Company: SFNC
Filing Date: 2025-11-06
Form Type: 10-Q
Source: 0001628280-25-050112
Chunk: 8

Company: SIMMONS FIRST NATIONAL CORP
Filing Date: 2025-11-06
Form: 10-Q
Item: Part I, Item 2
Chunk 8
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 million decrease in interest expense on time deposits and a $7.7 million decrease in interest expense related to other borrowings during the quarter. Of the $8.2 million decrease in interest expense on time deposits, $1.4 million was due to the 14 basis point decrease in average rates on time deposits and $6.8 million was due to the decrease in time deposit volume over the period. These changes were primarily due to a reduction of higher rate, non-relationship wholesale and public fund deposits, as well as higher rate other borrowings, as part of the balance sheet repositioning. 

Net Interest Income - Year-over-Year Analysis

Net interest income on a fully taxable equivalent basis for the nine month period ended September 30, 2025 increased $55.6 million, or 11.5%, over the same period in 2024. The increase in net interest income on a fully taxable equivalent basis was the result of a $52.5 million decrease in fully tax equivalent interest income, more than offset by a $108.2 million decrease in interest expense.

The decrease in interest income during the nine month period ended September 30, 2025 primarily resulted from decreases in interest income on loans and investments. The decrease in interest income on loans was largely attributable to a 10 basis point decline in loan yield that resulted in a decrease of $13.8 million, while the incremental decrease in loan volume over the comparative periods led to a decrease of $4.2 million. The decrease of $37.4 million in interest income on investment securities is primarily related to a $33.6 million decrease in interest income on investment securities due to the decline in our investment portfolio average balances, which decreased by $1.24 billion or 18.6%, primarily related to the balance sheet repositioning previously discussed, coupled with pay downs, maturities and a strategic sale of $251.5 million of lower-yielding AFS securities to pay off higher rate wholesale fundings consisting of Federal Home Loan Bank (“FHLB”) advances during the third quarter of 2024. A yield decrease in the taxable investment portfolio over the period of 18 basis points led to a decrease of $5.5 million in interest income on taxable investment securities.

The $108.2 million decrease in interest expense is mainly due to the decrease in our deposit account rates over the period. Interest expense decreased $64.1 million due to the decrease in rate of 55 basis points on interest-bearing deposit accounts.