PR Newswire
WINTER HAVEN, Fla., July 27, 2023
WINTER HAVEN, Fla., July 27, 2023 /PRNewswire/ -- SouthState Corporation (NASDAQ: SSB) today released its unaudited results of operations and other financial information for the three-month and six-month periods ended June 30, 2023.
"Following the turmoil in March, we demonstrated the value of SouthState's granular deposit franchise with 6% annualized growth in customer deposits and a low cycle-to-date beta of 22%", said John C. Corbett, SouthState's Chief Executive Officer. "Additionally, we are pleased to report 11% annualized loan growth fueled by a resilient economy and strong population growth in the Southeast. As we approach the next phase of the economic cycle, we believe we are well-prepared with healthy capital and reserve levels."
Highlights of the second quarter of 2023 include:
Returns
- Reported Diluted Earnings per Share ("EPS") of $1.62; Adjusted Diluted EPS (Non-GAAP) of $1.63
- Net Income of $123.4 million; Adjusted Net Income (Non-GAAP) of $124.9 million
- Return on Average Common Equity of 9.3% and Return on Average Tangible Common Equity (Non-GAAP) of 15.8%; Adjusted Return on Average Tangible Common Equity (Non-GAAP) of 16.0%*
- Return on Average Assets ("ROAA") of 1.11%; Adjusted ROAA (Non-GAAP) of 1.12%*
- Pre-Provision Net Revenue ("PPNR") per weighted average diluted share (Non-GAAP) of $2.59
- Book Value per Share of $69.61 increased by $0.42 per share compared to the prior quarter
- Tangible Book Value ("TBV") per Share (Non-GAAP) of $42.96
∗ Annualized percentages
Performance
- Net Interest Income of $362 million; Core Net Interest Income (excluding loan accretion and deferred fees on PPP) (Non-GAAP) decreased $18 million from prior quarter, due to a $47 million increase in interest expense, offset by a $28 million increase in interest income and a $2 million decrease in loan accretion
- Net Interest Margin ("NIM"), non-tax equivalent and tax equivalent (Non-GAAP) of 3.62%
- Net charge-offs of $3.3 million, or 0.04% annualized; $38.4 million Provision for Credit Losses ("PCL"), including provision for unfunded commitments; 8 basis points build in total allowance for credit losses ("ACL") plus reserve for unfunded commitments to 1.56%
- Noninterest Income of $77 million, up $6 million compared to the prior quarter, primarily due to an increase in correspondent banking and capital market income; Noninterest Income represented 0.69% of average assets for the second quarter of 2023
- Efficiency Ratio of 54%; Adjusted Efficiency Ratio (Non-GAAP) of 53%
Balance Sheet
- Loans increased $841 million, or 11% annualized, led by consumer real estate and investor commercial real estate; ending loan to deposit ratio of 86%
- Deposits increased $340 million, or 4% annualized, despite a $209 million decline in brokered CDs; excluding brokered CDs, deposits increased $549 million, or 6% annualized, from prior quarter
- Total deposit cost of 1.11%, up 0.48% from prior quarter, resulting in a 22% cycle-to-date beta
- Other borrowings decreased $500 million as a result of FHLB advance payoffs during the quarter
- Strong capital position with Tangible Common Equity, Total Risk-Based Capital, Tier 1 Leverage, and Tier 1 Common Equity ratios of 7.6%, 13.5%, 9.2%, and 11.3%, respectivelyâ€
†Preliminary
Subsequent Events
- The Board of Directors of the Company increased its quarterly cash dividend on its common stock from $0.50 per share to $0.52 per share; the dividend is payable on August 18, 2023 to shareholders of record as of August 11, 2023
Financial Performance
Three Months Ended | Six Months Ended | |||||||||||||||||||||
(Dollars in thousands, except per share data) | Jun. 30, | Mar. 31, | Dec. 31, | Sep. 30, | Jun. 30, | Jun. 30, | Jun. 30, | |||||||||||||||
INCOME STATEMENT | 2023 | 2023 | 2022 | 2022 | 2022 | 2023 | 2022 | |||||||||||||||
Interest income | ||||||||||||||||||||||
