South Plains Financial, Inc. Reports Fourth Quarter and Year-End 2025 Financial Results
LUBBOCK, Texas, Jan. 26, 2026 (GLOBE NEWSWIRE) -- South Plains Financial, Inc. (NASDAQ:SPFI) ("South Plains" or the "Company"), the parent company of City Bank ("City Bank" or the "Bank"), today reported its financial results for the quarter and year ended December 31, 2025.
Fourth Quarter 2025 Highlights
Net income for the fourth quarter of 2025 was $15.3 million, compared to $16.3 million for the third quarter of 2025 and $16.5 million for the fourth quarter of 2024.
Diluted earnings per share for the fourth quarter of 2025 was $0.90, compared to $0.96 for the third quarter of 2025 and $0.96 for the fourth quarter of 2024.
Average cost of deposits for the fourth quarter of 2025 was 201 basis points, compared to 210 basis points for the third quarter of 2025 and 229 basis points for the fourth quarter of 2024.
Net interest margin, on a tax-equivalent basis, was 4.00% for the fourth quarter of 2025, compared to 4.05% for the third quarter of 2025 and 3.75% for the fourth quarter of 2024.
Return on average assets for the fourth quarter of 2025 was 1.36%, compared to 1.47% for the third quarter of 2025 and 1.53% for the fourth quarter of 2024.
Tangible book value (non-GAAP) per share was $29.05 as of December 31, 2025, compared to $28.14 as of September 30, 2025 and $25.40 as of December 31, 2024.
The consolidated total risk-based capital ratio, common equity tier 1 risk-based capital ratio, and tier 1 leverage ratio at December 31, 2025 were 17.26%, 14.45%, and 12.53%, respectively.
As previously reported, entered into a definitive agreement to acquire BOH Holdings, Inc. ("BOH") and its banking subsidiary Bank of Houston on December 1, 2025. At September 30, 2025, BOH had approximately $772 million in assets, $633 million in loans, and $629 million in deposits.
Full Year 2025 Highlights
Full year net income of $58.5 million in 2025, compared to $49.7 million in 2024.
Diluted earnings per share of $3.44 in 2025, compared to $2.92 in 2024.
Loans held for investment grew $89.4 million, or 2.9%, during 2025.
Total assets were $4.48 billion at December 31, 2025, compared to $4.23 billion at December 31, 2024.
Return on average assets of 1.33% for the full year 2025, compared to 1.17% for 2024.
Curtis Griffith, South Plains' Chairman and Chief Executive Officer, commented, "We delivered strong results for the full year 2025 highlighted by 17.8% diluted earnings per share growth, loan growth in line with our guidance, year-over-year net interest margin expansion of 33 basis points as we continue to closely manage our cost of funds, and grew our tangible book value per share over 14% to $29.05 at the end of 2025. We also made great strides executing our growth strategy having recruited outstanding lenders across our markets who we believe will bring new relationships to City Bank while also entering into the definitive agreement in December to acquire BOH and Bank of Houston which we believe will provide important scale in the fast-growing Houston market upon consummation of the acquisition. Taken together, we expect our loan growth to accelerate to a mid-to-high single digit rate in 2026 as we work to increase the earnings power of South Plains. We have laid the foundation to be a larger community bank which includes making the necessary investments in our technology, systems, and processes so that we can grow efficiently. While we have accomplished much, we are not standing still. We continue to look for attractive franchises, like BOH, as we believe we have the capacity to acquire another bank in a similar size range while also selectively recruiting high-quality lenders in our markets. I am very excited for what lies ahead for our employees, our customers, and our shareholders."
Results of Operations, Quarter Ended December 31, 2025
Net Interest Income
Net interest income was $43.0 million for the fourth quarter of 2025, compared to $43.0 million for the third quarter of 2025 and $38.5 million for the fourth quarter of 2024. Net interest margin, calculated on a tax-equivalent basis, was 4.00% for the fourth quarter of 2025, compared to 4.05% for the third quarter of 2025 and 3.75% for the fourth quarter of 2024. The average yield on loans was 6.79% for the fourth quarter of 2025, compared to 6.92% for the third quarter of 2025 and 6.69% for the fourth quarter of 2024. The average cost of deposits was 201 basis points for the fourth quarter of 2025, which is 9 basis points lower than the third quarter of 2025 and 28 basis points lower than the fourth quarter of 2024. Loan interest income for the third quarter of 2025 included $640 thousand in interest and fees recognized related to the resolution of credit workouts. This amount positively impacted the net interest margin by 6 basis points and the loan yield by 8 basis points during the third quarter of 2025.
