Seacoast Banking Corporation Of Florida (NASDAQ:SBCF) Q1 2022 Earnings Conference Call April 29, 2022 10:00 AM ET Company Participants Chuck Shaffer - Chairman, President & Chief Executive Officer Tracey Dexter - Executive Vice President & Chief Financial Officer Jeffery Lee - Executive Vice President & Chief Digital Officer Conference Call Participants Brady Gailey - KBW David Feaster - Raymond James Michael Young - Truist Steve Moss - B. Riley Securities Operator Good morning and welcome to Seacoast Banki ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2021 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _______ to _________ Commission File No. 0-13660 Seacoast Banking Corporation of Florida (Exact Name of Registrant as Specified in its Charter) | Florida | | | 59-2260678 | | --- ...

| --- | --- | --- | --- | |---------------------|-------|------------------------|-------| | | | | | | | | | | | | | INVESTOR PRESENTATION | | | Fourth Quarter 2021 | | | 20 21 | 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 resu ...

| --- | --- | |-------|-------| | | | | | | | EARNINGS PRESENTATION | | | FOURTH QUARTER 2021 | 20 21 | 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 t ...

Financial Data and Key Metrics Changes - The company generated $42.3 million in pre-tax, pre-provisioning earnings and grew tangible book value per share by 10% year-over-year to $17.84 [7] - Earnings per share increased by 17% to $0.62 in Q4 2021, with net income rising 24% year-over-year to $36.3 million [17] - Adjusted return on tangible assets was reported at 1.49% [7] - The adjusted efficiency ratio was 53.4% [7] Business Line Data and Key Metrics Changes - Commercial loan originations reached a record $409 million, up 23% from the previous quarter and 47% year-over-year [18] - Consumer lending also saw a record production with originations increasing 9% from the prior quarter and 53% from the prior year [19] - Wealth management division grew with new assets under management of $419 million for the full year, totaling $1.2 billion, a 42% year-over-year increase [20] Market Data and Key Metrics Changes - The company reported a significant migration of affluent individuals and businesses to Florida, contributing to a strong business environment [8] - The loan pipeline reached record levels, indicating robust demand across both commercial and consumer segments [8][41] Company Strategy and Development Direction - The company is focused on enhancing its digital banking platform and expanding its commercial banking team, with plans to launch teams in Jacksonville and Naples [10][11] - Acquisition discussions are ongoing, with expectations for continued M&A opportunities in the coming year [15] - The company aims to maintain a well-capitalized balance sheet and strict underwriting standards while pursuing disciplined growth [14][61] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the economic growth in Florida, citing strong demand for loans and a favorable hiring market [8][70] - The company anticipates continued loan growth in the mid-to-high single digits for 2022, supported by a strong pipeline and recent hires [44] - Management noted that the competitive landscape remains challenging but believes their focus on customer experience will help capture market share [74] Other Important Information - The allowance for loan losses decreased to $83.3 million, reflecting strong portfolio quality trends [57] - The company expects to maintain expense discipline while investing in talent and technology enhancements [35] Q&A Session Summary Question: What is driving the increase in loan production? - Management attributed the increase to strong economic growth in Florida and the expansion of their banking team, which contributed about 20% to the pipeline [68][70] Question: Where are the most opportunities for growth? - Management highlighted the focus on improving customer experiences and leveraging their data analytics platform to drive growth [72][74] Question: What are the expectations for net interest margin (NIM)? - Management expects NIM to stabilize and potentially increase with upcoming rate hikes, while also noting historical deposit betas [76][80] Question: What is the outlook for mortgage banking? - Management anticipates some constraints in mortgage production due to market conditions but expects improvements as the year progresses [91][92] Question: How does the M&A strategy change with the company now over $10 billion? - Management clarified that the focus remains on the right markets rather than shifting to larger targets, with opportunities still available among smaller banks [99]

| --- | --- | --- | --- | |-------|-------|-------|-------| | | | | | | | | | | | | | | | | | | | | | Earnings Presentation | | | | | THIRD QUARTER 2021 RESULTS | | | Contact: (email) Tracey.Dexter@SeacoastBank.com (phone) 772.403.0461 (web) www.SeacoastBanking.com | Cautionary Notice Regarding Forward-Looking Statements This press release contains "forward-looking statements" within the meaning, and protections, of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of ...

