<< Back
BancorpSouth Announces Earnings of $0.39 per Diluted Share for Fourth Quarter 2007

TUPELO, Miss., Jan. 23 /PRNewswire-FirstCall/ -- BancorpSouth, Inc. (NYSE: BXS) today announced financial results for the fourth quarter and year ended December 31, 2007.

    Highlights of the announcement include:
    --  An increase in net income and net income per diluted share for the
        fourth quarter of 2007 of 14.8 percent and 11.4 percent, respectively,
        from the fourth quarter of 2006.
    --  A 16.6 percent increase in loans and leases, net of unearned income,
        to $9.2 billion at the end of 2007 from the end of 2006.
    --  Expansion of the net interest margin to 3.72 percent for the fourth
        quarter of 2007 from 3.64 percent for the fourth quarter of 2006 and
        3.66 percent for the third quarter of 2007.
    --  Net interest revenue of $109.7 million for the fourth quarter of 2007,
        up 13.9 percent from the fourth quarter of 2006.
    --  Strong credit quality, with minimal exposure to subprime residential
        mortgages.
    --  Growth in noninterest revenue of 9.6 percent for the fourth quarter of
        2007 compared with the fourth quarter of 2006.
    --  Recognition of a $2.3 million charge in the fourth quarter of 2007
        related to a guarantee of Visa's obligations for certain litigation
        matters.


    Fourth Quarter 2007 Summary Results

The Company's net income for the fourth quarter of 2007 increased 14.8 percent to $32.2 million from $28.1 million for the fourth quarter of 2006. Net income per diluted share rose 11.4 percent to $0.39 for the fourth quarter of 2007 from $0.35 for the fourth quarter of 2006.

2007 Summary Results

BancorpSouth's net income for 2007 increased 10.2 percent to $137.9 million from $125.2 million for 2006. Net income per diluted share rose 7.6 percent to $1.69 for 2007 from $1.57 for 2006.

Aubrey Patterson, Chairman and Chief Executive Officer of BancorpSouth, commented, "BancorpSouth achieved profitable growth for the fourth quarter of 2007 and produced a strong performance for the full year. BancorpSouth stood out in a year during which an uncertain economy and an expanding credit crisis significantly affected many financial institutions. It also validated our continuing commitment to a conservative business philosophy designed to produce long-term profitable growth in an industry inherently at risk from interest rate volatility and the economic cycle.

"We attribute a significant portion of the Company's growth for 2007 to the acquisition of The Signature Bank. This transaction further illustrates our proven, conservative expansion strategy, as we entered contiguous markets that were familiar. We focus on markets with diverse economies that produce steady, significant growth and that can perform consistently throughout the economic cycle. As we also do with de novo expansion, we entered these new markets with a veteran management team who share our focus on providing high quality customer service to retail and small to mid-sized businesses.

"In addition, the Company's financial results for the fourth quarter and full-year 2007 reflected conservative lending and credit philosophies that have made strong credit quality a hallmark characteristic of BancorpSouth. As a result, our exposure to the credit issues affecting the subprime residential mortgage market remained immaterial and measures of credit quality continued to be within historic ranges.

"Our long-term strategy of diversifying revenue to reduce interest-rate spread dependency also served us well in 2007. With a comprehensive array of financial products and services, we again produced substantial comparable- quarter growth in noninterest revenue for the fourth quarter, even as a softening insurance market affected the expansion of insurance commission revenue, which had been a primary driver of noninterest revenue growth for the previous seven quarters."

Net Interest Revenue

Interest revenue for the fourth quarter of 2007 increased 13.5 percent, or $24.2 million, to $203.6 million from $179.4 million for the fourth quarter of 2006 and decreased 2.1 percent from $208.0 million for the third quarter of 2007. Interest expense increased 13.0 percent, or $10.8 million, to $93.9 million for the fourth quarter of 2007 from $83.1 million for the fourth quarter of 2006 and decreased 6.1 percent from $100.0 million for the third quarter of 2007.

The average taxable equivalent yield on earning assets increased to 6.84 percent for the fourth quarter of 2007 from 6.70 percent for the fourth quarter of 2006 and decreased from 6.98 percent for the third quarter of 2007. The average rate paid on interest bearing liabilities was 3.68 percent for the fourth quarter of 2007, compared with 3.67 percent for the fourth quarter of 2006 and 3.92 percent for the third quarter of 2007.

