SouthState Corporation Reports Third Quarter 2024 Results, Declares Quarterly Cash Dividend

WINTER HAVEN, Fla., Oct. 23, 2024 /PRNewswire/ -- SouthState Corporation (NYSE: SSB) today released its unaudited results of operations and other financial information for the three-month and nine-month periods ended September 30, 2024.

SouthState Corporation Reports Third Quarter 2024 Results

"Despite the challenges of hurricane season, SouthState produced steady growth in loans, deposits, revenue, and earnings per share. Furthermore, with the compounding effect of interest rate changes, our tangible book value per share increased 7% during the quarter", commented John C. Corbett, SouthState's Chief Executive Officer. "We were also pleased to receive overwhelming shareholder support for our acquisition of IBTX. We look forward to joining with Independent Financial and building shareholder value in the best growth markets in the country."

Highlights of the third quarter of 2024 include:

Returns

Reported Diluted Earnings per Share ("EPS") of $1.86; Adjusted Diluted EPS (Non-GAAP) of $1.90
Net Income of $143.2 million; Adjusted Net Income (Non-GAAP) of $145.7 million
Return on Average Common Equity of 9.9%; Return on Average Tangible Common Equity (Non-GAAP) of 15.6% and Adjusted Return on Average Tangible Common Equity (Non-GAAP) of 15.9%*
Return on Average Assets ("ROAA") of 1.25% and Adjusted ROAA (Non-GAAP) of 1.27%*
Book Value per Share of $77.42; Tangible Book Value ("TBV") per Share (Non-GAAP) of $51.26

Performance

Net Interest Income of $351 million; Core Net Interest Income (excluding loan accretion) (Non-GAAP) of $349 million
Net Interest Margin ("NIM"), non-tax equivalent of 3.39% and tax equivalent (Non-GAAP) of 3.40%
Net charge-offs of $6.1 million, or 0.07% annualized; ($7.0) million release of Provision for Credit Losses ("PCL"), including a release for unfunded commitments of $8.7 million; total allowance for credit losses ("ACL") plus reserve for unfunded commitments of 1.52%
Noninterest Income of $75 million; Noninterest Income represented 0.65% of average assets for the third quarter of 2024*
Efficiency Ratio of 57% and Adjusted Efficiency Ratio (Non-GAAP) of 56%

^∗ Annualized percentages

Balance Sheet

Loans increased $314 million, or 4% annualized, led by increases in consumer real estate and commercial and industrial; ending loan to deposit ratio of 89%
Deposits increased $540 million, or 6% annualized
Total loan yield of 5.86%, up 0.04% from prior quarter
Total deposit cost of 1.90%, up 0.10% from prior quarter
Strong capital position with Tangible Common Equity, Total Risk-Based Capital, Tier 1 Leverage, and Tier 1 Common Equity ratios of 8.9%, 14.9%, 10.0%, and 12.5%, respectively^†

^† Preliminary

Mergers & Acquisitions

Received approval by each of SouthState's and Independent Bank Group, Inc.'s respective shareholders; still subject to other customary conditions, including regulatory approval

Subsequent Events

The Board of Directors of the Company declared a quarterly cash dividend on its common stock of $0.54 per share, payable on November 15, 2024 to shareholders of record as of November 8, 2024

Financial Performance


	Three Months Ended										Nine Months Ended
(Dollars in thousands, except per share data)	Sep. 30,		Jun. 30,		Mar. 31,		Dec. 31,		Sep. 30,		Sep. 30,		Sep. 30,
INCOME STATEMENT	2024		2024		2024		2023		2023		2024		2023
Interest Income
Loans, including fees (1)	$	494,082	$	478,360	$	463,688	$	459,880	$	443,805	$	1,436,130	$	1,256,525
Investment securities, trading securities, federal funds sold and securities
purchased under agreements to resell		50,096		52,764		53,567		55,555		56,704		156,427		172,446
Total interest income		544,178		531,124		517,255		515,435		500,509		1,592,557		1,428,971
Interest Expense
Deposits		177,919		165,481		160,162		149,584		133,944		503,562		290,673
Federal funds purchased, securities sold under agreements
to repurchase, and other borrowings		14,779		15,384		13,157		11,620		11,194		43,320		39,921
Total interest expense		192,698		180,865		173,319		161,204		145,138		546,882		330,594
Net Interest Income		351,480		350,259		343,936		354,231		355,371		1,045,675		1,098,377
(Recovery) provision for credit losses		(6,971)		3,889		12,686		9,893		32,709		9,604		104,189
Net Interest Income after (Recovery) Provision for Credit Losses		358,451		346,370		331,250		344,338		322,662		1,036,071		994,188
Noninterest Income		74,934		75,225		71,558		65,489		72,848		221,717		221,417
Noninterest Expense
Operating expense		243,543		242,343		240,923		245,774		238,042		726,809		709,953
Merger, branch consolidation, severance related and other expense (8)		3,304		5,785		4,513		1,778		164		13,602		11,384
FDIC special assessment		—		619		3,854		25,691		—		4,473		—
Total noninterest expense		246,847		248,747		249,290		273,243		238,206		744,884		721,337
Income before Income Tax Provision		186,538		172,848		153,518		136,584		157,304		512,904		494,268
Income tax provision		43,359		40,478		38,462		29,793		33,160		122,299		106,751
Net Income	$	143,179	$	132,370	$	115,056	$	106,791	$	124,144	$	390,605	$	387,517

Adjusted Net Income (non-GAAP) (2)
Net Income (GAAP)	$	143,179	$	132,370	$	115,056	$	106,791	$	124,144	$	390,605	$	387,517
Securities losses (gains), net of tax		—		—		—		2		—		—		(35)
Merger, branch consolidation, severance related and other expense, net of tax (8)		2,536		4,430		3,382		1,391		130		10,348		8,900
FDIC special assessment, net of tax		—		474		2,888		20,087		—		3,362		—
Adjusted Net Income (non-GAAP)	$	145,715	$	137,274	$	121,326	$	128,271	$	124,274	$	404,315	$	396,382

