Stellar Bancorp Inc SEC Filings

Stellar Bancorp, Inc. reports on its 2025 operations as a Houston-based bank holding company and discloses a pending merger with Prosperity Bancshares, Inc. Under the agreement, each Stellar share will convert into 0.3803 Prosperity shares plus $11.36 in cash at closing.

As of December 31, 2025, Stellar had total assets of $10.81 billion, loans of $7.30 billion, deposits of $9.02 billion and shareholders’ equity of $1.67 billion. The company operates 52 banking centers across Texas, focuses on small- and medium-sized business clients, and emphasizes strong capital ratios and disciplined underwriting.

Stellar Bancorp, Inc. announced that its Board of Directors declared a quarterly cash dividend of $0.15 per share of common stock. The dividend will be paid on March 31, 2026 to shareholders of record at the close of business on March 16, 2026.

The company, a Houston-based bank holding company whose principal subsidiary is Stellar Bank, provides commercial banking services primarily to small- and medium-sized businesses and individual customers across several Texas markets.

North Reef Capital Management LP, its general partner and principal James Hanna III reported a passive stake in Stellar Bancorp, Inc. common stock. They beneficially own 2,875,245 shares, representing 5.62% of the outstanding common stock as of 12/31/2025.

The filing shows shared voting and dispositive power over all reported shares and no sole voting or dispositive power. The group certifies the position was acquired and is held in the ordinary course of business, not for the purpose of changing or influencing control of Stellar Bancorp.

Stellar Bancorp and Prosperity Bancshares use this call to explain the strategic and financial logic of their proposed merger. Management highlights that combining the banks would lift Prosperity’s Houston deposit rank from ninth to fifth, making it the largest Texas-based bank in that market and second-largest by deposits in the state.

Leaders from both companies describe a close cultural and credit-risk fit, emphasizing similar focus on low-cost core deposits, conservative underwriting and granular commercial lending. They discuss internal expectations for Stellar’s earnings, citing a fourth-quarter 2025 EPS run-rate of about $0.55, or $2.20 annualized, and note roughly $100 million more interest-earning assets entering 2026.

Prosperity projects meaningful long-term accretion from Stellar and two other pending deals, targeting 2027 EPS of $7.34 and an increase in return on average tangible capital from 13% to 17%. Management defends paying about 18 times one-year forward earnings, citing Stellar’s strong noninterest-bearing deposit base, higher net interest margin around 4.2% versus Prosperity’s 3.5%, and the enhanced franchise value of a larger Texas platform.

Prosperity Bancshares used its Q4 2025 call to explain its proposed acquisition of Stellar Bancorp and the expected impact on earnings, margins, and capital. Management said the deal would move the combined bank’s Houston deposit rank from ninth to fifth and make it the largest Texas-based bank in that market. Stellar’s stronger margin, around 4.2%, is expected to lift Prosperity’s net interest margin above 3.5% in 2026, helped by Stellar’s granular loan book and non‑interest‑bearing deposits. For 2027, Prosperity is targeting $7.34 in EPS and a return on average tangible capital rising from 13% to about 17%, arguing the premium price (about 18x one‑year‑forward earnings and a 4.5‑year earn‑back) is justified by franchise value. Executives emphasized strong cultural and credit alignment, extensive leadership relationships, retention and non‑compete agreements, and ample liquidity and capital, while also outlining standard regulatory, integration, and execution risks in detailed forward‑looking statements.

Prosperity Bancshares, Inc. agreed to acquire Stellar Bancorp, Inc. in a stock-and-cash merger. Stellar will merge into Prosperity, followed by Stellar Bank merging into Prosperity Bank, with Prosperity and Prosperity Bank remaining as the surviving entities.

Each share of Stellar common stock will be converted into 0.3803 shares of Prosperity common stock plus $11.36 in cash, subject to a cap that can slightly reduce the stock portion and increase the cash portion if Prosperity would otherwise issue more than 19.9% of its pre-deal shares. Stellar directors holding about 8.8% of Stellar shares have signed voting agreements supporting the deal, and a termination fee of $78 million may be payable by Stellar if the agreement ends under specified circumstances. Closing requires Stellar shareholder approval and multiple U.S. bank regulatory approvals, and the parties intend the merger to qualify as a tax-free reorganization.

Stellar Bancorp, Inc. entered into a definitive agreement to merge with Prosperity Bancshares, Inc., with Stellar merging into Prosperity and Stellar Bank combining into Prosperity Bank after closing. Prosperity will be the surviving public company.

Each share of Stellar common stock will be converted into 0.3803 shares of Prosperity common stock plus $11.36 in cash, with cash paid instead of fractional Prosperity shares. The merger requires Stellar shareholder approval, multiple bank regulatory approvals and effectiveness of a Form S-4 registration statement. Stellar faces a $78 million termination fee in certain breakup scenarios. Directors holding about 8.8% of Stellar shares signed voting agreements supporting the deal and separate two‑year director support agreements restricting use of confidential information and certain solicitation of customers and employees.

Stellar Bancorp, Inc. agreed to merge with Prosperity Bancshares, Inc., with Stellar combining into Prosperity and Stellar Bank combining into Prosperity Bank. Prosperity will be the surviving corporation and bank.

At closing, each share of Stellar common stock will be converted into the right to receive 0.3803 shares of Prosperity common stock plus $11.36 in cash, with cash paid instead of fractional Prosperity shares. The boards of both companies unanimously approved the merger, and Prosperity will add two Stellar-affiliated directors to each of the Prosperity and Prosperity Bank boards.

Completion depends on Stellar shareholder approval, regulatory approvals, NYSE listing of the Prosperity shares to be issued, effectiveness of a Form S-4 registration statement, and customary closing conditions, including tax opinions that the merger qualifies as a reorganization. The agreement includes a $78 million termination fee payable by Stellar in specified circumstances.

Prosperity also entered into voting agreements with Stellar directors covering about 8.8% of Stellar’s outstanding shares and separate two-year support agreements restricting those directors’ use of confidential information and certain solicitation of customers and employees after closing.

Stellar Bancorp, Inc. plans to merge with Prosperity Bancshares, Inc. under a definitive Agreement and Plan of Merger dated January 27, 2026. The combined bank is expected to have approximately $54 billion in assets and become the second-largest Texas‑headquartered bank by assets. Management highlights Prosperity’s similar community‑banking culture, strong capital position and over 300 locations across Texas and Oklahoma. The merger is expected to close late in the second quarter of 2026, subject to customary shareholder and regulatory approvals and other closing conditions. Stellar emphasizes that it remains business as usual until closing and that employees will receive information about future roles within about six weeks, with further details on benefits and compensation to follow. The communication also includes extensive forward‑looking statement cautions and notes that a Form S‑4 registration statement and joint proxy statement/prospectus will be filed with the SEC.