Form 8-K - Current report

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): October 19, 2023

Hilltop Holdings Inc.

(Exact name of registrant as specified in its charter)


Maryland	1-31987	84-1477939
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)


6565 Hillcrest Avenue
Dallas, Texas		75205
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (214) 855-2177

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to section 12(b) of the Act:


Title of each class	Trading symbol	Name of each exchange on which registered
Common Stock, par value $0.01 per share	HTH	New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 or Rule 12b–2 of the Securities Exchange Act of 1934.

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Section 2 – Financial Information

Item 2.02 Results of Operations and Financial Condition.

On October 19, 2023, Hilltop Holdings Inc., or the Company, issued a press release announcing its results of operations and financial condition as of and for the three months ended September 30, 2023. The text of the release is set forth in Exhibit 99.1 attached to this Current Report on Form 8-K and is incorporated herein by reference.

The information in this Item (including Exhibit 99.1) is being furnished pursuant to Item 2.02 and shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as expressly set forth in such filing.

Section 8 – Other Events

Item 8.01 Other Events.

On October 19, 2023, the Board of Directors of the Company declared a quarterly cash dividend of $0.16 per common share, payable on November 28, 2023, to stockholders of record as of the close of business on November 13, 2023.

Forward-Looking Statements

This Current Report on Form 8-K 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 the Company’s 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, the Company does not assume any duty to update forward-looking statements. Such forward-looking statements include, but are not limited to, statements concerning the Company’s 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. For a list of factors that could cause actual results to differ materially from those set forth in the forward-looking statements, see the risk factors described in the Company’s 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.

Section 9 – Financial Statements and Exhibits

Item 9.01 Financial Statements and Exhibits.

(a)

Financial statements of businesses acquired.

Not applicable.

(b)

Pro forma financial information.

Not applicable.

(c)

Shell company transactions.

Not applicable.

(d)

Exhibits.

The following exhibit(s) are filed or furnished, depending on the relevant item requiring such exhibit, in accordance with the provisions of Item 601 of Regulation S-K and Instruction B.2 to this form.


Exhibit Number		Description of Exhibit
99.1		Press Release issued October 19, 2023 (furnished pursuant to Item 2.02).

104		Cover Page Interactive File (formatted as Inline XBRL).

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.


		Hilltop Holdings Inc.,
		a Maryland corporation


Date:	October 19, 2023	By:	/s/ COREY PRESTIDGE
		Name:	Corey G. Prestidge
		Title:	Executive Vice President,
			General Counsel & Secretary

Exhibit 99.1

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

Hilltop Holdings Inc. Announces Financial Results for Third Quarter 2023

DALLAS — (BUSINESS WIRE) October 19, 2023 — Hilltop Holdings Inc. (NYSE: HTH) (“Hilltop”) today announced financial results for the third quarter of 2023. Hilltop produced income to common stockholders of $37.0 million, or $0.57 per diluted share, for the third quarter of 2023, compared to $32.1 million, or $0.50 per diluted share, for the third quarter of 2022. Hilltop’s financial results for the third quarter of 2023 included decreases in year-over-year mortgage origination segment net gains from sales of loans and other mortgage production income, a decline in the net interest income 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 November 28, 2023, to all common stockholders of record as of the close of business on November 13, 2023.

Headwinds that began in 2022, and continued through the first nine months of 2023, including the impact of tight housing inventories on mortgage volumes, declining deposit balances, rapid increases in market interest rates and a volatile 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, international armed conflicts and their impact on supply chains, and disruptions to the economy and the U.S. banking system caused by high-profile bank failures during early 2023.

Jeremy B. Ford, President and CEO of Hilltop, said “Hilltop’s operating results for the third quarter reflect a general continuation in market pressures experienced in the first half of the year. While PlainsCapital Bank produced strong financial results for the quarter with a 1.20% return on average assets, the competitive environment around deposits resulted in further pressure on the bank’s net interest margin. HilltopSecurities generated robust financial results as the wealth management and structured finance businesses produced strong net revenues, which more than offset challenging market conditions for the public finance and fixed income capital markets businesses. PrimeLending’s results continued to be impacted by the housing market’s lack of inventory, consumer affordability challenges and a stubbornly compressed gain-on-sale margin.

