Prosperity Bancshares Inc (PB) 10-Q Quarterly Report November 2020

PRESS RELEASE	For more information contact:

Prosperity Bancshares, Inc.^®	Cullen Zalman
Prosperity Bank Plaza	Vice President – Banking and Corporate Activities
4295 San Felipe	281.269.7199
Houston, Texas 77027	cullen.zalman@prosperitybankusa.com

FOR IMMEDIATE RELEASE

PROSPERITY BANCSHARES, INC.^®

REPORTS THIRD QUARTER

2020 EARNINGS

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Third quarter earnings per share (diluted) of $1.40, an increase of 17.6% compared to the third quarter 2019

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Third quarter net income of $130.1 million

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Deposits increased $306.5 million or 1.2% (4.7% annualized) during the third quarter 2020

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Allowance for credit losses on loans and off-balance sheet credit exposure was $353.6 million

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Allowance for credit losses to total loans, excluding Warehouse Purchase Program and SBA Paycheck Protection Program loans, of 1.94%⁽¹⁾

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Nonperforming assets remain low at 0.24% of third quarter average interest-earning assets

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Return (annualized) on third quarter average assets of 1.58%

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Returns (annualized) on third quarter average common equity of 8.64% and average tangible common equity of 19.19%⁽¹⁾

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Third quarter efficiency ratio of 40.17%⁽¹⁾

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Increase in dividend of 6.5% to $0.49 for the fourth quarter 2020

HOUSTON, October 28, 2020. Prosperity Bancshares, Inc.

^® (NYSE: PB), the parent company of Prosperity Bank^® (collectively, “Prosperity”), reported net income for the quarter ended September 30, 2020 of $130.1 million compared with $81.8 million for the same period in 2019. Net income per diluted common share was $1.40 compared with $1.19 for the same period in 2019. Additionally, deposits increased $306.5 million or 1.2% (4.7% annualized) during the third quarter 2020 and nonperforming assets remain low at 0.24% of third quarter average interest-earning assets with an annualized return on third quarter average assets of 1.58%. On November 1, 2019, LegacyTexas Financial Group, Inc. (“LegacyTexas”) merged with Prosperity Bancshares and LegacyTexas Bank merged with Prosperity Bank (collectively, the “Merger”).

“We are pleased with our third quarter 2020 results of $1.40 in earnings per share and annualized returns on average tangible equity of 19.19% and on average assets of 1.58%. Because of these metrics, our strong capital position and confidence in our business, Prosperity Bancshares’ Board has approved a 6.5% increase in the fourth quarter dividend to $0.49 per share,” said David Zalman, Prosperity’s Senior Chairman and Chief Executive Officer.

“Our asset quality remains sound, with nonperforming assets at $69.5 million or 0.24% of average interest earning assets for the third quarter, a decrease of $8.4 million compared with the second quarter 2020. Loans on forbearance decreased from 17.2% of total loans as of June 30, 2020 to 1.1% as of October 26, 2020. Our allowance for credit losses as a percent of total loans is higher than at any time in my banking career and equates to a coverage ratio of 5.6 times our nonperforming loans,” continued Zalman.

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(1)	Refer to the “Notes to Selected Financial Data” at the end of this Earnings Release for a reconciliation of this non-GAAP financial measure to the nearest GAAP financial measure.

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The following information was filed by Prosperity Bancshares Inc (PB) on Wednesday, October 28, 2020 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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Inside Prosperity Bancshares Inc's 10-Q Quarterly Report:

Financial - Dividend Highlight
The increase was primarily due to the increase in deposits of $2.26 billion, increase in net proceeds and purchases of maturity securities and net cash provided by operating activities of $496.9 million, partially offset by the repurchase of common stock of $115.0 million, the payment of cash dividends of $128.5 million, net repayments of other short-term borrowing of $1.30 billion and $706.5 million used in investing activities.

Financial - Shares Highlight
Share Repurchases On January 29, 2020, Bancshares announced a stock repurchase program that authorized the repurchase of up to 5%, or approximately 4.74 million shares, of the Bancshares' outstanding common stock over a one-year period expiring on January 28, 2021, at the discretion of management.
Other - Other Highlight
A change in the allowance for credit losses can be attributable to several factors, most notably (1) specific reserves identified for impaired loans, (2) historical lifetime credit loss information, (3) changes in environmental factors and (4) growth in the balance of loans.
Other - Other Highlight
The Company's allowance for credit losses consists of two elements: (1) specific valuation allowances based on probable losses on impaired loans; and (2) a general valuation allowance based on historical lifetime loan loss experience, general economic conditions and other qualitative risk factors both internal and external to the Company.
Other - Other Highlight
The Company's allowance for credit losses on loans consists of two components: (1) a specific valuation allowance based on probable losses on specifically identified loans and (2) a general valuation allowance based on historical lifetime loan loss experience, general economic conditions and other qualitative risk factors both internal and external to the Company.
Other - Other
Nevertheless, the Company could sustain...Read more
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Financial - Earnings
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Financial Statements, Disclosures and Schedules

Inside this 10-Q Quarterly Report

Material Contracts, Statements, Certifications & more

Prosperity Bancshares Inc provided additional information to their SEC Filing as exhibits

Exhibit 31.1: Rule 13A-14(A)/15D-14(A) Certification

Exhibit 31.2: Rule 13A-14(A)/15D-14(A) Certification

Exhibit 32.1: Section 1350 Certification

Exhibit 32.2: Section 1350 Certification

Ticker: PB
CIK: 1068851
Form Type: 10-Q Quarterly Report
Accession Number: 0001564590-20-051291
Submitted to the SEC: Thu Nov 05 2020 4:04:37 PM EST
Accepted by the SEC: Thu Nov 05 2020
Period: Wednesday, September 30, 2020
Industry: State Commercial Banks