FORM 8-K. BANCORPSOUTH, INC. (Exact name of registrant as specified in its charter)

Transcription

1 FEDERAL DEPOSIT INSURANCE CORPORATION WASHINGTON, DC FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of report (Date of earliest event reported): May 7, 2018 BANCORPSOUTH, INC. (Exact name of registrant as specified in its charter) Mississippi (FDIC Certificate No.) (State or other jurisdiction of incorporation) (IRS Employer Identification No.) One Mississippi Plaza 201 South Spring Street Tupelo, Mississippi (Address of principal executive (Zip Code) offices) Registrant s telephone number, including area code (662) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below): Written communications pursuant to Rule 425 under the Securities Act (17 CFR ) Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR a-12) Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR d-2(b)) Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR e-4(c)) Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR ) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR b-2). Emerging growth company If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

2 Section 7 Regulation FD Item Regulation FD Disclosure. Representatives of BancorpSouth Bank (the Company ) will be conducting investor meetings at the 2018 Gulf South Bank Conference on May 7 and 8, A copy of the presentation to be used is furnished as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference in its entirety. Section 9 Financial Statements and Exhibits Item Financial Statements and Exhibits. (d) Exhibits. EXHIBIT INDEX Exhibit 99.1 Presentation by BancorpSouth Bank

3 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. BANCORPSOUTH, INC. By:/s/ Cathy Freeman Cathy S. Freeman Senior Executive Vice President and Chief Administrative Officer Date: May 7, 2018

