Hilltop Holdings Inc. · NYSE:HTH
Hilltop — Q3 2023 Earnings Presentation
20 slides from Hilltop's earnings presentation, Oct 20, 2023
Slide 1: Hilltop Holdings Inc. Q3 2023 Earnings Presentation
Hilltop Holdings Inc. Q3 2023 Earnings Presentation October 20, 2023
Slide 2: Preface
Preface Corporate Headquarters Additional Information 6565 Hillcrest Ave Please Contact: Dallas, TX 75205 Erik Yohe Phone: 214-855-2177 Phone: 214-525-4634 www.hilltop-holdings.com Email: eyohe@hilltop-holdings.com FORWARD-LOOKING STATEMENTS This presentation and statements made by representatives o
Slide 3: Investor Highlights – Q3 2023
Investor Highlights – Q3 2023 Net Income EPS – Diluted ROAA ROAE $37.0 MM $0.57 $0.30 0.94% .86% 7.11% 5.76% • PlainsCapital Bank generated $53.2 million in pre-tax income during Q3 2023, a decrease of $10.5 million from Q3 2022 driven primarily by an $11.9 million decrease in net interest income •
Slide 4: Capital Highlights – Q3 2023
Capital Highlights – Q3 2023 • During the quarter, HTH returned $10.4 million of capital to stockholders in dividends. There were no share repurchases during the quarter Capital Management and Tangible Book Value Growth $44.00 21.28% 21.22% 21.27% 18.60% $39.00 18.23% 17.99% 17.24% 17.45% 17.61% $0.
Slide 5: Q3 Financial Summary
Hilltop Holdings – Q3 Financial Summary $ in Millions, except EPS Income Statement and Key Metrics Q3 2023 Q2 2023 QoQ% Q3 2022 YoY% Net interest income $115.7 $118.3 (2%) $123.5 (6%) Noninterest income 196.8 190.7 3% 207.0 (5%) Noninterest expenses 260.0 267.0 (3%) 288.7 (10%) Efficiency ratio 83.2
Slide 6: Allowance for Credit Losses
Hilltop Holdings – Allowance for Credit Losses Allowance for Credit Losses at Period End ($ in millions) $115.0 4.00% $109.3 $1.6 $110.8 $2.4 $0.2 3.50% $105.0 ($2.7) $95.4 $97.4 3.00% ACL / Total Loans HFI $95.0 $91.8 2.50% $85.0 2.00% 1.35% 1.50% $75.0 1.31% 1.16% 1.19% 1.18% 1.00% $65.0 0.50% $55
Slide 7: Commercial Real Estate Portfolio
Hilltop Holdings – Commercial Real Estate Portfolio Commercial Real Estate Portfolio Commercial Real Estate – Non-Owner Occupied (Ending Balance at Sept 30, 2023) (Ending Balance at Sept 30, 2023) CRE Allowance for Credit Losses (ACL) (Ending Balance at Sept 30, 2023) Allowance for $ in m illions En
Slide 8: Net Interest Income & Margin
Hilltop Holdings – Net Interest Income & Margin Net Interest Income Net Interest Margin Roll forward ($ in millions) $130.0 Q2 2023 3.03%2 $123.5 $123.4 Loans HFI Yield Increase 0.14% $121.7 $125 .0 $120.0 $118.3 Decline in Borrowings Balance 0.10% $115.7 $115 .0 Securities Portfolio Yield Increase
Slide 9: Q3 2023 Liquidity Update
Hilltop Holdings – Q3 2023 Liquidity Update Available Liquidity1 Current Themes ($ in millions, at period end) • Available liquidity totaled ~$7.5 billion at September 30, 2023 FHLB Capacity 4,3 87 Inv estm ent Portfolio (av ailable) 1 ,588 • Total uninsured deposits were $4.4 billion, or approximat
Slide 10: Deposits
Hilltop Holdings – Deposits Deposit Mix at Period End Key Drivers & Statistics ($ in billions) Q3'22 Q2'23 Q3'23 Av erage Deposits ($B) $1 1 .7 $1 1 .3 $1 1 .2 1 $11.4 Cost of Interest-Bearing Deposits 0.7 0% 2.84% 3 .23 % $11.3 $11.2 $11.1 $11.1 1 $ 0.7 $0.4 Cost of Total Deposits 0.43 % 1 .95% 2.2
