Market Overview

Seacoast Reports Improvements For The Third Quarter

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STUART, Fla., Oct. 25, 2012 /PRNewswire/ --

Continued acceleration in new households, deposit and fee income growth

  • Total households increase 6.3 percent year over year
  • Strong growth in noninterest bearing deposits of 26.2 percent over prior year
  • Fee based revenues up 20.7 percent year over year

Credit quality improvements continue in the quarter

  • Nonperforming loans decline by 8.3 percent compared to last quarter
  • Other real estate owned down 62.5 percent compared to 2011

Profitability improvement plan announced  

  • Core costs down $727,000 versus second quarter 2012
  • Targeting $7.4 million in cost reduction in 2013

Seacoast Banking Corporation of Florida (NASDAQ-NMS: SBCF), today reported net income for the third quarter of 2012 totaling $447,000, compared to net income of $2,648,000 for the third quarter a year ago.  The net loss for the first nine months of 2012 totaled $950,000, compared to net income of $4,119,000 for 2011. 

(Logo: http://photos.prnewswire.com/prnh/20050916/SEACOASTLOGO )

The net loss that is available to Common shareholders for the third quarter and year to date 2012 totaled $490,000, or $0.01 diluted earnings per share (DEPS) and $3,761,000, or $0.04 DEPS, respectively, compared to net income of $0.02 DEPS and $0.01 DEPS a year ago for the same periods, respectively.

For the first nine months of 2012, net income was impacted by our decision earlier in the year to accelerate the reduction of problem loans and foreclosed properties.  We took this action in part to take advantage of recent improvements in market conditions.  Foreclosed properties were reduced 62.5 percent over the prior year.  Compared to last quarter, nonperforming loans were reduced by 8.3 percent, and are expected to continue to decline over the next two quarters.  Loans classified as restructured fell by 39.3 percent when compared with the prior year and are expected to continue to decline.  Net income for the current quarter was also impacted by nonrecurring charges associated with branch consolidations, staff reductions and other cost reductions as part of our plan to restore higher levels of profitability in 2013.  We expect to book additional one-time charges totaling approximately $1.0 million in the fourth quarter related to branch consolidations.

Profitability Improvement Plan for 2013

During the quarter we completed and began implementing a focused plan to improve profitability in 2013 and beyond.  The plan contains over 100 separate elements designed to achieve meaningful improvements through a balanced focus on expense reductions and revenue enhancements.  Each element aligns with our core strategy and value proposition and has been carefully designed to support and enhance our successful growth initiatives.       

As part of our profitability improvement plan, we completed an evaluation of our overhead structure, and are in the process of implementing reductions in expenses expected to total $7.4 million in 2013.  Approximately $4.9 million of the reduction is related to core operating expenses of which $3.3 million have been implemented and will fully impact the first quarter of 2013.  An additional $1.7 million in reduced annual core operating costs are expected to be implemented in the first and second quarters of 2013.  In addition, we project noncore credit related expenses, primarily losses on OREO and asset disposition expense, will be reduced by $2.5 million in 2013.

The plan also includes revenue and growth initiatives in response to improving market conditions.  These include making additional investments in people to increase our lending capacity in our commercial and business banking lines and expanding growth initiatives related to our mortgage business.  These investments are expected to support an acceleration of our loan production in 2013.  Our successful retail and business deposit growth initiatives have also been expanded to help drive further increases in our households, margins and fees. 

"We intend to bring our expense structure back into line with better performing peers in 2013 as our credit costs continue to abate and as our core expense reductions and expanded revenue growth initiatives take hold," said Dennis S. Hudson, Chief Executive Officer.  "We are pleased with our execution success to date around our growth initiatives as evidenced by our expanding households, acceleration of our mortgage production and recent improvements in business and commercial loan production. We intend to leverage this success with our profit improvement plan to create greater value for shareholders in 2013." 

Total revenues, excluding securities gains, net increased 7.6 percent annualized on a linked quarter basis as a result of improving deposit related fee income, improved deposit mix from the Company's retail and small business deposit growth initiatives, and increased mortgage banking fees from improvements in residential loan production.  Total revenues for the first nine months this year are up $1.1 million compared to the prior year. 





2012



2011



 %
Change



(Dollars in thousands)

Third
Quarter



Third

Quarter





Customer Relationship Funding (Period End)













      Demand deposits (noninterest bearing)

$    409,145



$    324,256



26.2

%

      NOW

420,477



391,318



7.5



      Money market accounts

348,275



327,654



6.3



      Savings accounts

158,208



128,543



23.1



      Time certificates of deposit

343,361



489,503



(29.9)



            Total Deposits

1,679,466



1,661,274



1.1



      Sweep repurchase agreements

122,393



106,562



14.9



      Total core customer funding (1)

1,458,498



1,278,333



14.1



(1) Total deposits and sweep repurchase agreements, excluding certificates of deposits.

