Hilltop Holdings Inc. (NYSE: HTH) (“Hilltop”) today announced
financial results for the fourth quarter and full year 2022.
Hilltop produced income to common stockholders of $25.6 million, or
$0.39 per diluted share, for the fourth quarter of 2022, compared
to $62.2 million, or $0.78 per diluted share, for the fourth
quarter of 2021. Income to common stockholders for the full year
2022 was $113.1 million, or $1.60 per diluted share, compared to
$374.5 million, or $4.61 per diluted share, for the full year 2021.
Hilltop’s financial results for the fourth quarter and full year of
2022 included significant decreases in year-over-year mortgage
origination segment net gains from sales of loans and other
mortgage production income, while the banking segment recorded a
provision for credit losses as opposed to a reversal of credit
losses in respective prior year periods.
Hilltop also announced that its Board of Directors declared a
quarterly cash dividend of $0.16 per common share, a 7% increase
from the prior quarter, payable on February 24, 2023, to all common
stockholders of record as of the close of business on February 10,
2023. Additionally, the Hilltop Board of Directors authorized,
subject to regulatory approvals or non-objections, a new stock
repurchase program through January 2024, under which Hilltop may
repurchase, in the aggregate, up to $75.0 million of its
outstanding common stock. During 2022, Hilltop paid $442.3 million
to repurchase approximately 14.87 million shares of its common
stock at a price of $29.75 per share pursuant to the tender offer
completed in May 2022. These shares were returned to the pool of
authorized but unissued shares of common stock.
Headwinds during 2022, including the impact of tight housing
inventories on mortgage volumes, declining deposit balances, rapid
increases in market interest rates and a declining economic
forecast, are expected to continue to have an adverse impact on our
operating results during 2023. The impacts of such headwinds in
2023 remain uncertain and will depend on developments outside of
our control, including, among others, timing and significance of
further changes in U.S. treasury yields and mortgage interest
rates, exposure to increasing funding costs, inflationary pressures
associated with compensation, occupancy and software costs and
labor market conditions, the Russian-Ukraine conflict and its
impact on supply chains, and the impact of the pandemic.
Jeremy B. Ford, President and CEO of Hilltop, said “Although we
experienced a challenging operating environment in 2022, Hilltop
still generated consolidated profitability and finished the year a
more resilient company. The abrupt market shifts in the mortgage
and fixed income businesses had a negative impact across our
company, particularly at PrimeLending and HilltopSecurities, while
PlainsCapital Bank delivered across all of its key priorities,
including prudent loan growth, sound credit quality and efficiency.
I am proud of our teams’ accomplishments during the year, as they
continued to deliver high-quality products and services for our
clients, while also making tough, yet prudent, expense decisions to
right-size our franchise.
“Additionally, our focus on maintaining a strong balance sheet
with significant capital and liquidity has positioned Hilltop for
long-term success regardless of interest rate and economic
volatility. Finally, I am very pleased that Hilltop returned a
record amount of capital to stockholders during 2022, primarily
through our successful tender offer share repurchase completed in
May.”
Fourth Quarter 2022 Highlights for Hilltop:
- The provision for credit losses was $3.6 million during the
fourth quarter of 2022, compared to a reversal of credit losses of
$0.8 million in the third quarter of 2022 and a reversal of credit
losses of $18.6 million in the fourth quarter of 2021;
- The provision for credit losses during the fourth quarter of
2022 reflected a deteriorating U.S. economic outlook since the
prior quarter.
- For the fourth quarter of 2022, net gains from sale of loans
and other mortgage production income and mortgage loan origination
fees within our mortgage origination segment was $71.1 million,
compared to $192.0 million in the fourth quarter of 2021, a 63.0%
decrease;
- Mortgage loan origination production volume was $2.0 billion
during the fourth quarter of 2022, compared to $5.0 billion in the
fourth quarter of 2021;
- Net gains from mortgage loans sold to third parties decreased
to 211 basis points during the fourth quarter of 2022, compared to
227 basis points in the third quarter of 2022.
