Texas Capital Bancshares, Inc. Announces Operating Results for Q2 2013

Texas Capital Bancshares, Inc.

DALLAS, July 24, 2013 (GLOBE NEWSWIRE) -- Texas Capital Bancshares, Inc. (Nasdaq:TCBI), the parent company of Texas Capital Bank, announced earnings and operating results for the second quarter of 2013.

  • Net income decreased 27% on a linked quarter basis and decreased 19% from the second quarter of 2012 (12% decrease on a linked quarter basis and 2% decrease from the second quarter of 2012 excluding charge related to organizational change)
  • EPS decreased 35% on a linked quarter basis and 32% from the second quarter of 2012 (20% decrease on a linked quarter basis and 16% decrease from the second quarter of 2012 excluding charge related to organizational change)
  • Demand deposits increased 11% and total deposits increased 3% on a linked quarter basis; grew 45% and 20%, respectively, from the second quarter of 2012
  • Loans held for investment increased 9% and total loans increased 9% on a linked quarter basis; both grew 20% from the second quarter of 2012, resulting in a significant increase in the provision

"We are very pleased with the extraordinary growth in loans held for investment, the substantial growth in demand deposits and continued strong core earnings," said George Jones, CEO. "They are the basis on which we are building the potential for a very positive future in earnings and shareholder returns."

FINANCIAL SUMMARY
(dollars and shares in thousands)
Q2 2013 Q2 2012 % Change
QUARTERLY OPERATING RESULTS(1)
Net Income $24,072 $29,623 (19)%
Net Income Available to Common Shareholders $21,634 $29,623 (27)%
Diluted EPS $.52 $.76 (32)%
ROA .95% 1.40%
ROE 9.94% 18.08%
Diluted Shares 41,724 39,142
BALANCE SHEET(1)
Total Assets $10,977,990 $9,144,360 20%
Demand Deposits 2,928,735 2,019,473 45%
Total Deposits 7,980,598 6,660,290 20%
Loans Held for Investment 7,510,662 6,234,692 20%
Total Loans 10,348,896 8,642,724 20%
Stockholders' Equity 1,034,955 680,705 52%
(1) Operating results, assets and loans are reporting from continuing operations

DETAILED FINANCIALS

Texas Capital Bancshares, Inc. reported net income from continuing operations of $24.1 million and net income available to common shareholders of $21.6 million for the quarter ended June 30, 2013, compared to $29.6 million for both net income from continuing operations and net income available to common shareholders for the second quarter of 2012. On a fully diluted basis, earnings per common share from continuing operations were $.52 for the three months ended June 30, 2013, compared to $.76 for the same period last year. The three months ended June 30, 2013, includes the first full quarter of preferred stock dividends which is approximately $.06 per share. The discussion below relates only to continuing operations.

Return on average common equity was 9.94 percent and return on average assets was .95 percent for the second quarter of 2013, compared to 18.08 percent and 1.40 percent, respectively, for the second quarter of 2012.

Net interest income was $101.2 million for the second quarter of 2013, compared to $98.0 million in the first quarter of 2013 and $90.6 million for the second quarter of 2012. The net interest margin in the second quarter of 2013 was 4.19 percent, a 30 basis point decrease from the second quarter of 2012 and an 8 basis point decrease from the first quarter of 2013. The year over year decrease in net interest margin is due to the growth in loans with lower yields offset with a reduction in the total cost of deposits and borrowed funds. Compared to the second quarter of 2012, the issuance in subordinated capital notes during September 2012 had a 7 basis point impact on the net interest margin. The year over year growth in loans more than compensated for the reduction in yields and produced strong growth in net interest income.

Average loans held for investment for the second quarter of 2013 were $7.1 billion, an increase of $1.2 billion from the second quarter of 2012 and $309.6 million from the first quarter of 2013. Average loans held for sale for the second quarter of 2013 increased $343.8 million compared to the second quarter of 2012 and increased $43.6 million from the first quarter of 2013.

