What were the key takeaways from South Plains's earnings call?

What guidance did South Plains's management provide for the next earnings period?

What is the market's earnings forecast for South Plains next quarter?

What is South Plains's latest dividend and current dividend yield?

What is the revenue and EPS growth rate for South Plains year over year?

Did South Plains beat or miss consensus estimates last quarter?

What does South Plains do and what are its main business segments?

What factors drove the changes in South Plains's revenue and profit?

- **EPS Growth**: 11.6% QoQ increase to $0.96, driven by reduced credit provisions and NIM expansion.
- **Lending Expansion**: 10% of 20% hiring target achieved, targeting 6-month breakeven for new lenders.
- **Capital Strength**: Tier 1 leverage ratio of 12.37% supports M&A and dividend policy.
- **Cost Savings**: $3.5M annual savings from subordinated debt redemption.
- **Credit Resilience**: Indirect auto portfolio 30+ DPD rate at 24 basis points, with 86% of loans to high-credit borrowers.

**【CEO Summary Section】**
- Delivered strong third-quarter results with net interest income expansion and improved credit quality.
- Emphasized organic growth through hiring (up to 20% increase in lending team) and selective M&A opportunities.
- Highlighted capital strength (Tier 1 leverage ratio of 12.37%) and commitment to shareholder returns (26th consecutive dividend).

**【CFO Financial Commentary】**
- Diluted EPS of $0.96, up 11.6% QoQ, driven by reduced provision for credit losses and net interest income growth.
- Net interest margin (NIM) on a tax-equivalent basis was 4.05%, with 9 basis points of improvement excluding one-time credit workout gains.
- Deposits increased $142.2 million, driven by low-cost noninterest-bearing deposits (27% of total).
- Redemption of $50 million subordinated debt saved $3.5 million annually in interest costs.

**【Q&A Key Highlights】**
- **Lending Team Expansion**: 10% of 20% target achieved, with hires in Houston, Dallas, and Permian Basin. Breakeven expected within 6 months.
- **M&A Strategy**: Focus on culture-fit banks with conservative risk profiles; multiple deals in early stages.
- **Indirect Auto Portfolio**: Tightened LTV standards; 86% of loans to super prime/prime borrowers, with 30+ DPD rate at 24 basis points.
- **NIM Outlook**: Expect modest decline in Q4 due to lagging deposit repricing, but stable long-term outlook.
- **Credit Risks**: Elevated loan payoffs (multifamily down $100M over 3Qs) but no material impact on asset quality.


South Plains Financial, Inc. (SPFI) Q3 2025 Earnings Call Transcript

- **Loan Growth Resilience**: 3% annualized loan growth despite $49.1 million in multifamily payoffs, supported by solid pipeline and new lender hires.
- **Yield Expansion**: Core loan yield up 9bps to 6.76%, driven by declining deposit costs and selective pricing.
- **Capital Strength**: Well-capitalized with 13.86% Tier 1 ratio, enabling organic growth and shareholder returns.
- **M&A Caution**: No deals meet strict criteria, but improving deal environment may lead to future opportunities.
- **Earnings Momentum**: EPS up 19% to $0.86, with NIM at 4.07% and stable noninterest income.

**【Management Opening Remarks】**
- CFO Steve Crockett emphasized the company's strong financial position and earnings power, highlighting healthy economic growth in Texas and opportunities for organic and M&A-driven growth.
- CEO Curtis Griffith expressed sympathy for flood victims and noted the bank's proactive approach to supporting affected communities.

**【CEO Summary Section】**
- **Loan Growth**: Despite $49.1 million in multifamily loan payoffs, loans held for investment grew by $23.1 million (3% annualized) to $3.1 billion.
- **Yield Improvement**: Loan yield rose 23bps to 6.99% due to a $1.7 million interest recovery, with a 9bps core increase to 6.76%.
- **M&A Strategy**: Targeting accretive acquisitions with a focus on culture, asset-liability profile, and stable deposits; no current deals meet criteria.
- **Capital Strength**: Common equity Tier 1 ratio of 13.86% and leverage ratio of 12.12%, enabling organic growth and shareholder returns.

**【CFO Financial Commentary】**
- **Earnings**: Diluted EPS of $0.86 (up 19% vs. prior quarter), driven by $0.09 from loan recovery.
- **Net Interest Margin (NIM)**: 4.07% (3.81% prior quarter), with 9bps core expansion to 3.90% due to 5bps deposit cost decline.
- **Deposit Trends**: Noninterest-bearing deposits rose $32.3 million (26.7% of total), offsetting $53.6 million public fund outflows.
- **Expenses**: $33.5 million (flat vs. prior quarter), with modest increases in personnel and professional services.
- **Capital**: Tangible common equity to tangible assets of 9.98%, up 34bps, and tangible book value per share of $26.70.

**【Q&A Highlights】**
- **Loan Pipeline**: Flat to low single-digit growth expected for 2025, with $15 million higher payoffs in Q2 vs. Q1.
- **M&A vs. Hiring**: No intention to pause hiring for M&A; focus on relationship bankers who bring deposits and loans.
- **Specific Reserves**: Increase due to credit quality downgrades and new nonaccrual loans, not tied to large multifamily credit.
- **Margin Outlook**: NIM stabilization near current levels, with CD repricing and selective deposit pricing as key drivers.
- **Mortgage Banking**: Flat performance expected, with focus on maintaining relationships and infrastructure.
- **Deposit Strategy**: Treasury management solutions driving noninterest-bearing deposit growth, with lenders incentivized for deposit origination.


