TEXAS CAPITAL BANCSHARES INC/TX - FORM 8-K - EX-99.1

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EX-99.2 - EX-99.2 - TEXAS CAPITAL BANCSHARES INC/TX	d573358dex992.htm
8-K - FORM 8-K - TEXAS CAPITAL BANCSHARES INC/TX	d573358d8k.htm

Exhibit 99.1

LOGO

July 24, 2013

MEDIA CONTACT

Heather Worley, 214.932.6827

heather.worley@texascapitalbank.com

INVESTOR CONTACT

Myrna Vance, 214.932.6646

myrna.vance@texascapitalbank.com

TEXAS CAPITAL BANCSHARES, INC. ANNOUNCES OPERATING RESULTS FOR Q2 2013

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

•

Net income decreased 27% on a linked quarter basis and decreased 19% from the second quarter of 2012 (12% decrease on a linked quarter basis and 2% decrease from the second quarter of 2012 excluding charge related to organizational change)

•

EPS decreased 35% on a linked quarter basis and 32% from the second quarter of 2012 (20% decrease on a linked quarter basis and 16% decrease from the second quarter of 2012 excluding charge related to organizational change)

•

Demand deposits increased 11% and total deposits increased 3% on a linked quarter basis; grew 45% and 20%, respectively, from the second quarter of 2012

•

Loans held for investment increased 9% and total loans increased 9% on a linked quarter basis; both grew 20% from the second quarter of 2012, resulting in a significant increase in the provision

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

FINANCIAL SUMMARY

(dollars and shares in thousands)


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

(1)	Operating results, assets and loans are reporting from continuing operations

DETAILED FINANCIALS

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

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

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

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

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

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

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

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

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

ABOUT TEXAS CAPITAL BANCSHARES, INC.

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

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

TEXAS CAPITAL BANCSHARES, INC.

SELECTED FINANCIAL HIGHLIGHTS (UNAUDITED)

(Dollars in thousands except per share data)


	2^nd Quarter 2013			1^st Quarter 2013			4^th Quarter 2012			3^rd Quarter 2012			2^nd Quarter 2012
CONSOLIDATED STATEMENT OF INCOME
Interest income	$	107,264		$	104,179		$	107,769		$	102,011		$	95,546
Interest expense		6,044			6,137			6,614			5,156			4,906

Net interest income		101,220			98,042			101,155			96,855			90,640
Provision for credit losses		7,000			2,000			4,500			3,000			1,000

Net interest income after provision for credit losses		94,220			96,042			96,655			93,855			89,640
Non-interest income		11,128			11,281			12,836			10,552			10,462
Non-interest expense		68,734			55,700			60,074			53,521			53,973

Income from continuing operations before income taxes		36,614			51,623			49,417			50,886			46,129
Income tax expense		12,542			18,479			17,982			18,316			16,506

Income from continuing operations		24,072			33,144			31,435			32,570			29,623
Income (loss) from discontinued operations (after-tax)		1			(1	)		(6	)		(34	)		(1	)

Net income		24,073			33,143			31,429			32,536			29,622
Preferred stock dividends		2,438			81			—			—			—

Net income available to common shareholders	$	21,635		$	33,062		$	31,429		$	32,536		$	29,622

