Hilltop Holdings Inc. Announces Financial Results for First Quarter 2018

Company Release - 4/26/2018 5:10 PM ET

DALLAS--(BUSINESS WIRE)-- Hilltop Holdings Inc. (NYSE: HTH) (“Hilltop”) today announced financial results for the first quarter of 2018. Hilltop produced income of $24.4 million, or $0.25 per diluted share, for the first quarter of 2018, compared to $26.4 million, or $0.27 per diluted share, for the first quarter of 2017.

On February 14, 2018, Hilltop announced that it had entered into a definitive agreement to acquire privately-held, Houston-based The Bank of River Oaks (“BORO”) in an all-cash transaction. Under the terms of the definitive agreement, Hilltop has agreed to pay cash in the aggregate amount of $85 million to the shareholders and option holders of BORO. As of December 31, 2018, BORO had unaudited total assets, gross loans and deposits of approximately $454 million, $344 million and $406 million, respectively. The transaction is subject to customary closing conditions, including regulatory approvals and approval by shareholders of BORO, and is expected to close during the third quarter of 2018.

Hilltop also announced that its Board of Directors declared a quarterly cash dividend of $0.07 per common share, payable on May 31, 2018, to all common stockholders of record as of the close of business on May 15, 2018. Additionally, pursuant to the stock repurchase program authorized by the Hilltop Board of Directors in January 2018, Hilltop paid $1.7 million to repurchase 68,307 shares at an average price of $24.94 during the first quarter of 2018. These shares were returned to the pool of authorized but unissued shares of common stock.

Jeremy Ford, Co-CEO of Hilltop, said, “Our diversified business model with PlainsCapital Bank as the cornerstone continued to demonstrate its resilience, as the bank generated strong earnings and the broker-dealer’s clearing and retail businesses benefited from higher short-term rates, while our mortgage-related businesses endured a challenging environment. We are excited about the pending acquisition of The Bank of River Oaks and accelerating our efforts in the robust Houston market, as we remain focused on building our core banking franchise across Texas.”

Alan White, Co-CEO of Hilltop, added, “Our markets are increasingly competitive, so our teams are focused on growing revenue by providing best-in-class service to our valued customers. PlainsCapital Bank had a positive first quarter, generating solid net interest income growth while maintaining very strong credit quality. National Lloyds’ earnings were driven by lower storm losses. HilltopSecurities’ fixed income portfolio was adversely impacted by volatility in long-term rates, and PrimeLending experienced tighter gain on sale margins.”

First Quarter 2018 Highlights for Hilltop:

  • Hilltop’s annualized return on average assets and return on average equity for the first quarter of 2018 were 0.77% and 5.19%, respectively, compared to 0.88% and 5.73%, respectively, for the first quarter of 2017;
  • Hilltop’s total assets were $13.3 billion at March 31, 2018, compared to $13.4 billion at December 31, 2017;
  • Hilltop’s common equity increased by $10.9 million from December 31, 2017 to $1.9 billion at March 31, 2018;
  • Non-covered loans1 held for investment, net of allowance for loan losses, decreased by 0.4% to $5.6 billion and covered loans2, net of allowance for loan losses, decreased by 6.5% to $167.8 million at March 31, 2018 compared to December 31, 2017;
  • Non-covered non-performing loans decreased to $39.4 million, or 0.52% of total non-covered loans, at March 31, 2018, compared to $40.5 million, or 0.51% of total non-covered loans, at December 31, 2017;
  • Energy classified and criticized loans were $28.5 million at March 31, 2018, a slight decrease from $28.6 million at December 31, 2017;
  • Loans held for sale decreased by 17.8% from December 31, 2017 to $1.4 billion at March 31, 2018;
  • Total deposits were $8.0 billion at both March 31, 2018 and December 31, 2017;
  • Hilltop maintained strong capital levels with a Tier 1 Leverage Ratio3 of 13.26% and a Common Equity Tier 1 Capital Ratio of 18.60% at March 31, 2018;
  • Hilltop’s net interest margin4 decreased to 3.52% for the first quarter of 2018, compared to 3.57% in the fourth quarter of 2017;
  • The provision (recovery) for loan losses was ($1.8) million during the first quarter of 2018, compared to $5.5 million in the fourth quarter of 2017;
  • For the first quarter of 2018, noninterest income was $235.1 million, compared to $271.4 million in the first quarter of 2017, a 13.4% decrease; and
  • For the first quarter of 2018, noninterest expense was $308.2 million, compared to $320.5 million in the first quarter of 2017, a 3.8% decrease; and
  • The Company’s effective tax rate decreased to 23.3% during the first quarter of 2018, compared to 36.4% during the first quarter of 2017, primarily due to the enactment of the Tax Cuts and Jobs Act of 2017 (“Tax Legislation”).
____________________
1   “Non-covered loans” exclude broker-dealer margin loans.
2 “Covered loans” refer to loans acquired in the FNB Transaction that are subject to loss-share agreements with the FDIC.
3 Based on the end of period Tier 1 capital divided by total average assets during 2018, excluding goodwill and intangible assets.
4 Net interest margin is defined as net interest income divided by average interest-earning assets.
           
