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8-K - 8-K - HANCOCK WHITNEY CORP | d55233d8k.htm |
Exhibit 99.1
For Immediate Release
October 22, 2015
For More Information
Trisha Voltz Carlson
SVP, Investor Relations Manager
504.299.5208
trisha.carlson@hancockbank.com
Hancock reports third quarter 2015 financial results
Strategic initiatives drive improving revenue and EPS; continue to build energy reserve
Highlights of the companys third quarter of 2015 results (compared to second quarter 2015):
| Earnings increased $6.3 million, or 18% |
| E.P.S. of $.52 increased 18% |
| Pre-tax, pre-provision earnings grew 22% |
| Provision reflects additional $5 million build for energy portfolio with reserve exceeding 2% |
| Loans increased $418 million, or 12% (annualized) |
| Deposits increased $138 million, or 3% (annualized) |
| Core revenue increased $6.2 million |
| Core NIM of 3.15% increased 1 basis point; core loan yield expanded 4 basis points |
| Operating expense up less than 1% |
GULFPORT, Miss. (October 22, 2015) Hancock Holding Company (Nasdaq: HBHC) today announced its financial results for the third quarter of 2015. Net income for the third quarter of 2015 was $41.2 million, or $.52 per diluted common share, compared to $34.8 million, or $.44 in the second quarter of 2015 and $46.6 million, or $.56, in the third quarter of 2014. The year-over-year decline in earnings was mainly related to a decrease in purchase accounting income of approximately $13.0 million (pre-tax). The quarter-over-quarter change was mainly related to the $8.9 million of nonoperating expenses included in the second quarter of 2015.
The quality of our results is improving each quarter and we are growing our company while also managing through the current energy cycle, said President and CEO John M. Hairston. The initiatives we have put in place are working. We grew core revenue over $6 million linked-quarter while pre-tax, pre-provision earnings increased over $12 million. This quarter we added another $5 million, or almost a nickel of earnings, to the provision to build the energy reserve and remain confident that any credit losses we see today from the low oil prices are reserved for and should not be significant. As we have noted since the beginning of this energy cycle, we believe the cycle to be manageable without putting our strong capital levels at risk.
1
Hancock reports third quarter 2015 financial results
October 22, 2015
Loans
Total loans at September 30, 2015 were $14.8 billion, up $418 million, or 3%, from June 30, 2015. Many markets across the footprint reported net loan growth during the quarter, with growth also noted in various business lines such as indirect, mortgage and specialty finance.
At September 30, 2015, loans in the energy segment totaled $1.6 billion, or 11% of total loans. The energy portfolio declined approximately $10 million linked-quarter and is comprised of credits to both the E&P industry and support industries. Additional details of the energy portfolio are included in the presentation slides posted on our Investor Relations website.
Average loans totaled $14.5 billion for the third quarter of 2015, up $373 million, or 3%, linked-quarter.
On October 6, 2015, the company announced the opening of a loan production office in Nashville, Tennessee, and an agreement to purchase approximately $190 million of healthcare loans. This transaction supports our initiative to continue diversifying our loan portfolio, in addition to capitalizing on opportunities we see to expand the healthcare lending business across our Gulf South footprint. The acquired loans will be included in our fourth quarter of 2015 results.
Deposits
Total deposits at September 30, 2015 were $17.4 billion, up $138 million, or 1%, from June 30, 2015. Average deposits for the third quarter of 2015 were $17.3 billion, up $451 million, or 3%, linked-quarter.
Noninterest-bearing demand deposits (DDAs) totaled $6.1 billion at September 30, 2015, down $105 million from June 30, 2015. DDAs comprised 35% of total period-end deposits at September 30, 2015.
Interest-bearing transaction and savings deposits totaled $7.4 billion at the end of the third quarter of 2015, up $366 million, or 5%, from June 30, 2015. Time deposits of $2.2 billion increased $72 million, or 3%, while interest-bearing public fund deposits decreased $194 million, or 10%, to $1.8 billion at September 30, 2015.
Asset Quality
Nonperforming assets (NPAs) totaled $206 million at September 30, 2015, up $41 million from June 30, 2015. During the third quarter of 2015, total nonperforming loans increased approximately $46 million while foreclosed and surplus real estate (ORE) and other foreclosed assets decreased approximately $5 million. The net increase in nonperforming loans was mainly related to three energy loans which were downgraded during the quarter. Nonperforming assets as a percent of total loans, ORE and other foreclosed assets was 1.39% at September 30, 2015, up 24 bps from June 30, 2015.
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Hancock reports third quarter 2015 financial results
October 22, 2015
The total allowance for loan losses was $139.6 million at September 30, 2015, up $8.5 million from June 30, 2015. The ratio of the allowance for loan losses to period-end loans was 0.95% at September 30, 2015, up from 0.91% at June 30, 2015. The allowance maintained on the non-FDIC acquired portion of the loan portfolio increased $7.0 million linked-quarter, totaling $114 million, and the reserve on the FDIC acquired loan portfolio increased approximately $1.5 million linked-quarter.
Pricing pressures on oil continued during the third quarter and led to additional downward pressure on risk ratings. Based on those changes, and updates to the qualitative factors related to energy, the reserve for the energy portfolio was increased approximately $5.0 million, to $35 million, linked-quarter. The increase in risk rating downgrades within the energy portfolio during the third quarter included approximately $66 million of shared national credits that were on appeal at June 30, 2015. The impact to the allowance for the possible downgrades on these shared national credits was included in the second quarter of 2015.
Management believes that if further risk rating downgrades occur they could lead to additional loan loss provisions but not translate to significant credit losses. The impact and severity of risk rating migration, associated provision and net charge-offs will depend on overall oil price reduction and the duration of the cycle. Additional details of the energy portfolio are included in the presentation slides posted on our Investor Relations website.
Net charge-offs from the non-FDIC acquired loan portfolio were $3.5 million, or 0.09% of average total loans on an annualized basis in the third quarter of 2015, up from $1.2 million, or 0.03% of average total loans in the second quarter of 2015.
During the third quarter of 2015, Hancock recorded a total provision for loan losses of $10.1 million, up $3.5 million from the second quarter of 2015.
Net Interest Income and Net Interest Margin
Net interest income (TE) for the third quarter of 2015 was $160.1 million, up $5.3 million from the second quarter of 2015. During the third quarter, the impact on net interest income from purchase accounting adjustments (PAAs) declined $1.3 million compared to the second quarter of 2015. Excluding the impact from purchase accounting items, core net interest income increased $6.6 million linked-quarter. Average earning assets were $19.4 billion for the third quarter of 2015, up $653 million, or 3%, from the second quarter of 2015.
The reported net interest margin (TE) was 3.28% for the third quarter of 2015, down 2 bps from the second quarter of 2015. The decline was mainly related to the decrease in purchase accounting adjustments noted above. The core net interest margin (reported net interest income (TE) excluding total net purchase accounting adjustments, annualized, as a percent of average earning assets) increased 1 basis point to 3.15% during the third quarter of 2015. An increase in the core loan yield (4 bps) and an increase in the securities portfolio yield (3 bps), offset by a slight increase in the cost of funds (2 bps), contributed to the expansion in the margin.
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Hancock reports third quarter 2015 financial results
October 22, 2015
Noninterest Income
Noninterest income, including securities transactions, totaled $60.2 million for the third quarter of 2015, down $0.7 million, or 1%, from the second quarter of 2015. Included in the total is a reduction of $1.6 million related to the amortization of the FDIC indemnification asset, compared to a reduction of $1.3 million in the second quarter of 2015. Excluding the impact of this item and securities transactions, core noninterest income totaled $61.8 million, down slightly linked-quarter.
Service charges on deposits totaled $18.6 million for the third quarter of 2015, up $0.7 million, or 4%, from the second quarter of 2015. Bank card and ATM fees totaled $11.6 million, down $0.2 million, or 2%, from the second quarter of 2015.
Trust fees totaled $11.3 million, down $0.4 million, or 4%, linked-quarter. The decrease was due, in part, to seasonal tax return preparation fees in the second quarter of 2015. Investment and annuity income and insurance fees totaled $8.4 million, up $1 million, or 13%, linked-quarter.
Fees from secondary mortgage operations totaled $3.4 million for the third quarter of 2015, down $0.2 million, or 6%, linked-quarter. During the third quarter, a slightly smaller portion of loan production was sold in the secondary market compared to last quarter.
Other noninterest income (excluding the amortization of the FDIC indemnification asset noted above) totaled $8.4 million, down $1.2 million, or 12%, from the second quarter of 2015. The decline is mainly related to a lower level of customer interest rate swap income in the third quarter.
Noninterest Expense & Taxes
Noninterest expense for the third quarter of 2015 totaled $151.2 million. There were no nonoperating expenses in the third quarter of 2015 compared to $8.9 million in the second quarter of 2015. Excluding nonoperating items, expenses were up $1.2 million, or less than 1%, linked-quarter. (The details of the changes in the noninterest expense categories noted below exclude the impact of nonoperating items.)
Total personnel expense was $84.2 million in the third quarter of 2015, up $1.6 million, or 2%, from the second quarter of 2015. The increase primarily reflects salary and incentive expenses related to revenue initiatives.
Occupancy and equipment expense totaled $14.8 million in the third quarter of 2015, down $1.0 million, or 6%, from the second quarter of 2015.
ORE expense totaled $0.4 million for the third quarter of 2015, down $0.1 million from the second quarter of 2015.
Other operating expense totaled $45.8 million in the third quarter of 2015, up $0.8 million, or 2%, from the second quarter of 2015.
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Hancock reports third quarter 2015 financial results
October 22, 2015
The effective income tax rate for the third quarter of 2015 was 26%, unchanged from the second quarter of 2015. Management expects the effective income tax rate to approximate 25-27% in 2015. The effective income tax rate continues to be less than the statutory rate of 35% due primarily to tax-exempt income and tax credits.
Capital
Common shareholders equity at September 30, 2015 totaled $2.5 billion. The tangible common equity (TCE) ratio was 8.24%, up 12 bps from June 30, 2015. During the quarter the company repurchased 568,279 common shares under the new 5% common stock buyback authorization announced in late August 2015. The shares were repurchased at an average price of $27.39. Additional capital ratios are included in the financial tables.
Conference Call and Slide Presentation
Management will host a conference call for analysts and investors at 9:00 a.m. Central Time on Friday, October 23, 2015 to review the results. A live listen-only webcast of the call will be available under the Investor Relations section of Hancocks website at www.hancockbank.com. Additional financial tables and a slide presentation related to third quarter results are also posted as part of the webcast link. To participate in the Q&A portion of the call, dial (877) 564-1219 or (973) 638-3429. An audio archive of the conference call will be available under the Investor Relations section of our website. A replay of the call will also be available through October 30, 2015 by dialing (855) 859-2056 or (404) 537-3406, passcode 50555582.
About Hancock Holding Company
Hancock Holding Company is a financial services company with regional business headquarters and locations throughout a growing Gulf South corridor. The companys banking subsidiary provides a comprehensive network of full-service financial choices through Hancock Bank locations in Mississippi, Alabama, and Florida and Whitney Bank offices in Louisiana and Texas, including traditional and online banking; commercial and small business banking; energy banking; private banking; trust and investment services; certain insurance services; mortgage services; and consumer financing. More information and online banking are available at www.hancockbank.com and www.whitneybank.com.
Forward-Looking Statements
This news release 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, and we intend such forward-looking statements to be covered by the safe harbor provisions therein and are including this statement for purposes of invoking these safe-harbor provisions. Forward-looking statements provide projections of results of operations or of financial condition or state other forward-looking information, such as expectations about future conditions and descriptions of plans and strategies for the future. Forward-looking statements that we may make include, but may not be limited to, comments with respect to future levels of economic activity in our markets, including the impact of volatility of oil and gas prices on our energy portfolio and associated loan loss reserves and the downstream impact on businesses that support the energy sector, especially in the Gulf Coast region, loan growth expectations, deposit trends, credit quality trends, net interest margin trends, future expense levels, success of revenue-generating initiatives, projected tax rates, future profitability, improvements in expense to revenue (efficiency) ratio, purchase accounting impacts such as accretion levels, possible repurchases of shares under stock buyback programs, and the financial impact of regulatory requirements. Hancocks ability to accurately project results, predict the effects of future plans or strategies, or predict market or economic developments is inherently limited. Although Hancock believes that the expectations reflected in its forward-looking statements are based on reasonable assumptions, actual results and performance could differ materially from those set forth
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Hancock reports third quarter 2015 financial results
October 22, 2015
in the forward-looking statements. Factors that could cause actual results to differ from those expressed in Hancocks forward-looking statements include, but are not limited to, those risk factors included in Hancocks public filings with the Securities and Exchange Commission, which are available at the SECs internet site (http://www.sec.gov). You are cautioned not to place undue reliance on these forward-looking statements. Hancock does not intend, and undertakes no obligation, to update or revise any forward-looking statements, whether as a result of differences in actual results, changes in assumptions or changes in other factors affecting such statements, except as required by law.
