- Quarterly Report (10-Q)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF

THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2011

Commission file number 0-1026

WHITNEY HOLDING CORPORATION

(Exact name of registrant as specified in its charter)

L ouisiana	72-6017893
(State or other jurisdiction of incorporation or organization)	( I.R.S. Employer Identification No.)

228 St. Charles Avenue

New Orleans, Louisiana 70130

(Address of principal executive offices)

(504) 586-7272

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ü No __

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ü No __

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ü	Accelerated filer __
Non-accelerated filer __	Smaller reporting company __

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes __ No ü

As of April 30, 2011, 96,657,361 shares of the registrant’s no par value common stock were outstanding.

WHITNEY HOLDING CORPORATION

TABLE OF CONTENTS

			Page
PART I.	Financial Information

	Item 1.	Financial Statements:
		Consolidated Balance Sheets	1
		Consolidated Statements of Income	2
		Consolidated Statements of Changes in Shareholders’ Equity	3
		Consolidated Statements of Cash Flows	4
		Notes to Consolidated Financial Statements	5
		Selected Financial Data	32

	Item 2.	Management’s Discussion and Analysis of Financial
		Condition and Results of Operations	33

	Item 3.	Quantitative and Qualitative Disclosures about Market Risk	58

	Item 4.	Controls and Procedures	58

PART II.	Other Information

	Item 1.	Legal Proceedings	59

	Item 1A.	Risk Factors	59

	Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	62

	Item 3.	Defaults upon Senior Securities	62

	Item 4.	Reserved	62

	Item 5.	Other Information	62

	Item 6.	Exhibits	62


Signature			63

Exhibit Index			64

FORWARD-LOOKING STATEMENTS

This quarterly report on Form 10-Q, and other periodic reports filed by Whitney Holding Corporation (“Whitney”) with the SEC, may include “forward-looking statements” within the meaning of the “safe harbor” provided by section 27A of the Securities Act of 1933, as amended, and section 21E of the Securities Exchange Act of 1934. These statements are intended to be covered by the safe harbor. Forward-looking statements provide projections of results of operations or of financial condition or state other forward-looking information, such as expectations about future conditions and descriptions of plans and strategies for the future. Forward-looking statements often contain words such as “anticipate,” “believe,” “could,” “continue,” “estimate,” “expect,” “forecast,” “goal,” “intend,” “plan,” “predict,” “project” or other words of similar meaning.

Whitney’s ability to accurately project results or predict the effects of plans or strategies is inherently limited. Although Whitney believes that the expectations reflected in its forward-looking statements are based on reasonable assumptions, actual results and performance could differ materially from those set forth in the forward-looking statements.

Factors that could cause actual results to differ from those expressed in the Company’s forward-looking statements include, but are not limited to:

·	the deterioration of general economic and business conditions in the United States and in the regions and the communities Whitney serves;

·	fluctuations in the market price of Hancock Holding Company (Hancock) common stock and the related effect on the market value of the merger consideration that Whitney common shareholders will receive upon completion of the proposed merger with Hancock;

·	the possibility that the proposed merger with Hancock does not close when expected or at all because required regulatory or other approvals and conditions to closing are not received or satisfied on a timely basis or at all;

·	diversion of Whitney’s management time on merger related issues;

·	further declines in the values of residential and commercial real estate, which may increase Whitney’s credit losses;

·	Whitney’s ability to effectively manage interest rate risk and other market risk, credit risk, operational risk, legal risk, liquidity risk, and regulatory and compliance risk;

·	changes in interest rates that affect the pricing of Whitney’s financial products, the demand for its financial services and the valuation of its financial assets and liabilities;

·	Whitney’s ability to manage fluctuations in the value of its assets and liabilities and off-balance sheet exposure so as to maintain sufficient capital and liquidity to support its business;

·	Whitney’s ability to manage disruptions in the credit and lending markets, including the impact on its business and on the businesses of its customers as well as other financial institutions with which Whitney has commercial relationships;

·	Whitney’s ability to comply with any requirements imposed on the Company and Whitney National Bank (the Bank) by their respective regulators, and the potential negative consequences that may result;

·	the occurrence of natural disasters or acts of war or terrorism that directly or indirectly affect the financial health of Whitney’s customer base;

·	changes in laws and regulations, including increases in regulatory capital requirements, that significantly affect the activities of the banking industry and its competitive position relative to other financial service providers;

·	technological changes affecting the nature or delivery of financial products or services and the cost of providing them;

·	Whitney’s ability to develop competitive new products and services in a timely manner and the acceptance of such products and services by the Bank’s customers;

·	Whitney’s ability to effectively expand into new markets;

·	the cost and other effects of material contingencies, including litigation contingencies;

·	the failure to attract or retain key personnel;

·	the failure to capitalize on growth opportunities and to realize cost savings in connection with business acquisitions;

·	the effectiveness of Whitney’s responses to unexpected changes; and

·	those other factors identified and discussed in this quarterly report on Form 10-Q and in Whitney’s other public filings with the SEC.

You are cautioned not to place undue reliance on these forward-looking statements. Whitney does not intend, and undertakes no obligation, to update or revise any forward-looking statements, whether as a result of differences in actual results, changes in assumptions or changes in other factors affecting such statements, except as required by law.

See also Item 1A, “Risk Factors,” of Part II of this Form 10-Q, and Item 1A of Part I of Whitney’s annual report on Form 10-K for the year ended December 31, 2010.

PART 1. FINANCIAL INFORMATION

Item 1. FINANCIAL STATEMENTS

WHITNEY HOLDING CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
	March 31			December 31
(dollars in thousands)	2011			2010
	(Unaudited)
ASSETS
Cash and due from financial institutions	$	264,233		$	210,368
Federal funds sold and short-term investments		432,432			445,392
Loans held for sale		68,999			198,351
Investment securities
Securities available for sale		2,008,911			1,968,245
Securities held to maturity, fair values of $675,233 and $638,195, respectively		676,881			641,357
Total investment securities		2,685,792			2,609,602
Loans, net of unearned income		6,993,353			7,234,726
Allowance for loan losses		(214,186	)		(216,843	)
Net loans		6,779,167			7,017,883

Bank premises and equipment		232,591			232,475
Goodwill		435,678			435,678
Other intangible assets		7,976			8,922
Accrued interest receivable		29,022			29,078
Other assets		560,184			611,030
Total assets	$	11,496,074		$	11,798,779

LIABILITIES
Noninterest-bearing demand deposits	$	3,625,043		$	3,523,518
Interest-bearing deposits		5,556,777			5,879,885
Total deposits		9,181,820			9,403,403

Short-term borrowings		468,628			543,492
Long-term debt		219,612			219,571
Accrued interest payable		10,372			9,722
Accrued expenses and other liabilities		77,029			98,257
Total liabilities		9,957,461			10,274,445

SHAREHOLDERS' EQUITY
Preferred stock, no par value
Authorized, 20,000,000 shares; issued and outstanding, 300,000 shares		296,559			296,242
Common stock, no par value
Authorized - 200,000,000 shares
Issued - 97,153,720 and 97,142,069 shares, respectively		2,800			2,800
Capital surplus		621,803			620,547
Retained earnings		640,654			628,546
Accumulated other comprehensive income (loss)		(10,506	)		(11,104	)
Treasury stock at cost - 500,000 shares		(12,697	)		(12,697	)
Total shareholders' equity		1,538,613			1,524,334
Total liabilities and shareholders' equity	$	11,496,074		$	11,798,779
The accompanying notes are an integral part of these financial statements.

WHITNEY HOLDING CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
	Three Months Ended
	March 31
(dollars in thousands, except per share data)	2011		2010
INTEREST INCOME
Interest and fees on loans	$	86,446	$	100,130
Interest and dividends on investment securities
Taxable securities		21,459		18,817
Tax-exempt securities		1,427		1,685
Interest on federal funds sold and short-term investments		233		179
Total interest income		109,565		120,811
INTEREST EXPENSE
Interest on deposits		6,759		11,420
Interest on short-term borrowings		173		276
Interest on long-term debt		2,761		2,486
Total interest expense		9,693		14,182
NET INTEREST INCOME		99,872		106,629
PROVISION FOR CREDIT LOSSES		-		37,500
NET INTEREST INCOME AFTER PROVISION
FOR CREDIT LOSSES		99,872		69,129
NONINTEREST INCOME
Service charges on deposit accounts		7,962		8,482
Bank card fees		6,553		5,674
Trust service fees		3,055		2,908
Secondary mortgage market operations		1,882		1,882
Other noninterest income		10,986		9,301
Securities transactions		-		-
Total noninterest income		30,438		28,247
NONINTEREST EXPENSE
Employee compensation		40,930		39,044
Employee benefits		10,493		11,051
Total personnel		51,423		50,095
Net occupancy		9,424		9,945
Equipment and data processing		7,433		6,594
Legal and other professional services		7,140		5,232
Deposit insurance and regulatory fees		5,658		6,013
Telecommunication and postage		2,808		3,085
Corporate value and franchise taxes		1,404		1,698
Amortization of intangibles		946		1,495
Provision for valuation losses on foreclosed assets		5,631		3,088
Nonlegal loan collection and other foreclosed asset costs		1,329		3,173
Merger transaction expense		1,166		-
Other noninterest expense		13,766		19,288
Total noninterest expense		108,128		109,706
INCOME (LOSS) BEFORE INCOME TAXES		22,182		(12,330	)
INCOME TAX EXPENSE (BENEFIT)		5,027		(6,050	)
NET INCOME (LOSS)	$	17,155	$	(6,280	)
Preferred stock dividends		4,067		4,067
NET INCOME (LOSS) TO COMMON SHAREHOLDERS	$	13,088	$	(10,347	)
EARNINGS (LOSS) PER COMMON SHARE
Basic	$	.13	$	(.11	)
Diluted		.13		(.11	)
WEIGHTED-AVERAGE COMMON SHARES OUTSTANDING
Basic		96,728,115		96,534,425
Diluted		96,728,115		96,534,425
CASH DIVIDENDS PER COMMON SHARE	$	.01	$	.01
The accompanying notes are an integral part of these financial statements.

WHITNEY HOLDING CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
(Unaudited)

					Common					Accumulated
					Stock and					Other
	Preferred		Common		Capital		Retained			Comprehensive			Treasury
(dollars and shares in thousands, except per share data)	Stock		Shares		Surplus		Earnings			Income (Loss)			Stock			Total
Balance at December 31, 2009	$	294,974		96,447	$	619,838	$	790,481		$	(11,532	)	$	(12,697	)	$	1,681,064
Comprehensive income (loss):
Net loss		-		-		-		(6,280	)		-			-			(6,280	)
Other comprehensive income:
Unrealized net holding gain on securities,
net of reclassifications and tax		-		-		-		-			4,075			-			4,075
Net change in prior service cost or credit and
net actuarial loss on retirement plans, net of tax		-		-		-		-			753			-			753
Total comprehensive income (loss)		-		-		-		(6,280	)		4,828			-			(1,452	)
Common stock dividends, $.01 per share		-		-		-		(976	)		-			-			(976	)
Preferred stock dividend and discount accretion		317		-		-		(4,067	)		-			-			(3,750	)
Common stock issued to dividend reinvestment plan		-		5		49		-			-			-			49
Employee incentive plan common stock activity		-		-		1,296		-			-			-			1,296
Director compensation plan common stock activity		-		8		9		-			-			-			9
Balance at March 31, 2010	$	295,291		96,460	$	621,192	$	779,158		$	(6,704	)	$	(12,697	)	$	1,676,240

Balance at December 31, 2010	$	296,242		96,642	$	623,347	$	628,546		$	(11,104	)	$	(12,697	)	$	1,524,334
Comprehensive income:
Net income		-		-		-		17,155			-			-			17,155
Other comprehensive income:
Unrealized net holding gain on securities,
net of reclassifications and tax		-		-		-		-			218			-			218
Net change in prior service cost or credit and
net actuarial loss on retirement plans, net of tax		-		-		-		-			380			-			380
Total comprehensive income		-		-		-		17,155			598			-			17,753
Common stock dividends, $.01 per share		-		-		-		(980	)		-			-			(980	)
Preferred stock dividend and discount accretion		317		-		-		(4,067	)		-			-			(3,750	)
Common stock issued to dividend reinvestment plan		-		3		42		-			-			-			42
Employee incentive plan common stock activity		-		-		1,208		-			-			-			1,208
Director compensation plan common stock activity		-		9		6		-			-			-			6
Balance at March 31, 2011	$	296,559		96,654	$	624,603	$	640,654		$	(10,506	)	$	(12,697	)	$	1,538,613

The accompanying notes are an integral part of these financial statements.

WHITNEY HOLDING CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
	Three Months Ended
	March 31
(dollars in thousands)	2011			2010
OPERATING ACTIVITIES
Net income (loss)	$	17,155		$	(6,280	)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization of bank premises and equipment		6,024			5,222
Amortization of purchased intangibles		946			1,495
Share-based compensation earned		1,206			1,293
Premium amortization and discount accretion on securities, net		2,424			760
Provision for credit losses and losses on foreclosed assets and loans held for sale		6,870			40,588
Net (gains) losses on asset dispositions		(4,024	)		263
Deferred tax expense (benefit)		6,005			(3,844	)
Net decrease in loans originated and held for sale		28,526			10,803
Net (increase) decrease in interest and other income receivable and prepaid expenses		27,189			(732	)
Net increase (decrease) in interest payable and accrued income taxes and expenses		(11,039	)		2,726
Other, net		(1,163	)		(1,004	)
Net cash provided by operating activities		80,119			51,290
INVESTING ACTIVITIES
Proceeds from maturities of investment securities available for sale		141,802			144,516
Purchases of investment securities available for sale		(183,972	)		(136,319	)
Proceeds from maturities of investment securities held to maturity		14,270			10,265
Purchases of investment securities held to maturity		(50,379	)		-
Net decrease in loans		226,488			275,890
Proceeds from sales and other dispositions of loans reclassified as held for sale		100,459			-
Net (increase) decrease in federal funds sold and short-term investments		12,960			(44,286	)
Proceeds from sales of foreclosed assets and surplus property		10,170			7,273
Purchases of bank premises and equipment		(6,209	)		(8,053	)
Other, net		9,213			(1,238	)
Net cash provided by investing activities		274,802			248,048
FINANCING ACTIVITIES
Net decrease in transaction account and savings account deposits		(156,062	)		(168,790	)
Net decrease in time deposits		(65,521	)		(19,116	)
Net decrease in short-term borrowings		(74,864	)		(124,262	)
Proceeds from issuance of long-term debt		55			77
Repayment of long-term debt		(12	)		(11	)
Proceeds from issuance of common stock		42			49
Purchases of common stock		(2	)		-
Cash dividends on common stock		(946	)		(973	)
Cash dividends on preferred stock		(3,750	)		(3,750	)
Other, net		4			3
Net cash used in financing activities		(301,056	)		(316,773	)
Increase (decrease) in cash and cash equivalents		53,865			(17,435	)
Cash and cash equivalents at beginning of period		210,368			216,347
Cash and cash equivalents at end of period	$	264,233		$	198,912

Cash received during the period for:
Interest income	$	110,512		$	119,224

Cash paid (refund received) during the period for:
Interest expense	$	9,011		$	13,541
Income taxes		(26,780	)		-

Noncash investing activities:
Foreclosed assets received in settlement of loans	$	5,448		$	18,362

The accompanying notes are an integral part of these financial statements.

WHITNEY HOLDING CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

NOTE 1

BASIS OF PRESENTATION

The consolidated financial statements include the accounts of Whitney Holding Corporation and its subsidiaries (the Company or Whitney). The Company’s principal subsidiary is Whitney National Bank (the Bank), which represents virtually all of the Company’s operations and net income. All significant intercompany balances and transactions have been eliminated.

In preparing the consolidated financial statements, the Company is required to make estimates, judgments and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates. The consolidated financial statements reflect all adjustments that are, in the opinion of management, necessary for a fair statement of Whitney’s financial condition, results of operations, changes in shareholders’ equity and cash flows for the interim periods presented. These adjustments are of a normal recurring nature and include appropriate estimated provisions.

Pursuant to the rules and regulations of the Securities and Exchange Commission (SEC), some financial information and disclosures have been condensed or omitted in preparing the consolidated financial statements presented in this quarterly report on Form 10-Q. These financial statements should be read in conjunction with the Company’s annual report on Form 10-K for the year ended December 31, 2010, as amended. Financial information reported in these financial statements is not necessarily indicative of the Company’s financial condition, results of operations or cash flows of any other interim or annual periods.

NOTE 2

PROPOSED MERGER WITH HANCOCK HOLDING COMPANY

On December 22, 2010, Whitney and Hancock Holding Company (Hancock) announced a strategic business combination in which Whitney will merge with and into Hancock. If the merger is completed, holders of Whitney common stock will receive .418 of a share of Hancock common stock in exchange for each share of Whitney common stock held immediately prior to the merger, subject to the payment of cash in lieu of fractional shares. On April 29, 2011, the shareholders of both Whitney and Hancock voted to approve the merger agreement. Consummation of the merger is contingent upon regulatory approvals and other closing conditions.

NOTE 3

INVESTMENT SECURITIES

Summary information about securities available for sale and securities held to maturity follows. Mortgage-backed securities are issued or guaranteed by U.S. government agencies and substantially all are backed by residential mortgage loans.

	Amortized		Unrealized		Unrealized		Fair
(in thousands)	Cost		Gains		Losses		Value
Securities Available for Sale
March 31, 2011
Mortgage-backed securities	$	1,897,847	$	43,028	$	7,836	$	1,933,039
U. S. agency securities		18,566		-		216		18,350
Obligations of states and political subdivisions		4,261		224		-		4,485
Other securities		53,037		-		-		53,037
Total	$	1,973,711	$	43,252	$	8,052	$	2,008,911
December 31, 2010
Mortgage-backed securities	$	1,861,026	$	43,869	$	8,946	$	1,895,949
U. S. agency securities		18,633		-		285		18,348
Obligations of states and political subdivisions		4,895		230		3		5,122
Other securities		48,826		-		-		48,826
Total	$	1,933,380	$	44,099	$	9,234	$	1,968,245
Securities Held to Maturity
March 31, 2011
Mortgage-backed securities	$	433,839	$	41	$	4,202	$	429,678
Obligations of states and political subdivisions		143,042		4,027		84		146,985
Corporate debt securities		100,000		-		1,430		98,570
Total	$	676,881	$	4,068	$	5,716	$	675,233
December 31, 2010
Mortgage-backed securities	$	395,177	$	-	$	5,482	$	389,695
Obligations of states and political subdivisions		146,180		4,029		255		149,954
Corporate debt securities		100,000		-		1,454		98,546
Total	$	641,357	$	4,029	$	7,191	$	638,195

The following summarizes securities with unrealized losses at March 31, 2011 and December 31, 2010 by the period over which the security’s fair value had been continuously less than its amortized cost as of each date.

