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HANCOCK WHITNEY CORP (HWC)·Q4 2024 Earnings Summary

Executive Summary

  • Q4 2024 delivered solid profitability and operating discipline: diluted EPS $1.40, ROA 1.40%, NIM (TE) 3.41%, and efficiency ratio 54.46% as deposit costs fell and capital ratios climbed (CET1 14.14%) .
  • Non-GAAP items did not affect Q4; the prior-year Q4 2023 included $75.4M of supplemental items—adjusted EPS would have been $1.26—so year-over-year optics overstate growth versus “clean” comps .
  • Balance sheet trends were mixed: loans contracted on CRE payoffs while deposits rose seasonally; asset quality normalized with higher criticized and nonaccruals but modest NCOs; reserve coverage edged up to 1.47% .
  • 2025 guidance (ex-Sabal) points to mid-single-digit loan growth, low-single-digit deposit growth, NII (TE) up 3.5–4.5%, modest NIM expansion, and PPNR up 3–4%; buybacks expected to revert to ~300k shares/quarter; dividend raised to $0.45 in Jan-25 .
  • Catalysts: Sabal Trust acquisition (immediate EPS accretion, strengthens Florida wealth), multi-year banker hiring and Dallas expansion, deposit repricing tailwinds, and continued capital return .

What Went Well and What Went Wrong

  • What Went Well

    • “We achieved an ROA of a notable 1.40%. We enjoy continued NIM expansion… efficiency ratio of 54.46%” (CEO) .
    • Cost of funds fell 21 bps (to 1.73%); cost of deposits down 17 bps (to 1.85%) as CDs repriced and brokered deposits matured (CFO) .
    • Capital strengthened: CET1 14.14% (+36 bps LQ), total risk-based ~15.93%, supporting ongoing buybacks and organic growth investments .

  • What Went Wrong

    • Loans declined $156M LQ on elevated CRE payoffs despite strong production; loan yields fell 25 bps as variable-rate loans reset lower .
    • Criticized commercial loans and nonaccruals rose (criticized to $623M; nonaccruals to 0.42% of loans), reflecting normalization and borrower pressures in select sectors .
    • Fee income down 5% LQ on lower specialty/derivative/SBA income and softer secondary mortgage activity; PPNR slipped slightly LQ .

Financial Results

MetricQ2 2024Q3 2024Q4 2024
Diluted EPS ($)$1.31 $1.33 $1.40
Total Revenue (TE) ($USD Millions)$362.4 $370.4 $367.5
Net Interest Income (TE) ($USD Millions)$273.3 $274.5 $276.3
Noninterest Income ($USD Millions)$89.2 $95.9 $91.2
Adjusted PPNR (TE) ($USD Millions)$156.4 $166.5 $165.2
NIM (TE) (%)3.37% 3.39% 3.41%
Efficiency Ratio (%)56.18% 54.42% 54.46%
ROA (%)1.32% 1.32% 1.40%

Segment breakdown (Loan portfolio, Q4 2024):

SegmentOutstanding ($USD Millions)% of Total Loans
Commercial non-RE (C&I)$7,665 32.9%
CRE – Owner$2,444 10.5%
Income-producing CRE (ICRE)$3,296 14.1%
Construction & Land Dev.$1,210 5.2%
Healthcare (incl. C&I/CRE)$2,020 8.7%
Equipment Finance$1,135 4.9%
Energy$198 0.8%
Residential Mortgage$3,961 17.0%
Consumer$1,370 5.9%
Total$23,299 100.0%

Key KPIs

KPIQ2 2024Q3 2024Q4 2024
Loans (Period-End, $USD Millions)$23,911.6 $23,455.6 $23,299.4
Deposits (Period-End, $USD Millions)$29,200.7 $28,982.9 $29,492.9
DDA Mix (% of Deposits)36% 36% 36%
CET1 Ratio (%)13.25% 13.79% 14.14%
TCE Ratio (%)8.77% 9.56% 9.47%
ACL / Loans (%)1.43% 1.46% 1.47%
Nonaccrual Loans / Loans (%)0.36% 0.35% 0.42%
Net Charge-offs to Avg Loans (Annualized, %)0.12% 0.30% 0.20%

Why the changes:

  • NIM expansion: lower deposit rates (+16 bps), better funding mix (+5 bps), and higher securities yield (+1 bp) offset lower loan yields (-20 bps) .
  • Loans fell on elevated CRE payoffs; deposits rose on seasonal inflows in public funds and higher IB transaction/savings balances with some retail time deposit runoff .
  • Criticized and nonaccrual loans normalized upward while net charge-offs remained modest; ACL coverage ticked up .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Loans (EOP)FY 2025Not previously quantifiedUp mid-single digits vs 12/31/24 New
Deposits (EOP)FY 2025Not previously quantifiedUp low single digits vs 12/31/24 New
NII (TE)FY 2025Not previously quantifiedUp 3.5%–4.5% YoY; modest consistent NIM expansion New
Adjusted PPNRFY 2025Not previously quantifiedUp 3%–4% YoY New
Noninterest IncomeFY 2025Not previously quantifiedUp 3.5%–4.5% YoY New
Adjusted Noninterest ExpenseFY 2025Not previously quantifiedUp 4%–5% YoY (incl. organic growth; excl. Sabal) New
Efficiency RatioFY 2025Not previously quantifiedMaintain 55%–56% New
Effective Tax RateFY 2025Not previously quantified~20%–21% New
Charge-offs/ProvisionFY 2025Qualitative only“Modest” charge-offs; provision modest (CFO clarified upper-teens to low-20s bps) Reiterated/clarified
Share Buybacks2025 run-rate~300k shares/qtr in 2H24 Revert to ~300k/qtr (Q4 lower due to blackout) Maintained
Dividend1Q25$0.40 in Q4 2024 Raised to $0.45 (+12.5%) Raised

