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Press Release

Seacoast Reports Record Third Quarter 2019 Earnings Results

Company Release - 10/24/2019 4:02 PM ET

Net Income Increased 57% Year-Over-Year to $25.6 Million

Improved Operating Leverage and Strong Performance in Both Commercial and Mortgage Banking Highlight 3Q Results

STUART, Fla., Oct. 24, 2019 (GLOBE NEWSWIRE) -- Seacoast Banking Corporation of Florida (“Seacoast” or the "Company”) (NASDAQ: SBCF) today reported third quarter 2019 net income of $25.6 million, or $0.49 per diluted share, up 57% or $9.3 million year-over-year. Seacoast reported third quarter 2019 adjusted net income1 of $27.7 million, or $0.53 per diluted share, an increase of 57% or $10.1 million compared to the third quarter of 2018.

For the third quarter of 2019, return on average tangible assets was 1.61%, return on average tangible shareholders’ equity was 14.7%, and the efficiency ratio was 48.6%, compared to 1.50%, 14.3% and 53.5%, respectively, in the prior quarter and 1.18%, 12.0%, and 57.0%, respectively, in the third quarter of 2018. Adjusted return on average tangible assets1 was 1.67%, adjusted return on average tangible shareholders’ equity1 was 15.3%, and the adjusted efficiency ratio1 was 49.0%, compared to 1.59%, 15.2%, and 51.4%, respectively, in the prior quarter, and 1.22%, 12.4%, and 56.3%, respectively, in the third quarter of 2018.

Dennis S. Hudson, III, Seacoast’s Chairman and CEO, said, "During the third quarter, Seacoast reported a record $25.6 million in net income. Both our mortgage and commercial banking units showed continued momentum in the quarter, with robust loan originations generating disciplined growth in loan outstandings and a new record in mortgage banking fees. We are generating this growth and improving our operating leverage, all while delivering a highly disciplined credit portfolio."

Charles M. Shaffer, Seacoast’s Chief Operating Officer and Chief Financial Officer, said, “We continue to steadily build shareholder value through consistent growth in our tangible book value per share, ending the period at $14.30, an increase of 19% compared to one year prior. Year to date, we have generated 11% operating leverage, with adjusted revenues1 increasing 18%, and adjusted noninterest expenseincreasing 7%, in spite of a more challenging interest rate environment. Despite two reductions in the Federal Reserve overnight rate and a declining 10-year treasury rate, our net interest margin, excluding the discount on purchased loans, decreased only 3 basis points, a testament to the high quality balance sheet we continue to cultivate. This balance sheet is fortified with a robust capital base, strong asset quality, and a prudent liquidity position. We ended the quarter with a tangible common equity ratio of 11.1% supporting our ability to deploy capital for organic growth and opportunistic acquisitions. As the banking and economic cycle continues to mature, Seacoast is committed to maintaining its fortress balance sheet, built around strong capital and strict credit underwriting.”

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

Third Quarter 2019 Financial Highlights

Income Statement

  • Net income was $25.6 million, or $0.49 per diluted share, compared to $23.3 million, or $0.45, for the prior quarter and $16.3 million, or $0.34, for the third quarter of 2018. For the nine months ended September 30, 2019, net income was $71.6 million, or $1.38 per diluted share, compared to $51.3 million, or $1.07, for the nine months ended September 30, 2018. Adjusted net income1 was $27.7 million, or $0.53 per diluted share, compared to $25.8 million, or $0.50, for the prior quarter and $17.6 million, or $0.37, for the third quarter of 2018. For the nine months ended September 30, 2019, adjusted net income1 was $77.8 million, or $1.50 per diluted share, compared to $55.2 million, or $1.15, for the nine months ended September 30, 2018.
  • Net revenues were $74.9 million, an increase of $1.2 million, or 2%, compared to the prior quarter, and an increase of $11.0 million, or 17%, compared to the third quarter of 2018. For the nine months ended September 30, 2019, net revenues were $222.2 million, an increase of $33.4 million, or 18%, compared to the nine months ended September 30, 2018. Adjusted revenues1 were $74.8 million, an increase of $0.6 million, or 1%, from the prior quarter and an increase of $10.9 million, or 17%, from the third quarter of 2018. For the nine months ended September 30, 2019, adjusted revenues1 were $222.6 million, an increase of $33.5 million, or 18%, compared to the nine months ended September 30, 2018.
  • Net interest income totaled $60.9 million, an increase of $0.8 million, or 1%, from the prior quarter and an increase of $9.4 million, or 18%, from the third quarter of 2018. For the nine months ended September 30, 2019, net interest income was $181.9 million, an increase of $30.3 million, or 20%, compared to the nine months ended September 30, 2018.
  • Net interest margin was 3.89% in the third quarter of 2019, 3.94% in the second quarter of 2019 and 3.82% in the third quarter of 2018. Quarter-over-quarter, the yield on loans contracted 10 basis points, the yield on securities contracted 4 basis points, and the cost of deposits decreased 3 basis points. The impact on net interest margin from accretion of purchase discounts on acquired loans was 25 basis points in the third quarter of 2019, compared to 27 basis points in the prior quarter and 18 basis points in the third quarter of 2018. The Federal Reserve reduced the overnight rate twice by 25 basis points during the third quarter and the 10-year treasury rate fell by approximately 30 basis points, resulting in lower new earning asset yields and further declines in our variable rate earning asset portfolios. This was partially offset by our success in lowering the cost of funding, the result of our focus on maintaining deposit pricing discipline.
  • Noninterest income totaled $13.9 million, an increase of $0.4 million, or 3%, compared to the prior quarter and an increase of $1.7 million, or 13%, from the third quarter of 2018. For the nine months ended September 30, 2019, noninterest income was $40.4 million, an increase of $3.0 million, or 8%, compared to the nine months ended September 30, 2018. Changes in noninterest income from the second quarter of 2019 consisted of the following:
    • Mortgage banking fees increased by $0.4 million, reflecting the combination of increased refinance activity due to lower long term rates and a greater focus on generating saleable volume.
    • Interchange income decreased by $0.2 million, reflecting lower customer activity as a result of Hurricane Dorian.
    • Other noninterest income includes a $1.0 million BOLI death benefit.
    • During the quarter, $49.6 million of securities were sold with an average yield of 1.85%, resulting in a loss of $0.9 million. These funds were reinvested at an average yield of 2.65%.
  • The provision for loan losses was $2.3 million compared to $2.6 million in the prior quarter and $5.8 million in the third quarter of 2018.
  • Noninterest expense was $38.6 million, a decrease of $2.4 million, or 6%, compared to the prior quarter, the result of our proven success at disciplined cost control, and an increase of $1.2 million, or 3%, from the third quarter of 2018. For the nine months ended September 30, 2019, noninterest expense was $122.7 million, an increase of $9.9 million, or 9%, compared to the nine months ended September 30, 2018. Changes from the second quarter of 2019 in noninterest expense consisted of the following:
    • Salaries and wages decreased by $0.8 million. The second quarter's results included $1.1 million of one-time severance costs associated with the previously announced expense reduction initiative. Offsetting in the current quarter were additional incentives aligned with driving continued earnings growth.
    • Our continued proactive focus on efficiency and streamlining operations resulted in an additional $1.4 million in operating expense reductions from several expense categories, including $0.4 million in occupancy, $0.4 million in legal and professional fees, $0.3 million in telephone and data lines and $0.3 million in marketing.
    • During the third quarter, the FDIC announced the achievement of their target deposit insurance reserve ratio, resulting in our ability to apply previously awarded credits to our deposit insurance assessment. This resulted in $0.3 million in lower FDIC assessment expense for the quarter. The Company has remaining credits of $1.2 million, which will be applied to future assessments if the FDIC’s reserve ratio remains above the target threshold.
    • In late August, communities across our footprint prepared for the potential landfall of Hurricane Dorian. To ensure the safety of our associates and customers and to maintain uninterrupted digital and telephone access for our customers, we executed on our business continuity plans, transitioned operational activities to our backup facility, and closed our branches and corporate offices for one business day. Florida was ultimately spared a direct hit and our expenses, which were limited to preparing physical locations and to standing up the offsite operations hub, totaled $0.1 million.
  • Seacoast recorded $8.5 million in income tax expense in the third quarter of 2019, compared to $6.9 million in the prior quarter and $4.4 million in the third quarter of 2018. In September 2019, the State of Florida announced a reduction in the corporate income tax rate from 5.5% to 4.458% for the years 2019, 2020 and 2021. This change resulted in additional income tax expense of $1.1 million upon the write down of deferred tax assets affected by the change, offset by a $0.4 million benefit upon adjusting the year-to-date provision to the new statutory tax rate.  Tax benefits related to stock-based compensation were negligible in the third quarter of 2019, compared to $0.1 million in the prior quarter and $0.4 million in the third quarter of 2018.
  • Year to date adjusted revenues1 increased 18% compared to prior year while adjusted noninterest expense1 increased 7%, generating 11% operating leverage.
  • The efficiency ratio was 48.6% compared to 53.5% in the prior quarter and 57.0% in the third quarter of 2018. The adjusted efficiency ratio1 was 49.0% compared to 51.4% in the prior quarter and 56.3% in the third quarter of 2018. The reduction in both ratios was the outcome of our continued focus on streamlining operations, in combination with driving top-line revenue growth.

