Press Release

Texas Capital Bancshares Announces Operating Results for Q1 2010

Company Release - 4/21/2010 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 first quarter of 2010.

    --  Net income increased 18% on a linked quarter basis and 24% from Q1 2009
    --  EPS increased 17% on a linked quarter basis and 24% for the first
        quarter of 2010 as compared to the same quarter of 2009
    --  Demand deposits grew 11% and total deposits increased 7% on a linked
        quarter basis and grew 63% and 46%, respectively, from Q1 2009
    --  Loans held for investment remained consistent on a linked quarter basis
        and total loans decreased 2% on a linked quarter basis; grew 11% and
        13%, respectively, from Q1 2009

"We are pleased to report another quarter in which our core earnings power improved. We had strong deposit growth and loan growth which outpaced that of peers in Texas and throughout the nation," said George Jones, CEO. "In a challenging environment for our industry, we have maintained solid profitability and have a strong equity capital base to support our business objectives."


FINANCIAL SUMMARY

(dollars and shares in thousands)

                                Q1 2010        Q1 2009        % Change

QUARTERLY OPERATING RESULTS

Net Income(1)                   $ 7,600        $ 6,125        24       %

Net Income Available to Common  $ 7,600        $ 5,195        46       %
Shareholders(1)

Diluted EPS(1)                  $ .21          $ .17          24       %

ROA(1)                            .57       %    .48       %

ROE(1)                            6.21      %    5.44      %

Diluted Shares                    36,784         31,072

BALANCE SHEET

Total Assets(1)                 $ 5,499,599    $ 5,012,513    10       %

Demand Deposits                   994,096        608,939      63       %

Total Deposits                    4,409,819      3,010,960    46       %

Loans Held for Investment         4,443,456      4,019,247    11       %

Total Loans(1)                    5,035,892      4,446,229    13       %

Stockholders' Equity              499,996        471,990      6        %



(1) From continuing operations

DETAILED FINANCIALS

Texas Capital Bancshares, Inc. reported net income from continuing operations of $7.6 million for the quarter ended March 31, 2010, compared to $6.1 million for the first quarter of 2009. Net income available to common shareholders from continuing operations was $7.6 million for the quarter ended March 31, 2010 compared to $5.2 million for the first quarter of 2009. On a fully diluted basis, earnings per common share from continuing operations were $.21 for the three months ended March 31, 2010 compared to $.17 for the same period last year. The discussion below relates only to continuing operations.

Return on average equity was 6.21 percent and return on average assets was .57 percent for the first quarter of 2010, compared to 5.44 percent and .48 percent, respectively for the first quarter of 2009.

The net interest margin in the first quarter of 2010 was 4.43 percent, a 104 basis point increase from the first quarter of 2009 and a 22 basis point increase from the fourth quarter of 2009 due to the significant reduction in funding costs and our ability to maintain and improve spreads on our loans. Net interest income was $55.2 million for the first quarter of 2010, compared to $41.2 million for the first quarter of 2009. The increase was due to an increase in average earning assets of $121.0 million over levels reported in the first quarter of 2009. The increase in average earning assets included a $391.8 million increase in average loans held for investment, offset by a decrease of $129.9 million in average loans held for sale and a decrease of $114.6 million in average securities.

Average total deposits for the first quarter of 2010 increased by $1.1 billion from the first quarter of 2009 and increased by $60.1 million from the fourth quarter of 2009. For the same periods, the average balance of demand deposits increased by $319.7 million, or 50 percent, to $956.4 million from $636.7 million during the first quarter of 2009 and increased $42.1 million, or 5 percent, from the fourth 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 during the first quarter of 2010. Provision for credit losses, valuation allowance and direct write-downs related to other real estate owned ("OREO") totaled $15.4 million in first quarter of 2010 compared to $8.5 million in the first quarter of 2009 and $16.1 million in the fourth quarter of 2009. The Company recorded a $13.5 million provision for credit losses in the first quarter of 2010, compared to $8.5 million in the first quarter of 2009 and $10.5 million in the fourth quarter of 2009. The first quarter provision resulted in an increase in the combined reserve to 1.69 percent of loans held for investment as compared to 1.31 percent at March 31, 2009, and 1.59 percent at the end of the fourth 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 first quarter of 2010, net charge-offs were $9.3 million, compared to net charge-offs of $2.6 million in the first quarter of 2009 and net charge-offs of $8.0 million in the fourth quarter of 2009. Non-accrual loans were $115.9 million, or 2.61 percent, of loans at the end of the first quarter of 2010, compared to $50.7 million, or 1.26 percent of loans at the end of the first quarter of 2009, and $95.6 million, or 2.15 percent of loans at the end of the fourth quarter of 2009. At March 31, 2010, total OREO was $28.9 million compared to $27.5 million at the end of the first quarter of 2009, and $27.3 million at the end of the fourth quarter of 2009. The balance of $28.9 million at March 31, 2010 is stated net of an $8.5 million valuation allowance, for which we incurred a non-interest expense of $1.8 million during the first quarter of 2010. We also incurred an additional $111,000 in direct OREO write-downs during the first quarter of 2010.

