Good day ladies and gentlemen and welcome to the Renasant Corporation quarter first 2008 earnings conference call. (Operator Instructions) As a reminder this conference is being recorded for replay purposes. I would now like to turn the presentation over to your host for today’s conference, Mr. Robinson McGraw, Chairman and CEO of Renasant Corporation. You may proceed sir.

Good morning everyone and thank you for joining us for Renasant Corporation’s first quarter 2008 earnings conference call. With me today are Jim Gray, Chief Information Officer, Stuart Johnson, Chief Financial Officer, Harold Livingston, Chief Credit Officer and C.H. Springfield, Chief Credit Policy Officer, Mitch Waycaster, Chief Administrative Officer and Kevin Chapman, Chief Accounting Officer. Before we begin let me remind you that some of our comments during this call may be forward-looking statements which involve risk and uncertainty. A number of factors could cause actual results to differ materially from the anticipated results or the expectations expressed in the forward-looking statements. Those factors include but are not limited to interest rate fluctuation, regulatory changes, portfolio performance and other factors discussed in our recent filings with the Securities & Exchange Commission. We undertake 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. During the first quarter of 2008 we believe that our financial results reflect our ability to meet the challenges offered in the current economic environment. Although the Federal Reserved reduced the federal funds target rate 200 basis points during the first quarter of 2008 we experienced only a slight compression in our core net interest margin. Additionally, our mortgage lending division grew non-interest income on record mortgage loan volumes even when mortgage originations declined nationally. In looking into our tri-state markets it’s been over seven months since we integrated Capital Bancorp of Nashville Tennessee in to our systems. With the merger and successful conversion now behind us Nashville looks to be a strong growth market for years to come. While there’s been a definitely slowdown in Nashville housing market we believe that it’s diverse economy and its lack of dependency on any…

Please stand by for our first question. Our first question comes from the line of Barry McCarver. You may proceed sir. Barry McCarver – Stephens, Inc.: Robin, my first question is I wonder if you could touch a little bit on what gross loan production looked like in the quarter since period end loans were basically flat? And, at the same time, talk a little bit about what the pricing for loans look like in 1Q?

First quarter gross production was about $114 to $115 million. Obviously, we had pay downs. From a positive standpoint we saw our construction and development loans decrease by about $7 million during the quarter net. From a pricing standpoint maybe let Stuart give you an answer to that on both sides of the ledger.

Okay. We’re seeing merely on the loan side processing in the neighborhood of probably depending on the credit the 575, on probably the good credit maybe around 575. Barry McCarver – Stephens, Inc.: So relative to 4Q has that improved any at all?

No. Barry McCarver – Stephens, Inc.: Okay. Then, on the other side of the balance sheet I was wondering if you could talk a little about the pretty strong deposit growth in the quarter, what you’re seeing on money market, CD rates in some of your markets? At the same time it looks like you used some of that excess funding to move in to some securities?

That’s correct Barry. We’re seeing very aggressive pricing in some of our markets so what we have made a determination to do is basically to maintain our core relationships and hot money, especially hot money that goes out for any period of time to utilize wholesale funding, mainly home loan buying money as a replacement for that money we felt like – obviously hot money will recycle and we’ll take another look at it as it comes back up in the future. But, we’re seeing some rather significant rates being paid in some of our markets. We’ve been pretty aggressive in our pricing as evidenced by our margin being basically flat and obviously a part of that was due to the fact that we had that huge 125 basis point drop that took us a while to catch up but we’ve basically at a breakeven point at this stage of the game in that pricing scenario on both sides of the ledger. We are seeing some very aggressive pricing in our markets, especially the Memphis market, to some degree the Nashville and Birmingham markets. Barry McCarver – Stephens, Inc.: Just to make sure I understand the working parts of the margin there then, could you give us maybe the monthly margin or at least give us some sense to where you feel like you are in bringing those deposit rates down? Obviously, I’m thinking about the margin 2Q and going forward?

We basically have – and I don’t have – Stuart has the monthly in front of him Barry.

