Veritex Holdings, Inc. Reports Third Quarter Operating

DALLAS, Oct. 25, 2022 (GLOBE NEWSWIRE) — Veritex Holdings, Inc. (“Veritex”, the “Company”, “we” or “our”) (Nasdaq: VBTX), the holding firm for Veritex Community Bank, immediately introduced the outcomes for the quarter ended September 30, 2022.

“The third quarter of 2022 resulted in record dollar earnings for our Company in a resilient Texas market” stated President and CEO, C. Malcolm C. Holland, III. “We reported historical financial metrics with 2.2% in pre-tax, pre-provision operating return, 1.5% in return on average assets, return on average tangible common equity of 18% and an efficiency ratio of 44% coupled with continuing improved credit metrics noted by a 14 bp decrease in nonperforming assets. We remain focused on this positive momentum and deposit growth but more importantly our customers, the strong markets we serve and our shareholders”

¹ Refer to the part titled “Reconciliation of Non-GAAP Financial Measures” for a reconciliation of those non-generally accepted accounting ideas (“”GAAP”) monetary measures to their most instantly comparable GAAP measures.
² Annualized ratio.

Other Third Quarter Highlights

• Pre-tax, pre-provision working return on common property elevated 44 bps from the second quarter of 2022 to 2.20%;
• Net curiosity margin elevated to three.77%, up 35 foundation factors from the second quarter of 2022;
• Non-performing property (“NPAs”) to whole property decreased to 0.26%, or 14 bps from June 30, 2022 and 51 bps from September 30, 2021, respectively;
• Net charge-offs to common loans excellent was 3 foundation factors for the third quarter of 2022;
• Total loans held for funding (“LHI”), excluding mortgage warehouse (“MW”) and paycheck safety program (“PPP”) loans, grew $594.6 million, or 30.0% annualized, in the course of the three months ended September 30, 2022 from $8.5 billion on the finish of the second quarter of 2022;
• Total deposits grew $230.7 million, or 10.8% annualized, in the course of the three months ended September 30, 2022 from $8.5 billion on the finish of the second quarter of 2022; and
• Declared quarterly money dividend of $0.20 per share of excellent frequent inventory payable on November 25, 2022.

Results of Operations for the Three Months Ended September 30, 2022

Net Interest Income

For the three months ended September 30, 2022, web curiosity earnings earlier than provision for credit score losses was $101.0 million and web curiosity margin was 3.77% in comparison with $84.5 million and three.42%, respectively, for the three months ended June 30, 2022. The $16.6 million improve in web curiosity earnings earlier than provision for credit score losses was primarily resulting from a $27.0 million improve in curiosity earnings on loans pushed by a rise in common balances and mortgage yields in the course of the three months ended September 30, 2022. Net curiosity margin elevated 35 foundation factors in comparison with the three months ended June 30, 2022, primarily because of the improve in yields earned on loans throughout three months ended September 30, 2022, partially offset by a rise in funding prices.

Compared to the three months ended September 30, 2021, web curiosity earnings earlier than provision for credit score losses for the three months ended September 30, 2022 elevated by $29.8 million, or 41.8%. The improve was primarily resulting from a $38.1 million improve in curiosity earnings on loans pushed by a rise in common balances and mortgage yields. Net curiosity margin elevated 51 foundation factors to three.77% for the three months ended September 30, 2022 from 3.26% for the three months ended September 30, 2021. The improve was primarily because of the improve in common balances and mortgage yields in the course of the three months ended September 30, 2022, partially offset by a rise in funding prices.

Noninterest Income

Noninterest earnings for the three months ended September 30, 2022 was $13.0 million, a rise of $2.6 million, or 25.5%, in comparison with the three months ended June 30, 2022. The improve was primarily resulting from a $2.0 million improve in buyer swap earnings and a $2.2 million improve within the honest worth of the servicing asset, partially offset by a $2.0 million lower in fairness technique funding earnings.

Compared to the three months ended September 30, 2021, noninterest earnings for the three months ended September 30, 2022 decreased by $2.6 million, or 16.7%. The lower was primarily resulting from a $5.6 million lower in fairness technique funding earnings, partially offset by a $2.3 million improve in buyer swap earnings and a $1.0 million improve in mortgage charges.

Noninterest Expense

Noninterest expense was $51.0 million for the three months ended September 30, 2022, in comparison with $48.2 million for the three months ended June 30, 2022, a rise of $2.8 million, or 5.9%. This improve was primarily resulting from a $2.7 million improve in salaries and worker advantages from continued funding in expertise.