“As we progress into the final quarter of the year, we will continue to prudently manage our balance sheet, closely monitor our expenses and serve our valued clients.”

Third Quarter 2023 Highlights for Hilltop:

●

The reversal of credit losses was $40 thousand during the third quarter of 2023, compared to a provision for credit losses of $14.8 million in the second quarter of 2023 and a reversal of credit losses of $0.8 million in the third quarter of 2022;

o

The slight reversal of credit losses during the third quarter of 2023 reflected improvements to the U.S. economic outlook and decreases in specific reserves within our broker dealer segment, offset by increases in specific reserves and net portfolio changes within the banking segment.

●

For the third 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 $88.7 million, compared to $98.0 million in the third quarter of 2022, a 9.4% decrease;

o

Mortgage loan origination production volume was $2.2 billion during the third quarter of 2023, compared to $3.0 billion in the third quarter of 2022;

o

Net gains from mortgage loans sold to third parties decreased to 199 basis points during the third quarter of 2023, compared to 207 basis points in the second quarter of 2023.

●

Hilltop’s consolidated annualized return on average assets and return on average stockholders’ equity for the third quarter of 2023 were 0.94% and 7.11%, respectively, compared to 0.79% and 6.26%, respectively, for the third quarter of 2022;

●

Hilltop’s book value per common share increased to $31.91 at September 30, 2023, compared to $31.71 at June 30, 2023;

●

Hilltop’s total assets were $16.4 billion and $17.1 billion at September 30, 2023 and June 30, 2023, respectively;

●

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

●

Non-performing loans were $31.5 million, or 0.34% of total loans, at September 30, 2023, compared to $39.0 million, or 0.40% of total loans, at June 30, 2023;

●

Loans held for sale decreased by 20.6% from June 30, 2023 to $1.1 billion at September 30, 2023;

●

Total deposits were $11.1 billion and $11.2 billion at September 30, 2023 and June 30, 2023, respectively;

o

Total estimated uninsured deposits were $4.4 billion, or approximately 40% of total deposits, while estimated uninsured deposits, excluding collateralized deposits of $276.3 million, were $4.2 billion, or approximately 37% of total deposits at September 30, 2023.

●

Hilltop maintained strong capital levels² with a Tier 1 Leverage Ratio³ of 11.92% and a Common Equity Tier 1 Capital Ratio of 18.60% at September 30, 2023;

●

Hilltop’s consolidated net interest margin⁴decreased to 3.02% for the third quarter of 2023, compared to 3.03% in the second quarter of 2023;

●

For the third quarter of 2023, noninterest income was $196.8 million, compared to $207.0 million in the third quarter of 2022, a 4.9% decrease;

●

For the third quarter 2023, noninterest expense was $260.0 million, compared to $288.7 million in the third quarter of 2022, a 9.9% decrease; and

●

Hilltop’s effective tax rate was 25.2% during the third quarter of 2023, compared to 21.8% during the same period in 2022.

o

The effective tax rate for the third quarter was higher than the applicable statutory rate primarily due to the impact of non-deductible compensation expense and other permanent adjustments.

¹ “Loans” reflect loans held for investment excluding broker-dealer margin loans, net of allowance for credit losses, of $357.1 million and $358.5 million at September 30, 2023 and June 30, 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	September 30,		June 30,		March 31,		December 31,		September 30,
(in 000's)	2023		2023		2023		2022		2022
Cash and due from banks	$	1,513,747	$	1,584,709	$	1,764,081	$	1,579,512	$	1,777,584
Federal funds sold		3,650		650		743		650		663
Assets segregated for regulatory purposes		47,491		50,711		36,199		67,737		109,358
Securities purchased under agreements to resell		123,719		143,982		144,201		118,070		145,365
Securities:
Trading, at fair value		578,901		696,649		692,908		755,032		641,864
Available for sale, at fair value, net ⁽¹⁾		1,456,238		1,526,869		1,641,571		1,658,766		1,584,724
Held to maturity, at amortized cost, net ⁽¹⁾		825,079		847,437		862,280		875,532		889,452
Equity, at fair value		264		258		231		200		209
		2,860,482		3,071,213		3,196,990		3,289,530		3,116,249
Loans held for sale		1,058,806		1,333,044		1,040,138		982,616		1,003,605
Loans held for investment, net of unearned income		8,204,052		8,354,122		8,192,846		8,092,673		7,944,246
Allowance for credit losses		(110,822)		(109,306)		(97,354)		(95,442)		(91,783)
Loans held for investment, net		8,093,230		8,244,816		8,095,492		7,997,231		7,852,463

