Hancock Whitney Corporation - 6 (HWC) 20 Jul 222022 Q2 Earnings call transcript

Company Profile

Participants

Trisha Carlson	Investor Relations Manager
John Hairston	President and Chief Executive Officer
Michael Achary	Chief Financial Officer
Christopher Ziluca	Chief Credit Officer
Kevin Fitzsimmons	D. A. Davidson
Brett Rabatin	Hovde Group
Jennifer Demba	Truist Securities
Casey Haire	Jefferies
Brad Milsaps	Piper Sandler
Michael Rose	Raymond James
Catherine Mealor	KBW
Christopher Marinac	Janney Montgomery
Matt Olney	Stephens Inc

Call transcript

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Operator

Good day, ladies and gentlemen, and welcome to Hancock Whitney Corporation's Second Quarter 2022 Earnings Conference Call. At this time, all participants are in a listen-only mode. Later we will conduct a question-and-answer session and instructions will follow at that time.

As a reminder, this call may be recorded. I will now like to introduce your host for today's conference, Trisha Carlson, Investor Relations Manager.

begin. may You

Trisha Carlson

good and Thank afternoon. you,

with During today's risk company's would harbor most forward-looking and and published We recent XX-K including identified may to we language and remind the the was safe uncertainties make like the everyone statements. review therein. release XX-Q, call, to in earnings the and that presentation carefully

made. the You Whitney speak Hancock statements made date which should on by keep in mind that they were as any of forward-looking only

of is rapidly predict Hancock As and are the on future forward-looking set statements. everyone obligation inherently from economic environment believe undertakes materially the accurately place market performance or understands results, Whitney's limited. Hancock results but plans could and not predict such that any cautioned statements. and to those to statements is expectations undue results the and or evolving are assumptions, any ability not reliance economic or to forward-looking forward-looking our Whitney current changing. of developments performance on our reflected or based or forward-looking We actual by reasonable or or project statements, revise you differ are update strategies, effects no forth in guarantees implied

measures. Some the contain of Non-GAAP remarks financial

the also the with our comparable tables. are webcast in in the can financial find You conference reconciliations to Relations release posted on earnings included link X-K most Investor our and GAAP measures The slides call website. presentation

Officer. now Participating the today's President CEO, and John and We to Chief Chris CFO, will these Hairston, I John turn reference call Mike are today's will of over in Credit in some call Hairston. slides Achary, call. Ziluca,

John Hairston

we've another The reflects environment. a everyone few and us uncertain for Trisha, and today company we momentum to thanks agree solid discuss the joining positioned well today's you continues quarters Thank for past hope to quarter. reported you,

ahead of earning X% served of rate lagged. our more targeted million, movement the expected ratio quarter's plan. the and PPP well upward in rates back coupled our repriced XX% showing annualized utilization, all beat our deposit our Also this migration than growth production as as geographic exceeded with efficiency over offsetting estate run $XXX helped of across assets and markets in in off tailwind betas line us the Improving as XX% expected, a and quarter loan a pushed As quarter Core footprint contributors expectations all this real loans. healthcare, to These mortgage. strong growth. linked in were over NIM

across growth guidance almost Mississippi. are to of in from prior the with $XXX We range. bankers were expect that Texas by in rate quarter's the and XQ, high-end a followed second rebound strong Dallas with for Even we the million moderation a San expansion particularly X%, continued pleased to In we Beaumont, clear Jackson especially the year QX. X% however of and report to but and markets our Antonio bias quarter pipeline a at in the pull-through in and footprint

net despite our the on higher cash reported recovery charge-offs public of where clients were a DDA there of being money mix portion historically taxes rates. almost in use actually half converting was again levels capital half in increasing and deposit and relatively the Credit rates. That and a were last some continued no saw to declined deposits into best-in-class change and low-cost quarter. improving once NPLs of criticized quarter. for a we to opted The at X% liquidity off. commercial balance categories. We with migration down their elsewhere onto and in low pursuit loans in other and seasonal drivers paying moving consumer was run clients reductions light in pay sheet from normal debt So working excess funds

I the of further result rationale we performance, observe to positioned case. at you earnings believe deck that for the today's that a we are in comments. X.XX%. share comments to environment. With Mike Slide I'll our with my well refer finished this ask for saying strong a I'll quarter would we begin allowance to As XX any

Michael Achary

Thanks, John. Good afternoon, everyone.

