• Texas Capital Bancshares, Inc. Announces Third Quarter 2023 Results

    المصدر: Nasdaq GlobeNewswire / 19 أكتوبر 2023 05:00:01   America/Chicago

    Third quarter 2023 net income of $61.7 million and net income available to common stockholders of $57.4 million, or $1.18 per diluted share

    Top tier capital ratios, including 12.7% CET1 and 17.1% Total Capital

    DALLAS, Oct. 19, 2023 (GLOBE NEWSWIRE) -- Texas Capital Bancshares, Inc. (NASDAQ: TCBI), the parent company of Texas Capital Bank, announced operating results for the third quarter of 2023.

    Net income available to common stockholders was $57.4 million, or $1.18 per diluted share, for the third quarter of 2023, compared to $64.3 million, or $1.33 per diluted share, for the second quarter of 2023 and $37.1 million, or $0.74 per diluted share, for the third quarter of 2022.

    “Our quarterly results demonstrate the power of the platform we built over the last two years,” said Rob C. Holmes, President and CEO. “Our capability and expertise to provide solutions for our clients extends well beyond traditional lending products and is complimented by near record levels of capital and liquidity.”

    FINANCIAL RESULTS     
    (dollars and shares in thousands)     
     3rd Quarter 2nd Quarter 3rd Quarter
      2023   2023   2022 
    OPERATING RESULTS     
    Net income$61,679  $68,651  $41,418 
    Net income available to common stockholders$57,366  $64,339  $37,105 
    Diluted earnings per common share$1.18  $1.33  $0.74 
    Diluted common shares 48,529   48,421   50,418 
    Return on average assets 0.81%  0.95%  0.52%
    Return on average common equity 8.08%  9.17%  5.36%
          
    BALANCE SHEET     
    Loans held for investment$16,183,882  $16,227,203  $14,878,959 
    Loans held for investment, mortgage finance 4,429,489   5,098,812   4,908,822 
    Total loans held for investment 20,613,371   21,326,015   19,787,781 
    Loans held for sale 155,073   29,097   3,142,178 
    Total assets 29,628,249   28,976,544   30,408,513 
    Non-interest bearing deposits 9,352,883   9,429,352   11,494,685 
    Total deposits 23,878,978   23,318,240   24,498,563 
    Stockholders’ equity 3,077,700   3,081,927   2,885,775 
          


    THIRD     QUARTER 2023 COMPARED TO SECOND QUARTER 2023

    For the third quarter of 2023, net income available to common stockholders was $57.4 million, or $1.18 per diluted share, compared to $64.3 million, or $1.33 per diluted share, for the second quarter of 2023.

    Provision for credit losses for the third quarter of 2023 was $18.0 million, compared to $7.0 million for the second quarter of 2023. The $18.0 million provision for credit losses recorded in the third quarter of 2023 resulted primarily from an increase in criticized loans, partially offset by decreases in total loans held for investment (“LHI”) and non-accrual loans.

    Net interest income of $232.1 million for the third quarter of 2023 was relatively flat as compared to $232.0 million for the second quarter of 2023, as increases in average earning assets and yields on average earning assets were offset by increases in funding costs and average interest-bearing liabilities. Net interest margin for the third quarter of 2023 was 3.13%, a decrease of 16 basis points from the second quarter of 2023. LHI, excluding mortgage finance, yields increased 29 basis points from the second quarter of 2023 and LHI, mortgage finance yields decreased 68 basis points from the second quarter of 2023. Total cost of deposits was 2.62% for the third quarter of 2023, a 25 basis point increase from the second quarter of 2023.

    Non-interest income for the third quarter of 2023 increased $861,000, or 2%, compared to the second quarter of 2023, primarily due to an increase in investment banking and trading income, partially offset by a decrease in other non-interest income.

    Non-interest expense for the third quarter of 2023 decreased $1.8 million, or 1%, compared to the second quarter of 2023, primarily due to decreases in salaries and benefits and marketing expenses, partially offset by increases in legal and professional and Federal Deposit Insurance Corporation (“FDIC”) insurance assessment expenses.

