Seacoast Reports Record Fourth Quarter and Full Year 2019 Results

| Source: Seacoast Banking Corporation of Florida Seacoast Banking Corporation of Florida

Full Year 2019 Net Income Increased 47% to $98.7 million

Continued Improvements in Operating Leverage and Record Loan Originations
Highlight 4Q Results

STUART, Fla., Jan. 23, 2020 (GLOBE NEWSWIRE) -- Seacoast Banking Corporation of Florida (“Seacoast” or the "Company”) (NASDAQ: SBCF) today reported fourth quarter 2019 net income of $27.2 million, or $0.52 per diluted share, an increase of 70%, or $11.2 million, year-over-year. For the full year 2019, net income was $98.7 million, or $1.90 per share, an increase of 47% year-over-year. Seacoast reported fourth quarter 2019 adjusted net income1 of $26.8 million, or $0.52 per diluted share, an increase of 12%, or $2.9 million, compared to the fourth quarter of 2018. For the full year 2019, adjusted net income1 was $104.6 million, or $2.01 per share, an increase of 32% year-over-year.

For the fourth quarter of 2019, return on average tangible assets was 1.66%, return on average tangible shareholders’ equity was 15.0%, and the efficiency ratio was 48.4%, compared to 1.05%, 10.9%, and 65.8%, respectively, in the fourth quarter of 2018. For the year ended December 31, 2019, return on average tangible assets was 1.56%, return on average tangible shareholders' equity was 14.7% and the efficiency ratio was 51.7% compared to 1.20%, 14.1% and 60.0% for the year ended December 31, 2018.

Adjusted return on average tangible assets1 was 1.57%, adjusted return on average tangible shareholders’ equity1 was 14.2%, and the adjusted efficiency ratio1 was 47.5% in the fourth quarter of 2019, compared to 1.49%, 15.4%, and 54.2%, respectively, in the fourth quarter of 2018. For the year ended December 31, 2019, adjusted return on average tangible assets1 was 1.58%, adjusted return on average tangible shareholders' equity1 was 14.9% and the adjusted efficiency ratio1 was 50.9%, compared to 1.35%, 14.1% and 56.1% for the year ended December 31, 2018.

Dennis S. Hudson, III, Seacoast’s Chairman and CEO, said, "The Seacoast team closed another record year with net income of $27.2 million for the fourth quarter and $98.7 million for the full year 2019. We continue to generate disciplined growth as reflected in record originations for the quarter of $587 million, while maintaining our strict underwriting guidelines and delivering continued improvements in operating leverage."

Hudson added, "During the quarter, we announced the upcoming acquisition of First Bank of the Palm Beaches. This acquisition builds upon our two previous Palm Beach County acquisitions and strengthens our presence in Florida's largest and the nation's seventh largest MSA. We are also excited to announce the acquisition of Fourth Street Banking Company, the holding company for Freedom Bank of St. Petersburg. This is an exceptional addition to our two previous acquisitions in the state's second largest MSA. The combination of this acquisition and the First Bank transaction will provide earnings per share accretion of more than 5% to 2021 and has minimal up front dilution to tangible book value per share, earned back in less than two years."

Charles M. Shaffer, Seacoast’s Chief Operating Officer and Chief Financial Officer, said, “We delivered another quarter of consistent growth in tangible book value per share, ending the period at $14.76, up 20% over the prior year. During the fourth quarter, net interest margin declined only 1 basis point excluding the impact of accretion of purchase discounts on acquired loans, demonstrating the exceptional quality of our balance sheet and customer franchise. This balance sheet is fortified with a robust capital base, strong asset quality and a prudent liquidity position. As the banking cycle continues to mature, Seacoast is committed to maintaining its fortress balance sheet, built on strong capital and strict credit underwriting.”

1Non-GAAP measure, see “Explanation of Certain Unaudited Non-GAAP Financial Measures" for more information and for a reconciliation to GAAP.

Fourth Quarter 2019 Financial Highlights

Income Statement

  • Net income was $27.2 million, or $0.52 per diluted share, compared to $25.6 million, or $0.49, for the prior quarter and $16.0 million, or $0.31, for the fourth quarter of 2018. For the year ended December 31, 2019, net income was $98.7 million, or $1.90 per diluted share, compared to $67.3 million, or $1.38, for the year ended December 31, 2018. Adjusted net income1 was $26.8 million, or $0.52 per diluted share, compared to $27.7 million, or $0.53, for the prior quarter and $23.9 million, or $0.47, for the fourth quarter of 2018. For the year ended December 31, 2019, adjusted net income1 was $104.6 million, or $2.01 per diluted share, compared to $79.1 million, or $1.62, for the year ended December 31, 2018.

  • Net revenues were $78.1 million, an increase of $3.2 million, or 4%, compared to the prior quarter, and an increase of $5.4 million, or 7%, compared to the fourth quarter of 2018. For the year ended December 31, 2019, net revenues were $300.4 million, an increase of $38.8 million, or 15%, compared to the year ended December 31, 2018. Adjusted revenues1 were $75.6 million, an increase of $0.8 million, or 1%, from the prior quarter and an increase of $2.8 million, or 4%, from the fourth quarter of 2018. For the year ended December 31, 2019, adjusted revenues1 were $298.2 million, an increase of $36.3 million, or 14%, compared to the year ended December 31, 2018.

  • Net interest income totaled $61.8 million, an increase of $0.8 million, or 1%, from the prior quarter and an increase of $1.8 million, or 3%, from the fourth quarter of 2018. For the year ended December 31, 2019, net interest income was $243.6 million, an increase of $32.1 million, or 15%, compared to the year ended December 31, 2018.

  • Net interest margin was 3.84% in the fourth quarter of 2019, 3.89% in the third quarter of 2019 and 4.00% in the fourth quarter of 2018. Quarter-over-quarter, the yield on loans contracted 17 basis points, the yield on securities contracted 12 basis points, and the cost of deposits decreased 12 basis points. The impact on net interest margin from accretion of purchase discounts on acquired loans was 21 basis points in the fourth quarter of 2019, compared to 25 basis points in the prior quarter and 27 basis points in the fourth quarter of 2018. Excluding the impact of accretion, the net interest margin decreased only 1 basis point from the prior quarter and the yield on loans contracted 13 basis points. Decreases in the yield on both loans and securities reflect the impact of a lower interest rate environment, affecting variable-rate portfolios and resulting in lower add-on rates for new loans originated and securities purchased.

  • Noninterest income totaled $16.4 million, an increase of $2.4 million, or 17%, compared to the prior quarter and an increase of $3.7 million, or 29%, from the fourth quarter of 2018. For the year ended December 31, 2019, noninterest income was $56.7 million, an increase of $6.7 million, or 13%, compared to the year ended December 31, 2018. Changes in noninterest income consisted of the following:

    • After a record third quarter boosted by refinance activity, mortgage banking fees decreased $0.6 million in the fourth quarter to $1.5 million. For the full year, mortgage banking fees increased $1.8 million, or 39%, to $6.5 million compared to the prior year, reflecting our strategic focus on generating saleable volume.
    • Interchange income increased $0.2 million, or 6%, in the fourth quarter, and $1.1 million, or 9%, for the full year, the result of increased transaction activity across a growing customer base.
    • Lower other income in the fourth quarter reflects the $1.0 million BOLI death benefit recorded in the third quarter partially offset by swap fees of $0.6 million in the fourth quarter of 2019.
    • During the quarter, securities gains of $2.5 million resulted from the opportunistic sale of $79.8 million of longer duration bonds yielding 2.8% transacted when the 10-year treasury rate declined early in the quarter.
  • The provision for loan losses was $4.8 million compared to $2.3 million in the prior quarter and $2.3 million in the fourth quarter of 2018. The increase in provision primarily reflects strong loan growth in the fourth quarter of 2019 and a modestly higher increase in net charge-offs during the fourth quarter when compared to the third quarter of 2019. Looking back over the last four quarters, net charge offs were 0.16% of average loans outstanding, in line with our expectations and reflecting continued strong asset quality trends.
  • Noninterest expense was $38.1 million, a decrease of $0.5 million, or 1%, compared to the prior quarter and a decrease of $11.4 million, or 23%, from the fourth quarter of 2018. For the year ended December 31, 2019, noninterest expense was $160.7 million, a decrease of $1.5 million, or 1%, compared to the year ended December 31, 2018. Changes from the third quarter of 2019 in noninterest expense consisted of the following:

