EPS Forecast
Revenue Forecast
EX-99.1
2
a01222020exhibit991.htm
EXHIBIT 99.1 EARNINGS RELEASE
Exhibit
Exhibit 99.1
INVESTOR CONTACT
Julie Anderson, 214.932.6773
julie.anderson@texascapitalbank.com
MEDIA CONTACT
Shannon Wherry, 469.399.8527
shannon.wherry@texascapitalbank.com
TEXAS CAPITAL BANCSHARES, INC. ANNOUNCES OPERATING RESULTS FOR 2019
DALLAS - January 22, 2020 - Texas Capital Bancshares, Inc. (NASDAQ: TCBI), the parent company of Texas Capital Bank, announced earnings and operating results for the fourth quarter and full year of 2019.
“We are pleased with our 2019 results as we finished the year with a meaningful improvement in year-over-year EPS, despite headwinds from interest rate decreases, and a continued focus on proactively dealing with credit to strengthen our balance sheet and future earning power," said Keith Cargill, CEO. "Our results this year highlight the continued strength of our organic business model having gained meaningful market share over the past 7 years while more than tripling our balance sheet and more than doubling EPS. We are confident that our pending merger with Independent Bank Group will better position us to drive long-term shareholder value, improve client experience and invest even more effectively in our talent, technology and communities due to the scale advantage and complementary strengths we each offer."
• | Average mortgage finance loans, including mortgage correspondent aggregation ("MCA") loans held for sale ("LHS"), increased 7% on a linked quarter basis and increased 61% from the fourth quarter of 2018. |
• | Average demand deposits and average total deposits increased 9% and 6%, respectively, on a linked quarter basis and increased 47% and 35%, respectively from the fourth quarter of 2018. |
• | Average loans held for investment ("LHI"), excluding mortgage finance loans, decreased 1% on a linked quarter basis and increased less than 1% from the fourth quarter of 2018, reflecting planned reductions in our leveraged lending and energy balances. |
• | Net income and EPS for full year 2019 both increased 7% compared to full year 2018. |
FINANCIAL SUMMARY
(Dollars and shares in thousands)
2019 | 2018 | % Change | ||||||||
ANNUAL OPERATING RESULTS | ||||||||||
Net income | $ | 322,866 | $ | 300,824 | 7 | % | ||||
Net income available to common stockholders | $ | 313,116 | $ | 291,074 | 8 | % | ||||
Diluted EPS | $ | 6.21 | $ | 5.79 | 7 | % | ||||
Diluted shares | 50,419 | 50,273 | — | % | ||||||
ROA | 1.04 | % | 1.19 | % | ||||||
ROE | 12.38 | % | 13.14 | % | ||||||
QUARTERLY OPERATING RESULTS | ||||||||||
Net income | $ | 73,917 | $ | 71,891 | 3 | % | ||||
Net income available to common stockholders | $ | 71,480 | $ | 69,454 | 3 | % | ||||
Diluted EPS | $ | 1.42 | $ | 1.38 | 3 | % | ||||
Diluted shares | 50,462 | 50,333 | — | % | ||||||
ROA | 0.85 | % | 1.09 | % | ||||||
ROE | 10.68 | % | 11.82 | % | ||||||
BALANCE SHEET | ||||||||||
LHS | $ | 2,577,134 | $ | 1,969,474 | 31 | % | ||||
LHI, mortgage finance | 8,169,849 | 5,877,524 | 39 | % | ||||||
LHI | 16,476,413 | 16,690,550 | (1 | )% | ||||||
Total LHI | 24,646,262 | 22,568,074 | 9 | % | ||||||
Total loans | 27,223,396 | 24,537,548 | 11 | % | ||||||
Total assets | 32,548,069 | 28,257,767 | 15 | % | ||||||
Demand deposits | 9,438,459 | 7,317,161 | 29 | % | ||||||
Total deposits | 26,478,593 | 20,606,113 | 28 | % | ||||||
Stockholders’ equity | 2,832,258 | 2,500,394 | 13 | % | ||||||
DETAILED FINANCIALS
Texas Capital Bancshares, Inc. reported net income of $322.9 million and net income available to common stockholders of $313.1 million for the year ended December 31, 2019, compared to net income of $300.8 million and net income available to common stockholders of $291.1 million for the year ended December 31, 2018. For the fourth quarter of 2019, net income was $73.9 million and net income available to common stockholders was $71.5 million, compared to net income of $71.9 million and net income available to common stockholders of $69.5 million for the same period in 2018. On a fully diluted basis, earnings per common share were $6.21 for the year ended December 31, 2019 compared to $5.79 for the same period in 2018. Diluted earnings per common share were $1.42 for the quarter ended December 31, 2019 compared to $1.38 for the same period of 2018. The fourth quarter of 2019 includes $1.3 million, or $.02 per common share, of merger-related expenses.
Return on common equity ("ROE") was 12.38 percent and return on average assets ("ROA") was 1.04 percent for the year ended December 31, 2019, compared to 13.14 percent and 1.19 percent, respectively, for the year ended December 31, 2018. ROE was 10.68 percent and ROA was 0.85 percent for the fourth quarter of 2019, compared to 13.22 percent and 1.06 percent, respectively, for the third quarter of 2019 and 11.82 percent and 1.09 percent, respectively, for the fourth quarter of 2018. The linked quarter decreases in ROE and ROA for the fourth quarter of 2019 resulted primarily from increases in non-interest expense and provision for credit losses, as well as from decreases in net interest and non-interest income.
Net interest income was $248.4 million for the fourth quarter of 2019, compared to $252.2 million for the third quarter of 2019 and $240.7 million for the fourth quarter of 2018. The linked quarter decrease is due primarily to decreases in loan yields and the year over year increase is primarily due to growth in total loans, offset by decreases in loan yields. Net interest margin for the fourth quarter of 2019 was 2.95 percent, a decrease of 21 basis points from the third quarter of 2019 and a decrease of 83 basis points from the fourth quarter of 2018. LHI, excluding mortgage finance loans, yields were down 37 basis points from the third quarter of 2019, and were down 56 basis points compared to the fourth quarter of 2018. Mortgage finance, excluding MCA, yields for the fourth quarter of 2019 decreased 18 basis points compared to the third quarter of 2019 and decreased 54 basis points compared to the fourth quarter of 2018. Total cost of deposits for the fourth quarter of 2019 decreased 22 basis points to 0.99 percent compared to 1.21 percent for the third quarter of 2019, and decreased 18 basis points from 1.17 percent for the fourth quarter of 2018.
