-- Historic loan growth, lower funding costs,
and NIM reflect TriState Capital Bank’s highly differentiated
commercial and private banking relationships, while Chartwell
Investment Partners continues to attract new AUM and enhance
profitability --
TriState Capital Holdings, Inc. (Nasdaq: TSC) reported second
quarter 2021 financial results including fully organic growth in
all of its investment management, private banking and commercial
banking businesses, as assets under management (AUM), loans, net
interest income, fee income, revenue, pre-tax income and net income
reach new record high levels.
The parent company of TriState Capital Bank and Chartwell
Investment Partners grew net income available to common
shareholders to $15.7 million in the second quarter of 2021, up
86.1% from $8.4 million in the second quarter of 2020 and up 19.5%
from $13.1 million in the first quarter of 2021. Income before tax
was a record $23.2 million in the second quarter of 2021,
increasing 87.7% from $12.4 million in the second quarter of 2020
and 11.7% from $20.8 million in the linked quarter.
The company earned $0.41 per diluted share in the second quarter
of 2021, compared to $0.30 in the second quarter of 2020 and $0.35
in the first quarter of 2021. Second quarter 2021 results include a
higher number of diluted average shares outstanding and a $1.1
million increase in preferred dividends, compared to the year-ago
quarter, both resulting from the company’s December 30, 2020
private placement of $105 million of common stock, convertible
preferred stock and warrants.
“TriState Capital’s strong top- and bottom-line performance
during the second quarter reflects the value of our premier
relationships and the power of our company with more than $23
billion of on-balance-sheet assets and client assets under
management,” Chairman and Chief Executive Officer James F. Getz
said. “Our three business lines worked in concert to drive
continued growth in total revenue, pre-tax income and net income
during the second quarter. Building on its breakout performance in
the first quarter, Chartwell grew AUM to a new record of $11.51
billion, while delivering very strong revenue growth. Private
banking was a primary driver of strong organic loan growth to $9.28
billion at TriState Capital Bank, complemented by commercial
lending with our middle-market clients, further enhancing what we
believe is a very attractive risk profile for the company and its
balance sheet. As we enter the second half of 2021, we do so from a
position of strength, supported by healthy new business pipelines,
an agile funding franchise, a highly motivated team and
relationships with exceptional clients nationwide.”
SECOND QUARTER 2021 HIGHLIGHTS
- Chartwell’s investment management business continued its strong
performance and grew AUM organically to a record $11.51 billion, up
24.4% from June 30, 2020 and 2.7% during the quarter and its fees
increased 22.1% from the year-ago quarter and 5.0% from the linked
quarter.
- Chartwell’s retail and institutional distribution capability
generated year-to-date net inflows of $533.0 million, while
enhanced profitability supported product development including a
new short duration high-grade fixed income fund to complement its
Short Duration BB High Yield strategy.
- Return on average common equity expanded to 10.37%, up 375
basis points from the year-ago period and 131 basis points from the
linked quarter, as the company continues to productively deploy
capital raised in December 2020.
- Net interest income (NII) grew to a record $42.9 million, up
28.2% from the year-ago quarter and 11.0% from the linked quarter,
on historic loan growth and continued net interest margin (NIM)
expansion to 1.63%.
- Period-end loans grew organically to a record $9.28 billion, up
29.5% from June 30, 2020 and 8.7%, during the quarter.
- Private banking loans primarily collateralized by marketable
securities and other liquid assets represented 61.5% of total loans
at period end, growing 40.6% from June 30, 2020 and 13.1% during
the quarter, while commercial loans increased by 14.9% from June
30, 2020 and 2.3% during the quarter.
- The company maintained superior credit quality metrics, with
period-end non-performing assets (NPAs), non-performing loans
(NPLs), and adverse-rated credits declining by 46.0%, 50.8% and
33.0%, respectively, from March 31, 2021.
REVENUE GROWTH
NII grew to a record $42.9 million in the second quarter of
2021, increasing 28.2% from $33.5 million in the year-ago quarter
and 11.0% from $38.7 million in the first quarter of 2021. NIM
expanded for the third consecutive quarter to 1.63% for the three
months ended June 30, 2021, up from 1.52% in the second quarter of
2020 and 1.59% in the first quarter of 2021.
Non-interest income grew to a record $14.8 million in the second
quarter of 2021, up 14.2% from $13.0 million in the year-ago
quarter and 8.7% from $13.7 million in the linked quarter.
Chartwell investment management fees grew to $9.5 million in the
second quarter of 2021, up 22.1% from $7.7 million in the same
period the prior year and 5.0% from $9.0 million in the linked
quarter, reflecting market appreciation and positive net inflows of
client assets. Fees from commercial and private banking clients’
use of TriState Capital’s interest rate swaps offering totaled $3.9
million in the second quarter of 2021, $3.9 million in the prior
year quarter and $2.7 million in the linked quarter.
NII and non-interest income, excluding net gains and losses on
the sale of debt securities, combined to generate record total
revenue of $57.7 million for the second quarter of 2021, an
increase of 24.1% from $46.5 million in the year-ago period and
10.2% from $52.3 million in the linked quarter. Total revenue,
which is not a financial metric under generally accepted accounting
principles (GAAP), is a measure that TriState Capital has
consistently utilized to provide a greater understanding of the
diversity and balance of its income-generating capabilities.
Non-interest income represented 25.6% of total revenue in the
second quarter of 2021 when excluding net gains on the sale of
securities, compared to 27.9% from the year-ago period and 26.1%
from the linked quarter.
EXPENSES IN LINE WITH EXPECTATIONS
TriState Capital continues to invest in talent, technology,
products and risk and compliance management to support the
continued responsible growth of its businesses and balance sheet,
to provide a premier client experience, and to scale its efficient
branchless operating model.
Second quarter 2021 non-interest expense of $34.4 million was
in-line with the company’s expectations, increasing 22.5% from
$28.1 million in the year-ago period and increasing 10.1% from
$31.3 million in the linked quarter. Non-interest expense for the
first half of 2021 was $65.7 million, up 14.8% from the first half
of 2020. TriState Capital continues to maintain its goal of annual
operating expense growth of 10% to 12% for full-year 2021.
Operating expenses continue to be favorably impacted by what are
expected to be sustainable reductions in annual Federal Deposit
Insurance Corporation (FDIC) insurance expense as a percentage of
average assets, as compared to prior years. FDIC insurance expense
was $1.1 million in the second quarter of 2021, or an annualized
0.04% of average assets, compared to $2.6 million, or 0.11%, in the
same period the prior year, and $1.1 million, or 0.04%, in the
linked quarter.
TriState Capital Bank’s efficiency ratio for the second quarter
of 2021 was 51.51%, compared to 50.39% in the second quarter of
2020 and 50.59% in the linked quarter. Efficiency ratio is a
non-GAAP financial metric utilized to provide a greater
understanding of a bank’s level of non-interest expense as a
percentage of total revenue.
TriState Capital continued to maintain a low annualized
non-interest expense to average assets ratio of 1.27% in the second
quarter of 2021, compared to 1.22% in the second quarter of 2020
and 1.24% in the linked quarter.
