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) April 28, 2022
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 April 28, 2022, Seacoast Banking Corporation of Florida (“Seacoast” or the “Company”) announced its financial results for the quarter and year ended March 31, 2022. A copy of the press release announcing Seacoast’s results for the quarter ended March 31, 2022 is attached hereto as Exhibit 99.1 and incorporated herein by reference.
Item 7.01 Regulation FD Disclosure
On April 29, 2022, Seacoast will hold an investor conference call to discuss its financial results for the quarter and year ended March 31, 2022. 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 March 31, 2022, 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 April 28, 2022, with respect to Seacoast's financial results for the quarter ended March 31, 2022 |
| 99.2 | Data on website containing information used in the conference call to be held on April 29, 2022 |
| 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 Florida Business Bank and Sabal Palm Bank, 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, 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 Apollo Bancshares, Inc., 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 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; the adverse impact of COVID-19 (economic and otherwise) on the Company and its customers, counterparties, employees, and third-party service providers, and the adverse impacts to our business, financial position, results of operations and prospects; 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; 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 including as a result of the financial impact of COVID-19; changes in retail distribution strategies, customer preferences and behavior (including as a result of economic factors); 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 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, successfully acquire and integrate desirable financial institutions and realize expected revenues and revenue synergies; 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, including the impact of supply chain disruptions; reduction in or the termination of Seacoast’s ability to use the online- or mobile-based platform that is critical to the Company’s business growth strategy; the effects of war or other conflicts, including the impacts related to or resulting from Russia’s military action in Ukraine, 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 Paycheck Protection Program (“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 credit losses.
The risks relating to the proposed Apollo Bancshares, Inc. merger include, without limitation, failure to obtain the approval of shareholders of Apollo Bancshares, Inc. and Apollo Bank in connection with the merger; the timing to consummate the proposed merger; the risk that a condition to the closing of the proposed merger may not be satisfied; the risk that a regulatory approval that may be required for the proposed merger is not obtained or is obtained subject to conditions that are not anticipated; the parties' ability to achieve the synergies and value creation contemplated by the proposed merger; the parties' ability to promptly and effectively integrate the businesses of Seacoast and Apollo Bancshares, Inc., including unexpected transaction costs, the costs of integrating operations, severance, professional fees and other expenses; the diversion of
management time on issues related to the merger; the failure to consummate or any delay in consummating the merger for other reasons; changes in laws or regulations; the risks of customer and employee loss and business disruption, including, without limitation, as the result of difficulties in maintaining relationships with employees; increased competitive pressures and solicitations of customers and employees by competitors; and the difficulties and risks inherent with entering new markets.
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, 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.
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: April 28, 2022 | /s/ Tracey L. Dexter |
|---|---|
| TRACEY L. DEXTER | |
| Chief Financial Officer |
1Q2022 Earnings Release
SEACOAST REPORTS FIRST QUARTER 2022 RESULTS
Disciplined Loan Growth, Strong Deposit Growth, and Rising Net Interest Margin Highlight Q1 Results
Well-Positioned Balance Sheet with Strong Capital and Liquidity
STUART, Fla., April 28, 2022 /GLOBE NEWSWIRE/ -- Seacoast Banking Corporation of Florida ("Seacoast" or the "Company") (NASDAQ: SBCF) today reported net income in the first quarter of 2022 of $20.6 million, or $0.33 per diluted share, which includes merger-related costs and a $5.1 million increase in the provision for credit losses associated with acquisition activity during the quarter. First quarter 2022 results represent a decrease of 43% compared to the fourth quarter of 2021, and a decrease of 39% compared to the first quarter of 2021. Adjusted net income1 for the first quarter of 2022 was $27.1 million, or $0.44 per diluted share, which includes the $5.1 million increase in the provision for credit losses associated with acquisition activity. First quarter 2022 adjusted results represent a decrease of 27% compared to the fourth quarter of 2021, and a decrease of 24% compared to the first quarter of 2021. At March 31, 2022, the ratio of tangible common equity to tangible assets was 9.89%, and tangible book value per share was $17.12. A decline in the value of the available for sale securities portfolio driven by rising interest rates during the period impacted the ratio of tangible common equity to tangible assets by 56 basis points and impacted tangible book value per share by $1.07.
For the first quarter of 2022, return on average tangible assets was 0.85%, return on average tangible shareholders' equity was 8.02%, and the efficiency ratio was 62.33%, compared to 1.51%, 14.29%, and 53.70%, respectively, in the prior quarter, and 1.70%, 15.62%, and 53.21%, respectively, in the prior year quarter. Adjusted return on average tangible assets1 in the first quarter of 2022 was 1.06%, adjusted return on average tangible shareholders' equity1 was 10.01%, and the adjusted efficiency ratio1 was 54.86%, compared to 1.49%, 14.11%, and 53.43%, respectively, in the prior quarter, and 1.75%, 16.01%, and 51.99%, respectively, in the prior year quarter.
Charles M. Shaffer, Seacoast's Chairman and CEO, said, “Seacoast’s investments in high-performing commercial banking talent across Florida drove disciplined organic loan growth this quarter and a material increase in the late-stage pipeline entering the second quarter. With broad expectations for rising rates, we believe that Seacoast’s asset-sensitive balance sheet and ample liquidity position us well for growth and the continued expansion of net interest margin, which increased nine basis points during the first quarter of 2022, and rose 14 basis points excluding the effects of PPP and accretion on acquired loans.”
“In the first quarter of 2022, we established a new market presence in Naples, Sarasota, and Jacksonville, and announced the proposed acquisition of Apollo Bancshares, Inc., bringing us five locations in Miami-Dade County. We believe that this expansion into some of the best banking markets in the United States will lead to strong franchise value creation in the coming years,” Shaffer added.
Acquisitions Update
On January 3, 2022, the Company completed the acquisitions of Sabal Palm Bancorp, Inc. (“Sabal Palm”) in Sarasota, and Business Bank of Florida Corp. (“BBFC”) in Brevard County, which added a combined $367.9 million in loans, $562.3 million in deposits, and a $5.1 million provision for credit losses at acquisition. Consolidation activities for BBFC, including system conversion, are substantially complete. System conversion for Sabal Palm is planned early in the second quarter of 2022.
On March 29, 2022, the Company announced its proposed acquisition of Apollo Bancshares, Inc. (“Apollo”). The transaction, which is expected to close early in the fourth quarter of 2022, will expand the Company’s presence in Miami-Dade County, which is part of the Miami-Fort Lauderdale-Pompano Beach MSA, Florida’s largest MSA and the 8th largest in the nation. Apollo operates five branches across Miami-Dade County with deposits of approximately $947 million and loans of $705 million as of March 31, 2022.
1Non-GAAP measure, see “Explanation of Certain Unaudited Non-GAAP Financial Measures" for more information and for a reconciliation to GAAP.
Financial Results
Income Statement
•Net income was $20.6 million, or $0.33 per diluted share for the first quarter of 2022, which includes $6.7 million in merger-related costs associated with acquisition activity during the quarter, and a $5.1 million increase in the provision for credit losses associated with onboarding Sabal Palm and BBFC. This compares to net income of $36.3 million, or $0.62, for the prior quarter, and $33.7 million, or $0.60, for the prior year quarter. Adjusted net income1 for the first quarter of 2022 was $27.1 million, or $0.44 per diluted share, which includes the $5.1 million increase in the provision for credit losses associated with onboarding Sabal Palm and BBFC. This compares to $36.9 million, or $0.62, for the prior quarter, and $35.5 million, or $0.63, for the prior year quarter. In the first quarter of 2022, loan growth including bank acquisitions resulted in a provision for credit losses of $6.6 million, compared to a reversal of provision of $3.9 million in the fourth quarter of 2021 and a reversal of provision of $5.7 million in the first quarter of 2021. Excluded from adjusted net income are $6.7 million in merger-related expenses in the first quarter of 2022, compared to $0.5 million in the fourth quarter of 2021 and $0.6 million in the first quarter of 2021.
•Net revenues were $91.9 million in the first quarter of 2022, an increase of $0.9 million, or 1%, compared to the prior quarter, and an increase of $7.6 million, or 9%, compared to the prior year quarter. Adjusted revenues1 were $92.3 million in the first quarter of 2022, an increase of $1.7 million, or 2%, compared to the prior quarter, and an increase of $8.0 million, or 9%, compared to the prior year quarter.
•Net interest income totaled $76.5 million in the first quarter of 2022, an increase of $4.2 million, or 6%, from the fourth quarter of 2021, and an increase of $9.9 million, or 15%, compared to the first quarter of 2021. Increases relating to higher balances and higher yields on securities and loans were partially offset by declines in PPP interest and fees, while interest expense remained flat.
•Net interest margin increased to 3.25% in the first quarter of 2022 compared to 3.16% in the fourth quarter of 2021, the result of higher yields on non-PPP loans and on securities. Excluding the effect of PPP and accretion on acquired loans, net interest margin increased 14 basis points to 3.05% in the first quarter of 2022 from 2.91% in the fourth quarter of 2021. Securities yields increased 11 basis points to 1.68%, reflecting the impact of the addition of higher yielding securities during the quarter. Non-PPP loan yields increased six basis points to 4.24%. The effect on net interest margin of accretion of purchase discounts on acquired loans in the first quarter of 2022 was an increase of 15 basis points, consistent with the prior quarter. The effect on net interest margin of interest and fees on PPP loans was an increase of five basis points in the first quarter of 2022 compared to an increase of ten basis points in the prior quarter. The cost of deposits remained at only six basis points for the first quarter of 2022. The margin benefited from the Company’s asset sensitivity, combined with disciplined growth across the balance sheet.
•Noninterest income totaled $15.4 million in the first quarter of 2022, a decrease of $3.3 million, or 18%, compared to the prior quarter, and a decrease of $2.3 million, or 13%, compared to the prior year quarter. The decrease from the prior quarter primarily reflects a decrease of $3.4 million in income on SBIC investments, which is expected to vary amongst periods. In addition, the sale of a website domain name resulted in a gain of $0.8 million, benefiting results in the fourth quarter of 2021. Results for the first quarter of 2022 included the following:
•Wealth management income was $2.7 million in the first quarter of 2022, an increase of $0.3 million compared to the prior quarter, reflecting continued success in winning new relationships.
•Mortgage banking fees were $1.7 million, compared to $2.0 million in the prior quarter, the result of lower saleable production due to low housing inventory and slowing refinance demand.
•Other income decreased by $3.4 million in the first quarter of 2022, reflecting lower income on SBIC investments and a gain in the fourth quarter of 2021 on the sale of a website domain name, partially offset by higher loan-swap related income.
•The Company recognized $0.5 million in securities losses in the first quarter of 2022 compared to $0.4 million in the fourth quarter of 2021.
1Non-GAAP measure, see “Explanation of Certain Unaudited Non-GAAP Financial Measures" for more information and for a reconciliation to GAAP.
•The provision for credit losses was $6.6 million in the first quarter of 2022, compared to a net benefit of $3.9 million in the prior quarter. The increase during the quarter included $5.1 million in provisioning for loans acquired in the Sabal Palm and BBFC transactions.
•Noninterest expense was $58.9 million in the first quarter of 2022, an increase of $8.7 million, or 17%, compared to the prior quarter, and an increase of $12.8 million, or 28%, compared to the prior year quarter. The first quarter of 2022 included $6.7 million in merger-related expenses. Changes from the fourth quarter of 2021 included the following:
•Salaries and wages increased $3.2 million to $28.2 million, which included $3.0 million in merger-related expenses associated with the BBFC and Sabal Palm acquisitions.
•Employee benefits increased by $0.7 million to $5.5 million, reflecting higher seasonal payroll taxes and 401(k) contributions.
•Outsourced data processing costs increased by $1.0 million to $6.2 million, which included $0.6 million in merger-related expenses and costs associated with the launch of the Company’s upgraded online and mobile banking platform, which was completed during the first quarter of 2022.
•Legal and professional fees increased by $2.3 million to $4.8 million, which included $2.5 million in merger-related expenses, compared to $0.4 million in the fourth quarter of 2021.
•Seacoast recorded $5.8 million of income tax expense in the first quarter of 2022, compared to $8.3 million in the prior quarter and $10.2 million in the first quarter of 2021. Changes to the Florida corporate income tax rate resulted in benefits of $1.5 million in the fourth quarter of 2021. Tax benefits related to stock-based compensation totaled $0.5 million in the first quarter of 2022, $0.6 million in the fourth quarter of 2021, and were nominal in the first quarter of 2021.
•The ratio of net adjusted noninterest expense1 to average tangible assets was 1.99% in the first quarter of 2022, compared to 1.96% in the prior quarter and 2.16% in the first quarter of 2021.
•The efficiency ratio was 62.33% in the first quarter of 2022, compared to 53.70% in the prior quarter and 53.21% in the prior year quarter. The increase in the first quarter of 2022 primarily reflects the impact of merger-related expenses. The adjusted efficiency ratio1 was 54.86% in the first quarter of 2022, compared to 53.43% in the prior quarter and 51.99% in the prior year quarter.
Balance Sheet
•At March 31, 2022, the Company had total assets of $10.9 billion and total shareholders' equity of $1.4 billion. Book value per share was $22.15 on March 31, 2022, compared to $22.40 on December 31, 2021, and $20.89 on March 31, 2021. Tangible book value per share totaled $17.12 on March 31, 2022 compared to $17.84 on December 31, 2021 and $16.62 on March 31, 2021. A decline in the value of the available for sale securities portfolio driven by rising interest rates during the period impacted tangible book value per share by $1.07.
•Debt securities totaled $2.5 billion on March 31, 2022, an increase of $170.7 million, or 7%, compared to December 31, 2021. Purchases during the first quarter of 2022 totaled $379.3 million, consisting primarily of agency-issued securities. The Company continues to take a prudent and disciplined approach to reinvesting liquidity.
