Core Insights - Southern First Bancshares (NASDAQ: SFST) is a small regional bank holding company with a market capitalization of $353 million, primarily operating in the Southeastern US, which often leads to it being overlooked by investors [1] Company Overview - The company is characterized as a small regional bank, indicating a niche market presence and potential for growth opportunities that may not be fully recognized by the broader market [1] Investment Perspective - The article suggests that the best investment opportunities often arise from stocks that are less widely followed or those that do not accurately reflect the current market opportunities, implying that Southern First Bancshares may present such an opportunity [1]

Core Insights - Southern First Bancshares (NASDAQ: SFST) is a small regional bank holding company with a market capitalization of $353 million, primarily operating in the Southeastern US, which often leads to it being overlooked by investors [1] Company Overview - The company is characterized as a small regional bank, indicating a niche market presence and potential for growth opportunities that may not be fully recognized by the broader market [1] Investment Perspective - The article suggests that the best investment opportunities often arise from stocks that are less widely followed or those that do not accurately reflect the current market opportunities, implying that Southern First Bancshares may present such an opportunity [1]

Financial Performance - Net income for the three months ended June 30, 2025, was $6.6 million, compared to $3.0 million for the same period in 2024, representing a 120% increase [119]. - Diluted earnings per share (EPS) rose to $0.81 for Q2 2025, up from $0.37 in Q2 2024 [119]. - Net interest income for Q2 2025 was $25.3 million, a 29.5% increase from $19.5 million in Q2 2024 [121]. - For the first half of 2025, net interest income rose to $48.7 million, up 27.5% from $38.2 million in the same period of 2024, driven by a $7.5 million decrease in interest expense [139]. - Noninterest income for Q2 2025 was $3.3 million, a decrease of $189,000 or 5.4% from Q2 2024, with mortgage banking income down by $354,000 or 18.4% [145]. - Noninterest expense for Q2 2025 was $19.3 million, an increase of $693,000 or 3.7% from Q2 2024, primarily due to higher compensation and benefits expenses [149]. - The efficiency ratio improved to 67.5% in Q2 2025 from 80.9% in Q2 2024, reflecting increased net interest income [151]. Assets and Liabilities - Total assets increased to $4.31 billion, a 5.4% rise from $4.09 billion at December 31, 2024 [116]. - Total liabilities at June 30, 2025, were $3.96 billion, compared to $3.76 billion at December 31, 2024 [116]. - Shareholders' equity increased to $345.5 million at June 30, 2025, from $330.4 million at December 31, 2024 [116]. - Cash and cash equivalents totaled $271.0 million at June 30, 2025, representing 6.3% of total assets [184]. - Retail deposits increased to $3.08 billion, or 84.6% of total deposits, while wholesale deposits were $560.7 million, or 15.4% of total deposits at June 30, 2025 [174]. Loans and Credit Quality - Loans amounted to $3.75 billion at June 30, 2025, up from $3.63 billion at December 31, 2024 [116]. - Average loan balances increased by $78.5 million year-over-year for Q2 2025, contributing to a six basis point increase in yield on interest-earning assets [129]. - The loan portfolio increased by $115.1 million or 6.39% annualized in the first half of 2025, driven by increases in consumer and commercial loans [157]. - The provision for credit losses was $700,000 in Q2 2025, compared to $500,000 in Q2 2024, reflecting growth in the loan portfolio [142]. - Nonperforming assets totaled $11.7 million or 0.27% of total assets as of June 30, 2025, compared to $10.9 million or 0.27% at December 31, 2024 [163]. - As of June 30, 2025, the allowance for credit losses was $41.3 million, representing 1.10% of outstanding loans and providing coverage of 362.35% of nonperforming loans [168]. Interest Income and Expense - Net interest margin (TE) improved to 2.50% in Q2 2025, compared to 1.98% in Q2 2024 [127]. - Interest expense on interest-bearing deposits decreased by $3.9 million, contributing to the increase in net interest income [121]. - Average interest-earning assets grew by $79.1 million, with an average yield increase to 5.18% [127]. - Net interest spread improved to 1.69% in Q2 2025 from 1.08% in Q2 2024, driven by a 61 basis point increase due to a decrease in interest-bearing liabilities [130]. - The average yield on loans increased by 14 basis points to 5.24% in the first half of 2025, contributing to the overall increase in interest income [135]. Capital Ratios and Risk Management - The bank maintained a total capital ratio of 12.58% as of June 30, 2025, exceeding the minimum requirement of 8.00% [198]. - Tier 1 capital ratio was 11.33% at June 30, 2025, above the minimum requirement of 6.00% [198]. - Common equity Tier 1 capital ratio stood at 11.33% as of June 30, 2025, surpassing the minimum requirement of 4.50% [198]. - The company actively manages interest rate risk through asset/liability management to ensure adequate liquidity and balance between interest-sensitive assets and liabilities [211]. - The asset/liability management committee (ALCO) meets quarterly to monitor interest rate sensitivity within board-approved limits [211]. Interest Rate Sensitivity - As of June 30, 2025, a 300 basis points increase in interest rates is projected to decrease net interest income by 7.07% [213]. - A 200 basis points increase in interest rates is expected to reduce net interest income by 4.03% [213]. - A 100 basis points increase in interest rates will lead to a decrease of 1.64% in net interest income [213]. - A decrease of 100 basis points in interest rates is anticipated to increase net interest income by 1.67% [213]. - A decrease of 200 basis points in interest rates is projected to boost net interest income by 5.78% [213]. - A decrease of 300 basis points in interest rates is expected to enhance net interest income by 15.43% [213]. Accounting and Market Risks - The company does not expect recently issued accounting standards to have a material impact on consolidated financial statements upon adoption [209]. - Market risks primarily arise from interest rate risk related to lending, investing, and borrowing activities [210].

