Le Lézard
Classified in: Business
Subjects: EARNINGS, Conference Call, Webcast

Hilltop Holdings Inc. Announces Financial Results for First Quarter 2024


Hilltop Holdings Inc. (NYSE: HTH) ("Hilltop") today announced financial results for the first quarter of 2024. Hilltop produced income to common stockholders of $27.7 million, or $0.42 per diluted share, for the first quarter of 2024, compared to $25.8 million, or $0.40 per diluted share, for the first quarter of 2023. Hilltop's financial results for the first quarter of 2024 included a decline in net interest income, partially offset by a reversal of credit losses due to an improved economic outlook within the banking segment, an increase in net revenues within certain of the broker-dealer segment's business lines, and a decline in other mortgage production income, partially offset by an increase in net gains from sale of loans within the mortgage origination segment.

Hilltop also announced that its Board of Directors declared a quarterly cash dividend of $0.17 per common share payable on May 24, 2024, to all common stockholders of record as of the close of business on May 10, 2024. Additionally, during the first quarter of 2024, Hilltop paid $9.9 million to repurchase an aggregate of 320,042 shares of its common stock at an average price of $31.04 per share pursuant to the 2024 stock repurchase program. These shares were returned to the pool of authorized but unissued shares of common stock.

The impacts of economic headwinds that began in 2022, and continued into 2024, remain uncertain and will depend on developments outside of our control, including, among others, the timing and significance of further changes in U.S. treasury yields and mortgage interest rates, exposure to increasing funding costs, inflationary pressures associated with compensation, occupancy and software costs and labor market conditions, and international armed conflicts and their impact on supply chains.

Jeremy B. Ford, President and CEO of Hilltop, said, "Hilltop's operating results for the first quarter of 2024 reflect a general continuation in market trends that were experienced throughout 2023. The elevated interest rate environment continues to impact our net interest margin primarily through increased borrowing costs. Additionally, a lack of housing inventory and pressured home buying affordability limited mortgage origination volumes. Despite these pressures, Hilltop's robust liquidity position allowed for a return of high-cost deposits.

"During the quarter, PlainsCapital Bank produced an annualized return on average assets of 1.20% highlighting the steady earnings power of the franchise. HilltopSecurities delivered a pre-tax margin of 16% on net revenues of $117 million, primarily due to strong results from the structured finance and wealth management business lines. As previously mentioned, PrimeLending's results remain challenged due to elevated mortgage rates and suboptimal housing inventory across the country. From a consolidated perspective, we will continue to protect our strong balance sheet position and aim to produce results that improve our tangible book value per share over time."

First Quarter 2024 Highlights for Hilltop:

_____________________________

1

 

"Loans" reflect loans held for investment excluding broker-dealer margin loans, net of allowance for credit losses, of $332.6 million and $344.1 million at March 31, 2024 and December 31, 2023, respectively.

2

 

Capital ratios reflect Hilltop's decision to elect the transition option as issued by the federal banking regulatory agencies in March 2020 that permits banking institutions to mitigate the estimated cumulative regulatory capital effects from CECL over a five-year transitionary period through December 31, 2024.

3

 

Based on the end of period Tier 1 capital divided by total average assets during the quarter, excluding goodwill and intangible assets.

4

 

Net interest margin is defined as net interest income divided by average interest-earning assets.

Consolidated Financial and Other Information

Consolidated Balance Sheets

 

March 31,

 

December 31,

 

September 30,

 

June 30,

 

March 31,

(in 000's)

 

2024

 

2023

 

2023

 

2023

 

2023

Cash and due from banks

 

$

1,710,066

 

 

$

1,858,700

 

 

$

1,513,747

 

 

$

1,584,709

 

 

$

1,764,081

 

Federal funds sold

 

 

650

 

 

 

650

 

 

 

3,650

 

 

 

650

 

 

 

743

 

Assets segregated for regulatory purposes

 

 

70,717

 

 

 

57,395

 

 

 

47,491

 

 

 

50,711

 

 

 

36,199

 

Securities purchased under agreements to resell

 

 

91,608

 

 

 

80,011

 

 

 

123,719

 

 

 

143,982

 

 

 

144,201

 

Securities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Trading, at fair value

 

 

657,700

 

 

 

515,991

 

 

 

578,901

 

 

 

696,649

 

 

 

692,908

 

Available for sale, at fair value, net (1)

 

 

