Southside Bancshares, Inc. Announces Financial Results for the First Quarter Ended March 31, 2026

Published: 2026-04-30 05:46:09 ET SBSI

First quarter net income of $23.3 million; First quarter earnings per diluted common share of $0.78; Linked quarter loan growth of 2.7%; Tax-equivalent net interest margin(1) linked quarter increased three basis points to 3.01%; Annualized return on first quarter average assets of 1.10%; Annualized return on first quarter average shareholders’ equity of 10.96% and average tangible common equity(1) of 14.39%; and Nonperforming assets decreased to 0.11% of total assets.

Published on 04/30/2026 at 05:46 am EDT

Southside Bancshares, Inc. (“Southside” or the “Company”) (NYSE: SBSI) today reported its financial results for the quarter ended March 31, 2026.

“We are pleased to report solid financial results for the first quarter ended March 31, 2026, which include linked quarter loan growth of 2.7%, earnings per share of $0.78, a return on average assets of 1.10% and a return on average tangible common equity of 14.39%,” stated Keith Donahoe, President and Chief Executive Officer of Southside. “Linked quarter, net interest income increased $441,000 to $57.7 million, and our net interest margin increased three basis points to 3.01% due to lower funding costs during the quarter. We expect further savings on our funding costs during the second quarter after the redemption in February of our $93 million subordinated notes due 2030 which had an interest rate of 7.51%.”

Operating Results for the Three Months Ended March 31, 2026

Net income was $23.3 million for the three months ended March 31, 2026, compared to $21.5 million for the same period in 2025, an increase of $1.8 million, or 8.1%. Earnings per diluted common share were $0.78 for the three months ended March 31, 2026, compared to $0.71 for the same period in 2025, an increase of $0.07, or 9.9%. The increase in net income was due to increases in net interest income and noninterest income, partially offset by increases in noninterest expense, provision for credit losses and income tax expense. Annualized returns on average assets and average shareholders’ equity for the three months ended March 31, 2026 were 1.10% and 10.96%, respectively, compared to 1.03% and 10.57%, respectively, for the three months ended March 31, 2025. Our efficiency ratio and tax-equivalent efficiency ratio(1) were 56.44% and 54.98%, respectively, for the three months ended March 31, 2026, compared to 57.04% and 55.04%, respectively, for the three months ended March 31, 2025, and 53.85% and 52.28%, respectively, for the three months ended December 31, 2025.

Net interest income for the three months ended March 31, 2026 was $57.7 million, an increase of $3.8 million, or 7.1%, compared to the same period in 2025. The increase in net interest income was primarily due to a decrease in the average rate paid on our interest bearing liabilities and an increase in the volume and change in the mix of our interest earning assets, partially offset by an increase in the average balance of our interest bearing liabilities. Linked quarter, net interest income increased $0.4 million, or 0.8%, compared to $57.2 million for the three months ended December 31, 2025.

Our net interest margin and tax-equivalent net interest margin(1) increased to 2.91% and 3.01%, respectively, for the three months ended March 31, 2026, compared to 2.74% and 2.86%, respectively, for the same period in 2025, and increased from 2.87% and 2.98%, respectively, for the three months ended December 31, 2025.

Noninterest income was $12.6 million for the three months ended March 31, 2026, an increase of $2.4 million, or 23.2%, compared to $10.2 million for the same period in 2025. There were increases to all noninterest income categories, however, the primary increases occurred in other noninterest income, trust fees and a decrease in net loss on sale of securities available for sale (“AFS”) securities. On a linked quarter basis, noninterest income increased $7.0 million, or 125.8%, compared to the three months ended December 31, 2025, due to a $7.3 million net loss on the sale of AFS securities during the fourth quarter of 2025 and an increase in other noninterest income, partially offset by a decrease in deposit services income during the three months ended March 31, 2026.

Noninterest expense increased $3.5 million, or 9.4%, to $40.6 million for the three months ended March 31, 2026, compared to $37.1 million for the same period in 2025. On a linked quarter basis, noninterest expense increased by $3.1 million or 8.3%, compared to the three months ended December 31, 2025. The increase for both periods was primarily due to increases in salaries and employee benefits expense, loss on redemption of subordinated notes, other noninterest expense and software and data processing expense.