Average LHI, excluding mortgage finance loans, for the year ended December 31, 2019 were $16.8 billion, an increase of $728.9 million, or 5 percent, from the same period in 2018. Average LHI, excluding mortgage finance loans, for the fourth quarter of 2019 were $16.7 billion, a decrease of $234.1 million, or 1 percent, from the third quarter of 2019 and an increase of $23.7 million, less than 1 percent, from the fourth quarter of 2018. The linked quarter decrease in average LHI, excluding mortgage finance loans, reflects slower loan growth and planned reductions in our leveraged lending and energy balances. Average total mortgage finance loans, including MCA loans, for the fourth quarter of 2019 were $11.4 billion, an increase of $765.4 million, or 7 percent, from the third quarter of 2019 and an increase of $4.3 billion, or 61 percent, from the fourth quarter of 2018. The linked quarter and year-over-year increases in total mortgage finance loans were due to increases in volumes from continued lower long-term interest rates.
Average total deposits for the year ended December 31, 2019 were $24.7 billion, an increase of $4.4 billion, or 22 percent, from the same period in 2018. Average demand deposits for the year ended December 31, 2019 were $9.0 billion, an increase of $1.1 billion, or 14 percent, from the same period in December 31, 2018. Average total deposits for the fourth quarter of 2019 increased $1.7 billion, or 6 percent, from the third quarter of 2019 and increased $7.4 billion, or 35 percent, from the fourth quarter of 2018. Average demand deposits for the fourth quarter of 2019 increased $941.5 million, or 9 percent, to $10.9 billion from $10.0 billion for the third quarter of 2019, and increased $3.5 billion, or 47 percent, from the fourth quarter of 2018.
We recorded a $17.0 million provision for credit losses for the fourth quarter of 2019 compared to $11.0 million for the third quarter of 2019 and $35.0 million for the fourth quarter of 2018. The provision for the fourth quarter of 2019 was driven by the consistent application of our methodology. The linked quarter increase in the provision resulted from an increase in non-performing assets partially offset by a decline in charge-offs, while the year-over-year decrease resulted from decreases in charge-offs and LHI, excluding mortgage finance, balances. The total allowance for credit losses at December 31, 2019 increased to 0.83 percent of total LHI, compared to 0.81 percent at September 30, 2019 and decreased from 0.90 percent at December 31, 2018. In management’s opinion, the allowance is appropriate and is derived from consistent application of the methodology for establishing reserves for the loan portfolio.
Non-performing assets ("NPAs") increased in the fourth quarter of 2019 compared to the third quarter of 2019 and fourth quarter of 2018, primarily related to our energy and leveraged lending portfolios. The ratio of NPAs to total LHI plus other real estate owned ("OREO") for the fourth quarter of 2019 was 0.91 percent, compared to 0.49 percent for the third quarter of 2019 and 0.36 percent for the fourth quarter of 2018. Net charge-offs for the fourth quarter of 2019 were $12.8 million compared to $36.9 million for the third quarter of 2019 and $32.6 million for the fourth quarter of 2018. Of the $12.8 million charge-offs for the fourth quarter of 2019, $588,000 related to energy and $6.2 million related to leveraged lending. For the fourth quarter of 2019, net charge-offs were 0.21 percent of average total LHI, compared to 0.58 percent for the third quarter of 2019 and 0.60 percent for the same period in 2018.
2
Non-interest income decreased $2.5 million, or 13 percent, during the fourth quarter of 2019 compared to the third quarter of 2019, and increased $2.5 million, or 16 percent, compared to the fourth quarter of 2018. The linked quarter decrease is primarily related to decreases in net gain/loss on sale of LHS and other non-interest income, partially offset by increases in servicing income and swap fees. The year-over-year increase is primarily related to increases in brokered loan fees and servicing income, partially offset by a decrease in other non-interest income.
Non-interest expense for the fourth quarter of 2019 increased $9.3 million, or 6 percent, compared to the third quarter of 2019, and increased $28.8 million, or 22 percent, compared to the fourth quarter of 2018. The linked quarter increase in non-interest expense was primarily related to increases in legal and professional expense and communications and technology expense, partially offset by a decrease in servicing related expenses. The year-over-year increase was primarily due to increases in salaries and employee benefits, legal and professional expense, communications and technology expense and marketing expense. The linked quarter and year-over-year increases in legal and professional expense included $1.3 million in merger-related expenses, as well as increases related to investment in Bask Bank and new commercial loan verticals, specifically $6.0 million that is not recurring.
Stockholders’ equity increased by 13 percent from $2.5 billion at December 31, 2018 to $2.8 billion at December 31, 2019, primarily due to the retention of net income. Texas Capital Bank is well capitalized under regulatory guidelines. At December 31, 2019, our ratio of tangible common equity to total tangible assets was 8.2 percent.
About Texas Capital Bancshares, Inc.
Texas Capital Bancshares, Inc. (NASDAQ®: TCBI), a member of the Russell 1000® Index and the S&P MidCap 400®, is the parent company of Texas Capital Bank, a commercial bank that delivers highly personalized financial services to businesses and entrepreneurs. Headquartered in Dallas, the bank has full-service locations in Austin, Dallas, Fort Worth, Houston and San Antonio. On December 9, 2019, Texas Capital Bancshares, Inc. (“TCBI”), announced that it had entered into an Agreement and Plan of Merger with Independent Bank Group, Inc. (“IBTX”), which provides that, upon the terms and subject to the conditions set forth therein, TCBI will merge with and into IBTX (the “Merger”), with IBTX as the surviving entity in the Merger. For additional information see the related filings by TCBI with the Securities and Exchange Commission (“SEC”).