March 31, 2011	Less than 12 Months				12 Months or Longer
	Fair		Unrealized		Fair		Unrealized
(in thousands)	Value		Losses		Value		Losses
Securities Available for Sale
Mortgage-backed securities	$	471,848	$	7,836	$	-	$	-
U.S. agency securities		18,350		216		-		-
Total	$	490,198	$	8,052	$	-	$	-
Securities Held to Maturity
Mortgage-backed securities	$	391,730	$	4,202	$	-	$	-
Obligations of states and political subdivisions		4,294		84		-		-
Corporate debt securities		98,570		1,430		-		-
Total	$	494,594	$	5,716	$	-	$	-

December 31, 2010	Less than 12 Months				12 Months or Longer
	Fair		Unrealized		Fair		Unrealized
(in thousands)	Value		Losses		Value		Losses
Securities Available for Sale
Mortgage-backed securities	$	409,483	$	8,946	$	-	$	-
U.S. agency securities		18,348		285		-		-
Obligations of states and political subdivisions		300		2		206		1
Total	$	428,131	$	9,233	$	206	$	1
Securities Held to Maturity
Mortgage-backed securities	$	389,696	$	5,482	$	-	$	-
Obligations of states and political subdivisions		6,187		255		-		-
Corporate debt securities		83,546		1,454		-		-
Total	$	479,429	$	7,191	$	-	$	-

Management evaluates whether unrealized losses on securities represent impairment that is other than temporary. If such impairment is identified, the carrying amount of the security is reduced with a charge to operations or other comprehensive income. In making this evaluation, management first considers the reasons for the indicated impairment. These could include changes in market rates relative to those available when the security was acquired, changes in market expectations about the timing of cash flows from securities that can be prepaid, and changes in the market’s perception of the issuer’s financial health and the security’s credit quality. Management then considers the likelihood of a recovery in fair value sufficient to eliminate the indicated impairment and the length of time over which an anticipated recovery would occur, which could extend to the security’s maturity. Finally, management determines whether there is both the ability and the intent to hold the impaired security until an anticipated recovery, in which case the impairment would be considered temporary. In making this assessment, management considers whether the security continues to be a suitable holding from the perspective of the Company’s overall portfolio and asset/liability management strategies and whether there are other circumstances that would more likely than not require the sale of the security.

Substantially all the unrealized losses at March 31, 2011 resulted from increases in market interest rates over the yields available at the time the underlying securities were purchased. Management identified no impairment related to credit quality. In all cases, the indicated impairment would be recovered by the security’s maturity or repricing date or possibly earlier if the market price for the security increases with a reduction in the yield required by the market. At March 31, 2011, management had both the intent and ability to hold these securities until the market-based impairment is recovered.

The following table shows the amortized cost and estimated fair value of debt securities available for sale and held to maturity grouped by contractual maturity as of March 31, 2011. Debt securities with scheduled repayments, such as mortgage-backed securities, are presented in separate totals. The expected maturity of a security, in particular certain U.S. agency securities and obligations of states and political subdivisions, may differ from its contractual maturity because of the exercise of call options.

	Amortized		Fair
(in thousands)	Cost		Value
Securities Available for Sale
Within one year	$	749	$	756
One to five years		6,208		6,354
Five to ten years		19,620		19,475
After ten years		-		-
Debt securities with single maturities		26,577		26,585
Mortgage-backed securities		1,897,847		1,933,039
Total debt securities	$	1,924,424	$	1,959,624
Securities Held to Maturity
Within one year	$	15,377	$	15,487
One to five years		161,217		161,795
Five to ten years		46,714		48,056
After ten years		19,734		20,217
Debt securities with single maturities		243,042		245,555
Mortgage-backed securities		433,839		429,678
Total debt securities	$	676,881	$	675,233

Securities with carrying values of $1.17 billion at March 31, 2011 and $1.42 billion at December 31, 2010 were sold under repurchase agreements, pledged to secure public deposits or pledged for other purposes.

NOTE 4

LOANS HELD FOR SALE

Loans held for sale consisted of the following.

	March 31	December 31
(in thousands)	2011	2010
Residential mortgage loans originated for sale	$ 11,780	$ 40,306
Nonperforming loans reclassified as held for sale	57,219	158,045
Total loans held for sale	$68,999	$198,351

Residential mortgage loans originated for sale are carried at the lower of either cost or estimated fair value. Substantially all of these loans are originated under individual purchase commitments from investors.

During the fourth quarter of 2010, the Bank implemented a strategy to accelerate the disposition of problem assets and, as a result, reclassified approximately $303 million of nonperforming loans as held for sale. The Bank recorded $139 million of charge-offs in the fourth quarter of 2010 to record these loans at the lower of cost or estimated fair value. In January 2011, the Company closed on a bulk sale of $83 million in carrying value of nonperforming loans held for sale in addition to various individual sales and other dispositions. No additional nonperforming loans were reclassified as held for sale during the first quarter of 2011.

NOTE 5

LOANS

The composition of the Company’s loan portfolio follows.

	March 31 December 31
(in thousands)	2011				2010
Commercial & industrial	$	2,644,404	38	%	$	2,789,193	38	%
Owner-occupied real estate		1,061,905	15			1,003,162	14
Total commercial & industrial		3,706,309	53			3,792,355	52
Construction, land & land development		879,590	13			945,896	13
Other commercial real estate		1,016,812	14			1,122,950	16
Total commercial real estate		1,896,402	27			2,068,846	29
Residential mortgage		978,793	14			952,847	13
Consumer		411,849	6			420,678	6
Total	$	6,993,353	100	%	$	7,234,726	100	%

NOTE 6

CREDIT RISK MANAGEMENT, ALLOWANCE FOR LOAN LOSSES AND RESERVE FOR LOSSES ON UNFUNDED CREDIT COMMITMENTS, AND CREDIT QUALITY INDICATORS

Credit Risk Management

Whitney manages credit risk mainly through adherence to underwriting and loan administration standards established by the Bank’s Credit Policy Committee and through the efforts of the credit administration function to ensure consistent application and monitoring of standards throughout the Company. Written credit policies define underwriting criteria, concentration guidelines, and lending approval processes that cover individual authority as well as the involvement of senior and regional credit officers and the senior loan committee. The senior loan committee includes select commercial lending executives, senior officers in Credit Administration, the Chief Credit Officer, the President and the Chief Executive Officer.

Commercial and industrial (C&I) credits and commercial real estate (CRE) loans are underwritten principally based upon cash flow coverage, but additional support is regularly obtained through collateralization and guarantees. C&I loans are typically relationship-based rather than transaction-driven. Loan concentrations are monitored monthly by management and the Board of Directors. Consumer loans, including most residential mortgages and other consumer borrowings, are centrally underwritten with reference to the customer’s debt capacity and with the support of automated credit scoring tools, including appropriate secondary review procedures.

Lending officers are primarily responsible for ongoing monitoring and the assignment of risk ratings to individual loans based on established guidelines. An independent credit review function, which reports to the Audit Committee of the Board of Directors, assesses the accuracy of officer ratings and the timeliness of rating changes and performs reviews of the underwriting processes. Once a problem relationship over a certain size threshold is identified, a monthly watch committee process is initiated. The watch committee, composed of senior lending and credit administration management as well as the Chief Executive Officer and Chief Risk Officer, must approve any substantive changes to identified problem credits and will assign relationships to a special credits department when appropriate.

Allowance for Loan Losses and Reserve for Losses on Unfunded Commitments

Management’s evaluation of credit risk in the loan portfolio is reflected in the estimate of probable losses inherent in the portfolio that is reported in the Company’s financial statements as the allowance for loan losses. Changes in this evaluation over time are reflected in the provision for credit losses charged to expense. As actual loan losses are incurred, they are charged against the allowance. Subsequent recoveries are added back to the allowance when collected. The methodology for determining the allowance involves significant judgment, and important factors that influence this judgment are re-evaluated by management quarterly to respond to changing conditions.

A summary analysis of changes in the allowance for loan losses by loan portfolio class follows. Information on loan balances excludes loans reclassified as held for sale (see Note 4).

	Commercial			Commercial			Residential
(in thousands)	& Industrial			Real Estate			Mortgage			Consumer			Unallocated			Total
Three months ended March 31, 2011
Beginning allowance	$	73,656		$	103,172		$	20,833		$	14,182		$	5,000		$	216,843
Provision for credit losses		10,900			(11,617	)		4,007			1,710			(5,000	)		-
Loans charged off		(4,392	)		(6,994	)		(3,062	)		(1,659	)		-			(16,107	)
Recoveries		4,308			8,451			415			276			-			13,450
Net (charge-offs) recoveries		(84	)		1,457			(2,647	)		(1,383	)		-			(2,657	)
Ending allowance	$	84,472		$	93,012		$	22,193		$	14,509		$	-		$	214,186

Allowance at end of period:
Loans individually evaluated
for impairment	$	1,432		$	1,162		$	905		$	-					$	3,499
Loans collectively evaluated
for impairment		83,040			91,850			21,288			14,509						210,687

Loans at end of period:
Loans individually evaluated
for impairment	$	31,611		$	56,985		$	9,974		$	337					$	98,907
Loans collectively evaluated
for impairment		3,674,698			1,839,417			968,819			411,512						6,894,446
Total loans	$	3,706,309		$	1,896,402		$	978,793		$	411,849					$	6,993,353
Three months ended March 31, 2010
Beginning allowance	$	71,971		$	113,829		$	27,550		$	10,321		$	-		$	223,671
Provision for credit losses		6,617			22,414			4,727			3,542			-			37,300
Loans charged off		(13,136	)		(21,218	)		(4,129	)		(1,504	)		-			(39,987	)
Recoveries		1,252			1,186			253			215			-			2,906
Net charge-offs		(11,884	)		(20,032	)		(3,876	)		(1,289	)		-			(37,081	)
Ending allowance	$	66,704		$	116,211		$	28,401		$	12,574		$	-		$	223,890

Allowance at end of period:
Loans individually evaluated
for impairment	$	9,352		$	33,691		$	4,252		$	392					$	47,687
Loans collectively evaluated
for impairment		57,352			82,520			24,149			12,182						176,203

Loans at end of period:
Loans individually evaluated
for impairment	$	60,933		$	262,103		$	38,606		$	1,295					$	362,937
Loans collectively evaluated
for impairment		3,877,464			2,433,832			976,376			422,889						7,710,561
Total loans	$	3,938,397		$	2,695,935		$	1,014,982		$	424,184					$	8,073,498

The process for determining the recorded allowance involves three key elements: (1) establishing specific allowances as needed for loans evaluated for impairment; (2) developing loss factors based on historical loss experience for nonimpaired commercial loans grouped by geography, loan product type and internal risk rating and for homogeneous groups of residential and consumer loans; and (3) determining appropriate adjustments to historical loss factors based on management’s assessment of current economic conditions and other qualitative risk factors both internal and external to the Company.

The historical loss factors for commercial loans are determined with reference to the results of migration analysis, which analyzes the charge-off experience over time for loans within each grouping. The historical loss factors for homogeneous loan groups are based on average historical charge-off information. Management adjusts historical loss factors based on its assessment of whether current conditions, both internal and external, would be adequately reflected in these factors. Internally, management must consider such matters as whether trends have been identified in the quality of underwriting and loan administration as well as in the timely identification of credit quality issues. Management also monitors shifts in portfolio concentrations and other changes in portfolio characteristics that indicate levels of risk not fully captured in the loss factors. External factors include local and national economic trends, as well as changes in the economic fundamentals of specific industries that are well-represented in Whitney’s customer base. Applying the adjusted loss factors to the corresponding loan groups yields an allowance that represents management’s best estimate of probable losses. Management has established policies and procedures to help ensure a consistent approach to this inherently judgmental process.

A loan is considered impaired when it is probable that all contractual amounts will not be collected as they come due. Specific allowances are determined for impaired loans based on the present value of expected future cash flows discounted at the loan’s contractual interest rate, the fair value of the collateral if the loan is collateral dependent, or, when available, the loan’s observable market price. As an administrative matter, this process is applied only to impaired loans or relationships in excess of $1 million. The most probable source of repayment for the majority of the Company’s impaired loans at March 31, 2011 and December 31, 2010 was from liquidation of the underlying real estate collateral, and such loans have been deemed to be collateral dependent.

Third-party property appraisals are obtained prior to the origination of loans secured by real estate. Updated appraisals are obtained when certain events occur, such as the refinancing of the loan, the renewal of the loan or if the credit quality of the loan deteriorates. Changes in collateral value can affect a loan’s risk rating or its impairment evaluation and thereby impact the allowance for credit losses. Whitney’s policy is to recognize a loan charge-off promptly when the collection of the loan is sufficiently questionable based on the current assessment of the present and future cash flow potential available to liquidate the debt. The Bank generally uses a third-party appraisal when assessing collateral value for the purpose of determining the need for and amount of a charge-off. At foreclosure, a new appraisal is obtained and the foreclosed property is recorded at the new valuation less estimated selling costs.

The type of valuation methodology used to support the value of the collateral is based on property-specific facts and circumstances, including the nature of the real estate and the disposition strategy being employed. In all cases, an “as-is” value is determined; however, other valuation methodologies may also be used. For example, “upon completion” value or “upon

stabilization” value may be used when a borrower has funds available to complete construction of a project, whereas an “as-is” value would be used for partially developed property for which a borrower has insufficient funds to complete the project. “As-is” values are generally used for nonperforming and impaired loans. Retail value may be used for a completed single-family home, but a discounted retail valuation would be used for a multi-lot subdivision with sales extending over a period of time. Appraisals representing a bulk sale of multiple parcels or condominiums that reflect a discount may be used when individual retail sales are not anticipated in the near term.

While appraisals are obtained annually for problem credits, Whitney monitors factors that can positively or negatively impact property values until updated appraisals are received, such as the date of the last valuation, the volatility of property values in specific markets, changes in the value of similar properties and changes in the characteristics of individual properties. As property values declined in recent years, especially for real estate serving as collateral for land, land development and construction loans in some of Whitney’s market areas, appraisals have generally been discounted for impairment analysis purposes based on how recently the appraisal was completed. In determining the discounts applied, Whitney considered market-based information, including actual changes in real property values indicated by new appraisals received on loan collateral and on real property obtained through foreclosure, market intelligence obtained by lending officers and foreclosed property managers and market statistics monitored by credit review personnel. Appraisals less than six months old were discounted 10%, primarily reflecting estimated selling costs. A 20% discount was applied to appraisals greater than six months old but less than one year old. These discounts were consistently applied to properties in Whitney’s Florida and Alabama markets, but were reduced for certain properties in other markets based on property-specific circumstances.

The monitoring of credit risk also extends to unfunded credit commitments, such as unused commercial credit lines and letters of credit, and management establishes reserves as needed for its estimate of probable losses on such commitments.

A summary analysis of changes in the reserve for losses on unfunded credit commitments follows. The reserve is reported with accrued expenses and other liabilities in the consolidated balance sheets.

	Three Months Ended
	March 31
(in thousands)	2011		2010
Reserve at beginning of period	$	1,600	$	2,200
Provision for credit losses		-		200
Reserve at end of period	$	1,600	$	2,400

Credit Quality Statistics

Past Due and Nonaccrual Loans and Loans Individually Evaluated for Impairment

A loan is considered past due or delinquent when a contractual principal or interest payment is not received by the due date. The following tables provides an aging of past due loans by class of loan as of March 31, 2011 and December 31, 2010.

March 31, 2011	Past Due												Over 90
		30-59		60-89	Over						Total		days and
(in thousands)	days		days		90 days		Total		Current		Loans		accruing
Commercial & industrial	$	4,749	$	1,919	$	9,148	$	15,816	$	2,628,588	$	2,644,404	$	2,483
Owner-occupied real estate		3,344		8,983		15,790		28,117		1,033,788		1,061,905		989
Total commercial & industrial		8,093		10,902		24,938		43,933		3,662,376		3,706,309		3,472
Construction, land &
land development		8,382		3,880		25,904		38,166		841,424		879,590		1,049
Other commercial real estate		5,390		5,825		14,832		26,047		990,765		1,016,812		3,613
Total commercial real estate		13,772		9,705		40,736		64,213		1,832,189		1,896,402		4,662
Residential mortgage		15,714		5,750		18,124		39,588		939,205		978,793		883
Consumer		1,244		709		1,610		3,563		408,286		411,849		1,218
Total	$	38,823	$	27,066	$	85,408	$	151,297	$	6,842,056	$	6,993,353	$	10,235

December 31, 2010	Past Due												Over 90
		30-59		60-89	Over						Total		days and
(in thousands)	days		days		90 days		Total		Current		Loans		accruing
Commercial & industrial	$	4,474	$	3,855	$	11,079	$	19,408	$	2,769,785	$	2,789,193	$	6,210
Owner-occupied real estate		15,225		7,379		11,280		33,884		969,278		1,003,162		1,798
Total commercial & industrial		19,699		11,234		22,359		53,292		3,739,063		3,792,355		8,008
Construction, land &
land development		5,249		2,243		24,326		31,818		914,078		945,896		1,635
Other commercial real estate		12,729		3,792		5,255		21,776		1,101,174		1,122,950		1,016
Total commercial real estate		17,978		6,035		29,581		53,594		2,015,252		2,068,846		2,651
Residential mortgage		14,568		9,342		17,260		41,170		911,677		952,847		1,282
Consumer		2,078		769		2,523		5,370		415,308		420,678		2,342
Total	$	54,323	$	27,380	$	71,723	$	153,426	$	7,081,300	$	7,234,726	$	14,283

The Company stops accruing interest on a loan when the borrower’s ability to meet contractual payments is in doubt. For commercial and real estate loans, a loan is placed on nonaccrual status generally when it is ninety days past due as to principal or interest and the loan is not otherwise both well secured and in the process of collection. A loan may, however, be placed on nonaccrual status regardless of its past due status. A loan on nonaccrual status may be reinstated to accrual status when full payment of contractual principal and interest is expected and this expectation is supported by current sustained performance.

The totals for loans on nonaccrual status by class of loan were as follows.

	March 31		December 31
(in thousands)	2011		2010
Commercial & industrial	$	23,299	$	20,859
Owner-occupied real estate		24,760		20,533
Total commercial & industrial		48,059		41,392
Construction, land & land development		54,471		42,631
Other commercial real estate		28,606		18,364
Total commercial real estate		83,077		60,995
Residential mortgage		42,147		36,807
Consumer		1,201		1,325
Total nonaccrual loans	$	174,484	$	140,519

Information on loans individually evaluated for possible impairment loss at March 31, 2011 and December 31, 2010 follows. Substantially all of the impaired loans summarized below are included in the nonaccrual loan totals presented above. No interest has been recognized on impaired loans in nonaccrual status. The recorded investment in impaired loans at March 31, 2011 also included $7.2 million for a loan in accrual status that had been subject to a troubled debt restructuring. The interest recognized on this loan during the first quarter of 2011 was insignificant. Overall, the total for restructured troubled loans held for investment was not material at either March 31, 2011 or December 30, 2010.

