• Renasant Corporation Announces Earnings For the First Quarter of 2022

    Источник: Nasdaq GlobeNewswire / 26 апр 2022 16:15:01   America/New_York

    TUPELO, Miss., April 26, 2022 (GLOBE NEWSWIRE) -- Renasant Corporation (NASDAQ: RNST) (the “Company”) today announced earnings results for the first quarter of 2022. Net income for the first quarter of 2022 was $33.5 million, as compared to $57.9 million for the first quarter of 2021. Basic and diluted earnings per share (“EPS”) were $0.60 for the first quarter of 2022, as compared to basic and diluted EPS of $1.03 and $1.02, respectively, for the first quarter of 2021.

    “Our first quarter results were highlighted by strong loan growth and continued progress in expense management. The core deposit base continued to grow, and our credit metrics remain strong,” commented C. Mitchell Waycaster, Renasant President and Chief Executive Officer. “We continue to focus on growth and improving profitability and remain committed to maintaining a strong balance sheet that prioritizes core deposits, capital strength and credit quality.”

    Quarterly Highlights

    Earnings

    • Net income for the first quarter of 2022 was $33.5 million with diluted EPS of $0.60
    • Net interest income (fully tax equivalent) for the first quarter of 2022 was $101.4 million, a decrease of $1.9 million from the fourth quarter of 2021
    • For the first quarter of 2022, net interest margin was 2.76%, down 5 basis points on a linked quarter basis
    • Cost of total deposits was 17 basis points for the first quarter of 2022, down 1 basis point on a linked quarter basis
    • Wealth management and insurance produced strong results during the first quarter of 2022
    • The mortgage division generated $1.2 billion in interest rate lock volume during the first quarter of 2022, which is in line with interest rate lock volume production during the fourth quarter of 2021
    • First quarter noninterest expense decreased by $7.0 million on a linked quarter basis, primarily driven by the decrease in the debt prepayment penalty of $6.1 million recognized in the fourth quarter of 2021 and a decrease in data processing due to savings realized from contract re-negotiations

    Balance Sheet

    • Loans increased $292.5 million during the first quarter of 2022 from year-end; excluding loans acquired during the quarter (as discussed immediately below), loans increased $264.4 million, which represents 10.70% annualized net loan growth. The balance of Paycheck Protection Program (“PPP”) loans was $8.4 million at March 31, 2022
    • The Company completed the acquisition of Southeastern Commercial Finance, LLC, an asset-based lending company headquartered in Birmingham, Alabama, on March 1, 2022, which added $28.1 million in loans on the date of acquisition
    • The securities portfolio increased $90.1 million during the first quarter of 2022 from year-end; this included net additions to the portfolio during the quarter of $224.9 million and a negative fair market value adjustment in our available-for-sale portfolio of $134.8 million
    • Deposits at March 31, 2022 increased $85.2 million from year-end, and noninterest bearing deposits represented 33.64% of total deposits at March 31, 2022

    Capital

    • Book value per share and tangible book value per share (non-GAAP)(1) decreased 3.5% and 6.4%, respectively, on a linked quarter basis, driven by a decrease in accumulated other comprehensive income
    • The Company redeemed $30 million of its subordinated notes on March 1, 2022
    • The Company has a $50 million stock repurchase program that will remain in effect through October 2022; however, there was no buyback activity during the first quarter of 2022

    Credit Quality

    • The Company recorded a provision for credit losses on loans of $1.5 million and a negative provision for unfunded commitments (recorded in other noninterest expense) of $550 thousand for the first quarter of 2022
    • Allowance for credit losses on loans to total loans decreased on a linked quarter basis to 1.61% at March 31, 2022 as compared to 1.64% at December 31, 2021
    • The coverage ratio, or the allowance for credit losses on loans to nonperforming loans, was 318.65% at March 31, 2022 as compared to 323.14% at December 31, 2021
    • Net loan charge-offs for the first quarter of 2022 were $851 thousand, or 0.03% of average loans on an annualized basis
    • Credit metrics remained relatively stable on a linked quarter basis with nonperforming loans to total loans remaining at 0.51% and criticized loans (which includes classified and special mention loans) to total loans decreasing to 2.47% at March 31, 2022

    (1)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.