Net interest revenue increased 13.9 percent to $109.7 million for the fourth quarter of 2007 from $96.3 million for the fourth quarter of 2006 and increased 1.6 percent from $107.9 million for the third quarter of 2007. Importantly, net interest margin increased to 3.72 percent for the fourth quarter of 2007 compared with 3.64 percent for the fourth quarter of 2006 and 3.66 percent for the third quarter of 2007.

"We produced double-digit comparable-quarter growth in net interest revenue for the second consecutive quarter," said Patterson. "In addition to the positive impact from the strong growth in loans, our expansion of net interest revenue was driven by conservative asset/liability management strategies designed to lower interest rate risk. We continued to fund loan growth for the fourth quarter primarily by redeploying capital from maturing securities into higher yielding loans. This strategy enabled us to restructure liabilities through more selective pricing of public fund deposits and greater use of Federal Home Loan Bank borrowings. While the aggregate impact of these asset/liability management strategies contributed significantly to the improvement in net interest margin on a comparable- quarter and sequential-quarter basis, our strategies also reflected our commitment to serve the needs of core deposit customers and to sustain substantial levels of liquidity."

Deposit and Loan Activity

Total assets at December 31, 2007 increased 9.6 percent to $13.2 billion from $12.0 billion at December 31, 2006. Total deposits grew 3.6 percent to $10.1 billion at December 31, 2007 from $9.7 billion at December 31, 2006. Loans and leases, net of unearned income, increased 16.6 percent to $9.2 billion at December 31, 2007 from $7.9 billion at December 31, 2006.

"The addition of loans from The Signature Bank acquisition accounted for the substantial majority of the 16.6 percent expansion in the portfolio for the fourth quarter of 2007 compared to the fourth quarter of 2006," added Patterson. "We also continued to produce solid organic loan growth, with loans and leases, net of unearned income, increasing 1.4 percent at the end of the quarter from the end of the third quarter. While this rate improved over the 1.0 percent sequential-quarter growth for the third quarter of 2007, it remained consistent with slowing activity due to continuing uncertainty evident in the national economic environment.

"The growth in total deposits also primarily resulted from the acquisition, with demand deposits increasing 5.8 percent during 2007 and savings and other time deposits increasing 1.6 percent. Reflecting the restructuring of the Company's liabilities through our asset/liability management efforts, total deposits at year end decreased 1.2 percent from the end of the third quarter, following sequential-quarter declines of 2.4 percent and 2.1 percent for the third and second quarters of 2007."

Provision for Credit Losses and Allowance for Credit Losses

For the fourth quarter of 2007, the provision for credit losses was $7.8 million compared with $6.3 million for the fourth quarter of 2006 and $5.7 million for the third quarter of 2007. Annualized net charge-offs were 0.21 percent of average loans and leases for the fourth quarter of 2007 compared with 0.25 percent for the fourth quarter of 2006 and 0.13 percent for the third quarter of 2007.

Non-performing loans and leases increased to $29.2 million, or 0.32 percent of loans and leases, at December 31, 2007 from $23.5 million, or 0.30 percent of loans and leases, at December 31, 2006 and declined from $31.3 million, or 0.35 percent of loans and leases, at September 30, 2007. The allowance for credit losses was 1.25 percent of loans and leases at December 31, 2007 compared with 1.26 percent of loans and leases at December 31, 2006 and 1.24 percent of loans and leases at September 30, 2007.

Patterson remarked, "We remain very pleased with our credit quality despite a challenging national economic environment. Non-performing loans and leases at the end of 2007 increased slightly as a percentage of total loans and leases from the end of 2006, while improving from the end of the third quarter of 2007. While we have seen an increase of $13.8 million in other real estate owned since the same time in 2006, we feel these properties will be liquidated without additional loss. Losses from the loans that were secured by these properties have already been reflected in the allowance for credit losses. Net charge-offs declined on a comparable-quarter basis, although they increased from unsustainably low levels for the third quarter of 2007. At 1.25 percent of loans and leases, the allowance for credit losses is consistent with historical levels. Our strong credit quality reflects our commitment to conservative lending policies throughout the economic cycle. These policies substantially limit the Company's participation in the subprime residential mortgage market. As a result, we continue to have only nominal exposure to the credit issues affecting that market, totaling approximately $329,000 at the end of 2007."

