Good day, ladies and gentlemen, and welcome to the Hancock Whitney Corporation second quarter 2021 earnings conference call. At this time, all participants are in a listen-only mode. Later, we will conduct a question and answer session and instructions will follow at that time. As a reminder, this call may be recorded. I would now like to turn the call over to your host for today's conference, Trisha Carlson, Investor Relations Manager. You may begin.
Thank you and good afternoon. During today's call, we may make forward-looking statements. We would like to remind everyone to carefully review the safe harbor language that was published with the earnings release and presentation and in the company's most recent 10-K and 10-Q, including the risk and uncertainties identified therein. 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 8-K 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 Hairston, President and CEO, Mike Achary, CFO, and Chris Ziluca, Chief Credit Officer.
I will now turn the call over to John Hairston.
Good afternoon, everyone, and thank you for joining us. I'm very pleased to report Hancock Whitney's continuation of improving performance. Second quarter operating results either met or exceeded expectations for nearly every category for the quarter, with linked quarter PPNR up $6 million or 4%. Growth in core loans was well above expectations and guidance as our bankers and support teams returned fully to office in the first quarter and significantly outperformed our expected pull-through rate on a robust pipeline in most categories, and paydowns were well below our run rate for the pandemic. I do want to recognize and thank our entire team of associates for outperforming in nearly every category while simultaneously working towards right-sizing our expense base. Our credit metrics improved once again this quarter, facilitating another modest reserve release of $28 million and a negative provision of $17 million.
Sticky deposits and PPP forgiveness combined to result in elevated levels of excess liquidity on our balance sheet, which in turn compressed our NIM once again. However, while we reported a decline in the overall ratio, note that thoughtful management of the balance sheet minimized the impact on net interest income, producing a stable run rate linked quarter. As our markets continue to reopen and activity levels pick up, we are seeing growth in COVID impacted lines of business within fee income. Bank card and ATM fees are up linked quarter, buoyed by the revival of leisure and family tourism, continued success with our purchase card initiative, a helpful escalation of merchant transaction volume, and our merchant services and treasury solutions teams are winning a number of new clients. Deposit service charges and wealth management revenue also performed well in the quarter.
As we've discussed with the market previously, 2021 brought into focus the importance of reassessing how we could meet the challenges the past year presented to our company and the whole banking industry. During the second quarter, we completed our previously announced phased-in plan to streamline and strengthen our operational framework according to our clients' changing needs and habits in a recovering economy. The initiatives we undertook included a voluntary early retirement package for 647 of our associates, of which 260 accepted it. The consolidation or announcement to consolidate 38 financial centers across our footprint, the closure of two trust offices in the Northeast, and a reduction in force via the phase-out of an additional 200 positions across the organization. With the right-sizing plan complete, we will continue reinvesting a portion of our harvested expenses back into revenue production for the benefit of future years.
The net non-operating expenses associated with the entire plan are included in the second quarter's results and total $42 million or $0.37 per share. See slide 26 in our presentation deck for details. The takeaways from the commentary and slides in the investor deck should be the expense rationalization plan is complete. We've absorbed materially all the non-operating expenses, and the path is clear to achieving the 4 Q21 run rate and our guidance. From this point, we are moving forward with renewed energy, focus, and a solid capital position. We've had a good start to 2021, but are keenly focused on navigating the remaining pandemic uncertainty while simultaneously dedicated to improving performance and value. I will now turn over the call to Mike for further comments.
Thanks, John. Good afternoon, everyone. Results for the second quarter were very solid. Net income totaled $89 million or $1 per share. As John noted, the reported results included $42 million or $0.37 per share of net non-operating items. Excluding these items, EPS would have been $1.37 with operating earnings of over $121 million. Just a few comments on the major drivers of our balance sheet and NIM. Total loans declined $516 million as just over 1 billion in PPP loans were forgiven in the quarter.
