EX-99.1 2 d745076dex991.htm EX-99.1 EX-99.1
NASDAQ: IBTX
Stephens Texas Field Trip
June 2014
Presenters:
David Brooks, Chairman and CEO
Michelle Hickox, EVP and CFO
Exhibit 99.1


Safe Harbor Statement
2
From time to time, our comments and releases may contain “forward-looking statements” within the meaning of the Private Securities Litigation
Reform Act of 1995 (the “Act”). Forward-looking statements can be identified by words such as “believes,” “anticipates,” “expects,” “forecast,”
“guidance,” “intends,” “targeted,” “continue,” “remain,” “should,” “may,” “plans,” “estimates,” “will,” “will continue,” “will remain,” variations on such
words or phrases, or similar references to future occurrences or events in future periods; however, such words are not the exclusive means of
identifying such statements. Examples of forward-looking statements include, but are not limited to: (i) projections of revenues, expenses, income
or loss, earnings or loss per share, and other financial items; (ii) statements of plans, objectives, and expectations of Independent Bank Group or
its management or Board of Directors; (iii) statements of future economic performance; and (iv) statements of assumptions underlying such
statements. Our estimates of earnings and earnings per share accretion, book value earn-back and tangible book value dilution are forward-
looking statements. Forward-looking statements are based on Independent Bank Group’s current expectations and assumptions regarding its
business, the economy, and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent
uncertainties, risks, and changes in circumstances that are difficult to predict. Independent Bank Group’s actual results may differ materially from
those contemplated by the forward-looking statements, which are neither statements of historical fact nor guarantees or assurances of future
performance. Factors that could cause actual results to differ from those discussed in the forward-looking statements include, but are not limited
to: (1) local, regional, national, and international economic conditions and the impact they may have on us and our customers and our
assessment of that impact; (2) volatility and disruption in national and international financial markets; (3) government intervention in the U.S.
financial system, whether through changes in the discount rate or money supply or otherwise; (4) changes in the level of non-performing assets
and charge-offs; (5) changes in estimates of future reserve requirements based upon the periodic review thereof under relevant regulatory and
accounting requirements; (6) adverse conditions in the securities markets that lead to impairment in the value of securities in our investment
portfolio; (7) inflation, deflation, changes in market interest rates, developments in the securities market, and monetary fluctuations; (8) the timely
development and acceptance of new products and services and perceived overall value of these products and services by customers; (9)
changes in consumer spending, borrowings, and savings habits; (10) technological changes; (11) the ability to increase market share and control
expenses; (12) changes in the competitive environment among banks, bank holding companies, and other financial service providers; (13) the
effect of changes in laws and regulations (including laws and regulations concerning taxes, banking, securities, and insurance) with which we and
our subsidiaries must comply; (14) the effect of changes in accounting policies and practices, as may be adopted by the regulatory agencies, as
well as the Public Company Accounting Oversight Board, the Financial Accounting Standards Board, and other accounting standard setters; (15)
the costs and effects of legal and regulatory developments including the resolution of legal proceedings; and (16) our success at managing the
risks involved in the foregoing items and (17) the other factors that are described in the Company’s Form 10-K for the year ended December 31,
2013, under the heading “Risk Factors.” Any forward-looking statement made by the Company in this release speaks only as of the date on which
it is made. Factors or events that could cause the Company’s actual results to differ may emerge from time to time, and it is not possible for the
Company to predict all of them. The Company undertakes no obligation to publicly update any forward-looking statement, whether as a result of
new information, future developments or otherwise, except as may be required by law.


Company Snapshot
3
Overview
Branch Map as of April 15, 2014
Financial
Highlights
as
of
March
31,
2014
(1)
Headquartered in McKinney, Texas
100+ years of operating history
35 banking offices in 27 communities
Dallas-Fort Worth metropolitan area
Greater Austin area
Houston metropolitan area
Acquired Bank of Houston and its six locations April 15, 2014
Announced acquisition of Houston City Bancshares on June 2, 2014
Note: Financial data as of and for the quarter ended March 31, 2014.
(1) Does not include Bank of Houston or Houston City acquisitions.
Balance Sheet ($ in millions)
Total Assets
$2,354
Total Loans
1,893
Total Deposits
1,891
Equity
253
Equity / Assets
10.73%
Asset Quality
NPAs / Assets
0.51%
NPLs / Loans
0.48
Allowance / NPLs
162.96
Allowance / Loans
0.78
NCO Ratio (annualized)
0.08
Profitability
ROAA
0.84%
ROAE
7.90
Net Interest Margin
4.17
Efficiency Ratio
65.7


First Quarter 2014 Highlights
4
Core net income was $5.0 million, or $0.39 per diluted share, for the quarter
ended March 31, 2014 compared to $4.9 million, or $0.40 per diluted share, for
the quarter ended December 31, 2013 and to $3.7 million, or $0.44 per diluted
share, for the quarter ended March 31, 2013.
Loans
held
for
investment
grew
organically
at
an
annualized
rate
of
23.2%
in
the
first quarter 2014.
Continued strong asset quality, as reflected by a nonperforming assets to total
assets ratio of 0.51%, a nonperforming loans to total loans ratio of 0.48%, and
an annualized net charge-offs to average loans ratio of 0.08% at March 31,
2014.
Completion of the acquisitions of Live Oak Financial Corp. on January 1, 2014
and BOH Holdings, Inc. and its subsidiary, Bank of Houston, on April 15, 2014.


