Document

Second Quarter 2024 Performance and Operational Highlights

•Net income of $8.2 million, or $0.90 per diluted share

•Core net income(1) of $9.1 million, or $1.00 per diluted share(1)

•Net interest income of $21.6 million, an increase of $740,000 from the prior quarter

•Net interest margin (“NIM”) of 3.56%, down 3 basis points from the prior quarter

•NIM of 3.57% on a fully-taxable equivalent basis (“NIM - FTE”)(1)

•Return on average assets (“ROAA”) of 1.29%; return on average stockholders’ equity (“ROAE”) of 14.55%; and return on average tangible common equity (“ROATCE”)(1) of 15.79%

•Core ROAA(1) of 1.43%; and core ROATCE(1) of 17.44%

•Efficiency ratio of 49.78%; and core efficiency ratio of 44.75%

•Linked-quarter loans grew 10.3% annualized

•Linked-quarter total deposits grew 12.6% annualized

•Linked-quarter total deposits, excluding brokered deposits, grew 15.2% annualized

(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., July 22, 2024 – 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 $8.2 million, or $0.90 diluted earnings per share, for the second quarter of 2024. This compares to net income of $8.1 million, or $0.90 diluted earnings per share, for the first quarter of 2024, and net income of $8.8 million, or $0.98 diluted earnings per share, for the second quarter of 2023. The Company reported core net income of $9.1 million, or $1.00 diluted core earnings per share, for the second quarter of 2024. This compares to core net income of $8.1 million, or $0.90 diluted core earnings per share, for the first quarter of 2024, and core net income of $7.1 million, or $0.79 diluted core earnings per share, for the second quarter of 2023 (see “Reconciliation of Non-GAAP Financial Measures”).

CEO Commentary

Mark Chambers, Chief Executive Officer and President of Southern States said, “We generated consistent growth in the second quarter with continued progress in business development adding high-quality loans and core deposits. We are seeing well-balanced loan growth across all our major areas of lending. Our total loan growth of 10.3% (annualized from the prior quarter) and total deposit growth of 12.6% reflected our ability to perform well through economic cycles.”

“We continue to be a high-performing bank with strong profitability metrics including ROATCE of 15.79%. Effective expense management resulted in our second highest core efficiency ratio of 44.75%.”

“Consistent with our prudent approach to risk management, we have a strong and durable foundation with high levels of capital reserves and strong credit quality. The addition of CBB Bancorp, which we expect to close on August 1, will strengthen our platform, drive loan and deposit growth, and expand our franchise in growing and attractive Georgia markets. Our two organizations are culturally aligned with a ‘Customer First’ mindset and we are excited to realize all the synergies that will benefit our customers, employees, shareholders, and the communities we serve.”


	Three Months Ended						% Change June 30, 2024 vs.
	June 30, 2024		March 31, 2024		June 30, 2023		March 31, 2024		June 30, 2023
	(Dollars in thousands)

Service charges on deposit accounts	$	462	$	463	$	456	(0.2)	%	1.3	%
Swap fees	4		15		173		(73.3)	%	(97.7)	%
SBA/USDA fees	58		64		66		(9.4)	%	(12.1)	%
Mortgage origination fees	92		96		188		(4.2)	%	(51.1)	%
Net gain (loss) on securities	20		(12)		(45)		(266.7)	%	(144.4)	%
Employee retention credit and related revenue (“ERC”)	—		—		5,100		N/A		N/A
Other operating income	732		642		924		14.0	%	(20.8)	%
Total noninterest income	$	1,368	$	1,268	$	6,862	7.9	%	(80.1)	%

Relative to the second quarter of 2023, noninterest income decreased 80.1% from $6.9 million. In the second quarter of 2023, the Company received $5.1 million in ERC from the Internal Revenue Service (“IRS”), which was subsequently returned in the third quarter of 2023 as a result of revised IRS eligibility guidelines. Other operating income decreased as a result of the Company receiving less nonrecurring income from a third party during the second quarter of 2024. In addition, there was a decline in swap fees during the second quarter of 2024, substantially as a result of the Company not participating in any swap transactions.

Relative to the second quarter of 2023, noninterest expense decreased 15.0% from $13.4 million. The decrease was primarily attributable to a decrease in salaries and benefits, substantially as a result of one-time retirement-related expenses of $1.6 million paid to our former CEO in May 2023 and professional fees paid to a third party during the second quarter of 2023 related to ERC, which were subsequently refunded during the third quarter of 2023. These decreases were significantly offset by the wire fraud loss the Company incurred during the second quarter of 2024. As previously mentioned, this was not a systematic issue with systems, only a procedural incident.


