Cadence Bank Announces Fourth Quarter 2021 and Annual Financial Results; Announces Increase in Quarterly Common Dividend

TUPELO, Miss. and HOUSTON, Jan. 25, 2022 /PRNewswire/ -- Cadence Bank (NYSE: CADE) (the Company), formerly known as BancorpSouth Bank, today announced financial results for the quarter and year ended December 31, 2021.

Annual highlights for 2021 included:

• Achieved net income available to common shareholders of $185.7 million, or $1.54 per diluted common share, and adjusted net income available to common shareholders – excluding mortgage servicing rights ("MSR") – of $340.9 million, or $2.83 per diluted common share.
• Completed merger with legacy Cadence Bancorporation, the parent company of Cadence Bank N.A., which closed effective October 29, 2021, and created an approximately $48 billion institution that is the 6^th largest bank headquartered in the Company's nine-state footprint.
• Changed name from "BancorpSouth Bank" to "Cadence Bank" and changed stock ticker symbol from "BXS" to "CADE" effective October 29, 2021, in conjunction with the Cadence merger.
• Completed two mergers with National United Bancshares, Inc., the parent company of National United, and FNS Bancshares, Inc., the parent company of FNB Bank, each effective May 1, 2021, which added approximately $1.6 billion in total assets to the Company.
• Continued strong credit quality metrics; reported net recoveries for the year of $5.3 million, or 0.03 percent of average loans and leases, while total non-performing loan and leases declined to 0.57 percent of net loans and leases.
• Reported record annual adjusted pre-tax pre-provision net revenue ("PPNR") of $442.8 million, or 1.48 percent of average assets; represents an increase of 10.6 percent from $400.5 million, or 1.76 percent of average assets, for 2020.
• Repurchased 6,000,000 shares of outstanding common stock at a weighted average price of $30.09 per share.

Highlights for the fourth quarter of 2021 included:

• Reported quarterly net loss available to common shareholders of $37.0 million, or $0.22 per diluted common share, and adjusted net income available to common shareholders – excluding MSR – of $102.1 million, or $0.62 per diluted common share.
• Generated $133.8 million in adjusted PPNR, or 1.29 percent of average assets on an annualized basis.
• Combined company generated net organic loan growth of approximately $400 million for the quarter, or 6 percent on an annualized basis.
• Recorded initial provisional purchase accounting adjustments related to the legacy Cadence merger including goodwill of $451.7 million and day one provision for credit losses of $132.1 million; reported merger and incremental merger-related expenses of approximately $49.5 million for the fourth quarter.
• Repurchased 4,257,526 shares of outstanding common stock at a weighted average price of $30.66 per share.

"The closing of our merger with legacy Cadence Bancorporation certainly highlights the completion of another successful year for our Company," remarked Dan Rollins, Chairman and Chief Executive Officer of the Company.  "We are very pleased to have been able to complete this transaction prior to the end of the year, particularly in light of the current regulatory environment.  Our operational integration teams are working diligently toward our core system conversion later in 2022.  While elevated merger expenses and other purchase accounting related items negatively impacted our earnings, we continue to be pleased with our core operating performance.  Credit quality is certainly a positive story.  We reported a meaningful decline in our non performing asset levels relative to the size of the balance sheet and also had net recoveries of $5.3 million for the year." 

Rollins continued, "From a capital management perspective, we completed the repurchase of the full 6 million shares authorized under the 2021 share repurchase program and our board recently approved an additional 10 million common stock share repurchase authorization for 2022.  We also completed our provisional purchase accounting marks during the fourth quarter of 2021.  The improvement in the loan mark relative to our initial estimate at announcement further validates the economic stability as well as the legacy Cadence team's efforts in working through any potential problem credits."

Paul Murphy, Executive Vice Chairman, added "As we look specifically at our fourth quarter performance, the ability of our relationship managers to produce approximately $400 million in net organic loan growth in the same quarter as the merger closing is a noteworthy accomplishment.   This success is a testament to the efforts of both our front-line teammates as well as our credit administration and other support functions, and is also reflective of the positive economic momentum across our footprint."

