Third Coast Bancshares, Inc. Reports 2025 Fourth Quarter and Full Year Financial Results
Record Annual Net Income of $66.3 million
Record Annual Diluted Earnings Per Share of $3.79
Year Over Year Book Value grew 16.8% and Tangible Book Value(1) grew 17.7%
HOUSTON, Jan. 21, 2026 /PRNewswire/ -- Third Coast Bancshares, Inc. (NYSE & NYSE Texas: TCBX) (the "Company," "Third Coast," "we," "us," or "our"), the bank holding company for Third Coast Bank (the "Bank"), today reported its 2025 fourth quarter and full year financial results.
2025 Fourth Quarter Financial Highlights
Return on average assets of 1.36% annualized for the fourth quarter of 2025 compared to 1.41% annualized for the third quarter of 2025 and 1.13% annualized for the fourth quarter of 2024.
Net interest margin remained consistent at 4.10% for the fourth quarter of 2025 and the third quarter of 2025, compared to 3.71% for the fourth quarter of 2024.
Net income for the fourth quarter of 2025 totaled $17.9 million, or $1.21 and $1.02 per basic and diluted share, respectively, compared to $18.1 million, or $1.22 and $1.03 per basic and diluted share, respectively, for the third quarter of 2025 and $13.7 million, or $0.92 and $0.79 per basic and diluted share, respectively, for the fourth quarter of 2024.
Efficiency ratio of 57.90% for the fourth quarter of 2025 compared to 53.03% for the third quarter of 2025 and 58.80% for the fourth quarter of 2024.
Gross loans grew to $4.39 billion as of December 31, 2025, from $4.17 billion reported as of September 30, 2025.
Book value per share and tangible book value per share(1) increased to $33.47 and $32.12, respectively, as of December 31, 2025, compared to $32.25 and $30.91, respectively, as of September 30, 2025 and $28.65 and $27.29, respectively, as of December 31, 2024.
2025 Full Year Financial and Operational Highlights
Net income totaled $66.3 million, or $4.45 and $3.79 per basic and diluted share, respectively, for the year ended December 31, 2025, compared to $47.7 million, or $3.14 and $2.78 per basic and diluted share, respectively, for the year ended December 31, 2024.
Total assets increased $398.3 million to $5.34 billion as of December 31, 2025, or 8.1% over the $4.94 billion reported as of December 31, 2024.
Gross loans grew $428.3 million to $4.39 billion as of December 31, 2025, 10.8% more than the $3.97 billion reported as of December 31, 2024.
Deposits increased $316.4 million to $4.63 billion as of December 31, 2025, or 7.3% over the $4.31 billion reported as of December 31, 2024.
Transfer of listing of common stock to the New York Stock Exchange and NYSE Texas.
"We are very pleased with our fourth-quarter and full-year 2025 performance, which delivered exceptional loan growth, materially higher fee income than previously guided, and a stable net interest margin that outperformed expectations," said Bart Caraway, Founder, Chairman, President & Chief Executive Officer of Third Coast. "These strong results reflect record net income of $66.3 million and record annual diluted earnings per share of $3.79. It demonstrates our consistent execution and the transformation of our company into a high-performing institution that is doing exactly what we said we would do."
Operating Results
Net Income and Earnings Per Share
Net income totaled $17.9 million for the fourth quarter of 2025, compared to $18.1 million for the third quarter of 2025 and $13.7 million for the fourth quarter of 2024. Net income available to common shareholders totaled $16.7 million for the fourth quarter of 2025, compared to $16.9 million for the third quarter of 2025 and $12.5 million for the fourth quarter of 2024. The quarter-over-quarter decrease from the third quarter of 2025 was primarily due to merger-related expenses attributing to an increase in legal and professional expenses, and an increase in salaries and employee benefits related to sign on bonuses and severance expenses, partially offset by an increase in net interest income and an increase in non-margin loan fees. Dividends on our Series A Convertible Non-Cumulative Preferred Stock ("Series A Preferred Stock") totaled $1.2 million for each of the quarters ended December 31, 2025, September 30, 2025 and December 31, 2024.
