Common shares outstanding exclude treasury shares of 4.5 million and 4.0 million with a first-in-first-out cost basis of $150.7 million and $135.8 million at December 31, 2020 and 2019, respectively. Shares outstanding also exclude unvested restricted share awards of 1.7 million and 1.4 million at December 31, 2020 and 2019, respectively.

On September 21, 2019, the Company issued 5,044,332 shares of common stock valued at $193.8 million as consideration in its acquisition of MidSouth. Refer to Note 2 – Business Combination for further information.

On September 23, 2019, the Company’s board of directors approved an amended stock buyback program that authorized the Company to repurchase up to 5.5 million shares of its common stock through the expiration date of December 31, 2020. The program, as amended, allowed the Company to repurchase its common shares in the open market, by block purchase, through accelerated share repurchase programs, in privately negotiated transactions, or as otherwise determined by the Company in one or more transactions. The Company was not obligated to purchase any shares under this program, and the board of directors had the ability to terminate or amend the program at any time prior to the expiration date.

On October 18, 2019, the Company entered into an accelerated share repurchase (“ASR”) agreement with Morgan Stanley & Co. LLC (“Morgan Stanley”) to repurchase $185 million of the Company’s common stock. Pursuant to the ASR agreement, the Company made a $185 million payment to Morgan Stanley on October 21, 2019, and received from Morgan Stanley an initial delivery of 3,611,870 shares of the Company’s common stock, which represented 75% of the estimated total number of shares to be repurchased based on the October 18, 2019 closing price of the Company’s common stock. The value of the remaining shares to be exchanged upon final settlement was accounted for as a forward contract until settlement. Final settlement of the ASR agreement occurred on March 18, 2020. Pursuant to the terms of the settlement, the Company received cash of approximately $12.1 million and a final delivery of 1,001,472 shares.

In January 2020, the company repurchased 315,851 shares of its common stock at a price of $40.26 in a privately negotiated transaction. In total, the company repurchased approximately 4.9 million of the 5.5 million authorized shares under the buyback program at an average price of $37.65 per share.

(in thousands)	Available for Sale Securities			HTM Securities Transferred from AFS			Employee Benefit Plans			Cash Flow Hedges			Equity Method Investment			Total
Balance, December 31, 2017	$	(29,512	)	$	(14,585	)	$	(79,078	)	$	(11,227	)		—		$	(134,402	)
Net change in unrealized gain (loss)		(52,060	)		—			—			(697	)		—			(52,757	)
Reclassification of net gain (loss) realized and included in earnings		25,480			—			4,989			4,497			—			34,966
Other valuation adjustments for employee benefit plans		—			—			(45,198	)		—			—			(45,198	)
Amortization of unrealized net loss on securities transferred to held to maturity		—			3,296			—			—			—			3,296
Income tax expense (benefit)		(5,967	)		755			(9,040	)		866			—			(13,386	)
Balance, December 31, 2018	$	(50,125	)	$	(12,044	)	$	(110,247	)	$	(8,293	)		—		$	(180,709	)
Net change in unrealized gain (loss)		115,413			—			—			28,943			(434	)		143,922
Reclassification of net gain (loss) realized and included in earnings		—			—			9,174			4,255			—			13,429
Other valuation adjustments for employee benefit plans		—			—			2,398			—			—			2,398
Unrealized loss on securities transferred to available for sale		(13,236	)		13,236			—			—			—			—
Amortization of unrealized net loss on securities transferred to held to maturity		—			3,153			—			—			—			3,153
Income tax expense		23,102			3,706			2,603			7,506			—			36,917
Balance, December 31, 2019	$	28,950		$	639		$	(101,278	)	$	17,399			(434	)	$	(54,724	)
Net change in unrealized gain (loss)		183,441			—			—			45,831			(4,935	)		224,337
Reclassification of net gain (loss) realized and included in earnings		—			—			6,368			(17,351	)		—			(10,983	)
Other valuation adjustments for employee benefit plans		—			—			(37,451	)		—			—			(37,451	)
Amortization of unrealized net gain on securities transferred to held to maturity		—			(470	)		—			—			—			(470	)
Income tax expense (benefit)		41,167			(107	)		(6,788	)		6,368			—			40,640
Balance, December 31, 2020	$	171,224		$	276		$	(125,573	)	$	39,511			(5,369	)	$	80,069

