March 18, 1996
Securities and Exchange Commission
Judiciary Plaza
450 Fifth Street, N. W.
Washington, D. C. 20549
Re: Hibernia Corporation
Current Report on Form DEF 14A
Dear Sirs:
Pursuant to Rule 14a-6( ) of the Securities Exchange Act of
1934, attached for filing via EDGAR is a definitive copy of the
proxy statement, form of proxy and all other soliciting material,
for the Company's 1996 Annual Meeting of Shareholders to be held on
April 23, 1996. These materials are first being mailed to
shareholders of the Company on March 18, 1996. We are also
simultaneously mailing for filing with the New York Stock Exchange
five copies of these materials.
Thank you for your assistance. If you have any questions in
this regard, please call me at (504) 533-2486.
Very truly yours,
/s/ PATRICIA C. MERINGER
Patricia C. Meringer
Secretary and Associate Counsel
PCM/gbp
Enclosure
cc: Joseph Lomnicky
Ron E. Samford, Jr.
Stephen D. M. Schuetz
<PAGE>
March 14, 1996
Dear Fellow Shareholder:
You are cordially invited to attend the Annual Meeting of
Shareholders of Hibernia Corporation at 10 a.m. Tuesday, April 23,
1996. A formal notice setting forth the business to come before
the meeting and a proxy statement are enclosed. The meeting will
be held in the Hibernia Center, 1111 Tulane Avenue, New Orleans,
Louisiana. Free parking will be available in the parking lot at
222 Loyola Avenue. If you park in this lot, please bring your
parking ticket stub to the meeting so that it can be validated for
you.
At the meeting you will be asked to elect five directors, each
for a three-year term, and to ratify the appointment of Ernst &
Young LLP as independent auditors for 1996. Your Board of
Directors recommends a vote "FOR" each proposal.
Regardless of the number of shares you own, it is very
important that you vote them at the meeting, either in person or by
proxy. Whether or not you are able to attend, please take a moment
now to sign, date and mail the enclosed proxy in the postage-paid
envelope so that your vote may be counted.
Thank you for your cooperation and continued support.
Sincerely,
/s/ STEPHEN A. HANSEL
Stephen A. Hansel
President
and Chief Executive Officer
<PAGE>
PROXY PROXY
HIBERNIA CORPORATION
P. O. Box 61540 New Orleans, Louisiana 70161
SOLICITED BY BOARD OF DIRECTORS
FOR ANNUAL MEETING, APRIL 23, 1996
The undersigned hereby appoints Susan Klein, Patricia C.
Meringer and Gary L. Ryan, or any of them (each with full power to
act alone and with power of substitution), proxies for the
undersigned to vote all shares of Hibernia Corporation (the
"Company") that the undersigned is entitled to vote at the Annual
Meeting of Shareholders of the Company to be held in the Auditorium
of the Hibernia Center, 1111 Tulane Avenue, New Orleans, Louisiana,
at 10:00 a.m. on Tuesday, April 23, 1996, and at any adjournment or
postponement thereof, as indicated on the reverse of this proxy,
and, in their discretion, on such other matters as may properly
come before the meeting, and the undersigned acknowledges receipt
of the Company's notice and accompanying Proxy Statement.
This proxy, when properly executed, will be voted in the
manner directed herein by the undersigned shareholder. If no
direction is given, this proxy will be voted "FOR" the nominees
named in Proposal 1 (including any substitute nominee) and "FOR"
Proposal 2. All shareholders are encouraged to read the Proxy
Statement that accompanies this proxy card carefully for further
information concerning each of the Proposals.
1. ELECTION OF DIRECTORS
(a) ____ FOR all nominees listed below, except as
otherwise indicated.
(b) ____ WITHHOLD AUTHORITY to vote for all nominees
listed below.
INSTRUCTION: If you wish to withhold authority selectively to vote
for any individual nominee, strike a line through the nominee's
name below:
NOMINEES TO SERVE UNTIL THE 1999 ANNUAL MEETING OF SHAREHOLDERS:
Robert T. Holleman, Hugh J. Kelly, Sidney W. Lassen, William C.
O'Malley, Janee M. "Gee" Tucker
<PAGE>
2. PROPOSAL TO RATIFY THE APPOINTMENT OF ERNST & YOUNG LLP
AS INDEPENDENT AUDITORS FOR HIBERNIA CORPORATION, THE
BOARD OF DIRECTORS, HOWEVER, RESERVING THE RIGHT TO
CHANGE INDEPENDENT AUDITORS.
____ FOR (b) ____ AGAINST (c) ____ ABSTAIN
The undersigned hereby revokes all
proxies heretofore given in
connection with the 1996 Annual
Meeting.
PLEASE SIGN, DATE AND RETURN IN
ENCLOSED ENVELOPE
Dated:___________ __, 1996
Note: Please sign exactly as
name(s) appear(s) above. Joint
owners should each sign. When
signing as attorney, executor,
administrator, trustee or guardian,
please give full title as such.
ii
<PAGE>
[INCLUDED ON CARDS SENT TO HIBERNIA EMPLOYEES]
TWO HIBERNIA BENEFITS CAN HELP YOU
WITH YOUR RETIREMENT PLANNING
RETIREMENT SECURITY PLAN (RSP)
Always one of the most popular employee benefits, the RSP now can
be an even more attractive way to build a retirement nestegg.
- - Choose from eight investment funds, twice as many as before:
Life Cycle Funds managed by Federated Retirement Plan Services and
Hibernia funds.
- - Receive a dollar from Hibernia for every dollar you contribute,
at no cost to you.
- - Reach 100% vesting in five years.
- - Divide your RSP dollars among funds in 10% increments instead of
25%.
- - Transfer funds daily and track the value of your investments, all
by using a toll-free telephone number.
EMPLOYEE STOCK OWNERSHIP PLAN (ESOP)
Hibernia's ESOP allows the company to recognize your faithful
service by helping you build a portfolio of Hibernia stock. It
costs you nothing.
- - Contributions to your account come completely from Hibernia.
- - Hibernia stock is allocated to your account in proportion to your
total compensation, including salary, bonuses and overtime.
- - Balances are vested 100% after five years.
- - Enrollment is automatic on the first day of the calendar quarter
after 12 months of service.
For more information, call Benefits at 504-533-5517, or Ext. 35517.
HIBERNIA
CORPORATION
iii
<PAGE>
[INCLUDED ON CARDS SENT TO REGISTERED HOLDERS]
FOR ALL THE ANSWERS ABOUT YOUR HIBERNIA STOCK...
Chemical Mellon Shareholder Services*, which maintains shareholder
records for Hibernia, can answer a variety of questions about your
account and provide other services, too.
Just call or write if you want to:
- - Change your address
- - Report lost or stolen dividend checks or stock certificates
- - Receive tax information
- - Participate in the dividend reinvestment plan
- - Change the name in which stock is registered, or make a gift of
your stock
- - Consolidate accounts
- - Eliminate duplicate mailings
- - Verify the number of shares you own
- - Make optional cash payments to purchase additional Hibernia stock
IT'S EASY
Just call toll-free: 800-814-0305
Or write to: Chemical Mellon Shareholder Services
Securityholder Relations Department
85 Challenger Road, Overpeck Centre
Ridgefield Park, NJ 07660
For information on Hibernia's dividend reinvestment and stock
purchase plan, write to:
Chemical Mellon Shareholder Services
Dividend Reinvestment Department
P. O. Box 750
Pittsburgh, PA 15230-9625
HIBERNIA
CORPORATION
*Chemical Mellon Shareholder Services is transfer agent, registrar,
paying agent, exchange agent and reinvestment plan agent for the
stock of Hibernia Corporation.
GET YOUR HIBERNIA DIVIDENDS EVEN FASTER WITH DIRECT DEPOSIT
To sign up or receive information, call toll-free:
800-814-0305
iv
<PAGE>
HIBERNIA CORPORATION
P. O. Box 61540
New Orleans, Louisiana 70161
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
April 23, 1996
TO HIBERNIA SHAREHOLDERS:
Notice is hereby given that the Annual Meeting of Shareholders
of Hibernia Corporation (the "Company") will be held in the
Auditorium of the Hibernia Center, 1111 Tulane Avenue, New Orleans,
Louisiana, at 10:00 a.m. on Tuesday, April 23, 1996, for the
following purposes:
1. Election of five persons to serve as Directors of the
Company until the 1999 Annual Meeting of Shareholders or
until their successors are elected and qualified.
2. Ratification of the appointment of Ernst & Young LLP as
independent auditors for the Company for 1996.
3. Such other business as may properly come before the
meeting or any adjournment or postponement thereof.
Only shareholders of record at the close of business on March
1, 1996 are entitled to notice of and to vote at the meeting or any
adjournment or postponement thereof.
