Item 1A. Risk Factors
Risk Factors
An investment in the Company’s common stock involves risks. The following is a description of the material risks and uncertainties that the Company believes affect its business and an investment in its common stock. If any of the risks described below were to occur, our financial condition, results of operations and cash flows could be materially and adversely affected. If this were to happen, the value of the common stock could decline significantly and all or part of an investment could be lost.
Risks Related to Our Business
Our allowance for probable loan losses may be insufficient.
The determination of an appropriate level of loan loss allowance is an inherently complicated process and is based on numerous assumptions. This allowance represents management’s best estimate of probable losses that may exist within our existing loan portfolio. The determination of the appropriate level of the allowance for probable loan losses inherently involves a high degree of subjectivity and requires management to make significant estimates and assumptions regarding current credit risks and future trends, all of which may undergo material changes. In addition, if future charge-offs exceed the allowance for probable loan losses, we may need to increase the allowance for probable loan losses. Any increases in the allowance for probable loan losses will result in a decrease in net income and capital and may have a material adverse effect on our financial condition and results of operations.
Our adoption of ASU 2016-13, as amended, on January 1, 2020 impacted our methodology for estimating the allowance for credit losses. Adopting the CECL methodology pursuant to ASU 2016-03 increased our allowance for probable loan losses and resulted in a one-time cumulative-effect adjustment to retained earnings upon adoption. For additional information on the CECL methodology, see “Notes to Consolidated Financial Statements – (4) Allowance for Credit Losses” in our 2025 Annual Report to Shareholders, which is filed as Exhibit 13 hereto.
If real estate values in our target markets decline, the loan portfolio would be impaired.
A significant portion of our loan portfolio consists of loans secured by real estate located in the markets we serve. An adverse change in the economy affecting real estate values generally or in our target markets could significantly impair the value of collateral underlying certain of our loans and our ability to sell the collateral at a profit or at all upon foreclosure.
We operate in a highly competitive industry and market area.
We face substantial competition from a variety of different competitors in our market areas, many of which are larger and may have more financial resources. These competitors include national, regional, and community banks within the various markets we serve. We also face competition from many other types of financial institutions, including credit unions, finance companies, brokerage firms, insurance companies, factoring companies, and other financial intermediaries. Many of our competitors have fewer regulatory constraints and lower cost structures, which may allow them to offer better pricing on a broader range of products and services.
Further compounding the competition we face, technology and other changes are allowing parties to complete financial transactions that historically have involved banks through alternative, non-banking methods. The process of eliminating banks as intermediaries could result in the loss of fee income, as well as the loss of customer deposits and related income. Technology and other changes have lowered barriers to entry and made it possible for non-banks to offer products and traditionally offered by banks. In particular, the activity of financial technology companies (fintechs) has grown significantly over recent years and is expected to continue to grow. Fintechs have and may continue to offer bank or bank-like products and a number of fintechs have applied to bank or industrial loan charters. In addition, other fintechs have partnered with existing banks to allow them to offer deposit products to their customers. The loss of revenue streams and the reduction of lower cost deposits as a source of funds could have a material adverse effect on our financial condition
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and results of operations. In addition to the rise in fintechs, the financial-services industry has rapidly evolved with the rise of other alternative financial providers, including blockchain-based financial products and banking-as-a-service (BaaS) platforms, which offer digital banking products, mobile payment services, and decentralized financial services that compete with the services traditionally provided by banks.
The regulatory landscape for cryptocurrencies, decentralized finance, and fintech services remains uncertain and may create additional competitive challenges for traditional banks like ours.
The new presidential administration under President Donald Trump has embraced the adoption of digital assets and signaled more favorable federal regulation of cryptocurrencies and blockchain technologies aimed at ensuring the United States remains a global innovator in these areas. On January 23, 2025, President Trump signed an executive order entitled Strengthening American Leadership in Digital Financial Technology, which aims to “support the responsible growth and use of digital assets, blockchain technology, and related technologies across all sectors of the economy.” In alignment with the new executive order, the SEC announced a “Crypto 2.0” dedicated to developing a clear regulatory framework for crypto assets. Further signaling support for digital assets and cryptocurrency markets, on March 6, 2025, President Trump issued an executive order entitled Establishing of the Strategic Bitcoin Reserve and United States Digital Asset Stockpile, directing the Department of the Treasury to establish a Strategic Bitcoin Reserve and a federal stockpile of other digital assets held by the U.S. government.
If new regulations favor alternative financial products, we may face operational challenges and increased costs to remain competitive. Furthermore, if BaaS models continue to be more widely utilized by fintech companies to allow non-bank entities to expand into financial-service offerings, the need for traditional banking institutions may be reduced, which could cause us to experience a decline in customer acquisition and retention and increased pricing pressure in the financial-services industry. Additionally, as use of cryptocurrencies, blockchain technologies, and decentralized financial services gain broader regulatory approval, become more widely adopted by consumers, and become integrated into mainstream financial systems, we may be subject to additional competitive pressures from these alternative financial providers. which could reduce demand for the traditional banking services that we provide and draw customers away from traditional banking institutions like ours.
Customers, especially younger demographics, are increasingly embracing the use of digital wallets, crypto-based financial solutions, and peer-to-peer payment platforms as alternatives to traditional banking. A shift in customer preferences away from traditional deposit accounts and lending products may lead to a reduction in deposits, income generated through banking fees, and loan-origination opportunities, all of which could negatively impact our operations and ability to compete in the evolving financial-services industry.
Failure to successfully invest in, adapt to, integrate, and compete with technological developments, including new services and products that incorporate artificial intelligence (“AI”) into banking services and products, could impair our competitive position and adversely affect our business, revenue, and profitability.
The financial-services industry is experiencing rapid technological change driven by the advancement of AI. We may face a competitive disadvantage if we are unable to adopt and adapt to developing AI-driven technologies as quickly or effectively as our peers, larger financial institutions, and fintech companies, who are becoming increasingly involved in the banking and financial-services sectors. As customers grow to expect greater accessibility to AI banking solutions, including personalized financial-management tools, automated underwriting, and advanced fraud detection, failure to successfully invest in and incorporate AI into our banking offerings may cause us to fall short of meeting customer expectations for modernized, AI-powered financial services. To stay competitively relevant, we must leverage AI to enhance efficiency, risk management, and customer satisfaction. An inability to integrate AI solutions into our business and operations may make us unable to compete with institutions that can offer more sophisticated, technologically advanced financial products and services, which may hinder our rates of retaining and expanding our customer base. Furthermore, our revenue and profitability could be negatively impacted by the costs associated with enhancing our existing systems, upgrading our existing technologies and product offerings, and integrating AI tools into our business and operational structure.
