Hilltop Holdings Inc. Announces Financial Results for First Quarter 2021

Rhea-AI Summary

Hilltop Holdings Inc. (HTH) reported strong financial results for Q1 2021, with income from continuing operations increasing to $120.3 million, or $1.46 per diluted share, up from $46.5 million or $0.51 per diluted share in Q1 2020. The rise was driven by a 73.3% increase in net gains from mortgage origination, totaling $310.2 million. The company declared a quarterly dividend of $0.12 per share and repurchased 149,878 shares at an average price of $33.01. However, COVID-19 continues to pose operational risks.

Positive

• Income from continuing operations rose to $120.3 million, a 158% increase year-over-year.
• Mortgage origination segment produced $6.2 billion in volume, a 71% increase from last year.
• Noninterest income increased by 53.7% year-over-year to $417.6 million.
• Book value per share improved to $29.41, up from $28.28 at the end of 2020.

Negative

• Noninterest expenses increased by 30.1% year-over-year to $366.7 million.
• Net interest margin decreased slightly to 2.69% from 2.71% in the previous quarter.
• Ongoing impact of COVID-19 on financial performance is uncertain and poses risks.

Hilltop Holdings Inc. (NYSE: HTH) (“Hilltop”) today announced financial results for the first quarter 2021. Hilltop produced income from continuing operations to common stockholders of $120.3 million, or $1.46 per diluted share, for the first quarter of 2021, compared to $46.5 million, or $0.51 per diluted share, for the first quarter of 2020. Hilltop’s financial results from continuing operations for the first quarter of 2021 reflected a significant increase in mortgage origination segment net gains from sale of loans and other mortgage production income, while the first quarter of 2020 results included a build in the allowance for credit losses associated with the impact of macroeconomic forecast assumptions attributable to the market disruption and economic uncertainties caused by COVID-19.

Including income from discontinued operations related to the former insurance business, income applicable to common stockholders was $120.3 million, or $1.46 per diluted share, for the first quarter of 2021, compared to $49.6 million, or $0.55 per diluted share, for the first quarter of 2020.

Hilltop also announced that its Board of Directors declared a quarterly cash dividend of $0.12 per common share, payable on May 28, 2021, to all common stockholders of record as of the close of business on May 14, 2021. Additionally, during the first quarter of 2021, Hilltop paid $5.0 million to repurchase an aggregate of 149,878 shares of its common stock at an average price of $33.01 per share pursuant to the 2021 stock repurchase program. These shares were returned to the pool of authorized but unissued shares of common stock.

The COVID-19 pandemic has negatively impacted financial markets and overall economic conditions, and is expected to continue to have implications on our business and operations. The extent of the impact of COVID-19 on our operational and financial performance for the remainder of 2021 is dependent on certain developments, including, among others, the ongoing distribution and effectiveness of vaccines, government stimulus, the ultimate impact of COVID-19 on our customers and clients, potential further disruption and deterioration in the financial services industry, including the mortgage servicing and commercial paper markets, and additional, or extended, federal, state and local government orders and regulations that might be imposed in response to the pandemic, all of which are uncertain.

Jeremy B. Ford, President and CEO of Hilltop, said, “Hilltop’s results in the first quarter reflect the focus of our teammates across Hilltop on serving our clients and executing on our strategic initiatives. The mortgage origination segment had another exceptional quarter, generating $6.2 billion of production volume, a year-over-year increase of 71%, and $93 million of pre-tax income. The banking segment generated $65 million of pre-tax income, including a $5 million reduction in credit reserves, and delivered an efficiency ratio below 50%. The banking team also continued to support its clients through the origination of approximately $200 million of additional PPP loans, bringing the total PPP originations since the inception of the program to approximately $900 million. Additionally, the broker-dealer segment generated $18 million of pre-tax income, as its structured finance and public finance services businesses produced revenue growth versus the prior year in a very volatile interest rate market.

“Overall, we are very pleased with the strong start to 2021, as our diversified, yet integrated, business model continues to generate solid results for our shareholders. At Hilltop, we are focused on value creation over the long-term and will continue to make investments in people and technology for prudent future growth.”