    Income Statement

    (Dollars in thousands, except per share data)Three Months Ended
     Mar 31, 2022Dec 31, 2021Sep 30, 2021Jun 30, 2021Mar 31, 2021
    Interest income     
    Loans held for investment$95,829$98,478 $102,627 $109,721$112,006
    Loans held for sale 2,863 3,652  2,377  3,604 2,999
    Securities 10,835 9,221  8,416  7,321 6,574
    Other 664 568  593  345 183
    Total interest income 110,191 111,919  114,013  120,991 121,762
    Interest expense     
    Deposits 5,637 6,056  6,972  7,669 8,279
    Borrowings 4,925 4,381  3,749  3,743 3,835
    Total interest expense 10,562 10,437  10,721  11,412 12,114
    Net interest income 99,629 101,482  103,292  109,579 109,648
    Provision for (recovery of) credit losses     
    Provision for (recovery of) loan losses 1,500 (500) (1,200) — —
    Provision for credit losses on HTM securities — 32  —  — —
    Total provision for (recovery of) credit losses 1,500 (468) (1,200) — —
    Net interest income after provision for (recovery of) credit losses 98,129 101,950  104,492  109,579 109,648
    Noninterest income 37,458 47,582  50,755  47,610 81,037
    Noninterest expense 94,105 101,115  103,999  108,777 115,935
    Income before income taxes 41,482 48,417  51,248  48,412 74,750
    Income taxes 7,935 11,363  11,185  7,545 16,842
    Net income$33,547$37,054 $40,063 $40,867$57,908
          
    Adjusted net income (non-GAAP)(1)$33,728$38,232 $40,315 $41,169$48,244
    Adjusted pre-provision net revenue (“PPNR”) (non-GAAP)(1)$42,664$49,190 $50,171 $48,797$62,266
          
    Basic earnings per share$0.60$0.66 $0.71 $0.73$1.03
    Diluted earnings per share 0.60 0.66  0.71  0.72 1.02
    Adjusted diluted earnings per share (non-GAAP)(1) 0.60 0.68  0.71  0.73 0.85
    Average basic shares outstanding 55,809,192 55,751,487  56,146,285  56,325,717 56,240,201
    Average diluted shares outstanding 56,081,863 56,105,050  56,447,184  56,635,898 56,519,199
    Cash dividends per common share$0.22$0.22 $0.22 $0.22$0.22

    (1)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.

    Performance Ratios

     Three Months Ended
     Mar 31, 2022Dec 31, 2021Sep 30, 2021Jun 30, 2021Mar 31, 2021
    Return on average assets0.81%0.89%0.99%1.04%1.54%
    Adjusted return on average assets (non-GAAP)(1)0.82 0.92 0.99 1.04 1.29 
    Return on average tangible assets (non-GAAP)(1)0.89 0.98 1.08 1.14 1.69 
    Adjusted return on average tangible assets (non-GAAP)(1)0.90 1.01 1.09 1.14 1.41 
    Return on average equity6.05 6.59 7.16 7.40 10.81 
    Adjusted return on average equity (non-GAAP)(1)6.08 6.80 7.21 7.46 9.01 
    Return on average tangible equity (non-GAAP)(1)10.93 11.94 13.05 13.54 19.93 
    Adjusted return on average tangible equity (non-GAAP)(1)10.99 12.31 13.13 13.64 16.68 
    Efficiency ratio (fully taxable equivalent)67.78 67.04 66.77 68.49 60.29 
    Adjusted efficiency ratio (non-GAAP)(1)67.02 64.18 66.06 67.28 63.85 
    Dividend payout ratio36.67 33.33 30.99 30.14 21.36 

    Capital and Balance Sheet Ratios

     As of
     Mar 31, 2022Dec 31, 2021Sep 30, 2021Jun 30, 2021Mar 31, 2021
    Shares outstanding 55,880,666  55,756,233  55,747,407  56,350,878  56,294,346 
    Market value per share$33.45 $37.95 $36.05 $40.00 $41.38 
    Book value per share 38.25  39.63  39.53  39.11  38.61 
    Tangible book value per share (non-GAAP)(1) 20.91  22.35  22.22  21.95  21.41 
    Shareholders' equity to assets 12.68% 13.15% 13.64% 13.75% 13.91%
    Tangible common equity ratio (non-GAAP)(1) 7.35  7.86  8.15  8.22  8.23 
    Leverage ratio 9.00  9.15  9.18  9.30  9.49 
    Common equity tier 1 capital ratio 10.78  11.18  11.02  11.14  11.05 
    Tier 1 risk-based capital ratio 11.67  12.10  11.94  12.07  12.00 
    Total risk-based capital ratio 15.50  16.14  14.66  15.11  15.09 

    (1)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.

