TUPELO, Miss., July 27, 2020 /PRNewswire/ — Renasant Corporation (NASDAQ: RNST) (the «Company») today announced earnings results for the second quarter of 2020. Net income for the second quarter of 2020 was $20.1 million, as compared to $46.6 million for the second quarter of 2019. Basic and diluted earnings per share («EPS») were $0.36 for the second quarter of 2020, as compared to basic and diluted EPS of $0.80 for the second quarter of 2019.

Net income for the six months ending June 30, 2020, was $22.1 million, as compared to net income of $91.7 million for the same time period in 2019. Basic and diluted EPS were $0.39 for the first six months of 2020, as compared to basic and diluted EPS of $1.57 and $1.56, respectively, for the first six months of 2019.

«Our second quarter results reflect a rebound in core earnings when compared to the first quarter and truly highlight our team’s continued commitment to the core operations of the bank,» commented C. Mitchell Waycaster, Renasant President and Chief Executive Officer. «Our team members are continuing to execute our long-term strategy throughout our footprint while providing extraordinary service to our customers. During the quarter, our team closed over 10,500 PPP loans and worked through our internal deferral programs with both commercial and consumer customers. While there are still many economic uncertainties, we remain committed to meeting the needs of our clients and prudently managing our balance sheet while focusing on profitable growth without sacrificing credit quality.»

«There are several bright spots in our results that highlight the strong underlying fundamentals of our core business,» commented Kevin D. Chapman, Renasant Chief Operating and Financial Officer. «Our mortgage division had another tremendous quarter, with over $1.67 billion of production, continuing to provide an excellent source of diversity in our revenue streams, and our core expenses are trending in the right direction. Our credit quality remains sound and is top-of-mind as we’ve continued the enhanced monitoring of our loan portfolio implemented in the first quarter of this year, especially the segments we believe are most likely to be adversely impacted by changes in economic activity as a result of the pandemic. Still, in response to the continued economic uncertainty stemming from the pandemic, during the second quarter, we prudently increased our reserves and recorded a $29.5 million provision for loan losses and unfunded commitments. We continue to monitor the impact the pandemic is having on every aspect of our operations, but even during these uncertain times, our commitment to serve the needs of each of our stakeholders remains unchanged.»

Paycheck Protection Program and COVID-19 Response Update
Through June 30, 2020, the Company has closed over 10,500 Paycheck Protection Program («PPP») loans in the aggregate amount of approximately $1.3 billion.  The Company made PPP loans to both new and existing customers, and generated over $44.7 million in gross fees. Based on trends thus far, the Company does not anticipate the amount of these fees will be materially impacted by payments required to be made to agents of PPP borrowers.

The Company’s branch lobbies remain accessible by appointment only (and appointments are generally limited to services that require access inside a branch, such as access to a safe-deposit box to address a pressing need), while protocols designed to minimize Company employees’ exposure to COVID-19, such as working remotely, reconfiguring work spaces to promote social distancing and adjusting staff levels, remain in place. As discussed in more detail below, the Company continued to incur expenses, primarily related to employee overtime and other employee benefit accruals, in its response to the COVID-19 pandemic and expects that it will continue to incur elevated expenses even while conditions presenting significant challenges to growth persist. At this time, it remains difficult to accurately predict the duration of this new operating reality. Management’s decision on when to return to pre-pandemic operating procedures will take into account the best interests of all of the Company’s stakeholders.

Impact of Certain Expenses and Charges
From time to time, the Company incurs expenses and charges in connection with certain transactions with respect to which management is unable to accurately predict when these expenses or charges will be incurred or, when incurred, the amount of such expenses or charges. The following table presents the impact of these expenses and charges on reported EPS for the second quarter of 2020. There were no such expenses and charges that had a material impact during the second quarter of 2019 or the first six months of 2019. The «COVID-19 related expenses» line item in the table below primarily consists of (a) employee overtime and employee benefit accruals directly related to the Company’s response to both the COVID-19 pandemic itself and federal legislation enacted to address the pandemic, such as the CARES Act, and (b) expenses associated with supplying branches with protective equipment and sanitation supplies (such as floor markings and cautionary signage for branches, face coverings and hand sanitizer) as well as more frequent and rigorous branch cleaning.

(in thousands, except per share data)

Three Months Ended

Six Months Ended

June 30, 2020

June 30, 2020

Pre-tax

After-tax

Impact to
Diluted
EPS

Pre-tax

After-tax

Impact to
Diluted
EPS

Earnings, as reported

$

24,767

$

20,130

$

0.36

$

27,548

$

22,138

$

0.39

MSR valuation adjustment

4,951

4,045

0.07

14,522

11,835

0.21

COVID-19 related expenses

6,257

5,113

0.09

9,160

7,465

0.13

Earnings, with exclusions (Non-GAAP)

$

35,975

$

29,288

$

0.52

$

51,230

$

41,438

$

0.73

A reconciliation of all non-GAAP financial measures disclosed in this release from GAAP to non-GAAP is included in the tables at the end of this release. The information below under the heading «Non-GAAP Financial Measures» explains why the Company believes the non-GAAP financial measures in this release provide useful information and describes the other purposes for which the Company uses non-GAAP financial measures.

Profitability Metrics
The following tables present the Company’s profitability metrics, including and excluding the impact of the mortgage servicing rights (MSR) valuation adjustment, debt prepayment penalties, merger and conversion expenses and COVID-19 related expenses, as applicable, for the dates presented:

As Reported

With Exclusions
(Non-GAAP)

Three Months Ended

Three Months Ended

June 30,
2020

March 31,
2020

June 30,
2019

June 30,
2020

March 31,
2020

June 30,
2019

Return on average assets

0.55

%

0.06

%

1.47

%

0.80

%

0.33

%

1.47

%

Return on average tangible assets (Non-GAAP)

0.63

%

0.11

%

1.64

%

0.90

%

0.40

%

1.64

%

Return on average equity

3.85

%

0.38

%

8.90

%

5.62

%

2.10

%

8.92

%

Return on average tangible equity (Non-GAAP)

7.72

%

1.20

%

17.15

%

11.01

%

4.41

%

17.20

%

 

As Reported

With Exclusions
(Non-GAAP)

Six Months Ended

Six Months Ended

June 30,
2020

June 30,
2019

June 30,
2020

June 30,
2019

Return on average assets

0.32

%

1.45

%

0.59

%

1.45

%

Return on average tangible assets (Non-GAAP)

0.39

%

1.63

%

0.68

%

1.63

%

Return on average equity

2.12

%

8.88

%

3.97

%

8.89

%

Return on average tangible equity (Non-GAAP)

4.49

%

17.28

%

7.94

%

17.30

%

Financial Condition
Total assets were $14.90 billion at June 30, 2020, as compared to $13.40 billion at December 31, 2019. Total loans held for investment were $11.00 billion at June 30, 2020, as compared to $9.69 billion at December 31, 2019. Loans held for investment at June 30, 2020 included $1.28 billion in PPP loans.

Total deposits increased to $11.85 billion at June 30, 2020, from $10.21 billion at December 31, 2019. Non-interest bearing deposits increased $1.19 billion to $3.74 billion, or 31.57% of total deposits, at June 30, 2020, as compared to $2.55 billion, or 24.99% of total deposits, at December 31, 2019. The growth in non-interest bearing deposits during the quarter was primarily driven by the Company’s PPP lending (as loan proceeds are held as Company deposits until the borrower utilizes the funds), Economic Impact Payments provided for in the government stimulus package and core growth.

Continued Focus on Prudent Capital Management
The Company remains committed to maintaining a strong capital and liquidity position, while also serving the needs of its stakeholders during these uncertain times. As previously announced, the Company suspended its stock repurchase program during the first quarter of 2020 in response to the COVID-19 pandemic. There is $5.5 million of repurchase availability remaining under the $50.0 million stock repurchase program, which will remain in effect until the earlier of October 2020 or the repurchase of the entire amount of common stock authorized to be repurchased by the Board of Directors.

