UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

______________________________

 

FORM 8-K

 

CURRENT REPORT PURSUANT TO

SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

 

Date of Report (Date of earliest event reported): April 24, 2019

 

______________________________

 

CAPSTAR FINANCIAL HOLDINGS, INC.

(Exact name of registrant as specified in its charter)

 

 

 

 

Registrant’s telephone number, including area code    (615) 732-6400

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

[  ]   Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

[  ]   Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

[  ]   Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

[  ]   Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter). Emerging growth company [X]

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [X]

 

 

 

 

 

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Section 2 – Financial Information

 

Item 2.02.  Results of Operations and Financial Condition.

 

On April 24, 2019, CapStar Financial Holdings, Inc. (the “Company”) issued an earnings release announcing its financial results for the first quarter ended March 31, 2019.  A copy of the earnings release is furnished as Exhibit 99.1 to this Current Report on Form 8-K (this “Report”) and is incorporated herein by reference.

 

The Company will conduct a conference call at 5:00 p.m. (Central Time) on April 24, 2019 to discuss its financial results for the first quarter ended March 31, 2019.  A copy of the presentation to be used for the conference call is furnished as Exhibit 99.2 to this Report and is incorporated herein by reference.

 

Section 7 – Regulation FD

 

Item 7.01.  Regulation FD Disclosure.

 

The information disclosed under Item 2.02 of this Report is incorporated by reference into this Item 7.01.

 

Section 9 – Financial Statements and Exhibits

 

Item 9.01.  Financial Statements and Exhibits.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

 

 

 

 

Date: April 24, 2019

 

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Exhibit 99.1

EARNINGS RELEASE

 

CONTACT

 

Rob Anderson

Chief Financial Officer and Chief Administrative Officer

(615) 732-6470

 

 

 

 

CapStar Reports Fully Diluted EPS of $0.25 and Fully Diluted Operating EPS of $0.28 for 1Q2019

 

NASHVILLE, TN, April 24, 2019/GlobeNewswire/ -- CapStar Financial Holdings, Inc. (“CapStar”) (NASDAQ:CSTR) reported net income of $4.78 million, or $0.25 per share on a fully diluted basis, for the three months ended March 31, 2019, compared to net income of $3.20 million, or $0.25 per share on a fully diluted basis, for the three months ended March 31, 2018.  Operating⁽¹⁾ net income was $5.22 million, or $0.28 per share on a fully diluted basis, for the three months ended March 31, 2019, compared to $3.20 million, or $0.25, for the three months ended March 31, 2018.  

 

“Our first quarter operating performance is reflective of our stated strategy of sound, profitable growth,” said Claire W. Tucker, CapStar’s president and chief executive officer. “Our capital base remains solid with total risk based capital ratio of 12.64% and asset quality is strong evidenced by the low levels of non-performing assets and net charge-offs. We posted operating net income exclusive of merger related charges of $5.22 million resulting in operating return on average assets of 1.06%. Our team of experienced bankers continues to focus on developing full relationships with our clients by winning loan, deposit and treasury management business,” Ms. Tucker continued.  “We are excited to begin 2019 with our partners in East Tennessee with a shared passion for high quality customer service, continued market penetration and enhanced shareholder value.”

 

Soundness

 

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.

 

 

 

(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.

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“Despite a challenging macro-economic environment with a flat to inverted yield curve, we grew our operating earnings per share by 12.0% from the same period last year and our return on average tangible equity grew to 10.02%,” said Rob Anderson, chief financial officer and chief administrative officer of CapStar. “These are strong fundamental operating metrics that demonstrate our strategy of sound, profitable, growth.”

 

Growth

 

“With the acquisition of Athens Federal, we grew our balance sheet in excess of 47.2% from the prior year,” said Mr. Anderson.  “In addition, we have successfully converted all legacy systems and branding so we now operate as one unified team, under one brand and on one core platform.  The entire organization is energized and excited about the opportunities in front of us.”

 

 Conference Call and Webcast Information

 

CapStar will host a conference call and webcast at 5:00 p.m. Central Time on Wednesday April 24, 2019.  During the call, management will review the first quarter results and operational highlights.  Interested parties may listen to the call by dialing (844) 412-1002.  The conference ID number is 1094947.  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 March 31, 2019, on a consolidated basis, CapStar had total assets of $2.04 billion, gross loans of $1.47 billion, total deposits of $1.68 billion, and shareholders’ equity of $259.75 million.  Visit www.capstarbank.com for more information.

 

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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 and the opportunities to enhance market share in certain markets and market acceptance of CapStar are generally in new markets. 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, 2018 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.  

 

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CAPSTAR FINANCIAL HOLDINGS, INC. AND SUBSIDIARY

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

First Quarter 2019 Earnings Release

 

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

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CAPSTAR FINANCIAL HOLDINGS, INC. AND SUBSIDIARY

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

First Quarter 2019 Earnings Release

_____________________

*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.

