Company Announcements

Texas Capital Bancshares, Inc. Announces Third Quarter 2024 Results

Source: GlobeNewswire
Texas Capital Bancshares, Inc. Announces Third Quarter 2024 Results

Record level of income in fee areas of focus(1)

Quarterly strategic actions include acquisition of $332 million commercial loan portfolio and balance sheet
repositioning of the proceeds from $1.2 billion sale of lower-yielding available-for-sale securities into higher yielding securities

Book Value and Tangible Book Value(2) per share both increased 14% year over year, reaching record levels

Capital ratios continue to be strong, including 11.2% CET1 and 15.2% Total Capital

DALLAS, Oct. 17, 2024 (GLOBE NEWSWIRE) -- Texas Capital Bancshares, Inc. (NASDAQ: TCBI), the parent company of Texas Capital Bank, announced operating results for the third quarter of 2024.

Net loss available to common stockholders was $65.6 million, or $1.41 net loss per diluted share, for the third quarter of 2024, compared to net income available to common stockholders of $37.4 million, or $0.80 net income per diluted share, and $57.4 million, or $1.18 per diluted share, for the for the second quarter of 2024 and third quarter of 2023, respectively.

The third quarter of 2024 included a $179.6 million loss on sale of available-for-sale debt securities ($2.92 net loss per diluted share) and restructuring expense of $5.9 million ($0.10 net loss per diluted share), partially offset by a $651,000 release of Federal Deposit Insurance Corporation (“FDIC”) special assessment accrual ($0.01 net income per diluted share).

“We achieved significant financial milestones this quarter as our multi-year transformation is increasingly delivering financial outcomes consistent with realized success delivering our proven and differentiated strategy,” said Rob C. Holmes, President and CEO. “Our current business momentum coupled with our sustained leading capital and liquidity levels positions us well to effectively drive execution through 2025.”

FINANCIAL RESULTS     
(dollars and shares in thousands)     
 3rd Quarter 2nd Quarter 3rd Quarter
  2024   2024   2023 
OPERATING RESULTS     
Net income/(loss)$(61,319) $41,662  $61,679 
Net income/(loss) available to common stockholders$(65,632) $37,350  $57,366 
Diluted earnings/(loss) per common share$(1.41) $0.80  $1.18 
Diluted common shares 46,609   46,872   48,529 
Return on average assets(0.78)%  0.56%  0.81%
Return on average common equity(8.87)%  5.26%  8.08%
      
BALANCE SHEET     
Loans held for investment$16,764,512  $16,700,569  $16,183,882 
Loans held for investment, mortgage finance 5,529,659   5,078,161   4,429,489 
Total loans held for investment 22,294,171   21,778,730   20,613,371 
Loans held for sale 9,022   36,785   155,073 
Total assets 31,629,299   29,854,994   29,628,249 
Non-interest bearing deposits 9,070,804   7,987,715   9,352,883 
Total deposits 25,865,255   23,818,327   23,878,978 
Stockholders’ equity 3,354,044   3,175,601   3,077,700 
      


(1)Fee areas of focus include service charges on deposit accounts, wealth managment and trust fee income, investment banking and advisory fees and trading income.
(2)Stockholders’ equity excluding preferred stock, less goodwill and intangibles, divided by shares outstanding at period end.
  

THIRD QUARTER 2024 COMPARED TO SECOND QUARTER 2024

For the third quarter of 2024, net loss available to common stockholders was $65.6 million, or $1.41 net loss per diluted share, compared to net income available to common stockholders of $37.4 million, or $0.80 net income per diluted share, for the second quarter of 2024. The net loss for the third quarter of 2024 resulted primarily from the $179.6 million loss on the sale of available-for-sale debt securities ($2.92 net loss per diluted share).

Provision for credit losses for the third quarter of 2024 was $10.0 million, compared to $20.0 million for the second quarter of 2024. The $10.0 million provision for credit losses recorded in the third quarter of 2024 resulted primarily from growth in total loans held for investment (“LHI”) and $6.1 million in net charge-offs.