Average total deposits for the second quarter of 2013 increased by $1.8 billion from the second quarter of 2012 and increased by $525.8 million from the first quarter of 2013. For the same periods, the average balance of demand deposits increased by $1.0 billion, or 56 percent, to $2.9 billion from $1.9 billion during the second quarter of 2012 and increased $384.4 million from the first quarter of 2013.

In the second quarter of 2013, we experienced continued decreases in levels of non-performing assets. Credit costs, including the provision for credit losses and valuation charges related to other real estate owned ("OREO") totaled $7.4 million in the second quarter of 2013 compared to $4.1 million in the second quarter of 2012 and $2.1 million in the first quarter of 2013. We recorded a $7.0 million provision for credit losses in the second quarter of 2013 compared to $1.0 million in the second quarter of 2012 and $2.0 million in the first quarter of 2013. The substantial majority of the provision in the second quarter of 2013 was directly related to the significant growth in loans held for investment during the quarter. Due to growth and improving credit quality, at June 30, 2013, the combined reserve decreased to 1.11 percent of loans held for investment as compared to 1.21 percent at June 30, 2012 and 1.14 percent at March 31, 2013. In management's opinion, the reserve is appropriate and is derived from consistent application of the methodology for establishing the adequacy of reserves for Texas Capital Bank's loan portfolio. In the second quarter of 2013, net charge-offs were $2.4 million, compared to net charge-offs of $533,000 in the second quarter of 2012 and net charge-offs of $1.2 million in the first quarter of 2013. For the first half of 2013, the net charge-off ratio was 10 basis points compared to 5 basis points for the same period in 2012. Non-accrual loans were $38.5 million, or .51 percent of loans held for investment at the end of the second quarter of 2013, $56.4 million, or .91 percent, at the end of the second quarter of 2012 and $43.4 million, or .63 percent, at the end of the first quarter 2013. At June 30, 2013, total OREO was $13.1 million compared to $27.9 million at the end of the second quarter of 2012, and $14.4 million at the end of the first quarter of 2013. The OREO balance of $13.1 million at June 30, 2013, is stated net of a $4.6 million valuation allowance. The valuation charge for OREO reflected in non-interest expense was $383,000 in the second quarter of 2013 compared to $3.1 million in the second quarter of 2012 and $71,000 in the first quarter of 2013.

Non-interest income increased $666,000 during the second quarter of 2013, or 6 percent, compared to the same period of 2012 primarily related to a $650,000 increase in brokered loan fees earned in the mortgage finance division. Swap fee income increased $359,000 during the second quarter of 2013 due to an increase in swap transactions as compared to the same period in 2012. Offsetting these increases was a $380,000 decrease in other non-interest income during the second quarter of 2013 as compared to the same period in 2012.

Non-interest expense for the second quarter of 2013 increased $14.7 million, or 27 percent, to $68.7 million from $54.0 million in the second quarter of 2012. The increase is primarily related to a $15.0 million increase in salaries and employee benefits to $45.2 million from $30.2 million. Of the $15.0 million increase, approximately $7.7 million related to a charge taken to reflect the financial effect of the organizational change announced during the second quarter of 2013 and includes assumptions about future payouts that may or may not happen, but are required to be estimated at the time of the event. Additionally, there was another $2.2 million of charges related to the increased probability that certain company financial performance targets for executive cash-based incentives will be met. These incentives are expensed based on current stock prices. The remaining $5.1 million increase from the second quarter of 2012 was primarily due to general business growth and costs of cash-based incentives resulting from the increase in stock price. Marketing expense increased $900,000 from the second quarter of 2012 due to expansion of customer bases in both loans and deposits. Legal and professional expense increased $1.4 million from the second quarter of 2012 due to general business growth. Allowance and other carrying costs for OREO expense decreased $3.3 million to $482,000, which included a $383,000 valuation expense. The $383,000 valuation expense in the second quarter of 2013 includes $219,000 related to direct write-downs of the OREO balance and $164,000 related to increasing the valuation allowance for the second quarter of 2013, compared to $423,000 related to direct write-downs and $2.7 million related to increasing the valuation allowance for the second quarter of 2012.