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HANCOCK HOLDING COMPANY
FINANCIAL HIGHLIGHTS
(Unaudited)
Three Months Ended | Nine Months Ended | |||||||||||||||||||
(amounts in thousands, except per share data) |
9/30/2015 | 6/30/2015 | 9/30/2014 | 9/30/2015 | 9/30/2014 | |||||||||||||||
INCOME STATEMENT DATA |
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Net interest income |
$ | 156,830 | $ | 151,791 | $ | 163,541 | $ | 466,779 | $ | 493,881 | ||||||||||
Net interest income (TE) (a) |
160,134 | 154,879 | 166,230 | 476,127 | 501,759 | |||||||||||||||
Provision for loan losses |
10,080 | 6,608 | 9,468 | 22,842 | 24,122 | |||||||||||||||
Noninterest income excluding securities transactions |
60,207 | 60,874 | 57,941 | 177,294 | 171,038 | |||||||||||||||
Securities transactions gains |
4 | | | 337 | | |||||||||||||||
Noninterest expense (excluding nonoperating items) |
151,193 | 149,990 | 145,192 | 447,384 | 436,901 | |||||||||||||||
Nonoperating items |
| 8,927 | 3,887 | 16,241 | 16,018 | |||||||||||||||
Net income |
41,166 | 34,829 | 46,553 | 116,154 | 135,630 | |||||||||||||||
Operating income (b) |
41,166 | 40,631 | 49,079 | 126,494 | 147,769 | |||||||||||||||
Pre-tax, pre-provision (PTPP) profit |
69,152 | 56,836 | 75,092 | 190,133 | 219,878 | |||||||||||||||
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PERIOD-END BALANCE SHEET DATA |
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Loans |
$ | 14,763,050 | $ | 14,344,752 | $ | 13,348,574 | $ | 14,763,050 | $ | 13,348,574 | ||||||||||
Investment securities |
4,548,922 | 4,445,452 | 3,913,370 | 4,548,922 | 3,913,370 | |||||||||||||||
Earning assets |
19,526,150 | 19,409,963 | 17,748,600 | 19,526,150 | 17,748,600 | |||||||||||||||
Total assets |
21,608,150 | 21,538,405 | 19,985,950 | 21,608,150 | 19,985,950 | |||||||||||||||
Noninterest-bearing deposits |
6,075,558 | 6,180,814 | 5,866,255 | 6,075,558 | 5,866,255 | |||||||||||||||
Total deposits |
17,439,948 | 17,301,788 | 15,736,694 | 17,439,948 | 15,736,694 | |||||||||||||||
Common shareholders equity |
2,453,561 | 2,430,040 | 2,509,342 | 2,453,561 | 2,509,342 | |||||||||||||||
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AVERAGE BALANCE SHEET DATA |
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Loans |
$ | 14,511,474 | $ | 14,138,904 | $ | 13,102,108 | $ | 14,175,611 | $ | 12,723,409 | ||||||||||
Investment securities (d) |
4,425,546 | 4,143,097 | 3,780,089 | 4,116,270 | 3,810,186 | |||||||||||||||
Earning assets |
19,433,337 | 18,780,771 | 17,324,444 | 18,847,409 | 16,954,320 | |||||||||||||||
Total assets |
21,481,410 | 20,875,090 | 19,549,947 | 20,937,254 | 19,216,585 | |||||||||||||||
Noninterest-bearing deposits |
6,032,680 | 6,107,900 | 5,707,523 | 6,022,034 | 5,571,843 | |||||||||||||||
Total deposits |
17,313,433 | 16,862,088 | 15,371,209 | 16,890,005 | 15,234,018 | |||||||||||||||
Common shareholders equity |
2,439,068 | 2,430,710 | 2,489,948 | 2,439,184 | 2,463,302 | |||||||||||||||
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COMMON SHARE DATA |
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Earnings per share - diluted |
$ | 0.52 | $ | 0.44 | $ | 0.56 | $ | 1.45 | $ | 1.62 | ||||||||||
Operating earnings per share - diluted (b) |
0.52 | 0.51 | 0.59 | 1.57 | 1.76 | |||||||||||||||
Cash dividends per share |
$ | 0.24 | $ | 0.24 | $ | 0.24 | $ | 0.72 | $ | 0.72 | ||||||||||
Book value per share (period-end) |
$ | 31.65 | $ | 31.12 | $ | 30.76 | $ | 31.65 | $ | 30.76 | ||||||||||
Tangible book value per share (period-end) |
22.18 | 21.63 | 21.44 | 22.18 | 21.44 | |||||||||||||||
Weighted average number of shares - diluted |
78,075 | 78,115 | 81,942 | 78,609 | 82,204 | |||||||||||||||
Period-end number of shares |
77,519 | 78,094 | 81,567 | 77,519 | 81,567 | |||||||||||||||
Market data |
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High sales price |
$ | 32.47 | $ | 32.98 | $ | 36.47 | $ | 32.98 | $ | 38.50 | ||||||||||
Low sales price |
25.20 | 28.02 | 31.25 | 24.96 | 31.25 | |||||||||||||||
Period-end closing price |
27.05 | 31.91 | 32.05 | 27.05 | 32.05 | |||||||||||||||
Trading volume |
44,705 | 40,162 | 25,553 | 136,733 | 84,239 | |||||||||||||||
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PERFORMANCE RATIOS |
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Return on average assets |
0.76 | % | 0.67 | % | 0.94 | % | 0.74 | % | 0.94 | % | ||||||||||
Return on average assets - operating (b) |
0.76 | % | 0.78 | % | 1.00 | % | 0.81 | % | 1.03 | % | ||||||||||
Return on average common equity |
6.70 | % | 5.75 | % | 7.42 | % | 6.37 | % | 7.36 | % | ||||||||||
Return on average common equity - operating (b) |
6.70 | % | 6.70 | % | 7.82 | % | 6.93 | % | 8.02 | % | ||||||||||
Return on average tangible common equity |
9.60 | % | 8.28 | % | 10.70 | % | 9.16 | % | 10.72 | % | ||||||||||
Return on average tangible common equity - operating (b) |
9.60 | % | 9.66 | % | 11.28 | % | 9.98 | % | 11.68 | % | ||||||||||
Tangible common equity ratio (e) |
8.24 | % | 8.12 | % | 9.10 | % | 8.24 | % | 9.10 | % | ||||||||||
Net interest margin (TE) (a) |
3.28 | % | 3.30 | % | 3.81 | % | 3.37 | % | 3.95 | % | ||||||||||
Average loan/deposit ratio |
83.82 | % | 83.85 | % | 85.24 | % | 83.93 | % | 83.52 | % | ||||||||||
Efficiency ratio (f) |
65.88 | % | 66.67 | % | 61.84 | % | 65.64 | % | 61.91 | % | ||||||||||
Allowance for loan losses as a percent of period-end loans |
0.95 | % | 0.91 | % | 0.94 | % | 0.95 | % | 0.94 | % | ||||||||||
Annualized net non-FDIC acquired charge-offs to average loans |
0.09 | % | 0.03 | % | 0.19 | % | 0.08 | % | 0.15 | % | ||||||||||
Allowance for loan losses to non-performing loans + accruing loans 90 days past due |
78.15 | % | 100.92 | % | 128.44 | % | 78.15 | % | 128.44 | % | ||||||||||
Noninterest income excluding securities transactions as a percent of total revenue (TE) (a) |
27.32 | % | 28.21 | % | 25.85 | % | 27.13 | % | 25.42 | % | ||||||||||
FTE Total Headcount |
3,863 | 3,825 | 3,787 | 3,863 | 3,787 | |||||||||||||||
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(a) | Tax-equivalent (TE) amounts are calculated using a federal income tax rate of 35%. |
(b) | Net income less tax-effected securities transactions and nonoperating items. Management believes that operating income provides a useful measure of financial performance that helps investors compare the Companys fundamental operations over time. |
(c) | Net interest income (TE) and noninterest income less noninterest expense. Management believes that PTPP profit is a useful financial measure because it enables investors to assess the Companys ability to generate capital to cover credit losses through a credit cycle. |
(d) | Average securities does not include unrealized holding gains/losses on available for sale securities. |
(e) | The tangible common equity ratio is common shareholders equity less intangible assets divided by total assets less intangible assets. |
(f) | The efficiency ratio is noninterest expense to total net interest (TE) and noninterest income, excluding amortization of purchased intangibles, nonoperating items, and securities transactions. |
7
HANCOCK HOLDING COMPANY
QUARTERLY HIGHLIGHTS
(Unaudited)
Three Months Ended | ||||||||||||||||||||
(amounts in thousands, except per share data) |
9/30/2015 | 6/30/2015 | 3/31/2015 | 12/31/2014 | 9/30/2014 | |||||||||||||||
INCOME STATEMENT DATA |
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Net interest income |
$ | 156,830 | $ | 151,791 | $ | 158,158 | $ | 160,813 | $ | 163,541 | ||||||||||
Net interest income (TE) (a) |
160,134 | 154,879 | 161,114 | 163,581 | 166,230 | |||||||||||||||
Provision for loan losses |
10,080 | 6,608 | 6,154 | 9,718 | 9,468 | |||||||||||||||
Noninterest income excluding securities transactions |
60,207 | 60,874 | 56,213 | 56,961 | 57,941 | |||||||||||||||
Securities transactions gains |
4 | | 333 | | | |||||||||||||||
Noninterest expense (excluding nonoperating items) |
151,193 | 149,990 | 146,201 | 144,080 | 145,192 | |||||||||||||||
Nonoperating items |
| 8,927 | 7,314 | 9,667 | 3,887 | |||||||||||||||
Net income |
41,166 | 34,829 | 40,159 | 40,092 | 46,553 | |||||||||||||||
Operating income (b) |
41,166 | 40,631 | 44,697 | 46,376 | 49,079 | |||||||||||||||
Pre-tax, pre-provision (PTPP) profit |
69,152 | 56,836 | 64,145 | 66,795 | 75,092 | |||||||||||||||
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PERIOD-END BALANCE SHEET DATA |
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Loans |
$ | 14,763,050 | $ | 14,344,752 | $ | 13,924,386 | $ | 13,895,276 | $ | 13,348,574 | ||||||||||
Investment securities |
4,548,922 | 4,445,452 | 4,107,904 | 3,826,454 | 3,913,370 | |||||||||||||||
Earning assets |
19,526,150 | 19,409,963 | 18,568,037 | 18,544,930 | 17,748,600 | |||||||||||||||
Total assets |
21,608,150 | 21,538,405 | 20,724,511 | 20,747,266 | 19,985,950 | |||||||||||||||
Noninterest-bearing deposits |
6,075,558 | 6,180,814 | 6,201,403 | 5,945,208 | 5,866,255 | |||||||||||||||
Total deposits |
17,439,948 | 17,301,788 | 16,860,485 | 16,572,831 | 15,736,694 | |||||||||||||||
Common shareholders equity |
2,453,561 | 2,430,040 | 2,425,098 | 2,472,402 | 2,509,342 | |||||||||||||||
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AVERAGE BALANCE SHEET DATA |
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Loans |
$ | 14,511,474 | $ | 14,138,904 | $ | 13,869,397 | $ | 13,578,223 | $ | 13,102,108 | ||||||||||
Investment securities (d) |
4,425,546 | 4,143,097 | 3,772,997 | 3,836,123 | 3,780,089 | |||||||||||||||
Earning assets |
19,433,337 | 18,780,771 | 18,315,839 | 17,911,143 | 17,324,444 | |||||||||||||||
Total assets |
21,481,410 | 20,875,090 | 20,443,859 | 20,090,372 | 19,549,947 | |||||||||||||||
Noninterest-bearing deposits |
6,032,680 | 6,107,900 | 5,924,196 | 5,849,356 | 5,707,523 | |||||||||||||||
Total deposits |
17,313,433 | 16,862,088 | 16,485,259 | 15,892,507 | 15,371,209 | |||||||||||||||
Common shareholders equity |
2,439,068 | 2,430,710 | 2,447,870 | 2,509,509 | 2,489,948 | |||||||||||||||
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COMMON SHARE DATA |
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Earnings per share - diluted |
$ | 0.52 | $ | 0.44 | $ | 0.49 | $ | 0.48 | $ | 0.56 | ||||||||||
Operating earnings per share - diluted (b) |
0.52 | 0.51 | 0.55 | 0.56 | 0.59 | |||||||||||||||
Cash dividends per share |
$ | 0.24 | $ | 0.24 | $ | 0.24 | $ | 0.24 | $ | 0.24 | ||||||||||
Book value per share (period-end) |
$ | 31.65 | $ | 31.12 | $ | 31.14 | $ | 30.74 | $ | 30.76 | ||||||||||
Tangible book value per share (period-end) |
22.18 | 21.63 | 21.55 | 21.37 | 21.44 | |||||||||||||||
Weighted average number of shares - diluted |
78,075 | 78,115 | 79,661 | 81,530 | 81,942 | |||||||||||||||
Period-end number of shares |
77,519 | 78,094 | 77,886 | 80,426 | 81,567 | |||||||||||||||
Market data |
||||||||||||||||||||
High sales price |
$ | 32.47 | $ | 32.98 | $ | 31.13 | $ | 35.67 | $ | 36.47 | ||||||||||
Low sales price |
25.20 | 28.02 | 24.96 | 28.68 | 31.25 | |||||||||||||||
Period-end closing price |
27.05 | 31.91 | 29.86 | 30.70 | 32.05 | |||||||||||||||
Trading volume |
44,705 | 40,162 | 51,866 | 36,396 | 25,553 | |||||||||||||||
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|||||||||||
PERFORMANCE RATIOS |
||||||||||||||||||||
Return on average assets |
0.76 | % | 0.67 | % | 0.80 | % | 0.79 | % | 0.94 | % | ||||||||||
Return on average assets - operating (b) |
0.76 | % | 0.78 | % | 0.89 | % | 0.92 | % | 1.00 | % | ||||||||||
Return on average common equity |
6.70 | % | 5.75 | % | 6.65 | % | 6.34 | % | 7.42 | % | ||||||||||
Return on average common equity - operating (b) |
6.70 | % | 6.70 | % | 7.41 | % | 7.33 | % | 7.82 | % | ||||||||||
Return on average tangible common equity |
9.60 | % | 8.28 | % | 9.60 | % | 9.08 | % | 10.70 | % | ||||||||||
Return on average tangible common equity - operating (b) |
9.60 | % | 9.66 | % | 10.68 | % | 10.50 | % | 11.28 | % | ||||||||||
Tangible common equity ratio (e) |
8.24 | % | 8.12 | % | 8.40 | % | 8.59 | % | 9.10 | % | ||||||||||