 

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CAPSTAR FINANCIAL HOLDINGS, INC. AND SUBSIDIARY

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

First Quarter 2019 Earnings Release

 

_____________________

 

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

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CAPSTAR FINANCIAL HOLDINGS, INC. AND SUBSIDIARY

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

First Quarter 2019 Earnings Release

 

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

 

 

 

 

 

 

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CAPSTAR FINANCIAL HOLDINGS, INC. AND SUBSIDIARY

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

First Quarter 2019 Earnings Release

 

 

 

 

 

First Quarter 2019 Earnings Call April 24, 2019 Exhibit 99.2

Terminology The terms “we,” “our,” “us,” “the Company,” “CSTR” and “CapStar” that appear in this presentation refer to CapStar Financial Holdings, Inc. and its wholly owned subsidiary, CapStar Bank. The terms “CapStar Bank,” “the Bank” and “our Bank” that appear in this presentation refer to CapStar Bank. Contents of Presentation Except as is otherwise expressly stated in this presentation, the contents of this presentation are presented as of the date on the front cover of this presentation. Market Data Market data used in this presentation has been obtained from government and independent industry sources and publications available to the public, sometimes with a subscription fee, as well as from research reports prepared for other purposes. Industry publications and surveys and forecasts generally state that the information contained therein has been obtained from sources believed to be reliable. CSTR did not commission the preparation of any of the sources or publications referred to in this presentation. CSTR has not independently verified the data obtained from these sources, and, although CSTR believes such data to be reliable as of the dates presented, it could prove to be inaccurate. Forward-looking information obtained from these sources is subject to the same qualifications and the additional uncertainties regarding the other forward-looking statements in this presentation. Non-GAAP Disclaimer This presentation includes the following financial measures that have been prepared other than in accordance with generally accepted accounting principles in the United States (“non-GAAP financial measures”): pre-tax, pre-provision net income, pre-tax, pre-provision return on average assets, tangible equity, tangible common equity, tangible assets, return on average tangible equity, return on average tangible common equity, book value per share (as adjusted), tangible book value per share (as reported and as adjusted), tangible equity to tangible assets, tangible common equity to tangible assets and adjusted shares outstanding at the end of the period. CSTR non-GAAP financial measures (i) provide useful information to management and investors that is supplementary to its financial condition, results of operations and cash flows computed in accordance with GAAP, (ii) enable a more complete understanding of factors and trends affecting CSTR’s business, and (iii) allow investors to evaluate CSTR’s performance in a manner similar to management, the financial services industry, bank stock analysts and bank regulators; however, CSTR acknowledges that its non-GAAP financial measures have a number of limitations. As such, you should not view these disclosures 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 the Appendix to this presentation for a reconciliation of non-GAAP financial measures to the most directly comparable GAAP financial measures. Disclaimers

Certain statements in this presentation are forward-looking statements that reflect our current views with respect to, among other things, future events and our financial and operational performance. 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,” “estimate,” “intend,” “plan,” “project,” “projection,” “forecast,” “ roadmap,” “goal,” “target,” “guidance”, “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 our industry, management’s beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond our control. The inclusion of these forward-looking statements should not be regarded as a representation by us or any other person that such expectations, estimates and projections will be achieved. Accordingly, we caution 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 we believe 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 our actual results to differ materially from those indicated in these forward-looking statements, including, but not limited to, the following: The acceptance by customers of Athens of the Company’s products and services; the ability of the Company 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 acceptance of the Company generally in new markets; economic conditions (including interest rate environment, government economic and monetary policies, the strength of global financial markets and inflation and deflation) that impact the financial services industry as a whole and/or our business; the concentration of our business in the Nashville metropolitan statistical area (“MSA”) and the effect of changes in the economic, political and environmental conditions on this market; increased competition in the financial services industry, locally, regionally or nationally, which may adversely affect pricing and the other terms offered to our clients; an increase in the cost of deposits, loss of deposits or a change in the deposit mix, which could increase our cost of funding; an increase in the costs of capital, which could negatively affect our ability to borrow funds, successfully raise additional capital or participate in strategic acquisition opportunities; our dependence on our management team and board of directors and changes in our management and board composition; our reputation in the community; our ability to execute our strategy and to achieve our loan ROAA and efficiency ratio goals, hire seasoned bankers, loan and deposit growth through organic growth and strategic acquisitions; credit risks related to the size of our borrowers and our ability to adequately identify, assess and limit our credit risk; our concentration of large loans to a small number of borrowers; the significant portion of our loan portfolio that originated during the past two years and therefore may less reliably predict future collectability than older loans; the adequacy of reserves (including our allowance for loan losses) and the appropriateness of our methodology for calculating such reserves; non-performing loans and leases; non-performing assets; charge-offs, non-accruals, troubled debt restructurings, impairments and other credit-related issues; adverse trends in the healthcare service industry, which is an integral component of our market’s economy; our management of risks inherent in our commercial real estate loan portfolio, and the risk of a prolonged downturn in the real estate market, which could impair the value of our collateral and our ability to sell collateral upon any foreclosure; governmental legislation and regulation, including changes in the nature and timing of the adoption and effectiveness of new requirements under the Dodd-Frank Act of 2010, as amended, Basel guidelines, capital requirements, accounting regulation or standards and other applicable laws and regulations; the impact of the Tax Cuts and Job Act of 2017, as amended, on the Company and its financial performance and results of operations; the loss of large depositor relationships, which could force us to fund our business through more expensive and less stable sources; operational and liquidity risks associated with our business, including liquidity risks inherent in correspondent banking; volatility in interest rates and our overall management of interest rate risk, including managing the sensitivity of our interest-earning assets and interest-bearing liabilities to interest rates, and the impact to our earnings from a change in interest rates; the potential for our bank’s regulatory lending limits and other factors related to our size to restrict our growth and prevent us from effectively implementing our business strategy; strategic acquisitions we may undertake to achieve our goals; the sufficiency of our capital, including sources of capital and the extent to which we may be required to raise additional capital to meet our goals; fluctuations in the fair value of our investment securities that are beyond our control; deterioration in the fiscal position of the U.S. government and downgrades in Treasury and federal agency securities; potential exposure to fraud, negligence, computer theft and cyber-crime; the adequacy of our risk management framework; our dependence on our information technology and telecommunications systems and the potential for any systems failures or interruptions; threats to and breaches of our information technology systems and data security, including cyber-attacks; our dependence upon outside third parties for the processing and handling of our records and data; our ability to adapt to technological change; the financial soundness of other financial institutions; our exposure to environmental liability risk associated with our lending activities; our engagement in derivative transactions; our involvement from time to time in legal proceedings and examinations and remedial actions by regulators; the susceptibility of our market to natural disasters and acts of God; and the effectiveness of our internal controls over financial reporting and our ability to remediate any future material weakness in our internal controls over financial reporting. The foregoing factors should not be construed as exhaustive and should be read in conjunction with those factors that are detailed from time to time in the Company’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, 2018 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 our underlying assumptions prove to be incorrect, actual results may differ materially from our 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 presentation, and we do 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 us to predict their occurrence or how they will affect us. Safe Harbor Statements

