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Texas Capital Bancshares, Inc. Announces First Quarter 2024 Results
المصدر: Nasdaq GlobeNewswire / 18 أبريل 2024 06:00:01 America/New_York
First quarter 2024 net income of $26.1 million and net income available to common stockholders of $21.8 million,
or $0.46 per diluted shareFirst quarter 2024 growth in loans held for investment of 2.4% and in total deposits of 7.1%
Capital ratios continue to be strong, including 12.4% CET1 and 16.6% Total Capital
DALLAS, April 18, 2024 (GLOBE NEWSWIRE) -- Texas Capital Bancshares, Inc. (NASDAQ: TCBI), the parent company of Texas Capital Bank, announced operating results for the first quarter of 2024.
Net income available to common stockholders was $21.8 million, or $0.46 per diluted share, for the first quarter of 2024, compared to $15.8 million, or $0.33 per diluted share, for the fourth quarter of 2023 and $34.3 million, or $0.70 per diluted share, for the first quarter of 2023. The first quarter of 2024 included a $5.0 million ($0.08 per diluted share) legal settlement expense, Federal Deposit Insurance Corporation (“FDIC”) special assessment expense of $3.0 million ($0.05 per diluted share) and $2.0 million ($0.03 per diluted share) of restructuring expenses.
“We continue to leverage our unique balance sheet positioning and maturing product capabilities to build an enduring and valuable franchise,” said Rob C. Holmes, President and CEO. “Quality quarterly growth in areas of focus coupled with strong firm-wide pipelines signal emerging momentum moving into the second quarter.”
FINANCIAL RESULTS (dollars and shares in thousands) 1st Quarter 4th Quarter 1st Quarter 2024 2023 2023 OPERATING RESULTS Net income $ 26,142 $ 20,150 $ 38,661 Net income available to common stockholders $ 21,829 $ 15,838 $ 34,348 Diluted earnings per common share $ 0.46 $ 0.33 $ 0.70 Diluted common shares 47,711 48,098 48,881 Return on average assets 0.36 % 0.27 % 0.53 % Return on average common equity 3.03 % 2.25 % 5.06 % BALANCE SHEET Loans held for investment $ 16,677,691 $ 16,362,230 $ 16,014,497 Loans held for investment, mortgage finance 4,153,313 3,978,328 4,060,570 Total loans held for investment 20,831,004 20,340,558 20,075,067 Loans held for sale 37,750 44,105 27,608 Total assets 29,180,585 28,356,266 28,596,653 Non-interest bearing deposits 8,478,215 7,328,276 9,500,583 Total deposits 23,954,037 22,371,839 22,179,697 Stockholders’ equity 3,170,662 3,199,142 3,079,974
FIRST QUARTER 2024 COMPARED TO FOURTH QUARTER 2023For the first quarter of 2024, net income available to common stockholders was $21.8 million, or $0.46 per diluted share, compared to $15.8 million, or $0.33 per diluted share, for the fourth quarter of 2023.
Provision for credit losses for the first quarter of 2024 was $19.0 million, compared to $19.0 million for the fourth quarter of 2023. The $19.0 million provision for credit losses recorded in the first quarter of 2024 resulted primarily from increases in criticized and non-accrual loans, growth in loans held for investment (“LHI”) and $10.8 million in net charge-offs.
Net interest income was $215.0 million for the first quarter of 2024, compared to $214.7 million for the fourth quarter of 2023, as an increase in yields on earning assets was offset by a decrease in average earning assets. Net interest margin for the first quarter of 2024 was 3.03%, an increase of 10 basis points from the fourth quarter of 2023. LHI, excluding mortgage finance, yields increased 12 basis points from the fourth quarter of 2023 and LHI, mortgage finance yields increased 21 basis points from the fourth quarter of 2023. Total cost of deposits was 2.97% for the first quarter of 2024, a 15 basis point increase from the fourth quarter of 2023.