Part I FINANCIAL INFORMATION [Item 1. Financial Statements (Unaudited)](index=3&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) The unaudited condensed consolidated financial statements show Q3 2021 net income of $22.9 million, with nine-month net income at $88.1 million, and total assets growing to $9.9 billion driven by deposit and loan growth [Condensed consolidated statements of income](index=3&type=section&id=Condensed%20consolidated%20statements%20of%20income) Q3 2021 net income was $22.9 million, with net interest income at $71.3 million, and nine-month net income significantly increased to $88.1 million Condensed Consolidated Statements of Income Highlights (Unaudited) | (In thousands, except per share data) | Three Months Ended Sep 30, 2021 (in thousands) | Three Months Ended Sep 30, 2020 (in thousands) | Nine Months Ended Sep 30, 2021 (in thousands) | Nine Months Ended Sep 30, 2020 (in thousands) | | :--- | :--- | :--- | :--- | :--- | | **Net Interest Income** | $71,324 | $63,503 | $203,736 | $193,952 | | **Provision for credit losses** | $5,091 | $(845) | $(5,479) | $36,279 | | **Total Noninterest Income** | $19,028 | $16,946 | $52,021 | $46,640 | | **Total Noninterest Expenses** | $55,268 | $51,674 | $147,172 | $141,871 | | **Net Income** | $22,944 | $22,628 | $88,073 | $48,417 | | **Diluted EPS** | $0.40 (per share) | $0.42 (per share) | $1.56 (per share) | $0.91 (per share) | [Condensed consolidated balance sheets](index=5&type=section&id=Condensed%20consolidated%20balance%20sheets) Total assets increased to $9.9 billion by September 30, 2021, from $8.3 billion at year-end 2020, driven by cash, securities, and loan growth, and substantial deposit increases Condensed Consolidated Balance Sheet Highlights (Unaudited) | (In thousands) | September 30, 2021 (in thousands) | December 31, 2020 (in thousands) | | :--- | :--- | :--- | | **Total cash and cash equivalents** | $1,227,695 | $404,088 | | **Total debt securities** | $2,072,657 | $1,582,641 | | **Loans, net of allowance** | $5,818,061 | $5,642,616 | | **Total Assets** | **$9,893,498** | **$8,342,392** | | **Deposits** | $8,334,172 | $6,932,561 | | **Total Liabilities** | $8,602,978 | $7,211,990 | | **Total Shareholders' Equity** | $1,290,520 | $1,130,402 | [Notes to condensed consolidated financial statements](index=10&type=section&id=Notes%20to%20condensed%20consolidated%20financial%20statements) Detailed disclosures cover the $2.1 billion securities portfolio, $5.9 billion loan portfolio, $87.8 million allowance for credit losses, derivative instruments, and business combinations - During Q1 2021, the company reclassified debt securities with an amortized cost of **$210.8 million** from available-for-sale to held-to-maturity, as it has the ability and intent to hold these securities to maturity[28](index=28&type=chunk) - Total loans on nonaccrual status were **$32.6 million** at September 30, 2021, a decrease from **$36.1 million** at December 31, 2020[43](index=43&type=chunk)[44](index=44&type=chunk)[45](index=45&type=chunk) - The allowance for credit losses decreased to **$87.8 million** at September 30, 2021, from **$92.7 million** at year-end 2020, primarily due to a negative provision for credit losses of **$5.5 million** for the nine-month period[62](index=62&type=chunk) - On August 6, 2021, the company completed its acquisition of Legacy Bank of Florida for a total purchase price of **$91.2 million**, resulting in **$31.0 million** of goodwill[100](index=100&type=chunk)[102](index=102&type=chunk) - The company announced two additional proposed acquisitions in August 2021: Sabal Palm Bancorp, Inc. and Business Bank of Florida, Corp, both expected to close in Q1 2022[98](index=98&type=chunk)[99](index=99&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=38&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management reported Q3 2021 net income of $22.9 million, adjusted net income of $29.4 million, highlighting 12% YoY net interest income growth, strong commercial loan originations, improved asset quality, and a well-capitalized position [Results of Operations](index=42&type=section&id=Results%20of%20Operations) Q3 2021 net income was $22.9 million, adjusted net income $29.4 million, driven by 12% YoY net interest income growth and higher noninterest income, leading to an improved adjusted efficiency ratio of 51.50% Q3 2021 Performance Summary | Metric | Q3 2021 (in millions) | Q2 2021 (in millions) | Q3 2020 (in millions) | | :--- | :--- | :--- | :--- | | **Net Income (GAAP)** | $22.9M | $31.4M | $22.6M | | **Diluted EPS (GAAP)** | $0.40 | $0.56 | $0.42 | | **Adjusted Net Income (Non-GAAP)** | $29.4M | $33.3M | $27.3M | | **Adjusted Diluted EPS (Non-GAAP)** | $0.51 | $0.59 | $0.50 | - Net interest margin was **3.22%** in Q3 2021, compared to **3.23%** in Q2 2021 and **3.40%** in Q3 2020. The margin was positively impacted by **18 basis points** from PPP loan interest and fees[142](index=142&type=chunk) - Commercial loan originations were a strong **$331.6 million** in Q3 2021, a **72% increase** from Q2 2021 and a **276% increase** from Q3 2020, reflecting investments in commercial banking talent[144](index=144&type=chunk) - Wealth management income reached a record **$2.6 million** in Q3 2021, up **30% YoY**, with assets under management