	Three Months Ended									% Change June 30, 2024 vs.
	June 30, 2024			March 31, 2024			June 30, 2023			March 31, 2024		June 30, 2023
	(Dollars in thousands)

Gross loans	$	2,021,877		$	1,971,396		$	1,722,278		2.6	%	17.4	%
Unearned income	(6,443)			(6,247)			(5,766)			3.1	%	11.7	%
Loans, net of unearned income (“Loans”)	2,015,434			1,965,149			1,716,512			2.6	%	17.4	%
Average loans, net of unearned (“Average loans”)	$	1,987,533		$	1,916,288		$	1,676,816		3.7	%	18.5	%

Nonperforming loans (“NPL”)	$	3,784		$	3,446		$	1,010		9.8	%	274.7	%
Provision for credit losses	$	1,067		$	1,236		$	1,557		(13.7)	%	(31.5)	%
Allowance for credit losses (“ACL”)	$	25,828		$	25,144		$	21,385		2.7	%	20.8	%
Net charge-offs	$	383		$	470		$	27		(18.5)	%	1318.5	%
NPL to gross loans	0.19		%	0.17		%	0.06		%
Net charge-offs to average loans(1)	0.08		%	0.10		%	0.01		%
ACL to loans	1.28		%	1.28		%	1.25		%

(1) Ratio is annualized.

Nonperforming loans totaled $3.8 million, or 0.19% of gross loans, at June 30, 2024, compared with $3.4 million, or 0.17% of gross loans, at March 31, 2024, and $1.0 million, or 0.06% of gross loans, at June 30, 2023. The $338,000 net increase in nonperforming loans in the second quarter of 2024 was primarily attributable to a commercial and industrial loan that was added to nonaccrual status and partially offset by a commercial and industrial loan that was charged-off. The $2.8 million net increase in nonperforming loans from June 30, 2023, was primarily attributable to a significant commercial real estate loan and two commercial and industrial loans that were added to nonaccrual status.

Net charge-offs for the second quarter of 2024 were $383,000, or 0.08% of average loans on an annualized basis, compared to net charge-offs of $470,000, or 0.10% of average loans on an annualized basis, for the first quarter of 2024, and net charge-offs of $27,000, or 0.01% of average loans on an annualized basis, for the second quarter of 2023. The charge-offs recorded during the the first and second quarters of 2024 were substantially related to the charge-off of approximately 70% of a purchased pool of consumer loans, as the borrower has filed for bankruptcy. This was a conservative approach based on uncertainty.

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, 2023 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 our acquisition of Century Bank of Georgia, business strategy and prospects for growth, operations, ability to pay dividends, competition, regulation and general economic conditions.


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

	Three Months Ended									Six Months Ended
	June 30, 2024			March 31, 2024			June 30, 2023			June 30, 2024			June 30, 2023

Results of Operations
Interest income	$	41,007		$	38,736		$	32,185		$	79,743		$	60,884
Interest expense	19,428			17,897			12,753			37,325			21,906
Net interest income	21,579			20,839			19,432			42,418			38,978
Provision for credit losses	1,067			1,236			1,557			2,303			2,738
Net interest income after provision	20,512			19,603			17,875			40,115			36,240
Noninterest income	1,368			1,268			6,862			2,636			8,648
Noninterest expense	11,411			10,375			13,432			21,786			23,590
Income tax expense	2,271			2,377			2,549			4,648			4,871
Net income	$	8,198		$	8,119		$	8,756		$	16,317		$	16,427
Core net income(1)	$	9,058		$	8,128		$	7,058		$	17,186		$	14,339

Share and Per Share Data
Shares issued and outstanding	8,908,130			8,894,794			8,738,814			8,908,130			8,738,814
Weighted average shares outstanding:
Basic	8,957,608			8,913,477			8,763,635			8,935,542			8,763,046
Diluted	9,070,568			9,043,122			8,950,847			9,062,548			9,001,600
Earnings per share:
Basic	$	0.91		$	0.91		$	1.00		$	1.82		$	1.87
Diluted	0.90			0.90			0.98			1.80			1.82
Core - diluted(1)	1.00			0.90			0.79			1.90			1.59
Book value per share	25.88			25.06			22.57			25.88			22.57
Tangible book value per share(1)	23.91			23.07			20.52			23.91			20.52
Cash dividends per common share	0.09			0.09			0.09			0.18			0.18