At its regular quarterly meeting today, the Board of Directors of the Company declared quarterly cash dividends of $0.22 per common share of stock and $0.34375 per share of Series A Preferred Stock.  The common stock dividend represents an increase of $0.02, or 10.0 percent, per share compared to the previous quarterly dividend of $0.20 per common share and is payable on April 1, 2022 to shareholders of record at the close of business on March 15, 2022.  The preferred stock dividend is payable on February 22, 2022 to shareholders of record at the close of business on February 4, 2022.

Earnings Summary

The Company reported net income available to common shareholders of $185.7 million, or $1.54 per diluted common share, for the year ended December 31, 2021 compared with $218.6 million, or $2.12 per diluted common share, for the year ended December 31, 2020.  The Company reported adjusted net income available to common shareholders – excluding MSR – of $340.9 million, or $2.83 per diluted common share, for the year ended December 31, 2021 compared with $237.3 million, or $2.30 per diluted common share, for the year ended December 31, 2020.  Given the merger date of October 29, 2021, the fourth quarter results do not represent a full quarter of comparable combined earnings.  Additionally, the increases in the balance sheet and income statement during the quarter are largely attributable to the merger.

Additionally, due to the acquired portfolio day one loan provision of $132.1 million upon merger, the Company reported a net loss available to common shareholders of $37.0 million, or $0.22 per diluted common share, for the fourth quarter of 2021, compared with net income available to common shareholders of $66.4 million, or $0.65 per diluted common share, for the fourth quarter of 2020 and net income available to common shareholders of $70.4 million, or $0.65 per diluted common share, for the third quarter of 2021.  The Company reported adjusted net income available to common shareholders – excluding MSR – of $102.1 million, or $0.62 per diluted common share, for the fourth quarter of 2021, compared with $70.8 million, or $0.69 per diluted common share, for the fourth quarter of 2020 and $73.3 million, or $0.68 per diluted common share, for the third quarter of 2021.

The Company reported adjusted PPNR of $442.8 million, or 1.48 percent of average assets, for the year ended December 31, 2021 compared with $400.5 million, or 1.76 percent of average assets, for the year ended December 31, 2020.  Additionally, the Company reported adjusted PPNR of $133.8 million, or 1.29 percent of average assets on an annualized basis, for the fourth quarter of 2021 compared to $94.4 million, or 1.59 percent of average assets on an annualized basis, for the fourth quarter of 2020 and $90.1 million, or 1.29 percent of average assets on an annualized basis, for the third quarter of 2021.

Net Interest Revenue

Net interest revenue was $271.2 million for the fourth quarter of 2021, compared to $176.9 million for the fourth quarter of 2020 and $181.5 million for the third quarter of 2021.  The fully taxable equivalent net interest margin was 2.90 percent for the fourth quarter of 2021, compared with 3.29 percent for the fourth quarter of 2020 and 2.86 percent for the third quarter of 2021.  Yields on net loans, loans held for sale, and leases were 4.34 percent for the fourth quarter of 2021, compared with 4.55 percent for the fourth quarter of 2020 and 4.46 percent for the third quarter of 2021, while yields on total interest earning assets were 3.11 percent for the fourth quarter of 2021, compared with 3.70 percent for the fourth quarter of 2020 and 3.15 percent for the third quarter of 2021.  The average cost of deposits was 0.17 percent for the fourth quarter of 2021, compared with 0.38 percent for the fourth quarter of 2020 and 0.24 percent for the third quarter of 2021. 

Net interest income for the fourth quarter of 2021 included $16.4 million in accretion income related to acquired loans and leases.  This accretion income added approximately 19 basis points to the net interest margin and 28 basis points to the yield on loans and leases for the fourth quarter of 2021.  This compares to net accretion income of $2.3 million for the fourth quarter of 2020 and net accretion income of $3.2 million for the third quarter of 2021.

Balance Sheet Activity

Loans and leases, net of unearned income, increased $11.9 billion to $26.9 billion during the fourth quarter of 2021 while deposits and customer repos increased $16.3 billion to $40.5 billion.  Legacy Cadence loans and leases, net of unearned income, totaled $11.5 billion at October 29, 2021 while deposits and customer repos totaled $16.4 billion.  On December 3, 2021, the company completed the previously announced divestiture of seven bank branches with approximately $40 million in loans and approximately $417 million in deposits.  Excluding the impact of acquired and divested balances, net organic loan growth for the combined company for the fourth quarter totaled approximately $400 million, or 6 percent annualized, while deposit and customer repo balances declined approximately $470 million on an organic basis.  The decline in deposit account balances in the fourth quarter was driven primarily by routine volatility in large municipal deposit accounts. 