Barry, what we’re doing on our margin right now certainly you go back and look at the quarter we’re down total about 44 basis points on our total liability processing, 79 basis points on our debt but we did bring our deposits down by 37 basis points. So, we continue to work off the deposit side and bringing those rates down with the quarterly margin pretty close to what we were doing on the last month if you put 03-3 in there. We’re running about a core of 340, 345, and 346. Barry McCarver – Stephens, Inc.: Okay. Then last question Robin, I was looking at non-accrual loans are up a couple of million bucks and it looked like foreclosed assets came up a couple of million, can you tell us what those were?

Let me give you a little color on that. Actually, following month end we have or are in the process of seeing about a 19 basis point drop in the non-performing loans. We have about $2.4 million of loans – well, $1.8 has already been paid off and we have additional loans with a total of the already paid off and those to be brought current are at $2.4 million level or about 19 basis points off that 85. Non-performing assets we have contracts to sell about $3.4 million of the non-performing assets at this point in time. So, these were just the things that didn’t occur before month end that should have that ran those up. In addition to that, of our 90 day past due loans first I mentioned a while ago that non-accruals were $2.4 million are turning around and then of 90 day past due we said another $1.6 million are in the process of being brought current and we should see another $1 million loan brought current prior to month end based on what we see so I think there will be a substantial reduction in that during the month of April.

Your next question comes from the line of Brian Klock from KBW. You may proceed sir. Brian Klock – Keefe, Bruyette & Woods: Robin, can you give us a little more color on the net charge offs, the $1.79 in the quarter by loan type and geography?

Brian, a substantial portion of that was the conclusion of the Birmingham loan that we’ve been talking about for a while. That was close to half of what that total was. In addition to that, we had about another $700,000 in Mississippi plus the Alabama loan that I mentioned which was the major portion of what we had. Brian Klock – Keefe, Bruyette & Woods: The loan in Mississippi was that a construction loan or C&I loan?

They were construction type loans I think mainly. Brian Klock – Keefe, Bruyette & Woods: Okay. I guess just to follow up on just to make sure I’ve got all the math correct, from Barry’s question in the second quarter you’ve mentioned that there’s $2.4 million of NPLs that you expect to be cleared out in the second quarter?

Let me go back and tell you what – non-accrual loans we have about $2.4 million that have already either cleared up or will this month. We have about $1.6 million of 90 day past dues that either have or will this month with another potential of $1 million that should clear up this month, that we think will clear up this month. Brian Klock – Keefe, Bruyette & Woods: So, I guess if all goes well the $16.1 million of non-performers that were there at the end of the first quarter that should go down by $2.4 million and the past due that was $5.9 could go down by $2.6 million?

Of total non-performers that includes non-accrual and 90 day past dues, that would be about $5 million; $4 million with the potential of being $5 million. Now, that’s during this month and that doesn’t account for anything that could come up and I’m not making predictions on that over the course of this month but right now that’s what we see at this stage of the game. Brian Klock – Keefe, Bruyette & Woods: But, the $2.4 that’s not relieving anything out of the REO it’s just –

No. The REO we’re looking at a potential of $3.4 million coming off of that based on contracts we have assuming the contracts close which we don’t anticipate that they won’t, another $3.4 million. Brian Klock – Keefe, Bruyette & Woods: Okay. Then maybe Stuart if you can give us a little color within the gain on sale of mortgage loans? I know Robin you mentioned it was a strong record production quarter. Can you give us the gain on sale margin and value of loans sold?

Jim is going to answer that, mortgage lending falls under him.

Margins typically run on wholesale volume of about half to five eighths and then on our retail volume is running probably about 1 to 1.25. Brian Klock – Keefe, Bruyette & Woods: I guess within the other operating items there anything non-recurring other than what you’ve already broken out with the Visa gains and the other fee income?

On the income side? Brian Klock – Keefe, Bruyette & Woods: On the income side.

No, nothing else on the income side other than the 03-3 and the Visa gains. Brian Klock – Keefe, Bruyette & Woods: The Visa gain.

One of the things we do and it’s a timing is we do have our contingency income that we recognize from an insurance agency during the first quarter that we will not typically get in the second, third and fourth quarter. Brian Klock – Keefe, Bruyette & Woods: And how much is that typically Stuart?

That’s around approximately a couple of hundred thousand. Brian Klock – Keefe, Bruyette & Woods: Robin, earlier you mentioned the moves in Birmingham to the Park Place Tower, were there any costs in the first quarter related to that? Or, are those costs going to be more in to the third quarter when you said the move will actually take place?

