PROSPERITY BANCSHARES, INC.® REPORTS FOURTH QUARTER 2024 EARNINGS
- Fourth quarter earnings per share (diluted) of $1.37, an increase of 34.3% compared to fourth quarter 2023
- Fourth quarter net income of $130.1 million
- Fourth quarter net interest margin increased 30 basis points to 3.05% compared to fourth quarter 2023
- Noninterest-bearing deposits of $9.8 billion, representing 34.5% of total deposits
- Borrowings decreased $700.0 million during fourth quarter 2024
- Allowance for credit losses on loans and on off-balance sheet credit exposure of $389.5 million and allowance for credit losses on loans to total loans, excluding Warehouse Purchase Program, of 1.67%(1)
- Nonperforming assets remain low at 0.23% of fourth quarter average interest-earning assets
- Return (annualized) on fourth quarter average assets of 1.31%, average common equity of 7.00% and average tangible common equity of 13.50%(1)
- Approved 2025 Stock Repurchase Program covering up to 5% of outstanding common stock
- Prosperity Bank named Best Overall Bank in Texas by Money for 2025
HOUSTON, Jan. 29, 2025 /PRNewswire/ -- Prosperity Bancshares, Inc.® (NYSE: PB), the parent company of Prosperity Bank® (collectively, "Prosperity"), reported net income of $130.1 million for the quarter ended December 31, 2024 compared with $95.5 million for the same period in 2023. Net income per diluted common share was $1.37 for the quarter ended December 31, 2024 compared with $1.02 for the same period in 2023. The annualized return on fourth quarter average assets was 1.31%. Additionally, deposits increased $293.7 million and borrowings decreased $700.0 million during the fourth quarter of 2024. Nonperforming assets decreased $8.4 million during the fourth quarter of 2024 and remain low at 0.23% of fourth quarter average interest-earning assets. On April 1, 2024, Lone Star State Bancshares, Inc. ("Lone Star") merged with Prosperity Bancshares and Lone Star State Bank of West Texas ("Lone Star Bank") merged with Prosperity Bank (collectively, the "Merger").
"We are excited about the growth and future of our company. The Texas and Oklahoma economies are some of the best in the country. Texas has no state income tax and both Texas and Oklahoma have a business-friendly political climate. The Texas population grew more than any other state in 2024, with the addition of 563,000 people, bringing the total population to 31,290,831. Further, according to Forbes in July 2024, there have been 209 corporate relocations to Texas since 2018. All of this bodes well for our future growth," said David Zalman, Prosperity's Senior Chairman and Chief Executive Officer.
"Prosperity has a strong capital position that provides opportunities to participate in mergers and acquisitions, repurchase stock or fund organic growth without the need for additional capital. We believe that our net interest margin should continue to expand to a more normal ratio as our assets continue to reprice, thereby increasing our earnings per share. We also have strong core deposits, with 34.5% of our deposits in noninterest-bearing accounts," stated Zalman.
"I would like to thank all our customers, associates, directors, and shareholders for helping build such a successful bank," concluded Zalman.
Results of Operations for the Three Months Ended December 31, 2024
Net income was $130.1 million(2) for the three months ended December 31, 2024 compared with $95.5 million(3) for the same period in 2023, an increase of $34.6 million or 36.2%. Net income per diluted common share was $1.37 for the three months ended December 31, 2024 compared with $1.02 for the same period in 2023, an increase of 34.3%. The changes were primarily due to an increase in net interest income and a decrease in the Federal Deposit Insurance Corporation ("FDIC") special assessment, partially offset by an increase in salaries and benefits. On a linked quarter basis, net income was $130.1 million(2) for the three months ended December 31, 2024 compared with $127.3 million(4) for the three months ended September 30, 2024, an increase of $2.8 million or 2.2%. Net income per diluted common share was $1.37 for the three months ended December 31, 2024 compared with $1.34 for the three months ended September 30, 2024. Annualized returns on average assets, average common equity and average tangible common equity for the three months ended December 31, 2024 were 1.31%, 7.00% and 13.50%(1), respectively. Prosperity's efficiency ratio (excluding net gains and losses on the sale, write-down or write-up of assets and securities) was 46.10%(1) for the three months ended December 31, 2024.
Net interest income before provision for credit losses was $267.8 million for the three months ended December 31, 2024 compared with $237.0 million for the same period in 2023, an increase of $30.8 million or 13.0%. The change was primarily due to an increase in the average balances and average rates on loans, an increase in the average balances on federal funds sold and other earning assets and a decrease in the average balances and rates on other borrowings, partially offset by a decrease in the average balances on investment securities and an increase in the average balances and rates on interest-bearing deposits. Net interest income before provision for credit losses increased $6.1 million or 2.3% to $267.8 million for the three months ended December 31, 2024 compared with $261.7 million for the three months ended September 30, 2024. The change was primarily due to a decrease in the average balances on other borrowings and a decrease in the average rates on interest-bearing deposits, partially offset by a decrease in the average balances and average rates on loans and a decrease in the average balances on investment securities.
The net interest margin on a tax equivalent basis was 3.05% for the three months ended December 31, 2024 compared with 2.75% for the same period in 2023. The change was primarily due to an increase in the average balances and average rates on loans and a decrease in the average balances and rate on other borrowings, partially offset by a decrease in the average balances on investment securities and an increase in the average balances and rates on interest-bearing deposits. The net interest margin on a tax equivalent basis was 3.05% for the three months ended December 31, 2024 compared with 2.95% for the three months ended September 30, 2024. The change was primarily due to a decrease in the average balances on other borrowings and a decrease in the average rates on interest-bearing deposits, partially offset by a decrease in the average balances and average rates on loans and a decrease in the average balances on investment securities.
Noninterest income was $39.8 million for the three months ended December 31, 2024 compared with $36.6 million for the same period in 2023, an increase of $3.3 million or 8.9%. The change was primarily due to an increase in nonsufficient funds ("NSF") fees, an increase in service charges on deposit accounts and an increase in the net gain (loss) on sale or write-down of assets. Noninterest income was $39.8 million for the three months ended December 31, 2024 compared with $41.1 million for the three months ended September 30, 2024, a decrease of $1.3 million or 3.1%.
Noninterest expense was $141.5 million for the three months ended December 31, 2024 compared with $152.2 million for the same period in 2023, a decrease of $10.6 million or 7.0%, primarily due to a decrease in the FDIC special assessment, partially offset by an increase in salaries and benefits and an increase in credit and debit card, data processing and software amortization. Noninterest expense was $141.5 million for the three months ended December 31, 2024 compared with $140.3 million for the three months ended September 30, 2024, an increase of $1.2 million or 0.9%.
Results of Operations for the Year Ended December 31, 2024
Net income was $479.4 million(5) for the year ended December 31, 2024 compared with $419.3 million(6) for the same period in 2023, an increase of $60.1 million or 14.3%. Net income per diluted common share was $5.05 for the year ended December 31, 2024 compared with $4.51 for the same period in 2023, an increase of 12.0%. Net income and net income per diluted common share for the year ended December 31, 2024 were impacted by an increase in net interest income, a decrease in the FDIC special assessment of $16.3 million, a gain on Visa Class B-1 stock exchange net of investment securities sales of $11.2 million, a decrease in merger related provision for credit losses of $9.5 million and a decrease in merger related expenses of $10.7 million, and increases in noninterest income and noninterest expense related to nine months of Lone Star Bank operations. Returns on average assets, average common equity and average tangible common equity for the year ended December 31, 2024 were 1.21%, 6.56% and 12.73%(1), respectively.
Excluding merger related provision and expenses, gain on Visa Class B-1 stock exchange net of investment securities sales, and FDIC special assessment, each net of tax, net income was $484.0 million(1) or $5.11(1) per diluted common share for the year ended December 31, 2024, and annualized returns on average assets, average common equity and average tangible common equity for the same period were 1.22%(1), 6.63%(1) and 12.85%(1), respectively. Prosperity's efficiency ratio was 48.43%(1) for the year ended December 31, 2024; and excluding merger related expenses and FDIC special assessment, the efficiency ratio was 47.75%(1).
Net interest income before provision for credit losses for the year ended December 31, 2024 was $1.026 billion compared with $956.4 million for the same period in 2023, an increase of $70.1 million or 7.3%. The change was primarily due to an increase in the average balances and average rates on loans, an increase in the average balances and average rates on federal funds sold and other earning assets, an increase in loan discount accretion of $9.4 million and a decrease in the average balance and rates on other borrowings, partially offset by a decrease in the average balances on investment securities and an increase in the average balances and rates on interest-bearing deposits.
The net interest margin on a tax equivalent basis for the year ended December 31, 2024 was 2.93% compared with 2.78% for the same period in 2023. The change was primarily due to an increase in the average balances and average rates on loans, an increase in the average balances and average rates on federal funds sold and other earning assets, an increase in loan discount accretion of $9.4 million and a decrease in the average balance and rates on other borrowings, partially offset by a decrease in the average balances on investment securities and an increase in the average balances and rates on interest-bearing deposits.
Noninterest income was $165.8 million for the year ended December 31, 2024 compared with $153.3 million for the same period in 2023, an increase of $12.5 million or 8.2%, primarily due to a gain on Visa Class B-1 stock exchange net of investment securities sales of $11.2 million and increases in service charges on deposit accounts, partially offset by a decrease in other noninterest income.
Noninterest expense was $570.6 million for the year ended December 31, 2024 compared with $556.7 million for the same period in 2023, an increase of $13.9 million or 2.5%, primarily due to an increase in salaries and benefits, an increase in credit and debit card, data processing and software amortization and additional expenses related to nine months of Lone Star Bank operations, partially offset by a decrease in the FDIC special assessment of $16.3 million and a decrease in merger related expenses of $10.7 million.
Balance Sheet Information
At December 31, 2024, Prosperity had $39.567 billion in total assets, an increase of $1.019 billion or 2.6%, compared with $38.548 billion at December 31, 2023. Linked quarter total assets decreased by $548.6 million compared with $40.115 billion at September 30, 2024.
Loans were $22.149 billion at December 31, 2024, an increase of $968.7 million or 4.6%, compared with $21.181 billion at December 31, 2023, primarily due to the Merger. Linked quarter loans decreased $231.6 million from $22.381 billion at September 30, 2024. Loans, excluding Warehouse Purchase Program loans, were $21.068 billion at December 31, 2024 compared with $20.358 billion at December 31, 2023, an increase of $710.0 million or 3.5%, and compared with $21.152 billion at September 30, 2024, a decrease of $83.8 million.
Deposits were $28.381 billion at December 31, 2024, an increase of $1.202 billion or 4.4%, compared with $27.180 billion at December 31, 2023, primarily due to the Merger. Linked quarter deposits increased $293.7 million or 1.0% (4.2% annualized) from $28.088 billion at September 30, 2024.
The table below provides detail on the impact of loans acquired and deposits assumed in the Merger:
Balance Sheet Data (at period end) | ||||||||||||||||||||
(In thousands) | ||||||||||||||||||||
Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | ||||||||||||||||
(Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | ||||||||||||||||
Loans acquired (including new production since acquisition date): | ||||||||||||||||||||
Lone Star Bank | $ | 1,057,618 | $ | 1,109,783 | $ | 1,084,559 | $ | — | $ | — | ||||||||||
Prosperity Bank | ||||||||||||||||||||
Warehouse Purchase Program loans | 1,080,903 | 1,228,706 | 1,081,403 | 864,924 | 822,245 | |||||||||||||||
All other loans | 20,010,688 | 20,042,363 | 20,154,853 | 20,400,323 | 20,358,293 | |||||||||||||||
Total loans | $ | 22,149,209 | $ | 22,380,852 | $ | 22,320,815 | $ | 21,265,247 | $ | 21,180,538 | ||||||||||
Deposits assumed (including new deposits since acquisition date): | ||||||||||||||||||||
Lone Star Bank | $ | 1,093,536 | $ | 1,136,216 | $ | 1,187,821 | $ | — | $ | — | ||||||||||
All other deposits | 27,287,802 | 26,951,395 | 26,745,265 | 27,175,518 | 27,179,809 | |||||||||||||||
Total deposits | $ | 28,381,338 | $ | 28,087,611 | $ | 27,933,086 | $ | 27,175,518 | $ | 27,179,809 | ||||||||||
Excluding loans acquired in the Merger and new production at the acquired banking centers since April 1, 2024, loans at December 31, 2024 decreased $88.9 million compared with December 31, 2023 and decreased $179.5 million compared with September 30, 2024.
