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Veritex Holdings, Inc. (VBTX) SEC Filing 8-K Material Event for the period ending Tuesday, April 26, 2022

Veritex Holdings, Inc.

HISTORY TOOLS
CIK: 1501570 Ticker: VBTX
Exhibit 99.1
VERITEX HOLDINGS, INC. REPORTS FIRST QUARTER OPERATING RESULTS

Dallas, TX — April 26, 2022 —Veritex Holdings, Inc. (“Veritex”, the “Company”, “we” or “our”) (Nasdaq: VBTX), the holding company for Veritex Community Bank, today announced the results for the quarter ended March 31, 2022.
“The first quarter of 2022 was another outstanding financial and growth quarter for our Company,” said President and CEO, C. Malcolm C. Holland, III. “We reported operating diluted EPS of $0.66 and delivered outstanding growth this quarter reflected by overall annualized loan growth of 21% and annualized deposit growth of 29%. We continue our focus on growth, investing in experienced and proven talent and maximizing shareholder returns.”

Quarter to Date
Financial HighlightsQ1 2022Q4 2021Q1 2021
(Dollars in thousands, except per share data)
(unaudited)
GAAP
Net income$33,470 $41,506 $31,787 
Diluted EPS0.65 0.82 0.64 
Book value per common share26.86 26.64 24.96 
Return on average assets2
1.36 %1.68 %1.44 %
Efficiency ratio52.84 48.53 49.62 
Return on average equity2
10.00 12.65 10.53 
Non-GAAP1
Operating earnings$34,014 $42,410 $32,213 
Diluted operating EPS0.66 0.84 0.64 
Tangible book value per common share18.51 17.49 16.34 
Pre-tax, pre-provision operating earnings42,265 48,640 40,210 
Pre-tax, pre-provision operating return on average assets2
1.71 %1.97 %1.82 %
Operating return on average assets2
1.38 1.72 1.46 
Operating efficiency ratio52.05 47.64 49.62 
Return on average tangible common equity2
15.84 20.06 17.17 
Operating return on average tangible common equity2
16.08 20.48 17.39 
1 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.
2 Annualized ratio.

Other First Quarter Highlights

•Total loans held for investment (“LHI”), excluding mortgage warehouse (“MW”) and paycheck protection program (“PPP”) loans, grew $359.4 million, or 21.2% annualized, during the three months ended March 31, 2022 from $6.8 billion at the end of the fourth quarter of 2021;
•Total deposits grew $526.0 million, or 28.6% annualized, with the average cost of total deposits decreasing to 0.17% for the three months ended March 31, 2022 from 0.18% and 0.31% from the three months ended December 31, 2021 and March 31, 2021, respectively;
•Non-performing assets (“NPAs”) to total assets decreased to 0.46%, or 5 bps from December 31, 2021 and 46 bps from March 31, 2021, respectively;
•Completed common stock offering with net proceeds, after deducting underwriting discounts and offering expenses, of approximately $153.8 million;
•Announced proposed transaction to acquire interLINK, a technology-enabled deposit gathering and processing platform, to (i) enhance liquidity with flexible and scalable access to approximately $5.7 billion in highly diversified, scalable core deposits and (ii) provide low-cost, stable core deposits to fund sustainable long-term growth. The acquisition is expected to close in the third quarter of 2022, subject to satisfaction of customary closing conditions, including receipt of regulatory approvals from the FDIC and the Texas Department of Banking; and
•Declared quarterly cash dividend of $0.20 per share of outstanding common stock payable on May 27, 2022.

1


Results of Operations for the Three Months Ended March 31, 2022
Net Interest Income
For the three months ended March 31, 2022, net interest income before provision for credit losses was $73.0 million and net interest margin was 3.22% compared to $76.7 million and 3.37%, respectively, for the three months ended December 31, 2021. The $3.7 million decrease in net interest income before provision for credit losses was primarily due to a $2.7 million decrease in interest income on loans driven by a decrease in average balances during the three months ended March 31, 2022 and recovery income recognized on fully paid off nonaccrual loans during the three months ended December 31, 2021, with no corresponding recovery income during the three months ended March 31, 2022. Further, this decrease was due to the recognition of $2.1 million of prepayment penalty income on debt securities during the three months ended December 31, 2021, with no corresponding prepayment penalty income recognized during the three months ended March 31, 2022. The decrease in net interest income was slightly offset by a $359 thousand decrease in interest expense on subordinated debentures and subordinated notes and a $281 thousand decrease in interest expense on certificates and other time deposits during the three months ended March 31, 2022. Net interest margin decreased 15 basis points compared to the three months ended December 31, 2021, primarily due to the increase in yields earned on debt securities as a result of the recognition of $2.1 million of prepayment penalty income during three months ended December 31, 2021 with no corresponding prepayment penalty income during the three months ended March 31, 2022. There was no change in the average cost of interest-bearing deposits for the linked quarters.
Compared to the three months ended March 31, 2021, net interest income before provision for credit losses for the three months ended March 31, 2022 increased by $7.4 million, or 11.3%. The increase was primarily due to a $4.0 million increase in interest income on loans driven by an increase in average balances and a $1.7 million decrease in interest expenses on certificates and other time deposits. As a result, the average cost of interest-bearing deposits decreased 19 basis points to 0.26% for the three months ended March 31, 2022 from 0.45% for the three months ended March 31, 2021.