a was quarter $XXX to mostly provision The with to from slightly of net $X.XX of our a release increased second we EPS income share for year million quarter reserve lower The earnings complete down linked as $X.XX results Compared per negative losses quarter another per share. tapering. loan per solid $X due and were ago, to a share.

higher our beneficial and our efficient positioned themes environment. floors our linked overall up pre-provision today's up uncertain X% $X.X well reset, $XXX to the yields, in $XX.X PPNR net per X% last Operating second loans costs. and million a the year. of in moving expenses, of sheet the initiatives initiatives releases $X.XX as and new assets share lagged balance The ago rates to million were execution in up. higher or included Those The of rates, at revenue end and have included costs reminder, quarter items and impact was earlier. operating the mainly $XX.X year the become or drove year to we quarter. for results more loans earning quarter on reserve operating a helped non-operating majority of deposit Three company successful the a securities to repriced, net or due related movement efficiency up think As added the or us same we personnel totaled million, challenging undertook we results and higher those from much of million increased

our bond shifted the as fund and also liquidity in excess portfolio invest loans, deposit mix to we used runoff. grow We assets earning in

majority called remaining federal during home advances the the were our quarter. of addition, loan In

in the net NIM quarter balance earnings within deck X.XX%. results and NIM shift the Also provides a impacting for quarter expectation As the better the is and this important a how moves for and to around indication NIM is begin third for expectations June's important additional our sheet Even in information Slides XX XX that is July Please our XX, of today. result activity, second income our and points of NIM. on basis to quarter's to widened at second X, rate of mix XX X.XX%. note this should refer more guidance X.XX% future that our interest

asset levels. metrics were quarter Our and down levels of quality again improved to loans this low criticized with commercial historically NPLs slightly

loans very at In ACL addition, XXX,XXX we PPP. X.XX% strong of excluding our saw a million and net recoveries $XXX of or remained

for we this are few low to result, ongoing quarters next our and or a of pessimistic. releases. Expectations likely million zero did have become end reserve the be levels model believe scenarios of that we $X.X quarter As as the we now are seen released more reserves provision

higher Another driver quarter for was the expenses. operating

$X almost While were stable, most expense expense personnel categories increased million.

XX, offset our vacancies commercial to than $X.X first pressures. improvement Consumer earlier has our increase first headcount and the comments the internship than have and and our and us to for expectations with more a and related banking, total in moves for while raise this NII fees reflected finally expected, there the of half guidance. in year. for that in resulting And the an the year remainder to quarter's which to and line salary the near-term ratio are of added to Slide merit Slide the million is on from The an primarily performance of this noted million base in program. both target is of XX.XX% the past is seasonality half impact expenses in a filling solid important meeting Incentive to quarter wages our technology $X.X increases annual capital. were average another in NIM rates been item higher increases X.XX% in guidance the efficiency individual we $X.X for are and corporate Bank some of the on As This Also also year. as additional year April. It's company in note totals. of $X inflationary up, the quarter this finally, updates due XX in paid million by and increased couple second million takes XX closing increase increased to rate pay and the reflect related FTEs increase, day

X Our did to points TCE while increase again impacted X.XX%. by basis OCI

solid quarter that I'll With remain up Again linked to leverage quarter. very call estimated XX points today's be with the that's XX% over helped solid to John. levels to environment. capital for Our and turn position a basis CETX back well us

John Hairston

Thanks, Mike.

Let's open the call for questions.

Operator

you. A. from with Thank is the Instructions] The question line [Operator Fitzsimmons first Davidson. Kevin of D.

Your line open. is now

Kevin Fitzsimmons

Good afternoon, Hi. everyone.

John Hairston

Kevin. Hi,

Kevin Fitzsimmons

of sheet, about guys it And on And liquidity brought past while margin your if earlier few that that's the specifically excess John now related declines seen it you up banks already. that reversing? by And And ability you we -- -- from percentage and wondering that? the expect, I growth NII just thoughts seems to had balance are and you NII maybe that's driven been we've some this looking but not even give know topic? address average you do guidance limited relatively assets not that on earning but if so you what driven being kind I'm cash is specifically NII, by by drawn confident can don't what just we've has by years deposit grow like are curious characterizing you the to margin feel you NII if can the grow the down? can right at and Just that hurt Thanks. if

