CoastalSouth Bancshares, Inc. Reports Earnings for Second Quarter 2025

Business Wire

19 hours ago

ATLANTA--(BUSINESS WIRE)--CoastalSouth Bancshares, Inc. ('CoastalSouth' or the 'Company') (NYSE: COSO), the holding company for Coastal States Bank (the 'Bank'), today reported net income of approximately $6.0 million, or $0.57 per diluted share, for the second quarter of 2025, compared to $5.1 million, or $0.47 per diluted share, for the first quarter of 2025, and $5.9 million, or $0.56 per diluted share, for the second quarter of 2024. For the year-to-date period ending June 30, 2025, the Company reported net income of $11.0 million, or $1.04 per diluted share, compared with $8.3 million, or $0.80 per diluted share, for the same period in 2024.
On July 3, 2025, the Company completed its initial public offering of 2,035,000 shares of common stock at a public offering price of $21.50 per share, before underwriting discounts and commissions. The Company received proceeds, net of underwriting discounts and commissions, of approximately $34.0 million in the offering related to the sale of 1,700,000 shares from the Company, and 335,000 additional shares were sold by selling shareholders. The Company's common stock began trading on the New York Stock Exchange on July 2, 2025, under the ticker symbol 'COSO'. The underwriters of the initial public offering have a 30-day option to purchase an additional 305,250 shares of common stock from selling shareholders at the initial public offering price to the public, less the underwriting discounts and commissions, from certain selling shareholders.
Commenting on the Company's results, President and Chief Executive Officer, Stephen R. Stone stated, 'The Company delivered strong financial results in the second quarter with growth in both loans held for investment and loans held for sale, continued growth in core deposits, and continued improvement to our net interest margin. With the momentum of the first six months of this year, particularly with respect to loan originations, and the addition of four new commercial bankers and two new business development officers, we are well-positioned as we head into the second half of 2025."
Second Quarter 2025 Performance Highlights:
Net income of $6.0 million or $0.57 per diluted share
Return on average assets ("ROAA") of 1.09%
Return on average equity ("ROAE") of 11.62%; Return on average tangible common equity ("ROATCE") of 11.92% 1
Net interest margin of 3.46%, an increase of 8 basis points from the first quarter
Loans held for investment ("LHFI") production of $201.1 million in commitments led to LHFI growth of $55.0 million, up 15.0% annualized from the first quarter
Book value per share growth of $0.70, or 14.2% annualized, to $20.37 at June 30, 2025; Tangible book value 1 per share growth of $0.71, or 14.9% annualized, to $19.88 at June 30, 2025 from the first quarter
Total shareholders' equity to total assets of 9.43%, compared to 9.23% at March 31, 2025; Tangible common equity 1 to tangible assets 1 of 9.22%, compared to 9.01% at March 31, 2025
Net charge-offs to average loans held for investment of 0.06%
Nonperforming assets to total assets of 0.66%; adjusted nonperforming assets to total assets 1 of 0.46%
Allowance for credit losses ("ACL") on LHFI to total LHFI of 1.15%; ACL on LHFI to nonperforming loans of 118.99%
Operating Highlights
Net interest income totaled $18.1 million for the second quarter of 2025, an increase of $1.3 million, or 7.9%, from $16.8 million for the first quarter of 2025 and an increase of $1.4 million, or 8.3% from the second quarter of 2024. The Company's net interest margin expanded to 3.46% for the second quarter of 2025, an 8 basis point increase from the first quarter of 2025 and a 3 basis point increase from the second quarter of 2024.
The yield on average interest-earning assets for the second quarter of 2025 increased to 6.08% from 6.05% for the first quarter of 2025. This increase was primarily related to a 1 basis point increase in yield on LHFI and an increased average volume of approximately $77.8 million in the LHFI portfolio quarter over quarter. Compared to the second quarter of 2024, yields on earning assets decreased 31 basis points from 6.39%. The decrease was primarily attributable to a 33 basis point decrease in LHFI and an 84 basis point decrease in the yield on the loans held for sale portfolio.
The Company's total cost of funds was 2.80% for the second quarter of 2025, a decrease of 5 basis points and 33 basis points compared with the first quarter of 2025 and second quarter of 2024, respectively Deposit costs decreased 5 basis points during the second quarter of 2025 to 2.75%, compared to 2.80% in the first quarter of 2025. The cost of interest-bearing deposits decreased 5 basis points during the second quarter of 2025 to 3.27%, compared with 3.32% in the first quarter of 2025, reflecting continued repricing of certificates of deposits in the second quarter of 2025.
