Texas-based Prosperity Bancshares has agreed to acquire Stellar Bancorp and its subsidiary Stellar Bank in a deal valued at around $2bn.
As per the agreed terms, Prosperity will offer 0.3803 shares of its common stock along with $11.36 in cash for each Stellar share.
The deal expands the foothold of Prosperity Bancshares, the parent of Prosperity Bank, in its home market.
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Stellar Bank currently runs 52 branches in the greater Houston area, Beaumont, surrounding regions, and Dallas, Texas.
As of 31 December 2025, Stellar reported consolidated assets of $10.81bn, loans of $7.3bn, and deposits of $9.02bn.
The merger is set to create the second largest Texas-based bank, with assets of approximately $54bn.
The boards of both companies have approved the merger unanimously.
Completion is targeted for the second quarter of 2026, subject to regulatory review, approval from Stellar shareholders and other standard conditions.
Prosperity senior chairman and CEO David Zalman said: “The combination of our companies will create the second largest bank by deposits headquartered in Texas with over 330 banking centres. Together, our increased scale better positions us to invest in future opportunities and serve our customers. Stellar and its predecessors have been serving the Houston and Beaumont, Texas areas for many years.
“This is a rare opportunity to significantly enhance our presence in the Houston area, a market with a diverse economy that is continually attracting investment and has a growing population.”
Leadership changes are expected as part of the merger.
Stellar CEO and Stellar Bank executive chairman Robert R. Franklin, Jr. will join Prosperity Bank as vice chairman.
Stellar president and Stellar Bank CEO Ramon Vitulli will move to Prosperity Bank as Houston area chairman.
Other members from Stellar’s management are also set to remain in leadership positions following the merger.
Besides, Franklin and another member from the Stellar Board will join Prosperity’s Board of Directors, while Vitulli and Pat Parsons, currently a director at Stellar Bank will join the Board at Prosperity Bank.
Franklin said: “By joining forces, we are creating one of the strongest Texas banking franchises, supported by an exceptional deposit base and a shared commitment to relationship-driven community banking.
“This combination enhances our ability to serve customers with greater scale, expanded capabilities, and the financial strength needed to meet the evolving needs of a growing Texas economy.”
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