4 Exhibit 99.1 BANCORPSOUTH BANK 2018 Gulf South Bank Conference May 7-8, 2018

5 Forward Looking Information Certain statements contained in this presentation may not be based upon historical facts and are 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. These forward-looking statements may be identified by their reference to a future period or periods or by the use of forward-looking terminology such as anticipate, believe, could, estimate, expect, foresee, hope, intend, may, might, plan, will, or would or future or conditional verb tenses and variations or negatives of such terms. These forward-looking statements include, without limitation, those relating to the benefits, costs, synergies and financial and operational impact of the Reorganization on the Company, the benefits, costs, synergies, and financial and operational impact of the CCC and OIB mergers, the acceptance by customers of OIB and CCC of the Company s products and services after the closing of the mergers, the terms, timing and closing of the proposed transaction with Icon Capital Corporation, acceptance by customers of Icon Capital Corporation of the Company s products and services, the opportunities to enhance market share in certain markets and market acceptance of the Company generally in new markets, the Company s ability to operate its regulatory compliance programs consistent with federal, state and local laws, including its Bank Secrecy Act ( BSA ) and anti-money laundering ( AML ) compliance program and its fair lending compliance program, the Company s compliance with the consent order it entered into with the Consumer Financial Protection Bureau and the United States Department of Justice related to the Company s fair lending practices (the Consent Order ), the impact of the Tax Cuts and Jobs Act of 2017 on the Company and its operations and financial performance, amortization expense for intangible assets, goodwill impairments, loan impairment, utilization of appraisals and inspections for real estate loans, maturity, renewal or extension of construction, acquisition and development loans, net interest revenue, fair value determinations, the amount of the Company s non-performing loans and leases, credit quality, credit losses, liquidity, off-balance sheet commitments and arrangements, valuation of mortgage servicing rights, allowance and provision for credit losses, early identification and resolution of credit issues, utilization of non-gaap financial measures, the ability of the Company to collect all amounts due according to the contractual terms of loan agreements, the Company s reserve for losses from representation and warranty obligations, the Company s foreclosure process related to mortgage loans, the resolution of non-performing loans that are collaterally dependent, real estate values, fully-indexed interest rates, interest rate risk, interest rate sensitivity, the impact of interest rates on loan yields, calculation of economic value of equity, impaired loan charge-offs, diversification of the Company s revenue stream, the growth of the Company s insurance business and commission revenue, the growth of the Company s customer base and loan, deposit and fee revenue sources, liquidity needs and strategies, sources of funding, net interest margin, declaration and payment of dividends, the utilization of the Company s share repurchase program, the implementation and execution of cost saving initiatives, improvement in the Company s efficiencies, operating expense trends, future acquisitions, dispositions and other strategic growth opportunities and initiatives and the impact of certain claims and ongoing, pending or threatened litigation, administrative and investigatory matters. The Company cautions readers not to place undue reliance on the forward-looking statements contained in this presentation, in that actual results could differ materially from those indicated in such forward-looking statements as a result of a variety of factors. These factors may include, but are not limited to, the Company s ability to operate its regulatory compliance programs consistent with federal, state and local laws, including its BSA/AML compliance program and its fair lending compliance program, the Company s ability to successfully implement and comply with the Consent Order, the ability of the Company to meet expectations regarding the benefits, costs, synergies, and financial and operational impact of the Reorganization and the CCC and OIB mergers, the possibility that any of the anticipated benefits, costs, synergies and financial and operational improvements of the Reorganization and the OIB and CCC mergers will not be realized or will not be realized as expected, the ability of the Company and Icon to complete the merger transaction, the ability of the Company and Icon to satisfy the conditions to the completion of the merger transaction, including the approval of the merger transaction by Icon s shareholders and the receipt of all regulatory approvals required for the merger transaction on the terms expected in the merger agreement, the ability of the Company and Icon to meet expectations regarding the timing, completion and accounting and tax treatments of the merger transaction, the possibility that any of the anticipated benefits of the merger transaction will not be realized or will not be realized as expected, the failure of the merger transaction to close for any other reason, the effect of the announcement of the merger transaction on the Company s operating results, the possibility that the merger transaction may be more expensive to complete than anticipated, including as a result of unexpected factors or events, the lack of availability of the Bank s filings mandated by the Exchange Act from the SEC s publicly available website after the closing of the Reorganization, the impact of any ongoing, pending or threatened litigation, administrative and investigatory matters involving the Company, conditions in the financial markets and economic conditions generally, the adequacy of the Company s provision and allowance for credit losses to cover actual credit losses, the credit risk associated with real estate construction, acquisition and development loans, limitations on the Company s ability to declare and pay dividends, the availability of capital on favorable terms if and when needed, liquidity risk, governmental regulation, including the Dodd-Frank Act, and supervision of the Company s operations, the short-term and long-term impact of changes to banking capital standards on the Company s regulatory capital and liquidity, the impact of regulations on service charges on the Company s core deposit accounts, the susceptibility of the Company s business to local economic and environmental conditions, the soundness of other financial institutions, changes in interest rates, the impact of monetary policies and economic factors on the Company s ability to attract deposits or make loans, volatility in capital and credit markets, reputational risk, the impact of the Tax Cuts and Jobs Act of 2017 on the Company and its operations and financial performance, the impact of the loss of any key Company personnel, the impact of hurricanes or other adverse weather events, any requirement that the Company write down goodwill or other intangible assets, diversification in the types of financial services the Company offers, the growth of the Company s insurance business and commission revenue, the growth of the Company s loan, deposit and fee revenue sources, the Company s ability to adapt its products and services to evolving industry standards and consumer preferences, competition with other financial services companies, risks in connection with completed or potential acquisitions, dispositions and other strategic growth opportunities and initiatives, the Company s growth strategy, interruptions or breaches in the Company s information system security, the failure of certain third-party vendors to perform, unfavorable ratings by rating agencies, dilution caused by the Company s issuance of any additional shares of its common stock to raise capital or acquire other banks, bank holding companies, financial holding companies and insurance agencies, the utilization of the Company s share repurchase program, the implementation and execution of cost saving initiatives, other factors generally understood to affect the assets, business, cash flows, financial condition, liquidity, prospects and/or results of operations of financial services companies and other factors detailed from time to time in the Company s press and presentations, reports and other filings with the FDIC. Forward-looking statements speak only as of the date that they were made, and, except as required by law, the Company does not undertake any obligation to update or revise forward-looking statements to reflect events or circumstances that occur after the date of this presentation. 2

6 About BancorpSouth Bank (NYSE:BXS) Total assets of $17.2 billion Headquartered in Tupelo, Mississippi 279 full service banking locations reaching throughout an 8-state footprint Customer-focused business model with comprehensive line of financial products and banking services for individuals and small to mid-size businesses Strong core capital base consisting of 100% common equity Market capitalization of $3.3 billion 3 Market Capitalization as of April 30, 2018 Location Count and Total Assets as of March 31, 2018

7 Community Bank Structure 8-State Footprint 279 Full Service Branches 2 Loan Production Offices 31 Insurance Locations (24 Stand Alone) ** * * 95 Mortgage Locations (12 Stand Alone) 28 Wealth Management Locations 4 * Transactions closed effective January 15, 2018 ** Transaction pending