Core Viewpoint - Southern First (SFST) has been upgraded to a Zacks Rank 1 (Strong Buy) due to an upward trend in earnings estimates, which is a significant factor influencing stock prices [1][3]. Earnings Estimates and Stock Performance - The Zacks rating system is based on changes in a company's earnings picture, with the Zacks Consensus Estimate tracking EPS estimates from sell-side analysts [1][2]. - A strong correlation exists between changes in earnings estimates and near-term stock price movements, influenced by institutional investors who adjust their valuations based on these estimates [4][6]. Recent Developments for Southern First - For the fiscal year ending December 2025, Southern First is expected to earn $3.05 per share, unchanged from the previous year, but analysts have raised their estimates by 14% over the past three months [8]. - The upgrade to Zacks Rank 1 indicates an improvement in Southern First's underlying business, which is likely to drive the stock price higher as investors respond positively to this trend [5][10]. Zacks Rank System Overview - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with Zacks Rank 1 stocks historically generating an average annual return of +25% since 1988 [7]. - Only the top 5% of Zacks-covered stocks receive a "Strong Buy" rating, indicating superior earnings estimate revisions and potential for market-beating returns [9][10].

Core Insights - Three stocks with strong buy rankings and momentum characteristics are highlighted for investors: Charles Schwab, Texas Capital Bancshares, and Southern First Bancshares [1][2][3][4] Company Summaries - **Charles Schwab (SCHW)**: - Zacks Rank: 1 (Strong Buy) - Current year earnings estimate increased by 6.5% over the last 60 days - Share price increased by 19.4% over the last three months, outperforming the S&P 500's 15.2% gain - Momentum Score: A [1][2] - **Texas Capital Bancshares (TCBI)**: - Zacks Rank: 1 (Strong Buy) - Current year earnings estimate increased by 8.2% over the last 60 days - Share price increased by 30% over the last three months, significantly outperforming the S&P 500's 15.2% gain - Momentum Score: A [2][3] - **Southern First Bancshares (SFST)**: - Zacks Rank: 1 (Strong Buy) - Current year earnings estimate increased by 14.2% over the last 60 days - Share price increased by 33.3% over the last three months, also outperforming the S&P 500's 15.2% gain - Momentum Score: A [3][4]

Core Viewpoint - Southern First (SFST) reported quarterly earnings of $0.81 per share, exceeding the Zacks Consensus Estimate of $0.65 per share, and showing significant growth from $0.37 per share a year ago, indicating strong financial performance [1][2] Financial Performance - The company achieved revenues of $28.63 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 7.81%, compared to $23.05 million in the same quarter last year [2] - Southern First has consistently outperformed consensus EPS estimates over the last four quarters, achieving earnings surprises of +24.62% in the latest quarter and +6.56% in the previous quarter [1][2] Stock Performance and Outlook - Southern First shares have increased by approximately 0.9% since the beginning of the year, underperforming compared to the S&P 500's gain of 7.2% [3] - The company's current Zacks Rank is 3 (Hold), indicating expected performance in line with the market in the near future [6] Earnings Estimates - The current consensus EPS estimate for the upcoming quarter is $0.73 on revenues of $27.89 million, and for the current fiscal year, it is $2.79 on revenues of $108.88 million [7] - The trend of earnings estimate revisions is mixed ahead of the earnings release, which may influence future stock performance [6] Industry Context - The Banks - Southeast industry, to which Southern First belongs, is currently ranked in the top 16% of over 250 Zacks industries, suggesting a favorable environment for performance [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which could impact investor sentiment [5]

[Executive Summary & Company Overview](index=1&type=section&id=Executive%20Summary%20%26%20Company%20Overview) Southern First Bancshares' Q2 2025 performance shows strong revenue growth, margin expansion, and strategic advancements [CEO Statement & Strategic Highlights](index=1&type=section&id=CEO%20Statement%20%26%20Strategic%20Highlights) CEO highlights strong Q2 2025 revenue growth, margin expansion, and strategic initiatives - Total revenue grew **24%** over the same quarter a year ago, marking one of the highest revenue generating quarters in the company's 25-year history[2](index=2&type=chunk) - The company achieved solid margin expansion due to focused pricing and discipline on both sides of the balance sheet[2](index=2&type=chunk) - Three new Board members were added, bringing valuable contributions through their community involvement and professional expertise[2](index=2&type=chunk) - The company continues to attract highly talented and experienced bankers, providing opportunities for depth in existing areas and