Prosperity Bancshares : First Quarter 2026 Investor Presentation (IP 1Q26 DRAFT v.F 1)

Published: 2026-04-29 07:28:24 ET PB

Published on 04/29/2026 at 07:28 am EDT - Modified on 04/29/2026 at 07:29 am EDT

Additional Information about the Transaction and Where to Find It

In connection with the proposed transaction, Prosperity has filed with the SEC a registration statement (the "Registration Statement") on Form S-4 (File No. 333-294882) to register the shares of Prosperity common stock to be issued to the shareholders of Stellar in connection with the proposed transaction. The Registration Statement includes a prospectus of Prosperity and a proxy statement of Stellar (the "proxy statement/prospectus"), which has been sent to the shareholders of Stellar in connection with the proposed transaction. The Registration Statement was declared effective on April 21, 2026, at which time Prosperity filed a final prospectus and Stellar filed a definitive proxy statement. The mailing of the proxy statement/prospectus to Stellar shareholders commenced on April 23, 2026. This communication is not a substitute for the Registration Statement, the proxy statement/prospectus or any other document that may be filed by Prosperity or Stellar with the SEC. INVESTORS AND SECURITY HOLDERS ARE URGED TO READ THE REGISTRATION STATEMENT, THE PROXY STATEMENT/PROSPECTUS INCLUDED WITHIN THE REGISTRATION STATEMENT AND ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SEC IN CONNECTION WITH THE PROPOSED TRANSACTION OR INCORPORATED BY REFERENCE INTO THE PROXY/STATEMENT PROSPECTUS, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THESE DOCUMENTS, CAREFULLY AND IN THEIR ENTIRETY, BECAUSE THEY CONTAIN OR WILL CONTAIN IMPORTANT

INFORMATION. Investors and security holders may obtain the Registration Statement and the proxy statement/prospectus and other documents that are filed with the SEC by Prosperity or Stellar, as applicable, free of charge from the SEC's website at https://www.sec.gov or through the investor relations section of Prosperity's website at https://www.prosperitybankusa.com/investor-relations/ or Stellar's website at https://ir.stellar.bank.

Participants in the Solicitation

Prosperity, Stellar and certain of their directors and executive officers and other employees may be deemed to be participants in the solicitation of proxies from Stellar's shareholders in connection with the proposed transaction. Information about the directors and executive officers of Prosperity and their ownership of Prosperity common stock is contained in the definitive proxy statement for Prosperity's 2026 annual meeting of shareholders (the "Prosperity Annual Meeting Proxy Statement"), which was filed with the SEC on March 16, 2026, including under the headings "Item 1. Election of Directors," "Corporate Governance," "Executive Compensation and Other Matters," "Item 3. Advisory Vote on Executive Compensation," and "Beneficial Ownership of Common Stock by Management of the Company and Principal Shareholders." Information about the directors and executive officers of Stellar and their ownership of Stellar common stock is contained in Amendment No. 1 to the Annual Report on Form 10-K for the year ended December 31, 2025 of Stellar (the "Stellar 10-K/A"), which was filed with the SEC on April 17, 2026. Additional information regarding the persons who may, under the rules of the SEC, be deemed participants in the solicitation of the shareholders of Stellar in connection with the proposed transaction, including a description of their direct or indirect interests, by security holdings or otherwise, is included in the proxy statement/prospectus relating to the proposed transaction filed with the SEC. To the extent holdings of securities by potential participants (or the identity of such participants) have changed since the information printed in the Prosperity Annual Meeting Proxy Statement or the Stellar 10-K/A, such information has been or will be reflected on Statements of Change in Ownership on Forms 3 and 4 filed with the SEC, as applicable. Free copies of the proxy statement/prospectus relating to the proposed transaction and free copies of the other SEC filings to which reference is made in this paragraph may be obtained from the SEC's website at https://www.sec.gov or through the investor relations section of Prosperity's website at https://www.prosperitybankusa.com/investor-relations/ or Stellar's website at https://ir.stellar.bank.

