Hancock Holding in Gulfport, Miss., will close roughly a fifth of its branches as investors press management to cut costs.
The $19.8 billion-asset company will close 40 to 45 branches at Hancock Bank in Gulfport and Whitney Bank in New Orleans, Hancock said in a press release. Most closings are scheduled for the end of August, although some may take place at the end of the year.
The banks have 259 branches in Louisiana, Texas, Mississippi, Alabama and Florida, according to the Federal Deposit Insurance Corp.
Hancock expects to incur a one-time charge of $18 million to $22 million tied to the closures, it said in a presentation at the Gulf South Bank Conference on May 13. The closures will have "very little impact" on Hancock's core markets of New Orleans and the Mississippi Gulf Coast, but should help the company reach an efficiency ratio down as low as 57% by 2016, the presentation said. The efficiency ratio was 64% on March 31.
The announcement comes less than a month after a quarterly earnings call in which investors grilled Carl Chaney, Hancock's president and co-CEO, about plans to cut annual expenses by $50 million. Chaney said that Hancock had already made all the cuts it could make at Whitney Bank, which it bought for $1.5 billion two years ago.
The branches marked for closure include eight of Hancock's 14 branches in Houston, the Houston Business Journal reported Friday. "People aren't walking into branches anymore," Randy Gartz, Whitney Bank's Houston market president, told the publication.
A Hancock spokesman did not immediately respond to a request for more details.