Seacoast Banking of Florida(SBCF) - 2025 Q3 - Earnings Call Transcript

Financial Data and Key Metrics Changes - Adjusted net income increased 48% year over year to $45.2 million or $0.52 per share [5] - Organic deposits grew $212 million or 7% annualized, including $80 million in non-interest-bearing deposits [5][16] - Net interest income was $133.5 million, a 5% increase from the prior quarter, and net interest margin expanded 3 basis points to 3.32% [5][8] - Tangible book value per share increased 9% year over year to $17.61 [6][16] - Tier-one capital ratio is 14.5%, and tangible common equity to tangible assets ratio is 9.8% [6][16] Business Line Data and Key Metrics Changes - Wealth management achieved a record-breaking quarter with $258 million in new assets under management (AUM) [9] - Non-interest income, excluding securities activity, was $24.7 million, a 5% increase from the prior year quarter [9] - Non-interest expense increased to $102 million, including $10.8 million in merger-related expenses [10] Market Data and Key Metrics Changes - Loan outstandings, excluding the impact of the Heartland acquisition, increased at an annualized 8% [11] - The pipeline increased 30% to $1.2 billion, indicating strong demand across markets [11] - Customer transaction accounts represent 48% of total deposits, highlighting a relationship-focused approach [14] Company Strategy and Development Direction - The company is focused on organic growth and profitability goals while integrating recent acquisitions [17] - The Villages acquisition is expected to enhance liquidity and provide significant growth opportunities [3][17] - The company aims to maintain a disciplined credit culture while expanding its loan portfolio [12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the growth outlook and ability to deliver improvements and returns into 2026 [4][17] - The company anticipates continued high single-digit organic loan growth in the coming quarters [11] - Management noted that credit spreads are tight, but they are navigating the competitive landscape carefully [77] Other Important Information - The technology conversion for the Heartland acquisition was completed in Q3, and the Villages conversion is planned for early Q3 2026 [7][38] - The company has limited exposure to shared national credits or non-depository financial institutions [15] Q&A Session Summary Question: Growth outlook and pipeline momentum - Management highlighted impressive growth despite recent acquisitions and expressed confidence in maintaining high single-digit growth moving forward [22][24] Question: The Villages acquisition update - Management reported a smooth integration process and strong reception in the Villages market, with plans for extensive customer engagement [37][40] Question: Loan pricing and spreads - Management noted that credit spreads are tight and competitive, but they are being cautious in their approach [75][77] Question: Future investments and technology - Management confirmed ongoing investments in technology and infrastructure to support growth and enhance customer offerings [45][46]