Net interest margin (TE) (a) |
3.28 | % | 3.30 | % | 3.55 | % | 3.63 | % | 3.81 | % | ||||||||||
Average loan/deposit ratio |
83.82 | % | 83.85 | % | 84.13 | % | 85.44 | % | 85.24 | % | ||||||||||
Efficiency ratio (f) |
65.88 | % | 66.67 | % | 64.36 | % | 62.41 | % | 61.84 | % | ||||||||||
Allowance for loan losses as a percent of period-end loans |
0.95 | % | 0.91 | % | 0.92 | % | 0.93 | % | 0.94 | % | ||||||||||
Annualized net non-FDIC acquired charge-offs to average loans |
0.09 | % | 0.03 | % | 0.11 | % | 0.08 | % | 0.19 | % | ||||||||||
Allowance for loan losses to non-performing loans + accruing loans 90 days past due |
78.15 | % | 100.92 | % | 123.14 | % | 137.96 | % | 128.44 | % | ||||||||||
Noninterest income excluding securities transactions as a percent of total revenue (TE) (a) |
27.32 | % | 28.21 | % | 25.87 | % | 25.83 | % | 25.85 | % | ||||||||||
FTE headcount |
3,863 | 3,825 | 3,785 | 3,794 | 3,787 | |||||||||||||||
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|
(a) | Tax-equivalent (TE) amounts are calculated using a federal income tax rate of 35%. |
(b) | Net income less tax-effected securities transactions and nonoperating items. Management believes that operating income provides a useful measure of financial performance that helps investors compare the Companys fundamental operations over time. |
(c) | Net interest income (TE) and noninterest income less noninterest expense. Management believes that PTPP profit is a useful financial measure because it enables investors to assess the Companys ability to generate capital to cover credit losses through a credit cycle. |
(d) | Average securities does not include unrealized holding gains/losses on available for sale securities. |
(e) | The tangible common equity ratio is common shareholders equity less intangible assets divided by total assets less intangible assets. |
(f) | The efficiency ratio is noninterest expense to total net interest (TE) and noninterest income, excluding amortization of purchased intangibles, nonoperating items, and securities transactions. |
8
HANCOCK HOLDING COMPANY
INCOME STATEMENT
(Unaudited)
Three Months Ended | Nine Months Ended | |||||||||||||||||||
(dollars in thousands, except per share data) |
9/30/2015 | 6/30/2015 | 9/30/2014 | 9/30/2015 | 9/30/2014 | |||||||||||||||
NET INCOME |
||||||||||||||||||||
Interest income |
$ | 171,329 | $ | 164,920 | $ | 172,701 | $ | 505,336 | $ | 521,842 | ||||||||||
Interest income (TE) |
174,633 | 168,008 | 175,390 | 514,684 | 529,720 | |||||||||||||||
Interest expense |
14,499 | 13,129 | 9,160 | 38,557 | 27,961 | |||||||||||||||
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|
|
|
|
|
|
|
|
|
|||||||||||
Net interest income (TE) |
160,134 | 154,879 | 166,230 | 476,127 | 501,759 | |||||||||||||||
Provision for loan losses |
10,080 | 6,608 | 9,468 | 22,842 | 24,122 | |||||||||||||||
Noninterest income excluding securities transactions |
60,207 | 60,874 | 57,941 | 177,294 | 171,038 | |||||||||||||||
Securities transactions gains |
4 | | | 337 | | |||||||||||||||
Noninterest expense |
151,193 | 158,917 | 149,079 | 463,625 | 452,919 | |||||||||||||||
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|
|
|
|
|
|
|
|||||||||||
Income before income taxes |
55,768 | 47,140 | 62,935 | 157,943 | 187,878 | |||||||||||||||
Income tax expense |
14,602 | 12,311 | 16,382 | 41,789 | 52,248 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net income |
$ | 41,166 | $ | 34,829 | $ | 46,553 | $ | 116,154 | $ | 135,630 | ||||||||||
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|
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|
|||||||||||
ADJUSTMENTS FROM NET TO OPERATING INCOME |
||||||||||||||||||||
Securities transactions gains |
| | | (333 | ) | | ||||||||||||||
Nonoperating items |
||||||||||||||||||||
Impact of insurance business lines divestiture |
| | | | (9,101 | ) | ||||||||||||||
FDIC resolution of denied claims |
| 1,854 | | 1,854 | 10,268 | |||||||||||||||
Nonoperating expense items |
| 7,073 | 3,887 | 14,387 | 11,390 | |||||||||||||||
Early debt redemption |
| | | | 3,461 | |||||||||||||||
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|
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|
|
|
|
|
|
|||||||||||
Total nonoperating items |
| 8,927 | 3,887 | 16,241 | 16,018 | |||||||||||||||
Taxes on adjustments at marginal tax rate |
| 3,125 | 1,361 | 5,568 | 3,879 | |||||||||||||||
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|
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|
|
|
|
|
|
|||||||||||
Total adjustments (net of taxes) |
| 5,802 | 2,526 | 10,340 | 12,139 | |||||||||||||||
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|
|||||||||||
Operating income (g) |
$ | 41,166 | $ | 40,631 | $ | 49,079 | $ | 126,494 | $ | 147,769 | ||||||||||
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|
|||||||||||
ADJUSTMENTS FROM NET INCOME TO PTPP PROFIT |
||||||||||||||||||||
Difference between interest income and interest income (TE) |
3,304 | 3,088 | 2,689 | 9,348 | 7,878 | |||||||||||||||
Provision for loan losses |
10,080 | 6,608 | 9,468 | 22,842 | 24,122 | |||||||||||||||
Income tax expense |
14,602 | 12,311 | 16,382 | 41,789 | 52,248 | |||||||||||||||
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|
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|
|||||||||||
Pre-tax, pre-provision (PTPP) profit (TE) (h) |
$ | 69,152 | $ | 56,836 | $ | 75,092 | $ | 190,133 | $ | 219,878 | ||||||||||
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NONINTEREST INCOME AND NONINTEREST EXPENSE |
||||||||||||||||||||
Service charges on deposit accounts |
$ | 18,619 | $ | 17,908 | $ | 20,000 | $ | 53,842 | $ | 57,981 | ||||||||||
Trust fees |
11,345 | 11,795 | 11,530 | 34,340 | 33,267 | |||||||||||||||
Bank card and ATM fees |
11,637 | 11,868 | 11,641 | 34,688 | 33,806 | |||||||||||||||
Investment & annuity fees |
6,149 | 4,838 | 5,506 | 16,037 | 15,555 | |||||||||||||||
Secondary mortgage market operations |
3,413 | 3,618 | 2,313 | 9,695 | 6,036 | |||||||||||||||
Insurance commissions and fees |
2,238 | 2,595 | 1,979 | 6,587 | 7,611 | |||||||||||||||
Amortization of FDIC loss share receivable |
(1,564 | ) | (1,273 | ) | (2,760 | ) | (4,034 | ) | (9,989 | ) | ||||||||||
Other income |
8,370 | 9,525 | 7,732 | 26,139 | 26,771 | |||||||||||||||
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|
|||||||||||
Noninterest income excluding securities transactions |
60,207 | 60,874 | 57,941 | 177,294 | 171,038 | |||||||||||||||
Securities transactions gains |
4 | | | 337 | | |||||||||||||||
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|
|
|
|
|
|
|
|
|||||||||||
Total noninterest income including securities transactions |
$ | 60,211 | $ | 60,874 | $ | 57,941 | $ | 177,631 | $ | 171,038 | ||||||||||
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|||||||||||
Personnel expense |
$ | 84,155 | $ | 82,533 | $ | 80,043 | $ | 246,805 | $ | 240,981 | ||||||||||
Net occupancy expense |
11,222 | 11,765 | 10,799 | 34,149 | 32,905 | |||||||||||||||
Equipment expense |
3,598 | 4,079 | 4,542 | 11,610 | 12,875 | |||||||||||||||
Other real estate expense, net |
422 | 501 | (104 | ) | 1,379 | 1,757 | ||||||||||||||
Other operating expense |
45,769 | 44,964 | 43,342 | 134,948 | 128,031 | |||||||||||||||
Amortization of intangibles |
6,027 | 6,148 | 6,570 | 18,493 | 20,352 | |||||||||||||||
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|
|
|
|
|
|||||||||||
Total operating expense |
151,193 | 149,990 | 145,192 | 447,384 | 436,901 | |||||||||||||||
Nonoperating expense items |
| 8,927 | 3,887 | 16,241 | 16,018 | |||||||||||||||
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|
|
|
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|
|
|
|||||||||||
Total noninterest expense |
$ | 151,193 | $ | 158,917 | $ | 149,079 | $ | 463,625 | $ | 452,919 | ||||||||||
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|||||||||||
COMMON SHARE DATA |
||||||||||||||||||||
Earnings per share: |
||||||||||||||||||||
Basic |
$ | 0.52 | $ | 0.44 | $ | 0.56 | $ | 1.45 | $ | 1.62 | ||||||||||
Diluted |
0.52 | 0.44 | 0.56 | 1.45 | 1.62 | |||||||||||||||
Operating earnings per share: (g) |
||||||||||||||||||||
Basic |
$ | 0.52 | $ | 0.51 | $ | 0.59 | $ | 1.58 | $ | 1.77 | ||||||||||
Diluted |
0.52 | 0.51 | 0.59 | 1.57 | 1.76 | |||||||||||||||
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|
|
|
|
|
|
|
|
(g) | Net income less tax-effected securities transactions and nonoperating items. Management believes that operating income provides a useful measure of financial performance that helps investors compare the Companys fundamental operations over time. |
(h) | Net interest income (TE) and noninterest income less noninterest expense. Management believes that PTPP profit is a useful financial measure because it enables investors to assess the Companys ability to generate capital to cover credit losses through a credit cycle. |
9
HANCOCK HOLDING COMPANY
INCOME STATEMENT
(Unaudited)
Three months ended | ||||||||||||||||||||
(dollars in thousands) |
9/30/2015 | 6/30/2015 | 3/31/2015 | 12/31/2014 | 9/30/2014 | |||||||||||||||
Interest income |
$ | 171,329 | $ | 164,920 | $ | 169,087 | $ | 170,971 | $ | 172,701 | ||||||||||
Interest income (TE) |
174,633 | 168,008 | 172,043 | 173,739 | 175,390 | |||||||||||||||
Interest expense |
14,499 | 13,129 | 10,929 | 10,158 | 9,160 | |||||||||||||||
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|
|
|
|
|
|
|
|
|
|||||||||||
Net interest income (TE) |
160,134 | 154,879 | 161,114 | 163,581 | 166,230 | |||||||||||||||
Provision for loan losses |
10,080 | 6,608 | 6,154 | 9,718 | 9,468 | |||||||||||||||
Noninterest income excluding securities transactions |
60,207 | 60,874 | 56,213 | 56,961 | 57,941 | |||||||||||||||
Securities transactions gains |
4 | | 333 | | | |||||||||||||||
Noninterest expense |
151,193 | 158,917 | 153,515 | 153,747 | 149,079 | |||||||||||||||
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|
|
|
|
|
|
|
|
|
|||||||||||
Income before income taxes |
55,768 | 47,140 | 55,035 | 54,309 | 62,935 | |||||||||||||||
Income tax expense |
14,602 | 12,311 | 14,876 | 14,217 | 16,382 | |||||||||||||||
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|
|
|
|
|
|
|
|
|
|||||||||||
Net income |
$ | 41,166 | $ | 34,829 | $ | 40,159 | $ | 40,092 | $ | 46,553 | ||||||||||
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|
|
|
|
|
|
|||||||||||
ADJUSTMENTS FROM NET TO OPERATING INCOME |
||||||||||||||||||||
Securities transactions gains |
| | (333 | ) | | | ||||||||||||||
Nonoperating expense |
| 8,927 | 7,314 | 9,667 | 3,887 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total nonoperating items |
| 8,927 | 6,981 | 9,667 | 3,887 | |||||||||||||||
Taxes on adjustments at marginal tax rate |
| 3,125 | 2,443 | 3,383 | 1,361 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Adjustments (net of taxes) |
| 5,802 | 4,538 | 6,284 | 2,526 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Operating income (g) |
$ | 41,166 | $ | 40,631 | $ | 44,697 | $ | 46,376 | $ | 49,079 | ||||||||||
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|
|
|
|
|
|
|
|||||||||||
Pre-tax, pre-provision (PTPP) profit (TE) (h) |
$ | 69,152 | $ | 56,836 | $ | 64,145 | $ | 66,795 | $ | 75,092 | ||||||||||
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|
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|
|||||||||||
NONINTEREST INCOME AND NONINTEREST EXPENSE |
||||||||||||||||||||
Service charges on deposit accounts |
$ | 18,619 | $ | 17,908 | $ | 17,315 | $ | 19,025 | $ | 20,000 | ||||||||||
Trust fees |
11,345 | 11,795 | 11,200 | 11,559 | 11,530 | |||||||||||||||
Bank card and ATM fees |
11,637 | 11,868 | 11,183 | 11,225 | 11,641 | |||||||||||||||
Investment & annuity fees |
6,149 | 4,838 | 5,050 | 4,736 | 5,506 | |||||||||||||||
Secondary mortgage market operations |
3,413 | 3,618 | 2,664 | 2,000 | 2,313 | |||||||||||||||
Insurance commissions and fees |
2,238 | 2,595 | 1,754 | 1,862 | 1,979 | |||||||||||||||
Amortization of FDIC loss share receivable |
