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Highlights
• Net interest margin improved to 4.07% from 3.81% in the previous quarter
• Diluted EPS rose to USD 0.86 from USD 0.72 in Q1 2025
• Book value per share increased to USD 27.98 from USD 27.33 in Q1 2025

South Plains Financial, Inc. (NASDAQ:SPFI) reported a net income of USD 14.6 million for the second quarter ended June 30, 2025, up from USD 12.3 million in the first quarter and USD 11.1 million in the same quarter last year. Diluted earnings per share came in at USD 0.86, compared to USD 0.72 in Q1 2025 and USD 0.66 in Q2 2024. Return on average assets rose to 1.34% from 1.16% in the prior quarter.

Net interest income for the quarter was USD 42.5 million, an increase from USD 38.5 million in Q1 2025 and USD 35.9 million in Q2 2024. This was supported by a tax-equivalent net interest margin of 4.07%, up from 3.81% in the previous quarter. The yield on loans increased to 6.99%, aided in part by a USD 1.7 million interest recovery related to a repaid nonaccrual loan. Average cost of deposits declined to 214 basis points from 219 basis points in Q1 2025.

Noninterest income totaled USD 12.2 million, compared to USD 10.6 million in the first quarter. This increase was driven by a USD 1.5 million rise in mortgage banking revenues. Noninterest expense was USD 33.5 million, up slightly from USD 33.0 million in Q1 2025. The rise was primarily attributed to higher personnel and professional service expenses.

Loans held for investment reached USD 3.10 billion as of June 30, 2025, marking a USD 23.1 million increase from the prior quarter. Meanwhile, deposits were USD 3.74 billion, a sequential decline of USD 53.6 million, attributed to seasonal decreases in public fund deposits. Noninterest-bearing deposits made up 26.7% of the total.

The company recorded a provision for credit losses of USD 2.5 million, higher than both Q1 2025 (USD 420 thousand) and Q2 2024 (USD 1.8 million). The allowance for credit losses stood at 1.45% of loans held for investment. Nonperforming assets as a percentage of total assets increased to 0.25% from 0.16% in Q1 2025.

Tangible book value per share was USD 26.70, up from USD 26.05 at the end of March. The consolidated total risk-based capital ratio was 18.17% as of June 30, 2025, with a common equity tier 1 ratio of 13.86% and tier 1 leverage ratio of 12.12%.