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Texas Capital Bancshares, Inc. Announces Operating Results for Q1 2019

April 17, 2019 4:02 PM

DALLAS, April 17, 2019 (GLOBE NEWSWIRE) -- Texas Capital Bancshares, Inc. (NASDAQ: TCBI), the parent company of Texas Capital Bank, announced earnings and operating results for the first quarter of 2019.

“We begin 2019 with strong operating results," said Keith Cargill, CEO. "Our first quarter earnings highlight improvements in key performance metrics, including positive operating leverage which we attribute to strategic initiatives put in place last year. We are confident in continuing to deliver on key strategic initiatives to diversify and reduce the cost of our deposits and build on our reputation for delivering a premier client experience, not simply transactions."

FINANCIAL SUMMARY(Dollars and shares in thousands)

Q1 2019 Q1 2018 % Change
QUARTERLY OPERATING RESULTS
Net income$82,839 $71,945 15%
Net income available to common stockholders$80,401 $69,507 16%
Diluted EPS$1.60 $1.38 16%
Diluted shares50,345 50,353 —%
ROA1.26% 1.22%
ROE13.58% 13.39%
BALANCE SHEET
LHS$1,901,637 $1,088,565 75%
LHI, mortgage finance6,299,710 4,689,938 34%
LHI17,061,590 15,741,772 8%
Total LHI23,361,300 20,431,710 14%
Total loans25,262,937 21,520,275 17%
Total assets28,383,111 24,449,147 16%
Demand deposits6,743,607 7,413,340 (9)%
Total deposits20,650,127 18,764,533 10%
Stockholders’ equity2,581,942 2,273,429 14%

DETAILED FINANCIALSFor the first quarter of 2019, net income was $82.8 million and net income available to common stockholders was $80.4 million, compared to net income of $71.9 million and net income available to common stockholders of $69.5 million for the same period in 2018. On a fully diluted basis, earnings per common share were $1.60 for the quarter ended March 31, 2019 compared to $1.38 for the same period of 2018. The increases reflect a $10.9 million increase in net income primarily driven by increases in net interest income and non-interest income for the first quarter of 2019 compared to the first quarter of 2018, partially offset by increases in the provision for credit losses and non-interest expense.

Return on common equity ("ROE") was 13.58 percent and return on average assets ("ROA") was 1.26 percent for the first quarter of 2019, compared to 11.82 percent and 1.09 percent, respectively, for the fourth quarter of 2018 and 13.39 percent and 1.22 percent, respectively, for the first quarter of 2018. The linked quarter increases in ROE and ROA for the first quarter of 2019 resulted primarily from the decrease in the provision for credit losses and increase in non-interest income, offset by the increase in non-interest expense.

Net interest income was $235.6 million for the first quarter of 2019, compared to $240.7 million for the fourth quarter of 2018 and $210.3 million for the first quarter of 2018. The linked quarter decrease in net interest income was due primarily to the decrease in day count in the quarter. The year-over-year increase in net interest income was due primarily to increases in loan yields and growth in average total loans, partially offset by increases in average interest-bearing deposits and cost of deposits. Net interest margin for the first quarter of 2019 was 3.73 percent, a decrease of 5 basis points from the fourth quarter of 2018 and an increase of 2 basis points from the first quarter of 2018. LHI, excluding mortgage finance loans, yields increased 10 basis points from the fourth quarter of 2018, and increased 68 basis points compared to the first quarter of 2018. Mortgage finance loans, excluding MCA loans, yields for the first quarter of 2019 increased 9 basis points compared to the fourth quarter of 2018 and increased 11 basis points compared to the first quarter of 2018. Total cost of deposits for the first quarter of 2019 increased 16 basis points to 1.33 percent compared to 1.17 percent for the fourth quarter of 2018, and increased 67 basis points from 0.66 percent for the first quarter of 2018.

Average LHI, excluding mortgage finance loans, for the first quarter of 2019 were $16.9 billion, an increase of $222.9 million, or 1 percent, from the fourth quarter of 2018 and an increase of $1.4 billion, or 9 percent, from the first quarter of 2018. Average total mortgage finance loans, including MCA loans, for the first quarter of 2019 were $7.1 billion, a decrease of $41.8 million, or 1 percent, from the fourth quarter of 2018 and an increase of $1.8 billion, or 33 percent, from the first quarter of 2018.