Balance Sheet

  • At September 30, 2019, the Company had total assets of $6.9 billion and total shareholders' equity of $962.7 million. Book value per share was $18.70 and tangible book value per share was $14.30, compared to $18.08 and $13.65, respectively, at June 30, 2019 and $15.50 and $12.01, respectively, at September 30, 2018. Year-over-year, tangible book value per share increased 19%, evidencing our commitment to building shareholder value.
  • Debt securities totaled $1.2 billion at September 30, 2019, a decrease of $7.5 million compared to the prior quarter and a decrease of $96.1 million from September 30, 2018. During the quarter, $49.6 million of securities were sold, with an average yield of 1.85%, resulting in a loss of $0.9 million. Purchases of securities during the quarter totaled $77.0 million at an average yield of 2.65%.
  • Loans totaled $5.0 billion at September 30, 2019, an increase of $98.2 million, or 2.0%, compared to the prior quarter, and an increase of $927.0 million, or 23%, from September 30, 2018. Changes in total loans consisted of the following:
    • New loan originations of $488 million, compared to $407 million in the prior quarter, resulted in net loan growth in the quarter of 8% on an annualized basis. Excluding the impact of the First Green acquisition in October 2018, loan outstandings have grown 7% year-over-year.
    • Commercial originations during the third quarter of 2019 were $282.2 million, an increase of $125.3 million, or 80%, compared to the second quarter of 2019 and an increase of $151.2 million, or 115%, compared to the third quarter of 2018. Increases in loan production reflect the addition of business bankers across the Company's footprint, solid execution by the legacy banking team, and higher customer loan demand due to lower long term interest rates. The third quarter of 2019 results include the opportunistic purchase of a $52.1 million commercial real estate loan portfolio.
    • Closed residential loans retained in the portfolio for the third quarter of 2019 were $22.4 million, down 57% from the second quarter of 2019 and down 72% from the third quarter of 2018. Closed residential loans sold for the third quarter of 2019 were $80.8 million, up 32% from the second quarter of 2019 and up 45% from the third quarter of 2018.
    • Consumer and small business originations for the third quarter of 2019 were $103.1 million, a decrease of 24% compared to the second quarter of 2019 and a decrease of 18% compared to the third quarter of 2018.
    • We continue to manage carefully the Company's exposure to commercial real estate. Construction and land development and commercial real estate loans remain well below regulatory guidance at 42% and 204% of total bank-level risk based capital, respectively, down from 51% and 205%, respectively, in the second quarter of 2019. On a consolidated basis, construction and land development and commercial real estate loans represent 39% and 191%, respectively, of total consolidated risk based capital.
    • The funded balances of our top 10 and top 20 relationships represented 19% and 33%, respectively, of total consolidated risk based capital, down from 21% and 38% compared to the third quarter of 2018 and down from 32% and 53% compared to the third quarter of 2016. Our largest committed exposure totals $30 million and our average commercial loan size is $350,000.
  • Pipelines (loans in underwriting and approval or approved and not yet closed) increased over the prior quarter, totaling $504.6 million as of September 30, 2019.
    • Commercial pipelines were $359.7 million, an increase of 38% sequentially and 83% compared to the prior year.
    • Retained residential pipelines were $43.4 million, significantly higher than the prior quarter, the result of a test launch of a correspondent mortgage banking channel focused on acquiring mass affluent, affluent and ultra-high net worth Florida customers.
    • Saleable residential pipelines were $35.1 million, a decrease of 25% sequentially and an increase of 94% compared to the prior year. The decrease in the saleable pipeline from the prior quarter reflects slowing refinance activity late in the quarter.
    • Consumer and small business pipelines were $66.3 million, an increase of 1% sequentially and an increase of 11% compared to the prior year.                               
  • Total deposits were $5.7 billion as of September 30, 2019, an increase of $131.9 million, or 2%, sequentially and an increase of $1.0 billion, or 22%, from the prior year.
    • Interest-bearing deposits (interest-bearing demand, savings and money market deposits) increased year-over-year $400.7 million, or 17%, to $2.8 billion, noninterest bearing demand deposits increased $164.2 million, or 11%, to $1.7 billion, and CDs increased $464.7 million, or 62%, to $1.2 billion.
    • Third quarter balances reflect an increase from the prior quarter of $189.4 million in brokered deposits. We continue to actively manage our mix of brokered deposits and advances from the Federal Home Loan Bank to obtain the most advantageous rates.
    • Overall cost of deposits decreased to 73 basis points from 76 basis points in the prior quarter, reflecting the impact of the Federal Reserve's interest rate cuts and our focus on maintaining deposit pricing discipline.
  • Third quarter return on average tangible assets (ROTA) was 1.61%, compared to 1.50% in the prior quarter and 1.18% in the third quarter of 2018. Adjusted ROTA1 was 1.67% compared to 1.59% in the prior quarter and 1.22% in the third quarter of 2018.

