MidSouth Bancorp, Inc. Reports Fourth Quarter 2009 Results

- Strong Capital Position with Total Risk Weighted Capital of 20.69%

- Net Earnings before Preferred Dividends Increased 11.8% Year-Over-Year

- Nonperforming Assets to Total Assets a Modest 1.79%

Jan 28, 2010, 17:58 ET from MidSouth Bancorp, Inc.

LAFAYETTE, La., Jan. 28 /PRNewswire-FirstCall/ -- MidSouth Bancorp, Inc. ("MidSouth") (NYSE Amex: MSL) today reported net earnings available to common shareholders of $890,000 for the fourth quarter ended December 31, 2009, a decrease of 16.4% from net earnings available to common shareholders of $1,064,000 reported for the fourth quarter of 2008, and a decrease of 21.4% from net earnings available to common shareholders of $1,132,000 reported for the third quarter of 2009.  Diluted earnings for the fourth quarter of 2009 were $0.13 per common share, a decrease of 18.8% from $0.16 per common share reported for the fourth quarter of 2008, and a decrease of 23.5% from $0.17 per common share reported for the third quarter of 2009.  MidSouth recorded dividends on its Fixed Rate Cumulative Perpetual Preferred Stock, Series A ("Series A Preferred Stock") issued to the U. S. Department of the Treasury on January 9, 2009 under the Capital Purchase Plan which reduced net earnings available to common shareholders by $300,000 for the fourth quarter of 2009 and $299,000 for the third quarter of 2009.  Fourth quarter 2009 net earnings before dividends on Series A Preferred Stock totaled $1,190,000, an increase of $126,000, or 11.8%, over the $1,064,000 earned in the fourth quarter of 2008.

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For the year ended December 31, 2009, net earnings available to common shareholders totaled $3,424,000, a 38.2% decrease from net earnings available to common shareholders of $5,537,000 reported for the year ended December 31, 2008.  Dividends recorded on the Series A Preferred Stock reduced net earnings available to common shareholders by $1,175,000 for the year ended December 31, 2009.  Diluted earnings per common share were $0.51 for the year ended December 31, 2009, compared to $0.83 for 2008.  

C. R. "Rusty" Cloutier, President and Chief Executive Officer, commenting on fourth quarter and annual 2009 results noted, "We ended the year with significantly stronger capital levels, increased our allowance for loan losses and reduced controllable expenses.    We appreciate the hard work of our employees and the support of our investors who have helped MidSouth during the past year to continue to execute on our business strategy to be well-positioned in the coming quarters to serve our commercial and retail customers once demand for credit improves in our markets."

MidSouth's total assets at December 31, 2009 were $972.1 million, a 3.8% increase over the $936.8 million in total assets reported at December 31, 2008.  The $35.3 million increase in assets resulted primarily from a public offering of 2.7 million shares of MidSouth's common stock at $12.75 per share which closed on December 22, 2009 with net proceeds of approximately $32.4 million.  The additional capital increased MidSouth's leverage capital ratio from 8.38% at December 31, 2008 to 13.95% at December 31, 2009.  Tier 1 risk weighted capital and total risk weighted capital ratios were 19.48% and 20.69% at December 31, 2009, compared to 11.04% and 12.16% at December 31, 2008, respectively.  MidSouth plans to use the net proceeds from the offering for general purposes including potential acquisition opportunities.  

Deposits totaled $773.3 million as of December 31, 2009, an increase of $6.6 million, compared to $766.7 million on December 31, 2008.  Total loans were $585.0 million, a decrease of $24.0 million, or 3.9%, from the $609.0 million reported as of December 31, 2008.  Loans decreased throughout 2009 as commercial customers used cash flows to pay down debt and continued economic concerns stemmed loan production in both commercial and retail credits.  

Fourth quarter 2009 net earnings before dividends on Series A Preferred Stock increased $126,000 from fourth quarter 2008 net earnings and were positively impacted by a $650,000 decrease in the provision for loan losses and a $383,000 decrease in non-interest expense, which offset a $447,000 decrease in quarterly revenues and a $460,000 increase in income tax expense.  Decreases in non-interest expenses primarily consisted of $242,000 in shares tax expense, $240,000 in marketing costs, $80,000 in corporate development and training expenses, $72,000 in professional fees, and $57,000 in directors' fees, offset by a $308,000 increase in salaries and benefit costs.  The increased salaries and benefit expense resulted primarily from $246,000 in additional costs associated with group health insurance coverage.  Quarterly revenues, defined as net interest income and non-interest income, decreased primarily due to a $378,000 reduction in net interest income, which was driven by a decline in earning asset yields and loan volume in quarterly comparison.  Additionally, MidSouth recorded a $178,000 impairment charge on an equity security in the fourth quarter of 2009, which reduced non-interest income.  Increased service charges on deposit accounts partially offset the impact of the impairment charge.  The equity security is an investment in a portfolio of common stocks of community bank holding companies.  The $460,000 increase in income tax expense in quarterly comparison resulted primarily from an increase in pre-tax earnings in prior year quarterly comparison and from the effect of certain federal tax credits recorded in the fourth quarter of 2008.  

