Southside Bancshares, Inc. Announces Financial Results for the First Quarter Ended March 31, 2025

Rhea-AI Summary

Southside Bancshares reported stable financial results for Q1 2025, with net income of $21.5 million and earnings per diluted share of $0.71, matching the same figures from Q1 2024. The bank maintained a return on average assets of 1.03% while achieving a return on average tangible common equity of 14.14%.

Key financial highlights include:

• Net interest income increased to $53.9 million, up 0.9% year-over-year
• Net interest margin improved to 2.74%
• Total assets reached $8.34 billion
• Total loans stood at $4.57 billion
• Deposits grew to $6.59 billion

The bank's asset quality showed some changes with nonperforming assets at 0.39% of total assets, an increase from 0.10% year-over-year. The allowance for loan losses was 0.98% of total loans. CEO Lee R. Gibson noted expectations for mid-single-digit loan growth in 2025, likely concentrated in the second half of the year.

Positive

• Stable earnings with $21.5M net income and $0.71 EPS in Q1 2025
• Net interest margin increased to 2.86% (up 3 basis points quarter-over-quarter)
• Net interest income grew by $0.5M YoY to $53.9M
• Deposits net of public fund and brokered deposits increased by $91.9M
• Strong capital ratios with $2.29B available contingent liquidity
• Improved efficiency ratio at 57.04% vs 57.95% YoY
• Noninterest income increased by 5.1% YoY to $10.2M

Negative

• Nonperforming assets increased significantly to 0.39% of total assets (up from 0.10% YoY)
• Total loans decreased by $94.4M (2.0%) quarter-over-quarter
• Classified loans increased to $67M from $48M in previous quarter
• Total deposits decreased by $63.4M (1.0%) quarter-over-quarter
• High level of uninsured deposits at 40% of total deposits
• Return on average shareholders' equity declined to 10.57% from 11.02% YoY

Insights

Banking Financial Analyst

Southside maintains steady performance with flat earnings, while increased nonperforming assets stem primarily from a single loan restructuring rather than systemic issues.

Southside Bancshares reported Q1 2025 net income of $21.5 million and earnings per diluted share of $0.71, exactly matching Q1 2024 results. Key profitability metrics remained stable with annualized return on average assets at 1.03% and return on average tangible common equity at 14.14%.

The bank's net interest margin improved slightly to 2.74% from 2.72% year-over-year, while tax-equivalent net interest margin held steady at 2.86%. Net interest income grew marginally by 0.9% to $53.9 million. Efficiency ratios improved year-over-year, from 57.95% to 57.04%, indicating enhanced operational efficiency.

Asset quality metrics show a notable increase in nonperforming assets to $32.2 million (0.39% of total assets) from $8.0 million (0.10%) a year earlier. This 303.5% increase primarily stems from a single $27.5 million commercial real estate loan restructuring that extended maturity to allow for a longer lease-up period, rather than systemic credit deterioration.

The balance sheet remained relatively stable with total assets at $8.34 billion. Loans decreased slightly by 0.2% year-over-year and 2.0% quarter-over-quarter to $4.57 billion, with management attributing this to higher-than-expected payoffs while maintaining guidance for mid-single-digit loan growth in 2025, weighted toward the second half.

Deposits increased 0.7% year-over-year to $6.59 billion but decreased 1.0% quarter-over-quarter. Importantly, funding costs improved with interest-bearing deposit costs decreasing 14 basis points year-over-year to 2.83%, and total deposit costs falling 10 basis points to 2.26%.

Liquidity remains strong with $2.29 billion in available contingent sources, and the quarterly dividend was maintained at $0.36 per share. The bank's uninsured deposits represent 40.0% of total deposits, but when excluding affiliate and collateralized public fund deposits, only 20.8% of deposits lack insurance or collateral.

• First quarter net income of $21.5 million;
• First quarter earnings per diluted common share of $0.71;
• Annualized return on first quarter average assets of 1.03%;
• Annualized return on first quarter average tangible common equity of 14.14%⁽¹⁾; and
• Nonperforming assets remain low at 0.39% of total assets.
  

TYLER, Texas, April 29, 2025 (GLOBE NEWSWIRE) -- Southside Bancshares, Inc. (“Southside” or the “Company”) (NYSE: SBSI) today reported its financial results for the quarter ended March 31, 2025. Southside reported net income of $21.5 million and earnings per diluted common share of $0.71 for both of the three month periods ended March 31, 2025 and 2024. The annualized return on average shareholders’ equity for the three months ended March 31, 2025 was 10.57%, compared to 11.02% for the same period in 2024. The annualized return on average assets was 1.03% for both of the three month periods ended March 31, 2025 and 2024.

“We are pleased to report financial results for the first quarter ended March 31, 2025, which included earnings per share of $0.71, a return on average assets of 1.03%, and a return on average tangible common equity of 14.14%,” stated Lee R. Gibson, Chief Executive Officer of Southside. “Linked quarter, the net interest margin increased three basis points to 2.86%, net interest income increased $145,000 to $53.9 million, and deposits net of public fund and brokered deposits increased $91.9 million. The linked quarter decrease in total loans was primarily due to payoffs exceeding original projections. Our loan pipeline is solid and we continue to anticipate mid-single-digit loan growth for 2025; however, it will likely be heavily weighted in the last half of the year.”

Operating Results for the Three Months Ended March 31, 2025

Net income was $21.5 million and earnings per diluted common share were $0.71 for both of the three month periods ended March 31, 2025 and 2024. Annualized returns on average assets and average shareholders’ equity for the three months ended March 31, 2025 were 1.03% and 10.57%, respectively, compared to 1.03% and 11.02%, respectively, for the three months ended March 31, 2024. Our efficiency ratio and tax-equivalent efficiency ratio⁽¹⁾ were 57.04% and 55.04%, respectively, for the three months ended March 31, 2025, compared to 57.95% and 55.54%, respectively, for the three months ended March 31, 2024, and 56.08% and 54.00%, respectively, for the three months ended December 31, 2024.

