What Led volatility in the stock: Hancock Whitney Corp (NASDAQ: HWC) stock slightly fell over 0.03% on 17th January, 2019 (Source: Google finance) after the company missed the analysts’ expectation for the fourth quarter of FY 18. Nonperforming assets (NPAs) totaled $352.6 million at December 31, 2018, down $38.7 million, or 10%, from September 30, 2018. During the fourth quarter of 2018, total nonperforming loans decreased approximately $37.5 million, while foreclosed and surplus real estate (ORE) and other foreclosed assets decreased approximately $1.2 million. Nonperforming assets as a percent of total loans, ORE and other foreclosed assets was 1.76% at December 31, 2018, down 24 bps from September 30, 2018. HWC in the fourth quarter of FY 18 has reported the adjusted earnings per share of $1.12, missing the analysts’ estimates for the adjusted earnings per share of $1.13. The company had reported the adjusted revenue of $292 million in the fourth quarter of FY 18, missing the analysts’ estimates for revenue of $294.8 million.
Other Financials Performance: Meanwhile, in late the fourth quarter the company sold 192,000 shares of VISA-B stock for a net gain of $33.2 million. The VISA-B shares net gain offset losses associated with selling $481 million of lower yielding bonds and $116 million of lower yielding municipal loans. Proceeds from the sales were used to purchase $260 million of higher yielding bonds and to pay down $346 million of FHLB advances. The VISA-B trade and related restructuring improves the company’s yields on investment securities and loans, while also improving the company’s funding mix.
Average earning assets were $26.0 billion for the fourth quarter of 2018, up $178.8 million, or less than 1%, from the third quarter of 2018. The net interest margin (TE) was 3.39% for the fourth quarter of 2018, up 3 bps from the third quarter of 2018. The increase in the margin reflects a positive impact from a 10 bp increase in the average earning asset yield (an 8 bp increase in loan yield and a 7 bp increase in yield on the securities portfolio), partially offset by a 7 bp increase in the cost of funds. The portfolio restructuring noted above added 2 bps to the margin, while changes in the funding mix also contributed positively.
Common shareholders’ equity at December 31, 2018 totaled $3.1 billion, up $102 million, or 3%, from third quarter 2018. The tangible common equity (TCE) ratio was 8.02%, up 35 bps from September 30, 2018. We repurchased 200,000 shares of common stock during the quarter