First Financial Bankshares (FFIN) 8-K First Financial Bankshares Announces Fourth Quarter Results

EXHIBIT 99.1

For immediate release	For More Information:
	J. Bruce Hildebrand, Executive Vice President
	325.627.7155

FIRST FINANCIAL BANKSHARES ANNOUNCES
FOURTH QUARTER RESULTS

Texas-based company records its 21^st consecutive year of increased earnings

ABILENE, Texas, January 24, 2008 – First Financial Bankshares, Inc. (NASDAQ: FFIN) today reported earnings for the fourth quarter of 2007 of $12.51 million, a 6.8 percent increase compared with earnings of $11.71 million in the same quarter last year. Basic earnings per share increased 7.1 percent to $0.60, compared with $0.56 in the same period last year.

Net interest income for the fourth quarter of 2007 increased 8.5 percent to $29.25 million compared with $26.97 million in the same quarter last year. The provision for loan losses was $1.38 million in the fourth quarter of 2007, up from $247,000 in the same quarter last year to keep pace with loan growth and in light of a slowing national economy. Non-performing assets as a percentage of loans and foreclosed assets totaled 31 basis points at December 31, 2007, compared to 47 basis points at September 30, 2007, and 30 basis points at December 31, 2006. The net interest margin, on a taxable equivalent basis, improved to 4.50 percent for the fourth quarter of 2007 from 4.43 percent in the same period a year ago and from 4.45 percent in the third quarter of 2007.

Noninterest income in the fourth quarter of 2007 was $12.39 million compared with $11.05 million in the same quarter last year. Trust fees increased 5.9 percent in the fourth quarter of 2007 to $2.22 million compared with $2.09 million in the same quarter last year due to continued growth of trust assets managed. Real estate mortgage fees declined slightly to $723,000 in the fourth quarter of 2007 compared to $759,000 in the same quarter last year. ATM and credit card fees increased 21.1 percent to $2.0 million versus $1.66 million a year ago, indicative of continued increased use of debit cards and the growth in net new accounts.

Noninterest expense increased 7.6 percent in the fourth quarter of 2007 to $22.73 million from $21.12 million in the same quarter last year. The largest component of this increase is salaries and employee benefits, reflecting higher levels of contributions to the Company’s profit sharing plan and healthcare expenses. The Company’s efficiency ratio in the fourth quarter of 2007 stood at 52.78 percent compared with 53.90 percent in the same quarter a year ago.

The Company reported its 21^st consecutive year of increased earnings. Net income for the year rose 7.5 percent to $49.49 million from $46.03 million in 2006. Basic earnings

per share increased 7.2 percent for 2007 to $2.38 from $2.22 the previous year. Net interest income increased 4.7 percent for the year to $110.81 million from $105.87 million in 2006. The provision for loan losses was $2.33 million for 2007 compared with $2.06 million the previous year.

“We are pleased to report another good quarter and year for our Company and our shareholders,” said F. Scott Dueser, Chairman, President and Chief Executive Officer. “In the fourth quarter, we continued to grow loans, trust fees and ATM fees and improved our net interest margin. We feel fortunate to operate in Texas markets where the economy remained strong in 2007 and looks promising for 2008, even though the national economy may be slowing. In light of the national economy, we will proceed with caution to maintain our credit quality and margin.”

As of December 31, 2007, consolidated assets for the Company totaled $3.07 billion compared with $2.85 billion a year ago. Loans increased 11.2 percent to $1.53 billion at year’s end, compared with loans of $1.37 billion a year ago. Total deposits at year’s end stood at $2.55 billion, up from $2.38 billion a year earlier. Noninterest bearing deposits increased $53.8 million from a year ago. In addition, repurchase agreement balances with customers totaled $154.3 million at December 31, 2007 compared to $94.2 million a year ago, as our treasury management services continue to grow. Shareholders’ equity rose to $335.50 million as of December 31, 2007, compared with $300.90 million the prior year.

Headquartered in Abilene, Texas, First Financial Bankshares is a financial holding company that operates ten separately chartered banks with 45 locations in Texas. The bank subsidiaries are First Financial Bank, N.A., Abilene, Clyde, Moran and Albany; First Financial Bank, N.A., Eastland, Ranger and Rising Star; First Financial Bank, N.A., Cleburne, Burleson, Alvarado and Midlothian; Hereford State Bank, Hereford; First Financial Bank, N.A., Mineral Wells; San Angelo National Bank, San Angelo; First Financial Bank, N.A., Southlake, Trophy Club, Keller, Bridgeport, Decatur and Boyd; First Financial Bank, N.A., Stephenville, Granbury and Glen Rose; First National Bank, Sweetwater, Roby and Trent; and Weatherford National Bank, Weatherford, Willow Park and Aledo. The Company also operates First Financial Trust & Asset Management Company, N.A., with five locations and First Technology Services, Inc., a technology operating company.

