Hancock Holding Company announces earnings for first quarter 2007

     GULFPORT, MS (April 17, 2007) - Hancock Holding Company (NASDAQ: HBHC) announced earnings for the first quarter ended March 31, 2007. Hancock's first quarter 2007 earnings were $19.2 million, a decrease of $2.8 million, or 13 percent, from the first quarter of 2006. Diluted earnings per share for the first quarter of 2007 were $0.58, a decrease of $0.09 from the same quarter a year ago.

     For comparative purposes, net income for 2006 was affected by several items related to the impact of Hurricane Katrina, which made landfall in the Company's operating region on August 29, 2005. In the third quarter of 2006, the Company reversed $20.0 million from the storm-related allowance for loan losses due to better than expected loss experience with storm-impacted credits. In addition, the Company negotiated a final settlement with the primary property and casualty insurance provider and recognized a $5.1 million gain in 2006's fourth quarter. There were no significant storm-related items in the first and second quarters of 2006.

Recovery Update

     Hancock Holding Company Chief Executive Officers Carl J. Chaney and John M. Hairston both expressed gratitude to all Hancock family members for the completion of recovery efforts from the aftermath of the 2005 storm. By April 30, 2007, the Company will complete the task of moving back into the newly restored corporate headquarters building at One Hancock Plaza.

     In addition, work is progressing on the Company's new data center, located on high ground north of Interstate 10, with an expected completion date of June 1, 2007. Hancock has also completed the necessary and prudent steps of ensuring continuity of customer and business-related operations in the event of any potential disruptions.

First Quarter 2007 Financial Highlights

• Net Income and Returns: Hancock's net income for the first quarter of 2007 was $19.2 million compared to $22.0 million for the same quarter a year ago. Return on average assets for the quarter was 1.32 percent compared to 1.49 percent for 2006's first quarter. Return on average common equity was 13.77 percent compared to 18.34 percent for the same quarter a year ago.
  
  
• Asset Quality & Allowance for Loan Losses: Hancock recorded a provision for loan losses of $1.2 million in the first quarter, which when combined with the quarter's net charge-offs of $1.47 million, resulted in a $0.3 million reduction in the allowance for loan losses between December 31, 2006 and March 31, 2007. This provision was necessary to further adjust the allowance to the level dictated by the Company's reserving methodologies. Net charge-offs for the first quarter of 2007 were $1.47 million, or 0.18 percent of average loans, down $58,000 from the $1.52 million, or 0.19 percent of average loans, reported for the fourth quarter of 2006. Net charge-offs for the first quarter of 2006 were a negative $0.11 million or negative 0.01 percent of average loans. Non-performing assets as a percent of total loans and foreclosed assets was 0.16 percent at March 31, 2007, compared to 0.13 percent at December 31, 2006. Compared to the first quarter of 2006, the ratio of non-performing assets as a percent of total loans and foreclosed assets was down 19 basis points from the 0.35 percent reported at March 31, 2006. Non-performing assets increased $1.0 million from December 31, 2006, reflecting higher levels of non-accrual loans. The Company's ratio of accruing loans 90 days or more past due to total loans was 0.18 percent at March 31, 2007, compared to 0.08 percent at December 31, 2006, and to 0.22 percent at March 31, 2006. The Company's allowance for loan losses was $46.5 million at March 31, 2007, down $.3 million from the $46.8 million reported at December 31, 2006, and $27.4 million lower than the $73.9 million reported at March 31, 2006. The ratio of the allowance for loan losses as a percent of period-end loans was 1.41 percent at March 31, 2007, and 1.44 percent at December 31, 2006. The allowance coverage ratio (allowance for loan losses to non-performers and past dues) was 414 percent for the first quarter of 2007, as compared to 433 percent for the first quarter of 2006.
  
  
• Loans: At March 31, 2007, Hancock's total loans were $3.3 billion, which represented an increase of $347.7 million, or 12 percent, from March 31, 2006. Period-end loans were up $49.0 million, or 2 percent, compared to December 31, 2006. Average loans were up $91.5 million, or 12 percent annualized, from the fourth quarter of 2006. Of that increase, approximately $50 million of growth was in Mississippi, $31 million in Louisiana, $9 million in Florida, and $2 million in Alabama. The majority of the increase in average loans compared to last quarter was in commercial purpose loans (approximately $76.5 million).
  
  
• Deposits: Period-end deposits for the first quarter were $4.9 billion, down $395.2 million, or 7 percent, from March 31, 2006, and were down $107.2 million, or 2 percent, from December 31, 2006. Average deposits were up $20.2 million, or 2 percent annualized, from the fourth quarter of 2006. The majority of the increase in average deposits was in public fund deposits (up significantly due to seasonal inflows of $78.6 million) and time deposits (up $0.8 million). Offsetting these increases was a decrease in transaction deposits ($59.2 million). The slower growth in deposits compared to the prior quarter and same quarter a year ago was the result of the continued rebuilding efforts in the region following Hurricane Katrina and the slower than expected pace of federal grants to homeowners.
  
