SEACOAST REPORTS SECOND QUARTER 2023 RESULTS


Well-Positioned Balance Sheet with Strong Capital and Liquidity

Distinctive Deposit Franchise with Granular, Longstanding Customer Base

STUART, Fla., July 27, 2023 (GLOBE NEWSWIRE) -- Seacoast Banking Corporation of Florida (“Seacoast” or the “Company”) (NASDAQ: SBCF) today reported net income in the second quarter of 2023 of $31.2 million, or $0.37 per diluted share, compared to $11.8 million, or $0.15 per diluted share in the first quarter of 2023 and $32.8 million, or $0.53 per diluted share in the second quarter of 2022. For the six months ended June 30, 2023, net income was $43.1 million, or $0.52 per diluted share, a decrease of 19% compared to the six months ended June 30, 2022.

Adjusted net income1 for the second quarter of 2023 was $49.2 million, or $0.58 per diluted share, compared to $29.2 million, or $0.36 per diluted share in the first quarter of 2023 and $36.3 million, or $0.59 per diluted share in the second quarter of 2022. Adjusted net income1 for the six months ended June 30, 2023 was $78.4 million, or $0.94 per diluted share, an increase of 24% compared to the six months ended June 30, 2022.

For the second quarter of 2023, return on average tangible assets was 1.06% and return on average tangible shareholders’ equity was 12.08%, compared to 0.52% and 5.96%, respectively, in the prior quarter, and 1.29% and 13.01%, respectively, in the prior year quarter. Adjusted return on average tangible assets1 in the second quarter of 2023 was 1.41% and adjusted return on average tangible shareholders’ equity1 was 16.08%, compared to 0.90% and 10.34%, respectively, in the prior quarter, and 1.38% and 13.97%, respectively, in the prior year quarter. For the six months ended June 30, 2023, return on average tangible assets was 0.80% and return on average tangible shareholders’ equity was 9.14%, compared to 1.07% and 10.46%, respectively, for the six months ended June 30, 2022. For the six months ended June 30, 2023, adjusted return on average tangible assets1 was 1.16% and adjusted return on average tangible shareholders’ equity1 was 13.32%, compared to 1.23% and 11.95%, respectively, for the six months ended June 30, 2022.

Charles M. Shaffer, Seacoast’s Chairman and CEO said, “Seacoast delivered another quarter of robust financial performance, with strong adjusted earnings leading to an adjusted return on tangible common equity of 16.1%. Our capital and liquidity ratios were strong and our asset quality remains excellent. During the quarter, we successfully completed the Professional Bank conversion, wrapping up a significant period of M&A activity that has boosted Seacoast beyond the $10 billion asset threshold and definitively positioned the Company as Florida’s Bank.”

Shaffer added, “Seacoast is committed to our fortress balance sheet, with an allowance for loan losses of $159.7 million and an additional $201.8 million discount on acquired loans, providing significant loss absorption capacity. Our second quarter ratio of tangible common equity to tangible assets increased to 8.53% as we moved past the initially dilutive effect of recent acquisitions, reflecting commitment to driving shareholder value creation.”

Shaffer concluded, “Our strategic focus for the balance of the year will be on relationship-driven customer acquisition and carefully managing our expense base while investing in tactics to drive low-cost deposit growth. We believe that this rigorous approach will support solid capital growth, produce a broadly diversified and stable funding base, and generate increased franchise value over the long run.”

Acquisition Update

In June 2023, we successfully completed the integration of Professional Holding Corp. (“Professional”), including the consolidation of five branches in the South Florida market. Merger-related expense synergies are expected to be fully realized in the second half of 2023. Direct merger-related costs recorded during the second quarter of 2023 totaled $15.6 million. We expect merger-related costs to be insignificant in the third quarter of 2023.

