First Financial Bankshares
Annual Report 2018

Plain-text annual report

2 0 1 8 A N N U A L R E P O R T PROTECTING OUR CUSTOMERS First Financial’s Fraud Busters Program is Stopping Fraud in its Tracks All across Texas, First Financial associates have successfully protected their customers from a variety of fraudulent schemes and activities. It was just another normal day at First Financial Bank in Cleburne when a customer entered with some exciting news. The customer had received a letter informing her that she had won a large sweepstakes, worth nearly $1 million dollars. All she had to do to collect her windfall was cash an enclosed check for $8,998.75, and then send back $7,798.00 as a prize processing fee. Once this was paid, she would receive her big prize. First Financial Retail Banker Pam Crowell immediately sensed something was wrong. Noticing a phone number on the sweepstakes letter, she called to confirm the prize. After just a few questions, the person who had answered the call abruptly hung up and would not answer subsequent calls. As suspected, it was a fraud attempt on an innocent First Financial customer. And, it was yet another successful win for First Financial Bank’s Fraud Busters Program. Fraud Busters :: Page 2 A Word from First Financial President & CEO Scott Dueser: “Our Fraud Busters initiative has proven to be a great success. It is because of our First Financial associates, who’ve embraced it wholeheartedly. Because of their diligent efforts, they have protected both our customers and our bank from financial exploitation and painful monetary loss. I encourage all of us to remain vigilant and aware of these unscrupulous activities. Together, we can maintain the Fraud Busters Program’s impressive record of success.” First Financial’s Fraud Busters have stopped thousands of scams and saved millions of dollars. Since its implementation in December of 2014, First Financial Fraud Busters have stopped more than 1,500 fraud attempts and saved more than $7 million for both customers and the Bank. And, just like the attempted fraud case in Cleburne described on the prior page, there have been more than 130 other Fraud Busters stories reported. In 2016, the American Banking Association estimated that frauds and scams cost the banking industry $2.2 billion on deposit accounts alone. When debit card, ATMs and wire fraud are included, the number grows dramatically. At First Financial, educating our associates is the first step of our Fraud Busters Program. This allows them to both quickly identify fraudulent activity and help customers spot it too. Plus, seminars and social media posts for the community to read and share help spread the word about scams that can evolve quickly. Best of all? When a fraud or scam is “busted,” the Bank employee responsible for identifying it receives a Fraud Busters Award. First Financial’s Fraud Busters Program is much more robust than the common practice of just sending internal bank emails regarding fraud. It’s a highly organized program, utilizing specific templates, timelines and reward systems. It’s also unique because it is honored by executive management, distributed to every employee in the Company, celebrated regardless of the monetary value saved and used to educate the community. We also host seminars to educate organizations such as AARP, civic clubs, church groups, retirement centers, businesses, local police and law offices. The best weapon we have against fraud is knowledge. Just knowing about these types of frauds and scams is an important step in protecting yourself from becoming a victim. Rest assured that First Financial Bank is committed to continuing our practice of standing guard against frauds and scams across our network of banks in Texas. Whether in Abilene or Orange, Hereford or Burleson, you can be certain the Fraud Busters Program is on the lookout for dishonest behavior aimed at our customers. It’s just another way First Financial lives up to its slogan of “You First.” When it sounds too good to be true, it usually isn’t true. Still, it can be easy to fall prey to certain carefully orchestrated scam approaches. Here are some popular fraud schemes and scams: The Overpayment Scam: The scam artist sends you a counterfeit check. They instruct you to deposit it in your bank account and wire a portion of the money back to them. Since the check is a fake, you’ll have to pay your bank the amount of the check, plus you’ll lose the money you wired. Unsolicited Check Fraud: A scammer sends you a check for no reason. If you cash it, you may be authorizing the purchase of items or signing up for a loan you never requested. Automatic Withdrawal Fraud: A company sets up an automatic debit from your bank account, as part of a bogus free trial or to collect lottery winnings. Phishing: You receive an email, call or text that asks you to verify your bank account or debit card number. Dollar Amounts Saved Since 2014 by Fraud Busters by Region Region Abilene Cleburne Conroe Fort Worth Hereford Kingwood Orange San Angelo Southlake Stephenville Weatherford Grand Total Amount $4,426,145.69 $27,764.62 $1,095,610.56 $463,379.37 $46,018.94 $62,090.72 $56,549.07 $387,377.06 $812,504.33 $96,561.42 $59,185.26 $7,533,187.04 Fraud Busters :: Page 3 A LETTER TO OUR SHAREHOLDERS. First Financial Bankshares provides As a result of our program’s success, we have received a $3.98 billion from $3.50 billion. Deposits increased 3.6 percent to a drive-in, ATM and the latest in banking technology, so it is a huge a myriad of products and services to Community Commitment Award from the American Bankers $6.18 billion from $5.96 billion. However, we are not pleased with upgrade for our customers. We are pleased that the facility has been meet our customers’ needs, wants Association Foundation in 2015, and a Leaders in Financial our organic loan and deposit growth and are working hard to grow delivering good results, which is a testament to our employees there and dreams. One of those services Education Award from the Texas Bankers Association in 2016. both through increased marketing efforts. Shareholders’ equity at and the service they provide to our customers. is our Fraud Busters program, Although we appreciate these recognitions, our true passion is year-end was $1.05 billion, up 14.1 percent from $922.8 million at an initiative to combat financial protecting you—our customers and stockholders. year-end 2017. In January 2019, we opened a new branch at 3563 Riley Fuzzell Road in Spring, Texas. The Spring branch is located on Grand We put You First. FINANCIAL RESULTS Our First Financial Trust & Asset Management subsidiary had Parkway at Birnham Woods, which, as our property experts say, another outstanding year fueled by a large growth in trust assets and is one of the best locations in our First Financial footprint. With the a strong increase in oil and gas leasing activity by our Oil and Gas opening of this beautiful new building, First Financial now has 73 Management Division. Total trust assets under management at year- locations serving customers across the state. The Spring branch Last year marked our 32nd consecutive year of increased end reached a book value of $4.29 billion, an 11.1 percent increase expands our market north of Houston. exploitation. We created it several years ago, primarily to protect our elder customers. With fraud now an epidemic, we have been giving this program even greater attention. It doesn’t matter what age you are, whether you are rich or poor, or operate a large or small business—you are a candidate to become a fraud victim. We believe the best way to protect our customers, as well as the general public, is to educate them about the different scams and methods of fraud that may be targeting them. We also protect our customers by making sure our employees and officers are