EX-99.1 2 a10172024exhibit991.htm EX-99.1 EARNINGS RELEASE Document

Exhibit 99.1
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INVESTOR CONTACT
Jocelyn Kukulka, 469.399.8544
jocelyn.kukulka@texascapitalbank.com
MEDIA CONTACT
Julia Monter, 469.399.8425
julia.monter@texascapitalbank.com
TEXAS CAPITAL BANCSHARES, INC. ANNOUNCES THIRD QUARTER 2024 RESULTS
Record level of income in fee areas of focus(1)
Quarterly strategic actions include acquisition of $332 million commercial loan portfolio and balance sheet
repositioning of the proceeds from $1.2 billion sale of lower-yielding available-for-sale securities into higher yielding securities
Book Value and Tangible Book Value(2) per share both increased 14% year over year, reaching record levels
Capital ratios continue to be strong, including 11.2% CET1 and 15.2% Total Capital
DALLAS - October 17, 2024 - Texas Capital Bancshares, Inc. (NASDAQ: TCBI), the parent company of Texas Capital Bank, announced operating results for the third quarter of 2024.
Net loss available to common stockholders was $65.6 million, or $1.41 net loss per diluted share, for the third quarter of 2024, compared to net income available to common stockholders of $37.4 million, or $0.80 net income per diluted share, and $57.4 million, or $1.18 per diluted share, for the for the second quarter of 2024 and third quarter of 2023, respectively.
The third quarter of 2024 included a $179.6 million loss on sale of available-for-sale debt securities ($2.92 net loss per diluted share) and restructuring expense of $5.9 million ($0.10 net loss per diluted share), partially offset by a $651,000 release of Federal Deposit Insurance Corporation (“FDIC”) special assessment accrual ($0.01 net income per diluted share).
“We achieved significant financial milestones this quarter as our multi-year transformation is increasingly delivering financial outcomes consistent with realized success delivering our proven and differentiated strategy,” said Rob C. Holmes, President and CEO. “Our current business momentum coupled with our sustained leading capital and liquidity levels positions us well to effectively drive execution through 2025.”
FINANCIAL RESULTS
(dollars and shares in thousands)
3rd Quarter2nd Quarter3rd Quarter
202420242023
OPERATING RESULTS
Net income/(loss)$(61,319)$41,662 $61,679 
Net income/(loss) available to common stockholders$(65,632)$37,350 $57,366 
Diluted earnings/(loss) per common share$(1.41)$0.80 $1.18 
Diluted common shares46,609 46,872 48,529 
Return on average assets(0.78)%0.56 %0.81 %
Return on average common equity(8.87)%5.26 %8.08 %
BALANCE SHEET
Loans held for investment$16,764,512 $16,700,569 $16,183,882 
Loans held for investment, mortgage finance5,529,659 5,078,161 4,429,489 
Total loans held for investment22,294,171 21,778,730 20,613,371 
Loans held for sale9,022 36,785 155,073 
Total assets31,629,299 29,854,994 29,628,249 
Non-interest bearing deposits9,070,804 7,987,715 9,352,883 
Total deposits25,865,255 23,818,327 23,878,978 
Stockholders’ equity3,354,044 3,175,601 3,077,700 
(1)    Fee areas of focus include service charges on deposit accounts, wealth managment and trust fee income, investment banking and advisory fees and trading income.
(2)    Stockholders’ equity excluding preferred stock, less goodwill and intangibles, divided by shares outstanding at period end.


THIRD QUARTER 2024 COMPARED TO SECOND QUARTER 2024
For the third quarter of 2024, net loss available to common stockholders was $65.6 million, or $1.41 net loss per diluted share, compared to net income available to common stockholders of $37.4 million, or $0.80 net income per diluted share, for the second quarter of 2024. The net loss for the third quarter of 2024 resulted primarily from the $179.6 million loss on the sale of available-for-sale debt securities ($2.92 net loss per diluted share).