Slide 11: Noninterest Income
Hilltop Holdings – Noninterest Income Noninterest Income Year-over-Year Noninterest Income ($MM) ($ in millions) Q3 2022 $207 .0 Mortgage Production Income & Fees (9.2) Securities and Inv estment Adv isory Fees & Commissions (1.4) $207.0 Other Income 0.5 $196.8 $1 2 .2 $190.7 Q3 2023 $196.8 $1 1 .7
Slide 12: Noninterest Expenses
Hilltop Holdings – Noninterest Expenses Noninterest Expenses Year-over-Year Noninterest Expense ($MM) ($ in millions) 0. 0 $40 90.0% Q3 2022 $ 288.7 88.1 % 87 .4% Com pensation and Benefits (2 7 .3 ) 86.4% 86.4% 0.0 $35 Occupancy and Equipm ent (3 .1 ) 83.2% 85.0% Professional Serv ices 2 .0 0. 0 $3
Slide 13: Loans
Hilltop Holdings – Loans Loan Mix at Period End Key Drivers & Statistics ($ in billions) $ 8.4 $ 8.1 $ 8.2 $ 8.2 Q3'22 Q2'23 Q3'23 $ 7 .9 $ 0.3 $ 0.2 $ 0.2 $ 0.2 $ 0.2 Av erage Loans HFI Balance ($B) $7 .9 $8.0 $8.0 $ 1.4 $ 1.4 $ 1.4 Annualized Loan HFI Yield % 4 .7 5% 6 .2 1 % 6 .3 1 % $ 1.2 $ 1.3
Slide 14: Asset Quality
Hilltop Holdings – Asset Quality Criticized Loans Non-Performing Assets ($MM) $75,000 1.00% 5.0% 0.75% 4.0% $50,000 3.4% 0.53% % of Bank Loans 3.0% 0.4% 0.48% 0.47% 3.0% 2.7 % 2.6% 2.7 % 0.43% 0.50% 0.39% 2.0% $25,000 3.0% 3.0% 0.25% 2.6% 2.6% 2.7 % 1.0% $36,260 $32,645 $30,580 $42,437 $36,884 0.0%
Slide 15: 2023 Outlook
Hilltop Holdings – 2023 Outlook Outlook • Full year average bank loan growth 2% – 4% (excluding retained mortgages from Loan Growth PrimeLending and mortgage warehouse lending) (Full year average HFI loan growth) • Expect to retain $0 – $20 million per quarter of mortgages from PrimeLending Deposit
Slide 16: Appendix
Appendix 16
Slide 17: PlainsCapital Bank – Q3 2023 Highlights
PlainsCapital Bank – Q3 2023 Highlights Summary Results ($ in millions) Q3 2022 Q3 2023 Key Highlights Q3 2022 Q3 2023 Net Interest Incom e $1 1 0.9 $99.0 ROAA 1 .41 % 1 .20% Prov ision for (rev ersal of) Credit Losses (0.7 ) 0.7 Full Serv ice Branches (period end) 59 59 Noninterest Incom e 1 2.2 1
Slide 18: PrimeLending – Q3 2023 Highlights
PrimeLending – Q3 2023 Highlights Summary Results ($ in millions) Q3 2022 Q3 2023 Key Highlights Q3 2022 Q3 2023 Net Interest Incom e (Expense) ($2 .9) ($5.5) Origination Volum e ($m m ) $3 ,043 $2 ,2 44 Noninterest Incom e 98.2 88.7 % Purchase 93 % 93 % Noninterest Expense 1 1 8.3 91 .5 Sales Volum
Slide 19: HilltopSecurities – Q3 2023 Highlights
HilltopSecurities – Q3 2023 Highlights Summary Results Key Highlights ($ in millions) Q3 2022 Q3 2023 ($ in millions) Q3 2022 Q3 2023 Net Interest Incom e $1 3 .4 $1 2 .2 Compensation/Net Revenue (%) 61.5% 58.9% Prov ision for (Rev ersal of) Credit Losses (0.1 ) (0.7 ) Pre-tax Margin % 15.3% 18.2% N
Slide 20: Non-GAAP to GAAP Reconciliation and Management's Explanation of Non-GAAP Financial Measures
Non-GAAP to GAAP Reconciliation and Management’s Explanation of Non-GAAP Financial Measures Tangible Common Equity, is a non-GAAP financial measure. Tangible common equity is defined as our total stockholders’ equity, excluding preferred stock, reduced by goodwill and other intangible assets. This i