Excluding deposits assumed in the Merger and new deposits generated at the acquired banking centers since April 1, 2024, deposits at December 31, 2024 increased by $108.0 million compared with December 31, 2023 and increased by $336.4 million compared with September 30, 2024.
Asset Quality
Nonperforming assets totaled $81.5 million or 0.23% of quarterly average interest-earning assets at December 31, 2024 compared with $72.7 million or 0.21% of quarterly average interest-earning assets at December 31, 2023 and $89.9 million or 0.25% of quarterly average interest-earning assets at September 30, 2024.
The allowance for credit losses on loans and off-balance sheet credit exposures was $389.5 million at December 31, 2024 compared with $368.9 million at December 31, 2023 and $392.0 million at September 30, 2024. There was no provision for credit losses for the three months ended December 31, 2024 and 2023, and a provision for credit losses of $9.1 million and $18.5 million for the years ended December 31, 2024 and 2023, respectively. As a result of the loans acquired in the Merger, the second quarter of 2024 included a $7.9 million provision for credit losses on loans and a $1.2 million provision for credit losses on off-balance sheet credit exposures.
The allowance for credit losses on loans was $351.8 million or 1.59% of total loans at December 31, 2024 compared with $332.4 million or 1.57% of total loans at December 31, 2023 and $354.4 million or 1.58% of total loans at September 30, 2024. Excluding Warehouse Purchase Program loans, the allowance for credit losses on loans to total loans was 1.67%(1) at December 31, 2024 compared with 1.63%(1) at December 31, 2023 and 1.68%(1) at September 30, 2024.
Net charge-offs were $2.6 million for the three months ended December 31, 2024 compared with net charge-offs of $19.1 million for the three months ended December 31, 2023 and net charge-offs of $5.5 million for the three months ended September 30, 2024. For the fourth quarter of 2024, $1.5 million of reserves on resolved purchased credit deteriorated ("PCD") loans without any related charge-offs were released to the general reserve.
Net charge-offs were $14.6 million for the year ended December 31, 2024 compared with $38.0 million for the year ended December 31, 2023. Net charge-offs for the year ended December 31, 2024 included $3.4 million related to resolved PCD loans, which had specific reserves that were allocated to the charge-offs. Additionally, reserves on PCD loans increased by $26.1 million due to Day One accounting for PCD loans at the time of the Merger. Further, $15.4 million of reserves on resolved PCD loans were released to the general reserve.
Visa Class B-1 Stock Exchange
During the second quarter 2024, Prosperity tendered all of its shares of Visa, Inc. ("Visa") Class B-1 common stock in exchange for a combination of Visa Class B-2 common stock and Visa Class C common stock, pursuant to the terms and subject to the conditions of the public offering of Visa to exchange its Class B-1 common stock for a combination of shares of its Class B-2 common stock and Class C common stock, which expired on May 3, 2024. Prosperity recorded an unrealized gain of $20.6 million during the second quarter 2024 based on the conversion privilege of the Class C common stock and the closing price of Visa Class A common stock. In the exchange, Prosperity received 48,492 shares of Class B-2 stock, recorded at zero cost basis, and 19,245 shares of Class C common stock and has subsequently sold all shares of Class C stock.
Dividend
Prosperity Bancshares declared a first quarter 2025 cash dividend of $0.58 per share to be paid on April 1, 2025, to all shareholders of record as of March 14, 2025.
Stock Repurchase Program
On January 21, 2025, Prosperity Bancshares announced a stock repurchase program under which up to 5%, or approximately 4.8 million shares, of its outstanding common stock may be acquired over a one-year period expiring on January 21, 2026, at the discretion of management. Under its 2024 stock repurchase program, Prosperity Bancshares repurchased zero shares of its common stock during the three months ended December 31, 2024, and approximately 1.2 million shares of its common stock at an average weighted price of $60.35 per share during the year ended December 31, 2024.
Merger of Lone Star State Bancshares, Inc.
On April 1, 2024, Prosperity completed the merger of Lone Star and its wholly owned subsidiary Lone Star Bank, headquartered in Lubbock, Texas. Lone Star Bank operated 5 full-service banking offices in the West Texas area, including its main office in Lubbock, and 1 banking center in each of Brownfield, Midland, Odessa and Big Spring, Texas.
Pursuant to the terms of the definitive agreement, Prosperity issued 2,376,182 shares of Prosperity common stock plus approximately $64.1 million in cash for all outstanding shares of Lone Star in the second quarter of 2024. This resulted in goodwill of $106.7 million as of December 31, 2024, which does not include all the subsequent fair value adjustments that have not yet been finalized.
Conference Call
Prosperity's management team will host a conference call on Wednesday, January 29, 2025, at 11:30 a.m. Eastern Time (10:30 a.m. Central Time) to discuss Prosperity's fourth quarter 2024 earnings. Individuals and investment professionals may participate in the call by dialing 877-883-0383 for domestic participants, or 412-902-6506 for international participants. The participant elite entry number is 7777695.
Alternatively, individuals may listen to the live webcast of the presentation by visiting Prosperity's website at www.prosperitybankusa.com. The webcast may be accessed from Prosperity's Investor Relations page by selecting "Presentations, Webcasts & Calls" from the menu and following the instructions.
Non-GAAP Financial Measures
Prosperity's management uses certain non-GAAP financial measures to evaluate its performance. Specifically, for internal planning and forecasting purposes, Prosperity reviews each of diluted earnings per share, return on average assets, return on average common equity, and return on average tangible common equity, in each case excluding merger related provision for credit losses, net of tax, merger related expenses, net of tax, FDIC special assessment, net of tax, and net gain on the sale or write-up of securities, net of tax; return on average tangible common equity; tangible book value per share; the tangible equity to tangible assets ratio; allowance for credit losses to total loans excluding Warehouse Purchase Program loans; the efficiency ratio, excluding net gains and losses on the sale, write-down or write-up of assets and securities; and the efficiency ratio, excluding net gains and losses on the sale, write-down or write-up of assets and securities, merger related expenses, and FDIC special assessment. Prosperity believes these non-GAAP financial measures provide information useful to investors in understanding Prosperity's financial results and their presentation, together with the accompanying reconciliations, provides a more complete understanding of factors and trends affecting Prosperity's business and allows investors to view performance in a manner similar to management, the entire financial services sector, bank stock analysts and bank regulators. Further, Prosperity believes that these non-GAAP financial measures provide useful information by excluding certain items that may not be indicative of its core operating earnings and business outlook. These non-GAAP financial measures should not be considered a substitute for, nor of greater importance than, GAAP basis financial measures and results; Prosperity strongly encourages investors to review its consolidated financial statements in their entirety and not to rely on any single financial measure. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies' non-GAAP financial measures having the same or similar names. Please refer to the "Notes to Selected Financial Data" at the end of this Earnings Release for a reconciliation of these non-GAAP financial measures to the nearest respective GAAP financial measures.
Prosperity Bancshares, Inc. ®
As of December 31, 2024, Prosperity Bancshares, Inc.® is a $39.567 billion Houston, Texas based regional financial holding company providing personal banking services and investments to consumers and businesses throughout Texas and Oklahoma. Founded in 1983, Prosperity believes in a community banking philosophy, taking care of customers, businesses and communities in the areas it serves by providing financial solutions to simplify everyday financial needs. In addition to offering traditional deposit and loan products, Prosperity offers digital banking solutions, credit and debit cards, mortgage services, retail brokerage services, trust and wealth management, and treasury management.
Prosperity currently operates 283 full-service banking locations: 65 in the Houston area, including The Woodlands; 30 in the South Texas area including Corpus Christi and Victoria; 62 in the Dallas/Fort Worth area; 22 in the East Texas area; 31 in the Central Texas area including Austin and San Antonio; 44 in the West Texas area including Lubbock, Midland-Odessa, Abilene, Amarillo and Wichita Falls; 15 in the Bryan/College Station area; 6 in the Central Oklahoma area; and 8 in the Tulsa, Oklahoma area.
Cautionary Notes on Forward-Looking Statements
"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: This release contains, and the remarks by Prosperity's management on the conference call may contain, forward-looking statements within the meaning of the federal securities laws, including Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. From time to time, oral or written forward-looking statements may also be included in other information released to the public. Such forward-looking statements are typically, but not exclusively, identified by the use in the statements of words or phrases such as "aim," "anticipate," "believe," "estimate," "expect," "goal," "guidance," "intend," "is anticipated," "is expected," "is intended," "objective," "plan," "projected," "projection," "will affect," "will be," "will continue," "will decrease," "will grow," "will impact," "will increase," "will incur," "will reduce," "will remain," "will result," "would be," variations of such words or phrases (including where the word "could," "may," or "would" is used rather than the word "will" in a phrase) and similar words and phrases indicating that the statement addresses some future result, occurrence, plan or objective. Forward-looking statements include all statements other than statements of historical fact, including forecasts or trends, and are based on current expectations, assumptions, estimates and projections about Prosperity Bancshares and its subsidiaries. These forward-looking statements may include information about Prosperity's possible or assumed future economic performance or future results of operations, including future revenues, income, expenses, provision for credit losses, provision for taxes, effective tax rate, earnings per share and cash flows and Prosperity's future capital expenditures and dividends, future financial condition and changes therein, including changes in Prosperity's loan portfolio and allowance for credit losses, changes in deposits, borrowings and the investment securities portfolio, future capital structure or changes therein, as well as the plans and objectives of management for Prosperity's future operations, future or proposed acquisitions, the future or expected effect of acquisitions on Prosperity's operations, results of operations, financial condition, and future economic performance, statements about the anticipated benefits of any proposed transactions, and statements about the assumptions underlying any such statement. These forward‑looking statements are not guarantees of future performance and are based on expectations and assumptions Prosperity currently believes to be valid. Because forward-looking statements relate to future results and occurrences, many of which are outside of Prosperity's control, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. These risks and uncertainties include, but are not limited to, whether Prosperity can: successfully identify acquisition targets and integrate the businesses of acquired companies and banks; continue to sustain its current internal growth rate or total growth rate; provide products and services that appeal to its customers; continue to have access to debt and equity capital markets; and achieve its sales objectives. Other risks include, but are not limited to: the possibility that credit quality could deteriorate; actions of competitors; changes in laws and regulations (including changes in governmental interpretations of regulations and changes in accounting standards); the possibility that the anticipated benefits of an acquisition transaction are not realized when expected or at all, including as a result of the impact of, or problems arising from, the integration of two companies or as a result of the strength of the economy and competitive factors generally; a deterioration or downgrade in the credit quality and credit agency ratings of the securities in Prosperity's securities portfolio; customer and consumer demand, including customer and consumer response to marketing; effectiveness of spending, investments or programs; fluctuations in the cost and availability of supply chain resources; economic conditions, including currency rate, interest rate and commodity price fluctuations; and the effect, impact, potential duration or other implications of weather and climate-related events. Prosperity disclaims any obligation to update such factors or to publicly announce the results of any revisions to any of the forward-looking statements included herein to reflect future events or developments. These and various other factors are discussed in Prosperity's Annual Report on Form 10-K for the year ended December 31, 2023, and other reports and statements Prosperity has filed with the Securities and Exchange Commission ("SEC"). Copies of the SEC filings for Prosperity may be downloaded from the Internet at no charge from http://www.prosperitybankusa.com.