- Hilltop’s consolidated annualized return on average assets and
return on average stockholders’ equity for the fourth quarter of
2022 were 0.63% and 4.99%, respectively, compared to 1.41% and
9.93%, respectively, for the fourth quarter of 2021;
- Hilltop’s book value per common share increased to $31.62 at
December 31, 2022, compared to $31.46 at September 30, 2022;
- Hilltop’s total assets were $16.3 billion and $16.6 billion at
December 31, 2022 and September 30, 2022, respectively;
- Loans1, net of allowance for credit losses, were $7.6 billion
and $7.4 billion at December 31, 2022 and September 30, 2022;
- Non-performing loans were $30.3 million, or 0.33% of total
loans, at December 31, 2022, compared to $34.6 million, or 0.39% of
total loans, at September 30, 2022;
- Loans held for sale decreased by 2.1% from September 30, 2022
to $1.0 billion at December 31, 2022;
- Total deposits were $11.3 billion and $11.4 billion at December
31, 2022 and September 30, 2022, respectively;
- Hilltop maintained strong capital levels2 with a Tier 1
Leverage Ratio3 of 11.47% and a Common Equity Tier 1 Capital Ratio
of 18.22% at December 31, 2022;
- Hilltop’s consolidated net interest margin4 increased to 3.23%
for the fourth quarter of 2022, compared to 3.19% in the third
quarter of 2022;
- For the fourth quarter of 2022, noninterest income was $169.8
million, compared to $284.8 million in the fourth quarter of 2021,
a 40.4% decrease;
- For the fourth quarter 2022, noninterest expense was $253.4
million, compared to $322.2 million in the fourth quarter of 2021,
a 21.4% decrease; and
- Hilltop’s effective tax rate was 26.6% during the fourth
quarter of 2022, compared to 24.2% during the same period in 2021.
- The effective tax rate for the fourth quarter of 2022 was
higher than the applicable statutory rate primarily due to the
impact of non-deductible compensation expense and other permanent
adjustments.
___________________
1
“Loans” reflect loans held for investment
excluding broker-dealer margin loans, net of allowance for credit
losses, of $431.0 million and $402.0 million at December 31, 2022
and September 30, 2022, respectively.
2
Capital ratios reflect Hilltop’s decision
to elect the transition option as issued by the federal banking
regulatory agencies in March 2020 that permits banking institutions
to mitigate the estimated cumulative regulatory capital effects
from CECL over a five-year transitionary period.
3
Based on the end of period Tier 1 capital
divided by total average assets during the quarter, excluding
goodwill and intangible assets.
4
Net interest margin is defined as net
interest income divided by average interest-earning assets.
Consolidated Financial and Other
Information
Consolidated Balance Sheets
December 31,
September 30,
June 30,
March 31,
December 31,
(in 000's)
2022
2022
2022
2022
2021
Cash and due from banks
$
1,579,512
$
1,777,584
$
1,783,554
$
2,886,812
$
2,823,138
Federal funds sold
650
663
381
383
385
Assets segregated for regulatory
purposes
67,737
109,358
120,816
128,408
221,740
Securities purchased under agreements to
resell
118,070
145,365
139,929
256,991
118,262
Securities:
Trading, at fair value
755,032
641,864
593,273
471,763
647,998
Available for sale, at fair value, net
1,658,766
1,584,724
1,562,222
1,462,340
2,130,568
Held to maturity, at amortized cost,
net
875,532
889,452
920,583
953,107
267,684
Equity, at fair value
200
209
197