First Quarter 2021 Highlights for Hilltop:

• For the first quarter of 2021, net gains from sale of loans and other mortgage production income and mortgage loan origination fees within our mortgage origination segment was $310.2 million, compared to $179.0 million in the first quarter of 2020, a 73.3% increase;
  • Mortgage loan origination production volume was $6.2 billion during the first quarter of 2021, compared to $3.6 billion in the first quarter of 2020.
• The reversal of credit losses was $5.1 million during the first quarter of 2021, compared to a reversal of credit losses of $3.5 million in the fourth quarter of 2020;
  • The reversal of credit losses during the first quarter of 2021 primarily reflected improvements in loan portfolio macroeconomic forecast assumptions from the prior quarter, partially offset by slower prepayment assumptions on certain portfolios, changes in risk rating grades and updated realizable values.
• Hilltop’s consolidated annualized return on average assets and return on average equity for the first quarter of 2021 were 2.90% and 20.58%, respectively, compared to 1.47% and 9.38%, respectively, for the first quarter of 2020;
• Hilltop’s book value per common share increased to $29.41 at March 31, 2021, compared to $28.28 at December 31, 2020;
• Hilltop’s total assets were $17.7 billion at March 31, 2021, compared to $16.9 billion at December 31, 2020;
• Loans¹, net of allowance for credit losses, were $7.1 billion at both March 31, 2021 and December 31, 2020;
  • Includes supporting our impacted banking clients through funding of over 3,950 loans through both rounds of the Paycheck Protection Program, or PPP, with a remaining balance of approximately $492 million as of March 31, 2021, compared to approximately $487 million as of December 31, 2020;
  • Through April 16, 2021, the SBA had approved approximately 2,270 initial round PPP forgiveness applications from the Bank totaling approximately $420 million, with PPP loans of approximately $185 million pending SBA review and approval.
• Non-performing loans were $79.9 million, or 0.77% of total loans, at March 31, 2021, compared to $79.9 million, or 0.76% of total loans, at December 31, 2020;
• We further supported our impacted banking clients through the approval of COVID-19 related loan modifications of approximately $1.0 billion, resulting in a portfolio of active deferrals that have not reached the end of their deferral period of approximately $130 million as of March 31, 2021, compared to approximately $240 million in active deferment as of December 31, 2020;
  • While the majority of the portfolio of COVID-19 related loan modifications no longer require deferral, such loans may continue to represent elevated risk, and therefore management continues to monitor these loans;
  • The extent of these loans progressing into non-performing loans during future periods is uncertain.
• Loans held for sale decreased by 8.9% from December 31, 2020 to $2.5 billion at March 31, 2021;
• Total deposits were $11.7 billion at March 31, 2021, compared to $11.2 billion at December 31, 2020;
• Hilltop maintained strong capital levels² with a Tier 1 Leverage Ratio³ of 13.01% and a Common Equity Tier 1 Capital Ratio of 19.63% at March 31, 2021;
• Hilltop’s consolidated net interest margin⁴ decreased to 2.69% for the first quarter of 2021, compared to 2.71% in the fourth quarter of 2020;
• For the first quarter of 2021, noninterest income from continuing operations was $417.6 million, compared to $271.7 million in the first quarter of 2020, a 53.7% increase;
• For the first quarter of 2021, noninterest expense from continuing operations was $366.7 million, compared to $281.9 million in the first quarter of 2020, a 30.1% increase; and
• Hilltop’s effective tax rate from continuing operations was 23.4% during the first quarter of 2021, compared to 23.1% during the same period in 2020.

Discontinued Operations

On June 30, 2020, Hilltop completed the sale of National Lloyds Corporation, or NLC, which comprised the operations of its former insurance segment, for cash proceeds of $154.1 million. During 2020, Hilltop recognized an aggregate gain associated with this transaction of $36.8 million, net of transaction costs. Accordingly, insurance segment results and its assets and liabilities have been presented as discontinued operations. The resulting book gain from this sale transaction was not recognized for tax purposes pursuant to the rules promulgated under the Internal Revenue Code.

