ý | Annual Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934. |
¨ | Transition Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934. |
Delaware | 75-2679109 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification Number) |
2000 McKinney Avenue, Suite 700, Dallas, Texas, U.S.A. | 75201 | |
(Address of principal executive officers) | (Zip Code) |
Large Accelerated Filer x | Accelerated Filer ¨ | Non-Accelerated Filer ¨ | Non-Accelerated Filer ¨ | |||
(Do not check if a smaller reporting company) |
PART I | ||
Item 1. | ||
Item 1A. | ||
Item 1B. | ||
Item 2. | ||
Item 3. | ||
Item 4. | ||
PART II | ||
Item 5. | ||
Item 6. | ||
Item 7. | ||
Item 7A. | ||
Item 8. | ||
Item 9. | ||
Item 9A. | ||
Item 9B. | ||
PART III | ||
Item 10. | ||
Item 11. | ||
Item 12. | ||
Item 13. | ||
Item 14. | ||
PART IV | ||
Item 15. |
ITEM 1. | BUSINESS |
December 31, | |||||||||||||||||||
2017 | 2016 | 2015 | 2014 | 2013 | |||||||||||||||
Loans held for sale | $ | 1,011,004 | $ | 968,929 | $ | 86,075 | $ | — | $ | — | |||||||||
Loans held for investment, mortgage finance | 5,308,160 | 4,497,338 | 4,966,276 | 4,102,125 | 2,784,265 | ||||||||||||||
Loans held for investment, net | 15,366,252 | 13,001,011 | 11,745,674 | 10,154,887 | 8,486,603 | ||||||||||||||
Assets | 25,075,645 | 21,697,134 | 18,903,821 | 15,900,034 | 11,717,174 | ||||||||||||||
Demand deposits | 7,812,660 | 7,994,201 | 6,386,911 | 5,011,619 | 3,347,567 | ||||||||||||||
Total deposits | 19,123,180 | 17,016,831 | 15,084,619 | 12,673,300 | 9,257,379 | ||||||||||||||
Stockholders’ equity | 2,202,721 | 2,009,557 | 1,623,533 | 1,484,190 | 1,096,350 |
December 31, | |||||||||||||||||||
2017 | 2016 | 2015 | 2014 | 2013 | |||||||||||||||
Commercial | $ | 9,189,811 | $ | 7,291,545 | $ | 6,672,631 | $ | 5,869,219 | $ | 5,020,565 | |||||||||
Total real estate | 5,960,785 | 5,560,909 | 4,990,914 | 4,223,532 | 3,409,427 | ||||||||||||||
Construction | 2,166,208 | 2,098,706 | 1,851,717 | 1,416,405 | 1,262,905 | ||||||||||||||
Real estate term | 3,794,577 | 3,462,203 | 3,139,197 | 2,807,127 | 2,146,522 | ||||||||||||||
Mortgage finance | 5,308,160 | 4,497,338 | 4,966,276 | 4,102,125 | 2,784,265 | ||||||||||||||
Equipment leases | 264,903 | 185,529 | 113,996 | 99,495 | 93,160 | ||||||||||||||
Consumer | 48,684 | 34,587 | 25,323 | 19,699 | 15,350 |
• | targeting middle market businesses and successful professionals and entrepreneurs; |
• | growing our loan and deposit base in our existing markets by hiring additional experienced bankers in our different lines of business; |
• | developing lines of business that leverage our strengths and complement our existing lines of business; |
• | continuing our emphasis on credit policy to maintain credit quality consistent with long-term objectives; |
• | leveraging our existing infrastructure with improvements in technology and processes to gain efficiencies to support a larger volume of business; |
• | maintaining effective internal approval processes for capital and operating expenditures; |
• | continuing our extensive use of outsourcing to provide cost-effective and more efficient operational support and service levels consistent with large-bank operations; and |
• | extending our reach within our target markets and lines of business through service innovation and service excellence. |
• | commercial loans for general corporate purposes including financing for working capital, internal growth, acquisitions and financing for business insurance premiums; |
• | real estate term and construction loans; |
• | mortgage warehouse lending; |
• | mortgage correspondent aggregation; |
• | equipment finance and leasing; |
• | medium- and long-term tax-exempt loans for municipalities and other governmental and tax-exempt entities; |
• | treasury management services, including online banking and debit and credit card services; and |
• | letters of credit. |
• | personal wealth management and trust services; |
• | certificates of deposit and IRAs; |
• | interest-bearing and non-interest-bearing checking accounts; |
• | traditional money market and savings accounts; |
• | loans, both secured and unsecured; and |
• | online and mobile banking. |
• | Well capitalized - equals or exceeds a 10% total risk-based capital ratio, 8% Tier 1 risk-based capital ratio, and 5% leverage ratio and is not subject to any written agreement, order or directive requiring it to maintain a specific level for any capital measure; |
• | Adequately capitalized - equals or exceeds an 8% total risk-based capital ratio, 6% Tier 1 risk-based capital ratio, and 4% leverage ratio; |
• | Undercapitalized - total risk-based capital ratio of less than 8%, or a Tier 1 risk-based ratio of less than 6%, or a leverage ratio of less than 4%; |
• | Significantly undercapitalized - total risk-based capital ratio of less than 6%, or a Tier 1 risk-based capital ratio of less than 4%, or a leverage ratio of less than 3%; and |
• | Critically undercapitalized-a ratio of tangible equity to total assets equal to or less than 2%. |
• | allows bank holding companies meeting management, capital and Community Reinvestment Act standards to engage in a substantially broader range of non-banking activities than was permissible prior to enactment, including insurance underwriting and making merchant banking investments in commercial and financial companies; |
• | allows insurers and other financial services companies to acquire banks; |
• | removes various restrictions that applied to bank holding company ownership of securities firms and mutual fund advisory companies; and |
• | establishes the overall regulatory structure applicable to bank holding companies that also engage in insurance and securities operations. |
ITEM 1A. | RISK FACTORS |
• | Adverse changes in local, U.S. and global economic and industry conditions; |
• | Declines in the value of collateral, including asset values that are directly or indirectly related to external factors such as commodity prices, real estate values or interest rates; |
• | Concentrations of credit associated with specific loan categories, industries or collateral types; and |
• | Exposures to individual borrowers and to groups of entities that may be affiliated on some basis that individually and/or collectively represent a larger percentage of our total loans or capital than might be considered common at other banks of similar size. |
• | national, regional and local economic conditions; |
• | the value of the U.S. Dollar in relation to the currencies of other advanced and emerging market countries; |
• | the performance of both domestic and international equity and debt markets and valuation of securities represented and traded on recognized domestic and international exchanges; |
• | fluctuations in the value of commodities including but not limited to petroleum and natural gas; |
• | general economic consequences of international conditions, such as weakness in European sovereign debt and foreign currencies and the impact of that weakness on the US and global economies; |
• | legislative and regulatory changes impacting our industry; |
• | the financial health of our customers and economic conditions affecting them and the value of our collateral, including effects from continued price volatility of oil and gas and other commodities; |
• | the incidence of fraud, illegal payments, security breaches and other illegal acts among or impacting our Bank and our customers; |
• | structural changes in the markets for origination, sale and servicing of residential mortgages; |
• | changes in governmental economic and regulatory policies generally, including the extent and timing of intervention in credit markets by the Federal Reserve Board or withdrawal from that intervention; |
• | changes in the availability of liquidity at a systemic level; and |
• | material inflation or deflation. |
• | continue to identify and expand into suitable markets and lines of business, in Texas, regionally and nationally; |
• | develop new products and services and execute our full range of products and services more efficiently and effectively; |
• | attract and retain qualified bankers in each of our targeted markets to build our customer base; |
• | respond to market opportunities promptly and nimbly while balancing the demands of risk management and compliance with regulatory requirements; |
• | expand our loan portfolio in an intensely competitive environment while maintaining credit quality; |
• | attract sufficient deposits and capital to fund our anticipated loan growth and satisfy regulatory requirements; |
• | control expenses; and |
• | acquire and maintain sufficient qualified staffing and information technology and operational infrastructure to support growth and compliance with increasing and changing regulatory requirements. |
• | Brokered deposits; |
• | The Federal Reserve discount window; |
• | Advances from the Federal Home Loan Bank; |
• | Capital markets transactions; and |
• | Development of new financial services. |
• | actual or anticipated variations in quarterly and annual results of operations; |
• | changes in recommendations by securities analysts; |
• | changes in composition and perceptions of the investors who own our stock and other securities; |
• | changes in ratings from national rating agencies on publicly or privately owned debt securities and deposits in our Bank; |
• | operating and stock price performance of other companies that investors deem comparable to us; |
• | news reports relating to trends, concerns and other issues in the financial services industry, including regulatory actions against other financial institutions; |
• | actual or expected economic conditions that are perceived to affect our company such as changes in commodity prices, real estate values or interest rates; |
• | perceptions in the marketplace regarding us and/or our competitors; |
• | new technology used, or services offered, by competitors; |
• | significant acquisitions or business combinations, strategic partnerships, joint ventures or capital commitments by or involving us or our competitors; |
• | changes in government regulations and interpretation of those regulations, changes in our practices requested or required by regulators and changes in regulatory enforcement focus; and |
• | geopolitical conditions such as acts or threats of terrorism or military conflicts. |
ITEM 1B. | UNRESOLVED STAFF COMMENTS |
ITEM 2. | PROPERTIES |
ITEM 3. | LEGAL PROCEEDINGS |
ITEM 4. | MINE SAFETY DISCLOSURES |
ITEM 5. | MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES |
Price Per Share | |||||
Quarter Ended | High | Low | |||
March 31, 2016 | 49.88 | 29.78 | |||
June 30, 2016 | 51.84 | 34.54 | |||
September 30, 2016 | 55.25 | 42.36 | |||
December 31, 2016 | 81.25 | 54.20 | |||
March 31, 2017 | 93.35 | 75.80 | |||
June 30, 2017 | 84.35 | 70.65 | |||
September 30, 2017 | 87.50 | 69.65 | |||
December 31, 2017 | 95.20 | 77.65 |
12/31/2012 | 12/31/2013 | 12/31/2014 | 12/31/2015 | 12/31/2016 | 12/31/2017 | ||||||||||||||||||
Texas Capital | |||||||||||||||||||||||
Bancshares, Inc. | $ | 100.00 | $ | 138.78 | $ | 121.22 | $ | 110.26 | $ | 174.92 | $ | 198.35 | |||||||||||
Russell 2000 | |||||||||||||||||||||||
Index (RTY) | 100.00 | 136.65 | 141.62 | 133.77 | 159.59 | 180.42 | |||||||||||||||||
Nasdaq Bank | |||||||||||||||||||||||
Index (CBNK) | 100.00 | 137.95 | 142.12 | 151.67 | 204.03 | 211.49 |
ITEM 6. | SELECTED CONSOLIDATED FINANCIAL DATA |
At or For the Year Ended December 31, | |||||||||||||||||||
2017 | 2016 | 2015 | 2014 | 2013 | |||||||||||||||
(In thousands, except per share, average share and percentage data) | |||||||||||||||||||
Consolidated Operating Data(1) | |||||||||||||||||||
Interest income | $ | 879,299 | $ | 703,408 | $ | 602,958 | $ | 514,547 | $ | 444,625 | |||||||||
Interest expense | 117,971 | 63,594 | 46,428 | 37,582 | 25,112 | ||||||||||||||
Net interest income | 761,328 | 639,814 | 556,530 | 476,965 | 419,513 | ||||||||||||||
Provision for credit losses | 44,000 | 77,000 | 53,250 | 22,000 | 19,000 | ||||||||||||||
Net interest income after provision for credit losses | 717,328 | 562,814 | 503,280 | 454,965 | 400,513 | ||||||||||||||
Non-interest income | 74,256 | 60,780 | 47,738 | 42,511 | 44,024 | ||||||||||||||
Non-interest expense | 465,876 | 382,397 | 326,523 | 285,114 | 256,729 | ||||||||||||||
Income before income taxes | 325,708 | 241,197 | 224,495 | 212,362 | 187,808 | ||||||||||||||
Income tax expense | 128,645 | 86,078 | 79,641 | 76,010 | 66,757 | ||||||||||||||
Net income | 197,063 | 155,119 | 144,854 | 136,352 | 121,051 | ||||||||||||||
Preferred stock dividends | 9,750 | 9,750 | 9,750 | 9,750 | 7,394 | ||||||||||||||
Net income available to common stockholders | $ | 187,313 | $ | 145,369 | $ | 135,104 | $ | 126,602 | $ | 113,657 | |||||||||
Consolidated Balance Sheet Data(1) | |||||||||||||||||||
Total assets | $ | 25,075,645 | $ | 21,697,134 | $ | 18,903,821 | $ | 15,900,034 | $ | 11,717,174 | |||||||||
Loans held for sale, MCA | 1,007,695 | 968,929 | 86,075 | — | — | ||||||||||||||
Loans held for investment | 15,366,252 | 13,001,011 | 11,745,674 | 10,154,887 | 8,486,603 | ||||||||||||||
Loans held for investment, mortgage finance loans | 5,308,160 | 4,497,338 | 4,966,276 | 4,102,125 | 2,784,265 | ||||||||||||||
Liquidity assets(2) | 2,727,581 | 2,725,645 | 1,681,374 | 1,233,990 | 61,427 | ||||||||||||||
Securities available-for-sale | 23,511 | 24,874 | 29,992 | 41,719 | 63,214 | ||||||||||||||
Demand deposits | 7,812,660 | 7,994,201 | 6,386,911 | 5,011,619 | 3,347,567 | ||||||||||||||
Total deposits | 19,123,180 | 17,016,831 | 15,084,619 | 12,673,300 | 9,257,379 | ||||||||||||||
Federal funds purchased and repurchase agreements | 365,040 | 109,575 | 143,051 | 92,676 | 170,604 | ||||||||||||||
Other borrowings | 2,800,000 | 2,000,000 | 1,500,000 | 1,100,005 | 855,026 | ||||||||||||||
Subordinated notes | 281,406 | 281,044 | 280,682 | 280,321 | 108,110 | ||||||||||||||
Trust preferred subordinated debentures | 113,406 | 113,406 | 113,406 | 113,406 | 113,406 | ||||||||||||||
Stockholders’ equity | 2,202,721 | 2,009,557 | 1,623,533 | 1,484,190 | 1,096,350 |
At or For the Year Ended December 31, | |||||||||||||||||||
2017 | 2016 | 2015 | 2014 | 2013 | |||||||||||||||
(In thousands, except per share, average share and percentage data) | |||||||||||||||||||
Other Financial Data | |||||||||||||||||||
Income per share | |||||||||||||||||||
Basic | $ | 3.78 | $ | 3.14 | $ | 2.95 | $ | 2.93 | $ | 2.78 | |||||||||
Diluted | 3.73 | 3.11 | 2.91 | 2.88 | 2.72 | ||||||||||||||
Tangible book value per share(3) | 40.97 | 37.17 | 31.69 | 28.72 | 22.54 | ||||||||||||||
Book value per share | 41.35 | 37.56 | 32.12 | 29.17 | 23.06 | ||||||||||||||
Weighted average shares | |||||||||||||||||||
Basic | 49,587,169 | 46,239,210 | 45,808,440 | 43,236,344 | 40,864,225 | ||||||||||||||
Diluted | 50,259,834 | 46,765,902 | 46,437,872 | 44,003,256 | 41,779,881 | ||||||||||||||
Selected Financial Ratios | |||||||||||||||||||
Performance Ratios | |||||||||||||||||||
Net interest margin | 3.49 | % | 3.14 | % | 3.14 | % | 3.78 | % | 4.22 | % | |||||||||
Return on average assets | 0.87 | % | 0.74 | % | 0.79 | % | 1.05 | % | 1.17 | % | |||||||||
Return on average equity | 9.51 | % | 9.27 | % | 9.65 | % | 11.31 | % | 12.82 | % | |||||||||
Efficiency ratio(4) | 55.75 | % | 54.58 | % | 54.04 | % | 54.88 | % | 55.39 | % | |||||||||
Non-interest expense to average earning assets | 2.12 | % | 1.88 | % | 1.84 | % | 2.26 | % | 2.58 | % | |||||||||
Asset Quality Ratios | |||||||||||||||||||
Net charge-offs (recoveries) to average LHI | 0.16 | % | 0.29 | % | 0.07 | % | 0.05 | % | 0.05 | % | |||||||||
Net charge-offs (recoveries) to average LHI excluding mortgage finance loans | 0.21 | % | 0.38 | % | 0.10 | % | 0.07 | % | 0.07 | % | |||||||||
Allowance for loan losses to LHI | 0.89 | % | 0.96 | % | 0.84 | % | 0.71 | % | 0.78 | % | |||||||||
Allowance for loan losses to LHI excluding mortgage finance loans | 1.20 | % | 1.29 | % | 1.20 | % | 0.99 | % | 1.03 | % | |||||||||
Allowance for loan losses to non-accrual loans | 1.8x | 1.0x | .8x | 2.3x | 2.7x | ||||||||||||||
Non-accrual loans to LHI | 0.49 | % | 0.96 | % | 1.08 | % | 0.30 | % | 0.29 | % | |||||||||
Non-accrual loans to LHI excluding mortgage finance loans | 0.66 | % | 1.29 | % | 1.53 | % | 0.43 | % | 0.38 | % | |||||||||
Total NPAs to LHI plus OREO | 0.55 | % | 1.07 | % | 1.08 | % | 0.31 | % | 0.33 | % | |||||||||
Total NPAs to LHI excluding mortgage finance loans plus OREO | 0.74 | % | 1.43 | % | 1.53 | % | 0.43 | % | 0.44 | % | |||||||||
Capital and Liquidity Ratios(5) | |||||||||||||||||||
CET1 | 8.45 | % | 8.97 | % | 7.47 | % | 7.89 | % | N/A | ||||||||||
Total capital ratio | 9.52 | % | 10.23 | % | 11.05 | % | 11.83 | % | 10.73 | % | |||||||||
Tier 1 capital ratio | 11.50 | % | 12.48 | % | 8.81 | % | 9.46 | % | 9.15 | % | |||||||||
Tier 1 leverage ratio | 9.15 | % | 9.34 | % | 8.92 | % | 10.76 | % | 10.87 | % | |||||||||
Average equity/average assets | 9.33 | % | 8.20 | % | 8.51 | % | 9.75 | % | 9.68 | % | |||||||||
Tangible common equity/total tangible assets(6) | 8.11 | % | 8.49 | % | 7.69 | % | 8.26 | % | 7.87 | % | |||||||||
Average LHI, net/average total deposits | 97.56 | % | 95.82 | % | 101.71 | % | 111.57 | % | 116.25 | % |
(1) | The consolidated operating data and consolidated balance sheet data presented above for the five most recent fiscal years have been derived from our audited consolidated financial statements. The historical results are not necessarily indicative of the results to be expected in any future period. |
(2) | Liquidity assets consist of Federal funds sold and deposits in other banks. |
(3) | Stockholders' equity excluding preferred stock, less goodwill and intangibles, divided by shares outstanding at period end. |
(4) | Non-interest expense divided by the sum of net interest income and non-interest income. |
(5) | The Basel III Capital Rules specifying the CET1 ratio became effective on January 1, 2015. |
(6) | Stockholders' equity excluding preferred stock and accumulated other comprehensive income less goodwill and intangibles divided by total assets less accumulated other comprehensive income and goodwill and intangibles. |
ITEM 7. | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
• | Deterioration of the credit quality of our loan portfolio or declines in the value of collateral related to external factors such as commodity prices, real estate values or interest rates, increased default rates and loan losses or adverse changes in the industry concentrations of our loan portfolio. |
• | Changing economic conditions or other developments adversely affecting our commercial, entrepreneurial and professional customers. |
• | Changes in the value of commercial and residential real estate securing our loans or in the demand for credit to support the purchase and ownership of such assets. |
• | Adverse economic conditions and other factors affecting our middle market customers and their ability to continue to meet their loan obligations. |
• | Unanticipated effects from the Tax Act may limit its benefits or adversely impact our business, which could include decreased demand for borrowing by our middle market customers or increased price competition that offsets the benefits of decreased federal income tax expense. |
• | The failure to correctly assess and model the assumptions supporting our allowance for loan losses, causing it to become inadequate in the event of deteriorations in loan quality and increases in charge-offs. |
• | Changes in the U.S. economy in general or the Texas economy specifically resulting in deterioration of credit quality, increases in non-performing assets or charge-offs or reduced demand for credit or other financial services we offer, including the effects from declines in the level of drilling and production related to the continued volatility in oil and gas prices. |
• | Adverse changes in economic or market conditions, in Texas, the United States or internationally, that could affect the credit quality of our loan portfolio or our operating performance. |
• | Unexpected market conditions or regulatory changes that could cause access to capital market transactions and other sources of funding to become more difficult to obtain on terms and conditions that are acceptable to us. |
• | The inadequacy of our available funds to meet our deposit, debt and other obligations as they become due, or our failure to maintain our capital ratios as a result of adverse changes in our operating performance or financial condition, or changes in applicable regulations or regulator interpretation of regulations impacting our business or the characterization or risk weight of our assets. |
• | The failure to effectively balance our funding sources with cash demands by depositors and borrowers. |
• | The failure to manage information systems risk or to prevent cyber-attacks against us, our customers or our third party vendors, or to manage risks from disruptions or security breaches affecting us, our customers or our third party vendors. |
• | The failure to effectively manage our interest rate risk resulting from unexpectedly large or sudden changes in interest rates or rate or maturity imbalances in our assets and liabilities, and potential adverse effects to our borrowers including their inability to repay loans with increased interest rates. |
• | Legislative and regulatory changes imposing further restrictions and costs on our business, a failure to remain well capitalized or well managed status or regulatory enforcement actions against us, and uncertainty related to future implementation and enforcement of regulatory requirements resulting from the current political environment. |
• | The failure to successfully execute our business strategy, which may include expanding into new markets, developing and launching new lines of business or new products and services within the expected timeframes and budgets or to successfully manage the risks related to the development and implementation of these new businesses, products or services. |
• | The failure to attract and retain key personnel or the loss of key individuals or groups of employees. |
• | Increased or more effective competition from banks and other financial service providers in our markets. |
• | Structural changes in the markets for origination, sale and servicing of residential mortgages. |
• | Uncertainty in the pricing of mortgage loans that we purchase, and later sell or securitize, as well as competition for the MSRs related to these loans and related interest rate risk or price risk resulting from retaining MSRs, and the potential effects of higher interest rates on our MCA loan volumes. |
• | Material failures of our accounting estimates and risk management processes based on management judgment, or the supporting analytical and forecasting models. |
• | Failure of our risk management strategies and procedures, including failure or circumvention of our controls. |
• | Credit risk resulting from our exposure to counterparties. |
• | An increase in the incidence or severity of fraud, illegal payments, security breaches and other illegal acts impacting our Bank and our customers. |
• | The failure to maintain adequate regulatory capital to support our business. |
• | Unavailability of funds obtained from borrowing or capital transactions or from our Bank to fund our obligations. |
• | Incurrence of material costs and liabilities associated with legal and regulatory proceedings and related matters with respect to the financial services industry, including those directly involving us or our Bank. |
• | Environmental liability associated with properties related to our lending activities. |
• | Severe weather, natural disasters, acts of war or terrorism and other external events. |
Years Ended December 31, | |||||||||||||||||||||||
2017/2016 | 2016/2015 | ||||||||||||||||||||||
Net Change | Change Due To(1) | Net Change | Change Due To(1) | ||||||||||||||||||||
Volume | Yield/Rate(2) | Volume | Yield/Rate(2) | ||||||||||||||||||||
Interest income: | |||||||||||||||||||||||
Securities | $ | 88 | $ | 868 | $ | (780 | ) | $ | (305 | ) | $ | (301 | ) | $ | (4 | ) | |||||||
Loans held for sale | 25,150 | 20,183 | 4,967 | 13,766 | 15,667 | (1,901 | ) | ||||||||||||||||
Loans held for investment, mortgage finance loans | 8,528 | (4,906 | ) | 13,434 | 15,070 | 9,004 | 6,066 | ||||||||||||||||
Loans held for investment | 134,234 | 72,328 | 61,906 | 61,222 | 53,751 | 7,471 | |||||||||||||||||
Federal funds sold and securities purchased under resale agreements | 995 | (357 | ) | 1,352 | 865 | 102 | 763 | ||||||||||||||||
Deposits in other banks | 13,087 | (2,174 | ) | 15,261 | 10,019 | 1,792 | 8,227 | ||||||||||||||||
Total | 182,082 | 85,942 | 96,140 | 100,637 | 80,015 | 20,622 | |||||||||||||||||
Interest expense: | |||||||||||||||||||||||
Transaction deposits | 8,071 | (131 | ) | 8,202 | 4,604 | 808 | 3,796 | ||||||||||||||||
Savings deposits | 34,202 | 4,609 | 29,593 | 8,290 | 1,530 | 6,760 | |||||||||||||||||
Time deposits | 438 | (87 | ) | 525 | 294 | (89 | ) | 383 | |||||||||||||||
Deposits in foreign branches | — | — | — | (591 | ) | (591 | ) | — | |||||||||||||||
Other borrowings | 11,084 | 619 | 10,465 | 4,110 | 180 | 3,930 | |||||||||||||||||
Long-term debt | 583 | — | 583 | 458 | 22 | 436 | |||||||||||||||||
Total | 54,378 | 5,010 | 49,368 | 17,165 | 1,860 | 15,305 | |||||||||||||||||
Net interest income | $ | 127,704 | $ | 80,932 | $ | 46,772 | $ | 83,472 | $ | 78,155 | $ | 5,317 |
(1) | Yield/rate and volume variances are allocated to yield/rate. |
(2) | Taxable equivalent rates used where applicable assuming a 35% tax rate. |
Year ended December 31, | ||||||||||||||||||||||||
2017 | 2016 | 2015 | ||||||||||||||||||||||
Average Balance | Revenue / Expense | Yield / Rate | Average Balance | Revenue / Expense | Yield / Rate | Average Balance | Revenue / Expense | Yield / Rate | ||||||||||||||||
Assets | ||||||||||||||||||||||||
Securities—taxable | $ | 51,751 | $ | 1,064 | 2.06 | % | $ | 26,619 | $ | 943 | 3.54 | % | $ | 33,616 | $ | 1,197 | 3.56 | % | ||||||
Securities—non-taxable(2) | 55 | 3 | 4.85 | % | 604 | 36 | 5.92 | % | 1,544 | 87 | 5.63 | % | ||||||||||||
Federal funds sold and securities purchased under resale agreements | 237,371 | 2,542 | 1.07 | % | 310,128 | 1,547 | 0.50 | % | 269,610 | 682 | 0.25 | % | ||||||||||||
Deposits in other banks | 2,715,669 | 29,399 | 1.08 | % | 3,133,196 | 16,312 | 0.52 | % | 2,438,742 | 6,293 | 0.26 | % | ||||||||||||
Loans held for sale | 1,016,144 | 39,159 | 3.85 | % | 416,325 | 14,009 | 3.36 | % | 6,359 | 243 | 3.82 | % | ||||||||||||
Loans held for investment, mortgage finance | 4,136,653 | 143,275 | 3.46 | % | 4,292,942 | 134,747 | 3.14 | % | 3,992,548 | 119,677 | 3.00 | % | ||||||||||||
Loans held for investment(1)(2) | 14,040,965 | 670,265 | 4.77 | % | 12,371,634 | 536,031 | 4.33 | % | 11,113,520 | 474,809 | 4.27 | % | ||||||||||||
Less reserve for loan losses | 174,105 | — | — | 163,623 | — | — | 114,965 | — | — | |||||||||||||||
Loans held for investment, net | 18,003,513 | 813,540 | 4.52 | % | 16,500,953 | 670,778 | 4.07 | % | 14,991,103 | 594,486 | 3.97 | % | ||||||||||||
Total earning assets | 22,024,503 | 885,707 | 4.02 | % | 20,387,825 | 703,625 | 3.45 | % | 17,740,974 | 602,988 | 3.40 | % | ||||||||||||
Cash and other assets | 680,345 | 558,900 | 480,616 | |||||||||||||||||||||
Total assets | $ | 22,704,848 | $ | 20,946,725 | $ | 18,221,590 | ||||||||||||||||||
Liabilities and stockholders’ equity | ||||||||||||||||||||||||
Transaction deposits | $ | 2,159,375 | $ | 15,290 | 0.71 | % | $ | 2,199,292 | $ | 7,219 | 0.33 | % | $ | 1,680,220 | $ | 2,615 | 0.16 | % | ||||||
Savings deposits | 7,495,318 | 61,230 | 0.82 | % | 6,403,306 | 27,028 | 0.42 | % | 5,920,046 | 18,738 | 0.32 | % | ||||||||||||
Time deposits | 478,513 | 3,366 | 0.70 | % | 493,128 | 2,928 | 0.59 | % | 510,378 | 2,634 | 0.52 | % | ||||||||||||
Deposits in foreign branches | — | — | — | % | — | — | — | % | 181,657 | 591 | 0.33 | % | ||||||||||||
Total interest-bearing deposits | 10,133,206 | 79,886 | 0.79 | % | 9,095,726 | 37,175 | 0.41 | % | 8,292,301 | 24,578 | 0.30 | % | ||||||||||||
Other borrowings | 1,618,238 | 17,729 | 1.10 | % | 1,480,302 | 6,645 | 0.45 | % | 1,382,013 | 2,535 | 0.18 | % | ||||||||||||
Subordinated notes | 281,213 | 16,764 | 5.96 | % | 280,850 | 16,764 | 5.97 | % | 280,487 | 16,764 | 5.98 | % | ||||||||||||
Trust preferred subordinated debentures | 113,406 | 3,592 | 3.17 | % | 113,406 | 3,009 | 2.65 | % | 113,406 | 2,551 | 2.25 | % | ||||||||||||
Total interest-bearing liabilities | 12,146,063 | 117,971 | 0.97 | % | 10,970,284 | 63,593 | 0.58 | % | 10,068,207 | 46,428 | 0.46 | % | ||||||||||||
Demand deposits | 8,320,650 | 8,124,174 | 6,447,147 | |||||||||||||||||||||
Other liabilities | 118,944 | 134,678 | 155,960 | |||||||||||||||||||||
Stockholders’ equity | 2,119,191 | 1,717,589 | 1,550,276 | |||||||||||||||||||||
Total liabilities and stockholders’ equity | $ | 22,704,848 | $ | 20,946,725 | $ | 18,221,590 | ||||||||||||||||||
Net interest income(2) | $ | 767,736 | $ | 640,032 | $ | 556,560 | ||||||||||||||||||
Net interest margin | 3.49 | % | 3.14 | % | 3.14 | % | ||||||||||||||||||
Net interest spread | 3.05 | % | 2.87 | % | 2.94 | % | ||||||||||||||||||
Loan spread(3) | 4.00 | % | 3.81 | % | 3.80 | % |
(1) | The loan averages include non-accrual loans which are stated net of unearned income. Loan interest income includes loan fees totaling $66.9 million, $56.5 million and $55.8 million for the years ended December 31, 2017, 2016 and 2015, respectively. |
(2) | Taxable equivalent rates used where applicable assuming a 35% tax rate. |
(3) | Yield on loans, net of reserves, less funding cost including all deposits and borrowed funds. |
Year ended December 31, | |||||||||||
2017 | 2016 | 2015 | |||||||||
(in thousands) | |||||||||||
Service charges on deposit accounts | $ | 12,432 | $ | 10,341 | $ | 8,323 | |||||
Wealth management and trust fee income | 6,153 | 4,268 | 5,022 | ||||||||
Bank owned life insurance (BOLI) income | 2,260 | 2,073 | 2,011 | ||||||||
Brokered loan fees | 23,331 | 25,339 | 18,661 | ||||||||
Servicing income | 15,657 | 1,715 | (12 | ) | |||||||
Swap fees | 3,990 | 2,866 | 4,275 | ||||||||
Other(1) | 10,433 | 14,178 | 9,458 | ||||||||
Total non-interest income | $ | 74,256 | $ | 60,780 | $ | 47,738 |
