What changed in this filing

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Item 2. Management’s Discussion and Analysis

2025-05-07 compared with 2024-11-06 · 243 added, 350 removed, 425 unchanged (58% of the section changed)

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Such discussion and analysis should be read in conjunction with the Company’s Condensed Consolidated Financial Statements and the related notes included in this report.

The emphasis of this discussion will be on the three and nine months ended September 30, 2024 compared to the three and nine months ended September 30, 2023 for the consolidated statements of income.

For the consolidated balance sheets, the emphasis of this discussion will be the balances as of September 30, 2024 compared to December 31, 2023.

The emphasis of this discussion will be on the three months ended March 31, 2025 compared to the three months ended March 31, 2024 for the consolidated statements of income.

For the consolidated balance sheets, the emphasis of this discussion will be the balances as of March 31, 2025 compared to December 31, 2024.

This discussion and analysis contain statements that may be considered “forward-looking statements” as defined in, and subject to the protections of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.

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Certain statements made or incorporated by reference herein which are not statements of historical fact, including those under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and elsewhere herein, are “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”).

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 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 those set forth in the forward-looking statements.

All statements other than statements of historical fact could be forward-looking statements.

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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;

• 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, tariffs or trade wars (including reduced consumer spending, supply chain issues, and adverse impacts to credit quality), slowdowns in economic growth or recession, 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 adverse developments in the banking industry, including those highlighted by high-profile bank failures, and including impacts on customer confidence, deposit outflows, liquidity and the regulatory response thereto (including increases in the cost of our deposit insurance assessments), the Company’s ability to effectively manage its liquidity risk and any growth plans, and the availability of capital and funding;

• 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 proposed overdraft and late fee caps, including those that impact the money supply and inflation;

• 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 overdraft and late fee caps (if implemented), 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 (including the impact of interest rates on macroeconomic conditions, customer and client behavior, and on our net interest income), as well as the impact of fluctuating interest rates on our financial projections and models, sensitivities, and the shape of the yield curve;

• Interest rate risks (including the impact of interest rates on macroeconomic conditions, customer and client behavior, and on our net interest income), 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 retail distribution strategies, customer preferences and behavior generally and as a result of economic factors, including heightened or persistent inflation;

• Changes in the availability and cost of credit and capital in the financial markets;

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• The failure of assumptions underlying the establishment of reserves for expected credit losses;

• Risks related to, and the costs associated with, environmental, social and governance (“ESG”) matters, including the scope and pace of related rulemaking activity and disclosure requirements;

• Risks related to, and the costs associated with ESG and anti-ESG matters, including the scope and pace of related rulemaking activity, disclosure requirements and potential litigation;

• A deterioration of the credit rating for U.S.

long-term sovereign debt, actions that the U.S.

government may take to avoid exceeding the debt ceiling, and uncertainties surrounding the federal budget and economic policy;

government may take to avoid exceeding the debt ceiling, and uncertainties surrounding the federal budget and economic policy, including the impact of tariffs and trade policies;

• The risk that balance sheet, revenue growth, and loan growth expectations may differ from actual results;

• 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 that are made or are attributable to Seacoast 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, 2023 and in other periodic reports that the Company files with the SEC.

All written or oral forward-looking statements attributable to Seacoast are expressly qualified in their entirety by this cautionary notice.

The Company assumes no obligation to update, revise or correct any forward-looking statements that are made from time to time, either as a result of future developments, new information or otherwise, except as may be required by law.

Business Developments

Proposed Acquisition of Heartland Bancshares, Inc.

On February 27, 2025, the Company announced its proposed acquisition of Heartland Bancshares, Inc.

The transaction, which is expected to close in the third quarter of 2025, will expand the Company’s presence in Central Florida.

Results of Operations

Seacoast provides integrated financial services including commercial and consumer banking, wealth management, and mortgage services to customers at 79 full-service branches across Florida, and through advanced mobile and online banking solutions.

The Company’s financial results in the third quarter of 2024 include strong growth in loans and deposits supporting improved net interest income.

Growth in noninterest income continues, and with significant cost-saving initiatives now complete, Seacoast continues to prudently manage expenses while strategically investing to support continued growth.

Highlights for the third quarter of 2024 include:

• Net income of $30.7 million, or $0.36 per average diluted share, an increase of $0.4 million, or 1%, from the prior quarter.

• Pre-tax pre-provision earnings on an adjusted basis 1 increased $1.9 million to $46.4 million from the prior quarter.

• Tangible book value per share increased 20% on an annualized basis to $16.20.

• Loans grew 6.6% on an annualized basis to $10.2 billion, and the overall loan pipeline remained strong at $831.1 million.

• Growth in customer deposits, excluding brokered deposits, of $195.9 million, or 6.6% annualized.

The Company’s financial results in the first quarter of 2025 include strong growth in loans and deposits supporting improved net interest income and net interest margin.

Seacoast continues to prudently manage expenses while strategically investing to support continued growth.

Highlights for the first quarter of 2025 include:

• Net income of $31.5 million, or $0.37 per average diluted share.

• Pre-tax pre-provision earnings 1 increased $2.7 million to $50.6 million from the prior quarter.

• Growth in total deposits of $332.4 million, or 11.0% annualized.

• Noninterest bearing deposits grew $140.1 million, or 17.0% annualized.

• Net interest margin was 3.17%, nearly flat compared to 3.18% in the prior quarter, and net interest margin, excluding accretion on acquired loans, expanded to 2.90% from 2.87%.

• Net interest income of $106.7 million, an increase of $2.2 million, or 2%, from the second quarter of 2024.

• Noninterest income increased to $23.7 million, representing a 33% year-over-year increase compared to the three months ended September 30, 2023.

• Loans grew 5.6% on an annualized basis to $10.4 billion.

• Net interest income of $118.5 million, an increase of $2.7 million, or 2%, from the fourth quarter of 2024.

• Net interest margin was 3.48% compared to 3.39% in the prior quarter.

• Cost of deposits declined 15 basis points to 1.93%.

• Tangible book value per share increased 10% year over year to $16.71.

• Strong capital position, with a Tier 1 capital ratio of 14.7%, and a tangible common equity to tangible assets ratio of 9.6%.

The Company’s focus on organic customer growth and recent talent additions are generating momentum across its markets and business segments.

The results for the third quarter of 2024 evidence the inflection in growth and the start of margin expansion expected during the second half of 2024.

For the third quarter of 2024, the Company reported net income of $30.7 million, or $0.36 per average diluted share, an increase of $0.4 million, or 1%, from the second quarter of 2024 and a decrease of $0.8 million, or 2%, compared to the third quarter of 2023.

Adjusted net income 1 for the third quarter of 2024 totaled $30.5 million, or $0.36 per average diluted share, an increase of $0.2 million, or 1%, compared to the second quarter of 2024 and a decrease of $3.7 million, or 11%, compared to the third quarter of 2023.

For the nine months ended September 30, 2024, net income totaled $86.9 million, or $1.02 per average diluted share, an increase of $12.4 million, or 17%, compared to the nine months ended September 30, 2023.

For the nine months ended September 30, 2024, adjusted net income 1 totaled $91.9 million, or $1.08 per average diluted share, compared to $101.9 million, or $1.21 per average diluted share for the nine months ended September 30, 2023.

Third Second Third Nine Months Ended

Quarter Quarter Quarter September 30,

The Company’s focus on organic customer growth and recent talent additions is generating momentum across its markets and business segments.

For the first quarter of 2025, the Company reported net income of $31.5 million, or $0.37 per diluted share, a decrease of $2.6 million, or 8%, from the fourth quarter of 2024 and an increase of $5.5 million, or 21%, compared to the first quarter of 2024.

Adjusted net income 1 for the first quarter of 2025 totaled $32.1 million, or $0.38 per diluted share, a decrease of $8.5 million, or 21%, compared to the fourth quarter of 2024 and an increase of $1.0 million, or 3%, compared to the first quarter of 2024.

First Fourth First

Quarter Quarter Quarter

2025 2024 2024

Return on average assets 0.83 % 0.89 % 0.71 %

Return on average tangible assets 0.98 % 1.06 % 0.89 %

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Efficiency ratio 60.28 56.26 66.78

Adjusted return on average assets 1

0.85 % 1.06 % 0.85 %

Adjusted return on average tangible assets 1

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Net Interest Income and Margin

Net interest income for the third quarter of 2024 totaled $106.7 million, an increase of $2.2 million, or 2%, compared to the second quarter of 2024, and a decrease of $12.6 million , or 11% , c ompared to the third quarter of 2023.

For the nine months ended September 30, 2024, net interest income totaled $316.2 million, a decrease of $61.3 million, or 16%, compared to the nine months ended September 30, 2023.

In the loan portfolio, higher interest income from new loan production was partially offset by lower accretion of purchase discount on acquired loans.

Recent purchases in the securities portfolio contributed to higher securities yields.

Higher interest expense on deposits reflects the impact of higher rates, with cuts to the federal funds rate late in the quarter not yet fully impacting the third quarter of 2024 results.

Net interest income (on a fully taxable equivalent basis) 1 for the third quarter of 2024 was $107.0 million, an increase of $2.3 million, or 2%, compared to the second quarter of 2024, and a decrease of $12.5 million, or 10%, c ompared to the third quarter of 2023.

Accretion on acquired loans totaled $9.2 million for the third quarter of 2024, compared to $10.2 million for the second quarter of 2024, and $14.8 million for the third quarter of 2023.

For the nine months ended September 30, 2024, net interest income (on a fully taxable equivalent basis) 1 was $316.9 million, a decrease of $61.1 million, or 16%, compared to the nine months ended September 30, 2023.

Accretion on acquired loans totaled $30.0 million for the nine months ended September 30, 2024, compared to $45.4 million for the nine months ended September 30, 2023.

Net interest margin (on a fully taxable equivalent basis) 1 decreased one basis point to 3.17% in the third quarter of 2024, compared to 3.18% in the second quarter of 2024, and decreased 40 basis points from 3.57% in the third quarter of 2023, largely driven by higher deposit costs.

Compared to the second quarter of 2024, securities yields increased six basis points in the third quarter of 2024 to 3.75% and increased 42 basis points from the third quarter of 2023.

The yield on loans increased to 5.94% for the third quarter of 2024, an increase of one basis point from both the second quarter of 2024 and from the third quarter of 2023.

The effect on net interest margin of accretion of purchase discounts on acquired loans was an increase of 27 basis points for the third quarter of 2024, 30 basis points in the second quarter, and 44 basis points in the third quarter of 2023.

The cost of deposits was 2.34% in the third quarter of 2024, compared to 2.31% in the second quarter of 2024, and 1.79% in the third quarter of 2023.

Net interest income totaled $118.5 million in the first quarter of 2025, an increase of $2.7 million, or 2% , c ompared to the prior quarter, and an increase of $13.4 million, or 13%, compared to the prior year first quarter.

