[First Quarter 2025 Highlights](index=1&type=section&id=First%20Quarter%202025%20Highlights) SouthState's Q1 2025 marked strategic transformations including the IBTX acquisition, sale-leaseback, and securities restructuring, resulting in adjusted EPS of $2.15 and a 3.85% net interest margin - The CEO described Q1 2025 as a "strategic reset" significantly improving the company's earnings profile, driven by the IBTX acquisition, a sale-leaseback, and a securities restructure which boosted the **net interest margin to 3.85%**[3](index=3&type=chunk) Q1 2025 Key Performance Metrics | Metric | Value | | :--- | :--- | | Diluted EPS (GAAP) | $0.87 | | Adjusted Diluted EPS (Non-GAAP) | $2.15 | | Net Income (GAAP) | $89.1 million | | Adjusted Net Income (Non-GAAP) | $219.3 million | | Net Interest Margin (NIM, TE) | 3.85% | | Adjusted ROAA (Non-GAAP) | 1.38% | | Adjusted ROATCE (Non-GAAP) | 19.9% | | Adjusted Efficiency Ratio (Non-GAAP) | 50% | - Key strategic transactions completed in Q1 2025 include the acquisition of Independent Bank Group, a sale-leaseback generating a **$229 million gain**, and a securities portfolio restructuring resulting in a **$229 million net loss**[6](index=6&type=chunk) - The Board of Directors declared a quarterly cash dividend of **$0.54 per share**, payable on May 16, 2025[6](index=6&type=chunk) [Financial Performance](index=2&type=section&id=Financial%20Performance) Q1 2025 saw net interest income rise to $544.5 million, total assets grow to $65.1 billion, and strong adjusted performance ratios [Consolidated Income Statement](index=2&type=section&id=Consolidated%20Income%20Statement) In Q1 2025, SouthState reported net interest income of $544.5 million, with GAAP net income of $89.1 million and adjusted net income of $219.3 million Q1 2025 Income Statement Highlights (vs. Q4 2024) | Metric (in thousands) | Q1 2025 | Q4 2024 | | :--- | :--- | :--- | | Net Interest Income | $544,547 | $369,779 | | Provision for credit losses | $100,562 | $6,371 | | Total Noninterest Income | $86,088 | $80,545 | | Total Noninterest Expense | $408,826 | $256,609 | | Net Income (GAAP) | $89,080 | $144,178 | | Adjusted Net Income (Non-GAAP) | $219,282 | $148,764 | | Diluted EPS (GAAP) | $0.87 | $1.87 | | Adjusted Diluted EPS (Non-GAAP) | $2.15 | $1.93 | [Performance and Capital Ratios](index=3&type=section&id=Performance%20and%20Capital%20Ratios) Q1 2025 adjusted performance ratios were strong, with ROAA at 1.38% and ROATCE at 19.85%, and robust capital ratios including an 11.0% Tier 1 Common Equity ratio Key Performance and Capital Ratios (Q1 2025 vs Q4 2024) | Ratio | Q1 2025 | Q4 2024 | | :--- | :--- | :--- | | Adjusted ROAA (Non-GAAP) | 1.38% | 1.27% | | Adjusted ROATCE (Non-GAAP) | 19.85% | 15.56% | | Adjusted Efficiency Ratio (Non-GAAP) | 50.24% | 54.42% | | Tangible Book Value per Share | $50.07 | $51.11 | | Tier 1 Common Equity Ratio | 11.0% | 12.6% | | Total Risk-Based Capital Ratio | 13.7% | 15.0% | [Consolidated Balance Sheet](index=4&type=section&id=Consolidated%20Balance%20Sheet) As of March 31, 2025, total assets increased to $65.1 billion, with loans at $46.1 billion and deposits at $53.3 billion, primarily due to the IBTX acquisition Balance Sheet Highlights (as of March 31, 2025 vs. Dec 31, 2024) | Metric (in thousands) | Mar 31, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Total Assets | $65,135,454 | $46,381,204 | | Loans, net | $46,143,042 | $33,437,647 | | Total Deposits | $53,337,615 | $38,060,866 | | Goodwill | $3,088,059 | $1,923,106 | | Total Shareholders' Equity | $8,624,361 | $5,890,415 | - The Independent acquisition added **$13.1 billion in loans** and **$15.2 billion in deposits**[27](index=27&type=chunk) [Detailed Financial Analysis](index=5&type=section&id=Detailed%20Financial%20Analysis) This section details the company's financial performance, including net interest margin expansion, noninterest income and expense, loan and deposit growth, and asset quality metrics post-acquisition [Net Interest Income and Margin](index=5&type=section&id=Net%20Interest%20Income%20and%20Margin) Net interest margin expanded by 37 basis points to 3.85% in Q1 2025, driven by a 6.25% total