	Unpaid		Recorded		Recorded
	Contractual		Investment		Investment		Total
	Principal		with no		with an		Recorded		Related
(in thousands)	Balance		Allowance		Allowance		Investment		Allowance
March 31, 2011
Commercial & industrial	$	12,675	$	8,176	$	4,499	$	12,675	$	1,432
Owner-occupied real estate		18,936		10,324		8,612		18,936		-
Total commercial & industrial		31,611		18,500		13,111		31,611		1,432
Construction, land &
land development		40,916		30,022		4,909		34,931		473
Other commercial real estate		26,535		19,754		2,300		22,054		689
Total commercial real estate		67,451		49,776		7,209		56,985		1,162
Residential mortgage		10,135		6,225		3,749		9,974		905
Consumer		734		337		-		337		-
Total	$	109,931	$	74,838	$	24,069	$	98,907	$	3,499
December 31, 2010
Commercial & industrial	$	10,027	$	9,682	$	345	$	10,027	$	25
Owner-occupied real estate		11,435		9,299		2,136		11,435		128
Total commercial & industrial		21,462		18,981		2,481		21,462		153
Construction, land &
land development		27,112		15,524		6,874		22,398		824
Other commercial real estate		19,735		12,442		1,829		14,271		817
Total commercial real estate		46,847		27,966		8,703		36,669		1,641
Residential mortgage		5,300		4,555		-		4,555		-
Consumer		645		429		-		429		-
Total	$	74,254	$	51,931	$	11,184	$	63,115	$	1,794

The average recorded investment in loans individually evaluated for impairment loss for the three months ended March 31, 2011 and 2010 was as follows.

	Three Months Ended
	March 31
(in thousands)	2011		2010
Commercial & industrial	$	11,351	$	29,966
Owner-occupied real estate		15,185		33,840
Total commercial & industrial		26,536		63,806
Construction, land &
land development		28,664		169,567
Other commercial real estate		18,163		81,154
Total commercial real estate		46,827		250,721
Residential mortgage		7,265		38,307
Consumer		383		1,132
Total	$	81,011	$	353,966

Credit Quality Indicators

As part of the credit risk management process, management monitors trends in certain credit quality indicators with primary emphasis on risk rating grades for C&I and CRE loans, and loan delinquencies for residential mortgage and consumer loans (see above for details).

The risk rating system is utilized to monitor borrower and portfolio quality trends and provides a basis for aggregating loans to analyze historical losses in calculating the allowance for loan losses. The rating reflects the level of risk posed by both the borrower’s expected performance and the transaction’s structure. All C&I and CRE loans are assigned a risk rating at loan inception and renewal, the occurrence of any significant event or at least annually. A description of the general characteristics of the Company’s risk rating grades is as follows:

Pass credits – These ratings range from high quality credits to marginal credits. High quality credits include loans to borrowers with investment grade corporate debt ratings, loans collateralized by liquid assets and loans with above average credit risk exhibiting debt service coverage well above policy criteria. Most of the Company’s C&I and CRE loans are rated satisfactory and have acceptable credit quality with debt capacity or debt service coverage that meets policy criteria and covenants and collateral that provide adequate protection from loss. Marginal credits may exhibit positive debt capacity or debt service coverage that are below loan policy criteria or are subject to fluctuations due to cyclical economic factors.

Special Mention credits – This rating is used for loans that have potential weaknesses that may result in loss if uncorrected. For example, borrowers may be experiencing negative operating trends due to adverse economic or market conditions. While loans in this category pose a higher risk of default than pass credits, default is not imminent.

·	Classified credits – This category includes substandard, doubtful and loss rated loans. Substandard loans have well-defined weaknesses that will likely result in loss if not corrected. Borrowers may have currently unprofitable operations, inadequate debt

service coverage, inadequate liquidity or marginal capitalization. Repayment may depend on collateral or other secondary sources. Full collection of principal and interest for some substandard loans may be in doubt and such loans are placed on nonaccrual status. Doubtful loans have all the weaknesses inherent in substandard loans and their full collection is highly questionable and improbable. Loss credits are loans that have been determined to be uncollectible. Both doubtful and loss loans are placed on nonaccrual status.

The following table summarizes C&I and CRE loans by risk rating at March 31, 2011 and December 31, 2010.

	Commercial &				Owner-occupied				Construction, Land &				Other Commercial
	Industrial				Real Estate				Land Development				Real Estate
	March 31		December 31		March 31		December 31		March 31		December 31		March 31		December 31
(in thousands)	2011		2010		2011		2010		2011		2010		2011		2010
Pass	$	2,367,333	$	2,510,851	$	902,905	$	834,587	$	549,648	$	615,803	$	774,024	$	869,113
Special Mention		62,528		79,432		13,975		32,211		52,292		57,980		107,521		105,544
Substandard		211,214		196,535		144,324		135,368		276,617		270,340		134,451		148,139
Doubtful		3,329		2,375		701		996		1,033		1,773		816		154
Total	$	2,644,404	$	2,789,193	$	1,061,905	$	1,003,162	$	879,590	$	945,896	$	1,016,812	$	1,122,950

NOTE 7

DEPOSITS

The composition of deposits was as follows.

	March 31		December 31
(in thousands)	2011		2010
Noninterest-bearing demand deposits	$	3,625,043	$	3,523,518
Interest-bearing deposits:
NOW account deposits		1,162,885		1,309,738
Money market deposits		1,786,266		1,913,224
Savings deposits		919,526		903,302
Other time deposits		648,847		689,301
Time deposits $100,000 and over		1,039,253		1,064,320
Total interest-bearing deposits		5,556,777		5,879,885
Total deposits	$	9,181,820	$	9,403,403

Time deposits of $100,000 or more include balances in treasury-management deposit products for commercial and certain other larger deposit customers. Balances maintained in such products totaled $227 million at March 31, 2011 and $188 million at December 31, 2010. Most of these deposits mature on a daily basis.

NOTE 8

SHORT-TERM BORROWINGS

Short-term borrowings consisted of the following.

	March 31		December 31
(in thousands)	2011		2010
Securities sold under agreements to repurchase	$	445,149	$	523,324
Federal funds purchased		16,579		13,968
Treasury Investment Program		6,900		6,200
Total short-term borrowings	$	468,628	$	543,492

The Bank borrows funds on a secured basis by selling securities under agreements to repurchase, mainly in connection with treasury-management services offered to its deposit customers. Repurchase agreements generally mature daily.

Federal funds purchased are unsecured borrowings from other banks, generally on an overnight basis.

Under the Treasury Investment Program, temporary excess U.S. Treasury receipts are loaned to participating financial institutions at 25 basis points under the federal funds rate. Repayment of these borrowed funds can be demanded at any time, and the Bank pledges securities as collateral.

From time to time, the Bank uses advances from the Federal Home Loan Bank (FHLB) as an additional source of short-term funds, although no advances were outstanding at March 31, 2011 or December 31, 2010. FHLB advances are secured by a blanket lien on Bank loans secured by real estate.

NOTE 9

OTHER ASSETS AND ACCRUED EXPENSES AND OTHER LIABILITIES

The more significant components of other assets and accrued expenses and other liabilities were as follows.

	March 31		December 31
(in thousands)	2011		2010
Other Assets
Cash surrender value of life insurance	$	182,172	$	180,329
Net deferred income tax asset		144,112		150,199
Foreclosed assets and surplus property		78,155		87,696
Prepaid FDIC insurance assessments		44,553		49,360
Recoverable income taxes		29,047		55,827
Prepaid pension asset		15,949		14,609
Other prepaid expenses		14,151		10,393
Low-income housing tax credit fund investments		6,192		6,822
Miscellaneous investments, receivables and other assets		45,853		55,795
Total other assets	$	560,184	$	611,030
Accrued Expenses and Other Liabilities
Accrued taxes and other expenses	$	20,504	$	30,302
Dividend payable		883		850
Liability for pension benefits		14,549		14,465
Liability for postretirement benefits other than pensions		15,705		15,819
Reserve for losses on unfunded credit commitments		1,600		1,600
Reserve for losses on loan repurchase obligations		250		1,750
Miscellaneous payables, deferred income and other liabilities		23,538		33,471
Total accrued expenses and other liabilities	$	77,029	$	98,257

See Note 17 for a discussion of the Company’s process for evaluating the realizability of deferred tax assets. The reserve for losses on mortgage loan repurchase obligations is discussed in Note 15.

Life insurance policies purchased under a bank-owned life insurance program are carried at their cash surrender value, which represents the amount that could be realized as of the reporting date. Earnings on these policies are reported in noninterest income and are not taxable.

The total for miscellaneous investments, receivables and other assets at March 31, 2011 and December 31, 2010 included approximately $7 million and $17 million, respectively, of investments in auction rate securities (ARS), which are investment grade securities with underlying holdings of municipal securities. The ARS were purchased at par from brokerage customers to provide a source of liquidity. Disruptions in the broader credit markets led to failed auctions in the ARS market and a resulting period of illiquidity. While management believes the ARS will be redeemed at par, the actual timing of redemptions is uncertain. These investments are carried at their estimated fair values.

NOTE 10

OTHER NONINTEREST INCOME

The components of other noninterest income were as follows.

	Three Months Ended
	March 31
(in thousands)	2011			2010
Investment services income	$	1,719		$	1,540
Credit-related fees		1,877			1,685
ATM fees		1,184			1,128
Other fees and charges		1,083			1,279
Earnings from bank-owned life insurance program		1,707			1,629
Other operating income		1,348			1,458
Net gains on sales and other revenue from foreclosed assets		2,070			588
Net gains (losses) on disposals of surplus property		(2	)		(6	)
Total	$	10,986		$	9,301

NOTE 11

OTHER NONINTEREST EXPENSE

The components of other noninterest expense were as follows.

	Three Months Ended
	March 31
(in thousands)	2011			2010
Security and other outsourced services	$	4,915		$	4,767
Bank card processing services		1,847			1,540
Advertising and promotion		1,274			1,571
Operating supplies		931			838
Loss on mortgage loan repurchase obligations		-			4,500
Valuation losses on loans held for sale, net gains on sales		(1,504	)		-
Miscellaneous operating losses		411			257
Other operating expenses		5,892			5,815
Total	$	13,766		$	19,288

The loss on mortgage loan repurchase obligations is discussed below in Note 15.

NOTE 12

EMPLOYEE RETIREMENT BENEFIT PLANS

Retirement Income Plans

Whitney has a noncontributory qualified defined-benefit pension plan. In 2008, the qualified plan was amended (a) to limit eligibility to those employees who were employed on December 31, 2008 and (b) to freeze benefit accruals for all participants other than those who were fully vested and whose age and years of benefit service combined equaled at least fifty as of December 31, 2008. Whitney also has an unfunded nonqualified defined-benefit pension plan that provides retirement benefits to designated executive officers.

The Company has contributed $2.1 million to the qualified plan in 2011 through the end of the first quarter and, based on currently available information, anticipates making no additional contributions for the remainder of the year.

The components of net periodic pension expense were as follows for the combined qualified and nonqualified plans.

	Three Months Ended
	March 31
(in thousands)	2011			2010
Service cost for benefits in period	$	2,182		$	1,789
Interest cost on benefit obligation		3,031			3,064
Expected return on plan assets		(4,135	)		(3,244	)
Amortization of:
Net actuarial loss		704			1,061
Prior service cost		78			80
Net periodic pension expense	$	1,860		$	2,750

The actuarial gains or losses and prior service costs or credits with respect to a retirement benefit plan that arise in a period but are not immediately recognized as components of net periodic pension expense are recognized, net of tax, as a component of other comprehensive income. The amounts included in accumulated other comprehensive income are adjusted as they are recognized as components of net periodic pension expense in subsequent periods.

Health and Welfare Plans

Whitney has offered health care and life insurance benefit plans for retirees and their eligible dependents. The Company funds its obligations under these plans as contractual payments come due to health care organizations and insurance companies. Currently, these plans restrict eligibility for postretirement health benefits to retirees already receiving benefits as of the plan amendments in 2007 and to those active participants who were eligible to receive benefits as of December 31, 2007. Life insurance benefits are currently only available to employees who retired before December 31, 2007. The net periodic expense for postretirement benefits was immaterial in both 2011 and 2010.

NOTE 13

SHARE-BASED COMPENSATION

Whitney maintains incentive compensation plans that incorporate share-based compensation. The plans for both employees and directors have been approved by the Company’s shareholders. Descriptions of these plans, including the terms of awards and the number of Whitney shares authorized for issuance, were included in Note 16 to the consolidated financial statements in the Company’s annual report on Form 10-K for the year ended December 31, 2010. No share-based compensation awards were made during the first quarter of 2011.

The Company recognized share-based compensation expense of $1.2 million ($.8 million after-tax) in the first quarter of 2011 and $1.3 million ($.8 million after-tax) in the first quarter of 2010.

NOTE 14

GOODWILL AND OTHER INTANGIBLE ASSETS

Goodwill is tested for impairment at least annually. The impairment test compares the estimated fair value of a reporting unit with its net book value. Whitney has assigned all goodwill to one reporting unit that represents the overall banking operations. The fair value of the reporting unit is based on valuation techniques that market participants would use in the acquisition of the whole unit, such as estimated discounted cash flows, the quoted market price of Whitney’s common stock including an estimated control premium, and observable average price-to-earnings and price-to-book multiples of our competitors. No indication of goodwill impairment was identified in the annual assessment as of September 30, 2010 or in an updated assessment as of December 31, 2010. Additional support for the fair value of the reporting unit was provided by the price indicated in the pending merger with Hancock.

NOTE 15

CONTINGENCIES

Legal Proceedings

The Company and its subsidiaries are parties to various legal proceedings arising in the ordinary course of business. After reviewing pending and threatened actions with legal counsel, management believes that the ultimate resolution of these actions will not have a material effect on Whitney’s financial condition, results of operations or cash flows.

On January 7, 2011, a purported shareholder of Whitney filed a lawsuit in the Civil District Court for the Parish of Orleans of the State of Louisiana captioned De LaPouyade v. Whitney Holding Corporation, et al. , No. 11-189, naming Whitney and members of Whitney’s board of directors as defendants. This lawsuit is purportedly brought on behalf of a putative class of Whitney’s common shareholders and seeks a declaration that it is properly maintainable as a class action. The lawsuit alleges that Whitney’s directors breached their fiduciary duties and/or violated Louisiana state law and that Whitney aided and abetted those alleged breaches of fiduciary duty by, among other things, (a) agreeing to consideration that undervalues Whitney, (b) agreeing to deal protection devices that preclude a fair sales process, (c) engaging in self-dealing, and (d) failing to protect against conflicts of interest. Among other relief, the plaintiff seeks to enjoin the merger. The parties have reached a settlement in principle.

On February 17, 2011, a complaint in intervention was filed by the Louisiana Municipal Police Employees Retirement System (“MPERS”) in the De LaPouyade case. The MPERS complaint is substantially identical to and seeks to join in the De LaPouyade complaint. The parties have reached a settlement in principle.

On February 7, 2011, another putative shareholder class action lawsuit, Realistic Partners v. Whitney Holding Corporation, et al. , Case No. 2:11-cv-00256, was filed in the United States District Court for the Eastern District of Louisiana against Whitney, members of Whitney’s board of directors, and Hancock asserting violations of Section 14(a) of the Securities Exchange Act of 1934, breach of fiduciary duty under Louisiana state law, and aiding and abetting breach of fiduciary duty by, among other things, (a) making material misstatements or omissions in the proxy statement, (b) agreeing to consideration that undervalues Whitney, (c) agreeing to deal protection devices that preclude a fair sales process, (d) engaging in self-dealing, and (e) failing to protect against conflicts of interest. Among other relief, the plaintiff seeks to enjoin the merger. On February 24, 2011, the plaintiff moved for class certification. The parties have reached a settlement in principle.

On April 11, 2011, another putative shareholder class action lawsuit, Jane Doe v. Whitney Holding Corporation, et al. , Case No. 2:11-cv-00794-ILRL-JCW, was filed in the United States District Court for the Eastern District of Louisiana against Whitney, members of Whitney’s board of directors, and the defendants’ insurance carrier asserting breach of fiduciary duty under Louisiana state law by, among other things, (a) agreeing to consideration that undervalues Whitney, (b) agreeing to deal protection devices that preclude a fair sales process, (c) engaging in self-dealing, and (d) failing to protect against conflicts of interest. Among other relief, the plaintiff seeks to enjoin the merger. On April 20, 2011, this case was consolidated with the Realistic Partners case. The parties have reached a settlement in principle.

Reserve for Losses on Mortgage Loan Repurchase Obligations

During 2010, the Company established a $4.5 million reserve for estimated losses on mortgage loan repurchase obligations associated with certain loans that were originated and sold by an acquired entity. The Bank has received repurchase demands from investors claiming loan defects that are covered by the standard representations and warranties in mortgage loan sale contracts executed by the acquired entity before the date of the acquisition. In determining the loss reserve estimate, management investigated the investor claims and the nature and cause of the underlying defects and evaluated the potential for additional claims associated with the loan origination and sale activities of the acquired entity. The Bank has made payments totaling $4.2 million with respect to investor claims through March 31, 2011, leaving an estimated loss reserve of $.3 million at that date. The Bank has incurred no losses stemming from the representations and warranties it makes in its own secondary mortgage market operations and historically has not maintained a loss reserve for repurchase obligations.

The reserve for losses on mortgage loan repurchase obligations is reported with accrued expenses and other liabilities in the consolidated balance sheets and the corresponding expense is reported with other noninterest expense in the consolidated income statements.

Indemnification Obligation

In 2007, Visa completed restructuring transactions that modified the obligation of members of Visa USA, including Whitney, to indemnify Visa against pending and possible settlements of certain litigation matters. In 2008, Visa completed an initial public offering of its shares and used the proceeds to redeem a portion of Visa USA members’ equity interests and to establish an escrow account that will fund any settlement of the members’ obligations under the indemnification agreement. Visa has made additional cash contributions to the escrow account subsequent to the initial funding. Although the Company remains obligated to indemnify Visa for losses in connection with certain litigation matters whose claims exceed amounts set aside in the escrow account, Whitney’s interest in the escrow balance approximates management’s current estimate of the value of the Company’s indemnification obligation. The amount of offering proceeds and other cash contributions to the escrow account for litigation settlements will reduce the number of shares of Visa stock to which Whitney will ultimately be entitled as a result of the restructuring.

NOTE 16

SHAREHOLDERS’ EQUITY AND REGULATORY MATTERS

Senior Preferred Stock

In December 2008, Whitney issued 300,000 shares of senior preferred stock to the U.S. Department of Treasury (Treasury) under the Capital Purchase Program (CPP) established under the Troubled Asset Relief Program (TARP) that was created as part of the Emergency Economic Stabilization Act of 2008 (EESA). Treasury also received a ten-year warrant to purchase 2,631,579 shares of Whitney common stock at an exercise price of $17.10 per share. The aggregate proceeds were $300 million, and the total capital raised qualifies as Tier 1 regulatory capital and can be used in calculating all regulatory capital ratios.

Whitney may not declare or pay dividends on its common stock or, with certain exceptions, repurchase common stock without first having paid all accrued cumulative preferred dividends that are due to Treasury. For three years from the preferred stock issue date, or until December 19, 2011, the Company also may not increase its common stock dividend rate above a quarterly rate of $.31 per share or repurchase its common shares without Treasury’s consent, unless Treasury has transferred all the preferred shares to third parties or the preferred stock has been redeemed.