Diluted EPS from continuing operations	$	.52		$	.80		$	.76		$	.80		$	.76
Diluted EPS	$	.52		$	.80		$	.76		$	.80		$	.76
Diluted shares		41,723,525			41,429,244			41,505,026			40,755,733			39,141,544
CONSOLIDATED BALANCE SHEET DATA
Total assets	$	10,977,990		$	10,020,565		$	10,540,542		$	9,881,362		$	9,144,360
Loans held for investment		7,510,662			6,920,011			6,785,535			6,549,089			6,234,692
Loans held for sale		2,838,234			2,577,830			3,175,272			2,818,622			2,408,032
Securities		75,861			87,527			100,195			107,288			114,964
Demand deposits		2,928,735			2,628,446			2,535,375			2,114,279			2,019,473
Total deposits		7,980,598			7,745,831			7,440,804			6,717,579			6,660,290
Other borrowings		1,634,630			938,134			1,947,161			2,046,169			1,609,039
Subordinated notes		111,000			111,000			111,000			111,000			—
Long-term debt		113,406			113,406			113,406			113,406			113,406
Stockholders’ equity		1,034,955			1,013,195			836,242			802,406			680,705
End of period shares outstanding		40,862,481			40,771,414			40,727,579			40,580,283			38,114,012
Book value (excluding securities gains/losses)	$	21.60		$	21.10		$	20.45		$	19.68		$	17.75
Tangible book value (excluding securities gains/losses)	$	21.08		$	20.62		$	19.96		$	19.18		$	17.22
SELECTED FINANCIAL RATIOS
Net interest margin		4.19	%		4.27	%		4.27	%		4.36	%		4.49	%
Return on average assets		0.95	%		1.38	%		1.27	%		1.40	%		1.40	%
Return on average common equity		9.94	%		15.82	%		15.35	%		17.27	%		18.08	%
Non-interest income to earning assets		.46	%		.49	%		.54	%		.47	%		.52	%
Efficiency ratio		61.2	%		50.9	%		52.7	%		49.8	%		53.4	%
Efficiency ratio (excluding OREO valuation/write-down)		60.8	%		50.9	%		51.9	%		49.8	%		50.3	%
Non-interest expense to earning assets		2.84	%		2.42	%		2.53	%		2.40	%		2.67	%
Non-interest expense to earning assets (excluding OREO valuation charge)		2.83	%		2.42	%		2.49	%		2.40	%		2.52	%
Tangible common equity to total tangible assets		7.9	%		8.4	%		7.7	%		7.9	%		7.2	%

TEXAS CAPITAL BANCSHARES, INC.

CONSOLIDATED BALANCE SHEETS (UNAUDITED)

(Dollars in thousands)


	June 30, 2013			June 30, 2012			% Change
Assets
Cash and due from banks	$	90,992		$	93,377			(3	)%
Interest-bearing deposits		142,928			49,254			190	%
Federal funds sold		85,120			20			N/M
Securities, available-for-sale		75,861			114,964			(34	)%
Loans held for sale		2,838,234			2,408,032			18	%
Loans held for sale from discontinued operations		298			388			(23	)%
Loans held for investment (net of unearned income)		7,510,662			6,234,692			20	%
Less: Allowance for loan losses		79,428			72,404			10	%

Loans held for investment, net		7,431,234			6,162,288			21	%
Premises and equipment, net		11,915			12,037			(1	)%
Accrued interest receivable and other assets		280,067			284,207			(1	)%
Goodwill and intangibles, net		21,639			20,181			7	%

Total assets	$	10,978,288		$	9,144,748			20	%

Liabilities and Stockholders’ Equity
Liabilities:
Deposits:
Non-interest bearing	$	2,928,735		$	2,019,473			45	%
Interest bearing		4,702,902			4,230,806			11	%
Interest bearing in foreign branches		348,961			410,011			(15	)%

Total deposits		7,980,598			6,660,290			20	%
Accrued interest payable		1,023			887			15	%
Other liabilities		102,676			80,421			27	%
Federal funds purchased		307,515			271,835			13	%
Repurchase agreements		27,079			22,148			22	%
Other borrowings		1,300,036			1,315,056			(1	)%
Subordinated notes		111,000			—			100	%
Trust preferred subordinated debentures		113,406			113,406			—

Total liabilities		9,943,333			8,464,043			17	%
Stockholders’ equity:
Preferred stock, $.01 par value, $1,000 liquidation value:		150,000			—			100	%
Common stock, $.01 par value:
Authorized shares – 100,000,000
Issued shares – 40,862,898 and 38,114,429 at June 30, 2013 and 2012, respectively		408			381			7	%
Additional paid-in capital		445,270			357,713			24	%
Retained earnings		437,152			318,490			37	%
Treasury stock (shares at cost: 417 at June 30, 2013 and 2012, respectively)		(8	)		(8	)		—
Accumulated other comprehensive income, net of taxes		2,133			4,129			(48	)%

Total stockholders’ equity		1,034,955			680,705			52	%

Total liabilities and stockholders’ equity	$	10,978,288		$	9,144,748			20	%

TEXAS CAPITAL BANCSHARES, INC.

CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

(Dollars in thousands except per share data)


	Three Months Ended June 30					Six Months Ended June 30
	2013		2012			2013		2012
Interest income
Interest and fees on loans	$	106,418	$	94,291		$	209,600	$	186,065
Securities		773		1,203			1,712		2,510
Federal funds sold		13		4			19		5
Deposits in other banks		60		48			112		97

Total interest income		107,264		95,546			211,443		188,677
Interest expense
Deposits		3,228		3,482			6,473		6,954
Federal funds purchased		206		240			418		521
Repurchase agreements		5		4			9		7
Other borrowings		143		492			356		927
Subordinated notes		1,829		—			3,658		—
Trust preferred subordinated debentures		633		688			1,267		1,399

Total interest expense		6,044		4,906			12,181		9,808

Net interest income		101,220		90,640			199,262		178,869
Provision for credit losses		7,000		1,000			9,000		4,000

Net interest income after provision for credit losses		94,220		89,640			190,262		174,869
Non-interest income
Service charges on deposit accounts		1,749		1,624			3,450		3,228
Trust fee income		1,269		1,232			2,510		2,346
Bank owned life insurance (BOLI) income		463		588			961		1,109
Brokered loan fees		4,778		4,128			9,522		7,779
Swap fees		981		622			2,633		1,419
Other		1,888		2,268			3,333		3,771

Total non-interest income		11,128		10,462			22,409		19,652
Non-interest expense
Salaries and employee benefits		45,191		30,230			78,732		59,249
Net occupancy expense		4,135		3,679			7,992		7,283
Marketing		4,074		3,174			8,046		5,997
Legal and professional		4,707		3,330			8,647		7,321
Communications and technology		3,347		2,720			6,469		5,203
Allowance and other carrying costs for OREO		482		3,812			912		7,154
Other		6,798		7,028			13,636		14,042

Total non-interest expense		68,734		53,973			124,434		106,249

Income from continuing operations before income taxes		36,614		46,129			88,237		88,272
Income tax expense		12,542		16,506			31,021		31,568

Income from continuing operations		24,072		29,623			57,216		56,704
Income (loss) from discontinued operations (after-tax)		1		(1	)		—		3

Net income		24,073		29,622			57,216		56,707
Preferred stock dividends		2,438		—			2,519		—

Net income available to common shareholders	$	21,635	$	29,622		$	54,697	$	56,707

Basic earnings per common share:
Income from continuing operations	$	.53	$	.78		$	1.34	$	1.50
Net income	$	.53	$	.78		$	1.34	$	1.50
Diluted earnings per common share:
Income from continuing operations	$	.52	$	.76		$	1.31	$	1.45
Net income	$	.52	$	.76		$	1.31	$	1.45

TEXAS CAPITAL BANCSHARES, INC.

SUMMARY OF LOAN LOSS EXPERIENCE

(Dollars in thousands)


	2^nd Quarter 2013			1^st Quarter 2013			4^th Quarter 2012			3^rd Quarter 2012			2^nd Quarter 2012
Reserve for loan losses:
Beginning balance	$	75,000		$	74,337		$	73,722		$	72,404		$	71,992
Loans charged-off:
Commercial		2,826			1,648			4,044			1,154			1,048
Real estate – term		26			105			—			284			56
Consumer		26			19			—			49			—
Leases		—			—			34			49			26