1,480,555

 

 

 

1,507,595

 

 

 

1,456,238

 

 

 

1,526,869

 

 

 

1,641,571

 

Held to maturity, at amortized cost, net (1)

 

 

790,550

 

 

 

812,677

 

 

 

825,079

 

 

 

847,437

 

 

 

862,280

 

Equity, at fair value

 

 

315

 

 

 

321

 

 

 

264

 

 

 

258

 

 

 

231

 

 

 

 

2,929,120

 

 

 

2,836,584

 

 

 

2,860,482

 

 

 

3,071,213

 

 

 

3,196,990

 

Loans held for sale

 

 

842,324

 

 

 

943,846

 

 

 

1,058,806

 

 

 

1,333,044

 

 

 

1,040,138

 

Loans held for investment, net of unearned income

 

 

8,062,693

 

 

 

8,079,745

 

 

 

8,204,052

 

 

 

8,354,122

 

 

 

8,192,846

 

Allowance for credit losses

 

 

(104,231

)

 

 

(111,413

)

 

 

(110,822

)

 

 

(109,306

)

 

 

(97,354

)

Loans held for investment, net

 

 

7,958,462

 

 

 

7,968,332

 

 

 

8,093,230

 

 

 

8,244,816

 

 

 

8,095,492

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Broker-dealer and clearing organization receivables

 

 

1,473,561

 

 

 

1,573,931

 

 

 

1,460,352

 

 

 

1,474,177

 

 

 

1,560,246

 

Premises and equipment, net

 

 

165,557

 

 

 

168,856

 

 

 

172,097

 

 

 

176,574

 

 

 

180,132

 

Operating lease right-of-use assets

 

 

95,343

 

 

 

88,580

 

 

 

93,057

 

 

 

97,979

 

 

 

100,122

 

Mortgage servicing assets

 

 

95,591

 

 

 

96,662

 

 

 

104,951

 

 

 

95,101

 

 

 

103,314

 

Other assets

 

 

501,244

 

 

 

517,545

 

 

 

588,751

 

 

 

588,166

 

 

 

529,438

 

Goodwill

 

 

267,447

 

 

 

267,447

 

 

 

267,447

 

 

 

267,447

 

 

 

267,447

 

Other intangible assets, net

 

 

7,943

 

 

 

8,457

 

 

 

9,078

 

 

 

9,772

 

 

 

10,544

 

Total assets

 

$

16,209,633

 

 

$

16,466,996

 

 

$

16,396,858

 

 

$

17,138,341

 

 

$

17,029,087

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposits:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing

 

$

3,028,543

 

 

$

3,007,101

 

 

$

3,200,247

 

 

$

3,451,438

 

 

$

3,807,878

 

Interest-bearing

 

 

7,855,553

 

 

 

8,056,091

 

 

 

7,902,850

 

 

 

7,712,739

 

 

 

7,289,269

 

Total deposits

 

 

10,884,096

 

 

 

11,063,192

 

 

 

11,103,097

 

 

 

11,164,177

 

 

 

11,097,147

 

Broker-dealer and clearing organization payables

 

 

1,436,462

 

 

 

1,430,734

 

 

 

1,368,064

 

 

 

1,306,646

 

 

 

1,383,317

 

Short-term borrowings

 

 

892,574

 

 

 

900,038

 

 

 

882,999

 

 

 

1,628,637

 

 

 

1,572,794

 

Securities sold, not yet purchased, at fair value

 

 

60,562

 

 

 

34,872

 

 

 

51,527

 

 

 

74,761

 

 

 

51,497

 

Notes payable

 

 

347,273

 

 

 

347,145

 

 

 

347,020

 

 

 

364,531

 

 

 

376,410

 

Operating lease liabilities

 

 

114,518

 

 

 

109,002

 

 

 

114,334

 

 

 

119,999

 

 

 

122,878

 

Other liabilities

 

 

314,718

 

 

 

431,684

 

 

 

422,955

 

 

 

389,336

 

 

 

341,246

 

Total liabilities

 

 

14,050,203

 

 

 

14,316,667

 

 

 

14,289,996

 

 

 

15,048,087

 

 

 

14,945,289

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common stock

 

 

653

 

 

 

652

 

 

 

652

 

 

 

651

 

 

 

650

 

Additional paid-in capital

 

 

1,049,831

 

 

 

1,054,662

 

 

 

1,052,867

 

 