Upon consummation of the merger with Hancock, the outstanding warrant issued to the Treasury would be converted into a warrant to purchase Hancock common stock, subject to appropriate adjustments to reflect the merger exchange ratio of .418.

Regulatory Capital Requirements

Measures of regulatory capital are an important tool used by regulators to monitor the financial health of financial institutions. The primary quantitative measures used by regulators to gauge capital adequacy are the ratio of Tier 1 regulatory capital to average total assets, also known as the leverage ratio, and the ratios of Tier 1 and total regulatory capital to risk-weighted assets. The regulators define the components and computation of each of these ratios. The minimum capital ratios for both the Company and the Bank are generally 4% leverage, 4% Tier 1 capital and 8% total capital.

To evaluate capital adequacy, regulators compare an institution’s regulatory capital ratios with their agency guidelines, as well as with the guidelines established as part of the uniform regulatory framework for prompt corrective supervisory action toward insured institutions. In reaching an overall conclusion on capital adequacy or assigning an appropriate classification under the uniform framework, regulators must also consider other subjective and quantitative assessments of risk associated with the institution. Regulators will take certain mandatory as well as possible additional discretionary actions against institutions that they judge to be inadequately capitalized. These actions could materially impact the institution’s financial position and results of operations.

Under the regulatory framework for prompt corrective action, the capital levels of banks are categorized into one of five classifications ranging from well-capitalized to critically under-capitalized. For an institution to be eligible to be classified as well-capitalized, its leverage, Tier 1 and total capital ratios must be at least 5%, 6% and 10%, respectively. If an institution fails to maintain a well-capitalized classification, it will be subject to a series of operating restrictions that increase as the capital condition worsens.

Regulators may, however, set higher capital requirements for an individual institution when particular circumstances warrant. As a result of operating losses during the difficult operating environment in recent years, the Bank has committed to its primary regulator that it will maintain higher capital ratios with a leverage of at least 8%, a Tier 1 regulatory capital ratio of at least 9%, and a total capital ratio of at least 12%. As of March 31, 2011, the Bank’s regulatory capital ratios exceeded the requisite capital levels to both satisfy these target minimums and to be eligible to be classified as well-capitalized, with a leverage ratio of 8.65%, a Tier 1 capital ratio of 11.30% and a total capital ratio of 14.35%.

Bank holding companies must also have at least a 6% Tier 1 capital ratio and a 10% total capital ratio to be considered well-capitalized for various regulatory purposes, and the Company satisfied these criteria at March 31, 2011. As noted above, the capital that was raised through the issuance of preferred stock to Treasury as part of TARP qualifies as Tier 1 regulatory capital and was used in calculating all of the Company’s regulatory capital ratios.

Regulatory Restrictions on Dividends

Regulatory policy statements provide that generally bank holding companies should only pay dividends out of current operating earnings and that the level of dividends, if any, must be consistent with current and expected capital requirements. The Company must currently obtain regulatory approval before increasing the common dividend rate above the current quarterly level of $.01 per share and must provide prior notice to its primary regulator in advance of declaring dividends on either its common on preferred stock.

Dividends received from the Bank have been the primary source of funds available to the Company for the declaration and payment of dividends to Whitney’s shareholders, both common and preferred. There are various regulatory and statutory provisions that limit the amount of dividends that the Bank can distribute to the Company. Because of recent losses in 2010 and 2009, the Bank currently has no capacity to declare dividends to the Company without prior regulatory approval.

NOTE 17

INCOME TAXES

The Company provided for income tax expense at an effective rate of 22.7% for the first quarter of 2011. For the first quarter of 2010, the Company provided an income tax benefit on the pre-tax loss in that period at an effective rate of 49.1%. Whitney’s effective tax rates have varied from the 35% federal statutory rate primarily because of tax-exempt interest income and the availability of tax credits. Interest income from the financing of state and local governments and earnings from the bank-owned life insurance program are the major components of tax-exempt income. The main source of tax credits has been investments in affordable housing projects and in projects that primarily benefit low-income communities or help the recovery and redevelopment of communities in the Gulf Opportunity Zone. Tax-exempt income and tax credits tend to increase the effective tax benefit rate from the statutory rate in loss periods and to reduce the effective tax expense rate in profitable periods. The impact on the effective rate becomes more pronounced as the pre-tax income or loss becomes smaller, leading to lower expense rates and higher tax benefit rates.

As of March 31, 2011, Whitney had $144 million in net deferred tax assets. Deferred tax assets are subject to an evaluation of whether it is more likely than not that they will be realized. In making such judgments, significant weight is given to evidence that can be objectively verified. Although Whitney generated taxable income in the first quarter of 2011, it still had a three-year cumulative taxable loss as of March 31, 2011 and had net operating loss and tax credit carry forwards. This is considered significant negative evidence when assessing the potential realization of a deferred tax asset. Although realization is not assured, management believes the recorded deferred tax assets are fully recoverable based on the Company’s strong historical taxable income, the taxable income generated in the first quarter of 2011 and the current forecast of taxable income that is sufficient to realize the net deferred tax assets during periods through which losses may be carried forward. The amount of future taxable income required to support the deferred tax asset in the carry forward period, which is currently 19 years, is approximately $495 million. If Whitney is unable to demonstrate that it can continue to generate sufficient taxable income in the near future, then the Company may not be able to conclude it is more likely than not that the benefits of the deferred tax assets will be fully realized and may be required to recognize a valuation allowance against its deferred tax assets with a corresponding increase in income tax expense.

NOTE 18

EARNINGS (LOSS) PER COMMON SHARE

The Financial Accounting Standards Board (FASB) has concluded that unvested share-based payment awards that contain nonforfeitable rights to dividends or dividend equivalents are participating securities and must be included in the computation of earnings per share using the two-class method. Whitney has awarded share-based payments that are considered participating securities under this guidance. The two-class method allocates net income to each class of common stock and participating security according to common dividends declared and participation rights in undistributed earnings.

The components used to calculate basic and diluted earnings (loss) per common share under the two-class method are shown in the following table. The net loss was not allocated to participating securities because the securities bear no contractual obligation to fund or otherwise share in losses. Potential common shares consist of employee and director stock options, unvested

restricted stock units awarded to employees without dividend rights, and stock warrants issued to Treasury in December 2008. These potential common shares do not enter into the calculation of diluted earnings per share if the impact would be anti-dilutive, i.e., increase earnings per share or reduce a loss per share.

		Three Months Ended
		March 31
(dollars in thousands, except per share data)		2011		2010
Numerator:
Net income (loss)		$	17,155	$	(6,280	)
Preferred stock dividends			4,067		4,067
Net income (loss) to common shareholders			13,088		(10,347	)
Net income allocated to participating securities – basic and diluted			169		-
Net income (loss) allocated to common shareholders – basic and diluted	A	$	12,919	$	(10,347	)
Denominator:
Weighted-average common shares – basic	B		96,728,115		96,534,425
Dilutive potential common shares			-		-
Weighted-average common shares – diluted	C		96,728,115		96,534,425
Earnings (loss) per common share:
Basic	A/B	$	.13	$	(.11	)
Diluted	A/C		.13		(.11	)
Weighted-average anti-dilutive potential common shares:
Stock options and restricted stock units			1,855,171		2,114,838
Warrants			2,631,579		2,631,579

NOTE 19

OFF-BALANCE SHEET FINANCIAL INSTRUMENTS AND DERIVATIVES

Off-Balance Sheet Financial Instruments

To meet the financing needs of its customers, the Bank issues financial instruments that represent conditional obligations that are not recognized, wholly or in part, in the consolidated balance sheets. These financial instruments include commitments to extend credit under loan facilities and guarantees under standby and other letters of credit. Such instruments expose the Bank to varying degrees of credit and interest rate risk in much the same way as funded loans.

Revolving loan commitments are issued primarily to support commercial activities. The availability of funds under revolving loan commitments generally depends on whether the borrower continues to meet credit standards established in the underlying contract and has not violated other contractual conditions. A number of such commitments are used only partially or, in some cases, not at all before they expire. Nonrevolving loan commitments are issued mainly to provide financing for the acquisition and development or construction of real property, both commercial and residential, although not all are expected to lead to permanent financing by the Bank. Loan commitments generally have fixed expiration dates and may require payment of a fee. Credit card and personal credit lines are generally subject to cancellation if the borrower’s credit quality deteriorates, and many lines remain partly or wholly unused.

Substantially all of the letters of credit are standby agreements that obligate the Bank to fulfill a customer’s financial commitments to a third party if the customer is unable to perform.

The Bank issues standby letters of credit primarily to provide credit enhancement to its customers’ other commercial or public financing arrangements and to help them demonstrate financial capacity to vendors of essential goods and services. Over 90% of the letters of credit outstanding at March 31, 2011 were rated as having average or better credit risk under the Bank’s credit risk rating guidelines. Approximately half of the total obligations under standby letters of credit outstanding at March 31, 2011 have a term of one year or less.

The Bank’s exposure to credit losses from these financial instruments is represented by their contractual amounts. The Bank follows its standard credit policies in approving loan facilities and financial guarantees and requires collateral support if warranted. The required collateral could include cash instruments, marketable securities, accounts receivable, inventory, property, plant and equipment, and income-producing commercial property. See Note 6 for a summary analysis of changes in the reserve for losses on unfunded credit commitments.

A summary of off-balance-sheet financial instruments follows.

	March 31		December 31
(in thousands)	2011		2010
Loan commitments – revolving	$	2,296,687	$	2,418,612
Loan commitments – nonrevolving		248,472		229,094
Credit card and personal credit lines		608,800		585,438
Standby and other letters of credit		321,172		336,226

Derivative Financial Instruments

The Bank offers interest rate swap agreements to commercial banking customers seeking to manage their interest rate risk. For each customer swap agreement, the Bank has entered into an offsetting agreement with an unrelated financial institution. These derivative financial instruments are carried at fair value, with changes in fair value recorded in current period earnings. The aggregate notional amounts of both customer interest rate swap agreements and the offsetting agreements were each $168 million at March 31, 2011 and each $146 million at December 31, 2010. The fair value of these derivatives and the credit risk exposure to the Bank were immaterial at March 31, 2011 and December 31, 2010.

NOTE 20

FAIR VALUE DISCLOSURES

The FASB defines fair value as the exchange price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. This accounting guidance also emphasizes that fair value is a market-based measurement and not an entity-specific measurement and established a hierarchy to prioritize the inputs that can be used in the fair value measurement process. The inputs in the three levels of this hierarchy are described as follows:

Level 1

Quoted prices in active markets for identical assets or liabilities. An active market is one in which transactions occur with sufficient frequency and volume to provide pricing information on an ongoing basis.

Level 2

Observable inputs other than Level 1 prices. This would include quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data.

Level 3

Unobservable inputs, to the extent that observable inputs are unavailable. This allows for situations in which there is little or no market activity for the asset or liability at the measurement date.

The material assets or liabilities measured at fair value by Whitney on a recurring basis are summarized below. Mortgage-backed securities are issued or guaranteed by U.S. government agencies and substantially all are backed by residential mortgages. Nonmarketable equity securities (Federal Reserve Bank and Federal Home Loan Bank stock) that are carried at cost are not included below. These equity securities totaled $49 million at March 31, 2011 and $45 million at December 31, 2010. The Level 2 fair value measurement shown below was obtained from a third-party pricing service that uses industry-standard pricing models. Substantially all the model inputs are observable in the marketplace or can be supported by observable data.

	Fair Value Measurement Using
(in millions)	Level 1		Level 2		Level 3
March 31, 2011
Investment securities available for sale:
Mortgage-backed securities		-	$	1,933		-
U. S. agency securities		-		18		-
Other debt securities		-		8		-
Derivative financial instruments – assets		-		3		-
Derivative financial instruments – liabilities		-		3		-
December 31, 2010
Investment securities available for sale:
Mortgage-backed securities		-	$	1,896		-
U. S. agency securities		-		18		-
Other debt securities		-		9		-
Derivative financial instruments – assets		-		4		-
Derivative financial instruments – liabilities		-		4		-

The fair value of interest rate swaps is obtained from a third-party pricing service that uses an industry-standard discounted cash flow model that relies on inputs, such as interest rate futures, observable in the marketplace. To comply with the accounting guidance, credit valuation adjustments are incorporated in the fair values to appropriately reflect nonperformance risk for both the Company and counterparties. Although the Company has determined that the majority of the inputs used to value derivative instruments fall within Level 2 of the fair value hierarchy, the credit valuation adjustments utilize Level 3 inputs, such as estimates of current credit spreads. The Company has determined that the impact of the credit valuation adjustments is not significant to the overall valuation of these derivatives. As a result, the Company has classified its derivative valuations in their entirety in Level 2 of the fair value hierarchy.

Certain assets and liabilities may be measured at fair value on a nonrecurring basis; that is, the instruments are not measured and reported at fair value on an ongoing basis, but are subject to fair value adjustments in certain circumstances. To measure the extent to which a loan is impaired, the relevant accounting principles permit or require the Company to compare the recorded investment in the impaired loans to the fair value of the underlying collateral in certain circumstances. The fair value measurement process uses independent appraisals and other market-based information, but in many cases it also requires significant input based on management’s knowledge of and judgment about current market conditions, specific issues relating to the collateral, and other matters. As a result, substantially all of these fair value measurements fall within Level 3 of the hierarchy discussed above. The net carrying value of impaired loans which reflected a nonrecurring fair value measurement totaled $34 million at March 31, 2011 and $53 million at December 31, 2010. The portion of the allowance for loan losses allocated to these loans totaled $2 million at March 31, 2011 and $1 million at year-end 2010. The valuation allowance on impaired loans and charge-offs factor into the determination of the provision for credit losses.

Accounting guidance from the FASB requires the disclosure of estimated fair value information about certain on- and off-balance sheet financial instruments, including those financial instruments that are not measured and reported at fair value on a recurring basis or nonrecurring basis. The significant methods and assumptions used by the Company to estimate the fair value of financial instruments are discussed below. The aggregate fair value amounts presented do not, and are not intended to, represent an aggregate measure of the underlying fair value of the Company.

Cash, federal funds sold and short-term investments and short-term borrowings – The carrying amounts of these highly liquid or short maturity financial instruments were considered a reasonable estimate of fair value.

Investment in securities available for sale and held to maturity – The fair value measurement for securities available for sale was discussed earlier. The same measurement approach was used for securities held to maturity, which consist of mortgage-backed securities, obligations of states and political subdivisions and corporate debt securities.

Loans – The fair value measurement for certain impaired loans was discussed earlier. For the remaining portfolio, fair values were generally determined by discounting scheduled cash flows by discount rates determined with reference to current market rates at which loans with similar terms would be made to borrowers of similar credit quality, including adjustments that management believes market participants would consider in setting required yields on loans from

certain portfolio sectors and geographic regions. An overall valuation adjustment was made for specific credit risks as well as general portfolio credit risk.

Deposits – The FASB’s guidance requires that deposits without a stated maturity, such as noninterest-bearing demand deposits, NOW account deposits, money market deposits and savings deposits, be assigned fair values equal to the amounts payable upon demand (carrying amounts). Deposits with a stated maturity were valued by discounting contractual cash flows using a discount rate approximating current market rates for deposits of similar remaining maturity.

Long-term debt – The fair value of long-term debt was estimated by discounting contractual payments at current market interest rates for similar instruments.

Derivative financial instruments – The fair value measurement for interest rate swaps was discussed earlier.

Off-balance sheet financial instruments – Off-balance sheet financial instruments include commitments to extend credit and guarantees under standby and other letters of credit. The fair values of such instruments were estimated using fees currently charged for similar arrangements in the market, adjusted for changes in terms and credit risk as appropriate. The estimated fair values of these instruments were not material.

The estimated fair values of the Company’s financial instruments follow.

	March 31, 2011				December 31, 2010
	Carrying		Fair		Carrying		Fair
(in millions)	Amount		Value		Amount		Value
ASSETS:
Cash and short-term investments	$	697	$	697	$	656	$	656
Investment securities available for sale (a)		1,960		1,960		1,923		1,923
Investment securities held to maturity		677		675		641		638
Loans held for sale		69		69		198		199
Loans, net		6,779		6,614		7,018		6,835
Derivative financial instruments		3		3		4		4
LIABILITIES:
Deposits		9,182		9,190		9,403		9,414
Short-term borrowings		469		469		543		543
Long-term debt		220		221		220		214
Derivative financial instruments		3		3		4		4
(a) Excludes nonmarketable equity securities carried at cost.

NOTE 21

ACCOUNTING STANDARDS DEVELOPMENTS

In July 2010, the FASB amended its guidance on disclosures about the credit quality of financing receivables and the allowance for credit losses. This guidance adds to the existing disclosure of credit quality indicators and requires that disclosures about credit quality and the allowance for credit losses be disaggregated by portfolio segment and, in certain cases, by class of financing receivable. A portfolio segment is the level at which an entity develops and documents a systematic method for determining its allowance for credit losses, and a class of financing receivable is generally a subset of a portfolio segment. Amended disclosures of end-of-period information were effective for the year ended December 31, 2010, while other activity-based disclosures are effective for the Company’s 2011 fiscal year (see Note 6).