Capital

  • Third quarter return on average tangible common equity (ROTCE) was 14.7%, compared to 14.3% in the prior quarter and 12.0% in the third quarter of 2018. Adjusted ROTCE1 was 15.3% compared to 15.2% in the prior quarter and 12.4% in the third quarter of 2018.
  • The tier 1 capital ratio was 14.9%, total capital ratio was 15.5% and the tier 1 leverage ratio was 12.0% at September 30, 2019.
  • Tangible common equity to tangible assets was 11.1% at September 30, 2019, compared to 10.7% at June 30, 2019 and 9.9% at September 30, 2018.

Asset Quality

  • Nonperforming loans to total loans outstanding was 0.52% at September 30, 2019, 0.47% at June 30, 2019, and 0.64% at September 30, 2018.
  • Nonperforming assets to total assets was 0.58% at September 30, 2019, 0.50% at June 30, 2019 and 0.52% at September 30, 2018. Nonperforming assets increased by $5.8 million to $39.6 million in the third quarter of 2019, primarily the result of five customer relationships moving to nonperforming status, all of which are either fully collateralized or previously written down to realizable values.
  • The ratio of allowance for loan losses to total loans was 0.67% at September 30, 2019, 0.69% at June 30, 2019, and 0.83% at September 30, 2018. The ratio of allowance for loan losses to non-acquired loans was 0.84% at September 30, 2019, 0.87% at June 30, 2019, and 0.98% at September 30, 2018.
  • Net charge-offs were $2.1 million or 0.17% of average loans for the third quarter of 2019 compared to $1.8 million, or 0.15% of average loans in the prior quarter.
FINANCIAL HIGHLIGHTS(Unaudited)
(Amounts in thousands except per share data)        
 Quarterly Trends
          
 3Q'19 2Q'19 1Q'19 4Q'18 3Q'18
Selected Balance Sheet Data:         
Total Assets$6,890,645  $6,824,886  $6,783,389  $6,747,659  $5,930,934 
Gross Loans4,986,289  4,888,139  4,828,441  4,825,214  4,059,323 
Total Deposits5,673,141  5,541,209  5,605,578  5,177,240  4,643,510 
          
Performance Measures:         
Net Income$25,605  $23,253  $22,705  $15,962  $16,322 
Net Interest Margin3.89% 3.94% 4.02% 4.00% 3.82%
Average Diluted Shares Outstanding51,935  51,952  52,039  51,237  48,029 
Diluted Earnings Per Share (EPS)$0.49  $0.45  $0.44  $0.31  $0.34 
Return on (annualized):         
Average Assets (ROA)1.49% 1.38% 1.36% 0.96% 1.10%
Average Tangible Assets (ROTA)1.61  1.50  1.48  1.05  1.18 
Average Tangible Common Equity (ROTCE)14.73  14.30  14.86  10.94  12.04 
Efficiency Ratio48.62  53.48  56.55  65.76  57.04 
          
Adjusted Operating Measures1:         
Adjusted Net Income$27,731  $25,818  $24,205  $23,893  $17,626 
Adjusted Diluted EPS0.53  0.50  0.47  0.47  0.37 
Adjusted ROTA1.67% 1.59% 1.50% 1.49% 1.22%
Adjusted ROTCE15.30  15.17  15.11  15.44  12.43 
Adjusted Efficiency Ratio48.96  51.44  55.81  54.19  56.29 
Adjusted Noninterest Expenses as a         
Percent of Average Tangible Assets2.22  2.34  2.55  2.46  2.48 
          
Other Data:         
Market capitalization2$1,303,010  $1,309,158  $1,354,759  $1,336,415  $1,380,275 
Full-time equivalent employees867  852  902  902  835 
Number of ATMs80  81  84  87  86 
Full service banking offices48  49  50  51  49 
Registered online users107,241  104,017  102,274  99,415  94,400 
Registered mobile devices96,384  92,281  87,844  83,151  73,300 
1Non-GAAP measure, see “Explanation of Certain Unaudited Non-GAAP Financial Measures" for more information and a reconciliation to GAAP
2Common shares outstanding multiplied by closing bid price on last day of each period
 

Vision 2020

We remain confident in our ability to achieve our Vision 2020 targets announced in February 2017.

 Vision 2020 Targets
Return on Tangible Assets1.30% +
Return on Tangible Common Equity16% +
Efficiency RatioBelow 50%

Since announcing our Vision 2020 targets in February 2017, we have achieved a compounded annual growth rate in tangible book value per share of 13%, steadily building shareholder value.

Third Quarter Operating Highlights

Modernizing How We Sell

  • During the quarter the Company achieved record commercial and residential loan originations and pipelines are strong entering the fourth quarter.
  • Late in the quarter, the Company began testing a correspondent mortgage banking channel focused on acquiring mass affluent, affluent, and ultra-high net worth Florida customers. Our objective is to acquire customers using this channel and expand the value of these high quality relationships using data driven analytics.
  • Seacoast has partnered with a leading consumer insights firm to capture and analyze feedback from our customers. Program implementation and launch were completed in the third quarter, with the objective of identifying additional customer opportunities.

Lowering Our Cost to Serve

  • In the third quarter of 2019, average deposits per banking center exceeded $118.2 million, up from $94.8 million during the same period last year.
  • Seacoast consolidated one banking center location in the third quarter of 2019, in addition to the two locations consolidated earlier this year.
  • Seacoast has reduced its physical footprint by 20% to meet the evolving needs of customers in the most cost-effective manner. This reduction was achieved ahead of plan due to successful M&A and the repositioning of the banking center network in strategic growth markets.