Provision for Credit Losses and Allowance for Credit Losses

Earnings for the fourth quarter of 2021 reflected a provision for credit losses of $133.6 million, compared with $5.8 million for the fourth quarter of 2020 and a negative provision for credit losses of $7.0 million for the third quarter of 2021.  The provision for the fourth quarter of 2021 includes $132.1 million associated with day one accounting provision required for loans and unfunded commitments acquired during the quarter from the Cadence merger.  Net recoveries for the fourth quarter of 2021 were $4.8 million, or 0.08 percent of net loans and leases on an annualized basis, compared with net charge-offs of $11.2 million for the fourth quarter of 2020 and net recoveries of $2.1 million for the third quarter of 2021.  The allowance for credit losses was $446.4 million, or 1.66 percent of net loans and leases, at December 31, 2021, compared with $244.4 million, or 1.63 percent of net loans and leases, at December 31, 2020, and $260.3 million, or 1.74 percent of net loans and leases, at September 30, 2021. 

Total non-performing assets were $186.8 million, or 0.39 percent of total assets, at December 31, 2021, compared with $132.6 million, or 0.55 percent of total assets, at December 31, 2020, and $100.3 million, or 0.36 percent of total assets, at September 30, 2021.  Other real estate owned and other repossessed assets was $33.0 million at December 31, 2021, compared with $11.4 million at December 31, 2020 and $16.5 million at September 30, 2021.

Noninterest Revenue

Noninterest revenue was $103.9 million for the fourth quarter of 2021, compared with $78.8 million for the fourth quarter of 2020 and $84.4 million for the third quarter of 2021.  These results include a positive mortgage servicing rights (MSR) valuation adjustment of $2.6 million for the fourth quarter of 2021, compared with a positive MSR valuation adjustment of $0.2 million for the fourth quarter of 2020 and a positive MSR valuation adjustment of $2.0 million for the third quarter of 2021.  Valuation adjustments in the MSR asset are driven primarily by fluctuations in interest rates period over period.

Insurance commission revenue was $32.6 million for the fourth quarter of 2021, compared with $29.8 million for the fourth quarter of 2020 and $35.8 million for the third quarter of 2021.  While fourth quarter commission revenue is adversely impacted by policy renewal seasonality, commission revenue continues to benefit from a firm premium rate market.   Mortgage production and servicing revenue was $8.0 million for the fourth quarter of 2021, compared with $19.9 million for the fourth quarter of 2020 and $11.0 million for the third quarter of 2021.  Mortgage origination volume for the fourth quarter of 2021 was $817.7 million, compared with $845.9 million for the fourth quarter of 2020 and $788.9 million for the third quarter of 2021.  Mortgage revenue for the fourth quarter of 2021 was adversely impacted by seasonality in the mortgage pipeline as well as declines in refinance activity associated with rising interest rates.  Wealth management revenue was $16.4 million for the fourth quarter of 2021, compared with $6.8 million for the fourth quarter of 2020 and $7.1 million for the third quarter of 2021.  Wealth management revenue for the fourth quarter of 2021 includes additional revenue associated with legacy Cadence trust services and Linscomb & Williams.    

Credit card, debit card and merchant fee revenue was $12.8 million for the fourth quarter of 2021, compared with $10.1 million for the fourth quarter of 2020 and $11.4 million for the third quarter of 2021.  Deposit service charge revenue was $16.3 million for the fourth quarter of 2021, compared with $9.7 million for the fourth quarter of 2020 and $10.3 million for the third quarter of 2021.  Other noninterest revenue was $15.5 million for the fourth quarter of 2021, compared with $2.3 million for the fourth quarter of 2020 and $6.9 million for the third quarter of 2021.

Noninterest Expense

Noninterest expense for the fourth quarter of 2021 was $289.2 million, compared with $167.1 million for the fourth quarter of 2020 and $179.9 million for the third quarter of 2021.  Salaries and employee benefits expense was $149.6 million for the fourth quarter of 2021, compared with $97.2 million for the fourth quarter of 2020 and $113.0 million for the third quarter of 2021.  Occupancy and equipment expense was $26.9 million for the fourth quarter of 2021, compared with $17.8 million for the fourth quarter of 2020 and $19.0 million for the third quarter of 2021.  Data processing and software expense was $24.8 million for the fourth quarter of 2021, compared with $15.3 million for the fourth quarter of 2020 and $16.8 million for the third quarter of 2021.  Other noninterest expense was $39.1 million for the fourth quarter of 2021, compared with $29.1 million for the fourth quarter of 2020 and $23.0 million for the third quarter of 2021. 

