Seacoast Reports Fourth Quarter and Full Year 2022 Results


Fourth Quarter 2022 Net Interest Margin Expands to 4.36%, Up 69 Basis Points from Prior Quarter

Completes Acquisitions of Apollo Bancshares, Inc. and Drummond Banking Company

Well-Positioned Balance Sheet with Strong Capital Position

STUART, Fla., Jan. 26, 2023 (GLOBE NEWSWIRE) -- Seacoast Banking Corporation of Florida ("Seacoast" or the "Company") (NASDAQ: SBCF) today reported net income in the fourth quarter of 2022 of $23.9 million, or $0.34 per diluted share, including $16.1 million in merger-related costs and $15.0 million in provision for credit losses associated with bank acquisitions during the quarter. Fourth quarter 2022 net income decreased 18% compared to the third quarter of 2022 and decreased 34% compared to the fourth quarter of 2021, each the result of bank merger activity in the fourth quarter 2022. For the full year 2022, net income was $106.5 million, or $1.66 per diluted share, a decrease of 14% compared to the full year 2021.

Adjusted net income1 for the fourth quarter of 2022 was $39.9 million, or $0.56 per diluted share, which included $15.0 million in the provision for credit losses associated with acquisition activity during the quarter. Fourth quarter 2022 adjusted net income1 increased 22% compared to the third quarter 2022 and increased 8% compared to the fourth quarter 2021. Adjusted net income1 for the full year 2022 was $136.1 million, or $2.12 per diluted share, an increase of 1% compared to the full year 2021.

Pre-tax pre-provision earnings1 were $46.0 million in the fourth quarter 2022, an increase of 7% compared to the third quarter of 2022 and 13% compared to the fourth quarter 2021. For the year ended December 31, 2022, pre-tax pre-provision earnings1 were $164.8 million, an increase of 10% compared to the full year 2021. Adjusted pre-tax pre-provision earnings1 were $66.6 million in the fourth quarter 2022, an increase of 36% compared to the third quarter 2022 and 58% compared to the fourth quarter 2021. Adjusted pre-tax pre-provision earnings1 for the full year 2022 were $203.8 million, an increase of $39.2 million or 24% when compared to the full year 2021.

For the fourth quarter of 2022, return on average tangible assets was 0.94%, return on average tangible shareholders' equity was 10.36%, and the efficiency ratio was 63.39%, compared to 1.17%, 11.53%, and 57.13%, respectively, in the prior quarter, and 1.51%, 14.29%, and 53.70%, respectively, in the prior year quarter. For the full year 2022, return on average tangible assets was 1.06%, return on average tangible shareholders’ equity was 10.70%, and the efficiency ratio was 60.01%, compared to 1.41%, 13.27%, and 55.39%, respectively, in the full year 2021. Adjusted return on average tangible assets1 in the fourth quarter of 2022 was 1.36%, adjusted return on average tangible shareholders' equity1 was 15.05%, and the adjusted efficiency ratio1 was 51.52%, compared to 1.27%, 12.48%, and 53.28%, respectively, in the prior quarter, and 1.49%, 14.11%, and 53.43%, respectively, in the prior year quarter. Adjusted return on average tangible assets1 for the full year 2022 was 1.27%, adjusted return on average tangible shareholders’ equity1 was 10.70%, and the adjusted efficiency ratio1 was 53.03%, compared to 1.48%, 13.27%, and 52.59%, respectively, for the full year 2021.

Charles M. Shaffer, Seacoast's Chairman and CEO said, "The fourth quarter of 2022 was another outstanding quarter, during which we delivered an adjusted pre-tax pre-provision return on tangible assets1 of 2.28%, expanded our net interest margin by 69 basis points and drove our adjusted efficiency ratio1 to 51.52%.

For the year as a whole, 2022 was one of achievement. Seacoast’s team drove significant market expansion across the state, extending our franchise to Sarasota, Ocala, Gainesville, Jacksonville, Naples, and Miami through acquisitions and new market launches. Additionally, we significantly improved the digital product set for our customers, adding new features and functionality; transformed our commercial banking franchise, adding talent throughout Florida; and achieved another record-breaking year in wealth management. Finally, we made significant investments in talent and technology to scale our operational areas to those of a mid-size bank."

Acquisitions Update

Seacoast’s balanced growth strategy, combining organic growth with value-creating acquisitions, continues to benefit shareholders and expand the franchise across Florida.

In the first quarter of 2022, Seacoast completed the acquisitions of Sabal Palm Bancorp, Inc. (“Sabal Palm”) in Sarasota and Business Bank of Florida Corp. (“BBFC”) in Brevard County, which collectively added a combined $368 million in loans and $562 million in deposits. Integration activities, including system conversion, were completed in the first quarter of 2022 for BBFC and in the second quarter of 2022 for Sabal Palm.

On October 7, 2022, the Company completed the acquisition of Apollo Bancshares, Inc. (“Apollo”), adding approximately $665 million in loans and $855 million in deposits, and taking Seacoast into Miami-Dade County, one of the fastest growing and most dynamic markets in the United States. System conversion activities were completed immediately after the closing of the transaction.

Also on October 7, 2022, the Company completed the acquisition of Drummond Banking Company (“Drummond”), providing Seacoast with an entry point into Gainesville, Ocala, and surrounding markets and adding low-cost core deposits and diversified business lines. At closing, Drummond had approximately $545 million in loans and $883 in deposits, providing a strong core deposit base and also highlighting the benefits of stable depository relationships we expect to be able to support higher margins in a rising rate environment. Full integration and system conversion activities are expected to be completed in the first quarter of 2023.

On August 8, 2022, the Company announced its proposed acquisition of Professional Holding Corp. (“Professional”) (NASDAQ: PFHD), the sixth largest bank headquartered in South Florida. The transaction, which is expected to close in the first quarter of 2023, will increase Seacoast’s market share in Miami-Dade, Broward, and Palm Beach counties. Full integration and system conversion activities are expected to be completed late in the second quarter of 2023.