Pre-tax, pre-provision net revenue grew to a record $23.2
million in the second quarter of 2021, increasing 26.5% from $18.4
million in the year-ago period and 10.5% from $21.0 million in the
linked quarter. Pre-tax, pre-provision net revenue is a non-GAAP
financial metric representing net income, without giving effect to
loan loss provision and income taxes, and excluding gains and
losses on the sale and call of investment securities.
TriState Capital’s effective tax rate was 19.2% for the second
quarter of 2021. The company’s effective tax rate is impacted by
certain factors including the number, timing and size of tax credit
investments, as well as the proportion of consolidated earnings
attributed to investment management. The company’s 2021 effective
tax rate, based on factors including anticipated tax credit
investment opportunities, is currently expected to be in the high
teens.
Net income available to common shareholders and earnings per
share in the second quarter of 2021 are net of $3.1 million in
dividends payable to holders of the company’s Series A, Series B
and Series C Non-Cumulative Perpetual Preferred Stock.
INVESTMENT MANAGEMENT
A combination of investment performance, strong client
relationships and a robust new business effort contributed to
positive net inflows of $27.0 million for the three months ending
June 30, 2021. In addition, Chartwell’s new business pipeline
currently has in excess of $65 million in commitments from
institutional investors.
Chartwell’s new business and new flows from existing accounts of
$458.0 million and market appreciation of $281.0 million more than
offset outflows of $431.0 million in the second quarter of 2021.
Chartwell’s assets under management grew to $11.51 billion at June
30, 2021, increasing 24.4% from $9.25 billion on June 30, 2020 and
2.7% from $11.20 billion on March 31, 2021.
Annual run-rate revenue grew to $39.9 million as of June 30,
2021, increasing 2.7% from March 31, 2021. Chartwell’s weighted
average fee rate was 0.35% at June 30, 2021. Investment management
fee revenue was $9.5 million in the second quarter of 2021,
compared to $7.7 million in the second quarter of 2020 and $9.0
million in the first quarter of 2021.
Initiatives to enhance Chartwell profitability continue to be
reflected in the segment’s improving level of expenses relative to
revenue. Chartwell segment expenses were $8.3 million in the second
quarter of 2021, compared to $7.5 million in the second quarter of
2020 and $7.9 million in the first quarter of 2021.
ORGANIC LENDING FRANCHISE GROWTH
TriState Capital’s client engagement and distribution
capabilities continued to drive the organic growth of both sides of
its balance sheet by expanding the number and depth of its premier
relationships with high-quality middle-market commercial customers,
as well as expanding the number of high-net-worth clients the bank
serves through its growing national referral network of financial
intermediaries.
Average loans totaled a record $8.81 billion in the second
quarter of 2021, growing 24.2% from $7.09 billion in the prior year
period and 6.4% from $8.28 billion in the linked quarter.
Period-end loans totaled a record $9.28 billion on June 30, 2021,
growing $2.11 billion, or 29.5%, from June 30, 2020, and $739.7
million, or 8.7%, from March 31, 2021.
TriState Capital continued to fortify its position as the
nation’s leading independent provider of marketable
securities-backed loans for clients of independent investment
advisory firms, trust companies, broker-dealers, regional
securities firms, family offices, insurance companies and other
financial intermediaries that do not offer banking services
themselves. Private banking loans totaled a record $5.71 billion at
June 30, 2021, increasing $1.65 billion, or 40.6%, from one year
prior and $659.9 million, or 13.1%, from the end of the linked
quarter.
The company continued to grow relationships with top-quality
middle-market sponsors and businesses, driving originations of
commercial and industrial (C&I) and commercial real estate
(CRE) loans while managing credit quality within the portfolio.
Commercial loans totaled $3.57 billion at June 30, 2021, increasing
$461.7 million, or 14.9%, from one year prior and $79.8 million, or
2.3%, from the end of the linked quarter.
C&I loans grew to $1.24 billion at June 30, 2021, increasing
$88.0 million, or 7.6%, from one year prior. C&I loans
decreased $8.3 million, or 0.7%, from March 31, 2021, as new loan
originations, draws and equipment finance production were offset by
amortization and paydowns. The bank did not participate in the
Paycheck Protection Program (PPP).
CRE loans grew to $2.33 billion at June 30, 2021, increasing
$373.7 million, or 19.1%, from one year prior and $88.1 million, or
3.9%, from the end of the linked quarter.
STRATEGIC DEPOSIT AND LIQUIDITY MANAGEMENT FRANCHISE
EXPANSION
TriState Capital continues to deliver growth on its agile
liquidity management franchise, which creates meaningful
service-based client relationships and provides highly responsive
funding. The bank is winning new business and enhancing the breadth
and depth of existing client relationships with its nationally
distributed service and liquidity management offerings for
financial services businesses, payroll and other specialized
payment servicers, real estate firms, high-net-worth individuals,
family offices, middle market companies, municipalities and
non-profits.
Average deposits totaled a record $9.56 billion in the second
quarter of 2021, growing 19.5% from $8.00 billion in the second
quarter of last year and 8.0% from $8.85 billion in the linked
quarter. Period-end deposits totaled a record $10.19 billion at
June 30, 2021, growing $2.36 billion, or 30.1%, from June 30, 2020,
and $941.4 million, or 10.2%, from March 31, 2021.
Treasury management deposit accounts totaled $2.27 billion at
June 30, 2021, increasing $1.14 billion, or 101.9%, from June 30,
2020 and $450.1 million, or 24.8%, from March 31, 2021.
The bank’s loan-to-deposit ratio at June 30, 2021 was 91.09%,
compared to 91.56% at June 30, 2020 and 92.36% at March 31, 2021,
reflecting the bank’s differentiated ability to manage liquidity
levels in line with deployment opportunities.
INTEREST RATE MANAGEMENT
TriState Capital continues to maintain a balance sheet with
significant flexibility to manage interest rate dynamics, while
offering attractive deposit and loan pricing to clients.
Ultimately, the bank continues to favor an asset-neutral to
asset-sensitive approach over the long term.
Investment securities totaled a record $1.34 billion at June 30,
2021, up 64.7% from June 30, 2020 and 8.7% from March 31, 2021 as
the bank continued to build on-balance sheet liquidity.
Approximately 60% of TriState Capital’s non-fixed rate deposits
use the Effective Fed Funds Rate or another benchmark as reference
points, and the remaining non-fixed rate deposits are priced at
rates set with bank discretion. Total cost of funds for all
deposits and interest-bearing liabilities averaged 0.51% during the
second quarter of 2021, compared to 0.87% in the same period last
year and 0.59% in the linked quarter. The total cost of deposits
averaged 0.42% during the second quarter of 2021, compared to 0.80%
in the same period last year and 0.49% in the linked quarter.
At June 30, 2021, 94% of the bank’s loans were floating rate and
indexed to 30-day LIBOR or the Prime Rate. TriState Capital
continued to constructively use interest rate floors on existing
and new variable rate loans throughout the second quarter of
2021.
The yield on total loans averaged 2.35% during the second
quarter of 2021, compared to 2.69% in the prior year period and
2.41% in the linked quarter. Loan yields resulted primarily from
trends in 30-day LIBOR which declined on average approximately 2
basis points during the second quarter of 2021. Loan yields were
also affected by higher rates of growth in balances of private bank
loans relative to commercial bank loans. Loan yield movement was
offset by a continued reduction in deposit costs.
