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Texas Capital Bancshares, Inc. Announces Operating Results for Q1 2016

DALLAS, April 20, 2016 (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 2016.

“We started 2016 with good core loan growth, and a solid mortgage finance quarter," said Keith Cargill, CEO. "As energy prices remain low across the futures curve, we have accelerated planned loan loss provisions but continue to believe that full-year guidance provided in January will accommodate first quarter provision and potential exposure for the remainder of 2016. Our MCA business continues to gain traction, positioning it to contribute more significantly in the last half of 2016."

  • Loans held for investment ("LHI"), excluding mortgage finance, increased 3% and total LHI increased 2% on a linked quarter basis, growing 12% and 5%, respectively, from the first quarter of 2015.
  • Mortgage finance loans increased less than 1% on a linked quarter basis and decreased 8% from the first quarter of 2015.
  • Demand deposits increased 17% and total deposits increased 8% on a linked quarter basis, growing 23% and 15%, respectively, from the first quarter of 2015.
  • Net income decreased 28% on a linked quarter basis and decreased 28% from the first quarter of 2015.
  • EPS decreased 30% on a linked quarter basis, and decreased 30% from the first quarter of 2015.


FINANCIAL SUMMARY
(dollars and shares in thousands)
Q1 2016 Q1 2015 % Change
QUARTERLY OPERATING RESULTS
Net income $25,128 $35,050 (28)%
Net income available to common stockholders $22,690 $32,612 (30)%
Diluted EPS $0.49 $0.70 (30)%
Diluted shares 46,354 46,368 %
ROA 0.53% 0.84%
ROE 6.13% 9.82%
BALANCE SHEET
Loans held for sale $94,702 $ 100%
LHI, mortgage finance 4,981,304 5,408,750 (8)%
LHI 12,059,849 10,760,978 12%
Total LHI 17,041,153 16,169,728 5%
Total assets 20,210,893 17,326,260 17%
Demand deposits 7,455,107 6,050,817 23%
Total deposits 16,298,847 14,122,306 15%
Stockholders’ equity 1,647,088 1,517,958 9%
Tangible book value per share $32.18 $29.44 9%


DETAILED FINANCIALS
Texas Capital Bancshares, Inc. reported net income of $25.1 million and net income available to common stockholders of $22.7 million for the quarter ended March 31, 2016 compared to net income of $35.1 million and net income available to common stockholders of $32.6 million for the same period in 2015. On a fully diluted basis, earnings per common share were $0.49 for the quarter ended March 31, 2016 compared to $0.70 for the same period of 2015. The decrease reflects a $9.9 million decrease in net income, primarily related to the increased provision for credit losses described in more detail below.

Return on average common equity (“ROE”) was 6.13 percent and return on average assets (“ROA”) was 0.53 percent for the first quarter of 2016, compared to 9.82 percent and 0.84 percent, respectively, for the first quarter of 2015. The decrease in ROE resulted from the increased provision for credit losses. The decrease in ROA resulted from the increased provision for credit losses, reduced yields on loans held for investment, excluding mortgage finance loans, and a $742.7 million increase in average liquidity assets, which include Federal funds sold and deposits in other banks. Average liquidity assets for the first quarter of 2016 totaled $3.0 billion, including $2.6 billion in deposits at the Federal Reserve Bank of Dallas, which had an average yield of 50 basis points, compared to $2.0 billion, which had an average yield of 25 basis points for the first quarter of 2015.

Net interest income was $144.8 million for the first quarter of 2016, compared to $130.0 million for the first quarter of 2015 and $142.2 million for the fourth quarter of 2015. Net interest margin for the first quarter of 2016 was 3.13 percent, a 9 basis point decrease from the first quarter of 2015 and a 12 basis point increase from the fourth quarter of 2015. The year-over-year decrease in net interest margin is due primarily to the increase in liquidity assets, as well as an increase in deposits and borrowings with higher average cost. The cost of total deposits and borrowed funds was 24 basis points for the first quarter of 2016, compared to 17 basis points for the first quarter of 2015 and 18 basis points for the fourth quarter of 2015.