Financial Results

Income Statement

  • Net income was $23.9 million, or $0.34 per diluted share, for the fourth quarter of 2022 compared to net income of $29.2 million, or $0.47 per diluted share, for the prior quarter, and $36.3 million, or $0.62 per diluted share, for the prior year quarter. For the year ended December 31, 2022, net income was $106.5 million, or $1.66 per diluted share, compared to $124.4 million, or $2.18 per diluted share, for the year ended December 31, 2021. The current full-year results included $26.2 million in provision for credit losses, including $15.0 million in the fourth quarter of 2022 recorded for loans acquired in the Drummond and Apollo acquisitions, and $5.1 million in the first quarter of 2022 recorded for loans acquired in the Sabal Palm and BBFC transactions. Prior year results included the reversal of provision for credit losses of $9.4 million, reflecting improvement at the time in post-COVID economic indicators. Adjusted net income1 for the fourth quarter of 2022 was $39.9 million, or $0.56 per diluted share. This compares to $32.8 million, or $0.53 per diluted share, for the prior quarter, and $36.9 million, or $0.62 per diluted share, for the prior year quarter. For the year ended December 31, 2022, adjusted net income1 was $136.1 million, or $2.12 per diluted share, compared to $135.0 million, or $2.36 per diluted share, for the year ended December 31, 2021.
  • Net revenues were $137.4 million in the fourth quarter of 2022, an increase of $33.0 million, or 32%, compared to the prior quarter, and an increase of $46.4 million, or 51%, compared to the prior year quarter. For the year ended December 31, 2022, net revenues were $432.3 million, an increase of $85.5 million, or 25%, compared to the year ended December 31, 2021. Adjusted revenues1 were $137.3 million in the fourth quarter of 2022, an increase of $32.6 million, or 31%, compared to the prior quarter, and an increase of $46.7 million, or 52%, compared to the prior year quarter. For the year ended December 31, 2022, adjusted revenues1 were $433.3 million, an increase of $86.8 million, or 25%, compared to the year ended December 31, 2021.
  • On an adjusted basis, pre-tax pre-provision earnings1 were $66.6 million, an increase of 36% compared to the third quarter of 2022 and an increase of 58% compared to the fourth quarter of 2021. Adjusted pre-tax pre-provision earnings1 for the full year 2022 were $203.8 million, an increase of 24% when compared to the full year of 2021.
  • Net interest income totaled $119.7 million in the fourth quarter of 2022, an increase of $31.4 million, or 36%, from the third quarter of 2022 and an increase of $47.4 million, or 66%, compared to the fourth quarter of 2021. For the year ended December 31, 2022, net interest income was $366.2 million, an increase of $90.1 million, or 33%, compared to the year ended December 31, 2021.
  • Net interest margin increased 69 basis points to 4.36% in the fourth quarter of 2022 compared to 3.67% in the third quarter of 2022. Excluding the effects of accretion on acquired loans, net interest margin increased 43 basis points to 4.01% in the fourth quarter of 2022. Securities yields increased 41 basis points to 2.77%, and loan yields increased 84 basis points to 5.29%. The effect on net interest margin of accretion of purchase discounts on acquired loans in the fourth quarter of 2022 was 35 basis points, compared to nine basis points in the third quarter of 2022. The cost of deposits increased 12 basis points to 21 basis points for the fourth quarter of 2022 compared to nine basis points in the prior quarter.
  • Noninterest income totaled $17.7 million in the fourth quarter of 2022, an increase of $1.5 million, or 10%, compared to the prior quarter, and a decrease of $1.1 million, or 6%, compared to the prior year quarter. For the year ended December 31, 2022, noninterest income was $66.1 million, a decrease of $4.6 million, or 7%, compared to the year ended December 31, 2021. Results for the fourth quarter of 2022 included the following:
    • Service charges on deposits increased $0.5 million compared to the prior quarter and $1.4 million year over year, reflecting the benefit of an expanded deposit base including from acquisitions.
    • Interchange income increased $0.5 million compared to the prior quarter, primarily attributed to an expanded customer base.
    • Despite the impact of market declines, the wealth management division has demonstrated continued success in building relationships, and during the fourth quarter of 2022, assets under management grew $159.5 million, driving a $0.2 million or 6% increase in wealth management income quarter over quarter. During 2022, the wealth management division added a record breaking $425 million in assets under management.
  • The provision for credit losses was $14.1 million in the fourth quarter of 2022, compared to $4.7 million in the prior quarter. A $15.0 million provision recorded in the Apollo and Drummond acquisitions was partially offset by the release of $2.1 million added in the third quarter of 2022 for potential losses related to hurricane Ian that did not materialize.
  • Noninterest expense was $91.5 million in the fourth quarter of 2022, an increase of $30.2 million, or 49%, compared to the prior quarter, and an increase of $41.2 million, or 82%, compared to the prior year quarter. The current quarter included $16.1 million of merger related expenses, compared to $2.1 million in the prior quarter and $0.5 million in the prior year quarter. Noninterest expense was $267.9 million for the year ended December 31, 2022, including $27.9 million in merger-related charges, compared to $197.4 million in the year ended December 31, 2021, which included $7.9 million in merger-related charges. Changes from the third quarter of 2022 included the following:
    • Salaries and wages increased $17.0 million to $45.4 million in the fourth quarter of 2022. The fourth quarter of 2022 includes $5.7 million in merger-related expenses as well as overhead associated with adding 20 branch locations, bankers, and operational staff associated with the acquisitions of Apollo and Drummond. We expect the full benefit of cost synergies to materialize beginning in the second quarter of 2023.
    • Employee benefits increased $1.2 million to $5.3 million in the fourth quarter of 2022, reflecting higher payroll taxes and healthcare-related costs attributed to higher headcount. 
    • Outsourced data processing costs increased by $4.5 million in the fourth quarter of 2022, which includes $2.6 million in direct acquisition related expenses. The remainder of the increase is the result of higher transaction volume and the growth in customers with the two bank acquisitions.
    • Occupancy, telephone and data lines, and furniture and equipment expenses collectively increased $1.1 million to $8.6 million in the fourth quarter of 2022, reflecting the expanded footprint from the addition of Apollo and Drummond locations.
    • Legal and professional fees increased by $5.4 million to $9.2 million in the fourth quarter of 2022, including a $4.7 million increase in merger-related expenses during the quarter.
    • Other expenses decreased by $1.4 million, driven by lower recruiting costs in the quarter.
    • Amortization of intangibles increased $3.3 million with the addition of $61.7 million in intangible assets from the acquisitions of Drummond and Apollo. These assets will be amortized using an accelerated amortization method over approximately six years. 
  • Seacoast recorded $7.8 million of income tax expense in the fourth quarter of 2022, compared to $9.1 million in the third quarter of 2022 and $8.3 million in the fourth quarter of 2021. The second quarter of 2022 included a $1.0 million refund of Florida corporate income tax paid in prior periods. Tax benefits related to stock-based compensation totaled $0.2 million in the fourth quarter of 2022, $0.2 million in the third quarter of 2022, and $0.6 million in the fourth quarter of 2021.
  • The ratio of net adjusted noninterest expense1 to average tangible assets was 2.42% in the fourth quarter of 2022, compared to 2.16% in the third quarter of 2022 and 1.96% in the fourth quarter of 2021. The increase in the ratio was primarily driven by higher expenses during the quarter resulting from expansion of the franchise.
  • The efficiency ratio was 63.39% in the fourth quarter of 2022, compared to 57.13% in the third quarter of 2022 and 53.70% in the prior year quarter. The adjusted efficiency ratio1 was 51.52% in the fourth quarter of 2022, compared to 53.28% in the third quarter of 2022 and 53.43% in the prior year quarter. The Company continues to remain keenly focused on disciplined expense control. The adjusted efficiency ratio1 for the full year 2022 was 53.03% compared to 52.59% for the full year 2021.