ASSET QUALITY
TriState Capital maintained strong asset quality metrics in the
second quarter of 2021, reflecting its disciplined credit culture
and lower risk profile resulting from the majority of its loans
consisting of private banking non-purpose margin loans
collateralized by marketable securities. Private banking grew to
represent 61.5% of the total loan portfolio at June 30, 2021, while
CRE and C&I comprised 25.1% and 13.4% of total loans,
respectively.
COVID-19 deferral levels continued to decline in line with
expectations to four loans representing $41.0 million or 0.4% of
total loans on June 30, 2021, from eight loans representing $62.1
million or 0.7% of total loans on March 31, 2021.
The allowance for credit losses on loans and leases (ACL) was
$32.6 million at June 30, 2021, compared to $23.3 million at June
30, 2020 and $34.6 million at March 31, 2021. ACL represented 0.91%
of commercial loans at period end, excluding private banking loans
primarily collateralized by liquid, marketable securities that do
not require a reserve, compared to 0.75% at June 30, 2020 and 0.99%
at March 31, 2021. As a percentage of total loans, ACL was 0.35% at
June 30, 2021, 0.32% at June 30, 2020 and 0.41% at March 31,
2021.
TriState Capital’s net charge offs (NCOs) were $2.3 million in
the second quarter of 2021, or 0.10% of total average loans of
$8.81 billion. NCOs were $33,000 in the year-ago quarter and
$199,000 in the linked quarter.
During the second quarter of 2021, NPAs, NPLs, and adverse-rated
credits declined by 46.0%, 50.8% and 33.0%, respectively, from
March 31, 2021 to June 30, 2021.
NPAs were $13.7 million, or 0.12% of total assets, at June 30,
2021, compared to $9.5 million, or 0.10%, at June 30, 2020 and
$25.5 million, or 0.24%, at March 31, 2021. NPLs were $11.2
million, or 0.12% of total loans, at June 30, 2021, compared to
$6.8 million, or 0.09%, at June 30, 2020 and $22.7 million, or
0.27%, at March 31, 2021.
Total adverse-rated credits, including NPLs, were $34.1 million,
or 0.37% of total loans, at June 30, 2021, compared to $33.0
million, or 0.46%, at June 30, 2020 and $50.9 million, or 0.60%, at
March 31, 2021.
TriState Capital recorded provision expense of $96,000 in the
second quarter of 2021, $6.0 million in the second quarter of 2020
and $224,000 in the linked quarter.
CAPITAL STRENGTH AND EFFICIENCY
The company’s strong balance sheet included $1.87 billion in
cash, equivalents and securities at June 30, 2021. Cash,
equivalents, securities and private banking loans -- which are
primarily collateralized by marketable securities that are
monitored daily, liquid and subject to favorable treatment under
regulatory capital requirements -- represented 65.68% of total
assets at the end of the second quarter of 2021.
As of June 30, 2021, estimated regulatory capital ratios for
TriState Capital Holdings were 13.94% for total risk-based capital,
11.94% for tier 1 risk-based capital, 9.06% for common equity tier
1 risk-based capital, and 6.86% for tier 1 leverage, reflecting the
historic level of asset growth in the second quarter of 2021. For
TriState Capital Bank, the estimated capital ratios were 13.26% for
total risk-based capital, 12.80% for tier 1 risk-based capital,
12.80% for common equity tier 1 risk-based capital, and 7.34% for
tier 1 leverage.
The company’s common shareholders equity to total assets was
5.3% on June 30, 2021. The ratio of common shareholders’ equity
excluding intangible assets, or tangible common equity (TCE), to
total assets excluding intangible assets was 4.81% on June 30,
2021. The TCE ratio was 9.58% excluding private banking loans
primarily collateralized by liquid, marketable securities on June
30, 2021. The TCE ratio and TCE ratio excluding private banking
loans are non-GAAP metrics utilized to provide a greater
understanding of the capital adequacy of financial services
companies.
TriState Capital had $9.8 million of common stock repurchase
authority available at June 30, 2021 under previously disclosed
buyback programs authorized by its Board of Directors. Since the
Board first authorized share buybacks in 2014, the company has
repurchased a total of 2.1 million shares for approximately $33.0
million at an average cost of $15.39 per share. The company has not
repurchased shares on the open market since the second quarter of
2020.
CONFERENCE CALL
As previously announced, TriState Capital will hold a conference
call tomorrow to review its financial results and operating
performance.
The live conference call on July 22 will be held at 8:30 a.m.
ET. Telephone participants may avoid any delays by pre-registering
for the call using the link
https://dpregister.com/sreg/10157838/e9f425b8be to receive a
special dial-in number and PIN. Telephone participants who are
unable to pre-register should dial in at least 10 minutes prior to
the call and request the “TriState Capital investor call.” The call
may be accessed by dialing 888-339-0757 from the United States or
Canada, and 412-902-4194 from other international locations.
The live conference call will also be available through an audio
webcast accessible at
https://services.choruscall.com/links/tsc210722.html or
https://investors.tristatecapitalbank.com. These links may also be
used to access an archived replay of the conference call.
A telephone replay of the call will be available approximately
one hour after the end of the conference through July 29. The
replay may be accessed by dialing 877-344-7529 from the United
States, 855-669-9658 from Canada, or 412-317-0088 from other
international locations, and entering the conference number
10157838.
ABOUT TRISTATE CAPITAL
TriState Capital Holdings, Inc. (Nasdaq: TSC) is a bank holding
company headquartered in Pittsburgh, Pa., providing commercial
banking, private banking and investment management services to
middle-market companies, institutional clients and high-net-worth
individuals. Its TriState Capital Bank subsidiary had $11.46
billion in assets as of June 30, 2021, and serves middle-market
commercial customers through regional representative offices in
Pittsburgh, Philadelphia, Cleveland, Edison, N.J., and New York
City, as well as high-net-worth individuals nationwide through its
national referral network of financial intermediaries. Its
Chartwell Investment Partners subsidiary had $11.51 billion in
assets under management as of June 30, 2021, and serves
institutional clients and TriState Capital’s financial intermediary
network. For more information, please visit
http://investors.tristatecapitalbank.com.
FORWARD-LOOKING STATEMENTS
This news release contains “forward-looking statements” within
the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. These forward-looking statements reflect TriState
Capital’s current views with respect to, among other things, future
events and the company’s financial performance, as well as the
company’s goals and objectives for future operations, financial and
business trends, business prospects and management’s outlook or
expectations for earnings, revenues, expenses, capital levels,
liquidity levels, asset quality or other measures of future
financial or business performance, strategies or expectations.