The increase in the first quarter of 2025 was largely driven by lower deposit costs, which declined 15 basis points when compared to the fourth quarter of 2024.

Securities income increased $2.4 million, or 9%, primarily the result of securities purchases during the first quarter of 2025.

Interest income on loans declined by $1.4 million, or 1%, in the first quarter of 2025, with higher core yields more than offset by lower accretion on acquired loans and lower day count.

Included in loan interest income was accretion on acquired loans of $8.2 million in the first quarter of 2025, $11.7 million in the fourth quarter of 2024, and $10.6 million in the first quarter of 2024.

Net interest margin increased nine basis points to 3.48% in the first quarter of 2025 compared to 3.39% in the fourth quarter of 2024.

Excluding the effects of accretion on acquired loans, net interest margin expanded 19 basis points to 3.24% in the first quarter of 2025 compared to 3.05% in the fourth quarter of 2024.

Loan yields were 5.90%, a decrease of three basis points from the prior quarter attributed to lower accretion on acquired loans.

Securities yields increased 11 basis points to 3.88%, compared to 3.77% in the prior quarter, benefiting from new purchases.

The cost of deposits declined 15 basis points from 2.08% in the prior quarter to 1.93% in the first quarter of 2025.

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

For the nine months ended September 30, 2024, net interest margin (on a fully taxable equivalent basis) 1 decreased 72 basis points to 3.19% compared to the nine months ended September 30, 2023, largely driven by higher deposit costs.

The yield on securities was 3.65% for the nine months ended September 30, 2024, compared to 3.10% for the nine months ended September 30, 2023.

The yield on total loans increased from 5.89% for the nine months ended September 30, 2023 to 5.93% for the nine months ended September 30, 2024.

The effect on net interest margin of accretion of purchase discounts on acquired loans was an increase of 30 basis points for the nine months ended September 30, 2024, and 47 basis points for the nine months ended September 30, 2023.

The cost of deposits was 2.28% for the nine months ended September 30, 2024, an increase of 95 basis points compared to the nine months ended September 30, 2023.

In the remainder of 2024, the Company expects to continue growing customer relationships resulting in growth in loans and deposits.

This growth, combined with lower rates on deposits resulting from expected short-term interest rate reductions, should benefit net interest income and net interest margin in the fourth quarter of 2024.

The following table details the trend for net interest income and margin results (on a fully taxable equivalent basis) 1 , the yield on earning assets and the rate paid on interest bearing liabilities for the periods specified:

The following table details the trend for net interest income and margin results (on a FTE basis) 1 , the yield on earning assets and the rate paid on interest bearing liabilities for the periods specified:

(In thousands, except ratios) Net Interest

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Bearing Liabilities

Third quarter 2024 $ 106,975 3.17 % 5.46 % 3.32 %

Second quarter 2024 104,657 3.18 % 5.47 % 3.33 %

Third quarter 2023 119,505 3.57 % 5.38 % 2.76 %

Nine months ended September 30, 2024 316,930 3.19 % 5.44 % 3.28 %

Nine months ended September 30, 2023 378,009 3.91 % 5.30 % 2.19 %

1 On a fully taxable equivalent basis, a non-GAAP measure - see “ Explanation of Certain Unaudited Non-GAAP Financial Measures ” for more information and a reconciliation to GAAP.

Average loans increased $123.7 million, or 1%, for the third quarter of 2024 compared to the second quarter of 2024, and increased $85.2 million, or 1%, from the third quarter of 2023.

For the nine months ended September 30, 2024, average loans increased $216.0 million, or 2%, from the nine months ended September 30, 2023.

Average loans as a percentage of average earning assets totaled 75% for the third quarter of 2024, 76% for the second quarter of 2024 and 76% for the third quarter of 2023.

For each of the nine months ended September 30, 2024 and September 30, 2023, average loans as a percentage of average earning assets totaled 76%.

During the third quarter of 2024, average investment securities increased $127.1 million, or 4.8%, compared to the second quarter of 2024, and increased $171.9 million, or 6.6%, compared to the third quarter of 2023.

Securities yields increased six basis points to 3.75% during the third quarter of 2024 from 3.69% in the second quarter of 2024, benefiting from recent purchases.

For the nine months ended September 30, 2024, average investment securities were $2.7 billion, a decrease of $3.7 million compared to the nine months ended September 30, 2023.

The cost of average interest-bearing liabilities decreased one basis point in the third quarter of 2024 to 3.32% from 3.33% in the second quarter of 2024, and increased 56 basis points from 2.76% in the third quarter of 2023.

The cost of average total deposits (including noninterest bearing demand deposits) was 2.34% in the third quarter of 2024, 2.31% in the second quarter of 2024 and 1.79% in the third quarter of 2023.

For the nine months ended September 30, 2024, the cost of average total deposits (including noninterest bearing demand deposits) was 2.28% compared to 1.33% for the nine months ended September 30, 2023.

During the third quarter of 2024, average transaction deposits (noninterest and interest-bearing demand) decreased $273.4 million, or 4%, compared to the second quarter of 2024 and decreased $909.2 million, or 13%, compared to the third quarter of 2023.

For the nine months ended September 30, 2024, average transaction deposits decreased $751.8 million, or 11%, compared to the nine months ended September 30, 2023.

Declines reflect shifts in customer preference during the periods toward money market accounts, which increased $276.5 million, or 8%, in the third quarter of 2024 compared to the prior quarter, and increased $841.7 million, or 30%, in the nine months ended September 30, 2024 compared to the prior year period.

The Company’s deposit mix remains favorable, with 86% of average deposit balances comprised of savings, money market, and demand deposits for the nine months ended September 30, 2024.

Average balances of sweep repurchase agreements with customers decreased $52.5 million, or 18%, from the second quarter of 2024 and decreased $86.6 million, or 26%, compared to the third quarter of 2023.

The average rate on customer sweep repurchase accounts was 3.37% for the third quarter of 2024, compared to 3.68% for the second quarter of 2024, and 3.48% for the third quarter of 2023.

For the nine months ended September 30, 2024, the average balance was $289.2 million, compared to an average balance of $249.2 million for the nine months ended September 30, 2023 with average rates of 3.61% and 2.86%, respectively.

The Company had an average balance of $237.9 million in FHLB borrowings outstanding for the third quarter of 2024, with an average interest rate of 4.26%, compared to $149.2 million for the second quarter of 2024, with an average interest rate of 4.29%, and $111.1 million for the third quarter of 2023, with an average interest rate of 3.17%.

The Company had an average balance of $163.5 million in FHLB borrowings outstanding for the nine months ended September 30, 2024, with an average interest rate of 4.17%, compared to $214.4 million for the nine months ended September 30, 2023, with an average interest rate of 3.70%.

Long-term debt balances averaged $106.7 million in the third quarter of 2024, $106.5 million in the second quarter of 2024, and $106.0 million in the third quarter of 2023.

The average rate on long-term debt for the third quarter of 2024 was 7.05%, an increase of two basis points compared to the second quarter of 2024 and a decrease of 13 basis points compared to the third quarter of 2023.

For the nine months ended September 30, 2024, long-term debt averaged $106.5 million, compared to $103.5 million for the nine months ended September 30, 2023.

The average rate on long-term debt for the nine months ended September 30, 2024 was 7.13%, an increase of 25 basis points compared to the nine months ended September 30, 2023.

The long-term debt is comprised of trust preferred securities issued by subsidiary trusts of the Company, and notes assumed in bank acquisitions in 2022 and 2023.

The following tables detail average balances, net interest income and margin results (on a fully taxable equivalent basis, a non-GAAP measure) for the periods presented:

First quarter 2025 $ 118,857 3.48 % 5.41 % 2.74 %

Fourth quarter 2024 116,115 3.39 % 5.43 % 2.96 %

First quarter 2024 105,298 3.24 % 5.41 % 3.20 %

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

Average loans increased $169.0 million, or 2%, for the first quarter of 2025 compared to the fourth quarter of 2024, and increased $348.8 million, or 3%, from the first quarter of 2024.

Average loans as a percentage of average earning assets totaled 75% for the first quarter of 2025, 75% for the fourth quarter of 2024 and 77% for the first quarter of 2024.

During the first quarter of 2025, average investment securities increased $229.0 million, or 8.0%, compared to the fourth quarter of 2024, and increased $493.7 million, or 19.1%, compared to the first quarter of 2024.

Securities yields increased eleven basis points to 3.88% during the first quarter of 2025 from 3.77% in the fourth quarter of 2024, benefiting from recent purchases.

The cost of average interest-bearing liabilities decreased 22 basis points in the first quarter of 2025 to 2.74% from 2.96% in the fourth quarter of 2024, and decreased 45 basis points from 3.20% in the first quarter of 2024.

The cost of average total deposits (including noninterest bearing demand deposits) was 1.93% in the first quarter of 2025, 2.08% in the fourth quarter of 2024 and 2.19% in the first quarter of 2024.

During the first quarter of 2025, average transaction deposits (noninterest and interest-bearing demand) increased $0.9 million compared to the fourth quarter of 2024, and increased $247.6 million, or 4%, compared to the first quarter of 2024.

The Company’s deposit mix remains favorable, with 87% of average deposit balances compromised of savings, money market, and demand deposits for the three months ended March 31, 2025.

Average balances of sweep repurchase agreements with customers decreased $8.6 million, or 4%, from the fourth quarter of 2024 and decreased $132.1 million, or 40%, compared to the first quarter of 2024.

The average rate on customer sweep repurchase accounts was 2.73% for the first quarter of 2024, compared to 3.00% for the fourth quarter of 2024, and 3.71% for the first quarter of 2024.

The Company had an average balance of $382.8 million in FHLB borrowings outstanding for the first quarter of 2025, with an average interest rate of 4.32%, compared to $245.0 million for the fourth quarter of 2024, with an average interest rate of 4.26%, and $102.4 million for the first quarter of 2024, with an average interest rate of 3.77%.

Long-term debt balances averaged $107.0 million in the first quarter of 2025, $106.9 million in the fourth quarter of 2024, and $106.4 million in the first quarter of 2024.

The average rate on long-term debt for the first quarter of 2025 was 6.44%, a decrease of twenty-five basis points compared to the fourth quarter of 2024 and a decrease of 87 basis points compared to the first quarter of 2024.

