Key Highlights

  • Income to common was USD 24.9 million, or USD 0.44 per diluted share.
  • PlainsCapital Bank earned USD 44 million pre-tax on a 1.1% return on assets.
  • PrimeLending reported a pre-tax loss of USD 11 million.
  • Net interest Margin rose to 3.33% from 3.21%.

Results by Segment

Hilltop Holdings (NYSE:HTH) reported third-quarter 2026 results on Thursday. Income attributable to common stockholders was USD 24.9 million, or USD 0.44 per diluted share, against USD 45.8 million, or USD 0.74, a year earlier. Consolidated annualized return on average assets was 0.67% and return on average Equity was 4.67%, against 1.20% and 8.35%.

Chairman, President and Chief Executive Officer Jeremy Ford described a volatile quarter marked by a policy Reversal at the Federal Reserve and rapidly rising rates. PlainsCapital Bank earned a 1.1% Return on Assets and USD 44 million of pre-tax income, with net interest margin expansion and earning asset growth partly offset by a USD 10 million provision. HilltopSecurities earned USD 7 million pre-tax on USD 117 million of net revenues, a 5.9% margin, led by Public Finance Services and Wealth Management. Structured Finance and Fixed Income Services were hurt by the speed and size of the change in long-term rates.

Mortgage Business and Margin

PrimeLending reported a pre-tax loss of USD 11 million, as the rise in Mortgage rates during the quarter depressed purchase activity and lowered the mark-to-market value of loans in the pipeline. Net gains from sale of loans and other mortgage production income and origination fees were USD 67.7 million against USD 76.6 million a year earlier, an 11.6% decrease. Origination Volume was USD 2.2 billion against USD 2.3 billion. Net gains from loans sold to third parties were 211 basis points against 229 in the second quarter.

The consolidated net interest margin rose to 3.33% from 3.21%. Noninterest income was USD 187.1 million against USD 217.8 million a year earlier. Noninterest expense was USD 264.1 million against USD 271.9 million, a 2.9% decrease. The effective tax rate was 25.2% against 23.2%, which the company tied to nondeductible expenses and valuation allowances.

Loans, Deposits and Credit

The provision for Credit losses was USD 10.2 million, against reversals of USD 1.0 million in the second quarter and USD 2.5 million a year earlier. The company cited Loan mix and risk rating migration, net loan growth, a build in specific reserves and changes in the economic outlook. Loans held for Investment were USD 8,807 million before the allowance of USD 93.9 million, up from USD 8,673 million. Net loans were USD 8.3 billion against USD 8.2 billion.

Non-accrual loans were USD 51.4 million, or 0.54% of loans, against USD 54.8 million, or 0.57%. Loans held for sale fell 37.7% to USD 625.6 million. Total deposits were USD 11.0 billion against USD 10.5 billion, including estimated uninsured deposits of USD 6.0 billion, or about 55%. Total assets were USD 16.2 billion against USD 16.0 billion.

Capital Return

The Tier 1 Leverage Ratio was 12.63% and the common equity tier 1 ratio was 18.28%. Book Value per share was USD 36.99 against USD 37.12. Hilltop paid USD 20.0 million to repurchase 512,075 shares at an average of USD 38.96, leaving about USD 86 million of capacity through the January 2027 expiration of the program. With dividends, it returned about USD 33 million. The board declared a quarterly Dividend of USD 0.22 per share, payable Nov. 20 to holders of record on Nov. 6.

Items to Follow

Income to common fell 46% from a year earlier, while the bank segment earned USD 44 million before tax and PrimeLending lost USD 11 million. The company cited tariffs, Treasury yields, mortgage rates, funding costs, inflation, energy prices and armed conflicts as factors outside its control. Reference points include mortgage volume against USD 2.2 billion, the 211 basis point gain on sale margin, bank provisioning, and the 0.54% non-accrual ratio.