well trained to detect and stop fraud as it is happening. Our partnerships with local law enforcement agencies in the communities we serve are a valuable tool that not only help stop fraud as it’s being committed, but also help take the fraudsters off the streets. We applaud our local law officers because they respond immediately when we call to alert them that we believe a fraud is in progress. I also commend my associates who do an outstanding job of detecting fraud, contacting law enforcement and detaining the fraudster, so that earnings. Net income for 2018 grew $30.3 million to $150.6 from $3.87 billion at the end of 2017. The market value of the assets million from $120.4 million in 2017. This large 25.1 percent totaled $5.60 billion, up 9.1 percent from $5.13 billion at year-end increase in earnings was fueled by the decrease in the federal 2017. Total trust fee income for 2018 increased 18.9 percent to corporate income tax rate to 21 percent from 35 percent in late $28.2 million from $23.7 million in 2017, and net earnings after tax 2017, and by our acquisition of Commercial Bancshares on increased 57.7 percent to $13.5 million from $8.6 million. January 1, 2018. Basic earnings per share in 2018 rose to $2.23 from $1.82 in the previous year. Although the Federal Reserve raised interest rates by 25 basis points four times in 2018, our net interest margin moved down slightly to 3.96 percent from STRATEGIC ACQUISITION On January 1, 2018, we completed the acquisition of Kingwood- 4.01 percent in 2017. (The net interest margin is a key profitability based Commercial Bancshares, Inc. and its wholly-owned metric that expresses net interest income on a tax-equivalent basis as a percentage of average interest-earning assets.) We subsidiary, Commercial State Bank. We issued 1,289,371 shares of First Financial Bankshares common stock with a value of worked diligently to increase our loan rates to reflect the interest $59.4 million to the shareholders of Commercial Bancshares, rate increases made by the Federal Reserve, but competition Inc. In addition, prior to closing, Commercial Bancshares, Inc. continued to be the largest impediment we faced. Nevertheless, paid a special dividend to its shareholders totaling $22.1 million our net interest margin was still a very respectable result and placed us in the 74th percentile of our peer group of banks. As most of you probably remember, we sold our Orange facility to the City of Orange in 2017 and started construction of a strategically placed building one block away. Because of weather conditions, including Hurricane Harvey, completion of this building has been delayed several months, but we plan to move into the building in March 2019. This new location will provide state-of-the-art banking and better access for our mortgage and banking customers. MANAGEMENT CHANGES In March 2018, Will Christoferson was named Vice President of Advertising and Marketing. He is an Abilene native and has had more than nine years of banking experience as a Commercial Sales and Marketing Officer with a major banking institution. Michele Stevens, our Executive Vice President of Advertising and Marketing, will retire in May 2019. Michele has been with the Company for 22 years and has been the driving force behind our marketing initiatives during all that time. In April 2018, Austin Elsner was promoted to Chairman, President and CEO of the Cleburne Region upon the retirement of Tom O’Neil, who had worked for the Bank for more than 25 years. Austin has been with the Bank since November 2017 and is a Cleburne native. He has had more than 18 years of banking experience as a Business Relationship Manager, Assistant Branch Manager and Business Banking Area Manager. In August 2018, Kirby Cason was named President of the Huntsville market to replace Robert Pate, who retired from the Bank at the end of the year. Robert had served our company for 34 years and had been President of the Huntsville market for seven years. Kirby, who is a native of Huntsville, graduated from Sam Houston State University and has been in the banking industry for 13 years. in accordance with the terms of our merger agreement. As of December 31, 2017, Commercial State Bank had total assets of $390.2 million, total loans of $271.5 million and total deposits of $345.9 million. The acquisition of Commercial State Bank expanded our growing Texas footprint into the cities of Kingwood, Fulshear, El Campo and Palacios, all located around the Houston market. The operations of Commercial State Bank in those four cities have been integrated into the First Financial family as the Kingwood Region. We are very pleased with the new region’s results for its first year as part of First Financial. It produced earnings of $6.1 million and a return on average assets of 1.63 percent. As of December 31, 2018, the Kingwood Region had total assets of $365.0 million, total loans of $318.7 million and total deposits of $300.8 million. It serves a high-growth area and has good management and a very qualified and experienced lending staff. We have added consumer lending and trust services to the Region’s array of products and services. We believe the Region has excellent potential to grow while continuing the perpetrator can be arrested. Last year alone, we prevented The provision for loan losses decreased 13.2 percent to $5.7 more than $2.2 million of fraud, compared with $1.8 million the million from $6.5 million in 2017. This decrease was due primarily year before. And over the last four years, we have stopped $7.5 to fewer charge-offs than in 2017. Nonperforming assets as a million of fraud from being committed. The largest frauds we see today are aimed at businesses with large balances, checks, automated clearing house transactions and wire transfers. If you or your business associates have not attended our course on detecting these types of frauds, please contact us and we will connect you with our Treasury Management Department personnel, so they may personally percentage of loans and foreclosed assets totaled 0.75 percent at December 31, 2018, compared to 0.57 percent at December 31, 2017. Classified loans totaled $126.3 million at December 31, 2018, compared to $117.2 million a year earlier. Noninterest income grew 11.8 percent to $101.8 million from $91.0 million, while noninterest expense rose 9.6 percent to $190.7 million from $174.0 million. educate you and your employees on how to protect your We again outperformed our peer group of banks on several key business from fraud with products and services that we can financial metrics. Our return on average assets was 1.98 percent provide. We are very proud to say that since initiating our Fraud Busters program, we have become one of the leading banks in the country in fraud prevention and have been invited to speak at the White House Conference on Aging, the AARP National Convention, the Texas Senate Committee on Business and Commerce, the Texas House Investments and Financial Services Committee and the Federal Reserve Bank of Philadelphia. compared with 1.23 percent for our peers. Return on average equity was 15.37 percent versus our peers’ 11.02 percent. Our efficiency ratio, which expresses expenses as a proportion of tax-equivalent revenues, was again solid last year at 49.72 percent, as opposed to our peers’ average of 60.36 percent. Our balance sheet showed good growth last year, primarily because of the Commercial Bancshares acquisition. Consolidated assets expanded 6.6 percent to $7.73 billion from $7.25 billion at the end of 2017. Loans grew 13.6 percent to to cut costs and help improve our efficiency ratio. In September 2018, Andrea Smiddy-Schlagel was appointed REAL ESTATE ACTIVITIES Executive Vice President of Treasury Management. Andrea has had more than 30 years of experience in the financial services industry