growing to **$1.2 billion**[162](index=162&type=chunk) - The adjusted efficiency ratio improved to **51.50%** in Q3 2021 from **54.82%** in Q3 2020, reflecting higher revenues[168](index=168&type=chunk)[169](index=169&type=chunk) [Financial Condition](index=55&type=section&id=Financial%20Condition) Total assets grew 19% to $9.9 billion by September 30, 2021, driven by the Legacy Bank acquisition and strong deposit growth, with asset quality improving and a CET1 ratio of 16.53% - Total assets increased by **$1.6 billion (19%)** since December 31, 2020, driven by the Legacy Bank acquisition and higher cash balances from deposit growth[187](index=187&type=chunk) - Total deposits increased by **$1.4 billion (20%)** to **$8.3 billion** since year-end 2020. Noninterest demand deposits grew by **35%** and now represent **37%** of total deposits[237](index=237&type=chunk)[238](index=238&type=chunk) - Asset quality improved, with nonperforming assets (NPAs) decreasing to **$46.2 million**, or **0.47%** of total assets, compared to **$48.9 million**, or **0.59%** of total assets, at December 31, 2020[215](index=215&type=chunk)[216](index=216&type=chunk) Regulatory Capital Ratios (Consolidated) | Ratio | September 30, 2021 (%) | Minimum to be Well Capitalized (%) | | :--- | :--- | :--- | | **Total Risk-Based Capital** | 18.56% | 10.00% | | **Tier 1 Capital** | 17.66% | 8.00% | | **Common Equity Tier 1 (CET1)** | 16.53% | 6.50% | | **Leverage Ratio** | 11.74% | 5.00% | [Critical Accounting Policies and Estimates](index=66&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) Critical accounting policies involve significant estimates for allowance for credit losses, acquisition accounting, intangible asset impairment, fair value measurements, debt security impairment, and contingent liabilities - The most critical accounting estimates involve the allowance for credit losses, acquisition accounting, intangible asset impairment, fair value measurements, debt security impairment, and contingent liabilities[255](index=255&type=chunk)[262](index=262&type=chunk) - The allowance for credit losses is estimated using a model based on probability of default (PD) and loss given default (LGD), incorporating a three-year economic forecast and qualitative adjustments[257](index=257&type=chunk)[258](index=258&type=chunk)[259](index=259&type=chunk) [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=67&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company's primary market risk is interest rate risk, managed by ALCO, with simulation models projecting NII and EVE sensitivity to interest rate changes, indicating an asset-sensitive position Projected Impact of Interest Rate Changes on Net Interest Income (NII) | Change in Interest Rates | % Change in NII (1-12 months) | % Change in NII (13-24 months) | | :--- | :--- | :--- | | **+2.00%** | 11.4% | 15.1% | | **+1.00%** | 5.6% | 7.7% | | **-1.00%** | (1.8%) | (7.5%) | Projected Impact of Interest Rate Changes on Economic Value of Equity (EVE) | Change in Interest Rates | % Change in EVE | | :--- | :--- | | **+2.00%** | 20.7% | | **+1.00%** | 11.2% | | **-1.00%** | (12.1%) | [Item 4. Controls and Procedures](index=68&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of September 30, 2021, with no material changes to internal control over financial reporting during the quarter - Management concluded that the company's disclosure controls and procedures were effective as of September 30, 2021[293](index=293&type=chunk) - No material changes were made to the internal control over financial reporting during the quarter ended September 30, 2021[294](index=294&type=chunk) Part II OTHER INFORMATION [Item 1. Legal Proceedings](index=68&type=section&id=Item%201.%20Legal%20Proceedings) The company is subject to various legal actions in the normal course of business, none of which are expected to have a material adverse effect on financial condition or results - Management does not expect any current legal proceedings to have a material adverse effect on the company's financial position or results of operations[295](index=295&type=chunk) [Item 1A. Risk Factors](index=69&type=section&id=Item%201A.%20Risk%20Factors) No material changes have occurred to the risk factors previously disclosed in the company's Annual Report on Form 10-K for the year ended December 31, 2020 - No material changes have been made to the risk factors previously disclosed in the Form 10-K for the year ended December 31, 2020[297](index=297&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=69&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company details share repurchases for tax withholding obligations, noting no shares were repurchased under the $100 million program authorized in December 2020 - A **$100 million** share repurchase program was authorized in December 2020, expiring December 31, 2021[298](index=298&type=chunk) - As of September 30, 2021, no shares had been repurchased under the **$100 million** program. The **62,350 shares** purchased year-to-date were to satisfy tax withholding on employee stock awards[298](index=298&type=chunk) [Item 6. Exhibits](index=71&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Form 10-Q, including merger agreements, corporate governance documents, and CEO/CFO certifications

