Hilltop Holdings Reports Mixed Q3 Results Amid Challenging Economic Conditions

Hilltop Holdings Inc. reported its financial results for the third quarter and the nine months ended September 30, 2024, reflecting a mixed performance across its business segments amid challenging economic conditions.

For the third quarter of 2024, total interest income decreased to $211.0 million from $216.8 million in the same period of 2023. Net interest income also fell to $105.0 million, down from $115.7 million year-over-year. The decline in net interest income was attributed to increased deposit costs and a shift from noninterest-bearing to interest-bearing deposits. The net interest margin compressed to 2.85% from 3.04% in the prior year.

Total noninterest income for the third quarter increased slightly to $200.4 million, compared to $196.8 million in Q3 2023, driven by gains in structured finance and fixed income services. However, the mortgage origination segment continued to experience operating losses, reporting a loss before income taxes of $46.9 million for the quarter, although this was an improvement from the previous year’s loss of $48.2 million.

Net income for the third quarter was $32.9 million, down from $39.3 million in Q3 2023, with income attributable to Hilltop shareholders decreasing to $29.7 million from $37.0 million. Basic earnings per share fell to $0.46 from $0.57 in the prior year.

For the nine months ended September 30, 2024, total interest income rose to $627.8 million from $621.6 million in 2023, but net interest income decreased to $312.3 million from $355.6 million. Noninterest income for the nine-month period increased to $575.4 million from $550.0 million, primarily due to higher securities commissions and advisory fees. Net income for the nine months was $85.3 million, down from $87.0 million in 2023.

The company’s total assets as of September 30, 2024, were $15.9 billion, a decrease from $16.5 billion a year earlier. Total deposits also declined to $10.8 billion from $11.1 billion. However, total stockholders' equity increased to $2.2 billion from $2.1 billion, reflecting retained earnings growth.

Strategically, Hilltop Holdings continues to navigate economic headwinds, including rising interest rates and inflation. The company has implemented a stock repurchase program, spending $19.9 million to repurchase shares during the nine months ended September 30, 2024. Additionally, a quarterly cash dividend of $0.17 per share was declared on October 24, 2024, reflecting a commitment to returning value to shareholders despite the challenging environment.

Overall, Hilltop Holdings is focusing on maintaining liquidity and managing its balance sheet effectively while adapting to the evolving economic landscape.