and is an Accredited Automated Clearing House Professional and a In December 2018, we moved into a new bank facility in New Certified Treasury Professional. Andrea’s experience and expertise Waverly. Previously, this branch had been in a leased retail office have already made a big difference in this important line of business, space without a drive-in and ATM. Our beautiful new location has A Letter To Our Shareholders :: Page 4 A Letter To Our Shareholders :: Page 5 which provides our commercial customers with the latest in Bank Board of Directors and has continued as a Kingwood products, services and technology. Regional Director following our purchase of Commercial State In December 2018, John Ruzicka was named Executive Vice Bank on January 1, 2018. He is also the Founding Member, President and Chief Information Officer of the Company, as Director and Co-Owner of Frisco Professional Building well as Chairman, President and CEO of First Technology Investors, Ltd. and Fast Fusion, LLC, along with being Services, Inc., our technology subsidiary. John has more than Managing Director of 3MCB Investments, LLC. 21 years of experience in the banking technology business. His knowledge, experience and expertise will be instrumental in expanding the information technology and strategic capabilities of our company. At the end of 2018, Justin Hooper added the titles of Chairman and CEO to his President’s position upon Jay Gibbs’s retirement as Chairman and CEO of the Weatherford Region. Jay had been with the Bank for 16 years and had led that region as Chairman, CEO and President for the past six years. Also at the end of the year, June Wideman, my assistant, retired after a 35-year tenure with the Company. June exemplified Customer Service First, and we will miss her mentorship and expertise. We thank Tom O’Neil, Robert Pate, Jay Gibbs, June Wideman and Michele Stevens for their long and valued service to our company, and we congratulate them on their well-deserved retirements. NEW DIRECTORS LOOKING AHEAD The Texas economy continues to be strong. In each of the last two years, it has created more than 300,000 new jobs, surpassing the record of every other state including California, which has a larger population. Unemployment rates continue to stay low, at around four percent, even though we have had fluctuations in oil and gas prices and continued increases in interest rates. We have identified many areas where we can improve our bottom line, such as growing loans and deposits, enhancing noninterest income and decreasing expenses, while taking advantage of our state’s continued strong economy. As in the past, we are proceeding strategically, searching diligently to acquire, at the right price, well-managed banks that fit our culture and will bring long term value to our company. With net income surpassing the $150 million mark, the Company enjoyed its best year ever in 2018. This type of We are pleased to announce that Mike Denny, President of performance does not just happen. It results directly from Batjer & Associates, Inc. Mechanical Contractors, and Robert the hard work and dedication of our boards, officers and C. Nickles, Jr., Founder and Executive Chairman of Alegacy employees. I congratulate and thank them for a job well done. Group, LLC, have accepted nominations for election as Directors of the Company at our Annual Shareholders’ Meeting in April 2019. Our customers, stockholders and employees are our most valuable assets, and we would not be where we are today without you. Thank you for your loyalty and support. F. Scott Dueser Chairman, President and CEO Mike Denny is an Abilene native who graduated from The University of Texas at Austin with a Bachelor of Business Administration degree in Finance. After returning to Abilene 42 years ago, he was employed by Batjer & Associates and moved up to become its Owner and President. Under his leadership, Batjer grew to be the largest mechanical contracting company in this area of Texas. He is also Vice President and Partner of Batjer Services, LLC. He has served on the First Financial Bank, Abilene Region Board for 14 years, and has served on the Abilene Board’s Loan Committee. Bob Nickles founded the Alegacy Group, LLC in 2013, and within five years grew the company to be the second largest gas compressor packager in the world. He is a graduate of Oklahoma State University and, over the last 28 years, has worked for or owned numerous manufacturing and engineering companies. In 2010, he was elected to the Commercial State Amarillo Abilene Dallas Fort Worth Odessa San Angelo Waco Huntsville Austin Conroe Orange San Antonio Houston FIRST FINANCIAL BANK AND TRUST LOCATIONS Abilene* ............. 325.627.7000 Acton ................. 817.573.6900 Albany ................ 325.627.7953 Aledo ................. 817.341.5200 Alvarado ........... 817.774.5150 Beaumont* ....... 409.600.6456 Boyd .................. 940.683.8760 Bridgeport ........ 940.683.8700 Brock ................. 817.596.0307 Burleson ............ 817.774.5175 Cisco ................. 254.629.6111 Cleburne ........... 817.774.5100 Clyde ................. 325.627.7910 Conroe ............... 936.760.1888 Cut and Shoot.... 936.788.2121 Decatur ............. 940.683.8780 Eastland ............ 254.629.6188 El Campo .......... 979.543.6441 Fort Worth* ........ 817.410.4979 Glen Rose ......... 254.897.4808 Granbury .......... 817.573.6900 Grapevine ......... 817.722.8980 Hereford ............ 806.363.8200 Houston* ............ 281.318.4625 Huntsville .......... 936.295.2224 Katy-Fulshear .... 281.346.0221 Keller .................. 817.329.8625 Kingwood ......... 281.318.4600 Magnolia............ 936.273.4700 Mauriceville ....... 409.745.3755 Merkel ................ 325.928.1111 Midlothian ........ 972.723.7100 Mineral Wells ..... 940.327.5400 Montgomery ..... 936.597.5997 Moran ............... 325.627.7953 Newton .............. 409.224.7506 New Waverly ..... 936.344.2224 Odessa* ............. 432.367.8910 Orange................ 409.883.3563 Palacios .............. 361.972.2585 409.736.5951 Port Arthur........... Ranger ............... 254.629.6729 Rising Star............ 254.629.6703 Roby .................... 325.776.2261 San Angelo*......... 325.659.5900 Southlake ............. 817.410.2915 Spring ................... 346.328.6910 Stephenville*........ 254.965.5036 Sweetwater* ......... 325.235.6600 Tomball .................. 281.516.7835 Trent ....................... 325.862.6121 Trophy Club............. 817.329.8615 Vidor........................ 409.769.8536 Waxahachie ............ 972.723.7100 Weatherford............ 817.598.2500 Willis........................ 936.890.3500 Willow Park ............. 