Noninterest Revenue

For the fourth quarter of 2007, noninterest revenue increased 9.6 percent to $55.3 million from $50.1 million for the fourth quarter of 2006. These results included a decline in the value of the mortgage servicing asset totaling $4.5 million for the fourth quarter of 2007 and $4.0 million for the fourth quarter of 2006.

Patterson continued, "The growth in noninterest revenue for the fourth quarter resulted from a long-term strategy of providing customers comprehensive financial products and services, which strengthen customer relationships and generate noninterest revenue. While our insurance business drove noninterest revenue growth for the first nine months of 2007, insurance commission revenue was essentially unchanged for the fourth quarter compared with the fourth quarter of 2006 due to soft industry conditions. As a result, other products and services accounted for the growth in noninterest revenue for the fourth quarter, including double-digit comparable-quarter growth in fee revenue from our credit and debit card business and in service charges. We were also pleased with the 6.8 percent growth in revenue from mortgage originations for the fourth quarter compared with the fourth quarter of 2006, and with the 10.1 percent growth in mortgage origination revenue for the full year."

Noninterest Expense

Noninterest expense increased 10.0 percent to $110.2 million for the fourth quarter of 2007 from $100.1 million for the fourth quarter of 2006 and increased 3.6 percent from $106.4 million for the third quarter of 2007. The comparable-quarter increase in noninterest expense is primarily attributable to the acquisition of The Signature Bank, effective March 1, 2007. The Company also incurred additional salaries, employee benefits and occupancy expense associated with the opening of new loan production offices and full- service branch bank offices during 2007, including two new full-service banking locations opened in suburban St. Louis. BancorpSouth recorded a $2.3 million charge in the fourth quarter for liabilities in connection with obligations of Visa, Inc. related to certain settled and pending litigation. BancorpSouth is a member bank of Visa and based on information provided by Visa regarding its planned initial public offering, BancorpSouth expects that its proportionate share of the proceeds will more than offset any liabilities related to such settled and pending litigation.

Capital Management

BancorpSouth repurchased 113,700 shares of its common stock during the fourth quarter of 2007 under a stock repurchase plan for the repurchase of up to three million shares that commenced on May 1, 2007 and expires on April 30, 2009. BancorpSouth will continue to evaluate additional share repurchase opportunities under this plan. The Company has repurchased approximately 12.0 million shares of its common stock since its original share repurchase program was initiated in 2001.

Summary

"We expect the difficult economic environment to continue to challenge the financial services industry," stated Patterson. "Our continuing commitment to conservative operating philosophies and the strength and diversity of markets across our geographic franchise have reduced its effects on the Company, as evidenced by our solid fourth quarter results. In addition, current conditions do not diminish BancorpSouth's substantial long-term opportunities for expanding profitably in existing markets through the addition of new products and services, and by geographic expansion into contiguous markets through de novo bank development and acquisition. As a result, the Company remains well positioned to pursue our long-term objectives as we enter 2008.

"In recognition of current market conditions, our immediate focus for the year will be on providing outstanding service to core customers served by existing operations. We intend to continue to expand into new contiguous markets, albeit cautiously and at a sustainable pace. We remain absolutely committed to preserving strong credit quality, and we will not sacrifice the strength and liquidity of our financial position to drive short-term revenue. These principles have enabled BancorpSouth to achieve a long-term record of profitable growth through many economic cycles. We are confident that they will support further progress toward our long-term goals during 2008."

Conference Call

BancorpSouth will conduct a conference call to discuss its fourth quarter 2007 results tomorrow, January 24, 2008, at 10:00 a.m. (Central Time). Investors may listen via the Internet by accessing BancorpSouth's website at http://www.bancorpsouth.com. A replay of the conference call will be available at BancorpSouth's website for at least two weeks following the call.

Forward-Looking Statements

Certain statements contained in this news release may not be based on historical facts and are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements may be identified by their reference to a future period or periods or by the use of forward-looking terminology such as "anticipate," "believe," "estimate," "expect," "may," "might," "will," "would," "could" or "intend." These forward-looking statements include, without limitation, statements relating to the liquidation of other real estate owned, proceeds from the Visa initial public offering offsetting liabilities related to Visa litigation, our ability to achieve long-term objectives, our focus for 2008, expansion into new markets, credit policy and repurchases under our common stock repurchase plan.