    • Salaries and benefits decreased $1.0 million on a combined basis, the result of lower incentive accruals and our continued proven success at focusing on cost control across the franchise.
    • Legal and professional fees increased $0.4 million, including $0.6 million incurred in the fourth quarter for merger related activities.
    • Other expenses increased $0.6 million, including increases of $0.3 million in lending-related costs to support increased production and $0.2 million in recruiting and supporting the onboarding of new sales talent. For the full year, other expenses are down $2.0 million compared to 2018, reflecting our continued focus on efficiency and streamlining operations.
    • During the third quarter of 2019, the FDIC announced the achievement of their target deposit insurance reserve ratio, resulting in our ability to offset FDIC assessments with previously awarded credits. The Company has remaining credits of $0.7 million, which will be applied to future assessments if the FDIC’s reserve ratio remains above the target threshold.
  • Seacoast recorded $8.1 million in income tax expense in the fourth quarter of 2019, compared to $8.5 million in the prior quarter and $4.9 million in the fourth quarter of 2018. The prior quarter included net additional income tax expense of $0.7 million resulting from the change in the Florida corporate income tax rate.

  • Year to date adjusted revenues1 increased 14% compared to prior year while adjusted noninterest expense1 increased 3%, generating 11% operating leverage.

  • The efficiency ratio was 48.4% compared to 48.6% in the prior quarter and 65.8% in the fourth quarter of 2018. The adjusted efficiency ratio1 was 47.5% compared to 49.0% in the prior quarter and 54.2% in the fourth quarter of 2018.

Balance Sheet

  • At December 31, 2019, the Company had total assets of $7.1 billion and total shareholders' equity of $985.6 million. Book value per share was $19.13 and tangible book value per share was $14.76, compared to $18.70 and $14.30, respectively, at September 30, 2019 and $16.83 and $12.33, respectively, at December 31, 2018. Year-over-year, tangible book value per share increased 20%.

  • Debt Securities totaled $1.2 billion at December 31, 2019, an increase of $13.8 million compared to September 30, 2019 and a decrease of $15.6 million from December 31, 2018. During the quarter, securities gains of $2.5 million resulted from the opportunistic sale of $79.8 million of longer duration bonds yielding 2.8% transacted when the 10-year treasury rate declined early in the quarter.

  • Loans totaled $5.2 billion at December 31, 2019, an increase of $212.1 million, or 4%, compared to September 30, 2019, and an increase of $373.2 million, or 8%, from December 31, 2018. Changes in total loans consisted of the following:

    • New loan originations of $587 million, compared to $488 million in the prior quarter, contributed to net loan growth in the quarter of 17% on an annualized basis. Excluding the $99.0 million residential mortgage portfolio purchased during the quarter, net loan growth was 9% on an annualized basis. Loans outstanding have grown 8% year-over-year.
    • Commercial originations during the fourth quarter of 2019 were $247.0 million, a decrease of $35.2 million, or 12%, compared to the third quarter of 2019. Excluding the purchase of a $52.1 million commercial real estate loan portfolio in the third quarter of 2019, commercial originations increased in the fourth quarter $16.8 million, or 7%. Compared to the fourth quarter of 2018, commercial originations increased $87.6 million, or 55%.
    • Residential loan originations were $225.1 million in the fourth quarter of 2019, compared to $103.1 million in the third quarter of 2019 and $104.7 million in the fourth quarter of 2018. Originations in the fourth quarter of 2019 include the opportunistic purchase of a $99.0 million residential mortgage portfolio. Excluding that purchase, residential loan originations increased $28.8 million, or 30%, compared to the third quarter of 2019, and $21.3 million, or 20%, compared to the fourth quarter of 2018.
    • Consumer and small business originations for the fourth quarter of 2019 were $115.0 million, an increase of 12% compared to the third quarter of 2019 and an increase of 1% compared to the fourth quarter of 2018.
    • The Company continues to prudently manage commercial real estate exposure. Construction and land development and commercial real estate loans remain well below regulatory guidance at 40% and 204% of total bank-level risk based capital, respectively, compared to 42% and 204%, respectively, in the third quarter of 2019. On a consolidated basis, construction and land development and commercial real estate loans represent 38% and 191%, respectively, of total consolidated risk based capital.
    • The funded balances of our top 10 and top 20 relationships represented 21% and 39%, respectively, of total consolidated risk based capital, compared to 22% and 37% in the fourth quarter of 2018 and 34% and 54% in the fourth quarter of 2016. Our average commercial loan size is $365,000.

  • Pipelines (loans in underwriting and approval or approved and not yet closed) totaled $339.2 million at December 31, 2019.

    • Commercial pipelines were $256.0 million, an increase of 56% compared to December 31, 2018. The increase year-over-year reflects the successful addition of talent to our commercial banking team and better execution across the franchise.
    • Residential saleable pipelines were $19.0 million, an increase of 40% compared to December 31, 2018. The year-over-year increase reflects our continued strategic focus of generating saleable volume and the addition of talent across the franchise.
    • Retained residential pipelines were $19.1 million, a decrease of 37% compared to December 31, 2018. The year-over-year decrease reflects our continued strategic focus on generating saleable volume.
    • Consumer and small business pipelines were $45.1 million, a decrease of 16% compared to December 31, 2018.                                                                            
  • Total deposits were $5.6 billion as of December 31, 2019, a decrease of $88.4 million, or 2%, sequentially and an increase of $407.5 million, or 8%, from the prior year.
    • Overall cost of deposits declined to 61 basis points in the fourth quarter of 2019 from 73 basis points in the prior quarter, reflecting the impact of interest rate cuts in the second half of 2019 by the Federal Reserve. By keeping a targeted focus on customer acquisition and a relationship-driven strategy, the Company has successfully maintained discipline in deposit pricing.
    • Total transaction accounts increased 7% year-over-year, reflecting continued strong growth in core customer balances, and represent 50% of overall deposit funding.
    • Interest-bearing deposits (interest-bearing demand, savings and money market deposits) increased year-over-year $127.5 million, or 5%, to $2.8 billion, noninterest bearing demand deposits increased $20.9 million, or 1%, to $1.6 billion, and CDs (excluding brokered) increased $6.9 million, or 1%, to $712.2 million.
  • Fourth quarter return on average tangible assets (ROTA) was 1.66%, compared to 1.61% in the prior quarter and 1.05% in the fourth quarter of 2018. Adjusted ROTA1 was 1.57% compared to 1.67% in the prior quarter and 1.49% in the fourth quarter of 2018. The decline in adjusted ROTA1 in the current quarter reflects the impact of higher provision expense and substantial loan growth, partially offset by higher net interest income and lower noninterest expense.

Capital

  • Fourth quarter return on average tangible common equity (ROTCE) was 15.0%, compared to 14.7% in the prior quarter and 10.9% in the fourth quarter of 2018. Adjusted ROTCE1 was 14.2% compared to 15.3% in the prior quarter and 15.4% in the fourth quarter of 2018. The decline in adjusted ROTCE1 in the fourth quarter reflects the impact of a robust growing capital base.

  • The tier 1 capital ratio was 15.0%, total capital ratio was 15.7% and the tier 1 leverage ratio was 12.2% at December 31, 2019.

  • Tangible common equity to tangible assets was 11.1% at December 31, 2019, compared to 11.1% at September 30, 2019 and 9.7% at December 31, 2018.

Asset Quality

  • Nonperforming loans to total loans outstanding was 0.52% at December 31, 2019, 0.52% at September 30, 2019, and 0.55% at December 31, 2018.

  • Nonperforming assets to total assets was 0.55% at December 31, 2019, 0.58% at September 30, 2019 and 0.58% at December 31, 2018.

