2014

MidSouth Bancorp, Inc. Reports Third Quarter 2013 Results - Diluted EPS $0.27 per common share versus $0.21 per common share for 3Q 2012

- Annualized net loan growth of 9.5% on linked quarter basis and 12.5% YTD

- Annualized net charge-offs for the quarter of 0.11%

- Core FTE NIM on linked quarter basis of 4.30% versus 4.33%

- SBLF dividend set at 1.00% starting 4Q 2013 through February 2016

LAFAYETTE, La., Oct. 29, 2013 /PRNewswire/ -- MidSouth Bancorp, Inc. ("MidSouth") (NYSE: MSL) today reported record quarterly net earnings available to common shareholders of $3.1 million for the third quarter of 2013, compared to net earnings available to common shareholders of $2.2 million reported for the third quarter of 2012 and $3.3 million in net earnings available to common shareholders for the second quarter of 2013.  Diluted earnings for the third quarter of 2013 were $0.27 per common share, compared to $0.21 per common share reported for the third quarter of 2012 and $0.29 per common share reported for the second quarter of 2013. 

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

Dividends paid on the Series B Preferred Stock issued to the Treasury as a result of our participation in the Small Business Lending Fund ("SBLF") totaled $368,000 for the third quarter of 2013 based on a dividend rate of 4.60%.  The dividend rate is set at 1.00% for the fourth quarter of 2013 due to attaining the target 10% growth rate in qualified small business loans during the second quarter of 2013.  The Series C Preferred Stock issued with the December 28, 2012 acquisition of PSB Financial Corporation ("PSB") paid dividends totaling $100,000 for the three months ended September 30, 2013. 

Balance Sheet

Total consolidated assets at September 30, 2013 were $1.9 billion, compared to $1.4 billion at September 30, 2012 and $1.9 billion at June 30, 2013.  Deposits totaled $1.5 billion at September 30, 2013, compared to $1.2 billion at September 30, 2012 and $1.5 billion at June 30, 2013.   Total deposits declined $29.7 million during the quarter due to fluctuations in demand deposit accounts, primarily public fund accounts and, to a lesser extent, acquired higher cost certificate of deposit accounts.  Net loans totaled $1.1 billion at September 30, 2013, compared to $801.5 million at September 30, 2012 and $1.1 billion at June 30, 2013.  Net loans grew $26.3 million in the third quarter and $96.8 million for the nine months ended September 30, 2013 at annualized growth rates of 9.5% and 12.5%, respectively.

MidSouth's Tier 1 leverage capital ratio was 9.17% at September 30, 2013 compared to 9.14% at June 30, 2013.  Tier 1 risk-based capital and total risk-based capital ratios were 13.13% and 13.84% at September 30, 2013, compared to 13.24% and 13.95% at June 30, 2013, respectively.  The Tier 1 common equity to total risk-weighted assets at September 30, 2013 was 7.56%.  Tangible common equity totaled $96.9 million at September 30, 2013, compared to $94.5 million at June 30, 2013.  Tangible book value per share at September 30, 2013 was $8.61 versus $8.39 at June 30, 2013.

Rusty Cloutier, President & CEO, commenting on third quarter earnings stated, "We invested significantly in marketing our brand throughout our footprint during the quarter to spur loan growth and continue the momentum of our successful SBLF campaign in the second quarter.  As a result, we grew loans $26 million this quarter.  However, our operating efficiencies are not meeting our expectations as we position the Bank to reap the benefits of recent investments in growth through acquisitions and branch expansions.  Over the next year, Jerry Reaux, Vice Chairman and COO, will lead our executive management team to analyze revenue and expenses, including our branch network structure, to accelerate improvements in profitability."

Asset Quality

Nonperforming assets declined 12.6% in year-over-year comparison and 1.7% in sequential quarter comparison as asset quality continued to improve.  Total nonperforming assets were reduced from $18.5 million at December 31, 2012 to $13.8 million at June 30, 2013 and to $13.6 million at September 30, 2013, primarily due to a $4.0 million reduction in nonperforming loans, including loans past due 90 days and over, during the first nine months of 2013.    

