       2,097  

Junior subordinated debt

    —         —         9       187       190       9       560  

Other

    —         —         2       —         1       2       2  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total interest expense

    10,373       9,377       8,315       8,057       7,750       28,065       21,670  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net interest revenue

    120,561       117,478       114,611       115,387       114,590       352,650       338,065  

Provision for credit losses

    500       1,000       1,000       1,000       —         2,500       3,000  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net interest revenue, after provision for credit losses

    120,061       116,478       113,611       114,387       114,590       350,150       335,065  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

NONINTEREST REVENUE:

             

Mortgage banking

    6,909       6,134       8,990       16,803       11,087       22,033       20,803  

Credit card, debit card and merchant fees

    9,346       9,565       8,903       9,262       9,292       27,814       27,748  

Deposit service charges

    10,388       9,706       9,689       9,956       11,313       29,783       33,345  

Security gains, net

    5       23       1,071       39       1       1,099       89  

Insurance commissions

    28,616       31,126       32,940       25,709       28,194       92,682       90,246  

Wealth management

    5,386       5,275       5,174       5,401       5,312       15,835       15,768  

Other

    5,310       6,301       4,102       4,805       4,474       15,713       14,927  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total noninterest revenue

    65,960       68,130       70,869       71,975       69,673       204,959       202,926  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

NONINTEREST EXPENSE:

             

Salaries and employee benefits

    81,415       81,597       81,386       80,850       80,884       244,398       243,238  

Occupancy, net of rental income

    10,343       10,455       10,302       10,294       10,412       31,100       30,794  

Equipment

    3,352       3,438       3,568       3,563       3,423       10,358       10,483  

Deposit insurance assessments

    2,499       2,261       2,484       1,818       3,227       7,244       8,097  

Regulatory settlement

    —         —         —         —         —         —         10,277  

Other

    29,294       29,802       29,369       33,994       30,371       88,465       94,501  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total noninterest expense

    126,903       127,553       127,109       130,519       128,317       381,565       397,390  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Income before income taxes

    59,118       57,055       57,371       55,843       55,946       173,544       140,601  

Income tax expense

    19,590       19,166       19,278       18,173       18,129       58,034       45,543  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net income

  $ 39,528     $ 37,889     $ 38,093     $ 37,670     $ 37,817     $ 115,510     $ 95,058  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net income per share: Basic

  $ 0.43     $ 0.41     $ 0.41     $ 0.40     $ 0.40     $ 1.26     $ 1.01  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Diluted

  $ 0.43     $ 0.41     $ 0.41     $ 0.40     $ 0.40     $ 1.25     $ 1.00  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

- MORE -


BXS Announces Third Quarter 2017 Financial Results

Page 14

October 18, 2017

 

BancorpSouth, Inc.

Selected Loan Data

(Dollars in thousands)

(Unaudited)

 

    Quarter Ended  
    Sep-17     Jun-17     Mar-17     Dec-16     Sep-16  

LOAN AND LEASE PORTFOLIO:

         

Commercial and industrial

  $ 1,506,352     $ 1,566,459     $ 1,536,527     $ 1,612,295     $ 1,616,152  

Real estate

         

Consumer mortgages

    2,826,333       2,776,213       2,675,672       2,643,966       2,611,387  

Home equity

    626,961       624,868       626,488       628,846       622,566  

Agricultural

    247,211       245,646       240,534       245,377       242,171  

Commercial and industrial-owner occupied

    1,835,430       1,795,321       1,801,613       1,764,265       1,668,477  

Construction, acquisition and development

    1,175,979       1,156,901       1,136,827       1,157,248       1,121,386  

Commercial real estate

    2,336,219       2,341,633       2,271,542       2,237,719       2,240,717  

Credit cards

    104,613       104,169       103,813       109,656       107,447  

All other

    396,411       407,330       408,678       412,619       428,458  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total loans

  $ 11,055,509     $ 11,018,540     $ 10,801,694     $ 10,811,991     $ 10,658,761  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

ALLOWANCE FOR CREDIT LOSSES:

         

Balance, beginning of period

  $ 121,561     $ 125,196     $ 123,736     $ 125,887     $ 126,935  

Loans and leases charged-off:

         

Commercial and industrial

    (1,963     (3,773     (384     (2,483     (1,180

Real estate

         