Basic earnings per common share	$	1.88	$	1.74	$	1.51	$	1.40	$	1.63	$	5.12	$	5.10
Diluted earnings per common share	$	1.86	$	1.73	$	1.50	$	1.39	$	1.62	$	5.09	$	5.07
Adjusted net income per common share - Basic (non-GAAP) (2)	$	1.91	$	1.80	$	1.59	$	1.69	$	1.63	$	5.30	$	5.21
Adjusted net income per common share - Diluted (non-GAAP) (2)	$	1.90	$	1.79	$	1.58	$	1.67	$	1.62	$	5.27	$	5.19
Dividends per common share	$	0.54	$	0.52	$	0.52	$	0.52	$	0.52	$	1.58	$	1.52
Basic weighted-average common shares outstanding		76,299,069		76,251,401		76,301,411		76,100,187		76,139,170		76,284,016		76,034,062
Diluted weighted-average common shares outstanding		76,805,436		76,607,281		76,660,081		76,634,100		76,571,430		76,690,900		76,445,649
Effective tax rate		23.24 %		23.42 %		25.05 %		21.81 %		21.08 %		23.84 %		21.60 %

Performance and Capital Ratios


	Three Months Ended															Nine Months Ended
	Sep. 30,			Jun. 30,			Mar. 31,			Dec. 31,			Sep. 30,			Sep. 30,		Sep. 30,
	2024			2024			2024			2023			2023			2024		2023
PERFORMANCE RATIOS
Return on average assets (annualized)		1.25	%		1.17	%		1.03	%		0.94	%		1.10	%	1.15	%	1.16	%
Adjusted return on average assets (annualized) (non-GAAP) (2)		1.27	%		1.22	%		1.08	%		1.13	%		1.10	%	1.19	%	1.19	%
Return on average common equity (annualized)		9.91	%		9.58	%		8.36	%		7.99	%		9.24	%	9.29	%	9.83	%
Adjusted return on average common equity (annualized) (non-GAAP) (2)		10.08	%		9.94	%		8.81	%		9.60	%		9.25	%	9.62	%	10.06	%
Return on average tangible common equity (annualized) (non-GAAP) (3)		15.63	%		15.49	%		13.63	%		13.53	%		15.52	%	14.94	%	16.67	%
Adjusted return on average tangible common equity (annualized) (non-GAAP) (2) (3)		15.89	%		16.05	%		14.35	%		16.12	%		15.54	%	15.44	%	17.03	%
Efficiency ratio (tax equivalent)		56.58	%		57.03	%		58.48	%		63.43	%		54.00	%	57.35	%	52.98	%
Adjusted efficiency ratio (non-GAAP) (4)		55.80	%		55.52	%		56.47	%		56.89	%		53.96	%	55.93	%	52.11	%
Dividend payout ratio (5)		28.76	%		29.93	%		34.42	%		37.01	%		31.84	%	30.82	%	29.78	%
Book value per common share	$	77.42		$	74.16		$	72.82		$	72.78		$	68.81
Tangible book value per common share (non-GAAP) (3)	$	51.26		$	47.90		$	46.48		$	46.32		$	42.26

CAPITAL RATIOS
Equity-to-assets		12.8	%		12.4	%		12.3	%		12.3	%		11.6	%
Tangible equity-to-tangible assets (non-GAAP) (3)		8.9	%		8.4	%		8.2	%		8.2	%		7.5	%
Tier 1 leverage (6)		10.0	%		9.7	%		9.6	%		9.4	%		9.3	%
Tier 1 common equity (6)		12.5	%		12.1	%		11.9	%		11.8	%		11.5	%
Tier 1 risk-based capital (6)		12.5	%		12.1	%		11.9	%		11.8	%		11.5	%
Total risk-based capital (6)		14.9	%		14.4	%		14.4	%		14.1	%		13.8	%

Balance Sheet


	Ending Balance
(Dollars in thousands, except per share and share data)	Sep. 30,		Jun. 30,		Mar. 31,		Dec. 31,		Sep. 30,
BALANCE SHEET	2024		2024		2024		2023		2023
Assets
Cash and due from banks	$	563,887	$	507,425	$	478,271	$	510,922	$	514,917
Federal funds sold and interest-earning deposits with banks		648,792		609,741		731,186		487,955		814,220
Cash and cash equivalents		1,212,679		1,117,166		1,209,457		998,877		1,329,137

Trading securities, at fair value		87,103		92,161		66,188		31,321		114,154
Investment securities:
Securities held to maturity		2,301,307		2,348,528		2,446,589		2,487,440		2,533,713
Securities available for sale, at fair value		4,564,363		4,498,264		4,598,400		4,784,388		4,623,618
Other investments		211,458		201,516		187,285		192,043		187,152
Total investment securities		7,077,128		7,048,308		7,232,274		7,463,871		7,344,483
Loans held for sale		287,043		100,007		56,553		50,888		27,443
Loans:
Purchased credit deteriorated		913,342		957,255		1,031,283		1,108,813		1,171,543
Purchased non-credit deteriorated		3,959,028		4,253,323		4,534,583		4,796,913		5,064,254
Non-acquired		28,675,822		28,023,986		27,101,444		26,482,763		25,780,875
Less allowance for credit losses		(467,981)		(472,298)		(469,654)		(456,573)		(447,956)
Loans, net		33,080,211		32,762,266		32,197,656		31,931,916		31,568,716
Premises and equipment, net		507,452		517,382		512,635		519,197		516,583
Bank owned life insurance		1,007,275		1,001,998		997,562		991,454		984,881
Mortgage servicing rights		83,512		88,904		87,970		85,164		89,476
Core deposit and other intangibles		71,835		77,389		83,193		88,776		95,094
Goodwill		1,923,106		1,923,106		1,923,106		1,923,106		1,923,106
Other assets		745,303		765,283		778,244		817,454		996,055
Total assets	$	46,082,647	$	45,493,970	$	45,144,838	$	44,902,024	$	44,989,128