The Company is listed on The NASDAQ Global Select Market under the trading symbol FFIN. For more information about First Financial Bankshares, please visit our Web site at http://www.ffin.com.

*****

Certain statements contained herein may be considered “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. These statements are based upon the belief of the Company’s management, as well as assumptions made beyond information currently available to the Company’s management, and may be, but not necessarily are, identified by such words as “expect”, “plan”, “anticipate”, “target”, “forecast” and “goal”. Because such “forward-looking statements” are subject to risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. Factors that could cause actual results to differ materially from the Company’s expectations include competition from other financial institutions and financial holding companies; the effects of and changes in trade, monetary and fiscal policies and laws, including interest rate

policies of the Federal Reserve Board; changes in the demand for loans; fluctuations in value of collateral and loan reserves; inflation, interest rate, market and monetary fluctuations; changes in consumer spending, borrowing and savings habits; and acquisitions and integration of acquired businesses, and similar variables. Other key risks are described in the Company’s reports filed with the Securities and Exchange Commission, which may be obtained under “Investor Relations-Documents/Filings” on the Company’s Web site or by writing or calling the Company at 325.627.7155. Except as otherwise stated in this news announcement, the Company does not undertake any obligation to update publicly or revise any forward-looking statements because of new information, future events or otherwise.

FIRST FINANCIAL BANKSHARES, INC.
CONSOLIDATED FINANCIAL SUMMARY (UNAUDITED)
(In thousands, except share and per share data)

	December 31,
	2007			2006
ASSETS:
Cash and due from banks	$	165,438		$	128,492
Fed funds sold		99,450			64,485
Investment securities		1,128,493			1,129,313
Loans		1,528,020			1,373,735
Allowance for loan losses		(17,462	)		(16,201	)
Net loans		1,510,558			1,357,534
Premises and equipment		61,670			59,467
Goodwill		62,112			62,112
Other intangible assets		3,095			4,590
Other assets		39,493			44,172
Total assets	$	3,070,309		$	2,850,165
LIABILITIES AND SHAREHOLDERS’ EQUITY:
Noninterest-bearing deposits	$	739,181		$	685,336
Interest-bearing deposits		1,806,902			1,698,688
Total deposits		2,546,083			2,384,024
Short-term borrowings		166,266			143,244
Other liabilities		22,465			21,996
Shareholders’ equity		335,495			300,901
Total liabilities and shareholders’ equity	$	3,070,309		$	2,850,165

	Three Months Ended						Year Ended
	December 31,						December 31,
INCOME STATEMENTS	2007			2006			2007			2006
Interest income	$	43,482		$	40,564		$	169,369		$	154,494
Interest expense		14,229			13,594			58,557			48,628
Net interest income		29,253			26,970			110,812			105,866
Provision for loan losses		1,377			247			2,331			2,061
Net interest income after provision for loan losses		27,876			26,723			108,481			103,805
Noninterest income		12,390			11,047			48,273			44,668
Noninterest expense		22,730			21,118			86,827			83,017
Net income before income taxes		17,536			16,652			69,927			65,456
Income tax expense		5,030			4,943			20,437			19,427
Net income	$	12,506		$	11,709		$	49,490		$	46,029
PER COMMON SHARE DATA
Net income — basic	$	0.60		$	0.56		$	2.38		$	2.22
Net income — diluted		0.60			0.56			2.38			2.21
Cash dividends		0.32			0.30			1.26			1.18
Book value								16.16			14.51
Market value								37.65			41.86
Shares outstanding — end of period		20,766,848			20,739,127			20,766,848			20,739,127
Average outstanding shares — basic		20,765,397			20,734,697			20,757,868			20,725,432
Average outstanding shares — diluted		20,800,214			20,802,785			20,800,110			20,787,569
PERFORMANCE RATIOS
Return on average assets		1.68	%		1.67	%		1.72	%		1.68	%
Return on average equity		15.25			15.74			15.87			16.20
Net interest margin (tax equivalent)		4.50			4.43			4.43			4.46
Efficiency ratio		52.78			53.90			52.83			53.49

FIRST FINANCIAL BANKSHARES, INC.
SELECTED FINANCIAL DATA (UNAUDITED)
(In thousands)