Net interest income for the three months ended March 31, 2025 was $53.9 million, an increase of $0.5 million, or 0.9%, compared to the same period in 2024. Linked quarter, net interest income increased $0.1 million, or 0.3%, compared to $53.7 million for the three months ended December 31, 2024. The increase in net interest income for both periods was due to the decrease in the average rate paid on interest bearing liabilities and the increase in the average balance of our interest earning assets, partially offset by the decrease in the average yield of interest earning assets and the increase in the average balance of our interest bearing liabilities.

Our net interest margin increased to 2.74% for the three months ended March 31, 2025, compared to 2.72% for the same period in 2024, while tax-equivalent net interest margin⁽¹⁾ was 2.86% for both of the three month periods ended March 31, 2025 and 2024. Linked quarter, net interest margin and tax-equivalent net interest margin⁽¹⁾ increased from 2.70% and 2.83%, respectively, for the three months ended December 31, 2024.

Noninterest income was $10.2 million for the three months ended March 31, 2025, an increase of $0.5 million, or 5.1%, compared to $9.7 million for the same period in 2024. The increase was primarily due to increases in gain on sale of loans and trust fees, partially offset by an increase in net loss on sale of securities available for sale (“AFS”). On a linked quarter basis, noninterest income decreased $2.1 million, or 16.8%, compared to the three months ended December 31, 2024. The decrease was primarily due to a decrease in other noninterest income, an increase in net loss on sale of securities AFS and a decrease in deposit services income. The decrease in other noninterest income was due to a decrease in swap fee income for the three months ended March 31, 2025.

Noninterest expense increased $0.2 million, or 0.6%, to $37.1 million for the three months ended March 31, 2025, compared to $36.9 million for the same period in 2024, due to increases in other noninterest expense and professional fees, partially offset by decreases in salaries and employee benefits expense and amortization of intangibles. On a linked quarter basis, noninterest expense decreased by $1.1 million, or 2.8%, compared to the three months ended December 31, 2024, due to decreases in salaries and employee benefits, net occupancy, other noninterest expense and professional fees.

Income tax expense increased $0.1 million, or 2.1%, for the three months ended March 31, 2025, compared to the same period in 2024. On a linked quarter basis, income tax expense increased $0.1 million, or 1.3%. Our effective tax rate (“ETR”) increased to 18.0% for the three months ended March 31, 2025, compared to 17.7% for the three months ended March 31, 2024, and increased from 17.6% for the three months ended December 31, 2024. The higher ETR for the three months ended March 31, 2025 compared to the same period in 2024, was primarily due to an increase in state income tax expense.

Balance Sheet Data

At March 31, 2025, Southside had $8.34 billion in total assets, compared to $8.35 billion at March 31, 2024, and $8.52 billion at December 31, 2024.

Loans at March 31, 2025 were $4.57 billion, a decrease of $10.1 million, or 0.2%, compared to $4.58 billion at March 31, 2024. Linked quarter, loans decreased $94.4 million, or 2.0%, due to decreases of $79.7 million in construction loans, $19.7 million in municipal loans, $2.5 million in commercial real estate loans and $1.9 million in loans to individuals. These decreases were partially offset by increases of $8.5 million in commercial loans and $1.0 million in 1-4 family residential loans.

Securities at March 31, 2025 were $2.74 billion, an increase of $24.2 million, or 0.9%, compared to $2.71 billion at March 31, 2024. Linked quarter, securities decreased $76.9 million, or 2.7%, from $2.81 billion at December 31, 2024.

Deposits at March 31, 2025 were $6.59 billion, an increase of $45.1 million, or 0.7%, compared to $6.55 billion at March 31, 2024. Linked quarter, deposits decreased $63.4 million, or 1.0%, from $6.65 billion at December 31, 2024.

At March 31, 2025, we had 178,840 total deposit accounts with an average balance of $34,000. Our estimated uninsured deposits were 40.0% of total deposits as of March 31, 2025. When excluding affiliate deposits (Southside-owned deposits) and public fund deposits (all collateralized), our total estimated deposits without insurance or collateral was 20.8% as of March 31, 2025. Our noninterest bearing deposits represent approximately 20.9% of total deposits. Linked quarter, our cost of interest bearing deposits decreased nine basis points from 2.92% in the prior quarter to 2.83%. Linked quarter, our cost of total deposits decreased five basis points from 2.31% in the prior quarter to 2.26%.

Our cost of interest bearing deposits decreased 14 basis points, from 2.97% for the three months ended March 31, 2024, to 2.83% for the three months ended March 31, 2025. Our cost of total deposits decreased 10 basis points, from 2.36% for the three months ended March 31, 2024, to 2.26% for the three months ended March 31, 2025.

Capital Resources and Liquidity

Our capital ratios and contingent liquidity sources remain solid. During the first quarter ended March 31, 2025, we did not purchase any common stock pursuant to our Stock Repurchase Plan. Under this plan, repurchases of our outstanding common stock may be carried out in open market purchases, privately negotiated transactions or pursuant to any trading plan that might be adopted in accordance with Rule 10b5-1 of The Securities Exchange Act of 1934, as amended. The Company has no obligation to repurchase any shares under the Stock Repurchase Plan and may modify, suspend or discontinue the plan at any time. Subsequent to March 31, 2025, and through April 25, 2025, we purchased 196,419 shares of common stock at an average price of $26.82 pursuant to the Stock Repurchase Plan.

As of March 31, 2025, our total available contingent liquidity, net of current outstanding borrowings, was $2.29 billion, consisting of FHLB advances, Federal Reserve Discount Window and correspondent bank lines of credit.

Asset Quality

Nonperforming assets at March 31, 2025 were $32.2 million, or 0.39% of total assets, an increase of $24.2 million, or 303.5%, compared to $8.0 million, or 0.10% of total assets, at March 31, 2024. Linked quarter, nonperforming assets increased $28.6 million, or 797.0%, from $3.6 million at December 31, 2024 due primarily to increases of $27.5 million in restructured loans and $1.1 million in nonaccrual loans. The increase in restructured loans was due to the extension of maturity on a $27.5 million commercial real estate loan to allow for an extended lease up period. Classified loans totaled $67.0 million on March 31, 2025, compared to $48.0 million on December 31, 2024, primarily due to the downgrade of a $17.9 million commercial real estate loan in the first quarter that paid off on April 4, 2025.

