1
EXHIBIT 99.2
Investor Presentation Materials
2
[LOGO BANCORP SOUTH]
EXPANDING THE
MID-SOUTH FINANCIAL
SERVICES PLATFORM
FIRST UNITED BANCSHARES, INC.
April 17, 2000
3
Forward Looking Statement
The forward-looking statements being made today are subject to risks and
uncertainties. The actual results of BancorpSouth, Inc. ("BancorpSouth") and
First United Bancshares, Inc. ("First United") may differ materially from those
set forth in such forward-looking statements. Reference is made to
BancorpSouth's and First United's reports filed with the Securities and Exchange
Commission for a discussion of factors that may cause such differences to occur.
1
4
Key Transaction Terms
Fixed Exchange Ratio: 1.125 BancorpSouth shares per First United Share
Purchase Price per First United Share: $18.00(1)
Transaction Value: $460 million(1)(2)
Implied Market Premium: 42.6%(3)
Pro Forma Market Capitalization: $1,375 million
Company Name: BancorpSouth, Inc.
Headquarters: Tupelo, MS
Board Representation: 4 Additional Directors from First United (Total of 13)
Executive Management: Aubrey B. Patterson, Chairman & CEO
James V. Kelley, President & COO
L. Nash Allen Jr., CFO
(1) Based on BancorpSouth share price of $16.00 as of April 14, 2000
(2) Based on 25.6 million fully diluted First United shares outstanding as of
December 31, 1999
(3) Based on First United price of $12.625 on April 14, 2000
2
5
Key Structural Terms
Transaction Structure: Pooling-of-interests
Tax-free exchange of shares
Ownership Split: 66.8% BXS / 33.2% UNTD
Lock-up Option: Cross lock-ups of 19.9%, struck at market
Expected Closing: 3Q 2000
Expected Merger-Related Charges: $31 M pre-tax, $20 M after-tax
Due Diligence: Pre-signing - Week of April 10, 2000
Post-signing - Completed by May 8, 2000
Required Approvals: Regulatory:
- Federal Reserve
- FDIC
- OCC
- States of Mississippi, Arkansas, Louisiana & Texas
BancorpSouth and First United Shareholders
3
6
FIRST UNITED BANCSHARES, INC.
- First United Bancshares, Inc. is a multi-bank holding company
that operates 11 subsidiary banks and 1
- 62 branches throughout Arkansas, Northern Louisiana and
Eastern Texas
- At December 31, 1999, First United had total consolidated
assets of $2.7 billion, loans of $1.5 billion,
- Today announced 1st-Quarter 2000 earnings of $0.34 per share,
a 6.3% increase over 1st-Quarter 1999
4
7
TRANSACTION RATIONALE
- - Entry into Attractive New Markets
- - Leveraging First United's Branch Network
- - Strong Management Additions
- - Fairly Priced Transaction
- - Financially Attractive
- - History of Successful Merger Integration and Customer Retention
- - Exciting Opportunity
5
8
BUILDING A SIX STATE REGIONAL PLATFORM
[MAP]
Pro Forma Deposits by State
State Deposits % of Total
-------- ----------
Mississippi $3,367 48.2%
Arkansas 1,520 21.8
Tennessee 825 11.8
Alabama 525 7.5
Texas 486 7.0
Louisiana 256 3.7
------ -----
Total: $6,979 100.0%
====== =====
MORE THAN HALF OF PRO FORMA DEPOSITS OUTSIDE HOME STATE
SOURCE: SNL SECURITIES; DATA AS OF JUNE 30, 1999.
6
9
ENTRY INTO ATTRACTIVE NEW MARKETS
DIVERSIFIED, GROWING MARKETS WITH AVERAGE MEDIAN INCOME GROWTH
RATES ABOVE THE NATIONAL AVERAGE OF 12.2%
MARKET
SHARE MEDIAN INCOME
DEPOSITS RANK GROWTH RATE (2) MAJOR INDUSTRIES
-------- ------ --------------- ----------------
Tupelo, MS(1) $433.4 1 24.2% Mfg./Healthcare
Hattiesburg, MS 408.4 1 14.0 Education/Healthcare
Jackson, TN 288.1 1 18.7 Mfg./Retail Services
Fort Smith, AR-OK 469.3 2 13.1 Healthcare/Light Mfg.
