TUPELO, Miss., Jan. 23, 2024 (GLOBE NEWSWIRE) -- Renasant Corporation (NYSE: RNST) (the “Company”) today announced earnings results for the fourth quarter of 2023.

(Dollars in thousands, except earnings per share)Three Months Ended Twelve Months Ended
 Dec 31, 2023Sep 30, 2023Dec 31, 2022 Dec 31, 2023Dec 31, 2022
Net income and earnings per share:      
Net income$28,124 $41,833 $46,276  $144,678 $166,068 
After-tax loss on sale of securities (15,711) —  —   (33,927) — 
Basic EPS 0.50  0.75  0.83   2.58  2.97 
Diluted EPS 0.50  0.74  0.82   2.56  2.95 
Impact to diluted EPS from losses on the sale of securities (including impairments) 0.28  —  —   0.60  — 
Adjusted diluted EPS (Non-GAAP)(1) 0.76  0.74  0.89   3.15  3.00 
                 

“The quarter exhibited solid results across the company. We continue to strengthen the balance sheet and remain committed to improving operating leverage,” remarked C. Mitchell Waycaster, Chief Executive Officer of the Company. “Going into 2024, Renasant is well positioned to continue organic growth and pursue our strategic objectives.”

Quarterly Highlights

Earnings

  • Net income for the fourth quarter of 2023 was $28.1 million; diluted EPS was $0.50 and adjusted diluted EPS (Non-GAAP)(1) was $0.76
  • Net interest income (fully tax equivalent) for the fourth quarter of 2023 was $128.6 million, down $1.5 million on a linked quarter basis
  • For the fourth quarter of 2023, net interest margin was 3.33%, down 3 basis points on a linked quarter basis
  • Cost of total deposits was 2.17% for the fourth quarter of 2023, up 19 basis points on a linked quarter basis
  • Noninterest income decreased $17.8 million on a linked quarter basis. The Company determined to sell a portion of its available-for-sale securities portfolio in the fourth quarter of 2023, and as a result the Company recognized pre-tax non-credit related impairment charges of $19.4 million. The impaired securities were sold in the first quarter of 2024 and generated $177 million in proceeds. Noninterest income for the fourth quarter of 2023 also included a one-time payment of $2.3 million related to Renasant's participation in a recovery agreement, which it assumed as part of a previous acquisition
  • The Company extinguished $3.3 million of its subordinated debt, which produced a gain of $0.6 million in the fourth quarter of 2023
  • Mortgage banking income decreased $0.9 million on a linked quarter basis. The mortgage division generated $0.3 billion in interest rate lock volume in the fourth quarter of 2023, a decrease of $0.2 billion. Gain on sale margin was 1.14% for the fourth quarter of 2023, down 41 basis points on a linked quarter basis
  • The Company realized a gain of $0.5 million in the fourth quarter of 2023 related to a holdback on previously sold mortgage servicing rights (“MSR”) assets
  • Noninterest expense increased $3.5 million on a linked quarter basis. Higher salaries and benefits and an FDIC deposit insurance special assessment of $2.7 million contributed to the increase

Balance Sheet

  • Loans increased $183.2 million on a linked quarter basis, representing 6.0% annualized net loan growth
  • Securities decreased $10.0 million on a linked quarter basis due to net cash outflows of $51.0 million for the quarter. As previously mentioned, the Company recorded an impairment charge of $19.4 million on a portion of its securities classified as available-for-sale. The remaining available-for-sale portfolio experienced a positive fair value adjustment of $42.3 million
  • Deposits at December 31, 2023 decreased $80.3 million on a linked quarter basis. Brokered deposits decreased $295.9 million on a linked quarter basis to $461.4 million at December 31, 2023. Noninterest bearing deposits decreased $150.5 million on a linked quarter basis and represented 25.5% of total deposits at December 31, 2023

Capital and Liquidity

  • Book value per share and tangible book value per share (non-GAAP)(1) increased 2.9% and 5.3%, respectively, on a linked quarter basis
  • The Company has a $100 million stock repurchase program that is in effect through October 2024; there was no buyback activity during the fourth quarter of 2023

Credit Quality

  • The Company recorded a provision for credit losses of $2.5 million for the fourth quarter of 2023
  • The ratio of allowance for credit losses on loans to total loans was 1.61% at December 31, 2023
  • The coverage ratio, or the allowance for credit losses on loans to nonperforming loans, was 286.26% at December 31, 2023, compared to 282.24% at September 30, 2023
  • Net loan charge-offs for the fourth quarter of 2023 were $1.7 million, or 0.06% of average loans on an annualized basis
  • Nonperforming loans to total loans decreased to 0.56% at December 31, 2023 compared to 0.58% at September 30, 2023 and criticized loans (which include classified and special mention loans) to total loans decreased to 2.16% at December 31, 2023, compared to 2.27% at September 30, 2023

(1) This is a non-GAAP financial measure. A reconciliation of all non-GAAP financial measures disclosed in this release from GAAP to non-GAAP is included in the tables at the end of this release. The information below under the heading “Non-GAAP Financial Measures” explains why the Company believes the non-GAAP financial measures in this release provide useful information and describes the other purposes for which the Company uses non-GAAP financial measures.