Non-interest income for the first quarter of 2010 remained consistent at $6.9 million as compared to the first quarter of 2009.

Non-interest expense for the first quarter of 2010 increased $6.9 million, or 23 percent, to $37.2 million from $30.3 million in the first quarter of 2009. The increase is primarily related to a $3.9 million increase in salaries and employee benefits to $20.1 million from $16.2 million, which was primarily due to general business growth. Allowance and other carrying costs for OREO expense increased $1.1 million to $2.3 million related to deteriorating values of assets held in OREO. Of the $2.3 million expense, $1.8 million was related to increasing the valuation allowance and $111,000 related to direct write-downs of the OREO balance. Excluding the expense related to the valuation allowance increase, our efficiency ratio improved to 56.7 percent in the first quarter of 2010 from 59.1 percent in the fourth quarter of 2009 and from 63.0% in the first quarter of 2009.

Stockholders' equity increased by 6 percent from $472.0 million at March 31, 2009 to $500.0 million at March 31, 2010. Contributing to the increase was retained net income and proceeds of sales of common stock. During the first quarter of 2010, we sold approximately 548,000 shares of common stock with net proceeds of $8.9 million under the discretionary equity issuance program announced in January 2010. The Bank is well capitalized under regulatory guidelines and at March 31, 2010, the Company's ratio of tangible common equity to total tangible assets was 8.8 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)

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

                         2010            2009            2009            2009            2009

CONSOLIDATED
STATEMENT OF INCOME

Interest income        $ 64,306        $ 65,137        $ 62,197        $ 60,013        $ 55,806

Interest expense         9,078           10,031          10,631          11,211          14,589

Net interest income      55,228          55,106          51,566          48,802          41,217

Provision for credit     13,500          10,500          13,500          11,000          8,500
losses

Net interest income
after provision for      41,728          44,606          38,066          37,802          32,717
credit losses

Non-interest income      6,948           7,811           7,133           7,416           6,900

Non-interest expense     37,186          42,796          37,067          35,373          30,306

Income from
continuing operations    11,490          9,621           8,132           9,845           9,311
before income taxes

Income tax expense       3,890           3,194           2,779           3,363           3,186

Income from              7,600           6,427           5,353           6,482           6,125
continuing operations

Loss from
discontinued             (55        )    (55        )    (41        )    (44        )    (95        )
operations
(after-tax)

Net income               7,545           6,372           5,312           6,438           6,030

Preferred stock          -               -               -               4,453           930
dividends

Net income available
to common              $ 7,545         $ 6,372         $ 5,312         $ 1,985         $ 5,100
shareholders

Diluted EPS from       $ .21           $ .18           $ .15           $ .06           $ .17
continuing operations

Diluted EPS            $ .21           $ .18           $ .15           $ .06           $ .16

Diluted shares           36,783,719      36,311,306      36,303,975      33,866,237      31,072,444

CONSOLIDATED BALANCE
SHEET DATA

Total assets           $ 5,499,599     $ 5,698,318     $ 5,320,401     $ 5,306,407     $ 5,012,513

Loans held for           4,443,456       4,457,293       4,290,453       4,211,304       4,019,247
investment

Loans held for sale      592,436         693,504         549,787         544,652         426,982

Securities               246,209         266,128         285,869         308,187         361,898

Demand deposits          994,096         899,492         802,692         730,034         608,939

Total deposits           4,409,819       4,120,725       3,916,568       3,643,582       3,010,960

Other borrowings         452,061         957,029         790,192         1,059,572       1,386,783

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

Stockholders' equity     499,996         481,360         474,044         464,026         471,990

End of period shares     36,524,313      35,919,524      35,802,068      35,688,243      31,014,158
outstanding

Book value (excluding
securities             $ 13.52         $ 13.23         $ 13.05         $ 12.87         $ 12.64
gains/losses)