Adjusted noninterest expense for the fourth quarter of 2021 was $239.1 million, compared with $161.1 million for the fourth quarter of 2020 and $174.0 million for the third quarter of 2021.  Adjusted noninterest expense excludes merger expense included as a separate line item on the income statement as well as incremental merger related expenses that are included in the respective expense categories.  Merger expenses represent costs to complete the merger with no future benefit, while incremental merger related expenses represent costs to complete the merger for which the entity receives a future benefit.  Merger expense was $44.8 million for the fourth quarter of 2021, compared with $0.2 million for the fourth quarter of 2020 and $3.4 million for the third quarter of 2021.  Merger expense for the fourth quarter of 2021 was comprised primarily of advisor fees, legal fees, and compensation related items.  Incremental merger related expenses for the fourth quarter of 2021 totaled $4.6 million that included primarily employee retention expense.  Adjusted noninterest expense for the fourth quarter of 2021 also excluded a charge of $0.7 million in accordance with ASC 715 "Compensation – Retirement Benefits" to reflect the settlement accounting impact of elevated lump sum retirement pension payouts in 2021.  Similar charges were recorded for the fourth quarter of 2020 and third quarter of 2021 of $5.8 million and $2.4 million, respectively. 

Capital Management

The Company's ratio of shareholders' equity to assets was 11.01 percent at December 31, 2021, compared with 11.72 percent at December 31, 2020 and 10.77 percent at September 30, 2021.  The ratio of tangible common shareholders' equity to tangible assets was 7.54 percent at December 31, 2021, compared with 7.54 percent at December 31, 2020 and 6.82 percent at September 30, 2021. 

During the fourth quarter of 2021, the Company repurchased 4,257,526 shares of its common stock at a weighted average price of $30.66 pursuant to its share repurchase program, which completed the repurchase of the full 6 million shares authorized under the program for 2021.   On December 8, 2021, the Company announced a new share repurchase program, pursuant to which the Board of Directors has authorized the repurchase of up to an aggregate of 10 million shares of Company common stock, which commenced January 3, 2022 and will expire December 30, 2022.

Estimated regulatory capital ratios at December 31, 2021 included Common Equity Tier 1 capital of 10.81 percent, Tier 1 capital of 11.29 percent, Total risk-based capital of 13.44 percent, and Tier 1 leverage capital of 9.90 percent. 

Summary

Rollins added, "As we move into the New Year, excitement and optimism among our teammates is at an all-time high. Today's public unveiling of our new logo is a significant milestone on our journey of creating the new Cadence Bank.  Our new visual identity mirrors the strategic union of our companies and reflects how we are working together to best serve our customers and communities, delivering a comprehensive and balanced set of financial solutions.  This new logo is the first component of our new brand, and we'll be unveiling other parts of our entire brand identity in the coming months.  For now, we can look to this new logo as another way for us to unite together in our shared commitment to the new Cadence Bank." 

Rollins concluded, "Our bankers are calling on customers and winning new business, which is clearly reflected in our fourth quarter organic growth totals.  Our insurance team had a record year in 2021 as they continue to capitalize on a firm insurance premium market.  Other teams, including mortgage, wealth management, and treasury management, are working diligently to grow revenue and take advantage of cross selling opportunities created by a much larger combined customer base.  Our back office and operational support teams continue to focus on the integration process as well as helping identify and realize the cost savings associated with the transaction.  Our board and management team are excited about the future of the new Cadence Bank and committed to continuing to drive improved operating performance and shareholder value."

