Stonegate Updates Coverage on Third Coast Bancshares Following Q4 2025 Results

Stonegate Capital Partners has updated its coverage on Third Coast Bancshares, Inc. following the company's fourth quarter 2025 financial results. For the quarter, Third Coast reported net income of $17.9 million, which compares to $18.1 million in the third quarter of 2025 and $13.7 million in the fourth quarter of 2024. This resulted in basic and diluted earnings per share of $1.21 and $1.02, respectively. The modest quarter-over-quarter decline was primarily driven by merger-related legal and professional expenses as well as higher salaries and benefits. These increases were partially offset by higher net interest income and an increase in non-margin loan fees.

The company's net interest margin held steady at 4.10% for the period, indicating stability in its core lending profitability despite the integration activities. Stonegate anticipates that Third Coast will continue prioritizing operational efficiency, though near-term expense levels may remain somewhat volatile through the early stages of integrating Keystone. The merger itself remains on track according to the update. Furthermore, Third Coast has increased the low end of its deposit growth range, signaling confidence in its funding base and potential for balance sheet expansion. To view the full announcement, including downloadable images and additional details, visit https://www.stonegateinc.com.

The implications of this financial update are significant for investors monitoring the bank's performance amid its acquisition strategy. The steady net interest margin suggests the company has maintained pricing discipline and asset yield despite a competitive banking environment. The increase in the deposit growth target range may indicate an aggressive strategy to gather low-cost funding, which is crucial for supporting loan growth and maintaining the net interest margin. However, the persistence of elevated merger-related expenses highlights the ongoing costs and operational complexities associated with bank consolidation. Investors will be watching closely to see if the projected operational efficiencies materialize as the Keystone integration progresses, as this will be key to improving future profitability and returns.

The report from Stonegate provides essential context for understanding Third Coast's current financial position and strategic direction. The ability to manage expenses while integrating an acquisition will test management's execution capabilities. The maintained net interest margin in the face of industry-wide pressure on spreads is a positive indicator of the bank's underlying business strength. The adjustment to deposit growth expectations reflects a proactive approach to liquidity management in a changing rate environment. For a comprehensive analysis of these results and their implications for the company's valuation and outlook, the full research update is available through Stonegate Capital Partners.