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8-K - CURRENT REPORT OF MATERIAL EVENTS OR CORPORATE CHANGES - Veritex Holdings, Inc.a15-9883_18k.htm

Exhibit 99.1

 

VERITEX HOLDINGS, INC. REPORTS FIRST QUARTER FINANCIAL RESULTS

 

Dallas, TX — April 29, 2015 — Veritex Holdings, Inc. (NASDAQ: VBTX), the holding company for Veritex Community Bank, announced the results today for the quarter ended March 31, 2015.  The Company reported net income of $1.8 million or $0.19 diluted earnings per common share, compared to $1.7 million or $0.18 diluted earnings per common share, for the quarter ended December 31, 2014 and $958,000 or $0.15 diluted earnings per common share for the quarter ended March 31, 2014.

 

Veritex Holdings, Inc. Chairman and Chief Executive Officer Malcolm Holland said, “I am very proud of our Veritex team for their focus and effort to complete another record quarter. Net income for the first quarter of 2015 increased $866,000 or 90.4% from a year ago as we continue to grow income and take advantages of efficiencies in our operating platform.”

 

Mr. Holland continued, “First quarter average loans increased $14.0 million compared to fourth quarter 2014. While loan demand continues to be strong, we had approximately $10.7 million in unexpected payoffs that reduced our loan balance expectations.    We continue to see pressure on pricing of new loans, however we believe that we can maintain net interest margin within the range we have seen over the past several quarters. Although the market is competitive, we are confident that our exceptional team of relationship bankers and excellent products and services will allow us to continue execution of our growth strategy for the remainder of 2015.”

 

Mr. Holland added, “Credit quality continues to be strong and the reduction in provision for loan loss expense for the first quarter reflects the quality of our loan portfolio. We continue to monitor current events and factors which could impact our markets and our clients, such as the fall in oil prices; however we have not observed any adverse trends as a result of the fall in oil prices in our markets at this time.”

 

Looking ahead, Mr. Holland noted, “With our demonstrated ability to grow organically together with our pending acquisition of IBT Bancorp, we believe we are well positioned in the growing Dallas-Fort Worth banking market.”

 

First Quarter 2015 Highlights

 

·                  The Company executed a definitive agreement on March 9, 2015 to acquire IBT Bancorp, Inc. (“IBT”), the parent holding company of Independent Bank of Texas (“Independent Bank”).  Independent Bank operates two banking locations in the Dallas metropolitan area. At December 31, 2014, IBT had total assets of approximately $121 million, total loans of approximately $99 million and total deposits of approximately $104 million.

 

·                  Total loans increased $115.4 million or 23.1% year-over-year to $615.5 million as of March 31, 2015.

 

·                  Deposits increased $95.6 million or 16.7% year-over-year to $668.3 million as of March 31, 2015.

 

·                  Noninterest expense (excluding acquisition expenses) for the first quarter 2015 was $4.9 million, an increase of $351,000 or 7.7% from the same period in 2014.

 

·                  Continued strong asset quality with nonperforming assets to total assets of 0.12%, net charge-offs to average loans outstanding of 0.01% and other real estate owned of $548,000 as of and for the quarter ended March 31, 2015.

 

·                  Minimal direct exposure to the energy sector as loans secured by oil and gas assets were $2.8 million as of March 31, 2015, or less than 1.0% of total loans.

 

Results of operations for the three months ended March 31, 2015

 

For the three months ended March 31, 2015, net income and net income available to common stockholders was $1.8 million, compared to net income and net income available to common stockholders of $1.7 million for the three months ended December 31, 2014 and compared to net income of $958,000 and net income available to common of $938,000 for the three months ended March 31, 2014.   Diluted earnings per common share was $0.19 for the three months ended March 31, 2015 compared to $0.18 for the three months ended December 31, 2014, and $0.15 for the three months ended March 31, 2014.

 



 

Return on average assets (“ROA”) and return on average common equity (“ROE”) for the three months ended March 31, 2015 were 0.94% and 6.45%, respectively, compared to 0.86% and 6.21% for the three months ended December 31, 2014, and 0.59% and 5.41% for the three months ended March 31, 2014.  The increase in ROA and ROE from March 31, 2014 was the result of continued growth in net income from new clients, expansion of existing client relationships, continued improvement in credit quality, and gains in efficiencies from our operating platform.  The efficiency ratio, defined as noninterest expense divided by the sum of net interest income and noninterest income, was 66.67% for the three months ended March 31, 2015 compared to 62.49% and 72.47% for the three months ended December 31, 2014 and March 31, 2014, respectively.  The increase in efficiency ratio from December 31, 2014 was the result of two less days of accrued net interest income of approximately $150,000 and inclusion of $197,000 of acquisition related expenses.  Excluding acquisition related expenses, the efficiency ratio was 64.09% for the three months ended March 31, 2015.

