AP NEWS

CapStar Reports Fully Diluted EPS of ($0.04) and Fully Diluted Operating EPS of $0.33 for 4Q 2018

January 25, 2019

NASHVILLE, Tenn., Jan. 24, 2019 (GLOBE NEWSWIRE) -- CapStar Financial Holdings, Inc. (“CapStar”) (NASDAQ:CSTR) reported a net loss of ($0.7) million, or ($0.04) per share on a fully diluted basis, for the three months ended December 31, 2018, compared to net income of $0.0 million, or $0.01 per share on a fully diluted basis, for the three months ended December 31, 2017. Operating(1) net income was $6.2 million, or $0.33 per share on a fully diluted basis, for the three months ended December 31, 2018, compared to $3.7 million, or $0.28, for the three months ended December 31, 2017.

Net income for the twelve months ended December 31, 2018 was $9.7 million, or $0.67 per share on a fully diluted basis, compared to net income of $1.5 million, or $0.12 per share on a fully diluted basis, for the twelve months ended December 31, 2017. Operating net income was $17.2 million, or $1.19 per share on a fully diluted basis, for the twelve months ended December 31, 2018, compared to $5.1 million, or $0.40, for the twelve months ended December 31, 2017.

“From a performance standpoint, 2018 was a good year for CapStar,” said Claire W. Tucker, CapStar’s president and chief executive officer. “We initiated a quarterly dividend for our shareholders, were named a C&I leader in U.S. Small Business Banking by Greenwich Associates, and closed our acquisition of Athens Bancshares,” Ms. Tucker continued. “I am very proud of our team’s efforts under very difficult circumstances. The sudden passing of CapStar Bank president Dan W. Hogan was a tragic loss for everyone who knew him, and he will be missed tremendously. However, the strength of the CapStar culture that Dan helped build and exemplified so well stood out in each of our associates when it mattered most. Our focus on caring for our customers and each other never wavered.”

Soundness

-- The current reserve of $12.1MM plus the $5.2MM fair value mark on acquired loans would equate to a 1.21% reserve/loans.

-- Current Criticized and Classified loans are at a low level, totaling 1.71% at December 31, 2018 compared to 2.64% at December 31, 2017.

-- Non-performing assets as a percentage of total loans and other real estate owned was 0.21% at December 31, 2018 compared to 0.28% at December 31, 2017.

-- Annualized net charge-offs to average loans was 1.27% for the three months ended December 31, 2018 compared to 0.15% for the same period in 2017.

-- Annualized net charge-offs for the year ended December 31, 2018 totaled 0.39%, compared to 1.09% for the year ended December 31, 2017.

-- The total risk based capital ratio was 12.84% at December 31, 2018 compared to 12.52% at December 31, 2017.

“CapStar’s strategy remains one of sound, profitable growth. While charge-offs are never easy to accept, our current criticized loans are at historic low points and we feel very good about our asset quality going forward,” Ms. Tucker continued.

Profitability Operating measures exclude merger-related expenses unrelated to CapStar’s normal operations. CapStar believes these measures are useful to investors as they exclude certain costs resulting from acquisition activity and allow investors to more clearly see the financial results of the CapStar’s operations.

-- Operating return on average assets (“ROAA”) for the three months ended December 31, 2018 was 1.27% compared to 1.09% for the same period in 2017.

-- Operating return on average tangible equity (“ROATE”) for the three months ended December 31, 2018 was 12.36% compared to 10.25% for the same period in 2017.

-- The net interest margin (“NIM”) for the three months ended December 31, 2018 was 3.89% compared to 3.30% for the same period in 2017.

-- The operating efficiency ratio for the three months ended December 31, 2018 was 61.83% compared to 65.63% for the same period in 2017.

“Our profitability profile improved significantly with the closing of the Athens acquisition on October 1, 2018,” said Rob Anderson, chief financial officer and chief administrative officer of CapStar. “While competition for quality loans and core deposits remains fierce, we will stick to our discipline of sound, profitable, growth.”

Growth

-- Average gross loans for the quarter ended December 31, 2018 increased 50.5% to $1.44 billion, compared to $956.4 million for the same period in 2017. o Excluding the impact of acquired loans, legacy CapStar loans increased 13.9% compared to the same period in 2017.

-- Average deposits for the quarter ended December 31, 2018 increased 46.0% to $1.58 billion, compared to $1.1 billion for the same period in 2017. o Excluding the impact of acquired deposits, legacy CapStar deposits increased 4.1% compared to the same period in 2017.

-- Average total assets for the quarter ended December 31, 2018 increased 46.0% to $1.94 billion, compared to $1.33 billion for the same period in 2017.

“With the acquisition of Athens, we experienced an increase in our loan portfolio of over 50% from the fourth quarter of 2017. Excluding the impact of acquired loans, legacy CapStar loans grew 14% since the end of last year as our bankers continue to provide excellent service and differentiate themselves with our customers,” said Mr. Anderson. “In addition, we continue to make good progress in our integration efforts with Athens Federal and are on track with our stated synergies and delivering on the economics of the merger at announcement. I’m confident the combined organization will bring even stronger value to our shareholders, our customers and the communities in which we serve,” Anderson concluded.

Dividend

On January 24, 2019, the board of directors of CapStar approved a quarterly dividend of $0.04 per share that will be paid on or about February 25, 2019 to all shareholders of record of CapStar’s capital stock as of the close of business on February 5, 2019.

Conference Call and Webcast Information

CapStar will host a conference call and webcast at 9:00 a.m. Central Time on Friday, January 25, 2019. During the call, management will review the fourth quarter results and operational highlights. Interested parties may listen to the call by dialing (844) 412-1002. The conference ID number is 1857538. A simultaneous webcast may be accessed on CapStar’s website at ir.capstarbank.com by clicking on “News & Events”. An archived version of the webcast will be available in the same location shortly after the live call has ended.

About CapStar Financial Holdings, Inc.

CapStar Financial Holdings, Inc. is a bank holding company headquartered in Nashville, Tennessee and operates primarily through its wholly owned subsidiary, CapStar Bank, a Tennessee-chartered state bank. CapStar Bank is a commercial bank that seeks to establish and maintain comprehensive relationships with its clients by delivering customized and creative banking solutions and superior client service. As of December 31, 2018, on a consolidated basis, CapStar had total assets of $1.96 billion, gross loans of $1.43 billion, total deposits of $1.57 billion, and shareholders’ equity of $254.4 million. Visit www.capstarbank.com for more information.

Forward-Looking Statements

Certain statements in this earnings release are forward-looking statements that reflect CapStar’s current views with respect to, among other things, CapStar’s assets, business, cash flows, condition (financial or otherwise), credit quality, financial performance, liquidity, short and long-term performance goals, prospects, results of operations, strategic initiatives and the timing, benefits, costs and synergies of recently completed and future acquisition, disposition and other growth opportunities, including, without limitation, those relating to the acceptance by customers of Athens of CapStar’s products and services, the ability of CapStar to meet expectations regarding the benefits, costs, synergies, and financial and operational impact of the Athens merger, the possibility that any of the anticipated benefits, costs, synergies and financial and operational improvements of the Athens merger will not be realized or will not be realized as expected, the possibility that the Athens merger integration may be more expensive or take more time to complete than anticipated, the opportunities to enhance market share in certain markets and market acceptance of CapStar are generally in new markets and CapStar’s commitment to make contributions to Athens Federal Foundation. These statements are often, but not always, made through the use of words or phrases such as “may,” “should,” “could,” “predict,” “potential,” “believe,” “will likely result,” “expect,” “continue,” “will,” “anticipate,” “seek,” “aspire,” “achieve,” “estimate,” “intend,” “plan,” “project,” “projection,” “forecast,” “roadmap,” “goal,” “guidance,” “target,” “would,” and “outlook,” or the negative version of those words or other comparable words of a future or forward-looking nature. These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections about CapStar’s industry, management’s beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond CapStar’s control. The inclusion of these forward-looking statements should not be regarded as a representation by CapStar or any other person that such expectations, estimates and projections will be achieved. Accordingly, CapStar cautions you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions and uncertainties that are difficult to predict. Although CapStar believes that the expectations reflected in these forward-looking statements are reasonable as of the date made, actual results may prove to be materially different from the results expressed or implied by the forward-looking statements. There are or will be important factors that could cause CapStar’s actual results to differ materially from those indicated in these forward-looking statements, including, but not limited to, any factors identified in this earnings release as well as those factors that are detailed from time to time in CapStar’s periodic and current reports filed with the Securities and Exchange Commission, including those factors included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017 under the headings “Item 1A. Risk Factors” and “Cautionary Note Regarding Forward Looking Statements” and in the Company’s Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. If one or more events related to these or other risks or uncertainties materialize, or if CapStar’s underlying assumptions prove to be incorrect, actual results may differ materially from its forward-looking statements. Accordingly, you should not place undue reliance on any such forward-looking statements. Any forward-looking statement speaks only as of the date of this earnings release, and CapStar 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, except as required by law. New risks and uncertainties may emerge from time to time, and it is not possible for CapStar to predict their occurrence or how they will affect CapStar.

Non-GAAP Disclaimer

This earnings release includes the following financial measures that were prepared other than in accordance with generally accepted accounting principles in the United States (“non-GAAP financial measure”): operating net income, operating diluted net income per share, operating return on average assets, operating return on average tangible equity, tangible book value per share and operating efficiency ratio. These non-GAAP financial measures (i) provide useful information to management and investors that is supplementary to CapStar’s financial condition, results of operations and cash flows computed in accordance with GAAP, (ii) enable a more complete understanding of factors and trends affecting CapStar’s business, and (iii) allow investors to evaluate CapStar’s performance in a manner similar to management, the financial services industry, bank stock analysts and bank regulators; however, CapStar acknowledges that these non-GAAP financial measures have a number of limitations. As such, you should not view these non-GAAP financial measures as a substitute for results determined in accordance with GAAP, and they are not necessarily comparable to non-GAAP financial measures that other companies use. See below for a reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measure.

CAPSTAR FINANCIAL HOLDINGS, INC. AND SUBSIDIARY

Consolidated Statements of Income (Loss) (unaudited) (dollars in thousands, except share data)

Fourth Quarter 2018 Earnings Release

Three Months Ended Year Ended December 31, December 31, ---------------------------- --------------------------- 2018 2017 2018 2017 ------------ ------------ ------------ ------------ Interest income: Loans, including fees $ 20,554 $ 11,666 $ 60,751 $ 45,601 Securities: Taxable 1,411 869 4,184 3,696 Tax-exempt 416 286 1,201 1,230 Federal funds sold 8 15 63 41 Restricted equity securities 181 125 571 396 Interest-bearing deposits in financial 330 163 1,011 551 institutions - ---------- - ---------- - ---------- - ---------- Total interest income 22,900 13,124 67,781 51,515 - ---------- - ---------- - ---------- - ---------- Interest expense: Interest-bearing deposits 1,371 608 4,164 2,447 Savings and money market accounts 1,619 827 5,446 3,188 Time deposits 1,472 694 3,940 2,445 Federal funds purchased — — 3 13 Securities sold under agreements to repurchase 3 — 3 0 Federal Home Loan Bank advances 719 477 2,533 1,559 - ---------- - ---------- - ---------- - ---------- Total interest expense 5,184 2,606 16,089 9,652 - ---------- - ---------- - ---------- - ---------- Net interest income 17,716 10,518 51,692 41,863 Provision for loan losses 1,514 (30 ) 2,842 12,870 - ---------- - ---------- - ---------- - ---------- Net interest income after provision for loan 16,202 10,548 48,850 28,993 losses - ---------- - ---------- - ---------- - ---------- Noninterest income: Treasury management and other deposit service 793 419 2,150 1,516 charges Net gain (loss) on sale of securities 1 (108 ) 3 (66 ) Tri-Net fees 276 254 1,503 1,002 Mortgage banking income 1,324 1,621 5,653 6,238 Other noninterest income 3,993 550 6,150 2,218 - ---------- - ---------- - ---------- - ---------- Total noninterest income 6,387 2,736 15,459 10,908 - ---------- - ---------- - ---------- - ---------- Noninterest expense: Salaries and employee benefits 9,475 5,411 28,586 20,400 Data processing and software 1,424 746 3,835 2,786 Professional fees 534 473 1,608 1,522 Occupancy 736 507 2,336 2,025 Equipment 810 467 2,471 2,071 Regulatory fees 364 234 1,028 1,111 Merger related expenses 8,929 — 9,803 — Other operating 1,560 861 3,820 3,850 - ---------- - ---------- - ---------- - ---------- Total noninterest expense 23,832 8,699 53,487 33,765 - ---------- - ---------- - ---------- - ---------- Income (loss) before income taxes (1,243 ) 4,585 10,822 6,136 Income tax expense (535 ) 4,494 1,167 4,635 - ---------- - ---------- - ---------- - ---------- Net income (loss) $ (708 ) $ 91 $ 9,655 $ 1,501 - ---------- - ---------- - ---------- - ---------- Per share information: Basic net income (loss) per share of common $ (0.04 ) $ 0.01 $ 0.73 $ 0.13 stock - ---------- - ---------- - ---------- - ---------- Diluted net income (loss) per share of common $ (0.04 ) $ 0.01 $ 0.67 $ 0.12 stock - ---------- - ---------- - ---------- - ---------- Weighted average shares outstanding: Basic 17,509,525 11,403,689 13,277,614 11,280,580 - ---------- - ---------- - ---------- - ---------- Diluted 18,716,562 12,938,288 14,480,347 12,803,511 - ---------- - ---------- - ---------- - ----------

This information is preliminary and based on company data available at the time of the presentation.

CAPSTAR FINANCIAL HOLDINGS, INC. AND SUBSIDIARY

Selected Quarterly Financial Data (unaudited) (dollars in thousands, except share data)

Fourth Quarter 2018 Earnings Release

Five Quarter Comparison ---------------------------------------------------------------------------- 12/31/18 9/30/18 6/30/18 3/31/18 12/31/17 ------------ ------------ ------------ ------------ ------------ Income Statement Data: Net interest income $ 17,716 $ 11,543 $ 11,587 $ 10,846 $ 10,518 Provision for loan losses 1,514 481 169 678 (30 ) - ---------- - ---------- - ---------- - ---------- - ---------- Net interest income after 16,202 11,062 11,418 10,168 10,548 provision for loan losses - ---------- - ---------- - ---------- - ---------- - ---------- Treasury management and other 793 528 427 402 419 deposit service charges Net gain (loss) on sale of 1 (1 ) 3 — (108 ) securities Tri-Net fees 276 374 325 528 254 Mortgage banking income 1,324 1,634 1,383 1,313 1,621 Other noninterest income 3,993 683 627 845 550 - ---------- - ---------- - ---------- - ---------- - ---------- Total noninterest income 6,387 3,218 2,765 3,088 2,736 - ---------- - ---------- - ---------- - ---------- - ---------- Salaries and employee benefits 9,475 6,514 6,340 6,257 5,411 Data processing and software 1,424 803 810 798 746 Professional fees 534 255 344 474 473 Occupancy 736 544 535 521 507 Equipment 810 520 602 539 467 Regulatory fees 364 228 233 203 234 Merger related expenses 8,929 540 335 — — Other operating 1,560 666 806 788 861 - ---------- - ---------- - ---------- - ---------- - ---------- Total noninterest expense 23,832 10,070 10,005 9,580 8,699 - ---------- - ---------- - ---------- - ---------- - ---------- Net income (loss) before (1,243 ) 4,210 4,178 3,676 4,585 income tax expense Income tax (benefit) expense (535 ) 554 665 483 4,494 - ---------- - ---------- - ---------- - ---------- - ---------- Net income (loss) $ (708 ) $ 3,656 $ 3,513 $ 3,193 $ 91 - ---------- - ---------- - ---------- - ---------- - ---------- Weighted average shares - 17,509,525 12,040,229 11,845,822 11,664,245 11,403,689 basic Weighted average shares - 18,716,562 13,113,775 13,067,223 12,975,759 12,938,288 diluted Net income (loss) per share, $ (0.04 ) $ 0.30 $ 0.30 $ 0.27 $ 0.01 basic Net income (loss) per share, (0.04 ) 0.28 0.27 0.25 0.01 diluted Balance Sheet Data (at period end): Cash and cash equivalents $ 105,443 $ 52,589 $ 58,222 $ 51,125 $ 82,797 Securities available-for-sale 243,808 187,469 183,364 189,580 192,621 Securities held-to-maturity 3,734 3,740 3,746 3,752 3,759 Loans held for sale 57,618 50,499 65,320 62,286 74,093 Total loans 1,429,794 1,073,870 1,046,525 1,031,821 947,537 Allowance for loan losses (12,113 ) (15,218 ) (14,705 ) (14,563 ) (13,721 ) Total assets 1,963,883 1,416,907 1,401,181 1,382,745 1,344,429 Non-interest-bearing deposits 289,552 239,792 223,579 258,161 301,742 Interest-bearing deposits 1,280,456 886,611 921,435 869,393 818,124 Federal Home Loan Bank 125,000 125,000 95,000 100,000 70,000 advances Total liabilities 1,709,504 1,259,397 1,248,035 1,234,052 1,197,483 Shareholders’ equity $ 254,379 $ 157,510 $ 153,146 $ 148,693 $ 146,946 Total shares of common stock 17,724,721 12,125,122 11,931,131 11,773,358 11,582,026 outstanding Total shares of preferred 878,048 878,048 878,049 878,049 878,049 stock outstanding Book value per share of common $ 13.84 $ 12.25 $ 12.08 $ 11.87 $ 11.91 stock Tangible book value per share 11.25 11.74 11.56 11.34 11.37 of common stock * Market value per common share $ 14.73 $ 16.72 $ 18.53 $ 18.83 $ 20.77 Capital ratios: Total risk based capital 12.84 % 12.62 % 12.53 % 12.22 % 12.52 % Tier 1 risk based capital 12.13 % 11.49 % 11.41 % 11.11 % 11.41 % Common equity tier 1 capital 11.61 % 10.83 % 10.73 % 10.43 % 10.70 % Leverage 11.06 % 11.02 % 10.87 % 10.91 % 10.77 %

*This metric is a non-GAAP financial measure. See below for discussion and reconciliation to the most directly comparable GAAP financial measure.

This information is preliminary and based on company data available at the time of the presentation.

CAPSTAR FINANCIAL HOLDINGS, INC. AND SUBSIDIARY

Selected Quarterly Financial Data (unaudited) (dollars in thousands, except share data)

Fourth Quarter 2018 Earnings Release

Five Quarter Comparison ------------------------------------------------------------------------ 12/31/18 9/30/18 6/30/18 3/31/18 12/31/17 ----------- ----------- ----------- ----------- ----------- Average Balance Sheet Data: Cash and cash equivalents $ 83,560 $ 62,787 $ 63,064 $ 60,965 $ 64,850 Investment securities 256,595 196,031 197,933 203,274 202,818 Loans held for sale 52,131 54,701 58,297 68,084 66,311 Loans 1,439,652 1,070,060 1,041,835 983,496 956,441 Assets 1,940,991 1,421,873 1,396,359 1,351,129 1,329,621 Interest bearing deposits 1,271,602 913,534 901,076 840,871 827,732 Deposits 1,579,250 1,147,274 1,138,400 1,111,182 1,081,380 Federal Home Loan Bank advances 102,304 109,728 99,121 84,533 92,554 Liabilities 1,695,181 1,265,610 1,244,824 1,202,854 1,181,954 Shareholders’ equity $ 245,811 $ 156,264 $ 151,535 $ 148,276 $ 147,667 Performance Ratios: Annualized return on average -0.14 % 1.02 % 1.01 % 0.96 % 0.03 % assets Annualized return on average -1.14 % 9.28 % 9.30 % 8.74 % 0.25 % equity Net interest margin (1) 3.89 % 3.35 % 3.46 % 3.39 % 3.30 % Annualized Non-interest income to 1.31 % 0.90 % 0.79 % 0.93 % 0.82 % average assets Efficiency ratio 98.9 % 68.2 % 69.7 % 68.8 % 65.6 % Loans by Type (at period end): Commercial and industrial $ 404,600 $ 398,626 $ 386,065 $ 408,353 $ 373,248 Commercial real estate - owner 141,932 117,904 121,475 131,741 101,132 occupied Commercial real estate - non-owner 408,514 286,848 286,769 258,016 249,490 occupied Construction and development 174,670 129,799 96,580 91,953 82,586 Consumer real estate 253,562 112,957 109,915 104,224 102,581 Consumer 25,615 8,274 9,671 9,524 6,862 Other $ 21,002 $ 19,792 $ 36,428 $ 28,750 $ 31,984 Asset Quality Data: Allowance for loan losses to total 0.85 % 1.42 % 1.41 % 1.41 % 1.45 % loans Allowance for loan losses to 583 % 271 % 271 % 1096 % 509 % non-performing loans Nonaccrual loans $ 2,078 $ 5,610 $ 5,419 $ 1,329 $ 2,695 Troubled debt restructurings 2,947 1,146 1,173 1,190 1,206 Loans - over 89 days past due and 214 215 216 - 231 accruing Total non-performing loans 2,078 5,610 5,419 1,329 2,695 OREO and repossessed assets 988 - - - - Total non-performing assets $ 3,066 $ 5,610 $ 5,419 $ 1,329 $ 2,695 Non-performing loans to total 0.15 % 0.52 % 0.52 % 0.13 % 0.28 % loans Non-performing assets to total 0.16 % 0.40 % 0.39 % 0.10 % 0.20 % assets Non-performing assets to total 0.21 % 0.52 % 0.52 % 0.13 % 0.28 % loans and OREO Annualized net charge-offs 1.27 % (0.01 )% 0.01 % -0.07 % 0.15 % (recoveries) to average loans Net charge-offs (recoveries) $ 4,620 $ (32 ) $ 27 $ (165 ) $ 372 Interest Rates and Yields: Loans 5.49 % 5.00 % 5.04 % 4.74 % 4.54 % Securities (1) 3.30 % 2.85 % 2.82 % 2.68 % 2.83 % Total interest-earning assets (1) 5.02 % 4.58 % 4.58 % 4.29 % 4.11 % Deposits 1.12 % 1.22 % 1.11 % 0.88 % 0.78 % Borrowings and repurchase 2.76 % 2.53 % 2.53 % 2.35 % 2.04 % agreements Total interest-bearing liabilities 1.50 % 1.64 % 1.51 % 1.27 % 1.12 % Other Information: Full-time equivalent employees 286 185 183 182 175

This information is preliminary and based on company data available at the time of the presentation.

(1) Net Interest Margin, Securities yields, and Total interest-earning asset yields are calculated on a tax-equivalent basis

CAPSTAR FINANCIAL HOLDINGS, INC. AND SUBSIDIARY

Analysis of Interest Income and Expense, Rates and Yields (unaudited) (dollars in thousands)

Fourth Quarter 2018 Earnings Release

For the Three Months Ended December 31, ---------------------------------------------------------------- 2018 2017 ------------------------------ ------------------------------ Average Interest Averag Average Interest Averag Outstanding Income/ e Outstanding Income/ e Balance Expense Yield/ Balance Expense Yield/ Rate Rate ----------- -------- ----- ----------- -------- ----- Interest-Earning Assets Loans (1) $ 1,439,652 $ 19,904 5.49 % $ 956,441 $ 10,950 4.54 % Loans held for sale 52,131 650 4.95 % 66,311 716 4.28 % Securities: Taxable investment securities (2) 198,799 1,592 3.20 % 153,882 994 2.58 % Investment securities exempt from 57,796 416 3.64 % 48,936 286 3.60 % federal income tax (3) - --------- - ------ ---- - --------- - ------ ---- Total securities 256,595 2,008 3.30 % 202,818 1,280 2.83 % Cash balances in other banks 67,880 330 1.93 % 52,988 163 1.22 % Funds sold 1,047 8 2.92 % 2,989 15 2.04 % - --------- - ------ ---- - --------- - ------ ---- Total interest-earning assets 1,817,305 22,900 5.02 % 1,281,547 13,124 4.11 % Noninterest-earning assets 123,686 48,074 - --------- - --------- Total assets $ 1,940,991 $ 1,329,621 - --------- - --------- Interest-Bearing Liabilities Interest-bearing deposits: Interest-bearing transaction accounts $ 437,656 1,371 1.24 % $ 281,881 608 0.86 % Savings and money market deposits 496,319 1,619 1.29 % 346,639 827 0.95 % Time deposits 337,628 1,472 1.73 % 199,212 694 1.38 % - --------- - ------ ---- - --------- - ------ ---- Total interest-bearing deposits 1,271,603 4,462 1.39 % 827,732 2,129 1.02 % Borrowings and repurchase agreements 103,655 722 2.76 % 92,554 477 2.04 % - --------- - ------ ---- - --------- - ------ ---- Total interest-bearing liabilities 1,375,258 5,184 1.50 % 920,286 2,606 1.12 % Noninterest-bearing deposits 307,648 253,647 - --------- - --------- Total funding sources 1,682,905 1,173,933 Noninterest-bearing liabilities 12,275 8,021 Shareholders’ equity 245,811 147,667 - --------- - --------- Total liabilities and shareholders’ equity $ 1,940,991 $ 1,329,621 - --------- - --------- Net interest spread (4) 3.53 % 2.99 % - ------ - ------ Net interest income/margin (5) $ 17,716 3.89 % $ 10,518 3.30 % - ------ - ------

(1) Average loan balances include nonaccrual loans. Interest income on loans includes amortization of deferred loan fees, net of deferred loan costs. (2) Taxable investment securities include restricted equity securities. (3) Yields on tax exempt securities, total securities, and total interest-earning assets are shown on a tax equivalent basis. (4) Net interest spread is the average yield on total average interest-earning assets minus the average rate on total average interest-bearing liabilities (5) Net interest margin is annualized net interest income calculated on a tax equivalent basis divided by total average interest-earning assets for the period.

This information is preliminary and based on company data available at the time of the presentation.

CAPSTAR FINANCIAL HOLDINGS, INC. AND SUBSIDIARY

Analysis of Interest Income and Expense, Rates and Yields (unaudited) (dollars in thousands)

Fourth Quarter 2018 Earnings Release

For the Year Ended December 31, ---------------------------------------------------------------- 2018 2017 ------------------------------ ------------------------------ Average Interest Averag Average Interest Averag (Amounts in thousands) Outstanding Income/ e Outstanding Income/ e Balance Expense Yield/ Balance Expense Yield/ Rate Rate ----------- -------- ----- ----------- -------- ----- Interest-Earning Assets Loans (1) $ 1,134,836 $ 57,962 5.11 % $ 987,710 $ 43,531 4.41 % Loans held for sale 58,250 2,789 4.79 % 49,466 2,070 4.19 % Securities: Taxable investment securities (2) 166,287 4,755 2.86 % 166,538 4,092 2.46 % Investment securities exempt from 47,270 1,201 3.22 % 52,153 1,230 3.63 % federal income tax (3) - --------- - ------ ---- - --------- - ------ ---- Total securities 213,557 5,956 2.94 % 218,691 5,322 2.74 % Cash balances in other banks 54,454 1,011 1.85 % 49,990 551 1.10 % Funds sold 2,483 63 2.55 % 2,518 41 1.63 % - --------- - ------ ---- - --------- - ------ ---- Total interest-earning assets 1,463,579 67,781 4.65 % 1,308,375 51,515 3.99 % Noninterest-earning assets 65,336 49,419 - --------- - --------- Total assets $ 1,528,915 $ 1,357,794 - --------- - --------- Interest-Bearing Liabilities Interest-bearing deposits: Interest-bearing transaction accounts $ 330,952 4,164 1.26 % $ 301,411 2,447 0.81 % Savings and money market deposits 424,052 5,446 1.28 % 378,640 3,188 0.84 % Time deposits 227,760 3,940 1.73 % 194,892 2,444 1.25 % - --------- - ------ ---- - --------- - ------ ---- Total interest-bearing deposits 982,764 13,550 1.38 % 874,943 8,079 0.92 % Borrowings and repurchase agreements 99,450 2,539 2.55 % 98,289 1,572 1.60 % - --------- - ------ ---- - --------- - ------ ---- Total interest-bearing liabilities 1,082,214 16,089 1.49 % 973,232 9,651 0.99 % Noninterest-bearing deposits 262,280 232,687 - --------- - --------- Total funding sources 1,344,494 1,205,919 Noninterest-bearing liabilities 8,735 8,474 Shareholders’ equity 175,686 143,402 - --------- - --------- Total liabilities and shareholders’ equity $ 1,528,915 $ 1,357,795 - --------- - --------- Net interest spread (4) 3.17 % 3.00 % - ------ - ------ Net interest income/margin (5) $ 51,692 3.55 % $ 41,864 3.25 % - ------ - ------

(1) Average loan balances include nonaccrual loans. Interest income on loans includes amortization of deferred loan fees, net of deferred loan costs. (2) Taxable investment securities include restricted equity securities. (3) Yields on tax exempt securities, total securities, and total interest-earning assets are shown on a tax equivalent basis. (4) Net interest spread is the average yield on total average interest-earning assets minus the average rate on total average interest-bearing liabilities. (5) Net interest margin is annualized net interest income calculated on a tax equivalent basis divided by total average interest-earning assets for the period.

This information is preliminary and based on company data available at the time of the presentation.

CAPSTAR FINANCIAL HOLDINGS, INC. AND SUBSIDIARY

Non-GAAP Financial Measures (unaudited) (dollars in thousands except share data)

Fourth Quarter 2018 Earnings Release

Three Months Ended ---------------------------------------------------------------------------- December September June 30, March 31, December 31, 2018 30, 2018 2018 2018 31, 2017 ------------ ------------ ------------ ------------ ------------ Operating net income: Net income (loss) $ (708 ) $ 3,656 $ 3,513 $ 3,193 $ 91 Add: impact of tax reform* — — — — 3,562 Add: merger related expenses 8,929 540 335 — — Less: income tax impact of (1,985 ) (141 ) (88 ) — — merger related expenses - ---------- - ---------- - ---------- - ---------- - ---------- Operating net income $ 6,236 $ 4,055 $ 3,760 $ 3,193 $ 3,653 - ---------- - ---------- - ---------- - ---------- - ---------- Operating diluted net income per share of common stock: Operating net income $ 6,236 $ 4,055 $ 3,760 $ 3,193 $ 3,653 Weighted average shares - 18,716,562 13,113,775 13,067,223 12,975,759 12,938,288 diluted - ---------- - ---------- - ---------- - ---------- - ---------- Operating diluted net income $ 0.33 $ 0.31 $ 0.29 $ 0.25 $ 0.28 per share of common stock - ---------- - ---------- - ---------- - ---------- - ---------- Operating annualized return on average assets: Operating net income $ 6,236 $ 4,055 $ 3,760 $ 3,193 $ 3,653 Average assets $ 1,940,991 $ 1,421,873 $ 1,396,359 $ 1,351,129 $ 1,329,621 - ---------- - ---------- - ---------- - ---------- - ---------- Operating annualized return on 1.27 % 1.13 % 1.08 % 0.96 % 1.09 % average assets - ---------- - ---------- - ---------- - ---------- - ---------- Operating annualized return on average tangible equity: Average total shareholders’ $ 245,811 $ 156,264 $ 151,535 $ 148,276 $ 147,667 equity Less: average intangible (45,687 ) (6,220 ) (6,228 ) (6,238 ) (6,248 ) assets - ---------- - ---------- - ---------- - ---------- - ---------- Average tangible equity 200,124 150,044 145,307 142,038 141,419 - ---------- - ---------- - ---------- - ---------- - ---------- Operating net income $ 6,236 $ 4,055 $ 3,760 $ 3,193 $ 3,653 - ---------- - ---------- - ---------- - ---------- - ---------- Operating annualized return on 12.36 % 10.72 % 10.38 % 9.12 % 10.25 % average tangible equity - ---------- - ---------- - ---------- - ---------- - ---------- Operating efficiency ratio: Total noninterest expense $ 23,832 $ 10,070 $ 10,005 $ 9,580 $ 8,699 Less: merger related expenses (8,929 ) (540 ) (335 ) — — - ---------- - ---------- - ---------- - ---------- - ---------- Total operating noninterest 14,903 9,530 9,670 9,580 8,699 expense - ---------- - ---------- - ---------- - ---------- - ---------- Net interest income 17,716 11,543 11,587 10,846 10,518 Total noninterest income 6,387 3,218 2,765 3,088 2,736 - ---------- - ---------- - ---------- - ---------- - ---------- Total revenues $ 24,103 $ 14,761 $ 14,352 $ 13,934 $ 13,254 - ---------- - ---------- - ---------- - ---------- - ---------- Operating efficiency ratio: 61.83 % 64.56 % 67.38 % 68.75 % 65.63 % - ---------- - ---------- - ---------- - ---------- - ---------- December September June 30, March 31, December 31, 2018 30, 2018 2018 2018 31, 2017 ------------ ------------ ------------ ------------ ------------ Tangible Equity: Total shareholders’ equity $ 254,379 $ 157,510 $ 153,146 $ 148,693 $ 146,946 Less: intangible assets (46,048 ) (6,219 ) (6,222 ) (6,232 ) (6,242 ) - ---------- - ---------- - ---------- - ---------- - ---------- Tangible equity $ 208,331 $ 151,291 $ 146,924 $ 142,461 $ 140,704 - ---------- - ---------- - ---------- - ---------- - ---------- Tangible Common Equity: Tangible equity $ 208,331 $ 151,291 $ 146,924 $ 142,461 $ 140,704 Less: preferred equity (9,000 ) (9,000 ) (9,000 ) (9,000 ) (9,000 ) - ---------- - ---------- - ---------- - ---------- - ---------- Tangible common equity $ 199,331 $ 142,291 $ 137,924 $ 133,461 $ 131,704 - ---------- - ---------- - ---------- - ---------- - ---------- Tangible Book Value per Share of Common Stock: Tangible common equity $ 199,331 $ 142,291 $ 137,924 $ 133,461 $ 131,704 Total shares of common stock 17,724,721 12,125,122 11,931,131 11,773,358 11,582,026 outstanding - ---------- - ---------- - ---------- - ---------- - ---------- Tangible book value per share $ 11.25 $ 11.74 $ 11.56 $ 11.34 $ 11.37 of common stock - ---------- - ---------- - ---------- - ---------- - ----------

