Exhibit
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Investor Contacts: Rusty Cloutier President & CEO or Jim McLemore, CFA Sr. EVP & CFO 337.237.8343 |
MidSouth Bancorp, Inc. Reports Fourth Quarter 2015 Results
and Declares Quarterly Dividends
Quarterly Highlights
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• | Diluted operating EPS $0.15 versus $0.21 for 3Q2015 and $0.31 for 4Q2014 |
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• | Regulatory capital ratios improved during 4Q15 |
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• | Loan loss reserve to total loans of 1.50% with $3.0 million provision |
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• | Total energy loans declined $30.9 million to 21% of loans at period end |
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• | Direct C&I energy exposure 16.8% of loans with 2.9% reserve at period end |
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• | 4 energy-related credits totaling $11.9 million downgraded during the quarter |
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• | Total net charge-offs for the quarter were $2.9 million |
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• | Energy-related charge-offs of $1.1 million during the quarter; YTD energy-related charge-offs $1.6 million |
LAFAYETTE, LA., January 27, 2016/PRNewswire-FirstCall/ -- MidSouth Bancorp, Inc. (“MidSouth”) (NYSE:MSL) today reported quarterly net earnings available to common shareholders of $1.7 million for the fourth quarter of 2015, compared to net earnings available to common shareholders of $3.5 million reported for the fourth quarter of 2014 and $2.4 million in net earnings available to common shareholders for the third quarter of 2015. Diluted earnings for the fourth quarter of 2015 were $0.15 per common share, compared to $0.30 per common share reported for the fourth quarter of 2014 and $0.21 per common share reported for the third quarter of 2015.
C. R. Cloutier, President and CEO, commenting on fourth quarter earnings remarked, "Although our energy customers continue to feel the profound effects of the downturn in energy prices, they are showing great resilience in dealing with the challenges presented by this environment. Many of our borrowers have been through numerous downturns and have weathered these kinds of storms before. Although credit downgrades were relatively modest this quarter, we continue to be vigilant in working with our customers and staying abreast of developments in their businesses. We believe we are being systematic and realistic in our approach to monitoring credits and downgrading them where appropriate."
Cloutier continued, "Having said that, our earnings continue to be negatively impacted by the prolonged downturn in energy prices in terms of its impact on loan growth, foregone interest on non-accruing loans, loan loss provisions and additional operating expenses associated with problem assets. Nevertheless, all of our regulatory capital ratios continued to improve and we remain well capitalized."
Energy Lending Update
MidSouth Bank defines an energy loan as any loan where the borrower's ability to repay is disproportionately impacted by a prolonged downturn in energy prices. Under this definition, the Bank includes direct Commercial and Industrial (C&I) loans to energy borrowers, as well as Commercial Real Estate (CRE) loans, Residential Real Estate loans and loans to energy-related borrowers where the loan's primary collateral is cash and marketable securities. Although this definition has resulted in a lack of comparability with some energy related banks, management believes it to be the prudent approach to monitoring and managing the Bank's energy exposure.
Other comments on the bank's energy lending:
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• | Total energy loans, as defined above, decreased $30.9 million during 4Q15 to $264.7 million, or 20.9%, from 22.7% at September 30, 2015. |
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• | Direct C&I energy loans were $212.1 million or 16.8% of total loans at December 31, 2015. |
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• | Energy-related CRE and residential real estate loans were $50.3 million or 4.0% of total loans at December 31, 2015. |
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• | The Bank has no reserve-based energy loans and therefore does not conduct periodic borrowing base redeterminations associated with reserve based loans. |
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• | One energy relationship totaling $8.7 million is the only Shared National Credit (SNC) in the energy portfolio at December 31, 2015. |
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• | Only four energy loan relationships had rating changes during the quarter |
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◦ | Two loans totaling $11.7 million were downgraded to Special Mention |
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◦ | Two loans totaling $243,000 were downgraded to Substandard |
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• | One material energy-related charge-off totaled $1.0 million during 4Q15 and YTD energy-related charge-offs totaled $1.6 million, or approximately 58 basis points of average energy loans. |
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• | No new energy loan impairments recorded during the quarter. |
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• | The energy reserve as a percentage of total energy loans, as defined, was 2.6% at December 31, 2015. The reserve attributable to C&I energy loans was approximately 2.9%. |
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• | The Bank has determined its loan loss reserves using a pre-defined methodology consistently applied, which takes into account historical losses, migrations of credits using its internal loan grading system and other qualitative factors. |
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• | To date, during the month of January 2016, the Bank had 2 rating related changes to its energy portfolio: |
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◦ | One credit rated Special Mention in the amount of $2.3 million was paid off |
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◦ | One credit in the amount of $1.8 million was downgraded from Pass to Special Mention |
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◦ | There have been no other material changes to Special Mention or Substandard energy loans subsequent to December 31, 2015 |
More information on our energy loan portfolio can be found on our website at MidSouthBank.com under Investor Relations/Presentations.
Balance Sheet
Total consolidated assets at December 31, 2015 were $1.9 billion, compared to $2.0 billion at September 30, 2015 and $1.9 billion at December 31, 2014. Our stable core deposit base, which excludes time deposits, totaled $1.4 billion at December 31, 2015 and $1.3 billion at September 30, 2015 and accounted for 89.1% of deposits compared to 85.7% of deposits, respectively. Net loans totaled $1.2 billion at December 31, 2015, compared to $1.3 billion at September 30, 2015 and December 31, 2014.
MidSouth’s Tier 1 leverage capital ratio was 10.10% at December 31, 2015, compared to 9.98% at September 30, 2015. Tier 1 risk-based capital and total risk-based capital ratios were 13.25% and 14.50% at December 31, 2015, compared to 12.86% and 14.11% at September 30, 2015, respectively. Tier 1 common equity to total risk-weighted assets at December 31, 2015 was 8.91%. Tangible common equity totaled $124.1 million at December 31, 2015, compared to $124.7 million at September 30, 2015. The decrease in tangible common equity resulted primarily from a $1.8 million decline in the net unrealized gain on available for sale securities recorded in capital. Tangible book value per share at December 31, 2015 was $10.92 versus $10.97 at September 30, 2015.
Asset Quality
Nonperforming assets totaled $54.4 million at December 31, 2015, a decrease of $1.9 million compared to $56.3 million reported at September 30, 2015. The decrease resulted primarily from a $1.0 million partial charge-off of an energy related relationship that was placed on non-accrual during the third quarter of 2015. Allowance coverage for nonperforming loans increased to 37.87% at December 31, 2015, compared to 36.63% at September 30, 2015. The ALLL/total loans ratio was 1.50% at December 31, 2015 and 1.46% at September 30, 2015. Including valuation accounting adjustments on acquired loans, the total valuation accounting adjustment plus ALLL was 1.78% of loans at December 31, 2015. The ratio of annualized net charge-offs to total loans increased to 0.92% for the three months ended December 31, 2015 compared to 0.28% for the three months ended September 30, 2015.
Total nonperforming assets to total loans plus ORE and other assets repossessed was 4.29% at December 31, 2015 compared to 4.32% at September 30, 2015. Loans classified as troubled debt restructurings, accruing (“TDRs, accruing”) decreased to $164,000 at December 31, 2015 compared to $168,000 at September 30, 2015. Classified assets, including ORE, decreased $9.2 million, or 10.7%, to $76.6 million at December 31, 2015 compared to $85.8 million at September 30, 2015. The decrease in classified assets during the quarter ended December 31, 2015 is primarily due to the upgrade of one non-energy related relationship totaling $4.4 million and paydowns on several loans.
