TUPELO — Regional bank Renasant Corp.’s profit rose 26 percent in 2013’s second quarter from the same three months of 2012, as it set aside less for bad loans and increased interest earnings.
Renasant said today it posted quarterly profit of $8.02 million, or 32 cents per share, up from $6.35 million or 25 cents per share in 2012’s second quarter.
Analysts polled by FactSet had estimated 32 cents per share, on average.
“Our second quarter results reflect our continued efforts to grow net income, which increased for the sixth consecutive quarter,” said chairman and CEO E. Robinson McGraw.
The bank said total loans increased to $2.85 billion, up 8 percent over a year ago. Renasant set aside $3 million for future bad loans, $1.7 million less than in 2012’s second quarter.
Renasant’s return on assets rose to 0.76 percent. That key measure of profitability has been steadily rising at Renasant, but the bank has trailed statewide and national averages. In 2013’s first quarter, Renasant had return on assets of 0.73 percent, compared to 0.84 percent for all banks based in Mississippi and 1.12 percent for all banks nationwide.
The amount that the company collected in interest from borrowers, net of what it paid out to savers, rose to $34 million. However, the net interest margin, a measure of that spread divided by all loans, drifted down to 3.88 percent. Low interest rates have caused that spread, which is the bread-and-butter of bank profits, to narrow.
Based in Tupelo, the $4.2 billion bank has offices in Mississippi, Tennessee, Alabama and Georgia. Renasant awaits regulatory approval to merge with First M&F Corp. of Kosciusko, Miss., after shareholders for both banks approved the $143 million stock purchase in June. The merger will create the fourth-largest bank in Mississippi, with $5.8 billion in assets.
“Our pending merger with First M&F Corp, which we anticipate completing during the third quarter of 2013, will only enhance our strong performance potential,” McGraw said.
Renasant spent $385,000 on merger expenses in the second quarter.
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