GlobeNewswire Inc | Apr 28, 2021 04:01PM EDT

April 28, 2021

HOUSTON, April 28, 2021 (GLOBE NEWSWIRE) -- CBTX, Inc., or the Company (NASDAQ: CBTX), the bank holding company for CommunityBank of Texas, N.A., or the Bank, today announced its results for the first quarter of 2021.

Robert R. Franklin, Jr., Chairman, CEO and President of the Company stated, During the first quarter of 2021, our markets continued to improve as companies worked toward returning to pre-pandemic operation. Every day we see more people returning to work as businesses create healthy work environments for both employees and customers. We have seen tremendous liquidity in the system, and our deposits continued to grow through the first quarter of 2021. We anticipate that as the economy recovers, we will see more of that liquidity put to work by our customers and the bank.

Mr. Franklin concluded, Our loan portfolio remains strong with little deferral activity remaining. We will continue to work with customers in the hardest hit segments of the economy that will take a little longer to recover. We are also mindful to enhance our shareholders return as we increased our quarterly dividend from $0.10 per share to $0.13 per share. We are optimistic about the second half of the year as markets attempt to recapture some of the lost revenues of the last year. Our balance sheet and capital remain strong which gives us many options going forward to drive shareholder value.

Highlights

-- Net income was $10.0 million for the first quarter of 2021, or $0.41 per diluted share, compared to $10.2 million, or $0.41 per diluted share, for the quarter ended December 31, 2020 and $7.5 million, or $0.30 per diluted share, for the quarter ended March 31, 2020. -- Total deposits were $3.4 billion at March 31, 2021, an increase of $83.0 million compared to $3.3 billion at December 31, 2020. -- Maintained a solid net interest margin on a tax equivalent basis of 3.71% for the quarter ended March 31, 2021. -- Nonperforming assets remained low at 0.59% of total assets at March 31, 2021, compared to 0.61% of total assets at December 31, 2020. -- Increased quarterly dividend to $0.13 per share from $0.10 per share.

Operating Results

Net Interest Income

Net interest income was $33.1 million for the first quarter of 2021, compared to $32.5 million for the fourth quarter of 2020 and $32.2 million for the first quarter of 2020. Net interest income increased $570,000 during the first quarter of 2021, compared to the fourth quarter of 2020, primarily due to higher loan rates and lower deposit rates, partially offset by the impact of two fewer days and lower average loans in the first quarter of 2021. Net interest income increased $870,000 during the first quarter of 2021, compared to the first quarter of 2020, primarily due to higher average loans, securities and other interest-earning assets and lower deposit rates, partially offset by lower rates on loans, securities and other interest-earning assets and the impact of one less day in the first quarter of 2021.

The yield on interest-earning assets was 3.85% for the first quarter of 2021, compared to 3.79% for the fourth quarter of 2020 and 4.56% for the first quarter of 2020. The cost of interest-bearing liabilities was 0.34% for the first quarter of 2021, 0.39% for the fourth quarter of 2020 and 0.94% for the first quarter of 2020. The Companys net interest margin on a tax equivalent basis was 3.71% for the first quarter of 2021, compared to 3.62% for the fourth quarter of 2020 and 4.06% for the first quarter of 2020.

Provision/Recapture for Credit Losses

The provision for credit losses was $412,000 for the first quarter of 2021, compared to a credit reserve recapture of $135,000 for the fourth quarter of 2020 and a provision for credit losses of $5.0 million for the first quarter of 2020.

The provision for credit losses for the first quarter of 2021 was primarily due to increases of $237,000 and $126,000 in the ACL for loans and unfunded commitments, respectively, in addition to $49,000 in net loan charge-offs. The recapture in the fourth quarter of 2020 primarily related to a $364,000 recapture for unfunded commitments, partially offset by a provision of $229,000 for loans. The provision for credit losses for the first quarter of 2020 resulted from the impact of the COVID-19 pandemic and the sustained instability of the oil and gas industry which led to the adjustment of certain factors utilized to determine the ACL.

The ACL for loans was $40.9 million, or 1.41% of loans excluding loans held for sale, at March 31, 2021, compared to $40.6 million, or 1.39% of loans excluding loans held for sale, at December 31, 2020 and $31.2 million, or 1.17% of loans excluding loans held for sale, at March 31, 2020. At March 31, 2021, there were minimal adjustments to the qualitative factors utilized in calculating the ACL. The increase in the ACL from December 31, 2020 to March 31, 2021 was primarily due to an increase in specific reserves for loans individually evaluated within the portfolio and a slight increase in the general reserve. Although the collectively evaluated loan portfolio decreased $27.3 million compared to December 31, 2020, the general reserve increased $14,000 because balances in certain portfolio segments with higher historical loss rates and higher qualitative factor rates increased as a component of the overall portfolio resulting in an increase in the ACL. The increase in the ACL from March 31, 2020 to March 31, 2021 was primarily due to the impact of the COVID-19 pandemic and the sustained instability of the oil and gas industry during 2020.

The ACL for unfunded commitments was $4.3 million at March 31, 2021, compared to $4.2 million at December 31, 2020 and $3.7 million at March 31, 2020.

Noninterest Income

Noninterest income was $3.1 million for the first quarter of 2021, $3.5 million for the fourth quarter of 2020 and $4.3 million for the first quarter of 2020. The decrease of $1.2 million for the first quarter of 2021, compared to the first quarter of 2020, was primarily due to swap origination fee income recognized in 2020.