Performance and Financial Ratios
ROAA	1.29		%	1.33		%	1.60		%	1.31		%	1.56		%
ROAE	14.55		%	14.87		%	18.15		%	14.71		%	17.43		%
Core ROAA(1)	1.43		%	1.34		%	1.29		%	1.38		%	1.36		%
ROATCE(1)	15.79		%	16.17		%	20.01		%	15.98		%	19.25		%
Core ROATCE(1)	17.44		%	16.19		%	16.13		%	16.83		%	16.80		%
NIM	3.56		%	3.59		%	3.73		%	3.57		%	3.89		%
NIM - FTE(1)	3.57		%	3.60		%	3.74		%	3.58		%	3.90		%
Net interest spread	2.59		%	2.63		%	2.86		%	2.60		%	3.08		%
Yield on loans	7.17		%	7.06		%	6.61		%	7.11		%	6.50		%
Yield on interest-earning assets	6.76		%	6.67		%	6.17		%	6.71		%	6.08		%
Cost of interest-bearing liabilities	4.17		%	4.04		%	3.31		%	4.11		%	3.00		%
Cost of funds(2)	3.41		%	3.27		%	2.58		%	3.34		%	2.31		%
Cost of interest-bearing deposits	4.07		%	3.92		%	3.12		%	4.00		%	2.79		%
Cost of total deposits	3.27		%	3.12		%	2.38		%	3.20		%	2.11		%
Noninterest deposits to total deposits	19.12		%	19.75		%	23.36		%	19.12		%	23.36		%
Core deposits to total deposits	81.78		%	81.45		%	86.43		%	81.78		%	86.43		%
Uninsured deposits to total deposits	29.66		%	28.92		%	28.75		%	29.66		%	28.75		%
Total loans to total deposits	92.63		%	93.14		%	89.22		%	92.63		%	89.22		%
Efficiency ratio	49.78		%	46.90		%	51.00		%	48.36		%	50.02		%
Core efficiency ratio(1)	44.75		%	46.90		%	49.96		%	45.81		%	49.38		%


SELECT FINANCIAL DATA
(Dollars in thousands)

	Three Months Ended									Six Months Ended
	June 30, 2024			March 31, 2024			June 30, 2023			June 30, 2024			June 30, 2023

Financial Condition (ending)
Total loans	$	2,015,434		$	1,965,149		$	1,716,512		$	2,015,434		$	1,716,512
Total securities	204,131			197,006			182,717			204,131			182,717
Total assets	2,572,011			2,510,975			2,277,803			2,572,011			2,277,803
Total noninterest-bearing deposits	416,068			416,704			449,433			416,068			449,433
Total core deposits(1)	1,779,253			1,718,333			1,662,855			1,779,253			1,662,855
Total deposits	2,175,678			2,109,798			1,923,911			2,175,678			1,923,911
Total borrowings	136,873			146,773			131,472			136,873			131,472
Total liabilities	2,341,430			2,288,094			2,080,553			2,341,430			2,080,553
Total shareholders’ equity	230,581			222,881			197,250			230,581			197,250

Financial Condition (average)
Total loans	$	1,987,533		$	1,916,288		$	1,676,816		$	1,951,910		$	1,643,376
Total securities	210,678			208,954			196,731			209,816			194,552
Total other interest-earning assets	242,214			211,127			218,451			226,671			182,447
Total interest-earning assets	2,440,425			2,336,369			2,091,998			2,388,397			2,020,375
Total assets	2,553,010			2,447,278			2,200,843			2,500,144			2,129,328
Total noninterest-bearing deposits	420,885			416,141			438,987			418,513			438,862
Total interest-bearing deposits	1,729,682			1,633,307			1,412,047			1,681,494			1,356,648
Total deposits	2,150,567			2,049,448			1,851,034			2,100,007			1,795,510
Total borrowings	143,189			148,771			131,411			145,980			118,229
Total interest-bearing liabilities	1,872,871			1,782,078			1,543,458			1,827,474			1,474,877
Total shareholders’ equity	226,527			219,622			193,516			223,075			190,096

Asset Quality
Nonperforming loans	$	3,784		$	3,446		$	1,010		$	3,784		$	1,010
Other real estate owned (“OREO”)	$	33		$	33		$	2,870		$	33		$	2,870
Nonperforming assets (“NPA”)	$	3,817		$	3,479		$	3,880		$	3,817		$	3,880
Net charge-offs to average loans(2)	0.08		%	0.10		%	0.01		%	0.09		%	0.03		%
Provision for credit losses to average loans(2)	0.22		%	0.26		%	0.37		%	0.24		%	0.34		%
ACL to loans	1.28		%	1.28		%	1.25		%	1.28		%	1.25		%
ACL to gross loans	1.28		%	1.28		%	1.24		%	1.28		%	1.24		%
ACL to NPL	682.56		%	729.66		%	2117.33		%	682.56		%	2117.33		%
NPL to loans	0.19		%	0.18		%	0.06		%	0.19		%	0.06		%
NPL to gross loans	0.19		%	0.17		%	0.06		%	0.19		%	0.06		%
NPA to gross loans and OREO	0.19		%	0.18		%	0.22		%	0.19		%	0.22		%
NPA to total assets	0.15		%	0.14		%	0.17		%	0.15		%	0.17		%