Noninterest Income
Noninterest income for the three months ended March 31, 2022 was $15.1 million, a decrease of $1.1 million, or 6.5%, compared to the three months ended December 31, 2021. The decrease was primarily due to a decrease of $1.4 million in insurance income from BOLI and a decrease of $870 thousand in equity method investment income, offset by a $1.5 million increase in government guaranteed loan income, net.
Compared to the three months ended March 31, 2021, noninterest income for the three months ended March 31, 2022 increased by $925 thousand, or 6.5%. The increase was primarily due to an increase of $1.5 million in loan fees and an increase of $1.1 million in service charges and fees on deposit accounts, offset by a decrease of $1.7 million in government guaranteed loan income, net.

Noninterest Expense
Noninterest expense was $46.6 million for the three months ended March 31, 2022, compared to $45.1 million for the three months ended December 31, 2021, an increase of $1.5 million, or 3.3%. This increase was primarily due to a $2.1 million increase in salaries and employee benefits primarily driven by (i) a $1.2 million increase in FICA taxes, (ii) a $960 thousand increase in stock-based compensation resulting from the vesting of February 1, 2019 performance restricted stock unit awards which vested at 150% due the Company performing at the top quartile of total shareholder return (as defined by the equity awards) and (iii) a $531 thousand increase in salaries as a result of our continued investment in talent which was slightly offset by a $333 thousand decrease in stock-based compensation associate with non-qualified stock options.
Compared to the three months ended March 31, 2021, noninterest expense for the three months ended March 31, 2022 increased by $7.0 million, or 17.6%. The increase was primarily driven by a $4.6 million increase in salaries and employee benefits as a result of a (i) $2.7 million increase in salaries resulting from continued investment in talent, (ii) a $960 thousand increase in stock-based compensation resulting from the vesting of February 1, 2019 performance restricted stock unit awards which vested at 150% due the Company performing at the top quartile of total shareholder return (as defined by the equity awards) and (iii) a $829 thousand increase in FICA taxes. The increase was also due to a $700 thousand increase in merger and acquisition expenses recognized during the three months ended March 31, 2022.
2


Financial Condition
Total LHI, excluding MW and PPP loans, were $7.1 billion at March 31, 2022, an increase of $359.4 million, or 21.2% annualized, compared to December 31, 2021. The increase was the result of the continued execution and success of our loan growth strategy.
Total deposits were $7.9 billion at March 31, 2022, an increase of $526.0 million, or 28.6% annualized, compared to December 31, 2021. The increase was primarily the result of increases of $412.0 million in interest-bearing transaction and savings deposits and an increase of $255.2 million in noninterest-bearing demand deposits, offset by a decrease of $141.2 million in certificates and other time deposits.

Asset Quality
Nonperforming assets totaled $48.0 million, or 0.46% of total assets at March 31, 2022, compared to $50.1 million, or 0.51% of total assets, at December 31, 2021. The Company had net charge-offs of $4.8 million for the quarter, which were fully reserved against in prior quarters under our allowance for credit loss (“ACL”) model.
The Company recorded a benefit for credit losses of $500 thousand and $3.3 million for the three months ended March 31, 2022 and December 31, 2021, respectively, compared to no provision for credit losses for the three months ended March 31, 2021. The recorded benefit for credit losses for the three months ended March 31, 2022, compared to the three months ended December 31, 2021, was primarily attributable to a decrease in specific reserves on certain nonaccrual loans slightly offset by an increase in general reserves as a result of continued loan growth. For the three months ended March 31, 2022, we also recorded a $493 thousand provision for unfunded commitments, which was attributable to higher unfunded balances. ACL as a percentage of LHI, excluding MW and PPP loans, was 1.02%, 1.15% and 1.76% at March 31, 2022, December 31, 2021 and March 31, 2021, respectively.

Dividend Information

On April 26, 2022, 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 or after May 27, 2022 to stockholders of record as of the close of business on May 13, 2022.

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, 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, April 27, 2022 at 8:30 a.m. Central Time. Participants may pre-register for the call by visiting https://edge.media-server.com/mmc/p/chbsqqsh and will receive a unique PIN, which can be used when dialing in for the call. This will allow attendees to access the call immediately. Alternatively, participants may call toll-free at (877) 703-9880.

