Prosperity Bancshares, Inc.® Reports Strong Second Quarter Earnings

HOUSTON, July 27, 2012 /PRNewswire/ -- Prosperity Bancshares, Inc.® (NYSE: PB), the parent company of Prosperity Bank®, reported net income for the quarter ended June 30, 2012 of $36.972 million or $0.78 per diluted common share, an increase in net income of $1.880 million or 5.4%, compared with $35.092 million or $0.75 per diluted common share for the same period in 2011.

"I am very pleased to be able to announce our outstanding results for the second quarter of 2012, particularly during the current economic environment when our industry is so challenged," commented David Zalman, Chairman and Chief Executive Officer.  "I am proud of our team of bankers and their ability to attract quality customers to our bank.  In fact, over the past three months, our lenders produced more loans than we have ever produced during a calendar quarter in the history of our bank."

"During the past quarter, we completed our merger with Billy and Cathy Allen's team at The Bank Arlington.  This additional location in the Dallas/Fort Worth CMSA will allow us to continue our growth in that market.  On July 1, we completed our merger with American State Financial Corporation.  W.R. Collier and his team provide us with an excellent platform for future growth in West Texas.  We now have major operations in Lubbock, Midland/Odessa and Abilene and believe the American State Bank leadership team, including Mike Epps, Tony Whitehead, Mike Marshall and Gary Galbraith, brings vast knowledge of these markets to our team. Finally, we are excited about our recently announced, and fifth in the past year, merger agreement with Community National Bank in Bellaire, Texas, located in the heart of the Houston MSA.  Randy Dobbs and John James along with their team will help us continue our growth in Houston," continued Zalman.

"While we are excited about our recent mergers, our team remains focused on growing our bank by providing the highest level of service to our customers.  We remain excited about our future and strive to continue building shareholder value," concluded Zalman.

Prosperity's management uses certain non−GAAP (generally accepted accounting principles) financial measures to evaluate its performance. Specifically, Prosperity reviews tangible book value per share, return on average tangible common equity and the tangible equity to tangible assets ratio. Prosperity has included in this Earnings Release information relating to these non-GAAP financial measures for the applicable periods presented.  Please refer to the "Notes to Selected Financial Data" at the end of this Earnings Release for a reconciliation of these non-GAAP financial measures.

Results of operations for the three months ended June 30, 2012

For the three months ended June 30, 2012, net income was $36.972 million compared with $35.092 million for the same period in 2011.  Net income per diluted common share was $0.78 for the three months ended June 30, 2012 and $0.75 for the same period in 2011. Returns on average assets, average common equity and average tangible common equity, each on an annualized basis, for the three months ended June 30, 2012 were 1.35%, 9.06% and 21.70%, respectively.  Prosperity's efficiency ratio (excluding net gains and losses on the sale of securities and assets) was 41.94% for the three months ended June 30, 2012.

Net interest income before provision for credit losses for the quarter ended June 30, 2012 increased 0.04% to $83.666 million compared with $83.630 million during the same period in 2011. The net interest margin on a tax equivalent basis decreased to 3.55% for the three months ended June 30, 2012 compared with 4.06% for the same period in 2011.  On a linked quarter basis, the tax equivalent net interest margin decreased nine basis points to 3.55% for the three months ended June 30, 2012 from 3.64% reported for the three months ended March 31, 2012.

Non-interest income increased $126,000 or 0.9% to $13.656 million for the three months ended June 30, 2012 compared with $13.530 million during the same period in 2011.  The change was due to an increase in debit card and ATM card income and a decrease in loss on sale of securities partially offset by a reduction in NSF fees.

Non-interest expense decreased $1.7 million or 4.1% to $40.788 million for the three months ended June 30, 2012 compared with $42.514 million during the same period in 2011.  The decrease was primarily attributable to a reduction in regulatory assessments and FDIC insurance.

Average loans increased 7.8% or $283.096 million to $3.914 billion for the quarter ended June 30, 2012 compared with $3.631 billion for the same period of 2011.  Linked quarter average loans increased 2.5% or $95.361 million from $3.819 billion at March 31, 2012.

Average deposits increased 8.8% or $683.271 million to $8.436 billion for the quarter ended June 30, 2012 compared with $7.752 billion for the same period of 2011.  Linked quarter average deposits increased 0.09% or $7.160 million from $8.429 billion at March 31, 2012.

Loans at June 30, 2012 were $3.950 billion, an increase of $285.084 million or 7.8%, compared with $3.665 billion at June 30, 2011 and an increase of $184.426 million or 4.9% (9.8% annualized) compared with $3.766 billion at December 31, 2011.     Linked quarter loans increased $75.470 million or 1.9% (7.8% annualized) at June 30, 2012 compared with loans of $3.875 billion at March 31, 2012.  As reflected in the table below, loan growth was impacted by the acquisition of Texas Bankers, Inc. and The Bank Arlington.  Excluding loans acquired in these acquisitions, year to date loan growth increased 7.1% on an annualized basis.

Deposits at June 30, 2012 were $8.395 billion, an increase of $726.890 million or 9.5%, compared with $7.668 billion at June 30, 2011 and an increase of $334.328 million or 4.1% (8.3% annualized) compared with $8.060 billion at December 31, 2011.    Linked quarter deposits decreased $149.869 million or 1.8% at June 30, 2012 compared with deposits of $8.544 billion at March 31, 2012.  As reflected in the table below, deposit growth was impacted by the acquisition of Texas Bankers, Inc. and The Bank Arlington.  Excluding deposits assumed in these acquisitions, year to date deposit growth increased 5.9% on an annualized basis.

The table below provides detail on loans acquired and deposits assumed in the Texas Bankers, Inc. and The Bank Arlington transactions completed on January 1, 2012 and April 1, 2012, respectively:

Balance Sheet Data (at period end)

June 30, 2012

Mar 31, 2012

Dec 31, 2011

June 30, 2011

(In thousands)

(Unaudited)

(Unaudited)

(Unaudited)

(Unaudited)






Loans:





Acquired with Texas Bankers, Inc.

$          28,421

$          27,053

$               --

$                 --

Acquired with The Bank Arlington

22,542

--

--

--

All other

3,899,369

3,847,809

3,765,906

3,665,248

Total Loans

$     3,950,332

$     3,874,862

$   3,765,906

$     3,665,248











Deposits:





Assumed with Texas Bankers, Inc.

