BancorpSouth Announces Fourth Quarter 2012 Earnings of $17.0 Million or $0.18 per Diluted Share

TUPELO, Miss., Jan. 23, 2013 /PRNewswire/ -- BancorpSouth, Inc. (NYSE: BXS) today announced financial results for the quarter ended December 31, 2012.

Highlights for the fourth quarter of 2012 included:

  • The appointment of James D. Rollins III as the Company's new Chief Executive Officer.
  • Quarterly net income of $17.0 million or $0.18 per diluted share, resulting in net income of $84.3 million, or $0.90 per diluted share, for the year.
  • Mortgage production of $549.4 million, which contributed to mortgage lending revenue of $17.2 million for the quarter.
  • Other real estate owned ("OREO") sales of $27.9 million, which contributed to a 19.5 percent decline in OREO and a 10.3 percent reduction in total non-performing assets ("NPAs") from the prior quarter and reductions of 40.6 percent and 32.1 percent, respectively, compared to the end of 2011.
  • Nonaccrual loans decreased $12.5 million, or 5.7 percent, from the prior quarter and $69.6 million, or 25.1 percent, from the fourth quarter of 2011.  At the end of the quarter, 55.7 percent of nonaccrual loans were paying in accordance with their contractual terms.
  • Capital ratios continued to rise, with Tier 1 leverage and Total risk-based capital ratios increasing to 10.25 percent and 15.08 percent, respectively. 

On November 26, 2012 the Company announced that the Board of Directors had selected James D. "Dan" Rollins III as its new Chief Executive Officer.  Rollins assumed this position effective November 27, 2012, and also became a member of BancorpSouth's Board of Directors at that time.  Rollins succeeded Aubrey B. Patterson, who continues to serve as Chairman of the Board.  Rollins remarked, "I am both humbled by the confidence that the Board of Directors has placed in me and excited about working with a team of professionals who share a desire and commitment to move our Company forward.  While I was only a part of the team for the last month of 2012, I believe that the results reported for the year are the product of a lot of hard work and effort over a number of quarters to continue to improve the Company's credit quality and operating performance."

The Company reported net income of $17.0 million, or $0.18 per diluted share, for the fourth quarter of 2012 compared with net income of $13.3 million, or $0.16 per diluted share, for the fourth quarter of 2011 and net income of $23.8 million, or $0.25 per diluted share, for the third quarter of 2012.  The Company reported total net income for 2012 of $84.3 million, or $0.90 per diluted share, compared with $37.6 million, or $0.45 per diluted share, for 2011.     

"Results for the fourth quarter reflect yet another quarter of strong mortgage production and asset quality improvement," remarked Patterson.  "Mortgage production for the quarter was $549.4 million, contributing to total mortgage lending revenue of $17.2 million.  This level of production resulted in a record annual production volume of almost $2 billion for 2012.  As to asset quality, we are particularly pleased with disposition efforts related to OREO.  Total sales for the quarter exceeded $27 million, which represents the largest quarter of sales during the credit cycle.  We made decisions during the quarter to expedite the disposition of many of the OREO properties and to more aggressively price others going forward.  Some of these decisions adversely impacted current quarter earnings, but we believe they are prudent ones that will help improve profitability in future periods."

Earnings for the quarter reflect a provision for credit losses of $6.0 million, which is a decrease from $19.3 million for the fourth quarter of 2011 and is flat compared to $6.0 million for the third quarter of 2012.  Non-performing loans ("NPLs") declined $13.8 million, or 5.6 percent, during the fourth quarter of 2012 to $233.6 million compared with $247.3 million at September 30, 2012 and declined $88.7 million, or 27.5 percent, from $322.3 million at December 31, 2011.  In addition, total NPAs declined $38.7 million, or 10.3 percent, to $336.8 million compared with $375.5 million at September 30, 2012 and declined $159.3 million, or 32.1 percent, from $496.1 million at December 31, 2011.  Net charge-offs declined to $10.6 million for the fourth quarter of 2012 compared with $12.8 million for the third quarter of 2012.  Net charge-offs during the fourth quarter of 2012 included $6.4 million of charge-offs of loans which had been identified and reported as impaired and were reserved for in previous quarters. 

Earnings for the quarter were also impacted by additional compression in the net interest margin.  The fully taxable equivalent net interest margin was 3.44 percent for the fourth quarter of 2012 compared with 3.55 percent for the third quarter of 2012 and 3.69 percent for the fourth quarter of 2011.  Patterson added, "As others in the industry have experienced, we continue to see pressure on the net interest margin as a result of re-pricing on the asset side of the balance sheet.  Our securities portfolio continues to roll over at lower rates and loan yields are under pressure both prior to and at maturity.  The importance of fee income generation and efficiency are becoming increasingly magnified as we work to navigate through this rate environment."    

Net Interest Revenue

Net interest revenue was $100.9 million for the fourth quarter of 2012, a decrease of 6.2 percent from $107.5 million for the fourth quarter of 2011 and a decrease of 2.4 percent from $103.4 million for the third quarter of 2012.  The fully taxable equivalent net interest margin declined to 3.44 percent for the fourth quarter of 2012 from 3.69 percent for the fourth quarter of 2011 and 3.55 percent for the third quarter of 2012.  Declines in the net interest margin were due primarily to continued pressure on asset yields, particularly yields on loans and leases, which declined to 4.76 percent for the fourth quarter of 2012 compared with 5.02 percent for the fourth quarter of 2011 and 4.85 percent for the third quarter of 2012. 