•Loans totaled $6.5 billion on March 31, 2022, an increase of $526.2 million, or 9%, compared to December 31, 2021. Changes during the first quarter of 2022 include $367.9 million added through bank acquisitions, and the purchase of a $111.3 million residential loan pool. Removing the impact of loans added through acquisitions, the purchased pool during the quarter and PPP loans, loans outstanding grew 7% on an annualized basis. The company continues to exercise a disciplined approach to loan growth, carefully underwriting loans to strict underwriting guidelines.
•Loan originations were $678.7 million in the first quarter of 2022, an increase of 13% compared to $599.9 million in the fourth quarter of 2021.
1Non-GAAP measure, see “Explanation of Certain Unaudited Non-GAAP Financial Measures" for more information and for a reconciliation to GAAP.
•Commercial originations were $373.0 million during the first quarter of 2022, compared to $408.9 million in the fourth quarter of 2021, and $204.3 million in the first quarter of 2021. Despite a seasonally slower quarter, commercial originations remained strong and pipelines continued to build during the quarter.
•Consumer originations in the first quarter of 2022 increased to $79.0 million from $72.6 million in the fourth quarter of 2021 and from $46.7 million in the first quarter of 2021.
•Residential loans originated for sale in the secondary market totaled $51.2 million in the first quarter of 2022, compared to $69.2 million in the fourth quarter of 2021 and $138.3 million in the first quarter of 2021. Limited housing inventory and slowing refinance activity contributed to lower production.
•Closed residential loans retained in the portfolio totaled $175.5 million in the first quarter of 2022, compared to $49.1 million in the fourth quarter of 2021, and $46.6 million in the first quarter of 2021. The first quarter of 2022 included the purchase of a $111.3 million high-quality wholesale residential home mortgage loan pool from a seller well known to Seacoast.
•Pipelines (loans in underwriting and approval or approved and not yet closed) totaled $794.9 million on March 31, 2022, an increase of 64% from December 31, 2021 and an increase of 83% from March 31, 2021.
•Commercial pipelines were $619.5 million as of March 31, 2022, an increase of 56% from $397.8 million at December 31, 2021, and an increase of 157% from $240.9 million at March 31, 2021. The increase in pipeline reflects the addition of well-established commercial bankers and expansion into new markets across the state. The addition of experienced commercial bankers over the last 12 months is generating disciplined growth in full relationships, including credit facilities, deposit relationships, and wealth opportunities.
•Consumer pipelines were $61.6 million as of March 31, 2022, compared to $29.7 million at December 31, 2021, and $28.1 million at March 31, 2021. The increase is primarily the result of consumer lending teams that joined in late 2021.
•Residential saleable pipelines were $25.7 million as of March 31, 2022, compared to $30.1 million at December 31, 2021, and $92.1 million at March 31, 2021. Retained residential pipelines were $88.0 million as of March 31, 2022, compared to $25.6 million at December 31, 2021, and $72.4 million at March 31, 2021.
•Total deposits were $9.2 billion as of March 31, 2022, an increase of $1.2 billion, or 15%, compared to December 31, 2021, and an increase of $1.9 billion, or 25%, compared to March 31, 2021.
•The acquisitions of BBFC and Sabal Palm resulted in additions of $562.3 million in total deposits during the first quarter of 2022. Removing the impact of acquisitions and wholesale activity, deposits increased 25% on an annualized basis.
•Transaction account balances, excluding those acquired from BBFC and Sabal Palm, increased $498 million, or 10%, quarter-over-quarter, and at March 31, 2022, total transaction account balances represent 62% of overall deposit funding.
•The Company manages excess liquidity on the balance sheet through participation in programs with third-party deposit networks. Through these programs, the Company can offer its customers access to FDIC insurance on large balances with attractive terms, and the Company can retain or sell, on an overnight basis, the underlying deposits. At March 31, 2022, the Company had sold, on an overnight basis, $231 million in deposits compared to $228 million at December 31, 2021, and $99 million at March 31, 2021. These deposits are not included in the consolidated balance sheet.
•The overall cost of deposits remained flat quarter over quarter at six basis points.
•As of March 31, 2022, deposits per banking center were $163.4 million, compared to $153.6 million at December 31, 2021.
1Non-GAAP measure, see “Explanation of Certain Unaudited Non-GAAP Financial Measures" for more information and for a reconciliation to GAAP.
Asset Quality
•Credit metrics remain strong with charge-offs, nonaccruals, and criticized assets at historically low levels.
•Nonperforming loans decreased by $4.4 million to $26.2 million at March 31, 2022. Nonperforming loans to total loans outstanding were 0.41% at March 31, 2022, 0.52% at December 31, 2021, and 0.62% at March 31, 2021.
•Nonperforming assets to total assets were 0.35% at March 31, 2022, 0.46% at December 31, 2021, and 0.58% at March 31, 2021.
•The ratio of allowance for credit losses to total loans was 1.39% at March 31, 2022, 1.41% at December 31, 2021, and 1.53% at March 31, 2021. Excluding PPP loans, the ratio of allowance for credit losses to total loans at March 31, 2022 was 1.40%, compared to 1.43% at December 31, 2021 and 1.71% at March 31, 2021.
•Net charge-offs were $0.1 million, or less than 0.01%, for the first quarter of 2022 compared to $0.6 million, or 0.04%, of average loans in the fourth quarter of 2021 and $0.4 million, or 0.03%, of average loans in the first quarter of 2021. Net charge-offs for the four most recent quarters averaged 0.05%.
•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. Seacoast's average commercial loan size is $524,000, 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 22% and 189% of total bank-level risk-based capital, respectively, compared to 21% and 177% respectively, at December 31, 2021. On a consolidated basis, construction and land development and commercial real estate loans represent 20% and 172%, respectively, of total consolidated risk-based capital.
Capital and Liquidity
•The Company continues to operate with a fortress balance sheet, with a tier 1 capital ratio at March 31, 2022, of 16.8% compared to 17.4% at December 31, 2021, and 18.1% at March 31, 2021. The total capital ratio was 17.7% and the tier 1 leverage ratio was 11.7% at March 31, 2022.
•Cash and cash equivalents at March 31, 2022 totaled $1.2 billion, an increase of $484.8 million, or 66%, from December 31, 2021, reflecting the impact of deposit growth in the first quarter of 2022 and of strategic liquidity management activities.
•Tangible common equity to tangible assets was 9.89% at March 31, 2022, compared to 11.09% at December 31, 2021, and 10.71% at March 31, 2021. Declines in the value of available for sale securities due to rising interest rates in the first quarter of 2022 negatively impacted equity by $66.0 million.
•At March 31, 2022, the Company had available unsecured lines of credit of $165.0 million and lines of credit under lendable collateral value of $2.3 billion. Additionally, $2.0 billion of debt securities and $684.3 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 | |||||||||||||||
| 1Q'22 | 4Q'21 | 3Q'21 | 2Q'21 | 1Q'21 | |||||||||||
| Selected Balance Sheet Data: | |||||||||||||||
| Total Assets | $ | 10,904,817 | $ | 9,681,433 | $ | 9,893,498 | $ | 9,316,833 | $ | 8,811,820 | |||||
| Gross Loans | 6,451,217 | 5,925,029 | 5,905,884 | 5,437,049 | 5,661,492 | ||||||||||
| Total Deposits | 9,243,768 | 8,067,589 | 8,334,172 | 7,836,436 | 7,385,749 | ||||||||||
| Performance Measures: | |||||||||||||||
| Net Income | $ | 20,588 | $ | 36,330 | $ | 22,944 | $ | 31,410 | $ | 33,719 | |||||
| Net Interest Margin | 3.25 | % | 3.16 | % | 3.22 | % | 3.23 | % | 3.51 | % | |||||
| Average Diluted Shares Outstanding | 61,704 | 59,016 | 57,645 | 55,901 | 55,992 | ||||||||||
| Diluted Earnings Per Share (EPS) | $ | 0.33 | $ | 0.62 | $ | 0.40 | $ | 0.56 | $ | 0.60 | |||||
| Return on (annualized): | |||||||||||||||
| Average Assets (ROA) | 0.79 | % | 1.43 | % | 0.93 | % | 1.40 | % | 1.61 | % | |||||
| Average Tangible Assets (ROTA)2 | 0.85 | 1.51 | 1.00 | 1.48 | 1.70 | ||||||||||
| Average Tangible Common Equity (ROTCE)2 | 8.02 | 14.29 | 9.56 | 13.88 | 15.62 | ||||||||||
| Tangible Common Equity to Tangible Assets2 | 9.89 | 11.09 | 10.62 | 10.43 | 10.71 | ||||||||||
| Tangible Book Value Per Share2 | $ | 17.12 | $ | 17.84 | $ | 17.52 | $ | 17.08 | $ | 16.62 | |||||
| Efficiency Ratio | 62.33 | % | 53.70 | % | 59.55 | % | 54.93 | % | 53.21 | % | |||||
| Adjusted Operating Measures1: | |||||||||||||||
| Adjusted Net Income | $ | 27,056 | $ | 36,854 | $ | 29,350 | $ | 33,251 | $ | 35,497 | |||||
| Adjusted Diluted EPS | 0.44 | 0.62 | 0.51 | 0.59 | 0.63 | ||||||||||
| Adjusted ROTA2 | 1.06 | % | 1.49 | % | 1.23 | % | 1.52 | % | 1.75 | % | |||||
| Adjusted ROTCE2 | 10.01 | 14.11 | 11.72 | 14.27 | 16.01 | ||||||||||
| Adjusted Efficiency Ratio | 54.86 | 53.43 | 51.50 | 53.49 | 51.99 | ||||||||||
| Net Adjusted Noninterest Expense as a<br><br>Percent of Average Tangible Assets2 | 1.99 | 1.96 | 1.95 | 1.98 | 2.16 | ||||||||||
| Other Data: | |||||||||||||||
| Market capitalization3 | $ | 2,144,586 | $ | 2,070,465 | $ | 1,972,784 | $ | 1,893,141 | $ | 2,003,866 | |||||
| Full-time equivalent employees | 1,066 | 989 | 995 | 946 | 953 | ||||||||||
| Number of ATMs | 79 | 75 | 72 | 75 | 75 | ||||||||||
| Full-service banking offices | 58 | 54 | 52 | 48 | 48 | ||||||||||
| 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. |
First Quarter 2022 Strategic Highlights
Capitalizing on Seacoast’s Commitment to Digital Transformation
•Seacoast successfully launched an upgraded online and mobile banking platform in February 2022 that unifies the user experience, offering new functionality and consistent features across all devices. New features include Zelle®, account aggregation, reporting tools and more. The enhanced digital banking experience for both consumers and businesses complements exceptional branch, ATM, and telephone banking services to deliver a competitive value proposition.
Driving Sustainable Growth and Expanding our Footprint
•Seacoast’s balanced growth strategy includes organic growth initiatives across the state. Seacoast expanded its footprint in Naples/Southwest Florida and Jacksonville/Northeast Florida with key additions to its commercial banking leadership and teams. In the first quarter of 2022, Seacoast added 14 experienced bankers in the state’s most dynamic and fastest growing markets and expects to continue to invest in well-established seasoned bankers over the remainder of the year.
•With a focus on leading sustainable growth while maintaining Seacoast’s commitment to disciplined underwriting standards, James Stallings joined Seacoast as executive vice president and chief credit officer. Stallings’ career includes over two decades with BB&T where, as a senior credit executive, he oversaw a large team of credit officers and a $60 billion portfolio. In addition, he has held a diverse set of roles, including overseeing credit for the commercial community bank, corporate C&I, and specialty finance.
Scaling and Evolving Our Culture
•A strong history of value-creating acquisitions continues to benefit shareholders and provide new opportunities for associates. The Seacoast team grew during the first quarter of 2022 with the addition of experienced bankers and the merging of the teams from Sabal Palm Bank and Florida Business Bank. The combined scale and talent further supports our sustainable, profitable growth.
•Seacoast was recognized by the Human Rights Foundation for earning a perfect score of 100 for workplace equality on the 2022 Corporate Equality Index. This is the third consecutive year Seacoast has earned such recognition for its employment practices.
OTHER INFORMATION
Conference Call Information
Seacoast will host a conference call on April 29, 2022 at 10:00 a.m. (Eastern Time) to discuss the first quarter 2022 earnings results and business trends. Investors may call in (toll-free) by dialing (866) 374-5140 (passcode: 9139 5012; 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 April 29, 2022, and can be accessed via a link at www.SeacoastBanking.com under the heading “Corporate Information,” using the passcode EV00133935.
Alternatively, individuals may listen to the live webcast of the presentation by visiting Seacoast's website at www.SeacoastBanking.com. The link is located under the heading “Corporate Information.” Beginning late afternoon on April 29, 2022, 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 (NASDAQ: SBCF) is one of the largest community banks headquartered in Florida with approximately $10.9 billion in assets and $9.2 billion in deposits as of March 31, 2022. Seacoast provides integrated financial services including commercial and consumer banking, wealth management, and mortgage services to customers at over 50 full-service branches across Florida, and through advanced mobile and online banking solutions. Seacoast National Bank is the wholly-owned subsidiary bank of Seacoast Banking Corporation of Florida. For more information about Seacoast, visit www.SeacoastBanking.com.
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 Apollo Bancshares, Inc., 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 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; the adverse impact of COVID-19 (economic and otherwise) on the Company and its customers, counterparties, employees, and third-party service providers, and the adverse impacts to our business, financial position, results of operations and prospects; 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; 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 including as a result of the financial impact of COVID-19; changes in retail distribution strategies, customer preferences and behavior (including as a result of economic factors); 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 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, successfully acquire and integrate desirable financial institutions and realize expected revenues and revenue synergies; 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, including the impact of supply chain disruptions; reduction in or the termination of Seacoast’s ability to use the online- or mobile-based platform that is critical to the Company’s business growth strategy; the effects of war or other conflicts, including the impacts related to or resulting from Russia’s military action in Ukraine, 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 Paycheck Protection Program (“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 credit losses.