In linked-quarter comparison, net earnings before dividends on Series A Preferred Stock decreased $241,000, primarily due to the $1.35 million provision for loan losses recorded in the fourth quarter of 2009 compared to the $1.0 million provision recorded for the third quarter of 2009.  Net interest income decreased $91,000 in linked-quarter comparison and non-interest income decreased $286,000, primarily due to the $178,000 impairment charge on the equity security.  Non-interest expense decreased $357,000, primarily due to a $246,000 decrease in shares tax expense.  Reductions in several other non-interest expense categories offset increases in occupancy and marketing expenses in linked-quarter comparison.  Additionally, a $222,000 decrease in salaries expense offset a $200,000 increase in the cost of group health insurance.

In year-to-date comparison, net earnings before dividends on Series A Preferred Stock decreased $938,000 primarily due to a $895,000 increase in the provision for loan losses.  Net interest income increased $434,000 as deposit rate reductions throughout 2009 lowered interest expense and offset decreased interest income from earning assets.  Non-interest income decreased in annual comparison primarily as a result of the $178,000 impairment charge on the equity security, a $120,000 decrease in income from a third party investment advisory firm, and a $131,000 one-time payment recorded in other non-interest income in 2008.  The one-time payment resulted from VISA's mandatory redemption of a portion of its Class B shares outstanding in connection with its initial public offering.  The impact of these and other decreases in other non-interest income categories was offset by a $327,000 increase in ATM and debit card income and a $124,000 increase in service charges on deposit accounts and resulted in a net reduction in non-interest income of $82,000 in year-to-date comparison.   Non-interest expense increased $719,000 in year-to-date comparison, due to higher FDIC premiums ($1,178,000), salary and benefits costs ($792,000) and occupancy expenses ($601,000), offset by a $1,852,000 decrease in other non-interest expenses.  The $1,852,000 reduction in non-interest expenses included significant decreases of $977,000 in marketing costs, $278,000 in corporate development and training expenses, $197,000 in professional fees, $157,000 in shares tax expense, and $213,000 in expenses recorded in 2008 related to the data conversion and merger of the Texas bank charter into the Louisiana charter.  Income tax expense decreased $324,000 due to the effect of certain federal tax credits combined with lower annual pre-tax profits and sustained tax exempt income levels.  

Asset Quality. Nonaccrual loans totaled $16.2 million as of December 31, 2009, compared to $9.4 million as of December 31, 2008 and $15.5 million at September 30, 2009.  Of the $16.2 million at December 31, 2009, $12.2 million, or 75.1%, represented two large commercial real estate loan relationships in the Baton Rouge market.  Loans past due 90 days or more and still accruing totaled $0.4 million at December 31, 2009, a decrease of $600,000 from the $1.0 million reported for December 31, 2008 and a decrease of $1.2 million from the $1.6 million reported for September 30, 2009.  Total nonperforming assets to total assets were 1.79% at December 31, 2009, compared to 1.17% at December 31, 2008 and 1.90% at September 30, 2009.

With respect to the $12.2 million in two large commercial real estate loan relationships in the Baton Rouge market that are nonaccrual, $3.9 million is related to a national participation loan.  In the fourth quarter of 2009, an additional $300,000 was charged off on the loan, bringing the total charged off in 2009 to $1.8 million.  The loan will be a long term work-out based on actions taken by the lead bank.  The second loan is an $8.3 million commercial real estate loan in the Baton Rouge market which primarily funded construction of a condominium complex.  As part of a work-out plan, the units are now being leased as apartments, with 57% of the units under lease agreements.  Additionally, principal reductions totaling $96,000 were recorded on the loan in the fourth quarter of 2009.