Allowance coverage for nonperforming loans increased to 126.29% at September 30, 2013 compared to 123.84% at June 30, 2013.  The ALL/total loans ratio was 0.76% at September 30, 2013, unchanged from June 30, 2013.  Including valuation accounting adjustments on acquired loans, the total valuation accounting adjustment plus ALL was 1.61% of loans at September 30, 2013.  The ratio of annualized net charge-offs to total loans was 0.11% for the three months ended September 30, 2013 compared to 0.06% for the three months ended June 30, 2013.

Total nonperforming assets to total loans plus ORE and other assets repossessed decreased to 1.18% at September 30, 2013 from 1.23% at June 30, 2013.  Loans classified as troubled debt restructurings ("TDRs") totaled $533,000 at September 30, 2013 compared to $535,000 at June 30, 2013.  Classified assets, including ORE, decreased to $34.5 million compared to $36.1 million at June 30, 2013.

Third Quarter 2013 vs. Third Quarter 2012 Earnings Comparison

Third quarter 2013 net earnings available to common shareholders totaled $3.1 million compared to $2.2 million for the third quarter of 2012.  Revenues from consolidated operations increased $6.4 million in quarterly comparison and included $1.2 million in purchase accounting adjustments on the 2012 and 2011 acquisitions.  Noninterest income increased $1.2 million in quarterly comparison, from $3.8 million for the three months ended September 30, 2012 to $5.0 million for the three months ended September 30, 2013.  Increases in noninterest income consisted primarily of $454,000 in service charges on deposit accounts and $596,000 in ATM/debit card income due to the acquired branches in the Timber Region. 

Noninterest expenses increased $4.9 million for the third quarter 2013 compared to third quarter 2012 and included approximately $1.7 million in operating expenses for the Timber Region and approximately $368,000 in operating costs for four new branches opened in late 2012 and early 2013.  The remaining $2.8 million of increased operating costs consisted primarily of $1.2 million in salaries and benefits costs, $464,000 in occupancy expense, $293,000 in ATM/debit card expense, $117,000 in marketing costs and $173,000 in data processing expenses.  The increased costs were partially offset by a $230,000 decrease in legal and professional fees.  The provision for loan losses increased $150,000 primarily as a result of the loan growth experienced during the third quarter of 2013.  Income tax expense increased $526,000 in quarterly comparison.

Fully taxable-equivalent ("FTE") net interest income totaled $19.5 million and $14.2 million for the quarters ended September 30, 2013 and 2012, respectively.  The FTE net interest income increased $5.3 million in prior year quarterly comparison primarily due to a $413.4 million increase in the volume of average earning assets primarily as a result of the PSB acquisition.  The average volume of loans increased $350.2 million in quarterly comparison and the average yield on loans decreased 22 basis points, from 6.46% to 6.24%.  Purchase accounting adjustments on acquired loans added 39 basis points to the average yield on loans for the third quarter of 2013 and 23 basis points to the average yield on loans for the third quarter of 2012.  Net of the impact of the purchase accounting adjustments, average loan yields declined 38 basis points in prior year quarterly comparison, from 6.23% to 5.85%.  Loan yields have declined primarily as the result of a sustained low market interest rate environment.

Investment securities totaled $517.8 million, or 27.8% of total assets at September 30, 2013, versus $458.8 million, or 32.1% of total assets at September 30, 2012.  The investment portfolio had an effective duration of 4.4 years and an unrealized gain of $2.1 million at September 30, 2013.  The average volume of investment securities increased $57.1 million in quarterly comparison primarily due to $152.7 million in securities acquired with the PSB acquisition at year end December 2012, of which $28.8 million were sold early in the first quarter of 2013.  The average tax equivalent yield on investment securities decreased 4 basis points, from 2.63% to 2.59%.  The average yield on all earning assets increased 7 basis points in prior year quarterly comparison, from 4.92% for the third quarter of 2012 to 4.99% for the third quarter of 2013.   Net of the impact of purchase accounting adjustments, the average yield on total earning assets declined 5 basis points, from 4.79% to 4.74% for the three month periods ended September 30, 2012 and 2013, respectively.