Partially offsetting that decline was slightly over $100 million in new PPP funding and $412 million in organic loan growth. Core loan growth was one of the big headlines for us this quarter, and we were happy to see the results of our bankers' efforts. An increase in the pull-through rate for our pipeline led to growth across our footprint, both regionally and by specialty lines. As you can see from the chart on slide six in our earnings deck, growth was especially evident in our markets outside of Greater New Orleans, as well as in equipment finance and healthcare. A step down in payoffs compared to last quarter and stabilization in line utilization after several quarters of declines also contributed to the quarter's growth.
Going forward, our goal is to build on this progress and deploy as much of our excess liquidity as possible into loans, while recognizing headwinds still exist from amortizing-only portfolios like indirect and energy, as well as elevated levels of residential mortgage payoffs. With the PPP process now closed and into forgiveness, going forward, the overall impact of the PPP loans in our balance sheet and earnings will wane from this point. Slide seven in the earnings deck expands on those points. On the liability side of the balance sheet, our deposit levels remain resilient and have continued to increase. The elevated deposit levels and PPP forgiveness are combining to sustain and increase our levels of excess liquidity, which led to continued NIM compression. We are guiding to additional contraction in the second half of 2021 versus what we said last quarter.
That updated guidance really stems from the current levels of excess liquidity continuing to build through the end of this year, mostly from PPP forgiveness. We are expecting an additional $1.1 billion to be forgiven by year-end, but also slower deposit outflows, and in fact, we believe deposits will be up in the third quarter and then flat as we move into the fourth quarter. Another factor around the NIM guidance stems from the relative size of our bond portfolio and the level of current reinvestment yields. At nearly 25% of earning assets, and with reinvestment yields recently trending down, I think has brought us to the point where for now, we're likely to not deploy excess liquidity into bonds. The potential for higher rates down the road are also a consideration.
No major changes in the guide for what we're expecting for loan growth in the second half of 2021. We are expecting to leverage our second quarter success in growing loans and believe we can further grow our loan book between $600 million-$800 million over the second half of this year. Combining all those factors, we think the NIM could narrow another 4 basis points or so in the third quarter, and then possibly a similar level in the fourth quarter. However, as our NII guidance indicates, we do expect NII to trend flat for the next two quarters. Before I turn the call back to John, I'd like to point out a few other slides in the deck.
With the recent focus on interest rate risk and asset sensitivity in light of expectations for a rise in rates in the future, we added some additional information on slides 15 and 29 related to our hedge positions. Slide 15 also includes our usual disclosures on our variable rate loan portfolio and floors. Finally, you'll see our updated guidance on slide 20. As noted, the majority of our forward guidance is unchanged with the exception of NIM. With that, I'll turn the call back to John.
Thanks, Mike. Let's open the call for questions.
We will now begin the question and answer session. To ask a question, you may press star then one on your touchtone phone. If you're using a speakerphone, please pick up your handset before pressing the keys. To withdraw your question, please press star then two. At this time, we will pause momentarily to assemble the roster. Our first question today will come from Michael Rose with Raymond James. Please go ahead.
Hey, good afternoon.
Hey, Michael.
Thanks for taking my questions. Hey, how are you? Just wanted to get some color on the loan growth and if you can speak to where that's coming from. If I look at the balances, it looks like you had some decent construction growth this quarter, so that's part of it. If I back out the PPP, it also looks like C&I is not doing terribly bad either. I know you talked about utilization rates looked like they were up slightly in the quarter, which is a good sign. Can you just give us some greater color on where that expectation for $400 million-$500 million in the back half is coming from? Thanks.
Sure, Michael, this is John. I'll start. You actually started out a pretty good list yourself. The outperformance generally came from a number of different directions, somewhat like you cited. The anticipated tailwinds were really better than we expected, and anticipated headwinds were a little less challenging than we expected. The result is, when you mesh it together, the outside to upside. If I start with paydowns, and we'll work our way into the more exciting part. They were quite muted compared to both our expectations and really the runway for the pandemic.