_________________________________
Note: “Consolidated” refers to our consolidated financial position and consolidated results of operations, including discontinued operations and assets and liabilities of discontinued operations.
¹ “Loans” reflect loans held for investment excluding broker-dealer margin loans, net of allowance for credit losses, of $519.9 million and $436.8 million at March 31, 2021 and December 31, 2020, 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		March 31,			December 31,			September 30,			June 30,			March 31,
(in 000's)		2021			2020			2020			2020			2020
Cash and due from banks		$	1,564,489		$	1,062,560		$	1,277,865		$	1,655,492		$	524,370
Federal funds sold			396			386			420			385			401
Assets segregated for regulatory purposes			273,393			290,357			221,621			194,626			178,805
Securities purchased under agreements to resell			106,342			80,319			90,103			161,457			23,356
Securities:
Trading, at fair value			528,712			694,255			667,751			648,037			393,581
Available for sale, at fair value, net			1,715,406			1,462,205			1,310,240			1,091,348			972,318
Held to maturity, at amortized cost, net			300,088			311,944			323,299			343,198			355,110
Equity, at fair value			189			140			117			122			107
			2,544,395			2,468,544			2,301,407			2,082,705			1,721,116
Loans held for sale			2,538,986			2,788,386			2,547,975			2,592,307			2,433,407
Loans held for investment, net of unearned income			7,810,657			7,693,141			7,945,560			7,849,904			7,345,250
Allowance for credit losses			(144,499)			(149,044)			(155,214)			(156,383)			(106,739)
Loans held for investment, net			7,666,158			7,544,097			7,790,346			7,693,521			7,238,511
Broker-dealer and clearing organization receivables			1,596,817			1,404,727			1,363,478			1,222,627			1,838,789
Premises and equipment, net			213,304			211,595			208,078			210,975			215,261
Operating lease right-of-use assets			101,055			105,757			109,354			119,954			113,395
Mortgage servicing assets			142,125			143,742			127,712			81,264			30,299
Other assets			648,895			555,983			607,932			627,982			846,316
Goodwill			267,447			267,447			267,447			267,447			267,447
Other intangible assets, net			19,035			20,364			21,814			23,374			25,019
Assets of discontinued operations			—			—			—			—			249,758
Total assets		$	17,682,837		$	16,944,264		$	16,935,552		$	16,934,116		$	15,706,250
Deposits:
Noninterest-bearing		$	4,031,181		$	3,612,384		$	3,557,603		$	3,467,500		$	2,865,192
Interest-bearing			7,701,598			7,629,935			7,704,312			8,182,098			7,082,297
Total deposits			11,732,779			11,242,319			11,261,915			11,649,598			9,947,489
Broker-dealer and clearing organization payables			1,546,227			1,368,373			1,310,835			1,158,628			1,259,181
Short-term borrowings			676,652			695,798			780,109			720,164			1,329,948
Securities sold, not yet purchased, at fair value			97,055			79,789			56,023			55,340			22,768
Notes payable			401,713			381,987			396,006			450,158			244,042
Operating lease liabilities			120,339			125,450			122,402			131,411			124,123
Junior subordinated debentures			67,012			67,012			67,012			67,012			67,012
Other liabilities			595,045			632,889			502,517			409,672			408,224
Liabilities of discontinued operations			—			—			—			—			139,730
Total liabilities			15,236,822			14,593,617			14,496,819			14,641,983			13,542,517
Common stock			823			822			902			902			901
Additional paid-in capital			1,319,518			1,317,929			1,443,588			1,439,686			1,437,301
Accumulated other comprehensive income			3,486			17,763			23,790			23,813			20,939
Retained earnings			1,094,727			986,792			942,461			797,331			676,946
Deferred compensation employee stock trust, net			752			771			774			778			774
Employee stock trust			(121)			(138)			(143)			(150)			(150)
Total Hilltop stockholders' equity			2,419,185			2,323,939			2,411,372			2,262,360			2,136,711
Noncontrolling interests			26,830			26,708			27,361			29,773			27,022
Total stockholders' equity			2,446,015			2,350,647			2,438,733			2,292,133			2,163,733
Total liabilities & stockholders' equity		$	17,682,837		$	16,944,264		$	16,935,552		$	16,934,116		$	15,706,250