    THIRD QUARTER 2023 COMPARED TO THIRD QUARTER 2022

    Net income available to common stockholders was $57.4 million, or $1.18 per diluted share, for the third quarter of 2023, compared to $37.1 million, or $0.74 per diluted share, for the third quarter of 2022.

    The third quarter of 2023 included a $18.0 million provision for credit losses, reflecting an increase in criticized loans, partially offset by decreases in total LHI and non-accrual loans, compared to a $12.0 million provision for credit losses for the third quarter of 2022.

    Net interest income decreased to $232.1 million for the third quarter of 2023, compared to $239.1 million for the third quarter of 2022, primarily due to an increase in funding costs and a decrease in average earning assets, partially offset by an increase in yields on average earning assets. Net interest margin increased 8 basis points to 3.13% for the third quarter of 2023, as compared to the third quarter of 2022. LHI, excluding mortgage finance, yields increased 247 basis points compared to the third quarter of 2022 and LHI, mortgage finance yields decreased 132 basis points from the third quarter of 2022. Total cost of deposits increased 169 basis points compared to the third quarter of 2022.

    Non-interest income for the third quarter of 2023 increased $21.5 million, or 85%, compared to the third quarter of 2022. The increase was primarily due to an increase in investment banking and trading income.

    Non-interest expense for the third quarter of 2023 decreased $17.2 million, or 9%, compared to the third quarter of 2022, primarily due to decreases in salaries and benefits and marketing expenses, partially offset by increases in communications and technology and FDIC insurance assessment expenses. The third quarter of 2022 included $13.7 million in salaries and benefits expense related to the sale of our premium finance subsidiary.

    CREDIT QUALITY

    Net charge-offs of $8.9 million were recorded during the third quarter of 2023, compared to net charge-offs of $8.2 million and $2.7 million during the second quarter of 2023 and the third quarter of 2022, respectively. Criticized loans totaled $677.4 million at September 30, 2023, compared to $619.4 million at June 30, 2023 and $484.0 million at September 30, 2022. Non-accrual LHI totaled $63.1 million at September 30, 2023, compared to $81.0 million at June 30, 2023 and $35.9 million at September 30, 2022. The ratio of non-accrual LHI to total LHI for the third quarter of 2023 was 0.31%, compared to 0.38% for the second quarter of 2023 and 0.18% for the third quarter of 2022. The ratio of total allowance for credit losses to total LHI was 1.41% at September 30, 2023, compared to 1.32% and 1.30% at June 30, 2023 and September 30, 2022, respectively.

    REGULATORY RATIOS AND CAPITAL

    All regulatory ratios continue to be in excess of “well capitalized” requirements as of September 30, 2023. Our CET1, tier 1 capital, total capital and leverage ratios were 12.7%, 14.3%, 17.1% and 12.1%, respectively, at September 30, 2023, compared to 12.2%, 13.7%, 16.4% and 12.4%, respectively, at June 30, 2023 and 11.1%, 12.6%, 15.2% and 10.7%, respectively, at September 30, 2022. At September 30, 2023, our ratio of tangible common equity to total tangible assets was 9.4%, compared to 9.6% at June 30, 2023 and 8.5% at September 30, 2022.

    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 Bank, 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 Bank 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; recent adverse developments in the banking industry highlighted by high-profile bank failures 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; TCBI’s ability to effectively manage its liquidity; TCBI’s ability to pursue and execute upon growth plans, whether as a function of capital, liquidity or other limitations; 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; TCBI’s ability to successfully execute its business strategy, including developing and executing new lines of business and new products and services; 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; negative press and social media attention with respect to the banking industry or TCBI, in particular; the transition away from the London Interbank Offered Rate (LIBOR); legislative and regulatory changes; severe weather, natural disasters, climate change, acts of war, terrorism, global conflict (including those already reported by the media, as well as others that may arise), or other external events, as well as related legislative and regulatory initiatives; and the risks and factors more fully described in TCBI’s most recent Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and other documents and filings with the SEC. The information contained in this communication speaks only as of its date. Except to the extent required by applicable law or regulation, we disclaim any obligation to update such factors or to publicly announce the results of any revisions to any of the forward-looking statements included herein to reflect future events or developments.