Retail and business household growth has improved as a result of the Company's growth initiatives and resources added over the past nine months to attract new commercial loan and business deposit accounts.  New household acquisition was strong again during the third quarter 2012.  New personal retail checking relationships opened during the quarter rose 10.4 percent compared to the same quarter in 2011.  Likewise, new commercial business checking deposit relationships opened increased by 8.7 percent compared with the same quarter one year ago.  Along with the new relationships, our programs have improved market share, increased average services per household and improved customer retention.

Since initial implementation of our retail growth initiatives in 2009, new retail checking deposit households and the average services per household have increased 53.9 percent and 20.5 percent, respectively.  The program has produced significant growth in deposit related fee income, which has increased at an 8.7 percent compounded growth rate since the third quarter of 2010.  The program has also significantly improved deposit mix and lowered the cost of deposits.

Our focused plan to develop our deposit franchise and deepen our residential mortgage  production capacity has produced double digit revenue growth in retail fees, mortgage fees and no cost deposits.  These investments in revenue growth and franchise development together, with new investments in business and commercial revenue growth initiatives, have positioned us to benefit from the improving housing market and economic conditions, which will help offset the negative impacts of much lower asset yields as a result of the Federal Reserve's actions.     

Other results for third quarter 2012:

  • Total revenues (excluding securities gains, net) increased $405,000 linked-quarter to $21.6 million, an increase of 7.6 percent annualized.
  • Service charges on deposits accounts increased 8.9 percent linked-quarter as a result of 7,453 new households over the first nine months, up 20.0 percent compared to last year.
  • Interchange income for the quarter totaled $1,119,000, up $150,000 or 15.5 percent compared to the prior year's results, reflecting the growth in new deposit accounts.
  • Mortgage banking revenues grew as a result of expanded capacity and focused growth initiatives increasing year-over-year by $599,000 or 107.7 percent to $1,155,000 for the quarter.
  • Average checking and savings deposits grew 13.5 percent over the past year.
  • Noninterest bearing checking balances totaled 23.5 percent of average deposits for the third quarter compared with 19.3 percent the prior year.  Noninterest bearing checking balances grew by 26.2 percent over the past year.
  • Total deposits, excluding time deposits over $100,000 and brokered deposits, comprise 91.0 percent of deposits versus 86.0 percent a year ago.  Core deposits grew by 14.0 percent over the past year. 
  • Average cost of deposits totaled 0.26 percent, down 11 basis points from the second quarter of 2012 and 39 basis points lower compared to the prior year. 

Average earning assets are up $54 million from the prior year with average loans up $26 million on retained loan production of $261 million over the last twelve months.  Over the last nine months, retained loan production totaled $198 million. New loan growth has been concentrated in smaller average balance commercial loans and residential home purchase transactions consistent with our concentration management objectives.  Offsetting loan growth has been nonperforming loan resolutions, refinancing and early payoffs as a result of the low rate environment.  Total loans declined to $1.202 billion at September 30, 2012, down $18.9 million compared to the prior quarter impacted by lower nonperforming loans ($4.0 million) and early payoffs of larger commercial loans ($19.7 million).  Early commercial real estate loan payoffs totaled $16.9 million for the third quarter with the average loan size of $4.2 million, further reducing our overall concentration and credit concentration risks.  Total loans (including available for sale) outstanding increased by $15.1 million year-over-year.

The allowance for loan losses remains strong at 1.92 percent compared with 2.02 percent the prior quarter and 2.35 percent the prior year.   The provision for loan losses year to date totals $9.7 million compared to net charge offs of $12.1 million for the first nine months of 2012 and $10.9 million for 2011. 

Nonperforming assets totaled $53.3 million at quarter end, down $3.0 million and $2.4 million compared to both a year earlier and last quarter, respectively.  OREO declined $14.8 million compared to the third quarter 2011 and is the result of improving valuations allowing for more aggressive OREO liquidation activities.  Nonaccrual loans and accruing loans delinquent 90 days or more fell from second quarter 2012 to 3.70 percent of loans.  Early stage delinquencies (accruing loans 30–89 days past due) remained nominal at 0.29 percent of loans outstanding. 

Salary wages and benefits, excluding severance, are higher compared to the prior year's third quarter due to incentive compensation related to improved revenue growth discussed above, and higher health care costs.  Total core operating expenses (total noninterest expense excluding severance, organizational changes, branch closures, net losses on OREO and asset disposition expenses) totaled $18.8 million for the quarter, down $727,000 from the second quarter 2012, but higher by $1.2 million compared to the third quarter 2011.  Organizational changes and branch closures completed during the third quarter are expected to reduce core operating expenses further in 2013.