Interest income was $63.4 million for the fourth quarter of 2025, compared to $64.5 million for the third quarter of 2025 and $61.3 million for the fourth quarter of 2024. Interest income decreased $1.1 million in the fourth quarter of 2025 from the third quarter of 2025, which was primarily attributable to a decrease of $1.1 million in interest income on loans. The decrease in interest income on loans was mainly due to the $640 thousand of loan interest and fees noted above and the decrease in short-term interest rates that occurred during the last 4 months of 2025. Interest income increased $2.1 million in the fourth quarter of 2025 compared to the fourth quarter of 2024. This increase was primarily due to an increase of average loans of $38.2 million and an increase of 10 basis points in loan yield during the period, resulting in growth of $1.6 million in loan interest income.
Interest expense was $20.5 million for the fourth quarter of 2025, compared to $21.5 million for the third quarter of 2025 and $22.8 million for the fourth quarter of 2024. Interest expense decreased $1.0 million compared to the third quarter of 2025 and decreased $2.3 million compared to the fourth quarter of 2024. The $1.0 million decrease was primarily a result of a 12 basis point decline in the cost of interest-bearing deposits in the fourth quarter of 2025 as compared to the third quarter of 2025 and the reduction in interest expense of $610 thousand as a result of the $50 million subordinated debt redemption in September 2025. The $2.3 million decrease was primarily a result of a 37 basis point decline in the cost of interest-bearing deposits, partially offset by an increase of $129.4 million in average interest-bearing deposits in the fourth quarter of 2025 as compared to the fourth quarter of 2024, and the reduction in interest expense of $610 thousand as a result of the $50 million subordinated debt redemption in September 2025.
Noninterest Income and Noninterest Expense
Noninterest income was $10.9 million for the fourth quarter of 2025, compared to $11.2 million for the third quarter of 2025 and $13.3 million for the fourth quarter of 2024. The decrease from the third quarter of 2025 was primarily due to a decrease of $185 thousand in mortgage banking revenues, mainly as a result of a decline in mortgage loans originated for sale during the fourth quarter. The decrease in noninterest income for the fourth quarter of 2025 as compared to the fourth quarter of 2024 was primarily due to a decrease of $2.6 million in mortgage banking revenues, mainly as a result of the change in the fair value adjustment of the mortgage servicing rights assets, a write-down of $665 thousand in the fourth quarter of 2025 compared to a write-up of $1.5 million in the fourth quarter of 2024, based on interest rate changes during the respective quarters.
Noninterest expense was $33.0 million for the fourth quarter of 2025, compared to $33.0 million for the third quarter of 2025 and $29.9 million for the fourth quarter of 2024. Changes from the third quarter of 2025 included a decrease of $1.0 million in personnel expense, based on lower incentive-based compensation expense, and an increase of $1.1 million in professional service expenses related primarily to approximately $500 thousand in acquisition related expenses and consulting on technology projects and other initiatives. The $3.1 million increase in noninterest expense for the fourth quarter of 2025 as compared to the fourth quarter of 2024 was largely the result of an increase of $1.0 million in personnel expenses mainly the result of annual salary adjustments, an increase in professional service expenses of $858 thousand primarily related to approximately $500 thousand in acquisition related expenses and consulting on technology projects and other initiatives, and an increase of $993 thousand in other noninterest expenses, mainly from the ineffectiveness related to fair value hedges on municipal securities.
Loan Portfolio and Composition
Loans held for investment were $3.14 billion as of December 31, 2025, compared to $3.05 billion as of September 30, 2025 and $3.06 billion as of December 31, 2024. The increase of $91.0 million, or 3.0%, during the fourth quarter of 2025 as compared to the third quarter of 2025 occurred primarily as a result of organic loan growth in multi-family property loans, direct energy loans, and other commercial loans. As of December 31, 2025, loans held for investment increased $89.5 million as of December 31, 2025 as compared to December 31, 2024, primarily as a result of organic growth broadly across the loan portfolio, partially offset by a decrease of $86.2 million in multi-family property loans.
