Jul 21, 2014 9:57 PM by Associated Press
BancorpSouth's acquisitions of a bank in Louisiana and one in Texas are being delayed because of federal inquiries into BancorpSouth's practices.
The Tupelo, Mississippi-based bank made the announcement Monday as it released financial results for its second quarter.
BancorpSouth said it's being delayed in gaining regulatory approvals to acquire Ouachita Bancshares Corp. of Monroe, Louisiana, which owns Ouachita Independent Bank, as well as Central Community Corp. of Temple, Texas, which owns First State Bank of Central Texas.
In a news release, BancorpSouth said federal bank regulators have found problems with its compliance with the Bank Secrecy Act and programs to fight money laundering. BancorpSouth also said the federal Consumer Financial Protection Bureau is reviewing the bank's fair lending practices.
When the acquisitions were announced earlier this year, BancorpSouth proposed to pay $115 million in stock and cash for Ouachita Bancshares and $210.8 million in stock and cash for Central Community. BancorpSouth said the two banks, whose stockholders have approved the sales, have extended the deadlines for the purchases until June 30, 2015.
"While disappointed in the delay in being able to close these transactions, we are working diligently to resolve the compliance concerns that have been identified and to make the necessary improvements in our compliance programs," Chairman and CEO Dan Rollins said in a statement. "We are pleased with the confidence that our merger partners have demonstrated through the extension of the merger agreements."
BancorpSouth said profit for the three months ending on June 30 rose 49 percent from 2013's second quarter, hitting $30.9 million, or 32 cents per share, compared with $20.8 million, or 22 cents per share in the year-ago quarter.
Analysts polled by FactSet had estimated 33 cents per share, on average. The company hit that mark once merger expenses were screened out.
BancorpSouth continued to benefit from fewer bad loans, setting aside no money for future bad loans for the second quarter in a row, compared to $3 million in 2013's second quarter. The bank also continued to benefit from lower expenses after an employee buyout it made last year.
The $13 billion bank has offices in Alabama, Arkansas, Florida, Louisiana, Mississippi, Missouri, Tennessee and Texas.
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