HANCOCK WHITNEY CORP
For the period ended Dec 31, 2025. Filed Feb 27, 2026.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2025 · Filed Feb 27, 2026
HWC$71.48+0.1%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2024-12-31; filed 2025-02-27.
0000950170-25-028009
Item 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSCurrent report: 10-K
Period ended 2025-12-31; filed 2026-02-27.
0001193125-26-077903
Item 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 300 previous paragraphs and 298 current paragraphs.
161 unchanged; 99 reworded; 38 added; 38 removed; 2 previous and 0 current paragraphs rearranged.
Tables are not compared: 34 previous and 34 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (38)
Current report
Acquisition
Current report
On May 2, 2025, we completed the acquisition of Sabal Trust Company (“Sabal”). Based in St. Petersburg, Florida, with three additional locations in the Central Florida region, Sabal was the largest independent, employee-owned non-depository trust company in Florida. The transaction added assets under management and administration of approximately $3 billion to our existing trust and asset management business and provides the opportunity to develop relationships and offer other private banking, wholesale and retail products and services in high-growth markets. For additional information on this transaction, refer to Note 2 – "Acquisition" in the notes to our consolidated financial statements included elsewhere in this document.
Current report
Subsequent Event
Current report
In January 2026, we executed a restructuring of our available for sale securities portfolio whereby we sold securities with an amortized cost of $1.5 billion and average yield of 2.49% and reinvested the $1.4 billion of proceeds with the purchase of securities with an average yield of 4.35%. We anticipate a 50 month payback period to cover the $98.5 million pre-tax loss associated with the sale, or approximately $0.93 per diluted share after tax, that will be reflected in our first quarter 2026 operating results. The restructure is expected to contribute approximately $23.8 million to net interest income, or $0.23 per diluted share, resulting in increases of 32 basis points (bps) to the securities portfolio yield and 7 bps to net interest margin on an annual basis.
Current report
The year ended December 31, 2025 began with notable economic shifts as the new presidential administration swiftly began implementing its second-term agenda. The impacts of tariffs, tax reform, deportations, and deregulation each carried distinct economic and market implications. Tariffs quickly became the most influential factor, creating cost pressures across supply chains. Further, concerns over the pace and scale of tariffs created increased uncertainty as to near and long term effects that led to significant volatility in equity markets in the early part of the year. As policy clarity improved, markets successfully rebounded from the steep descent and remained strong for the duration of the year.
Current report
Labor market statistics continued to indicate weakening that stemmed from policy uncertainty, labor force impacts of deportation efforts and the increasing use of artificial intelligence. Job gains decelerated substantially compared to 2024, and the unemployment rate rose to 4.4% in December 2025 compared to 4.1% a year earlier. Despite deterioration in the labor market, consumer spending remained resilient and real gross domestic product (GDP) displayed growth of approximately 2.2% for 2025, rebounding from a net decline in the first quarter. The Federal Reserve held monetary policy steady for most of the year amid the difficult crosswinds. By September, some stabilization in inflation markers and sustained weakening in the labor market led to a 25 basis point interest rate cut. Operational disruptions and negative economic impacts of the 43-day government shutdown that followed shortly thereafter further clouded the economic picture, but the Federal Reserve subsequently issued two additional 25 basis point cuts in the fourth quarter of 2025, with the expectation that the adjusted rates will allow stabilization in the labor market and the resumption of downward trends in inflationary conditions.
Current report
A number of headwinds that have burdened the financial services industry in recent years continued to ease, with many institutions benefiting from recent interest rate movement, robust capital markets, deregulation and credit quality stabilization. Within our markets, loan demand gained momentum and deposit cost pressures eased amid the falling interest rate environment, contributing favorably to net interest margin and profitability.
Current report
The baseline economic scenario acknowledges that economic policy under the current administration is rapidly shifting. Key assumptions within the December 2025 baseline forecast include the following: (1) the effective tariff rate will rise from just over 2% at the start of 2025 to approximately 12% by early 2026 before gradually falling late in the decade; (2) while the unemployment rate is still relatively low at 4.4%, it will continue to rise to a peak of 4.8% in late 2026 before gradually returning to near 4% in 2029; (3) GDP growth will begin to decelerate, displaying modest annual below-trend growth in the coming years of 2.1% in 2026, 1.9% in 2027 and 2.1% in 2028; (4) the 10-year U.S. Treasury yield will remain elevated near its current rate through the end of the decade as a result of elevated inflation and a deteriorating fiscal outlook; and (5) the soft economy and a struggling job market will prompt the Federal Reserve to continue to cut its benchmark rate until it reaches 2.75% in early 2027 before a return to its neutral level of 3% in 2028. The scenario further assumes that, with these rate cuts, the recent acceleration in inflation will prove temporary as it is largely due to a one-time price increase caused by higher tariffs.
Current report
The credit loss outlook for our portfolio as a whole has not changed materially since December 31, 2024. We continue to closely monitor our portfolio for customers that are sensitive to prolonged inflation, the elevated interest rate environment, tariffs, labor market conditions and/or other economic circumstances that may impact credit quality.
Current report
Loans of $24.0 billion, up $659.0 million, or 3%
Current report
Deposits of $29.3 billion, down $213.1 million, or 1%
Current report
Tangible common equity ratio of 10.06%, up 59 bps; common equity tier 1 capital ratio of 13.65%, down 49 bps, reflecting the return of capital through our share repurchase program and an increase in shareholder dividends
Current report
Credit metrics remain relatively stable, with criticized commercial loans down $87.7 million, or 14%, and nonaccrual loans up $9.5 million, or 10%; the net charge-off ratio was 0.22% compared to 0.19%
Current report
Net interest margin expanded 10 bps to 3.47%
Current report
Efficiency ratio (a non-GAAP measure) improved to 54.78%, compared to 55.36%
Current report
The year ended December 31, 2025 was an outstanding year for our company. Net interest margin expanded ten basis points, adjusted pre-provision net revenue and return on assets grew, efficiency ratio improved, and credit quality remained stable. We deployed capital through the repurchase of 4.3 million shares of our common stock, increasing our quarterly shareholder dividends, and funding both organic and inorganic growth, including the acquisition of Sabal Trust Company on May 2, 2025. The Sabal acquisition expanded our trust and asset management business in Central Florida and provides opportunities to build relationships in that region. We experienced loan growth of 3% across our footprint and in most business segments, driven by increased demand and progress on our multi-year growth plan. We remain committed to continuing to fulfill our organic growth initiatives while maintaining operational efficiency and proactively managing capital to enhance shareholder value.
Current report
The $105.2 million decrease in interest expense was largely driven by the impact of the falling interest rate environment on interest-bearing liabilities, particularly in interest-bearing deposit cost, volume and mix. Compared to the prior year, average interest-bearing deposits were down $191.8 million in 2025, and the mix therein saw a shift from higher-cost time deposits to transaction and savings deposits as instruments matured. Average other short-term borrowings, consisting primarily of FHLB advances, were up $104.4 million in 2025 compared to 2024, largely as a function of funding needs. Our total cost of funds decreased 31 bps to 1.57% in 2025, largely driven by a 54 bp decline in the cost of interest-bearing deposits.
Current report
Though interest rates remain elevated, the Federal Reserve issued a series of cuts to its benchmark rate between September 2024 and December 2025 totaling 175 bps. Our loan and interest-bearing deposits betas for the current down rate cycle were 34% and 48%, respectively, contributing to expansion in our net interest margin.
Current report
Noninterest income for the year ended December 31, 2025 totaled $406.4 million, a $42.3 million, or 12%, increase from 2024. The increase in noninterest income from the year ended December 31, 2024 is attributable in part to the Sabal acquisition, as well as growth in most revenue lines, partially offset by declines in gains on sales of assets and other miscellaneous income. Noninterest income variances are discussed in more detail below.
Current report
Professional services expense includes accounting and audit, legal, consulting and certain outsourced service expense. Professional services expense totaled $57.1 million in 2025, up $15.1 million, or 36%, from 2024. Included in the year ended December 31, 2025 was $1.5 million of Sabal acquisition costs highlighted as supplemental disclosure items. Excluding these acquisition costs, professional services expense was up $13.6 million, or 32%, largely attributable to costs associated with consulting and other professional services for stand-alone engagements, including process improvement projects, and to legal fees and expense for certain outsourced initiatives. Professional services expense may vary from period to period, generally related to the timing of external service needs.
