TUPELO • BancorpSouth reported net income of $53.1 million, or 53 cents per share, for the second quarter of 2019, compared to $54 million, or 55 cents per share, for the same period a year earlier.

The company’s revenue for the quarter was $226.35 million, an increase of 5.5% but $9.56 million below some analysts’ projections.

Highlights for the second quarter of 2019 included:

• The completion of the acquisitions of Casey Bancorp Inc. and Merchants Trust Inc., effective April 1, 2019; recorded merger-related expenses of $3.1 million for the second quarter.

• Earnings were impacted by a negative pre-tax mortgage servicing rights valuation adjustment of $8.8 million.

• Record net operating income – excluding MSR – of $62.0 million, or 61 cents per share, which represents an increase of 8.9 percent on a per share basis, compared with both the second quarter of 2018 and the first quarter of 2019.

• Generated net organic loan growth for the quarter totaling approximately $170 million, or 5.2 percent on an annualized basis.

• Net interest margin increased to 3.79 percent, compared with 3.71 percent a year earlier.

“We are pleased to report record net operating income – excluding MSR – for the second quarter of 2019,” said Bancorpsouth Chairman and CEO Dan Rollins. “”While the negative MSR asset valuation adjustment adversely impacted our GAAP earnings, strong organic balance sheet results contributed to record net operating income.”

Net interest revenue was $160 million for the second quarter of 2019, an increase of 12.6 percent from $142.1 million for the second quarter of 2018 and an increase of 4.9 percent from $152.6 million for the first quarter of 2019.

Loans and leases, net of unearned income, increased $587.5 million during the second quarter of 2019. This includes loans totaling $415.0 million acquired as a part of the Grand Bank and Merchants Bank mergers on April 1, 2019. Excluding acquired loans, total loans increased approximately $170.0 million during the second quarter or, 5.2% on an annualized basis.

Deposits increased $444 million during the second quarter of 2019. This includes deposits totaling $529 million acquired as a part of the Grand Bank and Merchants Bank mergers. Excluding acquired deposits, total deposits declined approximately $85 million during the quarter. Deposits have increased $1.07 billion since Dec. 31, 2018. Excluding acquired deposits, total deposits increased approximately $540 million during the first six months of the year, or, 7.7% on an annualized basis.

Noninterest revenue was $66.3 million for the second quarter of 2019, compared with $72.5 million for the second quarter of 2018 and $64.2 million for the first quarter of 2019.

Excluding the MSR valuation adjustment, mortgage banking revenue was $9.2 million for the second quarter, compared with $7.1 million a year earlier. Mortgage origination volume for the period was $495.5 million, compared with $523.7 million for the second quarter of 2018 and $291.7 million for the first quarter of 2019. Of the total mortgage origination volume for the second quarter of 2019, $153.7 million was portfolio loans, compared with $209.3 million for the second quarter of 2018 and $54.1 million for the first quarter of 2019.

Credit card, debit card, and merchant fee revenue was $10.2 million for the second quarter of 2019, compared with $10.5 million for the second quarter a year ago. Deposit service charge revenue was $11.1 million, compared with $10.8 million for both the second quarter of last year and the first quarter of this year. Wealth management revenue was $5.9 million, up from last year’s $5.7 million for the second quarter of 2018.

— Dennis Seid / Daily Journal