225
250
3,289,530
3,116,249
3,076,275
2,887,435
3,046,500
Loans held for sale
982,616
1,003,605
1,491,579
1,643,994
1,878,190
Loans held for investment, net of unearned
income
8,092,673
7,944,246
7,930,619
7,797,903
7,879,904
Allowance for credit losses
(95,442
)
(91,783
)
(95,298
)
(91,185
)
(91,352
)
Loans held for investment, net
7,997,231
7,852,463
7,835,321
7,706,718
7,788,552
Broker-dealer and clearing organization
receivables
1,038,055
1,255,052
1,049,830
1,610,352
1,672,946
Premises and equipment, net
184,950
191,423
195,361
198,906
204,438
Operating lease right-of-use assets
102,443
103,099
106,806
108,180
112,328
Mortgage servicing assets
100,825
156,539
121,688
100,475
86,990
Other assets
527,469
624,235
513,570
546,622
452,880
Goodwill
267,447
267,447
267,447
267,447
267,447
Other intangible assets, net
11,317
12,209
13,182
14,233
15,284
Total assets
$
16,267,852
$
16,615,291
$
16,715,739
$
18,356,956
$
18,689,080
Deposits:
Noninterest-bearing
$
3,968,862
$
4,546,816
$
4,601,643
$
4,694,592
$
4,577,183
Interest-bearing
7,346,887
6,805,198
7,319,143
7,972,110
8,240,894
Total deposits
11,315,749
11,352,014
11,920,786
12,666,702
12,818,077
Broker-dealer and clearing organization
payables
966,470
1,176,156
934,818
1,397,836
1,477,300
Short-term borrowings
970,056
942,309
822,649
835,054
859,444
Securities sold, not yet purchased, at
fair value
53,023
99,515
135,968
97,629
96,586
Notes payable
346,654
390,354
389,722
395,479
387,904
Operating lease liabilities
126,759
120,635
124,406
125,919
130,960
Other liabilities
417,042
475,425
329,987
347,742
369,606
Total liabilities
14,195,753
14,556,408
14,658,336
15,866,361
16,139,877
Common stock
647
646
646
794
790
Additional paid-in capital
1,046,331
1,043,605
1,039,261
1,275,649
1,274,446
Accumulated other comprehensive loss
(124,961
)
(119,864
)
(95,279
)
(80,565
)
(10,219
)
Retained earnings
1,123,636
1,107,586
1,085,208
1,267,415
1,257,014
Deferred compensation employee stock
trust, net
481
479
695
744
752
Employee stock trust
(640
)
(641
)
(954
)
(104
)
(115
)
Total Hilltop stockholders' equity
2,045,494
2,031,811
2,029,577
2,463,933
2,522,668
Noncontrolling interests
26,605
27,072
27,826
26,662
26,535
Total stockholders' equity
2,072,099
2,058,883
2,057,403
2,490,595
2,549,203
Total liabilities & stockholders'
equity
$
16,267,852
$
16,615,291
$
16,715,739
$
18,356,956
$
18,689,080
Three Months Ended
Year Ended
Consolidated Income Statements
December 31,
September 30,
December 31,
December 31,
December 31,
(in 000's, except per share
data)
2022
2022
2021
2022
2021
Interest income:
Loans, including fees
$
117,906
$
109,165
$
96,104
$
416,207
$
404,312
Securities borrowed
14,162
10,938
8,524
44,414
61,667
Securities:
Taxable
23,293
19,642
13,916
75,805
47,633
Tax-exempt
3,002
2,451
2,639
10,013
9,766
Other
21,611
14,276
1,872
44,677
6,595
Total interest income
179,974
156,472
123,055
591,116
529,973
Interest expense:
Deposits
28,238
12,525
4,404
50,412
23,624
Securities loaned
13,179
9,407
6,624
38,570
50,974
Short-term borrowings
10,278
5,550
2,279
20,893
9,065
Notes payable
3,988
3,907
5,871
16,141
21,386
Junior subordinated debentures
—
—
—
—
1,558
Other
849
1,597
(417
)
6,125
384
Total interest expense
56,532
32,986
18,761
132,141
106,991
Net interest income
123,442
123,486
104,294
458,975
422,982
Provision for (reversal of) credit
losses
3,638
(780
)
(18,565
)
8,309
(58,213
)
Net interest income after provision for
