BancorpSouth Inc. Reports Fourth Quarter and Year 2000 Earnings
PRNewswire
TUPELO, Miss.

BancorpSouth, Inc. today reported earnings for the fourth quarter and year 2000. For the year ended December 31, 2000, net income was $74.4 million or 88 cents per diluted share, compared to $102.4 million or $1.19 per diluted share for 1999. Net operating income (net income excluding merger-related items) totaled $96.9 million or $1.14 per diluted share, as compared to $103.2 million or $1.20 per diluted share for 1999.

For the fourth quarter of 2000, net income, which includes merger-related items, was $12.3 million or 15 cents per diluted share, compared to $26.4 million or 31 cents per diluted share in the same period of 1999. Net operating income, excluding merger-related items, for the fourth quarter of 2000 was $22.8 million or 27 cents per diluted share, versus $26.5 million or 31 cents per diluted share for the same quarter of 1999.

Fourth quarter results include the effect of restructuring the investment portfolio acquired on August 31, 2000 in the merger with First United Bancshares, Inc. The sale of investment securities resulted in a $9.7 million, 12 cents per diluted share, after-tax loss in the fourth quarter. Other merger-related expenses in the fourth quarter of 2000 totaled $900,000, net of tax, or one cent per diluted share.

BancorpSouth continued to experience growth in total assets, net loans and leases and total deposits in the fourth quarter. At the end of 2000, total assets were $9.0 billion, up 7.2 percent from year-end 1999; net loans and leases were $6.0 billion, up 10.0 percent since the end of 1999; while total deposits were $7.5 billion, up 5.9 percent from year-end 1999.

Aubrey Patterson, Chairman and Chief Executive Officer, commented, "We are well on our way to creating a premier Mid-South regional financial services company. We have the products and services in place to play a major role in assisting our customers to create and to preserve wealth. While we expect that the company will experience increased levels of expenses for the next three quarters until the merger of First United Bancshares is fully integrated with BancorpSouth's operating systems, we believe that our most significant costs relating to the merger and investment security portfolio restructuring are behind us.

By the fourth quarter of 2001, we will begin to realize major cost savings associated with our acquisition of First United Bancshares. Realizing these cost savings as well as generating increased revenue by providing additional financial products and services to existing customers is the formula for increasing shareholder value in 2001 and beyond."

Taxable equivalent net interest earnings were $85.9 million in the fourth quarter of 2000, compared to $86.1 million for the corresponding period in 1999, a .2 percent decrease. The fourth quarter net interest margin was 4.03 percent, compared to 4.36 percent for fourth quarter 1999 and 3.98 percent in third quarter 2000. The cost of interest-bearing liabilities increased to 5.35 percent in the fourth quarter of 2000 from 4.57 percent in fourth quarter 1999, while the taxable equivalent yield on earning assets increased to 8.61 percent from 8.26 percent.

Excluding securities gains and losses, non-interest income totaled $25.6 million for the fourth quarter 2000 versus $24.0 million for fourth quarter 1999, an increase of 6.7 percent. Increases were experienced in deposit service charges, insurance service fees and broker/dealer revenues.

Non-interest expenses for the fourth quarter 2000, before merger-related items were $68.3 million, compared to $65.1 million in 1999, an increase of 5.0 percent. Excluding merger-related charges, the company's efficiency ratio, the ratio on non-interest expenses to net revenues, was 61.2 percent for the quarter and 59.6 percent for the year 2000.

The provision for loan losses in the fourth quarter of 2000 was $5.5 million, compared to $5.2 million for the fourth quarter 1999. Annualized net charge-offs for the fourth quarter of 2000 were .19 percent of average loans, compared to .35 percent of average loans in the year-ago quarter and .70 percent in the third quarter of 2000.