Average total deposits for the first quarter of 2019 increased $136.1 million, or 1 percent, from the fourth quarter of 2018 and increased $1.6 billion, or 8 percent, from the first quarter of 2018. Average demand deposits for the first quarter of 2019 decreased $415.3 million, or 6 percent, to $7.0 billion from $7.5 billion for the fourth quarter of 2018, and decreased $1.1 billion, or 14 percent, from the first quarter of 2018 as a result of the rising interest rate environment and the shift to interest-bearing deposits.

We recorded a $20.0 million provision for credit losses for the first quarter of 2019 compared to $35.0 million for the fourth quarter of 2018 and $12.0 million for the first quarter of 2018. The provision for the first quarter of 2019 was driven by the consistent application of our methodology. The linked quarter decrease resulted from a decrease in charge-offs during the first quarter of 2019 compared to the fourth quarter of 2018, partially offset by an increase in non-accrual loans. The total allowance for credit losses at March 31, 2019 increased to 0.93 percent of LHI, compared to 0.90 percent at December 31, 2018 and decreased from 0.98 percent at March 31, 2018. In management’s opinion, the allowance is appropriate and is derived from consistent application of the methodology for establishing reserves for the loan portfolio.

We experienced an increase in non-performing assets ("NPAs") in the first quarter of 2019 compared to the fourth quarter of 2018 and first quarter of 2018. The ratio of total NPAs to total LHI plus other real estate owned ("OREO") for the first quarter of 2019 was 0.57 percent, compared to 0.36 percent for the fourth quarter of 2018 and 0.65 percent for the first quarter of 2018. Net charge-offs for the first quarter of 2019 were $4.6 million compared to $32.6 million for the fourth quarter of 2018 and $5.2 million for the first quarter of 2018. For the first quarter of 2019, net charge-offs were 0.09 percent of average total LHI, compared to 0.60 percent for the fourth quarter of 2018 and 0.11 percent for the same period in 2018.

Non-interest income increased $14.7 million, or 96 percent, during the first quarter of 2019 compared to the fourth quarter of 2018, and increased $10.1 million, or 50 percent, compared to the first quarter of 2018. The linked quarter increase is primarily related to increases in the net gain on sale of loans held for sale and other non-interest income, primarily due to an $8.5 million legal claim settled during the first quarter of 2019. The year-over-year increase primarily related to increases in the net gain on sale of loans and other non-interest income, primarily due to an $8.5 million legal claim settled during the first quarter of 2019, offset by a decrease in servicing income.

Non-interest expense for the first quarter of 2019 increased $10.5 million, or 8 percent, compared to the fourth quarter of 2018, and increased $13.4 million, or 11 percent, compared to the first quarter of 2018. The linked quarter increase in non-interest expense was primarily related to increases in salaries and employee benefits, marketing and servicing related expenses, offset by a decrease in legal and professional expenses. The year-over-year increase was primarily due to increases in salaries and employee benefits, marketing, legal and professional and communications and technology expenses, offset by a $2.2 million decrease in allowance and other carrying costs for OREO related to the decline in OREO properties held.

Stockholders’ equity increased by 14 percent from $2.3 billion at March 31, 2018 to $2.6 billion at March 31, 2019, primarily due to the retention of net income. Texas Capital Bank is well capitalized under regulatory guidelines. At March 31, 2019, our ratio of tangible common equity to total tangible assets was 8.5% percent.

ABOUT TEXAS CAPITAL BANCSHARES, INC.Texas Capital Bancshares, Inc. (NASDAQ®: TCBI), a member of the Russell 2000® Index and the S&P MidCap 400®, is the parent company of Texas Capital Bank, a commercial bank that delivers highly personalized financial services to businesses and entrepreneurs. Headquartered in Dallas, the bank has full-service locations in Austin, Dallas, Fort Worth, Houston and San Antonio.