Deposits and Borrowings
Deposits totaled $3.87 billion as of December 31, 2025, compared to $3.88 billion as of September 30, 2025 and $3.62 billion as of December 31, 2024. Deposits were essentially unchanged in the fourth quarter of 2025 from September 30, 2025. Deposits increased by $253.2 million, or 7.0%, at December 31, 2025 as compared to December 31, 2024. Noninterest-bearing deposits were $1.02 billion as of December 31, 2025, compared to $1.0 billion as of September 30, 2025 and $935.5 million as of December 31, 2024. Noninterest-bearing deposits represented 26.4% of total deposits as of December 31, 2025. The year-over-year change in total deposits was due to organic growth in both retail and commercial deposits.
Asset Quality
The Company recorded a provision for credit losses in the fourth quarter of 2025 of $1.8 million, compared to $500 thousand in the third quarter of 2025 and $1.2 million in the fourth quarter of 2024. The increase in provision for the fourth quarter of 2025 as compared to the third quarter of 2025 was largely attributable to the increase in loan balance noted above.
The ratio of allowance for credit losses to loans held for investment was 1.44% as of December 31, 2025, compared to 1.45% as of September 30, 2025 and 1.42% as of December 31, 2024.
The ratio of nonperforming assets to total assets was 0.26% as of December 31, 2025, compared to 0.26% as of September 30, 2025 and 0.58% as of December 31, 2024. Annualized net charge-offs were 0.10% for the fourth quarter of 2025, compared to 0.16% for the third quarter of 2025 and 0.11% for the fourth quarter of 2024.
Capital
Book value per share increased to $30.31 at December 31, 2025, compared to $29.41 at September 30, 2025. The change was primarily driven by $12.7 million of net income after dividends paid and by an increase in accumulated other comprehensive income of $3.4 million. The ratio of tangible common equity to tangible assets (non-GAAP) increased 36 basis points to 10.61% at December 31, 2025.
Conference Call
South Plains will host a conference call to discuss its fourth quarter and year-end 2025 financial results today, January 26, 2026, at 5:00 p.m., Eastern Time. Investors and analysts interested in participating in the call are invited to dial 1-877-407-9716 (international callers please dial 1-201-493-6779) approximately 10 minutes prior to the start of the call. A live audio webcast of the conference call and conference materials will be available on the Company's website at https://www.spfi.bank/news-events/events.
A replay of the conference call will be available within two hours of the conclusion of the call and can be accessed on the investor section of the Company's website as well as by dialing 1-844-512-2921 (international callers please dial 1-412-317-6671). The pin to access the telephone replay is 13757840. The replay will be available until February 9, 2026.
About South Plains Financial, Inc.
South Plains is the bank holding company for City Bank, a Texas state-chartered bank headquartered in Lubbock, Texas. City Bank is one of the largest independent banks in West Texas and has additional banking operations in the Dallas, El Paso, Greater Houston, the Permian Basin, and College Station, Texas markets, and the Ruidoso, New Mexico market. South Plains provides a wide range of commercial and consumer financial services to small and medium-sized businesses and individuals in its market areas. Its principal business activities include commercial and retail banking, along with investment, trust and mortgage services. Please visit https://www.spfi.bank for more information.
Non-GAAP Financial Measures
Some of the financial measures included in this press release are not measures of financial performance recognized in accordance with generally accepted accounting principles in the United States ("GAAP"). These non-GAAP financial measures include Tangible Book Value Per Share, Tangible Common Equity to Tangible Assets, and Pre-Tax, Pre-Provision Income. The Company believes these non-GAAP financial measures provide both management and investors a more complete understanding of the Company's financial position and performance. These non-GAAP financial measures are supplemental and are not a substitute for any analysis based on GAAP financial measures.
We classify a financial measure as being a non-GAAP financial measure if that financial measure excludes or includes amounts, or is subject to adjustments that have the effect of excluding or including amounts, that are included or excluded, as the case may be, in the most directly comparable measure calculated and presented in accordance with GAAP as in effect from time to time in the United States in our statements of income, balance sheets or statements of cash flows. Not all companies use the same calculation of these measures; therefore, this presentation may not be comparable to other similarly titled measures as presented by other companies.
A reconciliation of non-GAAP financial measures to GAAP financial measures is provided at the end of this press release.