Non-interest income for the first quarter of 2024 increased $10.2 million, or 33%, compared to the fourth quarter of 2023, primarily due to an increase in investment banking and advisory fees, partially offset by a decrease in other non-interest income.
Non-interest expense for the first quarter of 2024 increased $1.0 million, or 1%, compared to the fourth quarter of 2023, primarily due to an increase in salaries and benefits, primarily as a result of the effect of seasonal payroll expenses that peak in the first quarter and $2.0 million of restructuring expenses, partially offset by decreases in legal and professional expense, communications and technology expense and FDIC insurance assessment. The fourth quarter of 2023 included $19.9 million in FDIC special assessment expense and the first quarter of 2024 included an additional special assessment expense of $3.0 million. Legal and professional expense in the first quarter of 2024 included a $5.0 million legal settlement expense, which was more than offset by declines in professional services.
FIRST QUARTER 2024 COMPARED TO FIRST QUARTER 2023
Net income available to common stockholders was $21.8 million, or $0.46 per diluted share, for the first quarter of 2024, compared to $34.3 million, or $0.70 per diluted share, for the first quarter of 2023.
The first quarter of 2024 included a $19.0 million provision for credit losses, reflecting increases in criticized and non-accrual loans, growth in LHI and $10.8 million in net charge-offs, compared to a $28.0 million provision for the first quarter of 2023.
Net interest income decreased to $215.0 million for the first quarter of 2024, compared to $235.3 million for the first quarter of 2023, primarily due to an increase in funding costs, partially offset by an increase in yields on average earning assets. Net interest margin decreased 30 basis points to 3.03% for the first quarter of 2024, as compared to the first quarter of 2023. LHI, excluding mortgage finance, yields increased 52 basis points compared to the first quarter of 2023 and LHI, mortgage finance yields decreased 102 basis points from the first quarter of 2023. Total cost of deposits increased 91 basis points compared to the first quarter of 2023.
Non-interest income for the first quarter of 2024 increased $3.9 million, or 10%, compared to the first quarter of 2023. The increase was primarily due to an increase in investment banking and advisory fees.
Non-interest expense for the first quarter of 2024 increased $8.4 million, or 4%, compared to the first quarter of 2023, primarily due to increases in legal and professional expense, communications and technology expense and FDIC insurance assessment resulting from an additional $3.0 million FDIC special assessment recorded in the first quarter of 2024, partially offset by a decrease in marketing expense. The increase in legal and professional expense in the first quarter of 2024 resulted from a $5.0 million legal settlement expense, partially offset by declines in professional services.
CREDIT QUALITY
Net charge-offs of $10.8 million were recorded during the first quarter of 2024, compared to net charge-offs of $13.8 million and $19.9 million during the fourth quarter of 2023 and the first quarter of 2023, respectively. Criticized loans totaled $859.5 million at March 31, 2024, compared to $738.2 million at December 31, 2023 and $561.1 million at March 31, 2023. Non-accrual LHI totaled $92.8 million at March 31, 2024, compared to $81.4 million at December 31, 2023 and $94.0 million at March 31, 2023. The ratio of non-accrual LHI to total LHI for the first quarter of 2024 was 0.45%, compared to 0.40% for the fourth quarter of 2023 and 0.47% for the first quarter of 2023. The ratio of total allowance for credit losses to total LHI was 1.46% at March 31, 2024, compared to 1.46% and 1.41% at September 30, 2023 and March 31, 2023, respectively.
REGULATORY RATIOS AND CAPITAL
All regulatory ratios continue to be in excess of “well capitalized” requirements as of March 31, 2024. Our CET1, tier 1 capital, total capital and leverage ratios were 12.4%, 13.9%, 16.6% and 12.4%, respectively, at March 31, 2024, compared to 12.6%, 14.2%, 17.1% and 12.2%, respectively, at December 31, 2023 and 12.4%, 14.0%, 16.9% and 12.0%, respectively, at March 31, 2023. At March 31, 2024, our ratio of tangible common equity to total tangible assets was 9.8%, compared to 10.2% at December 31, 2023 and 9.7% at March 31, 2023.
