MidSouth Bancorp, Inc. Reports Fourth Quarter 2011 Results

- Reported EPS of $.09 per diluted share; operating EPS of $0.17 per diluted share

- Significant items impacting 4th quarter results: merger related charges of $0.08 per share

- First Louisiana and Tyler acquisitions closed and systems conversions complete

- Total assets stand at $1.4 billion after completion of acquisitions

- Nonperforming assets down 32% YOY and down 8% from linked-quarter

31 Jan, 2012, 09:15 ET from MidSouth Bancorp, Inc.

LAFAYETTE, La., Jan. 31, 2012 /PRNewswire/ -- MidSouth Bancorp, Inc. ("MidSouth") (NYSE Amex: MSL) today reported net earnings available to common shareholders of $879,000 for the fourth quarter of 2011, compared to net earnings available to common shareholders of $1.6 million reported for the fourth quarter of 2010 and $296,000 in net earnings available to common shareholders for the third quarter of 2011.  Diluted earnings for the fourth quarter of 2011 were $0.09 per common share, down from the $0.16 per common share for the fourth quarter of 2010 and up from the $.03 per common share reported for the third quarter of 2011.  

(Logo:  http://photos.prnewswire.com/prnh/20100125/MIDSOUTHLOGO)

C.R. "Rusty" Cloutier, President and Chief Executive Officer, commenting on fourth quarter results, remarked "In December, we completed the acquisition and systems conversion of the Beacon Federal branch in Tyler, Texas ("Tyler") and First Louisiana National Bank in Breaux Bridge, Louisiana ("FLNB").  As a result, the fourth quarter included $0.08 per share of merger related expenses.  Excluding these non-operating expenses, we had strong operating earnings per share in the quarter of $0.17 versus $0.14 in the third quarter.  We are very excited to expand our market presence in Texas and Louisiana and look forward to the positive impact of these acquisitions on our franchise and to future earnings."

Dividends paid on the Series B Preferred Stock totaled $400,000 for the fourth quarter of 2011 based on a dividend rate of 5%.  In August 2011, the Company issued $32.0 million in Series B Preferred Stock to the Treasury in connection with the Small Business Lending Fund ("SBLF").  The dividend rate on the Series B Preferred Stock going forward will be between 1% and 5% based on our level of qualified small business loans.  Linked-quarter net earnings available to common shareholders were impacted by the repayment of $20.0 million in Series A Preferred Stock issued to the Treasury under the Capital Purchase Plan ("CPP") with funds from the U.S. Treasury that were authorized by Congress under the Small Business Jobs Act of 2010.  Repayment of the Series A Preferred Stock under the CPP resulted in accelerated accretion of discount on the preferred stock of approximately $444,000 in the third quarter of 2011, or approximately $0.05 per share.  

For the year ended December 31, 2011, net income available to common shareholders totaled $2.7 million compared to $4.6 million for the year ended December 31, 2010.  Operating earnings per share were $0.48 for 2011, compared to $0.47 for 2010.

Balance Sheet

Total consolidated assets at December 31, 2011 were $1.4 billion, compared to $1.0 billion at December 31, 2010.  Deposits totaled $1.2 billion at year-end 2011, compared to $800.8 million at year-end 2010.  Total loans were $746.3 million at December 31, 2011 compared to $580.8 million at December 31, 2010.  

The Company's subsidiary, MidSouth Bank, N.A. ("the Bank") completed the acquisition of $48.0 million in loans and $104.0 million in deposits from FLNB on December 1, 2011.  A second acquisition closed on December 2, 2011 and included the purchase of $22.2 million in loans and the assumption of $79.8 million in deposits with the Tyler branch.  The Bank also completed the acquisition of five Jefferson Bank branches in the Dallas-Fort Worth market from First Bank and Trust Company of Lubbock, Texas on July 29, 2011.  The Bank acquired $68.9 million in performing loans, including $59.8 million of Jefferson Bank loans and $9.1 million of participation loans from First Bank and Trust.  Jefferson Bank deposits assumed with the purchase totaled $164.3 million.

MidSouth's leverage capital ratio was 11.14% at December 31, 2011 compared to 14.00% at December 31, 2010.  Tier 1 risk-based capital and total risk-based capital ratios were 16.10% and 16.97% at December 31, 2011, compared to 21.11% and 22.36% at December 31, 2010, respectively.  The Tier 1 common equity leverage ratio at December 31, 2011 was 7.61% and tangible book value was $9.34 per common share for the same period.  Tangible common equity totaled $97.7 million at December 31, 2011, compared to $107.9 million at December 31, 2010.  Tangible common equity declined as a result of goodwill and intangibles added with the three acquisitions closed in the second half of 2011.

