SEC Filing | Southern States Bancshares, Inc

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ssbk-20231023

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

___________________________

FORM 8-K

___________________________

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): October 23, 2023

___________________________

Southern States Bancshares, Inc.

(Exact Name of Registrant as Specified in its Charter)

___________________________


Alabama	001-40727	26-2518085
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)
615 Quintard Ave.
Anniston, AL		36201
(Address of Principal Executive Offices)		(Zip Code)

Registrant’s telephone number, including area code: (256) 241-1092

Securities registered pursuant to Section 12(b) of the Act:

___________________________


Title of each class	Trading Symbols(s)	Name of exchange on which registered
Common Stock, $5.00 par value	SSBK	The NASDAQ Stock Market LLC

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e 4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

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. ☐

Item. 2.02 Results of Operations and Financial Condition.

On October 23, 2023, Southern States Bancshares, Inc. (the “Company”) issued a press release announcing its financial results for the third quarter ended September 30, 2023 (the “Earnings Release”). A copy of the Earnings Release is furnished as Exhibit 99.1 to this Current Report on Form 8-K (this “Report”).

The information set forth under Item 7.01 is also furnished pursuant to this Item 2.02

Item 7.01 Regulation FD Disclosure.

The Company has prepared a presentation of its results for the third quarter ended September 30, 2023 (the “Presentation”) to be used from time to time during meetings with members of the investment community. A copy of the Presentation is furnished as Exhibit 99.2 to this Report. The Presentation will also be made available on the Company’s investor relations website at ir.southernstatesbank.net under the Presentations section.

The information contained in Items 2.02 and 7.01, including Exhibits 99.1 and 99.2 furnished herewith, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities under that section, nor shall it be deemed incorporated by reference into any registration statement or other documents pursuant to the Securities Act of 1933, as amended, or into any filing or other document pursuant to the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

Item 9.01. Financial Statements and Exhibits.

(d)Exhibits


Exhibit No.						Description
99.1						Earnings Release issued October 23 , 2023 for the Third Quarter Ended September 30, 2023.
99.2						Southern States Bancshares, Inc. Presentation of Results for the Third Quarter Ended September 30, 2023.
104						Cover Page Interactive Data File (embedded within the Inline XBRL document)

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 hereunto duly authorized.


Dated: October 24, 2023	SOUTHERN STATES BANCSHARES, INC.

	By:	/s/ Lynn Joyce
	Name:	Lynn Joyce
	Title:	Senior Executive Vice President and Chief Financial Officer

Document

https://cdn.kscope.io/f09587615bb3993f2019ced1b61f3694-ssb_symbol1.jpg


SOUTHERN STATES BANCSHARES, INC.			615 Quintard Avenue / Anniston, AL 36201 / (256) 241-1092

Southern States Bancshares, Inc. Announces Third Quarter 2023 Financial Results

Third Quarter 2023 Performance and Operational Highlights

•Core net income(1) of $9.6 million, or $1.06 per diluted share(1)

•Net income of $6.6 million, or $0.73 per diluted share

•Net interest income of $20.7 million, an increase of $1.3 million from the prior quarter

•Net interest margin (“NIM”) of 3.78%, up 5 basis points from the prior quarter

•NIM of 3.79% on a fully-taxable equivalent basis (“NIM - FTE”)(1)

•Return on average assets (“ROAA”) of 1.15%; return on average stockholders’ equity (“ROAE”) of 12.96%; and return on average tangible common equity (“ROATCE”)(1) of 14.21%

•Core ROAA(1) of 1.66%; and core ROATCE(1) of 20.50%

•Efficiency ratio of 48.01%; and core efficiency ratio of 42.79%

•Linked-quarter loan growth was 13.3% annualized

•Linked-quarter total deposits declined 1.5% annualized, primarily due to a reduction in brokered deposits

•Linked-quarter total deposits, excluding brokered deposits, increased 4.2% annualized from the prior quarter

(1) See "Reconciliation of Non-GAAP Financial Measures" below for reconciliation of non-GAAP financial measures to their most closely comparable GAAP financial measures.

ANNISTON, Ala., October 23, 2023 – Southern States Bancshares, Inc. (NASDAQ: SSBK) (“Southern States” or the “Company”), the holding company for Southern States Bank, an Alabama state-chartered commercial bank (the “Bank”), today reported net income of $6.6 million, or $0.73 diluted earnings per share, for the third quarter of 2023. This compares to net income of $8.8 million, or $0.98 diluted earnings per share, for the second quarter of 2023, and net income of $6.7 million, or $0.75 diluted earnings per share, for the third quarter of 2022. The Company reported core net income of $9.6 million, or $1.06 diluted core earnings per share, for the third quarter of 2023. This compares to core net income of $7.1 million, or $0.79 diluted core earnings per share, for the second quarter of 2023, and core net income of $6.8 million, or $0.77 diluted core earnings per share, for the third quarter of 2022 (see “Reconciliation of Non-GAAP Financial Measures”).

CEO Commentary

Mark Chambers, Chief Executive Officer and President of Southern States, said, “Our business development teams continued to identify compelling opportunities in the third quarter, driving annualized sequential loan growth of 13.3% and maintaining the strong momentum we’ve generated over the past two years as we meet steady loan demand across our economically dynamic footprint.”

“Our growth positioned the bank to capitalize on higher rates, with increased yields on earning assets driving a nearly 7% gain in net interest income from the second quarter and from a year earlier, bolstering our core earnings. As we pursue new business, we remain committed to diligent underwriting and robust credit quality. Our non-performing loans as a percentage of the overall loan portfolio totaled just 0.06%, consistent with the prior quarter.”

“Importantly, we continue to fund our loan growth with a healthy deposit franchise. Our funding costs did increase during the third quarter to remain competitive in terms of price amid higher rates to keep our total deposit levels relatively stable. However, this was more than offset by our loan growth and gains in yields, and our net interest margin expanded by 5 basis points in the quarter as a result.”

During the second quarter of 2023, the Company received a $5.1 million employee retention credit (“ERC”). The second quarter of 2023 included the $5.1 million ERC in noninterest income, and also included $1.2 million in noninterest expense for professional fees paid by the Company in obtaining the ERC. After reviewing the revised IRS guidelines pertaining to ERC issued during the third quarter, the Company determined to return the full $5.1 million ERC to the IRS and has recorded a payable. The Company will also receive a refund of all professional fees totaling $1.2 million related to ERC. Accordingly, the third quarter of 2023 reflects a $5.1 million reduction in noninterest income and a $1.2 million reduction in noninterest expense related to the return of the ERC. This was deemed a change in circumstance between the second and third quarters of 2023. The following table for the three months ended June 30, 2023 and the three months ended September 30, 2023 eliminates the effect of the ERC. There is no impact on the nine months ended September 30, 2023.

Results excluding ERC


	Three Months Ended						Nine Months Ended
	September 30, 2023			June 30, 2023			September 30, 2023

Results of Operations
Interest income	$	35,204		$	32,185		$	96,088
Interest expense	14,473			12,753			36,379
Net interest income	20,731			19,432			59,709
Provision for credit losses	773			1,557			3,511
Net interest income after provision	19,958			17,875			56,198
Noninterest income	2,206			1,762			5,755
Noninterest expense	9,812			12,189			32,159
Income tax expense	2,843			1,572			6,738
Net income	$	9,509		$	5,876		$	23,056

Per Share Data
Earnings per share:
Basic	$	1.07		$	0.67		$	2.62
Diluted	$	1.05		$	0.66		$	2.56

Performance and Financial Ratios
ROAA	1.65		%	1.07		%	1.41		%
ROAE	18.59		%	12.18		%	15.85		%
Efficiency ratio	42.76		%	57.39		%	49.47		%

Net Interest Income and Net Interest Margin


	Three Months Ended									% Change September 30, 2023 vs.
	September 30, 2023			June 30, 2023			September 30, 2022			June 30, 2023		September 30, 2022
	(Dollars in thousands)

Average interest-earning assets	$	2,175,103		$	2,091,998		$	1,859,104		4.0	%	17.0	%
Net interest income	$	20,731		$	19,432		$	19,435		6.7	%	6.7	%
Net interest margin	3.78		%	3.73		%	4.15		%	5	bps	(37)	bps

Net interest income for the third quarter of 2023 was $20.7 million, an increase of 6.7% from $19.4 million for the second quarter of 2023. The increase was primarily driven by the impact of a higher yield on interest-earning assets due to both growth and higher interest rates, which more than offset a higher cost of interest-bearing deposits primarily due to rising interest rates.