Fourth Quarter 2015 vs. Fourth Quarter 2014 Earnings Comparison
Fourth quarter 2015 net earnings available to common shareholders totaled $1.7 million compared to $3.5 million for the fourth quarter of 2014. Revenues from consolidated operations decreased $2.0 million in quarterly comparison, from $25.1 million for the three months ended
December 31, 2014 to $23.1 million for the three months ended December 31, 2015. Net interest income decreased $1.6 million in quarterly comparison primarily due to a $1.1 million decrease in interest income earned on loans, which included a $352,000 decrease in purchase accounting adjustments on acquired loans. The decrease in interest income on loans and investments securities was partially offset by a $123,000 decrease in interest expense on deposits. Noninterest income decreased $416,000 in quarterly comparison, from $5.0 million for the three months ended December 31, 2014 to $4.6 million for the three months ended December 31, 2015. The decrease in noninterest income resulted primarily from a $247,000 reduction in service charges on deposit accounts, including NSF fees.
Excluding non-operating expenses of $156,000 in the fourth quarter of 2014, noninterest expenses increased $396,000 in quarterly comparison and primarily consisted of increases of $242,000 in FDIC premiums, $118,000 in legal and professional fees and $126,000 in ATM/debit card expense, which were partially offset by a $91,000 decrease in marketing expense. The provision for loan losses increased $300,000 in quarterly comparison primarily due to increases in classified assets and specific reserves on impaired loans. Income tax expense decreased $753,000 in quarterly comparison.
Dividends paid on the Series B Preferred Stock issued to the Treasury as a result of our participation in the Small Business Lending Fund (“SBLF”) totaled $80,000 for the fourth quarter of 2015 based on a dividend rate of 1.00%. The dividend rate is set at 1.00% through February 25, 2016, at which point the rate will adjust upward to 9%. The Series C Preferred Stock issued with the December 28, 2012 acquisition of PSB Financial Corporation (“PSB”) paid dividends totaling $91,000 for the three months ended December 31, 2015.
Fully taxable-equivalent (“FTE”) net interest income totaled $18.8 million and $20.5 million for the quarters ended December 31, 2015 and 2014, respectively. The FTE net interest income decreased $1.7 million in prior year quarterly comparison primarily due to a $1.5 million decrease in interest income on loans. Despite a $7.1 million increase in the average volume on loans, interest income on loans decreased due to a decrease in the average yield on loans of 49 basis points, from 5.90% to 5.41%. The purchase accounting adjustments added 15 basis points to the average yield on loans for the fourth quarter of 2015 and 26 basis points to the average yield on loans for the fourth quarter of 2014. Excluding the impact of the purchase accounting adjustments, average loan yields declined 38 basis points in prior year quarterly comparison, from 5.64% to 5.26%. Loan yields have declined primarily as the result of a sustained low interest rate environment and a higher volume of loans on nonaccrual status.
Investment securities totaled $435.0 million, or 22.6% of total assets at December 31, 2015, versus $418.2 million, or 21.6% of total assets at December 31, 2014. The investment portfolio had an effective duration of 3.8 years and a net unrealized gain of $784,000 at December 31, 2015. The average volume of investment securities decreased $13.6 million in prior year quarterly comparison. The average tax equivalent yield on investment securities decreased 9 basis points, from 2.74% to 2.65%.
The average yield on all earning assets decreased 43 basis points in prior year quarterly comparison, from 4.95% for the fourth quarter of 2014 to 4.52% for the fourth quarter of 2015. Excluding the impact of purchase accounting adjustments, the average yield on total earning
assets decreased 35 basis points, from 4.77% to 4.42% for the three month periods ended December 31, 2014 and 2015, respectively.
Interest expense increased $32,000 in prior year quarterly comparison primarily due to a $9.2 million increase in the average balance of interest-bearing liabilities. Excluding purchase accounting adjustments on acquired certificates of deposit and FHLB borrowings, the average rate paid on interest-bearing liabilities was 0.44% for the three months ended December 31, 2015 and 2014.
As a result of these changes in volume and yield on earning assets and interest-bearing liabilities, the FTE net interest margin decreased 43 basis points, from 4.65% for the fourth quarter of 2014 to 4.22% for the fourth quarter of 2015. Excluding purchase accounting adjustments on loans, deposits and FHLB borrowings, the FTE margin decreased 35 basis points, from 4.44% for the fourth quarter of 2014 to 4.09% for the fourth quarter of 2015.
Fourth Quarter 2015 vs. Third Quarter 2015 Earnings Comparison
In sequential-quarter comparison, net earnings available to common shareholders decreased $750,000, from $2.4 million for the three months ended September 30, 2015 to $1.7 million for the three months ended December 31, 2015. Net interest income decreased $604,000 in sequential-quarter comparison, primarily due to a $499,000 decrease in interest income earned on loans. Noninterest income decreased $193,000 in sequential-quarter comparison, from $4.8 million for the three months ended September 30, 2015 to $4.6 million for the three months ended December 31, 2015.
Noninterest expense increased $1.0 million in sequential-quarter comparison. The increase in noninterest expense consisted primarily of increases of $591,000 in salaries and benefits costs, $119,000 in FDIC premiums, $82,000 in corporate development expense and $62,000 in recruiting expense, combined with smaller decreases in several other noninterest expense categories.
FTE net interest income decreased $617,000 in sequential-quarter comparison primarily due to a $673,000 decrease in interest income on loans. The average volume of loans decreased $14.9 million and the average yield on loans decreased 14 basis points, from 5.55% for the third quarter of 2015 to 5.41% for the fourth quarter of 2015. Excluding purchase accounting adjustments, the loan yield increased 3 basis points, from 5.35% to 5.38% during the same period. The average yield on total earning assets decreased 13 basis points for the same period, from 4.65% to 4.52%, respectively. As a result of these changes in volume and yield on earning assets, the FTE net interest margin decreased 12 basis points, from 4.34% to 4.22%. Excluding purchase accounting adjustments, the FTE net interest margin decreased 8 basis points, from 4.17% for the third quarter of 2015 to 4.09% for the fourth quarter of 2015.
Year-Over-Year Earnings Comparison
In year-over-year comparison, net earnings available to common shareholders decreased $8.1 million, from $18.4 million at December 31, 2014 to $10.3 million at December 31, 2015. The decrease resulted primarily from an $8.3 million increase in the provision for loan losses. 2014
net earnings included $3.0 million of executive officer life insurance proceeds, $1.1 million in gain on sale of ORE (included in noninterest expenses), $128,000 in gain on sales of securities, $516,000 of efficiency consultant expenses, $189,000 of expenses related to the loss of an executive officer, $394,000 in losses on disposal of fixed assets and a $258,000 loss on redemption of Trust Preferred Securities. 2015 net earnings included $1.2 million in gain on sales of securities and $160,000 of income from a death benefit on bank owned life insurance. Excluding these non-operating revenues and expenses, net earnings available to common shareholders decreased $6.3 million in year-over-year comparison. The $8.3 million increase in loan loss provision and a $2.5 million decrease in revenues were partially offset by a $1.4 million decrease in operating noninterest expenses and a $3.3 million decrease in income tax expense.
Excluding non-operating income, decreases in noninterest income consisted primarily of a $1.1 million decrease in service charges on deposit accounts (primarily NSF fees) and a $121,000 decrease in third party investment advisory income, which were partially offset by a $141,000 increase in ATM and debit card income and a $208,000 increase in mortgage banking fees. Excluding the non-operating expenses in 2014, decreases in noninterest expense primarily included $1.7 million in salaries and benefits costs, $236,000 in credit reporting expense and $191,000 in the cost of printing and supplies. The decreased expenses were partially offset by a $274,000 increase in legal and professional fees and a $463,000 increase in FDIC premiums. The decrease in salaries and benefits costs in year-to-date comparison was primarily due to a $636,000 decrease in group health costs as well as a reduction in the number of employees on a full-time equivalent basis by 13 during 2015, from 549 at year end 2014 to 536 at year end 2015. Also contributing to the decrease in salaries and benefits costs was a $553,000 reduction in incentives related to the Annual Incentive Compensation Plan ("AICP"). Since the Company did not achieve its goals as set forth in the AICP, no benefits will be paid out under the plan for 2015.
