☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Texas		75-2453320
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)
5219 City Bank Parkway Lubbock, Texas		79407
(Address of principal executive offices)		(Zip Code)

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $1.00 par value per share	SPFI	The Nasdaq Stock Market, LLC

Large accelerated filer	☐		Accelerated filer	☒
Non-accelerated filer	☐		Smaller reporting company	☐
			Emerging growth company	☐

		Page
PART I.	FINANCIAL INFORMATION	3
Item 1.	Consolidated Financial Statements	3
	Consolidated Balance Sheets (Unaudited)	3
	Consolidated Statements of Comprehensive Income (Unaudited)	4
	Consolidated Statements of Changes in Stockholders’ Equity (Unaudited)	5
	Consolidated Statements of Cash Flows (Unaudited)	6
	Notes to Consolidated Financial Statements (Unaudited)	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	26
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	45
Item 4.	Controls and Procedures	45
PART II.	OTHER INFORMATION	46
Item 1.	Legal Proceedings	46
Item 1A.	Risk Factors	46
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	46
Item 3.	Defaults Upon Senior Securities	46
Item 4.	Mine Safety Disclosures	46
Item 5.	Other Information	46
Item 6.	Exhibits	47
Signatures		48

		March 31, 2026				December 31, 2025
		(Unaudited)
ASSETS
Cash and due from banks		$	45,881			$	58,318
Interest-bearing deposits in banks			676,119				494,121
Cash and cash equivalents			722,000				552,439
Securities available for sale			602,852				567,540
Loans held for sale ($15,471 and $7,796 at fair value at March 31, 2026 and December 31, 2025, respectively)			17,203				9,993
Loans held for investment			3,103,529				3,144,502
Allowance for credit losses on loans			(44,822	)			(45,131	)
Loans held for investment, net			3,058,707				3,099,371
Accrued interest receivable			17,009				20,931
Premises and equipment, net			51,585				51,563
Bank-owned life insurance			78,119				77,694
Goodwill			19,315				19,315
Intangible assets, net			1,012				1,133
Mortgage servicing rights			24,611				24,041
Deferred tax asset, net			20,244				20,433
Other assets			33,717				36,047
Total assets		$	4,646,374			$	4,480,500
LIABILITIES AND STOCKHOLDERS’ EQUITY
Deposits:
Noninterest-bearing		$	1,034,117			$	1,023,517
Interest-bearing			2,993,469				2,850,560
Total deposits			4,027,586				3,874,077
Accrued expenses and other liabilities			53,356				52,093
Subordinated debt			14,100				14,100
Junior subordinated deferrable interest debentures			46,393				46,393
Total liabilities			4,141,435				3,986,663
Stockholders’ equity:
Common stock, $1.00 par value per share, 30,000,000 shares authorized; 16,342,219 and 16,293,577 issued and outstanding at March 31, 2026 and December 31, 2025, respectively			16,342				16,294
Additional paid-in capital			91,244				91,065
Retained earnings			445,971				434,197
Accumulated other comprehensive loss			(48,618	)			(47,719	)
Total stockholders’ equity			504,939				493,837
Total liabilities and stockholders’ equity		$	4,646,374			$	4,480,500

		Three Months Ended March 31,
		2026				2025
Interest income:
Loans, including fees		$	52,677			$	50,570
Securities:
Taxable			4,285				4,692
Non-taxable			853				801
Federal funds sold and interest-bearing deposits in banks			4,817				3,859
Total interest income			62,632				59,922
Interest expense:
Deposits			18,878				19,827
Subordinated debt			243				835
Junior subordinated deferrable interest debentures			659				733
Total interest expense			19,780				21,395
Net interest income			42,852				38,527
Provision for credit losses			260				420
Net interest income, after provision for credit losses			42,592				38,107
Noninterest income:
Service charges on deposit accounts			2,255				2,141
Net gain on sales of loans			2,332				2,591
Bank card services and interchange fees			3,216				3,379
Other mortgage banking income (loss)			1,586				(478	)
Investment commissions			555				434
Fiduciary fees			789				738
Other			562				1,820
Total noninterest income			11,295				10,625
Noninterest expense:
Salaries and employee benefits			20,154				19,441
Occupancy and equipment, net			3,953				4,027
Professional services			2,955				1,730
Marketing and development			1,001				905
IT and data services			1,381				1,164
Bank card expenses			1,608				1,454
Other			4,474				4,309
Total noninterest expense			35,526				33,030
Income before income taxes			18,361				15,702
Income tax expense			3,816				3,408
Net income		$	14,545			$	12,294

Earnings per share:
Basic		$	0.89			$	0.75
Diluted		$	0.85			$	0.72
Net income		$	14,545			$	12,294
Other comprehensive income (loss):
Unrealized gains (losses) on securities available for sale			(1,112	)			5,640
Less: Change in fair value on hedged state and municipal securities			(26	)			(2,252	)
Tax effect			239				(711	)
Other comprehensive income (loss)			(899	)			2,677
Comprehensive income		$	13,646			$	14,971

		Common Stock								Additional Paid-in				Retained				Accumulated Other Comprehensive
		Shares				Amount				Capital				Earnings				Loss				Total
Three Months Ended March 31, 2025
Balance at beginning of period			16,455,826			$	16,456			$	97,287			$	385,827			$	(60,621	)		$	438,949
Net income			—				—				—				12,294				—				12,294
Cash dividends declared - $0.15 per share			—				—				—				(2,469	)			—				(2,469	)
Other comprehensive income			—				—				—				—				2,677				2,677
Net issuance of stock related to stock-based awards			21,107				21				(283	)			—				—				(262	)
Stock issued under employee stock purchase plan			8,714				9				226				—				—				235
Repurchases of common stock			(250,000	)			(250	)			(8,000	)			—				—				(8,250	)
Stock-based compensation			—				—				569				—				—				569
Balance at end of period			16,235,647			$	16,236			$	89,799			$	395,652			$	(57,944	)		$	443,743
Three Months Ended March 31, 2026
Balance at beginning of period			16,293,577			$	16,294			$	91,065			$	434,197			$	(47,719	)		$	493,837
Net income			—				—				—				14,545				—				14,545
Cash dividends declared - $0.17 per share			—				—				—				(2,771	)			—				(2,771	)
Other comprehensive loss			—				—				—				—				(899	)			(899	)
Net issuance of stock related to stock-based awards			40,190				40				(739	)			—				—				(699	)
Stock issued under employee stock purchase plan			8,452				8				250				—				—				258
Stock-based compensation			—				—				668				—				—				668
Balance at end of period			16,342,219			$	16,342			$	91,244			$	445,971			$	(48,618	)		$	504,939

		Three Months Ended March 31,
		2026				2025
Cash flows from operating activities:
Net income		$	14,545			$	12,294
Adjustments to reconcile net income to net cash from operating activities:
Provision for credit losses			260				420
Provision for foreclosed asset losses			100				—
Depreciation and amortization			1,502				1,478
Accretion and amortization			559				738
Other gains, net			(99	)			(149	)
Net gain on sales of loans			(2,332	)			(2,591	)
Proceeds from sales of loans held for sale			57,711				73,385
Loans originated for sale			(62,909	)			(64,382	)
Deferred income tax expense			428				185
Earnings on bank-owned life insurance			(425	)			(405	)
Stock-based compensation			668				569
Change in valuation of mortgage servicing rights			(250	)			1,585
Net change in:
Accrued interest receivable and other assets			5,409				6,651
Accrued expenses and other liabilities			1,003				(3,683	)
Net cash from operating activities			16,170				26,095
Cash flows from investing activities:
Activity in securities available for sale:
Purchases			(351,389	)			—
Maturities, prepayments, and calls			314,406				10,661
Loan originations and principal collections, net			40,439				(21,821	)
Purchases of premises and equipment			(1,354	)			(1,135	)
Proceeds from sales of premises and equipment			38				2,093
Proceeds from sales of foreclosed assets			954				428
Net cash from investing activities			3,094				(9,774	)
Cash flows from financing activities:
Net change in deposits			153,509				171,643
Proceeds from common stock issuance			258				235
Payments to tax authorities for stock-based compensation			(699	)			(262	)
Cash dividends paid on common stock			(2,771	)			(2,469	)
Payments to repurchase common stock			—				(8,250	)
Net cash from financing activities			150,297				160,897
Net change in cash and cash equivalents			169,561				177,218
Beginning cash and cash equivalents			552,439				359,082
Ending cash and cash equivalents		$	722,000			$	536,300
Supplemental disclosures of cash flow information:
Interest paid on deposits and borrowed funds		$	20,216			$	22,485
Income taxes paid			—				—
Supplemental schedule of noncash activities:
Loans transferred to foreclosed assets		$	225			$	498
Additions to mortgage servicing rights			320				199

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Nature of Operations – South Plains Financial, Inc. (“SPFI”) is a Texas corporation and registered bank holding company that conducts its principal activities through its subsidiaries from offices located throughout Texas and Eastern New Mexico. Principal activities include commercial and retail banking, along with investment, trust, and mortgage services. The following were subsidiaries of SPFI as of March 31, 2026:

Wholly-Owned, Consolidated Subsidiaries:
City Bank	Bank subsidiary
Ruidoso Retail, Inc.	Non-bank subsidiary
CB Provence, LLC	Non-bank subsidiary
CBT Brushy Creek, LLC	Non-bank subsidiary
CBT Properties, LLC	Non-bank subsidiary
Wholly-Owned, Equity Method Subsidiaries:
South Plains Financial Capital Trusts (“SPFCT”) III-V	Non-bank subsidiaries

Basis of Presentation and Consolidation – The consolidated financial statements in this Quarterly Report on Form 10-Q for the three months ended March 31, 2026 (this “Form 10-Q”) include the accounts of SPFI and its wholly-owned consolidated subsidiaries (collectively referred to as the “Company”) identified above. All significant intercompany balances and transactions have been eliminated in consolidation.

The interim consolidated financial statements in this Form 10-Q have not been audited by an independent registered public accounting firm, but in the opinion of management, reflect all adjustments necessary for a fair presentation of the Company’s financial position, results of operations, and cash flows. All such adjustments were of a normal and recurring nature. The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q adopted by the U.S. Securities and Exchange Commission (“SEC”). Accordingly, the financial statements do not include all of the information and notes required by GAAP for complete financial statements and should be read in conjunction with the Company’s audited consolidated financial statements, and notes thereto in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025 as filed with the SEC on March 5, 2026 (the “2025 Annual Report on Form 10-K”). Operating results for the interim periods disclosed herein are not necessarily indicative of the results that may be expected for a full year or any future period.

Use of Estimates – The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Determination of the adequacy of the allowance for credit losses (“ACL”) is a material estimate that is particularly susceptible to significant changes in the near term.

Recent Accounting Pronouncements – Updates to the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) are prescribed in Accounting Standards Updates (“ASUs”), which are not authoritative until incorporated into the ASC.

ASU 2023-06, Disclosure Improvements: Codification Amendments in Response to the SEC’s Disclosure Update and Simplification Initiative. The amendments in this ASU modify the disclosure or presentation requirements of a variety of Topics in the Codification. Certain of the amendments represent clarifications to, or technical corrections of the current requirements. Each amendment in this ASU will only become effective if the SEC removes the related disclosure or presentation requirement from its existing regulations by June 30, 2027. The amendments in this ASU are not expected to have a material impact on the Company’s financial statements.

ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses. This ASU requires public companies to disclose in tabular format, in the notes to the financial statements, specific disaggregated information about certain prescribed categories of expenses at each interim and annual reporting period. The prescribed categories include, among other things, employee compensation, depreciation, and intangible asset amortization. This ASU is effective for public business entities for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Implementation of this ASU may be applied prospectively or retrospectively. The Company does not expect the adoption of this ASU to have a material impact on the Company’s financial statements.

ASU 2025-08 Financial Instruments - Credit Losses (Topic 326): Purchased Loans. This ASU amends the guidance in ASC 326 on the accounting for certain purchased loans. Under this ASU, entities must account for acquired loans (excluding credit cards) that meet certain criteria at acquisition (“purchased seasoned loans”) by recognizing them at their purchase price plus an allowance for expected credit losses (the “gross-up” approach). This ASU’s amendments align the accounting for purchased seasoned loans with the treatment of financial assets purchased with more-than-insignificant credit deterioration since origination (“PCD”). Purchased seasoned loans are defined under this ASU as non-PCD loans that are obtained in a business combination, or non-PCD loans that (1) are obtained in an asset acquisition or upon consolidation of a variable interest entity that is not a business and (2) are acquired more than 90 days after their origination date by a transferee that was not involved in their origination. This ASU also introduces an accounting policy election related to the subsequent measurement of expected credit losses for entities that use a method other than a discounted cash flow analysis to estimate credit losses on purchased seasoned loans. If this accounting policy is elected, entities can use the amortized cost basis of the asset to subsequently measure their credit loss allowance. Accordingly, they can aggregate purchased and originated loans when adjusting estimates of credit losses for assets that share similar risk characteristics. This update is effective for annual reporting periods beginning after December 15, 2026, including interim reporting periods, and the adoption of this ASU must be applied prospectively. Early adoption is permitted in an interim or annual reporting period in which financial statements have not yet been issued or made available for issuance. An entity that adopts the amendments in an interim reporting period may apply them “as of the beginning of that interim reporting period or the beginning of the annual reporting period that includes that interim reporting period.” The Company expects to early adopt ASU 2025-08 in the second quarter of 2026 and apply it as part of the purchase accounting for BOH Holdings, Inc. The Company is currently evaluating the impact on its disclosures.

ASU 2025-11 Interim Reporting (Topic 270): Narrow-Scope Improvements. This ASU is intended to improve the navigability of the guidance in ASC 270 and clarify when it applies. Under the amendments, an entity is subject to ASC 270 if it provides “interim financial statements and notes in accordance with GAAP.” This ASU also addresses the form and content of such financial statements, adds lists to ASC 270 of the interim disclosures required by all other Codification topics, and establishes a principle under which an entity must “disclose events since the end of the last annual reporting period that have a material impact on the entity.” As the Board stated in the proposed guidance and reiterates in this ASU, the amendments are not intended to “change the fundamental nature of interim reporting or expand or reduce current interim disclosure requirements.” This update is effective for interim reporting periods within annual reporting periods beginning after December 15, 2027, early adoption is permitted. The amendments in this ASU are not expected to have a material impact on the Company’s financial statements.

Subsequent Events – The Company has evaluated subsequent events and transactions from March 31, 2026 through the date this Form 10-Q was filed with the SEC for potential recognition or disclosure as required by GAAP.

2. MERGERS AND ACQUISITIONS

On December 1, 2025, SPFI and BOH Holdings, Inc., a Texas corporation (“BOH”), entered into an Agreement and Plan of Reorganization (the “Reorganization Agreement”), which provided for the acquisition by SPFI of BOH through the merger of BOH with and into SPFI, with SPFI surviving the merger (the “Merger”). At March 31, 2026, BOH had $685.0 million in assets, $631.9 million in total gross loans, and $595.6 million in deposits. Pursuant to the terms and subject to the conditions of the Reorganization Agreement, each share of BOH common stock held prior to the effective time of the Merger would be converted into the right to receive, without interest, 0.1925 shares of SPFI common stock, subject to adjustment pursuant to the terms of the Reorganization Agreement (the “Exchange Ratio”), plus cash in lieu of any fractional shares.

The Reorganization Agreement provided that immediately following the consummation of the Merger, Bank of Houston, a Texas state banking association and wholly-owned subsidiary of BOH, would be merged with and into City Bank, a Texas state banking association and wholly-owned subsidiary of SPFI, with City Bank surviving the merger. See Note 15 for additional details.

3. SECURITIES

Securities available for sale are summarized as follows as of the dates presented below (dollars in thousands):

		Amortized Cost				Gross Unrealized Gains				Gross Unrealized Losses				Allowance for Credit Losses				Fair Value
March 31, 2026
Available for sale:
U.S government and agencies		$	49,990			$	—			$	—			$	—			$	49,990
State and municipal			198,274				269				(25,346	)			—				173,197
Residential mortgage-backed securities			295,057				91				(41,083	)			—				254,065
Commercial mortgage-backed securities			49,924				—				(4,091	)			—				45,833
Commercial collateralized mortgage obligations			67,206				39				(178	)			—				67,067
Asset-backed and other amortizing securities			13,550				—				(850	)			—				12,700
Other securities			—				—				—				—				—
		$	674,001			$	399			$	(71,548	)		$	—			$	602,852

December 31, 2025
Available for sale:
State and municipal		$	199,417			$	388			$	(23,500	)		$	—			$	176,305
Residential mortgage-backed securities			302,711				130				(42,081	)			—				260,760
Commercial mortgage-backed securities			48,769				—				(3,983	)			—				44,786
Commercial collateralized mortgage obligations			67,708				77				(188	)			—				67,597
Asset-backed and other amortizing securities			13,972				—				(840	)			—				13,132
Other securities			5,000				—				(40	)			—				4,960
		$	637,577			$	595			$	(70,632	)		$	—			$	567,540

The amortized cost and estimated fair value of securities at March 31, 2026 are presented below by contractual maturity (dollars in thousands). Expected maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations. Declining-balance securities are shown separately since they are not due at a single maturity date.

		Available for Sale
		Amortized Cost				Fair Value
Within 1 year		$	49,990			$	49,990
After 1 year through 5 years			5,072				5,015
After 5 years through 10 years			13,909				13,067
After 10 years			179,293				155,115
Declining-balance securities			425,737				379,665
		$	674,001			$	602,852

At both March 31, 2026 and December 31, 2025, there were no holdings of securities of any one issuer, other than the U.S. government, its agencies, or its sponsored enterprises, in an amount greater than 10% of stockholders’ equity.

Securities with a carrying value of approximately $469.7 million and $413.7 million at March 31, 2026 and December 31, 2025, respectively, were pledged to collateralize public deposits and for other purposes as required or permitted by law.

The following table segregates securities with unrealized losses at the dates indicated, by the duration they have been in a loss position for which an allowance for credit losses has not been recorded (dollars in thousands):

		Less than 12 Months								12 Months or More								Total
		Fair Value				Unrealized Loss				Fair Value				Unrealized Loss				Fair Value				Unrealized Loss
March 31, 2026
State and municipal		$	277			$	2			$	162,047			$	25,344			$	162,324			$	25,346
Residential mortgage-backed securities			3,055				77				243,723				41,006				246,778				41,083
Commercial mortgage-backed securities			4,954				56				40,879				4,035				45,833				4,091
Commercial collateralized mortgage obligations			62,956				178				—				—				62,956				178
Asset-backed and other amortizing securities			—				—				12,700				850				12,700				850
Other securities			—				—				—				—				—				—
		$	71,242			$	313			$	459,349			$	71,235			$	530,591			$	71,548
December 31, 2025
State and municipal		$	205			$	—			$	165,618			$	23,500			$	165,823			$	23,500
Residential mortgage-backed securities			3,132				48				249,710				42,033				252,842				42,081
Commercial mortgage-backed securities			3,503				7				41,284				3,976				44,787				3,983
Commercial collateralized mortgage obligations			63,210				188				—				—				63,210				188
Asset-backed and other amortizing securities			—				—				13,132				840				13,132				840
Other securities			—				—				4,961				40				4,961				40
		$	70,050			$	243			$	474,705			$	70,389			$	544,755			$	70,632

There were 128 securities with an unrealized loss at March 31, 2026, generally due to a continuation of the elevated market interest rate environment. Management evaluates securities available for sale (“AFS”) in unrealized loss positions to determine whether the impairment is due to credit-related factors or non-credit related factors. Consideration is given to the extent to which the fair value is less than cost, the financial condition and near-term prospects of the issuer, and the intent and ability of the Company to retain its investment in the security for a period of time sufficient to allow for the anticipated recovery in fair value. Management does not have the intent to sell any of the securities in an unrealized loss position and believes that it is not likely that the securities will have to be sold before a recovery of cost. The fair value of these securities is expected to recover as the securities approach their maturity date or repricing date or if market yields for such investments decline. Accordingly, as of March 31, 2026, management believes the unrealized loss positions detailed in the previous table are due to non-credit related factors, including changes in interest rates and other market conditions, and therefore no ACL for AFS securities or losses have been recognized or realized in the consolidated financial statements.

4. LOANS HELD FOR INVESTMENT

Loans held for investment are summarized by category as of the dates presented below (dollars in thousands):

		March 31, 2026				December 31, 2025
Commercial real estate		$	1,052,951			$	1,064,625
Commercial - specialized			384,861				409,351
Commercial - general			654,634				659,323
Consumer:
1-4 family residential			589,026				589,851
Auto loans			256,056				259,157
Other consumer			62,557				62,092
Construction			103,444				100,103
			3,103,529				3,144,502
Allowance for credit losses on loans			(44,822	)			(45,131	)
Loans, net		$	3,058,707			$	3,099,371

The Company has certain lending policies, underwriting standards, and procedures in place that are designed to maximize loan income with an acceptable level of risk. Management reviews and approves these policies, underwriting standards, and procedures on a regular basis and makes changes as appropriate. Management receives frequent reports related to loan originations, quality, concentrations, delinquencies, non-performing, and potential problem loans. Diversification in the loan portfolio is a means of managing risk associated with fluctuations in economic conditions, both by type of loan and geography.

Commercial Real Estate – Underwriting standards have been designed to determine whether the borrower possesses sound business ethics and practices, evaluate current and projected cash flows to determine the ability of the borrower to repay their obligations as agreed and ensure appropriate collateral is obtained to secure the loan. Commercial real estate loans are underwritten primarily based on projected cash flows for income-producing properties and collateral values for non-income-producing properties. The repayment of these loans is generally dependent on the successful operation of the property securing the loans or the sale or refinancing of the property. Real estate loans may be adversely affected by conditions in the real estate markets or in the general economy. The properties securing the Company’s real estate portfolio are diversified by type and geographic location. This diversity helps reduce the exposure to adverse economic events that affect any single market or industry.

