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Cullen/Frost Q1 Earnings Beat on Higher Y/Y NII & Fee Income Growth
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Cullen/Frost Bankers, Inc. (CFR - Free Report) reported first-quarter 2026 earnings per share of $2.65, beating the Zacks Consensus Estimate of $2.46. The bottom line also rose from $2.30 in the prior-year quarter.
Results benefited from higher net interest income (NII) and non-interest income, supported by growth in loan balances. However, elevated non-interest expenses remained a headwind.
Net income available to its common shareholders was $169.3 million, up 13.4% from $149.3 million in the first quarter of 2025.
CFR’s Revenues & Expenses Increase
Total revenues were $597.1 million, topping the Zacks Consensus Estimate by 0.9%. The metric also improved from the year-ago revenues of $560.4 million.
NII on a taxable-equivalent basis rose 5.6% year over year to $460.8 million. The net interest margin (NIM) expanded 14 basis points year over year to 3.74%. Our estimates for NII and NIM were $459.3 million and 3.7%, respectively.
Non-interest income increased 9.9% year over year to $136.3 million. The rise was driven by higher trust and investment management fees, service charges on deposit accounts, and other non-interest income. Our estimate for non-interest income was $126.9 million.
Non-interest expenses totaled $365.7 million, up 5.1% year over year. The increase was largely attributable to higher salaries and wages, employee benefits, technology, furniture and equipment expenses, and other non-interest expenses. Our estimate for non-interest expenses was $366.6 million.
CFR’s Loans Rise, Deposit Balance Declines
Total loans for the first quarter of 2026 were $22.4 billion, reflecting a 2.5% increase from the prior quarter. Total deposits were $42.8 billion, down marginally on a sequential basis. Our estimates for total loans and total deposits were $22 billion and $44.4 billion, respectively.
Cullen/Frost’s Credit Quality Improves
For the first quarter of 2026, the company recorded credit loss expenses of $6.7 million compared with $13.1 million in the prior-year quarter.
Net charge-offs were $5.7 million, down from $9.7 million a year ago.
The allowance for credit losses on loans, as a percentage of total loans, was 1.28% as of March 31, 2026, compared with 1.32% at the end of the prior-year quarter. Non-accrual loans were $72.4 million, lower than $83.5 million at the end of the first quarter of 2025.
CFR’s Capital Ratios & Profitability Ratios
As of March 31, 2026, the common equity Tier 1 risk-based capital ratio was 14.07%, up from 13.84% at the end of the year-ago quarter. The Tier 1 risk-based capital ratio increased to 14.51% from 14.30%, while the total risk-based capital ratio rose to 15.89% from 15.76%.
The leverage ratio improved to 9.13% from 8.84% a year ago.
Return on average assets was 1.32% compared with 1.19% in the prior-year quarter, while return on average common equity was 15.15% versus 15.54% a year earlier.
CFR Dividend & Share Repurchase Update
The company declared a second-quarter cash dividend of $1.03 per common share, payable June 15, 2026, to shareholders of record as of May 29, 2026. This represented a 3% increase from the previous quarterly dividend of $1 per share.
In the first quarter, Cullen/Frost repurchased 507,753 shares for $70 million. As of March 31, 2026, the company had $230 million remaining under its current $300-million repurchase authorization, which expires in January 2027.
Our Viewpoint on Cullen/Frost
CFR continues to benefit from steady growth in NII, improving margins and solid loan growth. The company’s ongoing organic expansion across Texas markets remains encouraging. However, elevated expense levels could weigh on near-term profitability.
Cullen/Frost Bankers, Inc. Price, Consensus and EPS Surprise
Popular, Inc. (BPOP - Free Report) reported first-quarter 2026 earnings per share of $3.78, which surpassed the Zacks Consensus Estimate of $3.30. The bottom line compared favorably with $2.56 in the year-ago quarter.
BPOP’s results benefited primarily from a rise in NII, fee income and deposit balances. A decline in operating expenses was also encouraging in the quarter. However, lower loan balances and higher provisions were headwinds.
Hancock Whitney Corp.’s (HWC - Free Report) first-quarter 2026 adjusted earnings per share of $1.52 beat the Zacks Consensus Estimate of $1.48. Further, the bottom line rose 10.1% from the prior-year quarter.
HWC’s results were supported by higher NII and modest loan growth. However, the quarter was significantly impacted by a securities portfolio restructuring loss. Deposits also declined modestly. Additionally, higher expenses and increased provisions acted as headwinds.
