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): September 20, 2017
__________________________________________________________
VERITEX HOLDINGS, INC.
(Exact name of Registrant as specified in its charter)
__________________________________________________________
Texas | 001-36682 | 27-0973566 | ||
(State or other jurisdiction of incorporation or organization) | (Commission File Number) | (I.R.S. Employer Identification Number) | ||
8214 Westchester Drive, Suite 400
Dallas, Texas 75225
(Address of principal executive offices)
(972) 349-6200
(Registrant’s telephone number, including area code)
__________________________________________________________
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:
x Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company x
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. x
Item 7.01. Regulation FD Disclosure.
On September 20, 2017, C. Malcolm Holland, III, Chairman and Chief Executive Officer, and Noreen Skelly, Chief Financial Officer, of Veritex Holdings, Inc. (the “Company”) are presenting at the Stephens Bank CEO Forum. A copy of the materials for such presentation is attached as Exhibit 99.1 to this Current Report on Form 8-K.
This information in this Item 7.01 and in Exhibit 99.1 hereto is being furnished, and shall not be deemed to be “filed,” with the Securities and Exchange Commission (the “SEC”). The information in Exhibit 99.1 shall not be incorporated by reference into any filing of the registrant with the SEC, whether made before or after the date hereof, regardless of any general incorporation language in such filings.
Item 8.01 Other Events
The portions of the presentation materials that relate solely to the proposed merger between Freedom Merger Sub, Inc., a Texas corporation and wholly-owned subsidiary of the Company, and Liberty Bancshares, Inc. (“Liberty”), a Texas corporation and the parent holding company of Liberty Bank, are being filed herewith as Exhibit 99.1 to this Current Report on Form 8-K in compliance with Rule 425 of the Securities Act of 1933, as amended.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
Exhibit No. | Description of Exhibit | |
99.1 | Presentation materials for the Stephens Bank CEO Forum, dated September 18-20, 2017. | |
Cautionary Statement Regarding Forward-Looking Statements
The information presented herein and in other documents filed with or furnished to the SEC, in press releases or other public shareholder communications, or in oral statements made with the approval of an authorized executive officer contains forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 giving the Company’s and Liberty’s expectations or predictions of future financial or business performance or conditions. Forward-looking statements are typically identified by words such as “believe,” “expect,” “anticipate,” “intend,” “target,” “estimate,” “continue,” “positions,” “prospects” or “potential,” by future conditional verbs such as “will,” “would,” “should,” “could” or “may”, or by variations of such words or by similar expressions. These forward-looking statements are subject to numerous assumptions, risks and uncertainties which change over time. Forward-looking statements speak only as of the date they are made and we assume no duty to update forward-looking statements.
You are cautioned not to place undue reliance on any forward-looking statements, which speak only as of the date such statements are made. These statements may relate to future financial performance, strategic plans or objectives, revenues or earnings projections, or other financial information. By their nature, these statements are subject to numerous uncertainties that could cause actual results to differ materially from those anticipated in the statements. Statements about the expected timing, completion and effects of the proposed transactions and all other statements in this communication other than historical facts constitute forward-looking statements.
In addition to factors previously disclosed in the Company’s reports filed with the SEC and those identified elsewhere in this communication, the following factors among others, could cause actual results to differ materially from forward-looking statements: delay in closing the Liberty merger; difficulties and delays in integrating the Company and Liberty businesses or fully realizing cost savings and other benefits; business disruption following the proposed transaction; changes in asset quality and credit risk; the inability to sustain revenue and earnings growth; changes in interest rates and capital markets; inflation; customer borrowing, repayment, investment and deposit practices; customer disintermediation; the introduction, withdrawal, success and timing of business initiatives; competitive conditions; the inability to realize cost savings or revenues or to implement integration plans and other consequences associated with mergers, acquisitions and divestitures; economic conditions; and the impact, extent and timing of technological changes, capital management activities, and other actions of the Board of Governors of the Federal Reserve System and legislative and regulatory actions and reforms.
2
Additional Information About the Proposed Transaction and Where to Find It
This communication is being made in respect of the proposed merger transaction involving the Company and Liberty. This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities.
