株探米国株
英語
エドガーで原本を確認する
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-Q
(Mark One)
☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 
For the quarterly period ended September 30, 2023
 
OR
☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Commission File Number:  001-13901
bancorplionclean.jpg
AMERIS BANCORP
(Exact name of registrant as specified in its charter)
Georgia 58-1456434
(State of incorporation) (IRS Employer ID No.)
3490 Piedmont Rd N.E., Suite 1550
Atlanta Georgia 30305
(Address of principal executive offices)
(404) 639-6500
(Registrant’s telephone number) 

Securities registered pursuant to Section 12(b) of the Act:
Title of each class Trading Symbol(s) Name of each exchange on which registered
Common Stock, par value $1 per share ABCB Nasdaq Global Select Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ý    No   ¨
 
Indicate by check mark whether the Registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  ý    No   ¨
 
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer ý Accelerated filer ☐
       
Non-accelerated filer
☐ 
 Smaller reporting company ☐
       
  Emerging growth company ☐
 
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
 
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐   No  ý

 There were 69,052,061 shares of Common Stock outstanding as of November 3, 2023.


AMERIS BANCORP
TABLE OF CONTENTS
    Page
     
PART I – FINANCIAL INFORMATION  
     
Item 1.  
     
 
     
 
     
 
     
 
     
 
     
Item 2.
     
Item 3.
     
Item 4.
     
 
     
Item 1.
     
Item 1A.
     
Item 2.
     
Item 3.
     
Item 4.
     
Item 5.
     
Item 6.
     




Item 1. Financial Statements.

AMERIS BANCORP AND SUBSIDIARIES
Consolidated Balance Sheets
(dollars in thousands, except per share data)
  September 30, 2023 (unaudited) December 31, 2022
Assets    
Cash and due from banks $ 241,137  $ 284,567 
Federal funds sold and interest-bearing deposits in banks 1,304,636  833,565 
Cash and cash equivalents 1,545,773  1,118,132 
Debt securities available-for-sale, at fair value, net of allowance for credit losses of $80 and $75
 1,424,081  1,500,060 
Debt securities held-to-maturity, at amortized cost, net of allowance for credit losses of $— and $— (fair value of $115,689 and $114,538)
 141,859  134,864 
Other investments 104,957  110,992 
Loans held for sale, at fair value 381,466  392,078 
Loans, net of unearned income 20,201,079  19,855,253 
Allowance for credit losses (290,104) (205,677)
Loans, net 19,910,975  19,649,576 
Other real estate owned, net 3,397  843 
Premises and equipment, net 217,564  220,283 
Goodwill 1,015,646  1,015,646 
Other intangible assets, net 92,375  106,194 
Cash value of bank owned life insurance 393,769  388,405 
Other assets 465,968  416,213 
Total assets $ 25,697,830  $ 25,053,286 
Liabilities    
Deposits:    
Noninterest-bearing $ 6,589,610  $ 7,929,579 
Interest-bearing 14,000,735  11,533,159 
Total deposits 20,590,345  19,462,738 
Other borrowings 1,209,553  1,875,736 
Subordinated deferrable interest debentures 129,817  128,322 
Other liabilities 421,046  389,090 
Total liabilities 22,350,761  21,855,886 
Commitments and Contingencies (Note 8)
Shareholders’ Equity    
Preferred stock, stated value $1,000; 5,000,000 shares authorized; 0 shares issued and outstanding
 —  — 
Common stock, par value $1; 200,000,000 shares authorized; 72,514,047 and 72,263,727 shares issued
 72,514  72,264 
Capital surplus 1,942,852  1,935,211 
Retained earnings 1,484,424  1,311,258 
Accumulated other comprehensive loss, net of tax (60,818) (46,507)
Treasury stock, at cost, 3,375,586 and 2,894,677 shares
 (91,903) (74,826)
Total shareholders’ equity 3,347,069  3,197,400 
Total liabilities and shareholders’ equity $ 25,697,830  $ 25,053,286 

 See notes to unaudited consolidated financial statements.
1

AMERIS BANCORP AND SUBSIDIARIES
Consolidated Statements of Income and Comprehensive Income (unaudited)
(dollars and shares in thousands, except per share data)
  Three Months Ended
September 30,		 Nine Months Ended
September 30,
  2023 2022 2023 2022
Interest income        
Interest and fees on loans $ 304,699  $ 216,400  $ 868,675  $ 584,706 
Interest on taxable securities 14,754  10,324  44,969  21,627 
Interest on nontaxable securities 331  363  1,009  818 
Interest on deposits in other banks and federal funds sold 10,769  7,215  33,568  13,093 
Total interest income 330,553  234,302  948,221  620,244 
Interest expense        
Interest on deposits 102,999  14,034  244,268  23,034 
Interest on other borrowings 19,803  7,287  75,010  20,321 
Total interest expense 122,802  21,321  319,278  43,355 
Net interest income 207,751  212,981  628,943  576,889 
Provision for loan losses 30,095  17,469  123,114  27,962 
Provision for unfunded commitments (5,634) 192  (3,415) 10,980 
Provision for other credit losses (2) (9) 5  (135)
Provision for credit losses 24,459  17,652  119,704  38,807 
Net interest income after provision for credit losses 183,292  195,329  509,239  538,082 
Noninterest income        
Service charges on deposit accounts 12,092  11,168  34,323  33,374 
Mortgage banking activity 36,290  40,350  108,424  162,049 
Other service charges, commissions and fees 1,221  970  3,167  2,907 
Net gain (loss) on securities (16) (21) (16) 200 
Other noninterest income 13,594  12,857  40,682  37,546 
Total noninterest income 63,181  65,324  186,580  236,076 
Noninterest expense        
Salaries and employee benefits 81,898  78,697  244,144  244,523 
Occupancy and equipment 12,745  12,983  38,253  38,456 
Data processing and communications expenses 12,973  12,015  39,458  36,742 
Credit resolution-related expenses (1,360) 126  (77) (343)
Advertising and marketing 2,723  3,553  8,882  8,663 
Amortization of intangible assets 4,425  4,710  13,819  15,035 
Merger and conversion charges —  —  —  977 
Loan servicing expense 9,290  9,613  26,392  28,452 
Other noninterest expenses 18,752  17,881  58,399  53,089 
Total noninterest expense 141,446  139,578  429,270  425,594 
Income before income tax expense 105,027  121,075  266,549  348,564 
Income tax expense 24,912  28,520  63,378  84,245 
Net income 80,115  92,555  203,171  264,319 
Other comprehensive loss        
Net unrealized holding losses arising during period on debt securities available-for-sale, net of tax benefit of $(3,472), $(10,128), $(4,871) and $(17,631)
 (10,200) (38,099) (14,311) (66,324)
Total other comprehensive loss (10,200) (38,099) (14,311) (66,324)
Comprehensive income $ 69,915  $ 54,456  $ 188,860  $ 197,995 
Basic earnings per common share $ 1.16  $ 1.34  $ 2.94  $ 3.82 
Diluted earnings per common share $ 1.16  $ 1.34  $ 2.94  $ 3.81 
Weighted average common shares outstanding        
Basic 68,879  69,125  69,023  69,213 
Diluted 68,994  69,327  69,130  69,428 
See notes to unaudited consolidated financial statements.
2

AMERIS BANCORP AND SUBSIDIARIES
Consolidated Statements of Shareholders’ Equity (unaudited)
(dollars in thousands)

Three Months Ended September 30, 2023
Common Stock Capital Surplus Retained Earnings Accumulated Other Comprehensive Income (Loss), Net of Tax Treasury Stock Total Shareholders' Equity
Shares Amount Shares Amount
Balance, June 30, 2023 72,514,630  $ 72,515  $ 1,939,865  $ 1,414,742  $ (50,618) 3,374,847  $ (91,874) $ 3,284,630 
Issuance of restricted shares 1,500  2  (2) —  —  —  —  — 
Forfeitures of restricted shares (2,083) (3) (30) —  —  —  —  (33)
Share-based compensation —  —  3,019  —  —  —  —  3,019 
Purchase of treasury shares —  —  —  —  —  739  (29) (29)
Net income —  —  —  80,115  —  —  —  80,115 
Dividends on common shares ($0.15 per share)
 —  —  —  (10,433) —  —  —  (10,433)
Other comprehensive loss during the period —  —  —  —  (10,200) —  —  (10,200)
Balance, September 30, 2023 72,514,047  $ 72,514  $ 1,942,852  $ 1,484,424  $ (60,818) 3,375,586  $ (91,903) $ 3,347,069 
Nine Months Ended September 30, 2023
Common Stock Capital Surplus Retained Earnings Accumulated Other Comprehensive Income (Loss), Net of Tax Treasury Stock Total Shareholders' Equity
Shares Amount Shares Amount
Balance, December 31, 2022 72,263,727  $ 72,264  $ 1,935,211  $ 1,311,258  $ (46,507) 2,894,677  $ (74,826) $ 3,197,400 
Issuance of restricted shares 133,430  134  (134) —  —  —  —  — 
Issuance of common shares pursuant to PSU agreements 102,973  103  (103) —  —  —  —  — 
Forfeitures of restricted shares (2,083) (3) (30) —  —  —  —  (33)
Proceeds from exercise of stock options 16,000  16  460  —  —  —  —  476 
Share-based compensation —  —  7,448  —  —  —  —  7,448 
Purchase of treasury shares —  —  —  —  —  480,909  (17,077) (17,077)
Net income —  —  —  203,171  —  —  —  203,171 
Dividends on common shares ($0.45 per share)
 —  —  —  (31,282) —  —  —  (31,282)
Cumulative effect of change in accounting principle for ASU 2022-02 —  —  —  1,277  —  —  —  1,277 
Other comprehensive loss during the period —  —  —  —  (14,311) —  —  (14,311)
Balance, September 30, 2023 72,514,047  $ 72,514  $ 1,942,852  $ 1,484,424  $ (60,818) 3,375,586  $ (91,903) $ 3,347,069 


3

Three Months Ended September 30, 2022
Common Stock Capital Surplus Retained Earnings Accumulated Other Comprehensive Income (Loss), Net of Tax Treasury Stock Total Shareholders' Equity
Shares Amount Shares Amount
Balance, June 30, 2022 72,251,856  $ 72,251  $ 1,931,088  $ 1,157,359  $ (12,635) 2,891,395  $ (74,687) $ 3,073,376 
Forfeitures of restricted shares (4,470) (4) (38) —  —  —  —  (42)
Share-based compensation —  —  1,856  —  —  —  —  1,856 
Purchase of treasury shares —  —  —  —  —  3,282  (139) (139)
Net income —  —  —  92,555  —  —  —  92,555 
Dividends on common shares ($0.15 per share)
 —  —  —  (10,437) —  —  —  (10,437)
Other comprehensive loss during the period —  —  —  —  (38,099) —  —  (38,099)
Balance, September 30, 2022 72,247,386  $ 72,247  $ 1,932,906  $ 1,239,477  $ (50,734) 2,894,677  $ (74,826) $ 3,119,070 
Nine Months Ended September 30, 2022
Common Stock Capital Surplus Retained Earnings Accumulated Other Comprehensive Income (Loss), Net of Tax Treasury Stock Total Shareholders' Equity
Shares Amount Shares Amount
Balance, December 31, 2021 72,017,126  $ 72,017  $ 1,924,813  $ 1,006,436  $ 15,590  2,407,898  $ (52,405) $ 2,966,451 
Issuance of restricted shares 164,346  164  1,177  —  —  —  —  1,341 
Forfeitures of restricted shares (13,889) (14) (119) —  —  —  —  (133)
Proceeds from exercise of stock options 79,803  80  2,244  —  —  —  —  2,324 
Share-based compensation —  —  4,791  —  —  —  —  4,791 
Purchase of treasury shares —  —  —  —  —  486,779  (22,421) (22,421)
Net income —  —  —  264,319  —  —  —  264,319 
Dividends on common shares ($0.45 per share)
 —  —  —  (31,278) —  —  —  (31,278)
Other comprehensive loss during the period —  —  —  —  (66,324) —  —  (66,324)
Balance, September 30, 2022 72,247,386  $ 72,247  $ 1,932,906  $ 1,239,477  $ (50,734) 2,894,677  $ (74,826) $ 3,119,070 

See notes to unaudited consolidated financial statements. 
4

AMERIS BANCORP AND SUBSIDIARIES
Consolidated Statements of Cash Flows (unaudited)
(dollars in thousands)
  Nine Months Ended
September 30,
  2023 2022
Operating Activities    
Net income $ 203,171  $ 264,319 
Adjustments reconciling net income to net cash provided by (used in) operating activities:    
Depreciation 14,260  13,808 
Net losses on sale or disposal of premises and equipment 97  92 
Provision for credit losses 119,704  38,807 
Net write-downs and (gains) losses on sale of other real estate owned (1,597) (1,773)
Share-based compensation expense 7,415  4,859 
Amortization of intangible assets 13,819  15,035 
Amortization of operating lease right of use assets 8,440  8,783 
Provision for deferred taxes (13,382) (21,699)
Net (accretion) amortization of debt securities available-for-sale (4,316) 407 
Net (accretion) amortization of debt securities held-to-maturity (136) 71 
Net amortization of other investments 1,108  556 
Net (gain) loss on securities 16  (200)
Accretion of discount on purchased loans, net (1,361) (30)
Net amortization on other borrowings 774  324 
Amortization of subordinated deferrable interest debentures 1,495  1,495 
Loan servicing asset recovery —  (21,824)
Originations of mortgage loans held for sale (2,818,898) (3,265,190)
Payments received on mortgage loans held for sale 11,806  21,657 
Proceeds from sales of mortgage loans held for sale 2,802,956  3,919,672 
Net losses on sale of mortgage loans held for sale 4,447  83,975 
Originations of SBA loans (24,252) (44,664)
Proceeds from sales of SBA loans 27,129  53,961 
Net gains on sale of SBA loans (1,382) (5,191)
Increase in cash surrender value of bank owned life insurance (6,768) (5,433)
Gain on bank owned life insurance proceeds (486) (55)
Loss on sale of mortgage servicing rights —  316 
Gain on debt redemption (1,148) — 
Change attributable to other operating activities 13,157  711 
Net cash provided by operating activities 356,068  1,062,789 
Investing Activities, net of effects of business combinations    
Purchases of debt securities available-for-sale (500) (894,260)
Purchases of debt securities held-to-maturity (8,543) (52,111)
Proceeds from maturities and paydowns of debt securities available-for-sale 61,394  147,291 
Proceeds from sales of debt securities available-for-sale 216  — 
Proceeds from maturities and paydowns of debt securities held-to-maturity 1,684  1,676 
Net (increase) decrease in other investments 4,911  (13,364)
Net increase in loans (400,486) (2,764,936)
Purchases of premises and equipment (11,680) (11,307)
Proceeds from sale of premises and equipment 42  46 
Proceeds from sales of other real estate owned 8,756  5,086 
Proceeds from sale of mortgage servicing rights —  119,845 
Purchases of bank owned life insurance —  (50,000)
Proceeds from bank owned life insurance 1,890  101 
Net cash and cash equivalents paid in acquisitions —  (14,003)
Net cash used in investing activities (342,316) (3,525,936)
    (Continued)

5

AMERIS BANCORP AND SUBSIDIARIES
Consolidated Statements of Cash Flows (unaudited)
(dollars in thousands)
  Nine Months Ended
September 30,
  2023 2022
Financing Activities, net of effects of business combinations    
Net increase (decrease) in deposits $ 1,127,607  $ (198,634)
Net decrease in securities sold under agreements to repurchase —  (5,845)
Proceeds from other borrowings 13,837,000  350,000 
Repayment of other borrowings (14,502,809) (364,539)
Proceeds from exercise of stock options 476  2,324 
Dividends paid - common stock (31,308) (31,227)
Purchase of treasury shares (17,077) (22,421)
Net cash provided by (used in) financing activities 413,889  (270,342)
Net increase (decrease) in cash, cash equivalents and restricted cash 427,641  (2,733,489)
Cash, cash equivalents and restricted cash at beginning of period 1,118,132  4,064,657 
Cash, cash equivalents and restricted cash at end of period $ 1,545,773  $ 1,331,168 
Supplemental Disclosures of Cash Flow Information    
Cash paid (received) during the period for:    
Interest $ 290,972  $ 42,040 
Income taxes 88,353  82,551 
Loans transferred to other real estate owned 9,713  346 
Loans transferred from loans held for sale to loans held for investment 8,806  192,425 
Loans provided for the sales of other real estate owned —  2,288 
Right-of-use assets obtained in exchange for new operating lease liabilities 2,678  1,537 
Assets acquired in business acquisitions —  10,641 
Liabilities assumed in business acquisitions —  (3,362)
Change in unrealized loss on securities available-for-sale, net of tax (14,311) (66,324)
    (Concluded)

See notes to unaudited consolidated financial statements.

6

AMERIS BANCORP AND SUBSIDIARIES
Notes to Unaudited Consolidated Financial Statements
September 30, 2023
 
NOTE 1 – BASIS OF PRESENTATION AND ACCOUNTING POLICIES

Nature of Business

Ameris Bancorp (the “Company” or “Ameris”) is a financial holding company headquartered in Atlanta, Georgia. Ameris conducts substantially all of its operations through its wholly owned banking subsidiary, Ameris Bank (the “Bank”). At September 30, 2023, the Bank operated 164 branches in select markets in Georgia, Alabama, Florida, North Carolina and South Carolina. Our business model capitalizes on the efficiencies of a large financial services company, while still providing the community with the personalized banking service expected by our customers. We manage our Bank through a balance of decentralized management responsibilities and efficient centralized operating systems, products and loan underwriting standards. The Company’s Board of Directors and senior managers establish corporate policy, strategy and administrative policies. Within our established guidelines and policies, the banker closest to the customer responds to the differing needs and demands of his or her unique market.

Basis of Presentation

The accompanying unaudited consolidated financial statements for Ameris have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and Regulation S-X. Accordingly, the financial statements do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America (“GAAP”) for complete financial statement presentation. The interim consolidated financial statements included herein are unaudited but reflect all adjustments, consisting of normal recurring adjustments, which, in the opinion of management, are necessary for a fair presentation of the consolidated financial position and results of operations for the interim periods presented. All significant intercompany accounts and transactions have been eliminated in consolidation. The results of operations for the three and nine months ended September 30, 2023 are not necessarily indicative of the results to be expected for the full year. These financial statements should be read in conjunction with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022.

In preparing the consolidated financial statements in conformity with GAAP, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the balance sheet and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Cash and Cash Equivalents

For purposes of reporting cash flows, cash and cash equivalents include cash on hand, cash items in process of collection, amounts due from banks, interest-bearing deposits in banks, federal funds sold and restricted cash. There was no restricted cash held at both September 30, 2023 and December 31, 2022.

Reclassifications

Certain reclassifications of prior year amounts have been made to conform with the current year presentations. The reclassifications had no effect on net income or shareholders' equity as previously reported.

Accounting Standards Adopted in 2023

ASU No. 2022-02 – Financial Instruments - Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures ("ASU 2022-02"). ASU 2022-02 eliminates the troubled debt restructuring ("TDR") measurement and recognition guidance and requires that entities evaluate whether the modification represents a new loan or a continuation of an existing loan consistent with the accounting for other loan modifications. Additional disclosures relating to modifications to borrowers experiencing financial difficulty are required under ASU 2022-02. ASU 2022-02 also requires disclosure of current-period gross write-offs by year of origination. The Company adopted this ASU effective January 1, 2023 on a prospective basis, except for the amendments related to recognition and measurement of TDRs, which were adopted using the modified retrospective method. The adoption was not material and resulted in a reduction to the allowance for credit losses of $1.7 million and an increase to retained earnings of $1.3 million.

7

ASU No. 2022-06 - Reference Rate Reform (Topic 848): Deferral of the Sunset Date of Topic 848. ASU No. 2022-06 extends the temporary relief in Topic 848 from December 31, 2022 to December 31, 2024. Topic 848 provides optional guidance to ease the potential burden in accounting for or recognizing the effects of reference rate reform on financial reporting. The objective of this guidance is to provide temporary relief during the transition period away from LIBOR toward new interest rate benchmarks. This update was effective upon issuance. The Company adopted the guidance in Topic 848 effective January 1, 2023 and the adoption was not material to the consolidated financial statements.