		Three Months Ended
Consolidated Income Statements		March 31,			December 31,			September 30,			June 30,			March 31,
(in 000's, except per share data)		2021			2020			2020			2020			2020
Interest income:
Loans, including fees		$	104,277		$	109,328		$	104,955		$	107,860		$	111,168
Securities borrowed			28,972			14,445			10,705			12,883			13,327
Securities:
Taxable			10,251			9,845			11,035			11,698			15,695
Tax-exempt			2,102			1,862			1,687			1,539			1,610
Other			1,321			1,381			1,446			951			3,075
Total interest income			146,923			136,861			129,828			134,931			144,875
Interest expense:
Deposits			7,741			9,269			10,700			11,947			15,124
Securities loaned			25,486			12,014			8,729			10,796			11,277
Short-term borrowings			2,013			2,154			2,346			2,367			4,744
Notes payable			4,797			4,807			4,904			3,768			2,418
Junior subordinated debentures			562			609			608			705			850
Other			642			636			641			790			126
Total interest expense			41,241			29,489			27,928			30,373			34,539
Net interest income			105,682			107,372			101,900			104,558			110,336
Provision for (reversal of) credit losses			(5,109)			(3,482)			(602)			66,026			34,549
Net interest income after provision for (reversal of) credit losses			110,791			110,854			102,502			38,532			75,787
Noninterest income:
Net gains from sale of loans and other mortgage production income			267,080			247,360			307,896			295,317			150,486
Mortgage loan origination fees			43,155			50,193			47,681			45,341			28,554
Securities commissions and fees			38,314			35,921			32,496			34,234			40,069
Investment and securities advisory fees and commissions			27,695			42,161			36,866			29,120			23,180
Other			41,341			72,296			77,772			64,113			29,424
Total noninterest income			417,585			447,931			502,711			468,125			271,713
Noninterest expense:
Employees' compensation and benefits			270,353			291,489			294,907			276,893			196,356
Occupancy and equipment, net			24,429			27,596			26,124			26,174			19,522
Professional services			13,585			21,927			17,522			15,737			14,798
Other			58,295			61,336			60,792			51,405			51,225
Total noninterest expense			366,662			402,348			399,345			370,209			281,901
Income from continuing operations before income taxes			161,714			156,437			205,868			136,448			65,599
Income tax expense			37,770			39,295			46,820			31,808			15,148
Income from continuing operations			123,944			117,142			159,048			104,640			50,451
Income from discontinued operations, net of income taxes			—			3,734			736			30,775			3,151
Net income			123,944			120,876			159,784			135,415			53,602
Less: Net income attributable to noncontrolling interest			3,599			4,431			6,505			6,939			3,966
Income attributable to Hilltop		$	120,345		$	116,445		$	153,279		$	128,476		$	49,636
Earnings per common share:
Basic:
Earnings from continuing operations		$	1.46		$	1.31		$	1.69		$	1.08		$	0.51
Earnings from discontinued operations			—			0.04			0.01			0.34			0.04
		$	1.46		$	1.35		$	1.70		$	1.42		$	0.55
Diluted:
Earnings from continuing operations		$	1.46		$	1.30		$	1.69		$	1.08		$	0.51
Earnings from discontinued operations			—			0.05			0.01			0.34			0.04
		$	1.46		$	1.35		$	1.70		$	1.42		$	0.55
Cash dividends declared per common share		$	0.12		$	0.09		$	0.09		$	0.09		$	0.09
Weighted average shares outstanding:
Basic			82,169			86,269			90,200			90,164			90,509
Diluted			82,657			86,420			90,200			90,164			90,550

		Three Months Ended March 31, 2021
Segment Results								Mortgage						All Other and			Continuing
(in 000's)		Banking			Broker-Dealer			Origination			Corporate			Eliminations			Operations
Net interest income (expense)		$	103,884		$	10,514		$	(7,098)		$	(4,692)		$	3,074		$	105,682
Provision for (reversal of) credit losses			(5,175)			66			—			—			—			(5,109)
Noninterest income			11,324			98,623			310,444			506			(3,312)			417,585
Noninterest expense			55,788			91,404			210,334			9,588			(452)			366,662
Income (loss) from continuing operations before taxes		$	64,595		$	17,667		$	93,012		$	(13,774)		$	214		$	161,714