Relative to the third quarter of 2022, net interest income increased $1.3 million, or 6.7%. The increase was primarily the result of a sharp improvement in the yield on interest-earning assets due to both year over year growth and higher interest rates, which outpaced the accelerated rise in costs on interest-bearing liabilities due to a rapid rise in interest rates, coupled with growth in interest-bearing liabilities. A portion of the growth in interest-bearing deposits is due to migration from noninterest-bearing into interest-bearing deposits.

Net interest margin for the third quarter of 2023 was 3.78%, compared to 3.73% for the second quarter of 2023. The increase was primarily due to an increase in the average balance and yield on interest-earning assets, which outpaced the combined effect of higher average balances and cost of interest-bearing deposits.

Relative to the third quarter of 2022, net interest margin decreased from 4.15%. The decrease was primarily due to a rapid increase in interest rates, which accelerated the cost on interest-bearing liabilities at a faster pace than the yield received on interest-earning assets. A shift from noninterest-bearing deposits into interest-bearing deposits also had a negative impact on net interest margin.

Noninterest Income


	Three Months Ended						% Change September 30, 2023 vs.
	September 30, 2023		June 30, 2023		September 30, 2022		June 30, 2023		September 30, 2022
	(Dollars in thousands)

Service charges on deposit accounts	$	442	$	456	$	508	(3.1)	%	(13.0)	%
Swap fees	453		173		11		161.8	%	4018.2	%
SBA/USDA fees	74		66		95		12.1	%	(22.1)	%
Mortgage origination fees	158		188		218		(16.0)	%	(27.5)	%
Net loss on securities	(12)		(45)		(143)		(73.3)	%	(91.6)	%
Employee retention credit and related revenue	(5,100)		5,100		—		N/A		N/A
Other operating income	1,091		924		650		18.1	%	67.8	%
Total noninterest income	$	(2,894)	$	6,862	$	1,339	(142.2)	%	(316.1)	%

Noninterest income for the third quarter of 2023 was reported as a $2.9 million net expense, compared to noninterest income of $6.9 million for the second quarter of 2023. The change in ERC eligibility between the second and third quarters of 2023 is substantially the reason for the significant variation. This decrease was partially offset by a $280,000 increase in swap fees during the third quarter of 2023.

Relative to the third quarter of 2022, noninterest income decreased 316.1% from $1.3 million. The decrease was substantially due to the aforementioned return of ERC. This decrease was partially offset by a $280,000 increase in swap fees during the third quarter of 2023 and $132,000 in dividend income realized on equity securities.

Noninterest Expense


	Three Months Ended						% Change September 30, 2023 vs.
	September 30, 2023		June 30, 2023		September 30, 2022		June 30, 2023		September 30, 2022
	(Dollars in thousands)

Salaries and employee benefits	$	5,752	$	7,863	$	6,152	(26.8)	%	(6.5)	%
Equipment and occupancy expenses	718		694		764		3.5	%	(6.0)	%
Data processing fees	650		646		599		0.6	%	8.5	%
Regulatory assessments	322		180		235		78.9	%	37.0	%
Professional fees related to ERC	(1,243)		1,243		—		N/A		N/A
Other operating expenses	2,370		2,806		2,487		(15.5)	%	(4.7)	%
Total noninterest expenses	$	8,569	$	13,432	$	10,237	(36.2)	%	(16.3)	%

Noninterest expense for the third quarter of 2023 was $8.6 million, a decrease of 36.2% from $13.4 million for the second quarter of 2023. The decrease was substantially attributable to a decrease in salaries and benefits as a result of significantly less retirement expenses during the third quarter of 2023, in addition to several open positions. Additionally, the change in ERC eligibility resulted in a $1.2 million refund of professional fees related to the ERC. Provision for unfunded loan commitments decreased $181,000 during the third quarter of 2023.

Relative to the third quarter of 2022, noninterest expense decreased 16.3% from $10.2 million. The decrease was substantially due to the aforementioned refund of professional fees related to the ERC, a decrease in salaries and benefits as a result of a reduction in employees and a net reduction in forgery/fraud losses during the third quarter of 2023.

Loans and Credit Quality


	Three Months Ended									% Change September 30, 2023 vs.
	September 30, 2023			June 30, 2023			September 30, 2022			June 30, 2023		September 30, 2022
	(Dollars in thousands)

Gross loans	1,779,846			1,722,278			1,530,129			3.3	%	16.3	%
Unearned income	(5,698)			(5,766)			(5,139)			(1.2)	%	10.9	%
Loans, net of unearned income (“Loans”)	$	1,774,148		$	1,716,512		$	1,524,990		3.4	%	16.3	%
Average loans, net of unearned (“Average loans”)	$	1,740,582		$	1,676,816		$	1,480,735		3.8	%	17.5	%

Nonperforming loans (“NPL”)	$	1,082		$	1,010		$	3,950		7.1	%	(72.6)	%
Provision for credit losses	$	773		$	1,557		$	1,663		(50.4)	%	(53.5)	%
Allowance for credit losses (“ACL”)	$	22,181		$	21,385		$	18,423		3.7	%	20.4	%
Net charge-offs (recoveries)	$	(23)		$	27		$	47		(185.2)	%	(148.9)	%
NPL to gross loans	0.06		%	0.06		%	0.26		%
Net charge-offs (recoveries) to average loans(1)	(0.01)		%	0.01		%	0.01		%
ACL to loans	1.25		%	1.25		%	1.21		%

(1) Ratio is annualized.

Loans, net of unearned income, were $1.8 billion at September 30, 2023, up $57.6 million from June 30, 2023 and up $249.2 million from September 30, 2022. The linked-quarter and year-over-year increases in loans were primarily attributable to new business growth across our footprint.

Nonperforming loans totaled $1.1 million, or 0.06% of gross loans, at September 30, 2023, compared with $1.0 million, or 0.06% of gross loans, at June 30, 2023, and $4.0 million, or 0.26% of gross loans, at September 30, 2022. The $72,000 net increase in nonperforming loans in the third quarter of 2023 was primarily attributable to a commercial real estate loan that was added to nonaccrual status and partially offset by a commercial real estate loan that moved back to accruing status. The $2.9 million net decrease in nonperforming loans from September 30, 2022, was primarily attributable to a significant commercial real estate loan being moved back to accruing status, two loans that were paid-off and one loan that was charged-off.

The Company recorded a provision for credit losses of $773,000 for the third quarter of 2023, compared to $1.6 million for the second quarter of 2023. Provision in the second quarter of 2023 was based on increases for qualitative economic factors as well as loan growth, whereas provision in the third quarter of 2023 was based solely on loan growth. The Company expects future provisions to be based on loan growth, unless credit issues arise.

Net recoveries for the third quarter of 2023 were $23,000, or (0.01)% of average loans on an annualized basis, compared to net charge-offs of $27,000, or 0.01% of average loans on an annualized basis, for the second quarter of 2023, and net charge-offs of $47,000, or 0.01% of average loans on an annualized basis, for the third quarter of 2022.

The Company’s allowance for credit losses was 1.25% of total loans and 2050.00% of nonperforming loans at September 30, 2023, compared with 1.25% of total loans and 2117.33% of nonperforming loans at June 30, 2023. Allowance for credit losses on unfunded commitments was $1.5 million at September 30, 2023.

Deposits


	Three Months Ended									% Change September 30, 2023 vs.
	September 30, 2023			June 30, 2023			September 30, 2022			June 30, 2023		September 30, 2022
	(Dollars in thousands)

Noninterest-bearing deposits	$	418,125		$	449,433		$	499,613		(7.0)	%	(16.3)	%
Interest-bearing deposits	1,498,276			1,474,478			1,267,479			1.6	%	18.2	%
Total deposits	$	1,916,401		$	1,923,911		$	1,767,092		(0.4)	%	8.4	%

Uninsured deposits	$	568,323		$	553,084		$	707,371		2.8	%	(19.7)	%
Uninsured deposits to total deposits	29.66		%	28.75		%	40.03		%
Noninterest deposits to total deposits	21.82		%	23.36		%	28.27		%

Total deposits were $1.9 billion at September 30, 2023, down slightly from June 30, 2023 and up from $1.8 billion at September 30, 2022. The $7.5 million decrease in total deposits in the third quarter was primarily related to a reduction in brokered deposits of $25.9 million, partially offset by an $18.4 million increase in customer deposits. Total brokered deposits were $168.3 million at September 30, 2023.

