Amegy Bancorporation (ABNK) 8-K Southwest Bancorporation of Texas, Inc. Reports Strong Core Growth

EXHIBIT 99.1

October 18, 2004

SOUTHWEST BANCORPORATION OF TEXAS, INC.
REPORTS STRONG CORE GROWTH

Solid Quarter for Loans and Fee Income

3rd Quarter Highlights

• Diluted earnings per common share were $0.28 for the third quarter of 2004, up 21% linked quarter and up 45% compared to the third quarter of 2003.

• Strong growth trends continue:

– Total revenue grew 7.1% linked quarter; 17% versus prior year adjusted for a $2.6 million recovery of valuation allowance on mortgage servicing rights in the 3rd quarter of 2003.

– Average loans held for investment increased 6.9% linked quarter; 20% versus prior year.

– Average deposits increased 1.5% linked quarter; 10% versus prior year.

– Noninterest income increased 11% linked quarter; 19% versus prior year adjusted for the mortgage servicing rights recovery.

• Net interest margin on a taxable-equivalent basis was 4.04% versus 4.09% linked quarter.

• Noninterest expenses grew by 3.8% linked quarter and 4.7% versus prior year, with additional merger efficiencies to be realized in coming quarters.

• Asset quality indicators improved on a linked quarter basis.

• The operational conversion of Lone Star Bank in Dallas was completed September 20.

• The legal merger with Klein Bank was completed October 1; operational merger expected to be completed 1st quarter 2005.

• Southwest Bank of Texas has been named a “Best Place to Work” byHouston Business Journaland was recognized byCIO Magazineas one of the top 100 companies for technology innovation.

     Houston, Texas – Southwest Bancorporation of Texas, Inc. (NASDAQ: SWBT) today reported third quarter results that reflect strong business development activity with significant loan and fee income growth.

     For the quarter ended September 30, 2004, net income was $19.7 million, or $0.28 per diluted common share, compared to $13.4 million for the quarter ended September 30, 2003, or $0.19 per diluted common share. For the nine months ended September 30, 2004, net income was $51.2 million, or $0.73 per diluted common share, compared to $44.4 million, or $0.64 per diluted common share, for the nine months ended September 30, 2003.

     Return on average assets and return on average common shareholders’ equity for the three months ended September 30, 2004 were 1.21% and 14.79% compared to 0.95% and 11.14% for the same period in 2003. For the nine months ended September 30, 2004, return on average assets and return on average common shareholders’ equity were 1.10% and 13.19% compared to 1.13% and 12.72% for the nine months ended September 30, 2003.

     Total revenue for the third quarter of 2004 was $83.9 million, an increase of 17% over the same period in 2003 adjusted for a $2.6 million recovery of valuation allowance on mortgage servicing rights in the third quarter of 2003. For the nine months ended September 30, 2004, total revenue was $238.0 million, a 17% increase over the same period in 2003, as adjusted. Average loans held for investment were $4.03 billion, a 20% increase over the third quarter of 2003. Average deposits were $4.76 billion, an increase of 10% over the comparable period in 2003. Average assets were $6.49 billion, an increase of $881.0 million, or 16%, from the third quarter of 2003.

     “I am quite pleased with our accomplishments this quarter and for the first nine months of the year,” said Paul B. Murphy, Jr., CEO of Southwest Bank of Texas. “Core loan and fee income growth are two areas where our team truly excelled. In addition, asset quality indicators reflect continued good results. Overall, we had a very good third quarter.”

     Murphy noted the legal merger with Klein Bancshares was effective October 1, 2004 with the operational merger scheduled for the first quarter of 2005. This expansion into the high-growth northwest sector of the greater Houston area added 27 branches and $536 million in deposits. As previously announced, the Company issued $75 million in subordinated tier 2 capital qualifying debt and $35 million in tier 1 capital qualifying trust preferred securities during the quarter. The proceeds were used to finance the Klein

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merger as well as to augment the Company’s capital ratios to support its strong loan growth.

     “Among other things, our partnership with Klein has contributed to building a franchise that now has $7.32 billion in assets, $5.34 billion in deposits, 77 locations statewide, approximately 375,000 accounts and over 250,000 customers,” noted Murphy. “This is a remarkable step for our Company which will celebrate its 15th year in 2005.”

Net Interest Income

     Net interest income increased to $58.0 million, a 5.4% increase on a linked quarter basis and 17% higher than the year earlier period.

     The taxable-equivalent net interest margin was 4.04% for the third quarter of 2004, a decrease of 5 basis points from the prior quarter, but an increase of 7 basis points when compared to the third quarter of 2003. Given the increase in tax-free income over the last several quarters and consistent with industry presentation, the net interest margin is now presented on a taxable-equivalent basis. For comparative purposes, historical data in the accompanying financials also reflects this change.

     During the quarter the taxable-equivalent yield on the securities portfolio increased by 19 basis points to 4.11% and the taxable-equivalent yield on the loan portfolio increased by 10 basis points to 5.45%. The cost of funds, including demand deposits, increased by 19 basis points to 0.98% driven primarily by increases in market rates and a greater reliance on wholesale funding to support the strong loan growth experienced during the quarter.

Noninterest Income

     For the three months ended September 30, 2004, noninterest income was $26.0 million, an 11% increase linked quarter and a 19% increase versus prior year, adjusted for a $2.6 million recovery of valuation allowance on mortgage servicing rights recognized in the third quarter of 2003. For the nine months ended September 30, 2004, noninterest income was $71.7 million, an increase of 17% over the comparable period of the prior year adjusted for the mortgage servicing rights valuation recovery, net.