Stockholders' equity increased 52 percent from $680.7 million at June 30, 2012 to $1.0 billion at June 30, 2013, primarily related to the offering of 2.3 million common shares for net proceeds of $87 million in the third quarter of 2012, the offering of 6.0 million shares of preferred shares for proceeds of $145.1 million in the first quarter of 2013 and retained net income. The Bank is well capitalized under regulatory guidelines and at June 30, 2013, the Company's ratio of tangible common equity to total tangible assets was 7.9 percent.

ABOUT TEXAS CAPITAL BANCSHARES, INC.

Texas Capital Bancshares, Inc. (Nasdaq:TCBI) is the parent company of Texas Capital Bank, a commercial bank that delivers highly personalized financial services to businesses and individuals. Headquartered in Dallas, the Bank has full-service locations in Austin, Dallas, Fort Worth, Houston and San Antonio.

This release contains forward-looking statements, which are subject to risks and uncertainties. A number of factors, many of which are beyond Texas Capital Bancshares' control, could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. These risks and uncertainties include the risk of adverse impacts from general economic conditions, competition, interest rate sensitivity and exposure to regulatory and legislative changes. These and other factors that could cause results to differ materially from those described in the forward-looking statements can be found in the Form 10-K and other filings made by Texas Capital Bancshares with the Securities and Exchange Commission.

