Third Quarter 2021 Earnings Conference Call 10/19/2021 Important cautionary statement about forward-looking statements This presentation contains forward-looking statements within the meaning of section 27A of the Securities Act of 1933, as amended, and section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements that we may make include statements regarding our expectations of our performance and financial condition, balance sheet and revenue growth, the provision for credit l ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark one) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2021 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number: 001-36872 HANCOCK WHITNEY CORPORATION (Exact name of registrant as specified in its charter) Mississippi 64-0693170 (State or o ...

Financial Data and Key Metrics Changes - The company reported net income of $130 million or $1.46 per share, an increase of $41 million or $0.46 linked quarter [8] - Adjusted EPS for the third quarter was $1.45, up $0.08 linked quarter [8] - A negative provision of $27 million in the third quarter compared to a negative provision of $17 million in the second quarter, attributed to less than $2 million of net charge-offs [9] - Criticized and non-performing loans decreased by 29% and 65% respectively from one year ago [9] Business Line Data and Key Metrics Changes - Core EOP loans grew by $220 million, partially offsetting $482 million in PPP forgiveness during the quarter [17] - Total reported loans decreased by $262 million, ending the quarter at just under $21 billion [17] - The company maintained guidance for core loan growth of $400 million to $500 million and PPP forgiveness of up to $500 million [18] Market Data and Key Metrics Changes - The company experienced a flat net interest income with only a 2 basis points compression in NIM [19] - The NIM was impacted by a full quarter's effect from the June redemption of subordinated debt and a lower cost of deposits, adding 5 basis points to the NIM [20] - The company expects an additional 4 basis points of compression in the fourth quarter due to continued levels of liquidity and lower rates [21] Company Strategy and Development Direction - The company aims for a 55% efficiency ratio and plans to deploy excess liquidity into loans and securities as rates rise [12] - The company is hiring bankers in new and growth markets, having added 15 new bankers recently [13] - The company is focused on strategic procurement and operational effectiveness gains through technology deployment [14] Management's Comments on Operating Environment and Future Outlook - Management noted that there is no significant pressure on credit from Hurricane Ida or the Delta surge, with asset quality metrics improving [10] - The company expects to maintain a strong position with TCE projected back to 8% or better by year-end [14] - Management expressed confidence in achieving solid loan growth and maintaining expense targets despite inflationary pressures [12][23] Other Important Information - The company repurchased just over 56,000 shares of common stock at an average price of $44.49 per share [24] - The company expects mortgage fees to slow as the boom in refinancing begins to subside [22] Q&A Session Summary Question: Efficiency ratio target and revenue expectations - Management directed attention to slide eighteen for guidance on loan growth and balance sheet management [32] Question: Credit quality and reserve levels - Management indicated potential for reserve releases similar to previous quarters, estimating around $27 million to $28 million [38] Question: Fee income guidance and mortgage impact - Management noted that secondary mortgage fee reduction was a significant detractor from fee income, but other categories showed improvement [44] Question: Margin pressure and loan pricing - Management acknowledged competitive pricing pressures in the market but indicated they are meeting competition effectively [76] Question: Investment securities portfolio growth - The bond book is currently at about $8.2 billion, representing approximately 25.6% of earning assets, with potential growth depending on market conditions [80]

Financial Performance - Net income for the three months ended June 30, 2021, was $88,718 thousand, a recovery from a net loss of $(117,072) thousand in the same period of 2020[16]. - Earnings per share for the three months ended June 30, 2021, was $1.00, compared to a loss per share of $(1.36) for the same period in 2020[16]. - Comprehensive income for the three months ended June 30, 2021, was $163,023 thousand, compared to a loss of $(87,612) thousand in the same period of 2020, indicating a strong recovery[18]. - Net income for the three months ended June 30, 2021, was $195,890, compared to a net loss of $228,105 for the same period in 2020, representing a significant turnaround[23]. - Net income for Q2 2021 was $88.7 million, or $1.00 per diluted share, down from $107.2 million, or $1.21 per share in Q1 2021[187]. Asset and Deposit Growth - Total assets increased to $35,098,709 thousand as of June 30, 2021, up from $33,638,602 thousand at December 31, 2020, representing a growth of 4.3%[14]. - The total deposits increased to $29,273,107 thousand as of June 30, 2021, up from $27,697,877 thousand at December 31, 2020, representing a growth of 5.7%[14]. - The company reported a net increase in deposits of $1,575,231 for the six months ended June 30, 2021, compared to $3,518,693 in the same