Average LHI, excluding mortgage finance loans, for the first quarter of 2016 were $11.9 billion, an increase of $1.4 billion, or 13 percent, from the first quarter of 2015, and an increase of $217.3 million, or 2 percent, from the fourth quarter of 2015. Average mortgage finance loans for the first quarter of 2016 were $3.7 billion, a decrease of $22.4 million, or less than 1 percent, from the first quarter of 2015 and an increase of $55.5 million, or 2 percent, from the fourth quarter of 2015.

As previously announced, we successfully launched our Mortgage Correspondent Aggregation ("MCA") business late in the third quarter of 2015. As expected, the acquired mortgage assets are providing increases in yields and we anticipate that the MCA business will provide larger balances of loans held for sale and more efficient use of regulatory capital over time. Average loans held for sale for the quarter ended March 31, 2016 increased $101.4 million to $126.1 million compared to $24.7 million for the fourth quarter of 2015.

Average total deposits for the first quarter of 2016 increased $1.9 billion from the first quarter of 2015 and decreased $181.4 million from the fourth quarter of 2015. Average demand deposits for the first quarter of 2016 increased $1.1 billion, or 20 percent, to $6.7 billion from $5.6 billion during the first quarter of 2015 and decreased $25.0 million, or less than 1 percent, from the fourth quarter of 2015.

We recorded a $30.0 million provision for credit losses for the first quarter of 2016 compared to $11.0 million for the first quarter of 2015 and $14.0 million for the fourth quarter of 2015. The provision for the first quarter of 2016 was driven by the application of our methodology. The year-over-year increase was primarily related to a change in applied risk weights, which are based in part on historical loss experience, as well as changes in the composition of our pass-rated and classified loan portfolios, primarily related to energy loans, and growth in traditional LHI, excluding mortgage finance loans. The combined allowance for credit losses at March 31, 2016 increased to 1.43 percent of LHI excluding mortgage finance loans as compared to 1.08 percent at March 31, 2015 and 1.28 percent at December 31, 2015. The increase derived from increases in the provision for credit losses primarily related to energy as well as continuing loan growth in 2016. In management’s opinion, the allowance is appropriate and is derived from consistent application of the methodology for establishing reserves for Texas Capital Bank’s loan portfolio.

We experienced a slight increase in non-performing assets in the first quarter of 2016 on a linked quarter basis, bringing the ratio of total non-performing assets to total LHI plus other real estate owned (“OREO”) to 1.12 percent compared to 0.43 percent for the first quarter of 2015 and 1.08 percent for the fourth quarter of 2015. The increase is primarily related to energy loans, which was expected as energy prices remain low. Net charge-offs for the first quarter of 2016 were $7.4 million compared to net charge-offs of $3.1 million for the first quarter of 2015 and net charge-offs of $2.0 million for the fourth quarter of 2015. For the first quarter of 2016, total charge-offs related to energy loans were $5.9 million. For the first quarter of 2016, net charge-offs were 0.19 percent of total LHI, compared to 0.09 percent for the same period in 2015 and 0.05 percent for the fourth quarter of 2015. At March 31, 2016, total OREO was $17.6 million compared to $605,000 at March 31, 2015 and $278,000 at December 31, 2015. The increase was due to foreclosure of a single commercial property during the first quarter of 2016.

Non-interest income decreased $970,000, or 8 percent, during the first quarter of 2016 compared to the same period of 2015, primarily related to a decrease in swap fees. Swap fees decreased $1.7 million during the first quarter of 2016 compared to the same period of 2015. These fees fluctuate from quarter to quarter based on the number and volume of transactions closed during the quarter.

Non-interest expense for the first quarter of 2016 increased $10.3 million, or 13 percent, compared to the first quarter of 2015. The increase is primarily related to a $5.5 million increase in salaries and employee benefits expense, a $1.3 million increase in legal and professional expense and a $1.1 million increase in communications and technology expense, all of which were due to general business growth. FDIC insurance assessment expense for the first quarter of 2016 increased $1.7 million compared to the same quarter in 2015 as a result of the increase in total assets from March 31, 2015 to March 31, 2016.