Jackson, MS 486.6 3 16.4 Telecom/Government
Biloxi-Gulfport, MS 255.8 4 15.4 Tourism/Military
Memphis, TN-AR-MS 488.0 6 15.3 Distribution Center
Shreveport-Bossier City, LA 104.8 6 14.8 Tourism/Energy
Monroe, LA 74.3 6 12.4 Agriculture/Education
Birmingham, AL 206.3 11 15.9 Manufacturing
(1) City of Tupelo and surrounding counties
(2) Source: SNL Branch Migration; growth rates span 2000-2004
7
10
CHANGING THE REGIONAL COMPETITIVE LANDSCAPE
MARKET MARKET
RANK INSTITUTION DEPOSITS BRANCHES SHARE CAPITALIZATION(1)(1)
----------- -------- -------- ------ --------------------
1 Regions $11,556 293 6.4%. $ 4,563
2 AmSouth 9,559 257 5.3. 5,708
3 Union Planters 8,149 307 4.5. 3,859
- -----------------------------------------------------------------------------------------------
4 BXS/UNTD PRO FORMA 6,979 229 3.9. 1,375
- -----------------------------------------------------------------------------------------------
4 First Tennessee 6,971 71 3.9. 2,395
5 SouthTrust 6,712 94 3.7. 4,164
6 BANCORPSOUTH 4,717 167 2.6. 915
7 Bank of America 4,209 101 2.3. 83,138
8 Trustmark 3,848 139 2.1. 1,253
9 Hibernia 3,122 80 1.7. 1,642
10 National Commerce 2,841 46 1.6. 1,920
12 FIRST UNITED BANCSHARES 2,262 62 1.3. 323
N.B. Region defined as pro forma MSA's of BancorpSouth and First United
(1) Fully diluted market capitalizations as of April 14, 2000
Source: SNL Branch Migration data as of June 30, 1999
8
11
LEVERAGING FIRST UNITED'S BRANCH NETWORK
- - Expanded product offerings for all First United customers:
- Commercial Insurance
- Life Insurance
- Trust and Brokerage
- Mortgage Banking
- Credit & Debit Cards
- Leasing
- Cash Management
- Student Loans
- - Successful implementation of STAR sales and service process into First
United markets
- - First United low cost funding (20 bps advantage vs. BancorpSouth) used
to support loan growth throughout BancorpSouth existing markets
9
12
APPLYING FIRST UNITED'S EXCESS LIQUIDITY & CAPITAL
- - Redeployment of excess liquidity into higher-yielding assets
- First United has AFS securities of $729 million, yielding
6.21%
- First United has a loan to deposit ratio of 66.1%
- - Pick-up in BancorpSouth capital ratios can be leveraged in future
purchase accounting acquisitions or balance sheet growth
BancorpSouth Pro Forma Pick-Up
------------ --------- -------
Leverage Ratio 8.34% 8.76% 42 bps
Total Capital Ratio 12.80 13.67 87
Tier 1 Capital Ratio 11.49 12.70 121
10
13
STRONG MANAGEMENT ADDITIONS
- - James V. Kelley, 50
- First United CEO since 1985
- President and COO of the combined company
- Executive management expertise
- - Regional chairmen from First United:
- John Robert Graves South Arkansas Region
- Jim Harwood North and West Arkansas Region
- Gordon Lewis Texas and Louisiana Region
- - Knowledge of local markets
- - Help facilitate transition and retention of customers
11
14
FAIRLY PRICED TRANSACTION
TRANSACTION COMPARABLE TRANSACTION/
MULTIPLES MEDIAN COMPARABLES
Price as Multiple of:
LTM Normalized EPS(1) 13.6x 14.7x 93%
Forward EPS(2) 12.9 13.4 96
Forward+1 EPS(2) 12.0 12.2 98
Book Value(1)(3) 1.74x 2.09x 83
Tangible Book Value(1)(3) 1.85 2.39 77
Premium to Deposits(1)(3) 9.4% 15.0% 63
Premium to Market(4) 42.6 27.2 157
Note: Transactions include WFC / FSCO, NCBC / CCB and BBT / OV
(1) Based on First United financial results for the year ended December 31,
1999
(2) Earnings based on median IBES estimates as of April 14, 2000
(3) Book value includes the exercise of options
(4) Based on First United price of $12.625 on April 14, 2000
12
15
RESTRUCTURING AND MERGER RELATED CHARGES
(Dollars in 000's, except per share amounts)
PROJECTED
---------
