The purpose of this discussion and analysis is to focus on significant changes in the financial condition of Whitney Holding Corporation (the Company or Whitney) and its subsidiaries from December 31, 2008 to March 31, 2009 and on their results of operations during the first quarters of 2009 and 2008. Nearly all of the Company's operations are contained in its banking subsidiary, Whitney National Bank (the Bank). This discussion and analysis is intended to highlight and supplement information presented elsewhere in this quarterly report on Form 10-Q, particularly the consolidated financial statements and related notes appearing in Item 1. This discussion and analysis should be read in conjunction with the Company's annual report on Form 10-K for the year ended December 31, 2008.

FORWARD-LOOKING STATEMENTS
This discussion contains "forward-looking statements" within the meaning of section 27A of the Securities Act of 1933, as amended, and section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements provide projections of results of operations or of financial condition or state other forward-looking information, such as expectations about future conditions and descriptions of plans and strategies for the future. Forward-looking statements often contain words such as "anticipate," "believe," "could," "continue," "estimate," "expect," "forecast," "goal," "intend," "plan," "predict," "project" or other words of similar meaning.
The forward-looking statements made in this discussion include, but may not be limited to, (a) the description of Whitney's participation in the U.S. Treasury's Capital Purchase Program; (b) comments on conditions impacting certain sectors of the loan portfolio; (c) information about changes in the duration of the investment portfolio with changes in market rates; (d) statements of the results of net interest income simulations run by the Company to measure interest rate sensitivity; (e) discussion of the performance of Whitney's net interest income assuming certain conditions; (f) comments on the anticipated dividend capacity of the Bank; (g) discussion of factors affecting the growth in certain categories of noninterest income; and (h) comments on expected changes in certain categories of noninterest expense.
Whitney's ability to accurately project results or to predict the effects of plans or strategies is inherently limited. Although Whitney believes that the expectations reflected in its forward-looking statements are based on reasonable assumptions, actual results and performance could differ materially from those set forth in the forward-looking statements.
Factors that could cause actual results to differ from those expressed in the Company's forward-looking statements include, but are not limited to:
· the continued deterioration of general economic and business conditions, including the real estate and financial markets, in the United States and in the regions and communities Whitney serves;

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

· Whitney's ability to effectively manage interest rate risk and other market risk, credit risk and operational risk;

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

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

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

· changes in laws and regulations that significantly affect the activities of the banking industry and the Company's competitive position relative to other financial service providers;

· those other factors identified and discussed in Whitney's public filings with the SEC;

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

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

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

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

· the failure to attract or retain key personnel;

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

· the effectiveness of Whitney's responses to unexpected changes.

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

OVERVIEW OF RECENT TRENDS IN FINANCIAL PERFORMANCE
Whitney recorded a net loss of $11.1 million in the quarter ended March 31, 2009. Including dividends on preferred stock, the loss to common shareholders was $15.2 million or $.22 per diluted common share. The Company earned $8.2 million, or $.12 per diluted common share, for the fourth quarter of 2008 and $29.9 million, or $.45 per diluted common share, for 2008's first quarter.

Mergers and Acquisitions
On November 7, 2008, Whitney completed its acquisition of Parish National Corporation (Parish), the parent of Parish National Bank. Parish National Bank operated 16 banking centers, primarily on the north shore of Lake Pontchartrain and other parts of the metropolitan New Orleans area, and had $771 million in total assets, including a loan portfolio of $606 million, and $636 million in deposits at the acquisition date. Whitney's financial statements include the results from these acquired operations since the acquisition date.

Loans and Earning Assets
Total loans at the end of the first quarter of 2009 were down $129 million from December 31, 2008, primarily within the commercial and industrial (C&I) portfolio. As was anticipated and previously disclosed, economic conditions are restraining loan demand through the early part of 2009. Whitney continues to fund new credit relationships and renew existing ones, but the level of overall demand has been insufficient to cover paydowns and maturities, including some seasonal reductions from the end of 2008. This situation is not expected to change over the near term.
Average loans for the first quarter of 2009 were up 4%, or $368 million, compared to the fourth quarter of 2008, and earning assets increased 3%, or $335 million on average, with each increase reflecting mainly the first full-quarter impact of the Parish acquisition.

Deposits and Funding
Deposits at March 31, 2009 decreased less than 1% from December 31, 2008. Average deposits in the first quarter of 2009 were up 5%, or $472 million, compared to the fourth quarter of 2008, approximately half of which was related to the full quarter impact of Parish. A campaign targeted at acquiring new households and attracting new business accounts added approximately $200 million in money market accounts during the first quarter of 2009. Year-end deposit balances included some seasonal inflows.
Demand deposits comprised 35% of total average deposits and funded approximately 28% of average earning assets for the first quarter of 2009 and the percentage of funding from all noninterest-bearing sources totaled 33%, up from 31% in 2008's fourth quarter.
The balance of short-term borrowings at March 31, 2009, was down 29%, or $368 million, from year-end 2008, reflecting restrained loan demand, a decrease in short-term investments and some reduced liquidity in the customer base using one of Whitney's treasury-management sweep products.

Net Interest Income
Whitney's net interest income (TE) for the first quarter of 2009 decreased 7%, or $8.0 million, compared to the fourth quarter of 2008. The fewer days in the current period would have caused a reduction of approximately $1.8 million, other factors held constant. Average

earning assets grew 3% between these periods, while the net interest margin (TE) compressed by 36 basis points to 4.13%. The net interest margin in the fourth quarter of 2008 benefited an estimated 30 basis points from the abnormally wide spreads between LIBOR and other benchmark rates used to reset variable-rate loans. This benefit was reduced as the LIBOR spreads trended closer to historical relationships in the early part of 2009. Rate floors on an increasing percentage of variable rate loans partially offset the impact of the reduced spreads and the overall lower rate environment.

Provision for Credit Losses and Credit Quality Whitney provided $65.0 million for credit losses in the first quarter of 2009, compared to $45.0 million in 2008's fourth quarter. Net loan charge-offs in 2009's first quarter were $31.9 million or 1.41% of average loans on an annualized basis, compared to $19.7 million, or .91%, in the fourth quarter of 2008. The allowance for loan losses increased $33.1 million during the current quarter and represented 2.17% of total loans at March 31, 2009, up from 1.77% at year end 2008.
The total of loans criticized through the Company's credit risk-rating process was $883 million at March 31, 2009, which represented 10% of total loans and a net increase of $113 million from December 31, 2008. Of the total increase, $62 million came from C&I credits from a variety of industries mainly in Louisiana and Texas. Criticized commercial real estate (CRE) loans increased $43 million from the end of 2008, with the majority from Florida markets and concentrated in loans secured by either income-producing properties or owner-user properties. Loans for residential development, investment or other residential purposes comprised approximately 36% of the criticized loan total at March 31, 2009, over half of which were from Whitney's Florida markets.
Continuing weaknesses in residential-related real estate markets, primarily in Whitney's Florida markets, accounted for approximately $26 million of the provision for credit losses for the first quarter of 2009. These loans, which are mainly for residential development or for rental operations, also accounted for $20 million of the gross charge-offs in 2009's first quarter. Loans for CRE development or investment accounted for approximately $12 million of the provision, mainly related to further deterioration of previously criticized loans in the Tampa, Florida area. Problem C&I credits, mainly in Louisiana and Texas, added approximately $10 million to the provision for the first quarter of 2009. Management added another $10 million to the allowance and provision based on its assessment of current economic conditions and the regular qualitative and quantitative periodic reassessment of loss factors.

Noninterest Income
Noninterest income for the first quarter of 2009 increased 8%, or $2.2 million, compared to the fourth quarter of 2008. Deposit service charge income was up 7%, or $.7 million, on higher commercial account fees and the full quarter impact of Parish. Fee income from Whitney's secondary mortgage market operations grew 37%, or $.5 million, driven by refinancing activity and Parish's operations. A seasonal decline in bank card fees compared to the fourth quarter of 2008 was offset by moderate growth from several other recurring revenue sources included in other noninterest income. Other noninterest income for the first quarter of 2009 also included the $1.0 million distribution from one of the Company's grandfathered assets.