Noninterest income totaled $1.8 million for the second quarter of 2025, a decrease of $86 thousand, or 4.6%, from the first quarter of 2025, primarily due to a decrease in other noninterest income, offset by a net increase in mortgage banking related income, gain on sale of government guaranteed loans ("GGL"), and other categories. Noninterest expense totaled $12.1 million for the second quarter of 2025, an increase of $673 thousand, or 5.9%, from the first quarter of 2025, primarily due to higher salaries and employee benefits and other professional fees. A number of strategic hires were made during the quarter including new commercial bankers, new GGL business development officers, and one mortgage loan officer.
The Company's effective tax rate for the second quarter of 2025 was 15.1%, compared to 23.4% for the first quarter of 2025 and 21.1% for the second quarter of 2024. The decrease in effective tax rate from the first quarter of 2025 and the second quarter of 2024 was primarily due to the recognition of renewable energy tax credits.
Balance Sheet Trends
Total assets were $2.22 billion at June 30, 2025, an increase of $122.5 million, or 5.8%, from $2.10 billion at December 31, 2024. Loans held for sale ("LHFS") were $209.1 million at June 30, 2025, an increase of $35.1 million, or 20.2%, from $174.0 million at December 31, 2024. Gross LHFI were $1.53 billion at June 30, 2025, an increase of $117.8 million, or 8.4%, from $1.41 billion at December 31, 2024.
Total deposits were $1.97 billion at June 30, 2025, an increase of $133.5 million, or 7.3%, from $1.83 billion at December 31, 2024. Noninterest-bearing deposits were $313.4 million at June 30, 2025, compared to $302.9 million at December 31, 2024. Brokered certificates of deposits, a component of time deposits, were $307.9 million at June 30, 2025, as compared to $274.9 million at December 31, 2024, an increase of $33.0 million, or 12.0%.
Credit Quality
During the second quarter of 2025, the Company recorded a provision for credit losses of $752 thousand, compared to $629 thousand and $173 thousand during the first quarter of 2025 and second quarter of 2024, respectively. The provision expense recorded during the second quarter of 2025 was primarily due to increased loan production of LHFI, changes in economic factors, and current period net charge-offs, offset by other changes in loss rates. The Company's annualized net charge-offs to average LHFI ratio was 0.06% for the second quarter of 2025 as compared to 0.00% and 0.03% during the first quarter of 2025 and second quarter of 2024, respectively.
Nonperforming assets totaled $14.7 million, or 0.66% of total assets, at June 30, 2025 compared to $15.9 million, or 0.76% of total assets at December 31, 2024. The $1.2 million decrease in nonperforming assets at June 30, 2025 from December 31, 2024 was due to the sale of other real estate owned and payments collected on nonaccrual loans during the period. Adjusted nonperforming assets 2, which excludes the guaranteed portions of nonaccrual loans, was $10.1 million, or 0.46% of total assets, at June 30, 2025 compared to $11.1 million, or 0.53% of total assets, at December 31, 2024.
About CoastalSouth Bancshares, Inc.
CoastalSouth Bancshares, Inc. is a bank holding company headquartered in Atlanta, Georgia. Through our wholly owned subsidiary, Coastal States Bank, a South Carolina state-chartered commercial bank, we offer a full range of banking products and services designed for businesses, real estate professionals, and consumers looking for a deep and meaningful relationship with their bank. To learn more about Coastal States Bank, visit www.coastalstatesbank.com.
Forward-Looking Statements
Statements in this press release regarding future events and our expectations and beliefs about our future financial performance and financial condition, as well as trends in our business and markets, constitute 'forward-looking statements' within the meaning of, and subject to the protections of, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are not historical in nature and may be identified by references to a future period or periods by the use of the words 'believe,' 'expect,' 'anticipate,' 'intend,' 'plan,' 'estimate,' 'project,' 'outlook,' or words of similar meaning, or future or conditional verbs such as 'will,' 'would,' 'should,' 'could,' or 'may.' The forward-looking statements in this press release should not be relied on because they are based on current information and on assumptions that we make about future events and circumstances that are subject to a number of known and unknown risks and uncertainties that are often difficult to predict and beyond our control. As a result of those risks and uncertainties, and other factors, our actual financial results in the future could differ, possibly materially, from those expressed in or implied by the forward-looking statements contained in this press release and could cause us to make changes to our future plans. Factors that might cause such differences include, but are not limited to: the impact of current and future economic conditions, particularly those affecting the financial services industry, including the effects of declines in the real estate market, high unemployment rates, inflationary pressures, elevated interest rates and slowdowns in economic growth, as well as the financial stress on borrowers as a result of the foregoing; potential impacts of any adverse developments in the banking industry, including any impacts on customer confidence, deposit outflows, liquidity and the regulatory response thereto; changes in the interest rate