Seacoast Reports Third Quarter 2023 Results

Well-Positioned Balance Sheet with Strong Capital and Liquidity

Organic Deposit Growth Highlights Third Quarter Results

Robust Capital Position Builds Quarter over Quarter

STUART, Fla., Oct. 26, 2023 (GLOBE NEWSWIRE) — Seacoast Banking Corporation of Florida (“Seacoast” or the “Company”) (NASDAQ: SBCF) today reported net income in the third quarter of 2023 of $31.4 million, or $0.37 per diluted share, compared to $31.2 million, or $0.37 per diluted share in the second quarter of 2023 and $29.2 million, or $0.47 per diluted share in the third quarter of 2022. For the nine months ended September 30, 2023, net income was $74.5 million, or $0.89 per diluted share, a decrease of 10% compared to the nine months ended September 30, 2022.

Adjusted net income¹ for the third quarter of 2023 was $39.7 million, or $0.46 per diluted share, compared to $49.2 million, or $0.58 per diluted share in the second quarter of 2023 and $32.8 million, or $0.53 per diluted share in the third quarter of 2022. Adjusted net income¹ for the nine months ended September 30, 2023 was $118.2 million, or $1.41 per diluted share, an increase of 23% compared to the nine months ended September 30, 2022.

Pre-tax pre-provision earnings¹ were $43.4 million in the third quarter of 2023, an increase of 6% compared to the second quarter of 2023 and an increase of 1% compared to the third quarter of 2022. Pre-tax pre-provision earnings¹ for the nine months ended September 30, 2023 were $130.6 million, an increase of $11.7 million, or 10%, when compared to the nine months ended September 30, 2022. Adjusted pre-tax pre-provision earnings¹ were $54.8 million in the third quarter of 2023, a decrease of 15% compared to the second quarter of 2023 and an increase of 12% compared to the third quarter of 2022. Adjusted pre-tax pre-provision earnings¹ for the nine months ended September 30, 2023 were $190.7 million, an increase of $53.6 million, or 39%, when compared to the nine months ended September 30, 2022.

For the third quarter of 2023, return on average tangible assets was 1.04% and return on average tangible shareholders’ equity was 11.90%, compared to 1.06% and 12.08%, respectively, in the prior quarter, and 1.17% and 11.53%, respectively, in the prior year quarter. Adjusted return on average tangible assets¹ in the third quarter of 2023 was 1.12% and adjusted return on average tangible shareholders’ equity¹ was 12.79%, compared to 1.41% and 16.08%, respectively, in the prior quarter, and 1.27% and 12.48%, respectively, in the prior year quarter. For the nine months ended September 30, 2023, return on average tangible assets was 0.88% and return on average tangible shareholders’ equity was 10.09%, compared to 1.11% and 10.82%, respectively, for the nine months ended September 30, 2022. For the nine months ended September 30, 2023, adjusted return on average tangible assets¹ was 1.15% and adjusted return on average tangible shareholders’ equity¹ was 13.14%, compared to 1.24% and 12.13%, respectively, for the nine months ended September 30, 2022.

Charles M. Shaffer, Seacoast’s Chairman and CEO said, “Seacoast continues to benefit from the strong deposit franchise, disciplined credit, and conservative balance sheet principles that have served us well over our 96-year history. Following a period of elevated acquisition activity and consistent with our relationship-driven approach, we concentrated during the quarter on organically generated deposit growth, using the funding to pay down brokered time deposits and wholesale borrowings while benefiting from the increase in our market share, to 15^th from 18^th, in the nation’s fastest-growing state.”

Shaffer added, “We continue to maintain strong credit quality, with non-performing loans declining from the prior quarter. Our balance sheet remains robust, with a Tier 1 capital ratio of 13.9% as of September 30, 2023, and the ratio of tangible common equity to tangible assets of 8.68%. Even if all held-to-maturity securities were adjusted to fair value, our tangible common equity to tangible assets ratio would be a very strong 7.89%. Our liquidity position is also strong with a loan-to-deposit ratio of 83%, providing balance sheet flexibility as we move forward.”

Shaffer concluded, “Given the backdrop of an inverted yield curve and slowing economic conditions, we are managing overhead carefully and completed our previously announced reduction in force late in the third quarter. We will continue to position the Company prudently and manage overhead appropriately for the current operating environment.”