Noninterest Expense
Total noninterest expense for the first quarter of 2009 increased $4.8 million from 2008's fourth quarter. An $8.9 million increase in total personnel expense was partly offset by a $1.2 million reduction in legal and professional fees and a $3.3 million reduction in other noninterest expense items. Personnel expense for the fourth quarter of 2008 included reductions in management bonus and sales-based incentive plan compensation, which were based on updated performance estimates. The change in these two compensation categories made up $3.0 million of the $3.9 million increase in employee compensation from 2008's fourth quarter, with the remainder reflecting the full quarter impact of Parish and normal salary adjustments. Employee benefits expense increased $5.1 million from the fourth quarter of 2008. In addition to the normal rise in payroll taxes at the beginning of each year and the impact of Parish, this increase was related mainly to higher pension and other retirement benefit plan costs for 2009, as well as some fourth quarter benefit expense reductions on plan amendments.
The decline in legal and other professional fees reflected mainly $1.2 million of professional services in the fourth quarter of 2008 for the Parish system conversion.
The overall decrease in other noninterest expense categories was partly due to a $1.9 million charge during the fourth quarter of 2008 related to the planned closure of certain branch facilities in early 2009 that was approved as part of the ongoing implementation of Whitney's strategic plan. Declines in various other recurring expense categories helped offset a $1.6 million increase in FDIC insurance expense from the new higher rate structure introduced for 2009.

U.S. Treasury Department Capital Purchase Program On December 19, 2008, Whitney issued 300,000 shares of senior preferred stock to the U.S. Department of Treasury (Treasury) under the Capital Purchase Program (CPP) that was established as part of the Emergency Economic Stabilization Act of 2008 (EESA). Treasury also received a ten-year warrant to purchase 2,631,579 shares of common stock at an exercise price of $17.10 per share. The aggregate proceeds were $300 million, and the total capital raised qualifies as Tier 1 regulatory capital and can be used in calculating all regulatory capital ratios. The terms of the senior preferred stock and warrant are more fully described in Note 17 to the consolidated financial statements located in Item 8 of the Company's annual report on Form 10-K, including certain restrictions on the Company's ability to pay common dividends or repurchase stock. Further, under the EESA, Congress has the ability to impose "after-the-fact" terms and conditions on participants in the CPP. The Company cannot predict whether, or in what form, additional terms or conditions may be imposed or the extent to which the Company's business may be affected by such changes.

FINANCIAL CONDITION

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

Loan Portfolio Developments
Total loans at the end of the first quarter of 2009 were down $129 million from December 31, 2008, primarily within the commercial and industrial (C&I) portfolio. As was anticipated and previously disclosed, economic conditions are restraining loan demand through the early part of 2009. Whitney continues to fund new credit relationships and renew existing ones, but the level of overall demand has been insufficient to cover paydowns and maturities, including some seasonal reductions from the end of 2008. This situation is not expected to change over the near term.
The portfolio total at March 31, 2009 was up 16%, or $1.23 billion, from March 31, 2008, with approximately half of this increase from the Parish acquisition. Loan demand and customer development activity in Whitney's Texas and Louisiana markets were the major contributors to the organic loan growth over this period, with additional support coming from the Alabama/Mississippi market. Loans serviced from Whitney's operations in Houston, Texas grew by 26%, those serviced in Louisiana markets were up 6% excluding Parish, and the Alabama/Mississippi market gained 8%. The Florida-based portfolio was down close to 2% year over year, with market conditions continuing to restrain loan demand from the state.
Table 1 shows loan balances by type of loan at March 31, 2009 and at the end of the four prior quarters. Table 2 distributes the loan portfolio as of March 31, 2009 by the geographic region from which the loans are serviced. The following discussion provides a brief overview of the composition of the different portfolio sectors and the customers served in each, as well as recent changes.

