8-K
SEACOAST BANKING CORP OF FLORIDA (SBCF)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported) July 22, 2021
SEACOAST BANKING CORPORATION OF FLORIDA
(Exact Name of Registrant as Specified in Charter)
| Florida | 000-13660 | 59-2260678 | |||||
|---|---|---|---|---|---|---|---|
| (State or Other Jurisdiction<br>of Incorporation) | (Commission<br>File Number) | (IRS Employer<br>Identification No.) | 815 COLORADO AVENUE, | STUART | FL | 34994 | |
| --- | --- | --- | --- | ||||
| (Address of Principal Executive Offices) | (Zip Code) |
Registrant’s telephone number, including area code (772) 287-4000
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2.)
☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
|---|---|---|
| Common Stock, $0.10 par value | SBCF | Nasdaq Global Select Market |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
SEACOAST BANKING CORPORATION OF FLORIDA
Item 2.02 Results of Operations and Financial Condition
On July 22, 2021, Seacoast Banking Corporation of Florida (“Seacoast” or the “Company”) announced its financial results for the quarter ended June 30, 2021. A copy of the press release announcing Seacoast’s results for the quarter ended June 30, 2021 is attached hereto as Exhibit 99.1 and incorporated herein by reference.
Item 7.01 Regulation FD Disclosure
On July 23, 2021, Seacoast will hold an investor conference call to discuss its financial results for the quarter ended June 30, 2021. Attached as Exhibit 99.2 are charts (available on the Company’s website at www.seacoastbanking.com) containing information used in the conference call and incorporated herein by reference. All information included in the charts is presented as of June 30, 2021, and the Company does not assume any obligation to correct or update said information in the future.
The information in Items 2.02 and 7.01, as well as Exhibits 99.1 and 99.2 is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933.
Item 9.01 Financial Statements and Exhibits
(d) Exhibits
| Exhibit No. | Description |
|---|---|
| 99.1 | Press Release dated July 22, 2021, with respect to Seacoast's financial results for the quarterended June 30, 2021 |
| 99.2 | Data on website containing information used in the conference call to be held on July 23, 2021 |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
Exhibits 99.1 and 99.2 referenced herein, contain “forward-looking statements” within the meaning of Section 28A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including, without limitation, statements about future financial and operating results, cost savings, enhanced revenues, economic and seasonal conditions in our markets, and improvements to reported earnings that may be realized from cost controls, tax law changes, new initiatives and for integration of banks that we have acquired, or expected to acquire, including Legacy Bank of Florida, as well as statements with respect to Seacoast's objectives, strategic plans, expectations and intentions and other statements that are not historical facts, any of which may be impacted by the COVID-19 pandemic and related effects on the U.S.economy. Actual results may differ from those set forth in the forward-looking statements.
This press release contains "forward-looking statements" within the meaning, and protections, of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including, without limitation, statements about future financial and operating results, loan growth, cost savings, enhanced revenues, economic and seasonal conditions in our markets, and improvements to reported earnings that may be realized from cost controls, tax law changes, new initiatives and for integration of banks that we have acquired, or expect to acquire, including Legacy Bank of Florida, as well as statements with respect to Seacoast's objectives, strategic plans, expectations and intentions and other statements that are not historical facts, any of which may be impacted by the COVID-19 pandemic and any variants thereof and related effects on the U.S. economy. Actual results may differ from those set forth in the forward-looking statements.
Forward-looking statements include statements with respect to our beliefs, plans, objectives, goals, expectations, anticipations, assumptions, estimates and intentions about future performance and involve known and unknown risks, uncertainties and other factors, which may be beyond our control, and which may cause the actual results, performance or achievements of Seacoast to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. You should not expect us to update any forward-looking statements.
All statements other than statements of historical fact could be forward-looking statements. You can identify these forward-looking statements through our use of words such as "may", "will", "anticipate", "assume", "should", "support", "indicate", "would", "believe", "contemplate", "expect", "estimate", "continue", "further", "plan", "point to", "project", "could", "intend", "target" or other similar words and expressions of the future. These forward-looking statements may not be realized due to a variety of factors, including, without limitation: the effects of future economic and market conditions, including seasonality and the adverse impact of COVID-19 (economic and otherwise); governmental monetary and fiscal policies, including interest rate policies of the Board of Governors of the Federal Reserve, as well as legislative, tax and regulatory changes, including those that impact the money supply and inflation; changes in accounting policies, rules and practices, including the impact of the adoption of CECL; our participation in the Paycheck Protection Program ("PPP"); the risks of changes in interest rates on the level and composition of deposits, loan demand, liquidity and the values of loan collateral, securities, and interest sensitive assets and liabilities; interest rate risks, sensitivities and the shape of the yield curve; uncertainty related to the impact of LIBOR calculations on securities and loans; changes in borrower credit risks and payment behaviors; changing retail distribution strategies, customer preferences and behavior; changes in the availability and cost of credit and capital in the financial markets; changes in the prices, values and sales volumes of residential and commercial real estate; our ability to comply with any regulatory requirements; the effects of problems encountered by other financial institutions that adversely affect us or the banking industry; our concentration in commercial real estate loans; inaccuracies or other failures from the use of models, including the failure of assumptions and estimates, as well as differences in, and changes to, economic, market and credit conditions; the impact on the valuation of our investments due to market volatility or counterparty payment risk; statutory and regulatory dividend restrictions; increases in regulatory capital requirements for banking organizations generally; the risks of mergers, acquisitions and divestitures, including our ability to continue to identify acquisition targets and successfully acquire desirable financial institutions; changes in technology or products that may be more difficult, costly, or less effective than anticipated; our ability to identify and address increased cybersecurity risks; inability of our risk management framework to manage risks associated with our business; dependence on key suppliers or vendors to obtain equipment or services for our business on acceptable terms; reduction in or the termination of our ability to use the mobile-based platform that is critical to our business growth strategy; the effects of war or other conflicts, acts of terrorism, natural disasters, health emergencies, epidemics or pandemics, or other catastrophic events that may affect general economic conditions; unexpected outcomes of and the costs associated with, existing or new litigation involving us; our ability to maintain adequate internal controls over financial reporting; potential claims, damages, penalties, fines and reputational damage resulting from pending or future litigation, regulatory proceedings and enforcement actions; the risks that our deferred tax assets could be reduced if estimates of future taxable income from our operations and tax planning strategies are less than currently estimated and sales of our capital stock could trigger a reduction in the amount of net operating loss carryforwards that we may be able to utilize for income tax purposes; the effects of competition from other commercial banks, thrifts, mortgage banking firms, consumer finance companies, credit unions, securities brokerage firms, insurance companies, money market and other mutual funds and other financial institutions operating in our market areas and elsewhere, including institutions operating regionally, nationally and internationally, together with such competitors offering banking products and services by mail, telephone, computer and the Internet; and the failure of assumptions underlying the establishment of reserves for possible loan losses.
The risks relating to the Legacy Bank of Florida proposed merger include, without limitation: the timing to consummate the proposed merger; the risk that a condition to closing of the proposed merger may not be satisfied; the risk that the merger is not completed at all; the diversion of management time on issues related to the proposed merger; unexpected transaction costs, including the costs of integrating operations; the risks that the businesses
will not be integrated successfully or such integration may be more difficult, time-consuming or costly than expected; the potential failure to fully or timely realize expected revenues and revenue synergies, including as the result of revenues following the merger being lower than expected; the risk of deposit and customer attrition; any changes in deposit mix; unexpected operating and other costs, which may differ or change from expectation; the risk of customer and employee loss and business disruptions, including, without limitation, as the result of difficulties in maintaining relationships with employees; increased competitive pressures on solicitations of customers by competitors; as well as difficulties and risks inherent with entering new markets.
Actual results and capital and other financial conditions may differ materially from those included in these statements due to a variety of factors. These factors include, among others described above, macroeconomic and other challenges and uncertainties related to the COVID-19 pandemic, such as the duration and severity of the impact on public health, the U.S. and global economies, financial markets and consumer and corporate customers and clients, including economic activity and employment, as well as the various actions taken in response by governments, central banks and others, including Seacoast, and the precautionary statements included in this release.
All written or oral forward-looking statements attributable to us are expressly qualified in their entirety by this cautionary notice, including, without limitation, those risks and uncertainties described in our annual report on Form 10-K for the year ended December 31, 2020 and quarterly report on Form 10-Q for the quarter ended March 31, 2021 under "Special Cautionary Notice Regarding Forward-looking Statements" and "Risk Factors", and otherwise in our SEC reports and filings. Such reports are available upon request from the Company, or from the Securities and Exchange Commission, including through the SEC's Internet website at www.sec.gov.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
SEACOAST BANKING CORPORATION OF FLORIDA
(Registrant)
| Dated: July 22, 2021 | /s/ Tracey L. Dexter |
|---|---|
| TRACEY L. DEXTER | |
| Chief Financial Officer |
SBCF 2Q 2021 Earnings Release
SEACOAST REPORTS SECOND QUARTER 2021 RESULTS
Pipelines Expand Sequentially, in Line with a Flourishing Florida Economy
Record Quarter for Wealth Management, Interchange Income, and Growth in Transaction Account Balances
STUART, Fla., July 22, 2021 /GLOBE NEWSWIRE/ -- Seacoast Banking Corporation of Florida ("Seacoast" or the "Company") (NASDAQ: SBCF) today reported net income in the second quarter of 2021 of $31.4 million, or $0.56 per diluted share, a decrease of 7% compared to the first quarter of 2021, and an increase of 25% compared to the second quarter of 2020. Adjusted net income1 for the second quarter of 2021 was $33.3 million, or $0.59 per diluted share, a decrease of 6% compared to the first quarter of 2021, and an increase of 31% compared to the second quarter of 2020. The ratio of tangible common equity to tangible assets was 10.43%, tangible book value per share increased to $17.08 and Tier 1 capital increased to 18.3%.
For the second quarter of 2021, return on average tangible assets was 1.48%, return on average tangible shareholders' equity was 13.88%, and the efficiency ratio was 54.93%, compared to 1.70%, 15.62%, and 53.21%, respectively, in the prior quarter, and 1.37%, 13.47%, and 50.11%, respectively, in the prior year quarter. Adjusted return on average tangible assets1 in the second quarter of 2021 was 1.52%, adjusted return on average tangible shareholders' equity1 was 14.27%, and the adjusted efficiency ratio1 was 53.49%, compared to 1.75%, 16.01%, and 51.99%, respectively, in the prior quarter, and 1.33%, 13.09%, and 49.60%, respectively, in the prior year quarter.
Charles M. Shaffer, Seacoast's President and CEO, said, “Our investments over the last six months in commercial banking talent and technology are evident in the pipeline growth this quarter, and we continue to see strong economic expansion in our markets. Our transaction account balances have grown $860 million from the start of the year, a reflection of the strength of our customer franchise. While this significant growth in deposits is impacting our net interest margin, our low-cost funding base positions us for success as rates increase and as demand for credit continues to expand in the coming periods.”
Mr. Shaffer further commented, “We continue to steadily build shareholder value through consistent growth in our tangible book value per share, which has increased 13% year-over-year to $17.08, overcoming the challenge of the pandemic. The Company is committed to maintaining our fortress balance sheet, supported by a robust capital position and a strictly underwritten credit portfolio. Our prudent capital levels, low cost of funds, and ample liquidity support further disciplined organic growth and opportunistic acquisitions as we move forward.”
Financial Results
Income Statement
•Net income was $31.4 million, or $0.56 per diluted share for the second quarter of 2021, compared to $33.7 million, or $0.60, for the prior quarter, and $25.1 million, or $0.47, for the prior year quarter. For the six months ended June 30, 2021, net income was $65.1 million, or $1.17 per diluted share, compared to $25.8 million, or $0.49, for the six months ended June 30, 2020. Adjusted net income1 was $33.3 million, or $0.59 per diluted share for the second quarter of 2021, compared to $35.5 million, or $0.63, for the prior quarter, and $25.5 million, or $0.48, for the prior year quarter. For the six months ended June 30, 2021, adjusted net income1 was $68.7 million, or $1.23 per diluted share, compared to $30.9 million, or $0.59, for the six months ended June 30, 2020.
•Net revenues were $81.1 million in the second quarter of 2021, a decrease of $3.2 million, or 4%, compared to the prior quarter, and a decrease of $1.2 million, or 1%, compared to the prior year quarter. For the six months ended June 30, 2021, net revenues were $165.4 million, an increase of $5.3 million, or 3%, compared to the six months ended June 30, 2020. Adjusted revenues1 were $81.2 million in the second quarter of 2021, a decrease of $3.2 million, or 4%, from the prior quarter, and an increase of $0.1 million, or 0.2%, compared to the prior year quarter. For the six months ended June 30, 2021 net revenues were $165.6 million, an increase of $6.7 million, or 4%, compared to the six months ended June 30, 2020.
1Non-GAAP measure, see “Explanation of Certain Unaudited Non-GAAP Financial Measures" for more information and for a reconciliation to GAAP.
•Net interest income totaled $65.8 million in the second quarter of 2021, a decrease of $0.8 million, or 1%, from the prior quarter reflecting lower income from Paycheck Protection Program (“PPP”) loans, partially offset by lower interest expense on deposits. During the second quarter of 2021, net interest income included $5.1 million in interest and fees earned on PPP loans compared to $6.9 million in the first quarter of 2021. For the six months ended June 30, 2021, net interest income was $132.4 million, an increase of $2.0 million, or 2%, compared to the six months ended June 30, 2020. As of June 30, 2021, remaining deferred fees on PPP loans total $10.6 million, which will be recognized over the loans' remaining contractual maturity or earlier, as loans are forgiven.
•Net interest margin declined from 3.51% in the first quarter of 2021 to 3.23% in the second quarter of 2021, largely as the result of significant growth in transaction account deposit balances during the second quarter. This increase in funding occurred across our customer base at near-zero rates, as new clients were onboarded and existing clients continue to see expansion in cash balances. The resulting increase in liquidity negatively impacted net interest margin by 23 basis points. Excluding this increase in liquidity, the remaining decline in net interest margin is attributed to lower PPP interest and fees as a result of declining balances as PPP loans are forgiven. Excess liquidity has been partially invested through securities purchases; however, cash deployment remains disciplined and prudent, with careful reinvestment of liquidity over time. Securities yields declined by only two basis points to 1.63% in the second quarter of 2021. Non-PPP loan yields declined by only one basis point to 4.36% during the second quarter of 2021. Offsetting and favorable was the decline in the cost of deposits from 13 basis points in the first quarter of 2021 to eight basis points in the second quarter of 2021. The effect on net interest margin of accretion of purchase discounts on acquired loans was an increase of 14 basis points in the second quarter compared to an increase of 15 basis points in the prior quarter. The effect on net interest margin of interest and fees on PPP loans was an increase of six basis points in the second quarter and an increase of 11 basis points in the prior quarter.
•Noninterest income totaled $15.3 million in the second quarter of 2021, a decrease of $2.3 million, or 13%, compared to the prior quarter, and an increase of $0.3 million, or 2%, compared to the prior year quarter. For the six months ended June 30, 2021, noninterest income was $33.0 million, an increase of $3.3 million, or 11%, compared to the six months ended June 30, 2020. Results for the second quarter of 2021 included the following:
▪Interchange revenue reached a new record of $4.1 million, compared to $3.8 million in the prior quarter, reflecting higher transactional volume and higher per-card spending, both indicative of the strength and confidence in our consumer and small business franchise.
▪Wealth management income increased to a record $2.4 million in the current quarter, compared to $2.3 million in the first quarter of 2021. The team continues to deliver strong growth in assets under management, which increased $133 million quarter-over-quarter, bringing total assets under management to $1.2 billion. The team is successfully winning business with commercial relationships and high net worth families across the Company’s footprint.
▪Mortgage banking fees were $3.0 million, compared to $4.2 million in the prior quarter, due to slowing refinance activity and low housing inventory levels.
▪Other income declined by $1.5 million in the second quarter of 2021, reflecting the impact in the first quarter of 2021 of $1.7 million in income associated with the resolution of contingencies on two loans acquired in 2017.
•The provision for credit losses was a net benefit of $4.9 million in the second quarter of 2021, compared to a net benefit of $5.7 million in the prior quarter, and provision expense of $7.6 million in the prior year quarter. The ratio of allowance for credit losses to total loans declined to 1.49% at June 30, 2021, compared to 1.53% at March 31, 2021 and 1.58% at June 30, 2020. Excluding PPP loans, the ratio declined to 1.60% at June 30, 2021, compared to 1.71% at March 31, 2021 and 1.76% at June 30, 2020, reflecting a continued improvement in the economic outlook.
•Noninterest expense was $45.8 million in the second quarter of 2021, a decrease of $0.3 million, or 1%, compared to the prior quarter, and an increase of $3.4 million, or 8%, compared to the prior year quarter. For the six months ended June 30, 2021, noninterest expense was $91.9 million, an increase of $1.7 million, or 2%,
1Non-GAAP measure, see “Explanation of Certain Unaudited Non-GAAP Financial Measures" for more information and for a reconciliation to GAAP.
compared to the six months ended June 30, 2020. Changes from the first quarter of 2021 consisted of the following:
▪Salaries and wages increased $1.6 million, or 7%, to $23.0 million. In the first quarter of 2021, PPP loan production resulted in higher deferrals of related salary costs, impacting the first quarter by $1.9 million. This deferral slowed in the second quarter, as the PPP program ended.