In year-to-date comparison, FTE net interest income decreased $1.6 million primarily due to a $1.2 million decrease in interest earned on investment securities. The average volume of investment securities decreased $39.0 million in year-over-year comparison. Interest income on loans decreased $694,000 in year-to-date comparison primarily due to a $1.2 million reduction in purchase accounting adjustments on acquired loans. The average volume of loans increased $79.2 million in year-over-year comparison, and the average yield on loans decreased 42 basis points, from 5.96% to 5.54%. The average yield on total earning assets decreased in year-over-year comparison, from 4.97% at December 31, 2014 to 4.66% at December 31, 2015. The purchase accounting adjustments added 28 basis points to the average yield on loans for the year ended December 31, 2014 and 16 basis points for the year ended December 31, 2015. Excluding purchase accounting adjustments, the average yield on earning assets decreased 23 basis points, from 4.77% at December 31, 2014 to 4.54% at December 31, 2015.
Interest expense decreased $226,000 in year-over-year comparison primarily due to the redemption of trust preferred securities in the third quarter of 2014. The average rate paid on interest-bearing liabilities decreased 3 basis points in year-over-year comparison, from 0.45% at December 31, 2014 to 0.42% at December 31, 2015. Excluding purchase accounting adjustments, the average rate paid on interest-bearing liabilities decreased 5 basis points, from 0.50% at December 31, 2014 to 0.45% at December 31, 2015. The FTE net interest margin decreased 29 basis points, from 4.63% for the year ended December 31, 2014 to 4.34% for the year ended December 31, 2015. Excluding purchase accounting adjustments, the FTE net
interest margin decreased 19 basis points, from 4.39% to 4.20% for the years ended December 31, 2014 and 2015, respectively, primarily due to a decline in the average rate earned on loans.
Dividends
MidSouth’s Board of Directors announced a cash dividend was declared in the amount of $0.09 per share to be paid on its common stock on April 1, 2016 to shareholders of record as of the close of business on March 15, 2016. Additionally, a quarterly cash dividend of 1.00% per preferred share on its 4.00% Non-Cumulative Perpetual Convertible Preferred Stock, Series C was declared payable on April 15, 2016 to shareholders of record as of the close of business on April 1, 2016.
About MidSouth Bancorp, Inc.
MidSouth Bancorp, Inc. is a financial holding company headquartered in Lafayette, Louisiana, with assets of $1.9 billion as of December 31, 2015. MidSouth Bancorp, Inc. trades on the NYSE under the symbol “MSL.” Through its wholly owned subsidiary, MidSouth Bank, N.A., MidSouth offers a full range of banking services to commercial and retail customers in Louisiana and Texas. MidSouth Bank currently has 58 locations in Louisiana and Texas and is connected to a worldwide ATM network that provides customers with access to more than 55,000 surcharge-free ATMs. Additional corporate information is available at MidSouthBank.com.
Forward-Looking Statements
Certain statements contained herein are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 and subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, which involve risks and uncertainties. These statements include, among others, the expected loan loss provision and future operating results. Actual results may differ materially from the results anticipated in these forward-looking statements. Factors that might cause such a difference include, among other matters, changes in interest rates and market prices that could affect the net interest margin, asset valuation, and expense levels; changes in local economic and business conditions, including, without limitation, changes related to the oil and gas industries, that could adversely affect customers and their ability to repay borrowings under agreed upon terms, adversely affect the value of the underlying collateral related to their borrowings, and reduce demand for loans; the timing and ability to reach any agreement to restructure nonaccrual loans; increased competition for deposits and loans which could affect compositions, rates and terms; the timing and impact of future acquisitions, the success or failure of integrating operations, and the ability to capitalize on growth opportunities upon entering new markets; loss of critical personnel and the challenge of hiring qualified personnel at reasonable compensation levels; legislative and regulatory changes, including changes in banking, securities and tax laws and regulations and their application by our regulators, changes in the scope and cost of FDIC insurance and other coverage; and other factors discussed under the heading “Risk Factors” in MidSouth’s Annual Report on Form 10-K for the year ended December 31, 2014 filed with the SEC on March 13, 2015 and in its other filings with the SEC. MidSouth does not undertake any obligation to publicly update or revise any of these forward-looking statements, whether to reflect new information, future events or otherwise, except as required by law.
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MIDSOUTH BANCORP, INC. and SUBSIDIARIES |
Condensed Consolidated Financial Information (unaudited) |
(in thousands except per share data) |
| | | | | |
| | Quarter | | Quarter | | Quarter | | Quarter | | Quarter |
| | Ended | | Ended | | Ended | | Ended | | Ended |
EARNINGS DATA | | 12/31/2015 | | 9/30/2015 | | 6/30/2015 | | 3/31/2015 | | 12/31/2014 |
Total interest income | | $ | 19,886 |
| | $ | 20,532 |
| | $ | 20,798 |
| | $ | 20,681 |
| | $ | 21,477 |
|
Total interest expense | | 1,349 |
| | 1,391 |
| | 1,417 |
| | 1,424 |
| | 1,317 |
|
Net interest income | | 18,537 |
| | 19,141 |
| | 19,381 |
| | 19,257 |
| | 20,160 |
|
FTE net interest income | | 18,806 |
| | 19,423 |
| | 19,676 |
| | 19,565 |
| | 20,496 |
|
Provision for loan losses | | 3,000 |
| | 3,800 |
| | 1,100 |
| | 6,000 |
| | 2,700 |
|
Non-interest income | | 4,575 |
| | 4,768 |
| | 6,137 |
| | 4,841 |
| | 4,991 |
|
Non-interest expense | | 17,508 |
| | 16,492 |
| | 16,976 |
| | 16,161 |
| | 17,268 |
|
Earnings before income taxes | | 2,604 |
| | 3,617 |
| | 7,442 |
| | 1,937 |
| | 5,183 |