WHITNEY HOLDING CORPORATION AND SUBSIDIARIES
SELECTED FINANCIAL DATA
(Unaudited)
	2011			2010
(dollars in thousands, except per share data)	First Quarter			Fourth Quarter			Third Quarter			Second Quarter			First Quarter
QUARTER-END BALANCE SHEET DATA
Total assets	$	11,496,074		$	11,798,779		$	11,517,194		$	11,416,761		$	11,580,806
Earning assets		10,180,576			10,488,071			10,246,178			10,214,267			10,395,252
Loans		6,993,353			7,234,726			7,733,932			7,979,371			8,073,498
Investment securities		2,685,792			2,609,602			2,297,338			2,076,313			2,042,307
Noninterest-bearing deposits		3,625,043			3,523,518			3,245,123			3,229,244			3,298,095
Total deposits		9,181,820			9,403,403			8,865,916			8,819,051			8,961,957
Shareholders' equity		1,538,613			1,524,334			1,638,661			1,674,166			1,676,240
AVERAGE BALANCE SHEET DATA
Total assets	$	11,585,440		$	11,774,859		$	11,563,331		$	11,503,150		$	11,656,777
Earning assets		10,237,174			10,481,277			10,331,541			10,314,161			10,482,211
Loans		7,130,806			7,638,375			7,881,160			8,051,668			8,210,283
Investment securities		2,672,697			2,344,312			2,115,549			2,021,359			2,008,095
Noninterest-bearing deposits		3,519,240			3,354,893			3,224,881			3,255,019			3,260,794
Total deposits		9,200,238			9,078,371			8,884,439			8,895,731			9,026,703
Shareholders' equity		1,529,831			1,649,829			1,670,244			1,676,468			1,684,537
INCOME STATEMENT DATA
Interest income	$	109,565		$	116,154		$	117,033		$	119,011		$	120,811
Interest expense		9,693			12,053			12,787			13,142			14,182
Net interest income		99,872			104,101			104,246			105,869			106,629
Net interest income (TE)		100,868			105,166			105,186			106,810			107,584
Provision for credit losses		-			148,500			70,000			59,000			37,500
Noninterest income		30,438			31,847			28,651			31,761			28,247
Net securities gains in noninterest income		-			-			-			-			-
Noninterest expense		108,128			130,358			113,118			110,147			109,706
Net income (loss)		17,155			(88,489	)		(29,004	)		(17,993	)		(6,280	)
Net income (loss) to common shareholders		13,088			(92,556	)		(33,071	)		(22,060	)		(10,347	)
KEY RATIOS
Return on average assets		.60	%		(2.98	) %		(1.00	) %		(.63	) %		(.22	) %
Return on average common shareholders' equity		4.30			(27.13	)		(9.55	)		(6.41	)		(3.02	)
Net interest margin		3.98			3.99			4.05			4.15			4.15
Average loans to average deposits		77.51			84.14			88.71			90.51			90.96
Efficiency ratio		82.35			95.14			84.52			79.49			80.77
Annualized expense to average assets		3.73			4.43			3.91			3.83			3.76
Allowance for loan losses to loans		3.06			3.00			2.89			2.88			2.77
Annualized net charge-offs to average loans		.15			8.14			3.89			2.65			1.81
Nonperforming assets to loans (including
nonaccrual loans held for sale) plus foreclosed
assets and surplus property		4.45			5.16			6.64			6.73			6.12
Average shareholders' equity to average assets		13.20			14.01			14.44			14.57			14.45
Tangible common equity to tangible assets		7.22			6.90			8.10			8.49			8.38
Leverage ratio		9.09			8.69			10.09			10.48			10.61
COMMON SHARE DATA
Earnings (loss) per share
Basic	$	.13		$	(.96	)	$	(.34	)	$	(.23	)	$	(.11	)
Diluted		.13			(.96	)		(.34	)		(.23	)		(.11	)
Cash dividends per share	$	.01		$	.01		$	.01		$	.01		$	.01
Book value per share	$	12.85		$	12.71		$	13.89		$	14.29		$	14.32
Tangible book value per share	$	8.26		$	8.11		$	9.28		$	9.65		$	9.67
Trading data
High sales price	$	14.50		$	14.43		$	10.04		$	15.29		$	14.53
Low sales price		12.47			7.84			7.04			9.25			9.05
End-of-period closing price		13.62			14.15			8.17			9.25			13.79
Tax-equivalent (TE) amounts are calculated using a marginal federal income tax rate of 35%.
The efficiency ratio is noninterest expense divided by total net interest (TE) and noninterest income (excluding securities transactions).
The tangible common equity to tangible assets ratio is total shareholders' equity less preferred stock and intangible assets divided by
total assets less intangible assets.

Item 2.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The purpose of this discussion and analysis is to focus on significant changes in the financial condition of Whitney Holding Corporation (the Company or Whitney) and its subsidiaries from December 31, 2010 to March 31, 2011 and on their results of operations during the first quarters of 2011 and 2010. Nearly all of the Company’s operations are contained in its banking subsidiary, Whitney National Bank (the Bank). This discussion and analysis is intended to highlight and supplement information presented elsewhere in this quarterly report on Form 10-Q, particularly the consolidated financial statements and related notes appearing in Item 1. This discussion and analysis should be read in conjunction with the Company’s annual report on Form 10-K, as amended, for the year ended December 31, 2010.

OVERVIEW OF RECENT DEVELOPMENTS

Whitney recorded net income of $17.2 million for the first quarter of 2011, compared to net losses of $88.5 million and $6.3 million, respectively, in the fourth and first quarters of 2010. Including dividends on preferred stock, net income to common shareholders was $13.1 million, or $.13 per diluted common share, for the first quarter of 2011. This compares to losses of $92.6 million, or $.96 per diluted share, in the fourth quarter of 2010 and $10.3 million, or $.11 per diluted share, in 2010’s first quarter.

Proposed Merger with Hancock Holding Company

On December 22, 2010, Whitney and Hancock Holding Company (Hancock) announced a strategic business combination in which Whitney will merge with and into Hancock. The combined company, which will retain the Hancock name but utilize the Whitney name throughout Louisiana and Texas, will have approximately $20 billion in assets and will operate 305 branches across the Gulf South and one foreign branch office on Grand Cayman in the British West Indies. If the merger is completed, holders of Whitney common stock will receive .418 of a share of Hancock common stock in exchange for each share of Whitney common stock held immediately prior to the merger, subject to the payment of cash in lieu of fractional shares. On April 29, 2011, the shareholders of both Whitney and Hancock voted to approve the merger agreement. Consummation of the merger is contingent upon regulatory approvals and other closing conditions.

Loans and Earning Assets

Total loans at the end of the first quarter of 2011 were down $241million, or 3%, from December 31, 2010, with reductions in all of the Bank’s geographic regions and most portfolio segments. This linked-quarter decline included $16.1 million in charge-offs and approximately $5.5 million in foreclosures. The remaining decrease reflected payoffs and repayments, including some larger oil and gas credits, several commercial real estate credits in Louisiana, Alabama and Texas and certain commercial and industrial customers with seasonal borrowing patterns. Overall demand for credit remained limited during the first quarter of 2011.

In the fourth quarter of 2010, Whitney reclassified $303 million of problem loans as held for sale and recognized charge-offs of $139 million to record these loans at the lower of their cost or fair value. Over half of the loans reclassified were real-estate related credits from Whitney’s Florida markets where the Bank has experienced its most significant credit losses in recent years.

The reclassification had a direct impact of approximately $112 million on the Company’s provision for loan losses for the fourth quarter of 2010 reflecting the cost associated with aggressively dealing with problem credits through bulk sale transactions versus individual problem credit resolutions. The carrying value of these loans at December 31, 2010 was $158 million. In the first quarter of 2011, Whitney sold approximately $95 million in carrying value of nonperforming loans held for sale, including the previously announced $83 million bulk sale completed in January 2011 .

Average loans for the first quarter of 2011 decreased $508 million, or 7%, compared to the fourth quarter of 2010, reflecting in part a full quarter’s impact of the reclassification of problem loans as held for sale toward the end of 2010. Average earning assets were down $244 million, or 2%, from the fourth quarter of 2010.

Deposits and Funding

Average deposits in the first quarter of 2011 were up $122 million, or 1%, from the fourth quarter of 2010. Total deposits at March 31, 2011 were down $222 million, or 2%, compared to December 31, 2010. Deposits at year-end 2010 included seasonal public funds and year-end deposits of certain commercial relationships. Average and period-end noninterest-bearing demand deposits increased 5% and 3%, respectively, compared to the fourth quarter of 2010. These demand deposits comprised 38% of total average deposits and funded 34% of average earning assets for the first quarter of 2011. The percentage of funding from all noninterest-bearing sources totaled 37% for the period.

Net Interest Income

Net interest income (TE) for the first quarter of 2011 decreased $4.3 million, or 4%, from the fourth quarter of 2010, with fewer days in the current period accounting for approximately $1.6 million of the decrease. Average earning assets decreased 2% linked-quarter, while the net interest margin (TE) was basically stable, declining only one basis point to 3.98%. The stability of the margin reflected a continued unfavorable shift in the mix of earning assets and decline in investment portfolio yields, offset by a favorable shift in funding sources, further reductions in deposit rates and a decrease in nonaccrual loans included in earning asset totals.

Provision for Credit Losses and Credit Quality

During the first quarter of 2011, Whitney recovered $5.8 million on a charge-off related to Hurricane Katrina taken in 2006. Based on its current assessment of the impact of the BP oil spill on the Company’s loan customers in the first quarter of 2011, management reversed the $5.0 million allowance established in the second quarter of 2010 to cover estimated losses from this event. The level of classified loans remained elevated at March 31, 2011, although the current portfolio of classified loans reflects more the normal stress associated with a slow recovery from a prolonged period of economic weakness rather than the impact of the severe real estate issues that persist in Florida and certain other areas of Whitney’s markets. As noted earlier, a large portion of the nonperforming loan portfolio was reclassified as held for sale with significant charge-offs during the fourth quarter of 2010. These loans consisted primarily of the type of real estate-related credits from certain Whitney market areas that have been the main driver of the provision for loan losses over the past two years. These actions, the Hurricane Katrina loss recovery, the reversal of the BP oil spill loss allowance and the current composition of classified loans are all reflected in management’s evaluation of the adequacy of the allowance for credit

losses and the decision to make no provision for credit losses in the first quarter of 2011. Whitney provided $148.5 million for credit losses in the fourth quarter of 2010. As noted earlier, the majority of the fourth quarter’s provision, $112 million, reflected the impact of the reclassification of problem loans as held for sale.

Noninterest Income

Noninterest income for the first quarter of 2011 decreased 4%, or $1.4 million, from the fourth quarter of 2010. Certain recurring sources of income showed seasonal declines in the first quarter of 2011. Secondary mortgage market income was down $1.4 million on lower production related in part to less refinancing activity compared to prior periods.

Noninterest Expense

Total noninterest expense for the first quarter of 2011 was down $22.2 million from the fourth quarter of 2010. Expenses associated with the pending merger with Hancock totaled $1.2 million in the first quarter of 2011 and $4.1 million in the fourth quarter of 2010. Loan collection costs, together with foreclosed management expenses, provisions for valuation losses on foreclosed assets and legal fees associated with problem credits totaled $8.8 million in the first quarter of 2011, down $11.7 million from the fourth quarter of 2010. As previously disclosed, problem resolution expenses were expected to be lower as the Company disposed of the problem loans held for sale. Legal and professional fees, excluding those associated with problem credits, declined $1.7 million, related mainly to costs associated with Whitney’s major technology project which has been suspended in anticipation of the merger with Hancock. Training expenses related to the technology project were down approximately $1.0 million from the fourth quarter of 2010.

Dodd-Frank Wall Street Reform and Consumer Protection Act

The Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) was signed into law in July 2010. This legislation represents a significant overhaul of many aspects of the regulation of the financial services industry. The Dodd-Frank Act addresses a number of issues including capital requirements, compliance and risk-management, debit card overdraft fees, healthcare, incentive compensation, expanded disclosures and corporate governance. The Dodd-Frank Act also established a new, independent Consumer Financial Protection Bureau which has broad rulemaking, supervisory and enforcement authority over consumer financial products, including deposit products, residential mortgages, home-equity loans and credit cards. The Dodd-Frank Act directs applicable regulatory authorities to promulgate a large number of regulations implementing its provisions, and its effect on Whitney and on the financial services industry as a whole will be clarified as those regulations are issued.

FINANCIAL CONDITION

LOANS, CREDIT RISK MANAGEMENT, AND ALLOWANCE AND RESERVE FOR CREDIT LOSSES

Loan Portfolio Developments

Total loans at the end of the first quarter of 2011 were down $241million, or 3%, from December 31, 2010, with reductions in all of the Bank’s geographic regions and most portfolio segments. Whitney continues to seek and has funded new credit relationships and is renewing existing ones, but the level of overall demand has been insufficient to cover repayments and maturities along with charge-offs and other problem loan resolutions. In light of the slow pace of recovery from the recent deep recession, management believes there will be little, if any, improvement in this situation until the economy begins a solid recovery.

Table 1 shows loan balances by type of loan at March 31, 2011 and at the end of the four prior quarters. Table 2 distributes the loan portfolio as of March 31, 2011 by the geographic region from which the loans are serviced. The following discussion provides a brief overview of the composition of the different portfolio sectors and the customers served in each, as well as recent changes.

TABLE 1. LOANS OUTSTANDING BY TYPE
		2011		2010
	March			December		September		June		March
(in millions)	31			31		30		30		31
Commercial & industrial		$	2,644	$	2,789	$	2,846	$	2,895	$	2,869
Owner-occupied real estate			1,062		1,003		1,070		1,053		1,069
Total commercial & industrial			3,706		3,792		3,916		3,948		3,938
Construction, land & land development			879		946		1,175		1,396		1,479
Other commercial real estate			1,017		1,123		1,223		1,197		1,217
Total commercial real estate			1,896		2,069		2,398		2,593		2,696
Residential mortgage			979		953		994		1,007		1,015
Consumer			412		421		426		431		424
Total loans		$	6,993	$	7,235	$	7,734	$	7,979	$	8,073

The portfolio of C&I loans, including real estate loans secured by properties used in the borrower’s business, decreased $86 million, or 2%, between year-end 2010 and March 31, 2011. C&I loans outstanding to oil and gas (O&G) industry customers declined approximately $67 million during the first quarter of 2011. There were also repayments on some seasonal C&I credits during the first quarter of 2011 totaling approximately $24 million. C&I charge-offs totaled $4 million for the period. In addition to the O&G industry, the C&I portfolio is diversified over a range of industries, including wholesale and retail trade in various durable and nondurable products and the manufacture of such products, marine transportation and maritime construction, hospitality, financial services and professional services.

The O&G portfolio represented approximately 9%, or $645 million, of total loans at March 31, 2011, down from 10% at year-end 2010. The majority of Whitney’s customer base in this industry provides transportation and other services and products to support exploration and production activities. Loans outstanding to the exploration and production sector comprised approximately 34% of the O&G portfolio at March 31, 2011, with the portfolio fairly evenly divided between natural gas and crude oil production based on measures of collateral support.

Whitney management and bankers continue to review O&G credits and talk to both customers and industry experts to assess the current and potential impact on the Bank’s O&G customer base from the regulatory and legislative responses to the 2010 oil spill in the Gulf of Mexico.

Outstanding balances under participations in larger shared-credit loan commitments totaled $527 million at the end of 2011’s first quarter, compared to $509 million outstanding at year-end 2010. The total at March 31, 2011 included approximately $148 million related to the O&G industry, which was down $11 million from the end of 2010. Substantially all of the shared credits are with customers operating in Whitney’s market area.

TABLE 2. GEOGRAPHIC DISTRIBUTION OF LOAN PORTFOLIO AT MARCH 31, 2011
										Alabama/						Percent
(dollars in millions)	Louisiana			Texas			Florida			Mississippi			Total			of total
Commercial & industrial	$	1,930		$	382		$	124		$	208		$	2,644			38	%
Owner-occupied real estate		681			125			174			82			1,062			15
Total commercial & industrial		2,611			507			298			290			3,706			53
Construction, land & land development		295			312			157			115			879			13
Other commercial real estate		552			120			219			126			1,017			14
Total commercial real estate		847			432			376			241			1,896			27
Residential mortgage		530			167			160			122			979			14
Consumer		282			25			64			41			412			6
Total	$	4,270		$	1,131		$	898		$	694		$	6,993			100	%
Percent of total		61	%		16	%		13	%		10	%		100	%

The commercial real estate (CRE) portfolio includes loans for construction and land development and investment (C&D), both commercial and residential, and other real estate loans secured by income-producing properties. The CRE portfolio decreased $173 million, or 8%, during the first quarter of 2011. Approximately $75 million of CRE loans were transferred to the C&I portfolio during the first quarter of 2011 following the completion of construction on properties used by C&I customers and the reclassification of real estate loans to customers in certain industries. The remaining decrease reflected payoffs from the refinancing of recently completed construction projects, other scheduled repayments on both project and permanent CRE loans and approximately $9 million of charge-offs and foreclosures. Project financing is an important component of the CRE portfolio sector, and sector growth is impacted by the availability of new projects as well as the anticipated refinancing of seasoned income properties in the secondary market and payments on residential development loans as inventory is sold. Management expects that current economic conditions and uncertainty will limit the availability of new creditworthy CRE projects throughout Whitney’s market area over the near term.

Tables 3 and 4 show the composition of certain components of the CRE portfolio by property type and the region from which the loans are serviced.

TABLE 3. CONSTRUCTION, LAND & LAND DEVELOPMENT LOANS AT MARCH 31, 2011
										Alabama/						Percent
(dollars in millions)	Louisiana			Texas			Florida			Mississippi			Total			of total
Residential construction	$	61		$	47		$	24		$	11		$	143			16	%
Land & lots:
Residential		96			13			53			36			198			23
Commercial		82			87			35			40			244			28
Retail		15			86			2			4			107			12
Multifamily		1			51			-			-			52			6
Office buildings		4			6			17			1			28			3
Industrial/warehouse		14			3			2			2			21			2
Hotel/motel		-			-			15			-			15			2
Other (a)		22			19			9			21			71			8
Total	$	295		$	312		$	157		$	115		$	879			100	%
Percent of total		34	%		35	%		18	%		13	%		100	%
(a) Includes agricultural land.

TABLE 4. OTHER COMMERCIAL REAL ESTATE LOANS AT MARCH 31, 2011
										Alabama/						Percent
(dollars in millions)	Louisiana			Texas			Florida			Mississippi			Total			of total
Retail	$	199		$	66		$	62		$	30		$	357			35	%
Multifamily		66			14			19			42			141			14
Office buildings		109			24			51			20			204			20
Industrial/warehouse		62			11			29			10			112			11
Hotel/motel		97			3			43			20			163			16
Other		19			2			15			4			40			4
Total	$	552		$	120		$	219		$	126		$	1,017			100	%
Percent of total		54	%		12	%		22	%		12	%		100	%

Credit Risk Management and Allowance and Reserve for Credit Losses

General Discussion of Credit Risk Management and Determination of Credit Loss Allowance and Reserve

Management’s evaluation of credit risk in the loan portfolio is reflected in its estimate of probable losses inherent in the portfolio that is reported in the Company’s financial statements as the allowance for loan losses. Changes in this evaluation over time are reflected in the provision for credit losses charged to expense. The methodology for determining the allowance involves significant judgment, and important factors that influence this judgment are re-evaluated quarterly to respond to changing conditions.

Whitney's credit risk management process and the methodology it uses to determine the allowance for credit losses are described in Note 6 to the consolidated financial statements located in Item 1 of this quarterly report on Form 10-Q,

Credit Quality Statistics and Components of Credit Loss Allowance and Reserve

Classified loans are those identified through the Company’s credit risk-rating process as having a well-defined weakness that would likely lead to a default if not corrected as well as those loans with a high probability of loss that have not yet been charged off due to specific pending events. Classified loans totaled $878 million at March 31, 2011. This represented an increase of $18 million from December 31, 2010. Table 5 shows the composition of classified loans at March 31, 2011, distributed by the geographic region from which the loans are serviced. Loans held for sale are not included in these totals.

TABLE 5. CLASSIFIED LOANS AT MARCH 31, 2011
																Percent of
										Alabama/						loan category
(dollars in millions)	Louisiana			Texas			Florida			Mississippi			Total			total
Commercial & industrial	$	108		$	64		$	8		$	35		$	215			8	%
Owner-user real estate		63			25			28			29			145			14	%
Total commercial & industrial		171			89			36			64			360			10	%
Construction land & land development		47			144			56			31			278			32	%
Other commercial real estate		38			28			40			29			135			13	%
Total commercial real estate		85			172			96			60			413			22	%
Residential mortgage		43			13			27			13			96			10	%
Consumer		2			1			5			1			9			2	%
Total	$	301		$	275		$	164		$	138		$	878			13	%
Percent of regional loan total		7	%		24	%		18	%		20	%		13	%

Classified C&I relationships, including associated real estate loans, totaled $360 million at March 31, 2011, or 10% of the total C&I portfolio. This represented a net increase of $25 million from year-end 2010 concentrated largely in Whitney’s Louisiana markets. Approximately $48 million, or 1%, of the total C&I portfolio was considered nonperforming at March 31, 2011, up $7 million from December 31, 2010. Over half of the nonperforming C&I credits were from Whitney’s Louisiana markets. Classified C&I loans outstanding to O&G industry customers totaled approximately $50 million at March 31, 2011, or 8% of the outstanding O&G industry portfolio. No O&G relationships had been classified at March 31, 2011 as a result of the 2010 oil spill and no significant O&G relationship was considered to be nonperforming at that date. Overall there were no significant industry concentrations within the totals for classified C&I loans at March 31, 2011.

