8-K 1 wtnyer04.txt WHITNEY EARNINGS RELEASE UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of report (Date of earliest event reported): April 21, 2004 ----------------------- WHITNEY HOLDING CORPORATION -------------------------------------------------------------------------------- (Exact name of registrant as specified in its charter) Louisiana 0-1026 72-6017893 -------------------------------------------------------------------------------- (State of (Commission File Number) (IRS Employer incorporation) Identification No.) 228 St. Charles Avenue, New Orleans, Louisiana 70130 -------------------------------------------------------------------------------- (Address of principal executive offices) (Zip Code) (504) 586-7272 -------------------------------------------------------------------------------- (Registrant's telephone number, including area code) Item 7. Financial Statements and Exhibits. (c) Exhibits 99.1 News Release dated April 21, 2004 Item 12. Results of Operations and Financial Condition On April 21, 2004, Whitney Holding Corporation issued a news release announcing its financial results for the quarter ended March 31, 2004 (the "News Release"). The News Release is attached as Exhibit 99.1 to this report. SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. WHITNEY HOLDING CORPORATION By: /s/Thomas L. Callicutt, Jr. ------------------------------------ Thomas L. Callicutt, Jr. Executive Vice President and Chief Financial Officer Date: April 21, 2004 ------------------------------ EXHIBIT INDEX Exhibit Number Description ---------- ------------------------------------ 99.1 News Release dated April 21, 2004 Exhibit 99.1 [LOGO] WHITNEY HOLDING CORPORATION 228 ST. CHARLES AVENUE NEW ORLEANS, LA 70130 www.whitneybank.com NEWS RELEASE CONTACT: Thomas L. Callicutt, Jr. FOR IMMEDIATE RELEASE 504/552-4591 April 21, 2004 WHITNEY REPORTS FIRST QUARTER 2004 EARNINGS New Orleans, Louisiana. Whitney Holding Corporation (NASDAQ-WTNY) earned $26.2 million for the quarter ended March 31, 2004, an 11% increase over net income of $23.5 million reported for the first quarter of 2003. Per share earnings were up 10%, to $.65 per basic share and $.64 per diluted share in 2004's first quarter from $.59 and $.58, respectively, in the year-earlier period. Selected highlights from the first quarter's results follow: o Growth in average earning assets spurred a $4.5 million, or 6%, increase in net interest income (TE) compared to the first quarter of 2003. The net interest margin (TE) was a healthy 4.40% for the first quarter of 2004, although there was moderate margin compression relative to the year-earlier period that partly offset the favorable impact of earning asset growth. The margin for the current quarter was down only slightly from 4.43% in the fourth quarter of 2003. Whitney's asset yields and funding costs have begun to stabilize after trending lower during a period of sustained low market interest rates. The overall yield on earning assets for the first quarter of 2004 was 46 basis points lower than in the year-earlier period, but was essentially level with the yield for the fourth quarter of 2003. Funding costs for the current year's first quarter were down 29 basis points compared to the first quarter of 2003, but were up slightly from 2003's fourth quarter, reflecting an increase in short-term borrowings accessed to partially fund growth in the loan and investment portfolios. o Improved credit quality during the first quarter of 2004 led to a $2 million negative provision for loan losses during the period. Whitney recorded no provision in 2003's - MORE - 2 fourth quarter and a provision of $.5 million in the first quarter of 2003. The total of loans criticized through the internal credit risk classification process at March 31, 2004 was down $11 million from year-end 2003, including a $1.7 million reduction in total nonperforming loans. The allowance required for impaired loans at March 31, 2004 was $.8 million below the level at December 31, 2003. These favorable developments helped reduce the allowance for loan losses at March 31, 2004 by $1.9 million from the level at December 31, 2003. There was a small net recovery of charge-offs in the first quarter of 2004, compared to net charge-offs of $1.9 million in the fourth quarter of 2003 and $.7 million in 2003's first quarter. The allowance represented 229% of nonperforming loans at the end of 2004's first quarter, little changed from year-end 2003. o Noninterest income decreased 3%, or $.6 million, from the first quarter of 2003. Though most major sources of noninterest income posted stable to higher results compared to the first quarter of 2003, fee income from Whitney's secondary mortgage market operations was down by $1.5 million. Home loan production, and refinancing activity in particular, began a marked slowdown toward the end of the third quarter of 2003 as mortgage rates trended higher. Income from bank-issued credit and debit cards was up 6% compared to 2003's first quarter. The percentage growth in card transaction volumes was higher, but the rates on debit transactions have been restructured and effectively lowered by Visa USA in response to pressure from major merchants. Trust service fees rose 7% compared to the first quarter of 2003 aided by new business opportunities and improved equity market valuations. Other noninterest income was up 11%, or $.6 