Cullen/Frost Announces Pricing of $150 Million Preferred Stock Offering and Entry Into Accelerated Share Repurchase Agreement

 Cullen/Frost Announces Pricing of $150 Million Preferred Stock Offering and
              Entry Into Accelerated Share Repurchase Agreement

PR Newswire

SAN ANTONIO, Feb. 12, 2013

SAN ANTONIO, Feb. 12, 2013 /PRNewswire/ --Cullen/Frost Bankers, Inc. (NYSE:
CFR) ("Cullen/Frost") today announced the pricing of a public offering of
6,000,000 shares, or $150 million in aggregate liquidation preference, of its
5.375% non-cumulative perpetual preferred stock, Series A, which qualifies as
Tier 1 capital. The preferred stock has a liquidation preference of $25 per
share. The offering is expected to close on February 15, 2013, subject to
customary closing conditions.


Morgan Stanley, Goldman, Sachs & Co. and UBS Investment Bank are the
joint-book running managers for the offering.

The net proceeds from the issuance and sale of the preferred stock, after
deducting underwriting discount and commissions, and the payment of estimated
expenses, will be approximately $144.5 million. Cullen/Frost intends to use
the net proceeds from the offering to repurchase $144.0 million of shares of
its common stock pursuant to an accelerated share repurchase ("ASR") agreement
it has entered into today with Goldman, Sachs & Co. Under the terms of the
ASR agreement, Cullen/Frost will pay $144.0 million to Goldman, Sachs & Co. on
February 15, 2013 and in exchange will receive shares of its common stock,
with the substantial majority of shares expected to be delivered on February
15, 2013 and any additional shares expected to be delivered upon completion of
the program. The total number of shares that Cullen/Frost will receive and
the total consideration paid ultimately will be determined based on the
volume-weighted daily average price of its common stock during the repurchase

This press release does not constitute an offer to sell or a solicitation of
an offer to buy, nor shall there be any sale of any of the securities in any
jurisdiction in which such offer, solicitation or sale would be unlawful prior
to registration or qualification under the securities laws of any such
jurisdiction. The securities being offered have not been approved or
disapproved by any regulatory authority, nor has any such authority passed
upon the accuracy or adequacy of the prospectus supplement or the shelf
registration statement or prospectus.

The offering is being made only by means of a prospectus supplement and
accompanying base prospectus. Cullen/Frost has filed a registration statement
(including a base prospectus) and a preliminary prospectus supplement with the
U.S. Securities and Exchange Commission (the "SEC") for the offering to which
this communication relates and will file a final prospectus supplement
relating to the offering. Prospective investors should read the prospectus
supplement and base prospectus in that registration statement and other
documents Cullen/Frost has filed or will file with the SEC for more complete
information about Cullen/Frost and this offering. You may get these documents
for free by visiting EDGAR on the SEC's website at
Alternatively, copies of the final prospectus supplement and the accompanying
base prospectus for the offering, when available, may be obtained by
contacting Morgan Stanley & Co. LLC (Attention Prospectus Department, 180
Varick Street, New York, NY 10014, or by email at; Goldman, Sachs & Co. (Prospectus Department,
200 West Street, New York, NY 10282, telephone: 1-866-471-2526, facsimile:
212-902-9316 or by emailing; and UBS Securities
LLC (299 Park Avenue, New York, NY 10171, Attention: Prospectus Specialist,
telephone: 877-827-6444, ext. 561 3884).

About Cullen/Frost Bankers, Inc.

Cullen/Frost Bankers, Inc. (NYSE: CFR) is a financial holding company,
headquartered in San Antonio, with $23.1 billion in assets at December 31,
2012. Among the top 50 largest U.S. banks and one of 24 banks included in the
KBW Bank Index, Frost provides a wide range of banking, investments and
insurance services to businesses and individuals across Texas in the Austin,
Corpus Christi, Dallas, Fort Worth, Houston, Rio Grande Valley and San Antonio
regions. Founded in 1868, Frost has helped clients with their financial needs
during three centuries.

Forward-Looking Statements and Factors that Could Affect Future Results

Certain statements contained in this press release that are not statements of
historical fact constitute forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995 (the "Act"),
notwithstanding that such statements are not specifically identified as such.
In addition, certain statements may be contained in the corporation's future
filings with the SEC, in press releases, and in oral and written statements
made by or with the approval of the corporation that are not statements of
historical fact and constitute forward-looking statements within the meaning
of the Act. Examples of forward-looking statements include, but are not
limited to: (i) projections of revenues, expenses, income or loss, earnings or
loss per share, the payment or nonpayment of dividends, capital structure and
other financial items; (ii) statements of plans, objectives and expectations
of Cullen/Frost or its management or Board of Directors, including those
relating to products or services; (iii)statements of future economic
performance; and (iv) statements of assumptions underlying such statements.
Words such as "believes", "anticipates", "expects", "intends", "targeted",
"continue", "remain", "will", "should", "may" and other similar expressions
are intended to identify forward-looking statements but are not the exclusive
means of identifying such statements.

Forward-looking statements involve risks and uncertainties that may cause
actual results to differ materially from those in such statements. Factors
that could cause actual results to differ from those discussed in the
forward-looking statements include the factors described in our Annual Report
on Form 10-K for the year ended December 31, 2012.

Forward-looking statements speak only as of the date on which such statements
are made. The corporation undertakes no obligation to update any
forward-looking statement to reflect events or circumstances after the date on
which such statement is made, or to reflect the occurrence of unanticipated

Greg Parker
Investor Relations
Renee Sabel
Media Relations

SOURCE Cullen/Frost Bankers, Inc.

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