Prosperity Bancshares (PB) investor relations material

Executive summary

• Net income for Q1 2026 was $116.3 million ($1.16 per diluted share), or $149.9 million ($1.50 per share) excluding $42.5 million in merger-related expenses; assets reached $43.6 billion, loans $25.3 billion, and deposits $32.6 billion as of March 31, 2026.

• Completed mergers with American Bank Holding Corporation and Southwest Bancshares, Inc. in Q1 2026; announced and received regulatory approval for the pending Stellar Bancorp, Inc. acquisition, expected to close July 1, 2026.

• Repurchased approximately 837,000 shares for $57.1 million in Q1 2026 and declared a $0.60 dividend for Q2 2026.

• Recognized by Forbes and Newsweek as a top regional bank in 2026.

• Total assets grew 13.4% year-over-year, driven by acquisitions and organic growth.

Financial highlights

• Net interest income for Q1 2026 rose 21% year-over-year to $321.2 million, with net interest margin up to 3.51% from 3.14% year-over-year and 3.30% in Q4 2025.

• Noninterest income increased 12.5% to $46.5 million, mainly from higher fees and merger contributions.

• Noninterest expense for Q1 2026 was $217.3 million, up 55% year-over-year, primarily due to merger costs and higher salaries.

• Efficiency ratio was 59.16% (47.58% adjusted for merger expenses); cost of deposits was 1.32%.

• Net charge-offs were $41.3 million (0.67% of average loans), mainly in commercial and industrial loans.

Outlook and guidance

• Pending Stellar Bancorp acquisition expected to close July 1, 2026, with all regulatory approvals received.

• Management anticipates continued growth through acquisitions and internal expansion, with further benefits expected from the Stellar Bancorp merger.

• Positioned for continued growth in Texas and Oklahoma, benefiting from strong regional economies and population growth.