expansion[2](index=2&type=chunk) [Key Financial Highlights (Q2 2025)](index=1&type=section&id=Key%20Financial%20Highlights%20%28Q2%202025%29) Q2 2025 shows significant improvements in diluted EPS, net interest margin, loan/deposit growth, and asset quality | Metric | Q2 2025 | Q1 2025 | Q2 2024 | YoY Change (Q2 2025 vs Q2 2024) | QoQ Change (Q2 2025 vs Q1 2025) | | :-------------------------------- | :------ | :------ | :------ | :-------------------------------- | :-------------------------------- | | Net income available to common shareholders ($ thousands) | 6,581 | 5,266 | 2,999 | +119.4% | +24.9% | | Earnings per common share, diluted | 0.81 | 0.65 | 0.37 | +118.9% | +24.6% | | Total revenue ($ thousands) | 28,629 | 26,497 | 23,051 | +24.2% | +8.0% | | Net interest margin (tax-equivalent) | 2.50% | 2.41% | 1.98% | +52 bps | +9 bps | | Return on average assets | 0.63% | 0.52% | 0.29% | +34 bps | +11 bps | | Return on average equity | 7.71% | 6.38% | 3.81% | +390 bps | +133 bps | | Efficiency ratio | 67.54% | 71.08% | 80.87% | -1333 bps | -354 bps | | Total loans ($ thousands) | 3,746,841 | 3,683,919 | 3,622,521 | +3.4% | +1.7% (7% annualized) | | Total deposits ($ thousands) | 3,636,329 | 3,620,886 | 3,459,869 | +5.1% | +0.4% | | Core deposits ($ thousands) | 2,867,193 | 2,820,194 | 2,788,223 | +2.8% | +1.7% (7% annualized) | | Total assets ($ thousands) | 4,308,067 | 4,284,311 | 4,109,849 | +4.8% | +0.6% | | Book value per common share | 42.23 | 41.33 | 39.09 | +8.0% | +2.2% (9% annualized) | | Tangible common equity | 8.02% | 7.88% | 7.76% | +26 bps | +14 bps | | Nonperforming assets/total assets | 0.27% | 0.26% | 0.27% | 0 bps | +1 bps | | Allowance for credit losses/loans | 1.10% | 1.10% | 1.11% | -1 bps | 0 bps | [Financial Performance Analysis](index=2&type=section&id=Financial%20Performance%20Analysis) Analysis of income statement, balance sheet, and asset quality, detailing key financial drivers [Income Statement Overview](index=2&type=section&id=Income%20Statement%20Overview) Q2 2025 net income increased significantly, driven by higher net interest income and noninterest income growth [Net Interest Income and Margin](index=2&type=section&id=Net%20Interest%20Income%20and%20Margin) Net interest income and margin analysis details interest income, expense, and their impact on profitability | Metric | Q2 2025 ($ thousands) | Q1 2025 ($ thousands) | Q2 2024 ($ thousands) | YoY Change (Q2 2025 vs Q2 2024) | QoQ Change (Q2 2025 vs Q1 2025) | | :---------------------- | :-------------------- | :-------------------- | :-------------------- | :-------------------------------- | :-------------------------------- | | Total interest income | 52,318 | 49,647 | 50,546 | +3.51% | +5.38% | | Total interest expense | 27,023 | 26,264 | 31,018 | -12.88% | +2.89% | | Net interest income | 25,295 | 23,383 | 19,528 | +29.53% | +8.18% | | Net interest margin (tax-equivalent) | 2.50% | 2.41% | 1.98% | +52 bps | +9 bps | - The increase in net interest income was driven by a **$2.7 million** increase in interest income, partially offset by a **$759 thousand** increase in interest expense, quarter-over-quarter[12](index=12&type=chunk) - Loan yield increased **eight basis points** and the yield on Federal funds sold and interest-bearing deposits increased by **five basis points** over the previous quarter, contributing to higher interest income[12](index=12&type=chunk) - A **four basis point** decrease in the rate on interest-bearing deposits over the previous quarter helped reduce interest expense[12](index=12&type=chunk) [Noninterest Income](index=2&type=section&id=Noninterest%20Income) Overview of noninterest income components, highlighting mortgage banking and service fees on deposit accounts | Metric | Q2 2025 ($ thousands) | Q1 2025 ($ thousands) | Q2 2024 ($ thousands) | YoY Change (Q2 2025 vs Q2 2024) | QoQ Change (Q2 2025 vs Q1 2025) | | :-------------------------- | :-------------------- | :-------------------- | :-------------------- | :-------------------------------- | :-------------------------------- | | Total noninterest income | 3,334 | 3,114 | 3,523 | -5.36% | +7.06% | | Mortgage banking income | 1,569 | 1,424 | 1,923 | -18.41% | +10.18% | | Service fees on deposit accounts | 567 | 539 | 423 | +34.04% | +5.20% | - Mortgage banking income remained the largest component of noninterest income, increasing from **$1.4 million** in Q1 2025 to **$1.6 million** in Q2 2025 due to a slight increase in mortgage origination volume[8](index=8&type=chunk) [Noninterest Expense](index=3&type=section&id=Noninterest%20Expense) Analysis of noninterest expenses, focusing on compensation, benefits, and data processing costs | Metric | Q2 2025 ($ thousands) | Q1 2025 ($ thousands) | Q2 2024 ($ thousands) | YoY Change (Q2 2025 vs Q2 2024) | QoQ Change (Q2 2025 vs Q1 2025) | | :-------------------------- | :-------------------- | :-------------------- | :-------------------- | :-------------------------------- | :-------------------------------- | | Total noninterest expenses | 19,336 | 18,836 | 18,643 | +3.72% | +2.65% | | Compensation and benefits | 11,674 | 11,304 | 11,290 | +3.40% | +3.27% | | Outside service and data processing costs | 2,189 | 2,037 | 1,962 | +11.57% | +7.46% | - The quarter-over-quarter increase in noninterest expense was driven by higher compensation and benefits, outside service and data processing costs, and professional fees, partially offset by a decrease in insurance expense[9](index=9&type=chunk) [Provision for Credit Losses](index=2&type=section&id=Provision%20for%20Credit%20Losses) Details on provision for credit losses, including components and primary drivers behind reported amounts | Metric | Q2 2025 ($ thousands) | Q1 2025 ($ thousands) | Q2 2024 ($ thousands) | YoY Change (Q2 2025 vs Q2 2024) | QoQ Change (Q2 2025 vs Q1 2025) | | :-------------------------- | :-------------------- | :-------------------- | :-------------------- | :-------------------------------- | :-------------------------------- | | Provision for credit losses | 700 | 750 | 500 | +40.00% | -6.67% | - The provision for credit losses in Q2 2025 included **$650 thousand** for credit losses and **$50 thousand** for the reserve for unfunded commitments[7](index=7&type=chunk) - The provision was primarily driven by a **$62.9 million** increase in total loans during the quarter[7](index=7&type=chunk) [Net Income and EPS](index=2&type=section&id=Net%20Income%20and%20EPS) Summary of net income and diluted EPS, along with income tax expense and effective tax rate | Metric | Q2 2025 ($ thousands) | Q1 2025 ($ thousands) | Q2 2024 ($ thousands) | YoY Change (Q2 2025 vs Q2 2024) | QoQ Change (Q2 2025 vs Q1 2025) | | :-------------------------------- | :-------------------- | :-------------------- | :-------------------- | :-------------------------------- | :-------------------------------- | | Net income available to common shareholders | 6,581 | 5,266 | 2,999 | +119.44% | +24.98% |\ | Earnings per common share – Diluted | 0.81 | 0.65 | 0.37 | +118.92% | +24.62% |\ | Income tax expense | 2,012 | 1,645 | 909 | +121.34% | +22.31% |\ | Effective tax rate | 23.4% | 23.8% | 23.3% | +0.1% | -0.4% | - Net income for Q2 2025 increased by **$1.3 million** from Q1 2025 and **$3.6 million** from Q2 2024[6](index=6&type=chunk) - The effective tax rate remained relatively stable, with minor fluctuations driven by equity compensation transactions[10](index=10&type=chunk) [Balance Sheet Overview](index=4&type=section&id=Balance%20Sheet%20Overview) Balance sheet as of June 30, 2025, shows growth in assets, loans, deposits, and shareholders' equity | Metric | Jun 30, 2025 ($ thousands) | Mar 31, 2025 ($ thousands) | Jun 30, 2024 ($ thousands) | YoY Change (Jun 30, 2025 vs Jun 30, 2024) | QoQ Change (Jun 30, 2025 vs Mar 31, 2025) | | :-------------------------- | :------------------------- | :------------------------- | :------------------------- | :------------------------------------------ | :------------------------------------------ |\ | Total assets | 4,308,067 | 4,284,311 | 4,109,849 | +4.82% | +0.55% |\ | Total cash and cash equivalents | 271,032 | 305,057 | 194,827 | +39.11% | -11.20% |\ | Total investment securities | 148,773 | 151,217 | 140,006 | +6.26% | -1.61% |\ | Loans, net | 3,705,556 | 3,643,232 | 3,582,364 | +3.44% | +1.71% |\ | Total liabilities | 3,962,605 | 3,946,713 | 3,791,101 | +4.52% | +0.40% |\ | Deposits | 3,636,329 | 3,620,886 | 3,459,869 | +5.10% | +0.43% |\ | Core deposits ($ thousands) | 2,867,193 | 2,820,194 | 2,788,223 | +2.8% | +1.7% (7% annualized) |\ | Total shareholders' equity | 345,462 | 337,598 | 318,748 | +8.38% | +2.33% | - Interest-bearing deposits with banks saw a substantial year-over-year increase of **636.45%**, reaching **$65.0 million**[13](index=13&type=chunk) - Subordinated debentures decreased by **31.54%** year-over-year, from **$36.38 million** to **$24.90 million**[13](index=13&type=chunk) [Asset Quality](index=5&type=section&id=Asset%20Quality) Asset quality remained stable in Q2 2025, with low nonperforming assets and increased allowance for credit losses [Nonperforming Assets](index=5&type=section&id=Nonperforming%20Assets) Detailed analysis of nonperforming assets, including composition and ratios relative to total assets and loans | Metric | Q2 2025 ($ thousands) | Q1 2025 ($ thousands) | Q2 2024 ($ thousands) | | :------------------------------------------ | :-------------------- | :-------------------- | :-------------------- | | Total nonperforming assets | 11,669 | 11,036 | 11,218 | | Nonperforming assets as a percentage of: | | | | | Total assets | 0.27% | 0.26% | 0.27% | | Total loans | 0.31% | 0.30% | 0.31% | | Classified assets/tier 1 capital plus allowance for credit losses | 4.28% | 4.24% | 4.22% | - Nonperforming assets to total assets remained stable at **0.27%** in Q2 2025, consistent with Q2 2024[14](index=14&type=chunk) - The classified asset ratio increased slightly to **4.28%** in Q2 2025 from **4.24%** in Q1 2025[14](index=14&type=chunk) [Allowance for Credit Losses & Net