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Texas Capital Bancshares, Inc. Announces Operating Results for Q2 2015

20:00 EDT 21 Jul 2015 | Globe Newswire

DALLAS, July 22, 2015 (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 2015.

“Our continued strong performance in 2015 is highlighted with outstanding loan and deposit growth and related earnings," said Keith Cargill, CEO. "For 2015 we have experienced solid growth and market share movement in core loans held for investment and a continued benefit from growth and refinancing activity in our mortgage finance business. We are pleased to announce our new Mortgage Correspondent Aggregation ("MCA") business, which we believe will successfully complement our mortgage finance business. This logical extension of our industry-leading service to current and prospective clients is expected to be highly profitable and capital efficient.”

  • Loans held for investment, excluding mortgage finance, increased 3% and total loans decreased 1% on a linked quarter basis, growing 22% and 25%, respectively, from the second quarter of 2014.
  • Mortgage finance loans decreased 9% on a linked quarter basis and increased 33% from the second quarter of 2014.
  • Demand deposits increased 7% and total deposits remained flat on a linked quarter basis, growing 55% and 32%, respectively, from the second quarter of 2014.
  • Net income increased 8% on a linked quarter basis and increased 14% from the second quarter of 2014.
  • EPS increased 9% on a linked quarter basis, and increased 7% from the second quarter of 2014.

FINANCIAL SUMMARY
(dollars and shares in thousands)

  Q2 2015 Q2 2014 % Change
QUARTERLY OPERATING RESULTS     
Net income$37,937  $33,421  14%
Net income available to common stockholders$35,500  $30,984  15%
Diluted EPS$0.76  $0.71  7%
ROA0.83% 1.08%  
ROE10.32% 11.38%  
Diluted shares46,443  43,845   
      
BALANCE SHEET     
Total assets$17,817,338  $13,534,352  32%
Demand deposits6,479,073  4,181,774  55%
Total deposits14,188,276  10,757,316  32%
Loans held for investment11,123,325  9,153,005  22%
Loans held for investment, mortgage finance4,906,415  3,700,253  33%
Total loans16,029,740  12,853,258  25%
Stockholders’ equity1,554,529  1,262,816  23%


DETAILED FINANCIALS

Texas Capital Bancshares, Inc. reported net income of $37.9 million and net income available to common stockholders of $35.5 million for the quarter ended June 30, 2015 compared to net income of $33.4 million and net income available to common stockholders of $31.0 million for the same period in 2014. On a fully diluted basis, earnings per common share were $.76 for the quarter ended June 30, 2015 compared to $.71 for the same period of 2014.

Return on average common equity (“ROE”) was 10.32 percent and return on average assets (“ROA”) was .83 percent for the second quarter of 2015, compared to 11.38 percent and 1.08 percent, respectively, for the second quarter of 2014. The ROE decrease resulted from the 23 percent year-over-year increase in average common equity, reflecting the impact of the common stock offering completed in the fourth quarter of 2014. The ROA decrease resulted from a combination of reduced yields on loans and a $2.1 billion increase in average liquidity assets, which include Federal funds sold and deposits in other banks, from the second quarter of 2014 to the second quarter of 2015.

Net interest income was $142.3 million for the second quarter of 2015, compared to $115.4 million for the second quarter of 2014 and $130.0 million for the first quarter of 2015. The net interest margin for the second quarter of 2015 was 3.22 percent, a 65 basis point decrease from the second quarter of 2014 and consistent with 3.22 percent the first quarter of 2015. The year-over-year decrease in net interest margin is due primarily to a substantial increase in liquidity assets, as well as the growth in loans with lower average yields. The cost of total deposits and borrowed funds was 16 basis points for the second quarter of 2015, compared to 17 basis points for the second quarter of 2014.

Average loans, excluding mortgage finance loans, for the second quarter of 2015 were $10.9 billion, an increase of $2.0 billion, or 22 percent, from the second quarter of 2014, and an increase of $438.9 million, or 4 percent, from the first quarter of 2015. Average mortgage finance loans for the second quarter of 2015 were $4.6 billion, an increase of $1.8 billion, or 62 percent, from the second quarter of 2014 and an increase of $826.5 million, or 22 percent, from the first quarter of 2015.

Average total deposits for the second quarter of 2015 increased $4.6 billion from the second quarter of 2014 and increased $945.4 million from the first quarter of 2015. Average demand deposits for the second quarter of 2015 increased $3.2 billion, or 87 percent, to $6.8 billion from $3.6 billion during the second quarter of 2014 and increased $1.2 billion, or 22 percent, from the first quarter of 2015.

