Renasant Corporation · NYSE:RNST
Renasant — Investor Presentation (May 2019)
44 slides from Renasant's investor presentation, May 6, 2019
Slide 1: Q2 2019 Investor Presentation
Q2 2019 Investor Presentation Financial Information – March 31, 2019
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains various “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 about Renasant Corporation (“Renasant,” “we,” “our,” or “us”) that are subject to risks and uncertainties. Congress passed the Private
Slide 3: Current Footprint
Current Footprint More than 190 banking, lending, wealth management and insurance offices Portfolio Loans* Northern Eastern 22% 39% Western 23% Central 16% Total Deposits* Northern 15% Eastern Western 36% 38% Central 11% * As of March 31, 2019. Portfolio Loans excludes loans held for sale. 3
Slide 4: Four Key Strategic Initiatives
Four Key Strategic Initiatives • Focus on highly-accretive acquisition opportunities Capitalize on • Leverage existing markets Opportunities • Seek new markets • New lines of business • Superior returns • Revenue growth / Expense control Enhance Profitability • Net interest margin expansion / mitiga
Slide 5: Renasant Footprint – June 2010
Renasant Footprint – June 2010 Financial Highlights Nashville TENNESSEE Assets $3.59 Billion Memphis Gross Loans* $2.28 Billion Deposits $2.69 Billion Huntsville Tupelo Atlanta Birmingham GEORGIA ALABAMA Jackson Montgomery MISSISSIPPI Source: SNL Financial 5 * Excludes loans held for sale 5
Slide 6: Market Expansion Since 2010
Market Expansion Since 2010 2018 Whole Bank Transaction: Brand Group Holdings, Inc. | Lawrenceville, GA | Assets: $2.3 billion Whole Bank Transaction: Metropolitan BancGroup, Inc. | Ridgeland, MS | Assets: $1.2 billion 2017 De novo expansion: Mobile, AL 2016 Whole Bank Transaction: KeyWorth Bank | A
Slide 7: Current Footprint
Current Footprint Over 190 banking, lending, wealth management and insurance offices Highlights1 Assets $12.86 Billion Gross Loans2 $9.09 Billion Deposits $10.27 Billion 1 As of March 31, 2019 2 Excludes loans held for sale 7
Slide 8: Merger of Renasant Corporation and Brand Group Holdings, Inc.
Merger of Renasant Corporation and Brand Group Holdings, Inc. Completed September 1, 2018 8
Slide 9: Atlanta – The Southeast's Most Attractive MSA
Atlanta – The Southeast’s Most Attractive MSA Brand’s Strategic Branch Footprint Atlanta MSA Highlights . 2nd largest MSA in the Southeast by population at ~6mm ‒ 9th largest in the U.S. Brand Branches (8) . Largest MSA in the Southeast by GDP at ~$300bn BrandExpress ‒ 8th largest in the U.S. Branch
Slide 10: Our Atlanta Franchise
Our Atlanta Franchise Atlanta MSA Deposit Market Share Pro Forma Atlanta MSA Branch Footprint (1) Deposits Market Rank Institution ($mm) Share Branches Pickens 1 Wells Fargo & Co. $21,417 19.9 % 173 2 Bank of America Corp. 17,869 16.6 129 Dawson 75 3 SunTrust Banks Inc. 14,200 13.2 152 Cherokee Hall
Slide 11: Our Combined Company
Our Combined Company 1 Current Footprint Financial Highlights Assets $12.86 billion Johnson City Knoxville 40 2 Nashville 40 Loans $9.09 billion TENNESSEE Deposits $10.27 billion Memphis 65 24 Huntsville 75 Branches 169 Tupelo 20 Loans/Deposits 88.5% Birmingham Atlanta Augusta 1 20 Auburn Macon Depo
Slide 12: Four Key Strategic Initiatives
Four Key Strategic Initiatives • Focus on highly-accretive acquisition opportunities Capitalize on • Leverage existing markets Opportunities • Seek new markets • New lines of business • Superior returns • Revenue growth / Expense control Enhance Profitability • Net interest margin expansion / mitiga