Consumer mortgages

    (1,193     (522     (596     (905     (595

Home equity

    (439     (125     (459     (873     (237

Agricultural

    (54     (6     (44     —         (89

Commercial and industrial-owner occupied

    (20     (1,460     (404     (20     (261

Construction, acquisition and development

    (29     (54     (30     (10     (5

Commercial real estate

    (49     (1     (19     —         (14

Credit cards

    (745     (781     (838     (815     (696

All other

    (711     (591     (559     (580     (713
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total loans charged-off

    (5,203     (7,313     (3,333     (5,686     (3,790
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Recoveries:

         

Commercial and industrial

    481       1,034       490       1,019       263  

Real estate

         

Consumer mortgages

    642       339       625       413       327  

Home equity

    378       110       356       71       109  

Agricultural

    77       34       41       15       28  

Commercial and industrial-owner occupied

    285       481       193       201       117  

Construction, acquisition and development

    260       208       1,324       195       382  

Commercial real estate

    151       75       69       176       1,043  

Credit cards

    177       205       249       208       262  

All other

    187       192       446       237       211  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total recoveries

    2,638       2,678       3,793       2,535       2,742  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net (charge-offs) recoveries

    (2,565     (4,635     460       (3,151     (1,048

Provision charged to operating expense

    500       1,000       1,000       1,000       —    
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Balance, end of period

  $ 119,496     $ 121,561     $ 125,196     $ 123,736     $ 125,887  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Average loans for period

  $ 11,013,270     $ 10,883,102     $ 10,820,486     $ 10,737,802     $ 10,601,481  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Ratio:

         

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

    0.09     0.17     (0.02 %)      0.12     0.04
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

- MORE -


BXS Announces Third Quarter 2017 Financial Results

Page 15

October 18, 2017

 

BancorpSouth, Inc.

Selected Loan Data

(Dollars in thousands)

(Unaudited)

 

    Quarter Ended  
    Sep-17     Jun-17     Mar-17     Dec-16     Sep-16  

NON-PERFORMING ASSETS

         

NON-PERFORMING LOANS AND LEASES:

         

Nonaccrual Loans and Leases

         

Commercial and industrial

  $ 8,776     $ 9,988     $ 13,959     $ 13,679     $ 11,659  

Real estate

         

Consumer mortgages

    23,635       24,690       21,543       21,084       20,196  

Home equity

    2,555       3,183       3,157       3,817       3,721  

Agricultural

    5,919       6,172       5,180       1,546       1,194  

Commercial and industrial-owner occupied

    7,558       10,215       15,135       10,791       11,983  

Construction, acquisition and development

    1,771       2,223       1,466       7,022       6,939  

Commercial real estate

    4,645       6,418       13,638       13,402       14,793  

Credit cards

    126       122       87       161       121  

All other

    811       574       274       310       119  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total nonaccrual loans and leases

  $ 55,796     $ 63,585     $ 74,439     $ 71,812     $ 70,725  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

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

    1,855       1,793       3,063       3,983       2,255  

Restructured Loans and Leases, Still Accruing

    7,366       6,303       4,060       26,047       17,936  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total non-performing loans and leases

    65,017       71,681       81,562       101,842       90,916  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

OTHER REAL ESTATE OWNED:

    5,956       7,704       8,458       7,810       11,391  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total Non-performing Assets

  $ 70,973     $ 79,385     $ 90,020     $ 109,652     $ 102,307  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Additions to Nonaccrual Loans and Leases During the Quarter

  $ 16,975     $ 17,020     $ 23,348     $ 16,007     $ 17,319  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

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

         

Commercial and industrial

  $ 3,791     $ 3,304     $ 4,083     $ 3,449     $ 6,736  

Real estate

         

Consumer mortgages

    18,603       12,395       10,149       14,490       15,443  

Home equity

    2,042       2,590       1,720       3,072       3,854  

Agricultural

    476       197       364       1,283       616  

Commercial and industrial-owner occupied

    4,453       2,228       1,949       2,120       1,712  

Construction, acquisition and development

    4,464       2,639       3,306       1,344       1,272  

Commercial real estate

    1,206       1,183       2,631       653       15,221  

Credit cards

    720       705       800       726       774  

All other

    699       1,203       776       673       1,089  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