Income Statement

(Dollars in thousands, except per share data)Three Months Ended Twelve Months Ended
 Dec 31,
2023		Sep 30,
2023		Jun 30,
2023		Mar 31,
2023		Dec 31,
2022		 Dec 31,
2023		Dec 31,
2022
Interest income        
Loans held for investment$188,535 $181,129 $173,198 $161,787 $145,360  $704,649 $470,698 
Loans held for sale 3,329  3,751  2,990  1,737  1,688   11,807  9,212 
Securities 10,728  10,669  14,000  15,091  15,241   50,488  53,047 
Other 7,839  10,128  6,978  5,430  2,777   30,375  8,853 
Total interest income 210,431  205,677  197,166  184,045  165,066   797,319  541,810 
Interest expense        
Deposits 77,168  70,906  51,391  32,866  17,312   232,331  35,208 
Borrowings 7,310  7,388  15,559  15,404  9,918   45,661  25,304 
Total interest expense 84,478  78,294  66,950  48,270  27,230   277,992  60,512 
Net interest income 125,953  127,383  130,216  135,775  137,836   519,327  481,298 
Provision for credit losses        
Provision for loan losses 2,518  5,315  3,000  7,960  10,488   18,793  23,788 
Provision for (recovery of) unfunded commitments —  (700) (1,000) (1,500) 183   (3,200) 83 
Total provision for credit losses 2,518  4,615  2,000  6,460  10,671   15,593  23,871 
Net interest income after provision for credit losses 123,435  122,768  128,216  129,315  127,165   503,734  457,427 
Noninterest income 20,356  38,200  17,226  37,293  33,395   113,075  149,253 
Noninterest expense 111,880  108,369  110,165  109,208  101,399   439,622  395,372 
Income before income taxes 31,911  52,599  35,277  57,400  59,161   177,187  211,308 
Income taxes 3,787  10,766  6,634  11,322  12,885   32,509  45,240 
Net income$28,124 $41,833 $28,643 $46,078 $46,276  $144,678 $166,068 
         
Adjusted net income (non-GAAP)(1)$42,887 $41,833 $46,728 $46,078 $50,324  $177,657 $168,886 
Adjusted pre-provision net revenue (“PPNR”) (non-GAAP)(1)$52,614 $57,214 $59,715 $63,860 $72,187  $233,403 $235,993 
         
Basic earnings per share$0.50 $0.75 $0.51 $0.82 $0.83  $2.58 $2.97 
Diluted earnings per share 0.50  0.74  0.51  0.82  0.82   2.56  2.95 
Adjusted diluted earnings per share (non-GAAP)(1) 0.76  0.74  0.83  0.82  0.89   3.15  3.00 
Average basic shares outstanding 56,141,628  56,138,618  56,107,881  56,008,741  55,953,104   56,099,689  55,904,579 
Average diluted shares outstanding 56,611,217  56,523,887  56,395,653  56,270,219  56,335,446   56,448,163  56,214,230 
Cash dividends per common share$0.22 $0.22 $0.22 $0.22 $0.22  $0.88 $0.88 
                       

(1) This is a non-GAAP financial measure. A reconciliation of all non-GAAP financial measures disclosed in this release from GAAP to non-GAAP is included in the tables at the end of this release. The information below under the heading “Non-GAAP Financial Measures” explains why the Company believes the non-GAAP financial measures in this release provide useful information and describes the other purposes for which the Company uses non-GAAP financial measures.

Performance Ratios

 Three Months Ended Twelve Months Ended
 Dec 31,
2023		Sep 30,
2023		Jun 30,
2023		Mar 31,
2023		Dec 31,
2022		 Dec 31,
2023		Dec 31,
2022
Return on average assets0.65%0.96%0.66%1.09%1.11% 0.84%1.00%
Adjusted return on average assets (non-GAAP)(1)0.99 0.96 1.08 1.09 1.20  1.03 1.02 
Return on average tangible assets (non-GAAP)(1)0.71 1.05 0.73 1.19 1.20  0.92 1.09 
Adjusted return on average tangible assets (non-GAAP)(1)1.08 1.05 1.18 1.19 1.30  1.12 1.10 
Return on average equity4.93 7.44 5.18 8.55 8.58  6.50 7.60 
Adjusted return on average equity (non-GAAP)(1)7.53 7.44 8.45 8.55 9.33  7.99 7.73 
Return on average tangible equity (non-GAAP)(1)9.26 13.95 9.91 16.29 15.98  12.29 13.97 
Adjusted return on average tangible equity (non-GAAP)(1)13.94 13.95 15.94 16.29 17.35  15.02 14.20 
Efficiency ratio (fully taxable equivalent)75.11 64.38 73.29 62.11 58.29  68.33 61.88 
Adjusted efficiency ratio (non-GAAP)(1)66.18 63.60 62.98 61.30 56.25  63.48 60.77 
Dividend payout ratio44.00 29.33 43.14 26.83 26.51  34.11 29.63 
                

Capital and Balance Sheet Ratios

 As of
 Dec 31, 2023Sep 30, 2023Jun 30, 2023Mar 31, 2023Dec 31, 2022
Shares outstanding 56,142,207  56,140,713  56,132,478  56,073,658  55,953,104 
Market value per share$33.68 $26.19 $26.13 $30.58 $37.59 
Book value per share 40.92  39.78  39.35  39.01  38.18 
Tangible book value per share (non-GAAP)(1) 22.92  21.76  21.30  20.92  20.02 
Shareholders’ equity to assets 13.23% 13.00% 12.82% 12.52% 12.57%
Tangible common equity ratio (non-GAAP)(1) 7.87  7.55  7.37  7.13  7.01 
Leverage ratio 9.62  9.48  9.22  9.18  9.36 
Common equity tier 1 capital ratio 10.52  10.46  10.30  10.19  10.21 
Tier 1 risk-based capital ratio 11.30  11.25  11.09  10.98  11.01 
Total risk-based capital ratio 14.93  14.91  14.76  14.68  14.63 
                

(1) This is a non-GAAP financial measure. A reconciliation of all non-GAAP financial measures disclosed in this release from GAAP to non-GAAP is included in the tables at the end of this release. The information below under the heading “Non-GAAP Financial Measures” explains why the Company believes the non-GAAP financial measures in this release provide useful information and describes the other purposes for which the Company uses non-GAAP financial measures.