    Noninterest Income and Noninterest Expense

    (Dollars in thousands)Three Months Ended
     Mar 31, 2022Dec 31, 2021Sep 30, 2021Jun 30, 2021Mar 31, 2021
    Noninterest income     
    Service charges on deposit accounts$9,562 $9,751 $9,337$9,458$8,023
    Fees and commissions 3,982  3,885  3,837 4,110 3,900
    Insurance commissions 2,554  2,353  2,829 2,422 2,237
    Wealth management revenue 5,924  5,273  5,371 5,019 4,792
    Mortgage banking income 9,633  14,726  23,292 20,853 50,733
    Swap termination gains —  4,676  — — —
    Net gains on sales of securities —  49  764 — 1,357
    BOLI income 2,153  2,048  1,602 1,644 2,072
    Other 3,650  4,821  3,723 4,104 7,923
    Total noninterest income$37,458 $47,582 $50,755$47,610$81,037
    Noninterest expense     
    Salaries and employee benefits$62,239 $62,523 $69,115$70,293$78,696
    Data processing 4,263  5,346  5,277 5,652 5,451
    Net occupancy and equipment 11,276  11,177  11,748 11,374 12,538
    Other real estate owned (241) (60) 168 104 41
    Professional fees 3,151  3,209  2,972 2,674 2,921
    Advertising and public relations 4,059  2,929  2,922 3,100 3,252
    Intangible amortization 1,366  1,424  1,481 1,539 1,598
    Communications 2,027  2,088  2,198 2,291 2,292
    Merger and conversion related expenses 687  —  — — —
    Restructuring (benefit) charges (455) 61  — 15 292
    Debt prepayment penalty —  6,123  — — —
    Other 5,733  6,295  8,118 11,735 8,854
    Total noninterest expense$94,105 $101,115 $103,999$108,777$115,935

    Mortgage Banking Income

    (Dollars in thousands)Three Months Ended
     Mar 31, 2022Dec 31, 2021Sep 30, 2021Jun 30, 2021Mar 31, 2021
    Gain on sales of loans, net$6,047$10,801 $20,116 $17,581 $33,901 
    Fees, net 3,053 4,320  3,420  4,519  4,902 
    Mortgage servicing income (loss), net 533 (395) (244) (1,247) (1,631)
    MSR valuation adjustment — —  —  —  13,561 
    Total mortgage banking income$9,633$14,726 $23,292 $20,853 $50,733 

    Balance Sheet

    (Dollars in thousands)As of
     Mar 31, 2022Dec 31, 2021Sep 30, 2021Jun 30, 2021Mar 31, 2021
    Assets     
    Cash and cash equivalents$1,607,493 $1,877,965 $1,476,141 $1,605,488 $1,261,916 
    Securities held to maturity, at amortized cost 487,194  416,357  —  —  — 
    Securities available for sale, at fair value 2,405,316  2,386,052  2,544,643  2,163,820  1,536,041 
    Loans held for sale, at fair value 280,464  453,533  452,869  448,959  502,002 
    Loans:     
    Non purchased 9,338,890  9,011,012  8,875,880  8,892,544  9,292,502 
    Purchased 974,569  1,009,902  1,140,944  1,256,698  1,395,906 
    Total loans 10,313,459  10,020,914  10,016,824  10,149,242  10,688,408 
    Allowance for credit losses on loans (166,468) (164,171) (170,038) (172,354) (173,106)
    Loans, net 10,146,991  9,856,743  9,846,786  9,976,888  10,515,302 
    Premises and equipment, net 285,344  293,122  294,499  293,203  300,917 
    Other real estate owned 2,062  2,540  4,705  4,939  5,971 
    Goodwill 946,291  939,683  939,683  939,683  939,683 
    Other intangibles 22,731  24,098  25,522  27,003  28,542 
    Bank-owned life insurance 369,344  287,359  286,088  279,444  233,508 
    Mortgage servicing rights 91,730  89,018  86,387  84,912  80,263 
    Other assets 218,797  183,841  198,227  198,047  218,426 
    Total assets$16,863,757 $16,810,311 $16,155,550 $16,022,386 $15,622,571 
          
    Liabilities and Shareholders’ Equity     
    Liabilities     
    Deposits:     
    Noninterest-bearing$4,706,256 $4,718,124 $4,492,650 $4,349,135 $4,135,360 
    Interest-bearing 9,284,641  9,187,600  8,762,179  8,766,216  8,601,548 
    Total deposits 13,990,897  13,905,724  13,254,829  13,115,351  12,736,908 
    Short-term borrowings 111,279  13,947  11,253  14,933  12,154 
    Long-term debt 435,416  471,209  468,863  469,406  467,660 
    Other liabilities 188,523  209,578  216,661  218,889  232,148 
    Total liabilities 14,726,115  14,600,458  13,951,606  13,818,579  13,448,870 
          
    Shareholders’ equity:     
    Preferred stock —  —  —  —  — 
    Common stock$296,483 $296,483 $296,483 $296,483 $296,483 
    Treasury stock (114,050) (118,027) (118,288) (97,249) (98,949)
    Additional paid-in capital 1,297,088  1,300,192  1,298,022  1,295,879  1,294,911 
    Retained earnings 762,690  741,648  717,033  689,444  661,117 
    Accumulated other comprehensive income (loss) (104,569) (10,443) 10,694  19,250  20,139 
    Total shareholders’ equity 2,137,642  2,209,853  2,203,944  2,203,807  2,173,701 
    Total liabilities and shareholders’ equity$16,863,757 $16,810,311 $16,155,550 $16,022,386 $15,622,571 

