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IBERIABANK Corp. looks to 'plant new flags' with capital raise proceeds

Lafayette, La.- based IBERIABANK Corp. is searching for ways to deploy $280 million in net proceeds from its December capital raise and is interested in "planting new flags" that fit its organizational structure.

During the company's Jan. 27 fourth-quarter earnings conference call, President and CEO Daryl Byrd said the company is interested in organic growth as well as acquisitions. Proceeds of the capital raise are being held at the holding company level, and earning interest at the current Fed funds rate, management said.

"The pipeline remains very robust. M&A conversations remain very active," Byrd said, adding the company has a few specific geographies in mind.

Management said the company remains interested in expansion in the Carolinas, noting that the recent hire of Sam Erwin as executive vice president and regional president of the company's South Carolina bank gives it an edge in the state. The company didn't say if there are any concrete plans for M&A at the moment.

Also in December, the company exited all of its loss share agreements with the FDIC.

The company struggled with mortgage income in the fourth quarter of 2016, which decreased by $5.7 million, or 26%, from the third. Senior Executive Vice President, Treasurer and CFO Anthony Restel said its hedging activities were negatively impacted, by about $1.4 million, following the post-election interest rate move.

Energy "headwinds" also presented a challenge for the company. Restel said the energy portfolio's credit quality will slowly improve, and the "drag from non-accruing energy loans the margin will slowly become a tailwind as we move through 2017."

Deposit growth, however, was stronger than expected, Restel said, adding that long-term franchise value and EPS growth in a rising interest rate environment will be driven by the "right-hand" side of the balance sheet. He attributed core deposit growth over the last year to the company's ability to generate new clients throughout its "diversified footprint."

IBERIABANK reported fourth-quarter income of $44.2 million, or $1.04 per common share, compared to $44.4, or $1.08 per common share in the year-ago period.