Loans, including fees (1) | $ | 419,355 | $ | 393,366 | $ | 359,552 | $ | 312,856 | $ | 272,000 | $ | 812,720 | $ | 505,617 | ||||||||
Investment securities, trading securities, federal funds sold and securities | ||||||||||||||||||||||
purchased under agreements to resell (8) | 58,698 | 57,043 | 64,337 | 63,476 | 54,333 | 115,742 | 91,187 | |||||||||||||||
Total interest income | 478,053 | 450,409 | 423,889 | 376,332 | 326,333 | 928,462 | 596,804 | |||||||||||||||
Interest expense | ||||||||||||||||||||||
Deposits (8) | 100,787 | 55,942 | 19,945 | 7,534 | 4,914 | 156,729 | 9,506 | |||||||||||||||
Federal funds purchased, securities sold under agreements | ||||||||||||||||||||||
to repurchase, and other borrowings | 15,523 | 13,204 | 7,940 | 6,464 | 5,604 | 28,727 | 9,966 | |||||||||||||||
Total interest expense | 116,310 | 69,146 | 27,885 | 13,998 | 10,518 | 185,456 | 19,472 | |||||||||||||||
Net interest income (8) | 361,743 | 381,263 | 396,004 | 362,334 | 315,815 | 743,006 | 577,332 | |||||||||||||||
Provision for credit losses | 38,389 | 33,091 | 47,142 | 23,876 | 19,286 | 71,480 | 10,837 | |||||||||||||||
Net interest income after provision for credit losses | 323,354 | 348,172 | 348,862 | 338,458 | 296,529 | 671,526 | 566,495 | |||||||||||||||
Noninterest income (8) | 77,214 | 71,355 | 63,392 | 73,053 | 86,756 | 148,569 | 172,803 | |||||||||||||||
Noninterest expense | ||||||||||||||||||||||
Operating expense | 240,818 | 231,093 | 227,957 | 226,754 | 225,779 | 471,911 | 444,103 | |||||||||||||||
Merger, branch consolidation and severance related expense | 1,808 | 9,412 | 1,542 | 13,679 | 5,390 | 11,220 | 15,666 | |||||||||||||||
Total noninterest expense | 242,626 | 240,505 | 229,499 | 240,433 | 231,169 | 483,131 | 459,769 | |||||||||||||||
Income before provision for income taxes | 157,942 | 179,022 | 182,755 | 171,078 | 152,116 | 336,964 | 279,529 | |||||||||||||||
Income taxes provision | 34,495 | 39,096 | 39,253 | 38,035 | 32,941 | 73,591 | 60,025 | |||||||||||||||
Net income | $ | 123,447 | $ | 139,926 | $ | 143,502 | $ | 133,043 | $ | 119,175 | $ | 263,373 | $ | 219,504 | ||||||||
Adjusted net income (non-GAAP) (2) | ||||||||||||||||||||||
Net income (GAAP) | $ | 123,447 | $ | 139,926 | $ | 143,502 | $ | 133,043 | $ | 119,175 | $ | 263,373 | $ | 219,504 | ||||||||
Securities gains, net of tax | — | (35) | — | (24) | — | (35) | — | |||||||||||||||
Initial provision for credit losses - NonPCD loans and UFC from ACBI, net of tax | — | — | — | — | — | — | 13,492 | |||||||||||||||
Merger, branch consolidation and severance related expense, net of tax | 1,414 | 7,356 | 1,211 | 10,638 | 4,223 | 8,770 | 12,314 | |||||||||||||||
Adjusted net income (non-GAAP) | $ | 124,861 | $ | 147,247 | $ | 144,713 | $ | 143,657 | $ | 123,398 | $ | 272,108 | $ | 245,310 | ||||||||
Basic earnings per common share | $ | 1.62 | $ | 1.84 | $ | 1.90 | $ | 1.76 | $ | 1.58 | $ | 3.47 | $ | 2.99 | ||||||||
Diluted earnings per common share | $ | 1.62 | $ | 1.83 | $ | 1.88 | $ | 1.75 | $ | 1.57 | $ | 3.45 | $ | 2.96 | ||||||||
Adjusted net income per common share - Basic (non-GAAP) (2) | $ | 1.64 | $ | 1.94 | $ | 1.91 | $ | 1.90 | $ | 1.64 | $ | 3.58 | $ | 3.34 | ||||||||
Adjusted net income per common share - Diluted (non-GAAP) (2) | $ | 1.63 | $ | 1.93 | $ | 1.90 | $ | 1.89 | $ | 1.62 | $ | 3.56 | $ | 3.31 | ||||||||
Dividends per common share | $ | 0.50 | $ | 0.50 | $ | 0.50 | $ | 0.50 | $ | 0.49 | $ | 1.00 | $ | 0.98 | ||||||||
Basic weighted-average common shares outstanding | 76,057,977 | 75,902,440 | 75,639,640 | 75,605,960 | 75,461,157 | 75,980,638 | 73,464,620 | |||||||||||||||
Diluted weighted-average common shares outstanding | 76,417,537 | 76,388,954 | 76,326,777 | 76,182,131 | 76,094,198 | 76,394,174 | 74,103,640 | |||||||||||||||
Effective tax rate | 21.84 % | 21.84 % | 21.48 % | 22.23 % | 21.66 % | 21.84 % | 21.47 % | |||||||||||||||
Performance and Capital Ratios
Three Months Ended | Six Months End | ||||||||||||||||||||
