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What changed in Ameris Bancorp's 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of Ameris Bancorp's 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+373 added−308 removedSource: 10-K (2025-02-28) vs 10-K (2024-02-28)

Top changes in Ameris Bancorp's 2024 10-K

373 paragraphs added · 308 removed · 243 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

67 edited+24 added−13 removed125 unchanged
Biggest changeAll new loans or modifications to existing loans in excess of $500,000 are reviewed monthly by the Company’s Credit Administration Department with the lender responsible for the credit. In addition, our ongoing loan review program subjects the portfolio to sampling and objective review by our ongoing internal loan review process which is independent of the originating loan officer.
Biggest changeWhen the request for approval exceeds the authority level of the market or regional credit officer, the approval of the Company’s Chief Credit Officer and/or the Company’s loan committee is required. All new loans or modifications to existing loans in excess of $500,000 are reviewed monthly by the Company’s Credit Administration Department with the lender responsible for the credit.
The Company also originates first mortgage residential mortgage loans and generally enters into a commitment to sell these loans in the secondary market. We have not made or participated in foreign, energy-related or subprime loans. In addition, the Company may buy loan participations or portions of national credits from time to time.
The Company also originates first mortgage residential mortgage loans and generally enters into a commitment to sell these loans in the secondary market. In addition, the Company may buy loan participations or portions of national credits from time to time. We have not made or participated in foreign, energy-related or subprime loans.
In addition, a bank holding company is required to consult with or notify the Federal Reserve prior to purchasing or redeeming its outstanding equity securities in certain circumstances, including if the gross consideration for the purchase or redemption, when aggregated with the net consideration paid by the company for all such purchases or redemptions during the preceding 12 months, is equal to 10% or more of the company's consolidated net worth.
In addition, a bank holding company is required to consult with or notify the Federal Reserve prior to purchasing or redeeming its outstanding equity securities in certain circumstances, including if the gross consideration for the purchase or redemption, when aggregated with the net 11 consideration paid by the company for all such purchases or redemptions during the preceding 12 months, is equal to 10% or more of the company's consolidated net worth.
Competition is affected by the general availability of lendable funds, general and local economic conditions, current interest rate levels and other factors that are not readily predictable. Competition among providers of financial products and services continues to increase with consumers having the opportunity to select from a growing variety of traditional and nontraditional alternatives, including FinTech firms.
Competition is affected by the general availability of lendable funds, general and local economic conditions, current interest rate levels and other factors that are not readily predictable. 8 Competition among providers of financial products and services continues to increase with consumers having the opportunity to select from a growing variety of traditional and nontraditional alternatives, including FinTech firms.
Under the interim final rule, the amount of adjustments to regulatory capital deferred until the phase-in period includes both the initial impact of a banking organization’s adoption of CECL at January 1, 2020 and 25% of subsequent changes in its allowance for credit losses during each quarter of the two-year period ended December 31, 2021.
Under the interim final rule, the amount of adjustments to regulatory capital deferred until the phase-in period includes both the initial impact of a banking 12 organization’s adoption of CECL at January 1, 2020 and 25% of subsequent changes in its allowance for credit losses during each quarter of the two-year period ended December 31, 2021.
The CAMELS rating system is a supervisory rating system developed to classify a bank’s overall condition by taking into account capital adequacy, assets, management capability, earnings, liquidity and sensitivity to market and interest rate risk. The methodology that the FDIC uses to calculate assessment amounts is also based on the FDIC’s designated reserve ratio, which is currently 2%.
The CAMELS rating system is a supervisory rating system developed to classify a bank’s overall condition by taking into account capital adequacy, assets, management capability, earnings, liquidity and sensitivity to market and interest rate risk. The methodology that the FDIC uses to calculate assessment 13 amounts is also based on the FDIC’s designated reserve ratio, which is currently 2%.
Federal law makes it a criminal offense, except in limited circumstances, to obtain or attempt to obtain customer information of a financial nature by fraudulent or deceptive means. 15 The federal banking agencies pay close attention to the cybersecurity practices of banks, and the agencies include review of an institution’s information technology and its ability to thwart cyberattacks in their examinations.
Federal law makes it a criminal offense, except in limited circumstances, to obtain or attempt to obtain customer information of a financial nature by fraudulent or deceptive means. The federal banking agencies pay close attention to the cybersecurity practices of banks, and the agencies include review of an institution’s information technology and its ability to thwart cyberattacks in their examinations.
The Gramm-Leach-Bliley Act also provides that, with certain limited exceptions, an institution may not provide such personal information to unaffiliated third parties unless the institution discloses to the customer that such information may be so provided and the customer is given the opportunity to opt out of such disclosure.
The Gramm-Leach-Bliley Act also provides that, with certain limited exceptions, an institution may not provide such personal information to unaffiliated third parties unless the institution discloses to the customer that such 16 information may be so provided and the customer is given the opportunity to opt out of such disclosure.
During 2020, in response to the COVID-19 pandemic, the 12 Federal Reserve reduced all reserve requirement ratios to zero. The Federal Reserve indicated that it may adjust reserve requirement ratios in the future if conditions warrant. FDIC Insurance Assessments The Bank’s deposits are insured to the maximum extent permitted by the DIF.
During 2020, in response to the COVID-19 pandemic, the Federal Reserve reduced all reserve requirement ratios to zero. The Federal Reserve indicated that it may adjust reserve requirement ratios in the future if conditions warrant. FDIC Insurance Assessments The Bank’s deposits are insured to the maximum extent permitted by the DIF.
These deposit accounts have a variety of interest rates and terms and consist of interest-bearing and noninterest-bearing accounts, including commercial and retail checking accounts, regular interest-bearing savings accounts, money market accounts, individual retirement accounts and certificates of deposit. Our Bank obtains most of its deposits from individuals and businesses in its market areas.
These deposit accounts have a variety of interest rates and terms and consist of interest-bearing and noninterest-bearing accounts, including 7 commercial and retail checking accounts, regular interest-bearing savings accounts, money market accounts, individual retirement accounts and certificates of deposit. Our Bank obtains most of its deposits from individuals and businesses in its market areas.
The Company maintains a diversified loan portfolio by providing a broad range of commercial and retail lending services to business entities and individuals. We provide agricultural loans, commercial business loans, commercial and residential real estate construction and mortgage loans, consumer loans, revolving lines of credit and letters of credit.
The Company maintains a diversified loan portfolio by providing a broad range of commercial and retail lending services to business entities and individuals. We provide agricultural loans, commercial business loans, commercial and 5 residential real estate construction and mortgage loans, consumer loans, revolving lines of credit and letters of credit.
Credit Administration We have sought to maintain a comprehensive lending policy that meets the credit needs of each of the communities served by the Bank, including low and moderate-income customers, and to employ lending procedures and policies consistent with this 5 approach.
Credit Administration We have sought to maintain a comprehensive lending policy that meets the credit needs of each of the communities served by the Bank, including low and moderate-income customers, and to employ lending procedures and policies consistent with this approach.
Under these laws and regulations, the Bank is required to take steps to prevent the use of the Bank to facilitate the flow of illegal or illicit money, to report large currency transactions and to file suspicious activity reports.
Under these 15 laws and regulations, the Bank is required to take steps to prevent the use of the Bank to facilitate the flow of illegal or illicit money, to report large currency transactions and to file suspicious activity reports.
The terms of these loans typically range from 12 to 240 months and vary based upon the nature of collateral and size of the loan. These loans are generally secured by various assets owned by the consumer.
The terms of these loans typically range from 12 to 240 months and vary based upon the nature of collateral and size of the loan. These loans are generally secured by various assets owned by the consumer. Agricultural Loans.
While our select market areas in Georgia, Alabama, Florida, North Carolina and South Carolina have experienced strong population growth in recent decades, intense market demands, national and local economic pressures, including a rising interest rate environment, and increased customer awareness of product and service differences among financial institutions have forced banks to diversify their services and become much more cost effective.
While our select market areas in Georgia, Alabama, Florida, North Carolina and South Carolina have experienced strong population growth in recent decades, intense market demands, national and local economic pressures, including a higher interest rate environment, and increased customer awareness of product and service differences among financial institutions have forced banks to diversify their services and become much more cost effective.
Management expects that competition will become more intense in the future due to changes in state and federal laws and regulations and the entry of additional bank and nonbank competitors. Further, the industry continues to consolidate, which affects competition by eliminating some regional and local institutions, while strengthening the franchise of acquirers. See “Supervision and Regulation” under this Item.
Management expects that competition will become more intense in the future due to changes in state and federal laws and regulations and the entry of additional bank and non-bank competitors. Further, the industry continues to consolidate, which affects competition by eliminating some regional and local institutions, while strengthening the franchise of acquirers. See “Supervision and Regulation” under this Item.
The BHCA generally prohibits a bank holding company and its subsidiaries from engaging in, or acquiring control of a company engaged in, activities other than managing or controlling banks, activities that the Federal Reserve has determined to be closely related to banking and certain other permissible nonbanking activities.
The BHCA generally prohibits a bank holding company and its subsidiaries from engaging in, or acquiring control of a company engaged in, activities other than managing or controlling banks, activities that the Federal Reserve has determined to be closely related to banking and certain other permissible non-banking activities.
The lending officer visits the borrower regularly during the growing season and re-evaluates the loan in light of the borrower’s updated cash flow projections. A portion of our agricultural loans is guaranteed by the Farm Service Agency Guaranteed Loan Program. Commercial and Industrial Loans.
The lending officer visits the borrower regularly during the growing season and re-evaluates the loan in light of the borrower’s updated cash flow projections. A portion of our agricultural loans is guaranteed by the Farm Service Agency Guaranteed Loan Program.
Our educational assistance program, which provides for reimbursement of certain education expenses up to $5,250, encourages personal development through formal education such as a degree, licensing or certification, so that teammates can maintain and improve their skills or knowledge related to their current job or foreseeable-future position at Ameris.
Our educational assistance program, which provides for reimbursement of certain education expenses, encourages personal development through formal education such as a degree, licensing or certification, so that teammates can maintain and improve their skills or knowledge related to their current job or foreseeable-future position at Ameris.
This portion of our loan portfolio has grown significantly over the past few years and represents the largest segment of our loan portfolio. Commercial real estate loans include loans secured by owner-occupied commercial buildings for office, storage, retail, farmland and warehouse space. They also include non-owner occupied commercial buildings such as leased retail and office space.
This portion of our loan portfolio has grown significantly over the past few years and represents the largest segment of our loan portfolio. Commercial real estate loans include loans secured by owner-occupied commercial buildings for office, storage, retail, farmland and warehouse space. They also include multifamily residential properties and non-owner occupied commercial buildings such as leased retail and office space.
Strategy We seek to increase our presence and grow the “Ameris” brand in the markets that we currently serve in Georgia, Alabama, Florida, North Carolina and South Carolina and in neighboring communities that present attractive opportunities for expansion. Management has pursued this objective through an acquisition-oriented growth strategy and a prudent operating strategy.
Strategy We seek to increase our presence and grow the “Ameris” brand in the markets that we currently serve in Georgia, Alabama, Florida, North Carolina and South Carolina and in neighboring communities that present attractive opportunities for expansion. Management has pursued this objective through a prudent operating and growth strategy.
HUMAN CAPITAL At Ameris, we consider our teammates to be our greatest strength. At December 31, 2023, the Company employed 2,765 full-time-equivalent employees, primarily located in our core markets of Georgia, Alabama, Florida, North Carolina and South Carolina. We take pride in listening to our employees, welcoming unique perspectives, supporting personal and professional growth and developing natural strengths.
HUMAN CAPITAL At Ameris, we consider our teammates to be our greatest strength. At December 31, 2024, the Company employed 2,691 full-time-equivalent employees, primarily located in our core markets of Georgia, Alabama, Florida, North Carolina and South Carolina. We take pride in listening to our employees, welcoming unique perspectives, supporting personal and professional growth and developing natural strengths.
The Company may also enter into repurchase agreements. These repurchase agreements are treated as short-term borrowings and are reflected on the Company’s balance sheet as such. MARKET AREAS AND COMPETITION The banking industry in general, and in the southeastern United States specifically, is highly competitive and dramatic changes continue to occur throughout the industry.
These repurchase agreements are treated as short-term borrowings and are reflected on the Company’s balance sheet as such. MARKET AREAS AND COMPETITION The banking industry in general, and in the southeastern United States specifically, is highly competitive and dramatic changes continue to occur throughout the industry.
As a result, the effects of CECL on Ameris’s and the Bank’s regulatory capital were delayed through 2021 and now will be phased-in over a three-year period from January 1, 2022 through December 31, 2024.
As a result, the effects of CECL on Ameris’s and the Bank’s regulatory capital were delayed through 2021 and have been phased-in over a three-year period from January 1, 2022 through December 31, 2024.
However, a bank holding company that is qualified and has elected to be a financial holding company may engage in, or acquire control of a company engaged in, an expanded set of financial activities. Effective August 24, 2000, Ameris has elected to be a financial holding company.
However, a bank holding company that is qualified and has elected to be a financial holding company, as Ameris did in 2000, may engage in, or acquire control of a company engaged in, an expanded set of financial activities.
Loans that are serviced by others, such as certain residential mortgage loans and consumer installment home improvement loans, are monitored by the Company’s credit officers, although ultimate collection of past due amounts is the responsibility of the servicing agents.
Loans that are serviced by others, such as certain residential mortgage loans, are monitored by the Company’s credit officers, although ultimate collection of past due amounts is the responsibility of the servicing agents.
As such, we may engage in activities that are financial in nature or incidental or complementary to financial activities, including insurance underwriting, securities underwriting and dealing, and making merchant banking investments in commercial and financial companies, provided that we and the Bank continue to meet certain regulatory standards and comply with applicable regulatory notice requirements.
As a result of our financial holding company election, we may engage in activities that are financial in nature or incidental or complementary to financial activities, including insurance underwriting, securities underwriting and dealing, and making merchant banking investments in commercial and financial companies, provided that we and the Bank continue to meet certain regulatory standards and comply with applicable regulatory notice requirements.
At December 31, 2023, the Bank exceeded its minimum capital requirements, inclusive of the capital conservation buffer, with common equity Tier 1 capital, Tier 1 capital 11 and total capital equal to 12.09%, 12.09% and 13.69% of its total risk-weighted assets, respectively, and a Tier 1 leverage ratio of 10.69%, and was “well-capitalized” for prompt corrective action purposes based on the ratios and guidelines described above.
At December 31, 2024, the Bank exceeded its minimum capital requirements, inclusive of the capital conservation buffer, with common equity Tier 1 capital, Tier 1 capital and total capital equal to 13.15%, 13.15% and 14.75% of its total risk-weighted assets, respectively, and a Tier 1 leverage ratio of 11.17%, and was “well-capitalized” for prompt corrective action purposes based on the ratios and guidelines described above.
The subordinated notes will mature on December 15, 2029 and through December 14, 2024 will bear a fixed rate of interest of 4.25% per annum. Beginning December 15, 2024, the interest rate on the subordinated notes resets quarterly to a floating rate per annum equal to the then-current three-month SOFR plus 2.94%.
The subordinated notes were scheduled to mature on December 15, 2029 and through December 14, 2024 bore a fixed rate of interest of 4.25% per annum. Beginning December 15, 2024, the interest rate on the subordinated notes was to reset quarterly to a floating rate per annum equal to the then-current three-month SOFR plus 2.94%.
Most provisions of the final rule will become effective on January 1, 2026, and the data reporting requirements will become effective on January 1, 2027.
Most provisions of the final rule are scheduled to become effective on January 1, 2026, and the data reporting requirements are scheduled to become effective on January 1, 2027.
The input obtained from these surveys helps the Board and executive officers to execute on initiatives such as the Ameris Foundation, leadership training and diversity and inclusion initiatives.
The input obtained from these surveys helps the Board and executive officers to execute on initiatives such as the Ameris Foundation, leadership training, inclusivity and career development initiatives.
As of December 31, 2023, our C&D concentration as a percentage of capital totaled 74.0% and our CRE concentration, net of owner-occupied loans, as a percentage of capital totaled 281.9%. Branching The Bank has branch offices in Alabama, Florida, Georgia, North Carolina and South Carolina.
As of December 31, 2024, our C&D concentration as a percentage of capital totaled 63.3% and our CRE concentration, net of owner-occupied loans, as a percentage of capital totaled 267.9%. Branching The Bank has branch offices in Alabama, Florida, Georgia, North Carolina and South Carolina.
Our Company’s loan policies establish limits on loan-to-value ratios that are equal to or less than those established in such regulations. 13 Commercial Real Estate Concentrations Under guidance issued by the federal banking regulators, a financial institution will be considered to have a significant commercial real estate (“CRE”) concentration risk, and will be subject to enhanced supervisory expectations to manage that risk, if (i) total reported loans for construction, land development and other land (“C&D”) represent 100% or more of the institution’s tier 1 capital plus the allowance for credit losses attributable to loans and leases or (ii) total CRE loans represent 300% or more of the institution’s tier 1 capital plus the allowance for credit losses attributable to loans and leases and the outstanding balance of the institution’s CRE loan portfolio has increased by 50% or more during the prior 36 months.
Commercial Real Estate Concentrations Under guidance issued by the federal banking regulators, a financial institution will be considered to have a significant commercial real estate (“CRE”) concentration risk, and will be subject to enhanced supervisory expectations to manage that risk, if (i) total reported loans for construction, land development and other land (“C&D”) represent 100% or more of the institution’s tier 1 capital plus the allowance for credit losses attributable to loans and leases or (ii) total CRE loans represent 14 300% or more of the institution’s tier 1 capital plus the allowance for credit losses attributable to loans and leases and the outstanding balance of the institution’s CRE loan portfolio has increased by 50% or more during the prior 36 months.
At December 31, 2023, our loan portfolio totaled approximately $20.55 billion, representing approximately 81.5% of our total assets. For additional discussion of our loan portfolio, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Loans.” Commercial Real Estate Loans.