Basic and diluted earnings per share were $1.21 per share and $1.02 per share, respectively, in the fourth quarter of 2025, compared to $1.22 per share and $1.03 per share, respectively, in the third quarter of 2025 and $0.92 per share and $0.79 per share, respectively, in the fourth quarter of 2024.
Net Interest Margin and Net Interest Income
The net interest margin for the fourth quarter of 2025 remained consistent with the third quarter of 2025 at 4.10%, compared to 3.71% for the fourth quarter of 2024. The yield on loans for the fourth quarter of 2025 was 7.52%, compared to 7.79% for the third quarter of 2025 and 7.68% for the fourth quarter of 2024. The cost of interest-bearing deposits for the fourth quarter of 2025 was 3.73%, compared to 3.98% for the third quarter of 2025 and 4.33% for the fourth quarter of 2024.
Net interest income totaled $52.2 million for the fourth quarter of 2025, an increase of 2.7% from $50.8 million for the third quarter of 2025 and an increase of 20.2% from $43.4 million for the fourth quarter of 2024. Interest income totaled $92.1 million for the fourth quarter of 2025, a decrease of 0.4% from $92.5 million for the third quarter of 2025 and an increase of 7.7% from $85.5 million for the fourth quarter of 2024. The quarter-over-quarter increase in net interest income primarily resulted from a decrease in interest expense. Interest expense was $39.9 million for the fourth quarter of 2025, a decrease of $1.8 million, or 4.2%, from $41.7 million for the third quarter of 2025 and a decrease of $2.2 million, or 5.2%, from $42.1 million for the fourth quarter of 2024, primarily resulting from an reduction in rates paid on interest-bearing demand deposits.
Noninterest Income and Noninterest Expense
Noninterest income totaled $4.3 million for the fourth quarter of 2025, compared to $3.6 million for the third quarter of 2025 and $2.9 million for the fourth quarter of 2024. The increase in noninterest income was primarily due to an increase in non-margin loan fees during the fourth quarter of 2025.
Noninterest expense increased to $32.7 million for the fourth quarter of 2025, compared to $28.9 million for the third quarter of 2025 and $27.2 million for the fourth quarter of 2024. The quarter-over-quarter increase in noninterest expense was primarily due to merger-related expenses. During the fourth quarter of 2025, the Company recorded merger-related expenses of $1.0 million in legal and professional expenses. Additionally, the Company recorded $1.5 million in salaries and employee benefits attributable to sign on bonuses and severance expenses during the fourth quarter of 2025. At December 31, 2025, the number of employees was 412, compared to 398 at September 30, 2025.
The efficiency ratio was 57.90% for the fourth quarter of 2025, compared to 53.03% for the third quarter of 2025 and 58.80% for the fourth quarter of 2024.
Balance Sheet Highlights
Loan Portfolio and Composition
For the quarter ended December 31, 2025, gross loans increased to $4.39 billion, an increase of $229.6 million, or 5.5%, from $4.17 billion as of September 30, 2025, and an increase of $428.3 million, or 10.8%, from $3.97 billion as of December 31, 2024. Commercial and industrial loans, real estate loans and municipal and other loans accounted for the majority of the loan growth for the fourth quarter of 2025, with commercial and industrial loans increasing $134.6 million, real estate loans increasing $44.8 million and municipal loans increasing $50.0 million from the third quarter of 2025.
Asset Quality
Nonperforming loans at December 31, 2025 were $21.5 million, compared to $21.7 million at September 30, 2025 and $27.9 million at December 31, 2024. As of December 31, 2025, the nonperforming loans to total loans ratio was 0.49%, compared to 0.52% as of September 30, 2025 and 0.70% as of December 31, 2024.
The provision for credit loss recorded for the fourth quarter of 2025 was $2.2 million, and the allowance for credit losses of $43.9 million represented 1.00% of the $4.39 billion in gross loans outstanding as of December 31, 2025. The provision for credit loss recorded for the third quarter of 2025 was $2.8 million, and the allowance for credit losses of $42.6 million represented 1.02% of the $4.17 billion in gross loans outstanding as of September 30, 2025.