Consolidated Balance Sheets March 31, December 31, September 30, June 30, March 31,
(in 000's)     2018       2017       2017       2017       2017  
Cash and due from banks $ 470,127 $ 486,977 $ 354,569 $ 405,938 $ 545,928
Federal funds sold 400 405 400 388 24,404
Securities purchased under agreements to resell 244,978 186,537 134,654 125,188 113,228
Assets segregated for regulatory purposes 198,170 186,578 207,336 167,565 166,395
Securities:
Trading debt, at fair value 756,151 730,685 676,411 471,485 373,300
Available for sale debt, at fair value 806,583 744,319 765,542 763,206 755,546
Held to maturity debt, at amortized cost 356,452 355,849 347,048 339,344 317,094
Equity, at fair value   20,876     21,241     20,983     20,503     20,263  
1,940,062 1,852,094 1,809,984 1,594,538 1,466,203
Loans held for sale 1,409,634 1,715,357 1,939,321 2,000,257 1,329,493
Non-covered loans, net of unearned income 6,216,809 6,273,669 6,148,813 6,118,211 5,783,853
Allowance for non-covered loan losses   (60,371 )   (60,957 )   (58,779 )   (59,208 )   (55,157 )
Non-covered loans, net 6,156,438 6,212,712 6,090,034 6,059,003 5,728,696
 
Covered loans, net of allowance for covered loan losses 167,781 179,400 188,269 205,877 234,681
Broker-dealer and clearing organization receivables 1,660,720 1,464,378 1,672,123 1,552,525 1,574,031
Premises and equipment, net 173,637 177,577 176,281 183,994 184,091
FDIC indemnification asset 25,458 29,340 33,143 40,304 47,940
Covered other real estate owned 35,777 36,744 40,343 42,304 45,374
Other assets 576,567 549,447 596,095 618,368 583,554
Goodwill 251,808 251,808 251,808 251,808 251,808
Other intangible assets, net   34,569     36,432     38,440     40,516     42,601  
Total assets $ 13,346,126   $ 13,365,786   $ 13,532,800   $ 13,288,573   $ 12,338,427  
 
Deposits:
Non-interest bearing $ 2,565,825 $ 2,411,849 $ 2,279,633 $ 2,251,208 $ 2,272,905
Interest bearing   5,393,897     5,566,270     5,383,814     5,323,414     5,056,957  
Total deposits 7,959,722 7,978,119 7,663,447 7,574,622 7,329,862
Broker-dealer and clearing organization payables 1,504,172 1,287,563 1,517,698 1,395,314 1,437,548
Short-term borrowings 1,064,325 1,206,424 1,477,201 1,515,069 753,777
Securities sold, not yet purchased, at fair value 255,551 232,821 173,509 149,869 144,193
Notes payable 202,700 208,809 300,196 300,283 324,701
Junior subordinated debentures 67,012 67,012 67,012 67,012 67,012
Other liabilities   367,188     470,231     424,381     393,351     392,025  
Total liabilities 11,420,670 11,450,979 11,623,444 11,395,520 10,449,118
 
Common stock 960 960 959 963 984
Additional paid-in capital 1,526,867 1,526,369 1,525,169 1,529,903 1,570,329
Accumulated other comprehensive income (loss) (9,698 ) (394 ) 2,585 2,112 897
Retained earnings 404,260 384,545 376,873 356,564 313,197
Deferred compensation employee stock trust, net 857 848 840 845 893
Employee stock trust   (254 )   (247 )   (241 )   (248 )   (300 )
Total Hilltop stockholders' equity 1,922,992 1,912,081 1,906,185 1,890,139 1,886,000
Noncontrolling interests   2,464     2,726     3,171     2,914     3,309  
Total stockholders' equity   1,925,456     1,914,807     1,909,356     1,893,053     1,889,309  
Total liabilities & stockholders' equity $ 13,346,126   $ 13,365,786   $ 13,532,800   $ 13,288,573   $ 12,338,427  
           
Three Months Ended
Consolidated Income Statements March 31, December 31, September 30, June 30, March 31,
(in 000's, except per share data)     2018       2017     2017     2017     2017  
Interest income:
Loans, including fees $ 99,944 $ 105,658 $ 102,546 $ 113,793 $ 89,991
Securities borrowed 16,300 11,994 11,404 9,597 8,053
Securities:
Taxable 10,953 10,824 10,214 8,833 6,600
Tax-exempt 1,772 1,717 1,471 1,375 1,244
Other   4,391     3,472   3,309   2,708   2,353  
Total interest income 133,360 133,665 128,944 136,306 108,241
 
Interest expense:
Deposits 8,675 7,700 6,841 5,464 4,690
Securities loaned 13,739 9,581 8,935 7,481 6,340
Short-term borrowings 4,043 4,118 4,567 3,648 1,418
Notes payable 2,497 2,611 2,680 2,826 2,814
Junior subordinated debentures 822 787 774 744 711
Other   164     176   167   167   168  
Total interest expense 29,940 24,973 23,964 20,330 16,141
 
Net interest income 103,420 108,692 104,980 115,976 92,100
Provision (recovery) for loan losses   (1,807 )   5,453   1,260   5,853   1,705  
Net interest income after provision (recovery) for loan losses 105,227 103,239 103,720 110,123 90,395
 
Noninterest income:
Net gains from sale of loans and other mortgage production income 105,767 122,132 138,498 153,688 124,150
Mortgage loan origination fees 20,626 23,156 25,256 25,976 19,556
Securities commissions and fees 39,383 40,868 38,735 37,804 39,057
Investment and securities advisory fees and commissions 17,625 36,561 25,620 25,537 22,202
Net insurance premiums earned 34,315 35,645 34,493 36,020 36,140
Other   17,427     32,094   35,875   65,667   30,334  
Total noninterest income 235,143 290,456 298,477 344,692 271,439
 
Noninterest expense:
Employees' compensation and benefits 182,600 205,642 209,747 214,719 186,886
Occupancy and equipment, net 27,830 29,658 29,073 27,919 27,293
Professional services 24,704 24,220 25,560 26,696 25,045
Loss and loss adjustment expenses 15,532 8,583 31,234 33,184 21,700
Other   57,536     60,567   58,228   63,733   59,568  
Total noninterest expense 308,202 328,670 353,842 366,251 320,492
 
Income before income taxes 32,168 65,025 48,355 88,564 41,342
Income tax expense   7,488     51,350   18,003   25,754   15,035  
Net income 24,680 13,675 30,352 62,810 26,307
Less: Net income (loss) attributable to noncontrolling interest   239     247   146   334   (127 )
Income attributable to Hilltop $ 24,441   $ 13,428 $ 30,206 $ 62,476 $ 26,434  
 
Earnings per common share:
Basic $ 0.25 $ 0.14 $ 0.31 $ 0.64 $ 0.27
Diluted $ 0.25 $ 0.14 $ 0.31 $ 0.63 $ 0.27
 
Cash dividends declared per common share $ 0.07 $ 0.06 $ 0.06 $ 0.06 $ 0.06
 
Weighted average shares outstanding:
Basic 95,985 95,903 96,096 98,154 98,441
Diluted 96,146 96,080 96,306 98,414 98,757
               
Three Months Ended March 31, 2018
Segment Results Mortgage All Other and Hilltop
(in 000s) Banking Broker-Dealer Origination Insurance Corporate Eliminations Consolidated
Net interest income (expense) $ 86,638 $ 12,550 $ 941 $ 787 $ (2,091 ) $ 4,595 $ 103,420
Provision (recovery) for loan losses (1,531 ) (276 ) - - - - (1,807 )
Noninterest income 10,180 68,547 127,102 35,018 (712 ) (4,992 ) 235,143
Noninterest expense   59,370     77,776     130,704     31,013   9,403     (64 )   308,202  
Income (loss) before income taxes $ 38,979   $ 3,597   $ (2,661 ) $ 4,792 $ (12,206 ) $ (333 ) $ 32,168  
           
Three Months Ended
March 31, December 31, September 30, June 30, March 31,
Selected Financial Data 2018   2017   2017   2017   2017  
 

Hilltop Consolidated:

Return on average stockholders' equity (1) 5.19 % 2.78 % 6.32 % 13.24 % 5.73 %
Return on average assets (1) 0.77 % 0.41 % 0.90 % 1.94 % 0.88 %
Net interest margin (2) (3): 3.52 % 3.57 % 3.44 % 3.98 % 3.47 %
Net interest margin (taxable equivalent) (3) (4):
As reported 3.53 % 3.59 % 3.46 % 3.99 % 3.49 %
Impact of purchase accounting 36 bps 43 bps 37 bps 82 bps 49 bps
Book value per common share ($) 20.02 19.92 19.88 19.62 19.17
Shares outstanding, end of period (000's) 96,048 95,982 95,904 96,333 98,407
Dividend payout ratio (1) (5) 27.49 % 42.86 % 19.09 % 9.43 % 22.30 %
 

Banking Segment:

Net interest margin (2): 4.15 % 4.23 % 4.03 % 4.80 % 4.21 %
Net interest margin (taxable equivalent) (4):
As reported 4.16 % 4.24 % 4.05 % 4.81 % 4.23 %
Impact of purchase accounting 51 bps 60 bps 51 bps 112 bps 67 bps
Accretion of discount on loans ($000's) 9,867 12,642 10,541 23,164 12,098
Non-covered net charge-offs (recoveries) ($000's) (1,312 ) 4,635 908 842 238
Return on average assets (1) 1.31 % -0.08 % 0.94 % 1.63 % 0.94 %
Fee income ratio 10.51 % 10.22 % 11.33 % 19.97 % 13.13 %
Efficiency ratio 61.32 % 60.18 % 62.29 % 48.96 % 64.36 %
Employees' compensation and benefits ($000's) 30,811 31,159 30,810 31,790 31,512
 

Broker-Dealer Segment:

Net revenue (6) 81,097 114,326 103,633 103,159 91,039
Employees' compensation and benefits ($000's) 52,265 70,169 60,365 62,840 57,240
Variable compensation expense ($000's) 39,383 41,239 35,085 36,556 30,808
Compensation as a % of net revenue 64.4 % 61.4 % 58.2 % 60.9 % 62.9 %
Pre-tax margin 4.44 % 16.73 % 19.49 % 15.33 % 10.45 %
 

Mortgage Origination Segment:

Mortgage loan originations - volume ($000's):
Home purchases 2,358,692 2,870,864 3,332,441 3,502,128 2,269,138
Refinancings 601,105     732,129     640,064     555,956     555,193  
Total mortgage loan originations - volume 2,959,797 3,602,993 3,972,505 4,058,084 2,824,331
Mortgage loan sales - volume ($000's) 3,185,438 3,791,638 4,002,195 3,385,260 3,275,167
Mortgage servicing rights asset ($000's) (7) 63,957 54,714 47,766 43,580 45,573
Employees' compensation and benefits ($000's) 91,059 96,257 111,133 115,189 89,958
Variable compensation expense ($000's) (8) 46,292 57,434 64,956 69,445 44,841
 

Insurance Segment:

Loss and LAE ratio 45.3 % 24.1 % 90.6 % 92.1 % 60.0 %
Expense ratio 39.9 %   41.0 %   40.4 %   39.7 %   38.4 %
Combined ratio 85.2 % 65.1 % 131.0 % 131.8 % 98.4 %
Employees' compensation and benefits ($000's) 3,255 3,418 2,578 2,786 2,780

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(1)   Noted measures during the three months ended December 31, 2017 include estimated non-cash, non-recurring charges to Hilltop Consolidated and Banking Segment results of $28.4 million and $25.7 million, respectively, primarily attributable to the revaluation of deferred tax assets as a result of the enactment of the Tax Legislation. Certain Tax Legislation amounts are considered reasonable estimates as of March 31, 2018 and could be adjusted during the measurement period, which will end in December 2018, as a result of further refinement of our calculations, changes in interpretations and assumptions made, guidance that may be issued and actions we may take as a result of Tax Legislation.
(2) Net interest margin is defined as net interest income divided by average interest-earning assets.
(3) Noted measures during the 2017 periods presented reflect certain category reclassifications within the detailed calculations to conform with the current period presentation.
(4) 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 the 2018 period and 35% federal income tax rate for the 2017 periods. 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. For the periods presented, the taxable equivalent adjustments to interest income for Hilltop Consolidated were $0.3 million, $0.6 million, $0.6 million, $0.5 million, and $0.5 million, respectively, and for the Banking Segment were $0.2 million, $0.4 million, $0.4 million, $0.4 million, and $0.4 million, respectively.
(5) Dividend payout ratio is defined as cash dividends declared per common share divided by basic earnings per common share.
(6) Net revenue is defined as the sum of total broker-dealer net interest income plus total broker-dealer noninterest income
(7) 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.
(8) Noted measures during the 2017 periods presented reflect certain category reclassifications that affect variable compensation expense to conform with the current period presentation.
 
           
March 31, December 31, September 30, June 30, March 31,
Capital Ratios 2018   2017   2017   2017   2017  
Tier 1 capital (to average assets):
PlainsCapital 13.01 % 12.32 % 12.18 % 12.11 % 13.09 %
Hilltop 13.26 % 12.94 % 12.87 % 13.07 % 13.98 %
Common equity Tier 1 capital (to risk-weighted assets):
PlainsCapital 15.39 % 14.47 % 14.44 % 13.95 % 15.50 %
Hilltop 18.60 % 17.71 % 17.66 % 17.53 % 19.03 %
Tier 1 capital (to risk-weighted assets):
PlainsCapital 15.39 % 14.47 % 14.44 % 13.95 % 15.50 %
Hilltop 19.11 % 18.24 % 18.20 % 18.07 % 19.62 %
Total capital (to risk-weighted assets):
PlainsCapital 16.25 % 15.29 % 15.23 % 14.72 % 16.30 %
Hilltop 19.63 % 18.78 % 18.71 % 18.57 % 20.12 %
           
March 31, December 31, September 30, June 30, March 31,
Non-Covered Non-Performing Loans Portfolio Data 2018     2017     2017     2017     2017  
 
Non-covered loans accounted for on a non-accrual basis ($000's):
Commercial and industrial 20,768 20,878 21,434 13,818 13,490
Real estate 17,971 18,978 17,996 14,877 14,437
Construction and land development 595 611 626 632 661
Consumer 52 56 63 208 223
Broker-dealer -     -     -     -     -  
39,386 40,523 40,119 29,535 28,811
 
Non-covered non-performing loans as a % of total non-covered loans 0.52 % 0.51 % 0.50 % 0.36 % 0.41 %
 
Non-covered other real estate owned ($000's) 2,577 3,883 4,827 4,591 4,556
 
Other repossessed assets ($000's) 246 323 437 723 681
 
Non-covered non-performing assets ($000's) 42,209 44,729 45,383 34,849 34,048
 
Non-covered non-performing assets as a % of total assets 0.32 % 0.33 % 0.34 % 0.26 % 0.28 %
 
Non-covered non-PCI loans past due 90 days or more and still accruing ($000's) 77,590 85,113 45,134 48,757 42,767
 
Troubled debt restructurings included in accruing non-covered loans ($000's) 1,123 1,150 1,163 1,170 1,180
     
Three Months Ended March 31,
2018     2017  
Average   Interest   Annualized Average Interest   Annualized
Outstanding Earned or Yield or Outstanding Earned or Yield or
Net Interest Margin (Taxable Equivalent) Details Balance Paid Rate Balance Paid Rate
Assets
Interest-earning assets
Loans, gross (1) $ 7,603,001 $ 99,944 5.27 % $ 7,094,928 $ 89,991 5.08 %
Investment securities - taxable 1,613,608 10,928 2.71 % 1,088,010 6,576 2.43 %
Investment securities - non-taxable (2) 258,732 2,030 3.14 % 219,396 1,749 3.20 %
Federal funds sold and securities purchased
under agreements to resell 189,623 481 1.03 % 117,661 79 0.27 %
Interest-bearing deposits in other
financial institutions 632,727 2,478 1.59 % 675,083 1,274 0.77 %
Securities borrowed 1,537,306 16,300 4.24 % 1,487,079 8,053 2.17 %
Other   70,854     1,452 8.27 %   91,298     1,024 4.51 %
Interest-earning assets, gross (2) 11,905,851 133,613 4.50 % 10,773,455 108,746 4.04 %
Allowance for loan losses   (65,202 )   (55,630 )
Interest-earning assets, net 11,840,649 10,717,825
Noninterest-earning assets   1,228,058     1,395,563  
Total assets $ 13,068,707   $ 12,113,388  
 
Liabilities and Stockholders' Equity
Interest-bearing liabilities
Interest-bearing deposits $ 5,494,657 $ 8,675 0.64 % $ 4,936,895 $ 4,690 0.39 %
Securities loaned 1,365,081 13,739 4.08 % 1,361,759 6,340 1.89 %
Notes payable and other borrowings   1,195,993     7,526 2.54 %   1,049,517     5,111 1.96 %
Total interest-bearing liabilities 8,055,731 29,940 1.50 % 7,348,171 16,141 0.89 %
Noninterest-bearing liabilities
Noninterest-bearing deposits 2,419,725 2,234,789
Other liabilities   680,543     656,854  
Total liabilities 11,155,999 10,239,814
Stockholders' equity 1,911,160 1,870,441
Noncontrolling interest   1,548     3,133  
Total liabilities and stockholders' equity $ 13,068,707   $ 12,113,388  
   
Net interest income (2) $ 103,673 $ 92,605
Net interest spread (2) 2.99 % 3.16 %
Net interest margin (2) 3.53 % 3.49 %

____________________

(1)   Average balance includes non-accrual loans.
(2) Presented on a taxable equivalent basis with annualized taxable equivalent adjustments based on a 21% federal income tax rate for the three months ended March 31, 2018 and a 35% federal income tax rate for the three months ended March 31, 2017. The adjustment to interest income was $0.3 million and $0.5 million for the three months ended March 31, 2018 and 2017, respectively.
 

Conference Call Information

Hilltop will host a live webcast and conference call at 8:00 AM Central (9:00 AM Eastern) on Friday, April 27, 2018. Hilltop Co-CEOs Jeremy B. Ford and Alan B. White and other key management members will review first quarter 2018 financial results. Interested parties can access the conference call by dialing 1-877-508-9457 (domestic) or 1-412-317-0789 (international). 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 Hilltop Securities Independent Network Inc., provide a full complement of securities brokerage, institutional and investment banking services in addition to clearing services and retail financial advisory. Through Hilltop Holdings’ other wholly owned subsidiary, National Lloyds Corporation, it provides property and casualty insurance through two insurance companies, National Lloyds Insurance Company and American Summit Insurance Company. At March 31, 2018, Hilltop employed approximately 5,400 people and operated approximately 475 locations in 45 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, Nationallloydsinsurance.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, expected tax impacts, strategic acquisitions and other statements that are not statements of historical fact, and may be identified by words such as “anticipates,” “believes,” “could,” “estimates,” “expects,” “forecasts,” “goal,” “intends,” “may,” “might,” “plan,” “probable,” “projects,” “seeks,” “should,” “target,” “view” or “would” or the negative of these words and phrases or similar words or phrases. Factors that could cause our actual results to differ materially from those described in the forward-looking statements include, among others: (i) the possibility that any of the anticipated benefits of the proposed transaction with BORO will not be realized or will not be realized within the expected time period or that the transaction may be more expensive to complete than anticipated; (ii) the failure of the proposed transaction with BORO to close on the expected timeline or at all; and (iii) the ability to obtain regulatory approvals and meet other closing conditions to the acquisition of BORO, including approval by BORO shareholders on the expected terms and schedule. For a discussion of certain other factors that could cause our actual results to differ materially from those described in the forward-looking statements, please see the risk factors discussed 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.

Hilltop Holdings Inc.
Isabell Novakov, 214-252-4029
inovakov@hilltop-holdings.com

Source: Hilltop Holdings Inc.