Servicing Impairment Hits BancorpSouth

BancorpSouth, Tupelo, Miss., saw its earnings trimmed by a $16.3 million writedown in the value of its mortgage servicing rights during the fourth quarter. The bank valued its MSRs at $25 million, or 82 basis points of the outstanding balance. On the bright side, BancorpSouth said mortgage lending revenue, excluding the servicing impairment, rose 20% from the prior year period to $4.1 million during the fourth quarter. CEO Aubrey Patterson said that despite MSR impairment, the sharp drop in interest rates during the fourth quarter presents an ongoing opportunity to increase mortgage lending revenue through refinancing and home purchase originations. The servicing hit and smaller writedowns to investment securities trimmed earnings-per-share by 18 cents. The bank reported EPS of $0.20 for the fourth quarter.