SSBK Southern States Bancshares Inc

Southern States Bancshares, Inc. (NASDAQ: SSBK) (“Southern States” or the “Company”), the holding company for Southern States Bank, an Alabama state-chartered commercial bank (the “Bank”), today reported net income of $11.2 million, or $1.11 diluted earnings per share, for the fourth quarter of 2024. This compares to net income of $7.4 million, or $0.76 diluted earnings per share, for the third quarter of 2024, and net income of $8.9 million, or $0.99 diluted earnings per share, for the fourth quarter of 2023. The Company reported core net income of $10.5 million, or $1.04 diluted core earnings per share, for the fourth quarter of 2024. This compares to core net income of $8.7 million, or $0.89 diluted core earnings per share, for the third quarter of 2024, and core net income of $7.3 million, or $0.81 diluted core earnings per share, for the fourth quarter of 2023 (see “Reconciliation of Non-GAAP Financial Measures”).

CEO Commentary
Mark Chambers, Chief Executive Officer and President of Southern States Bancshares, Inc., said “We are proud to report record net income of $11.2 million for the fourth quarter and $34.9 million for the full year, a testament to our team's diligent execution and superior customer service. Our strong operating results reflect our continued consistent growth supported by a healthy net interest margin of 3.66% for the fourth quarter, coupled with an efficiency ratio of 46.67%.”
“We remain firmly committed to prudently managing our franchise for sustainable growth across our dynamic footprint. That starts with maintaining excellent credit quality and strong capital levels.  Disciplined underwriting is critical to our success, and at year end, nonperforming loans accounted for just 0.29% of total loans.’’
“In August 2024, we completed the acquisition of Century Bank and have now seamlessly integrated its customers and team members into our organization. It enhances our presence in Georgia, especially in the high-growth Atlanta metro market, and elevates our position as a premier Southeastern community bank. With 15 full-service branches and two loan production offices across the vibrant economies in Alabama and Georgia, we have substantially expanded and strengthened Southern States Bank’s community banking platform, which we believe sets us up to deliver resilient growth and shareholder returns in 2025.”

Net Interest Income and Net Interest Margin
	Three Months Ended												% Change December 31, 2024 vs.
	December 31, 2024				September 30, 2024				December 31, 2023				September 30, 2024			December 31, 2023
	(Dollars in thousands)
Average interest-earning assets	$	2,722,907			$	2,645,388			$	2,195,381			2.9	%		24.0	%
Net interest income	$	25,050			$	24,246			$	20,404			3.3	%		22.8	%
Net interest margin		3.66	%			3.65	%			3.69	%		1	bps		(3)	bps

Net interest income for the fourth quarter of 2024 was $25.1 million, an increase of 3.3% from $24.2 million for the third quarter of 2024. The increase was substantially due to a decrease in higher-cost brokered deposits as a result of calls and repayments at maturity and replaced with less expensive core deposits.

Relative to the fourth quarter of 2023, net interest income increased $4.6 million, or 22.8%. The increase was mainly driven by significant organic growth, coupled with the acquisition of Century Bank on July 31, 2024.

Net interest margin for the fourth quarter of 2024 was 3.66%, compared to 3.65% for the third quarter of 2024. The slight increase was primarily due to cost savings attributed to calls and repayments at maturity on higher-cost brokered deposits.

Relative to the fourth quarter of 2023, net interest margin decreased slightly from 3.69%. The decrease was primarily the result of the decrease in interest rates. The acquisition of Century Bank resulted in a positive impact to the net interest margin, effectively helping to reduce the cost of interest-bearing liabilities.

Noninterest Income
	Three Months Ended										% Change December 31, 2024 vs.
	December 31, 2024			September 30, 2024				December 31, 2023			September 30, 2024			December 31, 2023
	(Dollars in thousands)
Service charges on deposit accounts	$	565		$	532			$	441		6.2	%		28.1	%
Swap fees (expense)		17			(9	)			70		288.9	%		(75.7)	%
SBA/USDA fees		89			179				70		(50.3)	%		27.1	%
Mortgage origination fees		55			112				87		(50.9)	%		(36.8)
Net gain on securities		25			75				98		(66.7)	%		(74.5)	%
Employee retention credit (“ERC”)		1,154			—				—		N/A			N/A
Other operating income		1,085			868				2,352		25.0	%		(53.9)	%
Total noninterest income	$	2,990		$	1,757			$	3,118		70.2	%		(4.1)	%

Noninterest income for the fourth quarter of 2024 was $3.0 million, an increase of 70.2% from $1.8 million for the third quarter of 2024. The Company applied for the Voluntary Disclosure Program (“VDP”) associated with the ERC program during the third quarter of 2023 and received approval during the fourth quarter of 2024. The fourth quarter of 2024 included $1.2 million in ERC as a participant in the program.

Relative to the fourth quarter of 2023, noninterest income decreased 4.1% from $3.1 million. The fourth quarter of 2023 included a $1.9 million fee related to the early payoff of a $12.0 million purchased loan. As this was unusually large and atypical for the Bank, it was recorded as noninterest income instead of interest income, which would have impacted the net interest margin. The fourth quarter of 2024 included the $1.2 million in ERC discussed earlier. The acquisition of Century Bank on July 31, 2024 resulted in additional noninterest income during the fourth quarter of 2024.

Noninterest Expense
	Three Months Ended									% Change December 31, 2024 vs.
	December 31, 2024			September 30, 2024			December 31, 2023			September 30, 2024			December 31, 2023
	(Dollars in thousands)
Salaries and employee benefits	$	7,002		$	6,876		$	5,739		1.8	%		22.0	%
Equipment and occupancy expenses		851			814			681		4.5	%		25.0	%
Data processing fees		960			781			639		22.9	%		50.2	%
Regulatory assessments		441			414			355		6.5	%		24.2	%
Professional fees related to ERC		236			—			—		N/A			N/A
Merger-related expenses		—			1,511			—		N/A			N/A
Other operating expenses		3,584			3,291			2,303		8.9	%		55.6	%
Total noninterest expenses	$	13,074		$	13,687		$	9,717		(4.5) %			34.5	%

Noninterest expense for the fourth quarter of 2024 was $13.1 million, a decrease of 4.5% from $13.7 million for the third quarter of 2024. The third quarter of 2024 included merger-related expenses of $1.5 million, of which $961,000 was not deductible for taxes, as a result of the acquisition of Century Bank. The fourth quarter of 2024 included professional fees paid to a third party related to ERC, along with an overall increase in noninterest expense as a result of the full-quarter recognition of the acquisition of Century Bank.

