- First quarter net income of $122.3 million and earnings per share (diluted) of $1.33

- Deposits increased $296.5 million or 1.0% (3.9% annualized) during the first quarter 2022

- Allowance for credit losses on loans and on off-balance sheet credit exposure of $315.1 million

- Allowance for credit losses on loans to total loans, excluding Warehouse Purchase Program and SBA Paycheck Protection Program loans, of 1.71%⁽¹⁾

- Nonperforming assets remain low at 0.08% of first quarter average interest-earning assets

- Return (annualized) on first quarter average assets of 1.29%

- Returns (annualized) on first quarter average common equity of 7.54% and average tangible common equity of 15.30%⁽¹⁾

- Prosperity Bancshares was ranked Number 6 in Forbes' 2022 America's Best Banks

HOUSTON, April 27, 2022 /PRNewswire/ -- Prosperity Bancshares, Inc.^® (NYSE:PB), the parent company of Prosperity Bank^® (collectively, "Prosperity"), reported net income of $122.3 million for the quarter ended March 31, 2022 compared with $133.3 million for the same period in 2021. Net income per diluted common share was $1.33 for the quarter ended March 31, 2022, compared with $1.44 for the same period in 2021, and the annualized return on first quarter average assets was 1.29%. Nonperforming assets remain low at 0.08% of first quarter average interest-earning assets.

"Each year, Forbes assesses the 100 largest banks in the United States on growth, credit quality and earnings, as well as other factors, for its America's Best Banks list. Prosperity Bank has been ranked in the Top 10 since the list's inception in 2010. We have twice been ranked number 1, were ranked number 2 in 2021 and are ranked number 6 for 2022. It is a testament to Prosperity's performance, culture, vision and consistency and distinguishes us among most banks" said David Zalman, Prosperity's Senior Chairman and Chief Executive Officer.

"I wish to congratulate and thank all our customers, associates and directors for helping us achieve this great honor," added Zalman.

"On a year-over-year basis, excluding Warehouse Purchase Program and Paycheck Protection Program ("PPP") loans, loans grew $409.3 million or 2.5% and deposits were up $2.3 billion or 8.0% for the same period. On a linked quarter basis, deposits increased $296.5 million or 3.9% annualized and loans were slightly down as we continue to see significant payoffs despite strong loan production," continued Zalman.

"Companies and individuals continue to move to Texas and Oklahoma primarily because of lower tax rates and a favorable pro-business political environment. The overall economy remains strong despite concerns around higher interest rates, inflation, supply chain issues and the war between Russia and Ukraine," stated Zalman.

"Prosperity has a talented team, deep bench, strong earnings, a solid capital position and a fortress balance sheet. We will continue working to help our customers and associates succeed and to build shareholder value," concluded Zalman.

Results of Operations for the Three Months Ended March 31, 2022

Net income was $122.3 million⁽²⁾ for the three months ended March 31, 2022 compared with $133.3 million⁽³⁾ for the same period in 2021. The change was primarily due to a decrease in loan interest income (including a decrease in PPP fees) and loan discount accretion of $11.1 million, partially offset by an increase in securities interest income and a decrease in interest expense. Net income per diluted common share was $1.33 for the three months ended March 31, 2022 compared with $1.44 for the same period in 2021. On a linked quarter basis, net income was $122.3 million⁽²⁾ for the three months ended March 31, 2022 compared with $126.8 million⁽⁴⁾ for the three months ended December 31, 2021. The change was primarily due to a decrease in loan interest income (including a decrease in PPP fees), partially offset by an increase in securities interest income. Net income per diluted common share was $1.33 for the three months ended March 31, 2022 compared with $1.38 for the three months ended December 31, 2021. Annualized returns on average assets, average common equity and average tangible common equity for the three months ended March 31, 2022 were 1.29%, 7.54% and 15.30%⁽¹⁾, respectively. Prosperity's efficiency ratio (excluding net gains and losses on the sale or write down of assets and securities) was 43.68%⁽¹⁾ for the three months ended March 31, 2022.