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

  $ 36,454     $ 26,444     $ 25,778     $ 27,810     $ 46,717  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Credit Quality Ratios:

         

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

    0.02     0.04     0.04     0.04     0.00

Allowance for credit losses to net loans and leases

    1.08     1.10     1.16     1.14     1.18

Allowance for credit losses to non-performing loans and leases

    183.79     169.59     153.50     121.50     138.47

Allowance for credit losses to non-performing assets

    168.37     153.13     139.08     112.84     123.05

Non-performing loans and leases to net loans and leases

    0.59     0.65     0.76     0.94     0.85

Non-performing assets to net loans and leases

    0.64     0.72     0.83     1.01     0.96

 

- MORE -


BXS Announces Third Quarter 2017 Financial Results

Page 16

October 18, 2017

 

BancorpSouth, Inc.

Selected Loan Data

(Dollars in thousands)

(Unaudited)

 

    September 30, 2017  
          Special                                
    Pass     Mention     Substandard     Doubtful     Loss     Impaired     Total  

LOAN PORTFOLIO BY INTERNALLY ASSIGNED GRADE:

             

Commercial and industrial

  $ 1,449,512     $ 762     $ 50,633     $ 290     $ 146     $ 5,009     $ 1,506,352  

Real estate

             

Consumer mortgages

    2,768,161       —         55,836       272       —         2,064       2,826,333  

Home equity

    617,463       —         8,731       —         —         767       626,961  

Agricultural

    234,563       —         7,372       —         —         5,276       247,211  

Commercial and industrial-owner occupied

    1,766,055       2,920       62,232       —         —         4,223       1,835,430  

Construction, acquisition and development

    1,159,359       3,718       12,902       —         —         —         1,175,979  

Commercial real estate

    2,293,845       —         39,805       177       —         2,392       2,336,219  

Credit cards

    104,613       —         —         —         —         —         104,613  

All other

    392,100       —         4,211       100       —         —         396,411  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total loans

  $ 10,785,671     $ 7,400     $ 241,722     $ 839     $ 146     $ 19,731     $ 11,055,509  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 
    June 30, 2017  
          Special                                
    Pass     Mention     Substandard     Doubtful     Loss     Impaired     Total  

LOAN PORTFOLIO BY INTERNALLY ASSIGNED GRADE:

             

Commercial and industrial

  $ 1,516,992     $ —       $ 41,604     $ 301     $ —       $ 7,562     $ 1,566,459  

Real estate

             

Consumer mortgages

    2,710,161       —         63,352       276       —         2,424       2,776,213  

Home equity

    613,216       —         10,802       —         —         850       624,868  

Agricultural

    225,504       8,157       6,740       —         —         5,245       245,646  

Commercial and industrial-owner occupied

    1,734,306       3,161       50,644       —         —         7,210       1,795,321  

Construction, acquisition and development

    1,136,104       6,253       14,298       —         —         246       1,156,901  

Commercial real estate

    2,299,529       —         37,214       169       —         4,721       2,341,633  

Credit cards

    104,169       —         —         —         —         —         104,169  

All other

    400,191       —         6,900       239       —         —         407,330  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total loans

  $ 10,740,172     $ 17,571     $ 231,554     $ 985     $  —       $ 28,258     $ 11,018,540  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

- MORE -


BXS Announces Third Quarter 2017 Financial Results

Page 17

October 18, 2017

 

BancorpSouth, Inc.

Geographical Information

(Dollars in thousands)

(Unaudited)

 

    September 30, 2017  
    Alabama                                                  
    and
Florida
                                                 
    Panhandle     Arkansas     Louisiana     Mississippi     Missouri     Tennessee     Texas     Other     Total  

LOAN AND LEASE PORTFOLIO:

                 

Commercial and industrial

  $ 136,368     $ 195,461     $ 193,882     $ 551,391     $ 70,856     $ 108,389     $ 200,118     $ 49,887     $ 1,506,352  

Real estate

                 

Consumer mortgages

    379,388       327,113       233,715       879,524       92,807       316,209       543,855       53,722       2,826,333  

Home equity

    96,418       47,361       70,916       230,493       21,531       139,521       19,348       1,373       626,961  