Total loans charged-off		2,878			1,772			4,078			1,536			1,130
Recoveries:
Commercial		348			397			350			132			191
Real estate – construction		—			—			—			10			—
Real estate – term		7			8			226			130			348
Consumer		15			30			7			18			3
Leases		140			121			21			16			55

Total recoveries		510			556			604			306			597

Net charge-offs		2,368			1,216			3,474			1,230			533
Provision for loan losses		6,796			1,879			4,089			2,548			945

Ending balance	$	79,428		$	75,000		$	74,337		$	73,722		$	72,404

Reserve for off-balance sheet credit losses:
Beginning balance	$	3,976		$	3,855		$	3,444		$	2,992		$	2,937
Provision for off-balance sheet credit losses		204			121			411			452			55

Ending balance	$	4,180		$	3,976		$	3,855		$	3,444		$	2,992

Total reserves for credit losses	$	83,608		$	78,976		$	78,192		$	77,166		$	75,396
Total provision for credit losses	$	7,000		$	2,000		$	4,500		$	3,000		$	1,000
Reserve to loans held for investment⁽²⁾		1.06	%		1.08	%		1.10	%		1.13	%		1.16	%
Reserve to average loans held for investment⁽²⁾		1.11	%		1.10	%		1.12	%		1.16	%		1.22	%
Net charge-offs to average loans⁽¹⁾⁽²⁾		.13	%		.07	%		.21	%		.08	%		.04	%
Net charge-offs to average loans for last twelve months⁽¹⁾⁽²⁾		.12	%		.10	%		.10	%		.10	%		.20	%
Total provision for credit losses to average loans⁽¹⁾⁽²⁾		.39	%		.12	%		.27	%		.19	%		.07	%
Combined reserves for credit losses to loans held for investment⁽²⁾		1.11	%		1.14	%		1.15	%		1.18	%		1.21	%
Non-performing assets (NPAs):
Non-accrual loans	$	38,450		$	43,424		$	55,833		$	57,275		$	56,433
Other real estate owned (OREO)⁽⁴⁾		13,053			14,426			15,991			19,079			27,882

Total	$	51,503		$	57,850		$	71,824		$	76,354		$	84,315

Non-accrual loans to loans⁽²⁾		.51	%		.63	%		.82	%		.87	%		.91	%
Total NPAs to loans plus OREO⁽²⁾		.68	%		.83	%		1.06	%		1.16	%		1.35	%
Total NPAs to earning assets		.49	%		.60	%		.71	%		.81	%		.97	%
Reserve for loan losses to non-accrual loans		2.1x			1.7x			1.3x			1.3x			1.3x
Restructured loans	$	4,765		$	11,755		$	10,407		$	9,145		$	13,943
Loans past due 90 days and still accruing⁽³⁾	$	7,633		$	12,614		$	3,674		$	3,622		$	4,421
Loans past due 90 days to loans⁽²⁾		.10	%		.18	%		.05	%		.06	%		.07	%

(1)	Interim period ratios are annualized.

(2)	Excludes loans held for sale.

(3)

At June 30, 2013, loans past due 90 days and still accruing includes premium finance loans of $4.2 million. These loans are primarily secured by obligations of insurance carriers to refund premiums on cancelled insurance policies. The refund of premiums from the insurance carriers can take 180 days or longer from the cancellation date.

(4)	At June 30, 2013, OREO balance is net of $4.6 million valuation allowance.

TEXAS CAPITAL BANCSHARES, INC.