environment, including changes to the federal funds rate; changes in prices, values and sales volumes of residential and commercial real estate; competition in our markets that may result in increased funding costs or reduced earning assets yields, thus reducing margins and net interest income; interest rate fluctuations, which could have an adverse effect on the Company's profitability; a breach in security of our information systems, including the occurrence of a cyber-attack incidents or a deficiencies in cyber security; risks related to potential acquisitions; government actions, including tariffs, or trade wards (including reduced consumer spending, lower economic growth or recession, reduced demand for U.S. exports, disruptions to supply chains, and decreased demand for other banking products and services), legislation or regulatory changes which could adversely affect the ability of the consolidated Company to conduct business combinations or new operations; changes in tax laws; significant turbulence or a disruption in the capital or financial markets and the effect of a fall in stock market prices on our investment securities; the effects of war or other conflicts, domestic civil unrest and tyranny, and changes in the overall worlds geopolitical landscape; and adverse results from current or future litigation, regulatory examinations or other legal and/or regulatory actions, including as a result of the Company's participation in and execution of government programs. Therefore, the Company can give no assurance that the results contemplated in the forward-looking statements will be realized. Additional information regarding these and other risks and uncertainties to which our business and future financial performance are subject is contained in the section titled 'Cautionary Note Regarding Forward-Looking Statements' and 'Risk Factors' in the Company's final prospectus filed pursuant to Rule 424(b)(4) under the Securities Act of 1933, as amended, filed with the Securities and Exchange Commission (the 'SEC') on July 2, 2025 (Registration No. 333-287854), relating to our initial public offering, and in other documents that we file with the SEC from time to time, which are available on the SEC's website, http://www.sec.gov. In addition, our actual financial results in the future may differ from those currently expected due to additional risks and uncertainties of which we are not currently aware or which we do not currently view as, but in the future may become, material to our business or operating results. Due to these and other possible uncertainties and risks, readers are cautioned not to place undue reliance on the forward-looking statements contained in this press release or to make predictions based solely on historical financial performance. Any forward-looking statement speaks only as of the date on which it is made, and we do not undertake any obligation to update or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except as required by law. All forward-looking statements, express or implied, included in this press release are qualified in their entirety by this cautionary statement.
(dollars in thousands except
June 30,
March 31,
December 31,
September 30,
June 30,
June 30,
June 30,
per share amounts)
2025
2025
2024
2024
2024
2025
2024
Selected Operating Data:
Interest income
$
31,793
$
30,024
$
30,537
$
32,554
$
31,170
$
61,817
$
60,558
Interest expense
13,715
13,265
14,266
15,588
14,470
26,980
28,473
Net interest income
18,078
16,759
16,271
16,966
16,700
34,837
32,085
Provision (recovery) for credit losses
752
629
1,240
(1,023
)
173
1,381
336
Noninterest income (loss)
1,795
1,881
1,958
2,961
1,589
3,676
(405
)
Noninterest expense
12,092
11,419
10,335
10,830
10,652
23,511
20,903
Income tax expense
1,064
1,542
950
2,236
1,577
2,606
2,125
Net income
5,965
5,050
5,704
7,884
5,887
11,015
8,316
Adjusted net income (1)
5,965
5,050
5,704
7,884
5,887
11,015
10,970
Share and Per Share Data:
Basic earnings per share
$
0.58
$
0.49
$
0.56
$
0.77
$
0.58
$
1.07
$
0.82
Adjusted basic earnings per share (1)
$
0.58
$
0.49
$
0.56
$
0.77
$
0.57
$
1.07
$
1.08
Diluted earnings per share
$
0.57
$
0.47
$
0.54
$
0.75
$
0.56
$
1.04
$
0.80
Adjusted diluted earnings per share (1)
$
0.57
$
0.47
$
0.54
$
0.75
$
0.56
$
1.04
$
1.06
Book value per share (at period end)
$
20.37
$
19.67
$
19.01
$
18.86
$
17.58
$
20.37
$
17.58
Tangible book value per share (1)
$
19.88
$
19.17
$
18.51
$
18.35
$
17.07
$
19.88
$
17.07
Shares of common stock outstanding
10,278,921
10,274,271
10,270,146
10,250,446
10,250,446
10,278,921
10,250,446
Weighted average diluted shares outstanding
10,612,255
10,642,078
10,596,364
10,544,087
10,445,144
10,636,997
10,344,815
Selected Balance Sheet Data:
Total assets
$
2,221,245
$
2,190,391
$
2,098,712
$
2,129,346
$
2,115,547
$
2,221,245
$
2,115,547
Securities available-for-sale, at fair value (2)
331,760
325,478
335,267
355,174
339,937
331,760
339,937
Gross loans held for investment
1,527,199
1,472,232
1,409,443
1,409,913
1,442,077
1,527,199
1,442,077
Loans held for sale
209,101
187,481
174,033
193,938
154,885
209,101
154,885
Allowance for credit losses
17,497
17,104
17,118
15,615
16,002
17,497
16,002
Goodwill and other intangible assets
6,190
6,199
6,386
6,451
6,276
6,190
6,276
Deposits
1,968,301
1,937,693
1,834,802
1,807,315
1,805,590
1,968,301
1,805,590
Other borrowings
14,753
20,738
41,725
96,712
96,699
14,753
96,699
Total Shareholders' equity
209,365
202,104
195,232
193,303
180,168
209,365
180,168
(1) Considered non-GAAP financial measure - See "Non-GAAP Financial Measures' and reconciliation of GAAP to non-GAAP financial measures in tables 10A - 10H.
