UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): October 24, 2013
HANCOCK HOLDING COMPANY
(Exact name of registrant as specified in its charter)
Mississippi | 0-13089 | 64-0693170 | ||
(State or other jurisdiction of incorporation) |
(Commission File Number) |
(I.R.S. Employer Identification No.) |
One Hancock Plaza 2510 14th Street |
39501 | |
(Address of principal executive offices) | (Zip Code) |
(228) 868-4000
(Registrants telephone number, including area code)
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.02 | Results of Operations and Financial Condition. |
On October 24, 2013, Hancock Holding Company issued a press release reporting its third quarter earnings for the period ended September 30, 2013. A copy of this press release and the accompanying financial statements and slide presentation are attached hereto as Exhibit 99.1.
Item 9.01 | Financial Statements and Exhibits. |
(d) | Exhibits. |
Exhibit |
Description | |
99.1 | Press Release dated October 24, 2013 for Quarter Ended September 30, 2013. |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
HANCOCK HOLDING COMPANY | ||||||
October 24, 2013 | /s/ Michael M. Achary | |||||
Michael M. Achary | ||||||
Chief Financial Officer |
Exhibit 99.1
For Immediate Release
October 24, 2013
For More Information
Trisha Voltz Carlson
SVP, Investor Relations Manager
504.299.5208
trisha.carlson@hancockbank.com
Hancock reports third quarter 2013 financial results
GULFPORT, Miss. (October 24, 2013) Hancock Holding Company (Nasdaq: HBHC) today announced its financial results for the third quarter of 2013. Operating income for the third quarter of 2013 was $46.8 million or $.56 per diluted common share, compared to $46.9 million, or $.55 in the second quarter of 2013. Operating income was $49.8 million, or $.58, in the third quarter of 2012. Operating income is defined as net income excluding tax-effected securities transactions gains or losses and one-time noninterest expense items. Included in the financial tables is a reconciliation of net income to operating income. Management believes that operating income provides a useful measure of financial performance that helps investors compare the Companys fundamental operations over time.
Hancocks return on average assets (ROA) (operating) was 0.99% for the third quarter of 2013, unchanged from the second quarter of 2013. ROA (operating) was 1.07% in the third quarter a year ago.
Highlights of the Companys third quarter of 2013 results:
| Net income included one-time noninterest expense items of $20.9 million, or $13.6 million after tax, or $.17 per diluted common share |
| Core net interest income (TE) and net interest margin (NIM) remained relatively stable (the Company defines its core results as reported results less the impact of net purchase accounting adjustments.) |
| An increase of $4.6 million, or a tax-effected $.04 per diluted share, in purchased loan accretion related to excess cash recoveries |
| Approximately $92 million linked-quarter net loan growth, or 3% annualized, and $464 million, or 4%, year-over-year loan growth (each excluding the FDIC-covered portfolio) |
| Continued improvement in overall asset quality metrics |
| Decline in operating expense linked-quarter; on track to meet 1Q14 expense target |
| Closed 26 banking locations across the five-state footprint on August 30, 2013 |
- 1 -
Hancock reports third quarter 2013 financial results
October 24, 2013
Our third quarter results reflect progress in implementing our current strategic initiatives, said Hancocks President and Chief Executive Officer Carl J. Chaney. Stabilization of the core margin and net interest income, better loan pricing, improved asset quality, reduced operating expenses and ongoing focus on efficiency, are all keys to achieving our goals for 2014 and beyond. Our associates are working diligently to implement the expense and efficiency initiative, and we are confident we will meet the targets set earlier this year.
Net income in the third quarter of 2013 was $33.2 million, or $.40 per diluted common share, compared to $46.9 million, or $.55, in the second quarter of 2013. Net income was $47.0 million, or $.55 per diluted common share, in the third quarter of 2012. Net income included certain one-time noninterest expenses of $20.9 million in the third quarter of 2013 and $5.3 million in the third quarter of 2012. Return on average assets (ROA) was 0.70% for the third quarter of 2013, compared to 0.99% in the second quarter of 2013 and 1.00% in the third quarter a year ago.
Loans
Total loans at September 30, 2013 were $11.7 billion, up $53 million from June 30, 2013. Excluding the FDIC-covered portfolio, which declined $39 million during the third quarter of 2013, total loans increased $92 million, or 1% linked-quarter.
Solid origination activity with commercial customers across the Companys footprint, especially in south Louisiana, was offset by higher than normal paydowns and payoffs, as well as some seasonal net reductions. As a result, commercial and industrial (C&I) loans were down slightly for the quarter.
The largest component of linked-quarter net growth was in the residential mortgage portfolio, reflecting mainly a strategic decision to retain more of these loans on the balance sheet.
The net growth in the commercial real estate (CRE) portfolio during the third quarter came mainly from the transition of construction and land development (C&D) loans to permanent status.
For the third quarter of 2013, average loans totaled $11.8 billion, up almost $200 million from the second quarter of 2013.
Deposits
Total deposits at September 30, 2013 were $15.1 billion, down $101 million, or less than 1%, from June 30, 2013. Average deposits for the third quarter of 2013 were $15.0 billion, down $190 million, or 1%, from the second quarter of 2013.
Noninterest-bearing demand deposits (DDAs) totaled $5.5 billion at September 30, 2013, up $140 million, or 3%, compared to June 30, 2013. DDAs comprised 36% of total period-end deposits at September 30, 2013.
Time deposits (CDs) and interest-bearing public fund deposits totaled $3.6 billion at September 30, 2013, down $283 million, or 7%, from June 30, 2013. As noted previously, public fund deposits typically reflect higher balances at year-end with subsequent reductions beginning in the second quarter and continuing into the third quarter.
- 2 -
Hancock reports third quarter 2013 financial results
October 24, 2013
Asset Quality
Non-performing assets (NPAs) totaled $216 million at September 30, 2013, slightly down from June 30, 2013. During the third quarter total non-performing loans declined $14 million, while foreclosed and surplus real estate (ORE) and other foreclosed assets increased almost $14 million. Approximately $16 million was transferred into ORE when certain bank locations were closed on August 30, 2013 in connection with the Companys efficiency initiative. Excluding the branch transfers, NPAs totaled $200 million at September 30, 2013, down $16 million from June 30, 2013. Non-performing assets as a percent of total loans, ORE and other foreclosed assets was 1.83% at September 30, 2013, compared to 1.84% at June 30, 2013.
The Companys total allowance for loan losses was $138.2 million at September 30, 2013, up slightly from $138.0 million at June 30, 2013. The ratio of the allowance to period-end loans was 1.18%, unchanged from June 30, 2013. The allowance maintained on the originated portion of the loan portfolio totaled $77.4 million, or 0.89% of related loans, at September 30, 2013, compared to $76.4 million, or 0.93% of related loans, at June 30, 2013.
Net charge-offs from the non-covered loan portfolio were $5.4 million, or 0.18% of average total loans on an annualized basis in the third quarter of 2013, down from $7.0 million, or 0.24% of average total loans in the second quarter of 2013.
During the third quarter of 2013, Hancock recorded a total provision for loan losses of $7.6 million, down from $8.3 million in the second quarter of 2013. The provision for non-covered loans was $6.5 million in the third quarter of 2013, compared to $7.9 million in the second quarter of 2013. The net provision from the covered portfolio was $1.0 million for the third quarter of 2013 compared to $0.4 million for the second quarter of 2013.
Net Interest Income
Net interest income (TE) for the third quarter of 2013 was $174.1 million, up $2.3 million from the second quarter of 2013. Average earning assets were $16.4 billion in the third quarter of 2013, down $116 million, or less than 1%, from the second quarter of 2013.
The linked-quarter increase reflected mainly a higher level of total purchase-accounting loan accretion on acquired loans in the third quarter, mainly related to excess cash recoveries which can be volatile. Approximately $7.7 million ($.06 per diluted common share) of excess cash recoveries was included in the third quarters results, while approximately $3.1 million ($.02 per diluted common share) was included in the second quarters results. The slide presentation referenced below includes detailed information on expected loan accretion and excess cash recoveries.
The net interest margin (TE) was 4.23% for the third quarter of 2013, up 6 basis points (bps) from the second quarter of 2013. The core margin of 3.37% (reported net interest income (TE) excluding total net purchase accounting adjustments, annualized, as a percent of average earning assets) compressed 1 basis point during the third quarter of 2013. The continued decline in the core loan yield was offset by improvement in the yield on investment securities and a slight decline in the cost of funds.
- 3 -
Hancock reports third quarter 2013 financial results
October 24, 2013
Noninterest Income
Noninterest income totaled $63.1 million for the third quarter of 2013, down $0.8 million from the second quarter of 2013.
Service charges on deposits totaled $20.5 million for the third quarter of 2013, up $0.7 million, or 3%, from the second quarter of 2013. Bankcard and ATM fees totaled $12.2 million, up $0.8 million, or 7%, from the second quarter of 2013.
