A ballooning of its loan-loss provision cut into profits at Prosperity Bancshares in Houston.

First-quarter net income at the $22 billion-asset company fell 6.4% to $69 million year over year and earnings per share fell 6.7% to 98 cents.

Net interest income after the provision for credit losses fell 5.8% to $152.3 million. The provision was $14 million, versus $1.3 million in the first quarter of 2015. The net interest margin narrowed by 9 basis points to 3.48%.

Total nonperforming assets rose 61% to $57 million, and net chargeoffs rose to $11.7 million from $1 million. The bulk of the chargeoffs came from a $7 million agricultural loan and two energy loans totaling $6 million. Prosperity acquired all three loans with its January purchase of Tradition Bancshares in Houston.

Total loans rose 5.3% to $9.7 billion on expanded lending for commercial real estate, construction projects and residential mortgages. Prosperity reduced its energy loan book to $363 million, or 3.8% of total loans, from $462 million, or 5%.

“Despite the downturn in the oil and gas industry, the unemployment rates in Texas and Oklahoma remain strong,” Chairman and CEO David Zalman said in a press release Wednesday. “Obviously, parts of Texas are impacted more than others,” but “other parts of Texas and Oklahoma are doing well.”

Noninterest income rose 8.3% to $30.8 million on higher deposit service charges and higher mortgage income.

Noninterest expense rose 1.3% to $80.5 million on higher costs for card processing, data processing and software amortization. The efficiency ratio improved 75 basis points to 41.08%.

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