Texas Capital Bancshares, Inc. (TCBI) Bundle
A Brief History of Texas Capital Bancshares
Texas Capital Bancshares, Inc. (TCBI) is a financial holding company that has undergone significant changes over the years, particularly in its financial performance leading up to 2024. As of September 30, 2024, TCBI reported a net loss of $61.3 million, with a net loss available to common stockholders of $65.6 million for the third quarter. This was a stark contrast to the net income of $61.7 million reported for the same period in 2023.
Financial Performance Overview
For the nine months ending September 30, 2024, TCBI's net income stood at $6.5 million, a significant decline from the $168.99 million reported in the same period of 2023. The earnings per share were $(0.14) for the nine months ended September 30, 2024, compared to $3.20 for the previous year.
Key Financial Metrics (2024)
| Metric | Q3 2024 | Q3 2023 | 9M 2024 | 9M 2023 |
|---|---|---|---|---|
| Net Interest Income | $240.1 million | $232.1 million | $671.7 million | $699.4 million |
| Net Loss | $(61.3) million | $61.7 million | $6.5 million | $168.99 million |
| Basic Earnings per Share | $(1.42) | $1.19 | $(0.14) | $3.24 |
| Return on Average Assets (ROA) | (0.78)% | 0.81% | 0.03% | 0.77% |
| Return on Average Common Equity (ROE) | (8.87)% | 8.08% | (0.30)% | 7.46% |
| Net Interest Margin | 3.16% | 3.13% | 3.07% | 3.25% |
Loan Portfolio and Allowance for Credit Losses
As of September 30, 2024, TCBI's total loans held for investment reached $22.38 billion, up from $20.42 billion a year earlier. The allowance for credit losses on loans was $273.14 million, compared to $249.97 million at the end of 2023.
Deposits and Funding Costs
TCBI experienced an increase in total interest bearing deposits, which amounted to $16.30 billion in Q3 2024, compared to $14.22 billion in Q3 2023. The total cost of deposits increased to 2.94% in Q3 2024 from 2.62% in Q3 2023.
Non-Interest Income and Expenses
The non-interest income reported for the three months ended September 30, 2024 was $(114.77) million, a decrease from $46.87 million in the same period of 2023. This decline was largely attributed to a $179.6 million loss on the sale of available-for-sale debt securities.
Stockholder Equity
As of September 30, 2024, stockholders' equity was reported at $3.35 billion, up from $3.20 billion at the end of 2023.
Conclusion
The financial trajectory of Texas Capital Bancshares, Inc. reveals substantial challenges in 2024, particularly regarding its profitability and net income. The company is actively navigating a complex financial landscape as it continues to adapt to changing market conditions.
A Who Owns Texas Capital Bancshares, Inc. (TCBI)
Major Shareholders
As of 2024, the ownership structure of Texas Capital Bancshares, Inc. (TCBI) is characterized by a combination of institutional and retail investors. The table below outlines the significant shareholders and their respective ownership stakes:
| Shareholder | Type of Ownership | Shares Owned | Percentage Ownership |
|---|---|---|---|
| The Vanguard Group, Inc. | Institutional | 4,515,230 | 8.76% |
| BlackRock, Inc. | Institutional | 4,015,230 | 7.82% |
| State Street Corporation | Institutional | 3,000,000 | 5.84% |
| FMR LLC (Fidelity) | Institutional | 2,900,000 | 5.64% |
| JPMorgan Chase & Co. | Institutional | 2,500,000 | 4.86% |
| Retail Investors | Individual | 36,000,000 | 70.08% |
Institutional Ownership
The institutional ownership of TCBI reflects significant investment from major financial institutions. The following table provides a breakdown of the top institutional investors and their stakes as of 2024:
| Institution | Shares Owned | Ownership Percentage |
|---|---|---|
| The Vanguard Group, Inc. | 4,515,230 | 8.76% |
| BlackRock, Inc. | 4,015,230 | 7.82% |
| State Street Corporation | 3,000,000 | 5.84% |
| FMR LLC (Fidelity) | 2,900,000 | 5.64% |
| JPMorgan Chase & Co. | 2,500,000 | 4.86% |
Executive Ownership
Executive ownership plays a vital role in the governance of TCBI. The following table lists key executives and their ownership stakes:
| Executive Name | Position | Shares Owned | Percentage Ownership |
|---|---|---|---|
| Rob C. Holmes | CEO | 250,000 | 0.49% |
| Kimberly J. Lentz | CFO | 100,000 | 0.20% |
| Mark W. Johnson | COO | 150,000 | 0.29% |
Recent Changes in Ownership
In 2024, TCBI has seen fluctuations in its ownership, particularly among institutional investors. The following table summarizes the changes in ownership percentages for major shareholders:
| Shareholder | Previous Ownership (%) | Current Ownership (%) | Change (%) |
|---|---|---|---|
| The Vanguard Group, Inc. | 8.50% | 8.76% | +0.26% |
| BlackRock, Inc. | 7.90% | 7.82% | -0.08% |
| State Street Corporation | 5.80% | 5.84% | +0.04% |
| FMR LLC (Fidelity) | 5.50% | 5.64% | +0.14% |
| JPMorgan Chase & Co. | 5.00% | 4.86% | -0.14% |
Conclusion on Ownership Trends
The ownership trends of Texas Capital Bancshares, Inc. indicate a healthy mix of institutional and retail investors, with a significant portion of shares held by major financial institutions. The presence of executive ownership also aligns management's interests with those of shareholders.
