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) January 23, 2020
SEACOAST BANKING CORPORATION OF FLORIDA
(Exact Name of Registrant as Specified in Charter)
| Florida | 000-13660 | 59-2260678 | |
|---|---|---|---|
| (State or Other Jurisdiction<br><br>of Incorporation) | (Commission<br><br>File Number) | (IRS Employer<br><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 | 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 January 23, 2020, Seacoast Banking Corporation of Florida (“Seacoast” or the “Company”) announced its financial results for the quarter and year ended December 31, 2019. A copy of the press release announcing Seacoast’s results for the quarter and year ended December 31, 2019 is attached hereto as Exhibit 99.1 and incorporated herein by reference.
Item 7.01 Regulation FD Disclosure
On January 24, 2020, Seacoast will hold an investor conference call to discuss its financial results for the quarter and year ended December 31, 2019. 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 December 31, 2019, 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 January 23, 2020 with respect to Seacoast's financial results for the quarter and year ended December 31, 2019 |
| 99.2 | Data on website containing information used in the conference call to be held on January 24, 2020 |
| 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 expect to acquire, as well as statements with respect to Seacoast's objectives, strategic plans, including Vision 2020, expectations and intentions and other statements that are not historical facts. Actual results may differ from those set forth in the forward-looking statements.
Forward-looking statements include statements with respect to our beliefs, plans, objectives, goals, expectations, anticipations, estimates and intentions, and involve known and unknown risks, uncertainties and other factors, which may be beyond our control, and which may cause the actual results, performance or achievements of Seacoast to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. You should not expect us to update any forward-looking statements.
All statements other than statements of historical fact could be forward-looking statements. You can identify these forward-looking statements through our use of words such as “may”, “will”, “anticipate”, “assume”, “should”, “support”, “indicate”, “would”, “believe”, “contemplate”, “expect”, “estimate”, “continue”, “further”, “plan”, “point to”, “project”, “could”, “intend”, “target” or other similar words and expressions of the future. These forward-looking statements may not be realized due to a variety of factors, including, without limitation: the effects of future economic
and market conditions, including seasonality; 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; changes in accounting policies, rules and practices; the risks of changes in interest rates on the level and composition of deposits, loan demand, liquidity and the values of loan collateral, securities, and interest sensitive assets and liabilities; interest rate risks, sensitivities and the shape of the yield curve; uncertainty related to the impact of LIBOR calculations on securities and loans; changes in borrower credit risks and payment behaviors; changes in the availability and cost of credit and capital in the financial markets; changes in the prices, values and sales volumes of residential and commercial real estate; our ability to comply with any regulatory requirements; the effects of problems encountered by other financial institutions that adversely affect us or the banking industry; our concentration in commercial real estate loans; the failure of assumptions and estimates, as well as differences in, and changes to, economic, market and credit conditions; the impact on the valuation of our investments due to market volatility or counterparty payment risk; statutory and regulatory dividend restrictions; increases in regulatory capital requirements for banking organizations generally; the risks of mergers, acquisitions and divestitures, including our ability to continue to identify acquisition targets and successfully acquire desirable financial institutions; changes in technology or products that may be more difficult, costly, or less effective than anticipated; our ability to identify and address increased cybersecurity risks; inability of our risk management framework to manage risks associated with our business; dependence on key suppliers or vendors to obtain equipment or services for our business on acceptable terms; reduction in or the termination of our ability to use the mobile-based platform that is critical to our business growth strategy; the effects of war or other conflicts, acts of terrorism, natural disasters or other catastrophic events that may affect general economic conditions; unexpected outcomes of, and the costs associated with, existing or new litigation involving us; our ability to maintain adequate internal controls over financial reporting; potential claims, damages, penalties, fines and reputational damage resulting from pending or future litigation, regulatory proceedings and enforcement actions; the risks that our deferred tax assets could be reduced if estimates of future taxable income from our operations and tax planning strategies are less than currently estimated and sales of our capital stock could trigger a reduction in the amount of net operating loss carryforwards that we may be able to utilize for income tax purposes; the effects of competition from other commercial banks, thrifts, mortgage banking firms, consumer finance companies, credit unions, securities brokerage firms, insurance companies, money market and other mutual funds and other financial institutions operating in our market areas and elsewhere, including institutions operating regionally, nationally and internationally, together with such competitors offering banking products and services by mail, telephone, computer and the Internet; and the failure of assumptions underlying the establishment of reserves for possible loan losses.
All written or oral forward-looking statements attributable to us are expressly qualified in their entirety by this cautionary notice, including, without limitation, those risks and uncertainties described in our annual report on Form 10-K for the year ended December 31, 2018, under “Special Cautionary Notice Regarding Forward-looking Statements” and “Risk Factors”, and otherwise in our SEC reports and filings. Such reports are available upon request from the Company, or from the Securities and Exchange Commission, including through the SEC's Internet website at www.sec.gov.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
SEACOAST BANKING CORPORATION OF FLORIDA
(Registrant)
| Date: January 23, 2020 | /s/ Charles M. Shaffer |
|---|---|
| CHARLES M. SHAFFER | |
| Chief Operating Officer and Chief Financial Officer |
SBCF 4Q 2019 Earnings Release Combined Document
Charles M. Shaffer
Executive Vice President
Chief Operating Officer and
Chief Financial Officer
(772) 221-7003
Chuck.Shaffer@seacoastbank.com
SEACOAST REPORTS RECORD FOURTH QUARTER AND FULL YEAR 2019 RESULTS
Full Year 2019 Net Income Increased 47% to $98.7 million
Continued Improvements in Operating Leverage and Record Loan Originations
Highlight 4Q Results
STUART, Fla., January 23, 2020 /GLOBE NEWSWIRE/ -- Seacoast Banking Corporation of Florida (“Seacoast” or the "Company”) (NASDAQ: SBCF) today reported fourth quarter 2019 net income of $27.2 million, or $0.52 per diluted share, an increase of 70%, or $11.2 million, year-over-year. For the full year 2019, net income was $98.7 million, or $1.90 per share, an increase of 47% year-over-year. Seacoast reported fourth quarter 2019 adjusted net income^1^ of $26.8 million, or $0.52 per diluted share, an increase of 12%, or $2.9 million, compared to the fourth quarter of 2018. For the full year 2019, adjusted net income^1^ was $104.6 million, or $2.01 per share, an increase of 32% year-over-year.
For the fourth quarter of 2019, return on average tangible assets was 1.66%, return on average tangible shareholders’ equity was 15.0%, and the efficiency ratio was 48.4%, compared to 1.05%, 10.9%, and 65.8%, respectively, in the fourth quarter of 2018. For the year ended December 31, 2019, return on average tangible assets was 1.56%, return on average tangible shareholders' equity was 14.7% and the efficiency ratio was 51.7% compared to 1.20%, 14.1% and 60.0% for the year ended December 31, 2018.
Adjusted return on average tangible assets^1^ was 1.57%, adjusted return on average tangible shareholders’ equity^1^ was 14.2%, and the adjusted efficiency ratio^1^ was 47.5% in the fourth quarter of 2019, compared to 1.49%, 15.4%, and 54.2%, respectively, in the fourth quarter of 2018. For the year ended December 31, 2019, adjusted return on average tangible assets^1^ was 1.58%, adjusted return on average tangible shareholders' equity^1^ was 14.9% and the adjusted efficiency ratio^1^ was 50.9%, compared to 1.35%, 14.1% and 56.1% for the year ended December 31, 2018.
Dennis S. Hudson, III, Seacoast’s Chairman and CEO, said, "The Seacoast team closed another record year with net income of $27.2 million for the fourth quarter and $98.7 million for the full year 2019. We continue to generate disciplined growth as reflected in record originations for the quarter of $587 million, while maintaining our strict underwriting guidelines and delivering continued improvements in operating leverage."
Hudson added, "During the quarter, we announced the upcoming acquisition of First Bank of the Palm Beaches. This acquisition builds upon our two previous Palm Beach County acquisitions and strengthens our presence in Florida's largest and the nation's seventh largest MSA. We are also excited to announce the acquisition of Fourth Street Banking Company, the holding company for Freedom Bank of St. Petersburg. This is an exceptional addition to our two previous acquisitions in the state's second largest MSA. The combination of this acquisition and the First Bank transaction will provide earnings per share accretion of more than 5% to 2021 and has minimal up front dilution to tangible book value per share, earned back in less than two years."
Charles M. Shaffer, Seacoast’s Chief Operating Officer and Chief Financial Officer, said, “We delivered another quarter of consistent growth in tangible book value per share, ending the period at $14.76, up 20% over the prior year. During the fourth quarter, net interest margin declined only 1 basis point excluding the impact of accretion of purchase discounts on acquired loans, demonstrating the exceptional quality of our balance sheet and customer franchise. This balance sheet is fortified with a robust capital base, strong asset quality and a prudent liquidity position. As the banking cycle
^1^Non-GAAP measure, see “Explanation of Certain Unaudited Non-GAAP Financial Measures" for more information and for a reconciliation to GAAP.
continues to mature, Seacoast is committed to maintaining its fortress balance sheet, built on strong capital and strict credit underwriting.”
Fourth Quarter 2019 Financial Highlights
Income Statement
| • | Net income was $27.2 million, or $0.52 per diluted share, compared to $25.6 million, or $0.49, for the prior quarter and $16.0 million, or $0.31, for the fourth quarter of 2018. For the year ended December 31, 2019, net income was $98.7 million, or $1.90 per diluted share, compared to $67.3 million, or $1.38, for the year ended December 31, 2018. Adjusted net income^1^ was $26.8 million, or $0.52 per diluted share, compared to $27.7 million, or $0.53, for the prior quarter and $23.9 million, or $0.47, for the fourth quarter of 2018. For the year ended December 31, 2019, adjusted net income^1^ was $104.6 million, or $2.01 per diluted share, compared to $79.1 million, or $1.62, for the year ended December 31, 2018. |
|---|---|
| • | Net revenues were $78.1 million, an increase of $3.2 million, or 4%, compared to the prior quarter, and an increase of $5.4 million, or 7%, compared to the fourth quarter of 2018. For the year ended December 31, 2019, net revenues were $300.4 million, an increase of $38.8 million, or 15%, compared to the year ended December 31, 2018. Adjusted revenues^1^ were $75.6 million, an increase of $0.8 million, or 1%, from the prior quarter and an increase of $2.8 million, or 4%, from the fourth quarter of 2018. For the year ended December 31, 2019, adjusted revenues^1^ were $298.2 million, an increase of $36.3 million, or 14%, compared to the year ended December 31, 2018. |
| --- | --- |
| • | Net interest income totaled $61.8 million, an increase of $0.8 million, or 1%, from the prior quarter and an increase of $1.8 million, or 3%, from the fourth quarter of 2018. For the year ended December 31, 2019, net interest income was $243.6 million, an increase of $32.1 million, or 15%, compared to the year ended December 31, 2018. |
| --- | --- |
| • | Net interest margin was 3.84% in the fourth quarter of 2019, 3.89% in the third quarter of 2019 and 4.00% in the fourth quarter of 2018. Quarter-over-quarter, the yield on loans contracted 17 basis points, the yield on securities contracted 12 basis points, and the cost of deposits decreased 12 basis points. The impact on net interest margin from accretion of purchase discounts on acquired loans was 21 basis points in the fourth quarter of 2019, compared to 25 basis points in the prior quarter and 27 basis points in the fourth quarter of 2018. Excluding the impact of accretion, the net interest margin decreased only 1 basis point from the prior quarter and the yield on loans contracted 13 basis points. Decreases in the yield on both loans and securities reflect the impact of a lower interest rate environment, affecting variable-rate portfolios and resulting in lower add-on rates for new loans originated and securities purchased. |
| --- | --- |
| • | Noninterest income totaled $16.4 million, an increase of $2.4 million, or 17%, compared to the prior quarter and an increase of $3.7 million, or 29%, from the fourth quarter of 2018. For the year ended December 31, 2019, noninterest income was $56.7 million, an increase of $6.7 million, or 13%, compared to the year ended December 31, 2018. Changes in noninterest income consisted of the following: |
| --- | --- |
| ◦ | After a record third quarter boosted by refinance activity, mortgage banking fees decreased $0.6 million in the fourth quarter to $1.5 million. For the full year, mortgage banking fees increased $1.8 million, or 39%, to $6.5 million compared to the prior year, reflecting our strategic focus on generating saleable volume. |
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| ◦ | Interchange income increased $0.2 million, or 6%, in the fourth quarter, and $1.1 million, or 9%, for the full year, the result of increased transaction activity across a growing customer base. |
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| ◦ | Lower other income in the fourth quarter reflects the $1.0 million BOLI death benefit recorded in the third quarter partially offset by swap fees of $0.6 million in the fourth quarter of 2019. |
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| ◦ | During the quarter, securities gains of $2.5 million resulted from the opportunistic sale of $79.8 million of longer duration bonds yielding 2.8% transacted when the 10-year treasury rate declined early in the quarter. |
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| • | The provision for loan losses was $4.8 million compared to $2.3 million in the prior quarter and $2.3 million in the fourth quarter of 2018. The increase in provision primarily reflects strong loan growth in the fourth quarter of 2019 and a modestly higher increase in net charge-offs during the fourth quarter when compared to the third quarter of |
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^1^Non-GAAP measure, see “Explanation of Certain Unaudited Non-GAAP Financial Measures" for more information and for a reconciliation to GAAP.