$          62,739

$          63,681

$                --

$                 --

Assumed with The Bank Arlington

33,505

--

--

--

All other

8,298,338

8,480,770

8,060,254

7,667,692

Total Deposits

$     8,394,582

$     8,544,451

$   8,060,254

$     7,667,692

At June 30, 2012, Prosperity had $10.737 billion in total assets, $3.950 billion in loans and $8.395 billion in deposits.  Assets, loans and deposits at June 30, 2012 increased 11.2%, 7.8% and 9.5%, respectively, compared with June 30, 2011.

Results of operations for the six months ended June 30, 2012

For the six months ended June 30, 2012, net income was $73.459 million compared with $68.970 million for the same period in 2011.  Net income per diluted common share was $1.55 for the six months ended June 30, 2012 compared with $1.47 for the same period in 2011.  Returns on average assets, average common equity and average tangible common equity, each on an annualized basis, for the six months ended June 30, 2012 were 1.37%, 9.10% and 22.12%, respectively.  Prosperity's efficiency ratio (excluding net gains and losses on the sale of securities and assets) was 42.09% for the six months ended June 30, 2012.

Net interest income before provision for credit losses for the six months ended June 30, 2012 increased $1.469 million or 0.9%, to $165.512 million compared with $164.043 million during the same period in 2011.  The increase was attributable primarily to a 13.0% increase in average earning assets over the same period.

Non-interest income increased $204,000 or 0.7% to $27.601 million for the six months ended June 30, 2012 compared with $27.397 million for the same period in 2011.  The increase was mainly due to an increase in ATM and debit card income and a decrease in net loss on the sale of other real estate and net loss on sale of securities partially offset by a decrease in NSF fees.

Non-interest expense decreased $2.962 million or 3.5% to $81.247 million for the six months ended June 30, 2012 compared with $84.209 million for the same period in 2011.  The decrease was primarily attributable to a decrease in regulatory assessments and FDIC insurance, partially offset by an increase in other real estate expense.

Asset Quality

Non-performing assets totaled $11.873 million or 0.12% of average earning assets for the three months ended June 30, 2012 compared with $12.680 million or 0.15% of average earning assets for the three months ended June 30, 2011, and $14.873 million or 0.16% of average earnings assets for the three months March 31, 2012.  The allowance for credit losses was 1.28% of total loans at June 30, 2012 compared with 1.42% at June 30, 2011 and 1.33% of total loans at March 31, 2012.

Non-performing assets

(Dollars in thousands)

June 30, 2012

Mar 31, 2012

Dec 31, 2011


Amount

#

Amount

#

Amount

#

Commercial

$      394

12

$    690

15

$      767

17

Construction

4,056

30

4,116

26

4,649

28

1-4 family (including home equity)

2,284

28

3,207

35

3,689

38

Commercial real estate (including multi-family)

5,077

12

6,773

16

2,877

9

Agriculture and agriculture real estate

44

3

67

4

49

3

Consumer

18

3

20

5

21

4

Total

$ 11,873

88

$ 14,873

_ 101

$ 12,052

99








Net charge-offs

(Dollars in thousands)

Three Months Ended

June 30, 2012

Three Months Ended

Mar 31, 2012

Three Months Ended

Dec 31, 2011

Commercial

$            180

$           (15)

$            843

Construction

1,179

22

--

1-4 family (including home equity)

90

50

676

Commercial real estate (including multi-family)

296

18

218

Agriculture and agriculture real estate

(3)

--

153

Consumer

118

27

179

Total

$         1,860

$         102

$         2,069

The provision for credit losses was $600,000 for the three months ended June 30, 2012 compared to $1.400 million for the three months ended June 30, 2011.  Net charge offs were $1.860 million for the three months ended June 30, 2012 compared to $1.229 million for the three months ended June 30, 2011.

The provision for credit losses was $750,000 for the six months ended June 30, 2012 compared to $3.100 million for the six months ended June 30, 2011.  Net charge offs were $1.962 million for the six months ended June 30, 2012 compared to $2.753 million for the six months ended June 30, 2011.

Conference Call

Prosperity's management team will host a conference call on Friday, July 27, 2012 at 10:30 a.m. Eastern Daylight Time (9:30 a.m. Central Daylight Time) to discuss Prosperity's second quarter earnings. Individuals and investment professionals may participate in the call by dialing 800-894-5910, the reference code is PBTX.

Alternatively, individuals may listen to the live webcast of the presentation by visiting Prosperity's website at www.prosperitybanktx.com.  The webcast may be accessed directly from Prosperity's home page under News and Events.

Pending Acquisition of Community National Bank

On June 27, 2012, Prosperity announced the signing of a definitive agreement to acquire Community National Bank, Bellaire, Texas. This is the fifth acquisition announced by Prosperity within the past nine months.  Community National Bank operates one (1) banking office in Bellaire, Texas, in the Houston Metropolitan Area. As of June 30, 2012, Community National Bank reported total assets of $180.6 million, total loans of $68.6 million and total deposits of $162.6 million

Under the terms of the definitive agreement, Prosperity will issue up to 372,396 shares of Prosperity common stock plus $11.4 million in cash for all outstanding shares of Community National Bank capital stock, subject to certain conditions and potential adjustments.  The transaction is subject to customary closing conditions, including the receipt of regulatory approvals and approval of the Community National Bank shareholders.

Pending Acquisition of East Texas Financial Services, Inc.

On December 9, 2011, Prosperity entered into a definitive agreement to acquire East Texas Financial Services, Inc. (OTC BB: FFBT) and its wholly-owned subsidiary, First Federal Bank Texas ("Firstbank"). Firstbank operates four (4) banking offices in the Tyler MSA, including three locations in Tyler, Texas and one location in Gilmer, Texas. As of June 30, 2012, Firstbank reported total assets of $196.2 million, total loans of $143.6 million and total deposits of $120.9 million.

Under the terms of the definitive agreement, Prosperity will issue up to 531,000 shares of Company common stock for all outstanding shares of East Texas Financial Services capital stock, subject to certain conditions and potential adjustments. The transaction is subject to customary closing conditions, including the receipt of regulatory approvals and approval of the stockholders of East Texas Financial Services. On May 4, 2012, East Texas Financial Services and each of its directors were named defendants in a suit brought by East Texas Financial Corporation ("ETFC"), a shareholder of East Texas Financial Services, to block the proposed merger.  The suit was dismissed on July 18, 2012.  The closing date of the transaction is uncertain at this time.

Acquisition of American State Financial Corporation

On July 1, 2012, Prosperity completed the previously announced acquisition of American State Financial Corporation and its wholly owned subsidiary American State Bank (collectively referred to as "ASB").  American State Bank operated thirty-seven (37) full service banking offices in eighteen (18) counties across West Texas. As of June 30, 2012, ASB, on a consolidated basis, reported total assets of $3.16 billion, total loans of $1.24 billion and total deposits of $2.51 billion.