 

For the three months ended March 31, 2015, net interest income before provision for loan losses was $6.9 million and net interest margin was 3.82% compared to $6.8 million and 3.74% for the three months ended December 31, 2014 and $5.7 million and 3.79% for the three months ended March 31, 2014.  The net interest margin increased 0.08% from the three months ended December 31, 2014 primarily due to a shift in the mix of earning assets from low yielding interest-bearing deposits in other banks to higher yielding loans.  As a result, the yield on average earning assets for the three months ended March 31, 2015 improved to 4.24% from 4.16% for the three months ended December 31, 2014.  Yield on average loans remained flat at 4.85% compared to the three months ended December 31, 2014. The average yield of interest-bearing liabilities decreased 0.02% compared to 0.73% for the three months ended December 31, 2014. The decrease in average yield on interest-bearing liabilities from December 31, 2014 was due to the non-renewal of $4.0 million of matured certificate of deposits with average yields of 1.10% and a reduction in interest-bearing checking balances related to a large IOLTA account.

 

The net interest margin improved 0.03% from the three months ended March 31, 2014 due in part to the increase in noninterest-bearing sources of funds including noninterest-bearing deposits and the increase in stockholder’s equity largely due to our initial public offering.  Also contributing to the increase was a shift in the mix of earning assets as loans grew at a much faster rate than lower yielding investment securities and interest-bearing deposits in other banks and the decrease in cost of interest-bearing deposits. Partially offsetting these improvements, average loan yields declined 0.18% from 5.03% for the three months ended March 31, 2014 as overall market yields for loan originations and renewals were below the average yield of amortizing or paid-off loans. The average yield of interest-bearing liabilities decreased 0.06% from 0.77% for the three months ended March 31, 2014 to 0.71% for the three months ended March 31, 2015 primarily due to a decline in the average cost of money market deposits from 0.61% to 0.59% for the three months ended March 31, 2014 and March 31, 2015, respectively.  This decline was the result of a shift in the mix of deposits to brokered money market deposits with an average rate paid of 0.21%.

 

Noninterest income for the three months ended March 31, 2015 was $766,000, an increase of $110,000 or 16.8% compared to the three months ended December 31, 2014 and an increase of $196,000 or 34.4% compared to the three months ended March 31, 2014.  This increase was driven by a rise in mortgage production and corresponding increase in gains on loans held for sale as well as income from the purchase of an additional $7.0 million in bank owned life insurance. This increase was partially offset by reduced dividend income from the bi-annual Federal Reserve Bank stock dividends received in December 2014.

 

Noninterest expense was $5.1 million for the three months ended March 31, 2015 compared to $4.7 million for the three months ended December 31, 2014 and $4.5 million for the three months ended March 31, 2014 an increase of $403,000 or 8.6% and $548,000 or 12.1%, respectively. Noninterest expense includes $197,000 of acquisition expenses related to the preparation and execution of the definitive agreement to acquire IBT on March 9, 2015.  Excluding acquisition related expenses, noninterest expense for the three months ended March 31, 2015 was $4.9 million, an increase of $206,000 or 4.4% from the three months ended December 31, 2014 and an increase of $351,000 or 7.7% for the three months ended March 31, 2014. The increase from the three months ended December 31, 2014 was primarily due to an increase in employee expense of $213,000 related to annual merit increases, seasonal payroll taxes and stock grant expense.  The increase from the three months ended March 31, 2014 was primarily due to increased professional service fees and other public company-related costs during the three months ended March 31, 2015.

 

Income tax expense for the three months ended March 31, 2015 totaled $607,000, an increase of $95,000 or 18.6% compared to $512,000 for the same period in 2014 and a decrease of $186,000 or 23.5% from $793,000 for the three months ended December 31, 2014. The increase from the same period in 2014 was primarily attributable to the $961,000 increase in net operating income from $1.5 million for the three months ended March 31, 2014.  This increase was offset by a net discrete tax credit of $186,000 associated with the recognition of non-qualified stock option related deferred tax assets.  The decrease of $186,000 from the three months ended December 31, 2014 was primarily related to the net discrete tax benefit recognized in the three months ended March 31, 2015.  The Company’s estimated annual effective tax rate, before reporting the net impact of discrete items, was approximately 32.6%, 34.8%, and 31.9% for the three months ended March 31, 2015, March 31 2014 and December 31, 2014, respectively.