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 are not historical in nature and can generally be identified by such words as “believe,” “expect,” “estimate,” “anticipate,” “plan,” “may,” “will,” “forecast,” “could,” “projects,” “intend” and similar expressions. Because forward-looking statements relate to future results and occurrences, they are subject to inherent uncertainties, risks, and changes in circumstances that are difficult to predict. 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 risks and uncertainties include, but are not limited to, the credit quality of our loan portfolio, general economic conditions in the United States and in our markets, including the continued impact on our customers from volatility in oil and gas prices, delays in completing the pending merger between TCBI and IBTX, the failure to obtain necessary regulatory approvals and shareholder approvals or to satisfy any of the other conditions to the merger on a timely basis or at all, the possibility that the anticipated benefits of the merger are not realized when expected or at all, expectations regarding rates of default and loan losses, volatility in the mortgage industry, our business strategies, and our expectations about future financial performance, future growth and earnings, the appropriateness of our allowance for loan losses and provision for credit losses, the impact of changing regulatory requirements and legislative changes on our business, increased competition, interest rate risk, the inability to realize cost savings or improved revenues or to implement integration plans and other consequences associated with the proposed merger or new lines of business, new product or service offerings and new technologies. 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, TCBI disclaims 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.
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 on January 21, 2020 to register the shares of IBTX’s capital stock to be issued in connection with the merger. The registration statement includes a joint proxy statement/prospectus. The registration statement has not yet become effective. After the Form S-4 is effective, a definitive joint proxy statement/prospectus will be sent to the shareholders of IBTX and TCBI seeking their approval of the proposed transaction.
3
INVESTORS AND SECURITY HOLDERS ARE URGED TO READ THE REGISTRATION STATEMENT ON FORM S-4, THE JOINT PROXY STATEMENT/PROSPECTUS INCLUDED WITHIN THE REGISTRATION STATEMENT ON FORM S-4 AND ANY OTHER RELEVANT DOCUMENTS FILED OR TO BE FILED WITH THE SEC IN CONNECTION WITH THE PROPOSED TRANSACTION BECAUSE THESE DOCUMENTS DO AND WILL CONTAIN IMPORTANT INFORMATION ABOUT IBTX, TCBI AND THE PROPOSED TRANSACTION.
Investors and security holders may obtain copies of these documents free of charge through the website maintained by the SEC at www.sec.gov or from IBTX at its website, www.ibtx.com, or from TCBI at its website, www.texascapitalbank.com. Documents filed with the SEC by IBTX will be available free of charge by accessing the Investor Relations page of IBTX’s website at www.ibtx.com or, alternatively, by directing a request by telephone or mail to Independent Bank Group, Inc., 7777 Henneman Way, McKinney, Texas 75070, (972) 562-9004, and documents filed with the SEC by TCBI will be available free of charge by accessing TCBI’s website at www.texascapitalbank.com under the tab “About Us,” and then under the heading “Investor Relations” or, alternatively, by directing a request by telephone or mail to Texas Capital Bancshares, Inc., 2000 McKinney Avenue, Suite 700, Dallas, Texas 75201, (214) 932-6600.
Participants in the Solicitation
IBTX, TCBI and certain of their respective directors and executive officers may be deemed to be participants in the solicitation of proxies from the shareholders of IBTX and TCBI in connection with the proposed transaction under the rules of the SEC. Certain information regarding the interests of these participants and a description of their direct and indirect interests, by security holdings or otherwise, will be included in the joint proxy statement/prospectus regarding the proposed transaction when it becomes available. Additional information about IBTX, and its directors and executive officers, may be found in IBTX’s definitive proxy statement relating to its 2019 Annual Meeting of Shareholders filed with the SEC on April 23, 2019, and other documents filed by IBTX with the SEC. Additional information about TCBI, and its directors and executive officers, may be found in TCBI’s definitive proxy statement relating to its 2019 Annual Meeting of Shareholders filed with the SEC on March 7, 2019, and other documents filed by TCBI with the SEC. These documents can be obtained free of charge from the sources described above.
4
TEXAS CAPITAL BANCSHARES, INC. | |||||||||||||||
SELECTED FINANCIAL HIGHLIGHTS (UNAUDITED) | |||||||||||||||