Financial Results

Income Statement

  • Net income was $31.2 million, or $0.37 per diluted share, for the second quarter of 2023 compared to net income of $11.8 million, or $0.15 per diluted share, for the prior quarter, and $32.8 million, or $0.53 per diluted share, for the prior year quarter. For the six months ended June 30, 2023, net income was $43.1 million, or $0.52 per diluted share, compared to $53.3 million, or $0.86 per diluted share, for the six months ended June 30, 2022. The results for the six months ended June 30, 2023 included the $26.6 million day-1 provision for credit losses on loans acquired in the Professional acquisition. Adjusted net income1 for the second quarter of 2023 was $49.2 million, or $0.58 per diluted share, compared to $29.2 million, or $0.36 per diluted share, for the prior quarter, and $36.3 million, or $0.59 per diluted share, for the prior year quarter. For the six months ended June 30, 2023, adjusted net income1 was $78.4 million, or $0.94 per diluted share, compared to $63.4 million, or $1.03 per diluted share, for the six months ended June 30, 2022.
  • Net revenues were $148.5 million in the second quarter of 2023, a decrease of $5.1 million, or 3%, compared to the prior quarter, and an increase of $49.9 million, or 51%, compared to the prior year quarter. For the six months ended June 30, 2023, net revenues were $302.1 million, an increase of $111.6 million, or 59%, compared to the six months ended June 30, 2022. Adjusted revenues1 were $148.7 million in the second quarter of 2023, a decrease of $2.7 million, or 2%, compared to the prior quarter, and an increase of $49.8 million, or 50%, compared to the prior year quarter. For the six months ended June 30, 2023, adjusted revenues1 were $300.1 million, an increase of $108.8 million, or 57%, compared to the six months ended June 30, 2022.
  • Pre-tax pre-provision earnings1 were $40.9 million in the second quarter of 2023, a decrease of 12% compared to the first quarter of 2023 and a decrease of 4% compared to the second quarter of 2022. Adjusted pre-tax pre-provision earnings1 were $64.9 million in the second quarter of 2023, a decrease of 9% compared to the first quarter of 2023 and an increase of 40% compared to the second quarter of 2022. Adjusted pre-tax pre-provision earnings1 for the six months ended June 30, 2023 were $135.9 million, an increase of $47.8 million, or 54%, when compared to the six months ended June 30, 2022.
  • Net interest income totaled $127.0 million in the second quarter of 2023, a decrease of $4.2 million, or 3%, from the first quarter of 2023 and an increase of $45.3 million, or 56%, compared to the second quarter of 2022. When excluding accretion on acquired loans, net interest income declined $2.4 million. Accretion on acquired loans totaled $14.2 million in the second quarter of 2023, $15.9 million in the first quarter of 2023, and $2.7 million in the second quarter of 2022. For the six months ended June 30, 2023, net interest income was $258.1 million, an increase of $99.9 million, or 63%, compared to the six months ended June 30, 2022. Accretion on acquired loans totaled $30.1 million for the six months ended June 30, 2023, compared to $6.4 million for the six months ended June 30, 2022.
  • Net interest margin decreased 45 basis points to 3.86% in the second quarter of 2023 compared to 4.31% in the first quarter of 2023. The decline in the net interest margin from the prior quarter was driven by the impact of rising rates on the competitive environment for deposits, the continued effect of an inverted yield curve, and lower accretion of purchase discounts on acquired loans. Loan yields increased three basis points to 5.89%. The effect on loan yields of accretion of purchase discounts on acquired loans in the second quarter of 2023 was an increase of 56 basis points, compared to an increase of 69 basis points in the first quarter of 2023. Securities yields increased 28 basis points to 3.13%, including approximately 12 basis points of benefit from interest rate swaps initiated in the second quarter. The cost of deposits increased 61 basis points, from 77 basis points in the prior quarter, to 1.38% for the second quarter of 2023.
  • Noninterest income totaled $21.6 million in the second quarter of 2023, a decrease of $0.9 million, or 4%, compared to the prior quarter, and an increase of $4.6 million, or 27%, compared to the prior year quarter. For the six months ended June 30, 2023, noninterest income was $44.0 million, an increase of $11.7 million, or 36%, compared to the six months ended June 30, 2022. Results for the second quarter of 2023 included the following:
    • Service charges on deposits increased $0.3 million, or 7%, compared to the prior quarter and $1.2 million, or 34%, year over year, including the continued benefit of the expansion of treasury management services to commercial customers.
    • Interchange income totaled $5.1 million in the second quarter, an increase of $0.4 million, or 8%, when compared to the prior quarter and $0.8 million, or 19%, compared to the prior year quarter. As a reminder, beginning in the third quarter of 2023, the Company’s interchange income will be reduced by the requirements of the Durbin amendment, which became effective for the Company on July 1, 2023.
    • The wealth management division continues to demonstrate notable success in building relationships, and during the second quarter of 2023, income increased $0.3 million, or 8%, compared to the prior quarter and $0.5 million, or 20%, compared to the prior year quarter. Assets under management increased by $60 million in the second quarter of 2023, bringing total assets under management to $1.6 billion, up 36% from the prior year.
    • Mortgage banking fees totaled $0.6 million in the second quarter, an increase of $0.2 million, or 35%, due to higher saleable production.
    • Other income decreased by $1.8 million compared to the prior quarter, primarily the result of the recognition in the prior quarter of $2.1 million in bank owned life insurance (“BOLI”) death benefits.
  • The provision for credit losses was a net benefit of $0.8 million in the second quarter of 2023, compared to a provision of $31.6 million in the first quarter of 2023 and a provision of $0.8 million in the second quarter of 2022. The provision for credit losses in the first quarter of 2023 included $26.6 million in day-1 provision recorded at the acquisition of Professional.
  • Noninterest expense was $107.9 million in the second quarter of 2023, an increase of $0.4 million compared to the prior quarter, and an increase of $51.7 million, or 92%, compared to the prior year quarter. The second quarter of 2023 included $15.6 million of merger-related expenses, compared to $17.5 million in the prior quarter and $3.0 million in the prior year quarter. Noninterest expense was $215.3 million for the six months ended June 30, 2023, including $33.2 million in merger-related charges, compared to $115.1 million in the six months ended June 30, 2022, which included $9.7 million in merger-related charges. Changes compared to the first quarter of 2023 included:
    • Salaries and wages decreased $2.5 million to $45.2 million in the second quarter of 2023. The second quarter of 2023 included $1.6 million in merger-related expenses, compared to $4.2 million in the first quarter of 2023.
    • In the third quarter of 2023, we are continuing our focus on efficiency and streamlining operations, and in late July we executed a reduction in the Company’s workforce by approximately 5%. The Company will incur severance charges in a range of approximately $2.0 to $3.0 million. The resulting lower compensation expense in the third quarter of 2023 will largely be offset by investments in marketing expenses to drive low-cost deposit growth, and lower expense deferral associated with slowing loan originations. As a reminder, under the relevant accounting guidance, the Company defers the expenses associated with the origination of new loans, and recognizes this expense as a reduction to loan yield over the life of the loan. We expect the full benefit of the reduction in workforce to materialize in the fourth quarter of 2023.
    • Employee benefits decreased $1.1 million to $7.5 million in the second quarter of 2023 as a result of higher seasonal payroll taxes impacting the first quarter of 2023.
    • Outsourced data processing costs increased $5.7 million to $20.2 million in the second quarter of 2023. The second quarter of 2023 included $10.9 million in merger-related expenses, compared to $6.6 million in the first quarter of 2023. Termination penalties related to the Professional technology contracts were recorded in the second quarter in conjunction with the system conversion.
    • Telephone and data lines increased $0.4 million to $1.5 million in the second quarter of 2023 reflecting the expansion of the branch footprint.
    • Legal and professional fees decreased by $3.4 million to $4.1 million in the second quarter of 2023, and included $1.7 million in merger-related expenses during the second quarter of 2023 compared to $4.8 million of merger-related expenses in the first quarter of 2023.
    • Amortization of intangibles increased by $0.9 million to $7.7 million resulting from the first full quarter of amortization of the core deposit intangible assets acquired from Professional. These assets are amortized using an accelerated amortization method.
    • Other noninterest expenses increased $1.1 million to $8.3 million in the second quarter of 2023, primarily attributed to maintaining parallel activities and processes prior to the conversion of Professional in June 2023.
  • Seacoast recorded $10.2 million of income tax expense in the second quarter of 2023, compared to $2.7 million in the first quarter of 2023, and $8.9 million in the second quarter of 2022, with an effective tax rate of 24.6%, 18.6%, and 21.3%, respectively. Impacts related to stock-based compensation were tax expense of $0.3 million in the second quarter of 2023, tax benefits of $0.2 million in the first quarter of 2023, and tax benefits of $0.4 million in the second quarter of 2022. The first quarter of 2023 included a discrete benefit of $0.6 million related to the BOLI distribution which, combined with lower overall pre-tax income, resulted in a lower effective tax rate in that period.
  • The efficiency ratio was 67.34% in the second quarter of 2023, compared to 65.43% in the first quarter of 2023 and 56.22% in the prior year quarter. The adjusted efficiency ratio1 was 56.44% in the second quarter of 2023, compared to 53.10% in the first quarter of 2023 and 53.15% in the prior year quarter. The Company continues to remain keenly focused on disciplined expense control. The increase in the adjusted efficiency ratio primarily reflects the impact of higher deposit rates on net interest income in the period. The adjusted efficiency ratio1 for the six months ended June 30, 2023 was 54.76% compared to 53.97% for the six months ended June 30, 2022.