The Company recorded net charge-offs of $844,000 and $879,000 for the three months ended December 31, 2025 and December 31, 2024, respectively. On a full year basis, net charge-offs were $3.6 million and $3.4 million in 2025 and 2024, respectively.
Deposits and Composition
Deposits totaled $4.63 billion as of December 31, 2025, an increase of 5.8% from $4.37 billion as of September 30, 2025, and an increase of 7.3% from $4.31 billion as of December 31, 2024. Noninterest-bearing demand deposits increased from $450.0 million as of September 30, 2025, to $495.0 million as of December 31, 2025 and represented 10.7% and 10.3% of total deposits as of December 31, 2025 and September 30, 2025, respectively. As of December 31, 2025, interest-bearing demand deposits increased $235.5 million, or 7.5%, partially offset by a decrease in time deposits of $25.7 million, or 3.3%, and a decrease in savings accounts of $573,000, or 2.6%, respectively, from September 30, 2025.
The average cost of deposits was 3.33% for the fourth quarter of 2025, representing a 23-basis point decrease from the third quarter of 2025 and a 50-basis point decrease from the fourth quarter of 2024. The decreases were primarily due to the reduction in rates paid on interest-bearing demand deposits.
Earnings Conference Call
Third Coast has scheduled a conference call to discuss its 2025 fourth quarter and fiscal year results, which will be broadcast live over the Internet, on Thursday, January 22, 2026, at 11:00 a.m. Eastern Time / 10:00 a.m. Central Time. To participate in the call, dial 201-389-0869 and ask for the Third Coast Bancshares, Inc. call at least 10 minutes prior to the start time, or access it live over the Internet at https://ir.thirdcoast.bank/events-and-presentations/events/. For those who cannot listen to the live call, a replay will be available through January 29, 2026, and may be accessed by dialing 201-612-7415 and using passcode 13752290#. Also, an archive of the webcast will be available shortly after the call at https://ir.thirdcoast.bank/events-and-presentations/events/ for 90 days.
About Third Coast Bancshares, Inc.
Third Coast Bancshares, Inc. is a commercially focused, Texas-based bank holding company operating primarily in the Greater Houston, Dallas-Fort Worth, and Austin-San Antonio markets through its wholly owned subsidiary, Third Coast Bank. Founded in 2008 in Humble, Texas, Third Coast Bank conducts banking operations through 19 branches encompassing the four largest metropolitan areas in Texas. Please visit https://www.thirdcoast.bank for more information.
Forward Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that are subject to risks and uncertainties and are made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements reflect our current views with respect to, among other things, future events and our financial performance. These statements are often, but not always, made through the use of words or phrases such as "may," "should," "could," "predict," "potential," "believe," "looking ahead," "will likely result," "expect," "continue," "will," "anticipate," "seek," "estimate," "intend," "plan," "projection," "would" and "outlook," or the negative version of those words or other comparable words or phrases 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. 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: interest rate risk and fluctuations in interest rates; market conditions and economic trends generally and in the banking industry; our ability to maintain important deposit relationships; our ability to grow or maintain our deposit base; our ability to implement our expansion strategy; our ability to pay dividends on our Series A Preferred Stock; credit risk associated with our business; economic conditions affecting the real estate market; prepayment risks associated with commercial real estate loans; liquidity risks in the securitization market; operational risks related to the administration of securitized assets; changes in key management personnel; the occurrence of any event, change or other circumstance that could give rise to the right of one or both of the parties to terminate the definitive merger agreement providing for the acquisition of Keystone Bancshares, Inc. ("Keystone") by Third Coast; the