Yahoo Finance Hancock Whitney Corp (HWC) Q1 2024 Earnings Call Transcript Highlights: Strategic Insights and ...
Net Income: Reported at $109 million, or $1.24 per share; adjusted net income was $112 million, or $1.28 per share after excluding a special FDIC assessment.
Revenue: Adjusted PPNR was $153 million, slightly down by $3 million from the previous quarter.
Net Interest Margin (NIM): Expanded by five basis points to 3.32%.
Loan Growth: Described as modest, with a focus on granular, full relationship loans.
Deposit Growth: Increased by $86 million, including the maturity of $195 million in brokered deposits.
Capital Ratios: Continued improvement noted, with TCE growing to 8.62% and common equity Tier 1 ratio at 12.67%.
Credit Quality: Metrics normalized with modest net charge-offs; loan portfolio remains diverse without significant weakening in any sector.
Fee Income: Remained flat, supported by strong investment and annuity income activities.
Expenses: Also flat, reflecting controlled cost management.
Release Date: April 16, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Q & A Highlights
Q: Can you provide more details on the increase in nonperformers and criticized assets? A: (Matthew Olney, Analyst) - The increase in criticized loans and nonperformers is mostly due to a few medium-sized credits facing temporary challenges, likely from higher operating costs and reduced liquidity in the current economic environment. However, these are expected to resolve over time.
Q: How are you adjusting your strategy regarding shared national credits and large loan-only relationships? A: (John Hairston, President & CEO) - The bank is focusing on reducing its reliance on non-relationship large credits and shifting towards more granular, full relationship loans. The shared national credit portfolio, currently at 11% of loans, is expected to decrease to align more closely with peer levels over the next few years.
Q: What are your expectations for loan growth given the economic slowdown signs? A: (John Hairston, President & CEO) - Hancock Whitney anticipates loan growth acceleration in the latter half of the year, driven by improved line utilization and a potential moderation in interest rates, which could spur businesses to act on pent-up demand.
Q: Can you discuss the impact of CD repricing on your net interest margin (NIM)? A: (Mike Achary, CFO) - CD repricing is expected to be a significant factor in NIM performance, particularly if interest rates are cut as anticipated. The bank has strategically set CD rates to align maturities with potentially lower future rates, aiding margin improvement.
Q: What are your plans regarding capital management, particularly dividends and buybacks? A: (Mike Achary, CFO) - The bank's strong capital ratios may lead to considerations of increasing dividends and resuming buybacks within the next quarter, reflecting confidence in capital management and shareholder value enhancement.
Q: How is the bank handling the current rate environment in terms of deposit and loan pricing? A: (John Hairston, President & CEO) - Hancock Whitney is maintaining competitive deposit rates to manage liquidity effectively while focusing on achieving favorable loan pricing, despite market pressures from anticipated rate cuts.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