Regulatory and Other Capital Ratios
Total shareholders’ equity to total assets	8.97		%	8.88		%	8.66		%	8.97		%	8.66		%
Tangible common equity to tangible assets(3)	8.34		%	8.23		%	7.94		%	8.34		%	7.94		%
Tier 1 capital ratio to average assets	8.72		%	8.79		%	8.70		%	8.72		%	8.70		%
Risk-based capital ratios:
CET1 capital ratio	9.54		%	9.39		%	9.11		%	9.54		%	9.11		%
Tier 1 capital ratio	9.54		%	9.39		%	9.11		%	9.54		%	9.11		%
Total capital ratio	14.50		%	14.42		%	14.42		%	14.50		%	14.42		%


CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(Dollars in thousands)

	June 30, 2024		March 31, 2024		December 31, 2023		June 30, 2023
	(Unaudited)		(Unaudited)		(Audited)		(Unaudited)

Assets
Cash and due from banks	$	21,598	$	20,470	$	19,710	$	21,299
Interest-bearing deposits in banks	140,440		129,917		134,846		159,818
Federal funds sold	76,334		86,736		96,095		84,812
Total cash and cash equivalents	238,372		237,123		250,651		265,929

Securities available for sale, at fair value	184,510		177,379		179,000		163,075
Securities held to maturity, at amortized cost	19,621		19,627		19,632		19,642
Other equity securities, at fair value	3,658		3,638		3,649		3,762
Restricted equity securities, at cost	4,633		5,108		5,684		3,862
Loans held for sale	1,716		425		450		1,589

Loans, net of unearned income	2,015,434		1,965,149		1,884,508		1,716,512
Less allowance for credit losses	25,828		25,144		24,378		21,385
Loans, net	1,989,606		1,940,005		1,860,130		1,695,127

Premises and equipment, net	26,192		26,262		26,426		26,957
Accrued interest receivable	9,654		9,561		8,711		7,372
Bank owned life insurance	33,000		30,075		29,884		29,521
Annuities	15,918		15,939		15,036		15,359
Foreclosed assets	33		33		33		2,870
Goodwill	16,862		16,862		16,862		16,862
Core deposit intangible	735		817		899		1,062
Other assets	27,501		28,121		29,616		24,814

Total assets	$	2,572,011	$	2,510,975	$	2,446,663	$	2,277,803

Liabilities and Stockholders' Equity
Liabilities:
Deposits:
Noninterest-bearing	$	416,068	$	416,704	$	437,959	$	449,433
Interest-bearing	1,759,610		1,693,094		1,580,230		1,474,478
Total deposits	2,175,678		2,109,798		2,018,189		1,923,911

Other borrowings	8,000		7,997		26,994		(13)
FHLB advances	42,000		52,000		70,000		45,000
Subordinated notes	86,873		86,776		86,679		86,485
Accrued interest payable	2,024		1,805		1,519		1,063
Other liabilities	26,855		29,718		28,318		24,107

Total liabilities	2,341,430		2,288,094		2,231,699		2,080,553

Stockholders' equity:
Common stock	44,813		44,746		44,479		43,831
Capital surplus	79,248		79,282		78,361		77,101
Retained earnings	117,233		109,838		102,523		88,603
Accumulated other comprehensive loss	(8,333)		(8,401)		(8,379)		(10,799)
Unvested restricted stock	(826)		(1,030)		(466)		(709)
Vested restricted stock units	(1,554)		(1,554)		(1,554)		(777)

Total stockholders' equity	230,581		222,881		214,964		197,250

Total liabilities and stockholders' equity	$	2,572,011	$	2,510,975	$	2,446,663	$	2,277,803


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

	Three Months Ended						Six Months Ended
	June 30, 2024		March 31, 2024		June 30, 2023		June 30, 2024		June 30, 2023
	(Unaudited)		(Unaudited)		(Unaudited)		(Unaudited)		(Unaudited)
Interest income:
Loans, including fees	$	35,421	$	33,628	$	27,630	$	69,049	$	52,965
Taxable securities	2,039		1,981		1,641		4,020		3,024
Nontaxable securities	231		229		228		460		519
Other interest and dividends	3,316		2,898		2,686		6,214		4,376
Total interest income	41,007		38,736		32,185		79,743		60,884

Interest expense:
Deposits	17,511		15,906		10,998		33,417		18,766
Other borrowings	1,917		1,991		1,755		3,908		3,140
Total interest expense	19,428		17,897		12,753		37,325		21,906

Net interest income	21,579		20,839		19,432		42,418		38,978
Provision for credit losses	1,067		1,236		1,557		2,303		2,738
Net interest income after provision for credit losses	20,512		19,603		17,875		40,115		36,240