Michael Achary

Mike. is the I'll add question John right. some have yes, and this start can that I Hi, answering Yes. color. you think Kevin, certainly Buy

really what of of you kind look is guidance for point to expecting for from to at slightly if year, this our year-over-year down. deposits So the be we're flat rest the

a asset the growth called year, last Now fact over deposits be second lot in our the likely still now, expecting in net-net the of end that loan bit to And not advances of the month. down that probably the of so from are we of the have they of implies year. at this will second home where earning half be a for the course half of

expect back through guide high the far you So of we go, the is the things deposits additional year, go to that again, to the really continue down. we we and second widen, happening. NII to deposit have of are higher see those half be NIM as to with half around slightly for could But year. really in grow absolutely the as of certainly for rates continue to some And so the to the tailwind flat deleveraging as confidence

we're that's respect kind year second the the of about and to NIM. of NII So half the with how thinking

John Hairston

is this John. Kevin,

to of vehicle point it to forward other without The are deploy At pretty the add deposits. and franchise commercial grow time The a same that. very franchise is the I close doing no this for dollar. lack to good from would at is, thing there to it, retail capacity dollar

purpose the in more for letting I and of us net now versus loan a of ease up moderately the a bit than little think -- ratio it's terms important is liquidity. currently excessive the grossly bit earnings interest deposit to income little excessive overall bolstering

not a So that leading capacity, it's really balance really posture. drives that sheet just to management

Michael Achary

the last absolutely it's the that base, deposit as a thing environment. just tremendous. then mix holding see And And would reminder through mix favorable ourselves of onto our add this we certainly I is go around we

Kevin Fitzsimmons

of for Yes. shrinkage liquidity talking quite that about time. that the it's main listen we've And about been because a -- headwind as is ironic problem, I'm talking that excess some

thing. thought. likely quickly off be wondering may does happened should deposit quicker or forward lag as I but good otherwise does just it it does just Does I'm on had? it. So that to or you What more But it dovetail has at seen And take than guys, have accelerate that if banks wondering so going you than too? secure might least just that a not particular, that they pricing -- all just that, about and be in deposit purchases do beta away

John Hairston

Yes.

quickly portfolio, terms I So be likely the just of in base I around pretty second first of of for all to of we the if and the think liquidity earning of excess composition question played part not of excess kind traditional how having notion right managing the you're has year. that's we're of the deployed kind our And of about bond this out. asset the to in half mean, really sheet, back second ways liquidity. balance the mean, that most

loan focus probably for have the So to where a from And now. going year. continued as we at second the looking additional as on with most concerned, of portfolio, will the question betas. far see how the the portfolio little off is But our is in we bond it loan around right I they're net don't lot bond And growth be that's I certainly is pretty now. guidance of we're think half book. growth growing bit now. year banks in second the right you'll think your low for a for first it of starting least Yes, at deposit then the half And grow

are I if at think we of, that, way going that's the philosophy deposit go expected. around, most I pick But following a betas. the year same kind to Federal controlled rates of through of as banks especially back think half as raises and up that certainly Reserve the looking

think play So towards I but the we'll that more certainly probably will fourth see. out quarter,

Kevin Fitzsimmons

just great. just at third can fourth to the you one some but curious it’s growth, if a quick but add quarter? just moderate loan I'm Okay, And quarter, assuming on was little the in why kind expected question rebound you Thanks. seasonality, then I of there? in

John Hairston

very quarter is was was the geographies it the both and scaling was better in the was as obviously second rate driver than pull-through primary quarter The very go Kevin. the diverse, spread there, across seasonality little specialties early a and we of through pipeline second it and growth expected. we good, -- is it the There was

So news. good it all was

As happened another that were for June increase got in we the XX worked XX into our July. increases the modeling bps price especially modeling and

in rippled suggesting. that we lagging sharp to if for several in pipeline the that reason given similar to looks assume to going moderation lending, models something pricing the what our we rate for And rate you fixed in just of such the the And last when terms XX pretty the adjusting work more beginning happen for now. that So August, for pricing XQ. that they're beginning just I days in we pipeline pretty a what's terms and deals significantly through I reflects as bids only for appraisal saw as right? day So mean, like what a close we're in requires average say rate do competitors of saw June fixed guidance see fixed we're the now, really are June, reduction

And So normal for QX. the pipeline scheduled some on a for in we it the hole of that side also of CRE downs are pay have pay XQ. has middle downs projects the scheduled

a of it's little bit So seasonality.

the at get rather the than our time terms that assumption XX fact a or dealing maybe then more point is it and growth. of months just in of in Some any pricing another with sheer of model in following even bps. we're quarter with pricing have and this two properly And bulk we'd the priced

So lack it isn’t isn’t a sentiment take down, it a of demand.

bubble. at a I I like weeks and that's eight think six lasted it six It what's so happen going really to about or was And and this gap. to think just historically about pricing will a that takes looks weeks that time.