period of 2020[23]. Credit Quality and Losses - The provision for credit losses was $(17,229) thousand for the three months ended June 30, 2021, compared to $306,898 thousand for the same period in 2020, indicating a significant improvement in credit quality[16]. - The provision for credit losses for the six months ended June 30, 2021, was $(22,140), a significant decrease from $553,691 in the same period of 2020[23]. - The net provision for loan losses was $(21,757) thousand, indicating a reduction in reserves[55]. - The net provision for loan losses was $548,424 thousand for the six months ended June 30, 2021, compared to $191,251 thousand for the same period in 2020, representing a substantial increase of 187%[57]. - Nonperforming loans declined by 24% and criticized commercial loans decreased by 5%[189]. Noninterest Income and Expenses - Noninterest income increased to $94,272 thousand for the three months ended June 30, 2021, up from $73,943 thousand in the same period of 2020, reflecting a growth of 27.4%[16]. - Total noninterest expense for the three months ended June 30, 2021, was $236,770 thousand, compared to $196,539 thousand for the same period in 2020, an increase of 20.5%[16]. - The company reported total other noninterest income of $17,881,000 for the three months ended June 30, 2021, compared to $13,134,000 for the same period in 2020, reflecting an increase of approximately 36.5%[112]. Securities and Investments - As of June 30, 2021, the total amortized cost of available-for-sale debt securities was $7,190,161, with a fair value of $7,300,421, reflecting a gross unrealized gain of $167,593[34]. - The company reported proceeds from sales of securities totaling $198,681 for the six months ended June 30, 2021, compared to $124,122 for the same period in 2020, indicating a significant increase in activity[36]. - The fair value of securities pledged as collateral was $3.0 billion at June 30, 2021, down from $3.4 billion at December 31, 2020, reflecting a decrease in collateralized assets[36]. Loans and Lending Activities - The total loans as of June 30, 2021, amounted to $21,148.53 million, a decrease from $21,789.93 million as of December 31, 2020, representing a decline of approximately 2.9%[45]. - The company reported a total of $71.5 million in accrued interest as of June 30, 2021, compared to $76.2 million as of December 31, 2020[44]. - The company reported a net increase in loans of $670,795 for the six months ended June 30, 2021, compared to a net decrease of $(2,029,351) in the same period of 2020[23]. Risk Management and Economic Outlook - The company anticipates a GDP growth of 6.9% in 2021, 5.0% in 2022, and 2.3% in 2023, indicating a positive economic outlook[57]. - Management highlighted the potential impact of COVID-19 on business operations and credit portfolio, emphasizing the need for effective risk management[165]. - The company expects net interest margin to compress an additional 4 basis points in Q3 2021 and 5 basis points in Q4 2021, with an anticipated full-year decline of 30 basis points compared to 2020[197]. Shareholder Returns and Stock Activity - The company declared dividends of $0.27 per share for both the three months ended June 30, 2021, and 2020, maintaining consistent dividend payments[16]. - The Company entered into a stock buyback program on April 22, 2021, authorizing the repurchase of up to 4.3 million shares of common stock[101]. - The Company repurchased 4.9 million shares under a previous buyback program at an average price of $37.65 per share[102].

Second Quarter 2021 Earnings Conference Call 7/20/2021 Important cautionary statement about forward-looking statements This presentation contains forward-looking statements within the meaning of section 27A of the Securities Act of 1933, as amended, and section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements that we may make include statements regarding our expectations of our performance and financial condition, balance sheet and revenue growth, the provision for credit l ...

Hancock Whitney Corporation (NASDAQ:HWC) Q2 2021 Earnings Conference Call July 20, 2021 5:00 PM ET Company Participants Trisha Carlson - Investor Relations Manager John Hairston - President and CEO Mike Achary - CFO Chris Ziluca - Chief Credit Officer Conference Call Participants Michael Rose - Raymond James Brett Rabatin - Hovde Group Brad Milsaps - Piper Sandler Jennifer Demba - Truist Securities Catherine Mealor - KBW Matt Olney - Stephens Kevin Fitzsimmons - D. A. Davidson Operator Good day, ladies and ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q HANCOCK WHITNEY CORPORATION (Exact name of registrant as specified in its charter) (Mark one) Mississippi 64-0693170 (State or other jurisdiction of incorporation or organization) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Hancock Whitney Plaza, 2510 14th Street, Gulfport, Mississippi 39501 (Address of principal executive offices) (Zip Code) For the quarterly period ended March 31 ...

First Quarter 2021 Earnings Conference Call 4/20/2021 Important cautionary statement about forward-looking statements This presentation contains forward-looking statements within the meaning of section 27A of the Securities Act of 1933, as amended, and section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements that we may make include statements regarding our expectations regarding our performance and financial condition, balance sheet and revenue growth, the provision for cr ...