We did have a few paydowns that drifted from the expected late second quarter into Q3, and that's all cooked into the near-term guidance for next quarter. It's a little early to project a permanent reduction of pay-downs across the remainder of the year, just given the up and down and so much significant volatility still left in the recovery. But certainly the last few months, we've seen an improvement in the lumpiness of the pay-down. Moving on to the other part, the better news. There were several specific areas of outperformance that may be interesting. First, the pipeline itself really began to grow more robust as the quarter progressed. The pull-through rate, the percentage of the pipeline that actually moved from application to certified application to closings was much stronger than we normally have. The pull-through rate was as high as we've ever seen it.
As I mentioned in the prepared remarks, we attribute that to the fact that our entire team was back in the office in March, about 80% or so by last August. We really began the quarter hitting on all eight cylinders and with a full complement of team members focused on moving quickly through the app process, getting all the necessary requirements, and getting to closing. That pull-through rate really was remarkably strong. That was certainly very helpful. Another area of outperformance, Michael, you mentioned, was in C&I and the equipment financing portion of C&I. About half the net growth was from a precipitous increase in our clients finally getting gear that they had had on order, and supply chain was simply in the way. The gear made it in, and we got those deals closed.
That was about half capital markets, about half in-market, existing C&I clients and new C&I clients. The supply chain roadblock softening was certainly very helpful. Healthcare also stabilized, and you see the growth numbers there on the waterfall chart in the deck were really good and exclusively in very high-quality deals. Then line utilization, as you mentioned, actually firmed up about a quarter ahead of when we expected. That was part of the difference in what we expected versus the give and give delivered is not only did it stabilize, but it actually ticked up just a bit, and that was about a quarter earlier really than we anticipated. Mike mentioned earlier in his comments that we grew across the footprint with the exception of NOLA. Notably, and that's the central super region as we have it on the loan growth waterfall.
What's really different about this quarter in New Orleans was it essentially was flat. I think the actual number was $1 million down. Call that a push. After several quarters of quarter-over-quarter continuous contraction in the NOLA book, it finally firmed up and was stable. Without that contraction, it wasn't nearly as big a contra as we've had to deal with through the, really, the entire pandemic. Finally, I think I mentioned on the call or maybe in the QA last quarter that we began to see some green shoots forming in consumer lending, and we invested pretty heavily in marketing consumer loans. The green shoots maybe flowered a bit early. In June, we had as good or better a month both in applications and in closed non-HELOC consumer lending business as we've had even before the pandemic in a normal June.
While you don't see a whole lot of big numbers out of consumer, the fact that it's approaching covering the home equity runoff from mortgage refi is sort of a big point. You don't really see that much in the waterfall, but it was actually quite helpful. It's tempting, Michael, to sound very bullish on growth, but it's still early. You see from the volatility just last week and this week, it's very difficult to predict how much PE money will come into acquiring clients, which creates lumpiness and runoff, and then a supply chain improvement that's happening. If that continues and maybe gets even better, that will certainly be a tailwind. That's also a tailwind for C&D because one of the biggest holdups that we experience in construction lending is the fact that it just takes time to get gear.
As that improves, that should be a tailwind there. That's pretty much the rundown on the whole question. Did I cover everything you wanted, Michael, or was there more?
You covered a lot there, and I appreciate all the color. Just as my follow-up, it looks like you guys didn't repurchase any stock in the quarter. You're trading at about 1.4x tangible at this point. TCE is up. With the stock trading where it is, why not use it? Would you expect to be a little bit more aggressive here? Are you waiting to hit a certain capital level, whether it's 8% TCE or whatever the threshold may be? Thanks.
Yeah, Michael, this is Mike. Just a couple of thoughts about that. Certainly in the past quarter, we said that we'd consider things like buybacks or even looking at the dividend in the second half of the year. We'll absolutely do that. Nothing to report in terms of any changes in what we'll do or how we'll look at it. Certainly, that's something that's a consideration for the next quarter or two. We absolutely get those points.