Noninterest income:
Service charges on deposit accounts	462		463		456		925		906
Swap fees	4		15		173		19		169
SBA/USDA fees	58		64		66		122		200
Mortgage origination fees	92		96		188		188		288
Net gain (loss) on securities	20		(12)		(45)		8		469
Employee retention credit and related revenue	—		—		5,100		—		5,100
Other operating income	732		642		924		1,374		1,516
Total noninterest income	1,368		1,268		6,862		2,636		8,648

Noninterest expenses:
Salaries and employee benefits	6,112		6,231		7,863		12,343		14,174
Equipment and occupancy expenses	667		689		694		1,356		1,377
Data processing fees	686		643		646		1,329		1,239
Regulatory assessments	375		360		180		735		522
Professional fees related to ERC	—		—		1,243		—		1,243
Other operating expenses	3,571		2,452		2,806		6,023		5,035
Total noninterest expenses	11,411		10,375		13,432		21,786		23,590

Income before income taxes	10,469		10,496		11,305		20,965		21,298

Income tax expense	2,271		2,377		2,549		4,648		4,871

Net income	$	8,198	$	8,119	$	8,756	$	16,317	$	16,427

Basic earnings per share	$	0.91	$	0.91	$	1.00	$	1.82	$	1.87

Diluted earnings per share	$	0.90	$	0.90	$	0.98	$	1.80	$	1.82


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

	Three Months Ended
	June 30, 2024						March 31, 2024						June 30, 2023
	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)	$	1,987,533	$	35,421	7.17	%	$	1,916,288	$	33,628	7.06	%	$	1,676,816	$	27,630	6.61	%
Taxable securities	165,141		2,039		4.97	%	163,586		1,981		4.87	%	151,107		1,641		4.36	%
Nontaxable securities	45,537		231		2.04	%	45,368		229		2.03	%	45,624		228		2.00	%
Other interest-earnings assets	242,214		3,316		5.51	%	211,127		2,898		5.52	%	218,451		2,686		4.93	%
Total interest-earning assets	$	2,440,425	$	41,007	6.76	%	$	2,336,369	$	38,736	6.67	%	$	2,091,998	$	32,185	6.17	%
Allowance for credit losses	(25,332)						(24,313)						(20,154)
Noninterest-earning assets	137,917						135,222						128,999
Total Assets	$	2,553,010					$	2,447,278					$	2,200,843

Liabilities and Stockholders’ Equity:
Interest-bearing liabilities:
Interest-bearing transaction accounts	85,976		21		0.10	%	85,858		26		0.12	%	92,245		20		0.09	%
Savings and money market accounts	929,930		9,229		3.99	%	902,361		8,804		3.92	%	845,742		6,872		3.26	%
Time deposits	713,776		8,261		4.65	%	645,088		7,076		4.41	%	474,060		4,106		3.47	%
FHLB advances	48,374		596		4.96	%	53,121		655		4.96	%	45,000		529		4.72	%
Other borrowings	94,815		1,321		5.60	%	95,650		1,336		5.62	%	86,411		1,226		5.69	%
Total interest-bearing liabilities	$	1,872,871	$	19,428	4.17	%	$	1,782,078	$	17,897	4.04	%	$	1,543,458	$	12,753	3.31	%

Noninterest-bearing liabilities:
Noninterest-bearing deposits	$	420,885					$	416,141					$	438,987
Other liabilities	32,727						29,437						24,882
Total noninterest-bearing liabilities	$	453,612					$	445,578					$	463,869
Stockholders’ Equity	226,527						219,622						193,516
Total Liabilities and Stockholders’ Equity	$	2,553,010					$	2,447,278					$	2,200,843

Net interest income			$	21,579					$	20,839					$	19,432
Net interest spread(2)					2.59	%					2.63	%					2.86	%
Net interest margin(3)					3.56	%					3.59	%					3.73	%
Net interest margin - FTE(4)(5)					3.57	%					3.60	%					3.74	%
Cost of funds(6)					3.41	%					3.27	%					2.58	%
Cost of interest-bearing deposits					4.07	%					3.92	%					3.12	%
Cost of total deposits					3.27	%					3.12	%					2.38	%


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

	Six Months Ended
	June 30, 2024						June 30, 2023
	Average Balance		Interest		Yield/Rate		Average Balance		Interest		Yield/Rate
Assets:
Interest-earning assets:
Loans, net of unearned income(1)	$	1,951,910	$	69,049	7.11	%	$	1,643,376	$	52,965	6.50	%
Taxable securities	164,363		4,020		4.92	%	145,344		3,024		4.20	%
Nontaxable securities	45,453		460		2.04	%	49,208		519		2.13	%
Other interest-earnings assets	226,671		6,214		5.51	%	182,447		4,376		4.84	%
Total interest-earning assets	$	2,388,397	$	79,743	6.71	%	$	2,020,375	$	60,884	6.08	%
Allowance for credit losses	(24,822)						(20,315)
Noninterest-earning assets	136,569						129,268
Total Assets	$	2,500,144					$	2,129,328