During the first quarter of 2024, the Company repurchased 529,338 shares of its common stock for an aggregate purchase price, including excise tax expense, of $31.5 million, at a weighted average price of $59.27 per share.
About Texas Capital Bancshares, Inc.
Texas Capital Bancshares, Inc. (NASDAQ: TCBI), a member of the Russell 2000® Index and the S&P MidCap 400®, is the holding company of Texas Capital, a full-service financial services firm that delivers customized solutions to businesses, entrepreneurs and individual customers. Founded in 1998, the firm 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 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) 1st Quarter 4th Quarter 3rd Quarter 2nd Quarter 1st Quarter 2024 2023 2023 2023 2023 CONSOLIDATED STATEMENTS OF INCOME Interest income $ 417,378 $ 417,072 $ 425,769 $ 401,916 $ 385,166 Interest expense 202,369 202,355 193,698 169,926 149,821 Net interest income 215,009 214,717 232,071 231,990 235,345 Provision for credit losses 19,000 19,000 18,000 7,000 28,000 Net interest income after provision for credit losses 196,009 195,717 214,071 224,990 207,345 Non-interest income 41,319 31,133 46,872 46,011 37,403 Non-interest expense 202,393 201,385 179,891 181,644 194,027 Income before income taxes 34,935 25,465 81,052 89,357 50,721 Income tax expense 8,793 5,315 19,373 20,706 12,060 Net income 26,142 20,150 61,679 68,651 38,661 Preferred stock dividends 4,313 4,312 4,313 4,312 4,313 Net income available to common stockholders $ 21,829 $ 15,838 $ 57,366 $ 64,339 $ 34,348 Diluted earnings per common share $ 0.46 $ 0.33 $ 1.18 $ 1.33 $ 0.70 Diluted common shares 47,711,192 48,097,517 48,528,698 48,421,276 48,880,725 CONSOLIDATED BALANCE SHEET DATA Total assets $ 29,180,585 $ 28,356,266 $ 29,628,249 $ 28,976,544 $ 28,596,653 Loans held for investment 16,677,691 16,362,230 16,183,882 16,227,203 16,014,497 Loans held for investment, mortgage finance 4,153,313 3,978,328 4,429,489 5,098,812 4,060,570 Loans held for sale 37,750 44,105 155,073 29,097 27,608 Interest bearing cash and cash equivalents 3,148,157 3,042,357 3,975,860 2,587,131 3,385,494 Investment securities 4,414,280 4,143,194 4,069,717 4,226,653 4,345,969 Non-interest bearing deposits 8,478,215 7,328,276 9,352,883 9,429,352 9,500,583 Total deposits 23,954,037 22,371,839 23,878,978 23,318,240 22,179,697 Short-term borrowings 750,000 1,500,000 1,400,000 1,350,000 2,100,000 Long-term debt 859,823 859,147 858,471 857,795 932,119 Stockholders’ equity 3,170,662 3,199,142 3,077,700 3,081,927 3,079,974 End of period shares outstanding 46,986,275 47,237,912 48,015,003 47,992,521 47,851,862 Book value per share $ 61.10 $ 61.37 $ 57.85 $ 57.97 $ 58.10 Tangible book value per share(1) $ 61.06 $ 61.34 $ 57.82 $ 57.93 $ 58.06 SELECTED FINANCIAL RATIOS Net interest margin 3.03 % 2.93 % 3.13 % 3.29 % 3.33 % Return on average assets 0.36 % 0.27 % 0.81 % 0.95 % 0.53 % Return on average common equity 3.03 % 2.25 % 8.08 % 9.17 % 5.06 % Non-interest income to average earning assets 0.59 % 0.43 % 0.64 % 0.66 % 0.54 % Efficiency ratio(2) 79.0 % 81.9 % 64.5 % 65.3 % 71.1 % Non-interest expense to average earning assets 2.89 % 2.79 % 2.46 % 2.61 % 2.78 % Common equity to total assets 9.8 % 10.2 % 9.4 % 9.6 % 9.7 % Tangible common equity to total tangible assets(3) 9.8 % 10.2 % 9.4 % 9.6 % 9.7 % Common Equity Tier 1 12.4 % 12.6 % 12.7 % 12.2 % 12.4 % Tier 1 capital 13.9 % 14.2 % 14.3 % 13.7 % 14.0 % Total capital 16.6 % 17.1 % 17.1 % 16.4 % 16.9 % Leverage 12.4 % 12.2 % 12.1 % 12.4 % 12.0 % (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) March 31, 2024 March 31, 2023 % Change Assets Cash and due from banks $ 167,985 $ 264,211 (36) % Interest bearing cash and cash equivalents 3,148,157 3,385,494 (7) % Available-for-sale debt securities 3,491,510 3,394,293 3 % Held-to-maturity debt securities 849,283 918,962 (8) % Equity securities 73,487 32,714 125 % Investment securities 4,414,280 4,345,969 2 % Loans held for sale 37,750 27,608 37 % Loans held for investment, mortgage finance 4,153,313 4,060,570 2 % Loans held for investment 16,677,691 16,014,497 4 % Less: Allowance for credit losses on loans 263,962 260,928 1 % Loans held for investment, net 20,567,042 19,814,139 4 % Premises and equipment, net 49,899 25,268 97 % Accrued interest receivable and other assets 793,976 732,468 8 % Goodwill and intangibles, net 1,496 1,496 — % Total assets $ 29,180,585 $ 28,596,653 2 % Liabilities and Stockholders’ Equity Liabilities: Non-interest bearing deposits $ 8,478,215 $ 9,500,583 (11) % Interest bearing deposits 15,475,822 12,679,114 22 % Total deposits 23,954,037 22,179,697 8 % Accrued interest payable 32,352 31,198 4 % Other liabilities 413,711 273,665 51 % Short-term borrowings 750,000 2,100,000 (64) % Long-term debt 859,823 932,119 (8) % Total liabilities 26,009,923 25,516,679 2 % Stockholders’ equity: Preferred stock, $.01 par value, $1,000 liquidation value: Authorized shares - 10,000,000 Issued shares - 300,000 shares issued at March 31, 2024 and 2023 300,000 300,000 — % Common stock, $.01 par value: Authorized shares - 100,000,000 Issued shares - 51,420,680 and 50,947,306 at March 31, 2024 and 2023, respectively 514 509 1 % Additional paid-in capital 1,044,669 1,031,905 1 % Retained earnings 2,457,222 2,297,850 7 % Treasury stock - 4,434,405 and 3,095,444 shares at cost at March 31, 2024 and 2023, respectively (251,857 ) (175,528 ) 43 % Accumulated other comprehensive loss, net of taxes (379,886 ) (374,762 ) 1 % Total stockholders’ equity 3,170,662 3,079,974 3 % Total liabilities and stockholders’ equity $ 29,180,585 $ 28,596,653 2 % TEXAS CAPITAL BANCSHARES, INC. CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) (dollars in thousands except per share data) Three Months Ended March 31, 2024 2023 Interest income Interest and fees on loans $ 330,879 $ 297,438 Investment securities 32,144 25,292 Interest bearing cash and cash equivalents 54,355 62,436 Total interest income 417,378 385,166 Interest expense Deposits 175,600 120,094 Short-term borrowings 12,783 14,744 Long-term debt 13,986 14,983 Total interest expense 202,369 149,821 Net interest income 215,009 235,345 Provision for credit losses 19,000 28,000 Net interest income