Hilltop 8K Announces Financial Results for Fourth Quarter and Full Year 2023 | HTH 25 Jan 24

Exhibit 99.1

	Investor Relations Contact:
	Erik Yohe
	214-525-4634
	eyohe@hilltop-holdings.com

Hilltop Holdings Inc. Announces Financial Results for Fourth Quarter and Full Year 2023

DALLAS — (BUSINESS WIRE) January 25, 2024 — Hilltop Holdings Inc. (NYSE: HTH) (“Hilltop”) today announced financial results for the fourth quarter and full year 2023. Hilltop produced income to common stockholders of $28.7 million, or $0.44 per diluted share, for the fourth quarter of 2023, compared to $25.6 million, or $0.39 per diluted share, for the fourth quarter of 2022. Income to common stockholders for the full year 2023 was $109.6 million, or $1.69 per diluted share, compared to $113.1 million, or $1.60 per diluted share, for the full year 2022. Hilltop’s financial results for the fourth quarter and full year 2023 included decreases in year-over-year mortgage origination segment net gains from sales of loans and other mortgage production income, a decline in the net interest income within the banking segment, and increases in net revenues within certain of the broker-dealer segment’s business lines.

Hilltop also announced that its Board of Directors declared a quarterly cash dividend of $0.17 per common share, a 6% increase from the prior quarter, payable on February 28, 2024, to all common stockholders of record as of the close of business on February 12, 2024. Additionally, the Hilltop Board of Directors authorized, subject to regulatory approvals or non-objections, a new stock repurchase program through January 2025, under which Hilltop may repurchase, in the aggregate, up to $75.0 million of its outstanding common stock. During 2023, Hilltop paid $5.1 million to repurchase an aggregate of 164,604 shares of its common stock at an average price of $30.95 per share pursuant to the 2023 stock repurchase program, which is inclusive of repurchases during the fourth quarter of 2023. These shares were returned to the pool of authorized but unissued shares of common stock.

Headwinds that began in 2022, and continued through 2023, including the impact of tight housing inventories on mortgage volumes, declining deposit balances, rapid increases in market interest rates and a volatile economic forecast have had an adverse impact on our operating results during 2023. The impacts of such headwinds during 2024 remain uncertain and will depend on developments outside of our control, including, among others, the timing and significance of further changes in U.S. treasury yields and mortgage interest rates, exposure to increasing funding costs, inflationary pressures associated with compensation, occupancy and software costs and labor market conditions, and international armed conflicts and their impact on supply chains.

Jeremy B. Ford, President and CEO of Hilltop, said, “2023 presented a challenging operating environment for Hilltop. Despite the turmoil created by bank failures in the first quarter of 2023, the prudent management of operations at our lines of business and sound stewardship of our balance sheet allowed us to continue to support our clients with exceptional service and end a volatile year with strong capital and liquidity.

“At PlainsCapital Bank, we delivered profitable results in the face of steep competition for deposits and muted loan demand from borrowers. PrimeLending continued to experience a difficult mortgage market as tight inventories and elevated mortgage rates challenged affordability for consumers and production volume. HilltopSecurities offset down markets for our Public Finance and Fixed Income business lines by generating exceptional results from our Structured Finance and Wealth Management platforms. The results at the broker-dealer reflect the value in our diversified offerings at HilltopSecurities.

“As we move into 2024, we will continue to proactively manage costs in this tight operating environment and focus on our conservative, long-term strategy to further build on Hilltop’s franchise value.”

Fourth Quarter 2023 Highlights for Hilltop:

●

The provision for credit losses was $1.3 million during the fourth quarter of 2023, compared to a reversal of credit losses of $40 thousand in the third quarter of 2023 and a provision for credit losses of $3.6 million in the fourth quarter of 2022;

The provision for credit losses during the fourth quarter of 2023 reflected a slight build in the allowance related to increases in specific reserves and net portfolio changes, partially offset by improvements to the U.S. economic outlook since the prior quarter within the banking segment.