We recorded a $14.5 million provision for credit losses in the second quarter of 2015 compared to $4.0 million in the second quarter of 2014 and $11.0 million in the first quarter of 2015. The provision for the second quarter of 2015 was driven by the application of our methodology. The increase was primarily related to the growth in traditional loans held for investment, excluding mortgage finance loans, as well as 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 loan portfolio. The combined reserve at June 30, 2015 increased to 1.14 percent of loans excluding mortgage finance loans due to continuing loan growth, as compared to 1.06 percent at June 30, 2014 and 1.08 percent at March 31, 2015. 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. We experienced an increase in non-performing asset totals in the second quarter of 2015, bringing the ratio of total non-performing assets to total loans plus other real estate owned (“OREO”) to .77 percent compared to .33 percent in the second quarter of 2014 and .43 percent in the first quarter of 2015. Net charge-offs for the second quarter of 2015 were $3.7 million compared to net charge-offs of $2.5 million in the second quarter of 2014 and net charge-offs of $3.1 million in the first quarter of 2015. For the second quarter of 2015, net charge-offs were .10 percent of total loans, compared to .08 percent for the same period in 2014. At June 30, 2015, non-performing assets included OREO of $609,000 compared to $685,000 as of June 30, 2014.

Non-interest income increased $2.2 million, or 21 percent, during the second quarter of 2015 compared to the same period of 2014. Brokered loan fees, swap fees and service charges increased $1.9 million, $625,000 and $385,000, respectively, during the second quarter of 2015 compared to the same period of 2014. The increase in brokered loan fees was a result of an increase in mortgage finance volumes. Swap fees fluctuate from quarter to quarter based on the number and volume of transactions closed during the quarter. Offsetting these increases was a $692,000 decrease in other non-interest income during the second quarter of 2015 compared to the same period of 2014.

Non-interest expense for the second quarter of 2015 increased $11.5 million, or 16 percent, to $81.3 million from $69.8 million in the second quarter of 2014. The increase is primarily related to an $8.3 million increase in salaries and employee benefits expense, a $1.3 million increase in communications and technology expense, a $957,000 increase in other non-interest expense, a $735,000 increase in net occupancy expense, and a $130,000 increase in marketing expense, all of which were due to general business growth. FDIC insurance assessment expense for the second quarter of 2015 increased $1.7 million compared to the same quarter in 2014 as a result of the increase in total assets from June 30, 2014 to June 30, 2015. Partially offsetting these increases was a $1.6 million decrease in legal and professional expense during the second quarter of 2015.

Stockholders’ equity increased by 23 percent from $1.3 billion at June 30, 2014 to $1.6 billion at June 30, 2015, primarily due to the offering of 2.5 million common shares for net proceeds of $149.6 million in the fourth quarter of 2014 and retention of net income. Texas Capital Bank is well capitalized under regulatory guidelines and at June 30, 2015, our ratio of tangible common equity to total tangible assets was 7.8 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. 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. 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, deterioration of the credit quality of our loan portfolio, the effects of recent declines in oil and gas prices on our customers, increased defaults and loan losses, 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 our Annual Report on Form 10-K and in other filings we make with the Securities and Exchange Commission.

TEXAS CAPITAL BANCSHARES, INC.
SELECTED FINANCIAL HIGHLIGHTS (UNAUDITED)
(Dollars in thousands except per share data)
 2nd Quarter1st Quarter4th Quarter3rd Quarter2nd Quarter
 20152015201420142014
CONSOLIDATED STATEMENTS OF INCOME     
Interest income$153,374 $140,908 $137,833 $135,290 $124,813 
Interest expense11,089 10,899 10,251 9,629 9,406 
Net interest income142,285 130,009 127,582 125,661 115,407 
Provision for credit losses14,500 11,000 6,500 6,500 4,000 
Net interest income after provision for credit losses127,785 119,009 121,082 119,161 111,407 
Non-interest income12,771 12,267 11,226 10,396 10,533 
Non-interest expense81,276 76,517 74,117 71,915 69,765 
Income before income taxes59,280 54,759 58,191 57,642 52,175 
Income tax expense21,343 19,709 20,357 20,810 18,754 
Net income37,937 35,050 37,834 36,832 33,421 
Preferred stock dividends2,437 2,438 2,437 2,438 2,437 
Net income available to common stockholders$35,500 $32,612 $35,397 $34,394 $30,984 
      