Stockholders’ equity increased by 9 percent from $1.5 billion at March 31, 2015 to $1.6 billion at March 31, 2016, primarily due to retention of net income. Texas Capital Bank is well capitalized under regulatory guidelines and at March 31, 2016, our ratio of tangible common equity to total tangible assets was 7.3 percent.

ABOUT TEXAS CAPITAL BANCSHARES, INC.
Texas Capital Bancshares, Inc. (NASDAQ:TCBI), a member of the Russell 2000® Index and the S&P SmallCap 600®, 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 declines and volatility in oil and gas prices, rates of default or loan losses, volatility in the mortgage industry, the success or failure of our business strategies, future financial performance, future growth and earnings, the appropriateness of our allowance for loan losses and provision for credit losses, the impact of increased regulatory requirements and legislative changes on our business, increased competition, interest rate risk, the success or failure of new lines of business and new product or service offerings and the impact of 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
20162015201520152015
CONSOLIDATED STATEMENTS OF INCOME
Interest income$159,803 $154,820 $153,856 $153,374 $140,908
Interest expense15,020 12,632 11,808 11,089 10,899
Net interest income144,783 142,188 142,048 142,285 130,009
Provision for credit losses30,000 14,000 13,750 14,500 11,000
Net interest income after provision for credit losses114,783 128,188 128,298 127,785 119,009
Non-interest income11,297 11,320 11,380 12,771 12,267
Non-interest expense86,820 87,042 81,688 81,276 76,517
Income before income taxes39,260 52,466 57,990 59,280 54,759
Income tax expense14,132 17,713 20,876 21,343 19,709
Net income25,128 34,753 37,114 37,937 35,050
Preferred stock dividends2,438 2,437 2,438 2,437 2,438
Net income available to common stockholders$22,690 $32,316 $34,676 $35,500 $32,612
Diluted EPS$.49 $.70 $.75 $.76 $.70
Diluted shares46,354,378 46,479,845 46,471,390 46,443,413 46,367,870
CONSOLIDATED BALANCE SHEET DATA
Total assets$20,210,893 $18,903,821 $18,666,708 $17,818,030 $17,326,260
LHI12,059,849 11,745,674 11,562,828 11,123,325 10,760,978
LHI, mortgage finance4,981,304 4,966,276 4,312,790 4,906,415 5,408,750
Loans held for sale, at fair value94,702 86,075 1,062
Liquidity assets2,644,418 1,681,374 2,345,192 1,337,364 734,945
Securities28,461 29,992 31,998 35,361 37,649
Demand deposits7,455,107 6,386,911 6,545,273 6,479,073 6,050,817
Total deposits16,298,847 15,084,619 15,165,345 14,188,276 14,122,306
Other borrowings1,704,859 1,643,051 1,353,834 1,509,007 1,125,458
Subordinated notes280,773 280,682 280,592 280,501 280,411
Long-term debt113,406 113,406 113,406 113,406 113,406
Stockholders’ equity1,647,088 1,623,533 1,590,051 1,554,529 1,517,958
End of period shares outstanding45,902,489 45,873,807 45,839,364 45,812,971 45,772,245
Book value$32.61 $32.12 $31.42 $30.66 $29.89
Tangible book value(1)$32.18 $31.69 $30.98 $30.22 $29.44
SELECTED FINANCIAL RATIOS
Net interest margin3.13%3.01%3.12%3.22%3.22%
Return on average assets0.53%0.72%0.79%0.83%0.84%
Return on average common equity6.13%8.82%9.69%10.32%9.82%
Non-interest income to earning assets0.24%0.24%0.25%0.29%0.30%
Efficiency ratio(2)55.6%56.7%53.2%52.4%53.8%
Non-interest expense to earning assets1.88%1.84%1.80%1.84%1.89%
Tangible common equity to total tangible assets(3)7.3%7.7%7.6%7.8%7.8%
Common Equity Tier 17.5%7.5%7.7%7.4%7.2%
Tier 1 capital8.8%8.8%9.1%8.8%8.6%
Total capital11.1%11.1%11.4%11.0%10.7%
Leverage9.1%8.9%9.1%9.0%9.5%