Income tax expense increased $0.3 million, or 6.8%, for the three months ended March 31, 2026, compared to the same period in 2025. On a linked quarter basis, income tax expense increased $1.3 million, or 33.3%. Our effective tax rate (“ETR”) decreased slightly to 17.8% for the three months ended March 31, 2026, compared to 18.0% for the three months ended March 31, 2025, and increased from 15.3% for the three months ended December 31, 2025. The marginally lower ETR for the three months ended March 31, 2026 compared to the same period in 2025 was partially due to a decrease in state income tax expense as a percentage of pre-tax income. The higher ETR for the linked quarter was primarily due to the decrease in tax-free income as a percentage of pre-tax income when compared to the three months ended December 31, 2025.

Balance Sheet Data

At March 31, 2026, Southside had $8.80 billion in total assets, compared to $8.34 billion at March 31, 2025 and $8.51 billion at December 31, 2025.

Loans at March 31, 2026 were $4.95 billion, an increase of $378.9 million, or 8.3%, compared to $4.57 billion at March 31, 2025. Linked quarter, loans increased $128.2 million, or 2.7%, due to increases of $93.2 million in construction loans, $40.6 million in commercial real estate loans and $12.2 million in commercial loans. These increases were partially offset by decreases of $9.6 million in municipal loans, $7.1 million in 1-4 family residential loans and $1.2 million in loans to individuals.

Securities at March 31, 2026 were $2.87 billion, an increase of $131.8 million, or 4.8%, compared to $2.74 billion at March 31, 2025. Linked quarter, securities increased $164.3 million, or 6.1%, from $2.70 billion at December 31, 2025.

Deposits at March 31, 2026 were $6.87 billion, an increase of $283.6 million, or 4.3%, compared to $6.59 billion at March 31, 2025, primarily due to the increase of $236.8 million in brokered deposits and a $186.1 million increase in retail deposits, partially offset by a decrease of $139.2 million in public fund deposits. Linked quarter, deposits increased $9.3 million, or 0.1%, compared to $6.87 billion at December 31, 2025, primarily due to an increase in brokered deposits of $110.7 million, or 16.5%, partially offset by decreases in retail deposits of $82.0 million, or 1.6%, and public fund deposits of $19.4 million, or 1.7%.

At March 31, 2026, we had 178,823 total deposit accounts with an average balance of $34,000. Our estimated uninsured deposits were 38.4% of total deposits as of March 31, 2026. When excluding affiliate deposits (Southside-owned deposits) and public fund deposits (all collateralized), our total estimated deposits without insurance or collateral was 21.9% as of March 31, 2026. Our noninterest bearing deposits represent approximately 20.0% of total deposits. Linked quarter, our cost of interest bearing deposits decreased eight basis points from 2.73% in the prior quarter to 2.65%. Linked quarter, our cost of total deposits decreased three basis points from 2.16% in the prior quarter to 2.13%.

Our cost of interest bearing deposits decreased 18 basis points, from 2.83% for the three months ended March 31, 2025, to 2.65% for the three months ended March 31, 2026. Our cost of total deposits decreased 13 basis points, from 2.26% for the three months ended March 31, 2025, to 2.13% for the three months ended March 31, 2026.

Capital Resources and Liquidity

Our capital ratios and contingent liquidity sources remain solid. During the first quarter ended March 31, 2026, we did not repurchase any common stock, pursuant to our Stock Repurchase Plan (the “Plan”). Under the 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 Plan and may modify, suspend or discontinue the Plan at any time. As of March 31, 2026, approximately 0.8 million authorized shares remained available for repurchase. We have not repurchased any common stock pursuant to the Plan subsequent to March 31, 2026.

As of March 31, 2026, our total available contingent liquidity, net of current outstanding borrowings, was $2.68 billion, consisting of FHLB advances, Federal Reserve Discount Window and correspondent bank lines of credit.