We caution you not to place undue reliance on the forward-looking statements contained in this news release in that actual results could differ materially from those indicated in such forward-looking statements because of a variety of factors. These factors may include, but are not limited to, the amount of BancorpSouth's liability with respect to litigation involving Visa, the amount of proceeds from the Visa initial public offering, changes in economic conditions and government fiscal and monetary policies, fluctuations in prevailing interest rates and the ability of BancorpSouth to manage its assets and liabilities to limit exposure to changing interest rates, the ability of BancorpSouth to increase noninterest revenue and expand noninterest revenue business, the ability of BancorpSouth to maintain credit quality, changes in laws and regulations affecting financial service companies in general, the ability of BancorpSouth to compete with other financial services companies, the ability of BancorpSouth to provide and market competitive services and products, changes in BancorpSouth's operating or expansion strategy, geographic concentration of BancorpSouth's assets, the ability of BancorpSouth to manage its growth and effectively serve an expanding customer and market base, the ability of BancorpSouth to achieve profitable growth and increase shareholder value, the ability of BancorpSouth to attract, train and retain qualified personnel, the ability of BancorpSouth to repurchase its common stock on favorable terms, the ability of BancorpSouth to identify, close and effectively integrate potential acquisitions, the ability of BancorpSouth to expand geographically and enter growing markets, changes in consumer preferences, other factors generally understood to affect the financial results of financial services companies, and other factors described from time to time in BancorpSouth's filings with the Securities and Exchange Commission. We undertake no obligation to update these forward-looking statements to reflect events or circumstances that occur after the date on which such statements were made.


    BancorpSouth, Inc. is a financial holding company headquartered in Tupelo,
Mississippi, with approximately $13.2 billion in assets.  BancorpSouth Bank, a
wholly-owned subsidiary of BancorpSouth, Inc., operates approximately 290
commercial banking, mortgage, insurance, trust and broker/dealer locations in
Alabama, Arkansas, Florida, Louisiana, Mississippi, Missouri, Tennessee and
Texas.



    BancorpSouth, Inc.
    Selected Financial Data
                                 Three Months Ended       Twelve Months Ended
                                    December 31,              December 31,
                                 2007         2006         2007         2006
    (Dollars in thousands,
     except per share
     amounts)
    Earnings Summary:
    Net interest revenue      $109,657      $96,251     $422,899     $385,799
    Provision for credit
     losses                      7,771        6,325       22,696        8,577
    Noninterest revenue         55,314       50,490      231,799      206,094
    Noninterest expense        110,169      100,141      428,058      393,154
    Income before income
     taxes                      47,031       40,275      203,944      190,162
    Income tax provision        14,803       12,202       66,001       64,968
    Net income                 $32,228      $28,073     $137,943     $125,194
    Earning per share:
     Basic                       $0.39        $0.35        $1.69        $1.58
     Diluted                     $0.39        $0.35        $1.69        $1.57


    Balance sheet data at
     December 31:
    Total assets                                     $13,189,841  $12,040,521
    Total earning assets                              11,948,038   10,879,587
    Loans and leases, net
     of unearned income                                9,179,684    7,871,471
    Allowance for credit
     losses                                              115,197       98,834
    Total deposits                                    10,064,099    9,710,578
    Common shareholders'
     equity                                            1,196,626    1,026,585
    Book value per share                                   14.54        12.98


    Average balance sheet
     data:
    Total assets           $13,080,720  $11,854,667  $12,857,135  $11,798,153
    Total earning assets    11,956,412   10,771,897   11,749,433   10,712,327
    Loans and leases, net
     of unearned income      9,105,475    7,797,381    8,784,940    7,579,935
    Total deposits          10,045,400    9,479,773   10,200,098    9,554,441
    Common shareholders'
     equity                  1,162,821    1,013,082    1,121,000    1,000,332

    Non-performing assets
     at December 31:
    Non-accrual loans and
     leases                                               $9,789       $6,603
    Loans and leases 90+
     days past due                                        18,671       15,282
    Restructured loans and
     leases                                                  721        1,571
    Other real estate
     owned                                                24,281       10,463

