Press Release

Texas Capital Bancshares Announces Operating Results for Q3 2009

Company Release - 10/21/2009 4:02 PM ET

DALLAS--(BUSINESS WIRE)-- Texas Capital Bancshares, Inc. (NASDAQ: TCBI), the parent company of Texas Capital Bank, announced earnings and operating results for the third quarter of 2009.

    --  Loans held for investment increased 2% and total loans increased 2% on a
        linked quarter basis and grew 12% and 16%, respectively, from Q3 2008
    --  Demand deposits grew 10% and total deposits increased 7% on a linked
        quarter basis and grew 43% and 16%, respectively, from Q3 2008
    --  Net income before preferred dividends decreased 17% on a linked quarter
        basis and decreased 29% from Q3 2008
    --  EPS increased 150% on a linked quarter basis, due to the reduction in
        preferred stock dividends related to the TARP that was repaid in Q2, and
        decreased 44% from Q3 2008

"Our core earnings power improved, even in the overall economic downturn and the increased pressure on credit," said George Jones, CEO. "Our growth in loans, demand deposits and the improvement in net interest margin are indicators of success in this challenging environment."


FINANCIAL SUMMARY

(dollars and shares in thousands)

                                   Q3 2009        Q3 2008        % Change

QUARTERLY OPERATING RESULTS

Net Income                         $ 5,353        $ 7,565        (29 )%

Diluted EPS                        $ .15          $ .27          (44 )%

ROA                                  .40       %    .65       %

ROE                                  4.46      %    9.12      %

Diluted Shares                       36,304         27,793

BALANCE SHEET

Total Assets                       $ 5,317,851    $ 4,742,043    12  %

Demand Deposits                      802,692        561,227      43  %

Total Deposits                       3,916,568      3,388,963    16  %

Loans Held for Investment            4,290,453      3,840,172    12  %

Total Loans                          4,840,240      4,183,174    16  %

Stockholders' Equity                 474,044        380,858      24  %



DETAILED FINANCIALS

Texas Capital Bancshares, Inc. reported net income from continuing operations of $5.4 million for the quarter ended September 30, 2009 compared to $7.6 million for the third quarter of 2008. On a fully diluted basis, earnings per common share from continuing operations were $.15 for the three months ended September 30, 2009, compared to $.27 for the same quarter last year. The discussion below relates only to continuing operations.

Return on average equity was 4.46 percent and return on average assets was .40 percent for the third quarter of 2009, compared to 9.12 percent and .65 percent, respectively for the third quarter of 2008. The reduction in the ROE resulted from the 24 percent increase in stockholders' equity from two equity offerings since September 2008 and reduced earnings.

Net interest income was $51.6 million for the third quarter of 2009, compared to $38.3 million for the third quarter of 2008. The increase was due to an increase in average earning assets of $645.3 million over levels reported in the third quarter of 2008. The increase in average earning assets included a $482.9 million increase in average loans held for investment and an increase of $251.8 million in average loans held for sale, offset by a decrease of $80.0 million in average securities.

The net interest margin in the third quarter of 2009 was 4.06 percent, a 59 basis point increase from the third quarter of 2008 and an 18 basis point increase from the second quarter of 2009 due to low funding costs and our ability to maintain and improve yields on our earning assets.

Average total deposits increased by $529.2 million from the third quarter of 2008 and increased by $664.5 million from the second quarter of 2009. For the same periods, the average balance of demand deposits increased by $196.6 million, or 35 percent, to $764.6 million from $567.9 million during the third quarter of 2008 and increased $40.1 million, or 6 percent, from the second quarter of 2009.