Slide 13: Total Assets
Total Assets • Reduced balance sheet to $12,000 manage assets below $10 billion at December 31, 2017 $10,000 • Deleverage strategy included: • Reduction of $479 million in investment securities $8,000 • Reduction of $99 million in mortgage loans held for sale $6,000 • Purchased investment securities
Slide 14: Diluted Earnings Per Share
Diluted Earnings Per Share* $3.50 $0.90 $3.00 $0.80 $.78 $.78 $.77 $3.00 $.75 $.70 $0.70 $.64 $2.50 $2.42 $.61 $.62 $2.31 $.59 $.59 $.59 $0.60 $2.10 $.54 $.55 $1.89 $2.00 $0.50 $1.50 $1.38 $0.40 $1.09 $0.30 $1.00 $0.20 $0.50 $0.10 $0.00 $0.00 2012 2013 2014 2015 2016 2017 2018 1Q16 3Q16 1Q17 3Q17 1Q
Slide 15: Enhanced Profitability
Enhanced Profitability Return on Assets* Return on Tangible Equity* 1.60% 20.00% 1.47% 1.45% 1.46%1.44% 18.32% 1.39% 17.66% 1.40% 18.00% 17.11% 17.41% 16.37% 16.23% 16.34% 16.10% 1.20% 16.00% 1.20% 1.15% 14.48% 1.10% 1.03% 14.00% 1.00% 12.17% 12.00% 0.80% 0.80% 10.00% 9.40% 0.66% 0.60% 8.00% 6.00% 0
Slide 16: Total Portfolio Loans
Total Portfolio Loans $10,000,000 • Loans not purchased increased $9,000,000 $176 million, or 11% annualized, $8,000,000 during 1Q19 $7,000,000 • Loan production for 1Q19 was $6,000,000 $374 million $5,000,000 • Company maintains strong $4,000,000 pipelines throughout all $3,000,000 markets which wi
Slide 17: Diversified Loan Portfolio
Diversified Loan Portfolio . At March 31, 2019, loans totaled $9.09 billion* 72% Not Purchased 28% Purchased Non Owner Occupied 25% Owner Occupied 18% C&I 14% 1-4 Family Consumer 2% 31% Const Land Dev 8% 2% * Excludes Loans held for sale 17
Slide 18: C&D and CRE Loan Concentration Levels
C&D and CRE Loan Concentration Levels Acquisition, Development & Construction (ADC) and Commercial Real Estate (CRE) ADC Loans as a Percentage of CRE Loans (Construction & Perm) as a Risk Based Capital* Percentage of Risk Based Capital* 100% 300% 91% 87% 82% 83% 81% 80% 80% 79% 250% 80% 76% 77% 75%
Slide 19: Focus on Core Funding
Focus on Core Funding $12,000,000 3.00% $10,000,000 2.50% $8,000,000 2.00% ) $6,000,000 1.50% $4,000,000 1.00% ($ in thousands $2,000,000 0.50% $- 0.00% 2013 2014 2015 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 Total Deposits Cost of Deposits Fed Funds $2,500,000 Non Interest B
Slide 20: Net Interest Income and Net Interest Expense
Net Interest Income and Net Interest Expense 6.00% 6.00% 5.00% 5.00% 4.00% 4.00% 3.00% 3.00% Margin Yield/Cost 2.00% 2.00% 1.00% 1.00% 0.00% 0.00% 2013 2014 2015 2016 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 Yield on Earning Assets Cost of Funds Margin ($ in thousands) 2013 2014 2015 2016 1Q17 2
Slide 21: Sources of Non Interest Income
Sources of Non Interest Income* ($ in thousands) • Diversified sources of noninterest income Non Interest Income* $45,000 • Opportunities for growing Non Interest Income $40,000 $35,000 Expansion of Trust Division Wealth Management $30,000 services into larger, metropolitan markets $25,000 Expans
Slide 22: Improved Efficiency
Improved Efficiency 80.00% • Continued focus on managing noninterest expenses and 75.00% improving efficiency • Provided resources for nine 70.00% de novo expansions since 2011 • Fluctuations in mortgage loan 65.00% expense driven by higher mortgage production 60.00% 55.00% 50.00% 45.00% 2013 2014 2
Slide 23: Four Key Strategic Initiatives
Four Key Strategic Initiatives • Focus on highly-accretive acquisition opportunities Capitalize on • Leverage existing markets Opportunities • Seek new markets • New lines of business • Superior returns • Revenue growth / Expense control Enhance Profitability • Net interest margin expansion / mitiga