The impact to interest expense of a $335.8 million increase in the average volume of interest bearing liabilities was partially offset by an 11 basis point decrease in the average rate paid on interest bearing liabilities, from 0.62% at September 30, 2012 to 0.51% at September 30, 2013.  Net of purchase accounting adjustments on acquired certificates of deposit and FHLB borrowings, the average rate paid on interest bearing liabilities was 0.71% for the third quarter of 2012 and declined to 0.58% for the third quarter of 2013.

As a result of these changes in volume and yield on earning assets and interest bearing liabilities, the FTE net interest margin increased 14 basis points, from 4.46% for the third quarter of 2012 to 4.60% for the third quarter of 2013.  Net of purchase accounting adjustments on loans, deposits and FHLB borrowings, the FTE margin increased 4 basis points, from 4.26% for the third quarter of 2012 to 4.30% for the third quarter of 2013.

Third Quarter 2013 vs. Second Quarter 2013 Earnings Comparison

In sequential-quarter comparison, net earnings available to common shareholders decreased $199,000 as a $671,000 decrease in net interest income and a $214,000 increase in non-interest expenses were partially offset by an $800,000 decrease in provision for loan losses.  Net interest income decreased in sequential-quarter comparison primarily due to $842,000 in non-recurring interest income recorded in the second quarter of 2013.  This amount was comprised of additional discount accretion totaling $630,000 was earned from the PSB purchased credit impaired loan portfolio and $212,000 in interest income was recaptured on a nonperforming loan in June of 2013.

Noninterest expenses increased $214,000 and consisted primarily of increases of $271,000 in salaries and benefits costs, $196,000 in marketing expenses and $149,000 in occupancy expenses, which were partially offset by decreases of $216,000 in expenses on ORE and $230,000 in legal and professional fees.  

FTE net interest income decreased $593,000 in sequential quarter comparison primarily due to a reduction in purchase accounting adjustments resulting from the payoff of certain PSB purchased credit impaired loans.  The reduction in purchase accounting adjustments resulted in a decrease in the average yield on loans, from 6.76% for the second quarter of 2013 to 6.24% for the third quarter of 2013.  An average decrease of $19.3 million in investment securities and an average increase of $23.3 million in FHLB advances funded a $42.8 million increase in the average volume of loans.  The average yield on total earning assets decreased 27 basis points for the same period, from 5.26% to 4.99%, respectively.  An average decrease of $16.2 million in deposits was offset by an average increase of $16.6 million in overnight repurchase agreements.  As a result of these changes in volume and yield on earning assets and interest bearing liabilities, the FTE net interest margin decreased 27 basis points, from 4.87% to 4.60%.  Net of purchase accounting adjustments, the FTE net interest margin decreased 3 basis points, from 4.33% for the quarter ended June 30, 2013 to 4.30% for the quarter ended September 30, 2013.

Year-Over-Year Earnings Comparison

In year-over-year comparison, net earnings available to common shareholders increased $2.7 million primarily as a result of a $15.7 million improvement in net interest income and a $3.2 million increase in noninterest income which offset a $14.1 million increase in noninterest expense, a $700,000 increase in provision for loan loss and a $1.5 million increase in income tax expense.  The $15.7 million increase in net interest income included approximately $9.7 million earned from the Timber Region.  An increase in purchase accounting adjustments of $3.2 million in year-to-date comparison also contributed to the increase in net interest income. 

Increases in noninterest income consisted primarily of $1.2 million in service charges on deposit accounts and $1.3 million in ATM and debit card income.  Noninterest expenses increased $14.1 million in year-to-date comparison and included approximately $5.0 million in operating expenses for the Timber Region and approximately $1.2 million in operating expenses for the four new branches opened in late 2012 and early 2013.  Increases in noninterest expense, excluding operating expenses on the Timber Region and the new branches, included primarily $3.7 million in salary and benefits costs, $1.4 million in occupancy expense, $486,000 in ATM/debit card expense and $370,000 in corporate development expense.  The increase was offset by a $529,000 decrease in expenses on ORE and repossessed assets, excluding expenses on ORE and repossessed assets incurred by the Timber Region.