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     Service charges on deposit accounts increased to $11.2 million, a 6.0% increase from the third quarter of 2003. Investment services fee income increased 27% over the third quarter of 2003 and other fee income decreased 9% as a result of the $2.6 million recovery of valuation allowance on mortgage servicing rights taken in 2003. Other operating income increased 20% over the third quarter of 2003 primarily as a result of higher levels of bank-owned life insurance income and equity investments income.

Noninterest Expenses

     Noninterest expenses were $53.8 million for the third quarter of 2004, an increase of $2.0 million, or 3.8%, on a linked quarter basis and an increase of 4.7% from the same period in the prior year. The efficiency ratio was 63.1% as compared to 64.8% in the prior quarter.

     On a linked quarter basis, the primary components of the expense increase were higher occupancy costs, expenses associated with professional services and compliance with the Sarbanes-Oxley Act, and merger-related expenses.

     “I am pleased with the results of the Lone Star conversion which was completed in September. Using one operating platform for Dallas and Houston will enable us to achieve our expense reduction targets resulting from this merger. The Klein conversion will take place in the first quarter of next year and we look forward to achieving those operating efficiencies throughout the course of next year,” said Scott McLean, President.

Asset Quality

     Nonperforming assets declined to $20.2 million from $23.9 million at June 30, 2004. Nonperforming assets were 0.49% of loans and other real estate at September 30, 2004, down from 0.61% on a linked quarter basis and 0.57% at September 30, 2003. Net charge-offs for the quarter were $1.3 million, or 0.13% of average loans, down from $3.6 million or 0.38% of average loans linked quarter. The provision for loan losses was $3.0 million for the quarter. The allowance for loan losses to total loans is 1.19% at September 30, 2004 compared to 1.24% at September 30, 2003 and 1.21% at June 30, 2004.

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Period End Loans, Deposits, Investments, Assets, and Equity

     Loans held for investment were $4.13 billion at September 30, 2004, an increase of 5.7% linked quarter, and a 24% increase from September 30, 2003. Total deposits at September 30, 2004 were $4.80 billion, an increase of 0.5% linked quarter, and an increase of 11% from September 30, 2003. Investment securities were $1.70 billion at September 30, 2004, an increase of 4.8% linked quarter, and an increase of 13% from September 30, 2003. Total assets were $6.63 billion at September 30, 2004, an increase of 4.3% linked quarter, and an increase of 17% from September 30, 2003. Total shareholders’ equity was $549.8 million at September 30, 2004, compared to $480.9 million at September 30, 2003.

     Southwest Bancorporation of Texas, Inc., the parent company of Southwest Bank of Texas NA, is the largest independent bank holding company headquartered in Houston, Texas. The Company focuses on commercial lending, treasury management and investment services for businesses in the southwest, private financial management and trust services for families and individuals, and retail and mortgage banking services. With the legal merger completed with Klein Bank on October 1, 2004, the Company has $7.32 billion in assets, deposits of $5.34 billion and 77 full-service branches located throughout the Houston and Dallas metropolitan areas.

     Consolidated financial information and supplemental unaudited data schedules follow in this release. Exhibits I and II provide additional information on the net interest margin, including average balances and average rates for both assets and liabilities for the periods presented. Exhibit III presents quarterly comparative data. Exhibit IV presents reconcilements of non-GAAP disclosures.

     The Company’s earnings release and the related financial supplement will be available on www.swbanktx.com, the Company’s website, prior to the beginning of the conference call to discuss earnings.

The conference call will be Tuesday, October 19 at 10:30 am CST. The call is available at http://phx.corporate-ir.net/phoenix.zhtml?p=irol-eventDetails&c=99147&eventID=934555 or by dialing 866-238-1667 and referencing “Southwest Bank of Texas Third Quarter Earnings Call.” The webcast will be archived for 90 days in the Investor Relations portion of the Bank’s web site at www.swbanktx.com. A phone archive also can be accessed by calling 888-266-2081 and entering 570445 as the PIN.

The conference call may include a discussion of non-GAAP financial measures, which is qualified by a reconciliation to GAAP included in this news release or otherwise available on the Southwest Bank of Texas website under “Investor Relations.” The conference call may include forward-looking information which, along with the supplementary information and this news release, is subject to the cautionary statement that follows.

Certain of the matters discussed in this press release may constitute forward-looking statements for the purposes of the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended, and as such may involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Southwest Bancorporation of Texas, Inc. (the “Company”) to be materially different from future results, performance or achievements expressed or implied by such

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forward-looking statements. The words “expect,” “anticipated,” “intend,” “plan,” “believe,” “seek,” “estimate,” and similar expressions are intended to identify such forward-looking statements. The Company’s actual results may differ materially from the results anticipated in these forward-looking statements due to a variety of factors, including, without limitation (a) the effects of future economic conditions on the Company and its customers; (b) the costs and effects of litigation and of unexpected or adverse outcomes in such litigation; (c) governmental monetary and fiscal policies, as well as legislative and regulatory changes; (d) the effect of changes in accounting policies and practices, as may be adopted by the regulatory agencies, as well as the Financial Accounting Standards Board and other accounting standard setters; (e) the risks of changes in interest rates on the level and composition of deposits, loan demand, and the values of loan collateral, securities and interest rate protection agreements, as well as interest rate risks; (f) the effects of competition from other commercial banks, thrifts, mortgage banking firms, consumer finance companies, credit unions, securities brokerage firms, insurance companies, money market and other mutual funds and other financial institutions operating in the Company’s market area and elsewhere, including institutions operating locally, regionally, nationally and internationally, together with such competitors offering banking products and services by mail, telephone, computer and the internet; (g) technological changes; (h) acquisition and integration of acquired businesses; (i) the failure of assumptions underlying the establishment of reserves for loan loses and estimations of values of collateral in various financial assets and liabilities; (j) acts of war or terrorism. All written or oral forward-looking statements attributable to the Company are expressly qualified in their entirety by these cautionary statements.