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The development, adoption, and integration of AI in our banking services, processes, and products may subject us to increased technological risks, costs, uncertainties, and unpredictable outcomes while increasing our compliance costs and exposing us to new operational challenges.
AI-driven technologies are rapidly evolving and complex, and successfully integrating AI tools requires substantial investment, expertise, and continuous monitoring. Our adoption and implementation of AI tools into our banking services, processes, and products presents significant technological risks, uncertainties, and unpredictable outcomes that could result from errors or biases in AI models, data inconsistencies, compliance violations, unforeseen system failures, or operational disruptions. Flaws in our introduction and use of AI technologies could create unintended consequences, amplify our costs, and inadvertently expose us to security vulnerabilities and technological inefficiencies that could hamper the customer experience, negatively impact transaction processing, and undermine our risk-management processes.
Furthermore, as the use of AI continues to evolve in the banking industry, so too will the AI-related regulations governing the banking and financial-services sectors. Regulators may impose new compliance requirements concerning AI governance, model validation, ethical use of AI, cybersecurity, data privacy, and automated decision-making, which may increase our costs and administrative burdens and restrict our ability to utilize AI for banking services, such as customer engagement, credit underwriting, fraud detection, and other banking functions. Our ability to adopt new forms of technologies and AI may be thwarted by the emergence of complex industry-wide standards, uncertainties in the legislative and regulatory environment governing AI in banking, and difficulties in establishing proper governance and controls related to new AI technologies that are compliant with evolving regulatory requirements. Incorporating AI solutions and complying with emerging regulatory frameworks may require significant resources, time, and technological investment. Additionally, any errors in AI-based models that generate biased or inaccurate results could cause us to make uninformed business decisions based on faulty data, potentially leading to financial losses and operational inefficiencies, and to face regulatory scrutiny, reputational damage, or legal liability. Failure to comply with AI-related regulations or to effectively manage AI-related risks could adversely affect our business, financial condition, and results of operations.
External funding which we rely on, in part, to provide liquidity may not be available to us on favorable terms or at all.
Liquidity is the ability to meet cash flow needs on a timely basis at a reasonable cost. We rely on deposits, repurchase agreements, advances from the Federal Home Loan Bank (FHLB) of Dallas, the FHLB of Topeka and other borrowings to meet our liquidity demands. If we were unable to access any of these funding sources when needed, we might be unable to meet customers’ needs, which could adversely impact our financial condition, results of operations, cash flows and liquidity, and level of regulatory-qualifying capital. Our ability to borrow could also be impaired by factors that are not specific to us, such as a disruption in the financial markets or negative views and expectations about the prospects for the financial services industry.
Our earnings are subject to interest rate risk.
Interest rates are highly sensitive to many factors that are beyond our control, including general economic conditions such as inflation and unemployment rates, market forces like geopolitical tensions and investor sentiment, and policy decisions made by the Federal Reserve and other governmental and regulatory agencies. Changes in monetary policy, interest rates, the yield curve, or market-risk spreads, a prolonged inverted yield curve or instability in domestic or foreign financial markets could negatively influence the interest we receive on loans and securities, as well as the amount of interest we pay on deposits and borrowings. From March 2022 to July 2023, the Federal Reserve increased interest rates a total of eleven times, with the last hike occurring in July 2023 when target interest rates reached a range of 5.25% to 5.50%, with a benchmark rate at about 5.4%, the highest level in more than two decades. Although the Federal Reserve enacted six rate cuts in 2024 and 2025, reducing target interest rates to their current range of 3.50% to 3.75% by December 2025, the timing and extent of additional rate cuts remains uncertain. The Federal Reserve declined to implement additional rate cuts in January 2026. Volatility in interest rates may impact our net interest income and the valuation of our assets and liabilities. If the interest rates paid on deposits and other borrowings increase at a faster rate than the interest rates received on loans and other investments, our net interest income, and therefore earnings, could be adversely affected. Earnings could also be adversely affected if the interest rates received on loans and other investments fall more quickly than the
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interest rates paid on deposits and other borrowings. Any substantial, unexpected, or prolonged change in market interest rates could have a material adverse effect on our financial condition and results of operations.
We are subject to or may become subject to extensive government regulation and supervision.
Our operations are subject to extensive regulation by federal, state, and local governmental authorities and are subject to various laws and judicial and administrative decisions imposing requirements and restrictions on part or all of our operations. These regulations affect our lending practices, capital structure, investment practices, dividend policy, data and privacy protection policies, and growth, among other things. The statutory and regulatory framework under which we operate has changed substantially over the years and will likely continue to do so. These changes and other changes to statutes and regulations, including changes in the interpretation or implementation of statutes, regulations, or policies, could affect our operations in substantial and unpredictable ways. Such changes could subject us to additional costs, limit the types of financial services and products we may offer and/or increase the ability of non-banks to offer competing financial services and products. Failure to comply with laws, regulations, or policies could result in sanctions by regulatory agencies, civil money penalties and/or reputation damage, which could have a material adverse effect on our business, financial condition, and results of operations.
Our potential future acquisitions and branch expansion could be adversely affected by a number of factors.
Acquisitions of other financial institutions and branch expansion have been a key element of our growth in the past. There are a number of factors that may impact our ability to continue to grow through acquisition transactions, including strong competition from other financial institutions who are active or potential acquirers of financial institutions in our existing or future markets. Acquisitions of other financial institutions and new branches must be approved by bank regulators and such approvals are dependent on many factors, including the results of regulatory examinations and CRA ratings.
We rely heavily on our chief executive officer.
We have experienced substantial growth in assets and deposits, particularly since Dennis E. Nixon became our President in 1979. We do not have an employment agreement with Mr. Nixon and the loss of his services could have a material adverse effect on our business and prospects.