Understood. Thanks for taking my questions.
You bet. Thanks, Michael.
Our next question will come from Brett Rabatin with Hovde Group. Please go ahead.
Hey, good morning. Good afternoon, everyone.
Good afternoon.
Wanted to ask about the margin and the guidance going forward. Just a couple key things. One is, thinking about the expectations for 3Q and 4Q being down due to continued excess liquidity, can you just walk me through what your expectations? You indicated you didn't want to do much with the liquidity currently, just how that might play out over the next year. Obviously, you want to deploy in loans, just thinking about one, the liquidity, what you end up doing with it as time progresses, and then one, just it seems like the margin, ex the liquidity noise, has bottomed here. I was also hoping to get maybe some thoughts on origination rates versus the current portfolio yield.
Sure, Brad. Just a couple of thoughts to begin with, probably your last question first. Over the course of the second quarter, as John indicated, we have had absolutely fantastic levels of new production. It was up some 40%-45%. The yields that new production came on the loan portfolio was down about 25 basis points or so to around 3.3%. Certainly that's a factor and something that was a bit of a headwind, certainly, as we looked at the NIM contraction that we had this quarter. The yield in our bond portfolio was also down. That was down about 9 basis points. Certainly, with the gyrations of rates during the quarter and the 10-year kind of up and down and then back down, the reinvestment yields that were available to us in the bond portfolio, about 134 basis points.
Again, that was a bit of a headwind as well. Then finally, as we've mentioned on this call and in last quarter, just the abundance of excess liquidity that's flowed onto our balance sheet, and really not much in the way of viable options to put that excess liquidity in the absence of any meaningful loan growth. Certainly we've got some meaningful loan growth this quarter. A lot of that growth was weighted a little bit toward the back half of the quarter versus the front half. That certainly speaks for the contraction that we're expecting and for future quarters to be certainly less than we've experienced the last couple of quarters.
Kind of the final point I would mention is just in terms of how we kind of manage the balance sheet and look at things like the level that we have in our bond portfolio versus cash that we kind of keep on the sidelines. Our bond portfolio is pretty big. It currently is about 25% or so of our earning assets, and that really, at least for now, is about as big as we'd like the bond portfolio to get. Certainly for the next quarter or so, we're looking at that kind of paring back inflows into the bond portfolio. The bond portfolio is likely to come down a little bit, not a tremendous amount, but just a bit from the current levels that it exists at right now.
That'll result in more excess liquidity kind of piling up at the Fed, certainly we look to loan growth picking up in the second half of the year, especially as we go into 2022 to deploy that liquidity into. Hopefully that was helpful.
Yeah, that was very helpful. I guess the other thing I was curious about was just thinking about the expense guidance with the 4Q21 expense level of $187 million being a run rate for 2022. You mentioned in the prepared comments reinvesting for some growth going forward. I guess I'm just curious, obviously, you've done a great job managing the expense levels down the past year. From here, would it be fair to assume that there would at least be some inflationary pressure in expenses? Kind of plus what you've accomplished this year, how should we think about the go-forward rate?
Yeah, I think so. Certainly with all the news and all the discussion lately around inflation, that's certainly something I think that we're going to have to contend with in future quarters. Who knows how transitory that may be or not. That's certainly something that we've kind of built into our guidance on a go-forward basis. We obviously have announced a good deal of efficiency measures during the quarter. John kind of talked about those in his prepared comments. Really on a go-forward basis, the vast majority of those things are really in the rear view mirror. Doesn't mean that we're not going to continue to work on cost initiatives and continuing to become more efficient. I think some examples will be things related to strategic procurement that we'll continue to work on.
Again, the objective with the cost-cutting efforts that we've gone through really is twofold. First and foremost, it's become more efficient and more profitable as a company. Secondly is to create room so that we can reinvest back in the company as we've kind of talked about in the past.