(1) | Other non-interest income includes such items as letter of credit fees, gain on sale of loans held for sale and other general operating income, none of which account for 1% or more of total interest income and non-interest income. |
Year ended December 31, | ||||||||||||
2017 | 2016 | 2015 | ||||||||||
(in thousands) | ||||||||||||
Salaries and employee benefits | $ | 264,231 | $ | 228,985 | $ | 192,610 | ||||||
Net occupancy expense | 25,811 | 23,221 | 23,182 | |||||||||
Marketing | 26,787 | 17,303 | 16,491 | |||||||||
Legal and professional | 29,731 | 23,326 | 22,150 | |||||||||
Communications and technology | 31,004 | 25,562 | 21,425 | |||||||||
FDIC insurance assessment | 23,510 | 24,440 | 17,231 | |||||||||
Servicing related expenses | 15,506 | 1,703 | 14 | |||||||||
Allowance and other carrying costs for OREO | 6,437 | 824 | 22 | |||||||||
Other(1) | 42,859 | 37,033 | 33,398 | |||||||||
Total non-interest expense | $ | 465,876 | $ | 382,397 | $ | 326,523 |
(1) | Other expense includes such items as courier expenses, regulatory assessments other than FDIC insurance, due from bank charges and other general operating expenses, none of which account for 1% or more of total interest income and non-interest income. |
December 31, | |||||||||||||||||||
2017 | 2016 | 2015 | 2014 | 2013 | |||||||||||||||
Commercial | $ | 9,189,811 | $ | 7,291,545 | $ | 6,672,631 | $ | 5,869,219 | $ | 5,020,565 | |||||||||
Mortgage finance | 5,308,160 | 4,497,338 | 4,966,276 | 4,102,125 | 2,784,265 | ||||||||||||||
Construction | 2,166,208 | 2,098,706 | 1,851,717 | 1,416,405 | 1,262,905 | ||||||||||||||
Real estate | 3,794,577 | 3,462,203 | 3,139,197 | 2,807,127 | 2,146,522 | ||||||||||||||
Consumer | 48,684 | 34,587 | 25,323 | 19,699 | 15,350 | ||||||||||||||
Equipment leases | 264,903 | 185,529 | 113,996 | 99,495 | 93,160 | ||||||||||||||
Total loans held for investment | $ | 20,772,343 | $ | 17,569,908 | $ | 16,769,140 | $ | 14,314,070 | $ | 11,322,767 |
(in thousands except percentage data) | Amount | Percent of Total Loans Held for Investment | ||||
Mortgage finance loans | 5,308,160 | 25.6 | % | |||
Real estate and construction | 5,012,727 | 24.1 | % | |||
Financials excluding banks | 4,193,356 | 20.2 | % | |||
Oil & gas and pipelines | 1,260,158 | 6.1 | % | |||
Healthcare and pharmaceuticals | 753,667 | 3.6 | % | |||
Retail | 456,414 | 2.2 | % | |||
Machinery, equipment and parts manufacturing | 458,528 | 2.2 | % | |||
Technology, telecom and media | 394,104 | 1.9 | % | |||
Government and education | 676,446 | 3.3 | % | |||
Commercial services | 368,135 | 1.8 | % | |||
Materials and commodities | 262,914 | 1.3 | % | |||
Consumer services | 232,927 | 1.1 | % | |||
Transportation services | 129,444 | 0.6 | % | |||
Entertainment and recreation | 234,364 | 1.1 | % | |||
Food and beverage manufacturing and wholesale | 123,427 | 0.6 | % | |||
Auto-related | 129,704 | 0.6 | % | |||
Diversified or miscellaneous | 777,868 | 3.7 | % | |||
Total loans held for investment | $ | 20,772,343 | 100.0 | % |
Amount | Percent of Total Loans | |||||
Collateral type: | ||||||
Business assets | $ | 6,360,634 | 30.6 | % | ||
Real property | 5,960,785 | 28.7 | % | |||
Mortgage finance loans | 5,308,160 | 25.6 | % | |||
Energy | 920,346 | 4.4 | % | |||
Municipal tax- and revenue-secured | 715,589 | 3.4 | % | |||
Unsecured | 649,472 | 3.1 | % | |||
Highly liquid assets | 492,527 | 2.4 | % | |||
Other assets | 302,041 | 1.5 | % | |||
Rolling stock | 51,712 | 0.2 | % | |||
U. S. Government guaranty | 11,077 | 0.1 | % | |||
Total loans held for investment | $ | 20,772,343 | 100.0 | % |
Amount | Percent of Total Real Estate Loans | |||||
Property type: | ||||||
Market risk | ||||||
1-4 Family dwellings (other than condominium) | $ | 886,760 | 14.9 | % | ||
Commercial buildings | 779,294 | 13.1 | % | |||
Hospital/medical buildings | 589,162 | 9.9 | % | |||
Apartment buildings | 502,037 | 8.4 | % | |||
Hotel/motel buildings | 421,117 | 7.1 | % | |||
Industrial buildings | 410,091 | 6.9 | % | |||
Residential lots | 372,045 | 6.2 | % | |||
Shopping center/mall buildings | 341,694 | 5.7 | % | |||
Commercial lots | 92,255 | 1.5 | % | |||
Unimproved land | 72,590 | 1.2 | % | |||
Other | 315,186 | 5.3 | % | |||
Other than market risk | ||||||
Commercial buildings | 343,591 | 5.8 | % | |||
1-4 Family dwellings (other than condominium) | 314,698 | 5.3 | % | |||
Industrial buildings | 227,206 | 3.8 | % | |||
Other | 293,059 | 4.9 | % | |||
Total real estate loans | $ | 5,960,785 | 100.0 | % |
Amount | Percent of Total | |||||
Geographic region: | ||||||
Dallas/Fort Worth | $ | 1,200,812 | 25.1 | % | ||
Houston | 1,122,349 | 23.5 | % | |||
San Antonio | 537,764 | 11.2 | % | |||
Austin | 514,247 | 10.8 | % | |||
Other Texas cities | 173,107 | 3.6 | % | |||
Other states | 1,233,952 | 25.8 | % | |||
Total market risk real estate loans | $ | 4,782,231 | 100.0 | % |
December 31, 2017 | December 31, 2016 | ||||||||||||||||||||
Period End Balances | Period End Balances | ||||||||||||||||||||
Number of Relationships | Committed | Outstanding | Number of Relationships | Committed | Outstanding | ||||||||||||||||
$30.0 million and greater | 109 | $ | 4,817,219 | $ | 2,610,872 | 65 | $ | 2,783,291 | $ | 1,454,065 | |||||||||||
$20.0 million to $29.9 million | 206 | 4,802,310 | 2,957,223 | 187 | 4,389,200 | 2,790,393 |
2017 Average Balance | 2016 Average Balance | ||||||||||||||
Committed | Outstanding | Committed | Outstanding | ||||||||||||
$30.0 million and greater | $ | 44,195 | $ | 23,953 | $ | 42,820 | $ | 22,370 | |||||||
$20.0 million to $29.9 million | 23,312 | 14,355 | 23,472 | 14,921 |
Remaining Maturities of Selected Loans | |||||||||||||||
(in thousands) | Total | Within 1 Year | 1-5 Years | After 5 Years | |||||||||||
Loan maturity: | |||||||||||||||
Commercial | $ | 9,189,811 | $ | 3,801,267 | $ | 4,566,771 | $ | 821,773 | |||||||
Mortgage finance | 5,308,160 | 5,308,160 | — | — | |||||||||||
Construction | 2,166,208 | 677,722 | 1,423,761 | 64,725 | |||||||||||
Real estate | 3,794,577 | 806,527 | 2,127,767 | 860,283 | |||||||||||
Consumer | 48,684 | 33,989 | 4,588 | 10,107 | |||||||||||
Equipment leases | 264,903 | 11,240 | 93,006 | 160,657 | |||||||||||
Total loans held for investment | $ | 20,772,343 | $ | 10,638,905 | $ | 8,215,893 | $ | 1,917,545 | |||||||
Interest rate sensitivity for selected loans with: | |||||||||||||||
Predetermined interest rates | $ | 3,025,345 | $ | 1,438,322 | $ | 592,476 | $ | 994,547 | |||||||
Floating or adjustable interest rates | 17,746,998 | 9,200,583 | 7,623,417 | 922,998 | |||||||||||
Total loans held for investment | $ | 20,772,343 | $ | 10,638,905 | $ | 8,215,893 | $ | 1,917,545 |
As of December 31, | |||||||||||
2017 | 2016 | 2015 | |||||||||
Non-accrual loans(1)(2) | |||||||||||
Commercial | |||||||||||
Oil and gas properties | $ | 64,192 | $ | 115,599 | $ | 104,179 | |||||
Assets of the borrowers | 7,571 | 18,592 | 30,360 | ||||||||
Inventory | 24,399 | 27,630 | 2,099 | ||||||||
Other | 3,569 | 3,119 | 2,020 | ||||||||
Total commercial | 99,731 | 164,940 | 138,658 | ||||||||
Construction | |||||||||||
Commercial building | — | — | 16,667 | ||||||||
Other | — | 159 | — | ||||||||
Total construction | — | 159 | 16,667 | ||||||||
Real estate | |||||||||||
Commercial property | 1,096 | 2,083 | 2,867 | ||||||||
Unimproved land and/or developed residential lots | — | — | 3,576 | ||||||||
Farm land | — | 326 | 12,486 | ||||||||
Other | 617 | — | 383 | ||||||||
Total real estate | 1,713 | 2,409 | 19,312 | ||||||||
Consumer | — | 200 | — | ||||||||
Equipment leases | — | 83 | 5,151 | ||||||||
Total non-accrual loans | 101,444 | 167,791 | 179,788 | ||||||||
Repossessed assets: | |||||||||||
OREO(3) | 11,742 | 18,961 | 278 | ||||||||
Other repossessed assets | — | — | 230 | ||||||||
Total other repossessed assets | 11,742 | 18,961 | 508 | ||||||||
Total non-performing assets | $ | 113,186 | $ | 186,752 | $ | 180,296 | |||||
Restructured loans - accruing | $ | — | $ | — | $ | 249 | |||||
Loans past due 90 days and accruing(4)(5) | $ | 28,166 | $ | 10,729 | $ | 7,013 |
(1) | If these loans had been current throughout their terms, interest and fees on loans would have increased by approximately $19.0 million, $7.9 million and $7.0 million for the years ended December 31, 2017, 2016 and 2015, respectively. |
(2) | As of December 31, 2017, 2016 and 2015, non-accrual loans included $18.8 million, $18.1 million and $24.9 million, respectively, in loans that met the criteria for restructured. |
(3) | At December 31, 2017, 2016 and 2015, there was no valuation allowance recorded against the OREO balance; however, we recorded a $6.1 million write-down on one asset during 2017. For additional information on OREO, see Note 4 - OREO and Valuation Allowance for Losses on OREO in the accompanying notes to the consolidated financial statements included elsewhere in this report. |
(4) | At December 31, 2017, 2016 and 2015, loans past due 90 days and still accruing includes premium finance loans of $5.5 million, $6.8 million and $6.6 million, respectively. |
(5) | At December 31, 2017, loans past due 90 days and still accruing includes $19.7 million in loans held for sale, of which $19.0 million are loans with government guarantees that we purchased and sold into securitized Ginnie Mae pools. Pursuant to Ginnie Mae servicing guidelines we have the unilateral right, but not the obligation, to repurchase these loans if they meet defined delinquent loan criteria and therefore must record any delinquent loans as held for sale on our balance sheet regardless of whether the repurchase option has been exercised. |
Year Ended December 31, | ||||||||||||||||||||
2017 | 2016 | 2015 | 2014 | 2013 | ||||||||||||||||
Allowance for loan losses: | ||||||||||||||||||||
Beginning balance | $ | 168,126 | $ | 141,111 | $ | 100,954 | $ | 87,604 | $ | 74,337 | ||||||||||
Loans charged-off: | ||||||||||||||||||||
Commercial | 34,145 | 56,558 | 16,254 | 9,803 | 6,575 | |||||||||||||||
Construction | 59 | — | — | — | — | |||||||||||||||
Real estate | 290 | 528 | 389 | 296 | 144 | |||||||||||||||
Consumer | 180 | 47 | 62 | 266 | 45 | |||||||||||||||
Equipment leases | — | — | 25 | — | 2 | |||||||||||||||
Total charge-offs | 34,674 | 57,133 | 16,730 | 10,365 | 6,766 | |||||||||||||||
Recoveries: | ||||||||||||||||||||
Commercial | 4,593 | 9,364 | 4,944 | 2,762 | 1,203 | |||||||||||||||
Construction | 104 | 34 | 400 | — | — | |||||||||||||||
Real estate | 75 | 63 | 33 | 79 | 270 | |||||||||||||||
Consumer | 70 | 21 | 173 | 162 | 73 | |||||||||||||||
Equipment leases | 10 | 77 | 38 | 1,082 | 322 | |||||||||||||||
Total recoveries | 4,852 | 9,559 | 5,588 | 4,085 | 1,868 | |||||||||||||||
Net charge-offs | 29,822 | 47,574 | 11,142 | 6,280 | 4,898 | |||||||||||||||
Provision for loan losses | 46,351 | 74,589 | 51,299 | 19,630 | 18,165 | |||||||||||||||
Ending balance | $ | 184,655 | $ | 168,126 | $ | 141,111 | $ | 100,954 | $ | 87,604 | ||||||||||
Allowance for off-balance sheet credit losses: | ||||||||||||||||||||
Beginning balance | $ | 11,422 | $ | 9,011 | $ | 7,060 | $ | 4,690 | $ | 3,855 | ||||||||||
Provision for off-balance sheet credit losses | (2,351 | ) | 2,411 | 1,951 | 2,370 | 835 | ||||||||||||||
Ending balance | $ | 9,071 | $ | 11,422 | $ | 9,011 | $ | 7,060 | $ | 4,690 | ||||||||||
Total allowance for credit losses | $ | 193,726 | $ | 179,548 | $ | 150,122 | $ | 108,014 | $ | 92,294 | ||||||||||
Total provision for credit losses | $ | 44,000 | $ | 77,000 | $ | 53,250 | $ | 22,000 | $ | 19,000 | ||||||||||
Allowance for loan losses to LHI | 0.89 | % | 0.96 | % | 0.84 | % | 0.71 | % | 0.78 | % | ||||||||||
Allowance for loan losses to LHI excluding mortgage finance loans | 1.20 | % | 1.29 | % | 1.20 | % | 0.99 | % | 1.03 | % | ||||||||||
Net charge-offs to average LHI | 0.16 | % | 0.29 | % | 0.07 | % | 0.05 | % | 0.05 | % | ||||||||||
Net charge-offs to average LHI excluding mortgage finance loans | 0.21 | % | 0.38 | % | 0.10 | % | 0.07 | % | 0.07 | % | ||||||||||
Total provision for credit losses to average LHI | 0.24 | % | 0.46 | % | 0.35 | % | 0.18 | % | 0.19 | % | ||||||||||
Total provision for credit losses to average LHI excluding mortgage finance loans | 0.31 | % | 0.62 | % | 0.48 | % | 0.24 | % | 0.25 | % | ||||||||||
Recoveries to total charge-offs | 13.99 | % | 16.73 | % | 33.40 | % | 39.41 | % | 27.61 | % | ||||||||||
Allowance for off-balance sheet credit losses to off-balance sheet credit commitments | 0.13 | % | 0.19 | % | 0.16 | % | 0.13 | % | 0.12 | % | ||||||||||
Combined allowance for credit losses to LHI | 0.94 | % | 1.03 | % | 0.90 | % | 0.76 | % | 0.82 | % | ||||||||||
Combined allowance for credit losses to LHI excluding mortgage finance loans | 1.26 | % | 1.38 | % | 1.28 | % | 1.06 | % | 1.09 | % | ||||||||||
Allowance as a multiple of non-performing loans | 1.8 | x | 1.0 | x | 0.8 | x | 2.3 | x | 2.7 | x |
December 31, | |||||||||||||||||||||||||||||||||||
2017 | 2016 | 2015 | 2014 | 2013 | |||||||||||||||||||||||||||||||
(in thousands except percentage data) | Reserve | % of Loans | Reserve | % of Loans | Reserve | % of Loans | Reserve | % of Loans | Reserve | % of Loans | |||||||||||||||||||||||||
Loan category: | |||||||||||||||||||||||||||||||||||
Commercial | $ | 118,806 | 45 | % | $ | 128,768 | 41 | % | $ | 112,446 | 40 | % | $ | 70,654 | 41 | % | $ | 39,868 | 44 | % | |||||||||||||||
Mortgage finance loans(1) | — | 26 | % | — | 26 | % | — | 29 | % | — | 28 | % | — | 25 | % | ||||||||||||||||||||
Construction | 19,273 | 10 | % | 13,144 | 12 | % | 6,836 | 11 | % | 7,935 | 10 | % | 14,553 | 11 | % | ||||||||||||||||||||
Real estate | 34,287 | 18 | % | 19,149 | 20 | % | 13,381 | 19 | % | 15,582 | 20 | % | 24,210 | 19 | % | ||||||||||||||||||||
Consumer | 357 | — | 241 | — | 338 | — | 240 | — | 149 | — | |||||||||||||||||||||||||
Equipment leases | 3,542 | 1 | % | 1,124 | 1 | % | 3,931 | 1 | % | 1,141 | 1 | % | 3,105 | 1 | % | ||||||||||||||||||||
Additional qualitative reserve | 8,390 | — | 5,700 | — | 4,179 | — | 5,402 | — | 5,719 | — | |||||||||||||||||||||||||
Total loans held for investment | $ | 184,655 | 100 | % | $ | 168,126 | 100 | % | $ | 141,111 | 100 | % | $ | 100,954 | 100 | % | $ | 87,604 | 100 | % |
(1) | No amount of the allowance is allocated to these loans based on their risk profile. |
Average Balances | |||||||||||
2017 | 2016 | 2015 | |||||||||
Non-interest-bearing | $ | 8,320,650 | $ | 8,124,174 | $ | 6,447,147 | |||||
Interest-bearing transaction | 2,159,375 | 2,199,292 | 1,680,220 | ||||||||
Savings | 7,495,318 | 6,403,306 | 5,920,046 | ||||||||
Time deposits | 478,513 | 493,128 | 510,378 | ||||||||
Deposits in foreign branches | — | — | 181,657 | ||||||||
Total average deposits | $ | 18,453,856 | $ | 17,219,900 | $ | 14,739,448 |
December 31, | |||||||||||
(In thousands) | 2017 | 2016 | 2015 | ||||||||
Months to maturity: | |||||||||||
3 or less | $ | 161,523 | $ | 160,495 | $ | 240,291 | |||||
Over 3 through 6 | 146,027 | 95,482 | 100,582 | ||||||||
Over 6 through 12 | 128,817 | 97,761 | 89,860 | ||||||||
Over 12 | 28,965 | 17,118 | 15,714 | ||||||||
Total | $ | 465,332 | $ | 370,856 | $ | 446,447 |
December 31, | ||||||||||||
2017 | 2016 | 2015 | ||||||||||
Federal funds sold and securities purchased under resale agreements | $ | 30,000 | $ | 25,000 | $ | 55,000 | ||||||
Interest-bearing deposits | 2,697,581 | 2,700,645 | 1,626,374 | |||||||||
Total liquidity assets | $ | 2,727,581 | $ | 2,725,645 | $ | 1,681,374 | ||||||
Total liquidity assets as a percent of: | ||||||||||||
Total loans held for investment, excluding mortgage finance loans | 17.8 | % | 21.0 | % | 14.3 | % | ||||||
Total loans held for investment | 13.2 | % | 15.6 | % | 10.1 | % | ||||||
Total earning assets | 11.2 | % | 12.9 | % | 9.2 | % | ||||||
Total deposits | 14.3 | % | 16.0 | % | 11.1 | % |
December 31, | |||||||
2017 | 2016 | ||||||
Deposits from core customers | $ | 17,100.8 | $ | 15,400.5 | |||
Deposits from core customers as a percent of total deposits | 89.4 | % | 90.5 | % | |||
Relationship brokered deposits | $ | 2,022.4 | $ | 1,616.3 | |||
Relationship brokered deposits as a percent of average total deposits | 10.6 | % | 9.5 | % | |||
Traditional brokered deposits | $ | — | $ | — | |||
Traditional brokered deposits as a percent of total deposits | — | % | — | % | |||
Average deposits from core customers | $ | 16,806.9 | $ | 15,723.8 | |||
Average deposits from core customers as a percent of average total deposits | 91.1 | % | 91.3 | % | |||
Average relationship brokered deposits | $ | 1,647.0 | $ | 1,496.1 | |||
Average relationship brokered deposits as a percent of average total deposits | 8.9 | % | 8.7 | % | |||
Average traditional brokered deposits | $ | — | $ | — | |||
Average traditional brokered deposits as a percent of average total deposits | — | % | — | % |
December 31, | ||||||||||||||||||||||||||||||||
2017 | 2016 | 2015 | ||||||||||||||||||||||||||||||
Balance | Rate(3) | Maximum Outstanding at Any Month End | Balance | Rate(3) | Maximum Outstanding at Any Month End | Balance | Rate(3) | Maximum Outstanding at Any Month End | ||||||||||||||||||||||||
Federal funds purchased(4) | $ | 359,338 | 1.45 | % | $ | 101,800 | 0.80 | % | $ | 74,164 | 0.55 | % | ||||||||||||||||||||
Customer repurchase agreements(1) | 5,702 | 0.03 | % | 7,775 | 0.05 | % | 68,887 | 0.02 | % | |||||||||||||||||||||||
FHLB borrowings(2) | 2,800,000 | 1.35 | % | 2,000,000 | 0.61 | % | 1,500,000 | 0.31 | % | |||||||||||||||||||||||
Total borrowings | $ | 3,165,040 | $ | 3,165,040 | $ | 2,109,575 | $ | 2,117,280 | $ | 1,643,051 | $ | 1,643,051 |
(1) | Securities pledged for customer repurchase agreements were $7.3 million, $10.2 million and $14.2 million at December 31, 2017, 2016 and 2015, respectively. |
(2) | FHLB borrowings are collateralized by a blanket floating lien on certain real estate secured loans, mortgage finance assets and also certain pledged securities. The weighted-average interest rate for the years ended December 31, 2017, 2016 and 2015 was 1.08%, 0.43% and 0.18%, respectively. The average balance of FHLB borrowings for the years ended December 31, 2017, 2016 and 2015 was $1.4 billion, $1.4 billion and $1.2 billion, respectively. |
(3) | Interest rate as of period end. |
(4) | The weighted-average interest rate on Federal funds purchased for the years ended December 31, 2017, 2016 and 2015 was 1.20%, 0.57% and 0.29%, respectively. The average balance of Federal funds purchased for the years ended December 31, 2017, 2016 and 2015 was $215.9 million, $90.9 million and $98.8 million, respectively. |
December 31, | |||||||||||
2017 | 2016 | 2015 | |||||||||
FHLB borrowing capacity relating to loans | $ | 3,890,995 | $ | 3,057,915 | $ | 4,101,396 | |||||
FHLB borrowing capacity relating to securities | 2,071 | 1,653 | 1,213 | ||||||||
Total FHLB borrowing capacity | $ | 3,893,066 | $ | 3,059,568 | $ | 4,102,609 | |||||
Unused Federal funds lines available from commercial banks | $ | 885,000 | $ | 1,118,000 | $ | 1,231,000 | |||||
Unused Federal Reserve Borrowings capacity | $ | 4,114,594 | $ | 3,179,087 | $ | 2,966,702 |
(In thousands) | Note Reference | Within One Year | After One But Within Three Years | After Three But Within Five Years | After Five Years | Total | ||||||||||||||||
Deposits without a stated maturity | 8 | $ | 18,593,927 | $ | — | $ | — | $ | — | $ | 18,593,927 | |||||||||||
Time deposits | 8 | 492,208 | 36,106 | 490 | 449 | 529,253 | ||||||||||||||||
Federal funds purchased and customer repurchase agreements | 9 | 365,040 | — | — | — | 365,040 | ||||||||||||||||
FHLB borrowings | 9 | 2,800,000 | — | — | — | 2,800,000 | ||||||||||||||||
Operating lease obligations(1) | 17 | 16,446 | 31,423 | 24,943 | 17,299 | 90,111 | ||||||||||||||||
Subordinated notes | 9 | — | — | — | 281,406 | 281,406 | ||||||||||||||||
Trust preferred subordinated debentures | 9, 10 | — | — | — | 113,406 | 113,406 | ||||||||||||||||
Total contractual obligations | $ | 22,267,621 | $ | 67,529 | $ | 25,433 | $ | 412,560 | $ | 22,773,143 |
(1) | Non-balance sheet item. |
Within One Year | After One But Within Three Years | After Three But Within Five Years | After Five Years | Total | |||||||||||||||
Commitments to extend credit | $ | 2,180,367 | $ | 2,893,064 | $ | 1,721,078 | $ | 163,338 | $ | 6,957,847 | |||||||||
Standby and commercial letters of credit | 191,896 | 37,898 | 1,164 | — | 230,958 | ||||||||||||||
Total financial instruments with off-balance sheet risk | $ | 2,372,263 | $ | 2,930,962 | $ | 1,722,242 | $ | 163,338 | $ | 7,188,805 |
ITEM 7A. | QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK |
(in thousands) | 0-3 mo Balance | 4-12 mo Balance | 1-3 yr Balance | 3+ yr Balance | Total Balance | ||||||||||||||
Assets: | |||||||||||||||||||
Interest-bearing deposits, federal funds sold and securities purchased under resale agreements | $ | 2,727,581 | $ | — | $ | — | $ | — | $ | 2,727,581 | |||||||||
Securities(1) | 8,397 | 917 | 922 | 13,275 | 23,511 | ||||||||||||||
Total variable loans | 18,222,718 | 97,919 | 13,492 | 1,749 | 18,335,878 | ||||||||||||||
Total fixed loans | 534,566 | 1,385,340 | 433,619 | 1,093,944 | 3,447,469 | ||||||||||||||
Total loans(2) | 18,757,284 | 1,483,259 | 447,111 | 1,095,693 | 21,783,347 | ||||||||||||||
Total interest sensitive assets | $ | 21,493,262 | $ | 1,484,176 | $ | 448,033 | $ | 1,108,968 | $ | 24,534,439 | |||||||||
Liabilities | |||||||||||||||||||
Interest-bearing customer deposits | $ | 10,781,267 | $ | — | $ | — | $ | — | $ | 10,781,267 | |||||||||
CDs & IRAs | 180,612 | 311,596 | 36,106 | 939 | 529,253 | ||||||||||||||
Total interest-bearing deposits | 10,961,879 | 311,596 | 36,106 | 939 | 11,310,520 | ||||||||||||||
Repurchase agreements, Federal funds purchased, FHLB borrowings | 3,165,040 | — | — | — | 3,165,040 | ||||||||||||||
Subordinated notes | — | — | — | 281,406 | 281,406 | ||||||||||||||
Trust preferred subordinated debentures | — | — | — | 113,406 | 113,406 | ||||||||||||||
Total borrowings | 3,165,040 | — | — | 394,812 | 3,559,852 | ||||||||||||||
Total interest sensitive liabilities | $ | 14,126,919 | $ | 311,596 | $ | 36,106 | $ | 395,751 | $ | 14,870,372 | |||||||||
GAP | $ | 7,366,343 | $ | 1,172,580 | $ | 411,927 | $ | 713,217 | $ | — | |||||||||
Cumulative GAP | 7,366,343 | 8,538,923 | 8,950,850 | 9,664,067 | 9,664,067 | ||||||||||||||
Demand deposits | $ | 7,812,660 | |||||||||||||||||
Stockholders’ equity | 2,202,721 | ||||||||||||||||||
Total | $ | 10,015,381 |
(1) | Securities based on fair market value. |
(2) | Loans are stated at gross. |
Anticipated Impact Over the Next Twelve Months as Compared to Most Likely Scenario | |||||||||||||||
December 31, 2017 | December 31, 2016 | ||||||||||||||
100 bps Increase | 200 bps Increase | 100 bps Increase | 200 bps Increase | ||||||||||||
Change in net interest income | $ | 112,970 | $ | 226,855 | $ | 124,583 | $ | 254,308 |
ITEM 8. | FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA |
Page Reference | |
December 31, | |||||||
(in thousands except per share data) | 2017 | 2016 | |||||
Assets | |||||||
Cash and due from banks | $ | 178,010 | $ | 113,707 | |||
Interest-bearing deposits | 2,697,581 | 2,700,645 | |||||
Federal funds sold and securities purchased under resale agreements | 30,000 | 25,000 | |||||
Securities, available-for-sale | 23,511 | 24,874 | |||||
Loans held for sale ($1,007.7 million and $968.9 million at December 2017 and 2016, respectively, at fair value) | 1,011,004 | 968,929 | |||||
Loans held for investment, mortgage finance | 5,308,160 | 4,497,338 | |||||
Loans held for investment (net of unearned income) | 15,366,252 | 13,001,011 | |||||
Less: Allowance for loan losses | 184,655 | 168,126 | |||||
Loans held for investment, net | 20,489,757 | 17,330,223 | |||||
Mortgage servicing rights, net | 85,327 | 28,536 | |||||
Premises and equipment, net | 25,176 | 19,775 | |||||
Accrued interest receivable and other assets | 516,239 | 465,933 | |||||
Goodwill and intangible assets, net | 19,040 | 19,512 | |||||
Total assets | $ | 25,075,645 | $ | 21,697,134 | |||
Liabilities and Stockholders’ Equity | |||||||
Liabilities: | |||||||
Deposits: | |||||||
Non-interest-bearing | $ | 7,812,660 | $ | 7,994,201 | |||
Interest-bearing | 11,310,520 | 9,022,630 | |||||
Total deposits | 19,123,180 | 17,016,831 | |||||
Accrued interest payable | 7,680 | 5,498 | |||||
Other liabilities | 182,212 | 161,223 | |||||
Federal funds purchased and repurchase agreements | 365,040 | 109,575 | |||||
Other borrowings | 2,800,000 | 2,000,000 | |||||
Subordinated notes, net | 281,406 | 281,044 | |||||
Trust preferred subordinated debentures | 113,406 | 113,406 | |||||
Total liabilities | 22,872,924 | 19,687,577 | |||||
Stockholders’ equity: | |||||||
Preferred stock, $.01 par value, $1,000 liquidation value: | |||||||
Authorized shares—10,000,000 | |||||||
Issued shares—6,000,000 shares issued at December 31, 2017 and 2016 | 150,000 | 150,000 | |||||
Common stock, $.01 par value: | |||||||
Authorized shares—100,000,000 | |||||||
Issued shares—49,643,761 and 49,504,079 at December 31, 2017 and 2016, respectively | 496 | 495 | |||||
Additional paid-in capital | 961,305 | 955,468 | |||||
Retained earnings | 1,090,500 | 903,187 | |||||
Treasury stock (shares at cost: 417 at December 31, 2017 and 2016) | (8 | ) | (8 | ) | |||
Accumulated other comprehensive income, net of taxes | 428 | 415 | |||||
Total stockholders’ equity | 2,202,721 | 2,009,557 | |||||
Total liabilities and stockholders’ equity | $ | 25,075,645 | $ | 21,697,134 |
Year ended December 31, | |||||||||||
(In thousands except per share data) | 2017 | 2016 | 2015 | ||||||||
Interest income | |||||||||||
Interest and fees on loans | $ | 846,292 | $ | 684,582 | $ | 594,729 | |||||
Securities | 1,066 | 967 | 1,254 | ||||||||
Federal funds sold and securities purchased under resale agreements | 2,542 | 1,547 | 682 | ||||||||
Deposits in other banks | 29,399 | 16,312 | 6,293 | ||||||||
Total interest income | 879,299 | 703,408 | 602,958 | ||||||||
Interest expense | |||||||||||
Deposits | 79,886 | 37,175 | 24,578 | ||||||||
Federal funds purchased | 2,592 | 518 | 284 | ||||||||
Other borrowings | 15,137 | 6,128 | 2,251 | ||||||||
Subordinated notes | 16,764 | 16,764 | 16,764 | ||||||||
Trust preferred subordinated debentures | 3,592 | 3,009 | 2,551 | ||||||||
Total interest expense | 117,971 | 63,594 | 46,428 | ||||||||
Net interest income | 761,328 | 639,814 | 556,530 | ||||||||
Provision for credit losses | 44,000 | 77,000 | 53,250 | ||||||||
Net interest income after provision for credit losses | 717,328 | 562,814 | 503,280 | ||||||||
Non-interest income | |||||||||||
Service charges on deposit accounts | 12,432 | 10,341 | 8,323 | ||||||||
Wealth management and trust fee income | 6,153 | 4,268 | 5,022 | ||||||||
Bank owned life insurance (BOLI) income | 2,260 | 2,073 | 2,011 | ||||||||
Brokered loan fees | 23,331 | 25,339 | 18,661 | ||||||||
Servicing income | 15,657 | 1,715 | (12 | ) | |||||||
Swap fees | 3,990 | 2,866 | 4,275 | ||||||||
Other | 10,433 | 14,178 | 9,458 | ||||||||
Total non-interest income | 74,256 | 60,780 | 47,738 | ||||||||
Non-interest expense | |||||||||||
Salaries and employee benefits | 264,231 | 228,985 | 192,610 | ||||||||
Net occupancy expense | 25,811 | 23,221 | 23,182 | ||||||||
Marketing | 26,787 | 17,303 | 16,491 | ||||||||
Legal and professional | 29,731 | 23,326 | 22,150 | ||||||||
Communications and technology | 31,004 | 25,562 | 21,425 | ||||||||
FDIC insurance assessment | 23,510 | 24,440 | 17,231 | ||||||||
Servicing related expenses | 15,506 | 1,703 | 14 | ||||||||
Allowance and other carrying costs for OREO | 6,437 | 824 | 22 | ||||||||
Other | 42,859 | 37,033 | 33,398 | ||||||||
Total non-interest expense | 465,876 | 382,397 | 326,523 | ||||||||
Income before income taxes | 325,708 | 241,197 | 224,495 | ||||||||
Income tax expense | 128,645 | 86,078 | 79,641 | ||||||||
Net income | 197,063 | 155,119 | 144,854 | ||||||||
Preferred stock dividends | 9,750 | 9,750 | 9,750 | ||||||||
Net income available to common stockholders | $ | 187,313 | $ | 145,369 | $ | 135,104 | |||||
Other comprehensive gain (loss) | |||||||||||
Change in unrealized gain on available-for-sale securities arising during period, before tax | $ | 19 | $ | (467 | ) | $ | (877 | ) | |||
Income tax expense (benefit) related to unrealized loss on available-for-sale securities | 6 | (164 | ) | (306 | ) | ||||||
Other comprehensive loss net of tax | 13 | (303 | ) | (571 | ) | ||||||
Comprehensive income | $ | 197,076 | $ | 154,816 | $ | 144,283 | |||||
Basic earnings per common share | $ | 3.78 | $ | 3.14 | $ | 2.95 | |||||
Diluted earnings per common share | $ | 3.73 | $ | 3.11 | $ | 2.91 |
Preferred Stock | Common Stock | Additional | Treasury Stock | Accumulated Other | ||||||||||||||||||||||||||||||||
Paid-in | Retained | Comprehensive | ||||||||||||||||||||||||||||||||||
(In thousands except share data) | Shares | Amount | Shares | Amount | Capital | Earnings | Shares | Amount | Income | Total | ||||||||||||||||||||||||||
Balance at December 31, 2014 | 6,000,000 | $ | 150,000 | 45,735,424 | $ | 457 | $ | 709,738 | $ | 622,714 | (417 | ) | $ | (8 | ) | $ | 1,289 | $ | 1,484,190 | |||||||||||||||||
Comprehensive income: | ||||||||||||||||||||||||||||||||||||
Net income | — | — | — | — | — | 144,854 | — | — | — | 144,854 | ||||||||||||||||||||||||||
Change in unrealized gain (loss) on available-for-sale securities, net of tax benefit of $306 | — | — | — | — | — | — | — | — | (571 | ) | (571 | ) | ||||||||||||||||||||||||
Total comprehensive income | 144,283 | |||||||||||||||||||||||||||||||||||
Tax expense related to exercise of stock-based awards | — | — | — | — | 1,452 | — | — | — | — | 1,452 | ||||||||||||||||||||||||||
Stock-based compensation expense recognized in earnings | — | — | — | — | 4,597 | — | — | — | — | 4,597 | ||||||||||||||||||||||||||
Preferred stock dividend | — | — | — | — | — | (9,750 | ) | — | — | — | (9,750 | ) | ||||||||||||||||||||||||
Issuance of stock related to stock-based awards | — | — | 138,800 | 2 | (1,241 | ) | — | — | — | — | (1,239 | ) | ||||||||||||||||||||||||
Balance at December 31, 2015 | 6,000,000 | 150,000 | 45,874,224 | 459 | 714,546 | 757,818 | (417 | ) | (8 | ) | 718 | 1,623,533 | ||||||||||||||||||||||||
Comprehensive income: | ||||||||||||||||||||||||||||||||||||
Net income | — | — | — | — | — | 155,119 | — | — | — | 155,119 | ||||||||||||||||||||||||||
Change in unrealized gain (loss) on available-for-sale securities, net of tax benefit of $164 | — | — | — | — | — | — | — | — | (303 | ) | (303 | ) | ||||||||||||||||||||||||