Balance Sheet

  • At June 30, 2023, the Company had total assets of $15.0 billion and total shareholders’ equity of $2.1 billion. Book value per share was $24.14 on June 30, 2023, compared to $24.24 on March 31, 2023, and $21.65 on June 30, 2022. Tangible book value per share totaled $14.24 on June 30, 2023 compared to $14.25 on March 31, 2023 and $16.66 on June 30, 2022. Removing the impact of the change in accumulated comprehensive income, tangible book value per share increased by $0.20.
  • Debt securities totaled $2.6 billion on June 30, 2023, a decrease of $129.8 million, or 5%, compared to March 31, 2023. Debt securities include approximately $1.9 billion in securities held at fair value and classified as available for sale. The unrealized loss on these securities is fully reflected in the value presented on the balance sheet. The portfolio also includes $707.8 million in securities classified as held to maturity with a fair value of $577.6 million. Held-to-maturity securities consist solely of mortgage-backed securities and collateralized mortgage obligations guaranteed by U.S. government agencies, each of which is expected to recover any price depreciation over its holding period as the debt securities move to maturity. The Company has significant liquidity and available borrowing capacity and has the intent and ability to hold these investments to maturity.
  • Loans decreased $16.5 million when compared to the prior quarter, totaling $10.1 billion as of June 30, 2023. The Company continues to exercise a disciplined approach to lending, carefully underwriting loans to strict underwriting guidelines and setting high expectations for risk adjusted returns given the current environment.
  • Loan originations were $518.9 million in the second quarter of 2023, a decrease of 3% compared to $536.3 million in the first quarter of 2023.
    • Commercial originations were $317.4 million during the second quarter of 2023, compared to $321.7 million in the first quarter of 2023, and $461.9 million in the second quarter of 2022.
    • Consumer originations in the second quarter of 2023 were $97.2 million, compared to $110.6 million in the first quarter of 2023, and $130.8 million in the second quarter of 2022.
    • Residential loans originated for sale in the secondary market totaled $19.1 million in the second quarter of 2023, compared to $13.9 million in the first quarter of 2023, and $42.7 million in the second quarter of 2022.
    • Closed residential loans retained in the portfolio totaled $85.3 million in the second quarter of 2023, compared to $90.1 million in the first quarter of 2023, and $103.0 million in the second quarter of 2022.
  • Pipelines (loans in underwriting and approval or approved and not yet closed) totaled $284.6 million on June 30, 2023, a decrease of 27% from March 31, 2023, and a decrease of 54% from June 30, 2022.
    • Commercial pipelines were $217.6 million as of June 30, 2023, a decrease of 27% from $297.4 million at March 31, 2023, and a decrease of 54% from $476.7 million at June 30, 2022. The decline in pipeline quarter over quarter was the result of the impact of higher rates and a continued selective approach on new credit facilities given a cautious economic outlook.
    • Consumer pipelines were $28.4 million as of June 30, 2023, a decrease of $10.3 million from $38.7 million at March 31, 2023, and a decrease of 62% from $75.5 million at June 30, 2022.
    • Residential saleable pipelines were $11.5 million as of June 30, 2023, compared to $6.6 million at March 31, 2023, and $14.7 million at June 30, 2022. Retained residential pipelines were $27.1 million as of June 30, 2023, compared to $48.4 million at March 31, 2023, and $53.1 million at June 30, 2022.
  • Total deposits were $12.3 billion as of June 30, 2023, a decrease of $26.4 million when compared to March 31, 2023, and an increase of $3.1 billion, or 34%, compared to June 30, 2022. Seacoast’s granular, longstanding deposit base is a hallmark of our franchise, and in the current environment serves as a significant source of strength. The Company continues to maintain balance sheet flexibility and ended the quarter with a loan to deposit ratio of 82%.
    • At June 30, 2023, transaction account balances represented 57% of overall deposits.
    • Noninterest bearing demand deposits represent 34% of overall deposits.
    • Average deposits per banking center were $157 million at June 30, 2023 compared to $148 million at March 31, 2023.
    • Uninsured deposits represented only 34% of overall deposit accounts as of June 30, 2023. This includes public funds under the Florida Qualified Public Depository program, which provides loss protection to depositors beyond FDIC insurance limits. Excluding such balances, the uninsured and uncollateralized deposits were 28% of total deposits. The Company has liquidity sources including cash and lines of credit with the Federal Reserve and Federal Home Loan Bank that represent 155% of uninsured deposits, and 184% of uninsured and uncollateralized deposits.
    • Consumer deposits represent 43% of overall deposit funding with an average consumer customer balance of $23 thousand. Commercial deposits represent 57% of overall deposit funding with an average business customer balance of $109 thousand.
  • Federal Home Loan Bank advances totaled $160.0 million at June 30, 2023 with a weighted average interest rate of 3.64%. In the aggregate, borrowed funds, including FHLB advances, subordinated debt, and brokered deposits represented only 6.6% of total liabilities as of June 30, 2023.

Asset Quality

  • Credit metrics remain strong with charge-offs, non-accruals, and criticized assets at historically low levels. The Company remains diligent in its monitoring of these metrics, as well as changes in the broader economic environment.
  • Nonperforming loans were $48.3 million at June 30, 2023. Nonperforming loans to total loans outstanding were 0.48% at June 30, 2023, 0.50% at March 31, 2023, and 0.40% at June 30, 2022.
  • Nonperforming assets to total assets decreased to 0.37% at June 30, 2023, compared to 0.38% at March 31, 2023, and increased from 0.27% at June 30, 2022.
  • The ratio of allowance for credit losses to total loans was 1.58% at June 30, 2023, 1.54% at March 31, 2023, and 1.39% at June 30, 2022.
  • Net charge-offs of $0.7 million for the second quarter of 2023 compared to $3.2 million in the first quarter of 2023 and compared to a net recovery of $0.1 million in the second quarter of 2022. Net charge-offs for the four most recent quarters averaged 0.06%.
  • Portfolio diversification, in terms of asset mix, industry, and loan type, has been a critical element of the Company’s lending strategy. Exposure across industries and collateral types is broadly distributed. Seacoast’s average loan size is $278 thousand, and the average commercial loan size is $685 thousand, reflecting an ability to maintain granularity within the overall loan portfolio.
  • Construction and land development and commercial real estate loans remain well below regulatory guidance at 52% and 256% of total bank-level risk-based capital, respectively, compared to 48% and 258%, respectively, at March 31, 2023. On a consolidated basis, construction and land development and commercial real estate loans represent 47% and 236%, respectively, of total consolidated risk-based capital.

Capital and Liquidity

  • The Company continues to operate with a fortress balance sheet with a tier 1 capital ratio at June 30, 2023 of 13.9% compared to 13.4% at March 31, 2023, and 16.8% at June 30, 2022. The total capital ratio was 15.0%, the common equity tier 1 capital ratio was 12.9%, and the tier 1 leverage ratio was 10.8% at June 30, 2023. The Company is considered “well capitalized” based on applicable U.S. regulatory capital ratio requirements.
  • In April 2023, the Company announced an increase to its common share dividend by $0.01 to $0.18 per share.
  • Cash and cash equivalents at June 30, 2023 totaled $727.9 million.
  • Our Board of Directors has approved a share repurchase program of up to $100 million in shares of the Company’s common stock. During the second quarter of 2023, 2,515 shares were repurchased under the program at a weighted average price of $17.99 per share.
  • The Company’s loan to deposit ratio was 82% at June 30, 2023, providing liquidity and flexibility moving forward.
  • Tangible common equity to tangible assets was 8.53% at June 30, 2023, compared to 8.36% at March 31, 2023, and 9.74% at June 30, 2022. If all held-to-maturity securities were adjusted to fair value, the tangible common equity ratio would have been 7.87%.
  • At June 30, 2023, in addition to $727.9 million in cash, the Company had $5.7 billion in available borrowing capacity, including $4.7 billion in available collateralized lines of credit, $0.7 billion of unpledged debt securities available as collateral for potential additional borrowings, and available unsecured lines of credit of $0.3 billion. These liquidity sources as of June 30, 2023 represented 184% of uninsured and uncollateralized deposits.
FINANCIAL HIGHLIGHTS        
(Amounts in thousands except per share data)
    (Unaudited)        
 Quarterly Trends 
           
 2Q’23 1Q’23 4Q’22 3Q’22 2Q’22 
Selected balance sheet data:          
Gross loans$10,117,919  $10,134,395  $8,144,724  $6,690,845  $6,541,548  
Total deposits 12,283,267   12,309,701   9,981,595   8,765,414   9,188,953  
Total assets 15,041,932   15,255,408   12,145,762   10,345,235   10,811,704  
           