    Net charge-offs as a
     percentage of average
     loans (annualized)           0.21%        0.25%        0.14%        0.15%

    Performance ratios
     (annualized):
    Return on average
     assets                       0.98%        0.94%        1.07%        1.06%
    Return on common
     equity                      11.00%       10.99%       12.31%       12.52%

    Net interest margin           3.72%        3.64%        3.68%        3.70%

    Average shares
     outstanding - basic    82,230,448   79,098,187   81,505,510   79,140,379
    Average shares
     outstanding - diluted  82,482,626   79,513,993   81,844,343   79,542,734



                              BancorpSouth, Inc.
                          Consolidated Balance Sheet
                                 (Unaudited)
                                                   December 31,          %
                                                2007         2006     Change
                                             (Dollars in thousands)
    Assets
    Cash and due from banks                   $322,926     $444,033   (27.27%)
    Interest bearing deposits with other
     banks                                      12,710        7,418    71.34%
    Held-to-maturity securities, at
     amortized cost                          1,625,916    1,723,420    (5.66%)
    Available-for-sale securities, at fair
     value                                   1,001,194    1,041,999    (3.92%)
    Federal funds sold and securities
     purchased under agreement to
     resell                                        -        145,957  (100.00%)
    Loans and leases                         9,227,495    7,917,523    16.55%
      Less:  Unearned income                    47,811       46,052     3.82%
             Allowance for credit losses       115,197       98,834    16.56%
    Net loans and leases                     9,064,487    7,772,637    16.62%
    Loans held for sale                        128,532       89,323    43.90%
    Premises and equipment, net                317,379      287,215    10.50%
    Accrued interest receivable                 96,027       89,090     7.79%
    Goodwill                                   254,889      143,718    77.35%
    Other assets                               365,781      295,711    23.70%
        Total Assets                       $13,189,841  $12,040,521     9.55%
    Liabilities
    Deposits:
      Demand:  Noninterest bearing          $1,670,198   $1,817,223    (8.09%)
               Interest bearing              3,276,275    2,856,295    14.70%
      Savings                                  698,449      715,587    (2.39%)
      Other time                             4,419,177    4,321,473     2.26%
    Total deposits                          10,064,099    9,710,578     3.64%
    Federal funds purchased and
     securities sold under agreement
     to repurchase                             809,898      672,438    20.44%
    Short-term Federal Home Loan Bank
     borrowings                                706,586      200,000   253.29%
    Accrued interest payable                    37,746       36,270     4.07%
    Junior subordinated debt securities        160,312      144,847    10.68%
    Long-term Federal Home Loan Bank
     borrowings                                 88,977      135,707   (34.43%)
    Other liabilities                          125,597      114,096    10.08%
    Total Liabilities                       11,993,215   11,013,936     8.89%
    Shareholders' Equity
    Common stock                               205,748      197,774     4.03%
    Capital surplus                            198,620      113,721    74.66%
    Accumulated other comprehensive income
     (loss)                                     (7,214)     (24,742)  (70.84%)
    Retained earnings                          799,472      739,832     8.06%
    Total Shareholders' Equity               1,196,626    1,026,585    16.56%
    Total Liabilities & Shareholders'
     Equity                                $13,189,841  $12,040,521     9.55%



                              BancorpSouth, Inc.
                 Consolidated Condensed Statements of Income
                (Dollars in thousands, except per share data)
                                 (Unaudited)

                                                 Quarter Ended
                                   Dec-07      Sep-07      Jun-07      Mar-07
    INTEREST REVENUE:
    Loans and leases             $171,068    $174,787    $169,717    $153,241
    Deposits with other banks         274         316         268         286
    Federal funds sold and
     securities purchased
     under agreement to
     resell                           311         232         633       2,511
    Held-to-maturity
     securities:
        Taxable                    16,890      17,585      16,962      16,705
        Tax-exempt                  2,120       2,077       2,044       2,015
    Available-for-sale
     securities:
        Taxable                    10,227      10,554      10,839       9,592
        Tax-exempt                    941         960       1,010       1,115
    Loans held for sale             1,751       1,454       1,082       1,675
            Total interest
             revenue              203,582     207,965     202,555     187,140