Allowance coverage for nonperforming loans was 48.28% at December 31, 2009, compared to 73.22% at December 31, 2008 and 46.82% at September 30, 2009.  Excluding the effect of the two large commercial real estate loan relationships in the Baton Rouge market, allowance coverage for nonperforming loans was 158.37% at December 31, 2009, 342.88% at December 31, 2008, and 213.23% at September 30, 2009.  Year-to-date net charge-offs were 0.86% of total loans for the fourth quarter of 2009 compared to 0.40% for the fourth quarter of 2008 and 0.83% (annualized) for the third quarter of 2009.  The ALLL/total loans ratio was 1.37% at December 31, 2009, 1.25% at December 31, 2008 and 1.36% at September 30, 2009. 

Earnings Analysis

Net Interest Income.   Fully taxable-equivalent ("FTE") net interest income totaled $10,275,000 for the fourth quarter of 2009, a decrease of 3.9%, or $420,000, from the $10,695,000 reported for the fourth quarter of 2008.  The decrease in FTE net interest income resulted primarily from a decrease in loan volume and yields on loans in prior year quarterly comparison.  Additionally, a higher volume of interest bearing deposits, time deposits, and federal funds sold earned minimal rates and the yield on investment securities declined due to a higher volume of short-term agency securities within the portfolio.  Approximately $62.6 million in short-term agency securities were purchased late in the fourth quarter of 2009 with proceeds from the common stock offering and excess federal funds sold.  Deposit rate reductions lowered interest expense in prior year quarterly comparison and partially offset the impact of decreased earning assets yields.   As a result, the FTE net interest margin decreased 38 basis points, from 5.05% for the fourth quarter of 2008 to 4.67% for the fourth quarter of 2009.

In linked-quarter comparison, FTE net interest income declined $100,000, with decreased interest expense from lower deposit rates partially offsetting decreased income from earning assets.  Balance sheet and yield changes in linked-quarter comparison resulted in a 15 basis point decrease in the FTE net interest margin, from 4.82% at September 30, 2009 to 4.67% at December 31, 2009.

In year-to-date comparison, FTE net interest income increased $448,000 as interest expense decreased $5,865,000, offsetting a $5,417,000 decline in FTE interest income.  Interest expense decreased primarily due to an 87 basis point reduction in the average rate paid on interest-bearing liabilities, from 2.45% at December 31, 2008 to 1.58% at December 31, 2009.  Despite increased FTE net interest income, the FTE net interest margin declined 5 basis points, from 4.93% for the year ended December 31, 2008 to 4.88% for the year ended December 31, 2009, as decreased earning asset yields offset the impact of an increase in the average volume of earning assets.

About MidSouth Bancorp, Inc.

MidSouth Bancorp, Inc. is a bank holding company headquartered in Lafayette, Louisiana with assets of $972 million as of December 31, 2009.  Through our wholly owned subsidiary, MidSouth Bank, N.A., we offer a full range of banking services to commercial and retail customers in south Louisiana and southeast Texas.  MidSouth Bank has 35 locations in Louisiana and Texas and more than 50 ATMs.  

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, changes in the local and national economy and potential acquisitions.  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; 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 coverages, and changes in the U.S. Treasury's Capital Purchase Program; and other factors discussed under the heading "Risk Factors" in MidSouth's Registration Statement on Form S-1/A filed with the SEC on December 9, 2009 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.

    
                                                                         
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    MIDSOUTH BANCORP, INC. and SUBSIDIARIES                                  
    Condensed Consolidated Financial Information (unaudited)                 
    (in thousands except per share data)                                     
    ------------------------------------------------------------------------- 
                                                       
                                                            For the 
                                                            Quarter          
                      For the Quarter Ended                  Ended      
                              December                     September
                                 31,            %             30,      %   
    EARNINGS DATA         2009        2008    Change         2009    Change 
                          ----        ----    ------         ----    ------ 
      Total interest                                                         
       income           $12,253     $13,699   -10.6%        $12,498    -2.0%
      Total interest                                                        
       expense            2,412       3,480   -30.7%          2,566    -6.0%
                          -----       -----                   -----         
        Net interest                                                        
         income           9,841      10,219    -3.7%          9,932    -0.9%
                          -----      ------                   -----         
      FTE net interest                                                      
       income            10,275      10,695                  10,375         
                         ------      ------                  ------         
      Provision for                                                         
       loan losses        1,350       2,000   -32.5%          1,000    35.0%
                          -----       -----                   -----         
      Non-interest 
       income             3,686       3,755    -1.8%          3,972    -7.2%
      Non-interest
       expense           10,969      11,352    -3.4%         11,326    -3.2%
                         ------      ------                  ------         
        Net earnings                                                        
         before income                                                      
         taxes            1,208         622                   1,578         
      Provision for                                                         
       income taxes          18        (442) -104.1%            147   -87.8%
                            ---        ----                     ---         
        Net earnings      1,190       1,064    11.8%          1,431   -16.8%
      Dividends on                                                          
       preferred stock      300           -   100.0%            299     0.3%
                            ---         ---                     ---         
        Net earnings                                                        
         available to                                                       
         common 
         shareholders      $890      $1,064   -16.4%         $1,132   -21.4%
                           ====      ======                  ======         
                                                                            