Performance measures:          
Net income$31,249  $11,827  $23,927  $29,237  $32,755  
Net interest margin 3.86%  4.31%  4.36%  3.67%  3.38% 
Pre-tax pre-provision earnings1 40,864   46,321   45,999   43,143   42,580  
Average diluted shares outstanding 85,536   80,717   71,374   61,961   61,923  
Diluted earnings per share (EPS)$0.37  $0.15  $0.34  $0.47  $0.53  
Return on (annualized):          
Average assets (ROA) 0.84%  0.34%  0.78%  1.10%  1.21% 
Average tangible assets (ROTA)2 1.06   0.52   0.94   1.17   1.29  
Average tangible common equity (ROTCE)2 12.08   5.96   10.36   11.53   13.01  
Tangible common equity to tangible assets2 8.53   8.36   9.08   9.79   9.74  
Tangible book value per share2$14.24  $14.25  $14.69  $15.98  $16.66  
Efficiency ratio 67.34%  65.43%  63.39%  57.13%  56.22% 
           
Adjusted operating measures1:          
Adjusted net income$49,203  $29,241  $39,926  $32,837  $36,327  
Adjusted pre-tax pre-provision earnings 64,856   71,081   66,649   48,989   46,397  
Adjusted diluted EPS 0.58   0.36   0.56   0.53   0.59  
Adjusted ROTA2 1.41%  0.90%  1.36%  1.27%  1.38% 
Adjusted ROTCE2 16.08   10.34   15.05   12.48   13.97  
Adjusted efficiency ratio 56.44   53.10   51.52   53.28   53.15  
Net adjusted noninterest expense as a
percent of average tangible assets2
 2.40   2.47   2.42   2.16   2.00  
           
Other data:          
Market capitalization3$1,880,407  $2,005,241  $2,233,761  $1,858,429  $2,028,996  
Full-time equivalent employees 1,670   1,650   1,490   1,156   1,095  
Number of ATMs 96   97   100   79   79  
Full-service banking offices 78   83   78   58   58  
1Non-GAAP measure, see “Explanation of Certain Unaudited Non-GAAP Financial Measures" for more information and a reconciliation to GAAP.
2The Company defines tangible assets as total assets less intangible assets, and tangible common equity as total shareholders’ equity less intangible assets.
3Common shares outstanding multiplied by closing bid price on last day of each period.
 

OTHER INFORMATION

Conference Call Information
Seacoast will host a conference call July 28th, 2023, at 10:00 a.m. Eastern Time, to discuss the second quarter 2023 earnings results and business trends. Investors may call in (toll-free) by dialing (800) 736-4594. 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.” Additionally, a recording of the call will be made available to individuals shortly after the conference call and can be accessed via a link at www.SeacoastBanking.com under the heading “Corporate Information.” The recording will be available for one year.

About Seacoast Banking Corporation of Florida (NASDAQ: SBCF)
Seacoast Banking Corporation of Florida (NASDAQ: SBCF) is one of the largest community banks headquartered in Florida with approximately $15.0 billion in assets and $12.3 billion in deposits as of June 30, 2023. Seacoast provides integrated financial services including commercial and consumer banking, wealth management, and mortgage services to customers at 78 full-service branches across Florida, and through advanced mobile and online banking solutions. Seacoast National Bank is the wholly-owned subsidiary bank of Seacoast Banking Corporation of Florida. For more information about Seacoast, visit www.SeacoastBanking.com.

Tracey L. Dexter
Chief Financial Officer
Seacoast Banking Corporation of Florida
(772) 403-0461

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, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), including, without limitation, statements about future financial and operating results, cost savings, enhanced revenues, economic and seasonal conditions in the Company’s markets, and improvements to reported earnings that may be realized from cost controls, tax law changes, new initiatives and for integration of banks that the Company has acquired, including Professional Holding Corp., or expects to acquire, as well as statements with respect to Seacoast’s objectives, strategic plans, 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 the Company’s 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 the Company’s control, and which may cause the actual results, performance or achievements of Seacoast Banking Corporation of Florida (“Seacoast” or the “Company”) or its wholly-owned banking subsidiary, Seacoast National Bank (“Seacoast Bank”), to be materially different from results, performance or achievements expressed or implied by such forward-looking statements. You should not expect the Company 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 the 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 impact of current and future economic and market conditions generally (including seasonality) and in the financial services industry, nationally and within Seacoast’s primary market areas, including the effects of inflationary pressures, changes in interest rates, slowdowns in economic growth, and the potential for high unemployment rates, as well as the financial stress on borrowers and changes to customer and client behavior and credit risk as a result of the foregoing; potential impacts of the recent adverse developments in the banking industry highlighted by high-profile bank failures, including impacts on customer confidence, deposit outflows, liquidity and the regulatory response thereto; 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, including those that impact the money supply and inflation and the possibility that the U.S. could default on its debt obligations; the risks of changes in interest rates on the level and composition of deposits (as well as the cost of, and competition for, deposits), loan demand, liquidity and the values of loan collateral, securities, and interest rate sensitive assets and liabilities; interest rate risks, sensitivities and the shape of the yield curve; changes in accounting policies, rules and practices; changes in retail distribution strategies, customer preferences and behavior generally and as a result of economic factors; 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; the Company’s concentration in commercial real estate loans and in real estate collateral in Florida; Seacoast’s ability to comply with any regulatory requirements; the effects of problems encountered by other financial institutions that adversely affect Seacoast or the banking industry; inaccuracies or other failures from the use of models, including 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 Seacoast’s investments due to market volatility or counterparty payment risk, as well as the effect of a decline in stock market prices on our fee income from our wealth management business; statutory and regulatory dividend restrictions; increases in regulatory capital requirements for banking organizations generally; the risks of mergers, acquisitions and divestitures, including Seacoast’s ability to continue to identify acquisition targets, successfully acquire and integrate desirable financial institutions and realize expected revenues and revenue synergies; changes in technology or products that may be more difficult, costly, or less effective than anticipated; the Company’s ability to identify and address increased cybersecurity risks; fraud or misconduct by internal or external, which Seacoast may not be able to prevent, detect or mitigate; inability of Seacoast’s risk management framework to manage risks associated with the Company’s business; dependence on key suppliers or vendors to obtain equipment or services for the business on acceptable terms, including the impact of supply chain disruptions; reduction in or the termination of Seacoast’s ability to use the online- or mobile-based platform that is critical to the Company’s business growth strategy; the effects of war or other conflicts, including the impacts related to or resulting from Russia’s military action in Ukraine, acts of terrorism, natural disasters, including hurricanes in the Company’s footprint, health emergencies, epidemics or pandemics, or other catastrophic events that may affect general economic conditions; unexpected outcomes of and the costs associated with, existing or new litigation involving the Company, including as a result of the Company’s participation in the Paycheck Protection Program (“PPP”); Seacoast’s 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 deferred tax assets could be reduced if estimates of future taxable income from the Company’s operations and tax planning strategies are less than currently estimated and sales of capital stock could trigger a reduction in the amount of net operating loss carryforwards that the Company 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, non-bank financial technology providers, securities brokerage firms, insurance companies, money market and other mutual funds and other financial institutions operating in the Company’s 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; the failure of assumptions underlying the establishment of reserves for possible credit losses; risks related to environmental, social and governance (“ESG”) matters, the scope and pace of which could alter Seacoast’s reputation and shareholder, associate, customer and third-party affiliations; the risks relating to bank acquisitions including the merger with Professional Holding Corp. including, without limitation: the diversion of management’s time on issues related to the merger; 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; regulatory enforcement and litigation risk; 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; and other factors and risks described under “Risk Factors” herein and in any of the Company’s subsequent reports filed with the SEC and available on its website at www.sec.gov