The allowance for loan losses totaled $44.6 million, or 0.98% of total loans, at March 31, 2025, compared to $44.9 million, or 0.96% of total loans, at December 31, 2024. The allowance for loan losses was $43.6 million, or 0.95% of total loans, at March 31, 2024. The increase in allowance as a percentage of total loans was primarily due to an increase in economic concerns forecasted in the CECL model, partially offset by a decrease in the loan portfolio due to payoffs.

For the three months ended March 31, 2025, we recorded a provision for credit losses for loans of $42,000, compared to a provision of $1.2 million and $1.6 million for the three months ended March 31, 2024 and December 31, 2024, respectively. Net charge-offs were $0.3 million for the three months ended March 31, 2025 and March 31, 2024, compared to net charge-offs of $1.0 million for the three months ended December 31, 2024.

We recorded a provision for credit losses on off-balance-sheet credit exposures of $0.7 million for the three months ended March 31, 2025, compared to a reversal of provision for credit losses on off-balance-sheet credit exposures $1.1 million and $0.2 million for the three months ended March 31, 2024 and December 31, 2024, respectively. The balance of the allowance for off-balance-sheet credit exposures was $3.8 million and $2.8 million at March 31, 2025 and 2024, respectively, and is included in other liabilities.

Dividend

Southside Bancshares, Inc. declared a first quarter cash dividend of $0.36 per share on February 6, 2025, which was paid on March 6, 2025, to all shareholders of record as of February 20, 2025.

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(1)	Refer to “Non-GAAP Financial Measures” below and to “Non-GAAP Reconciliation” at the end of the financial statement tables in this Earnings Release for more information and for a reconciliation of this non-GAAP financial measure to the nearest GAAP financial measure.

Conference Call

Southside's management team will host a conference call to discuss its first quarter ended March 31, 2025 financial results on Tuesday, April 29, 2025 at 11:00 a.m. CDT. The conference call can be accessed by webcast, for listen-only mode, on the company website, https://investors.southside.com, under Events.

Those interested in participating in the question and answer session, or others who prefer to call-in, can register at https://register-conf.media-server.com/register/BI1a8ec95cd2734970adaf83fadfc7f01d to receive the dial-in number and unique code to access the conference call seamlessly. While not required, it is recommended that those wishing to participate, register 10 minutes prior to the conference call to ensure a more efficient registration process.

For those unable to attend the live event, a webcast recording will be available on the company website, https://investors.southside.com, for at least 30 days, beginning approximately two hours following the conference call.

Non-GAAP Financial Measures

Our accounting and reporting policies conform to generally accepted accounting principles (“GAAP”) in the United States and prevailing practices in the banking industry. However, certain non-GAAP measures are used by management to supplement the evaluation of our performance. These include the following fully taxable-equivalent measures (“FTE”): (i) Net interest income (FTE), (ii) net interest margin (FTE), (iii) net interest spread (FTE), and (iv) efficiency ratio (FTE), which include the effects of taxable-equivalent adjustments using a federal income tax rate of 21% to increase tax-exempt interest income to a tax-equivalent basis. Interest income earned on certain assets is completely or partially exempt from federal income tax. As such, these tax-exempt instruments typically yield lower returns than taxable investments.

Net interest income (FTE), net interest margin (FTE) and net interest spread (FTE). Net interest income (FTE) is a non-GAAP measure that adjusts for the tax-favored status of net interest income from certain loans and investments and is not permitted under GAAP in the consolidated statements of income. We believe that this measure is the preferred industry measurement of net interest income and that it enhances comparability of net interest income arising from taxable and tax-exempt sources. The most directly comparable financial measure calculated in accordance with GAAP is our net interest income. Net interest margin (FTE) is the ratio of net interest income (FTE) to average earning assets. The most directly comparable financial measure calculated in accordance with GAAP is our net interest margin. Net interest spread (FTE) is the difference in the average yield on average earning assets on a tax-equivalent basis and the average rate paid on average interest bearing liabilities. The most directly comparable financial measure calculated in accordance with GAAP is our net interest spread.

Efficiency ratio (FTE). The efficiency ratio (FTE) is a non-GAAP measure that provides a measure of productivity in the banking industry. This ratio is calculated to measure the cost of generating one dollar of revenue. The ratio is designed to reflect the percentage of one dollar which must be expended to generate that dollar of revenue. We calculate this ratio by dividing noninterest expense, excluding amortization expense on intangibles and certain nonrecurring expense by the sum of net interest income (FTE) and noninterest income, excluding net gain (loss) on sale of securities available for sale and certain nonrecurring impairments. The most directly comparable financial measure calculated in accordance with GAAP is our efficiency ratio.

These non-GAAP financial measures should not be considered alternatives to GAAP-basis financial statements and other bank holding companies may define or calculate these non-GAAP measures or similar measures differently. Whenever we present a non-GAAP financial measure in an SEC filing, we are also required to present the most directly comparable financial measure calculated and presented in accordance with GAAP and reconcile the differences between the non-GAAP financial measure and such comparable GAAP measure.

Management believes adjusting net interest income, net interest margin and net interest spread to a fully taxable-equivalent basis is a standard practice in the banking industry as these measures provide useful information to make peer comparisons. Tax-equivalent adjustments are reflected in the respective earning asset categories as listed in the “Average Balances with Average Yields and Rates” tables.

A reconciliation of our non-GAAP financial measures to the comparable GAAP financial measures is included at the end of the financial statement tables.

About Southside Bancshares, Inc.

Southside Bancshares, Inc. is a bank holding company with approximately $8.34 billion in assets as of March 31, 2025, that owns 100% of Southside Bank. Southside Bank currently has 53 branches in Texas and operates a network of 73 ATMs/ITMs.