(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 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, 2016 March 31, 2015 %
Change
Assets
Cash and due from banks$89,277 $99,602 (10)%
Interest-bearing deposits2,614,418 734,945 256%
Federal funds sold and securities purchased under resale agreements30,000 100%
Securities, available-for-sale28,461 37,649 (24)%
Loans held for sale, at fair value94,702 100%
LHI, mortgage finance4,981,304 5,408,750 (8)%
LHI (net of unearned income)12,059,849 10,760,978 12%
Less: Allowance for loan losses162,510 108,078 50%
LHI, net16,878,643 16,061,650 5%
Mortgage servicing rights, net4,253 100%
Premises and equipment, net22,924 22,428 2%
Accrued interest receivable and other assets428,344 349,574 23%
Goodwill and intangibles, net19,871 20,412 (3)%
Total assets$20,210,893 $17,326,260 17%
Liabilities and Stockholders’ Equity
Liabilities:
Deposits:
Non-interest bearing$7,455,107 $6,050,817 23%
Interest bearing8,843,740 7,816,310 13%
Interest bearing in foreign branches 255,179 (100)%
Total deposits16,298,847 14,122,306 15%
Accrued interest payable2,880 2,545 13%
Other liabilities163,040 164,176 (1)%
Federal funds purchased and repurchase agreements100,859 125,458 (20)%
Other borrowings1,604,000 1,000,000 60%
Subordinated notes280,773 280,411
Trust preferred subordinated debentures113,406 113,406
Total liabilities18,563,805 15,808,302 17%
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, 2016 and 2015150,000 150,000
Common stock, $.01 par value:
Authorized shares - 100,000,000
Issued shares - 45,902,906 and 45,772,662 at March 31, 2016 and 2015, respectively459 457 %
Additional paid-in capital715,435 710,943 1%
Retained earnings780,508 655,326 19%
Treasury stock (shares at cost: 417 at March 31, 2016 and 2015)(8)(8)
Accumulated other comprehensive income, net of taxes694 1,240 (44)%
Total stockholders’ equity1,647,088 1,517,958 9%
Total liabilities and stockholders’ equity$20,210,893 $17,326,260 17%




TEXAS CAPITAL BANCSHARES, INC.
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
(Dollars in thousands except per share data)
Three Months Ended
March 31
2016 2015
Interest Income
Interest and fees on loans$155,885 $139,174
Securities261 358
Federal funds sold372 116
Deposits in other banks3,285 1,260
Total interest income159,803 140,908
Interest expense
Deposits8,822 5,628
Federal funds purchased126 68
Repurchase agreements3 4
Other borrowings1,162 390
Subordinated notes4,191 4,191
Trust preferred subordinated debentures716 618
Total interest expense15,020 10,899
Net interest income144,783 130,009
Provision for credit losses30,000 11,000
Net interest income after provision for credit losses114,783 119,009
Non-interest income
Service charges on deposit accounts2,110 2,094
Trust fee income813 1,200
Bank owned life insurance (BOLI) income536 484
Brokered loan fees4,645 4,232
Swap fees307 1,986
Other2,886 2,271
Total non-interest income11,297 12,267
Non-interest expense
Salaries and employee benefits51,372 45,828
Net occupancy expense5,812 5,691
Marketing3,908 4,218
Legal and professional5,324 4,048
Communications and technology6,217 5,078
FDIC insurance assessment5,469 3,790
Allowance and other carrying costs for OREO236 9
Other8,482 7,855
Total non-interest expense86,820 76,517
Income before income taxes39,260 54,759
Income tax expense14,132 19,709
Net income25,128 35,050
Preferred stock dividends2,438 2,438
Net income available to common stockholders$22,690 $32,612
Basic earnings per common share$0.49 $0.71
Diluted earnings per common share$0.49 $0.70





