January 19, 2012 12:30:00 PM
TUPELO -- BancorpSouth Inc. said Tuesday that fourth-quarter profit dropped even as it cut loan losses.
The regional bank, with $13 billion in assets, posted a profit of $13.3 million, or 16 cents per share, in the last three months of 2011. That's down 16 percent from $15.8 million, or 19 cents per share, in 2010's fourth quarter.
Earnings topped the 14 cents per share predicted by analysts surveyed by FactSet.
The company said it would sell $100 million in stock, using the money for general purposes, including boosting capital or acquiring other banks and insurance agencies.
Profit fell in part because of a drop in fees earned from mortgage lending and from credit and debit cards.
Despite the drop in profit, BancorpSouth officials said they were pleased with the results. They noted that the Tupelo-based bank had cut its provision for future losses to $19.3 million in the fourth quarter. It was the third straight quarter that set-asides for loan losses fell, and they were less than half the $43.3 million that BancorpSouth recorded in 2010's fourth quarter.
"Our results for the fourth quarter reflect meaningful progress in our efforts to improve credit quality," Chairman and CEO Aubrey Patterson said in a statement.
Patterson also said that BancorpSouth had fixed a "material weakness" found by auditors last year. That problem had led the bank to be slow in recognizing souring loans.
"The hard work applied to address our deficiencies will provide stronger credit processes in the future," Patterson said.
BancorpSouth's total average loans continued to shrink, falling to $8.75 billion in the fourth quarter, down 2 percent from the average amount in 2011's third quarter. The bank continued to purge its construction, acquisition and development portfolio, where losses have been high.