To learn more about Southside Bancshares, Inc., please visit our investor relations website at https://investors.southside.com. Our investor relations site provides a detailed overview of our activities, financial information and historical stock price data. To receive email notification of company news, events and stock activity, please register on the website under Resources and Investor Email Alerts. Questions or comments may be directed to Lindsey Bailes at (903) 630-7965, or lindsey.bailes@southside.com.

Forward-Looking Statements

Certain statements of other than historical fact that are contained in this press release and in other written materials, documents and oral statements issued by or on behalf of the Company may be considered to be “forward-looking statements” within the meaning of and subject to the safe harbor protections of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are not guarantees of future performance, nor should they be relied upon as representing management’s views as of any subsequent date. These statements may include words such as “expect,” “estimate,” “project,” “anticipate,” “appear,” “believe,” “could,” “should,” “may,” “might,” “will,” “would,” “seek,” “intend,” “probability,” “risk,” “goal,” “target,” “objective,” “plans,” “potential,” and similar expressions. Forward-looking statements are statements with respect to the Company’s beliefs, plans, expectations, objectives, goals, anticipations, assumptions, estimates, intentions and future performance and are subject to significant known and unknown risks and uncertainties, which could cause the Company's actual results to differ materially from the results discussed in the forward-looking statements. For example, benefits of the Share Repurchase Plan, trends in asset quality, capital, liquidity, the Company's ability to sell nonperforming assets, expense reductions, planned operational efficiencies and earnings from growth and certain market risk disclosures, including the impact of interest rates and our expectations regarding rate changes, tax reform, inflation, tariffs, the impacts related to or resulting from other economic factors are based upon information presently available to management and are dependent on choices about key model characteristics and assumptions and are subject to various limitations. By their nature, certain of the market risk disclosures are only estimates and could be materially different from what actually occurs in the future. Accordingly, our results could materially differ from those that have been estimated. The most significant factor that could cause future results to differ materially from those anticipated by our forward-looking statements include the ongoing impact of higher inflation levels, interest rate fluctuations, including the impact of changes in interest rates on our financial projections, models and guidance, and general economic and recessionary concerns, as well as the effects of declines in the real estate market, tariffs or trade wars (including reduced consumer spending, lower economic growth or recession, reduced demand for U.S. exports, disruptions to supply chains, and decreased demand for other banking products and services), high unemployment and increasing insurance costs, as well as the financial stress on borrowers as a result of the foregoing, all of which could impact economic growth and could cause a reduction in financial transactions and business activities, including decreased deposits and reduced loan originations, and our ability to manage liquidity in a rapidly changing and unpredictable market.

Additional information concerning the Company and its business, including additional factors that could materially affect the Company’s financial results, is included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024, under “Part I - Item 1. Forward Looking Information” and “Part I - Item 1A. Risk Factors” and in the Company’s other filings with the Securities and Exchange Commission. The Company disclaims any obligation to update any factors or to announce publicly the result of revisions to any of the forward-looking statements included herein to reflect future events or developments.

Southside Bancshares, Inc. Consolidated Financial Summary (Unaudited) (Dollars in thousands)
	As of
		2025				2024
	Mar 31,				Dec 31,				Sep 30,				Jun 30,				Mar 31,
ASSETS
Cash and due from banks	$	103,359			$	91,409			$	130,147			$	114,283			$	96,744
Interest earning deposits		293,364				281,945				333,825				272,469				307,257
Federal funds sold		34,248				52,807				22,325				65,244				65,372
Securities available for sale, at estimated fair value		1,457,939				1,533,894				1,408,437				1,405,944				1,405,221
Securities held to maturity, at net carrying value		1,278,330				1,279,234				1,288,403				1,305,975				1,306,898
Total securities		2,736,269				2,813,128				2,696,840				2,711,919				2,712,119
Federal Home Loan Bank stock, at cost		34,208				33,818				40,291				32,991				27,958
Loans held for sale		903				1,946				768				1,352				756
Loans		4,567,239				4,661,597				4,578,048				4,589,365				4,577,368
Less: Allowance for loan losses		(44,623	)			(44,884	)			(44,276	)			(42,407	)			(43,557	)
Net loans		4,522,616				4,616,713				4,533,772				4,546,958				4,533,811
Premises & equipment, net		142,245				141,648				138,811				138,489				139,491
Goodwill		201,116				201,116				201,116				201,116				201,116
Other intangible assets, net		1,531				1,754				2,003				2,281				2,588
Bank owned life insurance		137,962				138,313				137,489				136,903				136,604
Other assets		135,479				142,851				124,876				133,697				130,047
Total assets	$	8,343,300			$	8,517,448			$	8,362,263			$	8,357,702			$	8,353,863
LIABILITIES AND SHAREHOLDERS' EQUITY
Noninterest bearing deposits	$	1,379,641			$	1,357,152			$	1,377,022			$	1,366,924			$	1,358,827
Interest bearing deposits		5,211,210				5,297,096				5,058,680				5,129,008				5,186,933
Total deposits		6,590,851				6,654,248				6,435,702				6,495,932				6,545,760
Other borrowings and Federal Home Loan Bank borrowings		691,417				808,352				865,856				763,700				770,151
Subordinated notes, net of unamortized debt issuance costs		92,078				92,042				92,006				91,970				93,913
Trust preferred subordinated debentures, net of unamortized debt issuance costs		60,276				60,274				60,273				60,272				60,271
Other liabilities		92,055				90,590				103,172				144,858				95,846
Total liabilities		7,526,677				7,705,506				7,557,009				7,556,732				7,565,941
Shareholders' equity		816,623				811,942				805,254				800,970				787,922
Total liabilities and shareholders' equity	$	8,343,300			$	8,517,448			$	8,362,263			$	8,357,702			$	8,353,863