Under the terms of the agreement, Prosperity issued 8,524,835 shares of Prosperity common stock plus $178.5 million in cash for all outstanding shares of American State Financial Corporation capital stock which resulted in a premium of $240.4 million.

Acquisition of The Bank Arlington

On April 1, 2012, Prosperity completed the previously announced acquisition of The Bank Arlington.  The Bank Arlington operated one (1) banking office in Arlington, Texas, in the Dallas/Fort Worth CMSA. As of March 31, 2012, The Bank Arlington reported total assets of $37.3 million, total loans of $22.8 million and total deposits of $33.2 million.

Under the terms of the agreement, Prosperity issued 135,389 shares of Prosperity common stock for all outstanding shares of The Bank Arlington capital stock which resulted in a premium of $2.8 million.

Acquisition of Texas Bankers, Inc.

On January 1, 2012, Prosperity completed the previously announced acquisition of Texas Bankers, Inc. and its wholly-owned subsidiary, Bank of Texas, Austin, Texas.  The three (3) Bank of Texas banking offices in the Austin, Texas CMSA consisted of a location in Rollingwood, which was consolidated with Prosperity's Westlake location and remains in Bank of Texas' Rollingwood banking office; one banking center in downtown Austin, which was consolidated into Prosperity's downtown Austin location; and another banking center in Thorndale. Prosperity now operates thirty-four (34) banking centers in the Central Texas area including Austin and San Antonio. Texas Bankers, Inc. reported, on a consolidated basis, total assets of $77.0 million, total loans of $27.6 million and total deposits of $70.4 million as of December 31, 2011.

Under the terms of the agreement, Prosperity issued 314,953 shares of Prosperity common stock for all outstanding shares of Texas Bankers capital stock which resulted in a premium of $5.2 million.

Prosperity Bancshares, Inc.®

Prosperity Bancshares Inc.®, recently named "America's Best Bank" by Forbes, is a $13.9 billion Houston, Texas based regional financial holding company, formed in 1983. Operating under a community banking philosophy and seeking to develop broad customer relationships based on service and convenience, Prosperity offers a variety of traditional loan and deposit products to its customers, which consist primarily of small and medium sized businesses and consumers. In addition to established banking products, Prosperity offers a complete line of services including: Internet Banking services at http://www.prosperitybanktx.com, Retail Brokerage Services, MasterMoney Debit Cards, and 24 hour voice response banking.  Prosperity currently operates two hundred thirteen (213) full service banking locations; fifty-nine (59) in the Houston area; twenty (20) in the South Texas area including Corpus Christi and Victoria; thirty-five (35) in the Dallas/Fort Worth area; twenty-one (21) in the East Texas area; thirty-four (34) in the Central Texas area including Austin and San Antonio; thirty-four (34) in the West Texas area including Lubbock, Midland/Odessa and Abilene; and ten (10) in the Bryan/College Station area.

 

Bryan/College Station Area -

Kiest

Downtown

Other South Texas Locations -

Bryan

McKinney

Eastex

Alice



Bryan-East

McKinney-Stonebridge

Fairfield

Aransas Pass


Bryan-North

Midway

First Colony

Beeville

Caldwell

Preston Forest

Gessner

Edna



College Station

Preston Road

Gladebrook

Goliad




Greens Prairie

Red Oak

Harrisburg

Kingsville

Madisonville

Sachse

Heights

Mathis


Navasota

The Colony

Highway 6 West

Padre Island

Rock Prairie

Turtle Creek

Hillcroft

Palacios


Wellborn Road

Westmoreland

Little York

Port Lavaca





Central Texas Area -

Fort Worth -

Medical Center

Portland






Austin -

Haltom City

Memorial Drive

Rockport


183

Keller

Northside

Sinton

Allandale

Roanoke

Pasadena

Victoria



Cedar Park

Stockyards

Pecan Grove

Victoria-North


Congress

Other Dallas/Fort Worth Locations -

Piney Point

West Texas Area -

Lakeway

Arlington

River Oaks

Abilene -


Liberty Hill

Azle

Royal Oaks

Antilley Road

Northland

Ennis

Sugar Land

Barrow Street


Oak Hill

Gainesville

SW Medical Center

Cypress Street

Parmer Lane

Glen Rose

Tanglewood

Judge Ely


Research Blvd

Grandbury

Uptown

Mockingbird

Westlake

Mesquite

Waugh Drive








Other Central Texas Locations -

Muenster

West University

Lubbock -


Bastrop

Sanger

Woodcreek

4th Street


Cuero

Waxahachie


66th Street

Dime Box

Weatherford

Other Houston Area Locations -

82nd Street

Dripping Springs


Angleton

86th Street

Elgin

East Texas Area -


98th Street


Flatonia


Bay City

Avenue Q


Georgetown

Athens

Beaumont

North University




Gonzales

Athens-South

Cinco Ranch

Texas Tech Student Union

Hallettsville

Blooming Grove

Cleveland

Midland -


Kingsland

Canton

East Bernard

Wadley


La Grange

Carthage

El Campo

Wall Street



Lexington

Corsicana

Dayton

Odessa -




New Braunfels

Crockett

Galveston

Grandview


Pleasanton

Eustace

Groves

Grant



Round Rock

Grapeland

Hempstead

Kermit Highway

San Antonio

Gun Barrel City

Hitchcock 

Parkway



Schulenburg

Jacksonville

Katy

Other West Texas Locations -


Seguin 

Kerens

Liberty

Big Spring

Smithville

Longview

Magnolia

Brownfield


Thorndale

Mount Vernon

Mont Belvieu

Brownwood


Weimar

Palestine

Nederland

Cisco




Yoakum

Rusk

Needville

Comanche

Yorktown

Seven Points

Shadow Creek

Early





Dallas/Fort Worth Area - 

Teague

Sweeny

Early





Dallas -

Tyler

Tomball



Abrams Centre

Tyler-University

Waller

Floydada

Balch Springs

Winnsboro

West Columbia

Gorman

Camp Wisdom


Wharton

Levelland


Cedar Hill

Houston Area -

Winnie

Littlefield

Central Expressway

Houston -

Wirt


East Renner

Aldine

South Texas Area -

Merkel

Frisco

Allen Parkway

Corpus Christi -

Plainview


Frisco-West

Bellaire

Airline

San Angelo

Independence

Beltway

Carmel

Slaton



Clear Lake

Northwest

Snyder



Copperfield

Saratoga





Cypress

Water Street



 

 

In connection with the proposed merger of Community National Bank into Prosperity Bank, Prosperity will file with the Securities and Exchange Commission a registration statement on Form S-4 to register the shares of Prosperity's common stock to be issued to the shareholders of Community National Bank. The registration statement will include a proxy statement/prospectus which will be sent to the shareholders of Community National Bank seeking their approval of the proposed transaction.