Asset, Deposit and Loan Activity

Total assets were $13.4 billion at December 31, 2012 compared with $13.0 billion at December 31, 2011.  Total deposits were $11.1 billion at December 31, 2012, an increase of 1.2 percent from $11.0 billion at December 31, 2011.  Loans and leases, net of unearned income, were $8.6 billion at December 31, 2012, a decrease of 2.6 percent from $8.9 billion at December 31, 2011.  The construction, acquisition, and development ("CAD") loan portfolio, which decreased $172.6 million, or 19.0 percent, from December 31, 2011 to December 31, 2012, accounted for 74.0 percent of the decline in net loans and leases over the same time period.

The decrease in time deposits of $389.2 million, or 13.0 percent, at December 31, 2012 compared to December 31, 2011, was offset partially by significant growth in noninterest bearing demand deposits, which increased $275.4 million, or 12.1 percent, over the same period.  Additionally, savings deposits increased $154.1 million, or 15.5 percent, while interest bearing demand deposits increased $92.7 million, or 2.0 percent, over the same period.  As of December 31, 2012, $801.9 million of time deposits were scheduled to mature during the following two quarters at a weighted average rate of 0.73 percent.   

Provision for Credit Losses and Allowance for Credit Losses

For the fourth quarter of 2012, the provision for credit losses was $6.0 million, compared with $19.3 million for the fourth quarter of 2011 and $6.0 million for the third quarter of 2012.  Net charge-offs for the fourth quarter of 2012 were $10.6 million, compared with $23.8 million for the fourth quarter of 2011 and $12.8 million for the third quarter of 2012.  Recoveries of previously charged-off loans were $9.2 million for the fourth quarter of 2012, compared with $2.6 million for the fourth quarter of 2011 and $6.1 million for the third quarter of 2012.  Annualized net charge-offs were 0.49 percent of average loans and leases for the fourth quarter of 2012, compared with 1.06 percent for the fourth quarter of 2011 and 0.59 percent for the third quarter of 2012.  Total annual net charge-offs were $58.7 million for 2012 compared with $131.9 million for 2011.  Recoveries of previously charged-off loans totaled $30.7 million for 2012 compared with $10.2 million for 2011. 

NPLs were $233.6 million, or 2.70 percent of net loans and leases, at December 31, 2012, compared with $322.3 million, or 3.63 percent of net loans and leases, at December 31, 2011, and $247.3 million, or 2.85 percent of net loans and leases, at September 30, 2012.  The allowance for credit losses was $164.5 million, or 1.90 percent of net loans and leases, at December 31, 2012 compared with $195.1 million, or 2.20 percent of net loans and leases, at December 31, 2011 and $169.0 million, or 1.95 percent of net loans and leases, at September 30, 2012. 

NPLs at December 31, 2012 consisted primarily of $207.2 million of nonaccrual loans, compared with $219.7 million of nonaccrual loans at September 30, 2012.  Included in the reduction of nonaccrual loans during the fourth quarter of 2012 were payments received on nonaccrual loans of $31.6 million, compared with payments received on such loans of $26.7 million during the third quarter of 2012.  NPLs at December 31, 2012 also included $1.2 million of loans 90 days or more past due and still accruing, compared with $1.4 million at September 30, 2012, and included restructured loans still accruing of $25.1 million at December 31, 2012, compared with $26.1 million at September 30, 2012.  Early stage past due loans, representing loans 30-89 days past due, declined to $28.2 million at December 31, 2012 from $43.8 million at September 30, 2012.  

At December 31, 2012, $35.7 million of NPLs were residential CAD loans, $36.3 million were other CAD loans, $62.2 million were commercial real estate loans and $40.7 million were consumer mortgages.  NPLs from all other loan types totaled $58.7 million at December 31, 2012.  Included in nonaccrual loans at December 31, 2012 were $115.4 million of loans, or 55.7 percent of total nonaccrual loans, that were paying as agreed, compared with $125.0 million, or 56.9 percent, at the end of the third quarter of 2012.  These loans were generally placed on nonaccrual status because the collateral values were less than the outstanding balances, and because of uncertainty as to whether the borrowers possessed adequate liquidity or would be able to generate sufficient cash flow to satisfy the debt given the short-fall in collateral values.  Such loans are generally deemed to be impaired, with a specific reserve established for the difference in the balance owed and the disposition value of the collateral.

At the end of the fourth quarter, 75.6 percent of nonaccrual loans were determined to be collateral dependent, and after write-downs and specific reserves, the remaining book balance of these loans was 70.9 percent of the unpaid principal balance.  At December 31, 2012, coverage of unimpaired nonaccrual loans by the nonspecified allowance for credit losses was 305 percent and coverage of unimpaired NPLs by the nonspecified allowance for credit losses was 200 percent. 