817.598.2780 * Trust Office and Bank location A Letter To Our Shareholders :: Page 6 A Letter To Our Shareholders | Bank Locations :: Page 7 FINANCIAL HIGHLIGHTS IN THOUSANDS (except for share data) IN THOUSANDS (except for share data) FOR THE YEAR 2018 2017 % INCREASE FOR THE YEAR 2018 2017 % INCREASE NET INCOME $150,638 $120,371 25.14% AT YEAR-END Basic Earnings (PER SHARE) $2.23 $1.82 22.53% Dividends Declared $55,499 $49,648 11.78% Dividends (PER SHARE) $0.82 $0.75 9.33% Assets Securities Loans Deposits $7,731,854 $7,254,715 6.58% $3,158,777 $3,087,473 2.31% $3,975,308 $3,500,699 13.56% $6,180,389 $5,962,961 3.65% $7,606,732 $6,981,511 8.96% $3,197,107 $2,964,650 7.84% $3,828,040 $3,435,447 11.43% Shareholders’ Equity $1,053,295 $922,768 14.15% Book Value Per Share $15.55 $13.93 11.63% $6,176,619 $5,627,933 9.75% Trust Assets (Book Value) $4,293,615 $3,865,744 11.07% AVERAGES Assets Securities Loans Deposits Shareholders’ Equity $980,206 $882,813 11.03% SELECTED FINANCIAL DATA IN THOUSANDS (except for share data) YEAR-END TOTAL ASSETS SHAREHOLDERS’ EQUITY NET INCOME BASIC EARNINGS (PER SHARE) CASH DIVIDENDS (PER SHARE) STOCK DIVIDENDS AND SPLITS YEAR-END BOOK VALUE (PER SHARE) YEAR-END MARKET VALUE (PER SHARE) 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Ten-Year Compound Growth Rate $3,279,456 $415,702 $53,797 $0.86 $0.46 $3,776,367 $441,688 $59,659 $0.96 $0.46 – – $6.66 $18.08 $7.03 $17.09 $4,120,531 $508,537 $68,369 $1.09 $0.48 3/2 split $8.08 $16.72 $4,502,012 $556,963 $74,225 $1.18 $0.50 $5,222,208 $587,647 $78,868 $1.24 $0.52 – – $8.84 $19.51 $9.18 $33.06 $5,848,202 $681,537 $89,559 $1.40 $0.55 2/1 split $10.63 $29.88 $6,665,070 $804,986 $100,381 $1.55 $0.62 $6,809,931 $837,885 $104,774 $1.59 $0.70 $7,254,715 $922,768 $120,371 $1.82 $0.75 $7,731,854 $1,053,295 $150,638 $2.23 $0.82 9.18% 11.07% 10.98% 9.99% 6.18% – – – – – $12.20 $30.17 $12.68 $45.20 $13.93 $45.05 $15.55 $57.69 10.16% 12.10% Adjusted for stock dividends and splits NET INCOME GROWTH (in thousands) KEY RATIOS 2018 2017 2017 COMMON STOCK MARKET VALUE AND DIVIDEND DATA NET INTEREST MARGIN 2014 $89,559 2015 $100,381 2016 $104,774 2017 $120,371 2018 $150,638 Return On Avg. Assets 1.98% 1.72% Return On Avg. Equity 15.37% 13.63% Year-End Equity/Assets 13.62% 12.72% Efficiency 49.72% 49.26% QUARTER HIGH LOW CLOSE DIVIDENDS Fourth $48.85 $43.05 $45.05 $0.19 Third $46.00 $37.31 $45.20 $0.19 Second $44.80 $36.85 $44.20 $0.19 First $46.45 $37.55 $40.10 $0.18 2014 4.20% 2015 4.12% 2016 4.08% 2017 4.01% 2018 3.96% RETURN ON AVERAGE EQUITY EFFICIENCY RATIO 2014 14.00% 2015 13.60% 2016 12.36% 2017 13.63% 2018 15.37% 2014 49.24% 2015 47.61% 2016 49.22% 2017 49.26% 2018 49.72% 2018 COMMON STOCK MARKET VALUE AND DIVIDEND DATA RETURN ON AVERAGE ASSETS QUARTER HIGH LOW CLOSE DIVIDENDS Fourth $66.83 $53.45 $57.69 $0.21 Third $61.86 $50.55 $59.10 $0.21 Second $56.35 $45.05 $50.90 $0.21 First $49.60 $44.05 $46.30 $0.19 2014 1.65% 2015 1.61% 2016 1.59% 2017 1.72% 2018 1.98% Financial Highlights :: Page 8 Selected Financial Data :: Page 9 ABILENE REGION Abilene | Clyde | Moran | Albany | Odessa | Eastland | Ranger | Rising Star | Cisco | Sweetwater | Merkel | Trent | Roby ABILENE REGION (CONTINUED) SENIOR OFFICERS Ronald D. Butler II Chairman and CEO Marelyn Shedd President David W. Bailey President, Eastland Division Joseph Crouch President, Sweetwater Division Rodney Foster Executive Vice President Senior Lending Officer Sweetwater Vance Jones Executive Vice President Commercial Lending Jay Kidwell Executive Vice President Commercial Lending Eastland Janet O’Dell Executive Vice President Mortgage Loans Andrea Smiddy- Schlagel Executive Vice President Treasury Management Charles E. Tennesson Executive Vice President CFO and Chief Operations Officer Michael Wolverton Executive Vice President Consumer Lending Debbie Anthony Senior Vice President Vanessa Faz Senior Vice President Patty Fuentes Senior Vice President Jim Goldston Senior Vice President Tony Gorman Senior Vice President Landon Hammond Senior Vice President Jennifer Harper Senior Vice President Evan Harris Senior Vice President Candi Kanady Senior Vice President Marshall Morris Senior Vice President Corie O’Connor Senior Vice President Ryan Parrish Senior Vice President Mark Pierce Senior Vice President RONALD D. BUTLER II Chairman and CEO MARELYN SHEDD President ABILENE MAIN OFFICE 400 Pine St. Abilene, TX 79601 325.627.7000 DAVID W. BAILEY President, Eastland Division EASTLAND OFFICE 201 E. Main St. Eastland, TX 76448 254.629.6100 JOSEPH CROUCH President, Sweetwater Division SWEETWATER OFFICE 201 Elm St. Sweetwater, TX 79556 325.235.6600 Fernando Quintana Senior Vice President Steve Simmel Senior Vice President Britt Stuart Senior Vice President Dennis Tarrant Senior Vice President Steve Waller Senior Vice President REGIONAL DIRECTORS Ronald D. Butler II Chairman and CEO Marelyn Shedd President David W. Bailey President, Eastland Division Joseph Crouch President Sweetwater Division Katie Alford President and CEO Community Foundation of Abilene Donna J. Boatright CEO Rolling Plains Memorial Hospital Jeff Branson General Partner Williamson-Branson Real Estate Tucker S. Bridwell President Mansefeldt Investment Corp Louis Brooks, Jr. Rancher Paul Cannon Shareholder, President McMahon, Surovik, Suttle, P.C. Jim Keffer President EBAA Iron Sales, Inc. David Copeland, CPA President, SIPCO, Inc. and Shelton Family Foundation Tim Lancaster Former President and CEO Hendrick Health System Joe Crawford President Abilene Aero, Inc. Doug Crawley Rancher, Real Estate Mike Denny President Batjer and Associates Murray Edwards Principal The Edwards Group Jim Farrar Attorney Allan D. Frizzell Executive Vice President Enrich Oil Corporation Geoff Haney President, CEO, Partner Cape and Son Commodity Merchandising Jay Lawrence President MAL Enterprises, Inc. Kirk Massey Investments Larry May May & Hrbacek CPAs Stanley Morris, Jr. Investments Brian Perry Insurance, Investments Thomas L. Rees, Jr. Rees, Rees & Fuller, Attorneys Dale Squiers, RPh Owner Dalsan Enterprises Leigh Taliaferro, M.D. Physician Abilene Dayton Borger, Vice President and Commercial Lender in Abilene, made the Financial Exploitation/Fraud Busters presentation to more than 80 employees of the Texas Department of Aging and Disability to share how to protect yourself from fraud. “With the fast pace of technology, it is imperative that all aspects of banking and law enforcement engage with the sharing of information to stop fraud before it costs customers, businesses and society.” Detective Gabe Thompson of the Abilene Police Department’s Fraudstrike Force said, “First Financial Bank leads the market in proactive cooperation with law enforcement to ensure that the perpetrators of fraud-related crime are properly prosecuted.” IN THOUSANDS ASSETS LOANS DEPOSITS NET INCOME RETURN ON AVG. ASSETS EFFICIENCY RATIO Dec. 31, 2017 $2,458,780 $994,088 $1,968,632 $40,560 Dec. 31, 2018 $2,546,087 $1,037,688 $1,948,559 $49,774 1.67% 2.00% 42.22% 43.83% Bank Information :: Page 10 Bank Information :: Page 11 CLEBURNE REGION Cleburne | Burleson | Alvarado | Midlothian | Waxahachie CONROE REGION Conroe | Montgomery | Magnolia | Willis | Tomball | Cut and Shoot | Huntsville | New Waverly | Spring SENIOR OFFICERS REGIONAL DIRECTORS Austin EIsner Chairman, President and CEO Austin EIsner Chairman, President and CEO Duane Thomas Cleburne Market President Senior Lending Officer Dereece Howell Executive Vice President Chief Operations Officer Ray Beavers Retired General Manager and CEO United Cooperative Services Ronald D. Butler II First Financial Bankshares, Inc. Russell Phillips Executive Vice President Robert Childress III Childress Engineers AUSTIN ELSNER Chairman, President and CEO MAIN OFFICE 200 N. Ridgway Dr. Cleburne, TX 76033 817.774.5100 Mark Hill Utility Construction Consultant Tim Lyness Lyness Construction, LP Jack Scott Bell-Scott Insurance Group Alecia Bland Senior Vice President Kim Hamilton Senior Vice President John Knight Senior Vice President Chris Schjetnan Senior Vice President Stacey Sloan Senior Vice President John Mendez Vice President Asst. Chief Operations Officer IN THOUSANDS ASSETS LOANS DEPOSITS NET INCOME RETURN ON AVG. ASSETS EFFICIENCY RATIO Dec. 31, 2017 $506,842 $198,055 $455,066 Dec. 31, 2018 $553,299 $195,672 $497,224 $6,669 $8,007 1.42% 1.73% 50.35% 53.61% Cleburne Austin Elsner, President and CEO in Cleburne, sponsored a Cleburne Chamber of Commerce new member luncheon to educate local businesses on various business fraud tactics and how to prevent fraudulent check activity using First Financial’s Positive Pay tool. If your business has not seen our Fraud Prevention presentation, please call us because it’s important to know how to identify and prevent fraud from affecting your business. SENIOR OFFICERS REGIONAL DIRECTORS Sam W. Baker Chairman, President and CEO Sam W. Baker Chairman, President and CEO J. Bruce Hildebrand, CPA First Financial Bankshares, Inc. Kirby Cason President, Huntsville Division