 

(Dollars in thousands)



Q-3

2012

Q-2

2012

Q-1
2012

Q-4

2011

Q-3

 2011

Noninterest Expense:



























Salaries and wages



$7,442

$7,435

$7,055

$7,301

$6,902

Employee benefits



1,924

1,916

2,010

1,447

1,391

Outsourced data processing costs



1,923

1,834

1,721

1,677

1,685

Telephone / data lines



299

297

289

285

286

Occupancy expense



1,876

1,943

1,882

1,795

1,967

Furniture and equipment expense



556

607

495

525

555

Marketing expense



785

677

926

947

551

Legal and professional fees



1,122

1,637

1,776

1,299

1,496

FDIC assessments



695

707

706

679

687

Amortization of intangibles



196

196

201

212

211

Other



2,018

2,314

2,163

2,264

1,947

   Total Core Operating Expense



18,836

19,563

19,224

18,431

17,678















Severance and organizational changes



839

0

0

0

0

Branch consolidation



232

0

0

0

0

Recovery of prior legal fees



(500)

0

0

0

0

Net loss on OREO



561

790

1,959

1,254

906

Asset dispositions expense



364

368

527

275

479

   Total



$20,332

$20,721

$21,710

$19,960

$19,063

 

Noninterest income, excluding securities gains and losses, increased 35.3 percent annualized when compared to the second quarter, reflecting increased revenues from service charges on deposit accounts, marine finance fees, merchant income, and mortgage banking fees.  As previously indicated, the improvement in market share and programs to grow retail and commercial customer households and investments in future revenue growth initiatives is beginning to produce increased revenues.  We are seeing improvements across our business lines and expect increased momentum beginning in the first quarter 2013.

 

(Dollars in thousands)

Q-3

2012

Q-2

2012

Q-1
2012

Q-4
2011

Q-3

2011

Noninterest Income:























Service charges on deposit accounts

$1,620

$1,487

$1,461

$1,599

$1,675

Trust income

550

564

573

530

541

Mortgage banking fees

1,155

902

623

680

556

Brokerage commissions and fees

247

298

234

258

321

Marine finance fees

279

244

330

333

229

Interchange income

1,119

1,154

1,071

953

969

Other deposit based EFT fees

70

84

99

78

71

Other

639

486

546

452

344



5,679

5,219

4,937

4,883

4,706

Securities gains, net

48

3,615

3,374

1,083

137

Total

$5,727

$8,834

$8,311

$5,966

$4,843

 

The net interest margin stabilized at 3.17 percent in the third quarter 2012 the same compared to the second quarter of 2012 as a result of lower on balance sheet liquidity, better deposit mix and lower costs for interest bearing liabilities.  Interest bearing deposit costs decreased 12 basis points to 0.35 percent in the third quarter 2012 and the total cost of interest bearing liabilities decreased from 0.59 percent for the second quarter to 0.49 percent in the third quarter.  The mix in deposits continues to improve as new households are on-boarded with average checking and savings deposits (excluding all time deposits) rising to 78.7 percent of deposits from 69.5 percent a year ago.  Checking and savings deposits averaged $1.321 billion for the third quarter of 2012, up $157 million or 13.5 percent compared to third quarter 2011.  Total average deposits increased $4.5 million over the year to $1.680 billion with a $152 million decline in average time deposits attributable to the planned runoff of brokered and single service time deposit customers. 

The Company will host a conference call on Friday, October 26, 2012 at 9:00 a.m. (Eastern Time) to discuss its earnings results and business trends.  Investors may call in (toll-free) by dialing (888) 517-2458 (access code: 6117222; leader: Dennis S. Hudson).  Charts will be used during the conference call and may be accessed at the Company's website at www.seacoastbanking.net by selecting Presentations under the heading Investor Services.  A replay of the conference call will be available beginning the afternoon of October 26 by dialing (888) 843-7419 (domestic), using the passcode 6117222.

Alternatively, individuals may listen to the live webcast of the presentation by visiting the Company's website at www.seacoastbanking.net.  The link to the live audio webcast is located in the subsection Presentations under the heading Investor Relations.  Beginning the afternoon of October 26, 2012, an archived version of the webcast can be accessed from this same subsection of the website.  This webcast will be archived and available for one year. 

Seacoast Banking Corporation of Florida has approximately $2.1 billion in assets.  It is one of the largest independent commercial banking organizations in Florida, headquartered on Florida's Treasure Coast, one of the wealthiest and fastest growing areas in the nation.

Cautionary Notice Regarding Forward-Looking Statements

This press release contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including, without limitation, statements about future financial and operating results, ability to realized deferred tax assets, cost savings, enhanced revenues, economic and seasonal conditions in our markets, and improvements to reported earnings that may be realized from cost controls and for integration of banks that we have acquired, as well as statements with respect to Seacoast's objectives, expectations and intentions and other statements that are not historical facts.  Actual results may differ from those set forth in the forward-looking statements.

Forward-looking statements include statements with respect to our beliefs, plans, objectives, goals, expectations, anticipations, estimates and intentions, and involve known and unknown risks, uncertainties and other factors, which may be beyond our control, and which may cause the actual results, performance or achievements of Seacoast to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. You should not expect us to update any forward-looking statements. 

