Hancock Whitney Corporation · NASDAQ:HWC
Hancock Whitney — Hancock Holding — Q1 2017 Earnings Presentation
34 slides from Hancock Whitney's earnings presentation, Apr 18, 2017
Slide 1: First Quarter 2017 Earnings Conference Call
4/19/2017 First Quarter 2017Earnings Conference Call
Slide 2: Important Cautionary Statement About Forward-Looking Statements
Important 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 ma
Slide 3: Corporate Profile (as of March 31, 2017)
Corporate Profile (as of March 31, 2017) $25.5 billion in Total Assets$18.2 billion in Total Loans$19.9 billion in Total DepositsTangible Common Equity (TCE) 7.94%Nearly 200 banking locations and 264 ATMs across our footprintApproximately 3,900 employees corporate-wideRated among the strongest,safes
Slide 4: First Quarter 2017 Highlights
(compared to fourth quarter 2016) First Quarter 2017 Highlights Net income of $49.0 million, down $2.8 million, or 5%; core pre-provision net revenue (PPNR) of $93.3 million, up $6.1 million or 7% Includes a partial quarter impact from the acquisition of selected assets and liabilities of First NBC
Slide 5: Core pre-provision net revenue (PPNR) continues to grow
1Q17 vs. 1Q16 growth in core PPNR +22% $s in millions Core pre-provision net revenue (PPNR) continues to grow See slide 24 for non-GAAP reconciliation 1Q17 vs. 4Q16 growth in core PPNR +7% 1Q17 vs. 1Q16 growth in core PPNR +22% $s in millions Core pre-provision net revenue (PPNR) continues to grow S
Slide 6: Well-Diversified Loan Portfolio
Well-Diversified Loan Portfolio Loans totaled $18.2 billion at quarter-end, an increase of $1.5 billion, or 9%, linked-quarterBalance reflects approximately $1.2 billion in loans acquired from First NBC transaction (net of loan mark)Net loan growth during the quarter was diversified across the footp
Slide 7: Energy Portfolio Overview
Energy Portfolio Overview Energy loans totaled $1.3 billion, or 7.1% of total loans, down $123 million linked-quarter and down $344 million from a year agoLinked-quarter change reflects approximately $160 million in net reductions, plus approximately $23 million in charge-offs, offset by approximate
Slide 8: Energy Portfolio Overview (cont'd)
Energy Portfolio Overview (cont’d) Net decrease in outstandings of $123 million linked-quarter and a $115 million decrease in total commitments$57 million linked-quarter decrease in upstream outstandings and a $43 million decrease in total commitments $4 million linked-quarter increase in midstream
Slide 9: Energy Allowance and Category Trends
Energy Allowance and Category Trends Management continues to estimate that charge-offs from energy-related credits could approximate $65-$95 million over the duration of the cycleCharge-offs to-date for current energy cycle (Nov ‘14 – March ‘17) total approximately $65 million; includes $23 million
Slide 10: Asset Quality Measures Reflect Impact Of Energy Cycle
Asset Quality Measures Reflect Impact Of Energy Cycle NPA ratio 1.79%, down 46 bps linked-quarter Nonperforming assets totaled $327 million, down $50 million from December 31, 2016Nonperforming energy loans totaled $194 million at March 31, 2017, down $45 million from last quarterProvision for loan
Slide 11: Adequate Reserve Coverage
Adequate Reserve Coverage The allowance for loan losses (ALLL) was $213.6 million (1.17%) down $16 million from $229.4 million (1.37%) linked-quarter (no ALLL on FNBC portion of the portfolio; FNBC portfolio adjusted for 4% loan mark)The allowance maintained on the non-PCI portion of the loan portfo
Slide 12: Securities Portfolio
Securities Portfolio Portfolio totaled $5.0 billion, down slightly linked-quarter Yield 2.52%, up 14 bps linked-quarterUnrealized net loss of $42.8 million on AFS50% HTM, 50% AFSDuration 5.00 years compared to 5.07 years at 12-31-16Premium amortization down $0.9 million linked-quarterBalance sheet i
Slide 13: Solid Levels Of Core Deposit Funding
Solid Levels Of Core Deposit Funding Total deposits $19.9 billion, up $498 million, or 3% linked-quarter, includes $398 million acquired in the FNBC transactionNoninterest-bearing demand deposits (DDA) increased $64 millionInterest-bearing transaction and savings deposits increased $252 millionTime
Slide 14: Core NIM Expansion
Core NIM Expansion See slide 26 for non-GAAP reconciliation Reported net interest margin (NIM) 3.37%, up 11 bps linked-quarter Core NIM of 3.29% increased 10 bps linked-quarterImproved mix of earning assets; increased volumeCore loan yield +16 bpsMainly related to FNBC acquired loans at 5%+ Yield on
