Coastal Carolina Bancshares, Inc. Announces Second Quarter Results
2025 Second Quarter Financial Highlights
• Quarterly net income of $2.5 million, an increase of 6% over the most recent linked quarter and 29% over the second quarter of 2024
• Quarterly Return on Average Equity of 12.63%
• Net Interest Margin expansion to 3.59% for the quarter ended June 30, 2025 compared to 3.55% and 3.19% for the prior quarters ended March 31, 2025 and June 30, 2024, respectively
• Increased book value per share and tangible book value per share to $12.80 and $12.31 at June 30, 2025 from $12.07 and $11.56 at December 31, 2024
• Quarterly deposit growth of $78 million or 7% (29% annualized) from $1,002 million at March 31, 2025 to $1,080 million at June 30, 2025
• Quarterly loan growth of $17 million or 2% (8% annualized) from $863 million at March 31, 2025 to $880 million at June 30, 2025
• Key credit quality metrics remained pristine with a non-performing assets ratio of 0.0% and no past due loans greater than 30 days
Capital
At June 30, 2025, the Bank's regulatory capital ratios (Leverage, Tier 1, and Total Risk-Based) were 9.09%, 11.76%, and 12.87%, respectively. Each of these ratios exceed the regulatory minimums to be considered well capitalized.
The Company reported book value per share and tangible book value per share at June 30, 2025 of $12.80 and $12.31, respectively, compared to $12.57 and $12.07 at March 31, 2025. Increased book value per share during the quarter resulted from retained earnings accumulation and changes in investment market valuations during the quarter.
Balance Sheet and Credit Quality
Total Assets increased by 7% during the quarter and 9% during the first six months of the year to $1,187 million at June 30, 2025. Asset growth was driven by significant deposit growth during the quarter resulting in increased cash and cash equivalents and increased loan balances.
The Company experienced considerable deposit growth during the quarter reporting $1,080 million in total deposits at June 30, 2025, compared to $1,002 million at March 31, 2025, an increase of $78 million or 8%. At quarter end, checking and savings accounts represented 35% of the Bank's total deposit balances while money market accounts and time deposits represented 48% and 17% of total deposits, respectively. In addition to core deposit growth, the Bank's brokered CD balances increased during the quarter from $17 million at March 31, 2025 to $25 million at June 30, 2025.
President and CEO of the Company and Bank, Laurence S. Bolchoz, Jr., commented, 'The Bank's deposit growth was remarkable during the second quarter with $78 million in deposit growth. While seasonal deposit fluctuations contributed to deposit growth during the quarter, this growth reflects the hard work of our team and the daily focus we place on core deposit acquisition and retention'.
Net loans increased $17 million or 2% during the second quarter, and $43 million or 5% year-to-date to $880 million at June 30, 2025. Year to data loan growth was concentrated in owner occupied CRE, non-owner occupied CRE, 1-4 family residential, and C&I lending which accounted for $13 million, $10 million, $7 million and $7 million in net growth, respectively. This growth was partially offset by a reduction in construction and land development lending of $7 million.
The Company continues to report excellent asset quality metrics with no loans classified as nonaccrual, no loans past due greater than 30 days, and a non-performing asset ratio of 0.00%. There were no charge-offs during the quarter, and no outstanding OREO property at June 30, 2025.
Mr. Bolchoz commented, 'The Bank continues to report exceptional credit quality metrics with no past dues, no non-accrual loans, and no OREO properties at quarter end. This is a significant accomplishment and a testament to the health of our local economies and our team's emphasis on credit quality'.
Income Statement
Net Interest Income
Net interest income increased $0.4 million or 4% to $9.3 million for the quarter ended June 30, 2025, compared to $8.9 million during the most recent linked quarter, and increased 24% when compared to prior year's second quarter net interest income of $7.5 million. The Bank's net interest margin was 3.59% for the quarter ended June 30, 2025, compared to 3.55% for the prior quarter ended March 31, 2025 and 3.19% during the second quarter of 2024.