Asset Quality

Nonperforming assets declined 32.3% in year-over-year comparison and 7.6% in linked-quarter comparison as the Company continued to successfully work problem assets off the balance sheet.  Total nonperforming assets were reduced from $20.9 million at December 31, 2010 to $14.2 million at December 31, 2011, a $6.7 million reduction that included the charge-off of $2.8 million in specific reserves related to two commercial credits in the first quarter of 2011.  The two credits were transferred into Other Real Estate ("ORE") during the second and third quarters of 2011.  Additionally, a $1.6 million credit was sold in the first quarter of 2011 and a $2.7 million national participation credit was sold in the third quarter of 2011 to further reduce nonperforming assets.

Allowance coverage for nonperforming loans increased to 112.63% at December 31, 2011, compared to 44.81% at December 31, 2010, due to a $13.2 million reduction in nonperforming loans.  The ALL/total loans ratio decreased to 0.97% for the year ended December 31, 2011, compared to 1.52% at December 31, 2010, primarily due to the $139.1 million in loans added through the three acquisitions completed in the third and fourth quarters of 2011.  The $139.1 million in acquired loans had the impact of reducing the December 31, 2011 ALL/total loans ratio by approximately 23 basis points as compared to the June 30, 2011 ALL/total loans ratio prior to the acquisitions.  The ratio of net charge-offs to total loans was 0.73% for year-end 2011 compared to 0.72% for year-end 2010.

Loans past due 90 days or more and still accruing totaled $231,000 at December 31, 2011, an increase of $165,000 from December 31, 2010.  Total nonperforming assets to total loans plus ORE and other assets repossessed were 1.88% at December 31, 2011, compared to 3.59% at December 31, 2010.  Loans classified as troubled debt restructurings totaled $456,000 at December 31, 2011.  Classified assets, including ORE, decreased $5.1 million, or 16.1% during the fourth quarter of 2011, from $31.8 million at September 30, 2011 to $26.7 million at December 31, 2011.  The decrease in classified assets resulted primarily from the payout of two commercial loans totaling $3.2 million and a credit quality upgrade on a $1.8 million commercial loan.  

Mr. Cloutier, commenting on MidSouth's asset quality, remarked, "We are pleased with the progress we made reducing classified assets during 2011.  The fourth quarter payout of two loans and a credit quality upgrade on a third loan contributed to a 30% reduction in classified assets year-over-year.  Earlier in the year, two of the three largest non-performing assets going into 2011 were liquidated and the third is in ORE producing positive cash flow from net rental income on a monthly basis."

Earnings

Fourth Quarter 2011 vs. Fourth Quarter 2010 Earnings Comparison

Fourth quarter 2011 net earnings before dividends on preferred stock totaled $1.3 million compared to $1.9 million for the fourth quarter of 2010.  Net earnings decreased as a $2.6 million increase in net interest income and a $95,000 decrease in the provision for loan losses were offset by a $3.4 million increase in non-interest expense and a $36,000 decline in non-interest income.  Of the $2.6 million increase in net interest income, a total of $1.4 million was earned from the branches acquired in the third and fourth quarters.  The $1.4 million included the impact of purchase accounting adjustments and excluded interest income on excess funds available for investment as a result of the acquisitions.  Interest income on investments and other interest-bearing accounts increased $753,000 in quarterly comparison and included interest earned on excess cash invested from the acquisitions.  A $333,000 decrease in service charges on deposit accounts, primarily as a result of fewer insufficient funds ("NSF") transactions processed, was mostly offset by a $134,000 increase in ATM/debit card income and by $174,000 in other non-interest income recorded on ORE.  Non-interest expense increased $3.4 million in prior year quarterly comparison and included $1.3 million in merger and conversion expenses related to the acquisitions.  Operating expenses recorded for the acquired branches during the fourth quarter 2011 totaled $1.1 million, including amortization costs of core deposit intangibles resulting from the acquisitions.  Other increases in non-interest expenses (exclusive of merger, conversion, and acquired operating costs) included $306,000 in salaries and benefits costs, $291,000 in data processing expenses, $208,000 in marketing costs, and $172,000 in legal and professional fees.  