outcome of any legal proceedings that may be instituted against Third Coast or Keystone; the possibility that the transaction does not close when expected or at all because required regulatory, shareholder or other approvals and other conditions to closing are not received or satisfied on a timely basis or at all (and the risk that such approvals may result in the imposition of conditions that could adversely affect the combined company or the expected benefits of the transaction); the risk that the benefits from the transaction may not be fully realized or may take longer to realize than expected, including as a result of changes in, or problems arising from, general economic and market conditions, interest and exchange rates, monetary policy, laws and regulations and their enforcement, and the degree of competition in the geographic and business areas in which Third Coast and Keystone operate; disruption to the parties' businesses as a result of the announcement and pendency of the transaction; the risk that the integration of each party's operations will be materially delayed or will be more costly or difficult than expected or that the parties are otherwise unable to successfully integrate each party's businesses into the other's businesses; the possibility that the transaction may be more expensive to complete than anticipated, including as a result of unexpected factors or events; reputational risk and potential adverse reactions of Third Coast's or Keystone's customers, suppliers, employees or other business partners, including those resulting from the announcement or completion of the transaction; the dilution caused by Third Coast's issuance of additional shares of its common stock in connection with the transaction; a material adverse change in the financial condition of Third Coast or Keystone; the diversion of management's attention and time from ongoing business operations and opportunities on merger-related matters; and other factors that may affect future results of Third Coast and Keystone including changes in asset quality and credit risk, the inability to sustain revenue and earnings growth, changes in interest rates and capital markets, inflation, customer borrowing, repayment, investment and deposit practices, the impact, extent and timing of technological changes, capital management activities and other actions of the Board of Governors of the Federal Reserve System and legislative and regulatory actions and reforms. For a discussion of additional factors that could cause our actual results to differ materially from those described in the forward-looking statements, please see the risk factors discussed in our Annual Report on Form 10-K for the year ended December 31, 2024 filed with the U.S. Securities and Exchange Commission (the "SEC"), and our other filings with the SEC.
The foregoing factors should not be construed as exhaustive and should be read together with the other cautionary statements included in this press release. 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 what we anticipate. Accordingly, you should not place undue reliance on any such forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made, 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. New factors emerge from time to time, and it is not possible for us to predict which will arise. In addition, we cannot assess the impact of each factor on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements.
Non-GAAP Financial Measures
This press release contains certain non-GAAP financial measures, including Tangible Common Equity, Tangible Book Value Per Share, Tangible Common Equity to Tangible Assets and Return on Average Tangible Common Equity, which are supplemental measures that are not required by, or are not presented in accordance with GAAP. Please refer to the table titled "GAAP Reconciliation and Management's Explanation of Non-GAAP Financial Measures" at the end of this press release for a reconciliation of these non-GAAP financial measures.
____________________________
(1) Non-GAAP financial measure. Please refer to the table titled "GAAP Reconciliation and Management's Explanation of Non-GAAP Financial Measures" at the end of this news release for a reconciliation of these non-GAAP financial measures.