NOTE 2 – INVESTMENT SECURITIES

The amortized cost and estimated fair value of securities available-for-sale along with gross unrealized gains and losses are summarized as follows:

(dollars in thousands)
Securities available-for-sale
 Amortized
Cost		 Allowance for Credit Losses Gross
Unrealized
Gains		 Gross
Unrealized
Losses		 Estimated
Fair
Value
September 30, 2023
U.S. Treasuries $ 781,154  $ —  $ —  $ (20,558) $ 760,596 
U.S. government-sponsored agencies 1,026  —  —  (57) 969 
State, county and municipal securities 29,492  —  —  (1,789) 27,703 
Corporate debt securities 16,171  (80) —  (1,055) 15,036 
SBA pool securities 23,834  —  2  (2,085) 21,751 
Mortgage-backed securities 650,535  —  16  (52,525) 598,026 
Total debt securities available-for-sale $ 1,502,212  $ (80) $ 18  $ (78,069) $ 1,424,081 
December 31, 2022
U.S. Treasuries $ 775,784  $ —  $ 131  $ (16,381) $ 759,534 
U.S. government-sponsored agencies 1,036  —  —  (57) 979 
State, county and municipal securities 35,358  —  17  (1,180) 34,195 
Corporate debt securities 16,397  (75) —  (396) 15,926 
SBA pool securities 29,422  —  3  (2,027) 27,398 
Mortgage-backed securities 701,008  —  113  (39,093) 662,028 
Total debt securities available-for-sale $ 1,559,005  $ (75) $ 264  $ (59,134) $ 1,500,060 

The amortized cost and estimated fair value of securities held-to-maturity along with gross unrealized gains and losses are summarized as follows:

(dollars in thousands)
Securities held-to-maturity
 Amortized
Cost		 Gross
Unrealized
Gains		 Gross
Unrealized
Losses		 Estimated
Fair
Value
September 30, 2023
State, county and municipal securities $ 31,905  $ —  $ (7,350) $ 24,555 
Mortgage-backed securities 109,954  —  (18,820) 91,134 
Total debt securities held-to-maturity $ 141,859  $ —  $ (26,170) $ 115,689 
December 31, 2022
State, county and municipal securities $ 31,905  $ —  $ (5,380) $ 26,525 
Mortgage-backed securities 102,959  —  (14,946) 88,013 
Total debt securities held-to-maturity $ 134,864  $ —  $ (20,326) $ 114,538 

The amortized cost and estimated fair value of debt securities available-for-sale and held-to-maturity as of September 30, 2023, by contractual maturity are shown below. Maturities may differ from contractual maturities in mortgage-backed securities because the mortgages underlying these securities may be called or repaid without penalty.
8

Therefore, these securities are not included in the maturity categories in the following maturity summary:

Available-for-Sale Held-to-Maturity
(dollars in thousands)
 Amortized
Cost		 Estimated Fair Value Amortized
Cost		 Estimated Fair Value
Due in one year or less $ 380,435  $ 375,844  $ —  $ — 
Due from one year to five years 439,956  422,385  —  — 
Due from five to ten years 10,753  9,897  —  — 
Due after ten years 20,533  17,929  31,905  24,555 
Mortgage-backed securities 650,535  598,026  109,954  91,134 
  $ 1,502,212  $ 1,424,081  $ 141,859  $ 115,689 

Securities with a carrying value of approximately $827.9 million and $861.6 million at September 30, 2023 and December 31, 2022, respectively, serve as collateral to secure public deposits and for other purposes required or permitted by law.

The following table shows the gross unrealized losses and estimated fair value of available-for-sale securities aggregated by category and length of time that securities have been in a continuous unrealized loss position at September 30, 2023 and December 31, 2022:

  Less Than 12 Months 12 Months or More Total
(dollars in thousands)
Securities available-for-sale
 Estimated
Fair
Value		 Unrealized
Losses		 Estimated
Fair
Value		 Unrealized
Losses		 Estimated
Fair
Value		 Unrealized
Losses
September 30, 2023            
U.S. Treasuries $ 230,519  $ (2,956) $ 530,077  $ (17,602) $ 760,596  $ (20,558)
U.S. government-sponsored agencies —  —  969  (57) 969  (57)
State, county and municipal securities 6,739  (135) 19,549  (1,654) 26,288  (1,789)
Corporate debt securities 491  (9) 13,045  (1,046) 13,536  (1,055)
SBA pool securities 43  —  21,547  (2,085) 21,590  (2,085)
Mortgage-backed securities 22,744  (834) 573,996  (51,691) 596,740  (52,525)
Total debt securities available-for-sale $ 260,536  $ (3,934) $ 1,159,183  $ (74,135) $ 1,419,719  $ (78,069)
December 31, 2022            
U.S. Treasuries $ 725,250  $ (16,381) $ —  $ —  $ 725,250  $ (16,381)
U.S. government sponsored agencies 979  (57) —  —  979  (57)
State, county and municipal securities 27,438  (1,180) —  —  27,438  (1,180)
Corporate debt securities 13,271  (126) 1,155  (270) 14,426  (396)
SBA pool securities 17,806  (1,298) 9,329  (729) 27,135  (2,027)
Mortgage-backed securities 620,544  (37,774) 16,847  (1,319) 637,391  (39,093)
Total debt securities available-for-sale $ 1,405,288  $ (56,816) $ 27,331  $ (2,318) $ 1,432,619  $ (59,134)

As of September 30, 2023, the Company’s available-for-sale security portfolio consisted of 419 securities, 412 of which were in an unrealized loss position. At September 30, 2023, the Company held 320 mortgage-backed securities that were in an unrealized loss position, all of which were issued by U.S. government-sponsored entities and agencies. At September 30, 2023, the Company held 30 U.S. Small Business Administration (“SBA”) pool securities, 27 state, county and municipal securities, six corporate securities, one U.S. government-sponsored agency security, and 28 U.S. Treasury securities that were in an unrealized loss position.

9

The following table shows the gross unrealized losses and estimated fair value of held-to-maturity securities aggregated by category and length of time that securities have been in a continuous unrealized loss position at September 30, 2023 and December 31, 2022:

  Less Than 12 Months 12 Months or More Total
(dollars in thousands)
Securities held-to-maturity
 Estimated
Fair
Value		 Unrealized
Losses		 Estimated
Fair
Value		 Unrealized
Losses		 Estimated
Fair
Value		 Unrealized
Losses
September 30, 2023
State, county and municipal securities $ —  $ —  $ 24,555  $ (7,350) $ 24,555  $ (7,350)
Mortgage-backed securities 12,794  (1,046) 78,340  (17,774) 91,134  (18,820)
Total debt securities held-to-maturity $ 12,794  $ (1,046) $ 102,895  $ (25,124) $ 115,689  $ (26,170)
December 31, 2022
State, county and municipal securities $ 16,512  $ (1,488) $ 10,013  $ (3,892) $ 26,525  $ (5,380)
Mortgage-backed securities 32,471  (1,925) 55,542  (13,021) 88,013  (14,946)
Total debt securities held-to-maturity $ 48,983  $ (3,413) $ 65,555  $ (16,913) $ 114,538  $ (20,326)

As of September 30, 2023, the Company’s held-to-maturity security portfolio consisted of 27 securities, all of which were in an unrealized loss position. At September 30, 2023, the Company held 21 mortgage-backed securities and six state, county and municipal securities that were in an unrealized loss position.

At September 30, 2023 and December 31, 2022, all of the Company’s mortgage-backed securities were obligations of government-sponsored agencies.

Management and the Company’s Asset and Liability Committee (the “ALCO Committee”) evaluate available-for-sale securities in an unrealized loss position on at least a quarterly basis, and more frequently when economic or market concerns warrant such evaluation, to determine if credit-related impairment exists. Management first evaluates whether they intend to sell or more likely than not will be required to sell an impaired security before recovering its amortized cost basis. If either criteria is met, the entire amount of unrealized loss is recognized in earnings with a corresponding adjustment to the security's amortized cost basis. If either of the above criteria is not met, management evaluates whether the decline in fair value is attributable to credit or resulted from other factors. The Company does not intend to sell these available-for-sale investment securities at an unrealized loss position at September 30, 2023, and it is more likely than not that the Company will not be required to sell these securities prior to recovery or maturity. Based on the results of management's review, at September 30, 2023, management determined that $80,000 was attributable to credit impairment and an allowance for credit losses was recorded. The remaining $78.1 million in unrealized loss was determined to be from factors other than credit.

(dollars in thousands) Three Months Ended September 30, Nine Months Ended September 30,
Allowance for credit losses
 2023 2022 2023 2022
Beginning balance $ 82  $ 88  $ 75  $ — 
Provision for other credit losses (2) (9) 5  79 
Ending balance $ 80  $ 79  $ 80  $ 79 

The Company's held-to-maturity securities have no expected credit losses, and no related allowance for credit losses has been established.

10

The following table is a summary of sales activities in the Company's debt securities available for sale for the three and nine months ended September 30, 2023 and 2022:

Three Months Ended September 30, Nine Months Ended September 30,
(dollars in thousands) 2023 2022 2023 2022
Gross gains on sales of securities $ —  $ —  $ —  $ — 
Gross losses on sales of securities —  —  —  — 
Net realized gains (losses) on sales of debt securities available for sale $ —  $ —  $ —  $ — 
Sales proceeds $ 216  $ —  $ 216  $ — 

Total net gain (loss) on securities reported on the consolidated statements of income and comprehensive income is comprised of the following for the three and nine months ended September 30, 2023 and 2022:

Three Months Ended September 30, Nine Months Ended September 30,
(dollars in thousands) 2023 2022 2023 2022
Unrealized holding gains (losses) on equity securities $ (16) $ (21) $ (16) $ (70)
Net realized gains on sales of other investments —  —  —  270 
Net gain (loss) on securities $ (16) $ (21) $ (16) $ 200 

NOTE 3 – LOANS AND ALLOWANCE FOR CREDIT LOSSES

Loans are stated at amortized cost. Balances within the major loans receivable categories are presented in the following table:

(dollars in thousands) September 30, 2023 December 31, 2022
Commercial, financial and agricultural $ 2,632,836  $ 2,679,403 
Consumer 259,797  384,037 
Indirect automobile 47,108  108,648 
Mortgage warehouse 852,823  1,038,924 
Municipal 497,093  509,151 
Premium finance 1,007,334  1,023,479 
Real estate – construction and development 2,236,686  2,086,438 
Real estate – commercial and farmland 7,865,389  7,604,867 
Real estate – residential 4,802,013  4,420,306 
  $ 20,201,079  $ 19,855,253 

Accrued interest receivable on loans is reported in other assets on the consolidated balance sheets totaling $74.3 million and $69.3 million at September 30, 2023 and December 31, 2022, respectively. The Company had no recorded allowance for credit related to accrued interest on loans at both September 30, 2023 and December 31, 2022.

Nonaccrual and Past-Due Loans

A loan is placed on nonaccrual status when, in management’s judgment, the collection of the interest income appears doubtful. Interest receivable that has been accrued and is subsequently determined to have doubtful collectability is charged to interest income. Interest on loans that are classified as nonaccrual is subsequently applied to principal until the loans are returned to accrual status. The Company’s loan policy states that a nonaccrual loan may be returned to accrual status when (i) none of its principal and interest is due and unpaid, and the Company expects repayment of the remaining contractual principal and interest, or (ii) it otherwise becomes well secured and in the process of collection. Restoration to accrual status on any given loan must be supported by a well-documented credit evaluation of the borrower’s financial condition and the prospects for full repayment, approved by the Company’s Chief Credit Officer. Past-due loans are loans whose principal or interest is past due 30 days or more. In some cases, where borrowers are experiencing financial difficulties, loans may be restructured to provide terms significantly different from the original contractual terms.

11

The following table presents an analysis of loans accounted for on a nonaccrual basis:

(dollars in thousands) September 30, 2023 December 31, 2022
Commercial, financial and agricultural $ 7,558  $ 11,094 
Consumer 888  420 
Indirect automobile 290  346 
Real estate – construction and development 282  523 
Real estate – commercial and farmland 8,063  13,203 
Real estate – residential(1)
 117,477  109,222 
$ 134,558  $ 134,808 

(1) Included in real estate - residential were $80.8 million and $69.6 million of serviced GNMA-guaranteed nonaccrual loans at September 30, 2023 and December 31, 2022, respectively.

Interest income recognized on nonaccrual loans during the nine months ended September 30, 2023 and 2022 was not material.

The following table presents an analysis of nonaccrual loans with no related allowance for credit losses:

(dollars in thousands) September 30, 2023 December 31, 2022
Commercial, financial and agricultural $ 677  $ 33 
Consumer 285  — 
Real estate – commercial and farmland 4,133  1,464 
Real estate – residential 69,178  58,734 
$ 74,273  $ 60,231 

12

The following table presents an analysis of past-due loans as of September 30, 2023 and December 31, 2022:

(dollars in thousands) Loans
30-59
Days Past
Due		 Loans
60-89
Days
Past Due		 Loans 90
or More
Days Past
Due		 Total
Loans
Past Due		 Current
Loans		 Total
Loans		 Loans 90
Days or
More Past
Due and
Still
Accruing
September 30, 2023              
Commercial, financial and agricultural $ 12,774  $ 5,438  $ 7,064  $ 25,276  $ 2,607,560  $ 2,632,836  $ 4,765 
Consumer 2,290  804  625  3,719  256,078  259,797  — 
Indirect automobile 131  41  97  269  46,839  47,108  — 
Mortgage warehouse —  —  —  —  852,823  852,823  — 
Municipal —  —  —  —  497,093  497,093  — 
Premium finance 9,648  5,260  7,126  22,034  985,300  1,007,334  7,126 
Real estate – construction and development 892  370  280  1,542  2,235,144  2,236,686  — 
Real estate – commercial and farmland 5,358  7,128  931  13,417  7,851,972  7,865,389  — 
Real estate – residential 39,413  16,926  114,039  170,378  4,631,635  4,802,013  — 
Total $ 70,506  $ 35,967  $ 130,162  $ 236,635  $ 19,964,444  $ 20,201,079  $ 11,891 
December 31, 2022              
Commercial, financial and agricultural $ 16,219  $ 5,451  $ 11,632  $ 33,302  $ 2,646,101  $ 2,679,403  $ 3,267 
Consumer 2,539  3,163  741  6,443  377,594  384,037  472 
Indirect automobile 466  77  267  810  107,838  108,648  — 
Mortgage warehouse —  —  —  —  1,038,924  1,038,924  — 
Municipal —  —  —  —  509,151  509,151  — 
Premium finance 13,859  10,620  13,626  38,105  985,374  1,023,479  13,626 
Real estate – construction and development 25,367  3,829  966  30,162  2,056,276  2,086,438  500 
Real estate – commercial and farmland 1,738  168  10,223  12,129  7,592,738  7,604,867  — 
Real estate – residential 35,015  11,329  106,170  152,514  4,267,792  4,420,306  — 
Total $ 95,203  $ 34,637  $ 143,625  $ 273,465  $ 19,581,788  $ 19,855,253  $ 17,865 

Collateral-Dependent Loans

Collateral-dependent loans are loans where repayment is expected to be provided substantially through the operation or sale of the collateral when the borrower is experiencing financial difficulty. If the Company determines that foreclosure is probable, these loans are written down to the lower of cost or fair value of the collateral less estimated costs to sell. When repayment is expected to be from the operation of the collateral, the allowance for credit losses is calculated as the amount by which the amortized cost basis of the financial asset exceeds the present value of expected cash flows from the operation of the collateral. The Company may, in the alternative, measure the allowance for credit loss as the amount by which the amortized cost basis of the financial asset exceeds the estimated fair value of the collateral.

13

The following table presents an analysis of individually evaluated collateral-dependent financial assets and related allowance for credit losses:

September 30, 2023 December 31, 2022
(dollars in thousands) Balance Allowance for Credit Losses Balance Allowance for Credit Losses
Commercial, financial and agricultural $ 7,398  $ 2,160  $ 7,128  $ 6,294 
Premium finance —  —  3,233  — 
Real estate – construction and development 559  122  780  13 
Real estate – commercial and farmland 7,894  876  15,168  1,428 
Real estate – residential 15,963  2,000  15,464  2,066 
$ 31,814  $ 5,158  $ 41,773  $ 9,801 

Credit Quality Indicators

The Company uses a nine category risk grading system to assign a risk grade to each loan in the portfolio. The following is a description of the general characteristics of the grades:

Pass (Grades 1 - 5) – These grades represent acceptable credit risk to the Company based on factors including creditworthiness of the borrower, current performance and nature of the collateral.

Other Assets Especially Mentioned (Grade 6) – This grade includes loans that exhibit potential weaknesses that deserve management’s close attention. If left uncorrected, these weaknesses may result in deterioration of the repayment prospects for the asset or in the Company’s credit position at some future date.

Substandard (Grade 7) – This grade represents loans which are inadequately protected by the current credit worthiness and paying capacity of the borrower or of the collateral pledged, if any. These assets exhibit a well-defined weakness or are characterized by the distinct possibility that the Bank will sustain some loss if the deficiencies are not corrected. These weaknesses may be characterized by past due performance, operating losses or questionable collateral values.

Doubtful (Grade 8) – This grade includes loans which exhibit all of the characteristics of a substandard loan with the added provision that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions and values, highly questionable or improbable.

Loss (Grade 9) – This grade is assigned to loans which are considered uncollectible and of such little value that their continuance as active assets of the Bank is not warranted. This classification does not mean that the loan has absolutely no recovery or salvage value, but rather it is not practical or desirable to defer writing it off.

The following tables present the loan portfolio's amortized cost by class of financing receivable, risk grade and year of origination (in thousands) as of September 30, 2023 and December 31, 2022. Generally, current period renewals of credit are underwritten again at the point of renewal and considered current period originations for purposes of the tables below. The Company had an immaterial amount of revolving loans which converted to term loans and the amortized cost basis of those loans is included in the applicable origination year. There were no loans risk graded 8 or 9 at September 30, 2023 or December 31, 2022.
14

As of September 30, 2023
 Term Loans by Origination Year Revolving Loans Amortized Cost Basis
2023 2022 2021 2020 2019 Prior Total
Commercial, Financial and Agricultural
Risk Grade:
Pass $ 668,738  $ 817,646  $ 417,329  $ 112,503  $ 67,547  $ 51,702  $ 475,435  $ 2,610,900 
6 17  315  53  113  153  426  1,171  2,248 
7 2,387  2,661  3,536  1,448  2,912  3,368  3,376  19,688 
Total commercial, financial and agricultural $ 671,142  $ 820,622  $ 420,918  $ 114,064  $ 70,612  $ 55,496  $ 479,982  $ 2,632,836 
Current-period gross charge offs 2,920  20,026  13,793  1,316  1,228  2,760  25  42,068 
Consumer
Risk Grade:
Pass $ 42,436  $ 20,734  $ 7,289  $ 28,346  $ 17,662  $ 25,477  $ 116,578  $ 258,522 
6 —  6  —  —  —  26  4  36 
7 52  83  47  183  195  519  160  1,239 
Total consumer $ 42,488  $ 20,823  $ 7,336  $ 28,529  $ 17,857  $ 26,022  $ 116,742  $ 259,797 
Current-period gross charge offs 50  311  74  1,359  892  1,203  251  4,140 
Indirect Automobile
Risk Grade:
Pass $ —  $ —  $ —  $ —  $ 7,341  $ 39,182  $ —  $ 46,523 
6 —  —  —  —  —  1  —  1 
7 —  —  —  —  33  551  —  584 
Total indirect automobile $ —  $ —  $ —  $ —  $ 7,374  $ 39,734  $ —  $ 47,108 
Current-period gross charge offs —  —  —  —  —  135  —  135 
Mortgage Warehouse
Risk Grade:
Pass $ —  $ —  $ —  $ —  $ —  $ —  $ 817,919  $ 817,919 
6 —  —  —  —  —  —  34,904  34,904 
7 —  —  —  —  —  —  —  — 
Total mortgage warehouse $ —  $ —  $ —  $ —  $ —  $ —  $ 852,823  $ 852,823 
Current-period gross charge offs —  —  —  —  —  —  —  — 
Municipal
Risk Grade:
Pass $ 7,630  $ 22,886  $ 54,558  $ 178,659  $ 14,961  $ 218,399  $ —  $ 497,093 
Total municipal $ 7,630  $ 22,886  $ 54,558  $ 178,659  $ 14,961  $ 218,399  $ —  $ 497,093 
Current-period gross charge offs —  —  —  —  —  —  —  — 
Premium Finance
Risk Grade:
Pass $ 970,328  $ 27,170  $ 2,710  $ —  $ —  $ —  $ —  $ 1,000,208 
7 4,361  2,765  —  —  —  —  —  7,126 
Total premium finance $ 974,689  $ 29,935  $ 2,710  $ —  $ —  $ —  $ —  $ 1,007,334 
Current-period gross charge offs 310  4,600  310  —  —  —  —  5,220 
15

