Hilltop Holdings Inc. Announces Financial Results for Second Quarter 2023

DALLAS, July 20, 2023--(BUSINESS WIRE)--Hilltop Holdings Inc. (NYSE: HTH) ("Hilltop") today announced financial results for the second quarter of 2023. Hilltop produced income to common stockholders of $18.1 million, or $0.28 per diluted share, for the second quarter of 2023, compared to $33.3 million, or $0.45 per diluted share, for the second quarter of 2022. Hilltop’s financial results for the second quarter of 2023 included significant decreases in year-over-year mortgage origination segment net gains from sales of loans and other mortgage production income, an increase in the provision for credit losses from a build in the allowance within the banking segment, and increases in net revenues within certain of the broker-dealer segment’s business lines.

Hilltop also announced that its Board of Directors declared a quarterly cash dividend of $0.16 per common share, payable on August 25, 2023, to all common stockholders of record as of the close of business on August 11, 2023.

Headwinds that began in 2022, and continued through the first half of 2023, including the impact of tight housing inventories on mortgage volumes, declining deposit balances, rapid increases in market interest rates and a declining economic forecast have had, and are expected to continue to have, an adverse impact on our operating results during the remainder of 2023. The impacts of such headwinds during the remainder of 2023 remain uncertain and will depend on developments outside of our control, including, among others, the timing and significance of further changes in U.S. treasury yields and mortgage interest rates, exposure to increasing funding costs, inflationary pressures associated with compensation, occupancy and software costs and labor market conditions, the Russian-Ukraine conflict and its impact on supply chains, and disruptions to the economy and the U.S. banking system caused by recent bank failures.

Jeremy B. Ford, President and CEO of Hilltop, said, "Hilltop’s operating results during the second quarter of 2023 reflected the challenging environment which included rising funding costs, an inverted yield curve and economic uncertainties. PlainsCapital Bank recognized an increase in its provision expense due to a combination of factors including deterioration in the economic outlook, negative credit migration and loan growth, as well as a decline in its net interest margin. At PrimeLending, we saw a modest rebound in the gain-on-sale margin, though the business continues to face challenges from a lack of housing inventory and affordability across the country. HilltopSecurities benefited from higher interest rates this quarter that drove a pre-tax margin of 16% on a 13% year-over-year increase in net revenues.

"As we enter the second half of 2023, we remain focused on maintaining our strong capital and liquidity positions, controlling expenses, and continuing to serve our valued clients."

Second Quarter 2023 Highlights for Hilltop:

• The provision for credit losses was $14.8 million during the second quarter of 2023, compared to a provision for credit losses of $2.3 million in the first quarter of 2023 and a provision for credit losses of $5.3 million in the second quarter of 2022;

  • The provision for credit losses during the second quarter of 2023 reflected a significant build in the allowance related to loan portfolio changes since the prior quarter and a deteriorating outlook for commercial real estate markets.

• For the second quarter of 2023, net gains from sale of loans and other mortgage production income and mortgage loan origination fees within our mortgage origination segment was $90.0 million, compared to $139.9 million in the second quarter of 2022, a 35.7% decrease;

  • Mortgage loan origination production volume was $2.5 billion during the second quarter of 2023, compared to $3.8 billion in the second quarter of 2022;

  • Net gains from mortgage loans sold to third parties increased to 207 basis points during the second quarter of 2023, compared to 193 basis points in the first quarter of 2023.

• Hilltop’s consolidated annualized return on average assets and return on average stockholders’ equity for the second quarter of 2023 were 0.47% and 3.53%, respectively, compared to 0.80% and 5.82%, respectively, for the second quarter of 2022;

• Hilltop’s book value per common share increased to $31.71 at June 30, 2023, compared to $31.63 at March 31, 2023;

• Hilltop’s total assets were $17.1 billion and $17.0 billion at June 30, 2023 and March 31, 2023, respectively;

• Loans¹, net of allowance for credit losses, were $7.9 billion and $7.7 billion at June 30, 2023 and March 31, 2023, respectively;

• Non-performing loans were $39.0 million, or 0.40% of total loans, at June 30, 2023, compared to $27.4 million, or 0.30% of total loans, at March 31, 2023;

• Loans held for sale increased by 28.2% from March 31, 2023 to $1.3 billion at June 30, 2023;

• Total deposits were $11.2 billion and $11.1 billion at June 30, 2023 and March 31, 2023, respectively;

  • Total estimated uninsured deposits were $4.4 billion, or approximately 40% of total deposits, while estimated uninsured deposits, excluding collateralized deposits of $350.7 million, were $4.1 billion, or approximately 37% of total deposits at June 30, 2023.