Kirby Cason President, Huntsville Division Curtis Montgomery, M.D. Physician SAM W. BAKER Chairman, President and CEO MAIN OFFICE 1800 W. White Oak Terrace Conroe, TX 77304 936.760.1888 KIRBY CASON President, Huntsville Division MAIN OFFICE 33 SH 75 North Huntsville, TX 77320 936.295.2224 G. Bart Griffith Executive Vice President Senior Lending Officer Lee Warren Executive Vice President Chief Operations Officer Michelle Murray Executive Vice President Treasury Management Chris Baughman Executive Vice President Guy Barker Senior Vice President Bobby Brennan Senior Vice President Mortgage Loan Officer Heidi Carney Senior Vice President Professional & Executive Lending Terry Doak Senior Vice President Candy Emmerich Senior Vice President Anthony Olivieri Senior Vice President Harry J. Brooks Chairman, President and CEO First Financial Bank, Kingwood Region Robert Pate Retired President Huntsville Division Johnny Peet, Jr., M.D. Physician John Sebastian Conroe Golf Cars Randy Roan Commercial Construction James B. Bexley Advisor, Sam Houston State University Donnie Buckalew Buckalew Chevrolet John J. Certa, Jr. Owner Team Auto Group Casey Collum Owner Collum Development Candyce F. Dixon CPA Chris deMilliano Operations Manager Steely Lumber Company Dan Dominey DBD Interests Lloyd Tisdale Investments F. Scott Dueser First Financial Bankshares, Inc. Robert C. Ernst, Jr. Owner Ernst Jewelers IN THOUSANDS ASSETS LOANS DEPOSITS NET INCOME RETURN ON AVG. ASSETS EFFICIENCY RATIO Dec. 31, 2017 $625,135 $446,624 $514,414 Dec. 31, 2018 $659,492 $474,416 $541,753 $8,607 $11,284 1.42% 1.71% 55.80% 55.45% Conroe Lee Warren, Executive Vice President in Conroe, and Jeff Smith, Sergeant of the Property and Financial Crimes Unit of the Conroe Police Department, work closely to stop fraud. “The hard work of our frontline staff led to the arrest of many criminals over the past two years and, due to the quick response and support of local law enforcement, including the Conroe Police, Montgomery County Sheriff and the FBI, the Region was able to save our customers more than $1 million dollars in fraudulent transactions,” said Warren. Bank Information :: Page 12 Jeff Smith and Lee Warren Bank Information :: Page 13 FORT WORTH REGION HEREFORD REGION SENIOR OFFICERS REGIONAL DIRECTORS Martin J. Noto, Jr. President and CEO Les Mariotti Executive Vice President Chief Operations Officer Jayson Green Senior Vice President Chris Shah Senior Vice President MARTIN J. NOTO, JR. President and CEO MAIN OFFICE 1000 Forest Park Blvd. Fort Worth, TX 76110 817.410.4970 Murray Edwards Chairman of the Board Principal, The Edwards Group Martin J. Noto, Jr. President and CEO Larry Anfin Past CEO Coors Distributing of Fort Worth Smith A. Brownlie III CPA and Co-Founder Brownlie & Braden Ronald D. Butler II First Financial Bankshares, Inc. Mary Lee Cruz Founding Partner E Source, Inc. Nancy Jones Past President and CEO North Texas Community Foundation Stephen Kimmel Chief Financial Officer Cook Children’s Health Care System Matt Morris President Gus Bates Insurance Paul Poston President Wellington Insurance George Robertson Managing Partner Growco Capital, LLC SENIOR OFFICERS REGIONAL DIRECTORS Mike Mauldin Chairman, President and CEO Mike Mauldin Chairman, President and CEO MIKE MAULDIN Chairman, President and CEO MAIN OFFICE 212 E. Third St. Hereford, TX 79045 806.363.8200 Tim Laws Executive Vice President Senior Lending Officer Robert de la Cruz Executive Vice President Mathew Rodriguez Vice President Chief Operations Officer Ronald D. Butler II First Financial Bankshares, Inc. Steve Lewis, D.V.M. Manager and Sr. Partner Hereford Veterinary Clinic Kade Matthews Ranching and Investments Sally Noyce Human Resource Manager Panhandle Express, LLC Jerry Stevens Owner, Stevens 5-Star Car and Truck Center Johnny E. Trotter President and CEO Livestock Investors, Ltd. IN THOUSANDS ASSETS LOANS DEPOSITS Dec. 31, 2017 $88,166 $75,356 $87,153 Dec. 31, 2018 $148,047 $136,444 $76,704 IN THOUSANDS ASSETS LOANS DEPOSITS NET INCOME RETURN ON AVG. ASSETS EFFICIENCY RATIO Dec. 31, 2017 $213,761 $146,287 $183,981 Dec. 31, 2018 $203,853 $144,677 $170,061 $3,587 $4,155 1.82% 2.02% 44.31% 45.49% Fort Worth Martin Noto, President and CEO in Fort Worth, presented the Bank’s Financial Exploitation of the Elderly seminar to the Como Senior Center in Fort Worth. Our senior population is susceptible to financial exploitation and abuse by strangers and family members alike. According to Consumer Reports, senior citizens lose $36.5 billion each year to financial abuse and approximately 36.9% of seniors are affected in any five-year period – a statistic that is more than twelve times what was previously reported. Our Fort Worth Region was recently selected as the only AARP Age Friendly Bank in Texas and will do everything it can to stop Financial Exploitation. Hereford Matthew Rodriguez, Vice President, presented a program on elder financial abuse to more than 60 residents and staff of King’s Manor Methodist Retirement Home. He also provided one-on-one counseling to several residents, listened to firsthand stories on how some residents have been previously scammed and educated residents on prevalent exploitive scams, including lottery or sweepstakes scams, IRS/Social Security scams, home repair scams and charitable giving scams. For more information on how these scams work and to identify them, please visit https://www.ffin.com/financial-exploitation. Bank Information :: Page 14 Bank Information :: Page 15 KINGWOOD REGION Kingwood | El Campo | Fulshear | Palacios SAN ANGELO REGION HARRY J. BROOKS Chairman, President and CEO MAIN OFFICE 24080 Hwy 59 N. Suite 250 Kingwood, TX 77339 281.318.4600 SENIOR OFFICERS REGIONAL DIRECTORS Harry J. Brooks Chairman, President and CEO Harry J. Brooks Chairman, President and CEO Shelley Dacus Executive Vice President Senior Lending Officer Sam Baker Chairman, President and CEO First Financial Bank, Conroe Region James Alexander Executive Vice President Commercial Lending Jeff Fuechec El Campo Market President Lee Warren Executive Vice President Chief Operations Officer Doug Faver Executive Vice President Real Estate Ken Johnson Executive Vice President Brian Bonner Senior Vice President Real Estate Brandon Zabodyn Senior Vice President Commercial Lending Nancy Powell Senior Vice President Jeff Cravey, CPA Principal Jeffrey M. Cravey PC F. Scott Dueser First Financial Bankshares, Inc. Michael Gonzalez Principal The Gonzalez Group J. Bruce Hildebrand, CPA First Financial Bankshares, Inc. Kenny Isbell President Apache Oil Company Ronnie Matthews Owner Great American Title Robert Nickles Principal Alegacy IN THOUSANDS ASSETS LOANS DEPOSITS NET INCOME RETURN ON AVG. ASSETS EFFICIENCY RATIO Dec. 31, 2018 $364,998 $318,722 $300,792 $6,055 1.63% 56.13% *Acquired January 1, 2018 Kingwood James Alexander, Executive Vice President, trained Kingwood employees on how to spot and prevent fraud perpetrated on our customers in conjunction with the Bank’s Fraud Busters Program. Employees were specifically trained on how to recognize signs and behaviors that can indicate possible exploitation of our customers. Several examples include the victim suddenly changes how they handle routine transactions, withdrawing large sums of cash without wanting to share details, appearing withdrawn or overly stressed when making financial decisions or mentioning they no longer receive bank-issued mail or important documents. CHRIS EVATT Chairman, President and CEO MAIN OFFICE 222 S. Koenigheim San Angelo, TX 76903 325.659.5900 SENIOR OFFICERS REGIONAL DIRECTORS Chris Evatt Chairman, President and CEO Chris Evatt Chairman, President and CEO Cindy George Executive Vice President Chief Operations Officer Lindy Jordan Executive Vice President Senior Lending Officer Edward Carrasco Senior Vice President Pat Cottle