(1,564 | ) | (1,273 | ) | (1,197 | ) | (2,113 | ) | (2,760 | ) | ||||||||||
Other income |
8,370 | 9,525 | 8,244 | 8,667 | 7,732 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Noninterest income excluding securities transactions |
60,207 | 60,874 | 56,213 | 56,961 | 57,941 | |||||||||||||||
Securities transactions gains |
4 | | 333 | | | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total noninterest income including securities transactions |
$ | 60,211 | $ | 60,874 | $ | 56,546 | $ | 56,961 | $ | 57,941 | ||||||||||
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|
|
|
|
|
|
|
|
|||||||||||
Personnel expense |
$ | 84,155 | $ | 82,533 | $ | 80,117 | $ | 79,522 | $ | 80,043 | ||||||||||
Net occupancy expense |
11,222 | 11,765 | 11,162 | 10,571 | 10,799 | |||||||||||||||
Equipment expense |
3,598 | 4,079 | 3,933 | 3,986 | 4,542 | |||||||||||||||
Other real estate expense, net |
422 | 501 | 456 | 1,001 | (104 | ) | ||||||||||||||
Other operating expense |
45,769 | 44,964 | 44,215 | 42,555 | 43,342 | |||||||||||||||
Amortization of intangibles |
6,027 | 6,148 | 6,318 | 6,445 | 6,570 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total operating expense |
151,193 | 149,990 | 146,201 | 144,080 | 145,192 | |||||||||||||||
Nonoperating expense items |
| 8,927 | 7,314 | 9,667 | 3,887 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total noninterest expense |
$ | 151,193 | $ | 158,917 | $ | 153,515 | $ | 153,747 | $ | 149,079 | ||||||||||
|
|
|
|
|
|
|
|
|
|
(g) | Net income less tax-effected securities transactions and nonoperating items. Management believes that operating income provides a useful measure of financial performance that helps investors compare the Companys fundamental operations over time. |
(h) | Net interest income (TE) and noninterest income less noninterest expense. Management believes that PTPP profit is a useful financial measure because it enables investors to assess the Companys ability to generate capital to cover credit losses through a credit cycle. |
10
HANCOCK HOLDING COMPANY
PERIOD-END BALANCE SHEET
(Unaudited)
Three Months Ended | ||||||||||||||||||||
(dollars in thousands) |
9/30/2015 | 6/30/2015 | 3/31/2015 | 12/31/2014 | 9/30/2014 | |||||||||||||||
ASSETS |
||||||||||||||||||||
Commercial non-real estate loans |
$ | 6,345,994 | $ | 6,185,684 | $ | 5,987,084 | $ | 6,044,060 | $ | 5,587,137 | ||||||||||
Construction and land development loans |
1,085,585 | 1,120,947 | 1,113,510 | 1,106,761 | 1,095,902 | |||||||||||||||
Commercial real estate loans |
3,327,386 | 3,212,833 | 3,150,103 | 3,144,048 | 3,100,834 | |||||||||||||||
Residential mortgage loans |
2,013,789 | 1,955,837 | 1,913,885 | 1,894,181 | 1,858,490 | |||||||||||||||
Consumer loans |
1,990,296 | 1,869,451 | 1,759,804 | 1,706,226 | 1,706,211 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total loans |
14,763,050 | 14,344,752 | 13,924,386 | 13,895,276 | 13,348,574 | |||||||||||||||
Loans held for sale |
19,764 | 21,304 | 19,950 | 20,252 | 15,098 | |||||||||||||||
Securities |
4,548,922 | 4,445,452 | 4,107,904 | 3,826,454 | 3,913,370 | |||||||||||||||
Short-term investments |
194,414 | 598,455 | 515,797 | 802,948 | 471,558 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Earning assets |
19,526,150 | 19,409,963 | 18,568,037 | 18,544,930 | 17,748,600 | |||||||||||||||
Allowance for loan losses |
(139,576 | ) | (131,087 | ) | (128,386 | ) | (128,762 | ) | (125,572 | ) | ||||||||||
Goodwill |
621,193 | 621,193 | 621,193 | 621,193 | 621,193 | |||||||||||||||
Other intangible assets, net |
113,229 | 119,256 | 125,404 | 132,810 | 139,256 | |||||||||||||||
Other assets |
1,487,154 | 1,519,080 | 1,538,263 | 1,577,095 | 1,602,473 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total assets |
$ | 21,608,150 | $ | 21,538,405 | $ | 20,724,511 | $ | 20,747,266 | $ | 19,985,950 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
LIABILITIES |
||||||||||||||||||||
Noninterest-bearing deposits |
$ | 6,075,558 | $ | 6,180,814 | $ | 6,201,403 | $ | 5,945,208 | $ | 5,866,255 | ||||||||||
Interest-bearing transaction and savings deposits |
7,360,677 | 6,994,603 | 6,576,658 | 6,531,628 | 6,325,671 | |||||||||||||||
Interest-bearing public fund deposits |
1,768,133 | 1,962,589 | 1,828,559 | 1,982,616 | 1,534,678 | |||||||||||||||
Time deposits |
2,235,580 | 2,163,782 | 2,253,865 | 2,113,379 | 2,010,090 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total interest-bearing deposits |
11,364,390 | 11,120,974 | 10,659,082 | 10,627,623 | 9,870,439 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total deposits |
17,439,948 | 17,301,788 | 16,860,485 | 16,572,831 | 15,736,694 | |||||||||||||||
Short-term borrowings |
1,049,182 | 1,079,193 | 755,250 | 1,151,573 | 1,171,809 | |||||||||||||||
Long-term debt |
497,177 | 507,341 | 516,007 | 374,371 | 376,452 | |||||||||||||||
Other liabilities |
168,282 | 220,043 | 167,671 | 176,089 | 191,653 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total liabilities |
19,154,589 | 19,108,365 | 18,299,413 | 18,274,864 | 17,476,608 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
COMMON SHAREHOLDERS EQUITY |
||||||||||||||||||||
Common stock net of treasury and capital surplus |
1,717,959 | 1,730,344 | 1,726,736 | 1,798,980 | 1,832,529 | |||||||||||||||
Retained earnings |
781,769 | 759,780 | 744,131 | 723,497 | 703,506 | |||||||||||||||
Accumulated other comprehensive income |
(46,167 | ) | (60,084 | ) | (45,769 | ) | (50,075 | ) | (26,693 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total common shareholders equity |
2,453,561 | 2,430,040 | 2,425,098 | 2,472,402 | 2,509,342 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total liabilities & shareholders equity |
$ | 21,608,150 | $ | 21,538,405 | $ | 20,724,511 | $ | 20,747,266 | $ | 19,985,950 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
CAPITAL RATIOS |
||||||||||||||||||||
Tangible common equity |
$ | 1,719,108 | $ | 1,689,550 | $ | 1,678,453 | $ | 1,718,343 | $ | 1,748,828 | ||||||||||
Tier 1 capital (i) |
1,849,384 | 1,837,369 | 1,812,010 | 1,777,348 | 1,784,588 | |||||||||||||||
Common equity (period-end) as a percent of total assets (period-end) |
11.35 | % | 11.28 | % | 11.70 | % | 11.92 | % | 12.56 | % | ||||||||||
Tangible common equity ratio |
8.24 | % | 8.12 | % | 8.40 | % | 8.59 | % | 9.10 | % | ||||||||||
Leverage (Tier 1) ratio (i) |
8.86 | % | 9.07 | % | 9.17 | % | 9.17 | % | 9.48 | % | ||||||||||
Tier 1 risk-based capital ratio (i) |
10.60 | % | 10.77 | % | 10.86 | % | 11.23 | % | 11.59 | % | ||||||||||
Total risk-based capital ratio (i) |
12.38 | % | 12.53 | % | 12.77 | % | 12.30 | % | 12.66 | % | ||||||||||
|
|
|
|
|
|
|
|
|
|
(i) | Estimated for most recent period-end. Regulatory ratios reflect the impact of Basel III capital requirements effective January 1, 2015. |
11
HANCOCK HOLDING COMPANY
AVERAGE BALANCE SHEET
(Unaudited)
Three Months Ended | Nine Months Ended | |||||||||||||||||||
(dollars in thousands) |
9/30/2015 | 6/30/2015 | 9/30/2014 | 9/30/2015 | 9/30/2014 | |||||||||||||||
ASSETS |
||||||||||||||||||||
Commercial non-real estate loans |
$ | 6,261,241 | $ | 6,095,054 | $ | 5,485,982 | $ | 6,118,300 | $ | 5,292,464 | ||||||||||
Construction and land development loans |
1,115,406 | 1,084,540 | 1,070,763 | 1,106,981 | 1,010,136 | |||||||||||||||
Commercial real estate loans |
3,231,597 | 3,218,914 | 3,070,821 | 3,190,092 | 3,058,804 | |||||||||||||||
Residential mortgage loans |
1,977,990 | 1,930,553 | 1,814,186 | 1,937,414 | 1,760,056 | |||||||||||||||
Consumer loans |
1,925,240 | 1,809,843 | 1,660,356 | 1,822,824 | 1,601,949 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total loans |
14,511,474 | 14,138,904 | 13,102,108 | 14,175,611 | 12,723,409 | |||||||||||||||
Loans held for sale |
17,233 | 22,883 | 16,885 | 18,567 | 16,916 | |||||||||||||||
Securities (j) |
4,425,546 | 4,143,097 | 3,780,089 | 4,116,270 | 3,810,186 | |||||||||||||||
Short-term investments |
479,084 | 475,887 | 425,362 | 536,961 | 403,809 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Earning assets |
19,433,337 | 18,780,771 | 17,324,444 | 18,847,409 | 16,954,320 | |||||||||||||||
Allowance for loan losses |
(132,634 | ) | (130,124 | ) | (129,734 | ) | (131,001 | ) | (130,412 | ) | ||||||||||
Goodwill and other intangible assets |
737,361 | 743,435 | 763,652 | 743,785 | 771,728 | |||||||||||||||
Other assets |
1,443,346 | 1,481,008 | 1,591,585 | 1,477,061 | 1,620,949 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total assets |
$ | 21,481,410 | $ | 20,875,090 | $ | 19,549,947 | $ | 20,937,254 | $ | 19,216,585 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
LIABILITIES AND SHAREHOLDERS EQUITY |
||||||||||||||||||||
Noninterest-bearing deposits |
$ | 6,032,680 | $ | 6,107,900 | $ | 5,707,523 | $ | 6,022,034 | $ | 5,571,843 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Interest-bearing transaction and savings deposits |
7,270,061 | 6,656,911 | 6,160,911 | 6,814,057 | 6,104,039 | |||||||||||||||
Interest-bearing public fund deposits |
1,838,952 | 1,890,364 | 1,547,513 | 1,848,340 | 1,508,222 | |||||||||||||||
Time deposits |
2,171,740 | 2,206,913 | 1,955,262 | 2,205,574 | 2,049,914 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total interest-bearing deposits |
11,280,753 | 10,754,188 | 9,663,686 | 10,867,971 | 9,662,175 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total deposits |
17,313,433 | 16,862,088 | 15,371,209 | 16,890,005 | 15,234,018 | |||||||||||||||
Short-term borrowings |
1,050,801 | 896,014 | 1,139,694 | 956,228 | 962,014 | |||||||||||||||
Long-term debt |
504,544 | 515,997 | 375,914 | 478,162 | 380,660 | |||||||||||||||
Other liabilities |
173,564 | 170,281 | 173,182 | 173,675 | 176,591 | |||||||||||||||
Common shareholders equity |
2,439,068 | 2,430,710 | 2,489,948 | 2,439,184 | 2,463,302 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total liabilities & shareholders equity |
$ | 21,481,410 | $ | 20,875,090 | $ | 19,549,947 | $ | 20,937,254 | $ | 19,216,585 | ||||||||||
|
|
|
|
|
|
|
|
|
|
(j) | Average securities does not include unrealized holding gains/losses on available for sale securities. |
12
HANCOCK HOLDING COMPANY
AVERAGE BALANCE AND NET INTEREST MARGIN SUMMARY
(Unaudited)
Three Months Ended | ||||||||||||||||||||||||||||||||||||
9/30/2015 | 6/30/2015 | 9/30/2014 | ||||||||||||||||||||||||||||||||||
(dollars in millions) |
Volume | Interest | Rate | Volume | Interest | Rate | Volume | Interest | Rate | |||||||||||||||||||||||||||
AVERAGE EARNING ASSETS |
||||||||||||||||||||||||||||||||||||
Commercial & real estate loans (TE) (l) (m) |
$ | 10,608.2 | $ | 104.4 | 3.91 | % | $ | 10,398.5 | $ | 101.6 | 3.92 | % | $ | 9,627.6 | $ | 108.2 | 4.46 | % | ||||||||||||||||||
Residential mortgage loans |
1,978.0 | 20.2 | 4.08 | % | 1,930.6 | 19.9 | 4.13 | % | 1,814.2 | 20.0 | 4.41 | % | ||||||||||||||||||||||||
Consumer loans |
1,925.3 | 24.5 | 5.04 | % | 1,809.8 | 23.0 | 5.10 | % | 1,660.4 | 24.0 | 5.74 | % | ||||||||||||||||||||||||
Loan fees & late charges |
| 0.1 | 0.00 | % | | | 0.00 | % | | 0.4 | 0.00 | % | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Total loans (TE) |
14,511.5 | 149.2 | 4.09 | % | 14,138.9 | 144.5 | 4.10 | % | 13,102.2 | 152.6 | 4.63 | % | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Loans held for sale |
17.2 | 0.2 | 4.07 | % | 22.9 | 0.2 | 3.88 | % | 16.9 | 0.1 | 4.66 | % | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
US Treasury and government agency securities |
166.8 | 0.6 | 1.55 | % | 300.0 | 1.2 | 1.54 | % | 184.8 | 0.7 | 1.47 | % | ||||||||||||||||||||||||
CMOs and mortgage backed securities |
4,052.0 | 22.0 | 2.17 | % | 3,641.6 | 19.6 | 2.15 | % | 3,379.2 | 19.2 | 2.27 | % | ||||||||||||||||||||||||
Municipals (TE) (l) |
200.3 | 2.3 | 4.52 | % | 195.5 | 2.2 | 4.54 | % | 203.7 | 2.4 | 4.62 | % | ||||||||||||||||||||||||
Other securities |
6.4 | 0.0 | 1.59 | % | 6.0 | 0.0 | 1.61 | % | 12.3 | 0.1 | 2.21 | % | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Total securities (TE) (k) |