The risks relating to the proposed Apollo Bancshares, Inc. merger include, without limitation, failure to obtain the approval of shareholders of Apollo Bancshares, Inc. and Apollo Bank in connection with the merger; the timing to consummate the proposed merger; the risk that a condition to the closing of the proposed merger may not be satisfied; the risk that a regulatory approval that may be required for the proposed merger is not obtained or is obtained subject to conditions that are not anticipated; the parties' ability to achieve the synergies and value creation contemplated by the proposed merger; the parties' ability to promptly and effectively integrate the businesses of Seacoast and Apollo Bancshares, Inc., including unexpected transaction costs, the costs of integrating operations, severance, professional fees and other expenses; the diversion of management time on issues related to the merger; the failure to consummate or any delay in consummating the merger for other reasons; changes in laws or regulations; the risks of customer and employee loss and business disruption, including, without limitation, as the result of difficulties in maintaining relationships with employees; increased competitive pressures and solicitations of customers and employees by competitors; and the difficulties and risks inherent with entering new markets.
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, 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.
| FINANCIAL HIGHLIGHTS | (Unaudited) | |||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES | ||||||||||||||||||
| Quarterly Trends | ||||||||||||||||||
| (Amounts in thousands, except ratios and per share data) | 1Q'22 | 4Q'21 | 3Q'21 | 2Q'21 | 1Q'21 | |||||||||||||
| Summary of Earnings | ||||||||||||||||||
| Net income | $ | 20,588 | $ | 36,330 | $ | 22,944 | $ | 31,410 | $ | 33,719 | ||||||||
| Adjusted net income1 | 27,056 | 36,854 | 29,350 | 33,251 | 35,497 | |||||||||||||
| Net interest income2 | 76,639 | 72,412 | 71,455 | 65,933 | 66,741 | |||||||||||||
| Net interest margin2,3 | 3.25 | % | 3.16 | % | 3.22 | % | 3.23 | % | 3.51 | % | ||||||||
| Performance Ratios | ||||||||||||||||||
| Return on average assets-GAAP basis3 | 0.79 | % | 1.43 | % | 0.93 | % | 1.40 | % | 1.61 | % | ||||||||
| Return on average tangible assets-GAAP basis3,4 | 0.85 | 1.51 | 1.00 | 1.48 | 1.70 | |||||||||||||
| Adjusted return on average tangible assets1,3,4 | 1.06 | 1.49 | 1.23 | 1.52 | 1.75 | |||||||||||||
| Net adjusted noninterest expense to average tangible assets1,3,4 | 1.99 | 1.96 | 1.95 | 1.98 | 2.16 | |||||||||||||
| Return on average shareholders' equity-GAAP basis3 | 5.96 | 11.06 | 7.29 | 10.76 | 12.03 | |||||||||||||
| Return on average tangible common equity-GAAP basis3,4 | 8.02 | 14.29 | 9.56 | 13.88 | 15.62 | |||||||||||||
| Adjusted return on average tangible common equity1,3,4 | 10.01 | 14.11 | 11.72 | 14.27 | 16.01 | |||||||||||||
| Efficiency ratio5 | 62.33 | 53.70 | 59.55 | 54.93 | 53.21 | |||||||||||||
| Adjusted efficiency ratio1 | 54.86 | 53.43 | 51.50 | 53.49 | 51.99 | |||||||||||||
| Noninterest income to total revenue (excluding securities gains/losses) | 17.14 | 20.89 | 21.09 | 18.94 | 21.07 | |||||||||||||
| Tangible common equity to tangible assets4 | 9.89 | 11.09 | 10.62 | 10.43 | 10.71 | |||||||||||||
| Average loan-to-deposit ratio | 71.25 | 70.29 | 69.97 | 74.13 | 81.39 | |||||||||||||
| End of period loan-to-deposit ratio | 70.01 | 73.84 | 71.46 | 69.93 | 77.48 | |||||||||||||
| Per Share Data | ||||||||||||||||||
| Net income diluted-GAAP basis | $ | 0.33 | $ | 0.62 | $ | 0.40 | $ | 0.56 | $ | 0.60 | ||||||||
| Net income basic-GAAP basis | 0.34 | 0.62 | 0.40 | 0.57 | 0.61 | |||||||||||||
| Adjusted earnings1 | 0.44 | 0.62 | 0.51 | 0.59 | 0.63 | |||||||||||||
| Book value per share common | 22.15 | 22.40 | 22.12 | 21.33 | 20.89 | |||||||||||||
| Tangible book value per share | 17.12 | 17.84 | 17.52 | 17.08 | 16.62 | |||||||||||||
| Cash dividends declared | 0.13 | 0.13 | 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 | ||||||||||||||||||
| (Amounts in thousands, except per share data) | 1Q'22 | 4Q'21 | 3Q'21 | 2Q'21 | 1Q'21 | |||||||||||||
| Interest on securities: | ||||||||||||||||||
| Taxable | $ | 10,041 | $ | 8,574 | $ | 7,775 | $ | 6,559 | $ | 6,298 | ||||||||
| Nontaxable | 140 | 139 | 143 | 147 | 148 | |||||||||||||
| Fees on PPP loans | 1,373 | 3,011 | 5,218 | 3,877 | 5,390 | |||||||||||||
| Interest on PPP loans | 150 | 341 | 699 | 1,251 | 1,496 | |||||||||||||
| Interest and fees on loans - excluding PPP loans | 65,595 | 61,049 | 58,507 | 55,220 | 55,412 | |||||||||||||
| Interest on federal funds sold and other investments | 933 | 828 | 867 | 709 | 586 | |||||||||||||
| Total Interest Income | 78,232 | 73,942 | 73,209 | 67,763 | 69,330 | |||||||||||||
| Interest on deposits | 767 | 711 | 849 | 980 | 1,065 | |||||||||||||
| Interest on time certificates | 468 | 494 | 583 | 524 | 1,187 | |||||||||||||
| Interest on borrowed money | 475 | 448 | 453 | 457 | 468 | |||||||||||||
| Total Interest Expense | 1,710 | 1,653 | 1,885 | 1,961 | 2,720 | |||||||||||||
| Net Interest Income | 76,522 | 72,289 | 71,324 | 65,802 | 66,610 | |||||||||||||
| Provision for credit losses | 6,556 | (3,942) | 5,091 | (4,855) | (5,715) | |||||||||||||
| Net Interest Income After Provision for Credit Losses | 69,966 | 76,231 | 66,233 | 70,657 | 72,325 | |||||||||||||
| Noninterest income: | ||||||||||||||||||
| Service charges on deposit accounts | 2,801 | 2,606 | 2,495 | 2,338 | 2,338 | |||||||||||||
| Interchange income | 4,128 | 4,135 | 4,131 | 4,145 | 3,820 | |||||||||||||
| Wealth management income | 2,659 | 2,356 | 2,562 | 2,387 | 2,323 | |||||||||||||
| Mortgage banking fees | 1,686 | 2,030 | 2,550 | 2,977 | 4,225 | |||||||||||||
| Marine finance fees | 191 | 147 | 152 | 177 | 189 | |||||||||||||
| SBA gains | 156 | 200 | 812 | 232 | 287 | |||||||||||||
| BOLI income | 1,334 | 1,295 | 1,128 | 872 | 859 | |||||||||||||
| Other | 2,870 | 6,316 | 5,228 | 2,249 | 3,744 | |||||||||||||
| 15,825 | 19,085 | 19,058 | 15,377 | 17,785 | ||||||||||||||
| Securities losses, net | (452) | (379) | (30) | (55) | (114) | |||||||||||||
| Total Noninterest Income | 15,373 | 18,706 | 19,028 | 15,322 | 17,671 | |||||||||||||
| Noninterest expenses: | ||||||||||||||||||
| Salaries and wages | 28,219 | 25,005 | 27,919 | 22,966 | 21,393 | |||||||||||||
| Employee benefits | 5,501 | 4,763 | 4,177 | 3,953 | 4,980 | |||||||||||||
| Outsourced data processing costs | 6,156 | 5,165 | 5,610 | 4,676 | 4,468 | |||||||||||||
| Telephone / data lines | 733 | 790 | 810 | 838 | 785 | |||||||||||||
| Occupancy | 3,986 | 3,500 | 3,541 | 3,310 | 3,789 | |||||||||||||
| Furniture and equipment | 1,426 | 1,403 | 1,567 | 1,166 | 1,254 | |||||||||||||
| Marketing | 1,171 | 1,060 | 1,353 | 1,002 | 1,168 | |||||||||||||
| Legal and professional fees | 4,789 | 2,461 | 4,151 | 2,182 | 2,582 | |||||||||||||
| FDIC assessments | 789 | 713 | 651 | 515 | 526 | |||||||||||||
| Amortization of intangibles | 1,446 | 1,304 | 1,306 | 1,212 | 1,211 | |||||||||||||
| Foreclosed property expense and net (gain) loss on sale | (164) | (175) | 66 | (90) | (65) | |||||||||||||
| Provision for credit losses on unfunded commitments | 142 | — | 133 | — | — | |||||||||||||
| Other | 4,723 | 4,274 | 3,984 | 4,054 | 4,029 | |||||||||||||
| Total Noninterest Expense | 58,917 | 50,263 | 55,268 | 45,784 | 46,120 | |||||||||||||
| Income Before Income Taxes | 26,422 | 44,674 | 29,993 | 40,195 | 43,876 | |||||||||||||
| Income taxes | 5,834 | 8,344 | 7,049 | 8,785 | 10,157 | |||||||||||||
| Net Income | $ | 20,588 | $ | 36,330 | $ | 22,944 | $ | 31,410 | $ | 33,719 | ||||||||
| Per share of common stock: | ||||||||||||||||||
| Net income diluted | $ | 0.33 | $ | 0.62 | $ | 0.40 | $ | 0.56 | $ | 0.60 | ||||||||
| Net income basic | 0.34 | 0.62 | 0.40 | 0.57 | 0.61 | |||||||||||||
| Cash dividends declared | 0.13 | 0.13 | 0.13 | 0.13 | — | |||||||||||||
| Average diluted shares outstanding | 61,704 | 59,016 | 57,645 | 55,901 | 55,992 | |||||||||||||
| Average basic shares outstanding | 61,127 | 58,462 | 57,148 | 55,421 | 55,271 | |||||||||||||
| CONDENSED CONSOLIDATED BALANCE SHEETS | (Unaudited) | |||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | |||||||
| SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES | ||||||||||||||||||
| March 31, | December 31, | September 30, | June 30, | March 31, | ||||||||||||||
| (Amounts in thousands) | 2022 | 2021 | 2021 | 2021 | 2021 | |||||||||||||
| Assets | ||||||||||||||||||
| Cash and due from banks | $ | 351,128 | $ | 238,750 | $ | 199,460 | $ | 97,468 | $ | 89,123 | ||||||||
| Interest bearing deposits with other banks | 871,387 | 498,979 | 1,028,235 | 1,351,377 | 890,202 | |||||||||||||
| Total Cash and Cash Equivalents | 1,222,515 | 737,729 | 1,227,695 | 1,448,845 | 979,325 | |||||||||||||
| Time deposits with other banks | 5,975 | — | 750 | 750 | 750 | |||||||||||||
| Debt Securities: | ||||||||||||||||||
| Available for sale (at fair value) | 1,706,619 | 1,644,319 | 1,546,155 | 1,322,776 | 1,051,396 | |||||||||||||
| Held to maturity (at amortized cost) | 747,004 | 638,640 | 526,502 | 493,467 | 512,307 | |||||||||||||
| Total Debt Securities | 2,453,623 | 2,282,959 | 2,072,657 | 1,816,243 | 1,563,703 | |||||||||||||
| Loans held for sale | 20,615 | 31,791 | 49,597 | 42,793 | 60,924 | |||||||||||||
| Loans | 6,451,217 | 5,925,029 | 5,905,884 | 5,437,049 | 5,661,492 | |||||||||||||
| Less: Allowance for credit losses | (89,838) | (83,315) | (87,823) | (81,127) | (86,643) | |||||||||||||
| Net Loans | 6,361,379 | 5,841,714 | 5,818,061 | 5,355,922 | 5,574,849 | |||||||||||||
| Bank premises and equipment, net | 74,617 | 72,404 | 71,250 | 69,392 | 70,385 | |||||||||||||
| Other real estate owned | 11,567 | 13,618 | 13,628 | 12,804 | 15,549 | |||||||||||||
| Goodwill | 286,606 | 252,154 | 252,154 | 221,176 | 221,176 | |||||||||||||
| Other intangible assets, net | 21,549 | 14,845 | 16,153 | 14,106 | 15,382 | |||||||||||||
| Bank owned life insurance | 206,375 | 205,041 | 193,747 | 158,506 | 132,634 | |||||||||||||
| Net deferred tax assets | 47,222 | 27,321 | 24,187 | 21,839 | 24,497 | |||||||||||||
| Other assets | 192,774 | 201,857 | 153,619 | 154,457 | 152,646 | |||||||||||||
| Total Assets | $ | 10,904,817 | $ | 9,681,433 | $ | 9,893,498 | $ | 9,316,833 | $ | 8,811,820 | ||||||||
| Liabilities and Shareholders' Equity | ||||||||||||||||||
| Liabilities | ||||||||||||||||||
| Deposits | ||||||||||||||||||
| Noninterest demand | $ | 3,522,700 | $ | 3,075,534 | $ | 3,086,466 | $ | 2,952,160 | $ | 2,685,247 | ||||||||
| Interest-bearing demand | 2,253,562 | 1,890,212 | 1,845,165 | 1,763,884 | 1,647,935 | |||||||||||||
| Savings | 937,839 | 895,019 | 834,309 | 811,516 | 768,362 | |||||||||||||
| Money market | 1,999,027 | 1,651,881 | 1,951,639 | 1,807,190 | 1,671,179 | |||||||||||||
| Other time certificates | 397,491 | 404,601 | 437,973 | 335,370 | 373,297 | |||||||||||||
| Brokered time certificates | — | — | 20,000 | 20,000 | 93,500 | |||||||||||||
| Time certificates of more than $250,000 | 133,149 | 150,342 | 158,620 | 146,316 | 146,229 | |||||||||||||
| Total Deposits | 9,243,768 | 8,067,589 | 8,334,172 | 7,836,436 | 7,385,749 | |||||||||||||
| Securities sold under agreements to repurchase | 120,922 | 121,565 | 105,548 | 119,973 | 109,171 | |||||||||||||
| Subordinated debt | 71,716 | 71,646 | 71,576 | 71,506 | 71,436 | |||||||||||||
| Other liabilities | 112,126 | 109,897 | 91,682 | 106,571 | 90,115 | |||||||||||||
| Total Liabilities | 9,548,532 | 8,370,697 | 8,602,978 | 8,134,486 | 7,656,471 | |||||||||||||