loan yield and $61.8 million in loan accretion income Net Interest Margin Analysis (Q1 2025 vs Q4 2024) | Metric | Q1 2025 | Q4 2024 | | :--- | :--- | :--- | | Net Interest Margin (TE, Non-GAAP) | 3.85% | 3.48% | | Total Loan Yield | 6.25% | 5.76% | | Total Deposit Cost | 1.89% | 1.75% | | Loan Accretion Income (in thousands) | $61,798 | $2,887 | - The remaining loan discount on acquired loans to be accreted into future interest income totals **$457.1 million** as of March 31, 2025[11](index=11&type=chunk) [Noninterest Income and Expense](index=6&type=section&id=Noninterest%20Income%20and%20Expense) Total noninterest income for Q1 2025 was $86.1 million, heavily influenced by offsetting one-time items, while noninterest expense rose to $408.8 million due to merger costs and expanded workforce - Noninterest income was significantly impacted by a **$229.3 million gain on a sale-leaseback**, which was nearly offset by a **$228.8 million net loss on securities**[13](index=13&type=chunk) Noninterest Expense Breakdown (Q1 2025 vs Q4 2024) | Expense Category (in thousands) | Q1 2025 | Q4 2024 | | :--- | :--- | :--- | | Salaries and employee benefits | $195,811 | $154,116 | | Occupancy expense | $35,493 | $22,831 | | Merger and restructuring expense | $68,006 | $6,531 | | **Total Noninterest Expense** | **$408,826** | **$256,609** | [Loan and Deposit Composition](index=7&type=section&id=Loan%20and%20Deposit%20Composition) At the end of Q1 2025, total loans reached $46.8 billion and total deposits grew to $53.3 billion, driven by the IBTX acquisition, with core deposits comprising $46.2 billion Loan Portfolio by Type (March 31, 2025) | Loan Category (in thousands) | Balance | | :--- | :--- | | Investor commercial real estate | $16,822,119 | | Consumer real estate | $9,838,952 | | Commercial and industrial | $8,106,484 | | Commercial owner occupied real estate | $7,417,116 | | Construction and land development | $3,497,909 | | **Total Loans** | **$46,766,732** | Deposit Composition (March 31, 2025) | Deposit Category (in thousands) | Balance | | :--- | :--- | | Money market | $17,447,738 | | Noninterest-bearing checking | $13,757,255 | | Interest-bearing checking | $12,034,973 | | Time deposits | $7,158,242 | | **Total Deposits** | **$53,337,615** | [Asset Quality and Credit Losses](index=8&type=section&id=Asset%20Quality%20and%20Credit%20Losses) Asset quality metrics in Q1 2025 reflect the Independent Bank portfolio addition, with nonperforming assets at 0.43% of total assets and an ACL of 1.33% of total loans Asset Quality Ratios (March 31, 2025) | Ratio | Value | | :--- | :--- | | Nonperforming assets as a % of total assets | 0.43% | | Nonperforming loans as a % of period end loans | 0.58% | | Allowance for credit losses as a % of loans | 1.33% | | Net charge-offs as a % of average loans (annualized) | 0.38% | | Net charge-offs (excl. acquisition date charge-offs) as a % of avg. loans | 0.04% | - The Allowance for Credit Losses (ACL) increased from **$465.3 million** to **$623.7 million**, primarily due to initial provisions for acquired loans from Independent[18](index=18&type=chunk) - The company recorded **$39.4 million in acquisition date charge-offs** on acquired PCD loans from Independent to conform with its own charge-off policies[6](index=6&type=chunk)[18](index=18&type=chunk) [Company and Shareholder Information](index=9&type=section&id=Company%20and%20Shareholder%20Information) This section provides details for investors, including the announcement of a quarterly dividend and information regarding the upcoming earnings conference call, and a brief overview of company operations [Dividend Declaration](index=1&type=section&id=Dividend%20Declaration) The Board of Directors declared a quarterly cash dividend of $0.54 per share, payable on May 16, 2025, to shareholders of record as of May 9, 2025 Q1 2025 Dividend Information | | Details | | :--- | :--- | | Dividend per Share | $0.54 | | Record Date | May 9, 2025 | | Payment Date | May 16, 2025 | [Conference Call Information](index=9&type=section&id=Conference%20Call%20Information) SouthState will host a conference call to discuss its Q1 2025 financial results on