Operating Net income of $5.22MM for the first quarter 2019. Fully Diluted GAAP EPS of $0.25. Operating EPS(1) of $0.28 which is a 12% increase vs. 1Q18 of $0.25. Tangible Book Value per share grew from $11.25 to $11.55, an 11% increase (annualized) from prior quarter (4Q18). Annualized EOP Loan growth of 10.8% over 4Q18. Annualized EOP Deposit growth of 28.1% over 4Q18. Operating Return on Average Assets(1) of 1.06%; ROATE of 10.02%. Current Criticized and Classified loans continue to be at a low level. Successful Brand and Core Conversion of Athens Federal. First Quarter 2019 Highlights Operating results are non-GAAP financial measures that adjust GAAP reported net income and other metrics for certain income and expense items as outlined in the non-GAAP reconciliation calculations included in the Appendix at the end of this presentation using a blended statutory income tax rate of 26.14% excluding deductible one-time merger related items.

Sound, Profitable, Growth Financial Metrics - 1Q19 Operating results are non-GAAP financial measures that adjust GAAP reported net income and other metrics for certain income and expense items as outlined in the non-GAAP reconciliation calculations included in the Appendix at the end of this presentation using a blended statutory income tax rate of 26.14% excluding deductible one-time merger related items. Efficiency ratio is non-interest expense divided by the sum of net interest income and non-interest income Calculated on a tax equivalent basis.     Operating Metrics1 1Q19 4Q18 1Q18                     Soundness Allowance for Loan Losses to Total Loans and Leases 0.88% 0.85% 1.41% Net Charge-Offs to Average Loans (Periods Annualized) 0.01% 1.27% -0.07% Non-Performing Assets/Assets 0.14% 0.16% 0.10% Total Risk Based Capital Ratio 12.64% 12.84% 12.22% Tangible Equity / Tangible Assets 10.76% 10.86% 10.35% Tangible Book Value per Share $11.55 $11.25 $11.34 Profitability   Return on Average Assets (ROAA) 1.06% 1.27% 0.96%   Return on Average Equity (ROAE) 8.23% 10.06% 8.74%   Return on Average Tangible Equity (ROATE) 10.02% 12.36% 9.12%   Efficiency Ratio2 65.01% 61.83% 68.74%   Net Interest Margin3 (tax equivalent basis) 3.75% 3.89% 3.39%                         Growth Operating Net Income $5.22 $6.24 $3.20 Diluted EPS $0.28 $0.33 $0.25   Gross Loans and Leases (EOP) $1,468 $1,430 $1,032   Total Deposits (EOP) 1,679 1,570 1,128   Total Assets (EOP) 2,036 1,964 1,383

Loan Growth EOP Loans increased 10.8% on an annualized basis from 4Q18. Excluding Day 1 loans from Athens, organic loan growth is 13.2% over 1Q18. C&I and Owner Occupied CRE make up 45% of loan book. With the closing of Athens Federal acquisition, we have diversified our loan book. *Annualized % change from 4Q18 to 1Q19       1Q19 Change Vs. 4Q18* Change Vs. 1Q18 $ in millions $ $ % $ % Balance Sheet (EOP Balances) Commercial and Industrial $ 420 $ 15 15.4% $ 12 2.8% Commercial Real Estate 574 24 17.4% 184 47.3% Consumer Real Estate 249 (5) -7.4% 145 138.9% Construction and Land Development 162 (12) -28.9% 70 76.4% Consumer 26 1 9.9% 17 175.5% Other 36 16 301.2% 8 29.4% Total Loans HFI $ 1,468 $ 38 10.8% $ 436 42.3%

Credit Quality The current reserve of $13MM plus the $4.8MM fair value mark on acquired loans would equate to a 1.21% reserve/loans. The reserve is directionally aligned with the improvement in credit quality and attributes of our criticized and classified loans. Current NPAs/Assets are at a low level.