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 the Company’s annual report on Form 10-K for the year ended December 31, 2022 and quarterly report on Form 10-Q for the quarter ended June 30, 2023 under “Special Cautionary Notice Regarding Forward-Looking Statements” and “Risk Factors”, and otherwise in the Company’s 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  Six Months Ended
(Amounts in thousands, except ratios and per share data)2Q’231Q’234Q’223Q’222Q’22 2Q’23 2Q’22
Summary of Earnings         
Net income$ 31,249 $11,827 $23,927 $29,237 $32,755  $ 43,076  $53,343 
Adjusted net income1 49,203  29,241  39,926  32,837  36,327   78,444   63,383 
Net interest income2 127,153  131,351  119,858  88,399  81,764   258,504   158,403 
Net interest margin2,3 3.86 % 4.31% 4.36% 3.67% 3.38%  4.09 %  3.32%
Pre-tax pre-provision earnings1 40,864  46,321  45,999  43,143  42,580   87,185   75,675 
Adjusted pre-tax pre-provision earnings1 64,856  71,081  66,649  48,989  46,397   135,937   88,134 
Performance Ratios                       
Return on average assets-GAAP basis3 0.84 % 0.34% 0.78% 1.10% 1.21%  0.60 %  1.00%
Return on average tangible assets-GAAP basis3,4 1.06  0.52  0.94  1.17  1.29   0.80   1.07 
Adjusted return on average tangible assets1,3,4 1.41  0.90  1.36  1.27  1.38   1.16   1.23 
Pre-tax pre-provision return on average tangible assets1,3,4 1.33  1.58  1.69  1.71  1.66   1.45   1.51 
Adjusted pre-tax pre-provision return on average tangible assets1,3,4 1.85  2.18  2.28  1.89  1.77   2.01   1.70 
Net adjusted noninterest expense to average tangible assets1,3,4 2.40  2.47  2.42  2.16  2.00   2.44   2.00 
Return on average shareholders’ equity-GAAP basis3 6.05  2.53  6.03  8.60  9.73   4.38   7.82 
Return on average tangible common equity-GAAP basis3,4 12.08  5.96  10.36  11.53  13.01   9.14   10.46 
Adjusted return on average tangible common equity1,3,4 16.08  10.34  15.05  12.48  13.97   13.32   11.95 
Efficiency ratio5 67.34  65.43  63.39  57.13  56.22   66.37   59.17 
Adjusted efficiency ratio1 56.44  53.10  51.52  53.28  53.15   54.76   53.97 
Noninterest income to total revenue (excluding securities gains/losses) 14.63  14.55  12.84  15.72  17.45   14.59   17.30 
Tangible common equity to tangible assets4 8.53  8.36  9.08  9.79  9.74   8.53   9.74 
Average loan-to-deposit ratio 83.48  82.43  77.67  73.90  70.60   82.98   70.92 
End of period loan-to-deposit ratio 82.42  82.35  81.63  76.35  71.34   82.42   71.34 
Per Share Data         
Net income diluted-GAAP basis  $ 0.37  $ 0.15  $ 0.34  $ 0.47  $ 0.53   $ 0.52   $ 0.86 
Net income basic-GAAP basis 0.37  0.15  0.34  0.48  0.53   0.52   0.87 
Adjusted earnings1 0.58  0.36  0.56  0.53  0.59   0.94   1.03 
Book value per share common 24.14  24.24  22.45  20.95  21.65   24.14   21.65 
Tangible book value per share 14.24  14.25  14.69  15.98  16.66   14.24   16.66 
Cash dividends declared 0.18  0.17  0.17  0.17  0.17   0.35   0.30 
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 and losses).
 


CONDENSED CONSOLIDATED STATEMENTS OF INCOME(Unaudited)   
SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES
  Quarterly Trends  Six Months Ended
(Amounts in thousands, except per share data)2Q’231Q’234Q’223Q’222Q’22 2Q’23 2Q’22
          
Interest on securities:         
Taxable$ 20,898 $19,244$18,530 $15,653 $12,387  $ 40,142  $22,428 
Nontaxable 97  105 130  138  138   202   278 
Interest and fees on loans 148,265  135,168 105,322  73,970  69,307   283,433   136,425 
Interest on federal funds sold and other investments 5,023  3,474 3,127  1,643  1,917   8,497   2,850 
Total Interest Income 174,283  157,991 127,109  91,404  83,749   332,274   161,981 
          
Interest on deposits 27,183  16,033 3,934  1,623  994   43,216   1,761 
Interest on time certificates 14,477  5,552 1,358  380  436   20,029   904 
Interest on borrowed money 5,660  5,254 2,108  1,117  672   10,914   1,147 
Total Interest Expense 47,320  26,839 7,400  3,120  2,102   74,159   3,812 
          
Net Interest Income 126,963  131,152 119,709  88,284  81,647   258,115   158,169 
Provision for credit losses (764) 31,598 14,129  4,676  822   30,834   7,378 
Net Interest Income After Provision for Credit Losses 127,727  99,554 105,580  83,608  80,825   227,281   150,791 
          
Noninterest income:         
Service charges on deposit accounts 4,560  4,242 3,996  3,504  3,408   8,802   6,209 
Interchange income 5,066  4,694 4,650  4,138  4,255   9,760   8,383 
Wealth management income 3,318  3,063 2,886  2,732  2,774   6,381   5,433 
Mortgage banking fees 576  426 426  434  932   1,002   2,618 
Insurance agency income 1,160  1,101 805       2,261    
SBA gains 249  322 105  108  473   571   629 
BOLI income 2,068  1,916 1,526  1,363  1,349   3,984   2,683 
Other 4,755  6,574 3,239  4,186  4,073   11,329   7,134 
  21,752  22,338 17,633  16,465  17,264   44,090   33,089 
Securities (losses) gains, net (176) 107 18  (362) (300)  (69)  (752)
Total Noninterest Income 21,576  22,445 17,651  16,103  16,964   44,021   32,337 
          
Noninterest expenses:         
Salaries and wages 45,155  47,616 45,405  28,420  28,056   92,771   56,275 
Employee benefits 7,472  8,562 5,300  4,074  4,151   16,034   9,652 
Outsourced data processing costs 20,222  14,553 9,918  5,393  6,043   34,775   12,199 
Telephone / data lines 1,518  1,081 1,185  973  908   2,599   1,641 
Occupancy 7,065  6,938 5,457  5,046  4,050   14,003   8,036 
Furniture and equipment 2,345  2,267 1,944  1,462  1,588   4,612   3,014 
Marketing 2,047  2,238 1,772  1,461  1,882   4,285   3,053 
Legal and professional fees 4,062  7,479 9,174  3,794  2,946   11,541   7,735 
FDIC assessments 2,116  1,443 889  760  699   3,559   1,488 
Amortization of intangibles 7,654  6,727 4,763  1,446  1,446   14,381   2,892 
Foreclosed property expense and net (gain) loss on sale (57) 195 (411) 9  (968)  138   (1,132)
Provision for credit losses on unfunded commitments   1,239   1015     1,239   142 
Other 8,266  7,137 6,114  7,506  5,347   15,403   10,070 
Total Noninterest Expense 107,865  107,475 91,510  61,359  56,148   215,340   115,065 
          