The call and corresponding presentation slides will be webcast live on the home page of the Company's website, https://ir.veritexbank.com/. An audio replay will be available one hour after the conclusion of the call at (855) 859-2056, Conference
#9446379 . This replay, as well as the webcast, will be available until May 4, 2022.

3

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.

Media and Investor Relations:
investorrelations@veritexbank.com
Forward-Looking Statements
This earnings release contains certain “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 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 date of Veritex’s quarterly cash dividend, the impact of certain changes in Veritex’s accounting policies, standards and interpretations, the effects of the COVID-19 pandemic and actions taken in response thereto, 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,” “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, 2021 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 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.
4

VERITEX HOLDINGS, INC. AND SUBSIDIARIES
Financial Highlights
(Unaudited)
 For the Quarter Ended
Mar 31, 2022Dec 31, 2021Sep 30, 2021Jun 30, 2021Mar 31, 2021
(Dollars and shares in thousands)
Per Share Data (Common Stock):
Basic EPS$0.66 $0.84 $0.75 $0.60 $0.64 
Diluted EPS0.65 0.82 0.73 0.59 0.64 
Book value per common share26.86 26.64 26.09 25.72 24.96 
Tangible book value per common share1
18.51 17.49 17.53 17.16 16.34 
     Dividends paid per common share outstanding2
0.20 0.20 0.20 0.20 0.17 
Common Stock Data:
Shares outstanding at period end53,907 49,372 49,229 49,498 49,433 
Weighted average basic shares outstanding for the period50,695 49,329 49,423 49,476 49,394 
Weighted average diluted shares outstanding for the period51,571 50,441 50,306 50,331 49,998 
Summary of Credit Ratios:
ACL to total LHI, excluding MW and PPP loans1.02 %1.15 %1.42 %1.59 %1.76 %
NPAs to total assets0.46 0.51 0.77 0.85 0.92 
Net charge-offs to average loans outstanding0.07 0.19 0.09 0.09 — 
Summary Performance Ratios:   
Return on average assets3
1.36 1.68 1.56 1.27 1.44 
Return on average equity3
10.00 12.65 11.32 9.42 10.53 
Return on average tangible common equity1, 3
15.84 20.06 17.72 15.18 17.17 
Efficiency ratio52.84 48.53 47.55 52.42 49.62 
     Net interest margin
3.22 3.37 3.26 3.11 3.22 
Selected Performance Metrics - Operating:
Diluted operating EPS1
$0.66 $0.84 $0.70 $0.60 $0.64 
Pre-tax, pre-provision operating return on average assets1, 2
1.71 %1.97 %1.85 %1.66 %1.82 %
Operating return on average assets1, 3
1.38 1.72 1.48 1.29 1.46 
Operating return on average tangible common equity1, 3
16.08 20.48 16.92 15.42 17.39 
Operating efficiency ratio1
52.05 47.64 48.51 51.63 49.62 
Veritex Holdings, Inc. Capital Ratios:   
Average stockholders' equity to average total assets13.58 %13.30 %13.75 %13.46 %13.69 %
Tangible common equity to tangible assets1
9.98 9.28 9.43 9.51 9.17 
Tier 1 capital to average assets (leverage)10.66 9.05 9.54 9.38 9.50 
Common equity tier 1 capital9.84 8.58 8.75 9.03 9.27 
Tier 1 capital to risk-weighted assets10.14 8.89 9.06 9.36 9.61 
Total capital to risk-weighted assets12.73 11.60 12.31 12.86 13.38 

1Refer 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.
2Dividend amount represents dividend paid per common share subsequent to each respective quarter end.
3Annualized ratio for quarterly metrics.


5

VERITEX HOLDINGS, INC. AND SUBSIDIARIES
Financial Highlights
(In thousands)
 