    Net Interest Income and Net Interest Margin

    (Dollars in thousands)Three Months Ended
     March 31, 2022December 31, 2021March 31, 2021
     Average
    Balance    		Interest
    Income/
    Expense    		Yield/  
     Rate    		Average
    Balance    		Interest
    Income/
    Expense    		Yield/  
     Rate    		Average
    Balance    		Interest
    Income/
    Expense    		Yield/  
     Rate
    Interest-earning assets:         
    Non purchased loans$9,085,482$84,6533.77%$8,806,254$85,3623.85%$8,362,793$81,9283.97%
    Purchased loans 983,523 11,7294.82% 1,079,630 13,8235.09% 1,454,637 20,4575.69%
    PPP loans 39,506 6196.36% 62,726 4853.07% 985,561 10,6874.40%
    Total loans 10,108,511 97,0013.88% 9,948,610 99,6703.98% 10,802,991 113,0724.24%
    Loans held for sale 330,442 2,8633.48% 498,724 3,6522.93% 406,397 2,9992.96%
    Taxable securities 2,499,822 8,7821.41% 2,245,249 7,2931.30% 1,065,779 4,8401.82%
    Tax-exempt securities(1) 438,380 2,6352.40% 392,700 2,5032.55% 306,344 2,2842.98%
    Total securities 2,938,202 11,4171.55% 2,637,949 9,7961.49% 1,372,123 7,1242.08%
    Interest-bearing balances with banks 1,463,991 6640.18% 1,522,433 5680.15% 777,166 1830.10%
    Total interest-earning assets 14,841,146 111,9453.05% 14,607,716 113,6863.09% 13,358,677 123,3783.74%
    Cash and due from banks 206,224   201,941   205,830  
    Intangible assets 965,430   964,575   969,001  
    Other assets 684,464   676,408   670,183  
    Total assets$16,697,264  $16,450,640  $15,203,691  
    Interest-bearing liabilities:         
    Interest-bearing demand(2)$6,636,392$3,6470.22%$6,460,178$3,4870.21%$5,906,230$3,9320.27%
    Savings deposits 1,097,560 1390.05% 1,045,784 1510.06% 882,758 1690.08%
    Time deposits 1,374,722 1,8510.55% 1,434,162 2,4180.67% 1,655,778 4,1781.02%
    Total interest-bearing deposits 9,108,674 5,6370.25% 8,940,124 6,0560.27% 8,444,766 8,2790.40%
    Borrowed funds 485,777 4,9254.08% 434,546 4,3814.03% 483,907 3,8353.19%
    Total interest-bearing liabilities 9,594,451 10,5620.44% 9,374,670 10,4370.44% 8,928,673 12,1140.55%
    Noninterest-bearing deposits 4,651,793   4,633,885   3,862,422  
    Other liabilities 201,353   210,404   240,171  
    Shareholders’ equity 2,249,667   2,231,681   2,172,425  
    Total liabilities and shareholders’ equity$16,697,264  $16,450,640  $15,203,691  
    Net interest income/ net interest margin $101,3832.76% $103,2492.81% $111,2643.37%
    Cost of funding  0.30%  0.30%  0.38%
    Cost of total deposits  0.17%  0.18%  0.27%

    (1) U.S. Government and some U.S. Government Agency securities are tax-exempt in the states in which the Company operates.
    (2) Interest-bearing demand deposits include interest-bearing transactional accounts and money market deposits.

    Supplemental Margin Information

    (Dollars in thousands)Three Months Ended
     Mar 31, 2022Dec 31, 2021Mar 31, 2021
    Earning asset mix:   
    Loans held for investment, excluding PPP loans 67.84% 67.68% 73.49%
    PPP loans 0.27  0.43  7.38 
    Loans held for sale 2.23  3.41  3.04 
    Securities 19.80  18.06  10.27 
    Interest-bearing balances with banks 9.86  10.42  5.82 
    Total 100.00% 100.00% 100.00%
        
    Funding sources mix:   
    Noninterest-bearing demand 32.65% 33.08% 30.20%
    Interest-bearing demand 46.59  46.11  46.18 
    Savings 7.70  7.47  6.90 
    Time deposits 9.65  10.24  12.94 
    Borrowed funds 3.41  3.10  3.78 
    Total 100.00% 100.00% 100.00%
        
    Net interest income collected on problem loans$434 $578 $2,180 
    Total accretion on purchased loans 1,235  2,187  3,088 
    Total impact on net interest income$1,669 $2,765 $5,268 
    Impact on net interest margin 0.05% 0.08% 0.16%
    Impact on loan yield 0.07% 0.11% 0.20%
        
    Interest income on PPP loans$619 $485 $10,687 
    PPP impact on net interest margin 0.01% —% 0.07%
    PPP impact on loan yield 0.01% —% 0.01%