Fourth Quarter 2011 vs. Third Quarter 2011 Earnings Comparison

In linked-quarter comparison, net earnings before dividends on preferred stock increased $179,000 as a $1.4 million increase in net interest income offset a $125,000 increase in provision for loan loss and a $1.0 million increase in non-interest expenses.  Increases in noninterest expenses (including merger, conversion, and acquired operating costs) consisted primarily of approximately $705,000 in data processing expense and $287,000 in marketing costs.  Linked-quarter decreases in legal and professional fees ($265,000) and expenses on ORE ($270,000) offset minimal increases in several other non-interest expense categories.

Year-Over-Year Earnings Comparison

In year-over-year comparison, net earnings before dividends on preferred stock decreased $1.3 million primarily as a result of a $5.5 million increase in non-interest expense and a $1.8 million reduction in non-interest income which offset a $4.5 million improvement in net interest income and a $1.1 million decrease in provision for loan loss.  The $1.8 million decrease in non-interest income was driven by a $2.7 million reduction in NSF fee income due to a lower volume of NSF transactions processed.  Regulatory changes governing our ability to collect NSF fees implemented in the second half of 2010, combined with proactive steps taken during the first quarter of 2011 in response to guidance issued by the FDIC, have significantly lowered our NSF fee income.  Additional regulatory changes regarding electronic transactions could further reduce our non-interest income earned in future periods.  Other increases in non-interest expense (exclusive of merger, conversion, and acquired operating costs) included primarily $749,000 in salary and benefits costs, $713,000 in expenses on ORE and repossessed assets, and $309,000 in marketing costs.  The increased non-interest expenses were partially offset by a $423,000 reduction in internet banking processing costs.  

Net Interest Income Analysis  

Fully taxable-equivalent ("FTE") net interest income totaled $13.4 million and $10.9 million for the quarters ended December 31, 2011 and 2010, respectively.  The FTE net interest income increased $2.5 million in prior year comparison primarily due to a $234.9 million increase in the volume of average earning assets as a result of the three acquisitions.  The average volume of loans increased $115.6 million in quarterly comparison and the average yield on loans fell 19 basis points, from 6.88% to 6.69%.  Discount accretion on acquired loans added 16 basis points to the average yield on loans for the fourth quarter of 2011.  Net of the impact of discount accretion, average loan yields declined 35 basis points in prior year quarterly comparison to 6.53%.  Loan yields have declined primarily due to lower repricing rates as a result of a competitive environment and lower market interest rates.  

The average volume of investment securities increased $130.1 million in quarterly comparison as a portion of excess cash flow from the acquisition was placed primarily in agency mortgage-backed securities.  The average tax equivalent yield on investment securities decreased 39 basis points, from 3.39% to 3.00% primarily due to lower reinvestment rates.  The average volume of overnight interest bearing deposits earning 0.26% decreased $16.7 million due to the purchase of investment securities.  The average yield on all earning assets decreased 28 basis points in prior year quarterly comparison, from 5.40% for the fourth quarter of 2010 to 5.12% for the fourth quarter of 2011.   Net of the impact of discount accretion, the average yield on total earning assets declined 39 basis points, from 5.40% to 5.01% for the three month periods ended December 31, 2010 and 2011, respectively.

Interest expense decreased due to a 30 basis point reduction in the average rate paid on interest bearing liabilities, from 0.98% at December 31, 2010 to 0.68% at December 31, 2011.  The average volume of interest-bearing deposits increased $214.0 million in prior year quarterly comparison primarily due to deposits assumed with the three acquisitions.  Net of premium amortization on acquired certificates of deposit, the average rate paid on interest bearing liabilities was 0.83% for the fourth quarter of 2011 compared to 0.98% for the fourth quarter of 2010.  The average rate paid on interest bearing liabilities has decreased as offering rates on interest bearing deposits and repurchase agreements with bank customers have been adjusted closer to market rates over the past 12 months.

As a result of these changes in volume and yield on earning assets and interest bearing liabilities, the FTE net interest margin decreased 10 basis points, from 4.70% for the fourth quarter of 2010 to 4.60% for the fourth quarter of 2011.  Net of a 21 basis point effect of purchase accounting adjustments on loans and deposits, the FTE margin decreased 31 basis points, from 4.70% for the fourth quarter of 2010 to 4.39% for the fourth quarter of 2011.  

