Renasant acquires $1 billion Georgia bank

By Dennis Seid/NEMS Daily Journal

TUPELO – In announcing its fourth and largest acquisition since 2004, Renasant Bank also expanded its footprint into a fourth state.
On Friday, Renasant said it was acquiring Crescent Bank & Trust of Jasper, Ga., in an Federal Deposit Insurance Corp.-assisted transaction. The deal adds $1 billion in assets, pushing Renasant’s ledger to $4.6 billion.
Under the terms of the Crescent deal, Renasant acquired more than $600 million of loans and other real estate and about $50 million of investment securities. Renasant also assumed about $900 million in deposits. Renasant paid a 1 percent premium to assume Crescent’s deposits.
Crescent’s closure is expected to cost the deposit insurance fund about $242.4 million.
Renasant Chairman and CEO E. Robinson McGraw said, “In looking at and researching FDIC-assisted transactions, we saw Crescent Bank as a tremendous opportunity to enhance our franchise while at the same time giving us access to new markets that would have otherwise been more difficult to enter.”
FDIC-assisted banks like Crescent Bank are under the agency’s protection to avoid failure and are sold to other banks in a bidding process.
Regulators shut down Crescent Bank on Friday, transferring its assets and deposits to Renasant.
Crescent Bank had been hit hard the past two years with the housing market collapse, posting losses of more than $30 million each year, including a pre-tax loss of $39.1 million for 2009.
In its annual report, Crescent said 94 percent of its loan portfolio was secured by commercial and residential real estate. And in the first quarter of this year, it lost nearly $14 million.
Renasant and the FDIC entered into a what is called a loss-sharing arrangement that covers substantially all of the acquired loans and other real estate.
In the loss-share transaction, the FDIC offers to reimburse the acquiring bank – in this case Renasant – 80 percent of losses incurred in a covered portfolio up to an agreed-upon threshold.
Beyond that, the reimbursement rate increases to 95 percent.
Banking industry officials have said they expect such loss-share deals to increase as healthy banks look to grow.
Said McGraw: “This opportunity represents Renasant’s fourth expansion since 2004 outside of Mississippi, which is our legacy market. We have a successful track record with our past expansions into Memphis and Nashville, as well as Huntsville, Decatur and Birmingham, Alabama, and believe this new partnership represents a logical expansion as a financial services leader in the mid-South.”

Acquisitions began in ’04
Renasant had been doing business strictly in Mississippi until 2004, when the then People’s Bank & Trust Co. acquired Renasant Bank, a Memphis-area based bank.
In 2005, People’s acquired Heritage Bank & Trust in Birmingham. Since there was already a People’s Bank in Alabama, the Tupelo-based People’s adopted the Renasant name that year. Two years later, Renasant acquired Capital Bank & Trust in Nashville.
Friday’s acquisition was Renasant’s first since the Capital deal in July 2007.
Renasant on Tuesday announced second-quarter earnings of nearly $3.8 million. In comments with that news, McGraw said that despite challenges in the economy and the industry, “we are optimistic in our outlook for long-term success as we continue to position ourselves for opportunities to grow and enhance our franchise.”
And in March, McGraw said he was looking at the possibility of an FDIC-assisted bank acquisition to help grow Renasant.
“We’ve indicated that we would be participating in the FDIC-assisted deals that are going to be out there,” he told the Memphis Commercial Appeal. “Hopefully we’ll be fortunate enough to be an acquirer under those circumstances.”
And for Renasant, the acquisition target was Crescent Bank, which was formed in 1989 by business and community leaders in Pickens County, Ga. It serves the northern metropolitan Atlanta counties of Pickens, Cherokee, Bartow, Forsyth and northern Fulton with 11 full-service locations.
Crescent Bank locations that normally open on Saturdays will reopen at normal banking hours today as Renasant Bank locations, and the remaining Crescent Bank locations will open as Renasant Bank locations Monday.
Crescent Bank’s closure on Friday was one of five announced by the FDIC. So far this year, 101 banks have closed.

Contact Dennis Seid at (662) 678-1578 or dennis.seid@djournal.com.

Renasant acquisitions
– 2004: The former Peoples Bank & Trust Co.
merged with Memphis-area based Renasant Bank.
– 2005: Acquired Heritage Bank and Trust in
Birmingham. People’s rebranded itself as Renasant Bank.
– 2007: Acquired Capital Bank & Trust in
Nashville
– 2010: Acquired Crescent Bank & Trust