Texas Capital Bancshares, Inc. Announces Second Quarter 2025 Results
Second quarter 2025 net income of $77.3 million and net income available to common stockholders of $73.0 million, up 86% and 95%, respectively, year-over-year
Second quarter 2025 EPS of $1.58 per diluted share and adjusted EPS(1) of $1.63 per diluted share, up 98% and 104%, respectively, year-over-year
Strong balance sheet growth with total loans increasing 7% quarter-over-quarter and 10% year-over-year
Book Value and Tangible Book Value(2) per share both increasing 13% year-over-year, reaching record levels
DALLAS, July 17, 2025 (GLOBE NEWSWIRE) -- Texas Capital Bancshares, Inc. (NASDAQ:TCBI), the parent company of Texas Capital Bank, announced operating results for the second quarter of 2025.
"Our multi-year focus on building a differentiated, full-service financial services firm has strengthened our client franchise and consistently delivered high-quality outcomes across our platform, driving strong financial performance this quarter," said Rob C. Holmes, Chairman, President & CEO. "The strategic actions we've taken have structurally enhanced our earnings power, and as we enter the second half of the year, the breadth of our capabilities and the strength of our balance sheet position us to deliver durable, through-cycle results for both clients and shareholders."
2nd Quarter
1st Quarter
2nd Quarter
(dollars in thousands except per share data)
2025
2025
2024
OPERATING RESULTS
Net income
$
77,328
$
47,047
$
41,662
Net income available to common stockholders
$
73,016
$
42,734
$
37,350
Pre-provision net revenue(3)
$
117,188
$
77,458
$
78,597
Diluted earnings per common share
$
1.58
$
0.92
$
0.80
Diluted common shares
46,215,394
46,616,704
46,872,498
Return on average assets
0.99
%
0.61
%
0.56
%
Return on average common equity
9.17
%
5.56
%
5.26
%
OPERATING RESULTS, ADJUSTED(1)
Net income
$
79,841
$
47,047
$
42,020
Net income available to common stockholders
$
75,529
$
42,734
$
37,708
Pre-provision net revenue(3)
$
120,475
$
77,458
$
79,059
Diluted earnings per common share
$
1.63
$
0.92
$
0.80
Diluted common shares
46,215,394
46,616,704
46,872,498
Return on average assets
1.02
%
0.61
%
0.57
%
Return on average common equity
9.48
%
5.56
%
5.31
%
BALANCE SHEET
Loans held for investment
$
18,035,945
$
17,654,243
$
16,700,569
Loans held for investment, mortgage finance
5,889,589
4,725,541
5,078,161
Total loans held for investment
23,925,534
22,379,784
21,778,730
Loans held for sale
—
—
36,785
Total assets
31,943,535
31,375,749
29,854,994
Non-interest bearing deposits
7,718,006
7,874,780
7,987,715
Total deposits
26,064,309
26,053,034
23,818,327
Stockholders' equity
3,510,070
3,429,774
3,175,601
(1) These adjusted measures are non-GAAP measures. Please refer to "GAAP to Non-GAAP Reconciliations" for the computations of these adjusted measures and the reconciliation of these non-GAAP measures to the most directly comparable GAAP measure.(2) Stockholders' equity excluding preferred stock, less goodwill and intangibles, divided by shares outstanding at period end.(3) Net interest income plus non-interest income, less non-interest expense.
SECOND QUARTER 2025 COMPARED TO FIRST QUARTER 2025
For the second quarter of 2025, net income available to common stockholders was $73.0 million, or $1.58 per diluted share, compared to $42.7 million, or $0.92 per diluted share, for the first quarter of 2025.
Provision for credit losses for the second quarter of 2025 was $15.0 million, compared to $17.0 million for the first quarter of 2025. The $15.0 million provision for credit losses recorded in the second quarter of 2025 resulted primarily from an increase in total loans held for investment ("LHI") and $13.0 million in net charge-offs, partially offset by a decrease in criticized loans.