(1) | Refer to the "Notes to Selected Financial Data" at the end of this Earnings Release for a reconciliation of this non-GAAP financial measure to the nearest GAAP financial measure. |
(2) | Includes purchase accounting adjustments of $3.3 million, net of tax, primarily comprised of loan discount accretion of $3.6 million for the three months ended December 31, 2024. |
(3) | Includes purchase accounting adjustments of $2.6 million, net of tax, primarily comprised of loan discount accretion of $2.5 million, merger related expenses of $278 thousand, and the FDIC special assessment of $19.9 million for the three months ended December 31, 2023. |
(4) | Includes purchase accounting adjustments of $4.3 million, net of tax, primarily comprised of loan discount accretion of $4.8 million for the three months ended September 30, 2024. |
(5) | Includes purchase accounting adjustments of $15.7 million, net of tax, primarily comprised of loan discount accretion of $17.5 million, merger related provision for credit losses of $9.1 million, merger related expenses of $4.5 million, FDIC special assessment of $3.6 million, and net gain on sale or write-up of securities of $11.2 million for the year ended December 31, 2024. |
(6) | Includes purchase accounting adjustments of $8.1 million, net of tax, primarily comprised of loan discount accretion of $8.0 million, merger related provision for credit losses of $18.5 million, merger related expenses of $15.1 million, and the FDIC special assessment of $19.9 million for the year ended December 31, 2023. |
Bryan/College Station Area | Grapevine Main | Tyler-South Broadway | Tomball | West | ||||
Bryan | Kiest | Tyler-University | Waller | |||||
Bryan-29th Street | Lake Highlands | Winnsboro | West Columbia | Odessa | ||||
Bryan-East | McKinney | Wharton | Grant | |||||
Bryan-North | McKinney Eldorado | Houston Area | Winnie | Kermit Highway | ||||
Caldwell | McKinney Redbud | Houston | Wirt | Parkway | ||||
College Station | North Carrolton | Aldine | ||||||
Hearne | Park Cities | Alief | South Texas Area - | Wichita Falls | ||||
Huntsville | Plano | Bellaire | Corpus Christi | Cattlemans | ||||
Madisonville | Plano-West | Beltway | Calallen | Kell | ||||
Navasota | Preston Forest | Clear Lake | Carmel | |||||
New Waverly | Preston Parker | Copperfield | Northwest | Other West Texas Area | ||||
Rock Prairie | Preston Royal | Cypress | Saratoga | Locations | ||||
Southwest Parkway | Red Oak | Downtown | Timbergate | Big Spring | ||||
Tower Point | Richardson | Eastex | Water Street | Big Spring - East | ||||
Wellborn Road | Richardson-West | Fairfield | Brownfield | |||||
Rosewood Court | First Colony | Victoria | Brownwood | |||||
Central Texas Area | The Colony | Fry Road | Victoria Main | Burkburnett | ||||
Austin | Tollroad | Gessner | Victoria-Navarro | Byers | ||||
Cedar Park | Trinity Mills | Gladebrook | Victoria-North | Cisco | ||||
Congress | Turtle Creek | Grand Parkway | Victoria Salem | Comanche | ||||
Lakeway | West 15th Plano | Heights | Early | |||||
Liberty Hill | West Allen | Highway 6 West | Other South Texas Area | Floydada | ||||
Northland | Westmoreland | Little York | Locations | Gorman | ||||
Oak Hill | Wylie | Medical Center | Alice | Henrietta | ||||
Research Blvd | Memorial Drive | Aransas Pass | Levelland | |||||
Westlake | Fort Worth | Northside | Beeville | Littlefield | ||||
Haltom City | Pasadena | Colony Creek | Merkel | |||||
Other Central Texas Area | Hulen | Pecan Grove | Cuero | Plainview | ||||
Locations | Keller | Pin Oak | Edna | San Angelo | ||||
Bastrop | Museum Place | River Oaks | Goliad | Slaton | ||||
Canyon Lake | Renaissance Square | Sugar Land | Gonzales | Snyder | ||||
Dime Box | Roanoke | SW Medical Center | Hallettsville | |||||
Dripping Springs | Stockyards | Tanglewood | Kingsville | Oklahoma | ||||
Elgin | The Plaza | Mathis | Central Oklahoma Area | |||||
Flatonia | Other Dallas/Fort Worth Area | Uptown | Padre Island | Oklahoma City | ||||
Fredericksburg | Locations | Waugh Drive | Palacios | 23rd Street | ||||
Georgetown | Arlington | Westheimer | Port Lavaca | Expressway | ||||
Gruene | Azle | West University | Portland | I-240 | ||||
Horseshoe Bay | Ennis | Woodcreek | Rockport | Memorial | ||||
Kingsland | Gainesville | Sinton | ||||||
La Grange | Glen Rose | Katy | Taft | Other Central Oklahoma Area | ||||
Lexington | Granbury | Cinco Ranch | Yoakum | Locations | ||||
Marble Falls | Grand Prairie | Katy-Spring Green | Yorktown | Edmond | ||||
New Braunfels | Jacksboro | Norman | ||||||
Pleasanton | Mesquite | The Woodlands | West Texas Area | |||||
Round Rock | Muenster | The Woodlands-College Park | Abilene | Tulsa Area | ||||
San Antonio | Runaway Bay | The Woodlands-I-45 | Antilley Road | Tulsa | ||||
Schulenburg | Sanger | The Woodlands-Research Forest | Barrow Street | Garnett | ||||
Seguin | Waxahachie | Cypress Street | Harvard | |||||
Smithville | Weatherford | Other Houston Area | Judge Ely | Memorial | ||||
Thorndale | Locations | Mockingbird | Sheridan | |||||
Weimar | East Texas Area | Angleton | S. Harvard | |||||
Athens | Bay City | Amarillo | Utica Tower | |||||
Dallas/Fort Worth Area | Blooming Grove | Beaumont | Hillside | Yale | ||||
Dallas | Canton | Cleveland | Soncy | |||||
14th Street Plano | Carthage | East Bernard | Other Tulsa Area Locations | |||||
Abrams Centre | Corsicana | El Campo | Lubbock | Owasso | ||||
Addison | Crockett | Dayton | 4th Street | |||||
Allen | Eustace | Galveston | 66th Street | |||||
Balch Springs | Gilmer | Groves | 82nd Street | |||||
Camp Wisdom | Grapeland | Hempstead | 86th Street | |||||
Carrollton | Gun Barrel City | Hitchcock | 98th Street | |||||
Cedar Hill | Jacksonville | Liberty | Avenue Q | |||||
Coppell | Kerens | Magnolia | Milwaukee | |||||
East Plano | Longview | Magnolia Parkway | North University | |||||
Euless | Mount Vernon | Mont Belvieu | Texas Tech Student Union | |||||
Frisco | Palestine | Nederland | ||||||
Frisco Warren | Rusk | Needville | Midland | |||||
Frisco-West | Seven Points | Rosenberg | North | |||||
Garland | Teague | Shadow Creek | Wadley | |||||
Grapevine | Tyler-Beckham | Spring | Wall Street |
Prosperity Bancshares, Inc.® Financial Highlights (Unaudited) (In thousands)
| ||||||||||||||||||||
Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | ||||||||||||||||
Balance Sheet Data (at period end) | ||||||||||||||||||||
Loans held for sale | $ | 10,690 | $ | 6,113 | $ | 9,951 | $ | 6,380 | $ | 5,734 | ||||||||||
Loans held for investment | 21,057,616 | 21,146,033 | 21,229,461 | 20,393,943 | 20,352,559 | |||||||||||||||
Loans held for investment - Warehouse Purchase Program | 1,080,903 | 1,228,706 | 1,081,403 | 864,924 | 822,245 | |||||||||||||||
Total loans | 22,149,209 | 22,380,852 | 22,320,815 | 21,265,247 | 21,180,538 | |||||||||||||||
Investment securities(A) | 11,094,424 | 11,300,756 | 11,702,139 | 12,301,138 | 12,803,896 | |||||||||||||||
Federal funds sold | 292 | 208 | 234 | 250 | 260 | |||||||||||||||
Allowance for credit losses on loans | (351,805) | (354,397) | (359,852) | (330,219) | (332,362) | |||||||||||||||
Cash and due from banks | 1,972,175 | 2,209,863 | 1,507,604 | 1,086,444 | 458,153 | |||||||||||||||
Goodwill | 3,503,129 | 3,504,388 | 3,504,107 | 3,396,402 | 3,396,086 | |||||||||||||||
Core deposit intangibles, net | 66,047 | 70,178 | 74,324 | 60,757 | 63,994 | |||||||||||||||
Other real estate owned | 5,701 | 5,757 | 4,960 | 2,204 | 1,708 | |||||||||||||||
Fixed assets, net | 371,238 | 373,812 | 377,394 | 372,333 | 369,992 | |||||||||||||||
Other assets | 756,328 | 623,903 | 630,569 | 601,964 | 605,612 | |||||||||||||||
Total assets | $ | 39,566,738 | $ | 40,115,320 | $ | 39,762,294 | $ | 38,756,520 | $ | 38,547,877 | ||||||||||
Noninterest-bearing deposits | $ | 9,798,438 | $ | 9,811,361 | $ | 9,706,505 | $ | 9,526,535 | $ | 9,776,572 | ||||||||||
Interest-bearing deposits | 18,582,900 | 18,276,250 | 18,226,581 | 17,648,983 | 17,403,237 | |||||||||||||||
Total deposits | 28,381,338 | 28,087,611 | 27,933,086 | 27,175,518 | 27,179,809 | |||||||||||||||
Other borrowings | 3,200,000 | 3,900,000 | 3,900,000 | 3,900,000 | 3,725,000 | |||||||||||||||
Securities sold under repurchase agreements | 221,913 | 228,896 | 233,689 | 261,671 | 309,277 | |||||||||||||||
Allowance for credit losses on off-balance sheet credit exposures | 37,646 | 37,646 | 37,646 | 36,503 | 36,503 | |||||||||||||||
Other liabilities | 287,346 | 499,918 | 374,429 | 278,284 | 217,958 | |||||||||||||||
Total liabilities | 32,128,243 | 32,754,071 | 32,478,850 | 31,651,976 | 31,468,547 | |||||||||||||||
Shareholders' equity(B) | 7,438,495 | 7,361,249 | 7,283,444 | 7,104,544 | 7,079,330 | |||||||||||||||
Total liabilities and equity | $ | 39,566,738 | $ | 40,115,320 | $ | 39,762,294 | $ | 38,756,520 | $ | 38,547,877 | ||||||||||
(A) | Includes $(2,056), $(1,070), $(2,007), $(2,954) and $(1,770) in unrealized losses on available for sale securities for the quarterly periods ended December 31, 2024, September 30, 2024, June 30, 2024, March 31, 2024 and December 31, 2023, respectively. |
