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The South Plains Financial IPO: What You Need To Know

Elizabeth Balboa

A new regional bank joins the market Thursday. Here’s what you should know about the potential investment:

The IPO

South Plains Financial, Inc. will issue 3.38 million shares on the Nasdaq under ticker SPFI, according to the firm’s S-1 filing. Priced between $17.50 and $19.50, the offering represents 19.3 percent of outstanding shares and is expected to bring in about $75.8 million. (Update: The IPO was priced at $17.50 per share.)

Lead underwriters include Sander O’Neill and Partners, as well as Keefe, Bruyette and Woods.

The company qualifies as an emerging growth company under the U.S. JOBS Act, which exempts management from certain SEC disclosure requirements.

The Company

Since 1993, South Plains has served as a bank holding company for City Bank Texas, Lockney Holding Company and Zia Financial Corp.

Its 21 banks and 13 loan offices provide insurance, investment, trust and mortgage services to commercial and retail clients across Texas and New Mexico. At the end of 2018, it had $2.7 billion assets under management, with $2 billion in gross loans and $2.3 billion in deposits. Shareholder equity amounted to $154.6 million.

The Finances

Management closed out 2018 with a five-year growth rate of 11.9 percent in net income and 7.1 percent in loans.

The year ended with $95.6 million in net interest income compared with the previous year’s rate of $88.5 million. Fee income represented 35.3 percent of revenue.

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