Veritex Holdings, Inc. Reports Fourth Quarter and Full Year 2024 Results

Rhea-AI Summary

Veritex Holdings (NASDAQ: VBTX) reported its Q4 and full-year 2024 results, with operating EPS of $2.17 for 2024. The company achieved several key improvements, including a $100 million reduction in criticized loans and decreased commercial real estate concentrations from 320.2% to 298.9% year-over-year.

Q4 2024 highlights include net income of $24.9 million ($0.45 per diluted share), net interest income of $96.1 million, and a net interest margin of 3.20%. Total deposits grew by $414.4 million (4.0%) year-over-year, while total loans held for investment decreased by $307.4 million (3.3%). The company maintained strong credit quality with an allowance for credit losses ratio of 1.18%.

The Board declared a quarterly cash dividend of $0.20 per share, payable on February 28, 2025.

Positive

• Total deposits increased by $414.4 million (4.0%) year-over-year
• Common equity tier 1 capital improved by 80 bps to 11.09%
• Criticized loans decreased by $100 million during 2024
• Tangible book value per share increased 6.9% during 2024
• Net charge-offs improved to 21 bps from 25 bps year-over-year

Negative

• Net interest margin declined to 3.20% from 3.31% year-over-year
• Operating EPS decreased to $2.17 in 2024 from $2.60 in 2023
• Total loans decreased by $307.4 million (3.3%) year-over-year
• Nonperforming assets increased to 0.62% from 0.52% quarter-over-quarter
• Efficiency ratio deteriorated to 62.62% from 55.82% year-over-year

Insights

Financial Analyst

The Q4 2024 results reveal a strategic transformation at Veritex, with several notable developments worth unpacking. The 4.0% year-over-year deposit growth to $10.75 billion demonstrates strong funding capacity, particularly impressive given the competitive banking environment. The deposit mix shift towards interest-bearing accounts, while pressuring margins, represents a strategic trade-off for stability.

The reduction in commercial real estate (CRE) concentration from 320.2% to 298.9% is particularly significant given regulatory scrutiny of CRE exposures. This proactive de-risking, combined with the 15 basis point improvement in nonperforming assets ratio, strengthens the bank's risk profile.

The securities portfolio restructuring, while resulting in a $4.4 million loss, demonstrates forward-thinking management. The yield improvement from 3.89% to 5.67% on affected securities should enhance earnings power in future quarters. The 178 basis point yield differential represents meaningful earnings potential once fully deployed.

Credit quality metrics show stability with the ACL ratio at 1.18% and net charge-offs at 0.21%, comparing favorably to regional bank peers. The 6.9% increase in tangible book value per share to $21.61 reflects solid capital generation despite market volatility.

The efficiency ratio deterioration to 67.04% warrants monitoring, though some increase was expected given investments in risk management infrastructure. The maintenance of the $0.20 quarterly dividend signals management's confidence in sustained earnings power despite near-term headwinds.

DALLAS, Jan. 28, 2025 (GLOBE NEWSWIRE) -- Veritex Holdings, Inc. (“Veritex”, the “Company”, “we” or “our”) (Nasdaq: VBTX), the holding company for Veritex Community Bank, today announced the results for the fourth quarter and full year of 2024.

“We achieved significant milestones during 2024 as we improved our credit risk profile and strengthened and completed our balance sheet remake,” said C. Malcolm Holland, III, the Company’s Chairman and Chief Executive Officer. “My team and I are committed to continue to drive execution of our strategic plan in 2025. Now it’s back to what we do best; grow profitability.”

2024 Highlights:

• Operating EPS was $2.17 for 2024;
• Criticized loans decreased approximately $100 million during 2024;
• Commercial real estate concentrations decreased from 320.2% for the year ended 2023 to 298.9% for the year ended 2024;
• Nonperforming assets to total loans decreased 15 basis points to 0.62% from 2023;
• Loan to deposit ratio decreased to 89.3% as of December 31, 2024 compared to 93.6% as of December 31, 2023;
• Total deposits grew $414.4 million, or 4.0%, year-over-year;
• Common equity tier 1 capital increased 80 bps to 11.09% as of December 31, 2024 compared to 10.29% as of December 31, 2023;
• Tangible book value per common share increased 6.9%, or $1.40, during 2024 compared to 2023;
• Allowance for credit losses (“ACL”) to total loans increased to 1.18%, or 4 bps, from 1.14% as of December 31, 2023;
• Declared quarterly cash dividend of $0.20 per share of outstanding common stock payable on February 28, 2025;.and
• Named one of the “Best Companies to Work For” by the 2024 Inaugural U.S. News & World Report which evaluates companies based on quality of pay, work/life balance, and opportunities for professional development and advancement.
  
  

		Quarter to Date													Full Year
Financial Highlights		Q4 2024				Q3 2024				Q4 2023						2024				2023
		(Dollars in thousands, except per share data) (unaudited)
GAAP
Net income		$	24,882			$	31,001			$	3,499				$	107,241			$	108,261
Diluted EPS			0.45				0.56				0.06					1.95				1.98
Book value per common share			29.37				29.53				28.18					29.37				28.18
Return on average assets1			0.78	%			0.96	%			0.11	%				0.85	%			0.88	%
Return on average equity1			6.17				7.79				0.92					6.85				7.21
Net interest margin			3.20				3.30				3.31					3.26				3.49
Efficiency ratio			67.04				61.94				77.49					62.62				55.82
Non-GAAP2
Operating earnings		$	29,769			$	32,181			$	31,625				$	119,397			$	142,114
Diluted operating EPS			0.54				0.59				0.58					2.17				2.60
Tangible book value per common share			21.61				21.72				20.21					21.61				20.21
Pre-tax, pre-provision operating earnings			40,945				44,555				47,688					173,576				222,211
Pre-tax, pre-provision operating return on average assets1			1.28	%			1.38	%			1.54	%				1.37	%			1.81	%
Pre-tax, pre-provision operating return on average loans1			1.72				1.83				1.97					1.81				2.32
Operating return on average assets1			0.93				1.00				1.02					0.95				1.16
Return on average tangible common equity1			9.04				11.33				2.00					10.10				10.91
Operating return on average tangible common equity1			10.69				11.74				12.37					11.17				14.09
Operating efficiency ratio			62.98				60.63				55.50					60.22				50.94

¹ Annualized ratio.
² Refer to the section titled “Reconciliation of Non-GAAP Financial Measures” for a reconciliation of these non-generally accepted accounting principles (“GAAP”) financial measures to their most directly comparable GAAP measures.

Results of Operations for the Three Months Ended December 31, 2024

Net Interest Income

For the three months ended December 31, 2024, net interest income before provision for credit losses was $96.1 million and net interest margin was 3.20%, compared to $100.1 million and 3.30%, respectively, for the three months ended September 30, 2024. The $3.9 million decrease, or 3.9%, in net interest income before provision for credit losses was primarily due to a $12.3 million decrease in interest income on loans primarily driven by a decrease in loan yields and average loan balances. This decrease was partially offset by a $1.1 million increase in interest income on debt securities, $6.0 million decrease in interest expense on certificates and other time deposits, $2.4 million decrease in interest expense on transaction and savings deposits during the three months ended December 31, 2024. Net interest margin decreased 10 bps from the three months ended September 30, 2024, primarily due to the decrease in loan yields during the three months ended December 31, 2024, partially offset by an increase in yields on debt securities.