You can identify these forward-looking statements through our use of words such as "may," "will," "anticipate," "assume," "should," "support", "indicate," "would," "believe," "contemplate," "expect," "estimate," "continue," "further", "point to," "project," "could," "intend" or other similar words and expressions of the future.  These forward-looking statements may not be realized due to a variety of factors, including, without limitation: the effects of future economic and market conditions, including seasonality; governmental monetary and fiscal policies, as well as legislative, tax and regulatory changes; changes in accounting policies, rules and practices; the risks of changes in interest rates on the level and composition of deposits, loan demand, liquidity and the values of loan collateral, securities, and interest sensitive assets and liabilities; interest rate risks, sensitivities and the shape of the yield curve; the effects of competition from other commercial banks, thrifts, mortgage banking firms, consumer finance companies, credit unions, securities brokerage firms, insurance companies, money market and other mutual funds and other financial institutions operating in our market areas and elsewhere, including institutions operating regionally, nationally and internationally, together with such competitors offering banking products and services by mail, telephone, computer and the Internet; and the failure of assumptions underlying the establishment of reserves for possible loan losses.  The risks of mergers and acquisitions, include, without limitation: unexpected transaction costs, including the costs of integrating operations; the risks that the businesses will not be integrated successfully or that such integration may be more difficult, time-consuming or costly than expected; the potential failure to fully or timely realize expected revenues and revenue synergies, including as the result of revenues following the merger being lower than expected; the risk of deposit and customer attrition; any changes in deposit mix; unexpected operating and other costs, which may differ or change from expectations; the risks of customer and employee loss and business disruption, including, without limitation, as the result of difficulties in maintaining relationships with employees; increased competitive pressures and solicitations of customers by competitors; as well as the difficulties and risks inherent with entering new markets.

All written or oral forward-looking statements attributable to us are expressly qualified in their entirety by this cautionary notice, including, without limitation, those risks and uncertainties described in our annual report on Form 10-K for the year ended December 31, 2011 under "Special Cautionary Notice Regarding Forward-Looking Statements" and "Risk Factors", and otherwise in our SEC reports and filings.  Such reports are available upon request from the Company, or from the Securities and Exchange Commission, including through the SEC's Internet website at http://www.sec.gov.

 

FINANCIAL  HIGHLIGHTS           (Unaudited)











SEACOAST  BANKING  CORPORATION  OF  FLORIDA  AND  SUBSIDIARIES



























Three Months Ended



Nine Months Ended



(Dollars in thousands,

September 30,



September 30,



   except share data)

2012



2011



2012



2011



Summary of Earnings

















Net income (loss)

$              447



$                2,648



$                      (950)



$          4,119



Net income (loss) available to common shareholders

(490)



1,711



(3,761)



1,308





















Net interest income  (1)

15,995



16,925



48,736



50,039





















Performance Ratios

















Return on average assets-GAAP basis (2), (3)

0.08

%

0.51

%

(0.06)

%

0.27

%

Return on average tangible assets (2), (3), (4)

0.11



0.54



(0.04)



0.30





















Return on average shareholders' equity-GAAP basis (2), (3)

1.09



6.33



(0.76)



3.32





















Net interest margin  (1), (2)

3.17



3.44



3.22



3.43





















Per Share Data

















Net income (loss) diluted-GAAP basis

$            (0.01)



$                  0.02



$                     (0.04)



$            0.01



Net income (loss) basic-GAAP basis

(0.01)



0.02



(0.04)



0.01





















Cash dividends declared

0.00



0.00



0.00



0.00













































September 30,

     Increase/









2012



2011



     (Decrease)



Credit Analysis

















Net charge-offs year-to-date





$      12,106



$     10,885



11.2

%

Net charge-offs to average loans





1.32

%

1.19

%

10.9



Loan loss provision year-to-date





$     9,660



$       1,542



526.4



Allowance to loans at end of period





1.92

%

2.35

%

(18.3)





















Nonperforming loans





$              44,450



$                  32,627



36.2



Other real estate owned





8,888



23,702



(62.5)



Total non-performing assets





$              53,338



$                  56,329



(5.3)





















Restructured loans (accruing)





$              44,179



$                  72,751



(39.3)





















Nonperforming assets to loans and other real

















   estate owned at end of period





4.40

%

4.57

%

(3.7)





















Nonperforming assets to total assets





2.56

%

2.75

%

(6.9)





















Selected Financial Data

















Total assets 





$        2,081,693



$      2,051,037



1.5



Securities available for sale (at fair value)





588,248



611,195



(3.8)



Securities held for investment (at amortized cost)





15,556



24,575



(36.7)



Net loans





1,179,359



1,180,147



(0.1)



Deposits 





1,679,466



1,661,274



1.1



Total shareholders' equity  





167,209



170,793



(2.1)



Common shareholders' equity





118,775



123,608



(3.9)



Book value per share common





1.25



1.31



(4.6)



Tangible book value per share





1.75



1.78



(1.7)



Tangible common book value per share (5)





1.23



1.28



(3.9)



Average shareholders' equity to average assets





7.84

%

8.06

%

(2.7)



Tangible common equity to tangible assets (5), (6)





5.63



5.91



(4.7)





















Average Balances (Year-to-Date)

















Total assets





$       2,118,784



$     2,056,344



3.0



Less: intangible assets





1,988



2,814



(29.4)



Total average tangible assets





$      2,116,796



$    2,053,530



3.1





















Total equity





$         166,066



$    165,781



0.2



Less: intangible assets





1,988



2,814



(29.4)



Total average tangible equity





$        164,078



$    162,967



0.7

























































(1)  Calculated on a fully taxable equivalent basis using amortized cost.