At June 30, 2020, Tier 1 leverage capital was 9.12%, Common Equity Tier 1 ratio was 10.69%, Tier 1 risk-based capital ratio was 11.69%, and total risk-based capital ratio was 13.72%. All regulatory ratios exceed the minimums required to be «well-capitalized.»

The Company’s ratio of shareholders’ equity to assets was 13.98% at June 30, 2020, as compared to 15.86% at December 31, 2019. Its tangible capital ratio (non-GAAP) was 7.97% at June 30, 2020, as compared to 9.25% at December 31, 2019.

The PPP loans originated during the quarter and held on the Company’s balance sheet at June 30, 2020, negatively impacted  the Company’s tangible capital ratio by 81 basis points and its leverage ratio by 61 basis points.

Results of Operations
Net interest income was $105.8 million for the second quarter of 2020, as compared to $106.6 million for the first quarter of 2020 and $112.8 million for the second quarter of 2019. Net interest income was $212.4 million for the first half of 2020, as compared to $225.9 million for the first half of 2019.

The Company has continued to experience margin pressure during the second quarter of 2020 as a result of the Federal Reserve’s decision to cut interest rates as well as changes in the mix of earning assets during the quarter due to the excess liquidity on the balance sheet. The Company has continued to focus on lowering the cost of funding by growing noninterest-bearing deposits and aggressively lowering interest rates on interest-bearing deposits, while also continuing to be opportunistic when rates offered on wholesale borrowings are advantageous. The following tables present the percentage of total average earning assets, by type and yield, for the periods presented:

Percentage of Total Average Earning
Assets

Yield

Three Months Ended

Three Months Ended

June 30,

March 31,

June 30,

June 30,

March 31,

June 30,

2020

2020

2019

2020

2020

2019

Loans held for investment excl. PPP loans

76.31

%

83.44

%

82.65

%

4.45

%

4.93

%

5.44

%

PPP loans

6.78

2.73

Loans held for sale

2.67

2.90

3.23

3.51

3.57

5.90

Securities

10.14

11.14

11.54

2.71

2.91

3.04

Other

4.10

2.52

2.58

0.15

1.12

2.59

Total earning assets

100.00

%

100.00

%

100.00

%

3.95

%

4.57

%

5.11

%

 

Percentage of Total Average
Earning Assets

Yield

Six Months Ended

Six Months Ended

June 30,

June 30,

June 30,

June 30,

2020

2019

2020

2019

Loans held for investment excl. PPP loans

79.71

%

82.90

%

4.69

%

5.44

%

PPP loans

3.55

2.73

Loans held for sale

2.78

3.20

3.54

6.37

Securities

10.61

11.52

2.81

3.12

Other

3.35

2.38

0.50

2.55

Total earning assets

100.00

%

100.00

%

4.25

%

5.13

%

The following tables present reported taxable equivalent net interest margin and yield on loans, including loans held for sale, for the periods presented (in thousands).

Three Months Ended

June 30,

March 31,

June 30,

2020

2020

2019

Taxable equivalent net interest income

$

107,457

$

108,316

$

114,223

Average earning assets

$

12,776,644

$

11,609,477

$

10,942,492

Net interest margin

3.38

%

3.75

%

4.19

%

Taxable equivalent interest income on loans

$

116,703

$

121,729

$

127,896

Average loans, including loans held for sale

$

10,956,729

$

10,024,114

$

9,396,891

Loan yield

4.28

%

4.88

%

5.46

%

 

Six Months Ended

June 30,

June 30,

2020

2019

Taxable equivalent net interest income

$

215,773

$

228,854

Average earning assets

$

12,193,061

$

10,918,979

Net interest margin

3.56

%

4.23

%

Taxable equivalent interest income on loans

$

238,432

$

255,102

Average loans, including loans held for sale

$

10,490,422

$

9,400,956

Loan yield

4.57

%

5.47

%

PPP loans reduced margin and loan yield by 5 basis points and 14 basis points, respectively, in the second quarter of 2020 and 3 basis points and 8 basis points, respectively, in the first half of 2020. In addition to the impact of PPP loans on the margin as disclosed above, excess cash carried on the Company’s balance sheet reduced margin by 15 basis points and 9 basis points in the second quarter and first half of 2020, respectively.

The impact from interest income collected on problem loans and purchase accounting adjustments on loans to total interest income on loans, including loans held for sale, loan yield and net interest margin is shown in the following tables for the periods presented (in thousands).

Three Months Ended

June 30,

March 31,

June 30,

2020

2020

2019

Net interest income collected on problem loans

$

384

$

218

$

2,173

Accretable yield recognized on purchased loans(1)

4,700

5,469

7,513

Total impact to interest income

$

5,084

$

5,687

$

9,686

Impact to total loan yield

0.19

%

0.23

%

0.41

%

Impact to net interest margin

0.16

%

0.20

%

0.36

%

(1)

Includes additional interest income recognized in connection with the acceleration of paydowns and payoffs from purchased loans of $1,731, $2,187 and $4,197 for the three months ended June 30, 2020, March 31, 2020, and June 30, 2019, respectively. This additional interest income increased total loan yield by 6 basis points, 9 basis points and 18 basis points for the same periods, respectively, while increasing net interest margin by 5 basis points, 8 basis points and 15 basis points for the same periods, respectively.

 

Six Months Ended

June 30,

June 30,

2020

2019

Net interest income collected on problem loans

$

602

$

2,985

Accretable yield recognized on purchased loans(1)

10,169

15,056

Total impact to interest income

$

10,771

$

18,041

Impact to total loan yield

0.21

%

0.39

%

Impact to net interest margin

0.18

%

0.33

%

(1)

Includes additional interest income recognized in connection with the acceleration of paydowns and payoffs from purchased loans of $3,919 and $8,030 for the six months ended June 30, 2020 and 2019, respectively. This additional interest income increased total loan yield by 8 basis points and 17 basis points for the same periods, respectively, while increasing net interest margin by 6 basis points and 15 basis points for the same periods, respectively.

For the second quarter of 2020, the cost of total deposits was 49 basis points, as compared to 72 basis points for the first quarter of 2020 and 83 basis points for the second quarter of 2019. The cost of total deposits was 60 basis points for the first six months of 2020, as compared to 81 basis points for the same period in 2019. The tables below present, by type, our funding sources and the total cost of each funding source for the periods presented:

Percentage of Total Average Deposits and
Borrowed Funds

Cost of Funds

Three Months Ending

Three Months Ending

June 30,

March 31,

June 30,

June 30,

March 31,

June 30,

2020

2020

2019

2020

2020

2019

Noninterest-bearing demand

27.80

%

23.19

%

22.82

%

%

%

%

Interest-bearing demand

41.64

44.29

45.12

0.43

0.75

0.89

Savings

6.04

6.11

6.14

0.09

0.15

0.20

Time deposits

16.44

18.98

22.56

1.62

1.71

1.72

Borrowed funds

8.08

7.43

3.36

1.73

2.46

4.61

Total deposits and borrowed funds

100.00

%

100.00

%

100.00

%

0.59

%

0.85

%

0.96

%

 

Percentage of Total Average
Deposits and Borrowed Funds

Cost of Funds

Six Months Ending

Six Months Ending

June 30,

June 30,

June 30,

June 30,

2020

2019

2020

2019

Noninterest-bearing demand

25.62

%

22.56

%

%

%

Interest-bearing demand

42.89

45.36

0.59

0.87

Savings

6.07

6.07

0.12

0.20

Time deposits

17.64

22.60

1.66

1.66

Borrowed funds

7.78

3.41

2.06

4.64

Total deposits and borrowed funds

100.00

%

100.00

%

0.71

%

0.94

%

Noninterest income for the second quarter of 2020 was $64.2 million, as compared to $37.6 million for the first quarter of 2020 and $42.0 million for the second quarter of 2019. Noninterest income for the first six months of 2020 was $101.7 million, as compared to $77.8 million for the same period in 2019. Service charges on deposit accounts decreased quarter over quarter due to a decrease in overdraft fees as a result of increased customer liquidity and a decrease in consumer spending due to shutdowns throughout the Company’s footprint. Effective July 1, 2019, the Company became subject to the limitations on interchange fees imposed by the Durbin Amendment under the Dodd-Frank Act, which is reflected in the reduction in fees and commissions on loans and deposits in the first six months of 2020 as compared to the first six months of 2019. Mortgage banking income continued to be a strong source of noninterest income for the Company with mortgage production during the second quarter of 2020 of approximately $1.67 billion and year-to-date production of $3.57 billion. Mortgage banking income was offset by a negative MSR valuation adjustment in both the first and second quarter of 2020. The following tables present the components of mortgage banking income for the periods presented (in thousands):

