BancorpSouth raises dividend to 5 cents

BancorpSouth announced it will a dividend of 5 cents a share on Oct. 1. BXSLogoHorizontalColor

It’s the first time BancorpSouth has raised its dividend after it cut its quarterly payment to 1 cent a share in the second quarter of 2011.

Here’s what the Tupelo-based bank had to say:

Dan Rollins, Chief Executive Officer of BancorpSouth, commented, “We are very pleased to announce this increased payment to our shareholders; a level of payment that is consistent with current industry dividend payout ratios, which measure the size of a dividend payment compared to the company’s net income.  As shareholders, our Board has clearly understood and shared the desire to enhance our dividend and return more capital to our shareholders.  Our decision reflects the confidence that we have in the strength of our enterprise risk management system, the strength of our core capital base, and the belief that our strategic plan will continue to produce profitable growth.”

The $0.05 per share payment is the first increase in the Company’s cash dividend since the reduction of the quarterly payment to $0.01 per share in the second quarter of 2011.

CEO Dan Rollins continued, “I am encouraged with the progress made through the first half of this year towards our efforts to improve our efficiency and expense control, our continued progress in improving asset quality, and our revenue growth opportunities as we continue to emphasize to our people the importance of growth, both in our loan portfolio and in our lines of business.”

At the end of the second quarter 2013, the Company achieved quarter-over-quarter loan growth for the first time in three years, while the Company’s earnings benefitted from strong performances from a wide range of noninterest lines of business.  The Company’s insurance brokerage division is presently the fourth largest bank-owned agency in the country according to the recently published Michael White Bank Insurance Fee Income Report, and its mortgage division continues to produce solid origination volume despite the industry headwinds produced by declining refinance activity.

Commenting on BancorpSouth’s on-going efficiency initiatives, Rollins said, “We remain committed to lowering our cost structure, as evidenced by the recently announced Voluntary Early Retirement Program and the $125 million trust preferred securities redemption that was completed earlier this month. The retirement program is expected to result in fully phased-in annual pre-tax savings of approximately $9 million, or $0.06 per share net of tax. The trust preferred redemption is expected to result in an annual reduction of interest expense of approximately $9 million, or $0.06 per share net of tax.”

“Our executive management team recently completed a series of 20 meetings over the course of three weeks traveling throughout BancorpSouth’s 8-state footprint meeting with our lenders, producers, managers, and support staff to communicate and discuss face-to-face our strategic focus and key objectives that are critical to moving our Company forward. With a customer-focused community bank business model and a comprehensive line of financial products, our team is energized, enthusiastic and focused on growing our Company and enhancing shareholder value,” concluded Rollins.

BancorpSouth reported net income of $20.8 million or $0.22 per diluted share for the second quarter of 2013.

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