Highlights

  • Third quarter 2026 net income was $141.5 million, or $1.18 per diluted share, compared with $137.6 million a year earlier.
  • Prosperity completed the Stellar Bancorp merger on July 1, 2026 and incurred $69.7 million of merger related expenses.
  • Total assets were $54.101 billion at September 30, 2026, and net interest margin on a tax equivalent basis was 3.73%.
  • The Board approved a fourth quarter 2026 dividend of $0.64 per share, an increase of $0.04 from the prior quarter.

Prosperity Bancshares, Inc. (NYSE:PB) shares were trading at USD 70.17 on October 28, 2026, up 0.76%, with a relative volume at time of 2.85. The Houston-based bank holding company completed the Stellar Bancorp merger on July 1, 2026 and reported third quarter 2026 earnings and a dividend increase on October 28.

Prosperity Bancshares is incorporated in Texas and is the parent company of Prosperity Bank, with its offices in Houston, Texas. Prosperity Bancshares completed three mergers in 2026: American Bank Holding Corporation on January 1, Southwest Bancshares, Inc. on February 1 and Stellar Bancorp, Inc. on July 1.

Third Quarter 2026 Results

Net income was $141.5 million for the quarter ended September 30, 2026, compared with $137.6 million for the same period in 2025. Net income per diluted common share was $1.18, compared with $1.45. The company cited the mergers, merger related expenses and a $5.0 million out of state tax settlement. The effective tax rate was 24.4%.

Excluding merger related expenses and other non-recurring items, a non-GAAP measure, net income was $200.8 million and earnings per diluted common share was $1.67. Annualized return on average assets was 1.06%.

Net interest income before provision for credit losses was $443.0 million, compared with $273.4 million a year earlier. Noninterest income was $52.7 million, compared with $41.2 million. Noninterest expense was $308.6 million, compared with $138.6 million. There was no provision for credit losses in the third quarters of 2026 and 2025.

For the nine months ended September 30, 2026, net income was $426.3 million, or $3.99 per diluted common share, compared with $402.9 million, or $4.23.

Balance Sheet, Asset Quality and Capital

Total assets were $54.101 billion at September 30, 2026, compared with $38.330 billion at September 30, 2025. Loans were $32.060 billion, and deposits were $41.231 billion. Noninterest-bearing deposits were $13.8 billion, representing 33.6% of total deposits.

Nonperforming assets totaled $193.9 million, or 0.41% of quarterly average interest-earning assets, compared with $119.6 million, or 0.36%, at September 30, 2025. The allowance for credit losses on loans and off-balance sheet credit exposures was $629.6 million, and the allowance for credit losses on loans was $592.0 million, or 1.85% of total loans. Net charge-offs were $4.4 million, compared with $6.5 million a year earlier.

Mergers, Dividend and Repurchases

On July 1, 2026, Prosperity completed the acquisition of Stellar and Stellar Bank, which operated 52 banking offices. Prosperity issued 19,371,499 shares of common stock and paid approximately $578.66 million in cash for all outstanding Stellar shares. The transaction resulted in goodwill of $898.2 million as of September 30, 2026, and $184.0 million of core deposit intangibles. The company said it remains focused on completing the operational integration of Texas Partners Bank and Stellar Bank.

The company completed the operational integration of American Bank during the third quarter.

The Board approved an increase in the fourth quarter 2026 dividend to $0.64 per share from $0.60 per share, an increase of 6.67%. The company described it as the 23rd consecutive annual dividend increase, payable January 4, 2027 to shareholders as of December 15, 2026.

Under the stock repurchase program announced January 26, 2026, which allows up to 5%, or approximately 4.87 million shares, to be acquired through January 26, 2027, Prosperity repurchased approximately 457 thousand shares for $31.8 million during the third quarter.

Outlook

The press release does not provide numerical financial guidance. Senior Chairman and CEO David Zalman said the company remains focused on completing the operational integration of Texas Partners Bank and Stellar Bank and is excited about its future as a larger bank.