Relative to the fourth quarter of 2023, noninterest expense increased 34.5% from $9.7 million. The acquisition of Century Bank on July 31, 2024 resulted in additional noninterest expense during the fourth quarter of 2024.

Loans and Credit Quality
	Three Months Ended												% Change December 31, 2024 vs.
	December 31, 2024				September 30, 2024				December 31, 2023				September 30, 2024			December 31, 2023
	(Dollars in thousands)
Gross loans	$	2,233,244			$	2,205,747			$	1,890,677			1.2	%		18.1	%
Unearned income		(6,675	)			(6,536	)			(6,169	)		2.1	%		8.2	%
Loans, net of unearned income (“Loans”)		2,226,569				2,199,211				1,884,508			1.2	%		18.2	%
Average loans, net of unearned (“Average loans”)	$	2,205,892			$	2,134,318			$	1,814,484			3.4	%		21.6	%
Nonperforming loans (“NPL”)	$	6,533			$	7,868			$	1,177			(17.0)	%		455.1	%
Provision for credit losses	$	72			$	2,583			$	2,579			(97.2)	%		(97.2)	%
Allowance for credit losses (“ACL”)	$	28,338			$	28,061			$	24,378			1.0	%		16.2	%
Net (recoveries) charge-offs	$	(205	)		$	350			$	382			158.6	%		153.7	%
NPL to gross loans		0.29	%			0.36	%			0.06	%
Net (recoveries) charge-offs to average loans(1)		(0.04)	%			0.07	%			0.08	%
ACL to loans		1.27	%			1.28	%			1.29	%
(1)   Ratio is annualized.

Loans, net of unearned income, were $2.2 billion at December 31, 2024, up $27.4 million from September 30, 2024 and up $342.1 million from December 31, 2023. The linked-quarter increase in loans was primarily attributable to new business growth across our footprint. The year-over-year increase in loans was primarily attributable the new business growth across our footprint, coupled with the acquisition of Century Bank, which resulted in additional loans of $131.7 million at December 31, 2024.

Nonperforming loans totaled $6.5 million, or 0.29% of gross loans, at December 31, 2024, compared with $7.9 million, or 0.36% of gross loans, at September 30, 2024, and $1.2 million, or 0.06% of gross loans, at December 31, 2023. The $1.3 million net decrease in nonperforming loans from September 30, 2024 was primarily attributable to a significant commercial and industrial loan being paid down. The $5.4 million net increase in nonperforming loans from December 31, 2023, was primarily attributable to a significant commercial and industrial loan, which has since been paid down, and a commercial real estate loan being placed on nonaccrual status.

The Company recorded a provision for credit losses of $72,000 for the fourth quarter of 2024, compared to $2.6 million for the third quarter of 2024. Provision in the third quarter of 2024 included a $1.7 million provision as a result of the acquisition of Century Bank as well as additional provisions based on growth.

Net recoveries for the fourth quarter of 2024 were $205,000, or (0.04)% of average loans on an annualized basis, compared to net charge-offs of $350,000, or 0.07% of average loans on an annualized basis, for the third quarter of 2024, and net charge-offs of $382,000, or 0.08% of average loans on an annualized basis, for the fourth quarter of 2023. The net recoveries received in the fourth quarter of 2024 were primarily related to a pool of consumer loans charged-off in the third quarter. The charge-offs recorded during the third quarter of 2024 were substantially related to a purchased pool of consumer loans for which the borrower filed for bankruptcy. The loan was fully charged-off as of September 30, 2024.

The Company’s allowance for credit losses was 1.27% of total loans and 433.77% of nonperforming loans at December 31, 2024, compared with 1.28% of total loans and 356.65% of nonperforming loans at September 30, 2024. Allowance for credit losses on unfunded commitments was $1.4 million at December 31, 2024.

Deposits
	Three Months Ended												% Change December 31, 2024 vs.
	December 31, 2024				September 30, 2024				December 31, 2023				September 30, 2024			December 31, 2023
	(Dollars in thousands)
Noninterest-bearing deposits	$	575,357			$	546,282			$	437,959			5.3	%		31.4	%
Interest-bearing deposits		1,835,940				1,874,264				1,580,230			(2.0)	%		16.2	%
Total deposits	$	2,411,297			$	2,420,546			$	2,018,189			(0.4)	%		19.5	%
Uninsured deposits	$	760,141			$	735,676			$	615,651			3.3	%		23.5	%
Uninsured deposits to total deposits and accrued interest on deposits		31.50	%			30.37	%			30.51	%
Noninterest deposits to total deposits		23.86	%			22.57	%			21.70	%

Total deposits were $2.4 billion at December 31, 2024, down slightly from $2.4 billion at September 30, 2024 and up from $2.0 billion at December 31, 2023. The $9.2 million decrease in total deposits in the fourth quarter from the previous quarter was primarily due to a $44.1 million decrease in brokered deposits due to calls and maturation, partially offset by an increase of $29.1 million in noninterest-bearing deposits. Total brokered deposits were $150.0 million at December 31, 2024, compared to $194.2 million at September 30, 2024. Excluding brokered deposits, total deposits increased $34.9 million in the fourth quarter of 2024.

