Texas

Lending margins are once again contracting thanks to a confluence of factors, and bankers are doing everything from shifting cash into higher-risk securities to reconfiguring branches to pad profits.

Count BBVA Compass as another bank that has suffered this year from bad energy loans.

The $1.8 billion-asset Sunflower expects to combine with the $2.2 billion-asset Strategic Growth to create a company with $3 billion in loans and 60 branches in Colorado, Kansas, Missouri, New Mexico and Texas.

Some midsize banks found ways to widen margins, and Texas lenders said weakness in the energy sector has had little effect on the broader Texas economy. But can those trends hold up?

The energy sector downturn led to lower second-quarter profit at Prosperity Bancshares in Houston, which continued to shrink the size of its book of oil and gas loans in response.

Cullen/Frost Bankers' second-quarter profit declined slightly compared with a year earlier as gains in net interest income were largely offset by increased chargeoffs and a higher provision for loan losses.

LegacyTexas Financial Group in Plano has met its original purpose of becoming a big player in its home market.

The recent rise in oil prices and a surge in loan demand helped Texas Capital Bancshares in Dallas bounce back in the second quarter.

Panic around energy lending has subsided somewhat as oil prices have climbed and banks have reduced their overall exposure. But expect more trouble ahead if prices level off.

Comerica reported improvement in its energy-loan portfolio in the second quarter but charges related to a broad corporate restructuring took a bite out of overall profits.