WE URGE INVESTORS AND SECURITY HOLDERS TO READ THE REGISTRATION STATEMENT ON FORM S-4, THE PROXY STATEMENT/PROSPECTUS INCLUDED WITHIN THE REGISTRATION STATEMENT ON FORM S-4 AND ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IN CONNECTION WITH THE PROPOSED TRANSACTION BECAUSE THEY CONTAIN IMPORTANT INFORMATION ABOUT PROSPERITY, COMMUNITY NATIONAL BANK AND THE PROPOSED TRANSACTION.

In connection with the proposed merger of East Texas Financial Services, Inc. into Prosperity, Prosperity has filed with the Securities and Exchange Commission a registration statement on Form S-4 to register the shares of Prosperity's common stock to be issued to the stockholders of East Texas Financial Services. The registration statement includes a proxy statement/prospectus which was sent to the stockholders of East Texas Financial Services seeking their approval of the proposed transaction.

WE URGE INVESTORS AND SECURITY HOLDERS TO READ THE REGISTRATION STATEMENT ON FORM S-4, THE PROXY STATEMENT/PROSPECTUS INCLUDED WITHIN THE REGISTRATION STATEMENT ON FORM S-4 AND ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IN CONNECTION WITH THE PROPOSED TRANSACTION BECAUSE THEY CONTAIN IMPORTANT INFORMATION ABOUT PROSPERITY, EAST TEXAS FINANCIAL SERVICES AND THE PROPOSED TRANSACTION.

Investors and security holders may obtain free copies of these documents through the website maintained by the Securities and Exchange Commission at http://www.sec.gov.  Documents filed with the SEC by Prosperity will be available free of charge by directing a request by telephone or mail to Prosperity Bancshares, Inc., Prosperity Bank Plaza, 4295 San Felipe, Houston, Texas 77027 Attn: Investor Relations. Prosperity's telephone number is (281) 269-7199.

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: This release contains, and the remarks by Prosperity's management on the conference call may contain, forward-looking statements within the meaning of the securities laws that are based on current expectations, assumptions, estimates and projections about Prosperity, and its subsidiaries.  These forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties, many of which are outside of Prosperity's control, that may cause actual results to differ materially from those expressed or implied by the forward-looking statements.  These risks and uncertainties include but are not limited to whether Prosperity can: successfully identify acquisition targets and integrate the businesses of acquired companies and banks;  continue to sustain its current internal growth rate or total growth rate; provide products and services that appeal to its customers; continue to have access to debt and equity capital markets; and achieve its sales objectives.  Other risks include, but are not limited to: the possibility that credit quality could deteriorate; actions of competitors; changes in laws and regulations (including changes in governmental interpretations of regulations and changes in accounting standards); a deterioration or downgrade in the credit quality and credit agency ratings of the securities in Prosperity's securities portfolio; customer and consumer demand, including customer and consumer response to marketing; effectiveness of spending, investments or programs; fluctuations in the cost and availability of supply chain resources; economic conditions, including currency rate fluctuations and interest rate fluctuations; weather; and the stock price volatility associated with "small-cap" companies.  These and various other factors are discussed in Prosperity's Annual Report on Form 10-K for the year ended December 31, 2011 and other reports and statements Prosperity has filed with the SEC. Copies of the SEC filings for Prosperity Bancshares® may be downloaded from the Internet at no charge from www.prosperitybanktx.com.

Prosperity Bancshares, Inc. ®

Financial Highlights

(Dollars and share amounts in thousands, except per share data)



Three Months Ended


June 30, 2012

Mar 31, 2012

Dec 31, 2011

Sept 30, 2011

Selected Earnings and Per

(Unaudited)

(Unaudited)

(Unaudited)

(Unaudited)

Share Data










Total interest income

$          92,874

$       91,616

$         89,658

$          93,189

Total interest expense

9,208

9,770

9,571

10,651

Net interest income

83,666

81,846

80,087

82,538

Provision for credit losses

600

150

1,150

950

Net interest income after





     provision for credit losses

83,066

81,696

78,937

81,588






Total non-interest income

13,656

13,945

14,065

14,581

Total non-interest expense

40,788

40,459

38,385

41,151

Net income before taxes

55,934

55,182

54,617

55,018

Federal income taxes

18,962

18,695

18,211

18,645






Net income

$             36,972

$         36,487

$         36,406

$           36,373






Basic earnings per share

$0.78

$0.77

$0.78

$0.78






Diluted earnings per share

$0.78

$0.77

$0.77

$0.77






Period end shares outstanding

47,474

47,297

46,910

46,893

Weighted average shares





     outstanding (basic)

47,456

47,238

46,893

46,890

Weighted average shares





     outstanding (diluted)

47,608

47,411

47,028

47,033

 

Prosperity Bancshares, Inc. ®

Financial Highlights

(Dollars in thousands)



                Three Months Ended                                         Six Months Ended             


June 30, 2012

June 30, 2011

June 30, 2012

June 30, 2011

Balance Sheet Averages

(Unaudited)

(Unaudited)

(Unaudited)

(Unaudited)






Total loans

$        3,914,352

$        3,631,256

$      3,866,672

$      3,574,207

Investment securities

5,635,810

4,707,217

5,414,033

4,692,639

Federal funds sold and other





     other temporary investments

20,916

13,218

73,536

13,200

Total earning assets

9,571,078

8,351,691

9,354,241

8,280,046

Allowance for credit losses

(50,746)

(51,861)

(51,174)

(51,780)

Cash and due from banks

134,055

125,150

146,016

131,445

Goodwill

932,112

924,537

930,265

924,475

Core deposit intangibles  (CDI)

18,465

25,728

19,283

26,714

Other real estate

10,178

9,743

9,408

11,236

Fixed assets, net

165,784

159,919

164,487

159,592

Other assets

138,263

133,661

133,723

134,423

Total assets

$        10,919,189

$        9,678,568

$      10,706,249

$      9,616,151











Non-interest bearing deposits

$        2,069,965

$        1,770,664

$      2,020,453

$      1,721,967

Interest bearing deposits

6,365,796

5,981,826

6,411,728

6,003,693

Total deposits

8,435,761

7,752,490

8,432,181

7,725,660

Securities sold under





     repurchase agreements

98,968

68,413

76,136

60,058

Federal funds purchased and





     other borrowings

610,499

218,310

441,630

205,201

Junior subordinated





     debentures

85,055

85,055

85,055

88,059

Other liabilities

56,742

54,915

57,523

52,956

Shareholders' equity(A)

1,632,164

1,499,385

1,613,724

1,484,217

Total liabilities and equity

$        10,919,189

$        9,678,568

$      10,706,249

$      9,616,151






(A)  Includes $12,599 and $14,337 in after-tax unrealized gains on available for sale securities for the three month periods ending June 30, 2012 and June 30, 2011, respectively, and $13,012 and $14,243 for the six months ending June 30, 2012 and June 30, 2011, respectively.