Capital


	September 30, 2023				June 30, 2023				September 30, 2022
	Company		Bank		Company		Bank		Company		Bank

Tier 1 capital ratio to average assets	8.70	%	11.71	%	8.70	%	11.82	%	8.44	%	11.49	%
Risk-based capital ratios:
Common equity tier 1 (“CET1”) capital ratio	9.32	%	12.55	%	9.11	%	12.37	%	8.73	%	11.89	%
Tier 1 capital ratio	9.32	%	12.55	%	9.11	%	12.37	%	8.73	%	11.89	%
Total capital ratio	14.60	%	13.67	%	14.42	%	13.47	%	12.26	%	12.87	%

As of September 30, 2023, total stockholders’ equity was $201.9 million, up from $197.3 million at June 30, 2023. The increase of $4.7 million was substantially due to earnings growth, partially offset by an increase in accumulated other comprehensive loss resulting from changes in the value of the available for sale securities portfolio.

About Southern States Bancshares, Inc.

Headquartered in Anniston, Alabama, Southern States Bancshares, Inc. is a bank holding company that operates primarily through its wholly-owned subsidiary, Southern States Bank. The Bank is a full service community banking institution, which offers an array of deposit, loan and other banking-related products and services to businesses and individuals in its communities. The Bank operates 13 branches in Alabama and Georgia and two loan production offices in Atlanta.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the federal securities laws, which reflect our current expectations and beliefs with respect to, among other things, future events and our financial performance. These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections about our industry, management’s beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond our control. This may be especially true given recent events and trends in the banking industry and the inflationary environment. Although we believe that the expectations reflected in such forward-looking statements are reasonable as of the dates made, we cannot give any assurance that such expectations will prove correct and actual results may prove to be materially different from the results expressed or implied by the forward-looking statements. Important factors that could cause actual results to differ materially from those in the forward-looking statements are set forth in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022 under the section entitled “Cautionary Note Regarding Forward-Looking Statements” and “Risk Factors”. Accordingly, we caution you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions and uncertainties that are difficult to predict.

These statements are often, but not always, made through the use of words or phrases such as “may,” “can,” “should,” “could,” “to be,” “predict,” “potential,” “believe,” “will likely result,” “expect,” “continue,” “will,” “likely,” “anticipate,” “seek,” “estimate,” “intend,” “plan,” “target,” “project,” “would” and “outlook,” or the negative version of those words or other similar words or phrases of a future or forward-looking nature. Forward-looking statements appear in a number of places in this press release and may include statements about business strategy and prospects for growth, operations, ability to pay dividends, competition, regulation and general economic conditions.

Contact Information

Lynn Joyce

Kevin Dobbs

(205) 820-8065

(310) 622-8245

ljoyce@ssbank.bank

ssbankir@finprofiles.com


SELECT FINANCIAL DATA
(Dollars in thousands, except share and per share amounts)

	Three Months Ended									Nine Months Ended
	September 30, 2023			June 30, 2023			September 30, 2022			September 30, 2023			September 30, 2022

Results of Operations
Interest income	$	35,204		$	32,185		$	22,520		$	96,088		$	56,144
Interest expense	14,473			12,753			3,085			36,379			5,690
Net interest income	20,731			19,432			19,435			59,709			50,454
Provision for credit losses	773			1,557			1,663			3,511			3,667
Net interest income after provision	19,958			17,875			17,772			56,198			46,787
Noninterest income	(2,894)			6,862			1,339			5,755			4,074
Noninterest expense	8,569			13,432			10,237			32,159			29,178
Income tax expense	1,866			2,549			2,174			6,738			5,204
Net income	$	6,629		$	8,756		$	6,700		$	23,056		$	16,479
Core net income(1)	$	9,563		$	7,058		$	6,806		$	23,901		$	16,883

Share and Per Share Data
Shares issued and outstanding	8,834,168			8,738,814			8,705,920			8,834,168			8,705,920
Weighted average shares outstanding:
Basic	8,846,018			8,763,635			8,693,745			8,791,007			8,797,720
Diluted	9,040,687			8,950,847			8,871,116			9,016,603			8,952,600
Earnings per share:
Basic	$	0.75		$	1.00		$	0.77		$	2.62		$	1.87
Diluted	$	0.73		$	0.98		$	0.75		$	2.56		$	1.84
Core - diluted(1)	$	1.06		$	0.79		$	0.77		$	2.65		$	1.89
Book value per share	$	22.86		$	22.57		$	19.56		$	22.86		$	19.56
Tangible book value per share(1)	$	20.84		$	20.52		$	17.48		$	20.84		$	17.48
Cash dividends per common share	$	0.09		$	0.09		$	0.09		$	0.27		$	0.27

Performance and Financial Ratios
ROAA	1.15		%	1.60		%	1.35		%	1.41		%	1.19		%
ROAE	12.96		%	18.15		%	15.42		%	15.85		%	12.72		%
Core ROAA(1)	1.66		%	1.29		%	1.37		%	1.47		%	1.21		%
ROATCE(1)	14.21		%	20.01		%	17.24		%	17.47		%	14.22		%
Core ROATCE(1)	20.50		%	16.13		%	17.51		%	18.11		%	14.57		%
NIM	3.78		%	3.73		%	4.15		%	3.85		%	3.85		%
NIM - FTE(2)	3.79		%	3.74		%	4.17		%	3.87		%	3.87		%
Net interest spread	2.84		%	2.86		%	3.86		%	3.00		%	3.64		%
Yield on loans	6.86		%	6.61		%	5.37		%	6.62		%	4.97		%
Yield on interest-earning assets	6.42		%	6.17		%	4.81		%	6.20		%	4.29		%
Cost of interest-bearing liabilities	3.58		%	3.31		%	0.95		%	3.20		%	0.65		%
Cost of funds(2)	2.80		%	2.58		%	0.69		%	2.48		%	0.46		%
Cost of interest-bearing deposits	3.43		%	3.12		%	0.82		%	3.02		%	0.52		%
Cost of total deposits	2.63		%	2.38		%	0.58		%	2.29		%	0.36		%
Noninterest deposits to total deposits	21.82		%	23.36		%	28.27		%	21.82		%	28.27		%
Core deposits to total deposits	86.58		%	86.18		%	92.17		%	86.58		%	92.17		%
Uninsured deposits to total deposits	29.66		%	28.75		%	40.03		%	29.66		%	40.03		%
Total loans to total deposits	92.58		%	89.22		%	86.30		%	92.58		%	86.30		%
Efficiency ratio	48.01		%	51.00		%	48.94		%	49.47		%	52.98		%
Core efficiency ratio(1)	42.79		%	49.96		%	48.94		%	47.06		%	52.98		%

(1) See "Reconciliation of Non-GAAP Financial Measures" below for reconciliation of non-GAAP financial measures to their most closely comparable GAAP financial measures.

(2) Includes total interest-bearing liabilities and noninterest deposits.


SELECT FINANCIAL DATA
(Dollars in thousands)

	Three Months Ended									Nine Months Ended
	September 30, 2023			June 30, 2023			September 30, 2022			September 30, 2023			September 30, 2022

Financial Condition (ending)
Total loans	$	1,774,148		$	1,716,512		$	1,524,990		$	1,774,148		$	1,524,990
Total securities	189,496			182,717			170,375			189,496			170,375
Total assets	2,296,527			2,277,803			2,052,725			2,296,527			2,052,725
Total noninterest bearing deposits	418,125			449,433			499,613			418,125			499,613
Total core deposits(1)	1,659,291			1,657,961			1,628,660			1,659,291			1,628,660
Total deposits	1,916,401			1,923,911			1,767,092			1,916,401			1,767,092
Total borrowings	146,573			131,472			93,020			146,573			93,020
Total liabilities	2,094,603			2,080,553			1,882,400			2,094,603			1,882,400
Total shareholders’ equity	201,924			197,250			170,325			201,924			170,325

Financial Condition (average)
Total loans	$	1,740,582		$	1,676,816		$	1,480,735		$	1,676,134		$	1,373,564
Total securities	201,830			196,731			185,670			197,005			175,381
Total other interest-earning assets	232,691			218,451			192,699			199,379			202,837
Total interest-bearing assets	2,175,103			2,091,998			1,859,104			2,072,518			1,751,782
Total assets	2,282,217			2,200,843			1,966,556			2,180,851			1,858,993
Total noninterest-bearing deposits	448,616			438,987			491,917			442,149			502,951
Total interest-bearing deposits	1,472,024			1,412,047			1,207,797			1,395,529			1,097,693
Total deposits	1,920,640			1,851,034			1,699,714			1,837,678			1,600,644
Total borrowings	129,882			131,411			75,039			122,156			68,719
Total interest-bearing liabilities	1,601,906			1,543,458			1,282,836			1,517,685			1,166,412
Total shareholders’ equity	202,955			193,516			172,402			194,430			173,210

