Texas Capital Bancshares, Inc. · NASDAQ:TCBI
Texas Capital Bancshares — Q3 2008 Earnings Presentation
18 slides from Texas Capital Bancshares's earnings presentation, Oct 23, 2008
Slide 1: Earnings Release October 22, 2008
Earnings Release October 22, 2008
Slide 2: Forward-looking statements
Certain matters discussed on this call may contain forward-looking statements, which are subject to risks and uncertainties. A number of factors, many of which are beyond Texas Capital Bancshares' control, could cause actual results to differ materially from future results expressed or implied by su
Slide 3: Opening Comments
Opening Comments Another good quarter of growth Some margin deterioration in Q3-2008 Successful capital raise of $55 million Much stronger capital position Proceeds to support growth Business model intact and well-positioned for future opportunities Continued potential to extend TCBI's growth strate
Slide 4: Texas Economy
Texas Economy Texas economy beginning to reflect national pressures TCBI markets continue to outperform national averages TCBI markets continue to outperform national averages TCBI markets continue to outperform national averages
Slide 5: Financial Highlights
Financial Highlights Net income and EPS Net income of $7.6 million increased 30% compared to Q2-2008; 14% decrease compared to Q3-2007 EPS of $.27 increased 23% compared to Q2-2008; 18% decrease compared to Q3-2007 Impact of $.03 related to increase in shares and customer fraud Growth in loans Held
Slide 6: Financial Review
FINANCIAL REVIEW “tpt Ran | 3348 ming Rene
Slide 7: Performance Evaluation
Performance Evaluation Performance Drivers Improved operating leverage Net interest income Slightly ahead of Q2-2008 - loan growth offset impact of 5% reduction in NIM Increase of 5% from Q3-2007 after 10% reduction in NIM Non-interest income in Q3-2008 reduced by $1 million customer fraud - problem
Slide 8: Income Statement
Income Statement (in thousands) Q3-08 Q2-08 Q1-08 Q4-07 Q3-07 Net interest income $ 38,266 $ 38,160 $ 36,599 $ 37,531 $ 36,531 Provision for loan losses 4,000 8,000 3,750 9,300 2,000 Net interest income after provision for loan losses 34,266 30,160 32,849 28,231 34,531 Non-interest income 4,885 5,95
Slide 9: Financial Summary (QTD Averages)
Financial Summary (in thousands) QTD Averages QTD Averages QTD Averages Q3 2008 Q2 2008 Q3 2007 Q3/Q2 % Change YOY % Change Loans held for investment $3,781,289 $3,597,342 $3,195,480 5% 18% Loans held for sale 288,103 246,026 150,031 17% 92% Total loans 4,069,392 3,843,368 3,345,511 6% 22% Securitie
Slide 10: Financial Summary (Period End)
Financial Summary (in thousands) Period End Period End Period End Q3 2008 Q2 2008 Q3 2007 Q3/Q2 % Change YOY % Change Loans held for investment $3,840,172 $3,704,262 $3,296,039 4% 17% Loans held for sale 343,002 328,838 118,221 4% 190% Total loans 4,183,174 4,033,100 3,414,260 4% 23% Securities 365,
Slide 11: QTD Average Balances, Yields and Rates
QTD Average Balances, Yields and Rates (in thousands) Q3 2008 Q3 2008 Q2 2008 Q2 2008 Q3 2007 Q3 2007 Avg. Bal. Yield / Rate Avg. Bal. Yield / Rate Avg. Bal. Yield / Rate Assets Securities $ 372,588 4.82% $ 404,574 4.76% $ 464,265 4.81% Fed funds sold & liquidity investments 10,555 1.88% 12,230 2.27
Slide 12: Revenue and Expense Growth
2003 2004 2005 2006 2007 Q3-2008 Non Interest Expense 48430 57340 65344 86913 98606 108277 2003 2004 2005 2006 2007 Q3-2008 Net Interest Income 53155 74742 94130 117813 140667 150700 Non Interest Income 10892 13632 12001 17042 19712 22027 Revenue and Expense Growth Operating Revenue CAGR: 23% Net In
Slide 13: Deposit and Loan Growth
2003 2004 2005 2006 2007 Q3-2008 Demand Deposits 302 398 512 514 529 561 Interest Bearing Deposits 1103 1392 1983 2555 2537 2828 Deposit and Loan Growth Loans HFI* Interest Bearing Deposits Demand Deposits * Excludes loans held for sale. Demand Deposit CAGR: 14% Total Deposit CAGR: 20% Loans Held fo
Slide 14: Loan Portfolio Statistics
Loan Portfolio Statistics Non-accrual loans Commercial 1,525 Construction 23,349 Real estate 21,121 Consumer 119 Equipment leases 465 Total non-accrual loans $ 46,579 Non-accrual loans as % of total loans 1.11% Total Loans $4,183,174 All numbers in thousands.
Slide 15: Credit Quality
Credit Quality Credit experience remains good Net charge-offs of $1.5 million in Q3-2008; $7.6 million YTD Net charge-offs represent 15 bps for the quarter; 28 bps for YTD and 28 bps for LTM NCO's related to identified problems substantially covered with allocated reserves in prior periods Increase
Slide 16: Credit Quality
Credit Quality Reserve / Loans* 1.07% .95% .77% .91% 1.20% Non-accrual loans + ORE to loans* + ORE 1.36% ..69% ..37% ..27% ..37% Reserve to non-accruals .9x 1.5x 2.3x 3.3x 3.2x Reserve to NPL .8x 1.3x 1.9x 2.2x 3.1x Net Charge-offs / Average Loans YTD 2008 2007 2006 2005 2004 * Excludes loans held f
Slide 17: Closing Comments
Closing Comments Another good quarter of growth Continued cautious economic outlook Factors impacting previous guidance Greatly increased risks related to market and industry events Lower rate environment much more difficult Intense focus on maintaining credit quality Exploit market opportunity for
Slide 18: Q & A
Q & A
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