As of September 30, 2023
 Term Loans by Origination Year Revolving Loans Amortized Cost Basis
2023 2022 2021 2020 2019 Prior Total
Real Estate – Construction and Development
Risk Grade:
Pass $ 381,311  $ 861,269  $ 696,969  $ 131,329  $ 53,581  $ 31,230  $ 68,218  $ 2,223,907 
6 —  —  —  —  —  507  —  507 
7 —  269  303  —  —  11,700  —  12,272 
Total real estate – construction and development $ 381,311  $ 861,538  $ 697,272  $ 131,329  $ 53,581  $ 43,437  $ 68,218  $ 2,236,686 
Current-period gross charge offs —  —  —  —  —  —  —  — 
Real Estate – Commercial and Farmland
Risk Grade:
Pass $ 363,104  $ 1,820,072  $ 1,975,533  $ 1,134,332  $ 798,673  $ 1,488,013  $ 106,312  $ 7,686,039 
6 427  344  60,040  —  38,259  44,074  40  143,184 
7 —  305  449  3,604  1,490  30,318  —  36,166 
Total real estate – commercial and farmland $ 363,531  $ 1,820,721  $ 2,036,022  $ 1,137,936  $ 838,422  $ 1,562,405  $ 106,352  $ 7,865,389 
Current-period gross charge offs —  —  —  —  3,151  169  —  3,320 
Real Estate - Residential
Risk Grade:
Pass $ 628,618  $ 1,429,936  $ 1,157,750  $ 515,637  $ 246,347  $ 444,992  $ 248,504  $ 4,671,784 
6 —  187  1,115  173  622  2,980  1,492  6,569 
7 2,201  23,423  24,660  24,254  21,471  25,558  2,093  123,660 
Total real estate - residential $ 630,819  $ 1,453,546  $ 1,183,525  $ 540,064  $ 268,440  $ 473,530  $ 252,089  $ 4,802,013 
Current-period gross charge offs 24  —  9  —  —  109  89  231 
Total Loans
Risk Grade:
Pass $ 3,062,165  $ 4,999,713  $ 4,312,138  $ 2,100,806  $ 1,206,112  $ 2,298,995  $ 1,832,966  $ 19,812,895 
6 444  852  61,208  286  39,034  48,014  37,611  187,449 
7 9,001  29,506  28,995  29,489  26,101  72,014  5,629  200,735 
Total loans $ 3,071,610  $ 5,030,071  $ 4,402,341  $ 2,130,581  $ 1,271,247  $ 2,419,023  $ 1,876,206  $ 20,201,079 
Total current-period gross charge offs 3,304  24,937  14,186  2,675  5,271  4,376  365  55,114 

16

As of December 31, 2022
 Term Loans by Origination Year Revolving Loans Amortized Cost Basis
2022 2021 2020 2019 2018 Prior Total
Commercial, Financial and Agricultural
Risk Grade:
Pass $ 1,127,120  $ 526,043  $ 174,120  $ 109,091  $ 56,657  $ 41,612  $ 621,784  $ 2,656,427 
6 —  13  94  183  895  1,774  317  3,276 
7 8,565  1,214  1,182  3,314  545  2,759  2,121  19,700 
Total commercial, financial and agricultural $ 1,135,685  $ 527,270  $ 175,396  $ 112,588  $ 58,097  $ 46,145  $ 624,222  $ 2,679,403 
Consumer
Risk Grade:
Pass $ 41,487  $ 12,692  $ 37,906  $ 23,454  $ 17,144  $ 13,825  $ 236,113  $ 382,621 
6 38  —  —  —  —  98  196  332 
7 68  62  216  106  118  431  83  1,084 
Total consumer $ 41,593  $ 12,754  $ 38,122  $ 23,560  $ 17,262  $ 14,354  $ 236,392  $ 384,037 
Indirect Automobile
Risk Grade:
Pass $ —  $ —  $ —  $ 11,900  $ 50,749  $ 45,120  $ —  $ 107,769 
6 —  —  —  —  —  11  —  11 
7 —  —  —  41  149  678  —  868 
Total indirect automobile $ —  $ —  $ —  $ 11,941  $ 50,898  $ 45,809  $ —  $ 108,648 
Mortgage Warehouse
Risk Grade:
Pass $ —  $ —  $ —  $ —  $ —  $ —  $ 990,106  $ 990,106 
6 —  —  —  —  —  —  22,831  22,831 
7 —  —  —  —  —  —  25,987  25,987 
Total mortgage warehouse $ —  $ —  $ —  $ —  $ —  $ —  $ 1,038,924  $ 1,038,924 
Municipal
Risk Grade:
Pass $ 18,074  $ 46,809  $ 188,507  $ 9,752  $ 4,358  $ 241,651  $ —  $ 509,151 
Total municipal $ 18,074  $ 46,809  $ 188,507  $ 9,752  $ 4,358  $ 241,651  $ —  $ 509,151 
Premium Finance
Risk Grade:
Pass $ 1,000,214  $ 9,667  $ 12  $ —  $ —  $ —  $ —  $ 1,009,893 
7 13,051  535  —  —  —  —  —  13,586 
Total premium finance $ 1,013,265  $ 10,202  $ 12  $ —  $ —  $ —  $ —  $ 1,023,479 
Real Estate – Construction and Development
Risk Grade:
Pass $ 834,831  $ 793,723  $ 306,084  $ 69,596  $ 7,934  $ 31,490  $ 27,474  $ 2,071,132 
6 277  —  —  —  173  165  —  615 
7 —  783  164  5  13,159  580  —  14,691 
Total real estate – construction and development $ 835,108  $ 794,506  $ 306,248  $ 69,601  $ 21,266  $ 32,235  $ 27,474  $ 2,086,438 
17

As of December 31, 2022
 Term Loans by Origination Year Revolving Loans Amortized Cost Basis
2022 2021 2020 2019 2018 Prior Total
Real Estate – Commercial and Farmland
Risk Grade:
Pass $ 1,739,021  $ 1,975,003  $ 1,085,086  $ 869,116  $ 447,311  $ 1,259,763  $ 110,848  $ 7,486,148 
6 607  17,974  —  30,841  4,801  18,289  —  72,512 
7 387  2,810  3,078  12,007  6,527  21,398  —  46,207 
Total real estate – commercial and farmland $ 1,740,015  $ 1,995,787  $ 1,088,164  $ 911,964  $ 458,639  $ 1,299,450  $ 110,848  $ 7,604,867 
Real Estate - Residential
Risk Grade:
Pass $ 1,524,021  $ 1,214,724  $ 548,968  $ 268,821  $ 115,693  $ 393,570  $ 234,684  $ 4,300,481 
6 236  145  94  688  364  2,910  600  5,037 
7 6,735  21,283  25,860  27,173  14,396  17,665  1,676  114,788 
Total real estate - residential $ 1,530,992  $ 1,236,152  $ 574,922  $ 296,682  $ 130,453  $ 414,145  $ 236,960  $ 4,420,306 
Total Loans
Risk Grade:
Pass $ 6,284,768  $ 4,578,661  $ 2,340,683  $ 1,361,730  $ 699,846  $ 2,027,031  $ 2,221,009  $ 19,513,728 
6 1,158  18,132  188  31,712  6,233  23,247  23,944  104,614 
7 28,806  26,687  30,500  42,646  34,894  43,511  29,867  236,911 
Total loans $ 6,314,732  $ 4,623,480  $ 2,371,371  $ 1,436,088  $ 740,973  $ 2,093,789  $ 2,274,820  $ 19,855,253 

Allowance for Credit Losses on Loans

The allowance for credit losses represents an allowance for expected losses over the remaining contractual life of the assets. The contractual term does not consider extensions, renewals or modifications. The Company segregates the loan portfolio by type of loan and utilizes this segregation in evaluating exposure to risks within the portfolio.

Loan losses are charged against the allowance when management believes the collection of a loan’s principal is unlikely. Subsequent recoveries are credited to the allowance. Consumer loans are charged off in accordance with the Federal Financial Institutions Examination Council’s (the “FFIEC”) Uniform Retail Credit Classification and Account Management Policy. Commercial loans are charged off when they are deemed uncollectible, which usually involves a triggering event within the collection effort. If the loan is collateral dependent, the loss is more easily identified and is charged off when it is identified, usually based upon receipt of an appraisal. However, when a loan has guarantor support, the Company may carry the estimated loss as a reserve against the loan while collection efforts with the guarantor are pursued. If, after collection efforts with the guarantor are complete, the deficiency is still considered uncollectible, the loss is charged off and any further collections are treated as recoveries. In all situations, when a loan is downgraded to an Asset Quality Rating of 9 (Loss per the regulatory guidance), the uncollectible portion is charged off.

The Company’s methodologies for estimating the allowance for credit losses consider available relevant information about the collectability of cash flows, including information about past events, current conditions, and reasonable and supportable forecasts. The methodologies apply historical loss information, adjusted for asset-specific characteristics, economic conditions at the measurement date, and forecasts about future economic conditions expected to exist through the contractual lives of the financial assets that are reasonable and supportable, to the identified pools of loans with similar risk characteristics for which the historical loss experience was observed. The Company utilizes a one year reasonable and supportable forecast period. The Company’s methodologies revert back to historical loss information on a straight-line basis over four quarters after the reasonable and supportable forecast period.

During the nine months ended September 30, 2023, the allowance for credit losses increased due to a decline in forecasted macroeconomic factors, particularly residential and commercial real estate price indices and organic loan growth during the period. The allowance for credit losses was determined at both September 30, 2023 and December 31, 2022 using the Moody's baseline scenario economic forecast. The current forecast reflects, among other things, declines in forecast levels of home prices and commercial real estate prices compared with the forecast at December 31, 2022.
18

The following tables detail activity and end of period balances in the allowance for credit losses by portfolio segment for the periods indicated. Allocation of a portion of the allowance to one category of loans does not preclude its availability to absorb losses in other categories.

Three Months Ended September 30, 2023
(dollars in thousands) Commercial,
Financial and
Agricultural		 Consumer Indirect Automobile Mortgage Warehouse Municipal Premium Finance
Balance, June 30, 2023 $ 50,789  $ 4,548  $ 98  $ 2,335  $ 357  $ 776 
Provision for loan losses 14,650  310  (149) (589) (9) 183 
Loans charged off (16,519) (948) (36) —  —  (1,951)
Recoveries of loans previously charged off 4,745  203  158  —  —  1,639 
Balance, September 30, 2023 $ 53,665  $ 4,113  $ 71  $ 1,746  $ 348  $ 647 
Real Estate – Construction and Development Real Estate –
Commercial and
Farmland		 Real Estate –
Residential		 Total
Balance, June 30, 2023 $ 54,589  $ 96,140  $ 62,439  $ 272,071 
Provision for loan losses 8,525  5,453  1,721  30,095 
Loans charged off —  —  (34) (19,488)
Recoveries of loans previously charged off 74  371  236  7,426 
Balance, September 30, 2023 $ 63,188  $ 101,964  $ 64,362  $ 290,104 
Nine Months Ended September 30, 2023
(dollars in thousands) Commercial,
Financial and
Agricultural		 Consumer
Installment		 Indirect Automobile Mortgage Warehouse Municipal Premium Finance
Balance, December 31, 2022 $ 39,455  $ 5,413  $ 174  $ 2,118  $ 357  $ 1,025 
Adjustment to allowance for adoption of ASU 2022-02 (105) —  —  —  —  — 
Provision for loan losses 46,050  2,146  (567) (372) (9) 141 
Loans charged off (42,068) (4,140) (135) —  —  (5,220)
Recoveries of loans previously charged off 10,333  694  599  —  —  4,701 
Balance, September 30, 2023 $ 53,665  $ 4,113  $ 71  $ 1,746  $ 348  $ 647 
Real Estate – Construction and Development Real Estate –
Commercial and
Farmland		 Real Estate –
Residential		 Total
Balance, December 31, 2022 $ 32,659  $ 67,433  $ 57,043  $ 205,677 
Adjustment to allowance for adoption of ASU 2022-02 (37) (722) (847) (1,711)
Provision for loan losses 29,920  38,097  7,708  123,114 
Loans charged off —  (3,320) (231) (55,114)
Recoveries of loans previously charged off 646  476  689  18,138 
Balance, September 30, 2023 $ 63,188  $ 101,964  $ 64,362  $ 290,104 

19

Three Months Ended September 30, 2022
(dollars in thousands) Commercial,
Financial and
Agricultural		 Consumer Indirect Automobile Mortgage Warehouse Municipal Premium Finance
Balance, June 30, 2022 $ 25,658  $ 5,269  $ 291  $ 3,885  $ 371  $ 2,762 
Provision for loan losses 9,568  (244) (288) (1,884) (9) (638)
Loans charged off (4,722) (1,228) (50) —  —  (1,205)
Recoveries of loans previously charged off 2,201  277  276  —  —  1,023 
Balance, September 30, 2022 $ 32,705  $ 4,074  $ 229  $ 2,001  $ 362  $ 1,942 
Real Estate – Construction and Development Real Estate –
Commercial and
Farmland		 Real Estate –
Residential		 Total
Balance, June 30, 2022 $ 23,232  $ 59,349  $ 51,825  $ 172,642 
Provision for loan losses 3,227  (1,200) 8,937  17,469 
Loans charged off —  (2,014) (53) (9,272)
Recoveries of loans previously charged off 96  96  83  4,052 
Balance, September 30, 2022 $ 26,555  $ 56,231  $ 60,792  $ 184,891 
Nine Months Ended September 30, 2022
(dollars in thousands) Commercial,
Financial and
Agricultural		 Consumer
Installment		 Indirect Automobile Mortgage Warehouse Municipal Premium Finance
Balance, December 31, 2021 $ 26,829  $ 6,097  $ 476  $ 3,231  $ 401  $ 2,729 
Provision for loan losses 11,521  1,102  (884) (1,230) (39) (530)
Loans charged off (13,527) (3,790) (179) —  —  (3,640)
Recoveries of loans previously charged off 7,882  665  816  —  —  3,383 
Balance, September 30, 2022 $ 32,705  $ 4,074  $ 229  $ 2,001  $ 362  $ 1,942 
Real Estate – Construction and Development Real Estate –
Commercial and
Farmland		 Real Estate –
Residential		 Total
Balance, December 31, 2021 $ 22,045  $ 77,831  $ 27,943  $ 167,582 
Provision for loan losses 3,841  (18,399) 32,580  27,962 
Loans charged off —  (3,378) (190) (24,704)
Recoveries of loans previously charged off 669  177  459  14,051 
Balance, September 30, 2022 $ 26,555  $ 56,231  $ 60,792  $ 184,891 

Modifications to Borrowers Experiencing Financial Difficulty

The Company periodically provides modifications to borrowers experiencing financial difficulty. These modifications include either payment deferrals, term extensions, interest rate reductions, principal forgiveness or combinations of modification types. The determination of whether the borrower is experiencing financial difficulty is made on the date of the modification. When principal forgiveness is provided, the amount of principal forgiveness is charged off against the allowance for credit losses with a corresponding reduction in the amortized cost basis of the loan.

The following table shows the amortized cost basis of the loans modified to borrowers experiencing financial difficulty, disaggregated by class of financing receivable and type of concession granted as of September 30, 2023:

20

(dollars in thousands) Payment Deferral Term Extension Interest Rate Reduction Combination of Term Extension and Rate Reduction Total Percentage of Total Class of Financial Receivable
Commercial, financial and agricultural $ 1,180  $ 2,502  $ —  $ —  $ 3,682  0.1  %
Real estate – construction and development —  278  —  —  278  —  %
Real estate – commercial and farmland —  1,197  832  —  2,029  —  %
Real estate – residential 1,033  3,165  —  348  4,546  0.1  %
Total $ 2,213  $ 7,142  $ 832  $ 348  $ 10,535  0.1  %
The Company has unfunded commitments of $480,000 to borrowers experiencing financial difficulty for which the Company has modified their loans.

The following table describes the financial effect of the modifications made to borrowers experiencing financial difficulty during the nine months ended September 30, 2023:

Payment Deferral
Loan Type Financial Effect
Commercial, financial and agricultural
Payments were reduced approximately 32% for three months before returning to a fully amortizing payment structure thereafter.
Commercial, financial and agricultural
Payments were reduced approximately 73% for four months before requiring full repayment.
Real estate – residential Payments were deferred for a weighted average of four months
Term Extension
Loan Type Financial Effect
Commercial, financial and agricultural
Maturity dates were extended for a weighted average of 10 months.
Real estate – construction and development
Maturity date was extended for 11 months.
Real estate – commercial and farmland
Maturity dates were extended for an average of 12 months.
Real estate - residential
Maturity dates were extended for a weighted average of 92 months
Interest Rate Reduction
Loan Type Financial Effect
Real estate – commercial and farmland
Interest rate was reduced by 4.75%
Combination of Term Extension and Rate Reduction
Loan Type Financial Effect
Real estate - residential
Maturity date was extended 58 months and rate was reduced by 1.375%

The Company monitors the performance of the loans that are modified to borrowers experiencing financial difficulty to understand the effectiveness of its modification efforts. The following table depicts the performance of loans that have been modified in the last 12 months:

(dollars in thousands) Current 30-59
Days Past Due		 60-89
Days Past Due		 90 or More Days Past Due Total
Commercial, financial and agricultural $ 2,385  $ —  $ 815  $ 482  $ 3,682 
Real estate – construction and development —  278  —  —  278 
Real estate – commercial and farmland 1,529  —  —  500  2,029 
Real estate – residential 3,262  1,284  —  —  4,546 
Total $ 7,176  $ 1,562  $ 815  $ 982  $ 10,535 

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The following table provides the amortized cost basis of financing receivables that had a payment default during both the three and nine months ended September 30, 2023 and were modified in the 12 months before default to borrowers experiencing financial difficulty.

(dollars in thousands) Term Extension Payment Deferral
Commercial, financial and agricultural $ 482  $ 815 
Real estate – construction and development 278  — 
Real estate – commercial and farmland 500  — 
Real estate – residential 1,090  194 
Total $ 2,350  $ 1,009 
22

NOTE 4 – OTHER BORROWINGS

Other borrowings consist of the following:
(dollars in thousands) September 30, 2023 December 31, 2022
FHLB borrowings:    
Fixed Rate Advance due January 9, 2023; fixed interest rate of 4.150%
 $ —  $ 300,000 
Fixed Rate Advance due January 9, 2023; fixed interest rate of 4.110%
 —  50,000 
Fixed Rate Advance due January 12, 2023; fixed interest rate of 4.140%
 —  50,000 
Fixed Rate Advance due January 13, 2023; fixed interest rate of 4.150%
 —  50,000 
Fixed Rate Advance due January 17, 2023; fixed interest rate of 4.170%
 —  350,000 
Fixed Rate Advance due January 17, 2023; fixed interest rate of 4.250%
 —  150,000 
Fixed Rate Advance due January 18, 2023; fixed interest rate of 4.260%
 —  200,000 
Fixed Rate Advance due January 19, 2023; fixed interest rate of 4.230%
 —  50,000 
Fixed Rate Advance due January 20, 2023; fixed interest rate of 4.220%
 —  150,000 
Fixed Rate Advance due January 27, 2023; fixed interest rate of 4.230%
 —  100,000 
Fixed Rate Advance due October 16, 2023; fixed interest rate of 5.460%
 75,000  — 
Fixed Rate Advance due October 16, 2023; fixed interest rate of 5.470%
 200,000  — 
Fixed Rate Advance due October 18, 2023; fixed interest rate of 5.470%
 150,000  — 
Fixed Rate Advance due October 18, 2023; fixed interest rate of 5.470%
 100,000  — 
Fixed Rate Advance due October 19, 2023; fixed interest rate of 5.470%
 75,000  — 
Fixed Rate Advance due October 20, 2023; fixed interest rate of 5.460%
 250,000  — 
Fixed Rate Advance due March 3, 2025; fixed interest rate of 1.208%
 15,000  15,000 
Fixed Rate Advance due March 2, 2027; fixed interest rate of 1.445%
 15,000  15,000 
Fixed Rate Advance due March 4, 2030; fixed interest rate of 1.606%
 15,000  15,000 
Fixed Rate Advance due December 9, 2030; fixed interest rate of 4.55%
 1,380  1,389 
Fixed Rate Advance due December 9, 2030; fixed interest rate of 4.55%
 956  961 
Principal Reducing Advance due September 29, 2031; fixed interest rate of 3.095%
 1,166  1,275 
Subordinated notes payable:    
Subordinated notes payable due March 15, 2027 net of unamortized debt issuance cost of $0 and $551, respectively; fixed interest rate of 5.75% through March 14, 2022; variable interest rate thereafter at three-month LIBOR plus 3.616%
 —  74,449 
Subordinated notes payable due December 15, 2029 net of unamortized debt issuance cost of $1,350 and $1,680, respectively; fixed interest rate of 4.25% through December 14, 2024; variable interest rate thereafter at three-month SOFR plus 2.94%
 106,650  118,320 
Subordinated notes payable due May 31, 2030 net of unaccreted purchase accounting fair value adjustment of $814 and $906, respectively; fixed interest rate of 5.875% through May 31, 2025; variable interest rate thereafter at three-month LIBOR plus 3.63%
 75,814  75,906 
Subordinated notes payable due October 1, 2030 net of unamortized debt issuance cost of $1,413 and $1,564, respectively; fixed interest rate of 3.875% through September 30, 2025; variable interest rate thereafter at three-month SOFR plus 3.753%
 108,587  108,436 
Other Debt:
Advance from correspondent bank due November 28, 2024; secured by a loan receivable; variable interest rate at one-month SOFR plus 2.50%
 10,000  — 
Advance from correspondent bank due December 1, 2025; secured by a loan receivable; variable interest rate at one-month SOFR plus 2.65%
 10,000  — 
$ 1,209,553  $ 1,875,736 

The advances from the FHLB are collateralized by a blanket lien on all eligible first mortgage loans and other specific loans in addition to FHLB stock. At September 30, 2023, $3.62 billion was available for borrowing on lines with the FHLB.