Compared to the three months ended December 31, 2023, net interest income before provision for credit losses for the three months ended December 31, 2024 increased by $608 thousand, or 0.6%. The increase was primarily due to a $4.6 million increase in interest income on debt securities, a $3.7 million increase in interest income in deposits in financial institutions and fed funds sold, a $2.5 million decrease in interest expense on advances from FHLB and a $1.4 million decrease in transaction and savings deposits driven by an decrease in funding costs. The increase in net interest income was partially offset by a $10.4 million decrease in interest income on loans driven by a decrease in loan yields and average balances. Net interest margin decreased 11 bps to 3.20% for the three months ended December 31, 2024 from 3.31% for the three months ended December 31, 2023. The decrease was primarily due to the decrease in loan yields during the three months ended December 31, 2024.

Noninterest Income (Loss)

Noninterest income for the three months ended December 31, 2024 was $10.1 million, a decrease of $3.1 million, or 23.3%, compared to noninterest income of $13.1 million for the three months ended September 30, 2024. The decrease in noninterest income was primarily due to a $4.4 million loss on sales of debt securities as a result of a strategic restructuring in which we sold $188.9 million of lower-yielding AFS securities, at amortized cost, with a 3.89% average yield, and reinvested the proceeds in higher yielding AFS securities with a 5.67% average yield. The decrease was also the result of a decrease of $852 thousand of OREO income, higher amortization of our servicing assets of $829 thousand and a decrease of $681 thousands due to the change in the value of equity securities. The decrease was partially offset by an increase of $4.6 million increase in government guaranteed loan income.

Compared to the three months ended December 31, 2023, noninterest income for the three months ended December 31, 2024 increased $27.8 million, or 156.5%. The increase was primarily due to a $29.4 million loss on equity method investment income related to the write down of our equity method investment in Thrive during the three months ended December 31, 2023 with no corresponding loss recorded during the three months ended December 31, 2024. The Company has no remaining equity method investment in Thrive.

Noninterest Expense

Noninterest expense was $71.2 million for the three months ended December 31, 2024, compared to $70.1 million for the three months ended September 30, 2024, a increase of $1.1 million, or 1.6%. Changes within noninterest expenses items were nominal.

Noninterest expense was $71.2 million for the three months ended December 31, 2024, compared to $60.2 million for the three months ended December 31, 2023, an increase of $11.0 million, or 18.2%. The increase was primarily driven by a $6.8 million increase in salary and employee benefits, a $4.1 million increase in other expenses, a $1.2 million increase in data processing and software expenses, and a $951 thousand increase in marketing expenses. The increase was partially offset by a $2.1 million decrease in professional and regulatory fees.

Financial Condition

Total loans held for investment (“LHI”) was $8.90 billion at December 31, 2024, a decrease of $129.4 million, compared to September 30, 2024, and a decrease of $307.4 million, or 3.3%, compared to December 31, 2023.

Total deposits were $10.75 billion at December 31, 2024, an decrease of $283.4 million compared to September 30, 2024, and an increase of $414.4 million, or 4.0%, compared to December 31, 2023. The decrease from September 30, 2024 was primarily the result of a decrease of $667.1 million in certificates and other time deposits, a decrease of $452.4 million in noninterest-bearing deposits, and a decrease of $20.4 million in correspondent money market accounts. The decrease was partially offset by a increase of $856.4 million in interest-bearing transaction, money market, and savings deposits. The increase from December 31, 2023 was primarily the result of an increase in attractive deposits which consisted of $712.8 million in interest-bearing transaction, money market, and savings deposits. The increase was partially offset by a $232.9 million decrease in certificates and other time deposits, a $38.9 million decrease in correspondent money market accounts, and a $26.6 million decrease in non-interest bearing deposits.

Credit Quality

Nonperforming assets (“NPAs”) increased to $79.2 million, or 0.62% of total assets, at December 31, 2024, compared to $67.3 million, or 0.52% of total assets, at September 30, 2024. Net charge-offs compared to average loans outstanding were 21 bps for the year ended December 31, 2024, compared to 25 bps for year ended December 31, 2023.

ACL as a percentage of LHI was 1.18%, 1.21%, and 1.14% at December 31, 2024, September 30, 2024, and December 31, 2023, respectively. The Company recorded a provision for credit losses of $2.3 million for the three months ended December 31, 2024, compared to a provision for credit losses of $4.0 million and $9.5 million for the three months ended September 30, 2024 and December 31, 2023, respectively. The recorded provision for credit losses reported for the three months ended December 31, 2024, compared to the three months ended December 31, 2023 was primarily attributable to a decrease in the overall loans held for investment balances and changes in general reserves as a result of changes in economic factors. The Company recorded a benefit for unfunded commitments of $401 thousand and $1.5 million during the three months ended December 31, 2024, and December 31, 2023, respectively. There was no provision for unfunded commitments recorded during the three months ended in September 30, 2024. The decrease in the recorded benefit for unfunded commitments during the three months ended December 31, 2024, compared to the three months ended September 30, 2024, was primarily attributable to changes in the economic factors applied to unfunded commitment balances.

Dividend Information

On January 28, 2025, Veritex's Board of Directors declared a quarterly cash dividend of $0.20 per share on its outstanding shares of common stock. The dividend will be paid on February 28, 2025 to stockholders of record as of the close of business on February 14, 2025.

Non-GAAP Financial Measures

Veritex’s management uses certain non-GAAP (U.S. generally accepted accounting principles) financial measures to evaluate its operating performance and provide information that is important to investors. However, non-GAAP financial measures are supplemental and should be viewed in addition to, and not as an alternative for, Veritex’s reported results prepared in accordance with GAAP. Specifically, Veritex reviews and reports tangible book value per common share, operating earnings, tangible common equity to tangible assets, return on average tangible common equity, pre-tax, pre-provision operating earnings, pre-tax, pre-provision operating return on average assets, pre-tax, pre-provision operating return on average loans, diluted operating earnings per share, operating return on average assets, operating return on average tangible common equity and operating efficiency ratio. Veritex has included in this earnings release information related to these non-GAAP financial measures for the applicable periods presented. Please refer to “Reconciliation of Non-GAAP Financial Measures” after the financial highlights at the end of this earnings release for a reconciliation of these non-GAAP financial measures.

Conference Call

The Company will host an investor conference call to review the results on Wednesday, January 29, 2025 at 8:30 a.m. Central Time. Participants may pre-register for the call by visiting https://edge.media-server.com/mmc/p/8uwctr48 and will receive a unique PIN, which can be used when dialing in for the call.

Participants may also register via teleconference at:
https://register.vevent.com/register/BIf4f4afb9195448ba90575ac59fb337bc. Once registration is completed, participants will be provided with a dial-in number containing a personalized conference code to access the call. All participants are instructed to dial-in 15 minutes prior to the start time.

A replay will be available within approximately two hours after the completion of the call, and made accessible for one week. You may access the replay via webcast through the investor relations section of Veritex’s website.

About Veritex Holdings, Inc.

Headquartered in Dallas, Texas, Veritex is a bank holding company that conducts banking activities through its wholly-owned subsidiary, Veritex Community Bank, with locations throughout the Dallas-Fort Worth metroplex and in the Houston metropolitan area. Veritex Community Bank is a Texas state chartered bank regulated by the Texas Department of Banking and the Board of Governors of the Federal Reserve System. For more information, visit www.veritexbank.com.