In year-to-date comparison, FTE net interest income increased $16.1 million primarily due to a $399.1 million increase in the average volume of earning assets that resulted in a $16.6 million increase in interest income.  The average yield on earning assets increased in year-to-date comparison, from 4.95% at September 30, 2012 to 5.11% at September 30, 2013.  Net of a 41 basis point effect of discount accretion on acquired loans, the average yield on earning assets was 4.70% at September 30, 2013.

Interest expense increased in year-over-year comparison primarily due to a $307.5 million increase in the average volume of interest-bearing liabilities, from $951.8 million at September 30, 2012 to $1.3 billion at September 30, 2013.  The average rate paid on interest-bearing liabilities decreased 10 basis points, from 0.63% at September 30, 2012 to 0.53% at September 30, 2013.  Net of a 9 basis point effect of premium amortization on acquired certificates of deposit and FHLB advances, the average rate paid on interest bearing liabilities was 0.62% at September 30, 2013.  The FTE net interest margin increased 23 basis points, from 4.48% for the nine months ended September 30, 2012 to 4.71% for the nine months ended September 30, 2013.  Net of purchase accounting adjustments, the FTE net interest margin increased 1 basis point, from 4.23% to 4.24% for the nine months ended September 30, 2012 and 2013, respectively.

About MidSouth Bancorp, Inc.

MidSouth Bancorp, Inc. is a financial holding company headquartered in Lafayette, Louisiana, with assets of $1.9 billion as of September 30, 2013. MidSouth Bancorp, Inc. trades on the NYSE under the symbol "MSL." 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 currently has 61 locations in Louisiana and Texas, including a Loan Production Office in Austin, Texas, and is connected to a worldwide ATM network that provides customers with access to more than 50,000 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, the expected impacts of the recently completed PSB acquisition, future expansion plans and future operating results.  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, the ability of MidSouth to integrate the PSB operations and capitalize on new market opportunities resulting from the acquisition; the effect of the PSB acquisition on relations with customers and employees; 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, 2012 filed with the SEC on March 18, 2013 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