- Looking back over the last four quarters, net charge offs were 0.16% of average loans outstanding, in line with our expectations and reflecting continued strong asset quality trends.
| • | Noninterest expense was $38.1 million, a decrease of $0.5 million, or 1%, compared to the prior quarter and a decrease of $11.4 million, or 23%, from the fourth quarter of 2018. For the year ended December 31, 2019, noninterest expense was $160.7 million, a decrease of $1.5 million, or 1%, compared to the year ended December 31, 2018. Changes from the third quarter of 2019 in noninterest expense consisted of the following: |
|---|---|
| ◦ | Salaries and benefits decreased $1.0 million on a combined basis, the result of lower incentive accruals and our continued proven success at focusing on cost control across the franchise. |
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| ◦ | Legal and professional fees increased $0.4 million, including $0.6 million incurred in the fourth quarter for merger related activities. |
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| ◦ | Other expenses increased $0.6 million, including increases of $0.3 million in lending-related costs to support increased production and $0.2 million in recruiting and supporting the onboarding of new sales talent. For the full year, other expenses are down $2.0 million compared to 2018, reflecting our continued focus on efficiency and streamlining operations. |
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| ◦ | During the third quarter of 2019, the FDIC announced the achievement of their target deposit insurance reserve ratio, resulting in our ability to offset FDIC assessments with previously awarded credits. The Company has remaining credits of $0.7 million, which will be applied to future assessments if the FDIC’s reserve ratio remains above the target threshold. |
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| • | Seacoast recorded $8.1 million in income tax expense in the fourth quarter of 2019, compared to $8.5 million in the prior quarter and $4.9 million in the fourth quarter of 2018. The prior quarter included net additional income tax expense of $0.7 million resulting from the change in the Florida corporate income tax rate. |
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| • | Year to date adjusted revenues^1^ increased 14% compared to prior year while adjusted noninterest expense^1^ increased 3%, generating 11% operating leverage. |
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| • | The efficiency ratio was 48.4% compared to 48.6% in the prior quarter and 65.8% in the fourth quarter of 2018. The adjusted efficiency ratio^1^ was 47.5% compared to 49.0% in the prior quarter and 54.2% in the fourth quarter of 2018. |
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Balance Sheet
| • | At December 31, 2019, the Company had total assets of $7.1 billion and total shareholders' equity of $985.6 million. Book value per share was $19.13 and tangible book value per share was $14.76, compared to $18.70 and $14.30, respectively, at September 30, 2019 and $16.83 and $12.33, respectively, at December 31, 2018. Year-over-year, tangible book value per share increased 20%. |
|---|---|
| • | Debt Securities totaled $1.2 billion at December 31, 2019, an increase of $13.8 million compared to September 30, 2019 and a decrease of $15.6 million from December 31, 2018. During the quarter, securities gains of $2.5 million resulted from the opportunistic sale of $79.8 million of longer duration bonds yielding 2.8% transacted when the 10-year treasury rate declined early in the quarter. |
| --- | --- |
| • | Loans totaled $5.2 billion at December 31, 2019, an increase of $212.1 million, or 4%, compared to September 30, 2019, and an increase of $373.2 million, or 8%, from December 31, 2018. Changes in total loans consisted of the following: |
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| ◦ | New loan originations of $587 million, compared to $488 million in the prior quarter, contributed to net loan growth in the quarter of 17% on an annualized basis. Excluding the $99.0 million residential mortgage portfolio purchased during the quarter, net loan growth was 9% on an annualized basis. Loans outstanding have grown 8% year-over-year. |
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| ◦ | Commercial originations during the fourth quarter of 2019 were $247.0 million, a decrease of $35.2 million, or 12%, compared to the third quarter of 2019. Excluding the purchase of a $52.1 million commercial real estate loan portfolio in the third quarter of 2019, commercial originations increased in the |
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^1^Non-GAAP measure, see “Explanation of Certain Unaudited Non-GAAP Financial Measures" for more information and for a reconciliation to GAAP.
fourth quarter $16.8 million, or 7%. Compared to the fourth quarter of 2018, commercial originations increased $87.6 million, or 55%.
| ◦ | Residential loan originations were $225.1 million in the fourth quarter of 2019, compared to $103.1 million in the third quarter of 2019 and $104.7 million in the fourth quarter of 2018. Originations in the fourth quarter of 2019 include the opportunistic purchase of a $99.0 million residential mortgage portfolio. Excluding that purchase, residential loan originations increased $28.8 million, or 30%, compared to the third quarter of 2019, and $21.3 million, or 20%, compared to the fourth quarter of 2018. |
|---|---|
| ◦ | Consumer and small business originations for the fourth quarter of 2019 were $115.0 million, an increase of 12% compared to the third quarter of 2019 and an increase of 1% compared to the fourth quarter of 2018. |
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| ◦ | The Company continues to prudently manage commercial real estate exposure. Construction and land development and commercial real estate loans remain well below regulatory guidance at 40% and 204% of total bank-level risk based capital, respectively, compared to 42% and 204%, respectively, in the third quarter of 2019. On a consolidated basis, construction and land development and commercial real estate loans represent 38% and 191%, respectively, of total consolidated risk based capital. |
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| ◦ | The funded balances of our top 10 and top 20 relationships represented 21% and 39%, respectively, of total consolidated risk based capital, compared to 22% and 37% in the fourth quarter of 2018 and 34% and 54% in the fourth quarter of 2016. Our average commercial loan size is $365,000. |
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| • | Pipelines (loans in underwriting and approval or approved and not yet closed) totaled $339.2 million at December 31, 2019. |
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| ◦ | Commercial pipelines were $256.0 million, an increase of 56% compared to December 31, 2018. The increase year-over-year reflects the successful addition of talent to our commercial banking team and better execution across the franchise. |
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| ◦ | Residential saleable pipelines were $19.0 million, an increase of 40% compared to December 31, 2018. The year-over-year increase reflects our continued strategic focus of generating saleable volume and the addition of talent across the franchise. |
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| ◦ | Retained residential pipelines were $19.1 million, a decrease of 37% compared to December 31, 2018. The year-over-year decrease reflects our continued strategic focus on generating saleable volume. |
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| ◦ | Consumer and small business pipelines were $45.1 million, a decrease of 16% compared to December 31, 2018. |
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| • | Total deposits were $5.6 billion as of December 31, 2019, a decrease of $88.4 million, or 2%, sequentially and an increase of $407.5 million, or 8%, from the prior year. |
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| ◦ | Overall cost of deposits declined to 61 basis points in the fourth quarter of 2019 from 73 basis points in the prior quarter, reflecting the impact of interest rate cuts in the second half of 2019 by the Federal Reserve. By keeping a targeted focus on customer acquisition and a relationship-driven strategy, the Company has successfully maintained discipline in deposit pricing. |
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| ◦ | Total transaction accounts increased 7% year-over-year, reflecting continued strong growth in core customer balances, and represent 50% of overall deposit funding. |
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| ◦ | Interest-bearing deposits (interest-bearing demand, savings and money market deposits) increased year-over-year $127.5 million, or 5%, to $2.8 billion, noninterest bearing demand deposits increased $20.9 million, or 1%, to $1.6 billion, and CDs (excluding brokered) increased $6.9 million, or 1%, to $712.2 million. |
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| • | Fourth quarter return on average tangible assets (ROTA) was 1.66%, compared to 1.61% in the prior quarter and 1.05% in the fourth quarter of 2018. Adjusted ROTA^1^ was 1.57% compared to 1.67% in the prior quarter and 1.49% in the fourth quarter of 2018. The decline in adjusted ROTA^1^in the current quarter reflects the impact of higher provision expense and substantial loan growth, partially offset by higher net interest income and lower noninterest expense. |
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^1^Non-GAAP measure, see “Explanation of Certain Unaudited Non-GAAP Financial Measures" for more information and for a reconciliation to GAAP.
Capital
| • | Fourth quarter return on average tangible common equity (ROTCE) was 15.0%, compared to 14.7% in the prior quarter and 10.9% in the fourth quarter of 2018. Adjusted ROTCE^1^ was 14.2% compared to 15.3% in the prior quarter and 15.4% in the fourth quarter of 2018. The decline in adjusted ROTCE^1^in the fourth quarter reflects the impact of a robust growing capital base. |
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| • | The tier 1 capital ratio was 15.0%, total capital ratio was 15.7% and the tier 1 leverage ratio was 12.2% at December 31, 2019. |
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| • | Tangible common equity to tangible assets was 11.1% at December 31, 2019, compared to 11.1% at September 30, 2019 and 9.7% at December 31, 2018. |
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Asset Quality
| • | Nonperforming loans to total loans outstanding was 0.52% at December 31, 2019, 0.52% at September 30, 2019, and 0.55% at December 31, 2018. |
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| • | Nonperforming assets to total assets was 0.55% at December 31, 2019, 0.58% at September 30, 2019 and 0.58% at December 31, 2018. |
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| • | The ratio of allowance for loan losses to total loans was 0.68% at December 31, 2019, 0.67% at September 30, 2019, and 0.67% at December 31, 2018. The ratio of allowance for loan losses to non-acquired loans was 0.80% at December 31, 2019, 0.84% at September 30, 2019, and 0.89% at December 31, 2018. |
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| • | Net charge-offs were $3.2 million, or 0.25%, of average loans for the fourth quarter of 2019 compared to $2.1 million, or 0.17%, of average loans in the third quarter of 2019 and $3.7 million, or 0.32% of average loans in the fourth quarter of 2018. Net charge-offs for the four most recent quarters averaged 0.16%, in line with our expectations for full year 2019. |
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^1^Non-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 | |||||||||||||||
| 4Q'19 | 3Q'19 | 2Q'19 | 1Q'19 | 4Q'18 | |||||||||||
| Selected Balance Sheet Data: | |||||||||||||||
| Total Assets | $ | 7,108,511 | $ | 6,890,645 | $ | 6,824,886 | $ | 6,783,389 | $ | 6,747,659 | |||||
| Gross Loans | 5,198,404 | 4,986,289 | 4,888,139 | 4,828,441 | 4,825,214 | ||||||||||
| Total Deposits | 5,584,753 | 5,673,141 | 5,541,209 | 5,605,578 | 5,177,240 | ||||||||||
| Performance Measures: | |||||||||||||||
| Net Income | $ | 27,176 | $ | 25,605 | $ | 23,253 | $ | 22,705 | $ | 15,962 | |||||
| Net Interest Margin | 3.84 | % | 3.89 | % | 3.94 | % | 4.02 | % | 4.00 | % | |||||
| Average Diluted Shares Outstanding | 52,081 | 51,935 | 51,952 | 52,039 | 51,237 | ||||||||||
| Diluted Earnings Per Share (EPS) | $ | 0.52 | $ | 0.49 | $ | 0.45 | $ | 0.44 | $ | 0.31 | |||||
| Return on (annualized): | |||||||||||||||
| Average Assets (ROA) | 1.54 | % | 1.49 | % | 1.38 | % | 1.36 | % | 0.96 | % | |||||
| Average Tangible Assets (ROTA) | 1.66 | 1.61 | 1.50 | 1.48 | 1.05 | ||||||||||
| Average Tangible Common Equity (ROTCE) | 14.95 | 14.73 | 14.30 | 14.86 | 10.94 | ||||||||||
| Efficiency Ratio | 48.36 | 48.62 | 53.48 | 56.55 | 65.76 | ||||||||||
| Adjusted Operating Measures^1^: | |||||||||||||||
| Adjusted Net Income | $ | 26,837 | $ | 27,731 | $ | 25,818 | $ | 24,205 | $ | 23,893 | |||||
| Adjusted Diluted EPS | 0.52 | 0.53 | 0.50 | 0.47 | 0.47 | ||||||||||
| Adjusted ROTA | 1.57 | % | 1.67 | % | 1.59 | % | 1.50 | % | 1.49 | % | |||||
| Adjusted ROTCE | 14.19 | 15.30 | 15.17 | 15.11 | 15.44 | ||||||||||
| Adjusted Efficiency Ratio | 47.52 | 48.96 | 51.44 | 55.81 | 54.19 | ||||||||||
| Adjusted Noninterest Expense as a <br>Percent of Average Tangible Assets | 2.11 | 2.22 | 2.34 | 2.55 | 2.46 | ||||||||||
| Other Data: | |||||||||||||||
| Market capitalization^2^ | $ | 1,574,775 | $ | 1,303,010 | $ | 1,309,158 | $ | 1,354,759 | $ | 1,336,415 | |||||
| Full-time equivalent employees | 867 | 867 | 852 | 902 | 902 | ||||||||||
| Number of ATMs | 78 | 80 | 81 | 84 | 87 | ||||||||||
| Full service banking offices | 48 | 48 | 49 | 50 | 51 | ||||||||||
| Registered online users | 109,684 | 107,241 | 104,017 | 102,274 | 99,415 | ||||||||||
| Registered mobile devices | 99,361 | 96,384 | 92,281 | 87,844 | 83,151 | ||||||||||
| ^1^Non-GAAP measure, see “Explanation of Certain Unaudited Non-GAAP Financial Measures" for more information and a reconciliation to GAAP | |||||||||||||||
| ^2^Common shares outstanding multiplied by closing bid price on last day of each period |
Vision 2020
Seacoast remains confident in the Company's ability to achieve Vision 2020 targets announced in February 2017.
| Vision 2020 Targets | |
|---|---|
| Return on Tangible Assets | 1.30% + |
| Return on Tangible Common Equity | 16% + |
| Efficiency Ratio | Below 50% |
Since announcing Vision 2020 targets in February 2017, the Company has achieved a compounded annual growth rate in tangible book value per share of 13%, steadily building shareholder value.
Fourth Quarter and Full Year 2019 Operating Highlights
Modernizing How Seacoast Sells
| • | In 2019, interchange income increased by $1.1 million, or 9%, compared to the prior year as Seacoast’s debit card program surpassed $1 billion in retail sales. The Company’s debit card program consistently performs in the top quartile of Visa partner banks of similar size. |
|---|---|
| • | Seacoast Wealth Management added approximately $140 million in new assets under management in 2019, growing 27% year-over-year. Growth in assets under management, industry leading products and investments in sales and support teams throughout the footprint resulted in a 7% increase year-over-year in wealth related revenue. |
| --- | --- |
| • | Seacoast has partnered with a leading consumer insights firm to capture and analyze feedback from customers. Program implementation and launch were completed in the third quarter of 2019, with the objective of identifying additional customer opportunities. |
| --- | --- |
Lowering Cost to Serve
| • | Seacoast consolidated three banking center locations in 2019, achieving the Vision 2020 objective of reducing the footprint by 20% to meet evolving customer needs. At December 31, 2019, deposits per banking center exceeded $116 million compared to $102 million at December 31, 2018. |
|---|
Driving Improvements to Operations
| • | In 2019, Seacoast's continued focus on efficiency and streamlining operations improved adjusted noninterest expenses^1^ as a percent of average tangible assets to 2.11% in the fourth quarter compared to 2.46% a year ago. |
|---|---|
| • | Earlier this year, Seacoast further enhanced the interactive voice response (IVR) system in the Florida-based Customer Support Center. The system provides customers with secure, self-serve options and expedites call routing processes. During the fourth quarter of 2019, more than 215,000 routine customer service calls were serviced solely by the IVR system. This represented 71% of total customer service calls received. This investment should continue to provide added scalability and elevate the customer experience in 2020. |
| --- | --- |
| • | Late in 2018, Seacoast launched a large-scale initiative to implement a fully digital loan origination platform across all business banking units. In the fourth quarter of 2019, this platform enabled record loan originations in the commercial banking team. The Company recognized $350,000 in annualized expense reductions as a result of this platform implementation. This investment should lead to further gains in operational efficiency and banker productivity in 2020 and beyond. |
| --- | --- |
Scaling and Evolving Seacoast's Culture
| • | Seacoast's balanced growth strategy, combining organic growth with value-creating acquisitions, continues to benefit shareholders and provide new opportunities for associates. The pending acquisitions of First Bank of the Palm Beaches and Fourth Street Banking Company, subject to shareholder and regulatory approvals, will add experienced bankers in two growing markets and will further support the Company's sustainable and profitable growth. |
|---|
OTHER INFORMATION
Conference Call Information
Seacoast will host a conference call on January 24, 2020 at 10:00 a.m. (Eastern Time) to discuss the fourth quarter and full year 2019 earnings results and business trends. Investors may call in (toll-free) by dialing (888) 517-2513 (passcode: 7556 513; host: Dennis S. Hudson). 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 of January 24, 2020 by dialing (888) 843-7419 (domestic) and using passcode: 7556 513#.