Non-performing assets totaled $51.5 million (.85 percent of net loans) at December 31, 2000, compared to $45.3 million at December 31, 1999 (.82 percent of net loans) and $46.9 million at September 30, 2000 (.79 percent of net loans). The allowance for possible loan losses amounts to 1.34 percent of total net loans at December 31, 2000.

BancorpSouth, Inc. is a financial services company with $9 billion in assets, headquartered in Tupelo, Mississippi. The Company operates approximately 250 commercial banking, insurance, trust, broker/dealer and consumer finance locations in Alabama, Arkansas, Louisiana, Mississippi, Tennessee and Texas.

Certain statements contained in this news release may not be based on 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," "estimate," "expect," "may," "might," "will," "would," or "intend." These forward-looking statements include without limitation, those relating to earnings and shareholder value for 2001 and beyond.

We caution you not to place undue reliance on the forward-looking statements contained in this news release in that actual results could differ materially from those indicated in such forward-looking statements, due to a variety of factors. Those factors include, but are not limited to, changes in economic conditions and government fiscal and monetary policies, fluctuations in prevailing interest rates, changes in BancorpSouth's investment strategy, BancorpSouth's ability to realize anticipated returns on its investment portfolio and other factors described from time to time in BancorpSouth's filings with the Securities and Exchange Commission. We undertake no obligation to update these forward-looking statements to reflect events or circumstances that occur after the date on which such statements were made.

  Selected Financial Data
                              Three Months Ended     Twelve Months Ended
                                  December 31,            December 31,
                                2000        1999        2000        1999
                          (Dollars in thousands except per share amounts)
  Earnings summary
   (excluding merger-
   related costs):
    Net interest revenue      $82,799     $83,087    $327,152    $316,520
    Provision for credit
     losses                     5,497       5,169      20,059      17,812
    Noninterest revenue        25,698      24,099     101,224     100,321
    Noninterest expense        68,315      65,090     262,376     250,664
    Income before income
     taxes                     34,685      36,927     145,941     148,365
    Income tax provision       11,846      10,436      49,040      45,202
    Net income                $22,839     $26,491     $96,901    $103,163
    Earnings per
     share:     Basic           $0.27       $0.31       $1.15       $1.21
                Diluted         $0.27       $0.31       $1.14       $1.20

  Earnings summary (as
   reported):
    Net interest revenue      $82,799     $83,087    $327,152    $316,520
    Provision for credit
     losses                     5,497       5,169      26,166      17,812
    Noninterest revenue        10,014      24,099      85,540     100,321
    Noninterest expense        69,628      65,206     274,189     251,882
    Income before income
     taxes                     17,688      36,811     112,337     147,147
    Income tax provision        5,413      10,392      37,941      44,736
    Net income                $12,275     $26,419     $74,396    $102,411
    Earnings per
     share:     Basic           $0.15       $0.31       $0.88       $1.20
                Diluted         $0.15       $0.31       $0.88       $1.19

  Balance sheet data at
   December 31:
    Total assets                                   $9,044,505  $8,441,697
    Total earning assets                            8,394,275   7,814,004
    Loans and lease
     receivables,
      net of unearned
       discount                                     6,095,314   5,541,961
    Allowance for credit
     losses                                            81,730      74,232
    Total deposits                                  7,480,920   7,066,645
    Common shareholders'
     equity                                           790,086     757,111
    Book value per share                                 9.40        8.84

  Average balance sheet
   data:
    Total assets           $9,062,776  $8,402,617  $8,756,554  $8,139,506
    Total earning assets    8,472,087   7,836,941   8,186,639   7,608,176
    Loans and lease
     receivables,
      net of unearned
       discount             6,073,609   5,506,297   5,831,030   5,263,492
    Total deposits          7,444,430   7,015,409   7,272,998   6,852,868
    Common shareholders'
     equity                   773,495     753,017     761,841     737,543

  Non-performing assets at
   December 31:
    Non-accrual loans                                 $15,572     $16,501
    Loans 90+ days past due                            25,731      17,311
    Restructured loans                                  2,789       1,179
    Other real estate owned                             7,432      10,332