Liabilities and Shareholders' Equity
Deposits:
Noninterest-bearing	$	10,376,531	$	10,374,464	$	10,546,410	$	10,649,274	$	11,158,431
Interest-bearing		27,261,664		26,723,938		26,632,024		26,399,635		25,776,767
Total deposits		37,638,195		37,098,402		37,178,434		37,048,909		36,935,198
Federal funds purchased and securities
sold under agreements to repurchase		538,322		542,403		554,691		489,185		513,304
Other borrowings		691,626		691,719		391,812		491,904		391,997
Reserve for unfunded commitments		41,515		50,248		53,229		56,303		62,347
Other liabilities		1,268,409		1,460,795		1,419,663		1,282,625		1,855,295
Total liabilities		40,178,067		39,843,567		39,597,829		39,368,926		39,758,141

Shareholders' equity:
Common stock - $2.50 par value; authorized 160,000,000 shares		190,674		190,489		190,443		190,055		190,043
Surplus		4,249,672		4,238,192		4,230,345		4,240,413		4,238,753
Retained earnings		1,943,874		1,841,933		1,749,215		1,685,166		1,618,080
Accumulated other comprehensive loss		(479,640)		(620,211)		(622,994)		(582,536)		(815,889)
Total shareholders' equity		5,904,580		5,650,403		5,547,009		5,533,098		5,230,987
Total liabilities and shareholders' equity	$	46,082,647	$	45,493,970	$	45,144,838	$	44,902,024	$	44,989,128

Common shares issued and outstanding		76,269,577		76,195,723		76,177,163		76,022,039		76,017,366

Net Interest Income and Margin


	Three Months Ended
	Sep. 30, 2024					Jun. 30, 2024					Sep. 30, 2023
(Dollars in thousands)	Average		Income/		Yield/	Average		Income/		Yield/	Average		Income/		Yield/
YIELD ANALYSIS	Balance		Expense		Rate	Balance		Expense		Rate	Balance		Expense		Rate
Interest-Earning Assets:
Federal funds sold and interest-earning deposits with banks	$	559,942	$	6,462	4.59 %	$	732,252	$	8,248	4.53 %	$	822,805	$	10,831	5.22 %
Investment securities		7,163,934		43,634	2.42 %		7,226,582		44,516	2.48 %		7,714,079		45,873	2.36 %
Loans held for sale		112,429		2,694	9.53 %		63,307		1,018	6.47 %		34,736		517	5.90 %
Total loans held for investment		33,387,675		491,388	5.86 %		32,989,521		477,342	5.82 %		31,804,760		443,288	5.53 %
Total interest-earning assets		41,223,980		544,178	5.25 %		41,011,662		531,124	5.21 %		40,376,380		500,509	4.92 %
Noninterest-earning assets		4,373,250					4,416,072					4,464,939
Total Assets	$	45,597,230				$	45,427,734				$	44,841,319

Interest-Bearing Liabilities ("IBL"):
Transaction and money market accounts	$	19,936,966	$	129,613	2.59 %	$	19,653,436	$	120,722	2.47 %	$	18,291,300	$	93,465	2.03 %
Savings deposits		2,453,886		1,893	0.31 %		2,504,809		1,830	0.29 %		2,845,250		1,919	0.27 %
Certificates and other time deposits		4,489,441		46,413	4.11 %		4,286,950		42,929	4.03 %		4,413,855		38,560	3.47 %
Federal funds purchased		304,582		4,178	5.46 %		270,028		3,621	5.39 %		236,732		3,128	5.24 %
Repurchase agreements		258,166		1,519	2.34 %		270,815		1,362	2.02 %		303,339		1,163	1.52 %
Other borrowings		611,247		9,082	5.91 %		715,401		10,401	5.85 %		456,187		6,903	6.00 %
Total interest-bearing liabilities		28,054,288		192,698	2.73 %		27,701,439		180,865	2.63 %		26,546,663		145,138	2.17 %
Noninterest-bearing deposits		10,412,512					10,566,529					11,362,233
Other noninterest-bearing liabilities		1,382,260					1,605,296					1,603,511
Shareholders' equity		5,748,170					5,554,470					5,328,912
Total Non-IBL and shareholders' equity		17,542,942					17,726,295					18,294,656
Total Liabilities and Shareholders' Equity	$	45,597,230				$	45,427,734				$	44,841,319
Net Interest Income and Margin (Non-Tax Equivalent)			$	351,480	3.39 %			$	350,259	3.43 %			$	355,371	3.49 %
Net Interest Margin (Tax Equivalent) (non-GAAP)					3.40 %					3.44 %					3.50 %
Total Deposit Cost (without Debt and Other Borrowings)					1.90 %					1.80 %					1.44 %
Overall Cost of Funds (including Demand Deposits)					1.99 %					1.90 %					1.52 %

Total Accretion on Acquired Loans (1)			$	2,858				$	4,386				$	4,053
Tax Equivalent ("TE") Adjustment			$	486				$	631				$	646

• The remaining loan discount on acquired loans to be accreted into loan interest income totals $39.8 million as of September 30, 2024.