Alternatively, individuals may listen to the live webcast of the presentation by visiting Seacoast's website at www.SeacoastBanking.com. The link is located in the subsection "Presentations" under the heading "Investor Services." Beginning the afternoon of January 24, 2020, an archived version of the webcast can be accessed from this same subsection of the website. The archived webcast will be available for one year.
About Seacoast Banking Corporation of Florida (NASDAQ: SBCF)
Seacoast Banking Corporation of Florida is one of the largest community banks headquartered in Florida with approximately $7.1 billion in assets and $5.6 billion in deposits as of December 31, 2019. The Company provides integrated financial services including commercial and retail banking, wealth management, and mortgage services to customers through advanced banking solutions, and 48 traditional branches of its locally-branded, wholly-owned subsidiary bank, Seacoast Bank. Offices stretch from Fort Lauderdale, Boca Raton and West Palm Beach north through the Daytona Beach area, into Orlando and Central Florida and the adjacent Tampa market, and west to Okeechobee and surrounding counties. More information about the Company is available at www.SeacoastBanking.com.
Additional Information
Seacoast has filed a registration statement on Form S-4 with the United States Securities and Exchange Commission (the “SEC”) in connection with the proposed merger of First Bank of the Palm Beaches (“First Bank”) with and into Seacoast Bank and will file a registration statement on Form S-4 with the SEC in connection with the proposed merger of Fourth Street Banking Company (“Fourth Street”) with and into Seacoast and Freedom Bank with and into Seacoast Bank. The registration statement in connection with the First Bank merger includes a proxy statement of First Bank and a prospectus of Seacoast and the registration statement in connection with the Fourth Street merger will include a proxy statement of Fourth Street and a prospectus of Seacoast. A definitive proxy statement/prospectus will be mailed to shareholders of First Bank and Fourth Street. This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval. WE URGE INVESTORS TO READ THE PROXY STATEMENTS/PROSPECTUSES AND ANY OTHER DOCUMENTS TO BE FILED WITH THE SEC IN CONNECTION WITH THE MERGERS OR INCORPORATED BY REFERENCE IN THE PROXY STATEMENTS/PROSPECTUSES BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION.
Investors may obtain (when available) these documents free of charge at the SEC’s Web site (www.sec.gov). In addition, documents filed with the SEC by Seacoast will be available free of charge by contacting Investor Relations at (772) 288-6085.
First Bank and Fourth Street, their directors, and executive officers and other members of management and employees may be considered participants in the solicitation of proxies in connection with the proposed mergers of First Bank with and into Seacoast Bank and Fourth Street with and into Seacoast. Information regarding the participants in the proxy solicitation of First Bank and a description of their direct and indirect interests, by security holdings or otherwise, is contained in the proxy statement/prospectus and other relevant materials to be filed with the SEC. Information regarding the participants in the proxy solicitation of Fourth Street and a description of their direct and indirect interests, by security holdings or otherwise, will be contained in the proxy statement/prospectus and other relevant materials to be filed with the SEC.
^1^Non-GAAP measure, see “Explanation of Certain Unaudited Non-GAAP Financial Measures" for more information and for a reconciliation to GAAP.
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 our markets, and improvements to reported earnings that may be realized from cost controls, tax law changes, new initiatives and for integration of banks that we have acquired, or expect to acquire, including First Bank, as well as statements with respect to Seacoast's objectives, strategic plans, including Vision 2020, expectations and intentions and other statements that are not historical facts. Actual results may differ from those set forth in the forward-looking statements.
Forward-looking statements include statements with respect to our beliefs, plans, objectives, goals, expectations, anticipations, assumptions, estimates and intentions about future performance and involve known and unknown risks, uncertainties and other factors, which may be beyond our control, and which may cause the actual results, performance or achievements of Seacoast to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. You should not expect us to update any forward-looking statements.
All statements other than statements of historical fact could be forward-looking statements. You can identify these forward-looking statements through our use of words such as "may", "will", "anticipate", "assume", "should", "support", "indicate", "would", "believe", "contemplate", "expect", "estimate", "continue", "further", "plan", "point to", "project", "could", "intend", "target" or other similar words and expressions of the future. These forward-looking statements may not be realized due to a variety of factors, including, without limitation: the effects of future economic and market conditions, including seasonality; 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; changes in accounting policies, rules and practices; the risks of changes in interest rates on the level and composition of deposits, loan demand, liquidity and the values of loan collateral, securities, and interest sensitive assets and liabilities; interest rate risks, sensitivities and the shape of the yield curve; uncertainty related to the impact of LIBOR calculations on securities and loans; changes in borrower credit risks and payment behaviors; changes in the availability and cost of credit and capital in the financial markets; changes in the prices, values and sales volumes of residential and commercial real estate; our ability to comply with any regulatory requirements; the effects of problems encountered by other financial institutions that adversely affect us or the banking industry; our concentration in commercial real estate loans; the failure of assumptions and estimates, as well as differences in, and changes to, economic, market and credit conditions; the impact on the valuation of our investments due to market volatility or counterparty payment risk; statutory and regulatory dividend restrictions; increases in regulatory capital requirements for banking organizations generally; the risks of mergers, acquisitions and divestitures, including our ability to continue to identify acquisition targets and successfully acquire desirable financial institutions; changes in technology or products that may be more difficult, costly, or less effective than anticipated; our ability to identify and address increased cybersecurity risks; inability of our risk management framework to manage risks associated with our business; dependence on key suppliers or vendors to obtain equipment or services for our business on acceptable terms; reduction in or the termination of our ability to use the mobile-based platform that is critical to our business growth strategy; the effects of war or other conflicts, acts of terrorism, natural disasters or other catastrophic events that may affect general economic conditions; unexpected outcomes of, and the costs associated with, existing or new litigation involving us; our ability to maintain adequate internal controls over financial reporting; potential claims, damages, penalties, fines and reputational damage resulting from pending or future litigation, regulatory proceedings and enforcement actions; the risks that our deferred tax assets could be reduced if estimates of future taxable income from our operations and tax planning strategies are less than currently estimated and sales of our capital stock could trigger a reduction in the amount of net operating loss carryforwards that we may be able to utilize for income tax purposes; the effects of competition from other commercial banks, thrifts, mortgage banking firms, consumer finance companies, credit unions, securities brokerage firms, insurance companies, money market and other mutual funds and other financial institutions operating in our market areas and elsewhere, including institutions operating regionally, nationally and internationally, together with such competitors offering banking products and services by mail, telephone, computer and the Internet; and the failure of assumptions underlying the establishment of reserves for possible loan losses.
The risks relating to the proposed First Bank and Fourth Street mergers include, without limitation: the timing to consummate the proposed mergers; the risk that a condition to closing of the proposed mergers may not be satisfied; the risk that a regulatory approval that may be required for the proposed mergers is not obtained or is obtained subject to conditions that are not anticipated; the diversion of management time on issues related to the proposed mergers; unexpected transaction costs, including the costs of integrating operations; the risks that the businesses will not be integrated successfully or that such integration may be more difficult, time- consuming or costly than expected; the potential failure to fully or timely realize expected revenues and revenue synergies, including as the result of revenues following the mergers being lower than expected; the risk of deposit and customer attrition; any changes in deposit mix; unexpected operating and other costs, which may differ or change from expectations; the risks of customer and employee loss and business disruptions, including, without limitation, as the result of difficulties in maintaining relationships with employees; increased competitive pressures and solicitations of customers by competitors; as well as 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 our annual report on Form 10-K for the year ended December 31, 2018, under "Special Cautionary Notice Regarding Forward-looking Statements" and "Risk Factors", and otherwise in our SEC reports and filings. Such reports are available upon request from the Company, or from the Securities and Exchange Commission, including through the SEC's Internet website at www.sec.gov.
| FINANCIAL HIGHLIGHTS | (Unaudited) | ||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES | |||||||||||||||||||||
| Quarterly Trends | Twelve Months Ended | ||||||||||||||||||||
| (Amounts in thousands, except ratios and per share data) | 4Q'19 | 3Q'19 | 2Q'19 | 1Q'19 | 4Q'18 | 4Q'19 | 4Q'18 | ||||||||||||||
| Summary of Earnings | |||||||||||||||||||||
| Net income | $ | 27,176 | $ | 25,605 | $ | 23,253 | $ | 22,705 | $ | 15,962 | $ | 98,739 | $ | 67,275 | |||||||
| Adjusted net income^1^ | 26,837 | 27,731 | 25,818 | 24,205 | 23,893 | 104,591 | 79,085 | ||||||||||||||
| Net interest income^2^ | 61,846 | 61,027 | 60,219 | 60,861 | 60,100 | 243,953 | 211,956 | ||||||||||||||
| Net interest margin^2,3^ | 3.84 | % | 3.89 | % | 3.94 | % | 4.02 | % | 4.00 | % | 3.92 | % | 3.85 | % | |||||||
| Performance Ratios | |||||||||||||||||||||
| Return on average assets-GAAP basis^3^ | 1.54 | % | 1.49 | % | 1.38 | % | 1.36 | % | 0.96 | % | 1.45 | % | 1.11 | % | |||||||
| Return on average tangible assets-GAAP basis^3,4^ | 1.66 | 1.61 | 1.50 | 1.48 | 1.05 | 1.56 | 1.20 | ||||||||||||||
| Adjusted return on average tangible assets^1,3,4^ | 1.57 | 1.67 | 1.59 | 1.50 | 1.49 | 1.58 | 1.35 | ||||||||||||||
| Return on average shareholders' equity-GAAP basis^3^ | 11.04 | 10.73 | 10.23 | 10.47 | 7.65 | 10.63 | 9.08 | ||||||||||||||
| Return on average tangible common equity-GAAP basis^3,4^ | 14.95 | 14.73 | 14.30 | 14.86 | 10.94 | 14.72 | 12.54 | ||||||||||||||
| Adjusted return on average tangible common equity^1,3,4^ | 14.19 | 15.30 | 15.17 | 15.11 | 15.44 | 14.93 | 14.06 | ||||||||||||||
| Efficiency ratio^5^ | 48.36 | 48.62 | 53.48 | 56.55 | 65.76 | 51.71 | 59.98 | ||||||||||||||
| Adjusted efficiency ratio^1^ | 47.52 | 48.96 | 51.44 | 55.81 | 54.19 | 50.90 | 56.13 | ||||||||||||||
| Noninterest income to total revenue (excluding securities gains/losses) | 18.30 | 19.53 | 18.93 | 17.45 | 17.97 | 18.56 | 19.32 | ||||||||||||||
| Tangible common equity to tangible assets^4^ | 11.05 | 11.05 | 10.65 | 10.18 | 9.72 | 11.05 | 9.72 | ||||||||||||||