    PER COMMON SHARE DATA                                                   
      Basic earnings                                                        
       per share          $0.13       $0.16   -18.8%          $0.17   -23.5%
      Diluted earnings                                                      
       per share          $0.13       $0.16   -18.8%          $0.17   -23.5%
      Quarterly                                                             
       dividends per                                                        
       share              $0.07       $0.07     0.0%          $0.07     0.0%
      Book value at                                                         
       period end        $11.81      $11.04     7.0%         $11.83    -0.2%
      Tangible book                                                         
       value at 
       period end        $10.79       $9.59    12.5%         $10.39     3.8%
      Market price at                                                       
       period end        $13.90      $12.75     9.0%         $13.20     5.3%
      Shares 
       outstanding                                                          
       at period 
       end (1)        9,318,267   6,618,220    40.8%      6,618,268    40.8%
      Weighted 
       average                                                              
       shares 
       outstanding                                                          
        Basic         6,888,406   6,614,263     4.1%      6,592,110     4.5%
        Diluted       6,906,206   6,633,143     4.1%      6,612,428     4.4%
                                                                            
    AVERAGE BALANCE                                                         
     SHEET DATA                                                             
      Total assets     $954,441    $923,059     3.4%       $934,519     2.1%
      Loans and 
       leases           583,756     595,765    -2.0%        594,050    -1.7%
      Total deposits    776,784     776,201     0.1%        765,776     1.4%
      Total common                                                          
       equity (1)        83,763      70,274    19.2%         77,599     7.9%
      Total tangible                                                        
       common equity     74,269      60,669    22.4%         68,077     9.1%
      Total equity (2)  102,951      70,274    46.5%         96,738     6.4%
                                                                            
    
    SELECTED RATIOS      12/31/2009  12/31/2008              9/30/2009      
                         ----------  ----------              ---------      
      Return on average                                                     
       assets               0.37%       0.46%  -19.6%           0.48%  -22.9%
      Return on                                                             
       average                                                              
       tangible common                                                      
       equity                4.75%       6.01%  -21.0%           6.60%  -28.0%
      Average loans to                                                      
       average deposits     75.15%      76.75%   -2.1%          77.57%   -3.1%
      Taxable-equivalent                                                    
       net interest margin   4.67%       5.05%   -7.5%           4.82%   -3.1%
       Leverage capital                                                     
        ratio (1)           13.95%       8.38%   66.5%          10.62%   31.4%
                                                                            
    CREDIT QUALITY                                                          
      Allowance for                                                         
       loan losses 
       (ALLL) as a % 
       of total loans        1.37%       1.25%    9.3%           1.36%    0.5%
      Nonperforming                                                        
       assets to total                                                     
       equity + ALLL        12.63%      13.64%   -7.4%          17.04%  -25.9%
      Nonperforming                                                        
       assets to total                                                     
       loans, other real                                                   
       estate owned and                                                    
       other foreclosed                                                    
       assets                1.79%       1.17%   53.0%           1.90%   -5.8% 
         Annualized net                                                    
     YTD charge-offs to                                                    
      total loans            0.86%       0.40%  115.4%           0.83%    3.8%
                                                                           
                                                                           
     (1) On December 22, 2009, the Company completed an underwritten capital
         offering of 2.7 million shares of common stock at $12.75 per 
         share.  On January 7, 2010, the underwriters of the offering 
         exercised their overallotment option and the Company issued an 
         additional 405,000 of common stock at $12.75. 
     (2) On January 9, 2009, the Company participated in the Capital Purchase
         Plan of the U. S. Department of the Treasury, which added 
         $20 million in capital. 
    