Okay, great. Thanks for the call, and nice to see the loan growth Q2.
Okay. Thank you. Thanks for the question.
Our next question will come from Brad Milsaps with Piper Sandler. Please go ahead.
Hey, good evening, guys.
Hey, Brad.
Mike, I think I heard you correctly that you thought that deposit growth might kind of level off from here. Just kind of curious, what kind of gives you that assurance, and are there some specific things out there you guys see running off? I know it's just really difficult to predict off the deposit side of the equation as that sort of leads into the whole liquidity discussion.
Yeah. We actually thought that deposit growth last quarter going forward would've probably leveled off a bit more than it actually did. In the second quarter, we actually had about $63 million of positive deposit growth, and what we're expecting for the third quarter is as much as $150 million or so, and then after that kind of level off. That's kind of how we're looking at it at this point. Certainly there are an awful lot of variables to consider.
As we think about things like deposits.
Then you provided additional color on some of the cash flow hedges on page 29. Just kind of curious, are you guys contemplating maybe doing something there, closing that out, or is that just you just want it off the board disclosure? Just kind of curious kind of how you're thinking about that at this point.
Yeah. We've always kind of disclosed the cash flow hedges and the new disclosure this quarter was the fair value hedges that we have on the bond portfolio.
Right.
I think the objective there was really just to help folks understand some of the things that we're doing to potentially increase our asset sensitivity down the road a little bit. That really is the objective of the fair value hedges that we have on the bond portfolio. As far as the cash flow hedges, I think it's probably more likely than not that we'll look at terminating some part of those over the coming quarter or so. When that happens, of course, we're able to kind of lock in those gains and amortize that back into earnings. That's something to kind of be on the lookout for.
Great. Very helpful. Thank you, guys. Nice quarter.
You bet. Thank you.
Our next question will come from Jennifer Demba with Truist Securities. Please go ahead.
Thank you. Good evening. Question on mortgage lending. Can you just talk about the growth in fees this quarter and give some thoughts on your outlook there?
The growth in what? I cut out a little bit.
Fees.
In fees. Okay.
Mortgage fees.
Yeah, thank you for the question, Jennifer. We expected the volumes for mortgage to drop a bit in Q2, and it did. There was a processing change to where we incurred a bit of a one-time benefit in Q2 that caused the fee increase to be actually in the green versus the red overall. All things being equal, we do think that's probably the last green quarter unless the rate environment's so hard to predict. Who would have thought we'd see 30-year the rates we're at today just a month ago. While we think that's short-term and what we'll see is a fall off in mortgage activity for Q3, that Q2 number was really driven by the one-time money. All in all, it would have been a little bit less than last quarter. Did I answer your question?
Yes. Can you just talk about what you're thinking about in terms of loan loss releases in future quarters? Could that reserve approach the CECL Day One level?
You want to tackle that one, Mike?
Yeah. I don't know that, Jennifer, right now there's certainly any intent or plan to kind of get back to the CECL Day One or Day Two levels. Just as a reminder, that was around 128 basis points, 130 basis points or so, but didn't include the energy book. The guidance that we've given kind of on a go-forward basis is this notion of continuing to expect what we've kind of referred to as modest reserve releases. Certainly that could be or that could mean that we would have reserve releases kind of in the neighborhood maybe of what we've done the last couple of quarters. In the first quarter, that was around $23 million. In the second quarter, just over $27 million. Kind of on a go-forward basis, we think about that level of reserve release.
That probably is a good proxy around what to expect on a go-forward basis. Certainly our charge-offs, we had $10.5 million this quarter. We think that could trend down just a bit, maybe in future quarters. Certainly the provision will be kind of the resulting number between those two.
Thanks so much.
Okay. Thanks for the questions.
Our next question will come from Catherine Mealor with KBW. Please go ahead.