No Offer or Solicitation

This communication is for informational purposes only and is not intended to and does not constitute an offer to subscribe for, buy or sell, or the solicitation of an offer to subscribe for, buy or sell, or an invitation to subscribe for, buy or sell any securities or a solicitation of any vote or approval in any jurisdiction, nor shall there be any sale, issuance or transfer of securities in any jurisdiction in which such offer, invitation, sale or solicitation would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offer of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act, and otherwise in accordance with applicable law.

Net income of $116.3 million, or $149.9 excluding merger related expenses, representing an increase of 15.1% compared to the first quarter 2025

Earnings per share (diluted) of $1.16, or $1.50 excluding merger related expenses, representing an increase of 9.5% compared to the first quarter 2025

Assets of $43.6 billion, total loans of $25.3 billion, and deposits of $32.6 billion at March 31, 2026

Common equity tier 1 ratio of 15.44% and leverage ratio of 11.22% at March 31, 2026

Net interest margin increased 21 basis points to 3.51% compared to 3.30% for the fourth quarter 2025

Return (annualized) on first quarter average assets of 1.42%, and average tangible common equity of 13.65% in the first quarter 2026, excluding merger related expenses

Allowance for credit losses on loans and off-balance sheet credit exposures of $421.5 million and allowance for credit losses on loans to total loans, excluding Warehouse Purchase Program, of 1.61%

Declared cash dividend of $0.60 for the second quarter 2026

Repurchased approximately 837,000 shares of common stock in the first quarter 2026

Completed the merger of American Bank Holding Corporation on January 1, 2026

Completed the merger of Southwest Bancshares, Inc. on February 1, 2026

Announced the signing of definitive merger agreement with Stellar Bancorp, Inc. on January 28, 2026, and have received all necessary regulatory approvals

Source: Company Documents

A Texas-based financial holding company with $43.6 billion in total assets

Prosperity has been ranked as one of Forbes America's Best Banks since the list's inception in 2010, and was ranked in the Top 10 for 14 consecutive years

Recognized by Newsweek as one of America's Best Regional Banks in 2026

Ranked #2 in deposit market share in Texas (1)

Texas and Oklahoma continue to benefit from strong economies, and are home to 57 Fortune 500 headquartered companies

Shareholder driven with 4.2% fully diluted insider ownership (2)

Successful completion of 47 acquisitions (whole bank, branch and failed bank transactions)

312 Full-Service Locations (3)

15 in Bryan/College Station Area

6 in Central Oklahoma Area

47 in Central Texas Area

61 in Dallas/Fort Worth Area

22 in East Texas Area

62 in Houston Area

46 in South Texas Area

8 in Tulsa Area

45 in West Texas Area

(1) Per FDIC; Includes Texas headquartered commercial banks; Shown pro-forma for the recently completed acquisitions of American Bank Holding Company and Southwest Bancshares, Inc.; Deposits as of 6/30/2025

5 (2) Per proxy statement (Form DEF 14A) filed on 3/13/2025

(3) Includes 18 locations currently doing business as American Bank and 11 locations doing business as Texas Partners Bank

Data as of 12/31/2025

Loans $21.8 Bn

Deposits $28.5 Bn

Assets $38.5 Bn

10 Year CAGR (1)

Loans 8.7%

Deposits 4.9%

Assets 5.7%

Assets

Deposits

Total Loans

Equity

6 Source: Company Documents

Represents the Compound Annual Growth Rate from 12/31/2015 - 12/31/2025

Note: Net income includes the following ($ in thousands)

Provision

for Credit Losses

$7,560

$24,000

$14,325

$16,350

$4,300

$20,000

$18,540

$9,066

Loan

Discount Accretion

$52,122

$38,970

$21,906

$13,909

$28,045

$91,341

$39,278

$7,401

$5,566

$17,490

$12,402

$3,131

$3,748

Net Income Net Income (Excluding Purchase Accounting Adjustments)

(1)

Net Income (Excluding Non-Recurring Charges) Net Income (Excluding PAA and Non-Recurring Charges)