Accumulated Other Comprehensive Income or Loss (“AOCI”) is reported as a component of stockholders’ equity. AOCI can include, among other items, unrealized holding gains and losses on securities available for sale (“AFS”), including the Company’s share of unrealized gains and losses reported by a partnership accounted for under the equity method, gains and losses associated with pension or other post-retirement benefits that are not recognized immediately as a component of net periodic benefit cost, and gains and losses on derivative instruments that are designated as, and qualify as, cash flow hedges. Net unrealized gains and losses on AFS securities reclassified as securities held to maturity (“HTM”) also continue to be reported as a component of AOCI and will be amortized over the estimated remaining life of the securities as an adjustment to interest income. Subject to certain thresholds, unrealized losses on employee benefit plans will be reclassified into income as pension and post-retirement costs are recognized over the remaining service period of plan participants. Accumulated gains or losses on the cash flow hedge of the variable rate loans described in Note 12 will be reclassified into income over the life of the hedge. Accumulated other comprehensive loss resulting from the terminated interest rate swaps will be amortized over the remaining maturities of the designated instruments. Gains and losses within AOCI are net of deferred income taxes, where applicable.

The following table shows the line items in the consolidated statements of income affected by amounts reclassified from AOCI:

Amount reclassified from AOCI (a)	Year Ended December 31,						Increase (decrease) in affected line
(in thousands)	2020			2019			item in the income statement
Amortization of unrealized net gain (loss) on securities transferred to HTM	$	470		$	(3,153	)	Interest income
Tax effect		(105	)		713		Income taxes
Net of tax		365			(2,440	)	Net income
Gain on sale of AFS securities		488			—		Securities transactions
Tax effect		(109	)		—		Income taxes
Net of tax		379			—		Net income
Amortization of defined benefit pension and post-retirement items		(6,368	)		(9,174	)	Other noninterest expense
Tax effect		1,390			2,074		Income taxes
Net of tax		(4,978	)		(7,100	)	Net income
Reclassification of unrealized gain or loss on cash flow hedges		18,704			(110	)	Interest income
Tax effect		(4,182	)		25		Income taxes
Net of tax		14,522			(85	)	Net income
Amortization of loss on terminated cash flow hedges		(1,353	)		(4,145	)	Interest income
Tax effect		303			937		Income taxes
Net of tax		(1,050	)		(3,208	)	Net income
Total reclassifications, net of tax	$	9,238		$	(12,833	)	Net income

On March 27, 2020, the Office of the Comptroller of the Currency (OCC), the Board of Governors of the Federal Reserve System, and the Federal Deposit Insurance Corporation issued an interim final rule that provides an option to delay the estimated impact on regulatory capital stemming from the implementation CECL for a transition period of five years. The five-year rule provides a full delay of the estimated impact of CECL on regulatory capital transition (0%) for the first two years, followed by a three-year transition (25% of the impact included in 2022, 50% in 2023, 75% in 2024 and 100% thereafter). The two-year delay includes the full impact of day one CECL plus the estimated impact of current CECL activity calculated quarterly as 25% of the current ACL over the day one balance (“modified transition amount”). The modified transition amount was and will be recalculated each quarter in 2020 and 2021, with the December 31, 2021 impact carrying through the remaining three years of the transition. The Company elected the five-year transition period option upon issuance of the interim final rule.

Measures of regulatory capital are an important tool used by regulators to monitor the financial health of financial institutions. The primary quantitative measures used to gauge capital adequacy are Common equity tier 1, Tier 1 and Total regulatory capital to risk-weighted assets (risk-based capital ratios) and the Tier 1 capital to average total assets (leverage ratio). Both the Company and the Bank subsidiary are required to maintain minimum risk-based capital ratios of 8.0% total capital, 4.5% Tier 1 Common Equity, and 6.0% Tier 1 capital. The minimum leverage ratio is 3.0% for bank holding companies and banks that meet certain specified criteria, including having the highest supervisory rating. All others are required to maintain a leverage ratio of at least 4.0%.