September 30,


%


June 30,


%

EARNINGS DATA


2013


2012


Change


2013


Change

     Total interest income


$        20,704


$        15,355


34.8%


$        21,356


-3.1%

     Total interest expense


1,633


1,468


11.2%


1,614


1.2%

          Net interest income


19,071


13,887


37.3%


19,742


-3.4%

     FTE net interest income


19,486


14,187


37.4%


20,079


-3.0%

     Provision for loan losses


450


300


50.0%


1,250


-64.0%

     Non-interest income


4,988


3,754


32.9%


5,004


-0.3%

     Non-interest expense


18,481


13,630


35.6%


18,267


1.2%

          Earnings before income taxes


5,128


3,711


38.2%


5,229


-1.9%

     Income tax expense


1,588


1,062


49.5%


1,566


1.4%

          Net earnings


3,540


2,649


33.6%


3,663


-3.4%

     Dividends on preferred stock


468


400


17.0%


392


19.4%

          Net earnings available to common shareholders


$          3,072


$          2,249


36.6%


$          3,271


-6.1%












PER COMMON SHARE DATA











     Basic earnings per share


$            0.27


$            0.21


28.6%


$            0.29


-6.9%

     Diluted earnings per share


0.27


0.21


28.6%


0.29


-6.9%

     Quarterly dividends per share


0.08


0.07


14.3%


0.08


0.0%

     Book value at end of period


13.12


13.01


0.8%


12.92


1.5%

     Tangible book value at period end


8.61


10.01


-14.0%


8.39


2.6%

     Market price at end of period


15.50


16.19


-4.3%


15.53


-0.2%

     Shares outstanding at period end 


11,253,216


10,479,077


7.4%


11,253,216


0.0%

     Weighted average shares outstanding











        Basic


11,253,216


10,478,456


7.3%


11,238,945


0.0%

        Diluted


11,868,851


10,517,999


12.8%


11,838,862


0.3%












AVERAGE BALANCE SHEET DATA











     Total assets


$   1,863,090


$   1,398,355


33.2%


$   1,850,483


0.7%

     Loans and leases


1,123,086


772,838


45.3%


1,080,295


4.0%

     Total deposits


1,521,146


1,149,892


32.3%


1,538,320


-1.1%

     Total common equity


146,182


135,055


8.2%


150,287


-2.7%

     Total tangible common equity


95,363


103,577


-7.9%


98,996


-3.7%

     Total equity 


188,179


167,055


12.6%


192,284


-2.1%












SELECTED RATIOS


9/30/2013


9/30/2012




6/30/2013



     Annualized return on average assets


0.65%


0.64%


1.6%


0.71%


-8.5%

     Annualized return on average common equity


8.34%


6.62%


26.0%


8.73%


-4.5%

     Average loans to average deposits


73.83%


67.21%


9.9%


70.23%


5.1%

     Taxable-equivalent net interest margin


4.60%


4.46%


3.1%


4.87%


-5.5%

     Tier 1 leverage capital ratio


9.17%


10.53%


-12.9%


9.14%


0.3%












CREDIT QUALITY











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


0.76%


0.91%


-16.5%


0.76%


0.0%

     Nonperforming assets to tangible equity + ALLL


9.18%


10.74%


-14.5%


9.51%


-3.4%

     Nonperforming assets to total loans, other real estate

owned and other repossessed assets












1.18%


1.90%


-38.1%


1.23%


-4.0%

     Annualized QTD net charge-offs to total loans


0.11%


0.07%


58.9%


0.06%


74.3%

 

 

 

MIDSOUTH BANCORP, INC. and SUBSIDIARIES          

Condensed Consolidated Financial Information (unaudited)       

(in thousands)               



















BALANCE SHEET


September 30,


September 30,


%


June 30,


March 31,



2013


2012


Change


2013


2013

Assets











Cash and cash equivalents


$     43,434


$     59,655


-27.2%


$     59,578


$   118,009

Securities available-for-sale


358,675


341,170


5.1%


367,299


387,786

Securities held-to-maturity


159,141


117,628


35.3%


163,610


167,617

     Total investment securities


517,816


458,798


12.9%


530,909


555,403

Time deposits held in banks


-


709


-100.0%


-


0

Other investments


10,951


5,820


88.2%


10,951


10,017

Total loans


1,145,023


808,833


41.6%


1,118,572


1,037,859

Allowance for loan losses


(8,667)


(7,374)


17.5%


(8,531)


(7,457)

     Loans, net


1,136,356


801,459


41.8%


1,110,041


1,030,402

Premises and equipment


70,147


48,086


45.9%


67,881


66,797

Goodwill and other intangibles


50,703


31,391


61.5%


50,980


51,447

Other assets


33,400


23,018


45.1%


33,436


34,981

     Total assets


$1,862,807


$1,428,936


30.4%


$1,863,776


$1,867,056























Liabilities and Shareholders' Equity











Non-interest bearing deposits


$   380,048


$   306,463


24.0%


$   395,341


$   390,774

Interest-bearing deposits


1,126,078


872,549


29.1%


1,140,453


1,169,352

   Total deposits


1,506,126


1,179,012


27.7%


1,535,794


1,560,126

Securities sold under agreements to repurchase and other short term borrowings












77,809


55,233


40.9%


51,710


48,557

Short-term FHLB advances


25,000


-


100.0%


25,000


-

Other borrowings


28,059


0


100.0%


28,416


28,772

Junior subordinated debentures


29,384


15,465


90.0%


29,384


29,384

Other liabilities


6,800


10,891


-37.6%


6,039


9,384

     Total liabilities


1,673,178


1,260,601


32.7%


1,676,343


1,676,223

Total shareholders' equity


189,629


168,335


12.6%


187,433


190,833

     Total liabilities and shareholders' equity


$1,862,807


$1,428,936


30.4%


$1,863,776


$1,867,056

 

 

 

MIDSOUTH BANCORP, INC. and SUBSIDIARIES             

Condensed Consolidated Financial Information (unaudited)          

(in thousands except per share data)                
