Noninterest Expense

Noninterest expense was $23.3 million for the first quarter of 2021, compared to $23.7 million for the fourth quarter of 2020 and $22.1 million for the first quarter of 2020. The decrease in noninterest expense of $373,000 between the first quarter of 2021 and the fourth quarter of 2020 was primarily due to a $1.5 million decrease in professional and director fees, mainly consulting fees related to Bank Secrecy Act/Anti-Money Laundering, or BSA/AML, compliance matters, partially offset by a $1.3 million increase in salaries and employee benefits reflecting reductions to bonus accruals in the fourth quarter of 2020. Total consulting related fees associated with BSA/AML compliance matters were $661,000 in the first quarter of 2021, compared to $2.4 million in the fourth quarter of 2020.

The increase in noninterest expense of $1.2 million for the first quarter of 2021, compared to the first quarter of 2020, was primarily due to a $551,000 increase in professional and director fees, a $354,000 increase in data processing and software and a $453,000 increase in regulatory fees. The increase in professional and director fees during the first quarter of 2021, compared to the first quarter of 2020, was primarily due to $661,000 in consulting related fees associated with BSA/AML compliance matters recognized in the first quarter of 2021.

Income Taxes

Income tax expense was $2.5 million for the first quarter of 2021, $2.3 million for the fourth quarter of 2020 and $1.9 million for the first quarter of 2020. The effective tax rates were 19.87% for the first quarter of 2021, 18.24% for the fourth quarter of 2020 and 19.85% for the first quarter of 2020. The differences between the federal statutory rate of 21% and the effective tax rates were largely attributable to permanent differences primarily related to tax exempt interest and bank-owned life insurance earnings.

Balance Sheet Highlights

Loans

Loans excluding loans held for sale were $2.9 billion at March 31, 2021, $2.9 billion at December 31, 2020 and $2.7 billion at March 31, 2020.

The increase from March 31, 2020 to March 31, 2021 was impacted by the Companys participation in the Paycheck Protection Program, or PPP, under the Coronavirus Aid, Relief and Economic Security Act, or CARES Act, which facilitates loans to small businesses. PPP loans, net of deferred fees and unearned discounts, were $268.8 million at March 31, 2021 and $271.2 million at December 31, 2020.

In support of customers impacted by the COVID-19 pandemic, the Company offered relief through payment deferrals during 2020 and the first quarter of 2021. As of March 31, 2021, the Company had 16 loans subject to such deferral arrangements with total outstanding principal balances of $34.3 million and as of December 31, 2020 the Company had 21 loans subject to such deferral arrangements with total outstanding principal balances of $38.4 million.

Asset Quality

Nonperforming assets remain relatively low at $23.6 million, or 0.59% of total assets, at March 31, 2021, $24.0 million, or 0.61% of total assets, at December 31, 2020 and $1.4 million, or 0.04% of total assets, at March 31, 2020.

Annualized net charge-offs (recoveries) to average loans was 0.01% for the first quarter of 2021, 0.49% for the fourth quarter of 2020 and (0.05)% for the first quarter of 2020.

Deposits and Borrowings

Total deposits were $3.4 billion at March 31, 2021, $3.3 billion at December 31, 2020 and $2.8 billion at March 31, 2020. The increase in deposits of $83.0 million between December 31, 2020 and March 31, 2021 was due to net deposit inflows of $145.0 million in noninterest-bearing accounts partially offset by net deposit outflows of $62.0 million in interest-bearing accounts. The increase in deposits of $592.5 million between March 31, 2020 and March 31, 2021 was due to net deposit inflows of $425.9 million and $166.6 million in noninterest-bearing accounts and interest-bearing accounts, respectively.

The Company defines total borrowings as the total of repurchase agreements, Federal Home Loan Bank advances and notes payable. Total borrowings were $50.0 million, $50.0 million and $51.4 million at March 31, 2021, December 31, 2020 and March 31, 2020, respectively.

Capital

At March 31, 2021, the Company continued to be well capitalized and maintained strong capital ratios under bank regulatory requirements. The Companys total risk-based capital ratio was 17.00% at March 31, 2021, compared to 16.71% at December 31, 2020 and 16.42% at March 31, 2020. The Companys tier 1 leverage ratio was 11.90% at March 31, 2021, compared to 12.00% at December 31, 2020 and 13.18% at March 31, 2020. The Companys total shareholders equity to total assets ratio was 13.54% at March 31, 2021, 13.84% at December 31, 2020 and 15.67% at March 31, 2020.

The ratio of tangible equity to tangible assets was 11.67% at March 31, 2021, 11.94% at December 31, 2020 and 13.51% at March 31, 2020. Tangible equity to tangible assets is a non-GAAP financial measure. The most directly comparable financial measure calculated in accordance with United States generally accepted accounting principles, or GAAP, to tangible equity to tangible assets is total shareholders equity to total assets. See the table captioned NonGAAP to GAAP Reconciliation at the end of this earnings release.

Non-GAAP Financial Measures

The Companys accounting and reporting policies conform to GAAP and the prevailing practices in the banking industry. The Companys management also evaluates performance based on certain non-GAAP financial measures. The Company classifies a financial measure as being a non-GAAP financial measure if that financial measure excludes or includes amounts, or is subject to adjustments that have the effect of excluding or including amounts, that are not included or excluded in the most directly comparable measure calculated and presented in accordance with GAAP as in effect from time to time in the United States in its statements of income, balance sheets or statements of cash flows.