Three Months Ended

June 30, 2020

March 31, 2020

June 30, 2019

Gain on sales of loans, net

$

46,560

$

21,782

$

12,901

Fees, net

5,309

2,919

2,945

Mortgage servicing income, net

(1,428)

405

774

MSR valuation adjustment

(4,951)

(9,571)

Mortgage banking income, net

$

45,490

$

15,535

$

16,620

 

Six Months Ended

June 30, 2020

June 30, 2019

Gain on sales of loans, net

$

68,342

$

20,789

Fees, net

8,228

4,638

Mortgage servicing income, net

(1,023)

1,594

MSR valuation adjustment

(14,522)

Mortgage banking income, net

$

61,025

$

27,021

Noninterest expense was $118.3 million for the second quarter of 2020, as compared to $115.0 million for the first quarter of 2020 and $93.3 million for the second quarter of 2019. Noninterest expense was $233.3 million for the first six months of 2020, as compared to $182.1 million for the same period in 2019. Salaries and benefits expense was $79.4 million for the second quarter of 2020, which represents an increase of $6.2 million from the previous quarter. Compensation related to the continued elevated mortgage production during the quarter increased $3.2 million dollars on a linked quarter basis. In addition, during the quarter the Company recognized approximately $5.8 million in expense related to elevated overtime and other accruals for employee benefits provided in response to the COVID-19 pandemic. The Company recorded $2.6 million provision for unfunded commitments in other noninterest expense in the second quarter of 2020, as compared to a $3.4 million provision for unfunded commitments in the first quarter of 2020.

Asset Quality Metrics
At June 30, 2020, the Company’s credit quality metrics remained strong.  During the first quarter of 2020, in response to the potential economic impact of COVID-19 the Company proactively identified customers in potentially high-risk industries. The Company placed heightened attention on borrowers in the hospitality (such as hotel/motel), restaurant, entertainment and retail trade (the Company does not have material exposure to the energy industry). The Company is continuing to monitor all asset categories given that any category or borrower could be negatively impacted by the pandemic. To provide necessary relief to the Company’s borrowers – both consumer and commercial clients – the Company established loan deferral programs allowing qualified clients to defer principal and interest payments for up to 90 days. As of June 30, 2020, approximately 21.5% of the Company’s loan portfolio excluding PPP loans was in deferral. The deferral percentage decreased to approximately 13.5% as of July 24, 2020.

The Company’s credit quality in future quarters will potentially be impacted by both external and internal factors.  External factors outside the Company’s control could include items such as federal, state and local government measures, «shelter-in-place» orders, economic impact of government programs and future spread of COVID-19.  Internal factors that will potentially impact credit quality include items such as the Company’s loan deferral programs, involvement in government offered programs and the related financial impact of these programs. The impact of each of these items are unknown at this time and could materially and adversely impact future credit quality.

The table below shows nonperforming assets, which includes nonperforming loans (loans 90 days or more past due and nonaccrual loans) and other real estate owned, as well as early stage delinquencies (loans 30-89 days past due) for the periods presented (in thousands). 

June 30, 2020

December 31, 2019

Non
Purchased

Purchased

Total

Non
Purchased

Purchased

Total

Nonaccrual loans

$

16,591

$

21,361

$

37,952

$

21,509

$

7,038

$

28,547

Loans 90 days past due or more

3,993

2,158

6,151

3,458

4,317

7,775

Nonperforming loans

$

20,584

$

23,519

$

44,103

$

24,967

$

11,355

$

36,322

Other real estate owned

4,694

4,431

9,125

2,762

5,248

8,010

Nonperforming assets

$

25,278

$

27,950

$

53,228

$

27,729

$

16,603

$

44,332

Nonperforming loans/total loans

0.40

%

0.37

%

Nonperforming loans/total loans excluding PPP loans

0.45

%

Nonperforming assets/total assets

0.36

%

0.33

%

Nonperforming assets/total assets excluding PPP loans

0.39

%

Loans 30-89 days past due

$

6,586

$

3,089

$

9,675

$

22,781

$

14,887

$

37,668

Loans 30-89 days past due/total loans

0.09

%

0.39

%

The implementation of CECL on January 1, 2020, which required purchased credit deteriorated loans to be classified as nonaccrual based on performance, contributed approximately $5.3 million as of June 30, 2020 to the increase in purchased nonaccrual loans.

The table below shows the allowance transition from the former incurred loss allowance model at December 31, 2019 through the day one transition to CECL on January 1, 2020 and the subsequent reserve build-up through the first half of 2020 and the ending allowance under the CECL model at June 30, 2020 (in thousands).

December 31, 2019

January 1, 2020

March 31, 2020

June 30, 2020

Incurred Loss
Model

CECL Model 
Day 1

CECL Model

Allowance for credit losses

$

52,162

$

94,647

$

120,185

$

145,387

Reserve for unfunded commitments

946

11,336

14,735

17,335

Total reserves

$

53,108

$

105,983

$

134,920

$

162,722

Allowance for credit losses/total loans

0.54

%

0.98

%

1.23

%

1.32

%

Allowance for credit losses/total loans excluding PPP loans

1.50

%

Reserve for unfunded commitments/total unfunded commitments

0.04

%

0.47

%

0.60

%

0.66

%

The Company recorded a provision for credit losses of $26.9 million and a reserve for unfunded commitments, which is recorded in other noninterest expense, of $2.6 million for the second quarter of 2020. Net loan charge-offs were $1.7 million, or 0.06% of average loans held for investment on an annualized basis. The continued elevated provision is driven by qualitative factors related to the uncertainty concerning the COVID-19 pandemic, with forecasted negative GDP growth and high unemployment rates throughout 2020 and into 2021, and a potential prolonged economic recovery period.

The provision for credit losses recorded during the second quarter of 2019 was $900 thousand with net charge-offs of $676 thousand, or 0.03% of average loans held for sale on an annualized basis. The Company’s coverage ratio, or the allowance for credit losses to nonperforming loans, was 329.65% as of June 30, 2020, as compared to 240.19% as of March 31, 2020 and 143.61% as of December 31, 2019.

CONFERENCE CALL INFORMATION:
A live audio webcast of a conference call with analysts will be available beginning at 10:00 AM Eastern Time on Tuesday, July 28, 2020.

The webcast can be accessed through Renasant’s investor relations website at www.renasant.com or https://services.choruscall.com/links/rnst200722.html. To access the conference via telephone, dial 1-877-513-1143 in the United States and request the Renasant Corporation 2020 Second Quarter and Year-end Earnings Webcast and Conference Call. International participants should dial 1-412-902-4145 to access the conference call.

The webcast will be archived on www.renasant.com beginning one hour after the call and will remain accessible for one year. Replays can also be accessed via telephone by dialing 1-877-344-7529 in the United States and entering conference number 10146378 or by dialing 1-412-317-0088 internationally and entering the same conference number. Telephone replay access is available until August 5, 2020.