Senior Vice President Wes Hayes Senior Vice President Wes Masters Senior Vice President Spencer Murphy Senior Vice President Reba Priddy Senior Vice President Luke Uherik Senior Vice President Honorable Marilyn Aboussie Chief Justice, Retired Ronald D. Butler II First Financial Bankshares, Inc. Steve Eustis Commercial Real Estate Ron Giddiens Investments Partner, D&G Consulting David F. Lupton President Angelo Glass & Mirror Company, Inc. Carlos Rodriguez Attorney Webb, Stokes and Sparks Mary Jane Steadman Attorney Real Estate Investment Management IN THOUSANDS ASSETS LOANS DEPOSITS NET INCOME RETURN ON AVG. ASSETS EFFICIENCY RATIO Dec. 31, 2017 $715,102 $209,851 $625,777 Dec. 31, 2018 $747, 422 $207,503 $632,514 $11,928 $13,912 1.71% 1.87% 36.78% 37.48% San Angelo Residents of the Baptist Retirement Community in San Angelo welcomed a presentation by Brooke Weldon, Reba Priddy, Chris Evatt and Lindy Jordan. The residents greatly appreciated the fact that the Bank wanted to educate them about ways fraudsters exploit the elderly. Fraudsters are becoming increasingly more sophisticated in the way they attempt to steal information from consumers. With more consumers going online, those perpetrating fraud can make fraudulent emails look legitimate in order to gain access to banking or other financial information. This type of fraud is called phishing, and it is on the rise now more than ever. Be careful when clicking links in emails or entering sensitive information when sent via email. These could be indications someone is trying to steal your information. Bank Information :: Page 16 Bank Information :: Page 17 SOUTHEAST REGION Orange | Vidor | Mauriceville | Newton | Port Arthur | Beaumont SOUTHLAKE REGION Southlake | Trophy Club | Keller | Bridgeport | Boyd | Decatur | Grapevine STEPHEN LEE CEO and President MAIN OFFICE 812 N. 16TH St. Orange, TX 77630 800.300.8904 SENIOR OFFICERS REGIONAL DIRECTORS Stephen Lee CEO and President Blaine Callier Mid County Market President Commercial Lender Robert Kocot Beaumont Market President Commercial Lender Joe Love Executive Vice President Commercial Lender Kim Dickerson Senior Vice President Chief Operations Officer Cindi LaChance Senior Vice President Mortgage Loan Officer Curt Leger Senior Vice President Commercial Lender Tommy Gunn Chairman of the Board Attorney at Law Stephen Lee CEO and President Dr. Ray Callas Managing Partner Anesthesia Associates, PLLC F. Scott Dueser First Financial Bankshares, Inc. Len Forey Managing Partner Higginbotham Insurance Jim Gilliam President Bates & Company Owner The HT Group J. Bruce Hildebrand, CPA First Financial Bankshares, Inc. Chad Mason Vice President Mason Construction Mike Poutra Retired - Former Owner Dominion Forms Walter G. Riedel, III Chairman of the Board Nelda C. and H.J. Lutcher Stark Foundation Dayna Simmons Realtor Team Dayna Simmons Ross Smith President Akrotex, Inc. Owner Sabine River Ford, Inc. Kevin Williams President Cypress Bayou Industrial Owner American Industrial Minerals, Inc. Jim Wimberley Attorney at Law MARK L. JONES Chairman, President and CEO MAIN OFFICE 151 W. Southlake Blvd. Southlake, TX 76092 817.410.2915 SENIOR OFFICERS REGIONAL DIRECTORS Mark L. Jones Chairman, President and CEO Mark L. Jones Chairman, President and CEO F. Mills Shallene Wise County Market President Ronald D. Butler II First Financial Bankshares, Inc. Les Mariotti Executive Vice President Chief Operations Officer J. Sean Shope Executive Vice President Commercial Lender Ryan Wall Executive Vice President Consumer Lender Dickie W. Greenwood Senior Vice President Steve Sims Senior Vice President Ryan Sonntag Senior Vice President Tracie Talkington Senior Vice President Traci Bernard, BSN, RN President Texas Health Harris Methodist Hospital, Southlake William Ray Cook, Jr., CPA Cook, McDonald & Co. Martin Schelling Conifer Real Estate J. Gary Shelton Grocer Real Estate Investor Stan Stephens President Stephens Pneumatics, Inc. Tankheads, Inc. Terry Wilkinson Wyndham Properties, Ltd. IN THOUSANDS ASSETS LOANS DEPOSITS NET INCOME RETURN ON AVG. ASSETS EFFICIENCY RATIO Dec. 31, 2017 $592,473 $396,550 $504,055 Dec. 31, 2018 $584,018 $405,786 $488,496 $8,375 $11,449 1.57% 1.91% 49.08% 46.60% IN THOUSANDS ASSETS LOANS DEPOSITS NET INCOME RETURN ON AVG. ASSETS EFFICIENCY RATIO Dec. 31, 2017 $588,805 $380,863 $530,925 Dec. 31, 2018 $504,778 $388,885 $440,891 $8,291 $9,607 1.59% 1.86% 52.25% 52.39% Southeast Southeast Region President and CEO, Stephen Lee, discussed elder abuse and financial exploitation with past Athena Award recipients at the Athena Award Breakfast at the Brown Center in Orange. Detective CJ Foreman, Orange Police Department, praised the Bank for always being willing to assist the Department by providing requested information in reference to active cases, which causes the case investigations to move quickly and efficiently. “I applaud the team at First Financial Bank for their willingness and support of the criminal investigation division of the Orange Police Department,” Foreman said. Southlake Mark Jones, President and CEO in Southlake, invited Lori Varnell, Chief of Elder Financial Fraud of the Tarrant County Criminal District Attorney’s Office, to speak to employees about scam activity in Tarrant County. Ms. Varnell stated that in Tarrant County the most common fraud she sees is by the children of a widowed mother. Often there is a drug, alcohol or gambling problem and to feed the habit, the child steals from the mother. The second most common fraud her office sees is by hired caregivers. The third most prevalent fraud perpetrated is “sweetheart scams,” where a younger individual targets an elderly victim. Ms. Varnell suggests if a loved one you know receives a letter or email from someone overseas promising to move to America and marry them in exchange for the payment of attorney or immigration fees, please contact your local law enforcement immediately. Bank Information :: Page 18 Bank Information :: Page 19         STEPHENVILLE REGION Stephenville | Granbury | Glen Rose | Acton | Mineral Wells WEATHERFORD REGION Weatherford | Aledo | Willow Park | Brock SENIOR OFFICERS REGIONAL DIRECTORS Trent B. Swearengin Chairman, President and CEO Trent B. Swearengin Chairman, President and CEO Doyle Cooper Glen Rose Market President Keith Brown Prime Building Components, LLC TRENT B. SWEARENGIN Chairman, President and CEO Cory Crenshaw Mineral Wells Market President Ronald D. Butler II First Financial Bankshares, Inc. MAIN OFFICE 2201 W. South Loop Stephenville, TX 76401 254.965.5036 Bart Rodgers Granbury Market President Dereece Howell Executive Vice President Chief Operations Officer Brad Seay Executive Vice President Blayne Baley Senior Vice President Doug Dobbins Senior Vice President Donna Feller Senior Vice President Vickie Pettit Senior Vice President Trent Tidwell Senior Vice President Matt Ward Senior Vice President Regional Consumer Lending Manager George Gault Attorney Walter W. Hardin III Real Estate Investments Wendell Hollingsworth Industry & Economic Development Doug Montgomery Texstar Ford Terry L. Murphy Murphy and Murphy, Inc. Ron Pack Ranching and Investments Bill Parham Boucher Morgan & Young CPAs David Ramsey, M.D. Family Practice Center John Terrill Attorney Michael B. Williams M W Supply, Inc. IN THOUSANDS ASSETS LOANS DEPOSITS NET INCOME RETURN ON AVG. ASSETS EFFICIENCY RATIO Dec. 31, 2017 $815,630 $421,952 $693,365 Dec. 31, 2018 $843,698 $426,754 $719,035 $13,989 $17,374 1.78% 2.11% 44.59% 45.20% Stephenville Bart Rodgers, Granbury Market President, presented a program on Financial Exploitation of the Elderly at the Courtyards of Lake Granbury. Bart listened to stories of attempted exploitation of the elderly and provided tips to help avoid becoming a victim. Some of these tips include knowing that if something sounds too good to be