  Net charge-off as a
   percentage of
     average loans
      (annualized)              0.19%       0.35%       0.34%       0.25%

  Performance ratios
   (annualized) (excluding
   merger-related costs)
    Return on average
     assets                     1.01%       1.26%       1.11%       1.27%
    Return on common
     equity                    11.81%      14.07%      12.72%      13.99%

  Performance ratios
   (annualized) (as
   reported):
    Return on average
     assets                     0.54%       1.26%       0.85%       1.26%
    Return on common
     equity                     6.35%      14.03%       9.77%      13.89%

  Net interest margin           4.03%       4.36%       4.14%       4.32%

  Average shares
   outstanding-diluted     84,264,285  85,983,977  84,811,079  86,007,740

                            BancorpSouth, Inc.
                       Consolidated Balance Sheets
                          (dollars in thousands)
                               (Unaudited)

                                             December 31,      December 31,
                                                    2000              1999
                   Assets
     Cash & due from banks                      $314,888          $329,553
     Interest bearing deposits with
      other banks                                 11,687            12,058
     Held-to-maturity securities               1,189,129         1,031,062
     Federal funds sold and securities
       purchased under agreement to
        resell                                   212,925           110,875
     Loans & leases                            6,095,315         5,541,962
              Allowance for credit
               losses                            (81,730)          (74,232)
       Net loans & leases                      6,013,585         5,467,730
     Available-for-sale securities               857,205         1,080,063
     Mortgages held for sale                      27,820            37,513
     Bank premises & equipment                   197,898           171,867
     Accrued interest receivable                  89,605            73,076
     Other real estate owned                       7,892            11,182
     Other assets                                121,871           116,718
          Total assets                        $9,044,505        $8,441,697

                Liabilities
     Demand deposits:
       Non-interest bearing                   $1,009,808          $966,491
       Interest bearing                        1,682,278         1,589,155
       Total demand deposits                   2,692,086         2,555,646
     Savings & time deposits:
       Savings                                   487,035           269,786
       Premium access                            437,556           667,722
       Certificates of deposit                 3,864,243         3,573,492
       Total savings & time deposits           4,788,834         4,511,000
       Total deposits                          7,480,920         7,066,646
     Federal funds purchased and
      securities
       sold under agreement to
        repurchase                               304,502           257,427
     Short-term borrowings                             0            89,000
     Accrued interest payable                     40,611            30,929
     Long-term debt                              152,049           166,247
     Other liabilities                           276,337            74,337
         Total liabilities                     8,254,419         7,684,586

            Shareholders' Equity
     Common stock                                214,484           214,405
     Capital surplus                              71,351            71,777
     Unrealized gain(loss) on
      securities                                  15,202           (14,149)
     Retained earnings                           515,599           486,541
       Less:  Cost of treasury stock             (26,550)           (1,463)
         Total shareholders' equity              790,086           757,111
         Total liabilities &
          shareholders' equity                $9,044,505        $8,441,697

                            BancorpSouth, Inc.
                    Consolidated Statements of Income
              (amounts in thousands, except per share data)
                               (Unaudited)