The following tables detail average balances, net interest income and margin results (on a FTE basis, a non-GAAP measure) for the periods presented:

Average Balances, Interest Income and Expenses, Yields and Rates 1

Third Quarter Second Quarter Third Quarter

First Quarter Fourth Quarter First Quarter

Average Yield/ Average Yield/ Average Yield/

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Securities sold under agreements to repurchase

Federal Home Loan Bank borrowings 237,935 2,549 4.26 149,234 1,592 4.29 111,087 888 3.17

Long-term debt, net 106,706 1,892 7.05 106,532 1,862 7.03 106,036 1,919 7.18

Total Interest-Bearing Liabilities 9,280,948 77,450 3.32 9,101,576 75,384 3.33 8,711,647 60,540 2.76

Noninterest demand 3,393,110 3,485,603 3,987,761

Other liabilities 154,344 134,900 133,846

Total Liabilities 12,828,402 12,722,079 12,833,254

Shareholders’ equity 2,168,444 2,117,628 2,072,747

Total Liabilities & Equity $ 14,996,846 $ 14,839,707 $ 14,906,003

Cost of deposits 2.34 % 2.31 % 1.79 %

Interest expense as a % of earning assets 2.29 % 2.29 % 1.81 %

Net interest income as a % of earning assets $ 106,975 3.17 % $ 104,657 3.18 % $ 119,505 3.57 %

1 On a fully taxable equivalent basis, a non-GAAP measure - see “Explanation of Certain Unaudited Non-GAAP Financial Measures” for more information and a reconciliation to GAAP.

All yields and rates have been computed on an annual basis using amortized cost.

Fees on loans have been included in interest on loans.

Nonaccrual loans are included in loan balances.

Average Balances, Interest Income and Expenses, Yields and Rates 1

Nine Months Ended September 30, Nine Months Ended September 30,

Average Yield/ Average Yield/

(In thousands, except ratios) Balance Interest Rate Balance Interest Rate

Earning assets:

Taxable $ 2,655,422 $ 72,511 3.65 % $ 2,649,127 $ 61,543 3.10 %

Nontaxable 5,677 123 2.89 15,721 370 3.14

Total Securities 2,661,099 72,634 3.65 2,664,848 61,913 3.10

Federal funds sold 438,089 17,929 5.47 336,022 12,444 4.95

Interest bearing deposits with other banks and other investments 102,415 3,721 4.85 90,511 4,530 6.69

Total Loans, net 10,056,466 446,108 5.93 9,840,484 433,821 5.89

Total Earning Assets 13,258,069 540,392 5.44 12,931,865 512,708 5.30

Allowance for credit losses (145,579) (151,613)

Cash and due from banks 167,424 185,426

Premises and equipment, net 110,929 116,840

Intangible assets 819,046 811,483

Bank owned life insurance 302,220 287,756

Other assets including deferred tax assets 330,898 402,175

Total Assets $ 14,843,007 $ 14,583,932

Liabilities and Shareholders' Equity

Interest-bearing liabilities:

Interest-bearing demand $ 2,626,026 $ 43,117 2.19 % $ 2,642,180 $ 25,780 1.30 %

Savings 586,285 1,701 0.39 909,184 1,292 0.19

Money market 3,673,493 105,998 3.85 2,831,747 54,540 2.58

Time deposits 1,646,285 54,051 4.39 1,288,736 36,490 3.79

Securities sold under agreements to repurchase 289,181 7,806 3.61 249,242 5,333 2.86

201,271 1,357 2.73 209,909 1,584 3.00 333,386 3,079 3.71

Federal Home Loan Bank borrowings 382,836 4,081 4.32 245,000 2,625 4.26 102,418 960 3.77

9 unchanged sentences

Net interest income as a % of earning assets $ 118,857 3.48 % $ 116,115 3.39 % $ 105,298 3.24 %

1 On a fully taxable equivalent basis, a non-GAAP measure - see "Explanation of Certain Unaudited Non-GAAP Financial Measures" for more information and a reconciliation to GAAP.

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

All yields and rates have been computed on an annual basis using amortized cost.

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Noninterest Income

Noninterest income totaled $23.7 million for the third quarter of 2024, an increase of $1.5 million, or 7%, compared to the second quarter of 2024 and an increase of $5.9 million, or 33%, from the third quarter of 2023.

Noninterest income totaled $66.4 million for the nine months ended September 30, 2024, an increase of $4.5 million, or 7%, compared to the nine months ended September 30, 2023.

Noninterest income totaled $22.2 million for the first quarter of 2025, an increase of $5.1 million, or 30%, compared to the fourth quarter of 2024 and an increase of $1.7 million, or 8%, from the first quarter of 2024.

Noninterest income is detailed as follows:

Third Second Third Nine Months Ended

Quarter Quarter Quarter September 30,

First Fourth First

Quarter Quarter Quarter

(In thousands) 2025 2024 2024

4 unchanged sentences

Insurance agency income 1,620 1,151 1,291

SBA gains 391 694 613 1,824 1,184

BOLI income 2,468 2,627 2,264

3 unchanged sentences

Total $ 22,180 $ 17,068 $ 20,497

Service charges on deposits were $5.4 million in the third quarter of 2024, compared to $5.3 million in the second quarter of 2024, and $4.6 million in the third quarter of 2023.

For the nine months ended September 30, 2024, service charges on deposits totaled $15.7 million, an increase of $2.3 million, or 17%, compared to the nine months ended September 30, 2023.

The Company’s investments in talent and market expansion across the state have resulted in continued growth in treasury management services to commercial customers.

Interchange income remained flat compared to the second quarter of 2024 and increased $0.2 million, or 13%, compared to the third quarter of 2023.

The increase from the prior year quarter reflects continued organic growth.

For the nine months ended September 30, 2024, interchange income totaled $5.7 million, a decrease of $5.7 million, or 50%, compared to the nine months ended September 30, 2023, due to the impact of the Durbin amendment, which became effective for the Company on July 1, 2023.

Wealth management income, including trust fees and brokerage commissions and fees, was $3.8 million in both the second and third quarters of 2024, compared to $3.1 million for the third quarter of 2023.

For the nine months ended September 30, 2024, wealth management income totaled $11.1 million, an increase of $1.6 million, or 17%, compared to the nine months ended September 30, 2023.

The wealth management division continues to demonstrate success in building relationships, and assets under management have increased $276.5 million, or 16%, from December 31, 2023, to $2.0 billion at September 30, 2024.

Insurance agency income was similar to the second quarter of 2024 and totaled $1.4 million for the three months ended September 30, 2024, compared to $1.2 million in the third quarter of 2023.

For the nine months ended September 30, 2024, insurance agency income totaled $4.0 million, an increase of $0.6 million, or 17%, compared to the nine months ended September 30, 2023, reflecting continued growth and expansion of insurance services.

Bank owned life insurance (“BOLI”) income of $2.6 million for the third quarter of 2024 was consistent with the second quarter of 2024 and increased $0.4 million, or 17%, from $2.2 million for the third quarter of 2023.

For the nine months ended September 30, 2024, BOLI income totaled $7.4 million, an increase of $1.3 million, or 20%, compared to the nine months ended September 30, 2023, with policy exchanges executed in the first quarter of 2024 resulting in improved ongoing yields.

Other income was $7.5 million in the third quarter of 2024, an increase of $1.5 million, or 26%, compared to the second quarter of 2024, and an increase of $3.2 million, or 74%, compared to the third quarter of 2023.

For the nine months ended September 30, 2024, other income totaled $18.6 million, an increase of $3.0 million, or 19%, compared to the nine months ended September 30, 2023.

Service charges on deposits were $5.2 million in the first quarter of 2025, compared to $5.1 million in the fourth quarter of 2024, and $5.0 million in the first quarter of 2024.

The Company’s investments in talent and market expansion across Florida have resulted in continued growth in treasury management services to commercial customers.

Interchange income remained flat compared to the fourth quarter of 2024 and decreased $0.1 million, or 4%, compared to the first quarter of 2024.

Wealth management income, including trust fees and brokerage commissions and fees, was $4.2 million in the first quarter of 2025, compared to $4.0 million in the fourth quarter of 2024, and $3.5 million for the first quarter of 2024.

The wealth management division continues to demonstrate success in building relationships, and assets under management have increased $74.0 million, or 4%, from December 31, 2024, to $2.1 billion at March 31, 2025.

Insurance agency income totaled $1.6 million in the first quarter of 2025, compared to $1.2 million in the fourth quarter of 2024, and $1.3 million in the first quarter of 2024, reflecting seasonally strong results and continued growth in the business.

BOLI income totaled $2.5 million for the first quarter of 2025, a decrease of $0.2 million, or 4%, compared to the fourth quarter of 2024, and an increase of $0.2 million, or 9%, compared to the first quarter of 2024.

Other income was $6.3 million in the first quarter of 2025, a decrease of $4.1 million, or 39%, compared to the fourth quarter of 2024, and an increase of $0.3 million, or 5%, compared to the first quarter of 2024.

Changes in each period reflect variability in income from SBIC investments, loan swap-related fees, and other fees correlating with growth in customers and accounts.

Net securities activity resulted in gains of $0.2 million during the third quarter of 2024, losses of $44 thousand in the second quarter of 2024 , and losses of $0.4 million in the third quarter of 2023.

For the nine months ended September 30, 2024, net securities activity resulted in gains of $0.4 million, compared to losses of $0.5 million for the nine months ended September 30, 2023.

The first quarter of 2024 included gains of $4.1 million on the sale of the Company’s holdings of Visa Class B stock, which were largely offset by losses of $3.8 million on the sale of $86.8 million, or 3%, of the bank’s investment securities portfolio.

The proceeds were reinvested at a yield of 5.53%, with an expected earnback on the trade of 1.9 years.

In October 2024, the Company took advantage of favorable market conditions and repositioned a portion of its available for sale securities portfolio.

Securities with an average book yield of 2.8% were sold, resulting in a pre-tax loss of approximately $8.0 million impacting fourth quarter 2024 results.

The proceeds of approximately $113.0 million were reinvested in agency mortgage-backed securities with an average book yield of 5.4%, for an estimated earnback of less than three years.

Net securities activity resulted in gains of $0.2 million during the first quarter of 2025, losses of $8.4 million in the fourth quarter of 2024 , and gains of $0.2 million in the first quarter of 2024.

The fourth quarter of 2024 included the strategic repositioning of a portion of the AFS securities portfolio.

Noninterest Expenses

Noninterest expense for the third quarter of 2024 totaled $84.8 million, an increase of $2.3 million, or 3%, compared to the second quarter of 2024, and a decrease of $9.1 million, or 10%, from the third quarter of 2023.

For the nine months ended September 30, 2024, noninterest expense totaled $257.7 million, a decrease of $51.5 million, or 17%, compared to the nine months ended September 30, 2023.

The decreases from 2023 are the result of cost-saving initiatives and prudent management of expenses, while maintaining strategic investments to support continued growth.

Noninterest expense for the first quarter of 2025 totaled $90.6 million, an increase of $5.0 million, or 6%, compared to the fourth quarter of 2024, and an increase of $0.2 million from the first quarter of 2024.

Seacoast continues to prudently manage expenses while strategically investing to support continued growth.