Actually Brian those costs, any expenses we have will be minimal and it will only relate basically to a small portion of the improvements. Most of the improvements were done by the landlord. We have a little that will have very little impact on the expense side. On the other side of the ledger though, we actually will end up with a reduction in rental expense as a result of this move. We consolidated multiple locations, our mortgage loan back office was in one location, our mortgage loan production office was in another location, we had two floors in the same building but two separate rental situations for relationship managers and plus our executive offices plus the Watts Tower downtown retail space. We combined all of those into this one building and actually there were some slight efficiencies which would offset any expense involved in this move. That includes the signage rights on the building so there will not be any uptick in expenses as a result of it. Brian Klock – Keefe, Bruyette & Woods: Great. Last question and I’ll let someone else jump on in, in the [inaudible] invested expenses how much of that is sort of seasonal first quarter FICO [inaudible]?

Let me go back. If you’re looking at a link quarter basis Brian, and I think we mentioned this last quarter, our salary expense last quarter declined I think about $240,000. That was adjustments in incentives based on what had been approved prior to year end and our not entirely hitting targets. Therefore, in the fourth quarter we saw a $240,000 decline in that. This quarter as obvious from the mortgage quarter that they had you saw incentive expenses go up as a result of that because of the outstanding quarter they had. So, the mortgage originators incentive picked up as a result of that. Also, if we look on a linked quarter basis, and we mentioned this last quarter, we have $300,000 credit on our core processing bill that had an impact on the fourth quarter and in addition to that this quarter we had some expenses, legal expenses and taxes, we have to pay taxes on other real estate and some of those items that cropped up during the first quarter this year. Plus, as you know the FDIC everybody’s pretty much exhausted their credit that they had and therefore we had to start accruing for a higher amount for our FDIC premiums. So, those are where we saw some changes from the fourth quarter of last year. But, fourth quarter was a low quarter and not a good run rate to look at.

Your next question comes from the line of Brian Roman with Robeco, Weiss, Peck & Greer. You may proceed. Brian Roman – Robeco, Weiss, Peck & Greer: Most of my questions have been answered but that doesn’t stop me from coming up with new questions. I just want to clarify these numbers, let’s see if I can get the release here, it was $35 million in non-performing assets and at the end of the quarter and you’re saying in the current quarter without assessing new non-performers coming on I see $4, $5, about $6 million of cures, is that correct?

On NPA? Brian Roman – Robeco, Weiss, Peck & Greer: Yeah.

We’re anticipating right now some of which have already occurred. Brian Roman – Robeco, Weiss, Peck & Greer: What do you mean it’s occurred? It’s occurred in the second quarter?

Yes. It occurred just right after the end of the month. For example, we had a $1.8 million non-accrual loan payoff a couple of days after the end of the quarter. That’s what I’m talking about. We have right now seen or are seeing about $7.4 million reduction in that NPA number. Brian Roman – Robeco, Weiss, Peck & Greer: That’s just from the cures. Are there new assets coming in to that classification, NPA?

Not that have not been added at this point. That’s not to say that there couldn’t be some that could occur and I’m not making a prediction one way or another as far as that. Brian Roman – Robeco, Weiss, Peck & Greer: We’ve got a lot of the second quarter to go, I realize that.

Exactly. But, what happens – this is just things that could have or should have occurred during the first quarter but didn’t on the other real estate. These are the $3.4 million I mentioned, those are actual properties on which there are contracts that should close generally this month, not anything that will close in later months. These are only items that will close this month or are suppose to close this month. The non-accrual loans that we’re talking are in fact loans that were not on non-accrual that have either already come off by way of payoffs or for example, somebody’s infused some capital in to one of the situations we’re talking about. Brian Roman – Robeco, Weiss, Peck & Greer: Okay. Without being too forward-looking and we were told at the beginning of this call that you might make forward-looking statements so you’ve got a Safe Harbor here, on that $34.78 million of non-performers at the end of the first quarter, you’ve got $7.4 going off, something is going to go on, as you look in your crystal ball at the end of the second quarter is up or down, the $34 million?