Noninterest Income and Noninterest Expense

(Dollars in thousands)Three Months Ended Twelve Months Ended
 Dec 31,
2023		Sep 30,
2023		Jun 30,
2023		Mar 31,
2023		Dec 31,
2022		 Dec 31,
2023		Dec 31,
2022
Noninterest income        
Service charges on deposit accounts$10,603 $9,743 $9,733 $9,120 $10,445  $39,199 $39,957 
Fees and commissions 4,130  4,108  4,987  4,676  4,470   17,901  17,268 
Insurance commissions 2,583  3,264  2,809  2,446  2,501   11,102  10,754 
Wealth management revenue 5,668  5,986  5,338  5,140  5,237   22,132  22,339 
Mortgage banking income 6,592  7,533  9,771  8,517  5,170   32,413  35,794 
Net losses on sales of securities (including impairments) (19,352) —  (22,438) —  —   (41,790) — 
Gain on extinguishment of debt 620  —  —  —  —   620  — 
BOLI income 2,589  2,469  2,402  3,003  2,487   10,463  9,267 
Other 6,923  5,097  4,624  4,391  3,085   21,035  13,874 
Total noninterest income$20,356 $38,200 $17,226 $37,293 $33,395  $113,075 $149,253 
Noninterest expense        
Salaries and employee benefits$71,841 $69,458 $70,637 $69,832 $67,372  $281,768 $261,654 
Data processing 3,971  3,907  3,684  3,633  3,521   15,195  14,900 
Net occupancy and equipment 11,653  11,548  11,865  11,405  11,122   46,471  44,819 
Other real estate owned 306  (120) 51  30  (59)  267  (453)
Professional fees 2,854  3,338  4,012  3,467  2,856   13,671  11,872 
Advertising and public relations 3,084  3,474  3,482  4,686  3,631   14,726  14,325 
Intangible amortization 1,274  1,311  1,369  1,426  1,195   5,380  5,122 
Communications 2,026  2,006  2,226  1,980  2,028   8,238  7,958 
Merger and conversion related expenses —  —  —  —  1,100   —  1,787 
Restructuring charges —  —  —  —  —   —  732 
Other 14,871  13,447  12,839  12,749  8,633   53,906  32,656 
Total noninterest expense$111,880 $108,369 $110,165 $109,208 $101,399  $439,622 $395,372 
                       

Mortgage Banking Income

(Dollars in thousands)Three Months Ended Twelve Months Ended
 Dec 31,
2023		Sep 30,
2023		Jun 30,
2023		Mar 31,
2023		Dec 31,
2022		 Dec 31,
2023		Dec 31,
2022
Gain on sales of loans, net$1,860 $3,297 $4,646 $4,770 $1,003  $14,573 $15,803 
Fees, net 2,010  2,376  2,859  1,806  1,849   9,051  10,371 
Mortgage servicing income, net 2,722  1,860  2,266  1,941  2,318   8,789  9,620 
Total mortgage banking income$6,592 $7,533 $9,771 $8,517 $5,170  $32,413 $35,794 
                       

Balance Sheet

(Dollars in thousands)As of
 Dec 31, 2023Sep 30, 2023Jun 30, 2023Mar 31, 2023Dec 31, 2022
Assets     
Cash and cash equivalents$801,351 $741,156 $946,899 $847,697 $575,992 
Securities held to maturity, at amortized cost 1,221,464  1,245,595  1,273,044  1,300,240  1,324,040 
Securities available for sale, at fair value 923,279  909,108  950,930  1,507,907  1,533,942 
Loans held for sale, at fair value 179,756  241,613  249,615  159,318  110,105 
Loans held for investment 12,351,230  12,168,023  11,930,516  11,766,425  11,578,304 
Allowance for credit losses on loans (198,578) (197,773) (194,391) (195,292) (192,090)
Loans, net 12,152,652  11,970,250  11,736,125  11,571,133  11,386,214 
Premises and equipment, net 283,195  284,368  285,952  287,006  283,595 
Other real estate owned 9,622  9,258  5,120  4,818  1,763 
Goodwill and other intangibles 1,010,460  1,011,735  1,013,046  1,014,415  1,015,884 
Bank-owned life insurance 382,584  379,945  377,649  375,572  373,808 
Mortgage servicing rights 91,688  90,241  87,432  85,039  84,448 
Other assets 304,484  298,352  298,530  320,938  298,385 
Total assets$17,360,535 $17,181,621 $17,224,342 $17,474,083 $16,988,176 
      
Liabilities and Shareholders’ Equity     
Liabilities     
Deposits:     
Noninterest-bearing$3,583,675 $3,734,197 $3,878,953 $4,244,877 $4,558,756 
Interest-bearing 10,493,110  10,422,913  10,216,408  9,667,142  8,928,210 
Total deposits 14,076,785  14,157,110  14,095,361  13,912,019  13,486,966 
Short-term borrowings 307,577  107,662  257,305  732,057  712,232 
Long-term debt 429,400  427,399  429,630  431,111  428,133 
Other liabilities 249,390  256,127  233,418  211,596  224,829 
Total liabilities 15,063,152  14,948,298  15,015,714  15,286,783  14,852,160 
      