Balance Sheet

  • At December 31, 2022, the Company had total assets of $12.1 billion and total shareholders' equity of $1.6 billion. Book value per share was $22.45 on December 31, 2022, compared to $20.95 on September 30, 2022, and $22.40 on December 31, 2021. Tangible book value per share totaled $14.69 on December 31, 2022 compared to $15.98 on September 30, 2022 and $17.84 on December 31, 2021. The decline during 2022 in the value of the available for sale securities portfolio driven by rising interest rates negatively impacted tangible book value per share by $2.53 when compared to December 31, 2021.
  • Debt securities totaled $2.6 billion on December 31, 2022, a decrease of $16.3 million, or 1%, compared to September 30, 2022.
  • Loans totaled $8.1 billion on December 31, 2022, an increase of $1.5 billion compared to September 30, 2022.  The increase includes loans acquired of  $665.1 million and $545.2 million from Apollo and Drummond, respectively, and $240.8 million in organic loan growth. The Company continues to exercise a disciplined approach to loan growth, carefully underwriting loans to strict underwriting guidelines.
  • Loan originations were $649.2 million in the fourth quarter of 2022, an increase of 17% compared to $554.7 million in the third quarter of 2022. The weighted average add-on rate for loan outstandings increased to 6.52% by the end of the fourth quarter.
    • Commercial originations were $489.6 million during the fourth quarter of 2022, compared to $340.4 million in the third quarter of 2022, and $408.9 million in the fourth quarter of 2021.
    • Consumer originations in the fourth quarter of 2022 were $74.6 million, compared to $128.6 million in the third quarter of 2022 and $72.6 million in the fourth quarter of 2021.
    • Residential loans originated for sale in the secondary market totaled $10.7 million in the fourth quarter of 2022, compared to $16.4 million in the third quarter of 2022 and $69.2 million in the fourth quarter of 2021.
    • Closed residential loans retained in the portfolio totaled $74.3 million in the fourth quarter of 2022, compared to $69.3 million in the third quarter of 2022, and $49.1 million in the fourth quarter of 2021.
  • Pipelines (loans in underwriting and approval or approved and not yet closed) totaled $453.6 million on December 31, 2022, a decrease of 29% from September 30, 2022 and a decrease of 6% from December 31, 2021. As higher interest rates begin to slow loan demand, we remain focused on generating disciplined growth in full relationships, including credit facilities, deposit relationships, and wealth opportunities.
    • Commercial pipelines were $395.7 million as of December 31, 2022, a decrease of 25% from $530.4 million at September 30, 2022, and a decrease of 1% from $397.8 million at December 31, 2021.
    • Consumer pipelines were $36.6 million as of December 31, 2022, a decrease of 16% from $43.7 million at September 30, 2022, and an increase of 23% from $29.7 million at December 31, 2021.
    • Residential saleable pipelines were $4.2 million as of December 31, 2022, compared to $6.6 million at September 30, 2022, and $30.1 million at December 31, 2021. Retained residential pipelines were $17.1 million as of December 31, 2022, compared to $60.7 million at September 30, 2022, and $25.6 million at December 31, 2021.
  • Total deposits were $10.0 billion as of December 31, 2022, an increase of $1.2 billion, or 14%, compared to September 30, 2022, and an increase of $1.9 billion, or 24%, compared to December 31, 2021. The increase in the fourth quarter of 2022 includes $1.7 billion in deposits from acquired banks. The Company has continued to manage deposit pricing lower than competitors, and with an average loan-to-deposit ratio of 78% during the quarter, has maintained balance sheet flexibility supporting expansion of the net interest margin. The rising rate environment contributed to deposit outflows in the fourth quarter of 2022, which partially resulted in migration to wealth management and increases in assets under management.
    • At December 31, 2022, the percentage of total transaction account balances to overall deposit funding was 64%, which continues to aid the Company’s ability to maintain a consistently low cost of deposits.
    • The overall cost of deposits increased 12 basis points from the prior quarter to 21 basis points.
  • Federal Home Loan Bank advances of $150.0 million with a weighted average rate of 3.42% were added late in the fourth quarter of 2022.
  • Subordinated debt increased with the acquisition of $12.3 million in notes acquired in the Apollo transaction. The notes carry a fixed interest rate of 5.50% until 2025, convert to a floating rate until maturity in 2030, and are callable at the Company’s discretion.

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 increased by $7.4 million to $28.8 million at December 31, 2022. Nonperforming loans to total loans outstanding were 0.35% at December 31, 2022, 0.32% at September 30, 2022, and 0.52% at December 31, 2021.
  • Nonperforming assets to total assets increased to 0.26% at December 31, 2022, compared to 0.23% at September 30, 2022, and 0.46% at December 31, 2021.
  • The ratio of allowance for credit losses to total loans was 1.40% at December 31, 2022, 1.42% at September 30, 2022, and 1.41% at December 31, 2021. The decline in the fourth quarter of 2022 represents the release of $2.1 million added in the third quarter of 2022 for potential losses related to Hurricane Ian that did not materialize.
  • Net charge-offs of $0.8 million for the fourth quarter of 2022 compared to $0.1 million in the third quarter of 2022 and $0.6 million in the fourth quarter of 2021. Net charge-offs for the four most recent quarters averaged 0.01%.
  • 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 commercial loan size is $621 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 45% and 228% of total bank-level risk-based capital, respectively, compared to 30% and 191% respectively, at September 30, 2022. On a consolidated basis, construction and land development and commercial real estate loans represent 41% and 210%, 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 December 31, 2022, of 15.1% compared to 16.5% at September 30, 2022, and 17.4% at December 31, 2021. The total capital ratio was 16.1% and the tier 1 leverage ratio was 11.5% at December 31, 2022.
  • Cash and cash equivalents at December 31, 2022 totaled $201.9 million, with decreases from the prior quarter resulting from loan growth and from lower deposit balances.
  • Tangible common equity to tangible assets was 9.08% at December 31, 2022, compared to 9.79% at September 30, 2022, and 11.09% at December 31, 2021. Declines in the value of available for sale securities due to rising interest rates in 2022 negatively impacted equity year to date by $181.1 million.
     
  • At December 31, 2022, the Company had available unsecured lines of credit of $175.0 million and lines of credit under lendable collateral value of $2.4 billion. Additionally, $2.0 billion of debt securities and $1.1 billion of residential and commercial real estate loans are available as collateral for potential borrowings.

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


FINANCIAL HIGHLIGHTS        
(Amounts in thousands except per share data)(Unaudited) 
 Quarterly Trends 
           
 4Q'22 3Q'22 2Q'22 1Q'22 4Q'21 
Selected balance sheet data:          
Total assets$12,145,762  $10,345,235  $10,811,704  $10,904,817  $9,681,433  
Gross loans 8,144,724   6,690,845   6,541,548   6,451,217   5,925,029  
Total deposits 9,981,595   8,765,414   9,188,953   9,243,768   8,067,589  
           
Performance measures:          
Net income$23,927  $29,237  $32,755  $20,588  $36,330  
Net interest margin 4.36%  3.67%  3.38%  3.25%  3.16% 
Pre-tax pre-provision earnings1 45,999   43,143   42,580   33,095   40,855  
Average diluted shares outstanding 71,374   61,961   61,923   61,704   59,016  
Diluted earnings per share (EPS)$0.34  $0.47  $0.53  $0.33  $0.62  
Return on (annualized):          
Average assets (ROA) 0.78%  1.10%  1.21%  0.79%  1.43% 
Average tangible assets (ROTA)2 0.94   1.17   1.29   0.85   1.51  
Average tangible common equity (ROTCE)2 10.36   11.53   13.01   8.02   14.29  
Tangible common equity to tangible assets2 9.08   9.79   9.74   9.89   11.09  
Tangible book value per share2$14.69  $15.98  $16.66  $17.12  $17.84  
Efficiency ratio 63.39%  57.13%  56.22%  62.33%  53.70% 
           