Southside Bancshares, Inc. Consolidated Financial Highlights (Unaudited) (Dollars and shares in thousands, except per share data)
	Three Months Ended
		2025				2024
	Mar 31,				Dec 31,				Sep 30,				Jun 30,				Mar 31,
Income Statement:
Total interest and dividend income	$	100,288			$	101,689			$	105,703			$	104,186			$	102,758
Total interest expense		46,436				47,982				50,239				50,578				49,410
Net interest income		53,852				53,707				55,464				53,608				53,348
Provision for (reversal of) credit losses		758				1,384				2,389				(485	)			58
Net interest income after provision for (reversal of) credit losses		53,094				52,323				53,075				54,093				53,290
Noninterest income
Deposit services		5,829				6,084				6,199				6,157				5,985
Net gain (loss) on sale of securities available for sale		(554	)			—				(1,929	)			(563	)			(18	)
Gain (loss) on sale of loans		55				138				115				220				(436	)
Trust fees		1,765				1,773				1,628				1,456				1,336
Bank owned life insurance		799				848				857				1,767				784
Brokerage services		1,120				1,054				1,068				1,081				1,014
Other		1,209				2,384				233				1,439				1,059
Total noninterest income		10,223				12,281				8,171				11,557				9,724
Noninterest expense
Salaries and employee benefits		22,382				22,960				22,233				21,984				23,113
Net occupancy		3,404				3,629				3,613				3,750				3,362
Advertising, travel & entertainment		924				884				734				795				950
ATM expense		378				378				412				368				325
Professional fees		1,520				1,645				1,206				1,075				1,154
Software and data processing		2,839				2,931				2,951				2,860				2,856
Communications		383				320				423				410				449
FDIC insurance		947				931				939				977				943
Amortization of intangibles		223				249				278				307				337
Other		4,089				4,232				3,543				3,239				3,392
Total noninterest expense		37,089				38,159				36,332				35,765				36,881
Income before income tax expense		26,228				26,445				24,914				29,885				26,133
Income tax expense		4,721				4,659				4,390				5,212				4,622
Net income	$	21,507			$	21,786			$	20,524			$	24,673			$	21,511
Common Share Data:
Weighted-average basic shares outstanding		30,390				30,343				30,286				30,280				30,262
Weighted-average diluted shares outstanding		30,483				30,459				30,370				30,312				30,305
Common shares outstanding end of period		30,410				30,379				30,308				30,261				30,284
Earnings per common share
Basic	$	0.71			$	0.72			$	0.68			$	0.81			$	0.71
Diluted		0.71				0.71				0.68				0.81				0.71
Book value per common share		26.85				26.73				26.57				26.47				26.02
Tangible book value per common share		20.19				20.05				19.87				19.75				19.29
Cash dividends paid per common share		0.36				0.36				0.36				0.36				0.36
Selected Performance Ratios:
Return on average assets		1.03	%			1.03	%			0.98	%			1.19	%			1.03	%
Return on average shareholders’ equity		10.57				10.54				10.13				12.46				11.02
Return on average tangible common equity (1)		14.14				14.12				13.69				16.90				15.07
Average yield on earning assets (FTE) (1)		5.23				5.24				5.51				5.45				5.38
Average rate on interest bearing liabilities		3.03				3.12				3.28				3.32				3.22
Net interest margin (FTE) (1)		2.86				2.83				2.95				2.87				2.86
Net interest spread (FTE) (1)		2.20				2.12				2.23				2.13				2.16
Average earning assets to average interest bearing liabilities		128.10				129.55				128.51				128.62				127.71
Noninterest expense to average total assets		1.78				1.80				1.73				1.72				1.77
Efficiency ratio (FTE) (1)		55.04				54.00				51.90				52.71				55.54

(1)	Refer to “Non-GAAP Reconciliation” at the end of the financial statement tables in this Earnings Release for a reconciliation of this non-GAAP financial measure to the nearest GAAP financial measure.

Southside Bancshares, Inc. Consolidated Financial Highlights (Unaudited) (Dollars in thousands)
	Three Months Ended
		2025				2024
	Mar 31,				Dec 31,				Sep 30,				Jun 30,				Mar 31,
Nonperforming Assets:	$	32,193			$	3,589			$	7,656			$	6,918			$	7,979
Nonaccrual loans		4,254				3,185				7,254				6,110				7,709
Accruing loans past due more than 90 days		—				—				—				—				—
Restructured loans		27,505				2				—				145				151
Other real estate owned		388				388				388				648				119
Repossessed assets		46				14				14				15				—
Asset Quality Ratios:
Ratio of nonaccruing loans to:
Total loans		0.09	%			0.07	%			0.16	%			0.13	%			0.17	%
Ratio of nonperforming assets to:
Total assets		0.39				0.04				0.09				0.08				0.10
Total loans		0.70				0.08				0.17				0.15				0.17
Total loans and OREO		0.70				0.08				0.17				0.15				0.17
Ratio of allowance for loan losses to:
Nonaccruing loans		1,048.97				1,409.23				610.37				694.06				565.01
Nonperforming assets		138.61				1,250.60				578.32				613.00				545.90
Total loans		0.98				0.96				0.97				0.92				0.95
Net charge-offs (recoveries) to average loans outstanding		0.03				0.08				0.04				0.02				0.03
Capital Ratios:
Shareholders’ equity to total assets		9.79				9.53				9.63				9.58				9.43
Common equity tier 1 capital		13.44				13.04				13.07				12.72				12.43
Tier 1 risk-based capital		14.49				14.07				14.12				13.76				13.47
Total risk-based capital		17.01				16.49				16.59				16.16				15.92
Tier 1 leverage capital		9.73				9.67				9.61				9.40				9.22
Period end tangible equity to period end tangible assets (1)		7.54				7.33				7.38				7.33				7.17
Average shareholders’ equity to average total assets		9.75				9.76				9.67				9.52				9.35

(1)	Refer to the “Non-GAAP Reconciliation” at the end of the financial statement tables in this Earnings Release for a reconciliation of this non-GAAP financial measure to the nearest GAAP financial measure.