Asset Quality
Nonperforming loans	$	1,082		$	1,010		$	3,950		$	1,082		$	3,950
Other real estate owned (“OREO”)	$	2,903		$	2,870		$	2,930		$	2,903		$	2,930
Nonperforming assets (“NPA”)	$	3,985		$	3,880		$	6,880		$	3,985		$	6,880
Net charge-offs (recovery) to average loans(2)	(0.01)		%	0.01		%	0.01		%	0.02		%	0.01		%
Provision for credit losses to average loans(2)	0.18		%	0.37		%	0.45		%	0.28		%	0.36		%
ACL to loans	1.25		%	1.25		%	1.21		%	1.25		%	1.21		%
ACL to gross loans	1.25		%	1.24		%	1.20		%	1.25		%	1.20		%
ACL to NPL	2050.00		%	2117.33		%	466.41		%	2050.00		%	466.41		%
NPL to loans	0.06		%	0.06		%	0.26		%	0.06		%	0.26		%
NPL to gross loans	0.06		%	0.06		%	0.26		%	0.06		%	0.26		%
NPA to gross loans and OREO	0.22		%	0.22		%	0.45		%	0.22		%	0.45		%
NPA to total assets	0.17		%	0.17		%	0.34		%	0.17		%	0.34		%

Regulatory and Other Capital Ratios
Total shareholders’ equity to total assets	8.79		%	8.66		%	8.30		%	8.79		%	8.30		%
Tangible common equity to tangible assets(3)	8.08		%	7.94		%	7.48		%	8.08		%	7.48		%
Tier 1 capital ratio to average assets	8.70		%	8.70		%	8.44		%	8.70		%	8.44		%
Risk-based capital ratios:
CET1 capital ratio	9.32		%	9.11		%	8.73		%	9.32		%	8.73		%
Tier 1 capital ratio	9.32		%	9.11		%	8.73		%	9.32		%	8.73		%
Total capital ratio	14.60		%	14.42		%	12.26		%	14.60		%	12.26		%

(1) We define core deposits as total deposits excluding brokered deposits and time deposits greater than $250,000.

(2) Ratio is annualized.

(3) See "Reconciliation of Non-GAAP Financial Measures" below for reconciliation of non-GAAP financial measures to their most closely comparable GAAP financial measures.


CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(Dollars in thousands)

	September 30, 2023		June 30, 2023		December 31, 2022		September 30, 2022
	(Unaudited)		(Unaudited)		(Audited)		(Unaudited)

Assets
Cash and due from banks	$	31,047	$	21,299	$	15,260	$	17,394
Interest-bearing deposits in banks	103,646		159,818		90,198		165,637
Federal funds sold	81,487		84,812		63,041		63,031
Total cash and cash equivalents	216,180		265,929		168,499		246,062

Securities available for sale, at fair value	169,859		163,075		155,544		150,718
Securities held to maturity, at amortized cost	19,637		19,642		19,652		19,657
Other equity securities, at fair value	3,654		3,762		4,444		5,694
Restricted equity securities, at cost	4,971		3,862		3,134		2,791
Loans held for sale	1,799		1,589		1,047		1,643

Loans, net of unearned income	1,774,148		1,716,512		1,587,164		1,524,990
Less allowance for credit losses	22,181		21,385		20,156		18,423
Loans, net	1,751,967		1,695,127		1,567,008		1,506,567

Premises and equipment, net	26,694		26,957		27,345		28,585
Accrued interest receivable	8,321		7,372		6,963		5,699
Bank owned life insurance	29,697		29,521		29,186		29,677
Annuities	15,266		15,359		15,478		15,564
Foreclosed assets	2,903		2,870		2,930		2,930
Goodwill	16,862		16,862		16,862		16,862
Core deposit intangible	981		1,062		1,226		1,302
Other assets	27,736		24,814		25,886		18,974

Total assets	$	2,296,527	$	2,277,803	$	2,045,204	$	2,052,725

Liabilities and Stockholders' Equity
Liabilities:
Deposits:
Noninterest-bearing	$	418,125	$	449,433	$	460,977	$	499,613
Interest-bearing	1,498,276		1,474,478		1,259,766		1,267,479
Total deposits	1,916,401		1,923,911		1,720,743		1,767,092

Other borrowings	4,991		(13)		(19)		19,978
FHLB advances	55,000		45,000		31,000		26,000
Subordinated notes	86,582		86,485		86,314		47,042
Accrued interest payable	1,280		1,063		584		359
Other liabilities	30,349		24,107		24,863		21,929

Total liabilities	2,094,603		2,080,553		1,863,485		1,882,400
Stockholders' equity:
Common stock	44,307		43,831		43,714		43,529
Capital surplus	77,671		77,101		76,785		75,835
Retained earnings	94,429		88,603		73,764		63,956
Accumulated other comprehensive loss	(13,126)		(10,799)		(11,048)		(12,403)
Unvested restricted stock	(580)		(709)		(477)		(592)
Vested restricted stock units	(777)		(777)		(1,019)		—

Total stockholders' equity	201,924		197,250		181,719		170,325

Total liabilities and stockholders' equity	$	2,296,527	$	2,277,803	$	2,045,204	$	2,052,725


CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except per share amounts)

	Three Months Ended						Nine Months Ended
	September 30, 2023		June 30, 2023		September 30, 2022		September 30, 2023		September 30, 2022
	(Unaudited)		(Unaudited)		(Unaudited)		(Unaudited)		(Unaudited)
Interest income:
Loans, including fees	$	30,084	$	27,630	$	20,052	$	83,049	$	51,083
Taxable securities	1,796		1,641		1,010		4,819		2,417
Nontaxable securities	227		228		323		747		931
Other interest and dividends	3,097		2,686		1,135		7,473		1,713
Total interest income	35,204		32,185		22,520		96,088		56,144

Interest expense:
Deposits	12,732		10,998		2,489		31,498		4,251
Other borrowings	1,741		1,755		596		4,881		1,439
Total interest expense	14,473		12,753		3,085		36,379		5,690

Net interest income	20,731		19,432		19,435		59,709		50,454
Provision for credit losses	773		1,557		1,663		3,511		3,667
Net interest income after provision for credit losses	19,958		17,875		17,772		56,198		46,787

Noninterest income:
Service charges on deposit accounts	442		456		508		1,348		1,433
Swap fees	453		173		11		622		48
SBA/USDA fees	74		66		95		274		575
Mortgage origination fees	158		188		218		446		717
Net (loss) gain on securities	(12)		(45)		(143)		457		(546)
Employee retention credit and related revenue	(5,100)		5,100		—		—		—
Other operating income	1,091		924		650		2,608		1,847
Total noninterest income	(2,894)		6,862		1,339		5,755		4,074

Noninterest expenses:
Salaries and employee benefits	5,752		7,863		6,152		19,926		17,859
Equipment and occupancy expenses	718		694		764		2,095		2,188
Data processing fees	650		646		599		1,889		1,733
Regulatory assessments	322		180		235		844		760
Professional fees related to ERC	(1,243)		1,243		—		—		—
Other operating expenses	2,370		2,806		2,487		7,405		6,638
Total noninterest expenses	8,569		13,432		10,237		32,159		29,178

Income before income taxes	8,495		11,305		8,874		29,794		21,683

Income tax expense	1,866		2,549		2,174		6,738		5,204

Net income	$	6,629	$	8,756	$	6,700	$	23,056	$	16,479

Basic earnings per share	$	0.75	$	1.00	$	0.77	$	2.62	$	1.87

Diluted earnings per share	$	0.73	$	0.98	$	0.75	$	2.56	$	1.84


AVERAGE BALANCE SHEET AND NET INTEREST MARGIN
(Dollars in thousands)

	Three Months Ended
	September 30, 2023						June 30, 2023						September 30, 2022
	Average Balance		Interest		Yield/Rate		Average Balance		Interest		Yield/Rate		Average Balance		Interest		Yield/Rate
Assets:
Interest-earning assets:
Loans, net of unearned income(1)	$	1,740,582	$	30,084	6.86	%	$	1,676,816	$	27,630	6.61	%	$	1,480,735	$	20,052	5.37	%
Taxable securities	156,364		1,796		4.56	%	151,107		1,641		4.36	%	128,932		1,010		3.11	%
Nontaxable securities	45,466		227		1.98	%	45,624		228		2.00	%	56,738		323		2.26	%
Other interest-earnings assets	232,691		3,097		5.28	%	218,451		2,686		4.93	%	192,699		1,135		2.34	%
Total interest-earning assets	$	2,175,103	$	35,204	6.42	%	$	2,091,998	$	32,185	6.17	%	$	1,859,104	$	22,520	4.81	%
Allowance for credit losses	(21,606)						(20,154)						(17,250)
Noninterest-earning assets	128,720						128,999						124,702
Total Assets	$	2,282,217					$	2,200,843					$	1,966,556

