Texas Capital Bancshares Caps Year by Raising $18.5 Million
FOR IMMEDIATE RELEASE
April 15, 2002
Company reports first profitable year and assets exceeding $1 billion
Dallas - After recording its first full year of profitability and seeing its
chairman named 2001 Community Banker of the Year by American Banker
, Texas Capital Bancshares announces the successful completion of the issuance
of convertible preferred stock that raised $18.5 million in additional capital.
The private offering brings the total capital raised to $125 million since
Texas Capital commenced operations in January 1999.
"Our initial capitalization of $80 million was the largest in U.S. banking
history, and we raised another $26.5 million in our second offering in 2001,"
said Jody Grant, chairman & CEO of Texas Capital Bancshares. "We were very
gratified by the confidence shown by our current and new shareholders in the
future of the bank."
The latest offering brings the total number of registered shareholders in Texas
Capital Bancshares to 906, many of whom are well-known business and civic
leaders throughout Texas. Its shareholder base is the centerpiece of the bank's
unique Texas Capital Connections program. Through strategic meetings and
informal get-togethers, the bank makes a conscious effort to meet its
customers' needs by connecting them with shareholders, even when those needs
are outside the province of traditional banking services.
"If our customers are looking for investors, joint venture partners or a board
member with specific expertise, the chances are we can match them with the
interests of one of our shareholders," said Raleigh Hortenstine, president of
Texas Capital Bancshares. "It's something no other Texas bank can offer."
For the year ended December 31, 2001, Texas Capital reported net income of $5.8
million compared to a loss of $16.5 million the previous year. Diluted earnings
per common share were $.61 for 2001 compared to a loss of $1.89 in 2000.
Profits were recorded each quarter during 2001 despite the slowing economy, the
dramatic decline in interest rates and the uncertainty created by the tragic
events of September 11.
"Our strong, middle-market customer base was not seriously affected by the
national economic slowdown," said Grant. "In addition, we have local bankers
making smart decisions about the businesses in their respective communities —
both helped fuel our quality earnings growth."
Total assets grew during the year to $1.165 billion, believed to be the first
time a commercial bank has exceeded $1 billion in assets in just over two years
by growing organically — without acquisitions. Assets were $908 million at the
end of 2000.
Other 2001 Financial Results
Loans as of December 31, 2001 were $904 million compared to $629 million the
previous year, representing an increase of 44 percent. Of the $275 million in
loan growth, $187 million (68 percent) occurred in the first half of the year,
while the remaining $88 million (32 percent) occurred after the company
transitioned to a more managed growth phase during the recession.
During 2001, total deposits increased $92 million from $794 million on December
31, 2000 to $886 million on December 31, 2001. This increase was achieved even
though higher cost deposits acquired in 2000 by Texas Capital's Internet
division, BankDirect, were reduced by $121 million from $371 million to $250
million at year-end. Offsetting this decline, Texas Capital Bank traditional
and institutional deposits grew 50 percent from $423 million to $636 million,
and now account for 72 percent of total deposits. Non-interest bearing deposits
increased 89 percent during the year from $72 million to $136 million. Deposits
from BankDirect's affinity relationship with the American Airlines AAdvantage®
program approached $40 million at year-end.
For the year ended December 31, 2001, net interest income was $35.1 million, up
54 percent from $22.8 million for 2000. Non-interest income, including
securities gains, was $6.0 million for 2001, compared to $2 million for last
year. Non-interest expense was $29.4 million in 2001, a decrease of 16 percent
from $35.2 million in 2000.
Net charge-offs for the 12 months ended December 31, 2001 were $2.1 million or
.26 percent of average loans and leases; there were no charge-offs for the
previous year. The loss performance in 2001 compares very favorably to a
selected peer group of publicly traded Texas banks that experienced net
charge-offs to average loans of .42 percent over the same period. During the
year, $5.8 million was added to the loan loss reserve, bringing it to $12.6
million. As of December 31, 2001, the reserve was 1.39 percent of total loans
compared to 1.33 percent for the Texas peer group.
About Texas Capital Bancshares
Texas Capital Bank is privately owned and operated by the holding company Texas
Capital Bancshares, Inc. Launched in January 1999 with initial capitalization
of $80 million, and believed to be the largest start-up bank in U.S. history,
Texas Capital Bancshares was founded by experienced, entrepreneurial bankers
determined to help other successful individuals and businesses achieve their
financial goals. The Texas Capital philosophy has been well received as
evidenced by the bank's growth in total assets to over $1.1 billion. Texas
Capital targets businesses with borrowing needs up to $10 million, the
executives of those businesses and affluent individuals. The bank has
full-service locations in Austin, Dallas, Fort Worth, Plano and San Antonio.
Visit TexasCapitalBank.com.
This release contains forward-looking statements, which are
subject to risks and uncertainties. A number of factors, many of which are
beyond the Company's control, could cause actual conditions, events or results
to differ significantly from those described in the Company's 10-K for the
period ended December 31, 2001 which was recently filed with the Securities and
Exchange Commission. To obtain the Form 10-K, call Investor Relations at
214.932.6631.