 

Prosperity Bancshares, Inc. ®

Financial Highlights

(Dollars in thousands)



                Three Months Ended                                        Six Months Ended             


June 30, 2012

June 30, 2011

June 30, 2012

June 30, 2011

Income Statement Data

(Unaudited)

(Unaudited)

(Unaudited)

(Unaudited)






Interest on loans

$            54,793

$            53,703

$         108,010

$         105,903

Interest on securities

38,072

41,919

76,393

83,123

Interest on federal funds sold





     and other temporary





     investments

9

30

87

35

Total interest income

92,874

95,652

184,490

189,061

Interest expense - deposits

8,083

11,064

16,874

22,576

Interest expense - debentures

648

598

1,311

1,745

Interest expense - other

477

360

793

697

Total interest expense

9,208

12,022

18,978

25,018

Net interest income (B)

83,666

83,630

165,512

164,043

Provision for credit losses

600

1,400

750

3,100

Net interest income after





     provision for credit losses

83,066

82,230

164,762

160,943

Non-sufficient funds (NSF) fees

5,167

6,226

10,556

12,333

Debit card and ATM card income

4,292

3,809

8,128

7,261

Service charges on deposit accounts

2,432

2,511

4,873

4,994

Net gain on sale of assets

70

195

63

360

Net (loss) gain on sale of ORE

(165)

(366)

253

(526)

Net loss on sale of securities

--

(581)

--

(581)

Other non-interest income

1,860

1,736

3,728

3,556

Total non-interest income

13,656

13,530

27,601

27,397






Salaries and benefits (C)

23,572

23,994

46,824

47,198

CDI amortization

1,595

1,943

3,290

3,977

Net occupancy and equipment

3,492

3,547

7,049

7,195

Depreciation

2,028

2,037

4,063

4,058

Data processing





 and software amortization

1,906

1,780

3,438

3,452

Regulatory assessments and FDIC

    insurance

1,659

2,894

3,207

5,895

Other real estate

383

294

1,074

586

Other non-interest expense

6,153

6,025

12,302

11,848

Total non-interest expense

40,788

42,514

81,247

84,209

Net income before taxes

55,934

53,246

111,116

104,131

Federal income taxes

18,962

18,154

37,657

35,161

Net income available





    to common shareholders

$           36,972

$           35,092

$            73,459

$            68,970






(B) Net interest income on a tax equivalent basis would be $84,498 and $84,603 for the three months ended June 30, 2012 and June 30, 2011, respectively, and $167,240 and $165,905 for the six months ended June 30, 2012 and June 30, 2011, respectively.


(C) Salaries and benefits includes stock-based compensation expense of $946 and $936 for the three months ended June 30, 2012 and June 30, 2011, respectively, and $2,161 and $1,643 for the six months ended June 30, 2012 and June 30, 2011, respectively.

 

Prosperity Bancshares, Inc.®

Financial Highlights

(Dollars and share amounts in thousands, except per share data)



As of and for the

Three Months Ended

As of and for the

Six Months Ended



June 30, 2012

June 30, 2011

June 30, 2012

June 30, 2011

Common Share and

(Unaudited)

(Unaudited)

(Unaudited)

(Unaudited)

     Other Data





Employees - FTE

1,666

1,675

1,666

1,675






Book value per share

$              34.63

$            32.24

$            34.63

$            32.24

Tangible book value per share

$              14.60

$              11.99

$            14.60

$            11.99











Period end shares outstanding

47,474

46,888

47,474

46,888

Weighted average shares





     outstanding (basic)

47,456

46,864

47,347

46,799

Weighted average shares





     outstanding (diluted)

47,608

47,057

47,508

47,001






Non-performing Assets (at period end)





Non-accrual  loans

$            1,624

$               3,518

$               1,624

$               3,518

Accruing loans 90 or more





     days past due

--

306

--

306

Restructured loans

--

--

--

--

Total non-performing loans

1,624

3,824

1,624

3,824

Repossessed assets

13

15

13

15

Other real estate

10,236

8,841

10,236

8,841

  Total non-performing assets

$           11,873

$           12,680

$           11,873

$           12,680






Allowance for credit losses at





     end of period

$           50,382

$           51,932

$        50,382

$        51,932






Net charge-offs

$             1,860

$             1,229

$          1,962

$          2,753






Basic earnings per share

$               0.78

$               0.75

$            1.55

$            1.47






Diluted earnings per share

$               0.78

$               0.75

$            1.55

$            1.47

 

Prosperity Bancshares, Inc.®

Financial Highlights



Three Months Ended

Six Months Ended


June 30, 2012

June 30, 2011

June 30, 2012

June 30, 2011

Performance Ratios

(Unaudited)

(Unaudited)

(Unaudited)

(Unaudited)






Return on average





     assets (annualized)  

1.35%

1.45%

1.37%

1.43%

Return on average common





     equity (annualized)  

9.06%

9.36%

9.10%

9.29%

Return on average tangible





     common equity (annualized)

21.70%

25.56%

22.12%

25.88%

Net interest margin (D)





     (tax equivalent) (annualized)

3.55%

4.06%

3.60%

4.04%






Efficiency ratio(E)

41.94%

43.58%

42.09%

43.94%






Asset Quality Ratios










Non-performing assets to





     average earning assets

0.12%

0.15%

0.13%

0.15%

Non-performing assets to loans





     and other real estate

0.30%

0.35%

0.30%

0.35%

Net charge-offs





     to average loans

0.05%

0.03%

0.05%

0.08%

Allowance for credit losses to





     total loans

1.28%

1.42%

1.28%

1.42%






Common Stock Market Price










High

$47.31

$46.75

$47.66

$46.75






Low

$39.87

$40.83

$39.66

$38.23






Period end market price

$42.03

$43.82

$42.03

$43.82






(D) Net interest margin for all periods presented is calculated on an actual 365 day or 366 day basis.