This news release may be deemed to include forward-looking statements which are based on management’s current estimates or expectations of future events or future results. These statements are not historical in nature and can generally be identified by such words as “believe,” “expect,” “estimate,” “anticipate,” “plan,” “may,” “will,” “intend” and similar expressions. A number of factors, many of which are beyond our control, could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. These risks and uncertainties include, but are not limited to, the credit quality of our loan portfolio, general economic conditions in the United States and in our markets, including the continued impact on our customers from volatility in oil and gas prices, expectations regarding rates of default and loan losses, volatility in the mortgage industry, our business strategies and our expectations about future financial performance, future growth and earnings, the appropriateness of our allowance for loan losses and provision for credit losses, the impact of changing regulatory requirements and legislative changes on our business, increased competition, interest rate risk, new lines of business, new product or service offerings and new technologies. These and other factors that could cause results to differ materially from those described in the forward-looking statements, as well as a discussion of the risks and uncertainties that may affect our business, can be found in our Annual Report on Form 10-K and in other filings we make with the Securities and Exchange Commission. The information contained in this release speaks only as of its date. We are under no obligation, and expressly disclaim such obligation, to update, alter or revise our forward-looking statements, whether as a result of new information, future events, or otherwise.

TEXAS CAPITAL BANCSHARES, INC.
SELECTED FINANCIAL HIGHLIGHTS (UNAUDITED)
(Dollars in thousands except per share data)
1st Quarter4th Quarter3rd Quarter2nd Quarter1st Quarter
20192018201820182018
CONSOLIDATED STATEMENTS OF INCOME
Interest income$325,561 $321,718 $301,754 $286,852 $253,869
Interest expense89,947 81,045 69,579 55,140 43,569
Net interest income235,614 240,673 232,175 231,712 210,300
Provision for credit losses20,000 35,000 13,000 27,000 12,000
Net interest income after provision for credit losses215,614 205,673 219,175 204,712 198,300
Non-interest income30,014 15,280 25,518 17,279 19,947
Non-interest expense140,378 129,862 136,143 132,131 126,960
Income before income taxes105,250 91,091 108,550 89,860 91,287
Income tax expense22,411 19,200 22,998 18,424 19,342
Net income82,839 71,891 85,552 71,436 71,945
Preferred stock dividends2,438 2,437 2,438 2,437 2,438
Net income available to common stockholders$80,401 $69,454 $83,114 $68,999 $69,507
Diluted EPS$1.60 $1.38 $1.65 $1.38 $1.38
Diluted shares50,345,399 50,333,412 50,381,349 50,096,015 50,353,497
CONSOLIDATED BALANCE SHEET DATA
Total assets$28,383,111 $28,257,767 $27,127,107 $27,781,910 $24,449,147
LHI17,061,590 16,690,550 16,569,538 16,536,721 15,741,772
LHI, mortgage finance6,299,710 5,877,524 5,477,787 5,923,058 4,689,938
LHS1,901,637 1,969,474 1,651,930 1,276,768 1,088,565
Liquidity assets(1)2,154,155 2,865,874 2,615,570 3,288,107 2,296,673
Investment securities230,749 120,216 117,389 24,408 24,929
Demand deposits6,743,607 7,317,161 7,031,460 7,648,125 7,413,340
Total deposits20,650,127 20,606,113 20,385,637 20,334,871 18,764,533
Other borrowings4,497,892 4,541,174 3,686,818 4,520,849 2,835,540
Subordinated notes281,858 281,767 281,677 281,586 281,496
Long-term debt113,406 113,406 113,406 113,406 113,406
Stockholders’ equity2,581,942 2,500,394 2,426,442 2,343,530 2,273,429
End of period shares outstanding50,263,611 50,200,710 50,177,260 50,151,064 49,669,774
Book value$48.38 $46.82 $45.37 $43.74 $42.75
Tangible book value(2)$48.02 $46.45 $45.00 $43.36 $42.37
SELECTED FINANCIAL RATIOS
Net interest margin3.73%3.78%3.70%3.93%3.71%
Return on average assets1.26%1.09%1.31%1.16%1.22%
Return on average common equity13.58%11.82%14.68%12.72%13.39%
Non-interest income to average earning assets0.47%0.24%0.40%0.29%0.35%
Efficiency ratio(3)52.8%50.7%52.8%53.1%55.1%
Non-interest expense to average earning assets2.21%2.03%2.15%2.23%2.23%
Tangible common equity to total tangible assets(4)8.5%8.3%8.3%7.8%8.6%
Common Equity Tier 18.6%8.6%8.6%8.3%8.8%
Tier 1 capital9.6%9.5%9.6%9.3%9.9%
Total capital11.4%11.3%11.5%11.1%11.9%
Leverage10.0%9.9%9.7%9.9%9.9%