million, including growth in investment service fees and credit-related fees, among other contributors. o Noninterest expense increased 5%, or $2.7 million, from 2003's first quarter. Personnel expense was up 5%, or $1.6 million, in total, with employee compensation up 3%, or $.7 million, and employee benefits higher by 13%, or $.9 million. The increase in employee compensation was consistent with the increase in base pay. A sharp reduction in commission-related pay, mainly from lower home loan production, was offset by higher stock-based compensation under the management incentive plan that was primarily driven by an increase in the value of Whitney's stock. An increase in the expense estimated for pension and retiree health benefits was the main factor behind the overall - MORE - 3 rise in employee benefits for the first quarter of 2004. The annual expense for these retirement benefits is expected to be up less than $1 million in the current year compared to 2003. Branch additions and enhancements to customer service capabilities contributed to moderate increases in expense for occupancy, equipment and data processing and telecommunications compared to the first quarter of 2003. The expense for legal and professional fees was lower in the first quarter of 2004, reflecting a benefit from favorable trends in credit quality, among other factors. An increase in marketing activities and the amortization of expanded affordable housing investments were the larger factors of a recurring nature behind the $1.4 million increase in other noninterest expense. Tax credits associated with the affordable housing investments helped lower the effective tax rate compared to the year-earlier period. Whitney's earning assets grew $625 million, or almost 10%, on average in the first quarter of 2004 compared to 2003's first quarter. Average loans in the first quarter of 2004 were up 10%, or $445 million, with growth in the commercial and commercial real estate portfolios accounting for virtually all of the increase. Commercial lending has yielded steady portfolio growth throughout 2003 and into 2004, with new customer development supplementing steady to rising demand from Whitney's well-established customer base. Average investment securities increased 14%, or $270 million, from the first quarter of 2003 to 2004's first quarter, as management executed a temporary strategy starting in late 2003 to invest in advance of paydowns expected in 2004. Growth in earning assets was supported by growth in deposits and additional short-term borrowings. Total lower-cost deposits in the first quarter of 2004 were on average 10%, or $417 million, higher than the year-earlier period, with noninterest-bearing demand deposits up 13% and deposits in lower-cost interest-bearing products up 8%. At the same time, higher-cost time deposits were down 4%, or $59 million, from 2003's first quarter, with some of these funds flowing to other lower-cost products. In total, average deposits were up 6%, or $358 million, in the first quarter of 2004 compared to 2003's first quarter, while borrowings rose 57%, or $252 million, on average. Whitney Holding Corporation, through its banking subsidiary Whitney National Bank, serves the five-state Gulf Coast region stretching from Houston, Texas; across southern Louisiana and the coastal region of Mississippi; to central and south Alabama; and into the panhandle of Florida. Additionally, Whitney has announced an agreement to acquire Madison BancShares, Inc. and its subsidiary, Madison Bank, which is located in the Tampa, Florida market. - MORE - 4 ----- This news release may contain statements that are not historical facts and are "forward-looking statements" within the meaning of section 27A of the Securities Act of 1933, as amended, and section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements, which Whitney makes in good faith, are based on numerous assumptions, certain of which we may refer to specifically in connection with a particular statement. Some of the more important assumptions include: o expectations about overall economic strength and the performance of the economies in Whitney's market area, o expectations about the movement of interest rates, including actions that may be taken by the Federal Reserve Board in response to changing economic conditions, o reliance on existing or anticipated changes in laws and regulations affecting the activities of the banking industry and other financial service providers, and o expectations regarding the nature and level of competition, changes in customer behavior and preferences, and Whitney's ability to execute its plans to respond effectively. Because it is uncertain whether future conditions and events will confirm these assumptions, there is a risk that Whitney's future results will differ materially from what is stated in or implied by such forward-looking statements. Whitney cautions readers to consider this risk. Whitney undertakes no obligation to update or revise any of the information in this news release, whether as a result of new information, future events or developments, or for any other reason. - MORE - 5