Agricultural

    8,298       83,830       25,290       66,829       7,205       13,019       42,722       18       247,211  

Commercial and industrial-owner occupied

    210,503       203,249       223,947       710,693       46,384       154,354       286,300       —         1,835,430  

Construction, acquisition and development

    126,581       75,400       57,445       355,559       20,391       164,014       376,589       —         1,175,979  

Commercial real estate

    300,226       357,712       236,589       574,667       209,097       212,296       445,632       —         2,336,219  

Credit cards

    —         —         —         —         —         —         —         104,613       104,613  

All other

    52,154       40,023       22,141       210,898       2,969       22,066       39,332       6,828       396,411  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total loans

  $ 1,309,936     $ 1,330,149     $ 1,063,925     $ 3,580,054     $ 471,240     $ 1,129,868     $ 1,953,896     $ 216,441     $ 11,055,509  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

NON-PERFORMING LOANS AND LEASES:

                 

Commercial and industrial

  $ 652     $ 951     $ 405     $ 4,346     $ 689     $ 105     $ 2,104     $ 635     $ 9,887  

Real estate

                 

Consumer mortgages

    1,309       4,600       1,785       11,863       262       1,805       3,644       399       25,667  

Home equity

    540       723       694       501       79       110       —         2       2,649  

Agricultural

    —         237       204       5,512       —         —         15       —         5,968  

Commercial and industrial-owner occupied

    855       2,519       1,098       3,927       1,019       1,011       694       —         11,123  

Construction, acquisition and development

    42       719       267       784       —         —         99       —         1,911  

Commercial real estate

    984       1,004       328       2,932       —         —         299       —         5,547  

Credit cards

    —         —         —         —         —         —         —         1,398       1,398  

All other

    14       —         7       645       —         196       5       —         867  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total loans

  $ 4,396     $ 10,753     $ 4,788     $ 30,510     $ 2,049     $ 3,227     $ 6,860     $ 2,434     $ 65,017  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

NON-PERFORMING LOANS AND LEASES AS A PERCENTAGE OF OUTSTANDING:

                 

Commercial and industrial

    0.48     0.49     0.21     0.79     0.97     0.10     1.05     1.27     0.66

Real estate

                 

Consumer mortgages

    0.35     1.41     0.76     1.35     0.28     0.57     0.67     0.74     0.91

Home equity

    0.56     1.53     0.98     0.22     0.37     0.08     0.00     0.15     0.42

Agricultural

    0.00     0.28     0.81     8.25     0.00     0.00     0.04     0.00     2.41

Commercial and industrial-owner occupied

    0.41     1.24     0.49     0.55     2.20     0.65     0.24     N/A       0.61

Construction, acquisition and development

    0.03     0.95     0.46     0.22     0.00     0.00     0.03     N/A       0.16

Commercial real estate

    0.33     0.28     0.14     0.51     0.00     0.00     0.07     N/A       0.24

Credit cards

    N/A       N/A       N/A       N/A       N/A       N/A       N/A       1.34     1.34

All other

    0.03     0.00     0.03     0.31     0.00     0.89     0.01     0.00     0.22
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total loans

    0.34     0.81     0.45     0.85     0.43     0.29     0.35     1.12     0.59
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

- MORE -


BXS Announces Third Quarter 2017 Financial Results

Page 18

October 18, 2017

 

BancorpSouth, Inc.

Noninterest Revenue and Expense

(Dollars in thousands)

(Unaudited)

 

    Quarter Ended     Year to Date  
    Sep-17     Jun-17     Mar-17     Dec-16     Sep-16     Sep-17     Sep-16  

NONINTEREST REVENUE:

             

Mortgage banking excl. MSR and MSR Hedge market value adj

  $ 6,955     $ 7,643     $ 8,056     $ 5,561     $ 9,274     $ 22,654     $ 31,036  

MSR and MSR Hedge market value adjustment

    (46     (1,509     934       11,242       1,813       (621     (10,233

Credit card, debit card and merchant fees

    9,346       9,565       8,903       9,262       9,292       27,814       27,748  

Deposit service charges

    10,388       9,706       9,689       9,956       11,313       29,783       33,345  

Securities gains, net

    5       23       1,071       39       1       1,099       89  

Insurance commissions

    28,616       31,126       32,940       25,709       28,194       92,682       90,246  