    
    
                                                                              
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    MIDSOUTH BANCORP, INC. and SUBSIDIARIES                                   
    Condensed Consolidated Financial Information (unaudited)                  
    (in thousands)                                                            
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                            December   December           September    June   
         BALANCE SHEET          31,        31,     %          30,       30,   
                               2009       2008   Change      2009      2009 
                               ----       ----   ------      ----      ---- 
    Assets                                                                    
    Cash and cash                                                             
     equivalents             $23,350    $24,786    -5.8%    $62,585   $39,653 
                             -------    -------             -------   ------- 
    Securities available-                                                     
     for-sale                271,808    225,944    20.3%    218,795   204,918 
    Securities held-to-                                                       
     maturity                  3,043      6,490   -53.1%      3,218     3,668 
                               -----      -----               -----     ----- 
         Total investment                                                     
          securities         274,851    232,434    18.2%    222,013   208,586 
                             -------    -------             -------   ------- 
    Time deposits held in                                                     
     banks                    26,122      9,023   189.5%     16,023    21,023 
    Other investments          4,902      4,309    13.8%      4,428     4,429 
    Total loans              585,042    608,955    -3.9%    588,589   596,114 
    Allowance for loan                                                        
     losses                   (7,995)    (7,586)    5.4%     (8,015)   (8,039)
                              ------     ------              ------    ------ 
         Loans, net          577,047    601,369    -4.0%    580,574   588,075 
                             -------    -------             -------   ------- 
    Premises and equipment    38,737     40,580    -4.5%     39,049    39,580 
    Goodwill and other                                                        
     intangibles               9,483      9,605    -1.3%      9,508     9,540 
    Other assets              17,650     14,709    20.0%     13,650    13,308 
                              ------     ------              ------    ------ 
         Total assets       $972,142   $936,815     3.8%   $947,830  $924,194 
                            ========   ========            ========  ======== 
                                                                              
                                                                              
    Liabilities and                                                           
     Stockholders' Equity                                                     
    Non-interest bearing                                                      
     deposits               $175,173   $199,899   -12.4%   $181,115  $185,332 
    Interest bearing                                                          
     deposits                598,112    566,805     5.5%    590,976   577,320 
                             -------    -------             -------   ------- 
       Total deposits        773,285    766,704     0.9%    772,091   762,652 
    Securities sold under                                                     
     agreements to                                                            
     repurchase and other                                                     
     short term borrowings    48,758     75,876   -35.7%     55,366    45,809 
    Junior subordinated                                                       
     debentures               15,465     15,465       -      15,465    15,465 
    Other liabilities          5,357      5,726    -6.4%      7,466     6,470 
                               -----      -----               -----     ----- 
         Total liabilities   842,865    863,771    -2.4%    850,388   830,396 
                             -------    -------             -------   ------- 
    Total shareholders'                                                       
     equity (1)              129,277     73,044    77.0%     97,442    93,798 
                             -------     ------              ------    ------ 
          Total liabilities                                                   
           and shareholders'                                                  
           equity           $972,142   $936,815     3.8%   $947,830  $924,194 
                            ========   ========            ========  ======== 
                                                                              
     (1) On December 22, 2009, the Company completed an underwritten capital 
         offering of 2.7 million shares of common stock at $12.75 per 
         share.  On January 7, 2010, the underwriters of the offering 
         exercised their overallotment option and the Company issued an 
         additional additional 405,000 of common stock at $12.75.  On 
         January 9, 2009, the Company participated in the Capital Purchase 
         Plan  of the U. S. Department of the Treasury, which added 
         $20 million in capital. 
    
    
    
                                                                        
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    MIDSOUTH BANCORP, INC. and SUBSIDIARIES                             
    Condensed Consolidated Financial Information (unaudited)            
    (in thousands except per share data)                                
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                          Three Months                                  
                              Ended                 Year Ended          
     EARNINGS STATEMENT   December 31,      %      December 31,     %   
                           2009    2008  Change     2009    2008 Change 
                           ----    ----  ------     ----    ---- ------ 
                                                                        
    Interest income     $12,253 $13,699   -10.6% $50,041 $55,472   -9.8%
    Interest expense      2,412   3,480   -30.7%  10,220  16,085  -36.5%
                          -----   -----           ------  ------        
         Net interest
         income           9,841  10,219    -3.7%  39,821  39,387    1.1%
                          -----  ------           ------  ------        
    Provision for                                                       
     loan losses          1,350   2,000   -32.5%   5,450   4,555   19.6%
                          -----   -----            -----   -----        
    Service                                                             
     charges                                                            
     on deposit                                                         
     accounts             2,689   2,571     4.6%  10,389  10,265    1.2%
    Other charges                                                       
     and fees               997   1,184   -15.8%   4,657   4,863   -4.2%
                            ---   -----            -----   -----        
         Total non-                                                     
          interest 
          income          3,686   3,755    -1.8%  15,046  15,128   -0.5%
                          -----   -----           ------  ------        
    Salaries and                                                        
     employee  benefits   5,487   5,179     5.9%  21,743  20,951    3.8%
    Occupancy expense     2,371   2,406    -1.5%   9,288   8,687    6.9%
    FDIC premiums           303     142   113.4%   1,684     506  232.8%
    Other non-                                                          
     interest                                                           
     expense              2,808   3,625   -22.5%  11,978  13,830  -13.4%
                          -----   -----           ------  ------        
         Total non-                                                     
          interest
          expense        10,969  11,352    -3.4%  44,693  43,974    1.6%
                         ------  ------           ------  ------        
    Income before                                                       
     income taxes         1,208     622    94.2%   4,724   5,986  -21.1%
    Provision for                                                       
     income taxes            18    (442) -104.1%     125     449  -72.2%
                             --    ----              ---     ---        
    Net earnings          1,190   1,064    11.8%   4,599   5,537  -16.9%
    Dividends on                                                        
     preferred stock        300       -   100.0%   1,175       -  100.0%
                            ---     ---            -----     ---        
    Net earnings                                                        
     available to                                                       
     common                                                             
     shareholders          $890  $1,064   -16.4%  $3,424  $5,537  -38.2%
                           ====  ======           ======  ======        
                                                                        