Provision for credit losses for the third quarter of 2024 was $10.0 million, compared to $20.0 million for the second quarter of 2024. The $10.0 million provision for credit losses recorded in the third quarter of 2024 resulted primarily from growth in total loans held for investment (“LHI”) and $6.1 million in net charge-offs.
Net interest income was $240.1 million for the third quarter of 2024, compared to $216.6 million for the second quarter of 2024, as increases in average earning assets and yields on average earning assets were partially offset by an increase in average interest bearing deposits. Net interest margin for the third quarter of 2024 was 3.16%, an increase of 15 basis points from the second quarter of 2024. LHI, excluding mortgage finance, yields increased 1 basis point from the second quarter of 2024 and LHI, mortgage finance, yields increased 26 basis points from the second quarter of 2024. Total cost of deposits was 2.94% for the third quarter of 2024, a 5 basis point decrease from the second quarter of 2024.
Non-interest income for the third quarter of 2024 decreased $165.2 million compared to the second quarter of 2024, primarily due to the $179.6 million loss on sale of available-for-sale debt securities recognized during the third quarter of 2024, partially offset by increases in investment banking and advisory fees and other non-interest income.
Non-interest expense for the third quarter of 2024 increased $6.9 million, or 4%, compared to the second quarter of 2024, primarily due to increases in salaries and benefits, occupancy expense and communications and technology expense, partially offset by decreases in FDIC assessment expense and other non-interest expense. The third quarter of 2024 included restructuring expenses of $2.4 million recorded in salaries and benefits, $476,000 recorded in occupancy expense and $3.1 million recorded in communications and technology expense. The third quarter of 2024 also included a $651,000 release of FDIC special assessment accrual.
THIRD QUARTER 2024 COMPARED TO THIRD QUARTER 2023
Net loss available to common stockholders was $65.6 million, or $1.41 net loss per diluted share, for the third quarter of 2024, compared to net income available to common stockholders of $57.4 million, or $1.18 net income per diluted share, for the third quarter of 2023.
The third quarter of 2024 included a $10.0 million provision for credit losses, reflecting growth in total LHI and $6.1 million in net charge-offs, compared to an $18.0 million provision for the third quarter of 2023.
Net interest income increased to $240.1 million for the third quarter of 2024, compared to $232.1 million for the third quarter of 2023, primarily due to increases in average total LHI and yields on average earning assets, partially offset by an increase in average interest bearing liabilities. Net interest margin increased 3 basis points to 3.16% for the third quarter of 2024 compared to the third quarter of 2023. LHI, excluding mortgage finance, yields increased 12 basis points compared to the third quarter of 2023 and LHI, mortgage finance yields decreased 9 basis points from the third quarter of 2023. Total cost of deposits increased 32 basis points compared to the third quarter of 2023.
Non-interest income for the third quarter of 2024 decreased $161.6 million compared to the third quarter of 2023. The decrease was primarily due to the $179.6 million loss on sale of available-for-sale debt securities recognized during the third quarter of 2024, partially offset by increases in investment banking and advisory fees and other non-interest income.
Non-interest expense for the third quarter of 2024 increased $15.4 million, or 9%, compared to the third quarter of 2023, primarily due to increases in salaries and benefits, occupancy expense and communications and technology expense, partially offset by decreases in legal and professional expense.
CREDIT QUALITY
Net charge-offs of $6.1 million were recorded during the third quarter of 2024, compared to net charge-offs of $12.0 million and $8.9 million during the second quarter of 2024 and the third quarter of 2023, respectively. Criticized loans totaled $897.7 million at September 30, 2024, compared to $859.7 million at June 30, 2024 and $677.4 million at September 30, 2023. Non-accrual LHI totaled $89.0 million at September 30, 2024, compared to $85.0 million at June 30, 2024 and $63.1 million at September 30, 2023. The ratio of non-accrual LHI to total LHI for the third quarter of 2024 was 0.40%, compared to 0.39% for the second quarter of 2024 and 0.31% for the third quarter of 2023. The ratio of total allowance for credit losses to total LHI was 1.43% at September 30, 2024, compared to 1.44% and 1.41% at June 30, 2024 and September 30, 2023, respectively.