Shareholders’ equity:     
Common stock 296,483  296,483  296,483  296,483  296,483 
Treasury stock (105,249) (105,300) (105,589) (107,559) (111,577)
Additional paid-in capital 1,308,281  1,304,891  1,301,883  1,299,458  1,302,422 
Retained earnings 952,124  936,573  907,312  891,242  857,725 
Accumulated other comprehensive loss (154,256) (199,324) (191,461) (192,324) (209,037)
Total shareholders’ equity 2,297,383  2,233,323  2,208,628  2,187,300  2,136,016 
Total liabilities and shareholders’ equity$17,360,535 $17,181,621 $17,224,342 $17,474,083 $16,988,176 
                

Net Interest Income and Net Interest Margin

(Dollars in thousands)Three Months Ended
 December 31, 2023September 30, 2023December 31, 2022
 Average
Balance		Interest
Income/
Expense		Yield/
Rate		Average
Balance		Interest
Income/
Expense		Yield/
Rate		Average
Balance		Interest
Income/
Expense		Yield/
Rate
Interest-earning assets:         
Loans held for investment$12,249,429 $190,857 6.18%$12,030,109 $183,521 6.06%$11,282,422 $147,519 5.19%
Loans held for sale 199,510  3,329 6.68% 227,982  3,751 6.58% 117,082  1,688 5.77%
Taxable securities 2,050,175  9,490 1.85% 2,097,285  9,459 1.80% 2,657,248  13,174 1.98%
Tax-exempt securities(1) 282,698  1,558 2.20% 285,588  1,566 2.19% 447,287  2,637 2.36%
Total securities 2,332,873  11,048 1.89% 2,382,873  11,025 1.85% 3,104,535  15,811 2.04%
Interest-bearing balances with banks 552,301  7,839 5.63% 729,049  10,128 5.51% 269,975  2,777 4.08%
Total interest-earning assets 15,334,113  213,073 5.52% 15,370,013  208,425 5.39% 14,774,014  167,795 4.51%
Cash and due from banks 180,609    180,708    201,369   
Intangible assets 1,011,130    1,012,460    967,005   
Other assets 669,988    672,232    635,452   
Total assets$17,195,840   $17,235,413   $16,577,840   
Interest-bearing liabilities:         
Interest-bearing demand(2)$6,721,053 $47,783 2.82%$6,520,145 $41,464 2.52%$6,018,679 $12,534 0.83%
Savings deposits 888,692  765 0.34% 942,619  793 0.33% 1,093,997  582 0.21%
Brokered deposits 632,704  8,594 5.39% 947,388  12,732 5.33% 93,764  1,047 4.43%
Time deposits 2,185,737  20,026 3.63% 2,002,505  15,917 3.15% 1,324,042  3,149 0.94%
Total interest-bearing deposits 10,428,186  77,168 2.94% 10,412,657  70,906 2.70% 8,530,482  17,312 0.81%
Borrowed funds 543,344  7,310 5.37% 545,105  7,388 5.40% 893,705  9,918 4.42%
Total interest-bearing liabilities 10,971,530  84,478 3.06% 10,957,762  78,294 2.84% 9,424,187  27,230 1.15%
Noninterest-bearing deposits 3,703,050    3,800,160    4,805,014   
Other liabilities 260,235    245,886    209,544   
Shareholders’ equity 2,261,025    2,231,605    2,139,095   
Total liabilities and shareholders’ equity$17,195,840   $17,235,413   $16,577,840   
Net interest income/ net interest margin $128,595 3.33% $130,131 3.36% $140,565 3.78%
Cost of funding  2.28%  2.11%  0.76%
Cost of total deposits  2.17%  1.98%  0.52%
             

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

Net Interest Income and Net Interest Margin, continued

(Dollars in thousands)Twelve Months Ended
 December 31, 2023December 31, 2022
 Average
Balance		Interest
Income/
Expense		Yield/
Rate		Average
Balance		Interest
Income/
Expense		Yield/
Rate
Interest-earning assets:      
Loans held for investment$11,963,141 $713,897 5.97%$10,677,995 $476,746 4.46%
Loans held for sale 181,253  11,807 6.51% 203,981  9,212 4.52%
Taxable securities(1) 2,313,874  44,619 1.93% 2,654,621  44,750 1.69%
Tax-exempt securities 332,749  7,634 2.29% 446,895  10,655 2.38%
Total securities 2,646,623  52,253 1.97% 3,101,516  55,405 1.79%
Interest-bearing balances with banks 568,155  30,375 5.35% 846,768  8,853 1.05%
Total interest-earning assets 15,359,172  808,332 5.26% 14,830,260  550,216 3.71%
Cash and due from banks 187,127    201,419   
Intangible assets 1,012,239    967,018   
Other assets 673,345    639,155   
Total assets$17,231,883   $16,637,852   
Interest-bearing liabilities:      
Interest-bearing demand(2)$6,357,753 $138,730 2.18%$6,420,905 $25,840 0.40%
Savings deposits 971,522  3,197 0.33% 1,116,013  1,023 0.09%
Brokered deposits 697,699  36,039 5.17% 23,634  1,047 4.43%
Time deposits 1,874,224  54,365 2.90% 1,310,398  7,298 0.56%
Total interest-bearing deposits 9,901,198  232,331 2.35% 8,870,950  35,208 0.40%
Borrowed funds 890,765  45,661 5.13% 624,887  25,304 4.05%
Total interest-bearing liabilities 10,791,963  277,992 2.58% 9,495,837  60,512 0.64%
Noninterest-bearing deposits 3,979,951    4,760,432   
Other liabilities 235,463    196,980   
Shareholders’ equity 2,224,506    2,184,603   
Total liabilities and shareholders’ equity$17,231,883   $16,637,852   
Net interest income/ net interest margin $530,340 3.45% $489,704 3.30%
Cost of funding  1.88%  0.42%
Cost of total deposits  1.67%  0.26%
         