These statements are often, but not always, made through the use of
words or phrases such as “achieve,” “anticipate,” “believe,”
“continue,” “could,” “estimate,” “expect,” “goal,” “intend,”
“maintain,” “may,” “opportunity,” “outlook,” “plan,” “potential,”
“predict,” “projection,” “seek,” “should,” “sustain,” “target,”
“trend,” “will,” “will likely result,” and “would,” or the negative
versions of those words or other comparable statements of a future
or forward-looking nature. These forward-looking statements are not
historical facts, and are based on current expectations, estimates
and projections about TriState Capital’s industry and beliefs or
assumptions made by management, many of which, by their nature, are
inherently uncertain. Although TriState Capital believes that the
expectations reflected in these forward-looking statements are
reasonable as of the date made, actual results may prove to be
materially different from the results expressed or implied by the
forward-looking statements. Accordingly, TriState Capital cautions
you that any such forward-looking statements are not guarantees of
future performance and are subject to risks, assumptions and
uncertainties that change over time and are difficult to predict,
including, but not limited to, the following:
- risks associated with the COVID-19 pandemic and their expected
impact and duration, including effects on TriState Capital’s
operations, its clients, economic conditions and the demand for its
products and services;
- TriState Capital’s ability to prudently manage its growth and
execute its strategy, including the successful integration of past
and future acquisitions, its ability to fully realize the cost
savings and other benefits of its acquisitions, manage risks
related to business disruption following those acquisitions, and
manage customer disintermediation;
- deterioration of TriState Capital’s asset quality;
- TriState Capital’s level of non-performing assets and the costs
associated with resolving problem loans, including litigation and
other costs;
- possible additional loan and lease losses and impairment,
changes in the value of collateral securing TriState Capital’s
loans and leases and the collectability of loans and leases,
particularly as a result of the COVID-19 pandemic and the programs
implemented by the Coronavirus Aid, Relief, and Economic Security
Act, including its automatic loan forbearance provisions;
- possible changes in the speed of loan prepayments by customers
and loan origination or sales volumes;
- business and economic conditions generally and in the financial
services industry, nationally and within TriState Capital’s local
market areas, including the effects of an increase in unemployment
levels, slowdowns in economic growth and changes in demand for
products or services or the value of assets under management;
- TriState Capital’s ability to maintain important deposit
customer relationships, its reputation and otherwise avoid
liquidity risks;
- changes in management personnel;
- TriState Capital’s ability to recruit and retain key
employees;
- volatility and direction of interest rates;
- risks related to the phasing out of LIBOR and changes in the
manner of calculating reference rates, as well as the impact of the
phase out of LIBOR and introduction of alternative reference rates
on the value of loans and other financial instruments we hold that
are linked to LIBOR;
- changes in accounting policies, accounting standards, or
authoritative accounting guidance, including the CECL model;
- any impairment of TriState Capital’s goodwill or other
intangible assets;
- TriState Capital’s ability to develop and provide competitive
products and services that appeal to its customers and target
markets;
- TriState Capital’s ability to provide investment management
performance competitive with its peers and benchmarks;
- fluctuations in the carrying value of the assets under
management held by Chartwell Investment Partners, LLC, the
company’s registered investment advisor subsidiary, as well as the
relative and absolute investment performance of such subsidiary’s
investment products;
- operational risks associated with TriState Capital’s business,
including technology and cyber-security related risks;
- increased competition in the financial services industry,
particularly from regional and national institutions;
- negative perceptions or publicity with respect to any products
or services offered by TriState Capital;
- adverse judgments or other resolution of pending and future
legal proceedings, and costs incurred in defending such
proceedings;
- changes in the laws, rules, regulations, interpretations or
policies relating to financial institutions, accounting, tax,
trade, monetary and fiscal matters, including economic stimulus
programs, and potential expenses associated with complying with
such laws and regulations;
- TriState Capital’s ability to comply with applicable capital
and liquidity requirements, including its ability to generate
liquidity internally or raise capital on favorable terms;
- regulatory limits on TriState Capital’s ability to receive
dividends from its subsidiaries and pay dividends to
shareholders;
- changes and direction of government policy towards and
intervention in the U.S. financial system;
- natural disasters and adverse weather, acts of terrorism,
regional or national civil unrest, cyber-attacks, an outbreak of
hostilities, a public health outbreak (such as COVID-19) or other
international or domestic calamities, and other matters beyond
TriState Capital’s control;
- the effects of any reputation, credit, interest rate, market,
operational, legal, liquidity, regulatory or compliance risk
resulting from developments related to any of the risks discussed
above; and
- other factors that are discussed in TriState Capital’s filings
with the Securities and Exchange Commission.
The foregoing factors should not be construed as exhaustive and
should be read together with the other cautionary statements
included in this press release. If one or more events related to
these or other risks or uncertainties materialize, or if TriState
Capital’s underlying assumptions prove to be incorrect, actual
results may differ materially from what the company anticipates.
Accordingly, readers should not place undue reliance on any such
forward-looking statements. New factors emerge from time to time,
and it is not possible for TriState Capital to predict which will
arise. Any forward-looking statement speaks only as of the date on
which it is made, and TriState Capital does not undertake any
obligation to update or review any forward-looking statement,
whether as a result of new information, future developments or
otherwise. In addition, TriState Capital cannot assess the impact
of each factor on its business or the extent to which any factor,
or combination of factors, may cause actual results to differ
materially from those contained in any forward-looking
statements.
NON-GAAP FINANCIAL DISCLOSURES
This news release and the accompanying tables contain certain
financial information determined by methods other than in
accordance with U.S. generally accepted accounting principles
(GAAP). Specifically, TriState Capital reviews and reports tangible
common equity, tangible book value per common share, tangible
assets, tangible assets excluding private banking loans, tangible
common equity ratio, tangible common equity ratio excluding private
banking loans, EBITDA, total revenue, pre-tax, pre-provision net
revenue and efficiency ratio. Although TriState Capital believes
these non-GAAP financial measures provide a greater understanding
of its business, these measures are not necessarily comparable to
similar measures that may be presented by other companies. These
disclosures should not be viewed as a substitute for financial
measures determined in accordance with GAAP. Where non-GAAP
disclosures are used, the most directly comparable GAAP financial
measure, as well as the reconciliation to the comparable GAAP
financial measure, can be found within this news release and in the
reconciliation tables accompanying this news release.
TRISTATE CAPITAL HOLDINGS, INC.
BALANCE SHEET DATA (UNAUDITED)
As of
June 30,
March 31,
June 30,
(Dollars in thousands)
2021
2021
2020
Cash and cash equivalents
$
529,453
$
446,484
$
724,942
Total investment securities
1,337,658
1,231,074
812,140
Loans and leases held-for-investment
9,282,922
8,543,182
7,170,770
Allowance for credit losses on loans and
leases
(32,577)
(34,644)
(23,276)
Loans and leases held-for-investment,
net
9,250,345
8,508,538
7,147,494
Goodwill and other intangibles, net
62,955
63,433
64,867
Other assets
360,761
315,621
380,398
Total assets
$
11,541,172
$
10,565,150
$
9,129,841
Deposits
$
10,191,433
$
9,250,019
$
7,831,471
Borrowings, net
345,600
345,547
395,552
Other liabilities
209,571
195,298
269,987
Total liabilities
10,746,604
9,790,864
8,497,010
Preferred stock
179,343
178,243
116,079
Common shareholders’ equity
615,225
596,043
516,752
Total shareholders’ equity
794,568
774,286
632,831
Total liabilities and shareholders’
equity
$
11,541,172
$
10,565,150
$
9,129,841
TRISTATE CAPITAL HOLDINGS, INC.