Financial Results

Income Statement

• Net income was $31.4 million, or $0.37 per diluted share, for the third quarter of 2023 compared to net income of $31.2 million, or $0.37 per diluted share, for the prior quarter, and $29.2 million, or $0.47 per diluted share, for the prior year quarter. For the nine months ended September 30, 2023, net income was $74.5 million, or $0.89 per diluted share, compared to $82.6 million, or $1.33 per diluted share, for the nine months ended September 30, 2022. The results for the nine months ended September 30, 2023 included the $26.6 million day-1 provision for credit losses on loans acquired in the Professional Bank acquisition. Adjusted net income¹ for the third quarter of 2023 was $39.7 million, or $0.46 per diluted share, compared to $49.2 million, or $0.58 per diluted share, for the prior quarter, and $32.8 million, or $0.53 per diluted share, for the prior year quarter. For the nine months ended September 30, 2023, adjusted net income¹ was $118.2 million, or $1.41 per diluted share, compared to $96.2 million, or $1.56 per diluted share, for the nine months ended September 30, 2022.
• Net revenues were $137.1 million in the third quarter of 2023, a decrease of $11.4 million, or 8%, compared to the prior quarter, and an increase of $32.7 million, or 31%, compared to the prior year quarter. For the nine months ended September 30, 2023, net revenues were $439.2 million, an increase of $144.3 million, or 49%, compared to the nine months ended September 30, 2022. Adjusted revenues¹ were $137.5 million in the third quarter of 2023, a decrease of $11.2 million, or 8%, compared to the prior quarter, and an increase of $32.7 million, or 31%, compared to the prior year quarter. For the nine months ended September 30, 2023, adjusted revenues¹ were $437.6 million, an increase of $141.6 million, or 48%, compared to the nine months ended September 30, 2022.
• Pre-tax pre-provision earnings¹ were $43.4 million in the third quarter of 2023, an increase of 6% compared to the second quarter of 2023 and an increase of 1% compared to the third quarter of 2022. Pre-tax pre-provision earnings¹ for the nine months ended September 30, 2023 were $130.6 million, an increase of $11.7 million, or 10%, when compared to the nine months ended September 30, 2022. Adjusted pre-tax pre-provision earnings¹ were $54.8 million in the third quarter of 2023, a decrease of 15% compared to the second quarter of 2023 and an increase of 12% compared to the third quarter of 2022. Adjusted pre-tax pre-provision earnings¹ for the nine months ended September 30, 2023 were $190.7 million, an increase of $53.6 million, or 39%, when compared to the nine months ended September 30, 2022
• Net interest income totaled $119.3 million in the third quarter of 2023, a decrease of $7.7 million, or 6%, from the second quarter of 2023 and an increase of $31.0 million, or 35%, compared to the third quarter of 2022. During the third quarter of 2023, higher interest expense on deposits was driven by higher rates, including new requirements by the Florida Bar Association for higher rates on certain trust accounts, and by changes in product mix. These were partially offset by higher interest income on securities and loans. Accretion on acquired loans totaled $14.8 million in the third quarter of 2023, $14.6 million in the second quarter of 2023, and $2.2 million in the third quarter of 2022. For the nine months ended September 30, 2023, net interest income was $377.4 million, an increase of $131.0 million, or 53%, compared to the nine months ended September 30, 2022. Accretion on acquired loans totaled $45.4 million for the nine months ended September 30, 2023, compared to $8.7 million for the nine months ended September 30, 2022.
• Net interest margin decreased 29 basis points to 3.57% in the third quarter of 2023 compared to 3.86% in the second quarter of 2023. Loan yields were 5.93%, up four basis points from the prior quarter, and reflected an increase of 148 basis points compared to the prior year quarter. The effect on loan yields of accretion of purchase discounts on acquired loans was an increase of 59 basis points in the third quarter of 2023, an increase of 58 basis points in the second quarter of 2023 and an increase of 14 basis points in the third quarter of 2022. Securities yields increased 19 basis points to 3.32%, compared to 3.13% in the prior quarter. The cost of deposits increased 41 basis points, from 1.38% in the prior quarter, to 1.79% for the third quarter of 2023.