This earnings release contains certain non-GAAP financial measures including tangible book value, tangible book value per common share, and tangible equity to tangible assets, which are supplemental measures that are not required by, or are not presented in accordance with, GAAP. Non-GAAP financial measures do not include operating, other statistical measures or ratios calculated using exclusively financial measures calculated in accordance with GAAP. Non-GAAP financial measures should not be considered in isolation or as a substitute for the most directly comparable or other financial measures calculated in accordance with GAAP. Moreover, the way we calculate the non-GAAP financial measures may differ from that of other companies reporting measures with similar names.

Please refer to the table titled Non-GAAP to GAAP Reconciliation at the end of this earnings release for a reconciliation of these non-GAAP financial measures.

Conference Call Information

The Company will hold a conference call to discuss results for the quarter ended March 31, 2021 on April 29, 2021 at 8:00 a.m. Central Standard Time. Investors and interested parties may listen to the teleconference via telephone by calling (877) 620-1733 if calling from the U.S. or Canada (or (470) 414-9785 if calling from outside the U.S.). The conference call ID number is 9087182. To access the live webcast of the conference call, individuals can visit the Investor Relations page of the Companys website: https://ir.cbtxinc.com/events-and-presentations. An archived edition of the earnings webcast will also be posted on the Companys website later that day and will remain available to interested parties via the same link for one year.

The conference call will contain forward-looking statements in addition to statements of historical fact. The actual achievement of any forecasted results or the unfolding of future economic or business developments in a way anticipated or projected by the Company involves numerous risks and uncertainties that may cause the Companys actual performance to be materially different from that stated or implied in the forward-looking statements. Such risks and uncertainties include, among other things, risks discussed within the Risk Factors section of the Companys most recent Forms 10-Q and 10-K and subsequent 8-Ks.

About CBTX, Inc.

CBTX, Inc. is the bank holding company for CommunityBank of Texas, N.A., a community bank, offering commercial banking solutions to small and mid-sized businesses and professionals in Houston, Dallas, Beaumont and surrounding communities in Texas. Visit www.communitybankoftx.com for more information.

Forward-Looking Statements

This earnings release may contain certain forward-looking statements within the meaning of the securities laws that are based on various facts and derived utilizing important assumptions, current expectations, estimates and projections about the Company and its subsidiary. Forward-looking statements include information regarding the Companys future financial performance, business and growth strategy, projected plans and objectives, as well as projections of macroeconomic and industry trends, which are inherently unreliable due to the multiple factors that impact economic trends, and any such variations may be material. Statements preceded by, followed by or that otherwise include the words believes, expects, anticipates, intends, projects, estimates, plans and similar expressions or future or conditional verbs such as will, should, would, may and could are generally forward-looking in nature and not historical facts, although not all forward-looking statements include the foregoing. Further, certain factors that could affect our future results and cause actual results to differ materially from those expressed in the forward-looking statements include, but are not limited to: the Companys ability to manage the economic risks related to the impact of the COVID-19 pandemic and the sustained instability in the oil and gas industry (including risks related to its customers credit quality, deferrals and modifications to loans, the Companys ability to borrow, and the impact of a resultant recession generally); natural disasters and adverse weather (including the effects of recent hurricanes, tropical storms, tropical depressions and winter storms on the Companys market area), acts of war or terrorism, pandemics, an outbreak of hostilities or other international or domestic calamities and other matters beyond the Companys control; the geographic concentration of the Companys markets in Beaumont and Houston, Texas; the Companys ability to manage changes and the continued health or availability of management personnel; the amount of nonperforming and classified assets that the Company holds and the time and effort necessary to resolve nonperforming assets; deterioration of asset quality; interest rate risk associated with the Companys business; national business and economic conditions in general and in the financial services industry, and within the Companys primary markets; volatility and direction of oil prices, including risks related to the collapse and instability in oil prices, and the strength of the energy industry, generally and within Texas; the composition of the Companys loan portfolio, including the identity of the Companys borrowers and the concentration of loans in specialized industries, including the creditworthiness of energy company borrowers; changes in the value of collateral securing the Companys loans; the Companys ability to maintain important deposit customer relationships and its reputation; the Companys ability to maintain effective internal control over financial reporting; the Companys ability to pursue available remedies in the event of a loan default for PPP loans and the risk of holding such loans at unfavorable interest rates and on terms that are less favorable than those with customers to whom the Company would have otherwise lent; the volatility and direction of market interest rates; liquidity risks associated with the Companys business; systems failures, interruptions or breaches involving the Companys information technology and telecommunications systems or thirdparty servicers; the failure of certain third-party vendors to perform; the initiation and outcome of litigation and other legal proceedings against the Company or to which it may become subject; the operational risks associated with the Companys business; the costs, effects and results of regulatory examinations, investigations, including the ongoing investigation by the Financial Crimes Enforcement Network of the U.S. Department of Treasury, or FinCEN, or reviews or the ability to obtain the required regulatory approvals; the Companys ability to meet the requirements of its Formal Agreement with the Office of the Comptroller of the Currency, and the risk that such Formal Agreement may have a negative impact on the Companys financial performance and results of operations; changes in the laws, rules, regulations, interpretations or policies relating to financial institution, accounting, tax, trade, monetary and fiscal matters; governmental or regulatory responses to the COVID-19 pandemic and newly enacted fiscal stimulus that impact the Companys loan portfolio and forbearance practice; and further government intervention in the U.S. financial system that may impact how the Company achieves its performance goals. Additionally, many of these risks and uncertainties are currently elevated by and may or will continue to be elevated by the COVID-19 pandemic. The foregoing factors should not be construed as exhaustive and should be read together with the other cautionary statements included in the Companys Annual Report on Form 10-K, filed with the Securities and Exchange Commission, or SEC, and other reports and statements that the Company has filed with the SEC. If one or more events related to these or other risks or uncertainties materialize, or if the Companys underlying assumptions prove to be incorrect, actual results may differ materially from what it anticipates. Accordingly, you should not place undue reliance on any such forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made, and the Company does not undertake any obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise. New factors emerge from time to time, and it is not possible for the Company to predict which will arise. In addition, the Company cannot assess the impact of each factor on its business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. Copies of the SEC filings for the Company are available for download free of charge from www.communitybankoftx.comunder the Investor Relations tab.