At December 31, 2024, our loan portfolio totaled approximately $21.27 billion, representing approximately 81.0% of our total assets. For additional discussion of our loan portfolio, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Loans.” Commercial Real Estate Loans.
The Company recognized an expense of $11.6 million in the fourth quarter of 2023 related to the special assessment. On February 23, 2024, the FDIC provided an updated estimated loss to the DIF resulting from the receiverships of approximately $20.4 billion from the previous estimate of $16.3 billion.
The Company recognized an expense of $11.6 million in the fourth quarter of 2023 related to the special assessment. In the fourth quarter of 2024, the FDIC provided an updated estimated loss to the DIF resulting from the receiverships of approximately $18.9 billion from the original estimate of $16.3 billion.
Reports on all purchases, sales, net profits or losses and market appreciation or depreciation of the bond portfolio are reviewed by our board of directors (the “Board”) each quarter.
Reports on all purchases, sales, net profits or losses and market appreciation or depreciation of the bond portfolio are reviewed by our board of directors (the “Board”) each quarter. The written investment policy is reviewed annually by the Board and updated as needed.
Our lending policy requires analysis of the borrower’s projected cash flow and ability to service the debt. The Bank originates loans outside of our market areas through our national lines of business, including equipment finance, premium finance and government guaranteed lending. We actively market our services to qualified lending customers in both the commercial and consumer sectors.
The Bank originates loans outside of our market areas through our national lines of business, including equipment finance, premium finance and government guaranteed lending. We actively market our services to qualified lending customers in both the commercial and consumer sectors.
There are no such restrictions on a bank that is “well-capitalized.” At December 31, 2023, the Company exceeded its minimum capital requirements, inclusive of the capital conservation buffer, on a consolidated basis with common equity Tier 1 capital, Tier 1 capital and total capital equal to 11.23%, 11.23% and 14.45% of its total risk-weighted assets, respectively, and a Tier 1 leverage ratio of 9.93%.
There are no such restrictions on a bank that is “well-capitalized.” At December 31, 2024, the Company exceeded its minimum capital requirements, inclusive of the capital conservation buffer, on a consolidated basis with common equity Tier 1 capital, Tier 1 capital and total capital equal to 12.65%, 12.65% and 15.37% of its total risk-weighted assets, respectively, and a Tier 1 leverage ratio of 10.74%.
Climate-Related and Other ESG Developments In recent years, federal, state and international lawmakers and regulators have increased their focus on financial institutions' and other companies' risk oversight, disclosures and practices in connection with climate change and other environmental, social and governance (“ESG”) matters.
We are monitoring the status of the litigation and evaluating the impact of this rule. Climate-Related and Other ESG Developments In recent years, federal, state and international lawmakers and regulators have increased their focus on financial institutions' and other companies' risk oversight, disclosures and practices in connection with climate change and other environmental, social and governance (“ESG”) matters.
Our growth over the past several years has been enhanced significantly through both organic growth and acquisitions. We expect to continue to enhance our franchise through prudent acquisition activity when appropriate opportunities arise, and we intend to continue to prioritize organic growth in our business lines as well.
Our growth historically has been enhanced significantly through both organic growth and acquisitions. We expect to continue to enhance our franchise through prudent acquisition activity when appropriate opportunities arise, and we intend to continue to prioritize organic growth in our business lines as well. BANKING SERVICES Lending Activities General .
At December 31, 2023, we had approximately $25.20 billion in total assets, $20.55 billion in total loans, $20.71 billion in total deposits and $3.43 billion of shareholders’ equity. Our deposits are insured, up to applicable limits, by the Federal Deposit Insurance Corporation (the “FDIC”).
At December 31, 2024, we had approximately $26.26 billion in total assets, $21.27 billion in total loans, $21.72 billion in total deposits and $3.75 billion of shareholders’ equity. Our deposits are insured, up to applicable limits, by the Federal Deposit Insurance Corporation (the “FDIC”).
The Bank Merger Act imposes similar review and approval requirements in connection with acquisitions and mergers involving banks. Additionally, under the Change in Bank Control Act and the BHCA, a person or company that acquires control of a bank holding company or bank must obtain the non-objection or approval of the Federal Reserve in advance of the acquisition.
Additionally, under the Change in Bank Control Act and the BHCA, a person or company that acquires control of a bank holding company or bank must obtain the non-objection or approval of the Federal Reserve in advance of the acquisition.
Federal Law Restrictions on the Company’s Activities and Investments As a registered bank holding company, we are subject to regulation under the Bank Holding Company Act (the “BHCA”) and to the supervision, examination and reporting requirements of the Federal Reserve.
In addition, the Consumer Financial Protection Bureau (the "CFPB") supervises the Bank with respect to consumer protection laws and regulations. Federal Law Restrictions on the Company’s Activities and Investments As a registered bank holding company, we are subject to regulation under the Bank Holding Company Act (the “BHCA”) and to the supervision, examination and reporting requirements of the Federal Reserve.
Over the past few years, our Bank has faced strong competition in attracting deposits at profitable levels. Competition for deposits comes from other commercial banks, thrift institutions, savings banks, internet banks, credit unions, and brokerage 7 and investment banking firms.
Over the past few years, our Bank has faced strong competition in attracting deposits at profitable levels. Competition for deposits comes from other commercial banks, thrift institutions, savings banks, internet banks, credit unions, and brokerage and investment banking firms. Interest rates, online banking capabilities, convenience of office locations and marketing are all significant factors in our Bank’s competition for deposits.
The written investment policy is reviewed annually by the Board and updated as needed. 6 The Company’s securities are held in safekeeping accounts at approved correspondent banks Deposits The Company provides a full range of deposit accounts and services to both retail and commercial customers.
The Company’s securities are held in safekeeping accounts at approved correspondent banks Deposits The Company provides a full range of deposit accounts and services to both retail and commercial customers.
As of December 31, 2023, there was approximately $149.3 million of retained earnings of our Bank available for payment of cash dividends under applicable regulations without obtaining regulatory approval. 10 Under federal law, the ability of an insured depository institution such as the Bank to pay dividends or other distributions is restricted or prohibited if (i) the institution would fail to satisfy the regulatory capital conservation buffer requirement following the distribution, (ii) the distribution would cause the institution to become undercapitalized or (iii) the institution is in default of its payment of deposit insurance assessments to the FDIC.
Under federal law, the ability of an insured depository institution such as the Bank to pay dividends or other distributions is restricted or prohibited if (i) the institution would fail to satisfy the regulatory capital conservation buffer requirement following the distribution, (ii) the distribution would cause the institution to become undercapitalized or (iii) the institution is in default of its payment of deposit insurance assessments to the FDIC.
Periodically, a portion of the loans that are secured by the guaranty of the SBA will be sold in the secondary market. Management believes that making such loans helps the local community and also provides Ameris with a source of income and solid future lending relationships as such businesses grow and prosper.
Management believes that making such loans helps the local community and also provides Ameris with a source of income and solid future lending relationships as such businesses grow and prosper.
The residential real estate mortgage loans that are included in the Company’s loan portfolio are usually owner-occupied and generally amortized over a 20- to 30-year period with three- to five-year maturity or repricing. Agricultural Loans.
The residential real estate mortgage loans that are included in the Company’s loan portfolio are usually owner-occupied and generally amortized over a 20- to 30-year period with three- to five-year maturity or repricing. Commercial and Industrial Loans. Generally, commercial and industrial loans consist of loans made primarily to manufacturers, wholesalers and retailers of goods, service companies, municipalities and other industries.
SUPERVISION AND REGULATION General We are extensively regulated, supervised and examined under federal and state law. Generally, these laws and regulations are intended to protect our Bank’s depositors, the FDIC’s Deposit Insurance Fund (the “DIF”) and the broader banking system, and not our shareholders.
Generally, these laws and regulations are intended to protect our Bank’s depositors, the FDIC’s Deposit Insurance Fund (the “DIF”) and the broader banking system, and not our shareholders.
The Company redeemed these notes in full on the March 15, 2023 interest payment date. The Company has long-term subordinated deferrable interest debentures with a net book carrying value of $130.3 million as of December 31, 2023. The majority of these trust preferred securities were assumed as liabilities in previous whole bank acquisitions.
The Company has long-term subordinated deferrable interest debentures with a net book carrying value of $132.3 million as of December 31, 2024. The majority of these trust preferred securities were assumed as liabilities in previous whole bank acquisitions. The Company may also enter into repurchase agreements.
The mortgage-related final rules issued by the CFPB have materially restructured the origination, servicing and securitization of residential mortgages in the United States, and have imposed significant compliance obligations and costs on mortgage lenders, including the Bank.
The mortgage-related final rules issued by the CFPB have materially restructured the origination, servicing and securitization of residential mortgages in the United States, and have imposed significant compliance obligations and costs on mortgage lenders, including the Bank. The CFPB has identified certain areas of concern for consumers, including, for example, what the CFPB considers to be excessive and/or unexpected fees.
The loan policy provides that lending officers have sole authority to approve loans of various amounts commensurate with their seniority, experience and needs within the market. Our local market presidents have discretion to approve loans in varying principal amounts up to established limits, and our regional credit officers review and approve loans that exceed such limits.
The loan policy provides that lending officers have sole authority to approve loans of various amounts commensurate with their seniority, experience and needs within the market.
All requests for extensions of credit in excess of any of these limits are reviewed by either a market or regional credit officer as appropriate. When the request for approval exceeds the authority level of the market or regional credit officer, the approval of the Company’s Chief Credit Officer and/or the Company’s loan committee is required.
These approval limits are reviewed annually by the Company and adjusted as needed. All requests for extensions of credit in excess of any of these limits are reviewed by either a market or regional credit officer as appropriate.
Mentor Ameris is the Bank’s formal mentorship program, whereby annually, high potential colleagues are identified as mentees and paired with a selected mentor at the Bank. A total of 27 mentees were selected to participate in the program in 2023, of which 62% were female and 41% were minorities.
Mentor Ameris is the Bank’s formal mentorship program, whereby annually, high potential colleagues are identified as mentees and paired with a selected mentor at the Bank. A total of 26 mentees were selected to participate in the program in 2024. The program is a nine-month commitment that is designed to encourage a lifelong mentee-mentor relationship.
The Federal Reserve, the FDIC and the GDBF regularly examine the operations of the Company and the Bank and are given the authority to approve or disapprove mergers, consolidations, the establishment of branches and 9 similar corporate actions.
The Federal Reserve, the FDIC and the GDBF regularly examine the operations of the Company and the Bank and are given the authority to approve or disapprove mergers, consolidations, the establishment of branches and similar corporate actions. These agencies also have the power to prevent the continuance or development of unsafe or unsound banking practices or other violations of law.
Under this rule, a bank must report certain computer-security incidents to its primary federal regulatory as soon as possible and no later than 36 hours after the bank determines that an incident requiring notification has occurred.
An institution’s failure to have adequate cybersecurity safeguards in place can result in supervisory criticism, monetary penalties and reputational harm. Interagency rules require a bank to report certain computer-security incidents to its primary federal regulatory as soon as possible and no later than 36 hours after the bank determines that an incident requiring notification has occurred.
The proposal would adopt an approach for future adjustments to the interchange fee cap, which would occur every other year based on issuer cost data gathered by the Federal Reserve from large debit card issuers. 14 Anti-Money Laundering and Sanctions Compliance The Bank Secrecy Act, the USA PATRIOT Act of 2001 and other federal laws and regulations require financial institutions, among other things, to institute and maintain an effective anti-money laundering (“AML”) program.
The proposal would adopt an approach for future adjustments to the interchange fee cap, which would occur every other year based on issuer cost data gathered by the Federal Reserve from large debit card issuers.
In March 2022, the SEC issued a proposed rule on the enhancement and standardization of climate-related disclosures for investors. The proposed rule would require public issuers, including us, to significantly expand the scope of climate-related disclosures in their SEC filings. The SEC has also announced plans to propose rules to require enhanced disclosure regarding human capital management.
In March 2024, the SEC adopted a rule on the enhancement and standardization of climate-related disclosures for investors that would require public issuers, including us, to significantly expand the scope of climate-related disclosures included in issuers' SEC filings. In April 2024, the SEC stayed the climate-related disclosure rules pending the completion of judicial review.
The program is a nine-month commitment that is designed to encourage a lifelong mentee-mentor relationship. Launched at the end of 2020, our Leadership Development Program is a self-paced, three-tiered program available to all employees, with coursework specific to leading self, leading others and leading leaders.
Launched at the end of 2020, our Leadership Development Program is a self-paced, three-tiered program available to all employees, with coursework specific to leading self, leading others and leading leaders. We believe that effective and meaningful leadership development will further elevate the Company and support us in continuing to attract and retain top talent.
In order to remain competitive, our Bank has varied interest rates and loan fees to some degree as well as increased the number and complexity of services provided.
Competition for loans comes from other commercial banks, thrift institutions, savings banks, insurance companies, consumer finance companies, credit unions, mortgage companies, leasing companies and other institutional and non-traditional lenders. In order to remain competitive, our Bank has varied interest rates and loan fees to some degree as well as increased the number and complexity of services provided.
Each lending officer has authority to make loans only in the market area in which his or her Bank office is located and its contiguous counties. Occasionally, our loan committee will approve making a loan outside of the market areas of the Bank, provided the Bank has a prior relationship with the borrower.
In addition, our ongoing loan review program subjects the portfolio to sampling and objective review by our ongoing internal loan review process which is independent of the originating loan officer. Each lending officer has authority to make loans only in the market area in which his or her Bank office is located and its contiguous counties.
The importance of having career development discussions and guidance with employees is shared and reinforced during manager training sessions as well, as the Company recognizes these discussions are critical to establishing pathways for career growth. Diversity and Inclusion Diversity, equity and inclusion represent an integral part of our strategic vision at Ameris.
The importance of having career development discussions and guidance with employees is shared and reinforced during manager training sessions as well, as the Company recognizes these discussions are critical to establishing pathways for career growth. 9 We also focus on creating a culture that acknowledges and respects the various qualities, experiences and perspectives of every teammate.
Individual lending authority is assigned by the Company’s Chief Credit Officer, as is the maximum limit of new extensions of credit that may be approved in each market. These approval limits are reviewed annually by the Company and adjusted as needed.
Our local market presidents have discretion to approve loans in varying principal amounts up to established limits, and our regional credit officers review and approve loans that exceed such limits. 6 Individual lending authority is assigned by the Company’s Chief Credit Officer, as is the maximum limit of new extensions of credit that may be approved in each market.
The Company monitors these loans by requesting submission of corporate and personal financial statements and income tax returns. The Company has also generated loans which are guaranteed by the U.S. Small Business Administration (the “SBA”). SBA loans are generally underwritten in the same manner as conventional loans generated for the Bank’s portfolio.
These loans are made for acquisition, expansion, working capital and equipment financing and may be secured by accounts receivable, inventory, equipment, personal guarantees or other assets. The Company monitors these loans by requesting submission of corporate and personal financial statements and income tax returns. The Company has also generated loans which are guaranteed by the U.S.
Loss estimates will be periodically updated based on losses incurred and recoveries received. The amount of any additional assessment to the Company is unknown and will be recognized, if applicable, when it becomes reasonably estimable.
The amount of any additional assessment to the Company is unknown and will be recognized, if applicable, when it becomes reasonably estimable. On July 30, 2024, the FDIC issued a proposed rule that would revise the FDIC’s regulations governing the classification and treatment of brokered deposits.
The development of our employees’ skills and knowledge is critical to the success of the Company.
At the end of 2024, we had a total of 481 teammates who were enrolled in or completed the program. The development of our employees’ skills and knowledge is critical to the success of the Company.
During 2023, the Company repurchased on the open market and subsequently redeemed $12.0 million in aggregate principal of the 2029 subordinated notes. On March 13, 2017, the Company completed the public offering and sale of $75.0 million in aggregate principal amount of its 5.75% Fixed-To-Floating Rate Subordinated Notes due 2027. The subordinated notes were sold to the public at par.
During 2024 and 2023, the Company repurchased on the open market and redeemed $2.3 million and $12.0 million, respectively, in aggregate principal of the 2029 subordinated notes. The Company elected to redeem all the outstanding notes on December 16, 2024.
Removed
Our most recent bank acquisition was of Fidelity Southern Corporation ("Fidelity"), which was completed in July 2019 and which added $4.0 billion in deposits. In addition, in December 2021, the Bank acquired Balboa Capital Corporation ("Balboa"), a point of sale and direct online provider of lending solutions to small and mid-sized businesses nationwide. 4 BANKING SERVICES Lending Activities General .
Added
Small Business Administration (the “SBA”). SBA loans are generally underwritten in the same manner as conventional loans generated for the Bank’s portfolio. Periodically, a portion of the loans that are secured by the guaranty of the SBA will be sold in the secondary market.
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Generally, commercial and industrial loans consist of loans made primarily to manufacturers, wholesalers and retailers of goods, service companies, municipalities and other industries. These loans are made for acquisition, expansion, working capital and equipment financing and may be secured by accounts receivable, inventory, equipment, personal guarantees or other assets.
Added
Occasionally, our loan committee will approve making a loan outside of the market areas of the Bank, provided the Bank has a prior relationship with the borrower. Our lending policy requires analysis of the borrower’s projected cash flow and ability to service the debt.
Removed
The subordinated notes will mature on March 15, 2027 and through March 14, 2022 bore a fixed rate of interest of 5.75% per annum. Beginning March 15, 2022, the interest rate on the subordinated notes resets quarterly to a floating rate per annum equal to the then-current three-month LIBOR plus 3.616%.
Added
We aim to establish a workplace where everyone has the opportunity to contribute effectively and maximize their potential. Our objective is to ensure that all teammates, regardless of their background, have equal opportunities for success. We support open communication, teamwork, and active participation from all teammates, representing a wide range of viewpoints and experiences.
Removed
Interest rates, online banking capabilities, convenience of office locations and marketing are all significant factors in our Bank’s competition for deposits. Competition for loans comes from other commercial banks, thrift institutions, savings banks, insurance companies, consumer finance companies, credit unions, mortgage companies, leasing companies and other institutional and non-traditional lenders.
