Simmons First National Corporation Reports First Quarter 2026 Results

Key Financial Highlights

• Net Income: \$68.5 million for Q1 2026, compared to \$78.1 million in Q4 2025 and \$32.4 million in Q1 2025.
• Diluted Earnings Per Share (EPS): \$0.47 for Q1 2026, versus \$0.54 in Q4 2025 and \$0.26 in Q1 2025.
• Adjusted Net Income: \$68.6 million for Q1 2026; adjusted diluted EPS also at \$0.47.
• Cash Dividend Declared: \$0.215 per common share, slightly higher than Q4 2025 (\$0.2125), maintaining shareholder returns.
• Total Loans: \$17.93 billion at quarter end, up from \$17.49 billion in Q4 2025.
• Return on Average Assets: 1.13% in Q1 2026, down from 1.28% in Q4 2025 but up significantly from 0.49% in Q1 2025.
• Equity to Assets Ratio: 13.92% at quarter end, stable compared to previous quarter.
• Tangible Common Equity Ratio: 8.74% at quarter end, up from 8.34% a year ago.
• Common Equity Tier 1 (CET1) Ratio: 11.58% for Q1 2026, slightly lower than 12.21% in Q1 2025.
• Total Risk-Based Capital Ratio: 14.36% in Q1 2026, marginally down year-over-year.

Items Impacting Earnings

Several non-recurring items affected quarterly earnings:

• FDIC Deposit Insurance Special Assessment: -\$2.0 million in Q1 2026. This is a one-off regulatory cost and could impact profitability.
• Professional Services: +\$1.2 million in Q1 2026, indicating higher expenses for consulting or advisory fees.
• Branch Right Sizing Costs: +\$0.6 million, reflecting ongoing optimization of the branch network.
• Early Retirement Program Costs: +\$0.3 million, possibly signaling restructuring efforts.
• Loss on Sale of Equipment Finance Business: No material loss in Q1 2026, but \$1.1 million in Q4 2025.

Overall, the net impact of these items on earnings for Q1 2026 was minimal (+\$0.1 million), but investors should note that these types of costs may recur as the company continues strategic adjustments.

Balance Sheet and Capital Position

• Book Value Per Share: \$23.70 at the end of Q1 2026, up from \$23.62 in Q4 2025 but notably down from \$28.04 in Q1 2025.
• Tangible Book Value Per Share: \$14.03 in Q1 2026, a modest increase from the prior quarter (\$13.91), but lower than \$16.81 a year earlier.
• Total Stockholders’ Equity: \$3.44 billion as of Q1 2026, compared to \$3.42 billion in Q4 2025 and \$3.53 billion in Q1 2025.
• Capital Ratios: All regulatory capital ratios remain well above “well-capitalized” thresholds, providing financial stability.
• Allowance for Credit Losses: 1.28% of loans, unchanged from Q4 2025 but improved from 1.48% in Q1 2025, suggesting improved asset quality.

Interest Rate and Margin Trends

• Net Interest Margin (FTE): 3.84% in Q1 2026, a slight improvement over Q4 2025 (3.81%).
• Cost of Deposits: 1.96% in Q1 2026, marginally lower than Q4 2025 (2.04%), indicating some relief in deposit cost pressures.
• Investment Securities Yield (FTE): 4.25% in Q1 2026, down from 4.30% in Q4 2025 but up year-over-year.

Noninterest Income and Expense

• Debit and Credit Card Fees: \$8.5 million in Q1 2026, stable year-over-year.
• Mortgage Lending Income: \$1.9 million, decreased from previous quarters and years, reflecting softer mortgage activity.
• Bank Owned Life Insurance Income: \$4.2 million, up from Q4 2025 (\$3.9 million).
• Deposit Insurance Expense: \$2.3 million, down sharply from \$4.7 million in Q4 2025, likely reflecting the FDIC special assessment paid in Q1 2026.

Shareholder Returns

• Cash Dividend: \$0.215 per share for Q1 2026, consistent with prior quarters.
• Shares Outstanding: 145,058,331 at quarter-end, up from 125,926,822 a year ago, possibly due to issuances or stock-based compensation.

Efficiency and Profitability Metrics

• Efficiency Ratio: 57.56% for Q1 2026, indicating stable cost control.
• Adjusted Efficiency Ratio: 56.16%, showing improvement versus prior quarters.
• Adjusted Return on Average Assets: 1.13% in Q1 2026, steady and improved from prior year.
• Adjusted Return on Tangible Common Equity: 13.91% in Q1 2026, reflecting strong profitability on core capital.

Liquidity Position

• Additional Liquidity Sources: \$8.997 billion at quarter-end, supporting financial resilience and lending capacity.

Forward-Looking Statements and Risks

Management has highlighted numerous risks and uncertainties:

• Potential changes in economic conditions, credit quality, and interest rates.
• Effects of government shutdowns, changes in loan demand, deposit flows, and real estate values.
• Market disruptions, including geopolitical risks, pandemics, and financial crises.
• Risks from mergers and acquisitions, cybersecurity threats, and regulatory changes.
• Uncertainty around future dividends—no guarantee of continued or increased payouts.

Investors should monitor these risks, as they may materially impact future performance and share value.

Summary for Investors

• Simmons First National Corporation delivered stable earnings and maintained strong capital ratios in Q1 2026, with improvements in asset quality and liquidity.
• Non-recurring costs (FDIC assessment, restructuring expenses) were minimal this quarter but could recur with further strategic actions.
• Book value and tangible book value per share remain below year-ago levels, reflecting prior balance sheet repositioning.
• Dividend remains steady, but future payments are not guaranteed and are subject to Board discretion.
• All key regulatory capital ratios are well above required thresholds.
• Efficiency and profitability metrics show improvement, supporting investor confidence in management’s execution.
• Risks remain from macroeconomic, regulatory, and operational factors.

Potential Price-Sensitive Information

• Stable earnings and dividend could support share price.
• Year-over-year decline in book value per share and tangible book value per share may concern some investors, reflecting previous balance sheet changes.
• Minimal impact from non-recurring items is positive, but ongoing strategic costs may affect future profitability.
• Strong capital ratios and liquidity provide downside protection.
• Risks and uncertainties outlined by management should be carefully considered, especially regarding dividend policy and macroeconomic factors.

Disclaimer

The information provided in this article is for informational purposes only and does not constitute investment advice. Investors should perform their own research and consult their financial advisors before making investment decisions. Simmons First National Corporation’s future performance is subject to various risks and uncertainties as described above. The company’s actual results may differ materially from forward-looking statements.

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