Noninterest expenses are detailed as follows:

Third Second Third Nine Months Ended

Quarter Quarter Quarter September 30,

First Fourth First

Quarter Quarter Quarter

(In thousands) 2025 2024 2024

8 unchanged sentences

Amortization of intangibles 5,309 5,587 6,292

Other real estate owned expense and net (gain) loss on sale 491 (109) 274 356 412

OREO expense and net loss (gain) on sale 241 84 (26)

Provision for credit losses on unfunded commitments 150 250 250

Merger-related charges 1,051 — —

Other 7,073 5,976 6,532

Total $ 90,597 $ 85,575 $ 90,371

Salaries and wages totaled $40.7 million for the third quarter of 2024, $38.9 million for the second quarter of 2024, and $46.4 million for the third quarter of 2023.

The third quarter of 2024 reflects continued additions to the banking team as the Company focuses on organic growth.

For the nine months ended September 30, 2024, salaries and wages totaled $119.9 million, a decrease of $19.3 million, or 14%, compared to the nine months ended September 30, 2023.

A workforce reduction in early 2024 partially offset revenue compression from higher interest rates.

During the third quarter of 2024, employee benefits, which include costs associated with the Company’s self-funded health insurance benefits, 401(k) plan, payroll taxes, and unemployment compensation, were $7.0 million, an increase of $0.1 million, or 1%, compared to the second quarter of 2024, and a decrease of $0.3 million, or 3%, compared to the third quarter of 2023.

For the nine months ended September 30, 2024, employee benefit costs totaled $21.7 million, a decrease of $1.5 million, or 7%, compared to the nine months ended September 30, 2023.

The decreases compared to the 2023 periods are related to reductions in the workforce.

Salaries and wages totaled $42.2 million for the first quarter of 2025, $42.4 million for the fourth quarter of 2024, and $40.3 million for the first quarter of 2024.

The first quarter of 2025 reflects the successful recruiting and onboarding of banking teams and talent across our footprint.

During the first quarter of 2025, the Company added 10 revenue producing bankers to the team.

During the first quarter of 2025, employee benefits, which include costs associated with the Company’s self-funded health insurance benefits, 401(k) plan, payroll taxes, and unemployment compensation, were $8.9 million, an increase of $2.3 million, or 35%, compared to the fourth quarter of 2024, and an increase of $1.0 million, or 12%, compared to the first quarter of 2024.

The increase compared to the fourth quarter of 2024 reflects higher seasonal payroll taxes and 401(k) contributions.

The Company utilizes third parties for its core data processing systems.

Ongoing data processing costs are directly related to the number of transactions processed and the negotiated rates associated with those transactions.

Outsourced data processing costs totaled $8.0 million, $8.2 million, and $8.7 million for the third quarter of 2024, second quarter of 2024, and third quarter of 2023, respectively.

Lower expenses in the third quarter of 2024 reflect the benefit of lower negotiated rates with key service providers.

For the nine months ended September 30, 2024, outsourced data processing costs totaled $28.3 million, a decrease of

$15.2 million, or 35%, compared to the nine months ended September 30, 2023.

The 2023 period included $17.5 million in costs directly associated with bank acquisitions.

Total occupancy and furniture and equipment expenses were $9.2 million in the third quarter of 2024, $9.1 million in the second quarter of 2024, and $9.8 million in the third quarter of 2023.

The decrease in expenses compared to the third quarter of 2023 is the result of expense reduction efforts completed during 2024.

For the nine months ended September 30, 2024, occupancy and furniture and equipment expenses totaled $28.3 million, a decrease of $2.7 million, or 9%, compared to the nine months ended September 30, 2023.

Marketing expenses totaled $2.7 million in the third quarter of 2024, $3.3 million in the second quarter of 2024, and $1.9 million in the third quarter of 2023.

For the nine months ended September 30, 2024, marketing expenses totaled $8.7 million, an increase of $2.5 million, or 40%, compared to the nine months ended September 30, 2023.

Planned investments in branding and in marketing campaigns across the state led to higher marketing expenses in 2024, with changes between periods driven by the timing of various campaigns.

Legal and professional fees for the third quarter of 2024 were $2.7 million, an increase of $0.7 million, or 37%, compared to the second quarter of 2024, and similar to expenses in the third quarter of 2023.

For the nine months ended September 30, 2024, legal and professional fees totaled $6.8 million, a decrease of $7.4 million, or 52%, compared to the nine months ended September 30, 2023.

The 2023 period included $6.5 million in costs directly associated with bank acquisitions.

Outsourced data processing costs totaled $8.5 million, $8.3 million, and $12.1 million for the first quarter of 2025, fourth quarter of 2024, and first quarter of 2024, respectively.

Total occupancy and furniture and equipment expenses were $9.5 million in the first quarter of 2025, $9.2 million in the fourth quarter of 2024, and $10.0 million in the first quarter of 2024.

During the quarter, the Company opened two new branch locations.

Marketing expenses totaled $2.7 million in the first quarter of 2025, $2.1 million in the fourth quarter of 2024, and $2.7 million in the first quarter of 2024.

Changes between periods are primarily associated with the timing of various campaigns to support customer growth initiatives.

Legal and professional fees for the first quarter of 2025 were $2.7 million, a decrease of $0.1 million, or 2%, compared to the fourth quarter of 2024, and an increase of $0.6 million, or 27%, compared to the first quarter of 2024.

Provision for Credit Losses

The provision for credit losses was $6.3 million for the third quarter of 2024, compared to $4.9 million for the second quarter of 2024, and $2.7 million for the third quarter of 2023.

For the nine months ended September 30, 2024, provision for credit losses was $12.6 million, compared to $33.5 million for the nine months ended September 30, 2023.

The first quarter of 2023 included a $26.6 million day-one provision recorded in conjunction with the Professional acquisition.

Excluding the day-one provision, the increase for the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023 was primarily due to loan growth.

In late September and early October 2024, communities across our corporate footprint were impacted by Hurricanes Helene and Milton.

We maintained uninterrupted digital and telephone access for our customers and, having experienced minimal impacts to our branch properties, we fully reopened to serve our communities shortly after each storm passed.

Recovery efforts in many areas continue and the full impacts on people and businesses in the most hard-hit regions are not fully known.

We do not expect a significant impact from Hurricane Helene, but an additional provision for credit losses may be warranted in the fourth quarter of 2024 for the impacts of Hurricane Milton, in a range between approximately $5 million and $10 million.

For the third quarter of 2024, the Company recorded tax expense of $8.6 million, a decrease of $0.3 million, or 3%, compared to the second quarter of 2024 and a decrease of $0.5 million, or 5%, compared to the third quarter of 2023.

The effective tax rate for the third quarter of 2024 was 21.9%, compared to 22.4% in the second quarter of 2024 and 22.8% in the third quarter of 2023.

For the nine months ended September 30, 2024, tax expense totaled $25.3 million, an increase of $3.4 million, or 15%, compared to the nine months ended September 30, 2023, with an effective tax rate of 22.6% for the nine months ended September 30, 2024, compared to 22.8% for the nine months ended September 30, 2023.

The provision for credit losses was $9.3 million for the first quarter of 2025, compared to $3.7 million for the fourth quarter of 2024, and $1.4 million for the first quarter of 2024.

The increase in provision in the first quarter of 2025 reflects higher loan growth and recent heightened volatility in macroeconomic conditions.

Allowance coverage of 1.34% remains flat compared to December 31, 2024.

For the first quarter of 2025, the Company recorded tax expense of $9.4 million, a decrease of $0.1 million, or 1%, compared to the fourth quarter of 2024 and an increase of $1.6 million, or 20%, compared to the first quarter of 2024.

The effective tax rate for the first quarter of 2025 was 23.0%, compared to 21.8% in the fourth quarter of 2024 and 23.1% in the first quarter of 2024.

Explanation of Certain Unaudited Non-GAAP Financial Measures

This report contains financial information determined by methods other than Generally Accepted Accounting Principles (“GAAP”).

The financial highlights provide reconciliations between GAAP and adjusted financial measures including net income, fully taxable equivalent net interest income, noninterest income, noninterest expense, tax adjustments, net interest margin and other financial ratios.

This report contains financial information determined by methods other than GAAP.

The financial highlights provide reconciliations between GAAP and adjusted financial measures including net income, FTE net interest income, noninterest income, noninterest expense, tax adjustments, net interest margin and other financial ratios.

Management uses these non-GAAP financial measures in its analysis of the Company’s performance and believes these presentations provide useful supplemental information, and a clearer understanding of the Company’s performance.

5 unchanged sentences

Reconciliation of Non-GAAP Measures

Third Second Third Nine Months Ended

Quarter Quarter Quarter September 30,

First Fourth First

Quarter Quarter Quarter

(Amounts in thousands, except per share data) 2025 2024 2024

2 unchanged sentences

Securities (gains) losses, net (196) 8,388 (229)

BOLI benefits on death (included in other income) — — — — (2,117)

Total adjustments to noninterest income (196) 8,388 (229)

2 unchanged sentences

Merger-related charges (1,051) — —

Business continuity expenses - hurricane events — (280) —

Branch reductions and other expense initiatives — — (7,094)

— — (3,305) (7,094) (5,167)

Adjustments to noninterest expense (1,051) (280) (7,094)

Adjusted noninterest expense $ 89,546 $ 85,295 $ 83,277

$ 84,818 $ 82,537 $ 90,610 $ 250,632 $ 270,908

Income taxes $ 9,386 $ 9,513 $ 7,830

2 unchanged sentences

Adjusted net income $ 32,102 $ 40,556 $ 31,132

$ 30,511 $ 30,277 $ 34,170 $ 91,920 $ 101,878

Earnings per diluted share, as reported $ 0.37 $ 0.40 $ 0.31

3 unchanged sentences

Provision for credit losses on unfunded commitments (150) (250) (250)

Other real estate owned expense and net (gain) loss on sale (491) 109 (274) (356) (412)

OREO expense and net (gain) loss on sale (241) (84) 26

Amortization of intangibles (5,309) (5,587) (6,292)

6 unchanged sentences

Impact of FTE adjustment 340 311 220

Adjusted net revenue on a fully taxable equivalent basis $ 130,467 $ 126,885 $ 137,685 $ 382,918 $ 438,162

Adjusted net revenue on a FTE basis $ 140,841 $ 141,571 $ 125,566

Adjusted efficiency ratio 59.53 % 56.07 % 61.13 %

2 unchanged sentences

Net interest income including FTE adjustment 118,857 116,115 105,298

Third Second Third Nine Months Ended

Quarter Quarter Quarter September 30,

(Amounts in thousands, except per share data) 2024 2024 2023 2024 2023

Total noninterest income 22,180 17,068 20,497

1 unchanged sentence

Pre-tax pre-provision earnings 50,590 47,858 35,674

First Fourth First

Quarter Quarter Quarter

(Amounts in thousands, except per share data) 2025 2024 2024

Total adjustments to noninterest income (196) 8,388 (229)

Total adjustments to noninterest expense including other real estate owned expense and net (gain) loss on sale 491 (109) 3,579 7,450 38,759