Adjusted operating measures1:          
Adjusted net income$39,926  $32,837  $36,327  $27,056  $36,854  
Adjusted pre-tax pre-provision earnings 66,649   48,989   46,397   41,737   42,258  
Adjusted diluted EPS 0.56   0.53   0.59   0.44   0.62  
Adjusted ROTA2 1.36%  1.27%  1.38%  1.06%  1.49% 
Adjusted ROTCE2 15.05   12.48   13.97   10.01   14.11  
Adjusted efficiency ratio 51.52   53.28   53.15   54.86   53.43  
Net adjusted noninterest expense as a percent of average tangible assets2 2.42   2.16   2.00   1.99   1.96  
           
Other data:          
Market capitalization3$2,233,761  $1,858,429  $2,028,996  $2,144,586  $2,070,465  
Full-time equivalent employees 1,490   1,156   1,095   1,066   989  
Number of ATMs 100   79   79   79   75  
Full-service banking offices 78   58   58   58   54  
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 January 27th at 10:00 a.m. Eastern Time, to discuss the fourth quarter and full year 2022 earnings results and business trends. Investors may call in (toll-free) by dialing (800) 763-5615. 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 $12.1 billion in assets and $10.0 billion in deposits as of December 31, 2022. Seacoast provides integrated financial services including commercial and consumer banking, wealth management, and mortgage services to customers at over 75 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.

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 Professional Holding Corp. and Professional Bank with and into Seacoast and Seacoast National Bank, respectively. The registration statement in connection with the merger includes a proxy statement of Professional Holding Corp. and a prospectus of Seacoast. 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 STATEMENT/PROSPECTUS AND ANY OTHER DOCUMENTS TO BE FILED WITH THE SEC IN CONNECTION WITH THE MERGERS OR INCORPORATED BY REFERENCE IN THE PROXY STATEMENT/PROSPECTUS BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION.

Investors may obtain these documents free of charge at the SEC’s website (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.

Professional Holding Corp. and Professional Bank, their directors, executive officers, other members of management, and employees may be considered participants in the solicitation of proxies in connection with the proposed mergers with and into Seacoast and Seacoast National Bank. Information regarding the participants in the proxy solicitation of Professional Holding Corp. and a description of its 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.

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 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 Apollo Bancshares, Inc. and Drummond Banking Company, or expects to acquire, including Professional Holding Corp. as well as statements with respect to Seacoast's objectives, strategic plans, expectations and intentions and other statements that are not historical facts, any of which may be impacted by the COVID-19 pandemic and any variants thereof and related effects on the U.S. economy. 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 to be materially different from future 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, elevated 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 (including the velocity of loan repayment) and credit risk as a result of the foregoing; 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; 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; the adverse impact of COVID-19 (economic and otherwise) on the Company and its customers, counterparties, employees, and third-party service providers, and the adverse impacts to our business, financial position, results of operations and prospects; government or regulatory responses to the COVID-19 pandemic; changes in accounting policies, rules and practices, including the impact of the adoption of the current expected credit losses (“CECL”) methodology; uncertainty related to the impact of LIBOR calculations on securities, loans and debt; 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; our 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 fall in stock market prices on our fee income from our brokerage and wealth management businesses; 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, including as a result of employees working remotely; 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, 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.

The risks relating to the merger with Professional Holding Corp. include, 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.

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, 2021 and quarterly reports on Form 10-Q for the quarters ended March 31, 2022, June 30, 2022, and September 30, 2022 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.

Contact:

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


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'223Q'222Q'221Q'224Q'214Q'224Q'21 
         
Summary of Earnings       
Net income$23,927 $29,237 $32,755 $20,588 $36,330 $106,507 $124,403  
Adjusted net income1 39,926  32,837  36,327  27,056  36,854  136,146  134,952  
Net interest income2 119,858  88,399  81,764  76,639  72,412  366,660  276,541  
Net interest margin2,3 4.36% 3.67% 3.38% 3.25% 3.16% 3.69% 3.27% 
Pre-tax pre-provision earnings1 45,999  43,143  42,580  33,095  40,855  164,817  149,833  
Adjusted pre-tax pre-provision earnings1 66,649  48,989  46,397  41,737  42,258  203,772  164,561  
         
Performance Ratios       
Return on average assets-GAAP basis3 0.78% 1.10% 1.21% 0.79% 1.43% 0.96% 1.33% 
Return on average tangible assets-GAAP basis3,4 0.94  1.17  1.29  0.85  1.51  1.06  1.41  
Adjusted return on average tangible assets1,3,4 1.36  1.27  1.38  1.06  1.49  1.27  1.48  
Pre-tax pre-provision return on average tangible assets1,3,4 1.69  1.71  1.66  1.34  1.7  1.61  1.69  
Adjusted pre-tax pre-provision return on average tangible assets1,3,4 2.28  1.89  1.77  1.64  1.71  1.91  1.81  
Net adjusted noninterest expense to average tangible assets1,3,4 2.42  2.16  2  1.99  1.96  2.15  2.01  
Return on average shareholders' equity-GAAP basis3 6.03  8.6  9.73  5.96  11.06  7.51  10.24  
Return on average tangible common equity-GAAP basis3,4 10.36  11.53  13.01  8.02  14.29  10.7  13.27  
Adjusted return on average tangible common equity1,3,4 15.05  12.48  13.97  10.01  14.11  12.86  13.97  
Efficiency ratio5 63.39  57.13  56.22  62.33  53.7  60.01  55.39  
Adjusted efficiency ratio1 51.52  53.28  53.15  54.86  53.43  53.03  52.59  
Noninterest income to total revenue (excluding securities gains/ losses) 12.84
  15.72  17.45  17.14  20.89  15.50  20.53  
Tangible common equity to tangible assets4 9.08  9.79  9.74  9.89  11.09  9.08  11.09  
Average loan-to-deposit ratio 77.67  73.9  70.6  71.25  70.29  73.5  73.61  
End of period loan-to-deposit ratio 81.63  76.35  71.34  70.01  73.84  81.63  73.84  
         
Per Share Data       
Net income diluted-GAAP basis 0.34  0.47  0.53  0.33  0.62  1.66  2.18  
Net income basic-GAAP basis 0.34  0.48  0.53  0.34  0.62  1.67  2.2  
Adjusted earnings1 0.56  0.53  0.59  0.44  0.62  2.12  2.36  
         
Book value per share common 22.45  20.95  21.65  22.15  22.4  22.45  22.4  
Tangible book value per share 14.69  15.98  16.66  17.12  17.84  14.69  17.84  
Cash dividends declared 0.17  0.17  0.17  0.13  0.13  0.64  0.39  
         

