Hancock Whitney Corporation

You should keep in mind that any forward-looking statements made by Hancock Whitney speak only as of the date on which they were made. As everyone understands, the current economic environment is rapidly evolving and changing. Hancock Whitney's ability to accurately project results or predict the effects of future plans or strategies or predict market or economic developments is inherently limited. We believe that the expectations reflected or implied by any forward-looking statements are based on reasonable assumptions, but are not guarantees of performance or results. And our actual results and performance could differ materially from those set forth in our forward-looking statements. Hancock Whitney undertakes no obligation to update or revise any forward-looking statements, and you are cautioned not to place undue reliance on such forward-looking statements. Some of the remarks contain non-GAAP financial measures, you can find reconciliations to the most comparable GAAP measures in our earnings release and financial tables. The presentation slides included in our 8K are also posted with the conference call webcast link on the Investor Relations website. We will reference some of these slides in today's call. Participating in today's call are John Harriston, President and CEO, Mike Ackery, CFO, and Chris Saluca, Chief Credit Officer. I will now turn the call over to John Harriston.

Thank you all for joining us on a busy reporting day. The second quarter of 2025 was another strong quarter. The results reflect our continued focus on profitability, efficiency, and meaningful progress in our multi-year growth plan. Our NIM expanded six basis points and we achieved an ROA of 1.37% after adjusting for expenses related to our transaction with Sable Trust Company, which closed on May 2nd. As expected, loans grew 364 million or 6% annualized you to stronger demand, increased line utilization, and lower payoffs. We remain focused on more granular, full relationship loans with the goal of achieving more favorable loan yields and relationship revenue. Our guidance on loan growth remains unchanged. We expect low single-digit growth for the year 2025, which infers mid-single-digit growth for the second half of 2025. Deposits were down $148 million, reflecting a decrease in CDs due to maturity concentration and promotional rate reductions in the quarter, along with a decrease in public funds. However, interest-bearing transaction balances and DDA balances were up in the quarter, and DDA mix actually increased to 37%. NEM continued to expand as our average earning assets grew at higher yields, and we continued to reduce deposit costs. Our fee income grew again this year, with trust fees driving most of the growth thanks to the additional team and client book from Sable. Expenses remain controlled and in line with our expectations, reflecting investments we are making in new revenue producers and technology efforts to improve efficiency and client experience. During the quarter, we continued to return capital to investors by repurchasing 750,000 shares of Common. We also deployed capital through the execution of our acquisition of Sable Trust, Our capital ratios, despite all that, remain very solid with TCE of 9.84% and common equity tier one ratio of 14.03%. We made meaningful progress on our organic growth plan this quarter. We added 10 net new bankers to the team during the quarter and it solidified the location of five new financial center locations for the Dallas market. We expect three of these financial centers to open in the back half of 25 and the remaining two will open in the first half of 26. We will provide additional guidance on new offices and bankers on the January call. We remain very optimistic for our growth prospects for the rest of the year. The macroeconomic environment remains dynamic, but our ample liquidity, solid allowance for credit losses at 1.45%, and strong capital keep us well positioned to navigate challenges and support our clients in any economy. Before we continue the call, I want to take a moment to acknowledge the devastating floods that have impacted communities across Texas. Our thoughts are with all those affected. We are no strangers to the hardships that natural disasters can bring, and we're committed to supporting recovery efforts across the region. As always, we stand ready to serve our communities with the same strength and resilience that define both our company and the people we are proud to serve. With that, I'll invite Mike to add additional comments.

Thanks, John. Good afternoon, everyone. As John mentioned, our results reflect another quarter of outstanding performance. our adjusted net income for the quarter was $118 million, or $1.37 per share, compared to $120 million, or $1.38 per share, in the first quarter. Second quarter results included $6 million of supplemental disclosure items related to our acquisition of Sable Trust Company in May of this year. PPNR was up 5 million, or 3%, from last quarter, and was a peer-leading 1.95% of assets. Our NIM again expanded this quarter, but by six basis points, and NII was up $7 million, or 2%. Fee income was up $4 million, or 4%, and expenses adjusted for one-time items remained well-controlled and were up $5 million, or just 2%. Our efficiency ratio improved to 54.91%, this quarter compared to 55.22% last quarter. The NIM expansion was driven by higher average earning asset volumes and yields and lower deposit costs, which were only partially offset by an unfavorable mix related to other borrowed funds. That's all shown on slide 15 of the investor deck. Bond yields were up eight basis points to 2.86%. We hit $233 million of principal cash flow at 3.15%, while we reinvested $359 million into the bond portfolio at 4.71%. Additionally, another $40 million of our fair value hedges became effective this quarter and contributed three basis points to the overall yield pickup. Next quarter, we expect about $152 million of principal cash flow at 3.11% that will be reinvested at higher yields. We expect the portfolio yield should continue to increase as we reinvest principal cash flows at higher rates. Our loan yield for the quarter was up two basis points to 5.86%. Yields on fixed rate loans were up 13 basis points to 5.17%. while yields on variable rate loans were down only two basis points. With no rate cuts expected in the third quarter of 25, we expect the overall loan yield to again be largely flat. Our overall cost of funds was down two basis points to 1.57% due to a lower cost of deposits and less favorable borrowing mix, as other borrowings increased compared to the prior quarter. The downward trend in our cost of deposits continued with a decrease of five basis points to 1.65% in the second quarter. The drivers here were CD maturities and renewals at lower rates. We expect the cost of deposits will be down marginally in the third quarter with an additional reduction in the fourth quarter, assuming the Fed cuts rates in September. For the quarter, we had 2.5 billion of CD maturities that matured at 3.85% and were repriced at 3.59%, with a strong 86% renewal rate. Additionally, our DDA balances increased again this quarter, up $24 million. Our NIB mix was also up this quarter to 37%. CDs will continue to reprice lower for the rest of 2025, given maturity volume and anticipated rate cuts. Total end-of-period deposits were down 148 million, mostly reflecting the impact of this quarter's CD repricing and other aspects of seasonality. We updated our guidance to reflect our current assumption of two rate cuts of 25 basis points in September and December, but with minimal impact. We expect modest NIM expansion in the second half of 25 and NII growth of between 3 and 4 percent for the year. There's no change to our PPNR or efficiency ratio guidance. Our criticized commercial loans decreased 4 percent to 594 million, and non-accrual loans decreased 9 percent to 95 million. Net charge-offs were up this quarter and came in at 31 basis points. Our loan portfolio is diverse, and we see no significant weakening in any specific portfolio sector or geography. Our loan reserves are solid, again, at 1.45 percent of loans, down four basis points from last quarter. We expect net charge-offs to average loans will come in at between 15 and 25 basis points for the full year 2025. Lastly, a comment on capital. Our capital ratios remain remarkably strong. We deployed capital this quarter through our acquisition of Sable Trust Company and a higher level of share repurchases. We more than doubled the buyback this quarter and bought back 750,000 shares. We expect share repurchases will continue at this level for the foreseeable future. Changes in the growth dynamics of our balance sheet, economic conditions, and share valuation could impact that view. I will now turn the call back to John.