Broker-dealer and clearing organization receivables		1,460,352		1,474,177		1,560,246		1,038,055		1,255,052
Premises and equipment, net		172,097		176,574		180,132		184,950		191,423
Operating lease right-of-use assets		93,057		97,979		100,122		102,443		103,099
Mortgage servicing assets		104,951		95,101		103,314		100,825		156,539
Other assets		588,751		588,166		529,438		518,899		624,235
Goodwill		267,447		267,447		267,447		267,447		267,447
Other intangible assets, net		9,078		9,772		10,544		11,317		12,209
Total assets	$	16,396,858	$	17,138,341	$	17,029,087	$	16,259,282	$	16,615,291

Deposits:
Noninterest-bearing	$	3,200,247	$	3,451,438	$	3,807,878	$	3,968,862	$	4,546,816
Interest-bearing		7,902,850		7,712,739		7,289,269		7,346,887		6,805,198
Total deposits		11,103,097		11,164,177		11,097,147		11,315,749		11,352,014
Broker-dealer and clearing organization payables		1,368,064		1,306,646		1,383,317		966,470		1,176,156
Short-term borrowings		882,999		1,628,637		1,572,794		970,056		942,309
Securities sold, not yet purchased, at fair value		51,527		74,761		51,497		53,023		99,515
Notes payable		347,020		364,531		376,410		346,654		390,354
Operating lease liabilities		114,334		119,999		122,878		126,759		120,635
Other liabilities		422,955		389,336		341,246		417,042		475,425
Total liabilities		14,289,996		15,048,087		14,945,289		14,195,753		14,556,408

Common stock		652		651		650		647		646
Additional paid-in capital		1,052,867		1,050,191		1,044,774		1,046,331		1,043,605
Accumulated other comprehensive loss		(145,083)		(131,718)		(125,461)		(133,531)		(119,864)
Retained earnings		1,171,250		1,144,624		1,136,901		1,123,636		1,107,586
Deferred compensation employee stock trust, net		340		450		446		481		479
Employee stock trust		(446)		(599)		(599)		(640)		(641)
Total Hilltop stockholders' equity		2,079,580		2,063,599		2,056,711		2,036,924		2,031,811
Noncontrolling interests		27,282		26,655		27,087		26,605		27,072
Total stockholders' equity		2,106,862		2,090,254		2,083,798		2,063,529		2,058,883
Total liabilities & stockholders' equity	$	16,396,858	$	17,138,341	$	17,029,087	$	16,259,282	$	16,615,291

(1)

At September 30, 2023, the amortized cost of the available for sale securities portfolio was $1,606,340, while the fair value of the held to maturity securities portfolio was $703,366.


	Three Months Ended
Consolidated Income Statements	September 30,		June 30,		March 31,		December 31,		September 30,
(in 000's, except per share data)	2023		2023		2023		2022		2022
Interest income:
Loans, including fees	$	142,402	$	138,397	$	123,379	$	117,906	$	109,165
Securities borrowed		17,683		18,515		17,068		14,162		10,938
Securities:
Taxable		27,166		26,719		25,602		23,293		19,642
Tax-exempt		2,464		2,566		3,188		3,002		2,451
Other		27,040		27,229		22,190		21,611		14,276
Total interest income		216,755		213,426		191,427		179,974		156,472

Interest expense:
Deposits		64,290		54,726		35,824		28,238		12,525
Securities loaned		16,169		16,413		15,346		13,179		9,407
Short-term borrowings		14,212		17,706		12,444		10,278		5,550
Notes payable		4,026		3,973		3,853		3,988		3,907
Other		2,408		2,342		2,255		849		1,597
Total interest expense		101,105		95,160		69,722		56,532		32,986

Net interest income		115,650		118,266		121,705		123,442		123,486
Provision for (reversal of) credit losses		(40)		14,836		2,331		3,638		(780)
Net interest income after provision for (reversal of) credit losses		115,690		103,430		119,374		119,804		124,266