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
 Twelve Months Ended
 
(Amounts in thousands, except per share data)4Q'22 3Q'22 2Q'22 1Q'22 4Q'21 4Q'22 4Q'21 
Interest on securities: Taxable$18,530  $15,653  $ 12,387  $10,041  $8,574  $56,611  $29,206  
Nontaxable 130   138   138   140   139   546   577  
Fees on PPP loans 27   295   676   1,373   3,011   2,371   17,496  
Interest on PPP loans 12   25   65   150   341   252   3,787  
Interest and fees on loans - excluding PPP loans 105,283   73,650   68,566   65,595   61,049   313,094   230,188  
Interest on federal funds sold and other investments 3,127   1,643   1,917   933   828   7,620   2,990  
Total Interest Income 127,109   91,404   83,749   78,232   73,942   380,494   284,244  
Interest on deposits 3,934   1,623   994   767   711   7,318   3,605  
Interest on time certificates 1,358   380   436   468   494   2,642   2,788  
Interest on borrowed money 2,108   1,117   672   475   448   4,372   1,826  
Total Interest Expense 7,400   3,120   2,102   1,710   1,653   14,332   8,219  
Net Interest Income 119,709   88,284   81,647   76,522   72,289   366,162   276,025  
Provision for credit losses 14,129   4,676   822   6,556   (3,942)  26,183   (9,421) 
Net Interest Income After Provision for Credit Losses 105,580   83,608   80,825   69,966   76,231   339,979   285,446  
Noninterest income: Service charges on deposit accounts 3,996   3,504   3,408   2,801   2,606   13,709   9,777  
Interchange income 4,650   4,138   4,255   4,128   4,135   17,171   16,231  
Wealth management income 2,886   2,732   2,774   2,659   2,356   11,051   9,628  
Mortgage banking fees 426   434   932   1,686   2,030   3,478   11,782  
Marine finance fees 208   209   312   191   147   920   665  
SBA gains 105   108   473   156   200   842   1,531  
BOLI income 1,526   1,363   1,349   1,334   1,295   5,572   4,154  
Other 3,836   3,977   3,761   2,870   6,316   14,444   17,537  
  17,633   16,465   17,264   15,825   19,085   67,187   71,305  
Securities gains (losses), net 18   (362)  (300)  (452)  (379)  (1,096)  (578) 
Total Noninterest Income 17,651   16,103   16,964   15,373   18,706   66,091   70,727  
Noninterest expenses: Salaries and wages 45,405   28,420   28,056   28,219   25,005   130,100   97,283  
Employee benefits 5,300   4,074   4,151   5,501   4,763   19,026   17,873  
Outsourced data processing costs 9,918   5,393   6,043   6,156   5,165   27,510   19,919  
Telephone / data lines 1,185   973   908   733   790   3,799   3,223  
Occupancy 5,457   5,046   4,050   3,986   3,500   18,539   14,140  
Furniture and equipment 1,944   1,462   1,588   1,426   1,403   6,420   5,390  
Marketing 1,772   1,461   1,882   1,171   1,060   6,286   4,583  
Legal and professional fees 9,174   3,794   2,946   4,789   2,461   20,703   11,376  
FDIC assessments 889   760   699   789   713   3,137   2,405  
Amortization of intangibles 4,763   1,446   1,446   1,446   1,304   9,101   5,033  
Foreclosed property expense and net (gain) loss on sale (411)  9   (968)  (164)  (175)  (1,534)  (264) 
Provision for credit losses on unfunded commitments    1,015      142      1,157   133  
Other 6,114   7,506   5,347   4,723   4,274   23,690   16,341  
Total Noninterest Expense 91,510   61,359   56,148   58,917   50,263   267,934   197,435  
Income Before Income Taxes 31,721   38,352   41,641   26,422   44,674   138,136   158,738  
Income taxes 7,794   9,115   8,886   5,834   8,344   31,629   34,335  
Net Income$       23,927  $       29,237  $       32,755  $        20,588  $        36,330  $  106,507  $  124,403  
Per share of common stock:              
Net income diluted$           0.34  $           0.47  $           0.53  $           0.33  $           0.62  $           1.66  $          2.18  
Net income basic 0.34   0.48   0.53   0.34   0.62   1.67   2.20  
Cash dividends declared 0.17   0.17   0.17   0.13   0.13   0.64   0.39  
Average diluted shares outstanding 71,374   61,961   61,923   61,704   59,016   64,264   57,088  
Average basic shares outstanding 70,770   61,442   61,409   61,127   58,462   63,707   56,586  


CONDENSED CONSOLIDATED BALANCE SHEETS  (Unaudited)
SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES          

(Amounts in thousands)
December 31,
2022
 September 30,
2022
 June 30,
2022
 March 31,
2022
 December 31,
2021
 
Assets
Cash and due from banks
$120,748  $176,463  $363,343  $351,128  $238,750  
Interest bearing deposits with other banks81,192   42,152   538,025   871,387   498,979  
Total Cash and Cash Equivalents                                                   201,940   218,615   901,368   1,222,515   737,729  
Time deposits with other banks3,236   4,481   4,730   5,975     
Debt Securities:
Available for sale (at fair value)
1,871,742   1,860,734   1,800,791   1,706,619   1,644,319  
Held to maturity (at amortized cost)747,408   774,706   794,785   747,004   638,640  
Total Debt Securities                                                                    2,619,150   2,635,440   2,595,576   2,453,623   2,282,959  
Loans held for sale3,151   1,620   14,205   20,615   31,791  
Loans8,144,724   6,690,845   6,541,548   6,451,217   5,925,029  
Less: Allowance for credit losses (113,895)  (95,329)  (90,769)  (89,838)  (83,315) 
Net Loans                                                                                     8,030,829   6,595,516   6,450,779   6,361,379   5,841,714  
Bank premises and equipment, net116,892   81,648   74,784   74,617   72,404  
Other real estate owned2,301   2,419   2,419   11,567   13,618  
Goodwill480,319   286,606   286,606   286,606   252,154  
Other intangible assets, net75,451   18,583   20,062   21,549   14,845  
Bank owned life insurance237,824   209,087   207,724   206,375   205,041  
Net deferred tax assets94,457   83,139   60,080   47,222   27,321  
Other assets280,212   208,081   193,371   192,774   201,857  
Total Assets                                                                       $12,145,762  $10,345,235  $10,811,704  $10,904,817  $9,681,433  



Liabilities and Shareholders' Equity
Liabilities
Deposits

Noninterest demand$      4,070,973  $      3,529,489  $       3,593,201  $       3,522,700  $        3,075,534  
Interest-bearing demand 2,337,590   2,170,251   2,269,148   2,253,562   1,890,212  
Savings 1,064,392   938,081   946,738   937,839   895,019  
Money market 1,985,974   1,700,737   1,911,847   1,999,027   1,651,881  
Other time certificates 369,389   312,840   350,571   397,491   404,601  
Brokered time certificates 3,798              
Time certificates of more than $250,000 149,479   114,016   117,448   133,149   150,342  
Total Deposits 9,981,595   8,765,414   9,188,953   9,243,768   8,067,589  
Securities sold under agreements to repurchase 172,029   94,191   110,578   120,922   121,565  
Federal Home Loan Bank borrowings 150,000              
Subordinated debt 84,533   71,857   71,786   71,716   71,646  
Other liabilities 149,830   125,971   110,812   112,126   109,897  
Total Liabilities 10,537,987   9,057,433   9,482,129   9,548,532   8,370,697  
Shareholders' Equity
Common stock
 7,162   6,148   6,141   6,124   5,850  
Additional paid in capital 1,377,802   1,068,241   1,065,167   1,062,462   963,851  
Retained earnings 423,863   412,166   393,431   371,192   358,598  
Treasury stock (13,019)  (11,539)  (11,632)  (10,459)  (10,569) 
  1,795,808   1,475,016   1,453,107   1,429,319   1,317,730  
Accumulated other comprehensive (loss) income, net (188,033)  (187,214)  (123,532)  (73,034)  (6,994) 
Total Shareholders' Equity 1,607,775   1,287,802   1,329,575   1,356,285   1,310,736  
Total Liabilities & Shareholders' Equity$  12,145,762  $  10,345,235  $  10,811,704  $  10,904,817  $        9,681,433  
Common shares outstanding 71,618   61,476   61,410   61,239   58,504  