Liabilities and Stockholders’ Equity:
Interest-bearing liabilities:
Interest-bearing transaction accounts	88,668		20		0.09	%	92,245		20		0.09	%	114,517		26		0.09	%
Savings and money market accounts	867,066		7,767		3.55	%	845,742		6,872		3.26	%	811,349		1,644		0.80	%
Time deposits	516,290		4,945		3.80	%	474,060		4,106		3.47	%	281,931		819		1.15	%
FHLB advances	43,261		514		4.72	%	45,000		529		4.72	%	27,380		102		1.47	%
Other borrowings	86,621		1,227		5.62	%	86,411		1,226		5.69	%	47,659		494		4.12	%
Total interest-bearing liabilities	$	1,601,906	$	14,473	3.58	%	$	1,543,458	$	12,753	3.31	%	$	1,282,836	$	3,085	0.95	%

Noninterest-bearing liabilities:
Noninterest-bearing deposits	$	448,616					$	438,987					$	491,917
Other liabilities	28,740						24,882						19,401
Total noninterest-bearing liabilities	477,356						463,869						511,318
Stockholders’ Equity	202,955						193,516						172,402
Total Liabilities and Stockholders’ Equity	$	2,282,217					$	2,200,843					$	1,966,556

Net interest income			$	20,731					$	19,432					$	19,435
Net interest spread(2)					2.84	%					2.86	%					3.86	%
Net interest margin(3)					3.78	%					3.73	%					4.15	%
Net interest margin - FTE(4)(5)					3.79	%					3.74	%					4.17	%
Cost of funds(6)					2.80	%					2.58	%					0.69	%
Cost of interest-bearing deposits					3.43	%					3.12	%					0.82	%
Cost of total deposits					2.63	%					2.38	%					0.58	%

(1)Includes nonaccrual loans.

(2)Net interest spread is the difference between interest rates earned on interest earning assets and interest rates paid on interest-bearing liabilities.

(3)Net interest margin is a ratio of net interest income to average interest earning assets for the same period.

(4)Net interest margin - FTE is a ratio of fully-taxable equivalent net interest income to average interest earning assets for the same period. It assumes a 24.0% tax rate.

(5)Refer to “Reconciliation of Non-GAAP Financial Measures”.

(6)Includes total interest-bearing liabilities and noninterest deposits.


AVERAGE BALANCE SHEET AND NET INTEREST MARGIN
(Dollars in thousands)

	Nine Months Ended
	September 30, 2023						September 30, 2022
	Average Balance		Interest		Yield/Rate		Average Balance		Interest		Yield/Rate
Assets:
Interest-earning assets:
Loans, net of unearned income(1)	$	1,676,134	$	83,049	6.62	%	$	1,373,564	$	51,083	4.97	%
Taxable securities	149,058		4,819		4.32	%	119,224		2,417		2.71	%
Nontaxable securities	47,947		747		2.08	%	56,157		931		2.22	%
Other interest-earnings assets	199,379		7,473		5.01	%	202,837		1,713		1.13	%
Total interest-earning assets	$	2,072,518	$	96,088	6.20	%	$	1,751,782	$	56,144	4.29	%
Allowance for credit losses	(20,750)						(16,044)
Noninterest-earning assets	129,083						123,255
Total Assets	$	2,180,851					$	1,858,993

Liabilities and Stockholders’ Equity:
Interest-bearing liabilities:
Interest-bearing transaction accounts	91,602		59		0.09	%	113,427		78		0.09	%
Savings and money market accounts	839,827		19,679		3.13	%	741,397		2,862		0.52	%
Time deposits	464,100		11,760		3.39	%	242,869		1,311		0.72	%
FHLB advances	35,703		1,202		4.50	%	26,115		144		0.74	%
Other borrowings	86,453		3,679		5.69	%	42,604		1,295		4.06	%
Total interest-bearing liabilities	$	1,517,685	$	36,379	3.20	%	$	1,166,412	$	5,690	0.65	%

Noninterest-bearing liabilities:
Noninterest-bearing deposits	$	442,149					$	502,951
Other liabilities	26,587						16,420
Total noninterest-bearing liabilities	$	468,736					$	519,371
Stockholders’ Equity	194,430						173,210
Total Liabilities and Stockholders’ Equity	$	2,180,851					$	1,858,993

Net interest income			$	59,709					$	50,454
Net interest spread(2)					3.00	%					3.64	%
Net interest margin(3)					3.85	%					3.85	%
Net interest margin - FTE(4)(5)					3.87	%					3.87	%
Cost of funds(6)					2.48	%					0.46	%
Cost of interest-bearing deposits					3.02	%					0.52	%
Cost of total deposits					2.29	%					0.36	%

(1)Includes nonaccrual loans.

(2)Net interest spread is the difference between interest rates earned on interest earning assets and interest rates paid on interest-bearing liabilities.

(3)Net interest margin is a ratio of net interest income to average interest earning assets for the same period.

(4)Net interest margin - FTE is a ratio of fully-taxable equivalent net interest income to average interest earning assets for the same period. It assumes a 24.0% tax rate.

(5)Refer to “Reconciliation of Non-GAAP Financial Measures”.

(6)Includes total interest-bearing liabilities and noninterest deposits.


LOAN COMPOSITION
(Dollars in thousands)

	September 30, 2023				June 30, 2023				December 31, 2022				September 30, 2022
	Amount		% of gross		Amount		% of gross		Amount		% of gross		Amount		% of gross

Real estate mortgages:
Construction and development	$	229,188	12.9	%	$	228,236	13.3	%	$	255,736	16.1	%	$	222,159	14.5	%
Residential	224,499		12.6	%	214,897		12.5	%	167,891		10.5	%	164,296		10.7	%
Commercial	1,049,545		59.0	%	1,011,815		58.7	%	904,872		56.8	%	889,942		58.2	%
Commercial and industrial	268,283		15.0	%	259,195		15.0	%	256,553		16.1	%	243,577		15.9	%
Consumer and other	8,331		0.5	%	8,135		0.5	%	7,655		0.5	%	10,155		0.7	%
Gross loans	1,779,846		100.0	%	1,722,278		100.0	%	1,592,707		100.0	%	1,530,129		100.0	%
Unearned income	(5,698)				(5,766)				(5,543)				(5,139)
Loans, net of unearned income	1,774,148				1,716,512				1,587,164				1,524,990
Allowance for credit losses	(22,181)				(21,385)				(20,156)				(18,423)
Loans, net	$	1,751,967			$	1,695,127			$	1,567,008			$	1,506,567


DEPOSIT COMPOSITION
(Dollars in thousands)

	September 30, 2023				June 30, 2023				December 31, 2022				September 30, 2022
	Amount		% of total		Amount		% of total		Amount		% of total		Amount		% of total


Noninterest-bearing transaction	$	418,125	21.8	%	$	449,433	23.3	%	$	460,977	26.8	%	$	499,613	28.3	%
Interest-bearing transaction	934,383		48.8	%	922,835		48.0	%	837,127		48.6	%	855,350		48.4	%
Savings	38,518		2.0	%	41,574		2.2	%	49,235		2.9	%	78,687		4.5	%
Time deposits, $250,000 and under	436,613		22.8	%	438,228		22.8	%	307,145		17.8	%	266,491		15.0	%
Time deposits, over $250,000	88,762		4.6	%	71,841		3.7	%	66,259		3.9	%	66,951		3.8	%
Total deposits	$	1,916,401	100.0	%	$	1,923,911	100.0	%	$	1,720,743	100.0	%	$	1,767,092	100.0	%


Nonperfoming Assets
(Dollars in thousands)

	September 30, 2023			June 30, 2023			December 31, 2022			September 30, 2022


Nonaccrual loans	$	1,082		$	1,010		$	2,245		$	3,950
Past due loans 90 days or more and still accruing interest	—			—			—			—
Total nonperforming loans	1,082			1,010			2,245			3,950
OREO	2,903			2,870			2,930			2,930

Total nonperforming assets	$	3,985		$	3,880		$	5,175		$	6,880

Troubled debt restructured loans – nonaccrual(1)	970			724			832			1,011
Troubled debt restructured loans – accruing	1,052			1,328			1,292			1,307
Total troubled debt restructured loans	$	2,022		$	2,052		$	2,124		$	2,318