(1) Liquidity assets include Federal funds sold and interest-bearing deposits in other banks.(2) Stockholders’ equity excluding preferred stock, less goodwill and intangibles, divided by shares outstanding at period end.(3) Non-interest expense divided by the sum of net interest income and non-interest income.(4) Stockholders’ equity excluding preferred stock and accumulated other comprehensive income less goodwill and intangibles divided by total assets less accumulated other comprehensive income and goodwill and intangibles.

TEXAS CAPITAL BANCSHARES, INC.
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(Dollars in thousands)
March 31, 2019March 31, 2018%Change
Assets
Cash and due from banks$177,137 $154,497 15%
Interest-bearing deposits2,129,155 2,271,673 (6)%
Federal funds sold and securities purchased under resale agreements25,000 25,000 —%
Securities, available-for-sale230,749 24,929 826%
LHS, at fair value1,901,637 1,088,565 75%
LHI, mortgage finance6,299,710 4,689,938 34%
LHI (net of unearned income)17,061,590 15,741,772 8%
Less: Allowance for loan losses208,573 190,898 9%
LHI, net23,152,727 20,240,812 14%
Mortgage servicing rights, net44,088 76,561 (42)%
Premises and equipment, net24,200 27,564 (12)%
Accrued interest receivable and other assets679,966 520,624 31%
Goodwill and intangibles, net18,452 18,922 (2)%
Total assets$28,383,111 $24,449,147 16%
Liabilities and Stockholders’ Equity
Liabilities:
Deposits:
Non-interest bearing$6,743,607 $7,413,340 (9)%
Interest bearing13,906,520 11,351,193 23%
Total deposits20,650,127 18,764,533 10%
Accrued interest payable24,488 5,174 373%
Other liabilities233,398 175,569 33%
Federal funds purchased and repurchase agreements897,892 535,540 68%
Other borrowings3,600,000 2,300,000 57%
Subordinated notes, net281,858 281,496 —%
Trust preferred subordinated debentures113,406 113,406 —%
Total liabilities25,801,169 22,175,718 16%
Stockholders’ equity:
Preferred stock, $.01 par value, $1,000 liquidation value:
Authorized shares - 10,000,000
Issued shares - 6,000,000 shares issued at March 31, 2019 and 2018150,000 150,000 —%
Common stock, $.01 par value:
Authorized shares - 100,000,000
Issued shares - 50,264,028 and 49,670,191 at March 31, 2019 and 2018, respectively503 497 1%
Additional paid-in capital969,079 962,553 1%
Retained earnings1,461,893 1,159,925 26%
Treasury stock (shares at cost: 417 at March 31, 2019 and 2018)(8)(8)—%
Accumulated other comprehensive income, net of taxes475 462 3%
Total stockholders’ equity2,581,942 2,273,429 14%
Total liabilities and stockholders’ equity$28,383,111 $24,449,147 16%

TEXAS CAPITAL BANCSHARES, INC.
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
(Dollars in thousands except per share data)
Three Months Ended March 31,
20192018
Interest income
Interest and fees on loans$312,703 $243,864
Investment securities1,460 206
Federal funds sold and securities purchased under resale agreements379 1,045
Interest-bearing deposits in other banks11,019 8,754
Total interest income325,561 253,869
Interest expense
Deposits69,054 31,702
Federal funds purchased3,516 969
Other borrowings11,854 5,680
Subordinated notes4,191 4,191
Trust preferred subordinated debentures1,332 1,027
Total interest expense89,947 43,569
Net interest income235,614 210,300
Provision for credit losses20,000 12,000
Net interest income after provision for credit losses215,614 198,300
Non-interest income
Service charges on deposit accounts2,979 3,137
Wealth management and trust fee income2,009 1,924
Brokered loan fees5,066 5,168
Servicing income2,734 5,492
Swap fees1,031 1,562
Net gain/(loss) on sale of LHS(505)(2,173)
Other16,700 4,837
Total non-interest income30,014 19,947
Non-interest expense
Salaries and employee benefits77,823 72,537
Net occupancy expense7,879 7,234
Marketing11,708 8,677
Legal and professional10,030 7,530
Communications and technology9,198 6,633
FDIC insurance assessment5,122 6,103
Servicing related expenses5,382 3,805
Allowance and other carrying costs for OREO— 2,155
Other13,236 12,286
Total non-interest expense140,378 126,960
Income before income taxes105,250 91,287
Income tax expense22,411 19,342
Net income82,839 71,945
Preferred stock dividends2,438 2,438
Net income available to common stockholders$80,401 $69,507
Basic earnings per common share$1.60 $1.40
Diluted earnings per common share$1.60 $1.38

