Texas Capital Bancshares, Inc. · NASDAQ:TCBI
Texas Capital Bancshares — Q1 2020 Earnings Presentation
14 slides from Texas Capital Bancshares's earnings presentation, Apr 22, 2020
Slide 1: Q1-2020 Earnings April 22, 2020
Q1-2020 Earnings April 22, 2020
Slide 2: Forward Looking Statements
Forward Looking Statements This communication may be deemed to include “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 regarding the financial condition, results of operations, business plans and the future performance of TCBI. These statements
Slide 3: Additional Statements: Additional Information About the Merger
Additional Statements Additional Information About the Merger and Where to Find It In connection with the proposed merger between IBTX and TCBI, IBTX filed a registration statement on Form S-4 with the SEC to register the shares of IBTX’s capital stock to be issued in connection with the merger. The
Slide 4: Texas Capital is in a Strong Position to Support Our Clients & Community
Texas Capital is in a Strong Position to Support Our Clients & Community Key Messages Balance Sheet Strength ◼ We continue to deepen our middle-market, commercial bank Capital 2007–2019 Annual Avg. Q4 2019 Q1 2020 relationships and currently have a very diversified loan portfolio 12.0% 11.1% 11.4% ◼
Slide 5: Liquidity Build and Balance Sheet Positioning
Liquidity Build and Balance Sheet Positioning Intentional Build of Liquid Assets Provides Flexibility ◼ In addition to continued execution of our core deposit Liquid Assets growth strategy, we took advantage of market opportunities in Q1-2020 to selectively add on-balance sheet liquidity at favorabl
Slide 6: Growth Outlook: Period-End Loan Composition
Loan Portfolio Growth Outlook Period-End Loan Composition 2 ◼ LHI (excluding MFLs) at quarter-end of $16.9 billion were up $381 $25.2B in balances million (2%) from Q4-2019, while average balances were down $68 million reflecting increased client activity late in the quarter ◼ Average total MFLs 1 o
Slide 7: Deposits and Fundings
Deposits and Fundings Highlights Funding Costs ◼ Ending deposits increased $656 million reflecting intentional liquidity build. Average total deposits of $27.7 billion for Q1-2020 were down $628 million (2%) from Q4-2019. ◼ Continued focus on cost-effective deposit growth with new verticals and core
Slide 8: Q1-2020 Earnings Overview: Net Interest Income, Margin, Provision
Q1-2020 Earnings Overview Net Interest Income & Margin Commentary Net Interest Margin Detail ◼ Modest contraction in net interest income driven by lower rates across the curve and continued asset mix- shift ◼ Incremental liquidity build resulted in short-term pressure on NIM ◼ Meaningful decrease in
Slide 9: Q1-2020 Earnings Overview: Non-interest Income and Expense
Q1-2020 Earnings Overview Non-interest Income Commentary Fee Income Details ◼ Both Q-o-Q and Y-o-Y decline driven primarily by net loss on sale of LHS; $13 million loss recorded Q1-2020, compared to $8 million for Q4-2019 and $1 million for Q1-2019 ◼ Lower expected LHS volumes should limit near-term
Slide 10: Mortgage Finance Commentary
Loan Portfolio Detail – Mortgage Finance Commentary MWH + MCA Annualized Interest Income ◼ Q1-2020 Mortgage Warehouse balances increased 20% year-over- year reflecting the Bank’s desire to continue capitalizing on unprecedented mortgage demand ◼ Despite economic uncertainly, the outlook for strong r
Slide 11: C&I excl. Energy & Leverage Commentary
Loan Portfolio Detail – C&I excl. Energy & Leverage Commentary ◼ Diverse, well-established C&I portfolio equally balanced between differentiated national verticals and core market offerings reflective of the relationship banking approach synonymous with TCBI since inception. As of Q1-2020, this segm
Slide 12: CRE Commentary
Loan Portfolio Detail – CRE Commentary Moderating Late Cycle Growth Thru cycle credit performance ◼ CRE managed as a line of business facilitating achievement of % Loan Growth NCO Rate concentration objectives by product and geography. Underwriting 1 1 focus on strong sponsors and developers with si
Slide 13: Energy Commentary
Loan Portfolio Detail – Energy Commentary Portfolio Management ◼ Portfolio composition remains focused on privately held or private ◼ ~70% of E&P clients are hedged 50% or more in 2020 equity backed E&P clients with an avg loan size of $17.5 million ◼ This compares favorably to the 2015-2016 downtur
Slide 14: Leveraged Lending Commentary
Loan Portfolio Detail – Leveraged Lending Commentary Portfolio Management ◼ Diversified portfolio with some exposure to industries believed to be ◼ Senior leverage typically in the 3.0x-4.0x range; leverage trends most impacted by COVID-19; others may be effected depending on relatively in line with
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