| Shareholders' Equity | ||||||||||||||||||
| Common stock | 6,124 | 5,850 | 5,835 | 5,544 | 5,529 | |||||||||||||
| Additional paid in capital | 1,062,462 | 963,851 | 959,644 | 862,598 | 858,688 | |||||||||||||
| Retained earnings | 371,192 | 358,598 | 329,918 | 314,584 | 290,420 | |||||||||||||
| Treasury stock | (10,459) | (10,569) | (10,146) | (10,180) | (8,693) | |||||||||||||
| 1,429,319 | 1,317,730 | 1,285,251 | 1,172,546 | 1,145,944 | ||||||||||||||
| Accumulated other comprehensive income, net | (73,034) | (6,994) | 5,269 | 9,801 | 9,405 | |||||||||||||
| Total Shareholders' Equity | 1,356,285 | 1,310,736 | 1,290,520 | 1,182,347 | 1,155,349 | |||||||||||||
| Total Liabilities & Shareholders' Equity | $ | 10,904,817 | $ | 9,681,433 | $ | 9,893,498 | $ | 9,316,833 | $ | 8,811,820 | ||||||||
| Common shares outstanding | 61,239 | 58,504 | 58,349 | 55,436 | 55,294 | |||||||||||||
| CONSOLIDATED QUARTERLY FINANCIAL DATA | (Unaudited) | |||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | ||
| SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES | ||||||||||||||||||
| (Amounts in thousands) | 1Q'22 | 4Q'21 | 3Q'21 | 2Q'21 | 1Q'21 | |||||||||||||
| Credit Analysis | ||||||||||||||||||
| Net charge-offs - non-acquired loans | $ | 72 | $ | 541 | $ | 198 | $ | 214 | $ | 292 | ||||||||
| Net charge-offs - acquired loans | 7 | 29 | 1,234 | 441 | 78 | |||||||||||||
| Total Net Charge-offs | 79 | 570 | 1,432 | 655 | 370 | |||||||||||||
| Net charge-offs to average loans - non-acquired loans | — | % | 0.04 | % | 0.01 | % | 0.02 | % | 0.02 | % | ||||||||
| Net charge-offs to average loans - acquired loans | — | — | 0.09 | 0.03 | 0.01 | |||||||||||||
| Total Net Charge-offs to Average Loans | — | 0.04 | 0.10 | 0.05 | 0.03 | |||||||||||||
| Allowance for credit losses - non-acquired loans | $ | 67,261 | $ | 64,710 | $ | 64,740 | $ | 64,525 | $ | 66,523 | ||||||||
| Allowance for credit losses - acquired loans | 22,577 | 18,605 | 23,083 | 16,602 | 20,120 | |||||||||||||
| Total Allowance for Credit Losses | $ | 89,838 | $ | 83,315 | $ | 87,823 | $ | 81,127 | $ | 86,643 | ||||||||
| Non-acquired loans at end of period | $ | 5,169,973 | $ | 4,860,171 | $ | 4,608,801 | $ | 4,290,622 | $ | 4,208,911 | ||||||||
| Acquired loans at end of period | 1,241,988 | 973,751 | 1,106,481 | 782,315 | 870,928 | |||||||||||||
| Paycheck Protection Program loans at end of period | 39,256 | 91,107 | 190,602 | 364,112 | 581,653 | |||||||||||||
| Total Loans | $ | 6,451,217 | $ | 5,925,029 | $ | 5,905,884 | $ | 5,437,049 | $ | 5,661,492 | ||||||||
| Non-acquired loans allowance for credit losses to non-acquired loans at end of period | 1.30 | % | 1.33 | % | 1.40 | % | 1.50 | % | 1.58 | % | ||||||||
| Total allowance for credit losses to total loans at end of period | 1.39 | 1.41 | 1.49 | 1.49 | 1.53 | |||||||||||||
| Total allowance for credit losses to total loans, excluding PPP loans | 1.40 | 1.43 | 1.54 | 1.60 | 1.71 | |||||||||||||
| Purchase discount on acquired loans at end of period | 1.89 | 2.27 | 2.27 | 2.98 | 2.93 | |||||||||||||
| End of Period | ||||||||||||||||||
| Nonperforming loans | $ | 26,209 | $ | 30,598 | $ | 32,612 | $ | 32,920 | $ | 35,328 | ||||||||
| Other real estate owned | 9,256 | 12,223 | 11,843 | 11,019 | 10,836 | |||||||||||||
| Properties previously used in bank operations included in other real estate owned | 2,310 | 1,395 | 1,785 | 1,785 | 4,713 | |||||||||||||
| Total Nonperforming Assets | $ | 37,775 | $ | 44,216 | $ | 46,240 | $ | 45,724 | $ | 50,877 | ||||||||
| Accruing troubled debt restructures (TDRs) | $ | 4,454 | $ | 3,917 | $ | 4,047 | $ | 4,037 | $ | 4,067 | ||||||||
| Nonperforming Loans to Loans at End of Period | 0.41 | % | 0.52 | % | 0.55 | % | 0.61 | % | 0.62 | % | ||||||||
| Nonperforming Assets to Total Assets at End of Period | 0.35 | 0.46 | 0.47 | 0.49 | 0.58 | |||||||||||||
| March 31, | December 31, | September 30, | June 30, | March 31, | ||||||||||||||
| Loans | 2022 | 2021 | 2021 | 2021 | 2021 | |||||||||||||
| Construction and land development | $ | 259,421 | $ | 230,824 | $ | 227,459 | $ | 234,347 | $ | 227,117 | ||||||||
| Commercial real estate - owner occupied | 1,284,515 | 1,197,774 | 1,201,336 | 1,127,640 | 1,133,085 | |||||||||||||
| Commercial real estate - non-owner occupied | 1,966,150 | 1,736,439 | 1,673,587 | 1,412,439 | 1,438,365 | |||||||||||||
| Residential real estate | 1,599,645 | 1,425,354 | 1,467,329 | 1,226,536 | 1,246,549 | |||||||||||||
| Commercial and financial | 1,132,506 | 1,069,356 | 982,552 | 900,206 | 860,813 | |||||||||||||
| Consumer | 169,724 | 174,175 | 163,019 | 171,769 | 173,910 | |||||||||||||
| Paycheck Protection Program | 39,256 | 91,107 | 190,602 | 364,112 | 581,653 | |||||||||||||
| Total Loans | $ | 6,451,217 | $ | 5,925,029 | $ | 5,905,884 | $ | 5,437,049 | $ | 5,661,492 | ||||||||
| AVERAGE BALANCES, INTEREST INCOME AND EXPENSES, YIELDS AND RATES 1 | (Unaudited) | |||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | ||
| SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES | ||||||||||||||||||
| 1Q'22 | 4Q'21 | 1Q'21 | ||||||||||||||||
| Average | Yield/ | Average | Yield/ | Average | Yield/ | |||||||||||||
| (Amounts in thousands) | Balance | Interest | Rate | Balance | Interest | Rate | Balance | Interest | Rate | |||||||||
| Assets | ||||||||||||||||||
| Earning assets: | ||||||||||||||||||
| Securities: | ||||||||||||||||||
| Taxable | $ | 2,406,399 | $ | 10,041 | 1.67 | % | $ | 2,198,517 | $ | 8,574 | 1.56 | % | $ | 1,550,457 | $ | 6,298 | 1.62 | % |
| Nontaxable | 24,042 | 177 | 2.94 | 24,664 | 176 | 2.85 | 25,932 | 187 | 2.89 | |||||||||
| Total Securities | 2,430,441 | 10,218 | 1.68 | 2,223,181 | 8,750 | 1.57 | 1,576,389 | 6,485 | 1.65 | |||||||||
| Federal funds sold | 738,588 | 350 | 0.19 | 878,875 | 337 | 0.15 | 293,506 | 74 | 0.10 | |||||||||
| Other investments | 44,999 | 583 | 5.25 | 34,992 | 491 | 5.57 | 83,838 | 512 | 2.48 | |||||||||
| Loans excluding PPP loans | 6,276,964 | 65,675 | 4.24 | 5,804,149 | 61,135 | 4.18 | 5,149,642 | 55,504 | 4.37 | |||||||||
| PPP loans | 61,923 | 1,523 | 9.98 | 136,942 | 3,352 | 9.71 | 609,733 | 6,886 | 4.58 | |||||||||
| Total Loans | 6,338,887 | 67,198 | 4.30 | 5,941,091 | 64,487 | 4.31 | 5,759,375 | 62,390 | 4.39 | |||||||||
| Total Earning Assets | 9,552,915 | 78,349 | 3.33 | 9,078,139 | 74,065 | 3.24 | 7,713,108 | 69,461 | 3.65 | |||||||||
| Allowance for credit losses | (87,467) | (88,484) | (91,735) | |||||||||||||||
| Cash and due from banks | 365,835 | 359,287 | 255,685 | |||||||||||||||
| Premises and equipment | 75,876 | 72,148 | 74,272 | |||||||||||||||
| Intangible assets | 304,321 | 267,692 | 237,323 | |||||||||||||||
| Bank owned life insurance | 205,500 | 195,169 | 132,079 | |||||||||||||||
| Other assets | 211,536 | 177,431 | 164,622 | |||||||||||||||
| Total Assets | $ | 10,628,516 | $ | 10,061,382 | $ | 8,485,354 | ||||||||||||
| Liabilities and Shareholders' Equity | ||||||||||||||||||
| Interest-bearing liabilities: | ||||||||||||||||||
| Interest-bearing demand | $ | 2,097,383 | $ | 190 | 0.04 | % | $ | 1,960,083 | $ | 183 | 0.04 | % | $ | 1,600,490 | $ | 258 | 0.07 | % |
| Savings | 925,348 | 65 | 0.03 | 866,257 | 63 | 0.03 | 722,274 | 137 | 0.08 | |||||||||
| Money market | 1,976,660 | 512 | 0.11 | 1,851,275 | 465 | 0.10 | 1,609,938 | 670 | 0.17 | |||||||||
| Time deposits | 560,681 | 468 | 0.34 | 595,230 | 494 | 0.33 | 711,320 | 1,187 | 0.68 | |||||||||
| Securities sold under agreements to repurchase | 118,146 | 39 | 0.13 | 106,691 | 30 | 0.11 | 112,834 | 41 | 0.15 | |||||||||
| Other borrowings | 71,670 | 436 | 2.47 | 71,600 | 418 | 2.32 | 71,390 | 427 | 2.43 | |||||||||
| Total Interest-Bearing Liabilities | 5,749,888 | 1,710 | 0.12 | 5,451,136 | 1,653 | 0.12 | 4,828,246 | 2,720 | 0.23 | |||||||||
| Noninterest demand | 3,336,121 | 3,179,798 | 2,432,038 | |||||||||||||||
| Other liabilities | 141,972 | 126,762 | 88,654 | |||||||||||||||
| Total Liabilities | 9,227,981 | 8,757,696 | 7,348,938 | |||||||||||||||
| Shareholders' equity | 1,400,535 | 1,303,686 | 1,136,416 | |||||||||||||||
| Total Liabilities & Equity | $ | 10,628,516 | $ | 10,061,382 | $ | 8,485,354 | ||||||||||||
| Cost of deposits | 0.06 | % | 0.06 | % | 0.13 | % | ||||||||||||
| Interest expense as a % of earning assets | 0.07 | % | 0.07 | % | 0.14 | % | ||||||||||||
| Net interest income as a % of earning assets | $ | 76,639 | 3.25 | % | $ | 72,412 | 3.16 | % | $ | 66,741 | 3.51 | % | ||||||
| 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 | ||||||||||||||||||
| March 31, | December 31, | September 30, | June 30, | March 31, | ||||||||||||||
| (Amounts in thousands) | 2022 | 2021 | 2021 | 2021 | 2021 | |||||||||||||
| Customer Relationship Funding | ||||||||||||||||||
| Noninterest demand | ||||||||||||||||||
| Commercial | $ | 2,939,595 | $ | 2,477,111 | $ | 2,535,922 | $ | 2,431,928 | $ | 2,189,564 | ||||||||
| Retail | 458,809 | 458,626 | 416,779 | 401,988 | 379,257 | |||||||||||||
| Public funds | 86,419 | 107,523 | 84,337 | 88,057 | 83,315 | |||||||||||||
| Other | 37,877 | 32,274 | 49,428 | 30,187 | 33,111 | |||||||||||||
| Total Noninterest Demand | 3,522,700 | 3,075,534 | 3,086,466 | 2,952,160 | 2,685,247 | |||||||||||||
| Interest-bearing demand | ||||||||||||||||||
| Commercial | 610,109 | 497,466 | 554,366 | 545,797 | 497,047 | |||||||||||||
| Retail | 1,392,490 | 1,144,635 | 1,069,668 | 958,619 | 895,853 | |||||||||||||
| Public funds | 250,963 | 248,111 | 221,131 | 259,468 | 255,035 | |||||||||||||
| Total Interest-Bearing Demand | 2,253,562 | 1,890,212 | 1,845,165 | 1,763,884 | 1,647,935 | |||||||||||||
| Total transaction accounts | ||||||||||||||||||
| Commercial | 3,549,704 | 2,974,577 | 3,090,288 | 2,977,725 | 2,686,611 | |||||||||||||
| Retail | 1,851,299 | 1,603,261 | 1,486,447 | 1,360,607 | 1,275,110 | |||||||||||||
| Public funds | 337,382 | 355,634 | 305,468 | 347,525 | 338,350 | |||||||||||||
| Other | 37,877 | 32,274 | 49,428 | 30,187 | 33,111 | |||||||||||||
| Total Transaction Accounts | 5,776,262 | 4,965,746 | 4,931,631 | 4,716,044 | 4,333,182 | |||||||||||||
| Savings | 937,839 | 895,019 | 834,309 | 811,516 | 768,362 | |||||||||||||
| Money market | ||||||||||||||||||
| Commercial | 856,117 | 732,639 | 827,901 | 787,894 | 692,537 | |||||||||||||
| Retail | 931,702 | 840,054 | 834,628 | 737,554 | 701,453 | |||||||||||||
| Brokered | 126,168 | 8,007 | 196,548 | 187,023 | 197,389 | |||||||||||||
| Public funds | 85,040 | 71,181 | 92,562 | 94,719 | 79,800 | |||||||||||||
| Total Money Market | 1,999,027 | 1,651,881 | 1,951,639 | 1,807,190 | 1,671,179 | |||||||||||||
| Brokered time certificates | — | — | 20,000 | 20,000 | 93,500 | |||||||||||||
| Other time certificates | 530,640 | 554,943 | 596,593 | 481,686 | 519,526 | |||||||||||||
| 530,640 | 554,943 | 616,593 | 501,686 | 613,026 | ||||||||||||||
| Total Deposits | $ | 9,243,768 | $ | 8,067,589 | $ | 8,334,172 | $ | 7,836,436 | $ | 7,385,749 | ||||||||
| Customer sweep accounts | $ | 120,922 | $ | 121,565 | $ | 105,548 | $ | 119,973 | $ | 109,171 |
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 | |||||||||||||||
| (Amounts in thousands, except per share data) | 1Q'22 | 4Q'21 | 3Q'21 | 2Q'21 | 1Q'21 | ||||||||||
| Net Income | $ | 20,588 | $ | 36,330 | $ | 22,944 | $ | 31,410 | $ | 33,719 | |||||
| Total noninterest income | 15,373 | 18,706 | 19,028 | 15,322 | 17,671 | ||||||||||
| Securities losses (gains), net | 452 | 379 | 30 | 55 | 114 | ||||||||||
| Gain on sale of domain name (included in other income) | — | (755) | — | — | — | ||||||||||
| Total Adjustments to Noninterest Income | 452 | (376) | 30 | 55 | 114 | ||||||||||
