- South Plains Financial (SPFI, Financial) reported a Q1 2025 net income of $12.3 million, a 13% increase year-over-year but a 25.5% decrease from the previous quarter.
- Net interest margin improved to 3.81%, with total deposits growing by 4.7% to $3.79 billion.
- The company repurchased 250,000 shares for $8.3 million in Q1 2025, with $7 million remaining under the share repurchase program.
South Plains Financial, Inc. (SPFI) reported its Q1 2025 financial results with a net income of $12.3 million, or $0.72 per diluted share. This marks a 13% increase from the $10.9 million reported in Q1 2024 but a significant decline of 25.5% from $16.5 million in Q4 2024. The decrease is primarily attributed to seasonal factors impacting earnings.
The company's net interest margin rose to 3.81%, an improvement from 3.75% in the previous quarter and 3.56% in the same quarter last year. A reduction in the average cost of deposits to 219 basis points from 229 basis points in the preceding quarter supported this margin expansion.
Asset quality saw substantial improvement, with the ratio of nonperforming assets to total assets decreasing significantly to 0.16% from 0.58% at the end of 2024. The improvement was facilitated by sustained payment performances, including a $19 million credit returning to accrual status, which was later repaid in full.
Total deposits reached $3.79 billion, reflecting a 4.7% quarterly growth driven by a $70.2 million seasonal increase in public funds alongside organic growth in retail and commercial deposits. Loans held for investment increased to $3.08 billion, representing a moderate growth rate of 2.7% annualized.
During Q1 2025, South Plains actively engaged in share repurchases, buying back 250,000 shares for a total of $8.3 million, with $7 million still available under the current program. This move indicates management's confidence in the intrinsic value and future prospects of the bank.
Noninterest income fell to $10.6 million, down from $13.3 million in Q4 2024, primarily due to decreased mortgage banking revenues. Noninterest expenses rose to $33.0 million, largely because of annual salary adjustments and higher health insurance costs, typical for the first quarter.
Overall, South Plains Financial continues to demonstrate strong financial health with robust deposit gathering capabilities and improved credit quality, positioning itself well amidst current economic uncertainties.
