The looming fiscal cliff has spurred Southside Bancshares (SBSI) of Tyler, Tex., to pay out more of its profits to shareholders.
The $3.2 billion-asset parent company of Southside Bank declared Friday it will pay owners of its common stock a special dividend of 13 cents a share for 2012 and a one-time dividend of 20 cents that will be separate from its regular dividend of 20 cents.
Southside said concerns that tax rate on dividends could rise next year unless lawmakers come to a fiscal deal spurred its decision to declare the one-time payment now. The company joins other cash-rich banks that have decided to return capital to shareholders ahead of the possible increase
"We are pleased that our business plan has produced solid results during the nine months ended September 30, 2012," Sam Dawson, Southside's chief executive, said in a news release. "Due to the achievement of these results, the Board believes it is appropriate to share a portion of this success."
Southside also said its board has authorized a plan to purchase up to $10 million of the company's stock.
The company said it expects to pay the combined 53 cents a share dividend on Dec. 6 to shareholders of record on Nov. 21.
Southside earned $26.5 million in the nine months that ended Sept. 30, down 10.5% from a year earlier. The drop resulted primarily from higher provisions for loan losses; a decrease in both gains on the sale of securities and impairment charges; and higher operating expenses.