Compared to the three months ended September 30, 2021, noninterest expense for the three months ended September 30, 2022 elevated by $9.7 million, or 23.4%. The improve was primarily pushed by a $6.8 million improve in salaries and worker advantages because of a $4.1 million improve in salaries and worker advantages from continued funding in expertise.

Financial Condition

Total LHI, excluding MW and PPP loans, have been $8.5 billion at September 30, 2022, a rise of $594.6 million, or 30.0% annualized, in comparison with June 30, 2022. The improve was the results of the continued execution, and success of our mortgage development technique, together with our continued funding in expertise.

Total deposits have been $8.7 billion at September 30, 2022, a rise of $230.7 million, or 10.8% annualized, in comparison with June 30, 2022. The improve was primarily the results of a rise of $262.4 million in interest-bearing transaction and financial savings deposits and a rise of $104.7 million in certificates and different time deposits, partially offset by a $136.4 million lower in non-interest bearing deposits.

Credit Quality

Nonperforming property totaled $30.6 million, or 0.26% of whole property at September 30, 2022, in comparison with $45.0 million, or 0.40% of whole property, at June 30, 2022. The Company had web charge-offs of $2.2 million for the quarter, which have been totally reserved in opposition to in prior quarters below our allowance for credit score loss (“ACL”) mannequin.

The Company recorded a provision for credit score losses of $6.7 million for the three months ended September 30, 2022, a $9.0 million provision for credit score losses for the three months ended June 30, 2022 and no provision for credit score losses for the three months ended September 30, 2021. The recorded provision for credit score losses for the three months ended September 30, 2022, in comparison with the three months ended June 30, 2022, was primarily attributable to a rise on the whole reserves because of adjustments in financial components and mortgage development. For the three months ended September 30, 2022, we recorded an $850 thousand provision for unfunded commitments, which was attributable to adjustments in financial components and a rise of unfunded balances. ACL as a proportion of LHI, excluding MW and PPP loans, was 1.00%, 1.02% and 1.42% at September 30, 2022, June 30, 2022 and September 30, 2021, respectively.

Dividend Information

After the shut of the market on Tuesday, October 25, 2022, Veritex’s Board of Directors declared a quarterly money dividend of $0.20 per share on its excellent shares of frequent inventory. The dividend might be paid on or after November 25, 2022 to stockholders of report as of the shut of business on November 11, 2022.

Non-GAAP Financial Measures

Veritex’s administration makes use of sure non-GAAP (U.S. usually accepted accounting ideas) monetary measures to judge its working efficiency and supply data that’s vital to buyers. However, non-GAAP monetary measures are supplemental and needs to be seen along with, and never instead for, Veritex’s reported outcomes ready in accordance with GAAP. Specifically, Veritex critiques and studies tangible e book worth per frequent share, working earnings, tangible frequent fairness to tangible property, return on common tangible frequent fairness, pre-tax, pre-provision working earnings, pre-tax, pre-provision working return on common property, diluted working earnings per share, working return on common property, working return on common tangible frequent fairness and working effectivity ratio. Veritex has included on this earnings launch data associated to those non-GAAP monetary measures for the relevant durations offered. Please discuss with “Reconciliation of Non-GAAP Financial Measures” after the monetary highlights on the finish of this earnings launch for a reconciliation of those non-GAAP monetary measures.

Conference Call

The Company will host an investor convention name and webcast to evaluation the outcomes on Wednesday, October 26, 2022, at 8:30 a.m. Central Time. Participants could pre-register for the decision by visiting https://edge.media-server.com/mmc/p/w5hrkf8v and can obtain a novel PIN, which can be utilized when dialing in for the decision.

Participants may register by way of teleconference at:
https://register.vevent.com/register/BIcf08415eefb54948a6cdbc60349b8e55. Once registration is accomplished, individuals might be supplied with a dial-in quantity containing a customized convention code to entry the decision. All individuals are instructed to dial-in quarter-hour previous to the beginning time.

A replay might be out there inside roughly two hours after the completion of the decision, and made accessible for one week. You could entry the replay by way of webcast via the investor relations part of Veritex’s web site.

About Veritex Holdings, Inc.

Headquartered in Dallas, Texas, Veritex is a financial institution holding firm that conducts banking actions via its wholly owned subsidiary, Veritex Community Bank, with areas all through the Dallas-Fort Worth metroplex and within the Houston metropolitan space. Veritex Community Bank is a Texas state chartered financial institution regulated by the Texas Department of Banking and the Board of Governors of the Federal Reserve System. For extra data, go to www.veritexbank.com.