    TEXAS CAPITAL BANCSHARES, INC.
    SELECTED FINANCIAL HIGHLIGHTS (UNAUDITED)
    (dollars in thousands except per share data)
     3rd Quarter2nd Quarter1st Quarter4th Quarter3rd Quarter
      2023  2023  2023  2022  2022 
    CONSOLIDATED STATEMENTS OF INCOME     
    Interest income$425,769 $401,916 $385,166 $371,292 $322,072 
    Interest expense 193,698  169,926  149,821  123,687  82,991 
    Net interest income 232,071  231,990  235,345  247,605  239,081 
    Provision for credit losses 18,000  7,000  28,000  34,000  12,000 
    Net interest income after provision for credit losses 214,071  224,990  207,345  213,605  227,081 
    Non-interest income 46,872  46,011  37,403  277,667  25,332 
    Non-interest expense 179,891  181,644  194,027  213,090  197,047 
    Income before income taxes 81,052  89,357  50,721  278,182  55,366 
    Income tax expense 19,373  20,706  12,060  60,931  13,948 
    Net income 61,679  68,651  38,661  217,251  41,418 
    Preferred stock dividends 4,313  4,312  4,313  4,312  4,313 
    Net income available to common stockholders$57,366 $64,339 $34,348 $212,939 $37,105 
    Diluted earnings per common share$1.18 $1.33 $0.70 $4.23 $0.74 
    Diluted common shares 48,528,698  48,421,276  48,880,725  50,282,663  50,417,884 
          
    CONSOLIDATED BALANCE SHEET DATA     
    Total assets$29,628,249 $28,976,544 $28,596,653 $28,414,642 $30,408,513 
    Loans held for investment 16,183,882  16,227,203  16,014,497  15,197,307  14,878,959 
    Loans held for investment, mortgage finance 4,429,489  5,098,812  4,060,570  4,090,033  4,908,822 
    Loans held for sale 155,073  29,097  27,608  36,357  3,142,178 
    Interest bearing cash and cash equivalents 3,975,860  2,587,131  3,385,494  4,778,623  3,399,638 
    Investment securities 4,069,717  4,226,653  4,345,969  3,585,114  3,369,622 
    Non-interest bearing deposits 9,352,883  9,429,352  9,500,583  9,618,081  11,494,685 
    Total deposits 23,878,978  23,318,240  22,179,697  22,856,880  24,498,563 
    Short-term borrowings 1,400,000  1,350,000  2,100,000  1,201,142  1,701,480 
    Long-term debt 858,471  857,795  932,119  931,442  930,766 
    Stockholders’ equity 3,077,700  3,081,927  3,079,974  3,055,351  2,885,775 
          
    End of period shares outstanding 48,015,003  47,992,521  47,851,862  48,783,763  49,897,726 
    Book value per share$57.85 $57.97 $58.10 $56.48 $51.82 
    Tangible book value per share(1)$57.82 $57.93 $58.06 $56.45 $51.48 
          
    SELECTED FINANCIAL RATIOS     
    Net interest margin 3.13% 3.29% 3.33% 3.26% 3.05%
    Return on average assets 0.81% 0.95% 0.53% 2.80% 0.52%
    Return on average common equity 8.08% 9.17% 5.06% 30.66% 5.36%
    Non-interest income to average earning assets 0.64% 0.66% 0.54% 3.70% 0.33%
    Efficiency ratio(2) 64.5% 65.3% 71.1% 40.6% 74.5%
    Non-interest expense to average earning assets 2.46% 2.61% 2.78% 2.84% 2.53%
    Common equity to total assets 9.4% 9.6% 9.7% 9.7% 8.5%
    Tangible common equity to total tangible assets(3) 9.4% 9.6% 9.7% 9.7% 8.5%
    Common Equity Tier 1 12.7% 12.2% 12.4% 13.0% 11.1%
    Tier 1 capital 14.3% 13.7% 14.0% 14.7% 12.6%
    Total capital 17.1% 16.4% 16.9% 17.7% 15.2%
    Leverage 12.1% 12.4% 12.0% 11.5% 10.7%

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

     
     