Third Coast Bancshares, Inc. and Subsidiary
Financial Highlights
(unaudited)
2025
2024
(Dollars in thousands)
December 31
September 30
June 30
March 31
December 31
ASSETS
Cash and cash equivalents:
Cash and due from banks
$
175,202
$
116,383
$
113,141
$
218,990
$
371,157
Federal funds sold
6,027
6,629
5,815
110,379
50,045
Total cash and cash equivalents
181,229
123,012
118,956
329,369
421,202
Interest bearing time deposits in other banks
267
265
262
359
356
Investment securities available-for-sale
383,192
376,719
355,753
397,442
384,025
Investment securities held to maturity
192,008
206,037
206,065
-
-
Loans held for investment
4,394,751
4,165,116
4,079,736
3,988,039
3,966,425
Less: allowance for credit losses
(43,949)
(42,563)
(40,035)
(40,456)
(40,304)
Loans held for investment, net
4,350,802
4,122,553
4,039,701
3,947,583
3,926,121
Accrued interest receivable
29,236
29,537
27,736
26,752
25,820
Premises and equipment, net
24,789
24,718
24,908
25,669
26,230
Other real estate owned
8,388
8,388
8,580
8,752
862
Bank-owned life insurance
76,357
75,547
74,761
74,018
68,341
Non-marketable securities, at cost
16,424
26,157
18,761
15,994
15,980
Deferred tax asset, net
4,440
6,989
8,646
9,176
11,445
Derivative assets
2,544
2,803
3,059
3,052
6,479
Right-of-use assets - operating leases
17,066
17,677
18,769
19,370
19,863
Goodwill and other intangible assets
18,680
18,720
18,761
18,801
18,841
Other assets
35,337
22,686
19,053
20,652
16,881
Total assets
$
5,340,759
$
5,061,808
$
4,943,771
$
4,896,989
$
4,942,446
LIABILITIES
Deposits:
Noninterest bearing
$
495,000
$
450,013
$
440,964
$
448,542
$
602,082
Interest bearing
4,131,888
3,922,728
3,839,905
3,800,001
3,708,416
Total deposits
4,626,888
4,372,741
4,280,869
4,248,543
4,310,498
Accrued interest payable
5,957
7,153
6,691
7,044
6,281
Derivative liabilities
3,142
3,521
3,779
3,527
8,660
Lease liability - operating leases
18,130
18,735
19,835
20,425
20,900
Other liabilities
36,775
32,040
24,745
25,979
23,754
Line of credit - Senior Debt
37,875
32,875
30,875
30,875
30,875
Note payable - Subordinated Debentures, net
80,965
80,913
80,862
80,810
80,759
Total liabilities
4,809,732
4,547,978
4,447,656
4,417,203
4,481,727
SHAREHOLDERS' EQUITY
Series A Convertible Non-Cumulative Preferred Stock
69
69
69
69
69
Series B Convertible Perpetual Preferred Stock
-
-
-
-
-
Common stock
13,970
13,958
13,930
13,904
13,848
Common stock - non-voting
-
-
-
-
-
Additional paid-in capital
323,929
323,491
322,972
322,456
321,696
Retained earnings
183,238
166,537
149,677
134,115
121,697
Accumulated other comprehensive income
10,920
10,874
10,566
10,341
4,508
Treasury stock, at cost
(1,099)
(1,099)
(1,099)
(1,099)
(1,099)
Total shareholders' equity
531,027
513,830
496,115
479,786
460,719
Total liabilities and shareholders' equity
$
5,340,759
$
5,061,808
$
4,943,771
$
4,896,989
$
4,942,446
Third Coast Bancshares, Inc. and Subsidiary
Financial Highlights
(unaudited)
Three Months Ended
Years Ended
2025
2024
2025
2024
(Dollars in thousands, except per share data)
December 31
September 30
June 30
March 31
December 31
December 31
December 31
INTEREST INCOME:
Loans, including fees
$
81,368
$
82,054
$
79,706
$
73,087
$
76,017
$
316,215
$
295,259
Investment securities available-for-sale
6,464
6,289
5,505
5,693
4,939
23,951
17,055
Investment securities held-to-maturity
2,681
2,882
1,607
-
-
7,170
-
Federal funds sold and other
1,586
1,278
1,844
1,986
4,580
6,694
16,042
Total interest income
92,099
92,503
88,662
80,766
85,536
354,030
328,356
INTEREST EXPENSE:
Deposit accounts
37,530
39,030
37,535
36,226
40,233
150,321
159,748
FHLB advances and other borrowings
2,372
2,624
1,753
1,743
1,865
8,492
7,850
Total interest expense
39,902
41,654
39,288
37,969
42,098
158,813
167,598
Net interest income
52,197
50,849
49,374
42,797
43,438
195,217
160,758
Provision for credit losses
2,245
2,763
2,130
450
1,156
7,588
5,701
Net interest income after credit loss expense
49,952
48,086
47,244
42,347
42,282
187,629
155,057
NONINTEREST INCOME:
Service charges and fees
3,518
2,839
2,125
2,277
1,772
10,759
6,935
Earnings on bank-owned life insurance
811
786
743
677
662
3,017
2,480
(Loss) gain on sale of investment securities available-for-sale
(272)
-
(110)
(228)
196
(610)
(4)
Gain on sale of SBA loans
-
-
44
30
-
74
30
Other
204
10
(152)
351
243
413
1,180