All shareholders are encouraged to read the accompanying Proxy
Statement carefully for further information concerning the
proposals that will be presented at the Annual Meeting and prior to
completion of the enclosed proxy card.
Please sign and date the enclosed proxy and return it in the
envelope provided as promptly as possible. A proxy may be revoked
at any time, as described in the accompanying Proxy Statement.
By Order of the Board of Directors
Patricia C. Meringer
Secretary
New Orleans, Louisiana
March 14, 1996
<PAGE>
HIBERNIA CORPORATION
P.O. Box 61540
New Orleans, Louisiana 70161
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
April 23, 1996
PROXY SOLICITATION AND VOTING OF PROXIES
Your proxy is solicited by the Board of Directors (the "Board
of Directors" or "Board") of Hibernia Corporation (the "Company")
for use at the Annual Meeting of Shareholders (the "Annual
Meeting") to be held on Tuesday, April 23, 1996 in the Auditorium
of the Hibernia Center, 1111 Tulane Avenue, New Orleans, Louisiana
and any adjournment or postponement thereof. This Proxy Statement
is being furnished in connection with the Annual Meeting.
Only shareholders of record as of the close of business on
March 1, 1996 are entitled to notice of and to vote at the Annual
Meeting or any adjournment or postponement thereof. As of that
date, there were 122,078,786 shares of Class A Common Voting Stock,
no par value (the "Common Stock") issued, 122,078,311 shares of
Common Stock outstanding, constituting the only class of
outstanding voting securities, and 455 shares of Common Stock held
in the Company's Treasury. Each share is entitled to one vote on
all matters to come before the meeting.
To the best knowledge of the Board of Directors of the
Company, as of March 14, 1996, no individual or group of
individuals has reported to the Securities and Exchange Commission
that he or they beneficially owned more than 5% of the Company's
outstanding Common Stock except as described below.
The Prudential Insurance Company of America ("Prudential")
filed a Schedule 13G with the Securities and Exchange Commission
("SEC") on September 9, 1993 and amended that Schedule on February
9, 1996 stating that, as of December 31, 1995, Prudential
beneficially owned more than 5% of the Company's outstanding Common
Stock. Prudential's filing states that it beneficially owned
6,932,815 (5.7%) shares of the Company's Common Stock (which
includes the shares owned by Jennison discussed below), primarily
through separate accounts, externally managed accounts, registered
investment companies, subsidiaries and/or affiliates. Jennison
Associates Capital Corp., a subsidiary of Prudential, has filed a
<PAGE>
separate Schedule 13G, which was amended on February 1, 1996 and
indicated that Jennison beneficially owned 6,835,000 shares (5.6%)
of the Company's Common Stock at that time, which shares are
included in the shares disclosed in Prudential's Schedule 13G.
Both filings certify that those securities were acquired in the
ordinary course of its business and not with the purpose or effect
of changing or influencing the control of the Company.
Prudential's mailing address is Prudential Plaza, Newark, New
Jersey 07102-3777.
The approximate date of mailing of this Proxy Statement and
the accompanying form of proxy is March 14, 1996.
Shares of Common Stock represented by any unrevoked proxy in
the accompanying form, if properly executed and received prior to
the Annual Meeting, will be voted as specified in that proxy.
Proxies for which no specification is made will be voted FOR the
election of the nominees listed herein under "Election of
Directors" and in favor of Proposal 2.
Shares represented by a proxy that is marked "Abstain" as to
any proposal will not be considered a vote in favor of or against
the proposal so marked. Broker nonvotes (in which brokers fail to
vote shares on behalf of beneficial owners) will not be treated as
present or represented at the meeting.
A proxy is revocable by written notice to the Secretary of the
Company at any time prior to its exercise or by delivery of a later
dated proxy. A proxy may also be revoked by a shareholder
attending and voting in person at the meeting.
VOTING PROCEDURES
Election of Directors. Directors are elected by a plurality
of the votes of the shares present in person or represented by
proxy at the Annual Meeting. Consequently, only shares that are
voted in favor of a particular nominee will be counted toward that
nominee's achievement of a plurality. Shares present at the
meeting that are not voted for a particular nominee or shares
present by proxy as to which the shareholder properly withheld
authority to vote for the nominee (including broker nonvotes) will
not be counted toward the nominee's achievement of a plurality.
Other Matters. For purposes of the Annual Meeting, the
affirmative vote of the majority of the shares of Common Stock
present in person or represented by proxy at the meeting for a
particular matter is required for the matter to be deemed an act of
the shareholders. With respect to abstentions, the shares are
considered present at the meeting for the proposal, but, because
they are not affirmative votes for approval of the proposal, they
will have the same effect as votes cast against the proposal. With
respect to broker nonvotes, the shares are not considered present
at the Annual Meeting for the proposal as to which the broker
withheld authority. Consequently, broker nonvotes are not counted
<PAGE>
with regard to the proposal, but they have the effect of reducing
the number of affirmative votes required to approve the proposal,
because they reduce the total number of shares present or
represented, from which a majority is calculated.
ELECTION OF DIRECTORS
Shareholders of the Company are being asked to elect five
individuals to serve as Directors of the Company until the 1999
Annual Meeting of Shareholders or until their respective successors
have been duly elected and qualified. These individuals are
identified below.
Pursuant to the Bylaws of the Company, the Board of Directors
has fixed the number of Directors at 22 divided into three
approximately equal classes with terms expiring in successive
years. Upon the retirement of Messrs. Amoss, Goodwin and
Williamson at the Annual Meeting, discussed below, the number of
Directors will be reduced to 19.
Under the Company's Bylaws, a Director who has attained the
age of 71 is generally required to retire at the next Annual
Meeting of Shareholders. Under certain circumstances the Board of
Directors may permit a Director to remain in office beyond that
time and until expiration of his term as a Director.
W. James Amoss, Jr., Robert L. Goodwin and Ernest L.
Williamson have reached the age of 71 and, pursuant to the Bylaws
of the Company, will retire as Directors as of the Annual Meeting.
The Board of Directors has nominated the five individuals who
are listed below under the caption "Nominees for Election Until
1999 Annual Meeting" to serve as Directors until the 1999 Annual
Meeting. All these persons are currently Directors of the Company,
and three of these individuals were elected by the shareholders at
previous annual meetings.
Mr. O'Malley and Mrs. Tucker were elected to the Board on May
23, 1995 to fill vacancies created when the Board increased the
number of Directors on that day.
Certain information concerning the nominees and those
Directors whose terms of office continue after the 1996 Annual
Meeting is set forth below. Should any nominee for election as a
Director be unable or unwilling to serve, the persons named in the
accompanying proxy will vote for the other nominees and any
substitute nominees as may have been nominated by the Board of
Directors. The Board has no reason to believe that any nominee
will be unable or unwilling to serve.
<PAGE>
<TABLE>
<CAPTION>
Nominees for Election until 1999 Annual Meeting
<S> <C> <C> <C>
Name, age, present position, Amount and
principal occupation and Year first nature of
directorships in other became beneficial Percent
public companies (1) Director (2) ownership (3) of Class
Robert T. Holleman (65) 1986 51,898 (4) *
Independent Geologist (oil
and gas exploration). Chair-
man, CamAm Industries, USA, Ltd.
Chairman of Hibernia National Bank's
Lafayette City Board of Directors
Hugh J. Kelly (70) 1978 23,380 (4) *
President, Chief Executive
Officer and Director (Retired),
Ocean Drilling & Exploration
Company (oil and gas exploration
and production, offshore contract
drilling and diving). Director,
Central Louisiana Electric Company,
Chieftain International, Inc.
and Tidewater Inc.
Sidney W. Lassen (61) 1985 249,204 (5)(6) *
Chairman of the Board and
Chief Executive Officer,
Sizeler Realty Co., Inc.
(shopping center development) and
Sizeler Property Investors, Inc.
(real estate investment trust).
William C. O'Malley (59) 1995 6,000 (7) *
Chairman of the Board and
Chief Executive Officer,
Tidewater Inc. (offshore marine
transportation, air and gas
compression services, shipyard
facilities and containerized shipping).
Janee M. "Gee" Tucker (49) 1995 5,116 (7) *
President and Chief Operating
Officer, Tucker and Associates, Inc.
(management consulting).
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Directors Whose Terms Continue After 1996 Annual Meeting
Directors Whose Terms Continue Until the 1997 Annual Meeting
<S> <C> <C> <C>
Name, age, present position, Amount and
principal occupation and Year first nature of
directorships in other became beneficial Percent
public companies (1) Director (2) ownership (3) of Class
J. Terrell Brown (56) 1986 22,736 (4)(8) *
President, Chief Executive
Officer and Director,
United Companies
Financial Corporation
(financial services). Director,
Sizeler Properties.
Dick H. Hearin (61) 1986 92,781 (4)(9) *
Managing Partner, Hearin
Properties (real estate
investments).