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

Supplemental Margin Information

(Dollars in thousands)Three Months Ended Twelve Months Ended
 Dec 31, 2023Sep 30, 2023Dec 31, 2022 Dec 31, 2023Dec 31, 2022
Earning asset mix:      
Loans held for investment 79.88% 78.27% 76.36%  77.89% 72.00%
Loans held for sale 1.30  1.48  0.79   1.18  1.38 
Securities 15.21  15.50  21.01   17.23  20.91 
Interest-bearing balances with banks 3.61  4.75  1.84   3.70  5.71 
Total 100.00% 100.00% 100.00%  100.00% 100.00%
       
Funding sources mix:      
Noninterest-bearing demand 25.23% 25.75% 33.77%  26.94% 33.39%
Interest-bearing demand 45.80  44.18  42.30   43.04  45.04 
Savings 6.06  6.39  7.69   6.58  7.83 
Brokered deposits 4.31  6.42  0.66   4.72  0.17 
Time deposits 14.89  13.57  9.31   12.69  9.19 
Borrowed funds 3.71  3.69  6.27   6.03  4.38 
Total 100.00% 100.00% 100.00%  100.00% 100.00%
       
Net interest income collected on problem loans$283 $(820)$161  $219 $2,949 
Total accretion on purchased loans 1,117  1,290  625   4,166  5,198 
Total impact on net interest income$1,400 $470 $786  $4,385 $8,147 
Impact on net interest margin 0.04% 0.01% 0.02%  0.03% 0.05%
Impact on loan yield 0.05% 0.02% 0.03%  0.04% 0.08%
                 

Loan Portfolio

(Dollars in thousands)As of
 Dec 31, 2023Sep 30, 2023Jun 30, 2023Mar 31, 2023Dec 31, 2022
Loan Portfolio:     
Commercial, financial, agricultural$1,871,821 $1,819,891 $1,729,070 $1,740,778 $1,673,883 
Lease financing 116,020  120,724  122,370  121,146  115,013 
Real estate - construction 1,333,397  1,407,364  1,369,019  1,424,352  1,330,337 
Real estate - 1-4 family mortgages 3,439,919  3,398,876  3,348,654  3,278,980  3,216,263 
Real estate - commercial mortgages 5,486,550  5,313,166  5,252,479  5,085,813  5,118,063 
Installment loans to individuals 103,523  108,002  108,924  115,356  124,745 
Total loans$12,351,230 $12,168,023 $11,930,516 $11,766,425 $11,578,304 
                

Credit Quality and Allowance for Credit Losses on Loans

(Dollars in thousands)As of
 Dec 31, 2023Sep 30, 2023Jun 30, 2023Mar 31, 2023Dec 31, 2022
Nonperforming Assets:     
Nonaccruing loans$68,816 $69,541 $55,439 $56,626 $56,545 
Loans 90 days or more past due 554  532  36,321  18,664  331 
Total nonperforming loans 69,370  70,073  91,760  75,290  56,876 
Other real estate owned 9,622  9,258  5,120  4,818  1,763 
Total nonperforming assets$78,992 $79,331 $96,880 $80,108 $58,639 
      
Criticized Loans     
Classified loans$166,893 $186,052 $219,674 $222,701 $200,249 
Special Mention loans 99,699  89,858  56,616  64,832  86,172 
Criticized loans(1)$266,592 $275,910 $276,290 $287,533 $286,421 
      
Allowance for credit losses on loans$198,578 $197,773 $194,391 $195,292 $192,090 
Net loan charge-offs$1,713 $1,933 $3,901 $4,732 $2,566 
Annualized net loan charge-offs / average loans 0.06% 0.06% 0.13% 0.16% 0.09%
Nonperforming loans / total loans 0.56  0.58  0.77  0.64  0.49 
Nonperforming assets / total assets 0.46  0.46  0.56  0.46  0.35 
Allowance for credit losses on loans / total loans 1.61  1.63  1.63  1.66  1.66 
Allowance for credit losses on loans / nonperforming loans 286.26  282.24  211.85  259.39  337.73 
Criticized loans / total loans 2.16  2.27  2.32  2.44  2.47 
                

(1) Criticized loans include loans in risk rating classifications of classified and special mention.

CONFERENCE CALL INFORMATION:
A live audio webcast of a conference call with analysts will be available beginning at 10:00 AM Eastern Time (9:00 AM Central Time) on Wednesday, January 24, 2024.

The webcast is accessible through Renasant’s investor relations website at www.renasant.com or https://event.choruscall.com/mediaframe/webcast.html?webcastid=1DnpBQmV. To access the conference via telephone, dial 1-877-513-1143 in the United States and request the Renasant Corporation 2023 Fourth Quarter Earnings Webcast and Conference Call. International participants should dial 1-412-902-4145 to access the conference call.

The webcast will be archived on www.renasant.com after the call and will remain accessible for one year. A replay can be accessed via telephone by dialing 1-877-344-7529 in the United States and entering conference number 1831497 or by dialing 1-412-317-0088 internationally and entering the same conference number. Telephone replay access is available until February 7, 2024.

