South Plains Financial: Navigating Challenges, Delivering Growth in Q4 2024

As the calendar turned to 2025, South Plains Financial, Inc. (NASDAQ: SPFI) reported its financial results for the fourth quarter and full year of 2024, showcasing the company's ability to navigate challenging environments and deliver strong performance. The company's strategic management of liquidity and risk, coupled with a growing level of optimism among its customer base, positioned South Plains Financial for continued success in the coming year.



South Plains Financial's strategic management of liquidity and risk contributed significantly to its strong financial performance in Q4 2024. The company's net interest income increased to $38.5 million, up from $37.3 million in Q3 2024, and its net interest margin expanded to 3.75%, up from 3.65% in the previous quarter. This demonstrates the company's ability to balance its liquidity needs with its profitability goals. Additionally, South Plains maintained a conservative approach to underwriting and risk management, as evidenced by its return on average assets increasing to 1.53% annualized in Q4 2024, up from 1.05% annualized in Q3 2024.

The company's ability to manage its indirect auto portfolio and a heightened level of loan payoffs and paydowns also contributed to its overall performance. Despite these challenges, South Plains' underlying loan production remained strong, with loans held for investment growing by $40.9 million, or 1.4%, during 2024. This growth was driven by a strong new business production pipeline and a growing level of optimism among the company's customer base.

Looking ahead to 2025, South Plains Financial expects to deliver low to mid-single-digit loan growth for the full year. This expectation is supported by the company's strong new business production pipeline, falling deposit pricing, and a conservative approach to underwriting and risk management. As Curtis Griffith, South Plains' Chairman and Chief Executive Officer, stated, "We are seeing a growing level of optimism across our customer base that is translating into the strongest new business production pipeline that we have seen in more than two years. This bodes positively for the year ahead where we expect to deliver low to mid-single digit loan growth for the full year 2025."

In conclusion, South Plains Financial's strategic management of liquidity and risk, coupled with a growing level of optimism among its customer base, positioned the company for continued success in 2025. The company's strong financial performance in Q4 2024, driven by its ability to manage its liquidity, maintain a conservative risk management approach, and effectively manage its loan portfolio, sets the stage for further growth and profitability in the coming year. Investors should closely monitor South Plains Financial's progress as it continues to navigate the dynamic financial landscape and deliver value to its shareholders.