Texas Capital Bancshares, Inc. Announces Second Quarter 2022 Results

Dallas, Texas, UNITED STATES


Second quarter 2022 net income of $34.2 million and net income available to common
stockholders of $29.8 million, or $0.59 per diluted share

Pre-Provision Net Revenue(1) grew $16.7 million (33%) linked quarter

Total loans held for investment increased $2.4 billion (11%) linked quarter

DALLAS, July 21, 2022 (GLOBE NEWSWIRE) -- Texas Capital Bancshares, Inc. (NASDAQ: TCBI), the parent company of Texas Capital Bank, announced operating results for the second quarter of 2022.

Net income available to common stockholders was $29.8 million, or $0.59 per diluted share, for the second quarter of 2022, compared to $35.3 million, or $0.69 per diluted share, for the first quarter of 2022 and $67.2 million, or $1.31 per diluted share, for the second quarter of 2021.

“We continue to execute on our strategic vision laid out nearly eleven months ago and are pleased with the early progress evidenced by strong revenue growth in our second quarter results,” said Rob C. Holmes, President and CEO. “The launch of our sales and trading platform in early May, and the restructuring and significant investment in C&I, demonstrate our commitment to delivering a full-service offering worthy of banking premier clients in our markets.”

FINANCIAL RESULTS     
(dollars and shares in thousands)     
 2nd Quarter 1st Quarter 2nd Quarter
  2022   2022   2021 
OPERATING RESULTS     
Net income$34,159  $39,650  $73,481 
Net income available to common stockholders$29,847  $35,337  $67,164 
Diluted earnings per common share$0.59  $0.69  $1.31 
Diluted common shares 50,802   51,324   51,094 
Return on average assets 0.44%  0.47%  0.76%
Return on average common equity 4.35%  4.97%  9.74%
      
BALANCE SHEET     
Loans held for investment$17,517,866  $15,849,434  $15,168,565 
Loans held for investment, mortgage finance 6,549,507   5,827,965   8,772,799 
Total loans held for investment 24,067,373   21,677,399   23,941,364 
Loans held for sale 4,266   8,085   63,747 
Total assets 32,338,963   31,085,377   35,228,542 
Non-interest bearing deposits 12,555,367   13,434,723   14,228,038 
Total deposits 25,440,021   25,377,938   28,839,563 
Stockholders’ equity 3,006,832   3,090,038   3,114,957 


 

(1)     Net interest income and non-interest income, less non-interest expense.

SECOND QUARTER 2022 COMPARED TO FIRST QUARTER 2022

For the second quarter of 2022, net income available to common stockholders was $29.8 million, or $0.59 per diluted share, compared to $35.3 million, or $0.69 per diluted share, for the first quarter of 2022.

We recorded a $22.0 million provision for credit losses for the second quarter of 2022, compared to a $2.0 million negative provision for credit losses for the first quarter of 2022. The $22.0 million provision for credit losses recorded in the second quarter of 2022 resulted primarily from an increase in total loans held for investment (“LHI”).

Net interest income was $205.5 million for the second quarter of 2022, compared to $183.5 million for the first quarter of 2022. The increase in net interest income was primarily driven by increases in total LHI average balances and yields, partially offset by an increase in yields on deposits and short-term borrowings. Net interest margin for the second quarter of 2022 was 2.68%, an increase of 45 basis point from the first quarter of 2022. LHI, excluding mortgage finance, yields increased 34 basis points from the first quarter of 2022 and LHI, mortgage finance yields increased 35 basis points from the first quarter of 2022. Total cost of deposits was 0.33% for the second quarter of 2022, a 13 basis point increase from the first quarter of 2022.

Non-interest income for the second quarter of 2022 increased $6.0 million, or 29%, compared to the first quarter of 2022, primarily due to increases in investment banking and trading income.

Non-interest expense for the second quarter of 2022 increased $11.2 million, or 7%, compared to the first quarter of 2022. The increase was primarily due to increases in salaries and benefits expense, resulting from an increase in headcount and marketing expense.

SECOND QUARTER 2022 COMPARED TO SECOND QUARTER 2021

Net income available to common stockholders was $29.8 million, or $0.59 per diluted share, for the second quarter of 2022, compared to $67.2 million, or $1.31 per diluted share, for the second quarter of 2021.