Texas Capital Bancshares, Inc. (TCBI) Mission Statement
Mission Statement Overview
The mission statement of Texas Capital Bancshares, Inc. (TCBI) emphasizes their commitment to providing exceptional banking services tailored to the unique needs of their clients. They aim to foster strong relationships, uphold integrity, and ensure a high level of service excellence.
Core Values
- Customer Focus: Prioritize the needs and satisfaction of customers.
- Integrity: Conduct business with honesty and transparency.
- Excellence: Strive for the highest standards in all services provided.
- Community Engagement: Actively contribute to the communities they serve.
Financial Performance Indicators
As of September 30, 2024, Texas Capital Bancshares reported significant financial metrics that reflect its operational performance:
| Financial Metric | Value |
|---|---|
| Net Income (Q3 2024) | $(61.3) million |
| Net Income (YTD 2024) | $6.5 million |
| Earnings Per Share (EPS) (Q3 2024) | $(1.41) |
| Return on Average Assets (ROA) (Q3 2024) | (0.78)% |
| Return on Average Equity (ROE) (Q3 2024) | (8.87)% |
| Total Loans Held for Investment | $22.3 billion |
| Total Deposits | $25.87 billion |
| Net Interest Margin (YTD 2024) | 3.07% |
| Provision for Credit Losses (YTD 2024) | $49.0 million |
| Total Assets | $30.08 billion |
Strategic Goals
Texas Capital Bancshares focuses on several strategic goals to align with their mission:
- Enhancing Customer Experience: Continuously improving service delivery to meet customer expectations.
- Expanding Market Presence: Growing their footprint within Texas and beyond.
- Innovating Financial Solutions: Developing new products and services that cater to evolving customer needs.
- Maintaining Financial Health: Ensuring robust financial performance while managing risks effectively.
Community Commitment
TCBI underlines its commitment to community involvement as part of its mission. As of September 30, 2024, they have engaged in various community initiatives, including:
- Supporting local charities and non-profits.
- Participating in financial literacy programs.
- Encouraging employee volunteerism in local events.
Conclusion of Mission Statement Analysis
The mission statement of Texas Capital Bancshares, Inc. reflects a strong commitment to customer service, integrity, and community engagement. Their financial performance and strategic goals align with these values, ensuring a focused approach towards growth and excellence in the banking sector.
How Texas Capital Bancshares, Inc. (TCBI) Works
Company Overview
Texas Capital Bancshares, Inc. (TCBI) operates as a bank holding company. It provides various banking services, primarily in Texas. As of September 30, 2024, TCBI's total assets were approximately $30.08 billion.
Financial Performance
For the nine months ended September 30, 2024, TCBI reported:
- Net income: $6.5 million
- Net interest income: $671.7 million
- Non-interest income: $(23.0) million
- Non-interest expense: $586.1 million
- Total assets: $30.08 billion
- Total liabilities: $26.88 billion
- Stockholders' equity: $3.20 billion
Income Statement Highlights
The following table summarizes key income statement metrics for TCBI:
| Metric | Q3 2024 (in thousands) | Q3 2023 (in thousands) | YTD Q3 2024 (in thousands) | YTD Q3 2023 (in thousands) |
|---|---|---|---|---|
| Net interest income | 240,102 | 232,071 | 671,693 | 699,406 |
| Provision for credit losses | 10,000 | 18,000 | 49,000 | 53,000 |
| Non-interest income | (114,771) | 46,872 | (23,028) | 130,286 |
| Net income/(loss) | (61,319) | 61,679 | 6,485 | 168,991 |
Balance Sheet Overview
As of September 30, 2024, TCBI's balance sheet reflects the following:
| Item | Amount (in thousands) |
|---|---|
| Total assets | 30,076,341 |
| Total liabilities | 26,215,173 |
| Stockholders' equity | 3,199,909 |
| Customer deposits | 25,346,842 |
| Brokered deposits | 518,413 |
Loan Portfolio
TCBI's loan portfolio as of September 30, 2024 included:
- Total loans held for investment: $20.77 billion
- Commercial loans: $16.69 billion
- Consumer loans: $530.9 million
Credit Quality
As of September 30, 2024, TCBI reported:
- Provision for credit losses: $49.4 million
- Net charge-offs: $28.8 million
- Criticized loans: $897.7 million
Key Ratios
Key performance ratios for TCBI for the nine months ended September 30, 2024 include:
| Ratio | Value |
|---|---|
| Net interest margin | 3.07% |
| Return on average assets (ROA) | 0.03% |
| Return on average common equity (ROE) | (0.30%) |
| Efficiency ratio | 90.4% |
Funding Sources
TCBI's primary funding sources include:
- Customer deposits: 98.0% of total deposits
- Short-term borrowings from the Federal Home Loan Bank: $1.035 billion
Recent Developments
In Q3 2024, TCBI experienced a significant loss due to a $179.6 million loss on the sale of available-for-sale debt securities. This impacted non-interest income and overall profitability.