CONSOLIDATED QUARTERLY FINANCIAL DATA(Unaudited)
SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES         
          
(Amounts in thousands)4Q'22 3Q'22 2Q'22 1Q'22 4Q'21
Credit Analysis
Net charge-offs (recoveries) - non-acquired loans
$ 185  $129  $(75) $72  $541 
Net charge-offs (recoveries) - acquired loans 597   (26)  (49)  7   29 
Total Net Charge-offs (Recoveries)$     782  $103  $(124) $79  $570 
Net charge-offs (recoveries) to average loans - non-acquired loans 0.01 %  0.01 %  %  %  0.04%
Net charge-offs (recoveries) to average loans - acquired loans 0.03             
Total Net Charge-offs (Recoveries) to Average Loans  0.04   0.01         0.04 
Allowance for credit losses - non-acquired loans$     85,469  $82,980  $70,215  $67,261  $64,710 
Allowance for credit losses - acquired loans 28,426   12,349   20,554   22,577   18,605 
Total Allowance for Credit Losses$ 113,895  $95,329  $90,769  $89,838  $83,315 
Non-acquired loans at end of period$  5,942,720  $5,651,741  $5,389,405  $5,169,973  $4,860,171 
Acquired loans at end of period 2,197,414   1,033,810   1,134,940   1,241,988   973,751 
Paycheck Protection Program loans at end of period 4,590   5,294   17,203   39,256   91,107 
Total Loans$  8,144,724  $6,690,845  $6,541,548  $6,451,217  $5,925,029 
Non-acquired loans allowance for credit losses to non-acquired 1.44 %   1.47%  1.30%  1.30%  1.33%
Properties previously used in bank operations included in other real estate owned 1,771    2,310   2,310    2,310   1,395 


Total Nonperforming Assets$31,144  $23,883  $28,861  $37,775  $44,216 
Accruing troubled debt restructures (TDRs)$ 4,032  $4,149  $4,022  $4,454  $3,917 
Nonperforming Loans to Loans at End of Period 0.35 %  0.32%  0.40%  0.41%  0.52%
Nonperforming Assets to Total Assets at End of Period 0.26   0.23   0.27   0.35   0.46 
      
 December 31,September 30,June 30,March 31,December 31,
Loans20222022202220222021
Construction and land development$ 587,332  $361,913 $350,025  $259,421  $230,824 
Commercial real estate - owner occupied 1,478,302   1,253,459  1,254,343   1,284,515   1,197,774 
Commercial real estate - non-owner occupied 1 2,589,774   2,107,614  1,972,540   1,966,150   1,736,439 
Residential real estate 1 1,849,503   1,599,765  1,647,465   1,599,645   1,425,354 
Commercial and financial 1,348,636   1,182,384  1,124,771   1,132,506   1,069,356 
Consumer 286,587   180,416  175,201   169,724   174,175 
Paycheck Protection Program 4,590   5,294  17,203   39,256   91,107 
Total Loans$  8,144,724  $6,690,845 $6,541,548  $6,451,217  $5,925,029 

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     
          
          
          
 4Q'223Q'224Q'21
 Average Yield/Average Yield/Average Yield/
(Amounts in thousands)BalanceInterestRateBalanceInterestRateBalanceInterestRate
          
Assets         
Earning assets:         
Securities:         
Taxable$2,680,813 $18,530  2.76%$2,665,104 $15,6532.35%$2,198,517 $8,574  1.56%
Nontaxable 20,246  164  3.24  22,064  1743.15  24,664  176  2.85 
Total Securities 2,701,059  18,694  2.77  2,687,168  15,8272.36  2,223,181  8,750  1.57 
Federal funds sold 155,815  1,410  3.59  203,815  1,0622.07  878,875  337  0.15 
Interest bearing deposits with other banks 141,179  1,717  4.83  45,193  5815.1  34,991  491  5.56 
Loans excluding PPP loans 7,905,843  105,398  5.29  6,597,828  73,7304.43  5,804,149  61,135  4.18 
PPP loans 4,886  39  3.19  10,114  32012.54  136,942  3,352  9.71 
Total Loans 7,910,729  105,437  5.29  6,607,942  74,0504.45  5,941,091  64,487  4.31 
Total Earning Assets 10,908,782  127,258  4.63  9,544,118  91,5203.8  9,078,138  74,065  3.24 
          
Allowance for credit losses (109,509)       (91,348)     (88,484)    
Cash and due from banks 137,839        331,947      359,287     
Premises and equipment 115,095        76,357      72,148     
Intangible assets 521,412        305,935      267,692     
Bank owned life insurance 237,062        208,193      195,169     
Other assets including deferred tax assets 329,175        210,136      177,432     
                  
Total Assets$12,139,856       $10,585,338     $10,061,382     
          
Liabilities and Shareholders' Equity           
Interest-bearing liabilities:         
Interest-bearing demand$2,303,324 $1,859  0.32%$2,215,899 $7570.14
%$1,960,083 $183  0.04%
Savings 1,126,540  203  0.07  944,128  650.03  866,257  63  0.03 
Money market 1,980,870  1,872  0.37  1,806,014  8020.18  1,851,275  465  0.1 
Time deposits 500,441  1,358  1.08  445,840  3800.34  595,230  494  0.33 
Securities sold under agreements to repurchase 134,709  544  1.60  111,902  3091.10  106,691  30  0.11 
Federal Home Loan Bank borrowings 40,712  330  3.22           
Other borrowings 83,534  1,234  5.86  71,810  8084.46  71,600  418  2.32 
Total Interest-Bearing Liabilities 6,170,130  7,400  0.48  5,595,593  3,1210.22  5,451,136  1,653  0.12 
          
Noninterest demand 4,273,922        3,529,844    3,179,798       
Other liabilities 122,100        110,426      126,762       
Total Liabilities 10,566,152        9,235,863      8,757,696       
                    
Shareholders' equity 1,573,704        1,349,475      1,303,686       
                    
Total Liabilities & Equity$12,139,856       $10,585,338     $10,061,382       
                    
Cost of deposits       0.21%     0.09%       0.06%
Interest expense as a % of earning assets       0.27%     0.13%       0.07%
Net interest income as a % of earning assets   $119,858  4.36%    88,3993.67%   $72,412  3.16%
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, 2022Twelve Months Ended December 31, 2021
 Average Yield/Average Yield/
(Amounts in thousands, except ratios)BalanceInterestRateBalanceInterestRate
        