(2) The Company did not have securities held to maturity in any of the periods presented.
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COASTALSOUTH BANCSHARES, INC. AND SUBSIDIARY
FINANCIAL TABLES
Financial Highlights - continued (unaudited)
Table 1B
As of and for the Three Months Ended
As of and for the Six Months Ended
June 30,
March 31,
December 31,
September 30,
June 30,
June 30,
June 30,
(dollars in thousands)
2025
2025
2024
2024
2024
2025
2024
Performance Ratios:
Pre-tax pre-provision net revenue (PPNR) (1)
$
7,781
$
7,221
$
7,894
$
9,097
$
7,637
$
15,002
$
10,777
Return on average assets (ROAA) (2)
1.09
%
0.97
%
1.07
%
1.47
%
1.15
%
1.03
%
0.82
%
Adjusted return on average assets (Adj. ROAA) (1)(2)
1.09
0.97
1.07
1.47
1.15
1.03
1.08
Return on average equity (2)
11.62
10.25
11.65
16.91
13.52
10.95
9.78
Adjusted return on average equity (1)(2)
11.62
10.25
11.65
16.91
13.52
10.95
12.90
Return on average tangible common equity (ROATCE) (1)(2)
11.92
10.52
11.97
17.40
13.94
11.23
10.09
Adjusted return on average tangible common equity (Adj. ROATCE) (1)(2)
11.92
10.52
11.97
17.40
13.94
11.23
13.31
Net interest rate spread (2)
2.76
2.67
2.42
2.48
2.58
2.72
2.51
Net interest margin (2)
3.46
3.38
3.21
3.32
3.43
3.42
3.32
Efficiency ratio
60.85
61.26
56.70
54.35
58.24
61.05
65.98
Efficiency ratio, as adjusted (1)
60.85
61.26
56.70
54.35
58.24
61.05
59.48
Noninterest income to average total assets (2)
0.33
0.36
0.37
0.55
0.31
0.34
(0.04
)
Noninterest income to total revenue
9.03
10.09
10.74
14.86
8.69
9.54
(1.28
)
Adjusted noninterest income to total adjusted revenue (1)
9.03
10.09
10.74
14.86
8.69
9.54
8.71
Noninterest expense to average total assets (2)
2.21
2.19
1.94
2.02
2.07
2.20
2.05
Average interest-earning assets to average interest-bearing liabilities
126.50
126.31
127.90
127.59
128.29
126.41
127.65
Average equity to average total assets
9.37
9.46
9.20
8.70
8.48
9.41
8.34
Asset Quality Data:
Net charge-offs to average LHFI (2)
0.06
%
0.00
%
(0.02
)
%
0.02
%
0.03
%
0.03
%
0.01
%
Net charge-offs to total average loans (2)
0.05
0.00
(0.02
)
0.02
0.03
0.03
0.01
Total allowance for credit losses to total LHFI
1.15
1.16
1.21
1.11
1.11
1.15
1.11
Total allowance for credit losses to total loans
1.01
1.03
1.08
0.97
1.00
1.01
1.00
Total allowance for credit losses to nonperforming loans
118.99
117.11
114.07
184.64
182.13
118.99
182.13
Nonperforming loans to gross LHFI
0.96
0.99
1.06
0.60
0.61
0.96
0.61
Nonperforming assets to total assets
0.66
0.70
0.76
0.44
0.42
0.66
0.42
Adjusted nonperforming assets to total assets (1)
0.46
0.49
0.53
0.21
0.18
0.46
0.18
Balance Sheet and Capital Ratios:
Loan-to-deposit ratio
88.21
%
85.65
%
86.30
%
88.74
%
88.45
%
88.21
%
88.45
%
Noninterest bearing deposits to total deposits
15.92
15.52
16.51
17.28
19.10
15.92
19.10
Total shareholders' equity to total assets
9.43
9.23
9.30
9.08
8.52
9.43
8.52
Tangible common equity to tangible assets (1)
9.22
9.01
9.08
8.86
8.29
9.22
8.29
Other:
Number of branches
11
11
11
11
11
11
11
Number of full-time equivalent employees
188
180
181
181
178
183
177
(1) Considered non-GAAP financial measure - See "Non-GAAP Financial Measures' and reconciliation of GAAP to non-GAAP financial measures in tables 10A - 10H.
(2) Represents annualized data.