Earnings Call Themes & Trends

TopicQ2 2024 (Prior-2)Q3 2024 (Prior-1)Q4 2024 (Current)Trend
Deposit pricing & betas/CD repricingCost of deposits turned lower; CDs repricing down; total deposit betas framework discussed Expect lower deposits cost; $2.6B CDs repriced; total betas expectations shared Cost of deposits -17 bps; $2.5B Q1 CDs maturing; renew rates stepping down Improving deposit costs tailwind
Loan growth strategy/SNC runoffPurposeful SNC reduction; 2024 loans flat-to-down SNC at peer levels; pipeline building; pivot to growth in 2025 Guide mid-single-digit loan growth 2025; drivers across segments Pivot to growth (2H bias)
Wealth management/strategic expansionFee lines strong; investing in advisers Open to M&A; focus TX/FL; organic hiring Acquiring Sabal Trust; Florida largest WM fee state; immediate EPS accretion Expanding WM via M&A + hiring
Asset quality normalizationCriticized up modestly; diverse; no broad weakness Criticized up (SNC exam impact), nonaccrual down Criticized/nonaccrual up; modest NCOs; reserve stable Normalization with slight upward pressure
Capital & buybacksDividend increased; buybacks resumed (313k) Buybacks ~300k; capital ratios up 150k repurchased (blackout); plan ~300k/qtr; CET1 14.14% Consistent capital return; rising CET1
NIM trajectory+5 bps to 3.37% +2 bps to 3.39% +2 bps to 3.41%; 2025 modest expansion Gradual expansion

Management Commentary

  • CEO: “We achieved an ROA of a notable 1.40%. We enjoy continued NIM expansion and ramped the quarter with total risk-based capital of nearly 16%.”
  • CEO: “We announced this morning our acquisition of Sabal Trust Company… Florida will become our largest wealth management fee stake… Tampa/St Pete MSA will become our largest individual wealth management fee market.”
  • CFO: “Our overall cost of funds was down 21 basis points to 1.73%… cost of deposits down 17 basis points to 1.85%… CDs will continue to reprice lower throughout 2025… We believe we can achieve modest NIM expansion and NII growth of between 3.5% and 4.5% in 2025.”
  • CCO: Criticized migration spanned consumer discretionary, building products/services, hotels, healthcare; largely transitory/situational; portfolio remains diversified and peer-comparable .

Q&A Highlights

  • Buybacks cadence: Expect to revert to ~300k shares per quarter in 2025 after Q4 blackout; more aggressive repurchases possible depending on valuation and balance sheet growth (CFO) .
  • Loan growth drivers: Confidence tied to end of SNC runoff, pipelines across small business, commercial banking, healthcare, CRE later in year; competition (nonbank) may pressure new money yields (CEO) .
  • CD repricing specifics: ~$2.5B maturing in Q1 (coming off ~4.34%, going on ~3.74%), ~$8B total in 2025 (off ~3.79%, on ~3.10%), renewal rates stepping down (CFO) .
  • Asset quality outlook: “Modest” charge-offs defined as upper teens to low-20s bps of average loans; CRE losses historically limited; expect in-line with peers (CFO/CEO) .
  • Hiring impact: ~35 net new bankers over 5 quarters; majority of P&L impact in 2026; 2025 carries expense ahead of full revenue flywheel (CEO) .

Estimates Context

  • Wall Street consensus estimates via S&P Global were unavailable at time of analysis due to SPGI request limits; therefore, estimate comparisons (EPS, revenue) are not shown. If needed, we will update when access is restored.

Key Takeaways for Investors

  • Deposit cost relief is a clear 2025 tailwind: sizable CD maturities are repricing lower, DDA mix stable at 36%, and brokered deposits rolled off—supporting modest NIM expansion even with lower variable loan yields .
  • Loan growth should re-accelerate (mid-single digits) with SNC headwind removed, multi-segment pipelines (SMB, commercial banking, healthcare, CRE 2H), and banker hiring; expect growth skewed to 2H25 .
  • Capital remains a strategic lever: CET1 14.14% and strong profitability support continued buybacks (~300k/qtr) and dividend growth ($0.45 in 1Q25), alongside organic expansion and Sabal integration .
  • Asset quality normalization warrants monitoring: criticized and nonaccruals are higher, but reserves (ACL 1.47%) and guidance for “modest” charge-offs suggest contained credit costs; peer-relative nonaccruals remain favorable historically .
  • Wealth management is becoming a larger earnings contributor: Sabal adds immediate EPS accretion, deepens Florida presence, and bolsters fee income diversification—supportive for valuation re-rate potential over time .
  • Near-term trading setup: Focus on deposit cost trajectory, NIM prints, and any update to Sabal close/timing; watch CRE payoff pace and criticized migration for sentiment impacts; any acceleration in hiring or M&A commentary could catalyze expectations .

All information above is sourced from HWC’s Q4 2024 press release and 8-K (including slides) and the earnings call transcript: and Q3/Q2 materials , plus Sabal/dividend releases .