Asset Quality

Nonperforming assets at March 31, 2026 were $9.7 million, or 0.11% of total assets, a decrease of $28.5 million, or 74.6%, from $38.2 million, or 0.45% of total assets, at December 31, 2025, due primarily to a decrease of $27.5 million in restructured loans. The decrease in restructured loans was due to the payoff of a $27.5 million restructured commercial real estate loan in the first quarter that was originally restructured with an extension of maturity in the first quarter of 2025 to allow for an extended lease up period. Nonperforming assets decreased $22.5 million, or 69.8%, compared to $32.2 million, or 0.39% of total assets, at March 31, 2025.

The allowance for loan losses totaled $46.0 million, or 0.93% of total loans, at March 31, 2026, compared to $45.1 million, or 0.94% of total loans, at December 31, 2025. The allowance for loan losses was $44.6 million, or 0.98% of total loans, at March 31, 2025. The decrease in allowance as a percentage of total loans compared to December 31, 2025 was due to both improvements in the overall economic forecast within the CECL model as well as improvements in the financial metrics of the borrowers in our commercial loan portfolio.

For the three months ended March 31, 2026, we recorded a provision for credit losses for loans of $1.0 million, compared to $42,000 and $0.6 million for the three months ended March 31, 2025 and December 31, 2025, respectively. Net charge-offs were $0.2 million for the three months ended March 31, 2026, compared to net charge-offs of $0.3 million and $0.8 million for the three months ended March 31, 2025 and December 31, 2025, respectively.

We recorded a provision for credit losses on off-balance-sheet credit exposures of $0.4 million for the three months ended March 31, 2026, compared to $0.7 million and $17,000 for the three months ended March 31, 2025 and December 31, 2025, respectively. The balance of the allowance for off-balance-sheet credit exposures was $3.6 million and $3.8 million at March 31, 2026 and 2025, respectively, and is included in other liabilities.

Dividend

Southside Bancshares, Inc. declared a first quarter cash dividend of $0.36 per share on February 5, 2026, which was paid on March 5, 2026, to all shareholders of record as of February 19, 2026.

_______________

(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, 2026 financial results on Thursday, April 30, 2026 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://events.q4inc.com/analyst/221321903?pwd=CNyH%3B3vm 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 return on average tangible common equity and 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.

Return on average tangible common equity. Return on average tangible common equity is a non-GAAP measure that calculates the return available to common shareholders without the impact of intangible assets and their related amortization, thereby allowing management to evaluate the performance of the business consistently.

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 that (i) adjusting return on average shareholders’ equity for the impact of intangible assets and their related amortization and (ii) adjusting net interest income, net interest margin and net interest spread to a fully taxable-equivalent basis are standard practices 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 $8.80 billion in assets as of March 31, 2026, that owns 100% of Southside Bank. Southside Bank currently has 55 branches in Texas and operates a network of 71 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 [email protected].

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, 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 factors that could cause future results to differ materially from those anticipated by our forward-looking statements include: general economic conditions in our markets, including the ongoing impact of higher inflation levels, including higher energy and gas prices, interest rate fluctuations, including the impact of changes in interest rates on our financial projections, models and guidance, 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 to 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; the extensive regulations the Company is subject to and legislative and regulatory changes; the Company’s ability to successfully execute its business strategy; including risks related to potential acquisitions; the Company’s ability to innovate, to anticipate the needs of our current and future customers and to manage increased or expanded competition from banks and other financial service providers in its markets; the Company’s ability to effectively manage information technology systems, including third party vendors, cyber or data privacy incidents or other failures, outages, disruptions or security breaches; the Company’s ability to use technology to provide products and services to its customers; adverse developments in the banking industry and the potential impact of such developments on customer confidence, liquidity and regulatory responses to these developments, including in the context of regulatory examinations and related findings and actions; negative press and social media attention with respect to the banking industry or the Company, in particular; claims, litigation or regulatory investigations and actions that the Company may become subject to; the failure to identify, attract and retain key personnel and other employees and to engage in adequate succession planning; the Company’s recent executive transition; and the additional risks included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025, 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

