Hancock Whitney Corporation · NASDAQ:HWC
Hancock Whitney — Hancock Holding — Q2 2017 Earnings Presentation
36 slides from Hancock Whitney's earnings presentation, Jul 18, 2017
Slide 1: Second Quarter 2017 Earnings Conference Call
7/19/2017 Second 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 June 30, 2017)
Corporate Profile (as of June 30, 2017) $26.6 billion in Total Assets$18.5 billion in Total Loans$21.4 billion in Total DepositsTangible Common Equity (TCE) 7.65%Nearly 200 banking locations and 262 ATMs across our footprintApproximately 4,200 employees corporate-wideRated among the strongest,safest
Slide 4: Second Quarter 2017 Highlights
(compared to first quarter 2017) Second Quarter 2017 Highlights Includes a full quarter impact from the FNBC I transaction (March 10, 2017) and a partial quarter’s impact from the FNBC II transaction (April 28, 2017)(see slides 24 and 25 for specifics on each transaction)Reached an agreement with th
Slide 5: Second Quarter EPS Highlights
Second Quarter EPS Highlights (includes a non-GAAP measure) Assumes a 35% tax rate
Slide 6: Termination of Loss Share Agreements
Termination of Loss Share Agreements In December 2009 the company acquired Peoples First Community Bank in Panama City, FL under loss-sharing agreements with the FDICThe non-single family portion of the agreement expired after 5 years and the single family portion would have expired after 10 yearsHa
Slide 7: Core Pre-Provision Net Revenue (PPNR) Continues to Grow
2Q17 vs. 2Q16 growth in core PPNR +19% $s in millions Core Pre-Provision Net Revenue (PPNR) Continues to Grow See slide 27 for non-GAAP reconciliation 2Q17 vs. 1Q17 growth in core PPNR +9%
Slide 8: Well-Diversified Loan Portfolio
Well-Diversified Loan Portfolio Loans totaled $18.5 billion at quarter-end, an increase of $269 million, or 1.5%, linked-quarterNet loan growth during the quarter was diversified across the footprint and also in areas identified as part of the company’s revenue-generating initiatives (mortgage, equi
Slide 9: Energy Portfolio Overview
Energy Portfolio Overview Energy loans totaled $1.2 billion, or 6.7% of total loans, down $59 million linked-quarter and down $250 million from a year agoLinked-quarter change reflects $134 million in net reductions, offset by $75 million in net increases
Slide 10: Energy Portfolio Overview (cont'd)
Energy Portfolio Overview (cont’d) Net decrease in outstandings of $59 million linked-quarter and a $12 million decrease in total commitments$25 million linked-quarter decrease in upstream outstandings and a $13 million increase in total commitments $15 million linked-quarter decrease in midstream s
Slide 11: 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 $65 million; no energy charge-offs in 2Q17Reflec
Slide 12: Asset Quality Measures Reflect Impact Of Energy Cycle
Asset Quality Measures Reflect Impact Of Energy Cycle NPA ratio 1.88%, up 9 bps linked-quarter Nonperforming assets totaled $347 million, up $19.7 million from March 31, 2017Nonperforming energy loans totaled $208 million at June 30, 2017, up $14 million from last quarterProvision for loan losses wa
Slide 13: Adequate Reserve Coverage
Adequate Reserve Coverage The allowance for loan losses (ALLL) was $221.9 million (1.20%) up $8 million from $213.6 million (1.17%) linked-quarterNo ALLL on FNBC portion of the portfolio; FNBC portfolios adjusted for the loan marksThe allowance maintained on the non-PCI portion of the loan portfolio
Slide 14: Securities Portfolio
Securities Portfolio Portfolio totaled $5.7 billion, up $668 million, or 13%, linked-quarterReinvested approximately $220 million in acquired FNBC II securities portfolio, and invested a portion of the excess liquidity from the transaction, towards the end of the second quarterYield 2.52%, unchanged
Slide 15: Solid Levels Of Core Deposit Funding
Solid Levels Of Core Deposit Funding Total deposits $21.4 billion, up $1.5 billion, or 8% linked-quarter; the increase is mainly related to the deposits acquired in the FNBC II transactionNoninterest-bearing demand deposits (DDA) increased $166 millionInterest-bearing transaction and savings deposit
Slide 16: Continued NIM Expansion
Continued NIM Expansion Reported net interest margin (NIM) 3.43%, up 6 bps linked-quarter Loan yield +20 bpsReflects full quarter impact from FNBC I loan portfolio and full quarter impact of March rate increaseYield on bond portfolio unchangedReinvested approximately $220 million of FNBC II securiti