(E) The efficiency ratio is calculated by dividing total non-interest expense (excluding provision for credit losses) by net interest income plus non-interest income (excluding net gains and losses on the sale of securities and assets).  Additionally, taxes are not part of this calculation.

 

Prosperity Bancshares, Inc.®

Financial Highlights

(Dollars in thousands)



June 30, 2012

Mar 31, 2012

Dec 31, 2011

Sept 30, 2011

June 30, 2011

Loan Portfolio

(Unaudited)

(Unaudited)

(Unaudited)

(Unaudited)

(Unaudited)












Commercial

$   491,907

12.5%

$    475,860

12.3%

$   439,854

11.7%

$    451,541

12.1%

$   455,791

12.9%

Construction

466,884

11.8%

484,295

12.5%

482,140

12.8%

490,193

13.1%

483,581

13.2%

1-4 family residential

1,084,936

27.4%

1,036,318

26.7%

1,007,266

26.8%

981,388

26.3%

941,250

25.7%

Home equity

154,147

3.9%

149,597

3.9%

146,999

3.8%

139,553

3.7%

131,213

3.6%

Commercial real estate

1,484,787

37.6%

1,473,925

38.0%

1,441,226

38.3%

1,426,704

38.2%

1,411,501

38.5%

Agriculture (includes agriculture real estate)

192,462

4.9%

178,474

4.6%

170,234

4.5%

168,011

4.5%

160,780

4.4%

Consumer

75,209

1.9%

76,393

2.0%

78,187

2.1%

80,240

2.1%

81,132

2.2%

Total Loans

$3,950,332


$ 3,874,862


$3,765,906


$ 3,737,630


$3,665,248













Deposit Types






















Non-interest bearing DDA

$2,083,910

24.8%

$ 2,088,749

24.4%

$ 1,972,226

24.5%

$ 1,861,907

23.9%

$1,788,756

23.3%

Interest bearing DDA

1,684,492

20.1%

1,671,760

19.6%

1,532,701

19.0%

1,332,914

17.1%

1,358,649

17.7%

Money Market

2,206,220

26.3%

2,312,107

27.1%

2,042,243

25.3%

1,995,248

25.6%

1,878,679

24.5%

Savings

581,480

6.9%

554,211

6.5%

514,780

6.4%

498,451

6.4%

471,082

6.1%

Time < $100

909,616

10.8%

938,911

11.0%

968,806

12.0%

1,005,672

12.9%

1,037,492

13.6%

Time > $100

928,864

11.1%

978,713

11.5%

1,029,498

12.8%

1,104,547

14.1%

1,133,034

14.8%

Total Deposits

$8,394,582


$ 8,544,451


$8,060,254


$ 7,798,739


$7,667,692
























Loan to Deposit Ratio

47.1%


45.3%


46.7%


47.9%


47.8%













Construction Loans






















Single family residential   

construction

$   143,600

30.8%

$   142,584

29.4%

$   136,030

28.2%

$    126,926

25.9%

$   124,995

25.8%

Land development

39,704

8.5%

41,177

8.5%

43,084

8.9%

44,400

9.1%

46,405

9.6%

Raw land

51,070

10.9%

63,006

13.0%

61,177

12.7%

64,178

13.1%

69,769

14.4%

Residential lots

86,201

18.5%

88,054

18.2%

86,848

18.0%

88,600

18.1%

86,515

17.9%

Commercial lots

49,454

10.6%

51,642

10.7%

49,645

10.3%

54,016

11.0%

54,419

11.3%

Commercial construction and other

96,854

20.7%

97,832

20.2%

105,356

21.9%

112,073

22.8%

101,478

21.0%

Total Construction Loans

$   466,884


$   484,295


$   482,140


$   490,193


$   483,581


 

Prosperity Bancshares, Inc.®

Financial Highlights

(Dollars in thousands)



June 30, 2012

Mar 31, 2012

Dec 31, 2011

Sept 30, 2011

June 30, 2011

Balance Sheet Data

 (at period end)

(Unaudited)

(Unaudited)

(Unaudited)

(Unaudited)

(Unaudited)







Total loans

$    3,950,332

$    3,874,862

$    3,765,906

$   3,737,630

$   3,665,248

Investment securities (F)

5,400,044

5,646,529

4,658,936

4,430,530

4,641,664

Federal funds sold

133

445

642

294

350

Allowance for credit losses

(50,382)

(51,642)

(51,594)

(52,513)

(51,932)

Cash and due from banks

152,678

151,467

212,800

211,261

145,910

Goodwill

932,965

929,161

924,537

924,537

924,537

Core deposit intangibles

17,706

19,301

20,996

22,874

24,799

Other real estate

10,236

7,718

8,328

8,216

8,841

Fixed assets, net

166,273

162,676

159,656

160,099

160,119

Other assets

157,366

149,438

122,464

124,159

137,611

Total assets

$  10,737,351

$  10,889,955

$    9,822,671

$   9,567,087

$   9,657,147







Demand deposits

$    2,083,910

$    2,088,749

$    1,972,226

$   1,861,907

$   1,788,756

Interest bearing deposits

6,310,672

6,455,702

6,088,028

5,936,832

5,878,936

Total deposits

8,394,582

8,544,451

8,060,254

7,798,739

7,667,692

Securities sold under






     repurchase agreements

122,743

58,481

54,883

66,166

91,288

Federal funds purchased and






     other borrowings

437,278

527,536

12,790

13,583

248,839

Junior subordinated






     debentures

85,055

85,055

85,055

85,055

85,055

Other liabilities

53,876

64,899

42,424

62,205

52,625

Total liabilities

9,093,534

9,280,422

8,255,406

8,025,748

8,145,499

Shareholders' equity (G)

1,643,817

1,609,533

1,567,265

1,541,339

1,511,648

Total liabilities and equity

$  10,737,351

$   10,889,955

$   9,822,671

$   9,567,087

$   9,657,147







(F) Includes $17,709, $19,542, $20,726, $24,278 and $23,647 in unrealized gains on available for sale securities for the quarterly periods ending June 30, 2012, March 31, 2012, December 31, 2011, September 30, 2011 and June 30, 2011, respectively.


(G) Includes $11,511, $12,702, $13,472, $15,781 and $15,371 in after-tax unrealized gains on available for sale securities for the quarterly periods ending June 30, 2012, March 31, 2012, December 31, 2011, September 30, 2011 and June 30, 2011, respectively.

