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EX - 99.1 2 brhc10027250_ex99-1.htm EXHIBIT 99.1 Exhibit 99.1 South Plains Financial , Inc. South Plains Financial , Inc. Reports Second Quarter 2021 Financial Results LUBBOCK , Texas , July 27 , 2021 ( GLOBE NEWSWIRE ) South Plains Financial , Inc. ( NASDAQ : SPFI ) ( " South Plains " or the " Company " ) , the parent company of City Bank ( " City Bank ” or the “ Bank ” ) , today reported its financial results for the quarter ended June 30 , 2021 . Second Quarter 2021 Highlights • Net income for the second quarter of 2021 was $ 13.7 million , compared to $ 15.2 million for the first quarter of 2021 and $ 5.6 million for the second quarter of 2020 . • • • • • • • Diluted earnings per share for the second quarter of 2021 was $ 0.74 , compared to $ 0.82 for the first quarter of 2021 and $ 0.31 for the second quarter of 2020 . Pre - tax , pre - provision income ( non - GAAP ) for the second quarter of 2021 was $ 15.1 million , compared to $ 19.0 million for the first quarter of 2021 and $ 20.1 million for the second quarter of 2020 . Average cost of deposits for the second quarter of 2021 decreased to 27 basis points , compared to 29 basis points for the first quarter of 2021 and 39 basis points for the second quarter of 2020 . The Company had a negative provision for loan losses in the second quarter of 2021 of $ 2.0 million , compared to provisions for loan losses of $ 89,000 for the first quarter of 2021 and $ 13.1 million for the second quarter of 2020 . Nonperforming assets to total assets were 0.37 % at June 30 , 2021 , compared to 0.42 % at March 31 , 2021 and 0.33 % at June 30 , 2020 . Return on average assets for the second quarter of 2021 was 1.46 % annualized , compared to 1.66 % annualized for the first quarter of 2021 and 0.64 % annualized for the second quarter of 2020 . Tangible book value ( non - GAAP ) per share was $ 20.43 as of June 30 , 2021 , compared to $ 19.28 per share as of March 31 , 2021 and $ 17.06 per share as of June 30 , 2020 . Curtis Griffith , South Plains ' Chairman and Chief Executive Officer , commented , " Economic activity continued to accelerate across Texas through the second quarter of 2021 as can be seen in our improved loan growth of 2.7 % as compared to the first quarter of 2021 as well as our loan pipeline which ended the second quarter at a three year high . While demand is improving , we also see an opportunity to expand our loan portfolio and have implemented an initiative to grow our banking team by more than 30 % over the next two years with a focus on our major metropolitan markets of Dallas and Houston . We believe we have significant earnings power sitting on our balance sheet given our low cost of funds combined with our excess liquidity as our loan to deposit ratio was 73 % at June 30 , 2021. As we execute on our plan and redeploy our excess liquidity into attractive , higher yielding loans , we believe our margins will begin to expand and our earnings growth will accelerate . That said , we will not sacrifice credit quality for growth and will maintain our conservative credit culture as we expand our loan portfolio . I am also pleased that the credit quality of our loan portfolio continued to improve through the second quarter of 2021 , allowing us to begin to release reserve for loan losses . Given our strong fundamentals , improving loan growth outlook , and strong credit quality of our loan portfolio , we continued repurchasing shares of our common stock in the second quarter of 2021 given the attractive value that we see . " Results of Operations , Quarter Ended June 30 , 2021 Net Interest Income Net interest income was $ 29.6 million for the second quarter of 2021 , compared to $ 29.5 million for the first quarter of 2021 and $ 30.4 million for the second quarter of 2020. Net interest margin was 3.42 % for the second quarter of 2021 , compared to 3.52 % for the first quarter of 2021 and 3.79 % for the second quarter of 2020. The average yield on loans was 4.97 % for the second quarter of 2021 , compared to 5.07 % for the first quarter of 2021 and 5.06 % for the second quarter of 2020. The average cost of deposits was 27 basis points for the second quarter of 2021 , representing a two basis point decrease from the first quarter of 2021 and a 12 basis point decrease from the second quarter of 2020 . Interest income was $ 33.0 million for the second quarter of 2021 , compared to $ 33.0 million for the first quarter of 2021 and $ 34.0 million for the second quarter of 2020. Although interest income was flat in the second quarter of 2021 compared to the first quarter of 2021 , there was a change in the mix of loan interest income . In the second quarter of 2021 , interest and fees on Small Business Administration ( " SBA " ) Paycheck Protection Program ( " PPP ” ) loans declined $ 721 thousand compared to the first quarter of 2021 , as the average balance of PPP loans decreased $ 22.5 million during the second quarter of 2021 , offset by an increase in interest income on non - PPP loans of $ 801 thousand , due to growth of $ 48.7 million in average non - PPP loans during the second quarter of 2021. Interest income decreased by $ 1.0 million in the second quarter of 2021 compared to the second quarter of 2020 primarily due to lower interest rates on loans , securities , and other interest - earning assets , partially offset by growth in average securities and other interest - earning assets . During the second quarter of 2021 , the Company recognized $ 1.9 million in PPP - related fees . At June 30 , 2021 , the Company had $ 4.6 million of deferred PPP fees that