    INTEREST EXPENSE:
    Interest bearing demand        19,765      22,189      21,992      19,887
    Savings                         1,934       2,503       2,481       2,383
    Other time                     52,551      55,728      55,459      51,985
    Federal funds purchased
     and securities sold
     under agreement to
     repurchase                     8,259       9,151       9,283       7,824
    Other                          11,416      10,478       6,682       6,393
            Total interest
             expense               93,925     100,049      95,897      88,472

            Net interest
             revenue              109,657     107,916     106,658      98,668
      Provision for credit
       losses                       7,771       5,727       7,843       1,355
            Net interest
             revenue, after
             provision for
             credit losses        101,886     102,189      98,815      97,313

    NONINTEREST REVENUE:
    Mortgage lending               (1,149)        100       5,484       1,779
    Credit card, debit card
     and merchant fees              7,904       7,667       7,391       6,874
    Service charges                18,125      17,281      17,677      15,396
    Trust income                    2,996       2,487       2,457       2,214
    Security gains, net                97           7          10           7
    Insurance commissions          16,181      17,542      17,665      19,794
    Other                          11,160      12,810       9,548      12,295
            Total noninterest
             revenue               55,314      57,894      60,232      58,359

    NONINTEREST EXPENSES:
    Salaries and employee
     benefits                      64,594      63,269      63,851      63,628
    Occupancy, net of rental
     income                         8,967       8,959       8,709       8,463
    Equipment                       6,078       6,057       6,053       6,026
    Other                          30,530      28,066      27,315      27,493
            Total noninterest
             expenses             110,169     106,351     105,928     105,610
            Income before
             income taxes          47,031      53,732      53,119      50,062
    Income tax expense             14,803      17,475      17,238      16,485
            Net income            $32,228     $36,257     $35,881     $33,577

    Net income per share:
     Basic                          $0.39       $0.44       $0.44       $0.42
     Diluted                        $0.39       $0.44       $0.43       $0.42



                                         Quarter Ended       Year To Date
                                             Dec-06       Dec-07       Dec-06
    INTEREST REVENUE:
    Loans and leases                       $147,784     $668,813     $553,265
    Deposits with other banks                   217        1,144          829
    Federal funds sold and securities
     purchased under agreement to resell        635        3,687        5,066
    Held-to-maturity securities:
        Taxable                              16,532       68,142       63,010
        Tax-exempt                            2,012        8,256        7,993
    Available-for-sale securities:
        Taxable                               9,653       41,212       42,351
        Tax-exempt                            1,170        4,026        5,024
    Loans held for sale                       1,366        5,962        4,353
            Total interest revenue          179,369      801,242      681,891

    INTEREST EXPENSE:
    Interest bearing demand                  16,228       83,833       60,145
    Savings                                   2,160        9,301        7,987
    Other time                               48,585      215,723      172,368
    Federal funds purchased and
     securities sold under agreement
     to repurchase                            8,940       34,517       29,889
    Other                                     7,205       34,969       25,703
            Total interest expense           83,118      378,343      296,092

            Net interest revenue             96,251      422,899      385,799
      Provision for credit losses             6,325       22,696        8,577
            Net interest revenue, after
             provision for credit losses     89,926      400,203      377,222

    NONINTEREST REVENUE:
    Mortgage lending                           (820)       6,214        6,117
    Credit card, debit card and merchant
     fees                                     6,793       29,836       25,779
    Service charges                          16,262       68,479       63,124
    Trust income                              3,703       10,154       10,388
    Security gains, net                           4          121           40
    Insurance commissions                    16,146       71,182       63,286
    Other                                     8,402       45,813       37,360
            Total noninterest revenue        50,490      231,799      206,094

    NONINTEREST EXPENSES:
    Salaries and employee benefits           60,178      255,342      234,580
    Occupancy, net of rental income           8,173       35,098       31,972
    Equipment                                 5,941       24,214       23,422
    Other                                    25,849      113,404      103,180
            Total noninterest expenses      100,141      428,058      393,154
            Income before income taxes       40,275      203,944      190,162
    Income tax expense                       12,202       66,001       64,968
            Net income                      $28,073     $137,943     $125,194