Contacts:

Randy Meyer, EVP & CFO
713-235-8832
rmeyer@swbanktx.com

Sarah Peterson, SVP Investor & Corporate Communications
713-232-1115
speterson@swbanktx.com

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Southwest Bancorporation of Texas, Inc. Consolidated Financial Information (unaudited)

	3Q-04			3Q-03			% change			YTD 04			YTD 03			% change
	(in 000’s except per share data)
Balance sheet averages
Loans held for investment	$	4,027,343		$	3,351,647			20.2	%	$	3,800,036		$	3,233,852			17.5	%
Loans held for sale		96,119			105,064			-8.5	%		98,751			94,972			4.0	%
Investment securities		1,691,472			1,497,754			12.9	%		1,625,592			1,294,037			25.6	%
Securities purchased under resale agreements		2,435			30,000			-91.9	%		8,482			26,044			-67.4	%
Fed funds sold and other interest-earning assets		50,138			90,474			-44.6	%		48,016			70,134			-31.5	%
Total interest-earning assets		5,867,507			5,074,939			15.6	%		5,580,877			4,719,039			18.3	%
Allowance for loan losses		(49,422	)		(41,469	)		19.2	%		(48,288	)		(39,884	)		21.1	%
Cash and due from banks		251,686			257,010			-2.1	%		280,323			262,930			6.6	%
Goodwill		54,998			25,471			115.9	%		51,933			10,301			404.2	%
Core deposit intangibles		10,240			6,327			61.8	%		9,776			2,132			358.5	%
Other assets		355,606			287,289			23.8	%		352,637			289,061			22.0	%
Total assets	$	6,490,615		$	5,609,567			15.7	%	$	6,227,258		$	5,243,579			18.8	%
Noninterest-bearing deposits	$	1,587,990		$	1,342,560			18.3	%	$	1,551,178		$	1,241,765			24.9	%
Interest-bearing demand deposits		71,430			73,142			-2.3	%		67,640			48,020			40.9	%
Savings deposits		2,012,963			1,854,140			8.6	%		1,969,151			1,776,634			10.8	%
Time deposits		1,088,302			1,064,502			2.2	%		1,053,271			998,613			5.5	%
Total deposits		4,760,685			4,334,344			9.8	%		4,641,240			4,065,032			14.2	%
Repurchase agreements and other borrowed funds		1,173,762			771,132			52.2	%		1,041,204			679,889			53.1	%
Other liabilities		27,246			27,493			-0.9	%		26,463			31,675			-16.5	%
Shareholders’ equity		528,922			476,598			11.0	%		518,351			466,983			11.0	%
Total liabilities and shareholders’ equity	$	6,490,615		$	5,609,567			15.7	%	$	6,227,258		$	5,243,579			18.8	%
Income statement data
Interest and fees on loans	$	56,259		$	48,359			16.3	%	$	157,180		$	140,503			11.9	%
Interest on securities		16,143			12,314			31.1	%		45,370			35,754			26.9	%
Interest on fed funds sold and other interest-earning assets		192			303			-36.6	%		500			793			-36.9	%
Total interest income		72,594			60,976			19.1	%		203,050			177,050			14.7	%
Interest on deposits		10,028			9,106			10.1	%		26,506			28,747			-7.8	%
Interest on borrowings		4,590			2,105			118.1	%		10,182			6,281			62.1	%
Total interest expense		14,618			11,211			30.4	%		36,688			35,028			4.7	%
Net interest income		57,976			49,765			16.5	%		166,362			142,022			17.1	%
Provision for loan losses		3,000			3,000			0.0	%		8,000			9,000			-11.1	%
Net interest income after provision		54,976			46,765			17.6	%		158,362			133,022			19.0	%
Service charges on deposit accounts		11,184			10,551			6.0	%		33,414			29,484			13.3	%
Investment services		3,164			2,489			27.1	%		9,019			7,214			25.0	%
Other fee income		6,214			6,816			-8.8	%		16,566			14,423			14.9	%
Other operating income		5,432			4,545			19.5	%		12,713			11,461			10.9	%
Gain (loss) on sales of securities, net		(46	)		31			-248.4	%		(45	)		1,181			-103.8	%
Total noninterest income		25,948			24,432			6.2	%		71,667			63,763			12.4	%
Salaries and benefits		30,429			27,878			9.2	%		89,756			75,781			18.4	%
Occupancy expenses		9,395			8,006			17.3	%		26,540			21,391			24.1	%
Other expenses		13,938			15,474			-9.9	%		40,516			34,861			16.2	%
Total noninterest expenses		53,762			51,358			4.7	%		156,812			132,033			18.8	%
Income before income taxes		27,162			19,839			36.9	%		73,217			64,752			13.1	%
Provision for income taxes		7,496			6,459			16.1	%		22,043			20,335			8.4	%
Net income	$	19,666		$	13,380			47.0	%	$	51,174		$	44,417			15.2	%
Basic earnings per common share	$	0.28		$	0.20			45.2	%	$	0.74		$	0.65			13.8	%
Diluted earnings per common share	$	0.28		$	0.19			45.3	%	$	0.73		$	0.64			13.6	%
Dividends per common share	$	0.03		$	—			100.0	%	$	0.09		$	—			100.0	%
Period end # of shares outstanding		69,154			68,362			1.2	%		69,154			68,362			1.2	%
Weighted avg # of shares outstanding (incl CSE’s)		70,830			70,008			1.2	%		70,544			69,566			1.4	%