Noninterest Income and Expense


	Three Months Ended										Nine Months Ended
	Sep. 30,		Jun. 30,		Mar. 31,		Dec. 31,		Sep. 30,		Sep. 30,		Sep. 30,
(Dollars in thousands)	2024		2024		2024		2023		2023		2024		2023
Noninterest Income:
Fees on deposit accounts	$	33,986	$	33,842	$	33,145	$	33,225	$	32,830	$	100,973	$	95,790
Mortgage banking income		3,189		5,912		6,169		2,191		2,478		15,270		11,164
Trust and investment services income		11,578		11,091		10,391		10,131		9,556		33,060		29,316
Securities (losses) gains, net		—		—		—		(2)		—		—		45
Correspondent banking and capital markets income		17,381		16,267		14,591		16,081		24,808		48,239		74,498
Expense on centrally-cleared variation margin		(7,488)		(11,407)		(10,280)		(12,677)		(11,892)		(29,175)		(28,801)
Total correspondent banking and capital markets income		9,893		4,860		4,311		3,404		12,916		19,064		45,697
Bank owned life insurance income		8,276		7,372		6,892		6,567		7,039		22,540		20,123
Other		8,012		12,148		10,650		9,973		8,029		30,810		19,282
Total Noninterest Income	$	74,934	$	75,225	$	71,558	$	65,489	$	72,848	$	221,717	$	221,417

Noninterest Expense:
Salaries and employee benefits	$	150,865	$	151,435	$	150,453	$	145,850	$	146,146	$	452,753	$	437,548
Occupancy expense		22,242		22,453		22,577		22,715		22,251		67,272		65,980
Information services expense		23,280		23,144		22,353		22,000		21,428		68,777		62,472
OREO and loan related expense		1,358		1,307		606		948		613		3,271		768
Business development and staff related		5,797		6,220		5,799		7,492		5,995		17,816		18,624
Amortization of intangibles		5,327		5,744		5,998		6,615		6,616		17,069		20,943
Professional fees		4,017		3,906		3,115		7,025		3,456		11,038		11,522
Supplies and printing expense		2,762		2,526		2,540		2,761		2,623		7,828		7,817
FDIC assessment and other regulatory charges		7,482		7,771		8,534		8,325		8,632		23,787		24,745
Advertising and marketing		2,296		2,594		1,984		2,826		3,009		6,874		6,648
Other operating expenses		18,117		15,243		16,964		19,217		17,273		50,324		52,886
Merger, branch consolidation, severance related and other expense (8)		3,304		5,785		4,513		1,778		164		13,602		11,384
FDIC special assessment		—		619		3,854		25,691		—		4,473		—
Total Noninterest Expense	$	246,847	$	248,747	$	249,290	$	273,243	$	238,206	$	744,884	$	721,337

Loans and Deposits

The following table presents a summary of the loan portfolio by type:


	Ending Balance
(Dollars in thousands)	Sep. 30,		Jun. 30,		Mar. 31,		Dec. 31,		Sep. 30,
LOAN PORTFOLIO (7)	2024		2024		2024		2023		2023
Construction and land development * †	$	2,458,151	$	2,592,307	$	2,437,343	$	2,923,514	$	2,776,241
Investor commercial real estate*		9,856,709		9,731,773		9,752,529		9,227,968		9,372,683
Commercial owner occupied real estate		5,544,716		5,522,978		5,511,855		5,497,671		5,539,097
Commercial and industrial		5,931,187		5,769,838		5,544,131		5,504,539		5,458,229
Consumer real estate *		8,649,714		8,440,724		8,223,066		7,993,450		7,608,145
Consumer/other		1,107,715		1,176,944		1,198,386		1,241,347		1,262,277
Total Loans	$	33,548,192	$	33,234,564	$	32,667,310	$	32,388,489	$	32,016,672


*	Single family home construction-to-permanent loans originated by the Company's mortgage banking division are included in construction and land development category until completion. Investor commercial real estate loans include commercial non-owner occupied real estate and other income producing property. Consumer real estate includes consumer owner occupied real estate and home equity loans.
†	Includes single family home construction-to-permanent loans of $429.8 million, $544.2 million, $623.9 million, $715.5 million, and $863.1 million for the quarters ended September 30, 2024, June 30, 2024, March 31, 2024, December 31, 2023, and September 30, 2023, respectively.


	Ending Balance
(Dollars in thousands)	Sep. 30,		Jun. 30,		Mar. 31,		Dec. 31,		Sep. 30,
DEPOSITS	2024		2024		2024		2023		2023
Noninterest-bearing checking	$	10,376,531	$	10,374,464	$	10,546,410	$	10,649,274	$	11,158,431
Interest-bearing checking		7,550,392		7,547,406		7,898,835		7,978,799		7,806,243
Savings		2,442,584		2,475,130		2,557,203		2,632,212		2,760,166
Money market		12,614,046		12,122,336		11,895,385		11,538,671		10,756,431
Time deposits		4,654,642		4,579,066		4,280,601		4,249,953		4,453,927
Total Deposits	$	37,638,195	$	37,098,402	$	37,178,434	$	37,048,909	$	36,935,198

Core Deposits (excludes Time Deposits)	$	32,983,553	$	32,519,336	$	32,897,833	$	32,798,956	$	32,481,271

Asset Quality


	Ending Balance
	Sep. 30,		Jun. 30,		Mar. 31,		Dec. 31,		Sep. 30,
(Dollars in thousands)	2024		2024		2024		2023		2023
NONPERFORMING ASSETS:
Non-acquired
Non-acquired nonaccrual loans and restructured loans on nonaccrual	$	111,240	$	110,774	$	106,189	$	110,467	$	105,856
Accruing loans past due 90 days or more		6,890		5,843		2,497		11,305		783
Non-acquired OREO and other nonperforming assets		1,217		2,876		1,589		711		449
Total non-acquired nonperforming assets		119,347		119,493		110,275		122,483		107,088
Acquired
Acquired nonaccrual loans and restructured loans on nonaccrual		70,731		78,287		63,451		59,755		57,464
Accruing loans past due 90 days or more		389		916		135		1,174		1,821
Acquired OREO and other nonperforming assets		493		598		655		712		378
Total acquired nonperforming assets		71,613		79,801		64,241		61,641		59,663
Total nonperforming assets	$	190,960	$	199,294	$	174,516	$	184,124	$	166,751