As a result of the overall economic downturn, we have experienced increases in levels of non-performing assets and exposure to credit losses. Provision for loan losses and valuation allowance related to OREO totaled $15.7 million in third quarter of 2009 compared to $4.0 million in the third quarter of 2008 and $11.0 million in the second quarter of 2009. The Company recorded a $13.5 million provision for loan losses in the third quarter of 2009, compared to $4.0 million in the third quarter of 2008 and $11.0 million in the second quarter of 2009. The third quarter provision resulted in an increase in the reserve to 1.59 percent of loans held for investment as compared to 1.07 percent at September 30, 2008, and 1.35 percent at the end of the second quarter of 2009. In management's opinion, the reserve is adequate and is derived from consistent application of the methodology for establishing the adequacy of reserves for Texas Capital Bank's loan portfolio. In the third quarter of 2009, net charge-offs were $2.0 million, compared to net charge-offs of $1.5 million in the third quarter of 2008 and net charge-offs of $6.8 million in the second quarter of 2009. Non-accrual loans were $85.3 million, or 1.99 percent, of loans at the end of the third quarter of 2009, compared to $46.6 million, or 1.21 percent of loans at the end of the third quarter of 2008, and $49.6 million, or 1.18 percent of loans at the end of the second quarter of 2009. At September 30, 2009, total other real estate owned (OREO) was $34.7 million compared to $5.8 million at the end of the third quarter of 2008, and $31.4 million at the end of the second quarter of 2009. The balance of $34.7 million at September 30, 2009 is stated net of a valuation allowance for which the Company incurred a non-interest expense of $2.2 million during the third quarter of 2009.

Non-interest income for the third quarter of 2009 increased $2.2 million, or 45 percent, to $7.1 million from $4.9 million in the third quarter of 2008. The increase is primarily related to a $1.1 million increase in brokered loan fees and a $497,000 increase in service charge income, offset by a $234,000 decrease in trust fee income. Additionally, other non-interest income increased $1.0 million due to a $1.0 million charge associated with customer fraud on certain mortgage loans that was recorded in other non-interest income in the third quarter of 2008.

Non-interest expense for the third quarter of 2009 increased $9.4 million, or 34 percent, to $37.1 million from $27.7 million in the third quarter of 2008. The increase is primarily related to a $3.6 increase in salaries and employee benefits to $19.6 million from $16.0 million, which was primarily due to general business growth. Valuation allowance for foreclosed assets and other carrying costs expense increased $2.2 million related to establishing a valuation allowance of $2.2 million. The expense related to the valuation allowance increased our efficiency ratio from 59.4 percent to 63.1 percent for the third quarter. Additionally, legal and professional expense and FDIC assessment expense increased $916,000 and $1.0 million, respectively, from the third quarter 2008.

Stockholders' equity increased by 24 percent from $380.9 million in September 2008 to $474.0 million at the end of the third quarter of 2009. Contributing to the increase was retained net income of $21.4 million and proceeds of sales of common stock totaling $114.4 million. The Bank is well capitalized under regulatory guidelines and at September 30, 2009, the Company's ratio of tangible common equity to total tangible assets was 8.7 percent.

ABOUT TEXAS CAPITAL BANCSHARES, INC.

Texas Capital Bancshares, Inc. (NASDAQ: TCBI) is the parent company of Texas Capital Bank, a commercial bank that delivers highly personalized financial services to businesses and private clients. Headquartered in Dallas, the Bank has full-service locations in Austin, Dallas, Fort Worth, Houston and San Antonio.

This release contains forward-looking statements, which are subject to risks and uncertainties. A number of factors, many of which are beyond Texas Capital Bancshares' control, could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. These risks and uncertainties include the risk of adverse impacts from general economic conditions, competition, interest rate sensitivity and exposure to regulatory and legislative changes. These and other factors that could cause results to differ materially from those described in the forward-looking statements can be found in the Form 10-K and other filings made by Texas Capital Bancshares with the Securities and Exchange Commission.


TEXAS CAPITAL BANCSHARES, INC.

SELECTED FINANCIAL HIGHLIGHTS (UNAUDITED)

(Dollars in thousands except per share data)

               3rd Quarter     2nd Quarter     1st Quarter     4th Quarter     3rd Quarter

               2009            2009            2009            2008            2008

CONSOLIDATED
STATEMENT OF
INCOME

Interest       $ 62,197        $ 60,013        $ 55,806        $ 58,873        $ 62,240
income

Interest         10,631          11,211          14,589          20,161          23,974
expense

Net interest     51,566          48,802          41,217          38,712          38,266
income

Provision for    13,500          11,000          8,500           11,000          4,000
loan losses

Net interest
income after     38,066          37,802          32,717          27,712          34,266
provision for
loan losses

Non-interest     7,133           7,416           6,900           5,950           4,885
income

Non-interest     37,067          35,373          30,306          28,443          27,675
expense

Income from
continuing
operations       8,132           9,845           9,311           5,219           11,476
before income
taxes