The second quarter of 2022 included a $22.0 million provision for credit losses, resulting primarily from growth in total LHI, compared to a $19.0 million negative provision for credit losses for the second quarter of 2021.

Net interest income increased to $205.5 million for the second quarter of 2022, compared to $189.5 million for the second quarter of 2021, primarily due to an increase in yields on average earning assets, partially offset by an increase in funding costs. Net interest margin increased 66 basis points to 2.68% for the second quarter of 2022, as compared to the second quarter of 2021, primarily due to a shift in the composition of earning assets coupled with an increase in yield on earnings assets, partially offset by an increase in funding costs. LHI, excluding mortgage finance, yields increased 26 basis points compared to the second quarter of 2021 and LHI, mortgage finance yields increased 33 basis points from the second quarter of 2021. Total cost of deposits increased 13 basis points compared to the second quarter of 2021.

Non-interest income for the second quarter of 2022 decreased $11.4 million, or 30%, compared to the second quarter of 2021. The decrease was primarily due to decreases in servicing fee income, as a result of the sale of our mortgage servicing rights portfolio in 2021, and other non-interest income, partially offset by an increase in investment banking and trading income and the elimination of net losses recorded in the prior year on the sale of loans held for sale.

Non-interest expense for the second quarter of 2022 increased $15.2 million, or 10%, compared to the second quarter of 2021. The increase was primarily due to an increase in salaries and benefits expense, resulting primarily from an increase in headcount, as well as an increase in marketing expense, partially offset by a decrease in servicing-related expenses from the sale of our mortgage servicing rights portfolio in 2021.

CREDIT QUALITY

We recorded $2.6 million in net charge-offs during the second quarter of 2022, compared to net recoveries of $512,000 and net charge-offs of $2.4 million during the first quarter of 2022 and the second quarter of 2021, respectively. Criticized loans totaled $603.5 million at June 30, 2022, compared to $476.1 million at March 31, 2022 and $891.6 million at June 30, 2021. Non-accrual LHI totaled $50.5 million at June 30, 2022, compared to $59.3 million at December 31, 2021 and $86.6 million at June 30, 2021. The ratio of non-accrual LHI to total LHI for the second quarter of 2022 was 0.21%, compared to 0.27% for the first quarter of 2022 and 0.36% for the second quarter of 2021.

REGULATORY RATIOS AND CAPITAL

All regulatory ratios continue to be in excess of “well capitalized” requirements as of June 30, 2022. Our CET 1, tier 1 capital, total capital and leverage ratios were 10.5%, 11.9%, 14.4% and 10.7%, respectively, at June 30, 2022, compared to 11.5%, 13.0%, 15.7% and 9.9%, respectively, at March 31, 2022 and 10.5%, 12.1%, 14.8% and 8.4% at June 30, 2021. At June 30, 2022, our ratio of tangible common equity to total tangible assets was 8.3%, compared to 8.9% at March 31, 2022 and 7.9% at June 30, 2021.

During the second quarter of 2022, the Company repurchased 941,879 shares of its common stock for an aggregate purchase price of $50.0 million, at a weighted average price of $53.11 per share.

About Texas Capital Bancshares, Inc.

Texas Capital Bancshares, Inc. (NASDAQ: TCBI), a member of the Russell 2000 Index and the S&P MidCap 400, is the parent company of Texas Capital Bank, a full-service financial services firm that delivers customized solutions to businesses, entrepreneurs, and individual customers. Founded in 1998, the institution is headquartered in Dallas with offices in Austin, Houston, San Antonio, and Fort Worth, and has built a network of clients across the country. With the ability to service clients through their entire lifecycles, Texas Capital Bank has established commercial banking, consumer banking, investment banking and wealth management capabilities.

Forward Looking Statements

This communication contains “forward-looking statements” within the meaning of and pursuant to the Private Securities Litigation Reform Act of 1995 regarding, among other things, our financial condition, results of operations, business plans and future performance. These statements are not historical in nature and may often be identified by the use of words such as “expect,” “estimate,” “anticipate,” “plan,” “may,” “will,” “forecast,” “could,” “should,” “projects,” “targeted,” “continue,” “become,” “intend” and similar expressions.