• Hilltop maintained strong capital levels² with a Tier 1 Leverage Ratio³ of 11.47% and a Common Equity Tier 1 Capital Ratio of 17.63% at June 30, 2023;

• Hilltop’s consolidated net interest margin⁴ decreased to 3.03% for the second quarter of 2023, compared to 3.28% in the first quarter of 2023;

• For the second quarter of 2023, noninterest income was $190.7 million, compared to $239.3 million in the second quarter of 2022, a 20.3% decrease;

• For the second quarter 2023, noninterest expense was $267.0 million, compared to $298.5 million in the second quarter of 2022, a 10.6% decrease; and

• Hilltop’s effective tax rate was 26.4% during the second quarter of 2023, compared to 25.6% during the same period in 2022.

  • The effective tax rate for the second quarter of 2023 was higher than the applicable statutory rate primarily due to the booking of additional taxes from a recent change in the source of funding for an acquired non-qualified, deferred compensation plan.

______________________________
1	"Loans" reflect loans held for investment excluding broker-dealer margin loans, net of allowance for credit losses, of $358.5 million and $360.6 million at June 30, 2023 and March 31, 2023, respectively.
2	Capital ratios reflect Hilltop’s decision to elect the transition option as issued by the federal banking regulatory agencies in March 2020 that permits banking institutions to mitigate the estimated cumulative regulatory capital effects from CECL over a five-year transitionary period.
3	Based on the end of period Tier 1 capital divided by total average assets during the quarter, excluding goodwill and intangible assets.
4	Net interest margin is defined as net interest income divided by average interest-earning assets.

Consolidated Financial and Other Information
Consolidated Balance Sheets		June 30,				March 31,				December 31,				September 30,				June 30,
(in 000's)		2023				2023				2022				2022				2022
Cash and due from banks		$	1,584,709			$	1,764,081			$	1,579,512			$	1,777,584			$	1,783,554
Federal funds sold			650				743				650				663				381
Assets segregated for regulatory purposes			50,711				36,199				67,737				109,358				120,816
Securities purchased under agreements to resell			143,982				144,201				118,070				145,365				139,929
Securities:
Trading, at fair value			696,649				692,908				755,032				641,864				593,273
Available for sale, at fair value, net (1)			1,526,869				1,641,571				1,658,766				1,584,724				1,562,222
Held to maturity, at amortized cost, net (1)			847,437				862,280				875,532				889,452				920,583
Equity, at fair value			258				231				200				209				197
			3,071,213				3,196,990				3,289,530				3,116,249				3,076,275
Loans held for sale			1,333,044				1,040,138				982,616				1,003,605				1,491,579
Loans held for investment, net of unearned income			8,354,122				8,192,846				8,092,673				7,944,246				7,930,619
Allowance for credit losses			(109,306	)			(97,354	)			(95,442	)			(91,783	)			(95,298	)
Loans held for investment, net			8,244,816				8,095,492				7,997,231				7,852,463				7,835,321
Broker-dealer and clearing organization receivables			1,474,177				1,560,246				1,038,055				1,255,052				1,049,830
Premises and equipment, net			176,574				180,132				184,950				191,423				195,361
Operating lease right-of-use assets			97,979				100,122				102,443				103,099				106,806
Mortgage servicing assets			95,101				103,314				100,825				156,539				121,688
Other assets			588,166				529,438				518,899				624,235				513,570
Goodwill			267,447				267,447				267,447				267,447				267,447
Other intangible assets, net			9,772				10,544				11,317				12,209				13,182
Total assets		$	17,138,341			$	17,029,087			$	16,259,282			$	16,615,291			$	16,715,739
Deposits:
Noninterest-bearing		$	3,451,438			$	3,807,878			$	3,968,862			$	4,546,816			$	4,601,643
Interest-bearing			7,712,739				7,289,269				7,346,887				6,805,198				7,319,143
Total deposits			11,164,177				11,097,147				11,315,749				11,352,014				11,920,786
Broker-dealer and clearing organization payables			1,306,646				1,383,317				966,470				1,176,156				934,818
Short-term borrowings			1,628,637				1,572,794				970,056				942,309				822,649
Securities sold, not yet purchased, at fair value			74,761				51,497				53,023				99,515				135,968
Notes payable			364,531				376,410				346,654				390,354				389,722
Operating lease liabilities			119,999				122,878				126,759				120,635				124,406
Other liabilities			389,336				341,246				417,042				475,425				329,987
Total liabilities			15,048,087				14,945,289				14,195,753				14,556,408				14,658,336
Common stock			651				650				647				646				646
Additional paid-in capital			1,050,191				1,044,774				1,046,331				1,043,605				1,039,261
Accumulated other comprehensive loss			(131,718	)			(125,461	)			(133,531	)			(119,864	)			(95,279	)
Retained earnings			1,144,624				1,136,901				1,123,636				1,107,586				1,085,208
Deferred compensation employee stock trust, net			450				446				481				479				695
Employee stock trust			(599	)			(599	)			(640	)			(641	)			(954	)
Total Hilltop stockholders' equity			2,063,599				2,056,711				2,036,924				2,031,811				2,029,577
Noncontrolling interests			26,655				27,087				26,605				27,072				27,826
Total stockholders' equity			2,090,254				2,083,798				2,063,529				2,058,883				2,057,403
Total liabilities & stockholders' equity		$	17,138,341			$	17,029,087			$	16,259,282			$	16,615,291			$	16,715,739