We’re not going to get forward-looking on that. I think where we mentioned we would be forward-looking is we gave a little bit of color on what we thought our run rate would be on charge offs for the year. Brian Roman – Robeco, Weiss, Peck & Greer: What was that number again, I missed it?

Well, what my comment was was that we had 26 basis points in the first quarter. We look at our normalized charge off run rate to be around 20 basis points. The last couple of years we’ve been under that. We anticipate this year looking at maybe five to possible 10 on the outside at this point in time. Brian Roman – Robeco, Weiss, Peck & Greer: So it’s 25 to 30 basis points for the year?

That’s correct. Brian Roman – Robeco, Weiss, Peck & Greer: Okay. Next question, staying on the theme of non-performers, it was up $10 million in the quarter sequentially. It’s actually doubled since the end of September, what’s actually flowing in to the non-performing categories at this point and where?

Are you talking about types? Brian Roman – Robeco, Weiss, Peck & Greer: Types and geography too.

To give you a weighting it would be more heavily towards the construction and development type lending. Brian Roman – Robeco, Weiss, Peck & Greer: C&D is how big again total portfolio?

Today it’s a total of $718 million. That’s all commercial, that’s all CRA. Construction development but it is commercial and residential a combination of the two not just residential. Brian Roman – Robeco, Weiss, Peck & Greer: So the markets where you’re seeing – I’m very glad, I’m heartened here that we’re going to see an improvement that we’re going to see $7.5 million go off that are there right now but it still went up $10 million again. Or, you could say $17 million over the last two quarters. Can you say again, which markets and what type of projects and I think you answered the project part.

In the markets would mainly be in the area of the Memphis MSA and the Nashville MSA. Some of the Nashville were loans that we identified prior to the merger and actually were brought in under SOP03-3. Brian Roman – Robeco, Weiss, Peck & Greer: Last question, outlook for the net interest margin, [inaudible] you were saying you saw like a core run rate of about 340, is that correct?

No, in the mid 340s, 345, 346. Brian Roman – Robeco, Weiss, Peck & Greer: That’s for the year?

That’s what we’re anticipating right now and we feel like we can be give or take three or four basis points. Either way we’re being very aggressive in trying to make up for the lack of loan growth. We’re being very deliberate in our lending. We are in fact adding a little bit stronger commercial lending group with a credit side devoted strictly to that commercial side. We put a floor on rates on many of our loans, most of our loans, as many as we can. So, we’re being pretty aggressive in what we’re doing on the loan side as far as covering ourselves both from a credit and interest rate standpoint.

Our next question comes from the line of Andy Stapp from B. Riley & Company. You may proceed. Andrew Stapp – B. Riley & Company, Inc.: I was wondering if you could just provide some color on the economies you serve and whether you see a light at the end of the tunnel and whether or not it’s a train? If you could do that for me I’d appreciate it.

Whether a train is coming from the other end? Let me throw a caveat in to the last answer when we were given Brian his answer. Anything we say based on future Fed rate cuts and the impact there, each time that happens there’s catch up time on the liability side so I will through that little caveat in. Looking at our market’s end and I’ll start with our legacy market here with the activity happening related to the automotive industry we’re not seeing a huge slowdown here but we’ve seen slowness I guess in housing starts to some degree and we’re seeing slowness in the sale of existing homes to some degree. But, the market itself, the economy itself is pretty good based on what’s going on. There’s a huge amount of construction going on just around the Tupelo area with the active construction going on right now with Toyota and Toyota Auto Body and Toyota Bokoshu, all three of whom have steel up at this point in time. So, as far as this part of our market, it’s doing well. DeSoto County, although we’re still seeing population growth occurring in DeSoto County that’s where we’ve seen the most slowness and one of the main reasons is that DeSoto County has been impacted in the past as far as growth by people exiting the Tennessee side of Memphis, DeSoto County, obviously the southern part of Memphis MSA. When subprime lending hit and some of these national lenders upped their credit standards it slowed down these first time home buyers from being able to acquire some homes and a lot of DeSoto County market was in fact for first time home buyers. So, that’s had an impact on that DeSoto County side. We’ve seen some slowness in the Memphis market;…

They were up in the fourth quarter. We commented that we had – let me give you a little run here. In the fourth quarter we had of number of loans past due we had about 1.7% and at the end of this quarter we had 1.66% as far as number of loans. We had a decrease in the number of past due loans but we saw the actual dollar volume jump up a little bit from 2% to 2.75% and basically that was a couple of loans that we were hopefully in the process of renewing. Those were 30 days or more. Andrew Stapp – B. Riley & Company, Inc.: Your mortgage banking revenues were stronger than I expected. Could you give me some color there? Is it a good run rate? Whatever color you can provide there.