▪Employee benefits decreased $1.0 million, or 21%, with the prior quarter reflecting the seasonal impact of higher payroll taxes and 401(k) plan contributions.
▪Occupancy expenses decreased $0.5 million, or 13%. Three branch consolidations were completed in the first quarter of 2021, resulting in associated charges in the first quarter of $0.3 million.
▪Legal and professional fees decreased by $0.4 million, or 15%, compared to the first quarter, reflecting lower legal fees, including a $0.1 million decrease in merger-related costs.
•Seacoast recorded $8.8 million of income tax expense in the second quarter of 2021, compared to $10.2 million in the prior quarter and $7.2 million in the second quarter of 2020. A tax benefit related to stock-based compensation totaled $0.6 million in the second quarter of 2021, compared to a tax benefit of $0.1 million in the first quarter of 2021, and tax expense of $0.2 million in the second quarter of 2020.
•The ratio of net adjusted noninterest expense1 to average tangible assets was 1.98% in the second quarter of 2021, compared to 2.16% in the prior quarter and 2.11% in the second quarter of 2020.
•The efficiency ratio was 54.93% compared to 53.21% in the prior quarter and 50.11% in the prior year quarter. The adjusted efficiency ratio1 was 53.49% compared to 51.99% in the prior quarter and 49.60% in the prior year quarter. The Company remains committed to efficiency through disciplined, proactive management of its cost structure.
Balance Sheet
•At June 30, 2021, the Company had total assets of $9.3 billion and total shareholders' equity of $1.2 billion. Book value per share increased to $21.33 from $20.89 on March 31, 2021, and $19.45 on June 30, 2020. Tangible book value per share of $17.08 on June 30, 2021 has increased 11% on an annualized basis compared to March 31, 2021, and 13% compared to June 30, 2020.
•Debt securities totaled $1.8 billion on June 30, 2021, an increase of $252.5 million, or 16%, compared to March 31, 2021. Purchases during the quarter were primarily in agency-issued collateralized mortgage obligations and had an average yield of 1.39% and a duration of 3.1 years. The Company continues to take a prudent and disciplined approach to reinvesting liquidity.
•Loans totaled $5.4 billion on June 30, 2021, a decrease of $224.4 million, or 4%, compared to March 31, 2021. The decrease includes $243.0 million in PPP loan forgiveness during the second quarter of 2021. Removing the impact of declines in PPP loans outstanding, loans declined only $6.9 million from the prior quarter.
•Loan originations, excluding PPP, were $456.5 million in the second quarter of 2021, compared to $436.0 million in the first quarter of 2021, an increase of 5%.
▪Commercial originations during the second quarter of 2021 were $193.0 million, compared to $204.3 million in the first quarter of 2021 and $106.9 million in the second quarter of 2020.
▪Consumer originations in the second quarter of 2021 increased to $63.7 million from $46.7 million in the first quarter of 2021, and $58.0 million in the second quarter of 2020.
▪Residential loans originated for sale in the secondary market totaled $120.1 million in the second quarter of 2021, compared to $138.3 million in the first quarter of 2021, and $122.5 million in the second quarter of 2020. While we expect to continue to see the benefit of the inflow of new residents and businesses into Florida, refinance activity has slowed from the peaks seen in the last several quarters, and housing inventory is low.
1Non-GAAP measure, see “Explanation of Certain Unaudited Non-GAAP Financial Measures" for more information and for a reconciliation to GAAP.
▪Closed residential loans retained in the portfolio totaled $79.7 million in the second quarter of 2021, compared to $46.6 million in the first quarter of 2021, and $23.5 million in the second quarter of 2020.
•Pipelines (loans in underwriting and approval or approved and not yet closed) totaled $468.5 million on June 30, 2021, an increase of 8% from March 31, 2021 and an increase of 83% from June 30, 2020.
▪Commercial pipelines were $322.0 million as of June 30, 2021, an increase of 34% from $240.9 million at March 31, 2021 and an increase of 175% from $117.0 million at June 30, 2020. With significant economic growth in the State of Florida and the addition of top talent across our footprint, we expect production to increase in the second half of 2021.
▪Consumer pipelines were $31.7 million as of June 30, 2021, compared to $28.1 million at March 31, 2021 and $30.6 million at June 30, 2020.
▪Residential saleable pipelines were $60.6 million as of June 30, 2021, compared to $92.1 million at March 31, 2021 and $94.7 million at June 30, 2020. Retained residential pipelines were $54.1 million as of June 30, 2021, compared to $72.4 million at March 31, 2021 and $13.2 million at June 30, 2020.
•Total deposits were $7.8 billion as of June 30, 2021, an increase of $450.7 million, or 6%, compared to March 31, 2021.
▪The overall cost of deposits declined to 8 basis points in the second quarter of 2021 from 13 basis points in the prior quarter.
▪Total transaction account balances increased $382.9 million, or 9%, quarter-over-quarter, and at June 30, 2021 represent 60% of overall deposit funding. The increase in funding occurred across our customer base at near-zero rates, as new clients were onboarded and existing clients continue to see expansion in cash balances.
▪Interest-bearing deposits (interest-bearing demand, savings, and money market deposits) increased $295.1 million, or 7%, quarter-over-quarter to $4.4 billion, noninterest-bearing demand deposits increased $266.9 million, or 10%, to $3.0 billion, and CDs (excluding brokered) declined $37.8 million, or 7%, to $481.7 million.
▪As of June 30, 2021, deposits per banking center were $163 million, compared to $154 million at March 31, 2021 and $133 million on June 30, 2020.
Asset Quality
•Nonperforming loans decreased by $2.4 million to $32.9 million at June 30, 2021. Nonperforming loans to total loans outstanding were 0.61% at June 30, 2021, 0.62% at March 31, 2021, and 0.52% at June 30, 2020.
•Nonperforming assets to total assets were 0.49% at June 30, 2021, 0.58% at March 31, 2021, and 0.57% at June 30, 2020.
•The ratio of allowance for credit losses to total loans was 1.49% at June 30, 2021, 1.53% at March 31, 2021, and 1.58% at June 30, 2020. Excluding PPP loans, the ratio of allowance for credit losses to total loans at June 30, 2021, was 1.60%, compared to 1.71% at March 31, 2021 and 1.76% at June 30, 2020. The decline in coverage reflects continued improvement in the economic outlook.
•Net charge-offs were $0.7 million, or 0.05%, of average loans for the second quarter of 2021 compared to $0.4 million, or 0.03%, of average loans in the first quarter of 2021 and $1.8 million, or 0.12%, of average loans in the second quarter of 2020. Net charge-offs for the four most recent quarters averaged 0.10%.
•Portfolio diversification, in terms of asset mix, industry, and loan type, has been a critical element of the Company's lending strategy. Exposure across industries and collateral types is broadly distributed. Excluding PPP loans, Seacoast's average commercial loan size is $420 thousand, reflecting an ability to maintain granularity within the overall loan portfolio.
•Construction and land development and commercial real estate loans remain well below regulatory guidance at 24% and 164% of total bank-level risk-based capital, respectively, compared to 23% and 168%
1Non-GAAP measure, see “Explanation of Certain Unaudited Non-GAAP Financial Measures" for more information and for a reconciliation to GAAP.
respectively, in the first quarter of 2021. On a consolidated basis, construction and land development and commercial real estate loans represent 22% and 150%, respectively, of total consolidated risk-based capital.
Capital and Liquidity
•The tier 1 capital ratio increased to 18.3% from 18.1% at March 31, 2021, and 16.4% at June 30, 2020. The total capital ratio was 19.2% and the tier 1 leverage ratio was 11.7% at June 30, 2021.
•Cash and cash equivalents at June 30, 2021 totaled $1.4 billion, an increase of $469.5 million, or 48%, from March 31, 2021, largely the result of increased deposit balances during the quarter.
•Tangible common equity to tangible assets was 10.43% at June 30, 2021, compared to 10.71% at March 31, 2021 and 10.19% at June 30, 2020. The ratio declined quarter-over-quarter largely as a result of a continued increase in liquidity on the balance sheet. The Company will deploy this liquidity in a disciplined and prudent manner.
•At June 30, 2021, the Company had available unsecured lines of credit of $135.0 million and lines of credit under lendable collateral value of $1.7 billion. Additionally, $1.5 billion of debt securities and $688.4 million of residential and commercial real estate loans are available as collateral for potential borrowings.
1Non-GAAP measure, see “Explanation of Certain Unaudited Non-GAAP Financial Measures" for more information and for a reconciliation to GAAP.
| FINANCIAL HIGHLIGHTS | |||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| (Amounts in thousands except per share data) | (Unaudited) | ||||||||||||||
| Quarterly Trends | |||||||||||||||
| 2Q'21 | 1Q'21 | 4Q'20 | 3Q'20 | 2Q'20 | |||||||||||
| Selected Balance Sheet Data: | |||||||||||||||
| Total Assets | $ | 9,316,833 | $ | 8,811,820 | $ | 8,342,392 | $ | 8,287,840 | $ | 8,084,013 | |||||
| Gross Loans | 5,437,049 | 5,661,492 | 5,735,349 | 5,858,029 | 5,772,052 | ||||||||||
| Total Deposits | 7,836,436 | 7,385,749 | 6,932,561 | 6,914,843 | 6,666,783 | ||||||||||
| Performance Measures: | |||||||||||||||
| Net Income | $ | 31,410 | $ | 33,719 | $ | 29,347 | $ | 22,628 | $ | 25,080 | |||||
| Net Interest Margin | 3.23 | % | 3.51 | % | 3.59 | % | 3.40 | % | 3.70 | % | |||||
| Average Diluted Shares Outstanding | 55,901 | 55,992 | 55,739 | 54,301 | 53,308 | ||||||||||
| Diluted Earnings Per Share (EPS) | $ | 0.56 | $ | 0.60 | $ | 0.53 | $ | 0.42 | $ | 0.47 | |||||
| Return on (annualized): | |||||||||||||||
| Average Assets (ROA) | 1.40 | % | 1.61 | % | 1.39 | % | 1.11 | % | 1.27 | % | |||||
| Average Tangible Assets (ROTA)2 | 1.48 | 1.70 | 1.49 | 1.20 | 1.37 | ||||||||||
| Average Tangible Common Equity (ROTCE)2 | 13.88 | 15.62 | 13.87 | 11.35 | 13.47 | ||||||||||
| Tangible Common Equity to Tangible Assets2 | 10.43 | 10.71 | 11.01 | 10.67 | 10.19 | ||||||||||
| Tangible Book Value Per Share2 | $ | 17.08 | $ | 16.62 | $ | 16.16 | $ | 15.57 | $ | 15.11 | |||||
| Efficiency Ratio | 54.93 | % | 53.21 | % | 48.23 | % | 61.65 | % | 50.11 | % | |||||
| Adjusted Operating Measures1: | |||||||||||||||
| Adjusted Net Income | $ | 33,251 | $ | 35,497 | $ | 30,700 | $ | 27,336 | $ | 25,452 | |||||
| Adjusted Diluted EPS | 0.59 | 0.63 | 0.55 | 0.50 | 0.48 | ||||||||||
| Adjusted ROTA2 | 1.52 | % | 1.75 | % | 1.50 | % | 1.38 | % | 1.33 | % | |||||
| Adjusted ROTCE2 | 14.27 | 16.01 | 14.00 | 13.06 | 13.09 | ||||||||||
| Adjusted Efficiency Ratio | 53.49 | 51.99 | 48.75 | 54.82 | 49.60 | ||||||||||
| Net Adjusted Noninterest Expense as a<br><br>Percent of Average Tangible Assets2 | 1.98 | 2.16 | 2.00 | 2.24 | 2.11 | ||||||||||
| Other Data: | |||||||||||||||
| Market capitalization3 | $ | 1,893,141 | $ | 2,003,866 | $ | 1,626,913 | $ | 994,690 | $ | 1,081,009 | |||||
| Full-time equivalent employees | 946 | 953 | 965 | 968 | 924 | ||||||||||
| Number of ATMs | 75 | 75 | 77 | 77 | 76 | ||||||||||
| Full-service banking offices | 48 | 48 | 51 | 51 | 50 | ||||||||||
| Registered online users | 129,568 | 126,352 | 123,615 | 121,620 | 117,273 | ||||||||||
| Registered mobile devices | 122,815 | 117,959 | 115,129 | 110,241 | 108,062 | ||||||||||
| 1Non-GAAP measure, see “Explanation of Certain Unaudited Non-GAAP Financial Measures" for more information and a reconciliation to GAAP. | |||||||||||||||
| 2The Company defines tangible assets as total assets less intangible assets, and tangible common equity as total shareholders' equity less intangible assets. | |||||||||||||||
| 3Common shares outstanding multiplied by closing bid price on last day of each period. |
Second Quarter Strategic Highlights
Legacy Bank of Florida Acquisition
Seacoast’s balanced growth strategy, combining organic growth with value-creating acquisitions, continues to benefit shareholders and expand the franchise across Florida. The upcoming acquisition of Legacy Bank of Florida, which is expected to close in the third quarter of 2021, will add experienced bankers in the rapidly growing South Florida market, and should further support disciplined, profitable growth for the Company.
Capitalizing on Seacoast’s Early Commitment to Digital Transformation
•Seacoast and its customers are benefiting from the Company’s automated online PPP forgiveness solution, which streamlines the process for clients while integrating with Seacoast’s existing technology infrastructure. In the second quarter of 2021, Seacoast processed $243 million in PPP loan forgiveness.
•The Company completed a significant investment in its nCino digital commercial loan origination platform. This investment will accelerate speed to market, provide a quicker renewal process, and provide a streamlined workflow for bankers and underwriters.
Scaling and Evolving Our Culture
•Seacoast recently announced the continued expansion of its commercial banking leadership team with three new additions, each bringing significant market expertise and has been successful in developing high performing commercial banking teams.
•James Norton joined Seacoast as executive vice president and commercial real estate executive. James brings 20 years of experience in commercial real estate to Seacoast Bank. Most recently, James served as a real estate banking director covering the Mid-Atlantic market at JPMorgan Chase. He previously served in executive positions with the BB&T Corporation, IronStone Bank, and SunTrust Bank in the Southeast region. Based out of Tampa, James led the expansion of BB&T’s commercial real estate business in Florida prior to relocating to the Mid-Atlantic region.
•Chris Rolle joined Seacoast as president of the West Florida region, covering the west coast from the Tampa Bay area to Naples-Ft. Myers. Rolle is a former executive at Synovus Bank, Florida Community Bank, and the BB&T Corporation covering both the Tampa-St. Petersburg and Orlando MSAs.
•Robert Hursh joined Seacoast as market president for Pinellas County (St. Petersburg/Clearwater). Robert, a Pinellas County native, has more than 20 years of experience in leading commercial banking teams in the Tampa-St. Petersburg MSA, most recently as senior vice president with Synovus Bank.
•The Company also added two new operational leaders to support growth.
•Anthony Cavallaro joined Seacoast as senior vice president and operations executive and brings more than 25 years of experience, having led operations and risk management teams at Civista Bank and KeyBank.
•Robert Walla joined Seacoast as senior vice president and director of loan operations. Bob brings 30 years of operations leadership, most recently at First Midwest Bank in Chicago, Illinois.
•During the second quarter, Seacoast Bank was named among the Orlando Business Journal's 2021 Best Places to Work. This recognition acknowledges Seacoast’s commitment to employees’ well-being, especially throughout the pandemic, as well as the Company’s numerous diversity and inclusion initiatives.
•Seacoast was also recently recognized as part of the Human Rights Campaign Foundation’s 2021 Corporate Equality Index as a Best Place to Work for LGBTQ Equality, earning a top score of 100%.
OTHER INFORMATION
Conference Call Information
Seacoast will host a conference call on July 23, 2021 at 10:00 a.m. (Eastern Time) to discuss the second quarter 2021 earnings results and business trends. Investors may call in (toll-free) by dialing (800) 774-6070 (passcode: 7461 099#; host: Charles Shaffer). Charts will be used during the conference call and may be accessed at Seacoast's website at www.SeacoastBanking.com by selecting "Presentations" under the heading "News/Events." A replay of the call will be available for one month, beginning late afternoon on July 23, 2021, and can be accessed via a link at www.SeacoastBanking.com under the heading “Corporate Information,” using the passcode 50182591.
Alternatively, individuals may listen to the live webcast of the presentation by visiting Seacoast's website at www.SeacoastBanking.com. The link is located in the subsection "Presentations" under the heading “Corporate Information.” Beginning late afternoon on July 23, 2021, an archived version of the webcast can be accessed from this same subsection of the website. The archived webcast will be available for one year.
About Seacoast Banking Corporation of Florida (NASDAQ: SBCF)
Seacoast Banking Corporation of Florida is one of the largest community banks headquartered in Florida with approximately $9.3 billion in assets and $7.8 billion in deposits as of June 30, 2021. The Company provides integrated financial services including commercial and retail banking, wealth management, and mortgage services to customers through advanced banking solutions, and 48 traditional branches of its locally-branded, wholly-owned subsidiary bank, Seacoast National Bank. Offices stretch from Fort Lauderdale, Boca Raton and West Palm Beach north through the Daytona Beach area, into Orlando and Central Florida and the adjacent Tampa market, and west to Okeechobee and surrounding counties. More information about the Company is available at www.SeacoastBanking.com.