Charge-offs](index=5&type=section&id=Allowance%20for%20Credit%20Losses%20%26%20Net%20Charge-offs) Review of allowance for credit losses and net charge-offs, detailing changes and relationship to loan growth | Metric | Q2 2025 ($ thousands) | Q1 2025 ($ thousands) | Q2 2024 ($ thousands) | | :------------------------------------------ | :-------------------- | :-------------------- | :-------------------- | | Allowance for credit losses (end of period) | 41,285 | 40,687 | 40,157 | | Allowance for credit losses to gross loans | 1.10% | 1.10% | 1.11% | | Net charge-offs (recoveries) | (52) | 23 | (1,034) | | Net charge-offs (recoveries) to average loans QTD (annualized) | 0.01% | 0.00% | 0.11% | | Provision for credit losses | 650 | 750 | 750 | - The allowance for credit losses increased to **$41.3 million**, or **1.10%** of total loans, at June 30, 2025, from **$40.7 million** at March 31, 2025[15](index=15&type=chunk) - Net charge-offs were **$52 thousand** (**0.01%** annualized) for Q2 2025, compared to net recoveries of **$23 thousand** in Q1 2025 and net charge-offs of **$1.0 million** in Q2 2024[15](index=15&type=chunk) [Detailed Financial Data](index=2&type=section&id=Detailed%20Financial%20Data) Comprehensive unaudited financial statements, including income statements, balance sheets, asset quality, and loan/deposit compositions [Income Statements (Unaudited)](index=2&type=section&id=Income%20Statements%20%28Unaudited%29) Detailed unaudited income statements provide a breakdown of interest income, expenses, and net income | (in thousands, except per share data) | Jun 30 2025 | Mar 31 2025 | Dec 31 2024 | Sept 30 2024 | Jun 30 2024 | | :------------------------------------ | :---------- | :---------- | :---------- | :----------- | :---------- | | Interest income | | | | | | | Loans | $ 48,992 | $ 47,085 | $ 47,163 | $ 47,550 | $ 46,545 | | Investment securities | 1,357 | 1,403 | 1,504 | 1,412 | 1,418 | | Federal funds sold | 1,969 | 1,159 | 2,465 | 2,209 | 2,583 | | **Total interest income** | **52,318** | **49,647** | **51,132** | **51,171** | **50,546** | | Interest expense | | | | | | | Deposits | 24,300 | 23,569 | 25,901 | 27,725 | 28,216 | | Borrowings | 2,723 | 2,695 | 2,773 | 2,855 | 2,802 | | **Total interest expense** | **27,023** | **26,264** | **28,674** | **30,580** | **31,018** | | **Net interest income** | **25,295** | **23,383** | **22,458** | **20,591** | **19,528** | | Provision (reversal) for credit losses | 700 | 750 | (200) | - | 500 | | **Net interest income after provision for credit losses** | **24,595** | **22,633** | **22,658** | **20,591** | **19,028** | | Noninterest income | | | | | | | Mortgage banking income | 1,569 | 1,424 | 1,024 | 1,449 | 1,923 | | Service fees on deposit accounts | 567 | 539 | 499 | 455 | 423 | | ATM and debit card income | 586 | 552 | 607 | 599 | 587 | | Income from bank owned life insurance | 413 | 403 | 407 | 401 | 384 | | Other income | 199 | 196 | 242 | 271 | 206 | | **Total noninterest income** | **3,334** | **3,114** | **2,779** | **3,175** | **3,523** | | Noninterest expense | | | | | | | Compensation and benefits | 11,674 | 11,304 | 10,610 | 10,789 | 11,290 | | Occupancy | 2,523 | 2,548 | 2,587 | 2,595 | 2,552 | | Outside service and data processing costs | 2,189 | 2,037 | 2,003 | 1,930 | 1,962 | | Insurance | 910 | 1,010 | 1,077 | 1,025 | 965 | | Professional fees | 609 | 509 | 656 | 548 | 582 | | Marketing | 397 | 374 | 335 | 319 | 389 | | Other | 1,034 | 1,054 | 1,276 | 833 | 903 | | **Total noninterest expenses** | **19,336** | **18,836** | **18,544** | **18,039** | **18,643** | | Income before provision for income taxes | 8,593 | 6,911 | 6,893 | 5,727 | 3,908 | | Income tax expense | 2,012 | 1,645 | 1,266 | 1,345 | 909 | | **Net income available to common shareholders** | **$ 6,581** | **$ 5,266** | **$ 5,627** | **$ 4,382** | **$ 2,999** |\ | Earnings per common share – Basic | $ 0.81 | $ 0.65 | $ 0.70 | $ 0.54 | $ 0.37 |\ | Earnings per common share – Diluted | 0.81 | 0.65 | 0.70 | 0.54 | 0.37 | [Net Interest Income and Margin (Unaudited)](index=3&type=section&id=Net%20Interest%20Income%20and%20Margin%20%28Unaudited%29) Table details average balances, income/expense, and yields/rates for interest-earning assets and liabilities | (dollars in thousands) | June 30, 2025 Average Balance | June 30, 2025 Income/Expense | June 30, 2025 Yield/Rate | March 31, 2025 Average Balance | March 31, 2025 Income/Expense | March 31, 2025 Yield/Rate | June 30, 2024 Average Balance | June 30, 2024 Income/Expense | June 30, 2024 Yield/Rate | | :------------------------------------ | :---------------------------- | :--------------------------- | :----------------------- | :----------------------------- | :---------------------------- | :------------------------ | :---------------------------- | :--------------------------- | :----------------------- | | Interest-earning assets | | | | | | | | | | | Federal funds sold and interest-bearing deposits | $ 179,095 | $ 1,969 | 4.41% | $ 107,821 | $ 1,159 | 4.36% | $ 186,584 | $ 2,583 | 5.57% | | Investment securities, taxable | 