(2)  These ratios are stated on an annualized basis and are not necessarily indicative of future periods.

(3)  The calculation of ROA and ROE do not include the mark-to-market unrealized gains (losses) because the unrealized gains (losses) are not included in net income (loss).

(4)  The Company believes that return on average assets and equity excluding the impacts of noncash amortization expense on intangible assets is a better measurement of the Company's trend in earnings growth.

(5)  The Company defines tangible common equity as total shareholders equity less preferred stock and intangible assets.

(6)  The ratio of tangible common equity to tangible assets is a non-GAAP ratio used by the investment community to measure capital adequacy.

n/m = not meaningful















CONDENSED CONSOLIDATED STATEMENTS OF INCOME            (Unaudited)



SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES



























Three Months Ended



Nine Months Ended





September 30,



September 30,

(Dollars in thousands, except per share data)



2012



2011



2012



2011



















Interest on securities:

















     Taxable



$          3,190



$            4,750



$       10,834



$            13,001

     Nontaxable



21



38



68



123

Interest and fees on loans



14,371



15,315



43,852



47,004

Interest on federal funds sold and other investments



243



175



727



606

         Total Interest Income



17,825



20,278



55,481



60,734



















Interest on deposits



380



605



1,247



1,840

Interest on time certificates



738



2,134



3,371



6,789

Interest on borrowed money



755



671



2,262



2,240

         Total Interest Expense



1,873



3,410



6,880



10,869



















         Net Interest Income



15,952



16,868



48,601



49,865

Provision for loan losses



900



(0)



9,660



1,542

         Net Interest Income After Provision for Loan Losses



15,052



16,868



38,941



48,323



















Noninterest income:

















     Service charges on deposit accounts



1,620



1,675



4,568



4,663

     Trust income



550



541



1,687



1,581

     Mortgage banking fees



1,155



556



2,680



1,460

     Brokerage commissions and fees



247



321



779



864

     Marine finance fees



279



229



853



876

     Interchange income



1,119



969



3,344



2,855

     Other deposit based EFT fees



70



71



253



240

     Other



639



344



1,671



923





5,679



4,706



15,835



13,462

     Securities gains, net



48



137



7,037



137

         Total Noninterest Income



5,727



4,843



22,872



13,599



















Noninterest expenses:

















     Salaries and wages



8,103



6,902



22,593



19,987

     Employee benefits



1,924



1,391



5,850



4,428

     Outsourced data processing costs



1,923



1,685



5,478



4,906

     Telephone / data lines



299



286



885



894

     Occupancy 



2,080



1,967



5,905



5,832

     Furniture and equipment 



570



555



1,672



1,766

     Marketing 



785



551



2,388



1,970

     Legal and professional fees



714



1,496



4,127



4,838

     FDIC assessments



695



687



2,108



2,334

     Amortization of intangibles



196



211



593



635

     Asset dispositions expense



364



479



1,259



2,006

     Net loss on other real estate owned and repossessed assets



561



906



3,310



2,497

     Other 



2,118



1,947



6,595



5,710

         Total Noninterest Expenses



20,332



19,063



62,763



57,803



















         Income (Loss) Before Income Taxes



447



2,648



(950)



4,119

Provision for income taxes



0



0



0



0



















         Net Income (Loss)



447



2,648



(950)



4,119

Preferred stock dividends and accretion on preferred stock discount

937



937



2,811



2,811

         Net Income (Loss) Available to Common Shareholders



$           (490)



$            1,711



$       (3,761)



$              1,308



















Per share of common stock:



































     Net income (loss) diluted



$          (0.01)



$              0.02



$          (0.04)



$                 0.01

     Net income (loss) basic



(0.01)



0.02



(0.04)



0.01

     Cash dividends declared



0.00



0.00



0.00



0.00



















Average diluted shares outstanding



94,567,327



93,878,199



94,471,866



93,611,223

Average basic shares outstanding



93,777,662



93,524,950



93,688,003



93,492,180





































CONDENSED CONSOLIDATED BALANCE SHEETS          (Unaudited)









SEACOAST  BANKING  CORPORATION  OF  FLORIDA  AND  SUBSIDIARIES





















September 30,



December 31,



September 30,

(Dollars in thousands, except share data)

2012



2011



2011















Assets













   Cash and due from banks



$          30,935



$               41,136



$           29,307

   Interest bearing deposits with other banks

141,783



125,945



87,578

            Total  Cash and Cash Equivalents

172,718



167,081



116,885















   Securities:













        Available for sale (at fair value)

588,248



648,362



611,195

        Held for investment (at amortized cost)