Additional Information
Seacoast has filed a registration statement on Form S-4, as amended, with the United States Securities and Exchange Commission (the "SEC") in connection with the proposed merger of Legacy Bank of Florida ("Legacy Bank") with and into Seacoast Bank. The registration statement in connection with the Legacy Bank merger includes a proxy statement of Legacy Bank and a prospectus of Seacoast. A definitive proxy statement/prospectus has been mailed to shareholders of Legacy Bank. This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval. WE URGE INVESTORS TO READ THE PROXY STATEMENTS/PROSPECTUSES AND ANY OTHER DOCUMENTS TO BE FILED WITH THE SEC IN CONNECTION WITH THE MERGER OR INCORPORATED BY REFERENCE IN THE PROXY STATEMENTS/PROSPECTUSES BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION.
Investors may obtain (when available) these documents free of charge at the SEC’s website (www.sec.gov). In addition, documents filed with the SEC by Seacoast will be available free of charge by contacting Investor Relations at (772) 288-6085.
Legacy Bank, its directors, and executive officers and other members of management and employees may be considered participants in the solicitation of proxies in connection with the proposed merger of Legacy Bank with and into Seacoast Bank. Information regarding the participants in the proxy solicitation of Legacy Bank and a description of its direct and indirect interests, by security holdings or otherwise, is contained in the proxy statement/prospectus and other relevant materials to be filed with the SEC.
Cautionary Notice Regarding Forward-Looking Statements
This press release contains "forward-looking statements" within the meaning, and protections, of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including, without limitation, statements about future financial and operating results, loan growth, cost savings, enhanced revenues, economic and seasonal conditions in our markets, and improvements to reported earnings that may be realized from cost controls, tax law changes, new initiatives and for integration of banks that we have acquired, or expect to acquire, including Legacy Bank of Florida, as well as statements with respect to Seacoast's objectives, strategic plans,
expectations and intentions and other statements that are not historical facts, any of which may be impacted by the COVID-19 pandemic and any variants thereof and related effects on the U.S. economy. Actual results may differ from those set forth in the forward-looking statements.
Forward-looking statements include statements with respect to our beliefs, plans, objectives, goals, expectations, anticipations, assumptions, estimates and intentions about future performance and involve known and unknown risks, uncertainties and other factors, which may be beyond our control, and which may cause the actual results, performance or achievements of Seacoast to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. You should not expect us to update any forward-looking statements.
All statements other than statements of historical fact could be forward-looking statements. You can identify these forward-looking statements through our use of words such as "may", "will", "anticipate", "assume", "should", "support", "indicate", "would", "believe", "contemplate", "expect", "estimate", "continue", "further", "plan", "point to", "project", "could", "intend", "target" or other similar words and expressions of the future. These forward-looking statements may not be realized due to a variety of factors, including, without limitation: the effects of future economic and market conditions, including seasonality and the adverse impact of COVID-19 (economic and otherwise); governmental monetary and fiscal policies, including interest rate policies of the Board of Governors of the Federal Reserve, as well as legislative, tax and regulatory changes, including those that impact the money supply and inflation; changes in accounting policies, rules and practices, including the impact of the adoption of CECL; our participation in the Paycheck Protection Program ("PPP"); the risks of changes in interest rates on the level and composition of deposits, loan demand, liquidity and the values of loan collateral, securities, and interest sensitive assets and liabilities; interest rate risks, sensitivities and the shape of the yield curve; uncertainty related to the impact of LIBOR calculations on securities and loans; changes in borrower credit risks and payment behaviors; changing retail distribution strategies, customer preferences and behavior; changes in the availability and cost of credit and capital in the financial markets; changes in the prices, values and sales volumes of residential and commercial real estate; our ability to comply with any regulatory requirements; the effects of problems encountered by other financial institutions that adversely affect us or the banking industry; our concentration in commercial real estate loans; inaccuracies or other failures from the use of models, including the failure of assumptions and estimates, as well as differences in, and changes to, economic, market and credit conditions; the impact on the valuation of our investments due to market volatility or counterparty payment risk; statutory and regulatory dividend restrictions; increases in regulatory capital requirements for banking organizations generally; the risks of mergers, acquisitions and divestitures, including our ability to continue to identify acquisition targets and successfully acquire desirable financial institutions; changes in technology or products that may be more difficult, costly, or less effective than anticipated; our ability to identify and address increased cybersecurity risks; inability of our risk management framework to manage risks associated with our business; dependence on key suppliers or vendors to obtain equipment or services for our business on acceptable terms; reduction in or the termination of our ability to use the mobile-based platform that is critical to our business growth strategy; the effects of war or other conflicts, acts of terrorism, natural disasters, health emergencies, epidemics or pandemics, or other catastrophic events that may affect general economic conditions; unexpected outcomes of and the costs associated with, existing or new litigation involving us; our ability to maintain adequate internal controls over financial reporting; potential claims, damages, penalties, fines and reputational damage resulting from pending or future litigation, regulatory proceedings and enforcement actions; the risks that our deferred tax assets could be reduced if estimates of future taxable income from our operations and tax planning strategies are less than currently estimated and sales of our capital stock could trigger a reduction in the amount of net operating loss carryforwards that we may be able to utilize for income tax purposes; the effects of competition from other commercial banks, thrifts, mortgage banking firms, consumer finance companies, credit unions, securities brokerage firms, insurance companies, money market and other mutual funds and other financial institutions operating in our market areas and elsewhere, including institutions operating regionally, nationally and internationally, together with such competitors offering banking products and services by mail, telephone, computer and the Internet; and the failure of assumptions underlying the establishment of reserves for possible loan losses.
The risks relating to the Legacy Bank of Florida proposed merger include, without limitation: the timing to consummate the proposed merger; the risk that a condition to closing of the proposed merger may not be satisfied; the risk that the merger is not completed at all; the diversion of management time on issues related to the proposed merger; unexpected transaction costs, including the costs of integrating operations; the risks that the businesses will not be integrated successfully or such integration may be more difficult, time-consuming or costly than expected; the potential failure to fully or timely realize expected revenues and revenue synergies, including as the result of revenues following the merger being lower than expected; the risk of deposit and customer attrition; any changes in deposit mix; unexpected operating and other costs, which may differ or change from expectation; the risk of customer and employee loss and business disruptions, including, without limitation, as the result of difficulties in maintaining relationships with employees; increased competitive pressures on solicitations of customers by competitors; as well as difficulties and risks inherent with entering new markets.
Actual results and capital and other financial conditions may differ materially from those included in these statements due to a variety of factors. These factors include, among others described above, macroeconomic and other challenges and uncertainties related to the COVID-19 pandemic, such as the duration and severity of the impact on public health, the U.S. and global economies, financial markets and consumer and corporate customers and clients, including economic activity and employment, as well as the various actions taken in response by governments, central banks and others, including Seacoast, and the precautionary statements included in this release.
All written or oral forward-looking statements attributable to us are expressly qualified in their entirety by this cautionary notice, including, without limitation, those risks and uncertainties described in our annual report on Form 10-K for the year ended December 31, 2020 and quarterly report on Form 10-Q for the quarter ended March 31, 2021 under "Special Cautionary Notice Regarding Forward-looking Statements" and "Risk Factors", and otherwise in our SEC reports and filings. Such reports are available upon request from the Company, or from the Securities and Exchange Commission, including through the SEC's Internet website at www.sec.gov.
| FINANCIAL HIGHLIGHTS | (Unaudited) | ||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES | |||||||||||||||||||||
| Quarterly Trends | Six Months Ended | ||||||||||||||||||||
| (Amounts in thousands, except ratios and per share data) | 2Q'21 | 1Q'21 | 4Q'20 | 3Q'20 | 2Q'20 | 2Q'21 | 2Q'20 | ||||||||||||||
| Summary of Earnings | |||||||||||||||||||||
| Net income | $ | 31,410 | $ | 33,719 | $ | 29,347 | $ | 22,628 | $ | 25,080 | $ | 65,129 | $ | 25,789 | |||||||
| Adjusted net income1 | 33,251 | 35,497 | 30,700 | 27,336 | 25,452 | 68,748 | 30,914 | ||||||||||||||
| Net interest income2 | 65,933 | 66,741 | 68,903 | 63,621 | 67,388 | 132,674 | 130,679 | ||||||||||||||
| Net interest margin2,3 | 3.23 | % | 3.51 | % | 3.59 | % | 3.40 | % | 3.70 | % | 3.37 | % | 3.81 | % | |||||||
| Performance Ratios | |||||||||||||||||||||
| Return on average assets-GAAP basis3 | 1.40 | % | 1.61 | % | 1.39 | % | 1.11 | % | 1.27 | % | 1.50 | % | 0.69 | % | |||||||
| Return on average tangible assets-GAAP basis3,4 | 1.48 | 1.70 | 1.49 | 1.20 | 1.37 | 1.58 | 0.78 | ||||||||||||||
| Adjusted return on average tangible assets1,3,4 | 1.52 | 1.75 | 1.50 | 1.38 | 1.33 | 1.63 | 0.86 | ||||||||||||||
| Net adjusted noninterest expense to average tangible assets1,3,4 | 1.98 | 2.16 | 2.00 | 2.24 | 2.11 | 2.07 | 2.28 | ||||||||||||||
| Return on average shareholders' equity-GAAP basis3 | 10.76 | 12.03 | 10.51 | 8.48 | 9.96 | 11.39 | 5.17 | ||||||||||||||
| Return on average tangible common equity-GAAP basis3,4 | 13.88 | 15.62 | 13.87 | 11.35 | 13.47 | 14.73 | 7.27 | ||||||||||||||
| Adjusted return on average tangible common equity1,3,4 | 14.27 | 16.01 | 14.00 | 13.06 | 13.09 | 15.12 | 8.02 | ||||||||||||||
| Efficiency ratio5 | 54.93 | 53.21 | 48.23 | 61.65 | 50.11 | 54.05 | 54.88 | ||||||||||||||
| Adjusted efficiency ratio1 | 53.49 | 51.99 | 48.75 | 54.82 | 49.60 | 52.72 | 51.53 | ||||||||||||||
| Noninterest income to total revenue (excluding securities gains/losses) | 18.94 | 21.07 | 17.85 | 21.06 | 17.00 | 20.03 | 17.90 | ||||||||||||||
| Tangible common equity to tangible assets4 | 10.43 | 10.71 | 11.01 | 10.67 | 10.19 | 10.43 | 10.19 | ||||||||||||||
| Average loan-to-deposit ratio | 74.13 | 81.39 | 84.48 | 87.83 | 88.48 | 77.62 | 90.59 | ||||||||||||||
| End of period loan-to-deposit ratio | 69.93 | 77.48 | 83.72 | 85.77 | 87.40 | 69.93 | 87.40 | ||||||||||||||
| Per Share Data | |||||||||||||||||||||
| Net income diluted-GAAP basis | $ | 0.56 | $ | 0.60 | $ | 0.53 | $ | 0.42 | $ | 0.47 | $ | 1.17 | $ | 0.49 | |||||||
| Net income basic-GAAP basis | 0.57 | 0.61 | 0.53 | 0.42 | 0.47 | 1.18 | 0.49 | ||||||||||||||
| Adjusted earnings1 | 0.59 | 0.63 | 0.55 | 0.50 | 0.48 | 1.23 | 0.59 | ||||||||||||||
| Book value per share common | 21.33 | 20.89 | 20.46 | 19.91 | 19.45 | 21.33 | 19.45 | ||||||||||||||
| Tangible book value per share | 17.08 | 16.62 | 16.16 | 15.57 | 15.11 | 17.08 | 15.11 | ||||||||||||||
| Cash dividends declared | 0.13 | — | — | — | — | 0.13 | — | ||||||||||||||
| 1Non-GAAP measure - see "Explanation of Certain Unaudited Non-GAAP Financial Measures" for more information and a reconciliation to GAAP. | |||||||||||||||||||||
| 2Calculated on a fully taxable equivalent basis using amortized cost. | |||||||||||||||||||||
| 3These ratios are stated on an annualized basis and are not necessarily indicative of future periods. | |||||||||||||||||||||
| 4The Company defines tangible assets as total assets less intangible assets, and tangible common equity as total shareholders' equity less intangible assets. | |||||||||||||||||||||
| 5Defined as noninterest expense less amortization of intangibles and gains, losses, and expenses on foreclosed properties divided by net operating revenue (net interest income on a fully taxable equivalent basis plus noninterest income excluding securities gains and losses). | |||||||||||||||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF INCOME | (Unaudited) | ||||||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | |||||||
| SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES | |||||||||||||||||||||
| Quarterly Trends | Six Months Ended | ||||||||||||||||||||
| (Amounts in thousands, except per share data) | 2Q'21 | 1Q'21 | 4Q'20 | 3Q'20 | 2Q'20 | 2Q'21 | 2Q'20 | ||||||||||||||
| Interest on securities: | |||||||||||||||||||||
| Taxable | $ | 6,559 | $ | 6,298 | $ | 6,477 | $ | 6,972 | $ | 7,573 | $ | 12,857 | $ | 16,269 | |||||||
| Nontaxable | 147 | 148 | 86 | 125 | 121 | 295 | 243 | ||||||||||||||
| Fees on PPP loans | 3,877 | 5,390 | 3,603 | 161 | 4,010 | 9,267 | 4,010 | ||||||||||||||
| Interest on PPP loans | 1,251 | 1,496 | 1,585 | 1,558 | 1,058 | 2,747 | 1,058 | ||||||||||||||
| Interest and fees on loans - excluding PPP loans | 55,220 | 55,412 | 60,407 | 58,768 | 59,776 | 110,632 | 123,216 | ||||||||||||||
| Interest on federal funds sold and other investments | 709 | 586 | 523 | 556 | 684 | 1,295 | 1,418 | ||||||||||||||
| Total Interest Income | 67,763 | 69,330 | 72,681 | 68,140 | 73,222 | 137,093 | 146,214 | ||||||||||||||
| Interest on deposits | 980 | 1,065 | 1,228 | 1,299 | 1,203 | 2,045 | 4,393 | ||||||||||||||
| Interest on time certificates | 524 | 1,187 | 2,104 | 2,673 | 3,820 | 1,711 | 8,588 | ||||||||||||||
| Interest on borrowed money | 457 | 468 | 558 | 665 | 927 | 925 | 2,784 | ||||||||||||||
| Total Interest Expense | 1,961 | 2,720 | 3,890 | 4,637 | 5,950 | 4,681 | 15,765 | ||||||||||||||
| Net Interest Income | 65,802 | 66,610 | 68,791 | 63,503 | 67,272 | 132,412 | 130,449 | ||||||||||||||
| Provision for credit losses | (4,855) | (5,715) | 1,900 | (845) | 7,611 | (10,570) | 37,124 | ||||||||||||||
| Net Interest Income After Provision for Credit Losses | 70,657 | 72,325 | 66,891 | 64,348 | 59,661 | 142,982 | 93,325 | ||||||||||||||
| Noninterest income: | |||||||||||||||||||||
| Service charges on deposit accounts | 2,338 | 2,338 | 2,423 | 2,242 | 1,939 | 4,676 | 4,764 | ||||||||||||||
| Interchange income | 4,145 | 3,820 | 3,596 | 3,682 | 3,187 | 7,965 | 6,433 | ||||||||||||||
| Wealth management income | 2,387 | 2,323 | 1,949 | 1,972 | 1,719 | 4,710 | 3,586 | ||||||||||||||
| Mortgage banking fees | 2,977 | 4,225 | 3,646 | 5,283 | 3,559 | 7,202 | 5,767 | ||||||||||||||
| Marine finance fees | 177 | 189 | 145 | 242 | 157 | 366 | 303 | ||||||||||||||
| SBA gains | 232 | 287 | 113 | 252 | 181 | 519 | 320 | ||||||||||||||
| BOLI income | 872 | 859 | 889 | 899 | 887 | 1,731 | 1,773 | ||||||||||||||
| Other | 2,249 | 3,744 | 2,187 | 2,370 | 2,147 | 5,993 | 5,499 | ||||||||||||||
| 15,377 | 17,785 | 14,948 | 16,942 | 13,776 | 33,162 | 28,445 | |||||||||||||||
| Securities (losses) gains, net | (55) | (114) | (18) | 4 | 1,230 | (169) | 1,249 | ||||||||||||||
| Total Noninterest Income | 15,322 | 17,671 | 14,930 | 16,946 | 15,006 | 32,993 | 29,694 | ||||||||||||||
| Noninterest expenses: | |||||||||||||||||||||
| Salaries and wages | 22,966 | 21,393 | 21,490 | 23,125 | 20,226 | 44,359 | 43,924 | ||||||||||||||
| Employee benefits | 3,953 | 4,980 | 3,915 | 3,995 | 3,379 | 8,933 | 7,634 | ||||||||||||||
| Outsourced data processing costs | 4,676 | 4,468 | 4,233 | 6,128 | 4,059 | 9,144 | 8,692 | ||||||||||||||
| Telephone / data lines | 838 | 785 | 774 | 705 | 791 | 1,623 | 1,505 | ||||||||||||||
| Occupancy | 3,310 | 3,789 | 3,554 | 3,858 | 3,385 | 7,099 | 6,738 | ||||||||||||||
| Furniture and equipment | 1,166 | 1,254 | 1,317 | 1,576 | 1,358 | 2,420 | 2,981 | ||||||||||||||
| Marketing | 1,002 | 1,168 | 1,045 | 1,513 | 997 | 2,170 | 2,275 | ||||||||||||||
| Legal and professional fees | 2,182 | 2,582 | 509 | 3,018 | 2,277 | 4,764 | 5,640 | ||||||||||||||
| FDIC assessments | 515 | 526 | 528 | 474 | 266 | 1,041 | 266 | ||||||||||||||
| Amortization of intangibles | 1,212 | 1,211 | 1,421 | 1,497 | 1,483 | 2,423 | 2,939 | ||||||||||||||
| Foreclosed property expense and net (gain) loss on sale | (90) | (65) | 1,821 | 512 | 245 | (155) | (70) | ||||||||||||||
| Provision for credit losses on unfunded commitments | — | — | (795) | 756 | 178 | — | 224 | ||||||||||||||
| Other | 4,054 | 4,029 | 3,869 | 4,517 | 3,755 | 8,083 | 7,449 | ||||||||||||||
| Total Noninterest Expense | 45,784 | 46,120 | 43,681 | 51,674 | 42,399 | 91,904 | 90,197 | ||||||||||||||
| Income Before Income Taxes | 40,195 | 43,876 | 38,140 | 29,620 | 32,268 | 84,071 | 32,822 | ||||||||||||||
| Income taxes | 8,785 | 10,157 | 8,793 | 6,992 | 7,188 | 18,942 | 7,033 | ||||||||||||||
| Net Income | $ | 31,410 | $ | 33,719 | $ | 29,347 | $ | 22,628 | $ | 25,080 | $ | 65,129 | $ | 25,789 | |||||||
| Per share of common stock: | |||||||||||||||||||||
| Net income diluted | $ | 0.56 | $ | 0.60 | $ | 0.53 | $ | 0.42 | $ | 0.47 | $ | 1.17 | $ | 0.49 | |||||||
| Net income basic | 0.57 | 0.61 | 0.53 | 0.42 | 0.47 | 1.18 | 0.49 | ||||||||||||||
| Cash dividends declared | 0.13 | — | — | — | — | 0.13 | — | ||||||||||||||
| Average diluted shares outstanding | 55,901 | 55,992 | 55,739 | 54,301 | 53,308 | 55,827 | 52,807 | ||||||||||||||
| Average basic shares outstanding | 55,421 | 55,271 | 55,219 | 53,978 | 52,985 | 55,347 | 52,394 | ||||||||||||||
| CONDENSED CONSOLIDATED BALANCE SHEETS | (Unaudited) | ||||||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | ||||||||||
| SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES | |||||||||||||||||||||
| June 30, | March 31, | December 31, | September 30, | June 30, | |||||||||||||||||
| (Amounts in thousands) | 2021 | 2021 | 2020 | 2020 | 2020 | ||||||||||||||||
| Assets | |||||||||||||||||||||
| Cash and due from banks | $ | 97,468 | $ | 89,123 | $ | 86,630 | $ | 81,692 | $ | 84,178 | |||||||||||
| Interest bearing deposits with other banks | 1,351,377 | 890,202 | 317,458 | 227,876 | 440,142 | ||||||||||||||||
| Total Cash and Cash Equivalents | 1,448,845 | 979,325 | 404,088 | 309,568 | 524,320 | ||||||||||||||||
| Time deposits with other banks | 750 | 750 | 750 | 2,247 | 2,496 | ||||||||||||||||
| Debt Securities: | |||||||||||||||||||||
| Available for sale (at fair value) | 1,322,776 | 1,051,396 | 1,398,157 | 1,286,858 | 976,025 | ||||||||||||||||
| Held to maturity (at amortized cost) | 493,467 | 512,307 | 184,484 | 207,376 | 227,092 | ||||||||||||||||
| Total Debt Securities | 1,816,243 | 1,563,703 | 1,582,641 | 1,494,234 | 1,203,117 | ||||||||||||||||
| Loans held for sale | 42,793 | 60,924 | 68,890 | 73,046 | 54,943 | ||||||||||||||||
| Loans | 5,437,049 | 5,661,492 | 5,735,349 | 5,858,029 | 5,772,052 | ||||||||||||||||
| Less: Allowance for credit losses | (81,127) | (86,643) | (92,733) | (94,013) | (91,250) | ||||||||||||||||
| Net Loans | 5,355,922 | 5,574,849 | 5,642,616 | 5,764,016 | 5,680,802 | ||||||||||||||||
| Bank premises and equipment, net | 69,392 | 70,385 | 75,117 | 76,393 | 69,041 | ||||||||||||||||
| Other real estate owned | 12,804 | 15,549 | 12,750 | 15,890 | 15,847 | ||||||||||||||||
| Goodwill | 221,176 | 221,176 | 221,176 | 221,176 | 212,146 | ||||||||||||||||
| Other intangible assets, net | 14,106 | 15,382 | 16,745 | 18,163 | 17,950 | ||||||||||||||||
| Bank owned life insurance | 158,506 | 132,634 | 131,776 | 130,887 | 127,954 | ||||||||||||||||
| Net deferred tax assets | 21,839 | 24,497 | 23,629 | 25,503 | 21,404 | ||||||||||||||||
| Other assets | 154,457 | 152,646 | 162,214 | 156,717 | 153,993 | ||||||||||||||||
| Total Assets | $ | 9,316,833 | $ | 8,811,820 | $ | 8,342,392 | $ | 8,287,840 | $ | 8,084,013 | |||||||||||
| Liabilities and Shareholders' Equity | |||||||||||||||||||||
| Liabilities | |||||||||||||||||||||
| Deposits | |||||||||||||||||||||
| Noninterest demand | $ | 2,952,160 | $ | 2,685,247 | $ | 2,289,787 | $ | 2,400,744 | $ | 2,267,435 | |||||||||||
| Interest-bearing demand | 1,763,884 | 1,647,935 | 1,566,069 | 1,385,445 | 1,368,146 | ||||||||||||||||
| Savings | 811,516 | 768,362 | 689,179 | 655,072 | 619,251 | ||||||||||||||||
| Money market | 1,807,190 | 1,671,179 | 1,556,370 | 1,457,078 | 1,232,892 | ||||||||||||||||
| Other time certificates | 335,370 | 373,297 | 425,878 | 457,964 | 445,176 | ||||||||||||||||
| Brokered time certificates | 20,000 | 93,500 | 233,815 | 381,028 | 572,465 | ||||||||||||||||
| Time certificates of more than $250,000 | 146,316 | 146,229 | 171,463 | 177,512 | 161,418 | ||||||||||||||||
| Total Deposits | 7,836,436 | 7,385,749 | 6,932,561 | 6,914,843 | 6,666,783 | ||||||||||||||||
| Securities sold under agreements to repurchase | 119,973 | 109,171 | 119,609 | 89,508 | 92,125 | ||||||||||||||||
| Federal Home Loan Bank borrowings | — | — | — | 35,000 | 135,000 | ||||||||||||||||
| Subordinated debt | 71,506 | 71,436 | 71,365 | 71,295 | 71,225 | ||||||||||||||||
| Other liabilities | 106,571 | 90,115 | 88,455 | 78,853 | 88,277 | ||||||||||||||||
| Total Liabilities | 8,134,486 | 7,656,471 | 7,211,990 | 7,189,499 | 7,053,410 | ||||||||||||||||
| Shareholders' Equity | |||||||||||||||||||||
| Common stock | 5,544 | 5,529 | 5,524 | 5,517 | 5,299 | ||||||||||||||||
| Additional paid in capital | 862,598 | 858,688 | 856,092 | 854,188 | 811,328 | ||||||||||||||||
| Retained earnings | 314,584 | 290,420 | 256,701 | 227,354 | 204,719 | ||||||||||||||||
| Treasury stock | (10,180) | (8,693) | (8,285) | (7,941) | (8,037) | ||||||||||||||||
| 1,172,546 | 1,145,944 | 1,110,032 | 1,079,118 | 1,013,309 | |||||||||||||||||
| Accumulated other comprehensive income, net | 9,801 | 9,405 | 20,370 | 19,223 | 17,294 | ||||||||||||||||
| Total Shareholders' Equity | 1,182,347 | 1,155,349 | 1,130,402 | 1,098,341 | 1,030,603 | ||||||||||||||||
| Total Liabilities & Shareholders' Equity | $ | 9,316,833 | $ | 8,811,820 | $ | 8,342,392 | $ | 8,287,840 | $ | 8,084,013 | |||||||||||
| Common shares outstanding | 55,436 | 55,294 | 55,243 | 55,169 | 52,991 | ||||||||||||||||
| CONSOLIDATED QUARTERLY FINANCIAL DATA | (Unaudited) | ||||||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | ||||||
| SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES | |||||||||||||||||||||
| (Amounts in thousands) | 1Q'21 | 4Q'20 | 3Q'20 | 2Q'20 | |||||||||||||||||
| Credit Analysis | |||||||||||||||||||||
| Net charge-offs - non-acquired loans | 214 | $ | 292 | $ | 3,028 | $ | 1,112 | $ | 1,714 | ||||||||||||
| Net charge-offs - acquired loans | 78 | 99 | 624 | 37 | |||||||||||||||||
| Total Net Charge-offs | 370 | 3,127 | 1,736 | 1,751 | |||||||||||||||||
| Net charge-offs to average loans - non-acquired loans | % | 0.02 | % | 0.20 | % | 0.08 | % | 0.12 | % | ||||||||||||
| Net charge-offs to average loans - acquired loans | 0.01 | 0.01 | 0.04 | — | |||||||||||||||||
| Total Net Charge-offs to Average Loans | 0.03 | 0.21 | 0.12 | 0.12 | |||||||||||||||||
| Allowance for credit losses - non-acquired loans | 64,525 | $ | 66,523 | $ | 69,786 | $ | 70,388 | $ | 73,587 | ||||||||||||
| Allowance for credit losses - acquired loans | 20,120 | 22,947 | 23,625 | 17,663 | |||||||||||||||||
| Total Allowance for Credit Losses | 81,127 | $ | 86,643 | $ | 92,733 | $ | 94,013 | $ | 91,250 | ||||||||||||
| Non-acquired loans at end of period | 4,290,622 | $ | 4,208,911 | $ | 4,196,205 | $ | 4,157,376 | $ | 4,315,892 | ||||||||||||
| Acquired loans at end of period | 870,928 | 972,183 | 1,061,853 | 879,710 | |||||||||||||||||
| Paycheck Protection Program loans at end of period1 | 581,653 | 566,961 | 638,800 | 576,450 | |||||||||||||||||
| Total Loans | 5,437,049 | $ | 5,661,492 | $ | 5,735,349 | $ | 5,858,029 | $ | 5,772,052 | ||||||||||||
| Non-acquired loans allowance for credit losses to non-acquired loans at end of period | % | 1.58 | % | 1.66 | % | 1.69 | % | 1.71 | % | ||||||||||||
| Total allowance for credit losses to total loans at end of period | 1.53 | 1.62 | 1.60 | 1.58 | |||||||||||||||||
| Total allowance for credit losses to total loans, excluding PPP loans | 1.71 | 1.79 | 1.80 | 1.76 | |||||||||||||||||
| Purchase discount on acquired loans at end of period | 2.93 | 2.86 | 3.01 | 3.29 | |||||||||||||||||
| End of Period | |||||||||||||||||||||
| Nonperforming loans | 32,920 | $ | 35,328 | $ | 36,110 | $ | 36,897 | $ | 30,051 | ||||||||||||
| Other real estate owned | 10,836 | 10,182 | 12,299 | 10,967 | |||||||||||||||||
| Properties previously used in bank operations included in other real estate owned | 4,713 | 2,569 | 3,592 | 4,880 | |||||||||||||||||
| Total Nonperforming Assets | 45,724 | $ | 50,877 | $ | 48,861 | $ | 52,788 | $ | 45,898 | ||||||||||||
| Accruing troubled debt restructures (TDRs) | 4,037 | $ | 4,067 | $ | 4,182 | $ | 10,190 | $ | 10,338 | ||||||||||||
| Nonperforming Loans to Loans at End of Period | % | 0.62 | % | 0.63 | % | 0.63 | % | 0.52 | % | ||||||||||||
| Nonperforming Assets to Total Assets at End of Period | 0.58 | 0.59 | 0.64 | 0.57 | |||||||||||||||||
| March 31, | December 31, | September 30, | June 30, | ||||||||||||||||||
| Loans | 2021 | 2020 | 2020 | 2020 | |||||||||||||||||
| Construction and land development | 234,347 | $ | 227,117 | $ | 245,108 | $ | 280,610 | $ | 298,835 | ||||||||||||
| Commercial real estate - owner occupied | 1,133,085 | 1,141,310 | 1,125,460 | 1,076,650 | |||||||||||||||||
| Commercial real estate - non-owner occupied | 1,438,365 | 1,395,854 | 1,394,464 | 1,392,787 | |||||||||||||||||
| Residential real estate | 1,246,549 | 1,342,628 | 1,393,396 | 1,468,171 | |||||||||||||||||
| Commercial and financial | 860,813 | 854,753 | 833,083 | 757,232 | |||||||||||||||||
| Consumer | 173,910 | 188,735 | 192,216 | 201,927 | |||||||||||||||||
| Paycheck Protection Program | 581,653 | 566,961 | 638,800 | 576,450 | |||||||||||||||||
| Total Loans | 5,437,049 | $ | 5,661,492 | $ | 5,735,349 | $ | 5,858,029 | $ | 5,772,052 | ||||||||||||
| 13Q'20 includes 54 million in Paycheck Protection Program loans acquired from Freedom Bank. |
All values are in US Dollars.