Donald J. Nalty (62) 1966 260,422 (10) *
Vice Chairman and Director of
Hibernia Corporation and
Hibernia National Bank.
Robert T. Ratcliff (53) 1994** 13,928 (11) *
President and Chief Executive
Officer, Ratcliff Construction
Company, Inc. (commercial and
industrial construction). Director,
Central Louisiana Electric Company, Inc.
Virginia E. Weinmann (66) 1994*** 35,762 (12) *
Personal Investments and
Proprietor, Waverly Enterprises
(investments).
Robert E. Zetzmann (67) 1965 203,781 (4) *
Properties and Investments.
Prior to October 1990,
Mr. Zetzmann was President,
Zetz 7-Up Bottling Co., Inc.
(manufacturer and distributor
of carbonated beverages).
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Directors Whose Terms Continue Until the 1998 Annual Meeting
<S> <C> <C> <C>
Name, age, present position, Amount and
principal occupation and Year first nature of
directorships in other became beneficial Percent
public companies (1) Director (2) ownership (3) of Class
Robert H. Boh (65) 1968 89,121 (4)(13) *
Chairman, and former President
and Chief Executive
Officer, Boh Bros.
Construction Co., LLC
and Boh Company LLC (construction).
Director, Tidewater Inc. and BellSouth
Telecommunications, Inc.
J. Herbert Boydstun (49) 1994 487,398 (14) *
Chairman, Northeast and
South Central Regions,
Hibernia Corporation and
Hibernia National Bank.
Previously, from 1982 to 1994,
President and Director
First National Bank of
West Monroe and its holding
company, First Bancorp of
Louisiana, Inc.+
E. R. "Bo" Campbell (55) 1995 4,456,901 (15) 3.65%
Chairman, Northwest Region,
Hibernia Corporation and
Hibernia National Bank.
Previously, from 1977 to 1992,
President, and from 1992 to 1994,
Chairman of the Board,
Pioneer Bank & Trust Company
(Shreveport) and its holding
company, Pioneer Bancshares
Corporation.++
Richard W. Freeman, Jr. (57) 1981 67,006 (4) *
Personal Investments and
Proprietor, Oak Hill Ranch
(livestock ranching). Director,
WHIMS, Inc. (livestock herd
management computer software).
Managing Partner, Tidewater Enter-
prises (real estate).
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Stephen A. Hansel (48) 1992 1,354,630 (16) *
President and Chief Executive
Officer, Hibernia Corporation
and Hibernia National Bank.
Previously, from 1985 to 1992,
Senior Executive Vice President
and Chief Financial Officer,
Barnett Banks, Inc., Jacksonville,
Florida (multi-bank holding company).
Elton R. King (49) 1994 7,662 (7)(17) *
President - Louisiana
BellSouth Telecommunications, Inc.
(public utility).
Duke Shackelford (69) 1994 214,784 (7)(18) *
President
Shackelford Co., Inc.,
Bastrop, Louisiana+++
(cotton production and
distribution). Director,
Entergy Corporation.
James H. Stone (70) 1983 8,938 (19) *
Chairman of the Board and
Chief Executive Officer,
Stone Energy Corporation
(oil and gas exploration and
production). Director, Newpark
Resources, Inc.
<FN>
+ Mr. Boydstun was elected to the Board after First Bancorp of Louisiana, Inc. merged with and into the
Company.
++ Mr. Campbell was elected to the Board after Pioneer Bancshares Corporation merged with and into the
Company.
+++ Mr. Shackelford was elected to the Board after Bastrop National Bank was merged with and into the Bank.
** Mr. Ratcliff has been a member of Hibernia National Bank's Alexandria City Board of Directors since
1987.
*** Mrs. Weinmann served as a Director of the Company from 1977-1989 and resigned from the Board at that
time for personal reasons.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Certain Executive Officers
<S> <C> <C>
Robert W. Close 107,666 (20) *
K. Kirk Domingos III 57,054 (21) *
B.D. Flurry 32,765 (22) *
J. Herbert Boydstun ****
All Directors and Named Executives
As a Group 7,848,933 6.35%**
<FN>
_______________________
* Less than 1 percent
**** Mr. Boydstun is also a Director; see his listing elsewhere.
** Calculated based upon the actual number of shares outstanding on
March 1, 1996 plus the shares subject to currently exercisable options.
All share amounts included in the foregoing table include shares
which the individual has the right to acquire within 60 days of the date
of this Proxy Statement. For purposes of this table, options are
currently exercisable if they are exercisable within this time period.
Information is given for the executive officers listed in the
Summary Compensation Table on page 10 who are the four highest paid
executive officers of the Company and its subsidiaries other than Mr.
Hansel, who is also a Director. Information for Mr. Hansel is included
elsewhere in this stock ownership table. The executive officers listed
here, including Mr. Hansel, are sometimes referred to in this Proxy
Statement as the "named executives."
(1) Except as otherwise indicated, all Directors and nominees
held the position(s) indicated or another senior executive position with
the same entity, one of its affiliates or a predecessor corporation for
the past five years.
(2) Year given is year in which the individual first became a
Director of the Company or of Hibernia National Bank.
(3) Except as otherwise indicated, stock ownership information
given is as of March 1, 1996.
(4) Includes options to purchase 8,321 shares which are currently
exercisable.
(5) Includes options to purchase 6,766 shares which are currently
exercisable.
(6) Includes 4,703 shares and 4,902 shares, respectively, held by
each of two trusts of which Mr. Lassen is a trustee and as to which Mr.
Lassen has sole voting power. Mr. Lassen disclaims beneficial ownership
of the shares held by these trusts. Also includes 5,491 shares owned by
Mr. Lassen's wife as to which he disclaims beneficial ownership, 71,088
shares beneficially owned by a limited liability company of which Mr.
Lassen is the operating manager and in which his wife owns an approximate
26% interest and 71,088 shares beneficially owned by a limited
partnership of which Mr. Lassen is the manager of the general partner
and in which Mr. Lassen's wife owns an approximate 27% interest.
(7) Includes options to purchase 5,000 shares which are
currently exercisable.
(8) Includes 14,166 shares owned by a corporation as to which Mr.
Brown shares voting and investment power.
(9) Includes 386 shares held by a corporation of which Mr. Hearin
is President and as to which he has sole voting and investment power. Also
includes 1,584 and 20,932 shares held in trusts of which Mr. Hearin is
co-trustee with Hibernia National Bank. Mr. Hearin disclaims beneficial
ownership of the shares held in those trusts.
(10) Includes 45,292 shares credited to Mr. Nalty as of December
31, 1995 under the Company's Retirement Security Plan, Annual Stock Bonus
Plan, Tower Stock Bonus Account and Pension Equalization Plan, options to
purchase 58,836 shares that are currently exercisable and 6,601
shares of restricted stock over which Mr. Nalty has sole voting power and
limited dispositive power.
(11) Includes 6,300 shares owned by a corporation of which Mr. Ratcliff
is president and chief executive officer. Also includes options to purchase
7,500 shares which are currently exercisable.
(12) Includes 3,397 shares held in Mrs. Weinmann's son's name but
owned beneficially by Mrs. Weinmann, and 7,727 shares owned by Mrs.
Weinmann's husband as to which she disclaims beneficial ownership. Also
includes options to purchase 7,500 shares which are currently exercisable.
(13) Includes 15,742 shares owned by Mr. Boh's wife as to which he
disclaims beneficial ownership.
(14) Includes 131,101 shares held in the employee stock ownership
plan of First Bancorp of Louisiana, Inc. (which has been terminated)
and 745 shares held in the Company's Retirement Security Plan
as of December 31, 1995. Also includes 2,500 shares held as custodian for
Mr. Boydstun's daughter, 2,500 shares held as custodian for Mr. Boydstun's
son and 2,500 shares held by Jennifer Boydstun, a dependent of Mr. Boydstun.
(15) Includes 1,700 shares held in the Company's Retirement Security
Plan as of December 31, 1995 and 1,327,100 shares held by family members
over which Mr. Campbell has voting power only.
(16) Includes 35,741 shares held by Mr. Hansel's wife as to which
he disclaims beneficial ownership. Also includes 4,384 shares held as of
December 31, 1995 in the Company's Retirement Security Plan, 400 shares
held as custodian for Mr. Hansel's children, options to purchase 1,210,012
shares which are currently exercisable and 48,860 shares of restricted
stock over which Mr. Hansel has sole voting power and limited dispositive
power.
(17) Includes 504 shares held in a KEOGH Plan of which Mr. King is
the administrator.
(18) Includes 10,713 shares held in the name of Shackelford Co.,
Inc., of which Mr. Shackelford is president and 81,470 shares owned by Mr.
Shackelford's wife as to which he disclaims beneficial ownership.
(19) Includes 66 shares held in trusts for the children of Mr.
