Core Insights - The company is experiencing significant growth in business loans, with a year-over-year increase exceeding $400 million and a third-quarter growth of over $160 million compared to the previous quarter [1][3] - The net interest margin (NIM) has increased for six consecutive quarters, surpassing 3%, and is expected to expand further in the fourth quarter due to reduced deposit costs and maintained loan yields [2][11] - The company has a strong liquidity position with a core deposit-funded balance sheet, allowing it to capitalize on lending opportunities as they arise [2][8] Financial Performance - Core earnings per share for the third quarter reached $0.61, representing a 110% year-over-year increase [8] - The reported NIM for the third quarter increased to 3.1%, with total deposits up approximately $320 million compared to the prior quarter [8][10] - Core cash operating expenses for the third quarter were $61.9 million, slightly above prior guidance, primarily due to new hires [9][14] Loan and Deposit Trends - Loan originations, including new lines of credit, increased to $535 million, with a strong loan pipeline currently standing at $1.2 billion [1][5] - The cost of total deposits remained unchanged at 2.09% in the third quarter, with a notable increase in the spread between loans and deposits by approximately 10 basis points following the Fed rate cut [2][11] - Core deposits increased by $1 billion year-over-year, with the deposit teams growing their portfolios to approximately $2.6 billion [3][10] Future Outlook - The company anticipates more meaningful NIM expansion in the fourth quarter and significant opportunities in 2026 based on loan pricing and organic growth across deposits and loans [7][12] - There is a substantial back book repricing opportunity, with approximately $1.35 billion of adjustable and fixed-rate loans expected to reprice or mature in 2026, potentially leading to a 20 basis point increase in NIM [12][13] - The company is focused on organic growth and has plans to open new branch locations in New Jersey and Long Island in 2026 [6][28]

Financial Data and Key Metrics Changes - Core pre-tax, pre-provision income for Q3 2025 was $54.4 million, up from $49.4 million in Q2 2025 and $29.8 million year-over-year [3][4] - Core EPS for Q3 was $0.61, representing a 110% year-over-year increase [10] - Reported NIM increased to 3.01%, with a slight adjustment to 2.98% when excluding prepayment fees and purchase accounting [10][12] - Total deposits increased by approximately $320 million from the previous quarter [10] Business Line Data and Key Metrics Changes - Business loans grew over $160 million in Q3, compared to $110 million in Q2, with year-over-year growth exceeding $400 million [7] - Loan originations, including new lines of credit, reached $535 million, with a weighted average rate of approximately 6.95% [7] - Core deposits increased by $1 billion year-over-year, with a strong focus on growing the deposit portfolio [4] Market Data and Key Metrics Changes - Non-performing assets (NPAs) were up slightly but represented only 50 basis points of total assets, which is favorable compared to peers [4] - The credit side loans declined by approximately $30 million linked quarter, and loans 30 to 89 days past due decreased by 33% [11] Company Strategy and Development Direction - The company is focused on organic growth, particularly in business loans and core deposits, while managing its commercial real estate concentration ratio [8][38] - New branch openings in Manhattan and New Jersey are part of the strategy to expand market presence [8] - The company aims for significant NIM expansion in 2026 based on loan repricing opportunities and organic growth [14][38] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the credit quality and expects to resolve legacy NPAs in the fourth quarter [22] - The company anticipates a relatively flat balance sheet for the remainder of the year, with growth in business loans expected [15] - Management believes the industry is in the later innings of the current credit cycle, with a strong local economy supporting stability [49] Other Important Information - Non-interest income for the quarter was $12.2 million, including a $1.5 million recovery from a past fraud case [11][47] - The common equity tier 1 ratio grew to over 11.5%, and the total capital ratio increased to over 16% [11] Q&A Session Summary Question: Inquiry about charge-offs related to NPAs - Management clarified that charge-offs were primarily related to owner-occupied and non-owner-occupied commercial real estate, with no multifamily loans involved [21][22] Question: Expectations on multifamily payoffs and future prepayments - Management indicated that while there were significant payoffs this quarter, future prepayments are expected to normalize [24] Question: Discussion on normalized charge-offs in the context of new business verticals - Management stated that the guidance for charge-offs was around 20-30 basis points, with current levels at 31 basis points, and expects to return to historical levels over the next couple of quarters [30][31] Question: Thoughts on deposit betas amid potential rate cuts - Management expressed optimism about maintaining deposit costs and passing on rate cuts effectively, with current deposit costs in the low 190s [34][35] Question: Strategic alternatives including M&A considerations - Management emphasized a focus on organic growth and deploying excess liquidity rather than pursuing M&A at this time [38][45]