| AVERAGE BALANCES, INTEREST INCOME AND EXPENSES, YIELDS AND RATES 1 | (Unaudited) | |||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES | ||||||||||||||||||
| 2Q'21 | 1Q'21 | 2Q'20 | ||||||||||||||||
| Average | Yield/ | Average | Yield/ | Average | Yield/ | |||||||||||||
| (Amounts in thousands) | Balance | Interest | Rate | Balance | Interest | Rate | Balance | Interest | Rate | |||||||||
| Assets | ||||||||||||||||||
| Earning assets: | ||||||||||||||||||
| Securities: | ||||||||||||||||||
| Taxable | $ | 1,629,410 | $ | 6,559 | 1.61 | % | $ | 1,550,457 | $ | 6,298 | 1.62 | % | $ | 1,135,698 | $ | 7,573 | 2.67 | % |
| Nontaxable | 25,581 | 186 | 2.90 | 25,932 | 187 | 2.89 | 19,347 | 152 | 3.14 | |||||||||
| Total Securities | 1,654,991 | 6,745 | 1.63 | 1,576,389 | 6,485 | 1.65 | 1,155,045 | 7,725 | 2.68 | |||||||||
| Federal funds sold and other investments | 925,323 | 709 | 0.31 | 377,344 | 586 | 0.63 | 433,626 | 684 | 0.63 | |||||||||
| Loans excluding PPP loans | 5,092,897 | 55,313 | 4.36 | 5,149,642 | 55,504 | 4.37 | 5,304,381 | 59,861 | 4.54 | |||||||||
| PPP loans | 505,339 | 5,127 | 4.07 | 609,733 | 6,886 | 4.58 | 424,171 | 5,068 | 4.81 | |||||||||
| Total Loans | 5,598,236 | 60,440 | 4.33 | 5,759,375 | 62,390 | 4.39 | 5,728,552 | 64,929 | 4.56 | |||||||||
| Total Earning Assets | 8,178,550 | 67,894 | 3.33 | 7,713,108 | 69,461 | 3.65 | 7,317,223 | 73,338 | 4.03 | |||||||||
| Allowance for credit losses | (86,042) | (91,735) | (84,965) | |||||||||||||||
| Cash and due from banks | 327,171 | 255,685 | 103,919 | |||||||||||||||
| Premises and equipment | 70,033 | 74,272 | 71,173 | |||||||||||||||
| Intangible assets | 235,964 | 237,323 | 230,871 | |||||||||||||||
| Bank owned life insurance | 133,484 | 132,079 | 127,386 | |||||||||||||||
| Other assets | 166,686 | 164,622 | 147,395 | |||||||||||||||
| Total Assets | $ | 9,025,846 | $ | 8,485,354 | $ | 7,913,002 | ||||||||||||
| Liabilities and Shareholders' Equity | ||||||||||||||||||
| Interest-bearing liabilities: | ||||||||||||||||||
| Interest-bearing demand | $ | 1,692,178 | $ | 235 | 0.06 | % | $ | 1,600,490 | $ | 258 | 0.07 | % | $ | 1,298,639 | $ | 297 | 0.09 | % |
| Savings | 790,734 | 118 | 0.06 | 722,274 | 137 | 0.08 | 591,040 | 165 | 0.11 | |||||||||
| Money market | 1,736,481 | 627 | 0.14 | 1,609,938 | 670 | 0.17 | 1,193,969 | 741 | 0.25 | |||||||||
| Time deposits | 533,350 | 524 | 0.39 | 711,320 | 1,187 | 0.68 | 1,293,766 | 3,820 | 1.19 | |||||||||
| Securities sold under agreements to repurchase | 115,512 | 35 | 0.12 | 112,834 | 41 | 0.15 | 74,717 | 34 | 0.18 | |||||||||
| Federal Home Loan Bank borrowings | — | — | — | — | — | — | 199,698 | 312 | 0.63 | |||||||||
| Other borrowings | 71,460 | 422 | 2.37 | 71,390 | 427 | 2.43 | 71,185 | 581 | 3.28 | |||||||||
| Total Interest-Bearing Liabilities | 4,939,715 | 1,961 | 0.16 | 4,828,246 | 2,720 | 0.23 | 4,723,014 | 5,950 | 0.51 | |||||||||
| Noninterest demand | 2,799,643 | 2,432,038 | 2,097,038 | |||||||||||||||
| Other liabilities | 116,093 | 88,654 | 79,855 | |||||||||||||||
| Total Liabilities | 7,855,451 | 7,348,938 | 6,899,907 | |||||||||||||||
| Shareholders' equity | 1,170,395 | 1,136,416 | 1,013,095 | |||||||||||||||
| Total Liabilities & Equity | $ | 9,025,846 | $ | 8,485,354 | $ | 7,913,002 | ||||||||||||
| Cost of deposits | 0.08 | % | 0.13 | % | 0.31 | % | ||||||||||||
| Interest expense as a % of earning assets | 0.10 | % | 0.14 | % | 0.33 | % | ||||||||||||
| Net interest income as a % of earning assets | $ | 65,933 | 3.23 | % | $ | 66,741 | 3.51 | % | $ | 67,388 | 3.70 | % | ||||||
| 1On a fully taxable equivalent basis. All yields and rates have been computed using amortized cost. | ||||||||||||||||||
| Fees on loans have been included in interest on loans. Nonaccrual loans are included in loan balances. | ||||||||||||||||||
| Six Months Ended June 30, 2021 | Six Months Ended June 30, 2020 | |||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | ||||||||
| Average | Yield/ | Average | Yield/ | |||||||||||||||
| (Amounts in thousands, except ratios) | Balance | Interest | Rate | Balance | Interest | Rate | ||||||||||||
| Assets | ||||||||||||||||||
| Earning assets: | ||||||||||||||||||
| Securities: | ||||||||||||||||||
| Taxable | $ | 1,590,152 | $ | 12,857 | 1.62 | % | $ | 1,144,086 | $ | 16,269 | 2.84 | % | ||||||
| Nontaxable | 25,756 | 373 | 2.90 | 19,544 | 304 | 3.11 | ||||||||||||
| Total Securities | 1,615,908 | 13,230 | 1.64 | 1,163,630 | 16,573 | 2.85 | ||||||||||||
| Federal funds sold and other investments | 652,847 | 1,295 | 0.40 | 260,775 | 1,418 | 1.09 | ||||||||||||
| Loans excluding PPP loans | 5,121,114 | 110,817 | 4.36 | 5,259,808 | 123,385 | 4.72 | ||||||||||||
| PPP loans | 557,247 | 12,013 | 4.35 | 212,085 | 5,068 | 4.81 | ||||||||||||
| Total Loans | 5,678,361 | 122,830 | 4.36 | 5,471,893 | 128,453 | 4.72 | ||||||||||||
| Total Earning Assets | 7,947,116 | 137,355 | 3.49 | 6,896,298 | 146,444 | 4.27 | ||||||||||||
| Allowance for credit losses | (88,873) | (70,948) | ||||||||||||||||
| Cash and due from banks | 291,626 | 97,002 | ||||||||||||||||
| Premises and equipment | 72,141 | 69,379 | ||||||||||||||||
| Intangible assets | 236,640 | 228,791 | ||||||||||||||||
| Bank owned life insurance | 132,785 | 126,939 | ||||||||||||||||
| Other assets | 165,658 | 136,811 | ||||||||||||||||
| Total Assets | $ | 8,757,093 | $ | 7,484,272 | ||||||||||||||
| Liabilities and Shareholders' Equity | ||||||||||||||||||
| Interest-bearing liabilities: | ||||||||||||||||||
| Interest-bearing demand | $ | 1,646,587 | $ | 493 | 0.06 | % | $ | 1,236,285 | $ | 1,131 | 0.18 | % | ||||||
| Savings | 756,693 | 255 | 0.07 | 558,883 | 513 | 0.18 | ||||||||||||
| Money market | 1,673,559 | 1,297 | 0.16 | 1,161,363 | 2,749 | 0.48 | ||||||||||||
| Time deposits | 621,844 | 1,711 | 0.55 | 1,222,758 | 8,588 | 1.41 | ||||||||||||
| Securities sold under agreements to repurchase | 114,181 | 76 | 0.13 | 72,891 | 201 | 0.55 | ||||||||||||
| Federal Home Loan Bank borrowings | — | — | — | 224,860 | 1,279 | 1.14 | ||||||||||||
| Other borrowings | 71,425 | 849 | 2.40 | 71,149 | 1,304 | 3.69 | ||||||||||||
| Total Interest-Bearing Liabilities | 4,884,289 | 4,681 | 0.19 | 4,548,189 | 15,765 | 0.70 | ||||||||||||
| Noninterest demand | 2,616,856 | 1,861,126 | ||||||||||||||||
| Other liabilities | 102,450 | 71,413 | ||||||||||||||||
| Total Liabilities | 7,603,595 | 6,480,728 | ||||||||||||||||
| Shareholders' equity | 1,153,499 | 1,003,544 | ||||||||||||||||
| Total Liabilities & Equity | $ | 8,757,093 | $ | 7,484,272 | ||||||||||||||
| Cost of deposits | 0.10 | % | 0.43 | % | ||||||||||||||
| Interest expense as a % of earning assets | 0.12 | % | 0.46 | % | ||||||||||||||
| Net interest income as a % of earning assets | $ | 132,674 | 3.37 | % | $ | 130,679 | 3.81 | % | ||||||||||
| 1On a fully taxable equivalent basis. All yields and rates have been computed using amortized cost. | ||||||||||||||||||
| Fees on loans have been included in interest on loans. Nonaccrual loans are included in loan balances. | ||||||||||||||||||
| CONSOLIDATED QUARTERLY FINANCIAL DATA | (Unaudited) | |||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | ||||||||
| SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES | ||||||||||||||||||
| June 30, | March 31, | December 31, | September 30, | June 30, | ||||||||||||||
| (Amounts in thousands) | 2021 | 2021 | 2020 | 2020 | 2020 | |||||||||||||
| Customer Relationship Funding | ||||||||||||||||||
| Noninterest demand | ||||||||||||||||||
| Commercial | $ | 2,431,928 | $ | 2,189,564 | $ | 1,821,361 | $ | 1,973,494 | $ | 1,844,288 | ||||||||
| Retail | 401,988 | 379,257 | 350,783 | 322,559 | 314,723 | |||||||||||||
| Public funds | 88,057 | 83,315 | 90,973 | 70,371 | 74,674 | |||||||||||||
| Other | 30,187 | 33,111 | 26,670 | 34,320 | 33,750 | |||||||||||||
| Total Noninterest Demand | 2,952,160 | 2,685,247 | 2,289,787 | 2,400,744 | 2,267,435 | |||||||||||||
| Interest-bearing demand | ||||||||||||||||||
| Commercial | 545,797 | 497,047 | 454,909 | 413,513 | 412,846 | |||||||||||||
| Retail | 958,619 | 895,853 | 839,958 | 777,078 | 733,772 | |||||||||||||
| Public funds | 259,468 | 255,035 | 271,202 | 194,854 | 221,528 | |||||||||||||
| Total Interest-Bearing Demand | 1,763,884 | 1,647,935 | 1,566,069 | 1,385,445 | 1,368,146 | |||||||||||||
| Total transaction accounts | ||||||||||||||||||
| Commercial | 2,977,725 | 2,686,611 | 2,276,270 | 2,387,007 | 2,257,134 | |||||||||||||
| Retail | 1,360,607 | 1,275,110 | 1,190,741 | 1,099,637 | 1,048,495 | |||||||||||||
| Public funds | 347,525 | 338,350 | 362,175 | 265,225 | 296,202 | |||||||||||||
| Other | 30,187 | 33,111 | 26,670 | 34,320 | 33,750 | |||||||||||||
| Total Transaction Accounts | 4,716,044 | 4,333,182 | 3,855,856 | 3,786,189 | 3,635,581 | |||||||||||||
| Savings | 811,516 | 768,362 | 689,179 | 655,072 | 619,251 | |||||||||||||
| Money market | ||||||||||||||||||
| Commercial | 787,894 | 692,537 | 611,623 | 634,697 | 586,416 | |||||||||||||
| Retail | 737,554 | 701,453 | 661,311 | 613,532 | 579,126 | |||||||||||||
| Brokered | 187,023 | 197,389 | 196,616 | 141,808 | — | |||||||||||||
| Public funds | 94,719 | 79,800 | 86,820 | 67,041 | 67,350 | |||||||||||||
| Total Money Market | 1,807,190 | 1,671,179 | 1,556,370 | 1,457,078 | 1,232,892 | |||||||||||||
| Brokered time certificates | 20,000 | 93,500 | 233,815 | 381,028 | 572,465 | |||||||||||||
| Other time certificates | 481,686 | 519,526 | 597,341 | 635,476 | 606,594 | |||||||||||||
| 501,686 | 613,026 | 831,156 | 1,016,504 | 1,179,059 | ||||||||||||||
| Total Deposits | $ | 7,836,436 | $ | 7,385,749 | $ | 6,932,561 | $ | 6,914,843 | $ | 6,666,783 | ||||||||
| Customer sweep accounts | $ | 119,973 | $ | 109,171 | $ | 119,609 | $ | 89,508 | $ | 92,125 |
Explanation of Certain Unaudited Non-GAAP Financial Measures
This presentation contains financial information determined by methods other than Generally Accepted Accounting Principles (“GAAP”). Management uses these non-GAAP financial measures in its analysis of the Company’s performance and believes these presentations provide useful supplemental information, and a clearer understanding of the Company’s performance. The Company believes the non-GAAP measures enhance investors’ understanding of the Company’s business and performance and if not provided would be requested by the investor community. These measures are also useful in understanding performance trends and facilitate comparisons with the performance of other financial institutions. The limitations associated with operating measures are the risk that persons might disagree as to the appropriateness of items comprising these measures and that different companies might define or calculate these measures differently. The Company provides reconciliations between GAAP and these non-GAAP measures. These disclosures should not be considered an alternative to GAAP.
| GAAP TO NON-GAAP RECONCILIATION | (Unaudited) | ||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES | |||||||||||||||||||||
| Quarterly Trends | Six Months Ended | ||||||||||||||||||||
| (Amounts in thousands, except per share data) | 2Q'21 | 1Q'21 | 4Q'20 | 3Q'20 | 2Q'20 | 2Q'21 | 2Q'20 | ||||||||||||||
| Net Income | $ | 31,410 | $ | 33,719 | $ | 29,347 | $ | 22,628 | $ | 25,080 | $ | 65,129 | $ | 25,789 | |||||||
| Total noninterest income | 15,322 | 17,671 | 14,930 | 16,946 | 15,006 | 32,993 | 29,694 | ||||||||||||||
| Securities losses (gains), net | 55 | 114 | 18 | (4) | (1,230) | 169 | (1,249) | ||||||||||||||
| Total Adjustments to Noninterest Income | 55 | 114 | 18 | (4) | (1,230) | 169 | (1,249) | ||||||||||||||
| Total Adjusted Noninterest Income | 15,377 | 17,785 | 14,948 | 16,942 | 13,776 | 33,162 | 28,445 | ||||||||||||||
| Total noninterest expense | 45,784 | 46,120 | 43,681 | 51,674 | 42,399 | 91,904 | 90,197 | ||||||||||||||
| Merger related charges | (509) | (581) | — | (4,281) | (240) | (1,090) | (4,793) | ||||||||||||||
| Amortization of intangibles | (1,212) | (1,211) | (1,421) | (1,497) | (1,483) | (2,423) | (2,939) | ||||||||||||||
| Business continuity expenses | — | — | — | — | — | — | (307) | ||||||||||||||
| Branch reductions and other expense initiatives | (663) | (449) | (354) | (464) | — | (1,112) | — | ||||||||||||||
| Total Adjustments to Noninterest Expense | (2,384) | (2,241) | (1,775) | (6,242) | (1,723) | (4,625) | (8,039) | ||||||||||||||
| Total Adjusted Noninterest Expense | 43,400 | 43,879 | 41,906 | 45,432 | 40,676 | 87,279 | 82,158 | ||||||||||||||
| Income Taxes | 8,785 | 10,157 | 8,793 | 6,992 | 7,188 | 18,942 | 7,033 | ||||||||||||||
| Tax effect of adjustments | 598 | 577 | 440 | 1,530 | 121 | 1,175 | 1,665 | ||||||||||||||
| Total Adjustments to Income Taxes | 598 | 577 | 440 | 1,530 | 121 | 1,175 | 1,665 | ||||||||||||||
| Adjusted Income Taxes | 9,383 | 10,734 | 9,233 | 8,522 | 7,309 | 20,117 | 8,698 | ||||||||||||||
| Adjusted Net Income | $ | 33,251 | $ | 35,497 | $ | 30,700 | $ | 27,336 | $ | 25,452 | $ | 68,748 | $ | 30,914 | |||||||
| Earnings per diluted share, as reported | $ | 0.56 | $ | 0.60 | $ | 0.53 | $ | 0.42 | $ | 0.47 | $ | 1.17 | $ | 0.49 | |||||||
| Adjusted Earnings per Diluted Share | 0.59 | 0.63 | 0.55 | 0.50 | 0.48 | 1.23 | 0.59 | ||||||||||||||
| Average diluted shares outstanding | 55,901 | 55,992 | 55,739 | 54,301 | 53,308 | 55,827 | 52,807 | ||||||||||||||
| Adjusted Noninterest Expense | $ | 43,400 | $ | 43,879 | $ | 41,906 | $ | 45,432 | $ | 40,676 | $ | 87,279 | $ | 82,158 | |||||||
| Provision for credit losses on unfunded commitments | — | — | 795 | (756) | (178) | — | (224) | ||||||||||||||
| Foreclosed property expense and net gain / (loss) on sale | 90 | 65 | (1,821) | (512) | (245) | 155 | 70 | ||||||||||||||
| Net Adjusted Noninterest Expense | $ | 43,490 | $ | 43,944 | $ | 40,880 | $ | 44,164 | $ | 40,253 | $ | 87,434 | $ | 82,004 | |||||||
| Revenue | $ | 81,124 | $ | 84,281 | $ | 83,721 | $ | 80,449 | $ | 82,278 | $ | 165,405 | $ | 160,143 | |||||||
| Total Adjustments to Revenue | 55 | 114 | 18 | (4) | (1,230) | 169 | (1,249) | ||||||||||||||
| Impact of FTE adjustment | 131 | 131 | 112 | 118 | 116 | 262 | 230 | ||||||||||||||
| Adjusted Revenue on a fully taxable equivalent basis | $ | 81,310 | $ | 84,526 | $ | 83,851 | $ | 80,563 | $ | 81,164 | $ | 165,836 | $ | 159,124 | |||||||
| Adjusted Efficiency Ratio | 53.49 | % | 51.99 | % | 48.75 | % | 54.82 | % | 49.60 | % | 52.72 | % | 51.53 | % | |||||||
| Net Interest Income | $ | 65,802 | $ | 66,610 | $ | 68,791 | $ | 63,503 | $ | 67,272 | $ | 132,412 | $ | 130,449 | |||||||
| Impact of FTE adjustment | 131 | 131 | 112 | 118 | 116 | 262 | 230 | ||||||||||||||
| Net Interest Income including FTE adjustment | $ | 65,933 | $ | 66,741 | $ | 68,903 | $ | 63,621 | $ | 67,388 | $ | 132,674 | $ | 130,679 | |||||||
| Total noninterest income | 15,322 | 17,671 | 14,930 | 16,946 | 15,006 | 32,993 | 29,694 | ||||||||||||||
| Total noninterest expense | 45,784 | 46,120 | 43,681 | 51,674 | 42,399 | 91,904 | 90,197 | ||||||||||||||
| Pre-Tax Pre-Provision Earnings | $ | 35,471 | $ | 38,292 | $ | 40,152 | $ | 28,893 | $ | 39,995 | $ | 73,763 | $ | 70,176 | |||||||
| Total Adjustments to Noninterest Income | 55 | 114 | 18 | (4) | (1,230) | 169 | (1,249) | ||||||||||||||
| Total Adjustments to Noninterest Expense | (2,294) | (2,176) | (2,801) | (7,510) | (2,146) | (4,470) | (8,193) | ||||||||||||||
| Adjusted Pre-Tax Pre-Provision Earnings | $ | 37,820 | $ | 40,582 | $ | 42,971 | $ | 36,399 | $ | 40,911 | $ | 78,402 | $ | 77,120 | |||||||
| Average Assets | $ | 9,025,846 | $ | 8,485,354 | $ | 8,376,396 | $ | 8,086,890 | $ | 7,913,002 | $ | 8,757,093 | $ | 7,484,272 | |||||||
| Less average goodwill and intangible assets | (235,964) | (237,323) | (238,631) | (228,801) | (230,871) | (236,640) | (228,791) | ||||||||||||||
| Average Tangible Assets | $ | 8,789,882 | $ | 8,248,031 | $ | 8,137,765 | $ | 7,858,089 | $ | 7,682,131 | $ | 8,520,453 | $ | 7,255,481 | |||||||
| Return on Average Assets (ROA) | 1.40 | % | 1.61 | % | 1.39 | % | 1.11 | % | 1.27 | % | 1.50 | % | 0.69 | % | |||||||
| Impact of removing average intangible assets and related amortization | 0.08 | 0.09 | 0.10 | 0.09 | 0.10 | 0.08 | 0.09 | ||||||||||||||
| Return on Average Tangible Assets (ROTA) | 1.48 | 1.70 | 1.49 | 1.20 | 1.37 | 1.58 | 0.78 | ||||||||||||||
| Impact of other adjustments for Adjusted Net Income | 0.04 | 0.05 | 0.01 | 0.18 | (0.04) | 0.05 | 0.08 | ||||||||||||||
| Adjusted Return on Average Tangible Assets | 1.52 | 1.75 | 1.50 | 1.38 | 1.33 | 1.63 | 0.86 | ||||||||||||||
| GAAP TO NON-GAAP RECONCILIATION | (Unaudited) | ||||||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | |||
| SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES | |||||||||||||||||||||
| Quarterly Trends | Six Months Ended | ||||||||||||||||||||
| (Amounts in thousands, except per share data) | 2Q'21 | 1Q'21 | 4Q'20 | 3Q'20 | 2Q'20 | 2Q'21 | 2Q'20 | ||||||||||||||
| Average Shareholders' Equity | $ | 1,170,395 | $ | 1,136,416 | $ | 1,111,073 | $ | 1,061,807 | $ | 1,013,095 | $ | 1,153,499 | $ | 1,003,544 | |||||||
| Less average goodwill and intangible assets | (235,964) | (237,323) | (238,631) | (228,801) | (230,871) | (236,640) | (228,791) | ||||||||||||||