●

For the fourth quarter of 2023, net gains from sale of loans and other mortgage production income and mortgage loan origination fees within our mortgage origination segment was $69.2 million, compared to $71.1 million in the fourth quarter of 2022, a 2.7% decrease;

Mortgage loan origination production volume was $1.8 billion during the fourth quarter of 2023, compared to $2.0 billion in the fourth quarter of 2022;

Net gains from mortgage loans sold to third parties decreased to 189 basis points during the fourth quarter of 2023, compared to 199 basis points in the third quarter of 2023.

●

Hilltop’s consolidated annualized return on average assets and return on average stockholders’ equity for the fourth quarter of 2023 were 0.75% and 5.46%, respectively, compared to 0.63% and 4.99%, respectively, for the fourth quarter of 2022;

●

Hilltop’s book value per common share increased to $32.58 at December 31, 2023, compared to $31.91 at September 30, 2023;

●

Hilltop’s total assets were $16.5 billion and $16.4 billion at December 31, 2023 and September 30, 2023, respectively;

●

Loans¹, net of allowance for credit losses, were $7.6 billion and $7.7 billion at December 31, 2023 and September 30, 2023, respectively;

●

Non-performing loans were $68.3 million, or 0.76% of total loans, at December 31, 2023, compared to $31.5 million, or 0.34% of total loans, at September 30, 2023;

Non-performing loans during the fourth quarter of 2023 increased from the prior period primarily due to the addition of a single non-owner occupied commercial real estate credit relationship within our hotel/motel portfolio industry subsector of $33.3 million.

●

Loans held for sale decreased by 10.9% from September 30, 2023 to $0.9 billion at December 31, 2023;

●

Total deposits were $11.1 billion at each of December 31, 2023 and September 30, 2023;

Total estimated uninsured deposits were $4.7 billion, or approximately 42% of total deposits, while estimated uninsured deposits, excluding collateralized deposits of $315.7 million, were $4.4 billion, or approximately 40% of total deposits, at December 31, 2023.

●

Hilltop maintained strong capital levels² with a Tier 1 Leverage Ratio³ of 12.23% and a Common Equity Tier 1 Capital Ratio of 19.31% at December 31, 2023;

●

Hilltop’s consolidated net interest margin⁴decreased to 2.96% for the fourth quarter of 2023, compared to 3.02% in the third quarter of 2023;

●

For the fourth quarter of 2023, noninterest income was $179.0 million, compared to $169.8 million in the fourth quarter of 2022, a 5.4% increase;

●

For the fourth quarter 2023, noninterest expense was $250.8 million, compared to $253.4 million in the fourth quarter of 2022, a 1.0% decrease; and

●

Hilltop’s effective tax rate was 18.7% during the fourth quarter of 2023, compared to 26.6% during the same period in 2022.

The effective tax rate for the fourth quarter of 2023 was lower than the applicable statutory rate primarily due to investments in tax-exempt instruments and changes in accumulated tax reserves, partially offset by the impact of nondeductible expenses, non-deductible compensation expense and other permanent adjustments.

¹ “Loans” reflect loans held for investment excluding broker-dealer margin loans, net of allowance for credit losses, of $344.1 million and $357.1 million at December 31, 2023 and September 30, 2023, respectively.

² Capital ratios reflect Hilltop’s decision to elect the transition option as issued by the federal banking regulatory agencies in March 2020 that permits banking institutions to mitigate the estimated cumulative regulatory capital effects from CECL over a five-year transitionary period through December 31, 2024.

³ Based on the end of period Tier 1 capital divided by total average assets during the quarter, excluding goodwill and intangible assets.

⁴ Net interest margin is defined as net interest income divided by average interest-earning assets.