Trust, investment and annuity, and insurance fees totaled $18.3 million, down $1.5 million, or 8%, from the second quarter of 2013. The linked-quarter decrease reflects some seasonality in these lines of business, in addition to the impact of higher equity market valuations in the second quarter of 2013.
Fees from secondary mortgage operations totaled $2.5 million for the third quarter of 2013, down $1.7 million, or 40%, linked-quarter. The decline mainly reflects a lower level of loans sold during the quarter as noted earlier. Mortgage loan activity also slowed towards the end of the third quarter, reflecting mainly the impact of increased longer-term interest rates on originations.
Noninterest Expense & Taxes
Noninterest expense for the third quarter of 2013 totaled $182.2 million, including $20.9 million of one-time costs related mainly to the expense and efficiency initiative. Excluding these costs, noninterest expense (or operating expense) totaled $161.3 million, down $0.9 million from the second quarter of 2013.
Total personnel expense, the largest component of the Companys expense base, was $86.9 million in the third quarter of 2013, down $0.7 million, or 1%, from the second quarter of 2013.
ORE expense totaled $2.4 million in the third quarter of 2013, down $0.9 million from the second quarter, while other operating expense of $47.2 million was up $0.7 million, or 1%, from the second quarter of 2013.
The Company remains on track to achieve its efficiency and expense reduction target for the first quarter of 2014. In August of 2013, the Company completed the previously announced closing of 26 branch locations across its five-state footprint. The sales of 10 additional branch locations, which were also announced previously, are subject to regulatory approvals and certain closing conditions, and will be reflected in Hancocks fourth quarter 2013 and first quarter of 2014 financial results.
- 4 -
Hancock reports third quarter 2013 financial results
October 24, 2013
The effective income tax rate for the third quarter of 2013 was 26%, up slightly from the second quarter of 2013. 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 totaled $2.4 billion at September 30, 2013 and the tangible common equity (TCE) ratio increased 16 bps to 8.68%. Management continues to review the strategic opportunities presented by Hancocks strong capital position, including additional stock buybacks, organic growth, acquisitions or increased dividends. 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 25, 2013 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. A slide presentation related to third quarter results is 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 31, 2013 by dialing (855) 859-2056 or (404) 537-3406, passcode 74981574.
About Hancock Holding Company
Hancock Holding Company is the parent company of Hancock Bank and Whitney Bank. The Company operates as Hancock Bank in south Mississippi, southern and central Alabama, and the northern, central, and panhandle regions of Florida; and as Whitney Bank in south Louisiana and Houston, Texas. The Hancock Holding Company family of financial services companies also includes Hancock Investment Services, Inc.; Hancock Insurance Agency and Whitney Insurance Agency, Inc.; corporate trust offices in Gulfport and Jackson, Mississippi, New Orleans and Baton Rouge, Louisiana, and Orlando, Florida; and Harrison Finance Company. Additional information is 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, loan growth, deposit trends, credit quality trends, future sales of nonperforming assets, net interest margin trends, future expense levels and the ability to achieve reductions in non-interest expense or other cost savings, projected tax rates, future profitability, improvements in expense to revenue (efficiency) ratio, purchase accounting impacts such as accretion levels, the impact of the branch rationalization process, and the financial impact of regulatory requirements.
Hancocks ability to accurately project results or predict the effects of future plans or strategies 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 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 outlined 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.
- 5 -
Hancock Holding Company
Financial Highlights
(amounts in thousands, except per share data and FTE headcount)
(unaudited)
Three Months Ended | Nine Months Ended | |||||||||||||||||||
9/30/2013 | 6/30/2013 | 9/30/2012 | 9/30/2013 | 9/30/2012 | ||||||||||||||||
Per Common Share Data |
||||||||||||||||||||
Earnings per share: |
||||||||||||||||||||
Basic |
$ | 0.40 | $ | 0.55 | $ | 0.55 | $ | 1.51 | $ | 1.23 | ||||||||||
Diluted |
$ | 0.40 | $ | 0.55 | $ | 0.55 | $ | 1.51 | $ | 1.22 | ||||||||||
Operating earnings per share: (a) |
||||||||||||||||||||
Basic |
$ | 0.56 | $ | 0.55 | $ | 0.58 | $ | 1.67 | $ | 1.61 | ||||||||||
Diluted |
$ | 0.56 | $ | 0.55 | $ | 0.58 | $ | 1.67 | $ | 1.60 | ||||||||||
Cash dividends per share |
$ | 0.24 | $ | 0.24 | $ | 0.24 | $ | 0.72 | $ | 0.72 | ||||||||||
Book value per share (period-end) |
$ | 28.70 | $ | 28.57 | $ | 28.71 | $ | 28.70 | $ | 28.71 | ||||||||||
Tangible book value per share (period-end) |
$ | 19.04 | $ | 18.83 | $ | 18.97 | $ | 19.04 | $ | 18.97 | ||||||||||
Weighted average number of shares: |
||||||||||||||||||||
Basic |
82,091 | 83,279 | 84,777 | 83,404 | 84,757 | |||||||||||||||
Diluted |
82,205 | 83,357 | 85,632 | 83,496 | 85,525 | |||||||||||||||
Period-end number of shares |
82,107 | 82,078 | 84,782 | 82,107 | 84,782 | |||||||||||||||
Market data: |
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High sales price |
$ | 33.85 | $ | 30.93 | $ | 33.27 | $ | 33.85 | $ | 36.73 | ||||||||||
Low sales price |
$ | 29.00 | $ | 25.00 | $ | 27.99 | $ | 25.00 | $ | 27.96 | ||||||||||
Period end closing price |
$ | 31.38 | $ | 30.07 | $ | 30.98 | $ | 31.38 | $ | 30.98 | ||||||||||
Trading volume |
29,711 | 38,599 | 26,877 | 97,779 | 98,609 | |||||||||||||||
Other Period-end Data |
||||||||||||||||||||
FTE headcount |
4,068 | 4,160 | 4,290 | 4,068 | 4,290 | |||||||||||||||
Tangible common equity |
$ | 1,563,542 | $ | 1,545,122 | $ | 1,608,285 | $ | 1,563,542 | $ | 1,608,285 | ||||||||||
Tier I capital |
$ | 1,657,136 | $ | 1,632,874 | $ | 1,631,372 | $ | 1,657,136 | $ | 1,631,372 | ||||||||||
Goodwill |
$ | 625,675 | $ | 625,675 | $ | 628,877 | $ | 625,675 | $ | 628,877 | ||||||||||
Amortizing intangibles |
$ | 167,116 | $ | 174,423 | $ | 197,139 | $ | 167,116 | $ | 197,139 | ||||||||||
Performance Ratios |
||||||||||||||||||||
Return on average assets |
0.70 | % | 0.99 | % | 1.00 | % | 0.91 | % | 0.74 | % | ||||||||||
Return on average assets (operating) (a) |
0.99 | % | 0.99 | % | 1.07 | % | 1.00 | % | 0.97 | % | ||||||||||
Return on average common equity |
5.63 | % | 7.82 | % | 7.77 | % | 7.18 | % | 5.86 | % | ||||||||||
Return on average common equity (operating) (a) |
7.93 | % | 7.82 | % | 8.24 | % | 7.93 | % | 7.68 | % | ||||||||||
Return on average tangible common equity |
8.54 | % | 11.74 | % | 11.87 | % | 10.80 | % | 9.06 | % | ||||||||||
Return on average tangible common equity (operating) (a) |
12.03 | % | 11.74 | % | 12.59 | % | 11.94 | % | 11.88 | % | ||||||||||
Tangible common equity ratio |
8.68 | % | 8.52 | % | 9.09 | % | 8.68 | % | 9.09 | % | ||||||||||
Earning asset yield (TE) |
4.47 | % | 4.42 | % | 4.84 | % | 4.50 | % | 4.82 | % | ||||||||||
Total cost of funds |
0.24 | % | 0.25 | % | 0.30 | % | 0.26 | % | 0.34 | % | ||||||||||
Net interest margin (TE) |
4.23 | % | 4.17 | % | 4.54 | % | 4.24 | % | 4.48 | % | ||||||||||
Efficiency ratio (b) |