CBTX,INC. AND SUBSIDIARYFinancial Highlights (In thousands, except per share data and percentages)

Three Months Ended 3/31/2021 12/31/2020 9/30/2020 6/30/2020 3/31/2020Profitability: Net income $ 10,019 $ 10,236 $ 6,421 $ 2,163 $ 7,541 Basic earnings $ 0.41 $ 0.42 $ 0.26 $ 0.09 $ 0.30 per shareDilutedearnings per $ 0.41 $ 0.41 $ 0.26 $ 0.09 $ 0.30 share Return onaverage assets 1.03 % 1.05 % 0.66 % 0.23 % 0.87 %^(1)Return onaverage 7.39 % 7.47 % 4.70 % 1.60 % 5.64 %shareholders'equity^(1)Net interestmargin - tax 3.71 % 3.62 % 3.55 % 3.68 % 4.06 %equivalent^(1)Efficiency 64.32 % 65.64 % 66.77 % 64.15 % 60.44 %ratio^(2) Liquidity andCapital Ratios:Totalshareholders' 13.54 % 13.84 % 14.18 % 13.77 % 15.67 %equity tototal assetsTangibleequity to 11.67 % 11.94 % 12.22 % 11.84 % 13.51 %tangibleassets^(3)Common equitytier 1 capital 15.75 % 15.45 % 15.41 % 15.30 % 15.23 %ratioTier 1risk-based 15.75 % 15.45 % 15.41 % 15.30 % 15.23 %capital ratioTotalrisk-based 17.00 % 16.71 % 16.67 % 16.56 % 16.42 %capital ratioTier 1 11.90 % 12.00 % 11.90 % 11.96 % 13.18 %leverage ratio Credit Quality:Allowance forcredit lossesfor loans toloans 1.41 % 1.39 % 1.49 % 1.35 % 1.17 %excludingloans held forsaleNonperformingassets to 0.59 % 0.61 % 0.41 % 0.29 % 0.04 %total assetsNonperformingloans to loansexcluding 0.81 % 0.82 % 0.53 % 0.38 % 0.05 %loans held forsaleNetcharge-offs(recoveries) 0.01 % 0.49 % 0.02 % 0.01 % (0.05 )%to averageloans^(1) Other Data: Weightedaverage commonshares 24,508 24,621 24,748 24,752 24,926 outstanding -basicWeightedaverage commonshares 24,616 24,678 24,770 24,780 25,000 outstanding -dilutedCommon sharesoutstanding at 24,442 24,613 24,713 24,755 24,746 period endDividends per $ 0.13 $ 0.10 $ 0.10 $ 0.10 $ 0.10 shareBook value per $ 22.31 $ 22.20 $ 21.89 $ 21.71 $ 21.70 shareTangible bookvalue per $ 18.84 $ 18.74 $ 18.44 $ 18.26 $ 18.23 share^(3)Employees -full-time 517 511 515 523 512 equivalents

^ ^Annualized.(1)^ ^Efficiency ratio represents noninterest expense divided by the sum of net(2) interest income and noninterest income.^ ^Non?GAAP financial measure. See the table captioned ?Non?GAAP to GAAP(3) Reconciliation? at the end of this earnings release.

CBTX,INC. AND SUBSIDIARYCondensed Consolidated Balance Sheets (In thousands)

3/31/2021 12/31/2020 9/30/2020 6/30/2020 3/31/2020 Loans excluding $ 2,891,632 $ 2,924,117 $ 2,964,526 $ 2,934,888 $ 2,671,587 loans held for saleAllowance forcredit losses for (40,874 ) (40,637 ) (44,069 ) (39,678 ) (31,194 )loansLoans, net 2,850,758 2,883,480 2,920,457 2,895,210 2,640,393 Cash and 604,671 538,007 377,572 492,400 284,898 equivalentsSecurities 289,091 237,281 226,101 235,438 234,014 Premises and 60,551 61,152 61,732 50,729 50,243 equipmentGoodwill 80,950 80,950 80,950 80,950 80,950 Other intangible 3,991 4,171 4,303 4,496 4,700 assetsLoans held for sale 1,005 2,673 1,763 - 882 Operating lease 12,900 13,285 12,893 14,081 12,577 right-to-use assetOther assets 124,722 128,218 128,901 128,421 116,993 Total assets $ 4,028,639 $ 3,949,217 $ 3,814,672 $ 3,901,725 $ 3,425,650 Noninterest-bearing $ 1,621,408 $ 1,476,425 $ 1,460,983 $ 1,513,748 $ 1,195,541 depositsInterest-bearing 1,763,339 1,825,369 1,709,681 1,740,455 1,596,692 depositsTotal deposits 3,384,747 3,301,794 3,170,664 3,254,203 2,792,233 Federal Home Loan 50,000 50,000 50,000 50,000 50,000 Bank advancesRepurchase ? ? 2,153 2,500 1,415 agreementsOperating lease 16,060 16,447 15,759 16,983 15,356 liabilitiesOther liabilities 32,483 34,525 35,175 40,683 29,772 Total liabilities 3,483,290 3,402,766 3,273,751 3,364,369 2,888,776 Total shareholders? 545,349 546,451 540,921 537,356 536,874 equityTotal liabilitiesand shareholders? $ 4,028,639 $ 3,949,217 $ 3,814,672 $ 3,901,725 $ 3,425,650 equity