WHITNEY HOLDING CORPORATION AND SUBSIDIARIES FINANCIAL HIGHLIGHTS First First Quarter Quarter (dollars in thousands, except per share data) 2004 2003 ---------------------------------------------------------------------------------------------------------- INCOME DATA Net interest income $ 77,190 $ 72,794 Net interest income (tax-equivalent) 78,671 74,216 Provision for loan losses (2,000) 500 Noninterest income 20,907 21,495 Net securities gains (losses) in noninterest income - - Noninterest expense 62,026 59,294 Net income 26,158 23,470 ---------------------------------------------------------------------------------------------------------- AVERAGE BALANCE SHEET DATA Loans $4,906,710 $4,461,849 Investment securities 2,245,626 1,975,563 Earning assets 7,175,034 6,550,281 Total assets 7,722,135 7,074,196 Deposits 6,119,857 5,762,353 Shareholders' equity 855,476 811,347 ---------------------------------------------------------------------------------------------------------- PER SHARE DATA Earnings per share Basic $ .65 $ .59 Diluted .64 .58 Cash dividends per share $ .33 $ .30 Book value per share, end of period $ 21.48 $ 20.25 Trading data High price $ 44.00 $ 34.55 Low price 39.72 30.75 End-of-period closing price 41.74 34.20 Trading volume 3,488,599 6,344,880 ---------------------------------------------------------------------------------------------------------- RATIOS Return on average assets 1.36% 1.35% Return on average shareholders' equity 12.30 11.73 Net interest margin 4.40 4.57 Dividend payout ratio 51.20 51.29 Average loans as a percentage of average deposits 80.18 77.43 Efficiency ratio 62.29 61.95 Allowance for loan losses as a percentage of loans, at end of period 1.16 1.46 Nonperforming assets as a percentage of loans plus foreclosed assets and surplus property, at end of period .56 .98 Average shareholders' equity as a percentage of average total assets 11.08 11.47 Leverage ratio, at end of period 9.96 9.86 ---------------------------------------------------------------------------------------------------------- Tax-equivalent (TE) amounts are calculated using a federal income tax rate of 35%. The efficiency ratio is noninterest expense to total net interest (TE) and noninterest income (excluding securities transactions). -MORE-
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WHITNEY HOLDING CORPORATION AND SUBSIDIARIES DAILY AVERAGE CONSOLIDATED BALANCE SHEETS First First Quarter Quarter (dollars in thousands) 2004 2003 ------------------------------------------------------------------------------------------- ASSETS -------------------------------------------------------- EARNING ASSETS Loans $4,906,710 $4,461,849 Investment securities Securities available for sale 2,044,168 1,774,668 Securities held to maturity 201,458 200,895 ---------- ---------- Total investment securities 2,245,626 1,975,563 ---------- ---------- Federal funds sold and short-term investments 12,195 53,589 Loans held for sale 10,503 59,280 ---------- ---------- Total earning assets 7,175,034 6,550,281 ------------------------------------------------------------------------------------------- NONEARNING ASSETS Accrued interest receivable 29,867 30,642 Goodwill 69,164 69,164 Other intangible assets 22,805 28,066 Other assets 484,872 462,636 Allowance for loan losses (59,607) (66,593) ------------------------------------------------------------------------------------------- Total assets $7,722,135 $7,074,196 =========================================================================================== LIABILITIES -------------------------------------------------------- INTEREST-BEARING LIABILITIES Interest-bearing deposits NOW account deposits $ 791,812 $ 687,573 Money market investment deposits 1,409,981 1,381,507 Savings deposits 602,763 538,379 Other time deposits 738,464 834,169 Time deposits $100,000 and over 698,795 662,523 ---------- ---------- Total interest-bearing deposits 4,241,815 4,104,151 ---------- ---------- Short-term and other borrowings 692,076 439,948 ---------- ---------- Total interest-bearing liabilities 4,933,891 4,544,099 ------------------------------------------------------------------------------------------- NONINTEREST-BEARING LIABILITIES Noninterest-bearing deposits 1,878,042 1,658,202 Accrued interest payable 4,903 8,047 Other liabilities 49,823 52,501 ---------- ---------- Total liabilities 6,866,659 6,262,849 ------------------------------------------------------------------------------------------- SHAREHOLDERS' EQUITY 855,476 811,347 ------------------------------------------------------------------------------------------- Total liabilities and shareholders' equity $7,722,135 $7,074,196 =========================================================================================== EARNING ASSETS LESS INTEREST-BEARING LIABILITIES $2,241,163 $2,006,182 =========================================================================================== - MORE -
