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): January 27, 2016

_________
TRISTATE CAPITAL HOLDINGS, INC.
(Exact name of registrant as specified in its charter)
_________
Pennsylvania
 
001-35913
 
20-4929029
(State or other jurisdiction of incorporation or organization)
 
(Commission File Number)
 
(I.R.S. Employer Identification No.)
One Oxford Centre
301 Grant Street, Suite 2700
Pittsburgh, Pennsylvania 15219
(Address of principal executive offices)
(Zip Code)
( 412) 304-0304
(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 (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))



1


Item 2.02. Results of Operations and Financial Condition.

On January 27, 2016 , TriState Capital Holdings, Inc. issued a press release which disclosed results of operations for the three months and year ended December 31, 2015 . A copy of the press release is included as Exhibit 99 to this report.

The information in this report, including the exhibit attached hereto, is furnished solely pursuant to Item 2.02 of this Form 8-K and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall such information be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as expressly set forth by specific reference in such a filing.

Item 9.01. Financial Statements and Exhibits.

Exhibit No.
Description
99
Press release dated January 27, 2016 , filed herewith.


2


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 thereunto duly authorized.


TRISTATE CAPITAL HOLDINGS, INC.
 
 
By
/s/ James F. Getz
 
James F. Getz
 
Chairman, President and Chief Executive Officer
 
 

Date: January 27, 2016


3


EXHIBIT INDEX


Exhibit No.
Description
99
Press release dated January 27, 2016 , filed herewith.


4
EXHIBIT 99



FOR IMMEDIATE RELEASE                            


TRISTATE CAPITAL REPORTS FOURTH QUARTER AND FULL YEAR 2015 FINANCIAL RESULTS

PITTSBURGH, January 27, 2016 - TriState Capital Holdings, Inc. (NASDAQ: TSC), parent company of TriState Capital Bank and Chartwell Investment Partners, LLC, reported record net income of $22.5 million for the year ended December 31, 2015 , increasing 41.2% from $15.9 million in 2014. Diluted earnings per share increased 45.5% to $0.80 in 2015 from $0.55 in 2014 . Adjusting for acquisition related expenses associated with The Killen Group (TKG) transaction announced last month, the company earned $0.81 per share in 2015 . TriState Capital continued to expand its private banking, middle-market commercial banking and investment management businesses by profitably growing loans, deposits and total revenue, and further enhancing the financial services company’s revenue mix and asset quality.

For the fourth quarter of 2015 , the company recorded net income of $5.6 million , increasing 9.7% from $5.1 million in the fourth quarter of 2014 . Fourth quarter 2015 earnings per share were $0.20 , compared to $0.18 in the fourth quarter of 2014 . Excluding acquisition related expenses, the company earned $0.21 per share in the fourth quarter of 2015 .

“TriState Capital’s business model delivered highly profitable growth across all business lines in 2015 , increasing earnings per share by more than 45% , lending by 18% , net interest income by 3% , non-interest income by 13% and total revenue by 8% ,” said Chief Executive Officer James F. Getz. “Since 2011, TriState Capital has achieved compound annual growth in earnings per share of 25% . This performance is a direct result of the disciplined execution of our distinctive growth strategy, which we intend to continue through the ongoing organic expansion of private banking, middle-market commercial banking and investment management, as well as opportunistic acquisitions that accelerate Chartwell Investment Partners’ growth.”

TriState Capital entered into a definitive agreement in December to acquire TKG. The investment manager is advisor to The Berwyn Funds, including the Berwyn Income Fund, a Morningstar five-star rated conservative allocation strategy that is tailored for the type of challenging environment that the capital markets have experienced in the initial weeks of 2016. The acquisition is expected to be immediately accretive and boost Chartwell annual investment management fees to nearly 40% of total revenue. The closing is anticipated in the second quarter of 2016.

FOURTH QUARTER 2015 HIGHLIGHTS
•
Total loans grew 6.8% during the quarter and 18.4% from one year prior
•
Private banking loans grew 12.1% during the quarter and 35.9% from one year prior
•
Deposits grew 3.4% during the quarter and 15.1% from one year prior
•
Non-performing assets (NPAs) declined to 0.56% of assets and adverse rated credits declined to 1.9% of loans at December 31
•
Total revenue grew 6.5% during the quarter, with non-interest income up 12.9% and net interest income (NII) up 3.4%
•
Pre-tax, pre-provision net revenue grew 11.1% during the quarter
•
Chartwell investment management fees grew to $7.4 million , or 27.9% of total revenue, on higher net inflows from new and existing clients

Fourth quarter 2015 provision expense was $244,000 , reflecting the significant growth of TriState Capital’s loan portfolio, consistent with the lower credit risk profile of private banking lending, which grew to represent 47.3% of loans at year-end. The company recorded credits to provision of $1.3 million in the linked third quarter and $209,000 in the fourth quarter of 2014 .

TriState Capital’s loan growth continues to generate strong NII that outpaces margin compression. NII was $17.5 million in the fourth quarter of 2015 , compared to $17.0 million in the linked quarter and $17.5 million in the year-ago period.