TEXAS CAPITAL BANCSHARES, INC.
SUMMARY OF LOAN LOSS EXPERIENCE
(Dollars in thousands)
1st Quarter 4th Quarter 3rd Quarter 2nd Quarter 1st Quarter
2016 2015 2015 2015 2015
Allowance for loan losses:
Beginning balance$141,111 $130,540 $118,770 $108,078 $100,954
Loans charged-off:
Commercial8,496 4,976 2,758 5,418 3,102
Real estate 43 346
Consumer 62
Leases 25
Total charge-offs8,496 5,019 2,783 5,418 3,510
Recoveries:
Commercial1,040 2,846 388 1,424 286
Real estate8 5 8 12 8
Construction 3 42 272 83
Consumer7 154 9 6 4
Leases45 11 4 15 8
Total recoveries1,100 3,019 451 1,729 389
Net charge-offs7,396 2,000 2,332 3,689 3,121
Provision for loan losses28,795 12,571 14,102 14,381 10,245
Ending balance$162,510 $141,111 $130,540 $118,770 $108,078
Allowance for off-balance sheet credit losses:
Beginning balance$9,011 $7,582 $7,934 $7,815 $7,060
Provision for off-balance sheet credit losses1,205 1,429 (352)119 755
Ending balance$10,216 $9,011 $7,582 $7,934 $7,815
Total allowance for credit losses$172,726 $150,122 $138,122 $126,704 $115,893
Total provision for credit losses$30,000 $14,000 $13,750 $14,500 $11,000
Allowance for loan losses to LHI0.95%0.84%0.82%0.74%0.67%
Allowance for loan losses to LHI excluding mortgage finance loans(2)1.35%1.20%1.13%1.07%1.00%
Allowance for loan losses to average LHI1.04%0.92%0.85%0.77%0.76%
Allowance for loan losses to average LHI excluding mortgage finance loans(2)1.36%1.21%1.15%1.09%1.03%
Net charge-offs to average LHI(1)0.19%0.05%0.06%0.10%0.09%
Net charge-offs to average LHI excluding mortgage finance loans(1)(2)0.25%0.07%0.08%0.14%0.12%
Net charge-offs to average LHI for last twelve months(1)0.10%0.07%0.07%0.06%0.06%
Net charge-offs to average LHI, excluding mortgage finance loans, for last twelve months(1)(2)0.14%0.10%0.10%0.08%0.08%
Total provision for credit losses to average LHI(1)0.77%0.36%0.36%0.37%0.31%
Total provision for credit losses to average LHI excluding mortgage finance loans(1)(2)1.01%0.47%0.48%0.53%0.42%
Combined allowance for credit losses to LHI1.01%0.90%0.87%0.79%0.72%
Combined allowance for credit losses to LHI, excluding mortgage finance loans(2)1.43%1.28%1.19%1.14%1.08%
Non-performing assets (NPAs):
Non-accrual loans$173,156 $179,788 $109,674 $122,920 $68,307
Other real estate owned (OREO)17,585 278 187 609 605
Total$190,741 $180,066 $109,861 $123,529 $68,912





1st Quarter 4th Quarter 3rd Quarter 2nd Quarter 1st Quarter
2016 2015 2015 2015 2015
Non-accrual loans to LHI1.02%1.08%0.69%0.77%0.42%
Non-accrual loans to LHI excluding mortgage finance loans(2)1.44%1.53%0.95%1.11%0.63%
Total NPAs to LHI plus OREO1.12%1.08%0.69%0.77%0.43%
Total NPAs to LHI excluding mortgage finance loans plus OREO(2)1.58%1.53%0.95%1.11%0.64%
Total NPAs to earning assets0.97%0.99%0.61%0.72%0.41%
Allowance for loan losses to non-accrual loans0.9x0.8x1.2x1.0x1.6x
Restructured loans$249 $249 $249 $249 $319
Loans past due 90 days and still accruing(3)$10,100 $7,013 $7,558 $5,482 $2,971
Loans past due 90 days to LHI0.06%0.04%0.05%0.03%0.02%
Loans past due 90 days to LHI excluding mortgage finance loans(2)0.08%0.06%0.07%0.05%0.03%

(1) Interim period ratios are annualized.
(2) The indicated ratios are presented with and excluding the mortgage finance loans because the risk profile of our mortgage finance loans is different than our other loans held for investment. No provision for credit losses is allocated to these loans based on the internal risk grade assigned.
(3) At March 31, 2016, loans past due 90 days and still accruing includes premium finance loans of $6.1 million. These loans are primarily secured by obligations of insurance carriers to refund premiums on cancelled insurance policies. The refund of premiums from the insurance carriers can take 180 days or longer from the cancellation date.