 



 

Financial Condition

 

Loans (excluding loans held for sale and deferred loan fees) at March 31, 2015 were $615.5 million, an increase of $12.2 million or 2.0% compared to $603.3 million at December 31, 2014, and an increase of $115.4 million or 23.1% compared to $500.1 million at March 31, 2014. This increase was primarily due to strong organic growth and successful execution of our relationship banking strategy.

 

Deposits at March 31, 2015 were $668.3 million compared to $638.7 million at December 31, 2014, and $572.7 million at March 31, 2014.  Deposits increased $29.6 million or 4.6% from December 31, 2014 primarily due to growth in money market balances. Deposits increased $95.6 million or 16.7% from March 31, 2014 primarily due to growth in money market and noninterest-bearing deposits.  Noninterest-bearing deposits were $241.7 million at March 31, 2015, $251.1 million at December 31, 2014 and $216.4 at March 31, 2014.  Noninterest-bearing deposits declined $9.4 million or 3.7% from December 31, 2014 primarily due to the seasonal nature of our clients’ business transactions during the first quarter of the year. Noninterest-bearing deposits grew $25.3 million or 11.7% compared to March 31, 2014 due to continued penetration of our target market and growth of new and existing commercial banking relationships.

 

Advances from the Federal Home Loan Bank decreased to $15.0 million at March 31, 2015 compared to $40.0 million at December 31, 2014 and $15.0 million at March 31, 2014.  The decrease in advances compared to December 31, 2014 was due to a 21-day FHLB advance offered at an interest rate of 0.10% which the bank took advantage of and, as a result, was able to reduce higher rate brokered deposits during the three months ended December 31, 2014.

 

Asset Quality

 

Nonperforming assets totaled $941,000 or 0.12% of total assets at March 31, 2015 compared to $541,000 or 0.07% at December 31, 2014 and $2.9 million or 0.44% of total assets at March 31, 2014.  The allowance for loan losses was 0.98% of total loans at March 31, 2015 compared to 0.99% of total loans at December 31, 2014 and 1.04% of total loans at March 31, 2014.

 

Other real estate owned totaled $548,000 at March 31, 2015 compared to $105,000 at December 31, 2014 and $2.8 million at March 31, 2014. The increase from December 31, 2014 was due to an impaired loan that was foreclosed upon in the first quarter 2015 and the sale of one property.  The decrease in other real estate owned from March 31, 2014 was due to the sale of four properties in the in the period from March 31, 2014 to March 31, 2015.  Nonaccrual loans were $323,000 at March 31, 2015 compared to $436,000 at December 31, 2014 and $156,000 at March 31, 2014.

 

The provision for loan losses for the three months ended March 31, 2015 was $110,000 compared to $326,000 and $252,000 for the three months ended December 31, 2014 and March 31, 2014, respectively.   The overall decrease in the provision was a result of continued improvement in credit quality.

 

Non-GAAP Financial Measures

 

The Company’s management uses certain non-GAAP (generally accepted accounting principles) financial measures to evaluate its performance. Specifically, the Company reviews tangible book value per common share and the tangible common equity to tangible assets ratio. The Company has included in this release information related to these non-GAAP financial measures for the applicable periods presented. Please refer to “Consolidated Financial Highlights” at the end of this release for a reconciliation of these non-GAAP financial measures.

 

About Veritex Holdings, Inc.

 

Headquartered in Dallas, Texas, Veritex Holdings, Inc. is a bank holding company that conducts banking activities through its wholly-owned subsidiary, Veritex Community Bank, with locations throughout the Dallas metropolitan area. Veritex Community Bank is a Texas state chartered bank regulated by the Texas Department of Banking and the Board of Governors of the Federal Reserve System.

 

For more information, visit www.veritexbank.com

 

Additional Information About the Pending Acquisition of IBT Bancorp, Inc.

 

In connection with the pending acquisition of IBT, the Company will file with the Securities and Exchange Commission a registration statement on Form S-4 to register the shares of the Company’s common stock to be issued to the shareholders of IBT as consideration in the merger. The registration statement will include a proxy statement/prospectus which will be sent to the shareholders of IBT seeking their approval of the proposed transaction.

 

WE URGE INVESTORS AND SECURITY HOLDERS TO READ THE REGISTRATION STATEMENT ON FORM S-4, THE PROXY STATEMENT/PROSPECTUS INCLUDED WITHIN THE REGISTRATION STATEMENT ON FORM S-4 AND ANY OTHER RELEVANT DOCUMENTS TO BE FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IN CONNECTION WITH THE PROPOSED TRANSACTION BECAUSE THEY CONTAIN IMPORTANT INFORMATION ABOUT THE COMPANY, IBT AND THE PROPOSED TRANSACTION.