64.95 | % | 65.68 | % | 64.33 | % | 64.93 | % | 65.93 | % | ||||||||||
Allowance for loan losses as a percent of period-end loans |
1.18 | % | 1.18 | % | 1.19 | % | 1.18 | % | 1.19 | % | ||||||||||
Allowance for loan losses to non-performing loans + accruing loans 90 days past due |
94.69 | % | 91.43 | % | 77.81 | % | 94.69 | % | 77.81 | % | ||||||||||
Average loan/deposit ratio |
78.70 | % | 76.41 | % | 75.85 | % | 76.80 | % | 74.14 | % | ||||||||||
Noninterest income excluding securities transactions as a percent of total revenue (TE) |
26.59 | % | 27.11 | % | 25.86 | % | 26.36 | % | 25.83 | % |
(a) | Excludes tax-effected securities transactions and one-time noninterest expense items. Management believes that operating income provides a useful measure of financial performance that helps investors compare the Companys fundamental operations over time. |
(b) | Efficiency ratio is defined as noninterest expense as a percent of total revenue (TE) before amortization of purchased intangibles, one-time noninterest expense items, and securities transactions. |
- 7 -
Hancock Holding Company
Financial Highlights
(amounts in thousands)
(unaudited)
Three Months Ended | Nine Months Ended | |||||||||||||||||||
9/30/2013 | 6/30/2013 | 9/30/2012 | 9/30/2013 | 9/30/2012 | ||||||||||||||||
Asset Quality Information |
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Non-accrual loans (c) |
$ | 100,649 | $ | 110,516 | $ | 135,499 | $ | 100,649 | $ | 135,499 | ||||||||||
Restructured loans (d) |
29,705 | 33,741 | 32,339 | 29,705 | 32,339 | |||||||||||||||
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Total non-performing loans |
130,354 | 144,257 | 167,838 | 130,354 | 167,838 | |||||||||||||||
ORE and foreclosed assets |
85,560 | 72,235 | 130,613 | 85,560 | 130,613 | |||||||||||||||
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Total non-performing assets |
$ | 215,914 | $ | 216,492 | $ | 298,451 | $ | 215,914 | $ | 298,451 | ||||||||||
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Non-performing assets as a percent of loans, ORE and foreclosed assets |
1.83 | % | 1.84 | % | 2.58 | % | 1.83 | % | 2.58 | % | ||||||||||
Accruing loans 90 days past due (c) |
$ | 15,620 | $ | 6,647 | $ | 6,423 | $ | 15,620 | $ | 6,423 | ||||||||||
Accruing loans 90 days past due as a percent of loans |
0.13 | % | 0.06 | % | 0.06 | % | 0.13 | % | 0.06 | % | ||||||||||
Non-performing assets + accruing loans 90 days past due to loans, ORE and foreclosed assets |
1.96 | % | 1.90 | % | 2.64 | % | 1.96 | % | 2.64 | % | ||||||||||
Net charge-offs - non-covered |
$ | 5,430 | $ | 7,032 | $ | 9,728 | $ | 19,095 | $ | 26,993 | ||||||||||
Net charge-offs - covered |
506 | 2,026 | 3,550 | 5,754 | 22,839 | |||||||||||||||
Net charge-offs - non-covered as a percent of average loans |
0.18 | % | 0.24 | % | 0.34 | % | 0.22 | % | 0.32 | % | ||||||||||
Allowance for loan losses |
$ | 138,223 | $ | 137,969 | $ | 135,591 | $ | 138,223 | $ | 135,591 | ||||||||||
Allowance for loan losses as a percent of period-end loans |
1.18 | % | 1.18 | % | 1.19 | % | 1.18 | % | 1.19 | % | ||||||||||
Allowance for loan losses to non-performing loans + accruing loans 90 days past due |
94.69 | % | 91.43 | % | 77.81 | % | 94.69 | % | 77.81 | % | ||||||||||
Provision for loan losses |
$ | 7,569 | $ | 8,257 | $ | 8,101 | $ | 25,404 | $ | 26,141 | ||||||||||
Allowance for Loan Losses |
||||||||||||||||||||
Beginning Balance |
$ | 137,969 | $ | 137,777 | $ | 140,768 | $ | 136,171 | $ | 124,881 | ||||||||||
Net provision for loan losses - covered loans |
1,024 | 362 | | 7,987 | 2,624 | |||||||||||||||
Provision for loan losses - non-covered loans |
6,545 | 7,895 | 8,101 | 17,417 | 23,517 | |||||||||||||||
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Net provision for loan losses |
7,569 | 8,257 | 8,101 | 25,404 | 26,141 | |||||||||||||||
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Increase (decrease) in FDIC loss share receivable |
(1,379 | ) | 993 | | 1,497 | 34,401 | ||||||||||||||
Charge-offs - non-covered |
8,698 | 11,451 | 12,211 | 31,386 | 34,588 | |||||||||||||||
Recoveries - non-covered |
(3,268 | ) | (4,419 | ) | (2,483 | ) | (12,291 | ) | (7,595 | ) | ||||||||||
Net charge-offs - covered |
506 | 2,026 | 3,550 | 5,754 | 22,839 | |||||||||||||||
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Net charge-offs |
5,936 | 9,058 | 13,278 | 24,849 | 49,832 | |||||||||||||||
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Ending Balance |
$ | 138,223 | $ | 137,969 | $ | 135,591 | $ | 138,223 | $ | 135,591 | ||||||||||
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Net Charge-off Information |
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Net charge-offs - non-covered: |
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Commercial/real estate loans |
$ | 1,267 | $ | 3,834 | $ | 3,905 | $ | 9,405 | $ | 13,811 | ||||||||||
Residential mortgage loans |
541 | 702 | 2,012 | 891 | 4,579 | |||||||||||||||
Consumer loans |
3,622 | 2,496 | 3,811 | 8,799 | 8,603 | |||||||||||||||
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Total net charge-offs - non-covered |
$ | 5,430 | $ | 7,032 | $ | 9,728 | $ | 19,095 | $ | 26,993 | ||||||||||
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Average loans: |
||||||||||||||||||||
Commercial/real estate loans |
$ | 8,582,849 | $ | 8,418,140 | $ | 8,018,634 | $ | 8,429,559 | $ | 7,994,444 | ||||||||||
Residential mortgage loans |
1,668,201 | 1,625,672 | 1,573,559 | 1,640,320 | 1,557,210 | |||||||||||||||
Consumer loans |
1,570,345 | 1,579,397 | 1,667,399 | 1,589,366 | 1,646,100 | |||||||||||||||
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Total average loans |
$ | 11,821,395 | $ | 11,623,209 | $ | 11,259,592 | $ | 11,659,245 | $ | 11,197,754 | ||||||||||
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Net charge-offs - non-covered to average loans: |
||||||||||||||||||||
Commercial/real estate loans |
0.06 | % | 0.18 | % | 0.19 | % | 0.15 | % | 0.23 | % | ||||||||||
Residential mortgage loans |
0.13 | % | 0.17 | % | 0.51 | % | 0.07 | % | 0.39 | % | ||||||||||
Consumer loans |
0.92 | % | 0.63 | % | 0.91 | % | 0.74 | % | 0.70 | % | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total net charge-offs - non-covered to average loans |
0.18 | % | 0.24 | % | 0.34 | % | 0.22 | % | 0.32 | % | ||||||||||
|
|
|
|
|
|
|
|
|
|
(c) | Non-accrual loans and accruing loans past due 90 days or more do not include non-accrual restructured loans and acquired credit-impaired loans which were written down to fair value upon acquisition and accrete interest income over the remaining life of the loan. |
(d) | Included in restructured loans are $19.1 million, $22.2 million, and $21.6 million in non-accrual loans at 9/30/13, 6/30/13, and 9/30/12, respectively. Total excludes acquired credit-impaired loans. |
- 8 -
Hancock Holding Company
Financial Highlights
(amounts in thousands)
(unaudited)
Three Months Ended | Nine Months Ended | |||||||||||||||||||
9/30/2013 | 6/30/2013 | 9/30/2012 | 9/30/2013 | 9/30/2012 | ||||||||||||||||
Income Statement |
||||||||||||||||||||
Interest income |
$ | 181,639 | $ | 179,649 | $ | 189,205 | $ | 546,560 | $ | 571,410 | ||||||||||
Interest income (TE) |
184,221 | 182,292 | 192,071 | 554,511 | 580,060 | |||||||||||||||
Interest expense |
10,109 | 10,470 | 11,949 | 31,836 | 40,407 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net interest income (TE) |
174,112 | 171,822 | 180,122 | 522,675 | 539,653 | |||||||||||||||
Provision for loan losses |
7,569 | 8,257 | 8,101 | 25,404 | 26,141 | |||||||||||||||
Noninterest income excluding securities transactions |