Current report
Amortization of intangibles totaled $10.0 million in 2025, up $0.5 million, or 6%, from 2024 as a result of amortization of intangible assets acquired in the Sabal transaction.
Current report
Business development-related expenses (including advertising, travel, entertainment and contributions) totaled $34.3 million in 2025, up $3.2 million, or 10%, from 2024, largely driven by increases in digital media advertising, sponsorships, travel expense and charitable contributions.
Current report
All other expenses totaled $52.6 million in 2025, relatively flat compared to 2024. Included in the year ended December 31, 2025 was approximately $1.0 million of Sabal acquisition costs highlighted as supplemental disclosure items. Excluding these acquisition costs, other expenses were down $0.8 million, or 2%.
Current report
In January 2026, we executed a restructuring of our available for sale securities portfolio whereby we sold securities with an amortized cost of $1.5 billion and average yield of 2.49% and reinvested the $1.4 billion of proceeds with the purchase of securities with an average yield of 4.35%. Management deemed the restructure an effective way of utilizing capital to enhance future net interest income. For further information on the restructure, refer to the “Subsequent Event” section that appears earlier in this analysis.
Current report
Total loans at December 31, 2025 were $24.0 billion, up $659.0 million, or 3%, from December 31, 2024. The increase is reflective of increased loan demand, including strong net production in owner occupied and investor commercial real estate and equipment finance loans.
Current report
At December 31, 2025, noninterest-bearing demand deposits totaled $10.4 billion, down $222.5 million, or 2%, from December 31, 2024. Noninterest-bearing demand deposits comprised 35% of total deposits at December 31, 2025 and 36% at December 31, 2024.
Current report
(1) Includes four leases that had not yet commenced at December 31, 2025, totaling $7.4 million
Current report
Net income totaled $125.6 million, or $1.49 per diluted share, compared to $127.5 million, or $1.49 per diluted share in the third quarter of 2025
Current report
Adjusted pre-provision net revenue (PPNR), a non-GAAP measure, totaled $174.0 million, compared to $175.6 million in the prior quarter
Current report
Loans increased $362 million, or 2%
Current report
Deposits increased $620 million, or 2%
Current report
Allowance for credit losses coverage remains strong at 1.43% compared to 1.45%
Current report
Net interest margin of 3.48%, down 1 bp from the prior quarter
Current report
Tangible common equity ratio of 10.06%, up 5 bps linked-quarter; common equity tier 1 ratio was 13.65%, down 44 bps linked-quarter, reflecting the repurchase of 2.5 million shares of common stock during the fourth quarter
Current report
Efficiency ratio of 54.93%, compared to 54.10% in the prior quarter
Current report
Total loans were $24.0 billion at December 31, 2025, up $361.9 million, or 2%, from September 30, 2025. Loan growth was driven primarily by strong production in the healthcare portfolio, increased investor commercial real estate activity and continued growth in equipment finance.
Current report
Total deposits at December 31, 2025 were $29.3 billion, up $620.0 million, or 2%, from September 30, 2025. Noninterest-bearing deposits totaled $10.4 billion at December 31, 2025, up $69.7 million, or 1%, from September 30, 2025, and comprised 35% of total period-end deposits. The linked-quarter increase in noninterest-bearing deposits was due in part to a seasonal increase in public funds deposits of $190.9 million in the fourth quarter of 2025. Interest-bearing transaction and savings deposits totaled $12.0 billion at the end of the fourth quarter of 2025, up $223.4 million, or 2%, linked-quarter, largely driven by competitive products and pricing. Interest-bearing public fund deposits increased $417.4 million, or 15%, linked-quarter, totaling $3.2 billion at December 31, 2025. The increase in interest-bearing public funds was driven by seasonal inflows. Generally we experience seasonal cash inflows from public entities in the fourth quarter, with subsequent reductions in the first quarter of the following year. Compared to September 30, 2025, retail time deposits of $3.7 billion were down $90.4 million, or 2%, driven by maturity concentration and promotional rate reductions during the fourth quarter of 2025.
Current report
Noninterest expense totaled $217.9 million, up $5.1 million, or 2%, from the third quarter of 2025. Personnel expense totaled $122.5 million, up $0.5 million, or less than 1%. Net occupancy and equipment expense totaled $18.6 million, up $0.4 million, or 2%, and amortization of intangibles totaled $2.6 million for the fourth quarter of 2025, down $0.1 million, or 3%. Net ORE and other foreclosed assets expense totaled $0.5 million in the fourth quarter of 2025, compared to a net gain of $0.3 million in the third quarter of 2025. Other noninterest expense totaled $73.6 million in the fourth quarter of 2025, up $3.5 million, or 5%, linked-quarter, driven primarily increases in advertising, data processing and other professional services expenses.
Removed paragraphs (38)
Previous report
While the presidential and congressional elections came to the forefront of the economic and social landscape later in the year, progress in the fight against inflation, continued robust economic activity, softening in the labor market and the eventual shift in policy of the Federal Reserve drove much of the economic headlines during the year ended December 31, 2024. Economic activity remained resilient in 2024, with real gross domestic product (GDP) displaying healthy growth of 2.8% for the year, relatively consistent with the prior year and in excess of expectations. While the labor market remained strong overall, employment statistics began to migrate during the year. By mid-year, it seemed that the Federal Reserve’s stated inflation target of 2% was in range, and, in September, the Federal Reserve issued a 50 basis point (bp) rate cut, indicating its shift in focus to preserving a healthy labor market. Two additional 25 bp rate cuts followed in November and December. However, the upward trend in inflation markers in December coupled with concerns over the potential fiscal impacts of the current administration’s policy actions, particularly around tariffs and immigration, have somewhat clouded the picture surrounding monetary policy expectations. Longer-term interest rates experienced some volatility as the market responded to mixed data on both inflation and employment throughout the year. The 10-year U.S. Treasury yield ranged from below 4% to 4.7% ending the year at 4.6%, affecting bond indices and mortgage rates and other capital market indicators.
Previous report
Within the financial services industry, some of the headwinds experienced in much of the previous year began to ease. While interest rates remain elevated and continue to influence loan demand and deposit behavior, negative sentiment from recent high profile bank failures has receded, and funding costs that had begun to stabilize in late 2023 further benefited from rate cuts in the latter half of 2024. Within our markets, loan growth remains tempered due in part to loan demand, the credit health of borrowers, and a strategic reduction of exposure to syndicated credits as we focus on full-service relationships. However, interest rates on new, renewed and repricing variable rate loans and investment securities continue to result in higher yields on earning assets that, coupled with stabilization in funding costs, contributed to net interest margin expansion throughout the year.
Previous report
The baseline scenario continues to maintain an overall optimistic tenor with respect to economic outcomes. The forecast reflects new assumptions about fiscal policy, monetary policy and immigration and population growth given the Republican sweep of the White House and Congress. Key assumptions within the December 2024 baseline forecast include the following: (1) With the Republican majority, spending will decrease, personal income tax provisions of the Tax Cuts and Jobs Act will be extended and the corporate income tax rate will decrease to 15%; (2) The Federal Reserve will issue two rate cuts of 25 basis points each in 2025, with further gradual reductions in 2026 until the benchmark rate reaches 3%; (3) Though the labor market has softened, the economy remains near full-employment with the current unemployment rate of 4%, and is forecasted to remain relatively stable at 4.1% over the succeeding three years; (4) GDP will display modest annual below-trend growth in the coming years of 2.2% in 2025, 1.6% in 2026, and 1.8% in 2027; and, (5) the 10-year U.S. Treasury yield will remain elevated near its current rate, and is forecasted to average 4.3% for 2025 through 2027 and only gradually decline through the end of the decade.