Total comprehensive income | 154,816 | |||||||||||||||||||||||||||||||||||
Tax expense related to exercise of stock-based awards | — | — | — | — | 1,879 | — | — | — | — | 1,879 | ||||||||||||||||||||||||||
Stock-based compensation expense recognized in earnings | — | — | — | — | 5,093 | — | — | — | — | 5,093 | ||||||||||||||||||||||||||
Preferred stock dividend | — | — | — | — | — | (9,750 | ) | — | — | — | (9,750 | ) | ||||||||||||||||||||||||
Issuance of stock related to stock-based awards | — | — | 172,459 | 1 | (2,482 | ) | — | — | — | — | (2,481 | ) | ||||||||||||||||||||||||
Issuance of common stock | — | — | 3,450,000 | 35 | 236,432 | — | — | — | — | 236,467 | ||||||||||||||||||||||||||
Issuance of stock related to warrants | — | — | 7,396 | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Balance at December 31, 2016 | 6,000,000 | 150,000 | 49,504,079 | 495 | 955,468 | 903,187 | (417 | ) | (8 | ) | 415 | 2,009,557 | ||||||||||||||||||||||||
Comprehensive income: | ||||||||||||||||||||||||||||||||||||
Net income | — | — | — | — | — | 197,063 | — | — | — | 197,063 | ||||||||||||||||||||||||||
Change in unrealized gain (loss) on available-for-sale securities, net of tax expense of $6 | — | — | — | — | — | — | — | — | 13 | 13 | ||||||||||||||||||||||||||
Total comprehensive income | 197,076 | |||||||||||||||||||||||||||||||||||
Tax expense related to exercise of stock-based awards | — | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Stock-based compensation expense recognized in earnings | — | — | — | — | 8,079 | — | — | — | — | 8,079 | ||||||||||||||||||||||||||
Preferred stock dividend | — | — | — | — | — | (9,750 | ) | — | — | — | (9,750 | ) | ||||||||||||||||||||||||
Issuance of stock related to stock-based awards | — | — | 106,087 | 1 | (2,242 | ) | — | — | — | — | (2,241 | ) | ||||||||||||||||||||||||
Issuance of common stock | — | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Issuance of stock related to warrants | — | — | 33,595 | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Balance at December 31, 2017 | 6,000,000 | $ | 150,000 | 49,643,761 | $ | 496 | $ | 961,305 | $ | 1,090,500 | (417 | ) | $ | (8 | ) | $ | 428 | $ | 2,202,721 |
Year ended December 31, | |||||||||||
(In thousands) | 2017 | 2016 | 2015 | ||||||||
Operating activities | |||||||||||
Net income | $ | 197,063 | $ | 155,119 | $ | 144,854 | |||||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||
Provision for credit losses | 44,000 | 77,000 | 53,250 | ||||||||
Deferred tax expense (benefit) | 31,276 | (2,946 | ) | (3,561 | ) | ||||||
Depreciation and amortization | 27,871 | 21,814 | 16,495 | ||||||||
Increase in valuation allowance on mortgage servicing rights | 2,823 | — | — | ||||||||
BOLI income | (2,260 | ) | (2,073 | ) | (2,011 | ) | |||||
Stock-based compensation expense | 22,019 | 13,578 | 12,304 | ||||||||
Excess tax benefits from stock-based compensation arrangements | — | (2,013 | ) | (1,499 | ) | ||||||
Purchases and originations of loans held for sale | (5,556,964 | ) | (3,327,482 | ) | (127,002 | ) | |||||
Proceeds from sales and repayments of loans held for sale | 5,457,117 | 2,405,592 | 40,490 | ||||||||
Net (gain) loss on sale of loans held for sale and other assets | 2,082 | (2,519 | ) | 179 | |||||||
Technology write-off | 5,285 | — | — | ||||||||
OREO write-down | 6,111 | — | — | ||||||||
Changes in operating assets and liabilities: | |||||||||||
Accrued interest receivable and other assets | (114,551 | ) | (59,787 | ) | (61,002 | ) | |||||
Accrued interest payable and other liabilities | 10,289 | (2,576 | ) | (3,554 | ) | ||||||
Net cash provided by (used in) operating activities | 132,161 | (726,293 | ) | 68,943 | |||||||
Investing activities | |||||||||||
Purchases of available-for-sale securities | (97,776 | ) | (1,760 | ) | — | ||||||
Maturities and calls of available-for-sale securities | 94,775 | 555 | 2,430 | ||||||||
Principal payments received on available-for-sale securities | 4,383 | 5,856 | 8,419 | ||||||||
Originations of mortgage finance loans | (86,931,566 | ) | (100,574,326 | ) | (86,342,672 | ) | |||||
Proceeds from pay-offs of mortgage finance loans | 86,120,744 | 101,043,264 | 85,478,521 | ||||||||
Net increase in loans held for investment, excluding mortgage finance loans | (2,395,063 | ) | (1,321,733 | ) | (1,603,880 | ) | |||||
Purchase of premises and equipment, net | (12,265 | ) | (2,176 | ) | (5,034 | ) | |||||
Proceeds from sale of foreclosed assets | 1,023 | 110 | 1,430 | ||||||||
Net cash used in investing activities | (3,215,745 | ) | (850,210 | ) | (2,460,786 | ) | |||||
Financing activities | |||||||||||
Net increase in deposits | 2,106,349 | 1,932,212 | 2,411,319 | ||||||||
Costs from issuance of stock related to stock-based awards and warrants | (2,241 | ) | (2,481 | ) | (1,239 | ) | |||||
Net proceeds from issuance of common stock | — | 236,467 | — | ||||||||
Preferred dividends paid | (9,750 | ) | (9,750 | ) | (9,750 | ) | |||||
Net increase in other borrowings | 800,000 | 500,000 | 399,995 | ||||||||
Excess tax benefits from stock-based compensation arrangements | — | 2,013 | 1,499 | ||||||||
Net increase (decrease) in Federal funds purchased and repurchase agreements | 255,465 | (33,476 | ) | 50,375 | |||||||
Net cash provided by financing activities | 3,149,823 | 2,624,985 | 2,852,199 | ||||||||
Net increase in cash and cash equivalents | 66,239 | 1,048,482 | 460,356 | ||||||||
Cash and cash equivalents at beginning of period | 2,839,352 | 1,790,870 | 1,330,514 | ||||||||
Cash and cash equivalents at end of period | $ | 2,905,591 | $ | 2,839,352 | $ | 1,790,870 | |||||
Supplemental disclosures of cash flow information: | |||||||||||
Cash paid during the period for interest | $ | 115,789 | $ | 63,193 | $ | 46,078 | |||||
Cash paid during the period for income taxes | 103,871 | 88,262 | 87,450 | ||||||||
Transfers from loans/leases to OREO and other repossessed assets | — | 18,822 | 1,267 |
December 31, 2017 | |||||||||||||||
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Estimated Fair Value | ||||||||||||
Available-for-sale securities: | |||||||||||||||
Residential mortgage-backed securities | $ | 10,297 | $ | 648 | $ | — | $ | 10,945 | |||||||
Equity securities(1) | 12,556 | 425 | (415 | ) | 12,566 | ||||||||||
$ | 22,853 | $ | 1,073 | $ | (415 | ) | $ | 23,511 |
December 31, 2016 | |||||||||||||||
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Estimated Fair Value | ||||||||||||
Available-for-sale securities: | |||||||||||||||
Residential mortgage-backed securities | $ | 14,680 | $ | 972 | $ | — | $ | 15,652 | |||||||
Municipals | 275 | — | — | 275 | |||||||||||
Equity securities(1) | 9,280 | 27 | (360 | ) | 8,947 | ||||||||||
$ | 24,235 | $ | 999 | $ | (360 | ) | $ | 24,874 |
(1) | Equity securities consist of Community Reinvestment Act funds and investments related to our non-qualified deferred compensation plan. |
December 31, 2017 | |||||||||||||||||||
Less Than One Year | After One Through Five Years | After Five Through Ten Years | After Ten Years | Total | |||||||||||||||
Available-for-sale: | |||||||||||||||||||
Residential mortgage-backed securities:(1) | |||||||||||||||||||
Amortized cost | $ | 409 | $ | 819 | $ | 1,502 | $ | 7,567 | $ | 10,297 | |||||||||
Estimated fair value | 418 | 916 | 1,636 | 7,975 | 10,945 | ||||||||||||||
Weighted average yield(3) | 4.59 | % | 6.02 | % | 5.32 | % | 3.45 | % | 3.97 | % | |||||||||
Equity securities:(4) | |||||||||||||||||||
Amortized cost | 12,556 | — | — | — | 12,556 | ||||||||||||||
Estimated fair value | 12,566 | — | — | — | 12,566 | ||||||||||||||
Total available-for-sale securities: | |||||||||||||||||||
Amortized cost | $ | 22,853 | |||||||||||||||||
Estimated fair value | $ | 23,511 |
December 31, 2016 | |||||||||||||||||||
Less Than One Year | After One Through Five Years | After Five Through Ten Years | After Ten Years | Total | |||||||||||||||
Available-for-sale: | |||||||||||||||||||
Residential mortgage-backed securities:(1) | |||||||||||||||||||
Amortized cost | $ | 9 | $ | 2,047 | $ | 3,147 | $ | 9,477 | $ | 14,680 | |||||||||
Estimated fair value | 9 | 2,104 | 3,495 | 10,044 | 15,652 | ||||||||||||||
Weighted average yield(3) | 5.50 | % | 4.70 | % | 5.55 | % | 2.84 | % | 3.68 | % | |||||||||
Municipals:(2) | |||||||||||||||||||
Amortized cost | 275 | — | — | — | 275 | ||||||||||||||
Estimated fair value | 275 | — | — | — | 275 | ||||||||||||||
Weighted average yield(3) | 5.61 | % | — | — | — | 5.61 | % | ||||||||||||
Equity securities:(4) | |||||||||||||||||||
Amortized cost | 9,280 | — | — | — | 9,280 | ||||||||||||||
Estimated fair value | 8,947 | — | — | — | 8,947 | ||||||||||||||
Total available-for-sale securities: | |||||||||||||||||||
Amortized cost | $ | 24,235 | |||||||||||||||||
Estimated fair value | $ | 24,874 |
(1) | Actual maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without prepayment penalties. |
(2) | Yields have been adjusted to a tax equivalent basis assuming a 35% federal tax rate. |
(3) | Yields are calculated based on amortized cost. |
(4) | These equity securities do not have a stated maturity. |
December 31, 2017 | Less Than 12 Months | 12 Months or Longer | Total | ||||||||||||||||||||
Fair Value | Unrealized Loss | Fair Value | Unrealized Loss | Fair Value | Unrealized Loss | ||||||||||||||||||
Equity securities | $ | 1,015 | $ | (6 | ) | $ | 6,091 | $ | (409 | ) | $ | 7,106 | $ | (415 | ) | ||||||||
December 31, 2016 | Less Than 12 Months | 12 Months or Longer | Total | ||||||||||||||||||||
Fair Value | Unrealized Loss | Fair Value | Unrealized Loss | Fair Value | Unrealized Loss | ||||||||||||||||||
Equity securities | $ | 1,015 | $ | (6 | ) | $ | 6,146 | $ | (354 | ) | $ | 7,161 | $ | (360 | ) |
December 31, | |||||||
2017 | 2016 | ||||||
Commercial | $ | 9,189,811 | $ | 7,291,545 | |||
Mortgage finance | 5,308,160 | 4,497,338 | |||||
Construction | 2,166,208 | 2,098,706 | |||||
Real estate | 3,794,577 | 3,462,203 | |||||
Consumer | 48,684 | 34,587 | |||||
Equipment leases | 264,903 | 185,529 | |||||
Gross loans held for investment | 20,772,343 | 17,569,908 | |||||
Deferred income (net of direct origination costs) | (97,931 | ) | (71,559 | ) | |||
Allowance for loan losses | (184,655 | ) | (168,126 | ) | |||
Total loans held for investment | $ | 20,489,757 | $ | 17,330,223 |
Commercial | Mortgage Finance | Construction | Real Estate | Consumer | Equipment Leases | Total | |||||||||||||||||||||
December 31, 2017 | |||||||||||||||||||||||||||
Grade: | |||||||||||||||||||||||||||
Pass | $ | 8,967,471 | $ | 5,308,160 | $ | 2,152,654 | $ | 3,706,541 | $ | 48,591 | $ | 249,865 | $ | 20,433,282 | |||||||||||||
Special mention | 19,958 | — | 13,554 | 53,652 | — | 495 | 87,659 | ||||||||||||||||||||
Substandard- accruing | 102,651 | — | — | 32,671 | 93 | 14,543 | 149,958 | ||||||||||||||||||||
Non-accrual | 99,731 | — | — | 1,713 | — | — | 101,444 | ||||||||||||||||||||
Total loans held for investment | $ | 9,189,811 | $ | 5,308,160 | $ | 2,166,208 | $ | 3,794,577 | $ | 48,684 | $ | 264,903 | $ | 20,772,343 |
Commercial | Mortgage Finance | Construction | Real Estate | Consumer | Equipment Leases | Total | |||||||||||||||||||||
December 31, 2016 | |||||||||||||||||||||||||||
Grade: | |||||||||||||||||||||||||||
Pass | $ | 6,941,310 | $ | 4,497,338 | $ | 2,074,859 | $ | 3,430,346 | $ | 34,249 | $ | 181,914 | $ | 17,160,016 | |||||||||||||
Special mention | 69,447 | — | 10,901 | 21,932 | — | 3,532 | 105,812 | ||||||||||||||||||||
Substandard-accruing | 115,848 | — | 12,787 | 7,516 | 138 | — | 136,289 | ||||||||||||||||||||
Non-accrual | 164,940 | — | 159 | 2,409 | 200 | 83 | 167,791 | ||||||||||||||||||||
Total loans held for investment | $ | 7,291,545 | $ | 4,497,338 | $ | 2,098,706 | $ | 3,462,203 | $ | 34,587 | $ | 185,529 | $ | 17,569,908 |
Commercial | Mortgage Finance | Construction | Real Estate | Consumer | Equipment Leases | Additional Qualitative Reserve | Total | |||||||||||||||||
December 31, 2017 | ||||||||||||||||||||||||
Allowance for loan losses | ||||||||||||||||||||||||
Beginning balance | $ | 128,768 | $ | — | $ | 13,144 | $ | 19,149 | $ | 241 | $ | 1,124 | $ | 5,700 | $ | 168,126 | ||||||||
Provision for loan losses | 19,590 | — | 6,084 | 15,353 | 226 | 2,408 | 2,690 | 46,351 | ||||||||||||||||
Charge-offs | 34,145 | — | 59 | 290 | 180 | — | — | 34,674 | ||||||||||||||||
Recoveries | 4,593 | — | 104 | 75 | 70 | 10 | — | 4,852 | ||||||||||||||||
Net charge-offs (recoveries) | 29,552 | — | (45 | ) | 215 | 110 | (10 | ) | — | 29,822 | ||||||||||||||
Ending balance | $ | 118,806 | $ | — | $ | 19,273 | $ | 34,287 | $ | 357 | $ | 3,542 | $ | 8,390 | $ | 184,655 | ||||||||
Period end amount allocated to: | ||||||||||||||||||||||||
Loans individually evaluated for impairment | $ | 24,316 | $ | — | $ | — | $ | 101 | $ | — | $ | — | $ | — | $ | 24,417 | ||||||||
Loans collectively evaluated for impairment | 94,490 | — | 19,273 | 34,186 | 357 | 3,542 | 8,390 | 160,238 | ||||||||||||||||
Ending balance | $ | 118,806 | $ | — | $ | 19,273 | $ | 34,287 | $ | 357 | $ | 3,542 | $ | 8,390 | $ | 184,655 | ||||||||
Commercial | Mortgage Finance | Construction | Real Estate | Consumer | Equipment Leases | Additional Qualitative Reserve | Total | |||||||||||||||||
December 31, 2016 | ||||||||||||||||||||||||
Allowance for loan losses | ||||||||||||||||||||||||
Beginning balance | $ | 112,446 | $ | — | $ | 6,836 | $ | 13,381 | $ | 338 | $ | 3,931 | $ | 4,179 | $ | 141,111 | ||||||||
Provision for loan losses | 63,516 | — | 6,274 | 6,233 | (71 | ) | (2,884 | ) | 1,521 | 74,589 | ||||||||||||||
Charge-offs | 56,558 | — | — | 528 | 47 | — | — | 57,133 | ||||||||||||||||
Recoveries | 9,364 | — | 34 | 63 | 21 | 77 | — | 9,559 | ||||||||||||||||
Net charge-offs (recoveries) | 47,194 | — | (34 | ) | 465 | 26 | (77 | ) | — | 47,574 | ||||||||||||||
Ending balance | $ | 128,768 | $ | — | $ | 13,144 | $ | 19,149 | $ | 241 | $ | 1,124 | $ | 5,700 | $ | 168,126 | ||||||||
Period end amount allocated to: | ||||||||||||||||||||||||
Loans individually evaluated for impairment | $ | 34,405 | $ | — | $ | 24 | $ | 133 | $ | 30 | $ | 13 | $ | — | $ | 34,605 | ||||||||
Loans collectively evaluated for impairment | 94,363 | — | 13,120 | 19,016 | 211 | 1,111 | 5,700 | 133,521 | ||||||||||||||||
Ending balance | $ | 128,768 | $ | — | $ | 13,144 | $ | 19,149 | $ | 241 | $ | 1,124 | $ | 5,700 | $ | 168,126 |
Year Ended December 31, | ||||||||
2017 | 2016 | |||||||
Beginning balance | $ | 11,422 | $ | 9,011 | ||||
Provision for off-balance sheet credit losses | (2,351 | ) | 2,411 | |||||
Ending balance | $ | 9,071 | $ | 11,422 |
Commercial | Mortgage Finance | Construction | Real Estate | Consumer | Equipment Leases | Total | |||||||||||||||||||||
December 31, 2017 | |||||||||||||||||||||||||||
Loans individually evaluated for impairment | $ | 100,676 | $ | — | $ | — | $ | 2,008 | $ | — | $ | — | $ | 102,684 | |||||||||||||
Loans collectively evaluated for impairment | 9,089,135 | 5,308,160 | 2,166,208 | 3,792,569 | 48,684 | 264,903 | 20,669,659 | ||||||||||||||||||||
Total | $ | 9,189,811 | $ | 5,308,160 | $ | 2,166,208 | $ | 3,794,577 | $ | 48,684 | $ | 264,903 | $ | 20,772,343 |
Commercial | Mortgage Finance | Construction | Real Estate | Consumer | Equipment Leases | Total | |||||||||||||||||||||
December 31, 2016 | |||||||||||||||||||||||||||
Loans individually evaluated for impairment | $ | 166,669 | $ | — | $ | 159 | $ | 3,751 | $ | 200 | $ | 83 | $ | 170,862 | |||||||||||||
Loans collectively evaluated for impairment | 7,124,876 | 4,497,338 | 2,098,547 | 3,458,452 | 34,387 | 185,446 | 17,399,046 | ||||||||||||||||||||
Total | $ | 7,291,545 | $ | 4,497,338 | $ | 2,098,706 | $ | 3,462,203 | $ | 34,587 | $ | 185,529 | $ | 17,569,908 |
December 31, 2017 | |||||||||||||||||||
Recorded Investment | Unpaid Principal Balance | Related Allowance | Average Recorded Investment | Interest Income Recognized | |||||||||||||||
With no related allowance recorded: | |||||||||||||||||||
Commercial | |||||||||||||||||||
Business loans | $ | 16,835 | $ | 18,257 | $ | — | $ | 22,964 | $ | — | |||||||||
Energy loans | 21,426 | 22,602 | — | 36,579 | — | ||||||||||||||
Construction | |||||||||||||||||||
Market risk | — | — | — | — | — | ||||||||||||||
Real estate | |||||||||||||||||||
Market risk | — | — | — | — | — | ||||||||||||||
Commercial | 1,096 | 1,096 | — | 2,166 | — | ||||||||||||||
Secured by 1-4 family | — | — | — | — | — | ||||||||||||||
Consumer | — | — | — | — | — | ||||||||||||||
Equipment leases | — | — | — | — | — | ||||||||||||||
Total impaired loans with no allowance recorded | $ | 39,357 | $ | 41,955 | $ | — | $ | 61,709 | $ | — | |||||||||
With an allowance recorded: | |||||||||||||||||||
Commercial | |||||||||||||||||||
Business loans | $ | 18,645 | $ | 19,020 | $ | 2,544 | $ | 16,960 | $ | — | |||||||||
Energy loans | 43,770 | 55,875 | 21,772 | 50,867 | 6 | ||||||||||||||
Construction | |||||||||||||||||||
Market risk | — | — | — | 27 | — | ||||||||||||||
Real estate | |||||||||||||||||||
Market risk | 295 | 295 | 6 | 485 | — | ||||||||||||||
Commercial | 499 | 499 | 75 | 166 | — | ||||||||||||||
Secured by 1-4 family | 118 | 118 | 20 | 516 | — | ||||||||||||||
Consumer | — | — | — | 33 | — | ||||||||||||||
Equipment leases | — | — | — | 14 | — | ||||||||||||||
Total impaired loans with an allowance recorded | $ | 63,327 | $ | 75,807 | $ | 24,417 | $ | 69,068 | $ | 6 | |||||||||
Combined: | |||||||||||||||||||
Commercial | |||||||||||||||||||
Business loans | $ | 35,480 | $ | 37,277 | $ | 2,544 | $ | 39,924 | $ | — | |||||||||
Energy loans | 65,196 | 78,477 | 21,772 | 87,446 | 6 | ||||||||||||||
Construction | |||||||||||||||||||
Market risk | — | — | — | 27 | — | ||||||||||||||
Real estate | |||||||||||||||||||
Market risk | 295 | 295 | 6 | 485 | — | ||||||||||||||
Commercial | 1,595 | 1,595 | 75 | 2,332 | — | ||||||||||||||
Secured by 1-4 family | 118 | 118 | 20 | 516 | — | ||||||||||||||
Consumer | — | — | — | 33 | — | ||||||||||||||
Equipment leases | — | — | — | 14 | — | ||||||||||||||
Total impaired loans | $ | 102,684 | $ | 117,762 | $ | 24,417 | $ | 130,777 | $ | 6 |
December 31, 2016 | |||||||||||||||||||
Recorded Investment | Unpaid Principal Balance | Related Allowance | Average Recorded Investment | Interest Income Recognized | |||||||||||||||
With no related allowance recorded: | |||||||||||||||||||
Commercial | |||||||||||||||||||
Business loans | $ | 23,868 | $ | 27,992 | $ | — | $ | 12,361 | $ | — | |||||||||
Energy loans | 46,753 | 54,522 | — | 54,075 | — | ||||||||||||||
Construction | |||||||||||||||||||
Market risk | — | — | — | 2,778 | — | ||||||||||||||
Real estate | |||||||||||||||||||
Market risk | — | — | — | — | — | ||||||||||||||
Commercial | 2,083 | 2,083 | — | 4,483 | 38 | ||||||||||||||
Secured by 1-4 family | — | — | — | — | — | ||||||||||||||
Consumer | — | — | — | — | — | ||||||||||||||
Equipment leases | — | — | — | 403 | — | ||||||||||||||
Total impaired loans with no allowance recorded | $ | 72,704 | $ | 84,597 | $ | — | $ | 74,100 | $ | 38 | |||||||||
With an allowance recorded: | |||||||||||||||||||
Commercial | |||||||||||||||||||
Business loans | $ | 21,303 | $ | 21,303 | $ | 7,055 | $ | 22,277 | $ | — | |||||||||
Energy loans | 74,745 | 88,987 | 27,350 | 73,637 | 24 | ||||||||||||||
Construction | |||||||||||||||||||
Market risk | 159 | 159 | 24 | 53 | — | ||||||||||||||
Real estate | |||||||||||||||||||
Market risk | 1,342 | 1,342 | 20 | 3,000 | — | ||||||||||||||
Commercial | — | — | — | — | — | ||||||||||||||
Secured by 1-4 family | 326 | 326 | 113 | 435 | — | ||||||||||||||
Consumer | 200 | 200 | 30 | 67 | — | ||||||||||||||
Equipment leases | 83 | 83 | 13 | 548 | — | ||||||||||||||
Total impaired loans with an allowance recorded | $ | 98,158 | $ | 112,400 | $ | 34,605 | $ | 100,017 | $ | 24 | |||||||||
Combined: | |||||||||||||||||||
Commercial | |||||||||||||||||||
Business loans | $ | 45,171 | $ | 49,295 | $ | 7,055 | $ | 34,638 | $ | — | |||||||||
Energy loans | 121,498 | 143,509 | 27,350 | 127,712 | 24 | ||||||||||||||
Construction | |||||||||||||||||||
Market risk | 159 | 159 | 24 | 2,831 | — | ||||||||||||||
Real estate | |||||||||||||||||||
Market risk | 1,342 | 1,342 | 20 | 3,000 | — | ||||||||||||||
Commercial | 2,083 | 2,083 | — | 4,483 | 38 | ||||||||||||||
Secured by 1-4 family | 326 | 326 | 113 | 435 | — | ||||||||||||||
Consumer | 200 | 200 | 30 | 67 | — | ||||||||||||||
Equipment leases | 83 | 83 | 13 | 951 | — | ||||||||||||||
Total impaired loans | $ | 170,862 | $ | 196,997 | $ | 34,605 | $ | 174,117 | $ | 62 |
30-59 Days Past Due | 60-89 Days Past Due | Greater Than 90 Days(1) | Total Past Due | Non-accrual | Current | Total | |||||||||||||||||||||
Commercial | |||||||||||||||||||||||||||
Business loans | $ | 12,346 | $ | 13,029 | $ | 6,984 | $ | 32,359 | $ | 34,535 | $ | 7,992,918 | $ | 8,059,812 | |||||||||||||
Energy | 1,100 | — | — | 1,100 | 65,196 | 1,063,703 | 1,129,999 | ||||||||||||||||||||
Mortgage finance loans | — | — | — | — | — | 5,308,160 | 5,308,160 | ||||||||||||||||||||
Construction | |||||||||||||||||||||||||||
Market risk | 239 | — | — | 239 | — | 2,098,446 | 2,098,685 | ||||||||||||||||||||
Commercial | — | — | — | — | — | 35,786 | 35,786 | ||||||||||||||||||||
Secured by 1-4 family | 1,635 | — | — | 1,635 | — | 30,102 | 31,737 | ||||||||||||||||||||
Real estate | |||||||||||||||||||||||||||
Market risk | 1,724 | 295 | — | 2,019 | — | 2,681,527 | 2,683,546 | ||||||||||||||||||||
Commercial | — | — | — | — | 1,595 | 839,787 | 841,382 | ||||||||||||||||||||
Secured by 1-4 family | 174 | 139 | 1,392 | 1,705 | 118 | 267,826 | 269,649 | ||||||||||||||||||||
Consumer | 100 | 74 | — | 174 | — | 48,510 | 48,684 | ||||||||||||||||||||
Equipment leases | 636 | 16 | 53 | 705 | — | 264,198 | 264,903 | ||||||||||||||||||||
Total loans held for investment | $ | 17,954 | $ | 13,553 | $ | 8,429 | $ | 39,936 | $ | 101,444 | $ | 20,630,963 | $ | 20,772,343 |
(1) | Loans past due 90 days and still accruing includes premium finance loans of $5.5 million. These loans are generally secured by obligations of insurance carriers to refund premiums on canceled insurance policies. The refund of premiums from the insurance carriers can take 180 days or longer from the cancellation date. |
December 31, 2017 | ||||||||||
Number of Contracts | Pre-Restructuring Outstanding Recorded Investment | Post-Restructuring Outstanding Recorded Investment | ||||||||
Commercial business loans | 3 | $ | 7,527 | $ | 7,640 | |||||
Energy loans | 1 | $ | 1,070 | $ | — | |||||
Total new restructured loans in 2017 | 4 | $ | 8,597 | $ | 7,640 |
December 31, 2016 | ||||||||||
Number of Contracts | Pre-Restructuring Outstanding Recorded Investment | Post-Restructuring Outstanding Recorded Investment | ||||||||
Energy loans | 2 | $ | 14,235 | $ | 12,236 | |||||
Total new restructured loans in 2016 | 2 | $ | 14,235 | $ | 12,236 |
December 31, | |||||||
2017 | 2016 | ||||||
Extended maturity | $ | 712 | $ | — | |||
Adjusted payment schedule | 6,928 | — | |||||
Combination of maturity extension and payment schedule adjustment | — | 12,236 | |||||
Total | $ | 7,640 | $ | 12,236 |
Year ended December 31, | |||||||||||
2017 | 2016 | 2015 | |||||||||
Beginning balance | $ | 18,961 | $ | 278 | $ | 568 | |||||
Additions | — | 18,822 | 1,267 | ||||||||
Sales | (1,108 | ) | (139 | ) | (1,557 | ) | |||||
Valuation allowance for OREO | — | — | — | ||||||||
Direct write-downs | (6,111 | ) | — | — | |||||||
Ending balance | $ | 11,742 | $ | 18,961 | $ | 278 |
December 31, | |||||||
2017 | 2016 | ||||||
Outstanding balance(1) | $ | 1,009,271 | $ | 980,414 | |||
Fair value(1) | 1,007,695 | 968,929 | |||||
Fair value over (under) outstanding balance | $ | (1,576 | ) | $ | (11,485 | ) |
(1) | Does not include $3.3 million of Small Business Administration ("SBA") loans held for sale carried at lower of cost or market as of December 31, 2017. |
Year Ended December 31, | |||||||
2017 | 2016 | ||||||
Beginning balance | $ | 968,929 | $ | 86,075 | |||
Loans purchased | 5,556,964 | 3,327,482 | |||||
Payments and loans sold | (5,524,798 | ) | (2,433,348 | ) | |||
Change in fair value | 9,909 | (11,280 | ) | ||||
Ending balance(1) | $ | 1,011,004 | $ | 968,929 |
Year Ended December 31, | |||||||
2017 | 2016 | ||||||
MSRs: | |||||||
Balance, beginning of year | $ | 28,536 | $ | 423 | |||
Capitalized servicing rights | 67,970 | 29,816 | |||||
Amortization | (8,356 | ) | (1,703 | ) | |||
Balance, end of period | $ | 88,150 | $ | 28,536 | |||
Valuation allowance: | |||||||
Balance, beginning of year | $ | — | $ | — | |||
Increase in valuation allowance | 2,823 | — | |||||
Balance, end of period | $ | 2,823 | $ | — | |||
MSRs, net(1) | $ | 85,327 | $ | 28,536 | |||
MSRs, fair value | $ | 86,321 | $ | 30,877 |
December 31, | |||||
2017 | 2016 | ||||
Average discount rates | 9.90 | % | 9.96 | % | |
Expected prepayment speeds | 9.99 | % | 7.91 | % | |
Weighted-average life, in years | 7.0 | 8.0 |
December 31, | |||||||
2017 | 2016 | ||||||
50 bp adverse change in prepayment speed | $ | (11,896 | ) | $ | (2,833 | ) | |
100 bp adverse change in prepayment speed | (28,226 | ) | (6,812 | ) |
Gross Goodwill and Intangible Assets | Accumulated Amortization | Net Goodwill and Intangible Assets | |||||||||
December 31, 2017 | |||||||||||
Goodwill | $ | 15,468 | $ | (374 | ) | $ | 15,094 | ||||
Intangible assets—customer relationships and trademarks | 9,006 | (5,060 | ) | 3,946 | |||||||
Total goodwill and intangible assets | $ | 24,474 | $ | (5,434 | ) | $ | 19,040 | ||||
December 31, 2016 | |||||||||||
Goodwill | $ | 15,468 | $ | (374 | ) | $ | 15,094 | ||||
Intangible assets—customer relationships and trademarks | 9,006 | (4,588 | ) | 4,418 | |||||||
Total goodwill and intangible assets | $ | 24,474 | $ | (4,962 | ) | $ | 19,512 |
2018 | $ | 470 | |
2019 | 470 | ||
2020 | 432 | ||
2021 | 405 | ||
2022 | 405 | ||
Thereafter | 1,764 | ||
$ | 3,946 |
December 31, | |||||||
2017 | 2016 | ||||||
Premises | $ | 25,790 | $ | 22,887 | |||
Furniture and equipment | 32,234 | 24,159 | |||||
58,024 | 47,046 | ||||||
Accumulated depreciation | (32,848 | ) | (27,271 | ) | |||
Total premises and equipment, net | $ | 25,176 | $ | 19,775 |
December 31, | |||||||
2017 | 2016 | ||||||
Non-interest-bearing demand deposits | $ | 7,812,660 | $ | 7,994,201 | |||
Interest-bearing deposits | |||||||
Transaction | 2,567,208 | 1,954,834 | |||||
Savings | 8,214,059 | 6,625,177 | |||||
Time | 529,253 | 442,619 | |||||
Total interest-bearing deposits | 11,310,520 | 9,022,630 | |||||
Total deposits | $ | 19,123,180 | $ | 17,016,831 |
2018 | $ | 492,208 | |
2019 | 33,289 | ||
2020 | 2,817 | ||
2021 | 246 | ||
2022 | 244 | ||
2023 and after | 449 | ||
$ | 529,253 |
December 31, | ||||||||||||||||||||
2017 | 2016 | 2015 | ||||||||||||||||||
Balance | Rate(3) | Balance | Rate(3) | Balance | Rate(3) | |||||||||||||||
Federal funds purchased(4) | $ | 359,338 | 1.45 | % | $ | 101,800 | 0.80 | % | $ | 74,164 | 0.55 | % | ||||||||
Customer repurchase agreements(1) | 5,702 | 0.03 | % | 7,775 | 0.05 | % | 68,887 | 0.02 | % | |||||||||||
FHLB borrowings(2) | 2,800,000 | 1.35 | % | 2,000,000 | 0.61 | % | 1,500,000 | 0.31 | % | |||||||||||
Subordinated notes | 281,406 | 5.86 | % | 281,044 | 5.87 | % | 280,682 | 5.75 | % | |||||||||||
Trust preferred subordinated debentures | 113,406 | 3.55 | % | 113,406 | 2.90 | % | 113,406 | 2.47 | % | |||||||||||
Total borrowings | $ | 3,559,852 | $ | 2,504,025 | $ | 2,037,139 | ||||||||||||||
Maximum outstanding at any month end | $ | 3,559,852 | $ | 2,511,579 | $ | 2,042,457 |
(1) | Securities pledged for customer repurchase agreements were $7.3 million, $10.2 million and $14.2 million at December 31, 2017, 2016 and 2015, respectively. |
(2) | FHLB borrowings are collateralized by a blanket floating lien on certain real estate secured loans, mortgage finance assets and also certain pledged securities. The weighted-average interest rates of FHLB borrowings for the years ended December 31, 2017, 2016 and 2015 were 1.08%, 0.43% and 0.18%, respectively. The average balance of FHLB borrowings for the years ended December 31, 2017, 2016 and 2015 were $1.4 billion, $1.4 billion and $1.2 billion, respectively. |
(3) | Interest rate as of period end. |
(4) | The weighted-average interest rates on Federal funds purchased for the years ended December 31, 2017, 2016 and 2015 were 1.20%, 0.57% and 0.29%, respectively. The average balances of Federal funds purchased for the years ended December 31, 2017, 2016 and 2015 were $215.9 million, $90.9 million and $98.8 million, respectively. |
December 31, | |||||||||||
2017 | 2016 | 2015 | |||||||||
FHLB borrowing capacity relating to loans | $ | 3,890,995 | $ | 3,057,915 | $ | 4,101,396 | |||||
FHLB borrowing capacity relating to securities | 2,071 | 1,653 | 1,213 | ||||||||
Total FHLB borrowing capacity | $ | 3,893,066 | $ | 3,059,568 | $ | 4,102,609 | |||||
Unused Federal funds lines available from commercial banks | $ | 885,000 | $ | 1,118,000 | $ | 1,231,000 | |||||
Unused Federal Reserve Borrowings capacity | $ | 4,114,594 | $ | 3,179,087 | $ | 2,966,702 |
Within One Year | After One But Within Three Years | After Three But Within Five Years | After Five Years | Total | |||||||||||||||
Federal funds purchased and customer repurchase agreements | $ | 365,040 | $ | — | $ | — | $ | — | $ | 365,040 | |||||||||
FHLB borrowings | 2,800,000 | — | — | — | 2,800,000 | ||||||||||||||
Subordinated notes | — | — | — | 281,406 | 281,406 | ||||||||||||||
Trust preferred subordinated debentures | — | — | — | 113,406 | 113,406 | ||||||||||||||
Total borrowings | $ | 3,165,040 | $ | — | $ | — | $ | 394,812 | $ | 3,559,852 |
Texas Capital Bancshares Statutory Trust I | Texas Capital Statutory Trust II | Texas Capital Statutory Trust III | Texas Capital Statutory Trust IV | Texas Capital Statutory Trust V | |||||
Date issued | November 19, 2002 | April 10, 2003 | October 6, 2005 | April 28, 2006 | September 29, 2006 | ||||
Trust preferred securities issued | $10,310 | $10,310 | $25,774 | $25,774 | $41,238 | ||||
Floating or fixed rate securities | Floating | Floating | Floating | Floating | Floating | ||||
Interest rate on subordinated debentures | 3 month LIBOR + 3.35% | 3 month LIBOR + 3.25% | 3 month LIBOR + 1.51% | 3 month LIBOR + 1.60% | 3 month LIBOR + 1.71% | ||||
Maturity date | November 2032 | April 2033 | December 2035 | June 2036 | December 2036 |
Year ended December 31, | |||||||||||
2017 | 2016 | 2015 | |||||||||