63,057 | 63,897 | 62,842 | 187,141 | 187,888 | |||||||||||||||
Securities transactions gains |
| | 917 | | 929 | |||||||||||||||
Noninterest expense |
182,205 | 162,250 | 169,714 | 504,057 | 555,149 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Income before income taxes |
44,813 | 62,569 | 63,200 | 172,404 | 138,530 | |||||||||||||||
Income tax expense |
11,611 | 15,707 | 16,216 | 43,764 | 33,747 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net income |
$ | 33,202 | $ | 46,862 | $ | 46,984 | $ | 128,640 | $ | 104,783 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Adjustments from net to operating income |
||||||||||||||||||||
Securities transactions gains |
| | 917 | | 929 | |||||||||||||||
One-time noninterest expense items |
||||||||||||||||||||
Merger-related expenses |
| | (38 | ) | | 45,789 | ||||||||||||||
Sub-debt early redemption costs |
| | 5,336 | | 5,336 | |||||||||||||||
Expense & efficiency initiative and other items |
20,887 | | | 20,887 | | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total one-time noninterest expense items |
20,887 | | 5,298 | 20,887 | 51,125 | |||||||||||||||
Taxes on adjustments at 35% |
7,310 | | 1,533 | 7,310 | 17,569 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total adjustments (net of taxes) |
13,577 | | 2,848 | 13,577 | 32,627 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Operating income (e) |
$ | 46,779 | $ | 46,862 | $ | 49,832 | $ | 142,217 | $ | 137,410 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Noninterest Income and Noninterest Expense |
||||||||||||||||||||
Service charges on deposit accounts |
$ | 20,519 | $ | 19,864 | $ | 20,834 | $ | 59,398 | $ | 58,015 | ||||||||||
Trust fees |
9,477 | 9,803 | 7,743 | 27,972 | 24,464 | |||||||||||||||
Bank card and ATM fees |
12,221 | 11,399 | 11,869 | 34,678 | 37,586 | |||||||||||||||
Investment & annuity fees |
5,186 | 5,192 | 4,269 | 14,955 | 13,291 | |||||||||||||||
Secondary mortgage market operations |
2,467 | 4,139 | 4,312 | 10,989 | 11,328 | |||||||||||||||
Insurance fees |
3,661 | 4,845 | 4,045 | 12,500 | 12,103 | |||||||||||||||
Other income |
9,526 | 8,655 | 9,770 | 26,649 | 31,101 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Noninterest income excluding securities transactions |
63,057 | 63,897 | 62,842 | 187,141 | 187,888 | |||||||||||||||
Securities transactions gains |
| | 917 | | 929 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total noninterest income including securities transactions |
$ | 63,057 | $ | 63,897 | $ | 63,759 | $ | 187,141 | $ | 188,817 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Personnel expense |
$ | 86,850 | $ | 87,595 | $ | 88,176 | $ | 262,372 | $ | 269,376 | ||||||||||
Occupancy expense (net) |
12,369 | 12,404 | 13,169 | 37,099 | 41,173 | |||||||||||||||
Equipment expense |
5,120 | 4,919 | 5,010 | 15,340 | 16,811 | |||||||||||||||
Other real estate owned expense (net) |
2,439 | 3,355 | 4,590 | 6,502 | 10,014 | |||||||||||||||
Other operating expense |
47,234 | 46,546 | 45,361 | 139,565 | 142,314 | |||||||||||||||
Amortization of intangibles |
7,306 | 7,431 | 8,110 | 22,292 | 24,336 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total operating expense |
161,318 | 162,250 | 164,416 | 483,170 | 504,024 | |||||||||||||||
One-time noninterest expense items |
20,887 | | 5,298 | 20,887 | 51,125 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total noninterest expense |
$ | 182,205 | $ | 162,250 | $ | 169,714 | $ | 504,057 | $ | 555,149 | ||||||||||
|
|
|
|
|
|
|
|
|
|
(e) | Net income less tax-effected securities gains/losses and one-time noninterest expense items. Management believes that operating income provides a useful measure of financial performance that helps investors compare the Companys fundamental operations over time. |
- 9 -
Hancock Holding Company
Financial Highlights
(amounts in thousands)
(unaudited)
Three Months Ended | ||||||||||||||||||||
9/30/2013 | 6/30/2013 | 3/31/2013 | 12/31/2012 | 9/30/2012 | ||||||||||||||||
Period-end Balance Sheet |
||||||||||||||||||||
Commercial non-real estate loans |
$ | 4,625,315 | $ | 4,653,342 | $ | 4,425,286 | $ | 4,433,288 | $ | 4,235,823 | ||||||||||
Construction and land development loans |
920,408 | 966,499 | 992,820 | 989,306 | 1,044,637 | |||||||||||||||
Commercial real estate loans |
2,914,969 | 2,872,254 | 2,873,403 | 2,923,094 | 2,907,007 | |||||||||||||||
Residential mortgage loans |
1,695,197 | 1,616,093 | 1,587,519 | 1,577,944 | 1,561,640 | |||||||||||||||
Consumer loans |
1,578,583 | 1,573,309 | 1,603,734 | 1,654,170 | 1,685,341 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total loans |
11,734,472 | 11,681,497 | 11,482,762 | 11,577,802 | 11,434,448 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Loans held for sale |
18,444 | 20,233 | 34,813 | 50,605 | 50,389 | |||||||||||||||
Securities |
4,124,202 | 4,303,918 | 4,662,279 | 3,716,460 | 4,053,271 | |||||||||||||||
Short-term investments |
462,313 | 442,917 | 475,677 | 1,500,188 | 320,057 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Earning assets |
16,339,431 | 16,448,565 | 16,655,531 | 16,845,055 | 15,858,165 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Allowance for loan losses |
(138,223 | ) | (137,969 | ) | (137,777 | ) | (136,171 | ) | (135,591 | ) | ||||||||||
Other assets |
2,600,638 | 2,623,705 | 2,546,369 | 2,755,601 | 2,800,472 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total assets |
$ | 18,801,846 | $ | 18,934,301 | $ | 19,064,123 | $ | 19,464,485 | $ | 18,523,046 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Noninterest bearing deposits |
$ | 5,479,696 | $ | 5,340,177 | $ | 5,418,463 | $ | 5,624,127 | $ | 5,151,146 | ||||||||||
Interest bearing transaction and savings deposits |
6,008,042 | 5,965,372 | 6,017,735 | 6,038,003 | 5,876,638 | |||||||||||||||
Interest bearing public fund deposits |
1,240,336 | 1,410,866 | 1,528,790 | 1,580,260 | 1,321,227 | |||||||||||||||
Time deposits |
2,326,797 | 2,439,523 | 2,288,363 | 2,501,798 | 2,423,940 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total interest bearing deposits |
9,575,175 | 9,815,761 | 9,834,888 | 10,120,061 | 9,621,805 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total deposits |
15,054,871 | 15,155,938 | 15,253,351 | 15,744,188 | 14,772,951 | |||||||||||||||
Short-term borrowings |
782,779 | 828,107 | 722,537 | 639,133 | 748,634 | |||||||||||||||
Long-term debt |
376,664 | 385,122 | 393,920 | 396,589 | 308,327 | |||||||||||||||
Other liabilities |
231,090 | 219,794 | 217,215 | 231,297 | 258,646 | |||||||||||||||
Common shareholders equity |
2,356,442 | 2,345,340 | 2,477,100 | 2,453,278 | 2,434,488 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total liabilities & common equity |
$ | 18,801,846 | $ | 18,934,301 | $ | 19,064,123 | $ | 19,464,485 | $ | 18,523,046 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Capital Ratios |
||||||||||||||||||||
Common shareholders equity |
$ | 2,356,442 | $ | 2,345,340 | $ | 2,477,100 | $ | 2,453,278 | $ | 2,434,488 | ||||||||||
Tier 1 capital (f) |
1,657,136 | 1,632,874 | 1,700,115 | 1,668,809 | 1,631,372 | |||||||||||||||
Tangible common equity ratio |
8.68 | % | 8.52 | % | 9.14 | % | 8.77 | % | 9.09 | % | ||||||||||
Common equity (period-end) as a percent of total assets (period-end) |
12.53 | % | 12.39 | % | 12.99 | % | 12.60 | % | 13.14 | % | ||||||||||
Leverage (Tier 1) ratio (f) |
9.17 | % | 8.96 | % | 9.28 | % | 9.11 | % | 9.17 | % | ||||||||||
Tier 1 risk-based capital ratio (f) |
12.16 | % | 11.98 | % | 12.78 | % | 12.64 | % | 12.49 | % | ||||||||||
Total risk-based capital ratio (f) |