Forward-Looking Statements

This earnings release includes “forward-looking statements”, within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on various facts and derived utilizing assumptions, current expectations, estimates and projections and are subject to known and unknown risks, uncertainties and other factors, which change over time and are beyond our control, that may cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Forward-looking statements include, without limitation, statements relating to the expected payment of Veritex’s quarterly cash dividend; the impact of certain changes in Veritex’s accounting policies, standards and interpretations; a continuation of recent turmoil in the banking industry, responsive measures to mitigate and manage it and related supervisory and regulatory actions and costs and Veritex’s future financial performance, business and growth strategy, projected plans and objectives, as well as other projections based on macroeconomic and industry trends, which are inherently unreliable due to the multiple factors that impact broader economic and industry trends, and any such variations may be material. Statements preceded by, followed by or that otherwise include the words “believes,” “expects,” “anticipates,” “intends,” “projects,” “estimates,” “seeks,” “targets,” “outlooks,” “plans” and similar expressions or future or conditional verbs such as “will,” “should,” “would,” “may” and “could” are generally forward-looking in nature and not historical facts, although not all forward-looking statements include the foregoing words. 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-K for the year ended December 31, 2023 and any updates to those risk factors set forth in Veritex’s Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and other filings with the Securities and Exchange Commission (“SEC”), which are available on the SEC’s website at www.sec.gov. If one or more events related to these or other risks or uncertainties materialize, or if Veritex’s underlying assumptions prove to be incorrect, actual results may differ materially from what Veritex anticipates. Accordingly, you should not place undue reliance on any such forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made. Veritex does not undertake any obligation, and specifically declines any obligation, to supplement, update or revise any forward-looking statements, whether as a result of new information, future developments or otherwise, except as required by law. All forward-looking statements, expressed or implied, included in this earnings release are expressly qualified in their entirety by this cautionary statement. This cautionary statement should also be considered in connection with any subsequent written or oral forward-looking statements that Veritex or persons acting on Veritex’s behalf may issue.

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

		For the Quarter Ended																				For the Year Ended
		Dec 31, 2024				Sep 30, 2024				Jun 30, 2024				Mar 31, 2024				Dec 31, 2023				Dec 31, 2024				Dec 31, 2023
		(Dollars and shares in thousands, except per-share data)
Per Share Data (Common Stock):
Basic EPS		$	0.46			$	0.57			$	0.50			$	0.44			$	0.06			$	1.97			$	2.00
Diluted EPS			0.45				0.56				0.50				0.44				0.06				1.95				1.98
Book value per common share			29.37				29.53				28.49				28.23				28.18				29.37				28.18
Tangible book value per common share1			21.61				21.72				20.62				20.33				20.21				21.61				20.21
Dividends paid per common share outstanding2			0.20				0.20				0.20				0.20				0.20				0.80				0.80
Common Stock Data:
Shares outstanding at period end			54,517				54,446				54,350				54,496				54,338				54,517				54,338
Weighted average basic shares outstanding for the period			54,489				54,409				54,457				54,444				54,327				54,450				54,256
Weighted average diluted shares outstanding for the period			55,237				54,932				54,823				54,842				54,691				54,958				54,596
Summary of Credit Ratios:
ACL to total LHI			1.18	%			1.21	%			1.16	%			1.15	%			1.14	%			1.18	%			1.14	%
NPAs to total assets			0.62				0.52				0.65				0.82				0.77				0.62				0.77
NPAs to total loans and OREO			0.83				0.70				0.85				1.06				1.00				0.83				1.00
Net charge-offs to average loans outstanding3			0.32				0.01				0.28				0.22				0.40				0.21				0.25
Summary Performance Ratios:
Return on average assets3			0.78	%			0.96	%			0.87	%			0.79	%			0.11	%			0.85	%			0.88	%
Return on average equity3			6.17				7.79				7.10				6.33				0.92				6.85				7.21
Return on average tangible common equity1, 3			9.04				11.33				10.54				9.52				2.00				10.10				10.91
Efficiency ratio			67.04				61.94				59.11				62.45				77.49				62.62				55.82
Net interest margin			3.20				3.30				3.29				3.24				3.31				3.26				3.49
Selected Performance Metrics - Operating:
Diluted operating EPS1		$	0.54			$	0.59			$	0.52			$	0.53			$	0.58			$	2.17			$	2.60
Pre-tax, pre-provision operating return on average assets1, 3			1.28	%			1.38	%			1.42	%			1.42	%			1.54	%			1.37	%			1.81	%
Pre-tax, pre-provision operating return on average loans1, 3			1.72				1.83				1.83				1.84				1.97				1.81				2.32
Operating return on average assets1,3			0.93				1.00				0.91				0.95				1.02				0.95				1.16
Operating return on average tangible common equity1,3			10.69				11.74				10.94				11.34				12.37				11.17				14.09
Operating efficiency ratio1			62.98				60.63				58.41				58.73				55.50				60.22				50.94
Risk weighted assets		$	11,247,813			$	11,290,800			$	11,450,997			$	11,407,446			$	11,387,825			$	11,247,813			$	11,387,825
Veritex Holdings, Inc. Capital Ratios:
Average stockholders' equity to average total assets			12.58	%			12.31	%			12.26	%			12.43	%			12.27	%			12.40	%			12.22	%
Tangible common equity to tangible assets1			9.54				9.37				9.14				9.02				9.18				9.54				9.18
Tier 1 capital to average assets (leverage)			10.32				10.06				10.06				10.12				10.03				10.32				10.03
Common equity tier 1 capital			11.09				10.86				10.49				10.37				10.29				11.09				10.29
Tier 1 capital to risk-weighted assets			11.36				11.13				10.75				10.63				10.56				11.36				10.56
Total capital to risk-weighted assets			13.96				13.91				13.45				13.33				13.18				13.96				13.18

¹ Refer to the section titled “Reconciliation of Non-GAAP Financial Measures” after the financial highlights for a reconciliation of these non-GAAP financial measures to their most directly comparable GAAP measures.
² Dividend amount represents dividend paid per common share subsequent to each respective quarter end.
³ Annualized ratio for quarterly metrics.

VERITEX HOLDINGS, INC. AND SUBSIDIARIES
Financial Highlights
(In thousands)

		Dec 31, 2024				Sep 30, 2024				Jun 30, 2024				Mar 31, 2024				Dec 31, 2023
		(unaudited)				(unaudited)				(unaudited)				(unaudited)
ASSETS
Cash and due from banks		$	52,486			$	54,165			$	53,462			$	41,884			$	58,914
Interest bearing deposits in other banks			802,714				1,046,625				598,375				698,885				570,149
Cash and cash equivalents		$	855,200			$	1,100,790			$	651,837			$	740,769			$	629,063
Debt securities, net			1,478,538				1,423,610				1,349,354				1,344,930				1,257,042
Other investments			69,638				71,257				75,885				76,788				76,238
Loans held for sale ("LHFS")			89,309				48,496				57,046				64,762				79,072
LHI, mortgage warehouse ("MW")			605,411				630,650				568,047				449,531				377,796
LHI, excluding MW			8,899,133				9,028,575				9,209,094				9,249,551				9,206,544
Total loans			9,593,853				9,707,721				9,834,187				9,763,844				9,663,412
ACL			(111,745	)			(117,162	)			(113,431	)			(112,032	)			(109,816	)
Bank-owned life insurance			85,324				84,776				84,233				85,359				84,833
Bank premises, furniture and equipment, net			113,480				114,202				105,222				105,299				105,727
Other real estate owned ("OREO")			24,737				9,034				24,256				18,445				—
Intangible assets, net of accumulated amortization			28,664				32,825				35,817				38,679				41,753
Goodwill			404,452				404,452				404,452				404,452				404,452
Other assets			226,200				211,471				232,518				241,863				241,633
Total assets		$	12,768,341			$	13,042,976			$	12,684,330			$	12,708,396			$	12,394,337
LIABILITIES AND STOCKHOLDERS’ EQUITY
Deposits:
Noninterest-bearing deposits		$	2,191,457			$	2,643,894			$	2,416,727			$	2,349,211			$	2,218,036
Interest-bearing transaction and savings deposits			5,061,157				4,204,708				3,979,454				4,220,114				4,348,385
Certificates and other time deposits			2,958,861				3,625,920				3,744,596				3,486,805				3,191,737
Correspondent money market deposits			541,117				561,489				584,067				597,690				580,037
Total deposits			10,752,592				11,036,011				10,724,844				10,653,820				10,338,195
Accounts payable and other liabilities			183,944				168,415				180,585				186,027				195,036
Advances from FHLB			—				—				—				100,000				100,000
Subordinated debentures and subordinated notes			230,736				230,536				230,285				230,034				229,783
Total liabilities			11,167,272				11,434,962				11,135,714				11,169,881				10,863,014
Commitments and contingencies
Stockholders’ equity:
Common stock			613				613				612				611				610
Additional paid-in capital			1,328,748				1,324,929				1,321,995				1,319,144				1,317,516
Retained earnings			507,903				493,921				473,801				457,499				444,242
Accumulated other comprehensive loss			(65,076	)			(40,330	)			(76,713	)			(71,157	)			(63,463	)
Treasury stock			(171,119	)			(171,119	)			(171,079	)			(167,582	)			(167,582	)
Total stockholders’ equity			1,601,069				1,608,014				1,548,616				1,538,515				1,531,323
Total liabilities and stockholders’ equity		$	12,768,341			$	13,042,976			$	12,684,330			$	12,708,396			$	12,394,337

