Southside Bancshares (SBSI) Q2 2026 earnings summary

Executive summary

• Net income for Q2 2026 was $26.8 million, up 23% year-over-year and $3.6 million sequentially, with EPS of $0.90 and ROAA of 1.23%.

• For the first half of 2026, net income was $50.1 million, up 15.6% year-over-year; EPS was $1.68, up 18.3%.

• Total assets grew 2.9% to $8.76 billion since year-end 2025, with loans up 2.7% and securities up 2.9%.

• Deposits declined 10.1% to $6.17 billion, mainly due to a reduction in brokered deposits.

• Texas markets served are healthy and expected to outpace national growth, though management remains cautious about inflation and interest rate risks.

Financial highlights

• Net interest income for Q2 2026 was $57.3 million, up 5.7% year-over-year; net interest margin declined to 2.90% due to higher funding costs.

• Noninterest income for Q2 2026 was $14.0 million, up 15.3% year-over-year, driven by BOLI, deposit services, and trust fees.

• Noninterest expense for Q2 2026 was $38.7 million, down 1.5% year-over-year and 4.7% sequentially, mainly from lower salaries and benefits.

• Allowance for loan losses was $45.6 million, or 0.92% of total loans; nonperforming assets were $9.8 million, or 0.11% of total assets.

• Deposits fell $705.1 million, mainly from brokered deposit outflows, partially offset by retail deposit growth.

Outlook and guidance

• Targeting mid single-digit loan growth for 2026, supported by strong production in Q2.

• Expect continued margin pressure absent Fed rate hikes, but asset sensitivity could benefit NII if rates rise.

• Non-interest expense budgeted at ~$40.5 million per quarter for the remainder of the year.

• Optimistic trust and brokerage fees will exceed budget if current trends persist.

• Interest rate risk and liquidity are closely monitored, with simulation models used to assess impacts.