|
Income tax expense | | 766 |
| | 1,028 |
| | 2,343 |
| | 446 |
| | 1,519 |
|
Net earnings | | 1,838 |
| | 2,589 |
| | 5,099 |
| | 1,491 |
| | 3,664 |
|
Dividends on preferred stock | | 171 |
| | 172 |
| | 172 |
| | 173 |
| | 174 |
|
Net earnings available to common shareholders | | $ | 1,667 |
| | $ | 2,417 |
| | $ | 4,927 |
| | $ | 1,318 |
| | $ | 3,490 |
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PER COMMON SHARE DATA | | | | | | | | | | |
Basic earnings per share | | 0.15 |
| | 0.21 |
| | 0.43 |
| | 0.12 |
| | 0.31 |
|
Diluted earnings per share | | 0.15 |
| | 0.21 |
| | 0.42 |
| | 0.12 |
| | 0.30 |
|
Diluted earnings per share, operating (Non-GAAP)(*) | | 0.15 |
| | 0.21 |
| | 0.35 |
| | 0.11 |
| | 0.31 |
|
Quarterly dividends per share | | 0.09 |
| | 0.09 |
| | 0.09 |
| | 0.09 |
| | 0.09 |
|
Book value at end of period | | 15.14 |
| | 15.21 |
| | 15.04 |
| | 14.92 |
| | 14.78 |
|
Tangible book value at period end (Non-GAAP)(*) | | 10.92 |
| | 10.97 |
| | 10.78 |
| | 10.63 |
| | 10.46 |
|
Market price at end of period | | 9.08 |
| | 11.70 |
| | 15.26 |
| | 14.75 |
| | 17.34 |
|
Shares outstanding at period end | | 11,362,150 |
| | 11,361,839 |
| | 11,359,396 |
| | 11,349,285 |
| | 11,340,736 |
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Weighted average shares outstanding | | | | | | | | | | |
Basic | | 11,281,286 |
| | 11,311,841 |
| | 11,323,506 |
| | 11,317,667 |
| | 11,314,690 |
|
Diluted | | 11,281,286 |
| | 11,830,540 |
| | 11,849,683 |
| | 11,351,239 |
| | 11,933,388 |
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AVERAGE BALANCE SHEET DATA | | | | | | | | | | |
Total assets | | $ | 1,938,235 |
| | $ | 1,949,352 |
| | $ | 1,976,574 |
| | $ | 1,966,752 |
| | $ | 1,929,750 |
|
Loans and leases | | 1,271,106 |
| | 1,285,991 |
| | 1,312,359 |
| | 1,298,317 |
| | 1,264,011 |
|
Total deposits | | 1,557,272 |
| | 1,559,308 |
| | 1,593,318 |
| | 1,592,153 |
| | 1,563,006 |
|
Total common equity | | 173,950 |
| | 173,466 |
| | 170,885 |
| | 170,638 |
| | 167,430 |
|
Total tangible common equity (Non-GAAP)(*) | | 125,919 |
| | 125,156 |
| | 122,299 |
| | 121,778 |
| | 118,291 |
|
Total equity | | 215,072 |
| | 214,623 |
| | 212,112 |
| | 211,985 |
| | 208,816 |
|
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SELECTED RATIOS | | | | | | | | | | |
Annualized return on average assets, operating (Non-GAAP)(*) | | 0.34 | % | | 0.49 | % | | 0.82 | % | | 0.26 | % | | 0.74 | % |
Annualized return on average common equity, operating (Non-GAAP)(*) | | 3.80 | % | | 5.53 | % | | 9.47 | % | | 2.95 | % | | 8.51 | % |
Annualized return on average tangible common equity, operating (Non-GAAP)(*) | | 5.25 | % | | 7.66 | % | | 13.23 | % | | 4.14 | % | | 12.04 | % |
Pre-tax, pre-provision annualized return on average assets, operating (Non-GAAP)(*) | | 1.15 | % | | 1.51 | % | | 1.47 | % | | 1.61 | % | | 1.65 | % |
Efficiency ratio, operating (Non-GAAP)(*) | | 75.69 | % | | 68.65 | % | | 69.89 | % | | 67.48 | % | | 67.76 | % |
Average loans to average deposits | | 81.62 | % | | 82.47 | % | | 82.37 | % | | 81.54 | % | | 80.87 | % |
Taxable-equivalent net interest margin | | 4.22 | % | | 4.34 | % | | 4.38 | % | | 4.44 | % | | 4.65 | % |
Tier 1 leverage capital ratio | | 10.10 | % | | 9.98 | % | | 9.79 | % | | 9.63 | % | | 9.52 | % |
| | | | | | | | | | |
CREDIT QUALITY | | | | | | | | | | |
Allowance for loan and lease losses (ALLL) as a % of total loans | | 1.50 | % | | 1.46 | % | | 1.24 | % | | 1.23 | % | | 0.87 | % |
Nonperforming assets to tangible equity + ALLL | | 29.54 | % | | 30.51 | % | | 16.18 | % | | 9.87 | % | | 8.83 | % |
Nonperforming assets to total loans, other real estate owned and other repossessed assets | | 4.29 | % | | 4.32 | % | | 2.24 | % | | 1.34 | % | | 1.17 | % |
Annualized QTD net charge-offs to total loans | | 0.92 | % | | 0.28 | % | | 0.34 | % | | 0.36 | % | | 0.28 | % |
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(*) See reconciliation of Non-GAAP financial measures on pages 17-21. |
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MIDSOUTH BANCORP, INC. and SUBSIDIARIES |
Condensed Consolidated Financial Information (unaudited) |
(in thousands) |
| | | | | | | | | | |
| | | | | | |
BALANCE SHEET | | December 31, | | September 30, | | June 30, | | March 31, | | December 31, |
| | 2015 | | 2015 | | 2015 | | 2015 | | 2014 |
Assets | | | | | | | | | | |
Cash and cash equivalents | | $ | 89,201 |
| | $ | 125,437 |
| | $ | 82,636 |
| | $ | 104,402 |
| | $ | 86,872 |
|
Securities available-for-sale | | 318,159 |
| | 285,485 |
| | 300,335 |
| | 299,690 |
| | 276,984 |
|
Securities held-to-maturity | | 116,792 |
| | 121,043 |
| | 126,529 |
| | 137,592 |
| | 141,201 |
|
Total investment securities | | 434,951 |
| | 406,528 |
| | 426,864 |
| | 437,282 |
| | 418,185 |
|
Other investments | | 11,188 |
| | 12,063 |
| | 10,598 |
| | 9,644 |
| | 9,990 |
|
Total loans | | 1,263,645 |
| | 1,301,452 |
| | 1,294,392 |
| | 1,310,929 |
| | 1,284,431 |
|
Allowance for loan losses | | (19,011 | ) | | (18,939 | ) | | (16,048 | ) | | (16,060 | ) | | (11,226 | ) |
Loans, net | | 1,244,634 |
| | 1,282,513 |
| | 1,278,344 |
| | 1,294,869 |
| | 1,273,205 |
|
Premises and equipment | | 69,105 |
| | 68,718 |
| | 69,263 |
| | 69,762 |
| | 69,958 |
|
Goodwill and other intangibles | | 47,899 |
| | 48,175 |
| | 48,452 |
| | 48,729 |
| | 49,005 |
|
Other assets | | 30,755 |
| | 30,874 |
| | 32,627 |
| | 30,570 |
| | 29,525 |
|
Total assets | | $ | 1,927,733 |
| | $ | 1,974,308 |
| | $ | 1,948,784 |
| | $ | 1,995,258 |
| | $ | 1,936,740 |
|
| | |
| | | | | | | | |
| | | | | | | | | | |
Liabilities and Shareholders' Equity | | | | | | | | | | |
Non-interest bearing deposits | | $ | 374,261 |
| | $ | 406,118 |
| | $ | 408,742 |
| | $ | 421,897 |
| | $ | 390,863 |
|
Interest-bearing deposits | | 1,176,589 |
| | 1,137,303 |
| | 1,149,508 |
| | 1,194,201 |
| | 1,194,371 |
|
Total deposits | | 1,550,850 |
| | 1,543,421 |
| | 1,558,250 |
| | 1,616,098 |
| | 1,585,234 |
|
Securities sold under agreements to repurchase | | 85,957 |
| | 92,085 |
| | 84,547 |
| | 87,346 |
| | 62,098 |
|
Short-term FHLB advances | | 25,000 |
| | 70,000 |
| | 40,000 |
| | 25,000 |
| | 25,000 |
|
Other borrowings | | 25,851 |
| | 25,958 |
| | 26,064 |
| | 26,171 |
| | 26,277 |
|
Junior subordinated debentures | | 22,167 |