Allowance for credit losses	$	22,181		$	21,385		$	20,156		$	18,423
Loans, net of unearned income at the end of the period	$	1,774,148		$	1,716,512		$	1,587,164		$	1,524,990
Gross loans outstanding at the end of period	$	1,779,846		$	1,722,278		$	1,592,707		$	1,530,129
Total assets	$	2,296,527		$	2,277,803		$	2,045,204		$	2,052,725
Allowance for credit losses to nonperforming loans	2050.00		%	2117.33		%	897.82		%	466.41		%
Nonperforming loans to loans, net of unearned income	0.06		%	0.06		%	0.14		%	0.26		%
Nonperforming loans to gross loans	0.06		%	0.06		%	0.14		%	0.26		%
Nonperforming assets to gross loans and OREO	0.22		%	0.22		%	0.32		%	0.45		%
Nonperforming assets to total assets	0.17		%	0.17		%	0.25		%	0.34		%

Nonaccrual loans by category:
Real estate mortgages:
Construction & Development	$	—		$	33		$	67		$	70
Residential Mortgages	289			297			565			550
Commercial Real Estate Mortgages	785			671			1,278			2,888
Commercial & Industrial	8			9			312			434
Consumer and other	—			—			23			8
Total	$	1,082		$	1,010		$	2,245		$	3,950

(1) Troubled debt restructured loans are excluded from nonperforming loans unless they otherwise meet the definition of nonaccrual loans or are more than 90 days past due.


Allowance for Credit Losses
(Dollars in thousands)

	Three Months Ended									Nine Months Ended
	September 30, 2023			June 30, 2023			September 30, 2022			September 30, 2023			September 30, 2022

Average loans, net of unearned income	$	1,740,582		$	1,676,816		$	1,480,735		$	1,676,134		$	1,373,564
Loans, net of unearned income	$	1,774,148		$	1,716,512		$	1,524,990		$	1,774,148		$	1,524,990
Gross loans	$	1,779,846		$	1,722,278		$	1,530,129		$	1,779,846		$	1,530,129
Allowance for credit losses at beginning of the period	$	21,385		$	19,855		$	16,807		$	20,156		$	14,844
Impact of adoption of ASC 326	$	—		$	—		$	—		$	(1,285)		$	—
Charge-offs:
Construction and development	3			—			—			3			66
Residential	—			—			—			—			7
Commercial	—			—			—			—			—
Commercial and industrial	—			44			269			262			269
Consumer and other	—			—			1			6			8
Total charge-offs	3			44			270			271			350
Recoveries:
Construction and development	—			—			—			—			—
Residential	10			17			11			38			46
Commercial	—			—			—			—			—
Commercial and industrial	—			—			204			14			204
Consumer and other	16			—			8			18			12
Total recoveries	26			17			223			70			262
Net charge-offs (recoveries)	$	(23)		$	27		$	47		$	201		$	88

Provision for credit losses	$	773		$	1,557		$	1,663		$	3,511		$	3,667
Balance at end of the period	$	22,181		$	21,385		$	18,423		$	22,181		$	18,423

Allowance for credit losses on unfunded commitments at beginning of the period	$	1,495		$	1,285		$	—		$	—		$	—
Impact of adoption of ASC 326	—			—			—			1,285			—
Provision for credit losses on unfunded commitments	29			210			—			239			—
Balance at the end of the period	$	1,524		$	1,495		$	—		$	1,524		$	—

Allowance to loans, net of unearned income	1.25		%	1.25		%	1.21		%	1.25		%	1.21		%
Allowance to gross loans	1.25		%	1.24		%	1.20		%	1.25		%	1.20		%
Net charge-offs (recoveries) to average loans, net of unearned income(1)	(0.01)		%	0.01		%	0.01		%	0.02		%	0.01		%
Provision for credit losses to average loans, net of unearned income(1)	0.18		%	0.37		%	0.45		%	0.28		%	0.36		%

(1) Ratio is annualized.

Reconciliation of Non-GAAP Financial Measures

Noninterest Expense

In addition to reporting GAAP results, the Company reports non-GAAP financial measures in this earnings release and other disclosures. Our management believes that these non-GAAP financial measures and the information they provide are useful to investors since these measures permit investors to view our performance using the same tools that our management uses to evaluate our performance. While we believe that these non-GAAP financial measures are useful in evaluating our performance, this information should be considered as supplemental in nature and not as a substitute for or superior to the related financial information prepared in accordance with GAAP. Additionally, these non-GAAP financial measures may differ from similar measures presented by other companies.

The following table provides a reconciliation of the non-GAAP financial measures to their most directly comparable financial measure presented in accordance with GAAP.


Reconciliation of Non-GAAP Financial Measures
(Dollars in thousands, except share and per share amounts)

	Three Months Ended									Nine Months Ended
	September 30, 2023			June 30, 2023			September 30, 2022			September 30, 2023			September 30, 2022

Net income	$	6,629		$	8,756		$	6,700		$	23,056		$	16,479
Add: One-time retirement related expenses	—			1,571			—			1,571			—
Add: Professional fees related to ERC	(1,243)			1,243			—			—			—
Add: Net OREO (losses) gains	(9)			7			—			(2)			—

Less: Employee retention related revenue	(5,100)			5,100			—			—			—


Less: (Loss) gain on securities	(12)			(45)			(143)			457			(546)
Less: Tax effect	926			(536)			37			267			142
Core net income	$	9,563		$	7,058		$	6,806		$	23,901		$	16,883
Average assets	$	2,282,217		$	2,200,843		$	1,966,556		$	2,180,851		$	1,858,993
Core return on average assets	1.66		%	1.29		%	1.37		%	1.47		%	1.21		%

Net income	$	6,629		$	8,756		$	6,700		$	23,056		$	16,479
Add: One-time retirement related expenses	—			1,571			—			1,571			—
Add: Professional fees related to ERC	(1,243)			1,243			—			—			—
Add: Net OREO (losses) gains	(9)			7			—			(2)			—
Add: Provision	773			1,557			1,663			3,511			3,667

Less: Employee retention related revenue	(5,100)			5,100			—			—			—


Less: (Loss) gain on securities	(12)			(45)			(143)			457			(546)
Add: Income taxes	1,866			2,549			2,174			6,738			5,204
Pretax pre-provision core net income	$	13,128		$	10,628		$	10,680		$	34,417		$	25,896
Average assets	$	2,282,217		$	2,200,843		$	1,966,556		$	2,180,851		$	1,858,993
Pretax pre-provision core return on average assets	2.28		%	1.94		%	2.15		%	2.11		%	1.86		%

Net interest income	$	20,731		$	19,432		$	19,435		$	59,709		$	50,454
Add: Fully-taxable equivalent adjustments(1)	70			65			86			213			251
Net interest income - FTE	$	20,801		$	19,497		$	19,521		$	59,922		$	50,705

Net interest margin	3.78		%	3.73		%	4.15		%	3.85		%	3.85		%
Effect of fully-taxable equivalent adjustments(1)	0.01		%	0.01		%	0.02		%	0.02		%	0.02		%
Net interest margin - FTE	3.79		%	3.74		%	4.17		%	3.87		%	3.87		%

Total stockholders' equity	$	201,924		$	197,250		$	170,325		$	201,924		$	170,325
Less: Intangible assets	17,843			17,924			18,164			17,843			18,164

Tangible common equity	$	184,081		$	179,326		$	152,161		$	184,081		$	152,161

(1) Assumes a 24.0% tax rate.