Our profitability roadmap is dependent on expanding existing relationships and acquiring new relationships. With loans typically leading the relationship, a full relationship typically consists of the following: Operating account (DDA or NOW) Treasury Management Loan Relationship banking is key to building wallet share with current customer base. We continue to build full relationships 1Q19 Annualized

Loan Yields The yield on new loan production in 1Q19 was 5.60%; the last 2 quarters of new loan production yields are above our portfolio average. New loan production yields have increased 173 bps from 1Q17. Loan fees decreased as we experienced larger than normal amount of payoffs in 4Q18. Yield curve lower in 1Q19 vs 4Q18; US Treasury Yields at 2,5,7 year points lower by 21 bps, 28 bps, 28 bps respectively. Loan Yield Rollforward 4Q18 (Avg) 5.49% Repricing of Variable Rate Loans 0.05% Loan Volume/Mix 0.05% Decrease in Loan Fees (0.10%) 1Q19 (Avg) 5.49%

Deposit Growth and Costs EOP Deposits grew 28.1% on an annualized basis from 4Q18. Excluding Day 1 deposits from Athens, organic deposit growth was 11.5% vs. 1Q18. Deposit costs increased 19 bps to 1.31% reflecting increased competition for deposits. 46% of all deposits are in a checking account (DDA and NOW). Fed Funds 1.25% Fed Funds 1.50% Fed Funds 1.75% Fed Funds 2.00% Fed Funds 2.25% *Annualized % change from 4Q18 to 1Q19       1Q19 Change Vs. 4Q18* Change Vs. 1Q18 $ in millions $ $ % $ % Balance Sheet (EOP Balances) Non-Interest Bearing $ 313 $ 23 32.3% $ 54 21.1% Interest Checking (NOW) 450 16 14.5% 155 52.4% Savings & Money Market 493 (4) -3.7% 89 22.2% Time Deposit's under $100K 120 36 176.8% 84 230.2% Time Deposit's over $100K 303 38 58.6% 169 125.6% Deposits $ 1,679 $ 109 28.1% $ 551 48.9%

Net Interest Margin(1) Our NIM was 3.75% and decreased 14 bps due to: Loan volumes and pricing contributed 10 bps. Decrease of 6 bps in loan fees (C&I and CRE). Higher deposit costs lowered NIM 18 bps. EOP loan to deposit ratio at 96.2% (incl HFS). Net Interest Margin     4Q18 (Avg) 3.89% Loan Volumes/Pricing 0.10% Decrease in Loan Fees (0.06%) Increase in Deposit Costs (0.18%) 1Q19 (Avg) 3.75% Calculated on a tax equivalent basis

Non-Interest Income Treasury Management and Deposit Service Charges reflect addition of Athens customer base. Record Tri-Net fees of $641K. Mortgage flat to prior year and prior quarter. Mortgage origination volume was 71% purchase volume.   Three Months Ended (Dollars in thousands) March 31, December 31, September 30, June 30, March 31, 2019 2018 2018 2018 2018 Non-Interest Income  Treasury Management and Other Deposit Service Charges $ 798 $ 793 $ 528 $ 427 $ 402 Net Gain (Loss) on Sale of Securities 12 1 (1) 3 - Tri-Net Fees 641 276 374 325 528 Mortgage Banking Income 1,385 1,324 1,634 1,383 1,313 Other 1,899 3,993 683 627 847 Total Non-Interest Income $ 4,735 $ 6,387 $ 3,218 $ 2,765 $ 3,090 Average Assets 1,988,478 1,940,991 1,421,873 1,396,359 1,351,129 Non-Interest Income / Average Assets 0.97% 1.31% 0.90% 0.79% 0.93%    Non-interest Income was 0.97% of Average Assets with record TriNet Loans Sales

Non-Interest Expense .42 Three Months Ended (Dollars in thousands) March 31, December 31, September 30, June 31, March 31, 2019 2018 2018 2018 2018 Non-Interest Expense  Salaries and Employee Benefits $ 8,432 $ 9,475 $ 6,514 $ 6,340 $ 6,257 Data Processing & Software 1,474 1,424 803 810 798 Professional Fees 543 534 255 344 474 Occupancy 883 736 544 535 521 Equipment 852 810 520 602 539 Regulatory Fees 274 364 228 233 203 Merger-Related Charges 594 8,929 540 335 - Amortization of Intangibles 430 442 3 10 10 Other Operating 1,243 1,120 663 796 778 Total Non-Interest Expense $ 14,725 $ 23,832 $ 10,070 $ 10,005 $ 9,580 Efficiency Ratio 67.74% 98.88% 68.22% 69.71% 68.74% Average Assets $ 1,988,478 $ 1,940,991 $ 1,421,873 $ 1,396,359 $ 1,351,129 Non-Interest Expense / Average Assets 3.00% 4.87% 2.81% 2.87% 2.88% FTE 289 286 185 183 182    Operating Non-Interest Expense(1) $ 14,131 $ 14,903 $ 9,530 $ 9,670 $ 9,580 Operating Efficiency Ratio(1) 65.01% 61.83% 64.56% 67.38% 68.74% Operating Non-Interest Expense/ Average Assets(1) 2.88% 3.05% 2.66% 2.78% 2.88% Operating Efficiency Ratio of 65.0% was in line with previously provided guidance (1) Operating results are non-GAAP financial measures that adjust GAAP reported net income and other metrics for certain income and expense items as outlined in the non-GAAP reconciliation calculations, using a blended statutory income tax rate of 26.14% excluding one-time merger-related items. See the Appendix to this presentation for reconciliation and discussion of Non-GAAP metrics.            