Income tax       2,779           3,363           3,186           1,732           3,911
expense

Income from
continuing       5,353           6,482           6,125           3,487           7,565
operations

Loss from
discontinued     (41        )    (44        )    (95        )    (100       )    (252       )
operations
(after-tax)

Net income       5,312           6,438           6,030           3,387           7,313

Preferred
stock            -               4,453           930             -               -
dividends

Net income
available to   $ 5,312         $ 1,985         $ 5,100         $ 3,387         $ 7,313
common
shareholders

Diluted EPS
from           $ .15           $ .06           $ .17           $ .11           $ .27
continuing
operations

Diluted EPS    $ .15           $ .06           $ .16           $ .11           $ .26

Diluted          36,303,975      33,866,237      31,072,444      31,037,610      27,792,938
shares

CONSOLIDATED
BALANCE SHEET
DATA

Total assets   $ 5,317,851     $ 5,303,800     $ 5,009,931     $ 5,139,564     $ 4,742,043

Loans held
for              4,290,453       4,211,304       4,019,247       4,027,871       3,840,172
investment

Loans held       549,787         544,652         426,982         496,351         343,002
for sale

Securities       285,869         308,187         361,898         378,752         365,145

Demand           802,692         730,034         608,939         587,161         561,227
deposits

Total            3,916,568       3,643,582       3,010,960       3,333,187       3,388,963
deposits

Other            790,192         1,059,572       1,386,783       1,280,607       835,025
borrowings

Long-term        113,406         113,406         113,406         113,406         113,406
debt

Stockholders'    474,044         464,026         471,990         387,073         380,858
equity

End of period    35,802,485      35,688,661      31,014,575      30,971,189      30,844,202
shares

Book value
(excluding     $ 13.05         $ 12.87         $ 12.64         $ 12.44         $ 12.33
securities
gains/losses)

Tangible book
value
(excluding     $ 12.84         $ 12.66         $ 12.39         $ 12.19         $ 12.08
securities
gains/losses)

SELECTED
FINANCIAL
RATIOS

From
continuing
operations:

Net interest     4.06       %    3.88       %    3.39       %    3.41       %    3.47       %
margin

Return on
average          .40        %    .49        %    .48        %    .29        %    .65        %
assets

Return on
average          4.46       %    5.45       %    5.44       %    3.61       %    9.12       %
equity

Non-interest
income to        .56        %    .59        %    .56        %    .52        %    .44        %
earning
assets

Efficiency       63.1       %    62.9       %    63.0       %    63.7       %    64.1       %
ratio

Non-interest
expense to       2.91       %    2.80       %    2.48       %    2.49       %    2.49       %
earning
assets

From
consolidated:

Net interest     4.06       %    3.88       %    3.39       %    3.41       %    3.47       %
margin

Return on
average          .40        %    .48        %    .47        %    .28        %    .63        %
assets

Return on
average          4.43       %    5.41       %    5.36       %    3.50       %    8.81       %
equity

Tangible
common equity
to total         8.7        %    8.6        %    7.8        %    7.4        %    7.9        %
tangible
assets

Tier 1           11.2       %    11.2       %    11.9       %    10.0       %    10.5       %
capital ratio

Total capital    12.5       %    12.3       %    13.0       %    10.9       %    11.4       %
ratio

Tier 1
leverage         10.8       %    10.6       %    11.0       %    10.2       %    10.5       %
ratio




TEXAS CAPITAL BANCSHARES, INC.

CONSOLIDATED BALANCE SHEETS (UNAUDITED)

(Dollars in thousands)

                                           September 30,  September 30,  %

                                           2009           2008           Change

Assets

Cash and due from banks                    $ 60,365       $ 64,738       (7   )%

Federal funds sold                           240            3,050        (92  )%

Securities, available-for-sale               285,869        365,145      (22  )%

Loans held for sale                          549,787        343,002      60   %

Loans held for sale from discontinued        589            648          (9   )%
operations

Loans held for investment (net of            4,290,453      3,840,172    12   %
unearned income)

Less: Allowance for loan losses              68,368         40,998       67   %

Loans held for investment, net               4,222,085      3,799,174    11   %

Premises and equipment, net                  11,473         6,081        89   %

Accrued interest receivable and other        180,465        153,124      18   %
assets

