Renasant Corp. took a gamble six months ago, promising investors it would buy a failed bank with their money or they would get it back.

The $4.3 billion-asset company in Tupelo, Miss., has surpassed that expectation.

Last Friday, Renasant Bank made its second government-assisted acquisition since closing one of the highest price-to-tangible-book offerings among community banks last year. Its purchase of American Trust Bank in Roswell, Ga., from the Federal Deposit Insurance Corp. was smaller than its earlier deal for Crescent Bank and Trust in Jasper, Ga., but it added three branches and $147.4 million in assets to its small presence in north Georgia.

Now spanning four states and 80 branches, Renasant has kept its word to investors and made significant gains since its first failed-bank deal in July. So much so that the $42.2 million bargain it got in Crescent and the anticipated gain from American Trust have largely spared its freshly raised capital.

"The gain that was booked [with Crescent] provided most of the capital for the acquisition and allowed us to apply the capital raised for future growth opportunities," Robinson McGraw, the company's chairman and chief executive, said in a Tuesday interview.

"In addition to FDIC-assisted opportunities, we're also looking at open-bank and de novo branching opportunities," he said.

Many banking companies have mentioned acquisitions as a reason to raise capital in recent filings for stock offerings. Fewer have done so just to bid on failed banks, and fewer still have made the capital-raising contingent on winning such a bid.

"The offensive definition sells better than the defensive definition," said Kevin Fitzsimmons, an analyst at Sandler O'Neill & Partners LP.

For instance, Iberiabank Corp. in Lafayette, La., raised $172.7 million in July 2009 and the next month bought the failed CapitalSouth Bank in Birmingham, Ala.

Hancock Holding Co. in Gulfport, Miss., raised $175.5 million of capital in October 2009, just before its bank bought the $1.8 billion-asset Peoples First Community Bank in Panama City, Fla.

Unlike other, more aggressive failed-bank buyers in the Southeast, Renasant is likely to make smaller, FDIC-assisted deals, analysts said, especially since it wants to build out from markets it is already in.

"Some companies look for FDIC-assisted transactions to take advantage of the bargain purchase gains," McGraw said. "We're looking for something to enhance our franchise."

The company is also very strategy-minded in its deals, expanding within the regions where it already operates rather than taking a shotgun approach — spreading thinly and quickly through several states.

After its capital raising on July 23, Renasant immediately bought the $1 billion-asset Crescent Bank to make an entry into Georgia; it was the farthest eastward expansion for the 107-year-old bank.

Last week's purchase of American Trust "adds convenience in a market where they needed convenience," said Mark Muth, an analyst at Howe Barnes Hoefer & Arnett Inc. The latest deal "is more about augmenting and building" within Renasant's Georgia market, he said.

Muth compared the strategy to that of the $3.8 billion-asset HomeBancshares Inc. in Conway, Ark., whose Centennial Bank unit expanded farther into Florida last year by acquiring six banks from the FDIC.

All of the branches were in the western and central parts of the state.

Analysts do not expect such a grandiose move from Renasant.

"They're not going to be an aggressive bidder out there," Muth said.

"They won't pay top dollar for a bank in their marketplace," he added, "and it's not consistent with their history, either."

Renasant, which was started in a Mississippi bakery in 1904, has grown steadily, largely through traditional acquisitions and branch-building. But it was not until the mid-2000s that it began doing deals beyond its home state by entering Alabama and Tennessee.

After 2007, Renasant Bank had made no acquisitions until the Crescent Bank deal.

McGraw said the company targeted north Georgia because of the area's growth potential. Its two Georgia deals let it market to the 36,000 businesses that surround its 14 branches in that part of the state, he said.

This strategy struck a chord with investors, despite the fact that Renasant Bank must deal with its legacy other real estate owned (totaling $71.8 million at Dec. 31). The company sold $28 million of other real estate owned last year and has $4 million under contract for sale.

McGraw said the company is also seeing more opportunities to proceed with foreclosures and reach resolutions, which will eventually shrink its stock of bank-owned real estate.

As with any bank, Muth said, investors become increasingly concerned the longer that foreclosed properties remain on the balance sheet, particularly raw land that is the most difficult to sell or even appraise.

So far, analysts agreed, it is unlikely to interfere with Renasant's "measured" expansion. "It's a manageable issue as long as they have got the properties reasonably marked," said Jeff Davis, an analyst at Guggenheim Partners LLC.

Muth and Davis added that, with dozens of banks remaining under stress in Georgia, Renasant will have plenty of opportunities to bid within its range. "There's still a lot of wood to be chopped in Georgia," Davis said.

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