Mar 31, 2022Dec 31, 2021Sep 30, 2021Jun 30, 2021Mar 31, 2021
(unaudited)(unaudited)(unaudited)(unaudited)
ASSETS    
Cash and cash equivalents$551,573 $379,784 $229,712 $390,027 $468,029 
Debt securities1,244,514 1,052,494 1,103,745 1,125,877 1,077,860 
Other investments188,699 190,591 191,786 87,558 87,226 
Loans held for sale18,721 26,007 18,896 12,065 19,864 
LHI, PPP loans, carried at fair value18,512 53,369 135,842 291,401 407,353 
LHI, MW542,877 565,645 615,045 559,939 599,001 
LHI, excluding MW and PPP7,125,429 6,766,009 6,615,905 6,272,087 5,963,493 
Total loans7,705,539 7,411,030 7,385,688 7,135,492 6,989,711 
ACL(72,485)(77,754)(93,771)(99,543)(104,936)
Bank-owned life insurance83,641 83,194 83,781 83,304 83,318 
Bank premises, furniture and equipment, net109,138 109,271 116,063 123,504 114,585 
Other real estate owned (“OREO”)1,062 — — 2,467 2,337 
Intangible assets, net of accumulated amortization63,986 66,017 54,682 57,143 59,236 
Goodwill404,452 403,771 370,840 370,840 370,840 
Other assets173,561 138,851 129,774 72,856 89,304 
Total assets$10,453,680 $9,757,249 $9,572,300 $9,349,525 $9,237,510 
LIABILITIES AND STOCKHOLDERS’ EQUITY     
Deposits:     
Noninterest-bearing deposits$2,765,895 $2,510,723 $2,302,925 $2,388,068 $2,171,719 
Interest-bearing transaction and savings deposits3,688,292 3,276,312 3,228,306 3,112,974 3,189,693 
Certificates and other time deposits1,435,409 1,576,580 1,647,521 1,477,860 1,543,158 
Total deposits7,889,596 7,363,615 7,178,752 6,978,902 6,904,570 
Accounts payable and other liabilities105,552 69,160 66,571 55,499 55,902 
Advances from Federal Home Loan Bank (“FHLB”)777,522 777,562 777,601 777,640 777,679 
Subordinated debentures and subordinated notes228,018 227,764 262,761 262,766 262,774 
Securities sold under agreements to repurchase4,996 4,069 2,455 1,811 2,777 
Total liabilities9,005,684 8,442,170 8,288,140 8,076,618 8,003,702 
Commitments and contingencies    
Stockholders’ equity:     
Common stock605 560 559 558 557 
Additional paid-in capital1,297,161 1,142,758 1,137,889 1,134,603 1,131,324 
Retained earnings298,830 275,273 243,633 216,704 195,661 
Accumulated other comprehensive income18,982 64,070 69,661 77,189 62,413 
Treasury stock
(167,582)(167,582)(167,582)(156,147)(156,147)
Total stockholders’ equity1,447,996 1,315,079 1,284,160 1,272,907 1,233,808 
Total liabilities and stockholders’ equity$10,453,680 $9,757,249 $9,572,300 $9,349,525 $9,237,510 

6

VERITEX HOLDINGS, INC. AND SUBSIDIARIES
Financial Highlights
(In thousands, except per share data)
 For the Quarter Ended
Mar 31, 2022Dec 31, 2021Sep 30, 2021Jun 30, 2021Mar 31, 2021
Interest income:     
Loans, including fees$71,443 $74,174 $71,139 $67,814 $67,399 
Debt securities7,762 9,553 7,613 7,529 7,437 
Deposits in financial institutions and Fed Funds sold262 165 130 167 127 
Equity securities and other investments910 1,004 898 672 663 
Total interest income80,377 84,896 79,780 76,182 75,626 
Interest expense:   
Transaction and savings deposits1,751 1,629 1,588 1,661 1,980 
Certificates and other time deposits1,380 1,661 1,934 2,423 3,061 
Advances from FHLB1,547 1,847 1,848 1,829 1,812 
Subordinated debentures and subordinated notes2,659 3,018 3,134 3,138 3,138 
Total interest expense7,337 8,155 8,504 9,051 9,991 
Net interest income73,040 76,741 71,276 67,131 65,635 
(Benefit) provision for credit losses(500)(3,349)— — — 
Provision (benefit) for unfunded commitments493 (1,040)(448)577 (570)
Net interest income after provisions73,047 81,130 71,724 66,554 66,205 
Noninterest income:   
Service charges and fees on deposit accounts4,710 4,782 4,484 3,847 3,629 
Loan fees2,794 2,697 1,746 1,823 1,341 
Loss on sales of investment securities— — (188)— — 
Gain on sales of mortgage loans held for sale307 293 407 385 507 
Government guaranteed loan income, net4,891 3,423 2,341 3,448 6,548 
Equity method investment income367 1,238 4,522 — — 
Other2,028 3,717 2,315 2,953 2,147 
Total noninterest income15,097 16,150 15,627 12,456 14,172 
Noninterest expense:   
Salaries and employee benefits27,513 25,401 22,964 23,451 22,932 
Occupancy and equipment4,517 4,398 4,536 4,233 4,096 
Professional and regulatory fees3,158 3,017 3,401 3,086 3,441 
Data processing and software expense2,921 2,597 2,494 2,536 2,319 
Marketing1,187 1,443 1,151 1,841 909 
Amortization of intangibles2,495 2,494 2,509 2,517 2,537 
Telephone and communications385 380 380 337 337 
Merger and acquisition (“M&A”) expense700 826 — — — 
Other3,696 4,521 3,886 3,716 3,026 
Total noninterest expense46,572 45,077 41,321 41,717 39,597 
Income before income tax expense41,572 52,203 46,030 37,293 40,780 
Income tax expense8,102 10,697 9,195 7,837 8,993 
Net income$33,470 $41,506 $36,835 $29,456 $31,787 
Basic EPS$0.66 $0.84 $0.75 $0.60 $0.64 
Diluted EPS$0.65 $0.82 $0.73 $0.59 $0.64 
Weighted average basic shares outstanding50,695 49,329 49,423 49,476 49,394 
Weighted average diluted shares outstanding51,571 50,441 50,306 50,331 49,998 