Current: | |||||||||||
Federal | $ | 94,112 | $ | 86,612 | $ | 80,957 | |||||
State | 3,257 | 2,412 | 2,245 | ||||||||
Total | 97,369 | 89,024 | 83,202 | ||||||||
Deferred | |||||||||||
Federal | 31,276 | (2,946 | ) | (3,561 | ) | ||||||
State | — | — | — | ||||||||
Total | 31,276 | (2,946 | ) | (3,561 | ) | ||||||
Total expense | |||||||||||
Federal | 125,388 | 83,666 | 77,396 | ||||||||
State | 3,257 | 2,412 | 2,245 | ||||||||
Total | $ | 128,645 | $ | 86,078 | $ | 79,641 |
December 31, | |||||||
2017 | 2016 | ||||||
Deferred tax assets: | |||||||
Allowance for credit losses | $ | 42,213 | $ | 64,009 | |||
Loan origination fees | 10,084 | 13,536 | |||||
Stock compensation | 4,460 | 5,761 | |||||
Non-accrual interest | 1,680 | 2,537 | |||||
Deferred lease expense | 911 | 1,519 | |||||
Other | 3,686 | 2,322 | |||||
Total deferred tax assets | 63,034 | 89,684 | |||||
Deferred tax liabilities: | |||||||
Loan origination costs | (1,304 | ) | (1,722 | ) | |||
Leases | (6,850 | ) | (7,962 | ) | |||
MSRs | (17,619 | ) | (10,973 | ) | |||
Depreciation | (7,354 | ) | (6,941 | ) | |||
Unrealized gain on securities | (138 | ) | (223 | ) | |||
Other | (2,068 | ) | (2,971 | ) | |||
Total deferred tax liabilities | (35,333 | ) | (30,792 | ) | |||
Net deferred tax asset | $ | 27,701 | $ | 58,892 |
Year ended December 31, | ||||||||
2017 | 2016 | 2015 | ||||||
U.S. statutory rate | 35 | % | 35 | % | 35 | % | ||
State taxes | 1 | % | 1 | % | 1 | % | ||
Non-deductible expenses | 1 | % | 1 | % | 1 | % | ||
Deferred tax asset write-off | 5 | % | — | % | — | % | ||
Non-taxable income | (1 | )% | (1 | )% | (1 | )% | ||
Other | (1 | )% | — | % | (1 | )% | ||
Effective tax rate | 40 | % | 36 | % | 35 | % |
December 31, 2017 | December 31, 2016 | December 31, 2015 | |||||||||||||||||||||
SARs | Weighted Average Exercise Price | SARs | Weighted Average Exercise Price | SARs | Weighted Average Exercise Price | ||||||||||||||||||
SARs outstanding at beginning of year | 125,863 | $ | 31.68 | 360,544 | $ | 25.73 | 445,009 | $ | 24.83 | ||||||||||||||
SARs granted | — | — | — | — | — | — | |||||||||||||||||
SARs exercised | (51,500 | ) | 33.94 | (234,681 | ) | 22.54 | (84,465 | ) | 20.97 | ||||||||||||||
SARs forfeited | — | — | — | — | — | — | |||||||||||||||||
SARs outstanding at year-end | 74,363 | $ | 30.12 | 125,863 | $ | 31.68 | 360,544 | $ | 25.73 | ||||||||||||||
SARs vested and exercisable at year-end | 60,463 | $ | 26.02 | 94,463 | $ | 26.73 | 307,144 | $ | 22.49 | ||||||||||||||
Weighted average remaining contractual life of SARs vested | 2.82 | 3.62 | 2.36 | ||||||||||||||||||||
Compensation expense | $ | 265,000 | $ | 307,000 | $ | 367,000 | |||||||||||||||||
Unrecognized compensation expense | $ | 127,000 | $ | 392,000 | $ | 699,000 | |||||||||||||||||
Weighted average period over which unrecognized compensation expense is expected to be recognized (in years) | 0.75 | 1.52 | 2.40 | ||||||||||||||||||||
Fair value of shares vested during the year | $ | 294,000 | $ | 337,000 | $ | 436,000 | |||||||||||||||||
Weighted average remaining contractual life of SARs currently outstanding (in years) | 3.35 | 4.32 | 3.08 | ||||||||||||||||||||
Intrinsic value of SARs exercised | $ | 3,802,000 | $ | 4,881,000 | $ | 8,291,000 |
December 31, 2017 | December 31, 2016 | December 31, 2015 | |||||||||||||||||||||
RSUs | Weighted Average Grant Date Fair Value | RSUs | Weighted Average Grant Date Fair Value | RSUs | Weighted Average Grant Date Fair Value | ||||||||||||||||||
RSUs outstanding at beginning of year | 425,055 | $ | 51.28 | 333,174 | $ | 48.60 | 295,165 | $ | 42.93 | ||||||||||||||
RSUs granted | 121,243 | 80.40 | 213,577 | 51.75 | 145,952 | 51.96 | |||||||||||||||||
RSUs exercised | (102,057 | ) | 48.93 | (94,296 | ) | 42.87 | (95,743 | ) | 38.05 | ||||||||||||||
RSUs forfeited | (20,509 | ) | 54.75 | (27,400 | ) | 51.18 | (12,200 | ) | 43.89 | ||||||||||||||
RSUs outstanding at year-end | 423,732 | $ | 60.01 | 425,055 | $ | 51.28 | 333,174 | $ | 48.60 | ||||||||||||||
Compensation expense | $ | 7,790,000 | $ | 4,771,000 | $ | 4,230,000 | |||||||||||||||||
Unrecognized compensation expense | $ | 18,730,000 | $ | 17,167,000 | $ | 13,038,000 | |||||||||||||||||
Weighted average period over which unrecognized compensation expense is expected to be recognized (in years) | 3.15 | 3.37 | 3.30 | ||||||||||||||||||||
Weighted average remaining contractual life of RSUs currently outstanding | 8.33 | 8.65 | 8.29 |
December 31, 2017 | December 31, 2016 | ||||||||||||||
Number of Shares | Weighted Average Grant Date Fair Value | Number of Shares | Weighted Average Grant Date Fair Value | ||||||||||||
RSAs with restrictions outstanding at beginning of year | 1,472 | $ | 33.97 | — | $ | — | |||||||||
RSAs granted | 641 | 78.00 | 1,472 | 33.97 | |||||||||||
RSAs lapsed restrictions | (491 | ) | 33.97 | — | — | ||||||||||
RSAs with restrictions outstanding at year-end | 1,622 | $ | 51.37 | 1,472 | $ | 33.97 | |||||||||
Compensation expense | $ | 24,000 | $ | 15,000 | |||||||||||
Unrecognized compensation expense | $ | 61,000 | $ | 35,000 | |||||||||||
Weighted average period over which unrecognized compensation expense is expected to recognized (in years) | 2.10 | 2.10 | |||||||||||||
Weighted average remaining contractual life of RSUs currently outstanding | 8.69 | 9.13 |
December 31, | |||||||
2017 | 2016 | ||||||
Commitments to extend credit | $ | 6,957,847 | $ | 5,704,381 | |||
Standby letters of credit | 230,958 | 171,266 |
Actual | Minimum Capital Required - Basel III Phase-In Schedule | Minimum capital Required - Basel III Fully Phased-In | Required to be Considered Well Capitalized | ||||||||||||||||||||
Capital Amount | Ratio | Capital Amount | Ratio | Capital Amount | Ratio | Capital Amount | Ratio | ||||||||||||||||
As of December 31, 2017: | |||||||||||||||||||||||
CET1 | |||||||||||||||||||||||
Company | $ | 2,033,830 | 8.45 | % | $ | 1,384,448 | 5.75 | % | $ | 1,685,464 | 7.00 | % | N/A | N/A | |||||||||
Bank | 1,992,152 | 8.28 | % | 1,383.475 | 5.75 | % | 1,684.231 | 7.00 | % | 1,563,929 | 6.50 | % | |||||||||||
Total capital (to risk-weighted assets) | |||||||||||||||||||||||
Company | 2,768,153 | 11.50 | % | 2,227.221 | 9.250 | % | 2,528.196 | 10.50 | % | N/A | N/A | ||||||||||||
Bank | 2,567,961 | 10.67 | % | 2,225.591 | 9.250 | % | 2,526.347 | 10.50 | % | 2,406,044 | 10.00 | % | |||||||||||
Tier 1 capital (to risk-weighted assets) | |||||||||||||||||||||||
Company | 2,293,016 | 9.52 | % | 1,745.659 | 7.25 | % | 2,046.635 | 8.50 | % | N/A | N/A | ||||||||||||
Bank | 2,151,338 | 8.94 | % | 1,744.382 | 7.25 | % | 2,045.138 | 8.50 | % | 1,924,835 | 8.00 | % | |||||||||||
Tier 1 capital (to average assets)(1) | |||||||||||||||||||||||
Company | 2,293,016 | 9.15 | % | 1,002,494 | 4.00 | % | 1,002,494 | 4.00 | % | N/A | N/A | ||||||||||||
Bank | 2,151,338 | 8.59 | % | 1,002,144 | 4.00 | % | 1,002,144 | 4.00 | % | 1,252,680 | 5.00 | % | |||||||||||
As of December 31, 2016: | |||||||||||||||||||||||
CET1 | |||||||||||||||||||||||
Company | $ | 1,841,219 | 8.97 | % | $ | 1,052,205 | 5.125 | % | $ | 1,437,159 | 7.00 | % | N/A | N/A | |||||||||
Bank | 1,735,496 | 8.45 | % | 1,051.989 | 5.125 | % | 1,436.863 | 7.00 | % | 1,334,244 | 6.50 | % | |||||||||||
Total capital (to risk-weighted assets) | |||||||||||||||||||||||
Company | 2,561,663 | 12.48 | % | 1,770.766 | 8.625 | % | 2,155.715 | 10.50 | % | N/A | N/A | ||||||||||||
Bank | 2,297,528 | 11.19 | % | 1,770.421 | 8.625 | % | 2,155.295 | 10.50 | % | 2,052,683 | 10.00 | % | |||||||||||
Tier 1 capital (to risk-weighted assets) | |||||||||||||||||||||||
Company | 2,101,071 | 10.23 | % | 1,360.154 | 6.625 | % | 1,745.103 | 8.50 | % | N/A | N/A | ||||||||||||
Bank | 1,895,348 | 9.23 | % | 1,359.888 | 6.625 | % | 1,744.762 | 8.50 | % | 1,642,147 | 8.00 | % | |||||||||||
Tier 1 capital (to average assets)(1) | |||||||||||||||||||||||
Company | 2,101,071 | 9.34 | % | 900,268 | 4.00 | % | 900,268 | 4.00 | % | N/A | N/A | ||||||||||||
Bank | 1,895,348 | 8.42 | % | 900,070 | 4.00 | % | 900,070 | 4.00 | % | 1,125,087 | 5.00 | % |
(1) | The Tier 1 capital ratio (to average assets) is not impacted by the Basel III Capital Rules; however, it should be noted that the Federal Reserve Board and the FDIC may require the Company and the Bank, respectively, to maintain a Tier 1 capital ratio (to average assets) above the required minimum. |
Year ended December 31, | |||||||||||
2017 | 2016 | 2015 | |||||||||
Numerator: | |||||||||||
Net income | $ | 197,063 | $ | 155,119 | $ | 144,854 | |||||
Preferred stock dividends | 9,750 | 9,750 | 9,750 | ||||||||
Net income available to common stockholders | $ | 187,313 | $ | 145,369 | $ | 135,104 | |||||
Denominator: | |||||||||||
Denominator for basic earnings per share—weighted average shares | 49,587,169 | 46,239,210 | 45,808,440 | ||||||||
Effect of employee stock-based awards(1) | 239,008 | 128,228 | 211,168 | ||||||||
Effect of warrants to purchase common stock | 433,657 | 398,464 | 418,264 | ||||||||
Denominator for dilutive earnings per share—adjusted weighted average shares and assumed conversions | 50,259,834 | 46,765,902 | 46,437,872 | ||||||||
Basic earnings per common share | $ | 3.78 | $ | 3.14 | $ | 2.95 | |||||
Diluted earnings per common share | $ | 3.73 | $ | 3.11 | $ | 2.91 |
(1) | SARs and RSUs outstanding of 13,500, 150,416 and 64,700 in 2017, 2016 and 2015, respectively, have not been included in diluted earnings per share because to do so would have been antidilutive for the periods presented. |
Level 1 | Quoted prices in active markets for identical assets or liabilities. This category includes the assets and liabilities related to our non-qualified deferred compensation plan where values are based on quoted market prices for identical equity securities in an active market. |
Level 2 | Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 2 assets include U.S. government and agency mortgage-backed debt securities, municipal bonds, and Community Reinvestment Act funds. This category also includes loans held for sale and derivative assets and liabilities where values are obtained from independent pricing services using observable market data. |
Level 3 | Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Level 3 assets and liabilities include financial instruments whose value is determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair values requires significant management judgment or estimation. This category includes impaired loans and OREO where collateral values have been based on third party appraisals; however, due to current economic |
Fair Value Measurements Using | |||||||||||
December 31, 2017 | Level 1 | Level 2 | Level 3 | ||||||||
Available for sale securities:(1) | |||||||||||
Residential mortgage-backed securities | $ | — | $ | 10,945 | $ | — | |||||
Municipals | — | — | — | ||||||||
Equity securities(2) | 5,460 | 7,106 | — | ||||||||
Loans held for sale(3) | — | 1,007,695 | — | ||||||||
Loans held for investment(4)(6) | — | — | 21,216 | ||||||||
OREO(5)(6) | — | — | 11,742 | ||||||||
Derivative assets(7) | — | 16,719 | — | ||||||||
Derivative liabilities(7) | — | 17,377 | — | ||||||||
Non-qualified deferred compensation plan liabilities(8) | 5,587 | — | — | ||||||||
December 31, 2016 | |||||||||||
Available for sale securities:(1) | |||||||||||
Residential mortgage-backed securities | $ | — | $ | 15,652 | $ | — | |||||
Municipals | — | 275 | — | ||||||||
Equity securities(2) | 1,786 | 7,161 | — | ||||||||
Loans held for sale(3) | — | 968,929 | — | ||||||||
Loans held for investment(4)(6) | — | — | 52,323 | ||||||||
OREO(5)(6) | — | — | 18,961 | ||||||||
Derivative assets(7) | — | 37,878 | — | ||||||||
Derivative liabilities(7) | — | 26,240 | — | ||||||||
Non-qualified deferred compensation plan liabilities(8) | 1,811 | — | — |
(1) | Securities are measured at fair value on a recurring basis, generally monthly. |
(2) | Equity securities consist of Community Reinvestment Act funds and investments related to our non-qualified deferred compensation plan. |
(3) | Loans held for sale, excluding SBA loans which are carried at lower of cost or market, are measured at fair value on a recurring basis, generally monthly. |
(4) | Includes impaired loans that have been measured for impairment at the fair value of the loan’s collateral. |
(5) | OREO is transferred from loans to OREO at fair value less selling costs. |
(6) | Loans held for investment and OREO are measured on a nonrecurring basis, generally annually or more often as warranted by market and economic conditions |
(7) | Derivative assets and liabilities are measured at fair value on a recurring basis, generally quarterly. |
(8) | Non-qualified deferred compensation plan liabilities represent the fair value of the obligation to the employee, which corresponds to the fair value of the invested assets, and are measured at fair value on a recurring basis, generally monthly. |
December 31, 2017 | December 31, 2016 | ||||||||||||||
Carrying Amount | Estimated Fair Value | Carrying Amount | Estimated Fair Value | ||||||||||||
Financial assets: | |||||||||||||||
Level 1 inputs: | |||||||||||||||
Cash and cash equivalents | $ | 2,905,591 | $ | 2,905,591 | $ | 2,839,352 | $ | 2,839,352 | |||||||
Securities, available-for-sale | 5,460 | 5,460 | 1,786 | 1,786 | |||||||||||
Level 2 inputs: | |||||||||||||||
Securities, available-for-sale | 18,051 | 18,051 | 23,088 | 23,088 | |||||||||||
Loans held for sale | 1,011,004 | 1,011,004 | 968,929 | 968,929 | |||||||||||
Derivative assets | 16,719 | 16,719 | 37,878 | 37,878 | |||||||||||
Level 3 inputs: | |||||||||||||||
Loans held for investment, net | 20,489,757 | 20,480,802 | 17,330,223 | 17,347,199 | |||||||||||
Financial liabilities: | |||||||||||||||
Level 2 inputs: | |||||||||||||||
Federal funds purchased | 359,338 | 359,338 | 101,800 | 101,800 | |||||||||||
Customer repurchase agreements | 5,702 | 5,702 | 7,775 | 7,775 | |||||||||||
Other borrowings | 2,800,000 | 2,800,000 | 2,000,000 | 2,000,000 | |||||||||||
Subordinated notes | 281,406 | 322,415 | 281,044 | 304,672 | |||||||||||
Derivative liabilities | 17,377 | 17,377 | 26,240 | 26,240 | |||||||||||
Level 3 inputs: | |||||||||||||||
Deposits | 19,123,180 | 19,124,121 | 17,016,831 | 17,017,221 | |||||||||||
Trust preferred subordinated debentures | 113,406 | 113,406 | 113,406 | 113,406 |
Year ending December 31, | Minimum Payments | ||
2018 | $ | 16,446 | |
2019 | 16,137 | ||
2020 | 15,286 | ||
2021 | 12,805 | ||
2022 | 12,138 | ||
2023 and thereafter | 17,299 | ||
$ | 90,111 |
December 31, | |||||||
2017 | 2016 | ||||||
Assets | |||||||
Cash and cash equivalents | $ | 144,635 | $ | 220,499 | |||
Loans held for investment (net of unearned income) | 7,500 | — | |||||
Investment in subsidiaries | 2,184,601 | 1,927,392 | |||||
Other assets | 86,300 | 85,560 | |||||
Total assets | $ | 2,423,036 | $ | 2,233,451 | |||
Liabilities and Stockholders’ Equity | |||||||
Other liabilities | $ | 1,244 | $ | 1,284 | |||
Subordinated notes | 108,513 | 108,412 | |||||
Trust preferred subordinated debentures | 113,406 | 113,406 | |||||
Total liabilities | 223,163 | 223,102 | |||||
Preferred stock | 150,000 | 150,000 | |||||
Common stock | 496 | 495 | |||||
Additional paid-in capital | 971,457 | 965,620 | |||||
Retained earnings | 1,077,500 | 893,827 | |||||
Treasury stock | (8 | ) | (8 | ) | |||
Accumulated other comprehensive income | 428 | 415 | |||||
Total stockholders’ equity | 2,199,873 | 2,010,349 | |||||
Total liabilities and stockholders’ equity | $ | 2,423,036 | $ | 2,233,451 |
Year ended December 31, | |||||||||||
2017 | 2016 | 2015 | |||||||||
Interest on loans | $ | 3,271 | $ | 3,250 | $ | 3,250 | |||||
Dividend income | 10,400 | 10,400 | 10,400 | ||||||||
Other income | 108 | 90 | 76 | ||||||||
Total income | 13,779 | 13,740 | 13,726 | ||||||||
Other non-interest income | 13 | 152 | 8 | ||||||||
Interest expense | 10,908 | 10,525 | 9,867 | ||||||||
Salaries and employee benefits | 489 | 431 | 499 | ||||||||
Legal and professional | 1,700 | 1,429 | 1,640 | ||||||||
Other non-interest expense | 1,761 | 1,594 | 1,637 | ||||||||
Total expense | 14,858 | 13,979 | 13,643 | ||||||||
Income (loss) before income taxes and equity in undistributed income of subsidiary | (1,066 | ) | (87 | ) | 91 | ||||||
Income tax expense (benefit) | (371 | ) | (33 | ) | 33 | ||||||
Income (loss) before equity in undistributed income of subsidiary | (695 | ) | (54 | ) | 58 | ||||||
Equity in undistributed income of subsidiary | 194,118 | 151,445 | 141,041 | ||||||||
Net income | 193,423 | 151,391 | 141,099 | ||||||||
Preferred stock dividends | 9,750 | 9,750 | 9,750 | ||||||||
Net income available to common stockholders | $ | 183,673 | $ | 141,641 | $ | 131,349 |
Year ended December 31, | |||||||||||
2017 | 2016 | 2015 | |||||||||
(in thousands) | |||||||||||
Operating Activities | |||||||||||
Net income | $ | 193,423 | $ | 151,391 | $ | 141,099 | |||||
Adjustments to reconcile net income to net cash used in operating activities: | |||||||||||
Equity in undistributed income of subsidiary | (194,118 | ) | (151,445 | ) | (141,041 | ) | |||||
Amortization | 101 | 101 | 100 | ||||||||
Increase in other assets | (739 | ) | (10 | ) | (2,223 | ) | |||||
Excess tax benefits from stock-based compensation arrangements | — | (2,013 | ) | (1,499 | ) | ||||||
Increase in other liabilities | (40 | ) | 165 | (209 | ) | ||||||
Net cash used in operating activities of continuing operations | (1,373 | ) | (1,811 | ) | (3,773 | ) | |||||
Investing Activities | |||||||||||
Net increase in loans held for investment | (7,500 | ) | — | — | |||||||
Investments in and advances to subsidiaries | (55,000 | ) | (57,000 | ) | (110,000 | ) | |||||
Net cash used in investing activities | (62,500 | ) | (57,000 | ) | (110,000 | ) | |||||
Financing Activities | |||||||||||
Proceeds from sale of stock related to stock-based awards | (2,241 | ) | (2,481 | ) | (1,239 | ) | |||||
Proceeds from sale of common stock | — | 236,467 | — | ||||||||
Preferred dividends paid | (9,750 | ) | (9,750 | ) | (9,750 | ) | |||||
Net other borrowings | — | — | — | ||||||||
Excess tax benefits from stock-based compensation arrangements | — | 2,013 | 1,499 | ||||||||
Net cash provided by (used in) financing activities | (11,991 | ) | 226,249 | (9,490 | ) | ||||||
Net increase (decrease) in cash and cash equivalents | (75,864 | ) | 167,438 | (123,263 | ) | ||||||
Cash and cash equivalents at beginning of year | 220,499 | 53,061 | 176,324 | ||||||||
Cash and cash equivalents at end of year | $ | 144,635 | $ | 220,499 | $ | 53,061 |
December 31, 2017 | December 31, 2016 | ||||||||||||||||||||
Estimated Fair Value | Estimated Fair Value | ||||||||||||||||||||
Notional Amount | Asset Derivative | Liability Derivative | Notional Amount | Asset Derivative | Liability Derivative | ||||||||||||||||
Non-hedging derivatives: | |||||||||||||||||||||
Financial institution counterparties: | |||||||||||||||||||||
Commercial loan/lease interest rate swaps | $ | 1,393,764 | $ | 4,736 | $ | 15,482 | $ | 1,144,367 | $ | 1,754 | $ | 25,421 | |||||||||
Commercial loan/lease interest rate caps | 242,700 | 421 | 7 | 210,996 | 819 | — | |||||||||||||||
Foreign currency forward contracts | 2,466 | 4 | 69 | — | — | — | |||||||||||||||
Customer counterparties: | |||||||||||||||||||||
Commercial loan/lease interest rate swaps | 1,393,764 | 15,482 | 4,736 | 1,144,367 | 25,421 | 1,754 | |||||||||||||||
Commercial loan/lease interest rate caps | 242,700 | 7 | 421 | 210,996 | — | 819 | |||||||||||||||
Foreign currency forward contracts | 2,466 | 69 | 4 | — | — | — | |||||||||||||||
Economic hedging interest rate derivatives: | |||||||||||||||||||||
Loan purchase commitments | 253,815 | 635 | 190 | 237,805 | 1,351 | — | |||||||||||||||
Forward sale commitments | 1,086,224 | — | 1,103 | 1,218,000 | 10,287 | — | |||||||||||||||
Gross derivatives | 21,354 | 22,012 | 39,632 | 27,994 | |||||||||||||||||
Offsetting derivative assets/liabilities | (4,635 | ) | (4,635 | ) | (1,754 | ) | (1,754 | ) | |||||||||||||
Net derivatives included in the consolidated balance sheets | $ | 16,719 | $ | 17,377 | $ | 37,878 | $ | 26,240 |
December 31, 2017 Weighted-Average Interest Rate | December 31, 2016 Weighted-Average Interest Rate | ||||||||||
Received | Paid | Received | Paid | ||||||||
Non-hedging interest rate swaps | 3.59 | % | 4.34 | % | 3.17 | % | 4.58 | % |
2017 Selected Quarterly Financial Data | |||||||||||||||
Fourth | Third | Second | First | ||||||||||||
Interest income | $ | 249,519 | $ | 237,643 | $ | 208,191 | $ | 183,946 | |||||||
Interest expense | 38,870 | 33,282 | 25,232 | 20,587 | |||||||||||
Net interest income | 210,649 | 204,361 | 182,959 | 163,359 | |||||||||||
Provision for credit losses | 2,000 | 20,000 | 13,000 | 9,000 | |||||||||||
Net interest income after provision for credit losses | 208,649 | 184,361 | 169,959 | 154,359 | |||||||||||
Non-interest income | 19,374 | 19,003 | 18,769 | 17,110 | |||||||||||
Non-interest expense | 133,138 | 114,830 | 111,814 | 106,094 | |||||||||||
Income before income taxes | 94,885 | 88,534 | 76,914 | 65,375 | |||||||||||
Income tax expense | 50,143 | 29,850 | 25,819 | 22,833 | |||||||||||
Net income | 44,742 | 58,684 | 51,095 | 42,542 | |||||||||||
Preferred stock dividends | 2,437 | 2,438 | 2,437 | 2,438 | |||||||||||
Net income available to common stockholders | $ | 42,305 | $ | 56,246 | $ | 48,658 | $ | 40,104 | |||||||
Basic earnings per share: | $ | 0.85 | $ | 1.13 | $ | 0.98 | $ | 0.81 | |||||||
Diluted earnings per share: | $ | 0.84 | $ | 1.12 | $ | 0.97 | $ | 0.80 | |||||||
Average shares | |||||||||||||||
Basic | 49,630,000 | 49,607,000 | 49,577,000 | 49,536,000 | |||||||||||
Diluted | 50,312,000 | 50,251,000 | 50,230,000 | 50,234,000 |
2016 Selected Quarterly Financial Data | |||||||||||||||
Fourth | Third | Second | First | ||||||||||||
Interest income | $ | 188,671 | $ | 182,492 | $ | 172,442 | $ | 159,803 | |||||||
Interest expense | 17,448 | 15,753 | 15,373 | 15,020 | |||||||||||
Net interest income | 171,223 | 166,739 | 157,069 | 144,783 | |||||||||||
Provision for credit losses | 9,000 | 22,000 | 16,000 | 30,000 | |||||||||||
Net interest income after provision for credit losses | 162,223 | 144,739 | 141,069 | 114,783 | |||||||||||
Non-interest income | 18,835 | 16,716 | 13,932 | 11,297 | |||||||||||
Non-interest expense | 106,523 | 94,799 | 94,255 | 86,820 | |||||||||||
Income before income taxes | 74,535 | 66,656 | 60,746 | 39,260 | |||||||||||
Income tax expense | 26,149 | 23,931 | 21,866 | 14,132 | |||||||||||
Net income | 48,386 | 42,725 | 38,880 | 25,128 | |||||||||||
Preferred stock dividends | 2,437 | 2,438 | 2,437 | 2,438 | |||||||||||
Net income available to common stockholders | $ | 45,949 | $ | 40,287 | $ | 36,443 | $ | 22,690 | |||||||
Basic earnings per share: | $ | 0.97 | $ | 0.88 | $ | 0.79 | $ | 0.49 | |||||||
Diluted earnings per share: | $ | 0.96 | $ | 0.87 | $ | 0.78 | $ | 0.49 | |||||||
Average shares | |||||||||||||||
Basic | 47,156,000 | 45,981,000 | 45,924,000 | 45,889,000 | |||||||||||
Diluted | 47,760,000 | 46,510,000 | 46,438,000 | 46,354,000 |
ITEM 9. | CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE |
ITEM 9A. | CONTROLS AND PROCEDURES |
ITEM 9B. | OTHER INFORMATION |
ITEM 10. | DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE |
ITEM 11. | EXECUTIVE COMPENSATION |
ITEM 12. | SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS |
ITEM 13. | CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE |
ITEM 14. | PRINCIPAL ACCOUNTING FEES AND SERVICES |
ITEM 15. | EXHIBITS, FINANCIAL STATEMENT SCHEDULES |
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21 | |
23.1 | |
31.1 | |
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32.2 | |
101.INS | XBRL Instance Document* |
101.SCH | XBRL Taxonomy Extension Schema Document* |
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document* |
101.DEF | XBRL Taxonomy Extension Definition Linkbase Document* |
101.LAB | XBRL Taxonomy Extension Label Linkbase Document* |
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document* |
* | Filed herewith |
** | Furnished herewith |
+ | Management contract or compensatory plan arrangement |
Date: | February 14, 2018 | TEXAS CAPITAL BANCSHARES, INC. | |||
By: | /S/ C. KEITH CARGILL | ||||
C. Keith Cargill President and Chief Executive Officer |
Date: | February 14, 2018 | /S/ LARRY L. HELM | |
Larry L. Helm Chairman of the Board and Director | |||
Date: | February 14, 2018 | /S/ JULIE ANDERSON | |
Julie Anderson Chief Financial Officer (principal financial and accounting officer) | |||
Date: | February 14, 2018 | /S/ JONATHAN E. BALIFF | |
Jonathan E. Baliff Director | |||
Date: | February 14, 2018 | /S/ JAMES H. BROWNING | |
James H. Browning Director | |||
Date: | February 14, 2018 | /S/ PRESTON M. GEREN III | |
Preston M. Geren III Director | |||
Date: | February 14, 2018 | /S/ DAVID S. HUNTLEY | |
David S. Huntley Director | |||
Date: | February 14, 2018 | /S/ CHARLES S. HYLE | |
Charles S. Hyle Director |
Date: | February 14, 2018 | /S/ ELYSIA H. RAGUSA | |
Elysia H. Ragusa Director | |||
Date: | February 14, 2018 | /S/ STEVEN P. ROSENBERG | |
Steven P. Rosenberg Director | |||
Date: | February 14, 2018 | /S/ ROBERT W. STALLINGS | |
Robert W. Stallings Director | |||
Date: | February 14, 2018 | /S/ DALE W. TREMBLAY | |
Dale W. Tremblay Director | |||
Date: | February 14, 2018 | /S/ IAN J. TURPIN | |
Ian J. Turpin Director | |||
Date: | February 14, 2018 | /S/ PATRICIA A. WATSON | |
Patricia A. Watson Director |
(1) | Registration Statement (Form S-8 No. 333-131503) pertaining to the 2005 Long-Term Incentive Plan and 2006 Employee Stock Purchase Plan of Texas Capital Bancshares, Inc.; |
(2) | Registration Statement (Form S-8 No. 333-166954) pertaining to the 2010 Long-Term Incentive Plan of Texas Capital Bancshares, Inc.; |
(3) | Registration Statement (Form S-3 No. 333-196339) pertaining to the registration of senior debt securities, subordinated debt securities, convertible debt securities, common stock, preferred stock, warrants, depositary shares, stock purchase contracts and stock purchase units; and |
(4) | Registration Statement (Form S-8 No. 333-204357) pertaining to the 2015 Long-Term Incentive Plan of Texas Capital Bancshares, Inc. |
1. | I have reviewed this report on Form 10-K of Texas Capital Bancshares, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures, (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)), and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) | designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this annual report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d) | disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
a) | all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
b) | any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Date: February 14, 2018 |
/S/ C. Keith Cargill |
C. Keith Cargill |
Chief Executive Officer |
1. | I have reviewed this report on Form 10-K of Texas Capital Bancshares, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures, (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)), and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) | designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this annual report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d) | disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
a) | all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
b) | any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Date: February 14, 2018 |
/S/ Julie Anderson |
Julie Anderson |
Chief Financial Officer |
1. | The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and |
2. | The information contained in the Report, fairly presents, in all material respects, the financial condition and results of operations of the Company. |
/S/ C. Keith Cargill |
C. Keith Cargill |
Chief Executive Officer |
Date: February 14, 2018 |
1. | The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and |
2. | The information contained in the Report, fairly presents, in all material respects, the financial condition and results of operations of the Company. |
/S/ Julie Anderson |
Julie Anderson |
Chief Financial Officer |
Date: February 14, 2018 |
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Document and Entity Information - USD ($) |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Feb. 13, 2018 |
Jun. 30, 2017 |
|
Document And Entity Information [Abstract] | |||
Entity Registrant Name | TEXAS CAPITAL BANCSHARES INC/TX | ||
Entity Central Index Key | 0001077428 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Large Accelerated Filer | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2017 | ||
Document Fiscal Year Focus | 2017 | ||
Document Fiscal Period Focus (Q1,Q2,Q3,FY) | FY | ||
Amendment Flag | false | ||
Entity Common Stock, Shares Outstanding | 49,650,549 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Public Float | $ 4,471,032,000 |
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) |
Dec. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Loans held for sale ($1,007.7 million and $968.9 million at December 2017 and 2016, respectively, at fair value) | $ 1,007,695,000 | $ 968,929,000 |
Preferred stock, Liquidation value | $ 1,000 | $ 1,000 |
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 6,000,000 | 6,000,000 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 49,643,761 | 49,504,079 |
Treasury stock, shares | 417 | 417 |
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Parenthetical) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Statement of Stockholders' Equity [Abstract] | |||
Income tax expense (benefit) related to unrealized loss on available-for-sale securities | $ 6 | $ (164) | $ (306) |
Operations and Summary of Significant Accounting Policies |
12 Months Ended |
---|---|