ABOUT RENASANT CORPORATION:

Renasant Corporation is the parent of Renasant Bank, a 119-year-old financial services institution. Renasant has assets of approximately $17.4 billion and operates 195 banking, lending, mortgage, wealth management and insurance offices throughout the Southeast as well as offering factoring and asset-based lending on a nationwide basis.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS:

This press release may contain, or incorporate by reference, statements about Renasant Corporation that constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Statements preceded by, followed by or that otherwise include the words “believes,” “expects,” “projects,” “anticipates,” “intends,” “estimates,” “plans,” “potential,” “focus,” “possible,” “may increase,” “may fluctuate,” “will likely result,” and similar expressions, or future or conditional verbs such as “will,” “should,” “would” and “could,” are generally forward-looking in nature and not historical facts. Forward-looking statements include information about the Company’s future financial performance, business strategy, projected plans and objectives and are based on the current beliefs and expectations of management. The Company’s management believes these forward-looking statements are reasonable, but they are all inherently subject to significant business, economic and competitive risks and uncertainties, many of which are beyond the Company’s control. In addition, these forward-looking statements are subject to assumptions with respect to future business strategies and decisions that are subject to change. Actual results may differ from those indicated or implied in the forward-looking statements, and such differences may be material. Prospective investors are cautioned that any forward-looking statements are not guarantees of future performance and involve risks and uncertainties and, accordingly, investors should not place undue reliance on these forward-looking statements, which speak only as of the date they are made.

Important factors currently known to management that could cause our actual results to differ materially from those in forward-looking statements include the following: (i) the Company’s ability to efficiently integrate acquisitions into its operations, retain the customers of these businesses, grow the acquired operations and realize the cost savings expected from an acquisition to the extent and in the timeframe anticipated by management; (ii) the effect of economic conditions and interest rates on a national, regional or international basis; (iii) timing and success of the implementation of changes in operations to achieve enhanced earnings or effect cost savings; (iv) competitive pressures in the consumer finance, commercial finance, insurance, financial services, asset management, retail banking, factoring and mortgage lending and auto lending industries; (v) the financial resources of, and products available from, competitors; (vi) changes in laws and regulations as well as changes in accounting standards; (vii) changes in policy by regulatory agencies; (viii) changes in the securities and foreign exchange markets; (ix) the Company’s potential growth, including its entrance or expansion into new markets, and the need for sufficient capital to support that growth; (x) changes in the quality or composition of the Company’s loan or investment portfolios, including adverse developments in borrower industries or in repayment ability of individual borrowers or issuers of investment securities, or the impact of interest rates on the value of our investment securities portfolio; (xi) an insufficient allowance for credit losses as a result of inaccurate assumptions; (xii) changes in the sources and costs of the capital we use to make loans and otherwise fund our operations, due to deposit outflows, changes in the mix of deposits and the cost and availability of borrowings; (xiii) general economic, market or business conditions, including the impact of inflation; (xiv) changes in demand for loan products and financial services; (xv) concentration of deposit and credit exposure; (xvi) changes or the lack of changes in interest rates, yield curves and interest rate spread relationships; (xvii) increased cybersecurity risk, including potential network breaches, business disruptions or financial losses; (xviii) civil unrest, natural disasters, epidemics and other catastrophic events in the Company’s geographic area; (xix) the impact, extent and timing of technological changes; and (xx) other circumstances, many of which are beyond management’s control.

Management believes that the assumptions underlying the Company’s forward-looking statements are reasonable, but any of the assumptions could prove to be inaccurate. Investors are urged to carefully consider the risks described in the Company’s filings with the Securities and Exchange Commission (the “SEC”) from time to time, including its most recent Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q, which are available at www.renasant.com and the SEC’s website at www.sec.gov.

The Company undertakes no obligation, and specifically disclaims any obligation, to update or revise forward-looking statements, whether as a result of new information or to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results over time, except as required by federal securities laws.

NON-GAAP FINANCIAL MEASURES:

In addition to results presented in accordance with generally accepted accounting principles in the United States of America (“GAAP”), this press release and the presentation slides furnished to the SEC on the same Form 8-K as this release contain non-GAAP financial measures, including, without limitation, (i) adjusted loan yield, (ii) adjusted net interest income and margin, (iii) pre-provision net revenue (including on an as-adjusted basis), (iv) adjusted net income, (v) adjusted diluted earnings per share, (vi) tangible book value per share, (vii) the tangible common equity ratio, (viii) certain performance ratios (namely, the ratio of pre-provision net revenue to average assets, the adjusted return on average assets and on average equity, and the return on average tangible assets and on average tangible common equity (including each of the foregoing on an as-adjusted basis)), and (ix) the adjusted efficiency ratio.

These non-GAAP financial measures adjust GAAP financial measures to exclude intangible assets, including related amortization, and/or certain gains or charges (such as, for the fourth quarter of 2023, the gain on extinguishment of debt and the gain on the sale of mortgage servicing rights), with respect to which the Company is unable to accurately predict when these charges will be incurred or, when incurred, the amount thereof. Management uses these non-GAAP financial measures when evaluating capital utilization and adequacy. In addition, the Company believes that these non-GAAP financial measures facilitate the making of period-to-period comparisons and are meaningful indicators of its operating performance, particularly because these measures are widely used by industry analysts for companies with merger and acquisition activities. Also, because intangible assets such as goodwill and the core deposit intangible can vary extensively from company to company and, as to intangible assets, are excluded from the calculation of a financial institution’s regulatory capital, the Company believes that the presentation of this non-GAAP financial information allows readers to more easily compare the Company’s results to information provided in other regulatory reports and the results of other companies. Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures are included in the tables below under the caption “Non-GAAP Reconciliations”.

None of the non-GAAP financial information that the Company has included in this release or the accompanying presentation slides are intended to be considered in isolation or as a substitute for any measure prepared in accordance with GAAP. Investors should note that, because there are no standardized definitions for the calculations as well as the results, the Company’s calculations may not be comparable to similarly titled measures presented by other companies. Also, there may be limits in the usefulness of these measures to investors. As a result, the Company encourages readers to consider its consolidated financial statements in their entirety and not to rely on any single financial measure.