Stone as to which he disclaims beneficial ownership. Also includes options
to purchase 6,250 shares which are currently exercisable.
(20) Includes 89 shares held in the Company's Annual Stock Bonus
Plan, 19,538 shares held in the Company's Retirement Security Plan and
5,721 shares held in the Company's Pension Equalization Plan as of December
31, 1995. Also includes options to purchase 64,668 shares that are
currently exercisable, 293 shares held in trust for the benefit of, and
128 shares held by, Mr. Close's wife and 16,502 shares of restricted stock
over which Mr. Close has voting power and limited dispositive power.
(21) Includes 104 shares held as custodian for Mr. Domingos'
daughter and 92 shares held as custodian for Mr. Domingos' son. Also
includes 3,989 shares held in the Company's Retirement Security
Plan and 88 shares held in the Company's Annual Stock Bonus Plan as of
December 31, 1995, options to purchase 40,781 shares that are currently
exercisable and 10,000 shares of restricted stock over which Mr. Domingos
has voting power and limited dispositive power.
(22) Includes 12,200 shares held as custodian for Mr. Flurry's
children and 765 shares held in the Company's Retirement Security Plan as
of December 31, 1995.
</TABLE>
<PAGE>
Board Meetings and Committees
The Audit Committee of the Board of Directors of the Company
supervises the Company's internal audit function and general
auditor, directs an examination of the Company's affairs at least
annually and reviews regulatory examination reports on the Company
and its subsidiaries, internal audit reports and audit reports
issued by the Company's independent auditors. The members of this
Committee during 1995 were Messrs. Kelly (Chairman), Amoss,
Goodwin, Hearin, King, Lassen, Zetzmann and Mrs. Weinmann and,
beginning in April 1995, Mr. Holleman and, beginning in May 1995,
Mr. O'Malley. During 1995, the Audit Committee held nine meetings.
The Executive Compensation Committee of the Board of Directors
reviews and recommends salaries, bonuses and other compensation of
certain officers of the Company and its subsidiaries, reviews and
approves compensation plans and policies for employees of the
Company and its subsidiaries and administers the Company's
executive compensation plans. The Executive Compensation Committee
also supervises compliance by the Company and its subsidiaries with
laws and regulations relating to the hiring, promotion and welfare
and benefits of employees of the Company and its subsidiaries and
recommends management development and succession plans for the
Company and its subsidiaries. The members of the Executive
Compensation Committee during 1995 were Messrs. Stone (Chairman),
Brown, Goodwin, Hearin, King and Williamson and, until his
retirement in April 1995, Brooke H. Duncan; through April 1995,
Mrs. Weinmann; and, beginning in May 1995, Mr. O'Malley, each of
whom is an independent director. The Executive Compensation
Committee held six meetings during 1995.
The Executive Committee of the Board of Directors has all of the
power and authority of the Board of Directors except any power and
authority that has been delegated to another committee of the Board
or that may not by law be delegated to a committee of a board of
directors. Messrs. Boh (Chairman), Amoss, Brown, Hansel, Kelly,
Lassen and Stone and, beginning in April 1995, Mr. Campbell, were
members of the Executive Committee during 1995. The Executive
Committee held one meeting during 1995.
The Board Governance Committee of the Board of Directors was
formed in January 1995 and screens and recommends potential
candidates for membership on the Board, recommends terms of office
for directors and the number of directors to comprise the full
Board, recommends retirement policies for nonemployee directors,
reviews the performance of directors, monitors the orientation
process for new directors and reviews and recommends modifications
to the Company's system of compensation for directors. The members
of the Board Governance Committee during 1995 were Messrs. Zetzmann
(Chairman), Freeman, Kelly, King and Ratcliff and Mrs. Weinmann
and, beginning in May 1995, Mr. Holleman. The Board Governance
Committee held four meetings during 1995.
<PAGE>
The Credit Committee of the Board of Directors of Hibernia
National Bank (the "Bank"), a wholly-owned subsidiary of the
Company, oversees the Bank's lending and credit functions
including, among other things, review and approval of the overall
credit policies and procedures of the Bank and lending authorities
and exceptions. Subject to approval by the Board of Directors of
the Bank, the Credit Committee also reviews and approves policy and
methodology for the Reserve for Possible Loan Losses and certain
aspects of the Bank's strategic plans. The members of the Credit
Committee during 1995 were Messrs. Brown (Chairman), Boydstun,
Campbell, Freeman, Nalty, Ratcliff, Shackelford, Stone and
Williamson; until April 1995, Mr. Holleman; beginning in May 1995,
Mrs. Tucker; and until his retirement in April 1995, Mr. John P.
Laborde. The Credit Committee held nine meetings during 1995.
The Trust Committee of the Board of Directors of the Bank
exercises general oversight of the Trust activities of the Bank.
The members of the Trust Committee during 1995 were Messrs.
Campbell (Chairman, beginning in April 1995), Boydstun, Freeman,
Nalty and Shackelford; beginning in May 1995, Mrs. Tucker; until
their retirement in April 1995 Mr. Laborde (Chairman) and Mr.
Brooke H. Duncan; and, until April 1995, Messrs. Holleman and
Ratcliff. The Trust Committee held four meetings in 1995.
During 1995, there were ten meetings of the Company's Board of
Directors. All of the Company's Directors attended at least 75% of
the aggregate number of meetings of the Board of Directors and of
the committees of which they were members during the year.
Executive Compensation and Benefit Plans
Annual Compensation
The following table sets forth the names and positions of, and
compensation paid by, the Company and its subsidiaries during or
with respect to 1995 to the Chief Executive Officer of the Company
and each of the four most highly compensated executive officers of
the Company other than the Chief Executive Officer.
<PAGE>
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
Name and Annual Compensation Long-Term Compensation All Other Compensation
Principal Awards
Position
Securities LTIP
Underlying Payouts(1)
Options/SARs
Year Salary Bonus
<S> <C> <C> <C> <C> <C> <C>
Stephen A. Hansel(2) 1995 $500,000 468,000 125,000 $335,913 $40,382
President and 1994 450,000 405,000 656,026 39,227
Chief Executive Officer 1993 450,000 303,750 642,666 39,464
Robert W. Close(3) 1995 225,000 130,000 55,000 167,956 21,527
Senior Executive 1994 192,000 112,500 50,000 21,010
Vice President, 1993 156,000 92,000 45,000 21,195
Regional Chairman,
Southeast Louisiana
K. Kirk Domingos III(4) 1995 180,000 75,000 40,000 100,774 20,536
Senior Executive 1994 165,000 100,000 30,000 19,930
Vice President 1993 145,000 62,500 30,000 19,751
J. Herbert Boydstun(5) 1995 170,000 80,000 30,000 0 7,500
Regional Chairman, 1994 64,167 0 0 0 0
Southcentral/Northeast
Louisiana
B.D. Flurry (6) 1995 186,000 75,000 25,000 0 7,500
President/Shreveport-Bossier
<FN>
(1) The value of restricted shares awarded upon payout of the Company's
1993-94 Performance Share Awards Plan, based upon a closing price on the
day of grant of $6.875 per share.
(2) Includes in "All Other Compensation" contributions made by the Company
on behalf of Mr. Hansel to the Retirement Security Plan ("RSP") and the
actuarial value of a split-dollar life insurance policy provided by the
Company to Mr. Hansel (a portion of the premium for which is paid by Mr.
Hansel).
(3) Includes in "All Other Compensation" contributions made by the Company
on behalf of Mr. Close to the RSP and the actuarial value of a split-dollar
life insurance policy provided by the Company to Mr. Close (a portion of
the premium for which is paid by Mr. Close).
(4) Includes in "All Other Compensation" contributions made by the
Company on behalf of Mr. Domingos to the RSP and the actuarial value of a
split-dollar life insurance policy provided by the Company to Mr. Domingos
(a portion of the premium for which is paid by Mr. Domingos).
(5) Mr. Boydstun joined the Company as an executive officer in August
1994. Includes in "All Other Compensation" contributions made by the
Company on behalf of Mr. Boydstun to the RSP.
(6) Mr. Flurry joined the Company in January 1995 and became an
executive officer in February, 1996. Includes in "All Other Compensation"
contributions made by the Company on behalf of Mr. Flurry to the RSP.
</TABLE>
<PAGE>
<PAGE>
Stock Option and Stock Appreciation Rights ("SAR") Grants
The Company granted stock options to each of the named
executives during 1995, as well as to other employees of the
Company. Mr. Hansel's options were granted at the discretion of
the Executive Compensation Committee. All of the named executives
(including Mr. Hansel) and employees who received stock options
were granted options under the Long-Term Incentive Plan. All of
these stock options have vesting schedules that permit exercise of
50% of the shares to which the options relate two years after the
date of grant, as to an additional 25% of the shares three years
after the date of grant and as to the remaining shares four years
after the date of grant. The options terminate ten years after
their date of grant if they have not been previously exercised. In
addition, the options become immediately exercisable as to all
shares to which they relate upon certain changes of control of the
Company. No change of control for this purpose has occurred as of
the date of this Proxy Statement. All of the stock options granted
to all employees during 1995 were nonqualified stock options.