				Three Months Ended
				March 31,			December 31,			September 30,			June 30,			March 31,
		Selected Financial Data		2021			2020			2020			2020			2020
		Hilltop Consolidated (1):
		Return on average stockholders' equity			20.58%			20.56%			25.94%			23.32%			9.38%
		Return on average assets			2.90%			2.83%			3.71%			3.30%			1.47%
		Net interest margin (2)			2.69%			2.71%			2.56%			2.80%			3.41%
		Net interest margin (taxable equivalent) (3):
		As reported			2.69%			2.72%			2.57%			2.81%			3.42%
		Impact of purchase accounting			13 bps			15 bps			10 bps			10 bps			22 bps
		Book value per common share ($)			29.41			28.28			26.72			25.08			23.71
		Shares outstanding, end of period (000's)			82,261			82,185			90,238			90,222			90,108
		Dividend payout ratio (4)			8.19%			6.67%			5.30%			6.32%			16.41%
		Banking Segment:
		Net interest margin (2)			3.30%			3.37%			3.03%			3.11%			3.81%
		Net interest margin (taxable equivalent) (3):
		As reported			3.31%			3.38%			3.03%			3.12%			3.82%
		Impact of purchase accounting			17 bps			20 bps			13 bps			12 bps			30 bps
		Accretion of discount on loans ($000's)			4,851			5,629			3,346			3,217			6,639
		Net recoveries (charge-offs) ($000's)			564			(2,688)			(567)			(16,382)			(1,508)
		Return on average assets			1.48%			1.37%			1.14%			-0.42%			0.33%
		Fee income ratio			9.8%			10.2%			9.2%			10.2%			8.5%
		Efficiency ratio			48.4%			53.0%			52.7%			54.1%			55.5%
		Employees' compensation and benefits ($000's)			30,992			34,007			29,808			31,583			32,347
		Broker-Dealer Segment:
		Net revenue ($000's) (5)			109,137			150,070			149,190			132,624			99,382
		Employees' compensation and benefits ($000's)			66,027			87,469			88,063			79,697			56,550
		Variable compensation expense ($000's)			37,412			60,295			60,774			52,372			32,024
		Compensation as a % of net revenue			60.5%			58.3%			59.0%			60.1%			56.9%
		Pre-tax margin (6)			16.2%			22.8%			23.7%			21.0%			18.3%
		Mortgage Origination Segment:
		Mortgage loan originations - volume ($000's):
		Home purchases			2,902,710			3,683,564			4,183,560			3,204,573			2,341,847
		Refinancings			3,281,395			3,114,630			2,266,793			2,894,486			1,280,741
		Total mortgage loan originations - volume			6,184,105			6,798,194			6,450,353			6,099,059			3,622,588
		Mortgage loan sales - volume ($000's)			6,350,837			6,571,234			6,521,773			5,934,914			3,486,249
		Net gains from mortgage loan sales (basis points):
		As reported			388			448			440			368			325
		Impact of sales to banking segment			(10)			(3)			(1)			(1)			(13)
		Mortgage servicing rights asset ($000's) (7)			142,125			143,742			127,712			81,263			30,299
		Employees' compensation and benefits ($000's)			166,248			163,822			161,738			160,824			100,328
		Variable compensation expense ($000's)			115,486			116,736			116,275			113,826			58,280
		________________________________
		(1) Ratios and financial data presented on a consolidated basis. For all 2020 periods presented, information includes discontinued operations and as of March 31, 2020 those assets and liabilities of discontinued operations
		(2) Net interest margin is defined as net interest income divided by average interest-earning assets.
		(3) 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 $0.2 million, $0.3 million, $0.3 million, $0.3 million, and $0.3 million, respectively, for the periods presented and for the banking segment were $0.2 million, $0.2 million, $0.2 million, $0.2 million, and $0.2 million, respectively, for the periods presented.
		(4) Dividend payout ratio is defined as cash dividends declared per common share divided by basic earnings per common share.
		(5) Net revenue is defined as the sum of total broker-dealer net interest income and total broker-dealer noninterest income.
		(6) Pre-tax margin is defined as income before income taxes divided by net revenue.
		(7) 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.