Thanks. I just had a follow-up on your fee guidance. It looks like we're seeing service charges remain fairly low, but you're seeing kind of a rebound in bank card and ATM fees. Just any kind of thoughts and guidance on how you're thinking about those two line items as we get into a more normalized environment?
I'll start. Thanks for the question. This is John. In the second quarter, we did have a couple of unusual items related to, I mentioned the processing benefit, which took secondary from a little less than flat to a little up. It'll trail down. It's just hard to predict the activity. What's good with our guidance is a drop-off from 2Q. The deposit service charges did indeed finally stabilize as the liquidity levels in the accounts that typically generate deposit charges began to work their way down a bit. That number's probably stable to up. Then, Trust had a really good quarter. We typically enjoy the benefit of the tax prep fees in Q2. That may drop down a little bit in the third quarter.
There's lots of puts and takes, Catherine, in that number that kind of rolls together for the guidance. The heavy movers really are the one-time action going away offset by continuing good news in card-related revenue. Remember, we keep merchant revenue inside cards. When we say cards, we're talking about commercial purchase cards, which has been an extremely bright spot and getting brighter. Consumer credit and ATM, which actually was unusually high for the second quarter. I think as people withdrew some of the proceeds from the various stimulus programs. Then wealth overall, we think is going to perform pretty well. The big news, take away the one-time charges with a little bit of drop-down in mortgage, and you kind of arrive at the guidance. Mike, you want to.
The only thing I would add to that, John, is the guidance for the third quarter is this notion of maybe down $3 million-$5 million. I would suggest that it's more likely than not that we would be kind of on the lower end of that range. Potentially down to around $3. It really points to the absence of the two items that John called out that really kind of buoyed the second quarter numbers. The mortgage fee item and then the seasonal tax fees that we typically book in the second quarter related to trust. The delta probably on a go-forward basis on the law part, if you will, is going to be specialty income. Had very little of that on a net basis in the second quarter.
Things like BOLI and derivative fee valuations and syndication fees are always pretty hard to forecast or project. To the extent that we have any kind of meaningful activity on those line items, we could outperform the guidance.
Got it. That's very helpful. I'm just kind of thinking big picture. You've given some really helpful near-term guidance. When do you think you'll return to giving CSO goals and thinking more kind of in terms of longer-term profitability outlook?
I think we'll do that in 2022, Jen, Catherine, excuse me. Look for our guidance to probably expand a little bit and go back to this notion of midterm guidance, which for us is actually CSOs on a go-forward basis.
I understand the environment's very uncertain now, but that's very helpful. All right, great. Thank you so much, and congrats on the improved growth.
You bet.
Thanks, Catherine.
Our next question will come from Matt Olney with Stephens. Please go ahead.
Great. Thanks for taking my question. I want to go back to Catherine's question around consumer fees. I'm curious if you think the bank's pricing of its products, and specifically service charges, overdraft charges, and other miscellaneous fees, the pricing of those products, is it appropriate at this point or is this something you consider modifying? I guess the question comes from more of a political standpoint. I think we've seen the administration make some noise around consumer fees over the last few weeks, so would love to hear any thoughts you have about the bank's pricing on these products for the consumer. Thanks.
Sure, it's a good question. Thanks for asking it. When overdraft and NSF fees, and I presume that's what you're really referring to, began to fall under regulatory scrutiny a number of years ago, we assured that whatever our practices were well inside the FDIC guidance. As you know, there's really no rule, there's just guidance. We fall within to well within, depending on which part of the guidance is scrutinized all of those pricing. It's not just pricing, it's really processing order, it's habits, it's maximums, et cetera. We know that we're well within all of that guidance already. Certainly our current posture would simply be to pay attention to any evolving regulatory guidance or changes. As it develops we'll certainly adhere to it.