2026

2025

Mar 31,

Dec 31,

Sep 30,

Jun 30,

Mar 31,

ASSETS

Cash and due from banks

72,997

81,080

90,519

109,669

103,359

Interest earning deposits

296,986

302,906

365,263

260,357

293,364

Federal funds sold

17,490

5,800

11,130

20,069

34,248

Securities available for sale, at estimated fair value

1,647,379

1,456,219

1,292,431

1,457,124

1,457,939

Securities held to maturity, at net carrying value

1,220,641

1,247,477

1,263,401

1,272,906

1,278,330

Total securities

2,868,020

2,703,696

2,555,832

2,730,030

2,736,269

Federal Home Loan Bank stock, at cost

16,372

14,062

9,359

24,384

34,208

Loans held for sale

1,478

1,332

497

428

903

Loans

4,946,161

4,817,991

4,765,289

4,601,933

4,567,239

Less: Allowance for loan losses

(45,963

)

(45,100

)

(45,294

)

(44,421

)

(44,623

)

Net loans

4,900,198

4,772,891

4,719,995

4,557,512

4,522,616

Premises & equipment, net

154,318

152,293

147,187

147,263

142,245

Goodwill

201,116

Other intangible assets, net

880

1,012

1,161

1,333

1,531

Bank owned life insurance

145,991

145,125

139,697

138,826

137,962

Other assets

126,336

133,277

141,404

148,979

135,479

Total assets

8,802,182

8,514,590

8,383,160

8,339,966

8,343,300

LIABILITIES AND SHAREHOLDERS' EQUITY

Noninterest bearing deposits

1,374,190

1,433,129

1,411,764

1,368,453

1,379,641

Interest bearing deposits

5,500,303

5,432,030

5,549,823

5,263,511

5,211,210

Total deposits

6,874,493

6,865,159

6,961,587

6,631,964

6,590,851

Other borrowings and Federal Home Loan Bank borrowings

671,466

419,793

200,706

611,367

691,417

Subordinated notes, net of unamortized debt issuance costs

147,541

239,678

239,601

92,115

92,078

Trust preferred subordinated debentures, net of unamortized debt issuance costs

60,280

60,279

60,278

60,277

60,276

Other liabilities

193,540

82,066

86,138

137,043

92,055

Total liabilities

7,947,320

7,666,975

7,548,310

7,532,766

7,526,677

Shareholders' equity

854,862

847,615

834,850

807,200

816,623

Total liabilities and shareholders' equity

8,802,182

8,514,590

8,383,160

8,339,966

8,343,300

Southside Bancshares, Inc.

Consolidated Financial Highlights (Unaudited)

(Dollars and shares in thousands, except per share data)

Three Months Ended

2026

2025

Mar 31,

Dec 31,

Sep 30,

Jun 30,

Mar 31,

Income Statement:

Total interest and dividend income

102,256

102,328

101,896

98,562

100,288

Total interest expense

44,567

45,080

46,178

44,296

46,436

Net interest income

57,689

57,248

55,718

54,266

53,852

Provision for (reversal of) credit losses

1,410

581

1,092

622

758

Net interest income after provision for (reversal of) credit losses

56,279

56,667

54,626

53,644

53,094

Noninterest income

Deposit services

5,931

6,415

6,069

6,125

5,829

Net gain (loss) on sale of securities available for sale

—

(7,321

)

(24,395

)

—

(554

)

Gain (loss) on sale of loans

118

122

164

Trust fees

2,202

2,148

2,081

1,879

1,765

Bank owned life insurance

986

1,134

871

833

799

Brokerage services

1,363

1,348

1,172

1,219

1,120

Other

1,996

1,732

2,048

1,990

1,209

Total noninterest income (loss)

12,596

5,578

(11,990

)

12,145

10,223

Noninterest expense

Salaries and employee benefits

24,332

22,816

22,803

22,272

22,382

Net occupancy

3,459

3,715

3,761

3,621

3,404

Advertising, travel & entertainment

1,043

1,147

907

950

924

ATM expense

430

319

444

405

378

Professional fees

1,485

1,343

1,451

1,401

1,520

Software and data processing

3,097

2,859

2,770

3,027

2,839

Communications

287

273

321

342

383

FDIC insurance

937

920

955

947

Amortization of intangibles

132

149

172

198

223

Loss on redemption of subordinated notes

791

—

Other

4,583

3,919

3,985

6,086

4,089

Total noninterest expense

40,576

37,477

37,534

39,257

37,089

Income before income tax expense

28,299

24,768

5,102

26,532

26,228

Income tax expense

5,040

3,781

189

4,719

4,721

Net income

23,259

20,987

4,913

21,813

21,507

Common Share Data:

Weighted-average basic shares outstanding

29,734

29,863

30,067

30,234

30,390

Weighted-average diluted shares outstanding

29,832

29,943

30,135

30,308

30,483

Common shares outstanding end of period

29,752

29,723

30,066

30,082

30,410

Earnings per common share

Basic

0.78

0.70

0.16

0.72

0.71

Diluted

0.78

0.70

0.16

0.72

0.71

Book value per common share

28.73

28.52

27.77

26.83

26.85

Tangible book value per common share

21.94

21.72

21.04

20.10

20.19

Cash dividends paid per common share

0.36

Selected Performance Ratios:

Return on average assets

1.10

0.99

0.23

1.07

1.03

Return on average shareholders’ equity

10.96

9.85

2.40

10.73

10.57

Return on average tangible common equity (1)

14.39

13.03

3.28

14.38

14.14

Average yield on earning assets (FTE) (1)

5.26

5.24

5.27

5.25

5.23

Average rate on interest bearing liabilities

2.88

2.93

3.01

2.98

3.03

Net interest margin (FTE) (1)

3.01

2.98

2.94

2.95

2.86

Net interest spread (FTE) (1)

2.38

2.31

2.26

2.27

2.20

Average earning assets to average interest bearing liabilities

127.84

129.69

129.13

129.33

128.10

Noninterest expense to average total assets

1.92

1.76

1.78

1.92

1.78

Efficiency ratio (FTE) (1)

54.98

52.28

52.99

53.70

55.04

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

2026

2025

Mar 31,

Dec 31,

Sep 30,

Jun 30,

Mar 31,

Nonperforming Assets:

9,728

38,243

35,608

32,909

32,193

Nonaccrual loans

9,559

10,486

7,955

4,998

4,254

Accruing loans past due more than 90 days

—

Restructured loans

27,509

27,501

27,512

27,505

Other real estate owned

128

248

128

380

388

Repossessed assets

—

Asset Quality Ratios:

Ratio of nonaccruing loans to:

Total loans

0.19

0.22

0.17

0.11

0.09

Ratio of nonperforming assets to:

Total assets

0.11

0.45

0.42

0.39

Total loans

0.20

0.79

0.75

0.72

0.70

Total loans and OREO

0.20

0.79

0.75

0.72

0.70

Ratio of allowance for loan losses to:

Nonaccruing loans

480.83

430.10

569.38

888.78

1,048.97

Nonperforming assets

472.48

117.93

127.20

134.98

138.61

Total loans

0.93

0.94

0.95

0.97

0.98

Net charge-offs (recoveries) to average loans outstanding

0.01

0.07

0.08

0.03

Capital Ratios:

Shareholders’ equity to total assets

9.71

9.95

9.96

9.68

9.79

Common equity tier 1 capital

12.68

12.87

12.97

13.36

13.44

Tier 1 risk-based capital

13.66

13.88

13.99

14.41

14.49

Total risk-based capital

16.95

18.54

19.01

16.91

17.01

Tier 1 leverage capital

9.74

9.72

9.78

10.03

9.73

Period end tangible equity to period end tangible assets (1)

7.59

7.77

7.73

7.43

7.54

Average shareholders’ equity to average total assets

10.02

10.00

9.72

9.94

9.75

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

2026

2025

Loan Portfolio Composition

Mar 31,

Dec 31,

Sep 30,

Jun 30,

Mar 31,

Real Estate Loans:

Construction

641,818

548,570

519,528

470,380

458,101

1-4 Family Residential

717,298

724,354

730,061

736,108

741,432

Commercial

2,753,421

2,712,816

2,688,712

2,606,072

2,577,229

Commercial Loans

456,896

444,720

429,952

380,612

371,643

Municipal Loans

337,089

346,720

353,324

363,746

371,271

Loans to Individuals

39,639

40,811

43,712

45,015

47,563

Total Loans

4,946,161

4,817,991

4,765,289

4,601,933

4,567,239

Summary of Changes in Allowances:

Allowance for Securities Held to Maturity

Balance at beginning of period

—

Provision for (reversal of) securities held to maturity

—

(30

)