Bank of Houston Acquisition
Closed April 15, 2014
Marks IBTX’s entry into the dynamic Houston market, resulting in
a significant presence in three of the nation’s most attractive
MSAs:  Dallas, Austin, Houston
Total Assets of $1.18 billion
Total Deposits of $820.8 million
Total Loans of $786.1 million
Total Equity of $96.3 million
At announcement, approximately 1.80x book and 2.46x tangible
book
EPS accretion estimated at ~12% in 2014 and ~20% in 2015 with
an estimated TBV earn-back period of 2.6 years
5
As of April 15, 2014.


Proforma IBTX/Bank of Houston
6
As of March 31, 2014.
($ in thousands)
Total Assets
$3,526,131
Total Loans
2,673,365
Total Deposits
2,697,655
Capital Ratios
Leverage Ratio
9.49%
Tier 1 RWA Ratio
10.72
Total Capital to RWA
11.53
Tangible Common Equity to Tangible Assets
7.40


Houston City Bancshares Acquisition
Announced on June 2, 2014
First follow-on acquisition in Houston, adding six full service
banking locations to the dynamic and growing Houston market
Total Assets of $323 million
Total Deposits of $296 million
Total Loans of $202 million
Total Equity of $27 million
At announcement, approximately 1.80x book and 1.87x tangible
book
Estimated to be immediately accretive to earnings and slightly dilutive to
tangible book value at closing
7
As of March 31, 2014.


Proforma IBTX/Bank of Houston/Houston City
8
Pro forma includes planned $60 million subordinated debt issuance.
($ in thousands)
March 31, 2014
Total Assets
$3,913,674
Total Gross Loans
2,872,953
Total Deposits
2,993,655
Capital Ratios
Tier 1 Leverage Ratio
7.96%
Tier 1 Risk-Based Capital Ratio
9.69
Total Risk-Based Capital Ratio
12.37
Tangible Common Equity to Tangible Assets
6.92


IBTX Continued Demonstrated Growth
9
Total Assets Prior Years
Total
Assets
Q1
2014
v.
Q1
2013
(1)
Note: Dollars in millions. Pre Bank of Houston and Houston City acquisitions.
(1) Reflects increase through organic growth, acquisitions and retained proceeds from the initial public offering.


IBTX Expanded Profitability
10
Core
Pre-Tax
Pre-Provision
Earnings
Income
(1)
Note:
Dollars
in
thousands.
Pre
Bank
of
Houston
and
Houston
City
acquisitions.
(1) See Appendix for non-GAAP Reconciliation.


Diversified Loan Portfolio
11
Loan Composition at 3/31/14
CRE Loan Composition at 3/31/14
2014 YTD Yield on Loans: 5.33%
Net of Acquired Loan Accretion: 5.25%
42.7% of CRE Loans are Owner-Occupied
Note: Pre Bank of Houston and Houston City acquisitions.


Historically Strong Credit Culture
12
NPLs / Loans
Note: Financial data through 2013 as of and for years ended December 31, 2014 as of and for the quarter ended March 31, 2014. Does not include recent acquisitions.
Source: U.S. and Texas Commercial Bank numbers from SNL Financial.
NCOs / Average Loans


Summary
13
A Leading Texas Community Bank Franchise Focused in
Major Metropolitan Markets (Dallas, Austin, Houston)
Significant Inside Ownership Aligned with Shareholders
Demonstrated Organic Growth
Announced Eight Acquisitions over Past Four Years
Increased Profitability and Improving Efficiency
Strong Credit Culture and Excellent Credit Quality