true, it probably isn’t true, keeping personal information private, shredding bank statements, old credit and debit cards and checking your credit report once a year. SENIOR OFFICERS REGIONAL DIRECTORS Justin Hooper Chairman, President and CEO Justin Hooper Chairman, President and CEO JUSTIN HOOPER Chairman, President and CEO MAIN OFFICE 101 College Park Dr. Weatherford, TX 76086 817.596.0307 Les Mariotti Executive Vice President Chief Operations Officer Chris Cregger Senior Vice President Lori Hill Senior Vice President Jimmie Sue Lawson Senior Vice President Sean Woodring Senior Vice President Senior Lending Officer Jamie Adams Senior Vice President Briggs Freeman Sotheby’s Realty Ronald D. Butler II First Financial Bankshares, Inc. James D. Eggleston Attorney Eggleston King LLP Nan Kingsley President Bluestem Studios, Inc. Kevin R. Lackey President and CEO Freedom Power Sports Stephen E. Milliken Former President and CEO C.D. Hartnett Company Mike White, O.D. Therapeutic Optometrist IN THOUSANDS ASSETS LOANS DEPOSITS NET INCOME RETURN ON AVG. ASSETS EFFICIENCY RATIO Dec. 31, 2017 $566,656 $222,914 $481,422 Dec. 31, 2018 $560,593 $228,936 $473,062 $8,203 $10,571 1.58% 1.86% 49.44% 50.68% Weatherford Randy Roewe, Executive Vice President and Chief Risk Officer of the Holding Company, presented the Financial Exploitation/ Fraud Busters Program to more than 154 members of the East Parker County Chamber of Commerce. “Just as with many other areas of law enforcement, our success in solving financial crimes is highly dependent on collaboration between the Department, local businesses and our citizens. Because of this, the Weatherford Police Department values our partnerships with all of our local financial institutions including First Financial Bank. It is through these partnerships that we are able to successfully solve financially related crimes, protect potential victims and educate the public about the latest fraud scams,” said Detective Chris Beniak of the Weatherford Police Department. Bank Information :: Page 20 Bank Information :: Page 21 Left to Right: Kami Graves, Troy Fore, Janet O’Dell, Wes Masters, Tammie Harding, Ryan Craig, Bobby Brennan, Cindi LaChance Left to Right: Cynthia Watson, Michael Greenhaw, Laurinda Thomas, Larry Williams, John Ruzicka, David Weems, Amy O’Neal, Sammy Scott, Isabel Montoya First Financial Mortgage First Technology Services, Inc. SENIOR OFFICERS Troy Fore President Ryan Craig Executive Vice President Kami Graves Executive Vice President Tammie Harding Executive Vice President Janet O’Dell Executive Vice President Bobby Brennan Senior Vice President Cindi LaChance Senior Vice President Wes Masters Senior Vice President 2018 was another good year for First Financial Mortgage. In spite of an increase in long-term mortgage rates, pricing competition and a rise in home values, it successfully helped 1,984 individuals and families with their home financing needs totaling $464 million in originations. Technology advances continue to bring positive changes to the mortgage industry. First Financial Mortgage successfully launched its digital Mortgage App in 2018. We are always striving to improve our customer’s experience with the right technology - and with a personal touch. We continue to enjoy a healthy housing market in Texas. First Financial Mortgage is well-positioned in some of the fastest growing areas in the State. We believe these growth areas will continue to provide many positive opportunities for our company in 2019. SENIOR OFFICERS DIRECTORS John Ruzicka Chairman, President and CEO Isabel Montoya Senior Vice President Deposit Operations John Ruzicka Chairman, President and CEO First Technology Services, Inc. Executive Vice President and CIO First Financial Bankshares, Inc. Cynthia Watson Senior Vice President Chief Information Security Officer April Anthony Chief Executive Officer Encompass Home Health Homecare Homebase David Weems Senior Vice President Chief Operations Officer Larry Williams Senior Vice President Technical Architecture Michael Greenhaw Vice President Senior System Analyst Sammy Scott Vice President End User Support Manager Laurinda Thomas Assistant Vice President Debit Card and Loss Prevention Manager Amy O’Neal Operations Officer Items Processing Manager Ronald D. Butler II Executive Vice President Chief Administrative Officer First Financial Bankshares, Inc., Chairman and CEO First Financial Bank, Abilene Region F. Scott Dueser Chairman of the Board, President and CEO First Financial Bankshares, Inc. Ron Giddiens Investments Partner, D&G Consulting Gary S. Gragg Executive Vice President Lending First Financial Bankshares, Inc. J. Bruce Hildebrand, CPA Executive Vice President and Chief Financial Officer First Financial Bankshares, Inc. Monica Houston Executive Vice President Retail Banking and Training First Financial Bankshares, Inc. Les Mariotti Executive Vice President and Chief Operations Officer First Financial Bank, Fort Worth Region First Financial Bank, Southlake Region First Financial Bank, Weatherford Region Matt Melbourne Executive Vice President First Financial Trust & Asset Management Company Trent B. Swearengin Chairman, President and CEO First Financial Bank, Stephenville Region Lee Warren Executive Vice President Chief Operations Officer First Financial Bank, Conroe Region First Financial Bank, Kingwood Region Tony Wormington Retired President Jack Henry and Associates, Inc. First Financial Mortgage :: Page 22 First Technology Services :: Page 23 Abilene | Beaumont | Fort Worth | Odessa | San Angelo | Stephenville | Sweetwater Back Left to Right: Barbara Hill , David Byrd, Wayne Chowning, Lon Biebighauser, Brent S. Miller, Konrad S. Halbert Front: Left to Right David Castleberry, Kirk W. Thaxton, Bradley D. Brown Back Left to Right: Tony Gorman, Mike Wolverton, Rick Howard, Brandon Barker, Gary Milliorn, Brandon Harris, Frank Gioia, Will Christoferson Front: Left to Right Andrea Smiddy-Schlagel, Monica Houston, Michele P. Stevens First Financial Trust & Asset Management Company Line Of Business Executives First Financial Trust & Asset Management Company delivered excellent results in 2018. Total assets under management at year- end had a book value of $4.29 billion, an 11.1 percent increase from $3.87 billion at the end of 2017. The market value of the assets totaled $5.60 billion, a gain of 9.1 percent from $5.13 billion. For the year, total fee income increased 19.0 percent to $28.2 million from $23.7 million in 2017, and net earnings after tax increased 57.7 percent to $13.5 million from $8.6 million. We were pleased to add a new director to our board. Mark Rich, Director of Investments for the Kimbell Art Foundation, was elected to the board and will also serve on our Investment Committee. Mark is a valuable addition to our board. In December, we were pleased to announce the opening of our eighth trust office, which is located in the Houston area. Brent Miller will lead this office, and we look forward to its growth and success. Trust Assets (in millions) 2014 $2,774 2015 2016 2017 2018 $3,060 $3,374 $3,866 $4,294 Trust Fees (in millions) 2014 2015 $0 2016 2017 $18.77 $19.25 $19.64 $23.69 $28.18 2018 Trust Net Income (in millions) 2014 2015 2016 2017 2018 $7.109 $7.449 $7.190 $8.579 $13.532 Trust & Asset Management :: Page 24 SENIOR OFFICERS SENIOR OFFICERS (continued) Kirk W. Thaxton Chairman, President and CEO Lon Biebighauser Executive Vice President Manager, Abilene David Byrd Executive Vice President Manager, San Angelo David Castleberry Executive Vice President Manager, Stephenville Wayne Chowning Executive Vice President Manager, Sweetwater Konrad S. Halbert Executive Vice President Manager, Fort Worth Barbara Hill Executive Vice President Manager, Odessa Matt Melbourne Executive Vice President Chief Operations Officer Bradley D. Brown Senior Vice President