See Notes to Condensed Consolidated Financial Statements

3

Index to Financial Statements

RENASANT CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(in thousands, except share data)

(unaudited)

See Notes to Condensed Consolidated Financial Statements

4

Index to Financial Statements

RENASANT CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOMECASH FLOWS

(in thousands, except share data)thousands)

(unaudited)

See Notes to Condensed Consolidated Financial Statements

5

Index to Financial Statements

RENASANT CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(unaudited)

See Notes to Condensed Consolidated Financial Statements

RENASANT CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

MARCH 31,SEPTEMBER 30, 2007

(in thousands, except share data)

Note 1 Summary of Significant Accounting Policies

Business: Renasant Corporation (referred to herein as the “Company”), a Mississippi corporation, owns and operates Renasant Bank, a Mississippi-chartered bank with operations in Mississippi, Tennessee and Alabama, and Renasant Insurance, Inc., a wholly-owned subsidiary of Renasant Bank with operations in Mississippi. The Company has full service offices located throughout north and north central Mississippi, west and middle Tennessee and north and north central Alabama.

Basis of Presentation: The accompanying unaudited condensed consolidated financial statements of the Company and its subsidiaries have been prepared in accordance with generally accepted accounting principles for interim financial information and in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. For further information regarding the Company’s accounting policies, refer to the consolidated financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2006. Certain amounts in prior periods have been reclassified to conform to the current presentation.

On July 24, 2006,1, 2007, the Company announced a three-for-two stock splitcompleted its acquisition of Capital Bancorp, Inc. (“Capital”). The financial condition and results of operation for Capital are included in the form of a stock dividend payable on August 28, 2006 to shareholders of record as of August 11, 2006. As a resultCompany’s financial statements since the date of the stock split,acquisition. See Note 11, “Mergers and Acquisitions,” in these Notes to Consolidated Financial Statements for further details regarding the Company issued 5,744,010 sharesterms and conditions of its common stock. Share and per share amounts included herein have been restated to reflect the three-for-two stock split.Company’s merger with Capital.

New accounting pronouncements:

In September 2006, the Financial Accounting Standards Board (“FASB”) issued Statement of Financial Accounting Standards No. 157, “Fair Value Measurements” (“Statement 157”), which provides guidance for using fair value to measure assets and liabilities. This statement also requires expanded disclosures about the extent to which a company measures assets and liabilities at fair value, the information used to measure fair value, and the effect of fair value measurements on earnings. This statement applies whenever other standards require or permit assets and liabilities to be measured at fair value. This statement does not mandate the use of fair value in any circumstance. Statement 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007, and interim periods within those fiscal years, with early adoption permitted. The Company is in the process of reviewing the potential impact of this statement.

In February 2007, the FASB issued Statement of Financial Accounting Standards No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities” (“Statement 159”). Statement 159 allows entities to voluntarily choose, at specified election dates, to measure financial assets and financial liabilities (as well as certain nonfinancial instruments that are similar to financial instruments) at fair value (the “fair value option”). The election is made on an instrument-by-instrument basis and is irrevocable. If the fair value option is elected for an instrument, Statement 159 specifies that all subsequent changes in fair value for that instrument be reported in earnings. Statement 159 is effective as of the beginning of an entity’s first fiscal year that begins after November 15, 2007, with early adoption permitted. The Company is in the process of reviewing the potential impact of this statement.

Note 2 Shareholders’ Equity

In September 2002, the Company’s board of directors adopted a share buy-back plan which, as amended through March 31,September 30, 2007, allows the Company to purchase up to 2,095,031 shares of its outstanding common stock, subject to a monthly purchase limit of $2,000 of the Company’s common stock. This plan will remain in effect until all authorized shares are repurchased or until otherwise instructed by the board of directors. During the nine months ended September 30, 2007, the Company repurchased 198,553 common shares in open market transactions at an average price of $20.17. As of March 31,September 30, 2007, 264,75666,203 shares remained authorized under this plan. The reacquired common shares are held as treasury shares and

may be reissued for various corporate purposes. During the threenine months ended March 31,September 30, 2007, the Company reissued 23,53188,341 shares from treasury in connection with the vesting and exercise of stock-based compensation. The Company did not repurchase any shares during the first three months of 2007.