4,425.5 | 24.9 | 2.25 | % | 4,143.1 | 23.0 | 2.22 | % | 3,780.0 | 22.4 | 2.36 | % | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Total short-term investments |
479.1 | 0.3 | 0.24 | % | 475.9 | 0.3 | 0.23 | % | 425.3 | 0.3 | 0.23 | % | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Average earning assets yield (TE) |
$ | 19,433.3 | 174.6 | 3.57 | % | $ | 18,780.8 | 168.0 | 3.58 | % | $ | 17,324.4 | 175.4 | 4.02 | % | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
INTEREST-BEARING LIABILITIES |
||||||||||||||||||||||||||||||||||||
Interest-bearing transaction and savings deposits |
$ | 7,270.1 | 3.7 | 0.20 | % | $ | 6,656.9 | 2.5 | 0.15 | % | $ | 6,160.9 | 1.6 | 0.11 | % | |||||||||||||||||||||
Time deposits |
2,171.7 | 3.8 | 0.70 | % | 2,206.9 | 3.8 | 0.69 | % | 1,955.3 | 3.1 | 0.64 | % | ||||||||||||||||||||||||
Public funds |
1,839.0 | 1.4 | 0.31 | % | 1,890.4 | 1.3 | 0.28 | % | 1,547.5 | 1.1 | 0.27 | % | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Total interest-bearing deposits |
11,280.8 | 8.9 | 0.31 | % | 10,754.2 | 7.6 | 0.28 | % | 9,663.7 | 5.8 | 0.24 | % | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Short-term borrowings |
1,050.8 | 0.3 | 0.10 | % | 896.0 | 0.2 | 0.08 | % | 1,139.7 | 0.2 | 0.08 | % | ||||||||||||||||||||||||
Long-term debt |
504.5 | 5.3 | 4.16 | % | 516.0 | 5.3 | 4.14 | % | 375.9 | 3.2 | 3.27 | % | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Total borrowings |
1,555.3 | 5.6 | 1.42 | % | 1,412.0 | 5.5 | 1.56 | % | 1,515.6 | 3.4 | 0.87 | % | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Total interest-bearing liabilities cost |
12,836.1 | 14.5 | 0.45 | % | 12,166.2 | 13.1 | 0.43 | % | 11,179.3 | 9.2 | 0.33 | % | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Net interest-free funding sources |
6,597.2 | 6,614.6 | 6,145.1 | |||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Total cost of funds |
19,433.3 | 14.5 | 0.30 | % | 18,780.8 | 13.1 | 0.28 | % | 17,324.4 | 9.2 | 0.21 | % | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Net Interest Spread (TE) |
$ | 160.1 | 3.13 | % | $ | 154.9 | 3.15 | % | $ | 166.2 | 3.69 | % | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Net Interest Margin (TE) |
$ | 19,433.3 | $ | 160.1 | 3.28 | % | $ | 18,780.8 | $ | 154.9 | 3.30 | % | $ | 17,324.4 | $ | 166.2 | 3.81 | % | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(k) | Average securities does not include unrealized holding gains/losses on available for sale securities. |
(l) | Tax equivalent (te) amounts are calculated using a marginal federal tax rate of 35%. |
(m) | Includes nonaccrual loans. |
13
HANCOCK HOLDING COMPANY
AVERAGE BALANCE AND NET INTEREST MARGIN SUMMARY
(Unaudited)
Nine Months Ended | ||||||||||||||||||||||||
9/30/2015 | 9/30/2014 | |||||||||||||||||||||||
(dollars in millions) |
Volume | Interest | Rate | Volume | Interest | Rate | ||||||||||||||||||
AVERAGE EARNING ASSETS |
||||||||||||||||||||||||
Commercial & real estate loans (TE) (l) (m) |
$ | 10,415.4 | $ | 312.8 | 4.01 | % | $ | 9,361.4 | $ | 324.4 | 4.63 | % | ||||||||||||
Residential mortgage loans |
1,937.4 | 60.6 | 4.17 | % | 1,760.1 | 62.4 | 4.73 | % | ||||||||||||||||
Consumer loans |
1,822.8 | 69.5 | 5.10 | % | 1,601.9 | 70.8 | 5.91 | % | ||||||||||||||||
Loan fees & late charges |
| 0.4 | 0.00 | % | | 1.9 | 0.00 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total loans (TE) |
14,175.6 | 443.3 | 4.18 | % | 12,723.4 | 459.5 | 4.82 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Loans held for sale |
18.6 | 0.5 | 3.54 | % | 16.9 | 0.5 | 4.29 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
US Treasury and government agency securities |
246.9 | 2.9 | 1.56 | % | 93.1 | 1.2 | 1.73 | % | ||||||||||||||||
CMOs and mortgage backed securities |
3,664.2 | 60.2 | 2.19 | % | 3,493.5 | 60.5 | 2.31 | % | ||||||||||||||||
Municipals (TE) (l) |
197.2 | 6.7 | 4.56 | % | 208.8 | 7.2 | 4.60 | % | ||||||||||||||||
Other securities |
8.0 | 0.2 | 3.00 | % | 14.8 | 0.2 | 2.22 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total securities (TE) (k) |
4,116.3 | 70.0 | 2.27 | % | 3,810.2 | 69.1 | 2.42 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total short-term investments |
537.0 | 0.9 | 0.23 | % | 403.8 | 0.7 | 0.23 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Average earning assets yield (TE) |
$ | 18,847.5 | 514.7 | 3.65 | % | $ | 16,954.3 | 529.8 | 4.17 | % | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
INTEREST-BEARING LIABILITIES |
||||||||||||||||||||||||
Interest-bearing transaction and savings deposits |
$ | 6,814.1 | 8.4 | 0.16 | % | $ | 6,104.0 | 4.6 | 0.10 | % | ||||||||||||||
Time deposits |
2,205.6 | 11.3 | 0.68 | % | 2,049.9 | 9.3 | 0.60 | % | ||||||||||||||||
Public funds |
1,848.3 | 4.0 | 0.29 | % | 1,508.2 | 2.5 | 0.23 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total interest-bearing deposits |
10,868.0 | 23.7 | 0.29 | % | 9,662.1 | 16.4 | 0.23 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Short-term borrowings |
956.2 | 0.6 | 0.09 | % | 962.0 | 2.1 | 0.29 | % | ||||||||||||||||
Long-term debt |
478.2 | 14.2 | 3.98 | % | 380.7 | 9.4 | 3.31 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total borrowings |
1,434.4 | 14.8 | 1.39 | % | 1,342.7 | 11.5 | 1.15 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total interest-bearing liabilities cost |
12,302.4 | 38.5 | 0.42 | % | 11,004.8 | 27.9 | 0.34 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net interest-free funding sources |
6,545.1 | 5,949.5 | ||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total cost of funds |
18,847.5 | 38.5 | 0.28 | % | 16,954.3 | 27.9 | 0.22 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net Interest Spread (TE) |
$ | 476.2 | 3.23 | % | $ | 501.9 | 3.83 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net Interest Margin (TE) |
$ | 18,847.5 | $ | 476.2 | 3.37 | % | $ | 16,954.3 | $ | 501.9 | 3.95 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
(k) | Average securities does not include unrealized holding gains/losses on available for sale securities. |
(l) | Tax equivalent (te) amounts are calculated using a marginal federal tax rate of 35%. |
(m) | Includes nonaccrual loans. |
14
HANCOCK HOLDING COMPANY
ASSET QUALITY INFORMATION
(Unaudited)
Three Months Ended | Nine Months Ended | |||||||||||||||||||
(dollars in thousands) |
9/30/2015 | 6/30/2015 | 9/30/2014 | 9/30/2015 | 9/30/2014 | |||||||||||||||
Nonaccrual loans (n) |
$ | 166,945 | $ | 118,445 | $ | 83,154 | $ | 166,945 | $ | 83,154 | ||||||||||
Restructured loans - still accruing |
5,779 | 7,966 | 7,944 | 5,779 | 7,944 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total nonperforming loans |
172,724 | 126,411 | 91,098 | 172,724 | 91,098 | |||||||||||||||
ORE and foreclosed assets |
33,599 | 38,630 | 56,081 | 33,599 | 56,081 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total nonperforming assets |
$ | 206,323 | $ | 165,041 | $ | 147,179 | $ | 206,323 | $ | 147,179 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Nonperforming assets as a percent of loans, ORE and foreclosed assets |
1.39 | % | 1.15 | % | 1.10 | % | 1.39 | % | 1.10 | % | ||||||||||
Accruing loans 90 days past due |
$ | 5,876 | $ | 3,478 | $ | 6,667 | $ | 5,876 | $ | 6,667 | ||||||||||
Accruing loans 90 days past due as a percent of loans |
0.04 | % | 0.02 | % | 0.05 | % | 0.04 | % | 0.05 | % | ||||||||||
Nonperforming assets + accruing loans 90 days past due to loans, ORE and foreclosed assets |
1.43 | % | 1.17 | % | 1.15 | % | 1.43 | % | 1.15 | % | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
ALLOWANCE FOR LOAN LOSSES |
||||||||||||||||||||
Beginning Balance |
$ | 131,087 | $ | 128,386 | $ | 128,672 | $ | 128,762 | $ | 133,626 | ||||||||||
Net provision for loan losses - FDIC acquired loans |
(437 | ) | (879 | ) | (391 | ) | (1,386 | ) | (766 | ) | ||||||||||
Provision for loan losses - non-FDIC acquired loans |
10,517 | 7,487 | 9,859 | 24,228 | 24,888 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net provision for loan losses |
10,080 | 6,608 | 9,468 | 22,842 | 24,122 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
(Decrease) increase in FDIC loss share receivable |
552 | (2,115 | ) | (6,695 | ) | (1,984 | ) | (14,570 | ) | |||||||||||
Net charge-offs - FDIC acquired |
(1,328 | ) | 582 | (566 | ) | 1,709 | 3,125 | |||||||||||||
Charge-offs - non-FDIC acquired |
5,972 | 4,129 | 8,482 | 17,561 | 23,273 | |||||||||||||||
Recoveries - non-FDIC acquired |
(2,501 | ) | (2,919 | ) | (2,043 | ) | (9,226 | ) | (8,792 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net charge-offs |
2,143 | 1,792 | 5,873 | 10,044 | 17,606 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Ending Balance |
$ | 139,576 | $ | 131,087 | $ | 125,572 | $ | 139,576 | $ | 125,572 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Allowance for loan losses as a percent of period-end loans |
0.95 | % | 0.91 | % | 0.94 | % | 0.95 | % | 0.94 | % | ||||||||||
Allowance for loan losses to nonperforming loans + accruing loans 90 days past due |
78.15 | % | 100.92 | % | 128.44 | % | 78.15 | % | 128.44 | % | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
NET CHARGE-OFF INFORMATION |
||||||||||||||||||||
Net charge-offs - non-FDIC acquired: |
||||||||||||||||||||
Commercial & real estate loans |
$ | 666 | ($ | 691 | ) | $ | 2,451 | $ | 449 | $ | 4,991 | |||||||||
Residential mortgage loans |
30 | (61 | ) | 558 | 873 | 1,292 | ||||||||||||||
Consumer loans |
2,775 | 1,962 | 3,430 | 7,013 | 8,198 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total net charge-offs - non-FDIC acquired |
$ | 3,471 | $ | 1,210 | $ | 6,439 | $ | 8,335 | $ | 14,481 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net charge-offs - non-FDIC acquired to average loans: |
||||||||||||||||||||
Commercial & real estate loans |
0.02 | % | (0.03 | )% | 0.10 | % | 0.01 | % | 0.07 | % | ||||||||||
Residential mortgage loans |
0.01 | % | (0.01 | )% | 0.12 | % | 0.06 | % | 0.10 | % | ||||||||||
Consumer loans |
0.57 | % | 0.43 | % | 0.82 | % | 0.51 | % | 0.68 | % | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total net charge-offs - non-FDIC acquired to average loans |
0.09 | % | 0.03 | % | 0.19 | % | 0.08 | % | 0.15 | % | ||||||||||
|
|
|
|
|
|
|
|
|
|
(n) | Nonaccrual loans and accruing loans past due 90 days or more do not include acquired credit-impaired loans which were written down to fair value upon acquisition and accrete interest income over the remaining life of the loan. Included in nonaccrual loans are $4.9 million, $4.9 million, and $9.9 million at 9/30/15, 6/30/15 and 9/30/14, respectively, in nonaccruing restructured loans. |
15
HANCOCK HOLDING COMPANY
ASSET QUALITY INFORMATION
(Unaudited)
Three months ended | ||||||||||||||||||||
(dollars in thousands) |
9/30/2015 | 6/30/2015 | 3/31/2015 | 12/31/2014 | 9/30/2014 | |||||||||||||||
Nonaccrual loans (n) |
$ | 166,945 | $ | 118,445 | $ | 90,821 | $ | 79,537 | $ | 83,154 | ||||||||||
Restructured loans - still accruing |
5,779 | 7,966 | 7,564 | 8,971 | 7,944 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total nonperforming loans |
172,724 | 126,411 | 98,385 | 88,508 | 91,098 | |||||||||||||||
ORE and foreclosed assets |
33,599 | 38,630 | 42,956 | 59,569 | 56,081 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total nonperforming assets |
$ | 206,323 | $ | 165,041 | $ | 141,341 | $ | 148,077 | $ | 147,179 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Nonperforming assets as a percent of loans, ORE and foreclosed assets |
1.39 | % | 1.15 | % | 1.01 | % | 1.06 | % | 1.10 | % | ||||||||||
Accruing loans 90 days past due |
$ | 5,876 | $ | 3,478 | $ | 5,872 | $ | 4,825 | $ | 6,667 | ||||||||||
Accruing loans 90 days past due as a percent of loans |
0.04 | % | 0.02 | % | 0.04 | % | 0.03 | % | 0.05 | % | ||||||||||
Nonperforming assets + accruing loans 90 days past due to loans, ORE and foreclosed assets |
1.43 | % | 1.17 | % | 1.05 | % | 1.10 | % | 1.15 | % | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Allowance for loan losses |
$ | 139,576 | $ | 131,087 | $ | 128,386 | $ | 128,762 | $ | 125,572 | ||||||||||