CBTX,INC. AND SUBSIDIARYCondensed Consolidated Statements of Income (In thousands)

Three Months Ended 3/31/2021 12/31/2020 9/30/2020 6/30/2020 3/31/2020Interest income Interest and $ 33,165 $ 32,886 $ 32,318 $ 32,857 $ 33,617 fees on loansSecurities 1,173 1,070 1,107 1,228 1,363 Otherinterest-earning 177 168 176 169 1,055 assetsEquity 146 170 162 171 176 investmentsTotal interest 34,661 34,294 33,763 34,425 36,211 incomeInterest expense Deposits 1,350 1,549 1,831 2,022 3,766 Federal HomeLoan Bank 221 221 221 240 221 advancesOtherinterest-bearing ? 4 3 5 4 liabilitiesTotal interest 1,571 1,774 2,055 2,267 3,991 expenseNet interest 33,090 32,520 31,708 32,158 32,220 incomeProvision(recapture) for credit lossesProvision forcredit losses 286 229 4,569 8,537 4,739 for loansProvision(recapture) forcredit losses 126 (364 ) (461 ) 1,333 310 for unfundedcommitmentsTotal provision(recapture) for 412 (135 ) 4,108 9,870 5,049 credit lossesNet interestincome afterprovision 32,678 32,655 27,600 22,288 27,171 (recapture) forcredit lossesNoninterest incomeDeposit account 1,193 1,270 1,176 1,095 1,485 service chargesCard interchange 976 999 995 915 922 feesEarnings onbank-owned life 390 407 1,187 412 416 insuranceNet gain on 192 379 114 139 123 sales of assetsOther 360 467 551 348 1,381 Totalnoninterest 3,111 3,522 4,023 2,909 4,327 incomeNoninterest expenseSalaries andemployee 14,188 12,848 14,332 14,012 14,223 benefitsOccupancy 2,521 2,628 2,496 2,558 2,424 expenseProfessional and 1,703 3,209 2,446 1,541 1,152 director feesData processing 1,576 1,330 1,525 1,292 1,222 and softwareRegulatory fees 556 748 471 476 103 Advertising,marketing and 285 438 429 269 364 businessdevelopmentTelephone and 463 455 486 392 419 communicationsSecurity andprotection 390 423 299 351 374 expenseAmortization of 191 197 198 230 221 intangiblesOther expenses 1,412 1,382 1,176 1,374 1,587 Totalnoninterest 23,285 23,658 23,858 22,495 22,089 expenseNet incomebefore income 12,504 12,519 7,765 2,702 9,409 tax expenseIncome tax 2,485 2,283 1,344 539 1,868 expenseNet income $ 10,019 $ 10,236 $ 6,421 $ 2,163 $ 7,541

CBTX,INC. AND SUBSIDIARYNet Interest Margin (In thousands, except percentages)

Three Months Ended 3/31/2021 12/31/2020 3/31/2020 Average Interest Average Average Interest Average Average Interest Average Outstanding Earned/ Yield/ Outstanding Earned/ Yield/ Outstanding Earned/ Yield/ Balance Interest Rate^ Balance Interest Rate^ Balance Interest Rate^ Paid (1) Paid (1) Paid (1)Assets Interest-earning assets: Total loans^(2) $ 2,901,291 $ 33,165 4.64 % $ 2,961,622 $ 32,886 4.42 % $ 2,634,507 $ 33,617 5.13 %Securities 259,341 1,173 1.84 % 236,233 1,070 1.80 % 233,917 1,363 2.34 %Other interest-earning assets 475,279 177 0.15 % 388,936 168 0.17 % 315,099 1,055 1.35 %Equity investments 15,353 146 3.86 % 15,346 170 4.41 % 13,661 176 5.18 %Total interest-earning assets 3,651,264 $ 34,661 3.85 % 3,602,137 $ 34,294 3.79 % 3,197,184 $ 36,211 4.56 %Allowance for credit losses (41,078 ) (44,233 ) (25,831 ) for loansNoninterest-earning assets 321,334 321,303 296,698 Total assets $ 3,931,520 $ 3,879,207 $ 3,468,051 Liabilities and Shareholders? EquityInterest-bearing liabilities: Interest-bearing deposits $ 1,802,175 $ 1,350 0.30 % $ 1,744,557 $ 1,549 0.35 % $ 1,650,064 $ 3,766 0.92 %Federal Home Loan Bank 50,000 221 1.79 % 50,163 221 1.76 % 50,000 221 1.78 %advancesOther interest-bearing ? ? ? 1,426 4 ? 763 4 ? liabilitiesTotal interest-bearing 1,852,175 $ 1,571 0.34 % 1,796,146 $ 1,774 0.39 % 1,700,827 $ 3,991 0.94 %liabilitiesNoninterest-bearing liabilities:Noninterest-bearing deposits 1,478,183 1,482,753 1,184,776 Other liabilities 51,634 55,174 44,620 Total noninterest-bearing 1,529,817 1,537,927 1,229,396 liabilitiesShareholders? equity 549,528 545,134 537,828 Total liabilities and $ 3,931,520 $ 3,879,207 $ 3,468,051 shareholders? equityNet interest income $ 33,090 $ 32,520 $ 32,220 Net interest spread^(3) 3.51 % 3.40 % 3.62 %Net interest margin^(4) 3.68 % 3.59 % 4.05 %Net interest margin - tax 3.71 % 3.62 % 4.06 %equivalent^(5)

^ ^Annualized.(1)^ ^Includes average outstanding balances related to loans held for sale.(2)^ ^Net interest spread is the average yield on interest?earning assets minus(3) the average rate on interest?bearing liabilities.^ ^Net interest margin is equal to net interest income divided by average(4) interest?earning assets.^ ^Tax equivalent adjustments of $299,000, $287,000 and $81,000 for the(5) quarters ended March 31, 2021, December 31, 2020 and March 31, 2020, respectively, were computed using a federal income tax rate of 21%.