______________________________
(1)	At June 30, 2023, the amortized cost of the available for sale securities portfolio was $1,658,036, while the fair value of the held to maturity securities portfolio was $755,186.

		Three Months Ended
Consolidated Income Statements		June 30,			March 31,			December 31,			September 30,				June 30,
(in 000's, except per share data)		2023			2023			2022			2022				2022
Interest income:
Loans, including fees		$	138,397		$	123,379		$	117,906		$	109,165			$	98,728
Securities borrowed			18,515			17,068			14,162			10,938				10,498
Securities:
Taxable			... 26,719			25,602			23,293			19,642				17,288
Tax-exempt			2,566			3,188			3,002			2,451				2,141
Other			27,229			22,190			21,611			14,276				6,478
Total interest income			213,426			191,427			179,974			156,472				135,133
Interest expense:
Deposits			54,726			35,824			28,238			12,525				5,456
Securities loaned			16,413			15,346			13,179			9,407				8,512
Short-term borrowings			17,706			12,444			10,278			5,550				3,020
Notes payable			3,973			3,853			3,988			3,907				3,809
Other			2,342			2,255			849			1,597				2,280
Total interest expense			95,160			69,722			56,532			32,986				23,077
Net interest income			118,266			121,705			123,442			123,486				112,056
Provision for (reversal of) credit losses			14,836			2,331			3,638			(780	)			5,336
Net interest income after provision for (reversal of) credit losses			103,430			119,374			119,804			124,266				106,720
Noninterest income:
Net gains from sale of loans and other mortgage production income			48,535			39,966			35,949			57,998				97,543
Mortgage loan origination fees			41,440			28,777			35,198			39,960				42,378
Securities commissions and fees			29,606			31,223			33,143			34,076				34,757
Investment and securities advisory fees and commissions			32,037			26,848			30,661			35,031				32,002
Other			39,034			35,680			34,833			39,910				32,593
Total noninterest income			190,652			162,494			169,784			206,975				239,273
Noninterest expense:
Employees' compensation and benefits			176,908			167,817			167,892			200,450				205,327
Occupancy and equipment, net			23,025			22,865			23,077			25,041				24,231
Professional services			12,594			10,697			11,555			10,631				16,246
Other			54,450			49,091			50,844			52,616				52,739
Total noninterest expense			266,977			250,470			253,368			288,738				298,543
Income before income taxes			27,105			31,398			36,220			42,503				47,450
Income tax expense			7,167			3,630			9,642			9,249				12,127
Net income			19,938			27,768			26,578			33,254				35,323
Less: Net income attributable to noncontrolling interest			1,805			1,968			1,022			1,186				2,063
Income attributable to Hilltop		$	18,133		$	25,800		$	25,556		$	32,068			$	33,260
Earnings per common share:
Basic		$	0.28		$	0.40		$	0.40		$	0.50			$	0.45
Diluted		$	0.28		$	0.40		$	0.39		$	0.50			$	0.45
Cash dividends declared per common share		$	0.16		$	0.16		$	0.15		$	0.15			$	0.15
Weighted average shares outstanding:
Basic			65,025			64,901			64,602			64,552				73,693
Diluted			65,054			64,954			64,779			64,669				73,838

