GUFPORT: Hancock Whitney Corp (HWC.O) on Tuesday reported a 12% rise in third-quarter profit, driven by higher noninterest income and improved operational efficiency, even as deposits dipped.
The Gulf Coast-based lender posted net income of $127.5 million, or $1.49 per share, for the quarter ended Sept. 30, up from $113.5 million, or $1.32 per share, in the second quarter.
The results underscore the bank’s ability to grow profitability in a falling interest rate environment, with its key net interest margin holding steady.
“Despite a falling rate environment, our earnings performance contributed to growth in all of our capital ratios,” Chief Executive Officer John M. Hairston said in a statement.
Financial Performance
The bank’s adjusted pre-provision net revenue, a key measure of profitability, rose 5% to $175.6 million from the prior quarter.
Net interest income was largely stable, increasing 1% to $282.3 million, while the net interest margin held firm at 3.49%. Noninterest income saw a significant 8% jump to $106.0 million, fueled by higher investment and annuity fees, as well as increased syndication fees.
Meanwhile, noninterest expense fell 1% to $212.8 million, improving the bank’s efficiency ratio to 54.10%. The prior quarter’s expenses had been inflated by one-time costs related to the acquisition of Sabal Trust Company.
Loans, Deposits, and Asset Quality
The bank’s loan book grew modestly, with total loans increasing by $134.8 million to $23.6 billion.
Deposits, however, decreased by $386.9 million to $28.7 billion, which the company attributed to seasonal outflows and a reduction in public fund balances.
Asset quality showed a mixed picture. While criticized commercial loans continued to moderate, nonaccrual loans rose to $113.6 million, or 0.48% of total loans, up from 0.40% in the second quarter. The bank’s allowance for credit losses remained solid at 1.45% of total loans.
Capital and Returns
Hancock Whitney continued to build capital, with its estimated Common Equity Tier 1 (CET1) ratio rising to 14.08%. The company also returned capital to shareholders, repurchasing 662,500 shares of its common stock during the quarter.
Looking ahead, management said it expects “low-single digit” loan growth for the remainder of the year and for period-end deposits to be up slightly from year-end 2024 levels.