Net interest income before provision for credit losses for the three months ended March 31, 2022 was $239.9 million compared with $254.6 million for the same period in 2021. The change was primarily due to a decrease in the average balance and average rate on loans and a decrease in loan discount accretion of $11.1 million, partially offset by an increase in the average investment securities balance and a decrease in the average rate on interest-bearing liabilities. On a linked quarter basis, net interest income before provision for credit losses was $239.9 million compared with $244.8 million for the three months ended December 31, 2021.

The net interest margin on a tax equivalent basis was 2.88% for the three months ended March 31, 2022 compared with 3.41% for the same period in 2021. The change was primarily due to lower average rates on loans, a decrease in loan discount accretion of $11.1 million and an increase in the average balance on investment securities, partially offset by a decrease in the average rate on interest-bearing liabilities. On a linked quarter basis, the net interest margin on a tax equivalent basis was 2.88% for the three months ended March 31, 2022 compared with 2.97% for the three months ended December 31, 2021. The change was primarily due to lower average rates on loans and higher cash balances due to excess liquidity, partially offset by higher average balance and rates on investment securities.

Noninterest income was $35.1 million for the three months ended March 31, 2022 compared with $34.0 million for the same period in 2021, an increase of $1.1 million or 3.3%. This change was primarily due to an increase in nonsufficient funds fees, an increase in other noninterest income and a net gain on the sale of assets, partially offset by a decrease in mortgage income. On a linked quarter basis, noninterest income was $35.1 million compared with $35.8 million for the three months ended December 31, 2021.

Noninterest expense was $119.9 million for the three months ended March 31, 2022 compared with $119.1 million for the same period in 2021 and $119.5 million for the three months ended December 31, 2021.

Balance Sheet Information

At March 31, 2022, Prosperity had $38.271 billion in total assets, an increase of $2.713 billion or 7.6% compared with $35.558 billion at March 31, 2021.

Loans at March 31, 2022 were $18.068 billion, a decrease of $1.571 billion or 8.0%, compared with $19.639 billion at March 31, 2021, primarily due to a decrease in PPP, Warehouse Purchase Program and commercial real estate loans, partially offset by an increase in 1-4 family residential loans. Linked quarter loans decreased $548.6 million or 2.9% from $18.616 billion at December 31, 2021, primarily due to Warehouse Purchase Program loans. At March 31, 2022, Prosperity had $86.3 million of PPP loans compared to $1.139 billion of PPP loans at March 31, 2021 and $169.9 million of PPP loans at December 31, 2021. Excluding Warehouse Purchase Program and PPP loans, loans at March 31, 2022 were $16.637 billion compared to $16.227 billion at March 31, 2021, an increase of $409.3 million or 2.5%. Linked quarter loans, excluding Warehouse Purchase Program and PPP loans, decreased $33.8 million from $16.671 billion at December 31, 2021.

As part of its lending activities, Prosperity extends credit to oil and gas production and servicing companies. Oil and gas production loans are loans to companies directly involved in the exploration and/or production of oil and gas. Oil and gas servicing loans are loans to companies that provide services for oil and gas production and exploration. At March 31, 2022, oil and gas loans totaled $445.9 million (net of discount and excluding PPP loans totaling $17.0 million) or 2.5% of total loans, of which $251.5 million were production loans and $194.4 million were servicing loans, compared with total oil and gas loans of $503.9 million (net of discount and excluding PPP loans totaling $142.6 million) or 2.6% of total loans at March 31, 2021 of which $289.4 million were production loans and $214.5 million were servicing loans. In addition, as of March 31, 2022, Prosperity had total unfunded commitments to oil and gas companies of $417.0 million compared with total unfunded commitments to oil and gas companies of $248.1 million as of March 31, 2021. Unfunded commitments to producers include letters of credit issued in lieu of oil well plugging bonds.

Additionally, Prosperity extends credit to hotels and restaurants. At March 31, 2022, loans to hotels totaled $392.0 million (excluding PPP loans totaling $512 thousand) or 2.2% of total loans, a decrease of $9.2 million or 2.3%, compared with $401.2 million (excluding PPP loans totaling $13.1 million) or 2.0% of total loans at March 31, 2021. At March 31, 2022, loans to restaurants totaled $193.2 million (excluding PPP loans totaling $12.3 million) or 1.1% of total loans, a decrease of $15.5 million or 7.4%, compared with $208.7 million (excluding PPP loans totaling $125.2 million) or 1.1% of total loans at March 31, 2021.

