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Bank of the Hills, National Association

Kerrville, TX · Cert 34636

FDIC

Q2 2006

Board Package

Performance Trends and Peer Comparison

Part 1Performance Trends, own institution only2
Part 2Peer Comparison, not published for this institution and quartern/a

Basis

Quarter: Q2 2006, the quarter ended June 30, 2006, on both parts.

Income statement: year to date as filed, annualized, on both parts.

Balance sheet: as filed at quarter end.

Peer group

No peer standings are published for this institution and quarter.

Peer groups below the disclosure floor are suppressed.

Source: FFIEC Call Report (031/041/051), as filed. Dollar figures derived from reported amounts in thousands. Ratios computed by CallReports.ai using published regulatory formulas.

CallReports · callreports.ai · Board PackageGenerated 2026-10-11

Bank of the Hills, National Association

Kerrville, TX · Cert 34636

FDIC

Q2 2006

$320.1MAssets
$147.6MLoans
$294.3MDeposits
$24.6MEquity
Deposit mix
85%Interest-bearing $248.9M15%Noninterest $45.5MQ2 2005Q2 2006

NIM

4.53%Q2 ’044.70%Q2 ’055.26%Q2 ’06-5%-5%

Non-interest income vs. expense

2.18%Q2 ’041.97%Q2 ’051.79%Q2 ’06-6%-16%

Executive Summary

  • Earnings: ROA of 1.61%, up 12 bps year over year; NIM at 3.12%.
  • Asset quality: problem loans at 0.00% of loans (0 bps YoY), with net charge-offs at 0.02%.
  • Funding: loans stand at 50.14% of deposits as of Q2 2006.

Financial Results

Return on Assets (YTD, annualized)

1.61%+12 bps YoY

Net Interest Margin (YTD, annualized)

3.12%-18 bps YoY

Efficiency Ratio (YTD, annualized)

46.47%-267 bps YoY

Tier 1 Leverage Ratio

n/a

Year to date, annualized, through each quarter.

MetricQ2 2005Q3 2005Q4 2005Q1 2006Q2 2006YoY ΔTrend
Earnings
Return on Assets1.49%1.52%1.56%1.54%1.61%+12 bps
Return on Equity20.88%21.17%21.84%21.28%21.80%+92 bps
Net Interest Margin3.31%3.23%2.99%3.16%3.12%-18 bps
Efficiency Ratio49.14%48.96%48.58%47.44%46.47%-267 bps
Non-Interest Burden1.26%1.22%1.11%1.12%1.07%-20 bps
Growth
Asset Growth (YoY)17.46%19.51%22.52%18.39%15.83%-163 bps
Loan Growth (YoY)14.31%9.85%6.87%8.46%4.22%-1,009 bps
Deposit Growth (YoY)15.48%19.35%22.51%17.96%16.85%+137 bps
Asset Quality
Nonperforming Loans / Loans0.00%0.00%0.00%0.00%0.00%0 bps
Net Charge-Offs / Loans0.01%0.01%0.02%0.01%0.02%+1 bps
Allowance / Loans1.43%1.45%1.48%1.46%1.46%+3 bps
Allowance Coverage of NPLsn/an/an/an/an/an/an/a
Capital
Tier 1 Leverage Ration/an/an/an/an/an/an/a
Total Risk-Based Capital13.62%13.84%14.28%14.30%15.18%+156 bps
Equity / Assets7.21%7.22%7.06%7.42%7.69%+47 bps
Liquidity & Funding
Loans / Deposits56.22%53.65%49.24%50.83%50.14%-608 bps
Liquid Assets / Assets41.18%40.26%40.78%43.36%45.18%+400 bps
CRE / Total Capitaln/an/an/an/an/an/an/a