13.62 | % | 13.43 | % | 14.41 | % | 14.28 | % | 14.14 | % |
(f) | Estimated for most recent period-end. |
- 10 -
Hancock Holding Company
Financial Highlights
(amounts in thousands)
(unaudited)
Three Months Ended | Nine Months Ended | |||||||||||||||||||
9/30/2013 | 6/30/2013 | 9/30/2012 | 9/30/2013 | 9/30/2012 | ||||||||||||||||
Average Balance Sheet |
||||||||||||||||||||
Commercial non-real estate loans |
$ | 4,720,608 | $ | 4,539,259 | $ | 4,056,457 | $ | 4,558,934 | $ | 3,903,767 | ||||||||||
Construction and land development loans |
970,411 | 984,449 | 1,092,181 | 976,702 | 1,197,915 | |||||||||||||||
Commercial real estate loans |
2,891,830 | 2,894,432 | 2,869,996 | 2,893,923 | 2,892,762 | |||||||||||||||
Residential mortgage loans |
1,668,201 | 1,625,672 | 1,573,559 | 1,640,320 | 1,557,210 | |||||||||||||||
Consumer loans |
1,570,345 | 1,579,397 | 1,667,399 | 1,589,366 | 1,646,100 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total loans (g) |
11,821,395 | 11,623,209 | 11,259,592 | 11,659,245 | 11,197,754 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Securities (h) |
4,135,348 | 4,423,441 | 4,039,191 | 4,163,436 | 4,174,956 | |||||||||||||||
Short-term investments |
427,892 | 453,565 | 531,195 | 644,349 | 705,205 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Earning assets |
16,384,635 | 16,500,215 | 15,829,978 | 16,467,030 | 16,077,915 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Allowance for loan losses |
(137,936 | ) | (137,815 | ) | (140,661 | ) | (137,624 | ) | (136,257 | ) | ||||||||||
Other assets |
2,549,328 | 2,660,432 | 2,909,649 | 2,659,791 | 2,983,774 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total assets |
$ | 18,796,027 | $ | 19,022,832 | $ | 18,598,966 | $ | 18,989,197 | $ | 18,925,432 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Noninterest bearing deposits |
$ | 5,415,303 | $ | 5,346,916 | $ | 5,076,152 | $ | 5,359,325 | $ | 5,194,751 | ||||||||||
Interest bearing transaction and savings deposits |
5,919,709 | 5,965,769 | 5,869,281 | 5,955,711 | 5,792,586 | |||||||||||||||
Interest bearing public fund deposits |
1,302,425 | 1,483,267 | 1,426,405 | 1,463,750 | 1,491,514 | |||||||||||||||
Time deposits |
2,384,248 | 2,415,411 | 2,473,450 | 2,402,061 | 2,624,039 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total interest bearing deposits |
9,606,382 | 9,864,447 | 9,769,136 | 9,821,522 | 9,908,139 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total deposits |
15,021,685 | 15,211,363 | 14,845,288 | 15,180,847 | 15,102,890 | |||||||||||||||
Short-term borrowings |
820,500 | 790,103 | 794,925 | 791,641 | 842,702 | |||||||||||||||
Long-term debt |
385,203 | 393,641 | 317,379 | 391,712 | 344,638 | |||||||||||||||
Other liabilities |
229,694 | 222,656 | 236,134 | 228,056 | 245,940 | |||||||||||||||
Common shareholders equity |
2,338,945 | 2,405,069 | 2,405,240 | 2,396,941 | 2,389,262 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total liabilities & common equity |
$ | 18,796,027 | $ | 19,022,832 | $ | 18,598,966 | $ | 18,989,197 | $ | 18,925,432 | ||||||||||
|
|
|
|
|
|
|
|
|
|
(g) | Includes loans held for sale |
(h) | Average securities does not include unrealized holding gains/losses on available for sale securities. |
- 11 -
Hancock Holding Company
Average Balance and Net Interest Margin Summary
(amounts in thousands)
(unaudited)
Three Months Ended | ||||||||||||||||||||||||||||||||||||
9/30/2013 | 6/30/2013 | 9/30/2012 | ||||||||||||||||||||||||||||||||||
Interest | Volume | Rate | Interest | Volume | Rate | Interest | Volume | Rate | ||||||||||||||||||||||||||||
Average Earning Assets |
||||||||||||||||||||||||||||||||||||
Commercial & real estate loans (TE) |
$ | 109,450 | $ | 8,582,849 | 5.06 | % | $ | 103,344 | $ | 8,418,140 | 4.92 | % | $ | 109,069 | $ | 8,018,634 | 5.41 | % | ||||||||||||||||||
Residential mortgage loans |
24,968 | 1,668,201 | 5.99 | % | 27,540 | 1,625,672 | 6.78 | % | 28,533 | 1,573,559 | 7.25 | % | ||||||||||||||||||||||||
Consumer loans |
25,740 | 1,570,345 | 6.51 | % | 26,534 | 1,579,397 | 6.74 | % | 29,942 | 1,667,399 | 7.14 | % | ||||||||||||||||||||||||
Loan fees & late charges |
689 | | 0.00 | % | 1,236 | | 0.00 | % | 891 | | 0.00 | % | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Total loans (TE) |
160,847 | 11,821,395 | 5.41 | % | 158,654 | 11,623,209 | 5.47 | % | 168,435 | 11,259,592 | 5.95 | % | ||||||||||||||||||||||||
US Treasury and government agency securities |
33 | 5,585 | 2.34 | % | 1 | 150 | 2.67 | % | 51 | 18,419 | 1.10 | % | ||||||||||||||||||||||||
CMOs |
7,278 | 1,463,403 | 1.99 | % | 7,454 | 1,589,017 | 1.88 | % | 7,820 | 1,663,741 | 1.88 | % | ||||||||||||||||||||||||
Mortgage backed securities |
13,042 | 2,410,763 | 2.16 | % | 13,217 | 2,593,270 | 2.04 | % | 12,530 | 2,097,097 | 2.39 | % | ||||||||||||||||||||||||
Municipals (TE) |
2,715 | 247,140 | 4.39 | % | 2,630 | 232,987 | 4.51 | % | 2,864 | 252,771 | 4.51 | % | ||||||||||||||||||||||||
Other securities |
53 | 8,457 | 2.51 | % | 56 | 8,017 | 2.79 | % | 63 | 7,163 | 3.58 | % | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Total securities (TE) (i) |
23,121 | 4,135,348 | 2.24 | % | 23,358 | 4,423,441 | 2.11 | % | 23,328 | 4,039,191 | 2.30 | % | ||||||||||||||||||||||||
Total short-term investments |
253 | 427,892 | 0.23 | % | 280 | 453,565 | 0.25 | % | 308 | 531,195 | 0.23 | % | ||||||||||||||||||||||||
Average earning assets yield (TE) |
$ | 184,221 | $ | 16,384,635 | 4.47 | % | $ | 182,292 | $ | 16,500,215 | 4.42 | % | $ | 192,071 | $ | 15,829,978 | 4.84 | % | ||||||||||||||||||
Interest-bearing Liabilities |
||||||||||||||||||||||||||||||||||||
Interest-bearing transaction and savings deposits |
$ | 1,398 | $ | 5,919,709 | 0.09 | % | $ | 1,542 | $ | 5,965,769 | 0.10 | % | $ | 1,688 | $ | 5,869,281 | 0.11 | % | ||||||||||||||||||
Time deposits |
3,687 | 2,384,248 | 0.61 | % | 3,795 | 2,415,411 | 0.63 | % | 4,829 | 2,473,450 | 0.78 | % | ||||||||||||||||||||||||
Public funds |
766 | 1,302,425 | 0.23 | % | 852 | 1,483,267 | 0.23 | % | 1,002 | 1,426,405 | 0.28 | % | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Total interest bearing deposits |
5,851 | 9,606,382 | 0.24 | % | 6,189 | 9,864,447 | 0.25 | % | 7,519 | 9,769,136 | 0.31 | % | ||||||||||||||||||||||||
Short-term borrowings |
1,074 | 820,500 | 0.52 | % | 1,058 | 790,103 | 0.54 | % | 1,522 | 794,925 | 0.76 | % | ||||||||||||||||||||||||
Long-term debt |
3,184 | 385,203 | 3.28 | % | 3,223 | 393,641 | 3.28 | % | 2,908 | 317,379 | 3.65 | % | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Total borrowings |
4,258 | 1,205,703 | 1.40 | % | 4,281 | 1,183,744 | 1.45 | % | 4,430 | 1,112,304 | 1.58 | % | ||||||||||||||||||||||||
Total interest bearing liabilities cost |
$ | 10,109 | $ | 10,812,085 | 0.37 | % | $ | 10,470 | $ | 11,048,191 | 0.38 | % | $ | 11,949 | $ | 10,881,440 | 0.44 | % | ||||||||||||||||||
Net interest-free funding sources |
5,572,550 | 5,452,024 | 4,948,538 | |||||||||||||||||||||||||||||||||
Total Cost of Funds |
$ | 10,109 | $ | 16,384,635 | 0.24 | % | $ | 10,470 | $ | 16,500,215 | 0.25 | % | $ | 11,949 | $ | 15,829,978 | 0.30 | % | ||||||||||||||||||
Net Interest Spread (TE) |
$ | 174,112 | 4.10 | % | $ | 171,822 | 4.04 | % | $ | 180,122 | 4.40 | % | ||||||||||||||||||||||||
Net Interest Margin (TE) |
$ | 174,112 | $ | 16,384,635 | 4.23 | % | $ | 171,822 | $ | 16,500,215 | 4.17 | % | $ | 180,122 | $ | 15,829,978 | 4.54 | % |
(i) | 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
(amounts in thousands)
(unaudited)
Nine Months Ended | ||||||||||||||||||||||||
9/30/2013 | 9/30/2012 | |||||||||||||||||||||||