In year-to-date comparison, FTE net interest income increased $4.2 million primarily due to a $2.6 million increase in interest income and a $1.6 million reduction in interest expense.  Interest income on average earning assets increased $2.6 million in year-to-date comparison, as a $121.4 million increase in the average volume of earning assets offset a 41 basis point reduction in the average yield on earning assets, from 5.55% at December 31, 2010 to 5.14% at December 31, 2011.  Net of a 5 basis point effect of discount accretion on acquired loans, the average yield on earning assets was 5.10% at December 31, 2011.

Interest expense decreased in year-over-year comparison primarily due to a 35 basis point reduction in the average rate paid on interest-bearing liabilities, from 1.13% at December 31, 2010 to 0.78% at December 31, 2011, driven by a decrease in the average rate paid on interest-bearing deposits and repurchase agreements.  Net of a 7 basis point effect of premium amortization on acquired certificates of deposit, the average rate paid on interest-bearing liabilities was 0.85% at December 31, 2011 The FTE net interest margin declined 14 basis points, from 4.72% for the year ended December 31, 2010 to 4.58% for the year ended December 31, 2011.  Net of purchase accounting adjustments, the FTE net interest margin declined 24 basis points, from 4.72% to 4.48% for the year ended December 31, 2010 and 2011, respectively.

In linked-quarter comparison, FTE net interest income increased $1.4 million, primarily due to a $113.5 million increase in the average volume of earning assets as a result of the Tyler and FLNB branch acquisitions.  Average loan volume increased $61.0 million and the average yield on loans, net of discount accretion on acquired loans, decreased 7 basis points from 6.60% at September 30, 2011 to 6.53% at December 31, 2011.  The average volume of interest bearing liabilities increased $105.7 million in linked-quarter comparison, and the average rate paid decreased 4 basis points, net of premium amortization on acquired certificates of deposit, from 0.87% at September 30, 2011 to 0.83% at December 31, 2011.  Accordingly, the FTE margin decreased 5 basis points, net of purchase accounting adjustments, from 4.44% for the third quarter of 2011 to 4.39% for the fourth quarter of 2011.

About MidSouth Bancorp, Inc.

MidSouth Bancorp, Inc. is a bank holding company headquartered in Lafayette, Louisiana, with assets of $1.4 billion as of December 31, 2011. Through its wholly owned subsidiary, MidSouth Bank, N.A., MidSouth offers a full range of banking services to commercial and retail customers in Louisiana and Texas.  MidSouth Bank has 40 locations in Louisiana and Texas and is connected to a worldwide ATM network that provides customers with access to more than 43,000 surcharge-free ATMs. Additional corporate information is available at www.midsouthbank.com.

Forward-Looking Statements

Certain statements contained herein are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 and subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, which involve risks and uncertainties.  These statements include, among others, statements regarding future results, improvements in classified and criticized assets, changes in the local and national economy, the work-out of nonaccrual loans, the competition for other potential acquisitions, the impacts from the integration of operations from completed acquisitions and the impact of regulatory changes regarding electronic transactions.  Actual results may differ materially from the results anticipated in these forward-looking statements.  Factors that might cause such a difference include, among other matters, changes in interest rates and market prices that could affect the net interest margin, asset valuation, and expense levels; changes in local economic and business conditions, including, without limitation, changes related to the oil and gas industries, that could adversely affect customers and their ability to repay borrowings under agreed upon terms, adversely affect the value of the underlying collateral related to their borrowings, and reduce demand for loans; the timing and ability to reach any agreement to restructure nonaccrual loans;  increased competition for deposits and loans which could affect compositions, rates and terms; the timing and impact of future acquisitions, the success or failure of integrating operations, and the ability to capitalize on growth opportunities upon entering new markets; loss of critical personnel and the challenge of hiring qualified personnel at reasonable compensation levels; legislative and regulatory changes, including changes in banking, securities and tax laws and regulations and their application by our regulators, changes in the scope and cost of FDIC insurance and other coverage; and other factors discussed under the heading "Risk Factors" in MidSouth's Annual Report on Form 10-K for the year ended December 31, 2010 filed with the SEC on March 16, 2011 and in its other filings with the SEC.  MidSouth does not undertake any obligation to publicly update or revise any of these forward-looking statements, whether to reflect new information, future events or otherwise, except as required by law.