Previous report
Loans of $23.3 billion, down $622.5 million; reflects a $307.6 million strategic reduction of the shared national credit portfolio
Previous report
Deposits of $29.5 billion, down $197.2 million; reflects organic growth offset by a decline of $582.9 million in brokered deposits
Previous report
Common equity tier 1 capital ratio of 14.14%, up 181 bps from December 31, 2023; tangible common equity ratio of 9.47%, up 110 bps
Previous report
Net interest margin expanded 3 bps to 3.37%
Previous report
Efficiency ratio (a non-GAAP measure) of 55.36%, relatively consistent with 2023
Previous report
Our results for the year ended December 31, 2024 represent a solid year of performance. Our net interest margin expanded, reflecting higher earning asset yields and stabilization in the cost of funds. Fee income grew and adjusted noninterest expense increased only modestly. Strong earnings facilitated substantial growth in our capital ratios. Though credit metrics normalized compared to the recent benign credit environment, we have not seen signs of significant weakening in any particular industry, sector or geographic segment, and we continue to maintain a robust allowance for credit loss coverage of 1.47% in light of the current credit and economic environment. We remain focused on balance sheet optimization and effective expense control, and we believe we are well positioned to continue to enhance shareholder value. As we close out our celebration of our 125th year, we are ready for the opportunities ahead, including our pending second quarter 2025 acquisition of Sabal Trust Company and the recently announced multi-year organic growth plan.
Previous report
The $88.2 million increase in interest expense was largely driven by the interest rate environment, as higher prevailing interest rates drove an increase in the cost of deposits and continued to foster shifts in deposit composition from noninterest-bearing and within the mix of interest-bearing deposits to higher-cost products, partially offset by a decrease in short-term borrowings expense, mostly attributable to a decline in average Federal Home Loan Bank (FHLB) advances. Compared to the prior year, average noninterest-bearing deposits were down $1.4 billion, while higher-cost time deposits were up $857.8 million. Average short-term borrowings in 2024 were down $802.0 million from 2023, as the incremental FHLB borrowings drawn as a cautionary measure in early 2023 were repaid. Our total cost of funds increased 30 bps to 1.88% in 2024 from 1.58% in 2023, largely driven by higher interest-bearing deposit costs, up 55 bps in 2024 to 3.08% from 2.53% in 2023, and other short-term borrowing costs, which consist largely of FHLB advances, increasing 43 bps to 5.49% in 2024 from 5.06% in 2023.
Previous report
Though interest rates remain elevated, the Federal Reserve cut its benchmark rate three times during 2024, beginning in September. Our loan and interest-bearing deposits betas for the down rate cycle in the second half of the 2024 were 33% and 38%, respectively. We expect deposit costs to decline in the near term as promotional pricing has been reduced. We expect our net interest income (te) for 2025 to increase in the range of 3.5% to 4.5%. We expect modest and consistent expansion of net interest margin throughout 2025, with an emphasis on balance sheet growth and by proactively managing deposit costs as interest rates continue to decline. Our forecast assumes three 25 bp rate cuts occurring in July, September and December 2025. Modeling one and zero rate cut scenarios yielded modestly better results for the year.
Previous report
We currently expect modest charge-offs and provision in 2025; however, loan growth, portfolio composition, asset quality metrics and future assumptions in economic forecasts will drive the level of credit loss reserves in future periods.
Previous report
Noninterest income for the year ended December 31, 2024 totaled $364.1 million, a $75.6 million, or 26%, increase from 2023. For the year ended December 31, 2023, noninterest income included two supplemental disclosure items totaling $49.3 million, comprised of a $65.4 million loss on restructuring of the available for sale securities portfolio and a $16.1 million gain on the sale of a parking facility. Excluding these supplemental disclosure items, noninterest income was up $26.4 million, or 8%, driven by increases in most fee categories. Noninterest income variances are discussed in more detail below.
Previous report
We expect noninterest income for the year ended December 31, 2025 to increase 3.5% to 4.5% from the 2024 level of $364.1 million. Our forecast has not yet been updated to include any impact from the pending Sabal Trust Company transaction.
Previous report
Professional services expense totaling $41.9 million in 2024 increased $3.6 million, or 9%, from 2023, primarily driven by expenses incurred for certain outsourcing initiatives that commenced in the current year.
Previous report
Amortization of intangibles in 2024 totaled $9.4 million, a $2.1 million, or 19% decrease from 2023 as a result of the accelerated amortization methods used.
Previous report
Business development-related expenses (including advertising, travel, entertainment and contributions), totaling $31.1 million in 2024, were up $1.5 million, or 5%, from 2023. The increase was largely driven by increases in marketing and business development expense, including certain costs associated bank sponsored functions, natural disaster response and relief, travel expense and customer incentives.
Previous report
All other expenses totaled $52.5 million in 2024, up $0.3 million, or 1%, from 2023.
Previous report
We expect noninterest expense to increase 4% to 5% for the year ended December 31, 2025 from the adjusted 2024 level of $816.1 million. Our forecast has not yet been updated to include any impact from the pending Sabal Trust Company transaction.
Previous report
We recorded income tax expense at an effective rate of 19.7% in 2024, relatively consistent with 19.9% in 2023. Based on the current forecast, management expects the effective tax rate to be approximately 20% to 21% in 2025, absent any changes in tax law.
Previous report
Total loans at December 31, 2024 were $23.3 billion, compared to $23.9 billion at December 31, 2023, down $622.5 million, or 3%. The decrease is reflective of the strategic reduction of the shared national credit portfolio as we focus on originating more granular loans, down $307.6 million, and includes declines across all portfolios except for residential mortgage, discussed in more detail below.
Previous report
Management expects end of period loan growth in 2025 to be mid-single digits from the December 31, 2024 balance of $23.3 billion.
Previous report
We currently expect modest charge-offs and provision for credit losses in 2025; however, loan growth, portfolio composition, asset quality metrics and future assumptions in economic forecasts will drive the level of credit loss reserves in future periods.
Previous report
At December 31, 2024, noninterest-bearing demand deposits were $10.6 billion, down $433.1 million, or 4%, from December 31, 2023. Noninterest-bearing demand deposits comprised 36% of total deposits at December 31, 2024 and 37% at December 31, 2023. Noninterest-bearing deposit levels continued to trend downward as customers shift to interest-bearing products amid the elevated interest rate environment and as consumer and business spending remains strong. The current level of noninterest-bearing deposits to total deposits of 36% represents what we consider to be a more typical, pre-pandemic mix of noninterest-bearing and interest-bearing deposits.
Previous report
Management expects full year 2025 end of period growth in deposits to be in the low single digit range from $29.5 billion at December 31, 2024.
Previous report
Net income of $122.1 million, up $6.5 million
Previous report
Pre-provision net revenue (a non-GAAP measure) of $165.2 million, compared to $166.5 million in the prior quarter
Previous report
Loans declined $156.1 million, or 1%
Previous report
Criticized commercial loans and nonaccrual loans continued to normalize, annualized net charge-off percentage improved to 0.20%, compared to 0.30%
Previous report
Allowance for credit losses coverage remained strong at 1.47%, up 1 bp
Previous report
Deposits increased $509.9 million, or 2%
Previous report
Net interest margin 3.41%, up 2 bp
Previous report
Common equity tier 1 ratio was 14.14%, up 36 bps; tangible common equity ratio of 9.47%, down 9 bps
Previous report
Efficiency ratio (a non-GAAP measure) of 54.46%, up 4 bps
Previous report
Total loans at December 31, 2024 were $23.3 billion, a decrease of $156.1 million, or 1%, from September 30, 2024. The linked-quarter decline reflects increased payoffs of commercial real estate loans, partially offset by a seasonal increase in line utilization and higher activity in commercial non-real estate loans.
Previous report
Total deposits at December 31, 2024 were $29.5 billion, up $509.9 million, or 2%, from September 30, 2024. The increase is largely the result of seasonal inflows in interest-bearing public funds, an increase in interest-bearing transaction and savings due to seasonality, competitive products and pricing, and an increase in noninterest-bearing deposits. These increases were partially offset by a decrease in retail time deposits driven by maturity concentration repricing at lower rates and promotional rate reductions during the fourth quarter, and a decrease in brokered deposits that matured and were not replaced.