AFTER TAX ESTIMATES 2000 2001
- ------------------- ------- ------
Legal, Accounting & Consulting $ 3,525 --
Data Processing Write-Offs and Charges 1,400 2,935
Change of Control, Retention & Other 2,975 465
Recognition of Loss on Sale of Securities 12,400 --
Total Charges $20,300 $ 3,400
13
16
EARNINGS ACCRETIVE
(Dollars in 000's, except per share amounts)
PROJECTED
---------
NET INCOME (AFTER TAX ESTIMATES) 2000 2001
- -------------------------------- ------- ------
BancorpSouth Stand-alone (1) $ 83,000 $ 90,400
First United (1) 38,000 41,200
-------- --------
Pro Forma Combined Income $121,000 $131,600
Net Cost Savings 860 3,900
Increased Spread on AFS Securities (2) 2,200 2,200
Shift from HTM Securities to Loans(3) 850 1,700
Other Fee Income 600 1,100
-------- --------
Pro Forma Operating Income $125,510 $140,500
-------- --------
Operating EPS Stand-alone (1) $ 1.45 $ 1.58
Operating EPS Pro Forma (4) 1.46 1.64
% Accretion/(Dilution) 0.9% 3.8%
(1) Based on IBES estimates as of April 14, 2000 for both BancorpSouth and
First United; 2002 earnings based on IBES long-term growth rate of 9.0%
for BancorpSouth and 8.6% for First United
(2) Assumes $600 million of First United AFS securities portfolio is sold
and redeployed at a 60 bps pre-tax gain in yield
(3) Assumes gradual shift from HTM portfolio to loans totaling $240 million
by end of year 2002 at a 160 bps pre-tax gain in yield
(4) Based on a pro forma fully diluted average shares outstanding of 86.0
million
14
17
HISTORY OF SUCCESSFUL MERGER INTEGRATION
AND CUSTOMER RETENTION
================================================================================
Current / Current /
Beginning Beginning
Deposits(1) Deposits(1)
1998 1995
- ---- ----
HomeBanc Corp. AL Wes-Tenn Bancorp TN
The First Corp. AL Shelby Bank TN 111.8%
Alabama Bancorp AL 105.6% First Federal Bank MS
Merchants Capital MS
1994
----
1997 LF Bancorp MS
- ----
Iuka Guaranty Bank MS 98.2%
1992
Volunteer Bancshares TN
In 1997, BancorpSouth successfully completed a charter consolidation process
(1) From announcement date to present
15
18
AN EXCITING OPPORTUNITY
================================================================================
- Entry into Attractive New Markets
- Leveraging First United's Branch Network
- Strong Management Additions
- Fairly Priced Transaction
- Financially Attractive
- History of Successful Merger Integration and Customer
Retention
EXCITING OPPORTUNITY FOR BANCORPSOUTH AND
FIRST UNITED SHAREHOLDERS
16
19
APPENDIX
SUPPLEMENT FINANCIAL INFORMATION
20
PRO FORMA BALANCE SHEET
(Dollars in millions; data at Decembert 31, 1999)
BXS UNTD PRO FORMA
Cash & Equivalents $ 223 $ 118 $ 341
Securities 1,186 976 2,162
Gross Loans 4,054 1,488 5,542
Allowance for Loan Losses (56) (19) (74)
Intangibles & Other Assets 370 102 471
Total Assets $ 5,777 $ 2,666 $ 8,443
Deposits $ 4,815 $ 2,252 $ 7,067
Other Liabilities 464 155 619
Total Equity 497 260 757
Total Liabilities & Equity $ 5,777 $ 2,666 $ 8,443
KEY RATIOS:
Tier 1 Capital 11.49% 15.81% 12.70
Total Capital 12.80 15.92 13.67
Tangible Common 8.40 9.20 8.65
Tier 1 Leverage 8.34 9.67 8.76
18
21
PRO FORMA INCOME STATEMENT
(Dollars in millions; for the year ended December 31, 1999; no cost savings
assumed)
BXS UNTD PRO FORMA
----- ----- ---------
Net interest income after provision $ 203 $ 102 $ 305
Non-interest income 79 20 99
----- ----- -----
Total revenue (1) 282 122 404
Non-interest expense (178) (68) (245)
Other expense (5) (1) (6)
----- ----- -----
Pre-tax income 99 52 151
Tax Expense (30) (19) (49)
----- ----- -----
Net income $ 69 $ 33 $ 102
===== ===== =====
Key Ratios:
ROAA 1.26% 1.29% 1.26%
ROACE 14.7 12.7 13.9
