Veritex (US:VBTX)2025-05-07 13:15Part I — Financial Information This section provides the unaudited consolidated financial statements, management's discussion and analysis, market risk disclosures, and internal control evaluations for the company Financial Statements – Unaudited This section presents the unaudited consolidated financial statements, including balance sheets, income statements, cash flows, and notes, detailing the company's financial position and performance Consolidated Balance Sheets As of March 31, 2025, total assets were $12.61 billion, a slight decrease from $12.77 billion at December 31, 2024, primarily due to reduced loans held for investment Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total Assets | $12,606,091 | $12,768,341 | | Total LHI, net | $9,288,674 | $9,392,799 | | Total Deposits | $10,665,123 | $10,752,592 | | Total Liabilities | $10,972,611 | $11,167,272 | | Total Stockholders' Equity | $1,633,480 | $1,601,069 | Consolidated Statements of Income Net income for Q1 2025 increased by 20.3% to $29.1 million, driven by higher net interest income and the absence of debt security sale losses compared to Q1 2024 Income Statement Summary (in thousands, except per share data) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net Interest Income | $95,441 | $92,806 | | Provision for credit losses on loans | $4,000 | $7,500 | | Total Noninterest Income | $14,289 | $6,662 | | Total Noninterest Expense | $66,834 | $62,116 | | Net Income | $29,070 | $24,156 | | Diluted EPS | $0.53 | $0.44 | Consolidated Statements of Cash Flows Net cash provided by operating activities was $43.6 million, while net cash used in financing activities totaled $183.7 million, resulting in a $5.4 million net decrease in cash and cash equivalents Cash Flow Summary (in thousands) | Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $43,577 | $44,269 | | Net cash provided by (used in) investing activities | $134,702 | $(237,123) | | Net cash (used in) provided by financing activities | $(183,689) | $304,560 | | Net change in cash and cash equivalents | $(5,410) | $111,706 | Notes to Consolidated Financial Statements This section provides detailed disclosures on accounting policies, securities, loans, derivatives, and regulatory capital, highlighting key events like note redemption and stock buybacks - The company repurchased 377,346 shares at a weighted average price of $25.22 per share during the three months ended March 31, 2025, under its stock buyback program37 - In Q1 2025, the company redeemed $75.0 million of its 4.75% fixed-to-floating subordinated notes74 - As of March 31, 2025, the company and the bank's capital ratios exceeded the levels necessary to be categorized as 'well capitalized' under regulatory standards117118 Management's Discussion and Analysis of Financial Condition and Results of Operations Management analyzes the company's financial condition and operational results, highlighting increased net income, asset changes, loan quality, and strong capital position Results of Operations Net income for Q1 2025 increased to $29.1 million, driven by higher noninterest income and an improved net interest margin of 3.31% Quarterly Performance Comparison (in thousands) | Metric | Q1 2025 | Q4 2024 | Q1 2024 | | :--- | :--- | :--- | :--- | | Net Income | $29,070 | $24,882 | $24,156 | | Diluted EPS | $0.53 | $0.45 | $0.44 | | Net Interest Income | $95,441 | $96,141 | $92,806 | | Net Interest Margin | 3.31% | 3.20% | 3.24% | - The increase in noninterest income in Q1 2025 compared to prior periods was significantly impacted by the absence of losses on debt security sales, which were present in both Q4 2024 ($4.4M loss) and Q1 2024 ($6.3M loss)136157 Financial Condition Total assets decreased to $12.61 billion due to a reduction in loans held for investment, while nonperforming assets increased to $96.9 million, and the allowance for credit losses remained stable - Total LHI decreased by $104.5 million (1.1%) to $9.41 billion as of March 31, 2025, compared to December 31, 2024169 Nonperforming Assets (in thousands) | Metric | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total nonperforming loans | $72,633 | $54,435 | | OREO | $24,268 | $24,737 | | Total nonperforming assets | $96,901 | $79,172 | | Nonperforming assets to total assets | 0.77% | 0.62% | - The ACL on LHI was $111.8 million, or 1.19% of total LHI, at March 31, 2025, compared to $111.7 million, or 1.18% of total LHI, at December 31, 2024179 Liquidity and Capital Resources The company maintains strong liquidity with significant borrowing capacity and increased stockholders' equity, while capital ratios remain well above regulatory minimums - As of March 31, 2025, the company had available borrowing capacity of $2.48 billion from the FHLB and $3.09 billion from the FRB196197 - Total stockholders' equity increased by 2.0% to $1.63 billion as of March 31, 2025, primarily due to $29.1 million in net income205 - The company repurchased 377,346 shares for $9.5 million in Q1 2025 and extended its $50 million stock buyback program through March 31, 2026203204226 Quantitative and Qualitative Disclosures about Market Risk The company manages interest rate volatility as its primary market risk, with simulations showing a 100 basis point rate increase would raise net interest income by 3.34% Interest Rate Sensitivity Analysis (as of March 31, 2025) | Change in Interest Rates (BPS) | Percent Change in Net Interest Income | Percent Change in Fair Value of Equity | | :--- | :--- | :--- | | +300 | 8.11% | (11.81)% | | +200 | 5.75% | (7.18)% | | +100 | 3.34% | (3.13)% | | -100 | (2.47)% | 0.55% | | -200 | (4.81)% | (2.40)% | Controls and Procedures Management concluded that the company's disclosure controls and procedures were effective as of March 31, 2025, with no material changes to internal control over financial reporting during the quarter - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of the end of the period covered by the report219 - No material changes were made to the internal control over financial reporting during the quarter ended March 31, 2025220 Part II — Other Information This section covers legal proceedings, risk factors, unregistered sales of equity securities, and a list of exhibits filed with the report Legal Proceedings Management believes it is remote that any current legal proceedings would have a material adverse effect on the company's financial condition, results of operations, or cash flows - In management's opinion, the likelihood of any pending legal proceedings having a material adverse effect on the company is remote223 Risk Factors There have been no material changes to the risk factors previously disclosed in the company's Annual Report on Form 10-K for the year ended December 31, 2024 - No material changes have occurred in the risk factors since the last Annual Report on Form 10-K225 Unregistered Sales of Equity Securities and Use of Proceeds The company repurchased 377,346 shares for $9.5 million in Q1 2025 and extended its $50 million stock buyback program through March 31, 2026 Share Repurchases for Q1 2025 | Period | Total Shares Purchased | Average Price Paid per Share | Total Cost (in thousands) | | :--- | :--- | :--- | :--- | | Jan 2025 | — | — | — | | Feb 2025 | 177,346 | $25.98 | $4,608 | | Mar 2025 | 200,000 | $24.54 | $4,908 | | Total | 377,346 | $25.22 | $9,516 | - On March 25, 2025, the Board authorized the extension of the Stock Buyback Program through March 31, 2026. As of March 31, 2025, approximately $36.9 million remained available for repurchase under the program226 Exhibits This section lists the exhibits filed with the Quarterly Report on Form 10-Q, including certifications by the Principal Executive Officer and Principal Financial Officer, and Inline XBRL data files - Exhibits filed include CEO and CFO certifications pursuant to Sarbanes-Oxley Sections 302 and 906, and financial statements formatted in Inline XBRL227