Previous report
Noninterest-bearing deposits totaled $10.6 billion at December 31, 2024, up $98.0 million, or 1%, from September 30, 2024 and comprised 36% of total deposits at December 31, 2024. Interest-bearing transaction and savings deposits totaled $11.3 billion at December 31, 2024, up $413.1 million, or 4%, compared to September 30, 2024. Interest-bearing public fund deposits increased $508.4 million, or 19%, to $3.2 billion at December 31, 2024. The increase in public funds is seasonal and largely attributable to year-end tax collections by local municipalities. Typically, these balances begin to runoff in the first quarter of each year. Retail time deposits of $4.4 billion decreased $326.0 million, or 7%, from September 30, 2024, largely attributable to maturities with lower repricing rate offerings. Brokered deposits were $6.9 million at December 31, 2024, down $183.6 million due to maturities which were not replaced.
Previous report
Noninterest expense totaled $202.3 million, down $1.5 million, or 1%, from the third quarter of 2024. The primary driver of the decrease is attributable to personnel expense, which was down $2.0 million, or 2%, from the third quarter of 2024, driven by lower incentives and retirement benefits expenses.
Reworded paragraphs (99)
Previous wording
We utilize economic forecasts produced by Moody’s Analytics (Moody’s) that provide various scenarios to assist in the development of our economic outlook. This outlook discussion utilizes the December 2024 Moody’s forecast, the most current available at December 31, 2024. The forecasts are anchored on a baseline forecast scenario, which Moody’s defines as the “most likely outcome” of where the economy is headed based on current conditions. Several upside and downside scenarios are produced that are derived from the baseline scenario and incorporate varying degrees of favorable and unfavorable adjustments to economic indicators and circumstances as compared to the baseline. The macroeconomic variables underlying the December 2024 economic scenarios differ in many respects from the comparable forecasts available at December 31, 2023, given the shift in economic circumstances and risks, particularly as a result of the outcome of the 2024 presidential and congressional elections.
Current wording
We utilize economic forecasts produced by Moody’s Analytics (Moody’s) that provide various scenarios to assist in the development of our economic outlook. This outlook discussion utilizes the December 2025 Moody’s forecast, the most current available at December 31, 2025. The forecasts are anchored on a baseline forecast scenario, which Moody’s defines as the “most likely outcome” of where the economy is headed based on current conditions. Several upside and downside scenarios are produced that are derived from the baseline scenario and incorporate varying degrees of favorable and unfavorable adjustments to economic indicators and circumstances as compared to the baseline. The macroeconomic variables underlying the December 2025 economic scenarios differ in many respects from the comparable forecasts available at December 31, 2024 given the shift in economic circumstances and risks.
Previous wording
The S-2 scenario presents a downside alternative to the baseline. The S-2 scenario assumes the impacts of current administration tariffs and deportations on the economy are worse than expected, elevated interest rates weaken credit-sensitive spending more than anticipated and there is longer and farther-reaching disturbance from geopolitical conflict. Further, the scenario assumes the unemployment rate will increase considerably to 6.3% in 2025 (peaking at 7.1% in the fourth quarter) before improving to 5.6% in 2026 and 4.1% in 2027. As a result of these pressures, the U.S. falls into a mild recession beginning in the first quarter of 2025 that lasts for three quarters, with the stock market contracting 22% and a peak-to-trough decline in GDP of 1.1%. Despite the onset of the recession, rising inflation prompts the Federal Reserve to raise its benchmark rate in the first quarter of 2025 before resuming easement in the second quarter of 2025.
Current wording
The S-2 scenario presents a downside alternative to the baseline. The S-2 scenario assumes the impacts of the current administration's tariffs and deportations on the economy are worse than expected, still-elevated interest rates weaken credit-sensitive spending more than anticipated, and there is longer and farther-reaching disturbance from geopolitical conflict. The effective tariff rate is forecasted to increase to 15% and remain elevated through the end of 2028. Further, the S-2 scenario assumes that the unemployment rate will increase considerably to 6.6% in 2026 (peaking at 7.2% in the fourth quarter) before gradually improving to 4.2% in 2029. As a result of these pressures, the U.S. falls into a mild recession beginning in the first quarter of 2026 that lasts for three quarters, with the stock market contracting 22% and a peak-to-trough decline in GDP of 1%. The combination of a recession and rising inflation causes the Federal Reserve to lower its benchmark rate moderately over the course of a few quarters; as the recession persists and inflation subsides, the Federal Reserve subsequently reduces the rate more significantly.
Previous wording
Management has deemed certain assumptions underlying the S-2 scenario to be somewhat more likely to occur in the near term than those underlying the baseline scenario, and as such, the baseline scenario and the S-2 scenario were given probability weightings of 40% and 60%, respectively, in the calculation of our allowance for credit losses calculation at December 31, 2024.
Current wording
Management has deemed certain assumptions underlying the S-2 scenario to be as likely to occur in the near term than those underlying the baseline scenario, and as such, the baseline scenario and the S-2 scenario were each given probability weightings of 50% in the calculation of our allowance for credit losses calculation at December 31, 2025.
Previous wording
Recent and expected changes in fiscal and other policies with the current administration creates significant uncertainty as to the impact on the U.S and global economies. The effects of continued elevated inflation, and the Federal Reserve’s actions to counter those effects, as well as to respond to other economic concerns, could reduce economic growth in the near term. The full extent of the impact of these and other influential factors are uncertain and may have an adverse effect on the U.S. economy, including the possibility of an economic recession or slower growth in the near or midterm.
Current wording
Rapidly evolving changes in fiscal and other policies of the current administration have created heightened uncertainty as to the impact on the U.S and global economies. The effects of continued elevated inflation, a softening labor market, and the Federal Reserve’s actions to counter those effects, as well as to respond to other economic concerns, could reduce economic growth in the near term. The full extent of the impact of these and other influential factors are uncertain and may have an adverse effect on the U.S. economy, including the possibility of an economic recession or slower growth in the near or midterm.
Previous wording
Net income for the year ended December 31, 2024 was $460.8 million, or $5.28 per diluted common share, compared to $392.6 million, or $4.50 per diluted common share in 2023. Included in the results of the year ended December 31, 2024 is a charge of $3.8 million, or $0.03 per diluted share after-tax, supplemental disclosure item attributable to a revision of the FDIC special assessment. Included in the results of the year ended December 31, 2023 is a net charge of $75.4 million (pre-tax), or $0.68 per share after tax, comprised of the following supplemental disclosure items: a $65.4 million loss on restructuring of the securities portfolio, a $26.1 million FDIC special assessment charge and a $16.1 million gain on the sale of a parking facility. The following is an overview of financial results for the year ended December 31, 2024 compared to December 31, 2023:
Current wording
Net income for the year ended December 31, 2025 was $486.1 million, or $5.67 per diluted common share, compared to $460.8 million, or $5.28 per diluted common share in 2024. Included in the results of the year ended December 31, 2025 is a charge of $5.9 million (pre-tax), or $0.05 per share after tax, attributable to costs associated with the acquisition of Sabal. Included in the results of the year ended December 31, 2024 is a charge of $3.8 million, or $0.03 per diluted share after-tax, supplemental disclosure item attributable to a revision of the FDIC special assessment. The following is an overview of financial results for the year ended December 31, 2025 compared to December 31, 2024:
Previous wording
Net income of $460.8 million, or $5.28 per diluted common share
Current wording
Net income of $486.1 million, or $5.67 per diluted common share, up from $460.8 million, or $5.28 per diluted share
Previous wording
Adjusted pre-provision net revenue (a non-GAAP measure) totaled $641.0 million, up $5.3 million
Current wording
Adjusted pre-provision net revenue, a non-GAAP measure, totaled $679.9 million, up $38.8 million
Previous wording
Provision for credit losses of $52.2 million in 2024, compared to $59.1 million in 2023; allowance for credit losses to total loans remains strong at 1.47% at December 31, 2024, up 6 basis points
Current wording
Provision for credit losses of $51.2 million in 2025, compared to $52.2 million in 2024; allowance for credit losses to total loans remains strong at 1.43% at December 31, 2025, down 4 basis points
Previous wording
(a) Interest income includes the net impact of discount accretion and premium amortization arising from business combinations totaling $2.1 million, $2.4 million, and $4.7 million for the years ended December 31, 2024, 2023 and 2022, respectively.
