Seacoast Q3 2026 Profit Rises 64% as Loan Growth Reaches 13%

Seacoast Banking Corporation of Florida reported a 64% year-over-year increase in third-quarter net income, supported by higher net interest income and broad-based loan growth, while merger-related costs lifted expenses and unrealized securities losses reduced tangible book value. The bank also set a 2026 adjusted diluted earnings outlook of $2.48 to $2.52 per share.

The Florida-based lender, which trades under the ticker SBCF, recorded net income of $59.9 million, or $0.55 per diluted share, for the third quarter of 2026. Net income increased 1% from the previous quarter and 64% from a year earlier. Adjusted net income, a non-GAAP measure, rose 9% sequentially and 59% year over year to $71.8 million, or $0.66 per diluted share.

Adjusted pre-tax, pre-provision earnings increased 5% from the second quarter and 49% from the prior-year period. Adjusted return on average assets was 1.34%, up from 1.25% in the preceding quarter, while adjusted return on average tangible shareholders’ equity reached 16.89%, compared with 15.79%.

Loan growth supports interest income

Net interest income on a fully taxable-equivalent basis increased 2% from the prior quarter and 37% year over year to $185.4 million. The net interest margin held at 3.83%. Excluding accretion on acquired loans, the margin widened by one basis point sequentially to 3.66%.

Loan yields increased one basis point to 5.89%, or three basis points to 5.64% excluding acquired-loan accretion. Securities yields rose five basis points to 4.52%. Those gains were accompanied by higher funding costs: the cost of deposits increased seven basis points to 1.60%, and the total cost of funds rose five basis points to 1.74%.

Loans outstanding increased by $429 million during the quarter to $13.57 billion, representing 13% annualized organic growth. Organic loan growth was 10% annualized for the first nine months of 2026, and the commercial loan pipeline stood at approximately $1.3 billion at quarter-end.

Seacoast said growth was broad-based across its portfolio. Residential loans represented 24% of total loans, commercial and financial loans 19%, and owner-occupied commercial real estate 16%. Regulatory commercial real estate exposure equaled an estimated 227% of total consolidated risk-based capital, while construction and land development loans represented 41%.

Fee income increases as merger costs weigh on expenses

Noninterest income rose 14% from the second quarter to $31.6 million. Adjusted noninterest income increased 15% to $32.1 million.

Mortgage banking income climbed 73% sequentially to $4.7 million as higher interest rates increased the value of mortgage servicing rights, offsetting declines recognized earlier in 2026. Insurance agency income rose 38% to $1.8 million, reflecting business growth and a small agency acquisition completed during the quarter. Other income increased 24% to $7.5 million, primarily due to higher swap and syndication fees, gains on Small Business Administration loan sales and unrealized gains on small-business investment company holdings.

Wealth management income increased 2% to $6.1 million. Assets under management reached $3.2 billion at September 30, up 29% year over year, including $574 million of new organic assets added during the first nine months of 2026.

Noninterest expense rose 8% sequentially and 31% year over year to $133.3 million. Merger and integration costs totaled $15.5 million, compared with $8.4 million in the second quarter and $10.8 million a year earlier. Adjusted noninterest expense was $117.8 million, while the adjusted efficiency ratio improved to 53.87% from 54.54% in the prior quarter.

Deposits decline, credit measures remain stable

Deposits totaled $16.58 billion at quarter-end, down from $16.79 billion at June 30. The decrease included a $159 million reduction in brokered deposits and a $105.9 million decline in public funds. Excluding those sources, deposits grew at a 1.3% annualized rate across the remaining categories. Noninterest-bearing demand deposits grew at a 10% annualized pace during the first nine months of the year.

Nonperforming loans declined to 0.54% of total loans from 0.66% in the second quarter. Net charge-offs increased to an annualized 0.16% of average loans from 0.10%, while criticized and classified loans edged up to 2.90% of total loans from 2.88%.

The allowance for credit losses was $191 million, or 1.41% of total loans. That balance included an $8.4 million measurement-period adjustment to the reserve for an acquired Villages Bancorporation loan. Seacoast also had $121 million of remaining unrecognized discounts on acquired loans, equal to 0.89% of total loans.

Securities marks reduce tangible book value

Seacoast sold $234 million of securities during the quarter to fund loan growth. At the same time, net unrealized losses in its available-for-sale portfolio increased by $237 million because of higher rates and wider spreads.

Tangible book value per share, treating convertible preferred shares as common, fell to $15.96 from $17.25 at the end of the second quarter. Changes in accumulated other comprehensive income associated with securities and related hedges accounted for approximately $1.63 per share of the decline. The company said more than 80% of the available-for-sale portfolio was agency-guaranteed and that it did not expect a realized loss on the longer-duration holdings affected by the market moves.

The estimated Tier 1 capital ratio was 14.1%, and the loan-to-deposit ratio was 82%. Seacoast repurchased more than 1.2 million common shares during the first nine months of 2026.

2026 outlook

For full-year 2026, management expects adjusted revenue on a fully taxable-equivalent basis to grow 28% to 31% from the $656 million reported for 2025. The company projects an adjusted efficiency ratio of 53% to 55% and adjusted diluted earnings of $2.48 to $2.52 per share.

Seacoast expects high-single-digit organic loan growth and low- to mid-single-digit organic deposit growth for the year. For the fourth quarter, it projects adjusted return on assets of 1.30% and adjusted return on tangible equity of 16.0%.

The outlook remains subject to risks including changes in interest rates and deposit costs, economic conditions, borrower credit performance, Seacoast’s Florida commercial real estate exposure, acquisition integration, securities valuation changes, competition for customers and funding, cybersecurity threats, and regulatory developments.