As of September 30, 2023, the Bank maintained credit arrangements with various financial institutions to purchase federal funds up to $127.0 million.

The Bank also participates in the Federal Reserve discount window borrowings program. At September 30, 2023, the Bank had $3.60 billion of loans pledged at the Federal Reserve discount window and had $2.63 billion available for borrowing.

23

NOTE 5 – ACCUMULATED OTHER COMPREHENSIVE INCOME

Accumulated other comprehensive income (loss) for the Company consists of changes in net unrealized gains and losses on debt securities available-for-sale. The reclassification for gains included in net income is recorded in net gain (loss) on securities in the consolidated statement of income and comprehensive income.

The following table presents a summary of the accumulated other comprehensive income (loss) balances, net of tax, for the periods indicated:

(dollars in thousands) Accumulated
Other Comprehensive
Income (Loss)
Three Months Ended September 30, 2023
Balance, June 30, 2023 $ (50,618)
Unrealized loss on debt securities available-for-sales, net of tax (10,200)
Balance, September 30, 2023 $ (60,818)
Three Months Ended September 30, 2022
Balance, June 30, 2022 $ (12,635)
Unrealized loss on debt securities available-for-sales, net of tax (38,099)
Balance, September 30, 2022 $ (50,734)
Nine Months Ended September 30, 2023
Balance, December 31, 2022 $ (46,507)
Unrealized loss on debt securities available-for-sales, net of tax (14,311)
Balance, September 30, 2023 $ (60,818)
Nine Months Ended September 30, 2022
Balance, December 31, 2021 $ 15,590 
Unrealized loss on debt securities available-for-sales, net of tax (66,324)
Balance, September 30, 2022 $ (50,734)

NOTE 6 – WEIGHTED AVERAGE SHARES OUTSTANDING

Earnings per share have been computed based on the following weighted average number of common shares outstanding:

  Three Months Ended
September 30,		 Nine Months Ended
September 30,
(share data in thousands) 2023 2022 2023 2022
Average common shares outstanding 68,879  69,125  69,023  69,213 
Common share equivalents:
Stock options —  11  —  20 
Nonvested restricted share grants 47  59  52  73 
Performance stock units 68  132  55  122 
Average common shares outstanding, assuming dilution 68,994  69,327  69,130  69,428 


There were 84.487 anti-dilutive securities excluded from the computation of earnings per share for the nine months ended September 30, 2023. There were no anti-dilutive securities excluded from the computation of earnings per share for the three months ended September 30, 2023, and for the three and nine months ended September 30, 2022.


NOTE 7 – FAIR VALUE MEASURES

The fair value of an asset or liability is the current amount that would be exchanged between willing parties, other than in a forced liquidation. Fair value is best determined based upon quoted market prices. However, in many instances, there are no quoted market prices for the Company’s various assets and liabilities.
24

In cases where quoted market prices are not available, fair value is based on discounted cash flows or other valuation techniques. These techniques are significantly affected by the assumptions used, including the discount rate and estimates of future cash flows. Accordingly, the fair value estimates may not be realized in an immediate settlement of the asset or liability. The accounting standard for disclosures about the fair value measures excludes certain financial instruments and all nonfinancial instruments from its disclosure requirements. Accordingly, the aggregate fair value amounts presented may not necessarily represent the underlying fair value of the Company.

The Company's loans held for sale under the fair value option are comprised of the following:

(dollars in thousands) September 30, 2023 December 31, 2022
Mortgage loans held for sale $ 381,466  $ 390,583 
SBA loans held for sale —  1,495 
Total loans held for sale $ 381,466  $ 392,078 

The Company has elected to record mortgage loans held for sale at fair value in order to eliminate the complexities and inherent difficulties of achieving hedge accounting and to better align reported results with the underlying economic changes in value of the loans and related hedge instruments. This election impacts the timing and recognition of origination fees and costs, as well as servicing value, which are now recognized in earnings at the time of origination. Interest income on mortgage loans held for sale is recorded on an accrual basis in the consolidated statements of income and comprehensive income under the heading interest income – interest and fees on loans. The servicing value is included in the fair value of the interest rate lock commitments (“IRLCs”) with borrowers. The mark to market adjustments related to mortgage loans held for sale and the associated economic hedges are captured in mortgage banking activities.

Net losses of $3.2 million and $857,000 resulting from changes in fair value of these mortgage loans were recorded in income during the three and nine months ended September 30, 2023, respectively. For the three and nine months ended September 30, 2022, net losses of $11.9 million and $44.7 million, respectively, resulting from changes in fair value of these mortgage loans were recorded in income. A net loss of $207,000 and a net gain of $4.9 million resulting from changes in the fair value of the related derivative financial instruments used to hedge exposure to the market-related risks associated with these mortgage loans were recorded in income during the three and nine months ended September 30, 2023, respectively. For the three and nine months ended September 30, 2022, net gains of $11.7 million and $10.5 million, respectively, resulting from changes in the fair value of the related derivative financial instruments were recorded in income. The changes in fair value of both mortgage loans held for sale and the related derivative financial instruments are recorded in mortgage banking activity in the consolidated statements of income and comprehensive income. The Company’s valuation of mortgage loans held for sale incorporates an assumption for credit risk; however, given the short-term period that the Company holds these loans, valuation adjustments attributable to instrument-specific credit risk is nominal.

The following table summarizes the difference between the fair value and the principal balance for mortgage loans held for sale measured at fair value as of September 30, 2023 and December 31, 2022:

(dollars in thousands) 
 September 30, 2023 December 31, 2022
Aggregate fair value of mortgage loans held for sale $ 381,466  $ 390,583 
Aggregate unpaid principal balance of mortgage loans held for sale 381,350  389,610 
Past-due loans of 90 days or more 475  — 
Nonaccrual loans 475  — 
Unpaid principal balance of nonaccrual loans 470  — 

25

The following table summarizes the difference between the fair value and the principal balance for SBA loans held for sale measured at fair value as of September 30, 2023 and December 31, 2022:

(dollars in thousands) 
 September 30, 2023 December 31, 2022
Aggregate fair value of SBA loans held for sale $ —  $ 1,495 
Aggregate unpaid principal balance of SBA loans held for sale —  1,350 
Past-due loans of 90 days or more —  — 
Nonaccrual loans —  — 

The Company utilizes fair value measurements to record fair value adjustments to certain assets and liabilities and to determine fair value disclosures. Securities available-for-sale, loans held for sale under the fair value option and derivative financial instruments are recorded at fair value on a recurring basis. From time to time, the Company may be required to record at fair value other assets on a nonrecurring basis, such as collateral-dependent loans, loan servicing rights and OREO. Additionally, the Company is required to disclose, but not record, the fair value of other financial instruments.

The following table presents the fair value measurements of assets and liabilities measured at fair value on a recurring basis and the level within the fair value hierarchy in which the fair value measurements fall as of September 30, 2023 and December 31, 2022:

Recurring Basis
Fair Value Measurements
  September 30, 2023
(dollars in thousands) 
 Fair Value Level 1 Level 2 Level 3
Financial assets:        
Investment securities available-for-sale:
U.S. Treasuries $ 760,596  $ 760,596  $ —  $ — 
U.S. government sponsored agencies 969  —  969  — 
State, county and municipal securities 27,703  —  27,703  — 
Corporate debt securities 15,036  —  14,061  975 
SBA pool securities 21,751  —  21,751  — 
Mortgage-backed securities 598,026  —  598,026  — 
Loans held for sale 381,466  —  381,466  — 
Derivative financial instruments 13,199  —  13,199  — 
Mortgage banking derivative instruments 8,809  —  8,809  — 
Total recurring assets at fair value $ 1,827,555  $ 760,596  $ 1,065,984  $ 975 
Financial liabilities:        
Derivative financial instruments $ 12,988  $ —  $ 12,988  $ — 
Total recurring liabilities at fair value $ 12,988  $ —  $ 12,988  $ — 

Recurring Basis
Fair Value Measurements
  December 31, 2022
(dollars in thousands) Fair Value Level 1 Level 2 Level 3
Financial assets:        
Investment securities available-for-sale:
U.S. Treasuries $ 759,534  $ 759,534  $ —  $ — 
U.S. government sponsored agencies 979  —  979  — 
State, county and municipal securities 34,195  —  34,195  — 
Corporate debt securities 15,926  —  14,771  1,155 
SBA pool securities 27,398  —  27,398  — 
Mortgage-backed securities 662,028  —  662,028  — 
Loans held for sale 392,078  —  392,078  — 
Derivative financial instruments 4,580  —  4,580  — 
Mortgage banking derivative instruments 3,933  —  3,933  — 
Total recurring assets at fair value $ 1,900,651  $ 759,534  $ 1,139,962  $ 1,155 
Financial liabilities:        
Derivative financial instruments $ 4,574  $ —  $ 4,574  $ — 
Total recurring liabilities at fair value $ 4,574  $ —  $ 4,574  $ — 

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The following table presents the fair value measurements of assets measured at fair value on a non-recurring basis, as well as the general classification of such instruments pursuant to the valuation hierarchy as of September 30, 2023 and December 31, 2022:

  Nonrecurring Basis
Fair Value Measurements
(dollars in thousands) Fair Value Level 1 Level 2 Level 3
September 30, 2023        
Collateral-dependent loans $ 26,656  $ —  $ —  $ 26,656 
Other real estate owned 1,606  —  —  1,606 
Total nonrecurring assets at fair value $ 28,262  $ —  $ —  $ 28,262 
December 31, 2022        
Collateral-dependent loans $ 31,972  $ —  $ —  $ 31,972 
Total nonrecurring assets at fair value $ 31,972  $ —  $ —  $ 31,972 

The inputs used to determine estimated fair value of collateral-dependent loans include market conditions, loan term, underlying collateral characteristics and discount rates.

For the nine months ended September 30, 2023 and the year ended December 31, 2022, there was not a change in the methods and significant assumptions used to estimate fair value.

The following table shows significant unobservable inputs used in the fair value measurement of Level 3 assets:

(dollars in thousands) Fair Value Valuation
Technique		 Unobservable Inputs Range of
Discounts		 Weighted
Average
Discount
September 30, 2023          
Recurring:          
Debt securities available-for-sale $ 975  Discounted cash flows Probability of Default 12.2% 12.2%
Loss Given Default 44% 44%
Nonrecurring:          
Collateral-dependent loans $ 26,656  Third-party appraisals and discounted cash flows Collateral discounts and
discount rates
5% - 50%
 30%
Other real estate owned $ 1,606  Third-party appraisals and sales contracts Collateral discounts and estimated
costs to sell
15% - 46%
 26%
December 31, 2022          
Recurring:          
Debt securities available-for-sale $ 1,155  Discounted cash flows Probability of Default 12.1% 12.1%
Loss Given Default 41% 41%
Nonrecurring:      
Collateral-dependent loans $ 31,972  Third-party appraisals and discounted cash flows Collateral discounts and
discount rates
0% - 48%
 27%

27

The carrying amount and estimated fair value of the Company’s financial instruments, not shown elsewhere in these financial statements, were as follows:

Fair Value Measurements
    September 30, 2023
(dollars in thousands) Carrying
Amount		 Level 1 Level 2 Level 3 Total
Financial assets:          
Cash and due from banks $ 241,137  $ 241,137  $ —  $ —  $ 241,137 
Federal funds sold and interest-bearing accounts 1,304,636  1,304,636  —  —  1,304,636 
Debt securities held-to-maturity 141,859  —  115,689  —  115,689 
Loans, net 19,884,319  —  —  19,247,521  19,247,521 
Accrued interest receivable 83,574  —  9,264  74,311  83,575 
Financial liabilities:          
Deposits 20,590,345  —  20,579,194  —  20,579,194 
Other borrowings 1,209,553  —  1,189,399  —  1,189,399 
Subordinated deferrable interest debentures 129,817  —  141,206  —  141,206 
Accrued interest payable 38,836  —  38,836  —  38,836 

Fair Value Measurements
    December 31, 2022
(dollars in thousands) Carrying
Amount		 Level 1 Level 2 Level 3 Total
Financial assets:          
Cash and due from banks $ 284,567  $ 284,567  $ —  $ —  $ 284,567 
Federal funds sold and interest-bearing accounts 833,565  833,565  —  —  833,565 
Debt securities held-to-maturity 134,864  —  114,538  114,538 
Loans, net 19,617,604  —  —  19,067,612  19,067,612 
Accrued interest receivable 77,042  —  7,694  69,348  77,042 
Financial liabilities:          
Deposits 19,462,738  —  19,455,187  —  19,455,187 
Other borrowings 1,875,736  —  1,861,850  —  1,861,850 
Subordinated deferrable interest debentures 128,322  —  125,988  —  125,988 
Accrued interest payable 10,530  —  10,530  —  10,530 

NOTE 8 – COMMITMENTS AND CONTINGENCIES

Loan Commitments

The Company is a party to financial instruments with off-balance-sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments include commitments to extend credit and standby letters of credit. They involve, to varying degrees, elements of credit risk and interest rate risk in excess of the amount recognized in the Company’s balance sheets.

The Company’s exposure to credit loss is represented by the contractual amount of those instruments. The Company uses the same credit policies in making commitments and conditional obligations as it does for on-balance-sheet instruments. A summary of the Company’s commitments is as follows:

(dollars in thousands) September 30, 2023 December 31, 2022
Commitments to extend credit $ 4,915,246  $ 6,318,039 
Unused home equity lines of credit 388,405  345,001 
Financial standby letters of credit 41,034  33,557 
Mortgage interest rate lock commitments 275,759  148,148 

Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. These commitments, predominantly at variable interest rates, generally have fixed expiration dates or other termination clauses and may require payment of a fee. Since many of the commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. The amount of collateral obtained, if deemed necessary by the Company upon extension of credit, is based on management’s credit evaluation of the customer.
28


Standby letters of credit are conditional commitments issued by the Company to guarantee the performance of a customer to a third party. Those guarantees are primarily issued to support public and private borrowing arrangements. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loans to customers. Collateral is required in instances which the Company deems necessary. The Company has not been required to perform on any material financial standby letters of credit and the Company has not incurred any losses on financial standby letters of credit for the nine months ended September 30, 2023 and the year ended December 31, 2022.

The Company maintains an allowance for credit losses on unfunded commitments which is recorded in other liabilities on the consolidated balance sheets. The following table presents activity in the allowance for unfunded commitments for the periods presented:

Three Months Ended September 30, Nine Months Ended September 30,
(dollars in thousands) 2023 2022 2023 2022
Balance at beginning of period $ 54,630  $ 43,973  $ 52,411  $ 33,185 
Provision for unfunded commitments (5,634) 192  (3,415) 10,980 
Balance at end of period $ 48,996  $ 44,165  $ 48,996  $ 44,165 

Other Commitments

As of September 30, 2023, letters of credit issued by the FHLB totaling $900.0 million were used to guarantee the Bank’s performance related to a portion of its public fund deposit balances.

Litigation and Regulatory Contingencies

From time to time, the Company and the Bank are subject to various legal proceedings, claims and disputes that arise in the ordinary course of business. The Company and the Bank are also subject to regulatory examinations, information gathering requests, inquiries and investigations in the ordinary course of business. Based on the Company’s current knowledge and advice of counsel, management presently does not believe that the liabilities arising from these legal and regulatory matters will have a material adverse effect on the Company’s consolidated financial condition, results of operations or cash flows. However, it is possible that the ultimate resolution of these legal and regulatory matters could have a material adverse effect on the Company’s results of operations and financial condition for any particular period.

The Company’s management and its legal counsel periodically assess contingent liabilities, which may result in a loss to the Company but which will only be resolved when one or more future events occur or fail to occur, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or unasserted claims that may result in such proceedings, the Company evaluates the perceived merits of any legal proceedings or unasserted claims, as well as the perceived merits of the amount of relief sought or expected to be sought therein. If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s financial statements. If the assessment indicates that a potentially material loss contingency is not probable, but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, together with an estimate of the range of possible loss if determinable and material, would be disclosed. Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the nature of the guarantee would be disclosed.

NOTE 9 – SEGMENT REPORTING

The Company has the following five reportable segments: Banking Division, Retail Mortgage Division, Warehouse Lending Division, SBA Division and Premium Finance Division. The Banking Division derives its revenues from the delivery of full-service financial services, including commercial loans, consumer loans and deposit accounts. The Retail Mortgage Division derives its revenues from the origination, sales and servicing of one-to-four family residential mortgage loans. The Warehouse Lending Division derives its revenues from the origination and servicing of warehouse lines to other businesses that are secured by underlying one-to-four family residential mortgage loans. The SBA Division derives its revenues from the origination, sales and servicing of SBA loans. The Premium Finance Division derives its revenues from the origination and servicing of commercial insurance premium finance loans.
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The Banking, Retail Mortgage, Warehouse Lending, SBA and Premium Finance Divisions are managed as separate business units because of the different products and services they provide. The Company evaluates performance and allocates resources based on profit or loss from operations. There are no material intersegment sales or transfers.

The following tables present selected financial information with respect to the Company’s reportable business segments for the three and nine months ended September 30, 2023 and 2022:
  Three Months Ended
September 30, 2023
(dollars in thousands) Banking
Division		 Retail
Mortgage
Division		 Warehouse
Lending
Division		 SBA
Division		 Premium
 Finance
 Division		 Total
Interest income $ 228,448  $ 54,532  $ 19,357  $ 4,766  $ 23,450  $ 330,553 
Interest expense 60,853  31,727  13,349  2,804  14,069  122,802 
Net interest income 167,595  22,805  6,008  1,962  9,381  207,751 
Provision for credit losses 20,833  2,399  (589) 1,677  139  24,459 
Noninterest income 26,245  35,691  662  579  4  63,181 
Noninterest expense            
Salaries and employee benefits 56,226  21,231  924  1,209  2,308  81,898 
Occupancy and equipment 11,437  1,182  1  36  89  12,745 
Data processing and communications expenses 11,786  1,052  30  32  73  12,973 
Other expenses 20,274  12,153  219  157  1,027  33,830 
Total noninterest expense 99,723  35,618  1,174  1,434  3,497  141,446 
Income before income tax expense 73,284  20,479  6,085  (570) 5,749  105,027 
Income tax expense 18,283  4,301  1,278  (120) 1,170  24,912 
Net income $ 55,001  $ 16,178  $ 4,807  $ (450) $ 4,579  $ 80,115 
Total assets $ 18,369,102  $ 4,980,246  $ 859,517  $ 264,953  $ 1,224,012  $ 25,697,830 
Goodwill 951,148  —  —  —  64,498  1,015,646 
Other intangible assets, net 85,648  —  —  —  6,727  92,375 
  Three Months Ended
September 30, 2022
(dollars in thousands) Banking
Division		 Retail
Mortgage
Division		 Warehouse
Lending
Division		 SBA
Division		 Premium
 Finance
 Division		 Total
Interest income $ 164,095  $ 40,389  $ 12,490  $ 3,919  $ 13,409  $ 234,302 
Interest expense (10,412) 21,106  5,511  1,495  3,621  21,321 
Net interest income 174,507  19,283  6,979  2,424  9,788  212,981 
Provision for credit losses 10,551  9,043  (1,836) 52  (158) 17,652 
Noninterest income 23,269  38,584  1,516  1,946  9  65,324 
Noninterest expense            
Salaries and employee benefits 48,599  25,813  1,055  1,412  1,818  78,697 
Occupancy and equipment 11,357  1,460  1  82  83  12,983 
Data processing and communications expenses 10,779  1,082  43  29  82  12,015 
Other expenses 22,974  11,641  209  100  959  35,883 
Total noninterest expense 93,709  39,996  1,308  1,623  2,942  139,578 
Income before income tax expense 93,516  8,828  9,023  2,695  7,013  121,075 
Income tax expense 22,706  1,854  1,895  566  1,499  28,520 
Net income $ 70,810  $ 6,974  $ 7,128  $ 2,129  $ 5,514  $ 92,555 
Total assets $ 16,980,520  $ 4,402,221  $ 955,711  $ 259,427  $ 1,215,778  $ 23,813,657 
Goodwill 958,573  —  —  —  64,498  1,023,071 
Other intangible assets, net 101,225  —  —  —  9,678  110,903 
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  Nine Months Ended
September 30, 2023
(dollars in thousands) Banking
Division		 Retail
Mortgage
Division		 Warehouse
Lending
Division		 SBA
Division		 Premium
 Finance
 Division		 Total
Interest income $ 661,947  $ 155,988  $ 54,931  $ 14,056  $ 61,299  $ 948,221 
Interest expense 147,583  91,739  37,057  7,806  35,093  319,278 
Net interest income 514,364  64,249  17,874  6,250  26,206  628,943 
Provision for credit losses 108,804  8,530  (372) 1,997  745  119,704 
Noninterest income 74,795  106,557  2,546  2,660  22  186,580 
Noninterest expense
Salaries and employee benefits 167,864  63,321  2,498  3,834  6,627  244,144 
Occupancy and equipment 34,218  3,689  2  113  231  38,253 
Data processing and communications expenses 35,481  3,518  120  115  224  39,458 
Other expenses 66,940  35,759  644  912  3,160  107,415 
Total noninterest expense 304,503  106,287  3,264  4,974  10,242  429,270 
Income before income tax expense 175,852  55,989  17,528  1,939  15,241  266,549 
Income tax expense 44,443  11,758  3,681  407  3,089  63,378 
Net income $ 131,409  $ 44,231  $ 13,847  $ 1,532  $ 12,152  $ 203,171 
  Nine Months Ended
September 30, 2022
(dollars in thousands) Banking
Division		 Retail
Mortgage
Division		 Warehouse
Lending
Division		 SBA
Division		 Premium
 Finance
 Division		 Total
Interest income $ 435,229  $ 111,276  $ 27,779  $ 15,456  $ 30,504  $ 620,244 
Interest expense (25,145) 51,919  7,653  3,223  5,705  43,355 
Net interest income 460,374  59,357  20,126  12,233  24,799  576,889 
Provision for credit losses 25,952  15,129  (1,191) (614) (469) 38,807 
Noninterest income 68,102  158,028  3,958  5,963  25  236,076 
Noninterest expense
Salaries and employee benefits 144,527  88,646  1,546  3,999  5,805  244,523 
Occupancy and equipment 33,599  4,337  3  262  255  38,456 
Data processing and communications expenses 32,872  3,377  138  86  269  36,742 
Other expenses 64,142  37,098  639  1,019  2,975  105,873 
Total noninterest expense 275,140  133,458  2,326  5,366  9,304  425,594 
Income before income tax expense 227,384  68,798  22,949  13,444  15,989  348,564 
Income tax expense 58,822  14,448  4,820  2,823  3,332  84,245 
Net income $ 168,562  $ 54,350  $ 18,129  $ 10,621  $ 12,657  $ 264,319 


NOTE 10 – LOAN SERVICING RIGHTS

The Company sells certain residential mortgage loans and SBA loans to third parties. All such transfers are accounted for as sales and the continuing involvement in the loans sold is limited to certain servicing responsibilities. The Company has also acquired servicing portfolios of residential mortgage and SBA loans. Loan servicing rights are initially recorded at fair value and subsequently recorded at the lower of cost or fair value and are amortized over the remaining service life of the loans, with consideration given to prepayment assumptions. Loan servicing rights are recorded in other assets on the consolidated balance sheets.

