Hilltop Holdings Inc. · NYSE:HTH
Hilltop — Q4 2020 Earnings Presentation
20 slides from Hilltop's earnings presentation, Jan 28, 2021
Slide 1: Q4 2020 Hilltop Holdings Inc. Earnings Presentation
Q4 2020 Hilltop Holdings Inc. Earnings Presentation January 2021
Slide 2: Preface: Additional Information and Forward-Looking Statements
Preface 2 Additional Information Corporate Headquarters 6565 Hillcrest Ave Dallas, TX 75205 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 representatives
Slide 3: Investor Highlights
3 Investor Highlights – ROAA1 ..86% EPS – Diluted1 ROAE1 5.76% Notes: (1) Results are presented on a consolidated basis. (2) Loans HFI reflect loans held for investment excluding margin loans from the broker-dealer business. (3) For a reconciliation of tangible book value per share to book value per
Slide 4: Business Results – Pre-Tax Income vs. Prior Year Period
Q 4 20 20 $59.2 $84.0 $34.3 ($21.1) $156.4 $41.3 $8.5 $24.2 ($14.2) $59.8 Banking Mortgage Broker-Dealer Corporate / Other Hilltop Holdings Hilltop Holdings Investor Deck Investor Highlights Slide 6/30/2020 Current Period X Pre-Tax Income Q1 2019 Q2 2019 Q3 2019 Q4 2019 YR 2019 Net Income 57.8 EPS -
Slide 5: Platform for Growth and Efficiency Update
5 Platform for Growth and Efficiency Update PPNR 2018 - 2020 Executed Programs Enhanced Business Operations • PrimeLending staff reorganization • Bank branch optimization • Leadership succession • Core system replacements • Addition of agency MBS group Strategic Sourcing • IT hardware procurement •
Slide 6: Income Statement and Key Metrics
$ in Millions, except EPS Income Statement Q4 2019 Q3 2020 Q4 2020 FY 2019 FY 2020 Net interest income $110.8 $101.9 $107.4 $439.0 $424.2 Noninterest income 263.6 502.7 447.9 1,062.8 1,690.5 Noninterest expense 307.9 399.3 402.3 1,211.9 1,453.8 PPNR1 $66.5 $205.3 $153.0 $289.9 $660.8 Provision for (
Slide 7: CECL Reserve Build on Loans HFI
$61.1 $12.6 $73.7 ( $18.5 ) $22.6 $77.4 $155.2 ( $2.7 )( $2.4 )( $1.1 ) $149.0 12/31/2019 CECL Adoption Impact 1/1/2020 Net Charge-Offs Specific Reserves Collective Reserves 9/30/2020 Net Charge-Offs Specific Reserves Collective Reserves 12/31/2020 Chart Title 7 Hilltop Holdings – CECL Reserve Build
Slide 8: Net Interest Income & Margin
Q3 2020 2.56% PPP Loans 13 Cash Decrease 10 Loans HFS (7 ) Investments (5) Core Deposits / Other 4 Q4 2020 2.7 1% $13.4 $13.1 $15.0 $15.8 $15.7 3.30% 3.41% 2.80% 2.56% 2.71% -10.00% -8.00% -6.00% -4.00% -2.00% 0.00% 2.00% 4.00% 6.00% $5.0 $7.0 $9.0 $11.0 $13.0 $15.0 $17.0 $19.0 Q4 2019 Q1 2020 Q2 20
Slide 9: Noninterest Income
$263.6 $271.7 $468.1 $502.7 $447.9 70.4% 71.1% 81.7% 83.1% 80.7% Q4 2019 Q1 2020 Q2 2020 Q3 2020 Q4 2020 Noninterest Income Fee Income Ratio 9 Hilltop Holdings – Noninterest Income • Q4 2020 noninterest income increased by $184.3 million, or 70%, compared to Q4 2019 • $140.0 million increase in mort
Slide 10: Noninterest Expenses and Efficiency Ratio