| Average loan-to-deposit ratio | 90.71 | 88.35 | 87.27 | 90.55 | 89.14 | 89.21 | 85.85 | ||||||||||||||
| End of period loan-to-deposit ratio | 93.44 | 88.36 | 88.53 | 86.38 | 93.43 | 93.44 | 93.43 | ||||||||||||||
| Per Share Data | |||||||||||||||||||||
| Net income diluted-GAAP basis | $ | 0.52 | $ | 0.49 | $ | 0.45 | $ | 0.44 | $ | 0.31 | $ | 1.90 | $ | 1.38 | |||||||
| Net income basic-GAAP basis | 0.53 | 0.50 | 0.45 | 0.44 | 0.32 | 1.92 | 1.40 | ||||||||||||||
| Adjusted earnings^1^ | 0.52 | 0.53 | 0.50 | 0.47 | 0.47 | 2.01 | 1.62 | ||||||||||||||
| Book value per share common | 19.13 | 18.70 | 18.08 | 17.44 | 16.83 | 19.13 | 16.83 | ||||||||||||||
| Tangible book value per share | 14.76 | 14.30 | 13.65 | 12.98 | 12.33 | 14.76 | 12.33 | ||||||||||||||
| Cash dividends declared | — | — | — | — | — | — | — | ||||||||||||||
| ^1^Non-GAAP measure - see "Explanation of Certain Unaudited Non-GAAP Financial Measures" for more information and a reconciliation to GAAP. | |||||||||||||||||||||
| ^2^Calculated on a fully taxable equivalent basis using amortized cost. | |||||||||||||||||||||
| ^3^These ratios are stated on an annualized basis and are not necessarily indicative of future periods. | |||||||||||||||||||||
| ^4^The Company defines tangible assets as total assets less intangible assets, and tangible common equity as total shareholders' equity less | |||||||||||||||||||||
| intangible assets. | |||||||||||||||||||||
| ^5^Defined 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). |
| CONDENSED CONSOLIDATED STATEMENTS OF INCOME | (Unaudited) | ||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES | |||||||||||||||||||
| Quarterly Trends | Twelve Months Ended | ||||||||||||||||||
| (Amounts in thousands, except per share data) | 4Q'19 | 3Q'19 | 2Q'19 | 1Q'19 | 4Q'18 | 4Q'19 | 4Q'18 | ||||||||||||
| Interest on securities: | |||||||||||||||||||
| Taxable | $ | 8,500 | $ | 8,802 | $ | 8,933 | $ | 9,119 | $ | 9,528 | $ | 35,354 | $ | 37,860 | |||||
| Nontaxable | 130 | 131 | 143 | 151 | 200 | 555 | 884 | ||||||||||||
| Interest and fees on loans | 62,868 | 63,092 | 62,288 | 62,287 | 59,495 | 250,535 | 199,984 | ||||||||||||
| Interest on federal funds sold and other investments | 788 | 800 | 873 | 918 | 835 | 3,379 | 2,670 | ||||||||||||
| Total Interest Income | 72,286 | 72,825 | 72,237 | 72,475 | 70,058 | 289,823 | 241,398 | ||||||||||||
| Interest on deposits | 3,589 | 4,334 | 4,825 | 3,873 | 3,140 | 16,621 | 8,763 | ||||||||||||
| Interest on time certificates | 5,084 | 6,009 | 5,724 | 4,959 | 3,901 | 21,776 | 11,684 | ||||||||||||
| Interest on borrowed money | 1,853 | 1,534 | 1,552 | 2,869 | 3,033 | 7,808 | 9,436 | ||||||||||||
| Total Interest Expense | 10,526 | 11,877 | 12,101 | 11,701 | 10,074 | 46,205 | 29,883 | ||||||||||||
| Net Interest Income | 61,760 | 60,948 | 60,136 | 60,774 | 59,984 | 243,618 | 211,515 | ||||||||||||
| Provision for loan losses | 4,800 | 2,251 | 2,551 | 1,397 | 2,342 | 10,999 | 11,730 | ||||||||||||
| Net Interest Income After Provision for Loan Losses | 56,960 | 58,697 | 57,585 | 59,377 | 57,642 | 232,619 | 199,785 | ||||||||||||
| Noninterest income: | |||||||||||||||||||
| Service charges on deposit accounts | 2,960 | 2,978 | 2,894 | 2,697 | 3,019 | 11,529 | 11,198 | ||||||||||||
| Trust fees | 1,096 | 1,183 | 1,147 | 1,017 | 1,040 | 4,443 | 4,183 | ||||||||||||
| Mortgage banking fees | 1,514 | 2,127 | 1,734 | 1,115 | 809 | 6,490 | 4,682 | ||||||||||||
| Brokerage commissions and fees | 483 | 449 | 541 | 436 | 468 | 1,909 | 1,732 | ||||||||||||
| Marine finance fees | 338 | 153 | 201 | 362 | 185 | 1,054 | 1,398 | ||||||||||||
| Interchange income | 3,387 | 3,206 | 3,405 | 3,401 | 3,198 | 13,399 | 12,335 | ||||||||||||
| BOLI income | 904 | 928 | 927 | 915 | 1,091 | 3,674 | 4,291 | ||||||||||||
| SBA gains | 576 | 569 | 691 | 636 | 519 | 2,472 | 2,474 | ||||||||||||
| Other | 2,579 | 3,197 | 2,503 | 2,266 | 2,810 | 10,545 | 8,352 | ||||||||||||
| 13,837 | 14,790 | 14,043 | 12,845 | 13,139 | 55,515 | 50,645 | |||||||||||||
| Securities gains/(losses), net | 2,539 | (847 | ) | (466 | ) | (9 | ) | (425 | ) | 1,217 | (623 | ) | |||||||
| Total Noninterest Income | 16,376 | 13,943 | 13,577 | 12,836 | 12,714 | 56,732 | 50,022 | ||||||||||||
| Noninterest expenses: | |||||||||||||||||||
| Salaries and wages | 17,263 | 18,640 | 19,420 | 18,506 | 22,172 | 73,829 | 71,111 | ||||||||||||
| Employee benefits | 3,323 | 2,973 | 3,195 | 4,206 | 3,625 | 13,697 | 12,945 | ||||||||||||
| Outsourced data processing costs | 3,645 | 3,711 | 3,876 | 3,845 | 5,809 | 15,077 | 16,374 | ||||||||||||
| Telephone / data lines | 651 | 603 | 893 | 811 | 602 | 2,958 | 2,481 | ||||||||||||
| Occupancy | 3,368 | 3,368 | 3,741 | 3,807 | 3,747 | 14,284 | 13,394 | ||||||||||||
| Furniture and equipment | 1,416 | 1,528 | 1,544 | 1,757 | 2,452 | 6,245 | 6,744 | ||||||||||||
| Marketing | 885 | 933 | 1,211 | 1,132 | 1,350 | 4,161 | 5,085 | ||||||||||||
| Legal and professional fees | 2,025 | 1,648 | 2,033 | 2,847 | 3,668 | 8,553 | 9,961 | ||||||||||||
| FDIC assessments | 0 | 56 | 337 | 488 | 571 | 881 | 2,195 | ||||||||||||
| Amortization of intangibles | 1,456 | 1,456 | 1,456 | 1,458 | 1,303 | 5,826 | 4,300 | ||||||||||||
| Foreclosed property expense and net (gain)/loss on sale | 3 | 262 | (174 | ) | (40 | ) | 0 | 51 | 461 | ||||||||||
| Other | 4,022 | 3,405 | 3,468 | 4,282 | 4,165 | 15,177 | 17,222 | ||||||||||||
| Total Noninterest Expense | 38,057 | 38,583 | 41,000 | 43,099 | 49,464 | 160,739 | 162,273 | ||||||||||||
| Income Before Income Taxes | 35,279 | 34,057 | 30,162 | 29,114 | 20,892 | 128,612 | 87,534 | ||||||||||||
| Income taxes | 8,103 | 8,452 | 6,909 | 6,409 | 4,930 | 29,873 | 20,259 | ||||||||||||
| Net Income | $ | 27,176 | $ | 25,605 | $ | 23,253 | $ | 22,705 | $ | 15,962 | $ | 98,739 | $ | 67,275 | |||||
| Per share of common stock: | |||||||||||||||||||
| Net income diluted | $ | 0.52 | $ | 0.49 | $ | 0.45 | $ | 0.44 | $ | 0.31 | $ | 1.90 | $ | 1.38 | |||||
| Net income basic | 0.53 | 0.50 | 0.45 | 0.44 | 0.32 | 1.92 | 1.40 | ||||||||||||
| Cash dividends declared | — | — | — | — | — | — | — | ||||||||||||
| Average diluted shares outstanding | 52,081 | 51,935 | 51,952 | 52,039 | 51,237 | 52,029 | 48,748 | ||||||||||||
| Average basic shares outstanding | 51,517 | 51,473 | 51,446 | 51,359 | 50,523 | 51,449 | 47,969 |
| CONDENSED CONSOLIDATED BALANCE SHEETS | (Unaudited) | ||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES | |||||||||||||||
| December 31, | September 30, | June 30, | March 31, | December 31, | |||||||||||
| (Amounts in thousands) | 2019 | 2019 | 2019 | 2019 | 2018 | ||||||||||
| Assets | |||||||||||||||
| Cash and due from banks | $ | 89,843 | $ | 106,349 | $ | 97,792 | $ | 98,270 | $ | 92,242 | |||||
| Interest bearing deposits with other banks | 34,688 | 25,911 | 61,987 | 105,741 | 23,709 | ||||||||||
| Total Cash and Cash Equivalents | 124,531 | 132,260 | 159,779 | 204,011 | 115,951 | ||||||||||
| Time deposits with other banks | 3,742 | 4,579 | 4,980 | 8,174 | 8,243 | ||||||||||
| Debt Securities: | |||||||||||||||
| Available for sale (at fair value) | 946,855 | 920,811 | 914,615 | 877,549 | 865,831 | ||||||||||
| Held to maturity (at amortized cost) | 261,369 | 273,644 | 287,302 | 295,485 | 357,949 | ||||||||||
| Total Debt Securities | 1,208,224 | 1,194,455 | 1,201,917 | 1,173,034 | 1,223,780 | ||||||||||
| Loans held for sale | 20,029 | 26,768 | 17,513 | 13,900 | 11,873 | ||||||||||
| Loans | 5,198,404 | 4,986,289 | 4,888,139 | 4,828,441 | 4,825,214 | ||||||||||
| Less: Allowance for loan losses | (35,154 | ) | (33,605 | ) | (33,505 | ) | (32,822 | ) | (32,423 | ) | |||||
| Net Loans | 5,163,250 | 4,952,684 | 4,854,634 | 4,795,619 | 4,792,791 | ||||||||||
| Bank premises and equipment, net | 66,615 | 67,873 | 68,738 | 70,412 | 71,024 | ||||||||||
| Other real estate owned | 12,390 | 13,593 | 11,043 | 11,921 | 12,802 | ||||||||||
| Goodwill | 205,286 | 205,286 | 205,260 | 205,260 | 204,753 | ||||||||||
| Other intangible assets, net | 20,066 | 21,318 | 22,672 | 23,959 | 25,977 | ||||||||||
| Bank owned life insurance | 126,181 | 125,277 | 125,233 | 124,306 | 123,394 | ||||||||||
| Net deferred tax assets | 16,457 | 17,168 | 19,353 | 24,647 | 28,954 | ||||||||||
| Other assets | 141,740 | 129,384 | 133,764 | 128,146 | 128,117 | ||||||||||
| Total Assets | $ | 7,108,511 | $ | 6,890,645 | $ | 6,824,886 | $ | 6,783,389 | $ | 6,747,659 | |||||
| Liabilities and Shareholders' Equity | |||||||||||||||
| Liabilities | |||||||||||||||
| Deposits | |||||||||||||||
| Noninterest demand | $ | 1,590,493 | $ | 1,652,927 | $ | 1,669,804 | $ | 1,676,009 | $ | 1,569,602 | |||||
| Interest-bearing demand | 1,181,732 | 1,115,455 | 1,124,519 | 1,100,477 | 1,014,032 | ||||||||||
| Savings | 519,152 | 528,214 | 519,732 | 508,320 | 493,807 | ||||||||||
| Money market | 1,108,363 | 1,158,862 | 1,172,971 | 1,192,070 | 1,173,950 | ||||||||||
| Other time certificates | 504,837 | 537,183 | 553,107 | 539,202 | 513,312 | ||||||||||
| Brokered time certificates | 472,857 | 458,418 | 268,998 | 367,841 | 220,594 | ||||||||||
| Time certificates of more than $250,000 | 207,319 | 222,082 | 232,078 | 221,659 | 191,943 | ||||||||||
| Total Deposits | 5,584,753 | 5,673,141 | 5,541,209 | 5,605,578 | 5,177,240 | ||||||||||
| Securities sold under agreements to repurchase | 86,121 | 70,414 | 82,015 | 148,005 | 214,323 | ||||||||||
| Federal Home Loan Bank borrowings | 315,000 | 50,000 | 140,000 | 3,000 | 380,000 | ||||||||||
| Subordinated debt | 71,085 | 71,014 | 70,944 | 70,874 | 70,804 | ||||||||||
| Other liabilities | 65,913 | 63,398 | 60,479 | 59,508 | 41,025 | ||||||||||
| Total Liabilities | 6,122,872 | 5,927,967 | 5,894,647 | 5,886,965 | 5,883,392 | ||||||||||
| Shareholders' Equity | |||||||||||||||
| Common stock | 5,151 | 5,148 | 5,146 | 5,141 | 5,136 | ||||||||||
| Additional paid in capital | 786,242 | 784,661 | 782,928 | 780,680 | 778,501 | ||||||||||
| Retained earnings | 195,813 | 168,637 | 143,032 | 119,779 | 97,074 | ||||||||||
| Treasury stock | (6,032 | ) | (6,079 | ) | (6,137 | ) | (4,959 | ) | (3,384 | ) | |||||
| 981,174 | 952,367 | 924,969 | 900,641 | 877,327 | |||||||||||
| Accumulated other comprehensive income/(loss), net | 4,465 | 10,311 | 5,270 | (4,217 | ) | (13,060 | ) | ||||||||
| Total Shareholders' Equity | 985,639 | 962,678 | 930,239 | 896,424 | 864,267 | ||||||||||
| Total Liabilities & Shareholders' Equity | $ | 7,108,511 | $ | 6,890,645 | $ | 6,824,886 | $ | 6,783,389 | $ | 6,747,659 | |||||
| Common shares outstanding | 51,514 | 51,482 | 51,461 | 51,414 | 51,361 |
| CONSOLIDATED QUARTERLY FINANCIAL DATA | (Unaudited) | ||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES | |||||||||||||||
| (Amounts in thousands) | 4Q'19 | 3Q'19 | 2Q'19 | 1Q'19 | 4Q'18 | ||||||||||
| Credit Analysis | |||||||||||||||
| Net charge-offs (recoveries) - non-acquired loans | $ | 2,930 | $ | 2,106 | $ | 1,621 | $ | 762 | $ | 3,693 | |||||
| Net charge-offs (recoveries) - acquired loans | 295 | 5 | 220 | 201 | 56 | ||||||||||
| Total Net Charge-offs (Recoveries) | 3,225 | 2,111 | 1,841 | 963 | 3,749 | ||||||||||
| TDR valuation adjustments | $ | 27 | $ | 40 | $ | 27 | $ | 35 | $ | 35 | |||||
| Net charge-offs (recoveries) to average loans - non-acquired loans | 0.23 | % | 0.17 | % | 0.13 | % | 0.06 | % | 0.32 | % | |||||
| Net charge-offs (recoveries) to average loans - acquired loans | 0.02 | — | 0.02 | 0.02 | — | ||||||||||
| Total Net Charge-offs (Recoveries) to Average Loans | 0.25 | 0.17 | 0.15 | 0.08 | 0.32 | ||||||||||
| Provision for loan losses - non-acquired loans | $ | 4,041 | $ | 2,241 | $ | 2,326 | $ | 1,709 | $ | 2,343 | |||||
| Provision for (recapture of) loan losses - acquired loans | 759 | 10 | 225 | (312 | ) | (1 | ) | ||||||||
| Total Provision for Loan Losses | $ | 4,800 | $ | 2,251 | $ | 2,551 | $ | 1,397 | $ | 2,342 | |||||
| Allowance for loan losses - non-acquired loans | $ | 34,573 | $ | 33,488 | $ | 33,393 | $ | 32,715 | $ | 31,803 | |||||
| Allowance for loan losses - acquired loans | 581 | 117 | 112 | 107 | 620 | ||||||||||
| Total Allowance for Loan Losses | $ | 35,154 | $ | 33,605 | $ | 33,505 | $ | 32,822 | $ | 32,423 | |||||
| Non-acquired loans at end of period | $ | 4,317,919 | $ | 4,010,299 | $ | 3,817,358 | $ | 3,667,221 | $ | 3,588,251 | |||||
| Purchased noncredit impaired loans at end of period | 867,819 | 962,609 | 1,057,200 | 1,147,432 | 1,222,529 | ||||||||||
