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HANCOCK WHITNEY CORP (HWC)·Q3 2025 Earnings Summary

Executive Summary

  • EPS of $1.49 beat Wall Street consensus of $1.43*, driven by higher fee income and stable NIM; revenue was below consensus on S&P methodology, while company-reported GAAP revenue rose to $385.7M* .
  • NIM (TE) held at 3.49% and efficiency improved to 54.10%; ROA was 1.46% and ROTCE 15.00%, reflecting operating discipline .
  • Capital strengthened: CET1 14.08%, TCE 10.01%; the company repurchased 662,500 shares at ~$60.45, and signaled similar buyback dollars in Q4 .
  • Guidance largely maintained; Adjusted PPNR growth trimmed to 5–6% (from 6–7% previously), with modest NIM expansion expected in Q4 and NII up 3–4% for FY25 .

What Went Well and What Went Wrong

  • What Went Well
    • Fee income strength: noninterest income rose $7.5M QoQ (+8%), with record investment/annuity and higher trust fees (Sabal Trust contribution) . CEO: “another quarter of exceptionally strong performance… continued improvement in profitability” .
    • Margin and efficiency stability: NIM (TE) 3.49% flat QoQ; efficiency ratio improved 81 bps to 54.10% . CFO: “our efficiency ratio continued to improve… 54.1% this quarter” .
    • Credit moderation: criticized commercial loans decreased to $549M; net charge-offs fell to 0.19% of average loans . CCO: seeing “return to moderation in criticized loans” as resolutions outpace inflows .
  • What Went Wrong
    • Revenue vs consensus: S&P “actual” revenue printed below consensus*, creating a headline miss despite company-reported GAAP revenue growth .
    • Deposits declined $387M LQA; DDA fell $334M due to seasonality and outflows, partly offset by interest-bearing growth .
    • Nonaccrual loans increased to $113.6M (0.48% of loans); line utilization fell ~90 bps on early project completions and larger-than-normal client M&A/payoffs .

Financial Results

MetricQ3 2024Q2 2025Q3 2025
Total GAAP Revenue ($USD Millions)$367.659 $375.483 $385.739
Diluted EPS ($USD)$1.33 $1.32 $1.49
Net Interest Margin (TE, %)3.39% 3.49% 3.49%
Efficiency Ratio (%)54.42% 54.91% 54.10%
ROA (%)1.32% 1.32% 1.46%
ROE (%)11.43% 10.63% 11.58%
Net Charge-offs / Avg Loans (%)0.30% 0.31% 0.19%

Noninterest Income Breakdown ($USD Millions)

CategoryQ3 2024Q2 2025Q3 2025
Service charges on deposit accounts$23.144 $24.256 $25.220
Bank card and ATM fees$21.639 $22.004 $21.814
Investment & annuity fees and insurance commissions$10.890 $10.603 $14.507
Trust fees$18.014 $22.753 $24.211
Secondary mortgage market operations$3.379 $4.147 $3.475
Other income$18.829 $14.761 $16.774
Total Noninterest Income$95.895 $98.524 $106.001

Balance Sheet & Capital KPIs

MetricQ3 2024Q2 2025Q3 2025
Loans (EOP, $USD Millions)$23,455.587 $23,461.750 $23,596.565
Total Deposits (EOP, $USD Millions)$28,982.905 $29,046.612 $28,659.750
Noninterest-bearing Deposits (EOP, $USD Millions)$10,499.476 $10,638.785 $10,305.303
ACL as % of Loans1.46% 1.45% 1.45%
CET1 Ratio (%)13.78% 13.97% 14.08%
TCE Ratio (%)9.56% 9.84% 10.01%

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Adjusted PPNR growth YoYFY 20256–7% 5–6% Lowered
NII (TE) growth YoYFY 20253–4% 3–4% Maintained
NIM (TE)Q4 2025Modest expansion Modest expansion Maintained
Loans (EOP) vs 12/31/24FY 2025Up low single digits Up low single digits Maintained
Deposits (EOP) vs 12/31/24FY 2025Up low single digits Up low single digits Maintained
Noninterest Income growth YoYFY 20259–10% 9–10% Maintained
Adjusted Noninterest Expense growth YoYFY 20254–5% 4–5% Maintained
Net Charge-offs / Avg LoansFY 20250.15–0.25% 0.15–0.25% Maintained
Effective Tax RateFY 2025~20–21% ~20–21% Maintained
Efficiency Ratio*FY 202554–56% 54–56% Maintained