—

)

Balance at end of period

Allowance for Loan Losses

Balance at beginning of period

45,100

45,294

44,421

44,623

44,884

Loans charged-off

(680

)

(1,115

)

(1,335

)

(1,194

)

(613

)

Recoveries of loans charged-off

529

327

491

342

310

Net loans (charged-off) recovered

(151

)

(788

)

(844

)

(852

)

(303

)

Provision for (reversal of) loan losses

1,014

594

1,717

650

Balance at end of period

45,963

45,100

45,294

44,421

44,623

Allowance for Off-Balance-Sheet Credit Exposures

Balance at beginning of period

3,166

3,149

3,774

3,793

3,141

Provision for (reversal of) off-balance-sheet credit exposures

396

(625

)

(19

)

652

Balance at end of period

3,562

3,166

3,149

3,774

3,793

Total Allowance for Credit Losses

49,550

48,291

48,498

48,250

48,480

Southside Bancshares, Inc.

Average Balances and Average Yields and Rates (Annualized) (Unaudited)

(Dollars in thousands)

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.

Three Months Ended

March 31, 2026

December 31, 2025

Average Balance

Interest

Average Yield/ Rate (3)

Average Balance

Interest

Average Yield/ Rate (3)

ASSETS

Loans (1)

4,879,867

71,515

5.94

4,788,584

71,616

5.93

Loans held for sale

792

5.63

675

7.05

Securities:

Taxable investment securities (2)

578,480

4,649

3.26

593,393

4,835

3.23

Tax-exempt investment securities (2)

865,279

7,484

3.51

893,382

7,939

3.53

Mortgage-backed and related securities (2)

1,418,491

17,908

5.12

1,284,064

16,493

5.10

Total securities

2,862,250

30,041

4.26

2,770,839

29,267

4.19

Federal Home Loan Bank stock, at cost, and equity investments

21,693

249

4.66

23,287

441

7.51

Interest earning deposits

258,860

2,235

3.50

313,810

3,019

3.82

Federal funds sold

7,984

3.61

6,906

3.96

Total earning assets

8,031,446

104,122

5.26

7,904,101

104,424

5.24

Cash and due from banks

82,443

82,585

Accrued interest and other assets

521,219

508,578

Less: Allowance for loan losses

(45,491

)

(45,559

)

Total assets

8,589,617

8,449,705

LIABILITIES AND SHAREHOLDERS’ EQUITY

Savings accounts

683,270

2,370

1.41

647,035

2,061

1.26

Certificates of deposit

1,328,312

12,402

3.79

1,372,879

13,857

4.00

Interest bearing demand accounts

3,588,863

21,791

2.46

3,474,451

21,827

2.49

Total interest bearing deposits

5,600,445

36,563

2.65

5,494,365

37,745

2.73

Federal Home Loan Bank borrowings

144,008

975

2.75

187,725

1,274

2.69

Subordinated notes, net of unamortized debt issuance costs

195,664

3,577

7.41

239,648

4,022

6.66

Trust preferred subordinated debentures, net of unamortized debt issuance costs

60,280

915

6.16

60,278

980

6.45

Repurchase agreements

92,622

784

3.43

97,637

866

3.52

Other borrowings

189,444

1,753

3.75

14,826

193

5.16

Total interest bearing liabilities

6,282,463

44,567

2.88

6,094,479

45,080

2.93

Noninterest bearing deposits

1,363,826

1,423,350

Accrued expenses and other liabilities

82,948

86,863

Total liabilities

7,729,237

7,604,692

Shareholders’ equity

860,380

845,013

Total liabilities and shareholders’ equity

8,589,617

8,449,705

Net interest income (FTE)

59,555

59,344

Net interest margin (FTE)

3.01

2.98

Net interest spread (FTE)

2.38

2.31

Interest on loans includes net fees on loans that are not material in amount.

For the purpose of calculating the average yield, the average balance of securities do not include unrealized gains and losses on AFS securities.

Yield/rate includes the impact of applicable derivatives.

