Texas Capital Bancshares, Inc. · NASDAQ:TCBI
Texas Capital Bancshares — Q4 2023 Earnings Presentation
16 slides from Texas Capital Bancshares's earnings presentation, Jan 18, 2024
Slide 1: Q4-2023 Earnings
Q4-2023 Earnings January 18, 2024 © 2024 Texas Capital Bank Member FDIC
Slide 2: Forward-Looking Statements
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. Thes
Slide 3: Foundational Tenants of Value Creation in Place
Foundational Tenants of Value Creation in Place Financial Investment // Re-aligning the Revenue Growth // Growing top- Building Tangible Book Value // expense base to directly support the line revenue as a result of expanded Reinvesting organically generated Priorities business and investing aggress
Slide 4: 2021 Strategic Performance Drivers
2021 Strategic Performance Drivers Where We Where We Where We Where We Started Are Going Started Are Going FY FY FY FY FY FY FY FY Income Statement 2020 2021 2022 2023 2025 Performance Metrics 2020 2021 2022 2023 2025 Investment Banking and Trading Income 2.2% 2.7% 2.9% 8.0% ~10% Return on Average A
Slide 5: Financial Performance // Income Statement
Financial Performance // Income Statement Adjusted Adjusted Adjusted Adjusted Non-GAAP Adjustments4 2022 2023 (Non-GAAP)4 (Non-GAAP)4 (Non-GAAP)4 (Non-GAAP)4 ($mm) Financial Highlights ($mm) 2022 2022 2023 2023 Q4 2022 Q4 2022 Q3 2023 Q4 2023 Q4 2023 Non-Interest Revenue 349.5 161.4 Gain on Sale of
Slide 6: Financial Performance // Balance Sheet Highlights
Financial Performance // Balance Sheet Highlights Balance Sheet Highlights ($mm) Ending Balances Q4 2022 Q3 2023 Q4 2023 QoQ YoY Q4 2022 Q3 2023 Q4 2023 QoQ YoY Assets Liabilities Cash and Equivalents 5,012 4,193 3,243 (23%) (35%) Non-Interest Bearing Deposits 9,618 9,353 7,328 (22%) (24%) Total Sec
Slide 7: Loan Portfolio Composition
Loan Portfolio Composition Commercial Loans ($bn) Commercial Real Estate Loans ($bn) Commercial loans increased $45mm $16.0 QoQ $14.0 Utilization remains in the low 50% $12.0 range consistent with recent historical averages Impact of multi-year capital recycling $10.0 $8.0 on loan balances sho
Slide 8: Deposit and Funding Composition
Deposit and Funding Composition Average Deposit Trends ($bn) Funding base continuing multi-year Q4 2023 EOP transition to target state composition $24.9 $24.2 $23.7 $23.2 $24.0 $22.4 Total deposit balances decreased $1.8 $1.5 $1.4 $1.1 $485mm or 2% YoY $1.5 $0.9 Excluding MF8, Indexed and $11.
Slide 9: Net Interest Income Sensitivity
Net Interest Income Sensitivity Net Interest Income Sensitivity – Static Balance Sheet ($mm) Standard Model Assumptions10 $1.1bn of loans, or 7% of LHI excluding 100bp & 200bp Parallel Shocks Mortgage Finance LHI are fixed $58 8.0% 6% maturing in the next 12 months 6.0% $29 $28 Loan Balances: St
Slide 10: Q4-2023 Earnings Overview
Q4-2023 Earnings Overview Net Interest Income ($mm) Net Interest Margin ($mm) $1.7 $11.2 3.26% 3.33% 3.29% ($2.9) ($2.1) $1.3 $1.4 3.13% 2.93% ($5.9) ($4.2) ($17.9) $232.1 $214.7 $247.6 $235.3 $232.0 $232.1 $214.7 Q3 2023 Loans Excl Loans Excl MF Loan MF Loan Loan Fees Investment Interest Interest B
Slide 11: Asset Quality Trends
Asset Quality Trends Allowance for Credit Loss Reserve Ratios Asset Quality Ratios ACL on Loans increased $5mm QoQ to 10.0 x NPAs/Total Assets $250 million 9.0 x 3.63% NCOs/Avg. LHI 3.29% 8.0 x 2.00% 1.74% 1.76% 1.79% 2.90% Total ACL, excl. MF8 increased to 2.79% 7.0 x 1.80% 5.7x Criticized/LHI
Slide 12: Capital Position and Trends
Capital Position and Trends Regulatory Capital Levels 2024 Target Regulatory capital ratios remain 17.70% exceptionally strong 20.00% 16.86% 16.43% 17.09% 17.07% 3.03% 2.83% 2.81% 2.83% Total capital ratio of 17.07%, in the 15.00% 2.71% 1.67% 1.61% 1.54% 1.58% 1.59% top decile of the peer group1
Slide 13: Full Year 2024 Guidance
Full Year 2024 Guidance FY 2023 Full Year 2024 Guidance Commentary Adjusted (Non-GAAP4) Guidance Forward curve14 assumes a 2024 average rate of 4.89% and an exit rate Total Revenue $1,075.5 Mid single-digit % growth of 4.25% Non-Interest Expense, Adjusted4 $737.1 Low single-digit % growth Quarterl
Slide 14: Appendix // Footnotes
Appendix // Footnotes 1. Includes service charges on deposit accounts, as well as fees related to our commercial card program, merchant transactions, and FX transactions, all of which are included in other non-interest income and totaled $2.8 million for FY 2020, $4.0 million for FY 2021, $6.1 milli
Slide 15: Non-GAAP Reconciliation // Return on Average Tangible Common Equity (ROATCE)
Non-GAAP Reconciliation // Return on Average Tangible Common Equity (ROATCE) ROATCE is a non-GAAP financial measure. ROATCE represents the measure of net income available to common shareholders as a percentage of average tangible common equity. ROATCE is used by management in assessing financial per
Slide 16: Non-GAAP Reconciliation // Adjusted Earnings & Ratios
Non-GAAP Reconciliation // Adjusted Earnings & Ratios Adjusted line items are non-GAAP financial measures that management ($M, Except per Share) Q4 2022 Q4 2023 2020 2021 2022 2023 believes aids in the discussion of results. A reconcilement of these adjusted Net Interest Income $247.6 $214.7 $851.3
Texas Capital Bancshares — Q4 2023 Earnings Presentation on 6ix