CONSOLIDATED STATEMENT OF INCOME (UNAUDITED)

(Dollars in thousands)


	2^nd Quarter 2013		1^st Quarter 2013			4^th Quarter 2012			3^rd Quarter 2012			2^nd Quarter 2012
Interest income
Interest and fees on loans	$	106,418	$	103,182		$	106,653		$	100,830		$	94,291
Securities		773		939			1,053			1,125			1,203
Federal funds sold		13		6			6			2			4
Deposits in other banks		60		52			57			54			48

Total interest income		107,264		104,179			107,769			102,011			95,546
Interest expense
Deposits		3,228		3,245			3,312			3,378			3,482
Federal funds purchased		206		212			190			268			240
Repurchase agreements		5		4			3			3			4
Other borrowings		143		213			615			607			492
Subordinated notes		1,829		1,829			1,829			208			—
Trust preferred subordinated debentures		633		634			665			692			688

Total interest expense		6,044		6,137			6,614			5,156			4,906

Net interest income		101,220		98,042			101,155			96,855			90,640
Provision for credit losses		7,000		2,000			4,500			3,000			1,000

Net interest income after provision for credit losses		94,220		96,042			96,655			93,855			89,640
Non-interest income
Service charges on deposit accounts		1,749		1,701			1,693			1,684			1,624
Trust fee income		1,269		1,241			1,260			1,216			1,232
Bank owned life insurance (BOLI) income		463		498			510			549			588
Brokered loan fees		4,778		4,744			4,978			4,839			4,128
Swap fees		981		1,652			2,093			1,397			622
Other		1,888		1,445			2,302			867			2,268

Total non-interest income		11,128		11,281			12,836			10,552			10,462
Non-interest expense
Salaries and employee benefits		45,191		33,541			31,198			31,009			30,230
Net occupancy expense		4,135		3,857			3,916			3,653			3,679
Marketing		4,074		3,972			3,980			3,472			3,174
Legal and professional		4,707		3,940			5,320			4,916			3,330
Communications and technology		3,347		3,122			3,070			2,885			2,720
Allowance and other carrying costs for OREO		482		430			1,369			552			3,812
Litigation settlement expense		—		—			4,000			—			—
Other		6,798		6,838			7,221			7,034			7,028

Total non-interest expense		68,734		55,700			60,074			53,521			53,973

Income from continuing operations before income taxes		36,614		51,623			49,417			50,886			46,129
Income tax expense		12,542		18,479			17,982			18,316			16,506

Income from continuing operations		24,072		33,144			31,435			32,570			29,623
Income (loss) from discontinued operations (after-tax)		1		(1	)		(6	)		(34	)		(1	)

Net income		24,073		33,143			31,429			32,536			29,622
Preferred stock dividends		2,438		81			—			—			—

Net income available to common shareholders	$	21,635	$	33,062		$	31,429		$	32,536		$	29,622

TEXAS CAPITAL BANCSHARES, INC.

QUARTERLY FINANCIAL SUMMARY – UNAUDITED

Consolidated Daily Average Balances, Average Yields and Rates

Continuing Operations

(Dollars in thousands)


	2^nd Quarter 2013							1^st Quarter 2013							4^th Quarter 2012							3^rd Quarter 2012							2^nd Quarter 2012
	Average Balance		Revenue/ Expense ⁽¹⁾		Yield/ Rate			Average Balance		Revenue/ Expense ⁽¹⁾		Yield/ Rate			Average Balance		Revenue/ Expense ⁽¹⁾		Yield/ Rate			Average Balance		Revenue/ Expense ⁽¹⁾		Yield/ Rate			Average Balance		Revenue/ Expense ⁽¹⁾		Yield/ Rate
Assets
Securities – Taxable	$	60,063	$	594		3.97	%	$	71,220	$	729		4.15	%	$	78,182	$	811		4.13	%	$	84,583	$	881		4.14	%	$	91,623	$	948		4.16	%
Securities – Non-taxable⁽²⁾		18,843		275		5.85	%		22,174		323		5.91	%		25,301		372		5.85	%		25,717		376		5.82	%		26,817		393		5.89	%
Federal funds sold and securities purchased under resale agreements		54,448		13		0.10	%		24,785		6		0.10	%		21,617		6		0.11	%		9,360		2		0.09	%		8,077		4		0.20	%
Deposits in other banks		91,177		60		0.26	%		78,718		52		0.27	%		69,886		57		0.32	%		64,859		54		0.33	%		60,416		48		0.32	%
Loans held for sale		2,406,246		22,440		3.74	%		2,362,646		22,641		3.89	%		2,658,092		26,440		3.96	%		2,432,027		24,433		4.00	%		2,062,449		21,087		4.11	%
Loans held for investment		7,152,323		83,978		4.71	%		6,842,766		80,541		4.77	%		6,662,817		80,213		4.79	%		6,313,263		76,397		4.81	%		5,950,913		73,204		4.95	%
Less reserve for loan losses		75,006		—		—			74,442		—		—			73,912		—		—			72,373		—		—			71,779		—		—

