KBRA Affirms Ratings for BancPlus Corporation

KBRA affirms the senior unsecured debt rating of BBB, the subordinated debt rating of BBB-, and the short-term debt rating of K3 for Ridgeland, MS-based BancPlus Corporation ("BancPlus" or “the company”). In addition, KBRA affirms the deposit and senior unsecured debt ratings of BBB+, the subordinated debt rating of BBB, and the short-term deposit and debt ratings of K2 for lead subsidiary, BankPlus. The Outlook for all long-term ratings is Stable.

Key Credit Considerations

BancPlus’ ratings remain supported by comparatively favorable operating performance with average ROA tracking at ~1.0% from 2019-1H25 which continues to benefit from low credit costs, deposit stability, and material contributions from noninterest income. Growth in AUM continues to fuel diversity in fee income, with Wealth Management contributing 17% of noninterest income through 1H25. The company has fully realized cost savings and revenue benefits from the 2020 State Capital Corp. and 2022 First Trust Corporation acquisitions and continues to optimize the branch footprint. With a slightly liability-sensitive balance sheet, the company is positioned to benefit from an earnings perspective on further rate cuts.

Overall, we consider the company's loss absorbing capacity to be appropriate for its risk profile. Notably, Tier 1 capitalization includes $250 million of non-cumulative, perpetual preferred stock at a below-market 2% maximum coupon issued to the U.S. Treasury as part of the Emergency Capital Investment Program (“ECIP”) in 2Q22, which the company was able to access due to its CDFI designation. KBRA views this instrument as quasi-CET1 capital, given certain common equity-like features. Capitalization has trended upwards in recent periods on strong internal generation of ~25 bps of CET1 per quarter, and rebuilt capital levels better position BancPlus for M&A activity should an attractive opportunity arise as the company approaches the $10 billion asset threshold.

KBRA also acknowledges the company’s tenured and granular core deposit base, with $5.9 billion in core deposits representing 84% of total funding at 2Q25. Deposit costs peaked in 3Q24, and BancPlus continues to manage down the loan-to-deposit ratio toward peer levels on flatter loan growth. Primary and secondary liquidity remain adequate, in our view.

The CRE concentration continues to trend downward from 339% of RBC in 2022, and asset performance across the loan portfolio continues to align with the company’s long-term credit quality track record, which has generally included very low problem asset levels and nominal losses, further mitigated by an appropriate ACL coverage of 1.17% of total loans.

Rating Sensitivities

KBRA does not anticipate upwards rating action over the near term. Over the longer term, positive rating momentum could be driven by meaningful market share gains in core operating markets while maintaining sound capitalization and asset quality performance. Unexpected deterioration in asset quality or the funding profile, more aggressive capital management, or material erosion in competitive position in core operating markets could pressure ratings.

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