Allowance for loan losses as a percent of period-end loans |
0.95 | % | 0.91 | % | 0.92 | % | 0.93 | % | 0.94 | % | ||||||||||
Allowance for loan losses to nonperforming loans + accruing loans 90 days past due |
78.15 | % | 100.92 | % | 123.14 | % | 137.96 | % | 128.44 | % | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Provision for loan losses |
$ | 10,080 | $ | 6,608 | $ | 6,154 | $ | 9,718 | $ | 9,468 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
NET CHARGE-OFF INFORMATION |
||||||||||||||||||||
Net charge-offs - non-FDIC acquired: |
||||||||||||||||||||
Commercial & real estate loans |
$ | 666 | ($ | 691 | ) | $ | 474 | $ | 1,446 | $ | 2,451 | |||||||||
Residential mortgage loans |
30 | (61 | ) | 904 | 349 | 558 | ||||||||||||||
Consumer loans |
2,775 | 1,962 | 2,276 | 843 | 3,430 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total net charge-offs - non-FDIC acquired |
$ | 3,471 | $ | 1,210 | $ | 3,654 | $ | 2,638 | $ | 6,439 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net charge-offs - non-FDIC acquired to average loans: |
||||||||||||||||||||
Commercial & real estate loans |
0.02 | % | (0.03 | )% | 0.02 | % | 0.06 | % | 0.10 | % | ||||||||||
Residential mortgage loans |
0.01 | % | (0.01 | )% | 0.19 | % | 0.07 | % | 0.12 | % | ||||||||||
Consumer loans |
0.57 | % | 0.43 | % | 0.53 | % | 0.19 | % | 0.82 | % | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total net charge-offs - non-FDIC acquired to average loans |
0.09 | % | 0.03 | % | 0.11 | % | 0.08 | % | 0.19 | % | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
AVERAGE LOANS |
||||||||||||||||||||
Commercial & real estate loans |
$ | 10,608,244 | $ | 10,398,508 | $ | 10,235,268 | $ | 9,943,403 | $ | 9,627,566 | ||||||||||
Residential mortgage loans |
1,977,990 | 1,930,553 | 1,902,873 | 1,886,230 | 1,814,186 | |||||||||||||||
Consumer loans |
1,925,240 | 1,809,843 | 1,731,256 | 1,748,590 | 1,660,356 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total average loans |
$ | 14,511,474 | $ | 14,138,904 | $ | 13,869,397 | $ | 13,578,223 | $ | 13,102,108 | ||||||||||
|
|
|
|
|
|
|
|
|
|
(n) | Nonaccrual loans and accruing loans past due 90 days or more do not include acquired credit-impaired loans which were written down to fair value upon acquisition and accrete interest income over the remaining life of the loan. Included in nonaccrual loans are $4.9 million, $4.9 million, $5.0 million, $7.0 million, and $9.9 million at 9/30/15, 6/30/15, 03/31/15, 12/31/14, and 9/30/14, respectively, in nonaccruing restructured loans. |
16
HANCOCK HOLDING COMPANY
SUPPLEMENTAL ASSET QUALITY INFORMATION
(Unaudited)
Originated Loans | Acquired Loans (o) | FDIC Acquired (p) | Total | |||||||||||||
(dollars in thousands) |
9/30/2015 | |||||||||||||||
Nonaccrual loans (q) |
$ | 163,930 | $ | 3,015 | | $ | 166,945 | |||||||||
Restructured loans - still accruing |
5,779 | | | 5,779 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total nonperforming loans |
169,709 | 3,015 | | 172,724 | ||||||||||||
ORE and foreclosed assets (r) |
21,849 | | 11,750 | 33,599 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total nonperforming assets |
$ | 191,558 | $ | 3,015 | $ | 11,750 | $ | 206,323 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Accruing loans 90 days past due |
$ | 5,747 | 129 | | $ | 5,876 | ||||||||||
Allowance for loan losses |
$ | 113,898 | $ | 173 | $ | 25,505 | $ | 139,576 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
6/30/2015 | ||||||||||||||||
Nonaccrual loans (q) |
$ | 111,455 | $ | 5,401 | $ | 1,589 | $ | 118,445 | ||||||||
Restructured loans - still accruing |
7,966 | | | 7,966 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total nonperforming loans |
119,421 | 5,401 | 1,589 | 126,411 | ||||||||||||
ORE and foreclosed assets (r) |
25,768 | | 12,862 | 38,630 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total nonperforming assets |
$ | 145,189 | $ | 5,401 | $ | 14,451 | $ | 165,041 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Accruing loans 90 days past due |
$ | 3,478 | | | $ | 3,478 | ||||||||||
Allowance for loan losses |
$ | 106,811 | $ | 214 | $ | 24,062 | $ | 131,087 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Originated Loans | Acquired Loans (o) | FDIC Acquired (p) | Total | |||||||||||||
9/30/2015 | ||||||||||||||||
LOANS OUTSTANDING |
||||||||||||||||
Commercial non-real estate loans |
$ | 6,232,310 | $ | 107,985 | $ | 5,699 | $ | 6,345,994 | ||||||||
Construction and land development loans |
1,068,895 | 8,297 | 8,393 | 1,085,585 | ||||||||||||
Commercial real estate loans |
2,956,354 | 352,896 | 18,136 | 3,327,386 | ||||||||||||
Residential mortgage loans |
1,843,756 | 819 | 169,214 | 2,013,789 | ||||||||||||
Consumer loans |
1,976,872 | 22 | 13,402 | 1,990,296 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total loans |
$ | 14,078,187 | $ | 470,019 | $ | 214,844 | $ | 14,763,050 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Change in loan balance from previous quarter |
$ | 687,696 | ($ | 259,605 | ) | ($ | 9,793 | ) | $ | 418,298 | ||||||
|
|
|
|
|
|
|
|
|||||||||
6/30/2015 | ||||||||||||||||
Commercial non-real estate loans |
$ | 6,058,998 | $ | 120,020 | $ | 6,666 | $ | 6,185,684 | ||||||||
Construction and land development loans |
1,100,788 | 9,064 | 11,095 | 1,120,947 | ||||||||||||
Commercial real estate loans |
2,591,384 | 598,962 | 22,487 | 3,212,833 | ||||||||||||
Residential mortgage loans |
1,784,730 | 1,554 | 169,553 | 1,955,837 | ||||||||||||
Consumer loans |
1,854,591 | 24 | 14,836 | 1,869,451 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total loans |
$ | 13,390,491 | $ | 729,624 | $ | 224,637 | $ | 14,344,752 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Change in loan balance from previous quarter |
$ | 469,961 | ($ | 35,700 | ) | ($ | 13,895 | ) | $ | 420,366 | ||||||
|
|
|
|
|
|
|
|
(o) | Loans which have been acquired and no allowance brought forward in accordance with acquisition accounting. Acquired-performing loans in pools with fully accreted purchase fair value discounts are reported as originated loans. |
(p) | Loans acquired in an FDIC-assisted transaction. Non-single family loss share agreement expired at 12/31/14. As of 9/30/15, $177.5 million in loans and $2.3 million in ORE remain covered by the FDIC single family loss share agreement, providing considerable protection against credit risk. As of 6/30/15, $179.0 million in loans and $3.5 million in ORE remained covered by the FDIC single family loss share agreement. |
(q) | Included in originated nonaccrual loans are $4.9 million and $4.9 million at 9/30/15 and 6/30/15, respectively, in nonaccruing restructured loans. |
(r) | ORE received in settlement of acquired loans is no longer subject to purchase accounting guidance and has been included with ORE from originated loans. ORE received in settlement of covered loans remains covered under the FDIC loss share agreements. |
17
Third Quarter 2015 Financial Results October 22, 2015 Third Quarter 2015 Financial Results October 22, 2015 |
Certain of the statements or information included in this presentation may constitute
forward-looking statements.
Forward-looking statements include projections of revenue, costs, results of operations or financial condition or statements regarding future market
conditions or our potential plans and strategies for the
future. Hancocks ability to
accurately project results, predict the effects of
future plans or strategies, or predict
market or economic developments is inherently
limited. We believe that the
expectations reflected or implied by any forward-looking statements are based on reasonable assumptions, but actual results and performance could differ
materially from those set forth in the
forward-looking statements. Factors that could cause actual results or outcomes to differ from those expressed in the Company's
forward-looking statements include, but are not
limited to, those outlined in Hancock's
SEC filings, including the Risk Factors
section of the Companys 10-K for the year ended December 31, 2014 and as updated by the Companys subsequent SEC filings.
Hancock undertakes no obligation to update or revise any
forward-looking statements, and you
are cautioned not to place undue reliance on such forward-looking statements. Forward Looking Statements 2 |
Hancock Holding Company $21.6 billion in Total Assets $14.8 billion in Total Loans $17.4 billion in Total Deposits Tangible Common Equity (TCE) 8.24% Nearly 200 banking locations and 275 ATMs across a five-state footprint
Approximately 4,000 employees corporate-wide Rated among the strongest, safest financial institutions in the country by BauerFinancial, Inc.
Earned top customer service marks with Greenwich Excellence Awards
As of September 30, 2015
3 |
Third Quarter 2015 Highlights (compared to second quarter 2015) Earnings increased $6.3 million, or 18% E.P.S. of $.52 increased 18% Pre-tax, pre-provision earnings increased 22%
Core revenue increased $6.2 million, or 3% Loans increased $418 million, or 12% LQA Deposits increased $138 million, or 3% LQA Fee income (excluding accretion in indemnification asset) relatively stable Loan loss provision reflects approximately $5 million build for energy portfolio; energy reserve exceeds 2% at September 30, 2015 Core NIM of 3.15% increased 1 basis point Operating expense up less than 1% ($s in millions; except per share data) 3Q15 2Q15 Fav/(unfav) Net Income $41.2 $34.8 18% Earnings Per Share $.52 $.44 18% Pre-tax, pre-provision income $69.2 $56.8 22% Operating Income* $41.2 $40.6 1% Operating Earnings Per Share $.52 $.51 2% Nonoperating expense items -- $8.9 N/M Return on Assets (operating) (%) 0.76 0.78 (2bps) Return on Tangible Common Equity (operating) (%) 9.60 9.66 (6bps) Total Loans (period-end) $14,763 $14,345 3% Total Deposits (period-end) $17,440 $17,302 1% Net Interest Margin (%) 3.28 3.30 (2bps) Net Interest Margin (%) (core) 3.15 3.14 1bp Net Charge-offs (%) (non-covered) 0.09 0.03 (6bps) Tangible Common Equity (%) 8.24 8.12 12bps Efficiency Ratio** (%) 65.9 66.7 79bps Net Purchase Accounting Income (pre-tax) -$1.2 $0.3 N/M Net Income (excluding tax-effected impact of net
purchase accounting items and nonoperating
items)
$42.0
$40.4
4%
E.P.S. (excluding
tax-effected impact of net purchase
accounting items and nonoperating
items)
$.53
$.51
4%
4
* Operating income is defined as net
income excluding tax-effected securities transactions gains or losses and nonoperating expense items. ** Noninterest expense to total revenue (TE) excluding amortization of purchased intangibles,
nonoperating items, and securities transactions. |
Quarterly E.P.S. Trend Since 1Q13 replaced almost $.22 of purchase accounting income with quality, core banking income Lines have converged and reported, operating and core earnings, and E.P.S. basically equal Beginning with 3Q15, reporting only net earnings and E.P.S. Slight differences will remain due to purchase accounting and will be noted as appropriate Any future nonoperating items will be noted as such 5 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 "PAA Gap" $0.22 $0.19 $0.22 $0.16 $0.13 $0.13 $0.10 $0.06 $0.06 $- $(0.01) Core EPS $0.34 $0.36 $0.34 $0.39 $0.45 $0.46 $0.49 $0.50 $0.49 $0.51 $0.53 Operating EPS $0.56 $0.55 $0.56 $0.55 $0.58 $0.59 $0.59 $0.56 $0.55 $0.51 $0.52 Reported EPS $0.56 $0.55 $0.40 $0.41 $0.58 $0.48 $0.56 $0.48 $0.49 $0.44 $0.52 $0.22 $0.19 $0.22 $0.16 $0.13 $0.13 $0.10 $0.06 $0.06 $0.00 -$0.01 -$0.10 $0.00 $0.10 $0.20 $0.30 $0.40 $0.50 $0.60 $0.70 "PAA Gap" Core EPS Operating EPS Reported EPS We define core income as operating income less purchase accounting adjustments (PAA). PAA items include loan
accretion from Whitney and Peoples First, offset by amortization of the Whitney bond portfolio premium, amortization of the Peoples First indemnification asset and amortization of
intangibles. Operating income is defined as net income excluding tax-effected securities transactions gains or losses and nonoperating
expense items. See table on slide 25.