Net interest income was $253.4 million for the second quarter of 2025, compared to $236.0 million for the first quarter of 2025, primarily due to increases in average earning assets and earning asset yields, a decrease in average short-term borrowings and the impact of one additional day in the second quarter. Net interest margin for the second quarter of 2025 was 3.35%, an increase of 16 basis points from the first quarter of 2025. LHI, excluding mortgage finance, yields decreased 4 basis points from the first quarter of 2025 and LHI, mortgage finance, yields increased 49 basis points from the first quarter of 2025. Total cost of deposits was 2.65% for the second quarter of 2025, an 11 basis point decrease from the first quarter of 2025.
Non-interest income for the second quarter of 2025 increased $9.6 million compared to the first quarter of 2025 primarily due to increases in investment banking and advisory fees and trading income, partially offset by a $1.9 million loss on sale of available-for-sale debt securities recognized during the second quarter of 2025.
Non-interest expense for the second quarter of 2025 decreased $12.7 million compared to the first quarter of 2025, primarily due to decreases in salaries and benefits, related to the effect of seasonal payroll expenses that peak in the first quarter, and legal and professional expense, partially offset by an increase in other non-interest expense.
SECOND QUARTER 2025 COMPARED TO SECOND QUARTER 2024
Net income available to common stockholders was $73.0 million, or $1.58 per diluted share, for the second quarter of 2025, compared to $37.4 million, or $0.80 per diluted share, for the second quarter of 2024.
The second quarter of 2025 included a $15.0 million provision for credit losses, reflecting an increase in total LHI and $13.0 million in net charge-offs, partially offset by a decline in criticized loans, compared to a $20.0 million provision for credit losses for the second quarter of 2024.
Net interest income increased to $253.4 million for the second quarter of 2025, compared to $216.6 million for the second quarter of 2024, primarily due to an increase in average earning assets and a decrease in funding costs, partially offset by an increase in average interest bearing liabilities. Net interest margin increased 34 basis points to 3.35% for the second quarter of 2025, as compared to the second quarter of 2024. LHI, excluding mortgage finance, yields decreased 44 basis points compared to the second quarter of 2024 and LHI, mortgage finance yields increased 48 basis points from the second quarter of 2024. Total cost of deposits decreased 34 basis points compared to the second quarter of 2024.
Non-interest income for the second quarter of 2025 increased $3.6 million compared to the second quarter of 2024 primarily due to increases in service charges on deposit accounts, trading income and other non-interest income, partially offset by the loss on sale of available-for-sale debt securities mentioned above.
Non-interest expense for the second quarter of 2025 increased $1.9 million compared to the second quarter of 2024, primarily due to increases in salaries and benefits, occupancy expense and communications and technology expense, partially offset by a decrease in marketing expense.
CREDIT QUALITY
Net charge-offs of $13.0 million were recorded during the second quarter of 2025, compared to net charge-offs of $9.8 million and $12.0 million during the first quarter of 2025 and the second quarter of 2024, respectively. Criticized loans totaled $637.5 million at June 30, 2025, compared to $762.9 million at March 31, 2025 and $859.7 million at June 30, 2024. Non-accrual LHI totaled $113.6 million at June 30, 2025, compared to $93.6 million at March 31, 2025 and $85.0 million at June 30, 2024. The ratio of non-accrual LHI to total LHI for the second quarter of 2025 was 0.47%, compared to 0.42% for the first quarter of 2025 and 0.39% for the second quarter of 2024. The ratio of total allowance for credit losses to total LHI was 1.40% at June 30, 2025, compared to 1.48% and 1.44% at March 31, 2025 and June 30, 2024, respectively.