Current wording
(a) Interest income includes the net impact of discount accretion and premium amortization arising from business combinations. Net purchase accounting discount accretion totaled $2.1 million and $2.4 million the years ended December 31, 2024, and 2023. There was no net purchase accounting discount accretion included in interest income in 2025.
Previous wording
Net interest income was $1.1 billion in 2024, down $15.7 million, or 1%, from 2023. Net interest income is the primary component of our earnings and represents the difference, or spread, between revenue generated from interest-earning assets and the interest expense related to funding those assets. For analytical purposes, net interest income is adjusted to a taxable equivalent basis (te) using the statutory federal tax rate of 21% on tax exempt items (primarily interest on municipal securities and loans). Net interest income (te) was $1.1 billion in 2024, also down $15.7 million, or 1%, from 2023, and included an increase in interest income (te) of $72.5 million more than offset by an increase of $88.2 million in interest expense. Net interest margin, the ratio of net interest income (te) to average earning assets, increased 3 bps to 3.37% in 2024 from 3.34% in 2023.
Current wording
For the year ended December 31, 2025, net interest income was $1.1 billion, up $26.9 million, or 2%, from 2024. Net interest income is the primary component of our earnings and represents the difference, or spread, between revenue generated from interest-earning assets and the interest expense related to funding those assets. For analytical purposes, net interest income is adjusted to a taxable equivalent basis (te) using the statutory federal tax rate of 21% on tax exempt items (primarily interest on municipal securities and loans). Net interest income (te) was $1.1 billion in 2025, up $26.1 million, or 2%, from 2024, comprised of a decrease in interest income (te) of $79.1 million that was more than offset by a decrease of $105.2 million in interest expense. The increase in net interest income (te) was largely interest rate driven, as the decline in prevailing rates on interest-bearing liabilities and an increase in securities yields outpaced lower yields on loans; it is also reflective of the impact of favorable changes in average balance of and mix within interest-bearing liabilities that was partially offset by the impact of a decline in average loans. Net interest margin, the ratio of net interest income (te) to average earning assets, increased 10 bps to 3.47% in 2025 from 3.37% in 2024.
Previous wording
The $72.5 million increase in interest income (te) is largely attributable to the sustained elevated interest rate environment, partially offset by a $738 million decrease in average earning assets. The yield on earning assets (te) was 5.26% in 2024, up 34 bps from 2023. Loan yield was up 30 bps to 6.17%, reflecting the impact of the new and repricing loans in the current interest rate environment. The yield on investment securities increased 24 bps in 2024 to 2.63% as new investments were made at higher yields. The decline in average earning assets included decreases of $680 million in investment securities and $91 million in short-term investments, while average total loans remained relatively flat, but experienced a shift in mix from commercial and consumer loans into residential mortgage.
Current wording
The $79.1 million decrease in interest income (te) was largely attributable to a decrease in both loan yields and average balances, partially offset by increases in securities yields and average balances. The yield on earning assets (te) was down 22 bps to 5.04%, driven primarily by a 34 bp decline in the loan yield that reflects the impact of the new and repricing loans in the current interest rate environment. The yield on investment securities was up 25 bps to 2.88% as new investments and reinvestments were made at higher yields, and also reflecting the favorable impact of certain fair value hedges that became effective in 2025.
Previous wording
Included in interest income is net purchase accounting accretion of $2.1 million, $2.4 million and $4.7 million for the years December 31, 2024, 2023, and 2022 respectively.
Current wording
Included in interest income is net purchase accounting accretion of $2.1 million and $2.4 million for the years ended December 31, 2024, and 2023, respectively. There was no purchase accounting accretion in 2025.
Previous wording
During the year ended December 31, 2024, we recorded a provision for credit losses of $52.2 million compared to $59.1 million for the year ended December 31, 2023. The provision for credit losses recorded in 2024 included net charge-offs of $46.0 million and a $6.1 million reserve build. The provision for credit losses recorded in 2023 included net charge-offs of $63.4 million and a reserve release of $4.3 million. The provision for credit losses for the year ended December 31, 2023 included a $29.7 million charge-off attributable to a single participation in a shared national credit. The modest reserve build in 2024 is the result of a higher allowance for credit loss coverage to total loans, reflecting the impact of prolonged elevated interest rates and inflation and other market conditions.
Current wording
During the year ended December 31, 2025, we recorded a provision for credit losses of $51.2 million, compared to $52.2 million for the year ended December 31, 2024. The provision for credit losses recorded in 2025 included net charge-offs of $52.5 million and a $1.3 million reserve release. The provision for credit losses recorded in 2024 included net charge-offs of $46.0 million and a reserve build of $6.1 million. The modest reserve release in 2025 reflects our relatively consistent economic outlook and stable credit metrics.
Previous wording
Net charge-offs for the year ended December 31, 2024 totaled $46.0 million, or 0.19% of average loans outstanding, comprised of net charge-offs of $31.3 million in the commercial portfolio and $14.9 million in the consumer portfolio, partially offset by net recoveries of $0.2 million in the residential mortgage portfolio. Net charge-offs for the year ended December 31, 2023 totaled $63.4 million, or 0.27% of average loans outstanding, comprised of net charge-offs of $52.8 million in the commercial portfolio (inclusive of the $29.7 million single borrower charge-off described above) and $11.8 million in the consumer portfolio, partially offset by net recoveries of $1.2 million in the residential mortgage portfolio.
Current wording
Net charge-offs for the year ended December 31, 2025 totaled $52.5 million, or 0.22% of average loans outstanding, comprised of net charge-offs of $39.4 million in the commercial portfolio, $0.1 million in the residential mortgage portfolio and $13.0 million in the consumer portfolio. Net charge-offs for the year ended December 31, 2024 totaled $46.0 million, or 0.19% of average loans outstanding, comprised of net charge-offs of $31.3 million in the commercial portfolio and $14.9 million in the consumer portfolio, partially offset by net recoveries of $0.2 million in the residential mortgage portfolio. The increase in net charge-offs compared to the prior year was due to lower recoveries of $16.0 million compared to $27.1 million in 2024. Gross charge-offs for 2025 were down $4.6 million, at $68.5 million compared to $73.1 million in 2024.
Previous wording
Service charges on deposit accounts include consumer, business, and corporate deposit account servicing fees, as well as nonsufficient funds fees on non-consumer accounts, overdraft and overdraft protection fees, and other customer transaction-related fees. Service charges on deposit accounts were $91.1 million, up $5.1 million, or 6%, from 2023. The increase from 2023 was largely attributable to a $4.4 million increase in service charges on business accounts, including commercial analysis fees, nonsufficient funds and overdraft fees, driven by deposit balance activity, strong sales activity, and higher instances of overdrafts. Consumer service charges increased $0.7 million compared to the prior year.
Current wording
Service charges on deposit accounts include consumer, business, and corporate deposit account servicing fees, as well as nonsufficient funds fees on non-consumer accounts, overdraft and overdraft protection fees, and other customer transaction-related fees. Service charges on deposit accounts were $99.2 million, up $8.1 million, or 9%, from 2024. The increase from 2024 was largely attributable to increases of $4.1 million in consumer overdraft fees and service charges, and $4.3 million in analysis fees and overdraft fees on business accounts.
Previous wording
Trust fee income represents revenue generated from asset management services provided to individuals, businesses and institutions. Trust fees totaled $71.7 million in 2024, a $4.2 million, or 6%, increase from 2023, primarily attributable to an increase of $2.5 million in personal trust income, $1.4 million in institutional trust fees, and $0.4 million in corporate trust and retirement services fees. Trust assets under management increased to $10.2 billion at December 31, 2024, compared to $9.7 billion at December 31, 2023.
Current wording
Trust fee income represents revenue generated from asset management services provided to individuals, businesses and institutions. Trust fees totaled $89.6 million, up $17.9 million, or 25%, from 2024. The increase reflects $14.5 million in personal trust fees as a result of the Sabal acquisition and growth in our legacy personal and corporate trust fees, partially offset by a decline in employee benefits trust revenue. Trust assets under management increased to $14.0 billion at December 31, 2025, inclusive of $2.7 billion attributable to the Sabal transaction, compared to $10.2 billion at December 31, 2024.
Previous wording
Bank card and ATM fees include income from credit and debit card transactions, fees earned from processing card transactions for merchants, and fees earned from ATM transactions. Bank card and ATM fees totaled $85.5 million in 2024, up $2.5 million, or 3%, compared to 2023. The increase from 2023 is the result of increases of $1.7 million in merchant fees and $1.1 million in debit and credit card fees, as spending was strong in 2024, partially offset by a $0.3 million decrease in ATM fees.
Current wording
Bank card and ATM fees include income from credit and debit card transactions, fees earned from processing card transactions for merchants, and fees earned from ATM transactions. Bank card and ATM fees totaled $86.1 million, up $0.6 million, or 1%, with increases in purchasing card and debit card processing fees largely offset by declines in business credit card processing fees and ATM fees.
Previous wording
Investment and annuity fees and insurance commissions, which include both fees earned from sales of annuity and insurance products as well as managed account fees, totaled $43.4 million in 2024, a $6.7 million, or 18%, increase from 2023. The increase is largely attributable to a $7.4 million increase in annuity fees and investment fees as sales activity increased amid the favorable interest rate environment, partially offset by a $0.7 million decline in corporate underwriting and insurance fees.
Current wording
Investment and annuity fees and insurance commissions, which include both fees earned from sales of annuity and insurance products as well as managed account fees, totaled $49.2 million, a $5.7 million, or 13%, increase from 2024, largely attributable to increases of $2.0 million in investment management fees and $1.9 million in fixed income trading fees and also reflects increases in annuity fees, corporate underwriting fees and insurance commissions.
Previous wording
Income from secondary mortgage market operations is comprised of income produced from the origination and sales of residential mortgage loans in the secondary market. We offer a full range of mortgage products to our customers and typically sell longer-term fixed rate loans, while retaining the majority of adjustable-rate loans and mortgage loans generated through programs to support customer relationships. Income from secondary mortgage market operations totaled $12.4 million in 2024, an increase of $3.2 million, or 35%, from 2023. Although there continued to be a dampened demand for mortgage loans and refinancing as a result of the elevated interest rate environment, the dollar amount of mortgage loan originations that were sold in the secondary market versus retained in our portfolio in 2024 was up 30%, driving higher income in this business line. Secondary mortgage market operations income will vary based on application volume and the percentage of loans closed and ultimately sold.
Current wording
Income from secondary mortgage market operations is comprised of income produced from the origination and sales of residential mortgage loans in the secondary market. We offer a full range of mortgage products to our customers and typically sell longer-term fixed rate loans, while retaining the majority of adjustable-rate loans and mortgage loans generated through programs to support customer relationships. Income from secondary mortgage market operations totaled $14.8 million, an increase of $2.4 million, or 19%, from 2024. The increase was attributable to higher mortgage loans production compared to the prior year. Secondary mortgage market operations income will vary based on application volume and the percentage of loans closed and ultimately sold.
Previous wording
There were no gains or losses on sales of securities during the year ended December 31, 2024. There was a $65.4 million loss on sales of securities for the year ended December 31, 2023 as a result of the strategic restructuring of the available for sale portfolio to enhance net interest margin through deployment of the proceeds into higher-yielding earning assets and repayment of short-term borrowings.
Current wording
Losses on sales of securities totaled less than $0.1 million for the year ended December 31, 2025. There were no gains or losses on sales of securities during the year ended December 31, 2024.
Previous wording
Income from bank-owned life insurance (BOLI) is generated through insurance benefit proceeds as well as the growth of the cash surrender value of insurance contracts held. BOLI income totaled $16.9 million, an increase of $1.5 million, or 10%, from 2023. The increase was primarily driven by an increase in income from changes in cash surrender value.
Current wording
Income from bank-owned life insurance (BOLI) is generated through insurance benefit proceeds as well as the growth of the cash surrender value of insurance contracts held. BOLI income totaled $21.3 million in 2025, an increase of $4.4 million, or 26%, from 2024. The increase was attributable to an increase in income from changes in cash surrender value of $3.0 million and an increase in mortality gains of $1.4 million.
Previous wording
Credit-related fees include fees assessed on letters of credit and unused portions of loan commitments. Credit-related fees were $12.0 million for 2024, down $0.5 million, or 4% compared to 2023, attributable to decreases of $0.4 million in letter of credit fees and $0.1 million in unused commitment fees. Income from these products will vary based on letters of credit issued, credit line utilization and prevailing assessment rates.
Current wording
Credit-related fees include fees assessed on letters of credit and unused portions of loan commitments. Credit-related fees were $11.3 million in 2025, down $0.8 million, or 6%, from 2024, driven primarily by a decrease in unused commitment fees. Income from these products will vary based on letters of credit issued, credit line utilization and prevailing assessment rates.
Previous wording
Income or loss from derivatives, largely resulting from our customer interest rate derivative program, was a loss of $3.8 million in 2024, compared to income of $0.4 million in 2023. Derivative income or loss can be volatile and is dependent upon the composition of the portfolio, volume and mix of sales activity and market value adjustments due to market interest rate movement. The year-over-year decline is primarily due to a $3.8 million decrease in customer derivative income largely tied to the elevated interest rate environment, which affects demand for variable rate loans and related derivative products, valuation adjustments, and related collateral income/expense for the program as a whole. The decline in derivative income also reflects a $1.4 million increase in losses associated with our Visa Class B derivative contract.
Current wording
Income from derivatives, largely resulting from our customer interest rate derivative program, totaled $5.8 million in 2025, compared to a loss of $3.8 million in 2024. The year-over-year increase was due largely to higher income of $6.5 million associated with our customer interest rate derivative program, driven mostly by favorable market conditions. In addition, losses resulting from assumption changes to the Visa Class B derivative liability was down $2.5 million. The remaining year-over-year increase is largely attributable to the lower holding costs related to derivative collateral. Derivative income or loss can be volatile and is dependent upon the composition of the portfolio, volume and mix of sales activity and market value adjustments due to market interest rate movement.
Previous wording
Net gains on sales of premises, equipment and other assets consists primarily of net revenue earned from sales of excess bank owned facilities and equipment no longer in use, gains on sales of Small Business Administration and other non-residential mortgage loans, and leases and other assets associated with the equipment finance line of business. Net gains on sales of premises, equipment and other assets totaled $7.8 million in 2024, compared to $19.4 million in 2023, down $11.6 million. The decrease was primarily related to previously mentioned gain on the sale of a stand-alone parking facility of $16.1 million in 2023 that was identified as a supplemental disclosure item. Excluding the supplemental disclosure item, net gains on sales of premises, equipment and other assets were up $4.6 million, and largely related to gains on sales of SBA loans and other premises sales.
Current wording
Net gains on sales of premises, equipment and other assets consists primarily of net revenue earned from sales of excess bank owned facilities and equipment no longer in use, gains on sales of Small Business Administration and other non-residential mortgage loans, and leases and other assets associated with the equipment finance line of business. Net gains on sales of premises, equipment and other assets totaled $6.1 million in 2025, compared to $7.8 million in 2024, down $1.7 million, as the comparative period included a $1.5 million gain on the sale of a former branch property.
Previous wording
Other miscellaneous income is comprised of various items, including dividends on FHLB stock, income from small business investment companies (SBICs), and syndication fees, among others. Other miscellaneous income for the year ended December 31, 2024 was $27.0 million, up $3.4 million, or 14%, from 2023, largely due to a $2.2 million increase in dividends on FHLB stock as a result of both an increase in prevailing rates and an increase in volume of stock owned and a $1.0 million increase in income from SBICs.
Current wording
Other miscellaneous income is comprised of various items, including dividends on FHLB stock, income from small business investment companies (SBICs), and syndication fees, among others. Other miscellaneous income for the year ended December 31, 2025 was $23.0 million, down $4.0 million, or 15%, from 2024, driven primarily by a decrease of $6.6 million in dividends on FHLB stock, reflecting a decline in the level of stock owned and the yield, partially offset by an increase of $2.9 million in syndication fees.
Previous wording
Noninterest expense for the year ended December 31, 2024 totaled $819.9 million, a $16.9 million, or 2%, decrease from 2023. Noninterest expense for both years includes supplemental disclosure items attributable to a special assessment by the FDIC in connection with the protection of uninsured depositors under the systemic risk exception for two bank failures in 2023, totaling $26.1 million in 2023, with an additional adjustment to the assessment of $3.8 million in 2024. Excluding the supplemental disclosure items for both periods, noninterest expense totaled $816.1 million, up $5.4 million, or 1%, from 2023. Noninterest expense variances are discussed in more detail below.
Current wording
Noninterest expense for the year ended December 31, 2025 totaled $851.6 million, a $31.7 million, or 4%, increase from the year ended December 31, 2024. Included in noninterest expense for year ended December 31, 2025 were supplemental disclosure items totaling $5.9 million attributable to costs associated with the acquisition of Sabal. Included in noninterest expense for the year ended December 31, 2024 is a supplemental disclosure item of $3.8 million attributable to an adjustment to the special assessment by the FDIC in connection with the protection of uninsured depositors under the systemic risk exception. Excluding the supplemental disclosure items for both periods, noninterest expense totaled $845.7 million, up $29.6 million, or 4%, from 2024. Noninterest expense variances are discussed in more detail below.
Previous wording
Personnel expense consists of salaries, incentive compensation, long-term incentives, payroll taxes, and other employee benefits such as 401(k), pension, and medical, life and disability insurance. Personnel expense totaled $469.4 million in 2024, up $8.6 million or 2%, compared to 2023. The increase in personnel expense was largely driven by higher incentive-based compensation, bonus, merit-based increases in salaries, related payroll tax expense and health insurance benefit cost. These increases were partially offset by the impact of a decrease in headcount and a favorable impact from salary deferrals associated with lending activities.
Current wording
Personnel expense consists of salaries, incentive compensation, long-term incentives, payroll taxes, and other employee benefits such as 401(k), pension, and medical, life and disability insurance. Personnel expense totaled $475.4 million in 2025, up $6.0 million, or 1% from 2024. The year ended December 31, 2025 included $1.4 million of Sabal acquisition costs highlighted as supplemental disclosure items. Excluding these acquisition costs, personnel expense was up $4.6 million, or 1%. The increase was driven largely by increases in salary, bonus and stock-based compensation expenses, reflecting merit increases and higher headcount, as well as an increase in associate acquisition expenses. These increases were partially offset by a favorable impact from salary deferrals associated with lending activities, and decreases in commissions, incentives expense and retirement and health benefits expense. Personnel expense associated with ongoing Sabal operations contributed $5.9 million to the variance compared to the prior year.
Previous wording
Occupancy and equipment expenses are primarily composed of lease expenses, depreciation, maintenance and repairs, rent, taxes, and other equipment expenses. Total occupancy and equipment expenses of $71.1 million in 2024, increased $0.7 million, or 1%, from 2023. The increase was largely driven by the elimination of revenue from the parking facility sold in late 2023 and an increase in leased facility expense, partially offset by decreases in depreciation and maintenance on furniture, fixtures and equipment.
Current wording
Occupancy and equipment expenses are primarily composed of lease expenses, depreciation, maintenance and repairs, rent, taxes, and other equipment expenses. Occupancy and equipment expenses totaled $72.9 million in 2025, up $1.8 million, or 3%, from 2024, largely driven by building and equipment maintenance and leased facility expense that were partially offset by decreases in depreciation and amortization and building insurance costs.
Previous wording
Data processing expense includes expenses related to third party technology processing and servicing costs, technology project costs and fees associated with bank card and ATM transactions. Data processing expense totaling $121.9 million in 2024 was up $4.2 million, or 4%, from 2023. The increase was largely attributable to higher costs associated with ongoing data processing arrangements of $3.7 million and net card, ATM and merchant fee expense of $1.4 million. These increases were partially offset by a decrease in software amortization $1.1 million.
Current wording
Data processing expense includes expenses related to third party technology processing and servicing costs, technology project costs and fees associated with bank card and ATM transactions. Data processing expense totaled $127.2 million in 2025, up $5.3 million, or 4%, from 2024. Included in the year ended December 31, 2025 was $2.0 million of Sabal acquisition costs highlighted as supplemental disclosure items. Excluding these acquisition costs, data processing expense was up $3.4 million, or 3%. The increase was largely attributable to increases in certain technology processing, licensing and maintenance totaling $5.1 million, increases in activity-based fees, including card processing, credit card rewards expense and ATM servicing totaling $2.7 million, partially offset by a decrease in amortization and maintenance on data processing software of $4.4 million. Data processing expense can vary from period to period, depending on business needs and technology enhancement initiatives.
Previous wording
Deposit insurance and regulatory fees totaled $24.2 million for the year ended December 31, 2024, a decrease of $25.8 million from 2023. Included in the years ended December 31, 2024 and 2023 are previously mentioned $3.8 million and $26.1 million, respectively, of expense attributable to a special assessment made by the FDIC. Excluding the special assessment charges in the respective periods, deposit insurance and regulatory fees were down $3.4 million, or 14%, mostly reflective of changes in our risk-based assessment calculation.
Current wording
Deposit insurance and regulatory fees totaled $18.0 million for the year ended December 31, 2025, down $6.2 million, or 26%, from 2024. Included in the year ended December 31, 2024 is the supplemental disclosure item of $3.8 million described above attributable to a special assessment made by the FDIC. Excluding the supplemental disclosure item, deposit insurance and regulatory fees were down $2.4 million, or 12%, from 2024, mostly reflective of changes in our risk-based assessment calculation as well as less significant quarterly adjustments to the special assessment based on quarterly updates from the FDIC.
Previous wording
Net gains on sales of other real estate and foreclosed assets exceeded expense by $2.5 million in 2024, compared to $0.6 million in 2023. Gains or losses on the sale of other real estate and foreclosed assets may occur periodically and are dependent on the number and type of assets for sale and current market conditions.
Current wording
Net loss on other real estate and foreclosed assets totaled $3.1 million in 2025, compared to a net gain of $2.5 million in 2024. The level of net income or losses associated with holding and maintaining the other real estate owned portfolio can vary depending on sales activity, valuation adjustments and income or expense associated with operating and maintaining foreclosed property. Gains or losses on the sale of other real estate and foreclosed assets may occur periodically and are dependent on the number and type of assets for sale and current market conditions.
Previous wording
Corporate value, franchise taxes, and other non-income taxes totaled $19.0 million in 2024, a decrease of $1.4 million, or 7%, from 2023, largely attributable to a decrease in bank share tax, partially offset by an increase in franchise tax. The calculation of bank share tax is based on multiple variables, including average quarterly assets, earnings and stockholders’ equity to determine the taxable assessment value.
Current wording
Corporate value, franchise taxes, and other non-income taxes totaled $17.3 million in 2025, down $1.7 million, or 9%, from 2024, largely driven by decreases in both bank share tax and franchise tax. Bank share tax, the largest component of this line item, is based on multiple variables, including average quarterly assets, earnings and stockholders’ equity to determine the taxable assessment value.
Previous wording
Other retirement expense includes costs associated with pension on other post-retirement plan expense. Noninterest expense in each of the years ended December 31, 2024 and 2023 was reduced by a net credit in other retirement expense totaling $18.1 million and $13.5 million, respectively. The higher net credit in 2024 was largely driven by changes in actuarial assumptions for the current plan year.
Current wording
Other retirement expense includes costs associated with pension and other post-retirement plan expense. Noninterest expense in each of the years ended December 31, 2025 and 2024 was reduced by a net credit in other retirement expense totaling $16.2 million and $18.1 million, respectively. The decrease in the net credit in 2025 was largely driven by changes in actuarial assumptions for the current plan year.
Previous wording
Our effective tax rate has historically varied from the federal statutory rate primarily due to tax-exempt income and tax credits. Interest income on bonds issued by or loans to state and municipal governments and authorities, and earnings from the bank-owned life insurance contract program are the major components of tax-exempt income.