 

1,050,191

 

 

 

1,044,774

 

Accumulated other comprehensive loss

 

 

(119,606

)

 

 

(121,505

)

 

 

(145,083

)

 

 

(131,718

)

 

 

(125,461

)

Retained earnings

 

 

1,201,013

 

 

 

1,189,222

 

 

 

1,171,250

 

 

 

1,144,624

 

 

 

1,136,901

 

Deferred compensation employee stock trust, net

 

 

115

 

 

 

228

 

 

 

340

 

 

 

450

 

 

 

446

 

Employee stock trust

 

 

(142

)

 

 

(292

)

 

 

(446

)

 

 

(599

)

 

 

(599

)

Total Hilltop stockholders' equity

 

 

2,131,864

 

 

 

2,122,967

 

 

 

2,079,580

 

 

 

2,063,599

 

 

 

2,056,711

 

Noncontrolling interests

 

 

27,566

 

 

 

27,362

 

 

 

27,282

 

 

 

26,655

 

 

 

27,087

 

Total stockholders' equity

 

 

2,159,430

 

 

 

2,150,329

 

 

 

2,106,862

 

 

 

2,090,254

 

 

 

2,083,798

 

Total liabilities & stockholders' equity

 

$

16,209,633

 

 

$

16,466,996

 

 

$

16,396,858

 

 

$

17,138,341

 

 

$

17,029,087

 

_____________________________

(1)

 

At March 31, 2024, the amortized cost of the available for sale securities portfolio was $1,594,167, while the fair value of the held to maturity securities portfolio was $702,843.

 

 

Three Months Ended

Consolidated Income Statements

 

March 31,

 

December 31,

 

September 30,

 

June 30,

 

March 31,

(in 000's, except per share data)

 

2024

 

2023

 

2023

 

2023

 

2023

Interest income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans, including fees

 

$

134,331

 

 

$

138,096

 

$

142,402

 

 

$

138,397

 

$

123,379

Securities borrowed

 

 

20,561

 

 

 

18,659

 

 

17,683

 

 

 

18,515

 

 

17,068

Securities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Taxable

 

 

26,241

 

 

 

28,763

 

 

27,166

 

 

 

26,719

 

 

25,602

Tax-exempt

 

 

2,415

 

 

 

2,545

 

 

2,464

 

 

 

2,566

 

 

3,188

Other

 

 

26,066

 

 

 

28,704

 

 

27,040

 

 

 

27,229

 

 

22,190

Total interest income

 

 

209,614

 

 

 

216,767

 

 

216,755

 

 

 

213,426

 

 

191,427

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposits

 

 

69,144

 

 

 

68,339

 

 

64,290

 

 

 

54,726

 

 

35,824

Securities loaned

 

 

19,039

 

 

 

17,247

 

 

16,169

 

 

 

16,413

 

 

15,346

Short-term borrowings

 

 

11,588

 

 

 

13,495

 

 

14,212

 

 

 

17,706

 

 

12,444

Notes payable

 

 

3,590

 

 

 

3,596

 

 

4,026

 

 

 

3,973

 

 

3,853

Other

 

 

2,632

 

 

 

2,864

 

 

2,408

 

 

 

2,342

 

 

2,255

Total interest expense

 

 

105,993

 

 

 

105,541

 

 

101,105

 

 

 

95,160

 

 

69,722

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income

 

 

103,621

 

 

 

111,226

 

 

115,650

 

 

 

118,266

 

 

121,705

Provision for (reversal of) credit losses

 

 

(2,871

)

 

 

1,265

 

 

(40

)

 

 

14,836

 

 

2,331

Net interest income after provision for (reversal of) credit losses

 

 

106,492

 

 

 

109,961

 

 

115,690

 

 

 

103,430

 

 

119,374

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net gains from sale of loans and other mortgage production income

 

 

40,197

 

 

 

36,387

 

 

47,262

 

 

 

48,535

 

 

39,966

Mortgage loan origination fees

 

 

26,438

 

 

 

32,844

 

 

41,478

 

 

 

41,440

 

 

28,777

Securities commissions and fees

 

 

35,557

 

 

 

33,002

 

 

28,044

 

 

 

29,606

 

 

31,223

Investment and securities advisory fees and commissions

 

 

30,226

 

 

 

35,780

 

 

39,662

 

 

 

32,037

 

 

26,848

Other

 

 

49,200

 

