SPFI · South Plains Financial, Inc.

South Plains Financial reported solid first quarter 2026 results characterized by strong profitability and improving credit quality, despite a slight sequential decline in net income. Net income settled at $14.5 million, or $0.85 per diluted share, compared to $15.3 million in the prior quarter. The sequential decline was largely attributed to a $1.5 million increase in acquisition-related expenses associated with the BOH Holdings merger and a $1.8 million rise in personnel expenses. However, year-over-year performance showed marked improvement, with net income rising from $12.3 million in Q1 2025.

Net interest margin expanded to 4.04%, a 4 basis point improvement linked quarter and 23 basis points improvement year-over-year. This expansion was supported by a disciplined funding strategy, with the average cost of deposits declining 4 basis points to 1.97%. The average yield on loans increased to 6.83%, contributing to the margin strength. Asset quality metrics showed significant improvement, with the ratio of nonperforming assets to total assets dropping to 0.13% from 0.26% at year-end 2025. Annualized net charge-offs also improved to 0.04%.

A significant strategic milestone was reached with the completion of the merger with BOH Holdings, Inc. on April 1, 2026. As of March 31, 2026, BOH reported total assets of $685.0 million and total loans of $631.9 million. Management highlighted that this acquisition provides important scale in the Houston market. The Company maintained strong capital ratios, with a total risk-based capital ratio of 17.61% and a tangible book value per share of $29.65, up from $29.05 at December 31, 2025.