| | 22,167 |
| | 22,167 |
| | 22,167 |
| | 22,167 |
|
Other liabilities | | 4,771 |
| | 6,713 |
| | 5,720 |
| | 7,820 |
| | 6,952 |
|
Total liabilities | | 1,714,596 |
| | 1,760,344 |
| | 1,736,748 |
| | 1,784,602 |
| | 1,727,728 |
|
Total shareholders' equity | | 213,137 |
| | 213,964 |
| | 212,036 |
| | 210,656 |
| | 209,012 |
|
Total liabilities and shareholders' equity | | $ | 1,927,733 |
| | $ | 1,974,308 |
| | $ | 1,948,784 |
| | $ | 1,995,258 |
| | $ | 1,936,740 |
|
|
| | | | | | | | | | | | | | | | | | | | |
MIDSOUTH BANCORP, INC. and SUBSIDIARIES | | | | | |
Condensed Consolidated Financial Information (unaudited) |
(in thousands except per share data) |
| | | | | | | | | | |
| | | | | | |
EARNINGS STATEMENT | | Three Months Ended |
| | 12/31/2015 | | 9/30/2015 | | 6/30/2015 | | 3/31/2015 | | 12/31/2014 |
| | | | | | | | | | |
Interest income: | | | | | | | | | | |
Loans, including fees | | $ | 16,914 |
| | $ | 17,413 |
| | $ | 17,709 |
| | $ | 17,717 |
| | $ | 18,045 |
|
Investment securities | | 2,440 |
| | 2,386 |
| | 2,412 |
| | 2,509 |
| | 2,566 |
|
Accretion of purchase accounting adjustments | | 405 |
| | 579 |
| | 559 |
| | 337 |
| | 757 |
|
Other interest income | | 127 |
| | 154 |
| | 118 |
| | 118 |
| | 109 |
|
Total interest income | | 19,886 |
| | 20,532 |
| | 20,798 |
| | 20,681 |
| | 21,477 |
|
| | | | | | | | | | |
Interest expense: | | | | | | | | | | |
Deposits | | 850 |
| | 903 |
| | 949 |
| | 984 |
| | 973 |
|
Borrowings | | 442 |
| | 448 |
| | 436 |
| | 418 |
| | 401 |
|
Junior subordinated debentures | | 162 |
| | 150 |
| | 151 |
| | 150 |
| | 80 |
|
Accretion of purchase accounting adjustments | | (105 | ) | | (110 | ) | | (119 | ) | | (128 | ) | | (137 | ) |
Total interest expense | | 1,349 |
| | 1,391 |
| | 1,417 |
| | 1,424 |
| | 1,317 |
|
| | | | | | | | | | |
Net interest income | | 18,537 |
| | 19,141 |
| | 19,381 |
| | 19,257 |
| | 20,160 |
|
Provision for loan losses | | 3,000 |
| | 3,800 |
| | 1,100 |
| | 6,000 |
| | 2,700 |
|
Net interest income after provision for loan losses | | 15,537 |
| | 15,341 |
| | 18,281 |
| | 13,257 |
| | 17,460 |
|
| | | | | | | | | | |
Noninterest income: | | | | | | | | | | |
Service charges on deposit accounts | | 2,148 |
| | 2,231 |
| | 2,137 |
| | 2,120 |
| | 2,395 |
|
ATM and debit card income | | 1,821 |
| | 1,823 |
| | 1,865 |
| | 1,841 |
| | 1,834 |
|
Gain on securities, net (non-operating)(*) | | — |
| | — |
| | 1,128 |
| | 115 |
| | — |
|
Mortgage lending | | 123 |
| | 197 |
| | 145 |
| | 153 |
| | 151 |
|
Income from death benefit on bank owned life insurance (non-operating)(*) | | — |
| | — |
| | 160 |
| | — |
| | — |
|
Other charges and fees | | 483 |
| | 517 |
| | 702 |
| | 612 |
| | 611 |
|
Total non-interest income | | 4,575 |
| | 4,768 |
| | 6,137 |
| | 4,841 |
| | 4,991 |
|
| | | | | | | | | | |
Noninterest expense: | | | | | | | | | | |
Salaries and employee benefits | | 8,244 |
| | 7,653 |
| | 8,197 |
| | 7,942 |
| | 8,259 |
|
Occupancy expense | | 3,687 |
| | 3,815 |
| | 3,865 |
| | 3,685 |
| | 3,750 |
|
ATM and debit card | | 825 |
| | 770 |
| | 693 |
| | 663 |
| | 699 |
|
Legal and professional fees | | 448 |
| | 385 |
| | 382 |
| | 345 |
| | 330 |
|
FDIC premiums | | 510 |
| | 391 |
| | 331 |
| | 281 |
| | 268 |
|
Marketing | | 452 |
| | 408 |
| | 417 |
| | 287 |
| | 543 |
|
Corporate development | | 453 |
| | 371 |
| | 387 |
| | 320 |
| | 381 |
|
Data processing | | 488 |
| | 476 |
| | 467 |
| | 457 |
| | 462 |
|
Printing and supplies | | 215 |
| | 228 |
| | 255 |
| | 225 |
| | 280 |
|
Expenses on ORE, net | | 79 |
| | 119 |
| | 99 |
| | 25 |
| | 83 |
|
Amortization of core deposit intangibles | | 276 |
| | 277 |
| | 276 |
| | 277 |
| | 276 |
|
Efficiency consultant expenses (non-operating)(*) | | — |
| | — |
| | — |
| | — |
| | 156 |
|
Other non-interest expense | | 1,831 |
| | 1,599 |
| | 1,607 |
| | 1,654 |
| | 1,781 |
|
Total non-interest expense | | 17,508 |
| | 16,492 |
| | 16,976 |
| | 16,161 |
| | 17,268 |
|
Earnings before income taxes | | 2,604 |
| | 3,617 |
| | 7,442 |
| | 1,937 |
| | 5,183 |
|
Income tax expense | | 766 |
| | 1,028 |
| | 2,343 |
| | 446 |
| | 1,519 |
|
Net earnings | | 1,838 |
| | 2,589 |
| | 5,099 |
| | 1,491 |
| | 3,664 |
|
Dividends on preferred stock | | 171 |
| | 172 |
| | 172 |
| | 173 |
| | 174 |
|
Net earnings available to common shareholders | | $ | 1,667 |
| | $ | 2,417 |
| | $ | 4,927 |
| | $ | 1,318 |
| | $ | 3,490 |
|
| | | | | | | | | | |
Earnings per common share, diluted | | $ | 0.15 |
| | $ | 0.21 |
| | $ | 0.42 |
| | $ | 0.12 |
| | $ | 0.30 |
|
| | | | | | | | | | |
Operating earnings per common share, diluted (Non-GAAP)(*) | | $ | 0.15 |
| | $ | 0.21 |
| | $ | 0.35 |
| | $ | 0.11 |
| | $ | 0.31 |
|
| | | | | | | | | | |
(*) See reconciliation of Non-GAAP financial measures on pages 17-21. |
|
| | | | | | | | | | | | | | | | | | | | | | | | | | |
MIDSOUTH BANCORP, INC. and SUBSIDIARIES |
Condensed Consolidated Financial Information (unaudited) |
(in thousands) |
| | | |
COMPOSITION OF LOANS | | December 31, | | Percent | | September 30, | | June 30, | | March 31, | | December 31, | | Percent |
| 2015 | | of Total | | 2015 | | 2015 | | 2015 | | 2014 | | of Total |
Commercial, financial, and agricultural | | $ | 454,028 |
| | 35.93 | % | | $ | 482,452 |
| | $ | 471,397 |
| | $ | 484,508 |
| | $ | 467,147 |
| | 36.37 | % |
Lease financing receivable | | 1,968 |
| | 0.16 | % | | 4,790 |
| | 5,561 |
| | 6,350 |
| | 4,857 |
| | 0.38 | % |
Real estate - construction | | 74,952 |
| | 5.93 | % | | 74,279 |
| | 79,176 |
| | 76,964 |
| | 68,577 |
| | 5.34 | % |
Real estate - commercial | | 471,141 |
| | 37.28 | % | | 473,319 |
| | 469,022 |
| | 471,737 |
| | 467,172 |
| | 36.37 | % |
Real estate - residential | | 149,064 |
| | 11.80 | % | | 151,667 |
| | 153,820 |
| | 153,647 |
| | 154,602 |
| | 12.04 | % |
Installment loans to individuals | | 111,009 |
| | 8.78 | % | | 113,199 |
| | 113,626 |
| | 115,284 |
| | 119,328 |
| | 9.29 | % |
Other | | 1,483 |
| | 0.12 | % | | 1,746 |
| | 1,790 |
| | 2,439 |
| | 2,748 |
| | 0.21 | % |
| | | | | | | | | | | | | | |
Total loans | | $ | 1,263,645 |
| | | | $ | 1,301,452 |
| | $ | 1,294,392 |
| | $ | 1,310,929 |
| | $ | 1,284,431 |
| | |
| | | | | | | | | | | | | | |
COMPOSITION OF DEPOSITS | | | | | | | | | | | | | | |