Financial Data and Key Metrics Changes - Earnings for Q1 2021 were $107 million or $1.21 per share, an increase of almost $4 million or $0.04 from the previous quarter [7] - The provision for credit losses was a negative $4.9 million, indicating a release of loan loss reserves due to improved asset quality [8] - The common Tier 1 capital ratio increased by 41 basis points to an estimated 11.02% [10] Business Line Data and Key Metrics Changes - Core loans declined by $465 million linked quarter, primarily due to a runoff in indirect loans and increased residential mortgage payoffs [9] - The bank originated over $800 million in new PPP loans during the first quarter, with a lower-than-expected pace of forgiveness [9] Market Data and Key Metrics Changes - The bank reported declines in criticized and nonperforming loans of 11% and 20%, respectively [8] - The Eastern franchise showed loan growth, while the Central area, particularly New Orleans, remained under pressure but showed signs of improvement [9] Company Strategy and Development Direction - The company is focused on expense and efficiency initiatives, including an early retirement program expected to reduce expenses by approximately $19 million annually [15][16] - The management is cautiously optimistic about 2021 and beyond, depending on the success of vaccination programs and economic recovery [10] Management's Comments on Operating Environment and Future Outlook - Management noted a more positive operating environment compared to the end of the previous year, with signs of cautious optimism as markets reopen [7] - The company expects loan growth to pick up in the second half of the year, driven by an improved pipeline and economic conditions [22] Other Important Information - The bank's net interest margin (NIM) for the quarter was 3.09%, down 13 basis points, with expectations of further compression in the second quarter [13] - The early retirement program had a 40% acceptance rate, which was higher than expected, contributing to future expense reductions [48] Q&A Session Summary Question: Margin outlook and loan growth dependency - Management indicated that NIM stabilization is dependent on loan growth picking up in the second half of the year, with expectations of further compression in Q2 [20][21] Question: Capital returns and buyback plans - Management confirmed that they are evaluating options for capital returns, including potential buybacks, as capital builds from PPP loan forgiveness [25][26] Question: Expense guidance and operating leverage - Management acknowledged that while there will be natural growth in expenses, they aim for a significant reduction in overall expenses, targeting a more efficient operating model [31][32] Question: Loan growth appetite and mortgage paydowns - Management noted that while there is a strong appetite for home purchases, they do not plan to refill the mortgage bucket until the rate environment improves [59] Question: Green shoots in tourism and hospitality - Management reported positive changes in the hospitality outlook, particularly in New Orleans, with expectations for leisure tourism to rebound significantly [50][53]

PART I [ITEM 1. BUSINESS](index=7&type=section&id=ITEM%201.%20BUSINESS) Hancock Whitney Corporation is a regulated financial services company in the U.S. Gulf South, offering banking, trust, and investment services, with **$33.6 billion in assets** - **Key Financial Metrics (as of Dec 31, 2020)** | Metric | Amount (Billion USD) | | :--- | :--- | | Total Assets | $33.6 | | Total Loans | $21.8 | | Total Deposits | $27.7 | - The company's strategic focus in 2020 was on navigating the COVID-19 pandemic and a highly active hurricane season by de-risking its balance sheet, which included divesting a significant portion of its energy loan portfolio and issuing **$172.5 million of subordinated debt**[22](index=22&type=chunk) - The company operates primarily in the Gulf South region, including Mississippi, Alabama, Louisiana, Florida, and Texas, with a loan production office in Nashville, Tennessee[20](index=20&type=chunk) - As of December 31, 2020, the company had **3,986 full-time equivalent employees**, with headcount reduced by approximately **5%** in the latter half of 2020 through attrition and other efficiency initiatives[54](index=54&type=chunk) [Loan Portfolio and Underwriting](index=7&type=section&id=Loan%20Portfolio%20and%20Underwriting) The Bank's lending focuses on commercial, consumer, and real estate loans, with underwriting standards designed for consistency and risk management - The Bank's lending focuses on commercial, consumer, and real estate loans. Underwriting standards are designed for consistency and risk management, with specific policies for loan concentrations, collateral, and approval hierarchies[24](index=24&type=chunk)[25](index=25&type=chunk) - **Portfolio Segment Concentrations (as of Dec 31, 2020)** | Portfolio Segment | Concentration (% of risk-based capital) | | :--- | :--- | | Commercial non-real estate | 527% | | Commercial real estate - owner occupied | 103% | | Commercial real estate-income producing | 121% | | Construction and land development | 78% | | Residential mortgage | 92% | | Consumer | 121% | - The loan portfolio includes loans made under the SBA's Paycheck Protection Program (PPP), which are guaranteed by the SBA, bear **1% interest**, and have two or five-year terms[34](index=34&type=chunk) [Securities Portfolio](index=12&type=section&id=Securities%20Portfolio) The investment portfolio primarily consists of U.S. agency debt, mortgage-related securities, and municipal obligations, managed with a target effective duration of two to five and a half years - The investment portfolio primarily consists of U.S. agency debt, mortgage-related securities, and municipal obligations. It is managed with a target effective duration of **two to five and a half years**[47](index=47&type=chunk) - A significant portion of the securities portfolio is used to secure certain deposits and other liabilities, with limits on the percentage pledged to maintain liquidity[48](index=48&type=chunk) [Deposits and Trust Services](index=12&type=section&id=Deposits%20and%20Trust%20Services) Deposits are the most significant funding source, with levels in 2020 influenced by pandemic-driven factors, and the trust department managing approximately **$27.0 billion of assets** - Deposits are the most significant funding source. Deposit levels in 2020 were influenced by pandemic-driven factors, including government stimulus payments and PPP loan proceeds[50](index=50&type=chunk) - Brokered deposits decreased to **$14 million** at year-end 2020, as the company did not renew maturing brokered deposits due to strong growth in transaction and savings deposits[52](index=52&type=chunk) - The Bank's trust department had approximately **$27.0 billion of assets under administration** at December 31, 2020[53](index=53&type=chunk) [Supervision and Regulation](index=14&type=section&id=Supervision%20and%20Regulation) The company is a financial holding company subject to extensive supervision by federal and state authorities, with regulations primarily protecting consumers, depositors, and the Deposit Insurance Fund - The Company is a financial holding company subject to extensive supervision by the Federal Reserve, FDIC, and other state and federal agencies. Regulations are intended primarily for the protection of consumers, depositors, and the Deposit Insurance Fund (DIF)[64](index=64&type=chunk)[66](index=66&type=chunk)[67](index=67&type=chunk) - The Company and the Bank are subject to minimum capital requirements under Basel III rules. Both entities must maintain a capital conservation buffer of **2.5%** above minimums to avoid restrictions on dividends and share buybacks[79](index=79&type=chunk)[82](index=82&type=chunk) - **Company and Bank Capital Ratios (as of Dec 31, 2020)** | Ratio | Minimum + Buffer | Company | Bank | | :--- | :--- | :--- | :--- | | Tier 1 leverage capital | N/A | 7.88% | 8.11% | | Common Equity Tier 1 capital | 7.00% | 10.61% | 10.94% | | Tier 1 capital | 8.50% | 10.61% | 10.94% | | Total risk-based capital | 10.50% | 13.22% | 12.19% | - The Company adopted the CECL accounting standard on January 1, 2020, and elected the optional five-year transition period to delay the estimated impact on regulatory capital[87](index=87&type=chunk)[88](index=88&type=chunk) [ITEM 1A. RISK FACTORS](index=23&type=section&id=ITEM%201A.%20RISK%20FACTORS) The company faces material risks across economic, financial industry, operational, strategic, legal, and regulatory categories, including COVID-19 impacts and LIBOR transition challenges [Risks Related to Economic and Market Conditions](index=23&type=section&id=Risks%20Related%20to%20Economic%20and%20Market%20Conditions) The COVID-19 pandemic has created extensive disruptions, adversely impacting credit risk, collateral values, customer demand, and operational stability, with the ultimate impact remaining highly uncertain - The COVID-19 pandemic has created extensive disruptions, adversely impacting credit risk, collateral values, customer demand, and operational stability. The ultimate impact remains highly uncertain[122](index=122&type=chunk)[123](index=123&type=chunk) - The company has significant lending concentrations in commercial real estate, healthcare, hospitality, and energy, making it vulnerable to downturns in these sectors, which have been exacerbated by COVID-19[138](index=138&type=chunk) - The transition away from LIBOR after 2021 presents a significant risk, as it could adversely affect interest rates on a substantial portion of the company's variable-rate loans, derivatives, and other financial instruments[152](index=152&type=chunk)[154](index=154&type=chunk) [Risks Related to the Financial Services Industry](index=30&type=section&id=Risks%20Related%20to%20the%20Financial%20Services%20Industry) Effective liquidity management is essential, and access to funding could be impaired by factors affecting the financial services industry or the broader economy, while the CECL accounting standard adds potential volatility to credit loss allowances - Effective liquidity management is essential, and access to funding could be impaired by factors affecting the financial services industry or the broader economy[161](index=161&type=chunk) - The adoption of the CECL accounting standard on January 1, 2020, accelerates the recognition of expected credit losses and adds potential volatility to the allowance for credit losses due to its forward-looking nature[165](index=165&type=chunk) [Risks Related to Our Operations](index=31&type=section&id=Risks%20Related%20to%20Our%20Operations) The company is dependent on operational systems and infrastructure, and a failure or breach, including those of third-party vendors, could disrupt business, result in financial loss, and damage its reputation, with cybersecurity risks heightened by remote work - The company is dependent on operational systems and infrastructure, and a failure or breach, including those of third-party vendors, could disrupt business, result in financial loss, and damage its reputation[168](index=168&type=chunk)[169](index=169&type=chunk) - Cybersecurity risks have dramatically increased due to new technologies and sophisticated attackers. The transition to remote work during the COVID-19 pandemic has heightened these risks[173](index=173&type=chunk)[174](index=174&type=chunk) [Risks Related to Our Business Strategy](index=33&type=section&id=Risks%20Related%20to%20Our%20Business%20Strategy) The financial services industry is highly competitive, requiring adaptation to new technology-driven products and services, while future growth through acquisitions carries risks such as integration challenges and potential overpayment - The financial services industry is highly competitive, with pressure from larger institutions and non-bank competitors not subject to the same regulatory oversight. Success depends on the ability to adapt to new technology-driven products and services[181](index=181&type=chunk)[182](index=182&type=chunk) - Future growth may depend on acquisitions, which carry risks such as failing to obtain regulatory approval, integration challenges, and potentially overpaying for targets in a competitive M&A environment[188](index=188&type=chunk)[190](index=190&type=chunk)[191](index=191&type=chunk) [ITEM 1B. UNRESOLVED STAFF COMMENTS](index=40&type=section&id=ITEM%201B.%20UNRESOLVED%20STAFF%20COMMENTS) The company reports no unresolved staff comments from the SEC - None[220](index=220&type=chunk) [ITEM 2. PROPERTIES](index=40&type=section&id=ITEM%202.%20PROPERTIES) The company operates **208 full-service banking offices** and **275 ATMs** across the Gulf South, with its main office in Gulfport, Mississippi - The Company operates **208 full-service banking offices** and **275 automated teller machines** across its primary markets in the Gulf South[222](index=222&type=chunk) - Approximately **48%** of the company's banking facilities are owned, with the remaining facilities being leased[222](index=222&type=chunk) [ITEM 3. LEGAL PROCEEDINGS](index=40&type=section&id=ITEM%203.%20LEGAL%20PROCEEDINGS) The company is party to various legal proceedings arising in the ordinary course of business but does not believe any pending matters will have a material adverse effect on its financial position or liquidity - The company does not expect any pending legal proceedings to have a material adverse effect on its consolidated financial position or liquidity[223](index=223&type=chunk) [ITEM 4. MINE SAFETY DISCLOSURES](index=40&type=section&id=ITEM%204.%20MINE%20SAFETY%20DISCLOSURES) This item is not applicable to the company's operations - Not applicable[224](index=224&type=chunk) PART II [ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES](index=41&type=section&id=ITEM%205.%20MARKET%20FOR%20THE%20REGISTRANT%27S%20COMMON%20EQUITY%2C%20RELATED%20STOCKHOLDER%20MATTERS%20AND%20ISSUER%20PURCHASES%20OF%20EQUITY%20SECURITIES) The company's common stock trades on NASDAQ under 'HWC', and it repurchased approximately **4.9 million shares** at an average of **$37.65 per share** under a program that expired in 2020 - The Company's common stock is traded on the NASDAQ Global Select Market under the ticker symbol "**HWC**"[226](index=226&type=chunk) - A stock buyback program authorized in September 2019 for up to **5.5 million shares** expired on December 31, 2020. The company repurchased approximately **4.9 million shares** at an average price of **$37.65 per share** under this program[233](index=233&type=chunk)[235](index=235&type=chunk) - Final settlement of a **$185 million** Accelerated Share Repurchase (ASR) agreement occurred on March 18, 2020, resulting in a final delivery of **1,001,472 shares** and a cash receipt of approximately **$12.1 million**[234](index=234&type=chunk) [ITEM 6. SELECTED FINANCIAL DATA](index=43&type=section&id=ITEM%206.%20SELECTED%20FINANCIAL%20DATA) The company reported a **net loss of $45.2 million** in 2020, driven by a **$602.9 million provision for credit losses**, despite growth in total assets to **$33.6 billion** and deposits to **$27.7 billion** - **Selected Financial Data (2020 vs. 2019)** | Metric (in thousands, except per share) | 2020 | 2019 | | :--- | :--- | :--- | | Net income (loss) | $(45,174) | $327,380 | | Diluted earnings (loss) per share | $(0.54) | $3.72 | | Provision for credit losses | $602,904 | $47,708 | | Total assets (period-end) | $33,638,602 | $30,600,757 | | Total loans (period-end) | $21,789,931 | $21,212,755 | | Total deposits (period-end) | $27,697,877 | $23,803,575 | | Return on average assets | (0.14%) | 1.12% | | Net charge-offs to average loans | 1.78% | 0.23% | [ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS](index=47&type=section&id=ITEM%207.