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COASTALSOUTH BANCSHARES, INC. AND SUBSIDIARY
FINANCIAL TABLES
Quarter End Balance Sheets (unaudited)
Table 2
June 30,
March 31,
December 31,
September 30,
June 30,
(dollars in thousands)
2025
2025
2024
2024
2024
Assets
Cash and due from banks
$
23,245
$
19,380
$
37,320
$
17,722
$
21,385
Federal funds sold
20,045
79,153
30,641
43,602
42,057
Investment securities (1)
338,601
332,312
342,750
361,935
346,687
Loans held for sale (LHFS)
209,101
187,481
174,033
193,938
154,885
Loans held for investment (LHFI)
1,527,199
1,472,232
1,409,443
1,409,913
1,442,077
Allowance for credit losses on LHFI
(17,497
)
(17,104
)
(17,118
)
(15,615
)
(16,002
)
Loans held for investment, net
1,509,702
1,455,128
1,392,325
1,394,298
1,426,075
Bank-owned life insurance
47,373
46,924
46,484
46,044
45,607
Premises, furniture and equipment, net
18,166
17,837
17,796
17,882
17,533
Deferred tax asset
17,211
17,123
18,148
16,772
18,641
Goodwill & intangible assets (2)
6,190
6,199
6,386
6,451
6,276
Other assets
31,611
28,854
32,829
30,702
36,401
Total assets
$
2,221,245
$
2,190,391
$
2,098,712
$
2,129,346
$
2,115,547
Liabilities and stockholders' equity
Liabilities
Deposits
Noninterest bearing DDA
$
313,386
$
300,678
$
302,907
$
312,290
$
344,860
Interest bearing DDA
209,816
191,452
181,068
183,707
179,557
Savings and money market
628,729
650,050
591,626
654,192
658,542
Certificates of deposit
816,370
795,513
759,201
657,126
622,631
Total deposits
1,968,301
1,937,693
1,834,802
1,807,315
1,805,590
Federal Home Loan Bank of Atlanta advances
-
-
15,000
-
-
Subordinated debt, net
14,753
14,741
14,730
14,718
14,706
Revolving commercial line of credit, net
-
5,997
11,995
11,994
11,993
Federal Reserve Bank - Bank Term Funding Program ("BTFP") advances
-
-
-
70,000
70,000
Other liabilities
28,826
29,856
26,953
32,016
33,090
Total liabilities
2,011,880
1,988,287
1,903,480
1,936,043
1,935,379
Stockholders' equity
Voting common stock
8,107
8,102
8,098
8,078
8,078
Nonvoting common stock
2,172
2,172
2,172
2,172
2,172
Capital surplus
159,267
158,997
158,755
158,463
158,125
Accumulated income
53,009
47,044
41,994
36,290
28,406
Accumulated other comprehensive loss
(13,190
)
(14,211
)
(15,787
)
(11,700
)
(16,613
)
Total stockholders' equity
209,365
202,104
195,232
193,303
180,168
Total liabilities and stockholders' equity
$
2,221,245
$
2,190,391
$
2,098,712
$
2,129,346
$
2,115,547
(1) No ACL was recognized for the periods presented.
(2) Includes commercial mortgage servicing assets of $1.1 million, $1.1 million, $1.2 million, $1.3 million, and $1.0 million for June 30, 2025, March 31, 2025, December 31, 2024, September 30, 2024 and June 30, 2024, respectively.
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COASTALSOUTH BANCSHARES, INC. AND SUBSIDIARY
FINANCIAL TABLES
Statements of Operations (unaudited)
Table 3
Three Months Ended
Six Months Ended
June 30,
March 31,
December 31,
September 30,
June 30,
June 30,
June 30,
(dollars in thousands)
2025
2025
2024
2024
2024
2025
2024
Interest income
Interest on cash and due from banks
$
111
$
135
$
122
$
131
$
140
$
246
$
281
Interest on federal funds sold
698
963
870
1,045
842
1,661
1,836
Interest and dividends on investment securities
3,875
3,800
3,994
4,171
4,220
7,675
7,881
Interest and fees on LHFS
3,296
2,819
3,404
2,993
2,335
6,115
3,875
Interest and fees on LHFI
23,813
22,307
22,147
24,214
23,633
46,120
46,685
Total interest income
31,793
30,024
30,537
32,554
31,170
61,817
60,558
Interest expense
Deposits
13,251
12,830
13,498
14,230
13,122
26,081
25,715
Other borrowings
464
435
768
1,358
1,348
899
2,758
Total interest expense
13,715
13,265
14,266
