Texas Capital Bancshares, Inc. · NASDAQ:TCBI
Texas Capital Bancshares — Non-Deal Roadshow (June 2018)
19 slides from Texas Capital Bancshares's roadshow presentation, Jun 18, 2018
Slide 1: RBC Non-Deal Roadshow June 18-19, 2018
RBC Non-Deal Roadshow June 18 – 19, 2018 Keith Cargill, President & CEO Julie Anderson, CFO Heather Worley, SVP & Director of Investor Relations
Slide 2: Forward-looking statements
Certain matters discussed within or in connection with these materials may contain “forward-looking statements” as defined in federal securities laws, which are subject to risks and uncertainties and are based on Texas Capital’s current estimates or expectations of future events or future results. T
Slide 3: Opening Remarks & Financial Highlights
Opening Remarks & Financial Highlights • Solid traditional LHI growth in Q1-2018 • Expected seasonal contraction in Mortgage Finance balances Balanced Growth • Seasonal impact on deposits, driving lower liquidity levels in Q1-2018 • Benefit from improving yields on strong base of traditional LHI Cor
Slide 4: Overview and Strategy
Overview and Strategy Texas Capital is a commercially-focused bank operating in the five largest MSAs in Texas and throughout the U.S. • All five Texas markets highly ranked in U.S. in terms of job and economic growth, now with major business relocations to Texas • Substantial commercial businesses
Slide 5: Energy and Retail Update
Energy and Retail Update Energy Exposure • Outstanding energy loans represented 7% of total loans, or $1.4 billion, at Q1-2018 compared to $1.3 billion at Q4-2017 • Addition of new loans improves composition and quality of total portfolio as problem assets are resolved • Strong reserve position rela
Slide 6: Update on Geographic Diversification
6 Update on Geographic Diversification Note: Note: (1) Texas Regions loan balances include balances from the Energy business (2) Unemployment data through February 28, 2 $ Millions 10,000 12,000 14,000 2,000 4,000 6,000 8,000 - Texas Regions 9,866 Loans (1) 6,547 Deposits National Businesses 11,654
Slide 7: Net Interest Income & Margin
Net Interest Income & Margin Earning Asset & Margin Trends Quarterly Change $25.0 9.00% NII ($MM) NIM (%) $3.2 $210.6 Q4 2017 3.47% $2.7 $2.6 8.00% 9.1 Increase in LHI yields .16 $2.5 $21.1 $20.0 $20.5 3.8 Mix shift from MF to LHI .07 $20.1 7.00% $3.6 2.4 Increase in MF loan yields .04 $18.2 - Decre
Slide 8: Loan Growth
Loan Growth Average Balance Trends ($B) Total Loan Composition ($21.5Billion at 3/31/18) $22.0 20.00% $20.0 $6.2 Business Assets $5.9 $5.3 30% $18.0 $4.7 15.00% Energy 5% $16.0 $3.8 $15.4 $14.0 $15.0 Highly Liquid $14.4 10.00% Unsecured Assets $13.7 3% $12.0 $13.0 2% Owner Occupied $10.0 4.92% 4.89%
Slide 9: Deposit Growth
Deposit Growth Average Balance Trends ($B) Funding Costs 1.00% $22.0 $20.0 $9.1 0.80% $18.0 $8.8 $8.1 0.74% $16.0 $7.9 $7.5 0.62% $14.0 0.60% 0.56% 0.66% $12.0 0.48% 0.53% $10.0 $11.4 $11.3 0.40% $10.3 0.40% 0.47% $9.4 $9.4 Deposit Balances ($B) Balances Deposit $8.0 0.38% $6.0 0.32% 0.20% $4.0 $2.0
Slide 10: Non-interest Expense
Non-interest Expense Quarterly Change NIE - Efficiency Increase/ • Changes in Salaries & Benefits components of change Non-interest expense ($MM) (Decrease) • Reduction of 123R expense Q4 2017 $133.1 • Annual incentive accrual ramps throughout the Salaries and employee benefits – FAS 123R year and g
Slide 11: Asset Quality
Asset Quality Non-accrual loans Q1 2018 NCO / Average Traditional LHI 1.40% Commercial $ 122,283 Construction – 1.20% Real estate 1,187 1.00% Consumer 72 0.80% Equipment leases – 0.60% 0.38% Total non-accrual loans $ 123,542 0.40% 0.21% 0.20% 0.14% 0.07% 0.10% Non-accrual loans as % of LHI .78% 0.00
Slide 12: Performance Summary - Quarterly
Performance Summary - Quarterly (in thousands) Q1 2018 Q4 2017 Q3 2017 Q2 2017 Q1 2017 Net interest income $ 210,300 $ 210,649 $ 204,361 $ 182,959 $ 163,359 Non-interest income 19,947 19,374 19,003 18,769 17,110 Net revenue 230,247 230,023 223,364 201,728 180,469 Provision for credit losses 12,000 2
Slide 13: 2018 Outlook
2018 Outlook Business 2018 Outlook v. 2017 Results Comments & Changes since April 18, Driver 2018 Average LHI Low to mid-teens percent growth - Average LHI – Low- to mid-single digit percent growth; Q2-2018 Updated to provide range for Q2-2018 average Mortgage Finance average $4.7 - $4.8 billion bal
Slide 14: Closing Comments
Closing Comments • Strong earnings in Q1-2018 despite impact of seasonality • Continued traditional LHI growth in Q1-2018 • Expected seasonal declines in Mortgage Finance asset balances • Q1-2018 deposit levels impacted by seasonality resulting in more effective utilization of liquidity • High asset
Slide 15: Q&A
Q&A @© Texas CAPITAL BANCSHARES, INC?
Slide 16: Appendix
Appendix @© Texas CAPITAL BANCSHARES, INC?
Slide 17: Average Balances, Yields & Rates - Quarterly
Average Balances, Yields & Rates - Quarterly (in thousands) Q1 2018 Q4 2017 Q1 2017 Avg. Bal. Yield Rate Avg. Bal. Yield Rate Avg. Bal. Yield Rate Assets Securities $ 23,854 3.50% $ 23,678 3.57% $ 32,129 2.86% Liquidity assets 2,564,579 1.55% 3,217,486 1.28% 3,589,166 .80% Loans held for sale 1,187,
Slide 18: Average Balance Sheet - Quarterly
Average Balance Sheet - Quarterly (in thousands) QTD Average Q1/Q4 % YOY % Q1 2018 Q4 2017 Q1 2017 Change Change Total assets $23,912,613 $25,080,825 $20,861,171 (5)% 15% Loans held for sale 1,187,594 1,144,124 1,064,322 4% 12% Loans held for investment 15,425,323 15,010,041 12,980,544 3% 19% Loans
Slide 19: Period End Balance Sheet
Period End Balance Sheet (in thousands) Period End Q1/Q4 % YOY % Q1 2018 Q4 2017 Q1 2017 Change Change Total assets $24,449,147 $25,075,645 $20,864,874 (2)% 17% Loans held for sale 1,088,565 1,011,004 884,647 8% 23% Loans held for investment 15,741,772 15,366,252 13,298,918 2% 18% Loans held for inv
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