Dec. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Operations and Summary of Significant Accounting Policies | Operations and Summary of Significant Accounting Policies Organization and Nature of Business Texas Capital Bancshares, Inc. (the "Company”), a Delaware corporation, was incorporated in November 1996 and commenced banking operations in December 1998. The consolidated financial statements of the Company include the accounts of Texas Capital Bancshares, Inc. and its wholly owned subsidiary, Texas Capital Bank, National Association (the "Bank”). We are primarily a secured lender and serve the needs of commercial businesses and successful professionals and entrepreneurs located in Texas as well as operate several lines of business serving a regional or national clientèle of commercial borrowers. We are primarily a secured lender, with our greatest concentration of loans in Texas. Basis of Presentation Our accounting and reporting policies conform to accounting principles generally accepted in the United States ("GAAP") and to generally accepted practices within the banking industry. Certain prior period balances have been reclassified to conform to the current period presentation. In that regard, ASU 2016-09, "Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting," ("ASU 2016-09") became effective for us on January 1, 2017. ASU 2016-09 requires that excess tax benefits and deficiencies be recognized as a component of income taxes within the income statement. Additionally, ASU 2016-09 requires that all income tax-related cash flows resulting from share-based payments be reported as operating activities in the statement of cash flows. Previously, income tax benefits at award settlement were reported as a reduction to operating cash flows and an increase to financing cash flows to the extent that those benefits exceeded the income tax benefits reported in earnings during the award's vesting period. We have elected to apply that change in cash flow presentation on a prospective basis. ASU 2016-09 also requires that companies make an accounting policy election regarding forfeitures, to either estimate the number of awards that are expected to vest or account for them when they occur. We have elected to recognize forfeitures as they occur. The impact of this change and that of the remaining provisions of ASU 2016-09 did not have a significant impact on our financial statements. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements. Actual results could differ from those estimates. The allowance for loan losses, the allowance for off-balance sheet credit losses, the fair value of stock-based compensation awards, the fair value of mortgage servicing rights ("MSRs"), the fair value of financial instruments and the status of contingencies are particularly susceptible to significant change. Cash and Cash Equivalents Cash equivalents include amounts due from banks, interest-bearing deposits and Federal funds sold. Securities Securities are classified as trading, available-for-sale or held-to-maturity. Management classifies securities at the time of purchase and re-assesses such designation at each balance sheet date; however, transfers between categories from this re-assessment are rare. Trading Account Securities acquired for resale in anticipation of short-term market movements are classified as trading, with realized and unrealized gains and losses recognized in income. To date, we have not had any activity in our trading account. Available-for-Sale Debt securities are classified as held-to-maturity when we have the positive intent and ability to hold the securities to maturity. Held-to-maturity securities are stated at amortized cost. Debt securities not classified as held-to-maturity or trading and marketable equity securities not classified as trading are classified as available-for-sale. Available-for-sale securities are stated at fair value, with the unrealized gains and losses reported in a separate component of accumulated other comprehensive income (loss), net of tax. The amortized cost of debt securities is adjusted for amortization of premiums and accretion of discounts to maturity, or in the case of mortgage-backed securities, over the estimated life of the security. Such amortization and accretion is included in interest income from securities. Realized gains and losses and declines in value judged to be other-than-temporary are included in gain (loss) on sale of securities. The cost of securities sold is based on the specific identification method. All securities are available-for-sale as of December 31, 2017 and 2016. Loans Loans Held for Sale Through our MCA program, we commit to purchase residential mortgage loans from independent correspondent lenders and deliver those loans into the secondary market via whole loan sales to independent third parties or in securitization transactions to third parties such as Ginnie Mae or to GSEs such as Fannie Mae or Freddie Mac. In some cases, we retain the mortgage servicing rights. Once purchased, these loans are classified as held for sale and are carried at fair value pursuant to our election of the fair value option in accordance with Accounting Standards Codification 825, Financial Instruments ("ASC 825"). At the commitment date, we enter into a corresponding forward sale commitment with a third party, typically Ginnie Mae or a GSE, to deliver the loans within a specified timeframe. The estimated gain/loss for the entire transaction (from initial purchase commitment to final delivery of loans) is recorded as an asset or liability. Fair value is derived from observable current market prices, when available, and includes the fair value of the mortgage servicing rights. Adjustments to reflect unrealized gains and losses resulting from changes in fair value and realized gains and losses upon ultimate sale of the loans are classified as other non-interest income in the consolidated statements of income and other comprehensive income. Pursuant to Ginnie Mae servicing guidelines, we have the unilateral right, but not the obligation, to repurchase certain delinquent loans securitized in Ginnie Mae pools, if they meet defined delinquent loan criteria. Once the delinquency criteria have been met, and regardless of whether the repurchase option has been exercised, we account for these loans as if they had been repurchased and recognize the loans and a corresponding liability as held for sale and other liabilities, respectively, in the consolidated balance sheets. If the loans are actually repurchased, the liability is cash settled and the loans continue to be reported as held for sale. As an approved lender, we may collect losses incurred on repurchased loans through a claims process with the government agency. Loans Held for Investment Loans held for investment (which include equipment leases accounted for as financing leases) are stated at the amount of unpaid principal reduced by deferred income (net of costs). Interest on loans is recognized using the simple-interest method on the daily balances of the principal amounts outstanding. Loan origination fees, net of direct loan origination costs, and commitment fees, are deferred and amortized as an adjustment to yield over the life of the loan, or over the commitment period, as applicable. A loan held for investment is considered impaired when, based on current information and events, it is probable that we will be unable to collect all amounts due (both principal and interest) according to the terms of the loan agreement. Reserves on impaired loans are measured based on the present value of expected future cash flows discounted at the loan’s effective interest rate or the fair value of the underlying collateral, less cost to sell. Impaired loans, or portions thereof, are charged off when a confirmed loss exists. The accrual of interest on loans is discontinued when there is a clear indication that the borrower’s cash flow may not be sufficient to meet payments as they become due, which is generally when a loan is 90 days past due. When a loan is placed on non-accrual status, all previously accrued and unpaid interest is reversed. Interest income is subsequently recognized on a cash basis as long as the remaining book balance of the asset is deemed to be collectible. If collectability is questionable, then cash payments are applied to principal. A loan is placed back on accrual status when both principal and interest are current and it is probable that we will be able to collect all amounts due (both principal and interest) according to the terms of the loan agreement. Loans held for investment includes legal ownership interests in mortgage loans that we purchase through our mortgage warehouse lending division. The ownership interests are purchased from unaffiliated mortgage originators who are seeking additional funding through sale of the undivided ownership interests to facilitate their ability to originate loans. The mortgage originator has no obligation to offer and we have no obligation to purchase these interests. The originator closes mortgage loans consistent with underwriting standards established by approved investors, and, at the time of the sale to the investor, our ownership interest and that of the originator are delivered by us to the investor selected by the originator and approved by us. We typically purchase up to a 99% ownership interest in each mortgage with the originator owning the remaining percentage. These mortgage ownership interests are generally held by us for a period of less than 30 days and more typically 10-20 days. Because of conditions in agreements with originators designed to reduce transaction risks, under ASC 860, Transfers and Servicing of Financial Assets (“ASC 860”), the ownership interests do not qualify as participating interests. Under ASC 860, the ownership interests are deemed to be loans to the originators and payments we receive from investors are deemed to be payments made by or on behalf of the originator to repay the loan deemed made to the originator. Because we have an actual, legal ownership interest in the underlying residential mortgage loan, these interests are not extensions of credit to the originators that are secured by the mortgage loans as collateral. Due to market conditions or events of default by the investor or the originator, we could be required to purchase the remaining interests in the mortgage loans and hold them beyond the expected 10-20 days. Mortgage loans acquired under these conditions would require mark-to-market adjustments to income and could require future allocations of the allowance for loan losses or be subject to charge off in the event the loans become impaired. Mortgage loan interests purchased and disposed of as expected receive no allocation of the allowance for loan losses due to the minimal loss experience with these assets. Allowance for Loan Losses The allowance for loan losses is comprised of general reserves, specific reserves for impaired loans and an additional qualitative reserve based on our estimate of losses inherent in the portfolio at the balance sheet date, but not yet identified with specified loans. We regularly evaluate our allowance for loan losses to maintain an appropriate level to absorb estimated loan losses inherent in the loan portfolio. Factors contributing to the determination of the allowance include the creditworthiness of the borrower, changes in the value of pledged collateral, and general economic conditions. All loan commitments rated substandard or worse and greater than $500,000 are specifically reviewed for loss potential. For loans deemed to be impaired, a specific allocation is assigned based on the losses expected to be realized from those loans. For purposes of determining the general reserve, the portfolio is segregated by product types to recognize differing risk profiles among categories, and then further segregated by credit grades. Credit grades are assigned to all loans. Each credit grade is assigned a risk factor, or reserve allocation percentage. These risk factors are multiplied by the outstanding principal balance and risk-weighted by product type to calculate the required reserve. A similar process is employed to calculate a reserve assigned to off-balance sheet commitments, specifically unfunded loan commitments and letters of credit, and any needed reserve is recorded in other liabilities. Even though portions of the allowance may be allocated to specific loans, the entire allowance is available for any credit that, in management’s judgment, should be charged off. We have several pass credit grades that are assigned to loans based on varying levels of risk, ranging from credits that are secured by cash or marketable securities, to watch credits which have all the characteristics of an acceptable credit risk but warrant more than the normal level of monitoring. Within our criticized/classified credit grades are special mention, substandard, and doubtful. Special mention loans are those that are currently protected by the sound worth and paying capacity of the borrower, but that are potentially weak and constitute an additional credit risk. These loans have the potential to deteriorate to a substandard grade due to the existence of financial or administrative deficiencies. Substandard loans have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that we will sustain some loss if the deficiencies are not corrected. Some substandard loans are inappropriately protected by sound worth and paying capacity of the borrower and of the collateral pledged and may be considered impaired. Substandard loans can be accruing or can be on non-accrual depending on the circumstances of the individual loans. Loans classified as doubtful have all the weaknesses inherent in substandard loans with the added characteristics that the weaknesses make collection or liquidation in full highly questionable and improbable. The possibility of loss is extremely high. All doubtful loans are on non-accrual. The allowance allocation percentages assigned to each credit grade have been developed based primarily on an analysis of our historical loss rates. The allocations are adjusted for certain qualitative factors, including general economic conditions, changes in credit policies and lending standards. Changes in the trend and severity of problem loans can cause the estimation of losses to differ from past experience. In addition, the allowance considers the results of reviews performed by our Credit Review group as reflected in their confirmations of assigned credit grades within the portfolio. The portion of the allowance that is not derived by the allowance allocation percentages compensates for the uncertainty and complexity in estimating loan and lease losses including factors and conditions that may not be fully reflected in the determination and application of the allowance allocation percentages. Examples of risks that support the Bank's maintaining an additional qualitative reserve include economic uncertainties and unpredictable factors that produce losses, including those resulting from borrowers' submission of financial information or inaccurate certification of collateral values. These situations, while not common, do not necessarily correlate well with historical loss trends or general economic conditions. Our methodology used to calculate the allowance considers historical losses, however, the historical loss rates for specific product types or credit risk grades may not fully incorporate the effects of uncertainty regarding the economy or other unpredictable events. The methodology used in the periodic review of the appropriateness of the allowance, which is performed at least quarterly, is designed to be dynamic and responsive to changes in portfolio credit quality. The changes are reflected in the general allowance and in specific reserves as the collectability of classified loans is evaluated with new information. As our portfolio has matured, historical loss ratios have been closely monitored, and our reserve appropriateness relies primarily on our loss history. The review of the appropriateness of the allowance is performed by executive management and presented to the audit and risk committees of our board of directors for their review. The committees report to the board as part of the board's review on a quarterly basis of the Company's consolidated financial statements. Other Real Estate Owned Other real estate owned (“OREO”), which is included in other assets on the consolidated balance sheet, consists of real estate that has been foreclosed. Real estate that has been foreclosed is recorded at the fair value of the real estate, less selling costs, through a charge to the allowance for loan losses, if necessary. Subsequent write-downs required for declines in value are recorded through a valuation allowance, or taken directly to the asset, charged to other non-interest expense. Premises and Equipment Premises and equipment are stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of the assets, which range from three to ten years. Gains or losses on disposals of premises and equipment are included in other non-interest income in the consolidated income statements. Marketing and Software Marketing costs are expensed as incurred. Ongoing maintenance and enhancements of websites are expensed as incurred. Costs incurred in connection with development or purchase of internal use software are capitalized and amortized over a period not to exceed five years. Internal use software costs are included in other assets in the consolidated balance sheets. Goodwill and Other Intangible Assets Intangible assets are acquired assets that lack physical substance but can be distinguished from goodwill because of contractual or other legal rights or because the asset is capable of being sold or exchanged either on its own or in combination with a related contract, asset, or liability. Our intangible assets relate primarily to loan customer relationships. Intangible assets with definite useful lives are amortized over their estimated life. Goodwill and intangible assets are tested for impairment in October on an annual basis or whenever events or changes in circumstances indicate the carrying amount of the assets may not be recoverable from future undiscounted cash flows. If impaired, the assets are recorded at fair value. Segment Reporting We have determined that all of our lending divisions and subsidiaries meet the aggregation criteria of ASC 280, Segment Reporting, since all offer similar products and services, operate with similar processes, and have similar customers. Stock-based Compensation We account for all stock-based compensation transactions in accordance with ASC 718, Compensation — Stock Compensation (“ASC 718”), which requires that stock compensation transactions be recognized as compensation expense in the consolidated statement of income and other comprehensive income based on their fair values on the measurement date, which is the date of the grant. Accumulated Other Comprehensive Income Unrealized gains or losses on our available-for-sale securities (after applicable income tax expense or benefit) are included in accumulated other comprehensive income, net. Accumulated other comprehensive income (loss), net is reported in the accompanying consolidated statements of stockholders’ equity and consolidated statements of income and other comprehensive income. Income Taxes The Company and its subsidiary file a consolidated federal income tax return. We utilize the liability method in accounting for income taxes. Under this method, deferred tax assets and liabilities are determined based upon the difference between the values of the assets and liabilities as reflected in the financial statements and their related tax basis using enacted tax rates in effect for the year in which the differences are expected to be recovered or settled. As changes in tax law or rates are enacted, deferred tax assets and liabilities are adjusted through the provision for income taxes. A valuation allowance is provided against deferred tax assets unless it is more likely than not that such deferred tax assets will be realized. Basic and Diluted Earnings Per Common Share Basic earnings per common share is based on net income available to common stockholders divided by the weighted-average number of common shares outstanding during the period excluding non-vested stock. Diluted earnings per common share include the dilutive effect of stock options and non-vested stock awards granted using the treasury stock method. A reconciliation of the weighted-average shares used in calculating basic earnings per common share and the weighted average common shares used in calculating diluted earnings per common share for the reported periods is provided in Note 15 — Earnings Per Share. Fair Values of Financial Instruments ASC 820, Fair Value Measurements and Disclosures (“ASC 820”), defines fair value, establishes a framework for measuring fair value under GAAP and enhances disclosures about fair value measurements. In general, fair values of financial instruments are based upon quoted market prices, where available. If such quoted market prices are not available, fair value is based on estimates using present value or other valuation techniques. Those techniques are significantly affected by the assumptions used, including the discount rate and estimates of future cash flows. Mortgage Servicing Rights Mortgage servicing rights are created by selling purchased or originated mortgage loans with servicing rights retained. We identify classes of servicing rights based upon the nature of the underlying assumptions used to value the asset along with the risks associated with the underlying asset. Based upon these criteria we have one class of MSRs, residential. Originated MSRs are recognized based on the estimated fair value of the mortgage loans and the related servicing rights at the date of sale using values derived from a valuation model managed by an independent third party. MSRs are amortized proportionally over the estimated life of the projected net servicing revenue and are periodically evaluated for impairment. MSRs are reported on the consolidated balance sheets at amortized cost, less a valuation allowance if the fair value of identified strata within the MSR portfolio are determined to have a fair value that is less than amortized cost. Loan servicing fee income represents income earned for servicing mortgage loans owned by investors and includes mortgage servicing fees and other ancillary servicing income. Servicing fees are recorded as income when earned and are reported in other non-interest income on the consolidated statements of income and other comprehensive income. For additional information on MSRs, see Note 5 - Certain Transfers of Financial Assets. Financial Instruments with Off-Balance Sheet Risk The Company has undertaken certain guarantee obligations in the ordinary course of business which include liabilities with off-balance sheet risk. We consider the following arrangements to be guarantees: commitments to extend credit, standby letters of credit and indemnification agreements included within third party contractual arrangements. For additional information on commitments and contingencies, see Note 13 - Financial Instruments with Off-Balance Sheet Risk. Derivative Financial Instruments All contracts that satisfy the definition of a derivative are recorded at fair value in other assets and other liabilities in the consolidated balance sheets. We record the derivatives on a net basis when a right of offset exists, based on transactions with a single counterparty that are subject to a legally enforceable master netting agreement. For additional information on derivative financial instruments, see Note 20 - Derivative Financial Instruments. |
Securities |
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Securities | Securities The following is a summary of securities (in thousands):
The amortized cost and estimated fair value of securities are presented below by contractual maturity (in thousands, except percentage data):
Securities with carrying values of approximately $8.8 million and $13.6 million were pledged to secure certain borrowings and deposits at December 31, 2017 and 2016, respectively. See Note 9 — Borrowing Arrangements for discussion of securities securing borrowings. Of the pledged securities at December 31, 2017 and 2016, approximately $1.6 million and $3.4 million, respectively, were pledged for certain deposits. The following table discloses, as of December 31, 2017 and December 31, 2016, our investment securities that have been in a continuous unrealized loss position for less than 12 months and those that have been in a continuous unrealized loss position for 12 or more months (in thousands):
At December 31, 2017 and December 31, 2016, we owned two securities with an unrealized loss position. These securities are publicly traded equity funds and are subject to market pricing volatility. We do not believe that this unrealized loss is “other than temporary.” We have evaluated the near-term prospects of the investments in relation to the severity and duration of the impairment and based on that evaluation have the ability and intent to hold the investments until recovery of fair value. Unrealized gains or losses on our available-for-sale securities (after applicable income tax expense or benefit) are included in accumulated other comprehensive income, net. |
Loans and Allowance for Credit Losses |
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Accounts, Notes, Loans and Financing Receivable, Gross, Allowance, and Net [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loans and Allowance for Credit Losses | Loans Held for Investment and Allowance for Loan Losses Loans held for investment are summarized by category as follows (in thousands):
Commercial Loans and Leases. Our commercial loan portfolio is comprised of lines of credit for working capital and term loans and leases to finance equipment and other business assets. Our energy production loans are generally collateralized with proven reserves based on appropriate valuation standards and take into account the risk of oil and gas price volatility. Our commercial loans and leases are underwritten after carefully evaluating and understanding the borrower’s ability to operate profitably. Our underwriting standards are designed to promote relationship banking rather than to make loans on a transaction basis. Our lines of credit typically are limited to a percentage of the value of the assets securing the line. Lines of credit and term loans typically are reviewed annually, or more frequently, as needed, and are supported by accounts receivable, inventory, equipment and other assets of our clients’ businesses. Mortgage Finance Loans. Our mortgage finance loans consist of ownership interests purchased in single-family residential mortgages funded through our mortgage warehouse lending division. We have agreements with mortgage lenders and purchase interests in individual loans they originate. The ownership interests collateralizing our mortgage finance loans are typically held on our balance sheet for 10 to 20 days, and substantially all loans are conforming loans. All mortgage finance loans are underwritten consistently with established programs for permanent financing with financially sound investors. Balances as of December 31, 2017 and 2016 are stated net of $171.2 million and $839.0 million participations sold, respectively. Construction Loans. Our construction loan portfolio consists primarily of single- and multi-family residential properties and commercial projects used in manufacturing, warehousing, service or retail businesses. Our construction loans generally have terms of one to three years. We typically make construction loans to developers, builders and contractors that have an established record of successful project completion and loan repayment and have a substantial equity investment in the borrowers. Loan amounts are derived primarily from the Bank's evaluation of expected cash flows available to service debt from stabilized projects under hypothetically stressed conditions. Construction loans are also based in part upon estimates of costs and value associated with the completed project. Sources of repayment for these types of loans may be permanent loans from other lenders, sales of developed property, or an interim loan commitment from us until permanent financing is obtained. The nature of these loans makes ultimate repayment sensitive to overall economic conditions. Borrowers may not be able to correct conditions of default in loans, increasing risk of exposure to classification, non-performing status, reserve allocation and actual credit loss and foreclosure. These loans typically have floating rates and require commitment fees. Real Estate Loans. A portion of our real estate loan portfolio is comprised of loans secured by properties other than market risk or investment-type real estate. Market risk loans are real estate loans where the primary source of repayment is expected to come from the sale, permanent financing or lease of the real property collateral. We generally provide temporary financing for commercial and residential property. These loans are viewed primarily as cash flow loans and secondarily as loans secured by real estate. Our real estate loans generally have maximum terms of five to seven years, and we provide loans with both floating and fixed rates. Real estate loans may be more adversely affected by conditions in the real estate markets or in the general economy. Appraised values may be highly variable due to market conditions and the impact of the inability of potential purchasers and lessees to obtain financing and a lack of transactions at comparable values. At December 31, 2017 and 2016, we had a blanket floating lien on certain real estate-secured loans, mortgage finance loans and also certain securities used as collateral for FHLB borrowings. Summary of Loan Losses The allowance for loan losses is comprised of general reserves, specific reserves for impaired loans and an additional qualitative reserve based on our estimate of losses inherent in the portfolio at the balance sheet date, but not yet identified with specified loans. We believe the allowance at December 31, 2017 to be appropriate, given management's assessment of losses inherent in the portfolio as of the evaluation date, the significant growth in the loan and lease portfolio, current economic conditions in our market areas and other factors. The following tables summarize the credit risk profile of our loan portfolio by internally assigned grades and non-accrual status as of December 31, 2017 and 2016 (in thousands):
The following tables detail activity in the allowance for loan losses by portfolio segment for the years ended December 31, 2017 and 2016 (in thousands). Allocation of a portion of the allowance to one category of loans does not preclude its availability to absorb losses in other categories.