Source: Company Documents

7 (1) Excludes after-tax merger related provision and expenses related to recent acquisitions, gain on Visa Class B-1 stock exchange net of investment securities sales in 2024 and FDIC special

assessments

Note: Net income includes the following ($ in thousands)

Provision

for Credit Losses

$7,560

$24,000

$14,325

$16,350

$4,300

$20,000

$18,540

$9,066

Loan

Discount Accretion

$52,122

$38,970

$21,906

$13,909

$28,045

$91,341

$39,278

$7,401

$5,566

$17,490

$12,402

$3,131

$3,748

EPS Core EPS (Excluding Purchase Accounting Adjustments)

(1)

EPS (Excluding Non-Recurring Charges)

Core EPS (Excluding PAA and Non-Recurring Charges)

(1)

Source: Company Documents

8 (1) Excludes after-tax merger related provision and expenses related to recent acquisitions, gain on Visa Class B-1 stock exchange net of investment securities sales in 2024 and FDIC special assessments

Net Interest Margin (Tax Equivalent)

Net Interest Margin (Excluding Purchase Accounting Adjustments)

9 Source: Company Documents

($'s in millions)

% of Assets

Acquired 0.0% 2.5% 0.0% 0.0% 31.3% 0.0% 0.0% 0.0% 5.5% 3.5% 0.0% 0.0% 11.5%

Total Assets Excluding Acquisitions

Source: Company Documents

Representative of target assets at closing

Calculated by dividing total noninterest expense, excluding credit loss provisions, by net interest income plus noninterest income, excluding net gains and losses on the sale or write down of assets and securities. Additionally, taxes are not part of this calculation.

10 (3) Excludes after-tax merger related provision and expenses related to recent acquisitions, gain on Visa Class B-1 stock exchange net of investment securities sales in 2024 and FDIC special assessments

(1) (1)

Interim periods shown on an annualized basis

ROATCE

ROATCE (Excluding Non-Recurring Charges)(2)

Excludes after-tax merger related provision and expenses related to recent acquisitions, gain on Visa Class B-1 stock exchange net of investment securities sales in 2024 and FDIC special assessments

(1) (1)

ROAA ROAA (Excluding Non-Recurring Charges)(2)

Interim periods shown on an annualized basis

Excludes after-tax merger related provision and expenses related to recent acquisitions, gain on Visa Class B-1 stock exchange net of investment securities sales in 2024 and FDIC special assessments

As of March 31, 2026 ($ in millions)

$mm

Cost (%)(1)

Noninterest-Bearing Demand

$10,581

0.00%

Interest-Bearing Demand

$6,346

0.91%

Money Market & Savings

$10,907

1.94%

CDs & Other Time

$4,799

3.32%

Total Deposits: $32.6Bn

Total Cost of Deposits: 1.32% (1)

Cost of Interest-Bearing Deposits: 1.95% (1)

Source: Company Documents

Data for the three months ended March 31, 2026

14 Source: Company Documents

As of March 31, 2026 ($ in millions)

Loan Portfolio by Category & Geography Loans by Rate Structure

Fixed

38.2%

Floating

27.9%

~4.0yr

Avg. Life

Variable Rate

33.9%

Loans By Area

Amount(2)(4)

% of Total

Bryan / College Station

$1,001

4.2%

Central Oklahoma

$544

2.3%

Central Texas

$5,164

21.7%

Dallas / Ft. Worth

$6,179

26.0%

East Texas

$724

3.0%

Houston

$4,682

19.7%

South Texas

$2,443

10.3%

Tulsa

$515

2.2%

West Texas

$2,497

10.5%

(1)

Source: Company Documents

Data for the three months ended March 31, 2026

Excludes $106 million in loans assigned to the Corporate Group

Core yield excludes purchase accounting adjustments

Excludes Warehouse Purchase Program (WPP) loans

Yield on Total Loans: 5.94%

Yield on Loans HFI (Excl. WPP): 5.95% (1)

Core Yield on Loans HFI (Excl. WPP): 5.76% (1)(3)

As of March 31, 2026 ($ in millions)

Portfolio Commentary

Commercial Real Estate Detail

($ in millions)