| Average Tangible Equity | $ | 934,431 | $ | 899,093 | $ | 872,442 | $ | 833,006 | $ | 782,224 | $ | 916,859 | $ | 774,753 | |||||||
| Return on Average Shareholders' Equity | 10.76 | % | 12.03 | % | 10.51 | % | 8.48 | % | 9.96 | % | 11.39 | % | 5.17 | % | |||||||
| Impact of removing average intangible assets and related amortization | 3.12 | 3.59 | 3.36 | 2.87 | 3.51 | 3.34 | 2.10 | ||||||||||||||
| Return on Average Tangible Common Equity (ROTCE) | 13.88 | 15.62 | 13.87 | 11.35 | 13.47 | 14.73 | 7.27 | ||||||||||||||
| Impact of other adjustments for Adjusted Net Income | 0.39 | 0.39 | 0.13 | 1.71 | (0.38) | 0.39 | 0.75 | ||||||||||||||
| Adjusted Return on Average Tangible Common Equity | 14.27 | 16.01 | 14.00 | 13.06 | 13.09 | 15.12 | 8.02 | ||||||||||||||
| Loan interest income1 | $ | 60,440 | $ | 62,390 | $ | 65,684 | $ | 60,573 | $ | 64,929 | $ | 122,830 | $ | 128,453 | |||||||
| Accretion on acquired loans | (2,886) | (2,868) | (4,448) | (3,254) | (2,988) | (5,754) | (7,275) | ||||||||||||||
| Interest and fees on PPP loans | (5,127) | (6,886) | (5,187) | (1,719) | (5,068) | (12,013) | (5,068) | ||||||||||||||
| Loan interest income excluding PPP and accretion on acquired loans | $ | 52,427 | $ | 52,636 | $ | 56,049 | $ | 55,600 | $ | 56,873 | $ | 105,063 | $ | 116,110 | |||||||
| Yield on loans1 | 4.33 | 4.39 | 4.42 | 4.11 | 4.56 | 4.36 | 4.72 | ||||||||||||||
| Impact of accretion on acquired loans | (0.21) | (0.20) | (0.30) | (0.22) | (0.21) | (0.20) | (0.27) | ||||||||||||||
| Impact of PPP loans | 0.01 | (0.04) | 0.11 | 0.33 | (0.04) | (0.02) | (0.01) | ||||||||||||||
| Yield on loans excluding PPP and accretion on acquired loans | 4.13 | % | 4.15 | % | 4.23 | % | 4.22 | % | 4.31 | % | 4.14 | % | 4.44 | % | |||||||
| Net Interest Income1 | $ | 65,933 | $ | 66,741 | $ | 68,903 | $ | 63,621 | $ | 67,388 | $ | 132,674 | $ | 130,679 | |||||||
| Accretion on acquired loans | (2,886) | (2,868) | (4,448) | (3,254) | (2,988) | (5,754) | (7,275) | ||||||||||||||
| Interest and fees on PPP loans | (5,127) | (6,886) | (5,187) | (1,719) | (5,068) | (12,013) | (5,068) | ||||||||||||||
| Net interest income excluding PPP and accretion on acquired loans | $ | 57,920 | $ | 56,987 | $ | 59,268 | $ | 58,648 | $ | 59,332 | $ | 114,907 | $ | 118,336 | |||||||
| Net Interest Margin | 3.23 | 3.51 | 3.59 | 3.40 | 3.70 | 3.37 | 3.81 | ||||||||||||||
| Impact of accretion on acquired loans | (0.14) | (0.15) | (0.23) | (0.17) | (0.16) | (0.15) | (0.25) | ||||||||||||||
| Impact of PPP loans | (0.06) | (0.11) | 0.01 | 0.19 | (0.08) | (0.08) | — | ||||||||||||||
| Net interest margin excluding PPP and accretion on acquired loans | 3.03 | % | 3.25 | % | 3.37 | % | 3.42 | % | 3.46 | % | 3.14 | % | 3.56 | % | |||||||
| Security interest income1 | $ | 6,745 | $ | 6,485 | $ | 6,586 | $ | 7,129 | $ | 7,725 | $ | 13,230 | $ | 16,573 | |||||||
| Tax equivalent adjustment on securities | (39) | (39) | (23) | (32) | (31) | (78) | (61) | ||||||||||||||
| Security interest income excluding tax equivalent adjustment | $ | 6,706 | $ | 6,446 | $ | 6,563 | $ | 7,097 | $ | 7,694 | $ | 13,152 | $ | 16,512 | |||||||
| Loan interest income1 | $ | 60,440 | $ | 62,390 | $ | 65,684 | $ | 60,573 | $ | 64,929 | $ | 122,830 | $ | 128,453 | |||||||
| Tax equivalent adjustment on loans | (92) | (92) | (89) | (86) | (85) | (184) | (169) | ||||||||||||||
| Loan interest income excluding tax equivalent adjustment | $ | 60,348 | $ | 62,298 | $ | 65,595 | $ | 60,487 | $ | 64,844 | $ | 122,646 | $ | 128,284 | |||||||
| Net Interest Income1 | $ | 65,933 | $ | 66,741 | $ | 68,903 | $ | 63,621 | $ | 67,388 | $ | 132,674 | $ | 130,679 | |||||||
| Tax equivalent adjustment on securities | (39) | (39) | (23) | (32) | (31) | (78) | (61) | ||||||||||||||
| Tax equivalent adjustment on loans | (92) | (92) | (89) | (86) | (85) | (184) | (169) | ||||||||||||||
| Net interest income excluding tax equivalent adjustment | $ | 65,802 | $ | 66,610 | $ | 68,791 | $ | 63,503 | $ | 67,272 | $ | 132,412 | $ | 130,449 | |||||||
| 1On a fully taxable equivalent basis. All yields and rates have been computed using amortized cost. |
sbcf2q2021earningspresen
Earnings Presentation SECOND QUARTER 2021 RESULTS Contact: (email) Tracey.Dexter@SeacoastBank.com (phone) 772.403.0461 (web) www.SeacoastBanking.com
2 SECOND QUARTER 2021 EARNINGS PRESENTATION Cautionary Notice Regarding Forward-Looking Statements This press release contains “forward-looking statements” within the meaning, and protections, of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including, without limitation, statements about future financial and operating results, cost savings, enhanced revenues, economic and seasonal conditions in the Company’s markets, and improvements to reported earnings that may be realized from cost controls, tax law changes, new initiatives and for integration of banks that the Company has acquired, or expects to acquire, including Legacy Bank of Florida, as well as statements with respect to Seacoast's objectives, strategic plans, expectations and intentions and other statements that are not historical facts, any of which may be impacted by the COVID-19 pandemic and related effects on the U.S. economy. Actual results may differ from those set forth in the forward-looking statements. Forward-looking statements include statements with respect to the Company’s beliefs, plans, objectives, goals, expectations, anticipations, assumptions, estimates and intentions about future performance, and involve known and unknown risks, uncertainties and other factors, which may be beyond the Company’s control, and which may cause the actual results, performance or achievements of Seacoast to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. You should not expect the Company to update any forward-looking statements. All statements other than statements of historical fact could be forward-looking statements. You can identify these forward- looking statements through the use of words such as “may”, “will”, “anticipate”, “assume”, “should”, “support”, “indicate”, “would”, “believe”, “contemplate”, “expect”, “estimate”, “continue”, “further”, “plan”, “point to”, “project”, “could”, “intend”, “target” or other similar words and expressions of the future. These forward-looking statements may not be realized due to a variety of factors, including, without limitation: the effects of future economic and market conditions, including seasonality and the adverse effects of COVID-19 (economic and otherwise); government or regulatory responses to the COVID-19 pandemic; governmental monetary and fiscal policies, including interest rate policies of the Board of Governors of the Federal Reserve, as well as legislative, tax and regulatory changes including those that impact the money supply and inflation; changes in accounting policies, rules and practices, including the impact of the adoption of the current expected credit losses (“CECL”) methodology; participation in the Paycheck Protection Program (“PPP”); the risks of changes in interest rates on the level and composition of deposits, loan demand, liquidity and the values of loan collateral, securities, and interest rate sensitive assets and liabilities; interest rate risks, sensitivities and the shape of the yield curve; uncertainty related to the impact of LIBOR calculations on securities, loans and debt; changes in borrower credit risks and payment behaviors; changes in retail distribution strategies, customer preferences and behavior; changes in the availability and cost of credit and capital in the financial markets; changes in the prices, values and sales volumes of residential and commercial real estate; our ability to comply with any regulatory requirements; the effects of problems encountered by other financial institutions; changes in the prices, values and sales volumes for residential and commercial real estate; our ability to comply with any regulatory requirements; the effects of problems encountered by other financial institutions that adversely affect Seacoast or the banking industry; the Company's concentration in commercial real estate loans and in real estate collateral in Florida; inaccuracies or other failures from the use of models, including the failure of assumptions and estimates, as well as differences in, and changes to, economic, market and credit conditions; the impact on the valuation of Seacoast’s investments due to market volatility or counterparty payment risk; statutory and regulatory dividend restrictions; increases in regulatory capital requirements for banking organizations generally; the risks of mergers, acquisitions and divestitures, including Seacoast’s ability to continue to identify acquisition targets and successfully acquire and integrate desirable financial institutions; changes in technology or products that may be more difficult, costly, or less effective than anticipated; the Company's ability to identify and address increased cybersecurity risks, including as a result of employees working remotely; inability of Seacoast’s risk management framework to manage risks associated with the Company's business; dependence on key suppliers or vendors to obtain equipment or services for the business on acceptable terms; reduction in or the termination of Seacoast’s ability to use the mobile-based platform that is critical to the Company's business growth strategy; the effects of war or other conflicts, acts of terrorism, natural disasters, health emergencies, epidemics or pandemics, or other catastrophic events that may affect general economic conditions; unexpected outcomes of and the costs associated with, existing or new litigation involving the Company, including as a result of the Company’s participation in the PPP; Seacoast’s ability to maintain adequate internal controls over financial reporting; potential claims, damages, penalties, fines and reputational damage resulting from pending or future litigation, regulatory proceedings and enforcement actions; the risks that deferred tax assets could be reduced if estimates of future taxable income from the Company's operations and tax planning strategies are less than currently estimated and sales of capital stock could trigger a reduction in the amount of net operating loss carryforwards that the Company may be able to utilize for income tax purposes; the effects of competition from other commercial banks, thrifts, mortgage banking firms, consumer finance companies, credit unions, non-bank financial technology providers, securities brokerage firms, insurance companies, money market and other mutual funds and other financial institutions operating in the Company's market areas and elsewhere, including institutions operating regionally, nationally and internationally, together with such competitors offering banking products and services by mail, telephone, computer and the Internet; the failure of assumptions underlying the establishment of reserves for possible loan losses. The risks relating to the Legacy Bank of Florida proposed merger include, without limitation: the timing to consummate the proposed merger; the risk that a condition to closing of the proposed merger may not be satisfied; the risk that the merger is not completed at all; the diversion of management time on issues related to the proposed merger; unexpected transaction costs, including the costs of integrating operations; the risks that the businesses will not be integrated successfully or such integration may be more difficult, time-consuming or costly than expected; the potential failure to fully or timely realize expected revenues and revenue synergies, including as the result of revenues following the merger being lower than expected; the risk of deposit and customer attrition; any changes in deposit mix; unexpected operating and other costs, which may differ or change from expectation; the risk of customer and employee loss and business disruptions, including, without limitation, as the result of difficulties in maintaining relationships with employees; increased competitive pressures on solicitations of customers by competitors; as well as difficulties and risks inherent with entering new markets. Actual results and capital and other financial conditions may differ materially from those included in these statements due to a variety of factors. These factors include, among others described above, macroeconomic and other challenges and uncertainties related to the COVID-19 pandemic, such as the duration and severity of the impact on public health, the U.S. and global economies, financial markets and consumer and corporate customers and clients, including economic activity and employment, as well as the various actions taken in response by governments, central banks and others, including Seacoast, and the precautionary statements included in this release. All written or oral forward-looking statements attributable to us are expressly qualified in their entirety by this cautionary notice, including, without limitation, those risks and uncertainties described in the Company’s annual report on Form 10-K for the year ended December 31, 2020 and quarterly report on Form 10-Q for the quarter ended March 31, 2021 under “Special Cautionary Notice Regarding Forward-Looking Statements” and “Risk Factors”, and otherwise in the Company’s SEC reports and filings. Such reports are available upon request from the Company, or from the Securities and Exchange Commission, including through the SEC’s Internet website at www.sec.gov.
3 SECOND QUARTER 2021 EARNINGS PRESENTATION • Highly disciplined credit portfolio • Strong liquidity position • Prudent capital position to support further organic growth and opportunistic acquisition • Steady increase in shareholder value with tangible book value per share increasing 13% year-over- year • Active board with a diverse range of experience and expertise Valuable Florida Franchise, Well Positioned for Growth with Strong Capital, Liquidity and Disciplined Credit Culture Valuable Florida Franchise with Disciplined Growth Strategy, Benefiting from Fortress Balance Sheet with Robust Capital Generation, Prudent Liquidity Position, and Strict Credit Underwriting • $9.3 billion in assets as of June 30, 2021, operating in the nation’s third-most populous state • Strong and growing presence in four of Florida’s most attractive MSAs ▪ #1 Florida-based bank in Orlando ▪ #1 market share in Port St Lucie MSA ▪ #2 Florida-based bank in West Palm Beach/Fort Lauderdale ▪ #2 Florida-based community bank in Tampa, and #1 in St. Petersburg • Market Cap: $1.9 billion as of June 30, 2021 Seacoast Customer Map
4 SECOND QUARTER 2021 EARNINGS PRESENTATION Florida’s Economic Growth Continues to Accelerate • Companies and individuals seeking real estate affordability, lower taxes, warmer weather, and easy flights back to the Northeast are migrating to Florida. • Florida's population grew 14.6% between 2010 and 2020. Double the rate of overall U.S. population growth. Source: US Census data • In March 2021, short-term population projections were increased reflecting stronger domestic net-migration trends supported by a shift in lifestyle preference away from more dense urban areas. Source: Office of Economic & Demographic Research – Florida’s population will surpass 23 million by late 2024 or 2025 (21.6 million at year-end 2020). – This increase is equivalent to adding a city larger than Orlando every year • Financial institutions and other major corporations have announced plans to relocate some or all of their operations to Florida in the near future:
5 SECOND QUARTER 2021 EARNINGS PRESENTATION Second Quarter 2021 Highlights All comparisons are to second quarter 2020 unless otherwise stated. • Net income of $31.4 million, an increase of 25%. Adjusted net income1 of $33.3 million, an increase of 31%. • Earnings per share increased to $0.56 compared to $0.47. Adjusted earnings per share1 increased to $0.59 from $0.48. • On a GAAP basis, achieved 1.48% return on tangible assets (ROTA) and 13.88% return on tangible common equity (“ROTCE”). On an adjusted basis, second quarter results were 1.52% adjusted ROTA1 and 14.27% adjusted ROTCE1. • Steadily building shareholder value through consistent growth in tangible book value per share, ending the period at $17.08, an increase of 13% over the prior year. • Sequential increase in the commercial pipeline each quarter of 2021, in line with an expanding Florida economy. • Total loan pipelines increased by 83%, in line with a strong Florida economic recovery. • Continued strong asset quality trends, with charge-offs of only $0.7 million and nonperforming loans declining to 0.61% of total loans. • Cost of deposits decreased by five basis points from the prior quarter to eight basis points. • Record wealth management revenue for the quarter and $451 million in AUM growth from June 30, 2020, bringing total AUM to $1.2 billion. • Record interchange income of $4.1 million, reflecting higher transactional volume and higher per-card spending, both indicative of the strength and confidence of our consumer and small business franchise. 1Non-GAAP measure, see “Explanation of Certain Unaudited Non-GAAP Financial Measures" for more information and a reconciliation to GAAP.