MIDSOUTH BANCORP, INC. and SUBSIDIARIES          

Condensed Consolidated Financial Information (unaudited)          

(in thousands except per share data)               

For the Quarter Ended

For the Quarter Ended

December 31,

%

September 30,

%

EARNINGS DATA

2011

2010

Change

2011

Change

     Total interest income

$               14,564

$               12,136

20.0%

$                       13,120

11.0%

     Total interest expense

1,489

1,630

-8.7%

1,462

1.8%

          Net interest income

13,075

10,506

24.5%

11,658

12.2%

     FTE net interest income

13,401

10,899

23.0%

11,992

11.7%

     Provision for loan losses

775

870

-10.9%

650

19.2%

     Non-interest income

3,420

3,456

-1.0%

3,398

0.6%

     Non-interest expense

14,169

10,798

31.2%

13,175

7.5%

          Earnings before income taxes

1,551

2,294

-32.4%

1,231

26.0%

     Income tax expense

272

438

-37.9%

131

107.6%

          Net earnings

1,279

1,856

-31.1%

1,100

16.3%

    Dividends on preferred stock

400

300

33.3%

804

-50.2%

         Net earnings available to common shareholders

$                    879

$                 1,556

-43.5%

$                            296

197.0%

PER COMMON SHARE DATA

     Basic earnings per share

$                   0.09

$                   0.16

-43.8%

$                           0.03

200.0%

     Diluted earnings per share

0.09

0.16

-43.8%

0.03

200.0%

     Quarterly dividends per share

0.07

0.07

0.0%

0.07

0.0%

     Book value at end of period

12.41

12.05

3.0%

12.47

-0.5%

     Tangible book value at period end

9.34

11.09

-15.8%

10.45

-10.6%

     Market price at end of period

13.01

15.36

-15.3%

10.75

21.0%

     Shares outstanding at period end

10,465,506

9,730,266

7.6%

9,730,265

7.6%

     Weighted average shares outstanding

        Basic

9,976,057

9,712,600

2.7%

9,726,024

2.57%

        Diluted

9,988,472

9,727,588

2.7%

9,740,275

2.55%

AVERAGE BALANCE SHEET DATA

     Total assets

$          1,273,272

$          1,004,098

26.8%

$                  1,148,516

10.9%

     Loans and leases

703,590

588,004

19.7%

642,601

9.5%

     Total deposits

1,035,792

789,784

31.1%

927,551

11.7%

    Total common equity

123,912

118,301

4.7%

120,216

3.1%

    Total tangible common equity

104,257

108,906

-4.3%

103,991

0.3%

     Total equity

155,912

137,687

13.2%

144,757

7.7%

SELECTED RATIOS

12/31/2011

12/31/2010

9/30/2011

     Annualized return on average assets

0.27%

0.61%

-55.7%

0.10%

170.0%

     Annualized return on average tangible common equity

3.34%

5.67%

-41.1%

1.13%

195.6%

     Average loans to average deposits

67.93%

74.45%

-8.8%

69.28%

-2.0%

     Taxable-equivalent net interest margin

4.60%

4.70%

-2.1%

4.57%

0.7%

     Leverage capital ratio

11.14%

14.00%

-20.4%

12.54%

-11.2%

CREDIT QUALITY

     Allowance for loan losses (ALL) as a % of total loans

0.97%

1.52%

-35.9%

1.09%

-10.6%

     Nonperforming assets to tangible equity + ALL

10.33%

15.37%

-32.8%

10.86%

-4.9%

     Nonperforming assets to total loans, other real estate

         and other repossessed assets

1.88%

3.59%

-47.7%

2.25%

-16.6%

     Annualized YTD net charge-offs to total loans

0.73%

0.72%

1.6%

0.92%

-20.5%

MIDSOUTH BANCORP, INC. and SUBSIDIARIES          

Condensed Consolidated Financial Information (unaudited)       

(in thousands)               

BALANCE SHEET

December 31,

December 31,

%

September 30,

June 30,

2011

2010

Change

2011

2011

Assets

Cash and cash equivalents

$                    83,303

$                    91,907

-9.4%

$                     97,802

$                     74,239

Securities available-for-sale

367,241

263,809

39.2%

325,736

322,272

Securities held-to-maturity

100,472

1,588

6227.0%

43,736

340

     Total investment securities

467,713

265,397

76.2%

369,472

322,612

Time deposits held in banks

710

5,164

-86.3%

-

-

Other investments

5,637

5,062

11.4%

5,057

5,060

Total loans

746,305

580,812

28.5%

673,426

587,412

Allowance for loan losses

(7,276)

(8,813)

-17.4%

(7,329)

(7,313)