Assets       
Earning assets:       
Securities:       
Taxable$2,568,568 $56,611 2.20%$1,839,619 $29,2061.59%
Nontaxable 22,188  690 3.11  25,369  7302.88 
Total Securities 2,590,756  57,301 2.21  1,864,988  29,9361.61 
                
Federal funds sold 433,359  4,103 0.95  763,795  1,0430.14 
Interest bearing deposits with other banks and other investments 69,604  3,517 5.05  65,534  1,9472.97 
        
Loans excluding PPP loans 6,812,654  313,450 4.6  5,369,204  230,5524.29 
PPP loans 25,612  2,623 10.24  381,860  21,2825.57 
Total Loans 6,838,266  316,073 4.62  5,751,064  251,8344.38 
        
Total Earning Assets 9,931,985  380,994 3.84  8,445,381  284,7603.37 
                
Allowance for credit losses (94,693)      (88,659)    
Cash and due from banks 305,775       332,664     
Premises and equipment 85,568       71,771     
Intangible assets 360,217       249,089     
Bank owned life insurance 214,468       156,599     
Other assets including deferred tax assets 248,108       170,209     
                
Total Assets$11,051,428      $9,337,054     
        
Liabilities and Shareholders' Equity      
Interest-bearing liabilities:      
Interest-bearing demand$2,220,307 $3,099 0.14%$1,787,234 $8950.05%
Savings 989,997  397 0.04  805,816  3830.05 
Money market 1,925,176  3,824 0.2  1,765,444  2,3270.13 
Time deposits 500,471  2,642 0.53  602,739  2,7880.46 
Securities sold under agreements to repurchase 121,318  986 0.81  113,881  1410.12 
Federal Home Loan Bank borrowings 10,264  330 3.22     
Other borrowings 74,713  3,056 4.09  71,495  1,6852.36 
        
Total Interest-Bearing Liabilities 5,842,246  14,334 0.25  5,146,609  8,2190.16 
        
Noninterest demand 3,667,345      2,851,687    
Other liabilities 122,982      123,446    
Total Liabilities 9,632,573      8,121,742    
          
Shareholders' equity 1,418,855      1,215,312    
          
Total Liabilities & Equity$11,051,428     $9,337,054    
          
Cost of deposits 0.11%   0.11%    0.08%
Interest expense as a % of earning assets    0.14%    0.10%
Net interest income as a % of earning assets   $366,660 3.69%   $276,5413.27%
                
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)
December 31,
2022
September 30,
2022
June 30,
2022
March 31,
2022
December 31,
2021
Customer Relationship Funding Noninterest demand     
Commercial$       3,148,778 $2,827,591 $2,945,445 $2,939,595 $2,477,111
Retail 764,274  447,848  464,214  458,809  458,626
Public funds 112,553  210,662  143,075  86,419  107,523
Other 45,368  43,388  40,467  37,877  32,274
Total Noninterest Demand 4,070,973  3,529,489  3,593,201  3,522,700  3,075,534
Interest-bearing demand Commercial 886,894  759,286   769,948  610,109  497,466
Retail 1,191,192  1,199,112  1,207,698  1,392,490  1,144,635
Brokered 54,777  81,799      
Public funds 204,727  130,054  291,502  250,963  248,111
Total Interest-Bearing Demand 2,337,590  2,170,251  2,269,148  2,253,562  1,890,212
 Total transaction accounts Commercial 4,035,672  3,586,877  3,715,393  3,549,704  2,974,577
Retail 1,955,466  1,646,960  1,671,912  1,851,299  1,603,261
Brokered 54,777  81,799      
Public funds 317,280  340,716  434,577  337,382  355,634
Other 45,368  43,388  40,467  37,877  32,274
Total Transaction Accounts 6,408,563  5,699,740  5,862,349  5,776,262  4,965,746
Savings 1,064,392  938,081  946,738  937,839  895,019
Money market Commercial 932,518  788,009  819,452  856,117  732,639
Retail 984,561  857,914  914,918  931,702  840,054
Brokered     106,823  126,168  8,007
Public funds 68,895  54,814  70,654  85,040  71,181
Total Money Market 1,985,974  1,700,737  1,911,847  1,999,027  1,651,881
Brokered time certificates 3,798        
Other time certificates 518,868  426,856  468,019  530,640  554,943
522,666  426,856  468,019  530,640  554,943
Total Deposits $9,981,595 $8,765,414 $9,188,953 $9,243,768 $8,067,589
               
Customer sweep accounts$172,029 $94,191 $110,578 $120,922 $121,565


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'223Q'222Q'221Q'224Q'214Q'224Q'21
Net Income$     23,927 $     29,237 $     32,755 $     20,588 $     36,330 $ 106,507 $  124,403 
Total noninterest income 17,651  16,103  16,964  15,373  18,706  66,091  70,727 
Securities losses (gains), net (18) 362  300  452  379  1,096  578 
Gain on sale of domain name (included in other income)         (755)   (755)
Total Adjustments to Noninterest Income (18) 362  300  452  (376) 1,096  (177)
Total Adjusted Noninterest Income 17,633  16,465  17,264  15,825  18,330  67,187  70,550 
Total noninterest expense 91,510  61,359  56,148  58,917  50,263  267,934  197,435 
Merger related charges (16,140) (2,054) (3,039) (6,692) (482) (27,925) (7,853)
Amortization of intangibles (4,763) (1,446) (1,446) (1,446) (1,304) (9,101) (5,033)
Branch reductions and other expense initiatives (176) (960)   (74) (168) (1,210) (2,150)
Total Adjustments to Noninterest Expense (21,079) (4,460) (4,485) (8,212) (1,954) (38,236) (15,036)
Total Adjusted Noninterest Expense 70,431  56,899  51,663  50,705  48,309  229,698  182,399 
Income Taxes 7,794  9,115  8,886  5,834  8,344  31,629  34,335 
Tax effect of adjustments 5,338  1,222  1,213  2,196  280  9,969  3,536 
Tax expense on BOLI surrender (276)         (276)  
Effect of change in corporate tax rate on deferred tax assets         774    774 
Total Adjustments to Income Taxes 5,062  1,222  1,213  2,196  1,054  9,693  4,310 
Adjusted Income Taxes 12,856  10,337  10,099  8,030  9,398  41,322  38,645 
Adjusted Net Income$     39,926 $     32,837 $     36,327 $     27,056 $     36,854 $ 136,146 $  134,952 
Earnings per diluted share, as reported$        0.34 $         0.47 $         0.53 $         0.33 $         0.62 $        1.66 $         2.18 
Adjusted Earnings per Diluted Share 0.56  0.53  0.59  0.44  0.62  2.12  2.36 
Average diluted shares outstanding 71,374  61,961  61,923  61,704  59,016  64,264  57,088 
Adjusted Noninterest Expense$     70,431 $     56,899 $     51,663 $     50,705 $     48,309 $ 229,698 $  182,399 
Provision for credit losses on unfunded commitments   (1,015)   (142)   (1,157) (133)
Foreclosed property expense and net gain / (loss) on sale 411  (9) 968  164  175  1,534  264 
Net Adjusted Noninterest Expense$     70,842 $     55,875 $     52,631 $     50,727 $     48,484 $ 230,075 $  182,530 
Revenue$ 137,360 $  104,387 $     98,611 $     91,895 $     90,995 $ 432,253 $  346,752 
Total Adjustments to Revenue (18) 362  300  452  (376) 1,096  (177)
Impact of FTE adjustment 149  115  117  117  123  498  516 
Adjusted Revenue on a fully taxable equivalent basis$ 137,491 $  104,864 $     99,028 $     92,464 $     90,742 $ 433,847 $  347,091 
Adjusted Efficiency Ratio 51.52 % 53.28% 53.15% 54.86% 53.43% 53.03 % 52.59%
Net Interest Income$ 119,709 $     88,284 $     81,647 $     76,522 $     72,289 $ 366,162 $  276,025 
Impact of FTE adjustment 149  115  117  117  123  498  516 
Net Interest Income including FTE adjustment$ 119,858 $     88,399 $     81,764 $     76,639 $     72,412 $ 366,660 $  276,541 
Total noninterest income 17,651  16,103  16,964  15,373  18,706  66,091  70,727 
Total noninterest expense 91,510  61,359  56,148  58,917  50,263  267,934  197,435 
Pre-Tax Pre-Provision Earnings$     45,999 $     43,143 $     42,580 $     33,095 $     40,855 $ 164,817 $  149,833 
Total Adjustments to Noninterest Income (18) 362  300  452  (376) 1,096  (177)
Total Adjustments to Noninterest Expense (20,668) (5,484) (3,517) (8,190) (1,779) (37,859) (14,905)
Adjusted Pre-Tax Pre-Provision Earnings$     66,649 $     48,989 $     46,397 $     41,737 $     42,258 $ 203,772 $  164,561 
Average Assets$12,139,856 $10,585,338 $10,840,518 $10,628,516 $10,061,382 $11,051,428 $9,337,054 
Less average goodwill and intangible assets (521,412) (305,935) (307,411) (304,321) (267,692) (360,217) (249,089)
Average Tangible Assets$11,618,444 $10,279,403 $10,533,107 $10,324,195 $9,793,690 $10,691,211 $9,087,965 
Return on Average Assets (ROA) 0.78% 1.10% 1.21% 0.79% 1.43% 0.96% 1.33%
Impact of removing average intangible assets and related 0.16  0.07  0.08  0.06  0.08  0.10  0.08 
Return on Average Tangible Assets (ROTA) 0.94  1.17  1.29  0.85  1.51  1.06  1.41 