	Three Months Ended
	Sep. 30,		Jun. 30,		Mar. 31,		Dec. 31,		Sep. 30,
	2024		2024		2024		2023		2023
ASSET QUALITY RATIOS (7):
Allowance for credit losses as a percentage of loans		1.39 %		1.42 %		1.44 %		1.41 %		1.40 %
Allowance for credit losses, including reserve for unfunded commitments, as a percentage of loans		1.52 %		1.57 %		1.60 %		1.58 %		1.59 %
Allowance for credit losses as a percentage of nonperforming loans		247.28 %		241.19 %		272.62 %		249.90 %		269.98 %
Net charge-offs as a percentage of average loans (annualized)		0.07 %		0.05 %		0.03 %		0.09 %		0.16 %
Total nonperforming assets as a percentage of total assets		0.41 %		0.44 %		0.39 %		0.41 %		0.37 %
Nonperforming loans as a percentage of period end loans		0.56 %		0.59 %		0.53 %		0.56 %		0.52 %

Current Expected Credit Losses ("CECL")

Below is a table showing the roll forward of the ACL and UFC for the third quarter of 2024:

Allowance for Credit Losses ("ACL and UFC")

(Dollars in thousands)

NonPCD ACL

PCD ACL

Total ACL

UFC

Ending balance 6/30/2024

447,628

24,670

472,298

50,248

Charge offs

(7,529)

—

(7,529)

—

Acquired charge offs

(188)

(886)

(1,074)

—

Recoveries

1,373

—

1,373

—

Acquired recoveries

775

375

1,150

—

Provision (recovery) for credit losses

2,563

(800)

1,763

(8,733)

Ending balance 9/30/2024

444,622

23,359

467,981

41,515

Period end loans

32,634,850

913,342

33,548,192

N/A

Allowance for Credit Losses to Loans

1.36 %

2.56 %

1.39 %

N/A

Unfunded commitments (off balance sheet) *

7,758,645

Reserve to unfunded commitments (off balance sheet)

0.54 %

* Unfunded commitments exclude unconditionally cancelable commitments and letters of credit.

Conference Call

The Company will host a conference call to discuss its third quarter results at 9:00 a.m. Eastern Time on October 24, 2024. Callers wishing to participate may call toll-free by dialing (888) 350-3899 within the US and (646) 960-0343 for all other locations. The numbers for international participants are listed at https://events.q4irportal.com/custom/access/2324/. The conference ID number is 4200408. Alternatively, individuals may listen to the live webcast of the presentation by visiting SouthStateBank.com. An audio replay of the live webcast is expected to be available by the evening of October 24, 2024 on the Investor Relations section of SouthStateBank.com.

SouthState Corporation is a financial services company headquartered in Winter Haven, Florida. SouthState Bank, N.A., the Company's nationally chartered bank subsidiary, provides consumer, commercial, mortgage and wealth management solutions to more than one million customers throughout Florida, Alabama, Georgia, the Carolinas and Virginia. The Bank also serves clients coast to coast through its correspondent banking division. Additional information is available at SouthStateBank.com.

Non-GAAP Measures

Statements included in this press release include non-GAAP measures and should be read along with the accompanying tables that provide a reconciliation of non-GAAP measures to GAAP measures. Although other companies may use calculation methods that differ from those used by SouthState for non-GAAP measures, management believes that these non-GAAP measures provide additional useful information, which allows readers to evaluate the ongoing performance of the Company. Non-GAAP measures should not be considered as an alternative to any measure of performance or financial condition as promulgated under GAAP, and investors should consider the Company's performance and financial condition as reported under GAAP and all other relevant information when assessing the performance or financial condition of the Company. Non-GAAP measures have limitations as analytical tools, and investors should not consider them in isolation or as a substitute for analysis of the Company's results or financial condition as reported under GAAP.


(Dollars and shares in thousands, except per share data)	Three Months Ended
PRE-PROVISION NET REVENUE ("PPNR") (NON-GAAP)	Sep. 30, 2024			Jun. 30, 2024			Mar. 31, 2024			Dec. 31, 2023			Sep. 30, 2023
Net income (GAAP)	$	143,179		$	132,370		$	115,056		$	106,791		$	124,144
(Recovery) provision for credit losses		(6,971)			3,889			12,686			9,893			32,709
Tax provision		43,359			40,478			38,462			29,793			33,160
Merger, branch consolidation, severance related and other expense (8)		3,304			5,785			4,513			1,778			164
FDIC special assessment		—			619			3,854			25,691			—
Securities losses		—			—			—			2			—
Pre-provision net revenue (PPNR) (Non-GAAP)	$	182,871		$	183,141		$	174,571		$	173,948		$	190,177

(Dollars in thousands)	Three Months Ended
CORE NET INTEREST INCOME (NON-GAAP)	Sep. 30, 2024			Jun. 30, 2024			Mar. 31, 2024			Dec. 31, 2023			Sep. 30, 2023
Net interest income (GAAP)	$	351,480		$	350,259		$	343,936		$	354,231		$	355,371
Less:
Total accretion on acquired loans		2,858			4,386			4,287			3,870			4,053
Core net interest income (Non-GAAP)	$	348,622		$	345,873		$	339,649		$	350,361		$	351,318

NET INTEREST MARGIN ("NIM"), TE (NON-GAAP)
Net interest income (GAAP)	$	351,480		$	350,259		$	343,936		$	354,231		$	355,371
Total average interest-earning assets		41,223,980			41,011,662			40,657,176			40,465,377			40,376,380
NIM, non-tax equivalent		3.39	%		3.43	%		3.40	%		3.47	%		3.49	%

Tax equivalent adjustment (included in NIM, TE)		486			631			528			659			646
Net interest income, tax equivalent (Non-GAAP)	$	351,966		$	350,890		$	344,464		$	354,890		$	356,017
NIM, TE (Non-GAAP)		3.40	%		3.44	%		3.41	%		3.48	%		3.50	%