| Purchased credit impaired loans at end of period | 12,666 | 13,381 | 13,581 | 13,788 | 14,434 | ||||||||||
| Total Loans | $ | 5,198,404 | $ | 4,986,289 | $ | 4,888,139 | $ | 4,828,441 | $ | 4,825,214 | |||||
| Non-acquired loans allowance for loan losses to non-acquired loans at end of period | 0.80 | % | 0.84 | % | 0.87 | % | 0.89 | % | 0.89 | % | |||||
| Total allowance for loan losses to total loans at end of period | 0.68 | 0.67 | 0.69 | 0.68 | 0.67 | ||||||||||
| Purchase discount on acquired loans at end of period | 3.83 | 3.76 | 3.76 | 3.80 | 3.86 | ||||||||||
| End of Period | |||||||||||||||
| Nonperforming loans - non-acquired | $ | 20,990 | $ | 20,400 | $ | 15,810 | $ | 15,423 | $ | 15,783 | |||||
| Nonperforming loans - acquired | 5,965 | 5,644 | 6,986 | 6,990 | 10,693 | ||||||||||
| Other real estate owned - non-acquired | 5,177 | 5,177 | 66 | 831 | 386 | ||||||||||
| Other real estate owned - acquired | 372 | 1,574 | 1,612 | 1,725 | 3,020 | ||||||||||
| Bank branches closed included in other real estate owned | 6,842 | 6,842 | 9,365 | 9,365 | 9,396 | ||||||||||
| Total Nonperforming Assets | $ | 39,346 | $ | 39,637 | $ | 33,839 | $ | 34,334 | $ | 39,278 | |||||
| Restructured loans (accruing) | $ | 11,100 | $ | 12,395 | $ | 14,534 | $ | 14,857 | $ | 13,346 | |||||
| Nonperforming loans to loans at end of period - non-acquired | 0.49 | % | 0.51 | % | 0.41 | % | 0.42 | % | 0.44 | % | |||||
| Nonperforming loans to loans at end of period - acquired | 0.68 | 0.58 | 0.65 | 0.60 | 0.86 | ||||||||||
| Total Nonperforming Loans to Loans at End of Period | 0.52 | 0.52 | 0.47 | 0.46 | 0.55 | ||||||||||
| Nonperforming assets to total assets - non-acquired | 0.46 | % | 0.47 | % | 0.37 | % | 0.38 | % | 0.38 | % | |||||
| Nonperforming assets to total assets - acquired | 0.09 | 0.11 | 0.13 | 0.13 | 0.20 | ||||||||||
| Total Nonperforming Assets to Total Assets | 0.55 | 0.58 | 0.50 | 0.51 | 0.58 | ||||||||||
| December 31, | September 30, | June 30, | March 31, | December 31, | |||||||||||
| Loans | 2019 | 2019 | 2019 | 2019 | 2018 | ||||||||||
| Construction and land development | $ | 325,113 | $ | 326,324 | $ | 379,991 | $ | 417,565 | $ | 443,568 | |||||
| Commercial real estate - owner occupied | 1,034,963 | 1,025,040 | 1,005,876 | 989,234 | 970,181 | ||||||||||
| Commercial real estate - non-owner occupied | 1,344,008 | 1,285,327 | 1,184,409 | 1,173,183 | 1,161,885 | ||||||||||
| Residential real estate | 1,507,863 | 1,409,946 | 1,400,184 | 1,329,166 | 1,324,377 | ||||||||||
| Consumer | 208,205 | 217,366 | 215,932 | 206,414 | 202,881 | ||||||||||
| Commercial and financial | 778,252 | 722,286 | 701,747 | 712,879 | 722,322 | ||||||||||
| Total Loans | $ | 5,198,404 | $ | 4,986,289 | $ | 4,888,139 | $ | 4,828,441 | $ | 4,825,214 |
| AVERAGE BALANCES, INTEREST INCOME AND EXPENSES, YIELDS AND RATES ^1^ | (Unaudited) | ||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES | |||||||||||||||||||||
| 4Q'19 | 3Q'19 | 4Q'18 | |||||||||||||||||||
| Average | Yield/ | Average | Yield/ | Average | Yield/ | ||||||||||||||||
| (Amounts in thousands) | Balance | Interest | Rate | Balance | Interest | Rate | Balance | Interest | Rate | ||||||||||||
| Assets | |||||||||||||||||||||
| Earning assets: | |||||||||||||||||||||
| Securities: | |||||||||||||||||||||
| Taxable | $ | 1,179,843 | $ | 8,500 | 2.88 | % | $ | 1,171,393 | $ | 8,802 | 3.01 | % | $ | 1,227,648 | $ | 9,528 | 3.10 | % | |||
| Nontaxable | 20,709 | 162 | 3.13 | 21,194 | 164 | 3.09 | 29,255 | 252 | 3.45 | ||||||||||||
| Total Securities | 1,200,552 | 8,662 | 2.89 | 1,192,587 | 8,966 | 3.01 | 1,256,903 | 9,780 | 3.11 | ||||||||||||
| Federal funds sold and other | |||||||||||||||||||||
| investments | 84,961 | 788 | 3.68 | 84,705 | 800 | 3.75 | 87,146 | 835 | 3.80 | ||||||||||||
| Loans, net | 5,104,272 | 62,922 | 4.89 | 4,945,953 | 63,138 | 5.06 | 4,611,691 | 59,559 | 5.12 | ||||||||||||
| Total Earning Assets | 6,389,785 | 72,372 | 4.49 | 6,223,245 | 72,904 | 4.65 | 5,955,740 | 70,174 | 4.67 | ||||||||||||
| Allowance for loan losses | (34,072 | ) | (33,997 | ) | (33,864 | ) | |||||||||||||||
| Cash and due from banks | 99,008 | 88,539 | 124,299 | ||||||||||||||||||
| Premises and equipment | 67,485 | 68,301 | 75,120 | ||||||||||||||||||
| Intangible assets | 226,060 | 227,389 | 213,713 | ||||||||||||||||||
| Bank owned life insurance | 125,597 | 125,249 | 132,495 | ||||||||||||||||||
| Other assets | 122,351 | 121,850 | 122,367 | ||||||||||||||||||
| Total Assets | $ | 6,996,214 | $ | 6,820,576 | $ | 6,589,870 | |||||||||||||||
| Liabilities and Shareholders' Equity | |||||||||||||||||||||
| Interest-bearing liabilities: | |||||||||||||||||||||
| Interest-bearing demand | $ | 1,190,681 | $ | 983 | 0.33 | % | $ | 1,116,434 | $ | 1,053 | 0.37 | % | $ | 974,711 | $ | 515 | 0.21 | % | |||
| Savings | 528,771 | 422 | 0.32 | 522,831 | 531 | 0.40 | 509,434 | 418 | 0.33 | ||||||||||||
| Money market | 1,148,453 | 2,184 | 0.75 | 1,173,042 | 2,750 | 0.93 | 1,161,599 | 2,207 | 0.75 | ||||||||||||
| Time deposits | 1,078,297 | 5,084 | 1.87 | 1,159,272 | 6,009 | 2.06 | 899,153 | 3,901 | 1.72 | ||||||||||||
| Securities sold under agreements to repurchase | 73,693 | 226 | 1.22 | 75,785 | 300 | 1.57 | 242,963 | 732 | 1.20 | ||||||||||||
| Federal funds purchased and <br>Federal Home Loan Bank borrowings | 181,134 | 845 | 1.85 | 68,804 | 414 | 2.39 | 240,799 | 1,468 | 2.42 | ||||||||||||
| Other borrowings | 71,045 | 782 | 4.37 | 70,969 | 820 | 4.58 | 70,764 | 833 | 4.67 | ||||||||||||
| Total Interest-Bearing Liabilities | 4,272,074 | 10,526 | 0.98 | 4,187,137 | 11,877 | 1.13 | 4,099,423 | 10,074 | 0.97 | ||||||||||||
| Noninterest demand | 1,680,734 | 1,626,269 | 1,628,842 | ||||||||||||||||||
| Other liabilities | 67,206 | 60,500 | 33,846 | ||||||||||||||||||
| Total Liabilities | 6,020,014 | 5,873,906 | 5,762,111 | ||||||||||||||||||
| Shareholders' equity | 976,200 | 946,670 | 827,759 | ||||||||||||||||||
| Total Liabilities & Equity | $ | 6,996,214 | $ | 6,820,576 | $ | 6,589,870 | |||||||||||||||
| Cost of deposits | 0.61 | % | 0.73 | % | 0.54 | % | |||||||||||||||
| Interest expense as a % of earning assets | 0.65 | % | 0.76 | % | 0.67 | % | |||||||||||||||
| Net interest income as a % of earning assets | $ | 61,846 | 3.84 | % | $ | 61,027 | 3.89 | % | $ | 60,100 | 4.00 | % | |||||||||
| ^1^On 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. |
| AVERAGE BALANCES, INTEREST INCOME AND EXPENSES, YIELDS AND RATES ^1^ | (Unaudited) | ||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES | |||||||||||||||
| Twelve Months Ended December 31, 2019 | Twelve Months Ended December 31, 2018 | ||||||||||||||
| Average | Yield/ | Average | Yield/ | ||||||||||||
| (Amounts in thousands, except ratios) | Balance | Interest | Rate | Balance | Interest | Rate | |||||||||
| Assets | |||||||||||||||
| Earning assets: | |||||||||||||||
| Securities: | |||||||||||||||
| Taxable | $ | 1,176,842 | $ | 35,354 | 3.00 | % | $ | 1,299,089 | $ | 37,860 | 2.91 | % | |||
| Nontaxable | 23,122 | 695 | 3.01 | 31,331 | 1,115 | 3.56 | |||||||||
| Total Securities | 1,199,964 | 36,049 | 3.00 | 1,330,420 | 38,975 | 2.93 | |||||||||
| Federal funds sold and other | |||||||||||||||
| investments | 88,045 | 3,379 | 3.84 | 61,048 | 2,670 | 4.37 | |||||||||
| Loans, net | 4,933,518 | 250,730 | 5.08 | 4,112,009 | 200,194 | 4.87 | |||||||||
| Total Earning Assets | 6,221,527 | 290,158 | 4.66 | 5,503,477 | 241,839 | 4.39 | |||||||||
| Allowance for loan losses | (33,465 | ) | (29,972 | ) | |||||||||||
| Cash and due from banks | 94,643 | 114,936 | |||||||||||||
| Premises and equipment | 69,142 | 67,332 | |||||||||||||
| Intangible assets | 228,042 | 178,287 | |||||||||||||
| Bank owned life insurance | 124,803 | 124,452 | |||||||||||||
| Other assets | 126,588 | 98,823 | |||||||||||||
| Total Assets | $ | 6,831,280 | $ | 6,057,335 | |||||||||||
| Liabilities and Shareholders' Equity | |||||||||||||||
| Interest-bearing liabilities: | |||||||||||||||
| Interest-bearing demand | $ | 1,114,334 | $ | 4,025 | 0.36 | % | $ | 978,030 | $ | 1,883 | 0.19 | % | |||
| Savings | 516,526 | 2,015 | 0.39 | 457,542 | 811 | 0.18 | |||||||||
| Money market | 1,164,938 | 10,581 | 0.91 | 1,049,900 | 6,069 | 0.58 | |||||||||
| Time deposits | 1,092,516 | 21,776 | 1.99 | 811,741 | 11,684 | 1.44 | |||||||||
| Securities sold under agreements to repurchase | 106,142 | 1,431 | 1.35 | 200,839 | 1,804 | 0.90 | |||||||||
| Federal funds purchased and <br>Federal Home Loan Bank borrowings | 131,921 | 3,010 | 2.28 | 224,982 | 4,468 | 1.99 | |||||||||
| Other borrowings | 70,939 | 3,367 | 4.75 | 70,658 | 3,164 | 4.48 | |||||||||
| Total Interest-Bearing Liabilities | 4,197,316 | 46,205 | 1.10 | 3,793,692 | 29,883 | 0.79 | |||||||||
| Noninterest demand | 1,641,766 | 1,492,451 | |||||||||||||
| Other liabilities | 63,405 | 30,621 | |||||||||||||
| Total Liabilities | 5,902,487 | 5,316,764 | |||||||||||||
| Shareholders' equity | 928,793 | 740,571 | |||||||||||||
| Total Liabilities & Equity | $ | 6,831,280 | $ | 6,057,335 | |||||||||||
| Cost of deposits | 0.69 | % | 0.43 | % | |||||||||||
| Interest expense as a % of earning assets | 0.74 | % | 0.54 | % | |||||||||||
| Net interest income as a % of earning assets | $ | 243,953 | 3.92 | % | $ | 211,956 | 3.85 | % | |||||||
| ^1^On 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 | |||||||||||
| December 31, | September 30, | June 30, | March 31, | December 31, | |||||||
| (Amounts in thousands) | 2019 | 2019 | 2019 | 2019 | 2018 | ||||||
| Customer Relationship Funding | |||||||||||
| Noninterest demand | |||||||||||
| Commercial | $ | 1,233,475 | $ | 1,314,102 | $ | 1,323,743 | $ | 1,298,468 | $ | 1,217,842 | |
| Retail | 246,717 | 241,734 | 251,879 | 275,383 | 259,318 | ||||||
| Public funds | 85,122 | 65,869 | 65,822 | 73,640 | 68,324 | ||||||
| Other | 25,179 | 31,222 | 28,360 | 28,518 | 24,118 | ||||||
| Total Noninterest Demand | 1,590,493 | 1,652,927 | 1,669,804 | 1,676,009 | 1,569,602 | ||||||
| Interest-bearing demand | |||||||||||
| Commercial | 319,993 | 342,376 | 323,818 | 289,544 | 211,879 | ||||||
| Retail | 641,762 | 622,833 | 634,099 | 646,522 | 650,490 | ||||||
| Public funds | 219,977 | 150,246 | 166,602 | 164,411 | 151,663 | ||||||
| Total Interest-Bearing Demand | 1,181,732 | 1,115,455 | 1,124,519 | 1,100,477 | 1,014,032 | ||||||
| Total transaction accounts | |||||||||||
| Commercial | 1,553,468 | 1,656,478 | 1,647,561 | 1,588,012 | 1,429,721 | ||||||
| Retail | 888,479 | 864,567 | 885,978 | 921,905 | 909,808 | ||||||
| Public funds | 305,099 | 216,115 | 232,424 | 238,051 | 219,987 | ||||||
| Other | 25,179 | 31,222 | 28,360 | 28,518 | 24,118 | ||||||
| Total Transaction Accounts | 2,772,225 | 2,768,382 | 2,794,323 | 2,776,486 | 2,583,634 | ||||||
| Savings | 519,152 | 528,214 | 519,732 | 508,320 | 493,807 | ||||||
| Money market | |||||||||||
| Commercial | 494,803 | 513,477 | 517,041 | 500,649 | 459,380 | ||||||
| Retail | 553,075 | 583,917 | 590,320 | 602,378 | 607,837 | ||||||
| Public funds | 60,485 | 61,468 | 65,610 | 89,043 | 106,733 | ||||||
| Total Money Market | 1,108,363 | 1,158,862 | 1,172,971 | 1,192,070 | 1,173,950 | ||||||
| Brokered time certificates | 472,857 | 458,418 | 268,998 | 367,841 | 220,594 | ||||||
| Other time certificates | 712,156 | 759,265 | 785,185 | 760,861 | 705,255 | ||||||
| 1,185,013 | 1,217,683 | 1,054,183 | 1,128,702 | 925,849 | |||||||
| Total Deposits | $ | 5,584,753 | $ | 5,673,141 | $ | 5,541,209 | $ | 5,605,578 | $ | 5,177,240 | |
| Customer sweep accounts | $ | 86,121 | $ | 70,414 | $ | 82,015 | $ | 148,005 | $ | 214,323 |
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 | Twelve Months Ended | ||||||||||||||||||||
| (Amounts in thousands, except per share data) | 4Q'19 | 3Q'19 | 2Q'19 | 1Q'19 | 4Q'18 | 4Q'19 | 4Q'18 | ||||||||||||||
| Net Income | $ | 27,176 | $ | 25,605 | $ | 23,253 | $ | 22,705 | $ | 15,962 | $ | 98,739 | $ | 67,275 | |||||||
| Total noninterest income | 16,376 | 13,943 | 13,577 | 12,836 | 12,714 | 56,732 | 50,022 | ||||||||||||||
| Securities (gains)/losses, net | (2,539 | ) | 847 | 466 | 9 | 425 | (1,217 | ) | 623 | ||||||||||||
| BOLI benefits on death (included in other income) | — | (956 | ) | — | — | (280 | ) | (956 | ) | (280 | ) | ||||||||||
| Total Adjustments to Noninterest Income | (2,539 | ) | (109 | ) | 466 | 9 | 145 | (2,173 | ) | 343 | |||||||||||
| Total Adjusted Noninterest Income | 13,837 | 13,834 | 14,043 | 12,845 | 12,859 | 54,559 | 50,365 | ||||||||||||||