TABLE 1. LOANS
                                         2009                 2008
                                        March December September   June  March
( in millions)                             31       31        30     30     31
Commercial & industrial                $3,328   $3,436    $3,101 $3,087 $2,897
Commercial real estate:
 Construction, land & land development  1,880    1,888     1,682  1,629  1,706
 Other commercial real estate           2,292    2,269     1,930  1,908  1,827
  Total commercial real estate          4,172    4,157     3,612  3,537  3,533
Residential mortgage                    1,046    1,079     1,003    983    950
Consumer                                  407      410       362    356    344
  Total loans                          $8,953   $9,082    $8,078 $7,963 $7,724

The portfolio of C&I loans decreased 3%, or $108 million, between year-end 2008 and March 31, 2009, reflecting economic conditions and seasonal reductions as noted above. The C&I portfolio sector was up 15%, or $431 million, compared to the end of 2008's first quarter, with only a limited contribution from the Parish acquisition. This year-over-year growth was concentrated in Whitney's Houston, Texas market and Louisiana markets, including strong growth from customers in the oil and gas (O&G) industry. In addition to the O&G industry, the C&I portfolio is diversified over a range of industries, including wholesale and retail trade in

various durable and nondurable products and the manufacture of such products, marine transportation and maritime construction, financial services, and professional services.
Loans outstanding to oil and gas (O&G) industry customers represented approximately 12% of total loans at March 31, 2009, consistent with year-end 2008. The majority of Whitney's customer base in this industry provides transportation and other services and products to support exploration and production activities. Loans outstanding to the exploration and production (E&P) sector comprised approximately 29% of the O&G portfolio at March 31, 2009, with the majority related to natural gas production based on measures of collateral support. Management continues to monitor the impact of the significant slowdown in global economic activity on commodity prices and has made what it believes to be appropriate adjustments to Whitney's credit underwriting guidelines with respect to O&G loans and the management of existing relationships. Outstanding balances under participations in larger shared-credit loan commitments totaled $810 million at the end of 2009's first quarter, compared to $772 million outstanding at year-end 2008. The total at March 31, 2009 included approximately $350 million related to the O&G industry. Substantially all of the shared credits are with customers operating in Whitney's market area. The commercial real estate (CRE) portfolio includes loans for construction and land development and investment, both commercial and residential, loans secured by multi-family residential properties and other income-producing properties, and loans secured by properties used by owners in C&I operations. Table 2 presents information on the components and geographic distribution of the CRE portfolio.

TABLE 2. GEOGRAPHIC DISTRIBUTION OF LOAN PORTFOLIO AT MARCH 31, 2009
                                                             Total Percent   Total Percent
                                                  Alabama/ Mar. 31      of Dec. 31      of
(dollars in millions)   Louisiana   Texas Florida    Miss.    2009   total    2008   total
Commercial & industrial    $2,286    $659    $106     $277  $3,328     37%  $3,436     38%
Commercial real estate:
 Residential
construction                   99      80      56       30     265    3        274     3
 Commercial
construction,
  land & land
development                   533     428     414      240   1,615   18      1,614    18
 Other CRE - owner-user       653     104     210       74   1,041   12      1,015    11
 Other CRE -
nonowner-user                 620     169     315      147   1,251   14      1,254    14
  Total commercial real
estate                      1,905     781     995      491   4,172   47      4,157    46

Residential mortgage          581     137     203      125   1,046   12      1,079    12
Consumer                      281      21      66       39     407     4       410     4
Total                      $5,053  $1,598  $1,370     $932  $8,953    100%  $9,082    100%
Percent of total              57%     18%     15%      10%    100%

The CRE portfolio sector showed little net growth during the first quarter of 2009 compared to year-end 2008. Project financing is an important component of the CRE portfolio sector. Management expects that the economic uncertainty during the current recession will slow the availability of new creditworthy CRE projects throughout Whitney's market area and limit the potential for any growth in this portfolio sector in 2009. The CRE portfolio sector grew 18%, or $639 million, from March 31, 2008, mainly from the Parish acquisition. Organic growth over

this period was mainly in the Houston, Texas market, with a smaller contribution from the Alabama/Mississippi market, and involved a variety of retail, commercial and industrial facilities, as well as some multi-family residential development.
The residential mortgage loan portfolio declined $33 million from the end of 2008 to March 31, 2009, reflecting in part the impact of attractive refinancing opportunities in the low rate environment. The 10%, or $96 million, growth in this portfolio category from a year earlier was largely related to the Parish acquisition. The Bank continues to sell most conventional residential mortgage loan production in the secondary market.