ABOUT RENASANT CORPORATION:
Renasant Corporation is the parent of Renasant Bank, a 116-year-old financial services institution. Renasant has assets of approximately $14.9 billion and operates more than 200 banking, mortgage, wealth management and insurance offices in Mississippi, Tennessee, Alabama, Florida and Georgia.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS:

This press release may contain, or incorporate by reference, statements about Renasant Corporation that constitute «forward-looking statements» within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended.  Statements preceded by, followed by or that otherwise include the words «believes,» «expects,» «projects,» «anticipates,» «intends,» «estimates,» «plans,» «potential,» «possible,» «may increase,» «may fluctuate,» «will likely result,» and similar expressions, or future or conditional verbs such as «will,» «should,» «would» and «could,» are generally forward-looking in nature and not historical facts. Forward-looking statements include information about the Company’s future financial performance, business strategy, projected plans and objectives and are based on the current beliefs and expectations of management.  The Company’s management believes these forward-looking statements are reasonable, but they are all inherently subject to significant business, economic and competitive risks and uncertainties, many of which are beyond the Company’s control.  In addition, these forward-looking statements are subject to assumptions with respect to future business strategies and decisions that are subject to change.  Actual results may differ from those indicated or implied in the forward-looking statements, and such differences may be material.  Prospective investors are cautioned that any forward-looking statements are not guarantees of future performance and involve risks and uncertainties and, accordingly, investors should not place undue reliance on these forward-looking statements, which speak only as of the date they are made.  

Currently, the most important factor that could cause the Company’s actual results to differ materially from those in forward-looking statements is the continued impact of the COVID-19 pandemic and related governmental measures to respond to the pandemic on the United States economy and the economies of the markets in which the Company operates.  In this press release, the Company has addressed the historical impact of the pandemic on the operations of the Company and set forth certain expectations regarding the COVID-19 pandemic’s future impact on the Company’s business, financial condition, results of operations, liquidity, asset quality, cash flows and prospects.  The Company believes that its statements regarding future events and conditions in light of the COVID-19 pandemic are reasonable, but these statements are based on assumptions regarding, among other things, how long the pandemic will continue, the duration and extent of the governmental measures implemented to contain the pandemic and ameliorate its impact on businesses and individuals throughout the United States, and the impact of the pandemic and the government’s virus containment measures on national and local economies, all of which are out of the Company’s control.  If the Company’s assumptions underlying its statements about future events prove to be incorrect, the Company’s business, financial condition, results of operations, liquidity, asset quality, cash flows and prospects may be materially different from what is presented in the Company’s forward-looking statements.

Important factors other than the COVID-19 pandemic currently known to management that could cause actual results to differ materially from those in forward-looking statements include the following: (i) the Company’s ability to efficiently integrate acquisitions into its operations, retain the customers of these businesses, grow the acquired operations and realize the cost savings expected from an acquisition to the extent and in the timeframe anticipated by management; (ii) the effect of economic conditions and interest rates on a national, regional or international basis; (iii) timing and success of the implementation of changes in operations to achieve enhanced earnings or effect cost savings; (iv) competitive pressures in the consumer finance, commercial finance, insurance, financial services, asset management, retail banking, mortgage lending and auto lending industries; (v) the financial resources of, and products available from, competitors; (vi) changes in laws and regulations as well as changes in accounting standards, such as the adoption of the CECL model as of January 1, 2020; (vii) changes in policy by regulatory agencies; (viii) changes in the securities and foreign exchange markets; (ix) the Company’s potential growth, including its entrance or expansion into new markets, and the need for sufficient capital to support that growth; (x) changes in the quality or composition of the Company’s loan or investment portfolios, including adverse developments in borrower industries or in the repayment ability of individual borrowers; (xi) an insufficient allowance for credit losses as a result of inaccurate assumptions; (xii) general economic, market or business conditions, including the impact of inflation; (xiii) changes in demand for loan products and financial services; (xiv) concentration of credit exposure; (xv) changes or the lack of changes in interest rates, yield curves and interest rate spread relationships; (xvi) increased cybersecurity risk, including potential network breaches, business disruptions or financial losses; (xvii) natural disasters, epidemics and other catastrophic events in the Company’s geographic area; (xviii) the impact, extent and timing of technological changes; and (xix) other circumstances, many of which are beyond management’s control.  The COVID-19 pandemic has exacerbated, and is likely to continue to exacerbate, the impact of any of these factors on the Company.  Management believes that the assumptions underlying the Company’s forward-looking statements are reasonable, but any of the assumptions could prove to be inaccurate. Investors are urged to carefully consider the risks described in the Company’s filings with the Securities and Exchange Commission (the «SEC») from time to time, including its most recent Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q, which are available at www.renasant.com and the SEC’s website at www.sec.gov.

The Company undertakes no obligation, and specifically disclaims any obligation, to update or revise forward-looking statements, whether as a result of new information or to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results over time, except as required by federal securities laws.

NON-GAAP FINANCIAL MEASURES:

In addition to results presented in accordance with generally accepted accounting principles in the United States of America (GAAP), this press release contains non-GAAP financial measures, namely, return on average tangible shareholders’ equity, return on average tangible assets, the ratio of tangible equity to tangible assets (commonly referred to as the «tangible capital ratio»), tangible book value per share and the adjusted efficiency ratio. These non-GAAP financial measures adjust GAAP financial measures to exclude intangible assets and/or certain charges (such as, when applicable, COVID-19 related expenses, merger and conversion expenses, debt prepayment penalties and asset valuation adjustments) with respect to which the Company is unable to accurately predict when these charges will be incurred or, when incurred, the amount thereof. With respect to COVID-19 related expenses in particular, management added these expenses as a charge to exclude when calculating non-GAAP financial measures because the expenses included within this line item (as discussed earlier in this release) were readily quantifiable and possess the same characteristics with respect to management’s inability to accurately predict the timing or amount thereof as the other charges excluded when calculating non-GAAP financial measures. Management uses these non-GAAP financial measures when evaluating capital utilization and adequacy. In addition, the Company believes that these non-GAAP financial measures facilitate the making of period-to-period comparisons and are meaningful indicators of its operating performance, particularly because these measures are widely used by industry analysts for companies with merger and acquisition activities. Also, because intangible assets such as goodwill and the core deposit intangible and charges such as merger and conversion expenses and COVID-19 related charges can vary extensively from company to company and, as to intangible assets, are excluded from the calculation of a financial institution’s regulatory capital, the Company believes that the presentation of this non-GAAP financial information allows readers to more easily compare the Company’s results to information provided in other regulatory reports and the results of other companies. Reconciliations of these other non-GAAP financial measures to the most directly comparable GAAP financial measures are included in the table at the end of this release under the caption «Reconciliation of GAAP to Non-GAAP.»

None of the non-GAAP financial information that the Company has included in this release is intended to be considered in isolation or as a substitute for any measure prepared in accordance with GAAP. Investors should note that, because there are no standardized definitions for the calculations as well as the results, the Company’s calculations may not be comparable to similarly titled measures presented by other companies. Also, there may be limits in the usefulness of these measures to investors. As a result, the Company encourages readers to consider its consolidated financial statements in their entirety and not to rely on any single financial measure.