%20MANAGEMENT%27S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS) The company recorded a **$45.2 million net loss** in 2020, primarily due to a **$602.9 million provision for credit losses**, while assets grew to **$33.6 billion** and deposits to **$27.7 billion** [Executive Overview](index=47&type=section&id=Executive%20Overview) The company reported a **$45.2 million net loss** for 2020, heavily impacted by a **$602.9 million provision for credit losses**, despite stable operating pre-provision net revenue and significant growth in assets and deposits - The company reported a **net loss of $45.2 million** for 2020, heavily impacted by a **$602.9 million provision for credit losses**. This provision included **$160.1 million** related to the sale of a substantial portion of the energy loan portfolio[265](index=265&type=chunk) - Operating pre-provision net revenue (PPNR) was stable at **$491.2 million**, up slightly from 2019. Total assets grew **10%** to **$33.6 billion**, and deposits grew **16%** to **$27.7 billion**[252](index=252&type=chunk)[265](index=265&type=chunk) - The company participated in the Paycheck Protection Program (PPP), originating over **13,000 loans** totaling **$2.4 billion** in 2020, which contributed to loan growth and net interest income[257](index=257&type=chunk)[258](index=258&type=chunk) - Net interest margin (NIM) decreased by **17 basis points** to **3.27%** due to sharp interest rate contractions and a changing asset/liability mix from excess liquidity[265](index=265&type=chunk) [Results of Operations](index=50&type=section&id=Results%20of%20Operations) Net interest income increased by **5%** to **$955.5 million** in 2020, driven by growth in earning assets, while the provision for credit losses surged to **$602.9 million** due to the pandemic and an energy loan sale - Net interest income (tax-equivalent) increased by **5%** to **$955.5 million** in 2020, driven by a **$2.8 billion increase** in average earning assets, primarily from PPP loans and the MidSouth acquisition[271](index=271&type=chunk) - The provision for credit losses surged to **$602.9 million** in 2020 from **$47.7 million** in 2019, reflecting the economic impact of the pandemic and a **$160.1 million provision** for the energy loan sale[283](index=283&type=chunk) - Noninterest income increased by **3%** to **$324.4 million**, largely due to a **103% increase** in income from secondary mortgage market operations (**$40.2 million**) amid a favorable rate environment for refinancing[287](index=287&type=chunk)[293](index=293&type=chunk) - Noninterest expense rose **2%** to **$788.8 million**. Excluding prior-year merger costs, operating expenses increased by **7%**, driven by higher personnel costs and OREO write-downs[297](index=297&type=chunk) - The company recorded an income tax benefit at an effective rate of **63.8%** due to a pre-tax loss and benefits from the CARES Act, which allowed for a net operating loss (NOL) carryback to a higher tax rate year[310](index=310&type=chunk) [Balance Sheet Analysis](index=60&type=section&id=Balance%20Sheet%20Analysis) Total loans grew by **$0.6 billion** (3%) to **$21.8 billion**, primarily due to PPP loan originations, while total deposits increased by **$3.9 billion** (16%) to **$27.7 billion**, with noninterest-bearing deposits comprising **44%** - Total loans grew by **$0.6 billion (3%)** to **$21.8 billion**, primarily due to **$2.4 billion** in PPP loan originations, which was partially offset by the sale of a portion of the energy loan portfolio[326](index=326&type=chunk)[329](index=329&type=chunk) - The energy loan portfolio was significantly reduced to **$308 million** from **$1.0 billion** at year-end 2019, mainly due to a **$497 million loan sale** in July 2020[331](index=331&type=chunk) - Total deposits increased by **$3.9 billion (16%)** to **$27.7 billion**, with noninterest-bearing deposits growing **39%** to **$12.2 billion**, comprising **44%** of total deposits[368](index=368&type=chunk)[369](index=369&type=chunk) - The Allowance for Credit Losses (ACL) increased to **$480.1 million (2.20% of total loans)** from **$195.2 million**, reflecting the adoption of CECL and a significant reserve build due to the pandemic's economic impact[356](index=356&type=chunk) [Enterprise Risk Management](index=75&type=section&id=Enterprise%20Risk%20Management) The company manages risk through a framework overseen by the Board of Directors and senior management, focusing on seven primary risk categories, while actively managing interest rate risk and the transition from LIBOR - The company manages risk through a framework overseen by the Board of Directors and senior management, focusing on seven primary risk categories: credit, market, liquidity, operational, legal, reputational, and strategic[386](index=386&type=chunk)[387](index=387&type=chunk) - Asset/Liability management is a key function, utilizing models to quantify and control interest rate risk (IRR) with the