Seacoast Banking of Florida(SBCF) - 2025 Q3 - Quarterly Report

Financial Performance - Net income for Q3 2025 was $36.5 million, or $0.42 per diluted share, a 19% increase compared to Q3 2024[113] - Adjusted net income for Q3 2025 rose 48% year-over-year to $45.2 million, or $0.52 per share[113] - For the nine months ended September 30, 2025, net income totaled $110.6 million, a 27% increase compared to the same period in 2024[114] - Net income for Q3 2025 was $36,467,000, a decrease of 14.3% from Q2 2025's $42,687,000 and an increase of 19.0% from Q3 2024's $30,651,000[146] - Adjusted net income for Q3 2025 reached $45,164,000, compared to $44,466,000 in Q2 2025 and $30,511,000 in Q3 2024, reflecting a year-over-year increase of 47.9%[146] - Earnings per diluted share for Q3 2025 was $0.42, down from $0.50 in Q2 2025 but up from $0.36 in Q3 2024[146] - Adjusted earnings per diluted share for Q3 2025 was $0.52, consistent with Q2 2025 and up from $0.36 in Q3 2024[146] Acquisitions - The acquisition of Heartland Bancshares, completed on July 11, 2025, added approximately $153.3 million in loans and $705.2 million in deposits[107] - The acquisition of Villages Bancorporation, completed on October 1, 2025, expanded the company's presence with 19 new branches[108] - Seacoast expects the Heartland acquisition to be accretive to earnings in 2026, with tangible book value dilution earned back in approximately two years[107] - Total assets increased by $1.5 billion, or 10%, to $16.7 billion as of September 30, 2025, including the acquisition of Heartland which added $823.5 million in assets[149] Asset and Loan Growth - Organic deposit growth was 7% annualized, while organic loan growth was 8% annualized[113] - Average loans increased by $246.1 million (2%) in Q3 2025 compared to Q2 2025, and by $676.3 million (7%) compared to Q3 2024[117] - Loans, net of unearned income, totaled $11.0 billion at September 30, 2025, a $664.2 million, or 6.4%, increase from December 31, 2024[158] - CRE owner-occupied loans increased by $212.1 million, or 13%, totaling $1.9 billion at September 30, 2025[163] - Residential real estate loans rose by $78.0 million to $2.7 billion at September 30, 2025, with $1.0 billion in fixed-rate mortgages and $1.0 billion in adjustable-rate mortgages[165] - Commercial and financial loans increased by $156.6 million, or 9%, totaling $1.8 billion at September 30, 2025[166] Interest Income and Margin - Net interest income for Q3 2025 was $133.5 million, a 5% increase from Q2 2025[113] - Net interest income for Q3 2025 was $133,468,000, an increase of 5.0% from $126,864,000 in Q2 2025 and up 25.1% from $106,665,000 in Q3 2024[146] - The yield on securities was 3.89% for the nine months ended September 30, 2025, compared to 3.65% for the same period in 2024[117] - Net interest margin decreased one basis point to 3.57% in Q3 2025, but increased 40 basis points from 3.17% in Q3 2024, driven by lower deposit costs[116] Deposits and Funding - Total deposits increased by $847.9 million, or 7%, to $13.1 billion at September 30, 2025, driven by customer growth and the Heartland acquisition[193] - The cost of average total deposits was 1.81% in Q3 2025, down from 2.34% in Q3 2024[120] - Noninterest demand deposits represented 28% of total deposits at September 30, 2025, compared to 27% at December 31, 2024[194] - The cost of funds was 1.96% in Q3 2025, down from 2.43% in Q3 2024[116] Noninterest Income and Expenses - Noninterest income for Q3 2025 totaled $23.8 million, a decrease of $0.7 million, or 3%, from Q2 2025, but an increase of $0.1 million, or 1%, from Q3 2024[128] - Noninterest expense for Q3 2025 was $102.0 million, an increase of $10.3 million, or 11%, from Q2 2025, and an increase of $17.2 million, or 20%, from Q3 2024[135] - Wealth management income reached $4.6 million in Q3 2025, up $0.4 million, or 9%, from Q2 2025, and up $0.7 million, or 19%, from Q3 2024, with assets under management increasing by $414.1 million, or 20%[129] Credit Quality - The allowance for credit losses was $141,285 thousand as of September 30, 2025, slightly improved from $145,579 thousand in the previous year[127] - Nonperforming assets (NPAs) decreased to $65.6 million, down 34% from $98.9 million at the end of 2024[177] - The ratio of allowance for credit losses to total loans was 1.34% at September 30, 2025, unchanged from December 31, 2024[184] - The Company recorded a provision expense of $8.4 million for Q3 2025, compared to $6.3 million in Q3 2024[183] Capital and Ratios - The company maintains a strong capital position with a Tier 1 capital ratio of 14.5% and a tangible common equity to tangible assets ratio of 9.8%[113] - Shareholders' equity increased to $2,345,233 thousand in Q3 2025, up from $2,252,208 thousand in Q2 2024, reflecting a growth of 4.13%[126] - The total risk-based capital ratio was 15.90% at September 30, 2025, well above the regulatory minimum of 10.00%[208] Interest Rate Sensitivity - The projected impact of a +3.00% change in interest rates on net interest income for the 1-12 months is a decrease of 5.2%[215] - The Economic Value of Equity (EVE) is sensitive to interest rate changes, with a projected decrease of 18.3% for a +3.00% rate change and an increase of 9.4% for a -2.00% rate change[225] - A gradual shift in interest rates would have a more modest impact on EVE compared to an instantaneous shift[225]