Hancock Whitney Agrees to Sell $497 Million in Energy Loans

Hancock Whitney Corporation (Nasdaq: HWC) today announced it has agreed to sell $497 million of energy loans to certain funds and accounts managed by Oaktree Capital Management, L.P. The sale includes reserve-based (RBL), midstream and nondrilling service credits. The company expects to receive proceeds of $257.5 million from the sale of these loans upon satisfaction of certain closing conditions. All loans included in the transaction were re-classified as held for sale as of June 30, 2020, and any write-downs and charge-offs associated with the sale are reflected in the company’s second quarter’s results. A special provision for credit losses related to the transaction of approximately $160.1 million (pre-tax), or $1.47 per diluted share (21% tax rate), will be included in the company’s second quarter 2020 earnings results.

“The primary objective of this sale is to continue de-risking our loan portfolio by accelerating the disposition of assets that have been impacted by ongoing issues within the energy industry, and have now been further complicated by COVID-19,” said John M. Hairston, President and CEO. “While operating from a solid capital base, we decided to be opportunistic and sell these assets today, significantly de-risking our balance sheet. As a result, both nonperforming assets and criticized loans will show significant improvement, which should position us to report asset quality metrics in line with our peer groups. Additionally, we currently expect lower provisions for loan losses in the second half of 2020, due to both improved asset quality and after proactively building reserves for potential COVID-19 related issues in the first half of 2020. We also believe this transaction should position the company for a faster recovery in both earnings and returns to our shareholders.”

In addition to the special provision, the company continued building its reserve for potential losses related to COVID-19 with a second quarter provision of $146.8 million. The total provision for the loan portfolio for the second quarter of 2020 is $306.9 million. As a result of the transaction, and the COVID-19 related reserve build, the company will report a second quarter net loss of $117.1 million, or ($1.36) per diluted share. Pre-provision, net revenue is $118.5 million for the second quarter, up $2.8 million, or 2.4%, linked-quarter.

A slide presentation related to this announcement is posted in the News & Market Data (Presentations) section of the company’s Investor Relations website at www.hancockwhitney.com/investors. The company will report second quarter 2020 financial results on July 21, 2020 at 3:05pm Central Time and host a conference call to discuss both financial results and the loan sale transaction at 4:00pm Central Time the same day.

About Hancock Whitney

Since the late 1800s, Hancock Whitney has embodied core values of Honor & Integrity, Strength & Stability, Commitment to Service, Teamwork, and Personal Responsibility. Hancock Whitney offices and financial centers in Mississippi, Alabama, Florida, Louisiana, and Texas offer comprehensive financial products and services, including traditional and online banking; commercial and small business banking; private banking; trust and investment services; healthcare banking; certain insurance services; and mortgage services. The company also operates a loan production office in Nashville, Tennessee, as well as trust and asset management offices in New Jersey and New York. BauerFinancial, Inc., the nation’s leading independent bank rating and analysis firm, consistently recommends Hancock Whitney as one of America’s most financially sound banks. More information is available at www.hancockwhitney.com.

About Oaktree Capital Management, L.P.

Oaktree is a leader among global investment managers specializing in alternative investments, with $113 billion in assets under management as of March 31, 2020. The firm emphasizes an opportunistic, value-oriented and risk-controlled approach to investments in credit, private equity, real assets and listed equities. The firm has over 950 employees and offices in 19 cities worldwide.

For more information

Trisha Voltz Carlson, EVP, Investor Relations Manager

504.299.5208 or trisha.carlson@hancockwhitney.com