Common shares outstanding exclude treasury shares of 4.0 million and 0.9 million with a first-in-first-out cost basis of $135.8 million and $18.5 million at December 31, 2019 and 2018, respectively. Shares outstanding also exclude unvested restricted share awards of 1.4 million and 1.3 million at December 31, 2019 and 2018, respectively.

On September 21, 2019, the Company issued 5,044,332 million shares of common stock valued at $193.8 million as consideration in its acquisition of MidSouth. Refer to Note 2 – Acquisitions and Divestiture for further information.

On September 23, 2019, the Company’s board of directors approved an amended stock buyback program that authorizes the Company to repurchase up to 5.5 million shares of its common stock through the expiration date of December 31, 2020. The program, as amended, allows the Company to repurchase its common shares in the open market, by block purchase, through accelerated share repurchase programs, in privately negotiated transactions, or as otherwise determined by the Company in one or more transactions. The Company is not obligated to purchase any shares under this program, and the board of directors may terminate or amend the program at any time prior to the expiration date.

On October 18, 2019, the Company entered into an accelerated share repurchase (“ASR”) agreement with Morgan Stanley & Co. LLC (“Morgan Stanley”) to repurchase $185 million of the Company’s common stock. Pursuant to the ASR agreement, the Company made a $185 million payment to Morgan Stanley on October 21, 2019, and received from Morgan Stanley day an initial delivery of 3,611,870 shares of the Company’s common stock, which represented 75% of the estimated total number of shares to be repurchased based on the October 18, 2019 closing price of the Company’s common stock. The Company is accounting for the ASR as two separate transactions. The initial delivery of shares totaling $138.8 million were accounted for as treasury shares, and the value of the remaining shares to be exchanged upon final settlement totaling $46.2 million is being treated as a forward contract. The Company determined the forward contract meets scope exception provided for in ASC 815-10-15-74(a) and, as such, qualifies for equity classification.

The final number of shares to be repurchased will be based generally on the volume-weighted average price per share of the Company’s common stock during the term of the ASR agreement, less a discount, and subject to possible adjustments in accordance with the terms of the ASR agreement. Because the ASR is uncollared, the Company may be obligated to return a portion of the initial shares should the average share price increase over the remaining term of the contract. Final settlement of the ASR agreement is scheduled to occur no later than the third quarter of 2020.

In 2018, under a previous Board-approved stock buyback program in place from May 2018 to September 2019, the Company repurchased 200,000 shares of its common stock at an average price of $41.30 per share.

(in thousands)	Available for Sale Securities			HTM Securities Transferred from AFS			Employee Benefit Plans			Cash Flow Hedges			Equity Method Investment			Total
Balance, December 31, 2016	$	(28,679	)	$	(14,392	)	$	(72,501	)	$	(4,960	)	$			$	(120,532	)
Net change in unrealized gain (loss)		6,903			—			—			(7,328	)		—			(425	)
Reclassification of net loss realized and included in earnings		—			—			5,201			600			—			5,801
Valuation adjustment for employee benefit plan amendment		—			—			17,315			—			—			17,315
Other valuation adjustment for employee benefit plans		—			—			(10,929	)		—			—			(10,929	)
Amortization of unrealized net loss on securities transferred to held to maturity		—			3,786			—			—			—			3,786
Income tax expense (benefit)		1,067			1,393			4,228			(2,600	)		—			4,088
Reclassification of certain tax effects (a)		6,669			2,586			13,936			2,139			—			25,330
Balance, December 31, 2017	$	(29,512	)	$	(14,585	)	$	(79,078	)	$	(11,227	)	$	—		$	(134,402	)
Net change in unrealized (loss) gain		(52,060	)		—			—			(697	)		—			(52,757	)
Reclassification of net loss realized and included in earnings		25,480			—			4,989			4,497			—			34,966
Valuation adjustment for employee benefit plans		—			—			(45,198	)		—			—			(45,198	)
Amortization of unrealized net loss on securities transferred to held to maturity		—			3,296			—			—			—			3,296
Income tax expense (benefit)		(5,967	)		755			(9,040	)		866			—			(13,386	)
Balance, December 31, 2018	$	(50,125	)	$	(12,044	)	$	(110,247	)	$	(8,293	)	$	—		$	(180,709	)
Net change in unrealized gain or loss		115,413			—			—			28,943			(434	)		143,922
Reclassification of net (gain) loss realized and included in earnings		—			—			9,174			4,255			—			13,429
Valuation adjustment for employee benefit plans		—			—			2,398			—			—			2,398
Unrealized loss on securities transferred to available for sale		(13,236	)		13,236			—			—			—			—
Amortization of unrealized net loss on securities transferred to held to maturity		—			3,153			—			—			—			3,153
Income tax expense		23,102			3,706			2,603			7,506			—			36,917
Balance, December 31, 2019	$	28,950		$	639		$	(101,278	)	$	17,399		$	(434	)	$	(54,724	)