OREO decreased $25.0 million to $103.2 million during the fourth quarter of 2012 from $128.2 million at September 30, 2012.  This net decrease reflected $8.5 million added through foreclosure, offset by sales of OREO of $27.9 million.  Write-downs in the value of existing properties were $5.5 million for the fourth quarter of 2012 compared to $6.3 million for the third quarter of 2012.  Sales of OREO during the fourth quarter of 2012 resulted in a net loss of $4.2 million compared to a net loss of $0.8 million for the third quarter of 2012.  At December 31, 2012, OREO was carried at 44.0 percent of the aggregate loan balances at the time of foreclosure, compared with 49.2 percent at September 30, 2012.

Noninterest Revenue

Noninterest revenue was $70.9 million for the fourth quarter of 2012, compared with $65.3 million for the fourth quarter of 2011 and $70.4 million for the third quarter of 2012.  These results included a positive mortgage servicing rights ("MSR") valuation adjustment of $0.2 million for the fourth quarter of 2012 compared with negative adjustments of $1.0 million for the fourth quarter of 2011 and $3.2 million for the third quarter of 2012. 

Excluding the MSR valuation adjustments, net mortgage lending revenue was $17.0 million for the fourth quarter of 2012, compared with $9.9 million for the fourth quarter of 2011 and $16.8 million for the third quarter of 2012.  Mortgage origination volume for the fourth quarter of 2012 was $549.4 million, compared with $389.6 million for the fourth quarter of 2011 and $607.9 million for the third quarter of 2012.

Credit and debit card fee revenue was $8.1 million for the fourth quarter of 2012, compared with $7.8 million for the fourth quarter of 2011 and $8.3 million for the third quarter of 2012.  Service charge revenue was $13.9 million for the fourth quarter of 2012, compared with $17.4 million for the fourth quarter of 2011 and $14.2 million for the third quarter of 2012.  Insurance commission revenue was $20.5 million for the fourth quarter of 2012, compared with $19.4 million for the fourth quarter of 2011 and $23.5 million for the third quarter of 2012.  The decrease in insurance commission revenue was seasonal, as fourth quarter policy renewals are typically lower than other quarters. 

Noninterest Expense

Noninterest expense for the fourth quarter of 2012 was $143.2 million, compared with $135.9 million for the fourth quarter of 2011 and $133.8 million for the third quarter of 2012.  Salaries and employee benefits expense increased to $77.2 million for the fourth quarter of 2012 from $70.5 million for the fourth quarter of 2011 and $74.8 million for the third quarter of 2012.    Foreclosed property expense increased to $12.0 million for the fourth quarter of 2012 from $10.8 million for the fourth quarter of 2011 and $8.8 million for the third quarter of 2012.  Deposit insurance assessments were $3.1 million for the fourth quarter of 2012 compared to $5.7 million for the fourth quarter of 2011 and $4.0 million for the third quarter of 2012.

Capital Management

BancorpSouth remains a "well capitalized" financial holding company, as defined by federal regulations, with Tier 1 risk-based capital of 13.82 percent at December 31, 2012 and total risk based capital of 15.08 percent, compared with required minimum levels of 6 percent and 10 percent, respectively, for "well capitalized" classification.  The Company's equity capitalization consists of 100 percent common stock.  BancorpSouth's ratio of shareholders' equity to assets was 10.82 percent at December 31, 2012, compared with 9.72 percent at December 31, 2011 and 10.93 percent at September 30, 2012.  The ratio of tangible shareholders' equity to tangible assets was 8.83 percent at December 31, 2012, compared with 7.67 percent at December 31, 2011 and 8.91 percent at September 30, 2012.

Summary

Patterson concluded, "Our fourth quarter results finalize a very successful and productive year in many aspects.  During 2012, we were able to reduce NPLs by over 25 percent, OREO by over 40 percent, and total NPAs by over 30 percent.  We experienced a record year in both mortgage production and mortgage lending income.  In addition, we achieved growth in other fee lines of business, including a 3.7 percent increase in insurance commissions.  As we enter 2013, we believe that this progress will be instrumental in helping us continue to enhance company performance despite industry headwinds." 

Rollins added, "Over the course of my first few weeks as CEO, I have had an opportunity to meet many of my teammates across several different markets.  I have experienced firsthand professionals who share my desire to help our company succeed.  BancorpSouth has a history of over 135 years as a well-respected organization with a strong commitment to the values of client service and community support.  Our team clearly understands that the industry landscape has changed.  Regulatory measures have placed pressure on NSF and card fee income and the credit cycle has resulted in declining loan balances, both of which have contributed to declines in profitability.   Our team understands that growth is the real key to battling industry headwinds and to improving profitability."

Conference Call

BancorpSouth will conduct a conference call to discuss its fourth quarter 2012 results on January 24, 2013, 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.

Forward-Looking Statements

Certain statements contained in this news release may not be based on 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," "estimate," "expect," "may," "might," "will," "would," "could" or "intend."  These forward-looking statements include, without limitation, statements relating to the disposition and the aggressive pricing of certain OREO properties, credit quality and operating performance, profitability, and our use of non-GAAP financial measures.