Diluted EPS$.76 $.70 $.78 $.78 $.71 
Diluted shares46,443,413 46,367,870 45,092,511 43,849,838 43,845,015 
      
CONSOLIDATED BALANCE SHEET DATA     
Total assets$17,817,338 $17,325,458 $15,899,946 $14,268,561 $13,534,352 
Loans held for investment11,123,325 10,760,978 10,154,887 9,686,422 9,153,005 
Loans held for investment, mortgage finance4,906,415 5,408,750 4,102,125 3,774,467 3,700,253 
Securities35,361 37,649 41,719 43,938 49,330 
Demand deposits6,479,073 6,050,817 5,011,619 4,722,479 4,181,774 
Total deposits14,188,276 14,122,306 12,673,300 11,715,808 10,757,316 
Other borrowings1,509,007 1,125,458 1,192,681 735,689 1,000,548 
Subordinated notes286,000 286,000 286,000 286,000 286,000 
Long-term debt113,406 113,406 113,406 113,406 113,406 
Stockholders’ equity1,554,529 1,517,958 1,484,190 1,297,922 1,262,816 
      
End of period shares outstanding45,812,971 45,772,245 45,735,007 43,179,134 43,105,444 
Book value$30.66 $29.89 $29.14 $26.59 $25.82 
Tangible book value(1)$30.22 $29.44 $28.69 $26.10 $25.33 
      
SELECTED FINANCIAL RATIOS     
Net interest margin3.22%3.22%3.56%3.77%3.87%
Return on average assets0.83%0.84%1.03%1.07%1.08%
Return on average common equity10.32%9.82%11.41%12.11%11.38%
Non-interest income to earning assets0.29%0.30%0.31%0.31%0.35%
Efficiency ratio(2)52.4%53.8%53.4%52.9%55.4%
Non-interest expense to earning assets1.84%1.89%2.07%2.16%2.34%
Tangible common equity to total tangible assets(3)7.8%7.8%8.3%7.9%8.1%

(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 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)
 June 30,
2015
June 30,
2014
%
Change
Assets   
Cash and due from banks$117,387 $116,525 1%
Interest-bearing deposits1,321,064 240,617 449%
Federal funds sold and securities purchased under resale agreements16,300  100%
Securities, available-for-sale35,361 49,330 (28)%
Loans held for investment, mortgage finance4,906,415 3,700,253 33%
Loans held for investment (net of unearned income)11,123,325 9,153,005 22%
Less:  Allowance for loan losses118,770 91,114 30%
Loans held for investment, net15,910,970 12,762,144 25%
Premises and equipment, net17,951 15,762 14%
Accrued interest receivable and other assets378,068 329,036 15%
Goodwill and intangibles, net20,237 20,938 (3)%
Total assets$17,817,338 $13,534,352 32%
    
Liabilities and Stockholders’ Equity   
Liabilities:   
Deposits:   
Non-interest bearing$6,479,073 $4,181,774 55%
Interest bearing7,502,937 6,233,357 20%
Interest bearing in foreign branches206,266 342,185 (40)%
Total deposits14,188,276 10,757,316 32%
    
Accrued interest payable4,905 4,671 5%
Other liabilities161,215 109,595 47%
Federal funds purchased and repurchase agreements109,007 300,532 (64)%
Other borrowings1,400,000 700,016 100%
Subordinated notes286,000 286,000  
Trust preferred subordinated debentures113,406 113,406  
Total liabilities16,262,809 12,271,536 33%
    
Stockholders’ equity:   
Preferred stock, $.01 par value, $1,000 liquidation value:   
Authorized shares - 10,000,000   
Issued shares - 6,000,000 shares issued at June 30, 2015 and 2014150,000 150,000 
Common stock, $.01 par value:   
Authorized shares - 100,000,000   
Issued shares - 45,813,388 and 43,105,861 at June 30, 2015 and 2014, respectively458 431 6%
Additional paid-in capital712,222 557,919 28%
Retained earnings690,826 552,923 25%
Treasury stock (shares at cost: 417 at June 30, 2015 and 2014)(8)(8) 
Accumulated other comprehensive income, net of taxes1,031 1,551 (34)%
Total stockholders’ equity1,554,529 1,262,816 23%
Total liabilities and stockholders’ equity$17,817,338 $13,534,352 32%