The carrying value of the loan servicing rights assets is shown in the table below:

(dollars in thousands) September 30, 2023 December 31, 2022
Loan Servicing Rights
Residential mortgage $ 168,379  $ 147,014 
SBA 2,822  3,443 
Total loan servicing rights $ 171,201  $ 150,457 

31

Residential Mortgage Loans

The Company sells certain first-lien residential mortgage loans to third party investors, primarily the Federal National Mortgage Association (“FNMA”), the Government National Mortgage Association (“GNMA”) and the Federal Home Loan Mortgage Corporation (“FHLMC”). The Company retains the related mortgage servicing rights (“MSRs”) and receives servicing fees on certain of these loans. The net gain on loan sales, MSRs amortization and recoveries/impairment, and ongoing servicing fees on the portfolio of loans serviced for others are recorded in the consolidated statements of income and comprehensive income as part of mortgage banking activity.

During the three- and nine-month periods ended September 30, 2023, the Company recorded servicing fee income of $15.8 million and $45.0 million, respectively. During the three- and nine-month periods ended September 30, 2022, the Company recorded servicing fee income of $18.4 million and $54.6 million, respectively. Servicing fee income includes servicing fees, late fees and ancillary fees earned for each period.

The table below is an analysis of the activity in the Company’s MSRs and valuation allowance:

(dollars in thousands) Three Months Ended September 30, Nine Months Ended September 30,
Residential mortgage servicing rights 2023 2022 2023 2022
Beginning carrying value, net $ 160,021  $ 257,112  $ 147,014  $ 206,944 
Additions 13,265  14,893  35,726  58,145 
Amortization (4,907) (6,939) (14,361) (20,515)
Recoveries —  1,332  —  21,824 
Disposals —  (121,634) —  (121,634)
Ending carrying value, net $ 168,379  $ 144,764  $ 168,379  $ 144,764 

(dollars in thousands) Three Months Ended September 30, Nine Months Ended September 30,
Residential mortgage servicing valuation allowance 2023 2022 2023 2022
Beginning balance $ —  $ 5,290  $ —  $ 25,782 
Recoveries —  (1,332) —  (21,824)
Reduction due to disposal —  (3,958) —  (3,958)
Ending balance $ —  $ —  $ —  $ — 

The key metrics and the sensitivity of the fair value to adverse changes in model inputs and/or assumptions are summarized below:

(dollars in thousands) September 30, 2023 December 31, 2022
Residential mortgage servicing rights
Unpaid principal balance of loans serviced for others $ 12,013,844  $ 10,046,052 
Composition of residential loans serviced for others:
FHLMC 17.41  % 16.80  %
FNMA 50.44  % 50.09  %
GNMA 32.15  % 33.11  %
Total 100.00  % 100.00  %
Weighted average term (months) 354 353
Weighted average age (months) 26 22
Modeled prepayment speed 7.79  % 8.22  %
Decline in fair value due to a 10% adverse change (2,900) (5,800)
Decline in fair value due to a 20% adverse change (6,483) (11,184)
Weighted average discount rate 11.66  % 10.00  %
Decline in fair value due to a 10% adverse change (3,843) (6,413)
Decline in fair value due to a 20% adverse change (8,989) (12,330)

32


The sensitivity calculations above are hypothetical and should not be considered to be predictive of future performance. As indicated, changes in fair value based on adverse changes in model inputs and/or assumptions generally cannot be extrapolated because the relationship of a change in input or assumption to the change in fair value may not be linear. In addition, the effect of an adverse variation in a particular input or assumption on the value of the residential mortgage servicing rights is calculated without changing any other input or assumption. In reality, a change in another factor may magnify or counteract the effect of the change in the first.

SBA Loans

All sales of SBA loans, consisting of the guaranteed portion, are executed on a servicing retained basis. These loans, which are partially guaranteed by the SBA, are generally secured by business property such as real estate, inventory, equipment and accounts receivable. The net gain on SBA loan sales, amortization and impairment/recoveries of servicing rights, and ongoing servicing fees are recorded in the consolidated statements of income and comprehensive income as part of other noninterest income.

During the three- and nine-month periods ended September 30, 2023, the Company recorded servicing fee income of $734,000 and $2.2 million, respectively. During the three- and nine-month periods ended September 30, 2022, the Company recorded servicing fee income of $907,000 and $2.8 million, respectively. Servicing fee income includes servicing fees, late fees and ancillary fees earned for each period.

The table below is an analysis of the activity in the Company’s SBA loan servicing rights and valuation allowance:

(dollars in thousands) Three Months Ended September 30, Nine Months Ended September 30,
SBA servicing rights 2023 2022 2023 2022
Beginning carrying value, net $ 3,097  $ 4,954  $ 3,443  $ 5,556 
Additions 33  99  348  873 
Amortization (308) (735) (969) (2,111)
Ending carrying value, net $ 2,822  $ 4,318  $ 2,822  $ 4,318 


(dollars in thousands) September 30, 2023 December 31, 2022
SBA servicing rights
Unpaid principal balance of loans serviced for others $ 299,910  $ 326,418 
Weighted average life (in years) 3.49 3.69
Modeled prepayment speed 19.68  % 18.24  %
Decline in fair value due to a 10% adverse change (265) (177)
Decline in fair value due to a 20% adverse change (415) (340)
Weighted average discount rate 16.97  % 19.57  %
Decline in fair value due to a 100 basis point adverse change (170) (83)
Decline in fair value due to a 200 basis point adverse change (236) (163)

The sensitivity calculations above are hypothetical and should not be considered to be predictive of future performance. As indicated, changes in fair value based on adverse changes in model inputs and/or assumptions generally cannot be extrapolated because the relationship of a change in input or assumption to the change in fair value may not be linear. In addition, the effect of an adverse variation in a particular input or assumption on the value of the SBA servicing rights is calculated without changing any other input or assumption. In reality, a change in another factor may magnify or counteract the effect of the change in the first.

NOTE 11 – GOODWILL

The Company has goodwill at its Banking Division and Premium Finance Division (collectively "the divisions"). The carrying value of goodwill at the Banking Division was $951.1 million at both September 30, 2023 and December 31, 2022. The carrying value of goodwill at the Premium Finance Division was $64.5 million at both September 30, 2023 and December 31, 2022. The Company performs its annual impairment test at December 31 of each year and more frequently if a triggering event occurs.
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At December 31, 2022, the Company performed a qualitative assessment of goodwill at the divisions and determined it was more likely than not that, in each case, the reporting unit's fair value exceeded its carrying value. The Company performed an interim qualitative assessment at March 31, 2023 considering the decline in the Company's stock price relative to book value and the impact of recent bank failures on the economy and again determined that it was more likely than not that each reporting unit's fair value exceeded its carrying value.

During the second quarter of 2023, the Company assessed the indicators of goodwill impairment and determined a triggering event had occurred due to the sustained decline in the Company's stock price. The Company performed a quantitative analysis of goodwill at the divisions as of June 30, 2023. The Premium Finance Division was measured utilizing a discounted cash flow approach. The Banking Division was measured using multiple approaches. The primary approach for the Banking Division was the discounted cash flow approach, and the Company also used a market approach comparing to similar public companies' multiples and control premiums from transactions during prior distressed periods. The results from each of the primary approaches showed valuation of the reporting unit in excess of carrying value at June 30, 2023. The discounted cash flow approach for the Premium Finance Division resulted in a fair value approximately 8% higher than its carrying value. The discounted cash flow approach for the Banking Division indicated a fair value approximately 20% higher than its carrying value, and the market approach indicated a fair value approximately 9% higher than its carrying value. As a result, management determined no impairment existed at June 30, 2023. At September 30, 2023, the Company assessed the indicators of goodwill impairment and determined a triggering event had not occurred and no impairment test was performed. The Company will perform its annual impairment test at December 31, 2023.

Each of the valuation methods used by the Company requires significant assumptions. Depending on the specific method, assumptions are made regarding growth rates, discount rates for cash flows, control premiums, and selected multiples. Changes to any of the assumptions could result in significantly different results.

NOTE 12 – SUBSEQUENT EVENTS

On October 19, 2023, the Bank announced that it had entered into a settlement with the United States Department of Justice that resolves alleged violations of fair lending laws in the Jacksonville, Florida metropolitan area from 2016 to 2021. The terms of the settlement are reflected in the consent order filed in the United States District Court for the Middle District of Florida (the “Consent Order”). In accordance with the terms of the Consent Order, the Bank will provide $7.5 million in mortgage loan subsidies over a five-year period in Majority Black and Hispanic Census Tracts (“MBHCTs”) in Jacksonville and will also commit, for the same five-year period in the Jacksonville MBHCT communities, $900,000 for focused advertising and outreach and $600,000 for community development partnerships providing services related to credit, financial education, homeownership, and foreclosure prevention. In addition, the Bank will open a new full-service branch in a Jacksonville MBHCT community as specified in the Consent Order. The settlement includes no civil penalties levied against the Bank.



34

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Cautionary Note Regarding Forward-Looking Statements

Certain of the statements made in this report are “forward-looking statements” within the meaning of, and subject to the protections of, Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Forward-looking statements include statements with respect to our beliefs, plans, objectives, goals, expectations, anticipations, assumptions, estimates, intentions and future performance and involve known and unknown risks, uncertainties and other factors, many of which may be beyond our control and which may cause the actual results, performance or achievements of the Company to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements.

All statements other than statements of historical fact are statements that could be forward-looking statements. You can identify these forward-looking statements through our use of words such as “may,” “will,” “anticipate,” “assume,” “should,” “indicate,” “would,” “believe,” “contemplate,” “expect,” “estimate,” “continue,” “plan,” “point to,” “project,” “predict,” “could,” “intend,” “target,” “potential” and 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 following: general competitive, economic, unemployment, political and market conditions and fluctuations, including real estate market conditions, and the effects of such conditions and fluctuations on the creditworthiness of borrowers, collateral values, asset recovery values and the value of investment securities; movements in interest rates and their impacts on net interest margin; expectations on credit quality and performance; competitive pressures on product pricing and services; legislative and regulatory changes; changes in U.S. government monetary and fiscal policy; investment security valuation and other performance measures; the potential impact of the phase-out of the London Interbank Offered Rate ("LIBOR") or other changes involving LIBOR; additional competition in our markets; changes in state and federal banking laws and regulations to which we are subject; financial market conditions and the results of financing efforts; the cost savings and any revenue synergies expected to result from acquisition transactions, which may not be fully realized within the expected timeframes if at all; the success and timing of other business strategies; our outlook and long-term goals for future growth; weather events, natural disasters, geopolitical events, acts of war or terrorism or other hostilities, public health crises and other catastrophic events beyond our control; and other factors discussed in our filings with the Securities and Exchange Commission (the “SEC”) under the Exchange Act.

All written or oral forward-looking statements that are made by or are attributable to us are expressly qualified in their entirety by this cautionary notice. Our forward-looking statements apply only as of the date of this report or the respective date of the document from which they are incorporated herein by reference. We have no obligation and do not undertake to update, revise or correct any of the forward-looking statements after the date of this report, or after the respective dates on which such statements otherwise are made, whether as a result of new information, future events or otherwise.

Overview

The following is management’s discussion and analysis of certain significant factors which have affected the financial condition and results of operations of the Company as reflected in the unaudited consolidated balance sheet as of September 30, 2023, as compared with December 31, 2022, and operating results for the three- and nine-month periods ended September 30, 2023 and 2022. These comments should be read in conjunction with the Company’s unaudited consolidated financial statements and accompanying notes appearing elsewhere herein.

This discussion contains certain performance measures determined by methods other than in accordance with GAAP. Management of the Company uses these non-GAAP measures in its analysis of the Company’s performance. These measures are useful when evaluating the underlying performance and efficiency of the Company’s operations and balance sheet. The Company’s management believes that these non-GAAP measures provide a greater understanding of ongoing operations, enhance comparability of results with prior periods and demonstrate the effects of significant gains and charges in the current period. The Company’s management believes that investors may use these non-GAAP financial measures to evaluate the Company’s financial performance without the impact of unusual items that may obscure trends in the Company’s underlying performance. These disclosures should not be viewed as a substitute for financial measures determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. Non-GAAP measures include adjusted net income and adjusted net income per diluted share. The Company calculates the regulatory capital ratios using current regulatory report instructions. The Company’s management uses these measures to assess the quality of capital and believes that investors may find them useful in their evaluation of the Company. These capital measures may or may not be necessarily comparable to similar capital measures that may be presented by other companies.
35

Critical Accounting Policies

There have been no significant changes to our critical accounting policies from those disclosed in our 2022 Annual Report on Form 10-K, except as described below. The reader should refer to the notes to our consolidated financial statements in our 2022 Annual Report on Form 10-K for a full disclosure of all critical accounting policies.

Goodwill

Goodwill represents the excess of cost over the fair value of the net assets purchased in business combinations. Goodwill is required to be tested annually for impairment or whenever events occur that may indicate that the recoverability of the carrying amount is not probable. In the event of an impairment, the amount by which the carrying amount exceeds the fair value is charged to earnings. The Company performs its annual impairment testing of goodwill in the fourth quarter of each year.

Results of Operations for the Three Months Ended September 30, 2023 and 2022

Consolidated Earnings and Profitability

Ameris reported net income available to common shareholders of $80.1 million, or $1.16 per diluted share, for the quarter ended September 30, 2023, compared with $92.6 million, or $1.34 per diluted share, for the same period in 2022. The Company’s return on average assets and average shareholders’ equity were 1.25% and 9.56%, respectively, in the third quarter of 2023, compared with 1.56% and 11.76%, respectively, in the third quarter of 2022. During the third quarter of 2022, the Company recorded pre-tax servicing right impairment recovery of $1.3 million, pre-tax gain on bank owned life insurance (BOLI) proceeds of $55,000, pre-tax loss on sale of mortgage servicing rights of $316,000 and pre-tax natural disaster expenses of $151,000. Excluding these adjustment items, the Company’s net income would have been $91.8 million, or $1.32 per diluted share, for the third quarter of 2022.

Below is a reconciliation of adjusted net income to net income, as discussed above.
  Three Months Ended September 30,
(in thousands, except share and per share data) 2023 2022
Net income $ 80,115  $ 92,555 
Adjustment items:    
Loss on sale of mortgage servicing rights —  316 
Servicing right impairment (recovery) —  (1,332)
Gain on BOLI proceeds —  (55)
Natural disaster expenses —  151 
Tax effect of adjustment items (Note 1)
 —  182 
After tax adjustment items —  (738)
Adjusted net income $ 80,115  $ 91,817 
Weighted average common shares outstanding - diluted 68,994,247  69,327,414 
Net income per diluted share $ 1.16  $ 1.34 
Adjusted net income per diluted share $ 1.16  $ 1.32 
Note 1: Tax effect is calculated utilizing a 21% rate for taxable adjustments. Gain on BOLI proceeds is non-taxable and no tax effect is included.

36

Below is additional information regarding the retail banking activities, mortgage banking activities, warehouse lending activities, SBA activities and premium finance activities of the Company during the third quarter of 2023 and 2022, respectively:

  Three Months Ended
September 30, 2023
(dollars in thousands) Banking
Division		 Retail
Mortgage
Division		 Warehouse
Lending
Division		 SBA
Division		 Premium
 Finance
 Division		 Total
Interest income $ 228,448  $ 54,532  $ 19,357  $ 4,766  $ 23,450  $ 330,553 
Interest expense 60,853  31,727  13,349  2,804  14,069  122,802 
Net interest income 167,595  22,805  6,008  1,962  9,381  207,751 
Provision for credit losses 20,833  2,399  (589) 1,677  139  24,459 
Noninterest income 26,245  35,691  662  579  4  63,181 
Noninterest expense            
Salaries and employee benefits 56,226  21,231  924  1,209  2,308  81,898 
Occupancy and equipment 11,437  1,182  1  36  89  12,745 
Data processing and communications expenses 11,786  1,052  30  32  73  12,973 
Other expenses 20,274  12,153  219  157  1,027  33,830 
Total noninterest expense 99,723  35,618  1,174  1,434  3,497  141,446 
Income before income tax expense 73,284  20,479  6,085  (570) 5,749  105,027 
Income tax expense 18,283  4,301  1,278  (120) 1,170  24,912 
Net income $ 55,001  $ 16,178  $ 4,807  $ (450) $ 4,579  $ 80,115 

  Three Months Ended
September 30, 2022
(dollars in thousands) Banking
Division		 Retail
Mortgage
Division		 Warehouse
Lending
Division		 SBA
Division		 Premium
Finance
Division		 Total
Interest income $ 164,095  $ 40,389  $ 12,490  $ 3,919  $ 13,409  $ 234,302 
Interest expense (10,412) 21,106  5,511  1,495  3,621  21,321 
Net interest income 174,507  19,283  6,979  2,424  9,788  212,981 
Provision for credit losses 10,551  9,043  (1,836) 52  (158) 17,652 
Noninterest income 23,269  38,584  1,516  1,946  9  65,324 
Noninterest expense            
Salaries and employee benefits 48,599  25,813  1,055  1,412  1,818  78,697 
Occupancy and equipment 11,357  1,460  1  82  83  12,983 
Data processing and communications expenses 10,779  1,082  43  29  82  12,015 
Other expenses 22,974  11,641  209  100  959  35,883 
Total noninterest expense 93,709  39,996  1,308  1,623  2,942  139,578 
Income before income tax expense 93,516  8,828  9,023  2,695  7,013  121,075 
Income tax expense 22,706  1,854  1,895  566  1,499  28,520 
Net income $ 70,810  $ 6,974  $ 7,128  $ 2,129  $ 5,514  $ 92,555 
 
37

Net Interest Income and Margins

The following table sets forth the average balance, interest income or interest expense, and average interest rate for each category of interest-earning assets and interest-bearing liabilities, net interest spread, and net interest margin on average interest-earning assets for the three months ended September 30, 2023 and 2022. Federally tax-exempt income is presented on a taxable-equivalent basis assuming a 21% federal tax rate.