| Total Adjusted Noninterest Income | 15,825 | 18,330 | 19,058 | 15,377 | 17,785 | ||||||||||
| Total noninterest expense | 58,917 | 50,263 | 55,268 | 45,784 | 46,120 | ||||||||||
| Merger related charges | (6,692) | (482) | (6,281) | (509) | (581) | ||||||||||
| Amortization of intangibles | (1,446) | (1,304) | (1,306) | (1,212) | (1,211) | ||||||||||
| Branch reductions and other expense initiatives | (74) | (168) | (870) | (663) | (449) | ||||||||||
| Total Adjustments to Noninterest Expense | (8,212) | (1,954) | (8,457) | (2,384) | (2,241) | ||||||||||
| Total Adjusted Noninterest Expense | 50,705 | 48,309 | 46,811 | 43,400 | 43,879 | ||||||||||
| Income Taxes | 5,834 | 8,344 | 7,049 | 8,785 | 10,157 | ||||||||||
| Tax effect of adjustments | 2,196 | 280 | 2,081 | 598 | 577 | ||||||||||
| Effect of change in corporate tax rate on deferred tax assets | — | 774 | — | — | — | ||||||||||
| Total Adjustments to Income Taxes | 2,196 | 1,054 | 2,081 | 598 | 577 | ||||||||||
| Adjusted Income Taxes | 8,030 | 9,398 | 9,130 | 9,383 | 10,734 | ||||||||||
| Adjusted Net Income | $ | 27,056 | $ | 36,854 | $ | 29,350 | $ | 33,251 | $ | 35,497 | |||||
| Earnings per diluted share, as reported | $ | 0.33 | $ | 0.62 | $ | 0.40 | $ | 0.56 | $ | 0.60 | |||||
| Adjusted Earnings per Diluted Share | 0.44 | 0.62 | 0.51 | 0.59 | 0.63 | ||||||||||
| Average diluted shares outstanding | 61,704 | 59,016 | 57,645 | 55,901 | 55,992 | ||||||||||
| Adjusted Noninterest Expense | $ | 50,705 | $ | 48,309 | $ | 46,811 | $ | 43,400 | $ | 43,879 | |||||
| Provision for credit losses on unfunded commitments | (142) | — | (133) | — | — | ||||||||||
| Foreclosed property expense and net gain / (loss) on sale | 164 | 175 | (66) | 90 | 65 | ||||||||||
| Net Adjusted Noninterest Expense | $ | 50,727 | $ | 48,484 | $ | 46,612 | $ | 43,490 | $ | 43,944 | |||||
| Revenue | $ | 91,895 | $ | 90,995 | $ | 90,352 | $ | 81,124 | $ | 84,281 | |||||
| Total Adjustments to Revenue | 452 | (376) | 30 | 55 | 114 | ||||||||||
| Impact of FTE adjustment | 117 | 123 | 131 | 131 | 131 | ||||||||||
| Adjusted Revenue on a fully taxable equivalent basis | $ | 92,464 | $ | 90,742 | $ | 90,513 | $ | 81,310 | $ | 84,526 | |||||
| Adjusted Efficiency Ratio | 54.86 | % | 53.43 | % | 51.50 | % | 53.49 | % | 51.99 | % | |||||
| Net Interest Income | $ | 76,522 | $ | 72,289 | $ | 71,324 | $ | 65,802 | $ | 66,610 | |||||
| Impact of FTE adjustment | 117 | 123 | 131 | 131 | 131 | ||||||||||
| Net Interest Income including FTE adjustment | $ | 76,639 | $ | 72,412 | $ | 71,455 | $ | 65,933 | $ | 66,741 | |||||
| Total noninterest income | 15,373 | 18,706 | 19,028 | 15,322 | 17,671 | ||||||||||
| Total noninterest expense | 58,917 | 50,263 | 55,268 | 45,784 | 46,120 | ||||||||||
| Pre-Tax Pre-Provision Earnings | $ | 33,095 | $ | 40,855 | $ | 35,215 | $ | 35,471 | $ | 38,292 | |||||
| Total Adjustments to Noninterest Income | 452 | (376) | 30 | 55 | 114 | ||||||||||
| Total Adjustments to Noninterest Expense | (8,190) | (1,779) | (8,656) | (2,294) | (2,176) | ||||||||||
| Adjusted Pre-Tax Pre-Provision Earnings | $ | 41,737 | $ | 42,258 | $ | 43,901 | $ | 37,820 | $ | 40,582 | |||||
| Average Assets | $ | 10,628,516 | $ | 10,061,382 | $ | 9,753,734 | $ | 9,025,846 | $ | 8,485,354 | |||||
| Less average goodwill and intangible assets | (304,321) | (267,692) | (254,980) | (235,964) | (237,323) | ||||||||||
| Average Tangible Assets | $ | 10,324,195 | $ | 9,793,690 | $ | 9,498,754 | $ | 8,789,882 | $ | 8,248,031 | |||||
| Return on Average Assets (ROA) | 0.79 | % | 1.43 | % | 0.93 | % | 1.40 | % | 1.61 | % | |||||
| Impact of removing average intangible assets and related amortization | 0.06 | 0.08 | 0.07 | 0.08 | 0.09 | ||||||||||
| Return on Average Tangible Assets (ROTA) | 0.85 | 1.51 | 1.00 | 1.48 | 1.70 | ||||||||||
| Impact of other adjustments for Adjusted Net Income | 0.21 | (0.02) | 0.23 | 0.04 | 0.05 | ||||||||||
| Adjusted Return on Average Tangible Assets | 1.06 | 1.49 | 1.23 | 1.52 | 1.75 | ||||||||||
| GAAP TO NON-GAAP RECONCILIATION | (Unaudited) | ||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES | |||||||||||||||
| Quarterly Trends | |||||||||||||||
| (Amounts in thousands, except per share data) | 1Q'22 | 4Q'21 | 3Q'21 | 2Q'21 | 1Q'21 | ||||||||||
| Average Shareholders' Equity | $ | 1,400,535 | $ | 1,303,686 | $ | 1,248,547 | $ | 1,170,395 | $ | 1,136,416 | |||||
| Less average goodwill and intangible assets | (304,321) | (267,692) | (254,980) | (235,964) | (237,323) | ||||||||||
| Average Tangible Equity | $ | 1,096,214 | $ | 1,035,994 | $ | 993,567 | $ | 934,431 | $ | 899,093 | |||||
| Return on Average Shareholders' Equity | 5.96 | % | 11.06 | % | 7.29 | % | 10.76 | % | 12.03 | % | |||||
| Impact of removing average intangible assets and related amortization | 2.06 | 3.23 | 2.27 | 3.12 | 3.59 | ||||||||||
| Return on Average Tangible Common Equity (ROTCE) | 8.02 | 14.29 | 9.56 | 13.88 | 15.62 | ||||||||||
| Impact of other adjustments for Adjusted Net Income | 1.99 | (0.18) | 2.16 | 0.39 | 0.39 | ||||||||||
| Adjusted Return on Average Tangible Common Equity | 10.01 | 14.11 | 11.72 | 14.27 | 16.01 | ||||||||||
| Loan interest income1 | $ | 67,198 | $ | 64,487 | $ | 64,517 | $ | 60,440 | $ | 62,390 | |||||
| Accretion on acquired loans | (3,717) | (3,520) | (3,483) | (2,886) | (2,868) | ||||||||||
| Interest and fees on PPP loans | (1,523) | (3,352) | (5,917) | (5,127) | (6,886) | ||||||||||
| Loan interest income excluding PPP and accretion on acquired loans | $ | 61,958 | $ | 57,615 | $ | 55,117 | $ | 52,427 | $ | 52,636 | |||||
| Yield on loans1 | 4.30 | 4.31 | 4.49 | 4.33 | 4.39 | ||||||||||
| Impact of accretion on acquired loans | (0.24) | (0.24) | (0.24) | (0.21) | (0.20) | ||||||||||
| Impact of PPP loans | (0.06) | (0.13) | (0.22) | 0.01 | (0.04) | ||||||||||
| Yield on loans excluding PPP and accretion on acquired loans | 4.00 | % | 3.94 | % | 4.03 | % | 4.13 | % | 4.15 | % | |||||
| Net Interest Income1 | $ | 76,639 | $ | 72,412 | $ | 71,455 | $ | 65,933 | $ | 66,741 | |||||
| Accretion on acquired loans | (3,717) | (3,520) | (3,483) | (2,886) | (2,868) | ||||||||||
| Interest and fees on PPP loans | (1,523) | (3,352) | (5,917) | (5,127) | (6,886) | ||||||||||
| Net interest income excluding PPP and accretion on acquired loans | $ | 71,399 | $ | 65,540 | $ | 62,055 | $ | 57,920 | $ | 56,987 | |||||
| Net Interest Margin | 3.25 | 3.16 | 3.22 | 3.23 | 3.51 | ||||||||||
| Impact of accretion on acquired loans | (0.15) | (0.15) | (0.15) | (0.14) | (0.15) | ||||||||||
| Impact of PPP loans | (0.05) | (0.10) | (0.18) | (0.06) | (0.11) | ||||||||||
| Net interest margin excluding PPP and accretion on acquired loans | 3.05 | % | 2.91 | % | 2.89 | % | 3.03 | % | 3.25 | % | |||||
| Security interest income1 | $ | 10,218 | $ | 8,750 | $ | 7,956 | $ | 6,745 | $ | 6,485 | |||||
| Tax equivalent adjustment on securities | (37) | (37) | (38) | (39) | (39) | ||||||||||
| Security interest income excluding tax equivalent adjustment | $ | 10,181 | $ | 8,713 | $ | 7,918 | $ | 6,706 | $ | 6,446 | |||||
| Loan interest income1 | $ | 67,198 | $ | 64,487 | $ | 64,517 | $ | 60,440 | $ | 62,390 | |||||
| Tax equivalent adjustment on loans | (80) | (86) | (93) | (92) | (92) | ||||||||||
| Loan interest income excluding tax equivalent adjustment | $ | 67,118 | $ | 64,401 | $ | 64,424 | $ | 60,348 | $ | 62,298 | |||||
| Net Interest Income1 | $ | 76,639 | $ | 72,412 | $ | 71,455 | $ | 65,933 | $ | 66,741 | |||||
| Tax equivalent adjustment on securities | (37) | (37) | (38) | (39) | (39) | ||||||||||
| Tax equivalent adjustment on loans | (80) | (86) | (93) | (92) | (92) | ||||||||||
| Net interest income excluding tax equivalent adjustment | $ | 76,522 | $ | 72,289 | $ | 71,324 | $ | 65,802 | $ | 66,610 | |||||
| 1On a fully taxable equivalent basis. All yields and rates have been computed using amortized cost. |
sbcf1q2022earningspresen
EARNINGS PRESENTATION FIRST QUARTER 2022 2022
2FIRST QUARTER 2022 EARNINGS PRESENTATION This presentation 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 Apollo Bancshares, Inc., 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 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; the adverse impact of COVID-19 (economic and otherwise) on the Company and its customers, counterparties, employees, and third-party service providers, and the adverse impacts to our business, financial position, results of operations and prospects; 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; 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 including as a result of the financial impact of COVID-19; changes in retail distribution strategies, customer preferences and behavior (including as a result of economic factors); 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 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, successfully acquire and integrate desirable financial institutions and realize expected revenues and revenue synergies; 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, including the impact of supply chain disruptions; reduction in or the termination of Seacoast’s ability to use the online- or mobile-based platform that is critical to the Company’s business growth strategy; the effects of war or other conflicts including the impacts related to or resulting from Russia’s military action in Ukraine, 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 Paycheck Protection Program (“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 credit losses. The risks relating to the proposed Apollo Bancshares, Inc. merger include, without limitation, failure to obtain the approval of shareholders of Apollo Bancshares, Inc. and Apollo Bank in connection with the merger; the timing to consummate the proposed merger; the risk that a condition to the closing of the proposed merger may not be satisfied; the risk that a regulatory approval that may be required for the proposed merger is not obtained or is obtained subject to conditions that are not anticipated; the parties' ability to achieve the synergies and value creation contemplated by the proposed merger; the parties' ability to promptly and effectively integrate the businesses of Seacoast and Apollo Bancshares, Inc., including unexpected transaction costs, the costs of integrating operations, severance, professional fees and other expenses; the diversion of management time on issues related to the merger; the failure to consummate or any delay in consummating the merger for other reasons; changes in laws or regulations; the risks of customer and employee loss and business disruption, including, without limitation, as the result of difficulties in maintaining relationships with employees; increased competitive pressures and solicitations of customers and employees by competitors; and the difficulties and risks inherent with entering new markets. 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, 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. Cautionary Notice Regarding Forward-Looking Statements
3FIRST QUARTER 2022 EARNINGS PRESENTATION • $10.9 billion in assets as of March 31, 2022, operating in the nation’s third- most populous state • Strong presence in Florida’s most attractive markets ▪ #1 Florida-based bank in Orlando MSA ▪ #1 market share in Port Saint Lucie MSA ▪ #2 Florida-based bank in West Palm Beach/Fort Lauderdale ▪ #2 Florida-based bank in St. Petersburg • Among the largest publicly traded community banks headquartered in Florida • Market Cap: $2.1 billion as of March 31, 2022 • Highly disciplined credit portfolio • Strong liquidity position • Prudent capital position to support further organic growth and opportunistic acquisitions • Unique customer analytics capabilities drive value creation with new, acquired, and existing customers Jacksonville MSA West Palm Beach Fort Lauderdale Miami MSA Port St. Lucie MSA Orlando MSA Tampa St. Petersburg MSA Naples Fort Myers MSA Valuable Florida Franchise, Well-Positioned for Growth with Strong Capital, Liquidity and Disciplined Credit Culture SEACOAST BANK FOOTPRINT