Net interest income was $240.1 million for the third quarter of 2024, compared to $216.6 million for the second quarter of 2024, as increases in average earning assets and yields on average earning assets were partially offset by an increase in average interest bearing deposits. Net interest margin for the third quarter of 2024 was 3.16%, an increase of 15 basis points from the second quarter of 2024. LHI, excluding mortgage finance, yields increased 1 basis point from the second quarter of 2024 and LHI, mortgage finance, yields increased 26 basis points from the second quarter of 2024. Total cost of deposits was 2.94% for the third quarter of 2024, a 5 basis point decrease from the second quarter of 2024.

Non-interest income for the third quarter of 2024 decreased $165.2 million compared to the second quarter of 2024, primarily due to the $179.6 million loss on sale of available-for-sale debt securities recognized during the third quarter of 2024, partially offset by increases in investment banking and advisory fees and other non-interest income.

Non-interest expense for the third quarter of 2024 increased $6.9 million, or 4%, compared to the second quarter of 2024, primarily due to increases in salaries and benefits, occupancy expense and communications and technology expense, partially offset by decreases in FDIC assessment expense and other non-interest expense. The third quarter of 2024 included restructuring expenses of $2.4 million recorded in salaries and benefits, $476,000 recorded in occupancy expense and $3.1 million recorded in communications and technology expense. The third quarter of 2024 also included a $651,000 release of FDIC special assessment accrual.

THIRD QUARTER 2024 COMPARED TO THIRD QUARTER 2023

Net loss available to common stockholders was $65.6 million, or $1.41 net loss per diluted share, for the third quarter of 2024, compared to net income available to common stockholders of $57.4 million, or $1.18 net income per diluted share, for the third quarter of 2023.

The third quarter of 2024 included a $10.0 million provision for credit losses, reflecting growth in total LHI and $6.1 million in net charge-offs, compared to an $18.0 million provision for the third quarter of 2023.

Net interest income increased to $240.1 million for the third quarter of 2024, compared to $232.1 million for the third quarter of 2023, primarily due to increases in average total LHI and yields on average earning assets, partially offset by an increase in average interest bearing liabilities. Net interest margin increased 3 basis points to 3.16% for the third quarter of 2024 compared to the third quarter of 2023. LHI, excluding mortgage finance, yields increased 12 basis points compared to the third quarter of 2023 and LHI, mortgage finance yields decreased 9 basis points from the third quarter of 2023. Total cost of deposits increased 32 basis points compared to the third quarter of 2023.

Non-interest income for the third quarter of 2024 decreased $161.6 million compared to the third quarter of 2023. The decrease was primarily due to the $179.6 million loss on sale of available-for-sale debt securities recognized during the third quarter of 2024, partially offset by increases in investment banking and advisory fees and other non-interest income.

Non-interest expense for the third quarter of 2024 increased $15.4 million, or 9%, compared to the third quarter of 2023, primarily due to increases in salaries and benefits, occupancy expense and communications and technology expense, partially offset by decreases in legal and professional expense.

CREDIT QUALITY

Net charge-offs of $6.1 million were recorded during the third quarter of 2024, compared to net charge-offs of $12.0 million and $8.9 million during the second quarter of 2024 and the third quarter of 2023, respectively. Criticized loans totaled $897.7 million at September 30, 2024, compared to $859.7 million at June 30, 2024 and $677.4 million at September 30, 2023. Non-accrual LHI totaled $89.0 million at September 30, 2024, compared to $85.0 million at June 30, 2024 and $63.1 million at September 30, 2023. The ratio of non-accrual LHI to total LHI for the third quarter of 2024 was 0.40%, compared to 0.39% for the second quarter of 2024 and 0.31% for the third quarter of 2023. The ratio of total allowance for credit losses to total LHI was 1.43% at September 30, 2024, compared to 1.44% and 1.41% at June 30, 2024 and September 30, 2023, respectively.