7

VERITEX HOLDINGS, INC. AND SUBSIDIARIES
Financial Highlights
(Unaudited)
 
 For the Quarter Ended
 March 31, 2022December 31, 2021March 31, 2021
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
(In thousands, expect percentages)
Assets         
Interest-earning assets:         
Loans1
$6,872,943 $68,297 4.03 %$6,777,397 $70,334 4.12 %$5,897,815 $62,702 4.31 %
LHI, MW421,680 3,069 2.95 483,850 3,629 2.98 510,678 3,815 3.03 
PPP loans31,335 77 1.00 83,553 211 1.00 356,356 882 1.00 
Debt securities1,140,834 7,762 2.76 1,092,089 9,553 3.47 1,063,538 7,437 2.84 
Interest-bearing deposits in other banks554,864 262 0.19 417,266 165 0.16 341,483 127 0.15 
Equity securities and other investments190,002 910 1.94 191,031 1,004 2.09 87,178 663 3.08 
Total interest-earning assets9,211,658 80,377 3.54 9,045,186 84,896 3.72 8,257,048 75,626 3.71 
ACL(77,843)  (95,218)  (105,972)  
Noninterest-earning assets865,107   838,703   790,195   
Total assets$9,998,922   $9,788,671   $8,941,271   
Liabilities and Stockholders’ Equity         
Interest-bearing liabilities:         
Interest-bearing demand and savings deposits$3,471,645 $1,751 0.20 %$3,357,958 $1,629 0.19 %$3,038,586 $1,980 0.26 %
Certificates and other time deposits1,501,852 1,380 0.37 1,615,066 1,661 0.41 1,509,836 3,061 0.82 
Advances from FHLB777,538 1,547 0.81 777,577 1,847 0.94 777,694 1,812 0.94 
Subordinated debentures and subordinated notes231,875 2,659 4.65 259,191 3,018 4.62 265,356 3,138 4.80 
Total interest-bearing liabilities5,982,910 7,337 0.50 6,009,792 8,155 0.54 5,591,472 9,991 0.72 
Noninterest-bearing liabilities:         
Noninterest-bearing deposits2,591,504   2,413,443   2,069,233   
Other liabilities67,060   63,760   56,272   
Total liabilities8,641,474   8,486,995   7,716,977   
Stockholders’ equity1,357,448   1,301,676   1,224,294   
Total liabilities and stockholders’ equity$9,998,922   $9,788,671   $8,941,271   
Net interest rate spread2
  3.04 %  3.18 %  2.99 %
Net interest income and margin3
 73,040 3.22 % 76,741 3.37 % 65,635 3.22 %

1 Includes average outstanding balances of loans held for sale of $12,769, $8,987 and $16,602 for the three months ended March 31, 2022, December 31, 2021, and March 31, 2021, respectively, and average balances of LHI, excluding MW and PPP loans.
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.









8

VERITEX HOLDINGS, INC. AND SUBSIDIARIES
Financial Highlights

Yield Trend
 For the Quarter Ended
Mar 31,
2022		Dec 31,
2021		Sep 30,
2021		Jun 30,
2021		Mar 31,
2021
Average yield on interest-earning assets:   
Loans1
4.03 %4.12 %4.16 %4.16 %4.31 %
LHI, MW2.95 2.98 3.15 3.06 3.03 
PPP loans1.00 1.00 1.00 1.00 1.00 
Debt securities2.76 3.47 2.70 2.76 2.84 
Interest-bearing deposits in other banks0.19 0.16 0.15 0.12 0.15 
Equity securities and other investments1.94 2.09 2.13 3.08 3.08 
Total interest-earning assets3.54 %3.72 %3.64 %3.53 %3.71 %
Average rate on interest-bearing liabilities:
Interest-bearing demand and savings deposits0.20 %0.19 %0.20 %0.21 %0.26 %
Certificates and other time deposits0.37 0.41 0.50 0.64 0.82 
Advances from FHLB0.81 0.94 0.94 0.94 0.94 
Subordinated debentures and subordinated notes4.65 4.62 4.70 4.75 4.80 
Total interest-bearing liabilities0.50 %0.54 %0.59 %0.63 %0.72 %
Net interest rate spread2
3.04 %3.18 %3.05 %2.90 %2.99 %
Net interest margin3
3.22 %3.37 %3.26 %3.11 %3.22 %
1Includes average outstanding balances of loans held for sale of $12,769, $8,987, $8,542, $14,364 and $16,602 for the three months ended March 31, 2022, December 31, 2021, September 30, 2021, June 30, 2021 and March 31, 2021, respectively, and average balances of LHI, excluding MW and PPP loans.
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
Mar 31,
2022		Dec 31,
2021		Sep 30,
2021		Jun 30,
2021		Mar 31,
2021
Average cost of interest-bearing deposits0.26 %0.26 %0.30 %0.35 %0.45 %
Average costs of total deposits, including noninterest-bearing0.17 0.18 0.20 0.23 0.31 