after provision for credit losses 196,009 207,345 Non-interest income Service charges on deposit accounts 6,339 5,022 Wealth management and trust fee income 3,567 3,429 Brokered loan fees 1,911 1,895 Investment banking and advisory fees 18,424 14,564 Trading income 4,712 4,204 Other 6,366 8,289 Total non-interest income 41,319 37,403 Non-interest expense Salaries and benefits 128,727 128,670 Occupancy expense 9,737 9,619 Marketing 6,036 9,044 Legal and professional 16,195 14,514 Communications and technology 21,114 17,523 Federal Deposit Insurance Corporation insurance assessment 8,421 2,170 Other 12,163 12,487 Total non-interest expense 202,393 194,027 Income before income taxes 34,935 50,721 Income tax expense 8,793 12,060 Net income 26,142 38,661 Preferred stock dividends 4,313 4,313 Net income available to common stockholders $ 21,829 $ 34,348 Basic earnings per common share $ 0.46 $ 0.71 Diluted earnings per common share $ 0.46 $ 0.70 TEXAS CAPITAL BANCSHARES, INC. SUMMARY OF CREDIT LOSS EXPERIENCE (dollars in thousands) 1st Quarter 4th Quarter 3rd Quarter 2nd Quarter 1st Quarter 2024 2023 2023 2023 2023 Allowance for credit losses on loans: Beginning balance $ 249,973 $ 244,902 $ 237,343 $ 260,928 $ 253,469 Loans charged-off: Commercial 7,544 8,356 13,246 8,852 20,732 Commercial real estate 3,325 5,500 — — — Consumer — — 41 — — Total charge-offs 10,869 13,856 13,287 8,852 20,732 Recoveries: Commercial 105 15 4,346 611 819 Commercial real estate — 4 — — — Consumer — — — 2 3 Total recoveries 105 19 4,346 613 822 Net charge-offs 10,764 13,837 8,941 8,239 19,910 Provision for credit losses on loans 24,753 18,908 16,500 (15,346 ) 27,369 Ending balance $ 263,962 $ 249,973 $ 244,902 $ 237,343 $ 260,928 Allowance for off-balance sheet credit losses: Beginning balance $ 46,362 $ 46,270 $ 44,770 $ 22,424 $ 21,793 Provision for off-balance sheet credit losses (5,753 ) 92 1,500 22,346 631 Ending balance $ 40,609 $ 46,362 $ 46,270 $ 44,770 $ 22,424 Total allowance for credit losses $ 304,571 $ 296,335 $ 291,172 $ 282,113 $ 283,352 Total provision for credit losses $ 19,000 $ 19,000 $ 18,000 $ 7,000 $ 28,000 Allowance for credit losses on loans to total loans held for investment 1.27 % 1.23 % 1.19 % 1.11 % 1.30 % Allowance for credit losses on loans to average total loans held for investment 1.32 % 1.24 % 1.17 % 1.15 % 1.38 % Net charge-offs to average total loans held for investment(1) 0.22 % 0.27 % 0.17 % 0.16 % 0.43 % Net charge-offs to average total loans held for investment for last 12 months(1) 0.20 % 0.25 % 0.26 % 0.23 % 0.19 % Total provision for credit losses to average total loans held for investment(1) 0.38 % 0.37 % 0.34 % 0.14 % 0.60 % Total allowance for credit losses to total loans held for investment 1.46 % 1.46 % 1.41 % 1.32 % 1.41 % (1) Interim period ratios are annualized. TEXAS CAPITAL BANCSHARES, INC. SUMMARY OF NON-PERFORMING ASSETS AND PAST DUE LOANS (dollars in thousands) 1st Quarter 4th Quarter 3rd Quarter 2nd Quarter 1st Quarter 2024 2023 2023 2023 2023 Non-accrual loans held for investment $ 92,849 $ 81,398 $ 63,129 $ 81,039 $ 93,951 Non-accrual