 



 

Investors and security holders will be able to obtain free copies of the registration statement on Form S-4 and the related proxy statement/prospectus, when filed, as well as other documents filed with the Securities and Exchange Commission by the Company through the web site maintained by the Securities and Exchange Commission at www.sec.gov. Documents filed with the Securities and Exchange Commission by the Company will also be available free of charge by directing a request by phone, email or mail to Veritex Holdings, Inc., 8214 Westchester Drive, Suite 400, Dallas, Texas 75225 Attn: Investor Relations. The Company’s telephone number is (972) 349-6200.

 

“Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995: This release may contain certain forward-looking statements within the meaning of the securities laws that are based on various facts and derived utilizing important assumptions, current expectations, estimates and projections about the Company and its subsidiaries. Forward-looking statements include information regarding the Company’s future financial performance, business and growth strategy, projected plans and objectives, expectations concerning the  costs associated with the acquisition of IBT and related transactions, timing for completion of the merger, integration of the acquired business, ability to achieve the anticipated cost savings and operational efficiencies, addition of new and expanded product offerings, as well as projections of macroeconomic and industry trends, which are inherently unreliable due to the multiple factors that impact economic trends, and any such variations may be material. Statements preceded by, followed by or that otherwise include the words “believes,” “expects,” “anticipates,” “intends,” “projects,” “estimates,” “plans” and similar expressions or future or conditional verbs such as “will,” “should,” “would,” “may” and “could” are generally forward-looking in nature and not historical facts, although not all forward-looking statements include the foregoing. Further, certain factors that could affect our future results and cause actual results to differ materially from those expressed in the forward-looking statements include, but are not limited to whether the Company can: successfully implement its growth strategy, including identifying acquisition targets and consummating suitable acquisitions; continue to sustain internal growth rate; provide competitive products and services that appeal to its customers and target market; continue to have access to debt and equity capital markets; and achieve our performance goals. These and various other factors are discussed in the Company’s Final Prospectus, dated October 10, 2014,  filed pursuant to Rule 424(b)(4), the Company’s Annual Report on Form 10-K filed with the SEC on March 27, 2015,  and other reports and statements the Company has filed with the Securities and Exchange Commission. Copies of such filings for the Company are available for download free of charge from www.veritexbank.com under the Investor Relations tab.

 



 

VERITEX HOLDINGS, INC. AND SUBSIDIARY

 

Consolidated Financial Highlights (Unaudited)

 

(In thousands)

 

 

 

At and for the Three Months Ended

 

 

 

March 31,

 

December 31,

 

September 30,

 

June 30,

 

March 31,

 

 

 

2015

 

2014

 

2014

 

2014

 

2014

 

Selected Financial Data:

 

 

 

 

 

 

 

 

 

 

 

Net income

 

$

1,824

 

$

1,690

 

$

1,359

 

$

1,198

 

$

958

 

Net income available to common stockholders

 

1,804

 

1,670

 

1,339

 

1,178

 

938

 

Total assets

 

808,906

 

802,286

 

745,344

 

710,382

 

670,351

 

Total loans(1) 

 

615,495

 

603,310

 

581,338

 

540,990

 

500,091

 

Allowance for loan losses

 

6,006

 

5,981

 

5,880

 

5,516

 

5,215

 

Noninterest-bearing deposits

 

241,732

 

251,124

 

242,688

 

236,198

 

216,431

 

Total deposits

 

668,255

 

638,743

 

644,543

 

611,174

 

572,684

 

Total stockholders’ equity

 

115,133

 

113,312

 

75,603

 

74,244

 

72,706

 

Summary Performance Ratios:

 

 

 

 

 

 

 

 

 

 

 

Return on average assets(2) 

 

0.94

%

0.86

%

0.74

%

0.71

%

0.59

%

Return on average equity(2) 

 

6.45

 

6.21

 

7.16

 

6.49

 

5.41

 

Net interest margin(3) 

 

3.82

 

3.74

 

3.95

 

3.92

 

3.79

 

Efficiency ratio(4) 

 

66.67

 

62.49

 

65.87

 

65.98

 

72.47

 

Noninterest expense to average assets(2) 

 

2.61

 

2.38

 

2.63

 

2.70

 

2.77

 

Summary Credit Quality Data:

 

 

 

 

 

 

 

 

 

 

 

Nonaccrual loans

 

$

323

 

$

436

 

$

445

 

$

107

 

$

156

 