I think our regulators have heard a lot of information from a lot of different constituencies about this subject matter through the years. They work really hard, I think, to find a balance that's prudent between protecting consumers from what could be overly aggressive practices. Certainly not in this institution, but elsewhere while simultaneously assuring that overdraft practices are available to clients who actually need them. I think they'll do a continuing good job of finding what they think the appropriate balance is, we will typically remain conservative and well within whatever that guidance may be. I guess I'm saying all that to say based on the guidance that's out there now, how we're handling that business is something better than appropriate. If the guidance changes, we'll manage to whatever that change is.
Okay. That's perfect. Thank you for that. I guess switching gears Mike, just a clarification. I think you mentioned what the day one allowance ratio would've been ex Energy, but I didn't catch the whole thing. Can you repeat?
Yeah, I didn't give the ex-energy point, Matt. What I simply said is that the 128 day two for us included the energy book that we largely sold the second quarter of last year.
Got it. Okay. Okay, perfect. Thank you, guys.
Thank you, Matt.
You bet.
Our next question will come from Kevin Fitzsimmons with D.A. Davidson. Please go ahead.
Hey, good afternoon, everyone.
Hi, Kevin.
Just wanted to follow up. I joined late. Mike, I believe you answered a question about buybacks before. I don't think you guys had said you were looking at buybacks for the second quarter, but that it was a possibility for second half. Is that the outlook, or is it something different?
No, that's accurate, Kevin. We had said in the last quarter that would be something that we would certainly address and look at in the second half of this year, and certainly that's what our plans are to do. There's nothing really new or to announce today, certainly.
Okay. Is there an authorization in place or no?
Yeah. We put a new authorization in place last quarter.
Okay.
That was one of the things that we announced intra-quarter through our 8-K.
Okay. Just a quick follow-up, I apologize if you all went over this already. Are there any notable data points or wins in terms of things being scheduled for later this year or early next year in Metro New Orleans from a tourism or hospitality standpoint that are worth noting here?
Thanks for asking the question. It is a bright spot in our story, and you may have missed when we were talking about loan growth, we shared that the central super region is kind of dominated by the New Orleans balance sheet. This quarter, for the first quarter since the pandemic began, it was a push, and a lot of that is because of all the renewed sentiment and a good bit of enthusiasm that's happening inside NOLA now as tourism returns. We certainly can't speak for biology or elected officials or what have you, but the shared commentary from the statewide folks around our region, and this includes Louisiana, would suggest very little appetite for pulling in their horns.
I think what we would expect to see is continuing improvement in both the leisure tourism, which has been enormously successful really for several months, beginning in March in New Orleans, with the return of conventions and festivals. The first two conventions in Q3 already happened, the attendance rate was very positive. The number of conventions that were not canceled from back last year when people were in the business of canceling conventions, they all seem to be having pretty good attendance. I think it's something better than a green shoot. The festivals as of now appear to be all on. I think we have Jazz Fest, which is typically a big April show that coincides with the Gulf South Bank Conference, was moved to October. It's happening. The lineup was announced a couple of weeks ago. Looks pretty good.
The French Quarter Festival is happening. A lot of the food festivals are getting scheduled. It really is sort of the last of our markets to look more like it's fully recovering from hospitality. The beach communities really didn't have a pandemic economy last summer. They were moving quickly even before there was vaccination news. New Orleans is certainly continuing to improve right now, so we're pretty enthusiastic about it.
Kevin, yeah, just a quick add. Kevin, slide eight in our earnings deck is an updated version of a slide we had last quarter, and that's simply by major region, kind of a listing of the major hospitality-related events.
Oh, great.
been delayed a couple of quarters. That central region in the middle, that's primarily New Orleans.
That's great. Okay. Thanks, Mike. Thanks, John.
You bet. Thanks for the questions.
This will conclude our question-and-answer session. I'd like to turn the conference back over to John Hairston for any closing remarks.
Yeah. Thanks, Cole, for moderating today, and thanks to everyone for your interest in Hancock Whitney. Stay safe, and we'll see you soon.
The conference is now concluded. Thank you for attending today's presentation. You may now disconnect your lines at this time.