Interest | Volume | Rate | Interest | Volume | Rate | |||||||||||||||||||
Average Earning Assets |
||||||||||||||||||||||||
Commercial & real estate loans (TE) |
$ | 326,090 | $ | 8,429,559 | 5.17 | % | $ | 330,355 | $ | 7,994,444 | 5.52 | % | ||||||||||||
Residential mortgage loans |
78,188 | 1,640,320 | 6.36 | % | 83,664 | 1,557,210 | 7.16 | % | ||||||||||||||||
Consumer loans |
78,775 | 1,589,366 | 6.63 | % | 86,876 | 1,646,100 | 7.05 | % | ||||||||||||||||
Loan fees & late charges |
2,493 | | 0.00 | % | 3,238 | | 0.00 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total loans (TE) |
485,546 | 11,659,245 | 5.56 | % | 504,133 | 11,197,754 | 6.01 | % | ||||||||||||||||
US Treasury and government agency securities |
51 | 3,771 | 1.81 | % | 2,052 | 126,273 | 2.17 | % | ||||||||||||||||
CMOs |
21,823 | 1,528,825 | 1.90 | % | 22,586 | 1,534,909 | 1.96 | % | ||||||||||||||||
Mortgage backed securities |
37,864 | 2,390,098 | 2.11 | % | 40,858 | 2,237,794 | 2.43 | % | ||||||||||||||||
Municipals (TE) |
7,899 | 232,478 | 4.53 | % | 8,872 | 267,793 | 4.42 | % | ||||||||||||||||
Other securities |
150 | 8,264 | 2.42 | % | 255 | 8,187 | 4.15 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total securities (TE) (j) |
67,787 | 4,163,436 | 2.17 | % | 74,623 | 4,174,956 | 2.39 | % | ||||||||||||||||
Total short-term investments |
1,178 | 644,349 | 0.24 | % | 1,304 | 705,205 | 0.25 | % | ||||||||||||||||
Average earning assets yield (TE) |
$ | 554,511 | $ | 16,467,030 | 4.50 | % | $ | 580,060 | $ | 16,077,915 | 4.82 | % | ||||||||||||
Interest-Bearing Liabilities |
||||||||||||||||||||||||
Interest-bearing transaction deposits |
$ | 4,599 | $ | 5,955,711 | 0.10 | % | $ | 5,634 | $ | 5,792,586 | 0.13 | % | ||||||||||||
Time deposits |
11,568 | 2,402,061 | 0.64 | % | 16,735 | 2,624,039 | 0.85 | % | ||||||||||||||||
Public funds |
2,618 | 1,463,750 | 0.24 | % | 3,285 | 1,491,514 | 0.29 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total interest bearing deposits |
18,785 | 9,821,522 | 0.26 | % | 25,654 | 9,908,139 | 0.35 | % | ||||||||||||||||
Short-term borrowings |
3,450 | 791,641 | 0.58 | % | 4,792 | 842,702 | 0.76 | % | ||||||||||||||||
Long-term debt |
9,601 | 391,712 | 3.28 | % | 9,961 | 344,638 | 3.86 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total borrowings |
13,051 | 1,183,353 | 1.47 | % | 14,753 | 1,187,340 | 1.66 | % | ||||||||||||||||
Total interest bearing liabilities cost |
$ | 31,836 | $ | 11,004,875 | 0.39 | % | $ | 40,407 | $ | 11,095,479 | 0.49 | % | ||||||||||||
Net interest-free funding sources |
5,462,155 | 4,982,436 | ||||||||||||||||||||||
Total Cost of Funds |
$ | 31,836 | $ | 16,467,030 | 0.26 | % | $ | 40,407 | $ | 16,077,915 | 0.34 | % | ||||||||||||
Net Interest Spread (TE) |
$ | 522,675 | 4.11 | % | $ | 539,653 | 4.33 | % | ||||||||||||||||
Net Interest Margin (TE) |
$ | 522,675 | $ | 16,467,030 | 4.24 | % | $ | 539,653 | $ | 16,077,915 | 4.48 | % |
(j) | Average securities does not include unrealized holding gains/losses on available for sale securities. |
- 13 -
Hancock Holding Company
Quarterly Financial Data
(amounts in thousands, except per share data and FTE headcount)
(unaudited)
Three Months Ended | ||||||||||||||||||||
9/30/2013 | 6/30/2013 | 3/31/2013 | 12/31/2012 | 9/30/2012 | ||||||||||||||||
Per Common Share Data |
||||||||||||||||||||
Earnings per share: |
||||||||||||||||||||
Basic |
$ | 0.40 | $ | 0.55 | $ | 0.56 | $ | 0.55 | $ | 0.55 | ||||||||||
Diluted |
$ | 0.40 | $ | 0.55 | $ | 0.56 | $ | 0.54 | $ | 0.55 | ||||||||||
Operating earnings per share: (k) |
||||||||||||||||||||
Basic |
$ | 0.56 | $ | 0.55 | $ | 0.56 | $ | 0.54 | $ | 0.58 | ||||||||||
Diluted |
$ | 0.56 | $ | 0.55 | $ | 0.56 | $ | 0.54 | $ | 0.58 | ||||||||||
Cash dividends per share |
$ | 0.24 | $ | 0.24 | $ | 0.24 | $ | 0.24 | $ | 0.24 | ||||||||||
Book value per share (period-end) |
$ | 28.70 | $ | 28.57 | $ | 29.18 | $ | 28.91 | $ | 28.71 | ||||||||||
Tangible book value per share (period-end) |
$ | 19.04 | $ | 18.83 | $ | 19.67 | $ | 19.27 | $ | 18.97 | ||||||||||
Weighted average number of shares: |
||||||||||||||||||||
Basic |
82,091 | 83,279 | 84,871 | 84,798 | 84,777 | |||||||||||||||
Diluted |
82,205 | 83,357 | 84,972 | 85,777 | 85,632 | |||||||||||||||
Period-end number of shares |
82,107 | 82,078 | 84,882 | 84,848 | 84,782 | |||||||||||||||
Market data: |
||||||||||||||||||||
High sales price |
$ | 33.85 | $ | 30.93 | $ | 33.59 | $ | 32.50 | $ | 33.27 | ||||||||||
Low sales price |
$ | 29.00 | $ | 25.00 | $ | 29.37 | $ | 29.47 | $ | 27.99 | ||||||||||
Period end closing price |
$ | 31.38 | $ | 30.07 | $ | 30.92 | $ | 31.73 | $ | 30.98 | ||||||||||
Trading volume |
29,711 | 38,599 | 29,469 | 20,910 | 26,877 | |||||||||||||||
Other Period-end Data |
||||||||||||||||||||
FTE headcount |
4,068 | 4,160 | 4,197 | 4,235 | 4,290 | |||||||||||||||
Tangible common equity |
$ | 1,563,542 | $ | 1,545,122 | $ | 1,669,435 | $ | 1,634,833 | $ | 1,608,285 | ||||||||||
Tier I capital |
$ | 1,657,136 | $ | 1,632,874 | $ | 1,700,115 | $ | 1,668,809 | $ | 1,631,372 | ||||||||||
Goodwill |
$ | 625,675 | $ | 625,675 | $ | 625,675 | $ | 628,877 | $ | 628,877 | ||||||||||
Amortizing intangibles |
$ | 167,116 | $ | 174,423 | $ | 181,853 | $ | 189,409 | $ | 197,139 | ||||||||||
Performance Ratios |
||||||||||||||||||||
Return on average assets |
0.70 | % | 0.99 | % | 1.03 | % | 0.99 | % | 1.00 | % | ||||||||||
Return on average assets (operating) (k) |
0.99 | % | 0.99 | % | 1.03 | % | 0.98 | % | 1.07 | % | ||||||||||
Return on average common equity |
5.63 | % | 7.82 | % | 8.05 | % | 7.67 | % | 7.77 | % | ||||||||||
Return on average common equity (operating) (k) |
7.93 | % | 7.82 | % | 8.05 | % | 7.60 | % | 8.24 | % | ||||||||||
Return on average tangible common equity |
8.54 | % | 11.74 | % | 12.04 | % | 11.58 | % | 11.87 | % | ||||||||||
Return on average tangible common equity (operating) (k) |
12.03 | % | 11.74 | % | 12.04 | % | 11.48 | % | 12.59 | % | ||||||||||
Tangible common equity ratio |
8.68 | % | 8.52 | % | 9.14 | % | 8.77 | % | 9.09 | % | ||||||||||
Earning asset yield (TE) |
4.47 | % | 4.42 | % | 4.60 | % | 4.76 | % | 4.84 | % | ||||||||||
Total cost of funds |
0.24 | % | 0.25 | % | 0.28 | % | 0.28 | % | 0.30 | % | ||||||||||
Net interest margin (TE) |
4.23 | % | 4.17 | % | 4.32 | % | 4.48 | % | 4.54 | % | ||||||||||
Efficiency ratio (l) |
64.95 | % | 65.68 | % | 64.17 | % | 60.78 | % | 64.33 | % | ||||||||||
Allowance for loan losses as a percent of period-end loans |
1.18 | % | 1.18 | % | 1.20 | % | 1.18 | % | 1.19 | % | ||||||||||
Allowance for loan losses to non-performing loans + accruing loans 90 days past due |
94.69 | % | 91.43 | % | 87.34 | % | 81.40 | % | 77.81 | % | ||||||||||
Average loan/deposit ratio |
78.70 | % | 76.41 | % | 75.30 | % | 76.29 | % | 75.85 | % | ||||||||||
Noninterest income excluding securities transactions as a percent of total revenue (TE) |
26.59 | % | 27.11 | % | 25.40 | % | 26.02 | % | 25.86 | % |
(k) | Excludes tax-effected securities transactions and one-time noninterest expense items. Management believes that operating income provides a useful measure of financial performance that helps investors compare the Companys fundamental operations over time. |
(l) | Efficiency ratio is defined as noninterest expense as a percent of total revenue (TE) before amortization of purchased intangibles, one-time noninterest expense items, and securities transactions. |
- 14 -
Third Quarter 2013
Financial Results
October
24, 2013
Third Quarter 2013
Financial Results
October
24, 2013 |
Forward-Looking
Statements
Forward-Looking
Statements
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.