I would like to say it’s a good run rate. I don’t know if we can sustain that for the full year. There was refinance activity accounted for about 60% of this volume. Again, Andy going back to what I said as far as what the Fed does and what happens otherwise, you get a big uptick in mortgage rates and that will certainly slow it down but there’s a lot of refinance activity right now. We’ve had resurgence in conventional government type loans after the subprime meltdown these conventional and government loans accounted for about 95% of our volume. Andrew Stapp – B. Riley & Company, Inc.: Okay. How do you see loan growth in coming quarters? In other words are you going to be cautious? Should we expect rather modest loan growth until the economy turns around?

Yeah. We would look for modest loan growth in the second quarter to flat. We’re looking at a decent pipeline but it’s below what it’s been. As we budgeted this year we anticipated whatever loan growth that we had would occur in the third and fourth quarters. We’re still seeing positive growth like in the national market they grew at about over 13% for the first quarter and we saw some growth in the Memphis market in the first quarter. Interestingly enough, Mississippi has shown some positive signs in the month of April but I’m still going to say we’ll see modest to flat for this quarter.

Our next question comes from a follow up question from Mr. Brian Klock from KBW. You may proceed sir. Brian Klock – Keefe, Bruyette & Woods: It looks like Andy got my loan question has been answered. For the second quarter you’re looking at modest to flat and earlier you were talking about the full year guidance for 08 might have been sort of up or single digits. Do you think that’s something that maybe pulls back a little bit because of the second quarter being a little bit slower growth and first quarter being a little modest as well? Should we expect full year growth to sort of be in the mid to upper single digits versus upper single digit guidance we had previously?

Brian, we’re still hoping to see, and again, it all depends on what’s happening in the economy, we’re very deliberate in our loan approval process right now. Quite frankly, some of the lack of volume is not due to opportunity but due to pricing and/or conservative credit approval on our part. We’re hoping that as the economy goes on others may not be as aggressive on their pricing and therefore some opportunities will arise from that side but we will not be compromising our credit posture no matter what happens in our second quarter. But, we think that we’ll probably be seeing some loans that we’ve been looking at right now – maybe not looking at right now as the borrowers being a little bit stronger later on in the year as the economy moves on too. A lot of it is too that we’re having some volume but we’re encouraging pay downs and obviously not seeing construction draws and things of that nature at this stage of the economy. Brian Klock – Keefe, Bruyette & Woods: I think that’s a prudent thing to do especially in this environment.

Right.

Your next question comes from the line of Charlie Ernst from Sandler O’Neill & Partners. You may proceed sir. Charlie Ernst – Sandler O’Neill & Partners: I just want to confirm a number that you mentioned, the 30 days past due number you said went from 2% to 2.75?

That’s correct. Charlie Ernst – Sandler O’Neill & Partners: Then you also said a number before that that was around 1.7, what was that number?

Let me give you those two again. It’s differentiating between numbers. We look at past dues two ways; we look at the number of loans that are past due and the dollars. The number of our past due loans dropped and therefore as a percentage of total loans we went from 1.7% of our loans being past due to 1.66% and this is 30 days or more. Dollar wise we went from 2% to 2.75% and that was based on a large relationship that had not been renewed that became 30 days past due because it had not been renewed at the end of the quarter, it slipped over in to the fourth quarter. Charlie Ernst – Sandler O’Neill & Partners: Was it past due for reasons of delinquent credit? Or, was it something technical? I guess I’m having a hard time why you would be quick to renew a loan that is showing signs of stress?

It’s not necessarily showing signs of stress. It’s a partnership and there are some issues that are being worked out among the partners that are delaying the renewal.

At this time we don’t have any further questions in the queue. I will pass the call over to management for closing remarks.

We appreciate everyone’s time today and your interest in Renasant Corporation and we’re looking forward to speaking to you again when we report our second quarter results for 2008. Thank you everybody.