Southside Bancshares, Inc. Consolidated Financial Highlights (Unaudited) (Dollars in thousands)
	Three Months Ended
		2025				2024
Loan Portfolio Composition	Mar 31,				Dec 31,				Sep 30,				Jun 30,				Mar 31,
Real Estate Loans:
Construction	$	458,101			$	537,827			$	585,817			$	546,040			$	599,464
1-4 Family Residential		741,432				740,396				755,406				738,037				720,508
Commercial		2,577,229				2,579,735				2,422,612				2,472,771				2,413,345
Commercial Loans		371,643				363,167				358,854				359,807				358,053
Municipal Loans		371,271				390,968				402,041				416,986				427,225
Loans to Individuals		47,563				49,504				53,318				55,724				58,773
Total Loans	$	4,567,239			$	4,661,597			$	4,578,048			$	4,589,365			$	4,577,368
Summary of Changes in Allowances:
Allowance for Securities Held to Maturity
Balance at beginning of period	$	—			$	—			$	—			$	—			$	—
Provision for (reversal of) securities held to maturity		64				—				—				—				—
Balance at end of period	$	64			$	—			$	—			$	—			$	—
Allowance for Loan Losses
Balance at beginning of period	$	44,884			$	44,276			$	42,407			$	43,557			$	42,674
Loans charged-off		(613	)			(1,232	)			(773	)			(721	)			(634	)
Recoveries of loans charged-off		310				277				365				444				347
Net loans (charged-off) recovered		(303	)			(955	)			(408	)			(277	)			(287	)
Provision for (reversal of) loan losses		42				1,563				2,277				(873	)			1,170
Balance at end of period	$	44,623			$	44,884			$	44,276			$	42,407			$	43,557
Allowance for Off-Balance-Sheet Credit Exposures
Balance at beginning of period	$	3,141			$	3,320			$	3,208			$	2,820			$	3,932
Provision for (reversal of) off-balance-sheet credit exposures		652				(179	)			112				388				(1,112	)
Balance at end of period	$	3,793			$	3,141			$	3,320			$	3,208			$	2,820
Total Allowance for Credit Losses	$	48,480			$	48,025			$	47,596			$	45,615			$	46,377

The tables that follow show average earning assets and interest bearing liabilities together with the average yield on the earning assets and the average rate of the interest bearing liabilities for the periods presented. The interest and related yields presented are on a fully taxable-equivalent basis and are therefore non-GAAP measures. See “Non-GAAP Financial Measures” and “Non-GAAP Reconciliation” for more information.

Southside Bancshares, Inc. Average Balances and Average Yields and Rates (Annualized) (Unaudited) (Dollars in thousands)
	Three Months Ended
	March 31, 2025										December 31, 2024
	Average Balance				Interest			Average Yield/Rate (3)			Average Balance				Interest			Average Yield/Rate (3)
ASSETS
Loans (1)	$	4,625,902			$	68,160		5.98	%		$	4,604,175			$	70,155		6.06	%
Loans held for sale		752				11		5.93	%			1,562				23		5.86	%
Securities:
Taxable investment securities (2)		749,155				6,363		3.44	%			784,321				6,949		3.52	%
Tax-exempt investment securities (2)		1,134,590				10,253		3.66	%			1,138,271				10,793		3.77	%
Mortgage-backed and related securities (2)		1,041,038				13,523		5.27	%			1,031,187				12,043		4.65	%
Total securities		2,924,783				30,139		4.18	%			2,953,779				29,785		4.01	%
Federal Home Loan Bank stock, at cost, and equity investments		43,285				483		4.53	%			37,078				591		6.34	%
Interest earning deposits		319,889				3,370		4.27	%			273,656				3,160		4.59	%
Federal funds sold		43,813				478		4.42	%			43,121				508		4.69	%
Total earning assets		7,958,424				102,641		5.23	%			7,913,371				104,222		5.24	%
Cash and due from banks		89,703										102,914
Accrued interest and other assets		457,948										454,387
Less: Allowance for loan losses		(45,105	)									(44,418	)
Total assets	$	8,460,970									$	8,426,254
LIABILITIES AND SHAREHOLDERS’ EQUITY
Savings accounts	$	593,953				1,429		0.98	%		$	594,196				1,456		0.97	%
Certificates of deposit		1,336,815				14,406		4.37	%			1,187,800				13,537		4.53	%
Interest bearing demand accounts		3,406,342				21,412		2.55	%			3,459,122				23,468		2.70	%
Total interest bearing deposits		5,337,110				37,247		2.83	%			5,241,118				38,461		2.92	%
Federal Home Loan Bank borrowings		614,897				5,837		3.85	%			572,993				5,557		3.86	%
Subordinated notes, net of unamortized debt issuance costs		92,060				932		4.11	%			92,024				945		4.09	%
Trust preferred subordinated debentures, net of unamortized debt issuance costs		60,275				1,014		6.82	%			60,274				1,095		7.23	%
Repurchase agreements		75,291				666		3.59	%			80,891				782		3.85	%
Other borrowings		33,061				740		9.08	%			61,196				1,142		7.42	%
Total interest bearing liabilities		6,212,694				46,436		3.03	%			6,108,496				47,982		3.12	%
Noninterest bearing deposits		1,334,933										1,383,204
Accrued expenses and other liabilities		88,450										112,320
Total liabilities		7,636,077										7,604,020
Shareholders’ equity		824,893										822,234
Total liabilities and shareholders’ equity	$	8,460,970									$	8,426,254
Net interest income (FTE)					$	56,205									$	56,240
Net interest margin (FTE)								2.86	%									2.83	%
Net interest spread (FTE)								2.20	%									2.12	%

(1)	Interest on loans includes net fees on loans that are not material in amount.
(2)	For the purpose of calculating the average yield, the average balance of securities do not include unrealized gains and losses on AFS securities.
(3)	Yield/rate includes the impact of applicable derivatives.

Note: As of March 31, 2025 and December 31, 2024, loans totaling $4.3 million and $3.2 million, respectively, were on nonaccrual status. Our policy is to reverse previously accrued but unpaid interest on nonaccrual loans; thereafter, interest income is recorded to the extent received when appropriate.

