Slide 1: 1st Quarter 2015 Earnings Call
1st Quarter 2015 Earnings Call April 30, 2015
Slide 2: Cautionary Statement Regarding Forward Looking Statements
Cautionary Statement Regarding Forward Looking Statements Statements included in this report which are not historical in nature are intended to be, and are hereby identified as, forward looking statements for purposes of the safe harbor provided by Section 21E of the Securities Exchange Act of 1934.
Slide 3: 1st Quarter 2015 Highlights
Net Income of $23.9 million $0.99 per diluted share Return on Average Assets 1.23% Return on Average Tangible Equity 16.21% Cash dividend of $0.24 per common share 1st Quarter 2015 Highlights
Slide 4: 1st Quarter 2015 Highlights: Asset Quality and Organic Growth
1st Quarter 2015 Highlights Asset Quality improvement NPA’s 0.89% Net Charge-offs (Recoveries) -0.01% Acquired non-credit impaired Charge-offs 0.56% Strong Organic Growth Loans: 13.7% linked quarter Non-Interest Bearing DDA: up 28.6% linked quarter
Slide 5: 1st Quarter 2015 Highlights: Margin and Non-Interest Income
1st Quarter 2015 Highlights Margin expanded to 4.78% Non Interest Income : $ 26.5 million Deposit Accounts $ 15.7 Mortgage Banking $ 6.6 Wealth Management $ 4.9 Negative Accretion $ (3.2)
Slide 6: Net Interest Margin
Net Interest Margin See Endnotes (1)
Slide 7: Efficiency Ratio
Efficiency Ratio See Endnotes (2)
Slide 8: Operating Earnings Per Share
Operating Earnings Per Share See Endnotes (3)
Slide 9: Branch Initiatives: Consolidation and Sale
CONSOLIDATION Announced consolidation of 14 branch and ATM locations Deposits $208 million Cost savings ~ $4.5 million (annualized) by 2016 One-time Costs $4.5 million Incurred in 2Q & 3Q 2015 Branch Initiatives SALE Branches Loris Little River Loans ~ $7.8 million Deposits ~ $32.0 million Deposit P
Slide 10: Branch Purchase Market Highlights
Acquired 13 branches and 34 ATMs South Carolina 12 Georgia 1 Deposits $580 million Loans $3 million Customers ~ 86,000 Average branch size has ~$45 million in deposits Average branch age ~ 45 years Employees 96 Branch Purchase Market Highlights Counties with Market Overlap: Florence 2 Branches Lexin
Slide 11: Pro Forma Deposit Portfolio
Pro Forma Deposit Portfolio South State Bank Acquired Branches Pro Forma Cost of Total Deposits: 0.12% Cost of Total Deposits: 0.10% Deposit Composition Amount % of Total Demand Deposits $1,757,302 26.5 % NOW Accounts 1,539,977 23.2 Money Market & Savings 2,146,084 32.4 Retail Time Deposits 1,190,29
Slide 12: Transaction Rationale
Transaction Rationale Entrance into 6 new markets Meaningful in-market expansion Strong core deposit funding Strategic Rationale Immediately EPS accretive Low cost funding Mid-single digit accretive in 2016 Internal Rate of Return ~ 30% Attractive Financial Returns Maintain strong pro forma capital
Slide 13: Transaction Terms
Transaction Terms 13 Branches - 12 in Central South Carolina - 1 in Northeast Georgia Branch Purchase $580 million (estimated) Deposits Acquired $7 million (estimated) Fixed Assets $3 million (estimated) Loans Acquired 5.5% Deposit Premium $31.6 million (estimated) Deal Value Customary regulatory ap
Slide 14: Rounding Out Our Footprint
Rounding Out Our Footprint Source: SNL Financial SSB Acquired BAC Branch Orangeburg Charlotte Florence Columbia Greenwood Greenville Savannah Charleston Myrtle Beach Wilmington Hilton Head SSB Acquired Branch Branch Closures Branch Sale
Slide 15: Endnotes
Income reduced by amortization of Indemnification Asset and average balance increased for the average loan Indemnification Asset balance Efficiency ratio = NIE / Net Interest Income + Non Interest Income less securities gain/(loss) Operating efficiency ratio (exc’l) = same as above except excludes m