6

Index to Financial Statements

The Company declared a cash dividend for the firstthird quarter of 2007 of $0.16$0.17 per share as compared to $0.15$0.16 per share for the firstthird quarter of 2006. Total cash dividends paid to shareholders by the Company were $2,498$9,022 and $2,379$7,281 for the threenine month periods ended March 31,September 30, 2007 and 2006, respectively.

In January 2007, the Company granted 176,250 stock options which become vested and exercisable in equal installments of 33 1/3% ¹/3% upon completion of one, two and three years of service measured from the grant date. In addition, the Company awarded 5,500 shares of time-based restricted stock and 21,000 shares of performance-based restricted stock in January, 2007. The time-based restricted stock is earned 100% upon completion of three years of service measured from the grant date. The performance-based restricted stock is earned, in part, if the Company meets or exceeds financial performance results defined by the Boardboard of Directors.directors.

On May 11, 2007, the Company completed the sale of 2,400,000 shares of its common stock at a price of $22.50 per share in a firm commitment underwritten offering. On June 1, 2007, the Company completed the sale of 360,000 shares of its common stock in connection with the exercise of the over-allotment option granted to the underwriters associated with the aforementioned offering. Net proceeds from the offering, including proceeds received in connection with the underwriters’ exercise of their over-allotment option, totaled $58,126.

In connection with its acquisition of Capital, the Company issued 2,797,238 shares of its common stock at a value of $67,497 and assumed Capital’s outstanding options with a value of $2,496.

Note 3 Loans

The Company adopted and applied the provisions of the American Institute of Certified Public Accountants Statement of Position 03-3, “Accounting for Certain Loans or Debt Securities Acquired in a Transfer,” on certain loans acquired in connection with the acquisition of Heritage Financial Holding Corporation (“Heritage”).Corporation. There was evidence of deterioration of the credit quality of these loans since origination, and it was probable, at the acquisition date, that all contractually required payments would not be collected. The amount of such loans included in the balance sheet heading “Loans, net of unearned income” at March 31,September 30, 2007 is as follows:

The Company did not increase the allowance for loan losses for these loans during the threenine months ended March 31,September 30, 2007.

7

Index to Financial Statements

Note 4 Goodwill

The changes in the carrying amount of intangible assets during the first nine months of 2007 are as follows:

The adjustment to previously recorded goodwill reflects tax benefits associated with the exercise of stock options assumed in connection with the acquisitions of Heritage and Renasant Bancshares, Inc.

Note 45 Interest Rate Swap

In May 2006, the Company entered into an interest rate swap with a notional amount of $100,000 whereby it will receivereceives a fixed rate of interest and paypays a variable rate based on the Prime rate. The effective date of the swap was May 11, 2006 and the maturity date of the swap is May 11, 2009. The interest rate swap is a designated cash flow hedge designed to convert the variable interest rate on $100,000 of loans to a fixed rate. TheThis hedging relationship is assessed under the hypothetical derivative method, and the swap is considered to be effective and the assessment of the hedging relationship is evaluated under the hypothetical derivative method.effective. At March 31,September 30, 2007, the swap had a fair value of $723$860 which has been recorded in “Other Assets”. The Company accounts for the swap in accordance with FASB Statement of Financial Accounting Standards No. 133, “Accounting for Derivative Instruments and Hedging Activities.”

