Hancock Holding sees quarterly profit tumble
Published: January 27,2014
GULFPORT — Hancock Holding Co. said profit in 2013’s fourth quarter fell 26 percent as it spent $17.1 million to improve efficiency.
Hancock, which operates Hancock Bank in Mississippi, Alabama and Florida, and Whitney Bank in Louisiana and Texas, posted quarterly profit yesterday of $34.7 million, or 41 cents per share. That’s down from $47 million, or 54 cents per share, in 2012’s fourth quarter.
Analysts polled by FactSet had estimated 56 cents per share, on average, excluding one-time efficiency costs. Hancock said it would have earned 55 cents per share, or $45.8 million, on that basis.
CEO Carl Chaney said that despite the spending, the bank’s “core results” are improving, laying the groundwork for stronger future profits.
“Improvements are being noted in many areas such as loan growth and mix, core net interest income and core net interest margin, and a reduction in operating expenses,” Chaney said in a statement.
For all of 2012, Hancock recorded a profit $163.4 million, or $1.93 per share. That’s up 8 percent from $151.7 million, or $1.75 a share, in 2012.
Hancock said loans increased $590 million in the quarter, with strength in south Louisiana, the Houston area and Florida. The company said general business lending increased the most, followed by commercial real estate loans.
The company set aside $7.3 million for future bad loans. That’s down from the $32.7 million the bank put aside in the last three months of 2012, and slightly below what it set aside in 2013’s third quarter.
Hancock cut another 90 employees during the quarter, putting its number of workers 6 percent below the end of 2012.
Return on average assets, a key measure of bank profitability, was 0.74 percent in the fourth quarter, but would have been 0.97 percent without the efficiency spending. That’s close to the national average of 0.99 percent that all banks nationwide achieved in the three months ended Sept. 30, according to Federal Deposit Insurance Corp. statistics
The amount that the company collected in interest from borrowers, net of what it paid out to savers, fell to $168 million. The net interest margin, a measure of that spread divided by all loans, fell to 4.09 percent in 2013’s fourth quarter, down from 4.23 percent for the fourth quarter of 2012. That spread is traditionally a basic ingredient of bank profits.
Gulfport-based Hancock has $19 billion in assets.
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