Contacts:

For Media:

For Financials:

John Oxford

Kevin Chapman

Senior Vice President

Executive Vice President

Director of Marketing and Public Relations

Chief Operating and Financial Officer

(662) 680-1219

(662) 680-1450

[email protected]

[email protected]

 

RENASANT CORPORATION

(Unaudited)

(Dollars in thousands, except per share data)

Q2 2020- 

For The Six Months Ending

2020

2019

Q2 2019

June 30,

Second

First

Fourth

Third

Second

First

Percent

Percent

Quarter

Quarter

Quarter

Quarter

Quarter

Quarter

Variance

2020

2019

Variance

Statement of earnings

Interest income – taxable equivalent basis

$

125,630

$

131,887

$

135,119

$

135,927

$

139,285

$

138,578

(9.80)

%

$

257,517

$

277,863

(7.32)

%

Interest income

$

123,955

$

130,173

$

133,148

$

134,476

$

137,862

$

137,094

(10.09)

$

254,128

$

274,956

(7.58)

Interest expense

18,173

23,571

24,263

25,651

25,062

23,947

(27.49)

41,744

49,009

(14.82)

Net interest income

105,782

106,602

108,885

108,825

112,800

113,147

(6.22)

212,384

225,947

(6.00)

Provision for loan losses

26,900

26,350

2,950

1,700

900

1,500

2,888.89

53,250

2,400

2,118.75

Net interest income after provision

78,882

80,252

105,935

107,125

111,900

111,647

(29.51)

159,134

223,547

(28.81)

Service charges on deposit accounts

6,832

9,070

9,273

8,992

8,605

9,102

(20.60)

15,902

17,707

(10.19)

Fees and commissions on loans and deposits

2,971

3,054

2,822

3,090

7,047

6,471

(57.84)

6,025

13,518

(55.43)

Insurance commissions and fees

2,125

1,991

2,105

2,508

2,190

2,116

(2.97)

4,116

4,306

(4.41)

Wealth management revenue

3,824

4,002

3,920

3,588

3,601

3,324

6.19

7,826

6,925

13.01

Securities gains (losses)

31

343

-8

13

(487.50)

31

5

520.00

Mortgage banking income

45,490

15,535

15,165

15,710

16,620

10,401

173.71

61,025

27,021

125.84

Other

2,897

3,918

4,171

3,722

3,905

4,458

(25.81)

6,815

8,363

(18.51)

Total noninterest income

64,170

37,570

37,456

37,953

41,960

35,885

52.93

101,740

77,845

30.70

Salaries and employee benefits

79,361

73,189

67,684

65,425

60,325

57,350

31.56

152,550

117,675

29.64

Data processing

5,047

5,006

5,095

4,980

4,698

4,906

7.43

10,053

9,604

4.68

Occupancy and equipment

13,511

14,120

13,231

12,943

11,544

11,835

17.04

27,631

23,379

18.19

Other real estate

620

418

339

418

252

1,004

146.03

1,038

1,256

(17.36)

Amortization of intangibles

1,834

1,895

1,946

1,996

2,053

2,110

(10.67)

3,729

4,163

(10.43)

Merger and conversion related expenses

76

24

179

(100.00)

179

Debt extinguishment penalty

90

54

100.00

90

100.00

Other

17,822

20,413

7,181

10,660

14,239

11,627

25.16

38,235

25,866

47.82

Total noninterest expense

118,285

115,041

95,552

96,500

93,290

88,832

26.79

233,326

182,122

28.12

Income before income taxes

24,767

2,781

47,839

48,578

60,570

58,700

(59.11)

27,548

119,270

(53.07)

Income taxes

4,637

773

9,424

11,132

13,945

13,590

(66.75)

5,410

27,535

(80.35)

Net income

$

20,130

$

2,008

$

38,415

$

37,446

$

46,625

$

45,110

(56.83)

$

22,138

$

91,735

(28.97)

Basic earnings per share

$

0.36

$

0.04

$

0.67

$

0.65

$

0.80

$

0.77

(55.00)

$

0.39

$

1.57

(75.16)

Diluted earnings per share

0.36

0.04

0.67

0.64

0.80

0.77

(55.00)

0.39

1.56

(75.00)

Average basic shares outstanding

56,165,452

56,534,816

57,153,160

58,003,215

58,461,024

58,585,517

(3.93)

56,350,134

58,523,007

(3.71)

Average diluted shares outstanding

56,325,476

56,706,289

57,391,876

58,192,419

58,618,976

58,730,535

(3.91)

56,514,599

58,669,056

(3.67)

Common shares outstanding

56,181,962

56,141,018

56,855,002

57,455,306

58,297,670

58,633,630

(3.63)

56,181,962

58,297,670

(3.63)

Cash dividend per common share

$

0.22

$

0.22

$

0.22

$

0.22

$

0.22

$

0.21

$

0.44

$

0.43

2.33

Performance ratios

Return on avg shareholders’ equity

3.85

%

0.38

%

7.15

%

6.97

%

8.90

%

8.86

%

2.12

%

8.88

%

Return on avg tangible s/h’s equity (non-GAAP) (1)

7.72

%

1.20

%

13.75

%

13.38

%

17.15

%

17.41

%

4.49

%

17.28

%

Return on avg assets

0.55

%

0.06

%

1.16

%

1.16

%

1.47

%

1.44

%

0.32

%

1.45

%

Return on avg tangible assets (non-GAAP)(2)

0.63

%

0.11

%

1.30

%

1.30

%

1.64

%

1.61

%

0.39

%

1.63

%

Net interest margin (FTE)

3.38

%

3.75

%

3.90

%

3.98

%

4.19

%

4.27

%

3.56

%

4.23

%

Yield on earning assets (FTE)

3.95

%

4.57

%

4.75

%

4.91

%

5.11

%

5.16

%

4.25

%

5.13

%

Cost of funding

0.59

%

0.85

%

0.89

%

0.97

%

0.96

%

0.92

%

0.71

%

0.94

%

Average earning assets to average assets

86.88

%

86.17

%

85.71

%

85.58

%

85.72

%

85.58

%

86.54

%

85.65

%

Average loans to average deposits

93.35

%

93.83

%

92.43

%

89.13

%

89.13

%

89.33

%

93.58

%

89.23

%

Noninterest income (less securities gains/

losses) to average assets

1.75

%

1.12

%

1.13

%

1.16

%

1.32

%

1.14

%

1.45

%

1.23

%

Noninterest expense (less debt prepayment penalties/

penalties/merger-related expenses) to

average assets

3.23

%

3.43

%

2.88

%

2.98

%

2.93

%

2.83

%

3.33

%

2.88

%

Net overhead ratio

1.48

%

2.31

%

1.75

%

1.82

%

1.61

%

1.69

%

1.88

%

1.65

%

Efficiency ratio (FTE)

68.92

%

78.86

%

64.43

%

65.10

%

59.73

%

59.02

%

73.49

%

59.38

%

Adjusted efficiency ratio (FTE) (non-GAAP) (4)

60.89

%

68.73

%

63.62

%

62.53

%

58.30

%

57.62

%

64.56

%

57.97

%

RENASANT CORPORATION

(Unaudited)

(Dollars in thousands, except per share data)

Q2 2020 –

As of

2020

2019

Q2 2019

June 30,

Second

First

Fourth

Third

Second

First

Percent

Percent

Quarter

Quarter

Quarter

Quarter

Quarter

Quarter

Variance

2020

2019

Variance

Average Balances

Total assets

$

14,706,027

$

13,472,550

$

13,157,843

$

12,846,131

$

12,764,669

$

12,730,939

15.21

%

$

14,089,289

$

12,747,897

10.52

%

Earning assets

12,776,643

11,609,477

11,277,000

10,993,645

10,942,492

10,895,205

16.76

12,193,058

10,918,979

11.67

Securities

1,295,539

1,292,875

1,234,718

1,227,678

1,262,271

1,253,224

2.64

1,294,207

1,257,772

2.90

Loans held for sale

340,582

336,829

350,783

385,437

353,103

345,264

(3.55)

338,706

349,205

(3.01)

Loans, net of unearned

10,616,147

9,687,285

9,457,658

9,109,252

9,043,788

9,059,802

17.39

10,151,716

9,051,751

12.15

Intangibles

974,237

975,933

977,506

975,306

974,628

976,820

(0.04)

975,085

975,718

(0.06)

Noninterest-bearing deposits

3,439,634

2,586,963

2,611,265

2,500,810

2,395,899

2,342,406

43.56

3,013,298

2,369,300

27.18

Interest-bearing deposits

7,933,035

7,737,615

7,620,602

7,719,510

7,750,986

7,799,892

2.35

7,835,324

7,775,304

0.77

Total deposits

11,372,669

10,324,578

10,231,867

10,220,320

10,146,885

10,142,298

12.08

10,848,622

10,144,604

6.94

Borrowed funds

1,000,789

829,320

596,101

308,931

354,234

363,140

182.52

915,054

358,662

155.13

Shareholders’ equity

2,101,092

2,105,143

2,131,342

2,131,537

2,102,093

2,065,370

(0.05)