APPENDIX
14


Experienced Management Team
15
Name / Title
Background
David R. Brooks
Chairman of the Board, CEO, Director
35 years in the financial services industry; 27 years at Independent Bank
Active
in
community
banking
since
the
early
1980s
-
led
the
investor
group
that
acquired
the Company in 1988
Previously served as the Chief Financial Officer at Baylor University from 2000 to 2004
Serves on the Board of Managers of Noel-Levitz, LLC, and on the Board of Trustees of
Houston Baptist University
Torry Berntsen
President, COO, Director
34 years in the financial services industry; 5 years at Independent Bank
Served as Vice Chairman of Corporate Development from 2009 to 2013
Vice Chairman of Virtu Management, LLC
25 years in various senior management roles at The Bank of New York Mellon
Daniel W. Brooks
Vice Chairman, Chief Risk Officer, Director
31 years in the financial services industry; 25 years at Independent Bank
Previously served as President and a Director of the Company from 2002 to 2009
Active in community banking since the late 1980s
Chairman of the Board for Medical Center of McKinney and on the Boards of Directors of
McKinney Christian Academy and the McKinney Education Foundation
James D. Stein
Vice Chairman, CEO –
Houston, Director
30 years in the financial services industry; 9 years at Bank of Houston/Independent Bank
Founding President and CEO of Bank of Houston
Served as President of Columbus State Bank and on the Board of the Texas Bankers
Association
Active in various Houston based non-profit organizations
Brian E. Hobart
Vice Chairman, Chief Lending Officer
21 years in the financial services industry; 10 years at Independent Bank
Since
2009
he
has
functioned
as
Chief
Lending
Officer
as
well
as
serving
as
President
and director at the Company
One
of
the
founders
of
IBG
Central
Texas
-
served
as
its
President
from
2004
until
2009
Michelle S. Hickox
EVP, Chief Financial Officer
24 years in the financial services industry; 2 years at the Company
Previously a Financial Services Audit Partner at McGladrey LLP
Licensed certified public accountant, member of the AICPA, the Texas Society of
Certified Public Accountants and the Dallas CPA Society


Reconciliation of Non-GAAP and Adjusted Measures
16
($ in thousands)
2011
2012
2013
2013
2014
Net Interest Income - Reported
$46,281
$58,553
$74,933
$18,215
$22,135
(a)
Write off of debt origination warrants
0
0
223
0
0
(b)
Income recognized on acquired loans
(477)
(233)
(1,399)
(1,068)
(363)
(b)
Adjusted net interest income
$45,804
$58,320
$73,757
$17,147
$21,772
(a + b = c)
Provision Expense - Reported
$1,650
$3,184
$3,822
$1,030
$1,253
(d)
Noninterest Income - Reported
$7,708
$9,168
$11,021
$2,426
$2,334
(e)
Loss / (Gain) on Sale of Branch
0
(38)
0
0
0
Loss / (Gain) on Sale of OREO
(918)
(1,135)
(1,507)
(25)
(39)
Loss / (Gain) on Sale of Securities
0
3
0
0
0
Loss / (Gain) on Sale of PP&E
(21)
343
18
(1)
0
Adjusted Noninterest Income
$6,769
$8,341
$9,532
$2,400
$2,295
(f)
Noninterest Expense - Reported
$38,639
$47,160
$57,671
$13,923
$16,076
(g)
Adriatica Expenses
($871)
($832)
($806)
($197)
($23)
OREO Impairment
(184)
(94)
(642)
(448)
0
OREO Back Property Tax
0
0
0
(93)
0
FDIC refund
0
0
504
0
0
IPO related stock grant and bonus expense
0
0
(948)
0
(162)
Acquisition Expense
0
(1,401)
(1,956)
(137)
(476)
Adjusted Noninterest Expense
$37,584
$44,833
$53,823
$13,048
$15,415
(h)
Pre-Tax Pre-Provision Earnings
$15,350
$20,561
$28,283
$6,718
$8,393
(a) + (e) - (g)
Core Pre-Tax Pre-Provision Earnings
$14,989
$21,828
$29,466
$6,499
$8,652
(c) + (f) - (h)
Reported Efficiency Ratio
71.6%
69.6%
67.1%
67.5%
65.7%
(g) / (a + e)
Adjusted Efficiency Ratio
71.5%
67.3%
64.6%
66.8%
64.1%
(h) / (c + f)
Year Ended December 31,
Quarter Ended March 31,


17
($ in thousands, except per share data)
As of
3/31/2014
Total Stockholders' Equity
$252,508
Goodwill
(42,575)
Core Deposit Intangibles
(3,813)
Tangible Common Equity
$206,120
Common Shares Outstanding
12,592,935
Book Value per Share
$20.05
Tangible Book Value per Share
$16.37
($ in thousands)
As of
3/31/2014
Total Stockholders' Equity
$252,508
Unrealized Loss on AFS Securities
(449)
Goodwill
(42,575)
Other Intangibles
(3,813)
Qualifying Restricted Core Capital
17,600
Tier 1 Capital
$223,271
Risk-Weighted Assets
On Balance Sheet
$1,796,153
Off Balance Sheet
71,148
Total Risk-Weighted Assets
$1,867,301
Tier 1 Capital to Risk-Weighted Assets Ratio
11.96%
Reconciliation of Non-GAAP and Adjusted Measures


Contact Information
18
Corporate Headquarters
Analysts/Investors:
Independent Bank Group, Inc.
Torry Berntsen
1600 Redbud Blvd
President and Chief Operating Officer
Suite 400
(972) 562-9004
McKinney, TX 75069
tberntsen@ibtx.com
972-562-9004 Telephone
Michelle Hickox
972-562-7734 Fax
Executive Vice President and Chief Financial Officer
independent-bank.com
(972) 562-9004
mhickox@ibtx.com
Media:
Eileen Ponce
Marketing Director
(469) 742-9437
eponce@ibtx.com