SouthState Corporation (NASDAQ:SSB) Q3 2023 Earnings Call Transcript October 27, 2023 9:00 AM ET

Company Participants

William Matthews - Chief Financial Officer

John Corbett - Chief Executive Officer

Steven Young - Chief Strategy Officer

Conference Call Participants

Stephen Scouten - Piper Sandler

Catherine Mealor - KBW

Michael Rose - Raymond James

David Bishop - Hovde Group

Brody Preston - UBS

Operator

Good morning, my name is Audra and I will be your conference operator today. At this time, I would like to welcome everyone to the SouthState Corporation Q3 2023 Earnings Conference Call. Today's conference is being recorded. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session.

[Operator Instructions] At this time, I would like to turn the conference over to Will Matthews, Chief Financial Officer. Please go ahead.

William Matthews

Good morning, and welcome to SouthState's third quarter 2023 earnings call. This is Will Matthews, I'm here with John Corbett, Steve Young, and Jeremy Lucas. John and I will make some brief prepared remarks and then we'll open it up for questions. As always, a copy of our earnings release and presentation slides are on our Investor Relations website. Before we begin our remarks, I want to remind you that comments we make may include forward-looking statements within the meaning of the federal securities laws and regulations. Any such forward-looking statements we may make are subject to the safe-harbor rules. Please review the forward-looking disclaimer and safe-harbor language in the press release and presentation for more information about our forward-looking statements and risks and uncertainties which may affect us.

Now, I will turn the call over to John Corbett, our CEO.

John Corbett

Thank you, Will. Good morning everybody. Thanks for joining us. In the earnings release last night, you can see that SouthState delivered a solid quarter that was right in-line with our previous guidance. Will can cover the details but high level we continue to see steady growth in loans and customer deposits, liquidity is stable, capital ratios are growing, deposit funding is best in class and our net interest margin is settling in at a pretty good spot.

One of the core values that we continually preach to our team is to keep our eye on the long-term horizon. So, we spent a lot of time talking about the big picture, talking about the economic cycle and where we have risks and where we have advantages. The stages of a banking cycle are simple and predictable. The cycle risks move from liquidity, then to earnings, then to credit, and then finally to capital. But while the stages are easy to predict, predicting the speed and the severity of the cycle, that's the tough part. Since March, we've clearly moved through the first phase, the liquidity tightening phase as deposits left the banking system for money market funds. Now the predictable and necessary response is that the industry trades away future earnings power as deposit costs rise.