Company: RNST
Filing Date: 2025-05-08
Form Type: 10-Q
Source: 0000715072-25-000180
Chunk: 78

Company: RENASANT CORP
Filing Date: 2025-05-08
Form: 10-Q
Item: Item 1
Chunk 78
---
 lives as determined at acquisition. These finite-lived intangible assets have remaining estimated useful lives ranging from approximately 1 year to 6 years.

Communication expenses, those expenses incurred for communication to clients and between employees, were $2,033 for the first quarter of 2025 as compared to $2,024 for the same period in 2024.

Other noninterest expense includes business development and travel expenses, other discretionary expenses, loan fees expense and other miscellaneous fees and operating expenses. Other noninterest expense was $14,379 for the three months ended March 31, 2025 as compared to $14,669 for the same period in 2024.

Efficiency Ratio

Three Months Ended March 31,2025 2024Efficiency ratio65.53 %67.52 %

The efficiency ratio is a measure of productivity in the banking industry. (This ratio is a measure of our ability to turn expenses into revenue. That is, the ratio is designed to reflect the percentage of one dollar that we must expend to generate a dollar of revenue.) The Company calculates this ratio by dividing noninterest expense by the sum of net interest income on a fully tax equivalent basis and noninterest income. The improvement in our efficiency ratio for the three months ended March 31, 2025 as compared to the same period in 2024 was driven by the increase in our net interest income and is a reflection of our commitment to aggressively manage our costs within the framework of our business model. Our goal is to improve the 

51

efficiency ratio over time from currently reported levels as a result of revenue growth while at the same time controlling noninterest expenses.

Income Taxes

Income tax expense for the first quarter of 2025 and 2024 was $10,448 and $9,912, respectively. The increase in income tax expense is primarily due to the increase in pre-tax income, partially offset by an increase in the generation of certain federal tax credits.

Risk Management

The management of risk is an on-going process. Primary risks that are associated with the Company include credit, interest rate and liquidity risk. Credit risk and interest rate risk are discussed below, while liquidity risk is discussed in the next subsection under the heading “Liquidity and Capital Resources.”

Credit Risk and Allowance for Credit Losses on Loans and Unfunded Commitments

Management of Credit Risk – Roles and Responsibilities.  Inherent in any lending activity is credit risk related to asset quality deterioration and its impact on capital should a borrower default. Credit risk