 

Prosperity Bancshares, Inc.®

Financial Highlights

(Dollars in thousands)



Three Months Ended


June 30, 2012

Mar 31, 2012

Dec 31, 2011

Sept 30, 2011

June 30, 2011

Income Statement Data

(Unaudited)

(Unaudited)

(Unaudited)

(Unaudited)

(Unaudited)







Interest on loans

$            54,793

$        53,217

$        58,899

$        54,471

$        53,703

Interest on securities

38,072

38,321

35,719

38,714

41,943

Interest on federal funds






     sold and other earning






     assets

9

78

40

4

6

    Total interest income

92,874

91,616

89,658

93,189

95,652

Interest expense - deposits

8,083

8,791

8,682

9,717

11,064

Interest expense - debentures

648

663

632

607

598

Interest expense - other

477

316

257

327

360

    Total interest expense

9,208

9,770

9,571

10,651

12,022

    Net interest income

83,666

81,846

80,087

82,538

83,630

Provision for credit losses

600

150

1,150

950

1,400

    Net interest income after






     provision for credit losses

83,066

81,696

78,937

81,588

82,230

Non-sufficient funds (NSF) fees

5,167

5,389

5,860

6,249

6,226

Debit card and ATM card income

4,292

3,836

4,189

3,941

3,809

Service charges on deposit accounts

2,432

2,441

2,515

2,472

2,511

Net gain (loss) on sale of assets

70

(7)

--

17

195

Net (loss) gain on sale of  ORE

(165)

418

(473)

95

(366)

Net loss on sale of  securities 

--

--

--

--

(581)

Other non-interest income

1,860

1,868

1,974

1,807

1,736

    Total non-interest income

13,656

13,945

14,065

14,581

13,530

Salaries and benefits

23,572

23,252

21,258

23,601

23,994

CDI amortization

1,595

1,695

1,879

1,924

1,943

Net occupancy and equipment

3,492

3,557

3,655

3,784

3,547

Depreciation

2,028

2,035

2,051

2,041

2,037

Data processing and






     software  amortization

1,906

1,532

1,417

1,954

1,780

Regulatory assessments and

     FDIC insurance

1,659

1,548

1,518

1,488

2,894

ORE expense

383

691

680

235

294

Other non-interest expense

6,153

6,149

5,927

6,124

6,025

    Total non-interest expense

40,788

40,459

38,385

41,151

42,514

    Net income before taxes

55,934

55,182

54,617

55,018

53,246

Federal income taxes

18,962

18,695

18,211

18,645

18,154

    Net income available






     to common shareholders

$          36,972

$         36,487

$        36,406

$        36,373

$           35,092


 

Prosperity Bancshares, Inc.®

Financial Highlights



Comparative Quarterly

Three Months Ended

Asset Quality, Performance

June 30, 2012

Mar 31, 2012

Dec 31, 2011

Sept 30, 2011

June 30, 2011

     & Capital Ratios

(Unaudited)

(Unaudited)

(Unaudited)

(Unaudited)

(Unaudited)

Return on average






     assets (annualized)

1.35%

1.39%

1.50%

1.52%

1.45%

Return on average common






     equity (annualized)

9.06%

9.15%

9.35%

9.51%

9.36%

Return on average tangible






     equity (annualized)

21.70%

22.57%

23.86%

25.03%

25.56%

Net interest margin






     (tax equivalent) (annualized)

3.55%

3.64%

3.82%

4.02%

4.06%







Employees - FTE

1,666

1,690

1,664

1,678

1,675







Efficiency ratio

41.94%

42.23%

40.77%

42.38%

43.58%

Non-performing assets to






     average earning assets

0.12%

0.16%

0.14%

0.16%

0.15%

Non-performing assets to loans






     and other real estate

0.30%

0.38%

0.32%

0.36%

0.35%

Net charge-offs to






     average loans

0.05%

0.00%

0.06%

0.01%

0.03%

Allowance for credit losses to






     total loans

1.28%

1.33%

1.37%

1.40%

1.42%







Book value per share

$34.63

$34.03

$33.41

$32.87

$32.24







Tangible book value per share

$14.60

$13.98

$13.25

$12.67

$11.99







Tier 1 risk-based capital

16.42%

15.70%

15.90%

15.47%

14.72%







Total risk-based capital

17.49%

16.80%

17.09%

16.69%

15.93%







Tier 1 leverage capital

7.69%

7.68%

7.89%

7.70%

7.24%







Tangible equity to tangible






     assets

7.08%

6.65%

7.00%

6.89%

6.46%







Equity to assets

15.31%

14.78%

15.96%

16.11%

15.65%







 

Prosperity Bancshares, Inc.®

Supplemental Financial Data (Unaudited)

(Dollars in thousands)





Three Months Ended June 30, 2012

Three Months Ended June 30, 2011

YIELD ANALYSIS

Average

Interest Earned

Average

Average

Interest Earned

Average


Balance

/ Interest Paid

Yield/Rate

Balance

/ Interest Paid

Yield/Rate








Interest Earning Assets:







Loans

$      3,914,352

$          54,793

5.63%

$    3,631,256

$          53,703

5.93%

Investment securities

5,635,810

38,072

2.70%

4,707,217

41,919

3.56%

Federal funds sold and other







   earning assets

20,916

9

0.17%

13,218

30

0.91%

  Total interest earning assets

9,571,078

$          92,874

3.90%

8,351,691

$          95,652

4.59%

Allowance for credit losses

(50,746)



(51,861)



Non-interest earning assets

1,398,857



1,378,738



  Total assets

$      10,919,189



$      9,678,568










Interest Bearing Liabilities:







Interest bearing demand deposits

$     1,706,176

$             2,089

0.49%

$     1,403,331

$             2,061

0.59%

Savings and money market deposits

2,779,524

2,444

0.35%

2,403,330

3,348

0.56%

Certificates and other time deposits

1,880,096

3,550

0.76%

2,175,165

5,655

1.04%

Securities sold under repurchase agreements          

98,968

59

0.24%

68,413

110

0.64%

Federal funds purchased and other
  borrowings

610,499

418

0.28%

218,310

250

0.46%

Junior subordinated debentures

85,055

648

3.06%

85,055

598

2.82%

  Total interest bearing
    liabilities

$     7,160,318

$           9,208

0.52%

$     6,353,604

$           12,022

0.76%

Non-interest bearing liabilities:







Non-interest bearing demand deposits

$     2,069,965



$     1,770,664



Other liabilities

56,742



54,915



  Total liabilities

$     9,287,025



$     8,179,183



Shareholders' equity

$     1,632,164



$     1,499,385



  Total liabilities and
    shareholders' equity

$     10,919,189



$     9,678,568










Net Interest Income & Margin


$         83,666

3.52%


$         83,630

4.02%








Net Interest Income & Margin







     (tax equivalent)


$         84,498

3.55%


$         84,603

4.06%

 