Commercial – General and Specialized – Commercial loans are underwritten after evaluating and understanding the borrower’s ability to operate profitably. Underwriting standards have been designed to determine whether the borrower possesses sound business ethics and practices, evaluate current and projected cash flows to determine the ability of the borrower to repay their obligations, as agreed and ensure appropriate collateral is obtained to secure the loan. Commercial loans are primarily made based on the identified cash flows of the borrower and, secondarily, on the underlying collateral provided by the borrower. Most commercial loans are secured by the assets being financed or other business assets, such as real estate, accounts receivable, or inventory, and typically include personal guarantees. Owner-occupied real estate is included in commercial loans, as the repayment of these loans is generally dependent on the operations of the commercial borrower’s business rather than on income-producing properties or the sale of the properties. Commercial loans are grouped into two distinct sub-categories: specialized and general. Commercial related segments that are considered “specialized” include agricultural production and real estate loans, energy loans, and finance, investment, and insurance loans. Commercial related segments that contain a broader diversity of borrowers, sub-industries, or serviced industries are grouped into the “general category.” These include goods, services, restaurant & retail, construction, and other industries. Performance of these loans is subject to operating and cash flow results of the borrower, with risk in the volatility of operating results for particular industries.

Consumer – Loans to consumers include 1-4 family residential loans, auto loans, and other loans for recreational vehicles or other purposes. The Company utilizes a computer-based credit scoring analysis to supplement its policies and procedures in underwriting consumer loans. The Company’s loan policy addresses types of consumer loans that may be originated and the collateral, if secured, which must be perfected. The relatively smaller individual dollar amounts of consumer loans that are spread over numerous individual borrowers also minimizes the Company’s risk. The Company generally requires mortgage title insurance and hazard insurance on 1-4 family residential loans. All consumer loans are generally dependent on the risk characteristics of the borrower’s ability to repay the loan, a consideration of the debt to income ratio, employment and income stability, the loan-to-value ratio, and the age, condition and marketability of the collateral.

Construction – Loans for residential construction are for single-family properties to developers, builders, or end-users. These loans are underwritten based on estimates of costs and completed value of the project. Funds are advanced based on estimated percentage of completion for the project. Performance of these loans is affected by economic conditions as well as the ability to control costs of the projects.

The commercial real estate and construction categories comprise the Company’s nonowner-occupied real estate loans. Total nonowner-occupied real estate loans were $1.16 billion at March 31, 2026, and $1.16 billion at December 31, 2025.

The following table details the activity in the ACL for loans for the periods indicated (dollars in thousands). Allocation of a portion of the ACL to one category of loans does not preclude its availability to absorb losses in other categories.

		Beginning Balance				Provision for Credit Losses				Charge-offs				Recoveries				Ending Balance
For the three months ended March 31, 2026
Commercial real estate		$	15,214			$	(197	)		$	—			$	—			$	15,017
Commercial - specialized			5,231				91				—				29				5,351
Commercial - general			7,448				96				(176	)			16				7,384
Consumer:
1-4 family residential			11,103				(594	)			—				294				10,803
Auto loans			3,033				515				(281	)			31				3,298
Other consumer			1,150				129				(339	)			117				1,057
Construction			1,952				(40	)			—				—				1,912
		$	45,131			$	—			$	(796	)		$	487			$	44,822
For the three months ended March 31, 2025
Commercial real estate		$	15,973			$	(186	)		$	—			$	—			$	15,787
Commercial - specialized			4,640				(151	)			—				34				4,523
Commercial - general			6,874				(417	)			(74	)			20				6,403
Consumer:
1-4 family residential			9,677				395				—				7				10,079
Auto loans			3,015				337				(303	)			47				3,096
Other consumer			1,115				247				(313	)			58				1,107
Construction			1,943				25				—				5				1,973
		$	43,237			$	250			$	(690	)		$	171			$	42,968

During the three months ended March 31, 2026, and 2025 the Company recorded a provision for credit loss of $260 thousand and $420 thousand, respectively, which was comprised of a provision for credit losses on loans of $— and $250 thousand, respectively, and a provision for off-balance sheet credit exposures of $260 thousand, and $170 thousand, respectively.

The following table shows the Company’s amortized cost and related ACL for individually evaluated collateral dependent loans by class using the fair value of collateral loss estimation methodology of evaluating expected credit losses at the dates indicated (dollars in thousands).

		Equipment				Real Estate				Other				Total Loans Individually Evaluated				Total ACL for Individually Evaluated Loans
March 31, 2026
Commercial real estate		$	462			$	409			$	—			$	871			$	58
Commercial - specialized			289				255				—				544				23
Commercial - general			—				403				—				403				—
Consumer:
1-4 family residential			—				—				—				—				—
Auto loans			—				—				—				—				—
Other consumer			—				—				—				—				—
Construction			—				607				—				607				—
		$	751			$	1,674			$	—			$	2,425			$	81

December 31, 2025
Commercial real estate		$	462			$	941			$	—			$	1,403			$	112
Commercial - specialized			289				255				—				544				—
Commercial - general			1,086				2,869				—				3,955				275
Consumer:
1-4 family residential			—				—				—				—				—
Auto loans			—				—				—				—				—
Other consumer			—				—				—				—				—
Construction			—				—				—				—				—
		$	1,837			$	4,065			$	—			$	5,902			$	387

The table below provides an age analysis on accruing past-due loans and nonaccrual loans at the dates indicated (dollars in thousands):

		30-89 Days Past Due				90 Days or More Past Due				Nonaccrual				Nonaccrual with no ACL
March 31, 2026
Commercial real estate		$	834			$	178			$	995			$	54
Commercial - specialized			1,102				—				696				—
Commercial - general			1,705				41				533				403
Consumer:
1-4 Family residential			2,260				1,061				835				—
Auto loans			379				17				—				—
Other consumer			692				116				14				—
Construction			105				—				607				607
		$	7,077			$	1,413			$	3,680			$	1,064

December 31, 2025
Commercial real estate		$	2,241			$	206			$	1,402			$	54
Commercial - specialized			264				50				699				544
Commercial - general			1,173				31				4,108				—
Consumer:
1-4 Family residential			1,221				1,750				845				—
Auto loans			395				40				—				—
Other consumer			765				80				16				—
Construction			455				578				—				—
		$	6,514			$	2,735			$	7,070			$	598

Credit Quality Indicators

The Company grades its loans on a thirteen-point grading scale. These grades fit in one of the following categories: (i) pass, (ii) special mention, (iii) substandard, (iv) doubtful, or (v) loss. Loans categorized as loss are charged-off immediately. The grading of loans reflects a judgment by the Company about the risks of default associated with the loan. The Company reviews the grades on loans as part of the Company’s on-going monitoring of the credit quality of the loan portfolio. These risk ratings are assigned based on relevant information about the ability of the borrowers to service their debt such as: current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors.

Pass loans have financial factors or nature of collateral that are considered reasonable credit risks in the normal course of lending and encompass several grades that are assigned based on varying levels of risk, ranging from credits that are secured by cash or marketable securities, to watch credits which have all the characteristics of an acceptable credit risk but warrant more than the normal level of monitoring.

Special mention loans have potential weaknesses that deserve management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of repayment prospects for the loans at some future date.

Substandard loans are inadequately protected by the current net worth and paying capacity of the borrower or by the collateral pledged, if any. These loans have a well-defined weakness or weaknesses that jeopardize collection and present the distinct possibility that some loss will be sustained if the deficiencies are not corrected. A protracted workout on these credits is a distinct possibility. Prompt corrective action is therefore required to strengthen the Company’s position, and/or to reduce exposure and to assure that adequate remedial measures are taken by the borrower. Credit exposure becomes more likely in such credits and a serious evaluation of the secondary support to the credit is performed. Substandard loans can be accruing or can be nonaccrual depending on the circumstances of the individual loans.

Doubtful loans have all the weaknesses inherent in substandard loans with the added characteristics that the weaknesses make collection or liquidation in full on the basis of currently existing facts, conditions, and values highly questionable and improbable. All doubtful loans are on nonaccrual.

In connection with the review of the Company’s loan portfolio, management considers risk elements attributable to particular loan type or categories in assessing the quality of individual loans. The list of loans to be analyzed for individual evaluation consists of non-accrual loans over $250 thousand. Interest income recognized using a cash-basis method on non-accrual loans for each of the three months ended March 31, 2026 and 2025 was not significant. In addition, the Company closely monitors substandard accruing loans over $1 million, and past due accruing loans over $250 thousand for possible individual evaluation. All other loans will be evaluated collectively in designated pools unless a loss exposure has been identified. Additional funds committed to be advanced on individually analyzed loans are not significant.

The following tables reflect the amortized cost basis in loans held for investment by credit quality indicator and origination year at the dates indicated, and related year-to-date gross charge-offs. Loans acquired are shown in the table by origination year. The Company had an immaterial amount of revolving loans converted to term loans at March 31, 2026 and December 31, 2025.

														Term Loans
										Amortized Cost Basis by Origination Year
(Dollars in thousands)		March 31, 2026
		2026				2025				2024				2023				2022				Prior				Revolving Loans				Total
Commercial real estate
Pass		$	50,472			$	204,540			$	130,334			$	158,649			$	238,482			$	223,454			$	11,831			$	1,017,762
Special mention			—				—				—				9,792				3,928				528				483				14,731
Substandard			—				890				349				4,254				1,900				13,065				—				20,458
Total commercial real estate loans		$	50,472			$	205,430			$	130,683			$	172,695			$	244,310			$	237,047			$	12,314			$	1,052,951
Year-to-date gross charge-offs		$	—			$	—			$	—			$	—			$	—			$	—			$	—			$	—
Commercial - specialized
Pass		$	26,221			$	78,513			$	38,613			$	35,601			$	22,506			$	55,214			$	115,718			$	372,386
Special mention			2,443				163				2,327				—				—				1,680				2,002				8,615
Substandard			—				—				822				486				1,782				770				—				3,860
Total commercial - specialized loans		$	28,664			$	78,676			$	41,762			$	36,087			$	24,288			$	57,664			$	117,720			$	384,861
Year-to-date gross charge-offs		$	—			$	—			$	—			$	—			$	—			$	—			$	—			$	—
Commercial - general
Pass		$	31,099			$	179,303			$	100,892			$	49,629			$	78,507			$	115,625			$	79,603			$	634,658
Special mention			—				24				446				10,597				44				1,465				1,925				14,501
Substandard			126				117				731				1,595				335				2,329				242				5,475
Total commercial - general loans		$	31,225			$	179,444			$	102,069			$	61,821			$	78,886			$	119,419			$	81,770			$	654,634
Year-to-date gross charge-offs		$	—			$	—			$	—			$	7			$	—			$	169			$	—			$	176
Consumer 1-4 family residential
Pass		$	23,196			$	92,579			$	67,377			$	87,299			$	125,808			$	167,857			$	7,184			$	571,300
Special mention			—				—				—				552				210				5,037				—				5,799
Substandard			—				214				3,167				2,143				902				5,501				—				11,927
Total consumer 1-4 family residential loans		$	23,196			$	92,793			$	70,544			$	89,994			$	126,920			$	178,395			$	7,184			$	589,026
Year-to-date gross charge-offs		$	—			$	—			$	—			$	—			$	—			$	—			$	—			$	—
Consumer auto loans
Pass		$	26,273			$	106,414			$	43,498			$	36,645			$	33,254			$	9,633			$	—			$	255,717
Special mention			—				—				—				—				—				—				—				—
Substandard			—				3				40				74				142				80				—				339
Total consumer auto loans		$	26,273			$	106,417			$	43,538			$	36,719			$	33,396			$	9,713			$	—			$	256,056
Year-to-date gross charge-offs		$	—			$	38			$	10			$	6			$	191			$	36			$	—			$	281
Consumer other consumer
Pass		$	9,618			$	23,858			$	10,793			$	5,524			$	5,664			$	5,474			$	1,539			$	62,470
Special mention			—				—				—				—				—				—				—				—
Substandard			—				23				12				—				13				39				—				87
Total consumer other consumer loans		$	9,618			$	23,881			$	10,805			$	5,524			$	5,677			$	5,513			$	1,539			$	62,557
Year-to-date gross charge-offs (1)		$	94			$	171			$	17			$	—			$	3			$	54			$	—			$	339
Construction
Pass		$	9,005			$	73,960			$	17,902			$	1,130			$	311			$	—			$	—			$	102,308
Special mention			—				—				—				—				—				—				—				—
Substandard			—				—				—				1,136				—				—				—				1,136
Total construction loans		$	9,005			$	73,960			$	17,902			$	2,266			$	311			$	—			$	—			$	103,444
Year-to-date gross charge-offs		$	—			$	—			$	—			$	—			$	—			$	—			$	—			$	—

⁽¹⁾ Includes $94 thousand in charged-off demand deposit overdrafts reported as 2026 originations.