     Loans, net

739,029

571,999

29.2%

666,097

580,099

Premises and equipment

44,598

36,592

21.9%

40,752

37,178

Goodwill and other intangibles

32,106

9,386

242.1%

19,708

9,345

Other assets

23,660

16,832

40.6%

23,063

20,572

     Total assets

$               1,396,756

$               1,002,339

39.3%

$                1,221,951

$                1,049,105

Liabilities and Shareholders' Equity

Non-interest bearing deposits

$                  254,755

$                  199,460

27.7%

$                   222,937

$                   217,706

Interest-bearing deposits

910,051

601,312

51.3%

766,073

608,190

   Total deposits

1,164,806

800,772

45.5%

989,010

825,896

Securities sold under agreements to

   repurchase and other short term

   borrowings

46,078

43,826

5.1%

55,078

45,963

Junior subordinated debentures

15,465

15,465

0.0%

15,465

15,465

Other liabilities

8,570

5,623

52.4%

9,031

22,651

     Total liabilities

1,234,919

865,686

42.7%

1,068,584

909,975

Total shareholders' equity

161,837

136,653

18.4%

153,367

139,130

    Total liabilities and shareholders' equity

$               1,396,756

$               1,002,339

39.3%

$                1,221,951

$                1,049,105

MIDSOUTH BANCORP, INC. and SUBSIDIARIES             

Condensed Consolidated Financial Information (unaudited)          

(in thousands except per share data)                

Three Months Ended

Year Ended

EARNINGS STATEMENT

December 31,

%

December 31,

%

2011

2010

Change

2011

2010

Change

Interest income

$           14,564

$           12,136

20.0%

$           51,007

$           48,124

6.0%

Interest expense

1,489

1,630

-8.7%

5,802

7,395

-21.5%

Net interest income

13,075

10,506

24.5%

45,205

40,729

11.0%

Provision for loan losses

775

870

-10.9%

3,925

5,020

-21.8%

Service charges on deposit accounts

1,855

2,188

-15.2%

6,921

9,673

-28.5%

Other charges and fees

1,565

1,268

23.4%

6,140

5,184

18.4%

Total non-interest income

3,420

3,456

-1.0%

13,061

14,857

-12.1%

Salaries and employee benefits

5,783

5,046

14.6%

21,763

20,352

6.9%

Occupancy expense

2,563

2,018

27.0%

9,281

8,727

6.3%

FDIC premiums

210

345

-39.1%

921

1,331

-30.8%

Other non-interest expense

5,613

3,389

65.6%

17,339

13,408

29.3%

Total non-interest expense

14,169

10,798

31.2%

49,304

43,818

12.5%

Earnings before income taxes

1,551

2,294

-32.4%

5,037

6,748

-25.4%

Income tax expense

272

438

-37.9%

564

968

-41.7%

Net earnings

1,279

1,856

-31.1%

4,473

5,780

-22.6%

Dividends on preferred stock

400

300

33.3%

1,802

1,198

50.4%

Net earnings available to common shareholders

$                879

$             1,556

-43.5%

$             2,671

$             4,582

-41.7%

Earnings per common share, diluted

$               0.09

$               0.16

-43.8%

$               0.27

$               0.47

-42.6%

MIDSOUTH BANCORP, INC. and SUBSIDIARIES          

Condensed Consolidated Financial Information (unaudited)          

(in thousands except per share data)               

EARNINGS STATEMENT

Fourth

Third

Second

First

Fourth

QUARTERLY TRENDS

Quarter

Quarter

Quarter

Quarter

Quarter

2011

2011

2011

2011

2010

Interest income

$      14,564

$      13,120

$        11,935

$        11,388

$        12,136

Interest expense

1,489

1,462

1,404

1,447

1,630

Net interest income

13,075

11,658

10,531

9,941

10,506

Provision for loan losses

775

650

900

1,600

870

Net interest income after provision for loan loss

12,300

11,008

9,631

8,341

9,636

Total non-interest income

3,420

3,398

3,213

3,030

3,456

Total non-interest expense

14,169

13,175

11,233

10,727

10,798

Earnings before income taxes

1,551

1,231

1,611

644

2,294

Income tax benefit (expense)

(272)

(131)

(258)

97

(438)

Net earnings

1,279

1,100

1,353

741

1,856

Dividends on preferred stock

400

804

299

299

300

Net earnings available to common shareholders

$           879

$           296

$          1,054

$             442

$          1,556

Earnings per common share, diluted

$          0.09

$          0.03

$            0.10

$            0.05

$            0.16

MIDSOUTH BANCORP, INC. and SUBSIDIARIES          

Condensed Consolidated Financial Information (unaudited)       

