Hancock Whitney Corporation · NASDAQ:HWC
Hancock Whitney — Hancock Holding — Q3 2017 Earnings Presentation
33 slides from Hancock Whitney's earnings presentation, Oct 17, 2017
Slide 1: Third Quarter 2017 Earnings Conference Call
Third Quarter 2017 Earnings Conference Call 10/18/2017
Slide 2: Cautionary Statement About Forward-Looking Statements
This presentation contains forward-looking statements within the meaning of section 27A of the Securities Act of 1933, as amended, and section 21E of the Securities Exchange Act of 1934, as amended. Forward looking statements that we may make include statements regarding balance sheet and revenue gr
Slide 3: Company at a glance: $26.8 billion in total assets
$26.8 billion in Total Assets $18.8 billion in Total Loans $21.5 billion in Total Deposits Tangible Common Equity (TCE) 7.80% Nearly 200 banking locations and 275 ATMs across our footprint Approximately 4,050 employees corporate-wide Rated among the strongest, safest financial institutions in the co
Slide 4: 3Q17 results reflect the full impact of both FNBC transactions
3Q17 results reflect the full impact of both FNBC transactions Reported earnings increased $6.6 million, or 13%; excluding nonoperating items, earnings increased $7.1 million, or 12% Loans increased $312 million, or 7% linked-quarter annualized Energy loans declined $97 million and comprise 6.0% of
Slide 5: 75% Improvement in Core Pre-Provision Net Revenue
75% Improvement in Core Pre-Provision Net Revenue (PPNR) since 1Q15 $120.0 $110.0 7 3Q17 vs. 2Q17 growthin core PPNR +9% $100.0 $90.0 $80.0 $70.0 $60.0 Thats 2015 3Q15 4Q15 1a16 | 2Q16 3Q16 4Q16 1Q17 2017 3Q17 Actual] $63.3 | $65.4 | $704 $68.0 | $76.4 $85.2 $86.0 | $87.2 $93.3 [ $1016 | $1114 Ssinm
Slide 6: Well-Diversified Loan Portfolio
Well-Diversified Loan Portfolio Loans totaled $18.8 billion at quarter-end, an increase of $312 million, or 2%, linked-quarter Reflects $97 million net decrease in energy-related loans Net loan growth during the quarter was diversified across the footprint and also in areas identified as part of the
Slide 7: Energy Portfolio Overview
Energy Portfolio Overview Energy loans totaled $1.1 billion, or 6.0% of total loans, down $97 million linked-quarter and down $270 million from a year ago Linked-quarter change reflects $142 million in net reductions and $8 million of charge-offs, offset by $52 million in fundings
Slide 8: Energy portfolio outstandings and commitments
Net decrease in outstandings of $97 million linked-quarter and a $154 million decrease in total commitments $20 million linked-quarter decrease in upstream outstandings and a $38 million decrease in total commitments $11 million linked-quarter decrease in midstream sector outstandings and a $5 milli
Slide 9: Energy Allowance and Category Trends
Energy Allowance and Category Trends Despite the recent stabilization in oil prices, management continues to expect a lag in the recovery for support services credits The energy portion of the allowance remains elevated as a reserve for the support sector credits; management continues to believe the
Slide 10: Asset Quality Measures Reflect Impact Of Energy Cycle
Asset Quality Measures Reflect Impact Of Energy Cycle NPA ratio 2.06%, up 18 bps linked-quarter Nonperforming assets totaled $388 million, up $40.8 million from June 30, 2017 Nonperforming energy loans totaled $221 million at September 30, 2017, up $13 million linked-quarter Nonenergy nonperforming
Slide 11: Adequate Reserve Coverage
Adequate Reserve Coverage The allowance for loan losses (ALLL) was $223.1 million (1.19%) up $1.3 million from $221.9 million (1.20%) linked-quarter No ALLL on FNBC portion of the portfolio; FNBC portfolios carried net of the loan marks ALLL for energy credits was $79.8 million, or 7.0%, at Septembe
Slide 12: Securities Portfolio
Securities Portfolio Portfolio totaled $5.6 billion, down $44 million, or 1%, linked-quarter Yield 2.48%, down 4 bps linked-quarter Premium amortization up $1.6 million linked-quarter (3 bps impact) Unrealized net loss of $24.1 million on AFS 49% HTM, 51% AFS Duration 4.64 years compared to 4.84 yea
Slide 13: Solid Levels Of Core Deposit Funding