15,588
14,470
26,980
28,473
Net interest income
18,078
16,759
16,271
16,966
16,700
34,837
32,085
Provision (recovery) for credit losses
752
629
1,240
(1,023
)
173
1,381
336
Noninterest income
Mortgage banking related income
326
221
391
276
299
547
537
Interchange and card fee Income
257
266
210
216
226
523
442
Service charges on deposit accounts
215
211
230
207
198
426
409
Bank-owned life insurance
449
440
440
437
491
889
787
Gain on sale of government guaranteed loans
265
-
151
1,312
35
265
355
Losses on sale of available-for-sale securities
-
-
-
-
-
-
(3,465
)
Other noninterest income
283
743
536
513
340
1,026
530
Total noninterest income (loss)
1,795
1,881
1,958
2,961
1,589
3,676
(405
)
Noninterest expense
Salaries and employee benefits
6,997
6,694
6,759
6,727
6,654
13,691
12,701
Occupancy and equipment
814
788
762
754
736
1,602
1,479
Data processing
653
624
605
548
534
1,277
1,060
Other professional fees
973
693
496
358
501
1,666
1,192
Software and other technology expense
719
703
774
671
631
1,422
1,297
Regulatory assessment
344
361
336
344
318
705
611
Other noninterest expense
1,592
1,556
603
1,428
1,278
3,148
2,563
Total noninterest expense
12,092
11,419
10,335
10,830
10,652
23,511
20,903
Net income before taxes
7,029
6,592
6,654
10,120
7,464
13,621
10,441
Expand
COASTALSOUTH BANCSHARES, INC. AND SUBSIDIARY
FINANCIAL TABLES
Three Months Ended
March 31, 2025
June 30, 2024
(dollars in thousands)
Balance
Interest
Rate
Balance
Interest
Rate
Balance
Interest
Rate
Earning assets:
Cash and due from banks
$
20,762
$
111
2.14
%
$
22,725
$
135
2.41
%
$
20,839
$
140
2.70
%
Federal funds sold
62,656
698
4.47
%
88,478
963
4.41
%
60,964
842
5.55
%
Investment securities
338,635
3,875
4.59
%
335,254
3,800
4.60
%
347,194
4,220
4.89
%
Loans held for sale
167,617
3,296
7.89
%
136,849
2,819
8.35
%
107,604
2,335
8.73
%
Loans held for investment
1,506,211
23,813
6.34
%
1,428,405
22,307
6.33
%
1,424,411
23,633
6.67
%
Total earning assets
2,095,881
31,793
6.08
%
2,011,711
30,024
6.05
%
1,961,012
31,170
6.39
%
Noninterest-earning assets:
Allowance for credit losses on LHFI
(17,110
)
(17,116
)
(16,163
)
Bank-owned life insurance
47,119
46,672
45,360
Premises, furniture and equipment, net
18,034
17,851
17,634
Deferred tax asset
17,182
17,803
19,321
Goodwill & intangible assets
6,168
6,328
6,355
Other assets
29,442
27,947
31,983
Total noninterest-earning assets
100,835
99,485
104,490
Total assets
$
2,196,716
$
2,111,196
$
2,065,502
Interest-bearing liabilities:
Interest-bearing deposits
$
1,626,415
$
13,251
3.27
%
$
1,566,856
$
12,830
3.32
%
$
1,431,853
$
13,122
3.69
%
Federal Reserve Bank - BTFP
-
-
0.00
%
-
-
0.00
%
70,000
854
4.91
%
Federal funds purchased
38
1
10.56
%
-
-
0.00
%
-
-
0.00
%
Federal Home Loan Bank of Atlanta advances
10,000
116
4.65
%
1,166
13
4.52
%
-
-
0.00
%
Revolving commercial line of credit, net
5,667
112
7.93
%
9,863
187
7.69
%
11,992
259
8.69
%
Subordinated debt, net
14,747
235
6.39
%
14,735
235
6.47
%
14,700
235
6.43
%
Total interest-bearing liabilities
1,656,867
13,715
3.32
%
1,592,620
13,265
3.38
%
1,528,545
14,470
3.81
%
Noninterest-bearing liabilities:
Noninterest-bearing deposits
306,330
293,387
333,001
Other liabilities
27,682
25,426
28,825
Total noninterest-bearing liabilities
334,012
318,813
361,826
Stockholders' equity
205,837
199,763
175,131
Total liabilities and stockholders' equity
$
2,196,716
$
2,111,196
$
2,065,502
Net interest income
$
18,078
$
16,759
$
16,700
Net interest spread
2.76
%
2.67
%
2.58
%
Net interest margin
3.46
%
3.38
%
3.43
%
Cost of total deposits (1)
2.75
%
2.80
%
2.99
%
Cost of total funding (1)
2.80
%
2.85
%
3.13
%
(1) Includes noninterest bearing deposits.