TEXAS CAPITAL BANCSHARES, INC.
SELECTED FINANCIAL HIGHLIGHTS (UNAUDITED)
(Dollars in thousands except per share data)
2nd Quarter
2013
1st Quarter
2013
4th Quarter
2012
3rd Quarter
2012
2nd Quarter
2012
CONSOLIDATED STATEMENT OF INCOME
Interest income $107,264 $104,179 $107,769 $102,011 $95,546
Interest expense 6,044 6,137 6,614 5,156 4,906
Net interest income 101,220 98,042 101,155 96,855 90,640
Provision for credit losses 7,000 2,000 4,500 3,000 1,000
Net interest income after provision for credit losses 94,220 96,042 96,655 93,855 89,640
Non-interest income 11,128 11,281 12,836 10,552 10,462
Non-interest expense 68,734 55,700 60,074 53,521 53,973
Income from continuing operations before income taxes 36,614 51,623 49,417 50,886 46,129
Income tax expense 12,542 18,479 17,982 18,316 16,506
Income from continuing operations 24,072 33,144 31,435 32,570 29,623
Income (loss) from discontinued operations (after-tax) 1 (1) (6) (34) (1)
Net income 24,073 33,143 31,429 32,536 29,622
Preferred stock dividends 2,438 81
Net income available to common shareholders $21,635 $33,062 $31,429 $32,536 $29,622
Diluted EPS from continuing operations $.52 $.80 $.76 $.80 $.76
Diluted EPS $.52 $.80 $.76 $.80 $.76
Diluted shares 41,723,525 41,429,244 41,505,026 40,755,733 39,141,544
CONSOLIDATED BALANCE SHEET DATA
Total assets $10,977,990 $10,020,565 $10,540,542 $9,881,362 $9,144,360
Loans held for investment 7,510,662 6,920,011 6,785,535 6,549,089 6,234,692
Loans held for sale 2,838,234 2,577,830 3,175,272 2,818,622 2,408,032
Securities 75,861 87,527 100,195 107,288 114,964
Demand deposits 2,928,735 2,628,446 2,535,375 2,114,279 2,019,473
Total deposits 7,980,598 7,745,831 7,440,804 6,717,579 6,660,290
Other borrowings 1,634,630 938,134 1,947,161 2,046,169 1,609,039
Subordinated notes 111,000 111,000 111,000 111,000
Long-term debt 113,406 113,406 113,406 113,406 113,406
Stockholders' equity 1,034,955 1,013,195 836,242 802,406 680,705
End of period shares outstanding 40,862,481 40,771,414 40,727,579 40,580,283 38,114,012
Book value (excluding securities gains/losses) $21.60 $21.10 $20.45 $19.68 $17.75
Tangible book value (excluding securities gains/losses) $21.08 $20.62 $19.96 $19.18 $17.22
SELECTED FINANCIAL RATIOS
Net interest margin 4.19% 4.27% 4.27% 4.36% 4.49%
Return on average assets 0.95% 1.38% 1.27% 1.40% 1.40%
Return on average common equity 9.94% 15.82% 15.35% 17.27% 18.08%
Non-interest income to earning assets .46% .49% .54% .47% .52%
Efficiency ratio 61.2% 50.9% 52.7% 49.8% 53.4%
Efficiency ratio (excluding OREO valuation/write-down) 60.8% 50.9% 51.9% 49.8% 50.3%
Non-interest expense to earning assets 2.84% 2.42% 2.53% 2.40% 2.67%
Non-interest expense to earning assets (excluding OREO valuation charge) 2.83% 2.42% 2.49% 2.40% 2.52%
Tangible common equity to total tangible assets 7.9% 8.4% 7.7% 7.9% 7.2%
TEXAS CAPITAL BANCSHARES, INC.
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(Dollars in thousands)
June 30,
2013
June 30,
2012
%
Change
Assets
Cash and due from banks $90,992 $93,377 (3)%
Interest-bearing deposits 142,928 49,254 190%
Federal funds sold 85,120 20 N/M
Securities, available-for-sale 75,861 114,964 (34)%
Loans held for sale 2,838,234 2,408,032 18%
Loans held for sale from discontinued operations 298 388 (23)%
Loans held for investment (net of unearned income) 7,510,662 6,234,692 20%
Less: Allowance for loan losses 79,428 72,404 10%
Loans held for investment, net 7,431,234 6,162,288 21%
Premises and equipment, net 11,915 12,037 (1)%
Accrued interest receivable and other assets 280,067 284,207 (1)%
Goodwill and intangibles, net 21,639 20,181 7%
Total assets $10,978,288 $9,144,748 20%
Liabilities and Stockholders' Equity
Liabilities:
Deposits:
Non-interest bearing $2,928,735 $2,019,473 45%
Interest bearing 4,702,902 4,230,806 11%