Driving Improvements in How Our Business Operates

  • Earlier this year Seacoast further enhanced its interactive voice response (IVR) system in its Florida-based Customer Support Center. The system provides customers with additional secure, self-serve options and expedited call routing processes. This investment provides added scalability and elevates the customer experience.
  • Late last year Seacoast launched a large-scale initiative to implement a fully digital loan origination platform across all business banking units. Implementation and launch were completed in the second quarter and full conversion from the legacy system was completed in the third quarter. This investment should lead to further gains in operational efficiency and banker productivity in 2020 and beyond.

Scaling and Evolving Our Culture

  • Seacoast continues to invest in business bankers. In the third quarter Seacoast on-boarded three new bankers, 18 year to date, in order to fully support the strong markets we serve. Seacoast has a robust pipeline of talent entering the fourth quarter of 2019 and will continue to opportunistically add top-tier bankers in the Tampa and South Florida markets.

OTHER INFORMATION

Conference Call Information
Seacoast will host a conference call on October 25, 2019 at 10:00 a.m. (Eastern Time) to discuss the third quarter 2019 earnings results and business trends. Investors may call in (toll-free) by dialing (888) 517-2513 (passcode: 6648 701; host: Dennis S. Hudson). Charts will be used during the conference call and may be accessed at Seacoast's website at www.SeacoastBanking.com by selecting "Presentations" under the heading "News/Events" A replay of the call will be available for one month, beginning late afternoon of October 25, 2019 by dialing (888) 843-7419 (domestic) and using passcode: 6648 701#.

Alternatively, individuals may listen to the live webcast of the presentation by visiting Seacoast's website at www.SeacoastBanking.com. The link is located in the subsection "Presentations" under the heading "Investor Services." Beginning the afternoon of October 25, 2019, an archived version of the webcast can be accessed from this same subsection of the website. The archived webcast will be available for one year.

About Seacoast Banking Corporation of Florida (NASDAQ: SBCF)
Seacoast Banking Corporation of Florida is one of the largest community banks headquartered in Florida with approximately $6.9 billion in assets and $5.7 billion in deposits as of September 30, 2019. The Company provides integrated financial services including commercial and retail banking, wealth management, and mortgage services to customers through advanced banking solutions, and 48 traditional branches of its locally-branded, wholly-owned subsidiary bank, Seacoast Bank. Offices stretch from Fort Lauderdale, Boca Raton and West Palm Beach north through the Daytona Beach area, into Orlando and Central Florida and the adjacent Tampa market, and west to Okeechobee and surrounding counties. More information about the Company is available at www.SeacoastBanking.com.

Cautionary Notice Regarding Forward-Looking Statements
This press release contains "forward-looking statements" within the meaning, and protections, of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including, without limitation, statements about future financial and operating results, cost savings, enhanced revenues, economic and seasonal conditions in our markets, and improvements to reported earnings that may be realized from cost controls, tax law changes, new initiatives and for integration of banks that we have acquired, or expect to acquire, as well as statements with respect to Seacoast's objectives, strategic plans, including Vision 2020, expectations and intentions and other statements that are not historical facts. Actual results may differ from those set forth in the forward-looking statements.

Forward-looking statements include statements with respect to our 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 our control, and which may cause the actual results, performance or achievements of Seacoast to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. You should not expect us to update any forward-looking statements.

All statements other than statements of historical fact could be forward-looking statements. You can identify these forward-looking statements through our use of words such as "may", "will", "anticipate", "assume", "should", "support", "indicate", "would", "believe", "contemplate", "expect", "estimate", "continue", "further", "plan", "point to", "project", "could", "intend", "target" or other similar words and expressions of the future. These forward-looking statements may not be realized due to a variety of factors, including, without limitation: the effects of future economic and market conditions, including seasonality; 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; changes in accounting policies, rules and practices; the risks of changes in interest rates on the level and composition of deposits, loan demand, liquidity and the values of loan collateral, securities, and interest sensitive assets and liabilities; interest rate risks, sensitivities and the shape of the yield curve; uncertainty related to the impact of LIBOR calculations on securities and loans; changes in borrower credit risks and payment behaviors; changes in the availability and cost of credit and capital in the financial markets; changes in the prices, values and sales volumes of residential and commercial real estate; our ability to comply with any regulatory requirements; the effects of problems encountered by other financial institutions that adversely affect us or the banking industry; our concentration in commercial real estate loans; the failure of assumptions and estimates, as well as differences in, and changes to, economic, market and credit conditions; the impact on the valuation of our investments due to market volatility or counterparty payment risk; statutory and regulatory dividend restrictions; increases in regulatory capital requirements for banking organizations generally; the risks of mergers, acquisitions and divestitures, including our ability to continue to identify acquisition targets and successfully acquire desirable financial institutions; changes in technology or products that may be more difficult, costly, or less effective than anticipated; our ability to identify and address increased cybersecurity risks; inability of our risk management framework to manage risks associated with our business; dependence on key suppliers or vendors to obtain equipment or services for our business on acceptable terms; reduction in or the termination of our ability to use the mobile-based platform that is critical to our business growth strategy; the effects of war or other conflicts, acts of terrorism, natural disasters or other catastrophic events that may affect general economic conditions; unexpected outcomes of, and the costs associated with, existing or new litigation involving us; our ability to maintain adequate internal controls over financial reporting; potential claims, damages, penalties, fines and reputational damage resulting from pending or future litigation, regulatory proceedings and enforcement actions; the risks that our deferred tax assets could be reduced if estimates of future taxable income from our operations and tax planning strategies are less than currently estimated and sales of our capital stock could trigger a reduction in the amount of net operating loss carryforwards that we may be able to utilize for income tax purposes; the effects of competition from other commercial banks, thrifts, mortgage banking firms, consumer finance companies, credit unions, securities brokerage firms, insurance companies, money market and other mutual funds and other financial institutions operating in our market areas and elsewhere, including institutions operating regionally, nationally and internationally, together with such competitors offering banking products and services by mail, telephone, computer and the Internet; and the failure of assumptions underlying the establishment of reserves for possible loan losses.

All written or oral forward-looking statements attributable to us are expressly qualified in their entirety by this cautionary notice, including, without limitation, those risks and uncertainties described in our annual report on Form 10-K for the year ended December 31, 2018, under "Special Cautionary Notice Regarding Forward-looking Statements" and "Risk Factors", and otherwise in our SEC reports and filings. Such reports are available upon request from the Company, or from the Securities and Exchange Commission, including through the SEC's Internet website at www.sec.gov.