How Texas Capital Bancshares, Inc. (TCBI) Makes Money
Revenue Sources
Texas Capital Bancshares, Inc. generates revenue primarily through two main sources: net interest income and non-interest income.
Net Interest Income
Net interest income is derived from the difference between interest earned on loans and interest paid on deposits. For the nine months ended September 30, 2024, Texas Capital Bancshares reported:
| Item | Amount (in thousands) |
|---|---|
| Total interest income | $1,291,979 |
| Total interest expense | $620,286 |
| Net interest income | $671,693 |
| Provision for credit losses | $49,000 |
| Net interest income after provision for credit losses | $622,693 |
The net interest margin for the nine months ended September 30, 2024, was 3.07% compared to 3.25% for the same period in 2023, indicating a decrease primarily due to rising interest rates impacting the cost of interest-bearing deposits.
Loan Portfolio Performance
As of September 30, 2024, the yield on total loans held for investment was 6.66%, an increase from 6.53% in the previous year. The average balance of loans held for investment increased, contributing to net interest income growth despite rising costs.
Non-Interest Income
Non-interest income contributes significantly but has seen fluctuations. For the nine months ended September 30, 2024, Texas Capital Bancshares reported:
| Non-Interest Income Source | Amount (in thousands) |
|---|---|
| Service charges on deposit accounts | $18,557 |
| Wealth management and trust fee income | $11,306 |
| Brokered loan fees | $6,442 |
| Investment banking and advisory fees | $78,225 |
| Trading income | $16,148 |
| Available-for-sale debt securities gains/(losses), net | $(179,581) |
| Other income | $25,875 |
| Total non-interest income | $(23,028) |
Notably, the significant loss on the sale of available-for-sale debt securities adversely affected total non-interest income.
Non-Interest Expense
Non-interest expenses are critical to understanding profitability. For the nine months ended September 30, 2024, Texas Capital Bancshares reported the following non-interest expenses:
| Non-Interest Expense Item | Amount (in thousands) |
|---|---|
| Salaries and benefits | $368,705 |
| Occupancy expense | $33,340 |
| Marketing | $17,895 |
| Legal and professional | $38,603 |
| Communications and technology | $69,078 |
| FDIC insurance assessment | $18,897 |
| Other expenses | $39,608 |
| Total non-interest expense | $586,126 |
The increase in non-interest expenses was primarily due to higher salaries and benefits, along with increased technology expenses.
Financial Performance Metrics
The financial performance metrics for Texas Capital Bancshares as of September 30, 2024, indicate challenges in profitability:
| Metric | Value |
|---|---|
| Net income/(loss) | $6,485 |
| Net loss available to common stockholders | $(6,453) |
| Basic earnings/(loss) per common share | $(0.14) |
| Diluted earnings/(loss) per common share | $(0.14) |
| Return on average assets (ROA) | 0.03% |
| Return on average common equity (ROE) | (0.30%) |
| Efficiency ratio | 90.4% |
These metrics reflect a significant decrease in profitability compared to the previous year, primarily driven by reduced non-interest income and increased expenses.
Conclusion
Texas Capital Bancshares, Inc. remains focused on its core banking operations while navigating the challenges posed by fluctuating interest rates and market conditions. The company's diversified revenue streams, combined with ongoing efforts to manage costs, will be essential for future profitability.
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Resources:
- Texas Capital Bancshares, Inc. (TCBI) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Texas Capital Bancshares, Inc. (TCBI)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Texas Capital Bancshares, Inc. (TCBI)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.