    TEXAS CAPITAL BANCSHARES, INC.
    CONSOLIDATED BALANCE SHEETS (UNAUDITED)
    (dollars in thousands)
     September 30, 2023September 30, 2022% Change
    Assets   
    Cash and due from banks$216,916 $240,609 (10)%
    Interest bearing cash and cash equivalents 3,975,860  3,399,638 17%
    Available-for-sale debt securities 3,147,865  2,380,774 32%
    Held-to-maturity debt securities 881,352  955,875 (8)%
    Equity securities 40,500  32,973 23%
    Investment securities 4,069,717  3,369,622 21%
    Loans held for sale 155,073  3,142,178 (95)%
    Loans held for investment, mortgage finance 4,429,489  4,908,822 (10)%
    Loans held for investment 16,183,882  14,878,959 9%
    Less: Allowance for credit losses on loans 244,902  234,613 4%
    Loans held for investment, net 20,368,469  19,553,168 4%
    Premises and equipment, net 31,050  27,180 14%
    Accrued interest receivable and other assets 809,668  648,172 25%
    Other assets held for sale —  26,450 (100)%
    Goodwill and intangibles, net 1,496  1,496 —%
    Total assets$29,628,249 $30,408,513 (3)%
        
    Liabilities and Stockholders’ Equity   
    Liabilities:   
    Non-interest bearing deposits$9,352,883 $11,494,685 (19)%
    Interest bearing deposits 14,526,095  13,003,878 12%
    Total deposits 23,878,978  24,498,563 (3)%
    Accrued interest payable 31,149  18,465 69%
    Other liabilities 381,951  297,900 28%
    Other liabilities held for sale —  75,564 (100)%
    Short-term borrowings 1,400,000  1,701,480 (18)%
    Long-term debt 858,471  930,766 (8)%
    Total liabilities 26,550,549  27,522,738 (4)%
        
    Stockholders’ equity:   
    Preferred stock, $.01 par value, $1,000 liquidation value:   
    Authorized shares - 10,000,000   
    Issued shares - 300,000 shares issued at September 30, 2023 and 2022 300,000  300,000 —%
    Common stock, $.01 par value:   
    Authorized shares - 100,000,000   
    Issued shares - 51,110,447 and 50,840,022 at September 30, 2023 and 2022, respectively 511  509 —%
    Additional paid-in capital 1,039,074  1,020,153 2%
    Retained earnings 2,419,555  2,050,563 18%
    Treasury stock - 3,095,444 and 942,296 shares at cost at September 30, 2023 and 2022, respectively (175,528) (50,031)N/M 
    Accumulated other comprehensive loss, net of taxes (505,912) (435,419)16%
    Total stockholders’ equity 3,077,700  2,885,775 7%
    Total liabilities and stockholders’ equity$29,628,249 $30,408,513 (3)%


         
         
    TEXAS CAPITAL BANCSHARES, INC.    
    CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)    
    (dollars in thousands except per share data)    
     Three Months Ended September 30,Nine Months Ended September 30,
     2023202220232022
    Interest income    
    Interest and fees on loans$345,138$282,474$975,443$688,422
    Investment securities 27,070 15,002 79,840 46,969
    Interest bearing cash and cash equivalents 53,561 24,596 157,568 37,561
    Total interest income 425,769 322,072 1,212,851 772,952
    Interest expense    
    Deposits 160,117 60,317 417,602 94,513
    Short-term borrowings 19,576 10,011 52,573 15,628
    Long-term debt 14,005 12,663 43,270 34,651
    Total interest expense 193,698 82,991 513,445 144,792
    Net interest income 232,071 239,081 699,406 628,160
    Provision for credit losses 18,000 12,000 53,000 32,000
    Net interest income after provision for credit losses 214,071 227,081 646,406 596,160
    Non-interest income    
    Service charges on deposit accounts 5,297 5,797 15,477 18,014
    Wealth management and trust fee income 3,509 3,631 10,653 11,594
    Brokered loan fees 2,532 3,401 6,842 11,504
    Investment banking and trading income 29,191 7,812 75,457 23,117
    Other 6,343 4,691 21,857 7,626
    Total non-interest income 46,872 25,332 130,286 71,855
    Non-interest expense    
    Salaries and benefits 110,010 128,764 351,730 331,981
    Occupancy expense 9,910 9,433 29,011 27,192
    Marketing 4,757 8,282 20,168 21,765
    Legal and professional 17,614 16,775 47,797 38,365
    Communications and technology 19,607 18,470 57,655 48,819
    Federal Deposit Insurance Corporation insurance assessment 5,769 3,953 11,632 11,252
    Other 12,224 11,370 37,569 35,068
    Total non-interest expense 179,891 197,047 555,562 514,442
    Income before income taxes 81,052 55,366 221,130 153,573
    Income tax expense 19,373 13,948 52,139 38,346
    Net income 61,679 41,418 168,991 115,227
    Preferred stock dividends 4,313 4,313 12,938 12,938
    Net income available to common stockholders$57,366$37,105$156,053$102,289
         
