Hancock Whitney's Q3 2025: Contradictions in Loan Growth, Deposit Costs, and M&A Strategy

The above is the analysis of the conflicting points in this earnings call

Business Commentary:

* Loan Growth and Paydown Dynamics: - Hancock Whitney's loan growth was 2% annualized, with production increasing 6% quarter-over-quarter and 46% year-over-year. However, payoffs, including those from SNCs and industrial contractors, reduced the net growth. - This was driven by higher payoffs of larger credits and unexpected project completions that led to early payments, despite strong production levels.

• Strong Fee Income and Expense Control:
• Fee income grew to $106 million, an increase of 8% from the previous quarter, marking a record high for the organization.

• Expenses were well-controlled, with an increase of less than $3 million or 1% from the previous quarter, predominantly due to investments in revenue producers and higher incentive income.

• Profitability and Capital Ratios:

• The company reported an ROA of 1.46%, up from 1.32% in the prior year, driven by reduced efficiency ratios and progress on the organic growth plan.

• Earnings contributed to growth in capital ratios, with TCE ending at 10.01% and the common equity Tier 1 ratio at 14.08%.

• Deposit Trends and Reinvestment:

• Deposits were down $387 million, primarily driven by seasonal activities in public fund DDA and interest-bearing accounts.
• The company continued to reprice lower rates on CDs and public fund deposits, anticipating further declines in deposit costs with expected rate cuts.