Renasant Corporation · NYSE:RNST
Renasant — Investor Presentation (November 2018)
46 slides from Renasant's investor presentation, Nov 7, 2018
Slide 1: Q4 2018 Investor Presentation Financial Information – 9-30-18
Q4 2018 Investor Presentation Financial Information – 9-30-18
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% 36% Western 24% Central 18% Total Deposits* Northern 15% Eastern Western 34% 38% Central 13% 3 *As of September 30, 2018
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
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 Highlights* Assets $12.75 billion Gross Loans $9.12 billion Deposits $10.17 billion *As of September 30, 2018 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: Transaction Terms and Multiples
Transaction Terms and Multiples Target: . Brand Group Holdings, Inc. (“Brand”) . $474 million aggregate consideration (1)(2) Implied Purchase Price: . $1,556 per Brand common share (1) . 95% stock / 5% cash Consideration: ‒ 31.72 RNST shares and $74.57 of cash for each Brand common share ‒ Tax free
Slide 10: Transaction Rationale
Transaction Rationale Strategically Important ‒ Acquisition of 110+ year-old bank with quality core client base • $1.25 billion in transaction-related core deposits ‒ Strengthens RNST’s market presence in the attractive Atlanta MSA to be ranked in the top 10 (1) • 29% of pro forma franchise locate
Slide 11: 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 ~$300bn BrandExpress ‒ 8th largest in the U.S. Branch
Slide 12: Our Atlanta Franchise
Our Atlanta Franchise Atlanta MSA Deposit Market Share Pro Forma Atlanta MSA Branch Footprint (1) Deposits Market Rank Institution ($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 Cherokee 3 SunTrust Banks Inc. 14,200 13.2 152 Hall
Slide 13: Our Combined Company
Our Combined Company Current Footprint Financial Highlights Assets $12.75 billion Johnson City Knoxville 40 40 Nashville Loans $9.12 billion TENNESSEE Memphis 65 24 Deposits $10.17 billion Huntsville 75 Branches 162 Tupelo 20 Loans/Deposits 89.7% Birmingham Atlanta Augusta 20 Auburn Macon Deposits b
Slide 14: 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 15: 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 16: Diluted Earnings Per Share
Diluted Earnings Per Share* $3.00 $0.90 $0.80 0.78 $0.75 $2.50 $2.42 $2.31 $0.70 $0.70 $2.10 $0.64 $0.61 $0.62 $0.59 $0.59 $0.59 $2.00 $1.89 $0.60 $0.54 $0.55 $0.50 $1.50 $1.38 $0.40 $1.09 $1.00 $0.30 $0.20 $0.50 $0.10 $0.00 $0.00 2012 2013 2014 2015 2016 2017 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17
Slide 17: Enhanced Profitability
Enhanced Profitability Return on Assets* Return on Tangible Equity* 1.60% 20.00% 1.45% 1.47% 1.39% 17.66% 1.40% 18.00% 17.11% 16.37% 16.34% 16.10%16.23% 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% 0.40% 4.00% 0.20% 2.00% 0.0
Slide 18: Total Portfolio Loans
Total Portfolio Loans $10,000,000 • Loans not purchased increased $9,000,000 $152 million, or 10% annualized, $8,000,000 during 3Q18 $7,000,000 • Loan production for 3Q18 was $6,000,000 $404 million $5,000,000 • Company maintains strong $4,000,000 pipelines throughout all $3,000,000 markets which wi
Slide 19: Diversified Loan Portfolio
Diversified Loan Portfolio . At September 30, 2018, loans totaled $9.1 billion 68% Not Purchased 32% Purchased Non Owner Occupied 26% Owner Occupied 18% C&I 13% Consumer 1-4 Family 2% 30% Const Land Dev 8% 2% 19
Slide 20: 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% 277% 87% 267% 251% 250% 82% 83% 244% 244% 81% 80% 8
Slide 21: Focus on Core Funding
Focus on Core Funding $12,000,000 2.50% $10,000,000 2.00% $8,000,000 ) 1.50% $6,000,000 1.00% $4,000,000 ($ in thousands ($ 0.50% $2,000,000 $- 0.00% 2013 2014 2015 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 Total Deposits Cost of Deposits Fed Funds $2,500,000 Non Interest Bearing Demand
Slide 22: Net Interest Income and Net Interest Expense