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Cullen/Frost Q1 Earnings Beat on Higher Y/Y NII & Fee Income Growth
Cullen/Frost Bankers, Inc. (CFR - Free Report) reported first-quarter 2026 earnings per share of $2.65, beating the Zacks Consensus Estimate of $2.46. The bottom line also rose from $2.30 in the prior-year quarter.
Results benefited from higher net interest income (NII) and non-interest income, supported by growth in loan balances. However, elevated non-interest expenses remained a headwind.
Net income available to its common shareholders was $169.3 million, up 13.4% from $149.3 million in the first quarter of 2025.
CFR’s Revenues & Expenses Increase
Total revenues were $597.1 million, topping the Zacks Consensus Estimate by 0.9%. The metric also improved from the year-ago revenues of $560.4 million.
NII on a taxable-equivalent basis rose 5.6% year over year to $460.8 million. The net interest margin (NIM) expanded 14 basis points year over year to 3.74%. Our estimates for NII and NIM were $459.3 million and 3.7%, respectively.
Non-interest income increased 9.9% year over year to $136.3 million. The rise was driven by higher trust and investment management fees, service charges on deposit accounts, and other non-interest income. Our estimate for non-interest income was $126.9 million.
Non-interest expenses totaled $365.7 million, up 5.1% year over year. The increase was largely attributable to higher salaries and wages, employee benefits, technology, furniture and equipment expenses, and other non-interest expenses. Our estimate for non-interest expenses was $366.6 million.
CFR’s Loans Rise, Deposit Balance Declines
Total loans for the first quarter of 2026 were $22.4 billion, reflecting a 2.5% increase from the prior quarter. Total deposits were $42.8 billion, down marginally on a sequential basis. Our estimates for total loans and total deposits were $22 billion and $44.4 billion, respectively.
Cullen/Frost’s Credit Quality Improves
For the first quarter of 2026, the company recorded credit loss expenses of $6.7 million compared with $13.1 million in the prior-year quarter.
Net charge-offs were $5.7 million, down from $9.7 million a year ago.
The allowance for credit losses on loans, as a percentage of total loans, was 1.28% as of March 31, 2026, compared with 1.32% at the end of the prior-year quarter. Non-accrual loans were $72.4 million, lower than $83.5 million at the end of the first quarter of 2025.
CFR’s Capital Ratios & Profitability Ratios
As of March 31, 2026, the common equity Tier 1 risk-based capital ratio was 14.07%, up from 13.84% at the end of the year-ago quarter. The Tier 1 risk-based capital ratio increased to 14.51% from 14.30%, while the total risk-based capital ratio rose to 15.89% from 15.76%.
The leverage ratio improved to 9.13% from 8.84% a year ago.
Return on average assets was 1.32% compared with 1.19% in the prior-year quarter, while return on average common equity was 15.15% versus 15.54% a year earlier.
CFR Dividend & Share Repurchase Update
The company declared a second-quarter cash dividend of $1.03 per common share, payable June 15, 2026, to shareholders of record as of May 29, 2026. This represented a 3% increase from the previous quarterly dividend of $1 per share.
In the first quarter, Cullen/Frost repurchased 507,753 shares for $70 million. As of March 31, 2026, the company had $230 million remaining under its current $300-million repurchase authorization, which expires in January 2027.
Our Viewpoint on Cullen/Frost
CFR continues to benefit from steady growth in NII, improving margins and solid loan growth. The company’s ongoing organic expansion across Texas markets remains encouraging. However, elevated expense levels could weigh on near-term profitability.
Cullen/Frost Bankers, Inc. Price, Consensus and EPS Surprise
Cullen/Frost Bankers, Inc. price-consensus-eps-surprise-chart | Cullen/Frost Bankers, Inc. Quote
Currently, CFR carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Banks
Popular, Inc. (BPOP - Free Report) reported first-quarter 2026 earnings per share of $3.78, which surpassed the Zacks Consensus Estimate of $3.30. The bottom line compared favorably with $2.56 in the year-ago quarter.
BPOP’s results benefited primarily from a rise in NII, fee income and deposit balances. A decline in operating expenses was also encouraging in the quarter. However, lower loan balances and higher provisions were headwinds.
Hancock Whitney Corp.’s (HWC - Free Report) first-quarter 2026 adjusted earnings per share of $1.52 beat the Zacks Consensus Estimate of $1.48. Further, the bottom line rose 10.1% from the prior-year quarter.
HWC’s results were supported by higher NII and modest loan growth. However, the quarter was significantly impacted by a securities portfolio restructuring loss. Deposits also declined modestly. Additionally, higher expenses and increased provisions acted as headwinds.