Charles M. Shaffer
Executive Vice President
Chief Operating Officer
and Chief Financial Officer
(772) 221-7003
Chuck.Shaffer@seacoastbank.com

FINANCIAL HIGHLIGHTS(Unaudited)    
SEACOAST  BANKING  CORPORATION  OF  FLORIDA  AND  SUBSIDIARIES      
  
 Quarterly Trends Nine Months Ended
              
(Amounts in thousands, except ratios and per share data)3Q'19 2Q'19 1Q'19 4Q'18 3Q'18 3Q'19 3Q'18
              
Summary of Earnings             
Net income$25,605  $23,253  $22,705  $15,962  $16,322  $71,563  $51,313 
Adjusted net income127,731  25,818  24,205  23,893  17,626  77,754  55,192 
Net interest income261,027  60,219  60,861  60,100  51,709  182,107  151,856 
Net interest margin2,33.89% 3.94% 4.02% 4.00% 3.82% 3.95% 3.79%
              
Performance Ratios             
Return on average assets-GAAP basis31.49% 1.38% 1.36% 0.96% 1.10% 1.41% 1.17%
Return on average tangible assets-GAAP basis3,41.61  1.50  1.48  1.05  1.18  1.53  1.25 
Adjusted return on average tangible assets1,3,41.67  1.59  1.50  1.49  1.22  1.59  1.29 
              
Return on average shareholders' equity-GAAP basis310.73  10.23  10.47  7.65  8.89  10.48  9.65 
Return on average tangible common equity-GAAP basis3,414.73  14.30  14.86  10.94  12.04  14.63  13.14 
Adjusted return on average tangible common equity1,3,415.30  15.17  15.11  15.44  12.43  15.20  13.54 
Efficiency ratio548.62  53.48  56.55  65.76  57.04  52.85  57.75 
Adjusted efficiency ratio148.96  51.44  55.81  54.19  56.29  52.05  56.88 
Noninterest income to total revenue (excluding securities losses)19.53  18.93  17.45  17.97  19.31  18.64  19.84 
Tangible common equity to tangible assets411.05  10.65  10.18  9.72  9.85  11.05  9.85 
Average loan-to-deposit ratio88.35  87.27  90.55  89.14  86.25  88.70  84.62 
End of period loan-to-deposit ratio88.36  88.53  86.38  93.43  87.77  88.36  87.77 
              
Per Share Data             
Net income diluted-GAAP basis$0.49  $0.45  $0.44  $0.31  $0.34  $1.38  $1.07 
Net income basic-GAAP basis0.50  0.45  0.44  0.32  0.35  1.39  1.09 
Adjusted earnings10.53  0.50  0.47  0.47  0.37  1.50  1.15 
              
Book value per share common18.70  18.08  17.44  16.83  15.50  18.70  15.50 
Tangible book value per share14.30  13.65  12.98  12.33  12.01  14.30  12.01 
Cash dividends declared             
              
              
1Non-GAAP measure - see "Explanation of Certain Unaudited Non-GAAP Financial Measures" for more information and a reconciliation to GAAP.  
2Calculated on a fully taxable equivalent basis using amortized cost.  
3These ratios are stated on an annualized basis and are not necessarily indicative of future periods.  
4The Company defines tangible assets as total assets less intangible assets, and tangible common equity as total shareholders' equity less intangible assets.
5Defined as noninterest expense less amortization of intangibles and gains, losses, and expenses on foreclosed properties divided by net operating revenue (net interest income on a fully taxable equivalent basis plus noninterest income excluding securities gains).
   


CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited)      
SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES        
  
 Quarterly Trends Nine Months Ended
              
(Amounts in thousands, except per share data)3Q'19 2Q'19 1Q'19 4Q'18 3Q'18 3Q'19 3Q'18
              
Interest on securities:             
Taxable$8,802  $8,933  $9,119  $9,528  $9,582  $26,854  $28,332 
Nontaxable131  143  151  200  225  425  684 
Interest and fees on loans63,092  62,288  62,287  59,495  48,713  187,667  140,489 
Interest on federal funds sold and other investments800  873  918  835  634  2,591  1,835 
Total Interest Income72,825  72,237  72,475  70,058  59,154  217,537  171,340 
              
Interest on deposits4,334  4,825  3,873  3,140  2,097  13,032  5,623 
Interest on time certificates6,009  5,724  4,959  3,901  2,975  16,692  7,783 
Interest on borrowed money1,534  1,552  2,869  3,033  2,520  5,955  6,403 
Total Interest Expense11,877  12,101  11,701  10,074  7,592  35,679  19,809 
              
Net Interest Income60,948  60,136  60,774  59,984  51,562  181,858  151,531 
Provision for loan losses2,251  2,551  1,397  2,342  5,774  6,199  9,388 
Net Interest Income After Provision for Loan Losses58,697  57,585  59,377  57,642  45,788  175,659  142,143 
              
Noninterest income:             
Service charges on deposit accounts2,978  2,894  2,697  3,019  2,833  8,569  8,179 
Trust fees1,183  1,147  1,017  1,040  1,083  3,347  3,143 
Mortgage banking fees2,127  1,734  1,115  809  1,135  4,976  3,873 
Brokerage commissions and fees449  541  436  468  444  1,426  1,264 
Marine finance fees152  201  362  185  194  715  1,213 
Interchange income3,206  3,405  3,401  3,198  3,119  10,012  9,137 
BOLI income928  927  915  1,091  1,078  2,770  3,200 
SBA gains569  691  636  519  473  1,896  1,955 
Other3,198  2,503  2,266  2,810  1,980  7,967  5,542 
 14,790  14,043  12,845  13,139  12,339  41,678  37,506 
Securities losses, net(847) (466) (9) (425) (48) (1,322) (198)
Total Noninterest Income13,943  13,577  12,836  12,714  12,291  40,356  37,308 
              
              
Noninterest expenses:             
Salaries and wages18,640  19,420  18,506  22,172  17,129  56,566  48,939 
Employee benefits2,973  3,195  4,206  3,625  3,205  10,374  9,320 
Outsourced data processing costs3,711  3,876  3,845  5,809  3,493  11,432  10,565 
Telephone / data lines603  893  811  602  624  2,307  1,879 
Occupancy3,368  3,741  3,807  3,747  3,214  10,916  9,647 
Furniture and equipment1,528  1,544  1,757  2,452  1,367  4,829  4,292 
Marketing933  1,211  1,132  1,350  1,139  3,276  3,735 
Legal and professional fees1,648  2,033  2,847  3,668  2,019  6,528  6,293 
FDIC assessments56  337  488  571  431  881  1,624 
Amortization of intangibles1,456  1,456  1,458  1,303  1,004  4,370  2,997 
Foreclosed property expense and net (gain)/loss on sale262  (174) (40)   (136) 48  461 
Other3,405  3,468  4,282  4,165  3,910  11,155  13,057 
Total Noninterest Expense38,583  41,000  43,099  49,464  37,399  122,682  112,809 
              