Prosperity Bancshares, Inc.®

Supplemental Financial Data (Unaudited)

(Dollars in thousands)





Six Months Ended June 30, 2012

Six Months Ended June 30, 2011

YIELD ANALYSIS

Average

Interest Earned

Average

Average

Interest Earned

Average


Balance

/ Interest Paid

Yield/Rate

Balance

/ Interest Paid

Yield/Rate








Interest Earning Assets:







Loans

$      3,866,672

$          108,010

5.62%

$   3,574,207

$          105,903

5.98%

Investment securities

5,414,033

76,393

2.82%

4,692,639

83,123

3.54%

Federal funds sold and other







   earning assets

73,536

87

0.24%

13,200

35

0.53%

  Total interest earning assets

9,354,241

$          184,490

3.97%

8,280,046

$          189,061

4.60%

Allowance for credit losses

(51,174)



(51,780)



Non-interest earning assets

1,403,182



1,387,885



  Total assets

$      10,706,249



$    9,616,151










Interest Bearing Liabilities:







Interest bearing demand deposits

$     1,700,208

$             4,152

0.49%

$     1,446,008

$             4,299

0.60%

Savings and money market deposits

2,785,936

5,033

0.36%

2,381,326

6,684

0.57%

Certificates and other time deposits

1,925,584

7,689

0.80%

2,176,359

11,593

1.07%

Securities sold under repurchase agreements          

76,136

96

0.25%

60,058

179

0.60%

Federal funds purchased and other
  borrowings

441,630

697

0.32%

205,201

518

0.51%

Junior subordinated debentures

85,055

1,311

3.10%

88,059

1,745

4.00%

  Total interest bearing liabilities

$     7,014,549

$           18,978

0.54%

$     6,357,011

$           25,018

0.79%

Non-interest bearing liabilities:







Non-interest bearing demand deposits

$     2,020,453



$     1,721,967



Other liabilities

57,523



52,956



  Total liabilities

$     9,092,525



$     8,131,934



Shareholders' equity

$     1,613,724



$     1,484,217



  Total liabilities and shareholders' equity

$     10,706,249



$     9,616,151










Net Interest Income & Margin


$         165,512

3.56%


$         164,043

4.00%








Net Interest Income & Margin







     (tax equivalent)


$         167,240

3.60%


$         165,905

4.04%




Prosperity Bancshares, Inc.®

Notes to Selected Financial Data (Unaudited)

(Dollars in thousands)



Consolidated Financial Highlights


NOTES TO SELECTED FINANCIAL DATA


Prosperity's management uses certain non−GAAP (generally accepted accounting principles) financial measures to evaluate its performance. Specifically, Prosperity reviews tangible book value per share, return on average tangible common equity and the tangible equity to tangible assets ratio for internal planning and forecasting purposes. Prosperity has included in this Earnings Release information relating to these non-GAAP financial measures for the applicable periods presented.  Prosperity believes these non-GAAP financial measures provide information useful to investors in understanding Prosperity's financial results and Prosperity believes that its presentation, together with the accompanying reconciliations, provides a complete understanding of factors and trends affecting Prosperity's business and allows investors to view performance in a manner similar to management, the entire financial services sector, bank stock analysts and bank regulators. These non-GAAP measures should not be considered a substitute for GAAP basis measures and results and Prosperity strongly encourages investors to review its consolidated financial statements in their entirety and not to rely on any single financial measure. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies' non-GAAP financial measures having the same or similar names.

 

Prosperity Bancshares, Inc.®

Notes to Selected Financial Data (Unaudited)

(Dollars and share amounts in thousands)





Three Months Ended



Jun 30, 2012

Mar 31, 2012

Dec 31, 2011

Sept 30, 2011

June 30, 2011


Return on average tangible common equity:






Net income

$       36,972

$      36,487

$     36,406

$      36,373

$     35,092


Average shareholders' equity

1,632,164

1,595,284

1,556,845

1,529,718

1,499,385


Less: Average goodwill and other intangible assets

(950,577)

(948,519)

(946,427)

(948,351)

(950,265)


       Average tangible shareholders' equity

$     681,587

$    646,765

$   610,418

$    581,367

$   549,120


Return on average tangible common equity (annualized):

21.70%

22.57%

23.86%

25.03%

25.56%









Tangible book value per share:







Shareholders' equity

$  1,643,817

$ 1,609,533

$1,567,265

$  1,541,339

$1,511,648


Less: Goodwill and other intangible assets

(950,671)

(948,462)

(945,533)

(947,411)

(949,336)


         Tangible shareholders' equity

$     693,146

$     661,071

$   621,732

$    593,928

$   562,312









Period end shares outstanding

47,474

47,297

46,910

46,893

46,888


Tangible book value per share:

$         14.60

$         13.98

$       13.25

$        12.67

$       11.99









Tangible equity to tangible assets ratio:







Tangible shareholders' equity

$    693,146

$     661,071

$  621,732

$   593,928

$  562,312









Total assets

$10,737,351

$10,889,955

$9,822,671

$9,567,087

$9,657,147


Less: Goodwill and other intangible assets

(950,671)

(948,462)

(945,533)

(947,411)

(949,336)


       Tangible assets

$ 9,786,680

$  9,941,493

$8,877,138

$8,619,676

$8,707,811









Tangible equity to tangible assets ratio:

7.08%

6.65%

7.00%

6.89%

6.46%


 

Prosperity Bancshares, Inc.®

Notes to Selected Financial Data (Unaudited)

(Dollars in thousands)




Six Months Ended


June 30, 2012

June 30, 2011

Return on average tangible common equity:

Net income

$       73,459

$     68,970

Average shareholders' equity

1,613,724

1,484,217

Less: Average goodwill and other intangible assets

(949,548)

(951,189)

       Average tangible shareholders' equity

$     664,176

$   533,028

Return on average tangible common equity (annualized):

22.12%

25.88%




Tangible book value per share:

Shareholders' equity

$  1,643,817

$1,511,648

Less: Goodwill and other intangible assets

(950,671)

(949,336)

         Tangible shareholders' equity

$     693,146

$   562,312




Period end shares outstanding

47,474

46,888

Tangible book value per share:

$         14.60

$        11.99




Tangible equity to tangible assets ratio:



Tangible shareholders' equity

$     693,146

$    562,312




Total assets

$10,737,351

$9,657,147

Less: Goodwill and other intangible assets

(950,671)

(949,336)

       Tangible assets

$  9,786,680

$8,707,811




Tangible equity to tangible assets ratio:

7.08%

6.46%

SOURCE Prosperity Bancshares, Inc.

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