														Term Loans
(Dollars in thousands)		Amortized Cost Basis by Origination Year
		December 31, 2025
		2025				2024				2023				2022				2021				Prior				Revolving Loans				Total
Commercial real estate
Pass		$	209,948			$	137,602			$	195,747			$	245,012			$	95,319			$	143,422			$	5,372			$	1,032,422
Special mention			—				2,825				7,343				81				166				1,095				483				11,993
Substandard			360				62				5,101				1,613				7,095				5,979				—				20,210
Total commercial real estate loans		$	210,308			$	140,489			$	208,191			$	246,706			$	102,580			$	150,496			$	5,855			$	1,064,625
Year-to-date gross charge-offs		$	—			$	—			$	541			$	—			$	—			$	—			$	—			$	541
Commercial - specialized
Pass		$	122,003			$	35,559			$	38,159			$	24,081			$	32,943			$	29,452			$	103,491			$	385,688
Special mention			4,572				8,076				799				1,042				1,734				830				3,770				20,823
Substandard			—				194				570				811				1,206				59				—				2,840
Total commercial - specialized loans		$	126,575			$	43,829			$	39,528			$	25,934			$	35,883			$	30,341			$	107,261			$	409,351
Year-to-date gross charge-offs		$	—			$	—			$	—			$	—			$	—			$	—			$	—			$	—
Commercial - general
Pass		$	178,827			$	103,310			$	51,335			$	84,327			$	43,179			$	79,605			$	92,158			$	632,741
Special mention			60				2,110				12,127				—				1,011				473				—				15,781
Substandard			40				758				1,615				1,281				5,749				1,116				242				10,801
Total commercial - general loans		$	178,927			$	106,178			$	65,077			$	85,608			$	49,939			$	81,194			$	92,400			$	659,323
Year-to-date gross charge-offs		$	—			$	245			$	164			$	116			$	63			$	245			$	50			$	883
Consumer 1-4 family residential
Pass		$	95,677			$	69,844			$	92,148			$	137,702			$	77,474			$	96,393			$	4,010			$	573,248
Special mention			—				—				621				428				5,061				—				—				6,110
Substandard			214				3,095				1,573				1,067				604				3,940				—				10,493
Total consumer 1-4 family residential loans		$	95,891			$	72,939			$	94,342			$	139,197			$	83,139			$	100,333			$	4,010			$	589,851
Year-to-date gross charge-offs		$	—			$	—			$	31			$	—			$	215			$	61			$	—			$	307
Consumer auto loans
Pass		$	115,240			$	48,236			$	42,397			$	39,896			$	11,045			$	2,015			$	—			$	258,829
Special mention			—				—				—				—				—				—				—				—
Substandard			—				44				70				122				75				17				—				328
Total consumer auto loans		$	115,240			$	48,280			$	42,467			$	40,018			$	11,120			$	2,032			$	—			$	259,157
Year-to-date gross charge-offs		$	29			$	243			$	367			$	477			$	198			$	35			$	—			$	1,349
Consumer other consumer
Pass		$	27,912			$	12,521			$	6,704			$	7,014			$	2,223			$	4,096			$	1,534			$	62,004
Special mention			—				—				—				—				—				—				—				—
Substandard			16				13				—				16				10				33				—				88
Total consumer other consumer loans		$	27,928			$	12,534			$	6,704			$	7,030			$	2,233			$	4,129			$	1,534			$	62,092
Year-to-date gross charge-offs (1)		$	510			$	203			$	44			$	107			$	49			$	152			$	1			$	1,066
Construction
Pass		$	71,154			$	24,768			$	2,505			$	570			$	—			$	—			$	—			$	98,997
Special mention			—				—				—				—				—				—				—				—
Substandard			—				—				1,106				—				—				—				—				1,106
Total construction loans		$	71,154			$	24,768			$	3,611			$	570			$	—			$	—			$	—			$	100,103
Year-to-date gross charge-offs		$	—			$	—			$	—			$	—			$	—			$	—			$	—			$	—

⁽¹⁾ Includes $498 thousand in charged-off demand deposit overdrafts reported as 2025 originations.

Occasionally, the Company modifies loans to borrowers in financial distress by providing principal forgiveness, term extensions, an other than insignificant payment delay, or interest rate reduction. When principal forgiveness is provided, the amount of forgiveness is charged-off against the allowance for credit losses. Typically, one type of concession, such as term extension, is granted initially. If the borrower continues to experience financial difficulty, another concession, such as principal forgiveness, may be granted. In some cases, the Company provides multiple types of concessions on one loan.

The following table presents the amortized cost basis of loans at the dates indicated that were both experiencing financial difficulty and modified during each of the three months ended March 31, 2026 and 2025, by class and by type of modification. The percentage of the amortized cost basis of loans that were modified to borrowers in financial distress as compared to the amortized cost basis of each class of financing receivable is also presented below (dollars in thousands):

		Payment Delay				Term Extension				Rate Reduction				Term Extension and Payment Delay				Term Extension and Interest Rate Reduction				Payment Delay and Interest Rate Reduction				Payment Delay, Term Extension, and Interest Rate Reduction				% of Total Class of Financing Receivable
March 31, 2026
Commercial real estate		$	—			$	—			$	—			$	—			$	—			$	—			$	—				—
Commercial - specialized			545				—				—				50				—				—				—				0.15	%
Commercial - general			15				20				—				—				—				—				—				0.01	%
Consumer:
1-4 family			—				30				—				249				—				—				—				0.05	%
Auto loans			—				—				—				—				—				—				—				—
Other consumer			—				—				—				—				—				—				—				—
Construction			—				529				—				607				—				—				—				1.10	%
		$	560			$	579			$	—			$	906			$	—			$	—			$	—				0.07	%
March 31, 2025
Commercial real estate		$	—			$	—			$	—			$	—			$	—			$	—			$	—				—
Commercial - specialized			—				—				—				—				—				—				—				—
Commercial - general			—				270				—				43				—				—				—				0.05	%
Consumer:
1-4 family			—				—				—				—				—				—				—				—
Auto loans			—				—				—				—				—				—				—				—
Other consumer			—				—				—				—				—				—				—				—
Construction			—				—				—				—				—				—				—				—
		$	—			$	270			$	—			$	43			$	—			$	—			$	—				0.01	%

The following table presents the financial effects of the loan modifications presented above to borrowers experiencing financial difficulty for each of the three months ended March 31, 2026 and 2025 (dollars in thousands):

		Weighted- Average Interest Rate Reduction				Weighted- Average Term Extension (Months)
March 31, 2026
Commercial real estate			—				—
Commercial - specialized			—				4
Commercial - general			—				13
Consumer:
1-4 Family residential			—				45
Auto loans			—				—
Other consumer			—				—
Construction			—				8

March 31, 2025
Commercial real estate			—				—
Commercial - specialized			—				—
Commercial - general			—				36
Consumer:
1-4 Family residential			—				—
Auto loans			—				—
Other consumer			—				—
Construction			—				—

The Company closely monitors the performance of loans that are modified to borrowers experiencing financial difficulty to understand the effectiveness of its modification efforts. The following table presents the performance of such loans that have been modified in the last twelve months at the dates indicated (dollars in thousands):

		Current				30-89 Days Past Due				90 Days or More Past Due				Nonaccrual
March 31, 2026
Commercial real estate		$	—			$	—			$	—			$	124
Commercial - specialized			—				50				—				638
Commercial - general			694				50				—				423
Consumer:
1-4 Family residential			138				—				—				141
Auto loans			58				40				—				—
Other consumer			12				—				—				—
Construction			529				—				—				607
		$	1,431			$	140			$	—			$	1,933

March 31, 2025
Commercial real estate		$	90			$	46			$	—			$	336
Commercial - specialized			—				—				—				12
Commercial - general			607				—				—				172
Consumer:
1-4 Family residential			1,025				238				60				—
Auto loans			—				—				—				—
Other consumer			—				—				—				—
Construction			—				—				—				141
		$	1,722			$	284			$	60			$	661

On an ongoing basis, the performance of modified loans is monitored for subsequent payment default. Payment default is defined as movement to nonperforming status, foreclosure, or charge-off. During the three months ended March 31, 2026, the Company had three loans made to borrowers experiencing financial difficulty totaling $577 thousand that were modified during the last twelve months that subsequently defaulted. During the three months ended March 31, 2025, the Company had three loans made to borrowers experiencing financial difficulty totaling $141 thousand that were modified during the last twelve months that subsequently defaulted.

Upon the Company’s determination that a modified loan has subsequently been deemed to not be fully collectible, the uncollectible amount is written off. Therefore, the amortized cost basis of the loan is reduced by the uncollectible amount and the allowance for credit losses is adjusted by the same amount.

5. GOODWILL AND INTANGIBLES

The Company had goodwill of $19.3 million at March 31, 2026 and December 31, 2025.