    Loan Portfolio

    (Dollars in thousands)As of
     Mar 31, 2022Dec 31, 2021Sep 30, 2021Jun 30, 2021Mar 31, 2021
    Loan Portfolio:     
    Commercial, financial, agricultural$1,437,225$1,364,879$1,368,557$1,387,702$1,388,423
    Lease financing 89,842 76,125 79,215 74,003 75,256
    Real estate - construction 1,222,052 1,104,896 1,091,296 1,051,359 955,918
    Real estate - 1-4 family mortgages 2,840,979 2,724,246 2,724,743 2,702,091 2,686,061
    Real estate - commercial mortgages 4,577,864 4,549,037 4,535,730 4,530,169 4,549,027
    Installment loans to individuals 137,115 143,340 149,821 156,987 172,859
    Subtotal 10,305,077 9,962,523 9,949,362 9,902,311 9,827,544
    PPP 8,382 58,391 67,462 246,931 860,864
    Total loans$10,313,459$10,020,914$10,016,824$10,149,242$10,688,408

    Credit Quality and Allowance for Credit Losses on Loans

    (Dollars in thousands)As of
     Mar 31, 2022Dec 31, 2021Sep 30, 2021Jun 30, 2021Mar 31, 2021
    Nonperforming Assets:     
    Non purchased     
    Non purchased nonaccruing loans$32,573 $30,751 $29,266 $27,101 $24,794 
    Non purchased loans 90 days or more past due 209  1,074  908  800  2,235 
    Total non purchased nonperforming loans 32,782  31,825  30,174  27,901  27,029 
    Non purchased other real estate owned 531  951  2,252  1,675  2,292 
    Total non purchased nonperforming assets 33,313  32,776  32,426  29,576  29,321 
    Purchased     
    Purchased nonaccruing loans$19,422 $18,613 $26,492 $27,690 $28,947 
    Purchased loans 90 days or more past due 38  367  74  945  129 
    Total purchased nonperforming loans 19,460  18,980  26,566  28,635  29,076 
    Purchased other real estate owned 1,531  1,589  2,453  3,264  3,679 
    Total purchased nonperforming assets$20,991 $20,569 $29,019 $31,899 $32,755 
    Total nonperforming loans$52,242 $50,805 $56,740 $56,536 $56,105 
    Total nonperforming assets$54,304 $53,345 $61,445 $61,475 $62,076 
    Allowance for credit losses on loans$166,468 $164,171 $170,038 $172,354 $173,106 
    Net loan charge-offs$851 $5,367 $1,116 $752 $3,038 
    Annualized net loan charge-offs / average loans 0.03% 0.21% 0.04% 0.03% 0.11%
    Nonperforming loans / total loans 0.51  0.51  0.57  0.56  0.52 
    Nonperforming assets / total assets 0.32  0.32  0.38  0.38  0.40 
    Allowance for credit losses on loans / total loans 1.61  1.64  1.70  1.70  1.62 
    Allowance for credit losses on loans / nonperforming loans 318.65  323.14  299.68  304.86  308.54 
    Nonperforming loans / total loans excluding PPP loans (non-GAAP)(1) 0.51  0.51  0.57  0.57  0.57 
    Nonperforming assets / total assets excluding PPP loans (non-GAAP)(1) 0.32  0.32  0.38  0.39  0.42 
    Allowance for credit losses on loans / total loans excluding PPP loans (non-GAAP)(1) 1.62  1.65  1.71  1.74  1.76 

    (1)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.

    CONFERENCE CALL INFORMATION:
    A live audio webcast of a conference call with analysts will be available beginning at 10:00 AM Eastern Time (9:00 AM Central Time) on Wednesday, April 27, 2022.

    The webcast can be accessed through Renasant’s investor relations website at www.renasant.com or https://services.choruscall.com/mediaframe/webcast.html?webcastid=EvhJJJ96. To access the conference via telephone, dial 1-877-513-1143 in the United States and request the Renasant Corporation 2022 First Quarter Earnings Conference Call and Webcast. 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 7481861 or by dialing 1-412-317-0088 internationally and entering the same conference number. Telephone replay access is available until May 11, 2022.

    ABOUT RENASANT CORPORATION:

    Renasant Corporation is the parent of Renasant Bank, a 118-year-old financial services institution. Renasant has assets of approximately $16.9 billion and operates 196 banking, lending, mortgage, wealth management and insurance offices in Mississippi, Tennessee, Alabama, Florida, Georgia, North Carolina and South Carolina.

    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,” “focus,” “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.

    Important factors currently known to management that could cause our 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; (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) civil unrest, natural disasters, epidemics (including the re-emergence of the COVID-19 pandemic) 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.