Noninterest income:
Net gains from sale of loans and other mortgage production income		47,262		48,535		39,966		35,949		57,998
Mortgage loan origination fees		41,478		41,440		28,777		35,198		39,960
Securities commissions and fees		28,044		29,606		31,223		33,143		34,076
Investment and securities advisory fees and commissions		39,662		32,037		26,848		30,661		35,031
Other		40,403		39,034		35,680		34,833		39,910
Total noninterest income		196,849		190,652		162,494		169,784		206,975

Noninterest expense:
Employees' compensation and benefits		173,195		176,908		167,817		167,892		200,450
Occupancy and equipment, net		21,912		23,025		22,865		23,077		25,041
Professional services		12,639		12,594		10,697		11,555		10,631
Other		52,271		54,450		49,091		50,844		52,616
Total noninterest expense		260,017		266,977		250,470		253,368		288,738

Income before income taxes		52,522		27,105		31,398		36,220		42,503
Income tax expense		13,211		7,167		3,630		9,642		9,249
Net income		39,311		19,938		27,768		26,578		33,254
Less: Net income attributable to noncontrolling interest		2,269		1,805		1,968		1,022		1,186
Income attributable to Hilltop	$	37,042	$	18,133	$	25,800	$	25,556	$	32,068

Earnings per common share:
Basic	$	0.57	$	0.28	$	0.40	$	0.40	$	0.50
Diluted	$	0.57	$	0.28	$	0.40	$	0.39	$	0.50

Cash dividends declared per common share	$	0.16	$	0.16	$	0.16	$	0.15	$	0.15

Weighted average shares outstanding:
Basic		65,106		65,025		64,901		64,602		64,552
Diluted		65,108		65,054		64,954		64,779		64,669


	Three Months Ended September 30, 2023
Segment Results					Mortgage				All Other and		Hilltop
(in 000's)	Banking		Broker-Dealer		Origination		Corporate		Eliminations		Consolidated
Net interest income (expense)	$	99,047	$	12,215	$	(5,482)	$	(3,175)	$	13,045	$	115,650
Provision for (reversal of) credit losses		675		(715)		—		—		—		(40)
Noninterest income		11,668		106,488		88,747		3,159		(13,213)		196,849
Noninterest expense		56,887		97,865		91,505		13,937		(177)		260,017
Income (loss) before taxes	$	53,153	$	21,553	$	(8,240)	$	(13,953)	$	9	$	52,522


	Nine Months Ended September 30, 2023
Segment Results					Mortgage				All Other and		Hilltop
(in 000's)	Banking		Broker-Dealer		Origination		Corporate		Eliminations		Consolidated
Net interest income (expense)	$	304,804	$	39,279	$	(15,590)	$	(9,976)	$	37,105	$	355,622
Provision for (reversal of) credit losses		17,175		(48)		—		—		—		17,127
Noninterest income		34,046		297,164		247,655		8,944		(37,815)		549,994
Noninterest expense		170,450		283,063		278,918		45,750		(717)		777,464
Income (loss) before taxes	$	151,225	$	53,428	$	(46,853)	$	(46,782)	$	7	$	111,025


	Three Months Ended
	September 30,		June 30,		March 31,		December 31,		September 30,
Selected Financial Data	2023		2023		2023		2022		2022

Hilltop Consolidated:
Return on average stockholders' equity		7.11%		3.53%		5.12%		4.99%		6.26%
Return on average assets		0.94%		0.47%		0.69%		0.63%		0.79%
Net interest margin ⁽¹⁾		3.02%		3.03%		3.28%		3.23%		3.19%
Net interest margin (taxable equivalent) ⁽²⁾:
As reported		3.04%		3.03%		3.28%		3.24%		3.20%
Impact of purchase accounting		7 bps		9 bps		6 bps		7 bps		8 bps
Book value per common share ($)		31.91		31.71		31.63		31.49		31.46
Shares outstanding, end of period (000's)		65,170		65,071		65,023		64,685		64,591
Dividend payout ratio ⁽³⁾		28.12%		57.37%		40.25%		37.92%		30.19%