Manager, Beaumont/Orange Brent S. Miller Senior Vice President Manager, Houston Christopher N. Montoya Senior Vice President Manager, Equities David B. Pitzer Senior Vice President Manager, Real Property Bill Rowe Senior Vice President Manager, Fixed Income Randy Spiva Senior Vice President Manager, Oil & Gas DIRECTORS Kirk W. Thaxton Chairman, President and CEO First Financial Trust & Asset Management Company, N.A. David Copeland, CPA President Shelton Family Foundation F. Scott Dueser Chairman of the Board, President and CEO First Financial Bankshares, Inc. Jay Lawrence President MAL Enterprises, Inc. David F. Lupton President Angelo Glass & Mirror Company. Inc. Bill Parham Boucher Morgan & Young CPAs Mark K. Rich Director of Investments Kimbell Art Foundation Walter G. Riedel, III Chairman of the Board Nelda C. and H.J. Lutcher Stark Foundation ADVISORY DIRECTOR John L. Beckham Attorney Beckham Rector and Eargle LLP Our line of business executives bring their expertise to our company to ensure we have the best in staffing, products and services for our customers. Their job is to continue to upgrade our lines of business while assisting our regional presidents to maximize the utilization of those products and services. We welcome Andrea Smiddy-Schlagel as Executive Vice President of Treasury Management. Andrea has the experience and expertise required to lead our treasury management team so we will be the bank of choice for every business customer. We also welcome Will Christoferson, Vice President of Advertising and Marketing, who will replace Michele Stevens when she retires in May of 2019. Michele, who has been with the Company for 22 years, has been the driving force behind our marketing initiatives during all that time. We thank her for her dedication to the Company and wish her well on her upcoming and well-deserved retirement. Our line of business executives are key to the continued growth and success of the Company and to our commitment to put YOU FIRST. SENIOR OFFICERS Monica Houston Executive Vice President Retail Banking and Training Andrea Smiddy-Schlagel Executive Vice President Treasury Management Michele P. Stevens Executive Vice President Advertising and Marketing Michael Wolverton Executive Vice President Consumer Lending Frank Gioia Senior Vice President Call Center Tony Gorman Senior Vice President Human Resources Brandon Harris Senior Vice President Appraisal Services Will Christoferson Vice President Advertising and Marketing Gary Milliorn Vice President Property Manager Brandon Barker Co-Manager First Financial Investment Advisors Rick Howard Co-Manager First Financial Investment Advisors Line of Business Executives :: Page 25 Back: Lawrence B. Kentz, Marna Yerigan, Kyle McVey, Luke Longhofer, Randy Roewe, Tim Collard, Kirk W. Thaxton, John Ruzicka, Gary S. Gragg, Michele P. Stevens Front: Ronald D. Butler II, F. Scott Dueser, J. Bruce Hildebrand, Monica Houston Back: Ron Giddiens, Johnny E. Trotter, April Anthony, F. Scott Dueser, Kade Matthews, David Copeland Front: Tucker S. Bridwell, Ross H. Smith, Tim Lancaster, Murray Edwards Corporate Information Board Of Directors OFFICERS: ANNUAL MEETING F. Scott Dueser Chairman of the Board, President and CEO Ronald D. Butler II Executive Vice President Chief Administrative Officer J. Bruce Hildebrand, CPA Executive Vice President Chief Financial Officer Gary S. Gragg Executive Vice President Chief Lending Officer Luke Longhofer Executive Vice President Chief Credit Officer Randy Roewe Executive Vice President Chief Risk Officer John Ruzicka Executive Vice President Chief Information Officer Tim Collard Executive Vice President Lending Monica Houston Executive Vice President Retail Banking and Training Michele P. Stevens Executive Vice President Advertising and Marketing Marna Yerigan Executive Vice President Lending Lawrence B. Kentz Senior Vice President Chief Compliance Officer Kyle McVey, CPA Senior Vice President Chief Accounting Officer Tuesday, April 23, 2019 Abilene Convention Center 1100 N. Sixth St. Abilene, TX 79601 10:30 a.m. FOR FINANCIAL AND INVESTOR INFORMATION: J. Bruce Hildebrand, CPA Executive Vice President Chief Financial Officer 325.627.7155 CORPORATE OFFICE TRANSFER AGENT 400 Pine St. Abilene, TX 79601 325.627.7155 800.588.7000 www.ffin.com CORPORATE MAILING ADDRESS P.O. Box 701 Abilene, TX 79604 COMMON STOCK LISTING The NASDAQ Global Select Market Symbol: FFIN INDEPENDENT PUBLIC AUDITORS Ernst & Young LLP Continental Stock Transfer & Trust Company 212.509.4000 ADDRESS SHAREHOLDER INQUIRIES TO: Continental Stock Transfer & Trust Company 1 State Street 30th Floor New York, NY 10004 CONTINENTAL STOCK TRANSFER & TRUST COMPANY WEBSITE www.continentalstock.com SEND CERTIFICATES FOR TRANSFER AND ADDRESS CHANGES TO: Continental Stock Transfer & Trust Company 1 State Street 30th floor New York, NY 10004 www.ffin.com Certain statements contained in this annual report may be considered “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. These statements are based upon the belief of the Company’s management, as well as assumptions made beyond information currently available to the Company’s management, and may be, but not necessarily are, identified by such words as “believes,” “expect,” “plan,” “anticipate,” “target,” “forecast” and “goal”. Because such forward-looking statements are subject to risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. Factors that could cause actual results to differ materially from the Company’s expectations include competition from other financial institutions and financial holding companies: the effects of and changes in trade, monetary and fiscal policies and laws, including interest rate policies of the Federal Reserve Board; changes in the demand for loans, fluctuations in value of collateral and loan reserves; inflation, interest rate, market and monetary fluctuations; changes in consumer spending, borrowing or saving habits; and acquisitions and integration of acquired businesses, and similar variables. Other key risks are described in the Company’s reports filed with the Securities and Exchange Commission, which may be obtained under “Investor Relations-Documents and Filings” on the Company’s website or by writing or calling the Company at 325.627.7155. Except as otherwise stated in this annual report, the Company does not undertake any obligation to update publicly or revise any forward-looking statements because of new information, future events or otherwise. Note: Market share data is calculated from June 30, 2018, deposit information compiled by the Federal Deposit Insurance Corporation. COMMITTEE CHAIRMEN: BOARD MEMBER YEAR COMMITTEE 1. Executive Committee: F. Scott Dueser, Chairman 2. Audit Committee: David Copeland, Chairman 3. Compensation Committee: Tim Lancaster, Chairman 4. Nominating/Corporate Governance Committee: Tucker S. Bridwell, Chairman 5. Bank Directors’ Loan Committee: Murray Edwards, Chairman F. Scott Dueser Chairman of the Board, President and CEO First Financial Bankshares, Inc. April Anthony CEO Encompass Home Health Homecare Homebase Tucker S. Bridwell, CPA* President Mansefeldt Investment Corp. David Copeland, CPA President, SIPCO, Inc. and Shelton Family Foundation Murray Edwards Principal, The Edwards Group Ron Giddiens Investments Partner, D&G Consulting Tim Lancaster Former President and CEO Hendrick Health System Kade Matthews Ranching and Investments Ross H. Smith President, Akrotex, Inc. Owner, Sabine River Ford, Inc. Johnny E. Trotter President and CEO Livestock Investors, Ltd. * Lead Director 1991 2015 1 2 2007 1, 4, 5 1998 1, 2, 4 2006 1, 2, 4, 5 2009 2, 5 2013 1, 2, 3, 4 1998 3 2014 3, 5 2003 1, 3, 4 Corporate Informations :: Page 26 Board of Directors :: Page 27 400 Pine St., Abilene, TX 79601 | 325.627.7200 | ffin.com 

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