    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 and the presentation slides furnished to the SEC on the same Form 8-K as this release contain non-GAAP financial measures, including, without limitation, (i) core loan yield, (ii) core net interest income and margin, (iii) adjusted pre-provision net revenue, (iv) adjusted net income, (v) adjusted diluted earnings per share, (vi) tangible book value per share, (vii) tangible common equity ratio, (vii) certain asset quality ratios (namely, loans 30-89 past due to total loans, criticized loans to total loans, nonperforming loans to total loans, nonperforming assets to total assets, net charge-offs to average loans and the allowance for credit losses to total loans) in each case excluding PPP loans, (ix) certain performance ratios (namely, the ratio of adjusted pre-provision net revenue to average assets, the return on average assets and on average equity, and the return on average tangible assets and on average tangible common equity (including each on an as-adjusted basis)), and (x) the adjusted efficiency ratio. These non-GAAP financial measures adjust GAAP financial measures to exclude intangible assets and/or certain charges (such as, among others, merger and conversion expenses, COVID-19 related expenses, debt prepayment penalties, swap termination gains, restructuring charges 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 or, with respect to core loan yield and its asset quality measures, to exclude the Company’s PPP loans. 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 are 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; with respect to the core loan yield and certain asset quality measures, management excludes PPP loans, which bear an interest rate fixed by Small Business Administration (“SBA”) regulations and are both forgivable and guaranteed by the SBA, to more clearly measure loan yields affected by competitive factors and potential loss in the Company’s loan portfolio and the coverage therefor. 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, charges such as debt prepayment penalties, restructuring charges and COVID-19 related expenses, and the amount of PPP loans 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 non-GAAP financial measures to the most directly comparable GAAP financial measures are included in the tables below under the caption “Non-GAAP Reconciliations”.

    None of the non-GAAP financial information that the Company has included in this release or the accompanying presentation slides are 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.

    Non-GAAP Reconciliations

    (Dollars in thousands, except per share data)Three Months Ended
     Mar 31, 2022Dec 31, 2021Sep 30, 2021Jun 30, 2021Mar 31, 2021
    Adjusted Pre-Provision Net Revenue (“PPNR”)   
    Net income (GAAP)$33,547 $37,054 $40,063 $40,867 $57,908 
    Income taxes 7,935  11,363  11,185  7,545  16,842 
    Provision for (recovery of) credit losses (including unfunded commitments) 950  (768) (1,400) —  — 
    Pre-provision net revenue (non-GAAP)$42,432 $47,649 $49,848 $48,412 $74,750 
    Merger and conversion expense 687  —  —  —  — 
    Debt prepayment penalties —  6,123  —  —  — 
    Swap termination gains —  (4,676) —  —  — 
    MSR valuation adjustment —  —  —  —  (13,561)
    Restructuring (benefit) charges (455) 61  —  15  292 
    COVID-19 related expenses(1) —  33  323  370  785 
    Adjusted pre-provision net revenue (non-GAAP)$42,664 $49,190 $50,171 $48,797 $62,266 
          
    Adjusted Net Income and Adjusted Tangible Net Income   
    Net income (GAAP)$33,547 $37,054 $40,063 $40,867 $57,908 
    Amortization of intangibles 1,366  1,424  1,481  1,539  1,598 
    Tax effect of adjustments noted above(2) (303) (335) (323) (333) (361)
    Tangible net income (non-GAAP)$34,610 $38,143 $41,221 $42,073 $59,145 
          
    Net income (GAAP)$33,547 $37,054 $40,063 $40,867 $57,908 
    Merger and conversion expense 687  —  —  —  — 
    Debt prepayment penalties —  6,123  —  —  — 
    Swap termination gain —  (4,676) —  —  — 
    MSR valuation adjustment —  —  —  —  (13,561)
    Restructuring charges (455) 61  —  15  292 
    COVID-19 related expenses(1) —  33  323  370  785 
    Tax effect of adjustments noted above(2) (51) (363) (71) (83) 2,820 
    Adjusted net income (non-GAAP)$33,728 $38,232 $40,315 $41,169 $48,244 
    Amortization of intangibles 1,366  1,424  1,481  1,539  1,598 
    Tax effect of adjustments noted above(2) (303) (335) (323) (333) (361)
    Adjusted tangible net income (non-GAAP)$34,791 $39,321 $41,473 $42,375 $49,481 
          
    Tangible Assets and Tangible Shareholders’ Equity   
    Average shareholders’ equity (GAAP)$2,249,667 $2,231,681 $2,219,431 $2,213,743 $2,172,425 
    Average intangible assets 965,430  964,575  965,960  967,430  969,001 
    Average tangible shareholders’ equity (non-GAAP)$1,284,237 $1,267,106 $1,253,471 $1,246,313 $1,203,424 
          
    Average assets (GAAP)$16,697,264 $16,450,640 $16,130,149 $15,831,018 $15,203,691 
    Average intangible assets 965,430  964,575  965,960  967,430  969,001 
    Average tangible assets (non-GAAP)$15,731,834 $15,486,065 $15,164,189 $14,863,588 $14,234,690 
          
    Shareholders’ equity (GAAP)$2,137,642 $2,209,853 $2,203,944 $2,203,807 $2,173,701 
    Intangible assets 969,022  963,781  965,205  966,686  968,225 
    Tangible shareholders’ equity (non-GAAP)$1,168,620 $1,246,072 $1,238,739 $1,237,121 $1,205,476 
          