loans held for sale(1) 9,250 — — — — Other real estate owned — — — — — Total non-performing assets $ 102,099 $ 81,398 $ 63,129 $ 81,039 $ 93,951 Non-accrual loans held for investment to total loans held for investment 0.45 % 0.40 % 0.31 % 0.38 % 0.47 % Total non-performing assets to total assets 0.35 % 0.29 % 0.21 % 0.28 % 0.33 % Allowance for credit losses on loans to non-accrual loans held for investment 2.8x 3.1x 3.9x 2.9x 2.8x Total allowance for credit losses to non-accrual loans held for investment 3.3x 3.6x 4.6x 3.5x 3.0x Loans held for investment past due 90 days and still accruing $ 3,674 $ 19,523 $ 4,602 $ 64 $ 3,098 Loans held for investment past due 90 days to total loans held for investment 0.02 % 0.10 % 0.02 % — % 0.02 % Loans held for sale past due 90 days and still accruing $ 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) 1st Quarter 4th Quarter 3rd Quarter 2nd Quarter 1st Quarter 2024 2023 2023 2023 2023 Interest income Interest and fees on loans $ 330,879 $ 325,210 $ 345,138 $ 332,867 $ 297,438 Investment securities 32,144 28,454 27,070 27,478 25,292 Interest bearing deposits in other banks 54,355 63,408 53,561 41,571 62,436 Total interest income 417,378 417,072 425,769 401,916 385,166 Interest expense Deposits 175,600 170,173 160,117 137,391 120,094 Short-term borrowings 12,783 18,069 19,576 18,253 14,744 Long-term debt 13,986 14,113 14,005 14,282 14,983 Total interest expense 202,369 202,355 193,698 169,926 149,821 Net interest income 215,009 214,717 232,071 231,990 235,345 Provision for credit losses 19,000 19,000 18,000 7,000 28,000 Net interest income after provision for credit losses 196,009 195,717 214,071 224,990 207,345 Non-interest income Service charges on deposit accounts 6,339 5,397 5,297 5,158 5,022 Wealth management and trust fee income 3,567 3,302 3,509 3,715 3,429 Brokered loan fees 1,911 2,076 2,532 2,415 1,895 Investment banking and advisory fees 18,424 6,906 23,099 19,101 14,564 Trading income 4,712 3,819 6,092 8,397 4,204 Other 6,366 9,633 6,343 7,225 8,289 Total non-interest income 41,319 31,133 46,872 46,011 37,403 Non-interest expense Salaries and benefits 128,727 107,970 110,010 113,050 128,670 Occupancy expense 9,737 9,483 9,910 9,482 9,619 Marketing 6,036 5,686 4,757 6,367 9,044 Legal and professional 16,195 17,127 17,614 15,669 14,514 Communications and technology 21,114 23,607 19,607 20,525 17,523 Federal Deposit Insurance Corporation insurance assessment 8,421 25,143 5,769 3,693 2,170 Other 12,163 12,369 12,224 12,858 12,487 Total non-interest expense 202,393 201,385 179,891 181,644 194,027 Income before income taxes 34,935 25,465 81,052 89,357 50,721 Income tax expense 8,793 5,315 19,373 20,706 12,060 Net income 26,142 20,150 61,679 68,651 38,661 Preferred stock dividends 4,313 4,312 4,313 4,312 4,313 Net income available to common shareholders $ 21,829 $ 15,838 $ 57,366 $ 64,339 $ 34,348 TEXAS CAPITAL BANCSHARES, INC. TAXABLE EQUIVALENT NET INTEREST INCOME ANALYSIS (UNAUDITED)(1) (dollars in thousands) 1st Quarter 2024 4th Quarter 2023 3rd Quarter 2023 2nd Quarter 2023 1st Quarter 2023 Average