Investors and security holders are urged to carefully review and consider the Company’s public filings with the SEC, including but not limited to its Annual Reports on Form 10-K, its proxy statements, its Current Reports on Form 8-K and its Quarterly Reports on Form 10-Q. The documents filed by the Company with the SEC may be obtained free of charge from www.veritexbank.com under the Investor Relations tab or at the SEC’s website at www.sec.gov. Alternatively, these documents, when available, can be obtained free of charge from the Company upon written request to Veritex Holdings, Inc., Attn: Investor Relations, 8214 Westchester Drive, Suite 400, Dallas, Texas 75225 or by calling (972) 349-6200.
In connection with the proposed merger, the Company will file a registration statement on Form S-4 with the SEC which includes a proxy statement of Liberty and a prospectus of the Company, which will be sent to shareholders of Liberty, and will file other documents regarding the proposed merger with the SEC. Before making any investment decision, investors and security holders of Liberty are urged to carefully read the entire registration statement and proxy statement/prospectus, as well as any amendments or supplements to these documents and any other relevant documents filed with the SEC, because they will contain important information about the proposed merger. Investors and security holders will be able to obtain the registration statement and the proxy statement/prospectus free of charge from the SEC’s website or from the Company by writing to the address provided above.
The Company and Liberty and their respective directors and executive officers may be deemed to be participants in the solicitation of proxies from the shareholders of Liberty in connection with the proposed merger. Information about the Company’s participants may be found in the definitive proxy statement filed with the SEC on April 10, 2017. The definitive proxy statement can be obtained free of charge from the sources indicated above. Additional information regarding the interests of such participants will be included in the proxy statement/prospectus and will be included in other relevant documents regarding the proposed merger transaction filed with the SEC when they become available, copies of which may also be obtained free of charge from the sources indicated above.
3
SIGNATURE
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.
Veritex Holdings, Inc. | ||
By: | /s/ C. Malcolm Holland, III | |
C. Malcolm Holland, III | ||
Chairman and Chief Executive Officer | ||
Date: | September 20, 2017 | |
4
EXHIBIT INDEX
Exhibit No. | Description of Exhibit | |
Presentation materials for the Stephens Bank CEO Forum, dated September 18-20, 2017. | ||
5
V E R I T E X
Stephens Bank CEO Forum
September 20, 2017
2
Safe Harbor Statement
ABOUT VERITEX HOLDINGS, INC.
Headquartered in Dallas, Texas, Veritex Holdings, Inc. (“VBTX”, “Veritex” or the “Company”) is a bank holding company that conducts banking activities
through its wholly-owned subsidiary, Veritex Community Bank, with locations throughout the Dallas Fort Worth metroplex and in the Houston and
Austin metropolitan area. Veritex Community Bank is a Texas state chartered bank regulated by the Texas Department of Banking and the Board of
Governors of the Federal Reserve System. For more information, visit www.veritexbank.com.
NO OFFER OR SOLICITATION
This communication does not constitute an offer to sell, a solicitation of an offer to sell, the solicitation or an offer to buy any securities or a solicitation
of any vote or approval. There will be no sale of securities in any jurisdiction in which such an offer, solicitation or sale would be unlawful prior to
registration or qualification under the securities laws of any such jurisdiction. No offer of securities shall be made except by means of a prospectus
meeting the requirement of Section 10 of the Securities Act of 1933, as amended.