Other intangible assets, which consisted of core deposit intangibles at the dates indicated are summarized below (dollars in thousands):

		March 31, 2026				December 31, 2025
Amortized intangible assets:
Core deposit intangible		$	6,679			$	6,679
Less: Accumulated amortization			(5,667	)			(5,546	)
Other intangible assets, net		$	1,012			$	1,133

6. MORTGAGE SERVICING RIGHTS

The following table reflects the changes in fair value of the Company’s mortgage servicing rights asset included in the Consolidated Balance Sheets, and other information related to the serviced portfolio, for the periods or dates presented (dollars in thousands):

		Three Months Ended March 31,
		2026				2025
Beginning balance		$	24,041			$	26,292
Additions			320				199
Valuation adjustment			250				(1,585	)
Ending balance		$	24,611			$	24,906

		March 31, 2026				December 31, 2025
Mortgage loans serviced for others		$	1,792,545			$	1,810,579
Mortgage servicing rights assets as a percentage of serviced mortgage loans			1.37	%			1.33	%

The following table reflects the key assumptions used in measuring the fair value of the Company’s mortgage servicing rights as of the dates indicated:

		March 31, 2026				December 31, 2025
Weighted average constant prepayment rate			7.27	%			8.81	%
Weighted average discount rate			9.71	%			9.70	%
Weighted average life in years			7.80				7.43

7. BORROWING ARRANGEMENTS

Subordinated Debt

In December 2018, the Company issued $14.1 million of subordinated notes that have a maturity date of December 2030 and a weighted average fixed rate of 6.41% for the first seven years. After the fixed rate period, these notes will float at the Wall Street Journal prime rate, with a floor of 4.0% and a ceiling of 7.5%. These notes pay interest quarterly, are unsecured, and may be called by the Company at any time after the remaining maturity is five years or less. Additionally, these notes are intended to qualify for Tier 2 capital treatment, subject to regulatory limitations.

As of March 31, 2026 and December 31, 2025, the total amount of subordinated notes outstanding was $14.1 million.

Notes Payable and Other Borrowings

As of March 31, 2026 and December 31, 2025, City Bank had no outstanding advances from the Federal Home Loan Bank of Dallas (“FHLB”) or any short-term borrowings.

8. STOCK-BASED COMPENSATION

Equity Incentive Plan

The 2019 Equity Incentive Plan (“Plan”) was approved by the Company’s Board of Directors on January 16, 2019 and by its shareholders on March 6, 2019. The purpose of the Plan is to: (i) attract and retain the best available personnel for positions of substantial responsibility, (ii) provide additional incentive to employees, directors and consultants, and (iii) promote the success of the Company’s business. This Plan permits the grant of incentive stock options, non-statutory stock options, stock appreciation rights, restricted stock, restricted stock units, performance units, performance shares, and other stock-based awards. The maximum aggregate number of shares of common stock that may be issued pursuant to all awards under the Plan was 5,901,991 at March 31, 2026. The maximum aggregate number of shares that may be issued under the Plan may be increased annually by up to 3% of the total issued and outstanding common shares of the Company at the beginning of each fiscal year.

The fair value of each option award is estimated on the date of grant using the Black-Scholes model that uses the assumptions noted in the table below. Expected volatilities are based on historical volatilities of the Company’s common stock and similar peer company averages. The Company uses historical data to estimate option exercise and post-vesting termination behavior. The expected term of options granted represents the period of time that options granted are expected to be outstanding, which takes in to account that the options are not transferable. The risk-free interest rate for the expected term of the option is based on the U.S. Treasury yield curve in effect at the time of the grant.

Options

A summary of activity in the Plan during the period indicated is presented in the table below (dollars in thousands, except per share data):

		Number of Shares				Weighted-Average Exercise Price				Weighted-Average Remaining Contractual Life in Years				Aggregate Intrinsic Value
Three Months Ended March 31, 2026
Outstanding at beginning of year:			1,076,673			$	18.92
Granted			28,675				38.92
Exercised			—				—
Forfeited			—				—
Expired			—				—
Balance at end of period			1,105,348			$	19.44				3.95			$	24,829
Exercisable at end of period			1,030,024			$	18.37				3.60			$	24,237
Vested at end of period			1,030,024			$	18.37				3.60			$	24,237

A summary of assumptions used to calculate the fair values of the awards granted during the periods noted is presented below:

		Three Months Ended March 31,
		2026				2025
Expected volatility			39.61	%			41.21	%
Expected dividend yield			1.80	%			1.80	%
Expected term (years)			6.1				6.1
Risk-free interest rate			3.85	%			4.43	%
Weighted average grant date fair value		$	14.44			$	13.35

The total intrinsic value of options exercised during the three months ended March 31, 2026 and 2025 was $— and $459 thousand, respectively.

Restricted Stock Awards and Units

A summary of activity in the Plan during the period indicated is presented in the table below:

		Number of Shares				Weighted-Average Grant Date Fair Value
Three Months Ended March 31, 2026
Outstanding at beginning of year:			241,035			$	28.60
Granted			60,972				41.23
Released			(57,194	)			29.86
Forfeited			(701	)			23.67
Balance at end of period			244,112			$	31.48
Nonvested at end of period			152,366			$	34.31
Vested unreleased at end of period			91,746			$	26.78

Restricted stock units granted under the Plan typically vest from one to four years, but vesting periods may vary. Compensation expense for these grants will be recognized over the vesting period of the awards based on the fair value of the stock at the issue date. The total fair value of restricted stock units released during each of the three months ended March 31, 2026 and 2025 was $1.7 million and $443 thousand, respectively.

For the three months ended March 31, 2026 and 2025, the Company recorded stock-based compensation expense related to the Plan of $627 thousand and $536 thousand, respectively.

The total unrecognized compensation cost for the awards outstanding under the Plan at March 31, 2026 was $5.9 million and will be recognized over a weighted average remaining period of 1.85 years.

Employee Stock Purchase Plan – The Company maintains the South Plains Financial, Inc. 2023 Employee Stock Purchase Plan (the “ESPP”) offering eligible employees an opportunity to purchase shares of Company common stock at a 15% discount from the lesser of fair market value on the first or last day of each six-month offering period, beginning August 1, 2024. The ESPP provides for the purchase of up to an aggregate of one million shares of the Company’s common stock by the employees. A maximum of 1,200 shares per employee may be purchased per offering period. The ESPP benefit is treated as compensation to the employee, and the compensation expense will be recognized over the service period based on the grant date fair value of the rights determined at the beginning of the purchase period, adjusted for forfeitures and certain modifications. Stock-based compensation expense related to the ESPP was $41 thousand and $33 thousand for the three months ended March 31, 2026 and 2025, respectively. At March 31, 2026, there was $45 thousand of total unrecognized compensation expense related to estimated ESPP shares. These costs are expected to be recognized over a period of four months. As of March 31, 2026, 24,377 shares were issued under the ESPP.

A summary of assumptions used to calculate the grant date fair value of the ESPP rights for the periods indicated is presented below:

		Three Months Ended March 31,
		2026				2025
Expected volatility		26.35% to 29.24%				31.31% to 36.08%
Expected dividend yield		1.59% to 1.78%				1.70% to 1.89%
Expected term (years)			0.5				0.5
Risk-free interest rate		3.59% to 4.12%				4.24% to 5.02%

9. OFF-BALANCE-SHEET ACTIVITIES, COMMITMENTS AND CONTINGENCIES

Financial instruments with off-balance-sheet risk - The Company is a party to financial instruments with off-balance-sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments include commitments to extend credit and standby letters of credit. Such commitments involve, to varying degrees, elements of credit and interest rate risk in excess of the amount recognized in the Company’s consolidated financial statements. The Company’s exposure to credit loss is represented by the contractual amount of these commitments. The Company follows the same credit policies in making commitments as it does for recorded instruments.

Financial instruments whose contract amounts represent credit risk outstanding at the dates indicated follow (dollars in thousands):

		March 31, 2026				December 31, 2025
Commitments to grant loans and unfunded commitments under lines of credit		$	627,886			$	554,286
Standby letters of credit			29,791				30,681

Commitments to grant loans and extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. The commitments for lines of credit may expire without being drawn upon. Therefore, the total commitment amounts do not necessarily represent future cash requirements. The amount of collateral obtained, if it is deemed necessary by the Company, is based on management’s credit evaluation of the customer.

Standby letters of credit are conditional commitments issued by the Company to guarantee the performance of a customer to a third party. Those letters of credit are primarily issued to support public and private borrowing arrangements. Essentially all letters of credit issued have expiration dates within one year. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan facilities to customers. The Company requires collateral supporting those commitments if deemed necessary.

FHLB Letters of Credit - The Company may use FHLB letters of credit to pledge to certain public deposits. At March 31, 2026 and December 31, 2025 there were no FHLB letters of credit outstanding.

Litigation – The Company is a defendant in legal actions arising from time to time in the normal course of business. Management believes that the ultimate liability, if any, arising from these matters will not materially affect the consolidated financial statements, based on information known as of the date the consolidated financial statements were available to be issued.

10. CAPITAL AND REGULATORY MATTERS

The Company and its bank subsidiary are subject to various regulatory capital requirements administered by its banking regulators. Failure to meet minimum capital requirements can initiate certain mandatory and possibly additional discretionary actions by regulators that, if undertaken, could have a direct material effect on the Company’s and its bank subsidiary’s financial statements. Under capital guidelines and the regulatory framework for prompt corrective action, the Company and its bank subsidiary must meet specific capital guidelines that involve quantitative measures of their assets, liabilities, and certain off-balance-sheet items as calculated under regulatory accounting practices. The capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings, and other factors. Prompt corrective action provisions are not applicable to bank holding companies.

Quantitative measures established by regulation to ensure capital adequacy require the Company and its bank subsidiary to maintain minimum amounts and ratios (set forth in the following table) of total and Tier 1 capital (as defined in the regulations) to risk-weighted assets (as defined) and of Tier 1 capital (as defined) to average assets (as defined). Management believes, as of March 31, 2026 and December 31, 2025, that the Company and its bank subsidiary met all capital adequacy requirements to which they are subject.

As of March 31, 2026 and December 31, 2025, the Company met the definition of “well-capitalized” under the applicable regulations of the Board of Governors of the Federal Reserve System and the bank subsidiary was “well capitalized” under the FDIC’s regulatory framework for prompt corrective action and the Basel III capital guidelines. To be categorized as well capitalized, an institution must maintain minimum total risk-based, Tier 1 risk-based and Tier 1 leverage ratios as set forth in the following tables. There are no conditions or events since March 31, 2026 that management believes have changed the bank subsidiary’s category.

The Company and its bank subsidiary’s actual capital amounts and ratios at the dates indicated follows (dollars in thousands):

		Actual								Minimum Required Under BASEL III								To Be Well Capitalized Under Prompt Corrective Action Provisions
		Amount				Ratio				Amount				Ratio				Amount				Ratio
March 31, 2026
Total Capital to Risk Weighted Assets:
Consolidated		$	634,568				17.61	%		$	378,314				10.50	%			N/A				N/A
City Bank			541,696				15.04	%			378,180				10.50	%		$	360,171				10.00	%
Tier 1 Capital to Risk Weighted Assets:
Consolidated			578,230				16.05	%			306,254				8.50	%			N/A				N/A
City Bank			496,654				13.79	%			306,146				8.50	%			288,137				8.00	%
Common Equity Tier 1 to Risk Weighted Assets:
Consolidated			533,230				14.80	%			252,209				7.00	%			N/A				N/A
City Bank			496,654				13.79	%			252,120				7.00	%			234,111				6.50	%
Tier 1 Capital to Average Assets:
Consolidated			578,230				12.68	%			183,243				4.00	%			N/A				N/A
City Bank			496,654				10.90	%			183,154				4.00	%			227,926				5.00	%
December 31, 2025
Total Capital to Risk Weighted Assets:
Consolidated		$	622,485				17.26	%		$	378,645				10.50	%			N/A				N/A
City Bank			537,444				14.91	%			378,576				10.50	%		$	360,549				10.00	%
Tier 1 Capital to Risk Weighted Assets:
Consolidated			566,107				15.70	%			306,522				8.50	%			N/A				N/A
City Bank			492,355				13.66	%			306,466				8.50	%			288,439				8.00	%
Common Equity Tier 1 to Risk Weighted Assets:
Consolidated			521,107				14.45	%			252,430				7.00	%			N/A				N/A
City Bank			492,355				13.66	%			252,384				7.00	%			234,357				6.50	%
Tier 1 Capital to Average Assets:
Consolidated			566,107				12.53	%			181,591				4.00	%			N/A				N/A
City Bank			492,355				10.90	%			181,512				4.00	%			225,868				5.00	%

The Company is subject to the Basel III capital ratio requirements which include a “capital conservation buffer” of 2.50% above the regulatory minimum risk-based capital adequacy requirements. This 2.50% capital conservation buffer is reflected in the table above. Both the Company’s and the Bank’s actual ratios, as outlined in the table above, exceeded the Basel III risk-based capital requirement with the capital conservation buffer as of March 31, 2026.