REGULATORY RATIOS AND CAPITAL

All regulatory ratios continue to be in excess of “well capitalized” requirements as of September 30, 2024. CET1, tier 1 capital, total capital and leverage ratios were 11.2%, 12.6%, 15.2% and 11.4%, respectively, at September 30, 2024, compared to 11.6%, 13.1%, 15.7% and 12.2%, respectively, at June 30, 2024 and 12.7%, 14.3%, 17.1% and 12.1%, respectively, at September 30, 2023. At September 30, 2024, our ratio of tangible common equity to total tangible assets was 9.7%, compared to 9.6% at June 30, 2024 and 9.4% at September 30, 2023.

About Texas Capital Bancshares, Inc.

Texas Capital Bancshares, Inc. (NASDAQ: TCBI), a member of the Russell 2000® Index and the S&P MidCap 400®, the parent company of Texas Capital Bank d/b/a Texas Capital, is a full-service financial services firm that delivers customized solutions to businesses, entrepreneurs and individual customers. Founded in 1998, the institution is headquartered in Dallas with offices in Austin, Houston, San Antonio, and Fort Worth, and has built a network of clients across the country. With the ability to service clients through their entire lifecycles, Texas Capital has established commercial banking, consumer banking, investment banking and wealth management capabilities.

Forward Looking Statements

This communication contains “forward-looking statements” within the meaning of and pursuant to the Private Securities Litigation Reform Act of 1995 regarding, among other things, TCBI’s financial condition, results of operations, business plans and future performance. These statements are not historical in nature and may often be identified by the use of words such as “believes,” “projects,” “expects,” “may,” “estimates,” “should,” “plans,” “targets,” “intends” “could,” “would,” “anticipates,” “potential,” “confident,” “optimistic” or the negative thereof, or other variations thereon, or comparable terminology, or by discussions of strategy, objectives, estimates, trends, guidance, expectations and future plans.

Because forward-looking statements relate to future results and occurrences, they are subject to inherent and various uncertainties, risks, and changes in circumstances that are difficult to predict, may change over time, are based on management’s expectations and assumptions at the time the statements are made and are not guarantees of future results. Numerous risks and other factors, many of which are beyond management’s control, could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. While there can be no assurance that any list of risks is complete, important risks and other factors that could cause actual results to differ materially from those contemplated by forward-looking statements include, but are not limited to: economic or business conditions in Texas, the United States or globally that impact TCBI or its customers; negative credit quality developments arising from the foregoing or other factors; TCBI’s ability to effectively manage its liquidity and maintain adequate regulatory capital to support its businesses; TCBI’s ability to pursue and execute upon growth plans, whether as a function of capital, liquidity or other limitations; TCBI’s ability to successfully execute its business strategy, including its strategic plan and developing and executing new lines of business and new products and services; the extensive regulations to which TCBI is subject and its ability to comply with applicable governmental regulations, including legislative and regulatory changes; TCBI’s ability to effectively manage information technology systems, including third party vendors, cyber or data privacy incidents or other failures, disruptions or security breaches; elevated or further changes in interest rates, including the impact of interest rates on TCBI’s securities portfolio and funding costs, as well as related balance sheet implications stemming from the fair value of our assets and liabilities; the effectiveness of TCBI’s risk management processes strategies and monitoring; fluctuations in commercial and residential real estate values, especially as they relate to the value of collateral supporting TCBI’s loans; the failure to identify, attract and retain key personnel and other employees; increased or expanded competition from banks and other financial service providers in TCBI’s markets; adverse developments in the banking industry and the potential impact of such developments on customer confidence, liquidity and regulatory responses to these developments, including in the context of regulatory examinations and related findings and actions; negative press and social media attention with respect to the banking industry or TCBI, in particular; claims, litigation or regulatory investigations and actions that TCBI may become subject to; severe weather, natural disasters, climate change, acts of war, terrorism, global conflict (including those already reported by the media, as well as others that may arise), or other external events, as well as related legislative and regulatory initiatives; and the risks and factors more fully described in TCBI’s most recent Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and other documents and filings with the SEC. The information contained in this communication speaks only as of its date. Except to the extent required by applicable law or regulation, we disclaim any obligation to update such factors or to publicly announce the results of any revisions to any of the forward-looking statements included herein to reflect future events or developments.