We caution you 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 because of a variety of factors.  These factors may include, but are not limited to, conditions in the financial markets and economic conditions generally, the ongoing debt crisis and the downgrade of the sovereign credit ratings for various nations, the adequacy of the Company's provision and allowance for credit losses to cover actual credit losses, the credit risk associated with real estate construction, acquisition and development loans, losses resulting from the significant amount of the Company's other real estate owned, limitations on the Company's ability to declare and pay dividends, the short-term and long-term impact of changes to banking capital standards on the Company's regulatory capital and liquidity, the impact of legal or administrative proceedings, the availability of capital on favorable terms if and when needed, liquidity risk, governmental regulation, including the Dodd Frank Act, supervision of the Company's operations, the impact of regulations on service charges on the Company's core deposit accounts, the susceptibility of the Company's business to local economic 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 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, 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, 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 effectiveness of the Company's internal controls, other factors generally understood to affect the financial results of financial services companies and other factors detailed from time to time in the Company's press releases and filings with the Securities and Exchange Commission. 

BancorpSouth, Inc. is a financial holding company headquartered in Tupelo, Mississippi, with $13.4 billion in assets.  BancorpSouth Bank, a wholly-owned subsidiary of BancorpSouth, Inc., operates 293 commercial banking, mortgage, insurance, trust and broker/dealer locations in Alabama, Arkansas, Florida, Louisiana, Mississippi, Missouri, Tennessee and Texas, including an insurance location in Illinois.

















BancorpSouth, Inc.








Selected Financial Data









Three Months Ended


Twelve Months Ended


December 31,


December 31,


2012


2011


2012


2011

(Dollars in thousands, except per share amounts)








Earnings Summary:








Net interest revenue

$       100,861


$        107,489


$        414,591


$        434,913

Provision for credit losses

6,000


19,250


28,000


130,081

Noninterest revenue

70,901


65,335


280,149


270,845

Noninterest expense

143,219


135,856


549,193


533,633

Income before income taxes

22,543


17,718


117,547


42,044

Income tax provision

5,563


4,415


33,252


4,475

Net income

$         16,980


$          13,303


$          84,295


$          37,569

Earnings per share:  Basic

$             0.18


$              0.16


$              0.90


$              0.45

                                    Diluted

$             0.18


$              0.16


$              0.90


$              0.45

















Balance sheet data at December 31:








Total assets





$   13,397,198


$   12,995,851

Total earning assets





12,179,958


11,770,950

Loans and leases, net of unearned income





8,636,989


8,870,311

Allowance for credit losses





164,466


195,118

Total deposits





11,088,146


10,955,189

Common shareholders' equity





1,449,052


1,262,912

Book value per share





15.34


15.13

Tangible book value per share





12.25


11.68

















Average balance sheet data:








Total assets

$  13,143,193


$   13,046,779


$   13,067,276


$   13,280,047

Total earning assets

12,045,432


11,918,358


11,960,971


12,143,391

Loans and leases, net of unearned interest

8,635,139


8,954,229


8,719,399


9,159,431

Total deposits

10,938,246


11,017,231


10,936,694


11,251,406

Common shareholders' equity

1,454,417


1,268,905


1,413,667


1,240,768









Non-performing assets at December 31:








Non-accrual loans and leases





$        207,241


$        276,798

Loans and leases 90+ days past due, still accruing





1,210


3,434

Restructured loans and leases, still accruing





25,099


42,018

Other real estate owned





103,248


173,805

Total non-performing assets





336,798


496,055









Net charge-offs as a percentage 








     of average loans (annualized)

0.49%


1.06%


0.67%


1.44%









Performance ratios (annualized):








Return on average assets

0.51%


0.40%


0.65%


0.28%

Return on common equity

4.64%


4.16%


5.96%


3.03%

Total shareholders' equity to total assets

10.82%


9.72%


10.82%


9.72%

Tangible shareholders' equity to tangible assets

8.83%


7.67%


8.83%


7.67%

Net interest margin

3.44%


3.69%


3.57%


3.69%









Average shares outstanding - basic

94,440,184


83,488,102


93,760,604


83,486,296

Average shares outstanding - diluted

94,560,226


83,503,611


93,850,104


83,509,759

Cash dividends per share

$0.01


$0.01


$0.04


$0.14









Tier 1 capital

13.82%

(1)

11.77%


13.82%

(1)

11.77%

Total capital

15.08%

(1)

13.03%


15.08%

(1)

13.03%

Tier 1 leverage capital

10.25%

(1)

8.85%


10.25%

(1)

8.85%

(1)  Estimated as of earnings release date








  

BancorpSouth, Inc.

Consolidated Balance Sheets

(Unaudited)








Dec-12

Sep-12

Jun-12

Mar-12

Dec-11


(Dollars in thousands)

Assets






Cash and due from banks

$                223,814

$                176,529

$                224,084

$                184,441

$                195,681

Interest bearing deposits with other banks

979,800

757,207

603,458

665,675

303,663

Available-for-sale securities, at fair value

2,434,032

2,483,606

2,462,831

2,573,535

2,513,518

Loans and leases

8,672,752

8,716,715

8,771,642

8,777,538

8,911,258

  Less:  Unearned income

35,763

36,746

39,247

39,615

40,947

             Allowance for credit losses

164,466

169,019

175,847

181,777

195,118

Net loans and leases

8,472,523

8,510,950

8,556,548

8,556,146

8,675,193

Loans held for sale

129,138

129,408

108,134

110,294

83,458

Premises and equipment, net

319,456

321,068

320,419

321,720

323,383

Accrued interest receivable

44,356

48,314

47,358

50,008

51,266

Goodwill

275,173

275,173

271,297

271,297

271,297

Bank owned life insurance

231,120

203,798

202,620

202,698

200,085

Other real estate owned

103,248

128,211

143,615

167,808

173,805

Other assets

184,538

201,473

207,454

203,950

204,502

Total Assets

$           13,397,198

$           13,235,737

$           13,147,818

$           13,307,572

$           12,995,851

Liabilities






Deposits:






  Demand:  Noninterest bearing

$             2,545,169

$             2,492,508

$             2,312,044

$             2,260,012

$             2,269,799

                  Interest bearing

4,799,496

4,697,260

4,782,243

4,897,585

4,706,825

  Savings

1,145,785

1,103,490

1,083,255

1,067,256

991,702

  Other time

2,597,696

2,681,382

2,778,795

2,857,469

2,986,863

Total deposits

11,088,146

10,974,640

10,956,337

11,082,322

10,955,189

Federal funds purchased and






    securities sold under agreement






    to repurchase

414,611

377,676

361,990

401,089

373,933

Short-term Federal Home Loan Bank borrowings






   and other short-term borrowing

-

-

1,500

1,500

1,500

Accrued interest payable

6,140

6,759

7,161

7,652

8,644

Junior subordinated debt securities

160,312

160,312

160,312

160,312

160,312

Long-term Federal Home Loan Bank borrowings

33,500

33,500

33,500

33,500

33,500

Other liabilities

245,437

236,147

208,707

228,998

199,861

Total Liabilities

11,948,146

11,789,034

11,729,507

11,915,373

11,732,939

Shareholders' Equity






Common stock

236,094

236,102

236,091

236,090

208,709

Capital surplus

312,190

311,271

310,388

309,426

227,567

Accumulated other comprehensive income (loss)

(8,646)

5,952

1,334

(4,136)

(2,261)

Retained earnings

909,414

893,378

870,498

850,819

828,897

Total Shareholders' Equity

1,449,052

1,446,703

1,418,311

1,392,199

1,262,912

Total Liabilities & Shareholders' Equity

$           13,397,198

$           13,235,737

$           13,147,818

$           13,307,572

$           12,995,851







 








BancorpSouth, Inc.

Consolidated Average Balance Sheets

(Unaudited)









Dec-12

Sep-12

Jun-12

Mar-12

Dec-11



(Dollars in thousands)


Assets







Cash and due from banks

$                164,801

$                152,228

$                152,907

$                160,827

$                151,004


Interest bearing deposits with other banks

849,710

605,270

574,624

603,714

384,231


Available-for-sale securities, at fair value

2,454,031

2,481,201

2,520,932

2,507,941

2,509,943


Federal funds sold and securities







     purchased under agreement to resell

-

2,717

-

274

2,174


Loans and leases

8,671,559

8,755,094

8,774,767

8,832,104

8,995,035


  Less:  Unearned income

36,420

38,448

39,542

40,562

40,806


             Allowance for credit losses

170,081

179,283

185,209

202,158

208,005


Net loans and leases

8,465,058

8,537,363

8,550,016

8,589,384

8,746,224


Loans held for sale

106,552

118,944

77,642

61,250

67,781


Premises and equipment, net

320,439

320,234

320,731

322,641

322,544


Accrued interest receivable

43,144

44,789

45,494

47,512

49,256


Goodwill

275,173

273,867

271,297

271,297

271,297


Bank owned life insurance

208,504

203,151

202,616

200,724

198,892


Other real estate owned

119,852

134,384

155,471

170,924

164,841


Other assets

135,929

144,868

146,501

151,870

178,592


Total Assets

$           13,143,193

$           13,019,016

$           13,018,231

$           13,088,358

$           13,046,779


Liabilities







Deposits:







  Demand:  Noninterest bearing

$             2,482,168

$             2,328,948

$             2,248,914

$             2,139,371

$             2,248,904


                  Interest bearing

4,703,500

4,704,896

4,769,340

4,960,060

4,714,059


  Savings

1,117,297

1,092,802

1,074,912

1,027,611

975,892


  Other time

2,635,281

2,729,878

2,815,753

2,916,910

3,078,376


Total deposits

10,938,246

10,856,524

10,908,919

11,043,952

11,017,231


Federal funds purchased and







    securities sold under agreement







    to repurchase

401,968

388,817

374,982

358,124

430,968


Short-term Federal Home Loan Bank borrowings







   and other short-term borrowing

-

1,223

1,500

1,500

1,500


Accrued interest payable

7,613

8,404

8,605

9,392

10,617


Junior subordinated debt securities

160,312

160,312

160,312

160,312

160,312


Long-term Federal Home Loan Bank borrowings

33,500

33,500

33,500

33,500

33,500


Other liabilities

147,137

138,079

126,680

117,869

123,746


Total Liabilities

11,688,776

11,586,859

11,614,498

11,724,649

11,777,874


Shareholders' Equity







Common stock

236,103

236,095

236,091

231,276

208,722


Capital surplus

311,634

310,642

309,634

294,973

227,201


Accumulated other comprehensive (loss) income

1,260

2,900

(4,020)

(2,269)

8,927


Retained earnings

905,420

882,520

862,028

839,729

824,055


Total Shareholders' Equity

1,454,417

1,432,157

1,403,733

1,363,709

1,268,905


Total Liabilities & Shareholders' Equity

$           13,143,193

$           13,019,016

$           13,018,231

$           13,088,358

$           13,046,779


 

BancorpSouth, Inc.