Solid Levels Of Core Deposit Funding Total deposits $21.5 billion, up $91 million, or less than 1% linked-quarter; increase in average balances related to full quarter impact from FNBC II Noninterest-bearing demand deposits (DDA) increased $8 million Interest-bearing transaction and savings deposits
Slide 14: Continued NIM Expansion
Continued NIM Expansion Reported net interest margin (NIM) of 3.44%, up 1 bp linked-quarter Loan yield up 3 bps Reflects full quarter impact of June rate increase partly offset by $1.4 million of interest reversals on nonaccrual loans Yield on securities portfolio down 4 bps Lower yield related to i
Slide 15: Focus On Growing Noninterest Income
Continued NIM Expansion Focus On Growing Noninterest Income Noninterest income, totaled $67.1 million, down slightly linked-quarter Amortization of FDIC loss share receivable eliminated in the third quarter resulting from the termination of the loss share agreements with the FDIC in the second quart
Slide 16: FNBC Expense Synergies Goal Attained
FNBC Expense Synergies Goal Attained Noninterest expenses totaled $177.6 million in 3Q17, down $5.9 million, or 3%, linked quarter; includes $11.4 million of nonoperating expenses Operating expenses (noninterest expense excluding nonoperating items) totaled $166.2 million, down $6.6 million or 4%; r
Slide 17: Managing Our Capital
Managing Our Capital TCE ratio 7.80%, up 15 bps linked-quarter Tangible asset growth -6 bps Tangible net retained earnings +17 bps OCI +2 bps Option exercises & other +2 bps Will continue to manage capital in the best interests of the Company and our shareholders
Slide 18: Near-Term Outlook
Near-Term Outlook Net Interest Margin (NIM) Revenue (net interest income (TE) plus noninterest income) Loan Loss Provision Noninterest Expense excluding nonoperating items (operating expense) Tax Rate Up $312 million or 7% LOA; up $2.7 billion or 17% Y-0-Y 3.44% 3.32% (core) $278.5 milion $13.0 mill
Slide 19: Long-Term Outlook
Long-Term Outlook 2017/2018 Corporate Strategic Objectives (CSOs) Earnings (EPS)/quarter $0.70 - $0.80+ $.76 (excluding nonoperating items) ROA (operating) 1.00% - 1.10%+ 0.99% ROE (operating) 11% - 13% 9.27% TGE 8%t+ 7.80% Efficiency Ratio 59% - 61% 57.5% Efficiency Ratio is noninterest expense to
Slide 20: Non-GAAP Reconciliations
Non-GAAP Reconciliations @¥ Hancock Holdi
Slide 21: EPS Calculation and Non-GAAP Core PPNR Reconciliation
EPS Calculation and Non-GAAP Core PPNR Reconciliation
Slide 22: Core PPNR Reconciliation
Core PPNR Reconciliation $s in millions Net interest income Noninterest income Noninterest expense Pre-provision net revenue Tax-equivalent_(TE) adjustment Pre-provision net revenue (TE) Nonoperating items, net Purchase accounting adjustments (see bow Core pre-provision net revenue Purchase Accounti
Slide 23: Core Revenue Reconciliation
Core Revenue Reconciliation
Slide 24: Purchase Accounting Adjustments Core NII & NIM Reconciliation
Purchase Accounting Adjustments Core NII & NIM Reconciliation Purchase
Slide 25: Appendix
Appendix @¥ Hancock Holding C
Slide 26: Appendix: Two Financially Compelling Investments
Appendix: Two Financially Compelling Investments Acquired approximately $2.6 billion in assets and liabilities in two transactions related to FNBC for $77 million transaction premium In-market, low-risk transactions Consolidated 10 overlapping branches in FNBC I Closed 25 of 29 overlapping branches
Slide 27: Appendix: Revenue Generating: Core Revenue
Appendix Appendix: Revenue Generating: Core Revenue
Slide 28: Appendix: Revenue Generating Initiatives - Fees
Appendix: Revenue Generating Initiatives - Fees
Slide 29: Appendix: Operating Expense (excl nonoperating items)
Appendix: Operating Expense (excl nonoperating items)
Slide 30: Appendix: Historical Energy Data
Appendix: Historical Energy Data
Slide 31: Appendix: Energy Portfolio Support Services
Appendix: Energy Portfolio Support Services
Slide 32: Appendix: Glossary of Terms
Appendix: Glossary of Terms 1017 First Quarter of 2017 2H17— SecondHalf of 2017 (2 and 4® quarters) 2017 ~ Second Quarter of 2017 30417 - Third Quarter of 2017 Fourth Quarter of 2017 Fourth Quarter of 2018 AES — Available for sale securties ALLL ~ Allowance for loan andlease losses Annualized ~ Calc
Slide 33: Third Quarter 2017 Earnings Conference Call
Third Quarter 2017 Earnings Conference Call 10/18/2017