Because forward-looking statements relate to future results and occurrences, they are subject to inherent and various uncertainties, risks, and changes in circumstances that are difficult to predict, may change over time, are based on management’s expectations and assumptions at the time the statements are made and are not guarantees of future results. A number of factors, many of which are beyond our control, could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. These factors include, but are not limited to, credit quality and risk, the COVID-19 pandemic, industry and technological changes, cyber incidents or other failures, disruptions or security breaches, interest rates, commercial and residential real estate values, economic conditions, including inflation and the threat of recession, as well as market conditions in Texas, the United States or internationally, as well as governmental and consumer responses to those economic and market conditions, fund availability, accounting estimates and risk management processes, the transition away from the London Interbank Offered Rate (LIBOR), legislative and regulatory changes, business strategy execution, key personnel, competition, mortgage markets, fraud, environmental liability and severe weather, natural disasters, acts of war or terrorism or other external events.

These and other factors that could cause results to differ materially from those described in the forward-looking statements, as well as a discussion of the risks and uncertainties that may affect our business, can be found in our Annual Report on Form 10-K, our Quarterly Reports on Form 10-Q and in other filings we make with the Securities and Exchange Commission. The information contained in this communication speaks only as of its date. Except to the extent required by applicable law or regulation, we disclaim any obligation to update such factors or to publicly announce the results of any revisions to any of the forward-looking statements included herein to reflect future events or developments.


TEXAS CAPITAL BANCSHARES, INC.
SELECTED FINANCIAL HIGHLIGHTS (UNAUDITED)
(dollars in thousands except per share data)
 2nd Quarter1st Quarter4th Quarter3rd Quarter2nd Quarter
  2022  2022  2021  2021  2021 
CONSOLIDATED STATEMENTS OF INCOME     
Interest income$242,349 $208,530 $219,892 $216,589 $216,953 
Interest expense 36,818  24,983  25,860  26,053  27,496 
Net interest income 205,531  183,547  194,032  190,536  189,457 
Provision for credit losses 22,000  (2,000) (10,000) 5,000  (19,000)
Net interest income after provision for credit losses 183,531  185,547  204,032  185,536  208,457 
Non-interest income 26,242  20,282  31,459  24,779  37,639 
Non-interest expense 164,303  153,092  146,649  152,987  149,060 
Income before income taxes 45,470  52,737  88,842  57,328  97,036 
Income tax expense 11,311  13,087  23,712  13,938  23,555 
Net income 34,159  39,650  65,130  43,390  73,481 
Preferred stock dividends 4,312  4,313  4,313  4,312  6,317 
Net income available to common stockholders$29,847 $35,337 $60,817 $39,078 $67,164 
Diluted earnings per common share$0.59 $0.69 $1.19 $0.76 $1.31 
Diluted common shares 50,801,628  51,324,027  51,208,161  51,139,555  51,093,660 
      
CONSOLIDATED BALANCE SHEET DATA     
Total assets$32,338,963 $31,085,377 $34,731,738 $36,404,320 $35,228,542 
Loans held for investment 17,517,866  15,849,434  15,331,457  15,221,404  15,168,565 
Loans held for investment, mortgage finance 6,549,507  5,827,965  7,475,497  8,528,313  8,772,799 
Loans held for sale 4,266  8,085  8,123  9,660  63,747 
Interest-bearing cash and cash equivalents 4,032,931  5,136,680  7,765,996  8,317,926  6,768,650 
Investment securities 3,552,699  3,642,015  3,583,808  3,663,874  3,798,275 
Non-interest bearing deposits 12,555,367  13,434,723  13,390,370  14,970,462  14,228,038 
Total deposits 25,440,021  25,377,938  28,109,365  29,813,668  28,839,563 
Short-term borrowings 2,651,536  1,427,033  2,202,832  2,203,470  2,014,481 
Long-term debt 917,098  929,414  928,738  928,062  927,386 
Stockholders’ equity 3,006,832  3,090,038  3,209,616  3,147,752  3,114,957 
      
End of period shares outstanding 49,878,041  50,710,441  50,618,494  50,605,626  50,592,201 
Book value$54.27 $55.02 $57.48 $56.27 $55.64 
Tangible book value(1)$53.93 $54.68 $57.14 $55.93 $55.29 
      