Our information systems may experience an interruption or breach in security.
We rely heavily on communications and information systems to conduct our business. Our products and services involve the gathering, storage, and transition of sensitive information regarding our customers and their accounts. While we conduct our own data processing, we are reliant on certain external vendors to provide products and services necessary to maintain our day-to-day operations. As a financial institution we are also subject to and examined for compliance with an array of data protection laws, regulations, and guidance, as well as our own internal privacy and information security policies and programs. If our information systems or infrastructure experience a significant disruption or breach, it could lead to unauthorized access to personal or confidential information of our customers in our possession and unauthorized access to our proprietary information, methodologies, and business secrets. Any failure, interruption, or breach in security of these systems could result in failures or disruptions in our customer relationship management, general ledger, deposit, loan, and other systems. In addition, if our partners, vendors, or other market participants experience a disruption or breach, it could lead to unauthorized transactions on our or our customer accounts, or unauthorized access to personal or confidential information maintained by those entities. The occurrence of any failures, interruptions, or security breaches of these information systems could damage our reputation, result in a loss of customer business, subject us to additional regulatory scrutiny, or expose us to civil litigation and possible financial liability, any of which could have a material adverse effect on our financial condition and results of operations.
Additional capital or funding to increase liquidity levels may not be available when needed or at all.
Our ability to raise additional capital, if needed, will depend on, among other things, conditions in the capital markets at that time, which are outside our control, and our financial performance. We have historically had access to a
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number of alternative sources of liquidity, but if there is an increase in volatility in the credit and liquidity markets, there is no assurance that we will be able to obtain such liquidity on terms that are favorable to us, or at all. If we were unable to access any of these funding sources when needed, we might be unable to meet customers’ needs, which could adversely impact our financial condition, results of operations, cash flows and liquidity, and level of regulatory-qualifying capital.
Our holding company relies on dividends from our Subsidiary Banks for most of our revenue.
Our holding company receives substantially all of our revenue from dividends from our Subsidiary Banks. These dividends are the principal source of funds to pay dividends on our common stock to shareholders of our holding company, as well as interest and principal on our holding company’s debt. Various federal and/or state laws and regulations limit the amount of dividends that our Subsidiary Banks may pay to our holding company. Our Subsidiary Banks’ ability to pay dividends to us is subject to, among other thing, their earnings, financial condition and need for funds, as well as federal and state governmental policies and regulations applicable to our holding company and Subsidiary Banks which limit the amount that may be paid as dividends without prior regulatory approval, including a statutory requirement that our holding company serve as a source of financial strength for our Subsidiary Banks. Although our holding company has historically declared semi-annual cash dividends on our common stock, we are not required to do so and may reduce or cease to pay common stock dividends in the future. If we reduce or cease to pay common stock dividends, the market price of our common stock could be adversely affected.
Severe weather, natural disasters, pandemics, acts of war or terrorism and other external events could significantly impact our business.
Severe weather, natural disasters, pandemics, acts of war or terrorism and other adverse external events could have a significant impact on our ability to conduct business. These events could affect the stability of our deposit base, impair the ability of borrowers to repay outstanding loans, impair the value of collateral securing loans, cause significant property damage, result in loss of revenue, and cause us to incur additional expenses. Although we have established disaster recovery policies and procedures, any such event(s) in, near, or affecting the markets we serve could have a material adverse effect on our business.
An impairment in the carrying value of our goodwill could negatively impact our earnings and capital.
Goodwill is initially recorded at fair value and is not amortized, but is reviewed for impairment at least annually or more frequently if events or changes in circumstances indicate that the carrying value may not be recoverable. If we experience disruption in our business, unexpected significant declines in our operating results, or sustained market capitalization declines, it could result in goodwill impairment charges in the future, which would be recorded as charges against earnings. We performed an annual goodwill impairment assessment as of October 1, 2025. Based on our analyses, we concluded that the fair value of our reporting units exceeded the carrying value of our assets and liabilities and, therefore, goodwill was not considered impaired. Depending on the response of the financial industry to the legal, regulatory, and competitive changes related to interchange fees, overdraft services and interest on demand deposit accounts, financial institutions may need to change their policies, procedures, and operating plans in the future to compete more effectively. Such changes may require certain financial institutions to take a goodwill impairment charge to account for anticipated reduction in revenue related to such changes, which could have a material adverse effect on our financial condition and results of operation.
We are subject to environmental liability risks as a result of certain lending activities.
A significant portion of our loan portfolio is secured by real property. During the ordinary course of business, we may foreclose on and take title to properties securing certain loans. There is a risk that hazardous or toxic substances could be found on these properties. If hazardous or toxic substances are found, we may be liable for remediation costs, as well as for personal injury and property damage. Environmental remediation may require us to incur substantial expenses and may materially reduce the affected property’s value or limit our ability to use or sell the affected property. In addition, future laws or more stringent interpretations or enforcement policies with respect to existing laws may increase our exposure to environmental liability. The remediation costs and any other financial liabilities associated with an environmental hazard could have a material adverse effect on our financial condition and results of operations.
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Our controls and procedures may fail or be circumvented.
Our management is responsible for establishing and maintaining adequate internal control over financial reporting and for evaluating and reporting on its system of internal controls. While management regularly reviews and updates our internal controls, disclosure controls and procedures, and corporate governance policies and procedures, any failure or circumvention of our controls and procedures or failure to comply with regulations related to controls and procedures could have a material adverse effect on our business, results of operations and financial condition.
New lines of business or new products and services may subject us to additional risks.
From time to time, we may implement new lines of business or offer new products and services within existing lines of business. In developing and marketing new lines of business and/or new products and services, we may invest considerable time and resources. Initial timetables for the introduction and development of new lines of business and/or new products may not be achieved, and price and profitability targets may not prove feasible. Compliance with regulations, competitive alternatives, and shifting market preferences, may also impact the successful implementation of a new line of business or a new product or service. Failure to successfully manage these risks in the development and implementation of new lines of business or new products or services could have a material adverse effect on our business, results of operations and financial condition.
Our accounting estimates and risk management processes rely on analytical and forecasting tools and models.