 

 

40,965

 

 

40,403

 

 

 

39,034

 

 

35,680

Total noninterest income

 

 

181,618

 

 

 

178,978

 

 

196,849

 

 

 

190,652

 

 

162,494

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest expense:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Employees' compensation and benefits

 

 

165,830

 

 

 

160,390

 

 

173,195

 

 

 

176,908

 

 

167,817

Occupancy and equipment, net

 

 

21,912

 

 

 

21,524

 

 

21,912

 

 

 

23,025

 

 

22,865

Professional services

 

 

9,731

 

 

 

13,170

 

 

12,639

 

 

 

12,594

 

 

10,697

Other

 

 

52,550

 

 

 

55,761

 

 

52,271

 

 

 

54,450

 

 

49,091

Total noninterest expense

 

 

250,023

 

 

 

250,845

 

 

260,017

 

 

 

266,977

 

 

250,470

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income before income taxes

 

 

38,087

 

 

 

38,094

 

 

52,522

 

 

 

27,105

 

 

31,398

Income tax expense

 

 

8,565

 

 

 

7,132

 

 

13,211

 

 

 

7,167

 

 

3,630

Net income

 

 

29,522

 

 

 

30,962

 

 

39,311

 

 

 

19,938

 

 

27,768

Less: Net income attributable to noncontrolling interest

 

 

1,854

 

 

 

2,291

 

 

2,269

 

 

 

1,805

 

 

1,968

Income attributable to Hilltop

 

$

27,668

 

 

$

28,671

 

$

37,042

 

 

$

18,133

 

$

25,800

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per common share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.42

 

 

$

0.44

 

$

0.57

 

 

$

0.28

 

$

0.40

Diluted

 

$

0.42

 

 

$

0.44

 

$

0.57

 

 

$

0.28

 

$

0.40

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash dividends declared per common share

 

$

0.17

 

 

$

0.16

 

$

0.16

 

 

$

0.16

 

$

0.16

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

65,200

 

 

 

65,136

 

 

65,106

 

 

 

65,025

 

 

64,901

Diluted

 

 

65,214

 

 

 

65,138

 

 

65,108

 

 

 

65,054

 

 

64,954

 

 

Three Months Ended March 31, 2024

Segment Results

 

 

 

 

 

 

 

Mortgage

 

 

 

 

All Other and

 

Hilltop

(in 000's)

 

Banking

 

Broker-Dealer

 

Origination

 

Corporate

 

Eliminations

 

Consolidated

Net interest income (expense)

 

$

91,606

 

 

$

12,269

 

 

$

(4,252

)

 

$

(3,103

)

 

$

7,101

 

 

$

103,621

 

Provision for (reversal of) credit losses

 

 

(2,853

)

 

 

(18

)

 

 

?

 

 

 

?

 

 

 

?

 

 

 

(2,871

)

Noninterest income

 

 

11,903

 

 

 

104,578

 

 

 

66,700

 

 

 

5,785

 

 

 

(7,348

)

 

 

181,618

 

Noninterest expense

 

 

56,020

 

 

 

97,947

 

 

 

78,898

 

 

 

17,384

 

 

 

(226

)

 

 

250,023

 

Income (loss) before taxes

 

$

50,342

 

 

$

18,918

 

 

$

(16,450

)

 

$

(14,702

)

 

$

(21

)

 

$

38,087

 

 

 

Three Months Ended

 

 

March 31,

 

December 31,

 

September 30,

 

June 30,

 

March 31,

Selected Financial Data

 

2024

 

2023

 

2023

 

2023

 

2023

 

 

 

 

 

 

 

 

 

 

 

Hilltop Consolidated:

 

 

 

 

 

 

 

 

 

 

Return on average stockholders' equity

 

5.23

%

 

5.46

%

 

7.11

%

 

3.53

%

 

5.12

%

Return on average assets

 

0.74

%

 

0.75

%

 

0.94

%

 

0.47

%

 

0.69

%

Net interest margin (1)

 

2.85

%

 

2.96

%

 

3.02

%

 

3.03

%

 

3.28

%

Net interest margin (taxable equivalent) (2):

 

 

 

 

 

 

 

 

 

 

As reported

 

2.87

%

 

2.98

%

 

3.04

%

 

3.03

%

 

3.28

%

Impact of purchase accounting

 

4 bps

 

4 bps

 

7 bps

 

9 bps

 