Southside Bancshares, Inc. Average Balances and Average Yields and Rates (Annualized) (Unaudited) (Dollars in thousands)
	Three Months Ended
	September 30, 2024										June 30, 2024
	Average Balance				Interest			Average Yield/Rate (3)			Average Balance				Interest			Average Yield/Rate (3)
ASSETS
Loans (1)	$	4,613,028			$	72,493		6.25	%		$	4,595,980			$	70,293		6.15	%
Loans held for sale		871				11		5.02	%			1,489				24		6.48	%
Securities:
Taxable investment securities (2)		791,914				7,150		3.59	%			783,856				7,009		3.60	%
Tax-exempt investment securities (2)		1,174,445				11,825		4.01	%			1,254,097				12,761		4.09	%
Mortgage-backed and related securities (2)		886,325				11,976		5.38	%			830,504				11,084		5.37	%
Total securities		2,852,684				30,951		4.32	%			2,868,457				30,854		4.33	%
Federal Home Loan Bank stock, at cost, and equity investments		41,159				582		5.63	%			40,467				573		5.69	%
Interest earning deposits		281,313				3,798		5.37	%			300,047				4,105		5.50	%
Federal funds sold		33,971				488		5.71	%			75,479				1,021		5.44	%
Total earning assets		7,823,026				108,323		5.51	%			7,881,919				106,870		5.45	%
Cash and due from banks		100,578										110,102
Accrued interest and other assets		455,091										424,323
Less: Allowance for loan losses		(42,581	)									(43,738	)
Total assets	$	8,336,114									$	8,372,606
LIABILITIES AND SHAREHOLDERS’ EQUITY
Savings accounts	$	598,116				1,490		0.99	%		$	604,753				1,454		0.97	%
Certificates of deposit		1,087,613				12,647		4.63	%			1,020,099				11,630		4.59	%
Interest bearing demand accounts		3,409,911				24,395		2.85	%			3,513,068				25,382		2.91	%
Total interest bearing deposits		5,095,640				38,532		3.01	%			5,137,920				38,466		3.01	%
Federal Home Loan Bank borrowings		618,708				6,488		4.17	%			606,851				6,455		4.28	%
Subordinated notes, net of unamortized debt issuance costs		91,988				937		4.05	%			92,017				936		4.09	%
Trust preferred subordinated debentures, net of unamortized debt issuance costs		60,273				1,180		7.79	%			60,271				1,171		7.81	%
Repurchase agreements		83,297				899		4.29	%			88,007				955		4.36	%
Other borrowings		137,482				2,203		6.37	%			143,169				2,595		7.29	%
Total interest bearing liabilities		6,087,388				50,239		3.28	%			6,128,235				50,578		3.32	%
Noninterest bearing deposits		1,344,165										1,346,274
Accrued expenses and other liabilities		98,331										101,399
Total liabilities		7,529,884										7,575,908
Shareholders’ equity		806,230										796,698
Total liabilities and shareholders’ equity	$	8,336,114									$	8,372,606
Net interest income (FTE)					$	58,084									$	56,292
Net interest margin (FTE)								2.95	%									2.87	%
Net interest spread (FTE)								2.23	%									2.13	%

(1)	Interest on loans includes net fees on loans that are not material in amount.
(2)	For the purpose of calculating the average yield, the average balance of securities do not include unrealized gains and losses on AFS securities.
(3)	Yield/rate includes the impact of applicable derivatives.

Note: As of September 30, 2024 and June 30, 2024, loans totaling $7.3 million and $6.1 million, respectively, were on nonaccrual status. Our policy is to reverse previously accrued but unpaid interest on nonaccrual loans; thereafter, interest income is recorded to the extent received when appropriate.

Southside Bancshares, Inc. Average Balances and Average Yields and Rates (Annualized) (Unaudited) (Dollars in thousands)
	Three Months Ended
	March 31, 2024
	Average Balance				Interest			Average Yield/Rate (3)
ASSETS
Loans (1)	$	4,559,602			$	68,849		6.07	%
Loans held for sale		8,834				18		0.82	%
Securities:
Taxable investment securities (2)		780,423				6,967		3.59	%
Tax-exempt investment securities (2)		1,285,922				13,168		4.12	%
Mortgage-backed and related securities (2)		764,713				10,119		5.32	%
Total securities		2,831,058				30,254		4.30	%
Federal Home Loan Bank stock, at cost, and equity investments		40,063				333		3.34	%
Interest earning deposits		380,181				5,202		5.50	%
Federal funds sold		62,599				838		5.38	%
Total earning assets		7,882,337				105,494		5.38	%
Cash and due from banks		114,379
Accrued interest and other assets		441,783
Less: Allowance for loan losses		(42,973	)
Total assets	$	8,395,526
LIABILITIES AND SHAREHOLDERS’ EQUITY
Savings accounts	$	604,529				1,424		0.95	%
Certificates of deposit		941,947				10,341		4.42	%
Interest bearing demand accounts		3,634,936				26,433		2.92	%
Total interest bearing deposits		5,181,412				38,198		2.97	%
Federal Home Loan Bank borrowings		607,033				5,950		3.94	%
Subordinated notes, net of unamortized debt issuance costs		93,895				956		4.10	%
Trust preferred subordinated debentures, net of unamortized debt issuance costs		60,270				1,175		7.84	%
Repurchase agreements		92,177				967		4.22	%
Other borrowings		137,287				2,164		6.34	%
Total interest bearing liabilities		6,172,074				49,410		3.22	%
Noninterest bearing deposits		1,338,384
Accrued expenses and other liabilities		100,014
Total liabilities		7,610,472
Shareholders’ equity		785,054
Total liabilities and shareholders’ equity	$	8,395,526
Net interest income (FTE)					$	56,084
Net interest margin (FTE)								2.86	%
Net interest spread (FTE)								2.16	%

(1)	Interest on loans includes net fees on loans that are not material in amount.
(2)	For the purpose of calculating the average yield, the average balance of securities do not include unrealized gains and losses on AFS securities.
(3)	Yield/rate includes the impact of applicable derivatives.

Note: As of March 31, 2024, loans totaling $7.7 million were on nonaccrual status. Our policy is to reverse previously accrued but unpaid interest on nonaccrual loans; thereafter, interest income is recorded to the extent received when appropriate.