(reversal of) credit losses
119,804
124,266
122,859
450,666
481,195
Noninterest income:
Net gains from sale of loans and other
mortgage production income
35,949
57,998
156,103
302,384
825,960
Mortgage loan origination fees
35,198
39,960
35,930
149,598
160,011
Securities commissions and fees
33,143
34,076
32,801
139,122
143,827
Investment and securities advisory fees
and commissions
30,661
35,031
42,834
127,399
152,443
Other
34,833
39,910
17,178
113,957
128,034
Total noninterest income
169,784
206,975
284,846
832,460
1,410,275
Noninterest expense:
Employees' compensation and benefits
167,892
200,450
229,717
773,688
1,007,235
Occupancy and equipment, net
23,077
25,041
25,741
97,115
100,602
Professional services
11,555
10,631
9,904
48,495
54,270
Other
50,844
52,616
56,832
207,701
225,291
Total noninterest expense
253,368
288,738
322,194
1,126,999
1,387,398
Income before income taxes
36,220
42,503
85,511
156,127
504,072
Income tax expense
9,642
9,249
20,715
36,833
117,976
Net income
26,578
33,254
64,796
119,294
386,096
Less: Net income attributable to
noncontrolling interest
1,022
1,186
2,611
6,160
11,601
Income attributable to Hilltop
$
25,556
$
32,068
$
62,185
$
113,134
$
374,495
Earnings per common share:
Basic:
$
0.40
$
0.50
$
0.79
$
1.61
$
4.64
Diluted:
$
0.39
$
0.50
$
0.78
$
1.60
$
4.61
Cash dividends declared per common
share
$
0.15
$
0.15
$
0.12
$
0.60
$
0.48
Weighted average shares outstanding:
Basic
64,602
64,552
78,933
70,434
80,708
Diluted
64,779
64,669
79,427
70,626
81,173
Three Months Ended December
31, 2022
Segment Results
Mortgage
All Other and
Hilltop
(in 000's)
Banking
Broker-Dealer
Origination
Corporate
Eliminations
Consolidated
Net interest income (expense)
$
109,335
$
14,116
$
(4,464
)
$
(3,279
)
$
7,734
$
123,442
Provision for (reversal of) credit
losses
3,925
(287
)
—
—
—
3,638
Noninterest income
11,869
92,803
71,439
1,870
(8,197
)
169,784
Noninterest expense
59,269
87,406
92,532
14,642
(481
)
253,368
Income (loss) before taxes
$
58,010
$
19,800
$
(25,557
)
$
(16,051
)
$
18
$
36,220
Year Ended December 31,
2022
Segment Results
Mortgage
All Other and
Hilltop
(in 000's)
Banking
Broker-Dealer
Origination
Corporate
Eliminations
Consolidated
Net interest income (expense)
$
413,603
$
51,597
$
(10,529
)
$
(13,135
)
$
17,439
$
458,975
Provision for (reversal of) credit
losses
8,250
59
—
—
—
8,309
Noninterest income
49,307
341,943
452,915
7,525
(19,230
)
832,460
Noninterest expense
235,190
355,713
478,904
59,030
(1,838
)
1,126,999
Income (loss) before taxes
$
219,470
$
37,768
$
(36,518
)
$
(64,640
)
$
47
$
156,127
Three Months Ended
Year Ended
December 31,
September 30,
December 31,
December 31,
December 31,
Selected Financial Data
2022
2022
2021
2022
2021
Hilltop
Consolidated:
Return on average stockholders' equity
4.99
%
6.26
%
9.93
%
5.11
%
15.38
%
Return on average assets
0.63
%
0.79
%
1.41
%
0.69
%
2.17
%
Net interest margin (1)
3.23
%
3.19
%
2.44
%
2.87
%
2.57
%
Net interest margin (taxable equivalent)
(2):
As reported
3.24
%
3.20
%
2.45
%
2.88
%
2.58
%
Impact of purchase accounting
7 bps
8 bps
12 bps
7 bps
12 bps
Book value per common share ($)
31.62
31.46
31.95
31.62
31.95
Shares outstanding, end of period
(000's)
64,685
64,591
78,965
64,685
78,965
Dividend payout ratio (3)
37.92
%
30.19
%
15.19
%
37.36
%
10.34
%
Banking
Segment:
Net interest margin (1)
3.42
%
3.42
%
2.81
%
3.11
%
3.07
%
Net interest margin (taxable equivalent)
(2):
As reported
3.43
%
3.43
%
2.82
%
3.11
%
3.08
%
Impact of purchase accounting
8 bps
10 bps
15 bps
9 bps
16 bps
Accretion of discount on loans
($000's)
2,173
2,858
4,716
10,552
18,789
Net recoveries (charge-offs) ($000's)
21
(2,735
)
405
(4,219
)
521
Return on average assets
1.31
%
1.41
%
1.44
%
1.19
%
1.55
%
Fee income ratio
9.8
%
9.9
%
10.8
%
10.7
%
10.0
%
Efficiency ratio
48.9
%
48.9
%
54.2
%
50.8
%
50.3
%
Employees' compensation and benefits
($000's)
34,526
35,934
34,415
137,531
130,276
Broker-Dealer
Segment:
Net revenue ($000's) (4)
106,919
114,184
94,569
393,540
424,421
Employees' compensation and benefits
($000's)
60,552
70,274
65,301
251,145
276,176
Variable compensation expense ($000's)
32,042
42,567
35,939
138,705
161,264
Compensation as a % of net revenue
56.6
%
61.5
%
69.1
%
63.8
%
65.1
%
Pre-tax margin (5)
18.5
%
15.3
%
1.8
%
9.6
%
10.3
%
Mortgage
Origination Segment:
Mortgage loan originations - volume
($000's):
Home purchases
1,895,731
2,832,136
3,559,137
10,823,002
14,429,190
Refinancings
147,511
211,075
1,430,369
1,837,154
8,239,093
Total mortgage loan originations -
volume
2,043,242
3,043,211
4,989,506
12,660,156
22,668,283
Mortgage loan sales - volume ($000's)
2,038,990
3,419,950
4,988,538
13,200,471
23,059,160
Net gains from mortgage loan sales (basis
points):
Loans sold to third parties
211
227
362
263
375
Impact of loans retained by banking
segment
(19
)
(9
)
(15
)
(11
)
(13
)
As reported
192
218
347
252
362
Mortgage servicing rights asset ($000's)
(6)
100,825
156,539
86,990
100,825
86,990
Employees' compensation and benefits
($000's)
64,940
86,079
121,758
353,973
568,221
Variable compensation expense ($000's)
26,724
44,312
73,208
183,804
373,929
___________________
(1)
Net interest margin is defined as net
interest income divided by average interest-earning assets.
(2)
Net interest margin (taxable equivalent),
a non-GAAP measure, is defined as taxable equivalent net interest
income divided by average interest-earning assets. Taxable
equivalent adjustments are based on the applicable 21% federal
income tax rate for all periods presented. The interest income
earned on certain earning assets is completely or partially exempt
from federal income tax. As such, these tax-exempt instruments
typically yield lower returns than taxable investments. To provide
more meaningful comparisons of net interest margins for all earning
assets, we use net interest income on a taxable-equivalent basis in
calculating net interest margin by increasing the interest income
earned on tax-exempt assets to make it fully equivalent to interest
income earned on taxable investments. The taxable equivalent
adjustments to interest income for Hilltop (consolidated) were $0.3
million, $0.4 million, $0.5 million, $1.6 million and $1.7 million,
respectively, for the periods presented and for the banking segment
were $0.2 million for each of the periods presented.
(3)
Dividend payout ratio is defined as cash
dividends declared per common share divided by basic earnings per
common share.
(4)
Net revenue is defined as the sum of total
broker-dealer net interest income and total broker-dealer
noninterest income.
(5)
Pre-tax margin is defined as income before
income taxes divided by net revenue.
(6)
Reported on a consolidated basis and
therefore does not include mortgage servicing rights assets related
to loans serviced for the banking segment, which are eliminated in
consolidation.
December 31,
September 30,
June 30,
March 31,
December 31,
Capital Ratios
2022
2022
2022
2022
2021
Tier 1 capital (to average assets):
PlainsCapital
10.26
%
10.29
%
9.67
%
9.74
%
10.20
%
Hilltop
11.47
%
11.41
%
10.53
%
12.46
%
12.58
%
Common equity Tier 1 capital (to
risk-weighted assets):
PlainsCapital
14.97
%
14.68
%
14.65
%
15.37
%
16.00
%
Hilltop
18.22
%
17.45
%
17.24
%
21.27
%
21.22
%
Tier 1 capital (to risk-weighted
assets):
PlainsCapital
14.97
%
14.68
%
14.65
%
15.37
%
16.00
%
Hilltop
18.22
%
17.45
%
17.24
%
21.27
%
21.22
%
Total capital (to risk-weighted
assets):
PlainsCapital
15.90
%
15.54
%
15.55
%
16.18
%
16.77
%
Hilltop
20.97
%
20.07
%
19.90
%
23.85
%
23.75
%
December 31,
September 30,
June 30,
March 31,
December 31,
Non-Performing Assets Portfolio
Data
2022
2022
2022
2022
2021
Loans accounted for on a non-accrual basis
($000's) (1):
Commercial real estate
4,269
4,735
4,947
6,153
6,601
Commercial and industrial
9,095
12,078
13,315
18,486
22,478
Construction and land development
1
1
1
1
2
1-4 family residential
16,138
16,968
16,542
18,723
21,123
Consumer
14
16
19
21
23
Broker-dealer
—
—
—
—
—
29,517
33,798
34,824
43,384
50,227
Troubled debt restructurings included in
accruing loans held for investment ($000's)
803
825
857
890
922
Non-performing loans ($000's)
30,320
34,623
35,681
44,274
51,149
Non-performing loans as a % of total
loans
0.33
%
0.39
%
0.38
%
0.47
%
0.52
%
Other real estate owned ($000's)
2,325
1,637
1,516
2,175
2,833
Other repossessed assets ($000's)
—
—
—
—
—
Non-performing assets ($000's)
32,645
36,260
37,197
46,449
53,982
Non-performing assets as a % of total
assets
0.20
%
0.22
%
0.22
%
0.25
%
0.29
%
Loans past due 90 days or more and still
accruing ($000's) (2):
92,099
96,532
82,410
87,489
60,775
___________________
(1)
Loans accounted for on a non-accrual basis
do not include COVID-19 related loan modifications through January
1, 2022. The banking segment’s COVID-19 payment deferment programs
since the second quarter of 2020 allowed for a deferral of
principal and/or interest payments with such deferred principal
payments due and payable on the maturity date of the existing loan.
For the periods presented, the banking segment’s actions through
December 31, 2021 included approval of COVID-19 related loan
modifications, resulting in active loan modifications of
approximately $4 million as of December 31, 2021.
(2)
Loans past due 90 days or more and still
accruing were primarily comprised of loans held for sale and
guaranteed by U.S. government agencies, including loans that are
subject to repurchase, or have been repurchased, by
PrimeLending.
Three Months Ended December
31,
2022
2021
Average
Interest
Annualized
Average
Interest
Annualized
Outstanding
Earned
Yield or
Outstanding
Earned
Yield or
Net Interest Margin (Taxable
Equivalent) Details (1)
Balance
or Paid
Rate
Balance
or Paid
Rate
Assets
Interest-earning assets
Loans held for sale
$
882,322
$
11,634
5.27
%
$
1,852,140
$
13,708
2.96
%
Loans held for investment, gross (2)
7,774,350
106,271
5.42
%
7,695,090
82,396
4.25
%
Investment securities - taxable
2,843,881
23,293
3.28
%
2,677,894
13,916
2.08
%
Investment securities - non-taxable
(3)
354,207
3,286
3.71
%
331,959
3,188
3.84
%
Federal funds sold and securities
purchased under agreements to resell
161,632
2,173
5.33
%
194,351
164
0.33
%
Interest-bearing deposits in other
financial institutions
1,749,902
15,751
3.57
%
2,683,656
943
0.14
%
Securities borrowed
1,350,873
14,162
4.10
%
1,474,421
8,524
2.26
%
Other
56,196
3,686
26.02
%
52,848
765
5.74
%
Interest-earning assets, gross (3)
15,173,363
180,256
4.71
%
16,962,359
123,604
2.89
%
Allowance for credit losses
(92,344
)
(109,555
)
Interest-earning assets, net
15,081,019
16,852,804
Noninterest-earning assets
1,637,295
1,402,216
Total assets
$
16,718,314
$
18,255,020
Liabilities and Stockholders'
Equity
Interest-bearing liabilities
Interest-bearing deposits
$
7,154,802
$
28,238
1.57
%
$
7,901,704
$
4,404
0.22
%
Securities loaned
1,274,038
13,179
4.10
%
1,422,303
6,624
1.85
%
Notes payable and other borrowings
1,355,809
15,114
4.42
%
1,233,924
7,733
2.49
%
Total interest-bearing liabilities
9,784,649
56,531
2.29
%
10,557,931
18,761
0.70
%
Noninterest-bearing liabilities
Noninterest-bearing deposits
4,222,143
4,509,891
Other liabilities
652,900
677,433
Total liabilities
14,659,692
15,745,255
Stockholders’ equity
2,032,287
2,484,301
Noncontrolling interest
26,335
25,464
Total liabilities and stockholders'
equity
$
16,718,314
$
18,255,020
Net interest income (3)
$
123,725
$
104,843
Net interest spread (3)
2.42
%
2.19
%
Net interest margin (3)
3.24
%
2.45
%
Year Ended December
31,
2022
2021
Average
Interest
Annualized
Average
Interest
Annualized
Outstanding
Earned
Yield or
Outstanding
Earned
Yield or
Net Interest Margin (Taxable
Equivalent) Details (1)
Balance
or Paid
Rate
Balance
or Paid
Rate
Assets
Interest-earning assets
Loans held for sale
$
1,221,235
$
52,315
4.28
%
$
2,293,543
$
64,767
2.82
%
Loans held for investment, gross (2)
7,840,848
363,892
4.71
%
7,645,292
339,548
4.44
%
Investment securities - taxable
2,819,282
75,805
2.69
%
2,493,848
47,582
1.91
%
Investment securities - non-taxable
(3)
310,315
11,608
3.74
%
313,703
11,448
3.65
%
Federal funds sold and securities
purchased under agreements to resell
162,575
4,098
2.52
%
152,273
372
0.24
%
Interest-bearing deposits in other
financial institutions
2,306,960
31,705
1.37
%
2,078,666
2,942
0.14
%
Securities borrowed
1,298,276
44,414
3.37
%
1,445,464
61,667
4.21
%
Other
55,280
8,873
16.05
%
50,929
3,332
6.54
%
Interest-earning assets, gross (3)
16,014,771
592,710
3.70
%
16,473,718
531,658
3.23
%
Allowance for credit losses
(92,828
)
(129,689
)
Interest-earning assets, net
15,921,943
16,344,029
Noninterest-earning assets
1,488,994
1,451,928
Total assets
$
17,410,937
$
17,795,957
Liabilities and Stockholders'
Equity
Interest-bearing liabilities
Interest-bearing deposits
$
7,561,501
$
50,412
0.67
%
$
7,722,584
$
23,624
0.31
%
Securities loaned
1,184,498
38,570
3.26
%
1,374,142
50,974
3.71
%
Notes payable and other borrowings
1,293,133
43,158
3.34
%
1,216,381
32,393
2.66
%
Total interest-bearing liabilities
10,039,132
132,140
1.32
%
10,313,107
106,991
1.04
%
Noninterest-bearing liabilities
Noninterest-bearing deposits
4,455,779
4,157,962
Other liabilities
675,629
863,976
Total liabilities
15,170,540
15,335,045
Stockholders’ equity
2,213,756
2,435,185
Noncontrolling interest
26,641
25,727
Total liabilities and stockholders'
equity
$
17,410,937
$
17,795,957
Net interest income (3)
$
460,570
$
424,667
Net interest spread (3)
2.38
%
2.19
%
Net interest margin (3)
2.88
%
2.58
%
___________________
(1)
Information presented on a
consolidated basis.
(2)
Average balance includes
non-accrual loans.
(3)
Presented on a taxable-equivalent
basis with annualized taxable equivalent adjustments based on the
applicable 21% federal income tax rate for the periods presented.
The adjustment to interest income was $0.3 million and $0.5 million
for the three months ended December 31, 2022 and 2021,
respectively, and $1.6 million and $1.7 million for the year ended
December 31, 2022 and 2021, respectively.
Conference Call Information
Hilltop will host a live webcast and conference call at 8:00 AM
Central (9:00 AM Eastern) on Friday, January 27, 2023. Hilltop
President and CEO Jeremy B. Ford and Hilltop CFO William B. Furr
will review fourth quarter and full year 2022 financial results.
Interested parties can access the conference call by dialing
1-844-200-6205 (United States), 1-833-950-0062 (Canada) or
1-929-526-1599 (all other locations) and then using the access code
429656. The conference call also will be webcast simultaneously on
Hilltop’s Investor Relations website
(http://ir.hilltop-holdings.com).
About Hilltop
Hilltop Holdings is a Dallas-based financial holding company.
Its primary line of business is to provide business and consumer
banking services from offices located throughout Texas through
PlainsCapital Bank. PlainsCapital Bank’s wholly owned subsidiary,
PrimeLending, provides residential mortgage lending throughout the
United States. Hilltop Holdings’ broker-dealer subsidiaries,
Hilltop Securities Inc. and Momentum Independent Network Inc.,
provide a full complement of securities brokerage, institutional
and investment banking services in addition to clearing services
and retail financial advisory. At December 31, 2022, Hilltop
employed approximately 4,140 people and operated approximately 360
locations in 47 states. Hilltop Holdings’ common stock is listed on
the New York Stock Exchange under the symbol “HTH.” Find more
information at Hilltop-Holdings.com, PlainsCapital.com,
PrimeLending.com and HilltopSecurities.com.
FORWARD-LOOKING STATEMENTS
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995. These forward-looking statements involve known and unknown
risks, uncertainties and other factors that may cause our actual
results, performance or achievements to be materially different
from any future results, performance or achievements anticipated in
such statements. Forward-looking statements speak only as of the
date they are made and, except as required by law, we do not assume
any duty to update forward-looking statements. Such forward-looking
statements include, but are not limited to, statements concerning
such things as our plans, objectives, strategies, expectations,
intentions and other statements that are not statements of
historical fact, and may be identified by words such as
“anticipates,” “believes,” “building,” “continue,” “could,”
“drive,” “estimates,” “expects,” “extent,” “focus,” “forecasts,”
“goal,” “guidance,” “intends,” “may,” “might,” “outlook,” “plan,”
“position,” “probable,” “progressing,” “projects,” “prudent,”
“seeks,” “should,” “target,” “view,” “will” or “would” or the
negative of these words and phrases or similar words or phrases.
The following factors, among others, could cause actual results to
differ materially from those set forth in the forward-looking
statements: (i) the credit risks of lending activities, including
our ability to estimate credit losses and the allowance for credit
losses, as well as the effects of changes in the level of, and
trends in, loan delinquencies and write-offs; (ii) effectiveness of
our data security controls in the face of cyber attacks; (iii)
changes in general economic, market and business conditions in
areas or markets where we compete, including changes in the price
of crude oil; (iv) changes in the interest rate environment; and
(v) risks associated with concentration in real estate related
loans. For further discussion of such factors, see the risk factors
described in our most recent Annual Report on Form 10-K and
subsequent Quarterly Reports on Form 10-Q and other reports that
are filed with the Securities and Exchange Commission. All
forward-looking statements are qualified in their entirety by this
cautionary statement.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230126005878/en/
Investor Relations Contact: Erik Yohe 214-525-4634
eyohe@hilltop-holdings.com
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