Kevin Fitzsimmons

great. Okay, you, everyone. Thank

Michael Achary

you the for Thank bet. questions. You

Operator

with Thank line you next question your for the is question. Rabatin from Brett of Hovde The Group.

now Your is line open.

Brett Rabatin

Hey, good afternoon, everyone.

John Hairston

afternoon, Good Brett.

Brett Rabatin

the to from I kind guidance appreciate X.XX% mentioned Wanted the deposit makes and to to about of July, just the progression math the sense. Wanted margin you little -- of betas here a bit. talk for

As betas. expect do deposit at how hikes loan margin betas the migration what here, six betas of betas talk about the Can accelerate, the months? to fast the upward the in the you about to we start deposit think you slow and the deposit i.e, from you rate the that remaining next point will think

Michael Achary

comments question. Mike. is few Hey, you give Brett. to that related a This I'll

I maybe in potential Fed and of the month, overall the then not a slower continue what's think and as to NIM, November trajectory December. the So at this and to happen, happened September end we only with at for rate what's of into rates related increasing the move just to the but given likely

anticipating expansion year. see we're that majority half the second the for of we'll the of margin the think I

we'll I third I things we see to see but that I suggest fourth Not of the the believe quarter. in in think that quarter. most think will, equal. won't any all we

quarter, half see, the We impact the be in there part third the the to the last say quarter. to impact I Not we to won't going also will third it of deposit again the I toward impact that probably be begin is we year think full weighted at most second some as get the in of more year. think believe see time fourth by of look to the betas. but quarter, the that of and I think we'll

So hopefully that's helpful.

Brett Rabatin

in -- just seem migrate could helpful. like that's that. Yes, even for then ratio different below here the And it any year? want wanted have the guidance and a very of Appreciate would guidance why revenue Mike, on months expenses the that's and on where based talk about it you the XX%, towards reason there to didn't give efficiency to trends kind terms efficiency Is but staying ratio guidance in of six it for from XX%. to it you next a

Michael Achary

the just XX specific ratio No. gave level number math that all. reason given like the down above suggested. felt would guidance detail you efficiency that we Slide No to We the that at take that of on certainly the the

as really a out opposed So kind it given specifically calling just was of there.

Brett Rabatin

I'm maybe And great. Okay, just. then go ahead, sorry, John.

John Hairston

I last sorry, around is earlier the as timing. Page The what bullet go might point on looking the that XX stepped bottom the of just in that NIM you, up in increases be expansion you question I'm are for one Brett.

think point. into that can you're where with headed back So you I bullet

Brett Rabatin

all. -- said on assumption Page what Well just figure I was Everything beta, XX you helpful. that very have Okay. to deposit to I for the was that's was the guess, what trying was guys trying figure John, out so

terms the opportunity last recession might was do are happens 'XX? lack for respond in talking share in recession thinking market you what you in thereof? How everyone And movement about or growth for How growth quickly or assuming recession? Just mean and in to we lack and that a our sheets of thereof? think what balance that is just you thinking about guys about a are

John Hairston

places question Yes. I'll a but who begin wants could anybody else and that around that's the I'll and go to. few different table, start great in a chime can

In that the on ourself Page terms time, of of growth find XX the this position, our appetite, we deck. given sort outlined point in and we of at

Our offensive out lot talent there. there's hiring, a of our posture is continue, to good

leadership. a treasury We the between line and function have the synchronicity terrific

to success with to have four I last the and leadership. line We the some appreciate experience, have they dialog in we really joined the that. credit that's the good six have great between quarters. of And observation as that And incoming led bankers with organization synchronicity of people think

us, with that also in so And that offense and we'll front success behind continue doing presume hiring changes. would we we until us it's of -- of something and till

there's for if further So think we an I and went I looking us environment, disruption pretty that deposit that any loans. probably think recessive a then also that the that growth. at environment gathering we're in losers a there and that hiring we to would provide don't is always slows, opportunity in would winners extent into environment And still recessive generate would people if hard around

you'd in a from we loans. low think cycle, go reserve been different have it's cycles. and any of one nice be if don't position credit prior levels than loan very and loss It's NPL an I the to a into with of So the strength

good in with strong a got we good start to a reserve. So off place

rolled respond deposit with to And would the doing we together, we keep will is book. exactly what protect we're the all exception doing that today I so with think

relationships up see future. on looking ensure climb we'd Did or clarity? some I we what we as would in core So like answer more to you those the were to begin at you betas hold

Brett Rabatin

helpful the really all No, I that's color. John. appreciate

John Hairston

for the Thanks question. You bet.

