Abilene – October 15, 2026 -- First Financial Bankshares (NASDAQ: FFIN) reported third-quarter 2026 earnings of $74.31 million, up from $52.27 million a year earlier and $71.89 million in the second quarter. Diluted earnings per share rose to $0.52 from $0.36 in the third quarter of 2025 and $0.50 in the linked quarter.
CEO David Bailey called it "another record quarter of net income," driven largely by continued net interest margin expansion.
Net interest margin climbs to 3.91% as net interest income reaches $138.51 million
Net interest income totaled $138.51 million, compared with $127.00 million a year ago and $136.91 million in the second quarter. The tax-equivalent net interest margin was 3.91%, against 3.80% in the third quarter of 2025 and 3.90% in the linked quarter. Average interest-earning assets were $14.43 billion, up from $13.60 billion a year earlier but slightly below $14.46 billion in the second quarter.
Credit provision drops to $2.03 million after prior-year fraud-related charge-off
The provision for credit losses fell to $2.03 million from $24.44 million a year earlier, when a large loan charged off due to borrower fraud drove the expense. The linked-quarter provision was $4.18 million. Net charge-offs were $935 thousand, compared with $22.34 million in the third quarter of 2025 and net recoveries of $600 thousand in the second quarter.
The allowance for credit losses stood at $113.89 million, or 1.33% of loans held-for-investment, versus 1.29% a year ago and 1.35% at June 30. Nonperforming assets were 0.71% of loans and foreclosed assets, unchanged from a year earlier and down from 0.80% at June 30. Classified loans rose to $294.49 million from $252.96 million a year ago and $283.10 million at June 30.
Loans grow 9.12% annualized in the quarter to reach $8.54 billion
Loans increased $191.86 million from June 30, a 9.12% annualized pace, and have grown $380.51 million, or 6.24% annualized, year-to-date. Noninterest-bearing deposits grew $67.07 million, or 7.65% annualized, in the quarter. Deposits and repurchase agreements totaled $13.19 billion, and total assets were $15.16 billion, down from $15.31 billion at June 30.
Wealth management fees rise to $14.49 million while mortgage income slips
Noninterest income was $35.64 million, versus $34.26 million a year ago and $35.84 million in the second quarter. Wealth management fees increased to $14.49 million from $12.95 million a year earlier, on new account growth and higher mineral fee income tied to oil and gas prices. Assets under management reached $12.35 billion. Service charges on deposits rose to $6.69 million from $6.45 million.
Mortgage income fell to $4.18 million from $4.38 million a year earlier and $4.68 million in the linked quarter. Volume and margins were hurt by a spike in long-term rates during the quarter.
Noninterest expense rises to $81.05 million, lifting efficiency ratio to 45.59%
Noninterest expense was $81.05 million, compared with $73.67 million a year ago and $81.11 million in the second quarter. Salary, commissions and benefits, excluding the SERP market adjustment, were $47.79 million versus $42.32 million a year earlier, reflecting merit-based and market-driven raises effective March 1. Non-salary expenses rose $2.18 million year over year, on higher legal and professional fees, software amortization and advertising costs, partly offset by lower operational losses and debit card expenses. The efficiency ratio was 45.59%, against 44.74% a year ago and 45.94% in the linked quarter.
Securities losses of $489.55 million cut shareholders' equity to $1.83 billion
Shareholders' equity fell to $1.83 billion from $2.00 billion at June 30, matching the level of a year earlier. The decline stemmed mainly from a $209.89 million, net-of-tax increase in unrealized securities losses. Net of tax, those losses totaled $489.55 million, compared with $308.58 million at September 30, 2025 and $279.67 million at June 30, 2026, reflecting changes in long-term market interest rates.
Bailey said the bank will open its Bee Cave location this month, its first full-service branch in the Austin market.