CapStar continues to move forward with the integration of Athens Key Milestones June 11, 2018 – Announcement of transaction August 29, 2018 – Shareholder approvals obtained September 12, 2018 – Regulatory approvals obtained October 1, 2018 – Merger closed April 5-7, 2019 – Branding and Core operating systems conversion completed Second Half 2019 – Expected Synergies on track to be realized Athens Merger update

Our capital ratios are above regulatory guidelines. Repurchased 155,400 CSTR shares in 1Q19 at an average price of $15.62 per share. *Reconciliation provided in non-GAAP tables in the Appendix at the end of this presentation. Capital Ratios 1Q19   4Q18   3Q18   2Q18   "Well Capitalized" Guidelines                     Tangible Equity / Tangible Assets* 10.76%   10.86%   10.72%   10.53%   NA Tangible Common Equity / Tangible Assets* 10.31%   10.39%   10.09%   9.89%   NA Tier 1 Leverage Ratio 10.97%   11.06%   11.02%   10.87%   ≥ 5.00% Tier 1 Risk Based Capital Ratio 11.90%   12.13%   11.49%   11.41%   ≥ 8.00% Total Risk Based Capital Ratio 12.64%   12.84%   12.62%   12.53%   ≥ 10.00% Draft Capital

The following chart summarizes our 1Q19 performance relative to previously issued guidance: Guidance Metric Proforma 1Q19 Performance Net Interest Margin 3.70% - 3.90% Efficiency Ratio Mid/Low 60’s% near term Non-Interest Income/Average Assets 0.80% - 1.10% ROAA 1.15% - 1.35% X Loan/Deposit Ratio 90% – 100% Loan Growth High Single to Low Double Digits Net Charge Off Ratio <25 bps Purchase Accounting Accretion ~$1MM (2019) On track CDI $1.7MM (2019) On track Effective Tax Rate ~23%

CapStar’s strategy remains one of sound, profitable growth. Focused on Athens integration and capturing expected synergies. Focused on increasing primary bank status with more clients. Organic growth opportunities through market share takeaway. Continue to explore strategic and opportunistic M&A. Key Takeaways* *Refer to “Safe Harbor Statements” on slide 3

Appendix: Historical Financials

* Reconciliation provided in non-GAAP tables in this Appendix. See also “Non-GAAP Disclaimer” on slide 2.   Three Months Ended Twelve Months Ended December 31, March 31, (Dollars in thousands, except per share information) 2019 2018 2018 2017 2016 2015 2014 STATEMENT OF INCOME DATA  Interest Income $ 22,967 $ 13,744 $ 67,781 $ 51,515 $ 45,395 $ 40,504 $ 38,287 Interest Expense 5,965 2,898 16,088 9,651 6,932 5,731 5,871 Net Interest Income 17,002 10,846 51,692 41,863 38,463 34,773 32,416 Provision for Loan and Lease Losses 886 678 2,842 12,870 2,829 1,651 3,869 Non-Interest Income 4,735 3,090 15,459 10,908 11,084 8,884 7,419 Non-Interest Expense 14,725 9,580 53,487 33,765 33,129 30,977 28,562 Income before Income Taxes 6,126 3,678 10,821 6,136 13,590 11,029 7,404 Income Tax Expense 1,346 483 1,167 4,635 4,493 3,470 2,412 Net Income 4,780 3,195 9,655 1,501 9,097 7,559 4,992 Pre-Tax Pre-Provision Net Income * 7,011 4,355 13,663 19,006 16,419 12,680 11,273 Draft Historical Financials

  Three Months Ended March 31, Twelve Months Ended December 31, (Dollars in thousands, except per share information) 2019 2018 2018 2017 2016 2015 BALANCE SHEET (AT PERIOD END)  Cash & Due From Banks $ 120,321 $ 51,125 $ 105,443 $ 82,797 $ 80,111 $ 100,185 Investment Securities 251,563 202,141 259,580 205,186 235,250 221,890 Loans Held for Sale 72,870 62,286 57,618 74,093 42,111 35,729 Gross Loans and Leases (Net of Unearned Income) 1,467,786 1,031,821 1,429,794 947,537 935,251 808,396 Total Intangibles 45,618 6,232 46,048 6,242 6,290 6,344 Total Assets 2,035,811 1,382,745 1,963,883 1,344,429 1,333,675 1,206,800 Deposits 1,678,802 1,127,553 1,570,008 1,119,866 1,128,722 1,038,460 Borrowings and Repurchase Agreements 75,660 100,000 126,509 70,000 55,000 48,755 Total Liabilities 1,776,060 1,234,052 1,709,504 1,197,483 1,194,468 1,098,214 Common Equity 250,750 139,693 245,379 137,946 130,207 92,086 Preferred Equity 9,000 9,000 9,000 9,000 9,000 16,500 Total Shareholders' Equity 259,751 148,693 254,379 146,946 139,207 108,586 Total Liabilities and Shareholders’ Equity 2,035,811 1,382,745 1,963,883 1,344,429 1,333,675 1,206,800 Draft Historical Financials

Historical Financials (1) Reconciliation provided in non-GAAP tables in this Appendix. See also “Non-GAAP Disclaimer” on slide 2. (2) Calculated on a tax equivalent basis (3) Efficiency ratio is non-interest expense divided by the sum of net interest income and non-interest income.   Three Months Ended Twelve Months Ended December 31, March 31, (Dollars in thousands, except per share information) 2019 2018 2018 2017 2016 2015 2014 SELECTED PERFORMANCE RATIOS  Return on Average Assets (ROAA) 0.97% 0.96% 0.63% 0.11% 0.72% 0.66% 0.47% Pre-Tax Pre-Provision Return on Average Assets (PTPP ROAA) (1) 1.43% 1.31% 0.89% 1.40% 1.30% 1.11% 1.06% Return on Average Equity (ROAE) 7.54% 8.74% 5.50% 1.05% 7.57% 7.08% 4.94% Return on Average Tangible Equity (ROATE) (1) 9.18% 9.12% 6.05% 1.09% 7.99% 7.53% 5.30% Return on Average Tangible Common Equity (ROATCE) (1) 9.59% 9.74% 6.41% 1.17% 9.16% 9.01% 6.43% Net Interest Margin(2) (tax equivalent basis) 3.75% 3.39% 3.55% 3.25% 3.22% 3.24% 3.25% Efficiency Ratio(3) 67.74% 68.74% 79.65% 63.9% 66.9% 70.9% 71.7% Non-Interest Income / Average Assets 0.97% 0.93% 1.01% 0.80% 0.88% 0.78% 0.70% Non-Interest Expense / Average Assets 3.00% 2.88% 3.50% 2.49% 2.62% 2.72% 2.68% Loan and Lease Yield 5.49% 4.74% 5.11% 4.41% 4.33% 4.53% 4.74% Deposit Cost 1.31% 0.88% 1.09% 0.73% 0.59% 0.56% 0.62%