SELECTED FINANCIAL RATIOS     
Net interest margin 2.68% 2.23% 2.12% 2.11% 2.02%
Return on average assets 0.44% 0.47% 0.69% 0.47% 0.76%
Return on average common equity 4.35% 4.97% 8.36% 5.41% 9.74%
Non-interest income to average earning assets 0.34% 0.25% 0.34% 0.27% 0.40%
Efficiency ratio(2) 70.9% 75.1% 65.0% 71.1% 65.6%
Non-interest expense to average earning assets 2.16% 1.86% 1.60% 1.69% 1.59%
Tangible common equity to total tangible assets(3) 8.3% 8.9% 8.3% 7.8% 7.9%
Common Equity Tier 1 10.5% 11.5% 11.1% 10.7% 10.5%
Tier 1 capital 11.9% 13.0% 12.6% 12.2% 12.1%
Total capital 14.4% 15.7% 15.3% 14.9% 14.8%
Leverage 10.7% 9.9% 9.0% 9.0% 8.4%

(1)   Stockholders’ equity excluding preferred stock, less goodwill and intangibles, divided by shares outstanding at period end.
(2)   Non-interest expense divided by the sum of net interest income and non-interest income.
(3)   Stockholders’ equity excluding preferred stock, less goodwill and intangibles, divided by total assets, less goodwill and intangibles.
        

TEXAS CAPITAL BANCSHARES, INC.
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(dollars in thousands)
 June 30, 2022June 30, 2021% Change
Assets   
Cash and due from banks$242,425 $202,549 20 %
Interest-bearing cash and cash equivalents 4,032,931  6,768,650 (40)%
Available-for-sale debt securities 2,535,646  3,757,228 (33)%
Held-to-maturity debt securities 980,935   100 %
Equity securities 36,118  41,047 (12)%
Investment securities 3,552,699  3,798,275 (6)%
Loans held for sale 4,266  63,747 (93)%
Loans held for investment, mortgage finance 6,549,507  8,772,799 (25)%
Loans held for investment 17,517,866  15,168,565 15 %
Less: Allowance for credit losses on loans 229,013  221,511 3 %
Loans held for investment, net 23,838,360  23,719,853  %
Mortgage servicing rights, net   1,316 (100)%
Premises and equipment, net 28,722  21,969 31%
Accrued interest receivable and other assets 622,501  634,719 (2)%
Goodwill and intangibles, net 17,059  17,464 (2)%
Total assets$32,338,963 $35,228,542 (8)%
    
Liabilities and Stockholders’ Equity   
Liabilities:   
Non-interest bearing deposits$12,555,367 $14,228,038 (12)%
Interest bearing deposits 12,884,654  14,611,525 (12)%
Total deposits 25,440,021  28,839,563 (12)%
Accrued interest payable 8,928  8,116 10 %
Other liabilities 314,548  324,039 (3)%
Short-term borrowings 2,651,536  2,014,481 32 %
Long-term debt 917,098  927,386 (1)%
Total liabilities 29,332,131  32,113,585 (9)%
    
Stockholders’ equity:   
Preferred stock, $.01 par value, $1,000 liquidation value:   
Authorized shares - 10,000,000   
Issued shares - 300,000 shares issued at June 30, 2022 and 2021 300,000  300,000  %
Common stock, $.01 par value:   
Authorized shares - 100,000,000   
Issued shares - 50,820,337 and 50,592,618 at June 30, 2022 and 2021, respectively 508  506  %
Additional paid-in capital 1,015,105  992,469 2 %
Retained earnings 2,013,458  1,848,379 9 %
Treasury stock - 942,296 and 417 shares at cost at June 30, 2022 and 2021, respectively (50,031) (8)N/M
Accumulated other comprehensive loss, net of taxes (272,208) (26,389)932 %
Total stockholders’ equity 3,006,832  3,114,957 (3)%
Total liabilities and stockholders’ equity$32,338,963 $35,228,542 (8)%