Trust income

    3,803       3,679       3,561       3,874       3,641       11,043       10,564  

Annuity fees

    246       264       349       257       446       859       1,388  

Brokerage commissions and fees

    1,337       1,332       1,264       1,270       1,225       3,933       3,816  

Bank-owned life insurance

    2,700       1,710       1,669       2,104       1,775       6,079       5,481  

Other miscellaneous income

    2,610       4,591       2,433       2,701       2,699       9,634       9,446  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total noninterest revenue

  $ 65,960     $ 68,130     $ 70,869     $ 71,975     $ 69,673     $ 204,959     $ 202,926  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

NONINTEREST EXPENSE:

             

Salaries and employee benefits

  $ 81,415     $ 81,597     $ 81,386     $ 80,850     $ 80,884     $ 244,398     $ 243,238  

Occupancy, net of rental income

    10,343       10,455       10,302       10,294       10,412       31,100       30,794  

Equipment

    3,352       3,438       3,568       3,563       3,423       10,358       10,483  

Deposit insurance assessments

    2,499       2,261       2,484       1,818       3,227       7,244       8,097  

Regulatory settlement

    —         —         —         —         —         —         10,277  

Advertising

    1,185       1,037       663       2,443       925       2,885       2,601  

Foreclosed property expense

    447       960       1,050       1,005       859       2,457       3,349  

Telecommunications

    1,192       1,233       1,147       1,245       1,288       3,572       3,842  

Public relations

    675       654       720       716       718       2,049       1,978  

Data processing

    6,942       7,230       6,623       6,903       6,856       20,795       19,932  

Computer software

    3,074       2,913       2,981       3,013       2,976       8,968       8,368  

Amortization of intangibles

    994       1,010       1,030       963       923       3,034       2,672  

Legal

    1,016       1,330       1,229       1,190       1,064       3,575       7,353  

Merger expense

    —         —         —         —         —         —         2  

Postage and shipping

    1,050       1,080       1,175       1,075       1,059       3,305       3,161  

Other miscellaneous expense

    12,719       12,355       12,751       15,441       13,703       37,825       41,243  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total noninterest expense

  $ 126,903     $ 127,553     $ 127,109     $ 130,519     $ 128,317     $ 381,565     $ 397,390  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

INSURANCE COMMISSIONS:

             

Property and casualty commissions

  $ 21,086     $ 22,363     $ 19,755     $ 19,098     $ 20,927       63,204     $ 61,221  

Life and health commissions

    6,134       6,623       6,465       5,757       5,897       19,222       17,764  

Risk management income

    703       600       648       610       674       1,951       1,889  

Other

    693       1,540       6,072       244       696       8,305       9,372  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total insurance commissions

  $ 28,616     $ 31,126     $ 32,940     $ 25,709     $ 28,194     $ 92,682     $ 90,246  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

- MORE -


BXS Announces Third Quarter 2017 Financial Results

Page 19

October 18, 2017

 

BancorpSouth, Inc.

Selected Additional Information

(Dollars in thousands)

(Unaudited)

 

    Quarter Ended  
    Sep-17     Jun-17     Mar-17     Dec-16     Sep-16  

MORTGAGE SERVICING RIGHTS:

         

Fair value, beginning of period

  $ 65,491     $ 67,161     $ 65,263     $ 51,930     $ 48,108  

Additions to mortgage servicing rights:

         

Originations of servicing assets

    3,393       2,772       2,866       4,022       4,349  

Changes in fair value:

         

Due to payoffs/paydowns

    (2,502     (2,825     (1,876     (2,447     (2,338

Due to change in valuation inputs or assumptions used in the valuation model

    36       (1,616     909       11,759       1,813  

Other changes in fair value

    (1     (1     (1     (1     (2
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Fair value, end of period

  $ 66,417     $ 65,491     $ 67,161     $ 65,263     $ 51,930  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

MORTGAGE BANKING REVENUE:

         

Production revenue:

         

Origination

  $ 4,809     $ 5,771     $ 5,117     $ 3,335     $ 6,973  

Servicing

    4,648       4,697       4,815       4,673       4,639  

Payoffs/Paydowns

    (2,502     (2,825     (1,876     (2,447     (2,338
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total production revenue