• Noninterest income totaled $17.8 million in the third quarter of 2023, a decrease of $3.8 million, or 18%, compared to the prior quarter, and an increase of $1.7 million, or 10%, compared to the prior year quarter. Of the $3.8 million decrease in the third quarter of 2023, $3.4 million resulted from the impact of the Durbin amendment, which became effective for Seacoast on July 1, 2023, and limits network interchange fees earned on debit card transactions. Also in the third quarter of 2023, changes in the interest rate environment resulted in losses of $0.4 million recognized as a result of declines in the value of investments in mutual funds holding CRA-qualified debt securities.
• The provision for credit losses was $2.7 million in the third quarter of 2023, compared to a net benefit of $0.8 million in the second quarter of 2023 and a provision of $4.7 million in the third quarter of 2022.
• Noninterest expense was $93.9 million in the third quarter of 2023, a decrease of $14.0 million, or 13%, compared to the prior quarter, and an increase of $32.6 million, or 53%, compared to the prior year quarter. Noninterest expense was $309.3 million for the nine months ended September 30, 2023, compared to $176.4 million in the nine months ended September 30, 2022. Changes compared to the second quarter of 2023 included:
  • During the third quarter of 2023, the Company completed its reduction in force, reducing headcount by 6%, and consolidated a branch location.
  • Salaries and wages increased $1.3 million to $46.4 million in the third quarter of 2023. The third quarter of 2023 included $3.2 million in severance-related expenses arising from the Company’s reduction in workforce. This compares to $1.6 million in merger-related expenses in the second quarter of 2023.
  • Outsourced data processing costs decreased $11.5 million, or 57%, to $8.7 million in the third quarter of 2023. Included in the second quarter of 2023 were $10.9 million in merger-related expenses.
  • Telephone/data lines decreased $0.1 million to $1.4 million and furniture and equipment decreased $0.3 million to $2.1 million in the third quarter of 2023.
  • Marketing decreased $0.2 million to $1.9 million in the third quarter of 2023. Marketing expenses are expected to be higher in the fourth quarter of 2023.
  • Occupancy costs decreased $0.7 million to $6.3 million in the third quarter of 2023 reflecting branch consolidation and cost synergies from recent acquisitions, including one additional branch consolidation in July.
  • Legal and professional fees decreased $1.4 million to $2.7 million in the third quarter of 2023, with $1.7 million of merger-related expenses incurred in the second quarter of 2023.
  • Other noninterest expenses decreased $1.1 million to $7.2 million in the third quarter of 2023, the benefit of acquisition-related cost synergies.
• Seacoast recorded $9.1 million of income tax expense in the third quarter of 2023, compared to $10.2 million in the second quarter of 2023, and $9.1 million in the third quarter of 2022.
• The efficiency ratio was 62.60% in the third quarter of 2023, compared to 67.34% in the second quarter of 2023 and 57.13% in the prior year quarter. The adjusted efficiency ratio¹ was 60.19% in the third quarter of 2023, compared to 56.44% in the second quarter of 2023 and 53.28% in the prior year quarter. The Company continues to remain keenly focused on disciplined expense control. The increase in the adjusted efficiency ratio in the third quarter of 2023 reflects the impact of higher deposit rates, including the first full quarter of the Florida Bar Association’s change to rates required to be paid on certain trust accounts, and the first time impact of the Durbin Amendment on interchange income. The adjusted efficiency ratio¹ for the nine months ended September 30, 2023 was 56.47% compared to 53.73% for the nine months ended September 30, 2022.