Accumulated Other Comprehensive Income or Loss (“AOCI”) is reported as a component of stockholders’ equity. AOCI can include, among other items, unrealized holding gains and losses on securities available for sale (“AFS”), including the Company’s share of unrealized gains and losses reported by a partnership accounted for under the equity method, gains and losses associated with pension or other post-retirement benefits that are not recognized immediately as a component of net periodic benefit cost, and gains and losses on derivative instruments that are designated as, and qualify as, cash flow hedges. Net unrealized gains and losses on AFS securities reclassified as securities held to maturity (“HTM”) also continue to be reported as a component of AOCI and will be amortized over the estimated remaining life of the securities as an adjustment to interest income. Subject to certain thresholds, unrealized losses on employee benefit plans will be reclassified into income as pension and post-retirement costs are recognized over the remaining service period of plan participants. Accumulated gains or losses on the cash flow hedge of the variable rate loans described in Note 11 will be reclassified into income over the life of the hedge. Accumulated other comprehensive loss resulting from the terminated interest rate swaps will be amortized over the remaining maturities of the designated instruments. Gains and losses within AOCI are net of deferred income taxes, where applicable.

The following table shows the line items in the consolidated statements of income affected by amounts reclassified from AOCI:

Amount reclassified from AOCI (a)	Year Ended December 31,						Increase (decrease) in affected line
(in thousands)	2019			2018			item in the income statement
Amortization of unrealized net loss on securities transferred to HTM	$	(3,153	)	$	(3,296	)	Interest income
Tax effect		713			755		Income taxes
Net of tax		(2,440	)		(2,541	)	Net income
Gain (loss) on sale of AFS securities		—			(25,480	)	Securities transactions
Tax effect		—			5,720		Income taxes
Net of tax		—			(19,760	)	Net income
Amortization of defined benefit pension and post-retirement items (b)	$	(9,174	)	$	(4,989	)	Other noninterest expense
Tax effect		2,074			1,122		Income taxes
Net of tax		(7,100	)		(3,867	)	Net income
Reclassification of unrealized gain (loss) on cash flow hedges		(110	)	$	1,072		Interest income
Tax effect		25			(244	)	Income taxes
Net of tax		(85	)		828		Net Income
Amortization of loss on terminated cash flow hedges		(4,145	)		(5,569	)	Interest income
Tax effect		937			1,269		Income taxes
Net of tax		(3,208	)		(4,300	)	Net income
Total reclassifications, net of tax	$	(12,833	)	$	(30,468	)	Net income

Measures of regulatory capital are an important tool used by regulators to monitor the financial health of financial institutions. The primary quantitative measures used to gauge capital adequacy are Common equity tier 1, Tier 1 and Total regulatory capital to risk-weighted assets (risk-based capital ratios) and the Tier 1 capital to average total assets (leverage ratio). Both the Company and the Bank subsidiary are required to maintain minimum risk-based capital ratios of 8.0% total capital, 4.5% Tier 1 Common Equity, and 6.0% Tier 1 capital. The minimum leverage ratio is 3.0% for bank holding companies and banks that meet certain specified criteria, including having the highest supervisory rating. All others are required to maintain a leverage ratio of at least 4.0%.