REGULATORY RATIOS AND CAPITAL
All regulatory ratios continue to be in excess of “well capitalized” requirements as of September 30, 2024. CET1, tier 1 capital, total capital and leverage ratios were 11.2%, 12.6%, 15.2% and 11.4%, respectively, at September 30, 2024, compared to 11.6%, 13.1%, 15.7% and 12.2%, respectively, at June 30, 2024 and 12.7%, 14.3%, 17.1% and 12.1%, respectively, at September 30, 2023. At
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September 30, 2024, our ratio of tangible common equity to total tangible assets was 9.7%, compared to 9.6% at June 30, 2024 and 9.4% at September 30, 2023.
About Texas Capital Bancshares, Inc.
Texas Capital Bancshares, Inc. (NASDAQ: TCBI), a member of the Russell 2000® Index and the S&P MidCap 400®, the parent company of Texas Capital Bank d/b/a Texas Capital, is a full-service financial services firm that delivers customized solutions to businesses, entrepreneurs and individual customers. Founded in 1998, the institution 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 its strategic plan and 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.


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TEXAS CAPITAL BANCSHARES, INC.
SELECTED FINANCIAL HIGHLIGHTS (UNAUDITED)
(dollars in thousands except per share data)
3rd Quarter2nd Quarter1st Quarter4th Quarter3rd Quarter
20242024202420232023
CONSOLIDATED STATEMENTS OF INCOME
Interest income$452,533 $422,068 $417,378 $417,072 $425,769 
Interest expense212,431 205,486 202,369 202,355 193,698 
Net interest income240,102 216,582 215,009 214,717 232,071 
Provision for credit losses10,000 20,000 19,000 19,000 18,000 
Net interest income after provision for credit losses230,102 196,582 196,009 195,717 214,071 
Non-interest income(114,771)50,424 41,319 31,133 46,872 
Non-interest expense195,324 188,409 202,393 201,385 179,891 
Income/(loss) before income taxes(79,993)58,597 34,935 25,465 81,052 
Income tax expense/(benefit)(18,674)16,935 8,793 5,315 19,373 
Net income/(loss)(61,319)41,662 26,142 20,150 61,679 
Preferred stock dividends4,313 4,312 4,313 4,312 4,313 
Net income/(loss) available to common stockholders$(65,632)$37,350 $21,829 $15,838 $57,366 
Diluted earnings/(loss) per common share$(1.41)$0.80 $0.46 $0.33 $1.18 
Diluted common shares46,608,742 46,872,498 47,711,192 48,097,517 48,528,698 
CONSOLIDATED BALANCE SHEET DATA
Total assets$31,629,299 $29,854,994 $29,180,585 $28,356,266 $29,628,249 
Loans held for investment16,764,512 16,700,569 16,677,691 16,362,230 16,183,882 
Loans held for investment, mortgage finance5,529,659 5,078,161 4,153,313 3,978,328 4,429,489 
Loans held for sale9,022 36,785 37,750 44,105 155,073 
Interest bearing cash and cash equivalents3,894,537 2,691,352 3,148,157 3,042,357 3,975,860 
Investment securities4,405,520 4,388,976 4,414,280 4,143,194 4,069,717 
Non-interest bearing deposits9,070,804 7,987,715 8,478,215 7,328,276 9,352,883 
Total deposits25,865,255 23,818,327 23,954,037 22,371,839 23,878,978 
Short-term borrowings1,035,000 1,675,000 750,000 1,500,000 1,400,000 
Long-term debt660,172 659,997 859,823 859,147 858,471 
Stockholders’ equity3,354,044 3,175,601 3,170,662 3,199,142 3,077,700 
End of period shares outstanding46,207,757 46,188,078 46,986,275 47,237,912 48,015,003 
Book value per share$66.09 $62.26 $61.10 $61.37 $57.85 
Tangible book value per share(1)
$66.06 $62.23 $61.06 $61.34 $57.82 
SELECTED FINANCIAL RATIOS
Net interest margin3.16 %3.01 %3.03 %2.93 %3.13 %
Return on average assets(0.78)%0.56 %0.36 %0.27 %0.81 %
Return on average common equity(8.87)%5.26 %3.03 %2.25 %8.08 %
Non-interest income to average earning assets(1.52)%0.71 %0.59 %0.43 %0.64 %
Efficiency ratio(2)
155.8 %70.6 %79.0 %81.9 %64.5 %
Non-interest expense to average earning assets2.59 %2.65 %2.89 %2.79 %2.46 %
Common equity to total assets9.7 %9.6 %9.8 %10.2 %9.4 %
Tangible common equity to total tangible assets(3)
9.7 %9.6 %9.8 %10.2 %9.4 %
Common Equity Tier 111.2 %11.6 %12.4 %12.6 %12.7 %
Tier 1 capital12.6 %13.1 %13.9 %14.2 %14.3 %
Total capital15.2 %15.7 %16.6 %17.1 %17.1 %
Leverage11.4 %12.2 %12.4 %12.2 %12.1 %
(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, less goodwill and intangibles, divided by total assets, less goodwill and intangibles.