Added
By adopting these principles, we seek to develop a stronger, more innovative, and inclusive organization that serves our customers and communities efficiently. SUPERVISION AND REGULATION General We are extensively regulated, supervised and examined under federal and state law.
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We believe that effective and meaningful leadership development will further elevate the Company and support us in continuing to attract and retain top 8 talent. At the end of 2023, we had a total of 424 teammates who were enrolled in or completed the program, of which 73% were female and 38% were minorities.
Added
The Bank Merger Act imposes similar review and approval requirements in connection with acquisitions and mergers involving banks. On September 17, 2024, the FDIC finalized changes to its Statement of Policy on Bank Merger Transactions (the “Policy Statement”), which outlines factors that the FDIC will consider when evaluating a proposed bank merger transaction.
Removed
The Company is committed to fostering an equitable work environment that seeks to ensure fair treatment, equality of opportunity, and fairness in access to information and resources for all employees.
Added
Also on September 17, 2024, the United States Department of Justice (the “DOJ”) withdrew its 1995 Bank Merger Guidelines and 10 announced that it will instead evaluate the competitive impact of bank mergers using its 2023 Merger Guidelines that the DOJ applies to mergers in all industries.
Removed
We believe this is only possible in an environment built on respect and equal dignity, and we believe inclusion builds a culture of belonging by actively inviting the contribution and participation of all people.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeDisruption in the secondary market for residential mortgage loans as well as declines in real estate values, among other economic variables, could result in one or more of the following: • rising interest rates has caused a decline in mortgage originations, which could continue and potentially worsen, negatively impacting our earnings; • our inability to sell mortgage loans on the secondary market could negatively impact our liquidity position; • reductions in real estate values could decrease the potential for mortgage originations, which could negatively impact our earnings; 19 • if it is determined that loans were made in breach of our representations and warranties to the secondary market, we could incur losses associated with the loans; and • increased compliance requirements could result in higher compliance costs, higher foreclosure proceedings or lower loan origination volume, all which could negatively impact future earnings.
Biggest changeDisruption in the market for residential mortgage loans as well as declines in real estate values, among other economic variables, could lead to one or more of the following: • rising interest rates causing a decline in mortgage originations, which could negatively impact our earnings; • reductions in real estate values could decrease the potential for mortgage originations, which could negatively impact our earnings; • our inability to sell mortgage loans on the secondary market could negatively impact our liquidity position; • if it is determined that loans were made in breach of our representations and warranties to the secondary market, we could incur significant losses associated with the loans, including requirements to either repurchase the outstanding principal balance of a loan or make the purchaser whole for the anticipated economic benefits of a loan; and • increased compliance requirements could result in higher compliance costs, higher foreclosure proceedings or lower loan origination volume, all which could negatively impact future earnings.
However, such unrealized losses do not affect our regulatory capital ratios. We actively monitor our available for securities portfolio and do not currently anticipate the need to realize material losses from the sale of securities for liquidity purposes.
However, such unrealized losses do not affect our regulatory capital ratios. We actively monitor our available for sale securities portfolio and do not currently anticipate the need to realize material losses from the sale of securities for liquidity purposes.
De novo branching and any acquisition carry with it numerous risks, including the following: • the inability to obtain all required regulatory approvals; • significant costs and anticipated operating losses associated with establishing a de novo branch or a new bank; • the inability to secure the services of qualified senior management; • the local market may not accept the services of a new bank owned and managed by a bank holding company headquartered outside of the market area of the new bank; 20 • economic downturns in the new market; • the inability to obtain attractive locations within a new market at a reasonable cost; and • the additional strain on management resources and internal systems and controls.
De novo branching and any acquisition carry with it numerous risks, including the following: • the inability to obtain all required regulatory approvals; • significant costs and anticipated operating losses associated with establishing a de novo branch or a new bank; • the inability to secure the services of qualified senior management; • the local market may not accept the services of a new bank owned and managed by a bank holding company headquartered outside of the market area of the new bank; • economic downturns in the new market; • the inability to obtain attractive locations within a new market at a reasonable cost; and • the additional strain on management resources and internal systems and controls.
Nonetheless, our access to liquidity sources could be affected by unrealized losses if securities must be sold at a loss; tangible capital ratios continue to decline from an increase in unrealized losses or realized credit losses; the FHLB or other funding sources reduce capacity; or bank regulators impose restrictions on us that impact the level of interest rates we may pay on deposits or our ability to access brokered deposits.
Nonetheless, our access to liquidity sources could be affected by unrealized losses if securities must be sold at a loss; tangible capital ratios decline from an increase in unrealized losses or realized credit losses; the FHLB or other funding sources reduce capacity; or bank regulators impose restrictions on us that impact the level of interest rates we may pay on deposits or our ability to access brokered deposits.
The regulators also review current and projected capital ratios and levels, the competence, experience and integrity of management and its record of compliance with laws and regulations, the convenience and needs of the communities to be served (including both institutions’ CRA performance history), and the effectiveness of the acquiring institution in combating money laundering activities.
The regulators also review current and projected capital ratios and levels, the competence, experience and integrity of management and its record of compliance with laws and 18 regulations, the convenience and needs of the communities to be served (including both institutions’ CRA performance history), and the effectiveness of the acquiring institution in combating money laundering activities.
ITEM 1A. RISK FACTORS An investment in our Common Stock is subject to risks inherent in our business. The material risks and uncertainties that management believes affect Ameris are described below.
ITEM 1A. RISK FACTORS An investment in our Common Stock is subject to risks inherent in our business. The material risks and uncertainties that management believes currently affect Ameris are described below.
The difference between interest rates charged on interest-earning assets and interest rates paid on interest-bearing liabilities may be affected by 16 changes in market interest rates, changes in relationships between interest rate indices, and changes in the relationships between long-term and short-term market interest rates.
The difference between interest rates charged on interest-earning assets and interest rates paid on interest-bearing liabilities may be affected by changes in market interest rates, changes in relationships between interest rate indices and changes in the relationships between long-term and short-term market interest rates.
In addition, we are heavily dependent on the strength and capability of our technology systems which we use both to interface with our customers and to manage our internal financial and other systems.
In addition, we are heavily dependent on the strength and capability of our technology systems which we use both to interface with our customers and to manage our internal financial 23 and other systems.
Deterioration in economic conditions, including the possibility of a recession, affecting borrowers and securities issuers; inflation; rising interest rates; new information regarding existing loans, credit commitments and securities holdings; natural disasters and risks related to climate change; and identification of additional problem loans, ratings down-grades and other factors, both within and outside of our control, may require an increase in the allowances for credit losses on loans, securities and off-balance sheet credit exposures.
Deterioration in economic conditions, including the possibility of a recession, affecting borrowers and securities issuers; inflation; rising interest rates; new information regarding existing loans, credit commitments and securities holdings; natural disasters and risks related to climate change; and identification of additional problem loans, ratings downgrades and other factors, both within and outside of our control, may require an increase in the allowances for credit losses on loans, securities and off-balance sheet credit exposures.
These acquisitions may not produce revenue or earnings enhancements or cost savings at levels or within timeframes originally anticipated and may result in unforeseen integration difficulties. When appropriate opportunities arise, we will engage in acquisitions of other businesses.
We engage in acquisitions of other businesses from time to time. These acquisitions may not produce revenue or earnings enhancements or cost savings at levels or within timeframes originally anticipated and may result in unforeseen integration difficulties. When appropriate opportunities arise, we will engage in acquisitions of other businesses.
As market interest rates have increased, we have experienced unrealized losses on our available for sale securities portfolio. Unrealized losses related to available for sale securities are reflected in accumulated other comprehensive income in our consolidated balance sheets and reduce the level of our book capital and tangible common equity.
Unrealized losses in our securities portfolio could affect liquidity. 21 As market interest rates have increased, we have experienced unrealized losses on our available for sale securities portfolio. Unrealized losses related to available for sale securities are reflected in accumulated other comprehensive income in our consolidated balance sheets and reduce the level of our book capital and tangible common equity.
We are subject to the regulations of the SEC, the Federal Reserve, the FDIC, the GDBF, the CFPB and other governmental agencies and regulatory bodies. New regulations issued by these agencies may adversely affect our ability to carry on our business activities.
We are subject to the regulations of the SEC, the Federal Reserve, the FDIC, the GDBF, the CFPB and other governmental agencies and regulatory bodies. New regulations issued by these agencies may adversely affect our ability to carry on our business activities. We are also subject to numerous federal and state laws.
Some of our nonbank competitors are not subject to the same extensive regulations that govern us or our bank subsidiary and may have greater flexibility in competing for business. Another competitive factor is that the financial services market, including banking services, is undergoing rapid changes with frequent introductions of new technology-driven products and services.
Some of our non-bank competitors are not subject to the same extensive regulations that govern us or the Bank and may have greater flexibility in competing for business. Another competitive factor is that the financial services market, including banking services, continues to undergo rapid changes with frequent introductions of new technology-driven products and services.
Downgrades in the opinions of the analysts that follow our Company may cause our stock price to fall and significantly limit our ability to access the markets for additional capital. Should these risks materialize, our ability to further expand our operations through internal growth or acquisition may be limited.
Downgrades in the opinions of the analysts that follow our Company may cause our stock price to fall and significantly limit our ability to access the markets for additional capital. Should these risks materialize, our ability to further expand our operations through internal growth or acquisition may be limited. We may be unable to pay dividends on our Common Stock.
In 2023, net interest income made up 77.5% of our revenue. Unexpected movement in interest rates, that may or may not change the slope of the current yield curve, could cause our net interest margins to decrease, subsequently decreasing net interest income. In addition, such changes could materially adversely affect the valuation of our assets and liabilities.
Unexpected movement in interest rates, that may or may not change the slope of the current yield curve, could cause our net interest margins to decrease, subsequently decreasing net interest income. In addition, such changes could materially adversely affect the valuation of our assets and liabilities.
Increases in non-performing loans have resulted in a net loss of earnings from particular loans, an increase in credit loss expense and an increase in loan charge-offs, and these and future instances could have a material adverse effect on our business, financial condition and results of operations. Our allowance for credit losses may be insufficient.
Increases in non-performing loans have resulted in a net loss of earnings from particular loans, an increase in credit loss expense and an increase in loan charge-offs, and these and future instances could have a material adverse effect on our business, financial condition and results of operations.
In the case of off-balance-sheet credit exposures, the allowance for credit losses is a liability account reported as a component of accrued interest payable and other liabilities in our consolidated balance sheets.
In the case of off-balance-sheet credit exposures, the allowance for credit losses is a liability account reported as a component of other liabilities in our consolidated balance sheets.
Failures in our risk management policies, procedures and controls could adversely affect our ability to manage this portfolio going forward and could result in an increased rate of delinquencies in, and increased losses from, this portfolio, which, accordingly, could have a material adverse effect on our business, financial condition and results of operations. We are subject to liquidity risk.
Failures in our risk management policies, procedures and controls could adversely affect our ability to manage this portfolio going forward and could result in an increased rate of delinquencies in, and increased losses from, this portfolio. Any of these results could have a material and adverse effect on our business, financial condition and results of operations.
We maintain allowances for credit losses on loans, securities and off-balance sheet credit exposures. In the case of loans and securities, allowances for credit losses are contra-asset valuation accounts that are deducted from the amortized cost basis of these assets to present the net amount expected to be collected.
In the case of loans and securities, allowances for credit losses are contra-asset valuation accounts that are deducted from the amortized cost basis of these assets to present the net amount expected to be collected.
Furthermore, as we and other regional banking organizations experienced in 2023, the failure of other financial institutions may cause deposit outflows as customers spread deposits among several different banks so as to maximize their amount of FDIC insurance, move deposits to banks deemed "too big to fail" or remove deposits from the banking system entirely.
Furthermore, as banking organizations experienced in recent years, the failure of other financial institutions may cause deposit outflows as customers spread deposits among several different banks so as to maximize their amount of FDIC insurance, move deposits to banks deemed “too big to fail” or remove deposits from the banking system entirely.
Such legislation could change the operating environment of Ameris in substantial and unpredictable ways. If enacted, such legislation could increase or decrease the cost of doing business, limit or expand permissible activities or affect the competitive balance among banks, savings associations, credit unions and other financial institutions.
If enacted, such legislation could increase or decrease the cost of doing business, limit or expand permissible activities or affect the competitive balance among banks, savings associations, credit unions and other financial institutions.
Legislation and regulatory proposals enacted in response to market and economic conditions may materially adversely affect our business and results of operations. The banking industry is heavily regulated. We are subject to examinations, supervision and comprehensive regulation by various federal and state agencies. Our compliance with these regulations is costly and restricts certain of our activities.
Regulatory and Compliance Risk Legislation and regulatory proposals, including those enacted in response to market, economic and political conditions, may materially adversely affect our business and results of operations. The banking industry is heavily regulated. We are subject to examinations, supervision and comprehensive regulation by various federal and state agencies.
These third parties may experience errors or disruptions that could adversely impact us and over which we may have limited control. We also face risk from the integration of new infrastructure platforms and/or new third party providers of such platforms into our existing businesses. Financial services companies depend on the accuracy and completeness of information about customers and counterparties.
These third parties may experience errors or disruptions that could adversely impact us and over which we may have limited control. We also face risk from the integration of new infrastructure platforms and/or new third party providers of such platforms into our existing businesses.
We face competition in our regional market areas from other commercial banks, savings and loan associations, credit unions, internet banks, mortgage companies, finance companies, mutual funds, insurance companies, brokerage and investment banking firms, and other financial intermediaries that offer similar services.
Certain competitors are larger and may have more resources than we do. We face competition in our regional market areas from other commercial banks, savings and loan associations, credit unions, internet banks, mortgage companies, finance companies, mutual funds, insurance companies, brokerage and investment banking firms, fintechs and other financial intermediaries that offer similar services.
Any increase in the allowance for credit losses on loans, securities and/or off-balance sheet credit exposures will result in a decrease in net income and, possibly, capital, and may have a material adverse effect on our business, financial condition and results of operations. We are subject to risk arising from conditions in the commercial real estate market.
Any increase in the allowance for credit losses on loans, securities and/or off-balance sheet credit exposures will result in a decrease in net income and, possibly, capital, and may have a material adverse effect on our business, financial condition and results of operations.
As of December 31, 2023, we had outstanding trust preferred securities and accompanying junior subordinated debentures with a carrying value of $130.3 million and other subordinated notes payable with a carrying value of $291.1 million.
As of December 31, 2024, we had outstanding trust preferred securities and accompanying junior subordinated debentures with a carrying value of $132.3 million and other subordinated notes payable with a carrying value of $108.8 million.
We require liquidity to meet our deposit and debt obligations as they come due. Our access to funding sources in amounts adequate to finance our activities or on terms that are acceptable to us could be impaired by factors that affect us specifically or the financial services industry or economy generally.
Our access to funding sources in amounts adequate to finance our activities or on terms that are acceptable to us could be impaired by factors that affect us specifically or the financial services industry or economy generally.
We also may need additional debt or equity financing in the future to fund acquisitions. We may not be able to obtain additional financing or, if available, it may not be in amounts and on terms acceptable to us.
We may not be able to obtain additional financing or, if available, it may not be in amounts and on terms acceptable to us.
RISKS RELATED TO OUR COMPANY AND INDUSTRY Our revenues are highly correlated to market interest rates. Our assets and liabilities are primarily monetary in nature, and as a result, we are subject to significant risks tied to changes in interest rates. Our ability to operate profitably is largely dependent upon net interest income.
Our assets and liabilities are primarily monetary in nature, and as a result, we are subject to significant risks tied to changes in interest rates. Our ability to operate profitably is largely dependent upon net interest income. In 2024, net interest income made up 74.3% of our revenue.
If the liquidity of the Nasdaq market should fail to operate at a time when we may seek to raise equity capital, or if conditions in the capital markets are adverse, we may be constrained in raising capital.
Our Common Stock is listed and traded on the New York Stock Exchange (the “NYSE”). If the liquidity of the NYSE market should fail to operate at a time when we may seek to raise equity capital, or if conditions in the capital markets are adverse, we may be constrained in raising capital.
Additionally, information security may be adversely affected by the current or anticipated impact of military conflict, including the current wars in Ukraine and Israel, acts of terrorism or other geopolitical events. 18 Information security risks for financial institutions like us continue to increase in part because of new technologies, the use of the Internet and telecommunications technologies (including mobile devices) to conduct financial and other business transactions and the increased sophistication and activities of organized crime, perpetrators of fraud, hackers, terrorists and others.
Information security risks for financial institutions like us continue to increase in part because of new technologies, the use of the Internet and telecommunications technologies (including mobile devices) to conduct financial and other business transactions and the increased sophistication and activities of organized crime, perpetrators of fraud, hackers, terrorists and others.
In addition, we are required to pay interest on our senior debt, subordinated debt and junior subordinated debentures issued in connection with the Company’s trust preferred securities before we pay any dividends on our Common Stock.
In addition, we are required to pay interest on our senior debt, 22 subordinated debt and junior subordinated debentures issued in connection with the Company’s trust preferred securities before we pay any dividends on our Common Stock. Operational Risk Cyberattacks or other security breaches could have a material adverse effect on our business.
To the extent we are involved in any future cyberattacks or other breaches, our brand and reputation could be affected, which could also have a material adverse effect on our business, financial condition or results of operations. Our business is highly correlated to local economic conditions in a geographically concentrated part of the United States.
To the extent we are involved in any future cyberattacks or other breaches, our brand and reputation could be affected, which could also have a material adverse effect on our business, financial condition or results of operations. We face risks related to our operational, technological and organizational infrastructure.
Additionally, significant unrealized losses could negatively impact market and/or customer perceptions of the Company, which could lead to a loss of depositor confidence and an increase in deposit withdrawals, particularly among those with uninsured deposits. Cyberattacks or other security breaches could have a material adverse effect on our business.
