Executive Summary

Q3 2024 EPS of $0.59 declined 5% QoQ and 23% YoY; operating EPS rose to $0.65 on modest core profitability improvement while reported EPS reflected $2.6M in merger-related charges .
Net interest margin expanded 7 bps QoQ to 3.33% (core NIM +7 bps to 3.26%), aided by higher loan yields; average cost of deposits rose 5 bps to 1.83% .
Loans grew $67.7M (+1.3% QoQ; +4.5% YoY); deposits declined $65.4M QoQ (NIB mix down to 27.4%); credit costs remained modest (NCOs 0.03% annualized) as NPAs edged up to 0.31% of assets .
Company reiterated all‑stock merger with Renasant (1.00 RNST share for each FBMS share), boards and shareholders approved; closing targeted H1 2025; $0.25 dividend declared for payment Nov 22, 2024 .
Consensus estimates from S&P Global were unavailable via our tool this quarter; we therefore do not characterize a beat/miss versus Street expectations (see Estimates Context).

What Went Well and What Went Wrong

What Went Well
- NIM inflected higher: NIM +7 bps QoQ to 3.33%; core NIM +7 bps to 3.26% on better asset yields, partially offset by funding costs .
- Loan growth and stable credit: Loans +$67.7M QoQ; annualized NCOs 0.03% with ACL/loans steady at 1.05% .
- Securities marks improved: Net unrealized loss on the portfolio declined to $91.6M from $129.0M QoQ (and from $184.9M YoY), improving tangible book trajectory .
- CEO tone confident on merger synergy and franchise: “Together we create a high performing southeastern franchise…” citing margin expansion and core operating earnings growth .
What Went Wrong
- EPS down YoY and QoQ: Reported EPS fell to $0.59 (vs $0.62 in Q2 and $0.77 in Q3’23) as noninterest income softened and merger costs lifted expenses .
- Funding pressures persisted: Average cost of deposits rose to 1.83% (from 1.78%); NIB mix fell to 27.4% from 28.2% QoQ; total deposits down $65.4M QoQ .
- NPAs ticked up: Nonperforming assets/total assets increased to 0.31% (from 0.26% in Q2), with nonaccrual loans up QoQ .

Financial Results

Income statement and profitability (USD millions except per-share and ratios)

Metric	Q3 2023	Q2 2024	Q3 2024
Total Interest Income	$85.681	$91.027	$93.561
Net Interest Income	$60.704	$57.794	$59.014
Non-interest Income	$19.324	$13.319	$12.242
Provision for Credit Losses	$1.000	$1.650	$1.000
Non-interest Expense	$47.724	$44.089	$46.394
Net Income (to common)	$24.360	$19.697	$18.571
Diluted EPS ($)	$0.77	$0.62	$0.59
Diluted EPS, Operating ($)	$0.76	$0.63	$0.65
NIM (%)	3.47%	3.26%	3.33%
Core NIM (%)	3.27%	3.19%	3.26%
ROA (Annualized)	1.24%	0.99%	0.94%
Efficiency Ratio (GAAP)	58.90%	61.14%	64.22%
Cost of Deposits (Avg)	1.21%	1.78%	1.83%

Balance sheet and capital

Metric	Q3 2023	Q2 2024	Q3 2024
Total Assets ($B)	$7.884	$7.966	$7.966
Total Loans ($B)	$5.090	$5.251	$5.319
Total Deposits ($B)	$6.480	$6.626	$6.561
NIB Deposits (% of total)	30.4%	28.2%	27.4%
Investment Securities ($B)	$1.836	$1.771	$1.715
CET1 Ratio (%)	12.0%	12.4%	12.5%*
TCE Ratio (%)	7.3%	8.3%	8.9%
NPAs / Assets (%)	0.28%	0.26%	0.31%
ACL / Loans (%)	1.05%	1.05%	1.05%
Annualized NCOs / Loans (%)	0.004%	0.036%	0.033%
Dividend per Share ($)	$0.23	$0.25	$0.25

*estimated

Loan mix (% of total loans)

Category	Q3 2023	Q2 2024	Q3 2024
Commercial, Financial & Ag	14.8%	13.5%	13.5%
CRE (Commercial Real Estate)	45.5%	46.4%	46.4%
Residential Real Estate	25.5%	26.4%	26.9%
Construction (in RE categories above)	12.4%	12.2%	11.8%
Consumer	1.1%	0.9%	0.8%

Key balance sheet/credit KPIs

KPI	Q3 2023	Q2 2024	Q3 2024
Avg Yield on Earning Assets	4.90%	5.14%	5.27%
Cost of Int.-Bearing Liabilities	2.05%	2.62%	2.72%
FTE NIM	3.52%	3.32%	3.38%
Operating Efficiency Ratio	56.06%	60.65%	60.63%
ROATCE, Operating	17.17%	12.76%	12.82%

Non-GAAP adjustments commentary: Q3 included $2.592M of acquisition and charter conversion charges; operating EPS was $0.65 vs GAAP $0.59, with reconciliations provided in the release .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Operating Expense run-rate	FY 2024 (from Q2 call)	~$44M per quarter expected in 2H24	Q3 actual $46.4M (merger-related charges elevated); no new guidance update in Q3 materials	—
Net Interest Margin	2H 2024 (from Q2 call)	“Relatively stable/flattish” vs Q2, small puts/takes	No explicit Q3 update; NIM +7 bps QoQ in Q3	Maintained commentary (actual better)
Dividend	Q4 2024	Prior quarterly $0.25	$0.25 payable Nov 22, 2024 (record Nov 8)	Maintained
Strategic/M&A	Close timing	—	Renasant merger targeted H1 2025; approvals obtained; regulatory approvals pending	New (July announcement), reiterated

No explicit revenue/earnings guidance was provided in Q3 materials .

