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): October 19, 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 October 19, 2016 , TriState Capital Holdings, Inc. issued a press release which disclosed results of operations for the three and nine months ended September 30, 2016 . A copy of the press release is included as Exhibit 99.1 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 8.01. Other Events.

On October 19, 2016 , TriState Capital Holdings, Inc. entered into a definitive agreement to acquire certain assets of Aberdeen Asset Management, Inc. Information regarding this agreement was disclosed in a press release dated October 19, 2016 . A copy of the press release is included as Exhibit 99.2 to this report.


Item 9.01.    Financial Statements and Exhibits.
Exhibit No.
Description
99.1
Press release dated October 19, 2016 , filed herewith, for item 2.02.
99.2
Press release dated October 19, 2016 , filed herewith, for item 8.01.

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: October 19, 2016


3


EXHIBIT INDEX


Exhibit No.
Description
99.1
Press release dated October 19, 2016 , filed herewith, for item 2.02.
99.2
Press release dated October 19, 2016 , filed herewith, for item 8.01.


4
EXHIBIT 99.1


FOR IMMEDIATE RELEASE




TRISTATE CAPITAL REPORTS THIRD QUARTER 2016 FINANCIAL RESULTS

PITTSBURGH, October 19, 2016 - TriState Capital Holdings, Inc. (NASDAQ: TSC) grew earnings per share (EPS) to $0.30 in the third quarter of 2016 , with EPS increasing 36.4% from the third quarter of 2015 and 25.0% from the second quarter of 2016 . The parent company of TriState Capital Bank and Chartwell Investment Partners also reported record revenue, net interest income and investment management fees, while continuing to drive strong loan and deposit growth, maintaining excellent credit quality, and enhancing its capital position.

TriState Capital’s net income grew to $8.5 million in the third quarter of 2016 , increasing 38.2% from $6.1 million in the third quarter of 2015 and 24.8% from $6.8 million in the second quarter of 2016 . Net income per diluted share was $0.30 in the third quarter of 2016 , compared to $0.22 in the third quarter of 2015 and $0.24 in the second quarter of 2016 . Third quarter 2016 earnings per share included approximately $0.03 from the reduction of previously accrued contingent consideration for The Killen Group (TKG) acquisition completed earlier this year.

“TriState Capital delivered its best quarterly financial results ever as a public company, showcasing our uniquely diversified and low-risk-profile financial services business model and its proven ability to consistently generate robust earnings through sustainable revenue growth in commercial banking, private banking and investment management,” Chief Executive Officer James F. Getz said. “We are also pleased to report further success in increasing the number and depth of client relationships that come with deposits, which outpaced very healthy loan growth for the third consecutive quarter, as well as further enhancements to our already strong regulatory capital position to support the continued organic expansion of our balance sheet.”

THIRD QUARTER 2016 HIGHLIGHTS
•
Deposits grew $486.7 million , or 18.7% , from one year prior and $199.0 million , or 6.9% , during the quarter to $3.09 billion , outpacing loan growth for the third consecutive quarter
•
Loans grew $513.5 million , or 19.3% , from one year prior and $177.3 million , or 5.9% , during the quarter to $3.17 billion , supporting TriState Capital’s ongoing long-term compound annual growth goal of 15%
•
Strong credit quality continued, with adverse-rated credits declining to 1.59% at period end, from 2.08% one year prior, and non-performing assets representing 0.67% of total assets at the end of the most-recent and year-ago quarters
•
Non-interest income grew to a record $12.5 million , or 40.0% of revenues, with Chartwell investment management revenue enhanced by the first full quarter of contribution from the TKG acquisition that closed April 29
•
Assets under management (AUM) grew 2.0% during the quarter to $10.8 billion
•
About $120 million of private banking loans became newly eligible for beneficial risk-weighted capital treatment under Basel III rules, making about $12 million of additional regulatory capital available to the bank

TriState Capital’s total revenue, net interest income (NII) and non-interest income each hit record quarterly levels in the three months ended September 30, 2016 . Total revenue grew to $31.2 million in the third quarter of 2016 , increasing 24.6% from $25.0 million in the year-ago quarter and 5.3% from $29.6 million in the linked quarter.

TriState Capital’s diverse loan growth continues to support revenue expansion, even as net interest margin of 2.18% in the third quarter of 2016 reflects the lingering impact of the sustained low-rate environment, in light of the company’s continued commitment to asset sensitivity and strong credit quality in loans and investments. NII grew to $18.7 million in the third quarter of 2016 , increasing 10.0% from $17.0 million in the third quarter of 2015 and 2.7% from $18.2 million in the linked quarter.

Investment management fees of $10.3 million in the third quarter of 2016 reflected Chartwell’s successful business development efforts, as well as the contributions of the TKG business acquired on April 29. Chartwell investment management fees were $7.0 million in the year-ago quarter and $9.4 million in the linked quarter.


1
EXHIBIT 99.1

All other non-interest income was $2.2 million in the third quarter of 2016 , compared to $995,000 in the year-ago quarter and $2.0 million in the linked quarter. Total non-interest income was $12.5 million , or 40.0% of total revenue, in the third quarter of 2016 , compared to $8.0 million , or 32.0% , in the year-ago period and $11.4 million , or 38.5% , in the linked quarter.

The bank’s efficiency ratio for the third quarter of 2016 was 62.01% , compared to 64.93% in the third quarter of 2015 and 59.63% in the second quarter of 2016 . Non-interest expenses in the third quarter of 2016 were $20.5 million , or 2.27% of average assets on an annualized basis, compared to $17.3 million , or 2.25% , in the third quarter of 2015 . Second quarter 2016 non-interest expenses were $19.5 million , or 2.29% of average assets on an annualized basis.

Non-interest expense for the three months ended September 30, 2016 represents the first full quarter of compensation and other costs associated with operating the business acquired from TKG on April 29. Third quarter non-interest expense also reflected a reduction of $1.2 million in the fair value of previously accrued contingent consideration associated with the TKG acquisition. The adjustment of this non-cash accrual reflects management’s current estimate of the earnout payable to TKG’s former owners in 2017, which favorably impacted third quarter 2016 earnings per share by approximately $0.03.

TriState Capital lowered its projected effective tax rate for the full year 2016 from approximately 34% to approximately 31% as a result of tax credits generated in the third quarter.

BALANCE SHEET GROWTH
Loans totaled $3.17 billion at September 30, 2016 , increasing $513.5 million , or 19.3% , over balances at September 30, 2015 and $177.3 million , or 5.9% , from June 30 . Private banking loans totaled $1.59 billion at September 30, 2016 , growing 32.3% from the end of the year-ago quarter and 10.6% from the end of the linked quarter. Commercial loans totaled $1.59 billion at September 30, 2016 , growing 8.6% from the end of the year-ago quarter and 1.7% from the end of the linked quarter.

Deposits totaled $3.09 billion at September 30, 2016 , increasing $486.7 million , or 18.7% , from September 30, 2015 and $199.0 million , or 6.9% , from June 30 . Deposit growth outpaced robust loan growth for the third consecutive quarter. This illustrates the ongoing success of TriState Capital’s efforts to grow stable and cost-effective relationship deposits and treasury management related liquidity from new and existing accounts through superior client focus and enhanced services and technology.

TriState Capital continues to manage a highly asset-sensitive balance sheet. At September 30, 2016 , 87% of TriState Capital’s loan portfolio and 51% of its securities portfolio were floating rate. In addition, 28% of deposits were fixed-rate time deposits.

ASSET QUALITY
The bank’s solid asset quality metrics in the third quarter of 2016 continued to reflect TriState Capital’s disciplined credit culture and the growth of its private banking non-purpose margin loans secured by marketable securities. Private banking comprised 50% of the total loan portfolio at September 30, 2016 .

Non-performing assets (NPAs) were $25.0 million at September 30, 2016 , or 0.67% of total assets, compared to $20.9 million , or 0.67% of assets, at September 30, 2015 and $20.9 million , or 0.59% , at June 30, 2016 . NPAs at September 30, 2016 included $3.6 million for collateral moved to other real estate owned (OREO) at fair value. Non-performing loans (NPLs) were $20.7 million at September 30, 2016 , or 0.65% of total loans, compared to $19.1 million , or 0.72% , at September 30, 2015 and $19.1 million , or 0.64% , at June 30, 2016 .

Adverse-rated credits declined 10.7% during the third quarter and 8.6% from September 30, 2015 . Adverse-rated credits represented 1.59% of total loans at the end of the third quarter of 2016 , 2.08% at September 30, 2015 and 1.89% at June 30, 2016 .

The bank experienced net recoveries of $3.5 million in the third quarter of 2016 , compared to net charge-off of $716,000 in the third quarter of 2015 and $1.4 million in the second quarter of 2016 .


2
EXHIBIT 99.1

TriState Capital’s $542,000 credit to provision expense in the three months ended September 30, 2016 reflected declining adverse rated credits and net recoveries, offset by increases to specific reserves on NPLs. The bank reported a credit to provision expense of $1.3 million in the third quarter of 2015 and provision expense of $80,000 in the second quarter of 2016 .

The company’s allowance for loan losses represented 0.64% of total loans at September 30, 2016 , compared to 0.73% at September 30, 2015 and 0.57% at June 30, 2016 .

INVESTMENT MANAGEMENT
Chartwell’s new business and new flows from existing accounts of $189 million and market appreciation of $400 million offset outflows of $381 million in the third quarter of 2016 . While Chartwell experienced net outflows of $192 million in the third quarter, it delivered net inflows of $416 million year to date, as the industry generally saw net outflows for the three and nine months ended September 30, 2016 .

Chartwell grew AUM by 2.0% to $10.8 billion at the end of the third quarter of 2016 from $10.6 billion at June 30, 2016 . AUM grew by 41.6% from $7.6 billion at September 30, 2015 , primarily driven by the April 29 closing of its TKG acquisition. Chartwell’s weighted average fee rate was 0.38% at September 30, 2016 .

Investment management fees grew to $10.3 million in the third quarter of 2016 from $7.0 million in the third quarter of 2015 and $9.4 million in the second quarter of 2016 . On an annualized run-rate basis, Chartwell’s revenues increased to $41.3 million at September 30, 2016 , up 47.5% from $28.0 million at September 30, 2015 and in line with $41.2 million at June 30, 2016 .

Chartwell earned $1.7 million in the third quarter, comprising 20.6% of TriState Capital Holdings’ consolidated net income for the third quarter of 2016 .

CAPITAL STRENGTH AND FLEXIBILITY
During the third quarter of 2016, about $120 million of TriState Capital’s private banking loans became newly eligible for beneficial risk-weighted capital treatment under Basel III rules, which recognize the lower-risk profile of the majority of the bank’s portfolio of non-purpose margin loans. This had the favorable net effect of making about $12 million of additional regulatory capital available to the bank in the third quarter of 2016. Accordingly, the TriState Capital Bank subsidiary’s total risk-based capital ratio increased to 12.88% at September 30, 2016 , from 12.24% at June 30, 2016 .

TriState Capital Holdings, as of September 30, 2016 , reported ratios of 13.05% for total risk-based capital, 11.73% for tier 1 risk-based capital, 11.73% for common equity tier 1 risk-based capital and 8.09% for tier 1 leverage.

In January 2016 , the Board of Directors approved a share repurchase program of up to $10 million . Year-to-date, the company repurchased a total of 334,275 shares for approximately $4.3 million at an average cost of $12.89 per share. Of that total, in the third quarter of 2016 , the company repurchased 76,553 shares for approximately $1.1 million at an average cost of $14.78 per share. Also during the third quarter, $5.2 million of the authorization was utilized for an option cancellation program. Fully vested options of 1,061,500 shares of common stock, granted in 2007 and expiring in 2017 with a $10 exercise price, were canceled at an average spread of $4.92 .

This week, the company’s Board of Directors approved a new share repurchase program of up to $5 million. Under the authorization, purchases of shares may be made at the discretion of management from time to time in the open market or through negotiated transactions. In addition, the funds allocated to the program can be used to cancel options expiring in 2017.

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 October 20 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/10094279 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

3
EXHIBIT 99.1

earnings 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 through October 27 . 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 international locations, and entering the conference number 10094279.

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 had $3.6 billion in assets, as of September 30, 2016 , 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 had $10.8 billion in assets under management, as of September 30, 2016 , and serves as the advisor to The Berwyn Funds and Chartwell Mutual Funds. 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 CONTACT
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 99.1

TRISTATE CAPITAL HOLDINGS, INC.
SELECTED FINANCIAL HIGHLIGHTS (UNAUDITED)
 
As of and For the 
 Three Months Ended
 
As of and For the 
 Nine Months Ended
(Dollars in thousands)
September 30,
June 30,
September 30,
 
September 30,
September 30,
 
2016
2016
2015
 
2016
2015
Period-end balance sheet data:
 
 
 
 
 
 
Cash and cash equivalents
$
120,736

$
114,297

$
100,424

 
$
120,736

$
100,424

Total investment securities
243,343

242,217

228,014

 
243,343

228,014

Loans held-for-investment
3,174,653

2,997,309

2,661,191

 
3,174,653

2,661,191

Allowance for loan losses
(20,211
)
(17,215
)
(19,350
)
 
(20,211
)
(19,350
)
Loans held-for-investment, net
3,154,442

2,980,094

2,641,841

 
3,154,442

2,641,841

Goodwill and other intangibles, net
67,671

68,134

51,205

 
67,671

51,205

Other assets
129,326

123,849

108,020

 
129,326

108,020

Total assets
$
3,715,518

$
3,528,591

$
3,129,504

 
$
3,715,518

$
3,129,504

 
 
 
 
 
 
 
Total deposits
$
3,087,230

$
2,888,192

$
2,600,508

 
$
3,087,230

$
2,600,508

Borrowings, net
239,460

259,409

174,257

 
239,460

174,257

Other liabilities
45,689

43,296

34,199

 
45,689

34,199

Total liabilities
3,372,379

3,190,897

2,808,964

 
3,372,379

2,808,964

 
 
 
 
 
 
 
Total shareholders' equity
343,139

337,694

320,540

 
343,139

320,540

 
 
 
 
 
 
 
Total liabilities and shareholders' equity
$
3,715,518

$
3,528,591

$
3,129,504

 
$
3,715,518

$
3,129,504

 
 
 
 
 
 
 
Income statement data:
 
 
 
 
 
 
Interest income
$
24,925

$
23,795

$
20,989

 
$
72,080

$
61,672

Interest expense
6,221

5,576

3,984

 
16,780

11,331

Net interest income
18,704

18,219

17,005

 
55,300

50,341

Provision (credit) for loan losses
(542
)
80

(1,341
)
 
(340
)
(231
)
Net interest income after provision for loan losses
19,246

18,139

18,346

 
55,640

50,572

Non-interest income:
 
 
 
 
 
 
Investment management fees
10,333

9,462

7,020

 
26,814

22,189

Net gain on the sale and call of investment securities
14

62

—

 
77

17

Other non-interest income
2,150

1,923

995

 
5,968

4,236

Total non-interest income
12,497

11,447

8,015

 
32,859

26,442

Non-interest expense:
 
 
 
 
 
 
Intangible amortization expense
463

438

390

 
1,291

1,169

Change in fair value of acquisition earnout
(1,209
)
—

—

 
(1,209
)
—

Other non-interest expense
21,260

19,019

16,911

 
57,895

50,816

Total non-interest expense
20,514

19,457

17,301

 
57,977

51,985

Income before tax
11,229

10,129

9,060

 
30,522

25,029

Income tax expense
2,775

3,356

2,942

 
9,452

8,127

Net income
$
8,454

$
6,773

$
6,118

 
$
21,070

$
16,902



5
EXHIBIT 99.1

TRISTATE CAPITAL HOLDINGS, INC.
SELECTED FINANCIAL HIGHLIGHTS (UNAUDITED)
 
As of and For the 
 Three Months Ended
 
As of and For the 
 Nine Months Ended
(Dollars in thousands, except per share data)
September 30,
June 30,
September 30,
 
September 30,
September 30,
 
2016
2016
2015
 
2016
2015
Per share and share data:
 
 
 
 
 
 
Earnings per share:
 
 
 
 
 
 
Basic
$
0.31

$
0.25

$
0.22

 
$
0.76

$
0.61

Diluted
$
0.30

$
0.24

$
0.22

 
$
0.75

$
0.60

Book value per common share
$
12.12

$
11.97

$
11.44

 
$
12.12

$
11.44

Tangible book value per common share (1)
$
9.73

$
9.56

$
9.61

 
$
9.73

$
9.61

Common shares outstanding, at end of period
28,317,154

28,211,282

28,027,695

 
28,317,154

28,027,695

Weighted average common shares outstanding:
 
 
 
 
 
 
Basic
27,514,724

27,549,475

27,728,705

 
27,586,816

27,779,023

Diluted
28,307,632

28,225,404

28,281,244

 
28,276,223

28,207,659

 
 
 
 
 
 
 
Performance ratios:
 
 
 
 
 
 
Return on average assets (2)
0.93
 %
0.80
%
0.79
%
 
0.82
 %
0.76
%
Return on average equity (2)
9.88
 %
8.16
%
7.64
%
 
8.42
 %
7.23
%
Net interest margin (2) (3)
2.18
 %
2.25
%
2.32
%
 
2.25
 %
2.39
%
Bank efficiency ratio (1)
62.01
 %
59.63
%
64.93
%
 
60.36
 %
62.36
%
Efficiency ratio (1)
68.17
 %
64.24
%
67.59
%
 
65.73
 %
66.20
%
Non-interest expense to average assets (2)
2.27
 %
2.29
%
2.25
%
 
2.25
 %
2.35
%
 
 
 
 
 
 
 
Asset quality:
 
 
 
 
 
 
Non-performing loans
$
20,717

$
19,148

$
19,119

 
$
20,717

$
19,119

Non-performing assets
$
24,985

$
20,878

$
20,885

 
$
24,985

$
20,885

Other real estate owned
$
4,268

$
1,730

$
1,766

 
$
4,268

$
1,766

Non-performing assets to total assets
0.67
 %
0.59
%
0.67
%
 
0.67
 %
0.67
%
Non-performing loans to total loans
0.65
 %
0.64
%
0.72
%
 
0.65
 %
0.72
%
Allowance for loan losses to loans
0.64
 %
0.57
%
0.73
%
 
0.64
 %
0.73
%
Allowance for loan losses to non-performing loans
97.56
 %
89.90
%
101.21
%
 
97.56
 %
101.21
%
Net charge-offs (recoveries)
$
(3,538
)
$
1,411

$
716

 
$
(2,577
)
$
692

Net charge-offs (recoveries) to average total loans (2)
(0.46
)%
0.20
%
0.11
%
 
(0.12
)%
0.04
%
 
 
 
 
 
 
 
Revenue:
 
 
 
 
 
 
Total revenue (1)
$
31,187

$
29,604

$
25,020

 
$
88,082

$
76,766

Pre-tax, pre-provision net revenue (1)
$
10,673

$
10,147

$
7,719

 
$
30,105

$
24,781

 
 
 
 
 
 
 
Capital ratios:
 
 
 
 
 
 
Tier 1 leverage ratio
8.09
 %
8.41
%
9.30
%
 
8.09
 %
9.30
%
Common equity tier 1 risk-based capital ratio
11.73
 %
11.25
%
12.22
%
 
11.73
 %
12.22
%
Tier 1 risk-based capital ratio
11.73
 %
11.25
%
12.22
%
 
11.73
 %
12.22
%
Total risk-based capital ratio
13.05
 %
12.76
%
13.99
%
 
13.05
 %
13.99
%
 
 
 
 
 
 
 
Assets under management
$
10,800,000

$
10,592,000

$
7,625,000

 
$
10,800,000

$
7,625,000


(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 99.1

TRISTATE CAPITAL HOLDINGS, INC.
AVERAGES AND YIELDS (UNAUDITED)
 
Three Months Ended
 
September 30, 2016
 
June 30, 2016
 
September 30, 2015
(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
$
114,245

$
150

0.52
%
 
$
105,954

$
135

0.51
%
 
$
94,015

$
84

0.35
%
Federal funds sold
6,445

6

0.37
%
 
6,041

5

0.33
%
 
6,197

2

0.13
%
Investment securities available-for-sale
182,354

828

1.81
%
 
185,477

816

1.77
%
 
172,922

597

1.37
%
Investment securities held-to-maturity
48,495

485

3.98
%
 
45,143

457

4.07
%
 
45,941

454

3.92
%
FHLB stock
12,347

144

4.64
%
 
11,984

102

3.42
%
 
6,371

49

3.05
%
Total loans
3,061,427

23,369

3.04
%
 
2,909,217

22,354

3.09
%
 
2,598,362

19,872

3.03
%
Total interest-earning assets
3,425,313

24,982

2.90
%
 
3,263,816

23,869

2.94
%
 
2,923,808

21,058

2.86
%
Other assets
171,986

 
 
 
157,736

 
 
 
132,225

 
 
Total assets
$
3,597,299

 
 
 
$
3,421,552

 
 
 
$
3,056,033

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Liabilities and Shareholders' Equity
 
 
 
 
 
 
 
 
 
 
 
Interest-bearing deposits:
 
 
 
 
 
 
 
 
 
 
 
Interest-bearing checking accounts
$
190,270

$
234

0.49
%
 
$
145,858

$
154

0.42
%
 
$
97,493

$
99

0.40
%
Money market deposit accounts
1,688,250

3,017

0.71
%
 
1,603,881

2,622

0.66
%
 
1,418,547

1,523

0.43
%
Time deposits
863,872

1,936

0.89
%
 
852,381

1,827

0.86
%
 
884,829

1,652

0.74
%
Borrowings:
 
 
 
 
 
 
 
 
 
 
 
FHLB borrowing
273,804

480

0.70
%
 
269,670

419

0.62
%
 
130,054

156

0.48
%
Subordinated notes payable, net
34,427

554

6.40
%
 
34,376

554

6.48
%
 
34,224

554

6.42
%
Total interest-bearing liabilities
3,050,623

6,221

0.81
%
 
2,906,166

5,576

0.77
%
 
2,565,147

3,984

0.62
%
Noninterest-bearing deposits
161,723

 
 
 
147,540

 
 
 
148,323

 
 
Other liabilities
44,565

 
 
 
34,075

 
 
 
24,743

 
 
Shareholders' equity
340,388

 
 
 
333,771

 
 
 
317,820

 
 
Total liabilities and shareholders' equity
$
3,597,299

 
 
 
$
3,421,552

 
 
 
$
3,056,033

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net interest income (1)
 
$
18,761

 
 
 
$
18,293

 
 
 
$
17,074

 
Net interest spread
 
 
2.09
%
 
 
 
2.17
%
 
 
 
2.24
%
Net interest margin  (1)
 
 
2.18
%
 
 
 
2.25
%
 
 
 
2.32
%

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

7
EXHIBIT 99.1

TRISTATE CAPITAL HOLDINGS, INC.
AVERAGES AND YIELDS (UNAUDITED)
 
Nine Months Ended September 30,
 
2016
 
2015
(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
$
107,651

$
418

0.52
%
 
$
104,953

$
273

0.35
%
Federal funds sold
6,180

16

0.35
%
 
6,143

4

0.09
%
Investment securities available-for-sale
181,383

2,387

1.76
%
 
162,838

1,550

1.27
%
Investment securities held-to-maturity
46,977

1,409

4.01
%
 
40,616

1,190

3.92
%
FHLB stock
10,983

343

4.17
%
 
5,084

311

8.18
%
Total loans
2,935,663

67,710

3.08
%
 
2,510,374

58,534

3.12
%
Total interest-earning assets
3,288,837

72,283

2.94
%
 
2,830,008

61,862

2.92
%
Other assets
155,903

 
 
 
130,591

 
 
Total assets
$
3,444,740

 
 
 
$
2,960,599

 
 
 
 
 
 
 
 
 
 
Liabilities and Shareholders' Equity
 
 
 
 
 
 
 
Interest-bearing deposits:
 
 
 
 
 
 
 
Interest-bearing checking accounts
$
160,310

$
541

0.45
%
 
$
103,674

$
318

0.41
%
Money market deposit accounts
1,614,669

7,847

0.65
%
 
1,343,867

4,079

0.41
%
Time deposits
869,879

5,540

0.85
%
 
883,679

4,945

0.75
%
Borrowings:
 
 
 
 
 
 
 
FHLB borrowing
243,686

1,191

0.65
%
 
103,315

328

0.42
%
Subordinated notes payable, net
34,376

1,661

6.45
%
 
34,174

1,661

6.50
%
Total interest-bearing liabilities
2,922,920

16,780

0.77
%
 
2,468,709

11,331

0.61
%
Noninterest-bearing deposits
153,763

 
 
 
149,224

 
 
Other liabilities
33,770

 
 
 
30,026

 
 
Shareholders' equity
334,287

 
 
 
312,640

 
 
Total liabilities and shareholders' equity
$
3,444,740

 
 
 
$
2,960,599

 
 
 
 
 
 
 
 
 
 
Net interest income (1)
 
$
55,503

 
 
 
$
50,531

 
Net interest spread
 
 
2.17
%
 
 
 
2.31
%
Net interest margin  (1)
 
 
2.25
%
 
 
 
2.39
%

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

TRISTATE CAPITAL HOLDINGS, INC.
LOAN COMPOSITION (UNAUDITED)
 
September 30, 2016
 
June 30, 2016
 
September 30, 2015
(Dollars in thousands)
Loan
Balance
Percent of
Total Loans
 
Loan
Balance
Percent of
Total Loans
 
Loan
Balance
Percent of
Total Loans
Private banking loans
$
1,587,019

50.0
%
 
$
1,435,545

47.9
%
 
$
1,199,883

45.1
%
Middle-market banking loans:
 
 
 
 
 
 
 
 
Commercial and industrial
565,702

17.8
%
 
573,733

19.1
%
 
630,131

23.7
%
Commercial real estate
1,021,932

32.2
%
 
988,031

33.0
%
 
831,177

31.2
%
Total middle-market banking loans
1,587,634

50.0
%
 
1,561,764

52.1
%
 
1,461,308

54.9
%
Loans held-for-investment
$
3,174,653

100.0
%
 
$
2,997,309

100.0
%
 
$
2,661,191

100.0
%


8
EXHIBIT 99.1

TRISTATE CAPITAL HOLDINGS, INC.
STATEMENT OF INCOME BY REPORTABLE SEGMENT (UNAUDITED)
 
Three Months Ended September 30, 2016
 
Three Months Ended September 30, 2015
(Dollars in thousands)
Bank
Investment
Management
Parent
and Other
Consolidated
 
Bank
Investment
Management
Parent
and Other
Consolidated
Income statement data:
 
 
 
Interest income
$
24,855

$
—

$
70

$
24,925

 
$
20,932

$
—

$
57

$
20,989

Interest expense
5,673

—

548

6,221

 
3,430

—

554

3,984

Net interest income (loss)
19,182

—

(478
)
18,704

 
17,502

—

(497
)
17,005

Provision (credit) for loan losses
(542
)
—

—

(542
)
 
(1,341
)
—

—

(1,341
)
Net interest income (loss) after provision for loan losses
19,724

—

(478
)
19,246

 
18,843

—

(497
)
18,346

Non-interest income:
 
 
 
 
 
 
 
 
 
Investment management fees
—

10,391

(58
)
10,333

 
—

7,074

(54
)
7,020

Net gain on the sale and call of investment securities
14

—

—

14

 
—

—

—

—

Other non-interest income
2,149

1

—

2,150

 
1,002

(7
)
—

995

Total non-interest income
2,163

10,392

(58
)
12,497

 
1,002

7,067

(54
)
8,015

Non-interest expense:
 
 
 
 
 
 
 
 
 
Intangible amortization expense
—

463

—

463

 
—

390

—

390

Change in fair value of acquisition earnout
—

(1,209
)
—

(1,209
)
 
—

—

—

—

Other non-interest expense
13,227

8,009

24

21,260

 
12,015

4,936

(40
)
16,911

Total non-interest expense
13,227

7,263

24

20,514

 
12,015

5,326

(40
)
17,301

Income (loss) before tax
8,660

3,129

(560
)
11,229

 
7,830

1,741

(511
)
9,060

Income tax expense (benefit)
1,823

1,385

(433
)
2,775

 
2,442

660

(160
)
2,942

Net income (loss)
$
6,837

$
1,744

$
(127
)
$
8,454

 
$
5,388

$
1,081

$
(351
)
$
6,118



9
EXHIBIT 99.1

 
Nine Months Ended September 30, 2016
 
Nine Months Ended September 30, 2015
(Dollars in thousands)
Bank
Investment
Management
Parent
and Other
Consolidated
 
Bank
Investment
Management
Parent
and Other
Consolidated
Income statement data:
 
 
 
Interest income
$
71,871

$
—

$
209

$
72,080

 
$
61,509

$
—

$
163

$
61,672

Interest expense
15,130

—

1,650

16,780

 
9,689

—

1,642

11,331

Net interest income (loss)
56,741

—

(1,441
)
55,300

 
51,820

—

(1,479
)
50,341

Provision (credit) for loan losses
(340
)
—

—

(340
)
 
(231
)
—

—

(231
)
Net interest income (loss) after provision for loan losses
57,081

—

(1,441
)
55,640

 
52,051

—

(1,479
)
50,572

Non-interest income:
 
 
 
 
 
 
 
 
 
Investment management fees
—

26,981

(167
)
26,814

 
—

22,332

(143
)
22,189

Net gain on the sale and call of investment securities
77

—

—

77

 
17

—

—

17

Other non-interest income
5,966

2

—

5,968

 
4,242

(6
)
—

4,236

Total non-interest income
6,043

26,983

(167
)
32,859

 
4,259

22,326

(143
)
26,442

Non-interest expense:
 
 
 
 
 
 
 
 
 
Intangible amortization expense
—

1,291

—

1,291

 
—

1,169

—

1,169

Change in fair value of acquisition earnout
—

(1,209
)
—

(1,209
)
 
—

—

—

—

Other non-interest expense
37,849

19,986

60

57,895

 
34,958

15,931

(73
)
50,816

Total non-interest expense
37,849

20,068

60

57,977

 
34,958

17,100

(73
)
51,985

Income (loss) before tax
25,275

6,915

(1,668
)
30,522

 
21,352

5,226

(1,549
)
25,029

Income tax expense (benefit)
7,476

2,833

(857
)
9,452

 
6,630

1,981

(484
)
8,127

Net income (loss)
$
17,799

$
4,082

$
(811
)
$
21,070

 
$
14,722

$
3,245

$
(1,065
)
$
16,902


10
EXHIBIT 99.1

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 common equity,” “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 common equity” is defined as shareholders’ equity reduced by intangible assets, including goodwill. 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 book value per common share” is defined as book value, excluding the impact of intangible assets, including goodwill, 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.

“Total revenue” is defined as net interest income and non-interest income, excluding gains and losses on the sale and call of investment securities. 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 gains and losses on the sale and call of investment securities. 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 acquisition related items 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 99.1

TRISTATE CAPITAL HOLDINGS, INC.
NON-GAAP FINANCIAL MEASURES (UNAUDITED)
 
September 30,
June 30,
September 30,
(Dollars in thousands, except per share data)
2016
2016
2015
Tangible book value per common share:
 
 
 
Total shareholders' equity
$
343,139

$
337,694

$
320,540

Less: intangible assets
67,671

68,134

51,205

Tangible common equity
$
275,468

$
269,560

$
269,335

Common shares outstanding
28,317,154

28,211,282

28,027,695

Tangible book value per common share
$
9.73

$
9.56

$
9.61


 
Three Months Ended
 
Nine Months Ended
 
September 30,
June 30,
September 30,
 
September 30,
September 30,
(Dollars in thousands)
2016
2016
2015
 
2016
2015
Pre-tax, pre-provision net revenue:
 
 
 
 
 
 
Net interest income
$
18,704

$
18,219

$
17,005

 
$
55,300

$
50,341

Total non-interest income
12,497

11,447

8,015

 
32,859

26,442

Less: net gain on the sale and call of investment securities
14

62

—

 
77

17

Total revenue
31,187

29,604

25,020

 
88,082

76,766

Less: total non-interest expense
20,514

19,457

17,301

 
57,977

51,985

Pre-tax, pre-provision net revenue
$
10,673

$
10,147

$
7,719

 
$
30,105

$
24,781

 
 
 
 
 
 
 
Efficiency ratio:
 
 
 
 
 
 
Total non-interest expense
$
20,514

$
19,457

$
17,301

 
$
57,977

$
51,985

Plus: change in fair value of acquisition earnout
1,209

—

—

 
1,209

—

Less: acquisition related items
—

—

—

 
1

—

Less: intangible amortization expense
463

438

390

 
1,291

1,169

Total non-interest expense, as adjusted (numerator)
$
21,260

$
19,019

$
16,911

 
$
57,894

$
50,816

Total revenue (denominator)
$
31,187

$
29,604

$
25,020

 
$
88,082

$
76,766

Efficiency ratio
68.17
%
64.24
%
67.59
%
 
65.73
%
66.20
%

BANK SEGMENT
NON-GAAP FINANCIAL MEASURES (UNAUDITED)
 
Three Months Ended
 
Nine Months Ended
 
September 30,
June 30,
September 30,
 
September 30,
September 30,
(Dollars in thousands)
2016
2016
2015
 
2016
2015
Bank pre-tax, pre-provision net revenue:
 
 
 
 
 
 
Net interest income
$
19,182

$
18,705

$
17,502

 
$
56,741

$
51,820

Total non-interest income
2,163

1,984

1,002

 
6,043

4,259

Less: net gain on the sale and call of investment securities
14

62

—

 
77

17

Total revenue
21,331

20,627

18,504

 
62,707

56,062

Less: total non-interest expense
13,227

12,299

12,015

 
37,849

34,958

Pre-tax, pre-provision net revenue
$
8,104

$
8,328

$
6,489

 
$
24,858

$
21,104

 
 
 
 
 
 
 
Bank efficiency ratio:
 
 
 
 
 
 
Total non-interest expense (numerator)
$
13,227

$
12,299

$
12,015

 
$
37,849

$
34,958

Total revenue (denominator)
$
21,331

$
20,627

$
18,504

 
$
62,707

$
56,062

Efficiency ratio
62.01
%
59.63
%
64.93
%
 
60.36
%
62.36
%

12
EXHIBIT 99.2






FOR IMMEDIATE RELEASE


TRISTATE CAPITAL TO ACCELERATE GROWTH OF ITS CHARTWELL INVESTMENT PARTNERS SUBSIDIARY THROUGH TRANSACTION WITH ABERDEEN ASSET MANAGEMENT, INC.

-- Brings expanded product capability and about $4 billion in client assets to Chartwell as
TriState Capital executes strategy to complement strong organic growth of its
investment management business with selective acquisitions --

PITTSBURGH, October 19, 2016 - TriState Capital Holdings, Inc. (NASDAQ: TSC) entered into a definitive agreement to acquire certain assets from Aberdeen Asset Management Inc. in a transaction designed to expand the fixed income investment team and product offering of the bank holding company’s Chartwell Investment Partners business.

Institutional accounts with about $4 billion in client assets under management (AUM) are expected to move from Aberdeen to Chartwell upon closing of the transaction. The six Philadelphia-based investment professionals who currently manage these domestic fixed-income assets have agreed to join Chartwell’s team upon transaction closing.

Following a strategic review of its U.S. Fixed Income business, Aberdeen decided to exit the U.S. Core and Core Plus business. Aberdeen agreed to dispose of this business to Chartwell because of its strong infrastructure and their local presence which facilitates continuity of management. This should ensure a smooth transition for clients.

“We are excited to be able to add these proven investment professionals to Chartwell’s team for the benefit of their current clients, as well as the growing list of institutional and retail investors we serve,” TriState Capital Chief Executive Officer James F. Getz said. “We intend to put our powerful financial services distribution network to work for our new team members’ taxable fixed-income offering, as well as leverage the scalable infrastructure and administrative personnel already in place at Chartwell today.”

Before the effect of the transaction announced today, Chartwell’s $10.8 billion in AUM on Sept. 30, 2016 reflected successful business development efforts driving strong net inflows since its acquisition by TriState Capital in the first quarter of 2014, coupled with the second quarter 2016 purchase of The Killen Group (TKG), advisor to The Berwyn Funds.

With assets acquired from Aberdeen, Chartwell would have pro forma AUM of about $14.8 billion and pro forma annualized run rate revenue of approximately $48.8 million at Sept. 30, 2016. With the acquired assets, Chartwell investment management fees as a percentage of total holding company revenue would be approximately 37%, on a pro forma basis at Sept. 30, 2016.

“This is an outstanding opportunity to acquire domestic fixed-income assets and bring the seasoned investment professionals running them to our team,” said Chartwell Managing Partner and Chief Executive Officer Timothy J. Riddle. “This transaction also illustrates Chartwell’s growing reputation in the marketplace and our ability to attract top investment professionals who share our vision for offering a comprehensive array of products, while meeting and exceeding our clients’ expectations for performance and service.”

“We are delighted to have agreed to this transaction, as it is beneficial to both parties and ensures a good outcome for all clients. Chartwell is getting a domestic fixed-income business managed by an experienced team. For Aberdeen, the sale allows us to apply greater focus on our U.S. Credit, Total Return Bond and High Yield strategies,” said Aberdeen’s Co-Head of the Americas, Bev Hendry.

Aberdeen and the board of directors of TriState Capital have approved the transaction. Closing is anticipated by the first quarter of 2017, subject to regulatory requirements, certain Aberdeen-client consents, and other customary closing conditions and adjustments.

In conjunction with the transaction, Aberdeen investment professionals joining Chartwell have signed restrictive employment agreements with TriState Capital’s investment management subsidiary. Upon closing of the deal, they will be based at Chartwell’s offices in the Main Line Philadelphia suburb of Berwyn, Pa.

1
EXHIBIT 99.2



TriState Capital’s legal advisor on the transaction was Keevican Weiss Bauerle & Hirsch LLC, and Stephens Inc. provided a fairness opinion.

CONFERENCE CALL
TriState Capital will discuss today’s transaction announcement on a previously scheduled third quarter financial results conference call, tomorrow. The live conference call on October 20 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/10094279 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 earnings 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 through October 27. 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 international locations, and entering the conference number 10094279.

A slide presentation with additional information on the transaction will be available at http://investors.tristatecapitalbank.com .

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 had $3.6 billion in assets, as of September 30, 2016, 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 had $10.8 billion in assets under management, as of September 30, 2016, and serves as the advisor to The Berwyn Funds and Chartwell Mutual Funds. 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.

###

MEDIA CONTACT
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

2