Texas Capital Bancshares, Inc. · NASDAQ:TCBI
Texas Capital Bancshares — Q2 2013 Earnings Presentation
18 slides from Texas Capital Bancshares's earnings presentation, Jul 25, 2013
Slide 1: TCBI Q2 2013 Earnings
Exhibit 99.2 TCBI Q2 2013 Earnings
Slide 2: Forward-looking statements
Certain matters discussed on this call may contain forward-looking statements, which are subject to risks and uncertainties and are based on Texas Capital’s current estimates or expectations of future events or future results. Texas Capital is under no obligation, and expressly disclaims such obliga
Slide 3: Opening Remarks
Opening Remarks • Strong continued core earnings growth, with increased provision as a result of record growth in LHI • Required charge related to announced organizational change in Q2-2013 • Continued improvement in NPAs • Strong growth in deposits, specifically DDAs • LHS levels increased on a lin
Slide 4: Financial Review
Financial Review Net Income and EPS – Decrease in net income and EPS compared to Q1-2013 and Q2-2012, mainly as a result of the increased provision for growth, $.06 full quarter of preferred stock dividend, and charge related to organizational change Operating Leverage, Core Earnings Power & NIM – N
Slide 5: Financial Review
Financial Review Loan Growth – Broad-based growth in LHI • Record quarterly growth of $591 million, or 9%, from Q1-2013 • Period end balance $358 million over average balance for the quarter • Averages increased 5% from Q1-2013 and 20% from Q2-2012 – Average LHS balances up 2% from Q1-2013 and 17% f
Slide 6: Review of Mortgage Finance
Review of Mortgage Finance Highly profitable, sustainable business with favorable earning asset and funding profile – Strong position nationally with focus on large regional, privately owned mortgage companies; consistent with middle market position – Asset generated characterized by exceptional yie
Slide 7: Income Statement - Quarterly
Income Statement - Quarterly Q2-13 Q1-13 Q4-12 Q3-12 Q2-12 Net interest income $ 101,220 $ 98,042 $ 101,155 $ 96,855 $ 90,640 Non-interest income 11,128 11,281 12,836 10,552 10,462 Net revenue 112,348 109,323 113,991 107,407 101,102 Provision for credit losses 7,000 2,000 4,500 3,000 1,000 OREO valu
Slide 8: QTD Average Balances, Yields and Rates
QTD Average Balances, Yields and Rates (in thousands) Q2 2013 Q1 2013 Q2 2012 Avg. Bal. Yield Rate Avg. Bal. Yield Rate Avg. Bal. Yield Rate Assets Securities $ 78,906 4.42% $ 93,394 4.57% $118,440 4.55% Fed funds sold & liquidity investments 145,625 .20% 103,503 .23% 68,493 .31% Loans held for sale
Slide 9: Financial Summary
Financial Summary (in thousands) QTD Averages Q2/Q1 % YOY % Q2 2013 Q1 2013 Q2 2012 Change Change Total assets $10,110,992 $9,729,559 $8,522,602 4% 19% Loans held for investment 7,152,323 6,842,766 5,950,913 5% 20% Loans held for sale 2,406,246 2,362,646 2,062,449 2% 17% Total loans 9,558,569 9,205,
Slide 10: Financial Summary
Financial Summary (in thousands) Period End Q2/Q1 % YOY % Q2 2013 Q1 2013 Q2 2012 Change Change Total assets $10,977,990 $10,020,565 $9,144,360 10% 20% Loans held for investment 7,510,662 6,920,011 6,234,692 9% 20% Loans held for sale 2,838,234 2,577,830 2,408,032 10% 18% Total loans 10,348,896 9,49
Slide 11: Revenue and Income Growth
Revenue and Income Growth Operating Revenue CAGR: 23% ($ in thousands) Net Interest Income CAGR: 24% 500,000 Non-interest Income CAGR: 17% 450,000 Non-interest Expense CAGR: 20% $443,342 $419,919 Net Income CAGR: 40% 400,000 $335,169 350,000 300,000 $273,937 247,904 250,000 $225,951 212,961 200,000
Slide 12: EPS Growth
EPS Growth 5 Year EPS CAGR: 27% $3.50 3.01 $3.00 $2.50 $1.99 $2.00 $1.50 $1.31 $0.89 $1.00 $1.00 $0.71 $0.50 $0.00 2008 2009^ 2010 2011 2012 Q2-2013 ^Excludes $.15 effect of preferred TARP dividend during 2009. Reported EPS was $0.56. 12
Slide 13: Deposit and Loan Growth
Deposit and Loan Growth ($ in millions) Demand Deposit CAGR: 43% 9,000 Total Deposit CAGR: 21% Loans Held for Investment CAGR: 15% $7,981 8,000 $7,441 $7,511 7,000 $6,786 6,000 $5,455 $5,572 $5,556 5,000 $4,711 $4,457 $4,028 $4,121 4,000 $3,333 3,000 2,000 1,000 0 2008 2009 2010 2011 2012 Q2 2013 De
Slide 14: Loan Portfolio Statistics
Loan Portfolio Statistics Loan Collateral by Type 6/30/13 Non-accrual loans Commercial $ 17,577 Construction – Real estate 20,799 Consumer 9 Equipment leases 65 Total non-accrual loans $ 38,450 Non-accrual loans as % of loans held for investment .51% Non-accrual loans as % of total loans .37% OREO 1
Slide 15: Credit Quality
Credit Quality Improved Credit Trends – Total credit cost of $7.4 million for Q2-2013, compared to $2.1 million in Q1-2013 and $4.1 million in Q2-2012 • Provision of $7.0 million for Q2-2013 compared to $2.0 million for Q1-2013 and $1.0 million in Q2-2012 • Increase from Q1-2013 related to record gr
Slide 16: Credit Quality
Credit Quality Net Charge-offs / Average Loans 1.40% 1.20% 1.14% 1.00% 0.80% 0.60% 0.58% 0.46% 0.40% 0.20% 0.10% 0.10% 0.00% 2013 2012 2011 2010 2009 Combined reserve / 1.11% 1.15% 1.31% 1.56% 1.59% Loans* Non-accrual loans + OREO to loans* + .68% 1.06% 1.58% 3.25% 2.74% OREO Combined reserve to 2.1
Slide 17: Closing Comments
Closing Comments • Strong core earnings power, profitability and growth to continue in 2013 • Credit continues positive trend • Strong LHI pipeline and new commitments present opportunity for growth potential • LHS average balances to remain high with potential for modest growth with increased marke
Slide 18: Q&A
18 Q&A © TEXAS CAPITAL BANCSHARES, INC:
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