TEXAS CAPITAL BANCSHARES, INC.
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
(Dollars in thousands)
1st Quarter 4th Quarter 3rd Quarter 2nd Quarter 1st Quarter
2016 2015 2015 2015 2015
Interest income
Interest and fees on loans$155,885 $152,200 $151,749 $151,606 $139,174
Securities261 275 298 323 358
Federal funds sold372 255 193 118 116
Deposits in other banks3,285 2,090 1,616 1,327 1,260
Total interest income159,803 154,820 153,856 153,374 140,908
Interest expense
Deposits8,822 7,068 6,240 5,642 5,628
Federal funds purchased126 67 56 93 68
Repurchase agreements3 5 6 4 4
Other borrowings1,162 642 672 528 390
Subordinated notes4,191 4,191 4,191 4,191 4,191
Trust preferred subordinated debentures716 659 643 631 618
Total interest expense15,020 12,632 11,808 11,089 10,899
Net interest income144,783 142,188 142,048 142,285 130,009
Provision for credit losses30,000 14,000 13,750 14,500 11,000
Net interest income after provision for credit losses114,783 128,188 128,298 127,785 119,009
Non-interest income
Service charges on deposit accounts2,110 1,984 2,096 2,149 2,094
Trust fee income813 1,313 1,222 1,287 1,200
Bank owned life insurance (BOLI) income536 567 484 476 484
Brokered loan fees4,645 4,267 4,885 5,277 4,232
Swap fees307 1,000 254 1,035 1,986
Other2,886 2,189 2,439 2,547 2,271
Total non-interest income11,297 11,320 11,380 12,771 12,267
Non-interest expense
Salaries and employee benefits51,372 49,999 48,583 48,200 45,828
Net occupancy expense5,812 5,809 5,874 5,808 5,691
Marketing3,908 4,349 3,999 3,925 4,218
Legal and professional5,324 6,974 5,510 5,618 4,048
Communications and technology6,217 5,520 5,180 5,647 5,078
FDIC insurance assessment5,469 4,741 4,489 4,211 3,790
Allowance and other carrying costs for OREO236 6 1 6 9
Other8,482 9,644 8,052 7,861 7,855
Total non-interest expense86,820 87,042 81,688 81,276 76,517
Income before income taxes39,260 52,466 57,990 59,280 54,759
Income tax expense14,132 17,713 20,876 21,343 19,709
Net income25,128 34,753 37,114 37,937 35,050
Preferred stock dividends2,438 2,437 2,438 2,437 2,438
Net income available to common shareholders$22,690 $32,316 $34,676 $35,500 $32,612