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'223Q'222Q'221Q'224Q'214Q'224Q'21
Impact of other adjustments for Adjusted Net Income 0.42  0.10  0.09  0.21  (0.02) 0.21  0.07 
Adjusted Return on Average Tangible Assets 1.36  1.27  1.38  1.06  1.49  1.27  1.48 
Pre-Tax Pre-Provision return on Average Tangible Assets 1.69 % 1.71% 1.66% 1.34% 1.70% 1.61 % 1.69%
Impact of adjustments on Pre-Tax Pre-Provision earnings 0.59  0.18  0.18  0.18  0.18  0.30  0.12 
Adjusted Pre-Tax Pre-Provision Return on Tangible Assets 2.28  1.89  1.77  1.64  1.71  1.91  1.81 
Average Shareholders' Equity$1,573,704 $1,349,475 $1,350,568 $1,400,535 $1,303,686 $1,418,855 $1,215,312 
Less average goodwill and intangible assets (521,412) (305,935) (307,411) (304,321) (267,692) (360,217) (249,089)
Average Tangible Equity$1,052,292 $1,043,540 $1,043,157 $1,096,214 $1,035,994 $1,058,638 $  966,223 
Return on Average Shareholders' Equity 6.03 %
 8.60% 9.73% 5.96% 11.06% 7.51% 10.24%
Impact of removing average intangible assets and related amortization 4.33  2.93  3.28  2.06  3.23  3.19  3.03 
Return on Average Tangible Common Equity (ROTCE)
 10.36  11.53  13.01  8.02  14.29  10.70  13.27 
Impact of other adjustments for Adjusted Net Income 4.69  0.95  0.96  1.99  (0.18) 2.16  0.70 
Adjusted Return on Average Tangible Common Equity
 15.05  12.48  13.97  10.01  14.11  12.86  13.97 


Loan interest income1$ 105,437 $     74,050 $     69,388 $     67,198 $     64,487 $ 316,073 $  251,834 
Accretion on acquired loans (9,710) (2,242) (2,720) (3,717) (3,520) (18,389) (12,757)
Interest and fees on PPP loans (39) (320) (741) (1,523) (3,352) (2,623) (21,282)
Loan interest income excluding PPP and accretion on acquired loans$95,688 $71,488 $65,927 $61,958 $57,615 $295,061 $217,795 
Yield on loans1 5.29  4.45  4.29  4.30  4.31  4.62  4.38 
Impact of accretion on acquired loans (0.49) (0.14) (0.16) (0.24) (0.24) (0.27) (0.22)
Impact of PPP loans   (0.01) (0.03) (0.06) (0.13) (0.02) (0.10)


Yield on loans excluding PPP and accretion on acquired loans 4.80% 4.30% 4.10% 4.00% 3.94% 4.33% 4.06%
Net Interest Income1$ 119,858 $88,399 $81,764 $76,639 $72,412 $ 366,660 $276,541 
Accretion on acquired loans (9,710) (2,242) (2,720) (3,717) (3,520) (18,389) (12,757)
Interest and fees on PPP loans (39) (320) (741) (1,523) (3,352) (2,623) (21,282)
Net interest income excluding PPP and accretion on acquired loans$110,109 $85,837 $78,303 $71,399 $65,540 $345,648 $242,502 
Net Interest Margin 4.36  3.67  3.38  3.25  3.16  3.69  3.27 
Impact of accretion on acquired loans (0.35) (0.09) (0.12) (0.15) (0.15) (0.18) (0.15)
Impact of PPP loans   (0.01) (0.02) (0.05) (0.10) (0.02) (0.11)


Net interest margin excluding PPP and accretion on acquired loans 4.01% 3.57% 3.24% 3.05% 2.91% 3.49% 3.01%
Security interest income1$     18,694 $15,827 $12,562 $10,218 $8,750 $     57,301 $29,936 
Tax equivalent adjustment on securities (34) (35) (36) (37) (37) (142) (153)
Security interest income excluding tax equivalent adjustment$18,660 $15,792 $12,526 $10,181 $8,713 $57,159 $29,783 
Loan interest income1$ 105,437 $74,050 $69,388 $ 67,198 $ 64,487 $ 316,073 $ 251,834 
Tax equivalent adjustment on loans (115) (80) (81) (80) (86) (356) (363)
Loan interest income excluding tax equivalent adjustment$105,322 $73,970 $69,307 $67,118 $64,401 $315,717 $251,471 
Net Interest Income1$ 119,858 $88,399 $ 81,764 $ 76,639 $ 72,412 $ 366,660 $ 276,541 
Tax equivalent adjustment on securities (34) (35) (36) (37) (37) (142) (153)
Tax equivalent adjustment on loans (115) (80) (81) (80) (86) (356) (363)
Net interest income excluding tax equivalent adjustment$119,709 $88,284 $81,647 $76,522 $72,289 $366,162 $276,025 
                

1On a fully taxable equivalent basis. All yields and rates have been computed using amortized cost.