Credit Risk Management and Allowance and Reserve for Credit Losses

General Discussion of Credit Risk Management and Determination of Credit Loss Allowance and Reserve
Whitney manages credit risk mainly through adherence to underwriting and loan administration standards established by the Bank's Credit Policy Committee and through the efforts of the credit administration function to ensure consistent application and monitoring of standards throughout the Company. Lending officers are primarily responsible for ongoing monitoring and the assignment of risk ratings to individual loans based on established guidelines. An independent credit review function reporting to the Audit Committee of the Board of Directors assesses the accuracy of officer ratings and the timeliness of rating changes and performs concurrent reviews of the underwriting processes. Management's evaluation of credit risk in the loan portfolio is reflected in the estimate of probable losses inherent in the portfolio that is reported in the Company's financial statements as the allowance for loan losses. Changes in this evaluation over time are reflected in the provision for credit losses charged to expense. The methodology for determining the allowance involves significant judgment, and important factors that influence this judgment are re-evaluated quarterly to respond to changing conditions.
The recorded allowance encompasses three key elements: (1) allowances established for losses on criticized loans; (2) allowances based on historical loss experience for loans with acceptable credit quality and groups of homogeneous loans not individually rated; and (3) allowances based on general economic conditions and other qualitative risk factors internal and external to the Company.
The monitoring of credit risk also extends to unfunded credit commitments, such as unused commercial credit lines and letters of credit, and management establishes reserves as needed for its estimate of probable losses on such commitments.

Credit Quality Statistics and Components of Credit Loss Allowance and Reserve The total of loans criticized through the Company's credit risk-rating process was $883 million at March 31, 2009, which represented 10% of total loans and a net increase of $113 million from December 31, 2008. Table 3 shows the composition of criticized loans at March 31, 2009, distributed by the geographic region from which the loans are serviced.

TABLE 3. CRITICIZED LOANS AT MARCH 31, 2009
                                                                  Percent of
                                               Alabama/        loan category
(dollars in
millions)          Louisiana  Texas Florida Mississippi  Total         total
Commercial &
industrial               $73    $70     $11         $20   $174            5%
Commercial real
estate:
  Residential
construction              10     11      27           1     49           18%
  Commercial
construction,
    land & land
development               47     27     193          32    299           19%
  Other CRE -
owner-user                49     13      40          17    119           11%
  Other CRE -
nonowner-user             42     10      70          15    137           11%
    Total
commercial real
estate                   148     61     330          65    604           14%
Residential
mortgage                  30      6      44          13     93            9%
Consumer                   6      -       4           2     12            3%
Total                   $257   $137    $389        $100   $883           10%
Percent of
regional loan
total                     5%     9%     28%         11%    10%

Of the total increase of $113 million in criticized loans during the first quarter of 2009, $62 million came from C&I credits from a variety of industries mainly in Louisiana and Texas. Criticized CRE loans increased $43 million from the end of 2008, with the majority from Florida markets and concentrated in loans secured by either income-producing properties or properties used in C&I operations. The overall increase in criticized loans included $36 million related to the O&G industry and $8 million related to the hospitality sector, although management does not currently believe the stresses on these industries will have a significant impact on Whitney's overall credit quality metrics. Loans for residential development, investment or other residential purposes comprised approximately 36% of the criticized loan total at March 31, 2009, over half of which were from Whitney's Florida markets. CRE loans on nonresidential investment or income-producing properties accounted for approximately 30% of the . . .