BancorpSouth posts earnings, revenue gains

Improvements in loan quality helped Tupelo, Miss.-based BancorpSouth post second quarter per share earnings of 15 cents, handily beating analyst estimates of 4 cents per share.

Second quarter income was $12.8 million, an improvement over the $12.6 million loss in the 2010 quarter. Revenue (interest and non-interest) was $185 million during the quarter, up 11.17% compared to the 2010 period.

For the first half of 2011, the bank — which has 11 branch operations in the Fort Smith area and 51 in Arkansas — posted net income of $12.332 million, an improvement over the $4.164 million loss in the first half of 2010.

"We are pleased to report significant improvement in our financial results for the second quarter of 2011, compared with both the second quarter of 2010 and the first quarter of 2011," Aubrey Patterson, chairman and CEO, said in the earnings statement. "Our stronger earnings are primarily the result of a reduction in our provision for credit losses for the second quarter of 2011 to $32.2 million from $62.4 million for the second quarter of 2010 and $53.5 million for the first quarter of 2011.”

Total assets were $13.4 billion at June 30, unchanged from June 30, 2010. Total deposits were $11.3 billion at June 30, up 0.8% from $11.2 billion at June 30, 2010.

Patterson said non-performing loans fell $45.2 million down to $379.8 million at the end of the second quarter. The bank has also pushed lower the number of loans 90 days past due. As of June 11, such loans totaled $3.98 million, compared to $17.696 million as of June 10, 2010.

The reduction of bad debt has also reduced the bank’s value of loans. As of June 11, the loan value was $9.214 billion, down from $9.646 billion on June 10, 2010.

"Our primary focus going forward is to build on the favorable results achieved for the second quarter by working to resolve credit issues. We are also continuing our work to improve our core operating results by enhancing organic revenue growth and controlling expenses. Recent progress in these efforts has resulted in the hiring of additional mortgage origination staff, and the decision to close 23 branches as a part of our branch optimization project,” Patterson said in the statement.

Nine of the branches closed were in Arkansas, with Mountainburg being the only branch closed in the Fort Smith region. Other Arkansas cities that lost a BancorpSouth branch were Camden, Chidester, El Dorado, Hope, Humnoke, Humphrey, Paragould and Texarkana.

BancorpSouth Inc. is a financial holding company with $13.36 billion in assets. The company operates approximately 312 commercial banking, mortgage, insurance, trust and broker/dealer locations in Alabama, Arkansas, Florida, Louisiana, Mississippi, Missouri, Tennessee and Texas.

BancorpSouth shares (NYSE: BXS) closed Monday (July 25) at $12.56, up 16 cents. The earnings report was released after markets closed. During the past 52 weeks, the share price has ranged from a $16.75 high to a $11.57 low.