	3Q-04			3Q-03			% change			YTD 04			YTD 03			% change
	($ in 000’s except per share data)
Nonperforming assets
Nonaccrual loans	$	11,370		$	14,173			-19.8	%
Accruing loans 90 or more days past due		788			983			-19.8	%
Restructured loans		—			—			0.0	%
ORE and OLRA		8,076			3,688			119.0	%
Total nonperforming assets	$	20,234		$	18,844			7.4	%
Changes in allowance for loan losses
Allowance for loan losses — beginning of period	$	47,492		$	38,723			22.6	%	$	43,008		$	36,696			17.2	%
Provision for loan losses		3,000			3,000			0.0	%		8,000			9,000			-11.1	%
Charge-offs		(1,666	)		(2,157	)		-22.8	%		(6,796	)		(6,530	)		4.1	%
Recoveries		377			143			163.8	%		2,875			543			429.4	%
Allowance acquired through mergers and acquisitions		—			1,426			-100.0	%		2,116			1,426			48.4	%
Allowance for loan losses — end of period	$	49,203		$	41,135			19.6	%	$	49,203		$	41,135			19.6	%
Ratios
Return on average assets		1.21	%		0.95	%					1.10	%		1.13	%
Return on average common shareholders’ equity		14.79	%		11.14	%					13.19	%		12.72	%
Tier 1 leverage ratio		8.90	%		8.06	%
Taxable-equivalent yield on interest-earning assets		5.03	%		4.84	%					4.96	%		5.09	%
Cost of funds with demand accounts		0.98	%		0.87	%					0.86	%		0.99	%
Taxable-equivalent net interest margin		4.04	%		3.97	%					4.08	%		4.10	%
Efficiency ratio		63.07	%		69.25	%					64.73	%		64.53	%
Demand deposits to total deposits		33.36	%		30.97	%					33.42	%		30.55	%
Noninterest income to total income		30.92	%		32.93	%					30.11	%		30.99	%
Noninterest expense to average interest-earning assets		3.65	%		4.01	%					3.75	%		3.74	%
Nonperforming assets to loans and other real estate		0.49	%		0.57	%
Net charge-offs to average loans		0.13	%		0.24	%					0.14	%		0.25	%
Allowance for loan losses to total loans		1.19	%		1.24	%
Allowance for loan losses to nonperforming loans		404.70	%		271.41	%
Common stock performance
Market value of common stock — Close	$	20.140		$	36.490					$	20.140		$	36.490
Market value of common stock — High	$	22.055		$	38.450					$	22.085		$	38.450
Market value of common stock — Low	$	19.500		$	32.050					$	18.425		$	27.590
Book value of common stock	$	7.95		$	14.07
Market/book value of common stock		253	%		259	%
Price/12 month trailing earnings ratio		21			21
Other data
EOP Employees — full time equivalent		1,832			1,728			6.0	%
Period end balances				($ in 000's )
Loans held for investment	$	4,134,125		$	3,328,827			24.2	%
Loans held for sale		96,022			100,366			-4.3	%
Investment securities		1,702,393			1,507,504			12.9	%
Securities purchased under resale agreements		—			30,000			-100.0	%
Fed funds sold and other interest-earning assets		75,848			88,592			-14.4	%
Total interest-earning assets		6,008,388			5,055,289			18.9	%
Allowance for loan losses		(49,203	)		(41,135	)		19.6	%
Cash and due from banks		246,002			286,417			-14.1	%
Goodwill		54,998			25,647			114.4	%
Core deposit intangibles		9,855			6,858			43.7	%
Other assets		363,330			330,434			10.0	%
Total assets	$	6,633,370		$	5,663,510			17.1	%
Noninterest-bearing demand deposits	$	1,593,652		$	1,341,27			7 18.8	%
Interest-bearing demand deposits		69,531			40,496			71.7	%
Savings deposits		2,010,178			1,875,66			5 7.2	%
Time deposits		1,131,101			1,051,81			5 7.5	%
Total deposits		4,804,462			4,309,25			3 11.5	%
Repurchase agreements and other borrowed funds		1,253,242			842,644			48.7	%
Other liabilities		25,881			30,709			-15.7	%
Shareholders’ equity		549,785			480,904			14.3	%
Total liabilities and shareholders’ equity	$	6,633,370		$	5,663,51			0 17.1	%

EXHIBIT I

Rate Volume
3 Months Ended Analysis
(unaudited)