		Three Months Ended June 30, 2023
Segment Results									Mortgage								All Other and				Hilltop
(in 000's)		Banking			Broker-Dealer				Origination				Corporate				Eliminations				Consolidated
Net interest income (expense)		$	100,986		$	13,201			$	(5,901	)		$	(3,479	)		$	13,459			$	118,266
Provision for (reversal of) credit losses			14,900			(64	)			—				—				—				14,836
Noninterest income			11,189			100,040				90,079				3,081				(13,737	)			190,652
Noninterest expense			57,436			94,853				98,660				16,301				(273	)			266,977
Income (loss) before taxes		$	39,839		$	18,452			$	(14,482	)		$	(16,699	)		$	(5	)		$	27,105

		Six Months Ended June 30, 2023
Segment Results								Mortgage								All Other and				Hilltop
(in 000's)		Banking			Broker-Dealer			Origination				Corporate				Eliminations				Consolidated
Net interest income (expense)		$	205,756		$	27,064		$	(10,109	)		$	(6,801	)		$	24,061			$	239,971
Provision for (reversal of) credit losses			16,500			667			—				—				—				17,167
Noninterest income			22,379			190,675			158,909				5,786				(24,603	)			353,146
Noninterest expense			113,563			185,198			187,413				31,814				(541	)			517,447
Income (loss) before taxes		$	98,072		$	31,874		$	(38,613	)		$	(32,829	)		$	(1	)		$	58,503

		Three Months Ended
		June 30,				March 31,				December 31,				September 30,				June 30,
Selected Financial Data		2023				2023				2022				2022				2022
Hilltop Consolidated:
Return on average stockholders' equity			3.53	%			5.12	%			4.99	%			6.26	%			5.82	%
Return on average assets			0.47	%			0.69	%			0.63	%			0.79	%			0.80	%
Net interest margin (1)			3.03	%			3.28	%			3.23	%			3.19	%			2.75	%
Net interest margin (taxable equivalent) (2):
As reported			3.03	%			3.28	%			3.24	%			3.20	%			2.76	%
Impact of purchase accounting			9 bps				6 bps				7 bps				8 bps				8 bps
Book value per common share ($)			31.71				31.63				31.49				31.46				31.43
Shares outstanding, end of period (000's)			65,071				65,023				64,685				64,591				64,576
Dividend payout ratio (3)			57.37	%			40.25	%			37.92	%			30.19	%			33.33	%
Banking Segment:
Net interest margin (1)			3.11	%			3.40	%			3.42	%			3.42	%			2.97	%
Net interest margin (taxable equivalent) (2):
As reported			3.11	%			3.41	%			3.43	%			3.43	%			2.98	%
Impact of purchase accounting			11 bps				7 bps				8 bps				10 bps				10 bps
Accretion of discount on loans ($000's)			3,334				1,870				2,173				2,858				3,011
Net recoveries (charge-offs) ($000's)			(2,884	)			(419	)			21				(2,735	)			(1,223	)
Return on average assets			0.89	%			1.44	%			1.31	%			1.41	%			1.09	%
Fee income ratio			10.0	%			9.6	%			9.8	%			9.9	%			11.0	%
Efficiency ratio			51.2	%			48.4	%			48.9	%			48.9	%			50.4	%
Employees' compensation and benefits ($000's)			30,603				32,681				34,526				35,934				33,554
Broker-Dealer Segment:
Net revenue ($000's) (4)			113,241				104,498				106,919				114,184				100,229
Employees' compensation and benefits ($000's)			65,290				62,429				60,552				70,274				64,494
Variable compensation expense ($000's)			34,798				30,821				32,042				42,567				37,471
Compensation as a % of net revenue			57.7	%			59.7	%			56.6	%			61.5	%			64.3	%
Pre-tax margin (5)			16.3	%			12.8	%			18.5	%			15.3	%			9.1	%
Mortgage Origination Segment:
Mortgage loan originations - volume ($000's):
Home purchases			2,301,007				1,607,330				1,895,731				2,832,136				3,342,103
Refinancings			150,643				125,423				147,511				211,075				467,117
Total mortgage loan originations - volume			2,451,650				1,732,753				2,043,242				3,043,211				3,809,220
Mortgage loan sales - volume ($000's)			2,115,706				1,661,521				2,038,990				3,419,950				3,872,935
Net gains from mortgage loan sales (basis points):
Loans sold to third parties			207				193				211				227				260
Impact of loans retained by banking segment			(6	)			(7	)			(19	)			(9	)			(7	)
As reported			201				186				192				218				253
Mortgage servicing rights asset ($000's) (6)			95,101				103,314				100,825				156,539				121,688
Employees' compensation and benefits ($000's)			70,982				62,355				64,940				86,079				100,206
Variable compensation expense ($000's)			36,249				25,573				26,724				44,312				56,525