Expand
COASTALSOUTH BANCSHARES, INC. AND SUBSIDIARY
FINANCIAL TABLES
Six Months Ended
June 30, 2025
June 30, 2024
Earning assets:
Cash and due from banks
$
21,738
$
246
2.28
%
$
20,987
$
281
2.69
%
Federal funds sold
75,496
1,661
4.44
%
65,259
1,836
5.66
%
Investment securities
336,954
7,675
4.59
%
350,865
7,881
4.52
%
Loans held for sale
152,318
6,115
8.10
%
89,422
3,875
8.71
%
Loans held for investment
1,467,523
46,120
6.34
%
1,416,431
46,685
6.63
%
Total earning assets
2,054,029
61,817
6.07
%
1,942,964
60,558
6.27
%
Noninterest-earning assets:
Allowance for credit losses on LHFI
(17,113
)
(15,908
)
Bank-owned life insurance
46,897
45,168
Premises, furniture and equipment, net
17,943
17,647
Deferred tax asset
17,491
20,235
Goodwill & intangible assets
6,248
6,400
Other assets
29,582
33,677
Total noninterest-earning assets
101,048
107,219
Total assets
$
2,155,077
$
2,050,183
Interest-bearing liabilities:
Interest-bearing deposits
$
1,596,799
$
26,081
3.29
%
$
1,424,505
$
25,715
3.63
%
Federal Reserve Bank - BTFP
-
-
0.00
%
66,539
1,622
4.90
%
Federal funds purchased
19
1
10.61
%
-
-
0.00
%
Federal Home Loan Bank of Atlanta advances
5,607
128
4.60
%
2,747
77
5.64
%
Revolving commercial line of credit, net
7,754
300
7.80
%
13,574
589
8.73
%
Subordinated debt, net
14,741
470
6.43
%
14,694
470
6.43
%
Total interest-bearing liabilities
1,624,920
26,980
3.35
%
1,522,059
28,473
3.76
%
Noninterest-bearing liabilities:
Noninterest bearing deposits
299,895
327,210
Other liabilities
27,445
29,841
Total noninterest-bearing liabilities
327,340
357,051
Stockholders' equity
202,817
171,073
Total liabilities and stockholders' equity
$
2,155,077
$
2,050,183
Net interest income
$
34,837
$
32,085
Net interest spread
2.72
%
2.51
%
Net interest margin
3.42
%
3.32
%
Cost of total deposits (1)
2.77
%
2.95
%
Cost of total funding (1)
2.83
%
3.10
%
(1) Includes noninterest bearing deposits.
Expand
COASTALSOUTH BANCSHARES, INC. AND SUBSIDIARY
FINANCIAL TABLES
Loan Data (unaudited)
Table 6
As of the Quarter Ended
June 30, 2025
March 31, 2025
December 31, 2024
September 30, 2024
June 30, 2024
Loans held for investment ("LHFI"):
Commercial Loans
Acquisition, development and construction
$
100,528
6.6
%
$
76,453
5.2
%
$
72,520
5.2
%
$
112,275
8.0
%
$
109,855
7.6
%
Income producing CRE
372,142
24.4
352,693
24.0
321,558
22.8
267,551
19.0
272,397
18.9
Owner-occupied CRE
91,147
6.0
90,204
6.1
94,573
6.7
95,789
6.8
100,272
7.0
Senior housing
236,474
15.5
245,292
16.7
234,081
16.6
231,260
16.4
245,591
17.0
Commercial and industrial
131,716
8.6
145,784
9.8
141,626
10.0
140,290
10.0
137,571
9.5
Retail Loans
Marine vessels
301,327
19.7
284,305
19.3
263,657
18.6
279,689
19.8
288,949
20.0
Residential mortgages
185,527
12.1
176,794
12.0
174,099
12.4
173,392
12.3
172,505
12.0
Cash value life insurance LOC
87,135
5.7
80,503
5.5
86,844
6.2
87,968
6.2
93,657
6.5
Other consumer
21,203
1.4
20,204
1.4
20,485
1.5
21,699
1.5
21,280
1.5
Gross loans held for investment
$
1,527,199
100.0
%
$
1,472,232
100.0
%
$
1,409,443
100.0
%
$
1,409,913
100.0
%
$
1,442,077
100.0
%
Core LHFI
1,464,200
1,406,199
1,342,073
1,341,135
1,369,629
Acquired LHFI (1)
62,999
66,033
67,370
68,778
72,448
Gross loans held for investment
$
1,527,199
$
1,472,232
$
1,409,443
$
1,409,913
$
1,442,077
Allowance for credit losses on LHFI
17,497
17,104
17,118
15,615
16,002
Net loans held for investment
$
1,509,702
$
1,455,128
$
1,392,325
$
1,394,298
$
1,426,075
Total loans held-for-sale
209,101
187,481
174,033
193,938
154,885
Total Loans
$
1,736,300
$
1,659,713
$
1,583,476
$
1,603,851
$
1,596,962
(1) Includes loans acquired through business combinations.