	Three Months Ended								Three Months Ended
	September 30, 2004								September 30, 2003
	Average			Interest		Average			Average			Interest		Average
	Outstanding			Earned/		Yield/			Outstanding			Earned/		Yield/
	Balance			Paid(1)		Rate			Balance			Paid(1)		Rate
	(Dollars in thousands)
Interest-earning assets:
Loans	$	4,123,462		$	56,463		5.45	%	$	3,456,711		$	48,526		5.57	%
Securities		1,691,472			17,477		4.11			1,497,754			13,130		3.48
Federal funds sold and other		52,573			192		1.45			120,474			303		1.00
Total interest-earning assets		5,867,507			74,132		5.03	%		5,074,939			61,959		4.84	%
Less allowance for loan losses		(49,422	)							(41,469	)
		5,818,085								5,033,470
Noninterest-earning assets		672,530								576,097
Total assets	$	6,490,615							$	5,609,567
Interest-bearing liabilities:
Money market and savings deposits	$	2,084,393			4,445		0.85	%	$	1,927,282			3,685		0.76	%
Time deposits		1,088,302			5,583		2.04			1,064,502			5,421		2.02
Repurchase agreements and other borrowed funds		1,173,762			4,590		1.56			771,132			2,105		1.08
Total interest-bearing liabilities		4,346,457			14,618		1.34	%		3,762,916			11,211		1.18	%
Noninterest-bearing liabilities:
Noninterest-bearing demand deposits		1,587,990								1,342,560
Other liabilities		27,246								27,493
Total liabilities		5,961,693								5,132,969
Shareholders’ equity		528,922								476,598
Total liabilities and shareholders’ equity	$	6,490,615							$	5,609,567
Taxable-equivalent net interest income				$	59,514							$	50,748
Net interest spread							3.69	%							3.66	%
Taxable-equivalent net interest margin							4.04	%							3.97	%

(1) Taxable-equivalent rates used where applicable.

	Three Months Ended
	Q3 2004 vs Q3 2003
	Increase (Decrease)
				Due to
	Volume			Rate			Total
	(Dollars in thousands)
Interest-earning assets:
Loans		9,218			(1,281	)	$	7,937
Securities		1,679			2,668			4,347
Federal funds sold and other		(169	)		58			(111	)
Total increase in interest income		10,728			1,445			12,173
Interest-bearing liabilities:
Money market and savings deposits		296			464			760
Time deposits		111			51			162
Repurchase agreements and borrowed funds		1,093			1,392			2,485
Total increase in interest expense		1,500			1,907			3,407
Increase (decrease) in net interest income	$	9,228		$	(462	)	$	8,766

EXHIBIT II

Rate Volume
Linked Quarter Analysis
(unaudited)

	Three Months Ended								Three Months Ended
	September 30, 2004								June 30, 2004
	Average			Interest		Average			Average			Interest		Average
	Outstanding			Earned/		Yield/			Outstanding			Earned/		Yield/
	Balance			Paid(1)		Rate			Balance			Paid(1)		Rate
	(Dollars in thousands)
Interest-earning assets:
Loans	$	4,123,462		$	56,463		5.45	%	$	3,873,174		$	51,478		5.35	%
Securities		1,691,472			17,477		4.11			1,628,789			15,890		3.92
Federal funds sold and other		52,573			192		1.45			42,375			119		1.13
Total interest-earning assets		5,867,507			74,132		5.03	%		5,544,338			67,487		4.90	%
Less allowance for loan losses		(49,422	)							(49,658	)
		5,818,085								5,494,680
Noninterest-earning assets		672,530								686,900
Total assets	$	6,490,615							$	6,181,580
Interest-bearing liabilities:
Money market and savings deposits	$	2,084,393			4,445		0.85	%	$	2,052,257			3,353		0.66	%
Time deposits		1,088,302			5,583		2.04			1,065,937			5,055		1.91
Repurchase agreements and other borrowed funds		1,173,762			4,590		1.56			940,165			2,660		1.14
Total interest-bearing liabilities		4,346,457			14,618		1.34	%		4,058,359			11,068		1.10	%
Noninterest-bearing liabilities:
Noninterest-bearing demand deposits		1,587,990								1,574,075
Other liabilities		27,246								33,824
Total liabilities		5,961,693								5,666,258
Shareholders’ equity		528,922								515,322
Total liabilities and shareholders’ equity	$	6,490,615							$	6,181,580
Taxable-equivalent net interest income				$	59,514							$	56,419
Net interest spread							3.69	%							3.80	%
Taxable-equivalent net interest margin							4.04	%							4.09	%

(1) Taxable-equivalent rates used where applicable.

	Three Months Ended
	Q3 2004 vs Q2 2004
	Increase (Decrease)
	Due to
	Volume		Rate			Days		Total
			(Dollars in thousands)
Interest-earning assets:
Loans		3,363		1,056			566	$	4,985
Securities		618		794			175		1,587
Federal funds sold and other		29		43			1		73
Total increase in interest income		4,010		1,893			742		6,645
Interest-bearing liabilities:
Money market and savings deposits		53		1,002			37		1,092
Time deposits		107		365			56		528
Repurchase agreements and borrowed funds		668		1,233			29		1,930
Total increase in interest expense		828		2,600			122		3,550
Increase (decrease) in net interest income	$	3,182	$	(707	)	$	620	$	3,095