Capital
	December 31, 2024						September 30, 2024						December 31, 2023
	Company			Bank			Company			Bank			Company			Bank
Tier 1 capital ratio to average assets	8.67	%		11.45	%		8.64	%		11.48	%		8.99	%		12.01	%
Risk-based capital ratios:
Common equity tier 1 (“CET1”) capital ratio	9.84	%		12.99	%		9.36	%		12.43	%		9.20	%		12.30	%
Tier 1 capital ratio	9.84	%		12.99	%		9.36	%		12.43	%		9.20	%		12.30	%
Total capital ratio	14.73	%		14.18	%		14.18	%		13.59	%		14.29	%		13.45	%

As of December 31, 2024, total stockholders’ equity was $279.9 million, up from $271.4 million at September 30, 2024. The increase of $8.5 million was substantially due to strong earnings growth, partially offset by an increase in accumulated other comprehensive losses resulting from changes in the value of available for sale securities.

About Southern States Bancshares, Inc.

Headquartered in Anniston, Alabama, Southern States Bancshares, Inc. is a bank holding company that operates primarily through its wholly-owned subsidiary, Southern States Bank. The Bank is a full service community banking institution, which offers an array of deposit, loan and other banking-related products and services to businesses and individuals in its communities. The Bank operates 15 branches in Alabama and Georgia and two loan production offices in Atlanta.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the federal securities laws, which reflect our current expectations and beliefs with respect to, among other things, future events and our financial performance. These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections about our industry, management’s beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond our control. This may be especially true given recent events and trends in the banking industry. Although we believe that the expectations reflected in such forward-looking statements are reasonable as of the dates made, we cannot give any assurance that such expectations will prove correct and actual results may prove to be materially different from the results expressed or implied by the forward-looking statements. Important factors that could cause actual results to differ materially from those in the forward-looking statements are set forth in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 under the section entitled “Cautionary Note Regarding Forward-Looking Statements” and “Risk Factors”. Accordingly, we caution you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions and uncertainties that are difficult to predict.

These statements are often, but not always, made through the use of words or phrases such as “may,” “can,” “should,” “could,” “to be,” “predict,” “potential,” “believe,” “will likely result,” “expect,” “continue,” “will,” “likely,” “anticipate,” “seek,” “estimate,” “intend,” “plan,” “target,” “project,” “would” and “outlook,” or the negative version of those words or other similar words or phrases of a future or forward-looking nature. Forward-looking statements appear in a number of places in this press release and may include statements about our acquisition of Century Bank of Georgia, business strategy and prospects for growth, operations, ability to pay dividends, competition, regulation and general economic conditions.

Contact Information
Lynn Joyce				Margaret Boyce
(205) 820-8065				(310) 622-8247
ljoyce@ssbank.bank				ssbankir@finprofiles.com

SELECT FINANCIAL DATA
(Dollars in thousands, except share and per share amounts)
	Three Months Ended												Twelve Months Ended
	December 31, 2024				September 30, 2024				December 31, 2023				December 31, 2024				December 31, 2023
Results of Operations
Interest income	$	44,977			$	45,068			$	36,172			$	169,781			$	132,260
Interest expense		19,927				20,822				15,768				78,074				52,148
Net interest income		25,050				24,246				20,404				91,707				80,112
Provision for credit losses		72				2,583				2,579				4,957				6,090
Net interest income after provision		24,978				21,663				17,825				86,750				74,022
Noninterest income		2,990				1,757				3,118				7,390				8,874
Noninterest expense		13,074				13,687				9,717				48,548				41,876
Income tax expense		3,696				2,380				2,330				10,724				9,068
Net income	$	11,198			$	7,353			$	8,896			$	34,868			$	31,952
Core net income(1)	$	10,484			$	8,675			$	7,289			$	36,339			$	31,190
Share and Per Share Data
Shares issued and outstanding		9,889,260				9,882,350				8,841,349				9,889,260				8,841,349
Weighted average shares outstanding:
Basic		9,940,221				9,608,868				8,864,734				9,357,336				8,809,590
Diluted		10,061,735				9,725,884				9,021,358				9,503,994				9,038,004
Earnings per share:
Basic	$	1.13			$	0.76			$	1.00			$	3.72			$	3.63
Diluted		1.11				0.76				0.99				3.67				3.53
Core - diluted(1)		1.04				0.89				0.81				3.82				3.45
Book value per share		28.30				27.46				24.31				28.30				24.31
Tangible book value per share(1)		24.04				23.38				22.30				24.04				22.30
Cash dividends per common share		0.09				0.09				0.09				0.36				0.36
Performance and Financial Ratios
ROAA		1.55	%			1.05	%			1.53	%			1.31	%			1.44	%
ROAE		16.13	%			11.89	%			17.02	%			14.39	%			16.16	%
Core ROAA(1)		1.45	%			1.24	%			1.26	%			1.36	%			1.41	%
ROATCE(1)		18.87	%			13.35	%			18.62	%			16.10	%			17.78	%
Core ROATCE(1)		17.67	%			15.74	%			15.26	%			16.78	%			17.35	%
NIM		3.66	%			3.65	%			3.69	%			3.61	%			3.81	%
NIM - FTE(1)		3.67	%			3.66	%			3.71	%			3.63	%			3.82	%
Net interest spread		2.64	%			2.66	%			2.73	%			2.62	%			2.92	%
Yield on loans		7.03	%			7.21	%			6.91	%			7.12	%			6.70	%
Yield on interest-earning assets		6.57	%			6.78	%			6.54	%			6.69	%			6.29	%
Cost of interest-bearing liabilities		3.93	%			4.12	%			3.81	%			4.07	%			3.37	%
Cost of funds(2)		3.09	%			3.31	%			3.03	%			3.27	%			2.63	%
Cost of interest-bearing deposits		3.83	%			4.03	%			3.66	%			3.96	%			3.19	%
Cost of total deposits		2.96	%			3.19	%			2.86	%			3.13	%			2.44	%
Noninterest deposits to total deposits		23.86	%			22.57	%			21.70	%			23.86	%			21.70	%
Core deposits to total deposits		87.90	%			86.30	%			83.70	%			87.90	%			83.70	%
Uninsured deposits to total deposits and accrued interest on deposits		31.50	%			30.37	%			30.51	%			31.50	%			30.51	%
Total loans to total deposits		92.34	%			90.86	%			93.38	%			92.34	%			93.38	%
Efficiency ratio		46.67	%			52.79	%			41.48	%			49.04	%			47.35	%
Core efficiency ratio(1)		47.78	%			46.96	%			45.78	%			46.66	%			46.74	%

(1)  See "Reconciliation of Non-GAAP Financial Measures" below for reconciliation of non-GAAP financial measures to their most closely comparable GAAP financial measures.(2)   Includes total interest-bearing liabilities and noninterest deposits.

