DEF: Hancock Whitney Reports Strong 2024 Financial Results, Increases Shareholder Dividends

Hancock Whitney celebrated its 125th anniversary with improved profitability, strong capital ratios, and increased dividends in 2024.

Summary

• Hancock Whitney Corporation reported improved financial results for 2024, marking its 125th anniversary.
• Net income per diluted share increased to $5.28, compared to $4.50 in 2023.
• Adjusted pre-provision net revenue totaled $641.0 million in 2024, up from $635.7 million in 2023.
• Fee income increased by 8% in 2024, adjusted for supplemental disclosure items.
• Expenses, adjusted for supplemental disclosure items, rose less than 1% in 2024.
• The net interest margin was 3.37% for 2024, a 3 bps increase from 2023.
• The company focused on originating more granular, full-service-relationship loans and reducing exposure to higher balance, loan-only relationships.
• The non-interest bearing deposit mix was 36% at year-end 2024, compared to 37% at year-end 2023.
• Criticized loan levels normalized in 2024, with a robust allowance for credit losses reserve coverage of 1.47%.
• The tangible common equity ratio was 9.47% and the common equity tier 1 ratio was 14.14% at year-end 2024, compared to 8.37% and 12.33% respectively at year-end 2023.
• The total risk-based capital ratio was 15.93% at year-end 2024, compared to 13.93% at year-end 2023.
• The Board of Directors approved a 33% increase in the quarterly dividend payment in April 2024, bringing total dividends payable to $0.40 per common share.
• In January 2025, the Board approved a further dividend increase to $0.45 per common share.
• The company's stock price ended 2024 at $54.72, up from $48.59 at December 31, 2023, achieving a record high closing price of $61.04 on November 25, 2024.
• Moses H. Feagin Sr. was appointed to the Board of Directors in 2024, and Albert J. Williams is a new director nominee.
• Hardy B. Fowler will not be standing for re-election after 15 years of service.

Sentiment

Score: 8

Explanation: The document presents a positive outlook with strong financial results, increased dividends, and a rising stock price. The company's management expresses confidence in its future performance.

Positives

• Improved profitability with increased net income per diluted share.
• Strong capital ratios, including tangible common equity and common equity tier 1.
• Increased dividend payments to shareholders.
• Rising stock price and achievement of a record high closing price.
• Stable and diverse deposit base.
• Normalization of criticized loan levels.
• Robust allowance for credit losses reserve coverage.
• Strategic reduction of shared national credit portfolio.

Negatives

• Total assets decreased by 1% compared to December 31, 2023.
• Deposits decreased by 1% from December 31, 2023.
• Loans decreased by $622.5 million.

Risks

• The document mentions a changing interest rate environment, which could impact future profitability.
• The company acknowledges that credit metrics normalized compared to the earlier post-pandemic environment, which could indicate potential future credit losses.
• The company notes a decline in brokered deposits, which could impact funding costs.

Future Outlook

The company believes it is well-positioned to continue creating value for shareholders due to its de-risked balance sheet, strong capital, solid deposit base, improved profitability, and solid allowance for credit losses.

Management Comments

• We believe we are well-positioned to help build a brighter future for our shareholders, clients, associates, and communities we serve for many years to come.
• With our de-risked balance sheet, remarkably strong capital, solid deposit base, improved profitability, and solid allowance for credit losses, we believe we are well-positioned to continue to create value for you, our shareholders, for years to come.

Industry Context

The announcement reflects a trend among regional banks to focus on profitability, capital strength, and shareholder returns in a changing interest rate environment. The company's emphasis on granular loans and deposit stability aligns with industry best practices.

Comparison to Industry Standards

• The document mentions a Compensation Peer Group of 26 banks and bank holding companies with assets ranging from $24 billion to $100 billion.
• Comparable companies in the peer group include Ameris Bancorp, Associated Banc-Corp, BankUnited Inc., and BOK Financial Corp.
• The company's goal is to align executive compensation with the median of this peer group.
• The company's capital ratios are strong and well above regulatory minimums, which is a key benchmark for financial institutions.

Management Changes

Stakeholder Impact

• Shareholders will benefit from increased dividends and potential stock price appreciation.
• Clients will benefit from the company's focus on full-service-relationship loans.
• Associates will benefit from the company's commitment to retaining qualified employees through incentive programs.
• Communities will benefit from the company's commitment to building a brighter future.

Next Steps

• Shareholders will vote on the election of directors, executive compensation, an amendment to the long term incentive plan, and the ratification of the independent registered public accounting firm at the Annual Meeting on April 23, 2025.

Key Dates