Whitney Holding Corp. Reports Operating Results (10-Q)
WHITNEY HOLDING CORP. is a Louisiana bank holding company registered pursuant to the Bank Holding Company Act of 1956. The Company through its banking subsidiaries engages in commercial and retail banking and in trust business including the taking of deposits the making of secured and unsecured loans the financing of commercial transactions the issuance of credit cards the delivery of corporate pension and personaltrust services investment services and safe deposit rentals. The LouisianaBank is active as a correspondent for other banks. Whitney Holding Corp. has a market cap of $904.9 million; its shares were traded at around $13.43 with a P/E ratio of 64 and P/S ratio of 1.3. The dividend yield of Whitney Holding Corp. stocks is 0.3%. Whitney Holding Corp. had an annual average earning growth of 5.7% over the past 10 years. Highlight of Business Operations:Whitney recorded a net loss of $11.1 million in the quarter ended March 31, 2009. Including dividends on preferred stock, the loss to common shareholders was $15.2 million or $.22 per diluted common share. The Company earned $8.2 million, or $.12 per diluted common share, for the fourth quarter of 2008 and $29.9 million, or $.45 per diluted common share, for 2008 s first quarter.
Whitney provided $65.0 million for credit losses in the first quarter of 2009, compared to $45.0 million in 2008 s fourth quarter. Net loan charge-offs in 2009 s first quarter were $31.9 million or 1.41% of average loans on an annualized basis, compared to $19.7 million, or .91%, in the fourth quarter of 2008. The allowance for loan losses increased $33.1 million during the current quarter and represented 2.17% of total loans at March 31, 2009, up from 1.77% at year end 2008.
The total of loans criticized through the Company s credit risk-rating process was $883 million at March 31, 2009, which represented 10% of total loans and a net increase of $113 million from December 31, 2008. Of the total increase, $62 million came from C&I credits from a variety of industries mainly in Louisiana and Texas. Criticized commercial real estate (CRE) loans increased $43 million from the end of 2008, with the majority from Florida markets and concentrated in loans secured by either income-producing properties or owner-user properties. Loans for residential development, investment or other residential purposes comprised approximately 36% of the criticized loan total at March 31, 2009, over half of which were from Whitney s Florida markets.
Continuing weaknesses in residential-related real estate markets, primarily in Whitney s Florida markets, accounted for approximately $26 million of the provision for credit losses for the first quarter of 2009. These loans, which are mainly for residential development or for rental operations, also accounted for $20 million of the gross charge-offs in 2009 s first quarter. Loans for CRE development or investment accounted for approximately $12 million of the provision, mainly related to further deterioration of previously criticized loans in the Tampa, Florida area. Problem C&I credits, mainly in Louisiana and Texas, added approximately $10 million to the provision for the first quarter of 2009. Management added another $10 million to the allowance and provision based on its assessment of current economic conditions and the regular qualitative and quantitative periodic reassessment of loss factors.
Noninterest income for the first quarter of 2009 increased 8%, or $2.2 million, compared to the fourth quarter of 2008. Deposit service charge income was up 7%, or $.7 million, on higher commercial account fees and the full quarter impact of Parish. Fee income from Whitney s secondary mortgage market operations grew 37%, or $.5 million, driven by refinancing activity and Parish s operations. A seasonal decline in bank card fees compared to the fourth quarter of 2008 was offset by moderate growth from several other recurring revenue sources included in other noninterest income. Other noninterest income for the first quarter of 2009 also included the $1.0 million distribution from one of the Company s grandfathered assets.
Total noninterest expense for the first quarter of 2009 increased $4.8 million from 2008 s fourth quarter. An $8.9 million increase in total personnel expense was partly offset by a $1.2 million reduction in legal and professional fees and a $3.3 million reduction in other noninterest expense items.
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