REGULATORY RATIOS AND CAPITAL
All regulatory ratios continue to be in excess of "well capitalized" requirements as of June 30, 2025. CET1, tier 1 capital, total capital and leverage ratios were 11.4%, 12.9%, 15.3% and 11.8%, respectively, at June 30, 2025, compared to 11.6%, 13.1%, 15.6% and 11.8%, respectively, at March 31, 2025 and 11.6%, 13.1%, 15.7% and 12.2%, respectively, at June 30, 2024. At June 30, 2025, our ratio of tangible common equity to total tangible assets was 10.1%, compared to 10.0% at March 31, 2025 and 9.6% at June 30, 2024.
During the second quarter of 2025, the Company repurchased 317,860 shares of its common stock for an aggregate purchase price, including excise tax expense, of $21.0 million, at a weighted average price of $65.50 per share.
About Texas Capital Bancshares, Inc.
Texas Capital Bancshares, Inc. (NASDAQ®: TCBI), a member of the Russell 2000® Index and the S&P MidCap 400®, is the parent company of Texas Capital Bank ("TCB"). Texas Capital is the collective brand name for TCB and its separate, non-bank affiliates and wholly-owned subsidiaries. Texas Capital is a full-service financial services firm that delivers customized solutions to businesses, entrepreneurs and individual customers. Founded in 1998, the institution is headquartered in Dallas with offices in Austin, Houston, San Antonio, and Fort Worth, and has built a network of clients across the country. With the ability to service clients through their entire lifecycles, Texas Capital has established commercial banking, consumer banking, investment banking and wealth management capabilities.
Forward Looking Statements
This communication contains "forward-looking statements" within the meaning of and pursuant to the Private Securities Litigation Reform Act of 1995 regarding, among other things, TCBI's financial condition, results of operations, business plans and future performance. These statements are not historical in nature and may often be identified by the use of words such as "believes," "projects," "expects," "may," "estimates," "should," "plans," "targets," "intends" "could," "would," "anticipates," "potential," "confident," "optimistic" or the negative thereof, or other variations thereon, or comparable terminology, or by discussions of strategy, objectives, estimates, trends, guidance, expectations and future plans.
Because forward-looking statements relate to future results and occurrences, they are subject to inherent and various uncertainties, risks, and changes in circumstances that are difficult to predict, may change over time, are based on management's expectations and assumptions at the time the statements are made and are not guarantees of future results. Numerous risks and other factors, many of which are beyond management's control, could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. While there can be no assurance that any list of risks is complete, important risks and other factors that could cause actual results to differ materially from those contemplated by forward-looking statements include, but are not limited to: economic or business conditions in Texas, the United States or globally that impact TCBI or its customers; negative credit quality developments arising from the foregoing or other factors, including recent trade policies and their impact on our customers; TCBI's ability to effectively manage its liquidity and maintain adequate regulatory capital to support its businesses; TCBI's ability to pursue and execute upon growth plans, whether as a function of capital, liquidity or other limitations; TCBI's ability to successfully execute its business strategy, including its strategic plan and developing and executing new lines of business and new products and services and potential strategic acquisitions; the extensive regulations to which TCBI is subject and its ability to comply with applicable governmental regulations, including legislative and regulatory changes; TCBI's ability to effectively manage information technology systems, including third party vendors, cyber or data privacy incidents or other failures, disruptions or security breaches; TCBI's ability to use technology to provide products and services to its customers; risks related to the development and use of artificial intelligence; changes in interest rates, including the impact of interest rates on TCBI's securities portfolio and funding costs, as well as related balance sheet implications stemming from the fair value of our assets and liabilities; the effectiveness of TCBI's risk management processes strategies and monitoring; fluctuations in commercial and residential real estate values, especially as they relate to the value of collateral supporting TCBI's loans; the failure to identify, attract and retain key personnel and other employees; adverse developments in the banking industry and the potential impact of such developments on customer confidence, liquidity and regulatory responses to these developments, including in the context of regulatory examinations and related findings and actions; negative press and social media attention with respect to the banking industry or TCBI, in particular; claims, litigation or regulatory investigations and actions that TCBI may become subject to; severe weather, natural disasters, climate change, acts of war, terrorism, global or other geopolitical conflicts, or other external events, as well as related legislative and regulatory initiatives; and the risks and factors more fully described in TCBI's most recent Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and other documents and filings with the SEC. The information contained in this communication speaks only as of its date. Except to the extent required by applicable law or regulation, we disclaim any obligation to update such factors or to publicly announce the results of any revisions to any of the forward-looking statements included herein to reflect future events or developments.
