Report Reassures Texans: State's Banks Still Outperforming Those Around the Nation

Report Reassures Texans: State's Banks Still Outperforming Those Around the
Nation

AUSTIN, Texas, May 19 /PRNewswire/ -- While rising foreclosures and job losses
will impact Texas banks for at least the next two quarters of the year, banks
in the state continue to perform better than those around the nation,
according to a report issued by Sheshunoff and Co. Investment Banking
(http://www.smslp.com/investment-banking/), a leading merger and acquisitions
advisory firm for the banking industry.

In its performance review of Texas banks during the first quarter of 2009,
Sheshunoff found that profitability of Texas banks has improved, asset quality
(a measure of the percentage of problems loans a banks holds) is at less than
half the national average, and regulatory capital levels continue to be much
stronger when compared to banks throughout the nation.

"This first quarter review showed us what we expected to see, and in many ways
it provides a reassurance about the state of our banks," said Sheshunoff and
Co. Investment Banking Managing Director Curtis Carpenter
(http://budurl.com/curt). "Our banks remain well capitalized, and while
earnings are down in some markets, Texas banks are - for the most part -
performing very, very well."

Carpenter did not dismiss the current economic conditions. "We're going to see
at least two more quarters of softening economic trends," he conjectured.
"While the economy may improve, I think we will still see rising foreclosures
and job losses that will impact the banks."

The Sheshunoff report - Texas Bank Performance Review for Q1 2009
(http://budurl.com/Q4perf) - shows that the banks in the Dallas/Fort Worth
area are performing below the national level, and that those in San Antonio
and in rural areas are the best performers in the state. For example:
-- Profitability of Texas banks was up in the first quarter, and - with
the
exception of the Dallas/Fort Worth and Houston areas - remains
well-above national levels.
-- Asset quality is strong, particularly in Houston (.37 percent) and
non-metro areas. Dallas at 1.43 percent is still suffering along with
the rest of the nation.

-- Regulatory capital levels in both the state and the nation trended
slightly up. Rural areas had the highest regulatory capital levels in
the state. The San Antonio area reported the highest levels for metro
areas and El Paso the lowest.

According to Sheshunoff and Co. Investment Banking Associate Director John
Blaylock, the recent rainfall has helped banks in rural markets. "The crops
Texans produce have a significant impact on what happens to our banks. If we
can sustain this production through the summer, our farmers - and subsequently
our rural banks - will have a reasonably good year."

At the same time Blaylock said that Houston's current performance has been the
topic of speculation from those in the industry who worry that the drop in
energy prices hasn't filtered through to the banks.

Blaylock credited the optimism of many Sheshunoff clients to their size. "Our
clients are the smaller independent banks. Many commercial businesses that
need loans are turning to independent banks where they can get their credit
needs met. Larger national banks are simply not lending or their terms are
difficult to meet."

Smaller banks will be offered more capital from the Treasury Department when
it reopens its Troubled Assets Relief Program (TARP). The Department announced
this week that funds for the program will be dispersed to banks with total
assets under $500 million. The TARP, however, has grown increasingly
unattractive to most banks based on the ever-changing rules, Blaylock
explained.

To view the Sheshunoff and Co. Investment Banking report on Texas Bank
Performance Review for the First Quarter of 2009, visit:
http://budurl.com/Q4perf.

About Sheshunoff & Co. Investment Banking
Sheshunoff & Co. Investment Banking, a leader in community bank merger and
acquisition transactions and valuation services, has acted as financial
advisor in more than 200 transactions in the past 15 years. The group has a
30-year record of advising financial institutions nationwide, offering merger
and acquisition advisory services, valuations, restructuring, and strategic
options assessments. For more information, visit
http://www.smslp.com/investment-banking/.

SOURCE Sheshunoff & Co. Investment Banking

Stephanie Schultz of Diverge Communications, +1-512-750-3202,
sschultz@divergedigital.com, for Sheshunoff & Co. Investment Banking