Hilltop Holdings Inc. · NYSE:HTH
Hilltop — Q1 2019 Earnings Presentation
20 slides from Hilltop's earnings presentation, Apr 25, 2019
Slide 1: Hilltop Holdings Inc. Q1 2019 Earnings Presentation
Hilltop Holdings Inc. Q1 2019 Earnings Presentation April 2019
Slide 2: Preface: Additional Information and Forward-Looking Statements
Preface 2 Additional InformationCorporate Headquarters 2323 Victory Ave, Suite 1400 Dallas, TX 75219 Phone: 214-855-2177 www.hilltop-holdings.com Please Contact: Erik Yohe Phone: 214-525-4634 Email: eyohe@hilltop-holdings.com FORWARD-LOOKING STATEMENTS This presentation and statements made by repres
Slide 3: Investor Highlights – Q1 2019
3 Investor Highlights – Q1 2019 Value Creation and Capital Optimization • Net charge-offs (NCO) in Q1 2019 equated to $1.6 million, 10 basis point net charge-off rate5 • Non-performing loans decreased to $30.9 million, or 0.38% of total loans at March 31, 2019, compared to $34.0 million, or 0.41%, a
Slide 4: Business Results – Q1 2019
4 Business Results – Q1 2019 Pre-Tax Income vs. Prior Year ($ in millions) Business Drivers for Q1 2019 Note: The sum of the period amounts may not equal the total amounts due to rounding. Q1 2019 Q1 2018 • Banking pre-tax income of $41.6 million increased by 7% from prior year due to higher yields
Slide 5: Execution Update
5 Execution Update Enhanced Business Operations • Middle and back office cost optimization coupled with enhanced branch performance management initiatives at PrimeLending are resulting in better than expected savings • Launched Agency MBS structuring business to support best execution and improved d
Slide 6: Income Statement and Key Metrics
$ in Millions, except EPS Income Statement Q1 2018 Q4 2018 Q1 2019 Net interest income 103.4 117.7 108.9 Noninterest income 235.1 238.5 252.5 Noninterest expense 308.2 310.8 309.1 PPNR1 $30.4 $45.4 $52.3 Provision (recovery) for loan losses (1.8) 6.9 1.0 Pre-tax income $32.2 $38.5 $51.4 Income attri
Slide 7: Hilltop Holdings – Net Interest Income & Margin
7 Hilltop Holdings – Net Interest Income & Margin • Net interest income of $109 million increased $6 million, or 5%, from first quarter 2018 • First quarter 2019 loan accretion equated to $8.7 million, a decline of $1.1 million versus prior year period • NIM decreased 6 basis points versus Q4 2018,
Slide 8: Hilltop Holdings – Noninterest Income
8 Hilltop Holdings – Noninterest Income • Noninterest income of $252.5 million increased by $17.3 million compared to the first quarter 2018 • $8.4 million reduction in mortgage production income and fees driven by lower origination volumes • Securities related fees and commissions lower versus the
Slide 9: Hilltop Holdings – Noninterest Expenses
9 Hilltop Holdings – Noninterest Expenses Year-over-Year Noninterest Expense ($MM)Noninterest Expenses and Efficiency Ratio Noninterest Expense Highlights • Total compensation increased $7.3 million from prior year first quarter primarily driven by $8.3 million from leadership and personnel changes
Slide 10: Hilltop Holdings – Loans
10 Notes: The sum of the period amounts may not equal the total amounts due to rounding. (1) Annualized Gross Loan Yield contains purchased loan portfolio. Vs. Prior Quarter: (Excludes B/D Loans) Loan Mix and Yield 2.6%0.1% Total Loan Growth Ending Balance h10% vs. PY Average Balance h8% vs. PY -0.6
Slide 11: Hilltop Holdings – Asset Quality
11 Hilltop Holdings – Asset Quality Criticized Loans 2 Non-Performing Assets Note: The sum of the period amounts may not equal the total amounts due to rounding. Figures represent bank asset quality metrics only (excludes Loans HFS and Broker Dealer Margin Loans). Figures prior to Q4 2018 include bo
Slide 12: Hilltop Holdings – Deposits
12 Vs. Prior Quarter: (Total Deposits) Deposit Mix and Cost -2.8%-0.2% ($ in billions, ending balances) Notes: Noninterest-bearing deposits excludes broker-dealer sweep deposits. The sum of the period amounts may not equal the total amounts due to rounding. Hilltop Holdings – Deposits Cost of Intere
Slide 13: PlainsCapital Bank – Q1 2019 Highlights
13 PlainsCapital Bank – Q1 2019 Highlights Efficiency and NIMQ1 2019 Highlights Note: (1) Efficiency Ratio is calculated as noninterest expense divided by the sum of net interest income and noninterest income. (2) TE Net Interest Margin – Pre PAA is the taxable equivalent Net Interest Margin less th
Slide 14: PrimeLending – Q1 2019 Highlights
14 PrimeLending – Q1 2019 Highlights Mortgage Originations and Gain on SaleQ1 2019 Highlights • Origination volume of $2.4 billion in Q1 2019 declined from Q1 2018 by $513 million, or 17% • The noninterest income decrease of $9 million, or 7%, versus Q1 2018 was attributable to a decline in volume i
Slide 15: HilltopSecurities – Q1 2019 Highlights
15 HilltopSecurities – Q1 2019 Highlights • Capital Markets and Structured Finance businesses benefited from an increase in trading gains during Q1 2019 versus Q1 2018 • Favorable market conditions resulted in a 26% increase in trading volumes, improved spreads and an 8% increase in the structured f
Slide 16: National Lloyds Corporation – Q1 2019 Highlights
16 National Lloyds Corporation – Q1 2019 Highlights • Pre-tax income of $6.8 million in Q1 2019 versus pre-tax income of $4.8 million in Q1 2018 • The increase in the combined ratio during Q1 2019, compared with the same period in 2018, was primarily driven by an increase in the underwriting expense
Slide 17: 2019 Full Year Outlook
17 2019 Full Year Outlook Guidance Comments Loan Growth 4 – 6% • Full year HFI loan growth Deposit Growth 4 – 6% • Full year average deposit growth Net Interest Income 1 – 3% growth •NIM Pre PAA 3.25 + / - 3 bps • NII growth impacted by lower accretion and increasing deposit betas • Loans HFS balanc
Slide 18: Appendix
Appendix 18
Slide 19: Non-GAAP to GAAP Reconciliation and Management's Explanation of Non-GAAP Financial Measures
19 Non-GAAP to GAAP Reconciliation and Management’s Explanation of Non-GAAP Financial Measures • Hilltop Consolidated Hilltop presents measures in this presentation that are not measures of financial performance recognized by generally accepted accounting principles in the United States (“GAAP”) inc
Slide 20: Non-GAAP to GAAP Reconciliation (Continued)
20 Non-GAAP to GAAP Reconciliation and Management’s Explanation of Non-GAAP Financial Measures (Continued) • Hilltop Consolidated Tangible Common Equity is a non-GAAP financial measure. Tangible common equity is defined as our total stockholders’ equity, excluding preferred stock, reduced by goodwil