6 SECOND QUARTER 2021 EARNINGS PRESENTATION Net Interest Income and Margin • Net interest income1 totaled $65.9 million, a decrease of $0.8 million, or 1%, from the prior quarter and a decrease of $1.5 million, or 2%, from the second quarter of 2020. This included interest and fees earned on Paycheck Protection Program (“PPP”) loans of $5.1 million compared to $6.9 million in the prior quarter and $5.1 million in the prior year quarter. • Net interest margin1 declined from 3.51% in the first quarter of 2021 to 3.23% in the second quarter of 2021, largely as the result of significant growth in transaction account deposit balances during the second quarter. This increase in funding occurred across our customer base at near-zero rates, as new clients were onboarded and existing clients continue to see expansion in cash balances. The resulting increase in liquidity negatively impacted net interest margin by 23 basis points. Excluding this increase in liquidity, the remaining decline in net interest margin is attributed to lower PPP interest and fees as a result of declining balances as PPP loans are forgiven. Excess liquidity has been partially invested through securities purchases; however, cash deployment remains disciplined and prudent, with careful reinvestment of liquidity over time. Securities yields declined by only two basis points to 1.63% in the second quarter of 2021. Non-PPP loan yields declined by only one basis point to 4.36% during the second quarter of 2021. Offsetting and favorable was the decline in the cost of deposits from 13 basis points in the first quarter of 2021 to eight basis points in the second quarter of 2021. The effect on net interest margin of accretion of purchase discounts on acquired loans was an increase of 14 basis points in the second quarter compared to an increase of 15 basis points in the prior quarter. The effect on net interest margin of interest and fees on PPP loans was an increase of six basis points in the second quarter and an increase of 11 basis points in the prior quarter. ($ in th ou sa nd s) $67,388 $63,621 $68,903 $66,741 $65,933 3.70% 3.40% 3.59% 3.51% 3.23% 3.46% 3.42% 3.37% 3.25% 3.03% Net Interest Income Net Interest Margin NIM, excluding PPP and accretion on acquired loans 2Q'20 3Q'20 4Q'20 1Q'21 2Q'21 1Calculated on a fully taxable equivalent basis using amortized cost.
7 SECOND QUARTER 2021 EARNINGS PRESENTATION Noninterest income decreased $2.3 million from the prior quarter to $15.3 million, and adjusted noninterest income1 decreased $2.4 million to $15.4 million sequentially. Changes include: • Interchange revenue reached a new record of $4.1 million, compared to $3.8 million in the prior quarter, reflecting higher transactional volume and higher per- card spending, both indicative of strength and confidence in our consumer and small business franchise. • Wealth management income increased to a record $2.4 million in the current quarter, compared to $2.3 million in the first quarter of 2021. The team continues to deliver strong growth in assets under management, which increased $133 million quarter-over-quarter, bringing total assets under management to $1.2 billion. The team continues to successfully win business with commercial relationships and high net worth families across the footprint. • Mortgage banking fees were $3.0 million, compared to $4.2 million in the prior quarter, due to slowing refinance activity and low housing inventory levels. • Other income declined by $1.5 million in the second quarter of 2021, reflecting the impact in the first quarter of 2021 of $1.7 million in income associated with the resolution of contingencies on two loans acquired in 2017. Continued Strength in Noninterest Income $13,776 $17,785 $15,377 $1,939 $2,338 $2,338 $3,187 $3,820 $4,145 $1,719 $2,323 $2,386 $3,559 $4,225 $2,977$181 $287 $232$2,304 $3,933 $2,427$887 $859 $872 BOLI Other Income SBA Gains Mortgage Banking Wealth Management Interchange Income Service Charges 2Q'20 1Q'21 2Q'21 1Non-GAAP measure, see “Explanation of Certain Unaudited Non-GAAP Financial Measures" for more information and a reconciliation to GAAP. 2Other Income includes marine finance fees, swap related income and other fees related to customer activity as well as securities gains of $1.2 million in 2Q'20, losses of $0.1 million in 1Q'21 and losses of $0.1 million in 2Q'21. 3Other Income on an adjusted basis includes marine finance fees, swap related income and other fees related to customer activity. $15,006 $17,671 $15,322 $1,939 $2,338 $2,338 $3,187 $3,820 $4,145 $1,719 $2,323 $2,387 $3,559 $4,225 $2,977$181 $287 $232$3,534 $3,819 $2,371 $887 $859 $872 BOLI Other Income SBA Gains Mortgage Banking Wealth Management Interchange Income Service Charges 2Q'20 1Q'21 2Q'21 Adjusted Noninterest Income1 ($ in thousands) 2 3 Noninterest Income ($ in thousands)
8 SECOND QUARTER 2021 EARNINGS PRESENTATION Continued Focus on Disciplined Expense Control Noninterest expense decreased $0.3 million and adjusted noninterest expense1 decreased $0.5 million sequentially. Changes quarter-over-quarter on an adjusted basis include: • Within salaries and benefits expense, results in the second quarter of 2021 include lower employee benefits costs due to seasonally high first quarter expenses, offset by lower deferral of PPP loan origination costs associated with the SBA’s closure of the program in the second quarter. The quarter-over-quarter impact of the lower cost deferral as a result of the closure of the PPP program was $1.9 million. • Legal and professional fees were lower by $0.3 million compared to the first quarter. • Occupancy and telephone expense decreased by $0.3 million compared to the first quarter, reflecting the benefit of three branch consolidations completed in the first quarter. $40,676 $43,879 $43,400 $23,525 $26,303 $26,364 $4,067 $4,468 $4,694 $5,522 $5,468 $5,217$2,044 $1,997 $1,677 $5,518 $5,643 $5,448 Other Expense Legal & Professional Occupancy & Telephone Data Processing Cost Salaries & Benefits 2Q'20 1Q'21 2Q'21 1Non-GAAP measure, see “Explanation of Certain Unaudited Non-GAAP Financial Measures" for more information and a reconciliation to GAAP. 2Other Expense includes marketing expenses, provision for credit losses on unfunded commitments, foreclosed property expense and net loss/(gain) on sale and other expenses associated with ongoing business operations. $42,399 $46,120 $45,784 $23,605 $26,373 $26,919 $1,483 $1,211 $1,212$4,059 $4,468 $4,676 $5,534 $5,828 $5,314$2,277 $2,582 $2,182$5,441 $5,658 $5,481 Other Expense Legal & Professional Occupancy & Telephone Data Processing Cost Amortization of Intangibles Salaries & Benefits 2Q'20 1Q'21 2Q'21 2 Adjusted Noninterest Expense1 ($ in thousands) 2 Noninterest Expense ($ in thousands)
9 SECOND QUARTER 2021 EARNINGS PRESENTATION • The efficiency ratio was 54.9% for the second quarter of 2021 compared to 53.2% in the prior quarter and 50.1% in the second quarter of 2020. • The adjusted efficiency ratio1 was 53.5% for the second quarter of 2021 compared to 52.0% in the prior quarter and 49.6% in the second quarter of 2020. • The Company remains focused on proactive management of its cost structure. Palm Beach Community Bank and North Star Bank Acquisitions Pa lm B ea ch C om m un ity a nd N or th S ta r Ba nk A cq ui si tio n Efficiency Ratio Trend 58% 57% 66% 57% 53% 49% 48% 60% 50% 62% 48% 53% 55% 2Q '18 3Q '18 4Q '18 1Q '19 2Q '19 3Q '19 4Q '19 1Q '20 2Q '20 3Q '20 4Q '20 1Q '21 2Q '21 1Non-GAAP measure, see “Explanation of Certain Unaudited Non-GAAP Financial Measures" for more information and a reconciliation to GAAP. 57% 56% 54% 56% 51% 49% 48% 54% 50% 55% 49% 52% 53% 2Q '18 3Q '18 4Q '18 1Q '19 2Q '19 3Q '19 4Q '19 1Q '20 2Q '20 3Q '20 4Q '20 1Q '21 2Q '21 GAAP - Efficiency Adjusted - Efficiency1 First Bank of the Palm Beaches First Green Bank Freedom Bank
10 SECOND QUARTER 2021 EARNINGS PRESENTATION Disciplined Approach to Lending in an Expanding Florida Economy $5,772 $5,858 $5,735 $5,661 $5,437 $5,196 $5,219 $5,168 $5,079 $5,073 $576 $639 $567 $582 $364 4.56% 4.11% 4.42% 4.39% 4.33% 4.31% 4.22% 4.23% 4.15% 4.13% Yield Excluding PPP and Accretion on Acquired Loans Reported Yield PPP Loans Loans Excluding PPP 2Q'20 3Q'20 4Q'20 1Q'21 2Q'21 Total Loans Outstanding ($ in millions) • Loans outstanding, excluding PPP, declined only $6 million quarter-over-quarter, in line with our expectation of near-flat growth for the second quarter of 2021. • $243 million in PPP loan forgiveness was processed during the second quarter of 2021. • Exiting the second quarter of 2021, overall pipelines increased from the prior quarter, comprised of $322 million in commercial, $32 million in consumer, and $115 million in residential mortgages, compared to $241 million, $28 million, and $165 million, respectively, in the prior quarter. • The yield on non-PPP loans declined to 4.36% from 4.37% in the first quarter of 2021, and when further excluding accretion on acquired loans, declined to 4.13% from 4.15%. • The Company remains focused and committed to its strict credit underwriting standards.
11 SECOND QUARTER 2021 EARNINGS PRESENTATION Paycheck Protection Program Loans ($ in m ill io ns ) $576 $256 $(457) $375 December 31, 2020 Originations Forgiveness June 30, 2021 PPP Fee Revenue Summary ($ in thousands) Fees earned from SBA to date (net of related costs) to originate PPP loans $ 27,633 Fees recognized in 2020 (7,774) Fees recognized to date in 2021 (9,267) Fees remaining to be recognized in future periods $ 10,592 5,169 loans ($9.5) deferred fees 2,782 loans 3,781 loans 4,170 loans ($10.6) deferred fees PPP Loans Rollforward • As of June 30, 2021, $364.1 million in PPP loans remain, with $10.6 million in fees that will be recognized over the loans’ remaining contractual maturity, or earlier, as loans are forgiven.
12 SECOND QUARTER 2021 EARNINGS PRESENTATION Commercial Real Estate $1,412,439 26% Residential Real Estate $1,226,536 23% • Construction and land development and commercial real estate loans, as defined in regulatory guidance, represent 22% and 150%, respectively, of total consolidated risk based capital. • Portfolio diversification in terms of asset mix, industry, and loan type, has been a critical element of the Company's lending strategy. Exposure across industries and collateral types is broadly distributed. • Excluding PPP loans, Seacoast's average commercial loan size is $420 thousand. Seacoast's Lending Strategy has Produced and Sustains a Diverse Loan Portfolio At June 30, 2021 ($ in thousands) Owner Occupied Commercial Real Estate $1,127,640 20% Acquisition, Development & Construction $234,347 4% Paycheck Protection Program $364,112 7%Consumer $171,769 3% Commercial & Financial $900,206 17%
13 SECOND QUARTER 2021 EARNINGS PRESENTATION Unrealized Gain (Loss) in Securities as of June 30, 2021 (in thousands) Amortized Cost Unrealized Gains Unrealized Losses Fair Value Available for Sale Government backed $ 7,412 $ 439 $ (2) $ 7,849 Agency mortgage backed 987,402 14,224 (5,906) 995,720 Private label MBS and CMOs 73,469 1,938 (218) 75,189 CLO 209,835 22 (165) 209,692 Municipal 32,288 2,038 — 34,326 Total Available for Sale $ 1,310,406 $ 18,661 $ (6,291) $ 1,322,776 Held to Maturity Agency mortgage backed $ 493,467 $ 5,697 $ (9,875) $ 489,289 Total Held to Maturity $ 493,467 $ 5,697 $ (9,875) $ 489,289 Total Securities $ 1,803,873 $ 24,358 $ (16,166) $ 1,812,065 • Portfolio yield declined two basis points to 1.63% from 1.65% in the prior quarter. The decline is primarily attributed to lower yielding portfolio additions partially offset by lower amortization from slower prepayments. • Net unrealized gains increased from $0.3 million to $8.2 million, largely due to the flattening of the yield curve during the quarter. • Purchases during the quarter were primarily agency collateralized mortgage obligations with a weighted average duration of 3.1 years and average yield of 1.39%. ($ in m ill io ns ) $976 $1,051 $1,323 2.68% 1.65% 1.63% HTM Securities AFS Securities Yield 2Q'20 1Q'21 2Q'21 Investment Securities Performance and Composition
14 SECOND QUARTER 2021 EARNINGS PRESENTATION Strong Deposit Franchise Supported by Attractive Markets • Total deposits increased $450 million quarter- over-quarter and increased $1.2 billion, or 18%, compared to the second quarter of 2020. Second quarter balances include a decrease of $86 million in brokered deposits. • Overall cost of deposits decreased to eight basis points from 13 basis points in the prior quarter. • Transaction accounts increased 30% year-over- year, reflecting continued strong growth in core customer balances, and represent 60% of overall deposit funding. $6,667 $6,915 $6,933 $7,386 $7,836 $3,636 $3,786 $3,856 $4,333 $4,716 $1,852 $2,112 $2,246 $2,440 $2,618$1,179 $1,017 $831 $613 $502 Transaction Accounts Savings & Money Market Time Deposits 2Q'20 3Q'20 4Q'20 1Q'21 2Q'21 60% Deposits Outstanding ($ in millions)
15 SECOND QUARTER 2021 EARNINGS PRESENTATION Cost of Deposits Continues to Decline, While Deposits Per Branch Continues to Grow • Seacoast's continued focus on organic growth and relationship-based funding, in combination with its innovative analytics platform, supports a well- diversified, low-cost deposit portfolio. • Cost of deposits declined five basis points quarter-over- quarter, reflecting the significant value of the deposit franchise. • Seacoast continues to evolve its branch footprint by redirecting capacity to attractive growth markets. As of June 30, 2021, deposits per banking center were $163 million, compared to $133 million on June 30, 2020. ($ in m illions) Trended Cost of Deposits and Deposits per Branch $113 $118 $116 $118 $133 $136 $136 $154 $163 2.50% 2.00% 1.75% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.76% 0.73% 0.61% 0.57% 0.31% 0.24% 0.19% 0.13% 0.08% Cost of Deposits Fed Funds Average deposits per branch 2Q'19 3Q'19 4Q'19 1Q'20 2Q'20 3Q'20 4Q'20 1Q'21 2Q'21
16 SECOND QUARTER 2021 EARNINGS PRESENTATION A Continued Focus on Building Wealth Management $653 $870 $1,025 $1,158 4Q'19 4Q'20 1Q'21 2Q'21 Assets Under Management ($ in millions) • Assets under management increased to $1.2 billion at June 30, 2021, an increase of 13% from March 31, 2021, and 64% from June 30, 2020. This is a result of the wealth management team’s continuing success at winning business with commercial relationships and high net worth families across the footprint. • Wealth Management Income was $2.4 million in the second quarter of 2021, compared to $2.3 million in the prior quarter, and $1.7 million in the prior year quarter. • Since December 31, 2019, assets under management have increased at a compound annual growth rate (“CAGR”) of 40%. 40% CAG R
17 SECOND QUARTER 2021 EARNINGS PRESENTATION Allowance for Credit Losses and Purchase Discount ($ in thousands) Loans Outstanding Allowance for Credit Losses % of Category Purchase Discount % of Category Acquisition, Development & Construction $ 234,347 $ 4,053 1.73 % $ 179 0.08 % Owner Occupied Commercial Real Estate 1,127,640 8,676 0.77 4,969 0.44 Commercial Real Estate 1,412,439 34,807 2.46 13,534 0.96 Residential Real Estate 1,226,536 12,543 1.02 1,780 0.15 Commercial & Financial 900,206 18,016 2.00 3,761 0.42 Consumer 171,769 3,032 1.77 93 0.05 Total Excluding PPP $ 5,072,937 $ 81,127 1.60 % $ 24,316 0.48 % Paycheck Protection Program $ 364,112 $ — — % $ 100 0.03 % Total $ 5,437,049 $ 81,127 1.49 % $ 24,416 0.45 % The allowance for credit losses of $81.1 million as of June 30, 2021 reflects management’s estimate of lifetime expected credit losses. The remaining unrecognized discount on acquired loans of $24.4 million will be earned as an adjustment to yield over the life of the loans. Additionally, a reserve for potential credit losses on lending-related commitments of $2.2 million is reflected within Other Liabilities.