(Dollars in thousands except per share data) | |||||||||||||||
4th Quarter | 3rd Quarter | 2nd Quarter | 1st Quarter | 4th Quarter | |||||||||||
2019 | 2019 | 2019 | 2019 | 2018 | |||||||||||
CONSOLIDATED STATEMENTS OF INCOME | |||||||||||||||
Interest income | $ | 337,757 | $ | 355,101 | $ | 346,893 | $ | 325,561 | $ | 321,718 | |||||
Interest expense | 89,372 | 102,933 | 103,340 | 89,947 | 81,045 | ||||||||||
Net interest income | 248,385 | 252,168 | 243,553 | 235,614 | 240,673 | ||||||||||
Provision for credit losses | 17,000 | 11,000 | 27,000 | 20,000 | 35,000 | ||||||||||
Net interest income after provision for credit losses | 231,385 | 241,168 | 216,553 | 215,614 | 205,673 | ||||||||||
Non-interest income | 17,761 | 20,301 | 24,364 | 30,014 | 15,280 | ||||||||||
Non-interest expense | 158,690 | 149,370 | 141,561 | 140,378 | 129,862 | ||||||||||
Income before income taxes | 90,456 | 112,099 | 99,356 | 105,250 | 91,091 | ||||||||||
Income tax expense | 16,539 | 23,958 | 21,387 | 22,411 | 19,200 | ||||||||||
Net income | 73,917 | 88,141 | 77,969 | 82,839 | 71,891 | ||||||||||
Preferred stock dividends | 2,437 | 2,438 | 2,437 | 2,438 | 2,437 | ||||||||||
Net income available to common stockholders | $ | 71,480 | $ | 85,703 | $ | 75,532 | $ | 80,401 | $ | 69,454 | |||||
Diluted EPS | $ | 1.42 | $ | 1.70 | $ | 1.50 | $ | 1.60 | $ | 1.38 | |||||
Diluted shares | 50,461,723 | 50,416,402 | 50,383,870 | 50,345,399 | 50,333,412 | ||||||||||
CONSOLIDATED BALANCE SHEET DATA | |||||||||||||||
Total assets | $ | 32,548,069 | $ | 33,526,437 | $ | 29,970,384 | $ | 28,383,111 | $ | 28,257,767 | |||||
LHI | 16,476,413 | 16,772,824 | 16,924,535 | 17,061,590 | 16,690,550 | ||||||||||
LHI, mortgage finance | 8,169,849 | 7,951,432 | 7,415,363 | 6,299,710 | 5,877,524 | ||||||||||
LHS | 2,577,134 | 2,674,225 | 1,057,586 | 1,901,637 | 1,969,474 | ||||||||||
Liquidity assets(1) | 4,263,766 | 4,993,185 | 3,480,902 | 2,154,155 | 2,865,874 | ||||||||||
Investment securities | 239,871 | 238,022 | 240,851 | 230,749 | 120,216 | ||||||||||
Demand deposits | 9,438,459 | 10,289,572 | 7,685,340 | 6,743,607 | 7,317,161 | ||||||||||
Total deposits | 26,478,593 | 27,413,303 | 22,999,077 | 20,650,127 | 20,606,113 | ||||||||||
Other borrowings | 2,541,766 | 2,639,967 | 3,607,234 | 4,497,892 | 4,541,174 | ||||||||||
Subordinated notes | 282,129 | 282,038 | 281,948 | 281,858 | 281,767 | ||||||||||
Long-term debt | 113,406 | 113,406 | 113,406 | 113,406 | 113,406 | ||||||||||
Stockholders’ equity | 2,832,258 | 2,757,433 | 2,668,452 | 2,581,942 | 2,500,394 | ||||||||||
End of period shares outstanding | 50,337,741 | 50,317,654 | 50,297,552 | 50,263,611 | 50,200,710 | ||||||||||
Book value | $ | 53.29 | $ | 51.82 | $ | 50.07 | $ | 48.38 | $ | 46.82 | |||||
Tangible book value(2) | $ | 52.93 | $ | 51.46 | $ | 49.71 | $ | 48.02 | $ | 46.45 | |||||
SELECTED FINANCIAL RATIOS | |||||||||||||||
Net interest margin | 2.95 | % | 3.16 | % | 3.41 | % | 3.73 | % | 3.78 | % | |||||
Return on average assets | 0.85 | % | 1.06 | % | 1.05 | % | 1.26 | % | 1.09 | % | |||||
Return on average common equity | 10.68 | % | 13.22 | % | 12.20 | % | 13.58 | % | 11.82 | % | |||||
Non-interest income to average earning assets | 0.21 | % | 0.25 | % | 0.34 | % | 0.47 | % | 0.24 | % | |||||
Efficiency ratio(3) | 59.6 | % | 54.8 | % | 52.8 | % | 52.8 | % | 50.7 | % | |||||
Efficiency ratio, adjusted(4) | 57.7 | % | 51.2 | % | 49.5 | % | 50.1 | % | 48.7 | % | |||||
Non-interest expense to average earning assets | 1.87 | % | 1.86 | % | 1.97 | % | 2.21 | % | 2.03 | % | |||||
Tangible common equity to total tangible assets(5) | 8.2 | % | 7.7 | % | 8.3 | % | 8.5 | % | 8.3 | % | |||||
Common Equity Tier 1 | 8.9 | % | 8.6 | % | 8.7 | % | 8.6 | % | 8.6 | % | |||||
Tier 1 capital | 9.8 | % | 9.5 | % | 9.6 | % | 9.6 | % | 9.5 | % | |||||
Total capital | 11.4 | % | 11.1 | % | 11.3 | % | 11.4 | % | 11.3 | % | |||||
Leverage | 8.4 | % | 8.6 | % | 9.2 | % | 10.0 | % | 9.9 | % | |||||
(1) | Liquidity assets include Federal funds sold and interest-bearing deposits in other banks. |
(2) | Stockholders’ equity excluding preferred stock, less goodwill and intangibles, divided by shares outstanding at period end. |
(3) | Non-interest expense divided by the sum of net interest income and non-interest income. |
(4) | Non-interest expense, excluding deposit-related marketing fees and servicing related expenses, divided by the sum of net interest income and non-interest income, net of deposit-related marketing fees and servicing related expenses. Deposit-related marketing fees totaled $9.4 million, $11.9 million, $11.6 million, $9.1 million and $7.7 million for the fourth, third, second and first quarters of 2019, as well as for the fourth quarter of 2018, respectively. |
(5) | Stockholders’ equity excluding preferred stock and accumulated other comprehensive income, less goodwill and intangibles, divided by total assets, less accumulated other comprehensive income and goodwill and intangibles. |
5
TEXAS CAPITAL BANCSHARES, INC. | ||||||||
CONSOLIDATED BALANCE SHEETS (UNAUDITED) | ||||||||
(Dollars in thousands) | ||||||||
December 31, 2019 | December 31, 2018 | % Change | ||||||
Assets | ||||||||
Cash and due from banks | $ | 161,817 | $ | 214,191 | (24 | )% | ||
Interest-bearing deposits | 4,233,766 | 2,815,684 | 50 | % | ||||
Federal funds sold and securities purchased under resale agreements | 30,000 | 50,190 | (40 | )% | ||||
Securities, available-for-sale | 239,871 | 120,216 | 100 | % | ||||
LHS ($2,571.3 million and $1,969.2 million at December 2019 and 2018, respectively, at fair value) | 2,577,134 | 1,969,474 | 31 | % | ||||
LHI, mortgage finance | 8,169,849 | 5,877,524 | 39 | % | ||||
LHI (net of unearned income) | 16,476,413 | 16,690,550 | (1 | )% | ||||
Less: Allowance for loan losses | 195,047 | 191,522 | 2 | % | ||||
LHI, net | 24,451,215 | 22,376,552 | 9 | % | ||||
Mortgage servicing rights, net | 64,904 | 42,474 | 53 | % | ||||
Premises and equipment, net | 31,212 | 23,802 | 31 | % | ||||
Accrued interest receivable and other assets | 740,051 | 626,614 | 18 | % | ||||
Goodwill and intangibles, net | 18,099 | 18,570 | (3 | )% | ||||
Total assets | $ | 32,548,069 | $ | 28,257,767 | 15 | % | ||
Liabilities and Stockholders’ Equity | ||||||||
Liabilities: | ||||||||
Deposits: | ||||||||
Non-interest bearing | $ | 9,438,459 | $ | 7,317,161 | 29 | % | ||
Interest bearing | 17,040,134 | 13,288,952 | 28 | % | ||||
Total deposits | 26,478,593 | 20,606,113 | 28 | % | ||||
Accrued interest payable | 12,760 | 20,675 | (38 | )% | ||||
Other liabilities | 287,157 | 194,238 | 48 | % | ||||
Federal funds purchased and repurchase agreements | 141,766 | 641,174 | (78 | )% | ||||
Other borrowings | 2,400,000 | 3,900,000 | (38 | )% | ||||
Subordinated notes, net | 282,129 | 281,767 | — | % | ||||
Trust preferred subordinated debentures | 113,406 | 113,406 | — | % | ||||
Total liabilities | 29,715,811 | 25,757,373 | 15 | % | ||||
Stockholders’ equity: | ||||||||
Preferred stock, $.01 par value, $1,000 liquidation value: | ||||||||
Authorized shares - 10,000,000 | ||||||||
Issued shares - 6,000,000 shares issued at December 31, 2019 and 2018 | 150,000 | 150,000 | — | % | ||||
Common stock, $.01 par value: | ||||||||
Authorized shares - 100,000,000 | ||||||||
Issued shares - 50,338,158 and 50,201,127 at December 31, 2019 and 2018, respectively | 503 | 502 | — | % | ||||
Additional paid-in capital | 978,205 | 967,890 | 1 | % | ||||
Retained earnings | 1,694,608 | 1,381,492 | 23 | % | ||||
Treasury stock (shares at cost: 417 at December 31, 2019 and 2018) | (8 | ) | (8 | ) | — | % | ||
Accumulated other comprehensive income, net of taxes | 8,950 | 518 | 1,628 | % | ||||
Total stockholders’ equity | 2,832,258 | 2,500,394 | 13 | % | ||||
Total liabilities and stockholders’ equity | $ | 32,548,069 | $ | 28,257,767 | 15 | % | ||
6
TEXAS CAPITAL BANCSHARES, INC. | ||||||||||||
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) | ||||||||||||
(Dollars in thousands except per share data) | ||||||||||||
Three Months Ended December 31, | Year Ended December 31, | |||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||
Interest income | ||||||||||||
Interest and fees on loans | $ | 312,147 | $ | 310,470 | $ | 1,284,036 | $ | 1,124,970 | ||||
Investment securities | 2,618 | 1,274 | 8,654 | 2,834 | ||||||||
Federal funds sold and securities purchased under resale agreements | 439 | 984 | 1,529 | 3,792 | ||||||||
Interest-bearing deposits in other banks | 22,553 | 8,990 | 71,093 | 32,597 | ||||||||
Total interest income | 337,757 | 321,718 | 1,365,312 | 1,164,193 | ||||||||
Interest expense | ||||||||||||
Deposits | 70,987 | 61,773 | 293,537 | 185,116 | ||||||||
Federal funds purchased | 1,319 | 2,097 | 11,872 | 6,531 | ||||||||
Other borrowings | 11,712 | 11,726 | 58,393 | 36,207 | ||||||||
Subordinated notes | 4,191 | 4,191 | 16,764 | 16,764 | ||||||||
Trust preferred subordinated debentures | 1,163 | 1,258 | 5,026 | 4,715 | ||||||||
Total interest expense | 89,372 | 81,045 | 385,592 | 249,333 | ||||||||
Net interest income | 248,385 | 240,673 | 979,720 | 914,860 | ||||||||
Provision for credit losses | 17,000 | 35,000 | 75,000 | 87,000 | ||||||||
Net interest income after provision for credit losses | 231,385 | 205,673 | 904,720 | 827,860 | ||||||||
Non-interest income | ||||||||||||
Service charges on deposit accounts | 2,785 | 3,168 | 11,320 | 12,787 | ||||||||
Wealth management and trust fee income | 2,342 | 2,152 | 8,810 | 8,148 | ||||||||
Brokered loan fees | 8,645 | 5,408 | 29,738 | 22,532 | ||||||||
Servicing income | 4,030 | 2,861 | 13,439 | 18,307 | ||||||||
Swap fees | 1,559 | 1,356 | 4,387 | 5,625 | ||||||||
Net gain/(loss) on sale of LHS | (7,757 | ) | (8,087 | ) | (20,259 | ) | (15,934 | ) | ||||
Other | 6,157 | 8,422 | 45,005 | 26,559 | ||||||||
Total non-interest income | 17,761 | 15,280 | 92,440 | 78,024 | ||||||||
Non-interest expense | ||||||||||||
Salaries and employee benefits | 80,262 | 69,500 | 315,080 | 291,768 | ||||||||
Net occupancy expense | 9,075 | 7,390 | 32,989 | 30,342 | ||||||||
Marketing | 12,807 | 10,208 | 53,355 | 39,335 | ||||||||
Legal and professional | 22,402 | 13,042 | 53,830 | 42,990 | ||||||||
Communications and technology | 13,801 | 8,845 | 44,826 | 30,056 | ||||||||
FDIC insurance assessment | 5,613 | 5,423 | 20,093 | 24,307 | ||||||||
Servicing related expenses | 2,960 | 2,555 | 22,573 | 14,934 | ||||||||
Other | 11,770 | 12,899 | 47,253 | 51,364 | ||||||||
Total non-interest expense | 158,690 | 129,862 | 589,999 | 525,096 | ||||||||
Income before income taxes | 90,456 | 91,091 | 407,161 | 380,788 | ||||||||
Income tax expense | 16,539 | 19,200 | 84,295 | 79,964 | ||||||||
Net income | 73,917 | 71,891 | 322,866 | 300,824 | ||||||||
Preferred stock dividends | 2,437 | 2,437 | 9,750 | 9,750 | ||||||||
Net income available to common stockholders | $ | 71,480 | $ | 69,454 | $ | 313,116 | $ | 291,074 | ||||
Basic earnings per common share | $ | 1.42 | $ | 1.38 | $ | 6.23 | $ | 5.83 | ||||
Diluted earnings per common share | $ | 1.42 | $ | 1.38 | $ | 6.21 | $ | 5.79 | ||||
7
TEXAS CAPITAL BANCSHARES, INC. | |||||||||||||||
SUMMARY OF LOAN LOSS EXPERIENCE (UNAUDITED) | |||||||||||||||
(Dollars in thousands) | |||||||||||||||
4th Quarter | 3rd Quarter | 2nd Quarter | 1st Quarter | 4th Quarter | |||||||||||
2019 | 2019 | 2019 | 2019 | 2018 | |||||||||||
Allowance for loan losses: | |||||||||||||||
Beginning balance | $ | 190,138 | $ | 214,572 | $ | 208,573 | $ | 191,522 | $ | 190,306 | |||||
Loans charged-off: | |||||||||||||||
Commercial | 14,280 | 37,760 | 20,053 | 4,865 | 34,419 | ||||||||||
Real estate | 485 | — | 177 | — | — | ||||||||||
Construction | — | — | — | — | — | ||||||||||
Consumer | — | — | — | — | — | ||||||||||
Leases | — | 19 | — | — | — | ||||||||||
Total charge-offs | 14,765 | 37,779 | 20,230 | 4,865 | 34,419 | ||||||||||
Recoveries: | |||||||||||||||
Commercial | 1,953 | 870 | 201 | 266 | 1,399 | ||||||||||
Real estate | — | — | — | — | 26 | ||||||||||
Construction | — | — | — | — | — | ||||||||||
Consumer | 9 | 27 | 23 | 10 | 360 | ||||||||||
Leases | 1 | 9 | — | 1 | 1 | ||||||||||
Total recoveries | 1,963 | 906 | 224 | 277 | 1,786 | ||||||||||
Net charge-offs | 12,802 | 36,873 | 20,006 | 4,588 | 32,633 | ||||||||||
Provision for loan losses | 17,711 | 12,439 | 26,005 | 21,639 | 33,849 | ||||||||||
Ending balance | $ | 195,047 | $ | 190,138 | $ | 214,572 | $ | 208,573 | $ | 191,522 | |||||
Allowance for off-balance sheet credit losses: | |||||||||||||||
Beginning balance | $ | 9,351 | $ | 10,790 | $ | 9,795 | $ | 11,434 | $ | 10,283 | |||||
Provision for off-balance sheet credit losses | (711 | ) | (1,439 | ) | 995 | (1,639 | ) | 1,151 | |||||||
Ending balance | $ | 8,640 | $ | 9,351 | $ | 10,790 | $ | 9,795 | $ | 11,434 | |||||
Total allowance for credit losses | $ | 203,687 | $ | 199,489 | $ | 225,362 | $ | 218,368 | $ | 202,956 | |||||
Total provision for credit losses | $ | 17,000 | $ | 11,000 | $ | 27,000 | $ | 20,000 | $ | 35,000 | |||||
Allowance for loan losses to LHI | 0.79 | % | 0.77 | % | 0.88 | % | 0.89 | % | 0.85 | % | |||||
Allowance for loan losses to average LHI | 0.79 | % | 0.76 | % | 0.90 | % | 0.96 | % | 0.88 | % | |||||
Net charge-offs to average LHI(1) | 0.21 | % | 0.58 | % | 0.34 | % | 0.09 | % | 0.60 | % | |||||
Net charge-offs to average LHI for last twelve months(1) | 0.31 | % | 0.41 | % | 0.27 | % | 0.36 | % | 0.37 | % | |||||
Total provision for credit losses to average LHI(1) | 0.27 | % | 0.17 | % | 0.45 | % | 0.37 | % | 0.64 | % | |||||
Total allowance for credit losses to LHI | 0.83 | % | 0.81 | % | 0.93 | % | 0.93 | % | 0.90 | % | |||||
(1) | Interim period ratios are annualized. |
8
TEXAS CAPITAL BANCSHARES, INC. | |||||||||||||||
SUMMARY OF NON-PERFORMING ASSETS AND PAST DUE LOANS (UNAUDITED) | |||||||||||||||
(Dollars in thousands) | |||||||||||||||
4th Quarter | 3rd Quarter | 2nd Quarter | 1st Quarter | 4th Quarter | |||||||||||
2019 | 2019 | 2019 | 2019 | 2018 | |||||||||||
Non-performing assets (NPAs): | |||||||||||||||
Non-accrual loans | $ | 225,384 | $ | 120,686 | $ | 114,084 | $ | 133,690 | $ | 80,375 | |||||
Other real estate owned (OREO) | — | — | — | — | 79 | ||||||||||
Total LHI NPAs | $ | 225,384 | $ | 120,686 | $ | 114,084 | $ | 133,690 | $ | 80,454 | |||||
Non-accrual loans to LHI | 0.91 | % | 0.49 | % | 0.47 | % | 0.57 | % | 0.36 | % | |||||
Total LHI NPAs to LHI plus OREO | 0.91 | % | 0.49 | % | 0.47 | % | 0.57 | % | 0.36 | % | |||||
Total LHI NPAs to earning assets | 0.71 | % | 0.37 | % | 0.39 | % | 0.49 | % | 0.29 | % | |||||
Allowance for loan losses to non-accrual loans | .9x | 1.6x | 1.9x | 1.6x | 2.4x | ||||||||||
Loans past due 90 days and still accruing(1) | $ | 17,584 | $ | 29,648 | $ | 15,212 | $ | 12,245 | $ | 9,353 | |||||
Loans past due 90 days to LHI | 0.07 | % | 0.12 | % | 0.06 | % | 0.05 | % | 0.04 | % | |||||
LHS past due 90 days and still accruing(2) | $ | 8,207 | $ | 9,187 | $ | 11,665 | $ | 13,693 | $ | 16,829 | |||||
(1) | At December 31, 2019, loans past due 90 days and still accruing includes premium finance loans of $8.5 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 LHS 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. Also includes loans that, pursuant to Ginnie Mae servicing guidelines, we have the unilateral right, but not obligation, to repurchase and thus must record as LHS on our balance sheet regardless of whether the repurchase option has been exercised. |
9
TEXAS CAPITAL BANCSHARES, INC. | |||||||||||||||
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) | |||||||||||||||
(Dollars in thousands) | |||||||||||||||
4th Quarter | 3rd Quarter | 2nd Quarter | 1st Quarter | 4th Quarter | |||||||||||
2019 | 2019 | 2019 | 2019 | 2018 | |||||||||||
Interest income | |||||||||||||||
Interest and fees on loans | $ | 312,147 | $ | 329,344 | $ | 329,842 | $ | 312,703 | $ | 310,470 | |||||
Investment securities | 2,618 | 2,316 | 2,260 | 1,460 | 1,274 | ||||||||||
Federal funds sold and securities purchased under resale agreements | 439 | 554 | 157 | 379 | 984 | ||||||||||
Interest-bearing deposits in other banks | 22,553 | 22,887 | 14,634 | 11,019 | 8,990 | ||||||||||
Total interest income | 337,757 | 355,101 | 346,893 | 325,561 | 321,718 | ||||||||||
Interest expense | |||||||||||||||
Deposits | 70,987 | 80,967 | 72,529 | 69,054 | 61,773 | ||||||||||
Federal funds purchased | 1,319 | 1,835 | 5,202 | 3,516 | 2,097 | ||||||||||
Other borrowings | 11,712 | 14,703 | 20,124 | 11,854 | 11,726 | ||||||||||
Subordinated notes | 4,191 | 4,191 | 4,191 | 4,191 | 4,191 | ||||||||||
Trust preferred subordinated debentures | 1,163 | 1,237 | 1,294 | 1,332 | 1,258 | ||||||||||
Total interest expense | 89,372 | 102,933 | 103,340 | 89,947 | 81,045 | ||||||||||
Net interest income | 248,385 | 252,168 | 243,553 | 235,614 | 240,673 | ||||||||||
Provision for credit losses | 17,000 | 11,000 | 27,000 | 20,000 | 35,000 | ||||||||||
Net interest income after provision for credit losses | 231,385 | 241,168 | 216,553 | 215,614 | 205,673 | ||||||||||
Non-interest income | |||||||||||||||
Service charges on deposit accounts | 2,785 | 2,707 | 2,849 | 2,979 | 3,168 | ||||||||||
Wealth management and trust fee income | 2,342 | 2,330 | 2,129 | 2,009 | 2,152 | ||||||||||
Brokered loan fees | 8,645 | 8,691 | 7,336 | 5,066 | 5,408 | ||||||||||
Servicing income | 4,030 | 3,549 | 3,126 | 2,734 | 2,861 | ||||||||||
Swap fees | 1,559 | 1,196 | 601 | 1,031 | 1,356 | ||||||||||
Net gain/(loss) on sale of LHS | (7,757 | ) | (6,011 | ) | (5,986 | ) | (505 | ) | (8,087 | ) | |||||
Other | 6,157 | 7,839 | 14,309 | 16,700 | 8,422 | ||||||||||
Total non-interest income | 17,761 | 20,301 | 24,364 | 30,014 | 15,280 | ||||||||||
Non-interest expense | |||||||||||||||
Salaries and employee benefits | 80,262 | 80,106 | 76,889 | 77,823 | 69,500 | ||||||||||
Net occupancy expense | 9,075 | 8,125 | 7,910 | 7,879 | 7,390 | ||||||||||
Marketing | 12,807 | 14,753 | 14,087 | 11,708 | 10,208 | ||||||||||
Legal and professional | 22,402 | 11,394 | 10,004 | 10,030 | 13,042 | ||||||||||
Communications and technology | 13,801 | 10,805 | 11,022 | 9,198 | 8,845 | ||||||||||
FDIC insurance assessment | 5,613 | 5,220 | 4,138 | 5,122 | 5,423 | ||||||||||
Servicing related expenses | 2,960 | 8,165 | 6,066 | 5,382 | 2,555 | ||||||||||
Other | 11,770 | 10,802 | 11,445 | 13,236 | 12,899 | ||||||||||
Total non-interest expense | 158,690 | 149,370 | 141,561 | 140,378 | 129,862 | ||||||||||
Income before income taxes | 90,456 | 112,099 | 99,356 | 105,250 | 91,091 | ||||||||||
Income tax expense | 16,539 | 23,958 | 21,387 | 22,411 | 19,200 | ||||||||||
Net income | 73,917 | 88,141 | 77,969 | 82,839 | 71,891 | ||||||||||
Preferred stock dividends | 2,437 | 2,438 | 2,437 | 2,438 | 2,437 | ||||||||||
Net income available to common shareholders | $ | 71,480 | $ | 85,703 | $ | 75,532 | $ | 80,401 | $ | 69,454 | |||||
10
TEXAS CAPITAL BANCSHARES, INC. | ||||||||||||||||||||||||||||||||||||||||||||
CONSOLIDATED DAILY AVERAGE BALANCES, AVERAGE YIELDS AND RATES - UNAUDITED | ||||||||||||||||||||||||||||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||||||||||||||||||||||||||
4th Quarter 2019 | 3rd Quarter 2019 | 2nd Quarter 2019 | 1st Quarter 2019 | 4th Quarter 2018 | ||||||||||||||||||||||||||||||||||||||||
Average Balance | Revenue/ Expense | Yield/ Rate | Average Balance | Revenue/ Expense | Yield/ Rate | Average Balance | Revenue/ Expense | Yield/ Rate | Average Balance | Revenue/ Expense | Yield/ Rate | Average Balance | Revenue/ Expense | Yield/ Rate | ||||||||||||||||||||||||||||||
Assets | ||||||||||||||||||||||||||||||||||||||||||||
Investment securities - Taxable | $ | 40,904 | $ | 693 | 6.72 | % | $ | 39,744 | $ | 357 | 3.56 | % | $ | 38,887 | $ | 287 | 2.96 | % | $ | 30,625 | $ | 274 | 3.62 | % | $ | 23,977 | $ | 259 | 4.29 | % | ||||||||||||||