TEXAS CAPITAL BANCSHARES, INC.
SELECTED FINANCIAL HIGHLIGHTS (UNAUDITED)
(dollars in thousands except per share data)
 3rd Quarter2nd Quarter1st Quarter4th Quarter3rd Quarter
  2024  2024  2024  2023  2023 
CONSOLIDATED STATEMENTS OF INCOME     
Interest income$452,533 $422,068 $417,378 $417,072 $425,769 
Interest expense 212,431  205,486  202,369  202,355  193,698 
Net interest income 240,102  216,582  215,009  214,717  232,071 
Provision for credit losses 10,000  20,000  19,000  19,000  18,000 
Net interest income after provision for credit losses 230,102  196,582  196,009  195,717  214,071 
Non-interest income (114,771) 50,424  41,319  31,133  46,872 
Non-interest expense 195,324  188,409  202,393  201,385  179,891 
Income/(loss) before income taxes (79,993) 58,597  34,935  25,465  81,052 
Income tax expense/(benefit) (18,674) 16,935  8,793  5,315  19,373 
Net income/(loss) (61,319) 41,662  26,142  20,150  61,679 
Preferred stock dividends 4,313  4,312  4,313  4,312  4,313 
Net income/(loss) available to common stockholders$(65,632)$37,350 $21,829 $15,838 $57,366 
Diluted earnings/(loss) per common share$(1.41)$0.80 $0.46 $0.33 $1.18 
Diluted common shares 46,608,742  46,872,498  47,711,192  48,097,517  48,528,698 
      
CONSOLIDATED BALANCE SHEET DATA     
Total assets$31,629,299 $29,854,994 $29,180,585 $28,356,266 $29,628,249 
Loans held for investment 16,764,512  16,700,569  16,677,691  16,362,230  16,183,882 
Loans held for investment, mortgage finance 5,529,659  5,078,161  4,153,313  3,978,328  4,429,489 
Loans held for sale 9,022  36,785  37,750  44,105  155,073 
Interest bearing cash and cash equivalents 3,894,537  2,691,352  3,148,157  3,042,357  3,975,860 
Investment securities 4,405,520  4,388,976  4,414,280  4,143,194  4,069,717 
Non-interest bearing deposits 9,070,804  7,987,715  8,478,215  7,328,276  9,352,883 
Total deposits 25,865,255  23,818,327  23,954,037  22,371,839  23,878,978 
Short-term borrowings 1,035,000  1,675,000  750,000  1,500,000  1,400,000 
Long-term debt 660,172  659,997  859,823  859,147  858,471 
Stockholders’ equity 3,354,044  3,175,601  3,170,662  3,199,142  3,077,700 
      
End of period shares outstanding 46,207,757  46,188,078  46,986,275  47,237,912  48,015,003 
Book value per share$66.09 $62.26 $61.10 $61.37 $57.85 
Tangible book value per share(1)$66.06 $62.23 $61.06 $61.34 $57.82 
      
SELECTED FINANCIAL RATIOS     
Net interest margin 3.16% 3.01% 3.03% 2.93% 3.13%
Return on average assets(0.78)% 0.56% 0.36% 0.27% 0.81%
Return on average common equity(8.87)% 5.26% 3.03% 2.25% 8.08%
Non-interest income to average earning assets(1.52)% 0.71% 0.59% 0.43% 0.64%
Efficiency ratio(2) 155.8% 70.6% 79.0% 81.9% 64.5%
Non-interest expense to average earning assets 2.59% 2.65% 2.89% 2.79% 2.46%
Common equity to total assets 9.7% 9.6% 9.8% 10.2% 9.4%
Tangible common equity to total tangible assets(3) 9.7% 9.6% 9.8% 10.2% 9.4%
Common Equity Tier 1 11.2% 11.6% 12.4% 12.6% 12.7%
Tier 1 capital 12.6% 13.1% 13.9% 14.2% 14.3%
Total capital 15.2% 15.7% 16.6% 17.1% 17.1%
Leverage 11.4% 12.2% 12.4% 12.2% 12.1%


(1)Stockholders’ equity excluding preferred stock, less goodwill and intangibles, divided by shares outstanding at period end.
(2)Non-interest expense divided by the sum of net interest income and non-interest income.
(3)Stockholders’ equity excluding preferred stock, less goodwill and intangibles, divided by total assets, less goodwill and intangibles.
  