|
Core NIM Stable, Core Loan Yield Improves Core NIM = reported net interest income (TE) excluding total net purchase accounting
adjustments, annualized, as a percent of average
earning assets. (See slide 23)
Reported net interest margin (NIM) 3.28%, down 2 bps
linked-quarter reflecting the decline in purchase accounting adjustments of $1.3 million Core NIM of 3.15% increased 1 bp linked-quarter Core loan yield up 4bps Yield on bond portfolio up 3bps Cost of funds up 2bps One additional accrual day impacted net interest income
Projected accretion will still lead to a difference in reported and core NIMs
4.06%
3.99%
3.81%
3.63%
3.55%
3.30%
3.28%
3.37%
3.35%
3.32%
3.27%
3.21%
3.14%
3.15%
$130
$135
$140
$145
$150
$155
2.50%
2.70%
2.90%
3.10%
3.30%
3.50%
3.70%
3.90%
4.10%
4.30%
1Q14
2Q14
3Q14
4Q14
1Q15
2Q15
3Q15
Core NII
NIM - reported
NIM - core
5.00%
4.86%
4.63%
4.41%
4.36%
4.10%
4.09%
4.02%
3.97%
3.94%
3.91%
3.88%
3.85%
3.89%
2.47%
2.43%
2.36%
2.36%
2.35%
2.22%
2.25%
0.23%
0.22%
0.21%
0.23%
0.24%
0.28%
0.30%
1Q14
2Q14
3Q14
4Q14
1Q15
2Q15
3Q15
Loan Yield - reported
Loan Yield - core
Securities Yield - reported
Cost of Funds - reported
6
As of September 30, 2015
|
1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 Avg Qtrly Loans $11.5 $11.6 $11.8 $11.9 $12.4 $12.7 $13.1 $13.6 $13.9 $14.1 $14.5 Avg Qtrly Loans less Energy $10.6 $10.6 $10.7 $10.6 $10.9 $11.1 $11.4 $11.9 $12.2 $12.5 $12.8 Energy (avg) $0.93 $0.99 $1.12 $1.35 $1.51 $1.59 $1.68 $1.72 $1.70 $1.67 $1.66 energy as a % of loans (avg) 8% 8% 10% 11% 12% 13% 13% 13% 12% 12% 11% LQA EOP growth -3% 7% 2% 20% 7% 11% 14% 16% 1% 12% 12% LQA EOP growth excl energy -6% 6% -7% 14% 4% 10% 13% 20% 2% 14% 13% $10.0 $11.0 $12.0 $13.0 $14.0 $15.0 Well-Diversified Loan Growth Loans totaled $14.8 billion at quarter-end, an increase of $418 million,
or 3% linked-quarter (12% LQA)
Net loan growth during the quarter was well-diversified by geography
and loan type
Energy loans totaled $1.6 billion or 11% of total loans, down from 12%
last quarter and down from 13% a year ago
No energy portfolio growth expected for the remainder of 2015
Continued diversification of the loan portfolio through purchase
agreement for $190 million of healthcare loans (expected
closing 4Q15) $s in millions
7
$s in billions
As of September 30, 2015
$s in millions
C&I
$6,346
43%
C&D
$1,086
7%
CRE
$3,327
23%
Mortgage
$2,014
14%
Consumer
$1,990
13%
Total Loans
$14,763
9/30/15
West Region
(TX &
SWLA)
$43
East Region
(MS, AL &
FL)
$107
Institutional
$91
Equipment
Finance
$43
Indirect
$60
Mortgage
$75
HFC
$10
Major drivers of EOP Loan Growth
3Q15 |
Energy Portfolio Risk Is Well-Managed Energy lending has been a core competency for more than 60 years Disciplined underwriting, long term relationships Continuing to review credits and stay close to our customers Pricing pressures on oil have continued and we did see additional downward pressure on risk ratings this quarter Management believes that further risk rating downgrades could impact loan loss provisions but should not result in significant credit losses Impact and severity will depend on overall oil price reduction and duration of the cycle 8 As of September 30, 2015 Reducing Energy Concentration While Maintaining Relationships With
Long-Term, Experienced O&G Clients
3Q14 4Q14 1Q15 2Q15 3Q15 % of total loans 13.0% 12.4% 12.0% 11.6% 11.2% 10.0% 10.5% 11.0% 11.5% 12.0% 12.5% 13.0% |
Diversified O&G Portfolio; Minimal Losses Over Previous Energy Cycles 9 $s in millions As of September 30, 2015 Energy portfolio totaled $1.6 billion at September 30, 2015, down 4% from year-end 2014 Relationship business dating back to post WWII Excellent source of no/low cost core deposits Disciplined underwriting With experienced management in place, many of our clients have been reacting to the reduction in oil prices by proactively managing expenses, lowering discretionary spending or reducing capital expenditures $1,724 $1,674 $1,669 $1,660 4Q14 1Q15 2Q15 3Q15 Nondrilling 663 672 658 682 Drilling 310 270 280 269 Midstream 102 109 104 103 Upstream 648 623 627 607 $0 $250 $500 $750 $1,000 $1,250 $1,500 $1,750 Upstream Midstream Drilling Nondrilling |
Upstream (E&P) Portfolio Diversified, Profitable Priority, secured loans; approximately 60% oil, 40% gas
Approximately $20 million linked-quarter decrease in E&P outstandings;
Current line utilization is approximately 64% up slightly linked-quarter
Lend only on proved reserves (on a risked basis); 90%+ are covered by Proved Developed Producing Reserves alone E&P customers have hedges in place; many of our clients are hedged with an average tenor of 2.5
years
Our clients breakeven at different prices/barrel oil
Breakeven varies depending on the basin Our customers are diversified across 12 primary basins in the U.S. and in the Gulf of Mexico
Borrowing base redeterminations twice per year; all credits were reviewed in 2Q15 and adjustments made to overall
commitment levels
RBL commitments reduced approximately 15% on average
since the beginning of the year due to lower commodity prices
Expect RBL commitments to be reduced an additional 15% on average in the fall redetermination due to continued low
commodity prices
10
Low level of cumulative losses over previous down cycles
even with growth in outstandings As of
September 30, 2015 |
Support Sector Companies Have Weathered Previous Cycles Many of our clients have operated through previous cycles,
including the mid 80s, late 90s and
2008
Our clients typically have low/moderate leverage, strong
balance sheets and experienced
management
Most of the support nondrilling
companies are based in
south Louisiana and Houston, and many are supporting
offshore activity
Outstandings up slightly linked-quarter Current line utilization is approximately 60% Credits with working capital show 40% line utilization
Day rates and service sector profitability is being impacted; however, we believe that based on
historical client experience and liquidity many of our
seasoned customers have the ability to weather the current cycle 11 As of September 30, 2015 Experienced, long-time customers with low level of cumulative losses over previous down cycles
$s in millions
$s in millions
Contract drillers
$83
31%
Rental tools
$84
31%
Completion
services
$89
33%
Other
$12
5%
Support Drilling Subcategories
Helicopter &
marine transport $348 51% Fabrication, construction, installation $150 22% Other $118 17% Supply/ manufacturing 66 10% Support Nondrilling Subcategories |
Allowance For Loan Losses The allowance for loan losses was $139.6 million (0.95%) compared to $131.1 million
(0.91%) linked-quarter
The allowance maintained on the non-FDIC acquired
portion of the loan portfolio increased $7.0
million linked-quarter, totaling $114.0 million, and
the reserve on the FDIC acquired loan portfolio increased approximately $1.5 million linked-quarter
Impact of the current energy cycle on the
allowance*:
The third quarters allowance calculation reflects
a build of approximately $5 million in the
reserve for the energy portfolio related to updates to
risk ratings and changes in the qualitative
factors related to energy
ALLL for energy credits was 2.12% at September 30,
2015, up from 1.91% at June 30, 2015
We are disciplined in our underwriting, and while we
expect to see continued pressure in risk
ratings given the prolonged cycle, based on what we
know today we expect no significant
credit loss in our energy portfolio
We believe our current reserves are sufficient to cover any credit losses in the portfolio
Should pricing pressures on oil continue, we could continue to see downward pressure on risk
ratings that could lead to additional provision expense
in future quarters
Impact and severity will depend on overall oil price
reduction and duration of the cycle
12
* Reserve reflects the amount of C&I reserve (loss
factors) applied to the energy loans risk ratings. As of September 30, 2015 |
Potential Impact To Provision From Energy Downgrades (Downward Shock Scenarios are mutually exclusive)
13
Total
outstanding
at 3-31-15
Total
outstanding
at 6-30-15
Total
outstanding
at 9-30-15
Energy
Reserve*
3-31-15
Energy
Reserve*
6-30-15
Energy
Reserve*
9-30-15
Incremental
Provision
Scenario 1
Incremental
Provision
Scenario 2
Incremental
Provision
Scenario 3
$623MM
$627MM
$607MM
Upstream
$5.0MM
$10.1MM
$11.0MM
$1.8MM
$1.8MM
$1.8MM
$109MM
$104MM
$103MM
Midstream
$0.6MM
$0.7MM
$0.7MM
$0.7MM
$2.8MM
$2.8MM
$270MM
$280MM
$269MM
Support
Drilling
$4.1MM
$7.9MM
$7.4MM
$3.5MM
$6.2MM
$9.6MM
$672MM
$658MM
$682MM
Support
Non-
drilling
$10.3MM
$11.9MM
$16.1MM
$11.8MM
$22.0MM
$29.6MM
Incremental
Provision
---------
---------
---------
$17.8MM
$32.8MM
$43.8MM
$1.674B
$1.669B
$1.660B
Total Energy
Reserve (%)
$20.0MM
(1.17%)
$30.6MM
(1.91%)
$35.2MM
(2.12%)
$53.0MM
(3.19%)
As a % of current
portfolio
$68.0MM
(4.10%)
As a % of current
portfolio
$79.0MM
(4.76%)
As a % of current
portfolio
Scenario 1
all categories = 1 RR downgrade
Scenario 2
Upstream = 1 RR downgrade; all other sectors = 2 RR
downgrade Scenario 3
Upstream = 1 RR downgrade; Midstream = 2 RR downgrade;
Support Sectors = 3 RR downgrade Impact and
severity will depend on overall oil price reduction and duration of the cycle * Reserve reflects the amount of C&I reserve (loss factors) applied to the energy loans risk
ratings. Portfolio Shock Scenarios based on
current quarter balances and risk ratings |
0.5% 1.0% 1.5% 2.0% 2.5% $0 $100 $200 $300 $400 $500 $600 $700 $800 $900 3Q14 4Q14 1Q15 2Q15 3Q15 Criticized - Non energy Criticized - Upstream Criticized - nondrilling Criticized - drilling Energy reserves as a % of energy loans Asset Quality Measures Reflect Impact Of Energy Cycle NPA ratio 1.39%, up 24 bps linked-quarter Nonperforming assets totaled $206 million, up $41 million from June 30, 2015
Nonperforming loans increased approximately $46 million
linked-quarter
Mainly related to 3 energy loans which were downgraded
during the quarter
ORE and foreclosed assets decreased approximately $5
million linked-quarter;
Provision for loan losses was $10.1 million, up $3.5
million from 2Q15
Non-FDIC acquired net charge-offs totaled $3.5
million, 9 bps, up from $1.2 million, or 3 bps, in 2Q15
Criticized commercial loans totaled $807 million at September 30, 2015, up $181 million from June 30,
2015 Increase mainly related to risk rating
downgrades within the energy portfolio; approximately $66 million of the increase in 3Q15 was related to shared national credits that were on appeal at June 30, 2015 and were
reserved for in 2Q15 $0 $25 $50 $75 $100 $125 $150 $175 $200 3Q14 4Q14 1Q15 2Q15 3Q15 E&P Support nondrilling Support drilling Total Nonaccrual loans Nonaccrual Loans 14 Criticized Loans - Commercial As of September 30, 2015 |
Securities Portfolio Portfolio Mix Increased Net Interest Income Portfolio totaled $4.5 billion, up $103 million,
or 2% linked-quarter
Yield 2.25% - up 3 bps linked-quarter Unrealized gain (net) of $28.4 million on AFS 52% HTM, 48% AFS Duration 3.87 compared to 3.96 at 6-30-15
Balance sheet is asset sensitive over a 2 year period to rising interest rates under various shock scenarios IRR modeling is based on conservative assumptions Flat balance sheet Loan portfolio 53% variable (with 56% LIBOR-based)
Modeled lag in deposit rate increases Conservative % DDA attrition for certain increases in rates
$s in millions
15
1.0%
2.9%
4.2%
4.9%
1.2%
3.3%
4.4%
4.6%
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
+100 shock
+200 shock
+300 shock
+400 shock
Year 1
Year 2
Net Interest Income Scenarios
Regulatory Rate Shocks
Period-end balances. As of September 30,
2015 CMO
$1,453
32%
MBS
$2,808
62%
Munis
$203
5%
U. S. Agencies
and other
$56
1%
Securities Portfolio
Mix 9/30/15 |
Solid Levels Of Core Deposit Funding Noninterest bearing $6,075 35% Interest- bearing transaction & savings $7,361 42% Interest- bearing public funds $1,768 10% Time deposits $2,236 13% Total Deposits $17,440 9/30/15 Total deposits $17.4 billion, up $138 million, or 1%,
linked-quarter
Noninterest-bearing demand deposits (DDA) decreased
$105 million Interest-bearing
transaction and savings deposits increased $366 million Time deposits increased $72 million Public fund deposits decreased $194 million Funding mix remained strong DDA comprised 35% of total period-end deposits
Cost of funds increased 2 basis points to 30 bps 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 Avg Qtrly Deposits $15.3 $15.2 $15.0 $14.9 $15.3 $15.1 $15.4 $15.9 $16.5 $16.9 $17.3 LQA EOP growth -13% -3% -3% 8% -2% -1% 13% 21% 7% 10% 3% $14.0 $14.5 $15.0 $15.5 $16.0 $16.5 $17.0 $s in billions 16 $s in millions |