Reconciliation of Non-GAAP Financial Measures
(Dollars in thousands, except share and per share amounts)

	Three Months Ended									Nine Months Ended
	September 30, 2023			June 30, 2023			September 30, 2022			September 30, 2023			September 30, 2022

Core net income	$	9,563		$	7,058		$	6,806		$	23,901		$	16,883
Diluted weighted average shares outstanding	9,040,687			8,950,847			8,871,116			9,016,603			8,952,600
Diluted core earnings per share	$	1.06		$	0.79		$	0.77		$	2.65		$	1.89

Common shares outstanding at year or period end	8,834,168			8,738,814			8,705,920			8,834,168			8,705,920
Tangible book value per share	$	20.84		$	20.52		$	17.48		$	20.84		$	17.48

Total assets at end of period	$	2,296,527		$	2,277,803		$	2,052,725		$	2,296,527		$	2,052,725
Less: Intangible assets	17,843			17,924			18,164			17,843			18,164
Adjusted assets at end of period	$	2,278,684		$	2,259,879		$	2,034,561		$	2,278,684		$	2,034,561
Tangible common equity to tangible assets	8.08		%	7.94		%	7.48		%	8.08		%	7.48		%

Total average shareholders equity	$	202,955		$	193,516		$	172,402		$	194,430		$	173,210
Less: Average intangible assets	17,893			17,974			18,203			17,973			18,270
Average tangible common equity	$	185,062		$	175,542		$	154,199		$	176,457		$	154,940
Net income to common shareholders	$	6,629		$	8,756		$	6,700		$	23,056		$	16,479
Return on average tangible common equity	14.21		%	20.01		%	17.24		%	17.47		%	14.22		%
Average tangible common equity	$	185,062		$	175,542		$	154,199		$	176,457		$	154,940
Core net income	$	9,563		$	7,058		$	6,806		$	23,901		$	16,883
Core return on average tangible common equity	20.50		%	16.13		%	17.51		%	18.11		%	14.57		%

Net interest income	$	20,731		$	19,432		$	19,435		$	59,709		$	50,454
Add: Noninterest income	(2,894)			6,862			1,339			5,755			4,074

Less: Employee retention related revenue	(5,100)			5,100			—			—			—


Less: (Loss) gain on securities	(12)			(45)			(143)			457			(546)
Operating revenue	$	22,949		$	21,239		$	20,917		$	65,007		$	55,074

Expenses:
Total noninterest expense	$	8,569		$	13,432		$	10,237		$	32,159		$	29,178
Less: One-time retirement related expenses	—			1,571			—			1,571			—
Less: Professional fees related to ERC	(1,243)			1,243			—			—			—
Less: Net OREO (losses) gains	(9)			7			—			(2)			—

Adjusted noninterest expenses	$	9,821		$	10,611		$	10,237		$	30,590		$	29,178
Core efficiency ratio	42.79		%	49.96		%	48.94		%	47.06		%	52.98		%

ssbk-x3q23investorpresen

Q3 2023 Investor Presentation October 23, 2023

2 Important Notices and Disclaimers Forward-Looking Statements This presentation contains forward-looking statements within the meaning of the federal securities laws, which reflect our current expectations and beliefs with respect to, among other things, future events and our financial performance. These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections about our industry, management’s beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond our control. This may be especially true given recent events and trends in the banking industry and the inflationary environment. Although we believe that the expectations reflected in such forward-looking statements are reasonable as of the dates made, we cannot give any assurance that such expectations will prove correct and actual results may prove to be materially different from the results expressed or implied by the forward-looking statements. Important factors that could cause actual results to differ materially from those in the forward-looking statements are set forth in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022 and in other SEC filings under the sections entitled “Cautionary Note Regarding Forward-Looking Statements” and “Risk Factors”. Accordingly, we caution you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions and uncertainties that are difficult to predict. These statements are often, but not always, made through the use of words or phrases such as “may,” “can,” “should,” “could,” “to be,” “predict,” “potential,” “believe,” “will likely result,” “expect,” “continue,” “will,” “likely,” “anticipate,” “seek,” “estimate,” “intend,” “plan,” “target,” “project,” “would” and “outlook,” or the negative version of those words or other similar words or phrases of a future or forward-looking nature. Forward-looking statements appear in a number of places in this presentation and may include statements about business strategy and prospects for growth, operations, ability to pay dividends, competition, regulation and general economic conditions. Non-GAAP Financial Measures In addition to reporting GAAP results, the Company reports non-GAAP financial measures in this presentation and other disclosures. Our management believes that these non-GAAP financial measures and the information they provide are useful to investors since these measures permit investors to view our performance using the same tools that our management uses to evaluate our performance. While we believe that these non- GAAP financial measures are useful in evaluating our performance, this information should be considered as supplemental in nature and not as a substitute for or superior to the related financial information prepared in accordance with GAAP. Additionally, these non-GAAP financial measures may differ from similar measures presented by other companies. For a reconciliation of the non-GAAP measures we use to the most comparable GAAP measures, see the Appendix to this presentation.

3 Branches (13) Legend Huntsville Birmingham Montgomery Columbus Atlanta Alabama Georgia 65 85 75 Anniston Auburn 20 85 75 85 65 65 59 Tuscaloosa LPOs (2) Quarterly Deposit NetLoans / Deposits: 92.58% Overview of Southern States Bancshares, Inc. Q2 ‘23 Financial Highlights Quarterly Asset Growth(2): 3.3%Assets ($B): $2.3 NPLs / Loans: 0.06% Quarterly Loan Growth(2): 13.3%Gross Loans ($B): $1.8 ACL / Loans: 1.25% Quarterly Deposit Reduction(3): (1.5%)Deposits ($B): $1.9 YTD NCOs / Avg. Loans: 0.02% TCE / TA(1): 8.08% Core Net Income(1)($M): $9.6 Core ROAA(1): 1.66% NIM: 3.78% Core Efficiency Ratio(1): 42.79% Mobile Savannah Macon Valdosta Augusta Southern States Bancshares (Nasdaq: SSBK) was founded in August 2007 and priced its IPO on August 11, 2021 Management team with 200 years of collective experience in the banking industry and deep ties to local markets History of solid growth, top-tier profitability and a strong credit culture Bifurcated expansion strategy through organic growth and disciplined M&A Focused on being a dominant bank in our smaller markets and a competitive player in the larger metropolitan areas Diversified loan portfolio complemented by lower-cost, core funding base Source: Company Documents; financial data as of the three months ended 9/30/23 unless otherwise noted (1) Please refer to non-U.S. GAAP reconciliation in the appendix (2) Annualized (3) Annualized; includes a $25.9 million decrease in brokered deposits in 3Q23 4.2%of Brokered Growth(2):

4 $62.3 $69.2 $72.8 $88.1 $93.1 $70.7 $83.3 Columbus MSA Auburn- Opelika MSA Birmingham MSA Huntsville MSA Atlanta MSA Southeast Average National Average 1.6% 1.9% 4.7% 5.9% 6.6% 3.2% 2.1% Birmingham MSA Columbus MSA Atlanta MSA Huntsville MSA Auburn- Opelika MSA Southeast Average National Average Columbus, GA Major Employers Market Highlights Robust Market Dynamics Source: U.S. Bureau of Labor Statistics; S&P Global Market Intelligence; Fortune; Forbes; Money.com; moneygeek.com; Business Facilities; USA Today; Livability,com; US News; Auburn.edu; Columbus, Georgia Economic Development Note: Southeast defined as AL, AR, FL. GA, KY, LA, MS, NC. SC, TN, VA, and WV - 8th largest Metro Area in the USA - Ranked 10th largest economy in the country - Ranked 13th Best Places for Business and Careers by Forbes - 17 Fortune 500 companies headquartered in Atlanta - Largest market in Alabama, supported by strong steel, biotechnology, and banking industries - Ranked 2nd best US city for job seekers by MoneyGeek - University of Alabama Birmingham serves as an international leader in medicine and dentistry - Voted best place to live in the country by US News - Highest concentration of engineers in the US - Ranked #1 best city for STEM workers by Livability - Home of the Redstone Arsenal which includes the U.S. Space and Rocket Center, NASA’s Marshall Space Flight Center, and the U.S. Army Aviation and Missile Command - Auburn University contributes $5.6 billion annually and 27,000 jobs to the Alabama economy - Named top-five growth city in America by U-Haul - High-tech manufacturing and industrial hub for companies like Kia Motors, Hanwha Cimarron, and Niagara Bottling - Fort Benning Military Base • U.S. Army Infantry and Armor Training Post • Columbus Chamber of Commerce estimates annual economic impact of $4.8 billion - Major companies headquartered include Aflac and Total Systems Services, Inc. - Contains seven colleges and universities, with 83,000 students pursuing degrees in higher education Huntsville, AL Birmingham, AL Atlanta, GA ‘28 Projected Median HHI ($M) ‘23 – ‘28 Projected Population Growth (%) Auburn / Opelika, AL

5 Proven, Veteran Management Team Lynn Joyce SEVP & Chief Financial Officer Greg Smith SEVP & Chief Risk and Credit Officer Jack Swift SEVP & Chief Operating Officer Our senior management team, on average, has more than 25 years of banking experience Mark Chambers CEO and President • 2007-2019 SEVP & President Southeast Region Southern States Bank • 2004-2007 Market President Wachovia Bank • 1998-2004 Commercial Lender Aliant Bank • 1992-2013 EVP & CFO First Financial Bank, a NASDAQ listed Financial Institution • 1986-1992 Arthur Andersen & Co • 2006-2019 SEVP & CCO Southern States Bank • 1986-2006 Credit Admin, Commercial Loan Officer and Market President Regions Bank • 2006-2019 SEVP & President Central Region Southern States Bank • 1996-2006 Senior Vice President Colonial Bank • 1992-1996 Vice President SouthTrust Bank