Operator

question the you Securities. Demba of The from your next Thank Jennifer Truist is line with for question.

open. now is line Your

Jennifer Demba

Thank afternoon. you. Good

left point, your appetite. X.X the repurchase about I million this got you authorization? shares on Just curious know on share At

Michael Achary

than Mike, our will described bought given disruption, I in certainly year. opportunity Yes, Jennifer. is market shares more always the that appetite level opportunistic. But And kind so. we saw We've think is the that second absolutely being the to we This expected. probably so the in of half of we amount and second continue admittedly quarter do maybe of

in the will So year. continue second the to opportunistic of be half we

we that Just maybe not back the in quarter. second the bought at shares same level

Jennifer Demba

Okay, Are a topic particular opportunities relatively markets right more on And back any thanks. just for the you're now? hiring second. there where seeing

Michael Achary

question, good a Jennifer. That's

book really growth can is And area on Louisiana, where in hired half the extent Our teams are quarter, just noticed here focus teams, were and higher. as the find different growth people in particularly is we rate footprint to and markets little we'd that we about were the of of growth But Mississippi, the really company opportunistic we the of is that hire half and and like in more take were hires. the areas individuals advantage you organic in those about the folks the To because the natural of core simply, there that. last with the markets. Alabama the the people mix a added in folks expected

low it's will to where time So have very growth by I very hires opportunity. so the going be good market would markets or year's view, say but high of those probably one you we XX% be share, probably at look in

Jennifer Demba

you. Thank

Michael Achary

Thanks Yes, ma'am. the question. for

Operator

for your you is the Haire of The next line with question. Thank Casey from Jefferies. question

Your line now open. is

Casey Haire

afternoon, Hi. Yes, thanks. everyone. Good

deposit guys to How Fed is book. fund So kind bond book If out looking in a small the question a what are willing how like at you to guys you size add out balance a tough I you balance growth loan fund going on -- you there to decent forward. know tightening -- that that of sheet? percentage that is to run portfolio opportunity of If of -- willing much guess of remains deposit the of the as growth XX% that sheet. bond an there know growth are how -- have I of the cycle

Michael Achary

Casey, Mike. this is

probably high Admittedly is a the assets. probably low end. of XX% as run portfolio we’ve maybe XX% the bond on XX% to as So earning

of I look is bond intent kind on around where probably would at of that to Our year say modestly the the half the are so. Those giving sweet now. it second from now is just spot right book, or we parameters. broad grow how is again the XX% based But

So that's we about of kind how that. think

Casey Haire

less And indirect portfolio? less on amortizing, is is understood. demand both? or on just that the Okay, just how big appetite or part of book, which a combination that then is your due to And

Michael Achary

Casey was -- for exited running I it believe at million we there's down is ago. quarter new with off year $XXX a $XX it been two six, less it's -- exited three a the in of think in become that's business the It's handle at the and last, in quarters probably production I more about started quarters or maybe is -- amortization million eight going now a to that immaterial. and the book

a that cycle opted didn't seeing prices, In we terms look many went other and we that begin of into And and and to were liquidity per to that features into instrument risk purposes. use saw to us credit returns strategy, up higher mean, terribly the we note. getting principal skinny if attractive built for out losses get so we different coming the the I were of what adjusted too

it's So that's the reason amortizing.

Casey Haire

Got you. Thank you.

Michael Achary

bet. Thanks You for the question.

Operator

you next your from Sandler. The Milsaps Thank Brad of Piper with question is the question. line for

is open. Your line now

Brad Milsaps

evening. good Hey,

Michael Achary

Hi, Brad.