  • The ratio of allowance for loan losses to total loans was 0.68% at December 31, 2019, 0.67% at September 30, 2019, and 0.67% at December 31, 2018. The ratio of allowance for loan losses to non-acquired loans was 0.80% at December 31, 2019, 0.84% at September 30, 2019, and 0.89% at December 31, 2018.

  • Net charge-offs were $3.2 million, or 0.25%, of average loans for the fourth quarter of 2019 compared to $2.1 million, or 0.17%, of average loans in the third quarter of 2019 and $3.7 million, or 0.32% of average loans in the fourth quarter of 2018. Net charge-offs for the four most recent quarters averaged 0.16%, in line with our expectations for full year 2019.


FINANCIAL HIGHLIGHTS       
(Amounts in thousands except per share data)(Unaudited)
 Quarterly Trends
          
 4Q'19 3Q'19 2Q'19 1Q'19 4Q'18
Selected Balance Sheet Data:         
Total Assets$7,108,511  $6,890,645  $6,824,886  $6,783,389  $6,747,659 
Gross Loans5,198,404  4,986,289  4,888,139  4,828,441  4,825,214 
Total Deposits5,584,753  5,673,141  5,541,209  5,605,578  5,177,240 
          
Performance Measures:         
Net Income$27,176  $25,605  $23,253  $22,705  $15,962 
Net Interest Margin3.84% 3.89% 3.94% 4.02% 4.00%
Average Diluted Shares Outstanding52,081  51,935  51,952  52,039  51,237 
Diluted Earnings Per Share (EPS)$0.52  $0.49  $0.45  $0.44  $0.31 
Return on (annualized):         
Average Assets (ROA)1.54% 1.49% 1.38% 1.36% 0.96%
Average Tangible Assets (ROTA)1.66  1.61  1.50  1.48  1.05 
Average Tangible Common Equity (ROTCE)14.95  14.73  14.30  14.86  10.94 
Efficiency Ratio48.36  48.62  53.48  56.55  65.76 
          
Adjusted Operating Measures1:         
Adjusted Net Income$26,837  $27,731  $25,818  $24,205  $23,893 
Adjusted Diluted EPS0.52  0.53  0.50  0.47  0.47 
Adjusted ROTA1.57% 1.67% 1.59% 1.50% 1.49%
Adjusted ROTCE14.19  15.30  15.17  15.11  15.44 
Adjusted Efficiency Ratio47.52  48.96  51.44  55.81  54.19 
Adjusted Noninterest Expense as a
Percent of Average Tangible Assets		2.11  2.22  2.34  2.55  2.46 
          
Other Data:         
Market capitalization2$1,574,775  $1,303,010  $1,309,158  $1,354,759  $1,336,415 
Full-time equivalent employees867  867  852  902  902 
Number of ATMs78  80  81  84  87 
Full service banking offices48  48  49  50  51 
Registered online users109,684  107,241  104,017  102,274  99,415 
Registered mobile devices99,361  96,384  92,281  87,844  83,151 
1Non-GAAP measure, see “Explanation of Certain Unaudited Non-GAAP Financial Measures" for more information and a reconciliation to GAAP
2Common shares outstanding multiplied by closing bid price on last day of each period
 

Vision 2020

Seacoast remains confident in the Company's ability to achieve Vision 2020 targets announced in February 2017.

  Vision 2020 Targets 
 Return on Tangible Assets1.30% + 
 Return on Tangible Common Equity16% + 
 Efficiency RatioBelow 50% 

Since announcing Vision 2020 targets in February 2017, the Company has achieved a compounded annual growth rate in tangible book value per share of 13%, steadily building shareholder value.

Fourth Quarter and Full Year 2019 Operating Highlights

Modernizing How Seacoast Sells

  • In 2019, interchange income increased by $1.1 million, or 9%, compared to the prior year as Seacoast’s debit card program surpassed $1 billion in retail sales. The Company’s debit card program consistently performs in the top quartile of Visa partner banks of similar size.

  • Seacoast Wealth Management added approximately $140 million in new assets under management in 2019, growing 27% year-over-year. Growth in assets under management, industry leading products and investments in sales and support teams throughout the footprint resulted in a 7% increase year-over-year in wealth related revenue.

  • Seacoast has partnered with a leading consumer insights firm to capture and analyze feedback from customers. Program implementation and launch were completed in the third quarter of 2019, with the objective of identifying additional customer opportunities.

Lowering Cost to Serve

  • Seacoast consolidated three banking center locations in 2019, achieving the Vision 2020 objective of reducing the footprint by 20% to meet evolving customer needs. At December 31, 2019, deposits per banking center exceeded $116 million compared to $102 million at December 31, 2018. 

Driving Improvements to Operations

  • In 2019, Seacoast's continued focus on efficiency and streamlining operations improved adjusted noninterest expenses1 as a percent of average tangible assets to 2.11% in the fourth quarter compared to 2.46% a year ago.

  • Earlier this year, Seacoast further enhanced the interactive voice response (IVR) system in the Florida-based Customer Support Center. The system provides customers with secure, self-serve options and expedites call routing processes. During the fourth quarter of 2019, more than 215,000 routine customer service calls were serviced solely by the IVR system. This represented 71% of total customer service calls received. This investment should continue to provide added scalability and elevate the customer experience in 2020.

  • Late in 2018, Seacoast launched a large-scale initiative to implement a fully digital loan origination platform across all business banking units. In the fourth quarter of 2019, this platform enabled record loan originations in the commercial banking team. The Company recognized $350,000 in annualized expense reductions as a result of this platform implementation. This investment should lead to further gains in operational efficiency and banker productivity in 2020 and beyond.

Scaling and Evolving Seacoast's Culture

  • Seacoast's balanced growth strategy, combining organic growth with value-creating acquisitions, continues to benefit shareholders and provide new opportunities for associates. The pending acquisitions of First Bank of the Palm Beaches and Fourth Street Banking Company, subject to shareholder and regulatory approvals, will add experienced bankers in two growing markets and will further support the Company's sustainable and profitable growth.

OTHER INFORMATION

Conference Call Information
Seacoast will host a conference call on January 24, 2020 at 10:00 a.m. (Eastern Time) to discuss the fourth quarter and full year 2019 earnings results and business trends. Investors may call in (toll-free) by dialing (888) 517-2513 (passcode: 7556 513; host: Dennis S. Hudson). Charts will be used during the conference call and may be accessed at Seacoast's website at www.SeacoastBanking.com by selecting "Presentations" under the heading "News/Events." A replay of the call will be available for one month, beginning late afternoon of January 24, 2020 by dialing (888) 843-7419 (domestic) and using passcode: 7556 513#.

Alternatively, individuals may listen to the live webcast of the presentation by visiting Seacoast's website at www.SeacoastBanking.com. The link is located in the subsection "Presentations" under the heading "Investor Services." Beginning the afternoon of January 24, 2020, an archived version of the webcast can be accessed from this same subsection of the website. The archived webcast will be available for one year.

About Seacoast Banking Corporation of Florida (NASDAQ: SBCF)
Seacoast Banking Corporation of Florida is one of the largest community banks headquartered in Florida with approximately $7.1 billion in assets and $5.6 billion in deposits as of December 31, 2019. The Company provides integrated financial services including commercial and retail banking, wealth management, and mortgage services to customers through advanced banking solutions, and 48 traditional branches of its locally-branded, wholly-owned subsidiary bank, Seacoast Bank. Offices stretch from Fort Lauderdale, Boca Raton and West Palm Beach north through the Daytona Beach area, into Orlando and Central Florida and the adjacent Tampa market, and west to Okeechobee and surrounding counties. More information about the Company is available at www.SeacoastBanking.com.