    Net income per share: Basic               $0.35        $1.69        $1.58
                          Diluted             $0.35        $1.69        $1.57



                              BancorpSouth, Inc.
                Average Balances, Interest Income and Expense,
                         and Average Yields and Rates
                            (Dollars in thousands)
                                 (Unaudited)
                                                      Quarter Ended
                                                    December 31, 2007
                                             Average                  Yield/
       (Taxable equivalent basis)            Balance      Interest     Rate
       ASSETS
       Loans, loans held for sale,
        and leases net of unearned
        income                               $9,216,034    $173,685     7.48%
       Held-to-maturity securities:
         Taxable                              1,498,608      16,890     4.47%
         Tax-exempt                             192,464       3,261     6.72%
       Available-for-sale securities:
         Taxable                                923,725      10,227     4.39%
         Tax-exempt                              79,422       1,448     7.23%
       Short-term investments                    46,159         585     5.03%
         Total interest earning
          assets and revenue                 11,956,412     206,096     6.84%
       Other assets                           1,241,631
       Less:  allowance for credit losses      (117,323)
           Total                            $13,080,720

       LIABILITIES AND
       SHAREHOLDERS' EQUITY
       Deposits:
         Demand - interest bearing           $3,214,493     $19,765     2.44%
         Savings                                700,583       1,934     1.09%
         Other time                           4,512,151      52,550     4.62%
       Short-term borrowings                  1,382,163      14,320     4.11%
       Junior subordinated debt                 161,556       3,302     8.11%
       Long-term debt                           141,576       2,054     5.75%
         Total interest bearing
           liabilities and expense           10,112,522      93,925     3.68%
       Demand deposits -
         noninterest bearing                  1,618,173
       Other liabilities                        187,204
         Total liabilities                   11,917,899
       Shareholders' equity                   1,162,821
         Total                              $13,080,720
       Net interest revenue                                $112,171
       Net interest margin                                              3.72%
       Net interest rate spread                                         3.15%
       Interest bearing liabilities to
        interest earning assets                                        84.58%

       Net interest tax equivalent
        adjustment                                           $2,514



                              BancorpSouth, Inc.
                Average Balances, Interest Income and Expense,
                         and Average Yields and Rates
                            (Dollars in thousands)
                                 (Unaudited)
                                                      Quarter Ended
                                                    December 31, 2006
                                             Average                  Yield/
       (Taxable equivalent basis)            Balance      Interest     Rate
       ASSETS
       Loans, loans held for sale,
        and leases net of unearned
        income                               $7,876,801    $149,992     7.55%
       Held-to-maturity securities:
         Taxable                              1,533,105      16,532     4.28%
         Tax-exempt                             185,158       3,096     6.63%
       Available-for-sale securities:
         Taxable                              1,018,403       9,653     3.76%
         Tax-exempt                              98,101       1,800     7.28%
       Short-term investments                    60,329         853     5.61%
         Total interest earning
          assets and revenue                 10,771,897     181,926     6.70%
       Other assets                           1,182,664
       Less:  allowance for credit losses       (99,894)
           Total                            $11,854,667

       LIABILITIES AND
       SHAREHOLDERS' EQUITY
       Deposits:
         Demand - interest bearing           $2,765,276     $16,228     2.33%
         Savings                                718,623       2,160     1.19%
         Other time                           4,292,368      48,585     4.49%
       Short-term borrowings                    925,273      11,197     4.80%
       Junior subordinated debt                 144,847       2,965     8.12%
       Long-term debt                           135,838       1,983     5.79%
         Total interest bearing
          liabilities and expense             8,982,225      83,118     3.67%
       Demand deposits -
         noninterest bearing                  1,703,506
       Other liabilities                        155,854
         Total liabilities                   10,841,585
       Shareholders' equity                   1,013,082
         Total                              $11,854,667
       Net interest revenue                                 $98,808
       Net interest margin                                              3.64%
       Net interest rate spread                                         3.03%
       Interest bearing liabilities to
        interest earning assets                                        83.39%

       Net interest tax equivalent
        adjustment                                           $2,557



                              BancorpSouth, Inc.
                Average Balances, Interest Income and Expense,
                         and Average Yields and Rates
                            (Dollars in thousands)
                                 (Unaudited)
                                                      Year to Date
                                                    December 31, 2007
                                             Average                  Yield/
       (Taxable equivalent basis)            Balance      Interest     Rate
       ASSETS
       Loans, loans held for sale,
        and leases net of unearned
        income                               $8,880,253    $678,155     7.64%
       Held-to-maturity securities:
         Taxable                              1,530,247      68,142     4.45%
         Tax-exempt                             189,234      12,701     6.71%
       Available-for-sale securities:
         Taxable                                977,459      41,212     4.22%
         Tax-exempt                              84,292       6,194     7.35%
       Short-term investments                    87,948       4,831     5.49%
         Total interest earning
          assets and revenue                 11,749,433     811,235     6.90%
       Other assets                           1,217,135
       Less:  allowance for credit losses      (109,433)
           Total                            $12,857,135

       LIABILITIES AND
       SHAREHOLDERS' EQUITY
       Deposits:
         Demand - interest bearing           $3,191,433     $83,833     2.63%
         Savings                                718,080       9,301     1.30%
         Other time                           4,636,436     215,723     4.65%
       Short-term borrowings                  1,057,057      48,098     4.55%
       Junior subordinated debt                 159,939      13,067     8.17%
       Long-term debt                           144,006       8,321     5.78%
         Total interest bearing
          liabilities and expense             9,906,951     378,343     3.82%
       Demand deposits -
         noninterest bearing                  1,654,149
       Other liabilities                        175,035
         Total liabilities                   11,736,135
       Shareholders' equity                   1,121,000
         Total                              $12,857,135
       Net interest revenue                                $432,892
       Net interest margin                                              3.68%
       Net interest rate spread                                         3.09%
       Interest bearing liabilities to
        interest earning assets                                        84.32%

       Net interest tax equivalent
        adjustment                                           $9,993



                              BancorpSouth, Inc.
                Average Balances, Interest Income and Expense,
                         and Average Yields and Rates
                            (Dollars in thousands)
                                 (Unaudited)
                                                      Year to Date
                                                    December 31, 2006
                                             Average                  Yield/
       (Taxable equivalent basis)            Balance      Interest     Rate
       ASSETS
       Loans, loans held for sale,
        and leases net of unearned
        income                               $7,647,131    $560,673     7.33%
       Held-to-maturity securities:
         Taxable                              1,517,430      63,010     4.15%
         Tax-exempt                             183,986      12,297     6.68%
       Available-for-sale securities:
         Taxable                              1,135,506      42,351     3.73%
         Tax-exempt                             106,635       7,730     7.25%
       Short-term investments                   121,639       5,895     4.85%
         Total interest earning
          assets and revenue                 10,712,327     691,956     6.46%
       Other assets                           1,184,643
       Less:  allowance for credit losses       (98,817)
           Total                            $11,798,153

       LIABILITIES AND
       SHAREHOLDERS' EQUITY
       Deposits:
         Demand - interest bearing           $2,886,030     $60,145     2.08%
         Savings                                744,106       7,987     1.07%
         Other time                           4,211,371     172,368     4.09%
       Short-term borrowings                    807,860      35,835     4.44%
       Junior subordinated debt                 144,847      11,791     8.14%
       Long-term debt                           136,411       7,966     5.84%
         Total interest bearing
          liabilities and expense             8,930,625     296,092     3.32%
       Demand deposits -
         noninterest bearing                  1,712,934
       Other liabilities                        154,262
         Total liabilities                   10,797,821
       Shareholders' equity                   1,000,332
         Total                              $11,798,153
       Net interest revenue                                $395,864
       Net interest margin                                              3.70%
       Net interest rate spread                                         3.14%
       Interest bearing liabilities to
        interest earning assets                                        83.37%

       Net interest tax equivalent
        adjustment                                          $10,065

SOURCE BancorpSouth, Inc.

CONTACT: L. Nash Allen, Jr., Treasurer and Chief Financial Officer, +1-662-680-2330, or Gary C. Bonds, Senior Vice President and Controller, +1-662-680-2332, both of BancorpSouth, Inc.

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: Statements in this press release regarding BancorpSouth, Inc.'s business which are not historical facts are "forward-looking statements" that involve risks and uncertainties. For a discussion of such risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see "Risk Factors" in the Company's Annual Report or Form 10-K for the most recently ended fiscal year.