Financial Data and Key Metrics Changes - The company reported a net income of $22.9 million on a GAAP basis, and an adjusted net income of $29.4 million, reflecting a decline from the prior quarter due to increased provisions for loan losses related to the Legacy Bank acquisition [23][24] - Tangible book value per share increased by 13% year-over-year to $17.52, and adjusted pre-tax pre-provision earnings rose to $43.9 million, up 16% from the previous quarter [6][24] - The adjusted efficiency ratio improved to 51.5%, indicating better operational efficiency compared to previous guidance [6][44] Business Line Data and Key Metrics Changes - Organic loan production increased significantly, with commercial loan originations rising to $332 million from $193 million in the previous quarter [25] - The late-stage commercial pipeline reached a record $369 million, indicating strong future loan growth potential [25] - Non-interest income was robust, with record gains in wealth management and SBA sales, contributing to a total adjusted non-interest income of $19.1 million, up 24% from the previous quarter [34][37] Market Data and Key Metrics Changes - The company’s total deposits increased to $8.3 billion, with a quarter-over-quarter growth of $498 million, primarily due to the Legacy Bank acquisition [55] - Transaction accounts represented 59% of total deposits and grew by 30% year-over-year, demonstrating strong customer engagement and market share growth [56] - The cost of deposits remained low at 7 basis points, reflecting effective management of the competitive landscape [30][55] Company Strategy and Development Direction - The company aims to increase market share in Florida by focusing on value-creating relationships and enhancing digital customer experiences [21][22] - There is a strategic emphasis on expanding commercial banking capabilities and recruiting talent to support growth in key markets [14][17] - The company plans to maintain strict credit underwriting standards while pursuing disciplined growth with appropriate risk-adjusted returns [19][21] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in loan growth emerging, targeting mid-single-digit organic loan growth in Q4 and high-single-digit growth in 2022 [18][46] - The Florida economy is experiencing robust growth, driven by population influx and corporate relocations, which is expected to support increased commercial loan production [10][11] - Management remains cautious about net interest margin pressures due to excess liquidity but anticipates a recovery in 2022 as loan growth accelerates [32][66] Other Important Information - The company completed the acquisition of Legacy Bank in August, which is expected to enhance its market position and operational scale [27] - The company announced two additional acquisitions, Sabal Palm Bank and Florida Business Bank, expected to close in January 2022 [27][98] - The allowance for loan losses increased to $87.8 million, reflecting the impact of the Legacy Bank acquisition and ongoing credit quality management [60][62] Q&A Session Summary Question: Insights on NIM and NII growth trajectory - Management indicated that core NIM is expected to decline modestly in Q4 but anticipates a recovery in 2022 as loan growth picks up and excess liquidity is deployed [75][76] Question: Impact of new hires on growth - Approximately 20% of commercial bankers are new hires, contributing 11% to production, indicating significant potential for future growth as these bankers ramp up [80][82] Question: Future de novo expansion plans - The company plans to focus on existing markets for de novo expansion, particularly in areas with talent availability and economic growth opportunities [84][86] Question: Loan pricing and competitive landscape - Loan pricing remains competitive, with organic add-on rates slightly lower than the previous quarter, but management sees stability in the market [92][94] Question: Expectations for deposit growth normalization - Management expects deposit growth to normalize but believes high levels of liquidity will persist for several years due to the Fed's actions [103][104] Question: Asset sensitivity and deposit betas - The company maintains a strong asset-sensitive position, expecting meaningful increases in NII and NIM with rising interest rates, benefiting from a low-cost deposit base [106][108] Question: Technology-driven initiatives - The company is focused on enhancing its digital tools and analytics capabilities but is not currently pursuing DeFi or buy-now-pay-later models [111]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2021 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _______________ to __________________. Commission File No. 0-13660 Seacoast Banking Corporation of Florida (Exact Name of Registrant as Specified in its Charter) ...

Seacoast Banking Corporation of Florida (NASDAQ:SBCF) Q2 2021 Earnings Conference Call July 23, 2021 10:00 AM ET Company Participants Chuck Shaffer - President and Chief Executive Officer Tracey Dexter - Chief Financial Officer Jeff Lee - Chief Digital Officer Conference Call Participants David Feaster - Raymond James Michael Young - SunTrust Robinson Humphrey Steve Moss - B. Riley FBR Inc. Stephen Scouten - Piper Sandler Operator Welcome to Seacoast Banking Corporation’s Second Quarter 2021 Earnings Confer ...