* Reconciliation provided in non-GAAP tables in this Appendix. See also “Non-GAAP Disclaimer” on slide 2.   Three Months Ended Twelve Months Ended December 31, March 31, (Dollars in thousands, except per share information) 2019 2018 2018 2017 2016 2015 2014 PER SHARE OUSTANDING DATA  Basic Net Earnings per Share $0.27 $0.27 $0.73 $0.13 $0.98 $0.90 $0.59 Diluted Net Earnings per Share $0.25 $0.25 $0.67 $0.12 $0.81 $0.73 $0.49 Book Value Per Share, Reported $14.11 $11.87 $13.84 $11.91 $11.62 $10.74 $10.17 Tangible Book Value Per Share, Reported* $11.55 $11.34 $11.25 $11.37 $11.06 $10.00 $9.41 Shares of Common Stock Outstanding at End of Period 17,765,124 11,773,358 17,724,721 11,582,026 11,204,515 8,577,051 8,471,516 CAPITAL RATIOS (AT PERIOD END)  Tier 1 Leverage Ratio 10.97% 10.91% 11.06% 10.77% 10.46% 9.33% 8.56% Common Equity Tier 1 Capital (Cet1) 11.40% 10.43% 11.61% 10.70% 10.90% 8.89% - Tier 1 Risk-Based Capital 11.90% 11.11% 12.13% 11.41% 11.61% 10.41% 10.32% Total Risk-Based Capital Ratio 12.64% 12.22% 12.84% 12.52% 12.60% 11.42% 11.54% Total Shareholders' Equity to Total Assets Ratio 12.76% 10.75% 12.95% 10.93% 10.44% 9.00% 9.10% Tangible Equity to Tangible Assets * 10.76% 10.35% 10.86% 10.51% 10.01% 8.52% 8.58% Draft Historical Financials

Historical Financials   Three Months Ended Twelve Months Ended December 31, March 31, (Dollars in thousands, except per share information) 2019 2018 2018 2017 2016 2015 2014 NON-PERFORMING ASSETS (NPA)  Non-Performing Loans $ 1,712 $ 1,329 $ 2,078 $ 2,695 $ 3,619 $ 2,689 $ 7,738 Troubled Debt Restructurings 1,255 1,190 1,391 1,206 1,272 125 2,618 Other Real Estate and Repossessed Assets 1,038 - 988 - - 216 575 Non-Performing Assets 2,750 1,329 3,066 2,695 3,619 2,905 8,313 ASSET QUALITY RATIOS  Non-Performing Assets / Assets 0.14% 0.10% 0.16% 0.20% 0.27% 0.24% 0.74% Net Charge-Offs to Average Loans (Periods Annualized) 0.01% -0.07% 0.39% 1.09% 0.15% 0.38% 0.15% Allowance for Loan Losses to Total Loans and Leases 0.88% 1.41% 0.85% 1.45% 1.24% 1.25% 1.58% Allowance for Loan to Non-Performing Loans 756.9% 1095.7% 582.8% 509.1% 321.4% 376.8% 145.8%

Historical Financials   As of March 31, As of December 31, (Dollars in thousands, except per share information) 2019 2018 2018 2017 2016 2015 COMPOSITION OF LOANS HELD FOR INVESTMENT  Commercial Real Estate $ 574,001 $ 389,757 $ 550,446 $ 350,622 $ 302,322 $ 251,196 Consumer Real Estate 248,943 104,224 253,562 102,581 97,015 93,785 Construction and Land Development 162,237 91,953 174,670 82,586 94,491 52,522 Commercial and Industrial 419,941 408,353 404,600 373,248 379,620 353,442 Consumer 26,241 9,524 25,615 6,862 5,974 8,668 Other Loans 36,424 28,010 20,902 31,638 55,829 48,782 DEPOSIT COMPOSITION  Non-Interest Bearing $ 312,597 $ 258,161 $ 289,552 $ 301,742 $ 197,788 $ 190,580 Interest Checking 450,462 295,495 434,921 274,681 299,621 189,983 Savings & Money Market 492,619 403,216 497,108 367,245 447,686 437,214 Time Deposits 423,125 170,682 348,427 176,197 183,628 220,683

Historical Financials Three Months Ended Twelve Months Ended December 31, March 31, (Dollars in thousands, except per share information) 2019 2018 2018 2017 2016 2015 2014 REAL ESTATE - COMMERCIAL AND CONSTRUCTION CONCENTRATIONS  Construction and Development $ 162,237 $ 91,953 $ 174,670 $ 82,586 $ 94,491 $ 52,522 $ 46,193 Commercial Real Estate and Construction 615,943 395,398 608,529 382,300 282,513 198,285 172,803 Construction and Development to Total Risk Based Capital (Reg. 100%) 71.7% 56.9% 78.7% 52.9% 63.2% 45.3% 42.8% Coml. Real Estate and Const. to Total Risk Based Capital (Reg. 300%) 272.3% 244.5% 274.1% 244.8% 188.8% 170.9% 160.0% MORTGAGE METRICS  Total Origination Volume $ 73,791 $ 91,996 $ 406,751 $ 440,132 $ 522,037 $ 422,323 $ 253,099 Total Mortgage Loans Sold 83,996 97,162 407,795 462,506 523,031 407,941 245,891 Purchase Volume as a % of Originations 71% 71% 81% 77%  67% 72% 76% Mortgage Fees/Gain on Sale of Loans 1,385 1,313 5,653 6,238 7,375 5,962 4,067 Mortgage Fees/Gain on Sale as a % of Loans Sold 1.65% 1.35% 1.39% 1.35% 1.41% 1.46% 1.65% Mortgage Fees/Gain on Sale as a % of Total Revenue 6.4% 9.4% 8.4% 11.8% 14.9% 13.7% 10.2%