TEXAS CAPITAL BANCSHARES, INC.    
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)    
(dollars in thousands except per share data)    
 Three Months Ended June 30,Six Months Ended June 30,
  2022 2021  2022 2021 
Interest income    
Interest and fees on loans$218,290$203,074 $405,947$413,405 
Investment securities 14,665 10,918  31,967 20,805 
Interest-bearing cash and cash equivalents 9,394 2,961  12,965 5,894 
Total interest income 242,349 216,953  450,879 440,104 
Interest expense    
Deposits 20,566 16,271  34,196 36,275 
Short-term borrowings 4,859 502  5,617 3,094 
Long-term debt 11,393 10,723  21,988 16,466 
Total interest expense 36,818 27,496  61,801 55,835 
Net interest income 205,531 189,457  389,078 384,269 
Provision for credit losses 22,000 (19,000) 20,000 (25,000)
Net interest income after provision for credit losses 183,531 208,457  369,078 409,269 
Non-interest income    
Service charges on deposit accounts 6,003 4,634  12,025 9,350 
Wealth management and trust fee income 4,051 3,143  7,963 5,998 
Brokered loan fees 4,133 6,933  8,103 16,244 
Servicing income 228 5,935  465 14,944 
Investment banking and trading income 11,126 8,071  15,305 13,858 
Net gain/(loss) on sale of loans held for sale  (3,070)  2,502 
Other 701 11,993  2,663 19,096 
Total non-interest income 26,242 37,639  46,524 81,992 
Non-interest expense    
Salaries and benefits 103,885 86,830  203,983 174,352 
Occupancy expense 8,874 7,865  17,759 16,139 
Marketing 8,506 1,900  13,483 3,597 
Legal and professional 11,288 9,147  21,590 17,424 
Communications and technology 15,649 14,352  30,349 30,321 
Federal Deposit Insurance Corporation (“FDIC”) insurance assessment 3,318 5,226  7,299 11,839 
Servicing-related expenses  12,355   25,344 
Other 12,783 11,385  22,932 20,360 
Total non-interest expense 164,303 149,060  317,395 299,376 
Income before income taxes 45,470 97,036  98,207 191,885 
Income tax expense 11,311 23,555  24,398 46,466 
Net income 34,159 73,481  73,809 145,419 
Preferred stock dividends 4,312 6,317  8,625 10,096 
Net income available to common stockholders$29,847$67,164 $65,184$135,323 
     
Basic earnings per common share$0.59$1.33 $1.29$2.68 
Diluted earnings per common share$0.59$1.31 $1.28$2.65 


TEXAS CAPITAL BANCSHARES, INC.
SUMMARY OF CREDIT LOSS EXPERIENCE
(dollars in thousands)
 2nd Quarter1st Quarter4th Quarter3rd Quarter2nd Quarter
  2022  2022  2021  2021  2021 
Allowance for credit losses on loans:     
Beginning balance$211,151 $211,866 $221,957 $221,511 $242,484 
Loans charged-off:     
Commercial 2,868  110  3,776  4,348  1,412 
Energy         686 
Real estate   350      1,192 
Total charge-offs 2,868  460  3,776  4,348  3,290 
Recoveries:     
Commercial 219  217  1,933  1,104  308 
Energy   755  601  42  609 
Real estate     205  112   
Total recoveries 219  972  2,739  1,258  917 
Net charge-offs 2,649  (512) 1,037  3,090  2,373 
Provision for credit losses on loans 20,511  (1,227) (9,054) 3,536  (18,600)
Ending balance$229,013 $211,151 $211,866 $221,957 $221,511 
      
Allowance for off-balance sheet credit losses:     
Beginning balance$16,492 $17,265 $18,211 $16,747 $17,147 
Provision for off-balance sheet credit losses 1,489  (773) (946) 1,464  (400)
Ending balance$17,981 $16,492 $17,265 $18,211 $16,747 
      
Total allowance for credit losses$246,994 $227,643 $229,131 $240,168 $238,258 
Total provision for credit losses$22,000 $(2,000)$(10,000)$5,000 $(19,000)
      
Allowance for credit losses on loans to total loans held for investment 0.95 % 0.97 % 0.93 % 0.93 % 0.93 %
Allowance for credit losses on loans to average total loans held for investment 1.02 % 0.99 % 0.91 % 0.95 % 0.98 %
Net charge-offs to average total loans held for investment(1) 0.05 %(0.01)% 0.02 % 0.05 % 0.04 %
Net charge-offs to average total loans held for investment for last 12 months(1) 0.03 % 0.03 % 0.06 % 0.33 % 0.31 %
Total provision for credit losses to average total loans held for investment(1) 0.39 %(0.04)%(0.17)% 0.09 %(0.34)%
Total allowance for credit losses to total loans held for investment 1.03 % 1.05 % 1.00 % 1.01 % 1.00 %

(1)   Interim period ratios are annualized.