    
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TEXAS CAPITAL BANCSHARES, INC.
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(dollars in thousands)
September 30, 2024September 30, 2023% Change
Assets
Cash and due from banks$297,048 $216,916 37 %
Interest bearing cash and cash equivalents3,894,537 3,975,860 (2)%
Available-for-sale debt securities3,518,662 3,147,865 12 %
Held-to-maturity debt securities812,432 881,352 (8)%
Equity securities74,426 40,500 84 %
Investment securities4,405,520 4,069,717 8 %
Loans held for sale9,022 155,073 (94)%
Loans held for investment, mortgage finance5,529,659 4,429,489 25 %
Loans held for investment16,764,512 16,183,882 4 %
Less: Allowance for credit losses on loans273,143 244,902 12 %
Loans held for investment, net22,021,028 20,368,469 8 %
Premises and equipment, net81,577 31,050 163 %
Accrued interest receivable and other assets919,071 809,668 14 %
Goodwill and intangibles, net1,496 1,496 — %
Total assets$31,629,299 $29,628,249 7 %
Liabilities and Stockholders’ Equity
Liabilities:
Non-interest bearing deposits$9,070,804 $9,352,883 (3)%
Interest bearing deposits16,794,451 14,526,095 16 %
Total deposits25,865,255 23,878,978 8 %
Accrued interest payable18,679 31,149 (40)%
Other liabilities696,149 381,951 82 %
Short-term borrowings1,035,000 1,400,000 (26)%
Long-term debt660,172 858,471 (23)%
Total liabilities28,275,255 26,550,549 6 %
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, 2024 and 2023
300,000 300,000 — %
Common stock, $.01 par value:
Authorized shares - 100,000,000
Issued shares - 51,494,260 and 51,110,447 at September 30, 2024 and 2023, respectively
515 511 1 %
Additional paid-in capital1,054,614 1,039,074 1 %
Retained earnings2,428,940 2,419,555 — %
Treasury stock - 5,286,503 and 3,095,444 shares at cost at September 30, 2024 and 2023, respectively
(301,868)(175,528)72 %
Accumulated other comprehensive loss, net of taxes(128,157)(505,912)(75)%
Total stockholders’ equity3,354,044 3,077,700 9 %
Total liabilities and stockholders’ equity$31,629,299 $29,628,249 7 %
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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,
2024202320242023
Interest income
Interest and fees on loans$361,407 $345,138 $1,037,537 $975,443 
Investment securities38,389 27,070 104,117 79,840 
Interest bearing cash and cash equivalents52,737 53,561 150,325 157,568 
Total interest income452,533 425,769 1,291,979 1,212,851 
Interest expense
Deposits190,255 160,117 547,135 417,602 
Short-term borrowings13,784 19,576 39,316 52,573 
Long-term debt8,392 14,005 33,835 43,270 
Total interest expense212,431 193,698 620,286 513,445 
Net interest income240,102 232,071 671,693 699,406 
Provision for credit losses10,000 18,000 49,000 53,000 
Net interest income after provision for credit losses230,102 214,071 622,693 646,406 
Non-interest income
Service charges on deposit accounts6,307 5,297 18,557 15,477 
Wealth management and trust fee income4,040 3,509 11,306 10,653 
Brokered loan fees2,400 2,532 6,442 6,842 
Investment banking and advisory fees34,753 23,099 78,225 56,764 