State banking regulations place certain restrictions on dividends paid by banks to their shareholders. Dividends paid by the Company’s bank subsidiary would be prohibited if the effect thereof would cause the bank subsidiary’s capital to be reduced below applicable minimum capital requirements.

11. DERIVATIVES

The Company utilizes interest rate swap agreements as part of its asset-liability management strategy to help manage its interest rate risk position. These interest rate swaps are designated and qualify as fair value hedges and are entered into to reduce exposure to changes in fair value of fixed rate financial instruments. The notional amounts of the interest rate swaps do not represent amounts exchanged by the parties. The amount exchanged is determined by reference to the notional amounts and the other terms of the individual interest rate swap agreements.

The following table reflects the changes in fair value hedges included in the Consolidated Statements of Comprehensive Income for the periods indicated (dollars in thousands):

				Three Months Ended
				March 31,
Interest Rate Contracts		Location		2026				2025
Change in fair value of interest rate swaps hedging investment securities		Other noninterest expense		$	(64	)		$	(2,436	)
Change in fair value of hedged investment securities		Other noninterest expense			26				2,252
Change in fair value of interest rate swaps hedging fixed rate loans		Interest income - loans			—				(59	)
Change in fair value of hedged fixed rate loans		Interest income - loans			—				71

The following table reflects the fair value hedges included in the Consolidated Balance Sheets at the dates indicated (dollars in thousands):

		March 31, 2026								December 31, 2025
		Notional Amount				Fair Value				Notional Amount				Fair Value
Included in other liabilities:
Interest rate swaps related to fixed rate loans		$	—			$	—			$	—			$	—
Interest rate swaps related to state and municipal securities			—				—				—				—
Included in other assets:
Interest rate swaps related to fixed rate loans		$	2,006			$	24			$	2,030			$	24
Interest rate swaps related to state and municipal securities			116,810				9,666				117,860				9,730

Mortgage banking derivatives

The net gains (losses) relating to free standing derivative instruments used for risk management are summarized below for the periods indicated (dollars in thousands):

				Three Months Ended
				March 31,
		Location		2026				2025
Gain (loss) on mortgage banking derivatives		Net gain on sales of loans		$	192			$	83

The following table reflects the amount and fair value of mortgage banking derivatives in the Consolidated Balance Sheets at the dates indicated (dollars in thousands):

		March 31, 2026								December 31, 2025
		Notional Amount				Fair Value				Notional Amount				Fair Value
Included in other assets:
Forward contracts related to mortgage loans held for sale		$	18,125			$	67			$	—			$	—
Interest rate lock commitments			24,856				403				16,127				216
Included in other liabilities:
Forward contracts related to mortgage loans held for sale		$	4,641			$	127			$	15,746			$	65

The Company had received cash collateral of $9.3 million and $10.5 million to offset asset derivative positions on its interest rate swaps at March 31, 2026 and December 31, 2025, respectively. This amount is reported in other liabilities in the Consolidated Balance Sheets. The Company had advanced $1.1 million to offset liability derivative positions on its interest rate swaps at March 31, 2026 and December 31, 2025. Additionally, the Company had advanced $270 thousand on its mortgage forward contracts at March 31, 2026 and December 31, 2025. The advanced cash collateral amounts are reported in cash and due from banks in the Consolidated Balance Sheets.

12. EARNINGS PER SHARE

The factors used in the earnings per share computation for the periods indicated follow (dollars in thousands, except per share data):

		Three Months Ended March 31,
		2026				2025
Net income		$	14,545			$	12,294
Weighted average common shares outstanding - basic			16,318,570				16,415,862
Effect of dilutive securities:
Stock-based compensation awards			717,764				649,737
Weighted average common shares outstanding - diluted			17,036,334				17,065,599
Basic earnings per share		$	0.89			$	0.75
Diluted earnings per share		$	0.85			$	0.72

13. SEGMENT INFORMATION

Operating segments are components of a business about which separate financial information is available that is evaluated regularly by the chief operating decision-maker (“CODM”) in deciding how to allocate resources and in assessing performance.

The Company’s reportable banking segment is determined by its President, who is the designated CODM. City Bank is the only significant subsidiary upon which the CODM makes decisions regarding how to allocate resources and assess performance. Individual bank branches offer a group of similar services, including commercial, real estate and consumer loans, time deposits, checking and savings accounts, all with similar operating and economic characteristics. While the CODM monitors the revenue streams of the various products, services, and branch locations, operations are managed and financial performance is evaluated on a Company-wide basis. Accordingly, all of the community banking services and branch locations are considered by management to be aggregated into one reportable operating segment, banking. Loans, investments, and deposits provide the significant revenues and interest expense, provision for credit losses and salaries and employee benefits comprise the significant expenses within the banking segment. All significant revenues and expenses mentioned above are shown individually on the Consolidated Statements of Comprehensive Income.

14. FAIR VALUE DISCLOSURES

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. A fair value measurement assumes that the transaction to sell the asset or transfer the liability occurs in the principal market for the asset or liability or, in the absence of a principal market, the most advantageous market for the asset or liability. The price in the principal (or most advantageous) market used to measure the fair value of the asset or liability is not adjusted for transaction costs. An orderly transaction is a transaction that assumes exposure to the market for a period prior to the measurement date to allow for marketing activities that are usual and customary for transactions involving such assets and liabilities; it is not a forced transaction. Market participants are buyers and sellers in the principal market that are: (i) independent, (ii) knowledgeable, (iii) able to transact and (iv) willing to transact.

Valuation techniques that are consistent with the market approach, the income approach and/or the cost approach are required by GAAP. The market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets and liabilities. The income approach uses valuation techniques to convert future amounts, such as cash flows or earnings, to a single present amount on a discounted basis. The cost approach is based on the amount that currently would be required to replace the service capacity of an asset. Valuation techniques should be consistently applied. Inputs to valuation techniques refer to the assumptions that market participants would use in pricing the asset or liability. Inputs may be observable, meaning those that reflect the assumptions market participants would use in pricing the asset or liability developed based on market data obtained from independent sources, or unobservable, meaning those that reflect the reporting entity’s own assumptions about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The fair value hierarchy for valuation inputs gives the highest priority to quoted prices in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The fair value hierarchy is as follows:

●

Level 1 Inputs - Unadjusted quoted prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date.

●

Level 2 Inputs - Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These might include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (such as interest rates, volatilities, prepayment speeds, credit risks, etc.) or inputs that are derived principally from or corroborated by market data by correlation or other means.

●

Level 3 Inputs - Significant unobservable inputs for determining the fair values of assets or liabilities that reflect an entity’s own assumptions about the assumptions that market participants would use in pricing the assets or liabilities.

The following table summarizes fair value measurements as of the dates indicated below (dollars in thousands):

		Level 1				Level 2				Level 3				Total
March 31, 2026
Assets (liabilities) measured at fair value on a recurring basis:
Securities available for sale:
U.S government and agencies		$	—			$	49,990			$	—			$	49,990
State and municipal			—				173,197				—				173,197
Residential mortgage-backed securities			—				254,065				—				254,065
Commercial mortgage-backed securities			—				45,833				—				45,833
Commercial collateralized mortgage obligations			—				67,067				—				67,067
Asset-backed and other amortizing securities			—				12,700				—				12,700
Other securities			—				—				—				—
Loans held for sale (mandatory)			—				15,471				—				15,471
Mortgage servicing rights			—				—				24,611				24,611
Asset derivatives			—				10,160				—				10,160
Liability derivatives			—				(127	)			—				(127	)
Assets measured at fair value on a non-recurring basis:
Loans held for investment			—				—				2,344				2,344
December 31, 2025
Assets (liabilities) measured at fair value on a recurring basis:
Securities available for sale:
State and municipal		$	—			$	176,305			$	—			$	176,305
Residential mortgage-backed securities			—				260,760				—				260,760
Commercial mortgage-backed securities			—				44,786				—				44,786
Commercial collateralized mortgage obligations			—				67,597				—				67,597
Asset-backed and other amortizing securities			—				13,132				—				13,132
Other securities			—				4,960				—				4,960
Loans held for sale (mandatory)			—				7,796				—				7,796
Mortgage servicing rights			—				—				24,041				24,041
Asset derivatives			—				9,970				—				9,970
Liability derivatives			—				(65	)			—				(65	)
Assets measured at fair value on a non-recurring basis:
Loans held for investment			—				—				5,515				5,515

Securities – Fair value is calculated based on market prices of similar securities using matrix pricing. Matrix pricing is a mathematical technique commonly used to price debt securities that are not actively traded.

Mortgage servicing rights – Mortgage servicing rights are reported at fair value using Level 3 inputs. The mortgage servicing rights asset is valued by projecting net servicing cash flows, which are then discounted to estimate the fair value. The fair value of the mortgage servicing rights asset is impacted by a variety of factors, including prepayment speeds, default rates, and discount rates, which are significant unobservable inputs. Mortgage servicing rights are the only Level 3 asset measured at fair value on a recurring basis, see Note 6 for the Level 3 change activity for each of the three months ended March 31, 2026 and 2025.

Derivatives – Fair value of derivatives is based on valuation models using observable market data as of the measurement date.

Loans held for investment – Includes certain collateral-dependent loans which are reported at fair value, for which a specific allocation of the allowance for credit losses is based off of the underlying collateral, less estimated disposal costs, if repayment is expected solely from the sale of the collateral. Collateral values are estimated using Level 2 inputs based on observable market data or Level 3 inputs based on customized discounting criteria.

Fair Values of Assets Recorded on a Recurring Basis for which the Fair Value Option has been Elected

Loans held for sale (mandatory) – Loans held for sale originated for mandatory delivery are reported at fair value on a recurring basis due to the Company’s election to adopt fair value accounting treatment for these assets. This election allows for a more effective offset of the changes in fair values of the assets and the derivative instruments used to economically hedge them without the burden of complying with the requirements for hedge accounting under ASC Topic 815, Derivatives and Hedging. For assets for which the fair value option has been elected, the earned current contractual interest payment is recognized in interest income, loan origination costs and fees on fair value option loans are recognized in earnings as incurred and not deferred. At March 31, 2026, and December 31, 2025, there were no gains or losses recorded attributable to changes in instrument-specific credit risk. Fair value is determined using quoted prices for similar assets, adjusted for specific attributes of that loan. At March 31, 2026 and December 31, 2025, the aggregate fair value of loans held for sale for mandatory delivery was $15.5 million and $7.8 million, respectively. The aggregate unpaid principal balance as of the same dates was $15.3 million and $7.6 million, respectively, representing differences between fair value and unpaid principal balance of $194 thousand and $152 thousand, respectively. The Company had no loans held for sale for mandatory delivery designated as nonaccrual or 90 days or more past due at each of March 31, 2026 and December 31, 2025.