TEXAS CAPITAL BANCSHARES, INC.     
SUMMARY OF NON-PERFORMING ASSETS AND PAST DUE LOANS   
(dollars in thousands)     
 2nd Quarter1st Quarter4th Quarter3rd Quarter2nd Quarter
 20222022202120212021
Non-accrual loans held for investment$50,526 $59,327 $72,502 $87,532 $86,636 
Non-accrual loans held for sale          
Other real estate owned          
Total non-performing assets$50,526 $59,327 $72,502 $87,532 $86,636 
      
Non-accrual loans held for investment to total loans held for investment 0.21 % 0.27 % 0.32 % 0.37 % 0.36 %
Total non-performing assets to earning assets 0.16 % 0.20 % 0.21 % 0.25 % 0.25 %
Allowance for credit losses on loans to non-accrual loans held for investment4.5x3.6x2.9x2.5x2.6x
      
Loans held for investment past due 90 days and still accruing(1)$3,206 $6,031 $3,467 $3,405 $7,671 
Loans held for investment past due 90 days to total loans held for investment 0.01 % 0.03 % 0.02 % 0.01 % 0.03 %
Loans held for sale past due 90 days and still accruing(2)$1,602 $3,865 $3,986 $3,808 $2,695 

(1)   At June 30, 2022, loans past due 90 days and still accruing include premium finance loans of $3.1 million. These loans are primarily secured by obligations of insurance carriers to refund premiums on canceled insurance policies. The refund of premiums from the insurance carriers can take 180 days or longer from the cancellation date.
(2)   Includes loans guaranteed by U.S. government agencies that were repurchased out of Ginnie Mae securities. Loans are recorded as loans held for sale and carried at fair value on the balance sheet. Interest on these past due loans accrues at the debenture rate guaranteed by the U.S. government.

TEXAS CAPITAL BANCSHARES, INC.
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
(dollars in thousands)
      
 2nd Quarter1st Quarter4th Quarter3rd Quarter2nd Quarter
 2022 2022  2021  2021  2021 
Interest income     
Interest and fees on loans$218,290$187,657 $204,379 $202,748 $203,074 
Investment securities 14,665 17,302  11,780  10,235  10,918 
Interest-bearing deposits in other banks 9,394 3,571 $3,733 $3,606  2,961 
Total interest income 242,349 208,530  219,892  216,589  216,953 
Interest expense     
Deposits 20,566 13,630  14,513  14,719  16,271 
Short-term borrowings 4,859 758  771  748  502 
Long-term debt 11,393 10,595  10,576  10,586  10,723 
Total interest expense 36,818 24,983  25,860  26,053  27,496 
Net interest income 205,531 183,547  194,032  190,536  189,457 
Provision for credit losses 22,000 (2,000) (10,000) 5,000  (19,000)
Net interest income after provision for credit losses 183,531 185,547  204,032  185,536  208,457 
Non-interest income     
Service charges on deposit accounts 6,003 6,022  4,702  4,622  4,634 
Wealth management and trust fee income 4,051 3,912  3,793  3,382  3,143 
Brokered loan fees 4,133 3,970  5,678  6,032  6,933 
Servicing income 228 237  277  292  5,935 
Investment banking and trading income 11,126 4,179  6,456  4,127  8,071 
Net gain/(loss) on sale of loans held for sale      (1,185) (3,070)
Other 701 1,962  10,553  7,509  11,993 
Total non-interest income 26,242 20,282  31,459  24,779  37,639 
Non-interest expense     
Salaries and benefits 103,885 100,098  89,075  87,503  86,830 
Occupancy expense 8,874 8,885  8,769  8,324  7,865 
Marketing 8,506 4,977  4,286  2,123  1,900 
Legal and professional 11,288 10,302  12,673  11,055  9,147 
Communications and technology 15,649 14,700  16,490  28,374  14,352 
FDIC insurance assessment 3,318 3,981  4,688  4,500  5,226 
Servicing-related expenses    25  2,396  12,355 
Other 12,783 10,149  10,643  8,712  11,385 
Total non-interest expense 164,303 153,092  146,649  152,987  149,060 
Income before income taxes 45,470 52,737  88,842  57,328  97,036 
Income tax expense 11,311 13,087  23,712  13,938  23,555 
Net income 34,159 39,650  65,130  43,390  73,481 
Preferred stock dividends 4,312 4,313  4,313  4,312  6,317 
Net income available to common shareholders$29,847$35,337 $60,817 $39,078 $67,164 