Note 56 Comprehensive Income

The components of comprehensive income, net of related tax, are as follows:

8

Index to Financial Statements

Note 67 Employee Benefit Plans

The following tables provide the components of net pension cost and other benefit cost recognized for the three and nine month periods ended March 31,September 30, 2007 and 2006:

Note 78 Income Taxes

FASB Interpretation 48, “Accounting for Income Tax Uncertainties” (“FIN 48”), was issued in June 2006 and defines the threshold for recognizing the benefits of tax return positions in the financial statements as “more-likely-than-not” to be sustained by the taxing authority. FIN 48 also provides guidance on the derecognition, measurement and classification of income tax uncertainties, along with any related interest and penalties, and includes guidance concerning accounting for income tax uncertainties in interim periods. The Company adopted the provisions of FIN 48, on January 1, 2007, and determined there was no need to make an adjustment to retained earnings upon adoption of this Interpretation.FIN 48. As of January 1, 2007, the Company has $171 of unrecognized tax benefits related to federal and state income tax matters. If ultimately recognized, the Company does not anticipate any material increase in the effective tax rate during 2007 relative to any tax positions taken prior to January 1, 2007. As of January 1, 2007, the Company has accrued $26 for interest and penalties related to uncertain tax positions. It is the Company’s policy to recognize interest and/or penalties related to income tax matters in income tax expense.

The Company and its subsidiaries file a consolidated U.S. federal income tax return. The Company is currently open to audit under the statute of limitations by the Internal Revenue Service for the years ending December 31, 2003 through 2006. The Company and its subsidiaries’ state income tax returns are open to audit under the statute of limitations for the years ended December 31, 2003 through 2006.

9

Index to Financial Statements

Note 89 Net Income Per Common Share

Basic net income per common share is calculated by dividing net income by the weighted-average number of common shares outstanding for the period. Diluted net income per common share reflects the pro forma dilution assuming outstanding stock options and warrants were exercised into common shares, calculated in accordance with the treasury stock method. Basic and diluted net income per common share calculations are as follows:

Note 910 Segment Reporting

FASB Statement No. 131, “Disclosures About Segments of an Enterprise and Related Information,” requires public companies to report certain financial and descriptive information about their reportable operating segments (as defined by management) and certain enterprise-wide financial information about products and services, geographic areas and major customers.

The Company’s internal reporting process is organized into four segments that account for the Company’s principal activities: the delivery of financial services through its community banks in Mississippi (Mississippi Region), Tennessee (Tennessee Region) and Alabama (Alabama Region), and the delivery of insurance services through its insurance agency (Renasant Insurance). In order to give the Company’s regional management a more precise indication of the income and expenses they can control, the results of operations for the regions of the community bank and the insurance company reflect the direct revenues and expenses of each respective segment. The Company believes this management approach will enable its regional management to focus on serving customers through loan originations and deposit gathering. Indirect revenues and expenses, including but not limited to income from the Company’s investment portfolio and costs associated with our data processing and back office functions, are not allocated to its segments. Rather, these revenues and expenses are shown in the “Other” column, which also includes revenues and expenses associated with the operations of the holding company and eliminations which are necessary for purposes of reconciling to the consolidated amounts.

		Community Bank									Renasant Insurance			Other				Consolidated
		Mississippi Region			Tennessee Region			Alabama Region
At or for the three month period ended March 31, 2007:
Net interest income		$	13,861		$	3,077		$	4,968		$	21		$	(1,266	)		$	20,661
Provision for loan losses			307			149			294			—			—				750
Noninterest income			8,021			326			2,388			1,026			916				12,677
Noninterest expense			7,544			2,195			4,286			734			7,742				22,501
Income before income taxes			14,031			1,059			2,776			313			(8,092	)			10,087
Income tax expense			4,445			335			880			114			(2,649	)			3,125
Net income (loss)			9,586			724			1,896			199			(5,443	)			6,962
Total assets			1,555,315			468,290			721,549			6,099			3,677				2,754,930
Goodwill			2,265			39,217			47,096			2,783			—				91,361
At or for the three month period ended March 31, 2006:
Net interest income		$	13,418		$	2,762		$	5,212		$	1		$	(885	)		$	20,508
Provision for loan losses			625			107			336			—			—				1,068
Noninterest income			6,934			222			1,779			919			1,579				11,433
Noninterest expense			7,500			2,033			3,754			750			7,854				21,891
Income before income taxes			12,227			844			2,901			170			(7,160	)			8,982
Income tax expense			3,546			245			842			59			(2,211	)			2,481
Net income (loss)			8,681			599			2,059			111			(4,949	)			6,501
Total assets			1,459,880			409,013			631,285			5,290			3,752				2,509,220
Goodwill			2,265			39,217			47,168			2,783			—				91,433