Interest bearing in foreign branches 348,961 410,011 (15)%
Total deposits 7,980,598 6,660,290 20%
Accrued interest payable 1,023 887 15%
Other liabilities 102,676 80,421 27%
Federal funds purchased 307,515 271,835 13%
Repurchase agreements 27,079 22,148 22%
Other borrowings 1,300,036 1,315,056 (1)%
Subordinated notes 111,000 100%
Trust preferred subordinated debentures 113,406 113,406
Total liabilities 9,943,333 8,464,043 17%
Stockholders' equity:
Preferred stock, $.01 par value, $1,000 liquidation value: 150,000 100%
Common stock, $.01 par value:
Authorized shares – 100,000,000
Issued shares – 40,862,898 and 38,114,429 at June 30, 2013 and 2012, respectively 408 381 7%
Additional paid-in capital 445,270 357,713 24%
Retained earnings 437,152 318,490 37%
Treasury stock (shares at cost: 417 at June 30, 2013 and 2012, respectively) (8) (8)
Accumulated other comprehensive income, net of taxes 2,133 4,129 (48)%
Total stockholders' equity 1,034,955 680,705 52%
Total liabilities and stockholders' equity $10,978,288 $9,144,748 20%
TEXAS CAPITAL BANCSHARES, INC.
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
(Dollars in thousands except per share data)
Three Months Ended
June 30
Six Months Ended
June 30
2013 2012 2013 2012
Interest income
Interest and fees on loans $106,418 $94,291 $209,600 $186,065
Securities 773 1,203 1,712 2,510
Federal funds sold 13 4 19 5
Deposits in other banks 60 48 112 97
Total interest income 107,264 95,546 211,443 188,677
Interest expense
Deposits 3,228 3,482 6,473 6,954
Federal funds purchased 206 240 418 521
Repurchase agreements 5 4 9 7
Other borrowings 143 492 356 927
Subordinated notes 1,829 3,658
Trust preferred subordinated debentures 633 688 1,267 1,399
Total interest expense 6,044 4,906 12,181 9,808
Net interest income 101,220 90,640 199,262 178,869
Provision for credit losses 7,000 1,000 9,000 4,000
Net interest income after provision for credit losses 94,220 89,640 190,262 174,869
Non-interest income
Service charges on deposit accounts 1,749 1,624 3,450 3,228
Trust fee income 1,269 1,232 2,510 2,346
Bank owned life insurance (BOLI) income 463 588 961 1,109
Brokered loan fees 4,778 4,128 9,522 7,779
Swap fees 981 622 2,633 1,419
Other 1,888 2,268 3,333 3,771
Total non-interest income 11,128 10,462 22,409 19,652
Non-interest expense
Salaries and employee benefits 45,191 30,230 78,732 59,249
Net occupancy expense 4,135 3,679 7,992 7,283
Marketing 4,074 3,174 8,046 5,997
Legal and professional 4,707 3,330 8,647 7,321
Communications and technology 3,347 2,720 6,469 5,203
Allowance and other carrying costs for OREO 482 3,812 912 7,154
Other 6,798 7,028 13,636 14,042
Total non-interest expense 68,734 53,973 124,434 106,249
Income from continuing operations before income taxes 36,614 46,129 88,237 88,272
Income tax expense 12,542 16,506 31,021 31,568
Income from continuing operations 24,072 29,623 57,216 56,704
Income (loss) from discontinued operations (after-tax) 1 (1) 3
Net income 24,073 29,622 57,216 56,707
Preferred stock dividends 2,438 2,519
Net income available to common shareholders $21,635 $29,622 $54,697 $56,707
Basic earnings per common share:
Income from continuing operations $.53 $.78 $1.34 $1.50
Net income $.53 $.78 $1.34 $1.50
Diluted earnings per common share:
Income from continuing operations $.52 $.76 $1.31 $1.45
Net income $.52 $.76 $1.31 $1.45
TEXAS CAPITAL BANCSHARES, INC.
SUMMARY OF LOAN LOSS EXPERIENCE
(Dollars in thousands)
2nd Quarter
2013
1st Quarter
2013
4th Quarter
2012
3rd Quarter
2012
2nd Quarter
2012
Reserve for loan losses:
Beginning balance $75,000 $74,337 $73,722 $72,404 $71,992
Loans charged-off:
Commercial 2,826 1,648 4,044 1,154 1,048
Real estate – term 26 105 284 56
Consumer 26 19 49
Leases 34 49 26
Total loans charged-off 2,878 1,772 4,078 1,536 1,130
Recoveries:
Commercial 348 397 350 132 191
Real estate – construction 10