        

TEXAS CAPITAL BANCSHARES, INC.
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(dollars in thousands)
 September 30, 2024September 30, 2023% Change
Assets   
Cash and due from banks$297,048 $216,916 37%
Interest bearing cash and cash equivalents 3,894,537  3,975,860 (2)%
Available-for-sale debt securities 3,518,662  3,147,865 12%
Held-to-maturity debt securities 812,432  881,352 (8)%
Equity securities 74,426  40,500 84%
Investment securities 4,405,520  4,069,717 8%
Loans held for sale 9,022  155,073 (94)%
Loans held for investment, mortgage finance 5,529,659  4,429,489 25%
Loans held for investment 16,764,512  16,183,882 4%
Less: Allowance for credit losses on loans 273,143  244,902 12%
Loans held for investment, net 22,021,028  20,368,469 8%
Premises and equipment, net 81,577  31,050 163%
Accrued interest receivable and other assets 919,071  809,668 14%
Goodwill and intangibles, net 1,496  1,496 %
Total assets$31,629,299 $29,628,249 7%
    
Liabilities and Stockholders’ Equity   
Liabilities:   
Non-interest bearing deposits$9,070,804 $9,352,883 (3)%
Interest bearing deposits 16,794,451  14,526,095 16%
Total deposits 25,865,255  23,878,978 8%
Accrued interest payable 18,679  31,149 (40)%
Other liabilities 696,149  381,951 82%
Short-term borrowings 1,035,000  1,400,000 (26)%
Long-term debt 660,172  858,471 (23)%
Total liabilities 28,275,255  26,550,549 6%
    
Stockholders’ equity:   
Preferred stock, $.01 par value, $1,000 liquidation value:   
Authorized shares - 10,000,000   
Issued shares - 300,000 shares issued at September 30, 2024 and 2023 300,000  300,000 %
Common stock, $.01 par value:   
Authorized shares - 100,000,000   
Issued shares - 51,494,260 and 51,110,447 at September 30, 2024 and 2023, respectively 515  511 1%
Additional paid-in capital 1,054,614  1,039,074 1%
Retained earnings 2,428,940  2,419,555 %
Treasury stock - 5,286,503 and 3,095,444 shares at cost at September 30, 2024 and 2023, respectively (301,868) (175,528)72%
Accumulated other comprehensive loss, net of taxes (128,157) (505,912)(75)%
Total stockholders’ equity 3,354,044  3,077,700 9%
Total liabilities and stockholders’ equity$31,629,299 $29,628,249 7%
         


TEXAS CAPITAL BANCSHARES, INC.    
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)    
(dollars in thousands except per share data)    
 Three Months Ended September 30,Nine Months Ended September 30,
  2024  2023 2024  2023
Interest income    
Interest and fees on loans$361,407 $345,138$1,037,537 $975,443
Investment securities 38,389  27,070 104,117  79,840
Interest bearing cash and cash equivalents 52,737  53,561 150,325  157,568
Total interest income 452,533  425,769 1,291,979  1,212,851
Interest expense    
Deposits 190,255  160,117 547,135  417,602
Short-term borrowings 13,784  19,576 39,316  52,573
Long-term debt 8,392  14,005 33,835  43,270
Total interest expense 212,431  193,698 620,286  513,445
Net interest income 240,102  232,071 671,693  699,406
Provision for credit losses 10,000  18,000 49,000  53,000
Net interest income after provision for credit losses 230,102  214,071 622,693  646,406
Non-interest income    
Service charges on deposit accounts 6,307  5,297 18,557  15,477
Wealth management and trust fee income 4,040  3,509 11,306  10,653
Brokered loan fees 2,400  2,532 6,442  6,842
Investment banking and advisory fees 34,753  23,099 78,225  56,764
Trading income 5,786  6,092 16,148  18,693
Available-for-sale debt securities gains/(losses), net (179,581)  (179,581) 489
Other 11,524  6,343 25,875  21,368
Total non-interest income (114,771) 46,872 (23,028) 130,286
Non-interest expense    
Salaries and benefits 121,138  110,010 368,705  351,730
Occupancy expense 12,937  9,910 33,340  29,011
Marketing 5,863  4,757 17,895  20,168
Legal and professional 11,135  17,614 38,603  47,797
Communications and technology 25,951  19,607 69,078  57,655
Federal Deposit Insurance Corporation insurance assessment 4,906  5,769 18,897  11,632
Other 13,394  12,224 39,608  37,569
Total non-interest expense 195,324  179,891 586,126  555,562
Income/(loss) before income taxes (79,993) 81,052 13,539  221,130
Income tax expense/(benefit) (18,674) 19,373 7,054  52,139
Net income/(loss) (61,319) 61,679 6,485  168,991
Preferred stock dividends 4,313  4,313 12,938  12,938
Net income/(loss) available to common stockholders$(65,632)$57,366$(6,453)$156,053
     