Financial Data and Key Metrics Changes - Core pre-tax, pre-provision income for Q3 2025 was $54.4 million, up from $49.4 million in Q2 2025 and $29.8 million year-over-year [3][4] - Core EPS for Q3 was $0.61, representing a 110% year-over-year increase [10] - Reported NIM increased to 3.01%, with a significant increase in the spread between loans and deposits following the Fed rate cut [10][5] Business Line Data and Key Metrics Changes - Business loans grew over $160 million in Q3, compared to $110 million in Q2, with year-over-year growth exceeding $400 million [7] - Loan originations, including new lines of credit, increased to $535 million, with a weighted average rate of approximately 6.95% [7] - Core deposits increased by $1 billion year-over-year, with total deposits up approximately $320 million from the prior quarter [4][10] Market Data and Key Metrics Changes - Non-performing assets (NPAs) were up slightly but represented only 50 basis points of total assets, which is favorable compared to peers [4] - The company maintained a strong liquidity position with a core deposit-funded balance sheet [4] Company Strategy and Development Direction - The company is focused on organic growth, particularly in business loans and core deposits, while managing its commercial real estate concentration ratio [8][38] - New branch openings in Manhattan and New Jersey are part of the strategy to expand market presence [8] - The company aims for NIM expansion in the fourth quarter and significant opportunities in 2026 based on loan repricing [8][14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the credit quality and expects resolution of legacy NPAs in Q4 [22] - The company anticipates a gradual improvement in NIM due to reduced deposit costs and stable loan yields [12][13] - Management believes the industry is in the later innings of the credit cycle, with a strong local economy and no significant stress expected [49] Other Important Information - Non-interest income for the quarter was $12.2 million, including a $1.5 million fraud recovery [11][46] - The common equity tier 1 ratio grew to over 11.5%, and total capital ratio increased to over 16% [11][12] Q&A Session Summary Question: Inquiry about charge-offs related to non-performing loans - Management clarified that charge-offs were primarily related to owner-occupied and non-owner-occupied commercial real estate, with no multifamily loans involved [21][22] Question: Expectations on multifamily payoffs and future prepayments - Management indicated that while there were significant payoffs this quarter, future prepayments are expected to normalize [24] Question: Discussion on normalized charge-offs and future expectations - Management stated that charge-offs are currently at 31 basis points and expect to return to historical levels as new businesses are built out [30][31] Question: Insights on deposit betas with potential rate cuts - Management noted that gradual rate cuts would help maintain deposit costs, with current costs in the low 190s [34][35] Question: Thoughts on M&A and strategic alternatives - Management emphasized a focus on organic growth and deploying excess liquidity rather than pursuing M&A at this time [38][45] Question: Discussion on stock repurchases given capital ratios - Management confirmed that discussions on stock repurchases have begun, with a focus on deploying capital effectively before considering buybacks [44][45]

Financial Data and Key Metrics Changes - Core earnings power showed significant growth with pre-tax, pre-provision income of $54.4 million in Q3 2025, up from $49.4 million in Q2 2025 and $29.8 million year-over-year [3][4] - Core EPS for Q3 was $0.61 per share, representing a 110% year-over-year increase [9] - Reported NIM increased to 3.01%, with a notable increase in the spread between loans and deposits by approximately 10 basis points following the Fed rate cut [9][12] Business Line Data and Key Metrics Changes - Business loans grew over $160 million in Q3 2025, compared to $110 million in Q2 2025, with year-over-year growth exceeding $400 million [6] - Loan originations, including new lines of credit, reached $535 million, with a weighted average rate of approximately 6.95% [6] - Core deposits increased by $1 billion year-over-year, with total deposits up approximately $320 million from the prior quarter [4][9] Market Data and Key Metrics Changes - Non-performing assets (NPAs) increased slightly but remained low at 50 basis points of total assets, which is favorable compared to peers [4] - The company maintained a strong liquidity position with a core deposit-funded balance sheet, allowing it to capitalize on lending opportunities [4][7] Company Strategy and Development Direction - The company is focused on organic growth, particularly in business loans and core deposits, while managing its commercial real estate concentration ratio [7][33] - New branch openings in Manhattan and New Jersey are part of the strategy to expand market presence [7] - The company aims for continued NIM expansion, with expectations for significant opportunities in 2026 based on loan repricing [7][12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the credit quality and expects to resolve legacy NPAs in Q4, projecting a stable NPA range [19][20] - The outlook for the credit cycle is cautiously optimistic, with expectations of muddling along rather than entering a significant stress environment [40] - Management anticipates a path to a structurally higher NIM and enhanced earnings power over time, with targets of 3.25% and 3.50% NIM in the future [12][13] Other Important Information - Non-interest income for the quarter was $12.2 million, including a $1.5 million fraud recovery from a legacy issue [10][38] - The company is considering stock repurchases as capital ratios improve, with a focus on deploying capital effectively [36][37] Q&A Session Summary Question: Inquiry about NPA formations and charge-offs - Management clarified that charge-offs were primarily related to owner-occupied and non-owner-occupied commercial real estate, with expectations for resolution of legacy NPAs in Q4 [19] Question: Expectations on charge-offs normalization - Management indicated that normalized charge-offs were expected to be around 20 to 30 basis points, with current levels at 31 basis points [25][27] Question: Market appetite for multifamily products - Management noted that there was no significant differentiation in refinancing between market rate and rent-regulated multifamily loans, with a high percentage of loans being refinanced [28] Question: Expectations on deposit betas with potential rate cuts - Management expressed confidence in maintaining deposit costs while growing deposits, with expectations of similar deposit betas in future rate cuts [29][30] Question: Thoughts on M&A and strategic alternatives - Management emphasized a focus on organic growth and deploying excess liquidity, while remaining open to maximizing shareholder value [33][34] Question: Discussion on stock repurchases - Management confirmed that discussions on stock repurchases have begun, with a focus on balancing capital deployment and maintaining a strong capital position [36][37]

