SouthState Bank (SSB) Q3 2024 earnings summary

Executive summary

• Reported GAAP net income of $143.2 million and diluted EPS of $1.86 for Q3 2024, with adjusted net income of $145.7 million and adjusted EPS of $1.90; up 15.3% year-over-year.

• Achieved broad-based growth in loans, deposits, revenue, and EPS despite hurricane season impacts and maintained business continuity.

• Tangible book value per share increased 7% sequentially to $51.26.

• Announced and received shareholder approval for the merger with Independent Bank Group, expected to close in Q1 2025, creating the largest regional bank in the South.

• Business continuity was maintained during widespread power outages, and employee support was provided through the Sunshine Fund.

Financial highlights

• Net interest income for Q3 2024 was $351.5 million; net interest margin (tax equivalent) was 3.40%, with total loan yield at 5.86% and deposit cost at 1.90%.

• Loans grew by $314 million (4% annualized), led by single-family residential and C&I segments; deposits grew by $540 million (6% annualized).

• Noninterest income was $75 million, representing 0.65% of average assets and 18% of total revenue.

• Noninterest expense rose to $246.8 million, mainly from higher salaries, merger costs, and information services.

• Efficiency ratio was 57%, with adjusted efficiency ratio at 56%.

Outlook and guidance

• The merger with Independent Bank Group is expected to close in Q1 2025, with anticipated EPS accretion of 16.5–27.3% in 2025 and strong capital ratios post-merger.

• NIM expected to expand by 4-5 bps in Q4, with further improvement anticipated in 2025, especially post-merger.

• Non-interest expense for Q4 expected in the $245–$250 million range.

• Mid-single-digit loan growth guidance maintained for 2024, with potential acceleration as the yield curve normalizes.

• Management expects continued organic loan growth and stable asset quality, with focus on integrating the pending acquisition.