Seacoast Banking Corporation of Florida (SBCF) Earnings

Management highlights

### Overall Financial Performance - GAAP net income totaled $59.5 million ($0.55 per diluted share), up 87% QoQ and 39% YoY. Adjusted net income was $65.8 million ($0.61 per diluted share). - Adjusted return on assets was 1.25%, and adjusted return on tangible equity was 15.8%. - Tangible book value per share grew 8% annualized in the quarter, and tangible equity to tangible assets reached 9.3%, indicating a strong capital position. ### M&A Integration Milestone - The client conversion of acquired Citizens First Bank (Villages market) to Seacoast's systems and platforms was completed successfully in Q2 2026. This was one of the company's largest and most complex integrations in history, executed flawlessly by internal teams. - Only minor remaining integration costs will be incurred in Q3 2026, after which all M&A transformation activity will be concluded. ### Strategic Priorities - The company will shift full focus to organic growth, operational execution, and disciplined financial performance for the remainder of 2026 and beyond, following the completion of its recent M&A period. - The company maintains a relationship-based banking model, with continued disciplined pricing and granular, conservative loan underwriting standards. - Active capital deployment: The company repurchased 750,000 outstanding shares (1% of total shares outstanding) during Q2 2026, supported by strong excess capital. - The company has built out a full statewide Florida franchise covering all major and most tertiary Florida markets, with heavy investments in talent, treasury technology, and credit capabilities to serve growing local clients. ### Credit Quality - Credit quality remains strong: Non-performing loans declined, net charge-offs stayed low at 10 basis points of average loans, and accruing past due loans improved sequentially. - The allowance for credit losses totaled 1.38% of total loans, and criticized/classified loan levels remained stable, reflecting proactive risk management.

Guidance

- Management maintained its full-year 2026 high single-digit loan growth target, with H1 2026 growth currently on track to meet this guidance. - The efficiency ratio remains on track to meet full-year guidance, driven by disciplined expense management and core revenue growth. - Management expects strong organic growth momentum to carry into 2027, after the completion of Citizens First Bank integration frees up internal resources to focus fully on new business development.

Segment performance

1. Overall lending: Total loan balances ended the quarter at $13.1 billion, growing $504 million (16% annualized) in Q2 and 8% annualized in H1 2026. The commercial loan pipeline reached $1.3 billion as of June 30, 2026. 2. Deposits: Total deposits grew $154 million (3.7% annualized) in the quarter. Non-interest-bearing demand deposits hit $4.2 billion, growing 4% annualized. The overall cost of deposits declined 1 basis point to 1.53%. 3. Net Interest Income: Net interest income totaled $182.2 million, up $4 million quarter-over-quarter (QoQ). The core net interest margin (excluding acquired loan accretion) expanded 8 basis points QoQ to 3.65%, while the GAAP net interest margin remained stable at 3.83%. 4. Non-interest Income: Non-interest income totaled $27.8 million, up 3% QoQ and 14% year-over-year (YoY) (adjusted for Q1 2026 securities portfolio repositioning losses). Wealth management contributed 42% YoY revenue growth, representing the largest share of fee-based revenue growth, while mortgage production grew with two-thirds of Q2 volume coming from the Villages market. 5. Wealth Management: Assets under management (AUM) grew 45% YoY, with $388 million in new AUM added year-to-date. Revenue has a 24% 5-year compound annual growth rate. 6. Expenses: GAAP non-interest expense totaled $123.1 million, including $8.4 million in merger and integration costs. Adjusted non-interest expense was $114.8 million, slightly higher than Q1. The adjusted efficiency ratio was 54.5%, and the GAAP efficiency ratio was 58.5%, both improving sequentially from prior quarters.

Risks & headwinds

- Industry-wide increased competition for both loans and deposits has put pressure on loan pricing and deposit costs. Competitors have begun loosening underwriting standards, including allowing lower equity contributions for commercial deals, which increases systemic industry credit risk. - Net unrealized losses in the available-for-sale (AFS) securities portfolio increased $7.5 million during the quarter due to rising market interest rates. - Post-conversion client onboarding support will continue to occupy retail and customer support team resources for an additional 6-8 weeks, temporarily limiting their focus on new growth activities during this period.

Analyst Q&A

• Q: As Seacoast recruits commercial lenders from larger institutions, will the company shift its commercial loan growth profile toward larger loans or loosen its credit box? /

  A: Seacoast is now able to pursue larger, more complex commercial clients recruited by new hires from larger super-regional banks, but remains fully disciplined on internal hold limits and concentration limits. The existing loan portfolio has deep historical granularity, so adding a small number of larger loans will not meaningfully shift the average loan size, and the company syndicates any loans that exceed internal hold limits. Larger clients also bring valuable ancillary business including operating deposits, treasury management, and wealth management opportunities.

• Q: Given the very strong 16% annualized Q2 loan growth and a robust current pipeline, is there upside to the full-year growth guidance, and what is driving the strong growth momentum? /

  A: The full-year high single-digit guidance remains unchanged, as Q1 2026 had large payoffs that left H1 growth on track to hit the full-year target. Of the 16% Q2 annualized growth, 3% came from retained residential mortgages from the Villages market (some of which will likely be sold later, moving this revenue to fee income), half of the remaining growth came from new clients brought by recently hired talent, and the remainder is driven by broad strong economic and loan demand across Florida. Seacoast's statewide Florida footprint, local brand, and invested infrastructure give it a competitive advantage driving ongoing demand.

• Q: Given increased industry deposit competition, how does Seacoast plan to drive core deposit growth and control deposit costs from here? /

  A: Seacoast has significant balance sheet flexibility from a low loan-to-deposit ratio, unlike many peers that are fully lent up and need to compete aggressively for funding. Most of the work to lower CD costs as market rates have declined is already complete. Blended new deposit costs remain in the low 2% range, and the company only needs to make tactical, not aggressive, price adjustments to grow, protecting net interest margin while expanding the deposit base. Once conversion activity concludes, 300 retail team members currently focused on integration will return to driving new deposit growth.

• Q: How competitive is the current loan market, and are competitors loosening underwriting standards? What are current new loan yields for the pipeline? /

  A: The commercial loan market is as competitive as it has ever been, with national banks that previously stepped back from commercial real estate now re-entering the market. New commercial loan yields are in the low 6% range, and retained residential mortgage yields are in the mid 6% range, both still providing reasonable returns. Management has observed competitors loosening standards by allowing lower equity contributions for deals, but Seacoast will maintain its conservative underwriting discipline and will not chase these loosened standards even if it means losing some deals, prioritizing long-term portfolio stability over near-term growth.