To evaluate capital adequacy, regulators compare an institution’s regulatory capital ratios with their agency guidelines, as well as with the guidelines established as part of the uniform regulatory framework for prompt corrective supervisory action toward financial institutions. The framework for prompt corrective action categorizes capital levels into one of five classifications rating from well-capitalized to critically under-capitalized. For an institution to be eligible to be classified as well capitalized its total risk-based capital ratios must be at least 10.0% for total capital, 6.5% for Tier 1 Common Equity and 8.0% for Tier 1 capital, and its leverage ratio must be at least 5.0%. In reaching an overall conclusion on capital adequacy or assigning a classification under the uniform framework, regulators also consider other subjective and quantitative measures of risk associated with an institution. The Company and the Bank were deemed to be well capitalized based upon the most recent notifications from their regulators. There are no conditions or events since those notifications that management believes would change the classifications. At December 31, 2019 and 2018, the Company and the Bank were in compliance with all of their respective minimum regulatory capital requirements.

Following is a summary of the actual regulatory capital amounts and ratios for the Company and the Bank together with corresponding regulatory capital requirements at December 31, 2019 and 2018.

	Actual				Required for Minimum Capital Adequacy				Required To Be Well Capitalized
($ in thousands)	Amount		Ratio %		Amount		Ratio %		Amount		Ratio %
At December 31, 2019
Tier 1 leverage capital
Hancock Whitney Corporation	$	2,584,162		8.76	$	1,180,163		4.00	$	1,475,204		5.00
Hancock Whitney Bank		2,640,913		8.96		1,179,194		4.00		1,473,992		5.00
Common equity tier 1 (to risk weighted assets)
Hancock Whitney Corporation	$	2,584,162		10.50	$	1,107,527		4.50	$	1,599,761		6.50
Hancock Whitney Bank		2,640,913		10.74		1,106,558		4.50		1,598,362		6.50
Tier 1 capital (to risk weighted assets)
Hancock Whitney Corporation	$	2,584,162		10.50	$	1,476,702		6.00	$	1,968,936		8.00
Hancock Whitney Bank		2,640,913		10.74		1,475,411		6.00		1,967,214		8.00
Total capital (to risk weighted assets)
Hancock Whitney Corporation	$	2,929,387		11.90	$	1,968,936		8.00	$	2,461,171		10.00
Hancock Whitney Bank		2,836,138		11.53		1,967,214		8.00		2,459,018		10.00
At December 31, 2018
Tier 1 leverage capital
Hancock Whitney Corporation	$	2,391,762		8.67	$	1,103,544		4.00	$	1,379,430		5.00
Hancock Whitney Bank		2,351,090		8.54		1,101,372		4.00		1,376,715		5.00
Common equity tier 1 (to risk weighted assets)
Hancock Whitney Corporation	$	2,391,762		10.48	$	1,026,637		4.50	$	1,482,920		6.50
Hancock Whitney Bank		2,351,090		10.32		1,025,355		4.50		1,481,068		6.50
Tier 1 capital (to risk weighted assets)
Hancock Whitney Corporation	$	2,391,762		10.48	$	1,368,849		6.00	$	1,825,132		8.00
Hancock Whitney Bank		2,351,090		10.32		1,367,140		6.00		1,822,853		8.00
Total capital (to risk weighted assets)
Hancock Whitney Corporation	$	2,736,276		11.99	$	1,825,132		8.00	$	2,281,415		10.00
Hancock Whitney Bank		2,545,604		11.17		1,822,053		8.00		2,278,566		10.00

Regulatory policy statements provide that generally bank holding companies should pay dividends only out of current operating earnings and that the level of dividends must be consistent with current and expected capital requirements. Dividends received from the Bank have been the primary source of funds available to the Company for the payment of dividends to its stockholders. Federal and state banking laws and regulations restrict the amount of dividends the Bank may distribute to the Company without prior regulatory approval, as well as the amount of loans it may make to the Company. Dividends paid by the Bank are subject to approval by the Commissioner of Banking and Consumer Finance of the State of Mississippi. Further, beginning January 1, 2019, a capital conservation buffer of 2.5% above each of the minimum capital ratio requirements (common equity tier 1, Tier 1, and total risk-based capital) must be met for a bank or bank holding company to be able to pay dividends.