(B) | Includes $(1,624), $(845), $(1,586), $(2,333) and $(1,398) in after-tax unrealized losses on available for sale securities for the quarterly periods ended December 31, 2024, September 30, 2024, June 30, 2024, March 31, 2024 and December 31, 2023, respectively. |
Prosperity Bancshares, Inc.® Financial Highlights (Unaudited) (In thousands)
| ||||||||||||||||||||||||||||
Three Months Ended | Year-to-Date | |||||||||||||||||||||||||||
Dec 31, | Sep 30, | Jun 30, | Mar 31, | Dec 31, | Dec 31, | Dec 31, | ||||||||||||||||||||||
Income Statement Data | ||||||||||||||||||||||||||||
Interest income: | ||||||||||||||||||||||||||||
Loans | $ | 333,055 | $ | 337,451 | $ | 336,428 | $ | 306,228 | $ | 306,562 | $ | 1,313,162 | $ | 1,148,996 | ||||||||||||||
Securities(C) | 58,260 | 59,617 | 62,428 | 66,421 | 68,077 | 246,726 | 283,302 | |||||||||||||||||||||
Federal funds sold and other earning assets | 19,630 | 20,835 | 14,095 | 9,265 | 1,793 | 63,825 | 12,245 | |||||||||||||||||||||
Total interest income | 410,945 | 417,903 | 412,951 | 381,914 | 376,432 | 1,623,713 | 1,444,543 | |||||||||||||||||||||
Interest expense: | ||||||||||||||||||||||||||||
Deposits | 102,050 | 107,758 | 106,124 | 92,692 | 84,969 | 408,624 | 272,345 | |||||||||||||||||||||
Other borrowings | 39,620 | 46,792 | 46,282 | 48,946 | 52,386 | 181,640 | 206,323 | |||||||||||||||||||||
Securities sold under repurchase agreements | 1,501 | 1,662 | 1,759 | 2,032 | 2,094 | 6,954 | 9,404 | |||||||||||||||||||||
Subordinated debentures | — | — | — | — | — | — | 38 | |||||||||||||||||||||
Total interest expense | 143,171 | 156,212 | 154,165 | 143,670 | 139,449 | 597,218 | 488,110 | |||||||||||||||||||||
Net interest income | 267,774 | 261,691 | 258,786 | 238,244 | 236,983 | 1,026,495 | 956,433 | |||||||||||||||||||||
Provision for credit losses | — | — | 9,066 | — | — | 9,066 | 18,540 | |||||||||||||||||||||
Net interest income after provision for credit losses | 267,774 | 261,691 | 249,720 | 238,244 | 236,983 | 1,017,429 | 937,893 | |||||||||||||||||||||
Noninterest income: | ||||||||||||||||||||||||||||
Nonsufficient funds (NSF) fees | 9,960 | 9,016 | 8,153 | 8,288 | 8,365 | 35,417 | 33,691 | |||||||||||||||||||||
Credit card, debit card and ATM card income | 9,443 | 9,620 | 9,384 | 8,861 | 9,314 | 37,308 | 36,471 | |||||||||||||||||||||
Service charges on deposit accounts | 6,992 | 6,664 | 6,436 | 6,406 | 6,316 | 26,498 | 24,582 | |||||||||||||||||||||
Trust income | 3,514 | 3,479 | 3,601 | 4,156 | 3,360 | 14,750 | 13,269 | |||||||||||||||||||||
Mortgage income | 779 | 962 | 745 | 610 | 542 | 3,096 | 2,298 | |||||||||||||||||||||
Brokerage income | 1,063 | 1,258 | 1,186 | 1,235 | 1,059 | 4,742 | 4,275 | |||||||||||||||||||||
Bank owned life insurance income | 2,020 | 2,028 | 1,885 | 2,047 | 1,882 | 7,980 | 6,653 | |||||||||||||||||||||
Net gain (loss) on sale or write-down of assets | 584 | 3,178 | (903) | (35) | (84) | 2,824 | 1,986 | |||||||||||||||||||||
Net gain on sale or write-up of securities | — | 224 | 10,723 | 298 | — | 11,245 | — | |||||||||||||||||||||
Other noninterest income | 5,482 | 4,670 | 4,793 | 7,004 | 5,814 | 21,949 | 30,040 | |||||||||||||||||||||
Total noninterest income | 39,837 | 41,099 | 46,003 | 38,870 | 36,568 | 165,809 | 153,265 | |||||||||||||||||||||
Noninterest expense: | ||||||||||||||||||||||||||||
Salaries and benefits | 88,631 | 88,367 | 89,584 | 85,771 | 80,486 | 352,353 | 328,430 | |||||||||||||||||||||
Net occupancy and equipment | 8,957 | 9,291 | 8,915 | 8,623 | 9,093 | 35,786 | 35,517 | |||||||||||||||||||||
Credit and debit card, data processing and software amortization | 12,342 | 11,985 | 11,998 | 10,975 | 10,741 | 47,300 | 41,570 | |||||||||||||||||||||
Regulatory assessments and FDIC insurance | 5,789 | 5,726 | 10,317 | 5,538 | 24,940 | 27,370 | 40,165 | |||||||||||||||||||||
Core deposit intangibles amortization | 4,131 | 4,146 | 4,156 | 3,237 | 3,559 | 15,670 | 12,676 | |||||||||||||||||||||
Depreciation | 4,791 | 4,741 | 4,836 | 4,686 | 4,607 | 19,054 | 18,283 | |||||||||||||||||||||
Communications | 3,450 | 3,360 | 3,485 | 3,402 | 3,572 | 13,697 | 14,413 | |||||||||||||||||||||
Other real estate expense | 255 | 12 | 69 | 187 | 165 | 523 | (88) | |||||||||||||||||||||
Net (gain) loss on sale or write-down of other real estate | (610) | (97) | 31 | (138) | 34 | (814) | (746) | |||||||||||||||||||||
Merger related expenses | — | 63 | 4,381 | — | 278 | 4,444 | 15,133 | |||||||||||||||||||||
Other noninterest expense | 13,809 | 12,744 | 15,070 | 13,567 | 14,696 | 55,190 | 51,345 | |||||||||||||||||||||
Total noninterest expense | 141,545 | 140,338 | 152,842 | 135,848 | 152,171 | 570,573 | 556,698 | |||||||||||||||||||||
Income before income taxes | 166,066 | 162,452 | 142,881 | 141,266 | 121,380 | 612,665 | 534,460 | |||||||||||||||||||||
Provision for income taxes | 35,990 | 35,170 | 31,279 | 30,840 | 25,904 | 133,279 | 115,144 | |||||||||||||||||||||
Net income available to common shareholders | $ | 130,076 | $ | 127,282 | $ | 111,602 | $ | 110,426 | $ | 95,476 | $ | 479,386 | $ | 419,316 | ||||||||||||||
(C) | Interest income on securities was reduced by net premium amortization of $5,609, $5,574, $5,831, $5,822 and $6,428 for the three months ended December 31, 2024, September 30, 2024, June 30, 2024, March 31, 2024 and December 31, 2023, respectively, and $22,836 and $27,840 for the years ended December 31, 2024, and 2023, respectively. |
Prosperity Bancshares, Inc. ® Financial Highlights (Unaudited) (Dollars and share amounts in thousands, except per share data and market prices)
| ||||||||||||||||||||||||||||
Three Months Ended | Year-to-Date | |||||||||||||||||||||||||||
Dec 31, | Sep 30, | Jun 30, | Mar 31, | Dec 31, | Dec 31, | Dec 31, | ||||||||||||||||||||||
Profitability | ||||||||||||||||||||||||||||
Net income (D) (E) | $ | 130,076 | $ | 127,282 | $ | 111,602 | $ | 110,426 | $ | 95,476 | $ | 479,386 | $ | 419,316 | ||||||||||||||
Basic earnings per share | $ | 1.37 | $ | 1.34 | $ | 1.17 | $ | 1.18 | $ | 1.02 | $ | 5.05 | $ | 4.51 | ||||||||||||||
Diluted earnings per share | $ | 1.37 | $ | 1.34 | $ | 1.17 | $ | 1.18 | $ | 1.02 | $ | 5.05 | $ | 4.51 | ||||||||||||||
Return on average assets (F) (J) | 1.31 | % | 1.28 | % | 1.12 | % | 1.13 | % | 0.98 | % | 1.21 | % | 1.08 | % | ||||||||||||||
Return on average common equity (F) (J) | 7.00 | % | 6.93 | % | 6.10 | % | 6.20 | % | 5.39 | % | 6.56 | % | 6.03 | % | ||||||||||||||
Return on average tangible common equity (F) (G) (J) | 13.50 | % | 13.50 | % | 11.81 | % | 12.06 | % | 10.54 | % | 12.73 | % | 11.76 | % | ||||||||||||||
Tax equivalent net interest margin (D) (E) (H) | 3.05 | % | 2.95 | % | 2.94 | % | 2.79 | % | 2.75 | % | 2.93 | % | 2.78 | % | ||||||||||||||
Efficiency ratio (G) (I) (K) | 46.10 | % | 46.87 | % | 51.82 | % | 49.07 | % | 55.61 | % | 48.43 | % | 50.26 | % | ||||||||||||||
Liquidity and Capital Ratios | ||||||||||||||||||||||||||||
Equity to assets | 18.80 | % | 18.35 | % | 18.32 | % | 18.33 | % | 18.37 | % | 18.80 | % | 18.37 | % | ||||||||||||||
Common equity tier 1 capital | 16.42 | % | 15.84 | % | 15.42 | % | 15.75 | % | 15.54 | % | 16.42 | % | 15.54 | % | ||||||||||||||
Tier 1 risk-based capital | 16.42 | % | 15.84 | % | 15.42 | % | 15.75 | % | 15.54 | % | 16.42 | % | 15.54 | % | ||||||||||||||
Total risk-based capital | 17.67 | % | 17.09 | % | 16.67 | % | 17.00 | % | 16.56 | % | 17.67 | % | 16.56 | % | ||||||||||||||
Tier 1 leverage capital | 10.82 | % | 10.52 | % | 10.29 | % | 10.37 | % | 10.39 | % | 10.82 | % | 10.39 | % | ||||||||||||||
Period end tangible equity to period end tangible assets (G) | 10.75 | % | 10.36 | % | 10.24 | % | 10.33 | % | 10.31 | % | 10.75 | % | 10.31 | % | ||||||||||||||
Other Data | ||||||||||||||||||||||||||||
Weighted-average shares used in computing earnings per common share | ||||||||||||||||||||||||||||
Basic | 95,264 | 95,261 | 95,765 | 93,706 | 93,715 | 95,000 | 92,902 | |||||||||||||||||||||
Diluted | 95,264 | 95,261 | 95,765 | 93,706 | 93,715 | 95,000 | 92,902 | |||||||||||||||||||||
Period end shares outstanding | 95,275 | 95,261 | 95,262 | 93,525 | 93,722 | 95,275 | 93,722 | |||||||||||||||||||||
Cash dividends paid per common share | $ | 0.58 | $ | 0.56 | $ | 0.56 | $ | 0.56 | $ | 0.56 | $ | 2.26 | $ | 2.21 | ||||||||||||||
Book value per common share | $ | 78.07 | $ | 77.27 | $ | 76.46 | $ | 75.96 | $ | 75.54 | $ | 78.07 | $ | 75.54 | ||||||||||||||
Tangible book value per common share (G) | $ | 40.61 | $ | 39.75 | $ | 38.89 | $ | 39.00 | $ | 38.62 | $ | 40.61 | $ | 38.62 | ||||||||||||||
Common Stock Market Price | ||||||||||||||||||||||||||||
High | $ | 86.76 | $ | 74.87 | $ | 66.18 | $ | 68.88 | $ | 68.79 | $ | 86.76 | $ | 78.76 | ||||||||||||||
Low | $ | 68.94 | $ | 58.66 | $ | 57.16 | $ | 60.08 | $ | 49.60 | $ | 57.16 | $ | 49.60 | ||||||||||||||
Period end closing price | $ | 75.35 | $ | 72.07 | $ | 61.14 | $ | 65.78 | $ | 67.73 | $ | 75.35 | $ | 67.73 | ||||||||||||||
Employees – FTE (excluding overtime) | 3,916 | 3,896 | 3,902 | 3,901 | 3,850 | 3,916 | 3,850 | |||||||||||||||||||||
Number of banking centers | 283 | 287 | 288 | 283 | 285 | 283 | 285 | |||||||||||||||||||||
(D) | Includes purchase accounting adjustments for the periods presented as follows: |
Three Months Ended | Year-to-Date | ||||||||||||
Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Dec 31, 2024 | Dec 31, 2023 | |||||||
Loan discount accretion | |||||||||||||
Non-PCD | $2,761 | $3,616 | $4,797 | $1,312 | $1,543 | $12,486 | $4,825 | ||||||
PCD | $850 | $1,212 | $2,394 | $548 | $937 | $5,004 | $3,221 | ||||||
Securities net accretion | $528 | $555 | $564 | $561 | $598 | $2,208 | $1,648 | ||||||
Time deposits amortization | $(21) | $(40) | $4 | $(97) | $(150) | $(154) | $(600) | ||||||
(E) | Using effective tax rate of 21.7%, 21.6%, 21.9%, 21.8% and 21.3% for the three months ended December 31, 2024, September 30, 2024, June 30, 2024, March 31, 2024 and December 31, 2023, respectively, and 21.8% and 21.5% for the years ended December 31, 2024 and 2023, respectively. |
(F) | Interim periods annualized. |
(G) | Refer to the "Notes to Selected Financial Data" at the end of this Earnings Release for a reconciliation of this non-GAAP financial measure to the nearest GAAP financial measure. |
(H) | Net interest margin for all periods presented is based on average balances on an actual 366-day or 365-day basis. |
(I) | Calculated by dividing total noninterest expense, excluding credit loss provisions, by net interest income plus noninterest income, excluding net gains and losses on the sale, write-down or write-up of assets and securities. Additionally, taxes are not part of this calculation. |
(J) | For calculations of the annualized returns on average assets, average common equity and average tangible common equity excluding merger related provision for credit losses, net of tax, merger related expenses, net of tax, FDIC special assessment, net of tax, and net gain on sale or write-up of securities, net of tax refer to the "Notes to Selected Financial Data" at the end of this Earnings Release for a reconciliation of this non-GAAP financial measure to the nearest GAAP financial measure. |
(K) | For calculations of the efficiency ratio excluding merger related expenses and FDIC special assessment refer to the "Notes to Selected Financial Data" at the end of this Earnings Release for a reconciliation of these non-GAAP financial measures to the nearest respective GAAP financial measures. |
Prosperity Bancshares, Inc.® Financial Highlights (Unaudited) (Dollars in thousands) | |||||||||||||||||||||||||||||||
YIELD ANALYSIS | Three Months Ended | ||||||||||||||||||||||||||||||
Dec 31, 2024 | Sep 30, 2024 | Dec 31, 2023 | |||||||||||||||||||||||||||||
Average | Interest | Average | (L) | Average | Interest | Average | (L) | Average | Interest | Average | (L) | ||||||||||||||||||||
Interest-earning assets: | |||||||||||||||||||||||||||||||
Loans held for sale | $ | 8,571 | $ | 144 | 6.68 % | $ | 7,913 | $ | 137 | 6.89 % | $ | 9,828 | $ | 185 | 7.47 % | ||||||||||||||||
Loans held for investment | 21,038,694 | 313,863 | 5.93 % | 21,107,139 | 316,939 | 5.97 % | 20,370,915 | 291,882 | 5.68 % | ||||||||||||||||||||||
Loans held for investment - Warehouse Purchase Program | 1,137,113 | 19,048 | 6.66 % | 1,114,681 | 20,375 | 7.27 % | 770,481 | 14,495 | 7.46 % | ||||||||||||||||||||||
Total loans | 22,184,378 | 333,055 | 5.97 % | 22,229,733 | 337,451 | 6.04 % | 21,151,224 | 306,562 | 5.75 % | ||||||||||||||||||||||
Investment securities | 11,265,535 | 58,260 | 2.06 % | (M) | 11,612,193 | 59,617 | 2.04 % | (M) | 13,074,243 | 68,077 | 2.07 % | (M) | |||||||||||||||||||
Federal funds sold and other earning assets | 1,628,050 | 19,630 | 4.80 % | 1,531,788 | 20,835 | 5.41 % | 125,295 | 1,793 | 5.68 % | ||||||||||||||||||||||
Total interest-earning assets | 35,077,963 | 410,945 | 4.66 % | 35,373,714 | 417,903 | 4.70 % | 34,350,762 | 376,432 | 4.35 % | ||||||||||||||||||||||
Allowance for credit losses on loans | (353,560) | (358,237) | (346,493) | ||||||||||||||||||||||||||||
Noninterest-earning assets | 4,902,996 | 4,873,725 | 4,810,942 | ||||||||||||||||||||||||||||
Total assets | $ | 39,627,399 | $ | 39,889,202 | $ | 38,815,211 | |||||||||||||||||||||||||
Interest-bearing liabilities: | |||||||||||||||||||||||||||||||
Interest-bearing demand deposits | $ | 4,845,174 | $ | 8,535 | 0.70 % | $ | 4,774,975 | $ | 9,251 | 0.77 % | $ | 4,822,698 | $ | 6,789 | 0.56 % | ||||||||||||||||
Savings and money market deposits | 8,915,410 | 47,089 | 2.10 % | 8,908,315 | 49,824 | 2.23 % | 8,815,892 | 45,192 | 2.03 % | ||||||||||||||||||||||
Certificates and other time deposits | 4,552,445 | 46,426 | 4.06 % | 4,564,232 | 48,683 | 4.24 % | 3,442,115 | 32,988 | 3.80 % | ||||||||||||||||||||||
Other borrowings | 3,332,609 | 39,620 | 4.73 % | 3,900,000 | 46,792 | 4.77 % | 4,028,263 | 52,386 | 5.16 % | ||||||||||||||||||||||
Securities sold under repurchase agreements | 231,240 | 1,501 | 2.58 % | 242,813 | 1,662 | 2.72 % | 300,317 | 2,094 | 2.77 % | ||||||||||||||||||||||
Total interest-bearing liabilities | 21,876,878 | 143,171 | 2.60 % | (N) | 22,390,335 | 156,212 | 2.78 % | (N) | 21,409,285 | 139,449 | 2.58 % | (N) | |||||||||||||||||||
Noninterest-bearing liabilities: | |||||||||||||||||||||||||||||||
Noninterest-bearing demand deposits | 9,829,912 | 9,680,785 | 9,960,240 | ||||||||||||||||||||||||||||
Allowance for credit losses on off-balance sheet credit exposures | 37,646 | 37,646 | 36,503 | ||||||||||||||||||||||||||||
Other liabilities | 454,298 | 433,171 | 323,344 | ||||||||||||||||||||||||||||
Total liabilities | 32,198,734 | 32,541,937 | 31,729,372 | ||||||||||||||||||||||||||||
Shareholders' equity | 7,428,665 | 7,347,265 | 7,085,839 | ||||||||||||||||||||||||||||
Total liabilities and shareholders' equity | $ | 39,627,399 | $ | 39,889,202 | $ | 38,815,211 | |||||||||||||||||||||||||
Net interest income and margin | $ | 267,774 | 3.04 % | $ | 261,691 | 2.94 % | $ | 236,983 | 2.74 % | ||||||||||||||||||||||
Non-GAAP to GAAP reconciliation: | |||||||||||||||||||||||||||||||
Tax equivalent adjustment | 767 | 808 | 952 | ||||||||||||||||||||||||||||
Net interest income and margin | $ | 268,541 | 3.05 % | $ | 262,499 | 2.95 % | $ | 237,935 | 2.75 % | ||||||||||||||||||||||
(L) | Annualized and based on an actual 366-day or 365-day basis. |
(M) | Yield on securities was impacted by net premium amortization of $5,609, $5,574 and $6,428 for the three months ended December 31, 2024, September 30, 2024 and December 31, 2023, respectively. |
(N) | Total cost of funds, including noninterest bearing deposits, was 1.80%, 1.94% and 1.76% for the three months ended December 31, 2024, September 30, 2024 and December 31, 2023, respectively. |
Prosperity Bancshares, Inc.® Financial Highlights (Unaudited) (Dollars in thousands) | |||||||||||||||||||||||
YIELD ANALYSIS | Year-to-Date | ||||||||||||||||||||||
Dec 31, 2024 | Dec 31, 2023 | ||||||||||||||||||||||
Average | Interest | Average | (O) | Average | Interest | Average | (O) | ||||||||||||||||
Interest-earning assets: | |||||||||||||||||||||||
Loans held for sale | $ | 7,603 | $ | 522 | 6.87 % | $ | 6,508 | $ | 452 | 6.95 % | |||||||||||||
Loans held for investment | 20,973,042 | 1,242,836 | 5.93 % | 19,754,541 | 1,089,743 | 5.52 % | |||||||||||||||||
Loans held for investment - Warehouse Purchase Program | 973,206 | 69,804 | 7.17 % | 815,853 | 58,801 | 7.21 % | |||||||||||||||||
Total loans | 21,953,851 | 1,313,162 | 5.98 % | 20,576,902 | 1,148,996 | 5.58 % | |||||||||||||||||
Investment securities | 11,934,793 | 246,726 | 2.07 % | (P) | 13,719,899 | 283,302 | 2.06 % | (P) | |||||||||||||||
Federal funds sold and other earning assets | 1,216,728 | 63,825 | 5.25 % | 248,691 | 12,245 | 4.92 % | |||||||||||||||||
Total interest-earning assets | 35,105,372 | 1,623,713 | 4.63 % | 34,545,492 | 1,444,543 | 4.18 % | |||||||||||||||||
Allowance for credit losses on loans | (344,167) | (314,350) | |||||||||||||||||||||
Noninterest-earning assets | 4,839,630 | 4,741,815 | |||||||||||||||||||||
Total assets | $ | 39,600,835 | $ | 38,972,957 | |||||||||||||||||||
Interest-bearing liabilities: | |||||||||||||||||||||||
Interest-bearing demand deposits | $ | 4,900,189 | $ | 35,342 | 0.72 % | $ | 5,150,049 | $ | 19,554 | 0.38 % | |||||||||||||
Savings and money market deposits | 8,949,010 | 194,317 | 2.17 % | 9,129,845 | 168,184 | 1.84 % | |||||||||||||||||
Certificates and other time deposits | 4,301,763 | 178,965 | 4.16 % | 2,832,754 | 84,607 | 2.99 % | |||||||||||||||||
Other borrowings | 3,802,910 | 181,640 | 4.78 % | 4,008,616 | 206,323 | 5.15 % | |||||||||||||||||
Securities sold under repurchase agreements | 257,171 | 6,954 | 2.70 % | 389,313 | 9,404 | 2.42 % | |||||||||||||||||
Subordinated debentures | — | — | — | 1,031 | 38 | 3.69 % | |||||||||||||||||
Total interest-bearing liabilities | 22,211,043 | 597,218 | 2.69 % | (Q) | 21,511,608 | 488,110 | 2.27 % | (Q) | |||||||||||||||
Noninterest-bearing liabilities: | |||||||||||||||||||||||
Noninterest-bearing demand deposits | 9,683,980 | 10,224,241 | |||||||||||||||||||||
Allowance for credit losses on off-balance sheet credit exposures | 37,134 | 33,271 | |||||||||||||||||||||
Other liabilities | 363,607 | 253,047 | |||||||||||||||||||||
Total liabilities | 32,295,764 | 32,022,167 | |||||||||||||||||||||
Shareholders' equity | 7,305,071 | 6,950,790 | |||||||||||||||||||||
Total liabilities and shareholders' equity | $ | 39,600,835 | $ | 38,972,957 | |||||||||||||||||||