Income Before Income Taxes34,057  30,162  29,114  20,892  20,680  93,333  66,642 
Income taxes8,452  6,909  6,409  4,930  4,358  21,770  15,329 
              
Net Income$25,605  $23,253  $22,705  $15,962  $16,322  $71,563  $51,313 
              
Per share of common stock:             
              
Net income diluted$0.49  $0.45  $0.44  $0.31  $0.34  $1.38  $1.07 
Net income basic0.50  0.45  0.44  0.32  0.35  1.39  1.09 
Cash dividends declared             
              
Average diluted shares outstanding51,935  51,952  52,039  51,237  48,029  51,996  47,903 
Average basic shares outstanding51,473  51,446  51,359  50,523  47,205  51,426  47,108 
              
              


CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)  
SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES     
  
 September 30, June 30, March 31, December 31, September 30,
(Amounts in thousands)2019 2019 2019 2018 2018
          
Assets         
Cash and due from banks$106,349  $97,792  $98,270  $92,242  $101,920 
Interest bearing deposits with other banks25,911  61,987  105,741  23,709  3,174 
Total Cash and Cash Equivalents132,260  159,779  204,011  115,951  105,094 
          
Time deposits with other banks4,579  4,980  8,174  8,243  9,813 
          
Debt Securities:         
Available for sale (at fair value)920,811  914,615  877,549  865,831  923,206 
Held to maturity (at amortized cost)273,644  287,302  295,485  357,949  367,387 
Total Debt Securities1,194,455  1,201,917  1,173,034  1,223,780  1,290,593 
          
Loans held for sale26,768  17,513  13,900  11,873  16,172 
          
Loans4,986,289  4,888,139  4,828,441  4,825,214  4,059,323 
Less: Allowance for loan losses(33,605) (33,505) (32,822) (32,423) (33,865)
Net Loans4,952,684  4,854,634  4,795,619  4,792,791  4,025,458 
          
Bank premises and equipment, net67,873  68,738  70,412  71,024  63,531 
Other real estate owned13,593  11,043  11,921  12,802  4,715 
Goodwill205,286  205,260  205,260  204,753  148,555 
Other intangible assets, net21,318  22,672  23,959  25,977  16,508 
Bank owned life insurance125,277  125,233  124,306  123,394  122,561 
Net deferred tax assets17,168  19,353  24,647  28,954  25,822 
Other assets129,384  133,764  128,146  128,117  102,112 
Total Assets$6,890,645  $6,824,886  $6,783,389  $6,747,659  $5,930,934 
          
Liabilities and Shareholders' Equity         
Liabilities         
Deposits         
Noninterest demand$1,652,927  $1,669,804  $1,676,009  $1,569,602  $1,488,689 
Interest-bearing demand1,115,455  1,124,519  1,100,477  1,014,032  912,891 
Savings528,214  519,732  508,320  493,807  451,958 
Money market1,158,862  1,172,971  1,192,070  1,173,950  1,036,940 
Other time certificates537,183  553,107  539,202  513,312  411,208 
Brokered time certificates458,418  268,998  367,841  220,594  192,182 
Time certificates of more than $250,000222,082  232,078  221,659  191,943  149,642 
Total Deposits5,673,141  5,541,209  5,605,578  5,177,240  4,643,510 
          
Securities sold under agreements to repurchase70,414  82,015  148,005  214,323  189,035 
Federal Home Loan Bank borrowings50,000  140,000  3,000  380,000  261,000 
Subordinated debt71,014  70,944  70,874  70,804  70,734 
Other liabilities63,398  60,479  59,508  41,025  33,824 
Total Liabilities5,927,967  5,894,647  5,886,965  5,883,392  5,198,103 
          
Shareholders' Equity         
Common stock5,148  5,146  5,141  5,136  4,727 
Additional paid in capital784,661  782,928  780,680  778,501  668,711 
Retained earnings168,637  143,032  119,779  97,074  81,112 
Treasury stock(6,079) (6,137) (4,959) (3,384) (2,854)
 952,367  924,969  900,641  877,327  751,696 
Accumulated other comprehensive income/(loss), net10,311  5,270  (4,217) (13,060) (18,865)
Total Shareholders' Equity962,678  930,239  896,424  864,267  732,831 
Total Liabilities & Shareholders' Equity$6,890,645  $6,824,886  $6,783,389  $6,747,659  $5,930,934 
          
Common shares outstanding51,482  51,461  51,414  51,361  47,270 
          
          


CONSOLIDATED QUARTERLY FINANCIAL DATA(Unaudited)
SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES        
  
  
          
(Amounts in thousands)3Q'19 2Q'19 1Q'19 4Q'18 3Q'18
          
Credit Analysis         
Net charge-offs (recoveries) - non-acquired loans$2,106  $1,621  $762  $3,693  $800 
Net charge-offs (recoveries) - acquired loans5  220  201  56  (3)
Total Net Charge-offs (Recoveries)2,111  1,841  963  3,749  797 
          
TDR valuation adjustments$40  $27  $35  $35  $36 
          
Net charge-offs (recoveries) to average loans - non-acquired loans0.17% 0.13% 0.06% 0.32% 0.08%
Net charge-offs (recoveries) to average loans - acquired loans  0.02  0.02     
Total Net Charge-offs (Recoveries) to Average Loans0.17  0.15  0.08  0.32  0.08 
          
Provision for loan losses - non-acquired loans$2,241  $2,326  $1,709  $2,343  $5,640 
Provision for (recapture of) loan losses - acquired loans10  225  (312) (1) 134 
Total Provision for Loan Losses$2,251  $2,551  $1,397  $2,342  $5,774 
          
Allowance for loan losses - non-acquired loans$33,488  $33,393  $32,715  $31,803  $33,188 
Allowance for loan losses - acquired loans117  112  107  620  677 
Total Allowance for Loan Losses$33,605  $33,505  $32,822  $32,423  $33,865 
          
Non-acquired loans at end of period$4,010,299  $3,817,358  $3,667,221  $3,588,251  $3,383,571 
Purchased noncredit impaired loans at end of period962,609  1,057,200  1,147,432  1,222,529  662,701 
Purchased credit impaired loans at end of period13,381  13,581  13,788  14,434  13,051 
Total Loans$4,986,289  $4,888,139  $4,828,441  $4,825,214  $4,059,323 
          
Non-acquired loans allowance for loan losses to non-acquired loans at end of period0.84% 0.87% 0.89% 0.89% 0.98%
Total allowance for loan losses to total loans at end of period0.67  0.69  0.68  0.67  0.83 
Purchase discount on acquired loans at end of period3.76  3.76  3.80  3.86  2.25 
          
End of Period         
Nonperforming loans - non-acquired$20,400  $15,810  $15,423  $15,783  $18,998 
Nonperforming loans - acquired5,644  6,986  6,990  10,693  7,142 
Other real estate owned - non-acquired5,177  66  831  386  418 
Other real estate owned - acquired1,574  1,612  1,725  3,020  1,203 
Bank branches closed included in other real estate owned6,842  9,365  9,365  9,396  3,094 
Total Nonperforming Assets$39,637  $33,839  $34,334  $39,278  $30,855 
          
Restructured loans (accruing)$12,395  $14,534  $14,857  $13,346  $13,797 
          
Nonperforming loans to loans at end of period - non-acquired0.51% 0.41% 0.42% 0.44% 0.56%
Nonperforming loans to loans at end of period - acquired0.58  0.65  0.60  0.86  1.06 
Total Nonperforming Loans to Loans at End of Period0.52  0.47  0.46  0.55  0.64 
          
Nonperforming assets to total assets - non-acquired0.47% 0.37% 0.38% 0.38% 0.38%
Nonperforming assets to total assets - acquired0.11  0.13  0.13  0.20  0.14 
Total Nonperforming Assets to Total Assets0.58  0.50  0.51  0.58  0.52 
          
 September 30, June 30, March 31, December 31, September 30,
Loans2019 2019 2019 2018 2018
          
Construction and land development$326,324  $379,991  $417,565  $443,568  $376,257 
Commercial real estate - owner occupied1,025,040  1,005,876  989,234  970,181  829,368 
Commercial real estate - non-owner occupied1,285,327  1,184,409  1,173,183  1,161,885  897,331 
Residential real estate1,409,946  1,400,184  1,329,166  1,324,377  1,152,640 
Consumer217,366  215,932  206,414  202,881  192,772 
Commercial and financial722,286  701,747  712,879  722,322  610,955 
Total Loans$4,986,289  $4,888,139  $4,828,441  $4,825,214  $4,059,323 
          
          


AVERAGE BALANCES, INTEREST INCOME AND EXPENSES, YIELDS AND RATES 1(Unaudited)      
SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES            
                  
                  
 3Q'19 2Q'19 3Q'18
 Average   Yield/ Average   Yield/ Average   Yield/
(Amounts in thousands)Balance Interest Rate Balance Interest Rate Balance Interest Rate
                  
Assets                 
Earning assets:                 
Securities:                 
Taxable$1,171,393  $8,802  3.01% $1,169,891  $8,933  3.05% $1,284,774  $9,582  2.98%
Nontaxable21,194  164  3.09  24,110  179  2.96  31,411  283  3.60 
Total Securities1,192,587  8,966  3.01  1,194,001  9,112  3.05  1,316,185  9,865  3.00 
                  
Federal funds sold and other investments84,705  800  3.75  91,481  873  3.83  51,255  634  4.91 
                  
Loans, net4,945,953  63,138  5.06  4,841,751  62,335  5.16  4,008,527  48,802  4.83 
                  
Total Earning Assets6,223,245  72,904  4.65  6,127,233  72,320  4.73  5,375,967  59,301  4.38 
                  
Allowance for loan losses(33,997)     (32,806)     (29,259)    
Cash and due from banks88,539      91,160      110,929     
Premises and equipment68,301      69,890      63,771     
Intangible assets227,389      228,706      165,534     
Bank owned life insurance125,249      124,631      121,952     
Other assets121,850      126,180      94,433     
                  
Total Assets$6,820,576      $6,734,994      $5,903,327     
                  
Liabilities and Shareholders' Equity                 
Interest-bearing liabilities:                 
Interest-bearing demand$1,116,434  $1,053  0.37% $1,118,703  $1,150  0.41% $939,527  $426  0.18%
Savings522,831  531  0.40  513,773  586  0.46  444,935  170  0.15 
Money market1,173,042  2,750  0.93  1,179,345  3,089  1.05  1,031,960  1,501  0.58 
Time deposits1,159,272  6,009  2.06  1,089,020  5,724  2.11  779,608  2,975  1.51 
Federal funds purchased and securities sold under agreements to repurchase75,785  300  1.57  91,614  355  1.55  204,097  463  0.90 
Federal Home Loan Bank borrowings68,804  414  2.39  51,571  329  2.56  222,315  1,228  2.19 
Other borrowings70,969  820  4.58  70,903  868  4.91  70,694  829  4.65 
                  
Total Interest-Bearing Liabilities4,187,137  11,877  1.13  4,114,929  12,101  1.18  3,693,136  7,592  0.82 
                  
Noninterest demand1,626,269      1,646,934      1,451,751     
Other liabilities60,500      61,652      30,150     
Total Liabilities5,873,906      5,823,515      5,175,037     
                  
Shareholders' equity946,670      911,479      728,290     
                  
Total Liabilities & Equity$6,820,576      $6,734,994      $5,903,327     
                  
Cost of deposits    0.73%     0.76%     0.43%
Interest expense as a % of earning assets    0.76%     0.79%     0.56%
Net interest income as a % of earning assets  $61,027  3.89%   $60,219  3.94%   $51,709  3.82%
                  
                  
1On a fully taxable equivalent basis. All yields and rates have been computed 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(Unaudited)
SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES        
  
 Nine Months Ended September 30, 2019 Nine Months Ended September 30, 2018
 Average   Yield/ Average   Yield/
(Amounts in thousands, except ratios)Balance Interest Rate Balance Interest Rate
            
Assets           
Earning assets:           
Securities:           
Taxable$1,175,831  $26,854  3.05% $1,323,164  $28,332  2.85%
Nontaxable23,935  533  2.97  32,031  863  3.59 
Total Securities1,199,766  27,387  3.04  1,355,195  29,195  2.87 
            
Federal funds sold and other investments89,084  2,591  3.89  52,253  1,835  4.70 
            
Loans, net4,875,975  187,808  5.15  3,943,617  140,635  4.77 
            
Total Earning Assets6,164,825  217,786  4.72  5,351,065  171,665  4.29 
            
Allowance for loan losses(33,260)     (28,660)    
Cash and due from banks93,171      111,781     
Premises and equipment69,700      64,708     
Intangible assets228,710      166,348     
Bank owned life insurance124,535      121,742     
Other assets128,016      90,888     
            