Banking Segment:
Net interest margin ⁽¹⁾		3.08%		3.11%		3.40%		3.42%		3.42%
Net interest margin (taxable equivalent)⁽²⁾:
As reported		3.09%		3.11%		3.41%		3.43%		3.43%
Impact of purchase accounting		8 bps		11 bps		7 bps		8 bps		10 bps
Accretion of discount on loans ($000's)		2,226		3,334		1,870		2,173		2,858
Net recoveries (charge-offs) ($000's)		1,556		(2,884)		(419)		21		(2,735)
Return on average assets		1.20%		0.89%		1.44%		1.31%		1.41%
Fee income ratio		10.5%		10.0%		9.6%		9.8%		9.9%
Efficiency ratio		51.4%		51.2%		48.4%		48.9%		48.9%
Employees' compensation and benefits ($000's)		30,641		30,603		32,681		34,526		35,934

Broker-Dealer Segment:
Net revenue ($000's) ⁽⁴⁾		118,703		113,241		104,498		106,919		114,184
Employees' compensation and benefits ($000's)		69,930		65,290		62,429		60,552		70,274
Variable compensation expense ($000's)		39,929		34,798		30,821		32,042		42,567
Compensation as a % of net revenue		58.9%		57.7%		59.7%		56.6%		61.5%
Pre-tax margin ⁽⁵⁾		18.2%		16.3%		12.8%		18.5%		15.3%

Mortgage Origination Segment:
Mortgage loan originations - volume ($000's):
Home purchases		2,091,444		2,301,007		1,607,330		1,895,731		2,832,136
Refinancings		152,257		150,643		125,423		147,511		211,075
Total mortgage loan originations - volume		2,243,701		2,451,650		1,732,753		2,043,242		3,043,211
Mortgage loan sales - volume ($000's)		2,395,357		2,115,706		1,661,521		2,038,990		3,419,950
Net gains from mortgage loan sales (basis points):
Loans sold to third parties		199		207		193		211		227
Impact of loans retained by banking segment		(1)		(6)		(7)		(19)		(9)
As reported		198		201		186		192		218
Mortgage servicing rights asset ($000's) ⁽⁶⁾		104,951		95,101		103,314		100,825		156,539
Employees' compensation and benefits ($000's)		64,016		70,982		62,355		64,940		86,079
Variable compensation expense ($000's)		33,070		36,249		25,573		26,724		44,312

(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 $0.6 million, $0.1 million, $0.1 million, $0.3 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.


	September 30,		June 30,		March 31,		December 31,		September 30,
Capital Ratios	2023		2023		2023		2022		2022
Tier 1 capital (to average assets):
PlainsCapital		10.62%		10.28%		10.69%		10.26%		10.29%
Hilltop		11.92%		11.47%		11.82%		11.47%		11.41%
Common equity Tier 1 capital (to risk-weighted assets):
PlainsCapital		15.31%		14.48%		14.97%		14.98%		14.68%
Hilltop		18.60%		17.61%		17.99%		18.23%		17.45%
Tier 1 capital (to risk-weighted assets):
PlainsCapital		15.31%		14.48%		14.97%		14.98%		14.68%
Hilltop		18.60%		17.61%		17.99%		18.23%		17.45%
Total capital (to risk-weighted assets):
PlainsCapital		16.45%		15.56%		15.94%		15.91%		15.54%
Hilltop		21.54%		20.41%		20.75%		20.98%		20.07%


	September 30,		June 30,		March 31,		December 31,		September 30,
Non-Performing Assets Portfolio Data	2023		2023		2023		2022		2022
Loans accounted for on a non-accrual basis ($000's):
Commercial real estate		7,339		3,552		1,973		4,269		4,735
Commercial and industrial		10,190		21,442		10,807		9,095		12,078
Construction and land development		760		593		199		198		1
1-4 family residential		13,202		13,360		14,387		15,941		16,968
Consumer		7		9		12		14		16
Broker-dealer		—		—		—		—		—
		31,498		38,956		27,378		29,517		33,798
Troubled debt restructurings included in accruing loans held for investment ($000's)⁽¹⁾		—		—		—		803		825
Non-performing loans ($000's) ⁽¹⁾		31,498		38,956		27,378		30,320		34,623

Non-performing loans as a % of total loans ($000's) ⁽¹⁾		0.34%		0.40%		0.30%		0.33%		0.39%

