CoastalSouth Bancshares (COSO) investor relations material

Executive summary

• Net income for Q1 2026 was $6.3 million ($0.51 per diluted share), up from $5.1 million in Q1 2025, driven by higher net interest income and loan growth.

• Total assets reached $2.35 billion and total deposits $2.06 billion as of Q1 2026, reflecting 1.8% and 3.5% growth, respectively, with a strong Southeast presence and diversified business lines.

• Diluted EPS was $0.51, with book value per share at $21.94 and tangible book value per share up 12.3% year-over-year.

• Continued organic growth, highlighted by 9.78% annualized loan growth and 31.65% annualized core deposit growth quarter-over-quarter, supported by new commercial bankers.

• Paid first quarterly dividend in February 2026 and declared a $0.05 dividend for Q2 2026.

Financial highlights

• Net interest income was $19.7 million, up 17.8% year-over-year, with net interest margin stable at 3.59%.

• Noninterest income totaled $2.0 million, with gains from government guaranteed loan sales and mortgage banking offsetting lower other noninterest income.

• Noninterest expense rose 14.2% year-over-year and 6.4% sequentially, mainly due to higher salaries, occupancy, and technology costs.

• Provision for credit losses decreased 39.3% to $382 thousand, reflecting improved credit quality.

• Efficiency ratio increased to 60.1% in Q1 2026, up from Q4 2025, driven by higher salaries and professional fees.

Outlook and guidance

• Management expects continued loan growth and stable asset quality, supported by strong core deposit inflows and ongoing banker recruitment.

• The company remains asset sensitive and anticipates net interest income to benefit from rising rates, though competitive deposit pricing and a flat yield curve may pressure margins.

• Regulatory capital ratios remain strong, supporting further balance sheet expansion.