Total Assets$6,775,697      $5,877,872     
            
Liabilities and Shareholders' Equity           
Interest-bearing liabilities:           
Interest-bearing demand$1,088,605  $3,042  0.37% $979,148  $1,368  0.19%
Savings512,399  1,593  0.42  440,054  392  0.12 
Money market1,170,494  8,397  0.96  1,012,259  3,863  0.51 
Time deposits1,097,308  16,692  2.03  782,283  7,783  1.33 
Federal funds purchased and securities sold under agreements to repurchase117,077  1,206  1.38  186,643  1,071  0.77 
Federal Home Loan Bank borrowings115,337  2,164  2.51  219,652  2,999  1.83 
Other borrowings70,903  2,585  4.87  70,623  2,333  4.42 
            
Total Interest-Bearing Liabilities4,172,123  35,679  1.14  3,690,662  19,809  0.72 
            
Noninterest demand1,628,634      1,446,488     
Other liabilities62,123      29,533     
Total Liabilities5,862,880      5,166,683     
            
Shareholders' equity912,817      711,189     
            
Total Liabilities & Equity$6,775,697      $5,877,872     
            
Cost of deposits    0.72%     0.38%
Interest expense as a % of earning assets    0.77%     0.49%
Net interest income as a % of earning assets  $182,107  3.95%   $151,856  3.79%
            
            
1On a fully taxable equivalent basis. All yields and rates have been computed using amortized cost.
Fees on loans have been included in interest on loans. Nonaccrual loans are included in loan balances.
 


CONSOLIDATED QUARTERLY FINANCIAL DATA  (Unaudited)   
SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES      
  
 September 30, June 30, March 31, December 31, September 30,
(Amounts in thousands)2019 2019 2019 2018 2018
          
Customer Relationship Funding         
Noninterest demand         
Commercial$1,314,102  $1,323,743  $1,298,468  $1,217,842  $1,182,018 
Retail241,734  251,879  275,383  259,318  233,472 
Public funds65,869  65,822  73,640  68,324  42,474 
Other31,222  28,360  28,518  24,118  30,725 
Total Noninterest Demand1,652,927  1,669,804  1,676,009  1,569,602  1,488,689 
          
Interest-bearing demand         
Commercial342,376  323,818  289,544  211,879  167,865 
Retail622,833  634,099  646,522  650,490  655,429 
Public funds150,246  166,602  164,411  151,663  89,597 
Total Interest-Bearing Demand1,115,455  1,124,519  1,100,477  1,014,032  912,891 
          
Total transaction accounts         
Commercial1,656,478  1,647,561  1,588,012  1,429,721  1,349,883 
Retail864,567  885,978  921,905  909,808  888,901 
Public funds216,115  232,424  238,051  219,987  132,071 
Other31,222  28,360  28,518  24,118  30,725 
Total Transaction Accounts2,768,382  2,794,323  2,776,486  2,583,634  2,401,580 
          
Savings528,214  519,732  508,320  493,807  451,958 
          
Money market         
Commercial513,477  517,041  500,649  459,380  423,304 
Retail583,917  590,320  602,378  607,837  524,415 
Public funds61,468  65,610  89,043  106,733  89,221 
Total Money Market1,158,862  1,172,971  1,192,070  1,173,950  1,036,940 
          
Brokered time certificates458,418  268,998  367,841  220,594  192,182 
Other time certificates759,265  785,185  760,861  705,255  560,850 
 1,217,683  1,054,183  1,128,702  925,849  753,032 
Total Deposits$5,673,141  $5,541,209  $5,605,578  $5,177,240  $4,643,510 
          
Customer sweep accounts$70,414  $82,015  $148,005  $214,323  $189,035 
          
          

Explanation of Certain Unaudited Non-GAAP Financial Measures

This presentation contains financial information determined by methods other than Generally Accepted Accounting Principles (“GAAP”). 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. The Company believes the non-GAAP measures enhance investors’ understanding of the Company’s business and performance and if not provided would be requested by the investor community. These measures are also useful in understanding performance trends and facilitate comparisons with the performance of other financial institutions. The limitations associated with operating measures are the risk that persons might disagree as to the appropriateness of items comprising these measures and that different companies might define or calculate these measures differently. The Company provides reconciliations between GAAP and these non-GAAP measures. These disclosures should not be considered an alternative to GAAP.

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GAAP TO NON-GAAP RECONCILIATION (Unaudited)      
SEACOAST  BANKING  CORPORATION  OF  FLORIDA  AND  SUBSIDIARIES          
              
 Quarterly Trends Nine Months Ended
              
(Amounts in thousands, except per share data)3Q'19 2Q'19 1Q'19 4Q'18 3Q'18 3Q'19 3Q'18
              
Net Income$25,605  $23,253  $22,705  $15,962  $16,322  $71,563  $51,313 
              
Total noninterest income13,943  13,577  12,836  12,714  12,291  40,356  37,308 
Securities losses, net847  466  9  425  48  1,322  198 
BOLI benefits on death (included in other income)(956)     (280)   (956)  
Total Adjustments to Noninterest Income(109) 466  9  145  48  366  198 
Total Adjusted Noninterest Income13,834  14,043  12,845  12,859  12,339  40,722  37,506 
              
Total noninterest expense38,583  41,000  43,099  49,464  37,399  122,682  112,809 
Merger related charges    (335) (8,034) (482) (335) (1,647)
Amortization of intangibles(1,456) (1,456) (1,458) (1,303) (1,004) (4,370) (2,997)
Business continuity expenses - hurricane events(95)         (95)  
Branch reductions and other expense initiatives(121) (1,517) (208) (587)   (1,846)  
Total Adjustments to Noninterest Expense(1,672) (2,973) (2,001) (9,924) (1,486) (6,646) (4,644)
Total Adjusted Noninterest Expense36,911  38,027  41,098  39,540  35,913  116,036  108,165 
              
Income Taxes8,452  6,909  6,409  4,930  4,358  21,770  15,329 
Tax effect of adjustments572  874  510  2,623  230  1,956  1,211 
Taxes and tax penalties on acquisition-related BOLI redemption      (485)      
Effect of change in corporate tax rate on deferred tax assets(1,135)         (1,135) (248)
Total Adjustments to Income Taxes(563) 874  510  2,138  230  821  963 
Adjusted Income Taxes7,889  7,783  6,919  7,068  4,588  22,591  16,292 
Adjusted Net Income$27,731  $25,818  $24,205  $23,893  $17,626  $77,754