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
 2015201420152014
Interest income    
Interest and fees on loans$151,606 $124,234 $290,780 $240,106 
Securities323 471 681 1,011 
Federal funds sold118 8 234 48 
Deposits in other banks1,327 100 2,587 259 
Total interest income153,374 124,813 294,282 241,424 
Interest expense    
Deposits5,642 4,246 11,270 8,276 
Federal funds purchased93 115 161 210 
Repurchase agreements4 4 8 8 
Other borrowings528 181 918 253 
Subordinated notes4,191 4,241 8,382 7,720 
Trust preferred subordinated debentures631 619 1,249 1,235 
Total interest expense11,089 9,406 21,988 17,702 
Net interest income142,285 115,407 272,294 223,722 
Provision for credit losses14,500 4,000 25,500 9,000 
Net interest income after provision for credit losses127,785 111,407 246,794 214,722 
Non-interest income    
Service charges on deposit accounts2,149 1,764 4,243 3,460 
Trust fee income1,287 1,242 2,487 2,524 
Bank owned life insurance (BOLI) income476 521 960 1,030 
Brokered loan fees5,277 3,357 9,509 6,181 
Swap fees1,035 410 3,021 1,634 
Other2,547 3,239 4,818 6,060 
Total non-interest income12,771 10,533 25,038 20,889 
Non-interest expense    
Salaries and employee benefits48,200 39,896 94,028 81,952 
Net occupancy expense5,808 5,073 11,499 9,841 
Marketing3,925 3,795 8,143 7,554 
Legal and professional5,618 7,181 9,666 12,583 
Communications and technology5,647 4,361 10,725 8,285 
FDIC insurance assessment4,211 2,544 8,001 5,269 
Allowance and other carrying costs for OREO6 11 15 56 
Other7,861 6,904 15,716 13,542 
Total non-interest expense81,276 69,765 157,793 139,082 
Income before income taxes59,280 52,175 114,039 96,529 
Income tax expense21,343 18,754 41,052 34,843 
Net income37,937 33,421 72,987 61,686 
Preferred stock dividends2,437 2,437 4,875 4,875 
Net income available to common stockholders$35,500 $30,984 $68,112 $56,811 
     
Basic earnings per common share$0.78 $0.72 $1.49 $1.33 
Diluted earnings per common share$0.76 $0.71 $1.47 $1.30 


TEXAS CAPITAL BANCSHARES, INC.
SUMMARY OF LOAN LOSS EXPERIENCE
(Dollars in thousands)
 2nd Quarter1st Quarter4th Quarter3rd Quarter2nd Quarter
 20152015201420142014
Reserve for loan losses:     
Beginning balance$108,078 $100,954 $96,322 $91,114 $90,234 
Loans charged-off:     
Commercial5,418 3,102 1,285 992 5,190 
Real estate 346   246 
Consumer 62 165  40 
Total loans charged-off5,418 3,510 1,450 992 5,476 
Recoveries:     
Commercial1,424 286 190 329 2,033 
Real estate12 8 34 2 35 
Construction272 83    
Consumer6 4 96 35 6 
Leases15 8 2 31 925 
Total recoveries1,729 389 322 397 2,999 
Net charge-offs3,689 3,121 1,128 595 2,477 
Provision for loan losses14,381 10,245 5,760 5,803 3,357 
Ending balance$118,770 $108,078 $100,954 $96,322 $91,114 
      
Reserve for off-balance sheet credit losses:     
Beginning balance$7,815 $7,060 $6,320 $5,623 $4,980 
Provision for off-balance sheet credit losses119 755 740 697 643 
Ending balance$7,934 $7,815 $7,060 $6,320 $5,623 
      
Total reserves for credit losses$126,704 $115,893 $108,014 $102,642 $96,737 
      
Total provision for credit losses$14,500 $11,000 $6,500 $6,500 $4,000 
      
Reserve to loans0.74%0.67%0.71%0.72%0.71%
Reserve to loans excluding mortgage finance loans(2)1.07%1.00%0.99%0.99%1.00%
Reserve to average loans0.77%0.76%0.75%0.75%0.77%
Reserve to average loans excluding mortgage finance loans(2)1.09%1.03%1.02%1.02%1.01%
Net charge-offs to average loans(1)0.10%0.09%0.03%0.02%0.08%
Net charge-offs to average loans excluding mortgage finance loans(1)(2)0.14%0.12%0.05%0.03%0.11%
Net charge-offs to average loans for last twelve months(1)0.06%0.06%0.05%0.05%0.06%
Net charge-offs to average loans, excluding mortgage finance loans, for last twelve months(1)(2)0.08%0.08%0.07%0.07%0.07%
Total provision for credit losses to average loans(1)0.37%0.31%0.19%0.20%0.14%
Total provision for credit losses to average loans excluding mortgage finance loans(1)(2)0.53%0.42%0.26%0.27%0.18%
Combined reserves for credit losses to loans0.79%0.72%0.76%0.76%0.75%
Combined reserves for credit losses to loans, excluding mortgage finance loans(2)1.14%1.08%1.06%1.06%1.06%
      