15,556



19,977



24,575

            Total Securities 



603,804



668,339



635,770















   Loans available for sale



28,042



6,795



6,897















   Loans, net of deferred costs



1,202,478



1,208,074



1,208,548

   Less: Allowance for loan losses



(23,119)



(25,565)



(28,401)

            Net Loans



1,179,359



1,182,509



1,180,147















   Bank premises and equipment, net



34,884



34,227



34,599

   Other real estate owned



8,888



20,946



23,702

   Other intangible assets



1,697



2,289



2,501

   Other assets



52,301



55,189



50,536





$      2,081,693



$         2,137,375



$    2,051,037















Liabilities and Shareholders' Equity











Liabilities













   Deposits













        Demand deposits (noninterest bearing)

$             409,145



$            328,356



$         324,256

        NOW



420,477



469,631



391,318

        Savings deposits 



158,208



133,578



128,543

        Money market accounts



348,275



319,152



327,654

        Other time certificates



192,297



244,886



257,486

        Brokered time certificates



8,429



4,558



5,252

        Time certificates of $100,000 or more

142,635



218,580



226,765

            Total Deposits



1,679,466



1,718,741



1,661,274















   Federal funds purchased and securities sold under











       agreements to repurchase, maturing within 30 days

122,393



136,252



106,562

    Borrowed funds



50,000



50,000



50,000

    Subordinated debt



53,610



53,610



53,610

    Other liabilities



9,015



8,695



8,798





1,914,484



1,967,298



1,880,244















Shareholders' Equity













    Preferred stock - Series A



48,434



47,497



47,185

    Common stock



9,481



9,469



9,470

    Additional paid in capital



222,744



222,048



221,797

    Accumulated deficit



(117,914)



(114,152)



(115,764)

    Treasury stock



(101)



(13)



(6)





162,644



164,849



162,682

    Accumulated other comprehensive gain, net

4,565



5,228



8,111

            Total Shareholders' Equity



167,209



170,077



170,793





$          2,081,693



$         2,137,375



$      2,051,037















Common Shares Outstanding



94,810,684



94,686,801



94,696,906















Note:  The balance sheet at December 31, 2011 has been derived from the audited financial statements at that date.

CONSOLIDATED QUARTERLY FINANCIAL  DATA          (Unaudited)











SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES

































QUARTERS







2012



2011

Last 12



(Dollars in thousands,
  except per share data)

Third

Second

First



Fourth

Months 



Net income

$                447



$          (2,335)



$                938



$              2,548



$                  1,598

























Operating Ratios





















   Return on average assets-GAAP basis (2),(3)

0.08

%

(0.44)

%

0.18

%

0.48

%

0.08

%

   Return on average tangible assets (2),(3),(4)

0.11



(0.42)



0.20



0.51



0.10

























   Return on average shareholders' equity-GAAP basis (2),(3)

1.09



(5.56)



2.26



6.17



0.97

























   Net interest margin (1),(2)

3.17



3.17



3.33



3.42



3.27



   Average equity to average assets

7.77



7.90



7.85



7.86



7.84

























Credit Analysis





















   Net charge-offs

$             2,416



$           6,275



$            3,415



$              3,268



$                15,374



   Net charge-offs to average loans

0.79

%

2.05

%

1.13

%

1.07

%

1.26

%

   Loan loss provision

$                900



$           6,455



$            2,305



$                 432



$                10,092



   Allowance to loans at end of period

1.92

%

2.02

%

2.01

%

2.12

%



























  Restructured loans (accruing)

$          44,179



54,842



57,665



71,611





























   Nonperforming loans

$          44,450



48,482



41,716



28,526







   Other real estate owned

8,888



7,219



15,530



20,946







   Nonperforming assets

$          53,338



$         55,701



$          57,246



$           49,472







   Nonperforming assets to loans and other





















       real estate owned at end of period

4.40

%

4.53

%

4.65

%

4.03

%





   Nonperforming assets to total assets

2.56



2.64



2.64



2.31







   Nonaccrual loans and accruing loans 90 days or more





















       past due to loans outstanding at end of period

3.70



3.97



3.43



2.36





























Per Share Common Stock





















   Net income (loss) diluted-GAAP basis

$             (0.01)



$            (0.03)



$               0.00



$                0.02



$                  (0.02)



   Net income (loss) basic-GAAP basis

(0.01)



(0.03)



0.00



0.02



$                  (0.02)

























   Cash dividends declared

-



-



-



-



$                         -



   Book value per share common

1.25



1.24



1.30



1.29





























Average Balances





















Total assets

$     2,096,694



$    2,133,713



$     2,126,186



$      2,085,466







Less: Intangible assets

1,793



1,988



2,184



2,392







Total average tangible assets

$     2,094,901



$    2,131,725



$     2,124,002



$      2,083,074





























Total equity

$        162,902



$       168,457



$        166,874



$         163,857







Less: Intangible assets

1,793



1,988



2,184



2,392







Total average tangible equity

$        161,109



$       166,469



$        164,690



$         161,465





























(1) Calculated on a fully taxable equivalent basis using amortized cost.