9

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

LHI and Deposit Portfolio Composition
Mar 31,
2022		Dec 31,
2021		Sep 30,
2021		Jun 30,
2021		Mar 31,
2021
(In thousands, expect percentages)
LHI1
Commercial$2,125,90029.8 %$2,006,87629.6 %$1,793,74027.1 %$1,771,10028.2 %$1,632,04027.4 %
Real Estate:
Owner occupied commercial (“OOCRE”)633,6158.9 665,5379.8 711,47610.7 744,89911.9 733,31012.3 
Non-owner occupied commercial (“NOOCRE”)2,145,82630.0 2,120,30931.3 2,194,43833.1 1,986,53831.6 1,970,94533.0 
Construction and land1,297,33818.2 1,062,14415.7 936,17414.1 871,76513.9 723,44412.1 
Farmland48,0950.7 55,8270.8 73,5501.1 13,6610.2 14,7510.2 
1-4 family residential 604,4088.5 542,5668.0 543,5188.2 513,6358.2 492,6098.3 
Multi-family residential272,2503.8 310,2414.6 356,8855.4 367,4455.9 386,8446.5 
Consumer9,5330.1 11,9980.2 14,2660.3 10,5300.1 12,4310.2 
Total LHI$7,136,965100 %$6,775,498100 %$6,624,047100 %$6,279,573100 %$5,966,374100 %
MW542,877565,645615,045559,939599,001
PPP loans18,51253,369135,842291,401407,353
Total LHI1
$7,698,354$7,394,512$7,374,934$7,130,913$6,972,728
Deposits
Noninterest-bearing$2,765,89535.1 %$2,510,72334.1 %$2,302,92532.1 %$2,388,06834.1 %$2,171,71931.6 %
Interest-bearing transaction599,5807.6 579,4087.9 514,5377.2 451,3076.5 463,3436.7 
Money market2,958,79037.5 2,568,84334.9 2,585,92636.0 2,539,06136.4 2,602,90337.7 
Savings129,9221.6 128,0611.7 127,8431.8 122,6061.8 123,4471.8 
Certificates and other time deposits1,435,40918.2 1,576,58021.4 1,647,52122.9 1,477,86021.2 1,543,15822.2 
Total deposits$7,889,596100 %$7,363,615100 %$7,178,752100 %$6,978,902100 %$6,904,570100 %
Loan to Deposit Ratio97.6 %100.4 %102.7 %102.2 %101.0 %
Loan to Deposit Ratio, excluding MW and PPP loans90.5 %92.0 %92.3 %90.0 %86.4 %

1 Total LHI does not include deferred fees of $11.5 million, $9.5 million, and $8.1 million at March 31, 2022, December 31, 2021 and September 30, 2021, respectively, deferred costs of $7.5 million and $2.9 million at June 30, 2021 and March 31, 2021, respectively.

10

VERITEX HOLDINGS, INC. AND SUBSIDIARIES
Financial Highlights
(Unaudited)
Asset Quality
 For the Quarter Ended
Mar 31, 2022Dec 31, 2021Sep 30, 2021Jun 30, 2021Mar 31, 2021
(In thousands)
NPAs:    
Nonaccrual loans$46,680$49,687$72,317$76,994$73,594
Accruing loans 90 or more days past due1
2644411,7114629,093
Total nonperforming loans held for investment (“NPLs”)46,94450,12874,02877,45682,687
OREO1,062——2,4672,337
Total NPAs$48,006$50,128$74,028$79,923$85,024
Charge-offs:
1-4 family residential$—$—$(64)$(300)$(15)
OOCRE(1,341)(898)(813)(689)—
NOOCRE(553)(7,936)———
Commercial(3,294)(4,114)(5,508)(5,608)(346)
Consumer(134)(44)(17)(20)(18)
Total charge-offs(5,322)(12,992)(6,402)(6,617)(379)
Recoveries:
1-4 family residential—626293
OOCRE———500—
NOOCRE400————
Commercial14461596659226
Consumer92578362
Total recoveries5533246301,224231
Net charge-offs$(4,769)$(12,668)$(5,772)$(5,393)$(148)
ACL$72,485$77,754$93,771$99,543$104,936
Asset Quality Ratios:
NPAs to total assets0.46 %0.51 %0.77 %0.85 %0.92 %
NPLs to total LHI, excluding MW and PPP loans0.66 0.74 1.12 1.23 1.39 
ACL to total LHI, excluding MW and PPP loans1.02 1.15 1.42 1.59 1.76 
Net charge-offs to average loans outstanding0.07 0.19 0.09 0.09 — 
1 Accruing loans greater than 90 days past due exclude purchase credit deteriorated loans greater than 90 days past due that are accounted for on a pooled basis.