Non-performing assets (NPAs):     
Non-accrual loans$122,920 $68,307 $43,304 $37,733 $41,565 
Other real estate owned (OREO)609 605 568 617 685 
Total$123,529 $68,912 $43,872 $38,350 $42,250 
      


 2nd Quarter1st Quarter4th Quarter3rd Quarter2nd Quarter
 20152015201420142014
      
Non-accrual loans to loans0.77%0.42%0.30%0.28%0.32%
Non-accrual loans to loans excluding mortgage finance loans(2)1.11%0.63%0.43%0.39%0.45%
Total NPAs to loans plus OREO0.77%0.43%0.31%0.28%0.33%
Total NPAs to loans excluding mortgage finance loans plus OREO(2)1.11%0.64%0.43%0.40%0.46%
Total NPAs to earning assets0.72%0.41%0.28%0.28%0.32%
Reserve for loan losses to non-accrual loans1.0x1.6x2.3x2.6x2.2x
      
Restructured loans$249 $319 $1,806 $1,853 $249 
Loans past due 90 days and still accruing(3)$5,482 $2,971 $5,274 $6,102 $4,793 
      
Loans past due 90 days to loans0.03%0.02%0.04%0.05%0.04%
Loans past due 90 days to loans excluding mortgage finance loans(2)0.05%0.03%0.05%0.06%0.05%

(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 June 30, 2015, loans past due 90 days and still accruing includes premium finance loans of $4.8 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)
      
 2nd Quarter1st Quarter4th Quarter3rd Quarter2nd Quarter
 20152015201420142014
Interest income     
Interest and fees on loans$151,606 $139,174 $136,882 $134,618 $124,234 
Securities323 358 389 428 471 
Federal funds sold118 116 91 68 8 
Deposits in other banks1,327 1,260 471 176 100 
Total interest income153,374 140,908 137,833 135,290 124,813 
Interest expense     
Deposits5,642 5,628 5,263 4,606 4,246 
Federal funds purchased93 68 81 82 115 
Repurchase agreements4 4 4 5 4 
Other borrowings528 390 35 68 181 
Subordinated notes4,191 4,191 4,241 4,241 4,241 
Trust preferred subordinated debentures631 618 627 627 619 
Total interest expense11,089 10,899 10,251 9,629 9,406 
Net interest income142,285 130,009 127,582 125,661 115,407 
Provision for credit losses14,500 11,000 6,500 6,500 4,000 
Net interest income after provision for credit losses127,785 119,009 121,082 119,161 111,407 
Non-interest income     
Service charges on deposit accounts2,149 2,094 1,976 1,817 1,764 
Trust fee income1,287 1,200 1,223 1,190 1,242 
Bank owned life insurance (BOLI) income476 484 520 517 521 
Brokered loan fees5,277 4,232 3,979 3,821 3,357 
Swap fees1,035 1,986 894 464 410 
Other2,547 2,271 2,634 2,587 3,239 
Total non-interest income12,771 12,267 11,226 10,396 10,533 
Non-interest expense     
Salaries and employee benefits48,200 45,828 43,910 43,189 39,896 
Net occupancy expense5,808 5,691 5,746 5,279 5,073 
Marketing3,925 4,218 4,411 4,024 3,795 
Legal and professional5,618 4,048 3,725 4,874 7,181 
Communications and technology5,647 5,078 5,454 4,928 4,361 
FDIC insurance assessment4,211 3,790 2,875 2,775 2,544 
Allowance and other carrying costs for OREO6 9 24 5 11 
Other7,861 7,855 7,972 6,841 6,904 
Total non-interest expense81,276 76,517 74,117 71,915 69,765 
Income before income taxes59,280 54,759 58,191 57,642 52,175 
Income tax expense21,343 19,709 20,357 20,810 18,754 
Net income37,937 35,050 37,834 36,832 33,421 
Preferred stock dividends2,437 2,438 2,437 2,438 2,437 
Net income available to common shareholders$35,500 $32,612 $35,397 $34,394 $30,984 


