South Plains Financial Inc. (NASDAQ:SPFI), a regional bank holding company based in Lubbock, Texas, saw its stock price plummet by 8.85% on Wednesday morning following the release of its third-quarter earnings report for 2024. The mixed results highlighted both positive and negative developments for the company, leaving investors uncertain about its future prospects.

On the positive side, South Plains Financial reported a significant increase in deposits, growing by approximately $95 million or more than 10% annualized in the third quarter. The company also maintained a strong market position, being number one in deposit share in the Lubbock market with an 18% share. Additionally, South Plains Financial's credit quality remained solid, with no adverse trends observed in the third quarter and a resolution in place for a previously nonaccrual multifamily loan in Houston.

However, the earnings report also revealed several challenges faced by the company. Loans held for investment declined by approximately $57 million during the third quarter due to loan payoffs and a managed decline in the indirect auto portfolio. Noninterest income decreased to $10.6 million from $12.7 million in the previous quarter, primarily due to a decrease in mortgage banking revenues. Furthermore, the company's third quarter earnings were negatively impacted by $0.03 per share after tax due to a decrease in the fair value adjustment of mortgage servicing rights.