______________________________
(1)	Net interest margin is defined as net interest income divided by average interest-earning assets.
(2)	Net interest margin (taxable equivalent), a non-GAAP measure, is defined as taxable equivalent net interest income divided by average interest-earning assets. Taxable equivalent adjustments are based on the applicable 21% federal income tax rate for all periods presented. The interest income earned on certain earning assets is completely or partially exempt from federal income tax. As such, these tax-exempt instruments typically yield lower returns than taxable investments. To provide more meaningful comparisons of net interest margins for all earning assets, we use net interest income on a taxable-equivalent basis in calculating net interest margin by increasing the interest income earned on tax-exempt assets to make it fully equivalent to interest income earned on taxable investments. The taxable equivalent adjustments to interest income for Hilltop (consolidated) were $0.1 million, $0.1 million, $0.3 million, $0.4 million and $0.4 million, respectively, for the periods presented and for the banking segment were $0.2 million for each of the periods presented.
(3)	Dividend payout ratio is defined as cash dividends declared per common share divided by basic earnings per common share.
(4)	Net revenue is defined as the sum of total broker-dealer net interest income and total broker-dealer noninterest income.
(5)	Pre-tax margin is defined as income before income taxes divided by net revenue.
(6)	Reported on a consolidated basis and therefore does not include mortgage servicing rights assets related to loans serviced for the banking segment, which are eliminated in consolidation.

		June 30,				March 31,				December 31,				September 30,				June 30,
Capital Ratios		2023				2023				2022				2022				2022
Tier 1 capital (to average assets):
PlainsCapital			10.28	%			10.69	%			10.26	%			10.29	%			9.67	%
Hilltop			11.47	%			11.82	%			11.47	%			11.41	%			10.53	%
Common equity Tier 1 capital (to risk-weighted assets):
PlainsCapital			14.51	%			14.97	%			14.98	%			14.68	%			14.65	%
Hilltop			17.63	%			17.99	%			18.23	%			17.45	%			17.24	%
Tier 1 capital (to risk-weighted assets):
PlainsCapital			14.51	%			14.97	%			14.98	%			14.68	%			14.65	%
Hilltop			17.63	%			17.99	%			18.23	%			17.45	%			17.24	%
Total capital (to risk-weighted assets):
PlainsCapital			15.59	%			15.94	%			15.91	%			15.54	%			15.55	%
Hilltop			20.44	%			20.75	%			20.98	%			20.07	%			19.90	%

		June 30,				March 31,				December 31,				September 30,				June 30,
Non-Performing Assets Portfolio Data		2023				2023				2022				2022				2022
Loans accounted for on a non-accrual basis ($000's):
Commercial real estate			3,552				1,973				4,269				4,735				4,947
Commercial and industrial			21,442				10,807				9,095				12,078				13,315
Construction and land development			593				199				198				1				1
1-4 family residential			13,360				14,387				15,941				16,968				16,542
Consumer			9				12				14				16				19
Broker-dealer			—				—				—				—				—
			38,956				27,378				29,517				33,798				34,824
Troubled debt restructurings included in accruing loans held for investment ($000's) (1)			—				—				803				825				857
Non-performing loans ($000's) (1)			38,956				27,378				30,320				34,623				35,681
Non-performing loans as a % of total loans ($000's) (1)			0.40	%			0.30	%			0.33	%			0.39	%			0.38	%
Other real estate owned ($000's)			3,481				3,202				2,325				1,637				1,516
Other repossessed assets ($000's)			—				—				—				—				—
Non-performing assets ($000's) (1)			42,437				30,580				32,645				36,260				37,197
Non-performing assets as a % of total assets ($000's) (1)			0.25	%			0.18	%			0.20	%			0.22	%			0.22	%
Loans past due 90 days or more and still accruing ($000's) (2)			130,036				114,523				92,099				96,532				82,410

______________________________
(1)	Effective January 1, 2023, we adopted Accounting Standards Update ("ASU") 2022-02 which eliminated the recognition and measurement guidance on troubled debt restructurings for creditors. Therefore, we no longer present troubled debt restructurings as a component of non-performing loans and assets.
(2)	Loans past due 90 days or more and still accruing were primarily comprised of loans held for sale and guaranteed by U.S. government agencies, including loans that are subject to repurchase, or have been repurchased, by PrimeLending.