April 25, 2025, at 9:00 a.m. Eastern Time, with webcast access available on the investor relations website - A conference call to discuss Q1 2025 results is scheduled for **April 25, 2025, at 9:00 a.m. Eastern Time**[21](index=21&type=chunk) - SouthState Corporation is headquartered in Winter Haven, Florida, serving over one million customers across Florida, Alabama, Georgia, the Carolinas, Virginia, Texas, and Colorado through its bank subsidiary[22](index=22&type=chunk) [Non-GAAP Financial Measures](index=9&type=section&id=Non-GAAP%20Financial%20Measures) This section reconciles GAAP results to non-GAAP measures, which management uses to provide a clearer view of ongoing performance by adjusting for securities losses, sale-leaseback gains, merger expenses, and initial credit loss provisions Reconciliation of GAAP to Adjusted Net Income (Q1 2025, in thousands) | Description | Amount | | :--- | :--- | | **Net Income (GAAP)** | **$89,080** | | Securities losses, net of tax | $178,639 | | Gain on sale leaseback, net of tax | ($179,004) | | Initial PCL - Non-PCD loans & UFC, net of tax | $71,892 | | Merger & restructuring expense, net of tax | $53,094 | | Deferred tax asset remeasurement | $5,581 | | **Adjusted Net Income (Non-GAAP)** | **$219,282** | Reconciliation of GAAP to Adjusted Diluted EPS (Q1 2025) | Description | Amount | | :--- | :--- | | **Diluted EPS (GAAP)** | **$0.87** | | Effect of securities losses | $1.76 | | Effect of gain on sale leaseback | ($1.76) | | Effect of initial PCL | $0.71 | | Effect of merger & restructuring expense | $0.52 | | Effect of deferred tax remeasurement | $0.05 | | **Adjusted Diluted EPS (Non-GAAP)** | **$2.15** | - Management uses non-GAAP measures like Adjusted Net Income, Adjusted EPS, Tangible Book Value, and Adjusted Efficiency Ratio to provide additional useful information by excluding items such as merger costs, securities gains/losses, and other one-time events[23](index=23&type=chunk)[27](index=27&type=chunk) [Forward-Looking Statements](index=12&type=section&id=Forward-Looking%20Statements) The report includes forward-looking statements subject to significant risks and uncertainties, including economic volatility, merger integration, interest rate, credit, cybersecurity, and regulatory risks, with no commitment to updates - The report contains forward-looking statements based on management's current beliefs and assumptions, which are not guarantees of future performance[28](index=28&type=chunk) - Key risks that could cause actual results to differ include economic volatility, inflation, merger and integration risks with Independent Bank Group, interest rate, credit, and liquidity risks, competition, regulatory changes, cybersecurity, and geopolitical risks[29](index=29&type=chunk) - SouthState cautions readers not to place undue reliance on forward-looking statements and undertakes no obligation to update them[30](index=30&type=chunk)

Company Overview - SouthState (SSB) is expected to report earnings for the quarter ended March 2025 on April 24, 2025, with a consensus EPS estimate of $1.43, reflecting a year-over-year decline of 9.5% [3] - Revenue is anticipated to be $604.47 million, which represents a significant increase of 45.5% compared to the same quarter last year [3] Earnings Expectations - The consensus EPS estimate has remained unchanged over the last 30 days, indicating stability in analyst expectations [4] - The Most Accurate Estimate for SouthState is lower than the Zacks Consensus Estimate, resulting in an Earnings ESP of -23.21%, suggesting a bearish outlook from analysts [10] Historical Performance - SouthState has a history of beating consensus EPS estimates, having done so in the last four quarters, with the most recent surprise being +11.56% when it reported earnings of $1.93 against an expectation of $1.73 [12][13] Industry Comparison - In the Zacks Financial - Miscellaneous Services industry, Virtu Financial (VIRT) is expected to report earnings of $1.14 per share for the same quarter, indicating a year-over-year increase of 50% [17] - Virtu Financial's revenue is projected to be $460.2 million, up 25.4% from the previous year [17] - Despite a recent 2.3% downward revision in the consensus EPS estimate for Virtu Financial, a higher Most Accurate Estimate has resulted in a positive Earnings ESP of 3.08%, suggesting a likely earnings beat [18]