	Quarter Ended
	’2007												2006
	Dec. 31,			Sept. 30,			June 30,			March 31,			Dec. 31,
ALLOWANCE FOR LOAN LOSSES
Balance at beginning of period	$	16,728		$	16,425		$	16,458		$	16,201		$	16,498
Loans charged off		(803	)		(342	)		(505	)		(147	)		(788	)
Loan recoveries		160			170			234			162			244
Net (charge-offs) recoveries		(643	)		(172	)		(271	)		15			(544	)
Provision for loan losses		1,377			475			238			242			247
Balance at end of period	$	17,462		$	16,728		$	16,425		$	16,458		$	16,201
Allowance for loan losses / period-end loans		1.14	%		1.15	%		1.18	%		1.17	%		1.18	%
Allowance for loan losses / nonperforming loans		541.5			395.6			387.4			226.5			442.9
Net charge-offs (recoveries) / average loans (annualized)		0.17			0.05			0.08			0.00			0.16
NONPERFORMING ASSETS
Nonaccrual loans	$	3,189		$	4,023		$	4,179		$	6,338		$	3,529
Accruing loans 90 days past due		36			206			61			928			129
Total nonperforming loans		3,225			4,229			4,240			7,266			3,658
Foreclosed assets		1,506			2,594			2,174			434			453
Total nonperforming assets	$	4,731		$	6,823		$	6,414		$	7,700		$	4,111
As a % of loans and foreclosed assets		0.31	%		0.47	%		0.46	%		0.55	%		0.30	%
CAPITAL RATIOS
Tier 1 Risk-based		14.65	%		14.81	%		14.85	%		14.71	%		14.35	%
Total Risk-based		15.62			15.76			15.81			15.69			15.32
Tier 1 Leverage		9.23			9.31			9.05			8.89			8.87
Equity to assets		10.93			11.12			10.75			10.74			10.56

	Three Months Ended				Year Ended
	December 31,				December 31,
NONINTEREST INCOME	2007		2006		2007		2006
Gain on sale of student loans, net	$	97	$	90	$	1,913	$	2,141
Gain on securities transactions, net		70		2		150		62
Trust fees		2,216		2,093		8,747		7,665
Service charges on deposits		6,153		5,661		22,920		22,450
Real estate mortgage fees		723		759		3,347		2,539
Net gain (loss) on sale of foreclosed assets		60		3		108		(10	)
ATM and credit card fees		2,005		1,655		7,521		6,214
Other noninterest income		1,066		784		3,567		3,607
Total Noninterest Income	$	12,390	$	11,047	$	48,273	$	44,668
NONINTEREST EXPENSE
Salaries and employee benefits	$	12,334	$	10,791	$	46,944	$	44,180
Net occupancy expense		1,535		1,488		5,893		5,986
Equipment expense		1,815		1,758		7,220		7,039
Printing, stationery and supplies		459		519		2,004		2,067
ATM and credit card expenses		989		859		3,871		3,398
Audit fees		208		218		882		856
Legal, tax and professional fees		722		561		2,714		2,289
Correspondent bank service charges		265		367		1,153		1,353
Advertising and public relations		687		703		2,488		2,472
Amortization of intangible assets		360		433		1,494		1,491
Other noninterest expense		3,356		3,421		12,164		11,886
Total Noninterest Expense	$	22,730	$	21,118	$	86,827	$	83,017
TAX EQUIVALENT YIELD ADJUSTMENT	$	1,422	$	1,161	$	5,267	$	4,656

FIRST FINANCIAL BANKSHARES, INC.
SELECTED FINANCIAL DATA (UNAUDITED)
(In thousands)

	Three Months Ended
	December 31, 2007
	Average		Tax Equivalent		Yield /
	Balance		Interest		Rate
Interest earning assets:
Fed funds sold	$	93,020	$	1,066		4.55	%
Interest bearing deposits in nonaffiliated banks		1,836		23		4.90	%
Taxable securities		818,303		9,626		4.71	%
Tax exempt securities		303,969		4,562		6.00	%
Loans		1,488,555		29,627		7.90	%
Total interest earning assets		2,705,683		44,904		6.59	%
Noninterest earning assets		252,742
Total assets	$	2,958,425
Interest bearing liabilities:
Deposits	$	1,750,144	$	12,655		2.87	%
Fed funds purchased and other short term borrowings		192,960		1,574		3.24	%
Total interest bearing liabilities		1,943,104		14,229		2.91	%
Noninterest bearing liabilities		689,908
Shareholders’ equity		325,413
Total liabilities and shareholders’ equity	$	2,958,425
Net interest income and margin (tax equivalent)			$	30,675		4.50	%

	Year Ended
	December 31, 2007
	Average		Tax Equivalent		Yield /
	Balance		Interest		Rate
Interest earning assets:
Fed funds sold	$	72,426	$	3,564		4.92	%
Interest bearing deposits in nonaffiliated banks		3,858		198		5.12	%
Taxable securities		832,807		38,881		4.67	%
Tax exempt securities		287,468		17,279		6.01	%
Loans		1,427,922		114,714		8.03	%
Total interest earning assets		2,624,481		174,636		6.66	%
Noninterest earning assets		251,712
Total assets	$	2,876,193
Interest bearing liabilities:
Deposits	$	1,736,227	$	51,980		2.99	%
Fed funds purchased and other short term borrowings		161,648		6,577		4.07	%
Total interest bearing liabilities		1,897,875		58,557		3.09	%
Noninterest bearing liabilities		666,520
Shareholders’ equity		311,798
Total liabilities and shareholders’ equity	$	2,876,193
Net interest income and margin (tax equivalent)			$	116,079		4.43	%