Deposits at March 31, 2022 were $31.068 billion, an increase of $2.305 billion or 8.0%, compared with $28.763 billion at March 31, 2021. Linked quarter deposits increased $296.5 million or 1.0% (3.9% annualized) from $30.772 billion at December 31, 2021.

Asset Quality

Nonperforming assets totaled $27.2 million or 0.08% of quarterly average interest-earning assets at March 31, 2022, compared with $44.2 million or 0.15% of quarterly average interest-earning assets at March 31, 2021 and $28.1 million or 0.09% of quarterly average interest-earning assets at December 31, 2021.

The allowance for credit losses on loans and off-balance sheet credit exposures was $315.1 million at March 31, 2022 compared with $337.2 million at March 31, 2021 and $316.3 million at December 31, 2021.

The allowance for credit losses on loans was $285.2 million or 1.58% of total loans at March 31, 2022 compared with $307.2 million or 1.56% of total loans at March 31, 2021 and $286.4 million or 1.54% of total loans at December 31, 2021. Excluding Warehouse Purchase Program and PPP loans, the allowance for credit losses on loans to total loans was 1.71%⁽¹⁾ at March 31, 2022 compared with 1.89%⁽¹⁾ at March 31, 2021 and 1.72%⁽¹⁾ at December 31, 2021.

There was no provision for credit losses for the three months ended March 31, 2022, December 31, 2021 and March 31, 2021.

Net charge-offs were $1.2 million for the three months ended March 31, 2022, compared with net charge-offs of $8.9 million for the three months ended March 31, 2021 and net charge-offs of $807 thousand for the three months ended December 31, 2021. During the first quarter of 2022, net charge-offs did not include any purchased credit deteriorated ("PCD") loans and $553 thousand of specific reserves on resolved PCD loans was released to the general reserve.

Dividend

Prosperity Bancshares declared a first quarter cash dividend of $0.52 per share to be paid on July 1, 2022, to all shareholders of record as of June 15, 2022.

COVID-19 Pandemic

Prosperity continues to monitor the latest developments regarding COVID-19. As of March 31, 2022, pandemic-related restrictions on all business and activities in the states of Texas and Oklahoma remained lifted. The COVID-19 pandemic has resulted in significant economic uncertainties that have had, and could continue to have, an adverse impact on Prosperity's operating income, financial condition and cash flows.

Since the implementation of the Paycheck Protection Program in 2020, Prosperity has obtained SBA approvals on approximately 18,700 loans totaling $2.036 billion and, as of March 31, 2022, had an outstanding balance of 819 loans totaling $86.3 million.

Also, in response to the COVID-19 pandemic, Prosperity has provided relief to its loan customers through loan extensions and deferrals. Prosperity's troubled debt restructurings do not include loan modifications related to COVID-19. Beginning in mid-March of 2020, Prosperity began offering deferral and modification of principal and/or interest payments to selected borrowers on a case-by-case basis. As of March 31, 2022, Prosperity had approximately $29.0 million in outstanding loans subject to deferral and modification agreements.

Conference Call

Prosperity's management team will host a conference call on Wednesday, April 27, 2022, at 11:30 a.m. Eastern Time (10:30 a.m. Central Time) to discuss Prosperity's first quarter 2022 earnings. Individuals and investment professionals may participate in the call by dialing 877-883-0383 for domestic participants, or 412-902-6506 for international participants. The participant elite entry number is 4266827.

Alternatively, individuals may listen to the live webcast of the presentation by visiting Prosperity's website at www.prosperitybankusa.com. The webcast may be accessed from Prosperity's home page by selecting "Presentations, Webcasts & Calls" from the menu on the Investor Relations link and following the instructions.