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WHITNEY HOLDING CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS March 31 December 31 March 31 (dollars in thousands) 2004 2003 2003 ------------------------------------------------------------------------------------------------------ ASSETS ---------------------------------------------------------- Cash and due from financial institutions $ 235,054 $ 270,387 $ 254,653 Federal funds sold and short-term investments 100,707 14,385 71,846 Loans held for sale 16,303 15,309 58,352 Investment securities Securities available for sale 2,017,866 2,090,870 1,802,578 Securities held to maturity 214,808 190,535 198,226 -------------------------------------------- Total investment securities 2,232,674 2,281,405 2,000,804 Loans 4,984,165 4,882,610 4,525,436 Allowance for loan losses (57,603) (59,475) (65,878) -------------------------------------------- Net loans 4,926,562 4,823,135 4,459,558 -------------------------------------------- Bank premises and equipment 147,483 148,259 149,230 Accrued interest receivable 26,056 27,305 29,026 Goodwill 69,164 69,164 69,164 Other intangible assets 22,186 23,475 27,346 Other assets 77,908 82,158 63,445 ------------------------------------------------------------------------------------------------------ Total assets $7,855,897 $7,754,982 $7,183,424 ------------------------------------------------------------------------------------------------------ ------------------------------------------------------------------------------------------------------ LIABILITIES ---------------------------------------------------------- Noninterest-bearing demand deposits $1,937,379 $1,943,248 $1,728,356 Interest-bearing deposits 4,361,011 4,215,334 4,168,404 -------------------------------------------- Total deposits 6,298,390 6,158,582 5,896,760 -------------------------------------------- Short-term and other borrowings 606,006 600,053 398,768 Accrued interest payable 4,313 4,493 7,427 Other liabilities 75,397 151,541 67,918 -------------------------------------------- Total liabilities 6,984,106 6,914,669 6,370,873 ------------------------------------------------------------------------------------------------------ SHAREHOLDERS' EQUITY ---------------------------------------------------------- Common stock, no par value 2,800 2,800 2,800 Capital surplus 190,348 183,624 170,997 Retained earnings 668,960 656,195 618,668 Accumulated other comprehensive income 20,429 8,438 27,846 Treasury stock at cost - (30) (211) Unearned restricted stock compensation (10,746) (10,714) (7,549) -------------------------------------------- Total shareholders' equity 871,791 840,313 812,551 ------------------------------------------------------------------------------------------------------ Total liabilities and shareholders' equity $7,855,897 $7,754,982 $7,183,424 ------------------------------------------------------------------------------------------------------ - MORE -
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WHITNEY HOLDING CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME ----------------------------------------------------------------------------------------- First First Quarter Quarter (dollars in thousands, except per share data) 2004 2003 ----------------------------------------------------------------------------------------- INTEREST INCOME Interest and fees on loans $ 63,011 $ 63,769 Interest and dividends on investments 23,499 22,107 Interest on federal funds sold and short-term investments 30 161 ----------------------------------------------------------------------------------------- Total interest income 86,540 86,037 ----------------------------------------------------------------------------------------- INTEREST EXPENSE Interest on deposits 7,970 12,543 Interest on short-term and other borrowings 1,380 700 ----------------------------------------------------------------------------------------- Total interest expense 9,350 13,243 ----------------------------------------------------------------------------------------- NET INTEREST INCOME 77,190 72,794 PROVISION FOR LOAN LOSSES (2,000) 500 ----------------------------------------------------------------------------------------- NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES 79,190 72,294 ----------------------------------------------------------------------------------------- NONINTEREST INCOME Service charges on deposit accounts 9,316 9,297 Secondary mortgage market operations 1,286 2,737 Bank card fees 2,336 2,206 Trust service fees 2,189 2,049 Other noninterest income 5,780 5,206 Securities transactions - - ----------------------------------------------------------------------------------------- Total noninterest income 20,907 21,495 ----------------------------------------------------------------------------------------- NONINTEREST EXPENSE Employee compensation 28,552 27,832 Employee benefits 7,513 6,658 -------------------------------- Total personnel expense 36,065 34,490 Net occupancy expense 4,784 4,596 Equipment and data processing expense 4,378 4,205 Telecommunication and postage 2,229 2,079 Corporate value and franchise taxes 1,863 1,873 Legal and professional fees 1,011 1,555 Amortization of intangibles 1,289 1,461 Other noninterest expense 10,407 9,035 ----------------------------------------------------------------------------------------- Total noninterest expense 62,026 59,294 ----------------------------------------------------------------------------------------- INCOME BEFORE INCOME TAXES 38,071 34,495 INCOME TAX EXPENSE 11,913 11,025 ----------------------------------------------------------------------------------------- NET INCOME $ 26,158 $ 23,470 ----------------------------------------------------------------------------------------- ----------------------------------------------------------------------------------------- EARNINGS PER SHARE Basic $ .65 $ .59 Diluted .64 .58 ----------------------------------------------------------------------------------------- ----------------------------------------------------------------------------------------- WEIGHTED-AVERAGE SHARES OUTSTANDING Basic 40,191,444 39,785,332 Diluted 40,861,274 40,216,355 ----------------------------------------------------------------------------------------- ----------------------------------------------------------------------------------------- CASH DIVIDENDS PER SHARE $ .33 $ .30 ----------------------------------------------------------------------------------------- - MORE -