The processes we use to estimate probable loan losses and to measure the fair value of financial instruments, as well as the processes used to estimate the effects of changing interest rates and other market measures on our financial condition and results of operations, depends upon the use of analytical tools and forecasting models. These tools and models reflect assumptions that may not be accurate, particularly in times of market stress or other unforeseen circumstances. Even if these assumptions are adequate, the tools or models may prove to be inadequate or inaccurate because of other flaws in their design or their implementation. Any such failure in our analytical or forecasting tools or models could have a material adverse effect on our business, financial condition, and results of operations.
We may be adversely affected by declining crude oil prices.
Decreased market oil prices compress margins for many U.S., Texas, and Oklahoma-based oil producers, particularly those that utilize higher-cost production technologies such as hydraulic fracking and horizontal drilling, as well as oilfield service providers, energy equipment manufacturers and transportation suppliers, among others. Energy production and related industries represent a large part of the economies in some of our primary markets. Furthermore, a prolonged period of low oil prices could also have a negative impact on the U.S. economy and, in particular, the economies of energy dominant states such as Texas and Oklahoma. Accordingly, a prolonged period of low oil prices could have a material adverse effect on our business, financial condition, and results of operation.
Risks Related to the Company’s Industry
Our success depends significantly on economic conditions in the local markets in which we operate.
Our success depends, to a certain extent, on local, national, and international economic and political conditions and local, as well as governmental monetary policies. We are particularly affected by conditions in our primary market areas of south, central, and southeast Texas, including Austin, Dallas and Houston, the State of Oklahoma and Mexico. If economic conditions in these market areas weaken or worsen due to a decline in oil prices or other factors, or fail to improve or to continue to improve, we could experience an increase in loan delinquencies and non-performing assets, decreases in loan collateral values and a decrease in demand for our products and services, any of which could have a material adverse impact on our financial condition and results of operations.
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We depend on the accuracy and completeness of information about customers and counterparties as well as the soundness of other financial institutions.
In deciding whether to extend credit or enter into other transactions, we may rely on information furnished by or on behalf of customers and counterparties, including financial statements, credit reports and other financial information. We also rely on representations of those customers, counterparties, financial institutions or other third parties, such as independent auditors, as to the accuracy and completeness of that information. Reliance on inaccurate or misleading financial statements, credit reports or other financial information or problems with the soundness of other financial institutions with which we interact could have a material adverse impact on our business and our financial condition and results of operations.
If we do not adjust to rapid changes in the financial services industry, our financial performance may suffer.
Our ability to deliver strong financial performance and returns on investment to shareholders will depend in part on our ability to expand the scope of available financial services to meet the needs and demands of our customers and our ability to stay abreast of technological innovations and evaluate those technologies that will enable us to compete on a cost-effective basis. In addition to traditional banks, our competitors also include securities dealers, brokers, mortgage bankers, investment advisors, specialty finance and insurance companies who seek to offer one-stop financial services that may include services that banks have not been able or allowed to offer to their customers in the past. The continued competitive environment in our industry is primarily a result of changes in regulation, technology, and product delivery systems, and the accelerating pace of consolidation among financial service providers. Changes in the financial industry may result in the loss of fee income, as well as the loss of customer deposits and the related income generated from those deposits. The loss of these revenue streams and the lower cost deposits as a source of funds could have a material adverse effect on our financial condition and results of operations. Further, the costs of new technology, including personnel, can be high in both absolute and relative terms. There can be no assurance, given the fast pace of change and innovation, that our technology will meet or continue to meet our operational needs and the needs of our customers.
We are subject to claims and litigation pertaining to intellectual property.
Banking and other financial services companies, including us and our Subsidiary Banks, rely on technology companies to provide information technology products and services necessary to support our day-to-day operations. Technology companies frequently enter into litigation based on allegations of patent infringement or other violations of intellectual property rights. Such claims may increase in the future as the financial services sector becomes more reliant on information technology vendors. The plaintiffs in these actions frequently seek injunctions and substantial damages.
Regardless of the scope or validity of such patents or other intellectual property rights, or the merits of any claims by potential or actual litigants, we may have to engage in protracted litigation. Such litigation is often expensive, time-consuming, disruptive to our operations, and distracting to management. If legal matters related to intellectual property claims were resolved against us, we could be required to make payments in amounts that could have a material adverse effect on its business, financial condition, and results of operations.
Our financial condition, results of operation and stock price may be negatively impacted by negative publicity risk, diminished depositor confidence in depository institutions, and the increased threat of bank-run contagion.
A total of five FDIC-insured banks failed between March to November 2023, three of which occurred during a less than two-month period from March to May 2023, four more banks failed from 2024 to 2025, and one bank has failed thus far in 2026. The collapse of those banks, coupled with lingering fears of an economic downturn and market instability, have eroded customer confidence in the banking system and caused widespread market volatility among publicly traded bank holding companies. The collapse of those banks, the resulting coverage by media organizations, and the rapid spread through social media of negative sentiments concerning the banking industry have caused customers to doubt the safety and soundness of financial institutions, especially regional and community banks, and created a threat of bank-run contagion. Our reputation and the confidence our customers have in our business may be damaged by adverse publicity and negative information regarding the wider financial-services industry generally. As a result, customers may choose to maintain deposits with larger financial institutions, to remove their deposits from the banking system altogether, or to
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invest in higher yielding, short-term fixed-income securities, which could adversely impact our liquidity, loan funding capacity, net interest margin, and results of operations. Although we have amplified our efforts to promote deposit insurance coverage with our customers, to proactively communicate with our customers in order to address any depository fears they may be experiencing as a result of the unrelated bank failures, and to implement policies for effectively managing our liquidity, deposit portfolio retention and other related matters, our financial condition, results of operation and stock price may be adversely affected by future negative events within the banking industry and negative customer or investor responses to such events.
Recent volatility in the banking industry could prompt new legislation, regulations, and policy changes that could cause us to be subjected to additional regulatory oversight and supervision.