  Quarter Ended September 30,
  2023 2022
(dollars in thousands) Average
Balance		 Interest
Income/
Expense		 Average
Yield/
Rate Paid		 Average
Balance		 Interest
Income/
Expense		 Average
Yield/
Rate Paid
Assets
Interest-earning assets:
Federal funds sold, interest-bearing deposits in banks, and time deposits in other banks $ 864,028  $ 10,769  4.94% $ 1,399,529  $ 7,215  2.05%
Investment securities 1,691,060  15,172  3.56% 1,339,750  10,783  3.19%
Loans held for sale 464,452  7,460  6.37% 471,070  6,012  5.06%
Loans 20,371,689  298,102  5.81% 18,146,083  211,223  4.62%
Total interest-earning assets 23,391,229  331,503  5.62% 21,356,432  235,233  4.37%
Noninterest-earning assets 2,134,684  2,242,033 
Total assets $ 25,525,913  $ 23,598,465 
Liabilities and Shareholders’ Equity
Interest-bearing liabilities:
Savings and interest-bearing demand deposits $ 10,105,110  $ 64,729  2.54% $ 9,758,158  $ 12,706  0.52%
Time deposits 3,642,267  38,270  4.17% 1,506,761  1,328  0.35%
Securities sold under agreements to repurchase —  —  —% 92  —  —%
FHLB advances 943,855  12,543  5.27% 94,357  527  2.22%
Other borrowings 312,572  3,821  4.85% 376,942  4,655  4.90%
Subordinated deferrable interest debentures 129,554  3,439  10.53% 127,560  2,105  6.55%
Total interest-bearing liabilities 15,133,358  122,802  3.22% 11,863,870  21,321  0.71%
Demand deposits 6,655,191  8,259,625 
Other liabilities 412,404  351,252 
Shareholders’ equity 3,324,960  3,123,718 
Total liabilities and shareholders’ equity $ 25,525,913  $ 23,598,465 
Interest rate spread   2.40% 3.66%
Net interest income   $ 208,701  $ 213,912 
Net interest margin     3.54%   3.97%

On a tax-equivalent basis, net interest income for the third quarter of 2023 was $208.7 million, a decrease of $5.2 million, or 2.4%, compared with $213.9 million reported in the same quarter in 2022. The decrease in net interest income is primarily a result of increased cost of funds as market interest rates have risen, partially offset by growth in average earning assets and related rates. Average interest earning assets increased $2.03 billion, or 9.5%, from $21.36 billion in the third quarter of 2022 to $23.39 billion for the third quarter of 2023. This growth in interest-earning assets resulted primarily from organic loan growth and securities purchases, partially offset by a decline in excess liquidity. The Company’s net interest margin during the third quarter of 2023 was 3.54%, down 43 basis points from 3.97% reported in the third quarter of 2022. Loan production in the lines of business (including retail mortgage, warehouse lending, SBA and premium finance) amounted to $4.2 billion during the third quarter of 2023, with weighted average yields of 7.28%, compared with $4.6 billion and 5.29%, respectively, during the third quarter of 2022. Loan production in the banking division amounted to $621.0 million during the third quarter of 2023, with weighted average yields of 9.49%, compared with $1.1 billion and 6.26%, respectively, during the third quarter of 2022.

Total interest income, on a tax-equivalent basis, increased to $331.5 million during the third quarter of 2023, compared with $235.2 million in the same quarter of 2022.  Yields on earning assets increased to 5.62% during the third quarter of 2023, compared with 4.37% reported in the third quarter of 2022. During the third quarter of 2023, loans comprised 89.1% of average earning assets, compared with 87.2% in the same quarter of 2022. Yields on loans increased to 5.81% in the third quarter of 2023, compared with 4.62% in the same period of 2022.

38

The yield on total interest-bearing liabilities increased from 0.71% in the third quarter of 2022 to 3.22% in the third quarter of 2023. Total funding costs, inclusive of noninterest-bearing demand deposits, increased to 2.24% in the third quarter of 2023, compared with 0.42% during the third quarter of 2022. Deposit costs increased from 0.29% in the third quarter of 2022 to 2.00% in the third quarter of 2023. Non-deposit funding costs increased from 4.83% in the third quarter of 2022 to 5.67% in the third quarter of 2023. Average balances of interest-bearing deposits and their respective costs for the third quarter of 2023 and 2022 are shown below:

  Three Months Ended
September 30, 2023		 Three Months Ended
September 30, 2022
(dollars in thousands) Average
Balance		 Average
Cost		 Average
Balance		 Average
Cost
NOW $ 3,661,701  1.87% $ 3,701,045  0.40%
MMDA 5,527,731  3.28% 5,026,815  0.68%
Savings 915,678  0.78% 1,030,298  0.14%
Retail CDs 2,200,413  3.43% 1,506,761  0.35%
Brokered CDs 1,441,854  5.30% —  —%
Interest-bearing deposits $ 13,747,377  2.97% $ 11,264,919  0.49%

Provision for Credit Losses

The Company’s provision for credit losses during the third quarter of 2023 amounted to $24.5 million, compared with $17.7 million in the third quarter of 2022. This increase was attributable to the updated economic forecast. The provision for credit losses for the third quarter of 2023 was comprised of $30.1 million related to loans, negative $5.6 million related to unfunded commitments and negative $2,000 related to other credit losses, compared with $17.5 million related to loans, $192,000 related to unfunded commitments and negative $9,000 related to other credit losses for the third quarter of 2022. Non-performing assets as a percentage of total assets decreased three basis points to 0.58% at September 30, 2023, compared with 0.61% at December 31, 2022. The decrease in non-performing assets is primarily attributable to a decrease in accruing loans delinquent 90 days or more of $6.0 million, partially offset by an increase in other real estate owned of $2.6 million. The Company recognized net charge-offs on loans during the third quarter of 2023 of approximately $12.1 million, or 0.23% of average loans on an annualized basis, compared with net charge-offs of approximately $5.2 million, or 0.11%, in the third quarter of 2022. Approximately $3.2 million of net charge-offs for the third quarter of 2023 related to acquired loans which were fully reserved at the acquisition date. The Company’s total allowance for credit losses on loans at September 30, 2023 was $290.1 million, or 1.44% of total loans, compared with $205.7 million, or 1.04% of total loans, at December 31, 2022. This increase is primarily attributable to updated forecast economic conditions.

Noninterest Income

Total noninterest income for the third quarter of 2023 was $63.2 million, a decrease of $2.1 million, or 3.3%, from the $65.3 million reported in the third quarter of 2022.  Income from mortgage banking activities was $36.3 million in the third quarter of 2023, a decrease of $4.1 million, or 10.1%, from $40.4 million in the third quarter of 2022. Total production in the third quarter of 2023 amounted to $1.18 billion, compared with $1.26 billion in the same quarter of 2022, while spread (gain on sale) increased to 2.15% in the current quarter, compared with 2.10% in the same quarter of 2022. Mortgage banking activities for the third quarter of 2022 were positively impacted by a recovery of prior mortgage servicing right impairment of $1.3 million, compared with no such recovery in the third quarter of 2023 The retail mortgage open pipeline finished the third quarter of 2023 at $623.9 million, compared with $652.1 million at June 30, 2023 and $520.0 million at the end of the third quarter of 2022.

Service charges on deposit accounts increased $924,000, or 8.3%, to $12.1 million in the third quarter of 2023, compared with $11.2 million in the third quarter of 2022. Other noninterest income increased $737,000, or 5.7%, to $13.6 million for the third quarter of 2023, compared with $12.9 million during the third quarter of 2022. The increase in other noninterest income was primarily attributable to increased equipment finance fee income, BOLI income and SBA servicing income of $2.2 million, $568,000 and $253,000, respectively, partially offset by declines in gain on sale of SBA loans and trust income of $1.6 million and $1.1 million, respectively.

Noninterest Expense

Total noninterest expense for the third quarter of 2023 increased $1.9 million, or 1.3%, to $141.4 million, compared with $139.6 million in the same quarter 2022. Salaries and employee benefits increased $3.2 million, or 4.1%, from $78.7 million in the third quarter of 2022 to $81.9 million in the third quarter of 2023, due primarily to decreases in deferred origination costs of $8.0 million, partially offset by declines in variable commissions tied to mortgage production of $2.5 million, and incentive compensation of $2.8 million.
39

Occupancy and equipment expenses decreased $238,000, or 1.8%, to $12.7 million for the third quarter of 2023, compared with $13.0 million in the third quarter of 2022. Data processing and communications expenses increased $1.0 million, or 8.0%, to $13.0 million in the third quarter of 2023, compared with $12.0 million in the third quarter of 2022. Advertising and marketing expense was $2.7 million in the third quarter of 2023, compared with $3.6 million in the third quarter of 2022. This decrease was primarily related to a marketing campaign begun in the second quarter of 2022 which was narrowed in 2023. Amortization of intangible assets decreased $285,000, or 6.1%, from $4.7 million in the third quarter of 2022 to $4.4 million in the third quarter of 2023. This decrease was primarily related to a reduction in core deposit intangible amortization. Loan servicing expenses decreased $323,000, or 3.4%, from $9.6 million in the third quarter of 2022 to $9.3 million in the third quarter of 2023, primarily attributable to the sale of a portion of our mortgage servicing portfolio during the third quarter of 2022, partially offset by additional mortgage loans serviced added from mortgage production over the previous year. Other noninterest expenses increased $871,000, or 4.9%, from $17.9 million in the third quarter of 2022 to $18.8 million in the third quarter of 2023, due primarily to a decrease of $846,000 in deferred third-party origination costs in our equipment finance division.

Income Taxes

Income tax expense is influenced by the statutory rate, the amount of taxable income, the amount of tax-exempt income and the amount of nondeductible expenses.  For the third quarter of 2023, the Company reported income tax expense of $24.9 million, compared with $28.5 million in the same period of 2022. The Company’s effective tax rate for the three months ended September 30, 2023 and 2022 was 23.7% and 23.6%, respectively.

40

Results of Operations for the Nine Months Ended September 30, 2023 and 2022

Consolidated Earnings and Profitability

Ameris reported net income available to common shareholders of $203.2 million, or $2.94 per diluted share, for the nine months ended September 30, 2023, compared with $264.3 million, or $3.81 per diluted share, for the same period in 2022. The Company’s return on average assets and average shareholders’ equity were 1.07% and 8.26%, respectively, in the nine months ended September 30, 2023, compared with 1.51% and 11.57%, respectively, in the same period in 2022. During the first nine months of 2023, the Company recorded pre-tax gain on BOLI proceeds of $486,000. During the first nine months of 2022, the Company recorded pre-tax merger and conversion charges of $977,000, pre-tax loss on sale of mortgage servicing rights of $316,000, pre-tax servicing right recovery of $21.8 million, pre-tax gain on BOLI proceeds of $55,000, pre-tax natural disaster expenses of $151,000 and pre-tax gain on bank premises of $45,000. Excluding these adjustment items, the Company’s net income would have been $202.7 million, or $2.93 per diluted share, for the nine months ended September 30, 2023 and $248.3 million, or $3.58 per diluted share, for the same period in 2022.

Below is a reconciliation of adjusted net income to net income, as discussed above.
  Nine Months Ended
September 30,
(in thousands, except share and per share data) 2023 2022
Net income available to common shareholders $ 203,171  $ 264,319 
Adjustment items:    
Merger and conversion charges —  977 
Loss on sale of mortgage servicing rights —  316 
Servicing right recovery —  (21,824)
Gain on BOLI proceeds (486) (55)
Natural disaster expenses —  151 
Gain on bank premises —  (45)
Tax effect of adjustment items (Note 1)
 —  4,490 
After tax adjustment items (486) (15,990)
Adjusted net income $ 202,685  $ 248,329 
Weighted average common shares outstanding - diluted 69,129,921  69,427,522 
Net income per diluted share $ 2.94  $ 3.81 
Adjusted net income per diluted share $ 2.93  $ 3.58 
Note 1: Tax effect is calculated utilizing a 21% rate for taxable adjustments. Gain on BOLI proceeds is non-taxable and no tax effect is included. A portion of the merger and conversion charges for the nine months ended September 30, 2022 is nondeductible for tax purposes.

41

Below is additional information regarding the retail banking activities, mortgage banking activities, warehouse lending activities, SBA activities and premium finance activities of the Company during the nine months ended September 30, 2023 and 2022, respectively:

  Nine Months Ended
September 30, 2023
(dollars in thousands) Banking
Division		 Retail
Mortgage
Division		 Warehouse
Lending
Division		 SBA
Division		 Premium
 Finance
 Division		 Total
Interest income $ 661,947  $ 155,988  $ 54,931  $ 14,056  $ 61,299  $ 948,221 
Interest expense 147,583  91,739  37,057  7,806  35,093  319,278 
Net interest income 514,364  64,249  17,874  6,250  26,206  628,943 
Provision for loan losses 108,804  8,530  (372) 1,997  745  119,704 
Noninterest income 74,795  106,557  2,546  2,660  22  186,580 
Noninterest expense
Salaries and employee benefits 167,864  63,321  2,498  3,834  6,627  244,144 
Occupancy and equipment 34,218  3,689  2  113  231  38,253 
Data processing and communications expenses 35,481  3,518  120  115  224  39,458 
Other expenses 66,940  35,759  644  912  3,160  107,415 
Total noninterest expense 304,503  106,287  3,264  4,974  10,242  429,270 
Income before income tax expense 175,852  55,989  17,528  1,939  15,241  266,549 
Income tax expense 44,443  11,758  3,681  407  3,089  63,378 
Net income $ 131,409  $ 44,231  $ 13,847  $ 1,532  $ 12,152  $ 203,171 

  Nine Months Ended
September 30, 2022
(dollars in thousands) Banking
Division		 Retail
Mortgage
Division		 Warehouse
Lending
Division		 SBA
Division		 Premium
Finance
Division		 Total
Interest income $ 435,229  $ 111,276  $ 27,779  $ 15,456  $ 30,504  $ 620,244 
Interest expense (25,145) 51,919  7,653  3,223  5,705  43,355 
Net interest income 460,374  59,357  20,126  12,233  24,799  576,889 
Provision for loan losses 25,952  15,129  (1,191) (614) (469) 38,807 
Noninterest income 68,102  158,028  3,958  5,963  25  236,076 
Noninterest expense
Salaries and employee benefits 144,527  88,646  1,546  3,999  5,805  244,523 
Occupancy and equipment 33,599  4,337  3  262  255  38,456 
Data processing and communications expenses 32,872  3,377  138  86  269  36,742 
Other expenses 64,142  37,098  639  1,019  2,975  105,873 
Total noninterest expense 275,140  133,458  2,326  5,366  9,304  425,594 
Income before income tax expense 227,384  68,798  22,949  13,444  15,989  348,564 
Income tax expense 58,822  14,448  4,820  2,823  3,332  84,245 
Net income $ 168,562  $ 54,350  $ 18,129  $ 10,621  $ 12,657  $ 264,319 

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Net Interest Income and Margins

The following table sets forth the average balance, interest income or interest expense, and average yield/rate paid for each category of interest-earning assets and interest-bearing liabilities, net interest spread, and net interest margin on average interest-earning assets for the nine months ended September 30, 2023 and 2022. Federally tax-exempt income is presented on a taxable-equivalent basis assuming a 21% federal tax rate.

  Nine Months Ended
September 30,
  2023 2022
(dollars in thousands) Average
Balance		 Interest
Income/
Expense		 Average
Yield/
Rate Paid		 Average
Balance		 Interest
Income/
Expense		 Average
Yield/
Rate Paid
Assets            
Interest-earning assets:            
Federal funds sold, interest-bearing deposits  in banks, and time deposits in other banks $ 907,433  $ 33,568  4.95% $ 2,339,364  $ 13,093  0.75%
Investment securities 1,730,824  46,246  3.57% 1,023,118  22,662  2.96%
Loans held for sale 510,690  22,865  5.99% 835,418  24,180  3.87%
Loans 20,121,143  848,375  5.64% 16,951,566  563,223  4.44%
Total interest-earning assets 23,270,090  951,054  5.46% 21,149,466  623,158  3.94%
Noninterest-earning assets 2,155,974      2,255,945     
Total assets $ 25,426,064      $ 23,405,411     
Liabilities and Shareholders’ Equity            
Interest-bearing liabilities:            
Savings and interest-bearing demand deposits $ 10,070,954  $ 164,382  2.18% $ 9,815,352  $ 18,896  0.26%
Time deposits 2,939,293  79,886  3.63% 1,657,193  4,138  0.33%
Federal funds purchased and securities sold under agreements to repurchase —  —  —% 1,974  4  0.27%
FHLB advances 1,436,753  52,213  4.86% 64,130  909  1.90%
Other borrowings 330,035  13,072  5.30% 398,898  14,256  4.78%
Subordinated deferrable interest debentures 129,059  9,725  10.07% 127,066  5,152  5.42%
Total interest-bearing liabilities 14,906,094  319,278  2.86% 12,064,613  43,355  0.48%
Demand deposits 6,838,618      7,960,149     
Other liabilities 391,646      326,293     
Shareholders’ equity 3,289,706      3,054,356     
Total liabilities and shareholders’ equity $ 25,426,064      $ 23,405,411     
Interest rate spread     2.60%     3.46%
Net interest income   $ 631,776      $ 579,803   
Net interest margin     3.63%     3.67%

On a tax-equivalent basis, net interest income for the nine months ended September 30, 2023 was $631.8 million, an increase of $52.0 million, or 9.0%, compared with $579.8 million reported in the same period of 2022. The higher net interest income is a result of growth in average earning assets and increased market rates, partially offset by increased funding costs. Average interest earning assets increased $2.12 billion, or 10.0%, from $21.15 billion in the first nine months of 2022 to $23.27 billion for the first nine months of 2023. This growth in interest earning assets resulted primarily from organic growth in average loans and investment securities purchases, partially offset by a decline in excess liquidity and average loans held for sale. The Company’s net interest margin during the first nine months of 2023 was 3.63%, down four basis points from 3.67% reported for the first nine months of 2022. Loan production in the lines of business (including retail mortgage, warehouse lending, SBA and premium finance) amounted to $12.32 billion during the first nine months of 2023, with weighted average yields of 6.91%, compared with $14.53 billion and 4.39%, respectively, during the first nine months of 2022. Loan production in the banking division amounted to $1.7 billion during the first nine months of 2023 with weighted average yields of 9.20%, compared with $3.0 billion and 5.60%, respectively, during the first nine months of 2022.

Total interest income, on a tax-equivalent basis, increased to $951.1 million during the nine months ended September 30, 2023, compared with $623.2 million in the same period of 2022. Yields on earning assets increased to 5.46% during the first nine months of 2023, compared with 3.94% reported in the same period of 2022. During the first nine months of 2023, loans comprised 88.7% of average earning assets, compared with 84.1% in the same period of 2022. Yields on loans increased to 5.64% during the nine months ended September 30, 2023, compared with 4.44% in the same period of 2022.
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The yield on total interest-bearing liabilities increased from 0.48% during the nine months ended September 30, 2022 to 2.86% in the same period of 2023. Total funding costs, inclusive of noninterest-bearing demand deposits, increased to 1.96% in the first nine months of 2023, compared with 0.29% during the same period of 2022. Deposit costs increased from 0.16% in the first nine months of 2022 to 1.65% in the same period of 2023. Non-deposit funding costs increased from 4.59% in the first nine months of 2022 to 5.29% in the same period of 2023. The increase in non-deposit funding costs was driven primarily by an increase in index rates. Average balances of interest bearing deposits and their respective costs for the nine months ended September 30, 2023 and 2022 are shown below:

  Nine Months Ended
September 30, 2023		 Nine Months Ended
September 30, 2022
(dollars in thousands) Average
Balance		 Average
Cost		 Average
Balance		 Average
Cost
NOW $ 3,917,476  1.72% $ 3,693,829  0.21%
MMDA 5,176,794  2.81% 5,117,528  0.33%
Savings 976,684  0.74% 1,003,995  0.08%
Retail CDs 1,947,739  2.84% 1,657,193  0.33%
Brokered CDs 991,554  5.19% —  —%
Interest-bearing deposits $ 13,010,247  2.51% $ 11,472,545  0.27%
 
Provision for Credit Losses
 
The Company’s provision for credit losses during the nine months ended September 30, 2023 amounted to $119.7 million, compared with $38.8 million in the nine months ended September 30, 2022. This increase was primarily attributable to the updated economic forecast and organic growth in loans during the first nine months of 2023. The provision for credit losses for the first nine months of 2023 was comprised of $123.1 million related to loans, negative $3.4 million related to unfunded commitments and $5,000 related to other credit losses, compared with $28.0 million related to loans, $11.0 million related to unfunded commitments and negative $135,000 related to other credit losses for the same period in 2022. Non-performing assets as a percentage of total assets decreased from 0.61% at December 31, 2022 to 0.58% at September 30, 2023. The decrease in non-performing assets is primarily attributable to a decrease in accruing loans delinquent 90 days or more of $6.0 million, partially offset by an increase in other real estate owned of $2.6 million. Net charge-offs on loans during the first nine months of 2023 were $37.0 million, or 0.25% of average loans on an annualized basis, compared with approximately $10.7 million, or 0.08%, in the first nine months of 2022. The Company’s total allowance for credit losses on loans at September 30, 2023 was $290.1 million, or 1.44% of total loans, compared with $205.7 million, or 1.04% of total loans, at December 31, 2022. This increase is primarily attributable to organic growth in loans and the updated economic forecast.