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, loan
growth, deposit trends, credit quality trends, future sales of
nonperforming assets, net interest margin trends, future expense levels and the
ability to achieve reductions in non-interest expense or other cost
savings, projected tax rates, future profitability, improvements
in expense to revenue (efficiency) ratio, purchase accounting impacts such as
accretion levels, the impact of the branch rationalization process, and
the financial impact of regulatory requirements.
Hancocks ability to accurately project results or predict the effects of future plans or
strategies 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, 2012 and most recent form 10-Q.
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. 2
|
Net income (operating) $47 million or
$.56 per diluted common share
An increase of $4.6 million in loan accretion,
or $.04 per diluted common share, from excess
cash recoveries
$20.9 million of certain one-time noninterest
expense items
ROA (operating) 0.99%
ROTCE (operating) 12.03%
Net loan growth (excluding covered loans),
up 3% linked-quarter annualized
Core net interest income (TE) and NIM stable
Remain on track to meet 1Q14 expense target
Improved asset quality metrics
Third Quarter Highlights
Third Quarter Highlights
3
Operating income is defined as net income excluding tax-effected
securities transactions gains or losses and one-time noninterest expense items.
Core is defined as reported results less purchase accounting
adjustments. See table on slide 11. **
Noninterest
expense
as
a
percent
of
total
revenue
(TE)
before
amortization
of
purchased
intangibles
and
one-time
noninterest
expense
items.
($s in millions; except per share
data)
3Q13
2Q13
LQ
change
Operating Income
$46.8
$46.9
---
Earnings Per Share (diluted) -
operating
$.56
$.55
+2%
Net Income
$33.2
$46.9
-29%
Earnings Per Share (diluted)
$.40
$.55
-27%
One-time noninterest expense
items
$20.9
---
n/m
Return on Assets (operating) (%)
0.99
0.99
---
Return on Tangible Common
Equity (operating) (%)
12.03
11.74
+29bps
Total Loans (excluding covered
loans)
$11,343
$11,251
+1%
Net Interest Margin (%)
4.23
4.17
+6bps
Net Interest Margin (%) (core)*
3.37
3.38
-1bp
Net Charge-offs (%)
(non-covered)
0.18
0.24
-6bps
Tangible Common Equity (%)
8.68
8.52
+16bps
Efficiency Ratio** (operating)
(%)
64.95
65.68
-73bps |
Strong Originations Offset By Payoff
Strong Originations Offset By Payoff
Activity
Activity
Excluding the FDIC covered loans, total loans of
$11.3 billion were up $92 million, or 3%, LQA
Solid origination activity commercial customers
across the footprint, especially in south Louisiana,
was offset by higher than normal paydowns and
payoffs as well as some seasonal net reductions
Linked-quarter growth in mortgage lending
reflects a strategic decision to retain more
mortgage loans on the balance sheet
Net growth in the commercial real estate (CRE)
portfolio came mainly from the transition of
construction and land development (C&D) loans
to permanent status
Period-end
balances.
As
of
September
30,
2013
4
$s in millions
$s in millions |
Whitney Portfolio Continues
Whitney Portfolio Continues
Solid Performance
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 5
$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 9/30/13
$146
$40
$186
Remaining acquired portfolio loan balances at
9/30/13
$214
$2,617
$2,831
Acquired loan charge-offs from acquisition thru
9/30/13
$28
$9
$37
Discount at 9/30/13
68%
1.5%
6.6%
As of September 30, 2013 |
Peoples First Loan Mark Used
Peoples First Loan Mark Used
For Charge-Offs
For Charge-Offs
FDIC covered 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
$124
million
at
September
30,
2013
Balance reflects the total amount expected to be collected from the
FDIC 6
$s in millions
Credit Impaired
Peoples First loan mark at acquisition (12/2009)
$509
Charge-offs from acquisition thru 9/30/13
$407
Accretion since acquisition date
$82
Remaining loan mark at 9/30/13
$63
Impairment reserve at 9/30/13
$60
Remaining acquired portfolio loan balances at 9/30/13
$455
Discount & allowance at 9/30/13
27%
As of September 30, 2013 |
Nonperforming assets totaled $200 million
(excluding impact of closed branches in 3Q13)
Bank branches closed in August and transferred to ORE
totaled $16.4 million
ORE and foreclosed assets (excluding impact of closed
branches) declined $3.1 million linked-quarter
Nonperforming loans down $13.9 million, or 10%,
compared to 2Q13
Provision for loan losses was $7.6 million, down
from $8.3 million in 2Q13
3Q13 includes $6.5 million for the non-covered loan
portfolio, compared to $7.9 million in 2Q13
3Q13 includes $1.0 million impact from covered loan
portfolio, compared to $0.4 million in 2Q13
Non-covered net charge-offs totaled $5.4 million, or
0.18%, compared to $7.0 million, or 0.24%, in 2Q13
Allowance for loan losses/loans 1.18%, unchanged
linked-quarter
Improved Asset Quality Metrics
Improved Asset Quality Metrics
7
$s in millions
Excludes covered portfolio and gross of the Whitney loan mark
As of September 30, 2013 |
Securities Portfolio Funded Loan
Growth in Third Quarter
Securities Portfolio Funded Loan
Growth in Third Quarter
8
Portfolio totaled $4.1 billion, down $180 million
linked-quarter
Decline during 3Q13 funded loan growth and
deposit runoff
Better earning asset mix
Yield 2.24% for 3Q13, up 13 bps
Premium amortization declined $2.1 million linked-quarter
Unrealized gain (net) of $22.3 million on AFS
Transferred securities to held-to-maturity from
available-for-sale during the quarter
65% HTM, 35% AFS
Protects TCE in a rising rate environment
Duration 3.84, virtually unchanged linked-quarter
Extends to 4.2 in +100 bps shift in the yield curve
Extends to 4.5 in +200 bps shift in the yield curve
Period-end balances. As of September 30, 2013
$s in millions |
Strong Core Deposit
Strong Core Deposit
Funding
Funding
Total deposits $15.1 billion, down
approximately $100 million
DDA of $5.5 billion, up $140 million
linked-quarter
Overall decrease mainly related to a decline
in CDs and public funds
Funding mix remained strong
Noninterest-bearing demand deposits (DDA)
comprised 36% of total period-end deposits
No and low cost deposits comprised 76% of total
period-end deposits
Cost of funds declined 1bp to 24 bps
9
Period-end balances. As of September 30, 2013
$s in millions
$s in millions |
Core NIM Stabilizing, Reported NIM
Core NIM Stabilizing, Reported NIM
Impacted By Purchase Accounting Adjustments
Impacted By Purchase Accounting Adjustments
Reported net interest margin (NIM) 4.23%, up 6 bps
linked-quarter Approximately 7 bps of NIM expansion related
to $2.9 million increase in net purchase accounting adjustments
linked-quarter Decline in loan yield offset by increased
yield on securities portfolio and a lower cost of funds Better
yield on new originations (up 30 bps from 2Q13)
Core NIM relatively stable (down 1bp)
10
Core NIM = reported net interest income (TE) excluding total net
purchase accounting adjustments, annualized, as a percent of
average earning assets. (See slide 11)
As of September 30, 2013 |
Purchase Accounting Adjustments
Core NII & NIM Reconciliation
Purchase Accounting Adjustments
Core NII & NIM Reconciliation
11
($s in millions)
3Q13
2Q13
1Q13
4Q12
3Q12
Net Interest Income (TE)
reported (NII)
$174.1
$171.8
$176.7
$182.8
$180.1
Whitney expected loan accretion (performing)
10.4
12.8
13.7
17.6
17.4
Whitney expected loan accretion (credit impaired)
15.8
15.9
14.6
11.5
7.9
Peoples First expected loan accretion
4.3
4.1
4.5
7.4
11.7
Excess cash recoveries*
7.7
3.1
7.5
4.0
---
Total Loan Accretion
$38.3
$35.9
$40.3
$40.5
$37.0
Whitney premium bond amortization
(2.8)
(3.4)
(3.5)
(5.4)
(5.8)
Whitney and Peoples First CD accretion
.1
.2
.3
.3
.4
Total Net Purchase Accounting