TEXAS CAPITAL BANCSHARES, INC.
TAXABLE EQUIVALENT NET INTEREST INCOME ANALYSIS (UNAUDITED)(1)
(dollars in thousands)
 2nd Quarter 2022 1st Quarter 2022 4th Quarter 2021 3rd Quarter 2021 2nd Quarter 2021
 Average
Balance
Income/
Expense
Yield/
Rate
 Average
Balance
Income/
Expense
Yield/
Rate
 Average
Balance
Income/
Expense
Yield/
Rate
 Average
Balance
Income/
Expense
Yield/
Rate
 Average
Balance
Income/
Expense
Yield/
Rate
Assets                   
Investment securities(2)$3,543,576$15,0651.60% $3,669.257$17,7431.91% $3,608,503$12,2251.34% $3,775,812$10,6841.12% $3,543,270$11,3691.29%
Interest-bearing cash and cash equivalents 4,747,377 9,3940.79%  8,552,300 3,5710.17%  9,760,735 3,7330.15%  9,046,095 3,6060.16%  11,583,759 2,9610.10%
Loans held for sale 8,123 623.07%  7,633 1136.01%  8,348 512.41%  18,791 541.14%  93,164 7813.36%
Loans held for investment, mortgage finance 5,858,599 49,9143.42%  5,732,901 43,4663.07%  7,901,534 57,9492.91%  7,987,521 58,9132.93%  7,462,223 57,4013.09%
Loans held for investment(3) 16,616,234 168,4074.07%  15,686.319 144,1343.73%  15,348,322 146,4363.79%  15,266,167 143,8643.74%  15,242,975 144,9783.81%
Less: Allowance for credit losses on loans 211,385    212,612    223,034    220,984    241,676  
Loans held for investment, net 22,263,448 218,3213.93%  21,206,608 187,6003.59%  23,026,822 204,3853.52%  23,032,704 202,7773.49%  22,463,522 202,3793.61%
Total earning assets 30,562,524 242,8423.16%  33,435,798 209,0272.54%  36,404,408 220,3942.40%  35,873,402 217,1212.40%  37,683,715 217,4902.31%
Cash and other assets 870,396    819,486    835,293    855,555    996,946  
Total assets$31,432,920   $34,255,284   $37,239,701   $36,728,957   $38,680,661  
                    
Liabilities and Stockholders’ Equity                   
Transaction deposits$1,671,729$3,9200.94% $2,432,687$3,9620.66% $3,007,337$4,6640.62% $3,012,547$4,7370.62% $3,795,152$5,3950.57%
Savings deposits 8,696,819 15,4620.71%  10,420,545 8,5830.33%  10,529,645 8,4190.32%  10,044,995 8,2620.33%  11,296,382 8,9900.32%
Time deposits 877,399 1,1840.54%  1,038,722 1,0850.42%  1,276,800 1,4300.44%  1,640,562 1,7200.42%  1,755,993 1,8860.43%
Total interest bearing deposits 11,245,947 20,5660.73%  13,891,954 13,6300.40%  14,813,782 14,5130.39%  14,698,104 14,7190.40%  16,847,527 16,2710.39%
Short-term borrowings 2,232,119 4,8590.87%  1,770,781 7580.17%  2,267,013 7710.13%  2,299,692 7480.13%  2,349,718 5020.09%
Long-term debt 929,616 11,3934.92%  929,005 10,5954.63%  928,307 10,5764.52%  927,626 10,5864.53%  881,309 10,7234.88%
Total interest bearing liabilities 14,407,682 36,8181.02%  16,591,740 24,9830.61%  18,009,102 25,8600.57%  17,925,422 26,0530.58%  20,078,554 27,4960.55%
Non-interest bearing deposits 13,747,876    14,235,749    15,804,061    15,363,568    15,139,546  
Other liabilities 227,701    243,141    238,833    275,317    274,401  
Stockholders’ equity 3,049,661    3,184,654    3,187,705    3,164,650    3,188,160  
Total liabilities and stockholders’ equity$31,432,920   $34,255,284   $37,239,701   $36,728,957   $38,680,661  
Net interest income $206,024   $184,044   $194,534   $191,068   $189,994 
Net interest margin  2.68%   2.23%   2.12%   2.11%   2.02%

(1)   Taxable equivalent rates used where applicable.
(2)   Yields on investment securities are calculated using available-for-sale securities at amortized cost.
(3)   Average balances include non-accrual loans.

 

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