Slide 15: Focus On Growing Core Noninterest Income Across Business Lines
Focus On Growing Core Noninterest Income Across Business Lines Noninterest income, including securities transactions, totaled $63.5 million, down $2.4 million, or 4%, linked-quarterAmortization of the indemnification asset for FDIC covered loans totaled $1.1 million, down from $1.2 million in the fo
Slide 16: Remain Focused On Expense Control
Remain Focused On Expense Control Noninterest expenses totaled $163.5 million in 1Q17, up $7.3 million, or 5%, linked quarter; includes $6.5 million of acquisition costsNoninterest expense excluding acquisition costs (operating expense) totaled $157.1 million, up $0.8 million or less than 1%Personne
Slide 17: Managing Our Capital
TCE ratio 7.94%, down 70 bps linked-quarterTangible asset growth (including FNBC asset acquisition) -48 bpsIntangibles -43 bpsTangible net retained earnings +14 bpsOCI +1 bpOption exercises +6 bpsWill continue to manage capital in the best interests of the Company and our shareholders Managing Our C
Slide 18: With Financially Compelling Return on Investment
…With Financially Compelling Return on Investment Signed an agreement on December 30, 2016 to purchase certain assets and liabilities, including 9 branches, from First NBC Bank; the transaction closed on March 10, 2017Transaction was between Hancock Holding Company’s banking subsidiary Whitney Bank
Slide 19: FNBC -- Compelling Financial Impact
FNBC -- Compelling Financial Impact Conservative level of initial loan and deposit run-off, no accretion, provision expense, additional operating expenses were included in modeling projectionsCurrent run-rate reflects better than expected level of earnings Includes impact of accretionNo provision fo
Slide 20: Near-Term Outlook
Near-Term Outlook See slides 24-26 for non-GAAP reconciliations
Slide 21: 2017 Strategic Objectives (includes FNBC)
2017 Strategic Objectives (includes FNBC) Loan growth 15-17% (EOP)Includes $1.2B of loans acquired from FNBC in 1Q17 (net of loan mark)Fund loan growth primarily with depositsRevenue growth 11-13% (includes only the March 2017 interest rate hike for 2017)Expense growth 4-5%Core PPNR growth 20-22%PLL
Slide 22: Appendix/Non-GAAP Reconciliations
Appendix/Non-GAAP Reconciliations
Slide 23: Appendix: EPS Calculation
Appendix: EPS Calculation See Note 13 in the most recent 10K for more details on the two-class method for E.P.S. calculation.
Slide 24: Appendix: Core PPNR Reconciliation
Appendix: Core PPNR Reconciliation
Slide 25: Appendix: Core Revenue Reconciliation
Appendix: Core Revenue Reconciliation
Slide 26: Appendix: Purchase Accounting Adjustments Core NII & NIM Reconciliation
Appendix: Purchase Accounting Adjustments Core NII & NIM Reconciliation
Slide 27: Appendix: Core Revenue
Appendix: Core Revenue 195.0 Net Interest Income TE (core) 185.0 175.0 165.0 155.0 145.0 Eu 487 213 1994 wz] 473 | Tas 1350 aig [2012 197 | Bars | 4ars [Tare [=e Acad te83 | s30 1985 | 1999 | 1998 ane | sare | aara Piss [eat Ts [res Tais | 2018 | 72 | 1838 | 1670 3015 | aaTs | TOI6 | Bae | Sate | aa
Slide 28: Revenue Generating Initiatives - Fees
Revenue Generating Initiatives - Fees $s in thousands *Includes Hancock Horizon Funds sale
Slide 29: Appendix: Operating Expense (excl nonoperating items)
Appendix: Operating Expense (excl nonoperating items)
Slide 30: Appendix: Historical Energy Data
Appendix: Historical Energy Data $s in millions
Slide 31: Appendix: Energy Portfolio Support Services
Appendix: Energy Portfolio Support Services
Slide 32: Appendix: Purchase Accounting Impact/Trend
Impact of Purchase Accounting Adjustments(projections will be updated quarterly; subject to change) Appendix: Purchase Accounting Impact/Trend *Projected revenue includes loan accretion from Whitney, Peoples First and FNBC, offset by amortization of the Whitney bond portfolio premium and amortizatio
Slide 33: Appendix: Glossary of Terms
Appendix: Glossary of Terms Loan Mark – Fair value discount on loans acquired in a business combinationLPO – Loan production officeLQA – Linked-quarter annualizedM&A – Mergers and acquisitionsNII – Net interest income NIM – Net interest marginNPA – Nonperforming assetsO&G – Oil and gasORE – Other re
Slide 34: First Quarter 2017 Earnings Conference Call
4/19/2017 First Quarter 2017Earnings Conference Call