2,103,118

2,083,833

0.93

Q2 2020 –

As of

2020

2019

Q4 2019

June 30,

Second

First

Fourth

Third

Second

First

Percent

Percent

Quarter

Quarter

Quarter

Quarter

Quarter

Quarter

Variance

2020

2019

Variance

Balances at period end

Total assets

$

14,897,207

$

13,890,550

$

13,400,618

$

13,039,674

$

12,892,653

$

12,862,395

11.17

%

$

14,897,207

$

12,892,653

15.55

%

Earning assets

13,041,846

11,970,492

11,522,388

11,145,052

11,064,957

11,015,535

13.19

13,041,846

11,064,957

17.87

Securities

1,303,494

1,359,129

1,290,613

1,238,577

1,268,280

1,255,353

1.00

1,303,494

1,268,280

2.78

Loans held for sale

339,747

448,797

318,272

392,448

461,681

318,563

6.75

339,747

461,681

(26.41)

Non purchased loans

9,206,101

7,802,404

7,587,974

7,031,818

6,704,288

6,565,599

21.32

9,206,101

6,704,288

37.32

Purchased loans

1,791,203

1,966,973

2,101,664

2,281,966

2,350,366

2,522,694

(14.77)

1,791,203

2,350,366

(23.79)

Total loans

10,997,304

9,769,377

9,689,638

9,313,784

9,054,654

9,088,293

13.50

10,997,304

9,054,654

21.45

Intangibles

973,214

975,048

976,943

978,390

973,673

975,726

(0.38)

973,214

973,673

(0.05)

Noninterest-bearing deposits

3,740,296

2,642,059

2,551,770

2,607,056

2,408,984

2,366,223

46.58

3,740,296

2,408,984

55.26

Interest-bearing deposits

8,106,062

7,770,367

7,661,398

7,678,980

7,781,077

7,902,689

5.80

8,106,062

7,781,077

4.18

Total deposits

11,846,358

10,412,426

10,213,168

10,286,036

10,190,061

10,268,912

15.99

11,846,358

10,190,061

16.25

Borrowed funds

718,490

1,169,631

865,598

433,705

401,934

350,859

(16.99)

718,490

401,934

78.76

Shareholders’ equity

2,082,946

2,070,512

2,125,689

2,119,659

2,119,696

2,088,877

(2.01)

2,082,946

2,119,696

(1.73)

Market value per common share

24.90

21.84

35.42

35.01

35.94

33.85

(29.70)

24.90

35.94

(30.72)

Book value per common share

37.07

36.88

37.39

36.89

36.36

35.63

(0.85)

37.07

36.36

1.95

Tangible book value per common share

19.75

19.51

20.20

19.86

19.66

18.98

(2.25)

19.75

19.66

0.46

Shareholders’ equity to assets (actual)

13.98

%

14.91

%

15.86

%

16.26

%

16.44

%

16.24

%

13.98

%

16.44

%

Tangible capital ratio (non-GAAP)(3)

7.97

%

8.48

%

9.25

%

9.46

%

9.62

%

9.36

%

7.97

%

9.62

%

Leverage ratio

9.12

%

9.90

%

10.37

%

10.56

%

10.65

%

10.44

%

9.12

%

10.65

%

Common equity tier 1 capital ratio

10.69

%

10.63

%

11.12

%

11.36

%

11.64

%

11.49

%

10.69

%

11.64

%

Tier 1 risk-based capital ratio

11.69

%

11.63

%

12.14

%

12.40

%

12.69

%

12.55

%

11.69

%

12.69

%

Total risk-based capital ratio

13.72

%

13.44

%

13.78

%

14.07

%

14.62

%

14.57

%

13.72

%

14.62

%

RENASANT CORPORATION

(Unaudited)

(Dollars in thousands, except per share data)

Q2 2020 –

As of

2020

2019

Q4 2019

June 30,

Second

First

Fourth

Third

Second

First

Percent

Percent

Quarter

Quarter

Quarter

Quarter

Quarter

Quarter

Variance

2020

2019

Variance

Non purchased loans

Commercial, financial, agricultural

$

1,134,965

$

1,144,004

$

1,052,353

$

988,867

$

930,598

$

921,081

7.85

%

$

1,134,965

$

930,598

21.96

%

SBA Paycheck  Protection Program

1,281,278

100.00

1,281,278

100.00

Lease financing

80,779

84,679

81,875

69,953

59,158

58,651

(1.34)

80,779

59,158

36.55

Real estate- construction

756,872

745,066

774,901

764,589

716,129

651,119

(2.33)

756,872

716,129

5.69

Real estate – 1-4 family mortgages

2,342,987

2,356,627

2,350,126

2,235,908

2,160,617

2,114,908

(0.30)

2,342,987

2,160,617

8.44

Real estate – commercial mortgages

3,400,718

3,242,172

3,128,876

2,809,470

2,741,402

2,726,186

8.69

3,400,718

2,741,402

24.05

Installment loans to individuals

208,502

229,856

199,843

163,031

96,384

93,654

4.33

208,502

96,384

116.32

Loans, net of unearned

$

9,206,101

$

7,802,404

$

7,587,974

$

7,031,818

$

6,704,288

$

6,565,599

21.32

$

9,206,101

$

6,704,288

37.32

Purchased loans

Commercial, financial, agricultural

$

225,355

$

280,572

$

315,619

$

339,693

$

374,478

$

387,376

(28.60)

$

225,355

$

374,478

(39.82)

Real estate- construction

34,236

42,829

51,582

52,106

65,402

89,954

(33.63)

34,236

65,402

(47.65)

Real estate – 1-4 family mortgages

445,526

489,674

516,487

561,725

604,855

654,265

(13.74)

445,526

604,855

(26.34)

Real estate – commercial mortgages

1,010,035

1,066,536

1,115,389

1,212,905

1,276,567

1,357,446

(9.45)

1,010,035

1,276,567

(20.88)

Installment loans to individuals

76,051

87,362

102,587

115,537

29,064

33,653

(25.87)

76,051

29,064

161.67

Loans, net of unearned

$

1,791,203

$

1,966,973

$

2,101,664

$

2,281,966

$

2,350,366

$

2,522,694

(14.77)

$

1,791,203

$

2,350,366

(23.79)

Asset quality data

Non purchased assets

Nonaccrual loans

$

16,591

$

21,384

$

21,509

$

15,733

$

14,268

$

12,507

(22.86)

$

16,591

$

14,268

16.28

Loans 90 past due or more

3,993

4,459

3,458

7,325

4,175

1,192

15.47

3,993

4,175

(4.36)

Nonperforming loans

20,584

25,843

24,967

23,058

18,443

13,699

(17.56)

20,584

18,443

11.61

Other real estate owned

4,694

3,241

2,762

1,975

3,475

4,223

69.95

4,694

3,475

35.08

Nonperforming assets

$

25,278

$

29,084

$

27,729

$

25,033

$

21,918

$

17,922

(8.84)

$

25,278

$

21,918

15.33

Purchased assets

Nonaccrual loans

$

21,361

$

19,090

$

7,038

$

6,123

$

7,250

$

7,828

203.51

$

21,361

$

7,250

194.63

Loans 90 past due or more

2,158

5,104

4,317

7,034

7,687

5,436

(50.01)

2,158

7,687

(71.93)

Nonperforming loans

23,519

24,194

11,355

13,157

14,937

13,264

107.12

23,519

14,937

57.45

Other real estate owned

4,431

5,430

5,248

6,216

5,258

5,932

(15.57)

4,431

5,258

(15.73)

Nonperforming assets

$

27,950

$

29,624

$

16,603

$

19,373

$

20,195

$

19,196

68.34

$

27,950

$

20,195

38.40

Net loan charge-offs (recoveries)