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RateAssets Investment securities(2) $ 4,299,368 $ 32,144 2.77 % $ 4,078,975 $ 28,454 2.48 % $ 4,204,749 $ 27,070 2.33 % $ 4,306,881 $ 27,478 2.36 % $ 4,060,456 $ 25,292 2.31 % Interest bearing cash and cash equivalents 4,051,627 54,355 5.40 % 4,637,374 63,408 5.42 % 3,965,045 53,561 5.36 % 3,286,091 41,571 5.07 % 5,541,341 62,436 4.57 % Loans held for sale 51,164 1,184 9.31 % 29,071 672 9.17 % 31,878 647 8.06 % 28,414 599 8.46 % 43,472 938 8.75 % Loans held for investment, mortgage finance(4) 3,517,707 31,455 3.60 % 3,946,280 33,709 3.39 % 4,697,702 50,813 4.29 % 4,376,235 49,425 4.53 % 3,286,804 37,419 4.62 % Loans held for investment(3)(4) 16,522,089 298,306 7.26 % 16,164,233 290,897 7.14 % 16,317,324 293,750 7.14 % 16,217,314 282,956 7.00 % 15,598,854 259,240 6.74 % Less: Allowance for credit losses on loans 249,936 — — 244,287 — — 238,883 — — 261,027 — — 252,727 — — Loans held for investment, net 19,789,860 329,761 6.70 % 19,866,226 324,606 6.48 % 20,776,143 344,563 6.58 % 20,332,522 332,381 6.56 % 18,632,931 296,659 6.46 % Total earning assets 28,192,019 417,444 5.88 % 28,611,646 417,140 5.69 % 28,977,815 425,841 5.75 % 27,953,908 402,029 5.69 % 28,278,200 385,325 5.45 % Cash and other assets 1,058,463 1,120,354 1,106,031 1,049,145 1,041,745 Total assets $ 29,250,482 $ 29,732,000 $ 30,083,846 $ 29,003,053 $ 29,319,945 Liabilities and Stockholders’ Equity Transaction deposits $ 2,006,493 $ 16,858 3.38 % $ 1,972,324 $ 15,613 3.14 % $ 1,755,451 $ 13,627 3.08 % $ 1,345,742 $ 9,468 2.82 % $ 776,500 $ 3,853 2.01 % Savings deposits 11,409,677 136,790 4.82 % 11,043,155 132,801 4.77 % 10,858,306 127,323 4.65 % 10,590,558 114,275 4.33 % 11,195,402 105,707 3.83 % Time deposits 1,719,325 21,952 5.14 % 1,716,812 21,759 5.03 % 1,610,235 19,167 4.72 % 1,531,922 13,648 3.57 % 1,430,657 10,534 2.99 % Total interest bearing deposits 15,135,495 175,600 4.67 % 14,732,291 170,173 4.58 % 14,223,992 160,117 4.47 % 13,468,222 137,391 4.09 % 13,402,559 120,094 3.63 % Short-term borrowings 912,088 12,783 5.64 % 1,257,609 18,069 5.70 % 1,393,478 19,576 5.57 % 1,397,253 18,253 5.24 % 1,242,881 14,744 4.81 % Long-term debt 859,509 13,986 6.54 % 858,858 14,113 6.52 % 858,167 14,005 6.47 % 883,871 14,282 6.48 % 931,796 14,983 6.52 % Total interest bearing liabilities 16,907,092 202,369 4.81 % 16,848,758 202,355 4.76 % 16,475,637 193,698 4.66 % 15,749,346 169,926 4.33 % 15,577,236 149,821 3.90 % Non-interest bearing deposits 8,637,775 9,247,491 10,016,579 9,749,105 10,253,731 Other liabilities 509,286 541,162 474,869 389,155 436,621 Stockholders’ equity 3,196,329 3,094,589 3,116,761 3,115,447 3,052,357 Total liabilities and stockholders’ equity $ 29,250,482 $ 29,732,000 $ 30,083,846 $ 29,003,053 $ 29,319,945 Net interest income $ 215,075 $ 214,785 $ 232,143 $ 232,103 $ 235,504 Net interest margin 3.03 % 2.93 % 3.13 % 3.29 % 3.33 % (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. 
INVESTOR CONTACT Jocelyn Kukulka, 469.399.8544 jocelyn.kukulka@texascapitalbank.com MEDIA CONTACT Julia Monter, 469.399.8425 julia.monter@texascapitalbank.com