Real estate – term 7 8 226 130 348
Consumer 15 30 7 18 3
Leases 140 121 21 16 55
Total recoveries 510 556 604 306 597
Net charge-offs 2,368 1,216 3,474 1,230 533
Provision for loan losses 6,796 1,879 4,089 2,548 945
Ending balance $79,428 $75,000 $74,337 $73,722 $72,404
Reserve for off-balance sheet credit losses:
Beginning balance $3,976 $3,855 $3,444 $2,992 $2,937
Provision for off-balance sheet credit losses 204 121 411 452 55
Ending balance $4,180 $3,976 $3,855 $3,444 $2,992
Total reserves for credit losses $83,608 $78,976 $78,192 $77,166 $75,396
Total provision for credit losses $7,000 $2,000 $4,500 $3,000 $1,000
Reserve to loans held for investment(2) 1.06% 1.08% 1.10% 1.13% 1.16%
Reserve to average loans held for investment(2) 1.11% 1.10% 1.12% 1.16% 1.22%
Net charge-offs to average loans(1)(2) .13% .07% .21% .08% .04%
Net charge-offs to average loans for last twelve months(1)(2) .12% .10% .10% .10% .20%
Total provision for credit losses to average loans(1)(2) .39% .12% .27% .19% .07%
Combined reserves for credit losses to loans held for investment(2) 1.11% 1.14% 1.15% 1.18% 1.21%
Non-performing assets (NPAs):
Non-accrual loans $38,450 $43,424 $55,833 $57,275 $56,433
Other real estate owned (OREO) (4) 13,053 14,426 15,991 19,079 27,882
Total $51,503 $57,850 $71,824 $76,354 $84,315
Non-accrual loans to loans(2) .51% .63% .82% .87% .91%
Total NPAs to loans plus OREO(2) .68% .83% 1.06% 1.16% 1.35%
Total NPAs to earning assets .49% .60% .71% .81% .97%
Reserve for loan losses to non-accrual loans 2.1x 1.7x 1.3x 1.3x 1.3x
Restructured loans $4,765 $11,755 $10,407 $9,145 $13,943
Loans past due 90 days and still accruing(3) $7,633 $12,614 $3,674 $3,622 $4,421
Loans past due 90 days to loans(2) .10% .18% .05% .06% .07%
(1) Interim period ratios are annualized.
(2) Excludes loans held for sale.
(3) At June 30, 2013, loans past due 90 days and still accruing includes premium finance loans of $4.2 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.
(4) At June 30, 2013, OREO balance is net of $4.6 million valuation allowance.
TEXAS CAPITAL BANCSHARES, INC.
CONSOLIDATED STATEMENT OF INCOME (UNAUDITED)
(Dollars in thousands)
2nd Quarter
2013
1st Quarter
2013
4th Quarter
2012
3rd Quarter
2012
2nd Quarter
2012
Interest income
Interest and fees on loans $106,418 $103,182 $106,653 $100,830 $94,291
Securities 773 939 1,053 1,125 1,203
Federal funds sold 13 6 6 2 4
Deposits in other banks 60 52 57 54 48
Total interest income 107,264 104,179 107,769 102,011 95,546
Interest expense
Deposits 3,228 3,245 3,312 3,378 3,482
Federal funds purchased 206 212 190 268 240
Repurchase agreements 5 4 3 3 4
Other borrowings 143 213 615 607 492
Subordinated notes 1,829 1,829 1,829 208
Trust preferred subordinated debentures 633 634 665 692 688
Total interest expense 6,044 6,137 6,614 5,156 4,906
Net interest income 101,220 98,042 101,155 96,855 90,640
Provision for credit losses 7,000 2,000 4,500 3,000 1,000
Net interest income after provision for credit losses 94,220 96,042 96,655 93,855 89,640
Non-interest income
Service charges on deposit accounts 1,749 1,701 1,693 1,684 1,624
Trust fee income 1,269 1,241 1,260 1,216 1,232
Bank owned life insurance (BOLI) income 463 498 510 549 588
Brokered loan fees 4,778 4,744 4,978 4,839 4,128
Swap fees 981 1,652 2,093 1,397 622
Other 1,888 1,445 2,302 867 2,268
Total non-interest income 11,128 11,281 12,836 10,552 10,462
Non-interest expense
Salaries and employee benefits 45,191 33,541 31,198 31,009 30,230
Net occupancy expense 4,135 3,857 3,916 3,653 3,679
Marketing 4,074 3,972 3,980 3,472 3,174
Legal and professional 4,707 3,940 5,320 4,916 3,330
Communications and technology 3,347 3,122 3,070 2,885 2,720
Allowance and other carrying costs for OREO 482 430 1,369 552 3,812
Litigation settlement expense 4,000
Other 6,798 6,838 7,221 7,034 7,028