Non-GAAP Financial Measures

Prosperity's management uses certain non-GAAP financial measures to evaluate its performance. Specifically, Prosperity reviews return on average tangible common equity; tangible book value per share; the tangible equity to tangible assets ratio; allowance for credit losses on loans to total loans excluding Warehouse Purchase Program and PPP loans; and the efficiency ratio excluding net gains and losses on the sale or write down of assets and securities, for internal planning and forecasting purposes. Prosperity believes these non-GAAP financial measures provide information useful to investors in understanding Prosperity's financial results and their presentation, together with the accompanying reconciliations, provides a more complete understanding of factors and trends affecting Prosperity's business and allows investors to view performance in a manner similar to management, the entire financial services sector, bank stock analysts and bank regulators. Further, Prosperity believes that these non-GAAP financial measures provide useful information by excluding certain items that may not be indicative of its core operating earnings and business outlook. These non-GAAP financial measures should not be considered a substitute for, nor of greater importance than, GAAP basis financial measures and results; Prosperity strongly encourages investors to review its consolidated financial statements in their entirety and not to rely on any single financial measure. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies' non-GAAP financial measures having the same or similar names. Please refer to the "Notes to Selected Financial Data" at the end of this Earnings Release for a reconciliation of these non-GAAP financial measures to the nearest respective GAAP financial measures.

Prosperity Bancshares, Inc. ®

As of March 31, 2022, Prosperity Bancshares, Inc.^® is a $38.271 billion Houston, Texas based regional financial holding company providing personal banking services and investments to consumers and businesses throughout Texas and Oklahoma. Founded in 1983, Prosperity believes in a community banking philosophy, taking care of customers, businesses and communities in the areas it serves by providing financial solutions to simplify everyday financial needs. In addition to offering traditional deposit and loan products, Prosperity offers digital banking solutions, credit and debit cards, mortgage services, retail brokerage services, trust and wealth management, and treasury management.

Prosperity currently operates 272 full-service banking locations: 65 in the Houston area, including The Woodlands; 30 in the South Texas area including Corpus Christi and Victoria; 62 in the Dallas/Fort Worth area; 22 in the East Texas area; 29 in the Central Texas area including Austin and San Antonio; 34 in the West Texas area including Lubbock, Midland-Odessa and Abilene; 16 in the Bryan/College Station area; 6 in the Central Oklahoma area; and 8 in the Tulsa, Oklahoma area.

Cautionary Notes on Forward-Looking Statements

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: This release contains, and the remarks by Prosperity's management on the conference call may contain, forward-looking statements within the meaning of the federal securities laws, including Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are typically, but not exclusively, identified by the use in the statements of words or phrases such as "aim," "anticipate," "estimate," "expect," "goal," "guidance," "intend," "is anticipated," "is expected," "is intended," "objective," "plan," "projected," "projection," "will affect," "will be," "will continue," "will decrease," "will grow," "will impact," "will increase," "will incur," "will reduce," "will remain," "will result," "would be," variations of such words or phrases (including where the word "could," "may," or "would" is used rather than the word "will" in a phrase) and similar words and phrases indicating that the statement addresses some future result, occurrence, plan or objective. Forward-looking statements include all statements other than statements of historical fact, including forecasts or trends, and are based on current expectations, assumptions, estimates and projections about Prosperity Bancshares and its subsidiaries. These forward-looking statements may include information about Prosperity's possible or assumed future economic performance or future results of operations, including future revenues, income, expenses, provision for loan losses, provision for taxes, effective tax rate, earnings per share and cash flows and Prosperity's future capital expenditures and dividends, future financial condition and changes therein, including changes in Prosperity's loan portfolio and allowance for loan losses, future capital structure or changes therein, as well as the plans and objectives of management for Prosperity's future operations, future or proposed acquisitions, the future or expected effect of acquisitions on Prosperity's operations, results of operations, financial condition, and future economic performance, statements about the anticipated benefits of the proposed transaction, and statements about the assumptions underlying any such statement, as well as expectations regarding the effects of the COVID-19 pandemic on Prosperity's operating income, financial condition and cash flows. These forward–looking statements are not guarantees of future performance and are subject to risks and uncertainties, many of which are outside of Prosperity's control, which may cause actual results to differ materially from those expressed or implied by the forward-looking statements. These risks and uncertainties include but are not limited to whether Prosperity can: successfully identify acquisition targets and integrate the businesses of acquired companies and banks; continue to sustain its current internal growth rate or total growth rate; provide products and services that appeal to its customers; continue to have access to debt and equity capital markets; and achieve its sales objectives. Other risks include, but are not limited to: the possibility that credit quality could deteriorate; actions of competitors; changes in laws and regulations (including changes in governmental interpretations of regulations and changes in accounting standards); the possibility that the anticipated benefits of an acquisition transaction, are not realized when expected or at all, including as a result of the impact of, or problems arising from, the integration of two companies or as a result of the strength of the economy and competitive factors generally; a deterioration or downgrade in the credit quality and credit agency ratings of the securities in Prosperity's securities portfolio; customer and consumer demand, including customer and consumer response to marketing; effectiveness of spending, investments or programs; fluctuations in the cost and availability of supply chain resources; economic conditions, including currency rate, interest rate and commodity price fluctuations; the effect, impact, potential duration or other implications of the COVID-19 pandemic; and weather. These and various other factors are discussed in Prosperity Bancshares' Annual Report on Form 10-K for the year ended December 31, 2021, and other reports and statements Prosperity Bancshares has filed with the Securities and Exchange Commission ("SEC"). Copies of the SEC filings for Prosperity Bancshares may be downloaded from the Internet at no charge from http://www.prosperitybankusa.com.