    Total assets (GAAP)$16,863,757 $16,810,311 $16,155,550 $16,022,386 $15,622,571 
    Intangible assets 969,022  963,781  965,205  966,686  968,225 
    Total tangible assets (non-GAAP)$15,894,735 $15,846,530 $15,190,345 $15,055,700 $14,654,346 
          
    Adjusted Performance Ratios     
    Return on average assets (GAAP) 0.81% 0.89% 0.99% 1.04% 1.54%
    Adjusted return on average assets (non-GAAP) 0.82% 0.92% 0.99% 1.04% 1.29%
    Return on average tangible assets (non-GAAP) 0.89% 0.98% 1.08% 1.14% 1.69%
    Adjusted pre-provision net revenue to average assets (non-GAAP) 1.04% 1.19% 1.23% 1.24% 1.66%
    Adjusted return on average tangible assets (non-GAAP) 0.90% 1.01% 1.09% 1.14% 1.41%
    Return on average equity (GAAP) 6.05% 6.59% 7.16% 7.40% 10.81%
    Adjusted return on average equity (non-GAAP) 6.08% 6.80% 7.21% 7.46% 9.01%
    Return on average tangible equity (non-GAAP) 10.93% 11.94% 13.05% 13.54% 19.93%
    Adjusted return on average tangible equity (non-GAAP) 10.99% 12.31% 13.13% 13.64% 16.68%
          
    Adjusted Diluted Earnings Per Share   
    Average diluted shares outstanding 56,081,863  56,105,050  56,447,184  56,635,898  56,519,199 
          
    Diluted earnings per share (GAAP)$0.60 $0.66 $0.71 $0.72 $1.02 
    Adjusted diluted earnings per share (non-GAAP)$0.60 $0.68 $0.71 $0.73 $0.85 
          
    Tangible Book Value Per Share     
    Shares outstanding 55,880,666  55,756,233  55,747,407  56,350,878  56,294,346 
          
    Book value per share (GAAP)$38.25 $39.63 $39.53 $39.11 $38.61 
    Tangible book value per share (non-GAAP)$20.91 $22.35 $22.22 $21.95 $21.41 
          
    Tangible Common Equity Ratio     
    Shareholders' equity to assets (GAAP) 12.68% 13.15% 13.64% 13.75% 13.91%
    Tangible common equity ratio (non-GAAP) 7.35% 7.86% 8.15% 8.22% 8.23%
          
    Adjusted Efficiency Ratio     
    Net interest income (FTE) (GAAP) 101,383  103,249  105,002  111,205  111,264 
          
    Total noninterest income (GAAP) 37,458  47,582  50,755  47,610  81,037 
    MSR valuation adjustment —  —  —  —  13,561 
    Swap termination gains —  4,676  —  —  — 
    Securities gains —  49  764  —  1,357 
    Total adjusted noninterest income (non-GAAP) 37,458  42,857  49,991  47,610  66,119 
          
    Noninterest expense (GAAP) 94,105  101,115  103,999  108,777  115,935 
    Amortization of intangibles 1,366  1,424  1,481  1,539  1,598 
    Merger and conversion expense 687  —  —  —  — 
    Debt prepayment penalty —  6,123  —  —  — 
    Restructuring (benefit) charges (455) 61  —  15  292 
    Recovery of unfunded commitments (550) (300) (200) —  — 
    COVID-19 related expenses(1) —  33  323  370  785 
    Total adjusted noninterest expense (non-GAAP) 93,057  93,774  102,395  106,853  113,260 
          
    Efficiency ratio (GAAP) 67.78% 67.04% 66.77% 68.49% 60.29%
    Adjusted efficiency ratio (non-GAAP) 67.02% 64.18% 66.06% 67.28% 63.85%
          
    Core Net Interest Income and Core Net Interest Margin   
    Net interest income (FTE) (GAAP)$101,383 $103,249 $105,002 $111,205 $111,264 
    Net interest income collected on problem loans 434  577  316  1,339  2,180 
    Accretion recognized on purchased loans 1,235  2,187  2,871  2,638  3,088 
    Interest income recognized on PPP loans 619  485  3,503  10,120  10,687 
    Core net interest income (FTE) (non-GAAP)$99,095 $99,999 $98,312 $97,108 $95,309 
          
    Average earning assets (GAAP)$14,841,146 $14,607,716 $14,256,421 $13,989,264 $13,358,677 
    Average PPP loans 39,506  62,726  126,870  628,462  985,561 
    Average earning assets excluding PPP loans (non-GAAP)$14,801,640 $14,544,990 $14,129,551 $13,360,802 $12,373,116 
          
    Net interest margin (GAAP) 2.76% 2.81% 2.93% 3.19% 3.37%
    Core net interest margin (non-GAAP) 2.71% 2.73% 2.76% 2.92% 3.12%
          