Group 1 - SouthState Bank has established a presence in Nashville, Tennessee, by hiring an experienced team to expand its operations in the region [1] - Cameron Wells has been appointed as division president, bringing over 20 years of experience in the banking sector, particularly in the Middle Tennessee market [1] - The bank aims to serve its Commercial and Middle Market customers in Nashville, leveraging its reputation for providing remarkable customer experiences [1] Group 2 - Will Hatfield has joined SouthState as director of Middle Market Banking, bringing 12 years of experience in Commercial and Small Business Banking [2] - Kelsea Lamia has been appointed as a Commercial banker, contributing 14 years of banking experience to the Nashville team [3] Group 3 - SouthState Corporation is headquartered in Winter Haven, Florida, and operates a nationally chartered bank subsidiary that serves over 1.5 million customers across multiple states [4]

Core Viewpoint - SouthState Bank's fifth Corporate Stewardship Report emphasizes its dedication to community engagement, employee support, corporate responsibility, and environmental sustainability [1][2]. Commitment to Community - The bank made $5.75 billion in Community Reinvestment Act (CRA)-eligible loans [9]. - It awarded grants and contributions totaling $7.1 million to 2,393 organizations [9]. - Extended $401 million in community development loans and invested $54.7 million in economic development and affordable housing projects [9]. Commitment to Colleagues - Recorded a 24% increase in employee volunteer hours, totaling 19,047 hours with 1,028 different organizations [9]. - Provided $242,000 in financial assistance to 166 team members through The Sunshine Fund [9]. - Continued the ReMARKable Leader program, with 61 team members graduating to enhance their career development [9]. - Maintained a diverse workforce, with 14.78% Black or African American and 7.78% Hispanic/Latino team members [9]. Commitment to Corporate Stewardship - The bank focuses on building meaningful relationships with community-based and nonprofit organizations [3]. - Maintained a tenured and diverse board of directors, with 50% having CEO-level experience [9]. Commitment to Environmental Resourcefulness - The bank's digital solutions have led to significant environmental savings, including 1.28 million gallons of water, 1.08 million pounds of CO2 emissions, and 70,000 pounds of solid waste [9]. - 58% of accounts are receiving eStatements, contributing to reduced environmental impact [9].

Core Insights - SouthState has announced a series of new hires and promotions across its Private Wealth, Small Business, and Commercial Banking divisions, emphasizing internal talent development and the addition of experienced bankers from other institutions [1][2]. Small Business Banking - The company has promoted Joseph Brice and Rob Pregnolato to lead the Small Business Banking Group for the Northern and Southern Groups, respectively [3]. - Four new Small Business bankers have been added under their leadership, including Peter Bevel, Andrew Leech, Tanesha Thrash, and Christy Truitt, each bringing extensive banking experience and community involvement [4][5][6][7]. Private Wealth Management - New Private Wealth advisors include Will Barlow, April Croasmun, Jennifer Thompson, and Steven Wickline, all of whom have significant experience in wealth management and investment strategies [8][9][10][12]. Commercial Banking - SouthState has welcomed three new members to its Commercial Banking team: Lauren Ervin, Matt Mehr, and Douglas Tuttle, each with over 20 years of experience in financial services and commercial banking [13][14][15]. Company Overview - SouthState Corporation, headquartered in Winter Haven, Florida, operates as a financial services company providing a range of solutions including consumer, commercial, mortgage, and wealth management to over 1.5 million customers across multiple states [16].