TEXAS CAPITAL BANCSHARES, INC.
SELECTED FINANCIAL HIGHLIGHTS (UNAUDITED)
(dollars in thousands except per share data)
2nd Quarter
1st Quarter
4th Quarter
3rd Quarter
2nd Quarter
2025
2025
2024
2024
2024
CONSOLIDATED STATEMENTS OF INCOME
Interest income
$
439,567
$
427,289
$
437,571
$
452,533
$
422,068
Interest expense
186,172
191,255
207,964
212,431
205,486
Net interest income
253,395
236,034
229,607
240,102
216,582
Provision for credit losses
15,000
17,000
18,000
10,000
20,000
Net interest income after provision for credit losses
238,395
219,034
211,607
230,102
196,582
Non-interest income
54,069
44,444
54,074
(114,771
)
50,424
Non-interest expense
190,276
203,020
172,159
195,324
188,409
Income/(loss) before income taxes
102,188
60,458
93,522
(79,993
)
58,597
Income tax expense/(benefit)
24,860
13,411
22,499
(18,674
)
16,935
Net income/(loss)
77,328
47,047
71,023
(61,319
)
41,662
Preferred stock dividends
4,312
4,313
4,312
4,313
4,312
Net income/(loss) available to common stockholders
$
73,016
$
42,734
$
66,711
$
(65,632
)
$
37,350
Diluted earnings/(loss) per common share
$
1.58
$
0.92
$
1.43
$
(1.41
)
$
0.80
Diluted common shares
46,215,394
46,616,704
46,770,961
46,608,742
46,872,498
CONSOLIDATED BALANCE SHEET DATA
Total assets
$
31,943,535
$
31,375,749
$
30,731,883
$
31,629,299
$
29,854,994
Loans held for investment
18,035,945
17,654,243
17,234,492
16,764,512
16,700,569
Loans held for investment, mortgage finance
5,889,589
4,725,541
5,215,574
5,529,659
5,078,161
Loans held for sale
—
—
—
9,022
36,785
Interest bearing cash and cash equivalents
2,507,691
3,600,969
3,012,307
3,894,537
2,691,352
Investment securities
4,608,628
4,531,219
4,396,115
4,405,520
4,388,976
Non-interest bearing deposits
7,718,006
7,874,780
7,485,428
9,070,804
7,987,715
Total deposits
26,064,309
26,053,034
25,238,599
25,865,255
23,818,327
Short-term borrowings
1,250,000
750,000
885,000
1,035,000
1,675,000
Long-term debt
620,256
660,521
660,346
660,172
659,997
Stockholders' equity
3,510,070
3,429,774
3,367,936
3,354,044
3,175,601
End of period shares outstanding
45,746,836
46,024,933
46,233,812
46,207,757
46,188,078
Book value per share
$
70.17
$
68.00
$
66.36
$
66.09
$
62.26
Tangible book value per share(1)
$
70.14
$
67.97
$
66.32
$
66.06
$
62.23
SELECTED FINANCIAL RATIOS
Net interest margin
3.35
%
3.19
%
2.93
%
3.16
%
3.01
%
Return on average assets
0.99
%
0.61
%
0.88
%
(0.78
)%
0.56
%
Return on average assets, adjusted(4)
1.02
%
0.61
%
0.88
%
1.00
%
0.57
%
Return on average common equity
9.17
%
5.56
%
8.50
%
(8.87
)%
5.26
%
Return on average common equity, adjusted(4)
9.48
%
5.56
%
8.50
%
10.04
%
5.31
%
Efficiency ratio(2)
61.9
%
72.4
%
60.7
%
155.8
%
70.6
%
Efficiency ratio, adjusted(2)(4)
61.1
%
72.4
%
60.7
%
62.3
%
70.4
%
Non-interest income to average earning assets