The total fair value option impact on noninterest income for loans held for sale for mandatory delivery is included in Net gain on sales of loans in the Consolidated Statements of Comprehensive Income. For each of the three months ended March 31, 2026 and 2025, the net (gain) loss amount totaled $(233) thousand and $(88) thousand, respectively.

The following table presents quantitative information about recurring and non-recurring Level 3 fair value measurements at the dates indicated (dollars in thousands):

		Fair Value			Valuation Techniques		Unobservable Inputs		Range of Discounts
March 31, 2026
Non-recurring:
Loans held for investment		$	2,344		Third party appraisals or inspections		Collateral discounts and selling costs		20% to 35%
Recurring:
Mortgage servicing rights			24,611		Discounted cash flows		Constant prepayment rate			7.27%
							Discount rate			9.71%
December 31, 2025
Non-recurring:
Loans held for investment		$	5,515		Third party appraisals or inspections		Collateral discounts and selling costs		20% to 60%
Recurring:
Mortgage servicing rights			24,041		Discounted cash flows		Constant prepayment rate			8.81%
							Discount rate			9.70%

The estimated fair values, and related carrying amounts, of the Company’s financial instruments that are not previously disclosed in the recurring fair values section are as follows (dollars in thousands):

		Carrying Amount				Level 1				Level 2				Level 3				Total Fair Value
March 31, 2026
Financial assets:
Cash and cash equivalents		$	722,000			$	722,000			$	—			$	—			$	722,000
Loans held for investment, net			3,058,707				—				—				3,040,850				3,040,850
Loans held for sale (best efforts)			1,732				—				1,757				—				1,757
Accrued interest receivable			17,009				—				17,009				—				17,009
Financial liabilities:
Deposits			4,027,586				—				4,027,579				—				4,027,579
Accrued interest payable			4,578				—				4,578				—				4,578
Junior subordinated deferrable interest debentures			46,393				—				35,169				—				35,169
Subordinated debt			14,100				—				13,246				—				13,246

December 31, 2025
Financial assets:
Cash and cash equivalents		$	552,439			$	552,439			$	—			$	—			$	552,439
Loans held for investment, net			3,099,371				—				—				3,082,072				3,082,072
Loans held for sale (best efforts)			2,197				—				2,237				—				2,237
Accrued interest receivable			20,931				—				20,931				—				20,931
Financial liabilities:
Deposits			3,874,077				—				3,873,806				—				3,873,806
Accrued interest payable			5,014				—				5,014				—				5,014
Junior subordinated deferrable interest debentures			46,393				—				35,213				—				35,213
Subordinated debt			14,100				—				13,907				—				13,907

15. SUBSEQUENT EVENTS

BOH Merger

On April 1, 2026, the Company acquired all of the outstanding common stock of BOH, a Texas corporation and the bank holding company for Bank of Houston, in a stock transaction. Pursuant to the Reorganization Agreement, shareholders of BOH received 0.1925 shares of the Company’s common stock in exchange for each share of BOH stock resulting in the Company issuing 2,803,535 shares of its common stock. In total, the purchase price for BOH was $118.1 million.

The Merger will be accounted for under ASC 805 as a business combination. The excess of the fair value of consideration transferred over total identifiable net assets will be recorded as goodwill. The initial accounting for the acquisition has not been completed because the information to measure the fair value of financial assets, financial liabilities and goodwill is not yet available. The Company expects to finalize the valuation and complete the purchase price allocation as soon as practicable, but no later than one year from the acquisition date. We will include the relevant disclosures as required in the second quarter of 2026. For more information see Note 2.

Dividend Declaration

On April 16, 2026, the Company declared a cash dividend of $0.17 per share of common stock to be paid on May 11, 2026 to all shareholders of record as of the close of business on April 27, 2026.

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

●

risks relating to the acquisition of BOH Holdings, Inc. (“BOH”) including, without limitation: the expected impact of the transaction and on the combined entities’ operations, financial condition, and financial results; the businesses of South Plains and BOH may not be combined successfully, or such combination may take longer to accomplish than expected; the cost savings from the transaction may not be fully realized or may take longer to realize than expected; operating costs, customer loss and business disruption following the transaction, including adverse effects on relationships with employees, may be greater than expected; the risk of deposit and customer attrition; and increased competitive pressures on solicitations of customers by competitors;

●

risks related to the integration of any other acquired businesses, including exposure to potential asset quality and credit quality risks and unknown or contingent liabilities, risks related to entering a new geographic market, the time and costs associated with integrating systems, technology platforms, procedures and personnel, the ability to retain key employees and maintain relationships with significant customers, the need for additional capital to finance such transactions, and possible failures in realizing the anticipated benefits from acquisitions;

●

potential recession in the United States and our market areas;

●

uncertainty or perceived instability in the banking industry as a whole;

●

increased competition for deposits and related changes in deposit customer behavior;

●

the lingering inflationary pressures, and the risk of the resurgence of elevated levels of inflation, in the United States and our market areas, and its impact on market interest rates, the economy and credit quality;

●

business and economic conditions, particularly those affecting our market areas, as well as the concentration of our business in such market areas;

●

the impact of pandemics, epidemics, or any other health-related crisis;

●

high concentrations of loans secured by real estate located in our market areas;

●

increases in unemployment rates in the United States and our market areas;

●

risks associated with our commercial loan portfolio, including the risk for deterioration in value of the general business assets that secure such loans;

●

potential changes in the prices, values and sales volumes of commercial and residential real estate securing our real estate loans;

●

risks associated with our agricultural loan portfolio, including the heightened sensitivity to weather conditions, commodity prices, and other factors generally outside the borrowers and our control;

●

risks related to the significant amount of credit that we have extended to a limited number of borrowers and in a limited geographic area;

●

public funds deposits comprising a relatively high percentage of our deposits;

●

potential impairment on the goodwill we have recorded or may record in connection with business acquisitions;

●

our ability to maintain our reputation;

●

our ability to successfully manage our credit risk and the sufficiency of our allowance for credit losses;

●

our ability to attract, hire and retain qualified management personnel;

●

our dependence on our management team, including our ability to retain executive officers and key employees and their customer and community relationships;

●

interest rate fluctuations, which could have an adverse effect on our profitability;

●

competition from banks, credit unions and other financial services providers;

●

our ability to keep pace with technological change or difficulties we may experience when implementing new technologies;

●

cybersecurity risk, including cyber incidents or other failures, disruptions or breaches of our operational or security systems or infrastructure, or those of our third-party vendors or other service providers, including as a result of a cyber attack, could impact the Company’s reputation, increase regulatory oversight, and impact the financial results of the Company;

●

our ability to maintain effective internal control over financial reporting;

●

employee error, fraudulent activity by employees or customers and inaccurate or incomplete information about our customers and counterparties;

●

increased capital requirements imposed by banking regulators, which may require us to raise capital at a time when capital is not available on favorable terms or at all;

●

our ability to maintain adequate liquidity and to raise necessary capital to fund our acquisition strategy and operations or to meet increased minimum regulatory capital levels;

●

costs and effects of litigation, investigations or similar matters to which we may be subject, including any effect on our reputation;

●

severe weather, natural disasters, military conflicts (including the conflicts in the Middle East, the possible expansion of such conflicts and potential geopolitical and economic consequences), acts of terrorism, geopolitical instability, domestic civil unrest or other external events, including as a result of the impact of the policies of the current U.S. presidential administration or Congress;

●

uncertainty regarding United States fiscal debt, deficit and budget matters;

●

the impacts of tariffs, sanctions, and other trade policies of the United States and its global trading counterparts and the resulting impact on the Company and its customers;

●

compliance with governmental and regulatory requirements, including the Dodd-Frank Act Wall Street Reform and Consumer Protection Act (“Dodd-Frank Act”), Economic Growth, Regulatory Relief, and Consumer Protection Act of 2018 (“EGRRCPA”), and others relating to banking, consumer protection, securities and tax matters;

●

changes in accounting principles and standards, including those related to loan loss recognition under the current expected credit loss, or CECL, methodology;

●

changes in the laws, rules, regulations, interpretations or policies that apply to the Company’s business and operations, and any additional regulations, or repeals that may be forthcoming as a result thereof, which could cause the Company to incur additional costs and adversely affect the Company’s business environment, operations and financial results; and

●

our ability to navigate the uncertain impacts of current and future governmental monetary and fiscal policies, including the current and future policies of the Board of Governors of the Federal Reserve System (“Federal Reserve”) and as a result of initiatives of the Trump administration.

		Three Months Ended March 31,
		2026												2025
		Average Balance				Interest				Yield/ Rate				Average Balance				Interest				Yield/ Rate
		(Dollars in thousands)
Assets:
Interest-earning assets:
Loans (1)		$	3,130,166			$	52,684				6.83	%		$	3,074,568			$	50,577				6.67	%
Investment securities – taxable			490,111				4,285				3.55	%			510,354				4,692				3.73	%
Investment securities – non-taxable			153,265				1,080				2.86	%			153,229				1,014				2.68	%
Other interest-earning assets (2)			556,539				4,817				3.51	%			386,979				3,859				4.04	%
Total interest-earning assets			4,330,081				62,866				5.89	%			4,125,130				60,142				5.91	%
Noninterest-earning assets			180,943												171,683
Total assets		$	4,511,024											$	4,296,813
Liabilities and Stockholders’ Equity:
Interest-bearing liabilities:
NOW, savings and money market deposits		$	2,467,478			$	15,054				2.47	%		$	2,302,344			$	15,511				2.73	%
Time deposits			436,649				3,824				3.55	%			441,895				4,316				3.96	%
Short-term borrowings			3				—				—	%			3				—				—	%
Subordinated debt			14,100				243				6.99	%			63,984				835				5.29	%
Junior subordinated deferrable interest debentures			46,393				659				5.76	%			46,393				733				6.41	%
Total interest-bearing liabilities		$	2,964,623			$	19,780				2.71	%		$	2,854,619			$	21,395				3.04	%
Noninterest-bearing liabilities:
Noninterest-bearing deposits		$	989,518											$	934,775
Other liabilities			57,355												66,073
Total noninterest-bearing liabilities			1,046,873												1,000,848
Stockholders’ equity			499,528												441,346
Total liabilities and stockholders’ equity		$	4,511,024											$	4,296,813
Net interest income						$	43,086											$	38,747
Net interest spread											3.18	%											2.87	%
Net interest margin (3)											4.04	%											3.81	%

(1)	Average loan balances include nonaccrual loans and loans held for sale.

(2)	Includes income and average balances for interest-earning deposits at other banks, nonmarketable securities, federal funds sold, and other miscellaneous interest-earning assets.