The following tables set forth the reconciliation of return on average common equity to return on average tangible common equity, book value per share to tangible book value per share, net interest income to net interest income adjusted to a fully taxable-equivalent basis assuming a 21% marginal tax rate for interest earned on tax-exempt assets such as municipal loans and investment securities, along with the calculation of total revenue, adjusted noninterest expense, efficiency ratio (FTE), net interest margin (FTE) and net interest spread (FTE) for the applicable periods presented.

Southside Bancshares, Inc. Non-GAAP Reconciliation (Unaudited) (Dollars and shares in thousands, except per share data)
		Three Months Ended
			2025				2024
		Mar 31,				Dec 31,				Sep 30,				Jun 30,				Mar 31,
Reconciliation of return on average common equity to return on average tangible common equity:
Net income		$	21,507			$	21,786			$	20,524			$	24,673			$	21,511
After-tax amortization expense			176				196				220				243				266
Adjusted net income available to common shareholders		$	21,683			$	21,982			$	20,744			$	24,916			$	21,777
Average shareholders' equity		$	824,893			$	822,234			$	806,230			$	796,698			$	785,054
Less: Average intangibles for the period			(202,784	)			(203,020	)			(203,288	)			(203,581	)			(203,910	)
Average tangible shareholders' equity		$	622,109			$	619,214			$	602,942			$	593,117			$	581,144
Return on average tangible common equity			14.14	%			14.12	%			13.69	%			16.90	%			15.07	%
Reconciliation of book value per share to tangible book value per share:
Common equity at end of period		$	816,623			$	811,942			$	805,254			$	800,970			$	787,922
Less: Intangible assets at end of period			(202,647	)			(202,870	)			(203,119	)			(203,397	)			(203,704	)
Tangible common shareholders' equity at end of period		$	613,976			$	609,072			$	602,135			$	597,573			$	584,218
Total assets at end of period		$	8,343,300			$	8,517,448			$	8,362,263			$	8,357,702			$	8,353,863
Less: Intangible assets at end of period			(202,647	)			(202,870	)			(203,119	)			(203,397	)			(203,704	)
Tangible assets at end of period		$	8,140,653			$	8,314,578			$	8,159,144			$	8,154,305			$	8,150,159
Period end tangible equity to period end tangible assets			7.54	%			7.33	%			7.38	%			7.33	%			7.17	%
Common shares outstanding end of period			30,410				30,379				30,308				30,261				30,284
Tangible book value per common share		$	20.19			$	20.05			$	19.87			$	19.75			$	19.29
Reconciliation of efficiency ratio to efficiency ratio (FTE), net interest margin to net interest margin (FTE) and net interest spread to net interest spread (FTE):
Net interest income (GAAP)		$	53,852			$	53,707			$	55,464			$	53,608			$	53,348
Tax-equivalent adjustments:
Loans			581				598				608				633				656
Tax-exempt investment securities			1,772				1,935				2,012				2,051				2,080
Net interest income (FTE) (1)			56,205				56,240				58,084				56,292				56,084
Noninterest income			10,223				12,281				8,171				11,557				9,724
Nonrecurring income (2)			554				(25	)			2,797				(576	)			18
Total revenue		$	66,982			$	68,496			$	69,052			$	67,273			$	65,826
Noninterest expense		$	37,089			$	38,159			$	36,332			$	35,765			$	36,881
Pre-tax amortization expense			(223	)			(249	)			(278	)			(307	)			(337	)
Nonrecurring expense (3)			(1	)			(919	)			(219	)			2				17
Adjusted noninterest expense		$	36,865			$	36,991			$	35,835			$	35,460			$	36,561
Efficiency ratio			57.04	%			56.08	%			53.94	%			54.90	%			57.95	%
Efficiency ratio (FTE) (1)			55.04	%			54.00	%			51.90	%			52.71	%			55.54	%
Average earning assets		$	7,958,424			$	7,913,371			$	7,823,026			$	7,881,919			$	7,882,337
Net interest margin			2.74	%			2.70	%			2.82	%			2.74	%			2.72	%
Net interest margin (FTE) (1)			2.86	%			2.83	%			2.95	%			2.87	%			2.86	%
Net interest spread			2.08	%			1.99	%			2.10	%			2.00	%			2.02	%
Net interest spread (FTE) (1)			2.20	%			2.12	%			2.23	%			2.13	%			2.16	%

(1)	These amounts are presented on a fully taxable-equivalent basis and are non-GAAP measures.
(2)	These adjustments may include net gain or loss on sale of securities available for sale, BOLI income related to death benefits realized and other investment income or loss in the periods where applicable.
(3)	These adjustments may include foreclosure expenses and branch closure expenses, in the periods where applicable.

FAQ

What was Southside Bancshares (SBSI) earnings per share in Q1 2025?

Southside Bancshares reported earnings of $0.71 per diluted common share for Q1 2025, maintaining the same level as Q1 2024.

How much did SBSI's deposits grow in Q1 2025 compared to Q1 2024?

SBSI's deposits increased by $45.1 million (0.7%) to $6.59 billion in Q1 2025 compared to $6.55 billion in Q1 2024.

What is Southside Bancshares (SBSI) dividend payment for Q1 2025?

Southside Bancshares declared a Q1 2025 cash dividend of $0.36 per share, paid on March 6, 2025, to shareholders of record as of February 20, 2025.

What percentage of SBSI's deposits are uninsured as of March 2025?

As of March 31, 2025, SBSI's estimated uninsured deposits were 40.0% of total deposits, but when excluding affiliate and collateralized public fund deposits, only 20.8% were without insurance or collateral.

How did SBSI's nonperforming assets change in Q1 2025?

SBSI's nonperforming assets increased significantly to $32.2 million (0.39% of total assets) in Q1 2025, up from $3.6 million in Q4 2024, primarily due to a $27.5 million restructured commercial real estate loan.

What is SBSI's loan growth forecast for 2025?

SBSI anticipates mid-single-digit loan growth for 2025, with growth expected to be heavily weighted in the second half of the year.