CBTX,INC. AND SUBSIDIARYRate/Volume Analysis (In thousands)

Three Months Ended March 31, 2021, Compared to Three Months Ended December 31, 2020 Increase (Decrease)dueto (Dollars in thousands) Rate Volume Days TotalInterest-earning assets: Total loans $ 1,667 $ (670 ) $ (718 ) $ 279 Securities 23 105 (25 ) 103 Other interest-earning assets (24 ) 37 (4 ) 9 Equity investments (21 ) ? (3 ) (24 )Total increase (decrease) in 1,645 (528 ) (750 ) 367 interest incomeInterest-bearing liabilities: Interest-bearing deposits (216 ) 51 (34 ) (199 )Federal Home Loan Bank advances 6 (1 ) (5 ) ? Other interest-bearing liabilities (4 ) ? ? (4 )Total increase (decrease) in (214 ) 50 (39 ) (203 )interest expenseIncrease (decrease) in net $ 1,859 $ (578 ) $ (711 ) $ 570 interest income

Three Months Ended March 31, 2021, Compared to Three Months Ended March 31, 2020 Increase (Decrease)dueto (Dollars in thousands) Rate Volume Days TotalInterest-earning assets: Total loans $ (3,484 ) $ 3,403 $ (371 ) $ (452 )Securities (322 ) 148 (16 ) (190 )Other interest-earning assets (1,404 ) 538 (12 ) (878 )Equity investments (50 ) 22 (2 ) (30 )Total increase (decrease) in (5,260 ) 4,111 (401 ) (1,550 )interest incomeInterest-bearing liabilities: Interest-bearing deposits (2,722 ) 348 (42 ) (2,416 )Federal Home Loan Bank advances 2 ? (2 ) ? Other interest-bearing (4 ) ? ? (4 )liabilitiesTotal increase (decrease) in (2,724 ) 348 (44 ) (2,420 )interest expenseIncrease (decrease) in net $ (2,536 ) $ 3,763 $ (357 ) $ 870 interest income

CBTX,INC. AND SUBSIDIARYYield Trend(1)

Three Months Ended 3/31/ 12/31/ 9/30/ 6/30/ 3/31/ 2021 2020 2020 2020 2020 Interest-earning assets: Total loans 4.64 % 4.42 % 4.37 % 4.54 % 5.13 %Securities 1.84 % 1.80 % 1.87 % 2.05 % 2.34 %Other interest-earning 0.15 % 0.17 % 0.18 % 0.18 % 1.35 %assetsEquity investments 3.86 % 4.41 % 4.20 % 4.54 % 5.18 %Total interest-earning 3.85 % 3.79 % 3.75 % 3.91 % 4.56 %assets Interest-bearing liabilities:Interest-bearing deposits 0.30 % 0.35 % 0.42 % 0.48 % 0.92 %Federal Home Loan Bank 1.79 % 1.76 % 1.76 % 1.36 % 1.78 %advancesOther interest-bearing ? ? ? 0.19 % ? liabilitiesTotal interest-bearing 0.34 % 0.39 % 0.46 % 0.52 % 0.94 %liabilities Net interest spread^(2) 3.51 % 3.40 % 3.29 % 3.39 % 3.62 %Net interest margin^(3) 3.68 % 3.59 % 3.52 % 3.65 % 4.05 %Net interest margin - tax 3.71 % 3.62 % 3.55 % 3.68 % 4.06 %equivalent^(4)

^ ^Annualized.(1)^ ^Net interest spread is the average yield on interest?earning assets minus(2) the average rate on interest?bearing liabilities.^ ^Net interest margin is equal to net interest income divided by average(3) interest?earning assets.^ ^Tax equivalent adjustments were computed using a federal income tax rate(4) of 21%.

CBTX,INC. AND SUBSIDIARYAverage Outstanding Balances (In thousands)

Three Months Ended 3/31/2021 12/31/2020 9/30/2020 6/30/2020 3/31/2020 Assets Interest-earning assets:Total loans^(1) $ 2,901,291 $ 2,961,622 $ 2,945,320 $ 2,908,204 $ 2,634,507 Securities 259,341 236,233 236,015 240,343 233,917 Otherinterest-earning 475,279 388,936 383,626 378,405 315,099 assetsEquity investments 15,353 15,346 15,334 15,147 13,661 Totalinterest-earning 3,651,264 3,602,137 3,580,295 3,542,099 3,197,184 assetsAllowance for credit (41,078 ) (44,233 ) (40,135 ) (31,443 ) (25,831 )losses for loansNoninterest-earning 321,334 321,303 326,590 305,821 296,698 assetsTotal assets $ 3,931,520 $ 3,879,207 $ 3,866,750 $ 3,816,477 $ 3,468,051 Liabilities and Shareholders? EquityInterest-bearing liabilities:Interest-bearing $ 1,802,175 $ 1,744,557 $ 1,730,812 $ 1,687,991 $ 1,650,064 depositsFederal Home Loan 50,000 50,163 50,000 70,769 50,000 Bank advancesOtherinterest-bearing ? 1,426 2,230 2,101 763 liabilitiesTotalinterest-bearing 1,852,175 1,796,146 1,783,042 1,760,861 1,700,827 liabilitiesNoninterest-bearing liabilities:Noninterest-bearing 1,478,183 1,482,753 1,484,557 1,462,271 1,184,776 depositsOther liabilities 51,634 55,174 55,386 49,958 44,620 Totalnoninterest-bearing 1,529,817 1,537,927 1,539,943 1,512,229 1,229,396 liabilitiesShareholders? equity 549,528 545,134 543,765 543,387 537,828 Total liabilities and $ 3,931,520 $ 3,879,207 $ 3,866,750 $ 3,816,477 $ 3,468,051 shareholders? equity

^(1) ^Includes average outstanding balances of loans held for sale.