8 Icon Transaction Summary (2) Merger Partner Purchase Price (1) Icon Capital Corporation ( Icon ) and bank subsidiary, Icon Bank of Texas, NA $145.8 million (as of announcement date) Consideration Cost Savings Mark-to-Market Adjustments Core Deposit Intangibles EPS Accretion 4,125,000 shares of BXS common stock and $17.5 million in cash 20% of Icon noninterest expense (75% realized in the first 12 months of combined operations, and 100% thereafter) Estimated 2.0% mark on gross loans Estimated 1.5% of all non-time accounts, 10 year amortization First year of combined operations Initial TBV Dilution Less than 2% TBV Earnback Period Under 3.5 years 5 (1) Based on a BXS closing stock price of $31.10 on 4/17/2018 (2) Transaction subject to customary regulatory approvals and Icon shareholder approval; anticipated closing during second half of 2018; see Forward Looking Information

9 Deposit Market Share Percentage of Total Company 6/30/17 Deposit Market Share ($ in thousands) ICON Capital Corporation Deposits Pro Forma Percentage of Total Company Market YoY Deposit Growth Market BXS Market Share Rank 6/30/17* Total BXS Deposits 6/30/17* Deposits BXS Market Share 2017 (%)* 6/30/17** Pro Forma Deposits 6/30/17 Deposits Pro Forma Market Share Rank 6/30/17 Pro Forma Market Share 2017 (%) 2017 (%) Mississippi 3 $ 5,745, % 10.8% $ - $ 5,745, % % 4.8% Texas 33 2,166, % 0.3% 670,996 2,837, % % 6.4% Arkansas 8 1,651, % 2.6% - 1,651, % 8 2.6% 5.6% Louisiana 7 1,588, % 1.5% - 1,588, % 7 1.5% 2.5% Tennessee 17 1,259, % 0.9% - 1,259, % % 6.6% Alabama , % 0.9% - 915, % % 3.4% Missouri , % 0.2% - 303, % % 6.9% Florida , % 0.0% - 50, % % 4.3% Total $ 13,682, % $ 670,996 $ 14,353, % 6 Source FDIC Market Share Data Note: Deposit Data as of 6/30/17 *Includes Central Community Corporation & Ouachita Bancshares Corp. which closed effective January 15, 2018 **Transaction pending

10 7 Wide Range of Product Offerings

11 Other Product Offerings 8

12 Diversified Revenue Stream Approximately 35% of Total Revenue is Derived from Noninterest Sources Total Revenue of $766.7M* Total Noninterest Revenue of $269.2M* 9 Percentages and amounts based on data for rolling 12 month period ending March 31, 2018 *Excludes positive MSR valuation adjustment of $6.4 million and net securities gains of $0.6 million

13 Q1 Highlights Net income of $53.5 million, or $0.54 per diluted share Completed acquisitions of Central Community Corporation and Ouachita Bancshares Corp. effective January 15, 2018; recorded merger related expenses of $5.7 million for the first quarter Earnings benefitted from a positive pre-tax MSR valuation adjustment of $5.5 million Net operating income excluding MSR of $53.6 million, or $0.54 per diluted share Reported total deposit growth of $240 million, or 8 percent on an annualized basis excluding balances acquired through mergers during the quarter, while organic loan growth for the quarter totaled approximately $50 million or 2 percent on an annualized basis Net interest margin, excluding accretion, increased to 3.60 percent Repurchased 2,073,986 share of outstanding common stock at a weighted average price of $ As of and for the three months ended March 31, 2018 Reconciliation for non-gaap measure included on Slide 17

14 Diluted EPS Growth in Operating Earnings Per Share, Excluding MSR* $0.54 $0.54 Fiscal Year Quarter Ended 11 *Reconciliation for non-gaap measure included on Slide 17

15 Deposit Growth 4 Year Compound Annual Growth Rate of 2.5% 0.31% Fiscal Year Quarter Ended 12 Dollars in Millions Includes Customer Repos

16 Loan Growth 4 Year Compound Annual Growth Rate of 5.4% 4.60% Fiscal Year Quarter Ended 13 Dollars in Millions

17 Noninterest Expense - Operating Operating Expenses Stable While Producing Revenue Growth $211.5 $ % Fiscal Year Quarter Ended 14 Dollars in Millions Certain prior period amounts reclassified to conform with current year presentation *Reconciliation for non-gaap measure included on Slide 17