Three Months Ended




Nine Months Ended



EARNINGS STATEMENT


September 30,


%


September 30,


%



2013


2012


Change


2013


2012


Change














Interest income


$20,704


$15,355


34.8%


$62,189


$45,986


35.2%

Interest expense


1,633


1,468


11.2%


4,964


4,486


10.7%

Net interest income


19,071


13,887


37.3%


57,225


41,500


37.9%

Provision for loan losses


450


300


50.0%


2,250


1,550


45.2%

Service charges on deposit accounts


2,352


1,898


23.9%


6,794


5,590


21.5%

Other charges and fees


2,636


1,856


42.0%


7,629


5,657


34.9%

Total non-interest income


4,988


3,754


32.9%


14,423


11,247


28.2%

Salaries and employee benefits


8,640


6,273


37.7%


25,401


18,511


37.2%

Occupancy expense


3,874


2,952


31.2%


11,196


8,283


35.2%

FDIC premiums


265


242


9.5%


854


695


22.9%

Other non-interest expense


5,702


4,163


37.0%


16,728


12,599


32.8%

Total non-interest expense


18,481


13,630


35.6%


54,179


40,088


35.2%

Earnings before income taxes


5,128


3,711


38.2%


15,219


11,109


37.0%

Income tax expense


1,588


1,062


49.5%


4,588


3,096


48.2%

Net earnings


3,540


2,649


33.6%


10,631


8,013


32.7%

Dividends on preferred stock


468


400


17.0%


1,152


1,180


-2.4%

Net earnings available to common shareholders


$  3,072


$  2,249


36.6%


$  9,479


$  6,833


38.7%



























Earnings per common share, diluted


$    0.27


$    0.21


28.6%


$    0.83


$    0.65


27.7%

 

 

 

MIDSOUTH BANCORP, INC. and SUBSIDIARIES          

Condensed Consolidated Financial Information (unaudited)          

(in thousands except per share data)               












EARNINGS STATEMENT


Third


Second


First


Fourth


Third

QUARTERLY TRENDS


Quarter


Quarter


Quarter


Quarter


Quarter



2013


2013


2013


2012


2012

Interest income


$20,704


$21,356


$20,129


$15,036


$15,355

Interest expense


1,633


1,614


1,717


1,354


1,468

Net interest income


19,071


19,742


18,412


13,682


13,887

Provision for loan losses


450


1,250


550


500


300

Net interest income after provision for loan loss


18,621


18,492


17,862


13,182


13,587

Total non-interest income


4,988


5,004


4,431


3,697


3,754

Total non-interest expense


18,481


18,267


17,431


14,567


13,630

Earnings before income taxes


5,128


5,229


4,862


2,312


3,711

Income tax expense


1,588


1,566


1,434


683


1,062

Net earnings


3,540


3,663


3,428


1,629


2,649

Dividends on preferred stock


468


392


292


367


400

Net earnings available to common shareholders


$  3,072


$  3,271


$  3,136


$  1,262


$  2,249












Earnings per common share, diluted


$    0.27


$    0.29


$    0.27


$    0.12


$    0.21

 

 

 

MIDSOUTH BANCORP, INC. and SUBSIDIARIES          

Condensed Consolidated Financial Information (unaudited)       

(in thousands)               




COMPOSITION OF LOANS


September 30,


September 30,


%


June 30,


March 31, 



2013


2012


Change


2013


2013














Commercial, financial, and agricultural


$       423,073


$       266,046


59.0%


$   391,241


$   315,397


Lease financing receivable


5,340


5,041


5.9%


5,656


4,962


Real estate - construction


76,213


57,727


32.0%


82,851


82,508


Real estate - commercial


401,080


293,579


36.6%


404,543


405,705


Real estate - residential


142,431


110,735


28.6%


141,689


138,284


Installment loans to individuals


94,722


73,334


29.2%


90,571


88,898


Other


2,164


2,371


-8.7%


2,021


2,105














Total loans


$    1,145,023


$       808,833


41.6%


$1,118,572


$1,037,859


































COMPOSITION OF DEPOSITS


September 30,


September 30,


%


June 30,


March 31,



2013


2012


Change


2013


2013














Noninterest bearing


$       380,048


$       306,463


24.0%


$   395,341


$   390,774


NOW & Other


412,873


239,937


72.1%


431,596


432,540


Money Market/Savings


463,621


377,405


22.8%


453,729


465,954


Time Deposits of less than $100,000


116,118


111,356


4.3%


119,299


125,020


Time Deposits of $100,000 or more


133,466


143,851


-7.2%


135,829


145,838














Total deposits


$    1,506,126


$    1,179,012


27.7%


$1,535,794


$1,560,126


 

 

 

MIDSOUTH BANCORP, INC. and SUBSIDIARIES          

Condensed Consolidated Financial Information (unaudited)       

(in thousands)               








ASSET QUALITY DATA


September 30,


September 30,


%


June 30,


March 31,


2013


2012


Change


2013


2013












Nonaccrual loans


$  6,119


$  8,307


-26.3%


$  6,772


$  7,526

Loans past due 90 days and over


744


532


39.8%


117


163

Total nonperforming loans


6,863


8,839


-22.4%


6,889


7,689

Other real estate owned


6,672


6,608


1.0%


6,900


7,552

Other repossessed assets


18


51


-64.7%


0


16

Total nonperforming assets


$13,553


$15,498


-12.6%


$13,789


$15,257












Troubled debt restructurings


$     533


$     242


120.2%


$     535


$  5,032























Nonperforming assets to total assets


0.73%


1.08%


-32.4%


0.74%


0.82%

Nonperforming assets to total loans + OREO + other repossessed assets


1.18%


1.90%


-37.9%


1.23%


1.46%

ALLL to nonperforming loans


126.29%


83.43%


51.4%


123.84%


96.98%

ALLL to total loans


0.76%


0.91%


-16.5%


0.76%


0.72%












Quarter-to-date charge-offs


$     375


$     234


60.3%


$     267


$     523

Quarter-to-date recoveries


61


86


-29.1%


91


60

Quarter-to-date net charge-offs


$     314


$     148


112.2%


$     176


$     463

Annualized QTD net charge-offs to total loans


0.11%


0.07%


58.9%


0.06%


0.18%

 

 

 

MIDSOUTH BANCORP, INC. and SUBSIDIARIES             

Condensed Consolidated Financial Information (unaudited)   

(in thousands)    






YIELD ANALYSIS


Three Months Ended


Three Months Ended  


September 30, 2013


September 30, 2012














Tax






Tax





Average


Equivalent


Yield/


Average


Equivalent


Yield/



Balance


Interest


Rate


Balance


Interest


Rate














Taxable securities


$   418,964


$   2,171


2.07%


$   384,958


$   2,048


2.13%

Tax-exempt securities


101,226


1,200


4.74%


78,115


997


5.11%

  Total investment securities


520,190


3,371


2.59%


463,073


3,045


2.63%

Federal funds sold


2,180


1


0.18%


3,570


2


0.22%

Time and interest bearing deposits in

other banks














22,519


15


0.26%


20,253


13


0.25%

Other investments


10,948


80


2.92%


5,816


55


3.78%

Loans (1)


1,123,086


17,652


6.24%


772,838


12,540


6.46%

  Total interest earning assets


1,678,923


21,119


4.99%


1,265,550


15,655


4.92%

Non-interest earning assets


184,167






132,805





  Total assets


$1,863,090






$1,398,355


















Interest-bearing liabilities:













Deposits (2)


$1,133,126


$      976


0.34%


$   873,128


$   1,030


0.47%

Repurchase agreements


64,274


204


1.26%


55,953


197


1.40%

Federal funds purchased


354


-


0.00%


64


-


-

Other borrowings (3)


51,853


104


0.78%


-


-


-

Notes Payable


1,448


14


3.78%


-


-


-

Junior subordinated debentures


29,384


335


4.46%


15,465


241


6.10%

  Total interest-bearing liabilities


1,280,439


1,633


0.51%


944,610


1,468


0.62%

Non-interest bearing liabilities


394,472






286,690





Shareholders' equity


188,179






167,055





  Total liabilities and  shareholders'

equity














$1,863,090






$1,398,355


















Net interest income (TE) and spread


$ 19,486


4.48%




$ 14,187


4.30%














Net interest margin




4.60%






4.46%



(1)

Includes $945,000 and $388,000 of interest income from accretable yield on purchased loans from acquisitions for the three months ended September 30, 2013 and 2012, respectively.

(2)

Includes $138,000 and $213,000 of reduction in interest expense from premium amortization on time deposits acquired from acquisitions for the three months ended September 30, 2013 and 2012, respectively.

(3)

Includes $92,000 of reduction in interest expense from premium amortization on FHLB borrowings acquired from PSB for the three months ended September 30, 2013.

 

 

 

MIDSOUTH BANCORP, INC. and SUBSIDIARIES             

Condensed Consolidated Financial Information (unaudited)   

(in thousands)    






YIELD ANALYSIS


Nine Months Ended


Nine Months Ended


September 30, 2013


September 30, 2012














Tax






Tax





Average


Equivalent


Yield/


Average


Equivalent


Yield/



Balance


Interest


Rate


Balance


Interest


Rate














Taxable securities


$   426,544


$  6,481


2.03%


$   380,154


$  6,265


2.20%

Tax-exempt securities


104,297


3,763


4.81%


81,774


3,152


5.14%

  Total investment securities


530,841


10,244


2.57%


461,928


9,417


2.72%

Federal funds sold


3,910


6


0.20%


3,657


6


0.22%

Time and interest bearing deposits in

other banks














34,435


70


0.27%


36,720


73


0.26%

Other investments


10,113


230


3.03%


5,737


142


3.30%

Loans (1)


1,082,679


52,966


6.54%


754,838


37,298


6.58%

  Total interest earning assets


1,661,978


63,516


5.11%


1,262,880


46,936


4.95%

Non-interest earning assets


191,964






132,169





  Total assets


$1,853,942






$1,395,049


















Interest-bearing liabilities:













Deposits (2)


$1,138,506


$  3,044


0.36%


$   886,033


$  3,189


0.48%

Repurchase agreements


52,597


565


1.44%


50,313


564


1.49%

Federal funds purchased


607


3


0.65%


22


-


-

Other borrowings (3)


36,587


302


1.09%


1


-


-

Notes payable


1,660


43


3.42%


-


-



Junior subordinated debentures


29,384


1,007


4.52%


15,465


733


6.23%

  Total interest-bearing liabilities


1,259,341


4,964


0.53%


951,834


4,486


0.63%

Non-interest bearing liabilities


404,267






278,042





Shareholders' equity


190,334






165,173





  Total liabilities and  shareholders'













equity


$1,853,942






$1,395,049


















Net interest income (TE) and spread


$58,552


4.58%




$42,450


4.32%














Net interest margin




4.71%






4.48%



(1)

Includes $4.6 million and $1.4 million of interest income from accretable yield on purchased loans from acquisitions for the nine months ended September 30, 2013 and 2012, respectively.

(2)

Includes $546,000 and $857,000 of reduction in interest expense from premium amortization on time deposits acquired from acquisitions for the nine months ended September 30, 2013 and 2012, respectively

(3)

Includes $276,000 of reduction in interest expense from premium amortization on FHLB borrowings acquired from PSB for the nine months ended September 30, 2013.

 

 

 

MIDSOUTH BANCORP, INC. and SUBSIDIARIES

Reconciliation of Non-GAAP Financial Measures (unaudited)

(in thousands except per share data)    










For the Quarter Ended



September 30,


September 30,


June 30,

Per Common Share Data


2013


2012


2013








Book value per common share


$     13.12


$     13.01


$     12.92

Effect of intangible assets per share


4.51


3.00


4.53

Tangible book value per common share


$       8.61


$     10.01


$       8.39








Diluted earnings per share


$       0.27


$       0.21


$       0.29

Effect of merger-related costs, after-tax


-


0.02


-

Operating earnings per share


$       0.27


$       0.23


$       0.29








Average Balance Sheet Data














Total equity


$ 188,179


$ 167,055


$ 192,284

Less preferred equity


41,997


32,000


41,997

Total common equity


$ 146,182


$ 135,055


$ 150,287

Less intangible assets


50,819


31,478


51,291

Tangible common equity


$   95,363


$ 103,577


$   98,996


     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.



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