Spill siphons money out of Hancock Holding's earnings - WLOX.com - The News for South Mississippi

Spill siphons money out of Hancock Holding's earnings

GULFPORT, MS (WLOX) -

GULFPORT, MS (WLOX) - We're starting to get an idea what sort of impact the spill is having on business.

Hancock Bank's parent company saw its earnings drop by 52 percent last quarter. The reason, Hancock Holding Co. CEO John Hairston said, was due in part to the Coastal Crisis.

The CEO told WLOX News that not a single one of his industry loans have defaulted yet because of the oil crisis. However, since the company has loans out to fishermen, hotel owners, processing plant operators, and boat dealers, the bank executive expects some people to default on those loans.

To prepare for the likely loss, Hairston said the Hancock Holding group took a conservative approach.  It's putting $10 million in its loan loss reserve. Hairston said nearly half of that money would cover bad loans created by the oil spill, primarily in Mississippi and Louisiana.

According to the AP, for the three months ending June 30, Hancock earned 17 cents per share. A year ago, its second quarter earnings were 43 cents per share. The AP report said the results fell far short of Wall Street forecasts. Analysts surveyed by Thomson Reuters, on average, had forecast per-share earnings of 44 cents per share.

Hairston said the early part of the second quarter this year was improving. People seemed to be feeling better about the economy, and that spurred business for his banks.

But when oil spewed into the Gulf of Mexico in mid April, he noticed the wind come out of everybody's sails. According to Hairston, his financial team has not seen any improvement around the gulf coast region when it comes to real estate values or real estate sales.

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