MERGER TRANSACTIONS

Cadence Bancorporation (NYSE: CADE)

On October 29, 2021, the Company completed the merger with Cadence Bancorporation, the parent company of Cadence Bank N.A., (collectively referred to as legacy Cadence), pursuant to which legacy Cadence was merged with and into the Company (the Cadence Merger).  Legacy Cadence operated 99 full-service banking offices in the southeast.  As of October 29, 2021, legacy Cadence reported total assets of $18.8 billion, total loans of $11.6 billion and total deposits of $16.3 billion.  Under the terms of the definitive merger agreement, each legacy Cadence shareholder received 0.70 shares of the Company's common stock in exchange for each share of Cadence common stock they held.  In addition, legacy Cadence paid a one-time special dividend of $1.25 per share on October 28, 2021.  In connection with the closing, the Company changed its name from "BancorpSouth Bank" to "Cadence Bank" and also changed its NYSE ticker symbol from "BXS" to "CADE".  For more information regarding the Cadence Merger, see our Current Report on Form 8-K that was filed with the Federal Deposit Insurance Corporation (FDIC) on October 29, 2021.  The purchase accounting for this transaction is considered provisional as management continues to identify and assess information regarding the nature of the acquired assets and liabilities and reviews the associated valuation assumptions and methodologies.

FNS Bancshares, Inc.

On May 1, 2021, the Company completed the merger with FNS Bancshares, Inc., the parent company of FNB Bank, (collectively referred to as FNS), pursuant to which FNS was merged with and into the Company.  FNS operated 17 full-service banking offices in Alabama, Georgia and Tennessee.  The merger expanded the Company's presence in Jackson, DeKalb and Marshall counties in Alabama and the Chattanooga, Tennessee-Georgia and Nashville-Davidson-Murfreesboro-Franklin, Tennessee metropolitan statistical areas.  As of May 1, 2021, FNS reported total assets of $826.6 million, total loans of $464.7 million and total deposits of $720.7 million.  Under the terms of the definitive merger agreement, the Company issued approximately 2,975,000 shares of the Company's common stock plus $18.0 million in cash for all outstanding shares of FNS.  For more information regarding this transaction, see our Current Report on Form 8-K that was filed with the FDIC on May 3, 2021.  The purchase accounting for this transaction is considered provisional as management continues to identify and assess information regarding the nature of the acquired assets and liabilities and reviews the associated valuation assumptions and methodologies.

National United Bancshares, Inc.

On May 1, 2021, the Company completed the merger with National United Bancshares, Inc., the parent company of National United, (collectively referred to as National United), pursuant to which National United was merged with and into the Company.  National United operated 6 full-service banking offices in the Killeen-Temple, Texas; Waco, Texas; and Austin-Round Rock-Georgetown, Texas metropolitan statistical areas.  As of May 1, 2021, National United reported total assets of $817.3 million, total loans of $434.6 million and total deposits of $742.9 million.  Under the terms of the definitive merger agreement, the Company issued approximately 3,110,000 shares of the Company's common stock plus $33.25 million in cash for all outstanding shares of National United.  For more information regarding this transaction, see our Current Report on Form 8-K that was filed with the FDIC on May 3, 2021.  The purchase accounting for this transaction is considered provisional as management continues to identify and assess information regarding the nature of the acquired assets and liabilities and reviews the associated valuation assumptions and methodologies.

Non-GAAP Measures and Ratios

This news release presents certain financial measures and ratios that are not calculated in accordance with U.S. generally accepted accounting principles (GAAP).  A discussion regarding these non-GAAP measures and ratios, including reconciliations of non-GAAP measures to the most directly comparable GAAP measures and definitions for non-GAAP ratios, appears under the caption "Reconciliation of Non-GAAP Measures and Other Non-GAAP Ratio Definitions"  beginning on page 25 of this news release.

Conference Call and Webcast

The Company will conduct a conference call to discuss its fourth quarter 2021 financial results on January 26, 2022, at 10:00 a.m. (Central Time).  This conference call will be an interactive session between management and analysts. Interested parties may listen to this live conference call via Internet webcast by accessing http://ir.cadencebank.com/events. The webcast will also be available in archived format at the same address.

About Cadence Bank

Cadence Bank (NYSE: CADE) is a leading regional banking franchise with approximately $48 billion in assets and more than 400 branch locations across the South, Midwest and Texas. Cadence provides consumers, businesses and corporations with a full range of innovative banking and financial solutions. Services and products include consumer banking, consumer loans, mortgages, home equity lines and loans, credit cards, commercial and business banking, treasury management, specialized lending, asset-based lending, commercial real estate, equipment financing, correspondent banking, SBA lending, foreign exchange, wealth management, investment and trust services, financial planning, retirement plan management, and personal and business insurance. Cadence is committed to a culture of respect, diversity and inclusion in both its workplace and communities. Cadence Bank, Member FDIC. Equal Housing Lender.