CBTX,INC. AND SUBSIDIARYLoans and Deposits Period End Balances (In thousands, except percentages)

3/31/2021 12/31/2020 9/30/2020 6/30/2020 3/31/2020 Amount % Amount % Amount % Amount % Amount % Loan Portfolio: Commercial and $ 756,707 26.1 % $ 742,957 25.3 % $ 832,686 28.0 % $ 837,667 28.4 % $ 542,650 20.3 %industrialReal estate: Commercial real 1,072,263 36.9 % 1,041,998 35.5 % 949,933 31.9 % 908,027 30.8 % 904,395 33.8 %estateConstruction and 464,091 16.0 % 522,705 17.8 % 506,216 17.0 % 552,879 18.8 % 558,343 20.8 %development1-4 family 224,880 7.7 % 239,872 8.2 % 253,868 8.5 % 272,253 9.2 % 276,142 10.3 %residentialMulti-family 271,719 9.4 % 258,346 8.8 % 298,733 10.0 % 255,273 8.7 % 267,152 10.0 %residentialConsumer 32,767 1.1 % 33,884 1.1 % 35,637 1.2 % 36,338 1.2 % 38,133 1.4 %Agriculture 6,974 0.2 % 8,670 0.3 % 9,753 0.3 % 7,795 0.3 % 7,520 0.3 %Other 74,387 2.6 % 88,238 3.0 % 91,501 3.1 % 77,535 2.6 % 84,076 3.1 %Gross loans 2,903,788 100.0 % 2,936,670 100.0 % 2,978,327 100.0 % 2,947,767 100.0 % 2,678,411 100.0 %Less allowance for (40,874 ) (40,637 ) (44,069 ) (39,678 ) (31,194 ) credit lossesLess deferred feesand unearned (11,151 ) (9,880 ) (12,038 ) (12,879 ) (5,942 ) discountLess loans held for (1,005 ) (2,673 ) (1,763 ) ? (882 ) saleLoans, net $ 2,850,758 $ 2,883,480 $ 2,920,457 $ 2,895,210 $ 2,640,393 Deposits: Interest-bearing $ 368,124 10.9 % $ 380,175 11.5 % $ 346,406 10.9 % $ 366,281 11.2 % $ 359,943 12.9 %demand accountsMoney market 995,945 29.4 % 1,039,617 31.5 % 916,668 28.9 % 878,006 27.0 % 760,036 27.2 %accountsSavings accounts 112,467 3.3 % 108,167 3.3 % 103,062 3.3 % 98,485 3.0 % 90,227 3.2 %Certificates andother time 145,762 4.3 % 152,592 4.6 % 171,854 5.4 % 200,505 6.2 % 212,341 7.6 %deposits, $100,000or greaterCertificates andother time 141,041 4.2 % 144,818 4.4 % 171,691 5.4 % 197,178 6.1 % 174,145 6.3 %deposits, lessthan$100,000Totalinterest-bearing 1,763,339 52.1 % 1,825,369 55.3 % 1,709,681 53.9 % 1,740,455 53.5 % 1,596,692 57.2 %depositsNoninterest-bearing 1,621,408 47.9 % 1,476,425 44.7 % 1,460,983 46.1 % 1,513,748 46.5 % 1,195,541 42.8 %depositsTotal deposits $ 3,384,747 100.0 % $ 3,301,794 100.0 % $ 3,170,664 100.0 % $ 3,254,203 100.0 % $ 2,792,233 100.0 %

CBTX,INC. AND SUBSIDIARYCredit Quality(In thousands, except percentages)

3/31/2021 12/31/2020 9/30/2020 6/30/2020 3/31/2020NonperformingAssets (at period end):Nonaccrual loans:Commercialand $ 12,230 $ 12,588 $ 6,699 $ 5,519 $ 449 industrialReal estate: Commercial 10,664 10,665 4,811 4,811 67 real estateConstructionand 236 238 241 506 519 development1-4 family 378 526 325 332 413 residentialMulti-family ? ? ? ? ? residentialConsumer ? ? ? ? ? Agriculture ? ? ? ? ? Other ? ? 3,500 ? ? Nonaccrual 23,508 24,017 15,576 11,168 1,448 loansAccruingloans 90 or ? ? ? ? ? more dayspast dueTotalnonperforming 23,508 24,017 15,576 11,168 1,448 loansForeclosed 106 ? ? ? ? assetsTotalnonperforming $ 23,614 $ 24,017 $ 15,576 $ 11,168 $ 1,448 assets Allowance forCredit Losses for Loans (atperiod end):Commercialand $ 13,812 $ 13,035 $ 13,347 $ 12,108 $ 9,535 industrialReal estate: Commercial 14,280 13,798 12,745 12,424 9,576 real estateConstructionand 5,445 6,089 6,334 7,050 5,795 development1-4 family 2,458 2,578 2,871 3,173 2,430 residentialMulti-family 2,714 2,513 3,117 2,880 2,413 residentialConsumer 434 440 507 529 477 Agriculture 107 137 164 134 129 Other 1,624 2,047 4,984 1,380 839 Totalallowance for $ 40,874 $ 40,637 $ 44,069 $ 39,678 $ 31,194 credit lossesfor loans CreditQuality Ratios (atperiod end):Nonperformingassets to 0.59 % 0.61 % 0.41 % 0.29 % 0.04 %total assetsNonperformingloans toloans 0.81 % 0.82 % 0.53 % 0.38 % 0.05 %excludingloans heldfor saleAllowance forcredit lossesfor loans to 173.87 % 169.20 % 282.93 % 355.28 % 2,154.28 %nonperformingloansAllowance forcredit lossesfor loans toloans 1.41 % 1.39 % 1.49 % 1.35 % 1.17 %excludingloans heldfor sale