Adjustments (PAAs) impacting NII
$35.6
$32.7
$37.1
$35.5
$31.5
Net Interest Income (TE)
core
(Reported NII less net PAAs)
$138.5
$139.0
$139.7
$147.3
$148.6
Average Earning Assets
$16,385
$16,500
$16,518
$16,246
$15,830
Net Interest Margin
reported
4.23%
4.17%
4.32%
4.48%
4.54%
Net Purchase Accounting Adjustments (%)
.86%
.79%
.91%
.87%
.79%
Net Interest Margin -
core
3.37%
3.38%
3.41%
3.61%
3.75%
* Excess cash recoveries include cash collected on certain zero
carrying value acquired loan pools. |
Purchase Accounting Adjustments
Purchase Accounting Adjustments
Net purchase accounting
adjustments will be part of
earnings through 2015
Revenue includes loan
accretion, securities
amortization, CD accretion
Amortization of intangibles
mainly related to the Whitney
acquisition
12
$s in millions
Impact of Purchase Accounting Adjustments 2012-2015
(2013-2015 projections will be updated quarterly; subject to
volatility) As of September 30, 2013
|
Noninterest Income Reflects Changes
Noninterest Income Reflects Changes
Related to Seasonality, Economy
Related to Seasonality, Economy
Noninterest income totaled $63.1 million, down
$0.8 million linked-quarter
Results for trust, insurance, and investment and
annuity fees reflected some seasonality in these
lines of business and the impact of changes related
to higher equity market valuations in 2Q13
Service charges on deposits totaled $20.5 million,
up $0.7 million from 2Q13
Fees from secondary mortgage operations totaled
$2.5 million, down $1.7 million linked-quarter
reflecting a lower level of loans sold in the quarter
13
As of September 30, 2013
$s in millions |
Noninterest Expense Includes One-Time
Noninterest Expense Includes One-Time
Items; Operating Expense Declines
Items; Operating Expense Declines
Noninterest expense totaled $182.2 million in 3Q13
Includes $20.9 million of one-time costs mainly related to
the expense & efficiency initiative
Noninterest expense excluding one-time costs (or
operating expense) totaled $161.3 million, down
$0.9 million from 2Q13
14
As of September 30, 2013
$s in millions
Personnel expense, the largest component of total
noninterest expense, totaled $86.9 million, a
decrease of $0.7 million linked-quarter
ORE expense totaled $2.4 million down
$0.9 million from 2Q13
Other operating expense totaled $47.2 million, up
$0.7 million from 2Q13 |
Closed 26 banking locations across the 5-state footprint on August
30, 2013
Will close 2 branches in 4Q13
Expect the previously announced sale of 7 Houston branches to close in
4Q13**
Expect the previously announced sale of 3 Alexandria (LA) branches to
close in 1Q14** 1Q14 Expense Target Mainly Achieved Through
Previously Announced Branch Closures and Sales
15
*
*
Information
regarding
branch
sales
included
in
press
release
issued
on
July
22,
2013
Region
# of
Branches
# of
Branches
Closed
# of
Branches
Sold
1. Houston
14
1
7
2. SW Louisiana
20
--
3
3. Greater Baton
Rouge
33
3
--
4. Greater New
Orleans/Houma/
Thibodaux
66
2
--
5. South
Mississippi
43
1
--
6. AL/West FL
(panhandle)
43
11
--
7. East Central
Florida
23
10
-- |
Efficiency & Process Improvement
Efficiency & Process Improvement
Initiative On Track
Initiative On Track
Committed to reducing noninterest expense in future
years by $50 million compared to annualized 1Q13
expense
50% attainment of goal by 1Q14
100% attainment of goal by 4Q14
Longer-term sustainable efficiency ratio target of
57%-59% set for 2016
Will include reviews of front and back office areas as
well as branch network and current business models
Expect to incur additional one-time costs through the
remainder of the initiative
16
$s in millions
1Q13 noninterest
expense
$160
Annualized 1Q13
noninterest expense
$640
1Q14 noninterest
expense projection
$153
4Q14 noninterest
expense projection
$147
The
efficiency
ratio
is
defined
as
noninterest
expense
as
a
percent
of
total
revenue
(TE)
before
amortization
of
purchased
intangibles,
sub
debt
redemption
costs,
securities
transactions
and
merger
expenses.
Midpoint
Long-Term
Efficiency
Ratio
Target
57%
-
59% |
Operating EPS
excluding impact
of excess cash recoveries Near Term Operating EPS Guidance
Near Term Operating EPS Guidance
Volatility related to excess cash
recoveries (included in loan
accretion totals) impacting
quarterly operating EPS results
Expect 4Q13 operating EPS
will be flat to slightly down
from 3Q13 as projections do not
include excess cash recoveries
Expect operating EPS to begin
increasing in 1Q14 as expense
and efficiency initiatives impact
results
17
4Q12
1Q13
2Q13
3Q13
Operating EPS
$0.54
$0.56
$0.55
$0.56
$0.51
$0.50
$0.53
$0.50
EPS impact of excess cash
recoveries
$0.03
$0.06
$0.02
$0.06
$0.00
$0.15
$0.30
$0.45
$0.60 |
TCE ratio 8.68%
Announced stock buyback of up to 5% of outstanding common
stock Executed an accelerated share repurchase on May 9,
2013 Total transaction amount of $115 million
Received approximately 2.8 million shares
Impacted TCE ratio by 63 bps in 2Q13
Based on current stock prices, the remaining shares of approximately
900,000 will be received no later than 2Q14
Continue
reviewing
opportunities
to
deploy
excess
capital
in
the
best
interest
of
the
Company
and
its
shareholders
Projected capital levels exceed Basel III fully implemented, required
guidelines Solid Capital Levels
Solid Capital Levels
18
As of September 30, 2013
*Stock Buyback
(ASR) initiated |
Appendix
19 |
Non-GAAP
Reconciliation
Non-GAAP
Non-GAAP
Reconciliation
Reconciliation
20
*Management believes that adjusting net income to operating income provides a useful measure
of financial performance that helps investors compare the Companys fundamental
operations over time. $s in millions
Three
Months
Ended
9/30/2013
Three
Months
Ended
6/30/2013
Three
Months
Ended
9/30/2012
Nine
Months
Ended
9/30/2013
Nine
Months
Ended
9/30/2012
Net income
$33.2
$46.9
$47.0
$128.6
$104.8
Adjustments
from
net
to
operating
income
Securities transactions gains/(losses)
-
-
.9
-
.9
One-time noninterest expense items:
Merger-related
-
-
-
-
45.8
Subdebt early redemption
-
-
5.3
-
5.3
Expense
&
efficiency
initiative
and
other
items
20.9
-
-
20.9
-
Total one-time noninterest expense items
20.9
-
5.3
20.9
51.1
Taxes on adjustment @ 35%
(7.3)
-
(1.5)
(7.3)
(17.6)
Total adjustments (net of taxes)
13.6
-
2.8
13.6
32.6
Operating income*
$46.8
$46.9
$49.8
$142.2
$137.4 |
Additional Loan Data
Additional Loan Data
Additional Loan Data
21
*Expanded definition of O&G to include additional industry
classifications as of 9/30/13. Portfolio increased $6.5MM versus
comparable June 30, 2013 total.
E&P
$420
34%
Product
Transportation
$38
3%
Wholesale/
Refinement
$117
10%
Support -
Drilling
$252
20%
Support -
Non-
Drilling
$411
33%
Oil & Gas Portfolio* 9/30/13
$s in millions
9/30/2013
6/30/2013
$ change
% change
9/30/2012
$ change
% change
Loans (EOP)
11,735
$
11,682
$
53
$
0%
11,434
$
300
$
3%
Commercial
4,625
4,653
(28)
-1%
4,236
390
9%
Construction
920
967
(46)
-5%
1,045
(124)
-12%
Real Estate
2,915
2,872
43
1%
2,907
8
0%
Residential mortgage
1,695
1,616
79
5%
1,562
134
9%
Consumer
1,579
1,573
5
0%
1,685
(107)
-6%
Covered Loans
392
$
431
$
(39)
$
-9%
556
$
(164)
$
-29%
Commercial
24
26
(2)
-8%
22
2
11%
Construction
23
26
(3)
-12%
48
(25)
-52%
Real Estate
60
72
(12)
-17%
107
(47)
-44%
Residential mortgage
224
235
(12)
-5%
272
(48)
-18%
Consumer
61
71
(10)
-14%
107
(47)
-43%
Loans excluding covered
11,343
$
11,251
$
92
$
1%
10,879
$
464
$
4%
Commercial
4,601
4,627
(26)
-1%
4,214
387
9%
Construction
897
940
(43)
-5%
997
(99)
-10%
Real Estate
2,855
2,800
55
2%
2,800
55
2%
Residential mortgage
1,472
1,381
91
7%
1,290
182
14%
Consumer
1,518
1,503
15
1%
1,578
(60)
-4% |
Third Quarter 2013
Financial Results
October
24, 2013
Third Quarter 2013
Financial Results
October
24, 2013 |
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