Southern States Bancshares Inc (SSBK) Announces Q3 2023 Financial Results
Core net income of $9.6 million, or $1.06 per diluted share
Net interest income of $20.7 million, an increase of $1.3 million from the prior quarter
Return on average assets (ROAA) of 1.15%; return on average stockholders equity (ROAE) of 12.96%
Linked-quarter loan growth was 13.3% annualized
On October 24, 2023, Southern States Bancshares Inc (NASDAQ:SSBK) announced its third-quarter financial results for 2023. The company reported a core net income of $9.6 million, or $1.06 per diluted share, and a net income of $6.6 million, or $0.73 per diluted share. The net interest income for the quarter was $20.7 million, marking an increase of $1.3 million from the previous quarter. The company also reported a net interest margin (NIM) of 3.78%, up 5 basis points from the prior quarter.
Performance and Operational Highlights
The company's return on average assets (ROAA) was 1.15%, return on average stockholders equity (ROAE) was 12.96%, and return on average tangible common equity (ROATCE) was 14.21%. The core ROAA was 1.66%, and the core ROATCE was 20.50%. The efficiency ratio stood at 48.01%, and the core efficiency ratio was 42.79%.
SSBK reported a linked-quarter loan growth of 13.3% annualized. However, the linked-quarter total deposits declined 1.5% annualized, primarily due to a reduction in brokered deposits. Excluding brokered deposits, linked-quarter total deposits increased 4.2% annualized from the prior quarter.
CEO Commentary
Mark Chambers, Chief Executive Officer and President of Southern States, said, "Our business development teams continued to identify compelling opportunities in the third quarter, driving annualized sequential loan growth of 13.3% and maintaining the strong momentum we've generated over the past two years as we meet steady loan demand across our economically dynamic footprint."
Financial Tables
The company's net interest income for the third quarter of 2023 was $20.7 million, an increase of 6.7% from $19.4 million for the second quarter of 2023. The increase was primarily driven by the impact of a higher yield on interest-earning assets due to both growth and higher interest rates, which more than offset a higher cost of interest-bearing deposits primarily due to rising interest rates.
Noninterest income for the third quarter of 2023 was reported as a $2.9 million net expense, compared to noninterest income of $6.9 million for the second quarter of 2023. The change in ERC eligibility between the second and third quarters of 2023 is substantially the reason for the significant variation.
Looking Forward
SSBK's strong performance in the third quarter of 2023, marked by robust loan growth and increased net interest income, demonstrates the company's ability to capitalize on market opportunities and maintain a solid financial position. The company's commitment to diligent underwriting and robust credit quality, coupled with its ability to fund loan growth with a healthy deposit franchise, positions it well for future growth.
This article first appeared on GuruFocus.