Southwest Bancorporation of Texas, Inc.
Consolidated Financial Information (unaudited)
Quarterly Trend Analysis
	3Q-02			4Q-02			1Q-03			2Q-03			3Q-03			4Q-03			1Q-04			2Q-04			3Q-04
Balance sheet averages
Loans held for investment	$	2,855,389		$	3,034,633		$	3,128,640		$	3,218,818		$	3,351,647		$	3,362,374		$	3,601,637		$	3,768,629		$	4,027,343
Loans held for sale		72,922			85,766			93,726			86,001			105,064			98,777			95,617			104,545			96,119
Investment securities		1,192,252			1,198,055			1,157,825			1,222,798			1,497,754			1,539,469			1,555,791			1,628,789			1,691,472
Securities purchased under resale agreements		19,999			20,000			18,000			30,000			30,000			30,000			23,077			—			2,435
Fed funds sold and other interest-earning assets		26,250			41,967			53,316			66,204			90,474			39,997			51,512			42,375			50,138
Total interest-earning assets		4,166,812			4,380,421			4,451,507			4,623,821			5,074,939			5,070,617			5,327,634			5,544,338			5,867,507
Allowance for loan losses		(34,474	)		(36,105	)		(38,216	)		(39,930	)		(41,469	)		(42,513	)		(45,770	)		(49,658	)		(49,422	)
Cash and due from banks		191,469			226,675			299,117			233,126			257,010			268,099			323,517			266,082			251,686
Goodwill		2,590			2,590			2,590			2,590			25,471			25,647			45,689			55,077			54,998
Core deposit intangibles		—			—			—			—			6,327			6,509			7,934			11,149			10,240
Other assets		280,699			283,477			289,330			290,585			287,289			338,571			354,793			354,592			355,606
Total assets	$	4,607,096		$	4,857,058		$	5,004,328		$	5,110,192		$	5,609,567		$	5,666,930		$	6,013,797		$	6,181,580		$	6,490,615
Noninterest-bearing deposits	$	1,016,011		$	1,099,772		$	1,172,389		$	1,208,477		$	1,342,560		$	1,399,592		$	1,491,064		$	1,574,075		$	1,587,990
Interest-bearing demand deposits		32,006			38,572			35,047			35,451			73,142			37,997			60,359			71,089			71,430
Savings deposits		1,529,241			1,630,166			1,698,516			1,775,535			1,854,140			1,829,947			1,912,839			1,981,168			2,012,963
Time deposits		964,091			892,342			965,267			964,980			1,064,502			1,023,668			1,005,189			1,065,937			1,088,302
Total deposits		3,541,349			3,660,852			3,871,219			3,984,443			4,334,344			4,291,204			4,469,451			4,692,269			4,760,685
Repurchase agreements and other borrowed funds		613,791			730,363			639,359			627,729			771,132			847,109			1,008,229			940,165			1,173,762
Other liabilities		25,266			25,695			40,323			27,349			27,493			40,991			25,425			33,824			27,246
Minority interest		1,472			506			—			—			—			—			—			—			—
Shareholders’ equity		425,218			439,642			453,427			470,671			476,598			487,626			510,692			515,322			528,922
Total liabilities and equity	$	4,607,096		$	4,857,058		$	5,004,328		$	5,110,192		$	5,609,567		$	5,666,930		$	6,013,797		$	6,181,580		$	6,490,615
Income statement data
Interest and fees on loans	$	45,774		$	46,735		$	45,156		$	46,988		$	48,359		$	48,022		$	49,632		$	51,289		$	56,259
Interest on securities		15,266			12,685			11,951			11,489			12,314			13,856			14,549			14,678			16,143
Interest on fed funds sold and other interest-earning assets		191			230			206			284			303			175			189			119			192
Total interest income		61,231			59,650			57,313			58,761			60,976			62,053			64,370			66,086			72,594
Interest on deposits		12,819			11,276			10,106			9,535			9,106			8,224			8,070			8,408			10,028
Interest on borrowings		2,671			2,846			2,126			2,050			2,105			2,473			2,932			2,660			4,590
Total interest expense		15,490			14,122			12,232			11,585			11,211			10,697			11,002			11,068			14,618
Net interest income		45,741			45,528			45,081			47,176			49,765			51,356			53,368			55,018			57,976
Provision for loan losses		3,000			3,000			3,000			3,000			3,000			3,000			2,000			3,000			3,000
Net interest income after provision		42,741			42,528			42,081			44,176			46,765			48,356			51,368			52,018			54,976
Service charges on deposit accounts		8,367			8,896			9,617			9,316			10,551			10,581			11,040			11,190			11,184
Investment services		2,371			2,119			2,295			2,430			2,489			2,498			2,970			2,885			3,164
Other fee income		957			4,173			3,648			3,959			6,816			4,986			4,953			5,399			6,214
Other operating income		3,145			4,758			3,658			3,259			4,545			5,048			3,391			3,890			5,432
Gain (loss) on sales of securities		1,680			55			35			1,115			31			43			26			(25	)		(46	)
Total noninterest income		16,520			20,001			19,253			20,079			24,432			23,156			22,380			23,339			25,948
Salaries and benefits		22,325			22,777			23,826			24,076			27,878			27,966			29,243			30,084			30,429
Occupancy expenses		5,840			7,110			6,500			6,885			8,006			8,299			8,258			8,887			9,395
Other expenses		9,949			9,611			9,185			10,202			15,474			11,865			13,771			12,807			13,938
Minority interest		30			(39	)		—			—			—			—			—			—			—
Total noninterest expenses		38,144			39,459			39,511			41,163			51,358			48,130			51,272			51,778			53,762
Income before income taxes		21,117			23,070			21,823			23,092			19,839			23,382			22,476			23,579			27,162
Provision for income taxes		6,555			7,153			6,748			7,129			6,459			7,071			7,189			7,358			7,496
Net income	$	14,562		$	15,917		$	15,075		$	15,963		$	13,380		$	16,311		$	15,287		$	16,221		$	19,666
Basic earnings per common share	$	0.22		$	0.24		$	0.22		$	0.24		$	0.20		$	0.24		$	0.22		$	0.24		$	0.28
Diluted earnings per common share	$	0.21		$	0.23		$	0.22		$	0.23		$	0.19		$	0.23		$	0.22		$	0.23		$	0.28
Dividends per common share	$	—		$	—		$	—		$	—		$	0.03		$	0.03		$	0.03		$	0.03		$	0.03
Period end # of shares outstanding		67,668			67,712			67,786			68,114			68,362			68,428			68,612			69,068			69,154
Weighted avg # of shares outstanding (incl CSE’s)		69,452			69,133			69,280			69,456			70,008			70,190			70,282			70,528			70,830

