# SBSI earnings call intelligence

LOPJLB CallCard / temporal rollup · freemium · [stock page](https://www.lopjlb.com/stock/SBSI) · [Earnings tab](https://www.lopjlb.com/stock/SBSI?tab=earnings)

Updated: 2026-07-24T05:50:42

Quarters analyzed: 8

## Cross-quarter narrative

Across the earnings calls, SBSI's loan growth target was revised downward from 5% to 3% due to payoffs, but the company maintained a healthy loan pipeline. NIM expanded, but was pressured by prepayments and seasonal deposit outflows. The company repositioned its securities portfolio, which was delivered, and made progress on C&I hiring and wealth management expansion. However, credit quality concerns arose, particularly with multifamily loans, and the company faced competitive pressure and margin volatility. Despite these challenges, management remained optimistic about the company's prospects, with a focus on strategic M&A, subordinated note retirement, and opportunistic buybacks.

## Latest CallCard · Q1

Southside Bancshares posted solid Q1 2026 results with 2.7% loan growth, lower funding costs and a modest NIM boost, while noting substandard multifamily loans, seasonal deposit headwinds and an optimistic outlook.

**Guidance:** maintained — Management reaffirmed expectations for continued loan growth and funding‑cost savings without changing prior guidance

**Tone:** mgmt 0.6 · Q&A pressure 0.4 · divergence 0.2

Prepared remarks highlighted solid results, loan growth and optimism for 2026

### Demand visibility

Loan pipeline remains healthy but reduced to $1.3B from $2B peak

Pipeline balanced 44% term loans, 56% construction/lines; won‑but‑not‑closed $331M; focus shifting to retail and industrial projects

### Margins / costs

Net interest margin rose to 3.01% driven by lower funding costs

Redemption of $93M subordinated debt at 7.51% lowered funding costs, adding $441K net interest income and a 3‑basis‑point NIM increase

### Capital allocation

Invested in branch expansion, wealth‑management hiring and deposit strategy; no stock repurchases

Opened new Tyler branch, replaced Woodlands office with full‑service branch, hired 30‑year wealth‑management veteran, focused on wholesale funding and deposit growth

### Milestones

- **Redemption of $93M subordinated debt** [delivered]: February 15 redemption reduced funding costs and improved NIM
- **New branch in Tyler** [delivered]: Opened new branch in fast‑growing home market
- **Woodlands loan production office replacement** [delivered]: Replaced office with full‑service branch
- **Wealth‑management veteran hire** [new]: 30‑year veteran hired to build wealth‑management platform in Dallas‑Fort Worth
- **Migration of four multifamily loans to substandard** [at_risk]: Slower lease‑up and lower rents prompted reclassification

### Fears / risks

- **Credit quality**: Four multifamily loans moved to substandard due to slower lease‑up and rent declines
- **Deposit growth**: Seasonal headwinds in Q1 could limit deposit growth relative to loan growth
- **Funding cost volatility**: Future rate movements could affect anticipated funding‑cost savings
- **Competitive pressure**: Fierce competition for quality real‑estate assets may compress spreads
- **M&A integration risk**: Potential acquisitions could pose integration and cultural challenges
- **Economic slowdown in Texas**: If Texas growth slows, loan demand and retail/industrial opportunities may weaken

### Key quotes

> “Our allowance for loan losses as a percentage of total loans decreased one basis point to 0.93% at March 31.”

> “We expect to reinvest future cash flows from the securities portfolio into AFS MBS and maintain the balance of securities at approximately $2.7 billion to $2.8 billion.”

> “We have not modified our underwriting standards, but it has made it more difficult to originate new multifamily projects.” — Keith Donahoe

> “I do expect a little bit of deposit growth but believe we are going to be funding at least half of the loan growth with wholesale.” — Julie N. Shamburger

## Quarter one-liners

- **2026 Q1:** Southside Bancshares posted solid Q1 2026 results with 2.7% loan growth, lower funding costs and a modest NIM boost, while noting substandard multifamily loans, seasonal deposit headwinds and an optimistic outlook.
- **2025 Q4:** Southside Bancshares posted a strong Q4 with higher net income and NIM expansion, completed securities restructuring, and a rebounding loan pipeline, while noting modest payoffs and a muted Q1 margin outlook.
- **2025 Q3:** Southside Bancshares posted a 77.5% drop in net income, modest loan growth and a securities portfolio restructuring, while management remains optimistic about a slightly higher NIM in Q4 despite competitive pricing pressure.
- **2025 Q2:** SBSI reports strong Q2 with EPS $0.72, NIM +9bps to 2.95%, loan pipeline $2.1B but guidance lowered to 3-4% YoY due to unpredictable payoffs; deposit growth solid, credit quality stable.','tone': {'mgmt': 0.7, 'mgmt_rationale': 'Prepared remarks emphasize "excellent quarter", "overall, we remain opt
- **2025 Q1:** SBSI Q1: net income $21.5M, EPS $0.71; loans -2% QoQ on CRE payoffs but $1.9B pipeline supports mid-single-digit growth; NIM +3bps to 2.86%; credit solid; buyback resumed.','tone': {'mgmt': 0.3, 'mgmt_rationale': 'Prepared remarks highlight solid Q1 results, largest loan pipeline in years, maintaine
- **2024 Q4:** Southside Bancshares posted modest earnings growth, highlighted healthy loan pipeline and mid‑single‑digit loan growth guidance, while noting NIM pressure from prepayments, a restructuring of its MBS portfolio, and a cautious stance on share buybacks.
- **2024 Q3:** SBSI Q3 net income $20.5M, EPS $0.68, NIM up 8bps to 2.95%; loan growth target cut to 3% from 5% due to payoffs; C&I hiring progressing; securities portfolio repositioned. Asset quality strong but CECL reserves up for office/multifamily. No buybacks; 583k shares remain authorized. Margin expected bu
- **2024 Q2:** SBSI Q2: EPS $0.81, NIM +1bp to 2.87%, loan growth 1.1% annualized, targeting 5% for 2024; securities repositioning to boost Q3 NIM, C&I expansion in Houston underway, expense guidance $37M/qtr for H2, asset quality pristine.','tone': {'mgmt': 0.3, 'mgmt_rationale': 'Management highlighted solid ear

## Theme arcs

- **Loan Growth** (deteriorating): Revised downward from 5% to 3% due to payoffs
- **NIM Expansion** (improving): Expanded, but pressured by prepayments and seasonal deposit outflows
- **Credit Quality** (deteriorating): Concerns arose, particularly with multifamily loans
- **Competitive Pressure** (deteriorating): Faced intense competition in CRE and C&I pricing
- **Management Optimism** (stable): Remained optimistic about the company's prospects

## Fear persistence

- **Loan Payoff Risk** [recurring]: Large payoffs in CRE and municipal loans caused linked-quarter loan decline
- **Margin Volatility** [recurring]: NIM expected to be bumpy due to loss of seasonal low-cost deposit account and uncertainty around Fed rate cuts
- **Credit Risk** [recurring]: Concerns arose, particularly with multifamily loans
- **M&A Regulatory Uncertainty** [resolved]: No longer mentioned as a concern
- **Interest Rate Risk** [recurring]: Potential further Fed rate cuts or holds affect deposit beta and NIM expectations
- **Deposit Rate Risk** [recurring]: Deposit rate repricing depends on Fed cuts and CD maturities

## Guidance path

2024 Q2:vague → 2024 Q3:lowered → 2024 Q4:maintained → 2025 Q1:vague → 2025 Q2:vague → 2025 Q3:maintained → 2025 Q4:maintained → 2026 Q1:maintained

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