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 financial institutions. The framework for prompt corrective action categorizes capital levels into one of five classifications rating from well-capitalized to critically under-capitalized. For an institution to be eligible to be classified as well capitalized its total risk-based capital ratios must be at least 10.0% for total capital, 6.5% for Tier 1 Common Equity and 8.0% for Tier 1 capital, and its leverage ratio must be at least 5.0%. In reaching an overall conclusion on capital adequacy or assigning a classification under the uniform framework, regulators also consider other subjective and quantitative measures of risk associated with an institution. The Company and the Bank were deemed to be well capitalized based upon the most recent notifications from their regulators. There are no conditions or events since those notifications that management believes would change the classifications. At December 31, 2020 and 2019, the Company and the Bank were in compliance with all of their respective minimum regulatory capital requirements.

Following is a summary of the actual regulatory capital amounts and ratios for the Company and the Bank together with corresponding regulatory capital requirements at December 31, 2020 and 2019.

	Actual				Required for Minimum Capital Adequacy				Required To Be Well Capitalized
($ in thousands)	Amount		Ratio %		Amount		Ratio %		Amount		Ratio %
At December 31, 2020
Tier 1 leverage capital
Hancock Whitney Corporation	$	2,534,049		7.88	$	1,287,103		4.00	$	1,608,878		5.00
Hancock Whitney Bank		2,607,215		8.11		1,286,059		4.00		1,607,573		5.00
Common equity tier 1 (to risk weighted assets)
Hancock Whitney Corporation	$	2,534,049		10.61	$	1,074,272		4.50	$	1,551,726		6.50
Hancock Whitney Bank		2,607,215		10.94		1,072,924		4.50		1,549,778		6.50
Tier 1 capital (to risk weighted assets)
Hancock Whitney Corporation	$	2,534,049		10.61	$	1,432,362		6.00	$	1,909,817		8.00
Hancock Whitney Bank		2,607,215		10.94		1,430,565		6.00		1,907,420		8.00
Total capital (to risk weighted assets)
Hancock Whitney Corporation	$	3,155,692		13.22	$	1,909,817		8.00	$	2,387,271		10.00
Hancock Whitney Bank		2,905,988		12.19		1,907,420		8.00		2,384,275		10.00
At December 31, 2019
Tier 1 leverage capital
Hancock Whitney Corporation	$	2,584,162		8.76	$	1,180,163		4.00	$	1,475,204		5.00
Hancock Whitney Bank		2,640,913		8.96		1,179,194		4.00		1,473,992		5.00
Common equity tier 1 (to risk weighted assets)
Hancock Whitney Corporation	$	2,584,162		10.50	$	1,107,527		4.50	$	1,599,761		6.50
Hancock Whitney Bank		2,640,913		10.74		1,106,558		4.50		1,598,362		6.50
Tier 1 capital (to risk weighted assets)
Hancock Whitney Corporation	$	2,584,162		10.50	$	1,476,702		6.00	$	1,968,936		8.00
Hancock Whitney Bank		2,640,913		10.74		1,475,411		6.00		1,967,214		8.00
Total capital (to risk weighted assets)
Hancock Whitney Corporation	$	2,929,387		11.90	$	1,968,936		8.00	$	2,461,171		10.00
Hancock Whitney Bank		2,836,138		11.53		1,967,214		8.00		2,459,018		10.00

Regulatory policy statements provide that generally, bank holding companies should pay dividends only out of current operating earnings and that the level of dividends must be consistent with current and expected capital requirements. Dividends received from the Bank have been the primary source of funds available to the Company for the payment of dividends to its stockholders. Federal and state banking laws and regulations restrict the amount of dividends the Bank may distribute to the Company

without prior regulatory approval, as well as the amount of loans it may make to the Company. Dividends paid by the Bank are subject to approval by the Commissioner of Banking and Consumer Finance of the State of Mississippi. Further, beginning January 1, 2019, a capital conservation buffer of 2.5% above each of the minimum capital ratio requirements (common equity tier 1, Tier 1, and total risk-based capital) must be met for a bank or bank holding company to be able to pay dividends.