Balance Sheet

• At September 30, 2023, the Company had total assets of $14.8 billion and total shareholders’ equity of $2.0 billion. Book value per share was $24.06 on September 30, 2023, compared to $24.14 on June 30, 2023, and $20.95 on September 30, 2022. Tangible book value per share totaled $14.26 on September 30, 2023 compared to $14.24 on June 30, 2023 and $15.98 on September 30, 2022. Removing the impact of the change in accumulated comprehensive income, tangible book value per share would have been higher by $0.30, reaching $14.56, an increase of 8% on an annualized basis.
• Debt securities totaled $2.5 billion on September 30, 2023, a decrease of $90.8 million, or 3%, compared to June 30, 2023. Debt securities include approximately $1.8 billion in securities held at fair value and classified as available for sale. The unrealized loss on these securities is fully reflected in the value presented on the balance sheet. The portfolio also includes $691.4 million in securities classified as held to maturity with a fair value of $537.2 million. Held-to-maturity securities consist solely of mortgage-backed securities and collateralized mortgage obligations guaranteed by U.S. government agencies, each of which is expected to recover any price depreciation over its holding period as the debt securities move to maturity. The Company has significant liquidity and available borrowing capacity and has the intent and ability to hold these investments to maturity.
• Loans decreased $106.7 million when compared to the prior quarter, totaling $10.0 billion as of September 30, 2023. Loan originations were $244.6 million in the third quarter of 2023, a decrease of 53% compared to $518.9 million in the second quarter of 2023. New add on yields were near 8% during the third quarter of 2023. The Company continues to exercise a disciplined approach to lending, carefully underwriting loans to strict underwriting guidelines and setting high expectations for risk adjusted returns given the current environment.
• Loan pipelines (loans in underwriting and approval or approved and not yet closed) totaled $353.0 million on September 30, 2023, an increase of 24% from June 30, 2023, and a decrease of 43% from September 30, 2022.
  • Commercial pipelines were $300.8 million as of September 30, 2023, an increase of 38% from $217.6 million at June 30, 2023, and a decrease of 43% from $530.4 million at September 30, 2022.
  • Consumer pipelines were $24.5 million as of September 30, 2023, a decrease of $4.0 million from $28.4 million at June 30, 2023, and a decrease of 44% from $43.7 million at September 30, 2022.
  • Residential saleable pipelines were $6.8 million as of September 30, 2023, compared to $11.5 million at June 30, 2023, and $6.6 million at September 30, 2022. Retained residential pipelines were $20.9 million as of September 30, 2023, compared to $27.1 million at June 30, 2023, and $60.7 million at September 30, 2022.
• Total deposits were $12.1 billion as of September 30, 2023, a decrease of $175.4 million when compared to June 30, 2023, and an increase of $3.3 billion, or 38%, compared to September 30, 2022. Excluding the paydown in brokered balances, total deposits increased $108.1 million, or 3.7% annualized, during the third quarter of 2023. Seacoast’s granular, longstanding deposit base is a hallmark of our franchise, and in the current economic environment serves as a significant source of strength.
  • During the third quarter of 2023, the Company grew organic deposits 3.7% annualized and used the proceeds to pay down brokered deposits and FHLB borrowings, bolstering the balance sheet and supporting the net interest margin.
  • At September 30, 2023, transaction account balances represented 55% of overall deposits.
  • Noninterest demand deposits are a peer-leading 32% of overall deposits.
  • The Company benefits from a granular deposit franchise, with the top ten depositors representing only 3% of total deposits.
  • Average deposits per banking center were $157 million at September 30, 2023, unchanged from the prior quarter.
  • Uninsured deposits represented only 34% of overall deposit accounts as of September 30, 2023. This includes public funds under the Florida Qualified Public Depository program, which provides loss protection to depositors beyond FDIC insurance limits. Excluding such balances, the uninsured and uncollateralized deposits were 29% of total deposits. The Company has liquidity sources including cash and lines of credit with the Federal Reserve and Federal Home Loan Bank that represent 154% of uninsured deposits, and 182% of uninsured and uncollateralized deposits.
  • Consumer deposits represent 43% of overall deposit funding with an average consumer customer balance of $24 thousand. Commercial deposits represent 57% of overall deposit funding with an average business customer balance of $111 thousand.
  • Year over year, the Company increased its deposit market share from #18 in 2022 to #15 in 2023.
• Federal Home Loan Bank advances totaled $110.0 million at September 30, 2023 with a weighted average interest rate of 2.88%. In the aggregate, borrowed funds, including FHLB advances, subordinated debt and brokered deposits represented only 4.1% of total liabilities as of September 30, 2023. During the third quarter of 2023, the Company paid down $333.4 million in FHLB advances and brokered deposits.

