Hancock Whitney Corporation (NASDAQ:HWC) Q4 2019 Earnings Conference Call - Final Transcript

Jan 16, 2020 • 09:30 am ET

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Hancock Whitney Corporation (NASDAQ:HWC) Q4 2019 Earnings Conference Call - Final Transcript

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Presentation
Executive
John M. Hairston

restarted acquisitions. We completed five transactions in the past five years that were financial in nature, an accretive immediately to earnings.

Along with a deliberate remix in lending growth, the transactions helped to grow the company to over $30 billion assets and have strengthened our position in existing markets and facilitated entry to new ones. Through it all, our capital has remained strong and we have managed it, we believe, in the best interest of our shareholders through organic growth, increasing dividends, stock repurchases and profitable mergers and acquisitions.

Slide 7 addresses focus areas for 2019. With profitability back to peer levels and holding despite a falling rate environment, we worked vigorously to bring our margin and credit metrics back to or better than peer averages. We have made progress on both actually moving above average on one. The top right chart on Slide 7 shows our NIM. In the first quarter of 2019, we achieved peer levels. Then for the past three quarters, we have actually reported a better than peer average margin.

While we can check the box on this one, we will not lose sight on what it takes to keep it there. The other two metrics are related to asset quality. We have made meaningful progress on both, but still have work to do, especially on non-performing loans and TDRs. The gap to peers on criticized loans has diminished from 375 basis points in the first quarter of 2018 to only 44 basis points today, while the gap on NPLs is narrowed from 145 basis points to 72 basis points.

Turning now to the future. As we do each January, we have updated our Corporate Strategic Objectives or CSOs found on Slide 22. Our CSOs are based on the results of our annual budget and multi-year business plan. That has not changed. With achievement of profitability metrics, we opted to take a more conventional approach to discussing longer-term goals. Instead of specifying a particular target quarter two years out, we are sharing our expectations for a three-year annualized outlook represented by the business plan.

If interest rates change for the better or we find an acquisition like previous ones, we expect to accomplish the goals early. If the environment changes and presents more challenges, it could take us longer to achieve. Our CSOs are meant to convey where we believe the company is headed based on our focus and outlook today, all designed to enhance shareholder value. In recent months, we fielded questions about the company's technology readiness and scalability.

Slide 23 in the investor deck provides a short description of where we are in multi-year technology investments. The company is both competitive and scalable already with additional improvements, specifically in sales technology deploying over the next several quarters.

With that, I will turn the call over to Mike for a few additional comments and details.

Executive
Michael M. Achary

Thanks, John. Good morning, everyone. EPS for the quarter was $1.03 and included nearly $4 million or $0.03 per share