6 bps

Book value per common share ($)

 

32.66

 

 

32.58

 

 

31.91

 

 

31.71

 

 

31.63

 

Shares outstanding, end of period (000's)

 

65,267

 

 

65,153

 

 

65,170

 

 

65,071

 

 

65,023

 

Dividend payout ratio (3)

 

40.06

%

 

36.35

%

 

28.12

%

 

57.37

%

 

40.25

%

 

 

 

 

 

 

 

 

 

 

 

Banking Segment:

 

 

 

 

 

 

 

 

 

 

Net interest margin (1)

 

3.00

%

 

2.94

%

 

3.08

%

 

3.11

%

 

3.40

%

Net interest margin (taxable equivalent) (2):

 

 

 

 

 

 

 

 

 

 

As reported

 

3.00

%

 

2.95

%

 

3.09

%

 

3.11

%

 

3.41

%

Impact of purchase accounting

 

5 bps

 

5 bps

 

8 bps

 

11 bps

 

7 bps

Accretion of discount on loans ($000's)

 

1,299

 

 

1,202

 

 

2,226

 

 

3,334

 

 

1,870

 

Net recoveries (charge-offs) ($000's)

 

(4,311

)

 

(674

)

 

1,556

 

 

(2,884

)

 

(419

)

Return on average assets

 

1.20

%

 

1.12

%

 

1.20

%

 

0.89

%

 

1.44

%

Fee income ratio

 

11.5

%

 

11.2

%

 

10.5

%

 

10.0

%

 

9.6

%

Efficiency ratio

 

54.1

%

 

53.2

%

 

51.4

%

 

51.2

%

 

48.4

%

Employees' compensation and benefits ($000's)

 

32,389

 

 

29,420

 

 

30,641

 

 

30,603

 

 

32,681

 

 

 

 

 

 

 

 

 

 

 

 

Broker-Dealer Segment:

 

 

 

 

 

 

 

 

 

 

Net revenue ($000's) (4)

 

116,847

 

 

119,989

 

 

118,703

 

 

113,241

 

 

104,498

 

Employees' compensation and benefits ($000's)

 

69,457

 

 

68,746

 

 

69,930

 

 

65,290

 

 

62,429

 

Variable compensation expense ($000's)

 

35,274

 

 

39,435

 

 

39,929

 

 

34,798

 

 

30,821

 

Compensation as a % of net revenue

 

59.4

%

 

57.3

%

 

58.9

%

 

57.7

%

 

59.7

%

Pre-tax margin (5)

 

16.2

%

 

16.8

%

 

18.2

%

 

16.3

%

 

12.8

%

 

 

 

 

 

 

 

 

 

 

 

Mortgage Origination Segment:

 

 

 

 

 

 

 

 

 

 

Mortgage loan originations - volume ($000's):

 

 

 

 

 

 

 

 

 

 

Home purchases

 

1,548,941

 

 

1,698,009

 

 

2,091,444

 

 

2,301,007

 

 

1,607,330

 

Refinancings

 

127,545

 

 

117,018

 

 

152,257

 

 

150,643

 

 

125,423

 

Total mortgage loan originations - volume

 

1,676,486

 

 

1,815,027

 

 

2,243,701

 

 

2,451,650

 

 

1,732,753

 

Mortgage loan sales - volume ($000's)

 

1,749,857

 

 

1,874,001

 

 

2,395,357

 

 

2,115,706

 

 

1,661,521

 

Net gains from mortgage loan sales (basis points):

 

 

 

 

 

 

 

 

 

 

Loans sold to third parties

 

221

 

 

189

 

 

199

 

 

207

 

 

193

 

Impact of loans retained by banking segment

 

(5

)

 

0

 

 

(1

)

 

(6

)

 

(7

)

As reported

 

216

 

 

189

 

 

198

 

 

201

 

 

186

 

Mortgage servicing rights asset ($000's) (6)

 

95,591

 

 

96,662

 

 

104,951

 

 

95,101

 

 

103,314

 

Employees' compensation and benefits ($000's)

 

52,694

 

 

53,766

 

 

64,016

 

 

70,982

 

 

62,355

 

Variable compensation expense ($000's)

 

22,188

 

 

24,085

 

 

33,070

 

 

36,249

 

 

25,573

 

_____________________________

(1)

 

Net interest margin is defined as net interest income divided by average interest-earning assets.