Accruing loans 90 or more days past due

 

 

 

3

 

390

 

6

 

Other real estate owned

 

548

 

105

 

1,434

 

2,494

 

2,766

 

Nonperforming assets to total assets

 

0.12

%

0.07

%

0.25

%

0.42

%

0.44

%

Nonperforming loans to total loans

 

0.05

 

0.07

 

0.08

 

0.09

 

0.03

 

Allowance for loan losses to total loans

 

0.98

 

0.99

 

1.01

 

1.02

 

1.04

 

Net charge-offs to average loans outstanding

 

0.01

 

0.04

 

0.01

 

0.02

 

0.01

 

Capital Ratios:

 

 

 

 

 

 

 

 

 

 

 

Total stockholders’ equity to total assets

 

14.23

%

14.11

%

10.14

%

10.45

%

10.85

%

Tangible common equity to tangible assets(5) 

 

11.01

 

10.86

 

6.50

 

6.62

 

6.78

 

Tier 1 capital to average assets

 

12.78

 

12.66

 

8.28

 

8.66

 

8.64

 

Tier 1 capital to risk-weighted assets

 

15.43

 

15.45

 

10.04

 

10.44

 

10.97

 

Total capital to risk-weighted assets

 

17.16

 

17.21

 

11.90

 

12.35

 

12.98

 

 


(1)         Total loans does not include loans held for sale and deferred fees.  Loans held for sale were $2.5 million at March 31, 2015, $8.9 million at December 31, 2014, $3.5 million at September 30, 2014, $6.3 million at June 30, 2014, and $2.5 million at March 31, 2014.  Deferred fees were $50,000 at March 31, 2015, $51,000 at December 31, 2014, $60,000 at September 30, 2014, $71,000 at June 30, 2014, and $81,000 at March 31, 2014.

 

(2)         We calculate our average assets and average equity for a period by dividing the sum of our total assets or total stockholders’ equity, as the case may be, at the close of business on each day in the relevant period, by the number of days in the period. We have calculated our return on average assets and return on average equity for a period by dividing net income for that period by our average assets and average equity, as the case may be, for that period.

 

(3)         Net interest margin represents net interest income, annualized on a fully tax equivalent basis, divided by average interest-earning assets.

 

(4)         Efficiency ratio represents noninterest expense divided by the sum of net interest income and noninterest income.

 

(5)         We calculate tangible common equity as total stockholders’ equity less preferred stock, goodwill, core deposit intangibles and other intangible assets, net of accumulated amortization, and we calculate tangible assets as total assets less goodwill and core deposit intangibles and other intangible assets, net of accumulated amortization. Tangible common equity to tangible assets is a non-GAAP financial measure, and, as we calculate tangible common equity to tangible assets, the most directly comparable GAAP financial measure is total stockholders’ equity to total assets. See our reconciliation of non-GAAP financial measures to their most directly comparable GAAP financial measures in the table captioned “Reconciliation GAAP —NON-GAAP (Unaudited).”

 



 

VERITEX HOLDINGS, INC. AND SUBSIDIARY

 

Condensed Consolidated Balance Sheets (Unaudited)

 

(In thousands)

 

 

 

March 31,

 

December 31,

 

September 30,

 

June 30,

 

March 31,

 

 

 

2015

 

2014

 

2014

 

2014

 

2014

 

Assets

 

 

 

 

 

 

 

 

 

 

 

Cash and due from banks

 

$

9,338

 

$

9,223

 

$

9,441

 

$

10,038

 

$

10,097

 

Interest bearing deposits in other banks

 

76,206

 

84,028

 

58,292

 

56,512

 

62,058

 

Total cash and cash equivalents

 

85,544

 

93,251

 

67,733

 

66,550

 

72,155

 

Investment securities

 

53,391

 

45,127

 

47,497

 

50,547

 

51,215

 

Loans held for sale

 

2,508

 

8,858

 

3,488

 

6,342

 

2,520

 

Loans, net

 

609,439

 

597,278

 

575,398

 

535,403

 

494,794

 

Accrued interest receivable

 

1,539

 

1,542

 

1,351

 

1,359

 

1,252

 

Bank-owned life insurance

 

17,969

 

17,822

 

10,731

 

10,647

 

10,564

 

Bank premises, furniture and equipment, net

 

11,526

 

11,150

 

11,235

 

11,303

 

9,814

 

Non-marketable equity securities

 

3,136

 

4,139

 

3,115

 

2,959

 

2,715

 

Investment in subsidiary

 

93

 

93

 

93

 

93

 

93

 

Other real estate owned

 

548

 

105

 

1,434

 