	Three Months Ended															Nine Months Ended
(Dollars in thousands, except per share data)	Sep. 30,			Jun. 30,			Mar. 31,			Dec. 31,			Sep. 30,			Sep. 30,			Sep. 30,
RECONCILIATION OF GAAP TO NON-GAAP	2024			2024			2024			2023			2023			2024			2023
Adjusted Net Income (non-GAAP) (2)
Net income (GAAP)	$	143,179		$	132,370		$	115,056		$	106,791		$	124,144		$	390,605		$	387,517
Securities losses (gains), net of tax		—			—			—			2			—			—			(35)
Merger, branch consolidation, severance related and other expense, net of tax (8)		2,536			4,430			3,382			1,391			130			10,348			8,900
FDIC special assessment, net of tax		—			474			2,888			20,087			—			3,362			—
Adjusted net income (non-GAAP)	$	145,715		$	137,274		$	121,326		$	128,271		$	124,274		$	404,315		$	396,382

Adjusted Net Income per Common Share - Basic (2)
Earnings per common share - Basic (GAAP)	$	1.88		$	1.74		$	1.51		$	1.40		$	1.63		$	5.12		$	5.10
Effect to adjust for securities losses (gains), net of tax		—			—			—			0.00			—			—			(0.00)
Effect to adjust for merger, branch consolidation, severance related and other expense, net of tax (8)		0.03			0.05			0.04			0.03			0.00			0.14			0.11
Effect to adjust for FDIC special assessment, net of tax		—			0.01			0.04			0.26			—			0.04			—
Adjusted net income per common share - Basic (non-GAAP)	$	1.91		$	1.80		$	1.59		$	1.69		$	1.63		$	5.30		$	5.21

Adjusted Net Income per Common Share - Diluted (2)
Earnings per common share - Diluted (GAAP)	$	1.86		$	1.73		$	1.50		$	1.39		$	1.62		$	5.09		$	5.07
Effect to adjust for securities losses (gains), net of tax		—			—			—			0.00			—			—			(0.00)
Effect to adjust for merger, branch consolidation, severance related and other expense, net of tax (8)		0.04			0.05			0.04			0.02			0.00			0.14			0.12
Effect to adjust for FDIC special assessment, net of tax		—			0.01			0.04			0.26			—			0.04			—
Adjusted net income per common share - Diluted (non-GAAP)	$	1.90		$	1.79		$	1.58		$	1.67		$	1.62		$	5.27		$	5.19

Adjusted Return on Average Assets (2)
Return on average assets (GAAP)		1.25	%		1.17	%		1.03	%		0.94	%		1.10	%		1.15	%		1.16	%
Effect to adjust for securities losses (gains), net of tax		—	%		—	%		—	%		0.00	%		—	%		—	%		(0.00)	%
Effect to adjust for merger, branch consolidation, severance related and other expense, net of tax (8)		0.02	%		0.05	%		0.02	%		0.01	%		—	%		0.03	%		0.03	%
Effect to adjust for FDIC special assessment, net of tax		—	%		0.00	%		0.03	%		0.18	%		—	%		0.01	%		—	%
Adjusted return on average assets (non-GAAP)		1.27	%		1.22	%		1.08	%		1.13	%		1.10	%		1.19	%		1.19	%

Adjusted Return on Average Common Equity (2)
Return on average common equity (GAAP)		9.91	%		9.58	%		8.36	%		7.99	%		9.24	%		9.29	%		9.83	%
Effect to adjust for securities losses (gains), net of tax		—	%		—	%		—	%		0.00	%		—	%		—	%		(0.00)	%
Effect to adjust for merger, branch consolidation, severance related and other expense, net of tax (8)		0.17	%		0.33	%		0.24	%		0.11	%		0.01	%		0.25	%		0.23	%
Effect to adjust for FDIC special assessment, net of tax		—	%		0.03	%		0.21	%		1.50	%		—	%		0.08	%		—	%
Adjusted return on average common equity (non-GAAP)		10.08	%		9.94	%		8.81	%		9.60	%		9.25	%		9.62	%		10.06	%

Return on Average Common Tangible Equity (3)
Return on average common equity (GAAP)		9.91	%		9.58	%		8.36	%		7.99	%		9.24	%		9.29	%		9.83	%
Effect to adjust for intangible assets		5.72	%		5.91	%		5.27	%		5.54	%		6.28	%		5.65	%		6.84	%
Return on average tangible equity (non-GAAP)		15.63	%		15.49	%		13.63	%		13.53	%		15.52	%		14.94	%		16.67	%

Adjusted Return on Average Common Tangible Equity (2) (3)
Return on average common equity (GAAP)		9.91	%		9.58	%		8.36	%		7.99	%		9.24	%		9.29	%		9.83	%
Effect to adjust for securities losses (gains), net of tax		—	%		—	%		—	%		0.00	%		—	%		—	%		(0.00)	%
Effect to adjust for merger, branch consolidation, severance related and other expense, net of tax (8)		0.18	%		0.32	%		0.25	%		0.10	%		0.01	%		0.25	%		0.23	%
Effect to adjust for FDIC special assessment, net of tax		—	%		0.03	%		0.21	%		1.50	%		—	%		0.08	%		—	%
Effect to adjust for intangible assets, net of tax		5.80	%		6.12	%		5.53	%		6.53	%		6.29	%		5.82	%		6.97	%
Adjusted return on average common tangible equity (non-GAAP)		15.89	%		16.05	%		14.35	%		16.12	%		15.54	%		15.44	%		17.03	%

Adjusted Efficiency Ratio (4)
Efficiency ratio		56.58	%		57.03	%		58.48	%		63.43	%		54.00	%		57.35	%		52.98	%
Effect to adjust for merger, branch consolidation, severance related and other expense (8)		(0.78)	%		(1.36)	%		(1.08)	%		(0.43)	%		(0.04)	%		(1.07)	%		(0.87)	%
Effect to adjust for FDIC special assessment		—	%		(0.15)	%		(0.93)	%		(6.11)	%		—	%		(0.35)	%		—	%
Adjusted efficiency ratio		55.80	%		55.52	%		56.47	%		56.89	%		53.96	%		55.93	%		52.11	%