10

Index to Financial Statements

11

Index to Financial Statements

Note 1011 Mergers and Acquisitions

On February 5,July 1, 2007, the Company announced the signingcompleted its acquisition by merger of a definitive merger agreement pursuant to which it proposes to acquire Capital, Bancorp, Inc. (“Capital”), a bank holding company headquartered in Nashville, Tennessee, and the parent of Capital Bank & Trust Company, a Tennessee banking corporation. On March 2, 2007, the same date, Capital Bank & Trust Company enteredwas merged into an amendment to the merger agreement. At March 31,Renasant Bank. On June 30, 2007, Capital operated seven full-service banking offices in the Nashville-Davidson-Murfreesboro, Tennessee Metropolitan Statistical Area and(the “Nashville MSA”). At June 30, 2007, Capital had total assets of $587.2 million, total$614,802, loans of $515,982, deposits of $475.7 million$490,257 and total shareholders’ equity of $36.1 million.

According$36,267. The acquisition of Capital allowed the Company to further its strategic initiatives by expanding its geographic footprint into the termsNashville MSA. The Company issued 2,797,238 shares of its common stock and paid $56,055 in cash for 100% of the voting equity interests in Capital. The common stock issued by the Company was registered under the Securities Act of 1933, as amended. The Company used the proceeds of its equity offering, discussed above in Note 2, “Shareholders’ Equity,” to pay the cash portion of the merger agreement (which means in this Note 10 the merger agreement as amended), each Capital common shareholder can elect to receive: (1) 1.2306 shares of the Company’s common stock for each share of Capital common stock, (2) $38.00 in cash for each share of Capital common stock or (3) a combination of 40% cash, in the amount listed above, and 60% common stock, at the same exchange ratio listed above.consideration. The merger agreement imposes an overall limitation that the aggregate stock consideration be no more than 65% and no less than 60% of the total consideration received by Capital shareholders. In the event that both the market value of the Company’s common stock and the value of the NASDAQ Bank Index decline by amounts specified in the merger agreement as of the date of determination, Capital may terminate the merger agreement, provided, however, that the Company may adjust the exchange ratio used in the merger agreement to account for the decline in the value of its stock price and proceed with the merger. Based on the Company’s market close of $27.92 on February 2, 2007, the trading day immediately prior to the announcement of the execution of the definitive merger agreement with Capital, the aggregate transaction value, including the dilutive impact of Capital’s options whichassumed by the Company, was $131,350. In connection with the acquisition, the Company recorded approximately $100,028 in intangible assets. The intangible assets are not deductible for income tax purposes.

The following table summarizes the allocation of purchase price to assets and liabilities acquired in connection with the Company’s acquisition of Capital based on their fair values on July 1, 2007. The Company is assumingfinalizing the value of certain assets and liabilities. As such, the adjustments included in the merger, was approximately $134.9 million.following table are preliminary and may change.

12

Index to Financial Statements

The acquisition is expected to close early infollowing unaudited pro forma combined condensed consolidated financial information presents the third quarterresults of operations for the nine months ended September 30, 2007 and is subject to regulatory and2006 of the Company as though the merger with Capital shareholder approval, Company shareholder approval to the extent required by applicable law and the rules of The NASDAQ Stock Market and other conditions set forth inequity offering to fund the merger agreement. Pursuant to the termscash portion of the merger agreement, Capital Bank & Trust is expectedconsideration had been completed as of the beginning of each respective period.

13

Index to merge with and into Renasant Bank immediately after the merger of Capital with and into the Company.