11

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 generally accepted accounting principles as in effect from time to time in the United States (“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 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
Mar 31, 2022Dec 31, 2021Sep 30, 2021Jun 30, 2021Mar 31, 2021
(Dollars in thousands, except per share data)
Tangible Common Equity   
Total stockholders' equity$1,447,996 $1,315,079 $1,284,160 $1,272,907 $1,233,808 
Adjustments:
Goodwill(404,452)(403,771)(370,840)(370,840)(370,840)
Core deposit intangibles(45,560)(47,998)(50,436)(52,873)(55,311)
Tangible common equity$997,984 $863,310 $862,884 $849,194 $807,657 
Common shares outstanding53,907 49,372 49,229 49,498 49,433 
Book value per common share$26.86 $26.64 $26.09 $25.72 $24.96 
Tangible book value per common share$18.51 $17.49 $17.53 $17.16 $16.34 





12

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
Mar 31, 2022Dec 31, 2021Sep 30, 2021Jun 30, 2021Mar 31, 2021
(Dollars in thousands)
Tangible Common Equity   
Total stockholders' equity$1,447,996 $1,315,079 $1,284,160 $1,272,907 $1,233,808 
Adjustments:
Goodwill(404,452)(403,771)(370,840)(370,840)(370,840)
Core deposit intangibles(45,560)(47,998)(50,436)(52,873)(55,311)
Tangible common equity$997,984 $863,310 $862,884 $849,194 $807,657 
Tangible Assets
Total assets$10,453,680 $9,757,249 $9,572,300 $9,349,525 $9,237,510 
Adjustments:
Goodwill(404,452)(403,771)(370,840)(370,840)(370,840)
Core deposit intangibles(45,560)(47,998)(50,436)(52,873)(55,311)
Tangible Assets$10,003,668 $9,305,480 $9,151,024 $8,925,812 $8,811,359 
Tangible Common Equity to Tangible Assets9.98 %9.28 %9.43 %9.51 %9.17 %


13

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
Mar 31, 2022Dec 31, 2021Sep 30, 2021Jun 30, 2021Mar 31, 2021
(Dollars in thousands)
Net income available for common stockholders adjusted for amortization of core deposit intangibles
Net income$33,470 $41,506 $36,835 $29,456 $31,787 
Adjustments:     
Plus: Amortization of core deposit intangibles2,438 2,438 2,438 2,438 2,447 
Less: Tax benefit at the statutory rate512 512 512 512 514 
Net income available for common stockholders adjusted for amortization of core deposit intangibles$35,396 $43,432 $38,761 $31,382 $33,720 
     
Average Tangible Common Equity
Total average stockholders' equity$1,357,448 $1,301,676 $1,290,528 $1,254,371 $1,224,294 
Adjustments:    
Average goodwill(404,014)(393,220)(370,840)(370,840)(370,840)
Average core deposit intangibles(47,158)(49,596)(52,043)(54,471)(56,913)
Average tangible common equity$906,276 $858,860 $867,645 $829,060 $796,541 
Return on Average Tangible Common Equity (Annualized)15.84 %20.06 %17.72 %15.18 %17.17 %