Additionally, significant unrealized losses could negatively impact market and/or customer perceptions of the Company, which could lead to a loss of depositor confidence and an increase in deposit withdrawals, particularly among those with uninsured deposits. We may need to rely on the financial markets to provide needed capital.
Reliance on inaccurate or misleading financial statements, credit reports or other financial information could have a material adverse impact on the Company’s business and, in turn, the Company’s financial condition and results of operations. Reputational risk and social factors may impact our results.
Reliance on inaccurate or misleading financial statements, credit reports or other financial information could have a material adverse impact on the Company’s business and, in turn, the Company’s financial condition and results of operations. Our business could suffer if we fail to attract and retain experienced people and maintain our culture.
As of December 31, 2023, commercial real estate mortgage loans comprised approximately 39.8% of our loan portfolio. Commercial real estate mortgage loans generally involve a greater degree of credit risk than residential real estate mortgage 17 loans because they typically have larger balances and are more affected by adverse conditions in the economy.
We are subject to risk arising from conditions in the commercial real estate market. Commercial real estate mortgage loans generally involve a greater degree of credit risk than residential real estate mortgage loans because they typically have larger balances and are more affected by adverse conditions in the economy.
We are subject to various federal and state laws and certain changes in these laws and regulations may adversely affect our operations. Noncompliance with certain of these regulations may impact our business plans, including our ability to branch, offer certain products or execute existing or planned business strategies.
Noncompliance with certain of these laws and regulations may impact our business plans, including our ability to branch, complete acquisitions, offer certain products or services or execute existing or planned business strategies.
Fiscal policy, the other principal tool of the federal government to oversee the national economy is largely in the hands of Congress through its authority to make taxation and budget decisions, subject to Presidential approval.
Fiscal policy, the other principal tool of the federal government to oversee the national economy, is largely in the hands of Congress through its authority to make taxation and budget decisions, subject to Presidential approval. These decisions may have a significant impact on the economic sectors in which we operate and could adversely affect our results of operations.
Loan originations, and potentially loan revenues, could be materially adversely impacted by sharply rising interest rates. Conversely, sharply falling rates could increase prepayments within our securities portfolio lowering interest earnings from those investments. Rising inflation could cause our operating costs related to salaries and benefits, technology and supplies to increase at a faster pace than our revenues.
Loan originations, and potentially loan revenues, could be materially adversely impacted by sharply rising interest rates. Conversely, sharply falling rates could increase prepayments within our loan and securities portfolios lowering interest earnings from those assets and investments.
Also, the Company’s right to participate in a distribution of assets upon a subsidiary’s liquidation or reorganization is subject to the prior claims of the subsidiary’s creditors.
Various federal and state laws and regulations limit the amount of dividends that the Bank may pay to the Company. Also, the Company’s right to participate in a distribution of assets upon a subsidiary’s liquidation or reorganization is subject to the prior claims of the subsidiary’s creditors.
We may seek to supplement our internal growth through acquisitions. We cannot predict with certainty the number, size or timing of acquisitions, or whether any such acquisitions will occur at all. Our acquisition efforts have traditionally focused on targeted banking entities in markets in which we currently operate and markets in which we believe we can compete effectively.
We may seek to supplement our internal growth through acquisitions. We cannot predict with certainty the number, size or timing of acquisitions, or whether any such acquisitions will occur at all.
Depending on the condition of any institution that we may acquire, any acquisition may, at least in the near term, materially adversely affect our capital and earnings and, if not successfully integrated following the acquisition, may continue to have such effects. Natural disasters, geopolitical events, public health crises and other catastrophic events beyond our control could adversely affect us.
Depending on the condition of any institution that we may acquire, any acquisition may, at least in the near term, materially adversely affect our capital and earnings and, if not successfully integrated following the acquisition, may continue to have such effects. 19 Credit and Liquidity Risk Our revenues are highly correlated to market interest rates.
You may not receive dividends on the Common Stock. Holders of our Common Stock are only entitled to receive such dividends as our Board may declare out of funds legally available for such payments.
Holders of our Common Stock are only entitled to receive such dividends as our Board may declare out of funds legally available for such payments. Although we have consistently paid dividends on our Common Stock in recent years, the payment of dividends could be suspended at any time.
However, as consolidation of the financial services industry continues, the competition for suitable acquisition candidates may increase. We may compete with other financial services companies for acquisition opportunities, and many of these competitors have greater financial resources than we do and may be able to pay more for an acquisition than we are able or willing to pay.
We may compete with other financial services companies for both bank and non-bank acquisition opportunities, and many of these competitors have greater financial resources than we do and may be able to pay more for an acquisition than we are able or willing to pay. We also may need additional debt or equity financing in the future to fund acquisitions.
We have experienced to some extent many of these risks with our de novo branching to date. We rely on dividends from the Bank for most of our revenue. Ameris is a separate and distinct legal entity from its subsidiaries. It receives substantially all of its revenue from dividends from the Bank.
We rely on dividends from the Bank for most of our revenue. Ameris is a separate and distinct legal entity from its subsidiaries. It receives substantially all of its revenue from dividends from the Bank. These dividends are the principal source of funds to pay dividends on the Common Stock and interest and principal on the Company’s debt.
Additionally, financial markets may be adversely affected by the current or anticipated impact of military conflict, including the current wars in Ukraine and Israel, acts of terrorism or other geopolitical events. RISKS RELATED TO OUR COMMON STOCK The price of our Common Stock is volatile and may decline.
Additionally, financial markets may be adversely affected by the current or anticipated impact of military conflict, acts of terrorism or other geopolitical events.
As of December 31, 2023, approximately 43.7% of our deposits were uninsured, and we rely on these deposits for liquidity. A failure to maintain adequate liquidity could have a material adverse effect on our business, financial condition and results of operations. Unrealized losses in our securities portfolio could affect liquidity.
As of December 31, 2024, approximately 46.8% of our deposits were uninsured, and we rely on these deposits for liquidity. A failure to maintain adequate liquidity could have a material adverse effect on our business, financial condition and results of operations. 20 We face additional risks due to our mortgage banking activities that could negatively impact our liquidity and earnings.
A change in statutes, regulations or regulatory policies applicable to the Company or the Bank could have a material effect on the business of the Company. Our growth and financial performance may be negatively impacted if we are unable to successfully execute our growth plans.
A change in statutes, regulations or regulatory policies applicable to the Company or the Bank could have a material effect on the business of the Company.
Unlike larger organizations that are more geographically diversified, our banking offices are primarily concentrated in select markets in Georgia, Alabama, Florida, North Carolina and South Carolina. As a result of this geographic concentration, our financial results depend largely upon economic conditions in these market areas.
Market and General Risk Our business is highly correlated to local economic conditions in a geographically concentrated part of the United States. Unlike larger organizations that are more geographically diversified, our banking offices are primarily concentrated in select markets in Georgia, Alabama, Florida, North Carolina and South Carolina.
In addition, from time to time, various legislative and regulatory initiatives are introduced in Congress and state legislatures, or by regulatory agencies, that may impact the Company or the Bank. Such initiatives may include proposals to expand or contract the powers of bank holding companies and depository institutions or proposals to substantially change the financial institution regulatory system.
Such initiatives may include proposals to expand or contract the powers of bank holding companies and depository institutions or proposals to substantially change the financial institution regulatory system. Such legislation could change the operating environment of Ameris in substantial and unpredictable ways.
Our future success may depend, in part, on our ability to use technology competitively to provide products and services that provide convenience to customers and create additional efficiencies in our operations. Changes in the policies of monetary authorities and other government action could materially adversely affect our profitability. Banking is a business which depends on interest rate differentials for success.
Our future success may depend, in part, on our ability to use technology competitively to provide products and services that provide convenience to customers and create additional efficiencies in our operations.
Any of these laws or regulations may be modified or changed from time to time, and we cannot be assured that such modifications or changes will not adversely affect us. We are subject to industry competition which may have an impact upon our success. Our profitability depends on our ability to compete successfully.
Any of these rules or regulations may be modified or changed from time to time, and we cannot be assured that such modifications or changes will not adversely affect us. We may become subject to enforcement actions even though noncompliance was inadvertent or unintentional.
Recently, inflation has been at a higher level than experienced in many decades, which has increased costs and impacted operations for the Company and many of its customers. The fair market value of our securities portfolio and the investment income from these securities also fluctuate depending on general economic and market conditions.
The fair market value of our securities portfolio and the investment income from these securities also fluctuate depending on general economic and market conditions.
Banking regulations are primarily intended to protect the broader banking system, the FDIC’s Deposit Insurance Fund and depositors, not shareholders. The burden imposed by federal and state regulations puts banks at a competitive disadvantage compared to less regulated competitors such as finance companies, mortgage banking companies and leasing companies.
The burden imposed by federal and state regulations puts banks at a competitive disadvantage compared to less regulated competitors such as finance companies, mortgage banking companies and leasing companies. In addition, from time to time, various legislative and regulatory initiatives are introduced in Congress and state legislatures, or by regulatory agencies, that may impact the Company or the Bank.
Consequently, cash-based activities, including further investments in the Bank or in support of the Bank, could require borrowings or additional issuances of common or preferred stock. We are subject to regulation by various federal and state entities.
Consequently, cash-based activities, including further investments in the Bank or in support of the Bank, could require borrowings or additional issuances of common or preferred stock. Our allowance for credit losses may be insufficient. We maintain allowances for credit losses on loans, securities and off-balance sheet credit exposures.
We face additional risks due to our mortgage banking activities that could negatively impact net income and profitability. We sell the majority of the mortgage loans that we originate. The sale of these loans generates noninterest income and can be a source of liquidity for the Bank.
The sale of these loans generates noninterest income and can be a source of liquidity for the Bank.
Adverse developments with respect to the consumer or other external perceptions regarding the practices of our competitors, or our industry as a whole, may also adversely impact our reputation. In addition, adverse reputational impacts on third parties with whom we have important relationships may also adversely impact our reputation.
Negative public opinion about the financial services industry generally, including with respect to the types of banking products and services we provide, or us specifically could adversely affect our reputation and our ability to keep and attract customers and employees. In addition, adverse reputational impacts on third parties with whom we have important relationships may also adversely impact our reputation.
Removed
In recent years, commercial real estate markets have been particularly impacted by the economic disruption resulting from the COVID-19 pandemic, which has also been a catalyst for the evolution of various remote work options that could impact the long-term performance of some types of office properties within our commercial real estate portfolio.
Added
Strategic Risk We are subject to significant industry competition which may have adversely affect our success. We operate in a highly competitive financial services environment, with our profitability dependent upon our ability to compete successfully based on such factors as brand recognition and reputation, client relationships, product offerings, pricing, convenience, technology, accessibility and customer service.
Removed
Accordingly, the federal banking regulatory agencies have expressed concerns about weaknesses in the current commercial real estate market.
Added
We face significant pricing competition for loans and deposits. For us to successfully compete for borrowers and depositors, we may be required to offer loan and deposit products on terms that are less favorable to us, such as lower interest rates on loans and higher interest rates on deposits.
Removed
These dividends are the principal source of funds to pay dividends on the Common Stock and interest and principal on the Company’s debt. Various federal and state laws and regulations limit the amount of dividends that the Bank may pay to the Company.
Added
Our growth and financial performance may be negatively impacted if we are unable to successfully execute our growth plans, including with respect to any strategic acquisitions we may choose to pursue.
Removed
We operate in a highly competitive financial services environment. Certain competitors are larger and may have more resources than we do.
Added
Our acquisition efforts have traditionally focused on targeted banking entities in markets in which we currently operate and markets in which we believe we can compete effectively, as well as non-bank entities that we feel can successfully supplement our existing lines of business. However, as consolidation of the financial services industry continues, the competition for suitable acquisition candidates may increase.
Removed
These decisions may have a significant impact on the economic sectors in which we operate and could adversely affect our results of operations. 21 We may need to rely on the financial markets to provide needed capital. Our Common Stock is listed and traded on the Nasdaq Global Select Market (“Nasdaq”).
Added
We have experienced to some extent many of these risks with our de novo branching to date. Changes in the policies of monetary authorities and other government action could materially adversely affect our profitability. Banking is a business which depends on interest rate differentials for success.
Removed
We may invest or spend the proceeds in stock offerings in ways with which you may not agree and in ways that may not earn a profit. We may choose to use the proceeds of future stock offerings for general corporate purposes, including for possible acquisition opportunities that may become available.
Added
Rising inflation could cause our operating costs related to salaries and benefits, technology and supplies to increase at a faster pace than our revenues. Recently, inflation has been at a higher level than experienced in many decades, which has increased costs and impacted operations for the Company and many of its customers.
Removed
It is not known whether suitable acquisition opportunities may become available or whether we will be able to successfully complete any such acquisitions. We may use the proceeds of an offering only to focus on sustaining our organic, or internal, growth or for other purposes.
Added
If we lose or are unable to grow and retain our deposits, we may be subject to liquidity risk and higher funding costs. We require liquidity to meet our deposit and debt obligations as they come due.
Removed
In addition, we may use all or a portion of the proceeds of an offering to support our capital. You may not agree with the ways we decide to use the proceeds of any stock offerings, and our use of the proceeds may not yield any profits. We face risks related to our operational, technological and organizational infrastructure.
Added
One of our primary business operations is mortgage banking, in connection with which residential mortgage loans are sold by the Bank in the secondary market under agreements that contain representations and warranties related to, among other things, the origination and characteristics of the mortgage loans.
Removed
Our ability to originate and maintain accounts is highly dependent upon customer and other external perceptions of our business practices and our financial health. Adverse perceptions regarding our business practices or our financial health could damage our reputation in both the customer and funding markets, leading to difficulties in generating and maintaining accounts as well as in financing them.
Added
Additionally, information security may be adversely affected by the current or anticipated impact of military conflict, acts of terrorism or other geopolitical events.
Removed
Adverse impacts on our reputation, or the reputation of our industry, may also result in greater regulatory or legislative scrutiny, which may lead to laws, regulations or regulatory actions that may change or constrain the manner in which we engage with our customers and the products we offer. Adverse reputational impacts or events may also increase our litigation risk.
Added
Fraud remains an elevated risk for us and for all banks, and we may experience increased losses due to fraud. In recent years, fraud risk has continued to be a significant risk for us and for all banks.
Removed
We carefully monitor internal and external developments for areas of potential reputational risk and have established governance structures to assist in evaluating such risks in our business practices and decisions, but we cannot be certain that our efforts will completely mitigate these risks. 22 We may not be able to attract and retain skilled people.
Added
Card fraud and deposit fraud (such as check kiting and wire fraud) continue to be significant sources of fraud attempts and losses in our consumer banking business. Moreover, our commercial clients have experienced increased levels of financial fraud risk as well, often requiring our involvement and assistance because of our banking relationship with these clients.
Removed
The Company’s success depends, in large part, on its ability to attract and retain key people. Competition for the best people in most activities engaged in by the Company can be intense, and the Company may not be able to hire people or to retain them.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeThis area’s roles and responsibilities include cybersecurity risk assessment, vulnerability assessment, defensive operations, threat intelligence and identity access governance, as well as coordination with our Business Continuity Director for additional risk assessment, incident response and business resilience.
Biggest changeThe roles and responsibilities of the CISO's department include delivering and operating security capabilities and controls to detect, identify, protect against and recover from cyberattacks, as well as coordination with our Business Continuity Director for additional risk assessment, incident response and business resilience.
We have designed and maintain a comprehensive, risk-based program in accordance with applicable regulatory standards for identifying and overseeing cybersecurity risks, among others, presented by third parties with whom we engage for the conduct of our business, including vendors, service providers and other external users of our systems, as well as the systems of third parties that could adversely impact our business in the event of a cybersecurity incident affecting those third-party systems. 25 • Education and Awareness.
We have designed and maintain a comprehensive, risk-based program in accordance with applicable regulatory standards for identifying and overseeing cybersecurity risks, among others, presented by third parties with whom we engage for the conduct of our business, including vendors, service providers and other external users of our systems, as well as the systems of third parties that could adversely impact our business in the event of a cybersecurity incident affecting those third-party systems. • Education and Awareness.
We regularly engage third parties to perform assessments on our cybersecurity measures, including information security maturity assessments, audits and independent reviews of our information security control environment and operating effectiveness.
We regularly engage third parties to perform assessments on our cybersecurity measures, including information security maturity assessments, audits and independent reviews of our 31 information security control environment and operating effectiveness.
We deploy technical safeguards that are designed to protect the Company’s information systems from cybersecurity threats, including firewalls, intrusion prevention and detection systems, anti-malware functionality and access controls, which are evaluated and improved through vulnerability assessments and cybersecurity threat intelligence. • Third-Party Risk Management.
We deploy technical safeguards that are designed to protect the Company’s information systems from cybersecurity threats, including authentication and access, firewalls, intrusion prevention and detection systems, anti-malware functionality and data protection controls, which are evaluated and improved through vulnerability assessments and cybersecurity threat intelligence. • Third-Party Risk Management.
Our Corporate Information Security Officer and our Chief Information Officer, to whom the Corporate Information Security Officer reports, as well as key members of their teams, regularly collaborate with peer banks, industry groups and others to consider cybersecurity and incident response issues, trends and best practices.
Our Corporate Information Security Officer and our Chief Information Officer, to whom the Corporate Information Security Officer reports, as well as key members of their teams, regularly collaborate with peer banks, industry groups and others to consider cybersecurity trends and best practices.
Our Corporate Information Security Officer, who holds relevant degrees and certifications and has more than 15 years of information technology and information security experience specific to the financial services industry, is charged with managing our enterprise information security function and administering our information security program.
Our Corporate Information Security Officer ("CISO"), who has relevant degrees and more than 17 years of information technology and information security experience, including five years in the financial services industry, manages our enterprise information security function and administers our information security program.
As one of the critical elements of our overall ERM approach, our cybersecurity program includes a focus on the following key areas: • Governance.