Note: As of March 31, 2026 and December 31, 2025, loans totaling $9.6 million and $10.5 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, 2025

June 30, 2025

Average Balance

Interest

Average Yield/ Rate (3)

Average Balance

Interest

Average Yield/ Rate (3)

ASSETS

Loans (1)

4,640,220

70,240

6.01

4,519,668

67,798

6.02

Loans held for sale

776

6.14

1,108

5.79

Securities:

Taxable investment securities (2)

669,712

5,578

3.30

735,669

6,205

3.38

Tax-exempt investment securities (2)

1,094,978

10,097

3.66

1,130,903

10,351

3.67

Mortgage-backed and related securities (2)

1,058,860

14,174

5.31

1,003,887

13,040

5.21

Total securities

2,823,550

29,849

4.19

2,870,459

29,596

4.14

Federal Home Loan Bank stock, at cost, and equity investments

37,937

374

3.91

31,169

524

6.74

Interest earning deposits

334,523

3,631

4.31

259,617

2,753

4.25

Federal funds sold

17,546

195

4.41

27,778

308

4.45

Total earning assets

7,854,552

104,301

5.27

7,709,799

100,995

5.25

Cash and due from banks

87,815

84,419

Accrued interest and other assets

455,884

452,573

Less: Allowance for loan losses

(44,476

)

(44,747

)

Total assets

8,353,775

8,202,044

LIABILITIES AND SHAREHOLDERS’ EQUITY

Savings accounts

618,059

1,772

1.14

596,125

1,451

0.98

Certificates of deposit

1,505,292

15,752

4.15

1,407,017

14,905

4.25

Interest bearing demand accounts

3,320,993

21,234

2.54

3,311,330

21,071

2.55

Total interest bearing deposits

5,444,344

38,758

2.82

5,314,472

37,427

2.82

Federal Home Loan Bank borrowings

298,138

2,847

3.79

394,119

3,721

3.79

Subordinated notes, net of unamortized debt issuance costs

169,196

2,319

5.44

92,097

935

4.07

Trust preferred subordinated debentures, net of unamortized debt issuance costs

60,277

1,025

6.75

60,276

1,015

6.75

Repurchase agreements

75,207

662

3.49

72,295

634

3.52

Other borrowings

35,544

567

6.33

28,022

564

8.07

Total interest bearing liabilities

6,082,706

46,178

3.01

5,961,281

44,296

2.98

Noninterest bearing deposits

1,375,075

1,339,463

Accrued expenses and other liabilities

83,601

85,827

Total liabilities

7,541,382

7,386,571

Shareholders’ equity

812,393

815,473

Total liabilities and shareholders’ equity

8,353,775

8,202,044

Net interest income (FTE)

58,123

56,699

Net interest margin (FTE)

2.94

2.95

Net interest spread (FTE)

2.26

2.27

Interest on loans includes net fees on loans that are not material in amount.

For the purpose of calculating the average yield, the average balance of securities do not include unrealized gains and losses on AFS securities.

Yield/rate includes the impact of applicable derivatives.

Note: As of September 30, 2025 and June 30, 2025, loans totaling $8.0 million and $5.0 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, 2025

Average Balance

Interest

Average Yield/ Rate (3)

ASSETS

Loans (1)

4,625,902

68,160

5.98

Loans held for sale

752

5.93

Securities:

Taxable investment securities (2)

749,155

6,363

3.44

Tax-exempt investment securities (2)

1,134,590

10,253

3.66

Mortgage-backed and related securities (2)

1,041,038

13,523

5.27

Total securities

2,924,783

30,139

4.18

Federal Home Loan Bank stock, at cost, and equity investments

43,285

483

4.53

Interest earning deposits

319,889

3,370

4.27

Federal funds sold

43,813

478

4.42

Total earning assets

7,958,424

102,641

5.23

Cash and due from banks

89,703

Accrued interest and other assets

457,948

Less: Allowance for loan losses

(45,105

)