Basic earnings/(loss) per common share$(1.42)$1.19$(0.14)$3.24
Diluted earnings/(loss) per common share$(1.41)$1.18$(0.14)$3.20
           


TEXAS CAPITAL BANCSHARES, INC.
SUMMARY OF CREDIT LOSS EXPERIENCE
(dollars in thousands)
 3rd Quarter2nd Quarter1st Quarter4th Quarter3rd Quarter
  2024  2024  2024  2023  2023 
Allowance for credit losses on loans:     
Beginning balance$267,297 $263,962 $249,973 $244,902 $237,343 
Allowance established for acquired purchase credit deterioration loans 2,579         
Loans charged-off:     
Commercial 6,120  9,997  7,544  8,356  13,246 
Commercial real estate 262  2,111  3,325  5,500   
Consumer 30        41 
Total charge-offs 6,412  12,108  10,869  13,856  13,287 
Recoveries:     
Commercial 329  153  105  15  4,346 
Commercial real estate       4   
Consumer          
Total recoveries 329  153  105  19  4,346 
Net charge-offs 6,083  11,955  10,764  13,837  8,941 
Provision for credit losses on loans 9,350  15,290  24,753  18,908  16,500 
Ending balance$273,143 $267,297 $263,962 $249,973 $244,902 
      
Allowance for off-balance sheet credit losses:     
Beginning balance$45,319 $40,609 $46,362 $46,270 $44,770 
Provision for off-balance sheet credit losses 650  4,710  (5,753) 92  1,500 
Ending balance$45,969 $45,319 $40,609 $46,362 $46,270 
      
Total allowance for credit losses$319,112 $312,616 $304,571 $296,335 $291,172 
Total provision for credit losses$10,000 $20,000 $19,000 $19,000 $18,000 
      
Allowance for credit losses on loans to total loans held for investment 1.23% 1.23% 1.27% 1.23% 1.19%
Allowance for credit losses on loans to average total loans held for investment 1.24% 1.27% 1.32% 1.24% 1.17%
Net charge-offs to average total loans held for investment(1) 0.11% 0.23% 0.22% 0.27% 0.17%
Net charge-offs to average total loans held for investment for last 12 months(1) 0.20% 0.22% 0.20% 0.25% 0.26%
Total provision for credit losses to average total loans held for investment(1) 0.18% 0.38% 0.38% 0.37% 0.34%
Total allowance for credit losses to total loans held for investment 1.43% 1.44% 1.46% 1.46% 1.41%


(1)Interim period ratios are annualized.
  

 

TEXAS CAPITAL BANCSHARES, INC.     
SUMMARY OF NON-PERFORMING ASSETS AND PAST DUE LOANS   
(dollars in thousands)     
 3rd Quarter2nd Quarter1st Quarter4th Quarter3rd Quarter
  2024  2024  2024  2023  2023 
Non-accrual loans held for investment$88,960 $85,021 $92,849 $81,398 $63,129 
Non-accrual loans held for sale(1)     9,250     
Other real estate owned          
Total non-performing assets$88,960 $85,021 $102,099 $81,398 $63,129 
      