0.72
%
0.60
%
0.69
%
(1.52
)%
0.71
%
Non-interest income to average earning assets, adjusted(4)
0.74
%
0.60
%
0.69
%
0.86
%
0.71
%
Non-interest expense to average earning assets
2.52
%
2.75
%
2.21
%
2.59
%
2.65
%
Non-interest expense to average earning assets, adjusted(4)
2.50
%
2.75
%
2.21
%
2.52
%
2.65
%
Common equity to total assets
10.1
%
10.0
%
10.0
%
9.7
%
9.6
%
Tangible common equity to total tangible assets(3)
10.1
%
10.0
%
10.0
%
9.7
%
9.6
%
Common Equity Tier 1
11.4
%
11.6
%
11.4
%
11.2
%
11.6
%
Tier 1 capital
12.9
%
13.1
%
12.8
%
12.6
%
13.1
%
Total capital
15.3
%
15.6
%
15.4
%
15.2
%
15.7
%
Leverage
11.8
%
11.8
%
11.3
%
11.4
%
12.2
%
(1) Stockholders' equity excluding preferred stock, less goodwill and intangibles, divided by shares outstanding at period end.(2) Non-interest expense divided by the sum of net interest income and non-interest income.(3) Stockholders' equity excluding preferred stock, less goodwill and intangibles, divided by total assets, less goodwill and intangibles.(4) These adjusted measures are non-GAAP measures. Please refer to "GAAP to Non-GAAP Reconciliations" for the computations of these adjusted measures and the reconciliation of these non-GAAP measures to the most directly comparable GAAP measure.
TEXAS CAPITAL BANCSHARES, INC.
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(dollars in thousands)
June 30,2025
March 31,2025
December 31,2024
September 30,2024
June 30,2024
Assets
Cash and due from banks
$
182,451
$
201,504
$
176,501
$
297,048
$
221,727
Interest bearing cash and cash equivalents
2,507,691
3,600,969
3,012,307
3,894,537
2,691,352
Available-for-sale debt securities
3,774,141
3,678,378
3,524,686
3,518,662
3,483,231
Held-to-maturity debt securities
761,907
779,354
796,168
812,432
831,513
Equity securities
68,692
71,679
75,261
74,426
74,232
Trading securities
3,888
1,808
—
—
—
Investment securities
4,608,628
4,531,219
4,396,115
4,405,520
4,388,976
Loans held for sale
—
—
—
9,022
36,785
Loans held for investment, mortgage finance
5,889,589
4,725,541
5,215,574
5,529,659
5,078,161
Loans held for investment
18,035,945
17,654,243
17,234,492
16,764,512
16,700,569
Less: Allowance for credit losses on loans
277,648
278,379
271,709
273,143
267,297
Loans held for investment, net
23,647,886
22,101,405
22,178,357
22,021,028
21,511,433
Premises and equipment, net
86,831
84,575
85,443
81,577
69,464
Accrued interest receivable and other assets
908,552
854,581
881,664
919,071
933,761
Goodwill and intangibles, net
1,496
1,496
1,496
1,496
1,496
Total assets
$
31,943,535
$
31,375,749
$
30,731,883
$
31,629,299
$
29,854,994
Liabilities and Stockholders' Equity
Liabilities:
Non-interest bearing deposits
$
7,718,006
$
7,874,780
$
7,485,428
$
9,070,804
$
7,987,715
Interest bearing deposits
18,346,303