Forward-Looking Statements

This earnings launch contains “forward-looking statements”, throughout the that means of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based mostly on numerous details and derived using assumptions, present expectations, estimates and projections and are topic to recognized and unknown dangers, uncertainties and different components, which change over time and are past our management, which will trigger precise outcomes, efficiency or achievements to be materially totally different from any future outcomes, efficiency or achievements expressed or implied by such forward-looking statements. Forward-looking statements embrace, with out limitation, statements regarding the anticipated fee of Veritex Holdings, Inc.’s (“Veritex”) quarterly money dividend; the impression of sure adjustments in Veritex’s accounting insurance policies, requirements and interpretations; the results of the COVID-19 pandemic and actions taken in response thereto; and Veritex’s future monetary efficiency, business and development technique, projected plans and targets, in addition to different projections based mostly on macroeconomic and trade developments, that are inherently unreliable because of the a number of components that impression broader financial and trade developments, and any such variations could also be materials. Statements preceded by, adopted by or that in any other case embrace the phrases “believes,” “expects,” “anticipates,” “intends,” “projects,” “estimates,” “seeks,” “targets,” “outlooks,” “plans” and comparable expressions or future or conditional verbs resembling “will,” “should,” “would,” “may” and “could” are usually forward-looking in nature and never historic details, though not all forward-looking statements embrace the foregoing phrases. We refer you to the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of Veritex’s Annual Report on Form 10-Ok for the yr ended December 31, 2021 and any updates to these danger components set forth in Veritex’s Quarterly Reports on Form 10-Q, Current Reports on Form 8-Ok and different filings with the Securities and Exchange Commission (“SEC”), which can be found on the SEC’s web site at www.sec.gov. If a number of occasions associated to those or different dangers or uncertainties materialize, or if Veritex’s underlying assumptions show to be incorrect, precise outcomes could differ materially from what Veritex anticipates. Accordingly, you shouldn’t place undue reliance on any such forward-looking statements. Any forward-looking assertion speaks solely as of the date on which it’s made. Veritex doesn’t undertake any obligation, and particularly declines any obligation, to complement, replace or revise any forward-looking statements, whether or not because of new data, future developments or in any other case, besides as required by regulation. All forward-looking statements, expressed or implied, included on this earnings launch are expressly certified of their entirety by this cautionary assertion. This cautionary assertion also needs to be thought of in reference to any subsequent written or oral forward-looking statements that Veritex or individuals performing on Veritex’s behalf could challenge.

VERITEX HOLDINGS, INC. AND SUBSIDIARIES
Financial Highlights
(Unaudited)

¹Refer to the part titled “Reconciliation of Non-GAAP Financial Measures” after the monetary highlights for a reconciliation of those non-GAAP monetary measures to their most instantly comparable GAAP measures.
²Dividend quantity represents dividend paid per frequent share subsequent to every respective quarter finish.
³Annualized ratio for quarterly metrics.

VERITEX HOLDINGS, INC. AND SUBSIDIARIES
Financial Highlights
(In 1000’s)

VERITEX HOLDINGS, INC. AND SUBSIDIARIES
Financial Highlights
(In 1000’s, besides per share information)

VERITEX HOLDINGS, INC. AND SUBSIDIARIES
Financial Highlights
(Unaudited)

¹ Includes common excellent balances of loans held on the market of $14,023, $12,112 and $8,542 for the three months ended September 30, 2022, June 30, 2022, and September 30, 2021, respectively, and common balances of LHI, excluding MW and PPP loans.
² Net rate of interest unfold is the typical yield on interest-earning property minus the typical price on interest-bearing liabilities.
³ Net curiosity margin is the same as web curiosity earnings divided by common interest-earning property.

VERITEX HOLDINGS, INC. AND SUBSIDIARY
Financial Highlights
(In 1000’s besides percentages)

¹ Includes common excellent balances of loans held on the market of $12,973 and $13,140 for the 9 months ended September 30, 2022 and 2021, respectively, and common balances of LHI, excluding MW and PPP loans.
² Net rate of interest unfold is the typical yield on interest-earning property minus the typical price on interest-bearing liabilities.
³ Net curiosity margin is the same as web curiosity earnings divided by common interest-earning property.

VERITEX HOLDINGS, INC. AND SUBSIDIARIES
Financial Highlights

Yield Trend

  
¹Includes common excellent balances of loans held on the market of $14,023, $12,112, $12,769, $8,987 and $8,542 for the three months ended September 30, 2022, June 30, 2022, March 31, 2022, December 31, 2021 and September 30, 2021, respectively, and common balances of LHI, excluding MW and PPP loans.

