About Independent Bank Group

Independent Bank Group, Inc. operates as the bank holding company for Independent Bank (doing business as Independent Financial) that provides a wide range of relationship-driven commercial banking products and services tailored to meet the needs of businesses, professionals, and individuals. The company operates branches and offices in the Dallas/North Texas area, including McKinney, Dallas, Fort Worth, and Sherman/Denison, the Austin/Central Texas area, including Austin and Waco, the Houston Texas metropolitan area and along the Colorado Front Range area, including Denver, Colorado Springs and Fort Collins. The company seeks to provide personal attention and professional assistance to its customer base, which consists principally of small to medium sized businesses, professionals and individuals. Business Strategy The company focuses on continued organic growth through its existing footprint and business lines. The company utilizes a community-focused, relationship-driven customer strategy to increase loans and deposits through its existing locations. The company plans to continue to take advantage of opportunities to acquire or strategically partner with other banking franchises both within and outside the company’s current footprint. Community Banking Services Through the bank, the company strives to provide customers with innovative financial products and services, local decision making and a level of service and responsiveness that is second to none. The company’s innovative and independent spirit is balanced by adherence to fundamental banking principles that have enabled the company to remain strong, sound and financially secure even during challenging economic times. The company is also steeped in a tradition of civic pride as evidenced by the investment of its time, energies and financial resources in many local community development initiatives and organizations to improve and benefit the company’s communities. Lending Operations Through the bank, the company offers a broad range of commercial and retail lending products to businesses, professionals and individuals. Commercial lending products include, but are not limited to, commercial real estate loans, interim construction loans, commercial loans (such as Small Business Administration (SBA) guaranteed loans, business term loans, lines of credit and energy related loans) to a diversified mix of small and midsized businesses, and loans to professionals, including medical practices. Retail lending products include, but are not limited to, residential first and second mortgage loans and consumer installment loans, such as loans to purchase cars, boats and other recreational vehicles. The company’s strategy is to maintain a broadly diversified loan portfolio by type and location. The company’s loan portfolio consists of real estate loans, commercial and industrial loans, residential mortgage loans, residential construction loans, agricultural loans, consumer loans, and energy loans, among others. Real estate secured loans are spread among a variety of types of borrowers, including owner-occupied offices for small businesses, medical practices and offices, retail operations and multi-family properties. The company’s loans are diversified geographically throughout its footprint. Commercial Loans The company provides a mix of variable and fixed rate commercial loans. The loans are typically made to small-and medium-sized manufacturing, wholesale, retail, energy related service businesses and medical practices for working capital needs and business expansions. Commercial loans generally include lines of credit and loans with maturities of five years or less. The loans are generally made with operating cash flows as the primary source of repayment, but may also include collateralization by inventory, accounts receivable, equipment and/or personal guarantees. Additionally, a portion of the commercial loan portfolio includes participations purchased from other financial institutions in larger transactions considered Shared National Credits (SNC). Almost all purchased SNCs are in the Commercial loan portfolio with the largest single industry concentration in energy. Loans in the commercial portfolio are monitored for credit quality at least annually, while energy loans are subject to review semi-annually and other loans in the specialized lending portfolio are reviewed quarterly. Mortgage Warehouse Purchase Loans The company offers mortgage warehouse purchase loans. Commercial Real Estate Loans (CRE) The commercial real estate loan portfolio has historically been the company's largest category of loans, representing 56.3% of the total portfolio as of December 31, 2023. The company expects that commercial real estate loans will continue to be a significant portion of its total loan portfolio and an area of emphasis in its lending operations. Despite the company's concentration in commercial real estate, the properties securing this portfolio are diversified in terms of type and geographic location. Commercial Construction, Land and Land Development Loans The company’s commercial construction, land and land development loans include loans to fund commercial construction, land acquisition and real estate development construction. The company continues to make commercial construction loans, land acquisition and land development loans on a selective basis. Residential Real Estate Loans The company’s residential real estate loans, excluding mortgage loans held for sale, are primarily made with respect to and secured by single-family homes, which are both owner-occupied and investor owned and include a limited amount of home equity loans, with a relatively small average loan balance spread across many individual borrowers. The company offers a variety of mortgage loan portfolio products which generally are amortized over five to thirty years. Loans collateralized by 1-4 family residential real estate generally have been originated in amounts of no more than 80% of appraised value. The company requires mortgage title insurance and hazard insurance. The company incurs interest rate risk, as well as the risks associated with nonpayment on such loans. Single-Family Interim Construction Loans The company makes single-family interim construction loans to home builders and individuals to fund the construction of single-family residences with the understanding that such loans will be repaid from the proceeds of the sale of the homes by builders