(2)

 

Net interest margin (taxable equivalent), a non-GAAP measure, is defined as taxable equivalent net interest income divided by average interest-earning assets. Taxable equivalent adjustments are based on the applicable 21% federal income tax rate for all periods presented. The interest income earned on certain earning assets is completely or partially exempt from federal income tax. As such, these tax-exempt instruments typically yield lower returns than taxable investments. To provide more meaningful comparisons of net interest margins for all earning assets, we use net interest income on a taxable-equivalent basis in calculating net interest margin by increasing the interest income earned on tax-exempt assets to make it fully equivalent to interest income earned on taxable investments. The taxable equivalent adjustments to interest income for Hilltop (consolidated) were $0.6 million, $0.6 million, $0.6 million, $0.1 million and $0.1 million, respectively, for the periods presented and for the banking segment were $0.1 million, $0.2 million, $0.2 million, $0.2 million and $0.2 million, respectively, for the periods presented.

(3)

 

Dividend payout ratio is defined as cash dividends declared per common share divided by basic earnings per common share.

(4)

 

Net revenue is defined as the sum of total broker-dealer net interest income and total broker-dealer noninterest income.

(5)

 

Pre-tax margin is defined as income before income taxes divided by net revenue.

(6)

 

Reported on a consolidated basis and therefore does not include mortgage servicing rights assets related to loans serviced for the banking segment, which are eliminated in consolidation.

 

 

March 31,

 

December 31,

 

September 30,

 

June 30,

 

March 31,

Capital Ratios

 

2024

 

2023

 

2023

 

2023

 

2023

Tier 1 capital (to average assets):

 

 

 

 

 

 

 

 

 

 

PlainsCapital

 

11.00

%

 

10.55

%

 

10.62

%

 

10.28

%

 

10.69

%

Hilltop

 

12.49

%

 

12.23

%

 

11.92

%

 

11.47

%

 

11.82

%

Common equity Tier 1 capital (to risk-weighted assets):

 

 

 

 

 

 

 

 

 

 

PlainsCapital

 

15.87

%

 

15.44

%

 

15.31

%

 

14.48

%

 

14.97

%

Hilltop

 

19.73

%

 

19.32

%

 

18.60

%

 

17.61

%

 

17.99

%

Tier 1 capital (to risk-weighted assets):

 

 

 

 

 

 

 

 

 

 

PlainsCapital

 

15.87

%

 

15.44

%

 

15.31

%

 

14.48

%

 

14.97

%

Hilltop

 

19.73

%

 

19.32

%

 

18.60

%

 

17.61

%

 

17.99

%

Total capital (to risk-weighted assets):

 

 

 

 

 

 

 

 

 

 

PlainsCapital

 

17.06

%

 

16.58

%

 

16.45

%

 

15.56

%

 

15.94

%

Hilltop

 

22.79

%

 

22.34

%

 

21.54

%

 

20.41

%

 

20.75

%

 

 

March 31,

 

December 31,

 

September 30,

 

June 30,

 

March 31,

Non-Performing Assets Portfolio Data

 

2024

 

2023

 

2023

 

2023

 

2023

Loans accounted for on a non-accrual basis ($000's):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial real estate:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-owner occupied

 

$

34,661

 

 

$

36,440

 

 

$

2,375

 

 

$

2,456

 

 

$

1,038

 

Owner occupied

 

 

4,846

 

 

 

5,098

 

 

 

4,964

 

 

 

1,096

 

 

 

935

 

Commercial and industrial

 

 

12,165

 

 

 

9,502

 

 

 

10,190

 

 

 

21,442

 

 

 

10,807

 

Construction and land development

 

 

698

 

 

 

3,480

 

 

 

760

 

 

 

593

 

 

 

199

 

1-4 family residential

 

 

12,363

 

 

 

13,801

 

 

 

13,202

 

 

 

13,360

 

 

 

14,387

 

Consumer

 

 

3

 

 

 

6

 

 

 

7

 

 

 

9

 

 

 

12

 

Broker-dealer

 

 

?

 

 

 

?

 

 

 

?

 

 

 

?

 

 

 

?

 

Non-accrual loans ($000's)

 

$

64,736

 

 

$

68,327

 

 

$

31,498

 

 

$

38,956

 

 

$

27,378

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-accrual loans as a % of total loans ($000's)

 

 

0.73

%

 

 

0.76

%

 

 

0.34

%

 

 

0.40

%

 

 

0.30

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other real estate owned ($000's)

 

 

5,254

 

 

 

5,095

 

 

 

5,386

 

 

 

3,481

 

 

 

3,202

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other repossessed assets ($000's)

 

 

472

 

 

 

?

