RENASANT CORP [RNST] Filings

10-Q 1 rnst-20240630.htm 10-Q rnst-20240630

Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

________________________________________________________

FORM 10-Q

________________________________________________________

(Mark One)


☒			Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended June 30, 2024


☐			Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from to

Commission file number: 001-13253

________________________________________________________

RENASANT CORPORATION

(Exact name of registrant as specified in its charter)

________________________________________________________


Mississippi						64-0676974
(State or other jurisdiction of						(I.R.S. Employer
incorporation or organization)						Identification No.)

209 Troy Street,

Tupelo,

Mississippi

38804-4827

(Address of principal executive offices)

(Zip Code)

(662) 680-1001

(Registrant’s telephone number, including area code)

________________________________________________________

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common stock, $5.00 par value per share	RNST	The New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☒	Accelerated filer	☐

Non-accelerated filer	☐	Smaller reporting company	☐

		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Table of Contents

As of July 31, 2024, 63,557,383 shares of the registrant’s common stock, $5.00 par value per share, were outstanding.

Table of Contents

Renasant Corporation and Subsidiaries

Form 10-Q

For the Quarterly Period Ended June 30, 2024

CONTENTS


		Page
PART I	Financial Information
Item 1.	Financial Statements (Unaudited)
	Consolidated Balance Sheets	1
	Consolidated Statements of Income	2
	Consolidated Statements of Comprehensive Income	3
	Consolidated Statements of Changes in Shareholders’ Equity	4
	Consolidated Statements of Cash Flows	5
	Notes to Consolidated Financial Statements	6

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	48

Item 3.	Quantitative and Qualitative Disclosures about Market Risk	74

Item 4.	Controls and Procedures	74

PART II	Other Information


Item 1A.	Risk Factors	75

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	77

Item 5.	Other Information	79

Item 6.	Exhibits	79

SIGNATURES		81

Table of Contents

PART I. FINANCIAL INFORMATION

Item 1. FINANCIAL STATEMENTS

Renasant Corporation and Subsidiaries

Consolidated Balance Sheets

(In Thousands, Except Share Data)


	(Unaudited)
	June 30, 2024		December 31, 2023
Assets
Cash and due from banks	$	224,302	$	206,680
Interest-bearing balances with banks	627,604		594,671
Cash and cash equivalents	851,906		801,351
Securities held to maturity (net of allowance for credit losses of $32 at each of June 30, 2024 and December 31, 2023) (fair value of $1,052,705 and $1,121,830, respectively)	1,174,663		1,221,464
Securities available for sale, at fair value	749,685		923,279
Loans held for sale, at fair value	266,406		179,756



Loans held for investment, net of unearned income	12,604,755		12,351,230
Allowance for credit losses on loans	(199,871)		(198,578)
Loans, net	12,404,884		12,152,652
Premises and equipment, net	280,966		283,195
Other real estate owned, net	7,366		9,622
Goodwill	991,665		991,665
Other intangible assets, net	16,397		18,795
Bank-owned life insurance	387,791		382,584
Mortgage servicing rights	72,092		91,688
Other assets	306,570		304,484
Total assets	$	17,510,391	$	17,360,535
Liabilities and shareholders’ equity
Liabilities
Deposits
Noninterest-bearing	$	3,539,453	$	3,583,675
Interest-bearing	10,715,760		10,493,110
Total deposits	14,255,213		14,076,785
Short-term borrowings	232,741		307,577
Long-term debt	428,677		429,400
Other liabilities	239,059		249,390
Total liabilities	15,155,690		15,063,152
Shareholders’ equity
Preferred stock, $0.01 par value – 5,000,000 shares authorized; no shares issued and outstanding	—		—
Common stock, $5.00 par value – 150,000,000 shares authorized; 59,296,725 shares issued; 56,367,924 and 56,142,207 shares outstanding, respectively	296,483		296,483
Treasury stock, at cost – 2,928,801 and 3,154,518 shares, respectively	(97,534)		(105,249)
Additional paid-in capital	1,304,782		1,308,281
Retained earnings	1,005,086		952,124
Accumulated other comprehensive loss, net of taxes	(154,116)		(154,256)
Total shareholders’ equity	2,354,701		2,297,383
Total liabilities and shareholders’ equity	$	17,510,391	$	17,360,535

See Notes to Consolidated Financial Statements.