14

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 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 severance payments, plus loss on sale of securities, net, less Thrive PPP loan forgiveness income, plus M&A expenses, 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 non interest expense plus adjustments to operating non interest expense divided by non interest income plus adjustments to operating non interest 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 Three Months Ended
Mar 31, 2022Dec 31, 2021Sep 30, 2021Jun 30, 2021Mar 31, 2021
(Dollars in thousands)
Operating Earnings
Net income$33,470 $41,506 $36,835 $29,456 $31,787 
Plus: Severance payments1
— — — 627 — 
Plus: Loss on sale of securities available for sale, net— — 188 — — 
Less: Thrive PPP loan forgiveness income2
— — 1,912 — — 
Plus: M&A expenses700 826 — — — 
Operating pre-tax income
34,170 42,332 35,111 30,083 31,787 
Less: Tax impact of adjustments156 (78)39 131 — 
Plus: Nonrecurring tax adjustments3
— — — — 426 
Operating earnings$34,014 $42,410 $35,072 $29,952 $32,213 
Weighted average diluted shares outstanding51,571 50,441 50,306 50,331 49,998 
Diluted EPS$0.65 $0.82 $0.73 $0.59 $0.64 
Diluted operating EPS$0.66 $0.84 $0.70 $0.60 $0.64 
1 Severance payments relate to branch restructurings made during the three months ended June 30, 2021.
2 During the third quarter of 2021, Thrive’s PPP loan with another bank was 100% forgiven by the Small Business Administration. As a result of our 49% investment in Thrive, the $1.9 million represents our portion of the PPP loan forgiveness. PPP fee income is not taxable and as such has no tax impact.
3 A nonrecurring tax adjustment of $426 thousand recorded in the first quarter of 2021 was due to a true-up of a deferred tax liability.
15

 For the Quarter Ended
Mar 31, 2022Dec 31, 2021Sep 30, 2021Jun 30, 2021Mar 31, 2021
(Dollars in thousands)
Pre-Tax, Pre-Provision Operating Earnings
Net income$33,470 $41,506 $36,835 $29,456 $31,787 
Plus: Provision for income taxes8,102 10,697 9,195 7,837 8,993 
Plus: (Benefit) provision for credit losses and unfunded commitments(7)(4,389)(448)577 (570)
Plus: Severance payments— — — 627 — 
Plus: Loss on sale of securities, net— — 188 — — 
Less: Thrive PPP loan forgiveness income— — 1,912 — — 
Plus: M&A expenses700 826 — — — 
Pre-tax, pre-provision operating earnings$42,265 $48,640 $43,858 $38,497 $40,210 
Average total assets$9,998,922 $9,788,671 $9,385,470 $9,321,279 $8,941,271 
Pre-tax, pre-provision operating return on average assets1
1.71 %1.97 %1.85 %1.66 %1.82 %
Average total assets$9,998,922 $9,788,671 $9,385,470 $9,321,279 $8,941,271 
Return on average assets1
1.36 %1.68 %1.56 %1.27 %1.44 %
Operating return on average assets1
1.38 1.72 1.48 1.29 1.46 
Operating earnings adjusted for amortization of core deposit intangibles
Operating earnings$34,014 $42,410 $35,072 $29,952 $32,213 
Adjustments:
Plus: Amortization of core deposit intangibles2,438 2,438 2,438 2,438 2,447 
Less: Tax benefit at the statutory rate512 512 512 512 514 
Operating earnings adjusted for amortization of core deposit intangibles$35,940 $44,336 $36,998 $31,878 $34,146 
Average Tangible Common Equity
Total average stockholders' equity$1,357,448 $1,301,676 $1,290,528 $1,254,371 $1,224,294 
Adjustments:     
Less: Average goodwill(404,014)(393,220)(370,840)(370,840)(370,840)
Less: Average core deposit intangibles(47,158)(49,596)(52,043)(54,471)(56,913)
Average tangible common equity$906,276 $858,860 $867,645 $829,060 $796,541 
Operating return on average tangible common equity1
16.08 %20.48 %16.92 %15.42 %17.39 %
Efficiency ratio52.84 %48.53 %47.55 %52.42 %49.62 %
Operating efficiency ratio
Net interest income$73,040 $76,741 $71,276 $67,131 $65,635 
Noninterest income15,097 16,150 15,627 12,456 14,172 
Plus: Loss on sale of securities, net— — 188 — — 
Less: Thrive PPP loan forgiveness income— — 1,912 — — 
Operating noninterest income15,097 16,150 013,903 12,456 14,172 
Noninterest expense46,572 45,077 41,321 41,717 39,597 
Less: Severance payments— — — 627 — 
Less: M&A expenses700 826 — — — 
Operating noninterest expense$45,872 $44,251 $41,321 $41,090 $39,597 
Operating efficiency ratio52.05 %47.64 %48.51 %51.63 %49.62 %
1 Annualized ratio for quarterly metrics..


16

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Veritex Holdings, Inc. provided additional information to their SEC Filing as exhibits

Exhibit 99.1: Additional Exhibits
Exhibit 99.2: Additional Exhibits
Exhibit 99.3: Additional Exhibits
Ticker: VBTX
CIK: 1501570
Form Type: 8-K Corporate News
Accession Number: 0001501570-22-000084
Submitted to the SEC: Tue Apr 26 2022 4:37:30 PM EST
Accepted by the SEC: Tue Apr 26 2022
Period: Tuesday, April 26, 2022
Industry: State Commercial Banks
Events:
  1. Earnings Release
  2. Financial Exhibit
  3. Other Events
  4. Regulated Disclosure

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