Core Points - SouthState Corporation will release its first quarter 2025 earnings results on April 24, 2025, after market close [1] - A conference call to discuss the earnings results is scheduled for April 25, 2025, at 9:00 a.m. (ET) [2] - Investors can access the earnings results and participate in the conference call through various means, including a live webcast [3]

WINTER HAVEN, Fla., March 27, 2025 /PRNewswire/ -- SouthState Bank has been named a top three bank in the nation for Small Business and Middle Market Banking, earning 23 total awards from Crisil Coalition Greenwich. In addition, SouthState has earned the most Best Bank Awards (tied) in the U.S. for Small Business Banking. SouthState Bank has been named a top three bank in the nation for Small Business and Middle Market Banking, earning 23 total awards from Crisil Coalition Greenwich. In addition, SouthS ...

Group 1 - The acquisition of Texas-based Independent Bank has been completed, positioning SouthState for growth in 2025 [1] - SouthState experienced better-than-expected loan growth in 2024, exiting the year with well above-average performance [1] - The company is well-prepared as a growth-oriented mid-cap bank heading into 2025 [1]

Financial Overview - As of December 31, 2024, SouthState Corporation had approximately $46.4 billion in assets, $33.9 billion in loans, $38.1 billion in deposits, and a market capitalization of approximately $7.6 billion[18]. - The loan portfolio consisted of 53% commercial real estate loans ($17.9 billion), 26% residential real estate loans ($8.7 billion), 18% commercial and industrial loans ($6.2 billion), and 3% other consumer loans ($1.1 billion) as of December 31, 2024[23][24][25][26]. - The deposit portfolio was comprised of 27% noninterest-bearing deposits and 73% interest-bearing deposits as of December 31, 2024[28]. - SouthState Corporation's revenue is primarily derived from interest on loans, fees from deposit accounts, and commissions on bond sales[19]. Employee and Workforce Management - As of December 31, 2024, the company had 4,986 full-time employees, a decrease from 5,070 in 2023, with a voluntary turnover rate of 9%[45]. - Approximately 96% of team members are located in six states, with South Carolina (32.5%) and Florida (32%) being the largest[45]. - In fiscal year 2024, the company hired 576 team members, with a management-level turnover rate of only 0.8%[45]. - The company completed over 200,000 training courses in 2024, emphasizing compliance and job-specific education[52]. - The company established a dashboard in 2024 to track metrics related to diversity, recruitment, and retention of talent[50]. - Approximately 27% of employees work remotely, reflecting the company's support for flexible work arrangements[55]. - The company has committed to building a diverse and inclusive workplace, with initiatives including unconscious bias training completed by over 600 leaders[49]. Regulatory Environment - The company is subject to extensive regulation and supervision, with increased scrutiny following the financial crisis and recent banking turmoil[60]. - The Bank's total assets exceeded $50 billion as a result of the merger with IBTX, effective January 1, 2025, which will subject it to heightened standards guidelines from the OCC starting in Q4 2026[76]. - The FDIC implemented a special assessment at an annual rate of approximately 13.4 basis points, projected to collect around $30.2 million from the Bank over eight quarters beginning in Q2 2024[83]. - The Company must maintain a common equity Tier 1 (CET1) capital conservation buffer of 2.5% to avoid restrictions on capital distributions, including dividends[88]. - The required capital ratios for the Company and the Bank include a CET1 risk-based capital ratio, a Tier 1 risk-based capital ratio, and a total capital ratio, with specific definitions for each[90]. - The OCC has the authority to limit dividends paid by the Bank if deemed unsafe or unsound, and all dividends must be paid from undivided profits after deducting expenses[87]. - The FDIC's risk-based deposit premium assessment system categorizes institutions into four risk categories based on capital levels and supervisory ratings[80]. - The Bank is subject to restrictions on lending to affiliates, with individual loans limited to 10% of the Bank's capital and surplus[70]. - The Company is required to provide prior notice to the Federal Reserve before acquiring 10% or more of its outstanding common stock[68]. - The Federal Reserve, OCC, and FDIC have broad supervisory and enforcement authority over the Company and the Bank, including the power to impose fines and initiate injunctive actions[77]. Capital and Financial Ratios - As of December 31, 2024, the Company's CET1 risk-based capital ratio was 12.62%, exceeding the minimum requirement of 4.5% and the well-capitalized standard of 6.5%[98]. - The Tier 1 risk-based capital ratio for the Company was 12.62%, significantly above the minimum requirement of 6.0% and the