Hancock Whitney (HWC) Q2 2024 earnings summary

Executive summary

• Net income for Q2 2024 was $114.6 million ($1.31 per diluted share), up from $108.6 million in Q1 2024, with profitability driven by NIM expansion, fee income growth, and expense control.

• Adjusted pre-provision net revenue reached $156.4 million, a 2% increase sequentially.

• Strategic balance sheet repositioning continued, focusing on reducing large credit-only relationships and growing more granular, full-service relationships.

• No supplemental disclosure items impacted Q2 2024 results; Q1 2024 included a $3.8 million FDIC special assessment.

• Capital return to investors included a 33% dividend increase and resumption of share repurchases, with 312,993 shares repurchased.

Financial highlights

• Net interest income (taxable equivalent) for Q2 2024 was $273.3 million, up $4.3 million from Q1 2024; NIM expanded to 3.37%, up 5 bps sequentially.

• Noninterest income rose to $89.2 million, up 2% sequentially, with growth in trust, card, and ATM fees.

• Noninterest expense decreased to $206.0 million, down $1.7 million sequentially, reflecting lower personnel costs.

• Efficiency ratio improved to 56.18%, down 26 bps from Q1 2024.

• Allowance for credit losses was $342.2 million, or 1.43% of loans.

Outlook and guidance

• Loans and deposits are expected to be flat to slightly down from 2023, reflecting a shift to more granular, higher-yielding relationships.

• Modest NIM expansion is anticipated for the next two quarters, assuming no Fed rate cuts.

• Noninterest income for 2024 is projected to rise 4%-5% from 2023's adjusted level; expenses are forecasted to grow 2%-3%.

• PPNR for 2024 is guided to be down 1%-2% from 2023's adjusted levels, with modest growth in the second half.

• Effective tax rate for 2024 is forecasted at 20%-21%.