In addition, our team leverages managed security service providers to supplement the Company's internal skillsets and capabilities. As one of the critical elements of our overall ERM approach, our cybersecurity program includes a focus on the following key areas: • Governance.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeAmeris also operates 32 mortgage and loan production offices, all of which are subject to building leases. At December 31, 2023, there were no significant encumbrances on the offices, equipment or other operational facilities owned by Ameris and the Bank. We believe that our properties are suitable for the purposes of our operations. 26
Biggest changeAmeris also operates 30 mortgage and loan production offices, all of which are subject to building leases. At December 31, 2024, there were no significant encumbrances on the offices, equipment or other operational facilities owned by Ameris and the Bank. We believe that our properties are suitable for the purposes of our operations.
The Company also leases approximately 38,000 square feet in Jacksonville, Florida used for additional corporate support services. Inclusive of the branch at its headquarters, Ameris operates 164 branch locations. Of the 164 branch locations, 137 are owned and 27 are subject to either building or ground leases.
The Company also leases approximately 15,000 square feet in Jacksonville, Florida used for additional corporate support services. Inclusive of the branch at its headquarters, Ameris operates 164 branch locations. Of the 164 branch locations, 137 are owned and 27 are subject to either building or ground leases.
ITEM 2. PROPERTIES The Company’s corporate headquarters is located at 3490 Piedmont Road N.E., Suite 1550, Atlanta, Georgia 30305. The Company occupies approximately 19,200 square feet at this location plus an additional 90,800 square feet used for a branch location and support services for banking operations, including credit, marketing and operational support.
ITEM 2. PROPERTIES The Company’s corporate headquarters is located at 3490 Piedmont Road N.E., Suite 1550, Atlanta, Georgia 30305. The Company occupies approximately 19,200 square feet at this location plus an additional 82,600 square feet approximately used for a branch location and support services for banking operations, including credit, marketing and operational support.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeITEM 3. LEGAL PROCEEDINGS Disclosure concerning legal proceedings can be found in Item 8. "Financial Statements and Supplementary Data, Notes to Consolidated Financial Statements, Note 19. Commitments and Contingent Liabilities" under the caption, "Litigation and Regulatory Contingencies," which is incorporated herein by reference. ITEM 4. MINE SAFETY DISCLOSURES Not applicable. 27 PART II
Biggest changeITEM 3. LEGAL PROCEEDINGS Disclosure concerning legal proceedings can be found in Item 8. "Financial Statements and Supplementary Data, Notes to Consolidated Financial Statements, Note 18. Commitments and Contingent Liabilities" under the caption, "Litigation and Regulatory Contingencies," which is incorporated herein by reference. ITEM 4. MINE SAFETY DISCLOSURES Not applicable. 32 PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

4 edited+3 added−6 removed1 unchanged
Biggest changePeriod Ending Index 12/31/2018 12/31/2019 12/31/2020 12/31/2021 12/31/2022 12/31/2023 Ameris Bancorp 100.00 136.06 124.77 164.72 158.41 181.02 NASDAQ Stock Market (US Companies) 100.00 136.69 198.10 242.03 163.28 236.17 KBW NASDAQ Bank Stocks 100.00 136.13 122.09 168.88 132.75 131.57 Source: S&P Global Market Intelligence Pursuant to the regulations of the SEC, this performance graph is not “soliciting material,” is not deemed filed with the SEC and is not to be incorporated by reference in any filing of the Company under the Securities Act or the Exchange Act.
Biggest changeIn future periods, we will no longer reference the KBW Nasdaq Bank Index in comparing total shareholder returns on the Common Stock. 33 Period Ending Index 12/31/2019 12/31/2020 12/31/2021 12/31/2022 12/31/2023 12/31/2024 Ameris Bancorp 100.00 91.70 121.06 116.42 133.04 158.80 NYSE Composite Index 100.00 106.99 129.11 117.04 133.16 154.19 Nasdaq Composite Index 100.00 144.92 177.06 119.45 172.77 223.87 KBW Nasdaq Regional Banking Index 100.00 91.29 124.74 116.10 115.64 130.90 KBW Nasdaq Bank Index 100.00 89.69 124.06 97.52 96.65 132.60 Source: S&P Global Market Intelligence Pursuant to the regulations of the SEC, this performance graph is not “soliciting material,” is not deemed filed with the SEC and is not to be incorporated by reference in any filing of the Company under the Securities Act or the Exchange Act.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market for Our Common Stock The Common Stock is listed on Nasdaq under the symbol “ABCB”. As of February 20, 2024, there were approximately 2,644 holders of record of the Common Stock.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market for Our Common Stock The Common Stock is listed on the NYSE under the symbol “ABCB”. As of February 21, 2025, there were approximately 2,423 holders of record of the Common Stock.
Companies) index and the index of KBW NASDAQ Bank Stocks for the five-year period commencing December 31, 2018 and ending December 31, 2023. This line graph assumes an investment of $100 on December 31, 2018, and reinvestment of dividends and other distributions to shareholders.
This line graph assumes an investment of $100 on December 31, 2019, and reinvestment of dividends and other distributions to shareholders. In 2023, because our Common Stock was traded on Nasdaq, we used the Nasdaq Composite Index as our broad equity market index.
The Company is required to comply with the restrictions on the payment of dividends in respect of the Common Stock discussed in the section of Part I, Item 1 of this Annual Report captioned “Payment of Dividends and Other Restrictions.” Repurchases of Common Stock The following table provides information with respect to purchases made by or on behalf of the Company or any “affiliated purchaser” (as defined in Rule 10b-18(a)(3) under the Exchange Act) of our Common Stock during the three-month period ended December 31, 2023.
The Company is required to comply with the restrictions on the payment of dividends in respect of the Common Stock discussed in the section of Part I, Item 1 of this Annual Report captioned “Payment of Dividends and Other Restrictions.” Performance Graph Set forth below is a line graph comparing the change in the cumulative total shareholder return on the Common Stock against the cumulative return of the NYSE Composite Index, the Nasdaq Composite Index, KBW Nasdaq Regional Banking Index and the KBW Nasdaq Bank Index for the five-year period commencing December 31, 2019 and ending December 31, 2024.
Removed
Period Total Number of Shares Purchased (1) Average Price Paid Per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Approximate Dollar Value of Shares That May Yet be Purchased Under the Plans or Programs (2) October 1, 2023 through October 31, 2023 60,761 $ 37.37 60,000 $ 97,759,204 November 1, 2023 through November 30, 2023 26,400 $ 37.71 26,400 $ 96,763,673 December 1, 2023 through December 31, 2023 — $ — — $ 96,763,673 Total 87,161 $ 37.47 86,400 $ 96,763,673 (1) The shares purchased from October 1, 2023 through October 31, 2023 include 761 shares of common stock surrendered to the Company in payment of the income tax withholding obligations relating to the vesting of shares of restricted stock.
Added
As previously disclosed, we voluntarily transferred the listing of our Common Stock to the NYSE on July 23, 2024. As a result, we have changed our broad equity market index for purposes of disclosure in the stock performance graph to the NYSE Composite Index and have included returns in the stock performance graph based on both of these indices.
Removed
(2) On September 19, 2019, the Company announced that its board of directors authorized the Company to repurchase up to $100.0 million of its outstanding common stock through October 31, 2020.
Added
In future periods, we will no longer reference the Nasdaq Composite Index in comparing total shareholder returns on the Common Stock.
Removed
The Board has subsequently extended the share repurchase program each year since the original authorization, with the most recent extension, which also included the replenishment of the program to $100.0 million, being announced on October 26, 2023. As a result, the Company is currently authorized to engage in additional share repurchases totaling up to $100.0 million through October 31, 2024.
Added
We have also changed our line-of-business index from the KBW Nasdaq Bank Index, which we used in 2023, to the KBW Nasdaq Regional Banking Index, which consists of a peer group of companies that is used by the Company in our executive compensation program. We have included returns in the stock performance graph based on both of these indices.
Removed
Repurchases of shares must be made in accordance with applicable securities laws and may be made from time to time in the open market or by negotiated transactions. The amount and timing of repurchases will be based on a variety of factors, including share acquisition price, regulatory limitations and other market and economic factors.
Removed
The program does not require the Company to repurchase any specific number of shares.
Removed
As of December 31, 2023, an aggregate of $3.2 million, or 86,400 shares of the Company's common stock, had been repurchased under the program's October 26, 2023 renewal, which also included the replenishment of the program to $100.0 million. 28 Performance Graph Set forth below is a line graph comparing the change in the cumulative total shareholder return on the Common Stock against the cumulative return of the NASDAQ Stock Market (U.S.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

101 edited+16 added−21 removed62 unchanged
Biggest changeAccretion expense for 2022 was $285,000, compared with accretion income of $16.3 million for 2021. 36 The summary of changes in interest income and interest expense on a fully taxable equivalent basis resulting from changes in volume and changes in rates for each category of earning assets and interest-bearing liabilities for the years ended December 31, 2023 and 2022 are shown in the following table: 2023 vs. 2022 2022 vs. 2021 Increase Changes Due To Increase Changes Due To (dollars in thousands) (Decrease) Rate Volume (Decrease) Rate Volume Increase (decrease) in: Income from earning assets: Interest on interest-bearing deposits in banks $ 24,928 $ 37,379 $ (12,451) $ 19,128 $ 20,301 $ (1,173) Interest on federal funds sold (77) — (77) 35 54 (19) Interest on time deposits in other banks — — — (2) — (2) Interest on investment securities - taxable 24,346 7,676 16,670 12,132 3,881 8,251 Interest on investment securities - nontaxable 201 130 71 761 26 735 Interest on loans held for sale 12 9,705 (9,693) (12,952) 8,758 (21,710) Interest and fees on loans 337,050 215,512 121,538 170,965 48,741 122,224 Total interest income 386,460 270,402 116,058 190,067 81,761 108,306 Expense from interest-bearing liabilities: Interest expense on interest-bearing deposits Interest on NOW accounts 55,217 54,426 791 10,953 10,677 276 Interest on MMDA accounts 129,575 127,931 1,644 25,296 25,019 277 Interest on savings accounts 5,062 5,151 (89) 784 715 69 Interest on retail time deposits 56,342 54,398 1,944 (3,267) (1,378) (1,889) Interest on brokered time deposits 53,716 53,716 — (18) — (18) Total interest expense on interest-bearing deposits 299,912 295,622 4,290 33,748 35,033 (1,285) Interest expense on non-deposit funding Interest on federal funds purchased and securities sold under agreements to repurchase (4) — (4) (16) — (16) Interest on FHLB advances 49,592 17,244 32,348 8,935 5,281 3,654 Interest on other borrowings (2,339) 988 (3,327) (69) 225 (294) Interest on trust preferred securities 5,370 5,247 123 2,477 2,392 85 Total interest expense on non-deposit funding 52,619 23,479 29,140 11,327 7,898 3,429 Total interest expense 352,531 319,101 33,430 45,075 42,931 2,144 Net interest income $ 33,929 $ (48,699) $ 82,628 $ 144,992 $ 38,830 $ 106,162 Provision for Credit Losses The Company's provision for credit losses on loans during 2023 amounted to $153.5 million, compared with $52.6 million for 2022 and a release of $35.1 million for 2021.
Biggest changeThe Company’s net interest margin, on a tax equivalent basis, decreased 15 basis points to 3.61% for the year ended December 31, 2023, compared with 3.76% for the year ended December 31, 2022. 40 The summary of changes in interest income and interest expense on a fully taxable equivalent basis resulting from changes in volume and changes in rates for each category of earning assets and interest-bearing liabilities for the years ended December 31, 2024 and 2023 are shown in the following table: 2024 vs. 2023 2023 vs. 2022 Increase Changes Due To Increase Changes Due To (dollars in thousands) (Decrease) Rate Volume (Decrease) Rate Volume Increase (decrease) in: Income from earning assets: Interest on interest-bearing deposits in banks $ 1,970 $ 1,167 $ 803 $ 24,928 $ 37,379 $ (12,451) Interest on federal funds sold — — — (77) — (77) Interest on investment securities - taxable 2,516 1,599 917 24,346 7,676 16,670 Interest on investment securities - nontaxable 4 15 (11) 201 130 71 Interest on loans held for sale 4,821 947 3,874 12 9,705 (9,693) Interest and fees on loans 88,588 54,195 34,393 337,050 215,512 121,538 Total interest income 97,899 57,923 39,976 386,460 270,402 116,058 Expense from interest-bearing liabilities: Interest expense on interest-bearing deposits Interest on NOW accounts 11,644 12,612 (968) 55,217 54,426 791 Interest on MMDA accounts 68,347 37,725 30,622 129,575 127,931 1,644 Interest on savings accounts (2,569) (1,483) (1,086) 5,062 5,151 (89) Interest on retail time deposits 39,022 26,207 12,815 56,342 54,398 1,944 Interest on brokered time deposits 12,212 (912) 13,124 53,716 — 53,716 Total interest expense on interest-bearing deposits 128,656 74,149 54,507 299,912 241,906 58,006 Interest expense on non-deposit funding Interest on federal funds purchased and securities sold under agreements to repurchase — — — (4) — (4) Interest on FHLB advances (42,721) 163 (42,884) 49,592 17,244 32,348 Interest on other borrowings (2,557) (1,162) (1,395) (2,339) 988 (3,327) Interest on trust preferred securities 325 122 203 5,370 5,247 123 Total interest expense on non-deposit funding (44,953) (877) (44,076) 52,619 23,479 29,140 Total interest expense 83,703 73,272 10,431 352,531 265,385 87,146 Net interest income $ 14,196 $ (15,349) $ 29,545 $ 33,929 $ 5,017 $ 28,912 Provision for Credit Losses The Company's provision for credit losses on loans during 2024 amounted to $69.8 million, compared with $153.5 million for 2023 and $52.6 million for 2022.
This process involves estimating our actual current tax exposure together with assessing temporary differences resulting from differing treatment of items, such as the provision for credit losses and gains on FDIC- 33 assisted transactions, for tax and financial reporting purposes. These differences result in deferred tax assets and liabilities that are included in our consolidated balance sheet.
This process involves estimating our actual current tax exposure together with assessing temporary differences resulting from differing treatment of items, such as the provision for credit losses and gains on FDIC-assisted transactions, for tax and financial reporting purposes. These differences result in deferred tax assets and liabilities that are included in our consolidated balance sheet.
Past due loans are placed on nonaccrual status when principal or interest is past due 90 days or more unless the loan is well secured and in the process of 44 collection. In some cases, where borrowers are experiencing financial difficulties, loans may be restructured to provide terms significantly different from the original contractual terms.
Past due loans are placed on nonaccrual status when principal or interest is past due 90 days or more unless the loan is well secured and in the process of collection. In some cases, where borrowers are experiencing financial difficulties, loans may be restructured to provide terms significantly different from the original contractual terms.
Noninterest income from the Company's warehouse lending division was $3.5 million for 2023 compared with $4.5 million for 2022. Other service charges, commission and fees increased by $526,000 to $4.4 million during 2023, an increase of 13.6% compared with 2022 due primarily to an increase in ATM fees.
Noninterest income from the Company's warehouse lending division was $3.5 million for 2023 compared with $4.5 million for 2022. 42 Other service charges, commission and fees increased by $526,000 to $4.4 million during 2023, an increase of 13.6% compared with 2022 due primarily to an increase in ATM fees.
Net interest income is the largest component of our income and is affected by the interest rate environment and the volume and composition of interest-earning assets and interest-bearing liabilities. Our interest-earning assets include loans, investment securities, other investments, interest-bearing deposits in banks, federal funds sold and time deposits in other banks.
Net interest income is the largest component of our income and is affected by the interest rate environment and the volume and composition of interest-earning assets and interest-bearing liabilities. Our interest-earning assets include loans, investment securities, other investments, interest-bearing deposits in banks and federal funds sold.
The following statistical information should be read in conjunction with the remainder of “Management’s Discussion and Analysis of Financial Condition and Results of Operation” and the consolidated financial statements and related notes included elsewhere in this Annual Report and in the documents incorporated herein by reference. 34 The following tables set forth the amount of average balance, interest income or interest expense, and average interest rate for each category of interest-earning assets and interest-bearing liabilities, net interest spread and net interest margin on average interest-earning assets.
The following statistical information should be read in conjunction with the remainder of “Management’s Discussion and Analysis of Financial Condition and Results of Operation” and the consolidated financial statements and related notes included elsewhere in this Annual Report and in the documents incorporated herein by reference. 38 The following tables set forth the amount of average balance, interest income or interest expense, and average interest rate for each category of interest-earning assets and interest-bearing liabilities, net interest spread and net interest margin on average interest-earning assets.
The allowance for unfunded commitments on off-balance sheet credit exposures is estimated by loan segment at each balance sheet date under the current expected credit loss model using the 37 same methodologies as portfolio loans, taking into consideration the likelihood that funding will occur as well as any third-party guarantees.
The allowance for unfunded commitments on off-balance sheet credit exposures is estimated by loan segment at each balance sheet date under the current expected credit loss 41 model using the same methodologies as portfolio loans, taking into consideration the likelihood that funding will occur as well as any third-party guarantees.
Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Since many of the commitment amounts expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. The following table summarizes commitments outstanding at December 31, 2023 and 2022.
Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Since many of the commitment amounts expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. The following table summarizes commitments outstanding at December 31, 2024 and 2023.
The amounts of time certificates of deposit issued in amounts of more than $250,000 as of December 31, 2023, are shown below by category, which is based on time remaining until maturity of (i) three months or less, (ii) over three through six months, (iii) over six months through one year and (iv) over one year.
The amounts of time certificates of deposit issued in amounts of more than $250,000 as of December 31, 2024, are shown below by category, which is based on time remaining until maturity of (i) three months or less, (ii) over three through six months, (iii) over six months through one year and (iv) over one year.
Our Bank has also granted commitments to approved customers for financial standby letters of credit. These commitments are recorded in the financial 49 statements when funds are disbursed or the financial instruments become payable. The Bank uses the same credit policies for these off-balance-sheet commitments as it does for financial instruments that are recorded in the consolidated financial statements.