$

1,698

$

811

$

1,602

$

945

$

676

$

691

5.99

$

2,509

$

1,367

83.54

Allowance for loan losses

$

145,387

$

120,185

$

52,162

$

50,814

$

50,059

$

49,835

178.72

$

145,387

$

50,059

190.43

Annualized net loan charge-offs / average loans

0.06

%

0.03

%

0.07

%

0.04

%

0.03

%

0.03

%

0.05

%

0.03

%

Nonperforming loans / total loans*

0.40

%

0.51

%

0.37

%

0.39

%

0.37

%

0.30

%

0.40

%

0.37

%

Nonperforming assets / total assets*

0.36

%

0.42

%

0.33

%

0.34

%

0.33

%

0.29

%

0.36

%

0.33

%

Allowance for loan losses / total loans*

1.32

%

1.23

%

0.54

%

0.55

%

0.55

%

0.55

%

1.32

%

0.55

%

Allowance for loan losses / nonperforming loans*

329.65

%

240.19

%

143.61

%

140.31

%

149.97

%

184.83

%

329.65

%

149.97

%

Nonperforming loans / total loans**

0.22

%

0.33

%

0.33

%

0.33

%

0.28

%

0.21

%

0.22

%

0.28

%

Nonperforming assets / total assets**

0.17

%

0.21

%

0.21

%

0.19

%

0.17

%

0.14

%

0.17

%

0.17

%

*Based on all assets (includes purchased assets)

**Excludes all purchased assets

 

RENASANT CORPORATION

(Unaudited)

(Dollars in thousands, except per share data)

Three Months Ending

For The Six Months Ending

June 30, 2020

March 31, 2020

June 30, 2019

June 30, 2020

June 30, 2019

Average

Interest

Yield/  

Average

Interest

Yield/  

Average

Interest

Yield/  

Average

Interest

Yield/  

Average

Interest

Yield/  

Balance

Income/

 Rate

Balance

Income/

 Rate

Balance

Income/

 Rate

Balance

Income/

 Rate

Balance

Income/

 Rate

Expense

Expense

Expense

Expense

Expense

Assets

Interest-earning assets:

Loans

Non purchased

$

7,872,371

$

81,836

4.18

%

$

7,654,662

$

88,554

4.65

%

$

6,622,202

$

83,922

5.08

%

$

7,763,516

$

170,390

4.41

%

$

6,538,998

$

165,106

5.09

%

Purchased

1,877,698

26,005

5.57

%

2,032,623

30,187

5.97

%

2,421,586

38,783

6.42

%

1,955,161

56,192

5.78

%

2,512,753

78,968

6.34

%

SBA Paycheck Protection Program

866,078

5,886

2.73

%

%

%

433,039

5,886

2.73

%

%

Total loans

10,616,147

113,727

4.31

%

9,687,285

118,741

4.93

%

9,043,788

122,705

5.44

%

10,151,716

232,468

4.61

%

9,051,751

244,074

5.44

%

Loans held for sale

340,582

2,976

3.51

%

336,829

2,988

3.57

%

353,103

5,191

5.90

%

338,706

5,964

3.54

%

349,205

11,028

6.37

%

Securities:

Taxable(1)

1,031,740

6,386

2.49

%

1,067,274

7,289

2.75

%

1,084,736

7,699

2.85

%

1,049,507

13,675

2.62

%

1,073,422

15,591

2.93

%

Tax-exempt

263,799

2,346

3.58

%

225,601

2,058

3.67

%

177,535

1,860

4.20

%

244,700

4,404

3.62

%

184,350

3,882

4.25

%

Total securities

1,295,539

8,732

2.71

%

1,292,875

9,347

2.91

%

1,262,271

9,559

3.04

%

1,294,207

18,079

2.81

%

1,257,772

19,473

3.12

%

Interest-bearing balances with banks

524,376

195

0.15

%

292,488

811

1.12

%

283,330

1,830

2.59

%

408,432

1,006

0.50

%

260,251

3,288

2.55

%

Total interest-earning assets

12,776,644

125,630

3.95

%

11,609,477

131,887

4.57

%

10,942,492

139,285

5.11

%

12,193,061

257,517

4.25

%

10,918,979

277,863

5.13

%

Cash and due from banks

214,079

186,317

178,606

200,198

185,198

Intangible assets

974,237

975,933

974,628

975,085

975,718

Other assets

741,067

700,823

668,943

720,945

668,002

Total assets

$

14,706,027

$

13,472,550

$

12,764,669

$

14,089,289

$

12,747,897

Liabilities and shareholders’ equity

Interest-bearing liabilities:

Deposits:

Interest-bearing demand(2)

$

5,151,713

$

5,524

0.43

%

$

4,939,757

$

9,253

0.75

%

$

4,737,780

$

10,495

0.89

%

$

5,045,735

$

14,777

0.59

%

$

4,763,837

$

20,569

0.87

%

Savings deposits

747,173

173

0.09

%

681,182

252

0.15

%

644,540

329

0.20

%

714,177

426

0.12

%

637,644

621

0.20

%

Time deposits

2,034,149

8,174

1.62

%

2,116,676

8,989

1.71

%

2,368,666

10,167

1.72

%

2,075,412

17,163

1.66

%

2,373,823

19,573

1.66

%

Total interest-bearing deposits

7,933,035

13,871

0.70

%

7,737,615

18,494

0.96

%

7,750,986

20,991

1.09

%

7,835,324

32,366

0.83

%

7,775,304

40,763

1.06

%

Borrowed funds

1,000,789

4,302

1.73

%

829,320

5,077

2.46

%

354,234

4,071

4.61

%

915,054

9,378

2.06

%

358,662

8,246

4.64

%

Total interest-bearing liabilities

8,933,824

18,173

0.82

%

8,566,935

23,571

1.11

%

8,105,220

25,062

1.24

%

8,750,378

41,744

0.96

%

8,133,966

49,009

1.22

%

Noninterest-bearing deposits

3,439,634

2,586,963

2,395,899

3,013,298

2,369,300

Other liabilities

231,477

213,509

161,457

222,495

160,798

Shareholders’ equity

2,101,092

2,105,143

2,102,093

2,103,118

2,083,833

Total liabilities and shareholders’ equity

$

14,706,027

$

13,472,550

$

12,764,669

$

14,089,289

$

12,747,897

Net interest income/ net interest margin

$

107,457

3.38

%

$

108,316

3.75

%

$

114,223

4.19

%

$

215,773

3.56

%

$

228,854

4.23

%

Cost of funding

0.59

%

0.85

%

0.96

%

0.71

%

0.94

%

Cost of total deposits

0.49

%

0.72

%

0.83

%

0.60

%

0.81

%

(1)U.S. Government and some U.S. Government Agency securities are tax-exempt in the states in which we operate.

(2)Interest-bearing demand deposits include interest-bearing transactional accounts and money market deposits.

 

RENASANT CORPORATION

(Unaudited)

(Dollars in thousands, except per share data)

RECONCILIATION OF GAAP TO NON-GAAP

Six Months Ended

2020

2019

June 30,

Second

First

Fourth

Third

Second

First

Quarter

Quarter

Quarter

Quarter

Quarter

Quarter

2020

2019

Net income (GAAP)

$

20,130

$

2,008

$

38,415

$

37,446

$

46,625

$

45,110

$

22,138

$

91,735

Amortization of intangibles

1,834

1,895

1,946

1,996

2,053

2,110

3,729

4,163

Tax effect of adjustment noted above (A)

(335)

(527)

(383)

(457)

(473)

(488)

(690)

(961)

Tangible net income (non-GAAP)

$

21,629

$

3,376

$

39,978

$

38,985

$

48,205

$

46,732

$

25,177

$

94,937

Net income (GAAP)

$

20,130

$

2,008

$

38,415

$

37,446

$

46,625

$

45,110

$

22,138

$

91,735

Merger & conversion expenses

76

24

179

179

Debt prepayment penalties

90

54

90

MSR valuation adjustment

4,951

9,571

(1,296)

3,132

14,522

COVID-19 related expenses

6,257

2,903

9,160

Tax effect of adjustment noted above (A)