well-capitalized standard of 8.0%[98]. - The total risk-based capital ratio for the Company was 14.96%, well above the minimum requirement of 8.0% and the well-capitalized standard of 10.0%[98]. - The Tier 1 leverage ratio for the Company was 10.04%, exceeding the minimum requirement of 4.0%[98]. - The Company added approximately $15.3 million to Tier 1 capital as a result of the modified CECL transition as of December 31, 2024[100]. Mergers and Acquisitions - The IBTX Merger is expected to enhance revenues and strengthen the market position in Texas, with integration scheduled for the second quarter of 2025[143]. - The Company anticipates incurring substantial expenses related to the IBTX Merger and integration, which may exceed expected savings from eliminating duplicative expenses[147]. - The Company seeks to acquire financial institutions that are culturally similar and have experienced management to achieve economies of scale[215]. Risk Management - The Company is exposed to regulatory risks that could limit or restrict business activities, including changes in capital and liquidity requirements[139]. - The Company’s loan portfolio includes commercial and commercial real estate loans, which may carry higher risks of default[134]. - The Company is actively monitoring the impact of inflation and rising interest rates on its business and profitability[134]. - Effective management of credit risk and interest rate risk is crucial; failure to do so may adversely affect the company's business and financial condition[171]. - The company is exposed to credit risk if clients or counterparties default on obligations, which could negatively impact financial condition and results of operations[170]. - The company must manage liquidity risk effectively, including maintaining high-quality liquid assets and diversifying funding sources[175]. Technology and Cybersecurity - The company continues to invest significantly in information technology and cybersecurity systems, including cloud-based applications, to enhance functionality and security[204]. - The company experienced a cybersecurity incident in February 2024, leading to unauthorized activity in its systems and resulting in a pending class action lawsuit[214]. - The company has enhanced its cybersecurity defenses since the incident, but there is no assurance against future cyber-attacks or material losses[214]. - Cybersecurity risks have escalated with the growth of mobile payment and internet-based product offerings, increasing the potential for breaches[210]. - The company relies heavily on third-party service providers, which increases vulnerability to cyber-attacks and information security breaches[211]. Strategic Initiatives and Challenges - The company intends to pursue a growth strategy, but faces risks including economic conditions, regulatory compliance, and competition, which could adversely affect future growth opportunities[149]. - The company is integrating IBTX's business and expanding digital banking initiatives, including real-time payments and enhanced payment capabilities, to support growth[150]. - Future profitability may be impacted if strategic initiatives do not yield expected benefits or if expenses increase due to technology investments[151]. - The company faces risks related to the integration of IBTX, including potential delays and increased costs that could adversely affect financial performance[144]. - The company may face challenges in integrating operations and cultures following recent mergers, which could impact its corporate culture[196].

Core Viewpoint - SouthState (SSB) is positioned as a strong investment opportunity due to a significant revision in the company's earnings estimates, with an improving earnings outlook suggesting continued stock price gains [1][2]. Estimate Revisions - The rising trend in earnings estimate revisions reflects growing analyst optimism regarding SouthState's earnings prospects, which is expected to positively influence its stock price [2]. - For the current quarter, SouthState is projected to earn $1.32 per share, indicating a year-over-year decline of 16.46%. However, the Zacks Consensus Estimate has increased by 15.79% over the last 30 days due to one upward and one downward revision [4]. - For the full year, the earnings estimate is $8.12 per share, representing a year-over-year increase of 12.62%. The consensus estimate has risen by 8.71% as two estimates moved higher against one negative revision [5]. Zacks Rank - SouthState has achieved a Zacks Rank 1 (Strong Buy) due to favorable estimate revisions, indicating strong potential for outperformance compared to the S&P 500 [6]. - Historically, stocks with a Zacks Rank 1 have generated an average annual return of +25% since 2008, highlighting the effectiveness of this ranking system [3][6]. Stock Performance - SouthState shares have increased by 7.1% over the past four weeks, suggesting investor confidence in the company's earnings growth prospects driven by the positive estimate revisions [7].