4FIRST QUARTER 2022 EARNINGS PRESENTATION Attracted by Florida’s favorable business climate, lower taxes, warmer weather and easy flights to the Northeast, record numbers of individuals and companies have completed or announced plans to relocate operations to Florida. Sources: US Census data; The Florida Legislature Office of Economic & Demographic Research Florida’s Economic Growth Continues More Northeast-based Businesses Look To Put Down Roots In South Florida Businesses Are Flocking to Florida Jacksonville’s Economic Growth Surpasses City’s Expectations New Business Financing Strategies Emerge As South Florida Becomes “Silicon Valley East” Tech Jobs, Sun, And No Income Tax: Experts Explain Why Florida Is Poised To Keep Growing Even After The Pandemic Pandemic Turns Florida's West Palm Beach Into Office Boomtown Collier County Continues To Grow And Develop. There’s No Stopping It. The number of Floridians, making Florida the third most populous state in the nation 21.7 M Between 2010 and 2020, Florida’s population grew at twice the rate of overall U.S. population growth 14.6% Florida’s population growth in 2020, the equivalent of adding a city the size of Orlando 360,000 Florida was the top state for net in-migration for the fifth consecutive year #1
5FIRST QUARTER 2022 EARNINGS PRESENTATION • Net interest margin expanded nine basis points to 3.25%. Excluding the effect of PPP and accretion on acquired loans, net interest margin expanded 14 basis points to 3.05%. • Asset sensitive balance sheet and ample liquidity support the opportunity for continued expansion of NIM in future periods. • Yield on securities expanded 11 basis points to 1.68% and yield on non-PPP loans expanded six basis points to 4.24%. • Cost of deposits remained flat at six basis points. • Investment in commercial banking talent over the prior year supported disciplined organic loan growth of 7% on an annualized basis. • Commercial loan originations increased 83% from the first quarter of 2021 to $373 million. The late stage pipeline exiting the quarter is $620 million, setting the stage for continued growth in the coming quarter. • Continued strong asset quality trends, with nonperforming loans declining to 0.41% of total loans. $5.1 million of provision build upon closing of two acquisitions. • Strong deposit growth, with organic deposits increasing 25% on an annualized basis. • Building long-term shareholder value through long-term growth in tangible book value per share, ending the period at $17.12, an increase of 3% over the prior year. Excluding the decrease in fair value of AFS debt securities, tangible book value per share would have been $18.19, or an increase of 9% year-over-year. • Established market presence in Naples, Sarasota, and Jacksonville, and announced the upcoming acquisition of Apollo Bancshares, Inc., which brings five locations in Miami- Dade County. This expansion across some of the best banking markets in the United States will lead to strong franchise value creation in the coming years. • Increased quarterly dividend from $0.13 to $0.17 given balance sheet strength and continued strong outlook for capital generation. First Quarter 2022 Highlights
6FIRST QUARTER 2022 EARNINGS PRESENTATION Net Interest Income and Margin ($ in th ou sa nd s) $66,741 $65,933 $71,455 $72,412 $76,639 3.51% 3.23% 3.22% 3.16% 3.25% 3.25% 3.03% 2.89% 2.91% 3.05% Net Interest Income Net Interest Margin NIM, excluding PPP and accretion on acquired loans 1Q'21 2Q'21 3Q'21 4Q'21 1Q'22 • Net interest income1 totaled $76.6 million, an increase of $4.2 million, or 6%, from the prior quarter. • Net interest margin expanded nine basis points to 3.25% and, excluding the effect of PPP and accretion on acquired loans, net interest margin increased 14 basis points to 3.05%. • Securities yields expanded eleven basis points to 1.68%, reflecting the addition of higher yielding securities during the quarter. Non-PPP loan yields expanded six basis points to 4.24%, benefiting from $678.7 million in loan originations during the first quarter of 2022. • Cost of deposits remained flat quarter-over-quarter at six basis points. 1Calculated on a fully taxable equivalent basis using amortized cost.
7FIRST QUARTER 2022 EARNINGS PRESENTATION $17,785 $18,330 $15,825 $2,338 $2,606 $2,801 $3,820 $4,135 $4,128 $2,323 $2,356 $2,659 $4,225 $2,030 $1,686 $4,220 $5,908 $3,217 $859 $1,295 $1,334 Service Charges Interchange Income Wealth Management Mortgage Banking Other Income BOLI 1Q'21 4Q'21 1Q'22 $17,671 $18,706 $15,373 $2,338 $2,606 $2,801 $3,820 $4,135 $4,128 $2,323 $2,356 $2,659 $4,225 $2,030 $1,686 $4,106 $6,284 $2,765 $859 $1,295 $1,334 Service Charges Interchange Income Wealth Management Mortgage Banking Other Income BOLI 1Q'21 4Q'21 1Q'22 Adjusted Noninterest Income1 ($ in thousands) 2 3 Noninterest Income ($ in thousands) 1Non-GAAP measure, see “Explanation of Certain Unaudited Non-GAAP Financial Measures" for more information and a reconciliation to GAAP. 2Other Income includes income and gains on SBIC investments, SBA gains, marine finance fees, a gain on the sale of a website domain name obtained in a prior bank acquisition, and other fees related to customer activity as well as securities losses of $55 thousand in 1Q’21, $379 thousand in 4Q'21 and $452 thousand in 1Q'22. 3Other Income on an adjusted basis includes income and gains on SBIC investments, SBA gains, marine finance fees, and other fees related to customer activity. Continued Strength in Noninterest Income Noninterest income declined $3.3 million from the prior quarter to $15.4 million, and adjusted noninterest income1 declined $2.5 million to $15.8 million. Changes on an adjusted basis include: • Wealth management income was $2.7 million in the first quarter, an increase of $0.3 million compared to the prior quarter, reflecting continued success at winning new relationships. • Mortgage banking fees were $1.7 million, compared to $2.0 million in the prior quarter, the result of lower saleable production due to low housing inventory and slowing refinance demand. • Other income decreased by $2.7 million in the first quarter of 2022, reflecting lower income on SBIC investments and the fourth quarter of 2021 gain on sale of a website domain name, partially offset by higher loan swap-related income.
8FIRST QUARTER 2022 EARNINGS PRESENTATION $43,879 $48,309 $50,705 $26,303 $29,766 $30,671 $4,468 $5,157 $5,524$5,468 $5,546 $6,070 $1,997 $2,049 $1,899 $5,643 $5,791 $6,541 Other Expense Legal & Professional Occupancy & Telephone Data Processing Cost Salaries & Benefits 1Q'21 4Q'21 1Q'22 $46,120 $50,263 $58,917 $26,373 $29,768 $33,720 $1,211 $1,304 $1,446 $4,468 $5,165 $6,156 $5,828 $5,693 $6,145 $2,582 $2,461 $4,789 $5,658 $5,872 $6,661 Other Expense Legal & Professional Occupancy & Telephone Data Processing Cost Amortization of Intangibles Salaries & Benefits 1Q'21 4Q'21 1Q'22 Adjusted Noninterest Expense1 ($ in thousands) 2 2 Noninterest Expense ($ in thousands) Noninterest expense increased $8.7 million, which includes a $6.2 million increase in merger-related expenses, and adjusted noninterest expense1 increased $2.4 million sequentially. Changes quarter-over-quarter on an adjusted basis include: • Salaries and benefits increased $0.9 million, primarily reflecting the impact of higher seasonal payroll taxes and 401(k) contributions and an expanded footprint. • Data processing costs increased by $0.4 million, which includes expenses incurred for the launch of the Company’s enhanced online and mobile banking platform in the first quarter of 2022. • Occupancy and telephone increased by $0.5 million, reflecting our expansion into the Naples, Sarasota, and Jacksonville markets. 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. Continued Focus on Disciplined Expense Control
9FIRST QUARTER 2022 EARNINGS PRESENTATION Efficiency Ratio Trend 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 57% 53% 49% 48% 60% 50% 62% 48% 53% 55% 60% 54% 62% 1Q '19 2Q '19 3Q '19 4Q '19 1Q '20 2Q '20 3Q '20 4Q '20 1Q '21 2Q '21 3Q '21 4Q '21 1Q '22 56% 51% 49% 48% 54% 50% 55% 49% 52% 53% 51% 53% 55% 1Q '19 2Q '19 3Q '19 4Q '19 1Q '20 2Q '20 3Q '20 4Q '20 1Q '21 2Q '21 3Q '21 4Q '21 1Q '22 GAAP - Efficiency Adjusted - Efficiency1 • The efficiency ratio was 62.3% for the first quarter of 2022 compared to 53.7% in the prior quarter and 53.2% in the first quarter of 2021. Increases in the first quarter of 2022 reflect higher expenses from the acquisitions of BBFC and Sabal Palm. • The adjusted efficiency ratio1 was 54.9% for the first quarter of 2022 compared to 53.4% in the prior quarter and 52.0% in the first quarter of 2021. 1Non-GAAP measure, see “Explanation of Certain Unaudited Non-GAAP Financial Measures" for more information and a reconciliation to GAAP. First Bank of the Palm Beaches Freedom Bank Legacy Bank of Florida Sabal Palm Bank and Florida Business Bank
10FIRST QUARTER 2022 EARNINGS PRESENTATION Building Florida’s Leading Commercial Bank $100 $200 $300 $400 $500 $600 Ron York joins as Treasury Management Executive Previously with First Horizon Chris Rolle joins as West FL Regional Market President, formerly Director of Middle Market Banking at Synovus and Central FL Market President at BB&T Dan Hilken joins as Central FL Regional Market President with a 30-year career, most recently with Wells Fargo Austen Carroll joins as Chief Lending Officer Previously Chief Banking Officer at Ameris James Norton joins as CRE Director, formerly Executive Director of Real Estate Banking at JPMorgan Chase Brannon Fitch formerly of BB&T, joins as Northeast FL Market President leading strategic geographic expansion Growth continues in Central FL Four bankers join in Orlando and Lakeland (JPMorgan Chase, Regions, TD Bank, Wells Fargo) South Florida expansion continues Six bankers join in Palm Beach and Broward counties (TD Bank and Legacy Bank) James Stallings joins as Chief Credit Officer after almost 25 years with BB&T 4Q 20203Q 2020 1Q 2021 2Q 2021 3Q 2021 1Q 20224Q 2021 West and North Florida expansion continues 14 bankers join YTD in Jacksonville, Naples, St. Petersburg TOTAL COMMERCIAL PIPELINE OF $620MM In the first quarter of 2022, Seacoast expanded the footprint in Naples/Southwest Florida and Jacksonville/Northeast Florida with key additions to our commercial banking leadership and the addition of 14 experienced bankers in the state’s most dynamic and fastest growing markets. Co m m er ci al P ip el in e ($ in m ill io ns )
11FIRST QUARTER 2022 EARNINGS PRESENTATION Commercial Real Estate - Owner Occupied $1,284,515 20% Construction and Land Development $259,421 4% Paycheck Protection Program $39,256 1% Consumer $169,724 3% Commercial & Financial $1,132,506 17% Commercial Real Estate - Non-Owner Occupied $1,966,150 30% Residential Real Estate $1,599,645 25% At March 31, 2022 ($ in thousands) Seacoast's Lending Strategy Produced and Sustains a Diverse Loan Portfolio The Company remains focused and committed to its strict credit underwriting standards. Construction and land development and commercial real estate loans, as defined in regulatory guidance, represent 20% and 172%, 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. Seacoast’s average commercial loan size is $524 thousand.