 

 

 

?

 

 

 

?

 

 

 

?

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-performing assets ($000's)

 

 

70,462

 

 

 

73,422

 

 

 

36,884

 

 

 

42,437

 

 

 

30,580

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-performing assets as a % of total assets ($000's)

 

 

0.43

%

 

 

0.45

%

 

 

0.22

%

 

 

0.25

%

 

 

0.18

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans past due 90 days or more and still accruing ($000's) (1)

 

 

112,799

 

 

 

115,090

 

 

 

106,346

 

 

 

130,036

 

 

 

114,523

 

_____________________________

(1)

 

Loans past due 90 days or more and still accruing were primarily comprised of loans held for sale and guaranteed by U.S. government agencies, including loans that are subject to repurchase, or have been repurchased, by PrimeLending.

 

 

Three Months Ended March 31,

 

 

 

2024

 

2023

 

 

 

Average

 

Interest

 

Annualized

 

Average

 

Interest

 

Annualized

 

Net Interest Margin (Taxable Equivalent) Details (1)

 

Outstanding

 

Earned

 

Yield or

 

Outstanding

 

Earned

 

Yield or

 

 

Balance

 

or Paid

 

Rate

 

Balance

 

or Paid

 

Rate

 

Assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-earning assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans held for sale

 

$

802,098

 

 

$

11,655

 

5.81

%

$

815,393

 

 

$

10,724

 

5.26

%

Loans held for investment, gross (2)

 

 

7,835,647

 

 

 

122,676

 

6.28

%

 

7,894,668

 

 

 

112,655

 

5.79

%

Investment securities - taxable

 

 

2,619,081

 

 

 

26,241

 

4.01

%

 

2,813,734

 

 

 

25,602

 

3.64

%

Investment securities - non-taxable (3)

 

 

293,420

 

 

 

2,992

 

4.08

%

 

412,543

 

 

 

3,286

 

3.19

%

Federal funds sold and securities purchased under agreements to resell

 

 

94,108

 

 

 

1,631

 

6.95

%

 

163,601

 

 

 

2,368

 

5.87

%

Interest-bearing deposits in other financial institutions

 

 

1,458,784

 

 

 

19,245

 

5.29

%

 

1,480,323

 

 

 

16,116

 

4.42

%

Securities borrowed

 

 

1,442,870

 

 

 

20,561

 

5.64

%

 

1,419,797

 

 

 

17,068

 

4.81

%

Other

 

 

39,885

 

 

 

5,190

 

52.19

%

 

63,219

 

 

 

3,706

 

23.77

%

Interest-earning assets, gross (3)

 

 

14,585,893

 

 

 

210,191

 

5.78

%

 

15,063,278

 

 

 

191,525

 

5.16

%

Allowance for credit losses

 

 

(110,583

)

 

 

 

 

 

 

 

(97,060

)

 

 

 

 

 

 

Interest-earning assets, net

 

 

14,475,310

 

 

 

 

 

 

 

 

14,966,218

 

 

 

 

 

 

 

Noninterest-earning assets

 

 

1,522,337

 

 

 

 

 

 

 

 

1,336,908

 

 

 

 

 

 

 

Total assets

 

$

15,997,647

 

 

 

 

 

 

 

$

16,303,126

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities and Stockholders' Equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing liabilities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing deposits

 

$

7,748,633

 

 

$

69,144

 

3.58

%

$

7,239,556

 

 

$

35,824

 

2.01

%

Securities loaned

 

 

1,401,975

 

 

 

19,039

 

5.45

%

 

1,323,857

 

 

 

15,346

 

4.70

%

Notes payable and other borrowings

 

 

1,327,889

 

 

 

17,810

 

5.38

%

 

1,490,075

 

 

 

18,552

 

5.05

%

Total interest-bearing liabilities

 

 

10,478,497

 

 

 

105,993

 

4.06

%

 

10,053,488

 

 

 

69,722

 

2.81

%

Noninterest-bearing liabilities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing deposits

 

 

2,951,357

 

 

 

 

 

 

 

 

3,789,757

 

 

 

 

 

 

 

Other liabilities

 