1
EXHIBIT 99

Fourth quarter 2015 non-interest income was $9.1 million , or 34.2% of total revenue, compared to $8.1 million in the linked quarter and $8.8 million in the year-ago period. TriState Capital non-interest income is largely comprised of Chartwell investment management fees, which were $7.4 million , or 27.9% of total revenue, in the fourth quarter of 2015 , compared to $7.0 million in the linked quarter and $7.7 million in the year-ago quarter.

Higher NII and non-interest income increased total revenue to $26.6 million in the fourth quarter of 2015 , up from $25.0 million in the linked quarter and $26.3 million in the year-ago quarter.

Non-interest expenses were $18.1 million in the fourth quarter of 2015 , including $601,000 of non-recurring TKG-acquisition related costs, and $19.4 million in the fourth quarter of 2014 , including $1.6 million of Chartwell-acquisition earnout expense. Excluding these acquisition related costs, non-interest expenses were $17.5 million , or 2.16% of average assets on an annualized basis in the fourth quarter of 2015 , compared to $17.3 million , or 2.25% , in the linked quarter and $17.8 million , or 2.51% , in the prior-year quarter. The efficiency ratio for the bank was 62.14% in the fourth quarter of 2015 , compared to 64.93% in the linked quarter and 60.47% in the year-ago quarter.

TriState Capital reported an effective tax rate of approximately 33% for 2015 and expects a rate of approximately 35% for 2016.

BALANCE SHEET GROWTH
Loans totaled $2.84 billion at December 31, 2015 , increasing 6.8% from September 30 and 18.4% from December 31, 2014 . Private banking loans totaled $1.34 billion , growing 12.1% from the end of the linked quarter and 35.9% from the end of the year-ago quarter. Commercial real estate (CRE) loans totaled $862.2 million , growing 3.7% from the end of the linked quarter and 17.6% from the end of the year-ago quarter. Commercial and industrial (C&I) loan balances were $634.2 million at December 31, 2015 , increasing 0.7% from the end of the linked quarter and decreasing 6.4% from one year prior.

Private banking grew to represent 47.3% of total loans at December 31, 2015 , CRE represented 30.3% of total loans and C&I represented 22.4% of total loans.

Deposits totaled $2.69 billion at December 31, 2015 , increasing 3.4% from September 30 and 15.1% over balances at December 31, 2014 . The bank extended time deposit maturities to 264 days at December 31, 2015 from 186 days one year prior.

TriState Capital remains very well positioned to profit from a rising interest-rate environment as the bank continues to manage a highly asset-sensitive balance sheet. At December 31, 2015 , 85% of TriState Capital’s loan portfolio and 58% of its securities portfolio were floating rate. In addition, 35% of deposits were fixed-rate time deposits.

ASSET QUALITY
TriState Capital’s strong asset quality metrics continued to reflect the bank’s strategic shift toward lower-risk-profile lending, particularly margin loans secured by marketable securities, which represented approximately 88% of private banking loans and 42% of total loans at December 31, 2015 .

NPAs declined by $2.5 million , or 11.9% , to $18.4 million during the fourth quarter of 2015 . NPAs represented 0.56% of total assets at December 31, 2015 , improving from 0.67% at September 30 and 1.11% at December 31, 2014 . TriState Capital reduced NPAs as a percentage of total assets by 34 basis points from 0.90% at December 31, 2011, even as the company has grown assets by 80.1% over the same period.

Adverse-rated credits declined 1.5% during the fourth quarter and 19.8% from December 31, 2014 . Adverse-rated credits represented 1.9% of total loans at the end of the fourth quarter of 2015 , 2.1% at September 30 and 2.8% at December 31, 2014 . TriState Capital reduced adverse-rated credits as a percentage of total loans by 250 basis points from 4.4% at December 31, 2011, even as the company has grown loans by 101.9% over the same period.


2
EXHIBIT 99

TriState Capital experienced net charge-offs on loans totaling $1.6 million , or 0.23% of average total loans, in the current quarter compared to $716,000 , or 0.11% , in the linked quarter and $1.9 million , or 0.32% , in the year-ago quarter. Net charge-offs for the full year were $2.3 million in 2015 , compared to $8.9 million in the prior year.

The company’s allowance for loan losses declined to 0.63% of total loans at December 31, 2015 , from 0.73% at September 30 and 0.84% at December 31, 2014 . This reflects the reduction in NPAs and the lower provision required for private banking margin loans.

INVESTMENT MANAGEMENT
Chartwell’s assets under management (AUM) were $8.0 billion at the end of the fourth quarter of 2015 , compared to $7.6 billion at the end of the linked quarter and $7.7 billion at December 31, 2014 . Fourth quarter 2015 AUM growth reflects $323 million in new business and new flows from existing accounts, as well as $131 million of market appreciation , which more than offset outflows of $74 million . Chartwell’s weighted average fee rate was 0.37% for each of the third and fourth quarters of 2015 .

Chartwell’s net income grew to $1.1 million in the fourth quarter of 2015 , comprising 20% of TriState Capital Holdings’ consolidated earnings, or 25% when excluding acquisition related expenses. Full-year Chartwell net income was $4.4 million in 2015, comprising 19% of consolidated earnings, or 20% when excluding acquisition related expenses. 