Net interest income and margin | $ | 1,026,495 | 2.92 % | $ | 956,433 | 2.77 % | |||||||||||||||||
Non-GAAP to GAAP reconciliation: | |||||||||||||||||||||||
Tax equivalent adjustment | 3,183 | 3,640 | |||||||||||||||||||||
Net interest income and margin (tax equivalent basis) | $ | 1,029,678 | 2.93 % | $ | 960,073 | 2.78 % | |||||||||||||||||
(O) | Based on an actual 366-day or 365-day basis. |
(P) | Yield on securities was impacted by net premium amortization of $22,836 and $27,840 for the years ended December 31, 2024 and 2023, respectively. |
(Q) | Total cost of funds, including noninterest bearing deposits, was 1.87% and 1.54% for the years ended December 31, 2024 and 2023, respectively. |
Prosperity Bancshares, Inc.® Financial Highlights (Unaudited) (Dollars in thousands)
| |||||||||||||||||||
Three Months Ended | |||||||||||||||||||
Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | |||||||||||||||
YIELD TREND (R) | |||||||||||||||||||
Interest-Earning Assets: | |||||||||||||||||||
Loans held for sale | 6.68 | % | 6.89 | % | 7.10 | % | 6.77 | % | 7.47 | % | |||||||||
Loans held for investment | 5.93 | % | 5.97 | % | 6.02 | % | 5.77 | % | 5.68 | % | |||||||||
Loans held for investment - Warehouse Purchase Program | 6.66 | % | 7.27 | % | 7.42 | % | 7.51 | % | 7.46 | % | |||||||||
Total loans | 5.97 | % | 6.04 | % | 6.08 | % | 5.83 | % | 5.75 | % | |||||||||
Investment securities (S) | 2.06 | % | 2.04 | % | 2.06 | % | 2.10 | % | 2.07 | % | |||||||||
Federal funds sold and other earning assets | 4.80 | % | 5.41 | % | 5.52 | % | 5.54 | % | 5.68 | % | |||||||||
Total interest-earning assets | 4.66 | % | 4.70 | % | 4.68 | % | 4.45 | % | 4.35 | % | |||||||||
Interest-Bearing Liabilities: | |||||||||||||||||||
Interest-bearing demand deposits | 0.70 | % | 0.77 | % | 0.76 | % | 0.66 | % | 0.56 | % | |||||||||
Savings and money market deposits | 2.10 | % | 2.23 | % | 2.22 | % | 2.13 | % | 2.03 | % | |||||||||
Certificates and other time deposits | 4.06 | % | 4.24 | % | 4.27 | % | 4.05 | % | 3.80 | % | |||||||||
Other borrowings | 4.73 | % | 4.77 | % | 4.77 | % | 4.82 | % | 5.16 | % | |||||||||
Securities sold under repurchase agreements | 2.58 | % | 2.72 | % | 2.74 | % | 2.76 | % | 2.77 | % | |||||||||
Total interest-bearing liabilities | 2.60 | % | 2.78 | % | 2.76 | % | 2.62 | % | 2.58 | % | |||||||||
Net Interest Margin | 3.04 | % | 2.94 | % | 2.94 | % | 2.78 | % | 2.74 | % | |||||||||
Net Interest Margin (tax equivalent) | 3.05 | % | 2.95 | % | 2.94 | % | 2.79 | % | 2.75 | % | |||||||||
(R) | Annualized and based on average balances on an actual 366-day or 365-day basis. |
(S) | Yield on securities was impacted by net premium amortization of $5,609, $5,574, $5,831, $5,822 and $6,428 for the three months ended December 31, 2024, September 30, 2024, June 30, 2024, March 31, 2024 and December 31, 2023, respectively. |
Prosperity Bancshares, Inc.® Financial Highlights (Unaudited) (Dollars in thousands)
| ||||||||||||||||||||
Three Months Ended | ||||||||||||||||||||
Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | ||||||||||||||||
Balance Sheet Averages | ||||||||||||||||||||
Loans held for sale | $ | 8,571 | $ | 7,913 | $ | 8,446 | $ | 5,467 | $ | 9,828 | ||||||||||
Loans held for investment | 21,038,694 | 21,107,139 | 21,328,824 | 20,415,316 | 20,370,915 | |||||||||||||||
Loans held for investment - Warehouse Purchase Program | 1,137,113 | 1,114,681 | 917,026 | 720,650 | 770,481 | |||||||||||||||
Total loans | 22,184,378 | 22,229,733 | 22,254,296 | 21,141,433 | 21,151,224 | |||||||||||||||
Investment securities | 11,265,535 | 11,612,193 | 12,179,074 | 12,693,268 | 13,074,243 | |||||||||||||||
Federal funds sold and other earning assets | 1,628,050 | 1,531,788 | 1,026,251 | 672,840 | 125,295 | |||||||||||||||
Total interest-earning assets | 35,077,963 | 35,373,714 | 35,459,621 | 34,507,541 | 34,350,762 | |||||||||||||||
Allowance for credit losses on loans | (353,560) | (358,237) | (332,904) | (331,708) | (346,493) | |||||||||||||||
Cash and due from banks | 317,420 | 304,911 | 295,077 | 315,612 | 302,864 | |||||||||||||||
Goodwill | 3,505,030 | 3,504,300 | 3,482,448 | 3,396,177 | 3,396,224 | |||||||||||||||
Core deposit intangibles, net | 68,167 | 72,330 | 59,979 | 62,482 | 65,986 | |||||||||||||||
Other real estate | 6,778 | 5,339 | 3,071 | 2,319 | 4,781 | |||||||||||||||
Fixed assets, net | 373,561 | 375,626 | 377,369 | 372,458 | 370,900 | |||||||||||||||
Other assets | 632,040 | 611,219 | 604,187 | 610,649 | 670,187 | |||||||||||||||
Total assets | $ | 39,627,399 | $ | 39,889,202 | $ | 39,948,848 | $ | 38,935,530 | $ | 38,815,211 | ||||||||||
Noninterest-bearing deposits | $ | 9,829,912 | $ | 9,680,785 | $ | 9,780,211 | $ | 9,443,249 | $ | 9,960,240 | ||||||||||
Interest-bearing demand deposits | 4,845,174 | 4,774,975 | 4,839,194 | 5,143,585 | 4,822,698 | |||||||||||||||
Savings and money market deposits | 8,915,410 | 8,908,315 | 9,084,051 | 8,889,077 | 8,815,892 | |||||||||||||||
Certificates and other time deposits | 4,552,445 | 4,564,232 | 4,400,922 | 3,683,815 | 3,442,115 | |||||||||||||||
Total deposits | 28,142,941 | 27,928,307 | 28,104,378 | 27,159,726 | 27,040,945 | |||||||||||||||
Other borrowings | 3,332,609 | 3,900,000 | 3,900,000 | 4,083,132 | 4,028,263 | |||||||||||||||
Securities sold under repurchase agreements | 231,240 | 242,813 | 258,637 | 296,437 | 300,317 | |||||||||||||||
Allowance for credit losses on off-balance sheet credit exposures | 37,646 | 37,646 | 36,729 | 36,503 | 36,503 | |||||||||||||||
Other liabilities | 454,298 | 433,171 | 327,847 | 238,480 | 323,344 | |||||||||||||||
Shareholders' equity | 7,428,665 | 7,347,265 | 7,321,257 | 7,121,252 | 7,085,839 | |||||||||||||||
Total liabilities and equity | $ | 39,627,399 | $ | 39,889,202 | $ | 39,948,848 | $ | 38,935,530 | $ | 38,815,211 | ||||||||||
Prosperity Bancshares, Inc.® Financial Highlights (Unaudited) (Dollars in thousands)
| |||||||||||||||
Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | |||||||||||
Period End Balances | |||||||||||||||
Loan Portfolio | |||||||||||||||
Commercial and industrial | $1,962,111 | 8.8 % | $1,970,844 | 8.8 % | $2,023,531 | 9.1 % | $1,932,534 | 9.1 % | $1,936,717 | 9.2 % | |||||
Warehouse purchase program | 1,080,903 | 4.9 % | 1,228,706 | 5.5 % | 1,081,403 | 4.8 % | 864,924 | 4.1 % | 822,245 | 3.9 % | |||||
Construction, land development and other land loans | 2,859,281 | 12.9 % | 2,814,521 | 12.6 % | 2,828,372 | 12.7 % | 2,876,588 | 13.5 % | 3,076,591 | 14.5 % | |||||
1-4 family residential | 7,581,450 | 34.2 % | 7,557,858 | 33.8 % | 7,496,485 | 33.6 % | 7,331,251 | 34.5 % | 7,207,226 | 34.0 % | |||||
Home equity | 906,139 | 4.1 % | 919,676 | 4.1 % | 930,428 | 4.2 % | 950,169 | 4.5 % | 960,852 | 4.5 % | |||||
Commercial real estate (includes multi-family residential) | 5,800,985 | 26.2 % | 5,869,687 | 26.2 % | 5,961,884 | 26.7 % | 5,631,460 | 26.5 % | 5,662,948 | 26.7 % | |||||
Agriculture (includes farmland) | 1,033,546 | 4.7 % | 1,033,224 | 4.6 % | 1,037,361 | 4.6 % | 813,092 | 3.8 % | 816,043 | 3.9 % | |||||
Consumer and other | 378,817 | 1.7 % | 413,548 | 1.8 % | 340,611 | 1.5 % | 326,915 | 1.5 % | 329,593 | 1.6 % | |||||
Energy | 545,977 | 2.5 % | 572,788 | 2.6 % | 620,740 | 2.8 % | 538,314 | 2.5 % | 368,323 | 1.7 % | |||||
Total loans | $22,149,209 | $22,380,852 | $22,320,815 | $21,265,247 | $21,180,538 | ||||||||||
Deposit Types | |||||||||||||||
Noninterest-bearing DDA | $9,798,438 | 34.5 % | $9,811,361 | 34.9 % | $9,706,505 | 34.7 % | $9,526,535 | 35.1 % | $9,776,572 | 36.0 % | |||||
Interest-bearing DDA | 5,182,035 | 18.3 % | 4,800,758 | 17.1 % | 4,762,730 | 17.1 % | 4,867,247 | 17.9 % | 5,115,945 | 18.8 % | |||||
Money market | 6,229,022 | 21.9 % | 6,166,792 | 22.0 % | 6,180,769 | 22.1 % | 6,134,221 | 22.6 % | 5,859,701 | 21.6 % | |||||
Savings | 2,685,496 | 9.5 % | 2,707,982 | 9.6 % | 2,765,197 | 9.9 % | 2,830,117 | 10.4 % | 2,881,397 | 10.6 % | |||||
Certificates and other time deposits | 4,486,347 | 15.8 % | 4,600,718 | 16.4 % | 4,517,885 | 16.2 % | 3,817,398 | 14.0 % | 3,546,194 | 13.0 % | |||||
Total deposits | $28,381,338 | $28,087,611 | $27,933,086 | $27,175,518 | $27,179,809 | ||||||||||
Loan to Deposit Ratio | 78.0 % | 79.7 % | 79.9 % | 78.3 % | 77.9 % | ||||||||||
Prosperity Bancshares, Inc.® Financial Highlights (Unaudited) (Dollars in thousands)
| |||||||||||||||||||||||||||||||||||
Construction Loans | |||||||||||||||||||||||||||||||||||
Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | |||||||||||||||||||||||||||||||
Single family residential construction | $ | 778,067 | 27.2 | % | $ | 836,571 | 29.7 | % | $ | 940,381 | 33.2 | % | $ | 1,031,163 | 35.8 | % | $ | 1,088,636 | 35.4 | % | |||||||||||||||
Land development | 260,158 | 9.1 | % | 256,571 | 9.1 | % | 241,639 | 8.5 | % | 290,243 | 10.1 | % | 367,849 | 12.0 | % | ||||||||||||||||||||
Raw land | 278,892 | 9.7 | % | 263,411 | 9.4 | % | 291,112 | 10.3 | % | 311,265 | 10.8 | % | 328,365 | 10.7 | % | ||||||||||||||||||||
Residential lots | 209,850 | 7.3 | % | 217,920 | 7.7 | % | 222,343 | 7.9 | % | 224,901 | 7.8 | % | 222,591 | 7.2 | % | ||||||||||||||||||||
Commercial lots | 59,044 | 2.1 | % | 58,472 | 2.1 | % | 60,264 | 2.1 | % | 59,691 | 2.1 | % | 155,415 | 5.0 | % | ||||||||||||||||||||