Total adjustments to noninterest expense including OREO expense and net (gain) loss on sale 1,292 364 7,068

Adjusted pre-tax pre-provision earnings $ 51,686 $ 56,610 $ 42,513

$ 46,390 $ 44,490 $ 47,349 $ 133,393 $ 168,905

Average assets $ 15,395,642 $ 15,204,041 $ 14,690,776

2 unchanged sentences

Return on average assets (ROA) 0.83 % 0.89 % 0.71 %

Impact of other adjustments for adjusted net income 0.02 0.17 0.14

Adjusted ROA 0.85 1.06 0.85

Return on average assets 0.83 0.89 0.71

Impact of removing average intangible assets and related amortization 0.15 0.17 0.18

1 unchanged sentence

Impact of other adjustments for adjusted net income 0.02 0.18 0.15

Adjusted return on average tangible assets 0.98 % 1.00 % 1.12 % 1.01 % 1.15 %

Pre-tax pre-provision return on average tangible assets 1.46 % 1.45 % 1.43 % 1.38 % 1.49 %

Impact of adjustments on pre-tax pre-provision earnings 0.01 — 0.12 0.06 0.36

Adjusted pre-tax pre-provision return on average tangible assets 2

1.47 % 1.45 % 1.55 % 1.44 % 1.85 %

Adjusted ROTA 1.00 % 1.24 % 1.04 %

Average shareholders’ equity $ 2,214,995 $ 2,203,052 $ 2,118,381

5 unchanged sentences

Impact of other adjustments for adjusted net income 0.18 1.84 1.60

Adjusted return on average tangible common equity 10.27 % 10.76 % 12.79 % 10.72 % 13.14 %

Adjusted ROTCE 10.35 % 12.74 % 11.15 %

Loan interest income 1

10 unchanged sentences

$ 118,857 $ 116,115 $ 105,298

Third Second Third Nine Months Ended

Quarter Quarter Quarter September 30,

(Amounts in thousands, except per share data) 2024 2024 2023 2024 2023

Accretion on acquired loans (8,221) (11,717) (10,595)

8 unchanged sentences

$ 29,422 $ 26,986 $ 22,434

Fully taxable equivalent adjustment to securities (8) (7) (22) (22) (71)

Securities interest income excluding fully taxable equivalent adjustment $ 25,997 $ 24,188 $ 21,498 $ 72,612 $ 61,842

First Fourth First

Quarter Quarter Quarter

(Amounts in thousands, except per share data) 2025 2024 2024

FTE adjustment to securities (7) (7) (7)

Securities interest income excluding FTE adjustment $ 29,415 $ 26,979 $ 22,427

Loan interest income 1

150,973 152,303 147,308

Fully taxable equivalent adjustment to loans (302) (226) (177) (741) (517)

Loan interest income excluding fully taxable equivalent adjustment $ 150,980 $ 147,292 $ 149,871 $ 445,367 $ 433,304

FTE adjustment to loans (333) (304) (213)

Loan interest income excluding FTE adjustment 150,640 151,999 147,095

Net interest income 1

118,857 116,115 105,298

Fully taxable equivalent adjustments to securities (8) (7) (22) (22) (71)

Fully taxable equivalent adjustments to loans (302) (226) (177) (741) (517)

Net interest income excluding fully taxable equivalent adjustments $ 106,665 $ 104,424 $ 119,306 $ 316,167 $ 377,421

1 Includes severance, contract termination costs, disposition of branch premises and fixed assets, and other costs to effect the Company’s branch consolidation and other expense reduction strategies.

2 As of 1Q’24, amortization of intangibles is excluded from adjustments to noninterest expense;

prior periods have been updated to reflect the change.

3 On a fully taxable equivalent basis.

FTE adjustments to securities (7) (7) (7)

FTE adjustments to loans (333) (304) (213)

Net interest income excluding FTE adjustments $ 118,517 $ 115,804 $ 105,078

1 On a FTE basis.

All yields and rates have been computed using amortized cost.

Financial Condition

Total assets as of September 30, 2024 were $15.2 billion, an increase of $588.1 million, or 4%, from December 31, 2023.

Total assets as of March 31, 2025 were $15.7 billion, an increase of $556.2 million, or 4%, from December 31, 2024.

Information related to yields, maturities, carrying values and fair value of the Company’s securities is set forth in “Note 3 – Securities” in this report.

At September 30, 2024, the Company had $2.2 billion in AFS securities and $646.1 million in HTM securities.

At March 31, 2025, the Company had $2.6 billion in AFS securities and $624.7 million in HTM securities.

The Company’s total debt securities portfolio increased $390.9 million from December 31, 2024.

During the first quarter of 2024, the Company recognized a $4.1 million gain on the opportunistic sale of its Visa Class B shares.

The gain was offset by a partial repositioning of the securities portfolio, in which $86.8 million of securities were sold, with $3.8 million in realized losses.

The first quarter of 2025 included strategic purchases in connection with the announcement of the Heartland acquisition.

The Company purchased $412 million in AFS securities at a 5.7% taxable equivalent yield, which were funded with FHLB borrowings at a weighted-average rate of 4.3% until the expected date of acquisition close.

Debt securities generally return principal and interest monthly.

The modified duration of the AFS securities portfolio and the total portfolio was 4.1 and 4.5, respectively, at September 30, 2024 compared to 4.5 and 4.9, respectively, at December 31, 2023.

At September 30, 2024, AFS securities had gross unrealized losses of $179.0 million and gross unrealized gains of $13.8 million, compared to gross unrealized losses of $217.7 million and gross unrealized gains of $4.4 million at December 31, 2023.

The modified duration of the AFS securities portfolio and the total portfolio was 4.7 and 5.0, respectively, at March 31, 2025 compared to 4.7 and 4.9, respectively, at December 31, 2024.

At March 31, 2025, AFS securities had gross unrealized losses of $183.5 million and gross unrealized gains of $11.7 million, compared to gross unrealized losses of $211.3 million and gross unrealized gains of $3.5 million at December 31, 2024.

The credit quality of the Company’s securities holdings is primarily investment grade.

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The collateral underlying these mortgages are primarily pooled multifamily loans.

The Company also has invested $286.0 million in floating rate collateralized loan obligations.

Collateralized loan obligations are special purpose vehicles that purchase first lien broadly syndicated corporate loans while providing support to senior tranche investors.

As of September 30, 2024, all of the Company’s collateralized loan obligations were in AAA/AA tranches with weighted average credit support of 34%.

The Company also has invested $265.5 million in floating rate CLOs.

CLOs are special purpose vehicles that purchase first lien broadly syndicated corporate loans while providing support to senior tranche investors.

As of March 31, 2025, all of the Company’s CLOs were in AAA/AA tranches with weighted-average credit support of 32%.

The Company utilizes credit models with assumptions of loan level defaults, recoveries, and prepayments to evaluate each security for potential credit losses.

1 unchanged sentence

HTM securities consist solely of mortgage-backed securities and collateralized mortgage obligations guaranteed by U.S.

government-sponsored entities, each of which is expected to recover any price depreciation over its holding period as the debt securities move to maturity.

government-sponsored entities, 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 through other sources if needed, and has the intent and ability to hold these investments to maturity.

At September 30, 2024, the Company has determined that all debt securities in an unrealized loss position are the result of both broad investment type spreads and the current interest rate environment.

At March 31, 2025, the Company has determined that all debt securities in an unrealized loss position are the result of both broad investment type spreads and the current interest rate environment.

Management believes that each investment will recover any price depreciation over its holding period as the debt securities move to maturity, and management has the intent and ability to hold these investments to maturity if necessary.

Therefore, at September 30, 2024, no allowance for credit losses has been recorded.

Therefore, at March 31, 2025, no allowance for credit losses has been recorded.

Loan Portfolio

Loans, net of unearned income and excluding the allowance for credit losses, were $10.2 billion at September 30, 2024, a $142.3 million, or 1.4%, increase from December 31, 2023.

Loans, net of unearned income and excluding the allowance for credit losses, were $10.4 billion at March 31, 2025, an increase of $143.1 million, or 5.6% annualized, from December 31, 2024.

The Company remains committed to sound risk management procedures.

Portfolio diversification in terms of asset mix, industry, and loan type has been and continues to be an important element of the Company’s lending strategy.

The average loan size is $360 thousand, and the average commercial loan size is $789 thousand at September 30, 2024, reflecting the Company’s longtime focus on granularity and on creating valuable customer relationships.

The average loan size is $426 thousand, and the average commercial loan size is $838 thousand at March 31, 2025, reflecting the Company’s longtime focus on granularity and on creating valuable customer relationships.

Lending policies contain guardrails that pertain to lending by type of collateral and purpose, along with limits regarding loan concentrations and the principal amount of loans.

The Company’s exposure to commercial real estate lending remains well below regulatory limits (see “Loan Concentrations”).

The following tables detail loan portfolio composition at September 30, 2024 and December 31, 2023 for portfolio loans, purchased credit deteriorated (“PCD”) and loans purchased which are not considered purchased credit deteriorated (“Non-PCD”) as defined in “Note 4 - Loans”.

September 30, 2024

(In thousands) Portfolio Loans Acquired Non-PCD Loans PCD Loans Total

The following tables detail loan portfolio composition at March 31, 2025 and December 31, 2024 for portfolio loans, purchased credit deteriorated loans and loans purchased which are not considered credit deteriorated (“Non-PCD”) as defined in “Note 4 - Loans.”

March 31, 2025

(In thousands) Portfolio Loans Acquired Non-PCD Loans PCD Loans Total % to Total Loans

Construction and land development $ 559,883 $ 58,076 $ 534 $ 618,493 6 %

6 unchanged sentences

December 31, 2024

(In thousands) Portfolio Loans Acquired Non-PCD Loans PCD Loans Total

(In thousands) Portfolio Loans Acquired Non-PCD Loans PCD Loans Total % to Total Loans

Construction and land development $ 568,148 $ 79,370 $ 535 $ 648,053 6 %

5 unchanged sentences

Totals $ 7,452,172 $ 2,669,695 $ 178,083 $ 10,299,950 100 %

The amortized cost basis of loans included net deferred costs of $44.9 million at September 30, 2024 and $43.1 million at December 31, 2023.

At September 30, 2024, the remaining fair value adjustments on acquired loans were $141.8 million, or 4.5%, of the outstanding acquired loan balances, compared to $174.0 million, or 4.8%, of the acquired loan balances at December 31, 2023.

The amortized cost basis of loans included net deferred costs of $47.0 million at March 31, 2025 and $43.9 million at December 31, 2024.

At March 31, 2025, the remaining fair value adjustments on acquired loans were $119.5 million, or 4.3%, of the outstanding acquired loan balances, compared to $128.1 million, or 4.3%, of the acquired loan balances at December 31, 2024.

The discount is accreted into interest income over the remaining lives of the related loans on a level yield basis.

