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Hilltop Holdings Inc.’s (HTH - Free Report) first-quarter 2026 earnings of 64 cents per share surpassed the Zacks Consensus Estimate of 50 cents. The bottom line declined 1.5% from the prior-year quarter.
Results primarily benefited from higher net interest income (NII), lower provision for credit losses and a decline in non-interest expenses. Sequential growth in loans was another positive. However, lower non-interest income and a decline in deposits were headwinds.
Net income attributable to common stockholders was $37.8 million, down 10.2% year over year. Our estimate for the metric was $25.6 million.
Hilltop Holdings’ Revenues Decline, Expenses Fall
Net revenues in the first quarter were $300.5 million, down 5.6% year over year. The top line lagged the Zacks Consensus Estimate of $308.9 million.
NII increased 6.6% year over year to $112.1 million. The net interest margin (NIM) (taxable-equivalent basis) was 3.15%, expanding 29 basis points (bps). Our estimates for NII and NIM were $108.7 million and 2.98%, respectively.
Non-interest income was $188.4 million, down 11.7%. The decline was due to a fall in other non-interest income. We had projected the metric to be $201.8 million.
Non-interest expenses fell 1.3% from the prior-year quarter to $248.3 million. The decrease was mainly due to lower other expenses and employees' compensation and benefits costs, partly offset by higher professional services expenses. We projected total non-interest expenses of $270.2 million.
As of March 31, 2026, net loans held for investment were $8.3 billion, up 1.5% sequentially. Total deposits were $10.5 billion, down 3.2%. Our estimates for net loans held for investment and total deposits were $8.2 billion and $11 billion, respectively.
Hilltop Holdings’ Credit Quality Improving
In the first quarter, Hilltop Holdings recorded a provision for credit losses of $1.8 million, down 81.1% from the prior-year quarter. Our estimate for the metric was $5.2 million.
As of March 31, 2026, non-performing assets, as a percentage of total assets, were 0.44%, which decreased 12 bps from the year-ago quarter. Non-accrual loans were $61 million, or 0.66% of total loans, down from $81.5 million, or 0.93%, as of March 31, 2025.
HTH’s Profitability & Capital Ratios Decline
Return on average assets at the end of the reported quarter was 1.02%, down from the prior-year quarter’s 1.13%. The return on average stockholders’ equity was 7.12%, which decreased from 7.82%.
The common equity tier 1 capital ratio was 19.08% as of March 31, 2026, down from 21.17% in the corresponding period of 2025. The total capital ratio was 21.50%, down from the year-ago period’s 24.45%.
HTH’s Share Repurchase Update
In the reported quarter, the company repurchased 1.24 million shares for $47.5 million.
Our Viewpoint on Hilltop Holdings
HTH’s higher NII, loan growth, lower provisions and reduced expenses are likely to support its financials. However, lower non-interest income, deposit decline and pressure on profitability metrics remain concerns.
Hilltop Holdings Inc. Price, Consensus and EPS Surprise
Bank OZK (OZK - Free Report) reported first-quarter 2026 adjusted earnings per share of $1.44, which missed the Zacks Consensus Estimate of $1.46. Also, the bottom line declined 2% year over year.
Results were primarily hurt by higher provisions for credit losses and a rise in operating expenses. A decline in non-interest income also acted as a headwind. Nevertheless, solid NII growth and healthy loans and deposits balances provided support to Bank OZK’s performance.
East West Bancorp, Inc.’s (EWBC - Free Report) first-quarter 2026 earnings per share of $2.57 beat the Zacks Consensus Estimate of $2.46. Moreover, the bottom line increased 22.9% from the prior-year quarter’s level.
The results were primarily aided by an increase in NII and non-interest income alongside lower provisions. Also, loan and deposit balances increased sequentially in the quarter. However, higher non-interest expenses acted as a spoilsport for East West Bancorp.