SELECT FINANCIAL DATA
(Dollars in thousands)
	Three Months Ended												Twelve Months Ended
	December 31, 2024				September 30, 2024				December 31, 2023				December 31, 2024				December 31, 2023
Financial Condition (ending)
Total loans	$	2,226,569			$	2,199,211			$	1,884,508			$	2,226,569			$	1,884,508
Total securities		216,481				217,692				198,632				216,481				198,632
Total assets		2,849,264				2,841,440				2,446,663				2,849,264				2,446,663
Total noninterest bearing deposits		575,357				546,282				437,959				575,357				437,959
Total core deposits(1)		2,119,491				2,088,993				1,689,266				2,119,491				1,689,266
Total deposits		2,411,297				2,420,546				2,018,189				2,411,297				2,018,189
Total borrowings		131,224				121,083				183,673				131,224				183,673
Total liabilities		2,569,375				2,570,070				2,231,699				2,569,375				2,231,699
Total shareholders’ equity		279,889				271,370				214,964				279,889				214,964
Financial Condition (average)
Total loans	$	2,205,892			$	2,134,318			$	1,814,484			$	2,061,604			$	1,711,006
Total securities		228,213				223,750				209,074				217,943				200,047
Total other interest-earning assets		288,802				287,320				171,823				257,533				192,433
Total interest-bearing assets		2,722,907				2,645,388				2,195,381				2,537,080				2,103,486
Total assets		2,875,981				2,777,215				2,303,398				2,664,353				2,211,742
Total noninterest-bearing deposits		552,898				490,450				420,019				470,376				436,571
Total interest-bearing deposits		1,893,906				1,874,861				1,502,348				1,783,493				1,422,453
Total deposits		2,446,804				2,365,311				1,922,367				2,253,869				1,859,024
Total borrowings		121,356				134,035				140,790				136,788				126,853
Total interest-bearing liabilities		2,015,262				2,008,896				1,643,138				1,920,281				1,549,306
Total shareholders’ equity		276,250				246,081				207,324				242,224				197,680
Asset Quality
Nonperforming loans	$	6,533			$	7,868			$	1,177			$	6,533			$	1,177
Other real estate owned (“OREO”)	$	—			$	33			$	33			$	—			$	33
Nonperforming assets (“NPA”)	$	6,533			$	7,901			$	1,210			$	6,533			$	1,210
Net (recovery) charge-offs to average loans(2)	(0.04) %					0.07	%			0.08	%			0.05	%			0.03	%
Provision for credit losses to average loans(2)		0.01	%			0.48	%			0.56	%			0.24	%			0.36	%
ACL to loans		1.27	%			1.28	%			1.29	%			1.27	%			1.29	%
ACL to gross loans		1.27	%			1.27	%			1.29	%			1.27	%			1.29	%
ACL to NPL		433.77	%			356.65	%			2071.20	%			433.77	%			2071.20	%
NPL to loans		0.29	%			0.36	%			0.06	%			0.29	%			0.06	%
NPL to gross loans		0.29	%			0.36	%			0.06	%			0.29	%			0.06	%
NPA to gross loans and OREO		0.29	%			0.36	%			0.06	%			0.29	%			0.06	%
NPA to total assets		0.23	%			0.28	%			0.05	%			0.23	%			0.05	%
Regulatory and Other Capital Ratios
Total shareholders’ equity to total assets		9.82	%			9.55	%			8.79	%			9.82	%			8.79	%
Tangible common equity to tangible assets(3)		8.47	%			8.25	%			8.12	%			8.47	%			8.12	%
Tier 1 capital ratio to average assets		8.67	%			8.64	%			8.99	%			8.67	%			8.99	%
Risk-based capital ratios:
CET1 capital ratio		9.84	%			9.36	%			9.20	%			9.84	%			9.20	%
Tier 1 capital ratio		9.84	%			9.36	%			9.20	%			9.84	%			9.20	%
Total capital ratio		14.73	%			14.18	%			14.29	%			14.73	%			14.29	%

(1)   We define core deposits as total deposits excluding brokered deposits and time deposits greater than $250,000.(2)   Ratio is annualized.(3)  See "Reconciliation of Non-GAAP Financial Measures" below for reconciliation of non-GAAP financial measures to their most closely comparable GAAP financial measures.

CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(Dollars in thousands)
	December 31, 2024				September 30, 2024				December 31, 2023
	(Unaudited)				(Unaudited)				(Audited)
Assets
Cash and due from banks	$	27,321			$	24,225			$	19,710
Interest-bearing deposits in banks		153,833				182,559				134,846
Federal funds sold		79,080				71,072				96,095
Total cash and cash equivalents		260,234				277,856				250,651
Securities available for sale, at fair value		196,870				198,076				179,000
Securities held to maturity, at amortized cost		19,611				19,616				19,632
Other equity securities, at fair value		3,697				3,733				3,649
Restricted equity securities, at cost		4,441				4,418				5,684
Loans held for sale		404				415				450
Loans, net of unearned income		2,226,569				2,199,211				1,884,508
Less allowance for credit losses		28,338				28,061				24,378
Loans, net		2,198,231				2,171,150				1,860,130
Premises and equipment, net		32,048				32,319				26,426
Accrued interest receivable		10,111				10,114				8,711
Bank owned life insurance		39,431				39,159				29,884
Annuities		16,772				16,843				15,036
Foreclosed assets		—				33				33
Goodwill		33,176				30,980				16,862
Core deposit intangible		8,939				9,338				899
Other assets		25,299				27,390				29,616
Total assets	$	2,849,264			$	2,841,440			$	2,446,663
Liabilities and Stockholders' Equity
Liabilities:
Deposits:
Noninterest-bearing	$	575,357			$	546,282			$	437,959
Interest-bearing		1,835,940				1,874,264				1,580,230
Total deposits		2,411,297				2,420,546				2,018,189
Other borrowings		17,979				7,976				26,994
FHLB advances		22,000				22,000				70,000
Subordinated notes		91,245				91,107				86,679
Accrued interest payable		2,172				2,214				1,519
Other liabilities		24,682				26,227				28,318
Total liabilities		2,569,375				2,570,070				2,231,699
Stockholders' equity:
Common stock		49,821				49,684				44,479
Capital surplus		106,637				106,046				78,361
Retained earnings		134,075				123,783				102,523
Accumulated other comprehensive loss		(7,936	)			(5,866	)			(8,379	)
Unvested restricted stock		(567	)			(723	)			(466	)
Vested restricted stock units		(2,141	)			(1,554	)			(1,554	)
Total stockholders' equity		279,889				271,370				214,964
Total liabilities and stockholders' equity	$	2,849,264			$	2,841,440			$	2,446,663

CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except per share amounts)
	Three Months Ended										Twelve Months Ended
	December 31, 2024			September 30, 2024				December 31, 2023			December 31, 2024			December 31, 2023
	(Unaudited)			(Unaudited)				(Unaudited)			(Unaudited)			(Audited)
Interest income:
Loans, including fees	$	38,972		$	38,690			$	31,613		$	146,712		$	114,662
Taxable securities		2,237			2,205				1,986			8,462			6,806
Nontaxable securities		248			243				230			952			977
Other interest and dividends		3,520			3,930				2,343			13,655			9,815
Total interest income		44,977			45,068				36,172			169,781			132,260
Interest expense:
Deposits		18,223			18,990				13,869			70,630			45,368
Other borrowings		1,704			1,832				1,899			7,444			6,780
Total interest expense		19,927			20,822				15,768			78,074			52,148
Net interest income		25,050			24,246				20,404			91,707			80,112
Provision for credit losses		72			2,583				2,579			4,957			6,090
Net interest income after provision for credit losses		24,978			21,663				17,825			86,750			74,022
Noninterest income:
Service charges on deposit accounts		565			532				441			2,022			1,790
Swap fees (expense)		17			(9	)			70			27			691
SBA/USDA fees		89			179				70			391			344
Mortgage origination fees		55			112				87			356			533
Net gain on securities		25			75				98			108			555
Employee retention credit		1,154			—				—			1,162			—
Other operating income		1,085			868				2,352			3,324			4,961
Total noninterest income		2,990			1,757				3,118			7,390			8,874
Noninterest expenses:
Salaries and employee benefits		7,002			6,876				5,739			26,221			25,665
Equipment and occupancy expenses		851			814				681			3,021			2,776
Data processing fees		960			781				639			3,070			2,528
Regulatory assessments		441			414				355			1,590			1,198
Professional fees related to ERC		236			—				—			236			—
Merger-related expenses		—			1,511				—			1,511			—
Other operating expenses		3,584			3,291				2,303			12,899			9,709
Total noninterest expenses		13,074			13,687				9,717			48,548			41,876
Income before income taxes		14,894			9,733				11,226			45,592			41,020
Income tax expense		3,696			2,380				2,330			10,724			9,068
Net income	$	11,198		$	7,353			$	8,896		$	34,868		$	31,952
Basic earnings per share	$	1.13		$	0.76			$	1.00		$	3.72		$	3.63
Diluted earnings per share	$	1.11		$	0.76			$	0.99		$	3.67		$	3.53

AVERAGE BALANCE SHEET AND NET INTEREST MARGIN
(Dollars in thousands)
	Three Months Ended
	December 31, 2024										September 30, 2024										December 31, 2023
	AverageBalance				Interest			Yield/Rate			AverageBalance				Interest			Yield/Rate			AverageBalance				Interest			Yield/Rate
Assets:
Interest-earning assets:
Loans, net of unearned income(1)	$	2,205,892			$	38,972		7.03	%		$	2,134,318			$	38,690		7.21	%		$	1,814,484			$	31,613		6.91	%
Taxable securities		181,456				2,237		4.90	%			177,164				2,205		4.95	%			163,537				1,986		4.82	%
Nontaxable securities		46,757				248		2.11	%			46,586				243		2.08	%			45,537				230		2.00	%
Other interest-earnings assets		288,802				3,520		4.85	%			287,320				3,930		5.44	%			171,823				2,343		5.41	%
Total interest-earning assets		2,722,907				44,977		6.57	%			2,645,388				45,068		6.78	%			2,195,381				36,172		6.54	%
Allowance for credit losses		(28,280	)									(27,253	)									(22,666	)
Noninterest-earning assets		181,354										159,080										130,683
Total Assets	$	2,875,981									$	2,777,215									$	2,303,398
Liabilities and Stockholders’ Equity:
Interest-bearing liabilities:
Interest-bearing transaction accounts	$	94,039			$	27		0.12	%		$	95,040			$	30		0.13	%		$	86,163			$	23		0.11	%
Savings and money market accounts		1,112,679				10,279		3.68	%			1,042,661				10,264		3.92	%			885,548				8,445		3.78	%
Time deposits		687,188				7,917		4.58	%			737,160				8,696		4.69	%			530,637				5,401		4.04	%
FHLB advances		22,000				300		5.42	%			36,130				455		5.01	%			52,076				645		4.92	%
Other borrowings		99,356				1,404		5.63	%			97,905				1,377		5.59	%			88,714				1,254		5.61	%
Total interest-bearing liabilities	$	2,015,262			$	19,927		3.93	%		$	2,008,896			$	20,822		4.12	%		$	1,643,138			$	15,768		3.81	%
Noninterest-bearing liabilities:
Noninterest-bearing deposits	$	552,898									$	490,450									$	420,019
Other liabilities		31,571										31,788										32,917
Total noninterest-bearing liabilities		584,469										522,238										452,936
Stockholders’ Equity		276,250										246,081										207,324
Total Liabilities and Stockholders’ Equity	$	2,875,981									$	2,777,215									$	2,303,398
Net interest income					$	25,050									$	24,246									$	20,404
Net interest spread(2)								2.64	%									2.66	%									2.73	%
Net interest margin(3)								3.66	%									3.65	%									3.69	%
Net interest margin - FTE(4)(5)								3.67	%									3.66	%									3.71	%
Cost of funds(6)								3.09	%									3.31	%									3.03	%
Cost of interest-bearing deposits								3.83	%									4.03	%									3.66	%
Cost of total deposits								2.96	%									3.19	%									2.86	%