Consolidated Financial and Other Information


Consolidated Balance Sheets	December 31,		September 30,		June 30,		March 31,		December 31,
(in 000's)	2023		2023		2023		2023		2022
Cash and due from banks	$	1,858,700	$	1,513,747	$	1,584,709	$	1,764,081	$	1,579,512
Federal funds sold		650		3,650		650		743		650
Assets segregated for regulatory purposes		57,395		47,491		50,711		36,199		67,737
Securities purchased under agreements to resell		80,011		123,719		143,982		144,201		118,070
Securities:
Trading, at fair value		515,991		578,901		696,649		692,908		755,032
Available for sale, at fair value, net ⁽¹⁾		1,507,595		1,456,238		1,526,869		1,641,571		1,658,766
Held to maturity, at amortized cost, net ⁽¹⁾		812,677		825,079		847,437		862,280		875,532
Equity, at fair value		321		264		258		231		200
		2,836,584		2,860,482		3,071,213		3,196,990		3,289,530
Loans held for sale		943,846		1,058,806		1,333,044		1,040,138		982,616
Loans held for investment, net of unearned income		8,079,745		8,204,052		8,354,122		8,192,846		8,092,673
Allowance for credit losses		(111,413)		(110,822)		(109,306)		(97,354)		(95,442)
Loans held for investment, net		7,968,332		8,093,230		8,244,816		8,095,492		7,997,231

Broker-dealer and clearing organization receivables		1,573,931		1,460,352		1,474,177		1,560,246		1,038,055
Premises and equipment, net		168,856		172,097		176,574		180,132		184,950
Operating lease right-of-use assets		88,580		93,057		97,979		100,122		102,443
Mortgage servicing assets		96,662		104,951		95,101		103,314		100,825
Other assets		517,545		588,751		588,166		529,438		518,899
Goodwill		267,447		267,447		267,447		267,447		267,447
Other intangible assets, net		8,457		9,078		9,772		10,544		11,317
Total assets	$	16,466,996	$	16,396,858	$	17,138,341	$	17,029,087	$	16,259,282

Deposits:
Noninterest-bearing	$	3,007,101	$	3,200,247	$	3,451,438	$	3,807,878	$	3,968,862
Interest-bearing		8,056,091		7,902,850		7,712,739		7,289,269		7,346,887
Total deposits		11,063,192		11,103,097		11,164,177		11,097,147		11,315,749
Broker-dealer and clearing organization payables		1,430,734		1,368,064		1,306,646		1,383,317		966,470
Short-term borrowings		900,038		882,999		1,628,637		1,572,794		970,056
Securities sold, not yet purchased, at fair value		34,872		51,527		74,761		51,497		53,023
Notes payable		347,145		347,020		364,531		376,410		346,654
Operating lease liabilities		109,002		114,334		119,999		122,878		126,759
Other liabilities		431,684		422,955		389,336		341,246		417,042
Total liabilities		14,316,667		14,289,996		15,048,087		14,945,289		14,195,753

Common stock		652		652		651		650		647
Additional paid-in capital		1,054,662		1,052,867		1,050,191		1,044,774		1,046,331
Accumulated other comprehensive loss		(121,505)		(145,083)		(131,718)		(125,461)		(133,531)
Retained earnings		1,189,222		1,171,250		1,144,624		1,136,901		1,123,636
Deferred compensation employee stock trust, net		228		340		450		446		481
Employee stock trust		(292)		(446)		(599)		(599)		(640)
Total Hilltop stockholders' equity		2,122,967		2,079,580		2,063,599		2,056,711		2,036,924
Noncontrolling interests		27,362		27,282		26,655		27,087		26,605
Total stockholders' equity		2,150,329		2,106,862		2,090,254		2,083,798		2,063,529
Total liabilities & stockholders' equity	$	16,466,996	$	16,396,858	$	17,138,341	$	17,029,087	$	16,259,282

(1)

At December 31, 2023, the amortized cost of the available for sale securities portfolio was $1,621,747, while the fair value of the held to maturity securities portfolio was $731,858.


	Three Months Ended						Year Ended
Consolidated Income Statements	December 31,		September 30,		December 31,		December 31,		December 31,
(in 000's, except per share data)	2023		2023		2022		2023		2022
Interest income:
Loans, including fees	$	138,096	$	142,402	$	117,906	$	542,274	$	416,207
Securities borrowed		18,659		17,683		14,162		71,924		44,414
Securities:
Taxable		28,763		27,166		23,293		108,250		75,805
Tax-exempt		2,545		2,464		3,002		10,763		10,013
Other		28,704		27,040		21,611		105,164		44,677
Total interest income		216,767		216,755		179,974		838,375		591,116