VERITEX HOLDINGS, INC. AND SUBSIDIARIES
Financial Highlights
(in thousands, except per share data)

		For the Quarter Ended																		For the Year Ended
		Dec 31, 2024				Sep 30, 2024			Jun 30, 2024			Mar 31, 2024				Dec 31, 2023				Dec 31, 2024				Dec 31, 2023
		(unaudited)				(unaudited)			(unaudited)			(unaudited)				(unaudited)				(unaudited)
Interest income:
Loans, including fees		$	154,998			$	167,261		$	166,979		$	161,942			$	165,443			$	651,180			$	648,245
Debt securities			16,893				15,830			15,408			13,695				12,282				61,826				44,364
Deposits in financial institutions and Fed Funds sold			11,888				12,571			7,722			8,050				8,162				40,231				28,331
Equity securities and other investments			940				1,001			1,138			900				1,717				3,979				5,934
Total interest income			184,719				196,663			191,247			184,587				187,604				757,216				726,874
Interest expense:
Transaction and savings deposits			44,841				47,208			45,619			46,784				46,225				184,452				148,975
Certificates and other time deposits			40,279				46,230			44,811			40,492				40,165				171,812				125,409
Advances from FHLB			130				47			1,468			1,391				2,581				3,036				41,024
Subordinated debentures and subordinated notes			3,328				3,116			3,113			3,114				3,100				12,671				12,352
Total interest expense			88,578				96,601			95,011			91,781				92,071				371,971				327,760
Net interest income			96,141				100,062			96,236			92,806				95,533				385,245				399,114
Provision for credit losses			2,300				4,000			8,250			7,500				9,500				22,050				42,512
(Benefit) provision for unfunded commitments			(401	)			—			—			(1,541	)			(1,500	)			(1,942	)			(2,041	)
Net interest income after provisions			94,242				96,062			87,986			86,847				87,533				365,137				358,643
Noninterest income:
Service charges and fees on deposit accounts			5,612				5,442			4,974			4,896				4,800				20,924				20,248
Loan fees			2,265				3,278			2,207			2,510				1,200				10,260				6,348
Loss on sales of debt securities			(4,397	)			—			—			(6,304	)			—				(10,701	)			(5,321	)
Government guaranteed loan income, net			5,368				780			1,320			2,614				4,378				10,082				19,982
Equity method investment (loss) income			—				—			—			—				(29,417	)			—				(30,589	)
Customer swap income			509				271			326			449				258				1,555				1,633
Other income			699				3,335			1,751			2,497				989				8,282				6,804
Total noninterest income (loss)			10,056				13,106			10,578			6,662				(17,792	)			40,402				19,105
Noninterest expense:
Salaries and employee benefits			37,446				37,370			32,790			33,365				30,606				140,971				122,070
Occupancy and equipment			4,633				4,789			4,585			4,677				4,670				18,684				19,351
Professional and regulatory fees			5,564				4,903			5,617			6,053				7,626				22,137				26,166
Data processing and software expense			5,741				5,268			5,097			4,856				4,569				20,962				18,539
Marketing			2,896				2,781			1,976			1,546				1,945				9,199				8,704
Amortization of intangibles			2,437				2,438			2,438			2,438				2,438				9,751				9,838
Telephone and communications			323				335			365			261				356				1,284				1,551
Other			12,154				12,216			10,273			8,920				8,028				43,563				27,245
Total noninterest expense			71,194				70,100			63,141			62,116				60,238				266,551				233,464
Income before income tax expense			33,104				39,068			35,423			31,393				9,503				138,988				144,284
Income tax expense			8,222				8,067			8,221			7,237				6,004				31,747				36,023
Net income		$	24,882			$	31,001		$	27,202		$	24,156			$	3,499			$	107,241			$	108,261
Basic EPS		$	0.46			$	0.57		$	0.50		$	0.44			$	0.06			$	1.97			$	2.00
Diluted EPS		$	0.45			$	0.56		$	0.50		$	0.44			$	0.06			$	1.95			$	1.98
Weighted average basic shares outstanding			54,489				54,409			54,457			54,444				54,327				54,450				54,256
Weighted average diluted shares outstanding			55,237				54,932			54,823			54,842				54,691				54,958				54,596

 

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

		For the Quarter Ended
		December 31, 2024										September 30, 2024										December 31, 2023
		Average Outstanding Balance				Interest Earned/ Interest Paid			Average Yield/ Rate			Average Outstanding Balance				Interest Earned/ Interest Paid			Average Yield/ Rate			Average Outstanding Balance				Interest Earned/ Interest Paid			Average Yield/ Rate
		(Dollars in thousands)
Assets
Interest-earning assets:
Loans1		$	8,957,193			$	147,782		6.56	%		$	9,184,182			$	159,163		6.89	%		$	9,280,439			$	161,021		6.88	%
LHI, MW			492,372				7,216		5.83				477,592				8,098		6.75				301,345				4,422		5.82
Debt securities			1,458,057				16,893		4.61				1,384,835				15,830		4.55				1,188,776				12,282		4.10
Interest-earning deposits in other banks			971,451				11,888		4.87				924,685				12,571		5.41				587,929				8,162		5.51
Equity securities and other investments			72,223				940		5.18				75,884				1,001		5.25				82,271				1,717		8.28
Total interest-earning assets			11,951,296				184,719		6.15				12,047,178				196,663		6.49				11,440,760				187,604		6.51
ACL			(117,293	)									(115,510	)									(111,937	)
Noninterest-earning assets			916,969										930,250										977,811
Total assets		$	12,750,972									$	12,861,918									$	12,306,634
Liabilities and Stockholders’ Equity
Interest-bearing liabilities:
Interest-bearing demand and savings deposits		$	5,001,159				44,841		3.57	%		$	4,700,196			$	47,208		4.00	%		$	4,547,911				46,225		4.03	%
Certificates and other time deposits			3,319,628				40,279		4.83				3,678,718				46,230		5.00				3,285,164				40,165		4.85
Advances from FHLB and Other			10,598				130		4.88				3,261				47		5.73				182,935				2,581		5.60
Subordinated debentures and subordinated notes			230,633				3,328		5.74				230,393				3,116		5.38				229,648				3,100		5.36
Total interest-bearing liabilities			8,562,018				88,578		4.12				8,612,568				96,601		4.46				8,245,658				92,071		4.43
Noninterest-bearing liabilities:
Noninterest-bearing deposits			2,400,809										2,486,676										2,322,555
Other liabilities			183,810										179,273										228,135
Total liabilities			11,146,637										11,278,517										10,796,348
Stockholders’ equity			1,604,335										1,583,401										1,510,286
Total liabilities and stockholders’ equity		$	12,750,972									$	12,861,918									$	12,306,634
Net interest rate spread2									2.03	%									2.03	%									2.08	%
Net interest income and margin3						$	96,141		3.20	%						$	100,062		3.30	%						$	95,533		3.31	%

¹ Includes average outstanding balances of LHFS of $46.4 million, $54.3 million and $31.2 million for the three months ended December 31, 2024, September 30, 2024 and December 31, 2023, respectively, and average balances of LHI, excluding MW.
² Net interest rate spread is the average yield on interest-earning assets minus the average rate on interest-bearing liabilities.
³ Net interest margin is equal to net interest income divided by average interest-earning assets.