The table below presents the activity in the allowance for off-balance sheet credit losses related to losses on unfunded commitments for the years ended December 31, 2017 and 2016 (in thousands). This allowance is recorded in other liabilities in the consolidated balance sheet.
We have traditionally maintained an additional qualitative reserve component to compensate for the uncertainty and complexity in estimating loan and lease losses including factors and conditions that may not be fully reflected in the determination and application of the allowance allocation percentages. The increase in the additional qualitative reserve at December 31, 2017 was primarily driven by a $4.5 million provision in the third quarter of 2017 reflecting our assessment of the potential impact to our loan portfolio from Hurricanes Harvey and Irma. We believe the level of additional qualitative reserves at December 31, 2017 is warranted due to economic uncertainties and unpredictable factors that have produced losses, including those resulting from borrowers' misstatement of financial information or inaccurate certification of collateral values. Such losses are not necessarily correlated with historical loss trends or general economic conditions. Our methodology used to calculate the allowance considers historical losses; however, the historical loss rates for specific product types or credit risk grades may not fully incorporate the effects of uncertainty regarding the economy or other unpredictable events. Our recorded investment in loans as of December 31, 2017 and 2016 related to each balance in the allowance for loan losses by portfolio segment and disaggregated on the basis of our impairment methodology was as follows (in thousands):
Generally we place loans on non-accrual when there is a clear indication that the borrower’s cash flow may not be sufficient to meet payments as they become due, which is generally when a loan is 90 days past due. When a loan is placed on non-accrual status, all previously accrued and unpaid interest is reversed. Interest income is subsequently recognized on a cash basis as long as the remaining unpaid principal amount of the loan is deemed to be fully collectible. If collectability is questionable, then cash payments are applied to principal. We recognized $1.3 million in interest income on non-accrual loans during 2017 compared to $1.4 million in 2016 and $1.6 million in 2015. Additional interest income that would have been recorded if the loans had been current during the years ended December 31, 2017, 2016 and 2015 totaled $19.0 million, $7.9 million and $7.0 million, respectively. As of December 31, 2017, none of our non-accrual loans were earning on a cash basis, compared to $811,000 at December 31, 2016. A loan is placed back on accrual status when both principal and interest are current and it is probable that we will be able to collect all amounts due (both principal and interest) according to the terms of the loan agreement. A loan held for investment is considered impaired when, based on current information and events, it is probable that we will be unable to collect all amounts due (both principal and interest) according to the terms of the original loan agreement. In accordance with ASC 310, Receivables, we have also included all restructured and formerly restructured loans in our impaired loan totals. The following tables detail our impaired loans, by portfolio class, as of December 31, 2017 and 2016 (in thousands):
Average impaired loans outstanding during the years ended December 31, 2017, 2016 and 2015 totaled $130.8 million, $174.1 million and $102.3 million, respectively. The table below provides an age analysis of our loans held for investment as of December 31, 2017 (in thousands):
Restructured loans are loans on which, due to the borrower’s financial difficulties, we have granted a concession that we would not otherwise consider for borrowers of similar credit quality. This may include a transfer of real estate or other assets from the borrower, a modification of loan terms, or a combination of the two. Modifications of terms that could potentially qualify as a restructuring include reduction of contractual interest rate, extension of the maturity date at a contractual interest rate lower than the current rate for new debt with similar risk, or a reduction of the face amount of debt, or forgiveness of either principal or accrued interest. As of December 31, 2017 and December 31, 2016, we did not have any loans considered restructured that were not on non-accrual. Of the non-accrual loans at December 31, 2017 and 2016, $18.8 million and $18.1 million, respectively, met the criteria for restructured. These loans had no unfunded commitments at their respective balance sheet dates. A loan continues to qualify as restructured until a consistent payment history or change in borrower’s financial condition has been evidenced, generally no less than twelve months. Assuming that the restructuring agreement specifies an interest rate at the time of the restructuring that is greater than or equal to the rate that we are willing to accept for a new extension of credit with comparable risk, then the loan no longer has to be considered a restructuring if it is in compliance with modified terms in calendar years after the year of the restructure. The following tables summarize, as of December 31, 2017 and 2016, loans that have been restructured during 2017 and 2016 (in thousands, except number of contracts):
The restructured loans generally include terms to temporarily place the loan on interest only, extend the payment terms or reduce the interest rate. We did not forgive any principal on the above loans. The $957,000 decrease in the post-restructuring recorded investment in 2017 and the $2.0 million decrease in the post-restructuring recorded investment in 2016 were due to paydowns. At December 31, 2017, $7.6 million of the above loans restructured in 2017 are on non-accrual. The restructuring of the loans did not have a significant impact on our allowance for loan losses at December 31, 2017 or 2016. The following table provides information on how loans were modified as restructured loans during the year ended December 31, 2017 and 2016 (in thousands):
As of December 31, 2017 and 2016, we did not have any loans that were restructured within the last 12 months that subsequently defaulted. |
OREO and Valuation Allowance for Losses on OREO |
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Real Estate Owned, Disclosure of Detailed Components [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
OREO and Valuation Allowance for Losses on OREO | OREO and Valuation Allowance for Losses on OREO The table below presents a summary of the activity related to OREO (in thousands):
When foreclosure occurs, the acquired asset is recorded at fair value less selling costs, generally based on appraised value, which may result in partial charge-off of the loan. Subsequent write-downs required for declines in value are recorded through a valuation allowance or taken directly against the asset and charged to other non-interest expense. During 2017, we recorded a $6.1 million write-down on one asset. |
Certain Transfers of Financial Assets |
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Transfers and Servicing [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Certain Transfers of Financial Assets | Certain Transfers of Financial Assets Through our MCA business, we commit to purchase residential mortgage loans from independent correspondent lenders and deliver those loans into the secondary market via whole loans sales to independent third parties or in securitization transactions to Ginnie Mae and GSEs such as Fannie Mae and Freddie Mac. We have elected to carry these loans at fair value based on sales commitments and market quotes. Gains and losses on the sale of mortgage loans held for sale and changes in the fair value of the loans held for sale are included in other non-interest income on the consolidated income statement. Residential mortgage loans held for sale are subject to both credit and interest rate risk. Credit risk is managed through underwriting policies and procedures, including collateral requirements, which are generally accepted by the secondary loan markets. Exposure to interest rate fluctuations is partially managed through forward sales contracts, which set the price for loans that will be delivered in the next 60 to 90 days. The table below presents the unpaid principal balance of loans held for sale and related fair values at December 31, 2017 and 2016 (in thousands):
No loans held for sale were on non-accrual as of December 31, 2017 or December 31, 2016. At December 31, 2017, we had $19.7 million in loans held for sale that were 90 days or more past due, compared to none at December 31, 2016. Of this $19.7 million, $19.0 million are loans with government guarantees that we purchased and sold into securitized Ginnie Mae pools. Pursuant to Ginnie Mae servicing guidelines, we have the unilateral right, but not the obligation, to repurchase these loans if they meet defined delinquent loan criteria, and therefore must record any delinquent loans as held for sale on our balance sheet regardless of whether the repurchase option has been exercised. The table below presents a reconciliation of the changes in loans held for sale for the years December 31, 2017 and 2016 (in thousands):
(1) Includes $3.3 million of SBA loans held for sale carried at lower of cost or market at December 31, 2017. We generally retain the right to service the loans sold, creating MSRs which are recorded as assets on our balance sheet. A summary of MSR activity for the years ended December 31, 2017 and 2016 is as follows (in thousands):
(1) MSRs are reported on the consolidated balance sheets at amortized cost. At December 31, 2017 and 2016, our servicing portfolio of residential mortgage loans had an outstanding principal balance of $7.0 billion and $2.2 billion, respectively. In connection with the servicing of these loans, we hold deposits in the name of investors representing escrow funds for taxes and insurance, as well as collections in transit to investors. These escrow funds are segregated and held in separate non-interest-bearing bank accounts at the Bank. These deposits, included in total non-interest-bearing deposits on the consolidated balance sheets, were $73.4 million at December 31, 2017 and $21.0 million at December 31, 2016. The estimated fair value of the MSR assets is obtained from an independent third party and reviewed by management on a quarterly basis. MSRs typically do not trade in an active, open market with readily observable prices; as such, the fair value of MSRs is determined using a discounted cash flow model to calculate the present value of the estimated future net servicing income. The assumptions utilized in the discounted cash flow model are based on market data for comparable assets, where available. Each quarter, management and the independent third party discuss the key assumptions used in the discounted cash flow model and make adjustments as necessary to estimate the fair value of the MSRs. At December 31, 2017, the estimated fair value of MSRs was adjusted in anticipation of a sale of Ginnie Mae MSRs in the first quarter of 2018, which resulted in a $2.8 million impairment charge. As of December 31, 2017 and December 31, 2016, management used the following assumptions to determine the fair value of MSRs:
A sensitivity analysis of changes in the fair value of our MSR portfolio resulting from certain key assumptions is presented in the following table (in thousands):
These sensitivities are hypothetical and actual results may differ materially due to a number of factors. The effect on fair value of a 10% variation in assumptions generally cannot be determined with confidence because the relationship of the change in assumptions to the fair value may not be linear. Additionally, the impact of a variation in a particular assumption on the fair value is calculated while holding other assumptions constant. In reality, changes in one factor may be correlated with changes in other factors, which could impact the sensitivity analysis as presented. In conjunction with the sale and securitization of loans held for sale, we may be exposed to liability resulting from recourse agreements and repurchase agreements. If it is determined subsequent to our sale of a loan that the loan sold is in breach of the representations or warranties made in the applicable sale agreement, we may have an obligation to either (a) repurchase the loan for the unpaid principal balance, accrued interest and related advances, (b) indemnify the purchaser against any loss it suffers or (c) make the purchaser whole for the economic benefits of the loan. Our repurchase, indemnification and make whole obligations vary based upon the terms of the applicable agreements, the nature of the asserted breach and the status of the mortgage loan at the time a claim is made. We establish reserves for estimated losses of this nature inherent in the origination of mortgage loans by estimating the losses inherent in the population of all loans sold based on trends in claims and actual loss severities experienced. The reserve will include accruals for probable contingent losses in addition to those identified in the pipeline of claims received. The estimation process is designed to include amounts based on actual losses experienced from actual repurchase activity. Our estimated exposure related to loans previously sold was $1.3 million at December 31, 2017 and $835,000 at December 31, 2016 and is recorded in other liabilities in the consolidated balance sheets. We incurred $31,000 in losses due to repurchase, indemnification and make-whole obligations during the year ended December 31, 2017 compared to none in 2016. |
Goodwill and Other Intangible Assets |
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Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets Goodwill and other intangible assets at December 31, 2017 and 2016 are summarized as follows (in thousands):
Amortization expense related to intangible assets totaled $472,000 in 2017, $448,000 in 2016 and $628,000 in 2015. The estimated aggregate future amortization expense for intangible assets remaining as of December 31, 2017 is as follows (in thousands):
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Premises and Equipment |
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Premises and Equipment | Premises and Equipment Premises and equipment at December 31, 2017 and 2016 are summarized as follows (in thousands):
Depreciation expense for the above premises and equipment was approximately $6.9 million, $6.0 million and $4.6 million in 2017, 2016 and 2015, respectively. |
Deposits |
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Deposits [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Deposits | Deposits Deposits at December 31, 2017 and 2016 were as follows (in thousands):
The scheduled maturities of interest-bearing time deposits were as follows at December 31, 2017 (in thousands):
At December 31, 2017 and 2016, the Bank had approximately $13.5 million and $15.4 million, respectively, in deposits from related parties, including directors, stockholders and their affiliates. At December 31, 2017 and 2016, interest-bearing time deposits of $250,000 or more were approximately $300.5 million and $225.5 million, respectively. |
Borrowing Arrangements |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Borrowing Arrangements | Borrowing Arrangements The following table summarizes our borrowings at December 31, 2017, 2016 and 2015 (in thousands):
The following table summarizes our other borrowing capacities net of balances outstanding at December 31, 2017, 2016 and 2015 (in thousands):
Our unsecured, revolving, non-amortizing line of credit has maximum availability of $130.0 million, matured on December 19, 2017 and was renewed on December 19, 2017 with a maturity date of December 18, 2018. The loan proceeds may be used for general corporate purposes including funding regulatory capital infusions into the Bank. The loan agreement contains customary financial covenants and restrictions. There were no borrowings outstanding as of December 31, 2017 or December 31, 2016. We did not borrow against this line of credit during the year ended December 31, 2017. The average borrowings during the year ended December 31, 2016 were $6.8 million. The scheduled maturities of our borrowings at December 31, 2017, excluding accrued interest, were as follows (in thousands):
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Long-Term Debt |
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Subordinated Borrowings [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Long-Term Debt | Long-Term Debt From November 2002 to September 2006 various Texas Capital Statutory Trusts were created and subsequently issued floating rate trust preferred securities in various private offerings totaling $113.4 million. As of December 31, 2017, the details of the trust preferred subordinated debentures are summarized below (dollars in thousands):
On September 21, 2012, we issued $111.0 million of subordinated notes. The notes mature in September 2042 and bear interest at a rate of 6.50% per annum, payable quarterly. The indenture governing the notes contains customary covenants and restrictions. On January 31, 2014, the Bank issued $175.0 million of subordinated notes in an offering to institutional investors exempt from registration under Section 3(a)(2) of the Securities Act of 1933 and 12 C.F.R. Part 16. The notes mature in January 2026 and bear interest at a rate of 5.25% per annum, payable semi-annually. The notes are unsecured and are subordinate to the Bank’s obligations to its depositors, its obligations under banker’s acceptances and letters of credit, certain obligations to Federal Reserve Banks and the FDIC and the Bank’s obligations to its other creditors, except any obligations which expressly rank on a parity with or junior to the notes. The notes qualify as Tier 2 capital for regulatory capital purposes, subject to applicable limitations. Interest payments on all long-term debt are deductible for federal income tax purposes. |
Income Taxes |
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Income Tax Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Taxes | Income Taxes The Tax Cut and Jobs Act (the "Tax Act") enacted in December 2017 reduced the federal corporate income tax rate from 35% to 21% effective January 1, 2018. As a result of the Tax Act, we recorded a $17.6 million write-off of our net deferred tax asset, which was recorded as additional income tax expense during 2017. We reported gross deferred tax assets of $63.0 million and $89.7 million at December 31, 2017 and 2016, respectively, which related primarily to our allowance for loan losses, loan origination fees and stock compensation. Management believes it is more likely than not that all of the deferred tax assets will be realized. Our net deferred tax assets are included in other assets in the consolidated balance sheets. Income tax expense/(benefit) consists of the following for the years ended (in thousands):
The tax effect of unrealized gains and losses on available-for-sale securities is recorded to other comprehensive income and is not a component of income tax expense/(benefit). Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The table below summarizes significant components of our deferred tax assets and liabilities utilizing federal corporate income tax rates of 21% as of December 31, 2017 and 35% as of December 31, 2016 (in thousands):
We remeasured certain deferred tax assets and liabilities based on the rates at which they are expected to reverse in the future, which is generally 21%. However, we are still analyzing certain aspects of the Tax Act and refining our calculations, which could potentially affect the measurement of these balances or potentially give rise to new deferred tax amounts. The provisional amount recorded related to the remeasurement of our deferred tax asset was $17.6 million. ASC 740-10, Income Taxes — Accounting for Uncertainties in Income Taxes (“ASC 740-10”) prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. Benefits from tax positions should be recognized in the financial statements only when it is more likely than not that the tax position will be sustained upon examination by the appropriate taxing authority that would have full knowledge of all relevant information. A tax position that meets the more-likely-than-not recognition threshold is measured at the largest amount of cumulative benefit that is greater than fifty percent likely of being realized upon ultimate settlement. Tax positions that previously failed to meet the more-likely-than-not recognition threshold are recognized in the first subsequent financial reporting period in which that threshold is met. Previously recognized tax positions that no longer meet the more-likely-than-not recognition threshold are derecognized in the first subsequent financial reporting period in which that threshold is no longer met. ASC 740-10 also provides guidance on the accounting for and disclosure of unrecognized tax benefits, interest and penalties. We file income tax returns in the U.S. federal jurisdiction and several U.S. state jurisdictions. We are no longer subject to U.S. federal income tax examinations for years before 2014. The reconciliation of our effective income tax rate to the U.S. federal statutory tax rate is as follows:
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Stock-Based Compensation and Employee Benefits |
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Compensation Related Costs [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-Based Compensation and Employee Benefits | Stock-Based Compensation and Employee Benefits We have a qualified retirement plan, with a salary deferral feature designed to qualify under Section 401 of the Internal Revenue Code (“the 401(k) Plan”). The 401(k) Plan permits our employees to defer a portion of their compensation. Matching contributions may be made in amounts and at times determined by the Company. We contributed approximately $8.4 million, $6.8 million, and $6.3 million for the years ended December 31, 2017, 2016 and 2015, respectively. Employees are eligible to participate in the 401(k) Plan when they meet certain requirements concerning minimum age and period of credited service. All contributions to the 401(k) Plan are invested in accordance with participant elections among certain investment options. During 2000, we implemented an Employee Stock Purchase Plan (“ESPP”). Employees are eligible for the plan when they meet certain requirements concerning period of credited service and minimum hours worked. Eligible employees may contribute a minimum of 1% to a maximum of 10% of eligible compensation up to the Section 423 of the Internal Revenue Code limit of $25,000. In 2006, stockholders approved the 2006 ESPP, which allocated 400,000 shares for purchase. As of December 31, 2017, 2016 and 2015, 132,285, 124,572 and 113,910 shares had been purchased on behalf of the employees under the 2006 ESPP. We have stock-based compensation plans under which equity-based compensation grants are made by the board of directors, or its designated committee. Grants are subject to vesting requirements. Under the plans, we may grant, among other things, non-qualified stock options, incentive stock options, restricted stock, restricted stock units (“RSUs”), stock appreciation rights (“SARs”), cash-based performance units or any combination thereof to employees and non-employee directors. A total of 2,550,000 shares are authorized for grant under the plans. Total shares remaining available for grant under the plans at December 31, 2017 were 2,169,324. We also offer a non-qualified deferred compensation plan for our executives and key members of management in order to assist us in attracting and retaining these individuals. Participants in the plan may elect to defer up to 75% of their annual salary and/or short-term incentive payout into deferral accounts that mirror the gains or losses of investments selected by the participants. The plan allows us to make discretionary contributions on behalf of a participant as well as matching contributions. We made discretionary contributions of $260,000 in 2017 compared to none in 2016. No matching contributions were made in 2017 or 2016. All participant contributions to the plan and any related earnings are immediately vested and may be withdrawn upon the participant's separation from service, death or disability or upon a date specified by the participant. The deferrals are recorded to salaries and benefits as a reduction and a corresponding accrual is recorded in other liabilities. A summary of our SAR activity and related information for 2017, 2016 and 2015 is as follows. These rights are time based and generally vest ratably over a period of five years.
A summary of our RSU activity and related information for 2017, 2016 and 2015 is as follows. Grants of RSUs include both performance-based and time-based vesting conditions and generally vest over a three-year period.
In 2016, we began granting shares of restricted stock ("RSAs"). A summary of our restricted stock activity and related information for 2017 and 2016 is as follows. These restricted shares are time-vested and generally vest ratably over a period of five years.
Total compensation cost for all share-based arrangements, net of taxes, was $5.3 million, $3.3 million and $3.0 million for the years ended December 31, 2017, 2016 and 2015, respectively. We granted a total of 121,260 cash-based performance units in 2017, with a total of 390,350 outstanding at December 31, 2017 all of which are time-based and vest ratably over a period of four years. We granted a total of 224,071 and 146,153 cash-based performance units in 2016 and 2015. Since these units have a cash payout feature, they are accounted for under the liability method and the related expense is based on the stock price at period end. Compensation cost for the units was $13.9 million, $8.5 million and $7.7 million for the years ended December 31, 2017, 2016 and 2015 respectively. At December 31, 2017, the weighted average remaining contractual life of the units was 7.97 years. Total compensation cost for all cash-based arrangements, net of taxes, for the years ended December 31, 2017, 2016 and 2015 was $9.1 million, $5.5 million and $5.0 million, respectively. |
Financial Instruments with Off-Balance Sheet Risk |
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Risks and Uncertainties [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||
Financial Instruments with Off-Balance Sheet Risk | Financial Instruments with Off-Balance Sheet Risk The Bank is a party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments include commitments to extend credit and standby letters of credit that involve varying degrees of credit risk in excess of the amount recognized in the consolidated balance sheets. The Bank’s exposure to credit loss in the event of non-performance by the other party to the financial instrument for commitments to extend credit and standby letters of credit is represented by the contractual amount of these instruments. The Bank uses the same credit policies in making commitments and conditional obligations as it does for on-balance sheet instruments. The amount of collateral obtained, if deemed necessary, is based on management’s credit evaluation of the borrower. Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Since many of the commitments may expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. The Bank evaluates each customer’s credit-worthiness on a case-by-case basis. Standby letters of credit are conditional commitments issued by the Bank to guarantee the performance of a customer to a third party. Those guarantees are primarily issued to support public and private borrowing arrangements. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan facilities to customers. At December 31, 2017 and 2016, commitments to extend credit and standby and commercial letters of credit were as follows (in thousands):
At December 31, 2017 and 2016, we had $9.1 million and $11.4 million, respectively, in allowance for off-balance sheet credit losses related to these off-balance sheet commitments recorded in other liabilities in the consolidated balance sheets. |
Regulatory Restrictions |
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Regulatory Capital Requirements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Regulatory Restrictions | Regulatory Restrictions The Company and the Bank are subject to various regulatory capital requirements administered by the federal banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory (and possibly additional discretionary) actions by regulators that, if undertaken, could have a direct material effect on the Company’s and the Bank’s financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Company and the Bank must meet specific capital guidelines that involve quantitative measures of the Company’s and the Bank’s assets, liabilities, and certain off-balance sheet items as calculated under regulatory accounting practices. The Company’s and the Bank’s capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings and other factors. The Basel III regulatory capital framework (the "Basel III Capital Rules") adopted by U.S. federal regulatory authorities, among other things, (i) establishes the capital measure called "Common Equity Tier 1" ("CET1"), (ii) specifies that Tier 1 capital consist of CET1 and "Additional Tier 1 Capital" instruments meeting stated requirements, (iii) requires that most deductions/adjustments to regulatory capital measures be made to CET1 and not to the other components of capital and (iv) defines the scope of the deductions/adjustments to the capital measures. The Basel III Capital Rules became effective for us on January 1, 2015 with certain transition provisions fully phasing in over a period ending on January 1, 2019. Additionally, the Basel III Capital Rules require that we maintain a capital conservation buffer with respect to each of the CET1, Tier 1 and total capital to risk-weighted assets, which provides for capital levels that exceed the minimum risk-based capital adequacy requirements. The capital conservation buffer is subject to a three year phase-in period that began on January 1, 2016 and will be fully phased-in on January 1, 2019 at 2.5%. The required phase-in capital conservation buffer during 2017 was 1.25%. A financial institution with a conservation buffer of less than the required amount is subject to limitations on capital distributions, including dividend payments and stock repurchases, and certain discretionary bonus payments to executive officers. Quantitative measures established by regulation to ensure capital adequacy require the Company and the Bank to maintain minimum amounts and ratios of CET1, Tier 1 and total capital to risk-weighted assets, and of Tier 1 capital to average assets, each as defined in the regulations. Management believes, as of December 31, 2017, that the Company and the Bank meet all capital adequacy requirements to which they are subject. Financial institutions are categorized as well capitalized or adequately capitalized, based on minimum total risk-based, Tier 1 risk-based, CET1 and Tier 1 leverage ratios. As shown in the table below, the Company’s capital ratios exceeded the regulatory definition of adequately capitalized as of December 31, 2017 and 2016. Based upon the information in its most recently filed call report, the Bank met the capital ratios necessary to be well capitalized. The regulatory authorities can apply changes in classification of assets and such changes may retroactively subject the Company to changes in capital ratios. Any such change could reduce one or more capital ratios below well-capitalized status. In addition, a change may result in imposition of additional assessments by the FDIC or could result in regulatory actions that could have a material effect on condition and results of operations. Because our Bank had less than $15.0 billion in total consolidated assets as of December 31, 2009, we are allowed to continue to classify our trust preferred securities, all of which were issued prior to May 19, 2010, as Tier 1 capital. The table below summarizes our actual and required capital ratios under the Basel III Capital Rules (dollars in thousands):
Our mortgage finance loan volumes can increase significantly at month-end, causing a meaningful difference between ending balance and average balance for any period. At December 31, 2017, our total mortgage finance loans were $5.3 billion compared to the average for the year ended December 31, 2017 of $4.1 billion. As CET1, Tier 1 and total capital ratios are calculated using quarter-end risk-weighted assets and our mortgage finance loans are 100% risk-weighted (excluding MCA mortgage loans held for sale, which receive lower risk weights), the quarter-end fluctuation in these balances can significantly impact our reported ratios. Due to the actual risk profile and liquidity of this asset class, we manage capital allocated to mortgage finance loans based on changing trends in average balances and do not believe that the quarter-end balance is representative of risk characteristics that would justify higher allocations. However, we monitor our capital allocation to confirm that all capital levels remain above well-capitalized levels. Dividends that may be paid by banks are routinely restricted by various regulatory authorities. The amount that can be paid in any calendar year without prior approval of our Bank’s regulatory agencies cannot exceed the lesser of the net profits (as defined) for that year plus the net profits for the preceding two calendar years, or retained earnings. The Basel III Capital Rules further limit the amount of dividends that may be paid by our Bank. No dividends were declared or paid on our common stock during 2017, 2016 or 2015. The required reserve balances at the Federal Reserve at December 31, 2017 and 2016 were approximately $197.3 million and $221.9 million, respectively. |
Earnings Per Share |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share | Earnings Per Share The following table presents the computation of basic and diluted earnings per share (in thousands except share data):
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Fair Value Disclosures |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures | Fair Value Disclosures We determine the fair market values of our assets and liabilities measured at fair value on a recurring and nonrecurring basis using the fair value hierarchy as prescribed in ASC 820, Fair Value Measurements and Disclosures. The standard describes three levels of inputs that may be used to measure fair value as provided below.