INCOME STATEMENT DATA
(UNAUDITED)
Three Months Ended
Six Months Ended
June 30,
March 31,
June 30,
June 30,
June 30,
(Dollars in thousands)
2021
2021
2020
2021
2020
Interest income:
Loans and leases
$
51,702
$
49,186
$
47,377
$
100,888
$
106,295
Investments
3,737
2,646
3,940
6,383
7,841
Interest-earning deposits
116
160
344
276
1,727
Total interest income
55,555
51,992
51,661
107,547
115,863
Interest expense:
Deposits
10,106
10,754
15,953
20,860
43,197
Borrowings
2,537
2,582
2,224
5,119
4,260
Total interest expense
12,643
13,336
18,177
25,979
47,457
Net interest income
42,912
38,656
33,484
81,568
68,406
Provision for credit losses
96
224
6,005
320
8,998
Net interest income after provision for
credit losses
42,816
38,432
27,479
81,248
59,408
Non-interest income:
Investment management fees
9,451
9,000
7,738
18,451
15,376
Service charges on deposits
325
316
315
641
528
Net gain (loss) on the sale and call of
debt securities
98
(1)
14
97
71
Swap fees
3,913
2,711
3,853
6,624
8,226
Commitment and other loan fees
564
326
462
890
881
Bank owned life insurance income
480
429
429
909
857
Other income
13
870
186
883
374
Total non-interest income
14,844
13,651
12,997
28,495
26,313
Non-interest expense:
Compensation and employee benefits
20,937
19,921
16,569
40,858
34,015
Premises and equipment expense
1,173
1,406
1,515
2,579
2,901
Professional fees
2,124
1,324
1,109
3,448
2,579
FDIC insurance expense
1,125
1,125
2,560
2,250
4,730
General insurance expense
341
298
278
639
540
State capital shares tax expense
777
650
366
1,427
749
Travel and entertainment expense
639
441
279
1,080
1,143
Technology and data services
3,687
3,100
2,414
6,787
4,717
Intangible amortization expense
478
478
486
956
988
Marketing and advertising
898
684
686
1,582
1,300
Other operating expenses
2,246
1,851
1,834
4,097
3,578
Total non-interest expense
34,425
31,278
28,096
65,703
57,240
Income before tax
23,235
20,805
12,380
44,040
28,481
Income tax expense
4,455
4,605
1,979
9,060
5,185
Net income
$
18,780
$
16,200
$
10,401
$
34,980
$
23,296
Preferred stock dividends
3,077
3,059
1,962
6,136
3,924
Net income available to common
shareholders
$
15,703
$
13,141
$
8,439
$
28,844
$
19,372
TRISTATE CAPITAL HOLDINGS, INC.
SELECTED FINANCIAL HIGHLIGHTS
(UNAUDITED)
As of and For the
Three Months Ended
As of and For the
Six Months Ended
June 30,
March 31,
June 30,
June 30,
June 30,
(Dollars in thousands, except per share
data)
2021
2021
2020
2021
2020
Per share and share data:
Earnings per common share:
Basic
$
0.42
$
0.36
$
0.30
$
0.78
$
0.69
Diluted
$
0.41
$
0.35
$
0.30
$
0.76
$
0.68
Book value per common share
$
18.54
$
17.97
$
17.31
$
18.54
$
17.31
Tangible book value per common share
(1)
$
16.65
$
16.06
$
15.14
$
16.65
$
15.14
Common shares outstanding, at end of
period
33,176,934
33,160,605
29,851,550
33,176,934
29,851,550
Weighted average common shares
outstanding:
Basic
31,280,481
31,224,474
28,223,085
31,252,632
28,201,837
Diluted
32,147,758
32,187,034
28,527,961
32,278,282
28,687,804
Performance ratios:
Return on average assets (2)
0.69
%
0.64
%
0.45
%
0.67
%
0.54
%
Return on average common equity (2)
10.37
%
9.06
%
6.62
%
9.73
%
7.60
%
Net interest margin (2) (3)
1.63
%
1.59
%
1.52
%
1.61
%
1.67
%
Total revenue (1)
$
57,658
$
52,308
$
46,467
$
109,966
$
94,648
Pre-tax, pre-provision net revenue (1)
$
23,233
$
21,030
$
18,371
$
44,263
$
37,408
Bank efficiency ratio (1)
51.51
%
50.59
%
50.39
%
51.07
%
51.13
%
Non-interest expense to average assets
(2)
1.27
%
1.24
%
1.22
%
1.26
%
1.34
%
Asset quality:
Non-performing loans
$
11,175
$
22,727
$
6,780
$
11,175
$
6,780
Non-performing assets
$
13,743
$
25,451
$
9,504
$
13,743
$
9,504
Other real estate owned
$
2,568
$
2,724
$
2,724
$
2,568
$
2,724
Non-performing assets to total assets
0.12
%
0.24
%
0.10
%
0.12
%
0.10
%
Non-performing loans to total loans
0.12
%
0.27
%
0.09
%
0.12
%
0.09
%
ACL to loans and leases
0.35
%
0.41
%
0.32
%
0.35
%
0.32
%
ACL to non-performing loans
291.52
%
152.44
%
343.30
%
291.52
%
343.30
%
Net charge-offs (recoveries)
$
2,253
$
199
$
33
$
2,452
$
(170)
Net charge-offs (recoveries) to average
total loans (2)
0.10
%
0.01
%
—
%
0.06
%
—
%
Capital ratios: (4)
Tier 1 leverage ratio
6.86
%
7.13
%
6.30
%
6.86
%
6.30
%
Common equity tier 1 risk-based capital
ratio
9.06
%
9.10
%
8.54
%
9.06
%
8.54
%
Tier 1 risk-based capital ratio
11.94
%
12.08
%
10.68
%
11.94
%
10.68
%
Total risk-based capital ratio
13.94
%
14.18
%
12.89
%
13.94
%
12.89
%
Bank tier 1 leverage ratio
7.34
%
7.65
%
7.11
%
7.34
%
7.11
%
Bank common equity tier 1 risk-based
capital ratio
12.80
%
12.98
%
12.07
%
12.80
%
12.07
%
Bank tier 1 risk based capital ratio
12.80
%
12.98
%
12.07
%
12.80
%
12.07
%
Bank total risk-based capital ratio
13.26
%
13.49
%
12.52
%
13.26
%
12.52
%
Investment Management Segment:
Assets under management
$
11,511,000
$
11,203,000
$
9,254,000
$
11,511,000
$
9,254,000
EBITDA (1)
$
2,063
$
1,916
$
1,031
$
3,979
$
2,248
(1)
These measures are not measures recognized
under GAAP and are therefore considered to be non-GAAP financial
measures. See “Non-GAAP Financial Measures” for a reconciliation of
these measures to their most directly comparable GAAP measures.
(2)
Ratios are annualized.
(3)
Net interest margin is calculated on a
fully taxable equivalent basis.
(4)
Capital ratios are estimated until
regulatory reports are filed.
TRISTATE CAPITAL HOLDINGS, INC.