141,898 | 1,315 | 3.72% | 143,609 | 1,361 | 3.84% | 133,507 | 1,376 | 4.15% | | Investment securities, nontaxable | 7,740 | 55 | 2.83% | 7,914 | 55 | 2.80% | 8,027 | 55 | 2.73% | | Loans | 3,724,064 | 48,992 | 5.28% | 3,673,912 | 47,085 | 5.20% | 3,645,595 | 46,545 | 5.14% | | **Total interest-earning assets** | **4,052,797** | **52,331** | **5.18%** | **3,933,256** | **49,660** | **5.12%** | **3,973,713** | **50,559** | **5.12%** | | Interest-bearing liabilities | | | | | | | | | | | NOW accounts | $ 331,811 | 752 | 0.91% | $ 306,707 | 597 | 0.79% | $ 302,881 | 621 | 0.82% | | Savings & money market | 1,566,345 | 13,398 | 3.43% | 1,520,632 | 12,750 | 3.40% | 1,611,991 | 16,324 | 4.07% | | Time deposits | 942,880 | 10,150 | 4.32% | 930,282 | 10,222 | 4.46% | 898,878 | 11,271 | 5.04% | | **Total interest-bearing deposits** | **2,841,036** | **24,300** | **3.43%** | **2,757,621** | **23,569** | **3.47%** | **2,813,750** | **28,216** | **4.03%** | | FHLB advances and other borrowings | 240,000 | 2,270 | 3.79% | 240,000 | 2,244 | 3.79% | 240,000 | 2,247 | 3.77% | | Subordinated debentures | 24,903 | 453 | 7.30% | 24,903 | 451 | 7.34% | 36,360 | 555 | 6.14% | | **Total interest-bearing liabilities** | **3,105,939** | **27,023** | **3.49%** | **3,022,524** | **26,264** | **3.52%** | **3,090,110** | **31,018** | **4.04%** | | Net interest spread | | | 1.69% | | | 1.60% | | | 1.08% | | Net interest income (tax equivalent) / margin | | $25,308 | 2.50% | | $23,396 | 2.41% | | $19,541 | 1.98% | [Balance Sheets (Unaudited)](index=4&type=section&id=Balance%20Sheets%20%28Unaudited%29) Unaudited balance sheets detail assets, liabilities, and shareholders' equity at various quarter-ends | (in thousands, except per share data) | Jun 30 2025 | Mar 31 2025 | Dec 31 2024 | Sep 30 2024 | Jun 30 2024 | | :------------------------------------ | :---------- | :---------- | :---------- | :---------- | :---------- | | Assets | | | | | | | Cash and due from banks | $ 25,184 | $ 24,904 | $ 22,553 | $ 25,289 | $ 21,567 | | Federal funds sold | 180,834 | 263,612 | 128,452 | 226,110 | 164,432 | | Interest-bearing deposits with banks | 65,014 | 16,541 | 11,858 | 9,176 | 8,828 | | **Total cash and cash equivalents** | **271,032** | **305,057** | **162,863** | **260,575** | **194,827** | | Investment securities available for sale | 128,867 | 131,290 | 132,127 | 134,597 | 121,353 | | Other investments | 19,906 | 19,927 | 19,490 | 19,640 | 18,653 | | **Total investment securities** | **148,773** | **151,217** | **151,617** | **154,237** | **140,006** | | Mortgage loans held for sale | 10,739 | 11,524 | 4,565 | 8,602 | 14,759 | | Loans | 3,746,841 | 3,683,919 | 3,631,767 | 3,619,556 | 3,622,521 | | Less allowance for credit losses | (41,285) | (40,687) | (39,914) | (40,166) | (40,157) | | **Loans, net** | **3,705,556** | **3,643,232** | **3,591,853** | **3,579,390** | **3,582,364** | | Bank owned life insurance | 54,886 | 54,473 | 54,070 | 53,663 | 53,263 | | Property and equipment, net | 85,921 | 87,369 | 88,794 | 90,158 | 91,533 | | Deferred income taxes | 12,971 | 13,080 | 13,467 | 11,595 | 12,339 | | Other assets | 18,189 | 18,359 | 20,364 | 16,411 | 20,758 | | **Total assets** | **$ 4,308,067** | **$ 4,284,311** | **$ 4,087,593** | **$ 4,174,631** | **$ 4,109,849** | | Liabilities | | | | | | | Deposits | $ 3,636,329 | $ 3,620,886 | $ 3,435,765 | $ 3,518,825 | $ 3,459,869 | | FHLB Advances | 240,000 | 240,000 | 240,000 | 240,000 | 240,000 | | Subordinated debentures | 24,903 | 24,903 | 24,903 | 24,903 | 36,376 | | Other liabilities | 61,373 | 60,924 | 56,481 | 64,365 | 54,856 | | **Total liabilities** | **3,962,605** | **3,946,713** | **3,757,149** | **3,848,093** | **3,791,101** | | Shareholders' equity | | | | | | | Common Stock | 82 | 82 | 82 | 82 | 82 | | Nonvested restricted stock | (2,774) | (3,372) | (3,884) | (4,219) | (4,710) | | Additional paid-in capital | 124,839 | 124,561 | 124,641 | 124,288 | 124,174 | | Accumulated other comprehensive loss | (9,609) | (10,016) | (11,472) | (9,063) | (11,866) | | Retained earnings | 232,924 | 226,343 | 221,077 | 215,450 | 211,068 | | **Total shareholders' equity** | **345,462** | **337,598** | **330,444** | **326,538** | **318,748** | | **Total liabilities and shareholders' equity** | **$ 4,308,067** | **$ 4,284,311** | **$ 4,087,593** | **$ 4,174,631** | **$ 4,109,849** |\ | Book value per common share | $ 42.23 | $ 41.33 | $ 40.47 | $ 40.04 | $ 39.09 |\ | Common shares outstanding | 8,181 | 8,169 | 8,165 | 8,156 | 8,155 | [Asset Quality Measures (Unaudited)](index=5&type=section&id=Asset%20Quality%20Measures%20%28Unaudited%29) Detailed unaudited asset quality measures include nonperforming assets, key ratios, and allowance for credit losses | (dollars in thousands) | June 30 2025 | March 31 2025 | December 31 2024 | September 30 2024 | June 30 2024 | | :------------------------------------------ | :----------- | :------------ | :--------------- | :---------------- | :----------- | | Nonperforming Assets | | | | | | | Commercial | | | | | | | Non-owner occupied