 

420,355

 

 

 

 

 

 

 

 

390,107

 

 

 

 

 

 

 

Total liabilities

 

 

13,850,209

 

 

 

 

 

 

 

 

14,233,352

 

 

 

 

 

 

 

Stockholders' equity

 

 

2,120,494

 

 

 

 

 

 

 

 

2,043,157

 

 

 

 

 

 

 

Noncontrolling interest

 

 

26,944

 

 

 

 

 

 

 

 

26,617

 

 

 

 

 

 

 

Total liabilities and stockholders' equity

 

$

15,997,647

 

 

 

 

 

 

 

$

16,303,126

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income (3)

 

 

 

 

$

104,198

 

 

 

 

 

 

$

121,803

 

 

 

Net interest spread (3)

 

 

 

 

 

 

 

1.72

%

 

 

 

 

 

 

2.35

%

Net interest margin (3)

 

 

 

 

 

 

 

2.87

%

 

 

 

 

 

 

3.28

%

_____________________________

(1)

 

Information presented on a consolidated basis.

(2)

 

Average balance includes non-accrual loans.

(3)

 

Presented on a taxable-equivalent basis with annualized taxable equivalent adjustments based on the applicable 21% federal income tax rate for the periods presented. The adjustment to interest income was $0.6 million and $0.1 million for the three months ended March 31, 2024 and 2023, respectively.

Conference Call Information

Hilltop will host a live webcast and conference call at 8:00 AM Central (9:00 AM Eastern) on Friday, April 19, 2024. Hilltop President and CEO Jeremy B. Ford and Hilltop CFO William B. Furr will review first quarter 2024 financial results. Interested parties can access the conference call by dialing 800-579-2543 (North America) or 785-424-1789 (International) and then using the conference ID HH1Q24. The conference call also will be webcast simultaneously on Hilltop's Investor Relations website (http://ir.hilltop.com).

About Hilltop

Hilltop Holdings is a Dallas-based financial holding company. Its primary line of business is to provide business and consumer banking services from offices located throughout Texas through PlainsCapital Bank. PlainsCapital Bank's wholly owned subsidiary, PrimeLending, provides residential mortgage lending throughout the United States. Hilltop Holdings' broker-dealer subsidiaries, Hilltop Securities Inc. and Momentum Independent Network Inc., provide a full complement of securities brokerage, institutional and investment banking services in addition to clearing services and retail financial advisory. At March 31, 2024, Hilltop employed approximately 3,740 people and operated approximately 325 locations in 48 states. Hilltop Holdings' common stock is listed on the New York Stock Exchange under the symbol "HTH." Find more information at Hilltop.com, PlainsCapital.com, PrimeLending.com and HilltopSecurities.com.

FORWARD-LOOKING STATEMENTS

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements anticipated in such statements. Forward-looking statements speak only as of the date they are made and, except as required by law, we do not assume any duty to update forward-looking statements. Such forward-looking statements include, but are not limited to, statements concerning such things as our plans, objectives, strategies, expectations, intentions and other statements that are not statements of historical fact, and may be identified by words such as "aim," "anticipates," "believes," "building," "continue," "could," "drive," "estimates," "expects," "extent," "focus," "forecasts," "goal," "guidance," "intends," "may," "might," "outlook," "plan," "position," "probable," "progressing," "projects," "prudent," "seeks," "should," "steady," "target," "view," "will" or "would" or the negative of these words and phrases or similar words or phrases. The following factors, among others, could cause actual results to differ materially from those set forth in the forward-looking statements: (i) the credit risks of lending activities, including our ability to estimate credit losses and the allowance for credit losses, as well as the effects of changes in the level of, and trends in, loan delinquencies and write-offs; (ii) effectiveness of our data security controls in the face of cyber attacks and any legal, reputational and financial risks following a cybersecurity incident; (iii) changes in general economic, market and business conditions in areas or markets where we compete, including changes in the price of crude oil; (iv) changes in the interest rate environment; (v) risks associated with concentration in real estate related loans and (vi) disruptions to the economy and financial services industry, and (vii) risks associated with uninsured deposits and responsive measures by federal or state governments or banking regulators, including increases in the cost of our deposit insurance assessments. For further discussion of such factors, see the risk factors described in our most recent Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q and other reports that are filed with the Securities and Exchange Commission. All forward-looking statements are qualified in their entirety by this cautionary statement.


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