Earnings Call Themes & Trends

TopicPrevious Mentions (Q1 2025)Previous Mentions (Q2 2025)Current Period (Q3 2025)Trend
Loan growth & payoffsLoans down $201M on large payoffs; back-half growth expected Loans +$364M (6% LQA); SNC ~9.5% Loans +$135M (2% LQA); SNC 8.9%; heavy paydowns; plan to hire more bankers Mixed; production strong, paydowns offset
Deposit costs & betasCost of deposits down 15 bps; promo rate reductions Cost down to 1.65%; cumulative betas target 37–38% total, 57–58% IB Cost down 1 bp to 1.64%; spot 1.63%; proactive repricing Improving modestly
Capital & buybacksRepurchased 350k; CET1 14.51% Repurchased 750k; CET1 14.03% Repurchased 662.5k; expect ~$40M repurchases; CET1 14.08% Strong capital; steady buybacks
Fee income growthRaised FY25 fee guide to 9–10% Fees +$4M; trust +$4.7M incl. $3.6M Sabal Fees +$7.5M; record investment/annuity; trust +$1.5M Positive momentum
Market expansion (Dallas)5 planned locations; begin late 2025 Locations advancing 5 identified; open late 4Q25/2026; more staffing Executing expansion
Asset qualityACL 1.49%; NCO 0.18%; nonaccrual up slightly Criticized down to $569M; NCO 0.31% Criticized down to $549M; NCO 0.19%; nonaccrual $114M Stable-to-improving criticized; mixed nonaccruals

Management Commentary

  • Strategy and performance: “We saw continued improvement in profitability… ROA was a remarkable 1.46%… efficiency ratio improved to 54.10%, and our NIM was stable at 3.49%” — John M. Hairston, CEO .
  • Capital deployment: “Earnings contributed to growth in all of our capital ratios, while we continued to deploy capital through… repurchasing 662,500 shares” .
  • Organic growth plan: “We remain committed to executing on our organic growth plan… repurchasing… and opening five new locations in the Dallas market” .
  • Cost control: “Expenses remained well controlled… efficiency ratio reached 54.1%” — CFO .
  • M&A stance: “Our stance on M&A hasn’t changed… we’re not really focused on that right now at all” — CFO .

Q&A Highlights

  • Loan growth vs paydowns: Management detailed strong production (up 6% QoQ, +46% YoY) but heavier paydowns (industrial projects finishing early; client sales to larger firms) and intends to add more bankers to offset persistent paydowns .
  • Capital return: Expect repurchases at roughly the same dollar level (~$40M) in Q4; potential dividend discussion in January; CET1 operating comfort 11–11.5% longer term, but no active program to reduce capital to that range .
  • Deposit pricing and competition: Proactive rate cuts on CDs/MM; spot cost of deposits 1.63% in Sept; competitive landscape “better behaved” than prior cycles; expecting seasonal public fund inflows in Q4 .
  • Margin outlook: Modest NIM expansion expected in Q4; loan yields to drift down with rate cuts; deposit costs to decline with repricing .

Estimates Context

Consensus vs Actual (S&P Global)

MetricQ3 2025 ConsensusQ3 2025 Actual
EPS ($)1.4328*1.49
Revenue ($USD Millions)391.238*372.020*

Estimate Track Record

MetricQ3 2024 ConsensusQ3 2024 ActualQ1 2025 ConsensusQ1 2025 ActualQ2 2025 ConsensusQ2 2025 Actual
EPS ($)1.2983*1.33 1.2891*1.38 1.3612*1.32
Revenue ($USD Millions)367.154*347.510*367.962*353.166*376.195*359.490*

Note: Values marked with * retrieved from S&P Global. Company-reported total GAAP revenue in Q3 2025 was $385.739M, which differs from S&P’s “actual” revenue basis used above .

Key Takeaways for Investors

  • EPS beat (1.49 vs 1.43*) with stable NIM and improved efficiency underscores resilient earnings power amid falling rates .
  • Fee engines (trust, investment/annuity) are driving top-line diversification; Sabal Trust integration adds incremental trust revenue .
  • Credit metrics remain manageable: criticized loans down, NCOs lower; nonaccruals ticked up but coverage (ACL 1.45%) steady .
  • Capital robust (CET1 14.08%, TCE 10.01%); continued buybacks (~$40M target in Q4 discussed) provide shareholder return and support per-share metrics .
  • Guidance intact except PPNR trimmed to 5–6% from 6–7%; modest NIM expansion expected in Q4, with FY25 NII up 3–4% .
  • Near-term trading catalysts: seasonal Q4 deposit inflows, CD repricing lower, and fee seasonality (transaction-related fees lighten into holidays per management) .
  • Medium-term thesis: multi-year organic growth plan (Dallas expansion, banker hiring) aims to offset persistent paydowns and sustain loan growth, while fee franchises and disciplined cost management support profitability .

Additional items: The Board declared a regular Q4 2025 dividend of $0.45 per share (payable Dec 15, 2025; record Dec 5, 2025) .