Income Before Income Taxes 41,438  14,524 31,721  38,352  41,641   55,962   68,063 
Income taxes 10,189  2,697 7,794  9,115  8,886   12,886   14,720 
Net Income$ 31,249 $11,827$23,927 $29,237 $32,755  $ 43,076  $53,343 
          
Per share of common stock:         
          
Net income diluted$ 0.37 $0.15$0.34 $0.47 $0.53  $ 0.52  $0.86 
Net income basic 0.37  0.15 0.34  0.48  0.53   0.52   0.87 
Cash dividends declared 0.18  0.17 0.17  0.17  0.17   0.35   0.30 
          
Average diluted shares outstanding 85,536  80,717 71,374  61,961  61,923   83,260   61,818 
Average basic shares outstanding 85,022  80,151 70,770  61,442  61,409   82,600   61,269 
          


CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)  
SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES     
 June 30, March 31, December 31, September 30, June 30,
(Amounts in thousands) 2023   2023   2022   2022   2022 
Assets         
Cash and due from banks$ 164,193  $180,607  $120,748  $176,463  $363,343 
Interest bearing deposits with other banks 563,690   610,636   81,192   42,152   538,025 
Total Cash and Cash Equivalents 727,883   791,243   201,940   218,615   901,368 
          
Time deposits with other banks 2,987   3,236   3,236   4,481   4,730 
          
Debt Securities:         
Available for sale (at fair value) 1,916,231   2,015,967   1,871,742   1,860,734   1,800,791 
Held to maturity (at amortized cost) 707,812   737,911   747,408   774,706   794,785 
Total Debt Securities 2,624,043   2,753,878   2,619,150   2,635,440   2,595,576 
          
Loans held for sale 5,967   2,838   3,151   1,620   14,205 
          
Loans 10,117,919   10,134,395   8,144,724   6,690,845   6,541,548 
Less: Allowance for credit losses (159,715)  (155,640)  (113,895)  (95,329)  (90,769)
Net Loans 9,958,204   9,978,755   8,030,829   6,595,516   6,450,779 
          
Bank premises and equipment, net 116,959   116,522   116,892   81,648   74,784 
Other real estate owned 7,526   7,756   2,301   2,419   2,419 
Goodwill 732,910   728,396   480,319   286,606   286,606 
Other intangible assets, net 109,716   117,409   75,451   18,583   20,062 
Bank owned life insurance 293,880   292,545   237,824   209,087   207,724 
Net deferred tax assets 127,941   124,301   94,457   83,139   60,080 
Other assets 333,916   338,529   280,212   208,081   193,371 
Total Assets$ 15,041,932  $15,255,408  $12,145,762  $10,345,235  $10,811,704 
          
Liabilities and Shareholders’ Equity         
Liabilities         
Deposits         
Noninterest demand$ 4,139,052  $4,554,509  $4,070,973  $3,529,489  $3,593,201 
Interest-bearing demand 2,816,656   2,676,320   2,337,590   2,170,251   2,269,148 
Savings 824,255   940,702   1,064,392   938,081   946,738 
Money market 2,859,164   2,893,128   1,985,974   1,700,737   1,911,847 
Other time certificates 628,036   598,483   369,389   312,840   350,571 
Brokered time certificates 591,503   371,392   3,798       
Time certificates of more than $250,000 424,601   275,167   149,479   114,016   117,448 
Total Deposits 12,283,267   12,309,701   9,981,595   8,765,414   9,188,953 
          
Securities sold under agreements to repurchase 290,156   267,606   172,029   94,191   110,578 
Federal Home Loan Bank borrowings 160,000   385,000   150,000       
Subordinated debt, net 105,970   105,804   84,533   71,857   71,786 
Other liabilities 148,507   136,213   149,830   125,971   110,812 
Total Liabilities 12,987,900   13,204,324   10,537,987   9,057,433   9,482,129 
          
Shareholders’ Equity         
Common stock 8,509   8,461   7,162   6,148   6,141 
Additional paid in capital 1,809,431   1,803,898   1,377,802   1,068,241   1,065,167 
Retained earnings 437,087   421,271   423,863   412,166   393,431 
Treasury stock (14,171)  (13,113)  (13,019)  (11,539)  (11,632)
  2,240,856   2,220,517   1,795,808   1,475,016   1,453,107 
Accumulated other comprehensive (loss) income, net (186,824)  (169,433)  (188,033)  (187,214)  (123,532)
Total Shareholders’ Equity 2,054,032   2,051,084   1,607,775   1,287,802   1,329,575 
Total Liabilities & Shareholders’ Equity$ 15,041,932  $15,255,408  $12,145,762  $10,345,235  $10,811,704 
          
Common shares outstanding 85,086   84,609   71,618   61,476   61,410 
                    


CONSOLIDATED QUARTERLY FINANCIAL DATA (Unaudited)   
SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES
 
            
(Amounts in thousands) 2Q’23 1Q’23 4Q’22 3Q’22 2Q’22 
Credit Analysis           
Net charge-offs (recoveries) $ 705  $3,188  $782  $103  $(124) 
Net charge-offs (recoveries) to average loans  0.03 %  0.14%  0.04%  0.01%  % 
Allowance for credit losses  159,715   155,640   113,895   95,329   90,769  
            
Non-acquired loans at end of period  6,264,044   6,048,453   5,944,194   5,653,357   5,399,923  
Acquired loans at end of period  3,853,875   4,085,942   2,200,530   1,037,488   1,141,625  
Total Loans $ 10,117,919  $10,134,395  $8,144,724  $6,690,845  $6,541,548  
            
Total allowance for credit losses to total loans at end of period  1.58   1.54   1.40   1.42   1.39  
Purchase discount on acquired loans at end of period  4.98   5.02   4.25   1.81   1.84  
            
End of Period           
Nonperforming loans $ 48,326  $50,787  $28,843  $21,464  $26,442  
Other real estate owned  530   530   530   109   109  
Properties previously used in bank operations included in other real estate owned  6,996   7,226   1,771   2,310   2,310  
Total Nonperforming Assets $ 55,852  $58,543  $31,144  $23,883  $28,861  
            
Nonperforming Loans to Loans at End of Period  0.48 %  0.50%  0.35%  0.32%  0.40% 
Nonperforming Assets to Total Assets at End of Period  0.37   0.38   0.26   0.23   0.27  
            
  June 30, March 31, December 31, September 30, June 30, 
Loans  2023   2023   2022   2022   2022  
Construction and land development $ 794,371  $757,835  $587,332  $361,913  $350,025  
Commercial real estate - owner occupied  1,669,369   1,652,491   1,478,302   1,253,459   1,254,343  
Commercial real estate - non-owner occupied 1  3,370,211   3,412,051   2,589,774   2,107,614   1,972,540  
Residential real estate 1  2,396,352   2,354,394   1,849,503   1,599,765   1,647,465  
Commercial and financial  1,610,895   1,650,485   1,348,636   1,182,384   1,124,771  
Consumer  272,082   301,740   286,587   180,416   175,201  
Paycheck Protection Program  4,639   5,399   4,590   5,294   17,203  
Total Loans $ 10,117,919  $10,134,395  $8,144,724  $6,690,845  $6,541,548  
1 In 3Q’22, $100 million in loans to commercial borrowers collateralized by residential properties were reclassified from “Residential real estate” to “Commercial real estate - non-owner occupied.” 
  