AVERAGES AND YIELDS (UNAUDITED)
Three Months Ended
June 30, 2021
March 31, 2021
June 30, 2020
(Dollars in thousands)
Average Balance
Interest Income (1)/ Expense
Average Yield/ Rate (2)
Average Balance
Interest Income (1)/ Expense
Average Yield/ Rate (2)
Average Balance
Interest Income (1)/ Expense
Average Yield/ Rate (2)
Assets
Interest-earning deposits
$
407,627
$
114
0.11
%
$
555,427
$
158
0.12
%
$
1,098,510
$
342
0.13
%
Federal funds sold
11,502
2
0.07
%
10,557
2
0.08
%
7,883
1
0.05
%
Debt securities available-for-sale
266,264
886
1.33
%
348,835
570
0.66
%
329,015
2,026
2.48
%
Debt securities held-to-maturity
1,040,658
2,705
1.04
%
637,719
1,900
1.21
%
292,898
1,616
2.22
%
Debt securities trading
—
—
—
%
315
1
1.29
%
—
—
—
%
FHLB stock
11,776
154
5.25
%
11,551
182
6.39
%
13,269
305
9.24
%
Total loans and leases
8,808,775
51,702
2.35
%
8,276,059
49,186
2.41
%
7,094,744
47,377
2.69
%
Total interest-earning assets
10,546,602
55,563
2.11
%
9,840,463
51,999
2.14
%
8,836,319
51,667
2.35
%
Other assets
347,923
375,418
408,950
Total assets
$
10,894,525
$
10,215,881
$
9,245,269
Liabilities and Shareholders’
Equity
Interest-bearing deposits:
Interest-bearing checking accounts
$
3,852,078
$
3,214
0.33
%
$
3,065,983
$
2,793
0.37
%
$
2,327,513
$
2,719
0.47
%
Money market deposit accounts
4,316,946
5,636
0.52
%
4,345,454
5,964
0.56
%
3,862,068
7,377
0.77
%
Certificates of deposit
929,906
1,256
0.54
%
1,012,861
1,997
0.80
%
1,389,984
5,857
1.69
%
Borrowings:
FHLB borrowings
250,000
1,082
1.74
%
253,889
1,072
1.71
%
300,000
1,284
1.72
%
Line of credit borrowings
—
—
—
%
4,589
55
4.86
%
22,747
260
4.60
%
Subordinated notes payable, net
95,565
1,455
6.11
%
95,511
1,455
6.18
%
44,417
680
6.16
%
Total interest-bearing liabilities
9,444,495
12,643
0.54
%
8,778,287
13,336
0.62
%
7,946,729
18,177
0.92
%
Noninterest-bearing deposits
460,601
424,535
417,732
Other liabilities
203,033
247,659
252,303
Shareholders’ equity
786,396
765,400
628,505
Total liabilities and shareholders’
equity
$
10,894,525
$
10,215,881
$
9,245,269
Net interest income (1)
$
42,920
$
38,663
$
33,490
Net interest spread (1)
1.57
%
1.52
%
1.43
%
Net interest margin (1)
1.63
%
1.59
%
1.52
%
(1)
Calculated on a fully taxable equivalent
basis.
(2)
Annualized.
TRISTATE CAPITAL HOLDINGS, INC.
AVERAGES AND YIELDS (UNAUDITED)
Six Months Ended June 30,
2021
2020
(Dollars in thousands)
Average Balance
Interest Income (1)/ Expense
Average Yield/ Rate (2)
Average Balance
Interest Income (1)/ Expense
Average Yield/ Rate (2)
Assets
Interest-earning deposits
$
481,119
$
272
0.11
%
$
781,406
$
1,705
0.44
%
Federal funds sold
11,032
4
0.07
%
7,491
21
0.56
%
Debt securities available-for-sale
307,322
1,456
0.96
%
305,442
4,070
2.68
%
Debt securities held-to-maturity
840,302
4,605
1.11
%
247,326
3,104
2.52
%
Debt securities trading
156
1
1.29
%
115
1
1.75
%
FHLB stock
11,664
336
5.81
%
16,724
703
8.45
%
Total loans and leases
8,543,889
100,888
2.38
%
6,883,718
106,295
3.11
%
Total interest-earning assets
10,195,484
107,562
2.13
%
8,242,222
115,899
2.83
%
Other assets
361,594
360,699
Total assets
$
10,557,078
$
8,602,921
Liabilities and Shareholders’
Equity
Interest-bearing deposits:
Interest-bearing checking accounts
$
3,461,202
$
6,007
0.35
%
$
1,900,563
$
7,933
0.84
%
Money market deposit accounts
4,331,121
11,600
0.54
%
3,705,517
22,031
1.20
%
Certificates of deposit
971,155
3,252
0.68
%
1,386,510
13,233
1.92
%
Borrowings:
FHLB borrowings
251,933
2,154
1.72
%
360,962
3,319
1.85
%
Line of credit borrowings
2,282
55
4.86
%
12,115
261
4.33
%
Subordinated notes payable, net
95,538
2,911
6.14
%
22,208
680
6.16
%
Total interest-bearing liabilities
9,113,231
25,979
0.57
%
7,387,875
47,457
1.29
%
Noninterest-bearing deposits
442,668
383,909
Other liabilities
225,223
202,755
Shareholders’ equity
775,956
628,382
Total liabilities and shareholders’
equity
$
10,557,078
$
8,602,921
Net interest income (1)
$
81,583
$
68,442
Net interest spread (1)
1.56
%
1.54
%
Net interest margin (1)
1.61
%
1.67
%
(1)
Interest income and net interest margin
are calculated on a fully taxable equivalent basis.
(2)
Annualized.
TRISTATE CAPITAL HOLDINGS, INC.
LOAN AND LEASE COMPOSITION
(UNAUDITED)
June 30, 2021
March 31, 2021
June 30, 2020
(Dollars in thousands)
Loan Balance
Percent of Total Loans
Loan Balance
Percent of Total Loans
Loan Balance
Percent of Total Loans
Private banking loans
$
5,713,562
61.5
%
$
5,053,621
59.2
%
$
4,063,116
56.6
%
Middle-market banking loans:
Commercial and industrial
1,240,917
13.4
%
1,249,208
14.6
%
1,152,880
16.1
%
Commercial real estate
2,328,443
25.1
%
2,240,353
26.2
%
1,954,774
27.3
%
Total middle-market banking loans
3,569,360
38.5
%
3,489,561
40.8
%
3,107,654
43.4
%
Loans and leases held-for-investment
$
9,282,922
100.0
%
$
8,543,182
100.0
%
$
7,170,770
100.0
%
TRISTATE CAPITAL HOLDINGS, INC.