Tangible Book Value Per Common Share (3)
Book value per common share (GAAP)	$	77.42		$	74.16		$	72.82		$	72.78		$	68.81
Effect to adjust for intangible assets		(26.16)			(26.26)			(26.34)			(26.46)			(26.55)
Tangible book value per common share (non-GAAP)	$	51.26		$	47.90		$	46.48		$	46.32		$	42.26

Tangible Equity-to-Tangible Assets (3)
Equity-to-assets (GAAP)		12.81	%		12.42	%		12.29	%		12.32	%		11.63	%
Effect to adjust for intangible assets		(3.94)	%		(4.03)	%		(4.08)	%		(4.11)	%		(4.15)	%
Tangible equity-to-tangible assets (non-GAAP)		8.87	%		8.39	%		8.21	%		8.21	%		7.48	%


Footnotes to tables:

(1)	Includes loan accretion (interest) income related to the discount on acquired loans of $2.9 million, $4.4 million, $4.3 million, $3.9 million, and $4.1 million during the quarters ended September 30, 2024, June 30, 2024, March 31, 2024, December 31, 2023, and September 30, 2023, respectively, and $11.5 million and $16.9 million during the nine months ended September 30, 2024 and 2023, respectively.
(2)	Adjusted earnings, adjusted return on average assets, adjusted EPS, and adjusted return on average equity are non-GAAP measures and exclude the gains or losses on sales of securities, merger, branch consolidation, severance related and other expense, and FDIC special assessments. Management believes that non-GAAP adjusted measures provide additional useful information that allows readers to evaluate the ongoing performance of the Company. Non-GAAP measures should not be considered as an alternative to any measure of performance or financial condition as promulgated under GAAP, and investors should consider the Company's performance and financial condition as reported under GAAP and all other relevant information when assessing the performance or financial condition of the Company. Non-GAAP measures have limitations as analytical tools, and investors should not consider them in isolation or as a substitute for analysis of the Company's results or financial condition as reported under GAAP. Adjusted earnings and the related adjusted return measures (non-GAAP) exclude the following from net income (GAAP) on an after-tax basis: (a) pre-tax merger, branch consolidation, severance related and other expense of $3.3 million, $5.8 million, $4.5 million, $1.8 million, and $164,000 for the quarters ended September 30, 2024, June 30, 2024, March 31, 2024, December 31, 2023, and September 30, 2023, respectively, and $13.6 million and $11.4 million for the nine months ended September 30, 2024 and 2023, respectively; (b) pre-tax net securities losses of $(2,000) for the quarters ended December 31, 2023 and pre-tax net gains of $45,000 for the nine months ended September 30, 2023; and (c) pre-tax FDIC special assessment of $619,000, $3.9 million, and $25.7 million for the quarters ended June 30, 2024, March 31, 2024 and December 31, 2023, respectively, and $4.5 million for the nine months ended September 30, 2024.
(3)	The tangible measures are non-GAAP measures and exclude the effect of period end or average balance of intangible assets. The tangible returns on equity and common equity measures also add back the after-tax amortization of intangibles to GAAP basis net income. Management believes that these non-GAAP tangible measures provide additional useful information, particularly since these measures are widely used by industry analysts for companies with prior merger and acquisition activities. Non-GAAP measures should not be considered as an alternative to any measure of performance or financial condition as promulgated under GAAP, and investors should consider the Company's performance and financial condition as reported under GAAP and all other relevant information when assessing the performance or financial condition of the Company. Non-GAAP measures have limitations as analytical tools, and investors should not consider them in isolation or as a substitute for analysis of the Company's results or financial condition as reported under GAAP. The sections titled "Reconciliation of GAAP to Non-GAAP" provide tables that reconcile GAAP measures to non-GAAP.
(4)	Adjusted efficiency ratio is calculated by taking the noninterest expense excluding merger, branch consolidation, severance related and other expense, FDIC special assessment and amortization of intangible assets, divided by net interest income and noninterest income excluding securities gains (losses). The pre-tax amortization expenses of intangible assets were $5.3 million, $5.7 million, $6.0 million, $6.6 million, and $6.6 million for the quarters ended September 30, 2024, June 30, 2024, March 31, 2024, December 31, 2023, and September 30, 2023, respectively, and $17.1 million and $20.9 million for the nine months ended September 30, 2024 and 2023, respectively.
(5)	The dividend payout ratio is calculated by dividing total dividends paid during the period by the total net income for the same period.
(6)	September 30, 2024 ratios are estimated and may be subject to change pending the final filing of the FR Y-9C; all other periods are presented as filed.
(7)	Loan data excludes mortgage loans held for sale.
(8)	Includes pre-tax cyber incident costs of $56,000, $3.5 million and $4.4 million for the quarters ended, September 30, 2024, June 30, 2024, and March 31, 2024, respectively, and $8.0 million for the nine months ended September 30, 2024.