| Total noninterest expense | 38,057 | 38,583 | 41,000 | 43,099 | 49,464 | 160,739 | 162,273 | ||||||||||||||
| Merger related charges | (634 | ) | — | — | (335 | ) | (8,034 | ) | (969 | ) | (9,681 | ) | |||||||||
| Amortization of intangibles | (1,456 | ) | (1,456 | ) | (1,456 | ) | (1,458 | ) | (1,303 | ) | (5,826 | ) | (4,300 | ) | |||||||
| Business continuity expenses - hurricane events | — | (95 | ) | — | — | — | (95 | ) | — | ||||||||||||
| Branch reductions and other expense initiatives | — | (121 | ) | (1,517 | ) | (208 | ) | (587 | ) | (1,846 | ) | (587 | ) | ||||||||
| Total Adjustments to Noninterest Expense | (2,090 | ) | (1,672 | ) | (2,973 | ) | (2,001 | ) | (9,924 | ) | (8,736 | ) | (14,568 | ) | |||||||
| Total Adjusted Noninterest Expense | 35,967 | 36,911 | 38,027 | 41,098 | 39,540 | 152,003 | 147,705 | ||||||||||||||
| Income Taxes | 8,103 | 8,452 | 6,909 | 6,409 | 4,930 | 29,873 | 20,259 | ||||||||||||||
| Tax effect of adjustments | (110 | ) | 572 | 874 | 510 | 2,623 | 1,846 | 3,834 | |||||||||||||
| Taxes and tax penalties on acquisition-related BOLI redemption | — | — | — | — | (485 | ) | — | (485 | ) | ||||||||||||
| Effect of change in corporate tax rate on deferred tax assets | — | (1,135 | ) | — | — | — | (1,135 | ) | (248 | ) | |||||||||||
| Total Adjustments to Income Taxes | (110 | ) | (563 | ) | 874 | 510 | 2,138 | 711 | 3,101 | ||||||||||||
| Adjusted Income Taxes | 7,993 | 7,889 | 7,783 | 6,919 | 7,068 | 30,584 | 23,360 | ||||||||||||||
| Adjusted Net Income | $ | 26,837 | $ | 27,731 | $ | 25,818 | $ | 24,205 | $ | 23,893 | $ | 104,591 | $ | 79,085 | |||||||
| Earnings per diluted share, as reported | $ | 0.52 | $ | 0.49 | $ | 0.45 | $ | 0.44 | $ | 0.31 | $ | 1.90 | $ | 1.38 | |||||||
| Adjusted Earnings per Diluted Share | 0.52 | 0.53 | 0.50 | 0.47 | 0.47 | 2.01 | 1.62 | ||||||||||||||
| Average diluted shares outstanding | 52,081 | 51,935 | 51,952 | 52,039 | 51,237 | 52,029 | 48,748 | ||||||||||||||
| Adjusted Noninterest Expense | $ | 35,967 | $ | 36,911 | $ | 38,027 | $ | 41,098 | $ | 39,540 | $ | 152,003 | $ | 147,705 | |||||||
| Foreclosed property expense and net gain/(loss) on sale | (3 | ) | (262 | ) | 174 | 40 | — | (51 | ) | (460 | ) | ||||||||||
| Net Adjusted Noninterest Expense | $ | 35,964 | $ | 36,649 | $ | 38,201 | $ | 41,138 | $ | 39,540 | $ | 151,952 | $ | 147,245 | |||||||
| Revenue | $ | 78,136 | $ | 74,891 | $ | 73,713 | $ | 73,610 | $ | 72,698 | $ | 300,350 | $ | 261,537 | |||||||
| Total Adjustments to Revenue | (2,539 | ) | (109 | ) | 466 | 9 | 145 | (2,173 | ) | 343 | |||||||||||
| Impact of FTE adjustment | 87 | 79 | 83 | 87 | 116 | 336 | 441 | ||||||||||||||
| Adjusted Revenue on a fully taxable equivalent basis | $ | 75,684 | $ | 74,861 | $ | 74,262 | $ | 73,706 | $ | 72,959 | $ | 298,513 | $ | 262,321 | |||||||
| Adjusted Efficiency Ratio | 47.52 | % | 48.96 | % | 51.44 | % | 55.81 | % | 54.19 | % | 50.90 | % | 56.13 | % | |||||||
| Average Assets | $ | 6,996,214 | $ | 6,820,576 | $ | 6,734,994 | $ | 6,770,978 | $ | 6,589,870 | $ | 6,831,280 | $ | 6,057,335 | |||||||
| Less average goodwill and intangible assets | (226,060 | ) | (227,389 | ) | (228,706 | ) | (230,066 | ) | (213,713 | ) | (228,042 | ) | (178,287 | ) | |||||||
| Average Tangible Assets | $ | 6,770,154 | $ | 6,593,187 | $ | 6,506,288 | $ | 6,540,912 | $ | 6,376,157 | $ | 6,603,238 | $ | 5,879,048 | |||||||
| Return on Average Assets (ROA) | 1.54 | % | 1.49 | % | 1.38 | % | 1.36 | % | 0.96 | % | 1.45 | % | 1.11 | % | |||||||
| Impact of removing average intangible assets and related amortization | 0.12 | 0.12 | 0.12 | 0.12 | 0.09 | 0.11 | 0.09 | ||||||||||||||
| Return on Average Tangible Assets (ROTA) | 1.66 | 1.61 | 1.50 | 1.48 | 1.05 | 1.56 | 1.20 | ||||||||||||||
| Impact of other adjustments for Adjusted Net Income | (0.09 | ) | 0.06 | 0.09 | 0.02 | 0.44 | 0.02 | 0.15 | |||||||||||||
| Adjusted Return on Average Tangible Assets | 1.57 | 1.67 | 1.59 | 1.50 | 1.49 | 1.58 | 1.35 | ||||||||||||||
| Average Shareholders' Equity | $ | 976,200 | $ | 946,670 | $ | 911,479 | $ | 879,564 | $ | 827,759 | $ | 928,793 | $ | 740,571 | |||||||
| Less average goodwill and intangible assets | (226,060 | ) | (227,389 | ) | (228,706 | ) | (230,066 | ) | (213,713 | ) | (228,042 | ) | (178,287 | ) | |||||||
| Average Tangible Equity | $ | 750,140 | $ | 719,281 | $ | 682,773 | $ | 649,498 | $ | 614,046 | $ | 700,751 | $ | 562,284 | |||||||
| Return on Average Shareholders' Equity | 11.04 | % | 10.73 | % | 10.23 | % | 10.47 | % | 7.65 | % | 10.63 | % | 9.08 | % | |||||||
| Impact of removing average intangible assets and related amortization | 3.91 | 4.00 | 4.07 | 4.39 | 3.29 | 4.09 | 3.46 | ||||||||||||||
| Return on Average Tangible Common Equity (ROTCE) | 14.95 | 14.73 | 14.30 | 14.86 | 10.94 | 14.72 | 12.54 | ||||||||||||||
| Impact of other adjustments for Adjusted Net Income | (0.76 | ) | 0.57 | 0.87 | 0.25 | 4.50 | 0.21 | 1.52 | |||||||||||||
| Adjusted Return on Average Tangible Common Equity | 14.19 | 15.30 | 15.17 | 15.11 | 15.44 | 14.93 | 14.06 | ||||||||||||||
| Loan interest income excluding accretion on acquired loans | $ | 59,515 | $ | 59,279 | $ | 58,169 | $ | 58,397 | $ | 55,470 | $ | 235,359 | $ | 188,865 | |||||||
| Accretion on acquired loans | 3,407 | 3,859 | 4,166 | 3,938 | 4,089 | 15,371 | 11,329 | ||||||||||||||
| Loan interest income^1^ | $ | 62,922 | $ | 63,138 | $ | 62,335 | $ | 62,335 | $ | 59,559 | $ | 250,730 | $ | 200,194 | |||||||
| ^1^On a fully taxable equivalent basis. All yields and rates have been computed using amortized cost. |
| GAAP TO NON-GAAP RECONCILIATION | (Unaudited) | ||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES | |||||||||||||||||||||
| Quarterly Trends | Twelve Months Ended | ||||||||||||||||||||
| (Amounts in thousands, except per share data) | 4Q'19 | 3Q'19 | 2Q'19 | 1Q'19 | 4Q'18 | 4Q'19 | 4Q'18 | ||||||||||||||
| Yield on loans excluding accretion on acquired loans | 4.63 | % | 4.76 | % | 4.82 | % | 4.89 | % | 4.77 | % | 4.77 | % | 4.59 | % | |||||||
| Impact of accretion on acquired loans | 0.26 | 0.30 | 0.34 | 0.33 | 0.35 | 0.31 | 0.28 | ||||||||||||||
| Yield on loans | 4.89 | 5.06 | 5.16 | 5.22 | 5.12 | 5.08 | 4.87 | ||||||||||||||
| Net interest income excluding accretion on acquired loans | $ | 58,439 | $ | 57,168 | $ | 56,053 | $ | 56,923 | $ | 56,011 | $ | 228,582 | $ | 200,627 | |||||||
| Accretion on acquired loans | 3,407 | 3,859 | 4,166 | 3,938 | 4,089 | 15,371 | 11,329 | ||||||||||||||
| Net Interest Income^1^ | $ | 61,846 | $ | 61,027 | $ | 60,219 | $ | 60,861 | $ | 60,100 | $ | 243,953 | $ | 211,956 | |||||||
| Net interest margin excluding accretion on acquired loans | 3.63 | % | 3.64 | % | 3.67 | % | 3.76 | % | 3.73 | % | 3.67 | % | 3.65 | % | |||||||
| Impact of accretion on acquired loans | 0.21 | 0.25 | 0.27 | 0.26 | 0.27 | 0.25 | 0.20 | ||||||||||||||
| Net Interest Margin | 3.84 | 3.89 | 3.94 | 4.02 | 4.00 | 3.92 | 3.85 | ||||||||||||||
| Security interest income excluding tax equivalent adjustment | $ | 8,630 | $ | 8,933 | $ | 9,076 | $ | 9,270 | $ | 9,728 | $ | 35,909 | $ | 38,743 | |||||||
| Tax equivalent adjustment on securities | 32 | 33 | 36 | 39 | 52 | 140 | 232 | ||||||||||||||
| Security interest income^1^ | $ | 8,662 | $ | 8,966 | $ | 9,112 | $ | 9,309 | $ | 9,780 | $ | 36,049 | $ | 38,975 | |||||||
| Loan interest income excluding tax equivalent adjustment | $ | 62,867 | $ | 63,091 | $ | 62,287 | $ | 62,287 | $ | 59,495 | $ | 250,532 | $ | 199,984 | |||||||
| Tax equivalent adjustment on loans | 55 | 47 | 48 | 48 | 64 | 198 | 210 | ||||||||||||||
| Loan interest income^1^ | $ | 62,922 | $ | 63,138 | $ | 62,335 | $ | 62,335 | $ | 59,559 | $ | 250,730 | $ | 200,194 | |||||||
| Net interest income excluding tax equivalent adjustment | $ | 61,759 | $ | 60,947 | $ | 60,135 | $ | 60,774 | $ | 59,984 | $ | 243,615 | $ | 211,514 | |||||||
| Tax equivalent adjustment on securities | 32 | 33 | 36 | 39 | 52 | 140 | 232 | ||||||||||||||
| Tax equivalent adjustment on loans | 55 | 47 | 48 | 48 | 64 | 198 | 210 | ||||||||||||||
| Net Interest Income^1^ | $ | 61,846 | $ | 61,027 | $ | 60,219 | $ | 60,861 | $ | 60,100 | $ | 243,953 | $ | 211,956 | |||||||
| ^1^On a fully taxable equivalent basis. All yields and rates have been computed using amortized cost. |
sbcf4q2019earningspresen
Earnings Presentation FOURTH QUARTER 2019 RESULTS Contact: (email) Chuck.Shaffer@SeacoastBank.com (phone) 772.221.7003 (web) www.SeacoastBanking.com
Cautionary Notice Regarding Forward-Looking Statements This press release contains “forward-looking statements” within the meaning, and protections, of Section of assumptions and estimates, as well as differences in, and changes to, economic, market and credit 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including, conditions; the impact on the valuation of our investments due to market volatility or counterparty without limitation, statements about future financial and operating results, cost savings, enhanced payment risk; statutory and regulatory dividend restrictions; increases in regulatory capital requirements revenues, economic and seasonal conditions in our markets, new initiatives and improvements to for banking organizations generally; the risks of mergers, acquisitions and divestitures, including our reported earnings that may be realized from cost controls, tax law changes, and for integration of banks ability to continue to identify acquisition targets and successfully acquire desirable financial institutions; that we have acquired, or expect to acquire, as well as statements with respect to Seacoast's objectives, changes in technology or products that may be more difficult, costly, or less effective than anticipated; strategic plans, including Vision 2020, expectations and intentions and other statements that are not our ability to identify and address increased cybersecurity risks; inability of our risk management historical facts. Actual results may differ from those set forth in the forward-looking statements. framework to manage risks associated with our business; dependence on key suppliers or vendors to obtain equipment or services for our business on acceptable terms; reduction in or the termination of Forward-looking statements include statements with respect to our beliefs, plans, objectives, goals, our ability to use the mobile-based platform that is critical to our business growth strategy; the effects expectations, anticipations, assumptions, estimates and intentions about future performance, and of war or other conflicts, acts of terrorism, natural disasters or other catastrophic events that may affect involve known and unknown risks, uncertainties and other factors, which may be beyond our control, general economic conditions; unexpected outcomes of, and the costs associated with, existing or new and which may cause the actual results, performance or achievements of Seacoast to be materially litigation involving us; our ability to maintain adequate internal controls over financial reporting; potential different from future results, performance or achievements expressed or implied by such forward-looking claims, damages, penalties, fines and reputational damage resulting from pending or future litigation, statements. You should not expect us to update any forward-looking statements. regulatory proceedings and enforcement actions; the risks that our deferred tax assets could be reduced if estimates of future taxable income from our operations and tax planning strategies are less than All statements other than statements of historical fact could be forward-looking statements. You can currently estimated and sales of our capital stock could trigger a reduction in the amount of net operating identify these forward-looking statements through our use of words such as “may”, “will”, “anticipate”, loss carryforwards that we may be able to utilize for income tax purposes; the effects of competition “assume”, “should”, “support”, “indicate”, “would”, “believe”, “contemplate”, “expect”, “estimate”, from other commercial banks, thrifts, mortgage banking firms, consumer finance companies, credit “continue”, “further”, “plan”, “point to”, “project”, “could”, “intend”, “target” or other similar words and unions, securities brokerage firms, insurance companies, money market and other mutual funds and expressions of the future. These forward-looking statements may not be realized due to a