STATEMENT OF INCOME BY REPORTABLE
SEGMENT (UNAUDITED)
Three Months Ended June 30,
2021
Three Months Ended June 30,
2020
(Dollars in thousands)
Bank
Investment Management
Parent and Other
Consolidated
Bank
Investment Management
Parent and Other
Consolidated
Income statement data:
Interest income
$
55,555
$
—
$
—
$
55,555
$
51,661
$
—
$
—
$
51,661
Interest expense
11,199
—
1,444
12,643
17,251
—
926
18,177
Net interest income (loss)
44,356
—
(1,444)
42,912
34,410
—
(926)
33,484
Provision for credit losses
96
—
—
96
6,005
—
—
6,005
Net interest income (loss) after provision
for credit losses
44,260
—
(1,444)
42,816
28,405
—
(926)
27,479
Non-interest income:
Investment management fees
—
9,774
(323)
9,451
—
7,897
(159)
7,738
Net gain on the sale and call of debt
securities
98
—
—
98
14
—
—
14
Other non-interest income
5,283
12
—
5,295
5,215
30
—
5,245
Total non-interest income (loss)
5,381
9,786
(323)
14,844
5,229
7,927
(159)
12,997
Non-interest expense:
Intangible amortization expense
—
478
—
478
—
486
—
486
Other non-interest expense
25,570
7,826
551
33,947
19,967
7,003
640
27,610
Total non-interest expense
25,570
8,304
551
34,425
19,967
7,489
640
28,096
Income (loss) before tax
24,071
1,482
(2,318)
23,235
13,667
438
(1,725)
12,380
Income tax expense (benefit)
4,565
286
(396)
4,455
2,173
102
(296)
1,979
Net income (loss)
$
19,506
$
1,196
$
(1,922)
$
18,780
$
11,494
$
336
$
(1,429)
$
10,401
Six Months Ended June 30,
2021
Six Months Ended June 30,
2020
(Dollars in thousands)
Bank
Investment Management
Parent and Other
Consolidated
Bank
Investment Management
Parent and Other
Consolidated
Income statement data:
Interest income
$
107,547
$
—
$
—
$
107,547
$
115,863
$
—
$
—
$
115,863
Interest expense
23,038
—
2,941
25,979
46,547
—
910
47,457
Net interest income (loss)
84,509
—
(2,941)
81,568
69,316
—
(910)
68,406
Provision for credit losses
320
—
—
320
8,998
—
—
8,998
Net interest income (loss) after provision
for credit losses
84,189
—
(2,941)
81,248
60,318
—
(910)
59,408
Non-interest income:
Investment management fees
—
19,009
(558)
18,451
—
15,662
(286)
15,376
Net gain on the sale and call of debt
securities
97
—
—
97
71
—
—
71
Other non-interest income
9,915
32
—
9,947
10,866
—
—
10,866
Total non-interest income (loss)
10,012
19,041
(558)
28,495
10,937
15,662
(286)
26,313
Non-interest expense:
Intangible amortization expense
—
956
—
956
—
988
—
988
Other non-interest expense
48,225
15,268
1,254
64,747
41,000
13,630
1,622
56,252
Total non-interest expense
48,225
16,224
1,254
65,703
41,000
14,618
1,622
57,240
Income (loss) before tax
45,976
2,817
(4,753)
44,040
30,255
1,044
(2,818)
28,481
Income tax expense (benefit)
9,294
596
(830)
9,060
5,521
130
(466)
5,185
Net income (loss)
$
36,682
$
2,221
$
(3,923)
$
34,980
$
24,734
$
914
$
(2,352)
$
23,296
TRISTATE CAPITAL HOLDINGS, INC.
EARNINGS PER COMMON SHARE
(UNAUDITED)
Three Months Ended
Years Ended
June 30,
March 31,
June 30,
June 30,
June 30,
(Dollars in thousands, except per share
data)
2021
2021
2020
2021
2020
Basic earnings per common
share:
Net income
$
18,780
$
16,200
$
10,401
$
34,980
$
23,296
Less: Preferred dividends on Series A and
Series B
1,962
1,962
1,962
3,924
3,924
Less: Preferred dividends on Series C
1,115
1,097
—
2,212
—
Net income available to common
shareholders
$
15,703
$
13,141
$
8,439
$
28,844
$
19,372
Allocation of net income available:
Common shareholders
$
13,272
$
11,127
$
8,439
$
24,375
$
19,372
Series C convertible preferred
shareholders
2,040
1,685
—
3,749
—
Warrant shareholders
391
329
—
720
—
Total
$
15,703
$
13,141
$
8,439
$
28,844
$
19,372
Basic weighted average common shares
outstanding:
Basic common shares
31,280,481
31,224,474
28,223,085
31,252,632
28,201,837
Series C convertible preferred stock,
as-if converted
4,807,272
4,727,272
—
4,807,272
—
Warrants, as-if exercised
922,438
922,438
—
922,438
—
Basic earnings per common share
$
0.42
$
0.36
$
0.30
$
0.78
$
0.69
Diluted earnings per common
share:
Income available to common shareholders
after allocation
$
13,272
$
11,127
$
8,439
$
24,375
$
19,372
Diluted weighted average common shares
outstanding:
Basic common shares
31,280,481
31,224,474
28,223,085
31,252,632
28,201,837
Restricted stock - dilutive
719,504
801,798
221,456
871,255
324,498
Stock options - dilutive
147,773
160,762
83,420
154,395
161,469
Diluted common shares
32,147,758
32,187,034
28,527,961
32,278,282
28,687,804
Diluted earnings per common share
$
0.41
$
0.35
$
0.30
$
0.76
$
0.68
June 30,
March 31,
June 30,
June 30,
June 30,
2021
2021
2020
2021
2020
Anti-dilutive shares:
Restricted stock
10,750
71,810
864,246
12,000
566,498
Stock options
—
—
5,500
—
—
Series C convertible preferred stock,
as-if converted
4,807,272
4,727,272
—
4,807,272
—
Warrants, as-if exercised
922,438
922,438
—
922,438
—
Total anti-dilutive shares
5,740,460
5,721,520
869,746
5,741,710
566,498
Earnings per common share (“EPS”) is computed using the
two-class method, which requires that the Series C convertible
preferred stock and warrants to be treated as participating classes
of securities in the computation of EPS. In addition, net income is
reduced by dividends declared on all series of preferred stock to
derive net income available to common shareholders. The two-class
method is an earnings allocation that determines EPS for each class
of common stock and participating security. Net income available to
common shareholders is reduced by the percentage of average common
shares allocable to Series C convertible preferred holders and
warrant holders on an as-if converted basis to arrive at net income
allocable to common shareholders. Basic EPS is computed by dividing
net income allocable to common shareholders by the weighted average
number of its common shares outstanding for the period, excluding
non-vested restricted stock. Diluted EPS reflects the potential
dilution upon the exercise of stock options and warrants, and the
vesting of restricted stock awards granted utilizing the treasury
stock method. The Series C convertible preferred stock is excluded
from diluted weighted average common shares outstanding because the
payment of the dividend is considered in the net income allocable
to common shareholders for the calculation of basic EPS.
TRISTATE CAPITAL HOLDINGS, INC. NON-GAAP FINANCIAL
MEASURES
The information set forth above contains certain financial
information determined by methods other than in accordance with
GAAP. These non-GAAP financial measures are “tangible common
equity,” “tangible book value per common share,” “tangible assets,”
“tangible assets excluding private banking loans,” tangible common
equity ratio,” “tangible common equity ratio excluding private
banking loans,” “EBITDA,” “total revenue,” “pre-tax, pre-provision
net revenue” and “efficiency ratio.” These non-GAAP financial
measures are supplemental measures that we believe provide
management and our investors with a more detailed understanding of
our performance, although these measures are not necessarily
comparable to similar measures that may be presented by other
companies. These disclosures should not be viewed as a substitute
for financial measures in accordance with GAAP. The non-GAAP
financial measures presented herein are calculated as follows:
“Tangible common equity” is defined as common shareholders’
equity reduced by intangible assets, including goodwill. We believe
this measure is important to management and investors so that they
can better understand and assess changes from period to period in
common shareholders’ equity exclusive of changes in intangible
assets associated with prior acquisitions. Intangible assets are
created when we buy businesses that add relationships and revenue
to our Company. Intangible assets have the effect of increasing
both equity and assets, while not increasing our tangible equity or
tangible assets.