Other real estate owned ($000's)		5,386		3,481		3,202		2,325		1,637

Other repossessed assets ($000's)		—		—		—		—		—

Non-performing assets ($000's) ⁽¹⁾		36,884		42,437		30,580		32,645		36,260

Non-performing assets as a % of total assets ($000's) ⁽¹⁾		0.22%		0.25%		0.18%		0.20%		0.22%

Loans past due 90 days or more and still accruing ($000's) ⁽²⁾		106,346		130,036		114,523		92,099		96,532

(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 September 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	$	1,075,518	$	15,649	5.82	%	$	1,166,265	$	14,414	4.94	%
Loans held for investment, gross ⁽²⁾		7,972,604		126,753	6.31	%		7,911,833		94,751	4.75	%
Investment securities - taxable		2,690,977		27,166	4.04	%		2,883,412		19,642	2.72	%
Investment securities - non-taxable ⁽³⁾		315,294		3,069	3.89	%		312,312		2,817	3.61	%
Federal funds sold and securities purchased under agreements to resell		142,324		2,313	6.45	%		137,728		1,309	3.77	%
Interest-bearing deposits in other financial institutions		1,550,991		20,320	5.20	%		1,780,220		9,542	2.13	%
Securities borrowed		1,371,625		17,683	5.04	%		1,116,837		10,938	3.83	%
Other		69,827		4,407	25.04	%		56,331		3,425	24.12	%
Interest-earning assets, gross ⁽³⁾		15,189,160		217,360	5.68	%		15,364,938		156,838	4.05	%
Allowance for credit losses		(110,398)						(95,083)
Interest-earning assets, net		15,078,762						15,269,855
Noninterest-earning assets		1,448,834						1,399,228
Total assets	$	16,527,596					$	16,669,083

Liabilities and Stockholders' Equity
Interest-bearing liabilities
Interest-bearing deposits	$	7,893,384	$	64,290	3.23	%	$	7,136,779	$	12,525	0.70	%
Securities loaned		1,303,883		16,169	4.92	%		980,530		9,407	3.81	%
Notes payable and other borrowings		1,527,371		20,646	5.36	%		1,262,985		11,054	3.47	%
Total interest-bearing liabilities		10,724,638		101,105	3.74	%		9,380,294		32,986	1.40	%
Noninterest-bearing liabilities
Noninterest-bearing deposits		3,347,752						4,543,067
Other liabilities		362,133						685,843
Total liabilities		14,434,523						14,609,204
Stockholders’ equity		2,066,564						2,032,717
Noncontrolling interest		26,509						27,162
Total liabilities and stockholders' equity	$	16,527,596					$	16,669,083

Net interest income ⁽³⁾			$	116,255					$	123,852
Net interest spread ⁽³⁾					1.94	%					2.65	%
Net interest margin ⁽³⁾					3.04	%					3.20	%

(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 $0.6 million and $0.4 million for the three months ended September 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, October 20, 2023. Hilltop President and CEO Jeremy B. Ford and Hilltop CFO William B. Furr will review third quarter 2023 financial results. Interested parties can access the conference call by dialing 1-888-259-6580 (North America) and then using the access code 31393751. 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 September 30, 2023, Hilltop employed approximately 3,900 people and operated approximately 336 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 legal, reputational and financial 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 and (vi) disruptions to the economy and the U.S. banking system caused by bank failures during early 2023, 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. 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.

Source: Hilltop Holdings Inc.

Document and Entity Information	Oct. 19, 2023
Document and Entity Information [Abstract]
Document Type	8-K
Document Period End Date	Oct. 19, 2023
Entity File Number	1-31987
Entity Registrant Name	Hilltop Holdings Inc.
Entity Incorporation, State or Country Code	MD
Entity Tax Identification Number	84-1477939
Entity Address, Address Line One	6565 Hillcrest Avenue
Entity Address, City or Town	Dallas
Entity Address, State or Province	TX
Entity Address, Postal Zip Code	75205
City Area Code	214
Local Phone Number	855-2177
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Common Stock, par value $0.01 per share
Trading Symbol	HTH
Security Exchange Name	NYSE
Entity Emerging Growth Company	false
Entity Central Index Key	0001265131
Amendment Flag	false

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