Negative developments in the banking industry from 2023 through 2025, culminating in the failures of multiple banks, prompted responses by the FDIC, the Federal Reserve, and the U.S. Treasury Secretary to protect the depositors of those failed institutions and to attempt to reinstate diminished public confidence in depository institutions. Congress and federal banking regulators have also intervened by initiating investigations into the root causes of the failures in an attempt to both understand and hold accountable the parties and policies responsible for the rapid banking crisis. Ultimately, congressional and regulatory oversight and supervision may result in the imposition of new legislation, regulations, and policy changes aimed at tightening risk-management practices, heightening standards for managing interest rate and liquidity risks, and minimizing financial contagion. While we cannot predict with certainty what interventions and initiatives legislators and regulatory agencies may pursue, any of the changes described above could affect our operations in substantial and unpredictable ways. Such changes could be subject to additional costs, limit the types of financial services and products we may offer, and/or increase the ability of non-banks to offer competing financial services and products. Failure to comply with laws, regulations, or policies could result in sanctions by regulatory agencies, civil money penalties and/or reputation damage, which could have a material adverse effect on our business, financial condition, and results of operations.
The Dodd-Frank Act, the powers of the CFPB, and the FDIC Overdraft Payment Supervisory Guidance may increase the likelihood of lawsuits against financial institutions.
The Dodd-Frank Act provides that courts must make preemption determinations on a case-by-case basis with the respect to particular state laws and can no longer rely on blanket preemption determinations. Also, the CFPB is authorized to protect consumers from “unfair,” “deceptive” and “abusive” acts and practices. Depending on the future actions of the CFPB, the likelihood of lawsuits against financial institutions related to allegedly “unfair,” “deceptive” and “abusive” acts and practices could increase. Moreover, the costs related to such lawsuits would be significantly increased if the CFPB restricts the use of arbitration and/or class action waivers in consumer banking contracts.
The imposition of new or increased international tariffs may have a material adverse effect on our business, financial condition, and results of operations.
We do a significant amount of business for customers domiciled in Mexico, with an emphasis in Northern Mexico. Deposits from persons and entities domiciled in Mexico comprise a large and stable portion of the deposit base of our Subsidiary Banks, and some of our Subsidiary Banks are highly active in facilitating international trade along the United States border with Mexico and elsewhere. The imposition of tariffs and trade restrictions by the United States on Mexico may weaken the Mexican economy, reduce cross-border trade, and ultimately negatively impact the financial wellbeing of our customer base in Mexico, potentially leading to lower deposit balances or increased withdrawals from our depositors domiciled in Mexico. In turn, a decline in our deposit base and liquidity could strain our ability to compete with other financial institutions that are less reliant on cross-border deposits. Furthermore, in response to any increase in geopolitical tensions or strained U.S.–Mexico relations, depositors from Mexico may seek alternative financial institutions that they consider to be more integrated within the Mexican financial industry, which could cause us to face increased competition. Declined economic activity in Mexico and cross-border trade resulting from the imposition of tariffs and trade restrictions may lead to lower deposit balances, increase the likelihood of loan defaults, and reduce the demand for the banking products and services that our Subsidiary Banks provide to customers domiciled in Mexico, reducing the circulating of money in our border communities as well as the major cities in Texas.
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Macroeconomic conditions could have a material adverse effect on our business, results of operations, and financial condition.
Unfavorable macroeconomic conditions, including low productivity growth, declining business investment, inflationary pressures, fluctuating interests rates, concerns regarding the imposition of tariffs (including retaliatory tariffs in response to tariffs imposed by the United States), concerns regarding the level of U.S. debt, shifts in monetary and fiscal policy, strained international trade relations, and heightened geopolitical pressures, could negatively impact our business, results of operations, and financial condition. Economic downturns may cause reduced consumer and business banking activity, lower loan demand, increased credit risk, and higher loan deficiencies. Trade policies like tariffs and retaliatory measures, as well as geopolitical tensions in the U.S. and global markets, may cause disruptions to economic stability, affect businesses that participate in international trade, and increase market volatility.
Economic and inflationary pressure on consumers and prolonged uncertainty in the macroeconomic environment could result in changes in the spending, borrowing, and savings habits of consumers and businesses and may also weaken investor confidence, reduce capital markets activity, and increase regulatory scrutiny, all of which could have a material adverse effect on our business, financial condition, and results of operations.
Risks Related to the Company’s Stock
The trading price of our common stock may be volatile.
The trading price of our common stock has fluctuated over time due in part to actual or anticipated variations in our earnings, changes in government regulations, policies and guidance, news reports of trends, concerns and other issues related to the financial services industry, operating and stock performance of our peer companies, new technology used or services offered by traditional and non-traditional competitors, continued low trading volume in our common stock and the impact of short-selling activity in our common stock. Moreover, general market price declines or market volatility in the future could adversely affect the trading price of our common stock.
The holders of our junior subordinated debentures have rights that are senior to those of our shareholders.
As of December 31, 2025, we had approximately $108 million in junior subordinated debentures outstanding that were purchased by our statutory trusts using the proceeds from the sale of trust preferred securities to third party investors. The junior subordinated debentures are senior to our shares of common stock. Payments of the principal and interest on the trust preferred securities are conditionally guaranteed by us to the extent not paid or made by each trust. We must make payments on the junior subordinated debentures (and the related trust preferred securities) before any dividends can be paid on our common stock. While we have the right to defer interest payments on the junior subordinated debentures at any time no dividends may be paid to holders of our common stock during any such deferral, which could cause the trading price of our stock to decline.
Item 1B. Unresolved Staff Comments
N/A
Item 1C. Cybersecurity
Risk Management and Strategy
As a financial institution in today’s digital landscape, we understand that cybersecurity and data protection are of paramount importance to our business, our customers, and our reputation. With the proliferation of online banking and the digitalization of financial services, we recognize that our policies and procedures for safeguarding sensitive customer data must be as sophisticated as the cyber threats we are defending against. Accordingly, cybersecurity is a high-priority component of our overall risk-management system and risk-control infrastructure. We have implemented robust, multi-layer security procedures and defense strategies that aim to proactively mitigate cyber risks, enable our early detection and
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prevention of security incidents, minimize our vulnerability to attacks, and protect us from both internal and external cybersecurity threats.
Commensurate with the risks we face and the sensitivity of the data and systems we are protecting, our Information Systems Security Program (ISSP) includes layers of administrative and technical safeguards designed to protect the confidentiality and integrity of sensitive information belonging to us and our employees, partners, and customers, to guard against the unauthorized access, alteration, disclosure, or destruction of that information, and to defend that information from potential, known, emerging, and evolving security risks. Our ISSP also applies to cybersecurity and data protection risks associated with artificial intelligence, including generative artificial intelligence whether those risks arise from our use of AI solutions or from AI-enabled threats and attack techniques used by malicious actors. We have established multiple control points within our security infrastructure to reduce the risks associated with embedded technologies that could fail or be manipulated by nefarious actors, to prevent the intentional and unintentional infiltration of cybersecurity threats, and to maximize their separation from our sensitive information systems and assets. In developing our ISSP, our policies, standards, and procedures were heavily informed by and incorporated provisions from various sources of statutory and regulatory guidance as well as numerous leading industry frameworks, including the NIST Cybersecurity Framework, various NIST special publications, the Fair Information Practice Principles established by the Federal Privacy Council, the Privacy Management Framework developed by the American Institute of Certified Public Accountants, and the Center for Internet Security’s Critical Security Controls.
As part of our ISSP and strategy for managing cybersecurity risks, we have adopted the following cybersecurity policies:
Some of the steps we have taken and processes we have implemented to assess, identify, and manage material risks from cybersecurity threats include the following:
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Furthermore, our IT security infrastructure and cybersecurity policies are designed to monitor and manage security risks associated with any third-party service providers, suppliers, software and hardware vendors, contractors, and consultants we collaborate with (hereinafter, collectively, Vendors) who might store, process, collect, share, create, transmit, destroy, or access any of our sensitive data. Our Vendor Management Policy establishes clearly defined requirements of engagements with Vendors and requires them to uphold similar security standards to those we internally require. Depending on their risk level, we may subject certain Vendors to heightened security requirements, such as enhanced risk assessments, ongoing monitoring, or additional contractual controls to restrict their levels of information access.
Governance
Security Council Committee. As part of our cybersecurity governance framework and for purposes of establishing and maintaining our ISSP, we have established an SCC, which consists of members of our management team and IT department. The SCC is subject to oversight by the Service Center Board, the Risk Committee, and the Board. The Risk Committee of the Board works directly with the SCC to develop and implement our policies and procedures concerning cybersecurity and data protection. As stated in the Risk Committee Charter, our Risk Committee reviews management reports on the adequacy of our data-governance activities and IT security program; evaluates risks related to customer information, significant outsourcing with third parties or Vendors, and operational outsourcing arrangements; reviews, evaluates, and updates our data-governance framework, processes, and systems for identifying, assessing, and managing data risks that impact critical business operations; and reviews and evaluates our overall risk-management framework.
The SCC meets at least quarterly to discuss its oversight of our cybersecurity policies and procedures, risk-management practices and controls, and efforts to mitigate and prevent cybersecurity risks. The SCC may meet more frequently if required by our Incident Response Plan to facilitate timely response, monitoring, risk-management, and recovery efforts. The SCC is also charged with periodically reporting to management, the Board, and the Risk Committee, the status, and results of our compliance with our security program, results of security assessments, and effectiveness of remediation activities.
Other Committees. In addition to the SCC and Risk Committees, we have established a Technology Committee, a Senior Management Committee, and a Business Continuity and Disaster Recovery (BC/DR) Committee. Each oversees aspects of our ISSP and coordinates with the SCC to implement various cybersecurity procedures. We have also implemented an enterprise AI governance framework, which provides cross-functional oversight of AI solutions across the Company, including the IT and Vendor Management Departments.
Chief Information Security Officer. In addition to establishing the SCC and other committees, we designated a Chief Information Security Officer (CISO) to oversee all aspects of our IS policies, procedures, and controls. Our CISO reports to our Senior and Executive Management Committee, the SCC, the Risk Committee, and the Chairman of the Board. At least annually, the CISO presents all of our IS policies to the Board. The CISO is also tasked with maintaining an effective Security Awareness Program and providing training to our management, Board, and employees on an annual basis. Additionally, the CISO meets with our Audit Committee on a quarterly basis to inform them of material cybersecurity-related regulatory updates and with our full Board on a monthly basis to discuss and provide pertinent regulatory information.
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Procedures Governing our Cybersecurity Incident Responses. Our multi-layered, cross-functional approach to cybersecurity governance provides adequate checks and balances on the implementation of our cybersecurity protocols, enables us to effectively monitor both internal and external cyber risks, and allows for the swift escalation of any potential cybersecurity incidents to the appropriate levels of management so that assessments concerning materiality, potential disclosure, and possible responsive actions can be timely made. Our approach to cybersecurity governance is modeled in the Incident Response Team (IRT) that we have established to timely address cybersecurity incidents and minimize any disruptions to our business operations and customer activities caused by cyber threats or attacks. Designated IRT personnel are available 24 hours per day, seven days per week to respond to potential incidents. Having an integrated team for incident response facilitates information sharing, which allows organizational personnel, including developers, implementers, and operators, to leverage the team knowledge of the threat in order to implement defensive measures that will deter intrusions more effectively. In the event of a potential cybersecurity incident, our IRT is responsible for implementing our Security Incident Response Policy, in accordance with which the following steps occur:
Procedures Governing our Third-Party Vendor Relationships. Similar to our governance approach with respect to responding to cybersecurity incidents, we have implemented a layered, collaborative governance system to manage our third-party vendor relationships and to implement our Vendor Management Policy. Prior to working with any vendor, we conduct a comprehensive security screening to evaluate the vendor’s security protocols and identify any potential vulnerabilities that could compromise our sensitive data. At least annually, we also perform a security assessment of the vendor to identify any change in the vendor’s security posture that may negatively impact the security of our information systems. Our CISO or other designated IS personnel oversees and makes a final recommendation regarding the vendor security assessments, determines the necessity of vendor site visits, and coordinates and provides a final report on any site visit that occurs. Our vendor relationships are monitored by our Vendor Management Department, the day-to-day operations of which are led by our Vendor Manager. In coordination with the applicable Business Unit Manager, the Vendor Manager categorizes and ranks the risks presented by our vendors, performs vendor due diligence, and provides periodic reports to our Board and Risk Committee concerning vendor risk management. Before entering into any vendor contract, the Business Unit Manager that will be contracting for the vendor’s service or product must perform a thorough
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risk evaluation. In addition to working alongside the Vendor Manager to categorize and rank vendor risks, the Business Unit Manager participates in contract review and negotiations, establishes performance-monitoring controls, and completes vendor reviews. The CISO or other designated IS personnel may participate with the Business Unit Manager in contract negotiations as needed.
Procedures Governing our Corporate Account Takeover Responses. Like our approaches to responding to cybersecurity incidents and managing our vendor relationships, our strategy for managing corporate account takeover (CATO) threats integrates organizational operations at multiple governance levels involving our Board, executive management team, members of our Senior Management of Electronic Banking Services (EBS Management Team), an Electronic Banking Services Manager (EBS Manager), and our CISO. Our Board reviews our CATO Policy for compliance with the Texas Department of Banking standards for the risk management of CATOs and charges our EBS Management Team with the responsibility of determining necessary courses of action to ensure adherence to applicable guidance and regulations. Our EBS Management Team also ensures that our CATO Policy is understood and complied with across all of our operational divisions. Some of the responsibilities of our EBS Manager include developing, implementing, and maintaining policies and procedures to comply with our CATO Policy, coordinating the performance of period risk assessments of IBC Link, our online banking product, establishing trainings for IBC Link customers regarding security controls that mitigate CATO risks, reporting CATO incidents to executive management, and coordinating with our management team and IBC Link customers if an actual or threatened CATO attack is identified. Our CISO is responsible for ensuring appropriate security controls are implemented to prevent, detect, and respond to CATOs, establishing incident-response procedures to be employed if a CATO threat is in progress, and timely notifying our primary federal regulator of any CATO incidents that are required to be disclosed to comply with applicable laws, regulations, and CATO Policy procedures.
Notwithstanding the robust nature of our defensive measures and security processes and the multi-layered governance system that we have established to mitigate, monitor, analyze, and respond to incidents, cybersecurity threats are increasingly difficult to detect, and the risk of a data breach or cyber-attack is pervasive and severe. While we do not believe our business strategy, results of operations, or financial condition have been materially adversely affected by any cybersecurity threats or incidents, there is no assurance that we will not be materially affected by such threats or incidents in the future. We will continue to monitor cybersecurity risks, stay apprised of changes in the cyber environment, and invest in strengthening our cybersecurity infrastructure. For additional information on our risks related to cybersecurity, please see “Risk Factors—Risks Related to Our Business—Our information systems may experience an interruption or breach in security.”
Item 2. Properties
Our principal offices are located at 1200 San Bernardo Avenue, Laredo, Texas and 2418 Jacaman Road, Laredo, Texas in buildings we own and completely occupy and containing approximately 147,000 square feet. The Subsidiary Banks have main banking and branch facilities. All the facilities are customary to the banking industry. The Subsidiary Banks own most of their banking facilities and the remainder are leased. The facilities are located in the regions of Laredo, San Antonio, Austin, Dallas, Houston, Zapata, Eagle Pass, the Rio Grande Valley of Texas, the Coastal Bend area of Texas, and throughout the State of Oklahoma.
None of our Texas state chartered Subsidiary Banks, without the prior written consent of the Texas Banking Commissioner, may invest in an amount in excess of its Tier 1 capital in bank facilities, furniture, fixtures and equipment. Our Oklahoma state chartered Subsidiary Bank, without the prior written consent of the Oklahoma Banking Commissioner, may not invest in an amount in excess of its Tier 1 and Tier 2 capital in bank facilities, furniture, fixtures and equipment. None of the Subsidiary Banks exceeds such applicable limitation.
Item 3. Legal Proceedings
We and our subsidiaries are involved in various legal proceedings that are in various stages of litigation. We and our subsidiaries have determined, based on discussions with our counsel that any material loss in such actions, individually or in the aggregate, is remote or the damages sought, even if fully recovered, would not be considered material to our consolidated financial position or results of operations. Many of these matters are in various stages of proceedings and
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further developments could cause management to revise our assessment of these matters. Further information regarding legal proceedings has been provided in Note 15 of the Notes to Consolidated Financial Statements located on page 65 of the 2025 Annual Report to Shareholders, which is filed as Exhibit 13 hereto and incorporated herein by reference.
Item 4. Mine Safety Disclosures
None
Part II
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
The information set forth under the caption “Common Stock and Dividends,” “Stock Repurchase Program,” and “Equity Compensation Plan Information” located on pages 23 and 25 of our 2025 Annual Report is incorporated herein by reference.
Item 6. [Reserved]
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
The information set forth under the caption “Management’s Discussion and Analysis of Financial Condition and Results of Operations” located on pages 2 through 23 of our 2025 Annual Report is incorporated herein by reference.
Item 7A. Quantitative and Qualitative Disclosures about Market Risk
The information set forth under the caption “Liquidity and Capital Resources” located on pages 15 through 20 of our 2025 Annual Report is incorporated herein by reference.
Item 8. Financial Statements and Supplementary Data
The consolidated financial statements located on pages 27 through 78 of our 2025 Annual Report are incorporated herein by reference.
The condensed quarterly income statements located on pages 79 and 80 of our 2025 Annual Report are incorporated herein by reference.
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
None.
Item 9A. Controls and Procedures
As of the end of the period covered by this Annual Report on Form 10-K, an evaluation was carried out by our management with the participation of our Chief Executive Officer and Chief Accounting Officer, of the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934). Based upon that evaluation, the Chief Executive Officer and Chief Accounting Officer concluded that the disclosure controls and procedures were effective as of the end of the period covered by this report. Additionally, there were no changes in our internal control over financial reporting (as defined in Rule 13a15(f) under the Securities Exchange Act of 1934) that occurred during the quarter ended December 31, 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
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Management’s Report on Internal Control Over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal controls over financial reporting, as defined under Rules 13a-15(f) and 15d-15(f) of the Securities Exchange Act of 1934. Our internal control over financial reporting is a process designed under the supervision of our Chief Executive Officer and Chief Financial Officer to provide reasonable assurance regarding the reliability of financial reporting and the preparation of our financial statements for external purposes in accordance with generally accepted accounting principles.
As of December 31, 2025, management assessed the effectiveness of the design and operation of our internal controls over financial reporting based on the criteria for effective internal control over financial reporting established in “Internal Control—Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission in 2013. Based on the assessment, management determined that we maintained effective internal control over financial reporting as of December 31, 2025, based on those criteria.
RSM US LLP, the independent registered public accounting firm that audited our 2025 consolidated financial statements included in this Annual Report on Form 10-K, has audited the effectiveness of our internal controls over financial reporting as of December 31, 2025. Their report, which expresses an unqualified opinion, on the effectiveness of our internal controls over financial reporting as of December 31, 2025 is included in this Item under the heading “Report of Independent Registered Public Accounting Firm.”
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Report of Independent Registered Public Accounting Firm
Shareholders and the Board of Directors
International Bancshares Corporation
Opinion on the Internal Control Over Financial Reporting
We have audited International Bancshares Corporation and its subsidiaries' (the Company) internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission in 2013. In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission in 2013.
We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated statements of condition as of December 31, 2025 and 2024, the related consolidated statements of income, comprehensive income, shareholders' equity and cash flows for each of the three years in the period ended December 31, 2025, and the related notes to the consolidated financial statements of the Company and our report dated February 26, 2026 expressed an unqualified opinion.
Basis for Opinion
The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting in the accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also included performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.
Definition and Limitations of Internal Control Over Financial Reporting
A company's internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the company's assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
/s/ RSM US LLP
Austin, Texas
February 26, 2026
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Item 9B. Other Information
During the quarter ended December 31, 2025, none of the Company’s directors or officers adopted, modified, orterminated a “Rule 10b5-1 trading arrangement” or a “non-Rule 10b5-1 trading arrangement,” as those terms are defined in Item 408(a) of Regulation S-K.
Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections
None.
Part III
Item 10. Directors, Executive Officers, and Corporate Governance
Certain information is set forth in the following table concerning the executive officers of the Company, each of whom has been elected to serve until the 2026 Annual Meeting of Shareholders and until his or her successor is duly elected and qualified.
Name Age Position of Office Officer oftheCompanySince
There are no family relationships among any of the named persons. Each executive officer has held the same position or another executive position with our holding company, or our lead Subsidiary Bank, IBC Laredo during the past five years.
There is also incorporated in this Item 10 by reference to our definitive proxy statement relating to our 2026 Annual Meeting of Shareholders those portions entitled (i) “ELECTION OF DIRECTORS,” (ii) “Audit Committee” in the portion entitled “MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS,” (iii) “Code of Ethics,” in the portion entitled “CORPORATE GOVERNANCE,” and (iv) “DELINQUENT SECTION 16(a) REPORTS.”
The Company has adopted a Statement of Company Policy on Securities Trades by Directors, Officers and Employees of the Company, which promotes compliance with insider trading laws, rules, and regulations, and the listing standards applicable to the Company. A copy of our policy is attached as Exhibit 19 hereto.
Item 11. Executive Compensation
There is incorporated in this Item 11 by reference to our definitive proxy statement relating to our 2026 Annual Meeting of Shareholders (i) that portion entitled “EXECUTIVE COMPENSATION,” and (ii) that portion entitled “Compensation Committee and Stock Option Plan Committee Interlocks and Insider Participation” in the portion entitled “MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS.”
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Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
There are incorporated in this Item 12 by reference those portions of our definitive proxy statement relating to the Company’s 2026 Annual Meeting of Shareholders entitled “PRINCIPAL SHAREHOLDERS,” “SECURITY OWNERSHIP OF MANAGEMENT,” and “Equity Compensation Plan Information” in the portion entitled “EXECUTIVE COMPENSATION.”
Item 13. Certain Relationships and Related Transactions, and Director Independence
There is incorporated in this Item 13 by reference to our definitive proxy statement relating to our 2026 Annual Meeting of Shareholders (i) that portion entitled “INTEREST OF MANAGEMENT IN CERTAIN TRANSACTIONS” and (ii) that portion entitled “Director Independence” in the portion entitled “CORPORATE GOVERNANCE.”
Item 14. Principal Accountant Fees and Services
There is incorporated in this Item 14 by reference that portion of our definitive proxy statement relating to our 2026 Annual Meeting of Shareholders entitled “PRINCIPAL ACCOUNTANT FEES AND SERVICES.”
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Part IV
Item 15. Exhibits, Financial Statement Schedules
(a) Documents
Reports of Independent Registered Public Accounting Firm (PCAOB ID: 49)
(3a)* —Articles of Incorporation of International Bancshares Corporation.
(4) —Description of the Registrant’s Securities.
(10a)*+ —The 1996 International Bancshares Corporation Stock Option Plan.
(10b)*+ —2005 International Bancshares Corporation Stock Option Plan.
(10e)*+ —2012 International Bancshares Corporation Stock Option Plan.
(10f)*+ —International Bancshares Corporation 2013 Management Incentive Plan.
(23) —Consent of Independent Registered Public Accounting Firm
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(97)* —International Bancshares Corporation Compensation Clawback Policy
101++ —Interactive Data File
104++ —Cover Page Interactive Data File
* Previously filed
+ Executive Compensation Plans and Arrangements
Item 16. Form 10-K Summary
None
Exhibit Index
Exhibit 4— Description of Registrant’s Securities
Exhibit 23— Consent of Independent Registered Public Accounting Firm
Exhibit 101— Interactive Inline Data File
Exhibit 104— Cover Page Inline Interactive Data File
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
INTERNATIONAL BANCSHARES CORPORATION(Registrant)
By: /s/ Dennis E. NixonDennis E. NixonPresident
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed by the following persons on behalf of the Registrant and in the capacities and on the date indicated.
Signatures Title Date
/s/ Javier de andaJavier de Anda Director February 26, 2026
/s/ Doug HowlandDoug Howland Director February 26, 2026
/s/ Rudolph M. MilesRudolph M. Miles Director February 26, 2026
/s/ Larry NortonLarry Norton Director February 26, 2026
/s/ Roberto resendezRoberto Resendez Director February 26, 2026
/s/ Antonio R. Sanchez, Jr.Antonio R. Sanchez, Jr. Director February 26, 2026
/s/ Diana G. ZunigaDiana G. Zuniga Director February 26, 2026
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