First Financial Bankshares, Inc. (FFIN)

First Financial Bankshares, the Abilene, Texas bank holding company, reported third-quarter 2026 earnings of $74.31 million on 15 October, up from $52.27 million a year earlier 1. Diluted earnings per share were $0.52, against $0.36 1. President and CEO David Bailey called it another record quarter, largely driven by continued expansion of the net interest margin 1.

The net interest margin, the gap between what the bank earns on loans and securities and what it pays for deposits, was 3.91 percent on a tax-equivalent basis, up from 3.80 percent a year earlier 1. Net interest income was $138.51 million against $127.00 million 1. The year-earlier quarter also carried a provision for credit losses of $24.44 million, driven by a large loan charged off because of borrower fraud, against $2.03 million this time 1.

Loans grew $191.86 million in the quarter, or 9.12 percent annualized 1. Noninterest expense rose to $81.05 million from $73.67 million a year earlier, which the company tied mainly to annual pay increases in the salary line 1.

First Financial Bank opened its first full-service branch in the Austin area, at Bee Cave, in late October, its 81st location 910. A new chief executive, Bailey, has led the company since February 2026, with F Scott Dueser as Executive Chairman 57.

The company became a bank holding company in 1956 as F & M Operating Company, but its banking dates to 1890, when Farmers and Merchants National Bank opened in Abilene, Texas 2. It has offered trust services since 1927 2. It folded its bank charters into one in 2012, yet kept local advisory boards and local decisions 2.

Growth has come three ways: organically, by opening branches and by buying other banks 2. Since 1997 the company has completed fourteen bank acquisitions and raised total assets from $1.57 billion to $15.45 billion at the end of 2025 2.

On 31 July 2015 it completed the purchase of FBC Bancshares and its First Bank of Conroe, Texas, which had about $372.19 million in assets and widened its Texas network 13. On 1 January 2018 it completed Commercial Bancshares of Kingwood, Texas, whose Commercial State Bank had about $390.2 million in assets 12. On 1 January 2020 it completed TB&T Bancshares of Bryan, Texas, whose bank had about $631.1 million in assets 11.

The Federal Reserve began raising rates in March 2022 and took them to a peak range of 5.25 percent to 5.50 percent 2. Interest expense, what the bank pays on deposits, climbed from $6.04 million in 2021 to $202.18 million in 2024 2.

Net interest income, the core earnings line, was $370.36 million in 2021, $401.41 million in 2022, $383.81 million in 2023, $426.74 million in 2024 and $500.89 million in 2025 2. Net earnings followed: $234.5 million in 2022, $198.98 million in 2023, $223.51 million in 2024 and $253.58 million in 2025 2.

In 2023 the company sold available-for-sale securities totaling $411.13 million at a loss of $7.12 million and used the proceeds to fund higher-yielding loans in 2024 2. It sold no securities in 2024 or 2025 2.

The net interest margin rose from 3.29 percent in 2023 to 3.50 percent in 2024 and 3.79 percent in 2025 2. The company credited a shift from lower-yielding securities to loans, strong deposit growth and loans repricing higher 2.

A bump came in the third quarter of 2025, when a large loan was charged off because of borrower fraud and net charge-offs reached $22.34 million 1. Earnings that quarter were $52.27 million 1, below the $73.31 million of the fourth quarter 3.

On 28 January the boards announced the promotion of David Bailey to CEO of the company and the bank, replacing F Scott Dueser, who had led as CEO since 2001 57. Dueser agreed to stay as Executive Chairman through the 2028 Annual Meeting 5.

The first quarter of 2026 brought earnings of $71.54 million, a rise in net income of 16.6 percent year over year 3. The company said it came mainly from core balance sheet growth and lower funding costs over the past year 3.

Community banking in Texas

First Financial Bank, the main subsidiary, runs a full-service commercial banking business 2. Its eight banking regions take deposits, make loans and offer ATMs, internet and mobile banking, payroll cards and funds transfer 2. The company keeps its focus on Texas, with 79 financial centers at the end of 2025 and 81 locations after the Bee Cave branch opened 21.

Loans were $8.16 billion at the end of 2025 and total assets $15.45 billion, with deposits of $13.35 billion 2. Interest income was $702.48 million in 2025, against noninterest income of $130.72 million 2.

Commercial real estate loans are 23.94 percent of loans, with industrial and manufacturing property the largest type at about 18.60 percent and multifamily at about 7.75 percent of that portfolio 2. Non-owner occupied commercial real estate is $832.82 million 2.

Trust and wealth management

First Financial Trust & Asset Management Company offers wealth management, estate administration, oil and gas management, farm and ranch and property management, trusts and retirement accounts 2. It has nine locations, all in Texas 2.