² Net rate of interest unfold is the typical yield on interest-earning property minus the typical price on interest-bearing liabilities.
³ Net curiosity margin is the same as web curiosity earnings divided by common interest-earning property.

Supplemental Yield Trend

VERITEX HOLDINGS, INC. AND SUBSIDIARIES
Financial Highlights
(Unaudited)

LHI and Deposit Portfolio Composition

¹ Total LHI doesn’t embrace deferred charges of $17.5 million, $15.0 million, $11.5 million, $9.5 million and $8.1 million at September 30, 2022, June 30, 2022, March 31, 2022, December 31, 2021 and September 30, 2021, respectively.

VERITEX HOLDINGS, INC. AND SUBSIDIARIES
Financial Highlights
(Unaudited)
Asset Quality

¹ Accruing loans larger than 90 days late exclude buy credit score deteriorated loans larger than 90 days late which can be accounted for on a pooled foundation.

VERITEX HOLDINGS, INC. AND SUBSIDIARIES
Reconciliation of Non-GAAP Financial Measures
(Unaudited)

We determine sure monetary measures mentioned on this earnings launch as being “non-GAAP financial measures.” In accordance with SEC guidelines, we classify a monetary measure as being a non-GAAP monetary measure if that monetary measure excludes or contains quantities, or is topic to changes which have the impact of excluding or together with quantities, which can be included or excluded, because the case could also be, in essentially the most instantly comparable measure calculated and offered in accordance with usually accepted accounting ideas as in impact now and again within the United States (“GAAP”), in our statements of earnings, steadiness sheets or statements of money flows. Non-GAAP monetary measures don’t embrace working and different statistical measures or ratios calculated utilizing solely both one or each of (i) monetary measures calculated in accordance with GAAP and (ii) working measures or different measures that aren’t non-GAAP monetary measures.

The non-GAAP monetary measures that we current on this earnings launch shouldn’t be thought of in isolation or as an alternative choice to essentially the most instantly comparable or different monetary measures calculated in accordance with GAAP. Moreover, the way wherein we calculate the non-GAAP monetary measures that we current on this earnings launch could differ from that of different corporations reporting measures with comparable names. You ought to perceive how such different monetary establishments calculate their monetary measures that seem like comparable or have comparable names to the non-GAAP monetary measures now we have mentioned on this earnings launch when evaluating such non-GAAP monetary measures.

Tangible Book Value Per Common Share. Tangible e book worth is a non-GAAP measure usually utilized by monetary analysts and funding bankers to judge monetary establishments. We calculate: (a) tangible frequent fairness as whole stockholders’ fairness much less goodwill and core deposit intangibles, web of gathered amortization; and (b) tangible e book worth per frequent share as tangible frequent fairness (as described in clause (a)) divided by variety of frequent shares excellent. For tangible e book worth per frequent share, essentially the most instantly comparable monetary measure calculated in accordance with GAAP is e book worth per frequent share.

We consider that this measure is vital to many buyers within the market who’re focused on adjustments from interval to interval in e book worth per frequent share unique of adjustments in core deposit intangibles. Goodwill and different intangible property have the impact of accelerating whole e book worth whereas not rising our tangible e book worth.

The following desk reconciles, as of the dates set forth under, whole stockholders’ fairness to tangible frequent fairness and presents our tangible e book worth per frequent share in contrast with our e book worth per frequent share:

VERITEX HOLDINGS, INC. AND SUBSIDIARIES
Reconciliation of Non-GAAP Financial Measures
(Unaudited)

Tangible Common Equity to Tangible Assets. Tangible frequent fairness to tangible property is a non-GAAP measure usually utilized by monetary analysts and funding bankers to judge monetary establishments. We calculate: (a) tangible frequent fairness as whole stockholders’ fairness, much less goodwill and core deposit intangibles, web of gathered amortization; (b) tangible property as whole property much less goodwill and core deposit intangibles, web of gathered amortization; and (c) tangible frequent fairness to tangible property as tangible frequent fairness (as described in clause (a)) divided by tangible property (as described in clause (b)). For tangible frequent fairness to tangible property, essentially the most instantly comparable monetary measure calculated in accordance with GAAP is whole stockholders’ fairness to whole property.

We consider that this measure is vital to many buyers within the market who’re within the relative adjustments from interval to interval in frequent fairness and whole property, in every case, unique of adjustments in core deposit intangibles. Goodwill and different intangible property have the impact of accelerating each whole stockholders’ fairness and property whereas not rising our tangible frequent fairness or tangible property.

The following desk reconciles, as of the dates set forth under, whole stockholders’ fairness to tangible frequent fairness and whole property to tangible property and presents our tangible frequent fairness to tangible property: