Published on 19 Apr 2024 on Zacks via Yahoo Finance

Texas Capital (TCBI) Q1 Earnings Beat Estimates, NII Falls Y/Y

Texas Capital Bancshares, Inc. TCBI reported first-quarter 2024 earnings per share of 62 cents (excluding non-recurring items), which beat the Zacks Consensus Estimate of 59 cents. However, earnings compared unfavorably with 70 cents reported in the year-ago quarter.TCBI's results benefitted from an increase in non-interest income and higher loan and deposit balances. Additionally, strong capital position and lower provisions were other positives. However, a decline in net interest income (NII) and an increase in expenses were the undermining factors. Net income available to common shareholders was $21.8 million, plunging 36.4% from the prior-year quarter.

Revenues Decline and Expenses Rise

Total revenues decreased 6% year over year to $256.3 million. The top line surpassed the Zacks Consensus Estimate of $253.3 million.NII was $215 million, which declined 8.6% year over year. The fall was primarily due to an increase in funding costs, partially offset by a rise in yields on average earning assets.NIM of 3.03% during the quarter contracted 30 basis points year over year.Non-interest income increased 10.5% to $41.3 million. The rise was mainly driven by an increase in investment banking and advisory fees.Non-interest expenses increased 4.3% to $202.4 million. The increase was primarily due to a rise in legal and professional costs, communications and technology expenses and FDIC insurance assessment, partly offset by a decline in marketing expenses.As of Mar 31, 2024, total loans increased 2.4% on a sequential basis to $20.83 billion. Total deposits increased 7.1% to $23.9 billion.