Available Information
The Company routinely posts important information for investors on its web site (under www.spfi.bank and, more specifically, under the News & Events tab at www.spfi.bank/news-events/press-releases). The Company intends to use its web site as a means of disclosing material non-public information and for complying with its disclosure obligations under Regulation FD (Fair Disclosure) promulgated by the U.S. Securities and Exchange Commission (the "SEC"). Accordingly, investors should monitor the Company's web site, in addition to following the Company's press releases, SEC filings, public conference calls, presentations and webcasts.
The information contained on, or that may be accessed through, the Company's web site is not incorporated by reference into, and is not a part of, this document.
Forward Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect South Plains' current views with respect to future events and South Plains' financial performance. Any statements about South Plains' expectations, beliefs, plans, predictions, forecasts, objectives, assumptions or future events or performance are not historical facts and may be forward-looking. These statements are often, but not always, made through the use of words or phrases such as "anticipate," "believes," "can," "could," "may," "predicts," "potential," "should," "will," "estimate," "plans," "projects," "continuing," "ongoing," "expects," "intends" and similar words or phrases. South Plains cautions that the forward-looking statements in this press release are based largely on South Plains' expectations and are subject to a number of known and unknown risks and uncertainties that are subject to change based on factors which are, in many instances, beyond South Plains' control. Factors that could cause such changes include, but are not limited to, the expected impact of the proposed transaction between South Plains and BOH and on the combined entities' operations, financial condition, and financial results; the businesses of South Plains and BOH may not be combined successfully, or such combination may take longer to accomplish than expected; the cost savings from the proposed transaction may not be fully realized or may take longer to realize than expected; operating costs, customer loss and business disruption following the proposed transaction, including adverse effects on relationships with employees, may be greater than expected; regulatory approvals of the proposed transaction may not be obtained, or adverse conditions may be imposed in connection with regulatory approvals of the proposed transaction; the BOH shareholders may not approve the proposed transaction; the impact on us and our customers of a decline in general economic conditions and any regulatory responses thereto; slower economic growth rates or potential recession in the United States and our market areas uncertainty or perceived instability in the banking industry as a whole; increased competition for deposits in our market areas among traditional and nontraditional financial services companies, and related changes in deposit customer behavior; the impact of changes in market interest rates, whether due to a continuation of the elevated interest rate environment or further reductions in interest rates and a resulting decline in net interest income; the lingering inflationary pressures, and the risk of the resurgence of elevated levels of inflation, in the United States and our market areas; the uncertain impacts of ongoing quantitative tightening and current and future monetary policies of the Board of Governors of the Federal Reserve System; changes in unemployment rates in the United States and our market areas; adverse changes in customer spending, borrowing and savings habits; declines in commercial real estate values and prices; a deterioration of the credit rating for U.S. long-term sovereign debt or the impact of uncertain or changing political conditions, including federal government shutdowns and uncertainty regarding United States fiscal debt, deficit and budget matters; cyber incidents or other failures, disruptions or breaches of our operational or security systems or infrastructure, or those of our third-party vendors or other service providers, including as a result of cyber-attacks; severe weather, natural disasters, acts of war or terrorism, geopolitical instability, domestic civil unrest or other external events, including as a result of the impact of the policies of the current U.S. presidential administration or Congress; the impacts of tariffs, sanctions, and other trade policies of the United States and its global trading counterparts and the resulting impact on the Company and its customers; competition and market expansion opportunities; changes in non-interest expenditures or in the anticipated benefits of such expenditures; the risks related to the development, implementation, use and management of emerging technologies, including artificial intelligence and machine learnings; potential costs related to the impacts of climate change; current or future litigation, regulatory examinations or other legal and/or regulatory actions; changes in accounting principles and standards, including those related to loan loss recognition under the current expected credit loss, or CECL, methodology; and changes in applicable laws regulations, or policies in the United States. Additional information regarding these risks and uncertainties to which South Plains' business and future financial performance are subject is contained in South Plains' most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q on file with the SEC, including the sections entitled "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" of such documents, and other documents South Plains files or furnishes with the SEC from time to time, which are available on the SEC's website, www.sec.gov. Actual results, performance or achievements could differ materially from those contemplated, expressed, or implied by the forward-looking statements due to additional risks and uncertainties of which South Plains is not currently aware or which it does not currently view as, but in the future may become, material to its business or operating results. Due to these and other possible uncertainties and risks, the Company can give no assurance that the results contemplated in the forward-looking statements will be realized and readers are cautioned not to place undue reliance on the forward-looking statements contained in this press release. Any forward-looking statements presented herein are made only as of the date of this press release, and South Plains does not undertake any obligation to update or revise any forward-looking statements to reflect changes in assumptions, new information, the occurrence of unanticipated events, or otherwise, except as required by applicable law. All forward-looking statements, express or implied, included in the press release are qualified in their entirety by this cautionary statement.