                                                                        
    Earnings per common                                                 
     share, diluted       $0.13   $0.16   -18.8%   $0.51   $0.83        
                          =====   =====            =====   =====        
    
    
    
                                                                          
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    MIDSOUTH BANCORP, INC. and SUBSIDIARIES                               
    Condensed Consolidated Financial Information (unaudited)              
    (in thousands except per share data)                                  
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         EARNINGS STATEMENT       Fourth  Third   Second   First   Fourth 
          QUARTERLY TRENDS       Quarter Quarter Quarter  Quarter Quarter 
                                    2009    2009    2009     2009    2008 
                                    ----    ----    ----     ----    ---- 
    Interest income              $12,253 $12,498 $12,496  $12,794 $13,699 
    Interest expense               2,412   2,566   2,574    2,668   3,480 
                                   -----   -----   -----    -----   ----- 
         Net interest income       9,841   9,932   9,922   10,126  10,219 
    Provision for loan losses      1,350   1,000   2,100    1,000   2,000 
                                   -----   -----   -----    -----   ----- 
    Net interest income after                                             
     provision for loan loss       8,491   8,932   7,822    9,126   8,219 
    Total non-interest income      3,686   3,972   3,858    3,530   3,755 
    Total non-interest expense    10,969  11,326  11,132   11,266  11,352 
                                  ------  ------  ------   ------  ------ 
         Income before                                                    
          income taxes             1,208   1,578     548    1,390     622 
    Income taxes                      18     147    (197)     157    (442)
                                      --     ---    ----      ---    ---- 
         Net earnings              1,190   1,431     745    1,233   1,064 
    Dividends on                                                          
     preferred stock                 300     299     299      277       - 
                                     ---     ---     ---      ---     --- 
         Net earnings available                                           
          to common shareholders    $890  $1,132    $446     $956  $1,064 
                                    ====  ======    ====     ====  ====== 
                                                                          
    Earnings per share, diluted    $0.13   $0.17   $0.07    $0.14   $0.16 
    
    
    
                                                                              
    ------------------------------------------------------------------------- 
    MIDSOUTH BANCORP, INC. and SUBSIDIARIES                                   
    Condensed Consolidated Financial Information (unaudited)                  
    (in thousands)                                                            
    ------------------------------------------------------------------------- 
                                                                              
                               December  December          September    June  
       COMPOSITION OF LOANS       31,       31,     %          30,      30,  
                                 2009      2008    Change     2009     2009
                                 ----      ----    ------     ----     ----
                                                                              
    Commercial, financial, and                                                
     agricultural               $192,347  $210,058   -8.4%   $196,436 $200,192
    Lease financing receivable     7,589     8,058   -5.8%      7,112    7,538
    Real estate - mortgage       265,175   234,588   13.0%    264,242  242,595
    Real estate - construction    39,544    65,327  -39.5%     37,403   60,062
    Installment loans to                                                      
     individuals                  79,476    89,901  -11.6%     82,138   84,602
    Other                            911     1,023  -10.9%      1,258    1,125
                                     ---     -----              -----    -----
                                                                              
    Total loans                 $585,042  $608,955   -3.9%   $588,589 $596,114
                                ========  ========           ======== ========
    
    
    
                                                                          
    --------------------------------------------------------------------- 
    MIDSOUTH BANCORP, INC. and SUBSIDIARIES                               
    Condensed Consolidated Financial Information (unaudited)              
    (in thousands)                                                        
    --------------------------------------------------------------------- 
                                                                          
