Prosperity Bancshares Reports 4.1% Asset Growth, 9.3% Net Interest Income Increase in Q3 2024

Prosperity Bancshares, Inc. reported significant growth in its financial performance for the third quarter and the nine months ended September 30, 2024, compared to the same periods in 2023. Total assets increased to $40.12 billion, up $1.57 billion (4.1%) from $38.55 billion at the end of 2023. Total loans rose to $22.38 billion, reflecting a $1.20 billion (5.7%) increase, while total deposits reached $28.09 billion, an increase of $907.8 million (3.3%).

Interest income for the third quarter of 2024 was $417.9 million, up from $380.4 million in the same quarter of 2023. This increase was driven by a rise in interest income from loans, which totaled $337.5 million, a $28.8 million (9.3%) increase year-over-year. Net interest income for the quarter was $261.7 million, up $22.2 million (9.3%) from the previous year. The net interest margin improved to 2.95%, a 23 basis point increase from 2.72% in Q3 2023.

Net income for the third quarter of 2024 was $127.3 million, or $1.34 per diluted share, compared to $112.2 million, or $1.20 per diluted share, in the prior year. For the nine months ended September 30, 2024, net income was $349.3 million, an increase from $323.8 million in 2023. The annualized return on average common equity improved to 6.40% from 6.25% in the previous year.

The company’s strategic developments included the completion of the merger with Lone Star State Bancshares, Inc. on April 1, 2024, which added $1.38 billion in assets, $1.08 billion in loans, and $1.24 billion in deposits. The merger resulted in recognized goodwill of $108 million. Additionally, the merger with First Bancshares of Texas, Inc. completed in May 2023, contributed further to the company’s growth.

Total noninterest income for the third quarter of 2024 was $41.1 million, a 6.1% increase from $38.7 million in the same quarter of 2023. Noninterest expenses rose to $140.3 million, up from $135.7 million, primarily due to increased salaries and benefits and additional operational expenses related to the Lone Star merger.

As of September 30, 2024, the allowance for credit losses on loans was $354.4 million, representing 1.58% of total loans, an increase from $332.4 million (1.57%) at the end of 2023. Nonperforming assets increased to $89.9 million, up from $72.7 million at the end of 2023, reflecting a rise in nonaccrual loans.

Overall, Prosperity Bancshares, Inc. demonstrated robust growth in key financial metrics, driven by strategic mergers and an increase in loan and deposit volumes.