Additional Information
Seacoast has filed a registration statement on Form S-4 with the United States Securities and Exchange Commission (the “SEC”) in connection with the proposed merger of First Bank of the Palm Beaches (“First Bank”) with and into Seacoast Bank and will file a registration statement on Form S-4 with the SEC in connection with the proposed merger of Fourth Street Banking Company (“Fourth Street”) with and into Seacoast and Freedom Bank with and into Seacoast Bank. The registration statement in connection with the First Bank merger includes a proxy statement of First Bank and a prospectus of Seacoast and the registration statement in connection with the Fourth Street merger will include a proxy statement of Fourth Street and a prospectus of Seacoast. A definitive proxy statement/prospectus will be mailed to shareholders of First Bank and Fourth Street.  This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval.  WE URGE INVESTORS TO READ THE PROXY STATEMENTS/PROSPECTUSES AND ANY OTHER DOCUMENTS TO BE FILED WITH THE SEC IN CONNECTION WITH THE MERGERS OR INCORPORATED BY REFERENCE IN THE PROXY STATEMENTS/PROSPECTUSES BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION.

Investors may obtain (when available) these documents free of charge at the SEC’s Web site (www.sec.gov).  In addition, documents filed with the SEC by Seacoast will be available free of charge by contacting Investor Relations at (772) 288-6085.

First Bank and Fourth Street, their directors, and executive officers and other members of management and employees may be considered participants in the solicitation of proxies in connection with the proposed mergers of First Bank with and into Seacoast Bank and Fourth Street with and into Seacoast. Information regarding the participants in the proxy solicitation of First Bank and a description of their direct and indirect interests, by security holdings or otherwise, is contained in the proxy statement/prospectus and other relevant materials to be filed with the SEC. Information regarding the participants in the proxy solicitation of Fourth Street and a description of their direct and indirect interests, by security holdings or otherwise, will be contained in the proxy statement/prospectus and other relevant materials to be filed with the SEC.

Cautionary Notice Regarding Forward-Looking Statements
This press release contains "forward-looking statements" within the meaning, and protections, of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including, without limitation, statements about future financial and operating results, cost savings, enhanced revenues, economic and seasonal conditions in our markets, and improvements to reported earnings that may be realized from cost controls, tax law changes, new initiatives and for integration of banks that we have acquired, or expect to acquire, including First Bank, as well as statements with respect to Seacoast's objectives, strategic plans, including Vision 2020, expectations and intentions and other statements that are not historical facts. Actual results may differ from those set forth in the forward-looking statements.

Forward-looking statements include statements with respect to our beliefs, plans, objectives, goals, expectations, anticipations, assumptions, estimates and intentions about future performance and involve known and unknown risks, uncertainties and other factors, which may be beyond our control, and which may cause the actual results, performance or achievements of Seacoast to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. You should not expect us to update any forward-looking statements.

All statements other than statements of historical fact could be forward-looking statements. You can identify these forward-looking statements through our use of words such as "may", "will", "anticipate", "assume", "should", "support", "indicate", "would", "believe", "contemplate", "expect", "estimate", "continue", "further", "plan", "point to", "project", "could", "intend", "target" or other similar words and expressions of the future. These forward-looking statements may not be realized due to a variety of factors, including, without limitation: the effects of future economic and market conditions, including seasonality; governmental monetary and fiscal policies, including interest rate policies of the Board of Governors of the Federal Reserve, as well as legislative, tax and regulatory changes; changes in accounting policies, rules and practices; the risks of changes in interest rates on the level and composition of deposits, loan demand, liquidity and the values of loan collateral, securities, and interest sensitive assets and liabilities; interest rate risks, sensitivities and the shape of the yield curve; uncertainty related to the impact of LIBOR calculations on securities and loans; changes in borrower credit risks and payment behaviors; changes in the availability and cost of credit and capital in the financial markets; changes in the prices, values and sales volumes of residential and commercial real estate; our ability to comply with any regulatory requirements; the effects of problems encountered by other financial institutions that adversely affect us or the banking industry; our concentration in commercial real estate loans; the failure of assumptions and estimates, as well as differences in, and changes to, economic, market and credit conditions; the impact on the valuation of our investments due to market volatility or counterparty payment risk; statutory and regulatory dividend restrictions; increases in regulatory capital requirements for banking organizations generally; the risks of mergers, acquisitions and divestitures, including our ability to continue to identify acquisition targets and successfully acquire desirable financial institutions; changes in technology or products that may be more difficult, costly, or less effective than anticipated; our ability to identify and address increased cybersecurity risks; inability of our risk management framework to manage risks associated with our business; dependence on key suppliers or vendors to obtain equipment or services for our business on acceptable terms; reduction in or the termination of our ability to use the mobile-based platform that is critical to our business growth strategy; the effects of war or other conflicts, acts of terrorism, natural disasters or other catastrophic events that may affect general economic conditions; unexpected outcomes of, and the costs associated with, existing or new litigation involving us; our ability to maintain adequate internal controls over financial reporting; potential claims, damages, penalties, fines and reputational damage resulting from pending or future litigation, regulatory proceedings and enforcement actions; the risks that our deferred tax assets could be reduced if estimates of future taxable income from our operations and tax planning strategies are less than currently estimated and sales of our capital stock could trigger a reduction in the amount of net operating loss carryforwards that we may be able to utilize for income tax purposes; the effects of competition from other commercial banks, thrifts, mortgage banking firms, consumer finance companies, credit unions, securities brokerage firms, insurance companies, money market and other mutual funds and other financial institutions operating in our market areas and elsewhere, including institutions operating regionally, nationally and internationally, together with such competitors offering banking products and services by mail, telephone, computer and the Internet; and the failure of assumptions underlying the establishment of reserves for possible loan losses.

The risks relating to the proposed First Bank and Fourth Street mergers include, without limitation: the timing to consummate the proposed mergers; the risk that a condition to closing of the proposed mergers may not be satisfied; the risk that a regulatory approval that may be required for the proposed mergers is not obtained or is obtained subject to conditions that are not anticipated; the diversion of management time on issues related to the proposed mergers; unexpected transaction costs, including the costs of integrating operations; the risks that the businesses will not be integrated successfully or that such integration may be more difficult, time- consuming or costly than expected; the potential failure to fully or timely realize expected revenues and revenue synergies, including as the result of revenues following the mergers being lower than expected; the risk of deposit and customer attrition; any changes in deposit mix; unexpected operating and other costs, which may differ or change from expectations; the risks of customer and employee loss and business disruptions, including, without limitation, as the result of difficulties in maintaining relationships with employees; increased competitive pressures and solicitations of customers by competitors; as well as the difficulties and risks inherent with entering new markets.

All written or oral forward-looking statements attributable to us are expressly qualified in their entirety by this cautionary notice, including, without limitation, those risks and uncertainties described in our annual report on Form 10-K for the year ended December 31, 2018, under "Special Cautionary Notice Regarding Forward-looking Statements" and "Risk Factors", and otherwise in our SEC reports and filings. Such reports are available upon request from the Company, or from the Securities and Exchange Commission, including through the SEC's Internet website at www.sec.gov.

 

FINANCIAL  HIGHLIGHTS(Unaudited)     
SEACOAST  BANKING  CORPORATION  OF  FLORIDA  AND  SUBSIDIARIES       
   
 Quarterly Trends Twelve  Months Ended 
               
(Amounts in thousands, except ratios and per share data)4Q'19 3Q'19 2Q'19 1Q'19 4Q'18 4Q'19 4Q'18 
               
Summary of Earnings              
Net income$27,176  $25,605  $23,253  $22,705  $15,962  $98,739  $67,275  
Adjusted net income126,837  27,731  25,818  24,205  23,893  104,591  79,085  
Net interest income261,846  61,027  60,219  60,861  60,100  243,953  211,956  
Net interest margin2,33.84% 3.89% 3.94% 4.02% 4.00% 3.92% 3.85% 
               
Performance Ratios              
Return on average assets-GAAP basis31.54% 1.49% 1.38% 1.36% 0.96% 1.45% 1.11% 
Return on average tangible assets-GAAP basis3,41.66  1.61  1.50  1.48  1.05  1.56  1.20  
Adjusted return on average tangible assets1,3,41.57  1.67  1.59  1.50  1.49  1.58  1.35  
               