Current wording
We recorded income tax expense at an effective rate of 20.6% in 2025, compared to 19.7% in 2024. The comparability of the effective tax rate between 2025 and 2024 is affected by higher pre-tax book income in 2025 that decreased the relative impact of net tax benefits related to tax credit investments, tax-exempt interest income and bank-owned life insurance. Our effective tax rate has historically varied from the federal statutory rate primarily due to tax-exempt income and tax credits. Interest income on bonds issued by or loans to state and municipal governments and authorities, and earnings from the bank-owned life insurance contract program are the major components of tax-exempt income.
Previous wording
Based only on tax credit investments that have been made through 2024, we expect to realize benefits from federal and state tax credits over the next three years totaling $9.8 million, $8.2 million and $8.0 million for 2025, 2026 and 2027, respectively. We intend to continue making investments in tax credit projects. However, our ability to access new credits will depend upon, among other factors, federal and state tax policies and the level of competition for such credits.
Current wording
Based only on tax credit investments that have been made through 2025, we expect to realize benefits from federal and state tax credits over the next three years totaling $8.2 million, $8.0 million and $5.5 million for 2026, 2027 and 2028, respectively. We intend to continue making investments in tax credit projects. However, our ability to access new credits will depend upon, among other factors, federal and state tax policies and the level of competition for such credits.
Previous wording
At December 31, 2024, we had a net deferred tax asset of $146.6 million, which is comprised of $297.4 million in deferred tax assets (net of valuation allowance), offset by $150.8 million of deferred tax liabilities. Several factors are considered in determining the recoverability of the deferred tax asset components, such as the history of taxable earnings, reversal of taxable temporary differences, future taxable income and tax planning strategies. Based on our review of these factors, we have established a $2.6 million valuation allowance for state net operating losses and $2.0 million valuation allowance for deferred executive compensation.
Current wording
At December 31, 2025, we had a net deferred tax asset of $55.8 million, which is comprised of $218.9 million in deferred tax assets (net of valuation allowance), offset by $163.1 million of deferred tax liabilities. Several factors are considered in determining the recoverability of the deferred tax asset components, such as the history of taxable earnings, reversal of taxable temporary differences, future taxable income and tax planning strategies. Based on our review of these factors, we have established a $3.7 million valuation allowance for state net operating losses and $2.3 million valuation allowance for deferred executive compensation.
Previous wording
Short-term liquidity assets are held to ensure funds are available to meet the cash flow needs of both borrowers and depositors. At December 31, 2024, short-term liquidity investments, including interest-bearing bank deposits and federal funds sold, totaled $939.7 million, an increase of $312.6 million from December 31, 2023. Average short-term investments for 2024 totaled $547.8 million, a $90.8 million decrease from $638.6 million in 2023. Typically, these balances will change on a daily basis depending upon movement in customer loan and deposit accounts. The comparative average balance for the year ended December 31, 2023 was impacted by excess liquidity held in response to the disruption in the financial industry caused by bank failures. See further discussion in the “Liquidity” section that follows.
Current wording
Short-term liquidity assets are held to ensure funds are available to meet the cash flow needs of both borrowers and depositors. At December 31, 2025, short-term liquidity investments, including interest-bearing bank deposits and federal funds sold, totaled $132.3 million, a decrease of $807.4 million from December 31, 2024. Average short-term investments for 2025 totaled $492.4 million, down $55.4 million from $547.8 million in 2024. Typically, these balances will change on a daily basis depending upon movement in customer loan and deposit accounts.
Previous wording
Our investment in securities totaled $7.6 billion at both December 31, 2024 and 2023. The investment securities portfolio is managed by ALCO to assist in the management of interest rate risk and liquidity while providing an acceptable rate of return. At December 31, 2024, the amortized cost of securities available for sale totaled $5.8 billion and securities held to maturity totaled $2.4 billion, compared to $5.5 billion and $2.7 billion, respectively, at December 31, 2023. The year over year changes in each of the portfolios is largely reflective of maturities and paydowns from both portfolios reinvested in the available for sale portfolio.
Current wording
Our investment in securities totaled $8.1 billion at December 31, 2025, up $497.6 million from December 31, 2024. The investment securities portfolio is managed by ALCO to assist in the management of interest rate risk and liquidity while providing an acceptable rate of return. At December 31, 2025, the amortized cost of securities available for sale totaled $6.3 billion and securities held to maturity totaled $2.1 billion, compared to $5.8 billion and $2.4 billion, respectively, at December 31, 2024. The year over year changes in each of the portfolios is largely reflective of maturities and paydowns from both portfolios reinvested in the available for sale portfolio.
Previous wording
Our securities portfolio consists mainly of residential and commercial mortgage-backed securities that are issued or guaranteed by U.S. government agencies. We invest only in high quality investment grade securities and manage the investment portfolio duration generally between two and five and a half years. At December 31, 2024, the average expected maturity of the portfolio was 5.58 years with an effective duration of 4.12 years and a nominal weighted-average yield of 2.66%. Under an immediate, parallel rate shock of 100 bps and 200 bps, the effective duration would be 4.11 years and 4.07 years, respectively. At December 31, 2023, the average expected maturity of the portfolio was 6.22 years with an effective duration of 4.60 years and a nominal weighted-average yield of 2.48%. The change in expected maturity, effective duration, and nominal weighted-average yield is primarily attributable to portfolio reinvestment activity in 2024.
Current wording
Our securities portfolio consists mainly of residential and commercial mortgage-backed securities that are issued or guaranteed by U.S. government agencies. We invest only in high quality investment grade securities and manage the investment portfolio duration generally between two and five and a half years. At December 31, 2025, the average expected maturity of the portfolio was 5.58 years with an effective duration of 3.89 years and a nominal weighted-average yield of 2.87%. Under an immediate, parallel rate shock of 100 bp and 200 bp increases, the effective duration would be 3.95 years and 3.94 years, respectively. At December 31, 2024, the average expected maturity of the portfolio was 5.58 years with an effective duration of 4.12 years and a nominal weighted-average yield of 2.66%. The change in expected maturity, effective duration, and nominal weighted-average yield is primarily attributable to both portfolio reinvestment activity and growth in 2025.
Previous wording
We have in place fair value hedges on certain fixed-rate commercial mortgage-backed securities. As of December 31, 2024, we had approximately $477.5 million in notional amount of forward-starting fixed payer swaps that convert the latter portion of the term of these available for sale securities to a floating rate. These derivative instruments are designated as fair value hedges of interest rate risk. This strategy provides a fixed-rate coupon during the front-end unhedged tenor of the bonds and results in a floating-rate security during the back-end hedged tenor.
Current wording
We have in place fair value hedges on certain fixed-rate commercial mortgage-backed securities. As of December 31, 2025, we had approximately $397.5 million in notional amount of forward-starting fixed payer swaps that convert the latter portion of the term of these available for sale securities to a floating rate. These derivative instruments are designated as fair value hedges of interest rate risk. This strategy provides a fixed-rate coupon during the front-end unhedged tenor of the bonds and results in a floating-rate security during the back-end hedged tenor. During the year ended December 31, 2025, $248.5 million of fair value hedges became effective, with the net earnings recorded in interest income. Once effective, fair value hedges synthetically convert the notional amount of the hedged asset over the life of the hedge to a variable rate instrument that is indexed to the federal funds effective rate.
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Previous report — wording carried elsewhere
As noted above, we have estimated the Bank’s amount of uninsured deposits at December 31, 2024 to be approximately $14.6 billion, using the methodologies and assumptions required for FDIC regulatory reporting.
Previous report — wording carried elsewhere
Committee is chaired by an independent director. The Board has designated Ms. Joan Teofilo and Mr. H. Merritt Lane, III, independent directors who serve on the Board Risk Committee, as risk management experts. Other committees of the Board of Directors oversee certain risks that overlap with the Board Risk Committee’s enterprise risk management oversight, including the Compensation Committee, which evaluates and manages any risk posed by compensation and benefits programs and oversees inclusion and belonging efforts, and the Corporate Governance and Nominating Committee, which provides oversight on a broad range of issues surrounding the composition and operation of the Board of Directors.