1. Includes nonaccrual loans.
2. Net interest spread is the difference between interest rates earned on interest earning assets and interest rates paid on interest-bearing liabilities.
3. Net interest margin is a ratio of net interest income to average interest earning assets for the same period.
4. Net interest margin - FTE is a ratio of fully-taxable equivalent net interest income to average interest earning assets for the same period. It assumes a 24.0% tax rate.
5. Refer to “Reconciliation of Non-GAAP Financial Measures”.
6. Includes total interest-bearing liabilities and noninterest deposits.

AVERAGE BALANCE SHEET AND NET INTEREST MARGIN
(Dollars in thousands)
	Twelve Months Ended
	December 31, 2024										December 31, 2023
	AverageBalance				Interest			Yield/Rate			AverageBalance				Interest			Yield/Rate
Assets:
Interest-earning assets:
Loans, net of unearned income(1)	$	2,061,604			$	146,712		7.12	%		$	1,711,006			$	114,662		6.70	%
Taxable securities		171,878				8,462		4.92	%			152,707				6,806		4.46	%
Nontaxable securities		46,065				952		2.07	%			47,340				977		2.06	%
Other interest-earnings assets		257,533				13,655		5.30	%			192,433				9,815		5.10	%
Total interest-earning assets		2,537,080				169,781		6.69	%			2,103,486				132,260		6.29	%
Allowance for credit losses		(26,302	)									(21,233	)
Noninterest-earning assets		153,575										129,489
Total Assets	$	2,664,353									$	2,211,742
Liabilities and Stockholders’ Equity:
Interest-bearing liabilities:
Interest-bearing transaction accounts	$	90,252			$	105		0.12	%		$	90,231			$	82		0.09	%
Savings and money market accounts		997,349				38,576		3.87	%			851,351				28,124		3.30	%
Time deposits		695,892				31,949		4.59	%			480,871				17,162		3.57	%
FHLB advances		39,847				2,006		5.03	%			39,830				1,848		4.64	%
Other borrowings		96,941				5,438		5.61	%			87,023				4,932		5.67	%
Total interest-bearing liabilities	$	1,920,281			$	78,074		4.07	%		$	1,549,306			$	52,148		3.37	%
Noninterest-bearing liabilities:
Noninterest-bearing deposits	$	470,376									$	436,571
Other liabilities		31,472										28,185
Total noninterest-bearing liabilities		501,848										464,756
Stockholders’ Equity		242,224										197,680
Total Liabilities and Stockholders’ Equity	$	2,664,353									$	2,211,742
Net interest income					$	91,707									$	80,112
Net interest spread(2)								2.62	%									2.92	%
Net interest margin(3)								3.61	%									3.81	%
Net interest margin - FTE(4)(5)								3.63	%									3.82	%
Cost of funds(6)								3.27	%									2.63	%
Cost of interest-bearing deposits								3.96	%									3.19	%
Cost of total deposits								3.13	%									2.44	%

1. Includes nonaccrual loans.
2. Net interest spread is the difference between interest rates earned on interest earning assets and interest rates paid on interest-bearing liabilities.
3. Net interest margin is a ratio of net interest income to average interest earning assets for the same period.
4. Net interest margin - FTE is a ratio of fully-taxable equivalent net interest income to average interest earning assets for the same period. It assumes a 24.0% tax rate.
5. Refer to “Reconciliation of Non-GAAP Financial Measures”.
6. Includes total interest-bearing liabilities and noninterest deposits.

LOAN COMPOSITION
(Dollars in thousands)
	December 31, 2024							September 30, 2024							December 31, 2023
	Amount				% of gross			Amount				% of gross			Amount				% of gross
Real estate mortgages:
Construction and development	$	238,634			10.7	%		$	245,275			11.1	%		$	242,960			12.9	%
Residential		315,092			14.1	%			293,150			13.3	%			224,603			11.9	%
Commercial		1,352,084			60.6	%			1,344,554			61.0	%			1,144,867			60.5	%
Commercial and industrial		315,854			14.1	%			310,540			14.1	%			269,961			14.3	%
Consumer and other		11,580			0.5	%			12,228			0.5	%			8,286			0.4	%
Gross loans		2,233,244			100.0	%			2,205,747			100.0	%			1,890,677			100.0	%
Unearned income		(6,675	)						(6,536	)						(6,169	)
Loans, net of unearned income		2,226,569							2,199,211							1,884,508
Allowance for credit losses		(28,338	)						(28,061	)						(24,378	)
Loans, net	$	2,198,231						$	2,171,150						$	1,860,130