Table of Contents

Renasant Corporation and Subsidiaries

Consolidated Statements of Income (Unaudited)

(In Thousands, Except Share Data)


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2024		2023		2024		2023
Interest income
Loans	$	201,927	$	176,188	$	396,625	$	339,712
Securities
Taxable	9,258		12,300		18,763		25,553
Tax-exempt	1,152		1,700		2,347		3,538
Other	7,874		6,978		15,655		12,408
Total interest income	220,211		197,166		433,390		381,211
Interest expense
Deposits	87,621		51,391		170,234		84,257
Borrowings	7,564		15,559		14,840		30,963
Total interest expense	95,185		66,950		185,074		115,220
Net interest income	125,026		130,216		248,316		265,991
Provision for credit losses on loans	4,300		3,000		6,938		10,960
Recovery of credit losses on unfunded commitments	(1,000)		(1,000)		(1,200)		(2,500)
Provision for credit losses	3,300		2,000		5,738		8,460
Net interest income after provision for credit losses	121,726		128,216		242,578		257,531
Noninterest income
Service charges on deposit accounts	10,286		9,733		20,792		18,853
Fees and commissions	3,944		4,987		7,893		9,663
Insurance commissions	2,758		2,809		5,474		5,255
Wealth management revenue	5,684		5,338		11,353		10,478
Mortgage banking income	9,698		9,771		21,068		18,288
Gain on debt extinguishment	—		—		56		—
Net loss on sales of securities	—		(22,438)		—		(22,438)
BOLI income	2,701		2,402		5,392		5,405

Other	3,691		4,624		8,115		9,015
Total noninterest income	38,762		17,226		80,143		54,519
Noninterest expense
Salaries and employee benefits	70,731		70,637		142,201		140,469
Data processing	3,945		3,684		7,752		7,317
Net occupancy and equipment	11,844		11,865		23,233		23,270
Other real estate owned	105		51		212		81
Professional fees	3,195		4,012		6,543		7,479
Advertising and public relations	3,807		3,482		8,693		8,168
Intangible amortization	1,186		1,369		2,398		2,795
Communications	2,112		2,226		4,136		4,206




Other	15,051		12,839		29,720		25,588
Total noninterest expense	111,976		110,165		224,888		219,373
Income before income taxes	48,512		35,277		97,833		92,677
Income taxes	9,666		6,634		19,578		17,956
Net income	$	38,846	$	28,643	$	78,255	$	74,721


Basic earnings per share	$	0.69	$	0.51	$	1.39	$	1.33
Diluted earnings per share	$	0.69	$	0.51	$	1.38	$	1.33
Cash dividends per common share	$	0.22	$	0.22	$	0.44	$	0.44

See Notes to Consolidated Financial Statements.

Table of Contents

Renasant Corporation and Subsidiaries

Consolidated Statements of Comprehensive Income (Unaudited)

(In Thousands)


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2024		2023		2024		2023
Net income	$	38,846	$	28,643	$	78,255	$	74,721
Other comprehensive income, net of tax:
Securities available for sale:
Unrealized holding gains (losses) on securities	468		(15,930)		(4,166)		(399)
Reclassification adjustment for losses realized in net income	—		16,816		—		16,816

Amortization of unrealized holding losses on securities transferred to the held to maturity category	2,421		2,252		4,859		4,580
Total securities available for sale	2,889		3,138		693		20,997
Derivative instruments:
Unrealized holding losses on derivative instruments	(141)		(2,361)		(711)		(3,593)

Total derivative instruments	(141)		(2,361)		(711)		(3,593)
Defined benefit pension and post-retirement benefit plans:


Amortization of net actuarial loss recognized in net periodic pension cost	79		86		158		172
Total defined benefit pension and post-retirement benefit plans	79		86		158		172
Other comprehensive income, net of tax	2,827		863		140		17,576
Comprehensive income	$	41,673	$	29,506	$	78,395	$	92,297

See Notes to Consolidated Financial Statements.

