Key insight: Texas Capital launched a new plan to grow its private banking and family office business. It plans to employ a playbook that’s similar to the one it employed in building its investment banking business.
Supporting data: The company doubled its investment banking and advisory fees over the last year, to $32 million in the first quarter.
Forward look: Despite seeing credit costs tick up in the first quarter, the bank maintained its guidance for 2026.
Texas Capital Bancshares is notching more “firsts” as it continues to see the impact of its multiyear turnaround.
The Dallas-based bank has launched a new family office business, and it will pay a quarterly common stock dividend for the first time in its history. Chairman, President and CEO Rob Holmes said Thursday that the latter move is a sign that Texas Capital has grown through its transformation into a “mature platform.”
“The dividend shows great confidence in the platform and our bankers and our earnings and prospects going forward, as well as our capital and our risk posture,” Holmes said on a call with analysts.
Chief Financial Officer Matt Scurlock added that the dividend isn’t related to regulators’ recently announced suite of proposals, which, as written, should be a boon to banks’ capital management.
Holmes was brought to Texas Capital in 2021 to design and steer an overhaul. In the last five years, the bank has restructured its workforce, updated its technology stack and built out a massive investment banking unit. Last fall, Texas Capital finally hit several of the lofty profitability targets Holmes had set when he launched the strategy.
On Thursday, Texas Capital announced several executive leadership appointments and promotions. Scurlock added the president title to his CFO responsibilities. John Cummings, who has been chief administrative officer since he joined the company in 2022, was named chief operating officer.
In the first quarter, Texas Capital’s efforts to boost revenue led to financial results that beat expectations.
The bank reeled in $69.5 million of net income, up from $42.7 million, during the same period last year. Earnings per diluted share of $1.56 beat the consensus analyst estimate of $1.40. Net interest income of $254.7 million marked an 8% year-over-year rise, and non-interest income rose 56% to $69.3 million.
Holmes said Texas Capital’s spike in non-interest income came, in part, from record quarterly fee income from the bank’s areas of focus — investment banking and trading income, treasury product fees and wealth management and trust fee income.
Texas Capital’s revenue of $324 million was up about 16% from the same period last year.
The $33.5 billion-asset bank also announced that it has started expanding its recently revamped private banking and family office line of business, as part of the massive build-out of its investment bank in recent years.
The business isn’t entirely new to Texas Capital. The bank has offered certain wealth management services since before the transformation kicked off in 2021, Holmes said. But he added that, “like most” parts of the legacy bank, “the infrastructure in it was really, really poor.”
Texas Capital has since revamped the underpinnings of that business, including by rebuilding the digital capabilities. The unit will cross-sell products to existing and new Texas Capital customers, Holmes said.
“Now, with the right infrastructure and the right client journey, we think we can really put weight behind that business and grow it,” Holmes said.
The bank rolled out the family office piece of the business about six months ago, Holmes said. Dallas is a hot spot for family offices, which Holmes called “a real key component in differentiating, both for the private bank, as well as investment banking and treasury.”
The bank announced Thursday that Jay Clingman, who previously led commercial banking at Texas Capital, has been tapped to head the private banking and family office unit. Before joining the bank in 2021, Clingman spent three decades at JPMorganChase in Texas, where at one point he oversaw all private banking efforts in San Antonio, Austin and Houston.
The company’s cross-selling efforts helped it nearly double investment banking and advisory fees over the last year, to $32 million in the first quarter.
The bank’s earnings report did reflect some challenges.
Net charge-offs rose to $17.4 million, up from $10.7 million in the prior quarter and $9.8 million in the first quarter of last year. The $16 million provision for credit losses was up 45% from the prior quarter, though it was down by 6% from the first quarter of 2025.
Holmes said Thursday that the bank has been accounting for potential risks from the fallout of the war in Iran.
“Leading up to the recent conflict in the Middle East, we assessed the impact of rising commodities pricing on a series of client segments,” Holmes said. “While our assessment across these topical areas suggest impacts on specific clients are, at this point, tangential, we nonetheless continue to assume a credit posture in the reserve calculation that is increasingly reliant on a downside scenario weighting.”
Still, Texas Capital maintained its guidance for 2026. The bank expects to log adjusted revenue growth in the mid-to-high single-digits percentage points, up from $1.26 billion in 2025.