ADDITIONAL INFORMATION ABOUT THE MERGER AND WHERE TO FIND IT
In connection with the proposed merger of Veritex and Liberty Bancshares, Inc. (“Liberty”), Veritex will file with the Securities and Exchange Commission
(the “SEC”) a registration statement on Form S-4 that will include a proxy statement of Liberty and a prospectus of Veritex, as well as other relevant
documents concerning the proposed merger. WE URGE INVESTORS AND SECURITY HOLDERS TO READ THE REGISTRATION STATEMENT ON FORM S-4
AND THE PROXY STATEMENT/PROSPECTUS INCLUDED WITHIN THE REGISTRATION STATEMENT ON FORM S-4 AS WELL AS ANY AMENDMENTS OR
SUPPLEMENTS TO THESE DOCUMENTS AND ANY OTHER RELEVANT DOCUMENTS TO BE FILED WITH THE SEC IN CONNECTION WITH THE MERGER
BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT VERITEX, SOVEREIGN AND THE MERGER. Investors and security holders will be able to
obtain free copies of the registration statement on Form S-4 and the related proxy statement/prospectus, when filed, as well as other documents filed
with the SEC by Veritex through the web site maintained by the SEC at www.sec.gov. Documents filed with the SEC by Veritex will also be available free
of charge by directing a written request to Veritex Holdings, Inc., 8214 Westchester Drive, Suite 400, Dallas, Texas 75225 Attn: Investor Relations.
Veritex’s telephone number is (972) 349-6200.
NON-GAAP FINANCIAL MEASURES
Veritex reports its results in accordance with United States generally accepted accounting principles (“GAAP”). However, management believes that
certain non-GAAP performance measures used in managing the business may provide meaningful information about underlying trends in its business.
Non-GAAP financial measures should be viewed in addition to, and not as an alternative for, Veritex’s reported results prepared in accordance with
GAAP. Please see Reconciliation of Non-GAAP Measures at the end of this presentation for a reconciliation to the nearest GAAP financial measure.
PARTICIPANTS IN THE TRANSACTION
Veritex, Liberty and certain of their respective directors and executive officers may be deemed to be participants in the solicitation of proxies from the
shareholders of Liberty in connection with the proposed merger. Certain information regarding the interests of these participants and a description of
their direct and indirect interests, by security holdings or otherwise, will be included in the proxy statement/prospectus regarding the proposed
transaction when it becomes available. Additional information about Veritex and its directors and officers may be found in the definitive proxy statement
of Veritex relating to its 2017 Annual Meeting of Stockholders filed with the SEC on April 10, 2017. The definitive proxy statement can be obtained free
of charge from the sources described above.
3
Forward Looking Statements
“Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995: This presentation may contain certain forward-looking statements
within the meaning of the securities laws that are based on various facts and derived utilizing important assumptions, current expectations, estimates
and projections about the Company and its subsidiaries. Forward-looking statements include information regarding the Company’s future financial
performance, business and growth strategy, projected plans and objectives, and related transactions, integration of the acquired businesses, ability to
recognize anticipated operational efficiencies, and other projections based on macroeconomic and industry trends, which are inherently unreliable due
to the multiple factors that impact economic trends, and any such variations may be material. Statements preceded by, followed by or that otherwise
include the words “believes,” “expects,” “anticipates,” “intends,” “projects,” “estimates,” “plans” and similar expressions or future or conditional verbs
such as “will,” “should,” “would,” “may” and “could” are generally forward-looking in nature and not historical facts, although not all forward-looking
statements include the foregoing. Further, certain factors that could affect our future results and cause actual results to differ materially from those
expressed in the forward-looking statements include, but are not limited to whether the Company can: successfully implement its growth strategy,
including identifying acquisition targets and consummating suitable acquisitions; continue to sustain internal growth rate; provide competitive products
and services that appeal to its customers and target market; continue to have access to debt and equity capital markets; and achieve its performance
goals. For discussion of these and other risks that may cause actual results to differ from expectations, please refer to “Speical Cautionary Note
Regarding Forward-Looking Statements” and “Risk Factors” in Veritex’s Annual Report on Form 10-K filed with the SEC on March 10, 2017 and any
updates to those risk factors set forth in Veritex’s subsequent Quarterly Reports on Form 10-Q or Current Reports on Form 8-K. If one or more events
related to these or other risks or uncertainties materialize, or if Veritex’s underlying assumptions prove to be incorrect, actual results may differ
materially from what Veritex anticipates. Accordingly, you should not place undue reliance on any such forward-looking statements. Any forward-looking
statement speaks only as of the date on which it is made, and Veritex does not undertake any obligation to publicly update or review any forward-
looking statement, whether as a result of new information, future developments or otherwise. New risks and uncertainties arise from time to time, and it
is not possible for us to predict those events or how they may affect us. In addition, Veritex cannot assess the impact of each factor on Veritex’s business
or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking
statements. All forward-looking statements, expressed or implied, included in this communication are expressly qualified in their entirety by this
cautionary statement. This cautionary statement should also be considered in connection with any subsequent written or oral forward-looking
statements that Veritex or persons acting on Veritex’s behalf may issue. Annualized, pro forma, projected and estimated numbers are used for
illustrative purpose only, are not forecasts and may not reflect actual results.
4
Headquartered in Dallas, Texas
Established in 2010
21 locations within several of the fastest
growing metropolitan markets in the U.S.
Strong core deposit mix and commercial
lending focus
Significant organic growth profile
complemented by disciplined M&A
Sovereign acquisition closed and system
conversion completed in third quarter 2017
Franchise FootprintOverview
Veritex – “Truth in Texas Banking”
6/30/17 Financial Highlights
Source: SNL Financial and Company documents; financial data as of 6/30/17.
(1) Pro forma represents Veritex and Sovereign figures as of 6/30/17 as adjusted for purchase accounting.
(2) Total loans excludes loans held for sale.
(Dollars in Millions)
D/FW Metroplex
As Reported Pro Forma
Total Assets 1,509$ 2,572$
Tota l Loans (2) 1,122 1,890
Tota l Depos its 1,211 2,024
NPAs / Assets 0.13% 0.46%
(1)
Veritex Community Bank: Goals, Objectives & Strategies
5
Our goal is to be Texas’ premier community bank generating superior returns for our
shareholders while delivering unparalleled customer service through personal
relationships maintained by a highly motivated and satisfied workforce.
Equip our bankers
with quality
support, analytic
resources, and
product solutions
tailored to meet our
customers’ needs.
Monitor banker
pipeline, sales and
closings.
Support the generation
of quality leads and
referrals resulting in
new business.
Implement programs
that focus on cross
selling.
Maintain a sharp
focus on capital
growth through
consistent increase in
earnings and tangible
book value.
Closely manage cost
and income
opportunities.
Identify unprofitable
relationships and
manage them
accordingly.
Link profitability to
executive and lender
compensation.
Manage production
teams and
operations to
ensure compliance
with policies,
procedures and
regulations.
Invest time, resources,
and capital in technology,
compliance, audit and risk
management.
Maintain sound policies
and procedures, obtain
buy-in from staff.
Maintain high quality
credit culture, continue to
monitor and analyze the
loan portfolio.
Build a banking
team and corporate
structure that
consistently
outperforms our
peer group.
Continue to build teams that
provide excellent customer
service and support all areas
of the bank.
Improve and foster
Veritex culture and
brand.
Hire and retain best in
class employees.
G
o
al
Obje
cti
ve
s
St
ra
tegi
es
~40% annualized loan growth for the quarter
Record loan production exceeding $100 million
Pipelines are building with the addition of experienced lending
executives to our already strong team
Loan Growth
6
Recently Announced Q2 Highlights
0.13% NPAs to Total Assets
No material net charge offs in the quarter
Continued strong credit trends
Pristine Credit
3.53% NIM representing a 32bps increase from Q1
55.0% efficiency ratio
Diluted EPS of $0.23 vs. $0.20 in Q1
Earnings Trends
Source: VBTX earnings release. Figures represent Veritex standalone for the periods noted.
7
Announced Acquisition of Liberty Bancshares
Source: SNL Financial and Company documents. Weighted deposit market share rank based upon SNL Branch Analytics.
(1) Data as of and for the second quarter ended 6/30/17.
(2) Pro forma represents combined Veritex, Sovereign and Liberty figures as of 6/30/17, excluding purchase accounting adjustments.
Company Overview
Financial Summary(1)
Fort Worth-based bank founded in 1985
with 5 branches in Tarrant County
Largest remaining independent bank with
significant assets in Fort Worth and Tarrant
County
Experienced lending team with intimate
knowledge of Tarrant County market
Strong asset quality
Pro Forma Metroplex Footprint
VBTX (12)
Sovereign (6)
Liberty (5)
Strong pro forma(2) Tarrant County deposit
franchise:
̶ Ranked 11th in deposits in Tarrant County
̶ Ranked 4th among Texas-based banks
Consolidated Balance Sheet Data ($ in 000s)
Total Assets 459,287$
Total Loans 330,206
Total Deposits 389,440
Loans / Deposits 84.8%
Tangible Common Equity 35,207$
T E / TA 7.9%
Bank Level Profitability Data (MRQ 6/30/17)
ROAA 0.91%
Net Interest Margin 3.94%
Efficiency Ratio 62.2%
Asset Quality
NPAs / Assets 0.36%
Significant Expansion in Attractive Fort Worth Market
Source: SNL Financial & United States Census Bureau Estimates.
(1) Pro forma represents combined Veritex, Sovereign and Liberty figures as of 6/30/17, excluding purchase accounting adjustments.
(2) Weighted deposit market share rank based upon SNL Branch Analytics.
8
Projected 5-Year Population GrowthMarket Highlights
Tarrant County is the 5th fastest growing
county in the U.S.
Fort Worth is the 16th largest city in the
U.S. ranked by population
Headquarters for several major U.S.
corporations plus significant ongoing
corporate relocations and expansions
Veritex’s pro forma(1) Tarrant County
franchise will include:
̶ 8 branch offices
̶ $501 million in loans
̶ $515 million in deposits
Pro Forma Deposit Market Share
8.5%
8.1%
7.5%
3.8%
Fort Worth DFW Texas National
Tarrant County
Overall
Rank
TX HQ
Rank
Bank City State
Weighted
Deposits (2)
1 JPMorgan Chase & Co. New York NY 7,280,813$
2 Wells Fargo & Co. San Francisco CA 6,075,447
3 Bank of America Corp. Charlotte NC 4,874,500
4 1 Cullen/Frost Bankers Inc. San Antonio TX 4,353,891
5 Banco Bilbao Vizcaya Argentaria SA Bilbao - 2,752,698
6 Simmons First National Corp. Pine Bluff AR 1,258,807
7 BOK Financial Corp. Tulsa OK 813,080
8 Pinnacle Bancorp Inc. Omaha NE 720,439
9 2 Southside Bancshares Inc. Tyler TX 701,935
10 3 Hilltop Holdings Inc. Dallas TX 521,462
11 4 Veritex Holdings Inc. Dallas TX 507,843
12 5 Comerica Inc. Dallas TX 409,537
13 Capital One Financial Corp. McLean VA 404,159
14 6 Colonial Holding Co. Fort Worth TX 361,919
15 7 First Command Financial Services Inc. Fort Worth TX 328,602
(Dollars in Thousands)
9
Accretive Transaction Combined with Growth Capital
Note: Estimated pro forma for completion of the Sovereign transaction (including purchase accounting adjustments) and assumes Liberty transaction closes on 12/31/17. Assumes ~$50
million equity raise plus 15% option based on an offering price per share of $26.53, the closing price as of 7/28/17. EPS accretion estimates represent figures before any deployment of
growth capital.
Transaction
Impact
Growth
Capital
TCE / TA 8.8% 10.5%
Total RBC 11.2% 13.2%
100% CL&D Guideline ~125% ~100%
300% CRE Guideline ~360% ~300%
2018 EPS Accretion ~8% ~0.5%
2019 EPS Accretion ~9% ~1%
TBVPS Accretion / (Dilution) ~(4%) ~5%
Pro Forma
Liberty
Pro Forma
Equity Raise
Expect net undeployed proceeds of ~$45 million after payment of cash
consideration in Sovereign and Liberty transactions
Represents unique opportunity to provide growth capital and meaningful
TBVPS accretion without EPS dilution
̶ The merger and offering combined is slightly accretive to 2018 EPS
before assuming any deployment or leveraging of growth capital
Positions Veritex to take full advantage of significant growth opportunities
̶ Robust loan and M&A pipelines are expected to continue
̶ Emphasis on maintaining credit quality and M&A disciplines
̶ Proven history and relentless focus on stewardship of capital
$1,408,507
$181,800
$220,100
$121,417
$197,949
$437,820
$524,127
$664,971
$802,286
$1,039,551
$1,508,589
$2,572,394
$3,031,681
2010 2011 2012 2013 2014 2015 2016 6/30/17 Pro Forma
6/30/17
Pro Forma
6/30/17
Total Assets at Year End Assets Acquired During the Year
Successful Organic Growth and M&A Strategy
Source: SNL Financial and Company documents.
(1) Pro forma represents combined assets for Veritex and Sovereign as of 6/30/17, including purchase accounting adjustments.
(2) Pro forma represents combined assets for Veritex, Sovereign and Liberty as of 6/30/17, including purchase accounting adjustments for Sovereign, but not Liberty.
10
Founded Veritex
Holdings &
acquired $182
million asset
Professional Bank
Acquired $166
million asset
Fidelity Bank and
$54 million asset
Bank of Las
Colinas
Grew $86
million
organically
and hit $500
million in
total assets
Grew $141
million
organically
Completed $40
million Initial
Public Offering
and grew $137
million
organically
Acquired
$121 million
asset IBT
Bancorp, Inc.
Grew $369
million or 35.5%
organically
in 2016
(Dollars in Thousands)
Record Q2
loan growth
of $100
million
(1) (2)
Commitment to Delivering Shareholder Value
Sources: SNL Financial, Company documents as filed for the period ending 6/30/17 and Factset as of 9/12/17. Figures represent Veritex standalone for the periods noted.
(1) Excludes loans held for sale.
(2) Efficiency ratio calculated as net interest income excluding provision for loan loss plus noninterest income divided by total noninterest expense.
Total Deposits
11
Efficiency Ratio (2)
(Dollars in Millions)
92.2%
78.0%
69.8%
66.5%
60.8%
55.6% 55.0%
2011 2012 2013 2014 2015 2016 2Q17
Performance Since IPO
(Dollars in Millions)
Total Loans (1)
$298
$398
$495
$603
$821
$992
$1,122
2011 2012 2013 2014 2015 2016 2Q17
$365
$448
$574
$639
$868
$1,120
$1,211
2011 2012 2013 2014 2015 2016 2Q17
Veritex
96.2%
NASDAQ Bank
49.6%
S&P 500
29.5%
Total Houston loan exposure $209.7 million
Loan Mix $149.8 million Commercial real estate
$ 59.8 million Non-real estate
Loan Exposure
12
Houston Market Update
Expect minimal impact to loan loss reserve
Continue to evaluate the impact of Hurricane Harvey on our Houston
business
Credit Impact
Employees are safe, our offices did not incur any significant damage,
and most borrowers did not experience any significant downtime
Options offered to customers include:
➢ Moratorium on principal payments for up to 90 days
➢ Short term working capital/assistance loans
➢ Waiving overdraft, NSF and late payment fees
Hurricane Harvey Impact
13
Acquisition and Integration Update
Third
Quarter
2017
Fourth
Quarter
2017
First
Quarter
2018
Second
Quarter
2018
Closed Sovereign on
August 1, completed
integration and system
conversion on
September 11
Liberty shareholder
meeting to approve
transaction
Anticipated close of the
Liberty transaction
Liberty integration and
conversion
Announced definitive
agreement for Liberty on
August 1
Expected significant
recognition of Sovereign
cost savings
Focus on Liberty
integration and system
conversion
Expected full realization
of Sovereign cost
savings. Continue Liberty
transition and cost
savings
Pro Forma Loan Composition
Source: 6/30/17 call report data from SNL.
(1) Pro forma represents combined Veritex, Sovereign and Liberty figures as of 6/30/17, excluding purchase accounting adjustments. 14
Loans ($000) Loans ($000) Loans ($000) Loans ($000)
Construction & Land 136,332$ 12.1% Construction & Land 137,845$ 17.4% Construction & Land 71,614$ 21.7% Construction & Land 345,791$ 15.4%
Residential Mortgage 157,249 14.0% Residential Mortgage 13,491 1.7% Residential Mortgage 61,336 18.6% Residential Mortgage 232,076 10.3%
Home Equity 4,692 0.4% Home Equity 3,826 0.5% Home Equity 12,923 3.9% Home Equity 21,441 1.0%
Owner-Occupied CRE 134,572 11.9% Owner-Occupied CRE 123,982 15.6% Owner-Occupied CRE 67,368 20.4% Owner-Occupied CRE 325,922 14.5%
Nonowner-Occupied CRE 296,323 26.3% Nonowner-Occupied CRE 250,843 31.6% Nonowner-Occupied CRE 39,842 12.1% Nonowner-Occupied CRE 587,008 26.1%
Multifamily 38,265 3.4% Multifamily 27,505 3.5% Multifamily 10,099 3.1% Multifamily 75,869 3.4%
C & I 347,017 30.8% C & I 229,540 28.9% C & I 60,188 18.2% C & I 636,745 28.3%
Consumer, Farm & Other 12,136 1.1% Consumer, Farm & Other 5,980 0.8% Consumer, Farm & Other 6,836 2.1% Consumer, Farm & Other 24,952 1.1%
Total 1,126,586$ 100.0% Total 793,012$ 100.0% Total 330,206$ 100.0% Total 2,249,804$ 100.0%
Yield 4.87% Yield 4.70% MRQ Yield 4.98% MRQ Yield 4.83%
12.1%
14.0%
0.4%
11.9%
26.3%
3.4%
30.8%
1.1%
Construction & Land Residential Mortgage
Home Equity Owner-Occupied CRE
Nonowner-Occupied CRE Multifamily
C & I Consumer, Farm & Other
17.4%
1.7%
0.5%
15.6%
31.6%
3.5%
28.9%
0.8%
Construction & Land Residential Mortgage
Home Equity Owner-Occupied CRE
Nonowner-Occupied CRE Multifamily
C & I Consumer, Farm & Other
21.7%
18.6%
3.9%
20.4%
12.1%
3.1%
18.2%
2.1%
Construction & Land Residential Mortgage
Home Equity Owner-Occupied CRE
Nonowner-Occupied CRE Multifamily
C & I Consumer, Farm & Other
15.4%
10.3%
1.0%
14.5%
26.1%
3.4%
28.3%
1.1%
Construction & Land Residential Mortgage
Home Equity Owner-Occupied CRE
Nonowner-Occupied CRE Multifamily
C & I Consumer, Farm & Other
(Dollars in Thousands)
Pro Forma(1)Veritex Sovereign Liberty
Pro Forma Deposit Composition
Source: 6/30/17 call report data from SNL.
(1) Pro forma represents combined Veritex, Sovereign and Liberty figures as of 6/30/17, excluding purchase accounting adjustments.
(2) Excludes holding company cash deposited at the bank.
15
27.8%
62.7%
1.3%
8.2%
Noninterest-bearing Deposits
IB Demand, Savings & MMDA
Retail Time Deposits
Jumbo Time Deposits
20.6%
30.1%
5.2%
44.1%
Noninterest-bearing Deposits
IB Demand, Savings & MMDA
Retail Time Deposits
Jumbo Time Deposits
33.6%
30.3%4.4%
31.7%
Noninterest-bearing Deposits
IB Demand, Savings & MMDA
Retail Time Deposits
Jumbo Time Deposits
26.3%
46.5%
3.1%
24.1%
Noninterest-bearing Deposits
IB Demand, Savings & MMDA
Retail Time Deposits
Jumbo Time Deposits
(Dollars in Thousands)
Deposit ($000) Deposits ($000) Deposits ($000) Deposits ($000)
Noninterest-bearing Deposits (2) 337,057$ 27.8% Noninterest-bearing Deposits 167,843$ 20.6% Noninterest-bearing Deposits 130,988$ 33.6% Noninterest-bearing Deposits 635,888$ 26.3%
IB De and, Savings & MMDA 758,9 1 62.7 IB Demand, Savings & MMDA 244, 1 3 .1 IB Demand, Savings & MMDA 18,224 0.3 IB Demand, Savings & MMDA 1,122,016 4 .5
Retail Ti e Deposits 15,858 1.3% Retail Time Deposits 2,668 5.2% Retail Time Deposits 7,075 4.4% Retail Time Deposits 75,601 3.1%
Jumbo Time Deposits 99,241 8.2 Jumbo Ti e Deposits 358,555 44.1 Jumbo Ti e Deposits 123,489 31.7 Jumbo Ti e Deposits 581,285 24.
Total 1,211,107$ 100.0% Total 813,907$ 100.0% Total 389,776$ 100.0% Total 2,414,790$ 100.0%
MRQ Cost(2) 0.58% MRQ Cost 0.68% MRQ Cost 0.44% MRQ Cost 0.59%
Pro Forma(1)Veritex Sovereign Liberty
Experienced Leadership
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Executive Management
C. Malcolm Holland, III
Chairman of the Board,
Chief Executive Officer
35 years of banking experience in Texas
Former CEO of Texas region for Colonial Bank, which grew from $625 million to
$1.6 billion
Former President of First Mercantile Bank
William C. Murphy
Vice Chairman
45 years of banking experience
Former Chairman or CEO of several Dallas community banks
Has led 25 financial institution transactions
Noreen E. Skelly
Chief Financial Officer
30 years of banking experience
Former CFO of Highlands Bancshares, Inc.
Former SVP and Retail line of business chief finance officer for Comerica and
LaSalle Banks
Jeff Kesler
Chief Lending Officer
16 years of banking experience
Former president of Dallas and Austin markets for Colonial Bank
Clay Riebe
Chief Credit Officer
30 years of banking experience
Former Chief Lending Officer of American Momentum Bank
Former market president of Citibank’s Bryan/College Station markets
LaVonda Renfro
Chief Retail Officer
32 years of banking experience
Former Retail Executive of Colonial Bank/BB&T
Former Senior Vice President, District Manager for Bank of America’s Austin and
San Antonio markets
Angela Harper
Chief Risk Officer
25 years of banking experience
Former Senior Vice President, Credit Administration Officer and Risk Management
Officer for the Texas Region of Colonial Bank
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Reconciliation of Non-GAAP Measures
The Company’s management uses certain non-GAAP financial measures to evaluate its performance including tangible book
value per common share and tangible common equity to tangible assets. The Company has included in this presentation
information related to these non-GAAP financial measures for the applicable periods presented. Reconciliation of these non-
GAAP financial measures to the most directly comparable GAAP financial measures are presented in the table below.
(Dollars in Thousands, Except Per Share)
As of December 31, As of
2011 2012 2013 2014 2015 2016 6/30/17
Total Stockholders' Equity 58,676$ 61,860$ 66,239$ 113,312$ 132,046$ 239,088$ 247,602$
Preferred Stock (8,000) (8,000) (8,000) (8,000) - - -
Common Equity 50,676 53,860 58,239 105,312 132,046 239,088 247,602
Goodwill (19,148) (19,148) (19,148) (19,148) (26,865) (26,865) (26,865)
Intangible Assets (2,183) (1,875) (1,567) (1,261) (2,410) (2,181) (2,171)
Tangible Common Equity 29,345 32,837 37,524 84,903 102,771 210,042 218,566
Common Shares Outstanding 5,554 5,694 5,805 9,471 10,712 15,195 15,233
Tangible Book Value per Share 5.28$ 5.77$ 6.46$ 8.96$ 9.59$ 13.82$ 14.35$
To al ss ts 437,820$ 524,127$ 664,946$ 802,231$ 1,039,551$ 1,408,507$ 1,508,589$
Go will (19,148) (19,148) (19,148) (19,148) (26,865) (26,865) (26,865)
Intangible Assets (2,183) (1,875) (1,567) (1,261) (2,410) (2,181) (2,171)
Tangible Assets 416,489 503,104 644,231 781,822 1,010,276 1,379,461 1,479,553
Tangible Common Equity 29,345 32,837 37,524 84,903 102,771 210,042 218,566
TCE / TA 7.0% 6.5% 5.8% 10.9% 10.2% 15.2% 14.8%
Source: Company documents.
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