Collateral types and characteristics of non-owner occupied commercial real estate (“CRE”) loans as of September 30, 2024 were as follows:

September 30, 2024

(In thousands)

Balance Balance % of Total Loans Average Loan Size 30+ Days Past Due-Accruing Non Accrual Weighted Avg LTV 1

Retail $ 1,135,452 11.1 % $ 2,248 $ 324 $ — 50 %

Office 561,984 5.5 1,678 — 2,914 54

Multifamily 5+ 458,588 4.5 2,259 — 3,189 51

Hotel/Motel 363,324 3.6 3,707 3,341 15,684 49

Industrial/Warehouse 429,894 4.2 2,128 2,554 195 54

Other 623,834 6.1 1,147 2,377 6,724 51

Total $ 3,573,076 35.0 % $ 1,893 $ 8,596 $ 28,706 51 %

1 Loan-to-value is calculated based on the real estate value at the time of origination, renewal, or update, whichever is more recent.

Non-owner occupied CRE loans increased by $253.2 million in the nine months ended September 30, 2024, totaling $3.6 billion at September 30, 2024 compared to $3.3 billion at December 31, 2023.

Construction and land development loans decreased $29.6 million, or 5%, totaling $618.5 million at March 31, 2025, compared to December 31, 2024.

These loans, extended to both commercial and consumer customers, are collateralized by and for the

purpose of funding land development and construction projects.

Repayment is from the proceeds of the sale, refinancing or permanent financing of the property.

Commercial real estate owner occupied loans totaled $1.7 billion at March 31, 2025, an increase of $27.0 million, or 2% compared to December 31, 2024.

Commercial real estate owner occupied loans are extended to commercial customers for the purpose of acquiring or refinancing real estate to be occupied by the borrower's business.

These loans are collateralized by the subject property and the repayment of these loans is largely dependent on the performance of the company occupying the property.

Commercial real estate non-owner occupied loans increased $9.6 million, totaling $3.5 billion at March 31, 2025 compared to $3.5 billion at December 31, 2024.

Non-owner occupied CRE loans are collateralized by properties where the source of repayment is typically from the sale or lease of the property.

Within the non-owner occupied CRE portfolio, the largest segment is Retail properties, which totaled approximately $1.1 billion at September 30, 2024.

Within the non-owner occupied CRE portfolio, the largest segment is Retail properties, which totaled approximately $1.2 billion at March 31, 2025, with an average loan size of $2.4 million.

This segment targets grocery or credit tenant-anchored shopping plazas, single credit tenant retail buildings, smaller outparcels, and other small retail units.

Loans in this segment have a weighted average loan to value of 50% and an average loan size of $2.2 million.

The second-largest segment in the non-owner occupied CRE portfolio is office properties, which totaled $562.0 million at September 30, 2024.

This segment targets low to mid-rise suburban offices and is broadly diversified across many types of professional services.

There is limited exposure to central business districts.

Loans in this segment have a weighted average loan to value of 54% and an average loan size of $1.7 million.

Owner-occupied CRE loans increased by $6.5 million in the nine months ended September 30, 2024 to $1.7 billion.

Owner-occupied CRE is used by the owner, where the primary source of repayment is the cash flow from business operations housed within the property.

Commercial and financial loans are extended to commercial customers for working capital, physical asset expansion, asset acquisition or other business purposes.

Balances decreased $32.7 million, or 2%, from December 31, 2023, totaling $1.6 billion at September 30, 2024.

Residential mortgage loans increased $119.2 million to $2.6 billion during the nine months ended September 30, 2024.

Included in the balance as of September 30, 2024, were $981.3 million of fixed rate mortgages, $981.1 million of adjustable rate mortgages and $602.5 million in home equity loans and home equity lines of credit (“HELOCs”), compared to $1.0 billion, $865.2 million and $488.2 million, respectively, at December 31, 2023.

Substantially all residential originations have been underwritten to conventional loan agency standards, including loan balances that exceed agency value limitations.

The average LTV of our HELOC portfolio is 64%, with 32% of the loans being in first lien position at September 30, 2024, compared to an average LTV of 63%, with 35% of the portfolio being in the first lien position at December 31, 2023.

The Company also provides consumer loans, which include installment loans, auto loans, marine loans, and other consumer loans, which decreased $32.1 million, or 13%, to total $219.5 million at September 30, 2024, compared to $251.6 million at December 31, 2023.

The second-largest segment in the non-owner occupied CRE portfolio is office properties, which totaled $550.7 million at March 31, 2025, an average loan size of $1.7 million.

This segment targets low to mid-rise suburban offices and is broadly diversified across many types of professional services, with limited exposure to central business districts.

Other non-owner occupied CRE loans include $473.7 million in loans collateralized by industrial or warehouse properties, $405.2 million collateralized by multi-family residential properties, $323.5 million collateralized by hotels or motels, and $580.1 million collateralized by other property types, including restaurants, schools and recreation centers.

Residential real estate loans increased $36.2 million to $2.7 billion during the three months ended March 31, 2025.

Included in the balance as of March 31, 2025, were $1.0 billion of fixed rate mortgages, $1.0 billion of adjustable rate mortgages and $619.3 million in home equity loans and HELOCs, compared to $1.0 billion, $970.2 million and $614.7 million, respectively, at December 31, 2024.

Substantially all residential mortgage originations have been underwritten to conventional loan agency standards, including loan balances that exceed agency value limitations.

The average LTV of our HELOC portfolio is 63%, with 31% of the loans being in first lien position at March 31, 2025, compared to an average LTV of 64%, with 31% of the portfolio being in the first lien position at December 31, 2024.

Commercial and financial loans increased $101.7 million, or 6%, from December 31, 2024, totaling $1.8 billion at March 31, 2025.

The purpose of these loans may be to provide working capital, asset acquisition or for other business purposes, and are generally supported by projected cash flows of the business, collateralized by business assets, and/or guaranteed by the business owners.

The Company continues to exercise a disciplined approach to lending and is benefiting from the investments made in recent years to attract talent from large regional banks across its markets.

This talent is onboarding significant new relationships, resulting in increased loan production.

The Company also provides consumer loans, which include installment loans, auto loans, marine loans, and other consumer loans, which decreased $1.9 million, or 1%, to total $191.4 million at March 31, 2025, compared to $193.3 million at December 31, 2024.

Loan production and late-stage pipelines (loans in underwriting and approval or approved and not yet closed) are detailed in the following table for the periods specified.

Pipelines include lines of credit at the full proposed commitment amount, which may not result in fully funded originations.

Third Second Third

First Fourth First

Quarter Quarter Quarter

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Consumer originations 46,732 42,607 48,244

Commercial and commercial real estate originations during the third quarter of 2024 were $499.7 million, an increase of $93.7 million, or 23%, compared to the second quarter of 2024, and an increase of $405.6 million, or 431%, compared to the third quarter of 2023.

Commercial and commercial real estate originations during the first quarter of 2025 were $405.4 million, a decrease of $306.1 million, or 43%, compared to the fourth quarter of 2024, and an increase of $145.4 million, or 56%, compared to the first quarter of 2024.

Commercial and commercial real estate pipelines were $884.9 million as of March 31, 2025, an increase of $279.5 million, or 46%, from $605.4 million at December 31, 2024, and an increase of $386.3 million, or 77% from $498.6 million at March 31, 2024.

The Company continues to exercise a disciplined approach to lending and is benefiting from the investments made in recent years to attract talent from large regional banks across its markets.

This talent is onboarding significant new relationships, resulting in increased loan production.

Commercial and commercial real estate pipelines were $744.5 million as of September 30, 2024, an increase of $0.8 million from $743.8 million at June 30, 2024, and an increase of 187% from $259.4 million at September 30, 2023.

SBA originations totaled $18.4 million during the third quarter of 2024, an increase of $10.2 million compared to the second quarter of 2024, and an increase of $5.9 million compared to the third quarter of 2023.

Residential loans originated for sale in the secondary market totaled $23.2 million in the third quarter of 2024, compared to $21.4 million in the second quarter of 2024 and $17.6 million in the third quarter of 2023.

Residential saleable pipelines were $11.2 million as of September 30, 2024, compared to $12.1 million as of June 30, 2024 and $6.8 million as of September 30, 2023.

Residential loan production retained in the portfolio for the third quarter of 2024 was $51.5 million, compared to $42.4 million in the second quarter of 2024 and $44.0 million in the third quarter of 2023.

The pipeline of residential loans intended to be retained in the portfolio was $21.9 million as of September 30, 2024, compared to $24.7 million as of June 30, 2024, and $20.9 million as of September 30, 2023.

Consumer originations, which include HELOCs, totaled $65.1 million during the third quarter of 2024, compared to $60.0 million in the second quarter of 2024 and $76.5 million in the third quarter of 2023.

The consumer pipeline was $24.4 million as of September 30, 2024, compared to $24.5 million as of June 30, 2024 and $24.5 million at September 30, 2023.

SBA originations totaled $17.4 million during the first quarter of 2025, a decrease of $19.4 million compared to the fourth quarter of 2024, and a decrease of $1.6 million compared to the first quarter of 2024.

Residential loans originated for sale in the secondary market totaled $15.5 million in the first quarter of 2025, compared to $11.8 million in the fourth quarter of 2024 and $15.3 million in the first quarter of 2024.

Residential saleable pipelines were $15.5 million as of March 31, 2025, compared to $6.7 million as of December 31, 2024 and $9.3 million as of March 31, 2024.

Residential loan production retained in the portfolio for the first quarter of 2025 was $70.3 million, compared to $99.9 million in the fourth quarter of 2024 and $51.4 million in the first quarter of 2024.

The pipeline of residential loans intended to be retained in the portfolio was $37.5 million as of March 31, 2025, compared to $35.1 million as of December 31, 2024, and $24.4 million as of March 31, 2024.

Consumer originations, which include HELOCs, totaled $46.7 million during the first quarter of 2025, compared to $42.6 million in the fourth quarter of 2024 and $48.2 million in the first quarter of 2024.

The consumer pipeline was $24.4 million as of March 31, 2025, compared to $17.4 million as of December 31, 2024 and $25.1 million at March 31, 2024.

Loan Concentrations

The Company has developed guardrails to manage loan types that are most impacted by stressed market conditions to minimize credit risk concentration to capital.

Outstanding balances for commercial and commercial real estate loan relationships greater than $10 million totaled $2.6 billion, representing 26% of the total portfolio at September 30, 2024, compared to $2.3 billion, or 23%, at December 31, 2023.

The Company’s ten largest commercial and commercial real estate funded and unfunded relationships at September 30, 2024 aggregated to $550.7 million, of which $441.4 million was funded, compared to $505.7 million at December 31, 2023, of which $348.3 million was funded.

Outstanding balances for commercial and commercial real estate loan relationships greater than $10 million totaled $2.8 billion, representing 27% of the total portfolio at March 31, 2025, compared to $2.7 billion, or 26%, at December 31, 2024.