TEXAS CAPITAL BANCSHARES, INC.
QUARTERLY FINANCIAL SUMMARY - UNAUDITED
Consolidated Daily Average Balances, Average Yields and Rates
(Dollars in thousands)
1st Quarter 2016 4th Quarter 2015 3rd Quarter 2015 2nd Quarter 2015 1st Quarter 2015
Average
Balance
Revenue/
Expense(1)
Yield/
Rate
Average
Balance
Revenue/
Expense(1)
Yield/
Rate
Average
Balance
Revenue/
Expense(1)
Yield/
Rate
Average
Balance
Revenue/
Expense(1)
Yield/
Rate
Average
Balance
Revenue/
Expense(1)
Yield/
Rate
Assets
Securities - Taxable$28,343 $254 3.60% $29,973 $267 3.53% $32,358 $287 3.52% $35,081 $311 3.56% $37,145 $332 3.62%
Securities - Non-taxable(2)759 11 5.70% 829 12 5.74% 1,162 17 5.80% 1,427 18 5.06% 2,785 40 5.82%
Federal funds sold and
securities purchased under
resale agreements
304,425 372 0.49% 375,181 255 0.27% 308,822 193 0.25% 200,690 118 0.24% 191,297 116 0.25%
Deposits in other banks2,649,164 3,285 0.50% 3,081,882 2,090 0.27% 2,537,033 1,616 0.25% 2,103,732 1,327 0.25% 2,019,567 1,260 0.25%
Loans held for sale, at fair value126,084 1,094 3.49% 24,658 237 3.81% 570 6 4.18%
LHI, mortgage finance loans3,724,513 29,037 3.14% 3,669,022 27,846 3.01% 3,981,731 30,427 3.03% 4,573,478 33,773 2.96% 3,746,938 27,631 2.99%
LHI11,910,788 125,754 4.25% 11,693,464 124,117 4.21% 11,302,248 121,316 4.26% 10,941,029 117,833 4.32% 10,502,172 111,543 4.31%
Less allowance for loan
losses
141,125 130,822 118,543 109,086 101,042
LHI, net of allowance15,494,176 154,791 4.02% 15,231,664 151,963 3.96% 15,165,436 151,743 3.97% 15,405,421 151,606 3.95% 14,148,068 139,174 3.99%
Total earning assets18,602,951 159,807 3.46% 18,744,187 154,824 3.28% 18,045,381 153,862 3.38% 17,746,351 153,380 3.47% 16,398,862 140,922 3.49%
Cash and other assets506,025 499,712 481,378 487,475 453,381
Total assets$19,108,976 $19,243,899 $18,526,759 $18,233,826 $16,852,243
Liabilities and Stockholders’ Equity
Transaction deposits$2,004,817 $1,381 0.28% $2,150,740 $950 0.18% $1,754,940 $763 0.17% $1,404,521 $458 0.13% $1,401,626 $444 0.13%
Savings deposits6,335,425 6,714 0.43% 6,316,191 5,370 0.34% 5,858,381 4,616 0.31% 5,610,277 4,332 0.31% 5,891,344 4,420 0.30%
Time deposits509,762 727 0.57% 539,421 748 0.55% 536,531 723 0.53% 516,582 657 0.51% 447,681 506 0.46%
Deposits in foreign branches % % 179,731 138 0.30% 246,035 195 0.32% 304,225 258 0.34%
Total interest bearing deposits8,850,004 8,822 0.40% 9,006,352 7,068 0.31% 8,329,583 6,240 0.30% 7,777,415 5,642 0.29% 8,044,876 5,628 0.28%
Other borrowings1,346,998 1,292 0.39% 1,327,087 714 0.21% 1,459,864 734 0.20% 1,565,874 625 0.16% 1,172,675 462 0.16%
Subordinated notes280,713 4,191 6.00% 280,622 4,191 5.93% 280,532 4,191 5.93% 280,441 4,191 5.99% 280,351 4,191 6.06%
Trust preferred subordinated debentures113,406 716 2.54% 113,406 659 2.31% 113,406 643 2.25% 113,406 631 2.23% 113,406 618 2.21%
Total interest bearing liabilities10,591,121 15,021 0.57% 10,727,467 12,632 0.47% 10,183,385 11,808 0.46% 9,737,136 11,089 0.46% 9,611,308 10,899 0.46%
Demand deposits6,730,586 6,755,615 6,621,159 6,804,994 5,592,124
Other liabilities148,418 157,425 152,154 161,614 152,639
Stockholders’ equity1,638,851 1,603,392 1,570,061 1,530,082 1,496,172
Total liabilities and stockholders’ equity$19,108,976 $19,243,899 $18,526,759 $18,233,826 $16,852,243
Net interest income(2) $144,786 $142,192 $142,054 $142,291 $130,023
Net interest margin 3.13% 3.01% 3.12% 3.22% 3.22%

(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.




MEDIA & INVESTOR CONTACT Heather Worley, 214.932.6646 heather.worley@texascapitalbank.com

Source:Texas Capital Bancshares, Inc.