2,494

 

2,766

 

Intangible assets

 

1,186

 

1,261

 

1,337

 

1,413

 

1,490

 

Goodwill

 

19,148

 

19,148

 

19,148

 

19,148

 

19,148

 

Other assets

 

2,879

 

2,512

 

2,784

 

2,124

 

1,825

 

Total assets

 

$

808,906

 

$

802,286

 

$

745,344

 

$

710,382

 

$

670,351

 

Liabilities and Stockholders’ Equity

 

 

 

 

 

 

 

 

 

 

 

Deposits:

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing

 

$

241,732

 

$

251,124

 

$

242,688

 

$

236,198

 

$

216,431

 

Interest-bearing

 

426,523

 

387,619

 

401,855

 

374,976

 

356,253

 

Total deposits

 

668,255

 

638,743

 

644,543

 

611,174

 

572,684

 

Accounts payable and accrued expenses

 

1,049

 

1,582

 

1,327

 

1,195

 

1,352

 

Accrued interest payable and other liabilities

 

1,395

 

575

 

798

 

696

 

537

 

Advances from Federal Home Loan Bank

 

15,000

 

40,000

 

15,000

 

15,000

 

15,000

 

Other borrowings

 

8,074

 

8,074

 

8,073

 

8,073

 

8,072

 

Total liabilities

 

693,773

 

688,974

 

669,741

 

636,138

 

597,645

 

Commitments and contingencies

 

 

 

 

 

 

 

 

 

 

 

Stockholders’ equity:

 

 

 

 

 

 

 

 

 

 

 

Preferred stock

 

8,000

 

8,000

 

8,000

 

8,000

 

8,000

 

Common stock

 

95

 

95

 

64

 

64

 

64

 

Additional paid-in capital

 

97,480

 

97,469

 

61,513

 

61,419

 

61,356

 

Retained earnings

 

9,851

 

8,047

 

6,378

 

5,038

 

3,860

 

Accumulated other comprehensive income

 

178

 

172

 

119

 

194

 

(4

)

Unallocated Employee Stock Ownership Plan shares; 36,935 shares at December 31, 2014, September 30, 2014, June 30, 3014 and 46,082 shares at March 31, 2014

 

(401

)

(401

)

(401

)

(401

)

(500

)

Less: Treasury stock, 10,000 shares at cost

 

(70

)

(70

)

(70

)

(70

)

(70

)

Total stockholders’ equity

 

115,133

 

113,312

 

75,603

 

74,244

 

72,706

 

Total liabilities and stockholders’ equity

 

$

808,906

 

$

802,286

 

$

745,344

 

$

710,382

 

$

670,351

 

 



 

VERITEX HOLDINGS, INC. AND SUBSIDIARY

 

Condensed Consolidated Statements of Income (Unaudited)

 

(In thousands, except share amounts)

 

 

 

Three Months Ended

 

 

 

March 31,

 

December 31,

 

September  30,

 

June 30,

 

March 31,

 

 

 

2015

 

2014

 

2014

 

2014

 

2014

 

Interest income:

 

 

 

 

 

 

 

 

 

 

 

Interest and fees on loans

 

$

7,348

 

$

7,335

 

$

7,183

 

$

6,566

 

$

6,152

 

Interest on investment securities

 

212

 

209

 

207

 

206

 

216

 

Interest on deposits in other banks

 

54

 

63

 

43

 

40

 

36

 

Interest on other

 

 

 

1

 

1

 

1

 

Total interest income

 

7,614

 

7,607

 

7,434

 

6,813

 

6,405

 

Interest expense:

 

 

 

 

 

 

 

 

 

 

 

Interest on deposit accounts

 

631

 

652

 

609

 

570

 

587

 

Interest on borrowings

 

126

 

123

 

123

 

123

 

132

 

Total interest expense

 

757

 

775

 

732

 

693

 

719

 

Net interest income

 

6,857

 

6,832

 

6,702

 

6,120

 

5,686

 

Provision for loan losses

 

110

 

326

 

420

 

425

 

252

 

Net interest income after provision for loan losses

 

6,747

 

6,506

 

6,282

 

5,695

 

5,434

 

Noninterest income:

 

 

 

 

 

 

 

 

 

 

 

Service charges on deposit accounts

 

185

 

223

 

213

 

190

 

206

 

Gain on sales of investment securities

 

7

 

 

 

 

34

 

Gain on sales of loans held for sale

 

302

 

155

 

241

 

168

 

77

 

Gain on sales of other real estate owned

 

(2

)

6

 

(33

)

24

 

13

 

Bank-owned life insurance

 