Return on average shareholders' equity-GAAP basis311.04  10.73  10.23  10.47  7.65  10.63  9.08  
Return on average tangible common equity-GAAP basis3,414.95  14.73  14.30  14.86  10.94  14.72  12.54  
Adjusted return on average tangible common equity1,3,414.19  15.30  15.17  15.11  15.44  14.93  14.06  
Efficiency ratio548.36  48.62  53.48  56.55  65.76  51.71  59.98  
Adjusted efficiency ratio147.52  48.96  51.44  55.81  54.19  50.90  56.13  
Noninterest income to total revenue (excluding securities gains/losses)18.30  19.53  18.93  17.45  17.97  18.56  19.32  
Tangible common equity to tangible assets411.05  11.05  10.65  10.18  9.72  11.05  9.72  
Average loan-to-deposit ratio90.71  88.35  87.27  90.55  89.14  89.21  85.85  
End of period loan-to-deposit ratio93.44  88.36  88.53  86.38  93.43  93.44  93.43  
               
Per Share Data              
Net income diluted-GAAP basis$0.52  $0.49  $0.45  $0.44  $0.31  $1.90  $1.38  
Net income basic-GAAP basis0.53  0.50  0.45  0.44  0.32  1.92  1.40  
Adjusted earnings10.52  0.53  0.50  0.47  0.47  2.01  1.62  
               
Book value per share common19.13  18.70  18.08  17.44  16.83  19.13  16.83  
Tangible book value per share14.76  14.30  13.65  12.98  12.33  14.76  12.33  
Cash dividends declared—  —  —  —  —  —  —  
               
               
1Non-GAAP measure - see "Explanation of Certain Unaudited Non-GAAP Financial Measures" for more information and a reconciliation to GAAP.   
2Calculated on a fully taxable equivalent basis using amortized cost.   
3These ratios are stated on an annualized basis and are not necessarily indicative of future periods.   
4The Company defines tangible assets as total assets less intangible assets, and tangible common equity as total shareholders' equity less   
  intangible assets.   
5Defined as noninterest expense less amortization of intangibles and gains, losses, and expenses on foreclosed properties divided by net   
  operating revenue (net interest income on a fully taxable equivalent basis plus noninterest income excluding securities gains).   
    


CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited)       
SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES         
   
 Quarterly Trends Twelve  Months Ended 
               
(Amounts in thousands, except per share data)4Q'19 3Q'19 2Q'19 1Q'19 4Q'18 4Q'19 4Q'18 
               
Interest on securities:              
Taxable$8,500  $8,802  $8,933  $9,119  $9,528  $35,354  $37,860  
Nontaxable130  131  143  151  200  555  884  
Interest and fees on loans62,868  63,092  62,288  62,287  59,495  250,535  199,984  
Interest on federal funds sold and other investments788  800  873  918  835  3,379  2,670  
Total Interest Income72,286  72,825  72,237  72,475  70,058  289,823  241,398  
               
Interest on deposits3,589  4,334  4,825  3,873  3,140  16,621  8,763  
Interest on time certificates5,084  6,009  5,724  4,959  3,901  21,776  11,684  
Interest on borrowed money1,853  1,534  1,552  2,869  3,033  7,808  9,436  
Total Interest Expense10,526  11,877  12,101  11,701  10,074  46,205  29,883  
               
Net Interest Income61,760  60,948  60,136  60,774  59,984  243,618  211,515  
Provision for loan losses4,800  2,251  2,551  1,397  2,342  10,999  11,730  
Net Interest Income After Provision for Loan Losses56,960  58,697  57,585  59,377  57,642  232,619  199,785  
               
Noninterest income:              
Service charges on deposit accounts2,960  2,978  2,894  2,697  3,019  11,529  11,198  
Trust fees1,096  1,183  1,147  1,017  1,040  4,443  4,183  
Mortgage banking fees1,514  2,127  1,734  1,115  809  6,490  4,682  
Brokerage commissions and fees483  449  541  436  468  1,909  1,732  
Marine finance fees338  153  201  362  185  1,054  1,398  
Interchange income3,387  3,206  3,405  3,401  3,198  13,399  12,335  
BOLI income904  928  927  915  1,091  3,674  4,291  
SBA gains576  569  691  636  519  2,472  2,474  
Other2,579  3,197  2,503  2,266  2,810  10,545  8,352  
 13,837  14,790  14,043  12,845  13,139  55,515  50,645  
Securities gains/(losses), net2,539  (847) (466) (9) (425) 1,217  (623) 
Total Noninterest Income16,376  13,943  13,577  12,836  12,714  56,732  50,022  
               
               
Noninterest expenses:              
Salaries and wages17,263  18,640  19,420  18,506  22,172  73,829  71,111  
Employee benefits3,323  2,973  3,195  4,206  3,625  13,697  12,945  
Outsourced data processing costs3,645  3,711  3,876  3,845  5,809  15,077  16,374  
Telephone / data lines651  603  893  811  602  2,958  2,481  
Occupancy3,368  3,368  3,741  3,807  3,747  14,284  13,394  
Furniture and equipment1,416  1,528  1,544  1,757  2,452  6,245  6,744  
Marketing885  933  1,211  1,132  1,350  4,161  5,085  
Legal and professional fees2,025  1,648  2,033  2,847  3,668  8,553  9,961  
FDIC assessments0  56  337  488  571  881  2,195  
Amortization of intangibles1,456  1,456  1,456  1,458  1,303  5,826  4,300  
Foreclosed property expense and net (gain)/loss on sale3  262  (174) (40) 0  51  461  
Other4,022  3,405  3,468  4,282  4,165  15,177  17,222  
Total Noninterest Expense38,057  38,583  41,000  43,099  49,464  160,739  162,273  
               
Income Before Income Taxes35,279  34,057  30,162  29,114  20,892  128,612  87,534  
Income taxes8,103  8,452  6,909  6,409  4,930  29,873  20,259  
               
Net Income$27,176  $25,605  $23,253  $22,705  $15,962  $98,739  $67,275  
               
Per share of common stock:              
               
Net income diluted$0.52  $0.49  $0.45  $0.44  $0.31  $1.90  $1.38  
Net income basic0.53  0.50  0.45  0.44  0.32  1.92  1.40  
Cash dividends declared—  —  —  —  —  —  —  
               
Average diluted shares outstanding52,081  51,935  51,952  52,039  51,237  52,029  48,748  
Average basic shares outstanding51,517  51,473  51,446  51,359  50,523  51,449  47,969  
               


CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)   
SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES      
    
  December 31, September 30, June 30, March 31, December 31, 
(Amounts in thousands) 2019 2019 2019 2019 2018 
            
Assets           
Cash and due from banks $89,843  $106,349  $97,792  $98,270  $92,242  
Interest bearing deposits with other banks 34,688  25,911  61,987  105,741  23,709  
Total Cash and Cash Equivalents 124,531  132,260  159,779  204,011  115,951  
            
Time deposits with other banks 3,742  4,579  4,980  8,174  8,243  
            
Debt Securities:           
Available for sale (at fair value) 946,855  920,811  914,615  877,549  865,831  
Held to maturity (at amortized cost) 261,369  273,644  287,302  295,485  357,949  
Total Debt Securities 1,208,224  1,194,455  1,201,917  1,173,034  1,223,780  
            
Loans held for sale 20,029  26,768  17,513  13,900  11,873  
            
Loans 5,198,404  4,986,289  4,888,139  4,828,441  4,825,214  
Less: Allowance for loan losses (35,154) (33,605) (33,505) (32,822) (32,423) 
Net Loans 5,163,250  4,952,684  4,854,634  4,795,619  4,792,791  
            
Bank premises and equipment, net 66,615  67,873  68,738  70,412  71,024  
Other real estate owned 12,390  13,593  11,043  11,921  12,802  
Goodwill 205,286  205,286  205,260  205,260  204,753  
Other intangible assets, net 20,066  21,318  22,672  23,959  25,977  
Bank owned life insurance 126,181  125,277  125,233  124,306  123,394  
Net deferred tax assets 16,457  17,168  19,353  24,647  28,954  
Other assets 141,740  129,384  133,764  128,146  128,117  
Total Assets $7,108,511  $6,890,645  $6,824,886  $6,783,389  $6,747,659  
            