Net Interest Income and Net Interest Expense 6.00% 6.00% 5.00% 5.00% 4.00% 4.00% 3.00% 3.00% Margin Yield/Cost 2.00% 2.00% 1.00% 1.00% 0.00% 0.00% 2013 2014 2015 2016 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 Yield on Earning Assets Cost of Funds Margin ($ in thousands) 2013 2014 2015 2016 1Q17 2Q17 3Q17 4
Slide 23: 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 Expan
Slide 24: Improved Efficiency
Improved Efficiency 80.00% • Continued focus on managing noninterest expenses and 75.00% improving efficiency • Provided resources for eight 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
Slide 25: 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 26: 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 $13.5M $12.8M 0.50% ORE $4.7M $
Slide 27: 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 • 5 bps in 3Q18 350% • Provision for loan losses: $4,000 300% • $2.25 million in 3Q18 250% $3,000 ($ inthousands) ($ 200% $2,000 150% 100% $1,000 50% $- 0% ($)Provision for Loan Losses ($)Net Cha
Slide 28: 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 $0 2013 2014 2015 2016 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 ($ in thousands) *Amounts exclude loans and assets purchased in connection with recent acquis
Slide 29: 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 30: Strong Capital Position
Strong Capital Position • Maintained dividend throughout economic downturn 10.50% Tangible Common Equity Ratio* • Increased quarterly dividend four times since 2Q16 9.50% • Regulatory capital ratios are well above the minimum for 8.50% well-capitalized classification • Capital level positions the Co
Slide 31: Consistent and Strong Dividend
Consistent and Strong Dividend Dividends Per Share – Annually Dividends Per Share – Quarterly $0.80 $0.25 $0.70 $0.20 $0.60 $0.50 $0.15 $0.40 $0.30 $0.10 $0.20 $0.05 $0.10 $0.00 $0.00 31
Slide 32: Poised for Growth with Added Shareholder Value
Poised for Growth with Added Shareholder Value . $12.75B franchise well positioned in attractive markets in the Southeast . Merger with Brand Group Holdings, Inc. added $2.3B in assets, $1.7M in deposits and $1.6M in loans on the acquisition date . Strategic focus on expanding footprint • Acquisitio
Slide 33: Appendix
[QRENASANT "ORPORATION. Appendix 33
Slide 34: 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. $21,90
Slide 35: Florida – Central Region
Florida – Central Region . Entered the Florida market through the acquisition of HBOS. Florida Deposit Market Share Moved into FL with 6 full-services branches along I-75 Deposits Market Rank Institution ($mm) Share Branches . Opened Mortgage Production Offices in Destin and Jacksonville in 1Q 1 B
Slide 36: 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. $5
Slide 37: Mississippi – Western Region
Mississippi – Western Region . Increased presence in Mississippi with the recent acquisition of Metropolitan BancGroup, Inc., which Mississippi Deposit Market Share closed 7/1/17 Deposits Market Rank Institution ($mm) Share Branches Added 4-full service branches 1 Trustmark Corp. $7,601 14.1 % 122
Slide 38: 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 39: Reconciliation of Non-GAAP Disclosures: Tangible Common Equity
Reconciliation of Non-GAAP Disclosures Tangible Common Equity 39
Slide 40: Reconciliation of Non-GAAP Disclosures: Efficiency Ratio
Reconciliation of Non-GAAP Disclosures Efficiency Ratio 40
Slide 41: Reconciliation of Non-GAAP Disclosures: Efficiency Ratio (Excluding Mortgage)
Reconciliation of Non-GAAP Disclosures Efficiency Ratio (Excluding Mortgage) 41
Slide 42: Reconciliation of Non-GAAP Disclosures: Non Interest Income
Reconciliation of Non-GAAP Disclosures Non Interest Income 42
Slide 43: Reconciliation of Non-GAAP Disclosures: Diluted Earnings Per Share
Reconciliation of Non-GAAP Disclosures Diluted Earnings Per Share 43
Slide 44: Reconciliation of Non-GAAP Disclosures: Return on Assets
Reconciliation of Non-GAAP Disclosures Return on Assets 44
Slide 45: Reconciliation of Non-GAAP Disclosures: Return on Tangible Equity
Reconciliation of Non-GAAP Disclosures Return on Tangible Equity 45
Slide 46: 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.