RE | $ 6,941 | $ 6,950 | $ 7,641 | $ 7,904 | $ 7,949 | | Commercial business | 717 | 1,087 | 1,016 | 838 | 829 | | Consumer | | | | | | | Real estate | 3,028 | 2,414 | 1,908 | 2,448 | 1,875 | | Home equity | 708 | 310 | 312 | 393 | 565 | | Other | - | - | - | - | - | | **Total nonaccrual loans** | **11,394** | **10,761** | **10,877** | **11,583** | **11,218** | | Other real estate owned | 275 | 275 | - | - | - | | **Total nonperforming assets** | **$ 11,669** | **$ 11,036** | **$ 10,877** | **$ 11,583** | **$ 11,218** | | Nonperforming assets as a percentage of: | | | | | | | Total assets | 0.27% | 0.26% | 0.27% | 0.28% | 0.27% | | Total loans | 0.31% | 0.30% | 0.30% | 0.32% | 0.31% | | Classified assets/tier 1 capital plus allowance for credit losses | 4.28% | 4.24% | 4.25% | 4.35% | 4.22% | | Allowance for Credit Losses | | | | | | | Balance, beginning of period | $ 40,687 | $ 39,914 | $ 40,166 | $ 40,157 | $ 40,441 | | Loans charged-off | (68) | (78) | (143) | (118) | (1,049) | | Recoveries of loans previously charged-off | 16 | 101 | 141 | 127 | 15 | | Net loans (charged-off) recovered | (52) | 23 | (2) | 9 | (1,034) | | Provision for (reversal of) credit losses | 650 | 750 | (250) | - | 750 | | **Balance, end of period** | **$ 41,285** | **$ 40,687** | **$ 39,914** | **$ 40,166** | **$ 40,157** | | Allowance for credit losses to gross loans | 1.10% | 1.10% | 1.10% | 1.11% | 1.11% | | Allowance for credit losses to nonaccrual loans | 362.35% | 378.09% | 366.94% | 346.78% | 357.95% | | Net charge-offs (recoveries) to average loans QTD (annualized) | 0.01% | 0.00% | 0.00% | 0.00% | 0.11% | [Loan Composition (Unaudited)](index=6&type=section&id=Loan%20Composition%20%28Unaudited%29) Detailed loan portfolio breakdown by commercial and consumer categories across multiple quarters | (dollars in thousands) | June 30 2025 | March 31 2025 | December 31 2024 | September 30 2024 | June 30 2024 | | :------------------------------------ | :----------- | :------------ | :--------------- | :---------------- | :----------- | | Commercial | | | | | | | Owner occupied RE | $ 686,424 | $ 673,865 | $ 651,597 | $ 642,608 | $ 642,008 | | Non-owner occupied RE | 939,163 | 926,246 | 924,367 | 917,642 | 917,034 | | Construction | 68,421 | 90,021 | 103,204 | 144,665 | 144,968 | | Business | 589,661 | 561,337 | 556,117 | 521,535 | 527,017 | | **Total commercial loans** | **2,283,669** | **2,251,469** | **2,235,285** | **2,226,450** | **2,231,027** | | Consumer | | | | | | | Real estate | 1,164,187 | 1,147,357 | 1,128,629 | 1,132,371 | 1,126,155 | | Home equity | 234,608 | 223,061 | 204,897 | 195,383 | 189,294 | | Construction | 25,210 | 23,540 | 20,874 | 21,582 | 32,936 | | Other | 39,167 | 38,492 | 42,082 | 43,770 | 43,109 | | **Total consumer loans** | **1,463,172** | **1,432,450** | **1,396,482** | **1,393,106** | **1,391,494** | | **Total gross loans, net of deferred fees** | **3,746,841** | **3,683,919** | **3,631,767** | **3,619,556** | **3,622,521** | | Less—allowance for credit losses | (41,285) | (40,687) | (39,914) | (40,166) | (40,157) | | **Total loans, net** | **$ 3,705,556** | **$ 3,643,232** | **$ 3,591,853** | **$ 3,579,390** | **$ 3,582,364** | [Deposit Composition (Unaudited)](index=6&type=section&id=Deposit%20Composition%20%28Unaudited%29) Deposit composition table outlines non-interest bearing and various interest-bearing accounts | (dollars in thousands) | June 30 2025 | March 31 2025 | December 31 2024 | September 30 2024 | June 30 2024 | | :------------------------------------ | :----------- | :------------ | :--------------- | :---------------- | :----------- | | Non-interest bearing | $ 761,492 | $ 671,609 | $ 683,081 | $ 689,749 | $ 683,291 | | Interest bearing: | | | | | | | NOW accounts | 341,903 | 371,052 | 314,588 | 339,412 | 293,875 | | Money market accounts | 1,537,400 | 1,563,181 | 1,438,530 | 1,423,403 | 1,562,786 | | Savings | 32,334 | 32,945 | 31,976 | 29,283 | 28,739 | | Time, less than $250,000 | 194,064 | 181,407 | 193,562 | 223,582 | 219,532 | | Time and out-of-market deposits, $250,000 and over | 769,136 | 800,692 | 774,028 | 813,396 | 671,646 | | **Total deposits** | **$ 3,636,329** | **$ 3,620,886** | **$ 3,435,765** | **$ 3,518,825** | **$ 3,459,869** | [Additional Information](index=6&type=section&id=Additional%20Information) Background on Southern First Bancshares, forward-looking statements, and contact details [About Southern First Bancshares](index=6&type=section&id=About%20Southern%20First%20Bancshares) Southern First Bancshares, a South Carolina-based bank holding company, operates in 12 locations with $4.3 billion in assets - Southern First Bank is the **second largest bank** headquartered in South Carolina[21](index=21&type=chunk) - The bank operates in **12 locations** across Greenville, Columbia, and Charleston markets of South Carolina, Charlotte, Triangle and Triad regions of North Carolina, and Atlanta, Georgia[21](index=21&type=chunk) - Consolidated assets are approximately **$4.3 billion**[21](index=21&type=chunk) [Forward-Looking