Core Insights - Volta Finance reported a net performance of -0.8% for August 2025, with a year-to-date performance of +3.2%, underperforming compared to US High Yield and Euro High Yield returns of +6.3% and +4.0% respectively [4][5] Performance and Economic Context - Economic indicators showed a mixed picture in August, with weak labor market signals and high valuations in the tech sector raising concerns about economic momentum [5] - Inflation data remained elevated but aligned with expectations, leading to speculation about potential Federal Reserve rate cuts [5] - The Bank of England surprised markets with a rate cut to 4%, the lowest in over two years, amid ongoing inflation and political uncertainty [5] - Credit markets remained stable, with minor changes in spreads for Itraxx Xover and CDX indices [5] Loan and CLO Market Activity - The loan market saw significant repricing, with 28% of the market repriced year-to-date, resulting in approximately 20 basis points of spread compression [6] - Volta received an early redemption of approximately €7 million from a European CLO Equity position and reinvested €5.7 million into a Euro CLO debt tranche [7] Portfolio Performance - Volta's CLO Equity tranches returned -1.1%, while CLO Debt tranches returned +1.2% [8] - The EUR/USD exchange rate shift impacted long dollar exposure, contributing to a performance decline of -0.34% [8] Financial Position - As of the end of August 2025, Volta's Net Asset Value (NAV) was €271.8 million, equating to €7.43 per share [9] - Cash flow generation remained stable at €28 million equivalent in interest and coupons over the last six months, representing nearly 21% of August NAV on an annualized basis [7]

Core Viewpoint - SouthState Corporation (SSB) has shown strong performance with an 11.6% increase in shares over the past three months, outperforming the industry growth of 6.8% and its peers [1][8] Financial Performance - The Federal Reserve's recent interest rate cuts are expected to ease funding pressures and stabilize deposit costs, benefiting banks like SouthState [4] - SouthState's net interest income (NII) has achieved a five-year compound annual growth rate (CAGR) of 22.9% through 2024, with continued improvement in the first half of 2025 [5] - The net interest margin (NIM) improved in the first half of 2025 due to balance sheet optimization, despite a decline in 2024 from elevated funding costs [5][6] - Revenue growth is projected to continue, with estimates suggesting a year-over-year increase of 51.93% for 2025 and 4.76% for 2026 [9][10] Growth Strategies - SouthState has expanded its market presence through acquisitions, including the significant acquisition of Independent Bank in January 2025, which increased total assets to $65.1 billion [10][11] - The company has maintained strong organic growth, with a revenue CAGR of 21.5% over the past five years, continuing into the first half of 2025 [6][7] Liquidity and Shareholder Returns - SouthState has a solid liquidity position, with total debt of $1.2 billion against cash and cash equivalents of $3.5 billion as of June 30, 2025 [12] - The company has consistently raised dividends since 2020, with a recent hike of 11.1% in July 2025, resulting in a payout ratio of 26% and a five-year annualized dividend growth of 3.30% [13][16] Risks and Concerns - Elevated non-interest expenses have shown a CAGR of 16.6% from 2019 to 2024, driven by various operational costs [18] - The loan portfolio is heavily concentrated in real estate, with 72.9% of loans having real estate as collateral, increasing exposure to commercial real estate risks [20][21] Valuation - SouthState's trailing price-to-book (P/B) ratio of 1.15X is below the industry average of 1.88X, indicating that shares are trading at a discount compared to peers [23]