•

Loan portfolio is diversified across the Bank's market

areas and by underlying collateral type

Other

$1,820

26%

Industrial

$1,402

20%

•

CRE and construction loans conservatively

Retail

$1,333

19%

$7,126mm

Office

$954

13%

Total

Multifamily (MF)

$576

Hotels

$539

Medical

$502

34% of commercial real estate is owner occupied

underwritten to cost of collateral

C&I Detail (Excluding Energy Loans)

Note: Average CRE loan balance outstanding equal to $1.1 million

Construction Detail

F R

67 28%

13 19%

11 15%

91 14%

53 6%

26 5%

01 15%

($ in millions)

Lots & Land Dev.

$719

22%

.E. & Const.

Multifamily (MF)

$692

21%

inancial Services

Single Family (SF)

$690

21%

Manuf. / Indust.

Other

$575

18%

etail Medical

$3,253mm

Total(2)

Raw Land Retail

$277

$155

ransportation

Office

$74

Other (1)

Medical

$60

Hotels

$11

$2,759mm Total

Source: Company Documents

16 (1) Includes State & Political loans

Total includes a net unaccreted discount of $0.09 million not shown in graph

($ in millions)

$371.4 million

Total Allowance for Credit Losses and Unfunded Commitments

$421.5 million

1.63% ACL to Total Loans (1)

1.61% ACL to Total Loans (1)

 Net increased

reserve related to

Allowance for

Allowance for Credit Losses

Allowance for Unfunded Commitments (Other Liabilities)

Net charge-offs

Increase in allowance for PCD loans related to recent acquisition of $52.1 million (goodwill)

($5.4) million released related to resolved PCD loans without any charge offs during the first quarter

Increase in

allowance for Non-PCD loans related recent acquisition of

$39.3 million (goodwill)

changes in macro-

economic conditions, qualitative economic outlook, outstanding balances and historical loss rates

Credit Losses

Allowance for Unfunded Commitments (Other Liabilities)

(1) Excludes Warehouse Purchase Program (WPP) loans

NPAs / Loans + OREO

Source: Company Documents & Uniform Bank Performance Report Note: NPAs include loans past due 90 days and still accruing

(1) UBPR = Uniform Bank Performance Report; Peer Group 2 (113 banks) - Insured commercial banks having assets between $10 billion and $100 billion

Net Charge-Offs / Average Loans

(2)

Net Charge-Offs

($ in millions)

Net PCD Recoveries

Non-Acquired Loan Charge-Offs Acquired Loan Charge-Offs Pre-CECL Acquired Loan Charge-Offs Post-CECL

(3)

Source: Company Documents & Uniform Bank Performance Report Note: NPAs include loans past due 90 days and still accruing

Net PCD Recoveries Post-CECL

UBPR = Uniform Bank Performance Report; Peer Group 2 (113 banks) - Insured commercial banks having assets between $10 billion and $100 billion

Interim period net charge-off ratios shown on an annualized basis

Reflects all charge-offs and recoveries on acquired loans in accordance with CECL accounting practices; Prior to the adoption of CECL in the first quarter of 2020, PCD loans were classified as

Purchased Credit Impaired (PCI) loans and their assigned fair-value marks were netted against the outstanding loan balance with a charge-off only being recorded when the loss exceeded

the amount of fair-value marks remaining.

As of March 31, 2026 ($ in millions)

Mortgage-Backed Securities

$mm

$11,199

Collateralized Mortgage Obligations

$605

States & Political Subdivisions

$122

Other Securities

$23

U.S. Government Agency Securities

97.0% Held to Maturity 3.0% Available for Sale

Yield on Securities: 2.49% (1)

Duration: 3.75 (2)

Avg. Yearly Cash Flow: ~$2.1Bn

Source: Company Documents

(1) Data for the three months ended March 31, 2026

(2) Modified duration shown; Weighted average life equal to 4.4 years

Disclaimer

Prosperity Bancshares Inc. published this content on April 29, 2026, and is solely responsible for the information contained herein. Distributed via Public Technologies (PUBT), unedited and unaltered, on April 29, 2026 at 11:27 UTC.