TEXAS CAPITAL BANCSHARES, INC.
SUMMARY OF LOAN LOSS EXPERIENCE
(Dollars in thousands)
1st Quarter4th Quarter3rd Quarter2nd Quarter1st Quarter
20192018201820182018
Allowance for loan losses:
Beginning balance$191,522 $190,306 $179,096 $190,898 $184,655
Loans charged-off:
Commercial4,865 34,419 1,301 38,305 5,667
Real estate— — — — —
Construction— — — — —
Consumer— — 767 — —
Leases— — 319 — —
Total charge-offs4,865 34,419 2,387 38,305 5,667
Recoveries:
Commercial266 1,399 389 320 360
Real estate— 26 11 8 24
Construction— — — — —
Consumer10 360 10 9 59
Leases1 1 12 1 19
Total recoveries277 1,786 422 338 462
Net charge-offs4,588 32,633 1,965 37,967 5,205
Provision for loan losses21,639 33,849 13,175 26,165 11,448
Ending balance$208,573 $191,522 $190,306 $179,096 $190,898
Allowance for off-balance sheet credit losses:
Beginning balance$11,434 $10,283 $10,458 $9,623 $9,071
Provision for off-balance sheet credit losses(1,639)1,151 (175)835 552
Ending balance$9,795 $11,434 $10,283 $10,458 $9,623
Total allowance for credit losses$218,368 $202,956 $200,589 $189,554 $200,521
Total provision for credit losses$20,000 $35,000 $13,000 $27,000 $12,000
Allowance for loan losses to LHI0.89%0.85%0.86%0.80%0.93%
Allowance for loan losses to average LHI0.96%0.88%0.87%0.86%0.98%
Net charge-offs to average LHI(1)0.09%0.60%0.04%0.73%0.11%
Net charge-offs to average LHI for last twelve months(1)0.36%0.37%0.22%0.28%0.15%
Total provision for credit losses to average LHI(1)0.37%0.64%0.24%0.52%0.25%
Total allowance for credit losses to LHI0.93%0.90%0.91%0.84%0.98%

(1) Interim period ratios are annualized.

TEXAS CAPITAL BANCSHARES, INC.
SUMMARY OF NON-PERFORMING ASSETS AND PAST DUE LOANS
(Dollars in thousands)
1st Quarter4th Quarter3rd Quarter2nd Quarter1st Quarter
20192018201820182018
Non-performing assets (NPAs):
Non-accrual loans$133,690 $80,375 $107,532 $83,295 $123,542
Other real estate owned (OREO)— 79 79 9,526 9,558
Total LHI NPAs$133,690 $80,454 $107,611 $92,821 $133,100
Non-accrual loans to LHI0.57%0.36%0.49%0.37%0.60%
Total LHI NPAs to LHI plus OREO0.57%0.36%0.49%0.41%0.65%
Total LHI NPAs to earning assets0.49%0.29%0.41%0.35%0.56%
Allowance for loan losses to non-accrual loans 1.6x 2.4x 1.8x 2.2x 1.5x
Loans past due 90 days and still accruing(1)$12,245 $9,353 $11,295 $7,357 $13,563
Loans past due 90 days to LHI0.05%0.04%0.05%0.03%0.07%
LHS past due 90 days and still accruing(2)$13,693 $16,829 $25,238 $27,858 $35,226

(1) At March 31, 2019, loans past due 90 days and still accruing includes premium finance loans of $12.0 million. These loans are primarily secured by obligations of insurance carriers to refund premiums on canceled insurance policies. The refund of premiums from the insurance carriers can take 180 days or longer from the cancellation date.(2) Includes loans guaranteed by U.S. government agencies that were repurchased out of Ginnie Mae securities. Loans are recorded as LHS and carried at fair value on the balance sheet. Interest on these past due loans accrues at the debenture rate guaranteed by the U.S. government. Also includes loans that, pursuant to Ginnie Mae servicing guidelines, we have the unilateral right, but not obligation, to repurchase and thus must record as LHS on our balance sheet regardless of whether the repurchase option has been exercised.