On December 16, 2015, TriState Capital announced that it entered into a definitive asset-purchase agreement to acquire TKG, which recorded investment management fees of $12.6 million on an annual-run-rate basis at an average weighted rate of 0.55%, as of December 31, 2015, as well as period-end AUM of $2.3 billion. TKG is investment advisor to The Berwyn Funds, including the Berwyn Income Fund, a Morningstar five-star rated conservative allocation strategy with a net asset value of $1.7 billion at December 31, 2015. Closing is anticipated in the second quarter of 2016, subject to regulatory requirements, approval by shareholders of The Berwyn Funds, certain TKG-client consents, and other customary closing conditions and adjustments. TriState Capital plans to integrate TKG’s personnel and operations into Chartwell, while maintaining The Berwyn Funds brand.

CAPITAL STRENGTH AND FLEXIBILITY
TriState Capital’s earnings in the quarter continued to support superior loan growth in the period, while the company maintained capital ratios that exceed the highest required regulatory benchmark levels. As of December 31, 2015 , TriState Capital Holdings reported ratios of 13.88% for total risk-based capital, 12.20% for tier 1 risk-based capital, 12.20% for common equity tier 1 risk-based capital and 9.05% for tier 1 leverage.

SHARE REPURCHASE PROGRAM
The company’s Board of Directors this week approved a share repurchase program of up to $10 million, authorizing TriState Capital Holdings to repurchase up to 1,000,000 shares of its common stock. The program authorizes repurchases totaling up to approximately 3.6% of TriState Capital Holdings’ 28,056,195 common shares outstanding at December 31, 2015 . Under the authorization, purchases may be made at the discretion of management from time to time in the open market or through negotiated transactions.

CONFERENCE CALL
As previously announced, TriState Capital will hold a conference call tomorrow to review its financial results and operating performance.

The live conference call on January 28 will be held at 8:30 a.m. ET. Telephone participants may avoid any delays by pre-registering for the call using the link http://dpregister.com/1007876 to receive a special dial-in number and PIN. Telephone participants who are unable to pre-register should dial in at least 10 minutes prior to the call and request the “TriState Capital Holdings call.” The call may be accessed by dialing 888-339-0757 from the United States, 855-669-9657 from Canada or 412-902-4194 from other international locations.

A replay of the call will be available approximately one hour after the end of the conference call through February 4 . The replay may be accessed by dialing 877-344-7529 from the United States, 855-669-9658 from Canada or 412-317-0088 from other locations and entering the conference number 10078768.

3
EXHIBIT 99


ABOUT TRISTATE CAPITAL
TriState Capital Holdings, Inc. (NASDAQ: TSC) is a bank holding company headquartered in Pittsburgh, Pa., providing commercial banking, private banking and investment management services to middle-market companies, institutional clients and high-net-worth individuals. Its TriState Capital Bank subsidiary has $3.2 billion in assets, as of December 31, 2015 , and serves middle-market commercial customers through regional representative offices in Pittsburgh, Philadelphia, Cleveland, Edison, N.J., and New York City, as well as high-net-worth individuals nationwide through its national referral network of financial intermediaries. Its Chartwell Investment Partners subsidiary has $8.0 billion in assets under management, as of December 31, 2015 , and serves institutional clients and TriState Capital’s financial intermediary network. For more information, please visit http://investors.tristatecapitalbank.com .

FORWARD LOOKING STATEMENTS
This press release includes “forward-looking” statements related to TriState Capital that can generally be identified as describing TriState Capital’s future plans, objectives or goals. Such forward-looking statements are subject to risks and uncertainties that could cause actual results or outcomes to differ materially from those currently anticipated. These forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. For further information about the factors that could affect TriState Capital’s future results, please see the company’s most-recent annual and quarterly reports filed on Form 10-K and Form 10-Q.

NON-GAAP FINANCIAL DISCLOSURES
This news release contains financial information determined by methods other than in accordance with U.S. generally accepted accounting principles (GAAP). Although TriState Capital believes non-GAAP financial measures provide a greater understanding of its business, these measures are not necessarily comparable to similar measures that may be presented by other companies. These disclosures should not be viewed as a substitute for financial measures determined in accordance with GAAP. Where non-GAAP disclosures are used, the comparable GAAP financial measure, as well as the reconciliation to the comparable GAAP financial measure, can be found within this news release and accompanying tables.

###

MEDIA CONTACTS
Jack Horner
267-932-8760, ext. 302
412-600-2295 (mobile)
jack@hornercom.com

INVESTOR RELATIONS CONTACT
TriState Capital Holdings, Inc.
Brian Fetterolf
412-304-0451
investorrelations@tscbank.com


4
EXHIBIT 99

TRISTATE CAPITAL HOLDINGS, INC.
SELECTED FINANCIAL HIGHLIGHTS (UNAUDITED)
 
As of and For the 
 Three Months Ended
 
As of and For the 
 Years Ended
(Dollars in thousands)
December 31,
September 30,
December 31,
 
December 31,
December 31,
 
2015
2015
2014
 
2015
2014
Period-end balance sheet data:
 
 
 
 
 
 
Cash and cash equivalents
$
96,676

$
100,424

$
105,710

 
$
96,676

$
105,710

Total investment securities
215,609

220,012

206,163

 
215,609

206,163

Loans held-for-investment
2,841,284

2,661,191

2,400,052

 
2,841,284

2,400,052

Allowance for loan losses
(17,974
)
(19,350
)
(20,273
)
 
(17,974
)
(20,273
)
Loans held-for-investment, net
2,823,310

2,641,841

2,379,779

 
2,823,310

2,379,779

Goodwill and other intangibles, net
50,816

51,205

52,374

 
50,816

52,374

Other assets
116,452

116,765

102,831

 
116,452

102,831

Total assets
$
3,302,863

$
3,130,247

$
2,846,857

 
$
3,302,863

$
2,846,857

 
 
 
 
 
 
 
Total deposits
$
2,689,844

$
2,600,508

$
2,336,953

 
$
2,689,844

$
2,336,953

Borrowings
255,000

175,000

165,000

 
255,000

165,000

Other liabilities
32,042

34,199

39,514

 
32,042

39,514

Total liabilities
2,976,886

2,809,707

2,541,467

 
2,976,886

2,541,467

 
 
 
 
 
 
 
Total shareholders' equity
325,977

320,540

305,390

 
325,977

305,390

 
 
 
 
 
 
 
Total liabilities and shareholders' equity
$
3,302,863

$
3,130,247

$
2,846,857

 
$
3,302,863

$
2,846,857

 
 
 
 
 
 
 
Income statement data:
 
 
 
 
 
 
Interest income
$
21,846

$
20,940

$
20,933

 
$
83,207

$
77,913

Interest expense
4,312

3,984

3,417

 
15,643

12,251

Net interest income
17,534

16,956

17,516

 
67,564

65,662

Provision (credit) for loan losses
244

(1,341
)
(209
)
 
13

10,159

Net interest income after provision for loan losses
17,290

18,297

17,725

 
67,551

55,503

Non-interest income:



 
 
 
Investment management fees
7,429

7,020

7,681

 
29,618

25,062

Net gain on sale of investment securities available-for-sale
16

—

—

 
33

1,428

Other non-interest income
1,674

1,044

1,149

 
6,221

5,231

Total non-interest income
9,119

8,064

8,830

 
35,872

31,721

Non-interest expense:
 
 
 
 
 
 
Intangible amortization expense
389

390

390

 
1,558

1,299

Acquisition earnout expense
—

—

1,614

 
—

1,614

Other non-interest expense
17,669

16,911

17,374

 
68,485

61,414

Total non-interest expense
18,058

17,301

19,378

 
70,043

64,327

Income before tax
8,351

9,060

7,177

 
33,380

22,897

Income tax expense
2,765

2,942

2,085

 
10,892

6,969

Net income
$
5,586

$
6,118

$
5,092

 
$
22,488

$
15,928




5
EXHIBIT 99

TRISTATE CAPITAL HOLDINGS, INC.
SELECTED FINANCIAL HIGHLIGHTS (UNAUDITED)
 
As of and For the 
 Three Months Ended
 
As of and For the 
 Years Ended
(Dollars in thousands, except per share data)
December 31,
September 30,
December 31,
 
December 31,
December 31,
 
2015
2015
2014
 
2015
2014
Per share and share data:
 
 
 
 
 
 
Earnings per share:
 
 
 
 
 
 
Basic
$
0.20

$
0.22

$
0.18

 
$
0.81

$
0.56

Diluted
$
0.20

$
0.22

$
0.18

 
$
0.80

$
0.55

Book value per common share
$
11.62

$
11.44

$
10.88

 
$
11.62

$
10.88

Tangible book value per common share (1)
$
9.81

$
9.61

$
9.02

 
$
9.81

$
9.02

Common shares outstanding, at end of period
28,056,195

28,027,695

28,060,888

 
28,056,195

28,060,888

Average common shares outstanding
 
 
 
 
 
 
Basic
27,750,118

27,728,705

28,419,773

 
27,771,345

28,628,631

Diluted
28,324,251

28,281,244

28,470,798

 
28,237,453

29,017,906

 
 
 
 
 
 
 
Performance ratios:
 
 
 
 
 
 
Return on average assets (2)
0.69
%
0.79
%
0.72
%
 
0.74
%
0.61
%
Return on average equity (2)
6.84
%
7.64
%
6.56
%
 
7.13
%
5.25
%
Net interest margin (2) (3)
2.28
%
2.32
%
2.61
%
 
2.35
%
2.62
%
Bank efficiency ratio (1)
62.14
%
64.93
%
60.47
%
 
62.30
%
59.93
%
Efficiency ratio (1)
64.08
%
67.59
%
65.95
%
 
65.65
%
63.96
%
Non-interest expense to average assets (2)
2.23
%
2.25
%
2.74
%
 
2.32
%
2.44
%
 
 
 
 
 
 
 
Asset quality:
 
 
 
 
 
 
Non-performing loans
$
16,660

$
19,119

$
30,232

 
$
16,660

$
30,232

Non-performing assets
$
18,390

$
20,885

$
31,602

 
$
18,390

$
31,602

Other real estate owned
$
1,730

$
1,766

$
1,370

 
$
1,730

$
1,370

Non-performing assets to total assets
0.56
%
0.67
%
1.11
%
 
0.56
%
1.11
%
Allowance for loan losses to loans
0.63
%
0.73
%
0.84
%
 
0.63
%
0.84
%
Allowance for loan losses to non-performing loans
107.89
%
101.21
%
67.06
%
 