The Company’s ten largest commercial and commercial real estate funded and unfunded relationships at March 31, 2025 aggregated to $540.8 million, of which $463.3 million was funded, compared to $547.5 million at December 31, 2024, of which $433.0 million was funded.

Concentrations in construction and land development loans and CRE loans are maintained well below regulatory guidelines.

Construction and land development and CRE loan concentrations as a percentage of subsidiary bank total risk based capital were 36% and 241%, respectively, at September 30, 2024, compared to 48% and 244%, respectively, at December 31, 2023.

Construction and land development and CRE loan concentrations as a percentage of subsidiary bank total risk based capital

were 36% and 236%, respectively, at March 31, 2025, compared to 38% and 237%, respectively, at December 31, 2024.

Regulatory guidance suggests limits of 100% and 300%, respectively.

On a consolidated basis, construction and land development and commercial real estate loans represent 34% and 227%, respectively, of total consolidated risk based capital as of September 30, 2024 compared to 45% and 228%, respectively, at December 31, 2023.

On a consolidated basis, construction and land development and commercial real estate loans represent 34% and 220%, respectively, of total consolidated risk based capital as of March 31, 2025 compared to 36% and 224%, respectively, at December 31, 2024.

To determine these ratios, the Company defines CRE in accordance with the guidance on “Concentrations in Commercial Real Estate Lending” (the “Guidance”) issued by the federal bank regulatory agencies in 2006 (and reinforced in 2015), which defines CRE loans as exposures secured by land development and construction, including 1-4 family residential construction, multi-family property, and non-farm nonresidential property where the primary or a significant source of repayment is derived from rental income associated with the property (i.e., loans for which 50 percent or more of the source of repayment comes from third party, non-affiliated, rental income) or the proceeds of the sale, refinancing, or permanent financing of the property.

Loans to real estate investment trusts (“REITs”) and unsecured loans to developers that closely correlate to the inherent risks in CRE markets would also be considered CRE loans under the Guidance.

Loans to REITs and unsecured loans to developers that closely correlate to the inherent risks in CRE markets would also be considered CRE loans under the Guidance.

Loans on owner-occupied CRE are generally excluded.

In addition, the Company is subject to a geographic concentration of credit because it primarily operates in Florida.

Nonperforming Loans, Troubled Borrower Modifications, Other Real Estate Owned and Credit Quality

Nonperforming assets (“NPAs”) at September 30, 2024 totaled $87.3 million, and were comprised of $80.9 million of nonaccrual loans, and $6.4 million of other real estate owned (“OREO”), including $5.7 million of branches taken out of service.

Overall, NPAs increased $14.6 million, or 20%, from $72.7 million as of December 31, 2023.

NPAs to total assets at September 30, 2024 increased to 0.58% from 0.50% at December 31, 2023.

Compared to December 31, 2023, nonaccrual loans increased $15.8 million, or 24%.

Approximately 75% of nonaccrual loans were secured with real estate at September 30, 2024.

Nonperforming loans to total loans outstanding at September 30, 2024 increased to 0.79% from 0.65% at December 31, 2023.

Nonperforming Loans, Troubled Borrower Modifications, OREO and Credit Quality

NPAs at March 31, 2025 totaled $78.2 million, and were comprised of $71.0 million of nonaccrual loans, and $7.2 million of OREO, including $5.4 million of branches taken out of service.

Overall, NPAs decreased $20.7 million, or 21%, from $98.9 million as of December 31, 2024.

NPAs to total assets at March 31, 2025 decreased to 0.50% from 0.65% at December 31, 2024.

Compared to December 31, 2024, nonaccrual loans decreased $21.4 million, or 23%.

Approximately 69% of nonaccrual loans were secured with real estate at March 31, 2025.

Nonperforming loans to total loans outstanding at March 31, 2025 decreased to 0.68% from 0.90% at December 31, 2024.

A significant portion of nonaccrual loans have collateral values well in excess of balances outstanding, and therefore, no loss is expected.

The tables below set forth details related to nonaccrual loans.

September 30, 2024

(In thousands) Nonaccrual Loans With No Related Allowance Nonaccrual Loans With an Allowance Total Nonaccrual Loans Allowance for Credit Losses

March 31, 2025

(In thousands) Nonaccrual Loans With No Related Allowance Nonaccrual Loans With an Allowance Total Nonaccrual Loans

Construction and land development $ 492 $ 622 $ 1,114

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December 31, 2024

(In thousands) Nonaccrual Loans With No Related Allowance Nonaccrual Loans With an Allowance Total Nonaccrual Loans Allowance for Credit Losses

(In thousands) Nonaccrual Loans With No Related Allowance Nonaccrual Loans With an Allowance Total Nonaccrual Loans

Construction and land development $ 492 $ 660 $ 1,152

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The loan carrying value is analyzed and any changes are appropriately made quarterly, as described above.

In certain circumstances, the Company provides modifications of loans to borrowers experiencing financial difficulty, which the Company refers to as troubled borrower modifications (“TBMs”).

Loans that were modified as TBMs during the nine months ended September 30, 2024 are included in “Note 4 - Loans”.

In certain circumstances, the Company provides modifications of loans to borrowers experiencing financial difficulty, which the Company refers to as TBMs.

Loans that were modified as TBMs during the three months ended March 31, 2025 are included in “Note 4 - Loans”.

Allowance for Credit Losses on Loans

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Expected credit losses are estimated over the contractual term of the loans, adjusted for expected prepayments.

The Company recorded provision expense of $6.3 million and $12.6 million, respectively, for the three and nine months ended September 30, 2024, compared to $2.7 million and $33.5 million, respectively, for the three and nine months ended September 30, 2023.

The Company recorded net charge-offs of $7.4 million and $21.0 million, respectively, in the three and nine months ended September 30, 2024, compared to $12.7 million and $16.6 million, respectively, for the three and nine months ended September 30, 2023.

The ratio of allowance for credit losses to total loans was 1.38% at September 30, 2024, 1.47% at December 31, 2023, and 1.49% at September 30, 2023.

The ratio of allowance for credit losses to total loans was 1.34% at March 31, 2025, 1.34% at December 31, 2024, and 1.47% at March 31, 2024.

Cash and Cash Equivalents and Liquidity Risk Management

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Cash flows from operations are a significant component of liquidity risk management and the Company considers both deposit maturities and the scheduled cash flows from loan and investment maturities and payments when managing risk.

Cash and cash equivalents, including interest bearing deposits, totaled $637.1 million at September 30, 2024, compared to $447.2 million at December 31, 2023.

Higher cash and cash equivalent balances at September 30, 2024 are consistent with the Company’s strategic balance sheet management.

Cash and cash equivalents, including interest bearing deposits, totaled $500.6 million at March 31, 2025, compared to $476.6 million at December 31, 2024.

Deposits are a primary source of liquidity.

The stability of this funding source is affected by numerous factors, including returns available to customers on alternative investments, the quality of customer service levels, perception of safety and competitive forces.

Total uninsured deposits were estimated to be $4.3 billion at September 30, 2024, representing 36% of overall deposit accounts.

Total uninsured deposits were estimated to be $4.7 billion at March 31, 2025, representing 37% of overall deposit accounts.

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 31% of total deposits at September 30, 2024.

Excluding such balances, the uninsured and uncollateralized deposits were 31% of total deposits at March 31, 2025.

The Company has liquidity sources as discussed below, including cash and lines of credit with the FRB and FHLB, that represent 136% of uninsured deposits, and 162% of uninsured and uncollateralized deposits.

In addition to $637.1 million in cash and cash equivalents at September 30, 2024, the Company had $5.7 billion in available borrowing capacity, including $4.1 billion in available collateralized lines of credit, $1.2 billion of unpledged debt securities available as collateral for potential additional borrowings, and available unsecured lines of credit of $348.0 million.

In addition to $500.6 million in cash and cash equivalents at March 31, 2025, the Company had $5.8 billion in available borrowing capacity, including $3.7 billion in available collateralized lines of credit, $1.7 billion of unpledged debt securities available as collateral for potential additional borrowings, and available unsecured lines of credit of $348.0 million.

The Company may also access funding by acquiring brokered deposits.

Brokered deposits at September 30, 2024 totaled $256.5 million, compared to $122.3 million at December 31, 2023.

Brokered deposits at March 31, 2025 totaled $262.5 million, compared to $293.6 million at December 31, 2024.

Contractual maturities for assets and liabilities are reviewed to meet current and expected future liquidity requirements.

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The Company has traditionally relied upon dividends from Seacoast Bank and securities offerings to provide funds to pay the Company’s expenses and to service the Company’s debt.

During the third quarter of 2024, Seacoast Bank distributed $15.4 million to the Company and, at September 30, 2024, is eligible to distribute dividends to the Company of approximately $172.1 million without prior regulatory approval.

At September 30, 2024, the Company had cash and cash equivalents at the parent of approximately $97.4 million, compared to $101.7 million at December 31, 2023.

During the first quarter of 2025, Seacoast Bank distributed $34.9 million to the Company.

At March 31, 2025, the Company had cash and cash equivalents at the holding company of approximately $114.5 million, compared to $95.8 million at December 31, 2024.

Deposits and Borrowings

Customer relationship funding is detailed in the following table for the periods specified:

September 30, December 31,

March 31, December 31,

(In thousands, except ratios) 2025 2024

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Time deposits 1,395,911 1,371,522

Brokered deposits $ 256,536 $ 122,347

Brokered time certificates 262,461 244,351

Total deposits $ 12,574,796 $ 12,242,427

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$ 12,513,463 $ 12,180,860

Noninterest demand deposits as % of total deposits 28 % 30 %

Noninterest demand deposit mix 28 % 27 %

1 Total deposits and securities sold under agreements to repurchase, excluding brokered deposits.

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The Company benefits from a diverse and granular deposit base that serves as a significant source of strength.

Total deposits increased $466.7 million, or 4.0%, to $12.2 billion at September 30, 2024 compared to December 31, 2023.

Noninterest demand deposits represented 28% and 30% of total deposits at September 30, 2024 and December 31, 2023, respectively.

Customer transaction account balances (noninterest demand and interest-bearing demand) represented 49% of total deposits at September 30, 2024, compared to 54% at December 31, 2023.

Customer sweep accounts totaled $210.2 million at September 30, 2024, decreasing $164.4 million, or 44%, from December 31, 2023.

Total deposits increased $332.4 million, or 11% annualized, to $12.6 billion at March 31, 2025 compared to December 31, 2024.

Noninterest demand deposits represented 28% of total deposits at March 31, 2025, and 27% of total deposits at December 31, 2024.

Customer transaction account balances (noninterest demand and interest-bearing demand) represented 50% of total deposits at both March 31, 2025 and December 31, 2024.

Customer repurchase agreements totaled $201.1 million at March 31, 2025, decreasing $30.9 million, or 13%, from December 31, 2024.