Non-GAAP Reconciliations

(Dollars in thousands, except per share data)Three Months Ended Twelve Months Ended
 Dec 31,
2023		Sep 30,
2023		Jun 30,
2023		Mar 31,
2023		Dec 31,
2022		 Dec 31,
2023		Dec 31,
2022
Adjusted Pre-Provision Net Revenue (“PPNR”)      
Net income (GAAP)$28,124 $41,833 $28,643 $46,078 $46,276  $144,678 $166,068 
Income taxes 3,787  10,766  6,634  11,322  12,885   32,509  45,240 
Provision for credit losses (including unfunded commitments) 2,518  4,615  2,000  6,460  10,671   15,593  23,871 
Pre-provision net revenue (non-GAAP)$34,429 $57,214 $37,277 $63,860 $69,832  $192,780 $235,179 
Merger and conversion expense —  —  —  —  1,100   —  1,787 
Gain on extinguishment of debt (620) —  —  —  —   (620) — 
Gain on sale of MSR (547) —  —  —  —   (547) (2,960)
Restructuring charges —  —  —  —  —   —  732 
Voluntary reimbursement of certain re-presentment NSF fees —  —  —  —  1,255   —  1,255 
Losses on security sales (including impairments) 19,352  —  22,438  —  —   41,790  — 
Adjusted pre-provision net revenue (non-GAAP)$52,614 $57,214 $59,715 $63,860 $72,187  $233,403 $235,993 
         
Adjusted Net Income and Adjusted Tangible Net Income      
Net income (GAAP)$28,124 $41,833 $28,643 $46,078 $46,276  $144,678 $166,068 
Amortization of intangibles 1,274  1,311  1,369  1,426  1,195   5,380  5,122 
Tax effect of adjustments noted above(1) (240) (269) (266) (299) (260)  (1,012) (1,119)
Tangible net income (non-GAAP)$29,158 $42,875 $29,746 $47,205 $47,211  $149,046 $170,071 
         
Net income (GAAP)$28,124 $41,833 $28,643 $46,078 $46,276  $144,678 $166,068 
Merger and conversion expense —  —  —  —  1,100   —  1,787 
Gain on extinguishment of debt (620) —  —  —  —   (620) — 
Gain on sale of MSR (547) —  —  —  —   (547) (2,960)
Restructuring charges —  —  —  —  —   —  732 
Initial provision for acquisitions —  —  —  —  2,820   —  2,820 
Voluntary reimbursement of certain re-presentment NSF fees —  —  —  —  1,255   —  1,255 
Losses on security sales (including impairments) 19,352  —  22,438  —  —   41,790  — 
Tax effect of adjustments noted above(1) (3,422) —  (4,353) —  (1,127)  (7,644) (816)
Adjusted net income (non-GAAP)$42,887 $41,833 $46,728 $46,078 $50,324  $177,657 $168,886 
Amortization of intangibles 1,274  1,311  1,369  1,426  1,195   5,380  5,122 
Tax effect of adjustments noted above(1) (240) (269) (266) (299) (260)  (1,012) (1,119)
Adjusted tangible net income (non-GAAP)$43,921 $42,875 $47,831 $47,205 $51,259  $182,025 $172,889 
Tangible Assets and Tangible Shareholders’ Equity      
Average shareholders’ equity (GAAP)$2,261,025 $2,231,605 $2,217,708 $2,186,794 $2,139,095  $2,224,506 $2,184,603 
Average intangible assets 1,011,130  1,012,460  1,013,811  1,011,557  967,005   1,012,239  967,018 
Average tangible shareholders’ equity (non-GAAP)$1,249,895 $1,219,145 $1,203,897 $1,175,237 $1,172,090  $1,212,267 $1,217,585 
         
Average assets (GAAP)$17,195,840 $17,235,413 $17,337,924 $17,157,898 $16,577,840  $17,231,883 $16,637,852 
Average intangible assets 1,011,130  1,012,460  1,013,811  1,011,557  967,005   1,012,239  967,018 
Average tangible assets (non-GAAP)$16,184,710 $16,222,953 $16,324,113 $16,146,341 $15,610,835  $16,219,644 $15,670,834 
         
Shareholders’ equity (GAAP)$2,297,383 $2,233,323 $2,208,628 $2,187,300 $2,136,016  $2,297,383 $2,136,016 
Intangible assets 1,010,460  1,011,735  1,013,046  1,014,415  1,015,884   1,010,460  1,015,884 
Tangible shareholders’ equity (non-GAAP)$1,286,923 $1,221,588 $1,195,582 $1,172,885 $1,120,132  $1,286,923 $1,120,132 
         
Total assets (GAAP)$17,360,535 $17,181,621 $17,224,342 $17,474,083 $16,988,176  $17,360,535 $16,988,176 
Intangible assets 1,010,460  1,011,735  1,013,046  1,014,415  1,015,884   1,010,460  1,015,884 
Total tangible assets (non-GAAP)$16,350,075 $16,169,886 $16,211,296 $16,459,668 $15,972,292  $16,350,075 $15,972,292 
         