178

 

111

 

105

 

103

 

108

 

Other

 

96

 

161

 

104

 

155

 

132

 

Total noninterest income

 

766

 

656

 

630

 

640

 

570

 

Noninterest expense:

 

 

 

 

 

 

 

 

 

 

 

Salaries and employee benefits

 

2,657

 

2,444

 

2,755

 

2,196

 

2,642

 

Occupancy of bank premises

 

526

 

445

 

497

 

474

 

446

 

Depreciation and amortization

 

325

 

334

 

338

 

334

 

333

 

Data processing

 

220

 

242

 

213

 

210

 

216

 

FDIC assessment fees

 

100

 

105

 

99

 

109

 

108

 

Legal fees

 

201

 

16

 

50

 

26

 

34

 

Other professional fees

 

237

 

279

 

222

 

411

 

132

 

Advertising and promotions

 

73

 

52

 

41

 

37

 

55

 

Utilities and telephone

 

73

 

73

 

72

 

72

 

69

 

Other real estate owned expenses and write-downs

 

13

 

24

 

53

 

108

 

26

 

Other

 

657

 

665

 

490

 

483

 

473

 

Total noninterest expense

 

5,082

 

4,679

 

4,830

 

4,460

 

4,534

 

Net income from operations

 

2,431

 

2,483

 

2,082

 

1,875

 

1,470

 

Income tax expense

 

607

 

793

 

723

 

677

 

512

 

Net income

 

$

1,824

 

$

1,690

 

$

1,359

 

$

1,198

 

$

958

 

Preferred stock dividends

 

20

 

20

 

20

 

20

 

20

 

Net income available to common stockholders

 

$

1,804

 

$

1,670

 

$

1,339

 

$

1,178

 

$

938

 

Basic earnings per share

 

$

0.19

 

$

0.18

 

$

0.21

 

$

0.19

 

$

0.15

 

Diluted earnings per share

 

$

0.19

 

$

0.18

 

$

0.21

 

$

0.18

 

$

0.15

 

Weighted average basic shares outstanding

 

9,447,706

 

9,157,582

 

6,321,897

 

6,321,193

 

6,139,867

 

Weighted average diluted shares outstanding

 

9,743,576

 

9,405,168

 

6,462,897

 

6,452,656

 

6,266,821

 

 



 

VERITEX HOLDINGS, INC. AND SUBSIDIARY

 

Reconciliation GAAP — NON GAAP (Unaudited)

 

(In thousands)

 

The following table reconciles, at the dates set forth below, total stockholders’ equity to tangible common equity and total assets to tangible assets:

 

Tangible Book Value Per Common Share

 

 

 

March 31,

 

December 31,

 

September 30,

 

June 30,

 

March 31,

 

 

 

2015

 

2014

 

2014

 

2014

 

2014

 

Tangible Common Equity

 

 

 

 

 

 

 

 

 

 

 

Total stockholders’ equity

 

$

115,133

 

$

113,312

 

$

75,603

 

$

74,244

 

72,706

 

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

Preferred stock

 

(8,000

)

(8,000

)

(8,000

)

(8,000

)

(8,000

)

Goodwill

 

(19,148

)

(19,148

)

(19,148

)

(19,148

)

(19,148

)

Intangible assets

 

(1,186

)

(1,261

)

(1,337

)

(1,413

)

(1,490

)

Total tangible common equity

 

$

86,799

 

$

84,903

 

$

47,118

 

$

45,683

 

$

44,068

 

Tangible Assets

 

 

 

 

 

 

 

 

 

 

 

Total assets

 

$

808,906

 

$

802,286

 

$

745,344

 

$

710,382

 

$

670,351

 

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

Goodwill

 

(19,148

)

(19,148

)

(19,148

)

(19,148

)

(19,148

)

Intangible assets

 

(1,186

)

(1,261

)

(1,337

)

(1,413

)

(1,490

)

Total tangible assets

 

$

788,572

 

$

781,877

 

$

724,859

 

$

689,821

 

$

649,713

 

Tangible Common Equity to Tangible Assets

 

11.01

%

10.86

%

6.50

%

6.62

%

6.78

%

Common shares outstanding

 

9,485

 

9,471

 

6,359

 

6,359

 

6,359

 

 

 

 

 

 

 

 

 

 

 

 

 

Book value per common share (1)

 

$

11.29

 

$

11.12

 

$

10.63

 

$

10.42

 

$

10.18

 

Tangible book value per common share (2)

 

9.15

 

8.96

 

7.41

 

7.18

 

6.93

 

 


(1)                                 We calculate book value per common share as stockholders’ equity less preferred stock at the end of the relevant period divided by the outstanding number of shares of our common stock at the end of the relevant period.

