Hancock Whitney demonstrated a commendable financial performance in the second quarter of 2025, marked by strategic growth and operational efficiency. The institution witnessed an expansion in its Net Interest Margin (NIM) and a notable improvement in its adjusted Return on Assets (ROA), reflecting a disciplined approach to managing its financial health. Key drivers of this success included a rise in Net Interest Income (NII) and a significant increase in fee-based revenues, bolstered by the strategic acquisition of Sable Trust Company. Despite a slight dip in overall deposit balances, the bank successfully enhanced its Demand Deposit Account (DDA) mix and achieved solid loan portfolio expansion. Furthermore, Hancock Whitney maintained robust capital ratios, signaling financial stability and a commitment to shareholder returns through consistent share repurchases, alongside ongoing investments in organic growth through new talent acquisition and the establishment of new financial centers. This performance underscores the bank's resilience and forward-looking strategy in a dynamic economic landscape.
During the second quarter of 2025, Hancock Whitney's financial indicators painted a picture of steady progress. The Net Interest Margin saw an increase of six basis points, while the adjusted Return on Assets reached 1.37%, even after accounting for the expenses associated with the Sable Trust Company transaction, which was finalized on May 2nd. The firm's adjusted net income stood at $118 million, translating to $1.37 per share, a marginal decrease from the prior quarter's figures. However, Pre-Provision Net Revenue (PPNR) showed a positive trend, increasing by $5 million, or 3%, sequentially, achieving an impressive 1.95% of assets. Net Interest Income also saw a healthy rise of $7 million, or 2%, on a quarter-over-quarter basis, complemented by a 4% increase in fee income, largely attributable to the Sable Trust integration.
Operational efficiency was also a highlight, with the efficiency ratio improving to 54.91% from 55.22% in the first quarter of 2025. Loan growth was particularly robust, expanding by $364 million, an annualized 6% increase, despite unchanged guidance for low single-digit annual growth. Deposit balances experienced a reduction of $148 million, primarily due to Certificate of Deposit (CD) run-offs and lower public funds. Nevertheless, Demand Deposit Account (DDA) and interest-bearing transaction balances showed an uptick, pushing the DDA mix to 37%. The company also managed to decrease its cost of funds by two basis points to 1.57%, driven by reduced deposit costs. The loan yield increased slightly by two basis points to 5.86%, with fixed-rate loan yields rising significantly by thirteen basis points. Capital strength remained a cornerstone, with Tangible Common Equity (TCE) at 9.84% and Common Equity Tier 1 at 14.03% post-acquisition, and the Allowance for Credit Losses (ACL) maintained at 1.45% of loans.
Hancock Whitney’s strategic focus extends beyond immediate financial metrics, encompassing long-term organic growth and capital management. The bank is actively expanding its footprint and talent pool, with plans to add new bankers and open additional financial centers in key growth markets, notably Dallas. Management has articulated a clear strategy for capital deployment, prioritizing organic balance sheet expansion, followed by shareholder returns through dividends and share repurchases. The company’s intent to maintain a consistent pace of share repurchases, targeting a dollar amount rather than a fixed share count, reflects a flexible approach to capital management based on market conditions and share valuation. Credit quality remains strong, with no significant concerns identified across the loan portfolio, and expectations for net charge-offs to normalize within the projected range for the full year 2025. This comprehensive strategy, combining prudent financial management with targeted growth initiatives, positions Hancock Whitney for sustained success in the evolving financial landscape.