_______________
(1)	Refer to the "Notes to Selected Financial Data" at the end of this Earnings Release for a reconciliation of this non-GAAP financial measure to the nearest GAAP financial measure.
(2)	Includes purchase accounting adjustments of $4.1 million, net of tax, primarily comprised of loan discount accretion of $5.2 million for the three months ended March 31, 2022.
(3)	Includes purchase accounting adjustments of $13.2 million, net of tax, primarily comprised of loan discount accretion of $16.3 million for the three months ended March 31, 2021.
(4)	Includes purchase accounting adjustments of $4.2 million, net of tax, primarily comprised of loan discount accretion of $5.4 million for the three months ended December 31, 2021.

Bryan/College Station Area	Garland	Palestine	Magnolia	Texas Tech Student Union
Bryan	Grapevine	Rusk	Magnolia Parkway
Bryan-29^th Street	Grapevine Main	Seven Points	Mont Belvieu	Midland
Bryan-East	Kiest	Teague	Nederland	Wadley
Bryan-North	Lake Highlands	Tyler-Beckham	Needville	Wall Street
Caldwell	McKinney	Tyler-South Broadway	Rosenberg
College Station	McKinney Eldorado	Tyler-University	Shadow Creek	Odessa
Crescent Point	McKinney Redbud	Winnsboro	Spring	Grandview
Hearne	North Carrolton		Tomball	Grant
Huntsville	Park Cities	Houston Area	Waller	Kermit Highway
Madisonville	Plano	Houston	West Columbia	Parkway
Navasota	Plano-West	Aldine	Wharton
New Waverly	Preston Forest	Alief	Winnie	Other West Texas Area
Rock Prairie	Preston Parker	Bellaire	Wirt	Locations
Southwest Parkway	Preston Royal	Beltway		Big Spring
Tower Point	Red Oak	Clear Lake	South Texas Area -	Brownfield
Wellborn Road	Richardson	Copperfield	Corpus Christi	Brownwood
	Richardson-West	Cypress	Calallen	Cisco
Central Texas Area	Rosewood Court	Downtown	Carmel	Comanche
Austin	The Colony	Eastex	Northwest	Early
Allandale	Tollroad	Fairfield	Saratoga	Floydada
Cedar Park	Trinity Mills	First Colony	Timbergate	Gorman
Congress	Turtle Creek	Fry Road	Water Street	Levelland
Lakeway	West 15th Plano	Gessner		Littlefield
Liberty Hill	West Allen	Gladebrook	Victoria	Merkel
Northland	Westmoreland	Grand Parkway	Victoria Main	Plainview
Oak Hill	Wylie	Heights	Victoria-Navarro	San Angelo
Research Blvd		Highway 6 West	Victoria-North	Slaton
Westlake	Fort Worth	Little York	Victoria Salem	Snyder
	Haltom City	Medical Center
Other Central Texas Area	Hulen	Memorial Drive	Other South Texas Area	Oklahoma
Locations	Keller	Northside	Locations	Central Oklahoma Area
Bastrop	Museum Place	Pasadena	Alice	Oklahoma City
Canyon Lake	Renaissance Square	Pecan Grove	Aransas Pass	23^rdStreet
Dime Box	Roanoke	Pin Oak	Beeville	Expressway
Dripping Springs	Stockyards	River Oaks	Colony Creek	I-240
Elgin		Sugar Land	Cuero	Memorial
Flatonia	Other Dallas/Fort Worth Area	SW Medical Center	Edna
Georgetown	Locations	Tanglewood	Goliad	Other Central Oklahoma Area
Gruene	Arlington	The Plaza	Gonzales	Locations
Kingsland	Azle	Uptown	Hallettsville	Edmond
La Grange	Ennis	Waugh Drive	Kingsville	Norman
Lexington	Gainesville	Westheimer	Mathis
New Braunfels	Glen Rose	West University	Padre Island	Tulsa Area
Pleasanton	Granbury	Woodcreek	Palacios	Tulsa
Round Rock	Grand Prairie		Port Lavaca	Garnett
San Antonio	Jacksboro	Katy	Portland	Harvard
Schulenburg	Mesquite	Cinco Ranch	Rockport	Memorial
Seguin	Muenster	Katy-Spring Green	Sinton	Sheridan
Smithville	Runaway Bay		Taft	S. Harvard
Thorndale	Sanger	The Woodlands	Yoakum	Utica Tower
Weimar	Waxahachie	The Woodlands-College Park	Yorktown	Yale
	Weatherford	The Woodlands-I-45
Dallas/Fort Worth Area		The Woodlands-Research Forest	West Texas Area	Other Tulsa Area Locations
Dallas	East Texas Area		Abilene	Owasso
14th Street Plano	Athens	Other Houston Area	Antilley Road
Abrams Centre	Blooming Grove	Locations	Barrow Street
Addison	Canton	Angleton	Cypress Street
Allen	Carthage	Bay City	Judge Ely
Balch Springs	Corsicana	Beaumont	Mockingbird
Camp Wisdom	Crockett	Cleveland
Carrollton	Eustace	East Bernard	Lubbock
Cedar Hill	Gilmer	El Campo	4th Street
Coppell	Grapeland	Dayton	66th Street
East Plano	Gun Barrel City	Galveston	82nd Street
Euless	Jacksonville	Groves	86th Street
Frisco	Kerens	Hempstead	98^th Street
Frisco Warren	Longview	Hitchcock	Avenue Q
Frisco-West	Mount Vernon	Liberty	North University