 

(2)                                 We calculate tangible book value per common share as total stockholders’ equity less preferred stock, goodwill, and intangible assets, net of accumulated amortization at the end of the relevant period, divided by the outstanding number of shares of our common stock at the end of the relevant period. Tangible book value per common share is a non-GAAP financial measure, and, as we calculate tangible book value per common share, the most directly comparable GAAP financial measure is total stockholders’ equity per common share.

 



 

VERITEX HOLDINGS, INC. AND SUBSIDIARY

 

Net Interest Margin (Unaudited)

 

(In thousands)

 

 

 

For the Three Months Ended

 

 

 

March 31, 2015

 

December 31, 2014

 

March 31, 2014

 

 

 

Average
Outstanding
Balance

 

Interest
Earned/
Interest
Paid

 

Average
Yield/
Rate

 

Average
Outstanding
Balance

 

Interest
Earned/
Interest
Paid

 

Average
Yield/
Rate

 

Average
Outstanding
Balance

 

Interest
Earned/
Interest
Paid

 

Average
Yield/
Rate

 

Assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-earning assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total loans(1) 

 

$

613,840

 

$

7,348

 

4.85

%

$

599,813

 

$

7,335

 

4.85

%

$

496,316

 

$

6,152

 

5.03

%

Investment securities

 

49,242

 

212

 

1. 75

 

46,750

 

209

 

1.77

 

48,719

 

216

 

1.80

 

Investment in subsidiary

 

93

 

 

 

93

 

 

 

93

 

1

 

1.07

 

Interest-bearing deposits in other banks

 

65,221

 

54

 

0.34

 

78,611

 

63

 

0.32

 

63,345

 

36

 

0.23

 

Total interest-earning assets

 

728,396

 

7,614

 

4.24

 

725,267

 

7,607

 

4.16

 

608,473

 

6,405

 

4.27

 

Allowance for loan losses

 

(6,013

)

 

 

 

 

(5,906

)

 

 

 

 

(5,134

)

 

 

 

 

Noninterest-earning assets

 

67,233

 

 

 

 

 

60,649

 

 

 

 

 

60,739

 

 

 

 

 

Total assets

 

$

789,616

 

 

 

 

 

$

780,010

 

 

 

 

 

$

664,078

 

 

 

 

 

Liabilities and Stockholders’ Equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing deposits

 

$

408,926

 

$

631

 

0.63

%

$

396,438

 

$

652

 

0.65

%

$

357,825

 

$

587

 

0.67

%

Advances from FHLB

 

16,878

 

32

 

0.77

 

18,533

 

30

 

0.64

 

15,000

 

33

 

0.89

 

Other borrowings

 

8,394

 

94

 

4.54

 

8,073

 

93

 

4.57

 

8,072

 

99

 

4.97

 

Total interest-bearing liabilities

 

434,198

 

757

 

0.71

 

423,044

 

775

 

0.73

 

380,897

 

719

 

0.77

 

Noninterest-bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing deposits

 

238,994

 

 

 

 

 

246,868

 

 

 

 

 

209,894

 

 

 

 

 

Other liabilities

 

1,820

 

 

 

 

 

2,171

 

 

 

 

 

1,431

 

 

 

 

 

Total noninterest-bearing liabilities

 

240,814

 

 

 

 

 

249,039

 

 

 

 

 

211,325

 

 

 

 

 

Stockholders’ equity

 

114,604

 

 

 

 

 

107,927

 

 

 

 

 

71,856

 

 

 

 

 

Total liabilities and stockholders’ equity

 

$

789,616

 

 

 

 

 

$

780,010

 

 

 

 

 

$

664,078

 

 

 

 

 

Net interest rate spread(2)

 

 

 

 

 

3.53

%

 

 

 

 

3.43

%

 

 

 

 

3.50

%

Net interest income

 

 

 

$

6,857

 

 

 

 

 

$

6,832

 

 

 

 

 

$

5,686

 

 

 

Net interest margin(3) 

 

 

 

 

 

3.82

%

 

 

 

 

3.74

%

 

 

 

 

3.79

%

 


(1)                  Includes average outstanding balances of loans held for sale of $4,420, $5,173 and $2,048 for the three months ended March 31, 2015, December 31, 2014, and March 31, 2014, respectively.

 

(2)         Net interest rate spread is the average yield on interest-earning assets minus the average rate on interest-bearing liabilities.

 

(3)         Net interest margin is equal to net interest income divided by average interest-earning assets.