  Three Months Ended March 31, Twelve Months Ended December 31, (Dollars in thousands, except per share information) 2019 2018 2018 2017 2016 2015 2014 PRE-TAX PRE-PROVISION INCOME Pre-Tax Income $ 6,126 $ 3,678 $ 10,821 $ 6,136 $ 13,590 $ 11,029 $ 7,404 Add: Provision for Loan Losses 886 678 2,842 12,870 2,829 1,651 3,869 Pre-Tax Pre-Provision Income 7,011 4,355 13,663 19,006 16,419 12,680 11,273 PRE-TAX PRE-PROVISION RETURN ON AVERAGE ASSETS Total Average Assets $ 1,988,478 $ 1,351,129 $ 1,528,915 $ 1,357,794 $ 1,262,763 $ 1,140,760 $ 1,064,705 Pre-Tax Pre-Provision Income 7,011 4,355 13,663 19,006 16,419 12,680 11,273 Pre-Tax Pre-Provision Return on Average Assets 1.43% 1.31% 0.89% 1.40% 1.30% 1.11% 1.06% Non-GAAP Financial Measures

  As of March 31, As of December 31, (Dollars in thousands, except per share information) 2019 2018 2018 2017 2016 2015 TANGIBLE EQUITY Total Shareholders’ Equity $ 259,751 $ 148,693 $ 254,379 $ 146,946 $ 139,207 $ 108,586 Less: Intangible Assets 45,618 6,232 46,048 6,242 6,290 6,344 Tangible Equity 214,133 142,461 208,331 140,704 132,918 102,242 TANGIBLE COMMON EQUITY Tangible Equity $ 214,133 $ 142,461 $ 208,331 $ 140,704 $ 132,918 $ 102,242 Less: Preferred Equity 9,000 9,000 9,000 9,000 9,000 16,500 Tangible Common Equity 205,133 133,461 199,331 131,704 123,918 85,742 TANGIBLE EQUITY TO TANGIBLE ASSETS Tangible Equity $ 214,133 $ 142,461 $ 208,331 $ 140,704 $ 132,918 $ 102,242 Total Assets 2,035,811 1,382,745 1,963,883 1,344,429 1,333,675 1,206,800 Less: Intangible Assets 45,618 6,238 46,048 6,242 6,290 6,344 Tangible Assets 1,990,193 1,376,507 1,917,835 1,338,188 1,327,385 1,200,456 Tangible Equity to Tangible Assets 10.76% 10.35% 10.86% 10.51% 10.01% 8.52% TANGIBLE COMMON EQUITY TO TANGIBLE ASSETS Tangible Common Equity $ 205,133 $ 133,461 $ 199,331 $ 131,704 $ 123,918 $ 85,742 Tangible Assets 1,990,193 1,376,507 1,917,835 1,338,188 1,327,385 1,200,456 Tangible Common Equity to Tangible Assets 10.31% 9.70% 10.39% 9.84% 9.34% 7.14% Non-GAAP Financial Measures

  Three Months Ended March 31, Twelve Months Ended December 31, (Dollars in thousands, except per share information) 2019 2018 2018 2017 2016 2015 2014 RETURN ON AVERAGE TANGIBLE EQUITY (ROATE) Total Average Shareholder’s Equity $ 257,105 $ 148,276 $ 175,686 $ 143,402 $ 120,123 $ 106,727  $ 101,030 Less: Average Intangible Assets 45,890 6,238 16,174 6,265 6,318 6,371 6,855 Average Tangible Equity 211,215 142,038 159,512 137,137 113,805 100,356 94,175 Net Income to Shareholders 4,780 3,195 9,655 1,501 9,097 7,559 4,992 Return on Average Tangible Equity (ROATE) 9.18% 9.12% 6.05% 1.09% 7.99% 7.53% 5.30% RETURN ON AVERAGE TANGIBLE COMMON EQUITY (ROATCE) Average Tangible Equity $ 211,215 $ 142,038 $ 159,512 $ 137,137 $ 113,805 $ 100,356 $ 94,175 Less: Preferred Equity 9,000 9,000 9,000 9,000 14,533 16,500 16,500 Average Tangible Common Equity 202,215 133,037 150,512 128,137 99,273 83,856 77,675 Net Income to Shareholders 4,780 3,195 9,655 1,501 9,097 7,559 4,992 Return on Average Tangible Common Equity (ROATCE) 9.59% 9.74% 6.41% 1.17% 9.16% 9.01% 6.43% Non-GAAP Financial Measures