Contact:
Mikella Newsom, Chief Risk Officer and Secretary
(866) 771-3347
Source: South Plains Financial, Inc.
South Plains Financial, Inc.Consolidated Financial Highlights, (Unaudited)(Dollars in thousands, except share data)
As of and for the quarter ended
December 31, 2025
September 30, 2025
June 30, 2025
March 31, 2025
December 31, 2024
Selected Income Statement Data:
Interest income
$
63,421
$
64,520
$
64,135
$
59,922
$
61,324
Interest expense
20,471
21,501
21,632
21,395
22,776
Net interest income
42,950
43,019
42,503
38,527
38,548
Provision for credit losses
1,775
500
2,500
420
1,200
Noninterest income
10,934
11,165
12,165
10,625
13,319
Noninterest expense
33,023
33,024
33,543
33,030
29,948
Income tax expense
3,832
4,342
4,020
3,408
4,222
Net income
15,254
16,318
14,605
12,294
16,497
Per Share Data (Common Stock):
Net earnings, basic
$
0.94
$
1.00
$
0.90
$
0.75
$
1.01
Net earnings, diluted
0.90
0.96
0.86
0.72
0.96
Cash dividends declared and paid
0.16
0.16
0.15
0.15
0.15
Book value
30.31
29.41
27.98
27.33
26.67
Tangible book value (non-GAAP)
29.05
28.14
26.70
26.05
25.40
Weighted average shares outstanding, basic
16,248,336
16,241,695
16,231,627
16,415,862
16,400,361
Weighted average shares outstanding, dilutive
16,996,517
16,990,546
16,886,993
17,065,599
17,161,646
Shares outstanding at end of period
16,293,577
16,247,839
16,230,475
16,235,647
16,455,826
Selected Period End Balance Sheet Data:
Cash and cash equivalents
$
552,439
$
635,046
$
470,496
$
536,300
$
359,082
Investment securities
567,540
571,138
570,000
571,527
577,240
Total loans held for investment
3,144,502
3,053,503
3,098,978
3,075,860
3,055,054
Allowance for credit losses
45,131
44,125
45,010
42,968
43,237
Total assets
4,480,500
4,479,437
4,363,674
4,405,209
4,232,239
Interest-bearing deposits
2,850,560
2,831,642
2,740,179
2,826,055
2,685,366
Noninterest-bearing deposits
1,023,517
1,049,501
998,759
966,464
935,510
Total deposits
3,874,077
3,881,143
3,738,938
3,792,519
3,620,876
Borrowings
60,493
60,493
111,799
110,400
110,354
Total stockholders' equity
493,837
477,802
454,074
443,743
438,949
Summary Performance Ratios:
Return on average assets (annualized)
1.36%
1.47%
1.34%
1.16%
1.53%
Return on average equity (annualized)
12.46%
13.89%
13.05%
11.30%
14.88%
Net interest margin (1)
4.00%
4.05%
4.07%
3.81%
3.75%
Yield on loans
6.79%
6.92%
6.99%
6.67%
6.69%
Cost of interest-bearing deposits
2.75%
2.87%
2.91%
2.93%
3.12%
Efficiency ratio
61.02%
60.69%
61.11%
66.90%
57.50%
Summary Credit Quality Data:
Nonperforming loans
$
9,805
$
9,709
$
10,463
$
6,467
$
24,023
Nonperforming loans to total loans held for investment
0.31%
0.32%
0.34%
0.21%
0.79%
Other real estate owned
$
1,749
$
1,827
$
535
$
600
$
530
Nonperforming assets to total assets
0.26%
0.26%
0.25%
0.16%
0.58%
Allowance for credit losses to total loans held for investment
1.44%
1.45%
1.45%
1.40%
1.42%
Net charge-offs to average loans outstanding (annualized)
0.10%
0.16%
0.06%
0.07%
0.11%
As of and for the quarter ended
December 31, 2025
September 30, 2025
June 30, 2025