Investment securities - Non-taxable(2) | 197,591 | 2,437 | 4.89 | % | 200,090 | 2,480 | 4.92 | % | 192,115 | 2,498 | 5.21 | % | 114,341 | 1,501 | 5.33 | % | 93,394 | 1,285 | 5.46 | % | ||||||||||||||||||||||||
Federal funds sold and securities purchased under resale agreements | 102,320 | 439 | 1.70 | % | 100,657 | 554 | 2.18 | % | 28,436 | 157 | 2.22 | % | 63,652 | 379 | 2.41 | % | 173,654 | 984 | 2.25 | % | ||||||||||||||||||||||||
Interest-bearing deposits in other banks | 5,387,000 | 22,553 | 1.66 | % | 4,184,217 | 22,887 | 2.17 | % | 2,491,827 | 14,634 | 2.36 | % | 1,823,106 | 11,019 | 2.45 | % | 1,585,763 | 8,990 | 2.25 | % | ||||||||||||||||||||||||
LHS, at fair value | 3,567,836 | 33,411 | 3.72 | % | 2,555,269 | 26,206 | 4.07 | % | 2,494,883 | 27,607 | 4.44 | % | 2,122,302 | 25,303 | 4.84 | % | 2,049,395 | 24,407 | 4.72 | % | ||||||||||||||||||||||||
LHI, mortgage finance loans | 7,870,888 | 63,114 | 3.18 | % | 8,118,025 | 68,660 | 3.36 | % | 7,032,963 | 63,523 | 3.62 | % | 4,931,879 | 46,368 | 3.81 | % | 5,046,540 | 47,305 | 3.72 | % | ||||||||||||||||||||||||
LHI(1)(2) | 16,667,259 | 216,686 | 5.16 | % | 16,901,391 | 235,557 | 5.53 | % | 16,781,733 | 239,829 | 5.73 | % | 16,866,456 | 242,155 | 5.82 | % | 16,643,559 | 239,995 | 5.72 | % | ||||||||||||||||||||||||
Less allowance for loan losses | 189,353 | — | — | 212,898 | — | — | 206,654 | — | — | 192,122 | — | — | 182,814 | — | — | |||||||||||||||||||||||||||||
LHI, net of allowance | 24,348,794 | 279,800 | 4.56 | % | 24,806,518 | 304,217 | 4.87 | % | 23,608,042 | 303,352 | 5.15 | % | 21,606,213 | 288,523 | 5.42 | % | 21,507,285 | 287,300 | 5.30 | % | ||||||||||||||||||||||||
Total earning assets | 33,644,445 | 339,333 | 4.00 | % | 31,886,495 | 356,701 | 4.44 | % | 28,854,190 | 348,535 | 4.84 | % | 25,760,239 | 326,999 | 5.15 | % | 25,433,468 | 323,225 | 5.04 | % | ||||||||||||||||||||||||
Cash and other assets | 974,866 | 1,000,117 | 940,793 | 894,797 | 828,156 | |||||||||||||||||||||||||||||||||||||||
Total assets | $ | 34,619,311 | $ | 32,886,612 | $ | 29,794,983 | $ | 26,655,036 | $ | 26,261,624 | ||||||||||||||||||||||||||||||||||
Liabilities and Stockholders’ Equity | ||||||||||||||||||||||||||||||||||||||||||||
Transaction deposits | $ | 3,817,294 | $ | 16,428 | 1.71 | % | $ | 3,577,905 | $ | 18,442 | 2.04 | % | $ | 3,475,404 | $ | 18,037 | 2.08 | % | $ | 3,263,976 | $ | 16,001 | 1.99 | % | $ | 3,233,960 | $ | 15,150 | 1.86 | % | ||||||||||||||
Savings deposits | 11,111,326 | 40,603 | 1.45 | % | 10,331,078 | 45,586 | 1.75 | % | 8,896,537 | 40,994 | 1.85 | % | 8,751,200 | 41,673 | 1.93 | % | 8,354,332 | 36,913 | 1.75 | % | ||||||||||||||||||||||||
Time deposits | 2,453,655 | 13,956 | 2.26 | % | 2,706,434 | 16,939 | 2.48 | % | 2,227,460 | 13,498 | 2.43 | % | 2,010,476 | 11,380 | 2.30 | % | 1,886,016 | 9,710 | 2.04 | % | ||||||||||||||||||||||||
Total interest bearing deposits | 17,382,275 | 70,987 | 1.62 | % | 16,615,417 | 80,967 | 1.93 | % | 14,599,401 | 72,529 | 1.99 | % | 14,025,652 | 69,054 | 2.00 | % | 13,474,308 | 61,773 | 1.82 | % | ||||||||||||||||||||||||
Other borrowings | 2,822,465 | 13,031 | 1.83 | % | 2,896,477 | 16,538 | 2.27 | % | 4,018,231 | 25,326 | 2.53 | % | 2,412,254 | 15,370 | 2.58 | % | 2,290,520 | 13,823 | 2.39 | % | ||||||||||||||||||||||||
Subordinated notes | 282,074 | 4,191 | 5.89 | % | 281,979 | 4,191 | 5.90 | % | 281,889 | 4,191 | 5.96 | % | 281,799 | 4,191 | 6.03 | % | 281,708 | 4,191 | 5.90 | % | ||||||||||||||||||||||||
Trust preferred subordinated debentures | 113,406 | 1,163 | 4.07 | % | 113,406 | 1,237 | 4.33 | % | 113,406 | 1,294 | 4.58 | % | 113,406 | 1,332 | 4.76 | % | 113,406 | 1,258 | 4.40 | % | ||||||||||||||||||||||||
Total interest bearing liabilities | 20,600,220 | 89,372 | 1.72 | % | 19,907,279 | 102,933 | 2.05 | % | 19,012,927 | 103,340 | 2.18 | % | 16,833,111 | 89,947 | 2.17 | % | 16,159,942 | 81,045 | 1.99 | % | ||||||||||||||||||||||||
Demand deposits | 10,933,887 | 9,992,406 | 7,929,266 | 7,047,120 | 7,462,392 | |||||||||||||||||||||||||||||||||||||||
Other liabilities | 278,964 | 264,506 | 220,305 | 223,142 | 157,278 | |||||||||||||||||||||||||||||||||||||||
Stockholders’ equity | 2,806,240 | 2,722,421 | 2,632,485 | 2,551,663 | 2,482,012 | |||||||||||||||||||||||||||||||||||||||
Total liabilities and stockholders’ equity | $ | 34,619,311 | $ | 32,886,612 | $ | 29,794,983 | $ | 26,655,036 | $ | 26,261,624 | ||||||||||||||||||||||||||||||||||
Net interest income(2) | $ | 249,961 | $ | 253,768 | $ | 245,195 | $ | 237,052 | $ | 242,180 | ||||||||||||||||||||||||||||||||||
Net interest margin | 2.95 | % | 3.16 | % | 3.41 | % | 3.73 | % | 3.78 | % | ||||||||||||||||||||||||||||||||||
(1) | The loan averages include loans on which the accrual of interest has been discontinued and are stated net of unearned income. |
(2) | Taxable equivalent rates used where applicable. |
11