DEPOSIT COMPOSITION
(Dollars in thousands)
	December 31, 2024						September 30, 2024						December 31, 2023
	Amount			% of total			Amount			% of total			Amount			% of total
Noninterest-bearing transaction	$	575,357		23.8	%		$	546,282		22.5	%		$	437,959		21.7	%
Interest-bearing transaction		1,128,959		46.8	%			1,124,706		46.5	%			946,347		46.9	%
Savings		52,472		2.2	%			53,565		2.2	%			35,412		1.7	%
Time deposits, $250,000 and under		512,717		21.3	%			558,600		23.1	%			500,406		24.8	%
Time deposits, over $250,000		141,792		5.9	%			137,393		5.7	%			98,065		4.9	%
Total deposits	$	2,411,297		100.0	%		$	2,420,546		100.0	%		$	2,018,189		100.0	%

Nonperfoming Assets
(Dollars in thousands)
	December 31, 2024				September 30, 2024				December 31, 2023
Nonaccrual loans	$	6,434			$	7,803			$	1,017
Past due loans 90 days or more and still accruing interest		99				65				160
Total nonperforming loans		6,533				7,868				1,177
OREO		—				33				33
Total nonperforming assets	$	6,533			$	7,901			$	1,210
Financial difficulty modification loans – nonaccrual(1)		600				622				907
Financial difficulty modification loans – accruing		1,055				1,071				1,095
Financial difficulty modification loans	$	1,655			$	1,693			$	2,002
Allowance for credit losses	$	28,338			$	28,061			$	24,378
Loans, net of unearned income at the end of the period	$	2,226,569			$	2,199,211			$	1,884,508
Gross loans outstanding at the end of period	$	2,233,244			$	2,205,747			$	1,890,677
Total assets	$	2,849,264			$	2,841,440			$	2,446,663
Allowance for credit losses to nonperforming loans		433.77	%			356.65	%			2071.20	%
Nonperforming loans to loans, net of unearned income		0.29	%			0.36	%			0.06	%
Nonperforming loans to gross loans		0.29	%			0.36	%			0.06	%
Nonperforming assets to gross loans and OREO		0.29	%			0.36	%			0.06	%
Nonperforming assets to total assets		0.23	%			0.28	%			0.05	%
Nonaccrual loans by category:
Real estate mortgages:
Construction & Development	$	415			$	—			$	—
Residential Mortgages		559				522				252
Commercial Real Estate Mortgages		2,097				2,155				765
Commercial & Industrial		3,363				5,126				—
Consumer and other		—				—				—
Total	$	6,434			$	7,803			$	1,017

(1)   Financial difficulty modifications loans are excluded from nonperforming loans unless they otherwise meet the definition of nonaccrual loans or are more than 90 days past due.

Allowance for Credit Losses
(Dollars in thousands)
	Three Months Ended												Twelve Months Ended
	December 31, 2024				September 30, 2024				December 31, 2023				December 31, 2024				December 31, 2023
Average loans, net of unearned income	$	2,205,892			$	2,134,318			$	1,814,484			$	2,061,604			$	1,711,006
Loans, net of unearned income		2,226,569				2,199,211				1,884,508				2,226,569				1,884,508
Gross loans		2,233,244				2,205,747				1,890,677				2,233,244				1,890,677
Allowance for credit losses at beginning of the period		28,061				25,828				22,181				24,378				20,156
Impact of adoption of ASC 326		—				—				—				—				(1,285	)
Charge-offs:
Construction and development		—				—				—				—				3
Residential		—				—				—				11				—
Commercial		—				119				—				157				—
Commercial and industrial		—				384				424				1,210				686
Consumer and other		—				—				2				25				8
Total charge-offs		—				503				426				1,403				697
Recoveries:
Construction and development		—				—				—				—				—
Residential		7				13				4				34				41
Commercial		—				—				—				—				—
Commercial and industrial		196				139				39				367				54
Consumer and other		2				1				1				5				19
Total recoveries		205				153				44				406				114
Net (recoveries) charge-offs	$	(205	)		$	350			$	382			$	997			$	583
Provision for credit losses	$	72			$	2,583			$	2,579			$	4,957			$	6,090
Balance at end of the period	$	28,338			$	28,061			$	24,378			$	28,338			$	24,378
Allowance for credit losses on unfunded commitments at beginning of the period	$	1,405			$	1,206			$	1,524			$	1,239			$	—
Impact of adoption of ASC 326		—				—				—				—				1,285
Day 2 impact from acquisition		—				199				—				199				—
Credit for credit losses on unfunded commitments		—				—				(285	)			(33	)			(46	)
Balance at the end of the period	$	1,405			$	1,405			$	1,239			$	1,405			$	1,239
Allowance to loans, net of unearned income		1.27	%			1.28	%			1.29	%			1.27	%			1.29	%
Allowance to gross loans		1.27	%			1.27	%			1.29	%			1.27	%			1.29	%
Net (recoveries) charge-offs to average loans, net of unearned income(1)		(0.04)	%			0.07	%			0.08	%			0.05	%			0.03	%
Provision for credit losses to average loans, net of unearned income(1)		0.01	%			0.48	%			0.56	%			0.24	%			0.36	%

(1)   Ratio is annualized.

Reconciliation of Non-GAAP Financial Measures

Noninterest Expense

In addition to reporting GAAP results, the Company reports non-GAAP financial measures in this earnings release and other disclosures. Our management believes that these non-GAAP financial measures and the information they provide are useful to investors since these measures permit investors to view our performance using the same tools that our management uses to evaluate our performance. While we believe that these non-GAAP financial measures are useful in evaluating our performance, this information should be considered as supplemental in nature and not as a substitute for or superior to the related financial information prepared in accordance with GAAP. Additionally, these non-GAAP financial measures may differ from similar measures presented by other companies.

The following table provides a reconciliation of the non-GAAP financial measures to their most directly comparable financial measure presented in accordance with GAAP.