(2) These ratios are stated on an annualized basis and are not necessarily indicative of future periods.



(3) The calculation of ROA and ROE do not include the mark-to-market unrealized gains (losses), because the unrealized gains (losses) are not included in net income (loss).



(4) The Company believes that return on average assets and equity excluding the impacts of noncash amortization expense on intangible assets is a better measurement of the Company's trend in earnings growth.

























































September 30,



December 31,



September 30,



SECURITIES 









2012



2011



2011

























U.S. Treasury and U.S. Government Agencies









$            1,711



$              1,724



$                  4,226



Mortgage-backed









585,632



645,471



603,089



Obligations of states and political subdivisions









905



1,167



1,158



Other securities









0



0



2,722



   Securities Available for Sale









588,248



648,362



611,195

























Mortgage-backed









7,397



12,315



16,117



Obligations of states and political subdivisions









6,659



6,662



7,458



Other securities









1,500



1,000



1,000



   Securities Held for Investment









15,556



19,977



24,575



       Total Securities









$        603,804



$         668,339



$             635,770

























































September 30,



December 31,

September 30,



LOANS









2012



2011

2011



Construction and land development









$          56,213



$           49,184



$                47,653



Real estate mortgage









1,036,224



1,054,599



1,055,276



Installment loans to individuals









51,564



50,611



51,736



Commercial and financial









58,222



53,105



53,534



Other loans









255



575



349



       Total Loans









$     1,202,478



$      1,208,074



$          1,208,548















































AVERAGE BALANCES, YIELDS AND RATES (1)             (Unaudited)











SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES































2012



2011







Third Quarter



Second Quarter



Third Quarter



Average

Yield/

Average

Yield/

Average

Yield/

(Dollars in thousands)

Balance

Rate



Balance

Rate



Balance

Rate





















Assets



















Earning assets:



















    Securities:



















         Taxable

$              572,328

2.23

%

$                552,501

2.40

%

$            624,811

3.04

%

         Nontaxable 

1,972

6.48



2,055

6.81



3,392

6.72



                   Total Securities

574,300

2.24



554,556

2.41



628,203

3.06























    Federal funds sold and other



















         investments

209,461

0.46



248,944

0.43



127,072

0.54























    Loans,  net

1,223,313

4.68



1,231,239

4.81



1,197,686

5.09























                  Total Earning Assets

2,007,074

3.54



2,034,739

3.63



1,952,961

4.13























Allowance for loan losses

(24,807)





(23,677)





(30,666)





Cash and due from banks

29,227





31,795





27,044





Premises and equipment

35,003





34,197





34,782





Other assets

50,197





56,659





70,735



























$           2,096,694





$             2,133,713





$         2,054,856













































Liabilities and Shareholders' Equity



















Interest-bearing liabilities:



















      NOW (2)

$              419,007

0.15

%

$                423,240

0.16

%

$            394,399

0.24

%

      Savings deposits 

157,577

0.11



152,333

0.10



126,800

0.11



      Money market accounts (2)

350,213

0.21



336,392

0.26



320,683

0.41



      Time deposits

358,504

0.82



406,292

1.12



510,755

1.66



      Federal funds purchased and 



















        other short term borrowings

140,932

0.24



146,510

0.25



99,311

0.27



      Other borrowings

103,610

2.57



103,610

2.55



103,610

2.31























                     Total Interest-Bearing Liabilities

1,529,843

0.49



1,568,377

0.59



1,555,558

0.87























Demand deposits (noninterest-bearing)

394,467





388,060





322,646





Other liabilities

9,482





8,819





10,807





                     Total Liabilities 

1,933,792





1,965,256





1,889,011

























Shareholders' equity

162,902





168,457





165,845



























$           2,096,694





$             2,133,713





$         2,054,856

























Interest expense as a % of earning assets  



0.37

%



0.45

%



0.69

%

Net interest income as a % of earning assets  



3.17





3.17





3.44































































(1) On a fully taxable equivalent basis.  All yields and rates have been computed on an annualized basis using amortized cost. Fees on loans have been included in interest on loans. Nonaccrual loans are included in loan balances.

(2) Certain reclassifications have been made to prior years' presentations to conform to the current year presentation.





















CONSOLIDATED QUARTERLY FINANCIAL  DATA           (Unaudited)









SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES







































2012



2011

(Dollars in thousands)



Third Quarter



Second Quarter



First Quarter



Fourth Quarter



Third Quarter

























Customer Relationship Funding (Period End)



















      Demand deposits (noninterest bearing)



$            409,145



$         393,681



$         394,532



$         328,356



$         324,256

      NOW accounts



420,477



420,449



436,712



469,631



391,318

      Money market accounts



348,275



346,191



330,409



319,152



327,654

      Savings accounts



158,208



156,019



148,068



133,578



128,543

      Time certificates of deposit



343,361



373,244



427,738



468,024



489,503

            Total Deposits



1,679,466



1,689,584



1,737,459



1,718,741



1,661,274

























      Sweep repurchase agreements



122,393



139,489



149,316



136,252



106,562

      Total core customer funding (1)



1,458,498



1,455,829



1,459,037



1,386,969



1,278,333

















































(1) Total deposits and sweep repurchase agreements, excluding certificates of deposits.