Liabilities and Shareholders' Equity           
Liabilities           
Deposits           
Noninterest demand $1,590,493  $1,652,927  $1,669,804  $1,676,009  $1,569,602  
Interest-bearing demand 1,181,732  1,115,455  1,124,519  1,100,477  1,014,032  
Savings 519,152  528,214  519,732  508,320  493,807  
Money market 1,108,363  1,158,862  1,172,971  1,192,070  1,173,950  
Other time certificates 504,837  537,183  553,107  539,202  513,312  
Brokered time certificates 472,857  458,418  268,998  367,841  220,594  
Time certificates of more than $250,000 207,319  222,082  232,078  221,659  191,943  
Total Deposits 5,584,753  5,673,141  5,541,209  5,605,578  5,177,240  
            
Securities sold under agreements to repurchase 86,121  70,414  82,015  148,005  214,323  
Federal Home Loan Bank borrowings 315,000  50,000  140,000  3,000  380,000  
Subordinated debt 71,085  71,014  70,944  70,874  70,804  
Other liabilities 65,913  63,398  60,479  59,508  41,025  
Total Liabilities 6,122,872  5,927,967  5,894,647  5,886,965  5,883,392  
            
Shareholders' Equity           
Common stock 5,151  5,148  5,146  5,141  5,136  
Additional paid in capital 786,242  784,661  782,928  780,680  778,501  
Retained earnings 195,813  168,637  143,032  119,779  97,074  
Treasury stock (6,032) (6,079) (6,137) (4,959) (3,384) 
  981,174  952,367  924,969  900,641  877,327  
Accumulated other comprehensive income/(loss), net 4,465  10,311  5,270  (4,217) (13,060) 
Total Shareholders' Equity 985,639  962,678  930,239  896,424  864,267  
Total Liabilities & Shareholders' Equity $7,108,511  $6,890,645  $6,824,886  $6,783,389  $6,747,659  
            
Common shares outstanding 51,514  51,482  51,461  51,414  51,361  
            


CONSOLIDATED QUARTERLY FINANCIAL DATA(Unaudited)
SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES        
  
  
          
(Amounts in thousands)4Q'19 3Q'19 2Q'19 1Q'19 4Q'18
          
Credit Analysis         
Net charge-offs (recoveries) - non-acquired loans$2,930  $2,106  $1,621  $762  $3,693 
Net charge-offs (recoveries) - acquired loans295  5  220  201  56 
Total Net Charge-offs (Recoveries)3,225  2,111  1,841  963  3,749 
          
TDR valuation adjustments$27  $40  $27  $35  $35 
          
Net charge-offs (recoveries) to average loans - non-acquired loans0.23% 0.17% 0.13% 0.06% 0.32%
Net charge-offs (recoveries) to average loans - acquired loans0.02  —  0.02  0.02  — 
Total Net Charge-offs (Recoveries) to Average Loans0.25  0.17  0.15  0.08  0.32 
          
Provision for loan losses - non-acquired loans$4,041  $2,241  $2,326  $1,709  $2,343 
Provision for (recapture of) loan losses - acquired loans759  10  225  (312) (1)
Total Provision for Loan Losses$4,800  $2,251  $2,551  $1,397  $2,342 
          
Allowance for loan losses - non-acquired loans$34,573  $33,488  $33,393  $32,715  $31,803 
Allowance for loan losses - acquired loans581  117  112  107  620 
Total Allowance for Loan Losses$35,154  $33,605  $33,505  $32,822  $32,423 
          
Non-acquired loans at end of period$4,317,919  $4,010,299  $3,817,358  $3,667,221  $3,588,251 
Purchased noncredit impaired loans at end of period867,819  962,609  1,057,200  1,147,432  1,222,529 
Purchased credit impaired loans at end of period12,666  13,381  13,581  13,788  14,434 
Total Loans$5,198,404  $4,986,289  $4,888,139  $4,828,441  $4,825,214 
          
Non-acquired loans allowance for loan losses to non-acquired loans at end of period0.80% 0.84% 0.87% 0.89% 0.89%
Total allowance for loan losses to total loans at end of period0.68  0.67  0.69  0.68  0.67 
Purchase discount on acquired loans at end of period3.83  3.76  3.76  3.80  3.86 
          
End of Period         
Nonperforming loans - non-acquired$20,990  $20,400  $15,810  $15,423  $15,783 
Nonperforming loans - acquired5,965  5,644  6,986  6,990  10,693 
Other real estate owned - non-acquired5,177  5,177  66  831  386 
Other real estate owned - acquired372  1,574  1,612  1,725  3,020 
Bank branches closed included in other real estate owned6,842  6,842  9,365  9,365  9,396 
Total Nonperforming Assets$39,346  $39,637  $33,839  $34,334  $39,278 
          
Restructured loans (accruing)$11,100  $12,395  $14,534  $14,857  $13,346 
          
Nonperforming loans to loans at end of period - non-acquired0.49% 0.51% 0.41% 0.42% 0.44%
Nonperforming loans to loans at end of period - acquired0.68  0.58  0.65  0.60  0.86 
Total Nonperforming Loans to Loans at End of Period0.52  0.52  0.47  0.46  0.55 
          
Nonperforming assets to total assets - non-acquired0.46% 0.47% 0.37% 0.38% 0.38%
Nonperforming assets to total assets - acquired0.09  0.11  0.13  0.13  0.20 
Total Nonperforming Assets to Total Assets0.55  0.58  0.50  0.51  0.58 
          
 December 31, September 30, June 30, March 31, December 31,
Loans2019 2019 2019 2019 2018
          
Construction and land development$325,113  $326,324  $379,991  $417,565  $443,568 
Commercial real estate - owner occupied1,034,963  1,025,040  1,005,876  989,234  970,181 
Commercial real estate - non-owner occupied1,344,008  1,285,327  1,184,409  1,173,183  1,161,885 
Residential real estate1,507,863  1,409,946  1,400,184  1,329,166  1,324,377 
Consumer208,205  217,366  215,932  206,414  202,881 
Commercial and financial778,252  722,286  701,747  712,879  722,322 
Total Loans$5,198,404  $4,986,289  $4,888,139  $4,828,441  $4,825,214 
          


AVERAGE BALANCES, INTEREST INCOME AND EXPENSES, YIELDS AND RATES 1(Unaudited)       
SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES             
                   
                   
 4Q'19 3Q'19 4Q'18 
 Average   Yield/ Average   Yield/ Average   Yield/ 
(Amounts in thousands)Balance Interest Rate Balance Interest Rate Balance Interest Rate 
                   
Assets                  
Earning assets:                  
Securities:                  
Taxable$1,179,843  $8,500  2.88% $1,171,393  $8,802  3.01% $1,227,648  $9,528  3.10% 
Nontaxable20,709  162  3.13  21,194  164  3.09  29,255  252  3.45  
Total Securities1,200,552  8,662  2.89  1,192,587  8,966  3.01  1,256,903  9,780  3.11  
                   
Federal funds sold and other                  
investments84,961  788  3.68  84,705  800  3.75  87,146  835  3.80  
                   
Loans, net5,104,272  62,922  4.89  4,945,953  63,138  5.06  4,611,691  59,559  5.12  
                   
Total Earning Assets6,389,785  72,372  4.49  6,223,245  72,904  4.65  5,955,740  70,174  4.67  
                   
Allowance for loan losses(34,072)     (33,997)     (33,864)     
Cash and due from banks99,008      88,539      124,299      
Premises and equipment67,485      68,301      75,120      
Intangible assets226,060      227,389      213,713      
Bank owned life insurance125,597      125,249      132,495      
Other assets122,351      121,850      122,367      
                   