Our Bank has also granted commitments to approved customers for financial standby letters of credit. These commitments are recorded in the financial statements when funds are disbursed or the financial instruments become payable. The Bank uses the same credit policies for 53 these off-balance-sheet commitments as it does for financial instruments that are recorded in the consolidated financial statements.
Income Taxes As required by GAAP, we use the asset and liability method of accounting for deferred income taxes and provide deferred income taxes for all significant income tax temporary differences. See Note 12, “Income Taxes,” in the notes to consolidated financial statements for additional details.
Income Taxes As required by GAAP, we use the asset and liability method of accounting for deferred income taxes and provide deferred income taxes for all significant income tax temporary differences. See Note 11, “Income Taxes,” in the notes to consolidated financial statements for additional details.
The increase in the allowance for credit losses on loans as a percentage of loans compared with December 31, 2022 was primarily attributable to declines in forecast economic conditions, particularly levels of commercial real estate prices, compared with 2022.
The increase in the allowance for credit losses on loans as a percentage of loans compared with December 31, 2023 was primarily attributable to declines in forecast economic conditions, particularly levels of commercial real estate prices, compared with 2023.
As a result, the Company and Bank elected the five-year transition relief allowed under the interim final rule effective March 31, 2020. The following table summarizes the regulatory capital levels of Ameris at December 31, 2023.
As a result, the Company and Bank elected the five-year transition relief allowed under the interim final rule effective March 31, 2020. The following table summarizes the regulatory capital levels of Ameris at December 31, 2024.
For both 2023 and 2022, other capital related transactions, such as share-based compensation, common stock issuances through the exercise of stock options, and issuances of shares of restricted stock accounted for only a small change in the capital of the Company.
For both 2024 and 2023, other capital related transactions, such as share-based compensation, common stock issuances through the exercise of stock options, and issuances of shares of restricted stock accounted for only a small change in the capital of the Company.
The Company regularly monitors its largest loan relationships to avoid a concentration with a single borrower. The largest 25 loan relationships as of December 31, 2023 based on committed amount are summarized below by type.
The Company regularly monitors its largest loan relationships to avoid a concentration with a single borrower. The largest 25 loan relationships as of December 31, 2024 based on committed amount are summarized below by type.
The following table sets forth the distribution of the repricing of our interest-earning assets and interest-bearing liabilities as of December 31, 2023, the interest rate sensitivity gap (i.e., interest rate sensitive assets minus interest rate sensitive liabilities), the cumulative interest rate sensitivity gap, the interest rate sensitivity gap ratio (i.e., interest rate sensitive assets divided by interest rate sensitive liabilities) and the cumulative interest rate sensitivity gap ratio.
The following table sets forth the distribution of the repricing of our interest-earning assets and interest-bearing liabilities as of December 31, 2024, the interest rate sensitivity gap (i.e., interest rate sensitive assets minus interest rate sensitive liabilities), the cumulative interest rate sensitivity gap, the interest rate sensitivity gap ratio (i.e., interest rate sensitive assets divided by interest rate sensitive liabilities) and the cumulative interest rate sensitivity gap ratio.
Reported net income for the year ended December 31, 2023 includes $142.7 million in provision for credit losses, primarily related to updated economic forecasts and organic growth, partially offset by a reduction in unfunded commitments and the related allowance, compared with a provision of $71.7 million in 2022 resulting from organic growth in loans and the updated economic forecast.
Reported net income for the year ended December 31, 2024 includes $58.8 million in provision for credit losses, primarily related to updated economic forecasts and organic growth, partially offset by a reduction in unfunded commitments and the related allowance, compared with a provision of $142.7 million in 2023 resulting from organic growth in loans and the updated economic forecast.
Except for its effect on the general level of interest rates, inflation does not have a material impact on the balance sheet due to the rate variability and short-term maturities of its earning assets. In particular, approximately 38.4% of earning assets mature or reprice within one year or less.
Except for its effect on the general level of interest rates, inflation does not have a material impact on the balance sheet due to the rate variability and short-term maturities of its earning assets. In particular, approximately 49 43.0% of earning assets mature or reprice within one year or less.
The Company does not intend to sell these investment securities at an unrealized loss position at December 31, 2023, and it is more 48 likely than not that the Company will not be required to sell these securities prior to recovery or maturity.
The Company does not intend to sell these investment securities at an unrealized loss position at December 31, 2024, and it is more 52 likely than not that the Company will not be required to sell these securities prior to recovery or maturity.
The following table sets forth certain information about contractual cash obligations as of December 31, 2023.
The following table sets forth certain information about contractual cash obligations as of December 31, 2024.
For the year ended December 31, 2023, the Company recorded income tax expense of approximately $87.8 million, compared with $106.6 million recorded in 2022 and $119.2 million recorded in 2021. The Company’s effective tax rate was 24.6%, 23.5% and 24.0% for the years ended December 31, 2023, 2022 and 2021, respectively.
For the year ended December 31, 2024, the Company recorded income tax expense of approximately $117.2 million, compared with $87.8 million recorded in 2023 and $106.6 million recorded in 2022. The Company’s effective tax rate was 24.6%, 24.6% and 23.5% for the years ended December 31, 2024, 2023 and 2022, respectively.
EARNING ASSETS AND LIABILITIES Average earning assets were approximately $23.26 billion in 2023, compared with approximately $21.41 billion in 2022. The earning asset and interest-bearing liability mix is regularly monitored to maximize the net interest margin and, therefore, increase return on assets and shareholders’ equity.
EARNING ASSETS AND LIABILITIES Average earning assets were approximately $23.97 billion in 2024, compared with approximately $23.26 billion in 2023. The earning asset and interest-bearing liability mix is regularly monitored to maximize the net interest margin and, therefore, increase return on assets and shareholders’ equity.
Year Ended December 31, 2023 2022 2021 (dollars in thousands) Average Balance Average Rate Average Balance Average Rate Average Balance Average Rate Federal funds purchased and securities sold under agreement to repurchase $ — — % $ 1,477 0.27 % $ 6,700 0.30 % Year Ended December 31, 2023 2022 2021 (dollars in thousands) Total Balance Total Balance Total Balance Total maximum short-term borrowings outstanding at any month-end during the year $ — $ 6,924 $ 9,320 As of December 31, 2023, letters of credit issued by the Federal Home Loan Bank totaling $950.0 million were used to guarantee the Bank’s performance related to a portion of its public fund deposit balances.
Year Ended December 31, 2024 2023 2022 (dollars in thousands) Average Balance Average Rate Average Balance Average Rate Average Balance Average Rate Federal funds purchased and securities sold under agreement to repurchase $ — — % $ — — % $ 1,477 0.27 % Year Ended December 31, 2024 2023 2022 (dollars in thousands) Total Balance Total Balance Total Balance Total maximum short-term borrowings outstanding at any month-end during the year $ — $ — $ 6,924 As of December 31, 2024, letters of credit issued by the Federal Home Loan Bank totaling $1.33 billion were used to guarantee the Bank’s performance related to a portion of its public fund deposit balances.
Noninterest Income Following is a comparison of noninterest income for 2023, 2022 and 2021.
Noninterest Income Following is a comparison of noninterest income for 2024, 2023 and 2022.
Yield on average earning assets on a taxable equivalent basis increased during 2022 to 4.19%, compared with 3.56% for the year ended December 31, 2021. Average yields on all interest-earning asset categories increased from 2021 to 2022 as market interest rates increased.
Yield on average earning assets on a taxable equivalent basis increased during 2023 to 5.52%, compared with 4.19% for the year ended December 31, 2022. Average yields on all interest-earning asset categories increased from 2022 to 2023 as market interest rates increased.
For the fourth quarter of 2023, the Company recorded net income of $65.9 million, or $0.96 per diluted share, compared with $82.2 million, or $1.18 per diluted share, for the quarter ended December 31, 2022, and $81.9 million, or $1.18 per diluted share, for the quarter ended December 31, 2021.
For the fourth quarter of 2024, the Company recorded net income of $94.4 million, or $1.37 per diluted share, compared with $65.9 million, or $0.96 per diluted share, for the quarter ended December 31, 2023, and $82.2 million, or $1.18 per diluted share, for the quarter ended December 31, 2022.
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS OVERVIEW During 2023, the Company reported net income of $269.1 million, or $3.89 per diluted share, compared with $346.5 million, or $4.99 per diluted share, in 2022.
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS OVERVIEW During 2024, the Company reported net income of $358.7 million, or $5.19 per diluted share, compared with $269.1 million, or $3.89 per diluted share, in 2023.
Costs of interest-bearing deposits increased during 2023 to 2.69%, compared with 0.49% for 2022. This increase reflects a shift in mix of deposits based on customer behavior and increased competition in the market for deposits. The cost of non-deposit funding increased to 5.37% in 2023, compared with 4.59% resulting from an increase in market interest rates.
This increase reflects a shift in mix of deposits based on customer behavior and increased competition in the market for deposits. The cost of non-deposit funding increased to 5.37% in 2023, compared with 4.59% resulting from an increase in market interest rates.
Included in non-performing assets were serviced GNMA-guaranteed residential mortgage loans totaling $90.2 million and $69.6 million at December 31, 2023 and 2022, respectively. Non-performing assets, excluding GNMA-guaranteed loans, represented 0.33% of total assets at December 31, 2023, compared with 0.34% of total assets at December 31, 2022.
Included in non-performing assets were serviced GNMA-guaranteed residential mortgage loans totaling $12.0 million and $90.2 million at December 31, 2024 and 2023, respectively. Non-performing assets, excluding GNMA-guaranteed loans, represented 0.42% of total assets at December 31, 2024, compared with 0.33% of total assets at December 31, 2023.
Based on the results of management's review, at December 31, 2023, management determined $69,000 was attributable to credit impairment and decreased the allowance for credit losses accordingly. The remaining $44.7 million in unrealized loss was determined to be from factors other than credit.
Based on the results of management's review, at December 31, 2024, management determined $69,000 was attributable to credit impairment and maintained the allowance for credit losses accordingly. The remaining $39.0 million in unrealized loss was determined to be from factors other than credit.
These estimates were derived using the same methodologies and assumptions used for the Bank's regulatory reporting. Approximately $2.64 billion, or 29.0%, of the uninsured deposits at December 31, 2023 were for municipalities which are collateralized with investment securities or letters of credit.
These estimates were derived using the same methodologies and assumptions used for the Bank's regulatory reporting. Approximately $3.49 billion, or 34.0%, of the uninsured deposits at December 31, 2024 were for municipalities which are collateralized with investment securities or letters of credit.
As of December 31, 2023, approximately 74.2% of our loan portfolio was secured by real estate, compared with 71.1% at December 31, 2022. 40 The amount of loans outstanding at the indicated dates is shown in the following table according to type of loans.
As of December 31, 2024, approximately 72.3% of our loan portfolio was secured by real estate, compared with 74.2% at December 31, 2023. 44 The amount of loans outstanding at the indicated dates is shown in the following table according to type of loans.
The Company’s net interest margin, on a tax equivalent basis, decreased 15 basis points to 3.61% for the year ended December 31, 2023, compared with 3.76% for the year ended December 31, 2022. 2022 compared with 2021.
The Company’s net interest margin, on a tax equivalent basis, decreased five basis points to 3.56% for the year ended December 31, 2024, compared with 3.61% for the year ended December 31, 2023. 2023 compared with 2022.
Excluding those charge-offs, the net charge-off rate for 2023 would have been 0.22%. At December 31, 2023, non-performing assets amounted to $174.3 million, or 0.69% of total assets, compared with $153.5 million, or 0.61% of total assets, at December 31, 2022.
Excluding those charge-offs, the net charge-off rate for 2023 would have been 0.22%. At December 31, 2024, non-performing assets amounted to $122.4 million, or 0.47% of total assets, compared with $174.3 million, or 0.69% of total assets, at December 31, 2023.
Noninterest-bearing deposits (or demand deposits) are transaction accounts that provide us with “interest-free” sources of funds. Interest-bearing deposits include NOW, money market, savings and time deposits. During 2023, total deposits increased $1.25 billion, or 6.4%, to $20.71 billion at December 31, 2023, compared with $19.46 billion at December 31, 2022.
Noninterest-bearing deposits (or demand deposits) are transaction accounts that provide us with “interest-free” sources of funds. Interest-bearing deposits include NOW, money market, savings and time deposits. During 2024, total deposits increased $1.01 billion, or 4.9%, to $21.72 billion at December 31, 2024, compared with $20.71 billion at December 31, 2023.
Other real estate was approximately $6.2 million as of December 31, 2023, compared with $843,000 at December 31, 2022. The Company’s allowance for credit losses on loans at December 31, 2023 was $307.1 million, or 1.52% of loans compared with $205.7 million, or 1.04%, and $167.6 million, or 1.06%, at December 31, 2022 and 2021, respectively.
Other real estate was approximately $2.4 million as of December 31, 2024, compared with $6.2 million at December 31, 2023. The Company’s allowance for credit losses on loans at December 31, 2024 was $338.1 million, or 1.63% of loans compared with $307.1 million, or 1.52%, and $205.7 million, or 1.04%, at December 31, 2023 and 2022, respectively.
The Company's provision for unfunded commitments during 2023 amounted to a release of $10.9 million, compared with a provision of $19.2 million for 2022 and $332,000 for 2021.
The Company's provision for unfunded commitments during 2024 amounted to a release of $11.0 million, compared with a release of $10.9 million for 2023 and a provision of $19.2 million for 2022.
Such agencies may require the Company to recognize additions to the ACL based on their judgments about information available to them at the time of their examination. As discussed in Note 4 to the consolidated financial statements, Management determined the ACL on loans at December 31, 2023 utilizing the Moody's baseline economic forecast.
Such agencies may require the Company to recognize additions to the ACL based on their judgments about information available to them at the time of their examination. As discussed in Note 3 to the consolidated financial statements, Management determined the ACL on loans at December 31, 2024 utilizing a weighting of two economic forecasts from Moody's.
The decrease in the provision for unfunded commitments was primarily due to a reduction in unfunded commitments during 2023 resulting from a decrease in loan production and funding or completion of existing commitments. The Company recorded a release of provision for other credit losses during 2023 totaling $6,000, compared with releases of $139,000 for 2022 and $616,000 for 2021.
The decrease in the provision for unfunded commitments was primarily due to a reduction in unfunded commitments during 2024 resulting from completion of existing commitments. The Company recorded no provision for other credit losses during 2024, compared with releases of $6,000 for 2023 and $139,000 for 2022.
NET INCOME AND EARNINGS PER SHARE The Company’s net income during 2023 was $269.1 million, or $3.89 per diluted share, compared with $346.5 million, or $4.99 per diluted share, in 2022, and $376.9 million, or $5.40 per diluted share, in 2021.
NET INCOME AND EARNINGS PER SHARE The Company’s net income during 2024 was $358.7 million, or $5.19 per diluted share, compared with $269.1 million, or $3.89 per diluted share, in 2023, and $346.5 million, or $4.99 per diluted share, in 2022.
Our interest-bearing liabilities include deposits, securities sold under agreements to repurchase, other borrowings and subordinated deferrable interest debentures. 2023 compared with 2022. For the year ended December 31, 2023, interest income was $1.28 billion, an increase of $386.5 million, or 43.2%, compared with the same period in 2022.
Our interest-bearing liabilities include deposits, securities sold under agreements to repurchase, other borrowings and subordinated deferrable interest debentures. 2024 compared with 2023. For the year ended December 31, 2024, interest income was $1.38 billion, an increase of $97.8 million, or 7.6%, compared with the same period in 2023.
The increased provision for 2023 was primarily attributable to the updated economic forecast, particularly levels of commercial real estate prices. Net charge-offs in 2023 were 0.25% of average loans, compared with 0.08% in 2022 and 0.04% in 2021. Included in charge-offs for 2023 were $5.6 million in charge-offs on acquired loans which were fully reserved at acquisition.
The decreased provision for 2024 was primarily attributable to the updated economic forecast. Net charge-offs in 2024 were 0.19% of average loans, compared with 0.25% in 2023 and 0.08% in 2022. Included in charge-offs for 2023 were $5.6 million in charge-offs on acquired loans which were fully reserved at acquisition.
Other noninterest expense decreased $2.4 million, or 5.4%, to $43.1 million in 2023 from $45.5 million in 2022, resulting primarily from an increase in deferred costs related to our equipment finance division production and net gains on sale of bank premises.
Other noninterest expense decreased $2.7 million, or 5.8%, to $43.3 million in 2023 from $46.0 million in 2022, resulting primarily from an increase in deferred costs related to our equipment finance division production and net gains on sale of bank premises and a decrease in tax and license expense.
Included in FDIC insurance for 2023 was $11.6 million related to the FDIC special assessment pursuant to the systemic risk determination following the closures of Silicon Valley Bank and Signature Bank in March 2023.
Included in FDIC insurance for 2023 was $11.6 million related to the FDIC special assessment pursuant to the systemic risk determination following the closures of Silicon Valley Bank and Signature Bank in March 2023. Also contributing to the increase in 2023 was an increase in the base assessment rates which took effect during 2023.
December 31, (dollars in thousands) 2023 2022 2021 Allowance for credit losses on loans at end of period $ 307,100 $ 205,677 $ 167,582 Loan balances: End of period 20,269,303 19,855,253 15,874,258 Allowance for credit losses on loans as a percentage of end of period loans 1.52 % 1.04 % 1.06 % Nonaccrual loans as a percentage of end of period loans 0.75 % 0.68 % 0.54 % Allowance for credit losses to nonaccrual loans at end of period 203.22 % 152.57 % 196.54 % At December 31, 2023, the allowance for credit losses on loans totaled $307.1 million, or 1.52% of loans, compared with $205.7 million, or 1.04% of loans, at December 31, 2022.