12FIRST QUARTER 2022 EARNINGS PRESENTATION $5,661 $5,437 $5,906 $5,925 $6,451 $5,079 $5,073 $5,715 $5,834 $582 $364 $191 $91 4.39% 4.33% 4.49% 4.31% 4.30% 4.15% 4.13% 4.03% 3.94% 4.00% Yield Excluding PPP and Accretion on Acquired Loans Reported Yield PPP Loans Loans Excluding PPP 1Q'21 2Q'21 3Q'21 4Q'21 1Q'22 Total Loans Outstanding ($ in millions) Disciplined Approach to Lending in an Expanding Florida Economy Loans outstanding, excluding PPP and excluding the impact of acquired banks and purchases, increased $104 million, or 7% annualized. Total loan originations were $678.7 million, and the commercial pipeline increased 56% to a record $619.5 million. Loan yields excluding PPP and accretion on acquired loans expanded to 4.00% from 3.94%. Growth occurred across all loan types, building diversity in the portfolio. 1Total loans outstanding as of 1Q’22 includes $39 million in PPP loans. 1
13FIRST QUARTER 2022 EARNINGS PRESENTATION Investment Securities Performance and Composition Unrealized Gain (Loss) in Securities as of March 31, 2022 (in thousands) Amortized Cost Fair Value Net Unrealized Gain (Loss) Δ from 4Q’21 Available for Sale Government backed $ 6,240 $ 6,281 $ 41 $ (272) Agency mortgage backed 1,335,336 1,244,670 (90,666) (78,665) Private label MBS and CMOs 114,286 111,296 (2,990) (3,661) CLO 315,168 313,124 (2,044) (1,983) Municipal 31,533 31,248 (285) (2,024) Total Available for Sale $ 1,802,563 $ 1,706,619 $ (95,944) $ (86,605) Held to Maturity Agency mortgage backed $ 747,004 $ 709,492 $ (37,512) (26,270) Total Held to Maturity $ 747,004 $ 709,492 $ (37,512) $ (26,270) Total Securities $ 2,549,567 $ 2,416,111 $ (133,456) $ (112,875) ($ in m ill io ns ) $512 $493 $527 $639 $747 $1,051 $1,323 $1,546 $1,644 $1,707 1.65% 1.63% 1.59% 1.57% 1.68% HTM Securities AFS Securities Yield 1Q'21 2Q'21 3Q'21 4Q'21 1Q'22 • Portfolio yield increased 11 basis points to 1.68% from 1.57% in the prior quarter. • AFS securities ended the quarter with a net unrealized loss of $95.9 million compared to an unrealized loss of $9.3 million at December 31, 2021, largely due to the rise in short and medium term interest rates during the first quarter. • High quality portfolio consisting of 82% agency backed, with the remainder being high quality investment grade bonds. CLO portfolio is 61% AAA and 39% AA. • AFS portfolio duration of 3.19. • Portfolio yield increased 11 basis points to 1.68% from 1.57% in the prior quarter. • AFS securities ended the quarter with a net unrealized loss of $95.9 million compared to an unrealized loss of $9.3 million at December 31, 2021, largely due to the rise in short and medium term interest rates during the first quarter. • High quality portfolio consisting of 82% agency backed, with the remainder being high quality investment grade bonds. CLO portfolio is 61% AAA and 39% AA. • AFS portfolio duration of 3.19.
14FIRST QUARTER 2022 EARNINGS PRESENTATION $ in m ill io ns $1,478 $1,727 $1,804 $1,987 $2,543 $3,265 $3,300 $3,021 $3,676 $1,163 $1,203 $1,494 $1,583 $1,564 $1,816 $2,073 $2,283 $2,454 $315 $524 $310 $404 $979 $1,449 $1,228 $738 $1,223 Securities Cash and cash equivalents 1Q'20 2Q'20 3Q'20 4Q'20 1Q'21 2Q'21 3Q'21 4Q'21 1Q'22 $— $500 $1,000 $1,500 $2,000 $2,500 $3,000 $3,500 $4,000 Strong Liquidity Position Available to Leverage at Higher Rates
15FIRST QUARTER 2022 EARNINGS PRESENTATION Low Historical Deposit Beta Coupled with Favorable Deposit Composition 0.25% 0.29% 0.50% 0.50% 0.50% 0.55% 1.00% 1.04% 1.25% 1.30% 1.53% 1.80% 2.01% 2.28% 2.50% 2.50% 0.13% 0.12% 0.13% 0.10% 0.15% 0.14% 0.14% 0.17% 0.22% 0.29% 0.33% 0.39% 0.43% 0.54% 0.67% 0.76% Fed Funds Rate Cost of Deposits 3Q’15 4Q’15 1Q’16 2Q’16 3Q’16 4Q’16 1Q’17 2Q’17 3Q’17 4Q’17 1Q’18 2Q’18 3Q’18 4Q’18 1Q’19 2Q’19 —% 0.50% 1.00% 1.50% 2.00% 2.50% 3.00% 31.7% 38.1% 10.5% 10.1% 11.2% 5.7% 22.5% 24.4% 24.1% 21.6% Noninterest demand Savings Time Deposits Interest-bearing demand Money Market 09/30/15 03/31/22 1Beta is calculated as the change in deposit costs divided by the change in Fed Funds Rate Total 3Q15 to 2Q19 Deposit Beta1 equal to 28% Favorable deposit composition compared to prior start of rate cycle. Deposit Mix
16FIRST QUARTER 2022 EARNINGS PRESENTATION 62% Deposits Outstanding ($ in millions) $7,386 $7,836 $8,334 $8,068 $9,244 $4,333 $4,716 $4,932 $4,966 $5,776 $2,440 $2,618 $2,785 $2,547 $2,937 $613 $502 $617 $555 $531 0.25% 0.25% 0.25% 0.25% 0.50% 0.13% 0.08% 0.07% 0.06% 0.06% Transaction Accounts Savings & Money Market Time Deposits Fed Funds Cost of Deposits 1Q'21 2Q'21 3Q'21 4Q'21 1Q'22 Strong Deposit Franchise Supported by Attractive Markets Continued focus on organic growth and relationship- based funding, in combination with our innovative analytics platform, supports a well-diversified, low-cost deposit portfolio. Total deposits increased $1.2 billion quarter-over- quarter. The acquisitions of BBFC and Sabal Palm resulted in additions of $562.3 million in total deposits during the first quarter of 2022. Organic deposits increased 25% on an annualized basis. Transaction accounts increased 33% year-over-year and represent 62% of overall deposit funding. As of March 31, 2022, deposits per banking center were $163.4 million, compared to $153.6 million at December 31, 2021.
17FIRST QUARTER 2022 EARNINGS PRESENTATION $589 $1,025 $1,228 1Q'20 1Q'21 1Q'22 Assets Under Management ($ in millions) 38% CA GR A Continued Focus on Building Wealth Management Assets under management totaled $1.2 billion at March 31, 2022, increasing 20% from March 31, 2021. 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 $2.7 million in the first quarter of 2022, compared to $2.4 million in the prior quarter, and $2.3 million in the prior year quarter. Since March 31, 2020, assets under management have increased at a compound annual growth rate (“CAGR”) of 38%.
18FIRST QUARTER 2022 EARNINGS PRESENTATION Successful online and mobile upgrade deliver an improved customer experience 10K+ 60,000+ customers began using the system in the first week Personal Financial Management (PFM) users Seacoast Bank successfully upgraded its online and mobile banking platform in Q1 for consumers, small businesses, and commercial customers. New features and functionality enabled by best-in-class technology now deliver an improved user experience consistent across devices. Migrate over 100,000+ end users Drive adoption of new features with the goal of improving customer satisfaction 10 new features, 400+ functions in total prior P2P providervs. 30%+ adoption rate in first week over expected benchmark 75% of customers logged in through 3/31/2022. This app is fantastic and made me change banks. You can add your credit accounts and other bank accounts to it. One app that can hold on your financial institution in one!! 3x Zelle® volume Customer Adoption New feature adoption outpaced expectations with: APP STORE CUSTOMER GOALS
19FIRST QUARTER 2022 EARNINGS PRESENTATION Allowance for Credit Losses and Purchase Discount ($ in thousands) Loans Outstanding Allowance for Credit Losses % of Category Purchase Discount % of Category Construction and Land Development $ 259,421 $ 2,268 0.87 % $ 586 0.23 % Owner Occupied Commercial Real Estate 1,284,515 9,294 0.72 5,061 0.39 Commercial Real Estate 1,966,150 43,922 2.23 14,029 0.71 Residential Real Estate 1,599,645 14,075 0.88 416 0.03 Commercial & Financial 1,132,506 17,725 1.57 3,967 0.35 Consumer 169,724 2,554 1.50 67 0.04 Total Excluding PPP $ 6,411,961 $ 89,838 1.40 % $ 24,126 0.38 % Paycheck Protection Program $ 39,256 $ — — % $ — — % Total $ 6,451,217 $ 89,838 1.39 % $ 24,126 0.37 % The acquisitions of Sabal Palm Bank and Florida Business Bank resulted in an initial provision for credit losses of $5.1 million impacting the first quarter 2022. The total allowance for credit losses of $89.8 million as of March 31, 2022 represents management’s estimate of lifetime expected credit losses. The remaining unrecognized discount on acquired loans of $24.1 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 $2.4 million is reflected within Other Liabilities.
20FIRST QUARTER 2022 EARNINGS PRESENTATION Net Charge-Offs $370 $655 $1,432 $570 $790.03% 0.05% 0.10% 0.04% NCO NCO/Total Loans 1Q'21 2Q'21 3Q'21 4Q'21 1Q'22 Nonperforming Loans $35,328 $32,920 $32,612 $30,598 $26,209 0.62% 0.61% 0.55% 0.52% 0.41% NPL NPL/Total Loans 1Q'21 2Q'21 3Q'21 4Q'21 1Q'22 $86,643 $81,127 $87,823 $83,315 $89,838 1.71% 1.60% 1.54% 1.43% 1.40% 1.53% 1.49% 1.49% 1.41% 1.39% ACL ACL/Total Loans Excluding PPP ACL/Total Loans 1Q'21 2Q'21 3Q'21 4Q'21 1Q'22 9% 7% 10% 9% 8% 7% 6% 4% 4% 4% Classified Special Mention 1Q'21 2Q'21 3Q'21 4Q'21 1Q'22 Allowance for Credit Losses ($ in thousands) Criticized Loans as a % of Risk-Based Capital Continued Strong Asset Quality Trends
21FIRST QUARTER 2022 EARNINGS PRESENTATION $16.62 $17.08 $17.52 $17.84 $17.12 $20.89 $21.33 $22.12 $22.40 $22.15 Tangible Book Value Per Share Book Value Per Share 1Q'21 2Q'21 3Q'21 4Q'21 1Q'22 10.7% 10.4% 10.6% 11.1% 9.9% 1Q'21 2Q'21 3Q'21 4Q'21 1Q'22 19.1% 19.2% 18.6% 18.2% 17.7%18.1% 18.3% 17.7% 17.4% 16.8% Total Risk Based Capital Tier 1 Ratio 1Q'21 2Q'21 3Q'21 4Q'21 1Q'22 15.6% 13.9% 9.6% 14.3% 8.0% 16.0% 14.3% 11.7% 14.1% 10.0% GAAP - ROTCE Adjusted - ROTCE 1Q'21 2Q'21 3Q'21 4Q'21 1Q'22 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 Strong Capital Supporting a Fortress Balance Sheet
22FIRST QUARTER 2022 EARNINGS PRESENTATION $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 $17.52 $17.84 $17.12 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 3Q'21 4Q'21 1Q'22 • The decline in tangible book value per share during the first quarter of 2022 was primarily attributed to the decrease in fair value of debt securities driven by the change in the rate environment. Excluding the decrease in fair value of debt securities, tangible book value per share would have been $18.19, or an increase of 9% year-over-year. • 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. In the second quarter of 2022, the dividend increases to $0.17 per share. Long Term Growth in Shareholder Value Compounded annual growth rate of 10% in tangible book value per share since the first quarter of 2017.