Goodwill and intangibles, net                7,567          7,729        (2   )%

Total assets                               $ 5,318,440    $ 4,742,691    12   %

Liabilities and Stockholders' Equity

Liabilities:

Deposits:

Non-interest bearing                       $ 802,692      $ 561,227      43   %

Interest bearing                             2,720,011      2,143,944    27   %

Interest bearing in foreign branches         393,865        683,792      (42  )%

Total deposits                               3,916,568      3,388,963    16   %

Accrued interest payable                     2,516          5,508        (54  )%

Other liabilities                            21,714         18,931       15   %

Federal funds purchased                      616,029        240,405      156  %

Repurchase agreements                        65,422         42,032       56   %

Other short-term borrowings                  108,741        552,588      (80  )%

Trust preferred subordinated debentures      113,406        113,406      -

Total liabilities                            4,844,396      4,368,833    11   %

Stockholders' equity:

Common stock, $.01 par value:

Authorized shares - 100,000,000

Issued shares - 35,802,485 and 30,844,202
at September 30, 2009 and 2008,              358            308          16   %
respectively

Additional paid-in capital                   324,724        253,599      28   %

Retained earnings                            142,248        126,464      12   %

Treasury stock (shares at cost: 417 at
September 30, 2009 and 84,691 at             (8        )    (581      )  (99  )%
September 30, 2008)

Deferred compensation                        -              573          (100 )%

Accumulated other comprehensive income,      6,722          495          N/M
net of taxes

Total stockholders' equity                   474,044        380,858      24   %

Total liabilities and stockholders'        $ 5,318,440    $ 4,742,691    12   %
equity




TEXAS CAPITAL BANCSHARES, INC.

CONSOLIDATED STATEMENTS OF
INCOME (UNAUDITED)

(Dollars in thousands except
per share data)

                                Three Months Ended      Nine Months Ended

                                September 30            September 30

                                2009        2008        2009         2008

Interest income

Interest and fees on loans      $ 58,959    $ 57,909    $ 167,326    $ 176,195

Securities                        3,226       4,281       10,621       13,691

Federal funds sold                5           40          29           141

Deposits in other banks           7           10          40           30

Total interest income             62,197      62,240      178,016      190,057

Interest expense

Deposits                          8,916       18,338      29,264       56,777

Federal funds purchased           586         2,273       1,944        7,186

Repurchase agreements             14          86          42           462

Other borrowings                  125         1,791       1,873        7,770

Trust preferred subordinated      990         1,486       3,308        4,837
debentures

Total interest expense            10,631      23,974      36,431       77,032

Net interest income               51,566      38,266      141,585      113,025

Provision for loan losses         13,500      4,000       33,000       15,750

Net interest income after         38,066      34,266      108,585      97,275
provision for loan losses

Non-interest income

Service charges on deposit        1,658       1,161       4,797        3,566
accounts

Trust fee income                  1,000       1,234       2,836        3,656

Bank owned life insurance         418         299         1,115        925
(BOLI) income

Brokered loan fees                2,120       1,024       6,822        2,168

Equipment rental income           1,291       1,487       4,200        4,513

Other                             646         (320   )    1,679        1,692

Total non-interest income         7,133       4,885       21,449       16,520

Non-interest expense

Salaries and employee benefits    19,569      16,039      53,788       46,750

Net occupancy expense             3,164       2,300       9,305        7,097

Leased equipment depreciation     1,050       1,153       3,288        3,525

Marketing                         705         521         1,915        1,847

Legal and professional            3,274       2,358       8,816        6,829

Communications and data           935         858         2,750        2,482
processing

FDIC insurance assessment         1,452       432         6,492        1,154

Allowance and other carrying      2,390       239         3,968        668
costs for OREO

Other                             4,528       3,775       12,424       10,856

Total non-interest expense        37,067      27,675      102,746      81,208

Income from continuing            8,132       11,476      27,288       32,587
operations before income taxes

Income tax expense                2,779       3,911       9,328        11,192

Income from continuing            5,353       7,565       17,960       21,395
operations

Loss from discontinued            (41    )    (252   )    (180    )    (516    )
operations (after-tax)

Net income                        5,312       7,313       17,780       20,879

Preferred stock dividends         -           -           5,383        -

Net income available to common  $ 5,312     $ 7,313     $ 12,397     $ 20,879
stockholders

Basic earnings per common
share:

Income from continuing          $ .15       $ .27       $ .38        $ .79
operations

Net income                      $ .15       $ .26       $ .37        $ .77

Diluted earnings per common
share:

Income from continuing          $ .15       $ .27       $ .37        $ .79
operations

Net income                      $ .15       $ .26       $ .37        $ .77




TEXAS CAPITAL BANCSHARES, INC.

SUMMARY OF LOAN LOSS EXPERIENCE

(Dollars in thousands)

                 3rd Quarter  2nd Quarter  1st Quarter  4th Quarter  3rd Quarter

                 2009         2009         2009         2008         2008

Beginning        $ 56,893     $ 52,727     $ 46,835     $ 40,998     $ 38,460
balance

Loans
charged-off:

Commercial         115          92           1,695        535          592

Real estate -      576          1,821        60           1,195        553
construction

Real estate -      1,239        1,250        236          3,432        267
term

Consumer           80           -            419          64           129

Leases             72           3,724        226          -            -

Total              2,082        6,887        2,636        5,226        1,541

Recoveries:

Commercial         21           48           21           43           27

Consumer           16           5            -            -            13

Leases             20           -            -            -            12

Real estate -      -            -            7            -            -
construction

Real estate -      -            -            -            20           27
term

Total              57           53           28           63           79
recoveries

Net charge-offs    2,025        6,834        2,608        5,163        1,462

Provision for      13,500       11,000       8,500        11,000       4,000
loan losses

Ending balance   $ 68,368     $ 56,893     $ 52,727     $ 46,835     $ 40,998

Reserve to
loans held for     1.59    %    1.35   %     1.31   %     1.16   %     1.07   %
investment(2)

Reserve to
average loans      1.60    %    1.38   %     1.31   %     1.21   %     1.08   %
held for
investment(2)

Net charge-offs
to average         .19     %    .66    %     .26    %     .53    %     .15    %
loans(1)(2)

Net charge-offs
to average
loans for last     .41     %    .41    %     .34    %     .35    %     .28    %
twelve months
(1)(2)

Provision for
loan losses to     1.26    %    1.07   %     .85    %     1.13   %     .42    %
average loans
(1)(2)

Non-performing
assets (NPAs):
(4)

Non-accrual      $ 85,270     $ 49,592     $ 50,683     $ 47,499     $ 46,579
loans

Other real
estate owned       34,671       31,404       27,501       25,904       5,792
(OREO)(5)

Total            $ 119,941    $ 80,996     $ 78,184     $ 73,403     $ 52,371

Non-accrual
loans to loans     1.99    %    1.18   %     1.26   %     1.18   %     1.21   %
(2)

Total NPAs to      2.77    %    1.91   %     1.93   %     1.81   %     1.36   %
loans plus OREO

Reserve to
non-accrual      .8x          1.1x         1.0x         1.0x         .9x
loans

Loans past due
90 days and      $ 7,569      $ 3,539      $ 4,637      $ 4,115      $ 2,970
still accruing
(3)

Loans past due
90 days to         .18     %    .08    %     .12    %     .10    %     .08    %
loans(2)



(1) Interim period ratios are annualized.

(2) Excludes loans held for sale.

(3) At September 30, 2009, loans past due 90 days and still accruing includes premium finance loans of $2.6 million. These loans are primarily secured by obligations of insurance carriers to refund premiums on cancelled insurance policies. The refund of premiums from the insurance carriers can take 180 days or longer from the cancellation date.

(4) At September 30, 2009, non-performing assets include $3.1 million of mortgage warehouse loans which were transferred to the loans held for investment portfolio at lower of cost or market, and some were subsequently moved to other real estate owned.

(5) At September 30, 2009, OREO balance is net of $2.2 million valuation allowance.


TEXAS CAPITAL BANCSHARES, INC.