Prosperity Bancshares, Inc.^® Financial Highlights (Unaudited) (In thousands)

	Mar 31, 2022		Dec 31, 2021		Sep 30, 2021		Jun 30, 2021		Mar 31, 2021
Balance Sheet Data (at period end)
Loans held for sale	$	2,810	$	7,274	$	10,197	$	9,080	$	20,991
Loans held for investment		16,720,173		16,833,171		16,949,486		17,147,146		17,345,506
Loans held for investment - Warehouse Purchase Program		1,344,541		1,775,699		1,998,049		2,095,559		2,272,389
Total loans		18,067,524		18,616,144		18,957,732		19,251,785		19,638,886

Investment securities^(A)		14,798,127		12,818,901		12,629,368		11,918,691		10,088,002
Federal funds sold		274		241		237		281		8,986
Allowance for credit losses on loans		(285,163)		(286,380)		(287,187)		(302,884)		(307,210)
Cash and due from banks		1,560,321		2,547,739		1,055,386		1,059,879		1,947,235
Goodwill		3,231,636		3,231,636		3,231,636		3,231,636		3,231,636
Core deposit intangibles, net		59,064		61,684		64,539		67,417		70,304
Other real estate owned		1,705		622		150		144		462
Fixed assets, net		336,075		319,799		322,799		324,502		326,970
Other assets		501,623		523,584		537,459		548,473		553,147
Total assets	$	38,271,186	$	37,833,970	$	36,512,119	$	36,099,924	$	35,558,418

