South Atlantic Bancshares' Strong Q3: Earnings Jump to $0.57
South Atlantic Bancshares, Inc. Achieves Significant Earnings Growth
South Atlantic Bancshares, Inc. (OTCQX: SABK), parent of South Atlantic Bank, recently announced that it achieved consolidated net income of $4.4 million, or $0.57 per diluted common share, for the third quarter of 2025. This represents a notable increase from the $3.7 million, or $0.48 per diluted common share, reported in the prior quarter. Over the nine months ending September 30, 2025, the company recorded $11.4 million in net income, translating to $1.48 per diluted common share, up from $6.9 million, or $0.90 per diluted common share, for the same period in 2024.
Quarterly Financial Highlights
Strong Performance Indicators
The third quarter of 2025 marked a significant milestone, reflecting the company's robust performance, highlighted by an 18.9% quarter-over-quarter increase in net income, amounting to an additional $697,000. Compared to the third quarter of 2024, net income soared by $1.8 million, or 68.3%, demonstrating consistent growth within the company.
Additional key financial highlights from the quarter include:
- Total assets rose by $104.2 million to $1.9 billion, showcasing a healthy annualized growth rate of 7.8% from December 31, 2024.
- Total loans expanded by $87.6 million, contributing to an annual growth rate of 8.7%.
- Total deposits increased significantly by $128.0 million, reflecting an annual rate of 11.7%.
- Tangible book value per share climbed by $1.02, representing a 6.6% increase, reaching $16.49 as of September 30, 2025.
Management Insights
K. Wayne Wicker, Chairman and CEO, attributed these strong results to the ongoing strength of the core banking franchise and disciplined execution across various markets. He noted that while deposit and loan activities remain robust, some seasonal trends temporarily impacted deposit balances. However, favorable trends in credit quality give the company confidence as it heads into the final quarter of the year.
The CEO highlighted a modest decline in loan growth attributable to scheduled payoffs and the timing of transaction closings—factors that align with the company's annual growth expectations, suggesting a sustained positive momentum.
Earnings Summary
Growth in Interest Income
During the three months ending September 30, 2025, South Atlantic Bancshares witnessed an increase in net interest income by $3.1 million or 27.2%, bringing it to $14.6 million compared to $11.5 million during the same period of the previous year. This growth was primarily driven by enhanced yields and organic loan growth.
Despite a decrease in interest income from the company's investment portfolio, the overall financial health remains strong, bolstered by a 27.2% increase in net interest income year-to-date, reaching a total of $40.8 million, compared to $32.1 million the previous year.
Noninterest Income and Expenses
Noninterest income also saw improvements, with a $212,000 increase, reflecting a boost from higher secondary mortgage income and fees. Noninterest expenses rose by $1.4 million, attributed chiefly to higher salaries and employee benefits, as well as other operational costs, reflecting the company’s investments in human resources and technology.
Balance Sheet and Asset Management
As of the end of September 2025, total assets for South Atlantic Bancshares increased to $1.9 billion, a notable rise anchored by growth in the loan portfolio and cash equivalents. The increment in total deposits also illustrates the trust clients place in the bank's services, despite minor reductions in borrowing levels.
Shareholders’ equity stood at $128.6 million, an increase attributed to strong retained earnings and strategic repurchases under the company's stock repurchase program.
Regulatory Capital and Risk Management
The Bank maintains a solid capital position, surpassing the regulatory requirements to be classified as well-capitalized. The total risk-based capital ratio was reported at 12.24%, alongside an 8.86% leverage ratio, signifying financial stability and growth potential moving forward.
Furthermore, the Company continues to manage liquidity prudently, regularly leveraging various financing mechanisms including Pay-Fixed Swap Agreements to hedge against interest rate risks associated with its operations.
Conclusion
The recent announcement from South Atlantic Bancshares, Inc. demonstrates a strong financial performance and resilience in a complex economic landscape. With solid earnings growth, strategic financial management, and a thorough focus on enhancing customer experience, the Bank is well-positioned for continued success in the upcoming quarters.
Frequently Asked Questions
What were the earnings per share for South Atlantic Bancshares?
The earnings per diluted common share for the third quarter of 2025 were reported at $0.57.
How much did total deposits increase during the year?
Total deposits increased by $128.0 million, reflecting an annual growth of 11.7% by September 30, 2025.
What initiatives are taken for risk management?
The company employs Pay-Fixed Swap Agreements to manage interest rate risks associated with its financing operations.
What is the reported total assets of South Atlantic Bancshares?>
The reported total assets have increased to $1.9 billion as of September 30, 2025.
What factors contributed to the increase in noninterest income?
The increase in noninterest income was mainly attributed to enhanced secondary mortgage income, service fees, and increase in merchant income.
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