Slide 24: Non Performing Assets Continue to Decline
Non Performing Assets Continue to Decline Both on a Linked Quarter and Y-O-Y Basis 2.50% . Not purchased NPAs are now below pre-credit cycle levels . 2.00% Loss-share agreements with FDIC were terminated in 4Q 2016 1.50% 1.00% Not Purchased Purchased Not Covered NPL’s $13.7M $13.3M 0.50% ORE $4.2M $
Slide 25: Proactive in Providing Reserves for Problem Credit Resolution
Proactive in Providing Reserves for Problem Credit Resolution $6,000 450% • Net charge-offs: 400% $5,000 • 3 bps in 1Q19 350% • Provision for loan losses: $4,000 300% • $1.5 million in 1Q19 250% $3,000 ($ in thousands) 200% $2,000 150% 100% $1,000 50% $- 0% ($)Provision for Loan Losses ($)Net Charge
Slide 26: Strong Credit Quality Metrics
Strong Credit Quality Metrics NPLs and Early Stage Delinquencies (30-89 Days Past Due Loans)* $25,000 $20,000 NPLs 30-89 $15,000 Days $10,000 $5,000 $0 2013 2014 2015 2016 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 ($ in thousands) *Amounts exclude loans and assets purchased in connection with rec
Slide 27: Four Key Strategic Initiatives
Four Key Strategic Initiatives • Focus on highly-accretive acquisition opportunities Capitalize on • Leverage existing markets Opportunities • Seek new markets • New lines of business • Superior returns • Revenue growth / Expense control Enhance Profitability • Net interest margin expansion / mitiga
Slide 28: Strong Capital Position
Strong Capital Position Tangible Common Equity Ratio* • Increased quarterly dividend five times since 2Q16, 10.50% including twice in 2018 and once in 2019. 9.50% • Regulatory capital ratios are well above the minimum for well-capitalized classification 8.50% • Capital level positions the Company fo
Slide 29: Consistent and Strong Dividend
Consistent and Strong Dividend Dividends Per Share – Annually Dividends Per Share – Quarterly $0.90 $0.25 $0.80 $0.70 $0.20 $0.60 $0.15 $0.50 $0.40 $0.10 $0.30 $0.20 $0.05 $0.10 $0.00 $0.00 29
Slide 30: Poised for Growth with Added Shareholder Value
Poised for Growth with Added Shareholder Value . $12.86B franchise well positioned in attractive markets in the Southeast . Merger with Brand Group Holdings, Inc. added $2.3B in assets, $1.7B in deposits and $1.6B in loans on the acquisition date . Strategic focus on expanding footprint • Acquisitio
Slide 31: Appendix
Appendix 31
Slide 32: Alabama – Central Region
Alabama – Central Region . Mazda and Toyota announced $1.6 billion investment creating up to 4,000 jobs by 2021 Alabama Deposit Market Share . Ranked #6 on the Area Development Top States for Doing Business 2016 Deposits Market Rank Institution ($mm) Share Branches 1 Regions Financial Corp. $21,902
Slide 33: Florida – Central Region
Florida – Central Region . Entered the Florida market through the acquisition of HBOS. Florida Deposit Market Share Moved into FL with 6 full-services branches along I-75 Deposits Market . Opened Mortgage Production Offices in Destin and Jacksonville in 1Q Rank Institution ($mm) Share Branches 1 B
Slide 34: Georgia – Eastern Region
Georgia – Eastern Region . Entered the North GA market through two FDIC loss share transactions Georgia Deposit Market Share 12 full-service locations Deposits Market Rank Institution ($mm) Share Branches Expanded services include mortgage and wealth management personnel 1 SunTrust Banks Inc. $5
Slide 35: Mississippi – Western Region
