Hancock’s earnings hit by Gulf oil spill
GULFPORT — Hancock Holding Co. took a 52 percent drop in second-quarter earnings as the company set aside more money for loan losses, including some potentially tied to the Gulf of Mexico oil spill, the company reported yesterday.
For the three months ending June 30, Hancock earned $6.5 million, or 17 cents per share, compared with year-ago earnings in the second quarter of $13.7 million, or 43 cents per share.
The results fell far short of Wall Street forecasts. Analysts surveyed by Thomson Reuters, on average, had forecast per-share earnings of 44 cents per share.
Hancock said it expected “significant and potentially lasting impact to the coastal regions in the four states that comprise Hancock’s footprint.” Although the company has $136.1 million in loan exposure to coastal areas of Louisiana, Mississippi, Alabama and Florida, a review concluded that only about $26.1 million would be impacted negatively by the oil spill, Hancock said.
The coastal loan exposure represents 2.7 percent of Hancock’s total loan portfolio, the company said.
During the second quarter, Hancock increased its allowance for loan losses $10.6 million, or 15.9 percent, to $77.2 million. Credit quality deterioration due to the national economic downturn and lower real estate prices resulted in a $41.4 million increase in substandard loans, the company said.
Hancock also set aside another $5.2 million to cover potential loan losses resulting from the oil spill.
The company said its average total loans were $5.01 billion in the second quarter, up 17.1 percent from a year ago, but down 1.6 percent from the first quarter of 2010.
The results were released after financial markets closed. In trading yester, Hancock share rose 35 cents to close at $33.25. The shares have closed in a 52-week range of $32.15 to $45.86.
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