Tangible book value
(excluding securities  $ 13.25         $ 12.96         $ 12.84         $ 12.66         $ 12.39
gains/losses)

SELECTED FINANCIAL
RATIOS

From continuing
operations:

Net interest margin      4.43       %    4.21       %    4.06       %    3.88       %    3.39       %

Return on average        .57        %    .47        %    .40        %    .49        %    .48        %
assets

Return on average        6.21       %    5.26       %    4.46       %    5.45       %    5.44       %
equity

Non-interest income      .55        %    .59        %    .56        %    .59        %    .56        %
to earning assets

Efficiency ratio         59.8       %    68.0       %    63.1       %    62.9       %    63.0       %

Efficiency ratio
(excluding ORE           56.7       %    59.1       %    59.4       %    62.9       %    63.0       %
valuation/write-down)

Non-interest expense     2.97       %    3.26       %    2.91       %    2.80       %    2.48       %
to earning assets

From consolidated:

Net interest margin      4.43       %    4.21       %    4.06       %    3.88       %    3.39       %

Return on average        .57        %    .46        %    .40        %    .48        %    .47        %
assets

Return on average        6.17       %    5.21       %    4.43       %    5.41       %    5.36       %
equity

Tangible common
equity to total          8.8        %    8.2        %    8.7        %    8.6        %    7.8        %
tangible assets

Tier 1 capital ratio     11.3       %    10.7       %    11.2       %    11.2       %    11.9       %

Total capital ratio      12.5       %    12.0       %    12.5       %    12.3       %    13.0       %

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




TEXAS CAPITAL BANCSHARES, INC.

CONSOLIDATED BALANCE SHEETS (UNAUDITED)

(Dollars in thousands)

                                                March 31,    March 31,    %

                                                2010         2009         Change

Assets

Cash and due from banks                         $ 70,066     $ 60,631     16%

Federal funds sold                              9,990        10,000       N/M

Securities, available-for-sale                  246,209      361,898      (32)%

Loans held for sale                             592,436      426,982      39%

Loans held for sale from discontinued           583          591          (1)%
operations

Loans held for investment (net of unearned      4,443,456    4,019,247    11%
income)

Less: Allowance for loan losses                 71,705       50,145       43%

Loans held for investment, net                  4,371,751    3,969,102    10%

Premises and equipment, net                     10,773       8,457        27%

Accrued interest receivable and other assets    188,649      167,795      11%

Goodwill and intangibles, net                   9,725        7,648        27%

Total assets                                    $ 5,500,182  $ 5,013,104  10%

Liabilities and Stockholders' Equity

Liabilities:

Deposits:

Non-interest bearing                            $ 994,096    $ 608,939    63%

Interest bearing                                3,072,001    1,984,946    55%

Interest bearing in foreign branches            343,722      417,075      (18)%

Total deposits                                  4,409,819    3,010,960    46%

Accrued interest payable                        2,038        5,181        (61)%

Other liabilities                               22,862       24,784       (8)%

Federal funds purchased                         425,939      514,270      (17)%

Repurchase agreements                           21,874       62,892       (65)%

Other borrowings                                4,248        809,621      (99)%

Trust preferred subordinated debentures         113,406      113,406      -

Total liabilities                               5,000,186    4,541,114    10%

Stockholders' equity:

Preferred stock, $.01 par value, $1,000
liquidation value:

Authorized shares - 10,000,000

Issued shares                                   -            70,984

Common stock, $.01 par value:

Authorized shares - 100,000,000

Issued shares - 36,524,730 and 31,014,575 at    365          310          18%
March 31, 2010 and 2009, respectively

Additional paid-in capital                      337,124      260,647      29%

Retained earnings                               156,165      134,951      16%

Treasury stock (shares at cost: 417 at March    (8)          (8)          -
31, 2010 and 2009)

Accumulated other comprehensive income, net of  6,350        5,106        24%
taxes

Total stockholders' equity                      499,996      471,990      6%

Total liabilities and stockholders' equity      $ 5,500,182  $ 5,013,104  10%




TEXAS CAPITAL BANCSHARES, INC.

CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

(Dollars in thousands except per share data)

                                                       Three Months Ended

                                                       March 31

                                                         2010        2009

Interest income

Interest and fees on loans                             $ 61,569    $ 51,912

Securities                                               2,726       3,851

Federal funds sold                                       9           15

Deposits in other banks                                  2           28

Total interest income                                    64,306      55,806

Interest expense

Deposits                                                 7,758       11,579

Federal funds purchased                                  365         618

Repurchase agreements                                    4           14

Other borrowings                                         47          1,178

Trust preferred subordinated debentures                  904         1,200

Total interest expense                                   9,078       14,589

Net interest income                                      55,228      41,217

Provision for credit losses                              13,500      8,500

Net interest income after provision for credit losses    41,728      32,717

Non-interest income

Service charges on deposit accounts                      1,483       1,525

Trust fee income                                         954         884

Bank owned life insurance (BOLI) income                  471         274

Brokered loan fees                                       1,904       2,032

Equipment rental income                                  1,344       1,456

Other                                                    792         729

Total non-interest income                                6,948       6,900

Non-interest expense

Salaries and employee benefits                           20,069      16,219

Net occupancy expense                                    3,014       2,754

Leased equipment depreciation                            1,059       1,123

Marketing                                                787         555

Legal and professional                                   1,950       2,251

Communications and data processing                       1,016       836

FDIC insurance assessment                                1,868       1,547

Allowance and other carrying costs for OREO              2,292       1,200

Other                                                    5,131       3,821

Total non-interest expense                               37,186      30,306

Income from continuing operations before income taxes    11,490      9,311

Income tax expense                                       3,890       3,186

Income from continuing operations                        7,600       6,125

Loss from discontinued operations (after-tax)            (55    )    (95    )

Net income                                             $ 7,545     $ 6,030

Basic earnings per common share:

Income from continuing operations                      $ .21       $ .17

Net income                                             $ .21       $ .16

Diluted earnings per common share:

Income from continuing operations                      $ .21       $ .17

Net income                                             $ .21       $ .16




TEXAS CAPITAL BANCSHARES, INC.

SUMMARY OF LOAN LOSS EXPERIENCE

(Dollars in thousands)

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

                   2010         2009         2009         2009         2009

Reserve for
loan losses:

Beginning        $ 67,931     $ 65,818     $ 54,286     $ 50,145     $ 45,365
balance

Loans
charged-off:

Commercial         7,551        2,098        115          92           1,695

Real estate -      420          4,051        576          1,821        60
construction

Real estate -      766          1,971        1,239        1,250        236
term

Consumer           -            3            80           -            419

Leases             594          -            72           3,724        226

Total              9,331        8,123        2,082        6,887        2,636

Recoveries:

Commercial         18           34           21           48           21

Real estate -      -            6            -            -            7
construction

Real estate -      8            53           -            -            -
term

Consumer           -            7            16           5            -

Leases             25           34           20           -            -

Total              51           134          57           53           28
recoveries

Net charge-offs    9,280        7,989        2,025        6,834        2,608

Provision for      13,054       10,102       13,557       10,975       7,388
loan losses

Ending balance   $ 71,705     $ 67,931     $ 65,818     $ 54,286     $ 50,145

Reserve for
off-balance
sheet credit
losses:

Beginning        $ 2,948      $ 2,550      $ 2,607      $ 2,582      $ 1,470
balance

Provision for
off-balance        446          398          (57     )    25           1,112
sheet credit
losses

Ending balance   $ 3,394      $ 2,948      $ 2,550      $ 2,607      $ 2,582

Total reserves
for credit       $ 75,099     $ 70,879     $ 68,368     $ 56,893     $ 52,727
losses

Total provision
for credit       $ 13,500     $ 10,500     $ 13,500     $ 11,000     $ 8,500
losses

Reserve to
loans held for     1.61    %    1.52    %    1.53    %    1.29   %     1.25   %
investment(2)

Reserve to
average loans      1.63    %    1.55    %    1.54    %    1.32   %     1.25   %
held for
investment(2)

Net charge-offs
to average         .85     %    .72     %    .19     %    .66    %     .26    %
loans(1)(2)

Net charge-offs
to average
loans for last     .61     %    .46     %    .41     %    .41    %     .34    %
twelve months
(1)(2)

Total provision
for credit
losses to          1.24    %    .95     %    1.26    %    1.07   %     .86    %
average loans
(1)(2)

Combined
reserves for
credit losses      1.69    %    1.59    %    1.59    %    1.35   %     1.31   %
to loans held
for investment
(2)

Non-performing
assets (NPAs):
(4)

Non-accrual      $ 115,926    $ 95,625     $ 85,270     $ 49,592     $ 50,683
loans

Other real
estate owned       28,865       27,264       34,671       31,404       27,501
(OREO)(5)