AVERAGE BALANCES, INTEREST INCOME AND EXPENSES, YIELDS AND RATES 1   (Unaudited)   
SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES            
                   
                   
 2Q’23 1Q’23 2Q’22 
 Average   Yield/ Average   Yield/ Average   Yield/ 
(Amounts in thousands)Balance Interest Rate Balance Interest Rate Balance Interest Rate 
                   
Assets                  
Earning assets:                  
Securities:                  
Taxable$ 2,673,633  $ 20,898 3.13% $2,700,122  $19,244 2.85% $2,517,879  $12,387 1.97% 
Nontaxable 15,621   120 3.08   16,271   131 3.22   22,443   175 3.12  
Total Securities 2,689,254   21,018 3.13   2,716,393   19,375 2.85   2,540,322   12,562 1.98  
                   
Federal funds sold 327,433   4,313 5.28   106,778   1,294 4.91   644,144   1,281 0.80  
Interest bearing deposits with other banks and other investments 90,783   710 3.14   178,463   2,180 4.95   46,257   636 5.51  
                  
                   
Loans excluding PPP loans 10,096,394   148,420 5.90   9,363,873   135,329 5.86   6,454,444   68,647 4.27  
PPP loans 4,834   12 1.00   5,328   12 0.91   26,322   741 11.29  
Total Loans 10,101,228   148,432 5.89   9,369,201   135,341 5.86   6,480,766   69,388 4.29  
                   
Total Earning Assets 13,208,698   174,473 5.30   12,370,835   158,190 5.19   9,711,489   83,867 3.46  
                   
Allowance for credit losses (156,207)      (139,989)      (90,242)     
Cash and due from banks 165,625       156,235       389,695      
Premises and equipment 117,726       116,083       74,614      
Intangible assets 842,988       750,694       307,411      
Bank owned life insurance 293,251       274,517       206,839      
Other assets including deferred tax assets 415,208       419,601       240,712      
                   
Total Assets$ 14,887,289      $13,947,976      $10,840,518      
                   
Liabilities and Shareholders’ Equity                  
Interest-bearing liabilities:                  
Interest-bearing demand$ 2,666,314  $ 7,560 1.14% $2,452,113  $3,207 0.53% $2,262,408  $293 0.05% 
Savings 906,936   427 0.19   1,053,220   400 0.15   962,264   64 0.03  
Money market 2,806,672   19,196 2.74   2,713,224   12,426 1.86   1,938,421   637 0.13  
Time deposits 1,425,344   14,477 4.07   812,422   5,552 2.77   496,186   436 0.35  
Securities sold under agreements to repurchase 244,824   1,593 2.61   173,498   864 2.02   120,437   94 0.31  
Federal Home Loan Bank borrowings 251,596   2,272 3.62   282,444   2,776 3.99         
Subordinated debt 105,861   1,795 6.80   98,425   1,614 6.65   71,740   579 3.24  
                   
Total Interest-Bearing Liabilities 8,407,547   47,320 2.26   7,585,346   26,839 1.43   5,851,456   2,103 0.14  
                   
Noninterest demand 4,294,251       4,334,969       3,520,700      
Other liabilities 114,962       130,616       117,794      
Total Liabilities 12,816,760       12,050,931       9,489,950      
                   
Shareholders’ equity 2,070,529       1,897,045       1,350,568      
                   
Total Liabilities & Equity $14,887,289       $13,947,976       $10,840,518      
                   
Cost of deposits    1.38%     0.77%     0.06% 
Interest expense as a % of earning assets    1.44%     0.88%     0.09% 
Net interest income as a % of earning assets   $127,153 3.86%    $131,351 4.31%    $81,764 3.38% 
                   
                   
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
 
             
             
 Six Months Ended June 30, 2023 Six Months Ended June 30, 2022 
 Average   Yield/ Average   Yield/ 
(Amounts in thousands)Balance Interest Rate Balance Interest Rate 
             
Assets            
Earning assets:            
Securities:            
Taxable$ 2,686,804  $ 40,142 2.99% $2,462,447  $22,428 1.82% 
Nontaxable 15,944   251 3.15   23,238   352 3.03  
Total Securities 2,702,748   40,393 2.99   2,485,685   22,780 1.83  
             
Federal funds sold 228,491   5,787 5.11   691,105   1,631 0.48  
Interest bearing deposits with other banks and other investments 90,750   2,710 6.02   45,631   1,219 5.39  
             
             
Loans excluding PPP loans 9,732,156   283,749 5.88   6,366,194   134,322 4.25  
PPP loans 5,080   24 0.95   44,024   2,264 10.37  
Total Loans 9,737,236   283,773 5.88   6,410,218   136,586 4.30  
             
Total Earning Assets 12,759,225   332,663 5.26   9,632,639   162,216 3.40  
             
Allowance for credit losses (148,143)      (88,862)     
Cash and due from banks 193,811       377,831      
Premises and equipment 116,909       75,241      
Intangible assets 797,096       305,875      
Bank owned life insurance 283,936       206,173      
Other assets including deferred tax assets 417,393       226,205      
             
Total Assets$ 14,420,227      $10,735,102      
             
Liabilities and Shareholders’ Equity            
Interest-bearing liabilities:            
Interest-bearing demand$ 2,559,805  $ 10,767 0.85% $2,180,351  $483 0.04% 
Savings 979,674   827 0.17   943,908   129 0.03  
Money market 2,760,207   31,622 2.31   1,957,435   1,149 0.12  
Time deposits 1,120,576   20,029 3.60   528,255   904 0.35  
Securities sold under agreements to repurchase 209,358   2,456 2.37   119,298   133 0.22  
Federal Home Loan Bank borrowings 266,935   5,048 3.81         
Subordinated debt 102,164   3,410 6.73   71,706   1,015 2.85  
             
Total Interest-Bearing Liabilities 7,998,719   74,159 1.87   5,800,953   3,813 0.13  
             
Noninterest demand 4,314,498       3,428,921      
Other liabilities 122,746       129,815      
Total Liabilities 12,435,963       9,359,689      
             
Shareholders’ equity 1,984,264       1,375,413      
             
Total Liabilities & Equity $14,420,227       $10,735,102      
             
Cost of deposits    1.09%     0.06% 
Interest expense as a % of earning assets    1.17%     0.08% 
Net interest income as a % of earning assets   $258,504 4.09%    $158,403 3.32% 
             
             
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
(Amounts in thousands)June 30, 2023 March 31, 2023 December 31, 2022 September 30, 2022 June 30, 2022 
Customer Relationship Funding          
Noninterest demand          
Commercial$ 3,304,761 $3,622,441 $3,148,778 $2,827,591 $2,945,445 
Retail 615,536  673,686  764,274  447,848  464,214 
Public funds 152,159  194,977  112,553  210,662  143,075 
Other 66,596  63,405  45,368  43,388  40,467 
Total Noninterest Demand 4,139,052  4,554,509  4,070,973  3,529,489  3,593,201 
           
Interest-bearing demand          
Commercial 1,555,486  1,233,845  886,894  759,286  769,948 
Retail 1,058,993  1,209,664  1,191,192  1,199,112  1,207,698 
Brokered   44,474  54,777  81,799   
Public funds 202,177  188,337  204,727  130,054  291,502 
Total Interest-Bearing Demand 2,816,656  2,676,320  2,337,590  2,170,251  2,269,148 
           