Liabilities and Stockholders’ Equity:
Interest-bearing liabilities:
Interest-bearing transaction accounts	85,917		48		0.11	%	93,093		40		0.09	%
Savings and money market accounts	916,145		18,032		3.96	%	825,982		11,911		2.91	%
Time deposits	679,432		15,337		4.54	%	437,573		6,815		3.14	%
FHLB advances	50,747		1,251		4.96	%	31,862		688		4.35	%
Other borrowings	95,233		2,657		5.61	%	86,367		2,452		5.73	%
Total interest-bearing liabilities	$	1,827,474	$	37,325	4.11	%	$	1,474,877	$	21,906	3.00	%

Noninterest-bearing liabilities:
Noninterest-bearing deposits	$	418,513					$	438,862
Other liabilities	31,082						25,493
Total noninterest-bearing liabilities	$	449,595					$	464,355
Stockholders’ Equity	223,075						190,096
Total Liabilities and Stockholders’ Equity	$	2,500,144					$	2,129,328

Net interest income			$	42,418					$	38,978
Net interest spread(2)					2.60	%					3.08	%
Net interest margin(3)					3.57	%					3.89	%
Net interest margin - FTE(4)(5)					3.58	%					3.90	%
Cost of funds(6)					3.34	%					2.31	%
Cost of interest-bearing deposits					4.00	%					2.79	%
Cost of total deposits					3.20	%					2.11	%


LOAN COMPOSITION
(Dollars in thousands)

	June 30, 2024				March 31, 2024				December 31, 2023				June 30, 2023
	Amount		% of gross		Amount		% of gross		Amount		% of gross		Amount		% of gross

Real estate mortgages:
Construction and development	$	242,573	12.0	%	$	252,934	12.8	%	$	242,960	12.9	%	$	228,236	13.3	%
Residential	249,498		12.3	%	238,702		12.1	%	224,603		11.9	%	214,897		12.5	%
Commercial	1,222,739		60.5	%	1,182,634		60.0	%	1,144,867		60.5	%	1,011,815		58.7	%
Commercial and industrial	297,501		14.7	%	288,701		14.7	%	269,961		14.3	%	259,195		15.0	%
Consumer and other	9,566		0.5	%	8,425		0.4	%	8,286		0.4	%	8,135		0.5	%
Gross loans	2,021,877		100.0	%	1,971,396		100.0	%	1,890,677		100.0	%	1,722,278		100.0	%
Unearned income	(6,443)				(6,247)				(6,169)				(5,766)
Loans, net of unearned income	2,015,434				1,965,149				1,884,508				1,716,512
Allowance for credit losses	(25,828)				(25,144)				(24,378)				(21,385)
Loans, net	$	1,989,606			$	1,940,005			$	1,860,130			$	1,695,127


DEPOSIT COMPOSITION
(Dollars in thousands)

	June 30, 2024				March 31, 2024				December 31, 2023				June 30, 2023
	Amount		% of total		Amount		% of total		Amount		% of total		Amount		% of total


Noninterest-bearing transaction	$	416,068	19.1	%	$	416,704	19.7	%	$	437,959	21.7	%	$	449,433	23.3	%
Interest-bearing transaction	1,006,687		46.3	%	974,079		46.2	%	946,347		46.9	%	922,835		48.0	%
Savings	32,527		1.5	%	33,909		1.6	%	35,412		1.7	%	41,574		2.2	%
Time deposits, $250,000 and under	612,299		28.1	%	584,658		27.7	%	500,406		24.8	%	438,228		22.8	%
Time deposits, over $250,000	108,097		5.0	%	100,448		4.8	%	98,065		4.9	%	71,841		3.7	%
Total deposits	$	2,175,678	100.0	%	$	2,109,798	100.0	%	$	2,018,189	100.0	%	$	1,923,911	100.0	%


Nonperforming Assets
(Dollars in thousands)

	June 30, 2024			March 31, 2024			December 31, 2023			June 30, 2023


Nonaccrual loans	$	3,784		$	3,446		$	1,017		$	1,010
Past due loans 90 days or more and still accruing interest	—			—			160			—
Total nonperforming loans	3,784			3,446			1,177			1,010
OREO	33			33			33			2,870