Forward-Looking Statements

Certain statements made in this news release are not statements of historical fact and constitute "forward-looking statements" within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and are subject to the safe harbor created thereby under the Private Securities Litigation Reform Act of 1995. These statements are often, but not always, made through the use of words or phrases such as "anticipate," "aspire," "assume," "believe," "budget," "contemplate," "continue," "could," "estimate," "expect," "forecast," "foresee," "goal," "hope," "indicate," "intend," "may," "might," "outlook," "plan," "project," "projection," "predict," "prospect," "potential," "roadmap," "seek," "should," "target," "will," and "would," or the negative versions of those words or other comparable words of a future or forward-looking nature. These forward-looking statements may include, without limitation, discussions regarding general economic, interest rate, real estate market, competitive, employment, and credit market conditions, including the economic impact of the COVID-19 pandemic (including any variant of the COVID-19 virus) on the Company's business; the Company's assets; business; cash flows; financial condition; liquidity; prospects; results of operations; deposit and customer repo growth; interest and fee-based revenue; capital resources; capital metrics; efficiency ratio; valuation of mortgage servicing rights; net income; net interest revenue; non-interest revenue; net interest margin; interest expense; non-interest expense; earnings per share; interest rate sensitivity; interest rate risk; balance sheet and liquidity management; off-balance sheet arrangements; fair value determinations; asset quality; credit quality; credit losses; provision and allowance for credit losses, impairments, charge-offs, recoveries and changes in loan volumes; investment securities portfolio yields and values; ability to manage the impact of pandemics, natural disasters and other force majeure events; adoption and use of critical accounting policies; adoption and implementation of new accounting standards and their effect on the Company's financial results and the Company's financial reporting; utilization of non-GAAP financial metrics; declaration and payment of dividends; ability to pay dividends or coupons on the Company's 5.5% Series A Non-Cumulative Perpetual Preferred Stock, par value $0.01 per share, or the 4.125% Fixed-to-Floating Rate Subordinated Notes due November 20, 2029; mortgage origination volume; mortgage servicing and production revenue; insurance commission revenue; implementation and execution of cost savings initiatives; ability to successfully litigate, resolve or otherwise dispense with threatened, pending, ongoing and future litigation and governmental, administrative and investigatory matters; ability to successfully complete pending or future acquisitions, dispositions and other strategic growth opportunities and initiatives; ability to successfully obtain regulatory approval for acquisitions and other growth initiatives; ability to successfully integrate and manage acquisitions; opportunities and efforts to grow market share; reputation; ability to compete with other financial institutions; ability to recruit and retain key employees and personnel; access to capital markets; availability of capital; investments in the securities of other financial institutions; and ability to operate the Company's regulatory compliance programs in accordance with applicable law.