Total transaction accounts          
Commercial 4,860,247  4,856,286  4,035,672  3,586,877  3,715,393 
Retail 1,674,529  1,883,350  1,955,466  1,646,960  1,671,912 
Brokered   44,474  54,777  81,799   
Public funds 354,336  383,314  317,280  340,716  434,577 
Other 66,596  63,405  45,368  43,388  40,467 
Total Transaction Accounts 6,955,708  7,230,829  6,408,563  5,699,740  5,862,349 
Savings          
Commercial 101,908  108,023  91,943  71,807  70,090 
Retail 722,347  832,679  972,449  866,274  876,648 
Total Savings 824,255  940,702  1,064,392  938,081  946,738 
Money market          
Commercial 1,426,348  1,542,220  932,518  788,009  819,452 
Retail 1,275,721  1,279,712  984,561  857,914  914,918 
Brokered         106,823 
Public funds 157,095  71,196  68,895  54,814  70,654 
Total Money Market 2,859,164  2,893,128  1,985,974  1,700,737  1,911,847 
Brokered time certificates 591,503  371,392  3,798     
Other time certificates 1,052,637  873,650  518,868  426,856  468,019 
  1,644,140  1,245,042  522,666  426,856  468,019 
Total Deposits $ 12,283,267  $ 12,309,701  $ 9,981,595  $ 8,765,414  $ 9,188,953 
           
Customer sweep accounts 290,156  267,606  172,029  94,191  110,578 
           

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  Six Months Ended
(Amounts in thousands, except per share data)2Q’231Q’234Q’223Q’222Q’22 2Q’232Q’22
Net Income$ 31,249 $11,827 $23,927 $29,237 $32,755  $ 43,076 $53,343 
         
Total noninterest income 21,576  22,445  17,651  16,103  16,964   44,021  32,337 
Securities losses (gains), net 176  (107) (18) 362  300   69  752 
BOLI benefits on death (included in other income)   (2,117)        (2,117)  
Total Adjustments to Noninterest Income 176  (2,224) (18) 362  300   (2,048) 752 
Total Adjusted Noninterest Income 21,752  20,221  17,633  16,465  17,264   41,973  33,089 
         
Total noninterest expense 107,865  107,475  91,510  61,359  56,148   215,340  115,065 
Salaries and wages (1,573) (4,240) (5,680)   (652)  (5,813) (3,605)
Outsourced data processing costs (10,904) (6,551) (2,582)   (420)  (17,455) (1,052)
Legal and professional fees (1,664) (4,789) (6,485) (1,791) (1,381)  (6,453) (4,272)
Other categories (1,507) (1,952) (1,393) (263) (586)  (3,459) (802)
Total merger related charges (15,648) (17,532) (16,140) (2,054) (3,039)  (33,180) (9,731)
Amortization of intangibles (7,654) (6,727) (4,763) (1,446) (1,446)  (14,381) (2,892)
Branch reductions and other expense initiatives (571) (1,291) (176) (960)    (1,862) (74)
Total Adjustments to Noninterest Expense (23,873) (25,550) (21,079) (4,460) (4,485)  (49,423) (12,697)
Total Adjusted Noninterest Expense 83,992  81,925  70,431  56,899  51,663   165,917  102,368 
         
Income Taxes 10,189  2,697  7,794  9,115  8,886   12,886  14,720 
Tax effect of adjustments 6,095  5,912  5,062  1,222  1,213   12,007  3,409 
Adjusted Income Taxes 16,284  8,609  12,856  10,337  10,099   24,893  18,129 
Adjusted Net Income$ 49,203 $29,241 $39,926 $32,837 $36,327  $ 78,444 $63,383 
         
Earnings per diluted share, as reported$ 0.37 $0.15 $0.34 $0.47 $0.53  $ 0.52 $0.86 
Adjusted Earnings per Diluted Share 0.58  0.36  0.56  0.53  0.59   0.94  1.03 
Average diluted shares outstanding 85,536  80,717  71,374  61,961  61,923   83,260  61,818 
         
Adjusted Noninterest Expense$ 83,992 $81,925 $70,431 $56,899 $51,663  $ 165,917 $102,368 
Provision for credit losses on unfunded commitments   (1,239)   (1,015)    (1,239) (142)
Foreclosed property expense and net loss (gain) on sale 57  (195) 411  (9) 968   (138) 1,132 
Net Adjusted Noninterest Expense$ 84,049 $80,491 $70,842 $55,875 $52,631  $ 164,540 $103,358 
         
Revenue$ 148,539 $153,597 $137,360 $104,387 $98,611  $ 302,136 $190,506 
Total Adjustments to Revenue 176  (2,224) (18) 362  300   (2,048) 752 
Impact of FTE adjustment 190  199  149  115  117   389  234 
Adjusted Revenue on a fully taxable equivalent basis$ 148,905 $151,572 $137,491 $104,864 $99,028  $ 300,477 $191,492 
Adjusted Efficiency Ratio 56.44 % 53.10% 51.52% 53.28% 53.15%  54.76 % 53.97%
         
Net Interest Income$ 126,963 $131,152 $119,709 $88,284 $81,647  $ 258,115 $158,169 
Impact of FTE adjustment 190  199  149  115  117   389  234 
Net Interest Income including FTE adjustment$ 127,153 $131,351 $119,858 $88,399 $81,764  $ 258,504 $158,403 
Total noninterest income 21,576  22,445  17,651  16,103  16,964   44,021  32,337 
Total noninterest expense 107,865  107,475  91,510  61,359  56,148   215,340  115,065 
Pre-Tax Pre-Provision Earnings$ 40,864 $46,321 $45,999 $43,143 $42,580  $ 87,185 $75,675 
Total Adjustments to Noninterest Income 176  (2,224) (18) 362  300   (2,048) 752 
Total Adjustments to Noninterest Expense (23,816) (26,984) (20,668) (5,484) (3,517)  (50,800) (11,707)
Adjusted Pre-Tax Pre-Provision Earnings$ 64,856 $71,081 $66,649 $48,989 $46,397  $ 135,937 $88,134 
         
Average Assets$ 14,887,289 $13,947,976 $12,139,856 $10,585,338 $10,840,518  $ 14,420,227 $10,735,102 
Less average goodwill and intangible assets (842,988) (750,694) (521,412) (305,935) (307,411)  (797,096) (305,875)
Average Tangible Assets$ 14,044,301 $13,197,282 $11,618,444 $10,279,403 $10,533,107  $ 13,623,131 $10,429,227 
         
         
GAAP TO NON-GAAP RECONCILIATION  (Unaudited)   
SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES
   
  Quarterly Trends  Six Months Ended
(Amounts in thousands, except per share data)2Q’231Q’234Q’223Q’222Q’22 2Q’232Q’22
Return on Average Assets (ROA) 0.84 % 0.34% 0.78% 1.10% 1.21%  0.60 % 1.00%
Impact of removing average intangible assets and related amortization 0.22  0.18  0.16  0.07  0.08   0.20  0.07 
Return on Average Tangible Assets (ROTA) 1.06  0.52  0.94  1.17  1.29   0.80  1.07 
Impact of other adjustments for Adjusted Net Income 0.35  0.38  0.42  0.10  0.09   0.36  0.16 
Adjusted Return on Average Tangible Assets 1.41  0.09  1.36  1.27  1.38   1.16