| December 31, | | Percent | | September 30, | | June 30, | | March 31, | | December 31, | | Percent |
| | 2015 | | of Total | | 2015 | | 2015 | | 2015 | | 2014 | | of Total |
Noninterest bearing | | $ | 374,261 |
| | 24.13 | % | | $ | 406,118 |
| | $ | 408,742 |
| | $ | 421,897 |
| | $ | 390,863 |
| | 24.66 | % |
NOW & Other | | 475,346 |
| | 30.65 | % | | 448,938 |
| | 458,338 |
| | 480,454 |
| | 469,627 |
| | 29.62 | % |
Money Market/Savings | | 531,449 |
| | 34.27 | % | | 468,297 |
| | 453,902 |
| | 463,625 |
| | 473,290 |
| | 29.86 | % |
Time Deposits of less than $100,000 | | 81,638 |
| | 5.26 | % | | 85,589 |
| | 90,348 |
| | 94,730 |
| | 96,577 |
| | 6.09 | % |
Time Deposits of $100,000 or more | | 88,156 |
| | 5.68 | % | | 134,479 |
| | 146,920 |
| | 155,392 |
| | 154,877 |
| | 9.77 | % |
| | | | | | | | | | | | | | |
Total deposits | | $ | 1,550,850 |
| | | | $ | 1,543,421 |
| | $ | 1,558,250 |
| | $ | 1,616,098 |
| | $ | 1,585,234 |
| | |
| | | | | | | | | | | | | | |
ASSET QUALITY DATA | | | | | | | | | | | | | | |
| December 31, | | | | September 30, | | June 30, | | March 31, | | December 31, | | |
| | 2015 | | | | 2015 | | 2015 | | 2015 | | 2014 | | |
Nonaccrual loans | | $ | 50,051 |
| | | | $ | 51,616 |
| | $ | 23,873 |
| | $ | 12,894 |
| | $ | 10,701 |
| | |
Loans past due 90 days and over | | 147 |
| | | | 82 |
| | 609 |
| | 40 |
| | 187 |
| | |
Total nonperforming loans | | 50,198 |
| | | | 51,698 |
| | 24,482 |
| | 12,934 |
| | 10,888 |
| | |
Other real estate | | 4,187 |
| | | | 4,661 |
| | 4,542 |
| | 4,589 |
| | 4,234 |
| | |
Other repossessed assets | | 38 |
| | | | — |
| | 38 |
| | 43 |
| | — |
| | |
Total nonperforming assets | | $ | 54,423 |
| | | | $ | 56,359 |
| | $ | 29,062 |
| | $ | 17,566 |
| | $ | 15,122 |
| | |
| | | | | | | | | | | | | | |
Troubled debt restructurings, accruing | | $ | 164 |
| | | | $ | 168 |
| | $ | 21,529 |
| | $ | 173 |
| | $ | 176 |
| | |
| | | | | | | | | | | | | | |
Nonperforming assets to total assets | | 2.82 | % | | | | 2.85 | % | | 1.49 | % | | 0.88 | % | | 0.78 | % | | |
Nonperforming assets to total loans + ORE + other repossessed assets | | 4.29 | % | | | | 4.32 | % | | 2.24 | % | | 1.34 | % | | 1.17 | % | | |
ALLL to nonperforming loans | | 37.87 | % | | | | 36.63 | % | | 65.55 | % | | 124.17 | % | | 103.10 | % | | |
ALLL to total loans | | 1.50 | % | | | | 1.46 | % | | 1.24 | % | | 1.23 | % | | 0.87 | % | | |
| | | | | | | | | | | | | | |
Quarter-to-date charge-offs | | $ | 3,091 |
| | | | $ | 1,000 |
| | $ | 1,151 |
| | $ | 1,332 |
| | $ | 985 |
| | |
Quarter-to-date recoveries | | 163 |
| | | | 91 |
| | 39 |
| | 166 |
| | 86 |
| | |
Quarter-to-date net charge-offs | | $ | 2,928 |
| | | | $ | 909 |
| | $ | 1,112 |
| | $ | 1,166 |
| | $ | 899 |
| | |
Annualized QTD net charge-offs to total loans | | 0.92 | % | | | | 0.28 | % | | 0.34 | % | | 0.36 | % | | 0.28 | % | | |
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
MIDSOUTH BANCORP, INC. and SUBSIDIARIES | | | | | | | | | | | | | | | | | | |
Condensed Consolidated Financial Information (unaudited) | | | | | | | | | | | | | | | | | | |
(in thousands) | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | |
YIELD ANALYSIS | | Three Months Ended | | Three Months Ended | | Three Months Ended | | Three Months Ended | | Three Months Ended |
| December 31, 2015 | | September 30, 2015 | | June 30, 2015 | | March 31, 2015 | | December 31, 2014 |
| | | | | | | | | | | | | | | | | | | | |
| | | | Tax | | | | | | Tax | | | | | | Tax | | | | | | Tax | | | | | | Tax | | |
| | Average | | Equivalent | | Yield/ | | Average | | Equivalent | | Yield/ | | Average | | Equivalent | | Yield/ | | Average | | Equivalent | | Yield/ | | Average | | Equivalent | | Yield/ |
| | Balance | | Interest | | Rate | | Balance | | Interest | | Rate | | Balance | | Interest | | Rate | | Balance | | Interest | | Rate | | Balance | | Interest | | Rate |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Taxable securities | | $ | 339,033 |
| | $ | 1,917 |
| | 2.26 | % | | $ | 341,192 |
| | $ | 1,850 |
| | 2.17 | % | | $ | 345,108 |
| | $ | 1,853 |
| | 2.15 | % | | $ | 336,337 |
| | $ | 1,925 |
| | 2.29 | % | | $ | 339,536 |
| | $ | 1,936 |
| | 2.28 | % |
Tax-exempt securities | | 70,548 |
| | 778 |
| | 4.41 | % | | 73,523 |
| | 818 |
| | 4.45 | % | | 76,433 |
| | 854 |
| | 4.47 | % | | 78,948 |
| | 892 |
| | 4.52 | % | | 83,612 |
| | 966 |
| | 4.62 | % |
Total investment securities | | 409,581 |
| | 2,695 |
| | 2.65 | % | | 414,715 |
| | 2,668 |
| | 2.57 | % | | 421,541 |
| | 2,707 |
| | 2.57 | % | | 415,285 |
| | 2,817 |
| | 2.71 | % | | 423,148 |
| | 2,902 |
| | 2.74 | % |
Federal funds sold | | 3,922 |
| | 3 |
| | 0.30 | % | | 3,349 |
| | 1 |
| | 0.12 | % | | 3,228 |
| | 2 |
| | 0.25 | % | | 3,816 |
| | 2 |
| | 0.21 | % | | 3,792 |
| | 2 |
| | 0.21 | % |
Time and interest bearing deposits in other banks | | 73,069 |
| | 52 |
| | 0.28 | % | | 62,086 |
| | 40 |
| | 0.25 | % | | 56,110 |
| | 35 |
| | 0.25 | % | | 59,225 |
| | 37 |
| | 0.25 | % | | 44,841 |
| | 28 |
| | 0.24 | % |
Other investments | | 11,544 |
| | 86 |
| | 2.99 | % | | 10,508 |
| | 113 |
| | 4.30 | % | | 10,057 |
| | 81 |
| | 3.22 | % | | 9,754 |
| | 79 |
| | 3.24 | % | | 11,063 |
| | 79 |
| | 2.86 | % |
Loans | | 1,271,106 |
| | 17,319 |
| | 5.41 | % | | 1,285,991 |
| | 17,992 |
| | 5.55 | % | | 1,312,359 |
| | 18,268 |
| | 5.58 | % | | 1,298,317 |
| | 18,054 |
| | 5.64 | % | | 1,264,011 |
| | 18,802 |
| | 5.90 | % |
Total interest earning assets | | 1,769,222 |
| | 20,155 |
| | 4.52 | % | | 1,776,649 |
| | 20,814 |
| | 4.65 | % | | 1,803,295 |
| | 21,093 |
| | 4.69 | % | | 1,786,397 |
| | 20,989 |
| | 4.77 | % | | 1,746,855 |
| | 21,813 |
| | 4.95 | % |
Non-interest earning assets | | 169,013 |
| | | | | | 172,703 |
| | | | | | 173,279 |
| | | | | | 180,355 |
| | | | | | 182,895 |
| | | | |
Total assets | | $ | 1,938,235 |
| | | | | | $ | 1,949,352 |
| | | | | | $ | 1,976,574 |
| | | | | | $ | 1,966,752 |
| | | | | | $ | 1,929,750 |
| | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Interest-bearing liabilities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Deposits | | $ | 1,156,166 |
| | $ | 836 |
| | 0.29 | % | | $ | 1,150,190 |
| | $ | 883 |
| | 0.30 | % | | $ | 1,181,381 |
| | $ | 921 |
| | 0.31 | % | | $ | 1,192,086 |
| | $ | 947 |
| | 0.32 | % | | $ | 1,158,317 |