TEXAS CAPITAL BANCSHARES, INC.
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
(Dollars in thousands)
1st Quarter4th Quarter3rd Quarter2nd Quarter1st Quarter
20192018201820182018
Interest income
Interest and fees on loans$312,703 $310,470 $291,189 $279,447 $243,864
Investment securities1,460 1,274 1,161 193 206
Federal funds sold and securities purchased under resale agreements379 984 1,018 745 1,045
Interest-bearing deposits in other banks11,019 8,990 8,386 6,467 8,754
Total interest income325,561 321,718 301,754 286,852 253,869
Interest expense
Deposits69,054 61,773 52,034 39,607 31,702
Federal funds purchased3,516 2,097 1,800 1,665 969
Other borrowings11,854 11,726 10,317 8,484 5,680
Subordinated notes4,191 4,191 4,191 4,191 4,191
Trust preferred subordinated debentures1,332 1,258 1,237 1,193 1,027
Total interest expense89,947 81,045 69,579 55,140 43,569
Net interest income235,614 240,673 232,175 231,712 210,300
Provision for credit losses20,000 35,000 13,000 27,000 12,000
Net interest income after provision for credit losses215,614 205,673 219,175 204,712 198,300
Non-interest income
Service charges on deposit accounts2,979 3,168 3,477 3,005 3,137
Wealth management and trust fee income2,009 2,152 2,065 2,007 1,924
Brokered loan fees5,066 5,408 6,141 5,815 5,168
Servicing income2,734 2,861 4,987 4,967 5,492
Swap fees1,031 1,356 1,355 1,352 1,562
Net gain/(loss) on sale of LHS(505)(8,087)(444)(5,230)(2,173)
Other16,700 8,422 7,937 5,363 4,837
Total non-interest income30,014 15,280 25,518 17,279 19,947
Non-interest expense
Salaries and employee benefits77,823 69,500 77,327 72,404 72,537
Net occupancy expense7,879 7,390 8,362 7,356 7,234
Marketing11,708 10,208 10,214 10,236 8,677
Legal and professional10,030 13,042 10,764 11,654 7,530
Communications and technology9,198 8,845 7,435 7,143 6,633
FDIC insurance assessment5,122 5,423 6,524 6,257 6,103
Servicing related expenses5,382 2,555 4,207 4,367 3,805
Allowance and other carrying costs for OREO— 7 (1,864)176 2,155
Other13,236 12,892 13,174 12,538 12,286
Total non-interest expense140,378 129,862 136,143 132,131 126,960
Income before income taxes105,250 91,091 108,550 89,860 91,287
Income tax expense22,411 19,200 22,998 18,424 19,342
Net income82,839 71,891 85,552 71,436 71,945
Preferred stock dividends2,438 2,437 2,438 2,437 2,438
Net income available to common shareholders$80,401 $69,454 $83,114 $68,999 $69,507