Net interest margin 4.28 4.39 4.32
Efficiency ratio 60.7 54.6 58.9
Non-interest income/revenue 25.7 15.6 22.7
(1) Net of provision for loan losses
19
22
PRO FORMA LOAN & DEPOSIT COMPOSITION
------------------ ------------------ ------------------
BXS UNTD PRO FORMA
------------ -------------- -------------
$ % $ % $ %
------------------ ------------------ ------------------
GROSS LOANS
Commercial & Agriculture $ 371 9.0% $ 341 22.9% $ 712 12.7%
Commercial Real Estate 1,408 34.1 492 32.9 1,900 33.8
Consumer & Installment 978 23.7 219 14.7 1,197 21.3
Residential Real Estate 1,043 25.3 437 29.3 1,480 26.3
Lease Financing & Other 331 8.0 4 0.3 335 6.0
DEPOSITS
Demand:
Interest Bearing $1,075 22.3% $ 485 21.5% $1,560 22.1%
Non-Interest Bearing 615 12.8 352 15.6 967 13.7
Savings 800 16.6 138 6.1 938 13.3
Time Deposit 2,326 48.3 1,277 56.7 3,603 51.0
N.B. Financial data as of December 31, 1999
20
23
PRO FORMA ASSET QUALITY
(Dollars in thousands; financial data at December 31, 1999)
BXS UNTD PRO FORMA
------- ------- ---------
Non-accrual loans $ 5,150 $ 8,202 $13,352
Restructured loans 91 1,034 1,125
Loans 90+ days past due 14,378 2,933 17,311
------- ------- -------
Non-performing loans 19,619 12,169 31,788
Other real estate owned 7,764 3,418 11,182
------- ------- -------
Non-performing assets $27,383 $15,587 $42,970
======= ======= =======
KEY RATIOS:
Non-performing loans / loans 0.48% 0.82% 0.57%
Non-performing assets / assets 0.47 0.58 0.51
Allowance / NPL's 2.84x 1.54x 2.34x
Allowance / NPA's 2.03 1.20 1.73
N.B. Financial data as of December 31, 1999
21
24
FIRST UNITED HISTORICAL FINANCIALS
1997 1998 1999 CAGR
---------- ---------- ---------- -----
Income Statement:
Net interest income $ 90.7 $ 94.4 $ 104.9 7.6%
Provision for losses 5.2 3.2 3.1 NM
Non-interest income (1) 18.1 17.8 19.4 3.7
Non-interest expense 68.0 65.3 67.9 NM
Net income $ 25.8 $ 30.3 $ 33.5 13.9%
Balance Sheet:
Total assets $ 2,355.3 $ 2,516.5 $ 2,666.0 6.4%
Loans(2) 1,213.3 1,353.2 1,488.4 10.8
Deposits 1,990.2 2,134.0 2,251.6 6.4
Shareholders' equity 234.5 255.6 259.7 5.2
(1) Excludes securities gains
(2) Net of unearned income
22
25
BANCORP SOUTH Q1 2000 INCOME STATEMENT
------------- ------------- ---------------
THREE MONTHS THREE MONTHS
ENDED 3/31/00 ENDED 3/31/99 PERCENT CHANGE
------------- ------------- ---------------
Net interest income after provision $ 52.4 $ 49.3 6.3%
Non-interest income 21.5 20.1 7.0
-------- --------
Total revenue (1) 73.9 69.4 6.5
Non-interest expense (46.6) (46.9) 0.6
-------- --------
Pre-tax income 27.3 22.5 21.3
Tax expense (9.2) (6.2) (48.4)
-------- --------
Net income $ 18.2 $ 16.3 11.7
======== ========
Diluted EPS $ 0.32 $ 0.29 10.3
KEY RATIOS:
ROAA (2) 1.25% 1.25%
ROACE (2) 14.7 14.4
Net interest margin (2) 4.21 4.29
Efficiency ratio 60.3 64.7
Non-interest income/revenue (1) 29.1 29.0
(1) Net of provision for loan losses
(2) Annualized
23
26
FIRST UNITED Q1 2000 INCOME STATEMENT
------------- ------------- ---------------
THREE MONTHS THREE MONTHS
ENDED 3/31/00 ENDED 3/31/99 PERCENT CHANGE
------------- ------------- ---------------
Net interest income after provision $ 24.5 $ 23.6 3.8%
Non-interest income 5.0 4.8 4.2
-------- --------
Total revenue (1) 29.5 28.4 3.9
Non-interest expense (17.6) (16.7) (5.4)
-------- --------
Pre-tax income 11.9 11.7 1.7
Tax expense (3.4) (3.6) 5.6
-------- --------
Net income $ 8.5 $ 8.1 4.9
======== ========
Diluted EPS $ 0.34 $ 0.32 6.3
KEY RATIOS:
ROAA (2 1.30% 1.29%
ROACE (2) 13.0 12.7
Net interest margin (2) 4.32 4.40
Efficiency ratio 57.1 57.3
Non-interest income/revenue (1) 20.4 16.9
(1) Net of provision for loan losses
(2) Annualized
24