Focus On Growing Core Noninterest Income Across Business Lines Service Charges on Deposit $18.6 30% Trust $11.3 18% Investment & annuity $6.1 10% Insurance $2.2 4% Bankcard and ATM $11.6 19% Secondary mortgage operations $3.4 5% Other (excluding IA amort) $8.4 14% Noninterest income, including securities transactions, totaled
$60.2 million, down $0.7 million, or 1%,
linked-quarter Amortization of the
indemnification asset for FDIC covered loans
totaled $1.6 million, compared to $1.3 million in the
second quarter; the amortization is a
reduction to noninterest income and is a
result of a lower level of expected future losses on covered loans (non-core) Excluding the impact of the indemnification asset, noninterest
income was relatively stable
linked-quarter $s in
millions 17
Core Noninterest Income Mix 3Q15
As of September 30, 2015
$62.1
$61.8
$0.7
$0.4
$0.2
$1.0
$0.2
$1.2
$55
$57
$59
$61
$63
$65
2Q15 Noninterest
Income
(excluding IA)
Service Charges
on Deposit
Bankcard &
ATM Fees
Investment &
Annuity Income
and Insurance
Trust Fees
Secondary
Mortgage Fees
Other
3Q15 Noninterest
Income
(excluding IA) |
Continuing To Control Operating Expenses Operating expenses totaled $151.2 million in 3Q15, up $1.2 million, or less than
1%, linked-quarter
Personnel expense totaled $84.2 million, up $1.6
million, or 2%, linked-quarter, mainly
related to an increase in salary and incentive expense
for revenue initiatives Occupancy and
equipment totaled $14.8 million, down $1.0 million, or 6%, linked-quarter ORE expense totaled $0.4 million, down $0.1 million linked-quarter
Other operating expense increased $0.8 million, or 2%,
linked-quarter Personnel
$84.2
56%
Occupancy
$11.2
8%
Equipment
$3.6
2%
ORE
$0.4
Other
$45.8
30%
Amortization
of
intangibles
$6.0
4%
Operating Expense Mix 3Q15
18
$s in millions
$150.0
$151.2
$1.6
$0.6
$0.5
$0.5
$140
$142
$144
$146
$148
$150
$152
2Q15 Operating
Expense
Personnel Expense
Occupancy
Equipment
Other Expense
3Q15 Operating
Expense
As
of
September
30,
2015;
excluding
nonoperating
expense
items. |
Continuing Efforts To Diversify Loan Portfolio Through Healthcare LPO and Team in Nashville 19 Experienced team of healthcare bankers join the company
Acquiring approximately $190 million in healthcare loans in 4Q15
Operating today in markets such as Houston with its well-known medical sector, and New Orleans
with its revitalized medical district, we see this
acquisition of bankers and loans as a strategic fit for our markets New LPO in Nashville, known as the healthcare capital of the country, will allow us to better offer
our financial products and services to an industry that
is growing across our footprint
Corporate banking product sophistication, should also
benefit the clients who are joining us via this transaction and enable this talented team of healthcare bankers to capitalize on additional
opportunities available across our
footprint As of September 30,
2015 |
Solid Capital Levels TCE ratio 8.24%, up 12 bps linked-quarter Announced 5% common stock buyback August 2015 Repurchased 568,279 million shares in 3Q15 at an average price of $27.39 Will continue to review additional options to deploy excess capital in the best interest of the Company and its shareholders Organic growth Stock buyback (Stock price approximately $28 or less) M&A (Stock price approximately $32 or greater)
Dividends *Stock Buyback (ASR) initiated 20 Tangible Common Equity Ratio Leverage (Tier 1) Ratio Tier 1 Risked-Based Capital Ratio Total Risk-Based Capital Ratio September 30, 2015 8.24% 8.86%(e) 10.60%(e) 12.38%(e) June 30, 2015 8.12% 9.07% 10.77% 12.53% March 31, 2015 8.40% 9.17% 10.86% 12.77% December 31, 2014 8.59% 9.17% 11.23% 12.30% As of September 30, 2015 7% 8% 9% 10% 11% 12% 13% 14% 15% 1Q13 2Q13* 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15e TCE Tier 1 Risk-Based Capital Total Risk-Based Capital Capital Rations |
Near-Term Outlook 3Q15 Items to note Outlook Loans +12% LQA +11% Y-o-Y Limited net paydowns in energy portfolio compared to previous expectations 8-9% EOP growth for full year 2015 8-10% EOP growth for full year 2016 (includes acquired healthcare portfolio; could be
impacted by future energy paydowns)
Net
Interest Margin
(NIM)
3.28% reported
3.15% core
Reported down 2bps;
Core
up 1bp
Continued downward pressure on reported NIM due to
purchase accounting; stabilization of
core NIM Core Revenue
$215.5 million
Excludes
PAAs
(see slide 23)
Recent growth reflects initiatives started in the
prior several quarters; expect growth as
initiatives continue to
mature
Loan Loss Provision
$10.1 million
Includes
approximately $5
million of reserve
build related to energy
Should pricing pressures on oil continue, we could see
additional risk rating downgrades and
increased provisions; not expecting
significant charge-offs Noninterest
Expense $151.2 million
operating
No nonoperating
costs
Slightly higher in the near term
E.P.S.
$.52
Net, operating and
core converge in 3Q15
(calculations on slides
22 and 25)
Current expectations for 4Q15 are in line with current
quarterly street estimates
21
As of September 30, 2015
|
Appendix: EPS calculation $s in thousands, except E.P.S. Three Months Ended 9/30/15 Three Months Ended 6/30/15 Three Months Ended 9/30/14 Net income to common shareholders $41,166 $34,829 $46,553 Income allocated to participating securities ($840) ($766) ($883) Net income allocated to common shareholders $40,326 $34,063 $45,670 Weighted average common shares diluted 78,075 78,115 81,942 E.P.S. - diluted $.52 $.44 $.56 See Note 9 in the most recent 10Q for more details on the two-class method for E.P.S.
calculation. 22
|
Appendix: Purchase Accounting Adjustments Core NII & NIM Reconciliation * Excess cash recoveries include cash collected on certain zero carrying value acquired loan pools above expected
amounts. 23
($s in millions)
3Q15
2Q15
1Q15
4Q14
3Q14
Net
Interest
Income
(TE)
reported
(NII)
$160.1
$154.9
$161.1
$163.6
$166.2
Whitney expected loan accretion
(performing) 0.6
1.1
1.2
2.7
5.0
Whitney expected loan accretion (credit
impaired)
5.6
6.8
11.3
13.8
17.0
Peoples First expected loan
accretion
1.1
0.9
1.1
.7
.8
Excess cash
recoveries*
---
---
2.8
---
---
Total Loan Accretion
$7.3
$8.7
$16.4
$17.2
$22.8
Whitney premium bond amortization
(0.9)
(1.0)
(1.0)
(1.2)
(1.3)
Whitney and Peoples First CD accretion
---
---
---
---
---
Total Net Purchase Accounting
Adjustments (PAAs) impacting NII
$6.4
$7.7
$15.3
$16.0
$21.5
Net
Interest
Income
(TE)
core
(Reported NII less net PAAs)
$153.8
$147.2
$145.8
$147.6
$144.7
Average Earning
Assets
$19,433
$18,781
$18,316
$17,911
$17,324
Net
Interest
Margin
reported
3.28%
3.30%
3.55%
3.63%
3.81%
Net
Purchase Accounting Adjustments (%)
.13%
.16%
.34%
.36%
.49%
Net Interest Margin -
core
3.15%
3.14%
3.21%
3.27%
3.32% |
1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 E 1Q16 E 2Q16 E 3Q16 E 4Q16 E PAA Revenue - act* 37 33 35 27 24 23 19 14 14 6 5 PAA Revenue - proj* 5 5 4 3 3 2 Intangible Amort 7 7 7 7 7 7 7 6 6 6 6 6 5 5 5 5 Pre-tax impact 30 25 28 20 17 17 12 7 8 0 -1 0 -1 -2 -2 -3 $0 $5 $10 $15 $20 $25 $30 $35 $40 Appendix: Purchase Accounting Impact/Trend Impact of Purchase Accounting Adjustments (projections will be updated quarterly; subject to change) $s in millions *Projected revenue includes loan accretion from Whitney and Peoples First,
offset by amortization of the Whitney bond portfolio
premium and amortization of the Peoples
First indemnification asset.
2012
2013
2014
2015
2016
2017
Post
2017
Revenue impact*
$124
$132
$80
$31
$13
$9
$16
Pre-tax impact PAA
$93
$103
$54
$7
$0
$25
$50
$75
$100
$125
$150
24
N/M
N/M
N/M
As of September 30, 2015
|
Appendix: Non-GAAP Reconciliation (Net Income, ROA, E.P.S.) $s in millions (except EPS) Three Months Ended 9/30/15 Three Months Ended 6/30/15 Three Months Ended 9/30/14 Net income $41.2 $34.8 $46.6 Adjustments from net to operating income Securities transactions gains - - - Total nonoperating expense items (pre-tax) - 8.9 3.9 Taxes on adjustments at marginal tax rate - 3.1 1.4 Total adjustments (net of taxes) - 5.8 2.5 Operating income $41.2 $40.6 $49.1 Adjustments from operating to core income PAA Net Interest Margin (see slide 23) 6.4 7.7 21.5 Intangible Amortization (noninterest expense) -6.0 -6.1 -6.6 Amortization of Indemnification Asset (noninterest income)
-1.6
-1.3
-2.8
Total Purchase
Accounting Adjustments (PAA) (pre-tax)
$-1.2
$0.3
$12.1
Taxes on adjustments
at marginal tax rate
-0.4
0.1
4.2
Total PA
adjustments (net of taxes)
-0.8
0.2
7.9
Core
Income (Operating less purchase accounting
items) 42.0
$40.4
$41.2
Average
Assets
$21,481
$20,875
$19,550
ROA (operating)
0.76%
0.78%
1.00%
ROA (core)
0.77%
0.78%
0.84%
Weighted Average Diluted Shares
(thousands) 78,015
78,115
81,942
E.P.S. (operating)
$.52
$.51
$.59
E.P.S. (core)
$.53
$.51
$.49
25 |
Appendix: Whitney Portfolio Continues Solid Performance Loan mark on the acquired-performing portfolio accreted into earnings over the life of the
portfolio
Credit-impaired loan mark available for charge-offs; if not needed for charge-offs then
accreted into income
Quarterly reviews of accretion levels and portfolio performance will impact reported margin
26
As of September 30, 2015
$s in millions
Credit
-
Impaired
Performing
Total
Whitney loan mark at acquisition (as adjusted in
4Q11) $284
$187
$471
Acquired portfolio loan balances at
acquisition $818
$6,101
$6,919
Discount at acquisition
34.7%
3.1%
6.8%
Remaining Whitney loan mark at 9/30/15
$38
$3
$41
Remaining acquired portfolio loan balances at
9/30/15 $73
$438
$511
Acquired loan charge-offs from acquisition thru
9/30/15 $24
$14
$38
Discount at 9/30/15
51.8%
0.7%
8.0% |
Appendix: Peoples First Loan Mark Used For Charge-Offs FDIC acquired loan portfolio Entire loan mark available for charge-offs; if not needed for charge-offs then accreted into
income
Quarterly reviews of accretion levels and portfolio
performance will impact reported margin
FDIC loss share receivable totaled $32.0 million at
September 30, 2015
Non-single family FDIC loss share agreement expired
at December 31, 2014
$178 million remains covered under FDIC single family
loss share agreement 27
As of September 30, 2015
$s in millions
Credit
Impaired
Peoples
First loan mark at acquisition
(12/2009) $509
Charge
-offs from acquisition thru 9/30/15
$429
Accretion since acquisition date
$94
Remaining loan mark at 9/30/15
$32
Impairment reserve at 9/30/15
$26
Remaining portfolio loan balances at
9/30/15 $251
Discount & allowance at 9/30/15
23% |
LPO Loan production office LQA- Linked-quarter annualized M&A Mergers and acquisitions NII Net interest income NIM Net interest margin NPA Nonperforming assets O&G Oil and gas Operating Income Operating income is defined as net income excluding
tax-effected securities transactions gains or
losses and nonoperating expense items.
ORE
Other real estate
PAA
Purchase accounting adjustments, including loan
accretion from Whitney and Peoples First,
offset by amortization of the Whitney bond
portfolio premium, amortization of the Peoples First
indemnification asset and amortization of
intangibles RBL
Reserve-based lending
ROA
Return on average assets
RR
Risk rating
TCE
Tangible common equity ratio (common shareholders
equity less intangible assets divided by
total assets less intangible assets.
TE-
Taxable equivalent (calculated using a federal income
tax rate of 35%)
Y-o-Y
Year over year
Appendix: Glossary of Terms
3Q15
Third quarter of 2015
4Q15
Fourth quarter of 2015
AFS
Available
for sale
ALLL
Allowance for loan and lease loss
Annualized
Calculated to reflect a rate based on a full
year Core
Excluding purchase accounting items
Core Income Operating income less purchase accounting adjustments
Core NIM Reported net interest income (TE) excluding total net purchase
accounting adjustments, annualized, as a percent of
average earning assets Core Revenue Net interest income (TE) plus noninterest income excluding
purchase accounting adjustments for both
categories DDA
Noninterest-bearing deposit accounts
E&P
Exploration and Production (Oil & Gas)
Efficiency ratio noninterest expense to total net interest (TE) and noninterest
income, excluding amortization of purchased intangibles,
nonoperating items,
and securities transactions.
EOP- End of period EPS Earnings per share HTM Held to maturity IRR Interest rate risk Linked-quarter current quarter compared to previous quarter 28 |
Third Quarter 2015 Financial Results October 22, 2015 Third Quarter 2015 Financial Results October 22, 2015 |