Expand
Nonperforming Assets (unaudited)
Table 7
As of the Quarter Ended
(dollars in thousands)
June 30, 2025
March 31, 2025
December 31, 2024
September 30, 2024
June 30, 2024
Nonaccrual loans
$
14,611
$
14,599
$
14,957
$
8,408
$
8,739
Past due loans 90 days and still accruing
93
6
49
49
47
Total nonperforming loans
$
14,704
$
14,605
$
15,006
$
8,457
$
8,786
Other real estate owned
-
765
864
864
-
Total nonperforming assets
$
14,704
$
15,370
$
15,870
$
9,321
$
8,786
Nonperforming loans to gross LHFI
0.96
%
0.99
%
1.06
%
0.60
%
0.61
%
Nonaccrual loans to total assets
0.66
%
0.67
%
0.71
%
0.39
%
0.41
%
Nonperforming assets to total assets
0.66
%
0.70
%
0.76
%
0.44
%
0.42
%
Expand
COASTALSOUTH BANCSHARES, INC. AND SUBSIDIARY
FINANCIAL TABLES
Allowance for Credit Losses (unaudited)
Table 8
As of and for the Three Months Ended
As of and for the Six Months Ended
June 30,
March 31,
December 31,
September 30,
June 30,
June 30,
June 30,
(dollars in thousands)
2025
2025
2024
2024
2024
2025
2024
Allowance for credit losses on LHFI
Balance, beginning of period
$
17,104
$
17,118
$
15,615
$
16,002
$
15,774
$
17,118
$
15,465
Net charge-offs/(recoveries):
Commercial Loans
Acquisition, development and construction
-
-
-
-
-
-
-
Income producing CRE
-
-
-
-
-
-
-
Owner-occupied CRE
-
-
(53
)
-
-
-
-
Senior housing
-
-
-
-
-
-
-
Commercial and industrial
19
1
3
30
54
20
49
Retail Loans
Marine vessels
-
-
-
36
-
-
-
Residential mortgages
(3
)
(2
)
(2
)
(7
)
(3
)
(5
)
(6
)
Cash value life insurance LOC
-
-
-
-
47
-
47
Other consumer
192
16
(25
)
27
(2
)
208
(3
)
Total net charge-offs/(recoveries)
$
208
$
15
$
(77
)
$
86
$
96
$
223
$
87
Provision (recovery) for loan credit losses
601
1
1,426
(301
)
324
602
624
Balance, ending of period
$
17,497
$
17,104
$
17,118
$
15,615
$
16,002
$
17,497
$
16,002
Allowance for credit losses for unfunded commitments
Period beginning balance
$
3,348
$
2,720
$
2,906
$
3,628
$
3,779
$
2,720
$
3,916
Provision (recapture) for credit losses
151
628
(186
)
(722
)
(151
)
779
(288
)
Period ending balance
$
3,499
$
3,348
$
2,720
$
2,906
$
3,628
$
3,499
$
3,628
Balance, end of period - Allowance for credit losses: LHFI and unfunded commitments
$
20,996
$
20,452
$
19,838
$
18,521
$
19,630
$
20,996
$
19,630
Total loans held for investment
$
1,527,199
$
1,472,232
$
1,409,443
$
1,409,913
$
1,442,077
$
1,527,199
$
1,442,077
Credit Analysis
Net charge-offs to average LHFI
0.06
%
0.00
%
(0.02
)%
0.02
%
0.03
%
0.03
%
0.01
%
Total allowance for credit losses on LHFI to total LHFI
1.15
%
1.16
%
1.21
%
1.11
%
1.11
%
1.15
%
1.11
%
Total allowance for credit losses on LHFI to nonaccrual loans
119.75
%
117.16
%
114.45
%
185.72
%
183.11
%
119.75
%
183.11
%
Total allowance for credit losses on LHFI to total nonperforming loans
118.99
%
117.11
%
114.07
%
184.64
%
182.13
%
118.99
%
182.13
%
Expand
COASTALSOUTH BANCSHARES, INC. AND SUBSIDIARY
FINANCIAL TABLES
Loan Risk Ratings (1) (2) (unaudited)
Table 9
As of the Quarter Ended
(dollars in thousands)
June 30, 2025
March 31, 2025
December 31, 2024
September 30, 2024
June 30, 2024
Acquisition, development and construction (1)
Pass
$
100,528
$
76,453
$
72,520
$
112,275
$
109,855
Special mention
-
-
-
-
-
Substandard
-
-
-
-
-
Total acquisition, development and construction
$
100,528
$
76,453
$
72,520
$
112,275
$
109,855
Income producing CRE (1)
Pass
$
371,255
$
352,281
$
321,146
$
262,287
$
267,107
Special mention
-
-
-
4,852
4,878
Substandard
887
412
412
412
412
Total income producing
$
372,142
$
352,693
$
321,558
$
267,551
$
272,397
Owner-occupied CRE (1)