Repurchase agreements are offered by Seacoast to select customers who wish to sweep excess balances on a daily basis for investment purposes.

At September 30, 2024 and December 31, 2023, long-term debt included $72.4 million and $72.2 million, respectively, related to trust preferred securities issued by trusts organized or acquired by the Company.

At September 30, 2024, the average interest rate in effect on our outstanding subordinated debt related to trust preferred securities was 6.80%, compared to 7.34% at December 31, 2023.

At March 31, 2025 and December 31, 2024, long-term debt included $72.6 million and $72.5 million, respectively, related to trust preferred securities issued by trusts organized or acquired by the Company.

At March 31, 2025, the average interest rate in effect on our outstanding subordinated debt related to trust preferred securities was 6.29%, compared to 6.34% at December 31, 2024.

All trust preferred securities are guaranteed by the Company on a junior subordinated basis.

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The Company believes that its trust preferred securities qualify under these capital rules.

In 2022, the Company acquired $12.3 million in senior debt through the acquisition of Apollo Bancshares, Inc.

Contractual interest is paid on a semiannual basis at a fixed rate of 5.50% until April 30, 2025, at which point the rate converts to a floating rate of 3-month SOFR plus 533 basis points.

The debt was recorded at fair value, resulting in a $0.4 million premium that is being amortized into interest expense over the remaining term to maturity.

In 2023, the Company acquired $25.0 million in subordinated debt through the acquisition of Professional that qualifies as Tier 2 Capital.

Contractual interest is paid on a semiannual basis at a fixed interest rate of 3.375% until January 30, 2027, at which point the rate converts to a 3-month SOFR rate plus 203 basis points paid quarterly.

The debt was recorded at fair value, resulting in a $3.9 million discount that is being accreted into interest expense over the remaining term to maturity.

Federal Home Loan Bank advances totaled $245.0 million at September 30, 2024 with a weighted average interest rate of 4.19%, compared to $50.0 million at December 31, 2023 with an interest rate of 3.23%.

In 2022, the Company acquired $12.3 million in senior debt through the acquisition of Apollo.

Contractual interest is paid on a semiannual basis at a fixed rate of 5.50% until October 30, 2025, at which point the rate converts to a floating rate of 3-month SOFR plus 533 basis points until maturity in 2030.

The debt was recorded at fair value, resulting in a $0.4 million premium that is being amortized into interest expense over the remaining term to maturity.

FHLB advances totaled $465.0 million at March 31, 2025 with a weighted-average interest rate of 4.26%, compared to advances outstanding of $245.0 million at December 31, 2024 with a weighted-average interest rate of 4.19%.

In the first quarter of 2025, the Company utilized short-term fixed-rate advances to fund securities purchases.

Off-Balance Sheet Transactions

In the normal course of business, the Company may engage in a variety of financial transactions that, under generally accepted accounting principles, either are not recorded on the balance sheet or are recorded on the balance sheet in amounts that differ from the full contract or notional amounts.

In the normal course of business, the Company may engage in a variety of financial transactions that, under GAAP, either are not recorded on the balance sheet or are recorded on the balance sheet in amounts that differ from the full contract or notional amounts.

These transactions involve varying elements of market, credit and liquidity risk.

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These instruments are not recorded on the balance sheet until funds are advanced under the commitment.

Unfunded commitments to extend credit were $2.8 billion at September 30, 2024 and $2.7 billion at December 31, 2023.

Unfunded commitments to extend credit were $2.9 billion at March 31, 2025 and $2.9 billion at December 31, 2024.

In the normal course of business, the Company and Seacoast Bank enter into agreements, or are subject to regulatory agreements that result in cash, debt and dividend restrictions.

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Seacoast Bank may be required to maintain reserve balances with the FRB.

There was no reserve requirement at September 30, 2024 or December 31, 2023.

There was no reserve requirement at March 31, 2025 or December 31, 2024.

Under FRB regulation, Seacoast Bank is limited as to the amount it may loan to its affiliates, including the Company, unless such loans are collateralized by specified obligations.

At September 30, 2024, the maximum amount available for transfer from Seacoast Bank to the Company in the form of loans approximated $196.1 million, if the Company has sufficient acceptable collateral.

There were no loans made to affiliates during the nine months ended September 30, 2024.

At March 31, 2025, the maximum amount available for transfer from Seacoast Bank to the Company in the form of loans approximated $194.9 million, if the Company has sufficient acceptable collateral.

There were no loans made to affiliates during the three months ended March 31, 2025.

Capital Resources

The Company’s equity capital at September 30, 2024 increased $85.8 million, or 4%, from December 31, 2023 to $2.2 billion.

Changes in equity included an increase from net income of $86.9 million, partially offset by the payment of common stock dividends totaling $46.2 million.

The ratio of shareholders’ equity to period end total assets was 14.46% at both September 30, 2024 and December 31, 2023, respectively.

The ratio of tangible shareholders’ equity to tangible assets was 9.64% and 9.31% at September 30, 2024 and December 31, 2023, respectively.

The Company’s equity capital at March 31, 2025 increased $46.5 million, or 2%, from December 31, 2024 to $2.2 billion.

Changes in equity included increases from net income, and an improvement in accumulated other comprehensive loss due to increases in the value of AFS securities associated with changes in interest rates, partially offset by the payment of common stock dividends.

The ratio of shareholders’ equity to period end total assets was 14.17% and 14.39% at March 31, 2025 and December 31, 2024, respectively.

The ratio of tangible shareholders’ equity to tangible assets was 9.58% and 9.60% at March 31, 2025 and December 31, 2024, respectively.

Changes in the value of HTM securities are not reflected in shareholders’ equity under GAAP;

however, illustratively, if all HTM securities were presented at fair value, the tangible common equity ratio would have been 9.11% at September 30, 2024 and 8.68% at December 31, 2023.

Activity in shareholders’ equity for the nine months ended September 30, 2024 and 2023 follows:

however, illustratively, if all HTM securities were presented at fair value, the tangible common equity ratio would have been 9.07% at March 31, 2025 and 8.96% at December 31, 2024.

Activity in shareholders’ equity for the three months ended March 31, 2025 and 2024 follows:

(In thousands) 2025 2024

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Common stock transactions related to stock-based employee benefit plans 289 813

Issuance of common stock and conversion of options pursuant to acquisition — 421,042

Repurchase of common stock (880) (45)

Dividends on common stock ($0.18 per share and $0.18 per share, respectively)

1 unchanged sentence

Change in accumulated other comprehensive income 27,147 (4,078)

Ending balance at September 30, 2024 and 2023

Ending balance at March 31, 2025 and 2024

$ 2,229,740 $ 2,117,750

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The capital measures are not necessarily comparable to similar capital measures that may be presented by other companies and Seacoast does not nor should investors consider such non-GAAP financial measures in isolation from, or as a substitute for GAAP financial information (see “Note 8 – Regulatory Capital”).

September 30, 2024 Seacoast

March 31, 2025 Seacoast

(Consolidated) Seacoast

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Tier 1 Capital Ratio 14.70 13.85 8.00

Common Equity Tier 1 Ratio (CET1) 14.10 14.05 6.50

CET1 Ratio 14.06 13.85 6.50

Leverage Ratio 11.15 10.51 5.00

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The Company is a legal entity separate and distinct from Seacoast Bank and its other subsidiaries, and the Company’s primary source of cash and liquidity, other than securities offerings and borrowings, is dividends from its bank subsidiary.

Without Office of the Comptroller of the Currency (“OCC”) approval, Seacoast Bank can pay $172.1 million of dividends to the Company.

The OCC and the Federal Reserve have policies that encourage banks and bank holding companies to pay dividends from current earnings, and have the general authority to limit the dividends paid by national banks and bank holding companies, respectively, if such payment may be deemed to constitute an unsafe or unsound practice.

Without OCC approval, Seacoast Bank can pay $127.9 million of dividends to the Company.

The OCC and the Federal Reserve have policies that encourage banks and BHCs to pay dividends from current earnings, and have the general authority to limit the dividends paid by national banks and BHCs, respectively, if such payment may be deemed to constitute an unsafe or unsound practice.

If, in the particular circumstances, either of these federal regulators determined that the payment of dividends would constitute an unsafe or unsound banking practice, either the OCC or the Federal Reserve may, among other things, issue a cease and desist order prohibiting the payment of dividends by Seacoast Bank or us, respectively.

The board of directors of a bank holding company must consider different factors to ensure that its dividend level, if any, is prudent relative to the organization’s financial position and is not based on overly optimistic earnings scenarios such as any potential events that may occur before the payment date that could affect its ability to pay, while still maintaining a strong financial position.

As a general matter, the FRB has indicated that the board of directors of a bank holding company, such as Seacoast, should consult with the FRB and eliminate, defer, or significantly reduce the bank holding company’s dividends if:

The board of directors of a BHC must consider different factors to ensure that its dividend level, if any, is prudent relative to the organization’s financial position and is not based on overly optimistic earnings scenarios such as any potential events that may occur before the payment date that could affect its ability to pay, while still maintaining a strong financial position.

As a general matter, the FRB has indicated that the board of directors of a BHC, such as Seacoast, should consult with the FRB and eliminate, defer, or significantly reduce the BHC’s dividends if:

(i) its net income available to shareholders for the past four quarters, net of dividends previously paid during that period, is not sufficient to fully fund the dividends;

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Senior management regularly reviews the overall interest rate risk position and evaluates strategies to manage the risk.

The Company's Asset and Liability Management Committee (“ALCO”) uses simulation analysis to monitor changes in net interest income due to changes in market interest rates.

The Company's Asset and Liability Management Committee uses simulation analysis to monitor changes in net interest income due to changes in market interest rates.

The simulation of rising, declining and flat interest rate scenarios allows management to monitor and adjust interest rate sensitivity to assess the impact of market interest rate swings.

The analysis of the impact on net interest income over a twelve-month period is subjected to instantaneous changes in market rates and is monitored at least quarterly.

The following table presents the ALCO simulation model’s projected impact of a change in interest rates on the projected baseline net interest income for the 12 and 24 month periods beginning October 1, 2024, holding all balances on the balance sheet static.

The following table presents the ALCO simulation model’s projected impact of a change in interest rates on the projected baseline net interest income for the 12 and 24 month periods beginning April 1, 2025, holding all balances on the balance sheet static.

It is important to note that the results in the table below assume parallel shifts in the yield curve and do not take into account changes in the slope of the yield curve nor changes in balance sheet size or mix.

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Net Interest Income

September 30, 2024

March 31, 2025

Change in Interest Rates 1-12 months 13-24 months

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+2.00% (11.2)% (7.2)%

+1.00% (5.2)% (3.0)%

Current —% —%

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-2.00% 7.1% (0.3%)

-3.00% 10.3% (1.3%)

The computations of interest rate risk do not necessarily include certain actions management may undertake to manage this risk in response to changes in interest rates.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis