800.644.1704 |

REGIONAL FINANCIAL SERVICES MERGERS & ACQUISITIONS UPDATE

SOUTHWEST REGION

Q3 2018

bkdcorporatefinance.com

REGIONAL M&A TRANSACTION STATISTICS

2

Number of Regional Whole Bank & Thrift Transactions

Regional Average Deal Value to Tangible Book

Regional Average Deal Value to LTM Earnings

Regional Average Deal Value to Assets Regional Average Tangible Book Premium to Core Deposits

Note: Includes all whole bank transactions in Colorado, Louisiana, New Mexico, Oklahoma, Texas and Utah Source: S&P Global Market Intelligence

bkdcorporatefinance.com

4049

38

26

40

2925

0

20

40

60

'13 '14 '15 '16 '17 YTD Sep '17 YTD Sep '18

1.371.51 1.59 1.63

1.78

2.06

0.0

0.5

1.0

1.5

2.0

2.5

'13 '14 '15 '16 '17 YTD Sep'18

20.01 19.9718.50

19.57

14.53

19.73

0

5

10

15

20

25

'13 '14 '15 '16 '17 YTD Sep'18

12.8%13.7% 13.9%

16.3% 16.7%

18.5%

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

20%

'13 '14 '15 '16 '17 YTD Sep'18

4.5%

6.3% 6.0%

10.0%

11.9% 11.9%

0%

2%

4%

6%

8%

10%

12%

14%

'13 '14 '15 '16 '17 YTD Sep'18

NATIONAL M&A TRANSACTION STATISTICS

3

National Average Deal Value to Tangible Book

National Average Deal Value to LTM Earnings

Number of National Whole Bank & Thrift Transactions

BKD CORPORATE

FINANCE SERVICES

• Company Sales & Divestitures • Management Buyouts

• Debt & Equity Recapitalizations

• Succession Planning & Strategic Options Analysis

• Mergers & Acquisitions • Affiliations

Source: S&P Global Market Intelligence

bkdcorporatefinance.com

144

110

186

148

219 225

284 275

239256

182199

0

50

100

150

200

250

300

'08 '09 '10 '11 '12 '13 '14 '15 '16 '17 YTD Sep'17

YTD Sep'18

1.7

1

1.1

6

1.1

8

1.1

0 1.2

0

1.2

5 1.4

3

1.4

4

1.3

8

1.6

7

1.7

3

0.0

0.2

0.4

0.6

0.8

1.0

1.2

1.4

1.6

1.8

2.0

'08 '09 '10 '11 '12 '13 '14 '15 '16 '17 YTDSep'18

19

.59

16

.26

21

.59

20

.35

18

.72

19

.50 21

.51

21

.05

20

.21

19

.46

23

.05

0

5

10

15

20

25

'08 '09 '10 '11 '12 '13 '14 '15 '16 '17 YTDSep'18

NATIONAL M&A TRANSACTION STATISTICS BY ASSET SIZE

4

National Average Deal Value to Tangible Book

National Average Deal Value to LTM Earnings

NATIONAL M&A TRANSACTION STATISTICS BY PERFORMANCE

National Average Deal Value to Tangible Book by Performance

National Average Deal Value to LTM Earnings by Performance*

Source: S&P Global Market Intelligence

*Deal value to LTM earnings for negative ROAA transactions are not meaningful and therefore are not presented in this chart

bkdcorporatefinance.com

1.1

8 1.3

9

1.3

6

1.2

8 1.5

4

1.5

9

1.6

6

1.6

5

1.9

3

1.7

6

2.1

4 2.3

5

0.00

0.50

1.00

1.50

2.00

2.50

'13 '14 '15 '16 '17 YTD Sep'18

Less than $1B Greater than $1B

20

.17

21

.49

21

.01

19

.66

18

.57 2

2.5

5

16

.29

21

.62

21

.20

22

.20

22

.16 24

.94

0.00

5.00

10.00

15.00

20.00

25.00

30.00

'13 '14 '15 '16 '17 YTD Sep'18

Less than $1B Greater than $1B

0.7

7

1.1

1

0.8

8

0.9

4 1.1

8

1.0

01.2

7 1.4

2

1.4

2

1.4

2 1.6

4

1.7

6

1.6

1

1.6

8

1.7

2

1.4

8

1.8

5

1.9

6

0.00

0.50

1.00

1.50

2.00

2.50

'13 '14 '15 '16 '17 YTD Sep'18

Negative ROAA ROAA of 0.0% to 0.99%

ROAA Greater than 1.0%

22

.41

24

.92

24

.08

23

.72

23

.57 2

7.8

7

11

.65

12

.37

14

.05

11

.05

13

.42

14

.11

0.00

5.00

10.00

15.00

20.00

25.00

30.00

'13 '14 '15 '16 '17 YTD Sep'18

ROAA of 0.0% to 0.99% ROAA Greater than 1.0%

NATIONAL BRANCH M&A TRANSACTION STATISTICS

5

Number of National Branch Transactions & Branches Sold

National Branch Average Franchise Premium to Deposits

Source: S&P Global Market Intelligence

bkdcorporatefinance.com

62 76 81 82 95 77 80 84 56 42 22 22

196

248

197

413389

288

424

269

121

102

69 115

0

50

100

150

200

250

300

350

400

450

0

10

20

30

40

50

60

70

80

90

100

'08 '09 '10 '11 '12 '13 '14 '15 '16 '17 YTD Sep'17

YTD Sep'18

Bra

nch

es

Sold

Tran

sact

ion

s

5.79%

3.12%

3.58%3.26%

2.52%2.68%

3.63%

2.79%

4.47% 4.58% 4.57%

0.00%

1.00%

2.00%

3.00%

4.00%

5.00%

6.00%

7.00%

'08 '09 '10 '11 '12 '13 '14 '15 '16 '17 YTD Sep'18

REGIONAL PUBLICLY TRADED BANKING COMPANIES

6

NATIONAL FAILED BANK STATISTICS

Source: S&P Global Market Intelligence

Source: Federal Deposit Insurance Corporation

bkdcorporatefinance.com

Name Ticker State Total Assets

($000)

Total Equity ($000)

Stock Price 9/30/2018

Price Change

YTD

Price to Tangible

Book

Price to LTM

Earnings

Dividend Yield

Return on Assets (%)

Return on Equity (%)

Equity/ Assets

(%)

Comerica Incorporated CMA TX 71,448,000 7,786,000 90.20 3.9% 207.29 16.86 2.66 1.79 16.27 10.90

Zions Bancorporation ZION UT 66,731,000 7,553,000 50.15 -1.3% 162.23 15.48 2.39 1.34 11.75 11.32

BOK Financial Corporation BOKF OK 33,289,864 3,625,760 97.28 5.3% 207.22 16.83 2.06 1.40 13.01 10.89

Cullen/Frost Bankers, Inc. CFR TX 31,223,402 3,308,246 104.44 10.3% 266.35 16.76 2.57 1.52 14.13 10.60

IBERIABANK Corporation IBKC LA 30,118,387 3,942,361 81.35 5.0% 185.94 26.58 1.92 1.35 10.31 13.09

Texas Capital Bancshares, Inc. TCBI TX 27,127,107 2,426,442 82.65 -7.0% 190.60 17.51 0.00 1.32 14.29 8.94

Prosperity Bancshares, Inc. PB TX 22,612,583 3,995,697 69.35 -1.0% 242.31 16.55 2.08 1.46 8.30 17.67

Hilltop Holdings Inc. HTH TX 13,764,536 1,964,158 20.17 -20.4% 117.24 19.21 1.39 1.07 7.67 14.27

International Bancshares Corp. IBOC TX 11,988,995 1,898,499 45.00 13.4% 186.30 15.73 1.87 1.83 11.73 15.84

Independent Bank Group, Inc. IBTX TX 9,891,464 1,567,184 66.30 -1.9% 262.81 18.62 0.84 1.42 9.19 15.84

LegacyTexas Financial Group, Inc. LTXB TX 9,082,792 1,039,599 42.60 0.9% 250.20 20.88 1.50 1.87 16.76 11.45

BancFirst Corporation BANF OK 7,602,438 884,801 59.95 17.2% 256.71 19.59 2.00 1.72 14.98 11.64

First Financial Bankshares, Inc. FFIN TX 7,571,231 995,739 59.10 31.2% 493.47 28.97 1.42 2.11 16.13 13.15

Southside Bancshares, Inc. SBSI TX 6,105,354 752,506 34.80 3.3% 230.24 18.81 3.45 1.31 10.69 12.33

National Bank Holdings Corp. NBHC CO 5,585,104 673,065 37.65 16.1% 217.59 52.29 1.49 1.31 10.88 12.05

Average 5.0% 231.77 21.38 1.84 1.52 12.41 12.66

25

140

157

92

51

2418

8 5 80

0

20

40

60

80

100

120

140

160

180

'08 '09 '10 '11 '12 '13 '14 '15 '16 '17 YTD Sep'18

ABOUT US

Construction &

Engineering

Financial

Services

Health

Care

Manufacturing

&

Distribution

Business

Services

Consumer

Services &

Products

Energy

Technology,

Media &

Telecom

INDUSTRY FOCUS

BKDCF, a wholly owned subsidiary of BKD, LLP, helps companies and stockholders go beyond their numbers by creating value through investment banking solutions that include mergers, acquisitions, sales, recapitalizations, management buyouts and financings.

Founded in 1994, BKDCF is staffed with experienced investment bankers and financial analysts. In addition, the firm draws on the resources of BKD with its network of accountants, auditors, tax professionals, business consultants and industry-specific consultants.

BKDCF is a member of the Financial Industry Regulatory Authority and the Securities Investor Protection Corporation.

The professionals of BKD Corporate Finance, LLC (BKDCF) have more than 200

years of combined experience helping company owners plan for and execute

their growth and exit strategies. From managing the sale of a company to

negotiating the acquisition of a competitor or raising debt and equity capital to

improve financial and operational flexibility, BKDCF can help you to develop a

specific course of action for achieving your desired results.

BKD/BKDCF OfficeBKD Office

FINANCIAL SERVICES CONTACT

7

Wyatt JenkinsVice PresidentSpringfield, MO417.865.8701wjenkins@bkd.com

bkdcorporatefinance.com

BKD SERVICES

Abundant services.

Sheer precision.

BKD, LLP offers a full range of services and industry-focused expertise to provide you with insightful solutions and help you stay a cut above the competition.

FINANCIAL

ASSURANCE• Audit, review & compilations• Benchmarking• Internal audit• Internal control studies• SEC filings• SOX 404 compliance

CONSULTING• Accounting outsourcing• Bankruptcy consulting• Budgeting & financial planning• Cost accounting• Employee benefit plan

structuring & administering• ESOP feasibility analysis• Forecasts & projections

FEDERAL & STATE TAX

PLANNING & COMPLIANCE• Compensation planning• Corporate tax planning• Inventory tax planning• R&D tax credit enhancements• Real estate cost segregation

studies• Restructuring planning• State & local tax planning

FORENSICS & VALUATION

CONSULTING• Bankruptcy services• Business valuations• Fraud prevention• Litigation support

INTERNATIONAL TAX

STRATEGIES• DISC• Expatriate assignment services• Foreign tax credit planning• Global structuring support• Indirect global taxes• Transfer pricing

INVESTMENT & FINANCIAL

PLANNING• Estate & gift planning• Family tax planning• Investment management• Personal wealth planning• Retirement planning

TRANSACTION SERVICES• Federal, state & local tax

diligence• Financial diligence• Operations diligence• Technology diligence

GROWTH & ADVISORY

INVESTMENT BANKING• Mergers & acquisitions• Company sales & divestitures• Debt & equity recapitalizations• Management buyouts• Affiliations• Succession planning• Strategic options analysis

ECONOMIC DEVELOPMENT• Expansion projects• Grants & public incentives

INTERNATIONAL MARKET• Development• Exporting• Direct investment• Licensing• Acquisitions

OPERATIONS MANAGEMENT

PERFORMANCE ENHANCEMENT

ADVICE & KNOW-HOW (PEAK)

METHODOLOGY• Business process improvement• Decision costing• Inventory optimization• Lean manufacturing• Profit improvement

TECHNOLOGY

APPLICATIONS SOFTWARE• Best-Abra• MAS 90, 200 & 500• Microsoft CRM• Microsoft Dynamics AX• Microsoft Dynamics GP

IT SERVICES• IT assessments & planning• IT control reviews• Project management assistance• Security solutions & penetration

testing

STRATEGIC TECHNOLOGY• E-business planning• IT assessments & planning• Systems selection & implementation

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