107.89
%
67.06
%
Net charge-offs (recoveries)
$
1,621

$
716

$
1,894

 
$
2,312

$
8,882

Net charge-offs (recoveries) to average total loans (2)
0.23
%
0.11
%
0.32
%
 
0.09
%
0.41
%
 
 
 
 
 
 
 
Revenue:
 
 
 
 
 
 
Total revenue (1)
$
26,637

$
25,020

$
26,346

 
$
103,403

$
95,955

Pre-tax, pre-provision net revenue (1)
$
8,579

$
7,719

$
6,968

 
$
33,360

$
31,628

 
 
 
 
 
 
 
Capital ratios:
 
 
 
 
 
 
Tier 1 leverage ratio
9.05
%
9.30
%
9.21
%
 
9.05
%
9.21
%
Common equity tier 1 risk-based capital ratio
12.20
%
12.22
%
N/A

 
12.20
%
N/A

Tier 1 risk-based capital ratio
12.20
%
12.22
%
9.24
%
 
12.20
%
9.24
%
Total risk-based capital ratio
13.88
%
13.99
%
11.02
%
 
13.88
%
11.02
%
Tangible equity to tangible assets (1)
8.46
%
8.75
%
9.05
%
 
8.46
%
9.05
%
 
 
 
 
 
 
 
Assets under management
$
8,005,000

$
7,625,000

$
7,714,000

 
$
8,005,000

$
7,714,000


(1)  
These measures are not measures recognized under GAAP and are therefore considered to be non-GAAP financial measures. See “Non-GAAP Financial Measures” for a reconciliation of these measures to their most directly comparable GAAP measures.
(2)  
Ratios are annualized.
(3)  
Net interest margin is calculated on a fully taxable equivalent basis.

6
EXHIBIT 99

TRISTATE CAPITAL HOLDINGS, INC.
AVERAGES AND YIELDS (UNAUDITED)
 
Three Months Ended
 
December 31, 2015
 
September 30, 2015
 
December 31, 2014
(Dollars in thousands)
Average
Balance
Interest Income (1) /
Expense
Average
Yield/
Rate
 
Average
Balance
Interest Income (1) /
Expense
Average
Yield/
Rate
 
Average
Balance
Interest Income (1) /
Expense
Average
Yield/
Rate
Assets
 
 
 
 
 
 
 
 
 
 
 
Interest-earning deposits
$
94,191

$
89

0.37
%
 
$
94,015

$
84

0.35
%
 
$
100,475

$
88

0.35
%
Federal funds sold
6,240

2

0.13
%
 
6,197

2

0.13
%
 
6,843

1

0.06
%
Investment securities available-for-sale
170,229

651

1.52
%
 
172,922

597

1.37
%
 
171,235

519

1.20
%
Investment securities held-to-maturity
46,573

462

3.94
%
 
45,941

454

3.92
%
 
45,020

413

3.64
%
Investment securities trading
162

1

2.45
%
 
—

—

—
%
 
—

—

—
%
Total loans
2,747,727

20,711

2.99
%
 
2,598,362

19,872

3.03
%
 
2,349,968

19,970

3.37
%
Total interest-earning assets
3,065,122

21,916

2.84
%
 
2,917,437

21,009

2.86
%
 
2,673,541

20,991

3.11
%
Other assets
146,824

 
 
 
139,372

 
 
 
131,343

 
 
Total assets
$
3,211,946

 
 
 
$
3,056,809

 
 
 
$
2,804,884

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Liabilities and Shareholders' Equity
 
 
 
 
 
 
 
 
 
 
 
Interest-bearing deposits:
 
 
 
 
 
 
 
 
 
 
 
Interest-bearing checking accounts
$
118,029

$
121

0.41
%
 
$
97,493

$
99

0.40
%
 
$
103,454

$
110

0.42
%
Money market deposit accounts
1,437,963

1,608

0.44
%
 
1,418,547

1,523

0.43
%
 
1,180,448

1,147

0.39
%
Time deposits (excluding CDARS ® )
464,930

1,024

0.87
%
 
436,529

941

0.86
%
 
439,620

948

0.86
%
CDARS ®  time deposits
476,901

793

0.66
%
 
448,300

711

0.63
%
 
408,893

535

0.52
%
Borrowings:
 
 
 
 
 
 
 
 
 
 
 
FHLB borrowings
171,195

212

0.49
%
 
130,054

156

0.48
%
 
133,315

123

0.37
%
Subordinated notes payable
35,000

554

6.28
%
 
35,000

554

6.28
%
 
35,000

554

6.28
%
Total interest-bearing liabilities
2,704,018

4,312

0.63
%
 
2,565,923

3,984

0.62
%
 
2,300,730

3,417

0.59
%
Noninterest-bearing deposits
150,584

 
 
 
148,323

 
 
 
157,597

 
 
Other liabilities
33,559

 
 
 
24,743

 
 
 
38,454

 
 
Shareholders' equity
323,785

 
 
 
317,820

 
 
 
308,103

 
 
Total liabilities and shareholders' equity
$
3,211,946

 
 
 
$
3,056,809

 
 
 
$
2,804,884

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net interest income (1)
 
$
17,604

 
 
 
$
17,025

 
 
 
$
17,574

 
Net interest spread
 
 
2.21
%
 
 
 
2.24
%
 
 
 
2.52
%
Net interest margin  (1)
 
 
2.28
%
 
 
 
2.32
%
 
 
 
2.61
%

(1)  
Net interest income and net interest margin are calculated on a fully taxable equivalent basis.

7
EXHIBIT 99

TRISTATE CAPITAL HOLDINGS, INC.
AVERAGES AND YIELDS (UNAUDITED)
 
Years Ended
 
December 31, 2015
 
December 31, 2014
(Dollars in thousands)
Average
Balance
Interest Income (1) /
Expense
Average
Yield/
Rate
 
Average
Balance
Interest Income (1) /
Expense
Average
Yield/
Rate
Assets
 
 
 
 
 
 
 
Interest-earning deposits
$
102,240

$
363

0.36
%
 
$
155,241

$
525

0.34
%
Federal funds sold
6,168

6

0.10
%
 
7,495

4

0.05
%
Investment securities available-for-sale
164,701

2,201

1.34
%
 
174,285

2,167

1.24
%
Investment securities held-to-maturity
42,117

1,651

3.92
%
 
33,989

1,173

3.45
%
Investment securities trading
41

1

2.44
%
 
—

—

—
%
Total loans
2,570,200

79,245

3.08
%
 
2,145,870

74,279

3.46
%
Total interest-earning assets
2,885,467

83,467

2.89
%
 
2,516,880

78,148

3.10
%
Other assets
139,103

 
 
 
114,936

 
 
Total assets
$
3,024,570

 
 
 
$
2,631,816

 
 
 
 
 
 
 
 
 
 
Liabilities and Shareholders' Equity
 
 
 
 
 
 
 
Interest-bearing deposits:
 
 
 
 
 
 
 
Interest-bearing checking accounts
$
107,292

$
439

0.41
%
 
$
68,114

$
229

0.34
%
Money market deposit accounts
1,367,584

5,687

0.42
%
 
1,096,347

4,228

0.39
%
Time deposits (excluding CDARS ® )
450,874

4,041

0.90
%
 
469,120

3,984

0.85
%
CDARS ®  time deposits
447,462

2,721

0.61
%
 
411,393

2,170

0.53
%
Borrowings:
 
 
 
 
 
 
 
FHLB borrowings
120,425

540

0.45
%
 
98,370

373

0.38
%
Subordinated notes payable
35,000

2,215

6.33
%
 
20,041

1,267

6.32
%
Total interest-bearing liabilities
2,528,637

15,643

0.62
%
 
2,163,385

12,251

0.57
%
Noninterest-bearing deposits
149,567

 
 
 
133,733

 
 
Other liabilities
30,917

 
 
 
31,288

 
 
Shareholders' equity
315,449

 
 
 
303,410

 
 
Total liabilities and shareholders' equity
$
3,024,570

 
 
 
$
2,631,816

 
 
 
 
 
 
 
 
 
 
Net interest income (1)
 
$
67,824

 
 
 
$
65,897

 
Net interest spread
 
 
2.27
%
 
 
 
2.53
%
Net interest margin  (1)
 
 
2.35
%
 
 
 
2.62
%

(1)  
Net interest income and net interest margin are calculated on a fully taxable equivalent basis.

TRISTATE CAPITAL HOLDINGS, INC.
LOAN COMPOSITION (UNAUDITED)
 
December 31, 2015
 
September 30, 2015
 
December 31, 2014
(Dollars in thousands)
Loan
Balance
Percent of
Loans
 
Loan
Balance
Percent of
Loans
 
Loan
Balance
Percent of
Loans
Total private banking channel loans
$
1,344,864

47.3
%
 
$
1,199,883

45.1
%
 
$
989,302

41.2
%
Middle-market banking channel loans:
 
 
 
 
 
 
 
 
Commercial and industrial
634,232

22.4
%
 
630,131

23.7
%
 
677,493

28.2
%
Commercial real estate
862,188

30.3
%
 
831,177

31.2
%
 
733,257

30.6
%
Total middle-market banking channel loans
1,496,420

52.7
%
 
1,461,308

54.9
%
 
1,410,750

58.8
%
Loans held-for-investment
$
2,841,284

100.0
%
 
$
2,661,191

100.0
%
 
$
2,400,052

100.0
%


8
EXHIBIT 99

TRISTATE CAPITAL HOLDINGS, INC.
STATEMENTS OF INCOME BY REPORTABLE SEGMENT (UNAUDITED)
 
Three Months Ended December 31, 2015
 
Year Ended December 31, 2015
(Dollars in thousands)
Bank
Investment
Management
Parent
and Other
Consolidated
 
Bank
Investment
Management
Parent
and Other
Consolidated
Income statement data:
 
 
 
 
 
 
 
 
 
Interest income
$
21,760

$
—

$
86

$
21,846

 
$
82,958

$
—

$
249

$
83,207

Interest expense
3,759

—

553

4,312

 
13,448

—

2,195

15,643

Net interest income (loss)
18,001

—

(467
)
17,534

 
69,510

—

(1,946
)
67,564

Provision (credit) for loan losses
244

—

—

244

 
13

—

—

13

Net interest income (loss) after provision for loan losses
17,757

—

(467
)
17,290

 
69,497

—

(1,946
)
67,551

Non-interest income:
 
 
 
 
 
 
 
 
 
Investment management fees
—

7,482

(53
)
7,429

 
—

29,814

(196
)
29,618

Net gain on the sale of investment securities available-for-sale
16

—

—

16

 
33

—

—

33

Other non-interest income
1,676

(2
)
—

1,674

 
6,229

(8
)
—

6,221

Total non-interest income
1,692

7,480

(53
)
9,119

 
6,262

29,806

(196
)
35,872

Non-interest expense:
 
 
 
 
 
 
 
 
 
Intangible amortization expense
—

389

—

389

 
—

1,558

—

1,558

Other non-interest expense
12,228

5,471

(30
)
17,669

 
47,186

21,403

(104
)
68,485

Total non-interest expense
12,228

5,860

(30
)
18,058

 
47,186

22,961

(104
)
70,043

Income (loss) before tax
7,221

1,620

(490
)
8,351

 
28,573

6,845

(2,038
)
33,380

Income tax expense (benefit)
1,717

497

551

2,765

 
8,347

2,477

68

10,892

Net income (loss)
$
5,504

$
1,123

$
(1,041
)
$
5,586

 
$
20,226

$
4,368

$
(2,106
)
$
22,488



9
EXHIBIT 99

 
Three Months Ended December 31, 2014
 
Year Ended December 31, 2014
(Dollars in thousands)
Bank
Investment
Management
Parent
and Other
Consolidated
 
Bank
Investment
Management
Parent
and Other
Consolidated
Income statement data:
 
 
 
 
 
 
 
 
 
Interest income
$
20,870

$
—

$
63

$
20,933

 
$
77,803

$
—

$
110

$
77,913

Interest expense
2,889

—

528

3,417

 
11,134

—

1,117

12,251

Net interest income (loss)
17,981

—

(465
)
17,516

 
66,669

—

(1,007
)
65,662

Provision (credit) for loan losses
(209
)
—

—

(209
)
 
10,159

—

—

10,159

Net interest income (loss) after provision for loan losses
18,190

—

(465
)
17,725

 
56,510

—

(1,007
)
55,503

Non-interest income:
 
 
 
 
 
 
 
 
 
Investment management fees
—

7,735

(54
)
7,681

 
—

25,219

(157
)
25,062

Net gain on the sale of investment securities available-for-sale
—

—

—

—

 
1,428

—

—

1,428

Other non-interest income
1,148

1

—

1,149

 
5,193

38

—

5,231

Total non-interest income
1,148

7,736

(54
)
8,830

 
6,621

25,257

(157
)
31,721

Non-interest expense:
 
 
 
 
 
 
 
 
 
Intangible amortization expense
—

390

—

390

 
—

1,299

—

1,299

Acquisition earnout expense
—

1,614

—

1,614

 
—

1,614

—

1,614

Other non-interest expense
11,568

5,833

(27
)
17,374

 
43,115

18,338

(39
)
61,414

Total non-interest expense
11,568

7,837

(27
)
19,378

 
43,115

21,251

(39
)
64,327

Income (loss) before tax
7,770

(101
)
(492
)
7,177

 
20,016

4,006

(1,125
)
22,897

Income tax expense (benefit)
2,573

(199
)
(289
)
2,085

 
5,909

1,527

(467
)
6,969

Net income (loss)
$
5,197

$
98

$
(203
)
$
5,092

 
$
14,107

$
2,479

$
(658
)
$
15,928



10
EXHIBIT 99

TRISTATE CAPITAL HOLDINGS, INC.
NON-GAAP FINANCIAL MEASURES

The information set forth above contains certain financial information determined by methods other than in accordance with GAAP. These non-GAAP financial measures are “tangible equity,” “tangible equity to tangible assets,” “tangible book value per common share ,” “total revenue,” “pre-tax, pre-provision net revenue,” and “efficiency ratio.” Although we believe these non-GAAP financial measures provide a greater understanding of our business, these measures are not necessarily comparable to similar measures that may be presented by other companies.

“Tangible equity” is defined as shareholders’ equity reduced by intangible assets, including goodwill, if any. We believe this measure is important to management and investors to better understand and assess changes from period to period in shareholders’ equity exclusive of changes in intangible assets. Goodwill, an intangible asset that is recorded in a business purchase combination, has the effect of increasing both equity and assets, while not increasing our tangible equity or tangible assets.

“Tangible equity to tangible assets” is defined as the ratio of shareholders’ equity reduced by intangible assets, divided by total assets reduced by intangible assets. We believe this measure is important to many investors who are interested in relative changes from period to period in equity and total assets, each exclusive of changes in intangible assets.

“Tangible book value per common share” is defined as book value, excluding the impact of goodwill, if any, divided by common shares outstanding. We believe this measure is important to many investors who are interested in changes from period to period in book value per share exclusive of changes in intangible assets. Goodwill is an intangible asset that is recorded in a business purchase combination.

“Total revenue” is defined as net interest income and non-interest income, excluding gains and losses on sales of investment securities available-for-sale. We believe adjustments made to our operating revenue allow management and investors to better assess our operating revenue by removing the volatility that is associated with certain other items that are unrelated to our core business.

“Pre-tax, pre-provision net revenue” is defined as net income, without giving effect to loan loss provision and income taxes, and excluding net gain (loss) on sale of investment securities available-for-sale. We believe this measure is important because it allows management and investors to better assess our performance in relation to our core operating revenue, excluding the volatility that is associated with provision for loan losses or other items that are unrelated to our core business.

“Efficiency ratio” is defined as non-interest expense, excluding non-recurring acquisition related expenses and intangible amortization expense, where applicable, divided by our total revenue. We believe this measure, particularly at the Bank, allows management and investors to better assess our operating expenses in relation to our core operating revenue by removing the volatility that is associated with certain one-time items and other discrete items that are unrelated to our core business.


11
EXHIBIT 99

TRISTATE CAPITAL HOLDINGS, INC.
NON-GAAP FINANCIAL MEASURES (UNAUDITED)
 
December 31,
September 30,
December 31,
(Dollars in thousands, except per share data)
2015
2015
2014
Tangible equity to tangible assets:
 
 
 
Total shareholders' equity
$
325,977

$
320,540

$
305,390

Less: intangible assets
50,816

51,205

52,374

Tangible equity
$
275,161

$
269,335

$
253,016

Total assets
$
3,302,863

$
3,130,247

$
2,846,857

Less: intangible assets
50,816

51,205

52,374

Tangible assets
$
3,252,047

$
3,079,042

$
2,794,483

Tangible equity to tangible assets
8.46
%
8.75
%
9.05
%
 
 
 
 
Tangible book value per common share:
 
 
 
Tangible equity
$
275,161

$
269,335

$
253,016

Common shares outstanding
28,056,195

28,027,695

28,060,888

Tangible book value per common share
$
9.81

$
9.61

$
9.02


 
Three Months Ended
 
Years Ended
 
December 31,
September 30,
December 31,
 
December 31,
December 31,
(Dollars in thousands)
2015
2015
2014
 
2015
2014
Pre-tax, pre-provision net revenue:
 
 
 
 
 
 
Net interest income
$
17,534

$
16,956

$
17,516

 
$
67,564

$
65,662

Total non-interest income
9,119

8,064

8,830

 
35,872

31,721

Less: net gain on the sale of investment securities, available-for-sale
16

—

—

 
33

1,428

Total revenue
26,637

25,020

26,346

 
103,403

95,955

Less: total non-interest expense
18,058

17,301

19,378

 
70,043

64,327

Pre-tax, pre-provision net revenue
$
8,579

$
7,719

$
6,968

 
$
33,360

$
31,628

 
 
 
 
 
 
 
Efficiency ratio:
 
 
 
 
 
 
Total non-interest expense
$
18,058

$
17,301

$
19,378

 
$
70,043

$
64,327

Less: non-recurring acquisition related expenses
601

—

1,614

 
601

1,659

Less: intangible amortization expense
389

390

390

 
1,558

1,299

Total non-interest expense, as adjusted (numerator)
$
17,068

$
16,911

$
17,374

 
$
67,884

$
61,369

Total revenue (denominator)
$
26,637

$
25,020

$
26,346

 
$
103,403

$
95,955

Efficiency ratio
64.08
%
67.59
%
65.95
%
 
65.65
%
63.96
%
 
 
 
 
 
 
 


12
EXHIBIT 99

BANK SEGMENT
NON-GAAP FINANCIAL MEASURES (UNAUDITED)
 
Three Months Ended
 
Years Ended
 
December 31,
September 30,
December 31,
 
December 31,
December 31,
(Dollars in thousands)
2015
2015
2014
 
2015
2014
Bank pre-tax, pre-provision net revenue:
 
 
 
 
 
 
Net interest income
$
18,001

$
17,453

$
17,981

 
$
69,510

$
66,669

Total non-interest income
1,692

1,051

1,148

 
6,262

6,621

Less: net gain on the sale of investment securities, available-for-sale
16

—

—

 
33

1,428

Total revenue
19,677

18,504

19,129

 
75,739

71,862

Less: total non-interest expense
12,228

12,015

11,568

 
47,186

43,115

Pre-tax, pre-provision net revenue
$
7,449

$
6,489

$
7,561

 
$
28,553

$
28,747

 
 
 
 
 
 
 
Bank efficiency ratio:
 
 
 
 
 
 
Total non-interest expense
$
12,228

$
12,015

$
11,568

 
$
47,186

$
43,115

Less: non-recurring acquisition related expenses
—

—

—

 
—

45

Total non-interest expense, as adjusted (numerator)
$
12,228

$
12,015

$
11,568

 
$
47,186

$
43,070

Total revenue (denominator)
$
19,677

$
18,504

$
19,129

 
$
75,739

$
71,862

Efficiency ratio
62.14
%
64.93
%
60.47
%
 
62.30
%
59.93
%
 
 
 
 
 
 
 



13