Interest expense:
Deposits		68,339		64,290		28,238		223,179		50,412
Securities loaned		17,247		16,169		13,179		65,175		38,570
Short-term borrowings		13,495		14,212		10,278		57,857		20,893
Notes payable		3,596		4,026		3,988		15,448		16,141
Other		2,864		2,408		849		9,869		6,125
Total interest expense		105,541		101,105		56,532		371,528		132,141

Net interest income		111,226		115,650		123,442		466,847		458,975
Provision for (reversal of) credit losses		1,265		(40)		3,638		18,392		8,309
Net interest income after provision for (reversal of) credit losses		109,961		115,690		119,804		448,455		450,666

Noninterest income:
Net gains from sale of loans and other mortgage production income		36,387		47,262		35,949		172,150		302,384
Mortgage loan origination fees		32,844		41,478		35,198		144,539		149,598
Securities commissions and fees		33,002		28,044		33,143		121,875		139,122
Investment and securities advisory fees and commissions		35,780		39,662		30,661		134,327		127,399
Other		40,965		40,403		34,833		156,082		113,957
Total noninterest income		178,978		196,849		169,784		728,973		832,460

Noninterest expense:
Employees' compensation and benefits		160,390		173,195		167,892		678,310		773,688
Occupancy and equipment, net		21,524		21,912		23,077		89,326		97,115
Professional services		13,170		12,639		11,555		49,100		48,495
Other		55,761		52,271		50,844		211,573		207,701
Total noninterest expense		250,845		260,017		253,368		1,028,309		1,126,999

Income before income taxes		38,094		52,522		36,220		149,119		156,127
Income tax expense		7,132		13,211		9,642		31,140		36,833
Net income		30,962		39,311		26,578		117,979		119,294
Less: Net income attributable to noncontrolling interest		2,291		2,269		1,022		8,333		6,160
Income attributable to Hilltop	$	28,671	$	37,042	$	25,556	$	109,646	$	113,134

Earnings per common share:
Basic	$	0.44	$	0.57	$	0.40	$	1.69	$	1.61
Diluted	$	0.44	$	0.57	$	0.39	$	1.69	$	1.60

Cash dividends declared per common share	$	0.16	$	0.16	$	0.15	$	0.64	$	0.60

Weighted average shares outstanding:
Basic		65,136		65,106		64,602		65,043		70,434
Diluted		65,138		65,108		64,779		65,045		70,626


	Three Months Ended December 31, 2023
Segment Results					Mortgage				All Other and		Hilltop
(in 000's)	Banking		Broker-Dealer		Origination		Corporate		Eliminations		Consolidated
Net interest income (expense)	$	93,133	$	13,615	$	(4,715)	$	(2,985)	$	12,178	$	111,226
Provision for (reversal of) credit losses		1,350		(85)		—		—		—		1,265
Noninterest income		11,784		106,374		69,185		3,943		(12,308)		178,978
Noninterest expense		55,784		99,960		80,367		14,881		(147)		250,845
Income (loss) before taxes	$	47,783	$	20,114	$	(15,897)	$	(13,923)	$	17	$	38,094


	Year Ended December 31, 2023
Segment Results					Mortgage				All Other and		Hilltop
(in 000's)	Banking		Broker-Dealer		Origination		Corporate		Eliminations		Consolidated
Net interest income (expense)	$	397,936	$	52,894	$	(20,305)	$	(12,961)	$	49,283	$	466,847
Provision for (reversal of) credit losses		18,525		(133)		—		—		—		18,392
Noninterest income		45,830		403,538		316,840		12,887		(50,122)		728,973
Noninterest expense		226,234		383,024		359,285		60,631		(865)		1,028,309
Income (loss) before taxes	$	199,007	$	73,541	$	(62,750)	$	(60,705)	$	26	$	149,119


	Three Months Ended						Year Ended
	December 31,		September 30,		December 31,		December 31,		December 31,
Selected Financial Data	2023		2023		2022		2023		2022

