Cullen/Frost Q3 profit rises as average loans grow 9%

Cullen/Frost Bankers, Inc. (CFR) said on Oct. 29 that third-quarter net income available to common shareholders was $178.5 million, or $2.84 per diluted common share, up from $2.67 a year earlier. The result was in line with the $2.82 consensus estimate compiled by Finnhub.

The San Antonio company is a financial holding company with $54.5 billion in assets at Sept. 30, 2026, and it provides banking, investment and insurance services across Texas.

Here's how the company did:

• Net income available to common shareholders: $178.5 million vs. $172.7 million a year earlier
• Diluted EPS: $2.84 vs. $2.67 a year earlier, in line with the $2.82 consensus estimate compiled by Finnhub
• Net interest income, taxable-equivalent: $490.8 million, up 5.8% from a year earlier
• Non-interest income: $136.0 million vs. $125.6 million a year earlier

Loans and deposits

Average loans rose 9.0% to $23.4 billion from $21.5 billion a year earlier. They also rose 3.3% from the second quarter.

Average deposits rose 3.6% to $43.6 billion from $42.1 billion a year earlier, and rose 2.3% from the second quarter.

Phil Green, Chairman and CEO, said, "As more and more people and businesses continue to move into Texas from other parts of the country, we see great opportunity to continue extending the Frost experience to more new Texans." He added that the company grew managed customer accounts in its wealth management business by more than 5% compared with a year ago.

Credit quality

Credit loss expense was $12.1 million, up from $6.8 million in the third quarter of 2025. Net charge-offs were $8.4 million.

Non-accrual loans were $63.7 million at the end of the quarter, down from $112.7 million at the end of the second quarter and up from $44.8 million a year earlier. The allowance for credit losses on loans was 1.23% of total loans, compared with 1.31% a year earlier.

Expenses and capital

Non-interest expense was $377.2 million, up $24.7 million, or 7.0%, from a year earlier. Salaries and wages rose 7.7%, which the company attributed in part to annual merit and market increases and to growth in headcount.

The Common Equity Tier 1 capital ratio was 13.76% at the end of the quarter.

During the quarter the company repurchased 92,700 common shares at a total cost of $15.0 million. It had $125.0 million remaining under its $300 million repurchase authorization, which expires in January 2027.

Dividends

The board declared a fourth-quarter cash dividend of $1.03 per common share, payable Dec. 15, 2026, to shareholders of record on Nov. 30.

The board also declared a dividend of $11.125 per share on its Series B Preferred Stock, or 27.8125 cents per depositary share. It is payable on the same dates.

Nine-month results

For the first nine months of 2026, net income available to common shareholders was $518.2 million, up 8.6% from $477.3 million a year earlier. Diluted EPS was $8.19, up from $7.36.