December 31, (dollars in thousands) 2024 2023 2022 Allowance for credit losses on loans at end of period $ 338,084 $ 307,100 $ 205,677 Loan balances: End of period 20,739,906 20,269,303 19,855,253 Allowance for credit losses on loans as a percentage of end of period loans 1.63 % 1.52 % 1.04 % Nonaccrual loans as a percentage of end of period loans 0.49 % 0.75 % 0.68 % Allowance for credit losses to nonaccrual loans at end of period 330.75 % 203.22 % 152.57 % At December 31, 2024, the allowance for credit losses on loans totaled $338.1 million, or 1.63% of loans, compared with $307.1 million, or 1.52% of loans, at December 31, 2023.
The Company’s net income as a percentage of average assets for 2023 and 2022 was 1.06% and 1.47%, respectively, while the Company’s net income as a percentage of average shareholders’ equity was 8.12% and 11.24%, respectively.
The Company’s net income as a percentage of average assets for 2024 and 2023 was 1.38% and 1.06%, respectively, while the Company’s net income as a percentage of average shareholders’ equity was 10.01% and 8.12%, respectively.
When repayment is expected to be from the operation of the collateral, expected credit losses are calculated as the amount by which the amortized cost basis of the loan exceeds the present value of expected cash flows from the operation of the collateral.
Loans which do not share common risk characteristics are evaluated on an individual basis. When repayment is 37 expected to be from the operation of the collateral, expected credit losses are calculated as the amount by which the amortized cost basis of the loan exceeds the present value of expected cash flows from the operation of the collateral.
Average yields on all interest-earning asset categories increased from 2022 to 2023 as market interest rates increased. Interest expense for the year ended December 31, 2023 was $445.4 million, an increase of $352.5 million, or 379.6%, compared with $92.9 million for the year ended December 31, 2022.
Average yields on all interest-earning asset categories increased from 2023 to 2024 as market interest rates increased. Interest expense for the year ended December 31, 2024 was $529.1 million, an increase of $83.7 million, or 18.8%, compared with $445.4 million for the year ended December 31, 2023.
It is possible that others, given the same information, may at any point in time reach a different reasonable conclusion. 32 Loans which share common risk characteristics are pooled for the purposes of determining the ACL.
It is possible that others, given the same information, may at any point in time reach a different reasonable conclusion. Loans which share common risk characteristics are pooled for the purposes of determining the ACL. Management uses the discounted cash flow method or the PD×LGD method, which may be adjusted for qualitative factors, in measuring the ACL for pooled loans.
Treasuries $ 720,877 $ 759,534 U.S. government-sponsored agencies 985 979 State, county and municipal securities 28,051 34,195 Corporate debt securities 10,027 15,926 SBA pool securities 51,516 27,398 Mortgage-backed securities 591,488 662,028 Total debt securities available-for-sale $ 1,402,944 $ 1,500,060 Following is a summary of the carrying value of debt securities held-to-maturity as of the end of each reported period: December 31, (dollars in thousands) 2023 2022 State, county and municipal securities $ 31,905 $ 31,905 Mortgage-backed securities 109,607 102,959 Total debt securities held-to-maturity $ 141,512 $ 134,864 47 The amounts of securities available-for-sale and held-to in each category as of December 31, 2023 are shown in the following table according to contractual maturity classifications: (i) one year or less, (ii) after one year through five years, (iii) after five years through ten years and (iv) after ten years.
Treasuries $ 796,464 $ 720,877 U.S. government-sponsored agencies 994 985 State, county and municipal securities 24,740 28,051 Corporate debt securities 10,283 10,027 SBA pool securities 70,482 51,516 Mortgage-backed securities 768,297 591,488 Total debt securities available-for-sale $ 1,671,260 $ 1,402,944 Following is a summary of the carrying value of debt securities held-to-maturity as of the end of each reported period: December 31, (dollars in thousands) 2024 2023 State, county and municipal securities $ 33,623 $ 31,905 Mortgage-backed securities 131,054 109,607 Total debt securities held-to-maturity $ 164,677 $ 141,512 51 The amounts of securities available-for-sale and held-to in each category as of December 31, 2024 are shown in the following table according to contractual maturity classifications: (i) one year or less, (ii) after one year through five years, (iii) after five years through ten years and (iv) after ten years.
NONPERFORMING LOANS A loan is placed on nonaccrual status when, in management’s judgment, the collection of the interest income appears doubtful. Interest receivable that has been accrued and is subsequently determined to have doubtful collectability is reversed against interest income. Interest on loans that are classified as nonaccrual is recognized when received.
Interest receivable that has been accrued and is subsequently determined to have doubtful collectability is reversed against interest income. Interest on loans that are classified as nonaccrual is recognized when received.
In the event of a change in interest rates, prepayment and early withdrawal levels also could deviate significantly from those assumed in calculating the interest rate gap.
In the event of a change in interest rates, prepayment and early withdrawal levels also could deviate significantly from those assumed in calculating the interest rate gap. The ability of many borrowers to service their debts also may decrease in the event of an interest rate increase.
Year Ended December 31, 2023 2022 2021 (dollars in thousands) Average Balance Interest Income/ Expense Average Yield/ Rate Paid Average Balance Interest Income/ Expense Average Yield/ Rate Paid Average Balance Interest Income/ Expense Average Yield/ Rate Paid Assets Interest-earning assets: Interest-bearing deposits in banks $ 914,818 $ 47,936 5.24 % $ 1,993,672 $ 23,008 1.15 % $ 2,857,141 $ 3,880 0.14 % Federal funds sold — — — 10,836 77 0.71 20,000 42 0.21 Time deposits in other banks — — — — — — 122 2 1.64 Investment securities - taxable 1,664,184 59,002 3.55 1,123,681 34,656 3.08 822,408 22,524 2.74 Investment securities - nontaxable 41,679 1,690 4.05 39,779 1,489 3.74 19,793 728 3.68 Loans held for sale 484,070 29,711 6.14 718,599 29,699 4.13 1,463,614 42,651 2.91 Loans 20,154,321 1,145,876 5.69 17,521,461 808,826 4.62 14,703,956 637,861 4.34 Total interest-earning assets 23,259,072 1,284,215 5.52 21,408,028 897,755 4.19 19,887,034 707,688 3.56 Noninterest-earning assets 2,145,801 2,236,726 1,960,697 Total assets $ 25,404,873 $ 23,644,754 $ 21,847,731 Liabilities and Shareholders' Equity Interest-bearing liabilities: Interest-bearing deposits NOW Accounts $ 3,878,034 $ 69,584 1.79 % $ 3,675,586 $ 14,367 0.39 % $ 3,400,441 $ 3,414 0.10 % MMDA 5,382,865 162,718 3.02 5,128,497 33,143 0.65 4,953,748 7,847 0.16 Savings Accounts 936,454 6,349 0.68 1,005,752 1,287 0.13 884,623 503 0.06 Retail CDs 2,031,828 63,650 3.13 1,604,978 7,308 0.46 1,953,927 10,575 0.54 Brokered CDs 1,024,606 53,716 5.24 — — — 625 18 2.88 Total Interest-Bearing Deposits 13,253,787 356,017 2.69 11,414,813 56,105 0.49 11,193,364 22,357 0.20 Non-deposit funding Federal funds purchased and securities sold under agreements to repurchase — — — 1,477 4 0.27 6,700 20 0.30 FHLB advances 1,210,242 59,302 4.90 279,409 9,710 3.48 48,888 775 1.59 Other borrowings 325,260 16,870 5.19 393,393 19,209 4.88 399,485 19,278 4.83 Subordinated deferrable interest debentures 129,310 13,202 10.21 127,316 7,832 6.15 125,324 5,355 4.27 Total non-deposit funding 1,664,812 89,374 5.37 801,595 36,755 4.59 580,397 25,428 4.38 Total interest-bearing liabilities 14,918,599 445,391 2.99 12,216,408 92,860 0.76 11,773,761 47,785 0.41 Noninterest-bearing demand deposits 6,771,464 8,005,201 7,017,614 Other liabilities 401,449 340,064 228,687 Shareholders' equity 3,313,361 3,083,081 2,827,669 Total liabilities and shareholders’ equity $ 25,404,873 $ 23,644,754 $ 21,847,731 Interest rate spread 2.53 % 3.43 % 3.15 % Net interest income $ 838,824 $ 804,895 $ 659,903 Net interest margin 3.61 % 3.76 % 3.32 % 35 RESULTS OF OPERATIONS Net Interest Income Net interest income represents the amount by which interest income on interest-earning assets exceeds interest expense incurred on interest-bearing liabilities.
Year Ended December 31, 2024 2023 2022 (dollars in thousands) Average Balance Interest Income/ Expense Average Yield/ Rate Paid Average Balance Interest Income/ Expense Average Yield/ Rate Paid Average Balance Interest Income/ Expense Average Yield/ Rate Paid Assets Interest-earning assets: Interest-bearing deposits in banks $ 930,145 $ 49,906 5.37 % $ 914,818 $ 47,936 5.24 % $ 1,993,672 $ 23,008 1.15 % Federal funds sold — — — — — — 10,836 77 0.71 Investment securities - taxable 1,690,053 61,518 3.64 1,664,184 59,002 3.55 1,123,681 34,656 3.08 Investment securities - nontaxable 41,419 1,694 4.09 41,679 1,690 4.05 39,779 1,489 3.74 Loans held for sale 547,190 34,532 6.31 484,070 29,711 6.14 718,599 29,699 4.13 Loans 20,759,247 1,234,464 5.95 20,154,321 1,145,876 5.69 17,521,461 808,826 4.62 Total interest-earning assets 23,968,054 1,382,114 5.77 23,259,072 1,284,215 5.52 21,408,028 897,755 4.19 Noninterest-earning assets 2,068,627 2,145,801 2,236,726 Total assets $ 26,036,681 $ 25,404,873 $ 23,644,754 Liabilities and Shareholders' Equity Interest-bearing liabilities: Interest-bearing deposits NOW Accounts $ 3,824,094 $ 81,228 2.12 % $ 3,878,034 $ 69,584 1.79 % $ 3,675,586 $ 14,367 0.39 % MMDA 6,395,883 231,065 3.61 5,382,865 162,718 3.02 5,128,497 33,143 0.65 Savings Accounts 776,273 3,780 0.49 936,454 6,349 0.68 1,005,752 1,287 0.13 Retail CDs 2,440,891 102,672 4.21 2,031,828 63,650 3.13 1,604,978 7,308 0.46 Brokered CDs 1,274,933 65,928 5.17 1,024,606 53,716 5.24 — — — Total Interest-Bearing Deposits 14,712,074 484,673 3.29 13,253,787 356,017 2.69 11,414,813 56,105 0.49 Non-deposit funding Federal funds purchased and securities sold under agreements to repurchase — — — — — — 1,477 4 0.27 FHLB advances 335,056 16,581 4.95 1,210,242 59,302 4.90 279,409 9,710 3.48 Other borrowings 298,372 14,313 4.80 325,260 16,870 5.19 393,393 19,209 4.88 Subordinated deferrable interest debentures 131,302 13,527 10.30 129,310 13,202 10.21 127,316 7,832 6.15 Total non-deposit funding 764,730 44,421 5.81 1,664,812 89,374 5.37 801,595 36,755 4.59 Total interest-bearing liabilities 15,476,804 529,094 3.42 14,918,599 445,391 2.99 12,216,408 92,860 0.76 Noninterest-bearing demand deposits 6,567,855 6,771,464 8,005,201 Other liabilities 408,632 401,449 340,064 Shareholders' equity 3,583,390 3,313,361 3,083,081 Total liabilities and shareholders’ equity $ 26,036,681 $ 25,404,873 $ 23,644,754 Interest rate spread 2.35 % 2.53 % 3.43 % Net interest income $ 853,020 $ 838,824 $ 804,895 Net interest margin 3.56 % 3.61 % 3.76 % 39 RESULTS OF OPERATIONS Net Interest Income Net interest income represents the amount by which interest income on interest-earning assets exceeds interest expense incurred on interest-bearing liabilities.
Years Ended December 31, (dollars in thousands) 2023 2022 2021 Salaries and employee benefits $ 320,110 $ 319,719 $ 337,776 Occupancy and equipment 51,450 51,361 48,066 Advertising and marketing 11,856 12,481 8,434 Amortization of intangible assets 18,244 19,744 14,965 Data processing and communications expenses 53,486 49,228 45,976 Legal and other professional fees 17,726 16,439 11,920 Credit resolution-related expenses 80 29 3,538 Merger and conversion charges — 1,212 4,206 FDIC insurance 26,940 8,063 5,614 Loan servicing expenses 35,283 36,835 26,481 Other noninterest expenses 43,106 45,544 53,148 $ 578,281 $ 560,655 $ 560,124 2023 compared with 2022.
Years Ended December 31, (dollars in thousands) 2024 2023 2022 Salaries and employee benefits $ 347,641 $ 320,110 $ 319,719 Occupancy and equipment 48,784 51,450 51,361 Advertising and marketing 12,612 11,638 12,032 Amortization of intangible assets 17,189 18,244 19,744 Data processing and communications expenses 59,699 53,486 49,228 Legal and other professional fees 16,737 17,726 16,439 Credit resolution-related expenses 2,487 80 29 Merger and conversion charges — — 1,212 FDIC insurance 15,499 26,940 8,063 Loan servicing expenses 36,157 35,283 36,835 Other noninterest expenses 50,989 43,324 45,993 Total noninterest expense $ 607,794 $ 578,281 $ 560,655 2024 compared with 2023.
The ability of many borrowers to service their debts also may decrease in the event of an interest rate increase. 45 We manage the mix of asset and liability maturities in an effort to control the effects of changes in the general level of interest rates on net interest income.
We manage the mix of asset and liability maturities in an effort to control the effects of changes in the general level of interest rates on net interest income.
During 2023 average interest-bearing liabilities were $14.92 billion as compared with $12.22 billion for 2022, an increase of $2.70 billion, or 22.1%. During 2023, average noninterest-bearing deposit accounts were $6.77 billion and comprised 33.8% of average total deposits, compared with $8.01 billion, or 41.2% of average total deposits, during 2022.
During 2024 average interest-bearing liabilities were $15.48 billion as compared with $14.92 billion for 2023, an increase of $558.2 million, or 3.7%. During 2024, average noninterest-bearing deposit accounts were $6.57 billion and comprised 30.9% of average total deposits, compared with $6.77 billion, or 33.8% of average total deposits, during 2023.
For the year ended December 31, 2022, interest income was $893.9 million, an increase of $190.8 million, or 27.1%, compared with the same period in 2021. Average earning assets increased $1.52 billion, or 7.6%, to $21.41 billion for the year ended December 31, 2022, compared with $19.89 billion for 2021.
For the year ended December 31, 2023, interest income was $1.28 billion, an increase of $386.5 million, or 43.2%, compared with the same period in 2022. Average earning assets increased $1.85 billion, or 8.6%, to $23.26 billion for the year ended December 31, 2023, compared with $21.41 billion for 2022.
December 31, (dollars in thousands) 2023 2022 Commitments to extend credit $ 4,412,818 $ 6,318,039 Unused lines of credit 386,574 345,001 Financial standby letters of credit 37,546 33,557 Mortgage interest rate lock commitments 171,750 148,148 Mortgage forward contracts with positive fair value - notional amount — 689,500 Mortgage forward contracts with negative fair value - notional amount 663,015 — $ 5,671,703 $ 7,534,245 The following table summarizes short-term borrowings for the periods indicated.
December 31, (dollars in thousands) 2024 2023 Commitments to extend credit $ 3,578,227 $ 4,412,818 Unused home equity lines of credit 437,304 386,574 Financial standby letters of credit 39,507 37,546 Mortgage interest rate lock commitments 192,528 171,750 Mortgage forward contracts with positive fair value - notional amount 1,153,717 — Mortgage forward contracts with negative fair value - notional amount — 663,015 $ 5,401,283 $ 5,671,703 The following table summarizes short-term borrowings for the periods indicated.
Average earning assets increased $1.85 billion, or 8.6%, to $23.26 billion for the year ended December 31, 2023, compared with $21.41 billion for 2022. Yield on average earning assets on a taxable equivalent basis increased during 2023 to 5.52%, compared with 4.19% for the year ended December 31, 2022.
Average earning assets increased $709.0 million, or 3.0%, to $23.97 billion for the year ended December 31, 2024, compared with $23.26 billion for 2023. Yield on average earning assets on a taxable-equivalent basis increased during 2024 to 5.77%, compared with 5.52% for the year ended December 31, 2023.
Interest expense for the year ended December 31, 2022 was $92.9 million, an increase of $45.1 million, or 94.3%, compared with $47.8 million for the year ended December 31, 2021. During 2022 average interest-bearing liabilities were $12.22 billion as compared with $11.77 billion for 2021, an increase of $442.6 million, or 3.8%.
Interest expense for the year ended December 31, 2023 was $445.4 million, an increase of $352.5 million, or 379.6%, compared with $92.9 million for the year ended December 31, 2022. During 2023 average interest-bearing liabilities were $14.92 billion as compared with $12.22 billion for 2022, an increase of $2.70 billion, or 22.1%.
Non-performing Portfolio Assets Reconciliation Year Ended December 31, (dollars in thousands) 2023 2022 Nonaccrual portfolio loans $ 60,961 $ 65,221 Other real estate owned 6,199 843 Repossessed assets 17 28 Accruing loans delinquent 90 days or more 16,988 17,865 Non-performing portfolio assets $ 84,165 $ 83,957 Serviced GNMA-guaranteed mortgage nonaccrual loans 90,156 69,587 Total non-performing assets $ 174,321 $ 153,544 Total assets 25,203,699 25,053,286 Non-performing portfolio assets as a percent of total assets 0.33 % 0.34 % Total non-performing assets as a percent of total assets 0.69 % 0.61 % 31 Adjusted Efficiency Ratio Reconciliation Year Ended December 31, (dollars in thousands except per share data) 2023 2022 Adjusted Noninterest Expense Total noninterest expense $ 578,281 $ 560,655 Adjustment items: Merger and conversion charges — (1,212) FDIC special assessment (11,566) — Natural disaster expenses — (151) Gain on sale of premises 1,903 45 Adjusted noninterest expense $ 568,618 $ 559,337 Total Revenue Net interest income $ 835,044 $ 801,026 Noninterest income 242,828 284,424 Total revenue $ 1,077,872 $ 1,085,450 Adjusted Total Revenue Net interest income (TE) $ 838,824 $ 804,895 Noninterest income 242,828 284,424 Total revenue (TE) 1,081,652 1,089,319 Adjustment items: (Gain) loss on securities 304 (203) Gain on sale of mortgage servicing rights — (1,356) Gain on BOLI proceeds (486) (55) Servicing right impairment (recovery) — (21,824) Adjusted total revenue (TE) $ 1,081,470 $ 1,065,881 Efficiency ratio 53.65 % 51.65 % Adjusted efficiency ratio (TE) 52.58 % 52.48 % CRITICAL ACCOUNTING POLICIES AND ESTIMATES Ameris has established certain accounting and financial reporting policies to govern the application of accounting principles generally accepted in the United States of America (“GAAP”) in the preparation of its financial statements.