Noninterest-bearing deposits	$	10,776,652	$	10,750,034	$	10,326,489	$	10,099,149	$	9,820,445
Interest-bearing deposits		20,291,658		20,021,728		19,125,163		19,011,092		18,942,660
Total deposits		31,068,310		30,771,762		29,451,652		29,110,241		28,763,105
Securities sold under repurchase agreements		440,891		448,099		440,969		433,069		377,106
Allowance for credit losses on off-balance sheet credit exposures		29,947		29,947		29,947		29,947		29,947
Other liabilities		227,614		156,926		244,110		216,330		166,414
Total liabilities		31,766,762		31,406,734		30,166,678		29,789,587		29,336,572
Shareholders' equity^(B)		6,504,424		6,427,236		6,345,441		6,310,337		6,221,846
Total liabilities and equity	$	38,271,186	$	37,833,970	$	36,512,119	$	36,099,924	$	35,558,418


(A)	Includes $2,115, $2,290, $2,483, $1,394 and $970 in unrealized gains on available for sale securities for the quarterly periods ended March 31, 2022, December 31, 2021, September 30, 2021, June 30, 2021 and March 31, 2021, respectively.
(B)	Includes $1,671, $1,809, $1,961, $1,101 and $766 in after-tax unrealized gains on available for sale securities for the quarterly periods ended March 31, 2022, December 31, 2021, September 30, 2021, June 30, 2021 and March 31, 2021, respectively.

Prosperity Bancshares, Inc.^® Financial Highlights (Unaudited) (In thousands)

	Three Months Ended
	Mar 31, 2022		Dec 31, 2021		Sep 30, 2021		Jun 30, 2021		Mar 31, 2021
Income Statement Data
Interest income:
Loans	$	193,025	$	206,209	$	213,821	$	216,803	$	233,075
Securities^(C)		55,011		46,857		46,217		43,708		38,677
Federal funds sold and other earning assets		847		563		302		340		351
Total interest income		248,883		253,629		260,340		260,851		272,103

Interest expense:
Deposits		8,754		8,685		11,578		15,288		17,362
Securities sold under repurchase agreements		185		184		195		164		159
Total interest expense		8,939		8,869		11,773		15,452		17,521
Net interest income		239,944		244,760		248,567		245,399		254,582
Provision for credit losses		—		—		—		—		—
Net interest income after provision for credit losses		239,944		244,760		248,567		245,399		254,582

Noninterest income:
Nonsufficient funds (NSF) fees		8,124		8,401		7,962		6,560		6,687
Credit card, debit card and ATM card income		8,179		8,894		8,837		8,918		8,031
Service charges on deposit accounts		6,211		6,237		6,115		6,062		5,978
Trust income		2,703		2,698		2,467		2,276		2,837
Mortgage income		455		685		1,396		2,914		3,307
Brokerage income		892		953		861		795		711
Bank owned life insurance income		1,283		1,317		1,325		1,294		1,292
Net gain (loss) on sale or write-down of assets		689		1,165		255		(244)		(79)
Other noninterest income		6,586		5,407		5,427		6,981		5,244
Total noninterest income		35,122		35,757		34,645		35,556		34,008

Noninterest expense:
Salaries and benefits		79,411		76,496		78,412		75,611		80,037
Net occupancy and equipment		7,848		8,140		8,165		8,046		7,833
Credit and debit card, data processing and software amortization		8,849		9,050		9,103		8,718		8,233
Regulatory assessments and FDIC insurance		2,850		2,801		2,497		2,670		2,670
Core deposit intangibles amortization		2,620		2,855		2,878		2,887		2,931
Depreciation		4,547		4,518		4,524		4,513		4,540
Communications		2,919		3,134		3,013		2,982		2,899
Other real estate expense		214		24		30		198		244
Net (gain) loss on sale or write-down of other real estate		(621)		2		4		(1,839)		(887)
Other noninterest expense		11,213		12,518		11,189		11,405		10,576
Total noninterest expense		119,850		119,538		119,815		115,191		119,076
Income before income taxes		155,216		160,979		163,397		165,764		169,514
Provision for income taxes		32,890		34,192		34,807		35,153		36,205
Net income available to common shareholders	$	122,326	$	126,787	$	128,590	$	130,611	$	133,309


(C)	Interest income on securities was reduced by net premium amortization of $12,857, $16,006, $15,141, $14,436 and $12,844 for the three months ended March 31, 2022, December 31, 2021, September 30, 2021, June 30, 2021 and March 31, 2021, respectively.

Prosperity Bancshares, Inc.^® Financial Highlights (Unaudited) (Dollars and share amounts in thousands, except per share data and market prices)

	Three Months Ended
	Mar 31, 2022				Dec 31, 2021			Sep 30, 2021			Jun 30, 2021			Mar 31, 2021

Profitability
Net income ^(D) (E)	$	122,326			$	126,787		$	128,590		$	130,611		$	133,309

Basic earnings per share	$	1.33			$	1.38		$	1.39		$	1.41		$	1.44
Diluted earnings per share	$	1.33			$	1.38		$	1.39		$	1.41		$	1.44

Return on average assets ^(F)		1.29	%			1.37	%		1.42	%		1.45	%		1.54	%
Return on average common equity ^(F)		7.54	%			7.91	%		8.07	%		8.31	%		8.60	%
Return on average tangible common equity ^(F) ^(G)		15.30	%			16.26	%		16.72	%		17.49	%		18.43	%
Tax equivalent net interest margin ^{(D) (E)} ^(H)		2.88	%			2.97	%		3.10	%		3.11	%		3.41	%
Efficiency ratio ^{(G) (I)}		43.68	%			42.79	%		42.34	%		40.96	%		41.25	%

Liquidity and Capital Ratios
Equity to assets		17.00	%			16.99	%		17.38	%		17.48	%		17.50	%
Common equity tier 1 capital		15.32	%	^(J)		15.10	%		14.84	%		15.26	%		14.60	%
Tier 1 risk-based capital		15.32	%	^(J)		15.10	%		14.84	%		15.26	%		14.60	%
Total risk-based capital		15.99	%	^(J)		15.45	%		15.20	%		15.71	%		15.07	%
Tier 1 leverage capital		9.44	%	^(J)		9.62	%		9.55	%		9.50	%		9.68	%
Period end tangible equity to period end tangible assets ^(G)		9.19	%			9.07	%		9.18	%		9.18	%		9.05	%

Other Data
Weighted-average shares used in computing earnings per common share
Basic		92,161				92,162			92,683			92,935			92,854
Diluted		92,161				92,162			92,683			92,935			92,854
Period end shares outstanding		92,160				92,170			92,160			92,935			92,929
Cash dividends paid per common share	$	0.52			$	0.52		$	0.49		$	0.49		$	0.49
Book value per common share	$	70.58			$	69.73		$	68.85		$	67.90		$	66.95
Tangible book value per common share ^(G)	$	34.87			$	34.00		$	33.09		$	32.40		$	31.42

Common Stock Market Price
High	$	80.46			$	78.67		$	72.97		$	78.06		$	83.02
Low	$	69.08			$	68.53		$	64.40		$	69.83		$	66.45
Period end closing price	$	69.38			$	72.35		$	71.13		$	71.80		$	76.16
Employees – FTE (excluding overtime)		3,595				3,704			3,625			3,724			3,724
Number of banking centers		272				273			273			274			275

(D) Includes purchase accounting adjustments for the periods presented as follows:
	Three Months Ended
	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021
Loan discount accretion
ASC 310-20	$4,674	$4,635	$3,761	$9,731	$13,313
ASC 310-30	$521	$731	$1,618	$2,462	$3,027
Securities net amortization	$52	$139	$136	$171	$111
Time deposits amortization	$100	$127	$201	$327	$507


(E)	Using effective tax rate of 21.2%, 21.2%, 21.3%, 21.2% and 21.4% for the three months ended March 31, 2022, December 31, 2021, September 30, 2021, June 30, 2021 and March 31, 2021, respectively.
(F)	Interim periods annualized.
(G)	Refer to the "Notes to Selected Financial Data" at the end of this Earnings Release for a reconciliation of this non-GAAP financial measure to the nearest GAAP financial measure.
(H)	Net interest margin for all periods presented is based on average balances on an actual 365-day basis.
(I)	Calculated by dividing total noninterest expense, excluding credit loss provisions, by net interest income plus noninterest income, excluding net gains and losses on the sale or write down of assets and securities. Additionally, taxes are not part of this calculation.
(J)	Beginning on January 1, 2022, the cumulative amount of the current expected credit loss ("CECL") transition adjustments will be phased in over a three-year transition period.

Prosperity Bancshares, Inc.^®

Financial Highlights (Unaudited)

(Dollars in thousands)

YIELD ANALYSIS