Non-accrual loans held for investment to total loans held for investment 0.40% 0.39% 0.45% 0.40% 0.31%
Total non-performing assets to total assets 0.28% 0.28% 0.35% 0.29% 0.21%
Allowance for credit losses on loans to non-accrual loans held for investment3.1x3.1x2.8x3.1x3.9x
Total allowance for credit losses to non-accrual loans held for investment3.6x3.7x3.3x3.6x4.6x
      
Loans held for investment past due 90 days and still accruing$5,281 $286 $3,674 $19,523 $4,602 
Loans held for investment past due 90 days to total loans held for investment 0.02% % 0.02% 0.10% 0.02%
Loans held for sale past due 90 days and still accruing$ $64 $147 $ $ 


(1)First quarter 2024 includes one non-accrual loan previously reported in loans held for investment that was transferred at fair value to held for sale as of March 31, 2024.
  

 

TEXAS CAPITAL BANCSHARES, INC.
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
(dollars in thousands)
      
 3rd Quarter2nd Quarter1st Quarter4th Quarter3rd Quarter
  2024  2024 2023 2023 2023
Interest income     
Interest and fees on loans$361,407 $345,251$330,879$325,210$345,138
Investment securities 38,389  33,584 32,144 28,454 27,070
Interest bearing deposits in other banks 52,737  43,233 54,355 63,408 53,561
Total interest income 452,533  422,068 417,378 417,072 425,769
Interest expense     
Deposits 190,255  181,280 175,600 170,173 160,117
Short-term borrowings 13,784  12,749 12,783 18,069 19,576
Long-term debt 8,392  11,457 13,986 14,113 14,005
Total interest expense 212,431  205,486 202,369 202,355 193,698
Net interest income 240,102  216,582 215,009 214,717 232,071
Provision for credit losses 10,000  20,000 19,000 19,000 18,000
Net interest income after provision for credit losses 230,102  196,582 196,009 195,717 214,071
Non-interest income     
Service charges on deposit accounts 6,307  5,911 6,339 5,397 5,297
Wealth management and trust fee income 4,040  3,699 3,567 3,302 3,509
Brokered loan fees 2,400  2,131 1,911 2,076 2,532
Investment banking and advisory fees 34,753  25,048 18,424 6,906 23,099
Trading income 5,786  5,650 4,712 3,819 6,092
Available-for-sale debt securities gains/(losses), net (179,581)    
Other 11,524  7,985 6,366 9,633 6,343
Total non-interest income (114,771) 50,424 41,319 31,133 46,872
Non-interest expense     
Salaries and benefits 121,138  118,840 128,727 107,970 110,010
Occupancy expense 12,937  10,666 9,737 9,483 9,910
Marketing 5,863  5,996 6,036 5,686 4,757
Legal and professional 11,135  11,273 16,195 17,127 17,614
Communications and technology 25,951  22,013 21,114 23,607 19,607
Federal Deposit Insurance Corporation insurance assessment 4,906  5,570 8,421 25,143 5,769
Other 13,394  14,051 12,163 12,369 12,224
Total non-interest expense 195,324  188,409 202,393 201,385 179,891
Income/(loss) before income taxes (79,993) 58,597 34,935 25,465 81,052
Income tax expense/(benefit) (18,674) 16,935 8,793 5,315 19,373
Net income/(loss) (61,319) 41,662 26,142 20,150 61,679
Preferred stock dividends 4,313  4,312 4,313 4,312 4,313
Net income/(loss) available to common shareholders$(65,632)$37,350$21,829$15,838$57,366
            