    Basic earnings per common share$1.19$0.74$3.24$2.03
    Diluted earnings per common share$1.18$0.74$3.20$2.00


     
     
    TEXAS CAPITAL BANCSHARES, INC.
    SUMMARY OF CREDIT LOSS EXPERIENCE
    (dollars in thousands)
     3rd Quarter2nd Quarter1st Quarter4th Quarter3rd Quarter
      2023  2023  2023  2022  2022 
    Allowance for credit losses on loans:     
    Beginning balance$237,343 $260,928 $253,469 $234,613 $229,013 
    Loans charged-off:     
    Commercial 13,246  8,852  20,732  17,106  3,135 
    Consumer 41  —  —  —  — 
    Total charge-offs 13,287  8,852  20,732  17,106  3,135 
    Recoveries:     
    Commercial 4,346  611  819  2,105  400 
    Consumer —  2  3  2  2 
    Total recoveries 4,346  613  822  2,107  402 
    Net charge-offs 8,941  8,239  19,910  14,999  2,733 
    Provision for credit losses on loans 16,500  (15,346) 27,369  33,855  8,333 
    Ending balance$244,902 $237,343 $260,928 $253,469 $234,613 
          
    Allowance for off-balance sheet credit losses:     
    Beginning balance$44,770 $22,424 $21,793 $21,648 $17,981 
    Provision for off-balance sheet credit losses 1,500  22,346  631  145  3,667 
    Ending balance$46,270 $44,770 $22,424 $21,793 $21,648 
          
    Total allowance for credit losses$291,172 $282,113 $283,352 $275,262 $256,261 
    Total provision for credit losses$18,000 $7,000 $28,000 $34,000 $12,000 
          
    Allowance for credit losses on loans to total loans held for investment 1.19% 1.11% 1.30% 1.31% 1.19%
    Allowance for credit losses on loans to average total loans held for investment 1.17% 1.15% 1.38% 1.31% 1.06%
    Net charge-offs to average total loans held for investment(1) 0.17% 0.16% 0.43% 0.31% 0.05%
    Net charge-offs to average total loans held for investment for last 12 months(1) 0.26% 0.23% 0.19% 0.09% 0.03%
    Total provision for credit losses to average total loans held for investment(1) 0.34% 0.14% 0.60% 0.70% 0.22%
    Total allowance for credit losses to total loans held for investment 1.41% 1.32% 1.41% 1.43% 1.30%

    (1) Interim period ratios are annualized.

          
          
    TEXAS CAPITAL BANCSHARES, INC.     
    SUMMARY OF NON-PERFORMING ASSETS AND PAST DUE LOANS   
    (dollars in thousands)     
     3rd Quarter2nd Quarter1st Quarter4th Quarter3rd Quarter
      2023  2023  2023  2022  2022 
    Non-accrual loans held for investment$63,129 $81,039 $93,951 $48,338 $35,864 
    Non-accrual loans held for sale(1) —  —  —  —  1,340 
    Other real estate owned —  —  —  —  — 
    Total non-performing assets$63,129 $81,039 $93,951 $48,338 $37,204 
          
    Non-accrual loans held for investment to total loans held for investment 0.31% 0.38% 0.47% 0.25% 0.18%
    Total non-performing assets to total assets 0.21% 0.28% 0.33% 0.17% 0.12%
    Allowance for credit losses on loans to non-accrual loans held for investment 3.9x 2.9x 2.8x 5.2x 6.5x
    Total allowance for credit losses to non-accrual loans held for investment 4.6x 3.5x 3.0x 5.7x 6.9x
          
