Prosperity Bancshares Inc., the parent company of Prosperity Bank, and Stellar Bancorp Inc., the parent holding company of Stellar Bank, headquartered in Houston, Texas, jointly announced the signing of a definitive merger agreement whereby Prosperity will acquire Stellar and Stellar Bank.
Stellar Bank operates 52 banking offices in greater Houston, Beaumont and surrounding areas and Dallas, Texas. As of Dec. 31, 2025, Stellar, on a consolidated basis, reported total assets of $10.807 billion, total loans of $7.301 billion and total deposits of $9.021 billion.
Under the terms and subject to the conditions of the definitive agreement, Prosperity will issue 0.3803 shares of Prosperity common stock and $11.36 in cash for each outstanding share of Stellar common stock. Based on Prosperity's closing price of $72.90 on Jan. 27, 2026, the total consideration was valued at approximately $2.002 billion.
Robert R. Franklin Jr., Stellar's Chief Executive Officer and Stellar Bank's Executive Chairman will join Prosperity Bank as Vice Chairman and Ramon Vitulli, Stellar's President and Stellar Bank's Chief Executive Officer, will join Prosperity Bank as Houston Area Chairman. Additional members of Stellar Bank management will maintain leadership roles in the combined organization.
In addition, upon completion of the merger, Franklin and one additional member of the Stellar Board of Directors will join the Board of Directors of Prosperity, and Vitulli and Pat Parsons, a director of Stellar Bank, will join the Board of Directors of Prosperity Bank.
"I am very excited to announce the merger of Stellar with Prosperity and to partner with Bob, Ray and the management team and other professionals of Stellar Bank," said David Zalman, Senior Chairman and Chief Executive Officer of Prosperity. The combination of our companies will create the second largest bank by deposits headquartered in Texas with over 330 banking centers. 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. Bob and Ray have extensive banking experience and we are looking forward to them joining our team and continuing to take Prosperity to the next level.
"Our banks have a complementary footprint, and we are familiar with and remain committed to the communities that Stellar Bank serves, including with both financial products and community support," continued Zalman.
"We are thrilled to announce this partnership with Prosperity," said Franklin. "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."
"I am incredibly proud of what our team has built, and I am excited about the opportunities this merger creates for our customers, employees, and communities. Together with Prosperity, we look forward to building an even more competitive and resilient financial institution for the future," continued Franklin.
The merger has been unanimously approved by the Boards of Directors of both companies and is expected to close during the second quarter of 2026, subject to the receipt of required regulatory approvals, approval by Stellar's shareholders and the satisfaction of other customary closing conditions.
Stellar is being advised by Keefe, Bruyette & Woods, a Stifel Company. as financial advisor, and Norton Rose Fulbright US, LLP, as legal counsel. Wachtell, Lipton, Rosen & Katz is serving as legal counsel to Prosperity.