BancorpSouth in Tupelo, Miss., posted lower earnings, in part because of costs from a possible settlement of allegations related to its fair-lending practices.
The $13.9 billion-asset company's first-quarter net income fell 30% to $22.5 million, from a year earlier, it said Wednesday. The results included a pretax charge of $13.8 million to reflect a "probable and estimable liability" and related expenses tied to a regulatory matter, BancorpSouth said in the release.
The Consumer Financial Protection Bureau and the Justice Department have spent more than a year investigating the company's fair-lending practices. BancorpSouth is having "productive" discussions with the two agencies about a possible settlement, Chairman and Chief Executive Dan Rollins said in a news release.
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American Banker Research's Index of Banking Activity, which had the lowest reading in its nearly four-year history in January, revealed that issues in oil-producing states are contributing to decreases in commercial loan applications and approvals.
March 16 -
The Mississippi bank hopes its settlement talks with the CFPB and Justice Department ultimately clear the way for it to complete acquisitions in Texas and Louisiana, but time is running short.
January 26 -
The $13.8 billion-asset company said Monday after the market closed that it earned $21.2 million, down roughly 26% from a year earlier.
January 25
Overall noninterest expense rose 4% to $142.3 million. Salaries and benefits increased 1% to $82.5 million.
Net interest income rose about 5% to $111.2 million, while its net interest margin improved by 2 basis points to 3.56%. Loans and leases rose about 7% to $10.4 billion.
Noninterest income declined 10% to $65.5 million, because of an $8 million negative mortgage servicing rights valuation adjustment. Credit and debit card and merchant fees increased 5% to $9 million.
BancorpSouth currently has deals pending to buy Ouachita Bancshares in Monroe, La., and Central Community in Temple, Texas. The deals, announced in January 2014, were first delayed by an enforcement action related to problems with BancorpSouth's anti-money-laundering compliance. They are now delayed by the probe into BancorpSouth's fair lending. Although the merger agreements were not extended past a Dec. 31 deadline, the deals are still in effect, according to BancorpSouth's earnings release.