                            December   December          September  June   
     ASSET QUALITY DATA        31,        31,      %        30,      30,   
                              2009       2008   Change     2009     2009 
                              ----       ----   ------     ----     ---- 
                                                                          
    Nonaccrual loans       $16,183     $9,355    73.0%   $15,520  $15,664 
    Loans past due                                                        
     90  days and over         378      1,005   -62.4%     1,600      791 
                               ---      -----              -----      --- 
    Total                                                                 
     nonperforming                                                        
     loans                  16,561     10,360    59.9%    17,120   16,455 
    Other real                                                            
     estate owned                                                         
     (ORE)                     792        329   140.7%       758      829 
    Other foreclosed                                                      
     assets                     51        306   -83.3%        89      203 
                                --        ---                 --      --- 
    Total                                                                 
     nonperforming                                                        
     assets                $17,404    $10,995    58.3%   $17,967  $17,487 
                           =======    =======            =======  ======= 
                                                                          
    Nonperforming assets                                                  
     to  total assets         1.79%      1.17%   53.0%      1.90%    1.89%
    Nonperforming assets                                                  
     to total loans +                                                     
     ORE + other  
     foreclosed assets        2.97%      1.80%   65.0%      3.05%    2.93%
    ALLL to                                                               
     nonperforming                                                        
     loans                   48.28%     73.22%  -34.1%     46.82%   48.85%
    ALLL to total loans       1.37%      1.25%    9.3%      1.36%    1.35%
                                                                          
    Year-to-date                                                          
     charge-offs            $5,268     $2,624   100.8%    $3,872   $2,779 
    Year-to-date                                                          
     recoveries                227        192    18.2%       201      132 
                               ---        ---                ---      --- 
    Year-to-date                                                          
     net charge-offs        $5,041     $2,432   107.3%    $3,671   $2,647 
                            ======     ======             ======   ====== 
    Annualized net YTD                                                    
     charge-offs to                                                       
     total loans              0.86%      0.40%  115.4%      0.83%    0.90%
    
    
    
    ------------------------------------------------------------------------- 
    MIDSOUTH BANCORP, INC. and SUBSIDIARIES                                   
    Condensed Consolidated Financial Information (unaudited)                  
    (in thousands)                                                            
    ------------------------------------------------------------------------- 
                                                                              
        YIELD ANALYSIS     Three Months Ended        Three Months Ended 
                            December 31, 2009         December 31, 2008
                            -----------------         ------------------
                                                                              
                                Tax                             Tax           
                   Average   Equivalent  Yield/    Average   Equivalent Yield/ 
                    Balance    Interest   Rate      Balance    Interest   Rate  
                    -------    --------   ----      -------    --------   ----  
                                                                              
    Taxable                                                                   
     securities     $112,170       $859   3.06%    $106,894     $1,199   4.49%
    Tax-exempt                                                                
     securities      112,386      1,482   5.27%     119,713      1,618   5.41%
    Other                                                                     
     investments                                                              
     and interest                                                             
     bearing                                                                  
     deposits         20,870         41   0.79%       4,327         31   2.87%
    Federal funds                                                             
     sold             18,209          8   0.17%       4,722         13   1.08%
    Time deposits 
     in other 
     banks            25,263         75   1.18%      11,120         92   3.29%
    Loans            583,756     10,222   6.95%     595,765     11,222   7.49%
                     -------     ------             -------     ------        
      Total                                                                   
       interest                                                               
       earning                                                                
       assets        872,654     12,687   5.77%     842,541     14,175   6.69%
    Non-interest                                                              
     earning 
     assets           81,787                         80,518                   
                      ------                         ------                   
         Total                                                                
          assets    $954,441                       $923,059                   
                    ========                       ========                   
                                                                              
    Interest 
     bearing                                                                  
     liabilities:                                                             
      Deposits      $596,822     $1,875   1.25%    $583,453      2,885   1.97%
      Repurchase                                                              
       agreements     53,913        295   2.17%      35,324        235   2.60%
      Federal funds                                                           
       purchased         180          -      -        4,179         11   1.03%
      Other                                                                   
       borrowings          -          -      -       15,116         49   1.29%
      Junior                                                                  
       subordinated                                                           
       debentures     15,465        242   6.12%      15,465        300   7.59%
                      ------        ---              ------        ---        
         Total                                                                
          interest
          bearing                                                             
          liabili-
          ties       666,380      2,412   1.44%     653,537      3,480   2.12%
                     -------      -----             -------      -----
    Non-interest                                                              
     bearing                                                                  
     liabilities     185,110                        199,248                   
    Shareholders'                                                             
     equity          102,951                         70,274                   
                     -------                         ------                   
         Total                                                                
          liabili-
          ties                                                                
          and                                                                 
          share-
          holders'                                                            
          equity     $954,441                       $923,059                   
                     ========                       ========                   
                                                                              