South Plains Financial, Inc. (SPFI) Q2 2025 Earnings Call Transcript

- **Strong Credit Quality**: NPA ratio 16bps (vs. 58bps Q4 2024), 1.40% ACL-to-loans ratio.\n- **Capital Strength**: 13.59% CET1, $0.15/share dividend, $7M remaining buyback capacity.\n- **Texas Growth Focus**: 33.8% of loans in major metros; 4% energy exposure (service sector).\n- **Economic Resilience**: 3.81% NIM stable; deposit cost at 219bps with limited downside.\n- **Risk Management**: Tight credit standards in auto lending (30+ DPD 41bps vs. 47bps Q4).\n

**【CEO Opening Remarks】**
- Q1 2025 highlights: 2.7% loan growth to $3.08B, 6.67% loan yield, and NPA ratio improving to 16bps (vs. 58bps at year-end 2024).\n- Credit quality remains strong, with $6.5M NPLs (down from $24M Q4 2024) and 1.40% ACL-to-loans ratio.\n- Texas-focused growth strategy leverages low-tax environment; 33.8% of loans in major metros (Dallas, Houston, El Paso).\n- Tariff-related recession risks are mitigated by focus on CRE vs. C&amp;I loans.\n- Capital strength: CET1 ratio 13.59%, dividend of $0.15/share (24th consecutive quarter), and $15M stock buyback program ($8.3M used in Q1).\n
**【CFO Financial Highlights】**
- EPS: $0.72 (down from $0.96 Q4 2024) due to $0.14/MoM decline in mortgage servicing rights valuation.\n- NIM: 3.81% (vs. 3.75% Q4 2024), driven by 10bps deposit cost decline to 219bps.\n- Deposit growth: $171.6M (annualized 16%) to $3.79B, with 25.5% non-interest-bearing deposits.\n- Expense management: Q1 non-interest expense $33.0M (vs. $29.9M Q4 2024), guided as run rate for 2025.\n- Capital metrics: Tangible book value $26.05/share (up 2.6% QoQ).\n
**【Q&A Key Takeaways】**
1. **Deposit Cost Outlook**: 219bps Q1 vs. 229bps Q4; further reductions possible but limited by liquidity needs.\n2. **NIM Expansion**: 3.81% target stable; potential for modest growth if loan production accelerates.\n3. **Loan Payoffs**: $10M+ Q1 run rate, expected to persist but offset by strong pipeline.\n4. **Hiring Strategy**: Selective lender additions in Texas markets; 4% energy exposure (service sector-focused).\n5. **Mortgage Outlook**: Fee income cautious due to economic uncertainty; 2025 volume expected to slightly exceed 2024.\n

South Plains Financial (SPFI)-24 Apr 25-2025 Q1 Earnings call transcript

- **EPS outperformance**: 2024 diluted EPS of $2.92 vs. $3.62 in 2023 (excluding one-time gain), +$0.62 YoY beat.
- **NIM expansion**: 10bps QoQ increase to 3.75% driven by deposit repricing and cost control.
- **Loan growth pipeline**: 2025 outlook for low to mid-single-digit growth, supported by $13.3M Q4 non-interest income.
- **Capital strength**: 13.53% common equity Tier 1 ratio and $0.15 quarterly dividend reaffirm balance sheet resilience.
- **Permian optimism**: Houston/Midland loan demand driven by energy sector activity, despite oil price volatility.

**【CEO Opening Remarks】**
- Full-year 2024 diluted EPS of $2.92, outperforming 2023 by $0.62 per share (excluding one-time gain from Windmark sale). 
- Loan portfolio grew 1.4% YoY to $3.06B, offsetting indirect auto loan declines.
- Deposit franchise remained stable at $3.6B, with 79% in rural markets.
- NIM increased 10bps QoQ to 3.75% due to deposit repricing and reduced interest expense.
- 2025 outlook: low to mid-single-digit loan growth, cautious M&A approach, and $0.15 quarterly dividend.

**【CFO Financial Highlights】**
- Q4 net interest income: $38.5M (+3.2% YoY), driven by 18bps deposit cost decline.
- Non-interest expense: $29.9M (-10% YoY) due to lower health insurance costs and mortgage commissions.
- Allowance for credit losses: 1.42% of loans, with $1.2M provision for credit losses.
- Capital position: Common equity Tier 1 ratio of 13.53%, well above regulatory thresholds.

**【Cory Newsom - Loan Portfolio Update】**
- Q4 loan growth of $17.7M (+0.6% QoQ) in commercial real estate, offset by $15M indirect auto decline.
- Indirect auto portfolio stabilized at $236M with 47bps 30+ DPD rate.
- New business pipeline at highest levels since mid-2022, driven by Permian Basin optimism.
- Non-interest income: $13.3M (+29% YoY) from mortgage banking and MSR valuation gains.

**【Q&A Key Takeaways】**
- Loan yield stability: 6.69% Q4 vs. 6.68% Q3, despite rate cuts, due to repriced loans and payoff mix.
- NIM outlook: Potential 10-20bps expansion in 2025 with stable rates, driven by loan growth and deposit repricing.
- M&A strategy: Actively evaluating deals but prioritizing accretive transactions with cultural fit.
- Economic sensitivity: Permian Basin activity resilient to oil price volatility, supporting Houston/Midland loan growth.

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