                                           Quarter Ended
                             Dec-00    Sep-00    Jun-00    Mar-00    Dec-99
  Interest Revenue:
  Loans, including fees    $140,892  $134,910  $129,030  $124,360  $123,471
  Held-to-maturity
   securities:               18,141    15,899    15,307    15,408    14,176
  Available-for-sale
   securities                16,177    21,554    17,696    17,155    18,134
  Short term investments      3,185       962     1,553     1,805     2,210
      Total interest
       revenue              178,395   173,325   163,586   158,729   157,991
  Interest Expense:
  Deposits                   84,709    81,031    74,088    70,536    68,036
  Short term borrowings       7,007     9,058     4,416     4,274     4,183
  Long term borrowings        2,378     2,559     2,442     2,397     2,498
  Other interest expense      1,503       110       182       193       187
      Total interest
       expense               95,596    92,757    81,128    77,400    74,904
      Net interest revenue   82,799    80,567    82,458    81,328    83,087
  Provision for credit
   losses                     5,497    10,656     5,398     4,615     5,169
      Net interest
       revenue, after
       credit loss
       provision             77,301    69,912    77,059    76,713    77,918
  Other Revenue:
  Mortgage lending            1,900     2,493     3,059     3,422     3,466
  Service charges            10,927    10,213    10,234     9,098    10,006
  Life insurance premiums     1,116     1,107     1,058     1,020     1,015
  Trust income                1,625     1,794     1,637     1,644     1,793
  Securities gains, net     (15,549)     (254)       (7)      177        83
  Insurance commissions       4,845     3,717     3,972     3,499     3,281
  Other                       5,151     4,496     5,333     7,814     4,455
      Total other revenue    10,014    23,567    25,286    26,674    24,099
  Other Expense:
  Salaries and employee
   benefits                  33,794    34,070    32,008    33,933    33,068
  Occupancy net of rental
   income                     4,838     4,647     4,409     4,449     4,543
  Equipment                   6,960     6,124     5,506     5,544     5,479
  Telecommunications          2,041     1,868     1,751     1,574     2,019
  Other                      21,994    29,900    20,161    18,619    20,098
      Total other expense    69,628    76,607    63,835    64,120    65,206
      Income before income
       taxes                 14,688    16,871    38,510    39,267    36,811
  Income tax expense          5,413     7,379    12,527    12,622    10,392
      Net Income            $12,275    $9,492   $25,983   $26,645   $26,419
  Net Income Per Share:
   Basic                      $0.15     $0.11     $0.31     $0.31     $0.31
  Diluted                     $0.15     $0.11     $0.31     $0.31     $0.31

                            BancorpSouth, Inc.
                               Consolidated
                           Statements of Income
              (amounts in thousands, except per share data)
                               (Unaudited)

                                                       Year To Date
                                                  Dec-00            Dec-99
  Interest Revenue:
  Loans, including fees                         $529,192          $461,938
  Held-to-maturity securities:                    64,756            54,004
  Available-for-sale securities                   72,582            72,590
  Short term investments                           7,505             8,141
      Total interest revenue                     674,034           596,674
  Interest Expense:
  Deposits                                       310,365           256,755
  Short term borrowings                           24,754            11,518
  Long term borrowings                             9,775            10,616
  Other interest expense                           1,988             1,265
      Total interest expense                     346,883           280,154
      Net interest revenue                       327,152           316,520
  Provision for credit losses                     26,166            17,812
      Net interest revenue, after
       credit loss provision                     300,986           298,708
  Other Revenue:
  Mortgage lending                                10,874            18,289
  Service charges                                 40,472            36,503
  Life insurance premiums                          4,300             3,975
  Trust income                                     6,700             6,400
  Securities gains, net                          (15,632)            4,420
  Insurance commissions                           16,034            13,573
  Other                                           22,793            17,161
      Total other revenue                         85,540           100,321
  Other Expense:
  Salaries and employee benefits                 133,805           124,750
  Occupancy net of rental income                  18,343            16,918
  Equipment                                       24,134            21,611
  Telecommunications                               7,234             7,096
  Other                                           90,673            81,508
      Total other expense                        274,189           251,882
      Income before income taxes                 112,337           147,147
  Income tax expense                              37,941            44,736
      Net Income                                 $74,396          $102,411
  Net Income Per Share: Basic                      $0.88             $1.20
  Diluted                                          $0.88             $1.19

FIRST AND FINAL ADD -- ADDITIONAL TABLES -- TO FOLLOW

SOURCE: BancorpSouth, Inc.

Contact: L. Nash Allen, Jr., 662-680-2330, or Gary C. Bonds,
662-680-2332, both of BancorpSouth