Cautionary Statement Regarding Forward Looking Statements

This communication contains "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995 that are subject to risks and uncertainties and are made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and other related federal securities laws. Forward-looking statements by their nature address matters that are, to different degrees, uncertain, including information about Independent Bank Group, Inc.'s ("IBTX"), SouthState Corporation's ("SouthState") or the combined company's possible or assumed future results of operations, including its future revenues, income, expenses, provision for taxes, effective tax rate, earnings (loss) per share and cash flows, its future capital expenditures and dividends, its future financial condition and changes therein, including changes in IBTX's, SouthState's or the combined company's loan portfolio and allowance for credit losses, IBTX's, SouthState's or the combined company's future capital structure or changes therein, the plan and objectives of management for future operations, IBTX's, SouthState's or the combined company's future or proposed acquisitions, the future or expected effect of acquisitions on IBTX's, SouthState's or the combined company's operations, results of operations and financial condition, IBTX's, SouthState's or the combined company's future economic performance and the statements of the assumptions underlying any such statement. Such statements are typically, but not exclusively, identified by the use in the statements of words or phrases such as "aim," "anticipate," "estimate," "expect," "goal," "guidance," "intend," "is anticipated," "is estimated," "is expected," "is intended," "objective," "plan," "projected," "projection," "will affect," "will be," "will continue," "will decrease," "will grow," "will impact," "will increase," "will incur," "will reduce," "will remain," "will result," "would be," variations of such words or phrases (including where the word "could," "may" or "would" is used rather than the word "will" in a phrase) and similar words and phrases indicating that the statement addresses some future result, occurrence, plan or objective. The forward-looking statements that IBTX and SouthState make are based on their current plans, estimates, expectations, ambitions and assumptions regarding IBTX's, SouthState's and the combined company's business, the economy and other future conditions.

Because forward-looking statements relate to future results and occurrences, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are beyond the control of IBTX and SouthState. IBTX's, SouthState's and the combined company's actual results may differ materially from those contemplated by the forward-looking statements, which are neither statements of historical fact nor guarantees or assurances of future performance. Many possible events or factors could affect IBTX's, SouthState's and the combined company's future financial results and performance and could cause those results or performance to differ materially from those expressed in the forward-looking statements. In addition to factors previously disclosed in IBTX's and SouthState's reports filed with the U.S. Securities and Exchange Commission (the "SEC"), the following factors, among others, could cause actual results to differ materially from forward-looking statements or historical performance: (1) the occurrence of any event, change or other circumstance that could give rise to the right of one or both of the parties to terminate the definitive merger agreement between IBTX and SouthState providing for the acquisition of IBTX by SouthState (the "Transaction"); (2) the outcome of any legal proceedings that may be instituted against IBTX or SouthState; (3) the possibility that the Transaction does not close when expected or at all because required regulatory, shareholder or other approvals and other conditions to closing are not received or satisfied on a timely basis or at all (and the risk that such approvals may result in the imposition of conditions that could adversely affect the combined company or the expected benefits of the Transaction); (4) the risk that the benefits from the Transaction may not be fully realized or may take longer to realize than expected, including as a result of changes in, or problems arising from, general economic and market conditions, interest and exchange rates, monetary policy, laws and regulations and their enforcement, and the degree of competition in the geographic and business areas in which IBTX and SouthState operate; (5) disruption to the parties' businesses as a result of the announcement and pendency of the Transaction; (6) the risk that the integration of each party's operations will be materially delayed or will be more costly or difficult than expected or that the parties are otherwise unable to successfully integrate each party's businesses into the other's businesses; (7) the possibility that the Transaction may be more expensive to complete than anticipated, including as a result of unexpected factors or events; (8) reputational risk and potential adverse reactions of IBTX's or SouthState's customers, suppliers, employees or other business partners, including those resulting from the announcement or completion of the Transaction; (9) the dilution caused by SouthState's issuance of additional shares of its capital stock in connection with the Transaction; (10) a material adverse change in the financial condition of SouthState or IBTX; (11) general competitive, economic, political and market conditions; (12) major catastrophes such as hurricanes, earthquakes, floods or other natural or human disasters, including infectious disease outbreaks; (13) the diversion of management's attention and time from ongoing business operations and opportunities on merger-related matters; and (14) other factors that may affect future results of IBTX and SouthState including changes in asset quality and credit risk, the inability to sustain revenue and earnings growth, changes in interest rates and capital markets, inflation, customer borrowing, repayment, investment and deposit practices, the impact, extent and timing of technological changes, capital management activities and other actions of the Federal Reserve Board and legislative and regulatory actions and reforms.

These factors are not necessarily all of the factors that could cause IBTX's, SouthState's or the combined company's actual results, performance or achievements to differ materially from those expressed in or implied by any of the forward-looking statements. Other factors, including unknown or unpredictable factors, also could harm IBTX's, SouthState's or the combined company's results.

IBTX and SouthState urge you to consider all of these risks, uncertainties and other factors carefully in evaluating all such forward-looking statements made by IBTX and/or SouthState. As a result of these and other matters, including changes in facts, assumptions not being realized or other factors, the actual results relating to the subject matter of any forward-looking statement may differ materially from the anticipated results expressed or implied in that forward-looking statement. Any forward-looking statement made in this communication or made by IBTX or SouthState in any report, filing, document or information incorporated by reference in this communication, speaks only as of the date on which it is made. IBTX and SouthState undertake no obligation to update any such forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law. A forward-looking statement may include a statement of the assumptions or bases underlying the forward-looking statement. IBTX and SouthState believe that these assumptions or bases have been chosen in good faith and that they are reasonable. However, IBTX and SouthState caution you that assumptions as to future occurrences or results almost always vary from actual future occurrences or results, and the differences between assumptions and actual occurrences and results can be material. Therefore, IBTX and SouthState caution you not to place undue reliance on the forward-looking statements contained in this filing or incorporated by reference herein.

If IBTX or SouthState update one or more forward-looking statements, no inference should be drawn that IBTX or SouthState will make additional updates with respect to those or other forward-looking statements. Further information regarding IBTX, SouthState and factors which could affect the forward-looking statements contained herein can be found in IBTX's Annual Report on Form 10-K for the fiscal year ended December 31, 2023 (which is available at https://www.sec.gov/ix?doc=/Archives/edgar/data/1564618/000156461824000025/ibtx-20231231.htm), and its other filings with the SEC, and in SouthState's Annual Report on Form 10-K for the fiscal year ended December 31, 2023 (which is available at https://www.sec.gov/ix?doc=/Archives/edgar/data/764038/000155837024002302/ssb-20231231x10k.htm), and its other filings with the SEC.

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