Assets and liabilities measured at fair value at December 31, 2017 and 2016 are as follows (in thousands):
Level 3 Valuations Financial instruments are considered Level 3 when their values are determined using pricing models, discounted cash flow methodologies or similar techniques and at least one significant model assumption or input is unobservable. Level 3 financial instruments also include those for which the determination of fair value requires significant management judgment or estimation. Currently, we measure fair value for certain loans and OREO on a nonrecurring basis as described below. Loans held for investment During the years ended December 31, 2017 and 2016, certain impaired loans held for investment were re-evaluated and reported at fair value through a specific valuation allowance allocation of the allowance for loan losses based upon the fair value of the underlying collateral. The $21.2 million total above includes impaired loans at December 31, 2017 with a carrying value of $32.2 million that were reduced by specific valuation allowance allocations totaling $11.0 million for a total reported fair value of $21.2 million based on collateral valuations utilizing Level 3 valuation inputs. The $52.3 million total above includes impaired loans at December 31, 2016 with a carrying value of $74.1 million that were reduced by specific valuation allowance allocations totaling $21.8 million for a total reported fair value of $52.3 million based on collateral valuations utilizing Level 3 valuation inputs. Fair values were based on third party appraisals. OREO Certain foreclosed assets, upon initial recognition, are recorded at fair value less estimated selling costs. At December 31, 2017 and 2016, OREO had a carrying value of $11.7 million and $19.0 million, respectively, with no specific valuation allowance. The fair value of OREO was computed based on third party appraisals, which are Level 3 valuation inputs. Fair Value of Financial Instruments Generally accepted accounting principles require disclosure of fair value information about financial instruments, whether or not recognized on the balance sheet, for which it is practical to estimate that value. In cases where quoted market prices are not available, fair values are based on estimates using present value or other valuation techniques. Those techniques are significantly affected by the assumptions used, including the discount rate and estimates of future cash flows. This disclosure does not and is not intended to represent the fair value of the Company. A summary of the carrying amounts and estimated fair values of financial instruments is as follows (in thousands):
The following methods and assumptions were used by the Company in estimating its fair value disclosures for financial instruments: Cash and cash equivalents The carrying amounts reported in the consolidated balance sheets for cash and cash equivalents approximate their fair value, and these financial instruments are characterized as Level 1 assets in the fair value hierarchy. Securities available-for-sale Within the securities available-for-sale portfolio, we hold equity securities related to our non-qualified deferred compensation plan which are valued using quoted market prices for identical equity securities in an active market. These financial instruments are classified as Level 1 assets in the fair value hierarchy. The fair value of the remaining investment portfolio is based on prices obtained from independent pricing services which are based on quoted market prices for the same or similar securities, and these financial instruments are characterized as Level 2 assets in the fair value hierarchy. We have obtained documentation from the primary pricing service we use about their processes and controls over pricing. In addition, on a quarterly basis we independently verify the prices that we receive from the service provider using two additional independent pricing sources. Any significant differences are investigated and resolved. Loans held for sale Fair value for loans held for sale is derived from quoted market prices for similar loans, and these financial instruments are characterized as Level 2 assets in the fair value hierarchy. Loans held for investment, net Loans held for investment are characterized as Level 3 assets in the fair value hierarchy. For variable-rate loans held for investment that reprice frequently with no significant change in credit risk, fair values are generally based on carrying values. The fair value for all other loans held for investment is estimated using discounted cash flow analyses, using interest rates currently being offered for loans with similar terms to borrowers of similar credit quality. The carrying amount of accrued interest approximates its fair value. Derivatives The estimated fair value of the interest rate swaps and caps is obtained from independent pricing services based on quoted market prices for similar derivative contracts and these financial instruments are characterized as Level 2 assets and liabilities in the fair value hierarchy. On a quarterly basis, we independently verify the fair value using an additional independent pricing source. Any significant differences are investigated and resolved. Foreign currency forward contracts are valued based upon quoted market prices obtained from independent pricing services for similar derivative contracts. As such, these financial instruments are characterized as Level 2 assets and liabilities in the fair value hierarchy. The derivative instruments related to the loans held for sale portfolio include loan purchase commitments and forward sales commitments. Loan purchase commitments are valued based upon the fair value of the underlying mortgage loans to be purchased, which is based on observable market data for similar loans. Forward sales commitments are valued based upon the quoted market prices from brokers. As such, these loan purchase commitments and forward sales commitments are classified as Level 2 assets or liabilities in the fair value hierarchy. Deposits Deposits are characterized as Level 3 liabilities in the fair value hierarchy. The carrying amounts for variable-rate money market accounts approximate their fair value. The fair value of fixed-term certificates of deposit are estimated using a discounted cash flow calculation that applies interest rates currently being offered on certificates to a schedule of aggregated expected monthly maturities. Federal funds purchased, customer repurchase agreements, other borrowings, subordinated notes and trust preferred subordinated debentures The carrying value reported in the consolidated balance sheets for Federal funds purchased, customer repurchase agreements and other short-term, floating rate borrowings approximates their fair value, and these financial instruments are characterized as Level 2 liabilities in the fair value hierarchy. The fair value of any fixed rate short-term borrowings and trust preferred subordinated debentures are estimated using a discounted cash flow calculation that applies interest rates currently being offered on similar borrowings, and these financial instruments are characterized as Level 3 liabilities in the fair value hierarchy. The subordinated notes are publicly, though infrequently, traded and are valued based on market prices, and are characterized as Level 2 liabilities in the fair value hierarchy. |
Commitments and Contingencies |
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Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||
Commitments and Contingencies | Commitments and Contingencies We lease various premises under operating leases with various expiration dates extending through April 2027. Rent expense incurred under operating leases totaled approximately $15.3 million, $13.9 million and $15.3 million for the years ended December 31, 2017, 2016 and 2015, respectively. Minimum future lease payments under operating leases are as follows (in thousands):
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Parent Company Only |
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Condensed Financial Information of Parent Company Only Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Parent Company Only | Parent Company Only Summarized financial information for Texas Capital Bancshares, Inc. – Parent Company Only follows (in thousands): Balance Sheet
Statement of Earnings
Statements of Cash Flows
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Related Party Transactions |
12 Months Ended |
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Dec. 31, 2017 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions See Note 8 for a description of deposits from related parties. |
Derivative Financial Instruments |
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Financial Instruments | Derivative Financial Instruments The fair value of derivative positions outstanding is included in accrued interest receivable and other assets and other liabilities in the accompanying consolidated balance sheets on a net basis when a right of offset exists, based on transactions with a single counterparty that are subject to a legally enforceable master netting agreement. We enter into interest rate derivative contracts that are not designated as hedging instruments. These derivative positions relate to transactions in which we enter into an interest rate swap, cap and/or floor with a customer while at the same time entering into an offsetting interest rate swap, cap and/or floor with another financial institution. In connection with each swap transaction, we agree to pay interest to the customer on a notional amount at a variable interest rate and receive interest from the customer on a similar notional amount at a fixed interest rate. At the same time, we agree to pay another financial institution the same fixed interest rate on the same notional amount and receive the same variable interest rate on the same notional amount. The transaction allows our customer to effectively convert a variable rate loan to a fixed rate. Because we act as an intermediary for our customer, changes in the fair value of the underlying derivative contracts substantially offset each other and do not have a material impact on our results of operations. We also enter into foreign currency forward contracts that are not designed as hedging instruments. These derivative instruments relate to transactions in which we enter into a contract with a customer to buy or sell a foreign currency at a future date for a specified price while at the same time entering into an offsetting contract with a financial institution to buy or sell the same currency at the same future date for a specified price. These transactions allow our customers to manage their exposure to foreign currency exchange rate fluctuations. We also enter into loan purchase commitment contracts with mortgage originators to purchase residential mortgage loans at a future date, as well as forward sales commitment contracts to sell residential mortgage loans at a future date as part of our MCA program. The objective of these transactions is to mitigate our exposure to interest rate risk associated with the purchase of mortgage loans held for sale. The notional amounts and estimated fair values of derivative positions outstanding at December 31, 2017 and 2016 are presented in the following table (in thousands):
The weighted-average receive and pay interest rates for interest rate swaps outstanding at December 31, 2017 and 2016 were as follows:
The weighted-average strike rate for outstanding interest rate caps was 2.40% at December 31, 2017 and 2.45% at December 31, 2016. Our credit exposure on derivative instruments is limited to the net favorable value and interest payments by each counterparty. In such cases collateral may be required from the counterparties involved if the net value of the derivative instruments exceed a nominal amount considered to be immaterial. Our credit exposure associated with these instruments was approximately $16.7 million at December 31, 2017 and approximately $37.9 million at December 31, 2016, which primarily relates to transactions with Bank customers. Collateral levels are monitored and adjusted on a regular basis for changes in interest rate swap and cap values, as well as forward sales commitments. At December 31, 2017, we had $15.2 million in cash collateral pledged for these derivatives, of which $14.0 million was included in interest-bearing deposits and $1.2 million was included in accrued interest receivable and other assets. At December 31, 2016, we had $24.8 million in cash collateral pledged for these derivatives, all of which was included in interest-bearing deposits. We also enter into credit risk participation agreements with financial institution counterparties for interest rate swaps related to loans in which we are either a participant or a lead bank. The risk participation agreements entered into by us as a participant bank provide credit protection to the financial institution counterparty should the borrower fail to perform on its interest rate derivative contract with that financial institution. We have 15 risk participation agreements where we are a participant bank with a notional amount of $157.1 million at December 31, 2017. The maximum estimated exposure to these agreements, assuming 100% default by all obligors, was approximately $221,000 at December 31, 2017. The fair value of these exposures was insignificant to the consolidated financial statements. Risk participation agreements entered into by us as the lead bank provide credit protection to us should the borrower fail to perform on its interest rate derivative contract with us. We have 10 risk participation agreements where we are the lead bank with a notional amount of $86.3 million at December 31, 2017. |
Stockholder's Equity |
12 Months Ended |
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Dec. 31, 2017 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity | Stockholders’ Equity On December 2, 2016, we completed a sale of 3.45 million shares of our common stock in a public offering. Net proceeds from the sale totaled $236.4 million. The additional equity was used for general corporate purposes, including repayment of $20.0 million of short-term debt and as additional capital to support continued loan growth. |
Quarterly Financial Data |
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Selected Quarterly Financial Information [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Quarterly Financial Information | Quarterly Financial Data (unaudited) The tables below summarize our quarterly financial information for the years December 31, 2017 and 2016 (in thousands except per share and average share data):
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New Accounting Standards |
12 Months Ended |
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Dec. 31, 2017 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
New Accounting Standards | New Accounting Standards ASU 2017-12, “Derivatives and Hedging (Topic 815) - Targeted Improvements to Accounting for Hedging Activities” ("ASU 2017-12") amends the hedge accounting recognition and presentation requirements in ASC 815 to improve the transparency and understandability of information conveyed to financial statement users about an entity’s risk management activities to better align the entity’s financial reporting for hedging relationships with those risk management activities and to reduce the complexity of and simplify the application of hedge accounting. ASU 2017-12 will be effective for us on January 1, 2019 and is not expected to have a significant impact on our consolidated financial statements. ASU 2017-09 "Compensation - Stock Compensation (Topic 718): Scope of Modification Accounting" ("ASU 2017-09") clarifies when changes to the terms or conditions of a share-based payment must be accounted for as modifications. Under ASU 2017-09, an entity should account for changes to the terms or conditions of a share-based payment as a modification unless all of the following are met: 1) the fair value of the modified award is the same as the fair value of the original award immediately before modification, 2) the vesting conditions of the modified award are the same as the vesting conditions of the original award immediately before modification and 3) the classification of the modified award as an equity instrument or a liability instrument is the same as the classification of the original award immediately before modification. ASU 2017-09 will be effective for us on January 1, 2018, and is not expected to have a significant impact on our consolidated financial statements. ASU 2017-04, “Intangibles - Goodwill and Other (Topic 350) - Simplifying the Test for Goodwill Impairment” ("ASU 2017-04") eliminates Step 2 from the goodwill impairment test which required entities to compute the implied fair value of goodwill. Under ASU 2017-04, an entity should perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An entity should recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. ASU 2017-04 will be effective for us on January 1, 2020, with early adoption permitted for interim or annual impairment tests beginning in 2017, and is not expected to have a significant impact on our consolidated financial statements. ASU 2016-15 "Statement of Cash Flows (Topic 230)" ("ASU 2016-15") is intended to reduce the diversity in practice around how certain transactions are classified within the statement of cash flows. ASU 2016-15 will be effective for us on January 1, 2018 and is not expected to have a significant impact on our consolidated financial statements. ASU 2016-13 "Financial Instruments - Credit Losses (Topic 326)" ("ASU 2016-13") requires an entity to utilize a new impairment model known as the current expected credit loss ("CECL") model to estimate its lifetime "expected credit loss" and record an allowance that, when deducted from the amortized cost basis of the financial asset, presents the net amount expected to be collected on the financial asset. The CECL model is expected to result in more timely recognition of credit losses. ASU 2016-13 also requires new disclosures for financial assets measured at amortized cost, loans and available-for-sale debt securities. Entities will apply the standard's provisions as a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is adopted. ASU 2016-13 will be effective for us on January 1, 2020. We are evaluating the impact adoption of ASU 2016-13 will have on our consolidated financial statements and disclosures. While we are currently unable to reasonably estimate the impact of adopting ASU 2016-13, we expect that the impact of adoption could be significantly influenced by the composition, characteristics and quality of our loan portfolio as well as the prevailing economic conditions and forecasts as of the adoption date. As part of our evaluation process, we have established a steering committee and working group that includes individuals from various functional areas to assess processes, portfolio segmentation, systems requirements and needed resources to implement this new accounting standard. ASU 2016-02 "Leases (Topic 842)" ("ASU 2016-02") requires that lessees and lessors recognize lease assets and lease liabilities on the balance sheet and disclose key information about leasing arrangements. ASU 2016-02 will be effective for us on January 1, 2019. ASU 2016-02 provides for a modified retrospective transition approach requiring lessees to recognize and measure leases on the balance sheet at the beginning of the earliest period presented with the option to elect certain practical expedients. We are currently evaluating a third party software solution to assist with the accounting under the new standard. Our operating leases relate primarily to office space and bank branches. We expect recorded assets and liabilities to increase upon adoption of the standard as it relates to operating leases in which we are the lessee. See Note 17 - Commitments and Contingencies for a summary of minimum future lease payments under operating leases as of December 31, 2017. ASU 2016-01, "Financial Instruments - Overall (Subtopic 825-10): Recognition of Financial Assets and Financial Liabilities," ("ASU 2016-01") makes targeted amendments to the guidance for recognition, measurement, presentation and disclosure of financial instruments. ASU 2016-01 will be effective for us on January 1, 2018. ASU 2016-01 requires equity investments, other than equity method investments, to be measured at fair value with changes in fair value recognized in net income. At adoption, any cumulative change in the fair value of these equity securities previously recognized in accumulated other comprehensive income will be recorded as an adjustment to the opening balance of retained earnings, and any further changes to their fair value will be recorded in net income. We do not expect the new guidance to have a material impact on our consolidated financial statements. ASU 2016-01 also emphasizes the existing requirement to use exit prices to measure fair value for disclosure purposes and clarifies that entities should not make use of practicability exception in determining the fair value of loans. Accordingly, we will refine the calculation used to determine the disclosed fair value of our loans held for investment portfolio as part of adopting the standard. ASU 2014-09 "Revenue from Contracts with Customers (Topic 606)" ("ASU 2014-09") implements a common revenue standard that clarifies the principles for recognizing revenue. The core principle of ASU 2014-09 is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. ASU 2014-09 establishes a five-step model which entities must follow to recognize revenue and removes inconsistencies and weaknesses in existing guidance. The guidance does not apply to revenue associated with financial instruments, including loans and securities that are accounted for under other GAAP, which comprises a significant portion of our revenue stream. We will adopt ASU 2014-09 effective January 1, 2018 and expect adoption to have no material effect on how we recognize revenue. We also anticipate adoption to have no material impact to our consolidated financial statements and disclosures. |
Operations and Summary of Significant Accounting Policies (Policies) |
12 Months Ended |
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Dec. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Nature of Business | Organization and Nature of Business Texas Capital Bancshares, Inc. (the "Company”), a Delaware corporation, was incorporated in November 1996 and commenced banking operations in December 1998. The consolidated financial statements of the Company include the accounts of Texas Capital Bancshares, Inc. and its wholly owned subsidiary, Texas Capital Bank, National Association (the "Bank”). We are primarily a secured lender and serve the needs of commercial businesses and successful professionals and entrepreneurs located in Texas as well as operate several lines of business serving a regional or national clientèle of commercial borrowers. We are primarily a secured lender, with our greatest concentration of loans in Texas. |
Basis of Presentation | Basis of Presentation Our accounting and reporting policies conform to accounting principles generally accepted in the United States ("GAAP") and to generally accepted practices within the banking industry. Certain prior period balances have been reclassified to conform to the current period presentation. In that regard, ASU 2016-09, "Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting," ("ASU 2016-09") became effective for us on January 1, 2017. ASU 2016-09 requires that excess tax benefits and deficiencies be recognized as a component of income taxes within the income statement. Additionally, ASU 2016-09 requires that all income tax-related cash flows resulting from share-based payments be reported as operating activities in the statement of cash flows. Previously, income tax benefits at award settlement were reported as a reduction to operating cash flows and an increase to financing cash flows to the extent that those benefits exceeded the income tax benefits reported in earnings during the award's vesting period. We have elected to apply that change in cash flow presentation on a prospective basis. ASU 2016-09 also requires that companies make an accounting policy election regarding forfeitures, to either estimate the number of awards that are expected to vest or account for them when they occur. We have elected to recognize forfeitures as they occur. The impact of this change and that of the remaining provisions of ASU 2016-09 did not have a significant impact on our financial statements. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements. Actual results could differ from those estimates. The allowance for loan losses, the allowance for off-balance sheet credit losses, the fair value of stock-based compensation awards, the fair value of mortgage servicing rights ("MSRs"), the fair value of financial instruments and the status of contingencies are particularly susceptible to significant change. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash equivalents include amounts due from banks, interest-bearing deposits and Federal funds sold. |
Securities | Securities Securities are classified as trading, available-for-sale or held-to-maturity. Management classifies securities at the time of purchase and re-assesses such designation at each balance sheet date; however, transfers between categories from this re-assessment are rare. Trading Account Securities acquired for resale in anticipation of short-term market movements are classified as trading, with realized and unrealized gains and losses recognized in income. To date, we have not had any activity in our trading account. Available-for-Sale Debt securities are classified as held-to-maturity when we have the positive intent and ability to hold the securities to maturity. Held-to-maturity securities are stated at amortized cost. Debt securities not classified as held-to-maturity or trading and marketable equity securities not classified as trading are classified as available-for-sale. Available-for-sale securities are stated at fair value, with the unrealized gains and losses reported in a separate component of accumulated other comprehensive income (loss), net of tax. The amortized cost of debt securities is adjusted for amortization of premiums and accretion of discounts to maturity, or in the case of mortgage-backed securities, over the estimated life of the security. Such amortization and accretion is included in interest income from securities. Realized gains and losses and declines in value judged to be other-than-temporary are included in gain (loss) on sale of securities. The cost of securities sold is based on the specific identification method. All securities are available-for-sale as of December 31, 2017 and 2016. |
Loans | Loans Loans Held for Sale Through our MCA program, we commit to purchase residential mortgage loans from independent correspondent lenders and deliver those loans into the secondary market via whole loan sales to independent third parties or in securitization transactions to third parties such as Ginnie Mae or to GSEs such as Fannie Mae or Freddie Mac. In some cases, we retain the mortgage servicing rights. Once purchased, these loans are classified as held for sale and are carried at fair value pursuant to our election of the fair value option in accordance with Accounting Standards Codification 825, Financial Instruments ("ASC 825"). At the commitment date, we enter into a corresponding forward sale commitment with a third party, typically Ginnie Mae or a GSE, to deliver the loans within a specified timeframe. The estimated gain/loss for the entire transaction (from initial purchase commitment to final delivery of loans) is recorded as an asset or liability. Fair value is derived from observable current market prices, when available, and includes the fair value of the mortgage servicing rights. Adjustments to reflect unrealized gains and losses resulting from changes in fair value and realized gains and losses upon ultimate sale of the loans are classified as other non-interest income in the consolidated statements of income and other comprehensive income. Pursuant to Ginnie Mae servicing guidelines, we have the unilateral right, but not the obligation, to repurchase certain delinquent loans securitized in Ginnie Mae pools, if they meet defined delinquent loan criteria. Once the delinquency criteria have been met, and regardless of whether the repurchase option has been exercised, we account for these loans as if they had been repurchased and recognize the loans and a corresponding liability as held for sale and other liabilities, respectively, in the consolidated balance sheets. If the loans are actually repurchased, the liability is cash settled and the loans continue to be reported as held for sale. As an approved lender, we may collect losses incurred on repurchased loans through a claims process with the government agency. Loans Held for Investment Loans held for investment (which include equipment leases accounted for as financing leases) are stated at the amount of unpaid principal reduced by deferred income (net of costs). Interest on loans is recognized using the simple-interest method on the daily balances of the principal amounts outstanding. Loan origination fees, net of direct loan origination costs, and commitment fees, are deferred and amortized as an adjustment to yield over the life of the loan, or over the commitment period, as applicable. A loan held for investment is considered impaired when, based on current information and events, it is probable that we will be unable to collect all amounts due (both principal and interest) according to the terms of the loan agreement. Reserves on impaired loans are measured based on the present value of expected future cash flows discounted at the loan’s effective interest rate or the fair value of the underlying collateral, less cost to sell. Impaired loans, or portions thereof, are charged off when a confirmed loss exists. The accrual of interest on loans is discontinued when there is a clear indication that the borrower’s cash flow may not be sufficient to meet payments as they become due, which is generally when a loan is 90 days past due. When a loan is placed on non-accrual status, all previously accrued and unpaid interest is reversed. Interest income is subsequently recognized on a cash basis as long as the remaining book balance of the asset is deemed to be collectible. If collectability is questionable, then cash payments are applied to principal. A loan is placed back on accrual status when both principal and interest are current and it is probable that we will be able to collect all amounts due (both principal and interest) according to the terms of the loan agreement. Loans held for investment includes legal ownership interests in mortgage loans that we purchase through our mortgage warehouse lending division. The ownership interests are purchased from unaffiliated mortgage originators who are seeking additional funding through sale of the undivided ownership interests to facilitate their ability to originate loans. The mortgage originator has no obligation to offer and we have no obligation to purchase these interests. The originator closes mortgage loans consistent with underwriting standards established by approved investors, and, at the time of the sale to the investor, our ownership interest and that of the originator are delivered by us to the investor selected by the originator and approved by us. We typically purchase up to a 99% ownership interest in each mortgage with the originator owning the remaining percentage. These mortgage ownership interests are generally held by us for a period of less than 30 days and more typically 10-20 days. Because of conditions in agreements with originators designed to reduce transaction risks, under ASC 860, Transfers and Servicing of Financial Assets (“ASC 860”), the ownership interests do not qualify as participating interests. Under ASC 860, the ownership interests are deemed to be loans to the originators and payments we receive from investors are deemed to be payments made by or on behalf of the originator to repay the loan deemed made to the originator. Because we have an actual, legal ownership interest in the underlying residential mortgage loan, these interests are not extensions of credit to the originators that are secured by the mortgage loans as collateral. Due to market conditions or events of default by the investor or the originator, we could be required to purchase the remaining interests in the mortgage loans and hold them beyond the expected 10-20 days. Mortgage loans acquired under these conditions would require mark-to-market adjustments to income and could require future allocations of the allowance for loan losses or be subject to charge off in the event the loans become impaired. Mortgage loan interests purchased and disposed of as expected receive no allocation of the allowance for loan losses due to the minimal loss experience with these assets. |
Allowance for Loan Losses | Allowance for Loan Losses The allowance for loan losses is comprised of general reserves, specific reserves for impaired loans and an additional qualitative reserve based on our estimate of losses inherent in the portfolio at the balance sheet date, but not yet identified with specified loans. We regularly evaluate our allowance for loan losses to maintain an appropriate level to absorb estimated loan losses inherent in the loan portfolio. Factors contributing to the determination of the allowance include the creditworthiness of the borrower, changes in the value of pledged collateral, and general economic conditions. All loan commitments rated substandard or worse and greater than $500,000 are specifically reviewed for loss potential. For loans deemed to be impaired, a specific allocation is assigned based on the losses expected to be realized from those loans. For purposes of determining the general reserve, the portfolio is segregated by product types to recognize differing risk profiles among categories, and then further segregated by credit grades. Credit grades are assigned to all loans. Each credit grade is assigned a risk factor, or reserve allocation percentage. These risk factors are multiplied by the outstanding principal balance and risk-weighted by product type to calculate the required reserve. A similar process is employed to calculate a reserve assigned to off-balance sheet commitments, specifically unfunded loan commitments and letters of credit, and any needed reserve is recorded in other liabilities. Even though portions of the allowance may be allocated to specific loans, the entire allowance is available for any credit that, in management’s judgment, should be charged off. We have several pass credit grades that are assigned to loans based on varying levels of risk, ranging from credits that are secured by cash or marketable securities, to watch credits which have all the characteristics of an acceptable credit risk but warrant more than the normal level of monitoring. Within our criticized/classified credit grades are special mention, substandard, and doubtful. Special mention loans are those that are currently protected by the sound worth and paying capacity of the borrower, but that are potentially weak and constitute an additional credit risk. These loans have the potential to deteriorate to a substandard grade due to the existence of financial or administrative deficiencies. Substandard loans have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that we will sustain some loss if the deficiencies are not corrected. Some substandard loans are inappropriately protected by sound worth and paying capacity of the borrower and of the collateral pledged and may be considered impaired. Substandard loans can be accruing or can be on non-accrual depending on the circumstances of the individual loans. Loans classified as doubtful have all the weaknesses inherent in substandard loans with the added characteristics that the weaknesses make collection or liquidation in full highly questionable and improbable. The possibility of loss is extremely high. All doubtful loans are on non-accrual. The allowance allocation percentages assigned to each credit grade have been developed based primarily on an analysis of our historical loss rates. The allocations are adjusted for certain qualitative factors, including general economic conditions, changes in credit policies and lending standards. Changes in the trend and severity of problem loans can cause the estimation of losses to differ from past experience. In addition, the allowance considers the results of reviews performed by our Credit Review group as reflected in their confirmations of assigned credit grades within the portfolio. The portion of the allowance that is not derived by the allowance allocation percentages compensates for the uncertainty and complexity in estimating loan and lease losses including factors and conditions that may not be fully reflected in the determination and application of the allowance allocation percentages. Examples of risks that support the Bank's maintaining an additional qualitative reserve include economic uncertainties and unpredictable factors that produce losses, including those resulting from borrowers' submission of financial information or inaccurate certification of collateral values. These situations, while not common, do not necessarily correlate well with historical loss trends or general economic conditions. Our methodology used to calculate the allowance considers historical losses, however, the historical loss rates for specific product types or credit risk grades may not fully incorporate the effects of uncertainty regarding the economy or other unpredictable events. The methodology used in the periodic review of the appropriateness of the allowance, which is performed at least quarterly, is designed to be dynamic and responsive to changes in portfolio credit quality. The changes are reflected in the general allowance and in specific reserves as the collectability of classified loans is evaluated with new information. As our portfolio has matured, historical loss ratios have been closely monitored, and our reserve appropriateness relies primarily on our loss history. The review of the appropriateness of the allowance is performed by executive management and presented to the audit and risk committees of our board of directors for their review. The committees report to the board as part of the board's review on a quarterly basis of the Company's consolidated financial statements. |
Other Real Estate Owned | Other Real Estate Owned Other real estate owned (“OREO”), which is included in other assets on the consolidated balance sheet, consists of real estate that has been foreclosed. Real estate that has been foreclosed is recorded at the fair value of the real estate, less selling costs, through a charge to the allowance for loan losses, if necessary. Subsequent write-downs required for declines in value are recorded through a valuation allowance, or taken directly to the asset, charged to other non-interest expense. |
Premises and Equipment | Premises and Equipment Premises and equipment are stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of the assets, which range from three to ten years. Gains or losses on disposals of premises and equipment are included in other non-interest income in the consolidated income statements. |
Marketing and Software | Marketing and Software Marketing costs are expensed as incurred. Ongoing maintenance and enhancements of websites are expensed as incurred. Costs incurred in connection with development or purchase of internal use software are capitalized and amortized over a period not to exceed five years. Internal use software costs are included in other assets in the consolidated balance sheets. |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets Intangible assets are acquired assets that lack physical substance but can be distinguished from goodwill because of contractual or other legal rights or because the asset is capable of being sold or exchanged either on its own or in combination with a related contract, asset, or liability. Our intangible assets relate primarily to loan customer relationships. Intangible assets with definite useful lives are amortized over their estimated life. Goodwill and intangible assets are tested for impairment in October on an annual basis or whenever events or changes in circumstances indicate the carrying amount of the assets may not be recoverable from future undiscounted cash flows. If impaired, the assets are recorded at fair value. |
Segment Reporting | Segment Reporting We have determined that all of our lending divisions and subsidiaries meet the aggregation criteria of ASC 280, Segment Reporting, since all offer similar products and services, operate with similar processes, and have similar customers. |
Stock-based Compensation | Stock-based Compensation We account for all stock-based compensation transactions in accordance with ASC 718, Compensation — Stock Compensation (“ASC 718”), which requires that stock compensation transactions be recognized as compensation expense in the consolidated statement of income and other comprehensive income based on their fair values on the measurement date, which is the date of the grant. |
Accumulated Other Comprehensive Income | Accumulated Other Comprehensive Income Unrealized gains or losses on our available-for-sale securities (after applicable income tax expense or benefit) are included in accumulated other comprehensive income, net. Accumulated other comprehensive income (loss), net is reported in the accompanying consolidated statements of stockholders’ equity and consolidated statements of income and other comprehensive income. |
Income Taxes | Income Taxes The Company and its subsidiary file a consolidated federal income tax return. We utilize the liability method in accounting for income taxes. Under this method, deferred tax assets and liabilities are determined based upon the difference between the values of the assets and liabilities as reflected in the financial statements and their related tax basis using enacted tax rates in effect for the year in which the differences are expected to be recovered or settled. As changes in tax law or rates are enacted, deferred tax assets and liabilities are adjusted through the provision for income taxes. A valuation allowance is provided against deferred tax assets unless it is more likely than not that such deferred tax assets will be realized. |
Basic and Diluted Earnings Per Common Share | Basic and Diluted Earnings Per Common Share Basic earnings per common share is based on net income available to common stockholders divided by the weighted-average number of common shares outstanding during the period excluding non-vested stock. Diluted earnings per common share include the dilutive effect of stock options and non-vested stock awards granted using the treasury stock method. A reconciliation of the weighted-average shares used in calculating basic earnings per common share and the weighted average common shares used in calculating diluted earnings per common share for the reported periods is provided in Note 15 — Earnings Per Share. |
Fair Values of Financial Instruments | Fair Values of Financial Instruments ASC 820, Fair Value Measurements and Disclosures (“ASC 820”), defines fair value, establishes a framework for measuring fair value under GAAP and enhances disclosures about fair value measurements. In general, fair values of financial instruments are based upon quoted market prices, where available. If such quoted market prices are not available, fair value is based on estimates using present value or other valuation techniques. Those techniques are significantly affected by the assumptions used, including the discount rate and estimates of future cash flows. |
Mortgage Servicing Rights | Mortgage Servicing Rights Mortgage servicing rights are created by selling purchased or originated mortgage loans with servicing rights retained. We identify classes of servicing rights based upon the nature of the underlying assumptions used to value the asset along with the risks associated with the underlying asset. Based upon these criteria we have one class of MSRs, residential. Originated MSRs are recognized based on the estimated fair value of the mortgage loans and the related servicing rights at the date of sale using values derived from a valuation model managed by an independent third party. MSRs are amortized proportionally over the estimated life of the projected net servicing revenue and are periodically evaluated for impairment. MSRs are reported on the consolidated balance sheets at amortized cost, less a valuation allowance if the fair value of identified strata within the MSR portfolio are determined to have a fair value that is less than amortized cost. Loan servicing fee income represents income earned for servicing mortgage loans owned by investors and includes mortgage servicing fees and other ancillary servicing income. Servicing fees are recorded as income when earned and are reported in other non-interest income on the consolidated statements of income and other comprehensive income. For additional information on MSRs, see Note 5 - Certain Transfers of Financial Assets. |
Guarantees | The Company has undertaken certain guarantee obligations in the ordinary course of business which include liabilities with off-balance sheet risk. We consider the following arrangements to be guarantees: commitments to extend credit, standby letters of credit and indemnification agreements included within third party contractual arrangements. For additional information on commitments and contingencies, see Note 13 - Financial Instruments with Off-Balance Sheet Risk. |
Derivative Financial Instruments | Derivative Financial Instruments All contracts that satisfy the definition of a derivative are recorded at fair value in other assets and other liabilities in the consolidated balance sheets. We record the derivatives on a net basis when a right of offset exists, based on transactions with a single counterparty that are subject to a legally enforceable master netting agreement. For additional information on derivative financial instruments, see Note 20 - Derivative Financial Instruments. |
Securities (Tables) |
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Summary of securities | The following is a summary of securities (in thousands):
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Schedule of amortized cost and estimated fair value of securities | The amortized cost and estimated fair value of securities are presented below by contractual maturity (in thousands, except percentage data):
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Schedule of investment securities that have been in a continuous unrealized loss position for less or more than 12 months | The following table discloses, as of December 31, 2017 and December 31, 2016, our investment securities that have been in a continuous unrealized loss position for less than 12 months and those that have been in a continuous unrealized loss position for 12 or more months (in thousands):
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Loans and Allowance for Credit Losses (Tables) |
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Accounts, Notes, Loans and Financing Receivable, Gross, Allowance, and Net [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of loans held for investments | Loans held for investment are summarized by category as follows (in thousands):
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Schedule of the credit risk profile of loan portfolio by internally assigned grades and nonaccrual status | The following tables summarize the credit risk profile of our loan portfolio by internally assigned grades and non-accrual status as of December 31, 2017 and 2016 (in thousands):
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Schedule of activity in the reserve for loan losses by portfolio segment | Allocation of a portion of the allowance to one category of loans does not preclude its availability to absorb losses in other categories.
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Allowance for Credit Losses on Financing Receivables [Table Text Block] | The table below presents the activity in the allowance for off-balance sheet credit losses related to losses on unfunded commitments for the years ended December 31, 2017 and 2016 (in thousands). This allowance is recorded in other liabilities in the consolidated balance sheet.
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Schedule of recorded investment in loans related to each balance in the allowance for loan losses | Our recorded investment in loans as of December 31, 2017 and 2016 related to each balance in the allowance for loan losses by portfolio segment and disaggregated on the basis of our impairment methodology was as follows (in thousands):
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Schedule of impaired loans, by portfolio class | The following tables detail our impaired loans, by portfolio class, as of December 31, 2017 and 2016 (in thousands):
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Schedule of an age analysis of accruing past due loans | The table below provides an age analysis of our loans held for investment as of December 31, 2017 (in thousands):
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Schedule of loans that have been restructured | The following table provides information on how loans were modified as restructured loans during the year ended December 31, 2017 and 2016 (in thousands):
The following tables summarize, as of December 31, 2017 and 2016, loans that have been restructured during 2017 and 2016 (in thousands, except number of contracts):
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OREO and Valuation Allowance for Losses on OREO (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Real Estate Owned, Disclosure of Detailed Components [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of the activity related to OREO | The table below presents a summary of the activity related to OREO (in thousands):
When foreclosure occurs, the acquired asset is recorded at fair value less selling costs, generally based on appraised value, which may result in partial charge-off of the loan. Subsequent write-downs required for declines in value are recorded through a valuation allowance or taken directly against the asset and charged to other non-interest expense. During 2017, we recorded a $6.1 million write-down on one asset. |
Certain Transfers of Financial Assets (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Transfers and Servicing [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Loans Held-for-sale [Table Text Block] | The table below presents the unpaid principal balance of loans held for sale and related fair values at December 31, 2017 and 2016 (in thousands):
The table below presents a reconciliation of the changes in loans held for sale for the years December 31, 2017 and 2016 (in thousands):
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Schedule of Mortgage Servicing Rights Activity [Table Text Block] | We generally retain the right to service the loans sold, creating MSRs which are recorded as assets on our balance sheet. A summary of MSR activity for the years ended December 31, 2017 and 2016 is as follows (in thousands):
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Schedule of Fair Value Assumption Used to Value Mortgage Servicing Rights Retained [Table Text Block] | December 31, 2017 and December 31, 2016, management used the following assumptions to determine the fair value of MSRs:
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Schedule of Sensitivity Analysis of Fair Value, Transferor's Interests in Transferred Financial Assets [Table Text Block] | A sensitivity analysis of changes in the fair value of our MSR portfolio resulting from certain key assumptions is presented in the following table (in thousands):
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Goodwill and Other Intangible Assets (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of goodwill and other intangible assets | Goodwill and other intangible assets at December 31, 2017 and 2016 are summarized as follows (in thousands):
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Schedule of estimated aggregate future amortization expense for intangible assets | The estimated aggregate future amortization expense for intangible assets remaining as of December 31, 2017 is as follows (in thousands):
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Premises and Equipment (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property, Plant and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of premises and equipment | Premises and equipment at December 31, 2017 and 2016 are summarized as follows (in thousands):
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Deposits (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Deposits [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of deposits | Deposits at December 31, 2017 and 2016 were as follows (in thousands):
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Schedule of maturities of interest-bearing time deposits | The scheduled maturities of interest-bearing time deposits were as follows at December 31, 2017 (in thousands):
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Borrowing Arrangements (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of borrowings | The following table summarizes our borrowings at December 31, 2017, 2016 and 2015 (in thousands):
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Summary of other borrowing capacities | The following table summarizes our other borrowing capacities net of balances outstanding at December 31, 2017, 2016 and 2015 (in thousands):
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Schedule of maturities of borrowings | The scheduled maturities of our borrowings at December 31, 2017, excluding accrued interest, were as follows (in thousands):
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Long-Term Debt (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Subordinated Borrowings [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of details of the trust preferred subordinated debentures | As of December 31, 2017, the details of the trust preferred subordinated debentures are summarized below (dollars in thousands):
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Income Taxes (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of income tax expense/(benefit) | Income tax expense/(benefit) consists of the following for the years ended (in thousands):
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Schedule of deferred tax assets and liabilities | (in thousands):
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Reconciliation of income attributable to continuing operations | The reconciliation of our effective income tax rate to the U.S. federal statutory tax rate is as follows:
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Stock-Based Compensation and Employee Benefits (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Compensation Related Costs [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of stock appreciation rights activity | A summary of our SAR activity and related information for 2017, 2016 and 2015 is as follows. These rights are time based and generally vest ratably over a period of five years.