Brad Milsaps

bond to I follow wanted Mike, on just up Casey's question.

of look ability that well that not range? buying just there think is you're of kind yield doing relatively in curious comment but this lift it quarter linked that sort stuck see Just to lot some stayed reinvesting the we or could flat as of the there maybe on some new, you a like that

Michael Achary

maturities think up the that No. I basis bond points we yield Brad. but came so stuck a Thanks X And very of to bonds contributed range, nice did million, million downs. no on well very, yield. pay reinvested The at don't in question, as about we're that that We quarter-over-quarter. on portfolio buy $XXX $XXX bonds for growth, obviously was the bought the or certainly any new the as

those I later a quarter. of issue lot to the of happen part purchases the tended in is think

was second muted. a little bit impact the So in the quarter

bit in quarter. I a think significant a coming of you'll yield the see little more pickup

Brad Milsaps

beta beta on discussion. any cycle, there saw a as think then this helpful. Great. a Is XX% loan a follow-up wouldn't cycle. reason sort you Very see just you And loan last would you of the

rate or can quickly. of you it think saw you Just achieve Do the along last some same difficult are time way around? think sort of competed away or pass mind in to that you so increases coming you be will beta your that the

Michael Achary

match. loan have Yes, break right book, is now it last no were any time intent cycle our in loan The the we absolutely, that on would a be and to when beta we to our really different. reason believe have

far obviously that so And proving our out, experience early. but we're is

Brad Milsaps

guys discuss Sure would that. of great? you additional think puts stay color fees kind kind color are coming the you. of just I It a Thank Do final from of little things And couple have of the But There prep sort kind guidance went maybe the fees from curious any flat would just seasonal for back some lift one offset is imply fees, one me. for coming you takes and down. a there the thank trust, Can of you of you maybe kind on there of tax here. a lot quarterly fees that? and be the assume on seasonal trust that this quarter. to trust other way. just looks like

John Hairston

and Great to in bounce little Yes. a QX. outsized that the down, observation, expect that back number thanks trust Yes, and the was account services quarter. had pretty third cards, we for but The all question. in would business investments, performance

ought the will see is was that fees we categories a think amount that to just be better. put I planning business and amount trust think and in little tax bit services see seasonal then more maybe unless think we we take, that account from I a down So would the be probably or up by the

fourth much challenged for because think I It The of the X%. a will think only environment. secondary I So over of is more It's simply little they the category quarter or there activity. little differently. the in in rates really Not quarter, that that's how a a mortgage delivered a overall on with really we're third bit what side observation selling. be accurate. lack secondary muted being just your of are interest It's just terms

Brad Milsaps

guys. color. you, Thank Appreciate all Great. the

Operator

The Thank line with you your question. the Raymond Michael James. for next is of from question Rose

is now open. line Your

Michael Rose

afternoon, taking good my everyone. questions. for Thanks Hey,

classified Just ones, are on of quick pause. sort to past you stable four know getting have I pickup give point? the a near-term trouble now. guys in Losses done the see you any scaling years to of levels two charge-off of in just quarters. signs so a have that on ago. would trending that on sort been we credit, right low the energy really gave this NPAs least you de-risking, lower. really out lot at that back a Any substantially Thanks. pretty things think Any consumer of would at the down criticized, horizon of reason couple good are

Christopher Ziluca

they of indicators it's hard be to Michael asset in , at point -- at we're kind a inflationary future. on And Hi, get Chris essentially a Obviously, perspective, time, don't a to done in level And not. imagine customers. environment charge-off on don't because from I really it's diligence Yes, exactly starts portfolio. depends recession at just to I bottom. really quality. a take time, But supply to individual from issues we Ziluca. due a historical think, impact the our as very that But a then hold point it's or of lot in tend how on going balancing or current see we're the not this our perspective low we've lagging of whether Yes. lower this to on lot obviously just really also that the and relates a it and it immediate really lot pressures chain

what's to a of exactly place individual customers on surveil routines with and going with segment. lot in our have We

confident them with to deal being able So the issues in we're and at identify process. feeling least earlier

Michael Rose

That's then read And do know typically to see one me, at one if rate anything could cuts. the increases didn't there to include mean, wanted increases? helpful. if the is was just Thanks. Maybe obviously some that into just annually. three-year that know not quarter. some you final just in those you look to deck for there I around rate we footnote update those the future Any do including on futures rate curve, I not targets I in not confirm the plans this expectation is CSOs, slide it that

Michael Achary

not is rates. the as CSO, this that continue on Yes. as they around correct, you're to And we include CSO assumptions Michael, higher Yes, those far the basis. confirm annual you updating I'll Mike. an update any for typically

So you'll the after earnings release fourth update an we when certainly quarter. see

Michael Rose

Okay, taking Thanks questions. great. my for

Michael Achary

Okay.

John Hairston

you. Thank

Operator

Mealor question. line next of Thank from you the your Catherine for KBW. is question with The

now Your line is open.