    Loans held for investment past due 90 days and still accruing$4,602 $64 $3,098 $131 $30,664 
    Loans held for investment past due 90 days to total loans held for investment 0.02% —% 0.02% —% 0.15%
    Loans held for sale past due 90 days and still accruing(1)(2)$— $— $— $— $4,877 

    (1) Third quarter 2022 includes $1.3 million in non-accrual loans and $3.1 million in loans past due 90 days and still accruing associated to our insurance premium finance subsidiary that were transferred from loans held for investment to loans held for sale as of September 30, 2022.
    (2) Includes loans guaranteed by U.S. government agencies that were repurchased out of Ginnie Mae securities. Loans are recorded as loans held for sale and carried at fair value on the balance sheet. Interest on these past due loans accrues at the debenture rate guaranteed by the U.S. government.

     
     
    TEXAS CAPITAL BANCSHARES, INC.
    CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
    (dollars in thousands)
          
     3rd Quarter2nd Quarter1st Quarter4th Quarter3rd Quarter
     20232023202320222022
    Interest income     
    Interest and fees on loans$345,138$332,867$297,438$295,372$282,474
    Investment securities 27,070 27,478 25,292 16,210 15,002
    Interest bearing deposits in other banks 53,561 41,571 62,436 59,710 24,596
    Total interest income 425,769 401,916 385,166 371,292 322,072
    Interest expense     
    Deposits 160,117 137,391 120,094 96,150 60,317
    Short-term borrowings 19,576 18,253 14,744 13,449 10,011
    Long-term debt 14,005 14,282 14,983 14,088 12,663
    Total interest expense 193,698 169,926 149,821 123,687 82,991
    Net interest income 232,071 231,990 235,345 247,605 239,081
    Provision for credit losses 18,000 7,000 28,000 34,000 12,000
    Net interest income after provision for credit losses 214,071 224,990 207,345 213,605 227,081
    Non-interest income     
    Service charges on deposit accounts 5,297 5,158 5,022 5,252 5,797
    Wealth management and trust fee income 3,509 3,715 3,429 3,442 3,631
    Brokered loan fees 2,532 2,415 1,895 2,655 3,401
    Investment banking and trading income 29,191 27,498 18,768 11,937 7,812
    Gain on disposal of subsidiary — — — 248,526 —
    Other 6,343 7,225 8,289 5,855 4,691
    Total non-interest income 46,872 46,011 37,403 277,667 25,332
    Non-interest expense     
    Salaries and benefits 110,010 113,050 128,670 102,925 128,764
    Occupancy expense 9,910 9,482 9,619 17,030 9,433
    Marketing 4,757 6,367 9,044 10,623 8,282
    Legal and professional 17,614 15,669 14,514 37,493 16,775
    Communications and technology 19,607 20,525 17,523 20,434 18,470
    Federal Deposit Insurance Corporation insurance assessment 5,769 3,693 2,170 3,092 3,953
    Other 12,224 12,858 12,487 21,493 11,370
    Total non-interest expense 179,891 181,644 194,027 213,090 197,047
    Income before income taxes 81,052 89,357 50,721 278,182 55,366
    Income tax expense 19,373 20,706 12,060 60,931 13,948
    Net income 61,679 68,651 38,661 217,251 41,418
    Preferred stock dividends 4,313 4,312 4,313 4,312 4,313
    Net income available to common shareholders$57,366$64,339$34,348$212,939$37,105


     
     
