Cullen/Frost Bankers Q2 Earnings Call Highlights

Cullen/Frost Bankers reported second-quarter 2026 net income of $170.4 million, up 9.7% from $155.3 million a year earlier, as the Texas-focused bank cited loan growth, customer acquisition and expanding fee revenue.

Earnings per share rose 13% year over year to $2.70. Chairman and Chief Executive Officer Phil Green said the company generated a 1.30% return on average assets and a 15.41% return on average common equity during the quarter.

Average deposits increased to $42.6 billion from $41.8 billion a year earlier, while average loans rose to $22.6 billion from $21.1 billion.

Green said consumer checking-account household growth accelerated to 5.7% year over year, compared with 5.3% reported a year earlier. Consumer checking accounts have increased 47% since Frost began its expansion effort in late 2018, and about one-third of its customers are new to the bank since that initiative began, he said.

Consumer loans ended the quarter above $4.5 billion, increasing $751 million, or 20%, from the prior year. Mortgage lending accounted for $533 million of that growth, while second-lien home equity products grew by $198 million.

Green said consumer deposits declined 0.7% from the first quarter, primarily reflecting seasonal patterns.

Commercial activity also strengthened. The bank’s 90-day weighted loan pipeline reached a record $2.17 billion, up 11% from the first quarter. About half of the pipeline was commercial and industrial lending and half was commercial real estate, while 62% represented existing customer opportunities. New loan commitments rose 23% from the first quarter, with growth across C&I, commercial real estate, energy and personal lending. New commercial relationships declined 1% sequentially but remained above 1,000 for the fifth consecutive quarter.

Green said market disruption continued to support relationship acquisition, with new relationships from that source up 65% year to date from the same period in 2025.

Group Executive Vice President and Chief Financial Officer Dan Geddes said the branch expansion program contributed $0.16 per share of earnings, or 5.8% of total EPS, in the second quarter. Expansion branches have grown to $3 billion in loans, $3.7 billion in deposits and more than 100,000 new households. Average loans from the expansion markets rose 38% year over year and accounted for 53% of the company’s total loan growth. Expansion-market deposits increased 20% and contributed 72% of deposit growth. The company opened five new locations during the quarter, including branches in the Austin, Dallas, San Antonio and Fort Worth regions. It plans to open another five branches during the remainder of 2026.