Financial Statements

Note 11 Subsequent Event

On May 8, 2007, the Company announced that it has agreed to sell 2,400,000 shares of its common stock at an offering price of $22.50 through a firm commitment underwritten offering. The offering, which is scheduled to close on May 11, 2007, is subject to customary closing conditions contained in the underwriting agreement entered into between the Company and the underwriters. The Company has granted the underwriters an option exercisable within 30 days to purchase up to an additional 360,000 shares to cover over-allotments.

Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (dollar amounts in thousands, except per share data)

This Form 10-Q may contain, or incorporate by reference, statements regarding Renasant Corporation (referred to herein as the “Company”, “we,” “our,”“we”, “our”, or “us”) which may constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended. Such forward looking statements usually include words such as “expects,” “projects,” “proposes,” “anticipates,” “believes,” “intends,” “estimates,” “strategy,” “plan,” “potential,” “possible” and other similar expressions. Prospective investors are cautioned that any such forward-looking statements are not guarantees for future performance and involve risks and uncertainties and that actual results may differ materially from those contemplated by such forward-looking statements.

Important factors currently known to management that could cause actual results to differ materially from those in forward-looking statements include (1) the effect of economic conditions and interest rates on a national, regional or international basis; (2) risks associated with the Company’s proposed acquisition of Capital Bancorp, Inc. (“Capital”), including, without limitation, the risk that the Company may be unable to complete the acquisition and, if the acquisition is completed, risks relating to the Company’s ability to integrate Capital’s operations, the compatibility of the combining company’s operating systems and the degree to which existing administrative and back-office functions and costs are complimentary with or redundant of Capital’s; (3) the performance of the Company’s business after its merger with Capital; (4)Capital Bancorp, Inc. (“Capital”); (3) the timing of the implementation of changes in operations to achieve enhanced earnings or effect cost savings; (5)(4) competitive pressures in the consumer finance, commercial finance, insurance, financial services, asset management, retail banking, mortgage lending and auto lending industries; (6)(5) the financial resources of, and products available to, competitors; (7)(6) changes in laws and regulations, including changes in accounting standards; (8)(7) changes in policy by regulatory agencies; (9)(8) changes in the securities and foreign exchange markets; (10)(9) the Company’s potential growth, including its entrance or expansion into new markets, and the need for sufficient capital to support that growth; (11)(10) changes in the quality or composition of the Company’s loan or investment portfolios, including adverse developments in borrower industries or in the repayment ability of individual borrowers; (12)(11) an insufficient allowance for loan losses as a result of inaccurate assumptions; (13)(12) general economic, market or business conditions; (14)(13) changes in demand for loan products and financial services; (15)(14) concentration of credit exposure; (16)(15) changes or the lack of changes in interest rates, yield curves and interest rate spread relationship; and (17)(16) other circumstances, many of which are beyond management’s control. Management undertakes no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results over time.

Overview

Renasant Corporation, a Mississippi corporation, owns and operates Renasant Bank, a Mississippi-chartered bank with operations in Mississippi, Tennessee and Alabama, and Renasant Insurance, Inc., a Mississippi corporation with operations in Mississippi. Renasant Insurance, Inc. is a wholly-owned subsidiary of Renasant Bank. The Company has full service offices located throughout north and north central Mississippi, west and middle Tennessee and north and north central Alabama.

On July 24, 2006, the Company announced a three-for-two stock split in the form of a stock dividend payable on August 28, 2006 to shareholders of record as of August 11, 2006. As a result of the stock split, the Company issued 5,744,010 shares of its common stock. Share and per share amounts included herein have been restated to reflect the three-for-two stock split.

On February 5,May 11, 2007, the Company announcedcompleted the signingsale of 2,400,000 shares of its common stock at a definitiveprice of $22.50 per share in a firm commitment underwritten offering. On June 1, 2007, the Company completed the sale of 360,000 shares of its common stock in connection with the exercise of the over-allotment option granted to the underwriters associated with the aforementioned offering. Net proceeds from the offering, including proceeds received in connection with the underwriters’ exercise of their over-allotment option, totaled $58,126.