    TEXAS CAPITAL BANCSHARES, INC.
    TAXABLE EQUIVALENT NET INTEREST INCOME ANALYSIS (UNAUDITED)(1)
    (dollars in thousands)
     3rd Quarter 2023 2nd Quarter 2023 1st Quarter 2023 4th Quarter 2022 3rd Quarter 2022
     Average
    Balance    		Income/
    Expense    		Yield/
    Rate    		 Average
    Balance    		Income/
    Expense    		Yield/
    Rate    		 Average
    Balance    		Income/
    Expense    		Yield/
    Rate    		 Average
    Balance    		Income/
    Expense    		Yield/
    Rate    		 Average
    Balance    		Income/
    Expense    		Yield/
    Rate
    Assets                   
    Investment securities(2)$4,204,749$27,0702.33% $4,306,881$27,4782.36% $4,060,456$25,2922.31% $3,385,372$16,2101.70% $3,509,044$15,0021.58%
    Interest bearing cash and cash equivalents 3,965,045 53,5615.36%  3,286,091 41,5715.07%  5,541,341 62,4364.57%  6,158,769 59,7103.85%  4,453,806 24,5962.19%
    Loans held for sale 31,878 6478.06%  28,414 5998.46%  43,472 9388.75%  1,053,157 12,0644.54%  1,029,983 11,3164.36%
    Loans held for investment, mortgage finance 4,697,702 31,2172.64%  4,376,235 36,1983.32%  3,286,804 28,5283.52%  4,279,367 43,7084.05%  5,287,531 52,7563.96%
    Loans held for investment(3) 16,317,324 313,3467.62%  16,217,314 296,1837.33%  15,598,854 268,1316.97%  15,105,083 239,7466.30%  16,843,922 218,5135.15%
    Less: Allowance for credit losses on loans 238,883 ——   261,027 ——   252,727 ——   233,246 ——   229,005 —— 
    Loans held for investment, net 20,776,143 344,5636.58%  20,332,522 332,3816.56%  18,632,931 296,6596.46%  19,151,204 283,4545.87%  21,902,448 271,2694.91%
    Total earning assets 28,977,815 425,8415.75%  27,953,908 402,0295.69%  28,278,200 385,3255.45%  29,748,502 371,4384.89%  30,895,281 322,1834.10%
    Cash and other assets 1,106,031    1,049,145    1,041,745    989,900    918,630  
    Total assets$30,083,846   $29,003,053   $29,319,945   $30,738,402   $31,813,911  
                        
    Liabilities and Stockholders’ Equity                   
    Transaction deposits$1,755,451$13,6273.08% $1,345,742$9,4682.82% $776,500$3,8532.01% $1,105,466$4,9771.79% $1,444,964$5,2391.44%
    Savings deposits 10,858,306 127,3234.65%  10,590,558 114,2754.33%  11,195,402 105,7073.83%  10,563,049 80,8013.03%  10,249,387 46,5551.80%
    Time deposits 1,610,235 19,1674.72%  1,531,922 13,6483.57%  1,430,657 10,5342.99%  1,625,857 10,3722.53%  1,701,238 8,5231.99%
    Total interest bearing deposits 14,223,992 160,1174.47%  13,468,222 137,3914.09%  13,402,559 120,0943.63%  13,294,372 96,1502.87%  13,395,589 60,3171.79%
    Short-term borrowings 1,393,478 19,5765.57%  1,397,253 18,2535.24%  1,242,881 14,7444.81%  1,387,660 13,4493.84%  1,931,537 10,0112.06%
    Long-term debt 858,167 14,0056.47%  883,871 14,2826.48%  931,796 14,9836.52%  931,107 14,0886.00%  921,707 12,6635.45%
    Total interest bearing liabilities 16,475,637 193,6984.66%  15,749,346 169,9264.33%  15,577,236 149,8213.90%  15,613,139 123,6873.14%  16,248,833 82,9912.03%
    Non-interest bearing deposits 10,016,579    9,749,105    10,253,731    11,642,969    12,214,531  
    Other liabilities 474,869    389,155    436,621    426,543    305,554  
    Stockholders’ equity 3,116,761    3,115,447    3,052,357    3,055,751    3,044,993  
    Total liabilities and stockholders’ equity$30,083,846   $29,003,053   $29,319,945   $30,738,402   $31,813,911  
    Net interest income $232,143   $232,103   $235,504   $247,751   $239,192 
    Net interest margin  3.13%   3.29%   3.33%   3.26%   3.05%

    (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.


    INVESTOR CONTACT
Jocelyn Kukulka, 469.399.8544
jocelyn.kukulka@texascapitalbank.com

MEDIA CONTACT
Julia Monter, 469.399.8425
julia.monter@texascapitalbank.com

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