TEXAS CAPITAL BANCSHARES, INC.
TAXABLE EQUIVALENT NET INTEREST INCOME ANALYSIS (UNAUDITED)(1)
(dollars in thousands)
 3rd Quarter 2024 2nd Quarter 2024 1st Quarter 2024 4th Quarter 2023 3rd Quarter 2023
 Average
Balance
Income/
Expense
Yield/
Rate
 Average
Balance
Income/
Expense
Yield/
Rate
 Average
Balance
Income/
Expense
Yield/
Rate
 Average
Balance
Income/
Expense
Yield/
Rate
 Average
Balance
Income/
Expense
Yield/
Rate
Assets                   
Investment securities(2)$4,314,834$38,3893.34% $4,427,023$33,5842.80% $4,299,368$32,1442.77% $4,078,975$28,4542.48% $4,204,749$27,0702.33%
Interest bearing cash and cash equivalents 3,958,843 52,7375.30%  3,273,069 43,2335.31%  4,051,627 54,3555.40%  4,637,374 63,4085.42%  3,965,045 53,5615.36%
Loans held for sale 23,793 5659.44%  28,768 6839.55%  51,164 1,1849.31%  29,071 6729.17%  31,878 6478.06%
Loans held for investment, mortgage finance(4) 5,152,317 54,3714.20%  4,357,288 42,7223.94%  3,517,707 31,4553.60%  3,946,280 33,7093.39%  4,697,702 50,8134.29%
Loans held for investment(3)(4) 16,792,446 306,5417.26%  16,750,788 301,9107.25%  16,522,089 298,3067.26%  16,164,233 290,8977.14%  16,317,324 293,7507.14%
Less: Allowance for credit losses on loans 266,915    263,145    249,936    244,287    238,883  
Loans held for investment, net 21,677,848 360,9126.62%  20,844,931 344,6326.65%  19,789,860 329,7616.70%  19,866,226 324,6066.48%  20,776,143 344,5636.58%
Total earning assets 29,975,318 452,6035.96%  28,573,791 422,1325.86%  28,192,019 417,4445.88%  28,611,646 417,1405.69%  28,977,815 425,8415.75%
Cash and other assets 1,239,855    1,177,061    1,058,463    1,120,354    1,106,031  
Total assets$31,215,173   $29,750,852   $29,250,482   $29,732,000   $30,083,846  
                    
Liabilities and Stockholders’ Equity                   
Transaction deposits$1,988,688$15,9723.20% $2,061,622$16,9823.31% $2,006,493$16,8583.38% $1,972,324$15,6133.14% $1,755,451$13,6273.08%
Savings deposits 12,240,616 147,7704.80%  11,981,668 143,1734.81%  11,409,677 136,7904.82%  11,043,155 132,8014.77%  10,858,306 127,3234.65%
Time deposits 2,070,537 26,5135.09%  1,658,899 21,1255.12%  1,719,325 21,9525.14%  1,716,812 21,7595.03%  1,610,235 19,1674.72%
Total interest bearing deposits 16,299,841 190,2554.64%  15,702,189 181,2804.64%  15,135,495 175,6004.67%  14,732,291 170,1734.58%  14,223,992 160,1174.47%
Short-term borrowings 1,012,608 13,7845.42%  927,253 12,7495.53%  912,088 12,7835.64%  1,257,609 18,0695.70%  1,393,478 19,5765.57%
Long-term debt 660,098 8,3925.06%  778,401 11,4575.92%  859,509 13,9866.54%  858,858 14,1136.52%  858,167 14,0056.47%
Total interest bearing liabilities 17,972,547 212,4314.70%  17,407,843 205,4864.75%  16,907,092 202,3694.81%  16,848,758 202,3554.76%  16,475,637 193,6984.66%
Non-interest bearing deposits 9,439,020    8,647,594    8,637,775    9,247,491    10,016,579  
Other liabilities 558,368    537,754    509,286    541,162    474,869  
Stockholders’ equity 3,245,238    3,157,661    3,196,329    3,094,589    3,116,761  
Total liabilities and stockholders’ equity$31,215,173   $29,750,852   $29,250,482   $29,732,000   $30,083,846  
Net interest income $240,172   $216,646   $215,075   $214,785   $232,143 
Net interest margin  3.16%   3.01%   3.03%   2.93%   3.13%


(1)Taxable equivalent rates used where applicable.
(2)Yields on investment securities are calculated using available-for-sale securities at amortized cost.
(3)Average balances include non-accrual loans.
(4)In the first quarter of 2024, enhancements were made to our methodology for applying relationship pricing credits to mortgage client loans. To conform to the current period presentation, certain prior period interest income amounts have been reclassified from loans held for investment, mortgage finance to loans held for investment and related yields have been adjusted accordingly.