On July 1, 2007, the Company completed its acquisition by merger agreement pursuant to which it proposes to acquireof Capital, Bancorp, Inc., a bank holding company headquartered in Nashville, Tennessee, and the parent of Capital Bank & Trust Company, a Tennessee banking corporation. On March 2, 2007, the same date, Capital Bank & Trust Company enteredwas merged into an amendment to the merger agreement.Renasant Bank. At March 31,June 30, 2007, Capital operated seven full-service banking offices in the Nashville-Davidson-Murfreesboro, Tennessee Metropolitan Statistical Area and had total assets of $587.2 million, total$614,802, loans of $515,982, deposits of $475.7 million$490,257 and total shareholders’ equity of $36.1 million.$36,267. See Note 10,11, “Mergers and Acquisitions,” in the Notes to Consolidated Financial Statements included in Item 1, “Condensed Consolidated Financial Statements,” for details regarding the terms and conditions of the Company’s merger agreement, as amended, with Capital.

14

Index to Financial Statements

Financial Condition

Total assets for the Company increased to $2,754,930$3,584,519 on March 31,September 30, 2007 from $2,611,356 on December 31, 2006, representing an increase of 5.50%37.27%. The acquisition of Capital contributed total assets of $614,802, or 63.18% of the increase in total assets.

Cash and cash equivalents increased $56,974decreased $6,553 from $98,201 at December 31, 2006 to $155,175$91,648 at March 31,September 30, 2007. Cash and cash equivalents represented 5.63%2.56% of total assets at March 31,September 30, 2007 compared to 3.76% of total assets at December 31, 2006. Our investment portfolio increased to $462,588$543,017 at March 31,September 30, 2007 from $428,065 at December 31, 2006 as we invested excess funds from2006. The acquisition of Capital contributed investment securities with a balance of $72,234, or 62.84% of the generation of deposits.increase in investments.

Mortgage loans held for sale were $29,098$25,911 at March 31,September 30, 2007 compared to $38,672 at December 31, 2006. TheOriginations of mortgage loans to be sold totaled $457,636 for the first nine months of 2007 as compared to $334,795 for the same period in 2006. In the first nine months of 2007, the Company was able to grow its levels of mortgage originations in an environment in which mortgage activity nationally continues to slow as compared to prior years. OriginationsThis increase in originations of mortgage loans to be sold totaled $140,850 forwas due in part to the first three monthsexpansion of 2007 as compared to $94,210 for same periodour retail mortgage operations in Alabama and the hiring of a group of wholesale mortgage lenders in Mississippi in the latter part of the third quarter of 2006. Mortgage loans to be sold are locked in at a contractual rate with third party private investors, and the Company is obligated to sell the mortgages to such investors only if the mortgages are closed and funded. Gains and losses are realized at the time consideration is received from the sale of the loans and all other criteria for sales treatment have been met. These loans are typically sold within thirty days after the loan is funded. Although some interest income is derived from mortgage loans held for sale, the main source of income is gains from the sale of mortgage loans in the secondary market. The Company does not actively market or originate subprime mortgage loans. For the first nine months of 2007, originations of subprime mortgage loans constituted .05% of the aggregate originations of mortgage loans.

The loan balance, net of unearned income, at March 31,September 30, 2007 was $1,889,799,$2,588,563, representing an increase of $63,037$761,801 from $1,826,762 at December 31, 2006. The acquisition of Capital contributed total loans of $515,982, or 67.73% of the increase in total loans. Excluding Capital’s loans, loans increased $245,819 from December 31, 2006.

The growth in loans during the first threenine months of 2007 is primarily attributable to loan production across all three of our geographic regions. Excluding the loans acquired from our Mississippi and Alabama regions. LoansCapital, loans in the Mississippi, Tennessee and Alabama regions grew $24,087$66,854, $82,064 and $29,568,$96,901, respectively, during the first threenine months of 2007 compared to the respective balances at December 31, 2006. Loans in the Tennessee region grew $9,382 during this same period. We expect future loan growth to be primarily from the Tennessee and Alabama regions and from certain key markets within the Mississippi region. The table below sets forth loans outstanding, according to loan type, net of unearned income.