Commercial construction and other | 1,274,619 | 44.6 | % | 1,183,127 | 42.0 | % | 1,074,361 | 38.0 | % | 959,687 | 33.4 | % | 914,436 | 29.7 | % | ||||||||||||||||||||
Net unaccreted discount | (1,349) | (1,551) | (1,728) | (362) | (701) | ||||||||||||||||||||||||||||||
Total construction loans | $ | 2,859,281 | $ | 2,814,521 | $ | 2,828,372 | $ | 2,876,588 | $ | 3,076,591 | |||||||||||||||||||||||||
Non-Owner Occupied Commercial Real Estate Loans by Metropolitan Statistical Area (MSA) as of December 31, 2024 | ||||||||||||||||||||||||||||
Houston | Dallas | Austin | OK City | Tulsa | Other (T) | Total | ||||||||||||||||||||||
Collateral Type | ||||||||||||||||||||||||||||
Shopping center/retail | $ | 344,055 | $ | 256,356 | $ | 57,090 | $ | 15,746 | $ | 13,607 | $ | 339,865 | $ | 1,026,719 | ||||||||||||||
Commercial and industrial buildings | 140,411 | 110,911 | 22,433 | 35,081 | 16,347 | 282,227 | 607,410 | |||||||||||||||||||||
Office buildings | 98,017 | 220,871 | 88,601 | 46,841 | 3,553 | 83,749 | 541,632 | |||||||||||||||||||||
Medical buildings | 75,021 | 16,087 | 1,684 | 42,747 | 29,340 | 77,895 | 242,774 | |||||||||||||||||||||
Apartment buildings | 93,512 | 120,066 | 64,620 | 12,691 | 12,966 | 210,558 | 514,413 | |||||||||||||||||||||
Hotel | 110,790 | 105,085 | 31,414 | 11,685 | — | 188,618 | 447,592 | |||||||||||||||||||||
Other | 175,305 | 53,479 | 19,687 | 7,577 | 6,931 | 94,800 | 357,779 | |||||||||||||||||||||
Total | $ | 1,037,111 | $ | 882,855 | $ | 285,529 | $ | 172,368 | $ | 82,744 | $ | 1,277,712 | $ | 3,738,319 | (U) | |||||||||||||
Acquired Loans
| |||||||||||||||||||||||||||||||||||
Non-PCD Loans | PCD Loans | Total Acquired Loans | |||||||||||||||||||||||||||||||||
Balance at | Balance at | Balance at | Balance at | Balance at | Balance at | Balance at | Balance at | Balance at | |||||||||||||||||||||||||||
Loan marks: | |||||||||||||||||||||||||||||||||||
Acquired banks (V) | $ | 368,247 | $ | 14,903 | $ | 14,201 | $ | 327,842 | $ | 6,361 | $ | 5,931 | $ | 696,089 | $ | 21,264 | $ | 20,132 | |||||||||||||||||
Lone Star Bank (W) | 20,378 | 15,709 | 13,644 | 4,558 | 1,913 | 1,459 | 24,936 | 17,622 | 15,103 | ||||||||||||||||||||||||||
Total | 388,625 | 30,612 | 27,845 | 332,400 | 8,274 | 7,390 | 721,025 | 38,886 | 35,235 | ||||||||||||||||||||||||||
Acquired portfolio loan balances: | |||||||||||||||||||||||||||||||||||
Acquired banks (V) | 13,307,853 | 1,446,161 | 1,353,801 | 1,317,564 | 413,864 | 389,794 | 14,625,417 | 1,860,025 | 1,743,595 | ||||||||||||||||||||||||||
Lone Star Bank (W) | 1,016,128 | 868,114 | 735,828 | 59,109 | 54,793 | 50,230 | 1,075,237 | 922,907 | 786,058 | ||||||||||||||||||||||||||
Total | 14,323,981 | 2,314,275 | 2,089,629 | 1,376,673 | 468,657 | 440,024 | 15,700,654 | (X) | 2,782,932 | 2,529,653 | |||||||||||||||||||||||||
Acquired portfolio loan balances less loan marks | $ | 13,935,356 | $ | 2,283,663 | $ | 2,061,784 | $ | 1,044,273 | $ | 460,383 | $ | 432,634 | $ | 14,979,629 | $ | 2,744,046 | $ | 2,494,418 | |||||||||||||||||
(T) | Includes other MSA and non-MSA regions. |
(U) | Represents a portion of total commercial real estate loans of $5.801 billion as of December 31, 2024. |
(V) | Includes Bank Arlington, American State Bank, Community National Bank, First Federal Bank Texas, Coppermark Bank, First Victoria National Bank, The F&M Bank & Trust Company, Tradition Bank, LegacyTexas Bank and FirstCapital Bank. |
(W) | The Merger was completed on April 1, 2024 and resulted in the addition of $1.075 billion in loans with related purchase accounting adjustments of $24.9 million at acquisition date, which were subject to subsequent fair value adjustments. |
(X) | Actual principal balances acquired. |
Prosperity Bancshares, Inc.® Financial Highlights (Unaudited) (Dollars in thousands)
| |||||||||||||||||||||||||||
Three Months Ended | Year-to-Date | ||||||||||||||||||||||||||
Dec 31, | Sep 30, | Jun 30, | Mar 31, | Dec 31, | Dec 31, | Dec 31, | |||||||||||||||||||||
Asset Quality | |||||||||||||||||||||||||||
Nonaccrual loans | $ | 73,647 | $ | 83,969 | $ | 84,175 | $ | 78,475 | $ | 68,688 | $ | 73,647 | $ | 68,688 | |||||||||||||
Accruing loans 90 or more days past due | 2,189 | 20 | 322 | 3,035 | 2,195 | 2,189 | 2,195 | ||||||||||||||||||||
Total nonperforming loans | 75,836 | 83,989 | 84,497 | 81,510 | 70,883 | 75,836 | 70,883 | ||||||||||||||||||||
Repossessed assets | 4 | 177 | 113 | 97 | 76 | 4 | 76 | ||||||||||||||||||||
Other real estate | 5,701 | 5,757 | 4,960 | 2,204 | 1,708 | 5,701 | 1,708 | ||||||||||||||||||||
Total nonperforming assets | $ | 81,541 | $ | 89,923 | $ | 89,570 | $ | 83,811 | $ | 72,667 | $ | 81,541 | $ | 72,667 | |||||||||||||
Nonperforming assets: | |||||||||||||||||||||||||||
Commercial and industrial (includes energy) | $ | 10,080 | $ | 13,642 | $ | 16,340 | $ | 10,199 | $ | 8,957 | $ | 10,080 | $ | 8,957 | |||||||||||||
Construction, land development and other land loans | 4,481 | 4,053 | 4,895 | 15,826 | 17,343 | 4,481 | 17,343 | ||||||||||||||||||||
1-4 family residential (includes home equity) | 44,824 | 36,660 | 33,935 | 30,206 | 26,096 | 44,824 | 26,096 | ||||||||||||||||||||
Commercial real estate (includes multi-family residential) | 18,861 | 32,803 | 31,776 | 23,720 | 18,775 | 18,861 | 18,775 | ||||||||||||||||||||
Agriculture (includes farmland) | 3,208 | 2,686 | 2,550 | 3,714 | 1,460 | 3,208 | 1,460 | ||||||||||||||||||||
Consumer and other | 87 | 79 | 74 | 146 | 36 | 87 | 36 | ||||||||||||||||||||
Total | $ | 81,541 | $ | 89,923 | $ | 89,570 | $ | 83,811 | $ | 72,667 | $ | 81,541 | $ | 72,667 | |||||||||||||
Number of loans/properties | 368 | 346 | 349 | 319 | 292 | 368 | 292 | ||||||||||||||||||||
Allowance for credit losses on loans | $ | 351,805 | $ | 354,397 | $ | 359,852 | $ | 330,219 | $ | 332,362 | $ | 351,805 | $ | 332,362 | |||||||||||||
Net charge-offs (recoveries): | |||||||||||||||||||||||||||
Commercial and industrial (includes energy) | $ | 405 | $ | 3,309 | $ | 2,777 | $ | 283 | $ | 16,123 | $ | 6,774 | $ | 16,405 | |||||||||||||
Construction, land development and other land loans | 294 | 378 | 109 | (2) | (5) | 779 | 27 | ||||||||||||||||||||
1-4 family residential (includes home equity) | 180 | 409 | 425 | 457 | 20 | 1,471 | (268) | ||||||||||||||||||||
Commercial real estate (includes multi-family residential) | 362 | 258 | (381) | (17) | 1,590 | 222 | 17,116 | ||||||||||||||||||||
Agriculture (includes farmland) | 5 | (116) | 214 | 23 | — | 126 | (84) | ||||||||||||||||||||
Consumer and other | 1,346 | 1,217 | 1,224 | 1,399 | 1,405 | 5,186 | 4,795 | ||||||||||||||||||||
Total | $ | 2,592 | $ | 5,455 | $ | 4,368 | $ | 2,143 | $ | 19,133 | $ | 14,558 | $ | 37,991 | |||||||||||||
Asset Quality Ratios | |||||||||||||||||||||||||||
Nonperforming assets to average interest-earning assets | 0.23 | % | 0.25 | % | 0.25 | % | 0.24 | % | 0.21 | % | 0.23 | % | 0.21 | % | |||||||||||||
Nonperforming assets to loans and other real estate | 0.37 | % | 0.40 | % | 0.40 | % | 0.39 | % | 0.34 | % | 0.37 | % | 0.34 | % | |||||||||||||
Net charge-offs to average loans (annualized) | 0.05 | % | 0.10 | % | 0.08 | % | 0.04 | % | 0.36 | % | 0.07 | % | 0.18 | % | |||||||||||||
Allowance for credit losses on loans to total loans | 1.59 | % | 1.58 | % | 1.61 | % | 1.55 | % | 1.57 | % | 1.59 | % | 1.57 | % | |||||||||||||
Allowance for credit losses on loans to total loans, excluding Warehouse Purchase Program loans (G) | 1.67 | % | 1.68 | % | 1.69 | % | 1.62 | % | 1.63 | % | 1.67 | % | 1.63 | % | |||||||||||||
Prosperity Bancshares, Inc.®
Notes to Selected Financial Data (Unaudited)
(Dollars and share amounts in thousands, except per share data)
NOTES TO SELECTED FINANCIAL DATA
Prosperity's management uses certain non-GAAP (generally accepted accounting principles) financial measures to evaluate its performance. Specifically, for internal planning and forecasting purposes, Prosperity reviews each of diluted earnings per share, return on average assets, return on average common equity, and return on average tangible common equity, in each case excluding merger related provision for credit losses, net of tax, merger related expenses, net of tax, FDIC special assessment, net of tax, and net gain on sale or write-up of securities, net of tax; return on average tangible common equity; tangible book value per share; the tangible equity to tangible assets ratio; allowance for credit losses to total loans excluding Warehouse Purchase Program loans; the efficiency ratio, excluding net gains and losses on the sale, write-down or write-up of assets and securities; and the efficiency ratio, excluding net gains and losses on the sale, write-down or write-up of assets and securities, merger related expenses and FDIC special assessment. In addition, due to the application of purchase accounting, Prosperity uses certain non-GAAP financial measures and ratios that exclude the impact of these items to evaluate its allowance for credit losses to total loans (excluding Warehouse Purchase Program loans). Prosperity has included information below relating to these non-GAAP financial measures for the applicable periods presented.