		Three Months Ended June 30,
		2023									2022
		Average				Interest			Annualized		Average				Interest			Annualized
		Outstanding				Earned			Yield or		Outstanding				Earned			Yield or
Net Interest Margin (Taxable Equivalent) Details (1)		Balance				or Paid			Rate		Balance				or Paid			Rate
Assets
Interest-earning assets
Loans held for sale		$	1,043,526			$	14,125		5.41	%	$	1,375,395			$	14,302		4.16	%
Loans held for investment, gross (2)			8,033,095				124,272		6.21	%		7,838,090				84,426		4.32	%
Investment securities - taxable			2,776,375				26,719		3.85	%		2,779,458				17,288		2.49	%
Investment securities - non-taxable (3)			412,609				2,410		2.34	%		250,303				2,557		4.09	%
Federal funds sold and securities purchased under agreements to resell			123,219				2,190		7.13	%		193,851				481		1.00	%
Interest-bearing deposits in other financial institutions			1,711,945				21,273		4.98	%		2,602,154				4,984		0.77	%
Securities borrowed			1,477,502				18,515		4.96	%		1,273,368				10,498		3.26	%
Other			82,608				3,766		18.29	%		53,962				1,013		7.53	%
Interest-earning assets, gross (3)			15,660,879				213,270		5.46	%		16,366,581				135,549		3.32	%
Allowance for credit losses			(97,387	)								(91,619	)
Interest-earning assets, net			15,563,492									16,274,962
Noninterest-earning assets			1,355,997									1,516,266
Total assets		$	16,919,489								$	17,791,228
Liabilities and Stockholders' Equity
Interest-bearing liabilities
Interest-bearing deposits		$	7,736,582			$	54,726		2.84	%	$	7,768,772			$	5,456		0.28	%
Securities loaned			1,373,435				16,413		4.79	%		1,114,923				8,512		3.06	%
Notes payable and other borrowings			1,861,063				24,021		5.18	%		1,303,678				9,109		2.80	%
Total interest-bearing liabilities			10,971,080				95,160		3.48	%		10,187,373				23,077		0.91	%
Noninterest-bearing liabilities
Noninterest-bearing deposits			3,540,643									4,552,424
Other liabilities			320,706									731,635
Total liabilities			14,832,429									15,471,432
Stockholders’ equity			2,060,677									2,292,816
Noncontrolling interest			26,383									26,980
Total liabilities and stockholders' equity		$	16,919,489								$	17,791,228
Net interest income (3)						$	118,110								$	112,472
Net interest spread (3)									1.98	%								2.41	%
Net interest margin (3)									3.03	%								2.76	%

______________________________
(1)	Information presented on a consolidated basis.
(2)	Average balance includes non-accrual loans.
(3)	Presented on a taxable-equivalent basis with annualized taxable equivalent adjustments based on the applicable 21% federal income tax rate for the periods presented. The adjustment to interest income was $0.1 million and $0.4 million for the three months ended June 30, 2023 and 2022, respectively.

Conference Call Information

Hilltop will host a live webcast and conference call at 8:00 AM Central (9:00 AM Eastern) on Friday, July 21, 2023. Hilltop President and CEO Jeremy B. Ford and Hilltop CFO William B. Furr will review second quarter 2023 financial results. Interested parties can access the conference call by dialing 1-888-886-7786 (North America) and then using the access code 19821733. The conference call also will be webcast simultaneously on Hilltop’s Investor Relations website (http://ir.hilltop-holdings.com).

About Hilltop

Hilltop Holdings is a Dallas-based financial holding company. Its primary line of business is to provide business and consumer banking services from offices located throughout Texas through PlainsCapital Bank. PlainsCapital Bank’s wholly owned subsidiary, PrimeLending, provides residential mortgage lending throughout the United States. Hilltop Holdings’ broker-dealer subsidiaries, Hilltop Securities Inc. and Momentum Independent Network Inc., provide a full complement of securities brokerage, institutional and investment banking services in addition to clearing services and retail financial advisory. At June 30, 2023, Hilltop employed approximately 4,075 people and operated approximately 344 locations in 48 states. Hilltop Holdings’ common stock is listed on the New York Stock Exchange under the symbol "HTH." Find more information at Hilltop-Holdings.com, PlainsCapital.com, PrimeLending.com and HilltopSecurities.com.

FORWARD-LOOKING STATEMENTS

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

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Contacts

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