Consolidated Condensed Statements of Income

(Dollars in thousands, except per share data)

(Unaudited)
















Quarter Ended


Year To Date


Dec-12


Sep-12


Jun-12


Mar-12


Dec-11


Dec-12


Dec-11

INTEREST REVENUE:














Loans and leases

$  102,925


$  105,937


$    107,737


$  109,012


$  112,566


$ 425,611


$ 461,076

Deposits with other banks

529


399


382


401


252


1,711


701

Federal funds sold and securities purchased














   under agreement to resell

-


2


1


-


1


3


167

Held-to-maturity securities:














    Taxable

-


-


-


-


-


-


13,080

    Tax-exempt

-


-


-


-


-


-


5,638

Available-for-sale securities:














    Taxable

8,729


9,329


10,188


11,162


11,781


39,408


43,989

    Tax-exempt

4,083


4,109


4,210


4,256


4,158


16,658


10,983

Loans held for sale

829


974


686


544


635


3,033


2,219

        Total interest revenue

117,095


120,750


123,204


125,375


129,393


486,424


537,853















INTEREST EXPENSE:














Interest bearing demand

3,588


3,889


4,185


4,449


4,737


16,111


22,646

Savings

606


686


691


714


747


2,697


3,211

Other time

8,749


9,482


10,275


11,291


13,104


39,797


61,709

Federal funds purchased and securities sold














   under agreement to repurchase

72


73


66


63


76


274


458

FHLB borrowings

349


364


366


367


367


1,446


3,459

Junior subordinated debt

2,869


2,875


2,879


2,879


2,871


11,502


11,451

Other

1


2


1


2


2


6


6

        Total interest expense

16,234


17,371


18,463


19,765


21,904


71,833


102,940















        Net interest revenue

100,861


103,379


104,741


105,610


107,489


414,591


434,913

  Provision for credit losses

6,000


6,000


6,000


10,000


19,250


28,000


130,081

        Net interest revenue, after provision for














          credit losses

94,861


97,379


98,741


95,610


88,239


386,591


304,832















NONINTEREST REVENUE:














Mortgage lending

17,188


13,549


11,040


15,142


8,928


56,919


17,069

Credit card, debit card and merchant fees

8,125


8,270


7,787


7,523


7,783


31,705


42,373

Service charges

13,875


14,189


13,697


15,116


17,412


56,877


66,670

Trust income

3,391


3,101


3,139


2,282


3,348


11,913


12,186

Security gains, net

152


39


177


74


18


442


12,127

Insurance commissions

20,502


23,519


22,964


23,153


19,416


90,138


86,918

Other

7,668


7,753


7,664


9,070


8,430


32,155


33,502

        Total noninterest revenue

70,901


70,420


66,468


72,360


65,335


280,149


270,845















NONINTEREST EXPENSE:














Salaries and employee benefits

77,203


74,829


77,661


74,931


70,512


304,624


282,880

Occupancy, net of rental income

10,643


10,944


10,487


10,066


10,315


42,140


42,362

Equipment

5,309


5,083


5,124


5,333


5,108


20,849


21,707

Deposit insurance assessments

3,103


3,998


3,994


5,383


5,674


16,478


21,316

Prepayment penalty on FHLB borrowings

-


-


-


-


-


-


9,778

Other

46,961


38,934


39,240


39,967


44,247


165,102


155,590

        Total noninterest expenses

143,219


133,788


136,506


135,680


135,856


549,193


533,633

        Income before income taxes

22,543


34,011


28,703


32,290


17,718


117,547


42,044

Income tax expense

5,563


10,186


8,079


9,424


4,415


33,252


4,475

        Net income

$    16,980


$   23,825


$     20,624


$    22,866


$   13,303


$  84,295


$  37,569















Net income per share: Basic

$        0.18


$       0.25


$         0.22


$        0.25


$       0.16


$      0.90


$      0.45

                                  Diluted

$        0.18


$       0.25


$         0.22


$        0.25


$       0.16


$      0.90


$      0.45















 

BancorpSouth, Inc.


Selected Loan Data


(Dollars in thousands)


(Unaudited)














Quarter Ended



Dec-12


Sep-12


Jun-12


Mar-12


Dec-11


LOAN AND LEASE PORTFOLIO:











Commercial and industrial

$ 1,476,611


$ 1,462,719


$ 1,497,678


$ 1,441,727


$ 1,473,728


Real estate











   Consumer mortgages

1,873,875


1,888,783


1,904,420


1,937,997


1,945,190


   Home equity

486,074


492,833


496,245


501,331


514,362


   Agricultural

256,196


257,733


251,975


256,683


239,487


   Commercial and industrial-owner occupied

1,333,103


1,309,631


1,288,887


1,287,542


1,301,575


   Construction, acquisition and development

735,808


823,692


835,022


858,110


908,362


   Commercial real estate

1,748,881


1,738,516


1,748,748


1,742,001


1,754,022


Credit cards

104,884


101,405


101,085


100,527


106,281


All other

621,557


604,657


608,335


612,005


627,304


     Total loans

$ 8,636,989


$ 8,679,969


$ 8,732,395


$ 8,737,923


$ 8,870,311













ALLOWANCE FOR CREDIT LOSSES:











Balance, beginning of period

$    169,019


$    175,847


$    181,777


$    195,118


$    199,686













Loans and leases charged off:











Commercial and industrial

(2,174)


(4,334)


(1,582)


(4,272)


(1,677)


Real estate











   Consumer mortgages

(3,789)


(2,299)


(2,818)


(4,216)


(2,953)


   Home equity

(1,064)


(270)


(536)


(851)


(1,667)


   Agricultural

(456)


(302)


(386)


(96)


(110)


   Commercial and industrial-owner occupied

(1,421)


(994)


(2,732)


(3,868)


(1,136)


   Construction, acquisition and development

(5,286)


(6,845)


(9,560)


(11,394)


(10,539)


   Commercial real estate

(4,026)


(2,633)


(3,260)


(2,809)


(6,858)


Credit cards

(531)


(540)


(588)


(562)


(706)


All other

(977)


(731)


(438)


(758)


(794)


     Total loans charged off

(19,724)


(18,948)


(21,900)


(28,826)


(26,440)













Recoveries:











Commercial and industrial

3,507


1,007


1,040


1,542


446


Real estate











   Consumer mortgages

819


256


438


323


263


   Home equity

66


37


78


315


43


   Agricultural

10


53


53


10


76


   Commercial and industrial-owner occupied

561


270


1,514


351


100


   Construction, acquisition and development

1,621


2,676


1,955


2,155


971


   Commercial real estate

2,208


1,443


4,504


383


340


Credit cards

144


144


121


118


168


All other

235


234


267


288


215


     Total recoveries

9,171


6,120


9,970


5,485


2,622













Net charge-offs

(10,553)


(12,828)


(11,930)


(23,341)


(23,818)













Provision charged to operating expense

6,000


6,000


6,000


10,000


19,250


Balance, end of period

$    164,466


$    169,019


$    175,847


$    181,777


$    195,118













Average loans for period

$ 8,635,139


$ 8,716,646


$ 8,735,225


$ 8,791,542


$ 8,954,229













Ratio:











Net charge-offs to average loans (annualized)

0.49%


0.59%


0.55%


1.06%


1.06%



















BancorpSouth, Inc.


Selected Loan Data


(Dollars in thousands)


(Unaudited)














Quarter Ended



Dec-12


Sep-12


Jun-12


Mar-12


Dec-11


NON-PERFORMING ASSETS











NON-PERFORMING LOANS AND LEASES:











  Nonaccrual Loans and Leases











    Commercial and industrial

$      9,311


$         8,674


$       13,156


$    11,025


$       12,260


    Real estate











       Consumer mortgages

36,133


35,599


35,660


46,562


47,878


       Home equity

3,497


3,471


2,995


2,687


2,036


       Agricultural

7,587


7,190


8,390


4,254


4,179


       Commercial and industrial-owner occupied

20,910


27,059


26,957


32,842


33,112


       Construction, acquisition and development

66,635


92,351


104,283


115,649


133,110


       Commercial real estate

57,656


40,514


44,359


35,715


40,616


    Credit cards

415


465


364


509


594


    All other

5,097


4,415


4,082


3,984


3,013


         Total nonaccrual loans and leases

$  207,241


$     219,738


$     240,246


$  253,227


$     276,798













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











    Commercial and industrial

$         414


$              45


$                -


$          10


$              12


    Real estate











       Consumer mortgages

512


1,027


1,141


1,314


2,974


       Home equity

-


-


-


-


-


       Agricultural

10


-


-


-


-


       Commercial and industrial-owner occupied

19


119


-


-


-


       Construction, acquisition and development

-


-


-


-


-


       Commercial real estate

-


-


-


-


-


    Credit cards

228


236


324


228


299


    All other

27


15


167


146


149


         Total loans and leases 90+ days past due, still accruing

1,210


1,442


1,632


1,698


3,434













  Restructured Loans and Leases, Still Accruing

25,099


26,147


25,071


30,311


42,018


     Total non-performing loans and leases

233,550


247,327


266,949


285,236


322,250













OTHER REAL ESTATE OWNED:

103,248


128,211


143,615


167,808


173,805













Total Non-performing Assets

$  336,798


$     375,538


$     410,564


$  453,044


$     496,055













Additions to Nonaccrual Loans and Leases During the Quarter

$    44,674


$       28,918


$       41,121


$    40,392


$       39,474













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











    Commercial and industrial

$      3,080


$         6,065


$         3,040


$      4,809


$         8,065


    Real estate











       Consumer mortgages

13,403


14,745


14,436


10,736


15,864


       Home equity

1,272


1,766


1,311


2,248


2,037


       Agricultural

306


977


471


663


339


       Commercial and industrial-owner occupied

3,498


4,859


2,745


3,332


2,154


       Construction, acquisition and development

2,303


8,528


2,062


2,431


2,714


       Commercial real estate

1,176


3,210


1,288


2,104


3,292


    Credit cards

777


734


673


686


802


    All other

2,422


2,861


2,544


1,983


2,280


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

$    28,237


$       43,745


$       28,570


$    28,992


$       37,547













Credit Quality Ratios:











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

0.28%


0.28%


0.27%


0.45%


0.86%


Allowance for credit losses to net loans and leases

1.90%


1.95%


2.01%


2.08%


2.20%


Allowance for credit losses to non-performing assets

48.83%


45.01%


42.83%


40.12%


39.33%


Allowance for credit losses to non-performing loans and leases

70.42%


68.34%


65.87%


63.73%


60.55%


Non-performing loans and leases to net loans and leases

2.70%


2.85%


3.06%


3.26%


3.63%


Non-performing assets to net loans and leases

3.90%


4.33%


4.70%


5.18%


5.59%


 

BancorpSouth, Inc.