CBTX,INC. AND SUBSIDIARYAllowance for Credit Losses for Loans(In thousands, except percentages)

Three Months Ended 3/31/2021 12/31/2020 9/30/2020 6/30/2020 3/31/2020 Beginning $ 40,637 $ 44,069 $ 39,678 $ 31,194 $ 25,280 balance Adoption of ? ? ? ? 874 CECL Provision 286 229 4,569 8,537 4,739 Net(charge-offs) recoveries:Commercialand (95 ) (305 ) (31 ) 18 398 industrialReal estate: Commercial ? 143 (135 ) (24 ) ? real estateConstructionand ? ? ? ? ? development1-4 family ? ? (5 ) (66 ) 1 residentialMulti-family ? ? ? ? ? residentialConsumer 4 1 (7 ) 7 (99 )Agriculture 42 ? ? 12 ? Other ? (3,500 ) ? ? 1 Total net(charge-offs) (49 ) (3,661 ) (178 ) (53 ) 301 recoveriesEnding $ 40,874 $ 40,637 $ 44,069 $ 39,678 $ 31,194 balanceNetcharge-offs )(recoveries) 0.01 % 0.49 % 0.02 % 0.01 % (0.05 %to averageloans^(1)

^(1) ^Annualized.

CBTX,INC. AND SUBSIDIARYNonGAAP to GAAP Reconciliation (In thousands, except per share data and percentages)

Our accounting and reporting policies conform to GAAP and the prevailing practices in the banking industry. However, we also evaluate our performance based on certain additional nonGAAP financial measures. We classify a financial measure as being a nonGAAP financial measure if that financial measure excludes or includes amounts, or is subject to adjustments that have the effect of excluding or including amounts, that are not included or excluded in the most directly comparable measure calculated and presented in accordance with GAAP as in effect from time to time in the United States in our statements of income, balance sheets or statements of cash flows. NonGAAP financial measures do not include operating, other statistical measures or ratios calculated using exclusively financial measures calculated in accordance with GAAP. NonGAAP financial measures should not be considered in isolation or as a substitute for the most directly comparable or other financial measures calculated in accordance with GAAP. Moreover, the way we calculate the nonGAAP financial measures may differ from that of other companies reporting measures with similar names.

We calculatetangible equity as total shareholders equity, less goodwill and other intangible assets, net of accumulated amortization, andtangible book value per share as tangible equity divided by shares of common stock outstanding at the end of the relevant period. The most directly comparable GAAP financial measure for tangible book value per share is book value per share.

We calculate tangible assets as total assets less goodwill and other intangible assets, net of accumulated amortization. The most directly comparable GAAP financial measure for tangible equity to tangible assets is total shareholders equity to total assets.

We believe that tangible book value per share and tangible equity to tangible assets are measures that are important to many investors in the marketplace who are interested in book value per share and total shareholders equity to total assets, exclusive of change in intangible assets.

The following table reconciles, as of the dates set forth below, total shareholders equity to tangible equity, total assets to tangible assets and presents book value per share, tangible book value per share, tangible equity to tangible assets and total shareholders equity to total assets:

3/31/2021 12/31/2020 9/30/2020 6/30/2020 3/31/2020Tangible EquityTotalshareholders? $ 545,349 $ 546,451 $ 540,921 $ 537,356 $ 536,874 equityAdjustments: Goodwill 80,950 80,950 80,950 80,950 80,950 Other 3,991 4,171 4,303 4,496 4,700 intangiblesTangible $ 460,408 $ 461,330 $ 455,668 $ 451,910 $ 451,224 equityTangible AssetsTotal assets $ 4,028,639 $ 3,949,217 $ 3,814,672 $ 3,901,725 $ 3,425,650 Adjustments: Goodwill 80,950 80,950 80,950 80,950 80,950 Other 3,991 4,171 4,303 4,496 4,700 intangiblesTangible $ 3,943,698 $ 3,864,096 $ 3,729,419 $ 3,816,279 $ 3,340,000 assets Common shares 24,442 24,613 24,713 24,755 24,746 outstanding Book value $ 22.31 $ 22.20 $ 21.89 $ 21.71 $ 21.70 per shareTangible bookvalue per $ 18.84 $ 18.74 $ 18.44 $ 18.26 $ 18.23 shareTotalshareholders? 13.54 % 13.84 % 14.18 % 13.77 % 15.67 %equity tototal assetsTangibleequity to 11.67 % 11.94 % 12.22 % 11.84 % 13.51 %tangibleassets

Investor Relations:

Justin M. Long281.325.5013investors@CBoTX.com

Media Contact:

Ashley Warren713.210.7622 awarren@CBoTX.com