      Net interest                                                            
       income (FTE)
       and margin               $10,275   4.67%                $10,695   5.05%
                                =======                        =======        
                                                                              
      Net interest                                                            
       spread                             4.33%                          4.57%
    
    
    
    ------------------------------------------------------------------------- 
    MIDSOUTH BANCORP, INC. and SUBSIDIARIES                                   
    Condensed Consolidated Financial Information (unaudited)                  
    (in thousands)                                                            
    ------------------------------------------------------------------------- 
                                                                              
        YIELD ANALYSIS       Year Ended                 Year Ended 
                         December 31, 2009           December 31, 2008
                         -----------------           ------------------
                                                                              
                                Tax                             Tax           
                   Average   Equivalent  Yield/    Average   Equivalent Yield/
                    Balance    Interest   Rate      Balance    Interest   Rate
                    -------    --------   ----      -------    --------   ----
                                                                             
    Taxable 
     securities     $101,556     $3,905   3.85%    $97,363     $4,380   4.50%
    Tax-exempt 
     securities      115,176      6,159   5.35%    112,801      6,100   5.41%
    Other 
     investments                                                             
     and interest                                                            
     bearing                                                                 
     deposits          9,403        143   1.52%      5,817        170   2.92%
    Federal funds
     sold             17,617         37   0.21%     29,406        669   2.24%
    Time deposits                                                            
     in other banks   15,264        262   1.69%     14,247        413   2.90%
    Loans            593,589     41,341   6.96%    575,355     45,532   7.91%
                     -------     ------            -------     ------        
      Total                                                                  
       interest 
       earning                                                               
       assets        852,605     51,847   6.08%    834,989     57,264   6.86%
    Non-interest                                                             
     earning assets   81,929                        82,898                   
                      ------                        ------                   
         Total 
          assets    $934,534                      $917,887                   
                    ========                      ========                   
                                                                             
    Interest                                                                 
     bearing                                                                 
     liabilities:   
      Deposits      $580,814     $8,103   1.40%   $599,803    $13,910   2.32%
                                                                             
      Repurchase                                                              
       agreements     44,318       1070   2.41%     33,506        822   2.41%
      Federal                                                                 
       funds                                                                  
       purchased         622          5   0.79%      2,493         53   2.09%
      Other 
       borrowings      4,625         23   0.50%      4,943         81   1.64%
      Junior                                                                  
       subordinated                                                           
       debentures     15,465       1019   6.50%     15,465      1,219   7.75%
                      ------       ----             ------      -----        
         Total                                                               
          interest 
          bearing                                                            
          liabili-
          ties       645,844     10,220   1.58%    656,210     16,085   2.45%
                                 ------                        ------        
    Non-interest                                                             
     bearing                                                                 
     liabilities     191,225                       190,579                   
    Shareholders' 
     equity           97,465                        71,098                   
                      ------                        ------                   
          Total
           liabili-
           ties and                                                           
           share-
           holders' 
           equity   $934,534                      $917,887                   
                    ========                      ========                   
                                                                             
      Net interest                                                           
       income (FTE)
       and margin               $41,627   4.88%               $41,179   4.93%
                                =======                       =======        
                                                                             
      Net interest
       spread                             4.50%                         4.41%
    
    
    
    ----------------------------------------------------------------------
    MIDSOUTH BANCORP, INC. and SUBSIDIARIES                               
    Reconciliation of Non-GAAP Financial Measures                         
    (in thousands except per share data)                                  
    ----------------------------------------------------------------------
                                                                          
                                                  For the Quarter Ended   
                                               December December September
    Per Common Share Data                         31,      31,       30,  
                                                 2009     2008       2009
                                                 ----     ----       ----
                                                                         
    Book value per common share                $11.81   $11.04     $11.83
    Effect of intangible assets per share        1.02     1.45       1.44
                                                 ----     ----       ----
         Tangible book value per common share  $10.79    $9.59     $10.39
                                               ======    =====     ======
                                                                         
    Average Balance Sheet Data                                           
                                                                         
    Total equity                             $102,951  $70,274    $96,738
    Preferred equity                           19,188        -     19,139
                                               ------      ---     ------
         Total common equity                  $83,763  $70,274    $77,599
    Intangible assets                           9,494    9,605      9,522
                                                -----    -----      -----
        Tangible common equity                $74,269  $60,669    $68,077
                                              =======  =======    =======
                                                                         
         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.