Asset Quality

• Net charge-offs of $12.7 million during the third quarter of 2023 included the complete charge-off of an $11.3 million acquired loan. The charge-off had no impact on earnings or capital, as the Company expected and fully reserved for the loss at acquisition through purchase accounting.
• Credit metrics remain strong with 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 were $41.5 million at September 30, 2023, a decline from $48.3 million at June 30, 2023. Nonperforming loans to total loans outstanding were 0.41% at September 30, 2023, 0.48% at June 30, 2023, and 0.32% at September 30, 2022.
• Nonperforming assets to total assets decreased to 0.33% at September 30, 2023, compared to 0.37% at June 30, 2023, and increased from 0.23% at September 30, 2022.
• The ratio of allowance for credit losses to total loans was 1.49% at September 30, 2023, 1.58% at June 30, 2023, and 1.42% at September 30, 2022. The impact of the full charge-off of an $11.3 million acquired loan was partially offset by a build of allowance relating to macroeconomic outlook.
• 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 loan size is $306 thousand, and the average commercial loan size is $683 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 51% and 248% of total bank-level risk-based capital, respectively, compared to 52% and 256%, respectively, at June 30, 2023. On a consolidated basis, construction and land development and commercial real estate loans represent 48% and 234%, 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 September 30, 2023 of 13.9% compared to 13.5% at June 30, 2023, and 16.5% at September 30, 2022. The Total capital ratio was 15.0%, the Common Equity Tier 1 capital ratio was 13.3%, and the Tier 1 leverage ratio was 10.6% at September 30, 2023. The Company is considered “well capitalized” based on applicable U.S. regulatory capital ratio requirements.
• Cash and cash equivalents at September 30, 2023 totaled $696.0 million.
• The Company’s loan to deposit ratio was 83% at September 30, 2023, providing liquidity and flexibility moving forward.
• Tangible common equity to tangible assets was 8.68% at September 30, 2023, compared to 8.53% at June 30, 2023, and 9.79% at September 30, 2022. If all held-to-maturity securities were adjusted to fair value, the tangible common equity ratio would have been 7.89%.
• At September 30, 2023, in addition to $696.0 million in cash, the Company had $5.7 billion in available borrowing capacity, including $4.8 billion in available collateralized lines of credit, $0.6 billion of unpledged debt securities available as collateral for potential additional borrowings, and available unsecured lines of credit of $0.3 billion. These liquidity sources as of September 30, 2023 represented 182% of uninsured and uncollateralized deposits.
• In September 2023, Kroll Bond Rating Agency (“KBRA”) affirmed Seacoast’s senior unsecured debt rating (BBB+) and subordinated debt rating (BBB), with a “Stable” outlook for all long-term ratings.
• Under its share repurchase program, the Company is authorized to purchase up to $100 million of its shares of outstanding common stock.

Recognition

• In October 2023, Seacoast was recognized among Fortune’s Best Workplaces for Women for 2023. Seacoast sets a leading example by fostering inclusivity, empowering women, and creating a workplace where every individual can reach their full potential.
• Seacoast has been Certified™ by Great Place To Work® for 2023. As the global authority on workplace culture, Great Place To Work® brings 30 years of groundbreaking research and data to recognize workplaces that create the conditions for an overwhelmingly positive employee experience.
• Seacoast earned recognition from the South Florida Business Journal and the Orlando Business Journal as one of 2023’s Best Places to Work and has received similar honors the past two years from American Banker.

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

OTHER INFORMATION

Conference Call Information
Seacoast will host a conference call October 27^th, 2023, at 10:00 a.m. (Eastern Time) to discuss the third quarter 2023 earnings results and business trends. Investors may call in (toll-free) by dialing (800) 919-1728. 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 $14.8 billion in assets and $12.1 billion in deposits as of September 30, 2023. Seacoast provides integrated financial services including commercial and consumer banking, wealth management, and mortgage services to customers at 77 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. 

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

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, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), 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, or expects to acquire, as well as statements with respect to Seacoast’s objectives, strategic plans, expectations and intentions and other statements that are not historical facts. 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 Banking Corporation of Florida (“Seacoast” or the “Company”) or its wholly-owned banking subsidiary, Seacoast National Bank (“Seacoast Bank”), to be materially different from 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, changes in 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 and credit risk as a result of the foregoing; potential impacts of the recent adverse developments in the banking industry highlighted by high-profile bank failures, including impacts on customer confidence, deposit outflows, liquidity and the regulatory response thereto; 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; changes in accounting policies, rules and practices; changes in retail distribution strategies, customer preferences and behavior generally and as a result of economic factors, including heightened inflation; 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; Seacoast’s 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 decline in stock market prices on our fee income from our wealth management business; 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; fraud or misconduct by internal or external actors, which Seacoast may not be able to prevent, detect or mitigate; 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, including hurricanes in the Company’s footprint, 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; 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; risks related to environmental, social and governance (“ESG”) matters, the scope and pace of which could alter Seacoast’s reputation and shareholder, associate, customer and third-party affiliations; and other factors and risks described under “Risk Factors” herein and in any of the Company’s subsequent reports filed with the SEC and available on its website at www.sec.gov

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, 2022 and quarterly reports on Form 10-Q for the quarters ended March 31, 2023 and June 30, 2023 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.