objective of maintaining a stable net interest income[396](index=396&type=chunk)[399](index=399&type=chunk) - The company has a LIBOR Transition Working Group to manage the risks associated with the discontinuation of LIBOR. As of year-end 2020, approximately **30%** of the loan portfolio was tied to LIBOR[408](index=408&type=chunk)[409](index=409&type=chunk) - At December 31, 2020, the company had **$17.5 billion** in net available sources of liquidity from internal and external sources, demonstrating a strong liquidity position[410](index=410&type=chunk)[411](index=411&type=chunk) [Capital Resources](index=81&type=section&id=Capital%20Resources) Stockholders' equity totaled **$3.4 billion** at year-end 2020, with all regulatory capital ratios remaining well in excess of minimum requirements, including a Common Equity Tier 1 (CET1) ratio of **10.61%** - Stockholders' equity totaled **$3.4 billion** at year-end 2020, a slight decrease from **$3.5 billion** in 2019, attributable to the net loss and dividends, partially offset by gains in other comprehensive income[428](index=428&type=chunk) - All regulatory capital ratios remained well in excess of minimum requirements, including the capital conservation buffer. The Common Equity Tier 1 (CET1) ratio was **10.61%** at December 31, 2020[431](index=431&type=chunk)[432](index=432&type=chunk) - The company maintained its quarterly dividend of **$0.27 per share** throughout 2020, continuing an uninterrupted quarterly dividend payment history since 1967[437](index=437&type=chunk) [ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK](index=87&type=section&id=ITEM%207A.%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK) The company's primary market risk is interest rate risk, with an asset-sensitive balance sheet projecting a **3.95% increase in net interest income** for a **+100 basis point rate shock** in year one - **Net Interest Income (NII) at Risk (as of Dec 31, 2020)** | Change in Interest Rates (bps) | Estimated Increase in NII (Year 1) | Estimated Increase in NII (Year 2) | | :--- | :--- | :--- | | +100 | 3.95% | 6.47% | | +200 | 8.62% | 14.13% | | +300 | 13.19% | 21.55% | - The company's balance sheet is generally asset-sensitive, driven by variable-rate loans and a high volume of non-interest bearing and low-rate sensitive deposits[402](index=402&type=chunk) [ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA](index=88&type=section&id=ITEM%208.%20FINANCIAL%20STATEMENTS%20AND%20SUPPLEMENTARY%20DATA) This section presents the company's audited consolidated financial statements and the independent auditor's unqualified report, highlighting the adoption of the CECL accounting standard [Note 1. Summary of Significant Accounting Policies and Recent Accounting Pronouncements](index=100&type=section&id=Note%201.%20Summary%20of%20Significant%20Accounting%20Policies%20and%20Recent%20Accounting%20Pronouncements) The company adopted the CECL accounting standard on January 1, 2020, requiring the measurement of expected credit losses over the life of financial assets - The company adopted ASC Topic 326, "Financial Instruments – Credit Losses" (CECL), on January 1, 2020. This new standard requires the measurement of expected credit losses over the life of financial assets based on historical experience, current conditions, and reasonable forecasts[508](index=508&type=chunk)[588](index=588&type=chunk) - **Impact of CECL Adoption (Jan 1, 2020)** | Item | Impact (in thousands) | | :--- | :--- | | Increase in Allowance for Loan Losses | $49,411 | | Increase in Reserve for Unfunded Commitments | $27,330 | | **Total Increase in Allowance for Credit Losses** | **$76,741** | | **Decrease to Retained Earnings (after-tax)** | **$44,087** | [Note 2. Business Combination](index=112&type=section&id=Note%202.%20Business%20Combination) On September 21, 2019, the company acquired MidSouth Bancorp, Inc. for **$193.8 million**, recording **$63.4 million in goodwill** - On September 21, 2019, the Company completed the acquisition of MidSouth Bancorp, Inc. The transaction was valued at **$193.8 million**, resulting in the acquisition of **$130.5 million** in net assets and the recording of **$63.4 million in goodwill**[597](index=597&type=chunk)[599](index=599&type=chunk) - The company incurred approximately **$32.7 million** in acquisition-related costs in 2019, including severance, professional services, and contract termination fees[600](index=600&type=chunk) [Note 4. Loans and Allowance for Credit Losses](index=118&type=section&id=Note%204.%20Loans%20and%20Allowance%20for%20Credit%20Losses) In 2020, the company sold **$497 million** of its energy loan portfolio to reduce risk, increasing the allowance for credit losses to **$450.2 million** - In 2020, the Company sold **$497 million** of its energy loan portfolio for net proceeds of approximately **$254.4 million** to reduce risk in the loan portfolio[619](index=619&type=chunk) - The allowance for credit losses increased from **$191.3 million** at year-end 2019 to **$450.2 million** at year-end 2020. This includes a **$49.4 million** adjustment upon adopting CECL and a **$604.3 million provision** for loan losses during the year, offset by net charge-offs[624](index=624&type=chunk) - At December 31, 2020, there were **176 loans** totaling **$630.6 million** with active short-term payment deferrals or other modifications under the CARES Act[635](index=635&type=chunk) [ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE](index=158&type=section&id=ITEM%209.