Total Assets$6,996,214      $6,820,576      $6,589,870      
                   
Liabilities and Shareholders' Equity                  
Interest-bearing liabilities:                  
Interest-bearing demand$1,190,681  $983  0.33% $1,116,434  $1,053  0.37% $974,711  $515  0.21% 
Savings528,771  422  0.32  522,831  531  0.40  509,434  418  0.33  
Money market1,148,453  2,184  0.75  1,173,042  2,750  0.93  1,161,599  2,207  0.75  
Time deposits1,078,297  5,084  1.87  1,159,272  6,009  2.06  899,153  3,901  1.72  
Securities sold under agreements to repurchase73,693  226  1.22  75,785  300  1.57  242,963  732  1.20  
Federal funds purchased and
Federal Home Loan Bank borrowings		181,134  845  1.85  68,804  414  2.39  240,799  1,468  2.42  
Other borrowings71,045  782  4.37  70,969  820  4.58  70,764  833  4.67  
                   
Total Interest-Bearing Liabilities4,272,074  10,526  0.98  4,187,137  11,877  1.13  4,099,423  10,074  0.97  
                   
Noninterest demand1,680,734      1,626,269      1,628,842      
Other liabilities67,206      60,500      33,846      
Total Liabilities6,020,014      5,873,906      5,762,111      
                   
Shareholders' equity976,200      946,670      827,759      
                   
Total Liabilities & Equity$6,996,214      $6,820,576      $6,589,870      
                   
Cost of deposits    0.61%     0.73%     0.54% 
Interest expense as a % of earning assets    0.65%     0.76%     0.67% 
Net interest income as a % of earning assets  $61,846  3.84%   $61,027  3.89%   $60,100  4.00% 
                   
                   
1On a fully taxable equivalent basis. All yields and rates have been computed using amortized cost.     
Fees on loans have been included in interest on loans. Nonaccrual loans are included in loan balances.     


AVERAGE BALANCES, INTEREST INCOME AND EXPENSES, YIELDS AND RATES 1(Unaudited)
SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES         
   
 Twelve Months Ended December 31, 2019 Twelve Months Ended December 31, 2018 
 Average   Yield/ Average   Yield/ 
(Amounts in thousands, except ratios)Balance Interest Rate Balance Interest Rate 
             
Assets            
Earning assets:            
Securities:            
Taxable$1,176,842  $35,354  3.00% $1,299,089  $37,860  2.91% 
Nontaxable23,122  695  3.01  31,331  1,115  3.56  
Total Securities1,199,964  36,049  3.00  1,330,420  38,975  2.93  
             
Federal funds sold and other            
investments88,045  3,379  3.84  61,048  2,670  4.37  
             
Loans, net4,933,518  250,730  5.08  4,112,009  200,194  4.87  
             
Total Earning Assets6,221,527  290,158  4.66  5,503,477  241,839  4.39  
             
Allowance for loan losses(33,465)     (29,972)     
Cash and due from banks94,643      114,936      
Premises and equipment69,142      67,332      
Intangible assets228,042      178,287      
Bank owned life insurance124,803      124,452      
Other assets126,588      98,823      
             
Total Assets$6,831,280      $6,057,335      
             
Liabilities and Shareholders' Equity            
Interest-bearing liabilities:            
Interest-bearing demand$1,114,334  $4,025  0.36% $978,030  $1,883  0.19% 
Savings516,526  2,015  0.39  457,542  811  0.18  
Money market1,164,938  10,581  0.91  1,049,900  6,069  0.58  
Time deposits1,092,516  21,776  1.99  811,741  11,684  1.44  
Securities sold under agreements to repurchase106,142  1,431  1.35  200,839  1,804  0.90  
Federal funds purchased and
Federal Home Loan Bank borrowings		131,921  3,010  2.28  224,982  4,468  1.99  
Other borrowings70,939  3,367  4.75  70,658  3,164  4.48  
             
Total Interest-Bearing Liabilities4,197,316  46,205  1.10  3,793,692  29,883  0.79  
             
Noninterest demand1,641,766      1,492,451      
Other liabilities63,405      30,621      
Total Liabilities5,902,487      5,316,764      
             
Shareholders' equity928,793      740,571      
             
Total Liabilities & Equity$6,831,280      $6,057,335      
             
Cost of deposits    0.69%     0.43% 
Interest expense as a % of earning assets    0.74%     0.54% 
Net interest income as a % of earning assets  $243,953  3.92%   $211,956  3.85% 
             
             
1On a fully taxable equivalent basis. All yields and rates have been computed using amortized cost.
Fees on loans have been included in interest on loans. Nonaccrual loans are included in loan balances.


CONSOLIDATED QUARTERLY FINANCIAL DATA  (Unaudited)    
SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES       
     
   December 31, September 30, June 30, March 31, December 31, 
(Amounts in thousands) 2019 2019 2019 2019 2018 
             
Customer Relationship Funding           
Noninterest demand           
Commercial  $1,233,475  $1,314,102  $1,323,743  $1,298,468  $1,217,842  
Retail  246,717  241,734  251,879  275,383  259,318  
Public funds  85,122  65,869  65,822  73,640  68,324  
Other  25,179  31,222  28,360  28,518  24,118  
Total Noninterest Demand 1,590,493  1,652,927  1,669,804  1,676,009  1,569,602  
             
Interest-bearing demand           
Commercial  319,993  342,376  323,818  289,544  211,879  
Retail  641,762  622,833  634,099  646,522  650,490  
Public funds  219,977  150,246  166,602  164,411  151,663  
Total Interest-Bearing Demand 1,181,732  1,115,455  1,124,519  1,100,477  1,014,032  
             
Total transaction accounts           
Commercial  1,553,468  1,656,478  1,647,561  1,588,012  1,429,721  
Retail  888,479  864,567  885,978  921,905  909,808  
Public funds  305,099  216,115  232,424  238,051  219,987  
Other  25,179  31,222  28,360  28,518  24,118  
Total Transaction Accounts 2,772,225  2,768,382  2,794,323  2,776,486  2,583,634  
             
Savings  519,152  528,214  519,732  508,320  493,807  
             
Money market           
Commercial  494,803  513,477  517,041  500,649  459,380  
Retail  553,075  583,917  590,320  602,378  607,837  
Public funds  60,485  61,468  65,610  89,043  106,733  
Total Money Market 1,108,363  1,158,862  1,172,971  1,192,070  1,173,950  
             
Brokered time certificates 472,857  458,418  268,998  367,841  220,594  
Other time certificates 712,156  759,265  785,185  760,861  705,255  
  1,185,013  1,217,683  1,054,183  1,128,702  925,849  
Total Deposits $5,584,753  $5,673,141  $5,541,209  $5,605,578  $5,177,240  
             
Customer sweep accounts $86,121  $70,414  $82,015  $148,005  $214,323  
             


Explanation of Certain Unaudited Non-GAAP Financial Measures

This presentation contains financial information determined by methods other than Generally Accepted Accounting Principles (“GAAP”). Management uses these non-GAAP financial measures in its analysis of the Company’s performance and believes these presentations provide useful supplemental information, and a clearer understanding of the Company’s performance. The Company believes the non-GAAP measures enhance investors’ understanding of the Company’s business and performance and if not provided would be requested by the investor community. These measures are also useful in understanding performance trends and facilitate comparisons with the performance of other financial institutions. The limitations associated with operating measures are the risk that persons might disagree as to the appropriateness of items comprising these measures and that different companies might define or calculate these measures differently. The Company provides reconciliations between GAAP and these non-GAAP measures. These disclosures should not be considered an alternative to GAAP.


