Cullen/Frost Bankers (CFR) investor relations material

Executive summary

• Net income for Q2 2026 was $170.4 million, up 9.7% year-over-year, with EPS rising to $2.70 per share and return on average assets at 1.30% and return on average common equity at 15.41%.

• Net income available to common shareholders for the first half of 2026 was $339.7 million, up 11.5% year-over-year.

• Opened four to five new financial centers in Texas in Q2, with a total of seven new locations year-to-date.

• Customer households grew by 5.9% year-over-year, with consumer checking account household growth accelerating to 5.7%.

• Commercial loan pipeline reached a record $2.17 billion, with balanced growth across C&I and CRE segments.

Financial highlights

• Net interest income for Q2 2026 was $470.1 million, up 4.3% year-over-year, and non-interest income rose 9.4% to $128.3 million, led by trust and investment management fees.

• Non-interest income per consumer rose 11% year-over-year to $2.89.

• Consumer loans outstanding grew by $751 million (20% annual growth), driven by mortgages and home equity products.

• Net interest margin for Q2 was 3.75%, up from 3.67% in Q2 2025.

• Credit loss expense for Q2 2026 was $9.8 million, with net charge-offs of $9.5 million and non-performing assets increasing to $114 million, mainly due to a single $54 million CRE loan.

Outlook and guidance

• Full-year 2026 net interest income growth expected at 4.75%-5.25%, with net interest margin projected to improve by 10-13 basis points over 2025.

• Average loan growth guidance raised to 7%-8%; deposit growth guidance maintained at 2%-3%.

• Non-interest income growth outlook increased to 8.5%; non-interest expense growth guidance lowered to 4.5%-5%.

• Net charge-offs expected in the range of 15-20 basis points of average loans for 2026.

• Management expects continued growth in net interest income, supported by a stable deposit base and loan growth, but notes potential headwinds from interest rate volatility and competitive deposit markets.