Total assets

8,460,970

LIABILITIES AND SHAREHOLDERS’ EQUITY

Savings accounts

593,953

1,429

0.98

Certificates of deposit

1,336,815

14,406

4.37

Interest bearing demand accounts

3,406,342

21,412

2.55

Total interest bearing deposits

5,337,110

37,247

2.83

Federal Home Loan Bank borrowings

614,897

5,837

3.85

Subordinated notes, net of unamortized debt issuance costs

92,060

932

4.11

Trust preferred subordinated debentures, net of unamortized debt issuance costs

60,275

1,014

6.82

Repurchase agreements

75,291

666

3.59

Other borrowings

33,061

740

9.08

Total interest bearing liabilities

6,212,694

46,436

3.03

Noninterest bearing deposits

1,334,933

Accrued expenses and other liabilities

88,450

Total liabilities

7,636,077

Shareholders’ equity

824,893

Total liabilities and shareholders’ equity

8,460,970

Net interest income (FTE)

56,205

Net interest margin (FTE)

2.86

Net interest spread (FTE)

2.20

Interest on loans includes net fees on loans that are not material in amount.

For the purpose of calculating the average yield, the average balance of securities do not include unrealized gains and losses on AFS securities.

Yield/rate includes the impact of applicable derivatives.

Note: As of March 31, 2025, loans totaling $4.3 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.

Southside Bancshares, Inc.

Non-GAAP Reconciliation (Unaudited)

(Dollars and shares in thousands, except per share data)

The following tables set forth the reconciliation of return on average shareholders’ 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.

Three Months Ended

2026

2025

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

23,259

20,987

4,913

21,813

21,507

After-tax amortization expense

104

117

136

157

176

Adjusted net income available to common shareholders

23,363

21,104

5,049

21,970

21,683

Average shareholders' equity

860,380

845,013

812,393

815,473

824,893

Less: Average intangibles for the period

(202,078

)

(202,217

)

(202,380

)

(202,569

)

(202,784

)

Average tangible shareholders' equity

658,302

642,796

610,013

612,904

622,109

Return on average shareholders’ equity

10.96

9.85

2.40

10.73

10.57

Return on average tangible common equity

14.39

13.03

3.28

14.38

14.14

Reconciliation of book value per share to tangible book value per share:

Common equity at end of period

854,862

847,615

834,850

807,200

816,623

Less: Intangible assets at end of period

(201,996

)

(202,128

)

(202,277

)

(202,449

)

(202,647

)

Tangible common shareholders' equity at end of period

652,866

645,487

632,573

604,751

613,976

Total assets at end of period

8,802,182

8,514,590

8,383,160

8,339,966

8,343,300

Less: Intangible assets at end of period

(201,996

)

(202,128

)

(202,277

)

(202,449

)

(202,647

)

Tangible assets at end of period

8,600,186

8,312,462

8,180,883

8,137,517

8,140,653

Period end tangible equity to period end tangible assets

7.59

7.77

7.73

7.43

7.54

Common shares outstanding end of period

29,752

29,723

30,066

30,082

30,410

Tangible book value per common share

21.94

21.72

21.04

20.10

20.19

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)

57,689

57,248

55,718

54,266

53,852

Tax-equivalent adjustments:

Loans

538

545

553

565

581

Tax-exempt investment securities

1,328

1,551

1,852

1,868

1,772

Net interest income (FTE) (1)

59,555

59,344

58,123

56,699

56,205

Noninterest income

12,596

5,578

(11,990

)

12,145

10,223

Nonrecurring income (2)

(47

)

7,066

24,395

—

554

Total revenue

72,104

71,988

70,528

68,844

66,982

Noninterest expense

40,576

37,477

37,534

39,257

37,089

Pre-tax amortization expense

(132

)

(149

)

(172

)

(198

)

(223

)

Nonrecurring expense (3)

(799

)

306

(2,090

)

Adjusted noninterest expense

39,645

37,634

37,376

36,969

36,865

Efficiency ratio

56.44

53.85

54.87

55.67

57.04

Efficiency ratio (FTE) (1)

54.98

52.28

52.99

53.70

55.04

Average earning assets

8,031,446

7,904,101

7,854,552

7,709,799

7,958,424

Net interest margin

2.91

2.87

2.81

2.82

2.74

Net interest margin (FTE) (1)

3.01

2.98

2.94

2.95

2.86

Net interest spread

2.28

2.21

2.14

2.15

2.08

Net interest spread (FTE) (1)

2.38

2.31

2.26

2.27

2.20

(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 loss on redemption of subordinated notes, foreclosure expenses, branch closure expenses and other miscellaneous expense, in the periods where applicable.

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