		March 31,			December 31,			September 30,			June 30,			March 31,
Capital Ratios		2021			2020			2020			2020			2020
Tier 1 capital (to average assets):
PlainsCapital			10.50%			10.44%			10.19%			10.37%			12.06%
Hilltop			13.01%			12.64%			13.03%			12.60%			13.03%
Common equity Tier 1 capital (to risk-weighted assets):
PlainsCapital			14.74%			14.40%			14.64%			14.03%			13.33%
Hilltop			19.63%			18.97%			19.85%			18.46%			15.96%
Tier 1 capital (to risk-weighted assets):
PlainsCapital			14.74%			14.40%			14.64%			14.03%			13.33%
Hilltop			20.22%			19.57%			20.46%			19.06%			16.38%
Total capital (to risk-weighted assets):
PlainsCapital			15.64%			15.27%			15.49%			14.88%			14.26%
Hilltop			22.96%			22.34%			23.22%			21.82%			17.00%

		March 31,			December 31,			September 30,			June 30,			March 31,
Non-Performing Assets Portfolio Data		2021			2020			2020			2020			2020
Loans accounted for on a non-accrual basis ($000's) (1):
Commercial real estate			10,668			11,133			14,079			13,743			23,352
Commercial and industrial			36,144			34,049			38,708			32,259			47,121
Construction and land development			501			507			528			1,404			1,402
1-4 family residential			30,937			32,263			28,707			20,552			15,237
Consumer			26			28			53			308			310
Broker-dealer			—			—			—			—			—
			78,276			77,980			82,075			68,266			87,422
Troubled debt restructurings included in accruing loans held for investment ($000's)			1,584			1,954			1,919			2,025			2,286
Non-performing loans ($000's)			79,860			79,934			83,994			70,291			89,708
Non-performing loans as a % of total loans			0.77%			0.76%			0.80%			0.67%			0.92%
Other real estate owned ($000's)			19,899			21,289			25,387			26,602			15,429
Other repossessed assets ($000's)			—			101			239			315			315
Non-performing assets ($000's)			99,759			101,324			109,620			97,208			105,452
Non-performing assets as a % of total assets			0.56%			0.60%			0.65%			0.57%			0.67%
Loans past due 90 days or more and still accruing ($000's)			265,230			243,630			187,105			124,682			101,300
________________________________
(1) Loans accounted for on a non-accrual basis do not include COVID-19 related loan modifications. The Bank’s COVID-19 payment deferral programs allow 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. During the first quarter of 2021, the Bank’s actions included approval of COVID-19 related loan modifications, resulting in active loan modifications of approximately $130 million as of March 31, 2021, down from approximately $240 million as of December 31, 2020. The extent to which these measures will impact the Bank is uncertain, and any progression of loans, whether receiving COVID-19 payment deferrals or not, into non-accrual status, during future periods is uncertain and will depend on future developments that cannot be predicted.