Forward-looking statements are based upon management's expectations as well as certain assumptions and estimates made by, and information available to, the Company's management at the time such statements were made. Forward-looking statements are not historical facts, are not guarantees of future results or performance and are subject to certain known and unknown risks, uncertainties and other factors that are beyond the Company's control and that may cause actual results to differ materially from those expressed in, or implied by, such forward-looking statements. These risks, uncertainties and other factors include, without limitation, potential delays or other problems in implementing and executing the Company's growth, expansion and acquisition strategies, including delays in obtaining regulatory or other necessary approvals or the failure to realize any anticipated benefits or synergies from any acquisitions or growth strategies; the risks of changes in interest rates and their effects on the level and composition of deposits, loan demand and the values of loan collateral, securities and interest sensitive assets and liabilities; the impact of inflation on consumers; the failure of assumptions underlying the establishment of reserves for possible credit losses, fair value for loans and other real estate owned; changes in real estate values; the availability of and access to capital; possible downgrades in the Company's credit ratings or outlook which could increase the costs or availability of funding from capital markets; the ability to attract new or retain existing deposits or to retain or grow loans; the ability to grow additional interest and fee income or to control noninterest expense; the potential impact of the proposed phase-out of the London Interbank Offered Rate ("LIBOR") or other changes involving LIBOR; competitive factors and pricing pressures, including their effect on the Company's net interest margin; general economic, unemployment, credit market and real estate market conditions, and the effect of such conditions on the creditworthiness of borrowers, collateral values, the value of investment securities and asset recovery values; changes in legal, financial and/or regulatory requirements; recently enacted and potential legislation and regulatory actions and the costs and expenses to comply with new and/or existing legislation and regulatory actions, including those actions in response to the COVID-19 pandemic such as the Coronavirus Aid, Relief, and Economic Security Act (the "CARES Act"), the Economic Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act (the "Economic Aid Act") and any related rules and regulations; changes in U.S. Government monetary and fiscal policy; FDIC special assessments or changes to regular assessments; the enforcement efforts of federal and state bank regulators; possible adverse rulings, judgments, settlements and other outcomes of pending, ongoing and future litigation and governmental, administrative and investigatory matters (including litigation or actions arising from the Company's participation in and administration of programs related to the COVID-19 pandemic (including, among other things, the PPP loan programs authorized by the CARES Act and the Economic Aid Act); the ability to keep pace with technological changes, including changes regarding maintaining cybersecurity; the impact of failure in, or breach of, the Company's operational or security systems or infrastructure, or those of third parties with whom the Company does business, including as a result of cyber-attacks or an increase in the incidence or severity of fraud, illegal payments, security breaches or other illegal acts impacting the Company or the Company's customers; natural disasters or acts of war or terrorism; the adverse effects of the ongoing global COVID-19 pandemic, including the magnitude and duration of the pandemic, and the effect of actions taken to mitigate the impact of the COVID-19 pandemic on the Company, the Company's employees, the Company's customers, the global economy and the financial markets; international or political instability; impairment of the Company's goodwill or other intangible assets; losses of key employees and personnel; adoption of new accounting standards, or changes in existing standards; the outcome of any legal proceedings that may be instituted against the Company or Cadence in respect of the Cadence Merger; the ability of the Company and Cadence to meet expectations regarding the timing, completion and accounting and tax treatments of the Cadence Merger; the risk that any announcements relating to the Cadence Merger could have adverse effects on the market price of the capital stock of the combined company; the possibility that the anticipated benefits of the Cadence Merger will not be realized when expected or at all, including as a result of the impact of, or problems arising from, the integration of the two companies or as a result of the strength of the economy and competitive factors in the areas where the combined company does business; the possibility that the Cadence Merger may be more expensive to complete than anticipated, including as a result of unexpected factors or events; diversion of management's attention from ongoing business operations and opportunities; the possibility that the parties may be unable to achieve expected synergies and operating efficiencies in the Cadence Merger within the expected timeframes or at all and to successfully integrate Cadence's operations and those of the Company; such integration may be more difficult, time consuming or costly than expected; revenues following the Cadence Merger may be lower than expected; potential adverse reactions or changes to business or employee relationships, including those resulting from the completion of the Cadence Merger; the combined company's success in executing its business plans and strategies and managing the risks involved in the foregoing; the dilution caused by the Company's issuance of additional shares of its capital stock in connection with the Cadence Merger and other factors as detailed from time to time in the Company's press and news releases, periodic and current reports and other filings the Company files with the FDIC.

The foregoing factors should not be construed as exhaustive and should be read in conjunction with those factors that are set forth from time to time in the Company's periodic and current reports filed with the FDIC, including those factors included in the Company's Annual Report on Form 10-K for the year ended December 31, 2020 under the heading "Item 1A. Risk Factors," in the Company's Quarterly Reports on Form 10-Q under the heading "Part II-Item 1A. Risk Factors" and in the Company's Current Reports on Form 8-K.

Although the Company believes that the expectations reflected in these forward-looking statements are reasonable as of the date of this news release, if one or more events related to these or other risks or uncertainties materialize, or if the Company's underlying assumptions prove to be incorrect, actual results may prove to be materially different from the results expressed or implied by the forward-looking statements. Accordingly, undue reliance should not be placed on any forward-looking statements. The forward-looking statements speak only as of the date of this news release, and the Company does not undertake any obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except as required by applicable law. New risks and uncertainties may emerge from time to time, and it is not possible for the Company to predict their occurrence or how they will affect the Company.  All written or oral forward-looking statements attributable to the Company are expressly qualified in their entirety by this section.

SOURCE Cadence Bank