(in thousands)               

COMPOSITION OF LOANS

December 31,

December 31,

%

September 30,

June 30,

2011

2010

Change

2011

2011

Commercial, financial, and agricultural

$                  223,283

$                  177,598

25.7%

$                212,232

$                194,136

Lease financing receivable

4,276

4,748

-9.9%

4,472

4,660

Real estate - construction

52,712

54,164

-2.7%

60,055

46,608

Real estate - commercial

280,798

208,764

34.5%

262,984

213,007

Real estate - residential

113,582

72,460

56.8%

78,188

71,589

Installment loans to individuals

69,980

62,272

12.4%

54,779

56,768

Other

1,674

806

107.7%

716

644

Total loans

$                  746,305

$                  580,812

28.5%

$                673,426

$                587,412

COMPOSITION OF DEPOSITS

December 31,

December 31,

%

September 30,

June 30,

2011

2010

Change

2011

2011

Noninterest bearing

$                  254,755

$                  199,460

27.7%

$                222,937

$                217,706

NOW & Other

235,168

179,541

31.0%

207,096

184,072

Money Market/Savings

350,342

304,061

15.2%

313,768

309,138

Time Deposits of less than $100,000

140,428

58,587

139.7%

101,436

55,912

Time Deposits of $100,000 or more

184,113

59,123

211.4%

143,773

59,068

Total deposits

$               1,164,806

$                  800,772

45.5%

$                989,010

$                825,896

MIDSOUTH BANCORP, INC. and SUBSIDIARIES          

Condensed Consolidated Financial Information (unaudited)       

(in thousands)               

ASSET QUALITY DATA

December 31,

December 31,

%

September 30,

June 30,

2011

2010

Change

2011

2011

Nonaccrual loans

$                      6,229

$                    19,603

-68.2%

$                    7,939

$                 10,456

Loans past due 90 days and over

231

66

250.0%

87

69

Total nonperforming loans

6,460

19,669

-67.2%

8,026

10,525

Other real estate owned

7,369

1,206

511.0%

7,278

5,677

Other repossessed assets

326

36

805.6%

9

23

Total nonperforming assets

$                    14,155

$                    20,911

-32.3%

$                  15,313

$                 16,225

Troubled debt restructurings

$                         456

$                         653

-30.2%

$                       461

$                      463

Nonperforming assets to total assets

1.01%

2.09%

-51.7%

1.25%

1.55%

Nonperforming assets to total loans +      

ORE + other repossessed assets

1.88%

3.59%

-47.6%

2.25%

2.74%

ALL to nonperforming loans

112.63%

44.81%

151.4%

91.32%

69.48%

ALL to total loans

0.97%

1.52%

-36.2%

1.09%

1.24%

Year-to-date charge-offs

$                      5,772

$                      4,456

29.5%

$                    4,890

$                   4,208

Year-to-date recoveries

310

254

22.0%

256

208

Year-to-date net charge-offs

$                      5,462

$                      4,202

30.0%

$                    4,634

$                   4,000

Annualized YTD net charge-offs to total loans

0.73%

0.72%

1.6%

0.92%

1.37%

MIDSOUTH BANCORP, INC. and SUBSIDIARIES             

Condensed Consolidated Financial Information (unaudited)   

(in thousands)    

YIELD ANALYSIS

Three Months Ended

Three Months Ended  

December 31, 2011

December 31, 2010

Tax

Tax

Average

Equivalent

Yield/

Average

Equivalent

Yield/

Balance

Interest

Rate

Balance

Interest

Rate

Taxable securities

$            304,741

$            1,825

2.40%

$           156,994

$               883

2.25%

Tax-exempt securities

88,605

1,122

5.07%

106,292

1,351

5.08%

Total investment securities

393,346

2,947

3.00%

263,286

2,234

3.39%

Federal funds sold

11,933

6

0.20%

6,227

3

0.19%

Time and interest bearing deposits in

other banks

40,742

27

0.26%

57,396

60

0.41%

Other investments

5,250

38

2.90%

5,063

35

2.77%

Loans

703,590

11,872

6.69%

588,004

10,197

6.88%

Total interest earning assets

1,154,861

14,890

5.12%

919,976

12,529

5.40%

Non-interest earning assets

118,411

84,122

Total assets

$         1,273,272

$        1,004,098

Interest-bearing liabilities:

Deposits

$            801,743

$            1,038

0.51%

$           587,781

$            1,152

0.78%

Repurchase agreements

56,849

206

1.44%

53,863

235

1.73%

Junior subordinated debentures

15,465

245

6.20%

15,465

243

6.15%

Total interest-bearing liabilities

874,057

1,489

0.68%

657,109

1,630

0.98%

Non-interest bearing liabilities

243,303

209,302

Shareholders' equity

155,912

137,687

Total liabilities and  shareholders'

equity

$         1,273,272

$        1,004,098

Net interest income (TE) and spread

$          13,401

4.44%

$          10,899

4.42%

Net interest margin

4.60%

4.70%

MIDSOUTH BANCORP, INC. and SUBSIDIARIES             

Condensed Consolidated Financial Information (unaudited)   

(in thousands)    

YIELD ANALYSIS

Year Ended

Year Ended

December 31, 2011

December 31, 2010

Tax

Tax

Average

Equivalent

Yield/

Average

Equivalent

Yield/

Balance

Interest

Rate

Balance

Interest

Rate

Taxable securities

$            226,819

$              5,362

2.36%

$           153,545

$             3,699

2.41%

Tax-exempt securities

93,796

4,786

5.10%

109,020

5,598

5.13%

Total investment securities

320,615

10,148

3.17%

262,565

9,297

3.54%

Federal funds sold

6,567

14

0.21%

3,328

7

0.21%

Time and interest bearing deposits in

other banks

61,292

196

0.32%

41,999

274

0.64%

Other investments

5,107

155

3.04%

5,007

148

2.96%

Loans

624,889

41,887

6.70%

584,190

40,029

6.85%

Total interest earning assets

1,018,470

52,400

5.14%

897,089

49,755

5.55%

Non-interest earning assets

99,206

84,682

Total assets

$         1,117,676

$           981,771

Interest-bearing liabilities:

Deposits

$            680,551

$              4,024

0.59%

$           589,168

$             5,468

0.93%

Repurchase agreements

49,654

807

1.63%

49,054

948

1.93%

Federal funds purchased

-

-

-

243

2

0.81%

Other borrowings

-

-

-

682

3

0.44%

Junior subordinated debentures

15,465

971

6.19%

15,465

974

6.21%

Total interest-bearing liabilities

745,670

5,802

0.78%

654,612

7,395

1.13%

Non-interest bearing liabilities

228,036

190,876

Shareholders' equity

143,970

136,283

Total liabilities and  shareholders'

equity

$         1,117,676

$           981,771

Net interest income (TE) and spread

$            46,598

4.36%

$           42,360

4.42%

Net interest margin

4.58%

4.72%

MIDSOUTH BANCORP, INC. and SUBSIDIARIES             

Reconciliation of Non-GAAP Financial Measures

(in thousands except per share data)    

For the Quarter Ended

December 31,

December 31,

September 30,

Per Common Share Data

2011

2010

2011

Book value per common share

$                  12.41

$                  12.05

$                  12.47

Effect of intangible assets per share

3.07

0.96

2.02

Tangible book value per common share

$                    9.34

$                  11.09

$                  10.45

Earnings per share

$                    0.09

$                    0.16

$                    0.03

Effect of Merger-related costs, after-tax

0.08

-

0.06

Effect of accretion - repayment of TARP

-

-

0.05

 Operating Earnings per share

$                    0.17

$                    0.16

$                    0.14

Average Balance Sheet Data

Total equity

$              155,912

$              137,687

$              144,757

Preferred equity

32,000

19,386

24,541

Total common equity

$              123,912

$              118,301

$              120,216

Intangible assets

19,655

9,395

16,225

Tangible common equity

$              104,257

$              108,906

$              103,991

Certain financial information included in the earnings release and the associated Condensed Consolidated Financial Information (unaudited) is determined by methods other than in accordance with GAAP.  The non-GAAP financial measure above is calculated by using "tangible common equity," which is defined as total common equity reduced by intangible assets.  "Tangible book value per common share" is defined as tangible common equity divided by total common shares outstanding.  

We use non-GAAP measures because we believe they are useful for evaluating our financial condition and performance over periods of time, as well as in managing and evaluating our business and in discussions about our performance.  We also believe these non-GAAP financial measures provide users of our financial information with a meaningful measure for assessing our financial condition as well as comparison to financial results for prior periods.  These results should not be viewed as a substitute for results determined in accordance with GAAP, and are not necessarily comparable to non-GAAP performance measures that other companies may use.

SOURCE MidSouth Bancorp, Inc.



RELATED LINKS

http://www.midsouthbank.com