SouthState (SSB) Q1 2025 earnings summary

Executive summary

• Completed the acquisition of Independent Bank Group in January 2025, expanding scale and market presence, and executed a major sale-leaseback and securities portfolio restructuring, resulting in a significant balance sheet reset.

• Net interest margin rose to 3.85%, with adjusted return on assets at 1.38% and adjusted return on tangible common equity near 20%.

• Reported Q1 2025 diluted EPS of $0.87 and adjusted diluted EPS of $2.15, reflecting significant one-time items from acquisition and restructuring.

• Pre-provision net revenue per share grew 25% year-over-year.

• Declared a quarterly dividend of $0.54 per share, payable May 16, 2025.

Financial highlights

• Net interest income for Q1 2025 was $544.5 million, with net interest margin (TE) of 3.85%, up from 3.48% in Q4 2024.

• Noninterest income totaled $86 million, including a $229 million gain on sale-leaseback and a $229 million net loss from securities restructuring.

• Noninterest expense rose to $408.8 million, mainly from $66.5 million in merger costs and higher salaries, occupancy, and amortization.

• Provision for credit losses was $100.6 million, including $92.1 million related to acquired loans and commitments.

• Efficiency ratio was 61%, with adjusted efficiency ratio improving to 50%.

Outlook and guidance

• Net interest margin expected to remain stable between 3.80% and 3.90% for the rest of 2025, drifting higher into 2026 as assets reprice.

• Management expects further cost savings and business synergies from the Independent acquisition, with integration and systems conversion costs continuing through 2025.

• Loan growth anticipated to continue, focusing on commercial and consumer owner-occupied segments.

• Noninterest expense guidance: $350–$360 million for Q2 and Q3, dropping to $345–$350 million in Q4 as more cost saves are realized.

• Noninterest income expected to remain flat until loan volume and capital markets activity pick up.