TEXAS CAPITAL BANCSHARES, INC.
QUARTERLY FINANCIAL SUMMARY - UNAUDITED
Consolidated Daily Average Balances, Average Yields and Rates
Continuing Operations
(Dollars in thousands)
 2nd Quarter 2015 1st Quarter 2015 4th Quarter 2014 3rd Quarter 2014 2nd Quarter 2014
 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$35,081 $311 3.56% $37,145 $332 3.62% $39,258 $355 3.59% $41,716 $383 3.64% $44,216 $410 3.72%
Securities - Non-taxable(2)1,427 18 5.06% 2,785 40 5.82% 3,257 52 6.33% 4,697 69 5.83% 6,271 94 6.01%
Federal funds sold and securities purchased under resale agreements200,690 118 0.24% 191,297 116 0.25% 139,761 91 0.26% 105,793 68 0.26% 14,997 8 0.21%
Deposits in other banks2,103,732 1,327 0.25% 2,019,567 1,260 0.25% 742,240 471 0.25% 283,062 176 0.25% 183,061 100 0.22%
Loans held for investment, mortgage finance loans4,573,478 33,773 2.96% 3,746,938 27,631 2.99% 3,471,737 26,773 3.06% 3,452,782 27,275 3.13% 2,822,560 23,231 3.30%
Loans held for investment10,941,029 117,833 4.32% 10,502,172 111,543 4.31% 9,921,611 110,109 4.40% 9,423,548 107,343 4.52% 8,984,521 101,003 4.51%
Less reserve for loan
  losses
109,086    101,042    96,139    91,427    90,105   
Loans, net of reserve15,405,421 151,606 3.95% 14,148,068 139,174 3.99% 13,297,209 136,882 4.08% 12,784,903 134,618 4.18% 11,716,976 124,234 4.25%
Total earning assets17,746,351 153,380 3.47% 16,398,862 140,922 3.49% 14,221,725 137,851 3.85% 13,220,171 135,314 4.06% 11,965,521 124,846 4.18%
Cash and other assets493,034    459,030    409,635    409,727    396,938   
Total assets$18,239,385    $16,857,892    $14,631,360    $13,629,898    $12,362,459   
                    
Liabilities and Stockholders’ Equity                   
Transaction deposits$1,404,521 $458 0.13% $1,401,626 $444 0.13% $1,150,530 $401 0.14% $1,010,003 $287 0.11% $895,827 $170 0.08%
Savings deposits5,610,277 4,332 0.31% 5,891,344 4,420 0.30% 5,479,395 4,121 0.30% 4,991,779 3,519 0.28% 4,679,140 3,395 0.29%
Time deposits516,582 657 0.51% 447,681 506 0.46% 406,040 413 0.40% 485,558 475 0.39% 401,024 390 0.39%
Deposits in foreign branches246,035 195 0.32% 304,225 258 0.34% 369,471 328 0.35% 369,202 325 0.35% 350,043 291 0.33%
Total interest bearing deposits7,777,415 5,642 0.29% 8,044,876 5,628 0.28% 7,405,436 5,263 0.28% 6,856,542 4,606 0.27% 6,326,034 4,246 0.27%
Other borrowings1,565,874 625 0.16% 1,172,675 462 0.16% 251,737 120 0.19% 310,157 155 0.20% 666,696 300 0.18%
Subordinated notes286,000 4,191 5.88% 286,000 4,191 5.94% 286,000 4,241 5.88% 286,000 4,241 5.88% 286,000 4,241 5.95%
Trust preferred subordinated debentures113,406 631 2.23% 113,406 618 2.21% 113,406 627 2.19% 113,406 627 2.19% 113,406 619 2.19%
Total interest bearing liabilities9,742,695 11,089 0.46% 9,616,957 10,899 0.46% 8,056,579 10,251 0.50% 7,566,105 9,629 0.50% 7,392,136 9,406 0.51%
Demand deposits6,804,994    5,592,124    5,047,876    4,669,772    3,629,941   
Other liabilities161,614    152,639    146,259    117,418    98,595   
Stockholders’ equity1,530,082    1,496,172    1,380,646    1,276,603    1,241,787   
Total liabilities and stockholders’ equity$18,239,385    $16,857,892    $14,631,360    $13,629,898    $12,362,459   
                    
Net interest income(2) $142,291    $130,023    $127,600    $125,685    $115,440  
Net interest margin  3.22%   3.22%   3.56%   3.77%   3.87%

(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

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