Noninterest Income

Total noninterest income for the nine months ended September 30, 2023 was $186.6 million, a decrease of $49.5 million, or 21.0%, from the $236.1 million reported for the nine months ended September 30, 2022.  Income from mortgage banking activities decreased $53.6 million, or 33.1%, from $162.0 million in the first nine months of 2022 to $108.4 million in the same period of 2023. Total production in the first nine months of 2023 amounted to $3.45 billion, compared with $4.52 billion in the same period of 2022, while spread (gain on sale) decreased to 2.11% during the nine months ended September 30, 2023, compared with 2.48% in the same period of 2022. The retail mortgage open pipeline was $623.9 million at September 30, 2023, compared with $507.1 million at December 31, 2022 and $520.0 million at September 30, 2022. Mortgage banking activities was positively impacted during the first nine months of 2022 by a recovery of previous mortgage servicing right impairment of $21.8 million, compared with no such recovery for the same period in 2023.

Other noninterest income increased $3.1 million, or 8.4%, to $40.7 million for the first nine months of 2023, compared with $37.5 million during the same period of 2022. The increase in other noninterest income was primarily attributable to increases in fee income from equipment finance, BOLI income, gain on debt redemption and derivative fee income of $3.8 million, $1.3 million, $1.1 million and $1.2 million, respectively, partially offset by a decrease of $3.7 million in trust income after exiting this business at the end of 2022.

Noninterest Expense

Total noninterest expenses for the nine months ended September 30, 2023 increased $3.7 million, or 0.9%, to $429.3 million, compared with $425.6 million in the same period of 2022. Salaries and employee benefits decreased $379,000, or 0.2%, from $244.5 million in the first nine months of 2022 to $244.1 million in the same period of 2023. Data processing and communications expenses increased $2.7 million, or 7.4%, to $39.5 million in the first nine months of 2023, from $36.7 million reported in the same period of 2022.
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Credit resolution-related expenses increased $266,000, or 77.6%, from negative $343,000 in the first nine months of 2022 to negative $77,000 in the same period of 2023. Advertising and marketing expense was $8.9 million in the first nine months of 2023, compared with $8.7 million in the first nine months of 2022. Amortization of intangible assets decreased $1.2 million, or 8.1%, from $15.0 million in the first nine months of 2022 to $13.8 million in the first nine months of 2023. This decrease was primarily related to a reduction in core deposit intangible amortization. There were no merger and conversion charges in the first nine months of 2023, compared with $977,000 in the same period in 2022. Loan servicing expenses decreased $2.1 million, or 7.2%, from $28.5 million in the first nine months of 2022 to $26.4 million in the same period of 2023, primarily attributable to the sale of a portion of our mortgage servicing portfolio during the third quarter of 2022, partially offset by additional mortgage loans added from mortgage production over the previous year. Other noninterest expenses increased $5.3 million, or 10.0%, from $53.1 million in the first nine months of 2022 to $58.4 million in the same period of 2023, due primarily to increases of $5.8 million in FDIC insurance expenses and $1.7 million in legal and professional fees. These increases in other noninterest expenses were partially offset by a decrease from the first nine months of 2022 in fraud/forgery losses of $1.1 million and variable expenses tied to production in our mortgage division.

Income Taxes

Income tax expense is influenced by the statutory rate, the amount of taxable income, the amount of tax-exempt income and the amount of nondeductible expenses. For the nine months ended September 30, 2023, the Company reported income tax expense of $63.4 million, compared with $84.2 million in the same period of 2022. The Company’s effective tax rate for the nine months ended September 30, 2023 and 2022 was 23.8% and 24.2%, respectively. The decrease in the effective tax rate is primarily a result of a discrete charge to the Company's state tax liability and nondeductible merger and conversion charges incurred during the first nine months of 2022.

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Financial Condition as of September 30, 2023

Securities

Debt securities classified as available-for-sale are recorded at fair value with unrealized holding gains and losses excluded from earnings and reported in accumulated other comprehensive income, net of the related deferred tax effect. Securities available-for-sale may be bought and sold in response to changes in market conditions, including, but not limited to, fluctuations in interest rates, changes in securities' prepayment risk, increases in loan demand, general liquidity needs and positioning the portfolio to take advantage of market conditions that create more economically attractive returns. Debt securities are classified as held-to-maturity based on management's positive intent and ability to hold such securities to maturity and are carried at amortized cost. Restricted equity securities are classified as other investment securities and are carried at cost and are periodically evaluated for impairment based on the ultimate recovery of par value or cost basis.

The amortization of premiums and accretion of discounts are recognized in interest income using methods approximating the interest method over the expected life of the securities. Realized gains and losses, determined on the basis of the cost of specific securities sold, are included in earnings on the trade date. 

Management and the Company’s ALCO Committee evaluate available-for-sale securities in an unrealized loss position on at least a quarterly basis, and more frequently when economic or market concerns warrant such evaluation, to determine if credit-related impairment exists. Management first evaluates whether they intend to sell or more likely than not will be required to sell an impaired security before recovering its amortized cost basis. If either criteria is met, the entire amount of unrealized loss is recognized in earnings with a corresponding adjustment to the security's amortized cost basis. If either of the above criteria is not met, management evaluates whether the decline in fair value is attributable to credit or resulted from other factors. If credit-related impairment exists, the Company recognizes an allowance for credit losses, limited to the amount by which the fair value is less than the amortized cost basis. Any impairment not recognized through an allowance for credit losses is recognized in other comprehensive income, net of tax, as a non credit-related impairment. The Company does not intend to sell these available-for-sale investment securities at an unrealized loss position at September 30, 2023, and it is more likely than not that the Company will not be required to sell these securities prior to recovery or maturity. Based on the results of management's review, at September 30, 2023, management determined that $80,000 was attributable to credit impairment and, accordingly, an allowance for credit losses was established. The remaining $78.1 million in unrealized loss was determined to be from factors other than credit.

The Company's held-to-maturity securities have no expected credit losses, and no related allowance for credit losses has been established.

The following table is a summary of our investment portfolio at the dates indicated:

September 30, 2023 December 31, 2022
(dollars in thousands) Amortized Cost Fair
Value		 Amortized Cost Fair
Value
Securities available-for-sale
U.S. Treasuries $ 781,154  $ 760,596  $ 775,784  $ 759,534 
U.S. government-sponsored agencies 1,026  969  1,036  979 
State, county and municipal securities 29,492  27,703  35,358  34,195 
Corporate debt securities 16,171  15,036  16,397  15,926 
SBA pool securities 23,834  21,751  29,422  27,398 
Mortgage-backed securities 650,535  598,026  701,008  662,028 
Total debt securities available-for-sale $ 1,502,212  $ 1,424,081  $ 1,559,005  $ 1,500,060 
Securities held-to-maturity
State, county and municipal securities $ 31,905  $ 24,555  $ 31,905  $ 26,525 
Mortgage-backed securities 109,954  91,134  102,959  88,013 
Total debt securities held-to-maturity $ 141,859  $ 115,689  $ 134,864  $ 114,538 

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The amounts of securities available-for-sale and held-to-maturity in each category as of September 30, 2023 are shown in the following table according to contractual maturity classifications: (i) one year or less; (ii) after one year through five years; (iii) after five years through ten years; and (iv) after ten years:

U.S. Treasuries U.S. Government-Sponsored Agencies State, County and
Municipal Securities
(dollars in thousands)
Securities available-for-sale (1)
 Amount Yield
 (2)		 Amount Yield
 (2)		 Amount Yield
(2)(3)
One year or less $ 373,910  3.91  % $ —  —  % $ 1,934  3.97  %
After one year through five years 386,686  2.57  969  2.16  16,151  3.94 
After five years through ten years —  —  —  —  4,031  4.56 
After ten years —  —  —  —  5,587  3.63 
$ 760,596  3.22  % $ 969  2.16  % $ 27,703  3.96  %
Corporate Debt Securities SBA Pool Securities Mortgage-Backed Securities
(dollars in thousands)
Securities available-for-sale (1)
 Amount Yield
 (2)		 Amount Yield
 (2)		 Amount Yield
 (2)
One year or less $ —  —  % $ —  —  % $ 15,255  1.93  %
After one year through five years 13,697  7.12  4,881  2.12  281,553  3.20 
After five years through ten years —  —  5,866  2.64  91,745  2.88 
After ten years 1,339  8.63  11,004  3.21  209,473  3.29 
$ 15,036  7.30  % $ 21,751  2.81  % $ 598,026  3.16  %
State, County and
Municipal Securities		 Mortgage-Backed Securities
(dollars in thousands)
Securities held-to-maturity (1)
 Amount Yield
(2)(3)		 Amount Yield
 (2)
One year or less $ —  —  % $ —  —  %
After one year through five years —  —  11,882  1.34 
After five years through ten years —  —  66,008  2.55 
After ten years 31,905  3.93  32,064  2.61 
$ 31,905  3.93  % $ 109,954  2.44  %
(1)The amortized cost of securities held-to-maturity and fair value of securities available-for-sale are presented based on contractual maturities. Actual cash flows may differ from contractual maturities because borrowers may have the right to prepay obligations without prepayment penalties.
(2)Yields were computed using coupon interest, adding discount accretion or subtracting premium amortization, as appropriate, on a ratable basis over the life of each security. The weighted average yield for each maturity range was computed using the amortized cost of each security in that range.
(3)Yields on securities of state and political subdivisions are stated on a taxable-equivalent basis, using a tax rate of 21%.

Loans and Allowance for Credit Losses

At September 30, 2023, gross loans outstanding (including loans and loans held for sale) were $20.58 billion, up $335.2 million from $20.25 billion reported at December 31, 2022. Loans increased $345.8 million, or 1.7%, from $19.86 billion at December 31, 2022 to $20.20 billion at September 30, 2023, driven primarily by organic growth. Loans held for sale decreased from $392.1 million at December 31, 2022 to $381.5 million at September 30, 2023 primarily in our mortgage division.

The Company regularly monitors the composition of the loan portfolio to evaluate the adequacy of the allowance for credit losses ("ACL") on loans in light of the impact that changes in the economic environment may have on the loan portfolio. The Company focuses on the following loan categories: (1) commercial, financial and agricultural; (2) consumer; (3) indirect automobile; (4) mortgage warehouse; (5) municipal; (6) premium finance; (7) construction and development related real estate; (8) commercial and farmland real estate; and (9) residential real estate. The Company’s management has strategically located its branches in select markets in Georgia, Alabama, Florida, North Carolina and South Carolina to take advantage of the growth in these areas.
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The Company’s risk management processes include a loan review program designed to evaluate the credit risk in the loan portfolio and ensure credit grade accuracy. Through the loan review process, the Company conducts (1) a loan portfolio summary analysis, (2) charge-off and recovery analysis, (3) trends in accruing problem loan analysis, and (4) problem and past-due loan analysis. This analysis process serves as a tool to assist management in assessing the overall quality of the loan portfolio and the adequacy of the ACL. Loans classified as “substandard” are loans which are inadequately protected by the current sound worth and paying capacity of the borrower or of the collateral pledged. These assets exhibit a well-defined weakness or are characterized by the distinct possibility that the Company will sustain some loss if the deficiencies are not corrected. These weaknesses may be characterized by past due performance, operating losses and/or questionable collateral values. Loans classified as “doubtful” are those loans that have characteristics similar to substandard loans but have an increased risk of loss. Loans classified as “loss” are those loans which are considered uncollectible and are in the process of being charged off.

The Company estimates the ACL on loans based on the underlying assets’ amortized cost basis, which is the amount at which the financing receivable is originated or acquired, adjusted for applicable accretion or amortization of premium, discount, and net deferred fees or costs, collection of cash, and charge-offs. In the event that collection of principal becomes uncertain, the Company has policies in place to reverse accrued interest in a timely manner. Therefore, the Company has made a policy election to exclude accrued interest from the measurement of ACL.

Expected credit losses are reflected in the ACL through a charge to credit loss expense. When the Company deems all or a portion of a financial asset to be uncollectible the appropriate amount is written off and the ACL is reduced by the same amount. The Company applies judgment to determine when a financial asset is deemed uncollectible; however, generally speaking, an asset will be considered uncollectible no later than when all efforts at collection have been exhausted. Subsequent recoveries, if any, are credited to the ACL when received.

The Company measures expected credit losses of financial assets on a collective (pool) basis, when the financial assets share similar risk characteristics. Depending on the nature of the pool of financial assets with similar risk characteristics, the Company currently uses the DCF method or the PD×LGD method which may be adjusted for qualitative factors.

The Company’s methodologies for estimating the ACL consider available relevant information about the collectability of cash flows, including information about past events, current conditions, and reasonable and supportable forecasts. The methodologies apply historical loss information, adjusted for asset-specific characteristics, economic conditions at the measurement date, and forecasts about future economic conditions expected to exist through the contractual lives of the financial assets that are reasonable and supportable, to the identified pools of financial assets with similar risk characteristics for which the historical loss experience was observed. The Company’s methodologies revert back to historical loss information on a straight-line basis over four quarters when the Company can no longer develop reasonable and supportable forecasts.

At the end of the third quarter of 2023, the ACL on loans totaled $290.1 million, or 1.44% of loans, compared with $205.7 million, or 1.04% of loans, at December 31, 2022. Our nonaccrual loans decreased from $134.8 million at December 31, 2022 to $134.6 million at September 30, 2023. For the first nine months of 2023, our net charge off ratio as a percentage of average loans increased to 0.25%, compared with 0.08% for the first nine months of 2022. The total provision for credit losses for the first nine months of 2023 was $119.7 million, increasing from a provision of $38.8 million recorded for the first nine months of 2022. Our ratio of total nonperforming assets to total assets was down three basis points from 0.61% at December 31, 2022 to 0.58% at September 30, 2023.

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The following table presents an analysis of the allowance for credit losses on loans, provision for credit losses on loans and net charge-offs as of and for the nine months ended September 30, 2023 and 2022:

Nine Months Ended
September 30,
(dollars in thousands) 2023 2022
Balance of allowance for credit losses on loans at beginning of period $ 205,677  $ 167,582 
Adjustment to allowance for adoption of ASU 2022-02 (1,711) — 
Provision charged to operating expense 123,114  27,962 
Charge-offs:    
Commercial, financial and agricultural 42,068  13,527 
Consumer 4,140  3,790 
Indirect automobile 135  179 
Premium finance 5,220  3,640 
Real estate – commercial and farmland 3,320  3,378 
Real estate – residential 231  190 
Total charge-offs 55,114  24,704 
Recoveries:
Commercial, financial and agricultural 10,333  7,882 
Consumer 694  665 
Indirect automobile 599  816 
Premium finance 4,701  3,383 
Real estate – construction and development 646  669 
Real estate – commercial and farmland 476  177 
Real estate – residential 689  459 
Total recoveries 18,138  14,051 
Net charge-offs 36,976  10,653 
Balance of allowance for credit losses on loans at end of period $ 290,104  $ 184,891 

The following table presents an analysis of the allowance for credit losses on loans and net charge-offs for loans held for investment:

As of and for the Nine Months Ended
(dollars in thousands) September 30, 2023 September 30, 2022
Allowance for credit losses on loans at end of period $ 290,104  $ 184,891 
Net charge-offs for the period 36,976  10,653 
Loan balances:
End of period 20,201,079  18,806,856 
Average for the period 20,121,143  16,951,566 
Net charge-offs as a percentage of average loans (annualized) 0.25  % 0.08  %
Allowance for credit losses on loans as a percentage of end of period loans 1.44  % 0.98  %

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Loans

Loans are stated at amortized cost. Balances within the major loans receivable categories are presented in the following table:

(dollars in thousands) September 30, 2023 December 31, 2022
Commercial, financial and agricultural $ 2,632,836  $ 2,679,403 
Consumer 259,797  384,037 
Indirect automobile 47,108  108,648 
Mortgage warehouse 852,823  1,038,924 
Municipal 497,093  509,151 
Premium finance 1,007,334  1,023,479 
Real estate – construction and development 2,236,686  2,086,438 
Real estate – commercial and farmland 7,865,389  7,604,867 
Real estate – residential 4,802,013  4,420,306 
$ 20,201,079  $ 19,855,253 

Non-Performing Assets

Non-performing assets include nonaccrual loans, accruing loans contractually past due 90 days or more, repossessed personal property, and OREO. Loans are placed on nonaccrual status when management has concerns relating to the ability to collect the principal and interest and generally when such loans are 90 days or more past due. Management performs a detailed review and valuation assessment of non-performing loans over $250,000 on a quarterly basis. When a loan is placed on nonaccrual status, any interest previously accrued but not collected is reversed against current income.

Nonaccrual loans totaled $134.6 million at September 30, 2023, a decrease of $250,000, or 0.2%, from $134.8 million at December 31, 2022. Accruing loans delinquent 90 days or more totaled $11.9 million at September 30, 2023, a decrease of $6.0 million, or 33.4%, compared with $17.9 million at December 31, 2022. At September 30, 2023, OREO totaled $3.4 million, an increase of $2.6 million, or 303.0%, compared with $843,000 at December 31, 2022. Management regularly assesses the valuation of OREO through periodic reappraisal and through inquiries received in the marketing process.  At the end of the third quarter of 2023, total non-performing assets as a percent of total assets was down three basis points from 0.61% at December 31, 2022 to 0.58% at September 30, 2023.

Non-performing assets at September 30, 2023 and December 31, 2022 were as follows:

(dollars in thousands) September 30, 2023 December 31, 2022
Nonaccrual loans(1)
 $ 134,558  $ 134,808 
Accruing loans delinquent 90 days or more 11,891  17,865 
Repossessed assets 22  28 
Other real estate owned 3,397  843 
Total non-performing assets $ 149,868  $ 153,544 

(1) Included in nonaccrual loans were $80.8 million and $69.6 million of serviced GNMA-guaranteed nonaccrual loans at September 30, 2023 and December 31, 2022, respectively.
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Commercial Lending Practices

The federal bank regulatory agencies previously issued interagency guidance on commercial real estate lending and prudent risk management practices. This guidance defines commercial real estate (“CRE”) loans as loans secured by raw land, land development and construction (including one-to-four family residential construction), multi-family property and non-farm nonresidential property where the primary or a significant source of repayment is derived from rental income associated with the property, excluding owner-occupied properties (loans for which 50% or more of the source of repayment is derived from the ongoing operations and activities conducted by the party, or affiliate of the party, who owns the property) or the proceeds of the sale, refinancing or permanent financing of the property. Loans for owner-occupied CRE are generally excluded from the CRE guidance.

The CRE guidance is applicable when either:

(1)total loans for construction, land development, and other land, net of owner-occupied loans, represent 100% or more of a tier I capital plus allowance for credit losses on loans and leases; or
(2)total loans secured by multifamily and nonfarm nonresidential properties and loans for construction, land development, and other land, net of owner-occupied loans, represent 300% or more of a bank’s tier I capital plus allowance for credit losses on loans and leases.

Banks that are subject to the CRE guidance criteria are required to implement enhanced strategic planning, CRE underwriting policies, risk management and internal controls, portfolio stress testing, risk exposure limits, and other policies, including management compensation and incentives, to address the CRE risks. Higher allowances for loan losses and capital levels may also be appropriate.

As of September 30, 2023, the Company exhibited a concentration in the CRE loan category based on Federal Reserve Call codes. The primary risks of CRE lending are:

(1)within CRE loans, construction and development loans are somewhat dependent upon continued strength in demand for residential real estate, which is reliant on favorable real estate mortgage rates and changing population demographics;
(2)on average, CRE loan sizes are generally larger than non-CRE loan types; and
(3)certain construction and development loans may be less predictable and more difficult to evaluate and monitor.

The following table outlines CRE loan categories and CRE loans as a percentage of total loans as of September 30, 2023 and December 31, 2022. The loan categories and concentrations below are based on Federal Reserve Call codes:

September 30, 2023 December 31, 2022
(dollars in thousands) Balance % of Total
Loans		 Balance % of Total
Loans
Construction and development loans $ 2,236,686  11% $ 2,086,438  11%
Multi-family loans 900,675  4% 779,027  4%
Nonfarm non-residential loans (excluding owner-occupied) 4,875,580  24% 4,796,358  24%
Total CRE Loans (excluding owner-occupied)
 8,012,941  40% 7,661,823  39%
All other loan types 12,188,138  60% 12,193,430  61%
Total Loans $ 20,201,079  100% $ 19,855,253  100%

The following table outlines the percentage of construction and development loans and total CRE loans, net of owner-occupied loans, to the Bank’s tier I capital plus allowance for credit losses on loans and leases, and the Company’s internal concentration limits as of September 30, 2023 and December 31, 2022:

Internal
Limit		 Actual
September 30, 2023 December 31, 2022
Construction and development loans 100% 79% 79%
Total CRE loans (excluding owner-occupied) 300% 283% 292%

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Short-Term Investments

The Company’s short-term investments are comprised of federal funds sold and interest-bearing deposits in banks. At September 30, 2023, the Company’s short-term investments were $1.30 billion, compared with $833.6 million at December 31, 2022, all of which was in interest-bearing deposit balances at correspondent banks and the Federal Reserve Bank of Atlanta.