Trading income5,786 6,092 16,148 18,693 
Available-for-sale debt securities gains/(losses), net
(179,581)— (179,581)489 
Other11,524 6,343 25,875 21,368 
Total non-interest income(114,771)46,872 (23,028)130,286 
Non-interest expense
Salaries and benefits121,138 110,010 368,705 351,730 
Occupancy expense12,937 9,910 33,340 29,011 
Marketing5,863 4,757 17,895 20,168 
Legal and professional11,135 17,614 38,603 47,797 
Communications and technology25,951 19,607 69,078 57,655 
Federal Deposit Insurance Corporation insurance assessment4,906 5,769 18,897 11,632 
Other13,394 12,224 39,608 37,569 
Total non-interest expense195,324 179,891 586,126 555,562 
Income/(loss) before income taxes(79,993)81,052 13,539 221,130 
Income tax expense/(benefit)(18,674)19,373 7,054 52,139 
Net income/(loss)(61,319)61,679 6,485 168,991 
Preferred stock dividends4,313 4,313 12,938 12,938 
Net income/(loss) available to common stockholders$(65,632)$57,366 $(6,453)$156,053 
Basic earnings/(loss) per common share$(1.42)$1.19 $(0.14)$3.24 
Diluted earnings/(loss) per common share$(1.41)$1.18 $(0.14)$3.20 
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TEXAS CAPITAL BANCSHARES, INC.
SUMMARY OF CREDIT LOSS EXPERIENCE
(dollars in thousands)
3rd Quarter2nd Quarter1st Quarter4th Quarter3rd Quarter
20242024202420232023
Allowance for credit losses on loans:
Beginning balance$267,297 $263,962 $249,973 $244,902 $237,343 
Allowance established for acquired purchase credit deterioration loans2,579 — — — — 
Loans charged-off:
Commercial6,120 9,997 7,544 8,356 13,246 
Commercial real estate262 2,111 3,325 5,500 — 
Consumer30 — — — 41 
Total charge-offs6,412 12,108 10,869 13,856 13,287 
Recoveries:
Commercial329 153 105 15 4,346 
Commercial real estate— — — 4 — 
Consumer— — — — — 
Total recoveries329 153 105 19 4,346 
Net charge-offs6,083 11,955 10,764 13,837 8,941 
Provision for credit losses on loans9,350 15,290 24,753 18,908 16,500 
Ending balance$273,143 $267,297 $263,962 $249,973 $244,902 
Allowance for off-balance sheet credit losses:
Beginning balance$45,319 $40,609 $46,362 $46,270 $44,770 
Provision for off-balance sheet credit losses650 4,710 (5,753)92 1,500 
Ending balance$45,969 $45,319 $40,609 $46,362 $46,270 
Total allowance for credit losses$319,112 $312,616 $304,571 $296,335 $291,172 
Total provision for credit losses$10,000 $20,000 $19,000 $19,000 $18,000 
Allowance for credit losses on loans to total loans held for investment1.23 %1.23 %1.27 %1.23 %1.19 %
Allowance for credit losses on loans to average total loans held for investment1.24 %1.27 %1.32 %1.24 %1.17 %
Net charge-offs to average total loans held for investment(1)
0.11 %0.23 %0.22 %0.27 %0.17 %
Net charge-offs to average total loans held for investment for last 12 months(1)
0.20 %0.22 %0.20 %0.25 %0.26 %
Total provision for credit losses to average total loans held for investment(1)
0.18 %0.38 %0.38 %0.37 %0.34 %
Total allowance for credit losses to total loans held for investment
1.43 %1.44 %1.46 %1.46 %1.41 %
(1)Interim period ratios are annualized.
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TEXAS CAPITAL BANCSHARES, INC.
