Seacoast Banking Reports Q4 and Full-Year 2025 Results, Buoyed by Balance Sheet Expansion

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Seacoast Banking Reports Q4 and Full-Year 2025 Results, Buoyed by Balance Sheet Expansion

Seacoast Banking Corporation of Florida (NASDAQ: SBCF) reported financial results for the fourth quarter and full year 2025 on Thursday, marked by a significant expansion of the balance sheet after the completion of a major acquisition. While the bank beat revenue expectations, its core results were dampened by merger-related costs and credit conditions linked to its acquisition of Village Bancorporation, Inc. (VBI). After the announcement, Seacoast shares saw a moderate decline in early trading as investors weighed the strong growth in environmental loans against the earnings shortfall.

Transformational Acquisition Drives Scale

A definite highlight of the period was the October 1, 2025, closing of the VBI acquisition. This transaction fundamentally changed the scale of the bank in the Florida market, adding approximately $4.4 billion in assets, $3.5 billion in deposits, and $1.2 billion in loans.

The merger significantly strengthened Seacoast’s presence in high-growth regions, particularly within The Villages community. Management has indicated that while the formal integration is completed, full technology and system transformation is planned for July 2026. To improve the acquired balance sheet, the bank sold approximately $1.5 billion of the $2.5 billion of securities acquired through VBI, reinvesting the proceeds in high-yielding areas with an average yield of 5.3%.

Financial performance and data summary

Seacoast reported fourth-quarter revenue of $34.3 million, which included $18.1 million in merger and acquisition costs. On an adjusted basis – excluding these one-time items – revenue reaches $47.7 million, which is an 18% increase over the same period in 2024.

Key metrics for the fourth quarter of 2025:

Earnings per share (EPS): Reported at $0.44 (adjusted), missing analyst consensus estimate of $0.49–$0.50.
Net Income: Reached $203.3 million, up 43.6% year-over-year, beating expectations of $201.25 million.
Net Interest Margin (NIM): Expanded to 3.44% (excluding interest), an increase of 12 basis points from the previous quarter.
Loan Growth: Total loans reached $12.6 billion; organic loan growth (excluding VBI acquisition) was 15% per year.
Efficiency Ratio: The adjusted efficiency ratio improved to 54.5%, down from 60.0% in the year-ago quarter.

For the full year of 2025, the bank reported an income of $144.9 million. The expansion of the net interest rate has been the main driver, helped by a systematic approach to deposit rates. Deposit costs for the fourth quarter decreased to 1.67%, a decrease of 14 points from the third quarter, reflecting the influx of low-cost funds from the VBI portfolio.

Asset Quality and Financial Position

Despite rapid growth, credit quality remained stable. Non-performing loans fell to 0.57% of total loans, down from 0.90% at the end of 2024. Total borrowing costs were 3 basis points for the quarter.

The bank’s cash position remains strong:

Tier 1 Capital Ratio: 14.4%
Tangible Equity in Tangible Assets: 9.3%
Net Book Value per Share: $17.61, up from $16.12 a year earlier.

The allowance for credit losses increased to 1.42% of gross loans, primarily due to the $23.4 million “day-one” credit provision required under accounting standards for the VBI acquisition.

2026 Strategy and Outlook

Looking ahead, Seacoast management provided an optimistic forecast for the coming fiscal year, targeting significant revenue consolidation from its expanded pipeline. The bank expects to:

Adjusted Revenue Growth: 29% to 31% for the full year 2026.
Adjusted EPS Guidance: $2.48 to $2.52.
Performance Target: Adjusted return on assets (ROA) of 1.30% and return on tangible income (ROTE) of approximately 16% by the end of 2026.

The strategy remains focused on organic growth and diversification of revenue streams. Wealth management assets under management reached $2.8 billion, a 37% year-over-year increase, reflecting a reduced reliance on interest rate spreads.

Market and Great Content

The results come as regional banks in Florida continue to benefit from strong inward migration and a strong local economy. However, Seacoast’s performance highlights an ongoing challenge for mid-tier lenders: balancing strong M&A growth with the immediate impact of merger-related costs and the need to manage deposit costs in an “extremely high” interest rate environment. The market reaction suggests that although the VBI integration strategy is clear, the risk of execution regarding the mid-2026 technology transition remains something to watch for investors.