Reconciliation of Non-GAAP Financial Measures
(Dollars in thousands, except share and per share amounts)
	Three Months Ended												Twelve Months Ended
	December 31, 2024				September 30, 2024				December 31, 2023				December 31, 2024				December 31, 2023
Net income	$	11,198			$	7,353			$	8,896			$	34,868			$	31,952
Add:  One-time retirement related expenses		—				—				—				—				1,571
Add:  Professional fees related to ERC		236				—				—				236				—
Add:  Wire fraud loss		—				—				—				1,155				—
Add:  Merger-related expenses		—				1,511				—				1,511				—
Add:  Net OREO loss (gain)		3				—				(154	)			—				(156	)
Less: Employee retention credit		1,154				—				—				1,162				—
Less: Fee received on early loan payoff		—				—				1,863				—				1,863
Less: Net gain on securities		25				75				98				108				555
Less: Tax effect		(226	)			114				(508	)			161				(241	)
Core net income	$	10,484			$	8,675			$	7,289			$	36,339			$	31,190
Average assets	$	2,875,981			$	2,777,215			$	2,303,398			$	2,664,353			$	2,211,742
Core return on average assets		1.45	%			1.24	%			1.26	%			1.36	%			1.41	%
Net income	$	11,198			$	7,353			$	8,896			$	34,868			$	31,952
Add:  One-time retirement related expenses		—				—				—				—				1,571
Add:  Professional fees related to ERC		236				—				—				236				—
Add:  Wire fraud loss		—				—				—				1,155				—
Add:  Merger-related expenses		—				1,511				—				1,511				—
Add:  Net OREO loss (gain)		3				—				(154	)			—				(156	)
Add:  Provision		72				2,583				2,579				4,957				6,090
Less: Employee retention credit		1,154				—				—				1,162				—
Less: Fee received on early loan payoff		—				—				1,863				—				1,863
Less: Net gain on securities		25				75				98				108				555
Add:  Income taxes		3,696				2,380				2,330				10,724				9,068
Pretax pre-provision core net income	$	14,026			$	13,752			$	11,690			$	52,181			$	46,107
Average assets	$	2,875,981			$	2,777,215			$	2,303,398			$	2,664,353			$	2,211,742
Pretax pre-provision core return on average assets		1.94	%			1.97	%			2.01	%			1.96	%			2.08	%
Net interest income	$	25,050			$	24,246			$	20,404			$	91,707			$	80,112
Add:  Fully-taxable equivalent adjustments(1)		66				75				99				288				312
Net interest income - FTE	$	25,116			$	24,321			$	20,503			$	91,995			$	80,424
Net interest margin		3.66	%			3.65	%			3.69	%			3.61	%			3.81	%
Effect of fully-taxable equivalent adjustments(1)		0.01	%			0.01	%			0.02	%			0.02	%			0.01	%
Net interest margin - FTE		3.67	%			3.66	%			3.71	%			3.63	%			3.82	%
Total stockholders' equity	$	279,889			$	271,370			$	214,964			$	279,889			$	214,964
Less:  Intangible assets		42,115				40,318				17,761				42,115				17,761
Tangible common equity	$	237,774			$	231,052			$	197,203			$	237,774			$	197,203
(1)  Assumes a 24.0% tax rate.
Reconciliation of Non-GAAP Financial Measures
(Dollars in thousands, except share and per share amounts)
	Three Months Ended												Twelve Months Ended
	December 31, 2024				September 30, 2024				December 31, 2023				December 31, 2024				December 31, 2023
Core net income	$	10,484			$	8,675			$	7,289			$	36,339			$	31,190
Diluted weighted average shares outstanding		10,061,735				9,725,884				9,021,358				9,503,994				9,038,004
Diluted core earnings per share	$	1.04			$	0.89			$	0.81			$	3.82			$	3.45
Common shares outstanding at year or period end		9,889,260				9,882,350				8,841,349				9,889,260				8,841,349
Tangible book value per share	$	24.04			$	23.38			$	22.30			$	24.04			$	22.30
Total assets at end of period	$	2,849,264			$	2,841,440			$	2,446,663			$	2,849,264			$	2,446,663
Less:  Intangible assets		42,115				40,318				17,761				42,115				17,761
Adjusted assets at end of period	$	2,807,149			$	2,801,122			$	2,428,902			$	2,807,149			$	2,428,902
Tangible common equity to tangible assets		8.47	%			8.25	%			8.12	%			8.47	%			8.12	%
Total average shareholders equity	$	276,250			$	246,081			$	207,324			$	242,224			$	197,680
Less:  Average intangible assets		40,177				26,884				17,809				25,653				17,932
Average tangible common equity	$	236,073			$	219,197			$	189,515			$	216,571			$	179,748
Net income to common shareholders	$	11,198			$	7,353			$	8,896			$	34,868			$	31,952
Return on average tangible common equity		18.87	%			13.35	%			18.62	%			16.10	%			17.78	%
Average tangible common equity	$	236,073			$	219,197			$	189,515			$	216,571			$	179,748
Core net income	$	10,484			$	8,675			$	7,289			$	36,339			$	31,190
Core return on average tangible common equity		17.67	%			15.74	%			15.26	%			16.78	%			17.35	%
Net interest income	$	25,050			$	24,246			$	20,404			$	91,707			$	80,112
Add:  Noninterest income		2,990				1,757				3,118				7,390				8,874
Less: Employee retention credit		1,154				—				—				1,162				—
Less: Fee received on early loan payoff		—				—				1,863				—				1,863
Less: Net gain on securities		25				75				98				108				555
Operating revenue	$	26,861			$	25,928			$	21,561			$	97,827			$	86,568
Expenses:
Total noninterest expense	$	13,074			$	13,687			$	9,717			$	48,548			$	41,876
Less: One-time retirement related expenses		—				—				—				—				1,571
Less: Professional fees related to ERC		236				—				—				236				—
Less: Wire fraud loss		—				—				—				1,155				—
Less: Merger-related expenses		—				1,511				—				1,511				—
Less: Net OREO loss (gain)		3				—				(154	)			—				(156	)
Less: Loss on sale of branches		—				—				—				—				—
Adjusted noninterest expenses	$	12,835			$	12,176			$	9,871			$	45,646			$	40,461
Core efficiency ratio		47.78	%			46.96	%			45.78	%			46.66	%			46.74	%