EXHIBIT III

Southwest Bancorporation of Texas, Inc.
Consolidated Financial Information (unaudited)
Quarterly Trend Analysis
	3Q-02			4Q-02			1Q-03			2Q-03			3Q-03			4Q-03			1Q-04			2Q-04			3Q-04
Nonperforming assets
Nonaccrual loans	$	14,596		$	13,113		$	20,503		$	14,609		$	14,173		$	11,443		$	17,671		$	10,668		$	11,370
Accruing loans 90 or more days past due		2,687			1,876			1,893			4,308			983			1,299			3,044			1,805			788
Restructured loans		—			—			—			—			—			—			—						—
ORE and OLRA		829			760			684			3,398			3,688			4,248			4,722			11,461			8,076
Total nonperforming assets	$	18,112		$	15,749		$	23,080		$	22,315		$	18,844		$	16,990		$	25,437		$	23,934		$	20,234
Changes in allowance for loan losses
Allowance for loan losses — beginning of period	$	33,025		$	34,597		$	36,696		$	38,508		$	38,723		$	41,135		$	43,008		$	48,071		$	47,492
Provision for loan losses		3,000			3,000			3,000			3,000			3,000			3,000			2,000			3,000			3,000
Charge-offs		(1,580	)		(1,045	)		(1,319	)		(3,054	)		(2,157	)		(1,725	)		(1,382	)		(3,748	)		(1,666	)
Recoveries		152			232			131			269			143			598			2,329			169			377
Allowance acquired through mergers and acquisitions		—			—			—			—			1,426			—			2,116			—			—
Adjustment for sale of subsidiary		—			(88	)		—			—			—			—			—			—			—
Allowance for loan losses — end of period	$	34,597		$	36,696		$	38,508		$	38,723		$	41,135		$	43,008		$	48,071		$	47,492		$	49,203
Ratios
Return on average assets		1.25	%		1.30	%		1.22	%		1.25	%		0.95	%		1.14	%		1.02	%		1.06	%		1.21	%
Return on average common shareholders’ equity		13.59	%		14.36	%		13.48	%		13.60	%		11.14	%		13.27	%		12.04	%		12.66	%		14.79	%
Tier 1 leverage ratio		8.97	%		8.85	%		8.91	%		9.06	%		8.06	%		9.15	%		8.35	%		8.45	%		8.90	%
Taxable-equivalent yield on interest-earning assets		5.90	%		5.47	%		5.30	%		5.17	%		4.84	%		4.93	%		4.94	%		4.90	%		5.03	%
Cost of funds with demand accounts		1.48	%		1.28	%		1.10	%		1.01	%		0.87	%		0.83	%		0.81	%		0.79	%		0.98	%
Taxable-equivalent net interest margin		4.43	%		4.19	%		4.19	%		4.17	%		3.97	%		4.09	%		4.11	%		4.09	%		4.04	%
Efficiency ratio		62.96	%		60.27	%		61.45	%		62.24	%		68.31	%		63.73	%		66.55	%		64.82	%		63.07	%
Demand deposits to total deposits		28.69	%		30.04	%		30.28	%		30.33	%		30.97	%		32.62	%		33.36	%		33.55	%		33.36	%
Noninterest income to total income		26.53	%		30.52	%		29.93	%		29.86	%		32.93	%		31.08	%		29.61	%		29.88	%		30.92	%
Noninterest expense to average interest-earning assets		3.63	%		3.57	%		3.60	%		3.57	%		4.01	%		3.77	%		3.88	%		3.76	%		3.65	%
Nonperforming assets to loans and other real estate		0.62	%		0.50	%		0.73	%		0.68	%		0.57	%		0.49	%		0.68	%		0.61	%		0.49	%
Net charge-offs (recoveries) to average loans		0.20	%		0.11	%		0.15	%		0.35	%		0.24	%		0.13	%		(0.11	)%		0.38	%		0.13	%
Allowance for loan losses to total loans		1.18	%		1.18	%		1.21	%		1.18	%		1.24	%		1.23	%		1.29	%		1.21	%		1.19	%
Allowance for loan losses to nonperforming loans		200.18	%		244.82	%		171.94	%		204.70	%		271.41	%		337.53	%		232.06	%		380.76	%		404.70	%
Common stock performance
Market value of stock — Close	$	18.205		$	14.405		$	15.015		$	16.255		$	18.245		$	19.425		$	18.865		$	22.060		$	20.140
Market value of stock — High	$	19.600		$	18.670		$	16.525		$	17.975		$	19.225		$	19.645		$	19.955		$	22.085		$	22.055
Market value of stock — Low	$	15.225		$	12.245		$	13.795		$	14.825		$	16.025		$	17.600		$	18.425		$	18.605		$	19.500
Book value of stock	$	6.42		$	6.58		$	6.80		$	7.05		$	7.03		$	7.29		$	7.63		$	7.39		$	7.95
Market/book value of stock		283	%		219	%		221	%		231	%		259	%		266	%		247	%		299	%		253	%
Price/earnings ratio		22			17			17			18			21			22			22			25			21
Other data
EOP Employees — full time equivalent		1,434			1,481			1,528			1,556			1,728			1,760			1,839			1,830			1,832
Period end balances
Loans held for investment	$	2,928,547		$	3,117,951		$	3,181,059		$	3,277,684		$	3,328,827		$	3,491,673		$	3,720,950		$	3,912,212		$	4,134,125
Loans held for sale		81,874			101,389			87,398			91,757			100,366			96,899			101,944			97,929			96,022
Investment securities		1,254,849			1,201,200			1,193,917			1,303,613			1,507,504			1,549,398			1,576,977			1,624,540			1,702,393
Securities purchased under resale agreements		20,000			20,000			30,000			30,000			30,000			30,000			—			—			—
Fed funds sold and other interest-earning assets		130,124			43,107			92,364			244,117			88,592			64,908			52,678			45,612			75,848
Total interest-earning assets		4,415,394			4,483,647			4,584,738			4,947,171			5,055,289			5,232,878			5,452,549			5,680,293			6,008,388
Allowance for loan losses		(34,597	)		(36,696	)		(38,508	)		(38,723	)		(41,135	)		(43,008	)		(48,071	)		(47,492	)		(49,203	)
Cash and due from banks		197,489			472,257			289,363			270,711			286,417			390,890			290,796			270,551			246,002
Goodwill		2,590			2,590			2,590			2,590			25,647			25,647			55,094			54,998			54,998
Core deposit intangibles		—			—			—			—			6,858			6,185			11,661			10,653			9,855
Other assets		257,581			250,159			271,686			260,383			330,434			333,144			352,189			390,958			363,330
Total assets	$	4,838,457		$	5,171,957		$	5,109,869		$	5,442,132		$	5,663,510		$	5,945,736		$	6,114,218		$	6,359,961		$	6,633,370
Noninterest-bearing demand deposits	$	1,115,405		$	1,290,323		$	1,270,991		$	1,343,749		$	1,341,277		$	1,513,038		$	1,625,647		$	1,622,348		$	1,593,652
Interest-bearing demand deposits		35,000			36,222			39,551			31,479			40,496			43,452			72,009			62,316			69,531
Savings deposits		1,521,060			1,715,536			1,723,369			1,766,818			1,875,665			1,840,814			1,985,622			1,998,375			2,010,178
Time deposits		903,874			869,968			978,350			997,407			1,051,815			1,005,935			1,019,666			1,097,130			1,131,101
Total deposits		3,575,339			3,912,049			4,012,261			4,139,453			4,309,253			4,403,239			4,702,944			4,780,169			4,804,462
Repurchase agreements and other borrowed funds		804,294			790,873			602,465			789,993			842,644			1,016,930			854,005			1,031,866			1,253,242
Other liabilities		22,755			23,512			34,152			32,770			30,709			26,246			34,038			37,746			25,881
Minority interest		1,503			—			—			—			—			—			—			—			—
Shareholders’ equity		434,566			445,523			460,991			479,916			480,904			499,321			523,231			510,180			549,785
Total liabilities and equity	$	4,838,457		$	5,171,957		$	5,109,869		$	5,442,132		$	5,663,510		$	5,945,736		$	6,114,218		$	6,359,961		$	6,633,370

EXHIBIT IV

Southwest Bancorporation of Texas, Inc.
Reconcilements of Non-GAAP Disclosures for Impact of Recovery
of Valuation Allowance on Mortgage Servicing Rights, Net,
Merger-Related Expenses and Core Deposit Intangible
Amortization Expense
	3Q-04			3Q-03			% change			YTD 04			YTD 03			% change
				(in 000's except per share data)
Noninterest income — as reported	$	25,948		$	24,432			6.2	%	$	71,667		$	63,763			12.4	%
Impact of recovery of valuation allowance on mortgage servicing rights, net		—			(2,605	)					—			(2,371	)
Noninterest income — adjusted for recovery of valuation allowance on mortgage servicing rights, net	$	25,948		$	21,827			18.9	%	$	71,667		$	61,392			16.7	%
Total revenue — as reported	$	83,924		$	74,197			13.1	%	$	238,029		$	205,785			15.7	%
Impact of recovery of valuation allowance on mortgage servicing rights, net		—			(2,605	)					—			(2,371	)
Total revenue — adjusted for recovery of valuation allowance on mortgage servicing rights, net	$	83,924		$	71,592			17.2	%	$	238,029		$	203,414			17.0	%
Net income — as reported	$	19,666		$	13,380			47.0	%	$	51,174		$	44,417			15.2	%
Impact of core deposit intangible amortization expense, after tax		519			452						1,762			452
Net income — adjusted for core deposit intangible amortization expense	$	20,185		$	13,832			45.9	%	$	52,936		$	44,869			18.0	%
Diluted earnings per common share — as reported	$	0.28		$	0.19			45.3	%	$	0.73		$	0.64			13.6	%
Impact of core deposit intangible amortization expense, after tax		0.01			0.01						0.02			0.01
Diluted cash earnings per common share	$	0.29		$	0.20			43.0	%	$	0.75		$	0.65			14.9	%
Noninterest expenses — as reported	$	53,762		$	51,358			4.7	%	$	156,812		$	132,033			18.8	%
Impact of merger-related expenses		(138	)		(3,000	)					(1,342	)		(3,000	)
Impact of core deposit intangible amortization expense		(799	)		(695	)					(2,710	)		(695	)
Noninterest expenses — adjusted for merger-related expenses and core deposit intangible amortization expense	$	52,825		$	47,663			10.8	%	$	152,760		$	128,338			19.0	%

	3Q-04		2Q-04		% change
Net income — as reported	$	19,666	$	16,221		21.2	%
Impact of core deposit intangible amortization expense, after tax		519		655
Net income — adjusted for core deposit intangible amortization expense, after tax	$	20,185	$	16,876		19.6	%
Diluted earnings per common share — as reported	$	0.28	$	0.23		20.7	%
Impact of core deposit intangible amortization expense, after tax		0.01		0.01
Diluted cash earnings per common share	$	0.29	$	0.24		19.9	%