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WHITNEY HOLDING CORPORATION AND SUBSIDIARIES SUMMARY OF INTEREST RATES (TAX-EQUIVALENT)* --------------------------------------------------------------------------------------------- First Fourth First Quarter Quarter Quarter 2004 2003 2003 --------------------------------------------------------------------------------------------- EARNING ASSETS ------------------------------------------------------------------ Loans** 5.17 % 5.20 % 5.74 % Investment securities 4.42 4.40 4.71 Federal funds sold and short-term investments .99 1.04 1.22 --------------------------- Total interest-earning assets 4.93 % 4.94 5.39 % --------------------------- --------------------------------------------------------------------------------------------- INTEREST-BEARING LIABILITIES ------------------------------------------------------------------ Interest-bearing deposits NOW account deposits .34 % .31 % .53 % Money market investment deposits .65 .65 1.06 Savings deposits .29 .28 .56 Other time deposits 1.34 1.40 2.13 Time deposits $100,000 and over 1.22 1.25 1.79 --------------------------- Total interest-bearing deposits .76 .77 1.24 --------------------------- Short-term and other borrowings .80 .62 .65 --------------------------- Total interest-bearing liabilities .76 % .76 % 1.18 % --------------------------- --------------------------------------------------------------------------------------------- NET INTEREST SPREAD (tax-equivalent) ------------------------------------------------------------------ Yield on earning assets less cost of interest- bearing liabilities 4.17 % 4.18 % 4.21 % --------------------------- --------------------------------------------------------------------------------------------- NET INTEREST MARGIN (tax-equivalent) ------------------------------------------------------------------ Net interest income (tax-equivalent) as a percentage of average earning assets 4.40 % 4.43 % 4.57 % --------------------------- --------------------------------------------------------------------------------------------- COST OF FUNDS ------------------------------------------------------------------ Interest expense as a percentage of average interest- bearing liabilities plus interest-free funds .53 % .51 % .82 % --------------------------------------------------------------------------------------------- * Based on a 35% tax rate. ** Net of unearned income, before deducting the allowance for loan losses and including loans held for sale and loans accounted for on a nonaccrual basis. - MORE -
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WHITNEY HOLDING CORPORATION AND SUBSIDIARIES LOAN QUALITY First First Quarter Quarter (dollars in thousands) 2004 2003 ----------------------------------------------------------------------------------------------- ALLOWANCE FOR LOAN LOSSES --------------------------------------------------------------- Allowance for loan losses at beginning of period $ 59,475 $ 66,115 Provision for loan losses (2,000) 500 Loans charged off (1,396) (2,006) Recoveries on loans previously charged off 1,524 1,269 -------------------------------- Net loans (charged off) recovered 128 (737) -------------------------------- Allowance for loan losses at end of period $ 57,603 $ 65,878 -------------------------------- Net annualized charge-offs (recoveries) as a percentage of average loans (.01)% .07 % Gross annualized charge-offs as a percentage of average loans .11 % .18 % Recoveries as a percentage of gross charge-offs 109.17 % 63.26 % Allowance for loan losses as a percentage of loans, at end of period 1.16 % 1.46 % --------------------------------
----------------------------------------------- March 31 December 31 March 31 2004 2003 2003 -------------------------------------------------------------------------------------------------------------- NONPERFORMING ASSETS --------------------------------------------------------------- Loans accounted for on a nonaccrual basis $ 25,095 $ 26,776 $ 41,050 Restructured loans 98 114 243 ----------------------------------------------- Total nonperforming loans 25,193 26,890 41,293 Foreclosed assets and surplus property 2,812 3,490 3,283 ----------------------------------------------- Total nonperforming assets $ 28,005 $ 30,380 $ 44,576 ----------------------------------------------- Nonperforming assets as a percentage of loans plus foreclosed assets and surplus property, at end of period .56 % .62 % .98 % Allowance for loan losses as a percentage of nonaccruing loans, at end of period 229.54 % 222.12 % 160.48 % Allowance for loan losses as a percentage of nonperforming loans, at end of period 228.65 % 221.18 % 159.54 % Loans 90 days past due still accruing $ 3,653 $ 3,385 $ 3,926 Loans 90 days past due still accruing as a percentage of loans, at end of period .07 % .07 % .09 % --------------------------------------------------------------------------------------------------------------
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