Tables 6 and 7 show the composition of certain components of the classified CRE portfolio by property type and the region from which the loans are serviced.

TABLE 6. CLASSIFIED CONSTRUCTION, LAND & LAND DEVELOPMENT
LOANS AT MARCH 31, 2011
																Percent of
										Alabama/						loan category
(dollars in millions)	Louisiana			Texas			Florida			Mississippi			Total			total
Residential construction	$	4		$	4		$	5		$	1		$	14			10	%
Land & lots:
Residential		17			4			25			11			57			29
Commercial		20			60			13			4			97			40
Retail		-			39			-			-			39			36
Multifamily		-			23			-			-			23			44
Office buildings		-			-			12			-			12			43
Other (a)		6			14			1			15			36			51
Total	$	47		$	144		$	56		$	31		$	278			32	%
Percent of regional loan category total		16	%		46	%		36	%		27	%		32	%
(a) Includes agricultural land.

The total for classified C&D loans of $278 million at March 31, 2011 was up $6 million from December 31, 2010. Whitney’s Alabama/Mississippi markets saw a net increase of $15 million in classified C&D loans during the first quarter of 2011, reflecting mainly increased concern over one borrower in the timber industry. Classified C&D loans serviced from Whitney’s Texas market decreased a net $16 million reflecting additional repayments or full payoffs on a number of development loans. The Texas classified total represented 46% of total C&D loans in this market at March 31, 2011. General economic and credit market conditions delayed the successful completion of retail, apartment, condominium and various other income-producing CRE projects, which stretched the financial capacity of the developers. Whitney bankers have worked proactively with these borrowers, many of whom are seasoned developers, to identify and develop strategies to deal with these difficult conditions, and management believes most of the underlying projects remain viable. Charge-offs on C&D loans from the Texas market totaled less than $1 million for the first quarter of 2011. Nonperforming C&D loans totaled $54 million at March 31, 2011, of which $17 million was from Texas and $16 million from Florida markets.

TABLE 7. CLASSIFIED OTHER COMMERCIAL REAL ESTATE LOANS AT MARCH 31, 2011
																Percent of
										Alabama/						loan category
(dollars in millions)	Louisiana			Texas			Florida			Mississippi			Total			total
Retail	$	5		$	18		$	5		$	7		$	35			10	%
Multifamily		11			-			3			20			34			24
Office buildings		11			7			11			1			30			15
Industrial/warehouse		6			-			10			1			17			15
Hotel/motel		3			3			7			-			13			8
Other		2			-			4			-			6			15
Total	$	38		$	28		$	40		$	29		$	135			13	%
Percent of regional loan category total		7	%		23	%		18	%		23	%		13	%

Classified other CRE loans on income-producing properties declined $13 million, net, during the first quarter of 2011. As was the case with the C&D portfolio, Whitney’s Texas market saw a net decrease of $21 million in classified other CRE loans during the first quarter of 2011 that was driven mainly by full payoffs on term loans on recently completed development projects. Florida markets saw a net increase of $15 million in classified other CRE loans during 2011’s first quarter that involved various leased office and industrial facilities and hotels, including some seasoned properties impacted by the sustained difficult economic environment in this region. Nonperforming loans on income-producing CRE totaled $29 million at March 31, 2011, with most in the Louisiana and Florida markets. Management continues to closely monitor the extent to which the slow economic recovery out of the recent deep recession is impacting CRE loan customers in all of Whitney’s markets.

Included in the total of classified loans at March 31, 2011 was $174 million of nonaccrual loans held for investment, which is up a net $34 million from year-end 2010, mainly in Whitney’s Louisiana market. The Louisiana market accounted for $80 million of nonperforming loans held for investment at March 31, 2011, with another $43 million from Florida, $27 million from Texas and $24 million from Alabama/Mississippi. The earlier discussion of classified loans includes some additional details on the composition of nonperforming assets at March 31, 2011. Table 8 provides information on nonaccrual loans and other nonperforming assets at March 31, 2011 and at the end of the previous four quarters. Nonaccrual loans held for investment and restructured accruing loans encompass all loans that are evaluated separately for impairment. Nonperforming loans held for investment at March 31, 2011 included $55 million of loans on which losses had been recognized through charges against the allowance for loan losses. The charge-offs recognized totaled $29 million, which represented 34% of the remaining contractual principal on these loans at March 31, 2011. The allowance for loan losses at March 31, 2011 represented 168% of nonperforming loans held for investment, excluding those loans with prior charge-offs.

TABLE 8. NONPERFORMING ASSETS
	2011			2010
	March			December			September			June			March
(dollars in thousands)		31			31			30			30			31
Loans accounted for on a nonaccrual basis:
Held for investment	$	174,484		$	140,519		$	428,012		$	451,405		$	436,680
Held for sale		57,218			158,044			-			-			-
Restructured loans accruing		7,330			-			-			-			-
Total nonperforming loans		239,032			298,563			428,012			451,405			436,680
Foreclosed assets and surplus property		78,155			87,696			91,770			91,506			60,879
Total nonperforming assets	$	317,187		$	386,259		$	519,782		$	542,911		$	497,559
Loans 90 days past due still accruing	$	10,235		$	14,283		$	28,518		$	10,539		$	17,591
Ratios:
Nonperforming assets to loans (a)
plus foreclosed assets and surplus property		4.45	%		5.16	%		6.64	%		6.73	%		6.12	%
Nonaccrual loans held for investment to loans (b)		2.49			1.94			5.53			5.66			5.41
Allowance for loan losses to nonperforming loans		117.81			154.32			52.16			50.93			51.27
Loans 90 days past due still accruing to loans		.15			.20			.37			.13			.22
(a) Including nonaccrual loans held for sale.
(b) Excluding nonaccrual loans held for sale.

Whitney will continue to evaluate all opportunities to dispose of nonperforming assets as quickly as possible, including consideration of the trade-offs between current disposal prices and the carrying costs and management challenges of longer-term resolution. Whitney may recognize losses on future asset disposition decisions and actions.

Table 9 recaps activity in the allowance for loan losses and in the reserve for losses on unfunded credit commitments for the first quarter of 2011 and each quarter in 2010.

During the first quarter of 2011, Whitney recovered $5.8 million on a charge-off related to Hurricane Katrina taken in 2006. Based on its current assessment of the impact of the BP oil spill on the Company’s loan customers in the first quarter of 2011, management reversed the $5.0 million allowance established in the second quarter of 2010 to cover estimated losses from this event. The level of classified loans remained elevated at March 31, 2011, although the current portfolio of classified loans reflects more the normal stress on C&I and other credits associated with a slow recovery from a prolonged period of economic weakness rather than the impact of the severe real estate issues that persist in Florida and certain other areas of Whitney’s markets. As noted earlier, a large portion of the nonperforming loan portfolio was reclassified as held for sale with significant charge-offs during the fourth quarter of 2010. These loans consisted primarily of the type of real estate-related credits from certain Whitney market areas that have been the main driver of the provision for loan losses over the past two years. These actions, the Hurricane Katrina loss recovery, the reversal of the BP oil spill loss allowance and the current composition of classified loans are all reflected in management’s evaluation of the adequacy of the allowance for credit losses and decision to make no provision for credit losses in the first quarter of 2011. The reclassification of nonperforming loans as held for sale in the fourth quarter of 2010 had an impact of approximately $112 million on the provision in that period reflecting the cost associated with aggressively dealing with problem credits through bulk sale transactions versus individual problem credit resolutions.

Net loan charge-offs in the first quarter of 2011 were $2.7 million, or .15% of average loans on an annualized basis, compared to $155.4 million, or 8.14% of average loans, in the fourth quarter of 2010 and $37.1 million, or 1.81% of average loans, in 2010’s first quarter. Approximately half of the $16 million in gross charge-offs in the first quarter of 2011 were from Whitney’s Florida markets. Approximately $90 million of the gross charge-offs in the fourth quarter of 2010 were related to loans included in the bulk sale, $49 million were charge-offs on additional loans reclassified as held for sale, and approximately $23 million were charge-offs on the remaining loan portfolio.

The allowance for loan losses represented 3.06% of total loans held for investment at March 31, 2011, compared to 3.00% at December 31, 2010 and 2.77% a year earlier.

TABLE 9. SUMMARY OF ACTIVITY IN THE ALLOWANCE FOR LOAN LOSSES AND
RESERVE FOR LOSSES ON UNFUNDED CREDIT COMMITMENTS
	Three Months Ended
	March 31			December 31			September 30			June 30			March 31
(dollars in thousands)	2011			2010			2010			2010			2010
ALLOWANCE FOR LOAN LOSSES
Allowance at beginning of period	$	216,843		$	223,254		$	229,884		$	223,890		$	223,671
Provision for credit losses		-			149,000			70,000			59,300			37,300
Loans charged off:
Commercial & industrial		(3,190	)		(17,370	)		(10,849	)		(10,859	)		(12,541	)
Owner-user real estate		(1,202	)		(22,003	)		(6,489	)		(2,187	)		(595	)
Total commercial & industrial		(4,392	)		(39,373	)		(17,338	)		(13,046	)		(13,136	)
Construction, land & land development		(3,884	)		(57,386	)		(25,835	)		(29,299	)		(16,085	)
Other commercial real estate		(3,110	)		(45,793	)		(23,825	)		(8,870	)		(5,133	)
Total commercial real estate		(6,994	)		(103,179	)		(49,660	)		(38,169	)		(21,218	)
Residential mortgage		(3,062	)		(16,323	)		(10,238	)		(4,331	)		(4,129	)
Consumer		(1,659	)		(2,591	)		(2,826	)		(2,402	)		(1,504	)
Total charge-offs		(16,107	)		(161,466	)		(80,062	)		(57,948	)		(39,987	)
Recoveries on loans previously charged off:
Commercial & industrial		4,298			1,934			1,150			1,586			1,228
Owner-user real estate		10			564			875			816			24
Total commercial & industrial		4,308			2,498			2,025			2,402			1,252
Construction, land & land development		5,675			2,120			757			1,250			1,178
Other commercial real estate		2,776			290			27			445			8
Total commercial real estate		8,451			2,410			784			1,695			1,186
Residential mortgage		415			437			301			320			253
Consumer		276			710			322			225			215
Total recoveries		13,450			6,055			3,432			4,642			2,906
Net loans charged off		(2,657	)		(155,411	)		(76,630	)		(53,306	)		(37,081	)
Allowance at end of period	$	214,186		$	216,843		$	223,254		$	229,884		$	223,890
Ratios (a)
Allowance for loan losses to loans		3.06	%		3.00	%		2.89	%		2.88	%		2.77	%
Net charge-offs to average loans		.15			8.14			3.89			2.65			1.81
Gross charge-offs to average loans		.90			8.46			4.06			2.88			1.95
Recoveries to gross charge-offs		83.50			3.75			4.29			8.01			7.27
RESERVE FOR LOSSES ON UNFUNDED CREDIT COMMITMENTS
Reserve at beginning of period	$	1,600		$	2,100		$	2,100		$	2,400		$	2,200
Provision for credit losses		-			(500	)		-			(300	)		200
Reserve at end of period	$	1,600		$	1,600		$	2,100		$	2,100		$	2,400
(a) Totals for end-of-period and average loans used in ratio calculations excluded loans held for sale.

INVESTMENT SECURITIES

Whitney’s investment securities portfolio balance of $2.69 billion at March 31, 2011 was up $76 million, or 3%, compared to December 31, 2010. The increased investment in securities reflects management’s current projections for both loan demand and the level of liquidity in Whitney’s traditional customer funding base. Securities with carrying values of $1.17 billion at March 31, 2011 were sold under repurchase agreements, pledged to secure public deposits or pledged for other purposes. Average investment securities in the current quarter were up $328 million, or 14%, from the fourth quarter of 2010. The composition of the average portfolio of investment securities and effective yields are shown in Table 14 in the section on “Net Interest Income (TE)” in the later discussion of “Results of Operations.”

Mortgage-backed securities issued or guaranteed by U.S. government agencies continued to be the main component of the portfolio, comprising 88% of the total at March 31, 2011. The duration of the overall investment portfolio was 3.3 years at March 31, 2011 and would extend to 4.6 years assuming an immediate 300 basis-point increase in market rates, according to the Company’s asset/liability management model. Duration provides a measure of the sensitivity of the portfolio’s fair value to changes in interest rates. At December 31, 2010, the portfolio’s estimated duration was 3.2 years.

Securities available for sale comprised 75% of the total investment portfolio at March 31, 2011. Available-for-sale securities are carried at fair value, and the balance reported at March 31, 2011 reflected gross unrealized gains of $43.3 million and gross unrealized losses of $8.1 million. The unrealized losses were related mainly to mortgage-backed securities and represented less than 2% of the total amortized cost of the underlying securities. Note 3 to the consolidated financial statements located in Item 1 of this quarterly report on Form 10-Q provides information on the process followed by management to evaluate whether unrealized losses on securities, both those available for sale and those held to maturity, represent impairment that is other than temporary and that should be recognized with a charge to operations. No value impairment was evaluated as other than temporary at March 31, 2011.

The Company does not normally maintain a trading portfolio, other than holding trading account securities for short periods while buying and selling securities for customers. Such securities, if any, are included in other assets in the consolidated balance sheets.

DEPOSITS AND BORROWINGS

Deposits

Total deposits at March 31, 2011 decreased approximately $222 million, or 2%, from December 31, 2010. Deposits at year-end included seasonal public funds and year-end deposits of certain commercial relationships. Average total deposits for the first quarter of 2011 were up $122 million, or 1%, from the fourth quarter of 2010. Table 10 shows the composition of deposits at March 31, 2011, and at the end of the previous four quarters. Table 14 in the section entitled “Net Interest Income (TE)” in the later discussion of “Results of Operations” presents the composition of average deposits and borrowings and the effective rates on interest-bearing funding sources for the first quarter of 2011 and the fourth and first quarters of 2010.

TABLE 10. DEPOSIT COMPOSITION
	2011				2010
(dollars in millions)	March 31				December 31				September 30				June 30				March 31
Noninterest-bearing
demand deposits	$	3,625	39	%	$	3,524	37	%	$	3,245	37	%	$	3,229	37	%	$	3,298	37	%
Interest-bearing deposits:
NOW account deposits		1,163	13			1,310	14			1,172	13			1,098	12			1,161	13
Money market deposits		1,786	20			1,913	21			1,763	20			1,790	20			1,768	20
Savings deposits		920	10			903	10			868	10			857	10			869	10
Other time deposits		649	7			689	7			710	8			722	8			745	8
Time deposits
$100,000 and over		1,039	11			1,064	11			1,108	12			1,123	13			1,121	12
Total interest-bearing		5,557	61			5,879	63			5,621	63			5,590	63			5,664	63
Total	$	9,182	100	%	$	9,403	100	%	$	8,866	100	%	$	8,819	100	%	$	8,962	100	%

Noninterest-bearing demand deposits grew $101 million, or 3%, compared to year-end 2010 and were up 10% from March 31, 2010. Demand deposits comprised 39% of total deposits at March 31, 2011 compared to 37% at December 31, 2010.

Time deposits at March 31, 2011 were down $65 million compared to year-end 2010 and $178 million, or 10%, compared to March 31, 2010. The sustained period of low market interest rates has tended to reduce the attractiveness of time deposits compared to alternative deposit products and investments. Customers held $227 million of funds in treasury-management time deposit products at March 31, 2011, up $38 million from the total held at December 31, 2010. These products are used mainly by commercial customers with excess liquidity pending redeployment for corporate or investment purposes, and, while they provide a recurring source of funds, the amounts available over time can be volatile. Competitively bid public fund time deposits totaled approximately $75 million at March 31, 2011, which was down $15 million from year-end 2010. Treasury-management deposits and public fund deposits serve partly as an alternative to Whitney’s other short-term borrowings.

Short-Term Borrowings

The balance of short-term borrowings at March 31, 2011 was down 14%, or $75 million, from year-end 2010. The main source of short-term borrowings continues to be the sale of securities under repurchase agreements to customers using Whitney’s treasury-management sweep product. Borrowings from customers under securities repurchase agreements totaled $445 million at March 31, 2011, which was down $78 million from December 31, 2010. Similar to Whitney’s treasury-management deposit products, this customer-based source of funds can be volatile. Average borrowings under repurchase agreements totaled $506 million during the first quarter of 2011, and the maximum borrowed at any month end during the period was $558 million. The Bank paid interest at a .13% rate on both average and period-end borrowings under repurchase agreements for the first quarter of 2011. Other short-term borrowings, which have included purchased federal funds, short-term Federal Home Loan Bank (FHLB) advances and borrowing through the Federal Reserve’s Term Auction Facility, were relatively minor at both March 31, 2011 and December 31, 2010 and throughout the first quarter of 2011, reflecting mainly weak loan demand.

SHAREHOLDERS’ EQUITY AND CAPITAL ADEQUACY

Shareholders’ equity totaled $1.54 billion at March 31, 2011, which represented an increase of $14.3 million from the end of 2010. Net income of $17.2 million for the first quarter of 2011 was partially offset by common dividends declared of $1.0 million and preferred dividends of $3.8 million.

Regulatory Capital

Tables 11 and 12 present information on regulatory capital ratios for the Company and the Bank. The Treasury’s investment in preferred stock and common stock warrants is included in Tier 1 capital for the Company. The Tier 2 regulatory capital for both the Company and the Bank includes $150 million in subordinated notes payable issued by the Bank.

The improvement in all the regulatory capital ratios from December 31, 2010 reflected both the increases in Tier 1 and total regulatory capital and the reductions in both the risk-weighted and average assets used in the ratio calculations. The increase in Tier 1 and total regulatory capital stemmed mainly from the net income retained in the first quarter of 2011 and a reduction in the amount of deferred tax assets disallowed for regulatory capital calculations. The rules governing regulatory capital treatment of deferred tax assets differ from and are more limiting than the generally accepted accounting guidance applied in evaluating the need for a deferred tax asset valuation allowance. No valuation allowance was required in the financial statements as of March 31, 2011 or December 31, 2010. The section entitled “Income Taxes” in the later discussion of “Results of Operations” includes additional information on the Company’s process of evaluating the potential realization of deferred tax assets. The decreases in risk-weighted and average assets reflected mainly the reduction in outstanding loans, including the impact of the bulk sale of problem loans held for sale in January 2011.