The Company has not granted any SARs in connection with any
outstanding options and did not grant any SARs during 1995.
The following table sets forth the stock options granted to
Messrs. Hansel, Close, Domingos, Boydstun and Flurry during 1995
and certain other information relating to those options. The
amounts included in the "Grant Date Value" column of the table are
the respective present values of the options on the date of grant,
as determined using the Black-Scholes option valuation model.
The following assumptions were used in calculating these
values:
(a) all options would be held for the entire 10-year term;
(b) a risk-free rate of 7.82%;
(c) a dividend yield of 2.6%; and
(d) stock price volatility of 30%.
The risk-free rate used is the 10-year Treasury rate on the date
the options were granted, reflecting both the 10-year term of the
options and the fact that they are being valued as of a specified
point in time (the date of grant). The value determined in
accordance with the calculation was then adjusted downward by 5% to
reflect the nontransferability of the option (because the valuation
model assumed transferability). The value was further adjusted
downward by 8.3% (3% per year) to reflect the risk of termination
of the option as a result of the extended vesting schedule.
The assumptions described above are only assumptions, and,
therefore, the actual risk-free rate, dividend yield and volatility
may vary from the model. If the actual amounts differ from the
assumptions, the value of the options shown in the table would
change as well. Consequently, the amounts included in the Grant
Date Value column of the table do not necessarily reflect either
<PAGE>
the future stock value or the amount that the named executives may
realize upon exercise of their options and/or ultimate sale of the
shares acquired in the exercise. Any gain recognized by a named
executive on exercise of his option(s) and sale of all or any
portion of the underlying shares may be greater or lesser than the
amounts shown in the table.
<PAGE>
Option/SAR Grants in Last Fiscal Year
Grant Date
Individual Grants Value
(a) (b) (c) (d) (e) (f)
% of
Number Total
of Options/
Securities SARs
Underlying Granted to Exercise Grant
Options/ Employees or Base Expira- Date
SARs in Fiscal Price tion Present
Name Granted Year ($/Sh) Date Value$
Mr. Hansel 125,000 8.07% 6.9375 1/23/05 $277,500
Mr. Close 55,000 3.55% 6.9375 1/23/05 122,100
Mr. Domingos 40,000 2.58% 6.9375 1/23/05 88,800
Mr. Boydstun 30,000 1.94% 6.9375 1/23/05 66,600
Mr. Flurry 25,000 1.61% 6.9375 1/23/05 55,500
<PAGE>
Aggregated Option/SAR Exercises and Fiscal Year-End Option/SAR
Values
None of Messrs. Hansel, Close, Domingos, Boydstun or Flurry
exercised any stock options during 1995. In addition, none of
those individuals hold any SARs, and no SARs were exercised by any
of them during 1995.
Aggregated Option/SAR Exercises and Fiscal Year-End Option/SAR
Values
Number of
Securities
Underlying
Unexercised In-the-Money
Options/SARs at Options/SARs at
Fiscal-Year End Fiscal-Year End ($) (1)
(#)
Exercisable(E)/ Exercisable(E)/
Name Unexercisable(U) Unexercisable(U)
Mr. Hansel 1,210,013(E) $ 5,264,660(E)
613,679(U) 1,971,473(U)
Mr. Close 64,668(E) 222,870(E)
91,250(U) 320,781(U)
Mr. Domingos 40,781(E) 142,821(E)
62,500(U) 221,875(U)
Mr. Boydstun 0(E) 0(E)
30,000(U) 114,375(U)
Mr. Flurry 0(E) 0(E)
25,000(U) 95,313(U)
___________________________
(1) For each option, the value is determined as follows:
[number of shares subject to option] times [$10.75 - exercise price
per share]. The $10.75 price was the closing market price of the
Company's Common Stock on December 31, 1995. As of March 1, 1996,
all of the options granted to each named executive are "in-the-
money".
Long-Term Incentive Plan Awards
The Company's 1993-94 Performance Share Awards Plan was paid
out in January 1995. At that time, awards of restricted stock were
made to senior and executive managers based upon the performance of
the Company during the 1993 and 1994 fiscal years. An aggregate of
371,094 shares of restricted stock were awarded to fifty-three
employees (including the named executives) under this plan. The
<PAGE>
value of the awards to the named executives are included in the
column entitled "LTIP Payouts" in the Summary Compensation Table
that appears on page 10 in this Proxy Statement.
In July 1995, the Executive Compensation Committee approved a
Performance Share Awards Plan that would result in the issuance of
restricted stock to the named executives and certain other members
of executive and senior management of the Company if certain
performance-based goals are met. These awards may be granted in
early 1998, but will only be awarded if the Company achieves
certain performance objectives during the three-year period ending
on December 31, 1997. The factors determining whether the awards
are earned have not been numerically weighted, consistent with the
Company's belief that all of the performance measures are
significant. However, two of the measures are "fail-safe"
measures, which, if not met, will result in no awards being granted
under the plan.
The performance measures to be analyzed in determining awards
under the plan are capital adequacy (leverage ratio), asset quality
(coverage ratio, which is the ratio of the reserve for possible
loan losses to nonperforming loans) and earnings per share.
Capital and asset quality measures are the fail-safe factors and
will be compared to the Company's peer group of bank holding
companies. Earnings per share will be measured on an absolute
basis.
In addition, the appreciation in the Company's stock price
over the period, as compared with the appreciation in the stock
prices of its peer group companies, may result in an adjustment of
the number of shares to be granted under the plan. The aggregate
number of shares to be granted under the plan may be increased by
up to 25% based on the Company's stock price appreciation. Also,
the number of shares to be granted may be reduced, in the
discretion of the Executive Compensation Committee, in any amount,
including a reduction to zero. Even if both fail-safe measures are
met, and earnings per share achieved would otherwise result in 100%
payout of the shares under the plan, the Executive Compensation
Committee has the discretion to reduce grants if the Company's
stock price performance does not compare favorably to that of its
peers. The Committee also has the discretion to make adjustments
to the individual awards to executives and senior officers based
upon changes in the job responsibilities of those individuals over
the measured period. In the event of a change of control during
the performance period, the plan will vest on a pro rata basis, and
the end of the performance period for this purpose will be the
calendar quarter immediately preceding the change of control.
Shares issued under the plan will be restricted as to
transferability during employment with the Company to prevent the
transfer of the shares except for use as payment in an exercise of
a stock option. However, tax will be due from the recipient when
the awards are granted, and the recipient will be responsible for
<PAGE>
paying those taxes, either in cash or through withholding of shares
to pay the taxes.
The following table shows the number of Performance Shares
that may be earned by the named executives pursuant to the plan.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Name Period Threshold(1) Target(2) Maximum
Mr. Hansel 1995-1997 20,500 82,000 102,500
Mr. Close 1995-1997 10,000 40,000 50,000
Mr. Domingos 1995-1997 6,875 27,500 34,400
Mr. Boydstun 1995-1997 6,875 27,500 34,400
Mr. Flurry 1995-1997 6,000 24,000 30,000
<FN>
(1) Assumes the fail-safe measures are met and that the minimum level of
earnings per share is achieved, without an adjustment upward or downward
based on stock price appreciation.
(2) Assumes the fail-safe measures are met and that the maximum level of
earnings per share is achieved, without an adjustment upward or downward
based on stock price appreciation.
</TABLE>
Compensation of Directors
During 1995, each Director of the Company who was not also an
officer of the Company or the Bank received a $12,600 retainer,
$900 for attendance at each meeting of the Board of Directors, and
$900 for attendance at each meeting of a committee of the Board of
Directors of the Company or the Bank. The Chairman of the Board of
Directors and the chairman of each committee of the Board of
Directors received $1,200 for attendance at each meeting of the
committee he chaired. Beginning in 1996 the amounts of the meeting
fees were increased to $1,200, $1,200 and $1,500, respectively, as
a result of the decrease in the number of Board meetings scheduled
to be held.
The Chairman of the Board and the Vice Chairman of the Board
are paid annual retainers of $30,000 and $25,000, respectively, in
addition to the $12,600 retainer received by all Directors
described above.
The Company maintains a deferred compensation plan for
Directors pursuant to which a Director may defer payment of fees
receivable by him or her for service as a Director, with deferred
amounts accruing interest at a rate equal to that paid by the Bank
on its retail Tower account offered to the public in the New
Orleans area.
Employment Agreements and Change of Control Arrangements
Mr. Hansel serves as President and Chief Executive Officer of
the Company pursuant to a written employment agreement with the
Company which was effective as of March 26, 1992 and which was
<PAGE>
described in detail in the Company's Proxy Statement relating to
its 1993 Annual Meeting of Shareholders.