Hilltop Consolidated:
Return on average stockholders' equity		5.46%		7.11%		4.99%		5.31%		5.11%
Return on average assets		0.75%		0.94%		0.63%		0.71%		0.69%
Net interest margin ⁽¹⁾		2.96%		3.02%		3.23%		3.07%		2.87%
Net interest margin (taxable equivalent) ⁽²⁾:
As reported		2.98%		3.04%		3.24%		3.09%		2.88%
Impact of purchase accounting		4 bps		7 bps		7 bps		6 bps		7 bps
Book value per common share ($)		32.58		31.91		31.49		32.58		31.49
Shares outstanding, end of period (000's)		65,153		65,170		64,685		65,153		64,685
Dividend payout ratio ⁽³⁾		36.35%		28.12%		37.92%		37.97%		37.36%

Banking Segment:
Net interest margin ⁽¹⁾		2.94%		3.08%		3.42%		3.13%		3.11%
Net interest margin (taxable equivalent)⁽²⁾:
As reported		2.95%		3.09%		3.43%		3.14%		3.11%
Impact of purchase accounting		5 bps		8 bps		8 bps		7 bps		9 bps
Accretion of discount on loans ($000's)		1,202		2,226		2,173		8,632		10,552
Net recoveries (charge-offs) ($000's)		(674)		1,556		21		(2,421)		(4,219)
Return on average assets		1.12%		1.20%		1.31%		1.15%		1.19%
Fee income ratio		11.2%		10.5%		9.8%		10.3%		10.7%
Efficiency ratio		53.2%		51.4%		48.9%		51.0%		50.8%
Employees' compensation and benefits ($000's)		29,420		30,641		34,526		123,345		137,531

Broker-Dealer Segment:
Net revenue ($000's) ⁽⁴⁾		119,989		118,703		106,919		456,432		393,540
Employees' compensation and benefits ($000's)		68,746		69,930		60,552		266,395		251,145
Variable compensation expense ($000's)		39,435		39,929		32,042		144,984		138,705
Compensation as a % of net revenue		57.3%		58.9%		56.6%		58.4%		63.8%
Pre-tax margin ⁽⁵⁾		16.8%		18.2%		18.5%		16.1%		9.6%

Mortgage Origination Segment:
Mortgage loan originations - volume ($000's):
Home purchases		1,698,009		2,091,444		1,895,731		7,701,758		10,823,002
Refinancings		117,018		152,257		147,511		541,373		1,837,154
Total mortgage loan originations - volume		1,815,027		2,243,701		2,043,242		8,243,131		12,660,156
Mortgage loan sales - volume ($000's)		1,874,001		2,395,357		2,038,990		8,046,585		13,200,471
Net gains from mortgage loan sales (basis points):
Loans sold to third parties		189		199		211		198		263
Impact of loans retained by banking segment		0		(1)		(19)		(4)		(11)
As reported		189		198		192		194		252
Mortgage servicing rights asset ($000's) ⁽⁶⁾		96,662		104,951		100,825		96,662		100,825
Employees' compensation and benefits ($000's)		53,766		64,016		64,940		251,119		353,973
Variable compensation expense ($000's)		24,085		33,070		26,724		118,977		183,804

(1)	Net interest margin is defined as net interest income divided by average interest-earning assets.

(2)

Net interest margin (taxable equivalent), a non-GAAP measure, is defined as taxable equivalent net interest income divided by average interest-earning assets. Taxable equivalent adjustments are based on the applicable 21% federal income tax rate for all periods presented. The interest income earned on certain earning assets is completely or partially exempt from federal income tax. As such, these tax-exempt instruments typically yield lower returns than taxable investments. To provide more meaningful comparisons of net interest margins for all earning assets, we use net interest income on a taxable-equivalent basis in calculating net interest margin by increasing the interest income earned on tax-exempt assets to make it fully equivalent to interest income earned on taxable investments. The taxable equivalent adjustments to interest income for Hilltop (consolidated) were $0.6 million, $0.6 million, $0.3 million, $2.7 million and $1.6 million, respectively, for the periods presented and for the banking segment were $0.2 million, $0.2 million, $0.2 million, $0.7 million and $0.8 million for each of the periods presented.

(3)	Dividend payout ratio is defined as cash dividends declared per common share divided by basic earnings per common share.