Derivative Instruments and Hedging Activities

The Company has forward contracts and IRLCs to economically hedge changes in the value of the mortgage inventory due to changes in market interest rates. The fair value of these instruments amounted to an asset of $8.8 million and $3.9 million at September 30, 2023 and December 31, 2022, respectively. The Company also enters into interest rate derivative agreements to facilitate the risk management strategies of certain clients. The Company mitigates this risk by entering into equal and offsetting interest rate swap agreements with highly rated third-party financial institutions. The fair value of these instruments amounted to an asset of $13.2 million and $4.6 million at September 30, 2023 and December 31, 2022, respectively, and a liability of $13.0 million and $4.6 million at September 30, 2023 and December 31, 2022, respectively.

Deposits

Total deposits at the Company increased $1.13 billion, or 5.8%, to $20.59 billion at September 30, 2023, compared with $19.46 billion at December 31, 2022. Noninterest-bearing deposits decreased $1.34 billion, or 16.9%, while interest-bearing deposits increased $2.47 billion, or 21.4%, during the first nine months of 2023. The decrease in noninterest-bearing deposits was attributable to a shift in consumer behavior to interest-bearing accounts as interest rates have risen. At September 30, 2023, the Company had approximately $1.47 billion in short-term brokered CDs, compared with none at December 31, 2022. As of September 30, 2023 and December 31, 2022, the Company had estimated uninsured deposits of $8.43 billion and $9.30 billion, respectively. These estimates were derived using the same methodologies and assumptions used for the Bank's regulatory reporting. Approximately $2.27 billion, or 26.9%, of the uninsured deposits at September 30, 2023 were for municipalities which are collateralized with investment securities or letters of credit.

Capital

Common Stock Repurchase Program

On September 19, 2019, the Company announced that its Board of Directors authorized the Company to repurchase up to $100.0 million of its outstanding common stock through October 31, 2020. The Board has subsequently extended the share repurchase program each year since that original authorization, with the most recent extension, which also included the replenishment of the program to $100.0 million, being announced on October 26, 2023. As a result, the Company is currently authorized to engage in additional share repurchases up to $100.0 million through October 31, 2024.  Repurchases of shares must be made in accordance with applicable securities laws and may be made from time to time in the open market or by negotiated transactions. The amount and timing of repurchases will be based on a variety of factors, including share acquisition price, regulatory limitations and other market and economic factors. The program does not require the Company to repurchase any specific number of shares. As of September 30, 2023, an aggregate of $13.5 million, or 405,233 shares of the Company's common stock, had been repurchased under the program's October 27, 2022 renewal, which also included the replenishment of the program to $100.0 million.

Capital Management

Capital management consists of providing equity to support both current and anticipated future operations. The capital resources of the Company are monitored on a periodic basis by state and federal regulatory authorities.

Under the regulatory capital frameworks adopted by the Federal Reserve Board (the "FRB") and the Federal Deposit Insurance Corporation (the "FDIC"), the Company and the Bank must each maintain a common equity Tier 1 capital to total risk-weighted assets ratio of at least 4.5%, a Tier 1 capital to total risk-weighted assets ratio of at least 6%, a total capital to total risk-weighted assets ratio of at least 8% and a leverage ratio of Tier 1 capital to average total consolidated assets of at least 4%. The Company and the Bank are also required to maintain a capital conservation buffer of common equity Tier 1 capital of at least 2.5% of risk-weighted assets in addition to the minimum risk-based capital ratios in order to avoid certain restrictions on capital distributions and discretionary bonus payments.

In March 2020, the Office of the Comptroller of the Currency, the FRB and the FDIC issued an interim final rule that delays the estimated impact on regulatory capital stemming from the implementation of CECL.
52

The interim final rule provides banking organizations that implement CECL in 2020 the option to delay for two years an estimate of CECL’s effect on regulatory capital, relative to the incurred loss methodology’s effect on regulatory capital, followed by a three-year transition period. As a result, the Company and Bank elected the five-year transition relief allowed under the interim final rule effective March 31, 2020.

As of September 30, 2023, under the regulatory capital standards, the Bank was considered “well capitalized” under all capital measurements. The following table sets forth the regulatory capital ratios of for the Company and the Bank at September 30, 2023 and December 31, 2022:

September 30, 2023 December 31, 2022
Tier 1 Leverage Ratio (tier 1 capital to average assets)
    
Consolidated 9.62% 9.36%
Ameris Bank 10.51% 10.56%
CET1 Ratio (common equity tier 1 capital to risk weighted assets)
    
Consolidated 10.82% 9.86%
Ameris Bank 11.81% 11.12%
Tier 1 Capital Ratio (tier 1 capital to risk weighted assets)
    
Consolidated 10.82% 9.86%
Ameris Bank 11.81% 11.12%
Total Capital Ratio (total capital to risk weighted assets)
    
Consolidated 14.01% 12.90%
Ameris Bank 13.41% 12.28%

Interest Rate Sensitivity and Liquidity

The Company’s primary market risk exposures are credit risk, interest rate risk, and liquidity risk. The Bank operates under an Asset Liability Management Policy approved by the Company’s Board of Directors and the ALCO Committee. The policy outlines limits on interest rate risk in terms of changes in net interest income and changes in the net market values of assets and liabilities over certain changes in interest rate environments. These measurements are made through a simulation model which projects the impact of changes in interest rates on the Bank’s assets and liabilities. The policy also outlines responsibility for monitoring interest rate risk, and the process for the approval, implementation and monitoring of interest rate risk strategies to achieve the Bank’s interest rate risk objectives.

The ALCO Committee is comprised of senior officers of Ameris. The ALCO Committee makes all strategic decisions with respect to the sources and uses of funds that may affect net interest income, including net interest spread and net interest margin. The objective of the ALCO Committee is to identify the interest rate, liquidity and market value risks of the Company’s balance sheet and use reasonable methods approved by the Company’s Board of Directors and executive management to minimize those identified risks.

The normal course of business activity exposes the Company to interest rate risk. Interest rate risk is managed within an overall asset and liability framework for the Company. The principal objectives of asset and liability management are to predict the sensitivity of net interest spreads to potential changes in interest rates, control risk and enhance profitability. Funding positions are kept within predetermined limits designed to properly manage risk and liquidity. The Company employs sensitivity analysis in the form of a net interest income simulation to help characterize the market risk arising from changes in interest rates. In addition, fluctuations in interest rates usually result in changes in the fair market value of the Company’s financial instruments, cash flows and net interest income. The Company’s interest rate risk position is managed by the ALCO Committee.

The Company uses a simulation modeling process to measure interest rate risk and evaluate potential strategies. Interest rate scenario models are prepared using software created and licensed from an outside vendor. The Company’s simulation includes all financial assets and liabilities. Simulation results quantify interest rate risk under various interest rate scenarios. Management then develops and implements appropriate strategies. The ALCO Committee has determined that an acceptable level of interest rate risk would be for net interest income to increase/decrease no more than 20% given a change in selected interest rates of 200 basis points over any 24-month period.

Liquidity management involves the matching of the cash flow requirements of customers, who may be either depositors desiring to withdraw funds or borrowers needing assurance that sufficient funds will be available to meet their credit needs, and the ability of Ameris to manage those requirements. The Company strives to maintain an adequate liquidity position by managing the balances and maturities of interest-earning assets and interest-bearing liabilities so that the balance it has in short-term assets at any given time will adequately cover any reasonably anticipated immediate need for funds.
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Additionally, the Bank maintains relationships with correspondent banks, which could provide funds on short notice, if needed. The Company has invested in FHLB stock for the purpose of establishing credit lines with the FHLB. The credit availability to the Bank is equal to 30% of the Bank’s total assets as reported on the most recent quarterly financial information submitted to the regulators subject to the pledging of sufficient collateral. At September 30, 2023 and December 31, 2022, the net carrying value of the Company’s other borrowings was $1.21 billion and $1.88 billion, respectively. At September 30, 2023, the Company had availability with the FHLB and FRB Discount Window of $3.62 billion and $2.63 billion, respectively.

The following liquidity ratios compare certain assets and liabilities to total deposits or total assets:

September 30,
2023		 June 30,
2023		 March 31,
2023		 December 31,
2022		 September 30,
2022
Investment securities available-for-sale to total deposits 6.92% 7.14% 7.52% 7.71% 6.45%
Loans (net of unearned income) to total deposits 98.11% 100.14% 100.50% 102.02% 96.61%
Interest-earning assets to total assets 91.67% 91.51% 91.71% 91.11% 90.76%
Interest-bearing deposits to total deposits 68.00% 67.19% 61.60% 59.26% 57.14%

The liquidity resources of the Company are monitored continually by the ALCO Committee and on a periodic basis by state and federal regulatory authorities. As determined under guidelines established by these regulatory authorities, the Company’s and the Bank’s liquidity ratios at September 30, 2023 were considered satisfactory. The Company is aware of no events or trends likely to result in a material change in liquidity.

Goodwill Impairment Testing

The Company has goodwill at its Banking Division and Premium Finance Division (collectively "the divisions"). The carrying value of goodwill at the Banking Division was $951.1 million at both September 30, 2023 and December 31, 2022. The carrying value of goodwill at the Premium Finance Division was $64.5 million at both September 30, 2023 and December 31, 2022. The Company performs its annual impairment test at December 31 of each year and more frequently if a triggering event occurs. At December 31, 2022, the Company performed a qualitative assessment of goodwill at the divisions and determined it was more likely than not that, in each case, the reporting unit's fair value exceeded its carrying value. The Company performed an interim qualitative assessment at March 31, 2023 considering the decline in the Company's stock price relative to book value and the impact of recent bank failures on the economy and again determined that it was more likely than not that each reporting unit's fair value exceeded its carrying value.

During the second quarter of 2023, the Company assessed the indicators of goodwill impairment and determined a triggering event had occurred due to the sustained decline in the Company's stock price. The Company performed a quantitative analysis of goodwill at the divisions as of June 30, 2023. The Premium Finance Division was measured utilizing a discounted cash flow approach. The Banking Division was measured using multiple approaches. The primary approach for the Banking Division was the discounted cash flow approach, and the Company also used a market approach comparing to similar public companies' multiples and control premiums from transactions during prior distressed periods. The results from each of the primary approaches showed valuation of the reporting unit in excess of carrying value at June 30, 2023. The discounted cash flow approach for the Premium Finance Division resulted in a fair value approximately 8% higher than its carrying value. The discounted cash flow approach for the Banking Division indicated a fair value approximately 20% higher than its carrying value, and the market approach indicated a fair value approximately 9% higher than its carrying value. As a result, management determined no impairment existed at June 30, 2023. At September 30, 2023, the Company assessed the indicators of goodwill impairment and determined a triggering event had not occurred and no impairment test was performed. The Company will perform its annual impairment test at December 31, 2023.

Each of the valuation methods used by the Company requires significant assumptions. Depending on the specific method, assumptions are made regarding growth rates, discount rates for cash flows, control premiums, and selected multiples. Changes to any of the assumptions could result in significantly different results.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

The Company is exposed only to U.S. dollar interest rate changes, and, accordingly, the Company manages exposure by considering the possible changes in the net interest margin. The Company does not have any trading instruments nor does it classify any portion of the investment portfolio as held for trading. 

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The Company also had forward contracts and IRLCs to economically hedge changes in the value of the mortgage inventory due to changes in market interest rates. The fair value of these instruments amounted to an asset of approximately $8.8 million and $3.9 million at September 30, 2023 and December 31, 2022, respectively. The Company also enters into interest rate derivative agreements to facilitate the risk management strategies of certain clients. The Company mitigates this risk by entering into equal and offsetting interest rate swap agreements with highly rated third-party financial institutions. The fair value of these instruments amounted to an asset of $13.2 million and $4.6 million at September 30, 2023 and December 31, 2022, respectively, and a liability of $13.0 million and $4.6 million at September 30, 2023 and December 31, 2022, respectively.

The Company has no exposure to foreign currency exchange rate risk, commodity price risk and other market risks.

Interest rates play a major part in the net interest income of a financial institution. The sensitivity to rate changes is known as “interest rate risk.” The repricing of interest-earning assets and interest-bearing liabilities can influence the changes in net interest income. As part of the Company’s asset/liability management program, the timing of repriced assets and liabilities is referred to as “gap management.”

The Company uses simulation analysis to monitor changes in net interest income due to changes in market interest rates. The simulation of rising, declining and flat interest rate scenarios allows management to monitor and adjust interest rate sensitivity to minimize the impact of market interest rate swings. The analysis of the impact on net interest income over a 12-month and 24-month period is subjected to gradual and parallel shocks of 100, 200, 300 and 400 basis point increases and decreases in market rates and is monitored on a quarterly basis.

The following table presents the earnings simulation model’s projected impact of a change in interest rates on the projected baseline net interest income for the 12- and 24-month periods commencing October 1, 2023. This change in interest rates assumes parallel shifts in the yield curve and does not take into account changes in the slope of the yield curve.

Earnings Simulation Model Results
Change in % Change in Projected Baseline
Interest Rates Net Interest Income
(in bps) 12 Months 24 Months
400 (5.5)% 5.9%
300 (2.4)% 6.1%
200 (0.1)% 5.3%
100 0.2% 2.9%
(100) (0.3)% (2.3)%
(200) (0.7)% (5.1)%
(300) (1.3)% (8.4)%
(400) (1.9)% (11.7)%

Additional information required by Item 305 of Regulation S-K is set forth under Part I, Item 2 of this report.

Item 4. Controls and Procedures.

The Company’s Chief Executive Officer and Chief Financial Officer have evaluated the Company’s disclosure controls and procedures (as such term is defined in Rules 13a-15(e) or 15d-15(e) promulgated under the Exchange Act) as of the end of the period covered by this report, as required by paragraph (b) of Rules 13a-15 or 15d-15 of the Exchange Act. Based on such evaluation, such officers have concluded that, as of the end of the period covered by this report, the Company’s disclosure controls and procedures were effective.

During the quarter ended September 30, 2023, there was no change in the Company’s internal control over financial reporting identified in connection with the evaluation required by paragraph (d) of Rules 13a-15 or 15d-15 of the Exchange Act that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.
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PART II - OTHER INFORMATION

Item 1. Legal Proceedings.

Disclosure concerning legal proceedings can be found in Part I - "Financial Information, Item 1. Financial Statements, Notes to Unaudited Consolidated Financial Statements, Note 8 – Commitments and Contingencies" under the caption, "Litigation and Regulatory Contingencies," which is incorporated herein by reference.

Item 1A. Risk Factors.

There have not been any material changes to the risk factors disclosed in Item 1A. of Part I of the Company's Annual Report on Form 10-K for the year ended December 31, 2022, previously filed with the SEC.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

c) Issuer Purchases of Equity Securities.

The table below sets forth information regarding the Company’s repurchase of shares of its outstanding common stock during the three-month period ended September 30, 2023. 
Period
Total
Number of
Shares
Purchased(1)
 Average Price
Paid Per Share		 Total Number
of Shares
Purchased as
Part of Publicly
Announced
Plans or
Programs
Approximate
Dollar Value of
Shares That
 May Yet be
Purchased
Under the Plans
or Programs(2)
July 1, 2023 through July 31, 2023
 495  $ 37.02  —  $ 86,496,795 
August 1, 2023 through August 31, 2023 244  $ 43.58  —  $ 86,496,795 
September 1, 2023 through September 30, 2023 —  $ —  —  $ 86,496,795 
Total 739  $ 39.19  —  $ 86,496,795 
 
(1)The shares purchased in July 2023 and August 2023 consist of shares of common stock surrendered to the Company in payment of the income tax withholding obligations relating to the vesting of shares of restricted stock.
(2)On September 19, 2019, the Company announced that its Board of Directors authorized the Company to repurchase up to $100.0 million of its outstanding common stock through October 31, 2020. The Board has subsequently extended the share repurchase program each year since the original authorization, with the most recent extension, which also included the replenishment of the program to $100.0 million, being announced on October 26, 2023. As a result, the Company is currently authorized to engage in additional share repurchases totaling up to $100.0 million through October 31, 2024. Repurchases of shares must be made in accordance with applicable securities laws and may be made from time to time in the open market or by negotiated transactions. The amount and timing of repurchases will be based on a variety of factors, including share acquisition price, regulatory limitations and other market and economic factors. The program does not require the Company to repurchase any specific number of shares. As of September 30, 2023, an aggregate of $13.5 million, or 405,233 shares of the Company's common stock, had been repurchased under the program's October 27, 2022 renewal, which also included the replenishment of the program to $100.0 million.
Item 3. Defaults Upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

Not applicable.

Item 5. Other Information.

During the quarter ended September 30, 2023, no director or Section 16 officer of the Company adopted or terminated any Rule 10b5-1 trading arrangement or any non-Rule 10b5-1 trading arrangement (in each case, as defined in Item 408(a) of Regulation S-K).


56

Item 6. Exhibits.
Exhibit
Number		   Description
   
  Restated Articles of Incorporation of Ameris Bancorp (incorporated by reference to Exhibit 3.1 to Ameris Bancorp’s Annual Report on Form 10-K filed with the SEC on February 28, 2023).
     
  Bylaws of Ameris Bancorp, as amended and restated through February 23, 2023 (incorporated by reference to Exhibit 3.2 to Ameris Bancorp's Quarterly Report on Form 10-Q filed with the SEC on May 8, 2023).
  Rule 13a-14(a)/15d-14(a) Certification by the Company’s Chief Executive Officer.
     
  Rule 13a-14(a)/15d-14(a) Certification by the Company’s Chief Financial Officer.
     
  Section 1350 Certification by the Company’s Chief Executive Officer.
  Section 1350 Certification by the Company’s Chief Financial Officer.
101.INS XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH Inline XBRL Taxonomy Extension Schema Document.
101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF Inline XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB Inline XBRL Taxonomy Extension Label Linkbase Document.
101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase Document.
104 Cover Page Interactive Data File - the cover page interactive data file does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.


57

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
 
Dated: November 8, 2023 AMERIS BANCORP
   
  /s/ Nicole S. Stokes
  Nicole S. Stokes
  Chief Financial Officer
(duly authorized signatory and principal accounting and financial officer)

58
EX-31.1 2 abcb_exhibit311x093023-10xq.htm EX-31.1 Document

Exhibit 31.1
 
CERTIFICATION
 
I, H. Palmer Proctor, Jr., certify that:
 
1. I have reviewed this Quarterly Report on Form 10-Q for the period ended September 30, 2023, of Ameris Bancorp;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
 
(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.
5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
 
(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Dated: November 8, 2023 /s/ H. Palmer Proctor, Jr.
  H. Palmer Proctor, Jr.
  Chief Executive Officer
  (principal executive officer)
 

EX-31.2 3 abcb_exhibit312x093023-10xq.htm EX-31.2 Document

Exhibit 31.2
 
CERTIFICATION
 
I, Nicole S. Stokes, certify that:
 
1. I have reviewed this Quarterly Report on Form 10-Q for the period ended September 30, 2023, of Ameris Bancorp;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
 
(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.
5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
 
(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Dated: November 8, 2023 /s/ Nicole S. Stokes
  Nicole S. Stokes,
Chief Financial Officer
  (principal accounting and financial officer)
 
 

EX-32.1 4 abcb_exhibit321x093023-10xq.htm EX-32.1 Document

Exhibit 32.1
 
SECTION 1350 CERTIFICATION
 
I, H. Palmer Proctor, Jr., Chief Executive Officer of Ameris Bancorp (the “Company”), do hereby certify, in accordance with 18 U.S.C. § 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:
1. The Quarterly Report on Form 10-Q of the Company for the period ending September 30, 2023 (the “Periodic Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
2. The information contained in the Periodic Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
 
Dated: November 8, 2023 /s/ H. Palmer Proctor, Jr.
  H. Palmer Proctor, Jr.,
Chief Executive Officer
  (principal executive officer)
 

 


EX-32.2 5 abcb_exhibit322x093023-10xq.htm EX-32.2 Document

Exhibit 32.2
 
SECTION 1350 CERTIFICATION
 
I, Nicole S. Stokes, Executive Vice President and Chief Financial Officer of Ameris Bancorp (the “Company”), do hereby certify, in accordance with 18 U.S.C. § 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:
1. The Quarterly Report on Form 10-Q of the Company for the period ending September 30, 2023 (the “Periodic Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
2. The information contained in the Periodic Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
 
Dated: November 8, 2023 /s/ Nicole S. Stokes
  Nicole S. Stokes,
  Chief Financial Officer
  (principal accounting and financial officer)