The agreement includes an initial term of three years, with
automatic renewals each year beginning in 1993 for an additional
year. As a result, the agreement's initial term, which would have
otherwise expired in March 1995, was extended for an additional
year in each of the years from 1993-1996 and is now scheduled to
expire in March 1999. The agreement is expected to be renewed in
1997, thereby extending its term to March 2000.
None of the other named executives serves pursuant to an
employment agreement, except Mr. Boydstun and Mr. Flurry, each of
whom executed an employment agreement with the Company when the
Company merged with the respective banks of which they served as
president prior to the merger. Both contracts provide for the
payment of the annual salaries reflected in the Summary
Compensation Table, bonuses and incentives in the discretion of the
Company and entitlement to certain other benefits available to
employees in similar positions within the Company, as well as a
noncompetition agreement in favor of the Company. Each of these
contracts has a three-year term which will expire during 1997.
Each of the named executives other than Mr. Hansel has a
change of control employment agreement with the Company that, among
other things, assures the individual of at least two years'
employment (or payment for that period) in the event of a change of
control of the Company. Those agreements permit the individuals to
resign one year after the change of control and be paid for the
remaining term of the contract. Mr. Hansel's contract includes
similar provisions that protect his income through the unexpired
term of his contract in the event of a change of control of the
Company.
Additional Information with Respect to Compensation Committee
Interlocks and Insider Participation in Compensation Decisions
During 1995, the members of the Executive Compensation
Committee were Messrs. Stone (Chairman), Brown, Goodwin, Hearin,
King, Williamson and, until his retirement in April 1995, Brooke H.
Duncan; through April 1995, Mrs. Weinmann and, beginning in May,
1995, Mr. O'Malley. None of these individuals was an officer or
employee of the Company or any of its subsidiaries during 1995, and
none of these individuals is a former officer of the Company or any
of its subsidiaries.
A subsidiary of United Companies Financial Corporation
("United Companies"), of which Mr. Brown is president and chief
executive officer, makes insurance products available to the Bank
for sale to its customers, and pays the Bank commissions on sales
to Bank customers. The aggregate fee income received by the Bank
as a result of these sales during 1995 was approximately $423,357.
<PAGE>
REPORT OF THE EXECUTIVE COMPENSATION COMMITTEE
BACKGROUND AND OVERALL POLICY
The Company's current compensation program was developed in
1992 and has been refined since that time in response to the
Company's improvement in operating results and to the overall
market conditions affecting the Company's peer group of regional
banks. The primary objectives of this program have not changed
since that time and have been described in the reports of this
Committee in previous years.
Competitive Market
Executive and senior management are recruited from a national
labor market of other banking organizations. Salary rates for
these positions are developed by considering the responsibility of
each position relative to comparable positions in other
organizations of similar size that compete in similar businesses
and business lines with the Company. The CEO's compensation is
determined based upon an analysis of compensation provided by a
peer group of regional bank holding companies. This peer group is
identical to the group used to measure the Company's stock
performance in the Stock Performance Graphs that appear on pages 21
and 22 in this Proxy Statement. (See "Change in Peer Group", below
in this report for a discussion of a change in the peer group used
in 1995 from previous years.) The Committee believes that the
CEO's position is the only position that is truly comparable among
the members of the peer group, and consequently, it is the only
position within the Company that is compared solely to the peer
group for purposes of this analysis.
Middle management and professional staff are generally
recruited from financial institutions in Louisiana and surrounding
states but in some cases are recruited nationally. The Company
establishes salary rates for these positions by comparing them to
similar positions in other banks but also emphasizes the experience
level of the individual more than the size of the employing
organization in this process.
Nonexempt and supervisory positions are recruited from a local
labor market. The Company establishes salary rates relative to
other banks and similar positions (such as customer service
positions) in local companies.
Base Salaries
Consistent with its objective to minimize fixed expenses, the
Committee increases salaries for all executive and senior
management employees of the Company at a slower rate than the rate
at which comparable salaries in the market are increasing. This
principle was applied in granting salary increases, if any, in 1994
and 1995, and is expected to be applied in the future. Bonuses will
<PAGE>
occasionally be paid to entice new executive and senior managers to
join the Company, and these bonuses are considered when determining
the overall compensation for those individuals.
The compensation strategy for the Company's Senior Executive
Vice Presidents is the same as the strategy for the rest of
executive management, with salaries established at a level that
does not exceed the midpoint of the market rate for the position.
In addition, one other member of executive management was promoted
to a position that included a significant increase in
responsibilities, and his salary was adjusted to reflect that
change.
Salaries for executive management (including the named
executives) are set at a level that does not exceed the midpoint of
the market rate for the particular job. During 1995, executives
were paid at a rate that was an average of 13% below the market
rate. Senior management salaries are set at a level which during
1995 was an average of 9% below the relevant market rates.
Salaries for other employees in the Company are set within a
range of competitive rates and will be managed so that the largest
increases go to the individuals who exhibit superior performance
and those whose pay is lowest relative to the market. Total
increases for this group will be consistent with competitive trends
within the applicable market.
Annual Cash Incentives
The Committee believes that executive incentives must balance
short-term and long-term objectives and that long-term focus is
best achieved through long-term stock ownership, which is provided
through grants under the Company's Long-Term Incentive Plan.
However, to encourage short-term decisions that result in positive
long-term performance of the Company and to compensate managers for
those decisions, the Committee also believes that managers should
be rewarded through annual cash bonuses. Annual cash bonuses for
this group are not based upon the market price of the Company's
stock and therefore will not necessarily increase or decrease with
the price of the Company's stock. The factors affecting cash
bonuses paid for 1995, in addition to individual performance, are
discussed further below. (See "Company Performance in 1995.")
Similarly, the Committee believes that annual cash incentives
should balance the results achieved by an individual and the
Company's overall results. In designing annual cash incentive
plans, the Company has rewarded employees below the middle-
management level primarily based on the results of their
performance and the performance of their respective business units.
At higher levels of the organization, annual cash bonuses are based
<PAGE>
largely on the overall performance of the Company, partly on the
performance of his or her business unit and partly on an
individual's own performance. Accordingly, some incentive awards
will be paid (particularly to lower-level employees) even in years
when the Company has not met its overall performance objectives.
However, the awards granted to executive management will be most
closely related to the overall results achieved by the Company,
and, as a result, executive management is not likely to receive
significant cash incentives in years in which the Company's overall
performance has not been consistent with or better than pre-
established long- and short-term objectives.
Annual cash incentive award opportunities are designed so that
the award for target or planned performance combined with base
salary will produce cash compensation about equal to the market
median. Performance significantly exceeding planned objectives
will produce total cash compensation between the median and the
75th percentile of the market rate for competitive positions.
The total awards paid to executive and senior management and
an individual executive's specific award are not derived from
specific formulas. Rather, the Committee approves an overall total
pool of annual cash incentives. The aggregate amount of the pool
is determined based upon a number of performance factors for the
Company, including net income, asset quality, earnings per share,
capital adequacy, profitability and similar factors. The
distribution of the pool of funds among members of executive and
senior management is based upon an assessment of the performance of
each individual's business unit as well as his or her individual
performance. The CEO recommends specific awards for executive
management based upon his assessment of their business unit and
individual performance. The Committee participates in this
assessment and approves each specific award. Similarly, the
executive managers as a group evaluate the performance of each of
the senior managers and recommend awards for those individuals,
which awards are approved by the CEO.
The Company maintains a variety of other cash incentive plans
applicable to employees at all levels of the organization whose
performances have a measurable impact on business unit performance.
These are business-unit specific plans that reward sales and
service efforts, with a significant proportion devoted to retail
sales and trust and brokerage referrals.
<PAGE>
Company Performance in 1995
The Company's performance during 1995 showed continued
improvement over previous years, particularly in the key areas of
capital adequacy, asset quality and earnings per share. The
Company's leverage ratio (its primary measure of capital strength)
improved substantially from 8.90% at year-end 1994 to 9.75% at
year-end 1995. The Company's coverage ratio (the ratio of its
reserve for possible loan losses to nonperforming loans), its
leading indicator of asset quality, also improved dramatically in
1995 to 861% from 559% at year-end 1994. Finally, earnings per
share improved markedly in 1995, from $.80 at December 31, 1994 to
$1.05 at December 31, 1995. The Company's performance in two of
these categories exceeded the performance established in its profit
plan for 1995.
The Company's performance in 1995 was also marked by:
- a 30% increase in earnings to the highest level in Hibernias
history;
- a 23% increase in loans;
- an improved efficiency ratio (ratio of noninterest expense
to net interest income and fee income); and
- a 39% increase in the market value of the Company's stock
from year-end 1994 to year-end 1995.