(2,065)

(3,467)

241

(736)

(41)

(4,398)

(41)

Net income with exclusions (non-GAAP)

$

29,363

$

11,015

$

37,436

$

39,920

$

46,763

$

45,110

$

41,512

$

91,873

Average shareholders’ equity (GAAP)

$

2,101,092

$

2,105,143

$

2,131,342

$

2,131,537

$

2,102,093

$

2,065,370

$

2,103,118

$

2,083,833

Intangibles

974,237

975,933

977,506

975,306

974,628

976,820

975,085

975,718

Average tangible s/h’s equity (non-GAAP)

$

1,126,855

$

1,129,210

$

1,153,836

$

1,156,231

$

1,127,465

$

1,088,550

$

1,128,033

$

1,108,115

Average total assets (GAAP)

$

14,706,027

$

13,472,550

$

13,157,843

$

12,846,131

$

12,764,669

$

12,730,939

$

14,089,289

$

12,747,897

Intangibles

974,237

975,933

977,506

975,306

974,628

976,820

975,085

975,718

Average tangible assets (non-GAAP)

$

13,731,790

$

12,496,617

$

12,180,337

$

11,870,825

$

11,790,041

$

11,754,119

$

13,114,204

$

11,772,179

Actual shareholders’ equity (GAAP)

$

2,082,946

$

2,070,512

$

2,125,689

$

2,119,659

$

2,119,696

$

2,088,877

$

2,082,946

$

2,119,696

Intangibles

973,214

975,048

976,943

978,390

973,673

975,726

973,214

973,673

Actual tangible s/h’s equity (non-GAAP)

$

1,109,732

$

1,095,464

$

1,148,746

$

1,141,269

$

1,146,023

$

1,113,151

$

1,109,732

$

1,146,023

Actual total assets (GAAP)

$

14,897,207

$

13,890,550

$

13,400,618

$

13,039,674

$

12,892,653

$

12,862,395

$

14,897,207

$

12,892,653

Intangibles

973,214

975,048

976,943

978,390

973,673

975,726

973,214

973,673

Actual tangible assets (non-GAAP)

$

13,923,993

$

12,915,502

$

12,423,675

$

12,061,284

$

11,918,980

$

11,886,669

$

13,923,993

$

11,918,980

(A) Tax effect is calculated based on respective periods effective tax rate. 

 

RENASANT CORPORATION

(Unaudited)

(Dollars in thousands, except per share data)

RECONCILIATION OF GAAP TO NON-GAAP

Six Months Ended

2020

2019

June 30,

Second

First

Fourth

Third

Second

First

Quarter

Quarter

Quarter

Quarter

Quarter

Quarter

2020

2019

(1) Return on Average Equity

Return on avg s/h’s equity (GAAP)

3.85

%

0.38

%

7.15

%

6.97

%

8.90

%

8.86

%

2.12

%

8.88

%

Effect of adjustment for intangible assets

3.87

%

0.82

%

6.60

%

6.41

%

8.25

%

8.55

%

2.37

%

8.40

%

Return on avg tangible s/h’s equity (non-GAAP)

7.72

%

1.20

%

13.75

%

13.38

%

17.15

%

17.41

%

4.49

%

17.28

%

Return on avg s/h’s equity (GAAP)

3.85

%

0.38

%

7.15

%

6.97

%

8.90

%

8.86

%

2.12

%

8.88

%

Effect of exclusions from net income

1.77

%

1.72

%

-0.18

%

0.46

%

0.02

%

%

1.85

%

0.01

%

Return on avg s/h’s equity with excl. (non-GAAP)

5.62

%

2.10

%

6.97

%

7.43

%

8.92

%

8.86

%

3.97

%

8.89

%

Effect of adjustment for intangible assets

5.40

%

2.31

%

6.44

%

6.80

%

8.28

%

8.55

%

3.97

%

8.41

%

Return on avg tangible s/h’s equity with exclusions (non-GAAP)

11.02

%

4.41

%

13.41

%

14.23

%

17.20

%

17.41

%

7.94

%

17.30

%

(2) Return on Average Assets

Return on avg assets (GAAP)

0.55

%

0.06

%

1.16

%

1.16

%

1.47

%

1.44

%

0.32

%

1.45

%

Effect of adjustment for intangible assets

0.08

%

0.05

%

0.14

%

0.14

%

0.17

%

0.17

%

0.07

%

0.18

%

Return on avg tangible assets (non-GAAP)

0.63

%

0.11

%

1.30

%

1.30

%

1.64

%

1.61

%

0.39

%

1.63

%

Return on avg assets (GAAP)

0.55

%

0.06

%

1.16

%

1.16

%

1.47

%

1.44

%

0.32

%

1.45

%

Effect of exclusions from net income

0.25

%

0.27

%

-0.03

%

0.07

%

%

%

0.27

%

%

Return on avg assets with exclusions (non-GAAP)

0.80

%

0.33

%

1.13

%

1.23

%

1.47

%

1.44

%

0.59

%

1.45

%

Effect of adjustment for intangible assets

0.10

%

0.07

%

0.14

%

0.16

%

0.17

%

0.17

%

0.09

%

0.18

%

Return on avg tangible assets with exclusions (non-GAAP)

0.90

%

0.40

%

1.27

%

1.39

%

1.64

%

1.61

%

0.68

%

1.63

%

(3) Shareholder Equity Ratio 

Shareholders’ equity to actual assets (GAAP)

13.98

%

14.91

%

15.86

%

16.26

%

16.44

%

16.24

%

13.98

%

16.44

%

Effect of adjustment for intangible assets

6.01

%

6.43

%

6.61

%

6.80

%

6.82

%

6.88

%

6.01

%

6.82

%

Tangible capital ratio (non-GAAP)

7.97

%

8.48

%

9.25

%

9.46

%

9.62

%

9.36

%

7.97

%

9.62

%

 

RENASANT CORPORATION

(Unaudited)

(Dollars in thousands, except per share data)

Six Months Ended

2020

2019

June 30,

Second

First

Fourth

Third

Second

First

Quarter

Quarter

Quarter

Quarter

Quarter

Quarter

2020

2019

Interest income (FTE)

$

125,630

$

131,887

$

135,119

$

135,927

$

139,285

$

138,578

$

257,517

$

277,863

Interest expense

18,173

23,571

24,263

25,651

25,062

23,947

41,744

49,009

Net Interest income (FTE)

$

107,457

$

108,316

$

110,856

$

110,276

$

114,223

$

114,631

$

215,773

$

228,854

Total noninterest income 

$

64,170

$

37,570

$

37,456

$

37,953

$

41,960

$

35,885

$

101,740

$

77,845

Securities gains (losses) 

31

343

(8)

13

31

5

MSR valuation adjustment

(4,951)

(9,571)

1,296

(3,132)

(14,522)

Total adjusted noninterest income 

$

69,090

$

47,141

$

36,160

$

40,742

$

41,968

$

35,872

$

116,231

$

77,840

Total noninterest expense

$

118,285

$

115,041

$

95,552

$

96,500

$

93,290

$

88,832

$

233,326

$

182,122

Amortization of intangibles

1,834

1,895

1,946

1,996

2,053

2,110

3,729

4,163

Merger-related expenses

76

24

179

179

Debt extinguishment penalty

90

54

90

COVID-19 related expenses

6,257

2,903

9,160

Provision for unfunded commitments

2,600

3,400

6,000

Total adjusted noninterest expense 

$

107,504

$

106,843

$

93,530

$

94,426

$

91,058

$

86,722

$

214,347

$

177,780

Efficiency Ratio (GAAP)

68.92

%

78.86

%

64.43

%

65.10

%

59.73

%

59.02

%

73.49

%

59.38

%

(4) Adjusted Efficiency Ratio (non-GAAP)

60.89

%

68.73

%

63.62

%

62.53

%

58.30

%

57.62

%

64.56

%

57.97

%

 

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SOURCE Renasant Corporation