Table of Contents

Renasant Corporation and Subsidiaries

Consolidated Statements of Changes in Shareholders’ Equity

(Unaudited)

(In Thousands, Except Share Data)


	Common Stock			Treasury Stock		Additional Paid-In Capital		Retained Earnings		Accumulated Other Comprehensive Loss		Total
Six Months Ended June 30, 2024	Shares	Amount
Balance at January 1, 2024	56,142,207	$	296,483	$	(105,249)	$	1,308,281	$	952,124	$	(154,256)	$	2,297,383

Net income	—	—		—		—		39,409		—		39,409
Other comprehensive loss	—	—		—		—		—		(2,687)		(2,687)
Comprehensive income												36,722
Cash dividends ($0.22 per share)	—	—		—		—		(12,653)		—		(12,653)


Issuance of common stock for stock-based compensation awards	162,653	—		5,566		(8,660)		—		—		(3,094)
Stock-based compensation expense	—	—		—		3,992		—		—		3,992

Balance at March 31, 2024	56,304,860	$	296,483	$	(99,683)	$	1,303,613	$	978,880	$	(156,943)	$	2,322,350
Net income	—	$	—	$	—	$	—	$	38,846	$	—	$	38,846
Other comprehensive income	—	—		—		—		—		2,827		2,827
Comprehensive income												41,673
Cash dividends ($0.22 per share)	—	—		—		—		(12,640)		—		(12,640)


Issuance of common stock for stock-based compensation awards	63,064	—		2,149		(2,205)		—		—		(56)
Stock-based compensation expense	—	—		—		3,374		—		—		3,374

Balance at June 30, 2024	56,367,924	$	296,483	$	(97,534)	$	1,304,782	$	1,005,086	$	(154,116)	$	2,354,701


	Common Stock			Treasury Stock		Additional Paid-In Capital		Retained Earnings		Accumulated Other Comprehensive Loss		Total
Six Months Ended June 30, 2023	Shares	Amount
Balance at January 1, 2023	55,953,104	$	296,483	$	(111,577)	$	1,302,422	$	857,725	$	(209,037)	$	2,136,016

Net income	—	—		—		—		46,078		—		46,078
Other comprehensive income	—	—		—		—		—		16,713		16,713
Comprehensive income												62,791
Cash dividends ($0.22 per share)	—	—		—		—		(12,561)		—		(12,561)


Issuance of common stock for stock-based compensation awards	120,554	—		4,018		(6,409)		—		—		(2,391)
Stock-based compensation expense	—	—		—		3,445		—		—		3,445

Balance at March 31, 2023	56,073,658	$	296,483	$	(107,559)	$	1,299,458	$	891,242	$	(192,324)	$	2,187,300
Net income	—	$	—	$	—	$	—	$	28,643	$	—	$	28,643
Other comprehensive income	—	—		—		—		—		863		863
Comprehensive income												29,506
Cash dividends ($0.22 per share)	—	—		—		—		(12,573)		—		(12,573)


Issuance of common stock for stock-based compensation awards	58,820	—		1,970		(970)		—		—		1,000
Stock-based compensation expense	—	—		—		3,395		—		—		3,395

Balance at June 30, 2023	56,132,478	$	296,483	$	(105,589)	$	1,301,883	$	907,312	$	(191,461)	$	2,208,628

See Notes to Consolidated Financial Statements.

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Renasant Corporation and Subsidiaries

Consolidated Statements of Cash Flows (Unaudited)

(In Thousands)


	Six Months Ended June 30,
	2024		2023
Operating activities
Net income	$	78,255	$	74,721
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Provision for credit losses	5,738		8,460
Depreciation, amortization and accretion	16,027		18,365
Deferred income tax expense	1,142		302
Proceeds from sale of MSR	23,011		—
Gain on sale of MSR	(3,472)		—
Funding of mortgage loans held for sale	(641,131)		(659,921)
Proceeds from sales of mortgage loans held for sale	561,475		526,853
Gains on sales of mortgage loans held for sale	(9,734)		(9,417)

Losses on sales of securities	—		22,438
Debt prepayment benefit	(56)		—
Losses on sales of premises and equipment	52		7
Stock-based compensation expense	7,366		6,840

Increase in other assets	(6,802)		(26,264)
(Decrease) increase in other liabilities	(15,891)		6,076
Net cash provided by (used in) operating activities	15,980		(31,540)
Investing activities
Purchases of securities available for sale	(52,679)		—
Proceeds from sales of securities available for sale	177,185		488,981
Proceeds from call/maturities of securities available for sale	42,713		90,830


Proceeds from call/maturities of securities held to maturity	50,372		54,123
Net increase in loans	(258,608)		(363,231)
Purchases of premises and equipment	(6,774)		(12,353)
Proceeds from sales of premises and equipment	289		—

Net change in FHLB stock	2,665		13,268
Proceeds from sales of other assets

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