Mississippi – Western Region . Increased presence in Mississippi with the recent acquisition of Metropolitan BancGroup, Inc., which Mississippi Deposit Market Share closed 7/1/17 Deposits Market Rank Institution ($mm) Share Branches Added 4-full service branches 1 Trustmark Corp. $7,601 14.1 % 122
Slide 36: Tennessee – Northern Region
Tennessee – Northern Region . Our Tennessee Operations Tennessee Deposit Market Share The Knoxville/Maryville MSA location opened in late Q2 ‘12 Deposits Market East Tennessee operations currently have 4 full-service branches, $304 million in Rank Institution ($mm) Share Branches loans and $133
Slide 37: Reconciliation of Non-GAAP Disclosures: Tangible Common Equity
Reconciliation of Non-GAAP Disclosures Tangible Common Equity $ in thousands 2013 2014 2015 2016 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 Actual shareholders' equity (GAAP) $ 665,652 $ 711,651 $ 1,036,818 $ 1,232,883 $ 1,251,065 $ 1,271,786 $ 1,511,826 $ 1,514,983 $ 1,532,765 $ 1,558,668 $ 2,010
Slide 38: Reconciliation of Non-GAAP Disclosures: Efficiency Ratio
Reconciliation of Non-GAAP Disclosures Efficiency Ratio $ in thousands 2013 2014 2015 2016 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 Net interest income (FTE) $ 162,957 $ 209,319 $ 248,613 $ 308,002 $ 75,907 $ 81,453 $ 91,935 $ 96,448 $ 90,807 $ 93,806 $ 100,880 $ 116,933 $ 114,631 Total noninter
Slide 39: Reconciliation of Non-GAAP Disclosures: Efficiency Ratio (Excluding Mortgage)
Reconciliation of Non-GAAP Disclosures Efficiency Ratio (Excluding Mortgage) $ in thousands 2013 2014 2015 2016 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 Net interest income (FTE) $ 161,148 $ 207,446 $ 240,304 $ 299,868 $ 75,057 $ 80,177 $ 90,364 $ 95,174 $ 90,001 $ 92,701 $ 99,880 $ 116,118 $ 11
Slide 40: Reconciliation of Non-GAAP Disclosures: Non Interest Income
Reconciliation of Non-GAAP Disclosures Non Interest Income $ in thousands 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 Actual non interest income (GAAP) $ 21,869 $ 22,880 $ 32,079 $ 31,442 $ 33,302 $ 35,586 $ 38,272 $ 30,071 Securities gains (losses) - 96 - - (71) 1,257 - - Actual non interest income (no
Slide 41: Reconciliation of Non-GAAP Disclosures: Diluted Earnings Per Share
Reconciliation of Non-GAAP Disclosures Diluted Earnings Per Share $ in thousands 2012 2013 2014 2015 2016 2017 2018 Net income (GAAP) $ 26,637 $ 33,487 $ 59,582 $ 68,014 $ 90,930 $ 92,188 $ 146,920 Merger and conversion expense, net of tax - 4,412 481 7,918 2,694 6,925 11,095 Debt prepayment penalti
Slide 42: Reconciliation of Non-GAAP Disclosures: Return on Assets
Reconciliation of Non-GAAP Disclosures Return on Assets $ in thousands 2012 2013 2014 2015 2016 2017 1Q18 2Q18 3Q18 4Q18 1Q19 Net income (GAAP) $ 26,637 $ 33,487 $ 59,582 $ 68,014 $ 90,929 $ 92,188 $ 33,826 $ 36,710 $ 31,964 $ 44,420 $ 45,110 Merger and conversion expense, net of tax - 4,412 481 7,9
Slide 43: Reconciliation of Non-GAAP Disclosures: Return on Tangible Equity
Reconciliation of Non-GAAP Disclosures Return on Tangible Equity $ in thousands 2012 2013 2014 2015 2016 2017 1Q18 2Q18 3Q18 4Q18 1Q19 Net income (GAAP) $ 26,637 $ 33,487 $ 59,582 $ 68,014 $ 90,929 $ 92,188 $ 33,826 $ 36,710 $ 31,964 $ 44,420 $ 45,110 Merger and conversion expense, net of tax - 4,41
Slide 44: Investor Inquiries
Investor Inquiries E. Robinson McGraw Chairman of the Board and Executive Chairman 209 TROY STREET TUPELO, MS 38804-4827 C. Mitchell Waycaster President and Chief Executive Officer PHONE: 1-800-680-1601 FACSIMILE: 1-662-680-1234 Kevin D. Chapman WWW.RENASANT.COM Senior Executive Vice President, WWW.