SUMMARY OF NON-PERFORMING ASSETS AND PAST DUE LOANS
(dollars in thousands)
3rd Quarter2nd Quarter1st Quarter4th Quarter3rd Quarter
20242024202420232023
Non-accrual loans held for investment$88,960 $85,021 $92,849 $81,398 $63,129 
Non-accrual loans held for sale(1)— — 9,250 — — 
Other real estate owned— — — — — 
Total non-performing assets$88,960 $85,021 $102,099 $81,398 $63,129 
Non-accrual loans held for investment to total loans held for investment0.40 %0.39 %0.45 %0.40 %0.31 %
Total non-performing assets to total assets0.28 %0.28 %0.35 %0.29 %0.21 %
Allowance for credit losses on loans to non-accrual loans held for investment3.1x3.1x2.8x3.1x3.9x
Total allowance for credit losses to non-accrual loans held for investment3.6x3.7x3.3x3.6x4.6x
Loans held for investment past due 90 days and still accruing
$5,281 $286 $3,674 $19,523 $4,602 
Loans held for investment past due 90 days to total loans held for investment0.02 %— %0.02 %0.10 %0.02 %
Loans held for sale past due 90 days and still accruing
$— $64 $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.

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TEXAS CAPITAL BANCSHARES, INC.
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
(dollars in thousands)
3rd Quarter2nd Quarter1st Quarter4th Quarter3rd Quarter
20242024202320232023
Interest income
Interest and fees on loans$361,407 $345,251 $330,879 $325,210 $345,138 
Investment securities38,389 33,584 32,144 28,454 27,070 
Interest bearing deposits in other banks52,737 43,233 54,355 63,408 53,561 
Total interest income452,533 422,068 417,378 417,072 425,769 
Interest expense
Deposits190,255 181,280 175,600 170,173 160,117 
Short-term borrowings13,784 12,749 12,783 18,069 19,576 
Long-term debt8,392 11,457 13,986 14,113 14,005 
Total interest expense212,431 205,486 202,369 202,355 193,698 
Net interest income240,102 216,582 215,009 214,717 232,071 
Provision for credit losses10,000 20,000 19,000 19,000 18,000 
Net interest income after provision for credit losses230,102 196,582 196,009 195,717 214,071 
Non-interest income
Service charges on deposit accounts6,307 5,911 6,339 5,397 5,297 
Wealth management and trust fee income4,040 3,699 3,567 3,302 3,509 
Brokered loan fees2,400 2,131 1,911 2,076 2,532 
Investment banking and advisory fees34,753 25,048 18,424 6,906 23,099 
Trading income5,786 5,650 4,712 3,819 6,092 
Available-for-sale debt securities gains/(losses), net
(179,581)— — — — 
Other11,524 7,985 6,366 9,633 6,343 
Total non-interest income(114,771)50,424 41,319 31,133 46,872 
Non-interest expense
Salaries and benefits121,138 118,840 128,727 107,970 110,010 
Occupancy expense12,937 10,666 9,737 9,483 9,910 
Marketing5,863 5,996 6,036 5,686 4,757 
Legal and professional11,135 11,273 16,195 17,127 17,614 
Communications and technology25,951 22,013 21,114 23,607 19,607 
Federal Deposit Insurance Corporation insurance assessment4,906 5,570 8,421 25,143 5,769 
Other 13,394 14,051 12,163 12,369 12,224 
Total non-interest expense195,324 188,409 202,393 201,385 179,891 
Income/(loss) before income taxes(79,993)58,597 34,935 25,465 81,052 
Income tax expense/(benefit)(18,674)16,935 8,793 5,315 19,373 
Net income/(loss)(61,319)41,662 26,142 20,150 61,679 
Preferred stock dividends4,313 4,312 4,313 4,312 4,313 
Net income/(loss) available to common shareholders$(65,632)$37,350 $21,829 $15,838 $57,366 

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TEXAS CAPITAL BANCSHARES, INC.