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

		For the Year Ended December 31,
			2024										2023
		Average Outstanding Balance				Interest Earned/ Interest Paid			Average Yield/ Rate			Average Outstanding Balance				Interest Earned/ Interest Paid			Average Yield/ Rate
		(Dollars in thousands)
Assets
Interest-earning assets:
Loans1		$	9,191,753			$	624,853		6.80	%		$	9,244,070			$	628,122		6.79	%
LHI, MW			417,985				26,327		6.30				347,596				20,123		5.79
Debt securities			1,372,812				61,826		4.50				1,173,880				44,364		3.78
Interest-earning deposits in other banks			762,569				40,231		5.28				542,959				28,331		5.22
Equity securities and other investments			75,825				3,979		5.25				120,135				5,934		4.94
Total interest-earning assets			11,820,944				757,216		6.41				11,428,640				726,874		6.36
ACL			(115,259	)									(103,179	)
Noninterest-earning assets			927,178										957,286
Total assets		$	12,632,863									$	12,282,747
Liabilities and Stockholders’ Equity
Interest-bearing liabilities:
Interest-bearing demand and savings deposits		$	4,728,453				184,452		3.90			$	4,197,517				148,975		3.55
Certificates and other time deposits			3,468,448				171,812		4.95				2,977,178				125,409		4.21
Advances from FHLB and Other			55,109				3,036		5.51				873,617				41,024		4.70
Subordinated debentures and subordinated notes			230,264				12,671		5.50				229,268				12,352		5.39
Total interest-bearing liabilities			8,482,274				371,971		4.39				8,277,580				327,760		3.96
Noninterest-bearing liabilities:
Noninterest-bearing deposits			2,397,681										2,309,983
Other liabilities			186,951										193,659
Total liabilities			11,066,906										10,781,222
Stockholders’ equity			1,565,957										1,501,525
Total liabilities and stockholders’ equity		$	12,632,863									$	12,282,747
Net interest rate spread2									2.02	%									2.40	%
Net interest income and margin3						$	385,245		3.26	%						$	399,114		3.49	%

¹Includes average outstanding balances of LHFS of $53.3 million and $25.7 million for the twelve months ended December 31, 2024 and 2023, respectively, and average balances of LHI, excluding MW.
² Net interest rate spread is the average yield on interest-earning assets minus the average rate on interest-bearing liabilities.
³ Net interest margin is equal to net interest income divided by average interest-earning assets.

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

Yield Trend

		For the Quarter Ended
		Dec 31, 2024			Sep 30, 2024			Jun 30, 2024			Mar 31, 2024			Dec 31, 2023
Average yield on interest-earning assets:
Loans1		6.56	%		6.89	%		6.90	%		6.83	%		6.88	%
LHI, MW		5.83			6.75			6.36			6.27			5.82
Total loans		6.53			6.89			6.88			6.81			6.85
Debt securities		4.61			4.55			4.58			4.25			4.10
Interest-bearing deposits in other banks		4.87			5.41			5.54			5.54			5.51
Equity securities and other investments		5.18			5.25			5.80			4.75			8.28
Total interest-earning assets		6.15	%		6.49	%		6.54	%		6.44	%		6.51	%
Average rate on interest-bearing liabilities:
Interest-bearing demand and savings deposits		3.57	%		4.00	%		4.01	%		4.06	%		4.03	%
Certificates and other time deposits		4.83			5.00			5.02			4.96			4.85
Advances from FHLB		4.88			5.73			5.54			5.54			5.60
Subordinated debentures and subordinated notes		5.74			5.38			5.44			5.45			5.36
Total interest-bearing liabilities		4.12	%		4.46	%		4.50	%		4.47	%		4.43	%
Net interest rate spread2		2.03	%		2.03	%		2.04	%		1.97	%		2.08	%
Net interest margin3		3.20	%		3.30	%		3.29	%		3.24	%		3.31	%

¹ Includes average outstanding balances of LHFS of $46.4 million, $54.3 million, $58.5 million, $53.9 million and $31.2 million for the three months ended December 31, 2024, September 30, 2024, June 30, 2024, March 31, 2024 and December 31, 2023, respectively, and average balances of LHI, excluding MW.
² Net interest rate spread is the average yield on interest-earning assets minus the average rate on interest-bearing liabilities.
³ Net interest margin is equal to net interest income divided by average interest-earning assets.

Supplemental Yield Trend

		For the Quarter Ended															For the Year Ended
		Dec 31, 2024			Sep 30, 2024			Jun 30, 2024			Mar 31, 2024			Dec 31, 2023			Dec 31, 2024			Dec 31, 2023
Average cost of interest-bearing deposits		4.07	%		4.44	%		4.46	%		4.43	%		4.38	%		4.35	%		3.82	%
Average costs of total deposits, including noninterest-bearing		3.16			3.42			3.46			3.42			3.37			3.36			2.89

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

LHI and Deposit Portfolio Composition

		Dec 31, 2024							Sep 30, 2024							Jun 30, 2024							Mar 31, 2024							Dec 31, 2023
		(In thousands, except percentages)
LHI1
Commercial and Industrial ("C&I")		$	2,693,538			30.2	%		$	2,728,544			30.2	%		$	2,798,260			30.4	%		$	2,785,987			30.1	%		$	2,752,063			29.9	%
Real Estate:
Owner occupied commercial ("OOCRE")			780,003			8.8				807,223			8.9				806,285			8.7				788,376			8.5				794,088			8.6
Non-owner occupied commercial ("NOOCRE")			2,382,499			26.7				2,338,094			25.9				2,369,848			25.7				2,352,993			25.5				2,350,725			25.5
Construction and land			1,303,711			14.7				1,436,540			15.8				1,536,580			16.7				1,568,257			16.9				1,734,254			18.8
Farmland			31,690			0.4				32,254			0.4				30,512			0.3				30,979			0.3				31,114			0.3
1-4 family residential			957,341			10.7				944,755			10.5				917,402			10.0				969,401			10.5				937,119			10.2
Multi-family residential			750,218			8.4				738,090			8.2				748,740			8.1				751,607			8.1				605,817			6.6
Consumer			9,115			0.1				11,292			0.1				9,245			0.1				8,882			0.1				10,149			0.1
Total LHI1		$	8,908,115			100	%		$	9,036,792			100	%		$	9,216,872			100	%		$	9,256,482			100	%		$	9,215,329			100	%
MW			605,411							630,650							568,047							449,531							377,796
Total LHI1		$	9,513,526						$	9,667,442						$	9,784,919						$	9,706,013						$	9,593,125
Total LHFS			89,309							48,496							57,046							64,762							79,072
Total loans		$	9,602,835						$	9,715,938						$	9,841,965						$	9,770,775						$	9,672,197
Deposits
Noninterest-bearing		$	2,191,457			20.4	%		$	2,643,894			24.0	%		$	2,416,727			22.5	%		$	2,349,211			22.1	%		$	2,218,036			21.5	%
Interest-bearing transaction			839,005			7.8				421,059			3.8				523,272			4.9				724,171			6.8				927,193			8.9
Money market			3,772,964			35.1				3,462,709			31.4				3,268,286			30.5				3,326,742			31.2				3,284,324			31.8
Savings			449,188			4.2				320,940			2.9				187,896			1.8				169,201			1.6				136,868			1.3
Certificates and other time deposits			2,958,861			27.5				3,625,920			32.8				3,744,596			34.9				3,486,805			32.7				3,191,737			30.9
Correspondent money market account			541,117			5.0				561,489			5.1				584,067			5.4				597,690			5.6				580,037			5.6
Total deposits		$	10,752,592			100	%		$	11,036,011			100	%		$	10,724,844			100	%		$	10,653,820			100	%		$	10,338,195			100	%
Total loans to total deposits ratio			89.3	%						88.0	%						91.8	%						91.7	%						93.6	%
Total loans to Deposit Ratio, excluding MW loans and LHFS			82.8	%						81.9	%						85.9	%						86.9	%						89.1	%