| | $ | 927 |
| | 0.32 | % |
Repurchase agreements | | 85,178 |
| | 240 |
| | 1.12 | % | | 89,025 |
| | 249 |
| | 1.11 | % | | 84,545 |
| | 242 |
| | 1.15 | % | | 79,630 |
| | 230 |
| | 1.17 | % | | 69,735 |
| | 207 |
| | 1.18 | % |
Federal funds purchased | | 4 |
| | — |
| | — | % | | — |
| | — |
| | — | % | | — |
| | — |
| | — | % | | — |
| | — |
| | — | % | | — |
| | — |
| | — | % |
Short-term borrowings | | 25,000 |
| | 19 |
| | 0.30 | % | | 31,196 |
| | 16 |
| | 0.20 | % | | 30,604 |
| | 13 |
| | 0.17 | % | | 25,000 |
| | 8 |
| | 0.13 | % | | 28,696 |
| | 12 |
| | 0.16 | % |
Notes payable | | 25,900 |
| | 92 |
| | 1.39 | % | | 26,007 |
| | 93 |
| | 1.40 | % | | 26,114 |
| | 90 |
| | 1.36 | % | | 26,219 |
| | 89 |
| | 1.36 | % | | 26,326 |
| | 91 |
| | 1.35 | % |
Junior subordinated debentures | | 22,167 |
| | 162 |
| | 2.86 | % | | 22,167 |
| | 150 |
| | 2.65 | % | | 22,167 |
| | 151 |
| | 2.69 | % | | 22,167 |
| | 150 |
| | 2.71 | % | | 22,167 |
| | 80 |
| | 1.41 | % |
Total interest bearing liabilities | | 1,314,415 |
| | 1,349 |
| | 0.41 | % | | 1,318,585 |
| | 1,391 |
| | 0.42 | % | | 1,344,811 |
| | 1,417 |
| | 0.42 | % | | 1,345,102 |
| | 1,424 |
| | 0.43 | % | | 1,305,241 |
| | 1,317 |
| | 0.40 | % |
Non-interest bearing liabilities | | 408,748 |
| | | | | | 416,144 |
| | | | | | 419,651 |
| | | | | | 409,665 |
| | | | | | 415,693 |
| | | | |
Shareholders' equity | | 215,072 |
| | | | | | 214,623 |
| | | | | | 212,112 |
| | | | | | 211,985 |
| | | | | | 208,816 |
| | | | |
Total liabilities and shareholders' equity | | $ | 1,938,235 |
| | | | | | $ | 1,949,352 |
| | | | | | $ | 1,976,574 |
| | | | | | $ | 1,966,752 |
| | | | | | $ | 1,929,750 |
| | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net interest income (TE) and spread | | $ | 18,806 |
| | 4.11 | % | | | | $ | 19,423 |
| | 4.23 | % | | | | $ | 19,676 |
| | 4.27 | % | | | | $ | 19,565 |
| | 4.34 | % | | | | $ | 20,496 |
| | 4.55 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net interest margin | | | | 4.22 | % | | | | | | 4.34 | % | | | | | | 4.38 | % | | | | | | 4.44 | % | | | | | | 4.65 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Core net interest margin (Non-GAAP)(*) | | | | 4.09 | % | | | | | | 4.17 | % | | | | | | 4.21 | % | | | | | | 4.32 | % | | | | | | 4.44 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
(*) See reconciliation of Non-GAAP financial measures on pages 17-21. | | | | | | | | | | | | | | | | | | | | | | | | |
|
| | | | | | | | | | | | | | | | | | | | |
MIDSOUTH BANCORP, INC. and SUBSIDIARIES |
Reconciliation of Non-GAAP Financial Measures (unaudited) |
(in thousands except per share data) |
| | | | | | | | | | |
Certain financial information included in the earnings release and the associated Condensed Consolidated Financial Information (unaudited) is determined by methods other than in accordance with GAAP. We are providing disclosure of the reconciliation of these non-GAAP financial measures to the most comparable GAAP financial measures. "Tangible common equity" is defined as total common equity reduced by intangible assets. "Core net interest margin" is defined as reported net interest margin less purchase accounting adjustments. "Annualized return on average assets, operating" is defined as net earnings available to common shareholders adjusted for specified one-time items divided by average assets. "Annualized return on average common equity, operating" is defined as net earnings available to common shareholders adjusted for specified one-time items divided by average common equity. "Annualized return on average tangible common equity, operating" is defined as net earnings available to common shareholders adjusted for specified one-time items divided by average tangible common equity. "Pre-tax, pre-provision annualized return on average assets, operating" is defined as pre-tax, pre-provision earnings adjusted for specified one-time items divided by average assets. "Tangible book value per common share" is defined as tangible common equity divided by total common shares outstanding. "Diluted earnings per share, operating" is defined as net earnings available to common shareholders adjusted for specified one-time items divided by diluted weighted-average shares. The GAAP-based efficiency ratio is measured as noninterest expense as a percentage of net interest income plus noninterest income. The non-GAAP efficiency ratio excludes specified one-time items in addition to securities gains and losses and gains and losses on the sale/valuation of other real estate owned and other assets repossessed. |
We use non-GAAP measures because we believe they are useful for evaluating our financial condition and performance over periods of time, as well as in managing and evaluating our business and in discussions about our performance. We also believe these non-GAAP financial measures provide users of our financial information with a meaningful measure for assessing our financial condition as well as comparison to financial results for prior periods. These results should not be viewed as a substitute for results determined in accordance with GAAP, and are not necessarily comparable to non-GAAP performance measures that other companies may use. |
| | | | | | | | | | |
| | | | | | | | | | |
| | Three Months Ended |
| | December 31, | | September 30, | | June 30, | | March 31, | | December 31, |
| | 2015 | | 2015 | | 2015 | | 2015 | | 2014 |
Average Balance Sheet Data | | | | | | | | | | |
| | | | | | | | | | |
Total average assets | A | $ | 1,938,235 |
| | $ | 1,949,352 |
| | $ | 1,976,574 |
| | $ | 1,966,752 |
| | $ | 1,929,750 |
|
| | | | | | | | | | |
Total equity | | $ | 215,072 |
| | $ | 214,623 |
| | $ | 212,112 |
| | $ | 211,985 |
| | $ | 208,816 |
|
Less preferred equity | | 41,122 |
| | 41,157 |
| | 41,226 |
| | 41,347 |
| | 41,386 |
|
Total common equity | B | $ | 173,950 |
| | $ | 173,466 |
| | $ | 170,886 |
| | $ | 170,638 |
| | $ | 167,430 |
|
Less intangible assets | | 48,031 |
| | 48,310 |
| | 48,587 |
| | 48,860 |
| | 49,139 |
|
Tangible common equity | C | $ | 125,919 |
| | $ | 125,156 |
| | $ | 122,299 |
| | $ | 121,778 |
| | $ | 118,291 |
|
|
| | | | | | | | | | | | | | | | | | | | |
MIDSOUTH BANCORP, INC. and SUBSIDIARIES |
Reconciliation of Non-GAAP Financial Measures (unaudited) (continued) |