TAXABLE EQUIVALENT NET INTEREST INCOME ANALYSIS (UNAUDITED)(1)
(dollars in thousands)
3rd Quarter 20242nd Quarter 20241st Quarter 20244th Quarter 20233rd Quarter 2023
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)
$4,314,834 $38,389 3.34 %$4,427,023 $33,584 2.80 %$4,299,368 $32,144 2.77 %$4,078,975 $28,454 2.48 %$4,204,749 $27,070 2.33 %
Interest bearing cash and cash equivalents3,958,843 52,737 5.30 %3,273,069 43,233 5.31 %4,051,627 54,355 5.40 %4,637,374 63,408 5.42 %3,965,045 53,561 5.36 %
Loans held for sale23,793 565 9.44 %28,768 683 9.55 %51,164 1,184 9.31 %29,071 672 9.17 %31,878 647 8.06 %
Loans held for investment, mortgage finance(4)
5,152,317 54,371 4.20 %4,357,288 42,722 3.94 %3,517,707 31,455 3.60 %3,946,280 33,709 3.39 %4,697,702 50,813 4.29 %
Loans held for investment(3)(4)
16,792,446 306,541 7.26 %16,750,788 301,910 7.25 %16,522,089 298,306 7.26 %16,164,233 290,897 7.14 %16,317,324 293,750 7.14 %
Less: Allowance for credit losses on loans
266,915 — — 263,145 — — 249,936 — — 244,287 — — 238,883 — — 
Loans held for investment, net21,677,848 360,912 6.62 %20,844,931 344,632 6.65 %19,789,860 329,761 6.70 %19,866,226 324,606 6.48 %20,776,143 344,563 6.58 %
Total earning assets29,975,318 452,603 5.96 %28,573,791 422,132 5.86 %28,192,019 417,444 5.88 %28,611,646 417,140 5.69 %28,977,815 425,841 5.75 %
Cash and other assets1,239,855 1,177,061 1,058,463 1,120,354 1,106,031 
Total assets$31,215,173 $29,750,852 $29,250,482 $29,732,000 $30,083,846 
Liabilities and Stockholders’ Equity
Transaction deposits$1,988,688 $15,972 3.20 %$2,061,622 $16,982 3.31 %$2,006,493 $16,858 3.38 %$1,972,324 $15,613 3.14 %$1,755,451 $13,627 3.08 %
Savings deposits12,240,616 147,770 4.80 %11,981,668 143,173 4.81 %11,409,677 136,790 4.82 %11,043,155 132,801 4.77 %10,858,306 127,323 4.65 %
Time deposits2,070,537 26,513 5.09 %1,658,899 21,125 5.12 %1,719,325 21,952 5.14 %1,716,812 21,759 5.03 %1,610,235 19,167 4.72 %
Total interest bearing deposits16,299,841 190,255 4.64 %15,702,189 181,280 4.64 %15,135,495 175,600 4.67 %14,732,291 170,173 4.58 %14,223,992 160,117 4.47 %
Short-term borrowings1,012,608 13,784 5.42 %927,253 12,749 5.53 %912,088 12,783 5.64 %1,257,609 18,069 5.70 %1,393,478 19,576 5.57 %
Long-term debt660,098 8,392 5.06 %778,401 11,457 5.92 %859,509 13,986 6.54 %858,858 14,113 6.52 %858,167 14,005 6.47 %
Total interest bearing liabilities17,972,547 212,431 4.70 %17,407,843 205,486 4.75 %16,907,092 202,369 4.81 %16,848,758 202,355 4.76 %16,475,637 193,698 4.66 %
Non-interest bearing deposits9,439,020 8,647,594 8,637,775 9,247,491 10,016,579 
Other liabilities558,368 537,754 509,286 541,162 474,869 
Stockholders’ equity3,245,238 3,157,661 3,196,329 3,094,589 3,116,761 
Total liabilities and stockholders’ equity$31,215,173 $29,750,852 $29,250,482 $29,732,000 $30,083,846 
Net interest income
$240,172 $216,646 $215,075 $214,785 $232,143 
Net interest margin3.16 %3.01 %3.03 %2.93 %3.13 %
(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.
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