Loans, net of reserve		9,483,563		106,418		4.50	%		9,130,970		103,182		4.58	%		9,246,997		106,653		4.59	%		8,672,917		100,830		4.63	%		7,941,583		94,291		4.78	%

Total earning assets		9,708,094		107,360		4.44	%		9,327,867		104,292		4.53	%		9,441,983		107,899		4.55	%		8,857,436		102,143		4.59	%		8,128,516		95,684		4.73	%
Cash and other assets		402,898							401,692							427,299							399,428							394,086

Total assets	$	10,110,992						$	9,729,559						$	9,869,282						$	9,256,864						$	8,522,602

Liabilities and Stockholders’ Equity
Transaction deposits	$	1,051,199	$	233		0.09	%	$	1,003,735	$	253		0.10	%	$	941,947	$	244		0.10	%	$	803,776	$	247		0.12	%	$	694,463	$	198		0.11	%
Savings deposits		3,340,420		2,292		0.28	%		3,246,675		2,297		0.29	%		2,933,904		2,299		0.31	%		2,922,852		2,185		0.30	%		2,664,598		2,107		0.32	%
Time deposits		397,868		407		0.41	%		403,113		414		0.42	%		423,685		448		0.42	%		491,783		576		0.47	%		584,581		831		0.57	%
Deposits in foreign branches		340,713		296		0.35	%		335,265		281		0.34	%		362,580		321		0.35	%		431,412		370		0.34	%		444,478		346		0.31	%

Total interest bearing deposits		5,130,200		3,228		0.25	%		4,988,788		3,245		0.26	%		4,662,116		3,312		0.28	%		4,649,823		3,378		0.29	%		4,388,120		3,482		0.32	%
Other borrowings		727,158		354		0.20	%		1,041,573		429		0.17	%		1,725,129		808		0.19	%		1,639,953		878		0.21	%		1,428,575		736		0.21	%
Subordinated notes		111,000		1,829		6.61	%		111,000		1,829		6.68	%		111,000		1,829		6.56	%		12,065		208		6.86	%		—		—		—
Trust preferred subordinated debentures		113,406		633		2.24	%		113,406		634		2.27	%		113,406		665		2.33	%		113,406		692		2.43	%		113,406		688		2.44	%

Total interest bearing liabilities		6,081,764		6,044		0.40	%		6,254,767		6,137		0.40	%		6,611,651		6,614		0.40	%		6,415,247		5,156		0.32	%		5,930,101		4,906		0.33	%
Demand deposits		2,914,341							2,529,927							2,356,758							2,010,694							1,864,456
Other liabilities		91,608							90,538							86,308							80,810							69,076
Stockholders’ equity		1,023,279							854,327							814,565							750,113							658,969

Total liabilities and stockholders’ equity	$	10,110,992						$	9,729,559						$	9,869,282						$	9,256,864						$	8,522,602

Net interest income			$	101,316						$	98,155						$	101,285						$	96,987						$	90,778
Net interest margin						4.19	%						4.27	%						4.27	%						4.36	%						4.49	%

(1)	The loan averages include loans on which the accrual of interest has been discontinued and are stated net of unearned income.

(2)	Taxable equivalent rates used where applicable.

TEXAS CAPITAL BANCSHARES INC/TX - FORM 8-K - EX-99.1 - July 25, 2013

Attached files

TEXAS CAPITAL BANCSHARES INC/TX Reports