TABLE 11. REGULATORY CAPITAL AND CAPITAL RATIOS – COMPANY
	March 31			December 31
(dollars in thousands)	2011			2010
Tier 1 regulatory capital	$	1,001,744		$	972,105
Tier 2 regulatory capital		256,693			261,921
Total regulatory capital	$	1,258,437		$	1,234,026
Risk-weighted assets	$	8,439,036		$	8,860,473
Ratios:
Leverage (Tier 1 capital to average assets)		9.09	%		8.69	%
Tier 1 capital to risk-weighted assets		11.87			10.97
Total capital to risk-weighted assets		14.91			13.93

The minimum capital ratios are generally 4% leverage, 4% Tier 1 capital and 8% total capital. Regulators may, however, set higher capital requirements for an individual institution when particular circumstances warrant. Bank holding companies must also have at least a 6% Tier 1 capital ratio and a 10% total capital ratio to be considered well-capitalized for various regulatory purposes. As of March 31, 2011, the Company had the requisite capital levels to qualify as well-capitalized by its regulators.

TABLE 12. REGULATORY CAPITAL AND CAPITAL RATIOS – BANK
	March 31		December 31
(dollars in thousands)	2011		2010
Tier 1 regulatory capital	$ 951,910		$ 916,956
Tier 2 regulatory capital	256,486		261,711
Total regulatory capital	$1,208,396		$1,178,667
Risk-weighted assets	$8,422,522		$8,843,656
Regulatory capital ratios:
Leverage (Tier 1 capital to average assets)	8.65	%	8.21	%
Tier 1 capital to risk-weighted assets	11.30		10.37
Total capital to risk-weighted assets	14.35		13.33

For a bank to qualify as well-capitalized under the current regulatory framework for prompt corrective supervisory action, its leverage, Tier 1 and total capital ratios must be at least 5%, 6% and 10%, respectively. As a result of operating losses during the difficult operating environment in recent years, the Bank has committed to its primary regulator that it will maintain higher capital ratios with a leverage ratio of at least 8%, a Tier 1 regulatory capital ratio of at least 9%, and a total risk-based capital ratio of at least 12%. As of March 31, 2011, the Bank exceeded the requisite capital levels to both satisfy these target minimums and to be eligible to be classified as well-capitalized by its regulators.

Dividends

The Company declared a nominal quarterly dividend of $.01 per share to common shareholders for the first quarter of 2011 and throughout 2010. The Company must currently obtain regulatory approval before increasing the common dividend rate above this level and must provide prior notice to its primary regulator in advance of declaring dividends on either its

common or preferred stock. Regulatory policy statements provide that generally bank holding companies should only pay dividends out of current operating earnings and that the level of dividends, if any, must be consistent with current and expected capital requirements. Preferred dividends totaled $3.8 million for the first quarter of 2011.

In addition to these regulatory requirements and restrictions, Whitney’s ability to pay common dividends is also limited by its participation in the Treasury’s CPP. Prior to December 19, 2011, unless the Company has redeemed the preferred stock issued to the Treasury in the CPP or the Treasury has transferred the preferred stock to a third party, Whitney cannot pay a quarterly common dividend above $.31 per share. Furthermore, if Whitney is not current in the payment of quarterly dividends on the preferred stock, it cannot pay dividends on its common stock.

The common dividend rate will be reassessed quarterly in light of credit quality trends, expected earnings performance and capital levels, limitations resulting from Treasury’s CPP or regulatory requirements, and the Bank’s capacity to declare and pay dividends to the Company. It is unlikely that Whitney will increase its common dividend in the near term.

LIQUIDITY MANAGEMENT AND CONTRACTUAL OBLIGATIONS

Liquidity Management

The objective of liquidity management is to ensure that funds are available to meet the cash flow requirements of depositors and borrowers, while at the same time meeting the operating, capital and strategic cash flow needs of the Company and the Bank. Whitney develops its liquidity management strategies and measures and monitors liquidity risk as part of its overall asset/liability management process, making full use of quantitative modeling tools available to project cash flows under a variety of possible scenarios, including credit-stressed conditions.

Liquidity management on the asset side primarily addresses the composition and maturity structure of the loan portfolio and the portfolio of investment securities and their impact on the Company’s ability to generate cash flows from scheduled payments, contractual maturities and prepayments, through use as collateral for borrowings, and through possible sale or securitization. At March 31, 2011, securities available for sale with a carrying value of $1.02 billion, out of a total available for sale portfolio of $2.01 billion, were sold under repurchase agreements, pledged to secure public deposits or pledged for other purposes.

On the liability side, liquidity management focuses on growing the base of core deposits at competitive rates, including the use of treasury-management products for commercial customers, while at the same time ensuring access to economical wholesale funding sources. The section above entitled “Deposits and Borrowings” discusses changes in these liability funding sources in the first quarter of 2011.

In late 2008, the FDIC took certain steps that were designed to support deposit retention and to enhance the liquidity of the nation’s insured depository institutions and thereby assist in stabilizing the overall economy following the severe disruption in the credit markets. The FDIC temporarily increased deposit insurance coverage limits for all deposit accounts from $100,000 to $250,000 per depositor through December 31, 2009. This expanded coverage was subsequently extended through December 31, 2013, and it was later made permanent as part of the Dodd-Frank Act. In addition to the increased coverage limits, the FDIC also offered to provide unlimited deposit insurance coverage for noninterest-bearing transaction accounts and certain other specified deposits through the end of 2009. The FDIC initially extended this unlimited

coverage through June 30, 2010 and later approved an additional extension through at least December 31, 2010. A provision of the Dodd-Frank Act authorized mandatory unlimited coverage of noninterest-bearing demand deposits and certain other deposit products for a period of two years beginning in 2011.

Wholesale funding currently available to the Bank includes FHLB advances, federal funds purchased from correspondents and borrowings through the Federal Reserve Discount Window. The Bank’s unused borrowing capacity from the FHLB at March 31, 2011 totaled approximately $1.6 billion and is secured by a blanket lien on loans secured by real estate. The Bank’s unused borrowing capacity from the Federal Reserve Discount Window totaled approximately $.9 billion at March 31, 2011, based on the collateral pledged. In addition, both the Company and the Bank have access to external funding sources in the financial markets.

Cash generated from operations is another important source of funds to meet liquidity needs. The consolidated statements of cash flows located in Item 1 of this quarterly report on Form 10-Q present operating cash flows and summarize all significant sources and uses of funds for the first quarters of 2011 and 2010.

At March 31, 2011, the Company had approximately $48 million in cash and demand notes from the Bank available to provide liquidity for future dividend payments to its common and preferred shareholders and for other corporate purposes, including making additional capital contributions to the Bank. The Company made a $165 million capital contribution to the Bank during 2010 in response to operating losses in recent years. Whitney reduced its quarterly common dividend to $.01 per share throughout 2009 and 2010 and into 2011. The Company must currently obtain regulatory approval before increasing the common dividend above this rate and must provide prior notice to its primary regulator in advance of declaring dividends on either its common or preferred stock.

Contractual Obligations

Payments due from the Company and the Bank under specified long-term and certain other binding contractual obligations, other than obligations under deposit contracts and short-term borrowings, were scheduled in Whitney’s annual report on Form 10-K for the year ended December 31, 2010. The most significant obligations included long-term debt service, operating leases for banking facilities and various multi-year contracts for outsourced services and software licenses. There have been no material changes in contractual obligations from year-end 2010 through the end of first quarter of 2011.

OFF-BALANCE-SHEET ARRANGEMENTS

As a normal part of its business, the Company enters into arrangements that create financial obligations that are not recognized, wholly or in part, in the consolidated financial statements. The most significant off-balance sheet obligations are the Bank’s commitments under traditional credit-related financial instruments. Table 13 schedules these commitments as

of March 31, 2011 by the periods in which they expire. Commitments under credit card and personal credit lines generally have no stated maturity.

TABLE 13. CREDIT-RELATED COMMITMENTS
	Commitments expiring by period from March 31, 2011
			Less than			1 - 3		3 - 5	More than
(in thousands)	Total		1 year		years		years		5 years
Loan commitments – revolving	$	2,296,687	$	1,598,382	$	497,492	$	200,750	$	63
Loan commitments – nonrevolving		248,472		127,002		116,140		5,330		-
Credit card and personal credit lines		608,800		608,800		-		-		-
Standby and other letters of credit		321,172		161,622		111,184		48,366		-
Total	$	3,475,131	$	2,495,806	$	724,816	$	254,446	$	63

Revolving loan commitments are issued primarily to support commercial activities. The availability of funds under revolving loan commitments generally depends on whether the borrower continues to meet credit standards established in the underlying contract and has not violated other contractual conditions. A number of such commitments are used only partially or, in some cases, not at all before they expire. Credit card and personal credit lines are generally subject to cancellation if the borrower’s credit quality deteriorates, and many lines remain partly or wholly unused. Unfunded balances on revolving loan commitments and credit lines should not be used to project actual future liquidity requirements. Nonrevolving loan commitments are issued mainly to provide financing for the acquisition and development or construction of real property, both commercial and residential, although not all are expected to lead to permanent financing by the Bank. Expectations about the level of draws under all credit-related commitments, including the prospect of temporarily increased levels of draws on back-up commercial facilities during periods of disruption in the credit markets, are incorporated into the Company’s liquidity and asset/liability management models.

Substantially all of the letters of credit are standby agreements that obligate the Bank to fulfill a customer’s financial commitments to a third party if the customer is unable to perform. The Bank issues standby letters of credit primarily to provide credit enhancement to its customers’ other commercial or public financing arrangements and to help them demonstrate financial capacity to vendors. Historically, the Bank has had minimal calls to perform under standby agreements.

ASSET/LIABILITY MANAGEMENT

The objective of the Company’s asset/liability management is to implement strategies for the funding and deployment of its financial resources that are expected to maximize soundness and profitability over time at acceptable levels of risk.

Interest rate sensitivity is the potential impact of changing rate environments on both net interest income and cash flows. The Company measures its interest rate sensitivity over the near term primarily by running net interest income simulations. The sensitivity is measured against the results of a base simulation run that uses forecasts of earning assets and funding sources as of the measurement date and that assumes a stable rate environment and structure. Based on the simulation run at March 31, 2011, annual net interest income (TE) would be expected to increase approximately $4.3 million, or 1%, if interest rates instantaneously increased from current rates by 100 basis points. A comparable simulation run as of December 31, 2010 produced results that indicated an increase in net interest income (TE) of $1.0 million, or less than 1%, from a 100 basis point rate increase. The change in the simulation results reflected mainly a shift in the composition of forcasted funding sources. Although Whitney has historically tended to be moderately asset sensitive over the near term, the more recent simulations indicate a neutral to somewhat liability-sensitive position in a rising market rate scenario. This change reflects to a large extent the increased use of rate floors on variable-rate loans and the extent to which these floors exceed the indexed rates in the current low rate environment. Additional information on variable-rate loans and loans with rate floors is included in the section entitled “Net Interest Income (TE)” in the later discussion of “Results of Operations.” The simulation assuming a 100 basis point decrease from current rates was suspended at both March 31, 2011 and December 31, 2010 in light of the historically low rate environment.

The actual impact that changes in interest rates have on net interest income will depend on a number of factors. These factors include Whitney’s ability to achieve any expected growth in earning assets and to maintain a desired mix of earning assets and interest-bearing liabilities, the actual timing of the repricing of assets and liabilities, the magnitude of interest rate changes and corresponding movement in interest rate spreads, and the level of success of asset/liability management strategies that are implemented.

RESULTS OF OPERATIONS

NET INTEREST INCOME (TE)

Whitney’s net interest income (TE) for the first quarter of 2011 decreased 4%, or $4.3 million, from the fourth quarter of 2010, with the fewer days in the current period accounting for approximately $1.6 million of the decrease, other factors held constant. Average earning assets decreased 2% linked-quarter, while the net interest margin (TE) was basically stable, declining only 1 basis point to 3.98% in the first quarter of 2011. Net interest income (TE) for the first quarter of 2011 was down 6%, or $6.7 million, compared to the first quarter of 2010. Average earning assets were also down 2% between these periods, and the net interest margin (TE) in the first quarter of 2011 was down 17 basis points from the year-earlier period. Tables 14 and 15 provide details on the components of the Company’s net interest income (TE) and net interest margin (TE).

The overall yield on earning assets decreased 9 basis points from the fourth quarter of 2010 and was down 34 basis points from the first quarter of 2010. The reduced level of loans in the earning asset mix and the lower yields available on the reinvestment of repayments and maturities from the securities portfolio were the main factors behind this decrease. Loan yields (TE) in the first quarter of 2011 were down 8 basis points from 2010’s fourth quarter and 7 basis points from the year-earlier period. The rates on approximately 56%, or $3.9 billion, of the loan portfolio at March 31, 2011 vary based on either LIBOR (29%) or prime rate (27%) benchmarks. The percentages are generally consistent with those at year-end 2010 and at March 31, 2010. The Bank’s increased use of rate floors on its loan products has partially muted the impact of the overall lower rate environment on loan yields. At March 31, 2011, approximately 65% of the outstanding balance of Whitney’s LIBOR/prime-based loans was subject to rate floors compared to 62% a year earlier. The yield (TE) on the largely fixed-rate investment portfolio in the first quarter of 2011 declined 10 basis points from the fourth quarter of 2010 and 72 basis points from the year-earlier period.

The inflated level of nonaccrual loans has also reduced net interest income and lowered the effective asset yield and net interest margin in recent periods. Nonaccrual loans reduced Whitney’s net interest margin by approximately 12 basis points for the first quarter of 2011 compared to approximately 20 basis points for both the fourth and first quarters of 2010.

The cost of funds for the first quarter of 2011 decreased 8 basis points from the fourth quarter of 2010 and 17 basis points from the first quarter of 2010. These declines reflected mainly the impact of the sustained low rate environment on deposit rates. The overall cost of interest-bearing deposits was down 15 basis points between the fourth quarter of 2010 and the first quarter of 2011 and 32 basis points year over year. Short-term borrowing costs decreased only 2 and 4 basis points, respectively, over these same periods. Noninterest-bearing demand deposits funded a favorable 34% of average earning assets in the first quarter of 2011, up from both the fourth and first quarters of 2010, although the benefit to the net interest margin was somewhat muted by the low rate environment. The percentage of funding from all noninterest-bearing sources was 37% in the first quarter of 2011, up slightly from both the fourth and first quarters of 2010.

TABLE 14. SUMMARY OF AVERAGE BALANCE SHEETS, NET INTEREST INCOME(TE) (a) , YIELDS AND RATES

(dollars in thousands)	First Quarter 2011								Fourth Quarter 2010								First Quarter 2010
	Average					Yield/			Average					Yield/			Average					Yield/
	Balance			Interest		Rate			Balance			Interest		Rate			Balance			Interest		Rate
ASSETS
EARNING ASSETS
Loans (TE) (b) (c)	$	7,227,025		$	86,674		4.86	%	$	7,689,410		$	95,609		4.94	%	$	8,230,993		$	100,178		4.93	%
Mortgage-backed securities		2,353,755			19,971		3.39			2,056,548			17,712		3.44			1,677,908			17,083		4.07
U.S. agency securities		18,366			86		1.87			30,255			204		2.70			102,074			1,121		4.39
Obligations of states and political
subdivisions (TE)		150,054			2,195		5.85			157,341			2,385		6.06			176,010			2,592		5.89
Other securities		150,522			1,402		3.73			100,168			1,007		4.02			52,103			613		4.71
Total investment securities		2,672,697			23,654		3.54			2,344,312			21,308		3.64			2,008,095			21,409		4.26
Federal funds sold and
short-term investments		337,452			233		.28			447,555			302		.27			243,123			179		.30
Total earning assets		10,237,174		$	110,561		4.36	%		10,481,277		$	117,219		4.45	%		10,482,211		$	121,766		4.70	%
NONEARNING ASSETS
Other assets		1,568,352								1,522,303								1,410,946
Allowance for loan losses		(220,086	)							(228,721	)							(236,380	)
Total assets	$	11,585,440							$	11,774,859							$	11,656,777

LIABILITIES AND SHAREHOLDERS' EQUITY
INTEREST-BEARING LIABILITIES
NOW account deposits	$	1,208,317		$	647		.22	%	$	1,163,000		$	803		.27	%	$	1,247,118		$	1,120		.36	%
Money market deposits		1,823,639			1,608		.36			1,834,234			2,728		.59			1,794,820			3,613		.82
Savings deposits		916,749			193		.09			887,331			268		.12			849,006			309		.15
Other time deposits		673,057			1,726		1.04			703,277			2,092		1.18			781,806			2,680		1.39
Time deposits $100,000 and over		1,059,236			2,585		0.99			1,135,636			3,180		1.11			1,093,159			3,698		1.37
Total interest-bearing deposits		5,680,998			6,759		.48			5,723,478			9,071		.63			5,765,909			11,420		.80
Short-term borrowings		531,037			173		.13			732,669			273		.15			644,838			276		.17
Long-term debt		219,596			2,761		5.03			218,499			2,709		4.96			199,711			2,486		4.98
Total interest-bearing liabilities		6,431,631		$	9,693		.61	%		6,674,646		$	12,053		.72	%		6,610,458		$	14,182		.87	%
NONINTEREST-BEARING LIABILITIES
AND SHAREHOLDERS' EQUITY
Demand deposits		3,519,240								3,354,893								3,260,794
Other liabilities		104,738								95,491								100,988
Shareholders' equity		1,529,831								1,649,829								1,684,537
Total liabilities and
shareholders' equity	$	11,585,440							$	11,774,859							$	11,656,777

Net interest income and margin (TE)				$	100,868		3.98	%				$	105,166		3.99	%				$	107,584		4.15	%
Net earning assets and spread	$	3,805,543					3.75	%	$	3,806,631					3.73	%	$	3,871,753					3.83	%
Interest cost of funding earning assets							.38	%							.46	%							.55	%

(a) Tax-equivalent (TE) amounts are calculated using a marginal federal income tax rate of 35%.
(b) Includes loans held for sale.
(c) Average balance includes nonaccruing loans of $234,731, $409,931 and $418,742, respectively, in the first quarter of 2011 and fourth and first quarters of 2010.

