Hilltop Holdings Inc. · NYSE:HTH
Hilltop — Q3 2014 Earnings Presentation
18 slides from Hilltop's earnings presentation, Nov 4, 2014
Slide 1: Hilltop Holdings Inc. Q3 2014 Earnings Presentation
Hilltop Holdings Inc. Q3 2014 Earnings Presentation Investor Presentation | November 4, 2014
Slide 2: Preface
Preface 2 200 Crescent Court, Suite 1330 Dallas, TX 75201 Phone: (214) 855-2177 Fax: (817) 887-1687 www.hilltop-holdings.com Please contact: Isabell Novakov Phone: (214) 252-4029 Email: inovakov@plainscapital.com Corporate Headquarters Additional Information FORWARD-LOOKING STATEMENTS This presentat
Slide 3: Hilltop Holdings Q3 2014 Highlights
3 Hilltop Holdings Q3 2014 Highlights For the third quarter of 2014, net income to common stockholders for Hilltop was $23.4 million, or $0.26 earnings per diluted share Quarter results were favorable with the exception of write-downs on FNB covered OREO that decreased Hilltop’s earnings by approxim
Slide 4: Hilltop Holdings Financial Summary
4 Hilltop Holdings Financial Summary Financial Highlights Q3 2013 Q2 2014 Q3 2014 Income to Common ($000) 38,174 27,085 23,386 EPS - Diluted ($) 0.43 0.30 0.26 Book Value Per Share ($) 13.00 14.22 14.51 NIM (taxable equivalent) 4.46% 5.18% 4.38% Assets ($000) 9,093,592 9,396,448 9,180,402 Loans, Gro
Slide 5: Hilltop Holdings Net Interest Income & Margin
5 Hilltop Holdings Net Interest Income & Margin NIM contracted by 8 bps to 4.38% in Q3 2014 compared to Q3 2013 Yield on earning assets of 4.74% driven by gross loans, as average balance increased and average yield declined by 20 bps Decrease in cost of interest bearing liabilities driven by decreas
Slide 6: Hilltop Holdings Noninterest Income
6 Hilltop Holdings Noninterest Income Noninterest income was $212.1 million in Q3 2014, down 1.4% from Q3 2013 Bargain purchase gain of $12.6 million in Q3 2013 related to the FNB Transaction Net gains from the sale of loans, other mortgage production income and mortgage loan origination fees declin
Slide 7: Hilltop Holdings Noninterest Expense
7 Hilltop Holdings Noninterest Expense Total Noninterest Expense: $216.6 million Total Noninterest Expense: $254.7 million Noninterest Expense Mix 3Q13 Noninterest Expense Mix 3Q14 Comp. and Benefits 55% Loss and LAE 11% Policy Acquisition and Other Underwriting Expense 5% Occupancy and Equipment, n
Slide 8: Hilltop Holdings Balance Sheet
Hilltop Holdings Balance Sheet Loans held for sale declined $138.1 million from Q2 2014 to Q3 2014, primarily due to changes in seasonal volume Gross non-covered loans HFI increased 1.5% from Q2 2014 Gross covered loans declined by 11.1% as we continue to work through acquired FNB loans Covered OREO
Slide 9: PlainsCapital Corporation Update
9 PlainsCapital Corporation Update With one full year since the purchase and assumption of FNB by PlainsCapital Bank, management is focused on the performance of both new and existing markets To address expense platform PlainsCapital Bank is in the process of divesting 11 branches in the Rio Grande
Slide 10: PlainsCapital Bank Q3 2014 Highlights
10 PlainsCapital Bank Q3 2014 Highlights Bank’s income before taxes of $24.6 million in Q3 2014 Net interest income increased 10.9% from Q3 2013 to Q3 2014 Approximately 91% of noninterest expense increase from Q3 2013 to Q3 2014 due to FNB Transaction of which approximately 52% attributable to OREO
Slide 11: PlainsCapital Bank Loan Portfolio by Classification
PlainsCapital Bank Loan Portfolio by Classification 11 Covered PCI Loans Q3 2014 Total: $527.7 million Covered Non-PCI Loans Q3 2014 Total: $223.5 million Non-Covered PCI Loans Q3 2014 Total: $53.4 million Non-Covered Non-PCI Loans Q3 2014 Total: $3,715.5 million Note: PCI stands for Purchased Credi
Slide 12: PCI Loans at September 30, 2014
PCI Loans at September 30, 2014 12 Purchased Credit Impaired (“PCI”) loans are loans with evidence of credit quality deterioration, for which it is probable that not all contractually required payments will be collected PCI loans include covered and non-covered loans PCI loans had a total discount o
Slide 13: Non-PCI Loans at September 30, 2014
Non-PCI Loans at September 30, 2014 13 ($000) Covered Non-PCI Non-Covered Non-PCI Total Non-PCI Outstanding Balance 239,521 3,742,721 3,982,242 (Discount) (15,994) (27,261) (43,255) Carrying Amount 223,527 3,715,460 3,938,987 Allowance for Loan Loss 89 33,739 33,828 Total Non-PCI Loans, Net of Allow
Slide 14: PrimeLending Q3 2014 Highlights
PrimeLending Q3 2014 Highlights Income before taxes of $11.1 million in Q3 2014 Summary Results ($000) Q3 2013 Q3 2014 increased year over year primarily due to lower net Net Interest Expense 8,880 3,197 interest expense, higher fee income, and flat expenses Provision for Loan Losses -- -- Originati
Slide 15: First Southwest Q3 2014 Highlights
15 First Southwest Q3 2014 Highlights Pre-tax income of $1.2 million in Q3 2014 versus $176 thousand pre-tax income in Q3 2013 Noninterest income increase of $4.0 million due largely to growth in TBA business and modest improvement in public finance Noninterest expense increase of $3.6 million, main
Slide 16: National Lloyds Corporation Q3 2014 Highlights
16 National Lloyds Corporation Q3 2014 Highlights Pre-tax income of $8.2 million for Q3 2014, up $3.8 million compared to Q3 2013 Positive results primarily due to growth in earned premium and improved claims loss experience associated with the significant decline in severity of severe weather-relat
Slide 17: SWS Transaction Pro Forma Balance Sheet Highlights
17 SWS Transaction Pro Forma Balance Sheet Highlights (6/30/14) $bn HTH SWS Pro Forma Loans HFI $4.5 $0.9 $5.4 Assets $9.4 $4.1 $13.3 Deposits $6.2 $1.4 $7.5 Equity $1.4 $0.3 $1.6 Combination Opportunity Transaction creates the largest full service brokerage firm headquartered in the Southwestern US
Slide 18: Questions?
Questions? a I I