		Three Months Ended March 31,
		2021								2020
		Average			Interest			Annualized		Average			Interest			Annualized
		Outstanding			Earned or			Yield or		Outstanding			Earned or			Yield or
Net Interest Margin (Taxable Equivalent) Details (1)		Balance			Paid			Rate		Balance			Paid			Rate
Assets
Interest-earning assets
Loans held for sale		$	2,573,085		$	16,233		2.52	%	$	1,619,644		$	15,631		3.86	%
Loans held for investment, gross (2)			7,645,883			88,044		4.62	%		7,262,282			95,538		5.23	%
Investment securities - taxable			2,267,709			10,233		1.80	%		1,798,897			16,606		3.69	%
Investment securities - non-taxable (3)			284,001			2,280		3.21	%		208,863			1,902		3.64	%
Federal funds sold and securities purchased under agreements to resell			93,525			—		0.00	%		60,943			134		0.89	%
Interest-bearing deposits in other financial institutions			1,565,879			582		0.15	%		461,775			1,512		1.32	%
Securities borrowed			1,452,704			28,972		7.98	%		1,568,737			13,327		3.36	%
Other			49,916			762		6.18	%		78,595			1,512		7.72	%
Interest-earning assets, gross (3)			15,932,702			147,106		3.70	%		13,059,736			146,162		4.45	%
Allowance for credit losses			(149,397)								(74,430)
Interest-earning assets, net			15,783,305								12,985,306
Noninterest-earning assets			1,559,039								1,633,387
Total assets		$	17,342,344							$	14,618,693
Liabilities and Stockholders' Equity
Interest-bearing liabilities
Interest-bearing deposits		$	7,626,575		$	7,741		0.41	%	$	6,264,827		$	15,125		0.97	%
Securities loaned			1,355,945			25,486		7.62	%		1,474,988			11,277		3.07	%
Notes payable and other borrowings			1,130,068			8,014		2.85	%		1,368,038			8,544		2.50	%
Total interest-bearing liabilities			10,112,588			41,241		1.65	%		9,107,853			34,946		1.54	%
Noninterest-bearing liabilities
Noninterest-bearing deposits			3,729,994								2,730,975
Other liabilities			1,101,972								633,722
Total liabilities			14,944,554								12,472,550
Stockholders’ equity			2,371,281								2,121,877
Noncontrolling interest			26,509								24,266
Total liabilities and stockholders' equity		$	17,342,344							$	14,618,693
Net interest income (3)					$	105,865							$	111,216
Net interest spread (3)								2.05	%							2.91	%
Net interest margin (3)								2.69	%							3.42	%
________________________________
(1) Information presented on a consolidated basis. For the three months ended March 31, 2020, information includes discontinued operations and those assets and liabilities classified of discontinued operations.
(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 rates for the periods presented. The adjustment to interest income was $0.2 million and $0.3 million for the three months ended March 31, 2021 and 2020, respectively.

Conference Call Information

Hilltop will host a live webcast and conference call at 8:00 AM Central (9:00 AM Eastern) on Friday, April 23, 2021. Hilltop President and CEO Jeremy B. Ford and Hilltop CFO William B. Furr will review first quarter 2021 financial results. Interested parties can access the conference call by dialing 1-877-508-9457 (domestic) or 1-412-317-0789 (international). 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 March 31, 2021, Hilltop employed approximately 4,980 people and operated approximately 430 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,” “could,” “estimates,” “expects,” “extent,” “focus,” “forecasts,” “goal,” “guidance,” “intends,” “may,” “might,” “outlook,” “plan,” “probable,” “progressing,” “projects,” “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 COVID-19 pandemic and the response of governmental authorities to the pandemic, which have caused and are causing significant harm to the global economy and our business; (ii) the credit risks of lending activities, including our ability to estimate credit losses, as well as the effects of, and trends in, loan delinquencies and write-offs; (iii) effectiveness of our data security controls in the face of cyber attacks; (iv) changes in general economic, market and business conditions in areas or markets where we compete, including changes in the price of crude oil; (v) risks associated with concentration in real estate related loans; and (vi) changes in the interest rate environment and transitions away from the London Interbank Offered Rate. 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/20210422006088/en/

FAQ

What are Hilltop Holdings' Q1 2021 earnings results?

Hilltop Holdings reported Q1 2021 income from continuing operations of $120.3 million, or $1.46 per diluted share.

When is the dividend payout for Hilltop Holdings?

Hilltop Holdings declared a quarterly dividend of $0.12 per share, payable on May 28, 2021.

How much did Hilltop Holdings spend on stock repurchase in Q1 2021?

In Q1 2021, Hilltop repurchased $5.0 million worth of its common stock.

What is the impact of COVID-19 on Hilltop Holdings' operations?

COVID-19 continues to impact financial markets and presents risks to Hilltop's operational and financial performance.

What were the net gains from mortgage origination for Hilltop Holdings?

Hilltop reported net gains from mortgage origination of $310.2 million in Q1 2021, a 73.3% increase from the previous year.