CONSOLIDATED STATEMENT OF INCOME (UNAUDITED)

(Dollars in thousands)

                 3rd Quarter  2nd Quarter  1st Quarter  4th Quarter  3rd Quarter

                 2009         2009         2009         2008         2008

Interest income

Interest and     $ 58,959     $ 56,455     $ 51,912     $ 54,814     $ 57,909
fees on loans

Securities         3,226        3,544        3,851        4,031        4,281

Federal funds      5            9            15           27           40
sold

Deposits in        7            5            28           1            10
other banks

Total interest     62,197       60,013       55,806       58,873       62,240
income

Interest
expense

Deposits           8,916        8,769        11,579       16,075       18,338

Federal funds      586          740          618          1,046        2,273
purchased

Repurchase         14           14           14           79           86
agreements

Other              125          570          1,178        1,353        1,791
borrowings

Trust preferred
subordinated       990          1,118        1,200        1,608        1,486
debentures

Total interest     10,631       11,211       14,589       20,161       23,974
expense

Net interest       51,566       48,802       41,217       38,712       38,266
income

Provision for      13,500       11,000       8,500        11,000       4,000
loan losses

Net interest
income after       38,066       37,802       32,717       27,712       34,266
provision for
loan losses

Non-interest
income

Service charges
on deposit         1,658        1,614        1,525        1,133        1,161
accounts

Trust fee          1,000        952          884          1,036        1,234
income

Bank owned life
insurance          418          423          274          315          299
(BOLI) income

Brokered loan      2,120        2,670        2,032        1,074        1,024
fees

Equipment          1,291        1,453        1,456        1,482        1,487
rental income

Other              646          304          729          910          (320   )

Total
non-interest       7,133        7,416        6,900        5,950        4,885
income

Non-interest
expense

Salaries and
employee           19,569       18,000       16,219       14,688       16,039
benefits

Net occupancy      3,164        3,387        2,754        2,534        2,300
expense

Leased
equipment          1,050        1,115        1,123        1,142        1,153
depreciation

Marketing          705          655          555          882          521

Legal and          3,274        3,291        2,251        2,793        2,358
professional

Communications
and data           935          979          836          832          858
processing

FDIC insurance     1,452        3,493        1,547        643          432
assessment

Allowance and
other carrying     2,390        378          1,200        873          239
costs for OREO

Other              4,528        4,075        3,821        4,056        3,775

Total
non-interest       37,067       35,373       30,306       28,443       27,675
expense

Income from
continuing
operations         8,132        9,845        9,311        5,219        11,476
before income
taxes

Income tax         2,779        3,363        3,186        1,732        3,911
expense

Income from
continuing         5,353        6,482        6,125        3,487        7,565
operations

Loss from
discontinued       (41    )     (44    )     (95    )     (100   )     (252   )
operations
(after-tax)

Net income         5,312        6,438        6,030        3,387        7,313

Preferred stock    -            4,453        930          -            -
dividends

Net income
available to     $ 5,312      $ 1,985      $ 5,100      $ 3,387      $ 7,313
common
stockholders




TEXAS CAPITAL BANCSHARES, INC.

QUARTERLY FINANCIAL SUMMARY - UNAUDITED

Consolidated Daily Average Balances, Average Yields and Rates

Continuing Operations

(Dollars in thousands)

               3rd Quarter 2009               2nd Quarter 2009               1st Quarter 2009                4th Quarter 2008               3rd Quarter 2008

               Average      Revenue/  Yield/  Average      Revenue/  Yield/  Average      Average   Average  Average      Revenue/  Yield/  Average      Revenue/  Yield/

               Balance      Expense   Rate    Balance      Expense   Rate    Balance      Balance   Balance  Balance      Expense   Rate    Balance      Expense   Rate
                            (1)                            (1)                                                            (1)                            (1)

Assets

Securities -   $ 247,936    $ 2,813   4.50 %  $ 280,372    $ 3,124   4.47 %  $ 321,802    $ 3,431   4.32 %   $ 313,992    $ 3,610   4.57 %  $ 325,317    $ 3,852   4.71 %
Taxable

Securities -
Non-taxable      44,642       635     5.64 %    45,901       646     5.64 %    46,055       646     5.69 %     46,272       648     5.57 %    47,271       660     5.55 %
(2)

Federal funds    6,782        5       0.29 %    5,649        9       0.64 %    14,923       15      0.41 %     23,050       27      0.47 %    8,001        40      1.99 %
sold

Deposits in      12,649       7       0.22 %    12,268       5       0.16 %    11,207       28      1.01 %     5,761        1       0.07 %    2,554        10      1.56 %
other banks