Three Months Ended | Year-to-Date | |||||||||||||
Dec 31, | Sep 30, | Jun 30, | Mar 31, | Dec 31, | Dec 31, | Dec 31, | ||||||||
Reconciliation of diluted earnings per share to diluted earnings per share excluding | ||||||||||||||
Diluted earnings per share (unadjusted) | $ 1.37 | $ 1.34 | $ 1.17 | $ 1.18 | $ 1.02 | $ 5.05 | $ 4.51 | |||||||
Net income | $ 130,076 | $ 127,282 | $ 111,602 | $ 110,426 | $ 95,476 | $ 479,386 | $ 419,316 | |||||||
Merger related provision for credit losses, net of tax(Y) | — | — | 7,162 | — | — | 7,162 | 14,647 | |||||||
Merger related expenses, net of tax(Y) | — | 50 | 3,461 | — | 220 | 3,511 | 11,955 | |||||||
FDIC special assessment, net of tax(Y) | — | — | 2,807 | — | 15,736 | 2,807 | 15,736 | |||||||
Net gain on sale or write-up of securities, net of tax(Y) | — | (177) | (8,472) | (235) | — | (8,884) | — | |||||||
Net income excluding merger related provision for credit losses, net of tax, merger | $ 130,076 | $ 127,155 | $ 116,560 | $ 110,191 | $ 111,432 | $ 483,982 | $ 461,654 | |||||||
Weighted average diluted shares outstanding | 95,264 | 95,261 | 95,765 | 93,706 | 93,715 | 95,000 | 92,902 | |||||||
Merger related provision for credit losses, net of tax, per diluted common share(Y) | $ — | $ — | $ 0.07 | $ — | $ — | $ 0.08 | $ 0.16 | |||||||
Merger related expenses, net of tax, per diluted common share(Y) | $ — | $ — | $ 0.04 | $ — | $ — | $ 0.04 | $ 0.13 | |||||||
FDIC special assessment, net of tax, per diluted common share(Y) | $ — | $ — | $ 0.03 | $ — | $ 0.17 | $ 0.03 | $ 0.17 | |||||||
Net gain on sale or write-up of securities, net of tax, per diluted common share(Y) | $ — | $ — | $ (0.09) | $ — | $ — | $ (0.09) | $ — | |||||||
Diluted earnings per share excluding merger related provision for credit losses, net of tax, | $ 1.37 | $ 1.34 | $ 1.22 | $ 1.18 | $ 1.19 | $ 5.11 | $ 4.97 | |||||||
Reconciliation of return on average assets to return on average assets excluding | ||||||||||||||
Return on average assets (unadjusted) | 1.31 % | 1.28 % | 1.12 % | 1.13 % | 0.98 % | 1.21 % | 1.08 % | |||||||
Net income excluding merger related provision for credit losses, net of tax, merger | $ 130,076 | $ 127,155 | $ 116,560 | $ 110,191 | $ 111,432 | $ 483,982 | $ 461,654 | |||||||
Average total assets | $ 39,627,399 | $ 39,889,202 | $ 39,948,848 | $ 38,935,530 | $ 38,815,211 | $ 39,600,835 | $ 38,972,957 | |||||||
Return on average assets excluding merger related provision for credit losses, net of tax, | 1.31 % | 1.28 % | 1.17 % | 1.13 % | 1.15 % | 1.22 % | 1.18 % | |||||||
(Y) Calculated assuming a federal tax rate of 21.0%. | ||||||||||||||
Three Months Ended | Year-to-Date | |||||||||||||
Dec 31, | Sep 30, | Jun 30, | Mar 31, | Dec 31, | Dec 31, | Dec 31, | ||||||||
Reconciliation of return on average common equity to return on average common | ||||||||||||||
Return on average common equity (unadjusted) | 7.00 % | 6.93 % | 6.10 % | 6.20 % | 5.39 % | 6.56 % | 6.03 % | |||||||
Net income excluding merger related provision for credit losses, net of tax, merger | $ 130,076 | $ 127,155 | $ 116,560 | $ 110,191 | $ 111,432 | $ 483,982 | $ 461,654 | |||||||
Average shareholders' equity | $ 7,428,665 | $ 7,347,265 | $ 7,321,257 | $ 7,121,252 | $ 7,085,839 | $ 7,305,071 | $ 6,950,790 | |||||||
Return on average common equity excluding merger related provision for credit losses, | 7.00 % | 6.92 % | 6.37 % | 6.19 % | 6.29 % | 6.63 % | 6.64 % | |||||||
Reconciliation of return on average common equity to return on average tangible | ||||||||||||||
Net income | $ 130,076 | $ 127,282 | $ 111,602 | $ 110,426 | $ 95,476 | $ 479,386 | $ 419,316 | |||||||
Average shareholders' equity | $ 7,428,665 | $ 7,347,265 | $ 7,321,257 | $ 7,121,252 | $ 7,085,839 | $ 7,305,071 | $ 6,950,790 | |||||||
Less: Average goodwill and other intangible assets | (3,573,197) | (3,576,630) | (3,542,427) | (3,458,659) | (3,462,210) | (3,537,930) | (3,385,984) | |||||||
Average tangible shareholders' equity | $ 3,855,468 | $ 3,770,635 | $ 3,778,830 | $ 3,662,593 | $ 3,623,629 | $ 3,767,141 | $ 3,564,806 | |||||||
Return on average tangible common equity (F) | 13.50 % | 13.50 % | 11.81 % | 12.06 % | 10.54 % | 12.73 % | 11.76 % | |||||||
Reconciliation of return on average common equity to return on average tangible | ||||||||||||||
Net income excluding merger related provision for credit losses, net of tax, merger | $ 130,076 | $ 127,155 | $ 116,560 | $ 110,191 | $ 111,432 | $ 483,982 | $ 461,654 | |||||||
Average shareholders' equity | $ 7,428,665 | $ 7,347,265 | $ 7,321,257 | $ 7,121,252 | $ 7,085,839 | $ 7,305,071 | $ 6,950,790 | |||||||
Less: Average goodwill and other intangible assets | (3,573,197) | (3,576,630) | (3,542,427) | (3,458,659) | (3,462,210) | (3,537,930) | (3,385,984) | |||||||
Average tangible shareholders' equity | $ 3,855,468 | $ 3,770,635 | $ 3,778,830 | $ 3,662,593 | $ 3,623,629 | $ 3,767,141 | $ 3,564,806 | |||||||
Return on average tangible common equity excluding merger related provision for credit | 13.50 % | 13.49 % | 12.34 % | 12.03 % | 12.30 % | 12.85 % | 12.95 % | |||||||
Reconciliation of book value per share to tangible book value per share: | ||||||||||||||
Shareholders' equity | $ 7,438,495 | $ 7,361,249 | $ 7,283,444 | $ 7,104,544 | $ 7,079,330 | $ 7,438,495 | $ 7,079,330 | |||||||
Less: Goodwill and other intangible assets | (3,569,176) | (3,574,566) | (3,578,431) | (3,457,159) | (3,460,080) | (3,569,176) | (3,460,080) | |||||||
Tangible shareholders' equity | $ 3,869,319 | $ 3,786,683 | $ 3,705,013 | $ 3,647,385 | $ 3,619,250 | $ 3,869,319 | $ 3,619,250 | |||||||
Period end shares outstanding | 95,275 | 95,261 | 95,262 | 93,525 | 93,722 | 95,275 | 93,722 | |||||||
Tangible book value per share | $ 40.61 | $ 39.75 | $ 38.89 | $ 39.00 | $ 38.62 | $ 40.61 | $ 38.62 | |||||||
Reconciliation of equity to assets ratio to period end tangible equity to period end | ||||||||||||||
Tangible shareholders' equity | $ 3,869,319 | $ 3,786,683 | $ 3,705,013 | $ 3,647,385 | $ 3,619,250 | $ 3,869,319 | $ 3,619,250 | |||||||
Total assets | $ 39,566,738 | $ 40,115,320 | $ 39,762,294 | $ 38,756,520 | $ 38,547,877 | $ 39,566,738 | $ 38,547,877 | |||||||
Less: Goodwill and other intangible assets | (3,569,176) | (3,574,566) | (3,578,431) | (3,457,159) | (3,460,080) | (3,569,176) | (3,460,080) | |||||||
Tangible assets | $ 35,997,562 | $ 36,540,754 | $ 36,183,863 | $ 35,299,361 | $ 35,087,797 | $ 35,997,562 | $ 35,087,797 | |||||||
Period end tangible equity to period end tangible assets ratio | 10.75 % | 10.36 % | 10.24 % | 10.33 % | 10.31 % | 10.75 % | 10.31 % | |||||||
Three Months Ended | Year-to-Date | |||||||||||||
Dec 31, | Sep 30, | Jun 30, | Mar 31, | Dec 31, | Dec 31, | Dec 31, | ||||||||
Reconciliation of allowance for credit losses to total loans to allowance for credit | ||||||||||||||
Allowance for credit losses on loans | $ 351,805 | $ 354,397 | $ 359,852 | $ 330,219 | $ 332,362 | $ 351,805 | $ 332,362 | |||||||
Total loans | $ 22,149,209 | $ 22,380,852 | $ 22,320,815 | $ 21,265,247 | $ 21,180,538 | $ 22,149,209 | $ 21,180,538 | |||||||
Less: Warehouse Purchase Program loans | (1,080,903) | (1,228,706) | (1,081,403) | (864,924) | (822,245) | (1,080,903) | (822,245) | |||||||
Total loans less Warehouse Purchase Program | $ 21,068,306 | $ 21,152,146 | $ 21,239,412 | $ 20,400,323 | $ 20,358,293 | $ 21,068,306 | $ 20,358,293 | |||||||
Allowance for credit losses on loans to total loans excluding Warehouse Purchase | 1.67 % | 1.68 % | 1.69 % | 1.62 % | 1.63 % | 1.67 % | 1.63 % | |||||||
Reconciliation of efficiency ratio to efficiency ratio excluding net gains and losses | ||||||||||||||
Noninterest expense | $ 141,545 | $ 140,338 | $ 152,842 | $ 135,848 | $ 152,171 | $ 570,573 | $ 556,698 | |||||||
Net interest income | $ 267,774 | $ 261,691 | $ 258,786 | $ 238,244 | $ 236,983 | $ 1,026,495 | $ 956,433 | |||||||
Noninterest income | 39,837 | 41,099 | 46,003 | 38,870 | 36,568 | 165,809 | 153,265 | |||||||
Less: net (loss) gain on sale or write-down of assets | 584 | 3,178 | (903) | (35) | (84) | 2,824 | 1,986 | |||||||
Less: net gain on sale or write-up of securities | — | 224 | 10,723 | 298 | — | 11,245 | — | |||||||
Noninterest income excluding net gains and losses on the sale, write-down or write-up of | 39,253 | 37,697 | 36,183 | 38,607 | 36,652 | 151,740 | 151,279 | |||||||
Total income excluding net gains and losses on the sale, write-down or write-up of | $ 307,027 | $ 299,388 | $ 294,969 | $ 276,851 | $ 273,635 | $ 1,178,235 | $ 1,107,712 | |||||||
Efficiency ratio, excluding net gains and losses on the sale, write-down or write-up of | 46.10 % | 46.87 % | 51.82 % | 49.07 % | 55.61 % | 48.43 % | 50.26 % | |||||||
Reconciliation of efficiency ratio to efficiency ratio, excluding net gains and losses | ||||||||||||||
Noninterest expense | $ 141,545 | $ 140,338 | $ 152,842 | $ 135,848 | $ 152,171 | $ 570,573 | $ 556,698 | |||||||
Less: merger related expenses | — | 63 | 4,381 | — | 278 | 4,444 | 15,133 | |||||||
Less: FDIC special assessment | — | — | 3,554 | — | 19,919 | 3,554 | 19,919 | |||||||
Noninterest expense excluding merger related expenses and FDIC special assessment | $ 141,545 | $ 140,275 | $ 144,907 | $ 135,848 | $ 131,974 | $ 562,575 | $ 521,646 | |||||||
Net interest income | $ 267,774 | $ 261,691 | $ 258,786 | $ 238,244 | $ 236,983 | $ 1,026,495 | $ 956,433 | |||||||
Noninterest income | 39,837 | 41,099 | 46,003 | 38,870 | 36,568 | 165,809 | 153,265 | |||||||
Less: net (loss) gain on sale or write down of assets | 584 | 3,178 | (903) | (35) | (84) | 2,824 | 1,986 | |||||||
Less: net gain on sale or write-up of securities | — | 224 | 10,723 | 298 | — | 11,245 | — | |||||||
Noninterest income excluding net gains and losses on the sale, write-down or write-up of | 39,253 | 37,697 | 36,183 | 38,607 | 36,652 | 151,740 | 151,279 | |||||||
Total income excluding net gains and losses on the sale, write-down or write-up of | $ 307,027 | $ 299,388 | $ 294,969 | $ 276,851 | $ 273,635 | $ 1,178,235 | $ 1,107,712 | |||||||
Efficiency ratio, excluding net gains and losses on the sale, write-down or write-up of | 46.10 % | 46.85 % | 49.13 % | 49.07 % | 48.23 % | 47.75 % | 47.09 % | |||||||
SOURCE Prosperity Bancshares, Inc.
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