Renasant (US:RNST)2021-02-26 20:07Banking Operations - As of December 31, 2020, the company had over 190 banking, lending, and mortgage offices across Mississippi, Tennessee, Alabama, Florida, Georgia, North Carolina, and South Carolina[25]. - The company offers a broad range of deposit services, including consumer checking accounts with free online and mobile banking[46]. - The Company maintained approximately 13.4% market share in Mississippi, 1.3% in Tennessee, 1.4% in Alabama, 1.4% in Florida, and 1.9% in Georgia as of 2020[55]. - The deposit share in Tupelo, Mississippi was 45.8%, with other notable shares including 12.8% in DeSoto County and 33.9% in Starkville[56]. - The Bank may establish additional branch offices within Mississippi and outside the state, subject to regulatory approval[79]. Lending Activities - Lending activities accounted for approximately 84.01%, 79.32%, and 78.22% of total gross revenues in 2020, 2019, and 2018, respectively[26]. - Commercial, financial, and agricultural loans represented approximately 23.20% of total loans as of December 31, 2020[28]. - Residential real estate loans comprised approximately 24.68% of total loans, with $4.48 billion originated for sale on the secondary market in 2020[31]. - Commercial mortgage loans accounted for approximately 41.66% of total loans as of December 31, 2020[34]. - Construction loans represented approximately 7.85% of total loans as of December 31, 2020[38]. - The company aims to manage its loan portfolio to avoid excessive concentrations, targeting a structure of approximately one-third C&I loans, one-third non-owner occupied commercial real estate loans, and one-third residential real estate loans and consumer loans[42]. Revenue Sources - Investment income from investment activities accounted for approximately 4.46%, 5.41%, and 5.38% of total gross revenues in 2020, 2019, and 2018, respectively[45]. - Deposit services accounted for approximately 5.88%, 7.78%, and 9.52% of total gross revenues in 2020, 2019, and 2018, respectively[48]. - The Wealth Management segment generated total revenue of $19.7 million, representing 2.66% of the Company's total gross revenues for 2020[51]. - Renasant Insurance contributed total revenue of $11.0 million, or 1.48% of the Company's total gross revenues in 2020[52]. Regulatory Environment - The U.S. banking industry is highly regulated, affecting the Company's growth and earnings performance due to compliance with federal and state laws[59]. - The Federal Reserve requires bank holding companies to maintain a minimum Tier 1 capital ratio of at least 4%[66]. - The Company has not elected to become a financial holding company, which would allow it to engage in a broader range of financial activities without prior approval[64]. - The BHC Act mandates prior approval from the Federal Reserve for acquisitions or mergers that would result in owning more than 5% of another bank's voting shares[70]. - The Bank is required to maintain a common equity Tier 1 capital (CET1) ratio of not less than 4.5% and a minimum total risk-based capital ratio of 8%[84]. - The minimum designated reserve ratio of the Deposit Insurance Fund (DIF) is currently 1.35% of total insured deposits[76]. - The Bank's assessment rate for deposit insurance is based on risk classification and is subject to a surcharge designed to increase the DIF to specified levels[77]. - The capital conservation buffer required is 2.5% of CET1 to risk-weighted assets in addition to minimum risk-based capital requirements[84]. - The maximum permissible interchange fee for debit transactions is capped at 21 cents plus 5 basis points of the transaction value[93]. - The Bank is subject to examination by the CFPB due to having more than $10 billion in assets, affecting compliance with federal consumer protection laws[75]. - The Bank has established policies to ensure compliance with federal anti-money laundering laws and regulations[108]. - The Volcker Rule limits the scope of permissible activities for the Bank in the future but does not impact current activities[109]. Employee and Operational Policies - The Bank employs 2,524 people as of December 31, 2020, with 2,458 in the Bank and 66 in Renasant Insurance[114]. - The Company implemented personnel policies to minimize COVID-19 exposure, including remote work and enhanced paid leave practices[115]. - A voluntary early retirement window program was offered to eligible employees, providing cash payments and retiree medical coverage[116]. - The Company established a Social Responsibility Diversity and Inclusion Committee to address workplace inclusion and diversity[117]. Compliance and Risk Management - The Company implemented a loan deferral program to mitigate the impact of the COVID-19 pandemic on consumer and commercial customers[42]. - The Bank has established numerous controls and procedures to ensure compliance with the TRID rules and all consumer protection laws, with annual training for employees[102]. - The Bank received a "satisfactory" rating from the FDIC regarding its compliance with the Community Reinvestment Act in its most recent assessment[104]. - The Bank's ability to pay dividends is restricted by federal and state laws, requiring earned surplus to exceed three times capital stock[81]. - The FDIC may terminate the deposit insurance of any institution if it determines unsafe or unsound practices, with accounts insured for a period of six months to two years post-termination[78]. - The Federal Reserve reduced reserve requirements to zero percent in March 2020, effectively eliminating the Bank's reserve requirements[99].