(3)	Net interest margin is calculated as the annualized net interest income, on a fully tax-equivalent basis, divided by average interest-earning assets.

		Three Months Ended March 31,
		2026 over 2025
		Change due to:								Total
		Volume				Rate				Variance
		(Dollars in thousands)
Interest-earning assets:
Loans		$	915			$	1,192			$	2,107
Investment securities – taxable			(186	)			(221	)			(407	)
Investment securities – non-taxable			—				66				66
Other interest-earning assets			1,691				(733	)			958
Total interest-earning assets			2,420				304				2,724
Interest-bearing liabilities:
NOW, Savings, MMDAs			1,113				(1,570	)			(457	)
Time deposits			(51	)			(441	)			(492	)
Short-term borrowings			—				—				—
Subordinated debt			(651	)			59				(592	)
Junior subordinated deferrable interest debentures			—				(74	)			(74	)
Total interest-bearing liabilities			411				(2,026	)			(1,615	)
Net change		$	2,009			$	2,330			$	4,339

		Three Months Ended March 31,
		2026				2025				Increase (Decrease)
		(Dollars in thousands)
Noninterest income:
Service charges on deposit accounts		$	2,255			$	2,141			$	114
Bank card services and interchange fees			3,216				3,379				(163	)
Mortgage banking activities			3,918				2,113				1,805
Investment commissions			555				434				121
Fiduciary income			789				738				51
Other income and fees (1)			562				1,820				(1,258	)
Total noninterest income		$	11,295			$	10,625			$	670

(1)

Other income and fees includes income and fees associated with the increase in the cash surrender value of life insurance, safe deposit box rental, check printing, collections, legal settlements, wire transfer, Small Business Investment Company (“SBIC”) investments, income from sweep accounts, and other miscellaneous services.

		Three Months Ended March 31,
		2026				2025				Increase (Decrease)
		(Dollars in thousands)
Noninterest expense:
Salaries and employee benefits		$	20,154			$	19,441			$	713
Occupancy and equipment, net			3,953				4,027				(74	)
Professional services			2,955				1,730				1,225
Marketing and development			1,001				905				96
IT and data services			1,381				1,164				217
Bankcard expenses			1,608				1,454				154
Appraisal expenses			191				192				(1	)
Other expenses (1)			4,283				4,117				166
Total noninterest expense		$	35,526			$	33,030			$	2,496

(1)	Other expenses include items such as banking regulatory assessments, telephone expenses, postage, courier fees, directors’ fees, and insurance.

		Due in One Year or Less				Due after One Year Through Five Years				Due after Five Years Through Fifteen Years				Due after Fifteen Years				Total
		(Dollars in thousands)
Commercial real estate		$	182,980			$	575,625			$	238,759			$	55,587			$	1,052,951
Commercial - specialized			118,127				162,677				63,938				40,119				384,861
Commercial - general			142,606				260,722				171,872				79,434				654,634
Consumer:
1-4 family residential			43,206				118,349				108,887				318,584				589,026
Auto loans			3,401				158,963				93,692				—				256,056
Other consumer			8,573				39,984				14,000				—				62,557
Construction			82,340				17,360				681				3,063				103,444
Total loans		$	581,233			$	1,333,680			$	691,829			$	496,787			$	3,103,529

		Fixed Rate				Adjustable Rate
		(Dollars in thousands)
Commercial real estate		$	331,974			$	537,997
Commercial - specialized			107,204				159,530
Commercial - general			209,996				302,032
Consumer:
1-4 family residential			340,572				205,248
Auto loans			252,655				—
Other consumer			53,984				—
Construction			563				20,541
Total loans		$	1,296,948			$	1,225,348

		March 31, 2026				December 31, 2025
		(Dollars in thousands)
Commitments to grant loans and unfunded commitments under lines of credit		$	627,886			$	554,286
Standby letters of credit			29,791				30,681
Total		$	657,677			$	584,967

		Three Months Ended March 31,
		2026				2025
		(Dollars in thousands)
Average loans outstanding during the period
Commercial real estate		$	1,053,963			$	1,128,386
Commercial – specialized			396,919				379,824
Commercial – general			653,516				561,992
Consumer:
1-4 family residential			591,556				565,967
Auto loans			257,687				258,942
Other consumer			62,089				64,319
Construction			103,054				102,321
Loans held for sale			11,382				12,817
Total average loans outstanding during the period		$	3,130,166			$	3,074,568
Net charge-offs (recoveries) during the period
Commercial real estate		$	—			$	—
Commercial – specialized			(29	)			(34	)
Commercial – general			160				54
Consumer:
1-4 family residential			(294	)			(7	)
Auto loans			250				256
Other consumer			222				255
Construction			—				(5	)
Total net charge-offs (recoveries) during the period		$	309			$	519
Ratio of net charge-offs (recoveries) to average loans during the period
Commercial real estate			—	%			—	%
Commercial – specialized			(0.01	)%			(0.01	)%
Commercial – general			0.02	%			0.01	%
Consumer:
1-4 family residential			(0.05	)%			—	%
Auto loans			0.10	%			0.10	%
Other consumer			0.36	%			0.40	%
Construction			—	%			—	%
Total ratio of net charge-offs (recoveries) to average loans during the period			0.01	%			0.02	%

		March 31,				December 31,
		2026				2025
		(Dollars in thousands)
Total loans held for investment outstanding		$	3,103,529			$	3,144,502
Nonaccrual loans		$	3,680			$	7,070
Allowance for credit losses on loans		$	44,822			$	45,131
Ratio of allowance to total loans held for investment			1.44	%			1.44	%
Ratio of allowance to nonaccrual loans			1,217.99	%			638.35	%
Ratio of nonaccrual loans to total loans held for investment			0.12	%			0.22	%

		March 31, 2026								December 31, 2025
		Amount				% of Total				Amount				% of Total
		(Dollars in thousands)
Commercial real estate		$	15,017				33.5	%		$	15,214				33.8	%
Commercial – specialized			5,351				11.9	%			5,231				11.6	%
Commercial – general			7,384				16.5	%			7,448				16.5	%
Consumer:
1-4 family residential			10,803				24.0	%			11,103				24.6	%
Auto loans			3,298				7.4	%			3,033				6.7	%
Other consumer			1,057				2.4	%			1,150				2.5	%
Construction			1,912				4.3	%			1,952				4.3	%
Total allowance for credit losses		$	44,822				100.0	%		$	45,131				100.0	%

		As of March 31, 2026
		Due in One Year or Less								Due after One Year Through Five Years								Due after Five Years Through Ten Years								Due after Ten Years
		Amortized Cost				Weighted Average Yield				Amortized Cost				Weighted Average Yield				Amortized Cost				Weighted Average Yield				Amortized Cost				Weighted Average Yield
		(Dollars in thousands)
Available-for-sale
U.S government and agencies		$	49,990				3.61	%		$	—				—	%		$	—				—	%		$	—				—	%
State and municipal			—				—	%			5,071				3.01	%			13,909				2.53	%			179,294				2.37	%
Residential mortgage-backed securities			81				1.72	%			975				2.17	%			325				3.01	%			293,676				2.29	%
Commercial mortgage-backed securities			—				—	%			1,524				4.04	%			46,898				2.31	%			1,502				4.55	%
Collateralized mortgage obligations			—				—	%			—				—	%			63,134				4.32	%			4,072				5.23	%
Asset-backed and other amortizing securities			—				—	%			254				3.00	%			1,850				3.20	%			11,446				2.75	%
Other securities			—				—	%			—				—	%			—				—	%			—				—	%
Total available-for-sale		$	50,071				3.61	%		$	7,824				3.11	%		$	126,116				3.35	%		$	489,990				2.36	%

		As of December 31, 2025
		Due in One Year or Less								Due after One Year Through Five Years								Due after Five Years Through Ten Years								Due after Ten Years
		Amortized Cost				Weighted Average Yield				Amortized Cost				Weighted Average Yield				Amortized Cost				Weighted Average Yield				Amortized Cost				Weighted Average Yield
		(Dollars in thousands)
Available-for-sale
State and municipal		$	545				3.46	%		$	5,079				2.72	%		$	12,841				2.40	%		$	180,952				2.38	%
Residential mortgage-backed securities			41				1.33	%			1,040				2.06	%			518				2.97	%			301,112				2.29	%
Commercial mortgage-backed securities			—				—	%			1,525				4.03	%			47,244				2.31	%			—				—	%
Collateralized mortgage obligations			—				—	%			—				—	%			63,398				4.56	%			4,310				5.30	%
Asset-backed and other amortizing securities			—				—	%			254				2.99	%			2,069				3.19	%			11,649				2.75	%
Other securities			—				—	%			5,000				7.53	%			—				—	%			—				—	%
Total available-for-sale		$	586				3.31	%		$	12,898				4.69	%		$	126,070				3.47	%		$	498,023				2.36	%

		March 31, 2026								December 31, 2025
		Amount				% of Total				Amount				% of Total
		(Dollars in thousands)
Noninterest-bearing deposits		$	1,034,117				25.6	%		$	1,023,517				26.4	%
NOW and other transaction accounts			1,276,159				31.7	%			1,307,596				33.8	%
Money market and other savings			1,275,974				31.7	%			1,111,529				28.7	%
Time deposits			441,336				11.0	%			431,435				11.1	%
Total deposits		$	4,027,586				100.0	%		$	3,874,077				100.0	%

		Three Months Ended								Three Months Ended
		March 31, 2026								March 31, 2025
		Average Balance				Weighted Average Rate				Average Balance				Weighted Average Rate
		(Dollars in thousands)
Noninterest-bearing deposits		$	989,518				—	%		$	934,775				—	%
Interest-bearing deposits:
NOW and interest-bearing demand accounts			1,325,052				2.38	%			922,631				2.97	%
Savings accounts			133,101				0.70	%			134,284				0.81	%
Money market accounts			1,009,325				2.83	%			1,245,429				2.76	%
Time deposits			436,649				3.55	%			441,895				3.96	%
Total interest-bearing deposits			2,904,127				2.64	%			2,744,239				2.93	%
Total deposits		$	3,893,645				1.97	%		$	3,679,014				2.19	%

(Dollars in thousands)		Three Months				Three to Six Months				Six to 12 Months				After 12 Months				Total
		$	42,200			$	33,601			$	35,777			$	1,534			$	113,112

Name of Trust	Issue Date		Amount of Trust Preferred Securities				Amount of Debentures				Stated Maturity Date of Trust Preferred Securities and Debentures(1)			Interest Rate of Trust Preferred Securities and Debentures(2)(3)
	(Dollars in thousands)
South Plains Financial Capital Trust III	2004		$	10,000			$	10,310				2034		3-mo. CME Term SOFR + 291 bps; 6.58%
South Plains Financial Capital Trust IV	2005			20,000				20,619				2035		3-mo. CME Term SOFR + 165 bps; 5.33%
South Plains Financial Capital Trust V	2007			15,000				15,464				2037		3-mo. CME Term SOFR + 176 bps; 5.44%
Total			$	45,000			$	46,393

(1)	May be redeemed at the Company’s option.

(2)	Interest payable quarterly with principal due at maturity.

(3)	Rate as of last reset date, prior to March 31, 2026.