¹ Total LHI does not include deferred costs of $9.0 million, $8.2 million, $7.8 million, $6.9 million and $8.8 million at December 31, 2024, September 30, 2024, June 30, 2024, March 31, 2024 and December 31, 2023, respectively.

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

Asset Quality

	For the Quarter Ended																				For the Year Ended
	Dec 31, 2024				Sep 30, 2024				Jun 30, 2024				Mar 31, 2024				Dec 31, 2023				Dec 31, 2024				Dec 31, 2023
	(In thousands, except percentages)
NPAs:
Nonaccrual loans	$	52,521			$	55,335			$	58,537			$	75,721			$	79,133			$	52,521			$	79,133
Nonaccrual PCD loans1		—				70				73				9,419				13,715				—				13,715
Accruing loans 90 or more days past due2		1,914				2,860				143				220				2,975				1,914				2,975
Total nonperforming loans held for investment ("NPLs")		54,435				58,265				58,753				85,360				95,823				54,435				95,823
Other real estate owned ("OREO")		24,737				9,034				24,256				18,445				—				24,737				—
Total NPAs	$	79,172			$	67,299			$	83,009			$	103,805			$	95,823			$	79,172			$	95,823
Charge-offs:
1-4 family residential	$	—			$	—			$	(31	)		$	—			$	(21	)		$	(31	)		$	(21	)
Multifamily		—				—				(198	)			—				(192	)			(198	)			(192	)
OOCRE		—				—				—				(120	)			(364	)			(120	)			(855	)
NOOCRE		(5,113	)			—				(1,969	)			(4,293	)			(5,434	)			(11,375	)			(13,649	)
C&I		(4,586	)			(2,259	)			(5,601	)			(946	)			(3,893	)			(13,392	)			(10,413	)
Consumer		(420	)			(54	)			(30	)			(71	)			(33	)			(575	)			(236	)
Total charge-offs	$	(10,119	)		$	(2,313	)		$	(7,829	)		$	(5,430	)		$	(9,937	)		$	(25,691	)		$	(25,366	)
Recoveries:
1-4 family residential	$	2			$	3			$	—			$	1			$	1			$	6			$	3
OOCRE		—				—				120				—				—				120				—
NOOCRE		1,323				—				—				—				—				1,323				350
C&I		1,047				1,962				361				96				387				3,466				1,165
MW						46				—				—				—				46				—
Consumer		30				33				497				49				34				609				100
Total recoveries	$	2,402			$	2,044			$	978			$	146			$	422			$	5,570			$	1,618
Net charge-offs	$	(7,717	)		$	(269	)		$	(6,851	)		$	(5,284	)		$	(9,515	)		$	(20,121	)		$	(23,748	)
Provision for credit losses	$	2,300			$	4,000			$	8,250			$	7,500			$	9,500			$	22,050			$	42,512
ACL	$	111,745			$	117,162			$	113,431			$	112,032			$	109,816			$	111,745			$	109,816
Asset Quality Ratios:
NPAs to total assets		0.62	%			0.52	%			0.65	%			0.82	%			0.77	%			0.62	%			0.77	%
NPAs, excluding nonaccrual PCD loans, to total assets		0.62				0.52				0.65				0.74				0.66				0.62				0.66
NPAs to total loans and OREO		0.83				0.70				0.85				1.06				1.00				0.83				1.00
NPLs to total LHI		0.57				0.60				0.60				0.88				1.00				0.57				1.00
NPLs, excluding nonaccrual PCD loans, to total LHI		0.57				0.60				0.60				0.78				0.86				0.57				0.86
ACL to total LHI		1.18				1.21				1.16				1.15				1.14				1.18				1.14
ACL to total loans, excluding MW and LHFS		1.25				1.30				1.23				1.21				1.19				1.25				1.19
Net charge-offs to average loans outstanding3		0.32				0.01				0.28				0.22				0.40				0.21				0.25

¹ Nonaccrual PCD loans consist of PCD loans that transitioned upon adoption of ASC 326 Financial Instruments - Credit Losses and were accounted for on a pooled basis that have subsequently been placed on nonaccrual status.
² Accruing loans greater than 90 days past due exclude PCD loans greater than 90 days past due that are accounted for on a pooled basis.
³Annualized ratio for quarterly metrics.

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

We identify certain financial measures discussed in this earnings release as being “non-GAAP financial measures.” In accordance with SEC rules, we classify a financial measure as being a non-GAAP financial measure if that financial measure excludes or includes amounts, or is subject to adjustments that have the effect of excluding or including amounts, that are included or excluded, as the case may be, in the most directly comparable measure calculated and presented in accordance with GAAP, in our statements of income, balance sheets or statements of cash flows. Non-GAAP financial measures do not include operating and other statistical measures or ratios calculated using exclusively either one or both of (i) financial measures calculated in accordance with GAAP and (ii) operating measures or other measures that are not non-GAAP financial measures.

The non-GAAP financial measures that we present in this earnings release should not be considered in isolation or as a substitute for the most directly comparable or other financial measures calculated in accordance with GAAP. Moreover, the manner in which we calculate the non-GAAP financial measures that we present in this earnings release may differ from that of other companies reporting measures with similar names. You should understand how such other financial institutions calculate their financial measures that appear to be similar or have similar names to the non-GAAP financial measures we have discussed in this earnings release when comparing such non-GAAP financial measures.

Tangible Book Value Per Common Share. Tangible book value per common share is a non-GAAP measure generally used by financial analysts and investment bankers to evaluate financial institutions. We calculate: (a) tangible common equity as total stockholders’ equity less goodwill and core deposit intangibles, net of accumulated amortization; and (b) tangible book value per common share as tangible common equity (as described in clause (a)) divided by number of common shares outstanding. For tangible book value per common share, the most directly comparable financial measure calculated in accordance with GAAP is book value per common share.

We believe that this measure is important to many investors in the marketplace who are interested in changes from period to period in book value per common share exclusive of changes in core deposit intangibles. Goodwill and other intangible assets have the effect of increasing total book value while not increasing our tangible book value.

