Whitney Holding Corp. in New Orleans has warned investors to expect major loan-loss provisioning when it reports second-quarter results July 27.
The $11.6 billion-asset company announced late Tuesday that it is expecting to record a loan-loss provision of $57 million to $62 million, primarily stemming from credit problems in Florida and worsening credit quality in Louisiana and Texas. The bulk of the provision will go toward chargeoffs, which are expected to total $52 million to $57 million. The provision also is expected to include a $5 million reserve for the effect of the oil spill on Gulf Coast beach communities.
The anticipated provision is still less than the $65 million Whitney set aside for problem loans a year earlier but would be significantly more than the $37.5 million provision reported for the first quarter.
The preannouncement sent Whitney's shares down nearly 18% Wednesday, to $8.18 at the close.