(4)	Net revenue is defined as the sum of total broker-dealer net interest income and total broker-dealer noninterest income.

(5)	Pre-tax margin is defined as income before income taxes divided by net revenue.

(6)	Reported on a consolidated basis and therefore does not include mortgage servicing rights assets related to loans serviced for the banking segment, which are eliminated in consolidation.


	December 31,		September 30,		June 30,		March 31,		December 31,
Capital Ratios	2023		2023		2023		2023		2022
Tier 1 capital (to average assets):
PlainsCapital		10.55%		10.62%		10.28%		10.69%		10.26%
Hilltop		12.23%		11.92%		11.47%		11.82%		11.47%
Common equity Tier 1 capital (to risk-weighted assets):
PlainsCapital		15.43%		15.31%		14.48%		14.97%		14.98%
Hilltop		19.31%		18.60%		17.61%		17.99%		18.23%
Tier 1 capital (to risk-weighted assets):
PlainsCapital		15.43%		15.31%		14.48%		14.97%		14.98%
Hilltop		19.31%		18.60%		17.61%		17.99%		18.23%
Total capital (to risk-weighted assets):
PlainsCapital		16.57%		16.45%		15.56%		15.94%		15.91%
Hilltop		22.33%		21.54%		20.41%		20.75%		20.98%


	December 31,		September 30,		June 30,		March 31,		December 31,
Non-Performing Assets Portfolio Data	2023		2023		2023		2023		2022
Loans accounted for on a non-accrual basis ($000's):
Commercial real estate:
Non-owner occupied		36,440		2,375		2,456		1,038		1,250
Owner occupied		5,098		4,964		1,096		935		3,019
Commercial and industrial		9,502		10,190		21,442		10,807		9,095
Construction and land development		3,480		760		593		199		198
1-4 family residential		13,801		13,202		13,360		14,387		15,941
Consumer		6		7		9		12		14
Broker-dealer		—		—		—		—		—
		68,327		31,498		38,956		27,378		29,517
Troubled debt restructurings included in accruing loans held for investment ($000's) ⁽¹⁾		—		—		—		—		803
Non-performing loans ($000's) ⁽¹⁾		68,327		31,498		38,956		27,378		30,320

Non-performing loans as a % of total loans ($000's) ⁽¹⁾		0.76%		0.34%		0.40%		0.30%		0.33%

Other real estate owned ($000's)		5,095		5,386		3,481		3,202		2,325

Other repossessed assets ($000's)		—		—		—		—		—

Non-performing assets ($000's) ⁽¹⁾		73,422		36,884		42,437		30,580		32,645

Non-performing assets as a % of total assets ($000's) ⁽¹⁾		0.45%		0.22%		0.25%		0.18%		0.20%

Loans past due 90 days or more and still accruing ($000's) ⁽²⁾		115,090		106,346		130,036		114,523		92,099

(1)	Effective January 1, 2023, we adopted Accounting Standards Update (“ASU”) 2022-02 which eliminated the recognition and measurement guidance on troubled debt restructurings for creditors. Therefore, we no longer present troubled debt restructurings as a component of non-performing loans and assets.

(2)	Loans past due 90 days or more and still accruing were primarily comprised of loans held for sale and guaranteed by U.S. government agencies, including loans that are subject to repurchase, or have been repurchased, by PrimeLending.


	Three Months Ended December 31,
	2023						2022
	Average		Interest		Annualized		Average		Interest		Annualized
	Outstanding		Earned		Yield or		Outstanding		Earned		Yield or
Net Interest Margin (Taxable Equivalent) Details ⁽¹⁾	Balance		or Paid		Rate		Balance		or Paid		Rate
Assets
Interest-earning assets
Loans held for sale	$	841,715	$	13,239	6.29	%	$	882,322	$	11,634	5.27	%
Loans held for investment, gross ⁽²⁾		7,902,814		124,857	6.27	%		7,774,350		106,271	5.42	%
Investment securities - taxable		2,629,808		28,763	4.37	%		2,843,881		23,293	3.28	%
Investment securities - non-taxable ⁽³⁾		313,714		3,157	12.08	%		354,207		3,286	3.71	%
Federal funds sold and securities purchased under agreements to resell		153,785		2,082	5.37	%		161,632		2,173	5.33	%
Interest-bearing deposits in other financial institutions		1,646,885		21,948	5.29	%		1,749,902		15,751	3.57	%
Securities borrowed		1,371,092		18,659	5.33	%		1,350,873		14,162	4.10	%
Other		48,120		4,675	38.54	%		56,196		3,686	26.02	%
Interest-earning assets, gross ⁽³⁾		14,907,933		217,380	5.79	%		15,173,363		180,256	4.71	%
Allowance for credit losses		(110,832)						(92,344)
Interest-earning assets, net		14,797,101						15,081,019
Noninterest-earning assets		1,473,839						1,637,202
Total assets	$	16,270,940					$	16,718,221

