Prosperity Bancshares (PB) Q2 2025 earnings summary

Executive summary

• Q2 2025 net income rose 21.1% year-over-year to $135.2 million, with EPS at $1.42 and strong margin expansion.

• Announced a definitive agreement to acquire American Bank Holding Corporation for $321.5 million in stock, expanding presence in South and Central Texas.

• Total assets were $38.4 billion, loans $22.2 billion, and deposits $27.5 billion as of June 30, 2025.

• Maintains strong presence in Texas and Oklahoma, ranked #2 in deposit market share in Texas.

• Completed Lone Star State Bancshares acquisition in April 2024.

Financial highlights

• Net interest income for Q2 2025 was $267.7 million, up 3.5% year-over-year; net interest margin rose to 3.18%, up 24 basis points.

• Noninterest income was $43 million, down 6.6% year-over-year, mainly due to lower securities gains.

• Noninterest expense fell 9.3% to $138.6 million, reflecting lower regulatory and merger-related costs.

• Declared a $0.58 cash dividend for Q3 2025.

• 10-year CAGR: loans 9.1%, deposits 4.8%, assets 6.3%.

Outlook and guidance

• The American Bank acquisition is expected to close in Q4 2025 or Q1 2026, subject to regulatory and shareholder approvals.

• Management expects continued growth in Texas and Oklahoma, with positive economic tailwinds and strong population and job growth.

• Net interest margin projected at 3.25%–3.3% for 2025, with potential expansion if rates remain stable.

• Non-interest expense for Q3 2025 expected in the range of $141–$144 million.

• Fee income run rate updated to $38–$40 million per quarter.