Selected Loan Data


(Dollars in thousands)


(Unaudited)














Quarter Ended



Dec-12


Sep-12


Jun-12


Mar-12


Dec-11


REAL ESTATE CONSTRUCTION, ACQUISITION 











   AND DEVELOPMENT ("CAD") PORTFOLIO:











  Outstanding Balance











     Multi-family construction

$       6,542


$         4,546


$         2,378


$       4,683


$         2,138


     One-to-four family construction

177,392


189,561


182,648


159,281


169,827


     Recreation and all other loans

44,840


62,888


66,033


63,407


67,235


     Commercial construction

114,099


126,296


112,929


122,173


130,124


     Commercial acquisition and development

161,546


177,887


182,570


191,783


197,044


     Residential acquisition and development

231,389


262,514


288,464


316,783


341,994


         Total outstanding balance

$   735,808


$      823,692


$      835,022


$   858,110


$      908,362













  Nonaccrual CAD Loans











     Multi-family construction

$               -


$                 -


$                  -


$               -


$          1,067


     One-to-four family construction

10,609


14,171


15,490


11,953


14,690


     Recreation and all other loans

1,160


1,166


380


386


436


     Commercial construction

5,889


6,991


4,318


3,702


5,235


     Commercial acquisition and development

17,337


21,408


21,741


23,464


23,968


     Residential acquisition and development

31,640


48,615


62,354


76,144


87,714


         Total nonaccrual CAD loans

66,635


92,351


104,283


115,649


133,110













  CAD Loans 90+ Days Past Due, Still Accruing:











     Multi-family construction

-


-


-


-


-


     One-to-four family construction

-


-


-


-


-


     Recreation and all other loans

-


-


-


-


-


     Commercial construction

-


-


-


-


-


     Commercial acquisition and development

-


-


-


-


-


     Residential acquisition and development

-


-


-


-


-


         Total CAD loans 90+ days past due, still accruing

-


-


-


-


-













  Restructured CAD Loans, Still Accruing











     Multi-family construction

-


-


-


-


-


     One-to-four family construction

781


787


793


799


318


     Recreation and all other loans

17


20


842


847


852


     Commercial construction

-


-


-


977


-


     Commercial acquisition and development

458


133


260


2,975


433


     Residential acquisition and development

4,107


4,149


4,048


106


446


         Total restructured CAD loans, still accruing

5,363


5,089


5,943


5,704


2,049













        Total Non-performing CAD loans

$     71,998


$       97,440


$      110,226


$   121,353


$      135,159













  CAD NPL as a % of Outstanding CAD Balance











     Multi-family construction

-


-


-


-


49.9%


     One-to-four family construction

6.4%


7.9%


8.9%


8.0%


8.8%


     Recreation and all other loans

2.6%


1.9%


1.9%


1.9%


1.9%


     Commercial construction

5.2%


5.5%


3.8%


3.8%


4.0%


     Commercial acquisition and development

11.0%


12.1%


12.1%


13.8%


12.4%


     Residential acquisition and development

15.4%


20.1%


23.0%


24.1%


25.8%


         Total CAD NPL as a % of outstanding CAD balance

9.8%


11.8%


13.2%


14.1%


14.9%


 

BancorpSouth, Inc.





Selected Loan Data





(Dollars in thousands)





(Unaudited)




















December 31, 2012




Special












Pass


Mention


Substandard


Doubtful


Loss


Impaired


Total

LOAN PORTFOLIO BY INTERNALLY ASSIGNED GRADE:














Commercial and industrial

$ 1,426,498


$       14,663


$       29,876


$        729


$                -


$    4,845


$ 1,476,611

Real estate














   Consumer mortgages

1,691,682


32,840


131,141


2,907


198


15,107


1,873,875

   Home equity

461,151


4,791


17,619


1,057


76


1,380


486,074

   Agricultural

227,138


5,729


17,947


-


-


5,382


256,196

   Commercial and industrial-owner occupied

1,202,111


31,087


82,816


369


-


16,720


1,333,103

   Construction, acquisition and development

567,881


30,846


75,031


715


-


61,335


735,808

   Commercial real estate

1,524,262


53,455


120,591


160


-


50,413


1,748,881

Credit cards

104,884


-


-


-


-


-


104,884

All other

600,807


8,397


10,196


601


10


1,546


621,557

     Total loans

$ 7,806,414


$      181,808


$      485,217


$      6,538


$            284


$ 156,728


$ 8,636,989






























September 30, 2012




Special












Pass


Mention


Substandard


Doubtful


Loss


Impaired


Total

LOAN PORTFOLIO BY INTERNALLY ASSIGNED GRADE:














Commercial and industrial

$ 1,403,199


$       10,018


$       42,399


$        867


$             17


$    6,219


$ 1,462,719

Real estate














   Cons