GAAP TO NON-GAAP RECONCILIATION (Unaudited)       
SEACOAST  BANKING  CORPORATION  OF  FLORIDA  AND  SUBSIDIARIES           
               
 Quarterly Trends Twelve  Months Ended 
               
(Amounts in thousands, except per share data)4Q'19 3Q'19 2Q'19 1Q'19 4Q'18 4Q'19 4Q'18 
               
Net Income$27,176  $25,605  $23,253  $22,705  $15,962  $98,739  $67,275  
               
Total noninterest income16,376  13,943  13,577  12,836  12,714  56,732  50,022  
Securities (gains)/losses, net(2,539) 847  466  9  425  (1,217) 623  
BOLI benefits on death (included in other income)—  (956) —  —  (280) (956) (280) 
Total Adjustments to Noninterest Income(2,539) (109) 466  9  145  (2,173) 343  
Total Adjusted Noninterest Income13,837  13,834  14,043  12,845  12,859  54,559  50,365  
               
Total noninterest expense38,057  38,583  41,000  43,099  49,464  160,739  162,273  
Merger related charges(634) —  —  (335) (8,034) (969) (9,681) 
Amortization of intangibles(1,456) (1,456) (1,456) (1,458) (1,303) (5,826) (4,300) 
Business continuity expenses - hurricane events—  (95) —  —  —  (95) —  
Branch reductions and other expense initiatives—  (121) (1,517) (208) (587) (1,846) (587) 
Total Adjustments to Noninterest Expense(2,090) (1,672) (2,973) (2,001) (9,924) (8,736) (14,568) 
Total Adjusted Noninterest Expense35,967  36,911  38,027  41,098  39,540  152,003  147,705  
               
Income Taxes8,103  8,452  6,909  6,409  4,930  29,873  20,259  
Tax effect of adjustments(110) 572  874  510  2,623  1,846  3,834  
Taxes and tax penalties on acquisition-related BOLI redemption—  —  —  —  (485) —  (485) 
Effect of change in corporate tax rate on deferred tax assets—  (1,135) —  —  —  (1,135) (248) 
Total Adjustments to Income Taxes(110) (563) 874  510  2,138  711  3,101  
Adjusted Income Taxes7,993  7,889  7,783  6,919  7,068  30,584  23,360  
Adjusted Net Income$26,837  $27,731  $25,818  $24,205  $23,893  $104,591  $79,085  
               
Earnings per diluted share, as reported$0.52  $0.49  $0.45  $0.44  $0.31  $1.90  $1.38  
Adjusted Earnings per Diluted Share0.52  0.53  0.50  0.47  0.47  2.01  1.62  
Average diluted shares outstanding52,081  51,935  51,952  52,039  51,237  52,029  48,748  
               
Adjusted Noninterest Expense$35,967  $36,911  $38,027  $41,098  $39,540  $152,003  $147,705  
Foreclosed property expense and net gain/(loss) on sale(3) (262) 174  40  —  (51) (460) 
Net Adjusted Noninterest Expense$35,964  $36,649  $38,201  $41,138  $39,540  $151,952  $147,245  
               
Revenue$78,136  $74,891  $73,713  $73,610  $72,698  $300,350  $261,537  
Total Adjustments to Revenue(2,539) (109) 466  9  145  (2,173) 343  
Impact of FTE adjustment87  79  83  87  116  336  441  
Adjusted Revenue on a fully taxable equivalent basis$75,684  $74,861  $74,262  $73,706  $72,959  $298,513  $262,321  
Adjusted Efficiency Ratio47.52% 48.96% 51.44% 55.81% 54.19% 50.90% 56.13% 
               
Average Assets$6,996,214  $6,820,576  $6,734,994  $6,770,978  $6,589,870  $6,831,280  $6,057,335  
Less average goodwill and intangible assets(226,060) (227,389) (228,706) (230,066) (213,713) (228,042) (178,287) 
Average Tangible Assets$6,770,154  $6,593,187  $6,506,288  $6,540,912  $6,376,157  $6,603,238  $5,879,048  
               
Return on Average Assets (ROA)1.54% 1.49% 1.38% 1.36% 0.96% 1.45% 1.11% 
Impact of removing average intangible assets and related amortization0.12  0.12  0.12  0.12  0.09  0.11  0.09  
Return on Average Tangible Assets (ROTA)1.66  1.61  1.50  1.48  1.05  1.56  1.20  
Impact of other adjustments for Adjusted Net Income(0.09) 0.06  0.09  0.02  0.44  0.02  0.15  
Adjusted Return on Average Tangible Assets1.57  1.67  1.59  1.50  1.49  1.58  1.35  
               
Average Shareholders' Equity$976,200  $946,670  $911,479  $879,564  $827,759  $928,793  $740,571  
Less average goodwill and intangible assets(226,060) (227,389) (228,706) (230,066) (213,713) (228,042) (178,287) 
Average Tangible Equity$750,140  $719,281  $682,773  $649,498  $614,046  $700,751  $562,284  
               
Return on Average Shareholders' Equity11.04% 10.73% 10.23% 10.47% 7.65% 10.63% 9.08% 
Impact of removing average intangible assets and related amortization3.91  4.00  4.07  4.39  3.29  4.09  3.46  
Return on Average Tangible Common Equity (ROTCE)14.95  14.73  14.30  14.86  10.94  14.72  12.54  
Impact of other adjustments for Adjusted Net Income(0.76) 0.57  0.87  0.25  4.50  0.21  1.52  
Adjusted Return on Average Tangible Common Equity14.19  15.30  15.17  15.11  15.44  14.93  14.06  
               
Loan interest income excluding accretion on acquired loans$59,515  $59,279  $58,169  $58,397  $55,470  $235,359  $188,865  
Accretion on acquired loans3,407  3,859  4,166  3,938  4,089  15,371  11,329  
Loan interest income1$62,922  $63,138  $62,335  $62,335  $59,559  $250,730  $200,194  
1On a fully taxable equivalent basis. All yields and rates have been computed using amortized cost. 
  
  
GAAP TO NON-GAAP RECONCILIATION (Unaudited)       
SEACOAST  BANKING  CORPORATION  OF  FLORIDA  AND  SUBSIDIARIES           
               
 Quarterly Trends Twelve  Months Ended 
               
(Amounts in thousands, except per share data)4Q'19 3Q'19 2Q'19 1Q'19 4Q'18 4Q'19 4Q'18 
               
Yield on loans excluding accretion on acquired loans4.63% 4.76% 4.82% 4.89% 4.77% 4.77% 4.59% 
Impact of accretion on acquired loans0.26  0.30  0.34  0.33  0.35  0.31  0.28  
Yield on loans4.89  5.06  5.16  5.22  5.12  5.08  4.87  
               
Net interest income excluding accretion on acquired loans$58,439  $57,168  $56,053  $56,923  $56,011  $228,582  $200,627  
Accretion on acquired loans3,407  3,859  4,166  3,938  4,089  15,371  11,329  
Net Interest Income1$61,846  $61,027  $60,219  $60,861  $60,100  $243,953  $211,956  
               
Net interest margin excluding accretion on acquired loans3.63% 3.64% 3.67% 3.76% 3.73% 3.67% 3.65% 
Impact of accretion on acquired loans0.21  0.25  0.27  0.26  0.27  0.25  0.20  
Net Interest Margin3.84  3.89  3.94  4.02  4.00  3.92  3.85  
               
Security interest income excluding tax equivalent adjustment$8,630  $8,933  $9,076  $9,270  $9,728  $35,909  $38,743  
Tax equivalent adjustment on securities32  33  36  39  52  140  232  
Security interest income1$8,662  $8,966  $9,112  $9,309  $9,780  $36,049  $38,975  
               
Loan interest income excluding tax equivalent adjustment$62,867  $63,091  $62,287  $62,287  $59,495  $250,532  $199,984  
Tax equivalent adjustment on loans55  47  48  48  64  198  210  
Loan interest income1$62,922  $63,138  $62,335  $62,335  $59,559  $250,730  $200,194  
               
Net interest income excluding tax equivalent adjustment$61,759  $60,947  $60,135  $60,774  $59,984  $243,615  $211,514  
Tax equivalent adjustment on securities32  33  36  39  52  140  232  
Tax equivalent adjustment on loans55  47  48  48  64  198  210  
Net Interest Income1$61,846  $61,027  $60,219  $60,861  $60,100  $243,953  $211,956  
               
1On a fully taxable equivalent basis. All yields and rates have been computed using amortized cost. 

Charles M. Shaffer
Executive Vice President
Chief Operating Officer and
Chief Financial Officer
(772) 221-7003
Chuck.Shaffer@seacoastbank.com