$201.2 $191.6 $204.0 $222.3 $225.3 $106.7 $90.3 $166.2 $177.0 $177.0 $307.9 $281.9 $370.2 $399.3 $402.3 82.2% 7 3.8% 64.6% 66.0% 7 2.5% Q4 2019 Q1 2020 Q2 2020 Q3 2020 Q4 2020 Variable Compensation Expenses Other Than Variable Compensation Efficiency Ratio 10 Hilltop Holdings – Noninterest Expenses
Slide 11: Loan Mix and Yield
Q4 2019 Q1 2020 Q3 2020 5.24% 5.23% 4.50% 4.32% 4.62% $6.8 $6.8 $6.8 $6.8 $6.8 $0.6 $0.5 $0.4 $0.5 $0.4 $ 0.7 $ 0.7 $ 0.5 $7 .4 $7 .3 $7 .3 $7 .3 $7 .8 $7 .7 $7 .9 $7 .7 $7 .7 $7 .7 11 Notes: The sum of the period amounts may not equal the total amounts due to rounding. (1) Annualized Gross Loan Yie
Slide 12: Modified Loan Portfolio Update
12 Hilltop Holdings – Modified Loan Portfolio Update • The outstanding balance of active modifications related to COVID-19 impacted loans has declined 75% since June 30, 2020 • Of the currently active modifications, $106 million are scheduled to return to full payment by January 31, 2021 and approxi
Slide 13: Asset Quality
13 Hilltop Holdings – Asset Quality Criticized Loans 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). (1) Total NPAs included non-accrual l
Slide 14: Deposit Mix and Cost
$5.0 $5.6 $6.9 $6.8 $6.9 $2.8 $2.9 $3.5 $3.6 $3.6 $1 .3 $1 .5 $1 .3 $0.9 $0.7 $9.0 $8.9 $9.9 $9.0 $11.6 $11.2 $11.3 $11.4 $11.2 $11.2 Q4 2019 Q1 2020 Q3 2020 Q4 2020 Q2 2020 1.14% 0.97% 0.61% 0.54% 0.49% 14 Vs. Prior Quarter: (Total Deposits) Deposit Mix and Cost (0.2%) 3.5% ($ in billions, ending a
Slide 15: PlainsCapital Bank – Highlights
Key Highlights Q4 2019 Q4 2020 FY 2019 FY 2020 ROAA 1 .1 7 % 1 .37 % 1 .36% 0.63% Efficiency Ratio1 54.9% 53.0% 55.0% 53.8% Net Interest Margin 3.7 7 % 3.37 % 4.00% 3.31 % Assets ($bn) $1 1 .1 $1 3.3 $1 1 .1 $1 3.3 Summary Results ($ in millions) Q4 2019 Q4 2020 FY 2019 FY 2020 Net Interest Income 9
Slide 16: PrimeLending – Highlights
Key Highlights Q4 2019 Q4 2020 FY 2019 FY 2020 Origination Volume ($mm) $4,401 $6,7 98 $1 5,57 9 $22,97 0 % Purchase 67 % 54% 7 5% 58% Sales Volume ($mm) $4,226 $6,57 1 $1 4,592 $22,51 4 MSR Asset ($mm) $56 $1 44 $56 $1 44 $4.4 $3.6 $6.1 $6.5 $6.8 304 325 368 440 448 -300 -200 -100 0 100 200 300 400
Slide 17: HilltopSecurities – Highlights
Q 4 20 20 Summary Results ($ in millions) Q4 2019 Q4 2020 FY 2019 FY 2020 Net Interest Income 13.3 8.9 51.3 39.9 Provision (recovery) for Loan Losses 0.0 0.1 (0.1) 0.2 Noninterest Income 99.8 141.2 404.4 491.4 Noninterest Expense 88.9 115.7 366.0 415.5 Income Before Taxes $24.2 $34.3 $89.8 $115.6 17
Slide 18: 2021 Commentary
18 Hilltop Holdings – 2021 Commentary Comments (Continuing Operations) Loan Growth (FY Average Loans HFI Growth) • Expecting 0% – 3% growth in Commercial loans, excluding PPP • Expecting $200 – $300 million of volume in round 2 of PPP Deposit Growth (FY Average Deposit Growth) • Customer deposits ex
Slide 19: Appendix
Appendix top RP
Slide 20: Reconciliation of Tangible Common Equity and Tangible Book Value Per Share
Reconciliation of Tangible Common Equity and Tangible Book Value Per Share ($ '000, except per share amounts) 12/31/2019 9/30/2020 12/31/2020 Total Stockholders' Equity 2,103,039 2,411,372 2,323,939 Less: Preferred Stock 0 0 0 Common Stockholders' Equity 2,103,039 2,411,372 2,323,939 Less: Goodwill