    6,955       7,643       8,056       5,561       9,274  

Market value adjustment on MSR

    36       (1,616     909       11,759       1,813  

Market value adjustment on MSR Hedge

    (82     107       25       (517     —    
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total mortgage lending revenue

  $ 6,909     $ 6,134     $ 8,990     $ 16,803     $ 11,087  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Mortgage loans serviced

  $ 6,506,550     $ 6,431,273     $ 6,429,617     $ 6,384,649     $ 6,285,027  

MSR/mtg loans serviced

    1.02     1.02     1.04     1.01     0.83

AVAILABLE-FOR-SALE SECURITIES, at fair value

         

U.S. Government agencies

  $ 1,687,186     $ 1,713,374     $ 1,818,180     $ 1,789,427     $ 1,691,866  

Government agency issued residential mortgage-back securities

    157,891       159,246       167,542       176,243       184,095  

Government agency issued commercial mortgage-back securities

    153,509       170,642       170,082       172,279       178,826  

Obligations of states and political subdivisions

    328,314       345,130       352,324       360,005       384,996  

Other

    33,067       32,903       32,759       33,722       28,416  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total available-for-sale securities

  $ 2,359,967     $ 2,421,295     $ 2,540,887     $ 2,531,676     $ 2,468,199  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

- MORE -


BXS Announces Third Quarter 2017 Financial Results

Page 20

October 18, 2017

 

BancorpSouth, Inc.

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

(Dollars in thousands, except per share amounts)

(Unaudited)

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

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

 

    Quarter ended     Year to Date  
    9/30/2017     6/30/2017     3/31/2017     12/31/2016     9/30/2016     9/30/2017     9/30/2016  

Net income

  $ 39,528     $ 37,889     $ 38,093     $ 37,670     $ 37,817     $ 115,510     $ 95,058  

Plus: Merger expense, net of tax

    —         —         —         —         —         —         2  

Regulatory related charges, net of tax

    —         —         —         —         —         —         9,412  

Less: Security gains, net of tax

    3       14       664       25       —         681       55  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net operating income

  $ 39,525     $ 37,875     $ 37,429     $ 37,645     $ 37,817     $ 114,829     $ 104,417  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Less: MSR market value adjustment, net of tax

    (28     (936     579       6,970       1,124       (385     (6,344
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net operating income-excluding MSR

  $ 39,553     $ 38,811     $ 36,850     $ 30,675     $ 36,693     $ 115,214     $ 110,761  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Reconciliation of Total Operating Expense to Total Noninterest Expense:

 

 

         

Total noninterest expense

  $ 126,903     $ 127,553     $ 127,109     $ 130,519     $ 128,317     $ 381,565     $ 397,390  

Less: Merger expense

    —         —         —         —         —         —         2  

Regulatory related charges

    —         —         —         —         —         —         13,777  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total operating expense

  $ 126,903     $ 127,553     $ 127,109     $ 130,519     $ 128,317     $ 381,565     $ 383,611  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

- MORE -


BXS Announces Third Quarter 2017 Financial Results

Page 21

October 18, 2017

 

BancorpSouth, Inc.

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

(Dollars in thousands, except per share amounts)

(Unaudited)

Reconciliation of Tangible Assets and Tangible Shareholders’ Equity to

Total Assets and Total Shareholders’ Equity:

 

    Quarter ended     Year to Date  
    9/30/2017     6/30/2017     3/31/2017     12/31/2016     9/30/2016     9/30/017     9/30/2016  

Tangible assets

             

Total assets

  $ 14,760,394     $ 14,843,130     $ 14,866,054     $ 14,724,388     $ 14,611,483     $ 14,760,394     $ 14,611,483  

Less: Goodwill

    300,798       300,798       300,798       300,798       294,901       300,798       294,901  

Other identifiable intangible assets

    18,860       19,854       20,865       21,894       19,908       18,860       19,908  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total tangible assets

  $ 14,440,736     $ 14,522,478     $ 14,544,391     $ 14,401,696     $ 14,296,674     $ 14,440,736     $ 14,296,674  

Tangible shareholders’ equity

             

Total shareholders’ equity

  $ 1,700,502     $ 1,691,832     $ 1,702,389     $ 1,723,883     $ 1,724,104     $ 1,700,502     $ 1,724,104  

