Veritex Holdings, Inc. (NASDAQ:VBTX) Q4 2023 Earnings Call Transcript
Veritex Holdings, Inc. (NASDAQ:VBTX) Q4 2023 Earnings Call Transcript January 24, 2024
Veritex Holdings, Inc. isn’t one of the 30 most popular stocks among hedge funds at the end of the third quarter (see the details here).
Operator: Good morning, and welcome to the Veritex Holdings Fourth Quarter 2023 Earnings Conference Call and Webcast. All participants will be in a listen-only mode. Please note this event will be recorded. I will now turn the conference over to Will Holford with Veritex.
Will Holford: Good morning. Thank you for joining Veritex's fourth quarter 2023 earnings call. Before we begin, please be aware this call will include forward-looking statements that are based on our current expectations of future results or events. Forward-looking statements are subject to both known and unknown risk and uncertainties that could cause actual results to differ materially from these statements. Our forward-looking statements are as of the date of this call, and we do not assume any obligation to update or revise them. Statements made on this call should be consider with cautionary statements and other information contained in today's earnings release and our most recent annual report or Form 10-K, and subsequent filings with the SEC.
We will refer to investor slides during today's presentations, which can be found along with the press release in the Investor Relations section of our Web site at veritexbank.com. Our speakers for the call today are Chairman and CEO, Malcolm Holland; our CFO, Terry Earley; and our Chief Credit Officer, Clay Riebe. At the conclusion of our prepared remarks, we will open the lines up for a Q&A session. I will now turn the call over to Malcolm.
Malcolm Holland: Thank you, Will. Good morning, everyone. Today, we'll recap both our fourth quarter results as well as our 2023 annual results. As you will see, we continue to strengthen our balance sheet and add to tangible book value with a clear commitment to the things that will add long-term value to our shareholders. For the quarter, we reported operating earnings of $31.6 million or $0.58 per share, with a pre-tax pre-provision operating return on average assets of 1.54%. For the year 2023, we reported operating earnings of $142.1 million or $2.60 per share, with a pre-tax pre-provision operating return on average assets of 1.81%. Although not the year we had hoped for from an earnings perspective, we were able to use our earnings power to reposition our balance sheet to a much stronger place and still make a nice return for our shareholders.
Our continued profitability also allowed us to meet our goal of CET1 being greater than 10%, ending the year at 10.29%, up over 120 bps over year-end 2022. We were able to slow down our loan growth for the year to 1.7% or just $160 million, a far cry from our 2022 loan growth of 30%-plus. This was accomplished by a focused strategy to move out non-relational borrowers, continued loan payoffs, and general market decline. Concurrently, we were able to grow deposits during the year by 13.3% or $1.2 billion. Again, this was a focused strategy that went into place in the third quarter of 2022, which we're now seeing some of the expected outcomes coming to fruition, certainly a heavy lift and a testament to the resolve of our people during some challenging and volatile times.
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