Slide 17: Focus On Growing Core Noninterest Income Across Business Lines
Focus On Growing Core Noninterest Income Across Business Lines Noninterest income, including securities transactions, totaled $67.5 million, up $4.0 million, or 6%, linked-quarterAmortization of the indemnification asset for FDIC covered loans totaled $1.3 million, compared to $1.1 million in the fi
Slide 18: Remain Focused On Expense Control
Remain Focused On Expense Control Noninterest expenses totaled $183.5 million in 2Q17, up $19.9 million, or 12%, linked quarter; includes $10.6 million of nonoperating expenses (termination of loss share agreement and merger costs)Operating expense (noninterest expense excluding nonoperating items)
Slide 19: Managing Our Capital
TCE ratio 7.65%, down 29 bps linked-quarterTangible asset growth -35 bpsIntangibles -18 bpsTangible net retained earnings +16 bpsOCI +6 bpsStock issuance & other +2 bpsWill continue to manage capital in the best interests of the Company and our shareholders Managing Our Capital… (e) estimated
Slide 20: 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 transactionsConsolidated 10 overlapping branches in FNBC IClosing 25 of 29 overlapping branches in FNBC IIExpect significant consolidation of the
Slide 21: Near-Term Outlook
Near-Term Outlook se | Up $269 million or6% Includes approximately Expect net growth of $400-$500 million in 2H’ LOA $160 million in FNBC Il normal level of payoffs and paydowns on both energy a loans net oftthe loan FNBC loans however paydowns on energy loans remain Up $2.4 billion or 15% mark in 2
Slide 22: Long-Term Outlook
Long-Term Outlook Working to achieve objectives no later than 4Q18, if not soonerFNBC I & II help increase the potential for early achievement of long-term objectives 2017/18 Corporate Strategic Objectives (CSOs) Efficiency Ratio is noninterest expense to total net interest (TE) and noninterest inco
Slide 23: Appendix/Non-GAAP Reconciliations
Appendix/Non-GAAP Reconciliations
Slide 24: FNBC I (Transaction with FNBC) Summary
FNBC I (Transaction with FNBC) Summary Signed an agreement on December 30, 2016 to purchase certain assets and liabilities, including 9 branches, from FNBC; the transaction closed on March 10, 2017Purchased select loans, 9 FNBC branches, including associated transaction and savings deposits and PP&E
Slide 25: FNBC II (FDIC transaction) Summary
FNBC II (FDIC transaction) Summary On April 28, 2017 the Louisiana Office of Financial Institutions (OFI) closed First NBC Bank and appointed the FDIC as receiverWhitney Bank signed an agreement with the FDIC to acquire/assume certain assets and liabilities of First NBC BankApproximately $1.6 billio
Slide 26: Appendix: EPS Calculation and Non-GAAP Reconciliations
Appendix: EPS Calculation and Non-GAAP Reconciliations See Note 13 in the most recent 10K for more details on the two-class method for E.P.S. calculation.
Slide 27: Appendix: Core PPNR Reconciliation
Appendix: Core PPNR Reconciliation
Slide 28: Appendix: Core Revenue Reconciliation
Appendix: Core Revenue Reconciliation
Slide 29: Appendix: Purchase Accounting Adjustments Core NII & NIM Reconciliation
Appendix: Purchase Accounting Adjustments Core NII & NIM Reconciliation
Slide 30: Appendix: Core Revenue
Appendix: Core Revenue 205.0 Net Interest Income TE (core) 195.0 1850 175.0 165.0 Millions 155.0 145.0 195.0 yang [are] saz [aaN2 [VOI | 21S | VOT] MONS [TOI | BONE | OHA | WON | TNS | 2OHS | SONS | AOI | TOTS | 2aHG | 3016 | 4OI6 | TOIT | UIT (=e Aetsi| 1543 | 1680 | 1407 | 1473 | 1097 | 1004 | Ya9
Slide 31: Revenue Generating Initiatives - Fees
Revenue Generating Initiatives - Fees $s in thousands
Slide 32: Appendix: Operating Expense (excl nonoperating items)
Appendix: Operating Expense (excl nonoperating items)
Slide 33: Appendix: Historical Energy Data
Appendix: Historical Energy Data $s in millions
Slide 34: Appendix: Energy Portfolio Support Services
Appendix: Energy Portfolio Support Services
Slide 35: Appendix: Glossary of Terms
Appendix: Glossary of Terms Linked-quarter – current quarter compared to previous quarterLoan 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 ma
Slide 36: Second Quarter 2017 Earnings Conference Call
7/19/2017 Second Quarter 2017Earnings Conference Call