Liabilities and Stockholders' Equity
Interest-bearing liabilities
Interest-bearing deposits	$	7,966,770	$	68,339	3.40	%	$	7,154,802	$	28,238	1.57	%
Securities loaned		1,324,887		17,247	5.16	%		1,274,038		13,179	4.10	%
Notes payable and other borrowings		1,439,297		19,955	5.50	%		1,355,809		15,114	4.42	%
Total interest-bearing liabilities		10,730,954		105,541	3.90	%		9,784,649		56,531	2.29	%
Noninterest-bearing liabilities
Noninterest-bearing deposits		3,096,244						4,222,143
Other liabilities		335,307						652,900
Total liabilities		14,162,505						14,659,692
Stockholders’ equity		2,081,833						2,032,194
Noncontrolling interest		26,602						26,335
Total liabilities and stockholders' equity	$	16,270,940					$	16,718,221

Net interest income ⁽³⁾			$	111,839					$	123,725
Net interest spread ⁽³⁾					1.89	%					2.42	%
Net interest margin ⁽³⁾					2.98	%					3.24	%


	Year Ended December 31,
	2023						2022
	Average		Interest		Annualized		Average		Interest		Annualized
	Outstanding		Earned		Yield or		Outstanding		Earned		Yield or
Net Interest Margin (Taxable Equivalent) Details ⁽¹⁾	Balance		or Paid		Rate		Balance		or Paid		Rate
Assets
Interest-earning assets
Loans held for sale	$	944,470	$	53,736	5.69	%	$	1,221,235	$	52,315	4.28	%
Loans held for investment, gross ⁽²⁾		7,950,878		488,538	6.23	%		7,840,848		363,892	4.71	%
Investment securities - taxable		2,726,763		108,250	3.97	%		2,819,282		75,805	2.69	%
Investment securities - non-taxable ⁽³⁾		363,493		13,463	3.70	%		310,315		11,608	3.74	%
Federal funds sold and securities purchased under agreements to resell		145,696		8,954	6.15	%		162,575		4,098	2.52	%
Interest-bearing deposits in other financial institutions		1,597,865		79,657	4.99	%		2,306,960		31,705	1.37	%
Securities borrowed		1,409,765		71,924	5.03	%		1,298,276		44,414	3.37	%
Other		65,912		16,554	25.11	%		55,280		8,873	16.05	%
Interest-earning assets, gross ⁽³⁾		15,204,842		841,076	5.53	%		16,014,771		592,710	3.70	%
Allowance for credit losses		(103,975)						(92,828)
Interest-earning assets, net		15,100,867						15,921,943
Noninterest-earning assets		1,404,393						1,488,970
Total assets	$	16,505,260					$	17,410,913

Liabilities and Stockholders' Equity
Interest-bearing liabilities
Interest-bearing deposits	$	7,711,570	$	223,179	2.89	%	$	7,561,501	$	50,412	0.67	%
Securities loaned		1,331,443		65,175	4.90	%		1,184,498		38,570	3.26	%
Notes payable and other borrowings		1,579,170		83,174	5.27	%		1,293,133		43,158	3.34	%
Total interest-bearing liabilities		10,622,183		371,528	3.50	%		10,039,132		132,140	1.32	%
Noninterest-bearing liabilities
Noninterest-bearing deposits		3,441,437						4,455,779
Other liabilities		351,938						675,628
Total liabilities		14,415,558						15,170,539
Stockholders’ equity		2,063,174						2,213,733
Noncontrolling interest		26,528						26,641
Total liabilities and stockholders' equity	$	16,505,260					$	17,410,913

Net interest income ⁽³⁾			$	469,548					$	460,570
Net interest spread ⁽³⁾					2.03	%					2.38	%
Net interest margin ⁽³⁾					3.09	%					2.88	%

(1)	Information presented on a consolidated basis.