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Hilltop Holdings' Q1 Earnings Beat as NII Rise, Provisions Plunge
Key Takeaways
Hilltop Holdings Inc.’s (HTH - Free Report) first-quarter 2026 earnings of 64 cents per share surpassed the Zacks Consensus Estimate of 50 cents. The bottom line declined 1.5% from the prior-year quarter.
Results primarily benefited from higher net interest income (NII), lower provision for credit losses and a decline in non-interest expenses. Sequential growth in loans was another positive. However, lower non-interest income and a decline in deposits were headwinds.
Net income attributable to common stockholders was $37.8 million, down 10.2% year over year. Our estimate for the metric was $25.6 million.
Hilltop Holdings’ Revenues Decline, Expenses Fall
Net revenues in the first quarter were $300.5 million, down 5.6% year over year. The top line lagged the Zacks Consensus Estimate of $308.9 million.
NII increased 6.6% year over year to $112.1 million. The net interest margin (NIM) (taxable-equivalent basis) was 3.15%, expanding 29 basis points (bps). Our estimates for NII and NIM were $108.7 million and 2.98%, respectively.
Non-interest income was $188.4 million, down 11.7%. The decline was due to a fall in other non-interest income. We had projected the metric to be $201.8 million.
Non-interest expenses fell 1.3% from the prior-year quarter to $248.3 million. The decrease was mainly due to lower other expenses and employees' compensation and benefits costs, partly offset by higher professional services expenses. We projected total non-interest expenses of $270.2 million.
As of March 31, 2026, net loans held for investment were $8.3 billion, up 1.5% sequentially. Total deposits were $10.5 billion, down 3.2%. Our estimates for net loans held for investment and total deposits were $8.2 billion and $11 billion, respectively.
Hilltop Holdings’ Credit Quality Improving
In the first quarter, Hilltop Holdings recorded a provision for credit losses of $1.8 million, down 81.1% from the prior-year quarter. Our estimate for the metric was $5.2 million.
As of March 31, 2026, non-performing assets, as a percentage of total assets, were 0.44%, which decreased 12 bps from the year-ago quarter. Non-accrual loans were $61 million, or 0.66% of total loans, down from $81.5 million, or 0.93%, as of March 31, 2025.
HTH’s Profitability & Capital Ratios Decline
Return on average assets at the end of the reported quarter was 1.02%, down from the prior-year quarter’s 1.13%. The return on average stockholders’ equity was 7.12%, which decreased from 7.82%.
The common equity tier 1 capital ratio was 19.08% as of March 31, 2026, down from 21.17% in the corresponding period of 2025. The total capital ratio was 21.50%, down from the year-ago period’s 24.45%.
HTH’s Share Repurchase Update
In the reported quarter, the company repurchased 1.24 million shares for $47.5 million.
Our Viewpoint on Hilltop Holdings
HTH’s higher NII, loan growth, lower provisions and reduced expenses are likely to support its financials. However, lower non-interest income, deposit decline and pressure on profitability metrics remain concerns.
Hilltop Holdings Inc. Price, Consensus and EPS Surprise
Hilltop Holdings Inc. price-consensus-eps-surprise-chart | Hilltop Holdings Inc. Quote
Hilltop Holdings currently carries a Zacks Rank #5 (Strong Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of HTH’s Peer Banks
Bank OZK (OZK - Free Report) reported first-quarter 2026 adjusted earnings per share of $1.44, which missed the Zacks Consensus Estimate of $1.46. Also, the bottom line declined 2% year over year.
Results were primarily hurt by higher provisions for credit losses and a rise in operating expenses. A decline in non-interest income also acted as a headwind. Nevertheless, solid NII growth and healthy loans and deposits balances provided support to Bank OZK’s performance.
East West Bancorp, Inc.’s (EWBC - Free Report) first-quarter 2026 earnings per share of $2.57 beat the Zacks Consensus Estimate of $2.46. Moreover, the bottom line increased 22.9% from the prior-year quarter’s level.
The results were primarily aided by an increase in NII and non-interest income alongside lower provisions. Also, loan and deposit balances increased sequentially in the quarter. However, higher non-interest expenses acted as a spoilsport for East West Bancorp.