  
• Net Interest Income: Net interest income (te) for the first quarter decreased $4.5 million, or 8 percent, from the first quarter of 2006, and was $1.6 million, or 3 percent, lower than the fourth quarter of 2006. The Company's net interest margin (te) was 4.04 percent in the first quarter, 26 basis points narrower than the same quarter a year ago and 2 basis points narrower than the previous quarter. Compared to the same quarter a year ago, the primary driver of the $4.5 million decrease in net interest income (te) was a $104.7 million, or 2 percent, decrease in average earning assets mainly from a reduction in total borrowings of $82.0 million, or 29 percent, and a decrease in average deposits of $39.8 million, or 0.8 percent. As mentioned, the net interest margin (te) narrowed 26 basis points as the decrease in the average earning asset yield (46 basis points) did not offset the increase in total funding costs (72 basis points). The Company's level of net interest income (te) in the first quarter decreased $1.6 million from the prior quarter. The net interest margin (te) narrowed 2 basis points from the prior quarter as the yield on average earning assets decreased 10 basis points, while total funding costs were up 12 basis points.
  
  
• Non-interest Income & Operating Expense: Non-interest income for the first quarter was up $1.0 million, or 4 percent, compared to the same quarter a year ago, but was down $1.6 million, or 6 percent, compared to the fourth quarter. The primary factors impacting the higher levels of non-interest income as compared to the same quarter a year ago, were higher levels of service charge fees (up $1.3 million, or 17 percent) and trust fees (up $0.6 million, or 20 percent). The decrease in noninterest income for the first quarter (excluding securities transactions) compared to the prior quarter was due to decreases in insurance fees (down $1.0 million) and other income (down $0.8 million). Operating expenses for the first quarter were $0.2 million, or 0.4 percent, higher compared to the same quarter a year ago and were $0.7 million, or 1 percent, lower than the previous quarter. The increase from the same quarter a year ago was reflected in higher levels of personnel expense (up $0.4 million) and occupancy expense (up $0.4 million).

Branch Expansion

     During the first quarter of 2007, the Company received final regulatory approval for a commercial banking charter in the state of Alabama. Hancock Bank of Alabama began operations in February 2007 with one location in an existing loan production office in Mobile, AL. A total of four branch locations will open and operate in either leased or modular facilities while permanent branch facilities are constructed. These facilities will open over the course of the next 90 days. The Company plans to open an additional branch facility in downtown New Orleans, LA (August 2007) and as many as three additional branch facilities in Pensacola, FL (first quarter 2008).

Stock Repurchases

     Approximately 228,000 of the Company's shares were repurchased during the first quarter of 2007 under the Stock Repurchase Plan that was approved in 2000. The remaining plan shares available for repurchase at March 31, 2007, were 1.3 million shares. Management intends to continue repurchasing shares as long as market conditions are conducive to that action.

About Hancock Holding Company & Hancock Bank

     Hancock Holding Company - parent company of Hancock Bank (Mississippi), Hancock Bank of Alabama, Hancock Bank of Florida, and Hancock Bank of Louisiana - has assets of more than $5.8 billion Bank subsidiaries include Hancock Investment Services, Inc., Hancock Insurance Agency, and Harrison Finance Company. Additionally, the company operates corporate trust offices in Gulfport, MS, Jackson, MS, New Orleans, and Baton Rouge. Hancock's trust department, a division of the wealth management group, has assets of $7.1 billion, with assets under management of $2.3 billion, as of December 31, 2006.

     Founded October 10, 1899, Hancock Bank is the only financial services company headquartered in the Gulf South to rate among the top 20 percent of America's top performing banks. Hancock consistently ranks as one of the country's strongest, safest financial institutions, according to Veribanc, Inc., and BauerFinancial Services, Inc. Thomson Financial also recently listed Hancock as the ninth largest corporate trustee bank in the U.S. More corporate information and Internet banking are available at www.hancockbank.com.

Financial Highlights Part 1 | Financial Highlights Part 2 | Financial Highlights Part 3

"SAFE HARBOR" STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995: Congress passed the Private Securities Litigation Act of 1995 in an effort to encourage corporations to provide information about companies' anticipated future financial performance. This act provides a safe harbor for such disclosure, which protects the companies from unwarranted litigation if actual results are different from management expectations. This release contains forward-looking statements and reflects management's current views and estimates of future economic circumstances, industry conditions, Company performance, and financial results. These forward-looking statements are subject to a number of factors and uncertainties which could cause the Company's actual results and experience to differ from the anticipated results and expectations expressed in such forward-looking statements

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