PB Completes American Bank Buyout, Expands Texas Footprint

Core Insights - Prosperity Bancshares, Inc. (PB) has completed the acquisition of American Bank Holding Corporation (ABHC) effective January 1, 2026, with operational integration scheduled for September 2026 [1][7] - The all-stock merger deal, valued at $321.5 million, was announced on July 18, 2025, aiming to enhance PB's presence in South and Central Texas markets [1][7] Financial Impact - Upon closure, PB issued 4,439,981 shares of common stock to ABHC's former shareholders and award holders, bringing $2.3 billion in deposits and $1.8 billion in loans to the combined entity [2] - The merger is projected to deliver a 2% increase in PB's earnings per share by 2026 and a 3.8% increase by 2027, assuming 50% phased-in cost savings [3] - Estimated annual cost savings are equivalent to 40% of ABHC's projected 2025 non-interest expense base, with implementation over two years [4] Adjustments and Projections - The deal is expected to result in a tangible book value per share dilution of 2.2%, with an earn-back period of three years [4] - A $21 million gross loan credit mark, representing 1.2% of ABHC's total loans, will be applied, along with a $26 million pre-tax rate write-down to be amortized over five years [5] Market Performance - Over the past three months, shares of Prosperity Bancshares have gained 7.1%, outperforming the industry's growth of 1.7% [6]