PB Filings — Prosperity Bancshares, Inc. - FilingSpy
PB
Prosperity Bancshares, Inc.
A community banking company running hundreds of Prosperity Bank locations across Texas and Oklahoma, offering loans, deposits, trust, wealth management, and digital banking to consumers and businesses. It was formed in 1983 in Houston to buy a single bank in the small town of Edna, Texas, whose roots go back to 1949. The firm didn't even carry the "Prosperity" name until 1992, when "First Bank" became "First Prosperity Bank" before settling on "Prosperity Bank" in 2001.
Net income rose 45% sequentially to $168.6M as merger costs fell and the net interest margin held above 3.4%.
The two acquisitions that closed in early 2026 are now contributing to earnings, not just costs. rose 25.9% to $391.3M and reached $1.67, as the held at 3.47% and merger-related charges fell sharply from the prior quarter. The Stellar Bancorp deal closed right after the quarter ended, adding another layer of growth and integration risk.
Key takeaways
rose 45.0% from the prior quarter to $168.6M, as the $42.5M in merger costs that depressed Q1 2026 earnings did not repeat at the same scale.
before provision rose 23.5% to $330.6M, driven by the addition of loan portfolios from the American Bank Holding Corporation and Southwest Bancshares, Inc. acquisitions and a 29-basis-point expansion in the to 3.47%.
Noninterest income rose 41.2% to $60.7M, boosted by the acquired operations and an $8.2M gain on the exchange of Visa Class B-2 stock, net of securities sales.
Section summaries
Management's Discussion and Analysis
Net income rose to $168.6M in Q2 2026, driven by 23.5% higher net interest income from recent acquisitions and asset repricing.
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before provision grew 23.5% to $330.6M in Q2 2026, with expanding 29 to 3.47%, aided by the American and Southwest mergers and lower other borrowing costs.
Noninterest expense rose 27.1% to $176.2M, reflecting the larger operating base from the two acquisitions, but fell 18.9% from the prior quarter as merger-related costs subsided.
rose to $43.5M, including a $39.2M increase in commercial and industrial charge-offs, while the grew 14.7% from year-end to $382.8M with no provision recorded in the first half of 2026.
The company completed the Stellar Bancorp acquisition on July 1, 2026, for $578.66M in cash and 19.4M shares, and reported a of 15.94%.
What changed
The Q1 2026 filing flagged whether the $42.5M in merger-related costs was a one-quarter event: noninterest expense fell to $176.2M in Q2 from $217.3M in Q1, confirming that the bulk of those charges were concentrated in the first quarter.
The Q1 2026 filing flagged the trajectory of , which had risen to $41.3M: net charge-offs increased further to $43.5M in Q2, with the increase again concentrated in commercial and industrial credits.
The Q1 2026 filing flagged the pending Stellar Bancorp acquisition: the deal closed on July 1, 2026, for $578.66M in cash and 19.4M shares, and its financial impact will begin to appear in the Q3 2026 results.
The , which had expanded to 3.51% in Q1 2026 aided by acquisition accounting, settled at 3.47% in Q2, suggesting the initial accretion benefit is normalizing as the acquired portfolios are integrated.
What to watch
Whether , which reached $43.5M in Q2 and are concentrated in commercial and industrial loans, lead to a in the second half of 2026 after two quarters with none.
The integration and financial impact of the Stellar Bancorp acquisition, which closed July 1, 2026, on the loan portfolio, deposit base, and expense run rate, and whether it triggers a new wave of merger-related costs in Q3.
The trajectory as the initial accretion benefit from the American and Southwest acquisitions fades and the Stellar portfolio is added, to see whether the core spread stabilizes above 3.4%.
Deposit balance and cost trends as the combined entity absorbs the Stellar funding base, and whether the larger balance sheet changes the company's interest rate sensitivity.
Total loans increased 14.8% from year-end 2025 to $25.03B, and total deposits rose 14.5% to $32.60B, both primarily due to the American and Southwest acquisitions.
Noninterest income rose 41.2% to $60.7M in Q2 2026, boosted by the mergers and an $8.2M gain on Visa Class B-2 stock exchange net of securities sales.
Noninterest expense increased 27.1% to $176.2M in Q2 2026, driven by higher salaries and benefits and the addition of operating costs from the acquired American and Southwest entities.
The allowance for credit losses on loans grew 14.7% from year-end to $382.8M, with no provision recorded in the first half of 2026; rose to $43.5M, including a $39.2M increase in commercial and industrial charge-offs.
The company completed the Stellar Bancorp acquisition on July 1, 2026, for $578.66M in cash and 19.4M shares, and maintained strong capital ratios with a CET1 ratio of 15.94%.
Quantitative and Qualitative Disclosures About Market Risk
The Company manages market risk, which for the Company is primarily interest rate risk, through its Asset Liability Committee consisting of senior officers of the Company, in accordance with policies approved by the Company’s Board of Directors. The Company uses simulation analy…
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The Company manages market risk, which for the Company is primarily interest rate risk, through its Asset Liability Committee consisting of senior officers of the Company, in accordance with policies approved by the Company’s Board of Directors.
The Company uses simulation analysis to examine the potential effects of market changes on net interest income and market value. The Company considers macroeconomic variables, Company strategy, liquidity and other factors as it quantifies market risk. See Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Interest Rate Sensitivity and Market Risk” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025, filed on February 26, 2026, (the “2025 Form 10-K”), for further discussion. There have been no material changes in the Company’s market risk exposures that would affect the quantitative and qualitative disclosures from those disclosed in the 2025 Form 10-K and presented as of December 31, 2025.
Bancshares and the Bank are defendants, from time to time, in legal actions arising from transactions conducted in the ordinary course of business. After consultations with legal counsel, Bancshares and the Bank believe that the ultimate liability, if any, arising from such acti…
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Bancshares and the Bank are defendants, from time to time, in legal actions arising from transactions conducted in the ordinary course of business. After consultations with legal counsel, Bancshares and the Bank believe that the ultimate liability, if any, arising from such actions will not have a material adverse effect on their financial statements.
There have been no material changes in the Company’s risk factors from those disclosed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025.
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There have been no material changes in the Company’s risk factors from those disclosed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025.