variety of other financial institutions operating in our market areas and elsewhere, including institutions operating factors, including, without limitation: the effects of future economic and market conditions, including regionally, nationally and internationally, together with such competitors offering banking products and seasonality; governmental monetary and fiscal policies, including interest rate policies of the Board of services by mail, telephone, computer and the Internet; and the failure of assumptions underlying the Governors of the Federal Reserve, as well as legislative, tax and regulatory changes; changes in accounting establishment of reserves for possible loan losses. policies, rules and practices; the risks of changes in interest rates on the level and composition of deposits, loan demand, liquidity and the values of loan collateral, securities, and interest sensitive assets and All written or oral forward-looking statements attributable to us are expressly qualified in their entirety liabilities; interest rate risks, sensitivities and the shape of the yield curve; uncertainty related to the by this cautionary notice, including, without limitation, those risks and uncertainties described in our impact of LIBOR calculations on securities and loans; changes in borrower credit risks and payment annual report on Form 10-K for the year ended December 31, 2018 under “Special Cautionary Notice behaviors; changes in the availability and cost of credit and capital in the financial markets; changes in Regarding Forward-Looking Statements” and “Risk Factors”, and otherwise in our SEC reports and filings. the prices, values and sales volumes of residential and commercial real estate; our ability to comply with Such reports are available upon request from the Company, or from the Securities and Exchange any regulatory requirements; the effects of problems encountered by other financial institutions that Commission, including through the SEC’s Internet website at www.sec.gov. adversely affect us or the banking industry; our concentration in commercial real estate loans; the failure FOURTH QUARTER 2019 EARNINGS PRESENTATION 2
Seacoast Has a Valuable and Growing Florida Franchise Seacoast Customer Map • $7.1 billion in assets as of • Highly disciplined credit portfolio December 31, 2019, operating in the nation’s third-most populous state • Prudent liquidity position • Strong and growing presence in four of Florida’s most attractive MSAs • Strong capital position • #1 Florida-based bank in the Orlando MSA • Steady increase in shareholder value • Growing share in West Palm Beach with tangible book value per share increasing 20% year-over-year • #2 share in Port St Lucie MSA • Growing presence in Tampa MSA • Active board with a diverse range of • Market Cap: $1.6 billion as of experience and expertise December 31, 2019 Valuable Florida Franchise with Disciplined Growth Strategy, Benefiting from Fortress Balance Sheet with Robust Capital Generation, Prudent Liquidity Position, and Strict Credit Underwriting FOURTH QUARTER 2019 EARNINGS PRESENTATION 3
Fourth Quarter Highlights • Net income for the fourth quarter of 2019 was $27.2 million, an increase of 6% compared to the third quarter of 2019 and 70% compared to the fourth quarter of 2018. For the year ended December 31, 2019, net income was $98.7 million, or $1.90 per diluted share, compared to $67.3 million, or $1.38, for the year ended December 31, 2018. • Adjusted net income1 for the fourth quarter of 2019 was $26.8 million, a decrease of 3% compared to the third quarter of 2019 and an increase of 12% compared to the fourth quarter of 2018. For the year ended December 31, 2019, adjusted net income1 was $104.6 million, or $2.01 per diluted share, compared to $79.1 million, or $1.62, for the year ended December 31, 2018. • Earnings per diluted share totaled $0.52 on a GAAP basis and $0.52 on an adjusted basis1 for the quarter. • On a GAAP basis, the quarter ended at 1.66% Return on Tangible Assets (ROTA) and 15.0% Return on Average Tangible Common Equity (ROTCE). On an adjusted basis, fourth quarter results were 1.57% adjusted ROTA1 and 14.2% adjusted ROTCE1. • Steadily building shareholder value through consistent growth in tangible book value per share, ending the period at $14.76, an increase of 20% compared to the prior year. • Efficiency ratio improved to 48.4% compared to 48.6% in the prior quarter and 65.8% in the fourth quarter of 2018. The adjusted efficiency ratio1 improved to 47.5% compared to 49.0% in the prior quarter and 54.2% in the fourth quarter of 2018. • Full year adjusted revenues1 increased 14% compared to the prior year while adjusted noninterest expense1 increased 3%, generating 11% operating leverage. • New loan originations were $587 million compared to $488 million in the prior quarter, resulting in net loan growth of 17% on an annualized basis. • Cost of deposits declined to 0.61% from 0.73% in the prior quarter and transaction accounts grew 7% year-over-year, reflecting continued growth in core customer balances. FOURTH QUARTER 2019 EARNINGS PRESENTATION 1Non-GAAP measure, see “Explanation of Certain Unaudited Non-GAAP Financial Measures" for more information and a reconciliation to GAAP 4
Net Interest Income1 and Margin ($ In Thousands) $60,100 $60,861 $60,219 $61,027 $61,846 4.00% 4.02% 3.94% 3.89% 3.84% 3.73% 3.76% 3.67% 3.64% 3.63% 4Q'18 1Q'19 2Q'19 3Q'19 4Q'19 Net Interest Income Net Interest Margin NIM, excluding accretion on acquired loans • Net interest income1 totaled $61.8 million, up $0.8 million or 1% from the prior quarter and up $1.7 million or 3% from the fourth quarter of 2018. Net interest margin1 decreased 5 basis points to 3.84% quarter-over-quarter. • Despite a lower rate environment, the net interest margin excluding accretion on acquired loans decreased only 1 basis point. FOURTH QUARTER 2019 EARNINGS PRESENTATION 1Calculated on a fully taxable equivalent basis using amortized cost 5
Noninterest Income 1 Noninterest Income (in thousands) Adjusted Noninterest Income (in thousands) $16,376 $13,834 $13,837 $904 $12,859 $928 $904 $13,943 $1,091 $12,714 $928 $2,394 $2,917 $5,456 $1,091 $2,503 $2,715 $569 $576 $2,570 $569 $519 $2,127 $1,514 $576 $809 $519 $2,127 $1,514 $809 $1,508 $1,632 $1,579 $1,508 $1,632 $1,579 $3,198 $3,206 $3,387 $3,198 $3,206 $3,387 $3,019 $2,978 $2,960 $3,019 $2,978 $2,960 4Q'18 3Q'19 4Q'19 4Q'18 3Q'19 4Q'19 Noninterest income increased $2.4 million sequentially and adjusted noninterest income1 remained flat at $13.8 million sequentially. Changes include: ◦ After a record third quarter boosted by refinance activity, mortgage banking fees decreased $0.6 million in the fourth quarter to $1.5 million. For the full year, mortgage banking fees increased $1.8 million, or 39%, to $6.5 million from the prior year, reflecting our strategic focus on generating saleable volume. ◦ Interchange income increased by $0.2 million, or 6%, in the fourth quarter, and by $1.1 million, or 9%, for the full year, the result of increased transaction activity across a growing customer base. ◦ On a GAAP basis, other income in the fourth quarter of 2019 includes $2.5 million in securities gains, which are excluded from reporting on an adjusted basis. 1Non-GAAP measure, see “Explanation of Certain Unaudited Non-GAAP Financial Measures" for more information and a reconciliation to GAAP 2Other Income includes marine finance fees, swap related income and other fees related to customer activity as well as securities gains of $2.5 FOURTH QUARTER 2019 EARNINGS PRESENTATION million in 4Q'19 , securities losses of $847 thousand in 3Q'19, and securities losses of $425 thousand in 4Q'18. Other Income in 3Q'19 also includes $956 thousand in BOLI death benefits. 6 3Other Income on an adjusted basis includes marine finance fees, swap related income and other fees related to customer activity.
Continued Focus on Disciplined Expense Control Noninterest Expense (in thousands) Adjusted Noninterest Expense1 (in thousands) $49,464 $6,086 $39,540 $36,911 $35,967 $3,668 $5,650 $38,583 $38,057 $4,591 $2,323 $4,875 $6,801 $4,656 $4,910 $1,597 $1,419 $1,648 $2,025 $5,701 $5,414 $5,809 $5,499 $5,430 $5,435 $1,303 $3,452 $3,706 $3,711 $3,645 $3,648 $1,456 $1,456 $25,797 $22,414 $21,603 $21,613 $20,586 $20,595 4Q'18 3Q'19 4Q'19 4Q'18 3Q'19 4Q'19 Noninterest expense decreased $0.5 million and adjusted noninterest expense1 decreased $0.9 million sequentially. Changes quarter-over-quarter include: • Salaries and employee benefits decreased $1.0 million on a combined basis, the result of lower incentive accruals and our continued proven success at focusing on cost control across the franchise. • Legal and professional fees increased $0.4 million, including $0.6 million incurred in the fourth quarter for merger related activities. • Other expenses increased $0.6 million, including increases of $0.3 million in lending-related costs to support increased production and $0.2 million in recruiting and supporting the onboarding of new talent. For the full year, other expenses are down $2.0 million compared to 2018, reflecting our continued focus on efficiency and streamlining operations. 1Non-GAAP measure, see “Explanation of Certain Unaudited Non-GAAP Financial Measures" for more information and a FOURTH QUARTER 2019 EARNINGS PRESENTATION reconciliation to GAAP 2Other Expense includes marketing expenses and other expenses associated with ongoing business operations. 7
Continued Favorable Efficiency Ratio Trend GAAP - Efficiency Adjusted - Efficiency1 74% 71% 66% 64% 65% 62% 61% 61% 59% 58% 58% 58% 57% 57% 57% 57% 56% 56% 53% 53% 54% 51% 49% 48% 49% 48% 6 7 7 7 7 8 8 8 8 9 9 9 9 6 7 7 7 7 8 8 8 8 9 9 9 9 '1 '1 '1 '1 '1 '1 '1 '1 '1 '1 '1 '1 '1 '1 '1 '1 '1 '1 '1 '1 '1 '1 '1 '1 '1 '1 Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q 4 1 2 3 4 1 2 3 4 1 2 3 4 4 1 2 3 4 1 2 3 4 1 2 3 4 • The efficiency ratio improved to 48.4% compared to 48.6% in the prior quarter and 65.8% in the fourth quarter of 2018. • The adjusted efficiency ratio1 improved to 47.5% compared to 49.0% in the prior quarter and 54.2% in the fourth quarter of 2018. • We continue to make improvements in driving top line revenues while focusing on streamlining operations. FOURTH QUARTER 2019 EARNINGS PRESENTATION 1Non-GAAP measure, see “Explanation of Certain Unaudited Non-GAAP Financial Measures" for more information and a reconciliation to GAAP 8
Loan Growth Momentum Continues, Supported by a Strong Florida Economy and Strict Credit Underwriting Total Loans Outstanding ($ in millions) $5,198 • Fourth quarter loans totaled $5.2 billion, an increase $4,986 of $373 million, or 8%, year-over-year. $4,825 $4,828 $4,888 • New loan originations of $587 million, compared to $488 million in the prior quarter, contributed to net loan growth for the quarter of 17% on an annualized 5.22% 5.12% 5.16% 5.06% basis. 4.89% • Exiting the fourth quarter of 2019, pipelines were $256 4.77% 4.89% 4.82% million in commercial, $45 million in consumer and 4.76% 4.63% small business, and $38 million in residential loans. • Declines in loan yield continue to reflect the impact of the lower rate environment, affecting variable-rate loans and resulting in lower add-on rates for new loans originated. 4Q'18 1Q'19 2Q'19 3Q'19 4Q'19 Loans Reported Yield Y i e l d E x c l u d i n g Accretion on Acquired Loans FOURTH QUARTER 2019 EARNINGS PRESENTATION 9
Strong Deposit Franchise Supported by Attractive Markets Deposits Outstanding ($ in millions) $5,673 $5,606 $5,541 $5,585 $5,177 • Total deposits decreased $88 million, or 2%, quarter- $1,129 $1,054 $1,218 $1,185 over-quarter and increased $408 million, or 8%, $926 compared to the fourth quarter of 2018. • Transaction accounts increased 7% year-over-year, $1,701 $1,693 $1,687 $1,628 reflecting continued strong growth in core customer $1,667 balances, and represents 50% of overall deposit funding. • Overall cost of deposits decreased to 61 basis points from 73 basis points in the prior quarter. $2,776 $2,794 $2,768 $2,772 50% • Fourth quarter balances include an increase of $14 $2,584 million in brokered deposits. 4Q'18 1Q'19 2Q'19 3Q'19 4Q'19 Transaction Accounts Savings & Money Market Time Deposits FOURTH QUARTER 2019 EARNINGS PRESENTATION 10