Net interest margin expansion during the second quarter of 2025 was driven by loan growth and increased loan yields partially offset by a slight increase in the Bank's cost of funds. The Bank's yield on earning assets increased to 5.63% for the quarter ended June 30, 2025 compared to 5.54% during the most recent linked quarter, and 5.44% in the second quarter of 2024. The Bank's loan yields increased when compared to the prior quarter from 5.98% to 6.07%, while the Bank's cost of funds increased quarter over quarter from 2.14% to 2.19%.
Mr. Bolchoz said, 'We are very pleased with the Bank's earnings for the second quarter of 2025 with net income increasing 6% over the most recent linked quarter and 29% when compared to the second quarter of last year. Net income improvement was driven by efficient growth and an expanding net interest margin.'
Noninterest Income
Noninterest income totaled $602 thousand for the quarter ended June 30, 2025, compared to $610 thousand earned during the most recent quarter ended March 31, 2025 and $558 thousand in the second quarter of 2024. Non-interest income was relatively flat quarter over quarter and consisted primarily of service charges and fees on deposit accounts, interchange and merchant fee income, mortgage sales income, and earnings from bank owned life insurance.
Noninterest Expense
Noninterest expense totaled $6.3 million for the quarter ended June 30, 2025, compared to $6.2 million for the prior quarter ended March 31, 2025, and $5.5 million for the comparative quarter ended June 30, 2024. Non-interest income remained relatively flat in comparison to the prior quarter with minor increases in compensation and benefits offset by reduced data processing costs.
Provision for Loan Losses
During the quarter the Bank recorded a provision of $480 thousand for changes in CECL allowance for credit losses. At quarter end the Bank's allowance for credit losses on loans increased to $9.3 million and the reserve on unfunded commitments increased to $470 thousand. The cumulative CECL reserve of $9.8 million was 1.11% of total loans outstanding at June 30, 2025.
About Coastal Carolina Bancshares, Inc.
Coastal Carolina Bancshares, Inc. is the Bank holding Company of Coastal Carolina National Bank, a Myrtle Beach-based community bank serving Horry, Georgetown, Aiken, Orangeburg, Richland, Greenville, Spartanburg, and Brunswick (NC) counties. Coastal Carolina National Bank is a locally operated financial institution focused on providing personalized service. It offers a full range of banking services designed to meet the specific needs of individuals and small and medium-sized businesses. Headquartered in Myrtle Beach, SC, the Bank also has branches in Garden City, North Myrtle Beach, Conway, Aiken, Orangeburg, Columbia, Greenville, and Spartanburg, South Carolina, and Ocean Isle Beach, North Carolina. Through the substantial experience of our local management and Board of Directors, Coastal Carolina Bancshares, Inc. seeks to enhance value for our shareholders, build lasting customer relationships, benefit our communities and give our employees a meaningful career opportunity. To learn more about the Company and its subsidiary bank, please visit our website at www.myccnb.com.
Forward-Looking Statements
Except for historical information, all of the statements, expectations, and assumptions contained in this press release are forward-looking statements. Actual results might differ materially from those explicit or implicit in the forward-looking statements. Important factors that could cause actual results to differ materially include, without limitation: the effects of future economic conditions; governmental fiscal and monetary policies; legislative and regulatory changes; the risks of changes in interest rates; successful merger integration; management of growth; fluctuations in our financial results; reliance on key personnel; our ability to compete effectively; privacy, security and other risks associated with our business. Coastal Carolina Bancshares, Inc. assumes no obligation and does not intend to update these forward-looking statements, except as required by law.
# # #
Contact:
Russell Vedder
Title: EVP/CFO
Phone: (843) 839-5662
Fax: (843) 839-5699
SOURCE: Coastal Carolina Bancshares, Inc.
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