Tracey L. Dexter Executive Vice President Chief Financial Officer (772) 403-0461 INVESTOR RELATIONS NASDAQ: SBCF
24FIRST QUARTER 2022 EARNINGS PRESENTATION Appendix
25FIRST QUARTER 2022 EARNINGS PRESENTATION Quarterly Trend (Amounts in thousands) 1Q'22 4Q'21 3Q'21 2Q'21 1Q'21 Commercial pipeline at period end $ 619,547 $ 397,822 $ 368,907 $ 322,014 $ 240,871 Commercial loan originations1 372,986 408,948 331,618 193,028 204,253 Residential pipeline-saleable at period end 25,745 30,102 42,847 60,585 92,141 Residential loans-sold 51,222 69,224 95,136 120,099 138,337 Residential pipeline-portfolio at period end 87,950 25,589 35,387 54,132 72,448 Residential loans-retained2 175,457 49,065 250,820 118,126 46,620 Consumer pipeline at period end 61,613 29,739 30,980 31,748 28,127 Consumer originations 79,010 72,626 66,400 63,702 46,745 PPP originations — — — 23,529 232,478 Total Pipelines at Period End $ 794,855 $ 483,252 $ 478,121 $ 468,479 $ 433,587 Total Originations $ 678,675 $ 599,863 $ 743,974 $ 518,484 $ 668,433 1Includes purchases of $19.3 million in 4Q’21 and $17.1 million in 3Q’21. 2Includes purchases of $111.3 million in 1Q’22, $180.8 million in 3Q'21 and $38.4 million in 2Q’21. Loan Production and Pipeline Trend
26FIRST QUARTER 2022 EARNINGS PRESENTATION Fair Value of Assets and Liabilities Acquired (In thousands) January 3, 2022 Assets: Cash $ 38,332 Debt Securities 26,011 Loans by Segment Construction and Land Development 8,414 Commercial Real Estate - Owner-Occupied 44,564 Commercial Real Estate - Non-Owner-Occupied 52,034 Residential Real Estate 5,421 Commercial and Financial 9,321 Consumer 61 PPP Loans 1,959 Total Loans 121,774 Fixed Assets 2,102 Core Deposit Intangibles 2,621 Goodwill 7,962 Totals $ 198,802 Liabilities Deposits 166,326 Other Liabilities 499 Totals $ 166,825 Business Bank of Florida, Corp. Acquisition Loan Portfolio Valuation and CECL Impact • 3.18% / $3.9 million total pre-tax mark, including: ◦ $2.1 million of accretable mark and ◦ $1.8 million initial ACL • Day 1 provision of $1.8 million Purchase Price (In thousands, except per share data) January 3, 2022 Total number of SBCF common shares issued 889 Multiplied by common stock price per share on January 3, 2022 $ 35.39 Value of common stock issued 31,480 Fair value of options converted 497 Total Purchase Price $ 31,977
27FIRST QUARTER 2022 EARNINGS PRESENTATION Fair Value of Assets and Liabilities Acquired (In thousands) January 3, 2022 Assets: Cash $ 170,609 Time Deposits with other banks 6,473 Loans by Segment Construction and Land Development 9,009 Commercial Real Estate - Owner-Occupied 56,591 Commercial Real Estate - Non-Owner-Occupied 87,280 Residential Real Estate 72,227 Commercial and Financial 17,501 Consumer 232 PPP Loans 3,312 Total Loans 246,152 Fixed Assets 1,745 Core Deposit Intangibles 5,587 Goodwill 26,489 Other Assets 5,189 Totals $ 462,244 Liabilities Deposits 395,952 Other Liabilities 4,194 Totals $ 400,146 Loan Portfolio Valuation and CECL Impact • 2.45% / $6.1 million total pre-tax mark, including: ◦ $2.7 million of accretable mark and ◦ $3.4 million initial ACL • Day 1 provision of $3.3 million Sabal Palm Bancorp, Inc. Acquisition Purchase Price (In thousands, except per share data) January 3, 2022 Total number of SBCF common shares issued 1,660 Multiplied by common stock price per share on January 3, 2022 $ 35.39 Value of common stock issued 58,762 Fair value of options converted 3,336 Total Purchase Price $ 62,098
28FIRST QUARTER 2022 EARNINGS PRESENTATION Transaction Value • $168.3 million fully diluted, $36.65 per Apollo Bancshares, Inc. common share1 Consideration • Apollo Bancshares, Inc. shareholders will receive 1.006529 shares of Seacoast common stock • Apollo Bank minority interest shareholders will receive 1.195651 shares of Seacoast common stock • Options are rolled over into Seacoast options based on an exchange ratio of 1.006529 Closing • Expected early fourth quarter 2022 Required Approvals • Regulatory authorities • Apollo Bancshares, Inc. and Apollo Bank shareholders Additional Details and Assumptions • Apollo shareholders to own approximately 6.9% of Seacoast following the transaction • Approximately 39% cost savings (100% realized in 2023 and thereafter) • Estimated core deposit intangibles of 1.75% amortized using straight-line method over 6 years • 2.40% / $16.4 million gross pre-tax credit mark on the loan portfolio • Pre-tax negative interest rate mark on securities portfolio of ~$8.2 million, amortized over the expected life of the portfolio. Apollo’s existing accumulated other comprehensive income on its balance sheet is included in this interest rate mark • Other rate and fair value marks of a combined net ~$2.8 million of pre-tax purchase accounting marks representing a positive impact on equity at closing 1Based on Seacoast closing price of $35.48 on March 28, 2022 and based on a blended exchange ratio of 1.0328x Seacoast shares Source: S&P Capital IQ Pro Apollo Bancshares, Inc. Transaction Summary
29FIRST QUARTER 2022 EARNINGS PRESENTATION 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. Explanation of Certain Unaudited Non-GAAP Financial Measures
30FIRST QUARTER 2022 EARNINGS PRESENTATION Quarterly Trend (Amounts in thousands except per share data) 1Q'22 4Q'21 3Q'21 2Q'21 1Q'21 Net Income $ 20,588 $ 36,330 $ 22,944 $ 31,410 $ 33,719 Total noninterest income 15,373 18,706 19,028 15,322 17,671 Securities losses/(gains), net 452 379 30 55 114 Gain on sale of domain name (included in other income) — (755) — — — Total Adjustments to Noninterest Income 452 (376) 30 55 114 Total Adjusted Noninterest Income 15,825 18,330 19,058 15,377 17,785 Total noninterest expense 58,917 50,263 55,268 45,784 46,120 Merger related charges (6,692) (482) (6,281) (509) (581) Amortization of intangibles (1,446) (1,304) (1,306) (1,212) (1,211) Branch reductions and other expense initiatives (74) (168) (870) (663) (449) Total Adjustments to Noninterest Expense (8,212) (1,954) (8,457) (2,384) (2,241) Total Adjusted Noninterest Expense 50,705 48,309 46,811 43,400 43,879 Income Taxes 5,834 8,344 7,049 8,785 10,157 Tax effect of adjustments 2,196 280 2,081 598 577 Effect of change in corporate tax rate on deferred tax assets — 774 — — — Total Adjustments to Income Taxes 2,196 1,054 2,081 598 577 Adjusted Income Taxes 8,030 9,398 9,130 9,383 10,734 Adjusted Net Income $ 27,056 $ 36,854 $ 29,350 $ 33,251 $ 35,497 Earnings per diluted share, as reported $ 0.33 $ 0.62 $ 0.40 $ 0.56 $ 0.60 Adjusted Earnings per Diluted Share 0.44 0.62 0.51 0.59 0.63 Average diluted shares outstanding 61,704 59,016 57,645 55,901 55,992 GAAP to Non-GAAP Reconciliation
31FIRST QUARTER 2022 EARNINGS PRESENTATION Quarterly Trend (Amounts in thousands except per share data) 1Q'22 4Q'21 3Q'21 2Q'21 1Q'21 Adjusted Noninterest Expense $ 50,705 $ 48,309 $ 46,811 $ 43,400 $ 43,879 Foreclosed property expense and net (loss)/gain on sale 164 175 (66) 90 65 Provision for unfunded commitments (142) — (133) — — Net Adjusted Noninterest Expense $ 50,727 $ 48,484 $ 46,612 $ 43,490 $ 43,944 Revenue $ 91,895 $ 90,995 $ 90,352 $ 81,124 $ 84,281 Total Adjustments to Revenue 452 (376) 30 55 114 Impact of FTE adjustment 117 123 131 131 131 Adjusted Revenue on a Fully Taxable Equivalent Basis $ 92,464 $ 90,742 $ 90,513 $ 81,310 $ 84,526 Adjusted Efficiency Ratio 54.86 % 53.43 % 51.50 % 53.49 % 51.99 % Net Interest Income $ 76,522 $ 72,289 $ 71,324 $ 65,802 $ 66,610 Impact of FTE adjustment 117 123 131 131 131 Net Interest Income including FTE adjustment $ 76,639 $ 72,412 $ 71,455 $ 65,933 $ 66,741 Total noninterest income 15,373 18,706 19,028 15,322 17,671 Total noninterest expense 58,917 50,263 55,268 45,784 46,120 Pre-Tax Pre-Provision Earnings $ 33,095 $ 40,855 $ 35,215 $ 35,471 $ 38,292 Total Adjustments to Noninterest Income 452 (376) 30 55 114 Total Adjustments to Noninterest Expense (8,190) (1,779) (8,656) (2,294) (2,176) Adjusted Pre-Tax Pre-Provision Earnings $ 41,737 $ 42,258 $ 43,901 $ 37,820 $ 40,582 Average Assets $ 10,628,516 $ 10,061,382 $ 9,753,734 $ 9,025,846 $ 8,485,354 Less average goodwill and intangible assets (304,321) (267,692) (254,980) (235,964) (237,323) Average Tangible Assets $ 10,324,195 $ 9,793,690 $ 9,498,754 $ 8,789,882 $ 8,248,031 GAAP to Non-GAAP Reconciliation
32FIRST QUARTER 2022 EARNINGS PRESENTATION Quarterly Trend (Amounts in thousands except per share data) 1Q'22 4Q'21 3Q'21 2Q'21 1Q'21 Return on Average Assets (ROA) 0.79 % 1.43 % 0.93 % 1.40 % 1.61 % Impact of removing average intangible assets and related amortization 0.06 0.08 0.07 0.08 0.09 Return on Average Tangible Assets (ROTA) 0.85 1.51 1.00 1.48 1.70 Impact of other adjustments for Adjusted Net Income 0.21 (0.02) 0.23 0.04 0.05 Adjusted Return on Average Tangible Assets 1.06 1.49 1.23 1.52 1.75 Average Shareholders' Equity $ 1,400,535 $ 1,303,686 $ 1,248,547 $ 1,170,395 $ 1,136,416 Less average goodwill and intangible assets (304,321) (267,692) (254,980) (235,964) (237,323) Average Tangible Equity $ 1,096,214 $ 1,035,994 $ 993,567 $ 934,431 $ 899,093 Return on Average Shareholders' Equity 5.96 % 11.06 % 7.29 % 10.76 % 12.03 % Impact of removing average intangible assets and related amortization 2.06 3.23 2.27 3.12 3.59 Return on Average Tangible Common Equity (ROTCE) 8.02 14.29 9.56 13.88 15.62 Impact of other adjustments for Adjusted Net Income 1.99 (0.18) 2.16 0.39 0.39 Adjusted Return on Average Tangible Common Equity 10.01 14.11 11.72 14.27 16.01 Loan Interest Income1 $ 67,198 $ 64,487 $ 64,517 $ 60,440 $ 62,390 Accretion on acquired loans (3,717) (3,520) (3,483) (2,886) (2,868) Interest and fees on PPP loans (1,523) (3,352) (5,917) (5,127) (6,886) Loan interest income excluding PPP and accretion on acquired loans $ 61,958 $ 57,615 $ 55,117 $ 52,427 $ 52,636 Yield on Loans1 4.30 % 4.31 % 4.49 % 4.33 % 4.39 % Impact of accretion on acquired loans (0.24) (0.24) (0.24) (0.21) (0.20) Impact of PPP loans (0.06) (0.13) (0.22) 0.01 (0.04) Yield on loans excluding PPP and accretion on acquired loans 4.00 % 3.94 % 4.03 % 4.13 % 4.15 % 1On a fully taxable equivalent basis. All yields and rates have been computed using amortized cost. GAAP to Non-GAAP Reconciliation
33FIRST QUARTER 2022 EARNINGS PRESENTATION Quarterly Trend (Amounts in thousands except per share data) 1Q'22 4Q'21 3Q'21 2Q'21 1Q'21 Net Interest income1 $ 76,639 $ 72,412 $ 71,455 $ 65,933 $ 66,741 Accretion on acquired loans (3,717) (3,520) (3,483) (2,886) (2,868) Interest and fees on PPP loans (1,523) (3,352) (5,917) (5,127) (6,886) Net interest income excluding PPP and accretion on acquired loans $ 71,399 $ 65,540 $ 62,055 $ 57,920 $ 56,987 Net Interest Margin1 3.25 % 3.16 % 3.22 % 3.23 % 3.51 % Impact of accretion on acquired loans (0.15) (0.15) (0.15) (0.14) (0.15) Impact of PPP loans (0.05) (0.10) (0.18) (0.06) (0.11) Net interest margin excluding PPP and accretion on acquired loans 3.05 % 2.91 % 2.89 % 3.03 % 3.25 % Security Interest Income1 $ 10,218 $ 8,750 $ 7,956 $ 6,745 $ 6,485 Tax equivalent adjustment on securities (37) (37) (38) (39) (39) Security interest income excluding tax equivalent adjustment $ 10,181 $ 8,713 $ 7,918 $ 6,706 $ 6,446 Loan Interest Income1 $ 67,198 $ 64,487 $ 64,517 $ 60,440 $ 62,390 Tax equivalent adjustment on loans (80) (86) (93) (92) (92) Loan interest income excluding tax equivalent adjustment $ 67,118 $ 64,401 $ 64,424 $ 60,348 $ 62,298 Net Interest Income1 $ 76,639 $ 72,412 $ 71,455 $ 65,933 $ 66,741 Tax equivalent adjustment on securities (37) (37) (38) (39) (39) Tax equivalent adjustment on loans (80) (86) (93) (92) (92) Net interest income excluding tax equivalent adjustment $ 76,522 $ 72,289 $ 71,324 $ 65,802 $ 66,610 1On a fully taxable equivalent basis. All yields and rates have been computed using amortized cost. GAAP to Non-GAAP Reconciliation