Total            $ 144,791    $ 122,889    $ 119,941    $ 80,996     $ 78,184

Non-accrual
loans to loans     2.61    %    2.15    %    1.99    %    1.18   %     1.26   %
(2)

Total NPAs to
loans plus OREO    3.24    %    2.74    %    2.77    %    1.91   %     1.93   %
(2)

Reserve for
loan losses to   .6x          .7x          .8x          1.1x         1.0x
non-accrual
loans

Restructured     $ 10,700     $ -          $ -          $ -          $ -
loans

Loans past due
90 days and      $ 2,390      $ 6,081      $ 7,569      $ 3,539      $ 4,637
still accruing
(3)

Loans past due
90 days to         .05     %    .14     %    .18     %    .08    %     .12    %
loans(2)



(1) Interim period ratios are annualized.

(2) Excludes loans held for sale.

(3) At March 31, 2010, loans past due 90 days and still accruing includes premium finance loans of $2.0 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 March 31, 2010, non-performing assets include $2.6 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 OREO.

(5) At March 31, 2010, OREO balance is net of $8.5 million valuation allowance.


TEXAS CAPITAL BANCSHARES, INC.

CONSOLIDATED STATEMENT OF INCOME (UNAUDITED)

(Dollars in thousands)

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

                   2010         2009         2009         2009         2009

Interest income

Interest and     $ 61,569     $ 62,174     $ 58,959     $ 56,455     $ 51,912
fees on loans

Securities         2,726        2,957        3,226        3,544        3,851

Federal funds      9            2            5            9            15
sold

Deposits in        2            4            7            5            28
other banks

Total interest     64,306       65,137       62,197       60,013       55,806
income

Interest
expense

Deposits           7,758        8,560        8,916        8,769        11,579

Federal funds      365          460          586          740          618
purchased

Repurchase         4            11           14           14           14
agreements

Other              47           76           125          570          1,178
borrowings

Trust preferred
subordinated       904          924          990          1,118        1,200
debentures

Total interest     9,078        10,031       10,631       11,211       14,589
expense

Net interest       55,228       55,106       51,566       48,802       41,217
income

Provision for      13,500       10,500       13,500       11,000       8,500
credit losses

Net interest
income after       41,728       44,606       38,066       37,802       32,717
provision for
credit losses

Non-interest
income

Service charges
on deposit         1,483        1,490        1,658        1,614        1,525
accounts

Trust fee          954          979          1,000        952          884
income

Bank owned life
insurance          471          464          418          423          274
(BOLI) income

Brokered loan      1,904        2,221        2,120        2,670        2,032
fees

Equipment          1,344        1,357        1,291        1,453        1,456
rental income

Other              792          1,300        646          304          729

Total
non-interest       6,948        7,811        7,133        7,416        6,900
income

Non-interest
expense

Salaries and
employee           20,069       19,631       19,569       18,000       16,219
benefits

Net occupancy      3,014        2,986        3,164        3,387        2,754
expense

Leased
equipment          1,059        1,031        1,050        1,115        1,123
depreciation

Marketing          787          1,119        705          655          555

Legal and          1,950        3,030        3,274        3,291        2,251
professional

Communications
and data           1,016        993          935          979          836
processing

FDIC insurance     1,868        1,972        1,452        3,493        1,547
assessment

Allowance and
other carrying     2,292        6,377        2,390        378          1,200
costs for OREO

Other              5,131        5,657        4,528        4,075        3,821

Total
non-interest       37,186       42,796       37,067       35,373       30,306
expense

Income from
continuing
operations         11,490       9,621        8,132        9,845        9,311
before income
taxes

Income tax         3,890        3,194        2,779        3,363        3,186
expense

Income from
continuing         7,600        6,427        5,353        6,482        6,125
operations

Loss from
discontinued       (55    )     (55    )     (41    )     (44    )     (95    )
operations
(after-tax)

Net income         7,545        6,372        5,312        6,438        6,030

Preferred stock    -            -            -            4,453        930
dividends

Net income
available to     $ 7,545      $ 6,372      $ 5,312      $ 1,985      $ 5,100
common
stockholders




TEXAS CAPITAL BANCSHARES, INC.