%20CHANGES%20IN%20AND%20DISAGREEMENTS%20WITH%20ACCOUNTANTS%20ON%20ACCOUNTING%20AND%20FINANCIAL%20DISCLOSURE) The company reports no changes in or disagreements with its accountants on accounting and financial disclosure - None[797](index=797&type=chunk) [ITEM 9A. CONTROLS AND PROCEDURES](index=158&type=section&id=ITEM%209A.%20CONTROLS%20AND%20PROCEDURES) Management concluded that the company's disclosure controls and procedures and internal control over financial reporting were effective as of December 31, 2020, with no material changes during the fourth quarter - Management concluded that the company's disclosure controls and procedures were effective as of December 31, 2020[799](index=799&type=chunk) - Based on an evaluation using the COSO framework, management concluded that the company's internal control over financial reporting was effective as of December 31, 2020[801](index=801&type=chunk) [ITEM 9B. OTHER INFORMATION](index=158&type=section&id=ITEM%209B.%20OTHER%20INFORMATION) The company announced its Annual Meeting of Shareholders will be held virtually on Wednesday, April 21, 2021 - The Annual Meeting of Shareholders is scheduled for April 21, 2021, to be held virtually[803](index=803&type=chunk) PART III [ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE](index=158&type=section&id=ITEM%2010.%20DIRECTORS%2C%20EXECUTIVE%20OFFICERS%20AND%20CORPORATE%20GOVERNANCE) Information regarding directors, corporate governance, and compliance with Section 16(a) is incorporated by reference from the company's definitive proxy statement for its 2021 annual meeting, with executive officer information provided in Part I - Information required by this item concerning directors and corporate governance is incorporated by reference from the company's definitive proxy statement for the 2021 annual meeting of shareholders[804](index=804&type=chunk) - Information regarding executive officers is presented in Part I of this Form 10-K[805](index=805&type=chunk) [ITEM 11. EXECUTIVE COMPENSATION](index=159&type=section&id=ITEM%2011.%20EXECUTIVE%20COMPENSATION) Information concerning executive and director compensation, including the Compensation Discussion and Analysis, is incorporated by reference from the company's definitive proxy statement for its 2021 annual meeting - Information required by this item is incorporated by reference from the company's definitive proxy statement for the 2021 annual meeting of shareholders[806](index=806&type=chunk) [ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS](index=159&type=section&id=ITEM%2012.%20SECURITY%20OWNERSHIP%20OF%20CERTAIN%20BENEFICIAL%20OWNERS%20AND%20MANAGEMENT%20AND%20RELATED%20STOCKHOLDER%20MATTERS) Information regarding security ownership of certain beneficial owners and management is incorporated by reference from the company's definitive proxy statement for its 2021 annual meeting - Information required by this item is incorporated by reference from the company's definitive proxy statement for the 2021 annual meeting of shareholders[807](index=807&type=chunk) [ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE](index=159&type=section&id=ITEM%2013.%20CERTAIN%20RELATIONSHIPS%20AND%20RELATED%20TRANSACTIONS%2C%20AND%20DIRECTOR%20INDEPENDENCE) Information concerning related party transactions and director independence is incorporated by reference from the company's definitive proxy statement for its 2021 annual meeting - Information required by this item is incorporated by reference from the company's definitive proxy statement for the 2021 annual meeting of shareholders[808](index=808&type=chunk) [ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES](index=159&type=section&id=ITEM%2014.%20PRINCIPAL%20ACCOUNTANT%20FEES%20AND%20SERVICES) Information regarding principal accountant fees and services is incorporated by reference from the company's definitive proxy statement for its 2021 annual meeting - Information required by this item is incorporated by reference from the company's definitive proxy statement for the 2021 annual meeting of shareholders[809](index=809&type=chunk) PART IV [ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES](index=160&type=section&id=ITEM%2015.%20EXHIBITS%2C%20FINANCIAL%20STATEMENT%20SCHEDULES) This section lists the financial statements, financial statement schedules, and exhibits filed as part of the Form 10-K report, including consolidated financial statements and various agreements and certifications - This section lists all documents filed as part of the report, including the consolidated financial statements, consents of the independent registered public accounting firm, and certifications by the CEO and CFO[811](index=811&type=chunk)[812](index=812&type=chunk) [ITEM 16. FORM 10-K SUMMARY](index=163&type=section&id=ITEM%2016.%20FORM%2010-K%20SUMMARY) This item is not applicable to the company's filing - Not applicable[816](index=816&type=chunk)