Earnings Call Themes & Trends

Note: A Q3 2024 earnings call transcript was not available in our document set; we use the Q3 press release/10‑Q for “Current Period” and Q2/Q1 calls for “Previous Mentions”.

Topic	Previous Mentions (Q1–Q2 2024)	Current Period (Q3 2024)	Trend
NIM and core NIM	Q1: Core NIM down 4 bps, stabilization hoped mid‑year . Q2: Core NIM +9 bps; outlook “flattish” 2H .	NIM +7 bps to 3.33%; core NIM +7 bps to 3.26% .	Improving QoQ
Deposit costs / mix	Q1: Cost of deposits up to 1.78%; competitive specials; NIB 27.4% tied to public funds inflows . Q2: Cost at 1.78%; pressures easing somewhat .	Cost rose to 1.83%; NIB fell to 27.4%; deposits −$65M QoQ .	Slight pressure
Loan growth / pipeline	Q1: Pipelines up ~50%; remix from securities . Q2: +$111M loans; guidance mid‑single‑digit growth .	Loans +$67.7M QoQ (+1.3%); +4.5% YoY .	Healthy
Securities strategy / marks	Q1: Evaluating another restructuring; prior reposition aided yields .	AFS/HTM fair value improvement; net unrealized loss to $91.6M (from $129.0M) .	Improving
Asset quality / office exposure	Q1: Office exposure granular; low delinquencies; stress testing (300 bps) . Q2: NPAs 0.26%; NCOs 0.04% .	NPAs 0.31%; NCOs 0.03%; ACL/loans 1.05% .	Stable to slightly weaker
Expenses / efficiency	Q1: OpEx discipline; FY guide ~$176–177M . Q2: ~ $44M per qtr in 2H .	Q3 OpEx $46.4M including $2.6M merger charges; operating efficiency 60.63% .	Temporarily higher (merger costs)
M&A / Merger	Q2: Active conversations pre‑deal .	Renasant merger announced July; boards & shareholders approved; H1’25 close targeted .	Strategic pivot

Management Commentary

CEO (Hoppy Cole): “The quarter was characterized by continued strong performance in terms of profitability and growth. Loans increased… core operating earnings increased 2.7% quarter over quarter and our margin expanded six basis points… We look forward to the opportunities… through this strategic partnership with Renasant.”
Release highlights emphasized QoQ core earnings growth (+2.7%), NIM and core NIM expansion, and maintained ACL coverage despite modest uptick in NPAs .

Q&A Highlights

The Q3 2024 earnings call transcript was not available in our dataset. For context from Q2:
- Margin outlook “relatively stable” with puts/takes from brokered CDs, public funds runoff and asset yields .
- Loan growth expected mid‑single digits in 2H; pipelines strong .
- Expense run-rate guided to ~$44M per quarter in 2H .
- Potential for additional securities restructuring evaluated opportunistically .

Estimates Context

We attempted to retrieve S&P Global consensus EPS and revenue for Q3 2024, but the company mapping was unavailable via our tool at this time; therefore, we cannot compare results to Street consensus for this quarter. If you want, we can source consensus externally or refresh when the mapping is updated.

Key Takeaways for Investors

Core earnings quality improved sequentially (operating EPS up; core NIM higher), suggesting underlying spread momentum even as funding costs remain elevated .
Funding remains the key swing factor: deposit costs rose and NIB mix slipped; watch competitive pricing and public funds seasonality into Q4 .
Credit remains benign with low NCOs and stable ACL coverage; NPAs ticked up but remain modest relative to assets and capital .
Securities mark improvement supports tangible capital and optionality for future repositioning; continued runoff at low yields to help remix .
The Renasant all‑stock merger is the central medium‑term catalyst, offering scale, cost synergies, and a broader Southeast footprint; closing targeted H1 2025 subject to regulatory approvals .
Near-term trading: stock narrative hinges on sustaining NIM expansion and stable credit while limiting funding cost creep; merger milestones and regulatory progress could drive sentiment .
Medium-term thesis: a combined platform with improved efficiency and balance sheet mix should enhance returns through the cycle; execution on integration and deposit franchise resiliency are the watch items .

Sources: Q3 2024 8‑K press release and exhibits –; Q3 2024 10‑Q –; Q2 2024 earnings call transcript –; Q1 2024 earnings call transcript –.

FIRST BANCSHARES INC /MS/ (FBMS)·Q3 2024 Earnings Summary