Catherine Mealor

evening, Thanks. everyone. Good

John Hairston

Catherine, how you? are

Catherine Mealor

question of balance the follow-up sheet. My Good. on size just the

think to up going you year-over-year. that is XX% PPNR gave to be You XX% guidance

fees back the so different got We've we've I lot as We've the -- growth. loan a of of kind gotten think think about in we've going got I half And where components and margins that, expenses. got of of the year.

the So missing size one I think the is piece maybe sheet. the that just of balance of

a significant fair being decline but relatively within we're so PPNR keeping a securities your to in portfolio pretty kind then liquidity. that it flat. is And guide, And -- baked into assume excess year-end, of the that will is, I it you a a is excess liquidity hit that kind is the by of, guidance? there there level guess Is think and question

Michael Achary

is this Mike. Catherine, Yes,

So that of liquidity, where excess the the kind at as I that we've point balance ways kind all benefit into mean quarter. more I the managing before, really traditional we're think of sheet. the And going had we of do I the of to return mentioned without by

and in $XXX deployed was billion ended better with this So we million lot bunch loans. quarter. started just with part a of We growing course liquidity terms that $X.X under of deployed of a that the excess of of

we grow we home were the book, We part quarter. loan to called advances during funded then the $X of of continue our And billion better outflows. had deposit the bond

I So how brought just that the at absolutely of the to us and the I think forward then and is at of that you there makes sense the level with mentioned really articulated, assumptions June consistent kind XXth looking going broad we're year. second half from

think the the course quarter of fashion kind in a the more year. over So be funds next sheet again level largely with of the I some operates the end think of balance the will point and gone of excess I borrowed by at that probably traditional potentially liquidity

Catherine Mealor

yields were the we about then margin, for And helpful. June? what if June think of the That's month Great. loan

Michael Achary

month it around the I of X.XX%, kind month shows the of in June certainly of or again quarter, continued expecting was the think as margin what at that with for information we don't I me have and the well gave X.XX% expansion, the as we're July and so.

Catherine Mealor

in Okay, versus excess of XQ to of guess to loan a I got impact just it. trying into have is with And line, deducted the coming full figure then quarter? that yields. X.XX% securities how from we're what's quarter's going the much this that backing two that's lot kind happening get assuming that And coming. of most liquidity of I'm have

Michael Achary

really, happened. hike after recently major know, a rate the resetting it you part is that of LIBOR Yes, big

Catherine Mealor

Okay.

else think I was there. you Thank much. Great so quarter. everything in

Michael Achary

Thank you.

Operator

the your Janney Thank Marinac Montgomery. you is with The question. next for line question from of Christopher

Your line is open. now

Christopher Marinac

Mike and the can where you Can about was the fed rate rate to get gets raising through evening. perhaps sort customers funds there of a all I the and you on what wanted fed the go ask today, stops expire or how Good take floors Thanks. once do where team floors back down? scenario environment rates started next X.XX%. to year us envision

John Hairston

amazing eight rights to great Yes. We're all of we're here space begin or our that just It’s It's the months rise. quarter. a about women floors in talking next really question. through contemplating way to being actually the six

out to can rapidly figure what had we've that's we do. actually So

weeks in kind conversations set that So into what's to clients with able so literally enough we're been having two into of or last XXXX. far we is the and haven't to far those floors, any an this get is reported but expectation three

to better able be not given early three when hard it rates a a So to it's I'll We of trying you conversation, answer able end get quarter. which to be couple this right a set where really that are, we give tell the now. of to too in probably to months to obviously are and

Christopher Marinac

you're question or quarters? and John, same between these to general think the just influence fair, few floating that you is do do a related guess I variable That's you presume perhaps mix mix would that able next be of and general the

John Hairston

question. good Another

see look so which Page but between and breakdown or I we that the variable the -- show page much you'll you much of is, remember quarters if rates how last how fixed fixed, shows can't is five seven at So the is the it deck, variable. is

mix highest the the second the numbers, our the of trend percentage the look time, happen. and so quarter The was book variable higher loans of a variable in if amount at was variable year of lower number rate this back percentage toward over fixed And we most been book probably history. percentage one modern of the that the certainly at are lowest a and you we as we've the that and highest

purposeful us as see was pretty you So by that and serving now NIM right well it's the expansion.