Loans held       539,889      6,881   5.06 %    656,462      7,775   4.75 %    587,401      6,487   4.48 %     316,409      4,441   5.58 %    288,103      4,137   5.71 %
for sale

Loans held
for              4,264,202    52,078  4.85 %    4,124,937    48,680  4.73 %    4,022,180    45,425  4.58 %     3,875,586    50,373  5.17 %    3,781,289    53,772  5.66 %
investment

Less reserve
for loan         56,429       -       -         51,601       -       -         46,686       -       -          38,145       -       -         38,180       -       -
losses

Loans, net of    4,747,662    58,959  4.93 %    4,729,798    56,455  4.79 %    4,562,895    51,912  4.61 %     4,153,850    54,814  5.25 %    4,031,212    57,909  5.71 %
reserve

Total earning    5,059,671    62,419  4.89 %    5,073,988    60,239  4.76 %    4,956,882    56,032  4.58 %     4,542,925    59,100  5.18 %    4,414,355    62,471  5.63 %
assets

Cash and         245,564                        251,960                        238,723                         218,335                        201,589
other assets

Total assets   $ 5,305,235                    $ 5,325,948                    $ 5,195,605                     $ 4,761,260                    $ 4,615,944

Liabilities
and
Stockholders'
Equity

Transaction    $ 144,944    $ 58      0.16 %  $ 135,756    $ 55      0.16 %  $ 129,850    $ 44      0.14 %   $ 103,111    $ 67      0.26 %  $ 103,905    $ 122     0.47 %
deposits

Savings          1,377,712    3,090   0.89 %    974,275      2,003   0.82 %    745,355      1,420   0.77 %     729,337      2,350   1.28 %    778,956      3,371   1.72 %
deposits

Time deposits    1,284,220    4,245   1.31 %    1,082,691    5,105   1.89 %    1,277,824    8,066   2.56 %     1,405,426    10,603  3.00 %    1,275,798    10,524  3.28 %

Deposits in
foreign          404,545      1,523   1.49 %    394,251      1,606   1.63 %    444,549      2,049   1.87 %     555,573      3,055   2.19 %    720,211      4,321   2.39 %
branches

Total
interest         3,211,421    8,916   1.10 %    2,586,973    8,769   1.36 %    2,597,578    11,579  1.81 %     2,793,447    16,075  2.29 %    2,878,870    18,338  2.53 %
bearing
deposits

Other            724,127      725     0.40 %    1,404,881    1,324   0.38 %    1,367,691    1,810   0.54 %     881,868      2,478   1.12 %    709,157      4,150   2.33 %
borrowings

Trust
preferred        113,406      990     3.46 %    113,406      1,118   3.95 %    113,406      1,200   4.29 %     113,406      1,608   5.64 %    113,406      1,486   5.21 %
subordinated
debentures

Total
interest         4,048,954    10,631  1.04 %    4,105,260    11,211  1.10 %    4,078,675    14,589  1.45 %     3,788,721    20,161  2.12 %    3,701,433    23,974  2.58 %
bearing
liabilities

Demand           764,557                        724,487                        636,704                         566,513                        567,914
deposits

Other            15,617                         18,899                         23,619                          21,323                         16,452
liabilities

Stockholders'    476,107                        477,302                        456,607                         384,703                        330,145
equity

Total
liabilities
and            $ 5,305,235                    $ 5,325,948                    $ 5,195,605                     $ 4,761,260                    $ 4,615,944
stockholders'
equity

Net interest                $ 51,788                       $ 49,028                       $ 41,443                        $ 38,939                       $ 38,497
income

Net interest                          4.06 %                         3.88 %                         3.39 %                          3.41 %                         3.47 %
margin



(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.


    Source: Texas Capital Bancshares, Inc.
Contact: Texas Capital Bancshares, Inc. Myrna Vance, 214-932-6646 myrna.vance@texascapitalbank.com

Contact Information

Texas Capital Bancshares, Inc.,
2000 McKinney Avenue
Suite 700
Dallas, TX 75201
(214) 932-6600

Investor Relations Contact
Heather Worley
(214) 932-6646
heather.worley@
texascapitalbank.com

Transfer Agent
Computershare Investor Services LLC
Two North Lasalle Street
Third Floor
Chicago, IL 60602
(800) 568-3476
(312) 588-4990

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