Less: Goodwill

    300,798       300,798       300,798       300,798       294,901       300,798       294,901  

Other identifiable intangible assets

    18,860       19,854       20,865       21,894       19,908       18,860       19,908  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total tangible shareholders’ equity

  $ 1,380,844     $ 1,371,180     $ 1,380,726     $ 1,401,191     $ 1,409,295     $ 1,380,844     $ 1,409,295  

Total average assets

  $ 14,710,245     $ 14,741,811     $ 14,832,260     $ 14,655,360     $ 14,366,759     $ 14,760,991     $ 14,083,108  

Total shares of common stock outstanding

    90,329,896       91,022,729       92,344,409       93,696,687       94,074,740       90,329,896       94,074,740  

Average shares outstanding-diluted

    91,099,770       91,530,552       93,829,400       93,966,392       94,563,833       92,157,392       94,617,389  

Tangible shareholders’ equity to tangible assets (1)

    9.56     9.44     9.49     9.73     9.86     9.56     9.86

Return on tangible
equity (2)

    11.36     11.08     11.19     10.70     10.68     11.18     9.01

Operating return on tangible equity-excluding MSR (3)

    11.36     11.35     10.82     8.71     10.36     11.16     10.50

Operating return on average assets-excluding MSR (4)

    1.07     1.06     1.01     0.83     1.02     1.04     1.05

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

    9.25     9.27     8.63     7.08     8.49     9.05     8.74

Tangible book value per share (6)

  $ 15.29     $ 15.06     $ 14.95     $ 14.95     $ 14.98     $ 15.29     $ 14.98  

Operating earnings per share (7)

  $ 0.43     $ 0.41     $ 0.40     $ 0.40     $ 0.40     $ 1.25     $ 1.10  

Operating earnings per share-excluding
MSR (8)

  $ 0.43     $ 0.42     $ 0.39     $ 0.33     $ 0.39     $ 1.25     $ 1.17  

 

(1) Tangible shareholders’ equity to tangible assets is defined by the Company as total shareholders’ equity less goodwill and other identifiable intangible assets, divided by the difference of total assets less goodwill and other identifiable intangible assets.
(2) Return on tangible equity is defined by the Company as annualized net income divided by tangible shareholders’ equity.
(3) Operating return on tangible equity-excluding MSR is defined by the Company as annualized net operating income-excluding MSR divided by tangible shareholders’ equity.
(4) Operating return on average assets-excluding MSR is defined by the Company as annualized net operating income-excluding MSR divided by total average assets.
(5) Operating return on average shareholders’ equity-excluding MSR is defined by the Company as annualized net operating income-excluding MSR divided by average shareholders’ equity.
(6) Tangible book value per share is defined by the Company as tangible shareholders’ equity divided by total shares of common stock outstanding.
(7) Operating earnings per share is defined by the Company as net operating income divided by average shares outstanding-diluted.
(8) Operating earnings per share-excluding MSR is defined by the Company as net operating income-excluding MSR divided by average shares outstanding-diluted.

Efficiency Ratio (tax equivalent) and Operating Efficiency Ratio-excluding MSR (tax equivalent) Definitions

The efficiency ratio (tax equivalent) and the operating efficiency ratio-excluding MSR (tax equivalent) are supplemental financial measures utilized in management’s internal evaluation of the Company’s use of resources and are not defined under GAAP. The efficiency ratio (tax equivalent) is calculated by dividing total noninterest expense by total revenue, which includes net interest income plus noninterest income plus the tax equivalent adjustment. The operating efficiency ratio-excluding MSR (tax equivalent) excludes expense items otherwise disclosed as non-operating from total noninterest expense. In addition, the MSR valuation adjustment as well as securities gains and losses are excluded from total revenue.

 

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Bancorpsouth Inc provided additional information to their SEC Filing as exhibits

Ticker: BXS
CIK: 701853
Form Type: 8-K Corporate News
Accession Number: 0001193125-17-313366
Submitted to the SEC: Thu Oct 19 2017 8:11:04 AM EST
Accepted by the SEC: Thu Oct 19 2017
Period: Wednesday, October 18, 2017
Industry: State Commercial Banks
Events:
  1. Earnings Release
  2. Financial Exhibit
  3. Regulated Disclosure

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