The following table reconciles, as of the dates set forth below, total stockholders’ equity to tangible common equity and presents our tangible book value per common share compared with our book value per common share:

		As of
		Dec 31, 2024				Sep 30, 2024				Jun 30, 2024				Mar 31, 2024				Dec 31, 2023
		(Dollars in thousands, except per share data)
Tangible Common Equity
Total stockholders' equity		$	1,601,069			$	1,608,014			$	1,548,616			$	1,538,515			$	1,531,323
Adjustments:
Goodwill			(404,452	)			(404,452	)			(404,452	)			(404,452	)			(404,452	)
Core deposit intangibles			(18,744	)			(21,182	)			(23,619	)			(26,057	)			(28,495	)
Tangible common equity		$	1,177,873			$	1,182,380			$	1,120,545			$	1,108,006			$	1,098,376
Common shares outstanding			54,517				54,446				54,350				54,496				54,338
Book value per common share		$	29.37			$	29.53			$	28.49			$	28.23			$	28.18
Tangible book value per common share		$	21.61			$	21.72			$	20.62			$	20.33			$	20.21

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

Tangible Common Equity to Tangible Assets. Tangible common equity to tangible assets is a non-GAAP measure generally used by financial analysts and investment bankers to evaluate financial institutions. We calculate: (a) tangible common equity as total stockholders’ equity, less goodwill and core deposit intangibles, net of accumulated amortization; (b) tangible assets as total assets less goodwill and core deposit intangibles, net of accumulated amortization; and (c) tangible common equity to tangible assets as tangible common equity (as described in clause (a)) divided by tangible assets (as described in clause (b)). For tangible common equity to tangible assets, the most directly comparable financial measure calculated in accordance with GAAP is total stockholders’ equity to total assets.

We believe that this measure is important to many investors in the marketplace who are interested in the relative changes from period to period in common equity and total assets, in each case, exclusive of changes in core deposit intangibles. Goodwill and other intangible assets have the effect of increasing both total stockholders’ equity and assets while not increasing our tangible common equity or tangible assets.

The following table reconciles, as of the dates set forth below, total stockholders’ equity to tangible common equity and total assets to tangible assets and presents our tangible common equity to tangible assets:

		As of
		Dec 31, 2024				Sep 30, 2024				Jun 30, 2024				Mar 31, 2024				Dec 31, 2023
		(Dollars in thousands)
Tangible Common Equity
Total stockholders' equity		$	1,601,069			$	1,608,014			$	1,548,616			$	1,538,515			$	1,531,323
Adjustments:
Goodwill			(404,452	)			(404,452	)			(404,452	)			(404,452	)			(404,452	)
Core deposit intangibles			(18,744	)			(21,182	)			(23,619	)			(26,057	)			(28,495	)
Tangible common equity		$	1,177,873			$	1,182,380			$	1,120,545			$	1,108,006			$	1,098,376
Tangible Assets
Total assets		$	12,768,341			$	13,042,976			$	12,684,330			$	12,708,396			$	12,394,337
Adjustments:
Goodwill			(404,452	)			(404,452	)			(404,452	)			(404,452	)			(404,452	)
Core deposit intangibles			(18,744	)			(21,182	)			(23,619	)			(26,057	)			(28,495	)
Tangible Assets		$	12,345,145			$	12,617,342			$	12,256,259			$	12,277,887			$	11,961,390
Tangible Common Equity to Tangible Assets			9.54	%			9.37	%			9.14	%			9.02	%			9.18	%

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

Return on Average Tangible Common Equity. Return on average tangible common equity is a non-GAAP measure generally used by financial analysts and investment bankers to evaluate financial institutions. We calculate: (a) net income available for common stockholders adjusted for amortization of core deposit intangibles (which we refer to as “return”) as net income, plus amortization of core deposit intangibles, less tax benefit at the statutory rate; (b) average tangible common equity as total average stockholders’ equity less average goodwill and average core deposit intangibles, net of accumulated amortization; and (c) return (as described in clause (a)) divided by average tangible common equity (as described in clause (b)). For return on average tangible common equity, the most directly comparable financial measure calculated in accordance with GAAP is return on average equity.

We believe that this measure is important to many investors in the marketplace who are interested in the return on common equity, exclusive of the impact of core deposit intangibles. Goodwill and core deposit intangibles have the effect of increasing total stockholders’ equity while not increasing our tangible common equity. This measure is particularly relevant to acquisitive institutions that may have higher balances in goodwill and core deposit intangibles than non-acquisitive institutions.

The following table reconciles, as of the dates set forth below, average tangible common equity to average common equity and net income available for common stockholders adjusted for amortization of core deposit intangibles, net of taxes to net income and presents our return on average tangible common equity:

		For the Quarter Ended																				For the Year Ended
		Dec 31, 2024				Sep 30, 2024				Jun 30, 2024				Mar 31, 2024				Dec 31, 2023				Dec 31, 2024				Dec 31, 2023
		(Dollars in thousands)
Net income available for common stockholders adjusted for amortization of core deposit intangibles
Net income		$	24,882			$	31,001			$	27,202			$	24,156			$	3,499			$	107,241			$	108,261
Adjustments:
Plus: Amortization of core deposit intangibles			2,437				2,438				2,438				2,438				2,438				9,751				9,752
Less: Tax benefit at the statutory rate			512				512				512				512				512				2,048				2,048
Net income available for common stockholders adjusted for amortization of core deposit intangibles		$	26,807			$	32,927			$	29,128			$	26,082			$	5,425			$	114,944			$	115,965
Average Tangible Common Equity
Total average stockholders' equity		$	1,604,335			$	1,583,401			$	1,541,609			$	1,533,868			$	1,510,286			$	1,565,957			$	1,501,525
Adjustments:
Average goodwill			(404,452	)			(404,452	)			(404,452	)			(404,452	)			(404,452	)			(404,452	)			(404,452	)
Average core deposit intangibles			(20,342	)			(22,789	)			(25,218	)			(27,656	)			(30,093	)			(23,988	)			(33,718	)
Average tangible common equity		$	1,179,541			$	1,156,160			$	1,111,939			$	1,101,760			$	1,075,741			$	1,137,517			$	1,063,355
Return on Average Tangible Common Equity (Annualized)			9.04	%			11.33	%			10.54	%			9.52	%			2.00	%			10.10	%			10.91	%

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

Operating Earnings, Pre-tax, Pre-provision Operating Earnings and performance metrics calculated using Operating Earnings and Pre-tax, Pre-provision Operating Earnings, including Diluted Operating Earnings per Share, Operating Return on Average Assets, Pre-tax, Pre-Provision Operating Return on Average Assets, Operating Return on Average Assets, Pre-tax, Pre-Provision Operating Return on Average Assets, Pre-tax, Pre-Provision Operating Return on Average Loans, Operating Return on Average Tangible Common Equity and Operating Efficiency Ratio. Operating earnings, pre-tax, pre-provision operating earnings and the performance metrics calculated using these metrics, listed below, are non-GAAP measures used by management to evaluate the Company’s financial performance. We calculate (a) operating earnings as net income plus equity method investment write-down, plus FDIC special assessment, plus severance payments, plus loss on sale of debt securities AFS, net, less tax impact of adjustments, plus nonrecurring tax adjustments. We calculate (b) diluted operating earnings per share as operating earnings as described in clause (a) divided by weighted average diluted shares outstanding. We calculate (c) pre-tax, pre-provision operating earnings as operating earnings as described in clause (a) plus provision for income taxes, plus benefit (provision) for credit losses and unfunded commitments. We calculate (d) pre-tax, pre-provision operating return on average assets as pre-tax, pre-provision operating earnings as described in clause (a) divided by total average assets. We calculate (e) operating return on average assets as operating earnings as described in clause (a) divided by total average assets. We calculate (f) operating return on average tangible common equity as operating earnings as described in clause (a), adjusted for the amortization of intangibles and tax benefit at the statutory rate, divided by total average tangible common equity (average stockholders’ equity less average goodwill and average core deposit intangibles, net of accumulated amortization). We calculate (g) operating efficiency ratio as noninterest expense plus adjustments to operating noninterest expense divided by noninterest income plus adjustments to operating noninterest income, plus net interest income

We believe that these measures and the operating metrics calculated utilizing these measures are important to management and many investors in the marketplace who are interested in understanding the ongoing operating performance of the Company and provide meaningful comparisons to its peers.

The following tables reconcile, as of the dates set forth below, operating net income and pre-tax, pre-provision operating earnings and related metrics:

		For the Quarter Ended															For the Year Ended
		Dec 31, 2024			Sep 30, 2024			Jun 30, 2024			Mar 31, 2024			Dec 31, 2023			Dec 31, 2024			Dec 31, 2023
		(Dollars in thousands, except per share data)
Operating Earnings
Net income		$	24,882		$	31,001		$	27,202		$	24,156		$	3,499		$	107,241		$	108,261
Plus: Equity method investment write-down			—			—			—			—			29,417			—			29,417
Plus: FDIC special assessment			—			—			134			—			768			134			768
Plus: Severance payments1			1,545			1,487			613			—			—			3,645			1,950
Plus: Loss on sale of debt securities AFS, net			4,397			—			—			6,304			—			10,701			5,321
Operating pre-tax income			30,824			32,488			27,949			30,460			33,684			121,721			145,717
Less: Tax impact of adjustments			1,248			307			166			1,323			2,059			3,044			3,603
Plus: Nonrecurring tax adjustments			193			—			527			—			—			720			—
Operating earnings		$	29,769		$	32,181		$	28,310		$	29,137		$	31,625		$	119,397		$	142,114
Weighted average diluted shares outstanding			55,237			54,932			54,823			54,842			54,691			54,958			54,596
Diluted EPS		$	0.45		$	0.56		$	0.50		$	0.44		$	0.06		$	1.95		$	1.98
Diluted operating EPS		$	0.54		$	0.59		$	0.52		$	0.53		$	0.58		$	2.17		$	2.60

¹ Severance payments relate to restructurings made during the periods disclosed.

		For the Quarter Ended																				For the Year Ended
(Dollars in thousands)		Dec 31, 2024				Sep 30, 2024				Jun 30, 2024				Mar 31, 2024				Dec 31, 2023				Dec 31, 2024				Dec 31, 2023
Pre-Tax, Pre-Provision Operating Earnings
Net Income		$	24,882			$	31,001			$	27,202			$	24,156			$	3,499			$	107,241			$	108,261
Plus: Provision for income taxes			8,222				8,067				8,221				7,237				6,004				31,747				36,023
Plus: Provision for credit losses and unfunded commitments			1,899				4,000				8,250				5,959				8,000				20,108				40,471
Plus: Severance payments			1,545				1,487				613				—				—				3,645				1,950
Plus: Loss on sale of AFS, net			4,397				—				—				6,304				—				10,701				5,321
Plus: Equity method investment write-down			—				—				—				—				29,417				—				29,417
Plus: FDIC special assessment			—				—				134				—				768				134				768
Net pre-tax, pre-provision operating earnings		$	40,945			$	44,555			$	44,420			$	43,656			$	47,688			$	173,576			$	222,211
Average total assets		$	12,750,972			$	12,861,918			$	12,578,706			$	12,336,042			$	12,306,634			$	12,632,863			$	12,282,747
Pre-tax, pre-provision operating return on average assets1			1.28	%			1.38	%			1.42	%			1.42	%			1.54	%			1.37	%			1.81	%
Average loans		$	9,449,565			$	9,661,774			$	9,765,428			$	9,563,372			$	9,581,784			$	9,609,738			$	9,591,666
Pre-tax, pre-provision operating return on average loans1			1.72	%			1.83	%			1.83	%			1.84	%			1.97	%			1.81	%			2.32	%
Average Total Assets		$	12,750,972			$	12,861,918			$	12,578,706			$	12,336,042			$	12,306,634			$	12,632,863			$	12,282,747
Return on average assets1			0.78	%			0.96	%			0.87	%			0.79	%			0.11	%			0.85	%			0.88	%
Operating return on average assets1			0.93				1.00				0.91				0.95				1.02				0.95				1.16
Operating earnings adjusted for amortization of core deposit intangibles
Operating earnings		$	29,769			$	32,181			$	28,310			$	29,137			$	31,625			$	119,397			$	142,114
Adjustments:
Plus: Amortization of core deposit intangibles			2,437				2,438				2,438				2,438				2,438				9,751				9,752
Less: Tax benefit at the statutory rate			512				512				512				512				512				2,048				2,048
Operating earnings adjusted for amortization of core deposit intangibles		$	31,694			$	34,107			$	30,236			$	31,063			$	33,551			$	127,100			$	149,818
Average Tangible Common Equity
Total average stockholders' equity		$	1,604,335			$	1,583,401			$	1,541,609			$	1,533,868			$	1,510,286			$	1,565,957			$	1,501,525
Adjustments:
Less: Average goodwill			(404,452	)			(404,452	)			(404,452	)			(404,452	)			(404,452	)			(404,452	)			(404,452	)
Less: Average core deposit intangibles			(20,342	)			(22,789	)			(25,218	)			(27,656	)			(30,093	)			(23,988	)			(33,718	)
Average tangible common equity		$	1,179,541			$	1,156,160			$	1,111,939			$	1,101,760			$	1,075,741			$	1,137,517			$	1,063,355
Operating return on average tangible common equity1			10.69	%			11.74	%			10.94	%			11.34	%			12.37	%			11.17	%			14.09	%
Efficiency ratio			67.04	%			61.94	%			59.11	%			62.45	%			77.49	%			62.62	%			55.82	%
Operating efficiency ratio
Net interest income		$	96,141			$	100,062			$	96,236			$	92,806			$	95,533			$	385,245			$	399,114
Noninterest income (loss)			10,056				13,106				10,578				6,662				(17,792	)			40,402				19,105
Plus: Loss on sale of AFS, net			4,397				—				—				6,304				—				10,701				5,321
Plus: Equity method investment write-down			—				—				—				—				29,417				—				29,417
Operating noninterest income			14,453				13,106				10,578				12,966				11,625				51,103				53,843
Noninterest expense			71,194				70,100				63,141				62,116				60,238				266,551				233,464
Less: FDIC special assessment			—				—				134				—				768				134				768
Less: Severance payments			1,545				1,487				613				—				—				3,645				1,950
Operating noninterest expense		$	69,649			$	68,613			$	62,394			$	62,116			$	59,470			$	262,772			$	230,746
Operating efficiency ratio			62.98	%			60.63	%			58.41	%			58.73	%			55.50	%			60.22	%			50.94	%

¹ Annualized ratio for quarterly metrics.

FAQ

What was Veritex Holdings (VBTX) operating EPS for full-year 2024?

Veritex Holdings reported an operating EPS of $2.17 for the full year 2024.

How much did VBTX's total deposits grow in 2024?

VBTX's total deposits grew by $414.4 million, representing a 4.0% increase year-over-year.

What is the quarterly dividend amount announced by VBTX for Q4 2024?

Veritex announced a quarterly cash dividend of $0.20 per share, payable on February 28, 2025.

How did VBTX's net interest margin change in Q4 2024?

VBTX's net interest margin decreased to 3.20% in Q4 2024, down from 3.31% in Q4 2023 and 3.30% in Q3 2024.

What was VBTX's allowance for credit losses ratio at the end of 2024?

VBTX's allowance for credit losses ratio was 1.18% as of December 31, 2024.