Total nonperforming assets	$	3,817		$	3,479		$	1,210		$	3,880

Financial difficulty modification loans – nonaccrual(1)	647			675			907			724
Financial difficulty modification loans – accruing	1,093			1,283			1,095			1,328
Financial difficulty modification loans	$	1,740		$	1,958		$	2,002		$	2,052

Allowance for credit losses	$	25,828		$	25,144		$	24,378		$	21,385
Loans, net of unearned income at the end of the period	$	2,015,434		$	1,965,149		$	1,884,508		$	1,716,512
Gross loans outstanding at the end of period	$	2,021,877		$	1,971,396		$	1,890,677		$	1,722,278
Total assets	$	2,572,011		$	2,510,975		$	2,446,663		$	2,277,803
Allowance for credit losses to nonperforming loans	682.56		%	729.66		%	2071.20		%	2117.33		%
Nonperforming loans to loans, net of unearned income	0.19		%	0.18		%	0.06		%	0.06		%
Nonperforming loans to gross loans	0.19		%	0.17		%	0.06		%	0.06		%
Nonperforming assets to gross loans and OREO	0.19		%	0.18		%	0.06		%	0.22		%
Nonperforming assets to total assets	0.15		%	0.14		%	0.05		%	0.17		%

Nonaccrual loans by category:
Real estate mortgages:
Construction & Development	$	—		$	—		$	—		$	33
Residential Mortgages	393			246			252			297
Commercial Real Estate Mortgages	2,182			2,422			765			671
Commercial & Industrial	1,209			778			—			9
Consumer and other	—			—			—			—
Total	$	3,784		$	3,446		$	1,017		$	1,010


Allowance for Credit Losses
(Dollars in thousands)

	Three Months Ended									Six Months Ended
	June 30, 2024			March 31, 2024			June 30, 2023			June 30, 2024			June 30, 2023

Average loans, net of unearned income	$	1,987,533		$	1,916,288		$	1,676,816		$	1,951,910		$	1,643,376
Loans, net of unearned income	2,015,434			1,965,149			1,716,512			2,015,434			1,716,512
Gross loans	2,021,877			1,971,396			1,722,278			2,021,877			1,722,278
Allowance for credit losses at beginning of the period	25,144			24,378			19,855			24,378			20,156
Impact of adoption of ASC 326	—			—			—			—			(1,285)
Charge-offs:
Construction and development	—			—			—			—			—
Residential	—			11			—			11			—
Commercial	11			27			—			38			—
Commercial and industrial	384			442			44			826			262
Consumer and other	10			15			—			25			6
Total charge-offs	405			495			44			900			268
Recoveries:
Construction and development	—			—			—			—			—
Residential	6			8			17			14			28
Commercial	—			—			—			—			—
Commercial and industrial	15			16			—			31			14
Consumer and other	1			1			—			2			2
Total recoveries	22			25			17			47			44
Net charge-offs	$	383		$	470		$	27		$	853		$	224

Provision for credit losses	$	1,067		$	1,236		$	1,557		$	2,303		$	2,738
Balance at end of the period	$	25,828		$	25,144		$	21,385		$	25,828		$	21,385

Allowance for credit losses on unfunded commitments at beginning of the period	$	1,288		$	1,239		$	1,285		$	1,239		$	—
Impact of adoption of ASC 326	—			—			—			—			1,285
(Credit) provision for credit losses on unfunded commitments	(82)			49			210			(33)			210
Balance at the end of the period	$	1,206		$	1,288		$	1,495		$	1,206		$	1,495

Allowance to loans, net of unearned income	1.28		%	1.28		%	1.25		%	1.28		%	1.25		%
Allowance to gross loans	1.28		%	1.28		%	1.24		%	1.28		%	1.24		%
Net charge-offs to average loans, net of unearned income(1)	0.08		%	0.10		%	0.01		%	0.09		%	0.03		%
Provision for credit losses to average loans, net of unearned income(1)	0.22		%	0.26		%	0.37		%	0.24		%	0.34		%

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.


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

	Three Months Ended									Six Months Ended
	June 30, 2024			March 31, 2024			June 30, 2023			June 30, 2024			June 30, 2023

Net income	$	8,198		$	8,119		$	8,756		$	16,317		$	16,427
Add: One-time retirement related expenses	—			—			1,571			—			1,571
Add: Professional fees related to ERC	—			—			1,243			—			1,243
Add: Wire fraud loss	1,155			—			—			1,155			—
Add: Net OREO (gain) loss	(3)			—			7			(3)			7

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



Less: Net gain (loss) on securities	20			(12)			(45)			8			469
Less: Tax effect	272			3			(536)			275			(660)
Core net income	$	9,058		$	8,128		$	7,058		$	17,186		$	14,339
Average assets	$	2,553,010		$	2,447,278		$	2,200,843		$	2,500,144		$	2,129,328
Core return on average assets	1.43		%	1.34		%	1.29		%	1.38		%	1.36		%

Net income	$	8,198		$	8,119		$	8,756		$	16,317		$	16,427
Add: One-time retirement related expenses	—			—			1,571			—			1,571
Add: Professional fees related to ERC	—			—			1,243			—			1,243
Add: Wire fraud loss	1,155			—			—			1,155			—
Add: Net OREO (gain) loss	(3)			—			7			(3)			7
Add: Provision	1,067			1,236			1,557			2,303			2,738

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



Less: Net gain (loss) on securities	20			(12)			(45)			8			469
Add: Income taxes	2,271			2,377			2,549			4,648			4,871
Pretax pre-provision core net income	$	12,668		$	11,744		$	10,628		$	24,412		$	21,288
Average assets	$	2,553,010		$	2,447,278		$	2,200,843		$	2,500,144		$	2,129,328
Pretax pre-provision core return on average assets	2.00		%	1.93		%	1.94		%	1.96		%	2.02		%

Net interest income	$	21,579		$	20,839		$	19,432		$	42,418		$	38,978
Add: Fully-taxable equivalent adjustments(1)	73			73			65			146			143
Net interest income - FTE	$	21,652		$	20,912		$	19,497		$	42,564		$	39,121

Net interest margin	3.56		%	3.59		%	3.73		%	3.57		%	3.89		%
Effect of fully-taxable equivalent adjustments(1)	0.01		%	0.01		%	0.01		%	0.01		%	0.01		%
Net interest margin - FTE	3.57		%	3.60		%	3.74		%	3.58		%	3.90		%

Total stockholders' equity	$	230,581		$	222,881		$	197,250		$	230,581		$	197,250
Less: Intangible assets	17,597			17,679			17,924			17,597			17,924

Tangible common equity	$	212,984		$	205,202		$	179,326		$	212,984		$	179,326

(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									Six Months Ended
	June 30, 2024			March 31, 2024			June 30, 2023			June 30, 2024			June 30, 2023

Core net income	$	9,058		$	8,128		$	7,058		$	17,186		$	14,339
Diluted weighted average shares outstanding	9,070,568			9,043,122			8,950,847			9,062,548			9,001,600
Diluted core earnings per share	$	1.00		$	0.90		$	0.79		$	1.90		$	1.59

Common shares outstanding at year or period end	8,908,130			8,894,794			8,738,814			8,908,130			8,738,814
Tangible book value per share	$	23.91		$	23.07		$	20.52		$	23.91		$	20.52

Total assets at end of period	$	2,572,011		$	2,510,975		$	2,277,803		$	2,572,011		$	2,277,803
Less: Intangible assets	17,597			17,679			17,924			17,597			17,924
Adjusted assets at end of period	$	2,554,414		$	2,493,296		$	2,259,879		$	2,554,414		$	2,259,879
Tangible common equity to tangible assets	8.34		%	8.23		%	7.94		%	8.34		%	7.94		%

Total average shareholders equity	$	226,527		$	219,622		$	193,516		$	223,075		$	190,096
Less: Average intangible assets	17,646			17,730			17,974			17,688			18,014
Average tangible common equity	$	208,881		$	201,892		$	175,542		$	205,387		$	172,082
Net income to common shareholders	$	8,198		$	8,119		$	8,756		$	16,317		$	16,427
Return on average tangible common equity	15.79		%	16.17		%	20.01		%	15.98		%	19.25		%
Average tangible common equity	$	208,881		$	201,892		$	175,542		$	205,387		$	172,082
Core net income	$	9,058		$	8,128		$	7,058		$	17,186		$	14,339
Core return on average tangible common equity	17.44		%	16.19		%	16.13		%	16.83		%	16.80		%

Net interest income	$	21,579		$	20,839		$	19,432		$	42,418		$	38,978
Add: Noninterest income	1,368			1,268			6,862			2,636			8,648

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



Less: Net gain (loss) on securities	20			(12)			(45)			8			469
Operating revenue	$	22,927		$	22,119		$	21,239		$	45,046		$	42,057

Expenses:
Total noninterest expense	$	11,411		$	10,375		$	13,432		$	21,786		$	23,590
Less: One-time retirement related expenses	—			—			1,571			—			1,571
Less: Professional fees related to ERC	—			—			1,243			—			1,243
Less: Wire fraud loss	1,155			—			—			1,155			—
Less: Net OREO (gain) loss	(3)			—			7			(3)			7

Adjusted noninterest expenses	$	10,259		$	10,375		$	10,611		$	20,634		$	20,769
Core efficiency ratio	44.75		%	46.90		%	49.96		%	45.81		%	49.38		%


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