Total non-interest expense 68,734 55,700 60,074 53,521 53,973
Income from continuing operations before income taxes 36,614 51,623 49,417 50,886 46,129
Income tax expense 12,542 18,479 17,982 18,316 16,506
Income from continuing operations 24,072 33,144 31,435 32,570 29,623
Income (loss) from discontinued operations (after-tax) 1 (1) (6) (34) (1)
Net income 24,073 33,143 31,429 32,536 29,622
Preferred stock dividends 2,438 81
Net income available to common shareholders $21,635 $33,062 $31,429 $32,536 $29,622
TEXAS CAPITAL BANCSHARES, INC.
QUARTERLY FINANCIAL SUMMARY – UNAUDITED
Consolidated Daily Average Balances, Average Yields and Rates
Continuing Operations
(Dollars in thousands)
2nd Quarter 2013 1st Quarter 2013 4th Quarter 2012 3rd Quarter 2012 2nd Quarter 2012
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 $60,063 $594 3.97% $71,220 $729 4.15% $78,182 $811 4.13% $84,583 $881 4.14% $91,623 $948 4.16%
Securities – Non-taxable(2) 18,843 275 5.85% 22,174 323 5.91% 25,301 372 5.85% 25,717 376 5.82% 26,817 393 5.89%
Federal funds sold and securities purchased under resale agreements 54,448 13 0.10% 24,785 6 0.10% 21,617 6 0.11% 9,360 2 0.09% 8,077 4 0.20%
Deposits in other banks 91,177 60 0.26% 78,718 52 0.27% 69,886 57 0.32% 64,859 54 0.33% 60,416 48 0.32%
Loans held for sale 2,406,246 22,440 3.74% 2,362,646 22,641 3.89% 2,658,092 26,440 3.96% 2,432,027 24,433 4.00% 2,062,449 21,087 4.11%
Loans held for investment 7,152,323 83,978 4.71% 6,842,766 80,541 4.77% 6,662,817 80,213 4.79% 6,313,263 76,397 4.81% 5,950,913 73,204 4.95%
Less reserve for loan losses 75,006 74,442 73,912 72,373 71,779
Loans, net of reserve 9,483,563 106,418 4.50% 9,130,970 103,182 4.58% 9,246,997 106,653 4.59% 8,672,917 100,830 4.63% 7,941,583 94,291 4.78%
Total earning assets 9,708,094 107,360 4.44% 9,327,867 104,292 4.53% 9,441,983 107,899 4.55% 8,857,436 102,143 4.59% 8,128,516 95,684 4.73%
Cash and other assets 402,898 401,692 427,299 399,428 394,086
Total assets $10,110,992 $9,729,559 $9,869,282 $9,256,864 $8,522,602
Liabilities and Stockholders' Equity
Transaction deposits $1,051,199 $233 0.09% $1,003,735 $253 0.10% $941,947 $244 0.10% $803,776 $247 0.12% $694,463 $198 0.11%
Savings deposits 3,340,420 2,292 0.28% 3,246,675 2,297 0.29% 2,933,904 2,299 0.31% 2,922,852 2,185 0.30% 2,664,598 2,107 0.32%
Time deposits 397,868 407 0.41% 403,113 414 0.42% 423,685 448 0.42% 491,783 576 0.47% 584,581 831 0.57%
Deposits in foreign branches 340,713 296 0.35% 335,265 281 0.34% 362,580 321 0.35% 431,412 370 0.34% 444,478 346 0.31%
Total interest bearing deposits 5,130,200 3,228 0.25% 4,988,788 3,245 0.26% 4,662,116 3,312 0.28% 4,649,823 3,378 0.29% 4,388,120 3,482 0.32%
Other borrowings 727,158 354 0.20% 1,041,573 429 0.17% 1,725,129 808 0.19% 1,639,953 878 0.21% 1,428,575 736 0.21%
Subordinated notes 111,000 1,829 6.61% 111,000 1,829 6.68% 111,000 1,829 6.56% 12,065 208 6.86%
Trust preferred subordinated debentures 113,406 633 2.24% 113,406 634 2.27% 113,406 665 2.33% 113,406 692 2.43% 113,406 688 2.44%
Total interest bearing liabilities 6,081,764 6,044 0.40% 6,254,767 6,137 0.40% 6,611,651 6,614 0.40% 6,415,247 5,156 0.32% 5,930,101 4,906 0.33%
Demand deposits 2,914,341 2,529,927 2,356,758 2,010,694 1,864,456
Other liabilities 91,608 90,538 86,308 80,810 69,076
Stockholders' equity 1,023,279 854,327 814,565 750,113 658,969
Total liabilities and stockholders' equity $10,110,992 $9,729,559 $9,869,282 $9,256,864 $8,522,602
Net interest income $101,316 $98,155 $101,285 $96,987 $90,778
Net interest margin 4.19% 4.27% 4.27% 4.36% 4.49%
(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.

CONTACT: MEDIA CONTACT Heather Worley, 214.932.6827 heather.worley@texascapitalbank.com INVESTOR CONTACT Myrna Vance, 214.932.6646 myrna.vance@texascapitalbank.com

Source:Texas Capital Bancshares, Inc.