*As a result of the Tax Cuts and Jobs Act of 2017, which included a Federal corporate tax rate change from 35% to 21%, we revalued our deferred tax assets, which resulted in a $3.6 million increase in income tax expense for 2017. The non-GAAP operating ratios above have excluded the impact of this transaction.

CAPSTAR FINANCIAL HOLDINGS, INC. AND SUBSIDIARY

Non-GAAP Financial Measures (unaudited) (dollars in thousands except share data)

Fourth Quarter 2018 Earnings Release

Year Ended ---------------------------- December 31, December 31, 2018 2017 ------------ ------------ Operating net income: Net income $ 9,655 $ 1,501 Add: impact of tax reform* — 3,562 Add: merger related expenses 9,803 — Less: income tax impact of merger related expenses (2,213 ) — - ---------- - ---------- Operating net income $ 17,245 $ 5,063 - ---------- - ---------- Operating diluted net income per share of common stock: Operating net income $ 17,245 $ 5,063 Weighted average shares - diluted 14,480,347 12,803,511 - ---------- - ---------- Operating diluted net income $ 1.19 $ 0.40 per share of common stock - ---------- - ---------- Operating annualized return on average assets: Operating net income $ 17,245 $ 5,063 Average assets $ 1,528,915 $ 1,357,794 - ---------- - ---------- Operating annualized return on 1.13 % 0.37 % average assets - ---------- - ---------- Operating annualized return on average tangible equity: Average total shareholders’ equity $ 175,686 $ 143,402 Less: average intangible assets (16,174 ) (6,265 ) - ---------- - ---------- Average tangible equity 159,512 137,137 - ---------- - ---------- Operating net income $ 17,245 $ 5,063 - ---------- - ---------- Operating annualized return on 10.81 % 3.69 % average tangible equity - ---------- - ---------- Operating efficiency ratio: Total noninterest expense $ 53,487 $ 33,765 Less: merger related expenses (9,803 ) — - ---------- - ---------- Total operating noninterest expense 43,684 33,765 - ---------- - ---------- Net interest income 51,692 41,863 Total noninterest income 15,459 10,908 - ---------- - ---------- Total revenues $ 67,151 $ 52,771 - ---------- - ---------- Operating efficiency ratio: 65.05 % 63.98 % - ---------- - ----------

*As a result of the Tax Cuts and Jobs Act of 2017, which included a Federal corporate tax rate change from 35% to 21%, we revalued our deferred tax assets, which resulted in a $3.6 million increase in income tax expense for 2017. The non-GAAP operating ratios above have excluded the impact of this transaction.

(1) For a discussion and reconciliation of the Non-GAAP operating measures that exclude merger-related costs unrelated to CapStar’s normal operations, see the section titled “Non-GAAP Disclaimer” and the Non-GAAP financial measures section of the financial statements.

CONTACT

Rob Anderson Chief Financial Officer and Chief Administrative Officer (615) 732-6470

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