Average Deposit Balances and Cost Deposit Mix and Cost of Deposits Trended Cost of Deposits Fed Funds Cost of Deposits 0.54% 0.67% 0.76% 0.73% 0.61% 10% 9% 9% 9% 9% 2.50% 2.50% 2.50% 20% 20% 20% 20% 21% 2.25% 2.00% 2.00% 1.75% 1.75% 22% 21% 21% 21% 20% 1.50% 1.25% 1.25% 13% 14% 14% 14% 14% 1.00% 4% 6% 6% 7% 6% 0.75% 0.76% 0.73% 0.67% 0.61% 0.50% 0.54% 0.39% 0.43% 31% 30% 30% 29% 30% 0.29% 0.33% 0.22% 0.15% 0.14% 0.14% 0.17% 4Q'18 1Q'19 2Q'19 3Q'19 4Q'19 3Q'16 4Q'16 1Q'17 2Q'17 3Q'17 4Q'17 1Q'18 2Q'18 3Q'18 4Q'18 1Q'19 2Q'19 3Q'19 4Q'19 Our focus on organic growth and relationship-based funding, in combination with our innovative analytics platform, supports a well-diversified low-cost deposit portfolio. FOURTH QUARTER 2019 EARNINGS PRESENTATION 11
Continued Strong Asset Quality Trends ($ in thousands) Net Charge-Offs Nonperforming Loans NCO NCO / Loans NPL - Non-Acquired NPL- Acquired Total NPL Ratio $3,7491 $3,225 $2,111 $5,965 $1,841 $5,644 $10,693 $6,986 $6,990 $20,400 $20,990 $963 $15,783 $15,423 $15,810 0.32% 0.08% 0.15% 0.17% 0.25% 0.55% 0.46% 0.47% 0.52% 0.52% 4Q'18 1Q'19 2Q'19 3Q'19 4Q'19 4Q'18 1Q'19 2Q'19 3Q'19 4Q'19 ALLL Classified and Criticized Assets2 ALLL ALLL Ratio ALLL Ratio-Total Classified Criticized Non-Acquired $35,154 $32,423 $32,822 $33,505 $33,605 4% 3% 3% 0.89% 0.89% 0.87% 0.84% 0.80% 3% 3% 14% 15% 12% 10% 9% 0.67% 0.68% 0.69% 0.67% 0.68% 4Q'18 1Q'19 2Q'19 3Q'19 4Q'19 4Q'18 1Q'19 2Q'19 3Q'19 4Q'19 FOURTH QUARTER 2019 EARNINGS PRESENTATION 1Includes charge off of $3.0 million for a single impaired loan. 2As a percentage of total risk-based capital 12
Strong Capital Supporting Fortress Balance Sheet Tangible Book Value / Book Value Per Share Tangible Common Equity / Tangible Assets Tangible Book Value Per Share Book Value Per Share 11.1% 11.1% $19.13 10.7% $18.08 $18.70 10.2% $16.83 $17.44 9.7% $14.76 $13.65 $14.30 $12.33 $12.98 4Q'18 1Q'19 2Q'19 3Q'19 4Q'19 4Q'18 1Q'19 2Q'19 3Q'19 4Q'19 Return on Tangible Common Equity Total Risk Based and Tier 1 Capital GAAP - ROTCE Adjusted - ROTCE 1 Total Risk Based Capital Tier 1 Ratio 15.5% 15.7% 15.4% 15.0% 15.2% 14.9% 15.0% 14.9% 15.1% 14.3% 15.2% 14.7% 15.3% 15.0% 14.2% 14.4% 14.6% 13.8% 14.3% 10.9% 4Q'18 1Q'19 2Q'19 3Q'19 4Q'19 4Q'18 1Q'19 2Q'19 3Q'19 4Q'19 FOURTH QUARTER 2019 EARNINGS PRESENTATION 1Non-GAAP measure, see “Explanation of Certain Unaudited Non-GAAP Financial Measures" for more information and a reconciliation to GAAP 13
Steady Increase in Shareholder Value Tangible Book Value Per Share $14.76 $14.30 $13.65 $12.98 $12.33 $12.01 $11.67 $11.39 $11.15 $10.95 $10.55 2Q'17 3Q'17 4Q'17 1Q'18 2Q'18 3Q'18 4Q'18 1Q'19 2Q'19 3Q'19 4Q'19 Compounded annual growth rate of 13% in tangible book value per share since announcing our Vision 2020 targets in February 2017. FOURTH QUARTER 2019 EARNINGS PRESENTATION 14
We Remain Confident in our Ability to Achieve Our Vision 2020 Targets Vision 2020 Targets Return on Tangible Assets 1.30% + Return on Tangible Common Equity 16% + Efficiency Ratio Below 50% FOURTH QUARTER 2019 EARNINGS PRESENTATION 15
Contact Details: Seacoast Banking Corporation of Florida Charles M. Shaffer Executive Vice President Chief Operating Officer and Chief Financial Officer (772) 221-7003 INVESTOR RELATIONS NASDAQ: SBCF FOURTH QUARTER 2019 EARNINGS PRESENTATION 16
Appendix FOURTH QUARTER 2019 EARNINGS PRESENTATION 17
Loan Production and Pipeline Trend Quarterly Trend Twelve Months Ended (Amounts in thousands) 4Q'19 3Q'19 2Q'19 1Q'19 4Q'18 4Q'19 4Q'18 Commercial pipeline at period end $ 255,993 $ 359,716 $ 261,586 $ 177,318 $ 164,064 $ 255,993 $ 164,064 Commercial loan originations1 246,980 282,224 156,958 109,076 159,388 795,238 552,878 Residential pipeline-saleable at period end 18,995 35,136 46,723 25,939 13,556 18,995 13,556 Residential loans-sold 61,821 80,758 61,391 32,558 31,525 236,528 189,235 Residential pipeline-portfolio at period end 19,107 43,378 3,756 19,346 30,100 19,107 30,100 Residential loans-retained2 163,260 22,365 51,755 49,645 73,201 287,025 305,953 Consumer and small business pipeline at period end 45,106 66,341 65,532 67,591 53,453 45,106 53,453 Consumer and small business originations 115,022 103,115 136,479 118,503 114,195 473,119 443,406 Total Pipelines at Period End $ 339,201 $ 504,571 $ 377,597 $ 290,194 $ 261,173 $ 339,201 $ 261,173 Total Originations $ 587,083 $ 488,462 $ 406,583 $ 309,782 $ 378,309 $ 1,791,910 $ 1,491,472 1Includes commercial real estate loans purchased of $52 million in 3Q'19 and $20 million in 2Q'19 2Includes residential mortgages purchased of $99 million in 4Q'19, $6 million in 3Q'19, $30 million in 2Q'19 and $20 million in 3Q'18 FOURTH QUARTER 2019 EARNINGS PRESENTATION 18
Explanation of Certain Unaudited Non-GAAP Financial Measures This presentation contains financial information determined by These measures are also useful in understanding performance trends methods other than Generally Accepted Accounting Principles and facilitate comparisons with the performance of other financial (“GAAP”). The financial highlights provide reconciliations between institutions. The limitations associated with operating measures are GAAP and adjusted financial measures including net income, the risk that persons might disagree as to the appropriateness of items noninterest income, noninterest expense, tax adjustments and other comprising these measures and that different companies might define financial ratios. Management uses these non-GAAP financial measures or calculate these measures differently. The Company provides in its analysis of the Company’s performance and believes these reconciliations between GAAP and these non-GAAP measures. These presentations provide useful supplemental information, and a clearer disclosures should not be considered an alternative to GAAP. 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. FOURTH QUARTER 2019 EARNINGS PRESENTATION 19
GAAP to Non-GAAP Reconciliation Quarterly Trend Twelve Months Ended (Amounts in thousands except per share data) 4Q'19 3Q'19 2Q'19 1Q'19 4Q'18 4Q'19 4Q'18 Net Income $ 27,176 $ 25,605 $ 23,253 $ 22,705 $ 15,962 $ 98,739 $ 67,275 Total noninterest income 16,376 13,943 13,577 12,836 12,714 56,732 50,022 Securities (gains)/losses, net (2,539) 847 466 9 425 (1,217) 623 BOLI benefits on death (included in other income) — (956) — — (280) (956) (280) Total Adjustments to Noninterest Income (2,539) (109) 466 9 145 (2,173) 343 Total Adjusted Noninterest Income 13,837 13,834 14,043 12,845 12,859 54,559 50,365 Total noninterest expense 38,057 38,583 41,000 43,099 49,464 160,739 162,273 Merger related charges (634) — — (335) (8,034) (969) (9,681) Amortization of intangibles (1,456) (1,456) (1,456) (1,458) (1,303) (5,826) (4,300) Business continuity expenses - hurricane events — (95) — — — (95) — Branch reductions and other expense initiatives — (121) (1,517) (208) (587) (1,846) (587) Total Adjustments to Noninterest Expense (2,090) (1,672) (2,973) (2,001) (9,924) (8,736) (14,568) Total Adjusted Noninterest Expense 35,967 36,911 38,027 41,098 39,540 152,003 147,705 Income Taxes 8,103 8,452 6,909 6,409 4,930 29,873 20,259 Tax effect of adjustments (110) 572 874 510 2,623 1,846 3,834 Taxes and tax penalties on acquisition-related BOLI — — — — (485) — (485) Effectredemption of change in corporate tax rate on deferred tax assets — (1,135) — — — (1,135) (248) Total Adjustments to Income Taxes (110) (563) 874 510 2,138 711 3,101 Adjusted Income Taxes 7,993 7,889 7,783 6,919 7,068 30,584 23,360 Adjusted Net Income $ 26,837 $ 27,731 $ 25,818 $ 24,205 $ 23,893 $ 104,591 $ 79,085 Earnings per diluted share, as reported $ 0.52 $ 0.49 $ 0.45 $ 0.44 $ 0.31 $ 1.90 $ 1.38 Adjusted Earnings per Diluted Share 0.52 0.53 0.50 0.47 0.47 2.01 1.62 Average shares outstanding 52,081 51,935 51,952 52,039 51,237 52,029 48,748 FOURTH QUARTER 2019 EARNINGS PRESENTATION 20
GAAP to Non-GAAP Reconciliation Quarterly Trend Twelve Months Ended (Amounts in thousands except per share data) 4Q'19 3Q'19 2Q'19 1Q'19 4Q'18 4Q'19 4Q'18 Adjusted Noninterest Expense $ 35,967 $ 36,911 $ 38,027 $ 41,098 $ 39,540 $ 152,003 $ 147,705 Foreclosed property expense and net gain/(loss) on sale (3) (262) 174 40 — (51) (460) Net Adjusted Noninterest Expense $ 35,964 $ 36,649 $ 38,201 $ 41,138 $ 39,540 $ 151,952 $ 147,245 Revenue $ 78,136 $ 74,891 $ 73,713 $ 73,610 $ 72,698 $ 300,350 $ 261,537 Total Adjustments to Revenue (2,539) (109) 466 9 145 (2,173) 343 Impact of FTE adjustment 87 79 83 87 116 336 441 Adjusted Revenue on a Fully Taxable Equivalent Basis $ 75,684 $ 74,861 $ 74,262 $ 73,706 $ 72,959 $ 298,513 $ 262,321 Adjusted Efficiency Ratio 47.52% 48.96% 51.44% 55.81% 54.19% 50.90% 56.13% Average Assets $ 6,996,214 $ 6,820,576 $ 6,734,994 $ 6,770,978 $ 6,589,870 $ 6,831,280 $ 6,057,335 Less average goodwill and intangible assets (226,060) (227,389) (228,706) (230,066) (213,713) (228,042) (178,287) Average Tangible Assets $ 6,770,154 $ 6,593,187 $ 6,506,288 $ 6,540,912 $ 6,376,157 $ 6,603,238 $ 5,879,048 Return on Average Assets (ROA) 1.54% 1.49% 1.38% 1.36% 0.96% 1.45% 1.11% Impact of removing average intangible assets and related 0.12 0.12 0.12 0.12 0.09 0.11 0.09 amortization Return on Average Tangible Assets (ROTA) 1.66 1.61 1.50 1.48 1.05 1.56 1.20 Impact of other adjustments for Adjusted Net Income (0.09) 0.06 0.09 0.02 0.44 0.02 0.15 Adjusted Return on Average Tangible Assets 1.57 1.67 1.59 1.50 1.49 1.58 1.35 Average Shareholders' Equity $ 976,200 $ 946,670 $ 911,479 $ 879,564 $ 827,759 $ 928,793 $ 740,571 Less average goodwill and intangible assets (226,060) (227,389) (228,706) (230,066) (213,713) (228,042) (178,287) Average Tangible Equity $ 750,140 $ 719,281 $ 682,773 $ 649,498 $ 614,046 $ 700,751 $ 562,284 Return on Average Shareholders' Equity 11.04% 10.73% 10.23% 10.47% 7.65% 10.63% 9.08% Impact of removing average intangible assets and related 3.91 4.00 4.07 4.39 3.29 4.09 3.46 amortization Return on Average Tangible Common Equity (ROTCE) 14.95 14.73 14.30 14.86 10.94 14.72 12.54 Impact of other adjustments for Adjusted Net Income (0.76) 0.57 0.87 0.25 4.50 0.21 1.52 Adjusted Return on Average Tangible Common Equity 14.19 15.30 15.17 15.11 15.44 14.93 14.06 FOURTH QUARTER 2019 EARNINGS PRESENTATION 21
GAAP to Non-GAAP Reconciliation Quarterly Trend Twelve Months Ended (Amounts in thousands except per share data) 4Q'19 3Q'19 2Q'19 1Q'19 4Q'18 4Q'19 4Q'18 Loan interest income excluding accretion on acquired loans $ 59,515 $ 59,279 $ 58,169 $ 58,397 $ 55,470 $ 235,359 $ 188,865 Accretion on acquired loans 3,407 3,859 4,166 3,938 4,089 15,371 11,329 Loan Interest Income1 $ 62,922 $ 63,138 $ 62,335 $ 62,335 $ 59,559 $ 250,730 $ 200,194 Yield on loans excluding accretion on acquired loans 4.63% 4.76% 4.82% 4.89% 4.77% 4.77% 4.59% Impact of accretion on acquired loans 0.26 0.30 0.34 0.33 0.35 0.31 0.28 Yield on Loans1 4.89 5.06 5.16 5.22 5.12 5.08 4.87 Net interest income excluding accretion on acquired loans $ 58,439 $ 57,168 $ 56,053 $ 56,923 $ 56,011 $ 228,582 $ 200,627 Accretion on acquired loans 3,407 3,859 4,166 3,938 4,089 15,371 11,329 Net Interest Income1 $ 61,846 $ 61,027 $ 60,219 $ 60,861 $ 60,100 $ 243,953 $ 211,956 Net interest margin excluding accretion on acquired loans 3.63% 3.64% 3.67% 3.76% 3.73% 3.67% 3.65% Impact of accretion on acquired loans 0.21 0.25 0.27 0.26 0.27 0.25 0.20 Net Interest Margin1 3.84 3.89 3.94 4.02 4.00 3.92 3.85 Security interest income excluding tax equivalent adjustment $ 8,630 $ 8,933 $ 9,076 $ 9,270 $ 9,728 $ 35,909 $ 38,743 Tax equivalent adjustment on securities 32 33 36 39 52 140 232 Security Interest Income1 $ 8,662 $ 8,966 $ 9,112 $ 9,309 $ 9,780 $ 36,049 $ 38,975 Loan interest income excluding tax equivalent adjustment $ 62,867 $ 63,091 $ 62,287 $ 62,287 $ 59,495 $ 250,532 $ 199,984 Tax equivalent adjustment on loans 55 47 48 48 64 198 210 Loan Interest Income1 $ 62,922 $ 63,138 $ 62,335 $ 62,335 $ 59,559 $ 250,730 $ 200,194 Net interest income excluding tax equivalent adjustments $ 61,759 $ 60,947 $ 60,135 $ 60,774 $ 59,984 $ 243,615 $ 211,514 Tax equivalent adjustment on securities 32 33 36 39 52 140 232 Tax equivalent adjustment on loans 55 47 48 48 64 198 210 Net Interest Income1 $ 61,846 $ 61,027 $ 60,219 $ 60,861 $ 60,100 $ 243,953 $ 211,956 1On a fully taxable equivalent basis. All yields and rates have been computed using amortized cost. FOURTH QUARTER 2019 EARNINGS PRESENTATION 22
GAAP to Non-GAAP Reconciliation ($ in thousands) $634 $2$91,12066 Tax effect of Merger$28,6 related32 adjustments charges $2,539 $1,456 Net Income Adjusted Net Income $27,176 Amortization of intangibles $Securities26,837 $26,837 gains, net FOURTH QUARTER 2019 EARNINGS PRESENTATION 23