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Summary of status and changes in nonvested restricted stock units | A summary of our RSU activity and related information for 2017, 2016 and 2015 is as follows. Grants of RSUs include both performance-based and time-based vesting conditions and generally vest over a three-year period.
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Financial Instruments with Off-Balance Sheet Risk (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||
Risks and Uncertainties [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of financial instruments with off-balance sheet risk | At December 31, 2017 and 2016, commitments to extend credit and standby and commercial letters of credit were as follows (in thousands):
At December 31, 2017 and 2016, we had $9.1 million and $11.4 million, respectively, in allowance for off-balance sheet credit losses related to these off-balance sheet commitments recorded in other liabilities in the consolidated balance sheets. |
Regulatory Restrictions (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Regulatory Capital Requirements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of compliance with Regulatory Capital Requirements | The table below summarizes our actual and required capital ratios under the Basel III Capital Rules (dollars in thousands):
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Earnings Per Share (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of computation of basic and diluted earnings per share | The following table presents the computation of basic and diluted earnings per share (in thousands except share data):
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Fair Value Disclosures (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of assets and liabilities measured at fair value | Assets and liabilities measured at fair value at December 31, 2017 and 2016 are as follows (in thousands):
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of the carrying amounts and estimated fair values of financial instruments | A summary of the carrying amounts and estimated fair values of financial instruments is as follows (in thousands):
|
Commitments and Contingencies (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||
Schedule of minimum future lease payments under operating leases | Minimum future lease payments under operating leases are as follows (in thousands):
|
Parent Company Only (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balance Sheet | Balance Sheet
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Statement of Earnings | Statement of Earnings
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Statement of Cash Flows | Statements of Cash Flows
|
Derivative Financial Instruments (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Derivative Instruments | The notional amounts and estimated fair values of derivative positions outstanding at December 31, 2017 and 2016 are presented in the following table (in thousands):
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule Of Weighted Average Interest Rate Received And Paid | The weighted-average receive and pay interest rates for interest rate swaps outstanding at December 31, 2017 and 2016 were as follows:
|
Quarterly Financial Data (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Selected Quarterly Financial Information [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Quarterly Financial Information |
|
Operations and Summary of Significant Accounting Policies (Details) |
12 Months Ended |
---|---|
Dec. 31, 2017 | |
Minimum | |
Property, Plant and Equipment [Line Items] | |
Useful life | 3 years |
Maximum | |
Property, Plant and Equipment [Line Items] | |
Useful life | 10 years |
Useful life | 5 years |
Securities (Details) - USD ($) $ in Thousands |
Dec. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Available-for-sale securities: | ||
Amortized Cost | $ 22,853 | $ 24,235 |
Gross Unrealized Gains | 1,073 | 999 |
Gross Unrealized Losses | (415) | (360) |
Estimated Fair Value | 23,511 | 24,874 |
Residential mortgage-backed securities | ||
Available-for-sale securities: | ||
Amortized Cost | 10,297 | 14,680 |
Gross Unrealized Gains | 648 | 972 |
Gross Unrealized Losses | 0 | 0 |
Estimated Fair Value | 10,945 | 15,652 |
Municipals | ||
Available-for-sale securities: | ||
Amortized Cost | 275 | |
Gross Unrealized Gains | 0 | |
Gross Unrealized Losses | 0 | |
Estimated Fair Value | 275 | |
Equity securities | ||
Available-for-sale securities: | ||
Amortized Cost | 12,556 | 9,280 |
Gross Unrealized Gains | 425 | 27 |
Gross Unrealized Losses | (415) | (360) |
Estimated Fair Value | $ 12,566 | $ 8,947 |
Securities (Details 2) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Fair Value | |||
Less Than 12 Months | $ 1,015 | $ 1,015 | |
12 Months or Longer | 6,091 | 6,146 | |
Total | 7,106 | 7,161 | |
Unrealized Loss | |||
Less Than 12 Months | (6) | (6) | |
12 Months or Longer | (409) | (354) | |
Total | (415) | (360) | |
Comprehensive income | 197,076 | 154,816 | $ 144,283 |
Net after-tax loss | $ (13) | $ 303 | $ 571 |
Loans and Allowance for Credit Losses (Details) - USD ($) $ in Thousands |
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
---|---|---|---|
Loans and Leases Receivable, Net Reported Amount | |||
Commercial | $ 9,189,811 | $ 7,291,545 | |
Mortgage finance | 5,308,160 | 4,497,338 | |
Construction | 2,166,208 | 2,098,706 | |
Real estate | 3,794,577 | 3,462,203 | |
Loans and Leases Receivable, Gross, Consumer, Real Estate | 48,684 | 34,587 | |
Equipment leases | 264,903 | 185,529 | |
Gross loans held for investment | 20,772,343 | 17,569,908 | |
Deferred income (net of direct origination costs) | (97,931) | (71,559) | |
Allowance for loan losses | (184,655) | (168,126) | $ (141,111) |
Loans held for investment, net | $ 20,489,757 | $ 17,330,223 |
Loans and Allowance for Credit Losses Loans and Allowance for Credit Losses (Details 4) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2017 |
Sep. 30, 2017 |
Jun. 30, 2017 |
Mar. 31, 2017 |
Dec. 31, 2016 |
Sep. 30, 2016 |
Jun. 30, 2016 |
Mar. 31, 2016 |
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Financing Receivable, Allowance for Credit Losses [Roll Forward] | |||||||||||
Beginning balance | $ 2,000 | $ 20,000 | $ 13,000 | $ 9,000 | $ 9,000 | $ 22,000 | $ 16,000 | $ 30,000 | $ 44,000 | $ 77,000 | $ 53,250 |
Unfunded loan commitments | |||||||||||
Financing Receivable, Allowance for Credit Losses [Roll Forward] | |||||||||||
Allowance for credit losses, beginning balance | $ 11,422 | $ 9,011 | 11,422 | 9,011 | |||||||
Beginning balance | (2,351) | 2,411 | |||||||||
Allowance for credit losses, ending balance | $ 9,071 | $ 11,422 | $ 9,071 | $ 11,422 | $ 9,011 |
Loans and Allowance for Credit Losses (Details 8) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2017
USD ($)
contract
|
Dec. 31, 2016
USD ($)
contract
|
|
Financing Receivable, Modifications [Line Items] | ||
Number of Contracts | contract | 4 | 2 |
Pre-Restructuring Outstanding Recorded Investment | $ 8,597 | $ 14,235 |
Post-Restructuring Outstanding Recorded Investment | $ 7,640 | $ 12,236 |
Energy [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
Number of Contracts | 1 | |
Pre-Restructuring Outstanding Recorded Investment | $ 1,070 | |
Post-Restructuring Outstanding Recorded Investment | $ 0 | |
Commercial | ||
Financing Receivable, Modifications [Line Items] | ||
Number of Contracts | contract | 3 | 2 |
Pre-Restructuring Outstanding Recorded Investment | $ 7,527 | $ 14,235 |
Post-Restructuring Outstanding Recorded Investment | $ 7,640 | $ 12,236 |
Loans and Allowance for Credit Losses (Details 9) - USD ($) $ in Thousands |
Dec. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Financing Receivable, Modifications [Line Items] | ||
Loans modified as restructured loans | $ 7,640 | $ 12,236 |
Extended maturity | ||
Financing Receivable, Modifications [Line Items] | ||
Loans modified as restructured loans | 712 | 0 |
Adjusted payment schedule | ||
Financing Receivable, Modifications [Line Items] | ||
Loans modified as restructured loans | 6,928 | 0 |
Combination of maturity extension and payment schedule adjustment | ||
Financing Receivable, Modifications [Line Items] | ||
Loans modified as restructured loans | $ 0 | $ 12,236 |
OREO and Valuation Allowance for Losses on OREO (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Other Real Estate [Roll Forward] | |||
Beginning balance | $ 18,961 | $ 278 | $ 568 |
Additions | 0 | 18,822 | 1,267 |
Sales | (1,108) | (139) | (1,557) |
Valuation allowance for OREO | 0 | 0 | 0 |
Direct write-downs | (6,111) | 0 | 0 |
Ending balance | 11,742 | 18,961 | 278 |
OREO write-down | $ 6,111 | $ 0 | $ 0 |
Certain Transfers of Financial Assets (Details) - USD ($) $ in Thousands |
Dec. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Loans and Leases Receivable Disclosure [Line Items] | ||
Outstanding balance | $ 1,009,271 | $ 980,414 |
Fair value | 1,007,695 | 968,929 |
Fair value over (under) outstanding balance | (1,576) | $ (11,485) |
SBA loans | Held for sale | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Fair value over (under) outstanding balance | $ 3,300 |
Certain Transfers of Financial Assets Certain Transfers of Financial Assets (Details 1) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
|
Loans Receivable Held-for-sale, Net, Reconciliation to Cash Flow [Roll Forward] | ||
Loans held for sale, beginning balance | $ 968,929 | $ 86,075 |
Loans purchased | 5,556,964 | 3,327,482 |
Payments and loans sold | (5,524,798) | (2,433,348) |
Change in fair value | 9,909 | (11,280) |
Loans held for sale, ending balance | $ 1,011,004 | $ 968,929 |
Certain Transfers of Financial Assets (Details 2) - USD ($) |
12 Months Ended | |
---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
|
Valuation Allowance for Impairment of Recognized Servicing Assets, Sales and Disposals [Abstract] | ||
Valuation allowance, beginning balance | $ 835,000 | |
Valuation allowance, ending balance | 1,333,000 | $ 835,000 |
Mortgage Servicing Rights | ||
Servicing Asset at Amortized Cost, Balance [Roll Forward] | ||
Balance, beginning of year | 28,536,000 | 423,000 |
Capitalized servicing rights | 67,970,000 | 29,816,000 |
Amortization | (8,356,000) | (1,703,000) |
Balance, end of period | 88,150,000 | 28,536,000 |
Valuation Allowance for Impairment of Recognized Servicing Assets, Sales and Disposals [Abstract] | ||
Valuation allowance, beginning balance | 0 | 0 |
Increase in valuation allowance | 2,823,000 | 0 |
Valuation allowance, ending balance | 2,823,000 | 0 |
MSRs, net | 85,327,000 | 28,536,000 |
Fair value | $ 86,321,000 | $ 30,877,000 |
Certain Transfers of Financial Assets (Details 3) - Mortgage Servicing Rights |
12 Months Ended | |
---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
|
Fair Value Assumption, Date of Securitization or Asset-backed Financing Arrangement, Transferor's Continuing Involvement, Servicing Assets or Liabilities [Line Items] | ||
Average discount rates (percent) | 9.90% | 9.96% |
Expected prepayment speeds (percent) | 9.99% | 7.91% |
Weighted-average life, in years | 7 years | 8 years |
Certain Transfers of Financial Assets (Details 4) - USD ($) |
12 Months Ended | |
---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
|
Transfers and Servicing [Abstract] | ||
Principal amount outstanding of loans in servicing portfolio | $ 7,000,000,000 | $ 2,200,000,000 |
Escrow deposits related to servicing portfolio | 73,400,000 | 21,000,000 |
Estimated exposure related to servicing assets | 1,333,000 | 835,000 |
Losses due to repurchase indemnification and make-whole obligations | 31,000 | 0 |
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past due balance | 39,936,000 | |
Held for sale | 90 days or more past due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past due balance | 19,700,000 | $ 0 |
Government guarantees | Held for sale | 90 days or more past due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past due balance | 19,000,000 | |
Mortgage servicing rights | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Impairment charges | $ 2,800,000 |
Certain Transfers of Financial Assets Certain Transfers of Financial Assets (Details 5) - USD ($) $ in Thousands |
Dec. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Transfers and Servicing [Abstract] | ||
50 bp adverse change in prepayment speed | $ (11,896) | $ (2,833) |
100 bp adverse change in prepayment speed | $ (28,226) | $ (6,812) |
Goodwill and Other Intangible Assets (Details) - USD ($) $ in Thousands |
Dec. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Goodwill | ||
Gross | $ 15,468 | $ 15,468 |
Accumulated Amortization | (374) | (374) |
Net | 15,094 | 15,094 |
Intangible assets—customer relationships and trademarks | ||
Gross | 9,006 | 9,006 |
Accumulated Amortization | (5,060) | (4,588) |
Net | 3,946 | 4,418 |
Total goodwill and intangible assets | ||
Gross | 24,474 | 24,474 |
Accumulated Amortization | (5,434) | (4,962) |
Net | $ 19,040 | $ 19,512 |
Goodwill and Other Intangible Assets (Details 1) - USD ($) $ in Thousands |
Dec. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2016 | $ 470 | |
2017 | 470 | |
2018 | 432 | |
2019 | 405 | |
2020 | 405 | |
Thereafter | 1,764 | |
Net | $ 3,946 | $ 4,418 |
Goodwill and Other Intangible Assets (Details 2) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Total intangible assets | $ 19,040 | $ 19,512 | |
Amortization expense related to intangible assets | $ 472 | $ 448 | $ 628 |
Premises and Equipment (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Summary of premises and equipment | |||
Premises and equipment, gross | $ 58,024 | $ 47,046 | |
Accumulated depreciation | (32,848) | (27,271) | |
Total premises and equipment, net | 25,176 | 19,775 | |
Depreciation, Depletion and Amortization | |||
Depreciation expense | 6,900 | 6,000 | $ 4,600 |
Premises | |||
Summary of premises and equipment | |||
Premises and equipment, gross | 25,790 | 22,887 | |
Furniture and equipment | |||
Summary of premises and equipment | |||
Premises and equipment, gross | $ 32,234 | $ 24,159 |
Deposits (Details) - USD ($) $ in Thousands |
Dec. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Non-interest bearing deposits | ||
Non-interest-bearing demand deposits | $ 7,812,660 | $ 7,994,201 |
Interest-bearing deposits | ||
Transaction | 2,567,208 | 1,954,834 |
Savings | 8,214,059 | 6,625,177 |
Time | 529,253 | 442,619 |
Total interest-bearing deposits | 11,310,520 | 9,022,630 |
Total deposits | $ 19,123,180 | $ 17,016,831 |
Deposits (Details 1) $ in Thousands |
Dec. 31, 2017
USD ($)
|
---|---|
Scheduled maturities of interest bearing time deposits | |
2015 | $ 492,208 |
2016 | 33,289 |
2017 | 2,817 |
2018 | 246 |
2019 | 244 |
2023 and after | 449 |
Interest bearing time deposits, total | $ 529,253 |
Deposits (Details 2) - USD ($) $ in Millions |
Dec. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Deposits [Abstract] | ||
Deposits from related parties | $ 13.5 | $ 15.4 |
Interest-bearing time deposits of $250,000 or more | $ 300.5 | $ 225.5 |
Borrowing Arrangements (Details 1) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Summary of other borrowing capacities | |||
Total FHLB borrowing capacity | $ 3,893,066 | $ 3,059,568 | $ 4,102,609 |
Unused Federal funds lines available from commercial banks | 885,000 | 1,118,000 | 1,231,000 |
Unused Federal Reserve Borrowings capacity | 4,114,594 | 3,179,087 | 2,966,702 |
Average amount oustanding | 6,800 | ||
FHLB borrowing capacity relating to loans | |||
Summary of other borrowing capacities | |||
Total FHLB borrowing capacity | 3,890,995 | 3,057,915 | 4,101,396 |
Unused Federal funds lines available from commercial banks | 130,000 | ||
FHLB borrowing capacity relating to securities | |||
Summary of other borrowing capacities | |||
Total FHLB borrowing capacity | $ 2,071 | $ 1,653 | $ 1,213 |
Borrowing Arrangements (Details 2) - USD ($) $ in Thousands |
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
---|---|---|---|
Debt Instrument [Line Items] | |||
Federal funds purchased and repurchase agreements | $ 365,040 | $ 109,575 | |
Within One Year | 3,165,040 | ||
After One But Within Three Years | 0 | ||
After Three But Within Five Years | 0 | ||
After Five Years | 394,812 | ||
Total | 3,559,852 | 2,504,025 | $ 2,037,139 |
FHLB borrowings | |||
Debt Instrument [Line Items] | |||
Within One Year | 2,800,000 | ||
After One But Within Three Years | 0 | ||
After Three But Within Five Years | 0 | ||
After Five Years | 0 | ||
Total | 2,800,000 | ||
Subordinated notes | |||
Debt Instrument [Line Items] | |||
Within One Year | 0 | ||
After One But Within Three Years | 0 | ||
After Three But Within Five Years | 0 | ||
After Five Years | 281,406 | ||
Total | 281,406 | 281,044 | 280,682 |
Trust preferred subordinated debentures | |||
Debt Instrument [Line Items] | |||
Within One Year | 0 | ||
After One But Within Three Years | 0 | ||
After Three But Within Five Years | 0 | ||
After Five Years | 113,406 | ||
Total | $ 113,406 | $ 113,406 | $ 113,406 |
Long-Term Debt (Details) - USD ($) $ in Thousands |
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
Jan. 31, 2014 |
Sep. 21, 2012 |
---|---|---|---|---|---|
Financial Instruments Subject to Mandatory Redemption by Settlement Terms [Line Items] | |||||
Total borrowings | $ 3,559,852 | $ 2,504,025 | $ 2,037,139 | ||
Trust preferred securities issued | 113,406 | $ 113,406 | $ 175,000 | $ 111,000 | |
Stated interest rate | 5.25% | 6.50% | |||
Trust preferred subordinated debentures | |||||
Financial Instruments Subject to Mandatory Redemption by Settlement Terms [Line Items] | |||||
Total borrowings | $ 113,400 |
Income Taxes (Details) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2017 |
Sep. 30, 2017 |
Jun. 30, 2017 |
Mar. 31, 2017 |
Dec. 31, 2016 |
Sep. 30, 2016 |
Jun. 30, 2016 |
Mar. 31, 2016 |
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Income Tax Disclosure [Abstract] | |||||||||||
Tax impact of TCJA | $ 17,600 | ||||||||||
Gross deferred tax asset | $ 63,000 | $ 89,700 | 63,000 | $ 89,700 | |||||||
Current: | |||||||||||
Federal | 94,112 | 86,612 | $ 80,957 | ||||||||
State | 3,257 | 2,412 | 2,245 | ||||||||
Total | 97,369 | 89,024 | 83,202 | ||||||||
Deferred | |||||||||||
Federal | 31,276 | (2,946) | (3,561) | ||||||||
State | 0 | 0 | 0 | ||||||||
Total | 31,276 | (2,946) | (3,561) | ||||||||
Total expense | |||||||||||
Federal | 125,388 | 83,666 | 77,396 | ||||||||
State | 3,257 | 2,412 | 2,245 | ||||||||
Total | $ 50,143 | $ 29,850 | $ 25,819 | $ 22,833 | $ 26,149 | $ 23,931 | $ 21,866 | $ 14,132 | $ 128,645 | $ 86,078 | $ 79,641 |
Financial Instruments with Off-Balance Sheet Risk (Details) - USD ($) $ in Thousands |
Dec. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Allowance allocation for off-balance sheet commitments | $ 9,100 | $ 11,400 |
Commitments to extend credit | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Off-balance sheet liability | 6,957,847 | 5,704,381 |
Standby letters of credit | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Off-balance sheet liability | $ 230,958 | $ 171,266 |
Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | 12 Months Ended | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2017 |
Sep. 30, 2017 |
Jun. 30, 2017 |
Mar. 31, 2017 |
Dec. 31, 2016 |
Sep. 30, 2016 |
Jun. 30, 2016 |
Mar. 31, 2016 |
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Numerator: | |||||||||||
Net income | $ 44,742 | $ 58,684 | $ 51,095 | $ 42,542 | $ 48,386 | $ 42,725 | $ 38,880 | $ 25,128 | $ 197,063 | $ 155,119 | $ 144,854 |
Preferred stock dividends | 2,437 | 2,438 | 2,437 | 2,438 | 2,437 | 2,438 | 2,437 | 2,438 | 9,750 | 9,750 | 9,750 |
Net income available to common stockholders | $ 42,305 | $ 56,246 | $ 48,658 | $ 40,104 | $ 45,949 | $ 40,287 | $ 36,443 | $ 22,690 | $ 187,313 | $ 145,369 | $ 135,104 |
Denominator: | |||||||||||
Denominator for basic earnings per share—weighted average shares | 49,630,000 | 49,607,000 | 49,577,000 | 49,536,000 | 47,156,000 | 45,981,000 | 45,924,000 | 45,889,000 | 49,587,169 | 46,239,210 | 45,808,440 |
Effect of employee stock-based awards | 239,008 | 128,228 | 211,168 | ||||||||
Effect of warrants to purchase common stock | 433,657 | 398,464 | 418,264 | ||||||||
Denominator for dilutive earnings per share—adjusted weighted average shares and assumed conversions | 50,312,000 | 50,251,000 | 50,230,000 | 50,234,000 | 47,760,000 | 46,510,000 | 46,438,000 | 46,354,000 | 50,259,834 | 46,765,902 | 46,437,872 |
Basic earnings per common share | $ 0.85 | $ 1.13 | $ 0.98 | $ 0.81 | $ 0.97 | $ 0.88 | $ 0.79 | $ 0.49 | $ 3.78 | $ 3.14 | $ 2.95 |
Diluted earnings per common share | $ 0.84 | $ 1.12 | $ 0.97 | $ 0.80 | $ 0.96 | $ 0.87 | $ 0.78 | $ 0.49 | $ 3.73 | $ 3.11 | $ 2.91 |
Stock options excluded from computation of EPS | 13,500 | 150,416 | 64,700 |
Fair Value Disclosures (Details 1) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
|
Impaired loans | ||
Fair Value Assets Measured On Non Recurring Basis Unobservable Input Reconciliation [Line Items] | ||
Asset measured on nonrecurring basis, carrying value | $ 32,200 | $ 74,100 |
Asset measured on nonrecurring basis, specific valuation allowance | 11,000 | 21,800 |
Asset measured on nonrecurring basis, reported fair value | 21,200 | 52,300 |
OREO | ||
Fair Value Assets Measured On Non Recurring Basis Unobservable Input Reconciliation [Line Items] | ||
Asset measured on nonrecurring basis, carrying value | $ 11,742 | $ 19,000 |
Commitments and Contingencies (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Commitments and Contingencies Disclosure [Abstract] | |||
Rent expense | $ 15,300 | $ 13,900 | $ 15,300 |
Minimum future lease payments under operating leases | |||
2015 | 16,446 | ||
2016 | 16,137 | ||
2017 | 15,286 | ||
2018 | 12,805 | ||
2019 | 12,138 | ||
2023 and thereafter | 17,299 | ||
Total | $ 90,111 |
Parent Company Only (Details 1) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2017 |
Sep. 30, 2017 |
Jun. 30, 2017 |
Mar. 31, 2017 |
Dec. 31, 2016 |
Sep. 30, 2016 |
Jun. 30, 2016 |
Mar. 31, 2016 |
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Statement of Earnings | |||||||||||
Interest on loans | $ 846,292 | $ 684,582 | $ 594,729 | ||||||||
Other non-interest income | 10,433 | 14,178 | 9,458 | ||||||||
Interest expense | $ 38,870 | $ 33,282 | $ 25,232 | $ 20,587 | $ 17,448 | $ 15,753 | $ 15,373 | $ 15,020 | 117,971 | 63,594 | 46,428 |
Salaries and employee benefits | 264,231 | 228,985 | 192,610 | ||||||||
Legal and professional | 29,731 | 23,326 | 22,150 | ||||||||
Other non-interest expense | 42,859 | 37,033 | 33,398 | ||||||||
Income tax expense | 50,143 | 29,850 | 25,819 | 22,833 | 26,149 | 23,931 | 21,866 | 14,132 | 128,645 | 86,078 | 79,641 |
Net income | 44,742 | 58,684 | 51,095 | 42,542 | 48,386 | 42,725 | 38,880 | 25,128 | 197,063 | 155,119 | 144,854 |
Preferred stock dividends | 2,437 | 2,438 | 2,437 | 2,438 | 2,437 | 2,438 | 2,437 | 2,438 | 9,750 | 9,750 | 9,750 |
Net income available to common stockholders | $ 42,305 | $ 56,246 | $ 48,658 | $ 40,104 | $ 45,949 | $ 40,287 | $ 36,443 | $ 22,690 | 187,313 | 145,369 | 135,104 |
Texas Capital Bancshares, Inc. | |||||||||||
Statement of Earnings | |||||||||||
Interest on loans | 3,271 | 3,250 | 3,250 | ||||||||
Dividend income | 10,400 | 10,400 | 10,400 | ||||||||
Other income | 108 | 90 | 76 | ||||||||
Total income | 13,779 | 13,740 | 13,726 | ||||||||
Other non-interest income | 13 | 152 | 8 | ||||||||
Interest expense | 10,908 | 10,525 | 9,867 | ||||||||
Salaries and employee benefits | 489 | 431 | 499 | ||||||||
Legal and professional | 1,700 | 1,429 | 1,640 | ||||||||
Other non-interest expense | 1,761 | 1,594 | 1,637 | ||||||||
Total expense | 14,858 | 13,979 | 13,643 | ||||||||
Income (loss) before income taxes and equity in undistributed income of subsidiary | (1,066) | (87) | 91 | ||||||||
Income tax expense | (371) | (33) | 33 | ||||||||
Income before income taxes | (695) | (54) | 58 | ||||||||
Equity in undistributed income of subsidiary | 194,118 | 151,445 | 141,041 | ||||||||
Net income | 193,423 | 151,391 | 141,099 | ||||||||
Preferred stock dividends | 9,750 | 9,750 | 9,750 | ||||||||
Net income available to common stockholders | $ 183,673 | $ 141,641 | $ 131,349 |
Derivative Financial Instruments Derivative Financial Instruments (Details 2) - Non-hedging - Commercial loan/lease - Interest rate swap |
Dec. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Interest rate received | ||
Derivative [Line Items] | ||
Weighted average fixed interest rate | 3.59% | 3.17% |
Interest rate paid | ||
Derivative [Line Items] | ||
Weighted average fixed interest rate | 4.34% | 4.58% |
Derivative Financial Instruments Derivative Financial Instruments (Details 3) |
Dec. 31, 2017
USD ($)
instrument
|
Dec. 31, 2016
USD ($)
|
---|---|---|
Derivative [Line Items] | ||
Cash collateral pledged for derivatives | $ 15,200,000 | $ 24,800,000 |
Risk participation agreement - participant bank | ||
Derivative [Line Items] | ||
Instruments held | instrument | 15 | |
Maximum exposure | $ 221,000 | |
Notional amount | $ 157,000,000 | |
Risk participation agreement - lead bank | ||
Derivative [Line Items] | ||
Instruments held | instrument | 10 | |
Notional amount | $ 86,300,000 | |
Non-hedging | Commercial loan/lease | ||
Derivative [Line Items] | ||
Credit risk exposure, net of collateral pledged, relating to derivatives | $ 16,700,000 | $ 37,900,000 |
Non-hedging | Interest rate cap | Commercial loan/lease | ||
Derivative [Line Items] | ||
Weighted average fixed interest rate | 2.40% | 2.45% |
Interest-bearing deposits | ||
Derivative [Line Items] | ||
Cash collateral pledged for derivatives | $ 14,000,000 | |
Other assets | ||
Derivative [Line Items] | ||
Cash collateral pledged for derivatives | $ 1,200,000 |
Stockholder's Equity (Details) - USD ($) $ / shares in Units, $ in Thousands |
12 Months Ended | |||
---|---|---|---|---|
Dec. 02, 2016 |
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Equity Distribution Agreement [Line Items] | ||||
Net proceeds from issuance of stock | $ 0 | $ 236,467 | ||
Par value of preferred stock | $ 0.01 | $ 0.01 | ||
Payments of dividends on preferred stock | $ 9,750 | $ 9,750 | $ 9,750 | |
Common Stock | ||||
Equity Distribution Agreement [Line Items] | ||||
Net proceeds from issuance of stock | $ 236,400 | $ 0 | $ 35 | |
Issuance of stock - shares | 3,450,000 | 0 | 3,450,000 | |
Repayments of short-term debt | $ 0 |
Quarterly Financial Data (Details) - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | 12 Months Ended | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2017 |
Sep. 30, 2017 |
Jun. 30, 2017 |
Mar. 31, 2017 |
Dec. 31, 2016 |
Sep. 30, 2016 |
Jun. 30, 2016 |
Mar. 31, 2016 |
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Selected Quarterly Financial Information [Abstract] | |||||||||||
Interest income | $ 249,519 | $ 237,643 | $ 208,191 | $ 183,946 | $ 188,671 | $ 182,492 | $ 172,442 | $ 159,803 | $ 879,299 | $ 703,408 | $ 602,958 |
Interest expense | 38,870 | 33,282 | 25,232 | 20,587 | 17,448 | 15,753 | 15,373 | 15,020 | 117,971 | 63,594 | 46,428 |
Net interest income | 210,649 | 204,361 | 182,959 | 163,359 | 171,223 | 166,739 | 157,069 | 144,783 | 761,328 | 639,814 | 556,530 |
Provision for credit losses | 2,000 | 20,000 | 13,000 | 9,000 | 9,000 | 22,000 | 16,000 | 30,000 | 44,000 | 77,000 | 53,250 |
Net interest income after provision for credit losses | 208,649 | 184,361 | 169,959 | 154,359 | 162,223 | 144,739 | 141,069 | 114,783 | 717,328 | 562,814 | 503,280 |
Non-interest income | 19,374 | 19,003 | 18,769 | 17,110 | 18,835 | 16,716 | 13,932 | 11,297 | 74,256 | 60,780 | 47,738 |
Non-interest expense | 133,138 | 114,830 | 111,814 | 106,094 | 106,523 | 94,799 | 94,255 | 86,820 | 465,876 | 382,397 | 326,523 |
Income before income taxes | 94,885 | 88,534 | 76,914 | 65,375 | 74,535 | 66,656 | 60,746 | 39,260 | 325,708 | 241,197 | 224,495 |
Income tax expense | 50,143 | 29,850 | 25,819 | 22,833 | 26,149 | 23,931 | 21,866 | 14,132 | 128,645 | 86,078 | 79,641 |
Net income | 44,742 | 58,684 | 51,095 | 42,542 | 48,386 | 42,725 | 38,880 | 25,128 | 197,063 | 155,119 | 144,854 |
Preferred stock dividends | 2,437 | 2,438 | 2,437 | 2,438 | 2,437 | 2,438 | 2,437 | 2,438 | 9,750 | 9,750 | 9,750 |
Net income available to common stockholders | $ 42,305 | $ 56,246 | $ 48,658 | $ 40,104 | $ 45,949 | $ 40,287 | $ 36,443 | $ 22,690 | $ 187,313 | $ 145,369 | $ 135,104 |
Basic earnings per share: | |||||||||||
Basic earnings per common share | $ 0.85 | $ 1.13 | $ 0.98 | $ 0.81 | $ 0.97 | $ 0.88 | $ 0.79 | $ 0.49 | $ 3.78 | $ 3.14 | $ 2.95 |
Diluted earnings per share: | |||||||||||
Diluted earnings per common share | $ 0.84 | $ 1.12 | $ 0.97 | $ 0.80 | $ 0.96 | $ 0.87 | $ 0.78 | $ 0.49 | $ 3.73 | $ 3.11 | $ 2.91 |
Average shares | |||||||||||
Basic | 49,630,000 | 49,607,000 | 49,577,000 | 49,536,000 | 47,156,000 | 45,981,000 | 45,924,000 | 45,889,000 | 49,587,169 | 46,239,210 | 45,808,440 |
Diluted | 50,312,000 | 50,251,000 | 50,230,000 | 50,234,000 | 47,760,000 | 46,510,000 | 46,438,000 | 46,354,000 | 50,259,834 | 46,765,902 | 46,437,872 |