(in thousands except per share data) |
| | | | | | | | | | |
| | Three Months Ended |
| | December 31, | | September 30, | | June 30, | | March 31, | | December 31, |
Core Net Interest Margin | | 2015 | | 2015 | | 2015 | | 2015 | | 2014 |
| | | | | | | | | | |
Net interest income (TE) | | $ | 18,806 |
| | $ | 19,423 |
| | $ | 19,676 |
| | $ | 19,565 |
| | $ | 20,496 |
|
Less purchase accounting adjustments | | (510 | ) | | (689 | ) | | (678 | ) | | (465 | ) | | (894 | ) |
Net interest income, excluding purchase accounting adjustments | D | $ | 18,296 |
| | $ | 18,734 |
| | $ | 18,998 |
| | $ | 19,100 |
| | $ | 19,602 |
|
| | | | | | | | | | |
Total average earnings assets | | $ | 1,769,222 |
| | $ | 1,776,649 |
| | $ | 1,803,295 |
| | $ | 1,786,397 |
| | $ | 1,746,855 |
|
Add average balance of loan valuation discount | | 3,712 |
| | 4,269 |
| | 4,888 |
| | 5,179 |
| | 5,764 |
|
Average earnings assets, excluding loan valuation discount | E | $ | 1,772,934 |
| | $ | 1,780,918 |
| | $ | 1,808,183 |
| | $ | 1,791,576 |
| | $ | 1,752,619 |
|
| | | | | | | | | | |
Core net interest margin | D/E | 4.09 | % | | 4.17 | % | | 4.21 | % | | 4.32 | % | | 4.44 | % |
| | | | | | | | | | |
| | Three Months Ended |
| | December 31, | | September 30, | | June 30, | | March 31, | | December 31, |
Return Ratios | | 2015 | | 2015 | | 2015 | | 2015 | | 2014 |
| | | | | | | | | | |
Net earnings available to common shareholders | | $ | 1,667 |
| | $ | 2,417 |
| | $ | 4,927 |
| | $ | 1,318 |
| | $ | 3,490 |
|
Gain on sales of securities, after-tax | | — |
| | — |
| | (733 | ) | | (75 | ) | | — |
|
Efficiency consultant expenses, after-tax | | — |
| | — |
| | — |
| | — |
| | 101 |
|
Income from death benefit on bank owned life insurance | | — |
| | — |
| | (160 | ) | | — |
| | — |
|
Net earnings available to common shareholders, operating | F | $ | 1,667 |
| | $ | 2,417 |
| | $ | 4,034 |
| | $ | 1,243 |
| | $ | 3,591 |
|
| | | | | | | | | | |
Earnings before income taxes | | $ | 2,604 |
| | $ | 3,617 |
| | $ | 7,442 |
| | $ | 1,937 |
| | $ | 5,183 |
|
Gain on sales of securities | | — |
| | — |
| | (1,128 | ) | | (115 | ) | | — |
|
Efficiency consultant expenses | | — |
| | — |
| | — |
| | — |
| | 156 |
|
Loss on disposal of fixed assets | | — |
| | — |
| | — |
| | — |
| | — |
|
Loss on redemption of Trust Preferred Securities | | — |
| | — |
| | — |
| | — |
| | — |
|
Gain on sale of other real estate owned | | — |
| | — |
| | — |
| | — |
| | — |
|
Income from death benefit on bank owned life insurance | | — |
| | — |
| | (160 | ) | | — |
| | — |
|
Provision for loan losses | | 3,000 |
| | 3,800 |
| | 1,100 |
| | 6,000 |
| | 2,700 |
|
Pre-tax, pre-provision earnings, operating | G | $ | 5,604 |
| | $ | 7,417 |
| | $ | 7,254 |
| | $ | 7,822 |
| | $ | 8,039 |
|
| | | | | | | | | | |
Annualized return on average assets, operating | F/A | 0.34 | % | | 0.49 | % | | 0.82 | % | | 0.26 | % | | 0.74 | % |
Annualized return on average common equity, operating | F/B | 3.80 | % | | 5.53 | % | | 9.47 | % | | 2.95 | % | | 8.51 | % |
Annualized return on average tangible common equity, operating | F/C | 5.25 | % | | 7.66 | % | | 13.23 | % | | 4.14 | % | | 12.04 | % |
Pre-tax, pre-provision annualized return on average assets, operating | G/A | 1.15 | % | | 1.51 | % | | 1.47 | % | | 1.61 | % | | 1.65 | % |
|
| | | | | | | | | | | | | | | | | | | | |
MIDSOUTH BANCORP, INC. and SUBSIDIARIES |
Reconciliation of Non-GAAP Financial Measures (unaudited) (continued) |
(in thousands except per share data) |
| | | | | | | | | | |
| | Three Months Ended |
| | December 31, | | September 30, | | June 30, | | March 31, | | December 31, |
Per Common Share Data | | 2015 | | 2015 | | 2015 | | 2015 | | 2014 |
| | | | | | | | | | |
Book value per common share | | $ | 15.14 |
| | $ | 15.21 |
| | $ | 15.04 |
| | $ | 14.92 |
| | $ | 14.78 |
|
Effect of intangible assets per share | | 4.22 |
| | 4.24 |
| | 4.26 |
| | 4.29 |
| | 4.32 |
|
Tangible book value per common share | | $ | 10.92 |
| | $ | 10.97 |
| | $ | 10.78 |
| | $ | 10.63 |
| | $ | 10.46 |
|
| | | | | | | | | | |
Diluted earnings per share | | $ | 0.15 |
| | $ | 0.21 |
| | $ | 0.42 |
| | $ | 0.12 |
| | $ | 0.30 |
|
Effect of gain on sales of securities, after-tax | | — |
| | — |
| | (0.06 | ) | | (0.01 | ) | | — |
|
Effect of efficiency consultant expenses, after-tax | | — |
| | — |
| | — |
| | — |
| | 0.01 |
|
Effect of income from death benefit on bank owned life insurance | | — |
| | — |
| | (0.01 | ) | | — |
| | — |
|
Diluted earnings per share, operating | | $ | 0.15 |
| | $ | 0.21 |
| | $ | 0.35 |
| | $ | 0.11 |
| | $ | 0.31 |
|
| | | | | | | | | | |
| | Three Months Ended |
| | December 31, | | September 30, | | June 30, | | March 31, | | December 31, |
Efficiency Ratio | | 2015 | | 2015 | | 2015 | | 2015 | | 2014 |
| | | | | | | | | | |
Net interest income | | $ | 18,537 |
| | $ | 19,141 |
| | $ | 19,381 |
| | $ | 19,257 |
| | $ | 20,160 |
|
| | | | | | | | | | |
Noninterest income | | $ | 4,575 |
| | $ | 4,768 |
| | $ | 6,137 |
| | $ | 4,841 |
| | $ | 4,991 |
|
Income from death benefit on bank owned life insurance | | — |
| | — |
| | (160 | ) | | — |
| | — |
|
Gain on sales of securities | | — |
| | — |
| | (1,128 | ) | | (115 | ) | | — |
|
Noninterest income (non-GAAP) | | $ | 4,575 |
| | $ | 4,768 |
| | $ | 4,849 |
| | $ | 4,726 |
| | $ | 4,991 |
|
| | | | | | | | | | |
Total revenue | H | $ | 23,112 |
| | $ | 23,909 |
| | $ | 25,518 |
| | $ | 24,098 |
| | $ | 25,151 |
|
Total revenue (non-GAAP) | I | $ | 23,112 |
| | $ | 23,909 |
| | $ | 24,230 |
| | $ | 23,983 |
| | $ | 25,151 |
|
| | | | | | | | | | |
Noninterest expense | J | $ | 17,508 |
| | $ | 16,492 |
| | $ | 16,976 |
| | $ | 16,161 |
| | $ | 17,268 |
|
Efficiency consultant expenses | | — |
| | — |
| | — |
| | — |
| | (156 | ) |
Net (loss) gain on sale/valuation of other real estate owned | | (14 | ) | | (79 | ) | | (41 | ) | | 22 |
| | (69 | ) |
Noninterest expense (non-GAAP) | K | $ | 17,494 |
| | $ | 16,413 |
| | $ | 16,935 |
| | $ | 16,183 |
| | $ | 17,043 |
|
| | | | | | | | | | |
Efficiency ratio (GAAP) | J/H | 75.75 | % | | 68.98 | % | | 66.53 | % | | 67.06 | % | | 68.66 | % |
| | | | | | | | | | |
Efficiency ratio (non-GAAP) | K/I | 75.69 | % | | 68.65 | % | | 69.89 | % | | 67.48 | % | | 67.76 | % |