QUARTERLY FINANCIAL SUMMARY - UNAUDITED

Consolidated Daily Average Balances, Average Yields and Rates

Continuing Operations

(Dollars in thousands)

               1st Quarter 2010               4th Quarter 2009               3rd Quarter 2009                2nd Quarter 2009               1st Quarter 2009

               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 -   $ 211,618    $ 2,341   4.49 %  $ 230,686    $ 2,560   4.40 %  $ 247,936    $ 2,813   4.50 %   $ 280,372    $ 3,124   4.47 %  $ 321,802    $ 3,431   4.32 %
Taxable

Securities -
Non-taxable      41,654       592     5.76 %    42,932       611     5.65 %    44,642       635     5.64 %     45,901       646     5.64 %    46,055       646     5.69 %
(2)

Federal funds    7,471        9       0.49 %    5,550        2       0.14 %    6,782        5       0.29 %     5,649        9       0.64 %    14,923       15      0.41 %
sold

Deposits in      12,457       2       0.07 %    12,916       4       0.12 %    12,649       7       0.22 %     12,268       5       0.16 %    11,207       28      1.01 %
other banks

Loans held       457,459      5,490   4.87 %    601,793      7,286   4.80 %    539,889      6,836   5.02 %     656,462      7,727   4.72 %    587,401      6,487   4.48 %
for sale

Loans held
for              4,413,960    56,079  5.15 %    4,384,692    54,888  4.97 %    4,264,202    52,123  4.85 %     4,124,937    48,728  4.74 %    4,022,180    45,425  4.58 %
investment

Less reserve
for loan         66,726       -       -         68,177       -       -         56,429       -       -          51,601       -       -         46,686       -       -
losses

Loans, net of    4,804,693    61,569  5.20 %    4,918,308    62,174  5.02 %    4,747,662    58,959  4.92 %     4,729,798    56,455  4.78 %    4,562,895    51,912  4.61 %
reserve

Total earning    5,077,893    64,513  5.15 %    5,210,392    65,351  4.98 %    5,059,671    62,419  4.89 %     5,073,988    60,239  4.76 %    4,956,882    56,032  4.58 %
assets

Cash and         311,128                        243,823                        245,564                         251,960                        238,723
other assets

Total assets   $ 5,389,021                    $ 5,454,215                    $ 5,305,235                     $ 5,325,948                    $ 5,195,605

Liabilities
and
Stockholders'
Equity

Transaction    $ 365,205    $ 264     0.29 %  $ 180,767    $ 85      0.19 %  $ 144,944    $ 58      0.16 %   $ 135,756    $ 55      0.16 %  $ 129,850    $ 44      0.14 %
deposits

Savings          1,773,201    3,524   0.81 %    1,620,659    3,569   0.87 %    1,377,712    3,090   0.89 %     974,275      2,003   0.82 %    745,355      1,420   0.77 %
deposits

Time deposits    840,820      2,787   1.34 %    1,111,899    3,454   1.23 %    1,284,220    4,245   1.31 %     1,082,691    5,105   1.89 %    1,277,824    8,066   2.56 %

Deposits in
foreign          353,803      1,183   1.36 %    401,661      1,452   1.43 %    404,545      1,523   1.49 %     394,251      1,606   1.63 %    444,549      2,049   1.87 %
branches

Total
interest         3,333,029    7,758   0.94 %    3,314,986    8,560   1.02 %    3,211,421    8,916   1.10 %     2,586,973    8,769   1.36 %    2,597,578    11,579  1.81 %
bearing
deposits

Other            461,477      416     0.37 %    607,731      547     0.36 %    724,127      725     0.40 %     1,404,881    1,324   0.38 %    1,367,691    1,810   0.54 %
borrowings

Trust
preferred        113,406      904     3.23 %    113,406      924     3.23 %    113,406      990     3.46 %     113,406      1,118   3.95 %    113,406      1,200   4.29 %
subordinated
debentures

Total
interest         3,907,912    9,078   0.94 %    4,036,123    10,031  0.99 %    4,048,954    10,631  1.04 %     4,105,260    11,211  1.10 %    4,078,675    14,589  1.45 %
bearing
liabilities

Demand           956,359                        914,266                        764,557                         724,487                        636,704
deposits

Other            28,643                         18,787                         15,617                          18,899                         23,619
liabilities

Stockholders'    496,107                        485,039                        476,107                         477,302                        456,607
equity

Total
liabilities
and            $ 5,389,021                    $ 5,454,215                    $ 5,305,235                     $ 5,325,948                    $ 5,195,605
stockholders'
equity

Net interest                $ 55,435                       $ 55,320                       $ 51,788                        $ 49,028                       $ 41,443
income

Net interest                          4.43 %                         4.21 %                         4.06 %                          3.88 %                         3.39 %
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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