6 Q3 2023 Results Highlights (1) Please refer to non-U.S. GAAP reconciliation in the appendix (2) Uninsured deposits are 29.66% of total deposits Operating Results Deposits/Liquidity Loans Capital Asset Quality • Net income of $6.6 million, or $0.73 per diluted share, and core net income (1) of $9.6 million, or $1.06 per diluted share (1) • ROAA of 1.15% and ROATCE of 14.21%; Core ROAA (1) of 1.66% and Core ROATCE (1) of 20.50% • Net interest margin of 3.78% • Efficiency ratio (1) of 48.01% and core efficiency ratio (1) of 42.79% • Monthly margin trends – July 3.73%, August 3.83%, and September 3.79% • Loan portfolio of $1.8 billion increased $57.6 million, or 3.4%, from Q2 2023 • Annualized loan growth of 13.3% from Q2 2023 • Average yield on loans of 6.86% improved 25 bps from 6.61% for Q2 2023 • Loans / deposits ratio of 92.58% compared to 89.22% for Q2 2023 • Deposits of $1.9 billion decreased slightly by $7.5 million, or 0.4%, from Q2 2023 (2) • Deposits, excluding brokered deposits, increased by $18.4 million, or 4.2% annualized, from Q2 2023 • Average cost of total deposits increased to 2.63% from 2.38% in Q2 2023 • Noninterest-bearing deposits comprised 21.82% of total deposits compared to 23.36% at Q2 2023 • Nonperforming loans to gross loans of 0.06% remained stable from Q2 2023 • Net charge-offs (recoveries) at ($23,000), or (0.01%) of average loans • Allowance for credit losses to gross loans of 1.25% compared to 1.24% at Q2 2023 • Nonperforming loans increased slightly to $1.1 million from $1.0 million at Q2 2023 • Announced and paid quarterly dividend of $0.09 per share • Tangible common equity to tangible assets (1) of 8.08%, compared to 7.94% at Q2 2023 • Tangible book value per share (1) of $20.84, up 1.6% from Q2 2023

7 Change In Employee Retention Credit Summary During Q2 2023, the Company received a $5.1 million employee retention credit (“ERC”) Q2 2023 results included the $5.1 million ERC in noninterest income and included $1.2 million in noninterest expense for professional fees paid by the Company in obtaining the ERC After reviewing the revised IRS guidelines pertaining to the ERC issued during Q3, the Company determined to return the full $5.1 million ERC to the IRS and has recorded a payable; the Company will also receive a refund of all professional fees totaling $1.2 million related to the ERC Accordingly, Q3 2023 reflects a $5.1 million reduction in noninterest income and a $1.2 million reduction in noninterest expense related to the return of the ERC; this was deemed a change in circumstance between Q2 and Q3 of 2023 The following table eliminates the effect of the ERC; there is no impact on the nine months ended September 30, 2023: Dollars in millions, except for per share data

8 $19.4 $20.9 $19.5 $19.4 $20.7 4.15% 4.38% 4.07% 3.73% 3.78% $16.0 $17.0 $18.0 $19.0 $20.0 $21.0 $22.0 3Q22 4Q22 1Q23 2Q23 3Q23 Net Interest Income Net Interest Margin Net Interest Income and Net Interest Margin Net Interest Margin Source: Company Documents (Dollars in millions)

9 Time Deposits $357.1 Brokered Deposits $168.3 Noninterest-bearing Checking $418.1Interest-bearing Checking $89.7 Money Market $844.7 Savings $38.5 Deposits by Type – $1.92B Deposit Portfolio Source: Company Documents; data as of 9/30/23 (1) Excludes brokered deposits; dollars in thousands Deposit Type Composition % Average Balance Commercial 59% $138.7 Retail 41% $43.5 Account Composition (1) (Dollars in millions)

10 OO-CRE 29.8% NOO-CRE 29.2% C&I 15.0% C & D 12.9% Residential 12.6% Consumer & Other 0.5% Loans by Type $1.78B Loan Portfolio Source: Company Documents; data as of 9/30/23 Loan Type Composition % Fixed 53.3% Variable 46.7% Loan Composition Loan Type Total Office Buildings $190.1 Industrial Warehouse / Heavy Manufacturing $159.6 Convenience Stores $146.3 Retail Warehouse / Light Manufacturing $128.4 Hotels / Motels $101.7 Multi-Family (5+) $93.3 Commercial Retail Building $82.4 Concentration Highlights(Dollars in millions)

11 <$1M 156 $1-5M 35 $5-10M 8 >$10M 2 Office Building Loans $190.1M Loan Portfolio – Office Building Source: Company Documents; data as of 9/30/23 Location Composition % Georgia 71% Alabama 25% Other 4% Loan Composition # of Stories Total Six Stories 3 Five stories 3 Four stories 5 Three stories 9 One & two stories 181 Office Building Type

12 $0.5 $3.9 $13.4 $3.4 $2.0 $2.2 - $1.1 $2.1 $1.8 $3.0 $1.8 $2.0 $2.1 - $2.0 $0.5 $0.6 $4.2 $10.2 $2.9 $2.9 $2.9 0.2% 0.6% 2.5% 1.3% 0.4% 0.3% 0.2%$0.0 $5.0 $10.0 $15.0 $20.0 $25.0 2017 2018 2019 2020 2021 2022 3Q23 Nonaccruals ($mm) TDRs ($mm) OREO ($mm) NPAs / Loans + OREO $20.6 Nonperforming Assets by Type Asset Quality Source: Company Documents Dollars in millions (1) TDRs reflect COVID-19 relief under the CARES Act and bank regulatory COVID-19 relief in 2020 and 2021 Reserves / Loans NCOs / Avg. Loans $6.0 $3.1 $6.3 $15.4 (0.10%) 0.02% 0.57% 0.07% 0.00% $6.9 0.02% Comprehensive and conservative underwriting process Highly experienced bankers incentivized with equity ownership Commitment to a diverse loan portfolio while maintaining strong asset quality metrics Proactively manage loan concentrations with all collateral types capped at approximately 50% of risk- based capital Proactive approach to resolving problem credits 1.02% 1.11% 1.11% 1.22% 1.19% 1.27% 1.25% 2017 2018 2019 2020 2021 2022 3Q23 (0.01%) $7.2 (1)

13 $567 $704 $840 $1,030 $963 $1,241 $1,774 $67 $9 2017 2018 2019 2020 2021 2022 3Q23 $1,587 $1,250 $622 $776 $951 $1,140 $1,556 $1,721 $1,916 2017 2018 2019 2020 2021 2022 3Q23 $736 $888 $1,095 $1,333 $1,774 $1,266 $2,297 $67 $9 2017 2018 2019 2020 2021 2022 3Q23 $2,045 Net Income ($M)Total Deposits ($M) Total Assets ($M) Total Loans ($M) Growth History Source: Company Documents PPP Loans PPP Loans $1,783 $5.6 $7.7 $5.6 $12.1 $18.6 $27.1 $23.1 2017 2018 2019 2020 2021 2022 9M23

14 Building Shareholder Value Our Strategic Focus Maintain focus on strong, profitable organic growth without compromising our credit quality Further grow our core deposit franchise Expand into new markets by hiring commercial bankers Focus on high growth markets and further expanding our Atlanta franchise Evaluate strategic acquisition opportunities Continue implementing technology to optimize customer service and provide efficient opportunities to scale the business Prudently manage capital between balance sheet growth and return to shareholders

15 Near-Term Outlook Loan balances expected to continue to grow at a modest pace Deposit balances expected to grow slightly Net interest income expected to be fairly flat as loans grow, though this will be somewhat offset by net interest margin declines Core noninterest income expected to decline slightly from Q3 2023 Core noninterest expense is expected to be fairly consistent with Q3 2023 Credit metrics are currently strong and future provision levels are expected to consider both current and evolving economic conditions, as well as changes in credit Balanced approach to capital deployment with flexibility to support organic loan growth trajectory and cash dividend while evaluating stock repurchases Well-positioned to capitalize on additional accretive acquisition opportunities

Appendix

17 Non-GAAP Financial Measures Reconciliations

18 Non-GAAP Financial Measures Reconciliations

19 Non-GAAP Financial Measures Reconciliations

20 Non-GAAP Financial Measures Reconciliations