(2)	Average balance includes non-accrual loans.

(3)

Presented on a taxable-equivalent basis with annualized taxable equivalent adjustments based on the applicable 21% federal income tax rate for the periods presented. The adjustment to interest income was $0.6 million and $0.3 million for the three months ended December 31, 2023 and 2022, respectively, and $2.7 million and $1.6 million for the year ended December 31, 2023 and 2022, respectively.

Conference Call Information

Hilltop will host a live webcast and conference call at 8:00 AM Central (9:00 AM Eastern) on Friday, January 26, 2024. Hilltop President and CEO Jeremy B. Ford and Hilltop CFO William B. Furr will review fourth quarter and full year 2023 financial results. Interested parties can access the conference call by dialing 1-888-886-7786 (North America) or 1-416-764-8658 (International) and then using the access code 16475706. The conference call also will be webcast simultaneously on Hilltop’s Investor Relations website (http://ir.hilltop-holdings.com).

About Hilltop

Hilltop Holdings is a Dallas-based financial holding company. Its primary line of business is to provide business and consumer banking services from offices located throughout Texas through PlainsCapital Bank. PlainsCapital Bank’s wholly owned subsidiary, PrimeLending, provides residential mortgage lending throughout the United States. Hilltop Holdings’ broker-dealer subsidiaries, Hilltop Securities Inc. and Momentum Independent Network Inc., provide a full complement of securities brokerage, institutional and investment banking services in addition to clearing services and retail financial advisory. At December 31, 2023, Hilltop employed approximately 3,900 people and operated approximately 336 locations in 48 states. Hilltop Holdings’ common stock is listed on the New York Stock Exchange under the symbol “HTH.” Find more information at Hilltop-Holdings.com, PlainsCapital.com, PrimeLending.com and HilltopSecurities.com.

FORWARD-LOOKING STATEMENTS

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements anticipated in such statements. Forward-looking statements speak only as of the date they are made and, except as required by law, we do not assume any duty to update forward-looking statements. Such forward-looking statements include, but are not limited to, statements concerning such things as our plans, objectives, strategies, expectations, intentions and other statements that are not statements of historical fact, and may be identified by words such as “anticipates,” “believes,” “building,” “continue,” “could,” “drive,” “estimates,” “expects,” “extent,” “focus,” “forecasts,” “goal,” “guidance,” “intends,” “may,” “might,” “outlook,” “plan,” “position,” “probable,” “progressing,” “projects,” “prudent,” “seeks,” “should,” “target,” “view,” “will” or “would” or the negative of these words and phrases or similar words or phrases. The following factors, among others, could cause actual results to differ materially from those set forth in the forward-looking statements: (i) the credit risks of lending activities, including our ability to estimate credit losses and the allowance for credit losses, as well as the effects of changes in the level of, and trends in, loan delinquencies and write-offs; (ii) effectiveness of our data security controls in the face of cyber attacks and any legal, reputational and financial risks following a cybersecurity incident; (iii) changes in general economic, market and business conditions in areas or markets where we compete, including changes in the price of crude oil; (iv) changes in the interest rate environment; (v) risks associated with concentration in real estate related loans and (vi) disruptions to the economy and financial services industry, risks associated with uninsured deposits and responsive measures by federal or state governments or banking regulators, including increases in the cost of our deposit insurance assessments. For further discussion of such factors, see the risk factors described in our most recent Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q and other reports that are filed with the Securities and Exchange Commission. All forward-looking statements are qualified in their entirety by this cautionary statement.

Source: Hilltop Holdings Inc.

Hilltop (HTH) 8-KHilltop Holdings Inc. Announces Financial Results for Fourth Quarter and Full Year 2023