Cullen/Frost Bankers (CFR) investor relations material

Executive summary

• Q3 2025 net income available to common shareholders was $172.7 million ($2.67 per share), up 19.2% year-over-year, with return on average assets at 1.32% and return on average common equity at 16.72%.

• Year-to-date net income available to common shareholders reached $477.3 million, a 12.9% increase from the prior year period, with EPS of $7.36 for the nine months.

• Growth was driven by higher net interest income, lower credit loss expense, and increased non-interest income, partially offset by higher non-interest and income tax expenses.

• Organic expansion strategy contributed to growth, with nearly 74,000 new households added and significant loan and deposit increases.

Financial highlights

• Net interest income for Q3 2025 was $463.7 million, up 9.1% year-over-year; non-interest income rose 10.5% to $125.6 million.

• Average loans for Q3 2025 increased 6.8% year-over-year to $21.5 billion; average deposits rose 3.3% to $42.1 billion.

• Non-interest expense rose 9.0% to $352.5 million in Q3 2025, mainly due to higher salaries, technology, and operating costs.

• Credit loss expense decreased by $12.6 million in Q3, reflecting improved credit quality and lower net charge-offs.

• Consumer real estate loans grew 18.7% year-over-year to $3.5 billion; commercial loans up 5.1%.

Outlook and guidance

• Full-year 2025 net interest income growth expected at 7–8%, with net interest margin projected to improve by 12–15 bps over 2024’s 3.53%.

• Average loan growth forecast at 6.5–7.5%; deposit growth at 2.5–3.5%, both in line or above prior guidance.

• Non-interest income growth outlook raised to 6.5–7.5% for the year; non-interest expense growth expected at 8–9%.

• Management expects continued above-market organic growth, supported by expansion and digital banking.

• Economic forecasts project moderate GDP growth, stable unemployment, and steady interest rates through 2027.