18 Credit Quality Credit Quality Continues to Remain Strong -0.01% Fiscal Year Quarter Ended 15 Dollars in millions

19 Summary Highlights Record quarterly earnings Completed mergers effective January 15, 2018 Meaningful deposit growth Continued improvement in net interest margin Repurchased approximately 2.1 million shares in the first quarter Current Focus Continue to grow both organically and through strategic opportunities Loans, deposits, and fee revenue sources Challenge expenses and continue to improve efficiency Efficiently manage capital Q & A 16

20 Non-GAAP Reconciliation Management evaluates the Company's capital position and operating performance by utilizing certain financial measures not calculated in accordance with U.S. Generally Accepted Accounting Principles (GAAP), including net operating income, net operating income-excluding MSR, total operating expense, operating earnings per share, and operating earnings per share-excluding MSR. The Company has included these non-gaap financial measures in this presentation for the applicable periods presented. Management believes that the presentation of these non-gaap financial measures (i) provides important supplemental information that contributes to a proper understanding of the Company's capital position and operating performance, (ii) enables a more complete understanding of factors and trends affecting the Company's business and (iii) allows investors to evaluate the Company's performance in a manner similar to management, the financial services industry, bank stock analysts and bank regulators. Reconciliations of these non- GAAP financial measures to the most directly comparable GAAP financial measures are presented in the tables below. These non-gaap financial measures should not be considered as substitutes for GAAP financial measures, and the Company strongly encourages investors to review the GAAP financial measures included in this presentation and not to place undue reliance upon any single financial measure. In addition, because non-gaap financial measures are not standardized, it may not be possible to compare the non-gaap financial measures presented in this presentation with other companies' non-gaap financial measures having the same or similar names. Reconciliation of net operating income and net operating income - excluding MSR to net income: Quarter Year Ended Ended 12/31/ /31/ /31/ /31/ /31/2017 3/31/2018 Net income $ 94,115 $ 116,750 $ 127,491 $ 132,728 $ 153,033 $ 53,491 Plus: Legal charge, net of tax 4,805-10, BSA charge, net of tax - 1, Merger expense, net of tax - 1, ,298 Voluntary early retirement expense, net of tax 6, Write-off of unamortizedtrups issue cost, net of tax 1, Changes due to tax reform Regulatory related charges, net of tax , Less: Securities gains, net of tax , Net operating income $ 107,407 $ 119,722 $ 137,668 $ 142,062 $ 153,077 $ 57,769 Less: MSR market value adjustment, net of tax 5,545 (3,995) (720) 626 1,091 4,153 Net operating income, excluding MSR $ 101,863 $ 123,717 $ 138,388 $ 141,436 $ 151,986 $ 53,616 Average shares outstanding - diluted 95,332 96,302 96,124 94,455 91,755 98,942 Operating earnings per share $ 1.13 $ 1.24 $ 1.43 $ 1.51 $ 1.67 $ 0.58 Operating earnings per share, excluding MSR $ 1.07 $ 1.28 $ 1.44 $ 1.50 $ 1.66 $ 0.54 Reconciliation of total operating expense to total noninterest expense: Quarter Year Ended Ended 12/31/ /31/ /31/ /31/ /31/2017 3/31/2018 Total noninterest expense $ 534,849 $ 518,406 $ 536,312 $ 527,909 $ 507,446 $ 147,701 Less: Legal charge 7,750-16, BSA charge - 3, Merger expense - 1, ,727 Voluntary early retirement expense 10, Write-off of unamortized TRUPS issue cost 2, Regulatory related charges , Total operating expense $ 513,364 $ 513,575 $ 519,788 $ 514,130 $ 506,758 $ 141, All amounts in thousands except per share amounts Certain prior period amounts reclassified to conform with current year presentation

21 BancorpSouth s common stock is listed on the New York Stock Exchange under the symbol BXS. Additional information can be found at As a reminder, all of the Company s Securities Exchange Act filings are made with the Federal Deposit Insurance Corporation and can be found at Investor Inquiries: Will Fisackerly Director of Corporate Finance BancorpSouth Bank will.fisackerly@bxs.com 18 *Reference to BancorpSouth s website does not constitute incorporation by reference of the information contained on the website and is not, and should not, be deemed part of this presentation