First Financial Bankshares renews $50 million credit line with Frost Bank

First Financial Bankshares , Inc. (NASDAQ:FFIN), a $5.3 billion regional banking institution with strong financial metrics according to InvestingPro, renewed its revolving line of credit with Frost Bank, according to a press release statement based on a filing with the Securities and Exchange Commission.

The renewal, executed June 30, 2025, amends the company’s existing loan agreement and promissory note. Under the revised terms, First Financial Bankshares is permitted to draw up to $50 million on a revolving, unsecured line of credit. The facility matures on June 30, 2027, with interest payable quarterly at the U.S. prime rate as published in The Wall Street Journal.

If any balance remains as of July 1, 2027, the outstanding principal will convert to a term loan, to be repaid quarterly over five years, with interest continuing at the U.S. prime rate.

The loan agreement includes financial covenants requiring the company to maintain certain capital, profitability, loan loss reserve, non-performing asset, and debt service coverage ratios. Operational covenants restrict dividend payments to no more than 55% of consolidated net income, limit the incurrence of additional debt (excluding amounts from acquisitions), and prohibit the disposal of assets outside the ordinary course of business.

Since 1995, First Financial Bankshares has declared dividends ranging from 36% to 53% of consolidated net income. The company has maintained dividend payments for 33 consecutive years and currently offers a 2.01% yield. For the three months ended March 31, 2025, dividends represented 42.02% of consolidated net income. With a conservative debt-to-equity ratio of 0.05 and strong financial health metrics (InvestingPro data reveals 8 additional key financial insights), the company reported no borrowings under the line of credit in 2025, 2024, or 2023.

This information is based on a press release statement and the company’s filing with the Securities and Exchange Commission.

In other recent news, First Financial Bankshares, Inc. reported first-quarter 2025 earnings that exceeded analyst expectations, with adjusted earnings per share reaching $0.43, surpassing the consensus estimate of $0.39. Despite this positive earnings performance, the company’s revenue slightly missed projections, coming in at $149.02 million compared to the anticipated $149.48 million. Net income for the quarter increased to $61.35 million, up from $53.40 million in the same quarter the previous year, while net interest income saw a rise to $118.79 million, driven by balance sheet growth and an improved net interest margin. Additionally, First Financial Bankshares declared a $0.19 per share cash dividend for the second quarter, reflecting a 5.6 percent increase from prior dividends.

The company’s annual shareholders’ meeting also saw the election of thirteen directors to its Board, with April Anthony retiring after a decade of service. Shareholders ratified Ernst & Young LLP as the independent auditors and approved the executive compensation advisory vote. The provision for credit losses rose to $3.53 million in Q1 2025, up from $808,000 in the previous year, while nonperforming assets increased to 0.78% from 0.51% year-over-year. Total (EPA:TTEF) deposits and repurchase agreements reached $12.52 billion by the end of the quarter, marking a 12.10% annualized growth from the prior quarter.

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