In addition, a pending shareholder class action suit was
settled within the established reserves, eliminating a significant
contingent liability. Franchise expansion continued in 1995, with
the completion of four mergers and corresponding improvement in
loan and deposit market shares statewide. Management and service
initiatives instituted in 1995 have already begun to add value to
the Company's operations.
Cash Bonuses for 1995
Based upon the performance of the Company and the executive
managers during 1995, the Committee approved cash bonus awards
totaling $1,518,000 for the 18 members of executive management
(including the CEO). Total awards for executive management include
an award of $468,000 for Mr. Hansel. This compares to total awards
to the 18 members of executive management in 1994 of $1,437,000
(including a $405,000 award to Mr. Hansel). The basis for Mr.
Hansel's bonus is described in more detail below.
Long-Term Incentives
The Long-Term Incentive Plan which was approved by
shareholders in 1992 allows the Committee to employ a variety of
forms of incentives to accomplish its objectives. In 1995, the
Committee made grants of stock options as well as eight awards of
restricted stock. In addition, the Company's 1993-94 Performance
Share Awards Plan was paid out in 1995, resulting in grants of an
aggregate of 371,094 shares of restricted stock to 53 employees,
including the CEO.
<PAGE>
Long-term incentive grants are designed to complete the
competitive compensation package. Since cash compensation
opportunity for the Company's executive and senior management is
intentionally lower than market norms, long-term incentive grants
larger than market averages enable the Company to provide
competitive total remuneration if the Company's long-term
performance is positive. Because the long-term incentives are
stock-based, they will only provide significant additional
compensation if the market price of the Company's stock increases
over time (in the case of stock options and restricted stock
awards) or the Company meets or exceeds certain specified
performance objectives (in the case of Performance Share Awards).
The Company made eight grants of restricted stock under the
Long-Term Incentive Plan in 1995. Five of the awards covered 1,000
shares, and each of those recipients was a member of management
who, in addition to his or her ordinary responsibilities,
coordinated one or more of the mergers completed in 1995. The
remaining awards ranged from 300 shares to 700 shares each and were
awarded to other employees for their participation in special
projects of some significance to the Company's progress or other
special contributions to the success of the Company. The
restricted stock awards provide the recipient with the right to
vote the shares and to receive dividends, but the shares may not be
sold or transferred while the individual remains employed by the
Company or the Bank, except to exercise stock options.
The Performance Share Awards that constituted the 1993-94
Performance Share Awards Plan were paid out in 1995 based upon
earnings and other performance factors for the two years ending in
1994. The Plan provided for awards based on weighted performance
in net income and credit quality. A total opportunity of 381,000
shares was available to 53 employees in the plan. The payout,
based on performance, was 97.4%, or 371,094 shares.
Employee Stock Ownership Plan. In April 1995, the Board of
Directors, upon recommendation of the Committee, approved the
formation and funding of an Employee Stock Ownership Plan (ESOP).
The Company allocated $30 million to fund the ESOP, and the ESOP
borrowed funds from the Bank to make purchases of the Company's
stock for the ESOP. Payments on the loan are made with
contributions from the Bank to the ESOP, and allocations of shares
to individual accounts are made annually in the discretion of the
Plan Administrator. As of December 31, 1995, the ESOP had
purchased two million shares of the Company's Common Stock and had
allocated 222,777 shares to employee accounts. Aggregate
contributions to the ESOP during 1995 were $2,201,868. The terms
of the ESOP provide that employees' interests in their ESOP
accounts vest over a five-year period (beginning in April 1995),
with gradually increased percentages vesting each year.
<PAGE>
1995-97 Performance Share Awards Plan. The Committee also approved
a Performance Share Awards Plan in 1995 that will provide
incentives to executive and senior management to achieve certain
predetermined goals over a three-year period that are critical to
the Company's success. This plan is similar to the 93-94
Performance Share Awards Plan, with the following differences:
- payout under the new plan will be based upon the Company's
performance over a three-year, rather than a two-year,
period;
- the performance criteria have been modified slightly;
- the class of eligible participants has expanded; and
- the payout amount may be affected by shareholder value, as
measured by the market price of the Company's Common
Stock.
The new Performance Share Awards Plan was approved in July
1995. These awards may be earned based upon the performance of the
Company over the period beginning January 1, 1995 and ending
December 31, 1997, but awards will only be granted if the Company
achieves certain performance objectives during that period.
Performance below an established minimum in any of the three major
categories (earnings per share, capital adequacy and asset quality)
will result in no shares being issued. Performance measures other
than earnings per share will be based upon a comparison of the
Company's performance with its peer group. In addition to the
performance measures listed above, shareholder return will affect
the payout of these awards, and payout will be increased, and may
be decreased, to the extent that the Company's share price
appreciation ranks above or below that of the midpoint of its peer
group. Any shares which are awarded under this plan will be issued
but will be restricted as to transferability during employment with
the Company to prevent the transfer of the shares except for use as
payment in the exercise of a stock option. In the event of a
change of control during the performance period, the Plan will vest
on a pro rata basis, and the end of the performance period for this
purpose will be the calendar quarter immediately preceding the
change of control. The target number of shares to be awarded under
this plan is 862,500, which may be increased as much as 25%, or
decreased, based on shareholder return.
COMPENSATION OF THE CHIEF EXECUTIVE OFFICER
General
Mr. Hansel is compensated pursuant to the terms of an
employment contract that was executed in 1992 and is renewed
annually. The terms of the contract are consistent with the
principles of the Company's overall compensation strategy and
include:
<PAGE>
- - An annual salary of $500,000, which is slightly less than the
midpoint of the 1995 salaries provided to the CEOs of the peer
group described above. Mr. Hansel recommended that his salary be
maintained at this level for 1996, and the Committee approved that
recommendation.
- - Each year, Mr. Hansel is eligible to receive an annual bonus
of up to 90% of the midpoint of his salary range.
- - In 1995 and thereafter, all grants of stock options to Mr. Hansel
will be at the discretion of the Committee.
Evaluation of Performance
In 1995, the Committee adopted a written policy relating to
the evaluation of the CEO's performance for purposes of
compensation and related matters. The evaluation is to be
performed annually.
The policy requires consideration of both quantitative
(objective) and qualitative (subjective) criteria in the evaluation
process. Quantitative factors are stated in terms of corporate
performance goals, the achievement of which can be measured by
financial performance results included in the Company's annual
report. The performance goals for purposes of Mr. Hansel's
evaluation include the earnings per share, asset quality and
capital adequacy measures included in the 1995-97 Performance Share
Awards Plan discussed above, as well as various other significant
financial performance factors highlighted in the Company's annual
profit plan for the year in question. Quantitative factors will be
measured against peer group performance.
The qualitative factors to be used to evaluate the CEO's
performance include integrity, leadership and management of
relationships with key groups, including industry regulators,
institutional and other investors, customers, analysts and
community leaders. The policy also recognizes other significant
areas of qualitative performance for which the CEO is responsible,
including financial and accounting controls and expense management.
The policy does not assign any particular or relative weight
to any of the specific factors or to the quantitative versus the
qualitative factors.
1995 Performance and Awards
Based upon the Company's performance in 1995 (as discussed
above), and Mr. Hansel's individual performance, particularly in
the qualitative areas described above, Mr. Hansel was awarded a
bonus of $468,000 for 1995, which is 100% of the total bonus
opportunity for which he was eligible in 1995.
<PAGE>
NON QUALIFIED ELECTIVE DEFERRAL PLAN
In early 1996, the committee approved in concept a
supplemental executive retirement plan to restore "lost" 401(k) and
ESOP benefits for higher-compensated employees as a result of
federal limits on qualified plans.
CHANGE IN PEER GROUP
Prior to 1995 the Company had compared itself to a national
peer group of approximately 34 banks and bank holding companies for
purposes of compensation and for purposes of preparing the stock
performance graph used in its Proxy Statement. At the same time,
in its presentations to the Board of Directors, management compared
its financial performance to a 20-bank regional peer group (which
was reduced to 19 banks as the result of a merger) that included
bank holding companies of similar size and in the same region in
which Hibernia operates.
Beginning in 1995, the Company will use the same peer group
(the 19-bank regional peer group) for purposes of compensation, the
stock performance graph and in measuring its performance in all of
its major presentations of relative performance. The banks that
form this peer group are listed elsewhere in this Proxy Statement.
This change has the effect of lowering the salary midpoints for the
CEO and other executive officers.
Submitted by the Executive Compensation Committee of the Company's
Board of Directors.