18 SECOND QUARTER 2021 EARNINGS PRESENTATION Continued Strong Asset Quality Trends Net Charge-Offs $1,751 $1,736 $3,127 $370 $6550.12% 0.12% 0.21% 0.03% 0.05% NCO NCO/Total Loans 2Q'20 3Q'20 4Q'20 1Q'21 2Q'21 Nonperforming Loans $30,051 $36,897 $36,110 $35,328 $32,920 0.52% 0.63% 0.63% 0.62% 0.61% NPL NPL/Total Loans 2Q'20 3Q'20 4Q'20 1Q'21 2Q'21 $91,250 $94,013 $92,733 $86,643 $81,127 1.76% 1.80% 1.79% 1.71% 1.60% 1.58% 1.60% 1.62% 1.53% 1.49% ACL ACL/Total Loans Excluding PPP ACL/Total Loans 2Q'20 3Q'20 4Q'20 1Q'21 2Q'21 9% 10% 9% 9% 7% 4% 8% 7% 7% 6% Classified Special Mention 2Q'20 3Q'20 4Q'20 1Q'21 2Q'21 Allowance for Credit Losses ($ in thousands) Criticized Loans as a % of Risk-Based Capital
19 SECOND QUARTER 2021 EARNINGS PRESENTATION Strong Capital Supporting a Fortress Balance Sheet $15.11 $15.57 $16.16 $16.62 $17.08 $19.45 $19.91 $20.46 $20.89 $21.33 Tangible Book Value Per Share Book Value Per Share 2Q'20 3Q'20 4Q'20 1Q'21 2Q'21 10.2% 10.7% 11.0% 10.7% 10.4% 2Q'20 3Q'20 4Q'20 1Q'21 2Q'21 17.6% 17.9% 18.5% 19.1% 19.2% 16.4% 16.8% 17.4% 18.1% 18.3% Total Risk Based Capital Tier 1 Ratio 2Q'20 3Q'20 4Q'20 1Q'21 2Q'21 13.5% 11.4% 13.9% 15.6% 13.9%13.1% 13.1% 14.0% 16.0% 14.3% GAAP - ROTCE Adjusted - ROTCE 2Q'20 3Q'20 4Q'20 1Q'21 2Q'21 1Non-GAAP measure, see “Explanation of Certain Unaudited Non-GAAP Financial Measures" for more information and a reconciliation to GAAP. 2FDICIA defines well capitalized as 10.0% for total risk based capital and 8.0% for Tier 1 ratio at a total Bank level. Tangible Book Value and Book Value Per Share Tangible Common Equity / Tangible Assets Total Risk Based and Tier 1 CapitalReturn on Tangible Common Equity 1 10.0%2 8.0%2
20 SECOND QUARTER 2021 EARNINGS PRESENTATION Steady Increase in Shareholder Value $10.41 $10.55 $10.95 $11.15 $11.39 $11.67 $12.01 $12.33 $12.98 $13.65 $14.30 $14.76 $14.42 $15.11 $15.57 $16.16 $16.62 $17.08 1Q'17 2Q'17 3Q'17 4Q'17 1Q'18 2Q'18 3Q'18 4Q'18 1Q'19 2Q'19 3Q'19 4Q'19 1Q'20 2Q'20 3Q'20 4Q'20 1Q'21 2Q'21 • Compounded annual growth rate of 12% in tangible book value per share since 2017. • The decline in tangible book value per share during the first quarter of 2020 was primarily attributed to the Day-1 impact of the adoption of CECL. • Initiated a quarterly cash dividend of $0.13 in the second quarter of 2021.
21 SECOND QUARTER 2021 EARNINGS PRESENTATION Contact Details: Seacoast Banking Corporation of Florida Tracey L. Dexter Executive Vice President Chief Financial Officer (772) 403-0461 INVESTOR RELATIONS NASDAQ: SBCF
22 SECOND QUARTER 2021 EARNINGS PRESENTATION Appendix
23 SECOND QUARTER 2021 EARNINGS PRESENTATION Quarterly Trend Six Months Ended (Amounts in thousands) 2Q'21 1Q'21 4Q'20 3Q'20 2Q'20 2Q'21 2Q'20 Commercial pipeline at period end $ 322,014 $ 240,871 $ 166,735 $ 256,191 $ 117,042 322,014 117,042 Commercial loan originations 193,028 204,253 277,389 88,245 106,857 397,281 290,187 Residential pipeline-saleable at period end 60,585 92,141 92,017 149,896 94,666 60,585 94,666 Residential loans-sold 120,099 138,337 161,628 162,468 122,459 258,436 185,324 Residential pipeline-portfolio at period end 54,132 72,448 25,083 33,374 13,199 54,132 13,199 Residential loans-retained1 79,715 46,620 54,464 25,404 23,539 126,335 49,315 Consumer pipeline at period end 31,748 28,127 18,207 17,094 30,647 31,748 30,647 Consumer originations 63,702 46,745 47,529 62,293 57,956 110,447 109,472 PPP originations 23,529 232,478 — 8,276 590,718 256,007 590,718 Total Pipelines at Period End $ 468,479 $ 433,587 $ 302,042 $ 456,555 $ 255,554 $ 468,479 $ 255,554 Total Originations $ 480,073 $ 668,433 $ 541,010 $ 346,686 $ 901,529 $ 1,148,506 $ 1,225,016 1Includes residential mortgages purchased of $38.4 million in 2Q'21 Loan Production and Pipeline Trend
24 SECOND QUARTER 2021 EARNINGS PRESENTATION Legacy Bank of Florida Acquisition Expected to Close August 6, 2021 High-Quality Expansion in Attractive Market • In-market acquisition of a high-quality franchise with a high-yielding loan portfolio in attractive Palm Beach and Broward counties • Leverages Seacoast’s proven integration capabilities Anticipated Positive Financial Results • 6% core EPS accretion in 2022 • Approximately 45% cost savings • Tangible book value dilution earn-back of 0.25 years Consideration • Shareholders will receive 0.1703 shares of Seacoast common stock • Options are rolled over into Seacoast options Closing • Expected in third quarter of 2021, subject to shareholder and regulatory approval and other customary conditions Additional Details and Assumptions (at date of announcement) • Legacy Bank of Florida shareholders to own approximately 4.6% of Seacoast following the transaction • Estimated core deposit intangibles of 0.75% amortized using straight-line method over 6 years • 3.71% / $16.1 million total pre-tax mark to Legacy Bank of Florida’s loan book; includes (0.50%) interest rate mark, 1.73% credit discount mark on non-PCD loans, and 2.49% CECL-related allowance
25 SECOND QUARTER 2021 EARNINGS PRESENTATION Seacoast’s Integrated Delivery Model Supports Our Growth Strategy 59% % of consumer deposits completed outside of the branch 10% % increase in consumer online users $530MM PPP loan forgiveness to date supported by fully digital platform 28K Number of outreach calls triggered by Seacoast's proprietary Connections platform 25% % Residential sales originated from alternative delivery channels 46% % of business deposits completed outside of the branch Strong momentum in usage of digital tools and other non-branch delivery channels, and tools to equip our teams to outperform 11% % increase in business online users All metrics compare 2Q’21 to 2Q’20
26 SECOND QUARTER 2021 EARNINGS PRESENTATION Explanation of Certain Unaudited Non-GAAP Financial Measures This presentation contains financial information determined by methods other than Generally Accepted Accounting Principles (“GAAP”). The financial highlights provide reconciliations between GAAP and adjusted financial measures including net income, noninterest income, noninterest expense, tax adjustments and other financial ratios. Management uses these non-GAAP financial measures in its analysis of the Company’s performance and believes these presentations provide useful supplemental information, and a clearer understanding of the Company’s performance. The Company believes the non-GAAP measures enhance investors’ understanding of the Company’s business and performance and if not provided would be requested by the investor community. These measures are also useful in understanding performance trends and facilitate comparisons with the performance of other financial institutions. The limitations associated with operating measures are the risk that persons might disagree as to the appropriateness of items comprising these measures and that different companies might define or calculate these measures differently. The Company provides reconciliations between GAAP and these non-GAAP measures. These disclosures should not be considered an alternative to GAAP.
27 SECOND QUARTER 2021 EARNINGS PRESENTATION GAAP to Non-GAAP Reconciliation Quarterly Trend Six Months Ended (Amounts in thousands except per share data) 2Q'21 1Q'21 4Q'20 3Q'20 2Q'20 2Q'21 2Q'20 Net Income $ 31,410 $ 33,719 $ 29,347 $ 22,628 $ 25,080 $ 65,129 $ 25,789 Total noninterest income 15,322 17,671 14,930 16,946 15,006 32,993 29,694 Securities (gains)/losses, net 55 114 18 (4) (1,230) 169 (1,249) Total Adjustments to Noninterest Income 55 114 18 (4) (1,230) 169 (1,249) Total Adjusted Noninterest Income 15,377 17,785 14,948 16,942 13,776 33,162 28,445 Total noninterest expense 45,784 46,120 43,681 51,674 42,399 91,904 90,197 Merger related charges (509) (581) — (4,281) (240) (1,090) (4,793) Amortization of intangibles (1,212) (1,211) (1,421) (1,497) (1,483) (2,423) (2,939) Business continuity expenses — — — — — — (307) Branch reductions and other expense initiatives (663) (449) (354) (464) — (1,112) — Total Adjustments to Noninterest Expense (2,384) (2,241) (1,775) (6,242) (1,723) (4,625) (8,039) Total Adjusted Noninterest Expense 43,400 43,879 41,906 45,432 40,676 87,279 82,158 Income Taxes 8,785 10,157 8,793 6,992 7,188 18,942 7,033 Tax effect of adjustments 598 577 440 1,530 121 1,175 1,665 Total Adjustments to Income Taxes 598 577 440 1,530 121 1,175 1,665 Adjusted Income Taxes 9,383 10,734 9,233 8,522 7,309 20,117 8,698 Adjusted Net Income $ 33,251 $ 35,497 $ 30,700 $ 27,336 $ 25,452 $ 68,748 $ 30,914 Earnings per diluted share, as reported $ 0.56 $ 0.60 $ 0.53 $ 0.42 $ 0.47 $ 1.17 $ 0.49 Adjusted Earnings per Diluted Share 0.59 0.63 0.55 0.50 0.48 1.23 0.59 Average diluted shares outstanding 55,901 55,992 55,739 54,301 53,308 55,827 52,807
28 SECOND QUARTER 2021 EARNINGS PRESENTATION GAAP to Non-GAAP Reconciliation Quarterly Trend Six Months Ended (Amounts in thousands except per share data) 2Q'21 1Q'21 4Q'20 3Q'20 2Q'20 2Q'21 2Q'20 Adjusted Noninterest Expense $ 43,400 $ 43,879 $ 41,906 $ 45,432 $ 40,676 $ 87,279 $ 82,158 Foreclosed property expense and net gain/(loss) on sale 90 65 (1,821) (512) (245) 155 70 Provision for unfunded commitments — — 795 (756) (178) — (224) Net Adjusted Noninterest Expense $ 43,490 $ 43,944 $ 40,880 $ 44,164 $ 40,253 $ 87,434 $ 82,004 Revenue $ 81,124 $ 84,281 $ 83,721 $ 80,449 $ 82,278 $ 165,405 $ 160,143 Total Adjustments to Revenue 55 114 18 (4) (1,230) 169 (1,249) Impact of FTE adjustment 131 131 112 118 116 262 230 Adjusted Revenue on a Fully Taxable Equivalent Basis $ 81,310 $ 84,526 $ 83,851 $ 80,563 $ 81,164 $ 165,836 $ 159,124 Adjusted Efficiency Ratio 53.49 % 51.99 % 48.75 % 54.82 % 49.60 % 52.72 % 51.53 % Net Interest Income $ 65,802 $ 66,610 $ 68,791 $ 63,503 $ 67,272 $ 132,412 $ 130,449 Impact of FTE adjustment 131 131 112 118 116 262 230 Net Interest Income including FTE adjustment $ 65,933 $ 66,741 $ 68,903 $ 63,621 $ 67,388 $ 132,674 $ 130,679 Total noninterest income 15,322 17,671 14,930 16,946 15,006 32,993 29,694 Total noninterest expense 45,784 46,120 43,681 51,674 42,399 91,904 90,197 Pre-Tax Pre-Provision Earnings $ 35,471 $ 38,292 $ 40,152 $ 28,893 $ 39,995 $ 73,763 $ 70,176 Total Adjustments to Noninterest Income 55 114 18 (4) (1,230) 169 (1,249) Total Adjustments to Noninterest Expense (2,294) (2,176) (2,801) (7,510) (2,146) (4,470) (8,193) Adjusted Pre-Tax Pre-Provision Earnings $ 37,820 $ 40,582 $ 42,971 $ 36,399 $ 40,911 $ 78,402 $ 77,120 Average Assets $ 9,025,846 $ 8,485,354 $ 8,376,396 $ 8,086,890 $ 7,913,002 $ 8,757,093 $ 7,484,272 Less average goodwill and intangible assets (235,964) (237,323) (238,631) (228,801) (230,871) (236,640) (228,791) Average Tangible Assets $ 8,789,882 $ 8,248,031 $ 8,137,765 $ 7,858,089 $ 7,682,131 $ 8,520,453 $ 7,255,481 Return on Average Assets (ROA) 1.40 % 1.61 % 1.39 % 1.11 % 1.27 % 1.50 % 0.69 % Impact of removing average intangible assets and related amortization 0.08 0.09 0.10 0.09 0.10 0.08 0.09
29 SECOND QUARTER 2021 EARNINGS PRESENTATION GAAP to Non-GAAP Reconciliation Quarterly Trend Six Months Ended (Amounts in thousands except per share data) 2Q'21 1Q'21 4Q'20 3Q'20 2Q'20 2Q'21 2Q'20 Return on Average Tangible Assets (ROTA) 1.48 1.70 1.49 1.20 1.37 1.58 0.78 Impact of other adjustments for Adjusted Net Income 0.04 0.05 0.01 0.18 (0.04) 0.05 0.08 Adjusted Return on Average Tangible Assets 1.52 1.75 1.50 1.38 1.33 1.63 0.86 Average Shareholders' Equity $ 1,170,395 $ 1,136,416 $ 1,111,073 $ 1,061,807 $ 1,013,095 $ 1,153,499 $ 1,003,544 Less average goodwill and intangible assets (235,964) (237,323) (238,631) (228,801) (230,871) (236,640) (228,791) Average Tangible Equity $ 934,431 $ 899,093 $ 872,442 $ 833,006 $ 782,224 $ 916,859 $ 774,753 Return on Average Shareholders' Equity 10.76 % 12.03 % 10.51 % 8.48 % 9.96 % 11.39 % 5.17 % Impact of removing average intangible assets and related amortization 3.12 3.59 3.36 2.87 3.51 3.34 2.10 Return on Average Tangible Common Equity (ROTCE) 13.88 15.62 13.87 11.35 13.47 14.73 7.27 Impact of other adjustments for Adjusted Net Income 0.39 0.39 0.13 1.71 (0.38) 0.39 0.75 Adjusted Return on Average Tangible Common Equity 14.27 16.01 14.00 13.06 13.09 15.12 8.02 Loan Interest Income1 $ 60,440 $ 62,390 $ 65,684 $ 60,573 $ 64,929 $ 122,830 $ 128,453 Accretion on acquired loans (2,886) (2,868) (4,448) (3,254) (2,988) (5,754) (7,275) Interest and fees on PPP loans (5,127) (6,886) (5,187) (1,719) (5,068) (12,013) (5,068) Loan interest income excluding PPP and accretion on acquired loans $ 52,427 $ 52,636 $ 56,049 $ 55,600 $ 56,873 $ 105,063 $ 116,110 Yield on Loans1 4.33 % 4.39 % 4.42 % 4.11 % 4.56 % 4.36 % 4.72 % Impact of accretion on acquired loans (0.21) (0.20) (0.30) (0.22) (0.21) (0.20) (0.27) Impact of PPP loans 0.01 (0.04) 0.11 0.33 (0.04) (0.02) (0.01) Yield on loans excluding PPP and accretion on acquired loans 4.13 % 4.15 % 4.23 % 4.22 % 4.31 % 4.14 % 4.44 % 1On a fully taxable equivalent basis. All yields and rates have been computed using amortized cost.
30 SECOND QUARTER 2021 EARNINGS PRESENTATION Quarterly Trend Six Months Ended (Amounts in thousands except per share data) 2Q'21 1Q'21 4Q'20 3Q'20 2Q'20 2Q'21 2Q'20 Net Interest income1 $ 65,933 $ 66,741 $ 68,903 $ 63,621 $ 67,388 $ 132,674 $ 130,679 Accretion on acquired loans (2,886) (2,868) (4,448) (3,254) (2,988) (5,754) (7,275) Interest and fees on PPP loans (5,127) (6,886) (5,187) (1,719) (5,068) (12,013) (5,068) Net interest income excluding PPP and accretion on acquired loans $ 57,920 $ 56,987 $ 59,268 $ 58,648 $ 59,332 $ 114,907 $ 118,336 Net Interest Margin1 3.23 % 3.51 % 3.59 % 3.40 % 3.70 % 3.37 % 3.81 % Impact of accretion on acquired loans (0.14) (0.15) (0.23) (0.17) (0.16) (0.15) (0.25) Impact of PPP loans (0.06) (0.11) 0.01 0.19 (0.08) (0.08) — Net interest margin excluding PPP and accretion on acquired loans 3.03 % 3.25 % 3.37 % 3.42 % 3.46 % 3.14 % 3.56 % Security Interest Income1 $ 6,745 $ 6,485 $ 6,586 $ 7,129 $ 7,725 $ 13,230 $ 16,573 Tax equivalent adjustment on securities (39) (39) (23) (32) (31) (78) (61) Security interest income excluding tax equivalent adjustment $ 6,706 $ 6,446 $ 6,563 $ 7,097 $ 7,694 $ 13,152 $ 16,512 Loan Interest Income1 $ 60,440 $ 62,390 $ 65,684 $ 60,573 $ 64,929 $ 122,830 $ 128,453 Tax equivalent adjustment on loans (92) (92) (89) (86) (85) (184) (169) Loan interest income excluding tax equivalent adjustment $ 60,348 $ 62,298 $ 65,595 $ 60,487 $ 64,844 $ 122,646 $ 128,284 Net Interest Income1 $ 65,933 $ 66,741 $ 68,903 $ 63,621 $ 67,388 $ 132,674 $ 130,679 Tax equivalent adjustment on securities (39) (39) (23) (32) (31) (78) (61) Tax equivalent adjustment on loans (92) (92) (89) (86) (85) (184) (169) Net interest income excluding tax equivalent adjustment $ 65,802 $ 66,610 $ 68,791 $ 63,503 $ 67,272 $ 132,412 $ 130,449 1On a fully taxable equivalent basis. All yields and rates have been computed using amortized cost. GAAP to Non-GAAP Reconciliation