Core Financial Performance - The company reported a GAAP EPS of $0.41 for Q2 2025, marking a significant increase of 12,878% from Q2 2024, primarily due to fair value adjustments on debt and the reversal of a valuation allowance [2][11][18] - Core EPS also rose to $0.32, reflecting broad-based profitability improvements [3][11] - The GAAP net interest margin reached 2.54%, with a core net interest margin of 2.52%, both showing a quarter-over-quarter increase of 3 basis points [3][11][18] Deposit Growth and Composition - Average total deposits increased to $7.6 billion, up 6% year-over-year and 1% quarter-over-quarter [4][11][19] - Non-interest-bearing deposits grew to $875 million, representing a 6% year-over-year and 2% quarter-over-quarter increase [4][19] - The deposit mix remained stable, with uninsured and uncollateralized deposits accounting for only 17% of total deposits, reducing funding risk [8][36] Credit Quality and Risk Management - Pre-provision, pretax net revenue reached $23.1 million, the highest since 2022, with core PPNR at $19 million [5][11][20] - Net charge-offs were stable at 15 basis points, and non-performing assets remained at 75 basis points quarter-over-quarter [5][20] - Criticized and classified loans improved to 108 basis points from 133 basis points in the previous quarter, indicating enhanced credit quality [5][11][21] Loan Repricing and Future Income - The company identified $373 million of loans scheduled to reprice at rates 136 basis points higher by year-end 2025, with $2.1 billion set to reprice through 2027, providing a projected net interest income tailwind [6][27][39] - Multifamily loan retention was strong at 92%, with an average rate increase of 154 basis points [6][29] Strategic Initiatives and Market Focus - The company is focusing on core deposit growth in the Asian American community, with deposits in this segment reaching $1.4 billion and a compound annual growth rate of 12.4% since Q2 2022 [9][38] - Plans for branch expansion include a new location in Jackson Heights and a second branch in Chinatown [9][51] Expense Management and Guidance - The expected core non-interest expense growth for 2025 has been lowered to 4.5%-5.5% over a base of $159.6 million, attributed to reductions in incentive accruals and strict cost control [8][40][50] - The projected effective tax rate for the remainder of 2025 is between 24.5% and 26.5% [8][40]

Financial Data and Key Metrics Changes - The company reported net interest income of $123.5 million, which is $21 million higher than the first quarter of 2024 and slightly higher than the fourth quarter of 2024 [3] - Tangible book value increased by 3% since last quarter and 13% year-over-year, ending at $30.31 per share [2] - The common equity Tier 1 capital ratio stood at 11.4% and the risk-based capital ratio at 12.9% for the quarter [2] - The provision expense was $6.6 million, up $2.1 million from the first quarter of 2024 and $900,000 from the fourth quarter [6] - The allowance for credit losses ended the quarter at just over $165 million, an increase of about $576,000 from the fourth quarter [7] Business Line Data and Key Metrics Changes - Non-interest income decreased by about 7% compared to the first quarter of 2024, primarily due to a one-time benefit recorded in 2024, but normalized rates showed a 7% increase driven by higher service charges on deposit accounts [8] - Non-interest expense was down $789,000 compared to the fourth quarter of 2024 and flat compared to the first quarter of 2024, reflecting expense discipline despite a 5% growth in employee numbers [10] Market Data and Key Metrics Changes - The loan-to-deposit ratio stands at 89%, with an adjusted ratio of 77% when including correspondent Fed funds purchased [1] - The company anticipates over $1.9 billion in asset repricing over the next 12 months [6] Company Strategy and Development Direction - The company is focused on organic loan and deposit growth, priced competitively and profitably, with expectations of loan growth in low double digits [12][36] - There is an ongoing evaluation of new producers and potential hires to support expansion efforts [45] Management Comments on Operating Environment and Future Outlook - Management expressed optimism about the durability of Main Street compared to Wall Street, indicating a mixed impact from current market uncertainties [26] - The company does not foresee significant impacts from tariffs and remains optimistic about the balance of the year [28][32] Other Important Information - The company experienced a significant increase in Fed balances, averaging $380 million, which aids liquidity but negatively impacts margin calculations [2][4] - The company is looking for additional avenues to improve income without increasing risk, given the excess liquidity [61] Q&A Session Summary Question: How does the company view deposit trends for the rest of the year? - Management indicated that municipal deposits may decline as the year progresses, with correspondent balances leveling off after tax season [21][22] Question: What is the outlook for loan growth and demand post-pandemic? - Management noted a potential slowdown but remains optimistic about steady, granular growth across various markets [26][38] Question: What is the current loan pricing dynamic? - Loan pricing has remained steady, but management expressed dissatisfaction with current pricing levels, indicating they should be higher [43] Question: What is the expected range for non-interest expenses for the remainder of the year? - Non-interest expenses are expected to be in the range of $46 to $46.5 million, excluding potential new hires [45] Question: Can you provide details on non-performing loans? - Non-performing loans are primarily in the medical sector, including a hospital and a doctor with cash flow issues but good collateral [48][52]