QUARTERLY TRENDS - LOANS AT END OF PERIOD (Dollars in Millions)     (Unaudited)



SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES





























2011



2012



1st Qtr

2nd Qtr

3rd Qtr

 4th Qtr 



1st Qtr

2nd Qtr

3rd Qtr

Construction and land development

















   Residential

















      Condominiums

$           0.5

$            -

$            -

-



$          -

$            -

$            -

      Townhomes

-

-

-

-



-

-

-

      Single family residences

-

-

-

-



-

-

-

      Single family land and lots

6.6

6.5

6.4

6.2



6.0

5.9

5.8

      Multifamily

6.1

5.7

5.5

5.1



4.9

4.7

4.6



13.2

12.2

11.9

11.3



10.9

10.6

10.4

   Commercial

















      Office buildings

-

-

-

0.2



0.3

-

-

      Retail trade

-

-

-

-



-

-

-

      Land

33.9

10.3

10.2

9.3



9.2

10.7

9.8

      Industrial

-

-

-

-



-

-

-

      Healthcare

-

-

-

-



-

-

-

      Churches and educational facilities

-

-

-

0.1



0.3

0.3

0.7

      Lodging

-

-

-

-



-

-

-

      Convenience stores

0.5

0.6

0.6

1.7



1.4

1.4

-

      Marina

-

-

-

-



-

-

-

      Other

-

-

-

-



-

-

-



34.4

10.9

10.8

11.3



11.2

12.4

10.5

   Individuals

















      Lot loans

20.8

19.4

18.6

17.9



18.4

17.6

16.4

      Construction

7.3

6.7

6.4

8.7



13.5

16.6

18.9



28.1

26.1

25.0

26.6



31.9

34.2

35.3

   Total construction and land development

75.7

49.2

47.7

49.2



54.0

57.2

56.2



















Real estate mortgages

















   Residential real estate

















      Adjustable

308.6

314.3

324.4

334.1



341.6

359.4

353.7

      Fixed rate

86.6

88.8

92.8

97.0



96.2

95.4

99.7

      Home equity mortgages

67.7

63.1

63.6

60.2



59.5

58.3

58.4

      Home equity lines

57.4

56.9

55.1

54.9



53.0

50.8

50.6



520.3

523.1

535.9

546.2



550.3

563.9

562.4

   Commercial real estate

















      Office buildings

121.3

120.0

122.0

119.6



118.0

113.4

102.4

      Retail trade

150.6

149.6

146.1

140.6



139.3

128.5

121.1

      Industrial

76.3

68.5

72.5

70.7



70.0

72.0

71.3

      Healthcare

26.6

26.3

29.6

38.8



40.2

42.0

35.8

      Churches and educational facilities

28.6

28.2

27.8

27.4



27.0

26.7

26.2

      Recreation

2.8

2.8

2.7

3.2



3.1

3.1

2.7

      Multifamily

14.2

16.8

15.4

9.4



8.8

8.3

7.8

      Mobile home parks

2.5

2.4

2.2

2.2



2.1

2.1

2.1

      Lodging

21.7

20.0

19.8

19.6



19.4

19.3

19.1

      Restaurant

4.2

4.3

4.3

4.7



4.6

4.7

4.4

      Agricultural

9.2

9.2

8.9

8.8



7.6

7.4

7.3

      Convenience stores

20.1

20.0

19.8

15.1



15.5

15.4

16.6

      Marina

21.7

21.5

21.4

21.3



21.6

21.5

21.4

      Other

27.4

27.3

26.9

27.0



29.3

29.3

35.6



527.2

516.9

519.4

508.4



506.5

493.7

473.8

   Total real estate mortgages

1,047.5

1,040.0

1,055.3

1,054.6



1,056.8

1,057.6

1,036.2



















Commercial & financial

51.5

48.0

53.5

53.1



54.6

56.2

58.2



















Installment loans to individuals

















      Automobile and trucks

10.1

9.5

9.2

8.7



8.2

8.1

8.0

      Marine loans

19.4

20.2

21.6

19.9



21.1

20.8

23.0

      Other

20.9

21.6

20.9

22.0



21.5

21.3

20.6



50.4

51.3

51.7

50.6



50.8

50.2

51.6



















Other

0.3

0.4

0.3

0.6



0.2

0.2

0.3



$    1,225.4

$   1,188.9

$   1,208.5

1,208.1



1,216.4

1,221.4

1,202.5



















QUARTERLY TRENDS - INCREASE (DECREASE) IN LOANS BY QUARTER (Dollars in Millions) (Unaudited)

SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES

























2011



2012



1st Qtr

2nd Qtr

3rd Qtr

4th Qtr



1st Qtr

2nd Qtr

3rd Qtr