or, in the case of individuals building their own homes, with the proceeds of a permanent mortgage loan. Such loans are secured by the real property being built and are made based on the company’s assessment of the value of the property on an as-completed basis. The company expects to continue to make single-family interim construction loans so long as demand for such loans continues and the market for single-family housing and the values of such properties remain stable or continue to improve in its markets. Other Categories of Loans Other categories of loans in the company’s loan portfolio include agricultural loans made to farmers and ranchers relating to their operations and consumer loans made to individuals for personal purposes, including automobile purchase loans and personal loans. Deposits Through the bank, the company provides a full range of deposit products and services, including a variety of checking and savings accounts, debit cards, online banking, including online account opening, mobile banking, eStatements and bank-by-mail and direct deposit services. Deposits are the company’s principal source of funds for use in lending and other general banking purposes. The company also offers business accounts and management services, including analyzed business checking, business savings, and treasury management services. The company solicits deposits through its relationship-driven team of dedicated and accessible bankers and through community focused marketing. The company also utilizes an experienced Treasury Management team to solicit and manage large deposit relationships. Other Services In connection with its relationship driven approach to its customers, the company, through the bank, offers residential mortgages through the mortgage division. The company originates residential mortgages which are typically sold into the secondary market shortly after closing. The company also supports residential mortgage operations through a mortgage warehouse program. The company provides wealth management services to its customers through Private Capital Management, LLC, a registered investment advisory firm, which is a wholly owned subsidiary of the bank. The company focuses on a retail banking strategy designed to enhance the consumer experience with the company. Through this strategy, the company utilizes an intentional and focused approach to understand and meet the multifaceted financial needs of each individual customer within the company’s financial centers. Investment Portfolio As of December 31, 2023, the company’s investment portfolio included U.S. treasuries; Government agency securities; obligations of state and municipal subdivisions; corporate bonds; mortgage-backed securities guaranteed by FHLMC, FNMA and GNMA; and other securities. Supervision and Regulation As a bank holding company, the company is subject to regulation under the Bank Holding Company Act of 1956, or the BHC Act, and to supervision, examination and enforcement by the Board of Governors of the Federal Reserve System (Federal Reserve). The common stock of the company is registered with the Securities and Exchange Commission (SEC) under the Securities Exchange Act of 1934, as amended (the ‘Exchange Act’). Therefore, the company is subject to the reporting, information disclosure, proxy solicitation, insider trading limits and other requirements imposed on public companies by the SEC under the Exchange Act. The SEC and Nasdaq have adopted regulations under the Sarbanes-Oxley Act of 2002 and the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd Frank Act) that apply to the company as a Nasdaq-traded, public company, which seek to improve corporate governance, provide enhanced penalties for financial reporting improprieties and improve the reliability of disclosures in SEC filings. The bank is a Texas-chartered banking association, the deposits of which are insured by the deposit insurance fund of the Federal Deposit Insurance Corporation (FDIC). The bank is not a member of the Federal Reserve System, therefore, the bank is subject to supervision and regulation by the FDIC, the Texas Department of Banking (TDB), and the Consumer Financial Protection Bureau (CFPB). Transactions between the bank and its nonbanking subsidiaries and/or affiliates, including the company, are subject to Section 23A of the Federal Reserve Act. Affiliate transactions are also subject to Section 23B of the Federal Reserve Act, which generally requires that certain transactions between the bank and its affiliates be on terms substantially the same, or at least as favorable to the bank, as those prevailing at the time for comparable transactions with or involving other nonaffiliated persons. The bank is subject to continuous regulation, supervision and examination by the FDIC and the TDB concerning all areas of operation of the bank. Areas monitored by the FDIC and the TDB, include, but are not limited to, lending practices, corporate governance, investments, borrowings, payment of dividends, training of employees, reserve methodology, BSA/AML compliance, management of risk related to interest rate, liquidity, capital and operations, overall enterprise risk management, internal audit program, financial accounting practices, security procedures, information technology and other related matters. The bank is subject to supervision and examination by the CFPB. The CFPB maintains authority over the bank with respect to substantially all federal statutes and regulations protecting the interests of consumers of financial services, including but not limited to the Equal Credit Opportunity Act, the Fair Credit Reporting Act, the Truth in Lending Act, the Home Mortgage Disclosure Act, the Real Estate Settlement Procedures Act, the Fair Debt Collection Practices Act, the Truth in Savings Act, the Right to Financial Privacy Act, and the Electronic Funds Transfer Act and their respective related regulations. The bank is also subject to other federal and state consumer protection laws that, among other things, prohibit unfair, deceptive and abusive, corrupt or fraudulent business practices, untrue or misleading advertising and unfair competition. Substantially all of the deposits of the bank are insured up to applicable limits by the deposit insurance fund of the FDIC, and the bank must pay annual deposit insurance assessments to the FDIC for such deposit insurance protection. History Independent Bank Group, Inc. was founded in 2002. The company was incorporated in 2002.