of I in we be forward, suspect, pricing to probably move third pipeline the the June the will pronounced back competitive that month mentioned down of probably go we quarter and a and terms then saw questions. And previous again As the I even average one of three. in more on effect it’ll we're given the in the earlier answering in quarter, fourth the

rate the with high in variable 'XX make at work. to like crystal who a much the get 'XX. then into that's where we marketing keeping hedge downside we hired of how the as we loans. bit we percentage organizations lot has that disrupted It So pretty ball and do progress and we on hired, But we'll of for risk and a some little

Christopher Marinac

of stay I come Mike for that number buybacks down quick stable? quarters That's just can just that the on really caused helpful, that appreciate capital or level XX% and is CETX future and the you kind one Great. ratio. would growth imagine last to John. With

Michael Achary

as reason down the primarily. loans forward liquidity XX% our in go excess or the slightly Absolutely. it of risk was Believe that we second year. the really Really through traded can an as was keep we weighted assets increase half quarter-over-quarter higher that we level for

excess So ratio trade to won't the going where out, we'll given probably is absolutely answer going XX% that extent plus But you forward. at operate is we that have think liquidity probably same the to that question forward. played

Christopher Marinac

Good. the time Thank you all for very much today.

John Hairston

Thank you for bet. You questions. the

Operator

of line from Stephens next with Thank is question you The for the Olney question. Matt your Inc.

line is open. Your now

Matt Olney

to Yes, what thanks the for just you balances. us question. go and of deposit, Help deposit taking directionally good appreciate discussion. On you back deposits us expect. guidance the to on John, the gave want mix deposit I

that so years. to We'd deposits. I more two ago, of three improvement of of over levels? these the think NIBs few XX% we quite around current hear mix the the total love NIB go a now your balances If are XX%, about years was Thanks. back it maintaining or expectations last

John Hairston

mid correct capital Ida the start spent the in when jump the years think spend will the working ago or either Mike you think the of can and around invest around, is remnant is of called on that to and all of when bulk I with business out DDAs. in of other settle as expect table it is few enhancements I'll number operating and rate low-XX%. where used we and some add the Sure. in. money a see liquidity a Hurricane we and PPP bit Historically conceivable very we talk remnant to good would accounts do purposes. variable in or It loan that time, we continue be the that mix get At to to the along for the we that same

So love we reasonable as to move I XX.X% and mid-XX% forward. think but that not a something we a may expectation of at or that comments? target range, any stay four handle Mike is kind a to would

Michael Achary

Yes, I agree completely, John.

the not may I a XX% rate extraordinarily high higher is environment. think sustainable XX%, in and be

but down described they long come believe lot just think of on how when know in how XX% it's and in start probably range, all somewhere road, say rate we the days dynamics ran C&I and to don't certainly in when through the a depends go the down that little somewhere that book. had density that John I variable let's less before a we again, also rates are bit rate high XX%, and that done but the So and XX% cycle this to said we

a just we more had years in those those and bankers few ago. markets We clients have generate more more of and clients have markets and types to we

we in deposits And season. So makes to down to to the I'd the book. the cycle generate where normal that in we as in sense? the get be a the would before enhancements loan back more I all expect given that way were Does mix disappointed to change if we returned overall better up book the

Matt Olney

And that. on sense. makes that John follow-up Yes,

one mentioned expect you of insurance yet. see And more the seeing is out when of to move that you impact? do proceeds the proceeds You the not there. insurance if impacts Are

John Hairston

underway New of Is rooftop in so is get largely that too sense? in it devastation we the we damage years not and in in that was the geographic it as lower Those and of chunk where in that lower the we I is the the makes and call of liquidity to down out two hit storm the that buildings impact still is to a go and it far you gets of repaired three sort the year, will then and Louisiana and bulk flow a What for of real take another and thing that are -- thing. chunk half. probably the to period. tied the see really sort do Parish Jefferson parishes parishes, storm but proper already leads, more or say of Orleans XX-month would the in under Orleans the Homeland really destroyed that New of and that's year So spent of area it really

Matt Olney

Thank helpful. guys. you that's Okay,

John Hairston

Okay.

bet. Thank You you.

Operator

questions. no at your this There you waiting for Thank are additional questions time.

back So Hairston I'll closing remarks. conference John pass to for the

John Hairston

and a Thanks the in hope dialing road. the to Matthew on a after have call running day you terrific evening for seeing your the you and day. look for we to interest everyone in thanks forward long late and We

Operator

participation. for the Thank conference you your call. concludes That

You may your disconnect now lines.

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