Adjusted Performance Ratios        
Return on average assets (GAAP) 0.65% 0.96% 0.66% 1.09% 1.11%  0.84% 1.00%
Adjusted return on average assets (non-GAAP) 0.99  0.96  1.08  1.09  1.20   1.03  1.02 
Return on average tangible assets (non-GAAP) 0.71  1.05  0.73  1.19  1.20   0.92  1.09 
Pre-provision net revenue to average assets (non-GAAP) 0.79  1.32  0.86  1.51  1.67   1.12  1.41 
Adjusted pre-provision net revenue to average assets (non-GAAP) 1.21  1.32  1.38  1.51  1.73   1.35  1.42 
Adjusted return on average tangible assets (non-GAAP) 1.08  1.05  1.18  1.19  1.30   1.12  1.10 
Return on average equity (GAAP) 4.93  7.44  5.18  8.55  8.58   6.50  7.60 
Adjusted return on average equity (non-GAAP) 7.53  7.44  8.45  8.55  9.33   7.99  7.73 
Return on average tangible equity (non-GAAP) 9.26  13.95  9.91  16.29  15.98   12.29  13.97 
Adjusted return on average tangible equity (non-GAAP) 13.94  13.95  15.94  16.29  17.35   15.02  14.20 
         
Adjusted Diluted Earnings Per Share      
Average diluted shares outstanding 56,611,217  56,523,887  56,395,653  56,270,219  56,335,446   56,448,163  56,214,230 
         
Diluted earnings per share (GAAP)$0.50 $0.74 $0.51 $0.82 $0.82  $2.56 $2.95 
Adjusted diluted earnings per share (non-GAAP)$0.76 $0.74 $0.83 $0.82 $0.89  $3.15 $3.00 
         
Tangible Book Value Per Share        
Shares outstanding 56,142,207  56,140,713  56,132,478  56,073,658  55,953,104   56,142,207  55,953,104 
         
Book value per share (GAAP)$40.92 $39.78 $39.35 $39.01 $38.18  $40.92 $38.18 
Tangible book value per share (non-GAAP)$22.92 $21.76 $21.30 $20.92 $20.02  $22.92 $20.02 
         
Tangible Common Equity Ratio        
Shareholders’ equity to assets (GAAP) 13.23% 13.00% 12.82% 12.52% 12.57%  13.23% 12.57%
Tangible common equity ratio (non-GAAP) 7.87% 7.55% 7.37% 7.13% 7.01%  7.87% 7.01%
Adjusted Efficiency Ratio        
Net interest income (FTE) (GAAP)$128,595 $130,131 $133,085 $138,529 $140,565  $530,340 $489,704 
         
Total noninterest income (GAAP)$20,356 $38,200 $17,226 $37,293 $33,395  $113,075 $149,253 
Gain on sale of MSR 547  —  —  —  —   547  2,960 
Gain on extinguishment of debt 620  —  —  —  —   620  — 
Losses on security sales (including impairments) (19,352) —  (22,438) —  —   (41,790) — 
Total adjusted noninterest income (non-GAAP)$38,541 $38,200 $39,664 $37,293 $33,395  $153,698 $146,293 
         
Noninterest expense (GAAP)$111,880 $108,369 $110,165 $109,208 $101,399  $439,622 $395,372 
Amortization of intangibles 1,274  1,311  1,369  1,426  1,195   5,380  5,122 
Merger and conversion expense —  —  —  —  1,100   —  1,787 
Restructuring charges —  —  —  —  —   —  732 
Voluntary reimbursement of certain re-presentment NSF fees —  —  —  —  1,255   —  1,255 
Total adjusted noninterest expense (non-GAAP)$110,606 $107,058 $108,796 $107,782 $97,849  $434,242 $386,476 
         
Efficiency ratio (GAAP) 75.11% 64.38% 73.29% 62.11% 58.29%  68.33% 61.88%
Adjusted efficiency ratio (non-GAAP) 66.18% 63.60% 62.98% 61.30% 56.25%  63.48% 60.77%
         
Adjusted Net Interest Income and Adjusted Net Interest Margin      
Net interest income (FTE) (GAAP)$128,595 $130,131 $133,085 $138,529 $140,565  $530,340 $489,704 
Net interest income collected on problem loans 283  (820) 364  392  161   219  2,949 
Accretion recognized on purchased loans 1,117  1,290  874  885  625   4,166  5,198 
Adjustments to net interest income$1,400 $470 $1,238 $1,277 $786  $4,385 $8,147 
Adjusted net interest income (FTE) (non-GAAP)$127,195 $129,661 $131,847 $137,252 $139,779  $525,955 $481,557 
         
Net interest margin (GAAP) 3.33% 3.36% 3.45% 3.66% 3.78%  3.45% 3.30%
Adjusted net interest margin (non-GAAP) 3.29% 3.35% 3.43% 3.63% 3.76%  3.42% 3.25%
         
Adjusted Loan Yield        
Loan interest income (FTE) (GAAP)$190,857 $183,521 $175,549 $163,970 $147,519  $713,897 $476,746 
Net interest income collected on problem loans 283  (820) 364  392  161   219  2,949 
Accretion recognized on purchased loans 1,117  1,290  874  885  625   4,166  5,198 
Adjusted loan interest income (FTE) (non-GAAP)$189,457 $183,051 $174,311 $162,693 $146,733  $709,512 $468,599 
         
Loan yield (GAAP) 6.18% 6.06% 5.93% 5.68% 5.19%  5.97% 4.46%
Adjusted loan yield (non-GAAP) 6.14% 6.04% 5.89% 5.64% 5.16%  5.93% 4.39%
                       

(1) Tax effect is calculated based on the respective periods’ year-to-date effective tax rate excluding the impact of discrete items.

   
Contacts:For Media:For Financials:
 John S. OxfordJames C. Mabry IV
 Senior Vice PresidentExecutive Vice President
 Chief Marketing OfficerChief Financial Officer
 (662) 680-1219(662) 680-1281
   

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Source: Renasant Corporation

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