Renasant (RNST) Q4 2024 earnings summary

Executive summary

• Q4 2024 net income was $44.7 million, with diluted EPS of $0.70 and adjusted EPS of $0.73, reflecting stable profitability and strong financial performance.

• Loans grew by $257.4 million (8.1% annualized), and deposits increased by $62.9 million, with brokered deposits eliminated by year-end.

• Announced and progressing with a transformative merger with The First Bancshares, Inc., expected to close in H1 2025, with active integration planning.

• Focus remained on organic growth, disciplined pricing, deposit growth, and steady credit performance.

• Teams from both companies are engaged in integration and regulatory approval processes.

Financial highlights

• Net interest income for Q4 2024 was $135.5 million, up $1.9 million sequentially; net interest margin held steady at 3.36%.

• Noninterest income fell $55.1 million sequentially due to a $53.3 million gain on insurance agency sale in Q3; adjusted noninterest income decreased $1.7 million.

• Noninterest expense decreased $7.2 million sequentially, with merger and conversion expenses at $2.1 million for Q4.

• Book value per share was $42.13; tangible book value per share was $26.36, both rising sequentially.

• Nonperforming loans were 0.88% of total loans, down 6 basis points sequentially; allowance for credit losses on loans was 1.57%.

Outlook and guidance

• Modest net interest margin expansion is expected in 2025, reversing prior guidance for compression, due to better-than-expected deposit pricing and stable loan yields.

• Loan growth outlook remains positive, with strong pipelines across geographies and business lines.

• Expense growth is guided to 2%-3% for 2025, with ongoing focus on cost control despite some unusual items in 2024.

• The acquisition of The First Bancshares is expected to accelerate profitability improvement and provide meaningful EPS accretion.

• Management expects continued focus on integration and realization of cost savings, with capital ratios expected to remain well-positioned post-acquisition.