“Tangible book value per common share” is defined as common
shareholders’ equity reduced by intangible assets, including
goodwill, divided by common shares outstanding. We believe this
measure is important to many investors who are interested in
changes from period to period in book value per common share
exclusive of changes in intangible assets associated with prior
acquisitions.
“Tangible assets” is defined as total assets reduced by
intangible assets, including goodwill. We believe this measure is
important to many investors who are interested in changes from
period to period in total assets exclusive of changes in intangible
assets.
“Tangible assets excluding private banking loans” is defined as
total assets reduced by intangible assets, including goodwill, and
private banking loans. We believe this measure is important to many
investors who are interested in changes from period to period in
total assets exclusive of changes in intangible assets and private
banking loans.
“Tangible common equity ratio” is defined as (i) common
shareholders’ equity reduced by intangible assets, including
goodwill, divided by (ii) total assets reduced by intangible
assets, including goodwill. We believe this measure is important to
many investors who are interested in changes from period to period
in the ratio of common shareholders’ equity to total assets
exclusive of changes in intangible assets.
“Tangible common equity ratio excluding private banking loans”
is defined as (i) common shareholders’ equity reduced by intangible
assets, including goodwill, divided by (ii) total assets reduced by
intangible assets, including goodwill, and private banking loans.
We believe this measure is important to many investors who are
interested in changes from period to period in the ratio of common
shareholders’ equity to total assets exclusive of changes in
intangible assets and private banking loans.
“EBITDA” is defined as net income before interest expense,
income tax expense, depreciation expense and intangible
amortization expense. We use EBITDA particularly to assess the
strength of our investment management business. We believe this
measure is important because it allows management and investors to
better assess our investment management performance in relation to
our core operating earnings by excluding certain non-cash items and
the volatility that is associated with certain discrete items that
are unrelated to our core business.
“Total revenue” is defined as net interest income and total
non-interest income, excluding gains and losses on the sale and
call of debt securities. We believe adjustments made to our
operating revenue allow management and investors to better assess
our core operating revenue by removing the volatility that is
associated with certain items that are unrelated to our core
business.
“Pre-tax, pre-provision net revenue” is defined as net interest
income and non-interest income, excluding gains and losses on the
sale and call of debt securities and total non-interest expense. We
believe this measure is important because it allows management and
investors to better assess our performance in relation to our core
operating revenue, excluding the volatility that is associated with
provision for loan and lease losses and changes in our tax rates
and other items that are unrelated to our core business.
“Efficiency ratio” is defined as total non-interest expense
divided by our total revenue. We believe this measure allows
management and investors to better assess our operating expenses in
relation to our core operating revenue, particularly at the
Bank.
TRISTATE CAPITAL HOLDINGS, INC.
NON-GAAP FINANCIAL MEASURES
(UNAUDITED)
June 30,
March 31,
June 30,
(Dollars in thousands, except per share
data)
2021
2021
2020
Tangible common equity and tangible
book value per common share:
Common shareholders’ equity
$
615,225
$
596,043
$
516,752
Less: goodwill and intangible assets
62,955
63,433
64,867
Tangible common equity (numerator)
$
552,270
$
532,610
$
451,885
Common shares outstanding
(denominator)
33,176,934
33,160,605
29,851,550
Tangible book value per common share
$
16.65
$
16.06
$
15.14
(Dollars in thousands)
June 30,
March 31,
June 30,
2021
2021
2020
Tangible common equity ratio excluding
private banking channel loans:
Common shareholders' equity
$
615,225
$
596,043
$
516,752
Less: goodwill and intangible assets
62,955
63,433
64,867
Tangible common equity (numerator)
$
552,270
$
532,610
$
451,885
Total assets
11,541,172
10,565,150
9,129,841
Less: goodwill and intangible assets
62,955
63,433
64,867
Tangible assets
$
11,478,217
$
10,501,717
$
9,064,974
Tangible common equity ratio
4.81
%
5.07
%
4.98
%
Less: private banking loans
5,713,562
5,053,621
4,063,116
Tangible assets excluding private banking
loans (denominator)
$
5,764,655
$
5,448,096
$
5,001,858
Tangible common equity ratio excluding
private banking loans
9.58
%
9.78
%
9.03
%
INVESTMENT MANAGEMENT SEGMENT
NON-GAAP FINANCIAL MEASURES
(UNAUDITED)
Three Months Ended
Six Months Ended
June 30,
March 31,
June 30,
June 30,
June 30,
(Dollars in thousands)
2021
2021
2020
2021
2020
Investment Management EBITDA:
Net income
$
1,196
$
1,025
$
336
$
2,221
$
914
Interest expense
—
—
—
—
—
Income tax expense
286
310
102
596
130
Depreciation expense
103
103
107
206
216
Intangible amortization expense
478
478
486
956
988
EBITDA
$
2,063
$
1,916
$
1,031
$
3,979
$
2,248
TRISTATE CAPITAL HOLDINGS, INC.
NON-GAAP FINANCIAL MEASURES
(UNAUDITED)
Three Months Ended
Six Months Ended
June 30,
March 31,
June 30,
June 30,
June 30,
(Dollars in thousands)
2021
2021
2020
2021
2020
Total revenue and pre-tax,
pre-provision net revenue:
Net interest income
$
42,912
$
38,656
$
33,484
$
81,568
$
68,406
Total non-interest income
14,844
13,651
12,997
28,495
26,313
Less: net gain (loss) on the sale and call
of debt securities
98
(1)
14
97
71
Total revenue
$
57,658
$
52,308
$
46,467
$
109,966
$
94,648
Less: total non-interest expense
34,425
31,278
28,096
65,703
57,240
Pre-tax, pre-provision net revenue
$
23,233
$
21,030
$
18,371
$
44,263
$
37,408
BANK SEGMENT
NON-GAAP FINANCIAL MEASURES
(UNAUDITED)
Three Months Ended
Six Months Ended
June 30,
March 31,
June 30,
June 30,
June 30,
(Dollars in thousands)
2021
2021
2020
2021
2020
Bank total revenue:
Net interest income
$
44,356
$
40,153
$
34,410
$
84,509
$
69,316
Total non-interest income
5,381
4,630
5,229
10,012
10,937
Less: net gain (loss) on the sale and call
of debt securities
98
(1)
14
97
71
Bank total revenue
$
49,639
$
44,784
$
39,625
$
94,424
$
80,182
Bank efficiency ratio:
Total non-interest expense (numerator)
$
25,570
$
22,655
$
19,967
$
48,225
$
41,000
Bank total revenue (denominator)
$
49,639
$
44,784
$
39,625
$
94,424
$
80,182
Bank efficiency ratio
51.51
%
50.59
%
50.39
%
51.07
%
51.13
%
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210721005909/en/
MEDIA Hornercom Jack Horner 267-932-8760, ext. 302
412-600-2295 (mobile) jack@hornercom.com INVESTOR RELATIONS
Lambert Jeff Schoenborn and Kate Croft 888-609-8351
TSC@lambert.com
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