Trust fees were $51.86 million in 2025, up 9.30 percent, as assets under management reached $11.94 billion 2. In the third quarter of 2026 wealth management fee income was $14.49 million and assets under management $12.35 billion, helped by new accounts and mineral fee income tied to oil and gas prices 1.

Mortgages and everyday fees

Mortgage income was $15.55 million in 2025, up from $13.18 million, on more loans and better margins 2. It fell to $4.18 million in the third quarter of 2026 because mortgage volume and margins were hurt by a spike in long-term rates 1.

Service charges on deposit accounts were $24.89 million and debit card fees $21.31 million in 2025 2. The company also reported $3.59 million of loan recoveries 2.

Funding, capital and credit

Average noninterest-bearing deposits were $3.38 billion in 2025, and $1.52 billion of municipal and related deposits are indexed to short-term Treasury rates 2. The leverage ratio was 12.55 percent and the common equity tier 1 ratio 19.99 percent at the end of 2025 2.

At 30 September 2026 the allowance for credit losses was $113.89 million, or 1.33 percent of loans, and nonperforming assets were 0.71 percent of loans and foreclosed assets 1. Classified loans totaled $294.49 million, up from $252.96 million a year before 1.

The unrealized loss on securities, net of tax, totaled $489.55 million at 30 September 2026, against $279.67 million at 30 June, and shareholders' equity fell to $1.83 billion from $2.00 billion 1.

People, branches and rivals

About 1,600 people worked at the company at the end of 2025, roughly 1,500 of them full-time 2. Bailey is President and CEO, Dueser is Executive Chairman, and Michelle S Hickox is Chief Financial Officer 15.

Its subsidiaries own 79 banking, trust and mortgage facilities and lease 11 banking facilities and 10 ATM locations 2. New branches were under construction in Franklin and Beaumont, plus a new motor bank in Abilene 2.

Rivals include banks, thrifts, credit unions, mortgage companies, insurance companies, fintech firms and brokerages, some larger than the company 2. It has less than 1 percent of Texas deposits, and it names continued bank mergers in its area, which leave fewer but much larger competitors, as a risk 2.

The annual report and the latest quarterly report both say no material legal proceedings are pending 26.

The umbrella, in words

The brand is First Financial Bank, with regions across Central, North Central, Southeast and West Texas 2. The company's wholly owned subsidiaries are First Financial Bank, First Technology Services, First Financial Trust & Asset Management Company, First Financial Insurance Agency, FFB Investment Paris Fund and FFB Portfolio Management, each 100 percent owned 8.

First Technology Services is a technology operating company that is a subsidiary of the bank 12. Securities brokerage is offered through an arrangement with an unrelated third party in the Abilene and San Angelo regions 2.

The principal office is the First Financial Bank Building at 400 Pine Street in downtown Abilene 2. The company also runs mortgage offices in Austin and Addison 2.

The proxy lists BlackRock with 16,172,949 shares, or 11.29 percent, and Vanguard with 14,465,522 shares, or 10.10 percent, as of 31 December 2025 7. The company reported 797 registered shareholders of record in February 2026 2.

On 30 July 2026 the company announced a renewed and larger share repurchase plan through 31 July 2027, allowing up to 7,200,000 shares, about 5 percent of shares outstanding on 28 July 2026 4. The earlier plan covered up to 5,000,000 shares and ran through 31 July 2026 4.

The plan sets no minimum, and the annual and quarterly reports record no repurchases during 2025 or through 30 June 2026 426.

The company says it intends to keep growing organically, serving customers and evaluating branch sites in current communities and new markets 2. It also says it remains interested in buying high quality banks 2.

Its acquisition target range is banks between $1.0 billion and $5.0 billion in assets, its "sweet spot," though it would consider larger banks or banks elsewhere in Texas if they fit its culture and finances 2. It generally looks at non-metropolitan markets near Dallas/Fort Worth, Houston, San Antonio or Austin, or along the Interstate 35, 45, 10 and 20 corridors 2.

Construction was under way at the end of 2025 for new branches in Franklin and Beaumont, Texas, and a new motor bank in Abilene 2.

In the third-quarter release, Bailey said the company remains focused on disciplined balance sheet growth and prudent risk management, and called Bee Cave an important step in expansion across Texas 1.

Dueser has committed to stay on as Executive Chairman through the 2028 Annual Meeting, which the boards described as part of the management succession plan 5.

Two accounting changes are due: expense breakdowns in the 2027 annual report and a purchased-loans rule from 1 January 2027 2. The company does not expect a significant effect from either 2.

The company's own list of factors that could change its results includes trade, monetary and fiscal policy, the Federal Reserve Board's interest rate policies and the economic impact of oil and gas prices 1.

Among the risks the annual report names are expansion into new markets, acquisitions and integration of acquired businesses, and the rise of artificial intelligence as a commonly used resource 2.