Statements](index=6&type=section&id=Forward-Looking%20Statements) Cautionary statement on forward-looking information, highlighting risks and uncertainties - Forward-looking statements are identified by words such as 'believe,' 'expect,' 'anticipate,' 'estimate,' and 'plan,' and are subject to risks and uncertainties[22](index=22&type=chunk) - Key risk factors include increased competitive pressures, general economic strength, changes in loan delinquencies and charge-offs, regulatory and legislative changes, adverse capital market conditions, interest rate fluctuations, and potential recessions[23](index=23&type=chunk) - The company does not undertake any obligation to update forward-looking statements, except as required by law[23](index=23&type=chunk) [Financial & Media Contact](index=7&type=section&id=Financial%20%26%20Media%20Contact) Contact information for financial and media inquiries is provided - Contact: Art Seaver at **864-679-9010**[24](index=24&type=chunk) - Website: **www.southernfirst.com**[24](index=24&type=chunk)

Financial Performance - Earnings per share increased to $0.81, a 25% increase QoQ and a 119% increase YoY[11] - Net interest margin increased to 2.50%, up from 2.41% in Q1 2025 and 1.98% in Q2 2024[11] - Book value per share increased to $42.23, a 9% annualized increase QoQ and an 8% increase YoY[11] - Total revenue reached a historically high level, driven by solid growth and pricing discipline[13, 14] Balance Sheet & Asset Quality - Total assets reached $4.3 billion[4] - Total loans amounted to $3.7 billion, with 7% annualized growth from Q1 2025[4, 22] - Total deposits reached $3.6 billion, including core deposits of $2.9 billion with 7% annualized growth from Q1 2025[4, 22] - Nonperforming assets (NPAs) stood at 0.27% of total assets[4, 27] Strategic Focus - The company operates 12 banking offices in 8 high-growth Southeast metro markets[9] - The company's Tier 1 RBC is 11.11%[9] - The company's office portfolio has a total credit exposure of $237 million, representing 5.4% of total loans[33]

Core Viewpoint - Southern First (SFST) is anticipated to report a year-over-year increase in earnings driven by higher revenues, with the consensus outlook suggesting a significant impact on its near-term stock price based on actual results compared to estimates [1][3]. Earnings Expectations - The upcoming earnings report is expected to show quarterly earnings of $0.65 per share, reflecting a year-over-year increase of +75.7% [3]. - Revenues are projected to reach $26.56 million, which is an increase of 15.2% from the same quarter last year [3]. Estimate Revisions - The consensus EPS estimate has been revised 2.82% higher in the last 30 days, indicating a reassessment by analysts [4]. - The Most Accurate Estimate for Southern First matches the Zacks Consensus Estimate, resulting in an Earnings ESP of 0% [12]. Earnings Surprise History - In the last reported quarter, Southern First exceeded the expected earnings of $0.61 per share, achieving $0.65, which was a surprise of +6.56% [13]. - The company has successfully beaten consensus EPS estimates in each of the last four quarters [14]. Industry Comparison - Synovus Financial (SNV), another player in the Southeast banking industry, is expected to report earnings of $1.25 per share, indicating a year-over-year change of +7.8% [18]. - Synovus's revenues are anticipated to be $583.84 million, up 90.7% from the previous year, with a consensus EPS estimate revised 1% higher in the last 30 days [19].

Core Viewpoint - Southern First Bancshares, Inc. has appointed three new board members to enhance its leadership and community engagement as it continues to grow its banking operations [1][5]. Company Overview - Southern First Bancshares, Inc. is a registered bank holding company based in Greenville, South Carolina, and operates Southern First Bank, the second largest bank headquartered in South Carolina [5]. - The company has consolidated assets of approximately $4.1 billion and trades on NASDAQ under the symbol "SFST" [5]. New Board Members - **Jennie Cluverius**: An experienced trial lawyer and shareholder at Maynard Nexsen, PC, specializing in labor and employment law. She holds a bachelor's degree from Clemson University and a J.D. from the University of South Carolina School of Law [2]. - **Darrin Goss**: Currently the President and CEO of the Coastal Community Foundation, with a background in community service and education. He has a bachelor's degree from Wofford College and a master's degree from North Greenville University [3]. - **Billy McClatchey**: CEO of Chaucer Creek Capital, with a focus on the Southeastern multifamily market. He has experience in mergers and acquisitions and holds an undergraduate degree from Duke University and an MBA from the University of North Carolina [4]. Leadership Statement - Art Seaver, CEO of Southern First Bancshares, expressed excitement about the new board members, highlighting their leadership qualities and community ties, which will aid in the bank's growth and impact [5].