TABLE 15. SUMMARY OF CHANGES IN NET INTEREST INCOME(TE) (a) (b)
	First Quarter 2011 Compared to:
	Fourth Quarter 2010									First Quarter 2010
	Due to						Total			Due to						Total
	Change in						Increase			Change in						Increase
(dollars in thousands)	Volume			Yield/Rate			(Decrease)			Volume			Yield/Rate			(Decrease)
INTEREST INCOME (TE)
Loans (TE)	$	(7,081	)	$	(1,854	)	$	(8,935	)	$	(12,046	)	$	(1,458	)	$	(13,504	)
Mortgage-backed securities		2,519			(260	)		2,259			6,059			(3,171	)		2,888
U.S. agency securities		(66	)		(52	)		(118	)		(609	)		(426	)		(1,035	)
Obligations of states and political
subdivisions (TE)		(108	)		(82	)		(190	)		(380	)		(17	)		(397	)
Other securities		472			(77	)		395			940			(151	)		789
Total investment securities		2,817			(471	)		2,346			6,010			(3,765	)		2,245
Federal funds sold and
short-term investments		(81	)		12			(69	)		66			(12	)		54
Total interest income (TE)		(4,345	)		(2,313	)		(6,658	)		(5,970	)		(5,235	)		(11,205	)

INTEREST EXPENSE
NOW account deposits		27			(183	)		(156	)		(34	)		(439	)		(473	)
Money market deposits		(16	)		(1,104	)		(1,120	)		58			(2,063	)		(2,005	)
Savings deposits		8			(83	)		(75	)		23			(139	)		(116	)
Other time deposits		(97	)		(269	)		(366	)		(339	)		(615	)		(954	)
Time deposits $100,000 and over		(227	)		(368	)		(595	)		(112	)		(1,001	)		(1,113	)
Total interest-bearing deposits		(305	)		(2,007	)		(2,312	)		(404	)		(4,257	)		(4,661	)
Short-term borrowings		(72	)		(28	)		(100	)		(44	)		(59	)		(103	)
Long-term debt		14			38			52			250			25			275
Total interest expense		(363	)		(1,997	)		(2,360	)		(198	)		(4,291	)		(4,489	)
Change in net interest income (TE)	$	(3,982	)	$	(316	)	$	(4,298	)	$	(5,772	)	$	(944	)	$	(6,716	)

(a) Tax-equivalent (TE) amounts are calculated using a marginal federal income tax rate of 35%.
(b) The change in interest shown as due to changes in either volume or rate includes an allocation of the amount
that reflects the interaction of volume and rate changes. This allocation is based on the absolute dollar
amounts of change due solely to changes in volume or rate.

There are several factors that will challenge Whitney’s ability to increase net interest income and expand the net interest margin in the near future. Continued weak loan demand will make it difficult to grow earning assets and maintain or increase the proportion of loans in the earning asset mix. The rates on many variable-rate loans with rate floors currently exceed the underlying indexed market rates. This will limit the benefit to Whitney’s loan yields from any rise in market rates as the economy recovers. Whitney continues to manage its deposit rates and funding mix to maintain a favorable net interest margin, but the ability to further reduce funding costs has become limited after a sustained period of low market rates.

PROVISION FOR CREDIT LOSSES

During the first quarter of 2011, Whitney recovered $5.8 million on a charge-off related to Hurricane Katrina taken in 2006. Based on its current assessment of the impact of the BP oil spill on the Company’s loan customers in the first quarter of 2011, management reversed the $5.0 million allowance established in the second quarter of 2010 to cover estimated losses from this event. The level of classified loans remained elevated at March 31, 2011, although the current portfolio of classified loans reflects more the normal stress on C&I and other credits associated with a slow recovery from a prolonged period of economic weakness rather than the impact of the severe real estate issues that persist in Florida and certain other areas of Whitney’s markets. As noted earlier, a large portion of the nonperforming loan portfolio was reclassified as held for sale with significant charge-offs during the fourth quarter of 2010. These loans consisted primarily of the type of real estate-related credits from certain Whitney market areas that have been the main driver of the provision for loan losses over the past two years. These actions, the Hurricane Katrina loss recovery, the reversal of the BP oil spill loss allowance and the current composition of classified loans are all reflected in management’s evaluation of the adequacy of the allowance for credit losses and decision to make no provision for credit losses in the first quarter of 2011. The provision for credit losses totaled $148.5 million in the fourth quarter of 2010 and $37.5 million in the year-earlier period. The reclassification of nonperforming loans as held for sale in the fourth quarter of 2010 had an impact of approximately $112 million on the provision in that period reflecting the cost associated with aggressively dealing with problem credits through bulk sale transactions versus individual problem credit resolutions.

For a more detailed discussion of changes in the allowance for loan losses, the reserve for losses on unfunded credit commitments, nonperforming assets and general credit quality, see the earlier section entitled “Loans, Credit Risk Management and Allowance and Reserve for Credit Losses.” The future level of the allowance and reserve and the provisions for credit losses will reflect management’s ongoing evaluation of credit risk, based on established internal policies and practices.

NONINTEREST INCOME

Noninterest income increased $2.2 million, or 8%, from the first quarter of 2010 to a total of $30.4 million in 2011’s first quarter.

Deposit service charge income in the first quarter of 2011 was down 6%, or $.5 million in total, from the first quarter of 2010. Service charges include periodic account maintenance fees for both business and personal customers, charges for specific transactions or services such as processing return items or wire transfers, and other revenue associated with deposit accounts such as commissions on check sales.

Charges earned on specific transactions and services decreased approximately $1.0 million, or 24%, compared to the first quarter of 2010. The main component of this income category is fees earned on items returned for insufficient funds and for overdrafts, and the overall decrease was mainly the result of the new consumer protection regulations implemented during the third quarter of 2010. The Company continues to monitor other regulatory proposals and legislative initiatives, including the provisions of the Dodd-Frank Act discussed earlier, that would impose limits on certain deposit and other transaction fees and potentially reduce the Bank’s fee income.

Commercial account service charges increased $.6 million, or 21%, compared to the first quarter of 2010. Approximately $.3 million of the increase came from fees earned in processing claims disbursements associated with damages caused by the BP oil spill in the Gulf of Mexico.

Bank card fees in the first quarter of 2011 were up $.9 million, or 15%, compared to the first quarter of 2010, driven primarily by higher transaction volume that was supported in part by recent marketing campaigns. This income category includes fees from activity on Bank-issued debit and credit cards as well as from merchant processing services. Under authority granted to it by the Dodd-Frank Act, the Federal Reserve proposed a new regulation in late 2010 regarding interchange fees charged for electronic debit transactions by card issuers. This regulation would establish standards for determining whether such interchange fees are reasonable and proportional to the transaction costs incurred by the issuer. The two alternative standards proposed both would result in a substantial reduction in the fee income earned on debit transactions by issuers such as Whitney. If made final, the new standards are scheduled to become effective on July 21, 2011.

The categories comprising other noninterest income increased a combined $1.7 million compared to the first quarter of 2010. There were positive contributions from most recurring revenue sources. Investment services income grew 12% reflecting the efforts of new investment advisors added to the Whitney team as well as renewed investor confidence in the financial markets. Credit-related fees increased 11% mainly from improved pricing on credit facilities for commercial customers. Net gains and other revenue from grandfathered foreclosed assets totaled $1.9 million in the first quarter of 2011 compared to $.9 million in the first quarter of 2010.

Noninterest income for the first quarter of 2011 declined $1.4 million, or 4%, from the fourth quarter of 2010. Certain recurring sources of income showed seasonal declines in the first quarter of 2011. Secondary mortgage market income was down $1.4 million on lower production levels related in part to less refinancing activity compared to the prior period. As noted earlier, the first quarter of 2011 included $1.9 million of gains on sales of grandfathered assets and other revenue from these assets. The fourth quarter of 2010 included a $.6 million distribution from an investment in a local small business investment company and $.3 million from grandfathered assets.

NONINTEREST EXPENSE

Noninterest expense decreased $1.6 million, or 1%, to a total of $108 million in the first quarter of 2011 compared to the same period in 2010. The Company recognized $1.2 million of expenses in the first quarter of 2011 associated with the recently announced merger agreement with Hancock. Noninterest expense for the first quarter of 2010 included $4.5 million for estimated losses on repurchase obligations associated with certain mortgage loans that had been originated and sold by an acquired entity before the acquisition date.

Personnel expense increased 3%, or $1.3 million, in total between these periods. Employee compensation was up 5%, or $1.9 million, reflecting in part a modest level of normal salary adjustments in this difficult operating environment and a generally stable full-time equivalent staff level. The cost of employee benefits was down 5%, or $.6 million, mainly on a lower cost of retirement benefits.

Equipment and data processing expense increased 13%, or $.8 million, compared to the first quarter of 2010. This increase related mainly to Whitney’s major technology upgrade project which has been placed on hold pending completion of integration studies in connection with the proposed merger with Hancock.

Legal and professional service fees, excluding those associated with problem loan collections, increased $2.3 million compared to the first quarter of 2010. Costs associated with regulatory matters totaled approximately $2.5 million for the first quarter of 2011 and were the main factor behind this increase.

Total noninterest expense for the first quarter of 2011 decreased $22.1 million from the fourth quarter of 2010. Expenses associated with the pending merger with Hancock totaled $1.2 million in the current period and $4.1 million in the fourth quarter of 2010. Loan collection costs, together with foreclosed asset management expenses, provisions for valuation losses on foreclosed assets and legal fees associated with problem credits totaled $8.8 million in the first quarter of 2011, down $11.7 million from the fourth quarter of 2010. As noted previously, problem loan resolution expenses were expected to be lower as the Company disposed of the loans held for sale. Legal and professional fees, excluding those associated with problem credits, declined $1.7 million from the fourth quarter of 2010, related mainly to the technology upgrade project which has been suspended in anticipation of the merger with Hancock. Other noninterest expense decreased $4.4 million compared to the fourth quarter of 2010, including a reduction of approximately $1.0 million in training expenses related to the technology upgrade project.

INCOME TAXES

Whitney provided for income tax expense at an effective rate of 22.7% for the first quarter of 2011. For the first quarter of 2010, the Company provided an income tax benefit on the pre-tax loss in that period at an effective rate of 49.1%. Whitney’s effective tax rates have varied from the 35% federal statutory rate primarily because of tax-exempt interest income and the availability of tax credits. Interest income from the financing of state and local governments and earnings from the bank-owned life insurance program are the major components of tax-exempt income. The main source of tax credits has been investments in affordable housing projects and in projects that primarily benefit low-income communities or help the recovery and redevelopment of communities in the Gulf Opportunity Zone. Tax-exempt income and tax credits tend to increase the effective tax benefit rate from the statutory rate in loss periods and to reduce the effective tax expense rate in profitable periods. The impact on the effective rate becomes more pronounced as the pre-tax income or loss becomes smaller, leading to lower expense rates and higher tax benefit rates.

Louisiana-sourced income of commercial banks is not subject to state income taxes. Rather, a bank in Louisiana pays a tax based on the value of its capital stock in lieu of income and franchise taxes, and this tax is allocated to parishes in which the bank maintains branches. Whitney’s corporate value tax is included in noninterest expense. This expense will fluctuate in part based on changes in the Bank’s equity and earnings and in part based on market valuation trends for the banking industry.

As of March 31, 2011, Whitney had $144 million in net deferred tax assets. Deferred tax assets are subject to an evaluation of whether it is more likely than not that they will be realized. Management’s evaluation is discussed in Note 17 to the consolidated financial statements in Item 1 of this quarterly report on Form 10-Q. Although Whitney generated taxable income in the first quarter of 2011, if it is unable to demonstrate that it can generate sufficient taxable income in the near future, then the Company may not be able to conclude it is more likely than not that the benefits of the deferred tax assets will be fully realized and may be required to recognize a valuation allowance against its deferred tax assets with a corresponding increase to income tax expense.

Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The information required for this item is included in the section entitled “Asset/Liability Management” in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” that appears in Item 2 of this quarterly report on Form 10-Q and is incorporated herein by reference.

Item 4.

CONTROLS AND PROCEDURES

The Company’s management, with the participation of the Chief Executive Officer (CEO) and Chief Financial Officer (CFO), has evaluated the effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended) as of the end of the period covered by this quarterly report on Form 10-Q. Based on that evaluation, the CEO and CFO have concluded that the disclosure controls and procedures as of the end of the period covered by this quarterly report are effective.

There were no changes in the Company’s internal control over financial reporting during the fiscal quarter covered by this quarterly report that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II. OTHER INFORMATION

Item 1. LEGAL PROCEEDINGS

Item 1A. RISK FACTORS

The following risk factors contain information concerning factors that could materially affect our business, financial condition or future results. The risk factors that are described below and that are discussed in Item 1A to Part 1 of Whitney’s annual report on Form 10-K for the year ended December 31, 2010 should be considered carefully in evaluating the Company’s

overall risk profile. Additional risks not presently known, or that we currently deem immaterial, also may have a material adverse affect on Whitney’s business, financial condition or results of operations.

The recent flooding crest of the Mississippi River and its tributaries, which is moving southward during May 2011, could negatively affect the local economies, businesses and property values in certain of our markets, which could have an adverse effect on our business or results of operations.

Damage from flooding in Louisiana, including flooding of the Atchafalaya River which flows west of, and parallel to, the Mississippi River, could negatively impact our customers and the general economy of part of Whitney’s market area. We cannot predict the ultimate long-term impact of the expected flooding on our current customers and the economies in our market areas, but this flooding could result in a decline in loan originations, a decline in the value of properties securing our loans and an increase in loan delinquencies, foreclosures or loan losses, which could negatively affect our financial condition and results of operations. Mitigating these impacts will be the likely impact of insurance proceeds and federal disaster assistance received by customers and their communities.

Whitney's business is highly regulated. Our compliance with existing and proposed banking legislation and regulation, including our compliance with regulatory and supervisory actions, could adversly limit or restrict our activities and adversly affect our business, operating flexibility and financial condition .

As a result of the current difficult operating environment and the Company’s recent operating losses, the Bank’s primary regulator in 2009 required the Bank to implement plans to (i) maintain regulatory capital at a level sufficient to meet specific minimum regulatory capital ratios set by the regulator; (ii) make several improvements to the Bank’s oversight of its lending operations; and (iii) assess the adequacy of the Bank’s allowance for loan and lease losses and improve related policies and procedures. The Bank’s specified minimum regulatory capital ratios are a leverage ratio of 8%, a Tier 1 Capital ratio of 9%, and a Total Capital ratio of 12%. As of March 31, 2011, the Bank’s regulatory ratios exceeded all three of these minimum ratios with an 8.65% leverage ratio, a 11.30% Tier 1 Capital ratio, and a 14.35% Total Capital ratio. In addition to meeting these capital requirements, we believe that the Bank has made progress in meeting its other commitments, including (i) the adoption of amendments to various credit policies to provide for (a) the development of a written action plan for criticized assets of $1 million or greater and (b) the timely and accurate risk ratings of loans and timely placement of loans on nonaccrual; (ii) the establishment of training programs for lending officers to ensure completion of written action plans for criticized assets and accurate risk ratings of loans and the proper financial analysis of borrowers and guarantors; and (iii) completion of an assessment of and enhancement to the methodology for determining its allowance for loan losses.

The Company’s primary regulator has also required us to take certain actions in addition to the foregoing, which include (i) obtaining regulatory approval prior to repurchasing our common stock, incurring or guaranteeing additional debt or increasing our cash dividends, (ii) providing a plan to strengthen risk management reporting and practices and (iii) providing a

capital plan to maintain a sufficient capital position and updating the plan quarterly with capital projections and stress tests.

We continue to work diligently to ensure full compliance with the requirements; however, if the Company or the Bank are unable to implement these plans in a timely manner and otherwise meet the commitments outlined above or if we fail to adequately resolve any other matters that any of our regulators may require us to address in the future, we could become subject to more stringent supervisory actions, up to and including a cease and desist order.

On February 19, 2010, Whitney announced that the Bank consented and agreed to the issuance of an order by the OCC addressing certain compliance matters relating to BSA and anti-money laundering items. The Order requires the Bank, among other things: (i) to establish a compliance committee to monitor and coordinate compliance with the Order within 30 days and to provide a written report to the OCC; (ii) to engage a consultant to assist the Board of Directors in reviewing the Bank’s BSA compliance personnel within 90 days; (iii) to develop, implement and ensure adherence to a comprehensive written program of policies and procedures that provide for BSA compliance within 150 days; (iv) to develop and implement a written, institution-wide and on-going BSA risk assessment to accurately identify risks within 150 days; and (v) for the consultant engaged by the Board of Directors to conduct a review of account and transaction activity during the calendar year 2008 for accounts that typically pose a greater than normal BSA risk. The written plan for this review was to be submitted within 90 days of the Order, and the review was to be concluded within 120 days of obtaining no supervisory objections to the written plan from the Assistant Deputy Comptroller of the OCC. Our consultant submitted its report of the 2008 review to the OCC on February 28, 2011. We believe that our consultant’s review and report satisfied the requirements of the Order as it pertained to the 2008 review, although the review revealed certain instances where Whitney should have filed Suspicious Activity Reports in 2008 (Whitney has now made the appropriate filings).

Any material failure to comply with the provisions of the Order or other OCC communications could result in further enforcement actions by the OCC. Although the Bank completed the first four items listed above within the timeframes outlined in the Order, a significant component of an effective BSA/AML program is a fully automated suspicious activity account monitoring system. Given the size and complexity of the Bank, coupled with the high volumes of wire transfer activity, the Bank’s current BSA/AML transaction monitoring software system will require significant enhancements and may warrant the Bank converting to a more robust and sophisticated BSA/AML transaction monitoring software system. Management has engaged experienced independent consultants to review the potential for successful upgrades to our current software system and to assist in the selection of a more appropriate system, if warranted. Whitney will need a fully functioning automated BSA transaction monitoring software application to satisfy our regulator prior to termination of the Order.

As a result of the supervisory actions discussed above, we are subject to additional regulatory approval processes for certain activities such as building new branches. If we are unable to resolve these regulatory issues on a timely basis, we could become subject to significant restrictions on our existing business or on our ability to develop new business. In addition, we could be required by our regulators to dispose of certain assets or liabilities within a prescribed period of time, raise additional capital in the future or restrict or reduce our dividends. The terms of any such action could have a material negative effect on our business, operating flexibility and financial condition.

Item 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

No repurchase plans were in effect during the first quarter of 2011. Under the CPP, prior to the earlier of (i) December 19, 2011 or (ii) the date on which the Series A Preferred Stock is redeemed in whole or the U.S. Treasury has transferred all of the Series A Preferred Stock to unaffiliated third parties, the consent of the U.S. Treasury is required to repurchase any shares of common stock, except in connection with benefit plans in the ordinary course of business and certain other limited exceptions.

There have been no recent sales of unregistered securities.

Item 3. DEFAULTS UPON SENIOR SECURITIES

None

Item 4. RESERVED

Item 5. OTHER INFORMATION

None

Item 6. EXHIBITS

The exhibits listed on the accompanying Exhibit Index, located on page 64, are filed (or furnished, as applicable) as part of this report. The Exhibit Index is incorporated herein by reference in response to this Item 6.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

WHITNEY HOLDING CORPORA TION

(Registrant)

By: /s/ Thomas L. Callicutt, Jr.

Thomas L. Callicutt, Jr.

Senior Executive Vice President and

Chief Financial Officer

(in his capacities as a duly authorized

officer of the registrant and as

principal accounting officer)

May 10, 2011

Date

EXHIBIT INDEX

Exhibit

Description

Exhibit 3.1

Copy of the Company’s Composite Charter (filed as Exhibit 3.1 to the Company’s current report on Form 8-K filed on December 23, 2008 (Commission file number 0-1026) and incorporated by reference).

Exhibit 3.2

Copy of the Company’s Bylaws (filed as Exhibit 3.1 to the Company’s current report on Form 8-K filed on November 2, 2010 (Commission file number 0-1026) and incorporated by reference).

Exhibit 31.1

Certification by the Company’s Chief Executive Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

Exhibit 31.2

Certification by the Company’s Chief Financial Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

Exhibit 32

Certification by the Company’s Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.