January 22, 1996
James H. Stone, Chairman Elton R. King
J. Terrell Brown William C. O'Malley
Robert L. Goodwin E. L. Williamson
Dick H. Hearin
<PAGE>
Stock Performance Graph
The following performance graph compares the performance of
the Company's Common Stock to the S&P 500 Index and to a peer group
of 19 other regional bank holding companies with assets of between
$2.2 billion and $17.0 billion for the Company's last five fiscal
years. The graph assumes that the value of the investment in the
Company's Common Stock and each index was $100 at December 31, 1990
and that all dividends were reinvested. The bank holding companies
included in the peer group are AmSouth Bancorporation; Compass
Bancshares, Inc. (formerly Central Bancshares of the South);
Commerce Bancshares, Inc.; Cullen/Frost Bankers, Inc.; Deposit
Guaranty Corporation; First American Corporation (Tennessee); First
Commerce Corporation; First Commercial Corporation (Little Rock,
Arkansas); First Tennessee National Corporation; Hancock Holding
Company; Magna Group, Inc.; Mercantile Bancorporation, Inc. (St.
Louis, Missouri); Premier Bancorp; Regions Financial Corporation;
SouthTrust Corporation; Synovus Financial Corporation; Trustmark
Corporation; Union Planters Corporation; and Whitney Holding
Corporation.
This peer group is a different peer group than was used for
the stock performance graph that appeared in the Company's 1994
proxy statement. That peer group included 32 bank holding
companies, many of which did not have significant operations in the
region in which the Company operates or were otherwise not truly
peer companies against which the Company measures its performance.
Although the original peer group had been used for peer analysis of
compensation in 1994 and previous years, the peer group that is
used here has been historically used by the Company to measure its
financial performance. In order to utilize the same standards for
all purposes, the Company began using the same peer group for both
purposes in 1995 and intends to continue to do so in the future.
COMPARISON OF 5-YEAR CUMULATIVE TOTAL RETURN
OF HIBERNIA, PEER GROUP AND S&P 500
[Add 5-year Performance Graph]
Company/Index 1991 1992 1993 1994 1995
Hibernia 43.77 93.52 123.84 126.88 180.08
S&P 500 Index 122.63 132.91 161.32 166.90 234.93
Peer Group 181.58 263.30 295.27 295.48 449.70
<PAGE>
The graph below shows the performance of the Company as
compared to the peer group and the S&P 500 for the period beginning
April 1, 1992 and ending December 31, 1995. Management of the
Company believes that this comparison is more reflective of the
Company's performance than the five-year comparison shown above due
to the extraordinary events that affected the Company during 1991,
as well as the change in management and corporate strategy that
occurred in early 1992.
COMPARISON OF 4-YEAR CUMULATIVE TOTAL RETURN
OF HIBERNIA, PEER GROUP AND S&P 500
[add 4-year performance graph]
Company/Index 3/31/92 12/31/92 12/31/93 12/31/94 12/31/95
Hibernia $100 130.56 172.88 176.87 252.65
S&P 500 Index $100 110.39 121.47 123.07 169.27
Peer Group $100 125.20 136.80 136.85 209.94
Transactions with Related Parties
The Bank leases certain properties in which Sidney W. Lassen,
a Director of the Company, holds an interest. During 1995 the Bank
paid a total of $217,728 in rental payments on these properties.
Mr. Lassen holds a 25% interest in leased property located at 2201
Veterans Memorial Boulevard, Metairie, Louisiana and a 100%
interest in leased property located at 6305 Airline Highway,
Kenner, Louisiana. In the opinion of management of the Bank, the
terms and conditions of those leases are usual, customary and no
<PAGE>
less favorable to the Bank than would be available from
unaffiliated parties.
Indebtedness of Related Parties
Directors and executive officers of the Company, members of
their immediate families and companies with which they or members
of their immediate families are associated were customers of, and
had other transactions with, the Bank in the ordinary course of
business during 1995. All loans and commitments included in those
transactions were made on substantially the same terms, including
interest rates and collateral, as those prevailing at the time for
comparable transactions with other persons and did not involve more
than normal risk of collectibility or present other unfavorable
features.
Vote Required and Recommendation
A plurality of the votes cast at the Annual Meeting is
required for the election of Directors so that the five individuals
receiving the most votes will be elected as directors.
The Board of Directors recommends a vote "FOR" election of the
nominees listed above.
RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
Shareholders of the Company are being asked to ratify the
Company's appointment of Ernst & Young LLP as its independent
auditors for 1996, as described below.
The firm of Ernst & Young LLP, certified public accountants,
was the Company's independent auditors for the year 1995. The
Board of Directors has, subject to ratification by shareholders,
appointed Ernst & Young LLP as independent auditors for the Company
for the year 1996. Although the appointment of independent
auditors is not required to be approved by shareholders, the Board
of Directors believes it appropriate to submit this selection for
ratification by shareholders. The Board of Directors, however,
reserves the right to change independent auditors at any time
notwithstanding shareholder approval. Representatives of Ernst &
Young LLP will be present at the Annual Meeting, will have the
opportunity to make a statement if they desire to do so and will be
available to respond to appropriate questions.
<PAGE>
Vote Required and Recommendation
An affirmative vote by the holders of a majority of the shares
of Common Stock voted at the Annual Meeting is required for the
ratification of the appointment of independent auditors.
The Board of Directors recommends a vote "FOR" ratification of the
appointment of Ernst & Young LLP as independent auditors.
SOLICITATION OF PROXIES
The enclosed proxy is being solicited by the Board of
Directors of the Company. The cost of soliciting proxies in the
form enclosed will be borne by the Company. Directors, officers
and employees of the Company may, but without compensation other
than their regular compensation, solicit proxies by telephone,
telegraph or personal interview. In addition, the Company has
retained Kissel-Blake Inc. to assist in the solicitation of
proxies. The fee of Kissel-Blake is estimated not to exceed
$8,500 plus reasonable out-of-pocket costs and expenses. It is
anticipated that banks, brokerage houses and other institutions,
nominees or fiduciaries will be requested to forward proxy
materials to beneficial owners and to obtain authorization for
the execution of proxies, and the Company may, upon request,
reimburse them for their related expenses.
SHAREHOLDER PROPOSALS
Shareholders may submit proposals to be considered at the
1997 Annual Meeting of Shareholders if they do so in accordance
with applicable regulations of the Securities and Exchange
Commission. Any shareholder proposals must be submitted to the
Secretary of the Company no later than October 5, 1996 in order
to be considered for inclusion in the Company's 1997 proxy
materials.
OTHER MATTERS
As of the date of this Proxy Statement, the Board of
Directors does not know of any matters to be presented at the
Annual Meeting other than those described above. However, if
other matters are properly brought before the meeting or any
adjournment thereof, the persons named in the enclosed proxy will
vote the shares represented by them in accordance with their best
judgment pursuant to discretionary authority granted in the
proxy.
ANNUAL REPORT
The Annual Report to Shareholders containing financial
statements for the Company's 1995 fiscal year has been mailed to
shareholders prior to or with this Proxy Statement. However, the
<PAGE>
Annual Report does not form any part of the material for the
solicitation of proxies.
Upon written request by a shareholder, the Company will
provide a copy of the Company's Form 10-K Annual Report for 1995,
including the Annual Report of Shareholders, as filed with the
Securities and Exchange Commission. Requests for copies should
be addressed to Secretary, Hibernia Corporation, P. O. Box 61540,
New Orleans, Louisiana 70161.
By Order of the Board of Directors
Patricia C. Meringer
Secretary
New Orleans, Louisiana
March 14, 1996
<PAGE>
EXHIBIT A
DESCRIPTION OF STOCK PERFORMANCE GRAPH
The accompanying proxy statement includes a five-year stock
performance graph that depicts the performance of Hibernia
Corporation's common stock over a five-year period commencing in
1991 and ending in 1995 and compares that performance to the
performance of the Standard & Poor's 500 Composite Index and a
peer group of bank holding companies over the same period. The
identities of the peer group of bank holding companies are
included in the accompanying proxy statement. The graph shows
the years from 1991 through 1995 on the vertical axis and the
cumulative returns for each of Hibernia Corporation, the S&P 500
Composite Index and the peer group companies on the horizontal
axis.
The following table shows the returns for each year shown on
the horizontal axis of the graph for each of Hibernia, the S&P
500 Index and the peer group:
Company/Index 1991 1992 1993 1994 1995
Hibernia 43.77 93.52 123.84 126.88 180.08
S&P 500 Index 122.63 132.91 161.32 166.90 234.93
Peer Group 181.58 263.30 295.27 295.48 449.70
The proxy also includes a second stock performance graph,
showing the same comparisons for the period beginning April 1,
1992 and for the years 1993, 1994 and 1995. The table below
includes the returns for each year shown on the horizontal axis
for Hibernia, the S&P 500 Index and the peer group.
Company/Index 3/31/92 12/31/92 12/31/93 12/31/94 12/31/95
Hibernia $100 130.56 172.88 176.87 252.65
S&P 500 Index $100 110.39 121.47 123.07 169.27
Peer Group $100 125.20 136.80 136.85 209.94