TEXAS CAPITAL BANCSHARES, INC.
QUARTERLY FINANCIAL SUMMARY - UNAUDITED
Consolidated Daily Average Balances, Average Yields and Rates
(Dollars in thousands)
1st Quarter 2019 4th Quarter 2018 3rd Quarter 2018 2nd Quarter 2018 1st Quarter 2018
AverageBalanceRevenue/ExpenseYield/Rate AverageBalanceRevenue/ExpenseYield/Rate Average BalanceRevenue/ExpenseYield/ Rate Average BalanceRevenue/ExpenseYield/ Rate Average BalanceRevenue/ExpenseYield/ Rate
Assets
Investment securities - Taxable$30,625 $274 3.62% $23,977 $259 4.29% $24,221 $191 3.14% $24,514 $193 3.15% $23,854 $206 3.50%
Investment securities - Non-taxable(2)114,341 1,501 5.33% 93,394 1,285 5.46% 91,298 1,228 5.33% — — —% — — —%
Federal funds sold and securities purchased under resale agreements63,652 379 2.41% 173,654 984 2.25% 203,972 1,018 1.98% 166,613 745 1.79% 261,641 1,045 1.62%
Interest-bearing deposits in other banks1,823,106 11,019 2.45% 1,585,763 8,990 2.25% 1,697,787 8,386 1.96% 1,498,474 6,467 1.73% 2,302,938 8,754 1.54%
LHS, at fair value2,122,302 25,303 4.84% 2,049,395 24,407 4.72% 1,484,459 17,272 4.62% 1,516,047 17,026 4.50% 1,187,594 12,535 4.28%
LHI, mortgage finance loans4,931,879 46,368 3.81% 5,046,540 47,305 3.72% 5,443,829 49,715 3.62% 4,898,411 47,056 3.85% 4,097,995 37,362 3.70%
LHI(1)(2)16,866,456 242,155 5.82% 16,643,559 239,995 5.72% 16,331,622 225,604 5.48% 15,883,317 216,755 5.47% 15,425,323 195,333 5.14%
Less allowance for loan losses192,122 — — 182,814 — — 179,227 — — 189,238 — — 184,238 — —
LHI, net of allowance21,606,213 288,523 5.42% 21,507,285 287,300 5.30% 21,596,224 275,319 5.06% 20,592,490 263,811 5.14% 19,339,080 232,695 4.88%
Total earning assets25,760,239 326,999 5.15% 25,433,468 323,225 5.04% 25,097,961 303,414 4.80% 23,798,138 288,242 4.86% 23,115,107 255,235 4.48%
Cash and other assets894,797 828,156 877,954 808,099 797,506
Total assets$26,655,036 $26,261,624 $25,975,915 $24,606,237 $23,912,613
Liabilities and Stockholders’ Equity
Transaction deposits$3,263,976 $16,001 1.99% $3,233,960 $15,150 1.86% $3,253,310 $13,642 1.66% $2,889,834 $10,295 1.43% $2,792,954 $8,651 1.26%
Savings deposits8,751,200 41,673 1.93% 8,354,332 36,913 1.75% 7,820,742 29,930 1.52% 7,784,937 25,454 1.31% 7,982,256 21,958 1.12%
Time deposits2,010,476 11,380 2.30% 1,886,016 9,710 2.04% 1,778,831 8,462 1.89% 979,735 3,858 1.58% 506,375 1,093 0.88%
Total interest bearing deposits14,025,652 69,054 2.00% 13,474,308 61,773 1.82% 12,852,883 52,034 1.61% 11,654,506 39,607 1.36% 11,281,585 31,702 1.14%
Other borrowings2,412,254 15,370 2.58% 2,290,520 13,823 2.39% 2,275,640 12,117 2.11% 2,113,391 10,149 1.93% 1,721,914 6,649 1.57%
Subordinated notes281,799 4,191 6.03% 281,708 4,191 5.90% 281,619 4,191 5.90% 281,527 4,191 5.97% 281,437 4,191 6.04%
Trust preferred subordinated debentures113,406 1,332 4.76% 113,406 1,258 4.40% 113,406 1,237 4.33% 113,406 1,193 4.22% 113,406 1,027 3.67%
Total interest bearing liabilities16,833,111 89,947 2.17% 16,159,942 81,045 1.99% 15,523,548 69,579 1.78% 14,162,830 55,140 1.56% 13,398,342 43,569 1.32%
Demand deposits7,047,120 7,462,392 7,940,503 8,017,578 8,147,721
Other liabilities223,142 157,278 116,302 100,074 110,698
Stockholders’ equity2,551,663 2,482,012 2,395,562 2,325,755 2,255,852
Total liabilities and stockholders’ equity$26,655,036 $26,261,624 $25,975,915 $24,606,237 $23,912,613
Net interest income(2) $237,052 $242,180 $233,835 $233,102 $211,666
Net interest margin 3.73% 3.78% 3.70% 3.93% 3.71%

(1) The loan averages include loans on which the accrual of interest has been discontinued and are stated net of unearned income.(2) Taxable equivalent rates used where applicable.

INVESTOR CONTACTHeather Worley, 214.932.6646[email protected]

Texas Capital Bancshares, Inc.

Source: Texas Capital Bancshares, Inc.

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