  As of March 31, As of December 31, (Dollars in thousands, except per share information) 2019 2018 2018 2017 2016 2015 TANGIBLE BOOK VALUE PER SHARE, REPORTED Tangible Common Equity $ 205,133 $ 133,461 $ 199,331 $ 131,704 $ 123,918 $ 85,742 Shares of Common Stock Outstanding 17,765,124 11,773,358 17,724,721 11,582,026 11,204,515 8,577,051 Tangible Book Value Per Share, Reported $11.55 $11.34 $11.25 $11.37 $11.06 $10.00 SHARES OUTSTANDING AT END OF PERIOD Shares of Common Stock Outstanding 17,765,124 11,773,358 17,724,721 11,582,026 11,204,515 8,577,051 Shares of Preferred Stock Outstanding 878,048 878,049 878,048 878,049 878,049 1,609,756 Total Shares Outstanding at End of Period 18,643,170 12,651,407 18,602,769 12,460,075 12,082,564 10,186,807 TANGIBLE BOOK VALUE PER SHARE, ADJUSTED Tangible Equity $ 214,133 $ 142,461 $ 208,331 $ 140,704 $ 132,918 $ 102,242 Total Shares Outstanding at End of Period 18,643,172 12,651,407 18,602,769 12,460,075 12,082,564 10,186,807 Tangible Book Value Per Share, Adjusted $11.49 $11.26 $11.20 $11.29 $11.00 $10.04 Non-GAAP Financial Measures

  Three Months Ended March 31, Twelve Months Ended December 31, (Dollars in thousands, except per share information) 2019 2018 2018 2017 2016 2015 2014 OPERATING NET INCOME Net Income $ 4,780 $ 3,195 $ 9,655 $ 1,501 $ 9,097 $ 7,559 $ 4,992 Add: Merger-Related Expense 594 - 9,803 - - - - Less: Income Tax Impact (155) - (2,213) 3,562 - - - Operating Net Income 5,219 3,195 17,245 5,063 9,097 7,559 4,992 OPERATING DILUTED NET INCOME PER SHARE Operating Net Income $ 5,219 $ 3,195 $ 17,245 $ 5,063 $ 9,097 $ 7,559 $ 4,992 Average Diluted Shares Outstanding 18,830,933 12,975,759 14,480,347 12,803,511 11,212,026 10,381,895 10,281,044 Operating Diluted Net Income per Share $0.28 $0.25 $1.19 $0.40 $0.81 $0.73 $0.49 OPERATING RETURN ON AVERAGE ASSETS (ROAA) Operating Net Income $ 5,219 $ 3,195 $ 17,245 $ 5,063 $ 9,097 $ 7,559 $ 4,992 Total Average Assets 1,988,478 1,351,129 1,528,915 1,357,794 1,262,763 1,140,760 1,064,705 Operating Return on Average Assets (ROAA) 1.06% 0.96% 1.13% 0.37% 0.72% 0.66% 0.47% OPERATING RETURN ON AVERAGE TANGIBLE EQUITY (ROATE) Average Tangible Equity $ 211,215 $ 142,038 $ 159,512 $ 137,137 $ 113,805 $ 100,356 $ 94,175 Operating Net Income 5,219 3,195 17,245 5,063 9,097 7,559 4,992 Operating Return on Average Tangible Equity (ROATE) 10.02% 9.12% 10.81% 3.69% 7.99% 7.53% 5.30% Non-GAAP Financial Measures The operating non-GAAP amounts and ratios above have excluded the impact of the merger-related items and the impact of the Tax Cuts and Jobs Act of 2017.

  Three Months Ended March 31, Twelve Months Ended December 31, (Dollars in thousands, except per share information) 2019 2018 2018 2017 2016 2015 2014 OPERATING NON-INTEREST EXPENSE Non-Interest Expense $ 14,725 $ 9,580 $ 53,487 $ 33,765 $ 33,129 $ 30,977 $ 28,562 Less: Merger-Related Expense (594) - (9,803) - - - - Operating Non-Interest Expense 14,131 9,580 43,684 33,765 33,129 30,977 28,562 OPERATING NON-INTEREST EXPENSE / AVERAGE ASSETS Operating Non-Interest Expense $ 14,131 $ 9,580 $ 43,684 $ 33,765 $ 33,129 $ 30,977 $ 28,562 Total Average Assets 1,988,478 1,351,129 1,528,915 1,357,794 1,262,763 1,140,760 1,064,705 Operating Non-Interest Income / Average Assets 2.88% 2.88% 2.86% 2.49% 2.62% 2.72% 2.68% OPERATING EFFICIENCY RATIO Operating Non-Interest Expense $ 14,131 $ 9,580 $ 43,684 $ 33,765 $ 33,129 $ 30,977 $ 28,562 Net Interest Income 17,002 10,846 51,692 41,863 38,463 34,773 32,416 Non Interest Income 4,735 3,090 15,459 10,908 11,084 8,884 7,419 Total Revenues 21,737 13,936 67,151 52,771 49,548 43,657 39,835 Operating Efficiency Ratio 65.01% 68.74% 65.05% 63.98% 66.86% 70.96% 71.70% Non-GAAP Financial Measures The operating non-GAAP amounts and ratios above have excluded the impact of the merger-related items.

CapStar Financial Holdings, Inc. 1201 Demonbreun Street, Suite 700 Nashville, TN 37203 Mail: P.O. Box 305065 Nashville, TN 37230-5065 (615) 732-6400 Telephone www.capstarbank.com (615) 732-6455 Email: ir@capstarbank.com Contact Information Investor Relations Executive Leadership Claire W. Tucker President and Chief Executive Officer CapStar Financial Holdings, Inc. (615) 732-6402 Email: ctucker@capstarbank.com Rob Anderson Chief Financial and Administrative Officer CapStar Financial Holdings, Inc. (615) 732-6470 Email: randerson@capstarbank.com Corporate Headquarters