    Core Loan Yield     
    Loan interest income (FTE) (GAAP)$97,001 $99,670 $103,769 $110,785 $113,072 
    Net interest income collected on problem loans 434  578  316  1,339  2,180 
    Accretion recognized on purchased loans 1,235  2,187  2,871  2,638  3,088 
    Interest income recognized on PPP loans 619  485  3,503  10,120  10,687 
    Core loan interest income (FTE) (non-GAAP)$94,713 $96,420 $97,079 $96,688 $97,117 
          
    Average loans (GAAP)$10,108,511 $9,948,610 $10,017,742 $10,478,121 $10,802,991 
    Average PPP loans 39,506  62,726  126,870  628,462  985,561 
    Average loans excluding PPP loans (non-GAAP)$10,069,005 $9,885,884 $9,890,872 $9,849,659 $9,817,430 
          
    Loan yield (GAAP) 3.88% 3.98% 4.11% 4.24% 4.24%
    Core loan yield (non-GAAP) 3.82% 3.87% 3.89% 3.94% 4.01%
          
    Adjusted Asset Quality Ratios     
    Total loans (GAAP)$10,313,459 $10,020,914 $10,016,824 $10,149,242 $10,688,408 
    PPP loans 8,382  58,391  67,462  246,931  860,864 
    Total loans excluding PPP loans (non-GAAP)$10,305,077 $9,962,523 $9,949,362 $9,902,311 $9,827,544 
          
    Loans 30-89 days past due$30,617 $27,604 $14,806 $15,077 $21,801 
    Loans 30-89 days past due / total loans (GAAP) 0.30% 0.28% 0.15% 0.15% 0.20%
    Loans 30-89 days past due / total loans excluding PPP loans (non-GAAP) 0.30% 0.28% 0.15% 0.15% 0.22%
          
    Classified loans$178,015 $160,790 $187,223 $206,724 $229,243 
    Special Mention loans 76,949  115,496  138,497  125,507  120,320 
    Criticized loans(3)$254,964 $276,286 $325,720 $332,231 $349,563 
    Criticized loans / total loans (GAAP) 2.47% 2.76% 3.25% 3.27% 3.27%
    Criticized loans / total loans excluding PPP loans (non-GAAP) 2.47% 2.77% 3.27% 3.36% 3.56%
          
    Nonperforming loans$52,242 $50,805 $56,740 $56,536 $56,105 
    Nonperforming loans / total loans (GAAP) 0.51% 0.51% 0.57% 0.56% 0.52%
    Nonperforming loans / total loans excluding PPP loans (non-GAAP) 0.51% 0.51% 0.57% 0.57% 0.57%
          
    Allowance for credit losses on loans$166,468 $164,171 $170,038 $172,354 $173,106 
    ACL / total loans (GAAP) 1.61% 1.64% 1.70% 1.70% 1.62%
    ACL / total loans excluding PPP loans (non-GAAP) 1.62% 1.65% 1.71% 1.74% 1.76%
          
          
    Average loans (GAAP)$10,108,511 $9,948,610 $10,017,742 $10,478,121 $10,802,991 
    Average PPP loans 39,506  62,726  126,870  628,462  985,561 
    Average loans excluding PPP loans (non-GAAP)$10,069,005 $9,885,884 $9,890,872 $9,849,659 $9,817,430 
          
    Net charge-offs$851 $5,367 $1,116 $752 $3,038 
    Annualized net charge-offs / average loans (GAAP) 0.03% 0.21% 0.04% 0.03% 0.11%
    Annualized net charge-offs / average loans excluding PPP loans (non-GAAP) 0.03% 0.22% 0.04% 0.03% 0.13%
          
    Total assets (GAAP)$16,863,757 $16,810,311 $16,155,550 $16,022,386 $15,622,571 
    PPP loans 8,382  58,391  67,462  246,931  860,864 
    Total assets excluding PPP loans (non-GAAP)$16,855,375 $16,751,920 $16,088,088 $15,775,455 $14,761,707 
          
    Nonperforming assets$54,304 $53,345 $61,445 $61,475 $62,076 
    Nonperforming assets / total assets (GAAP) 0.32% 0.32% 0.38% 0.38% 0.40%
    Nonperforming assets / total assets excluding PPP loans (non-GAAP) 0.32% 0.32% 0.38% 0.39% 0.42%

    (1) Primarily consists of employee overtime and employee benefit accruals directly related to the response to the COVID-19 pandemic and federal legislation enacted to address the pandemic, such as the CARES Act, and 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.
    (2) Tax effect is calculated based on the respective periods’ effective tax rate excluding the impact of discrete items.
    (3) Criticized loans include loans in risk rating classifications of classified and special mention.

    Contacts:For Media: For Financials:
     John S. Oxford James C. Mabry IV
     Senior Vice President Executive Vice President
     Director of Marketing Chief Financial Officer
     (662) 680-1219 (662) 680-1281


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