Non-performing Portfolio Assets Reconciliation Year Ended December 31, (dollars in thousands) 2024 2023 Nonaccrual portfolio loans $ 90,206 $ 60,961 Other real estate owned 2,433 6,199 Repossessed assets 9 17 Accruing loans delinquent 90 days or more 17,733 16,988 Non-performing portfolio assets $ 110,381 $ 84,165 Serviced GNMA-guaranteed mortgage nonaccrual loans 12,012 90,156 Total non-performing assets $ 122,393 $ 174,321 Total assets 26,262,050 25,203,699 Non-performing portfolio assets as a percent of total assets 0.42 % 0.33 % Total non-performing assets as a percent of total assets 0.47 % 0.69 % 36 Adjusted Efficiency Ratio Reconciliation Year Ended December 31, (dollars in thousands except per share data) 2024 2023 Adjusted Noninterest Expense Total noninterest expense $ 607,794 $ 578,281 Adjustment items: FDIC special assessment (1,455) (11,566) Natural disaster expenses (550) — (Loss) gain on disposition of premises (1,203) 1,903 Adjusted noninterest expense $ 604,586 $ 568,618 Total Revenue Net interest income $ 849,190 $ 835,044 Noninterest income 293,257 242,828 Total revenue $ 1,142,447 $ 1,077,872 Adjusted Total Revenue Net interest income (TE) $ 853,020 $ 838,824 Noninterest income 293,257 242,828 Total revenue (TE) 1,146,277 1,081,652 Adjustment items: (Gain) loss on securities (12,304) 304 Gain on sale of mortgage servicing rights (10,494) — Gain on BOLI proceeds (1,464) (486) Adjusted total revenue (TE) $ 1,122,015 $ 1,081,470 Efficiency ratio 53.20 % 53.65 % Adjusted efficiency ratio (TE) 53.88 % 52.58 % CRITICAL ACCOUNTING POLICIES AND ESTIMATES Ameris has established certain accounting and financial reporting policies to govern the application of accounting principles generally accepted in the United States of America (“GAAP”) in the preparation of its financial statements.
Results by scenario can vary significantly from period to period as both the scenario assumptions and the portfolio composition are changing. If Management utilized the downside 96th percentile S-4 scenario from Moody's holding all other assumptions constant, the quantitative portion of the ACL on loans would have increased approximately $132.3 million.
If Management utilized the downside 96th percentile S-4 scenario from Moody's holding all other assumptions constant, the quantitative portion of the ACL on loans would have increased approximately $111.7 million.
Merger and conversion charges were $1.2 million in 2022, a decrease of $3.0 million, or 71.2%, compared with $4.2 million recorded for 2021. Merger and conversion charges for both periods were primarily related to the acquisition of Balboa.
Merger and conversion charges were $1.2 million in 2022, compared with no such charges recorded for 2023. Merger and conversion charges for 2022 were primarily related to the acquisition of Balboa Capital Corporation in December 2021.
Highlights of the Company’s performance in 2023 include the following: • Growth in tangible book value per share 1 of 12.4%, from $29.92 at the end of 2022 to $33.64 at the end of 2023 • Adjusted efficiency ratio 1 of 52.58%, compared with 52.48% in 2022 • Organic growth in loans of $414.1 million, or 2.1% • Growth in total deposits of $1.25 billion, or 6.4% • Nonperforming portfolio assets, excluding government-guaranteed loans, as a percentage of total assets improved to 0.33% at December 31, 2023, compared with 0.34% at December 31, 2022 • Increase in the allowance for credit losses to 1.52% of loans, from 1.04% at December 31, 2022, due to forecasted economic conditions, particularly related to commercial real estate price levels ______________________________________________________________________________________________________ 1 A reconciliation of non-GAAP financial measures can be found in the following tables. 30 Adjusted Net Income Reconciliation Year Ended December 31, (dollars in thousands except per share data) 2023 2022 Net income available to common shareholders $ 269,105 $ 346,540 Adjustment items: Merger and conversion charges — 1,212 Gain on sale of mortgage servicing rights — (1,356) Servicing right impairment (recovery) — (21,824) FDIC special assessment 11,566 — Natural disaster expenses — 151 Gain on BOLI proceeds (486) (55) Gain on sale of premises (1,903) (45) Tax effect of adjustment items (Note 1) (2,029) 4,792 After-tax adjustment items 7,148 (17,125) Adjusted net income $ 276,253 $ 329,415 Total shareholders' equity $ 3,426,747 $ 3,197,400 Less: Goodwill 1,015,646 1,015,646 Other intangibles, net 87,949 106,194 Total tangible shareholders' equity $ 2,323,152 $ 2,075,560 Period end number of shares 69,053,341 69,369,050 Book value per share $ 49.62 $ 46.09 Tangible book value per share $ 33.64 $ 29.92 Note 1: Tax effect is calculated utilizing a 21% rate for taxable adjustments.
Highlights of the Company’s performance in 2024 include the following: • Growth in tangible book value per share 1 of 14.7%, from $33.64 at the end of 2023 to $38.59 at the end of 2024 • Organic growth in loans of $470.6 million, or 2.32% • Growth in total deposits of $1.01 billion, or 4.90% • Total non-performing assets as a percentage of total assets declined to 0.47% at December 31, 2024, compared with 0.69% at December 31, 2023 • Increase in the allowance for credit losses to 1.63% of loans, from 1.52% at December 31, 2023, due to forecasted economic conditions and organic loan growth ______________________________________________________________________________________________________ 1 A reconciliation of non-GAAP financial measures can be found in the following tables. 35 Adjusted Net Income Reconciliation Year Ended December 31, (dollars in thousands except per share data) 2024 2023 Net income available to common shareholders $ 358,685 $ 269,105 Adjustment items: Gain on sale of mortgage servicing rights (10,494) — Gain on conversion of Visa Class B-1 stock (12,554) — FDIC special assessment 1,455 11,566 Natural disaster expenses 550 — Gain on BOLI proceeds (1,464) (486) Loss (gain) on disposition of premises 1,203 (1,903) Tax effect of adjustment items (Note 1) 4,166 (2,029) After-tax adjustment items (17,138) 7,148 Tax expense attributable to BOLI restructuring 5,093 — Adjusted net income $ 346,640 $ 276,253 Total shareholders' equity $ 3,751,522 $ 3,426,747 Less: Goodwill 1,015,646 1,015,646 Other intangibles, net 70,761 87,949 Total tangible shareholders' equity $ 2,665,115 $ 2,323,152 Period end number of shares 69,068,609 69,053,341 Book value per share $ 54.32 $ 49.62 Tangible book value per share $ 38.59 $ 33.64 Note 1: Tax effect is calculated utilizing a 21% rate for taxable adjustments.
The S-4 scenario is a downside scenario such that there is a 96% probability that the economy will perform better than the forecast and a 4% probability that the economy will perform worse. Goodwill Goodwill represents the excess of cost over the fair value of the net assets purchased in business combinations.
The S-4 scenario is a downside scenario such that there is a 96% probability that the economy will perform better than the forecast and a 4% probability that the economy will perform worse.
Included in non-performing assets were serviced GNMA-guaranteed residential mortgage loans totaling $90.2 million and $69.6 million at December 31, 2023 and 2022, respectively. Non-performing assets, excluding GNMA-guaranteed loans, represented 0.33% of total assets at December 31, 2023, compared with 0.34% of total assets at December 31, 2022.
As of December 31, 2024 our ratio of nonperforming assets to total assets had decreased to 0.47% from 0.69% at December 31, 2023. Included in non-performing assets were serviced GNMA-guaranteed residential mortgage loans totaling $12.0 million and $90.2 million at December 31, 2024 and 2023, respectively.
For the year ended December 31, 2023, our net charge off ratio as a percentage of average loans increased to 0.25%, compared with 0.08% for the year ended December 31, 2022.
For the year ended December 31, 2024, our net charge off ratio as a percentage of average loans decreased to 0.19%, compared with 0.25% for the year ended December 31, 2023. This decrease was primarily a result of decreased charge-offs in our commercial and industrial portfolio.
Excluding those charge-offs, net charge-offs for 2023 would have been 0.22%. The provision for credit losses on loans for the year ended December 31, 2023 was $153.5 million, compared with $52.6 million for the year ended December 31, 2022. This increase primarily resulted from the updated economic forecast and organic loan growth during 2023.
The provision for credit losses on loans for the year ended December 31, 2024 was $69.8 million, compared with $153.5 million for the year ended December 31, 2023. This decrease primarily resulted from the updated economic forecast during 2024, partially offset by organic loan growth during the year.
Also contributing to the decrease was a decrease in variable expenses related to our mortgage production Income Taxes Income tax expense is influenced by statutory federal and state tax rates, the amount of taxable income, the amount of tax-exempt income and the amount of non-deductible expenses.
These items were partially offset by increases in mortgage indemnification expense and credit reporting expenses related to our equipment finance division. Income Taxes Income tax expense is influenced by statutory federal and state tax rates, the amount of taxable income, the amount of tax-exempt income and the amount of non-deductible expenses.
December 31, 2023 2022 2021 (dollars in thousands) Amount % of Loans to Total Loans Amount % of Loans to Total Loans Amount % of Loans to Total Loans Commercial, financial and agricultural $ 64,053 13 % $ 39,455 13 % $ 26,829 12 % Consumer 3,902 1 5,413 2 6,097 1 Indirect automobile 50 — 174 1 476 2 Mortgage warehouse 1,678 4 2,118 5 3,231 5 Municipal 345 2 357 3 401 4 Premium finance 602 5 1,025 5 2,729 5 Real estate – construction and development 61,017 11 32,659 11 22,045 9 Real estate – commercial and farmland 110,097 40 67,433 38 77,831 43 Real estate - residential 65,356 24 57,043 22 27,943 19 Total $ 307,100 100 % $ 205,677 100 % $ 167,582 100 % 43 The following table provides an analysis of the net charge-offs (recoveries) by loan category for the years ended December 31, 2023, 2022 and 2021. 2023 2022 2021 Net charge-offs (recoveries) Average Balance Rate Net charge-offs (recoveries) Average balance Rate Net charge-offs (recoveries) Average balance Rate Commercial, financial and agricultural $ 43,646 $ 2,687,805 1.62 % $ 8,681 $ 2,116,723 0.41 % $ 2,033 $ 1,526,100 0.13 % Consumer 4,474 308,457 1.45 4,044 214,162 1.89 5,309 235,056 2.26 Indirect automobile (621) 67,326 (0.92) (780) 178,305 (0.44) (491) 404,461 (0.12) Mortgage warehouse — 963,035 — — 891,285 — — 827,159 — Municipal — 502,849 — — 531,324 — — 623,839 — Premium finance 766 982,442 0.08 387 922,551 0.04 (1,202) 752,094 (0.16) Real estate - construction and development (949) 2,162,424 (0.04) (865) 1,761,853 (0.05) (273) 1,493,855 (0.02) Real estate - commercial and farmland 3,693 7,811,671 0.05 3,349 7,155,542 0.05 1,279 5,958,257 0.02 Real estate - residential (628) 4,668,312 (0.01) (301) 3,749,716 (0.01) (464) 2,883,135 (0.02) $ 50,381 $ 20,154,321 0.25 % $ 14,515 $ 17,521,461 0.08 % $ 6,191 $ 14,703,956 0.04 % The following table provides an analysis of the allowance for credit losses on loans held for investment.
December 31, 2024 2023 2022 (dollars in thousands) Amount % of Loans to Total Loans Amount % of Loans to Total Loans Amount % of Loans to Total Loans Commercial and industrial $ 87,242 14 % $ 64,053 13 % $ 39,455 13 % Consumer 7,327 1 3,952 1 5,587 3 Mortgage warehouse 2,262 5 1,678 4 2,118 5 Municipal 58 2 345 2 357 3 Premium finance 736 5 602 5 1,025 5 Real estate – construction and development 60,421 10 61,017 11 32,659 11 Real estate – commercial and farmland 118,377 41 110,097 40 67,433 38 Real estate - residential 61,661 22 65,356 24 57,043 22 Total $ 338,084 100 % $ 307,100 100 % $ 205,677 100 % 47 The following table provides an analysis of the net charge-offs (recoveries) by loan category for the years ended December 31, 2024, 2023 and 2022. 2024 2023 2022 Net charge-offs (recoveries) Average Balance Rate Net charge-offs (recoveries) Average balance Rate Net charge-offs (recoveries) Average balance Rate Commercial and industrial $ 36,537 $ 2,848,632 1.28 % $ 43,646 $ 2,687,805 1.62 % $ 8,681 $ 2,116,723 0.41 % Consumer 2,592 242,512 1.07 3,853 375,783 1.03 3,264 392,467 0.83 Mortgage warehouse — 948,484 — — 963,035 — — 891,285 — Municipal — 464,259 — — 502,849 — — 531,324 — Premium finance 474 1,102,157 0.04 766 982,442 0.08 387 922,551 0.04 Real estate - construction and development (59) 2,197,079 — (949) 2,162,424 (0.04) (865) 1,761,853 (0.05) Real estate - commercial and farmland (603) 8,216,256 (0.01) 3,693 7,811,671 0.05 3,349 7,155,542 0.05 Real estate - residential (84) 4,739,868 — (628) 4,668,312 (0.01) (301) 3,749,716 (0.01) $ 38,857 $ 20,759,247 0.19 % $ 50,381 $ 20,154,321 0.25 % $ 14,515 $ 17,521,461 0.08 % The following table provides an analysis of the allowance for credit losses on loans held for investment.
Year Ended December 31, 2023 2022 (dollars in thousands) Amount Rate Amount Rate Noninterest-bearing demand $ 6,771,464 — % $ 8,005,201 — % NOW 3,878,034 1.79 3,675,586 0.39 Money market 5,382,865 3.02 5,128,497 0.65 Savings 936,454 0.68 1,005,752 0.13 Retail time deposits 2,031,828 3.13 1,604,978 0.46 Brokered time deposits 1,024,606 5.24 — — Total deposits $ 20,025,251 1.78 % $ 19,420,014 0.29 % At December 31, 2023, the Company had brokered deposits of $1.14 billion.
Year Ended December 31, 2024 2023 (dollars in thousands) Amount Rate Amount Rate Noninterest-bearing demand $ 6,567,855 — % $ 6,771,464 — % NOW 3,824,094 2.12 3,878,034 1.79 Money market 6,395,883 3.61 5,382,865 3.02 Savings 776,273 0.49 936,454 0.68 Retail time deposits 2,440,891 4.21 2,031,828 3.13 Brokered time deposits 1,274,933 5.17 1,024,606 5.24 Total deposits $ 21,279,929 2.28 % $ 20,025,251 1.78 % At December 31, 2024, the Company had brokered deposits of $810.1 million.
(dollars in thousands) December 31, 2023 Three months or less $ 268,104 Over three months through six months 177,888 Over six months through one year 297,029 Over one year 30,982 Total $ 774,003 As of December 31, 2023 and 2022, the Company had estimated uninsured deposits of $9.13 billion and $9.30 billion, respectively.
(dollars in thousands) December 31, 2024 Three months or less $ 311,841 Over three months through six months 331,698 Over six months through one year 184,299 Over one year 15,941 Total $ 843,779 As of December 31, 2024 and 2023, the Company had estimated uninsured deposits of $10.24 billion and $9.13 billion, respectively.
December 31, (dollars in thousands) 2023 2022 Nonaccrual loans Commercial, financial and agricultural $ 8,059 $ 11,094 Consumer 1,153 420 Indirect automobile 299 346 Real estate - construction and development 282 523 Real estate - commercial and farmland 11,295 13,203 Real estate - residential (1) 130,029 109,222 Total $ 151,117 $ 134,808 Loans contractually past due 90 days or more as to interest or principal payments and still accruing $ 16,988 $ 17,865 (1) Included in real estate - residential were $90.2 million and $69.6 million of serviced GNMA-guaranteed nonaccrual loans at December 31, 2023 and 2022, respectively.
The following table presents an analysis of loans accounted for on a nonaccrual basis and loans contractually past due 90 days or more as to interest or principal payments and still accruing. 48 December 31, (dollars in thousands) 2024 2023 Nonaccrual loans Commercial and industrial $ 11,875 $ 8,059 Consumer 782 1,452 Real estate - construction and development 3,718 282 Real estate - commercial and farmland 11,960 11,295 Real estate - residential (1) 73,883 130,029 Total $ 102,218 $ 151,117 Loans contractually past due 90 days or more as to interest or principal payments and still accruing $ 17,733 $ 16,988 (1) Included in real estate - residential were $12.0 million and $90.2 million of serviced GNMA-guaranteed nonaccrual loans at December 31, 2024 and 2023, respectively.
Years Ended December 31, (dollars in thousands) 2023 2022 2021 Service charges on deposit accounts $ 46,575 $ 44,499 $ 45,106 Mortgage banking activity 139,885 184,904 285,900 Other service charges, commissions and fees 4,401 3,875 4,188 Net gain (loss) on securities (304) 203 515 Gain on sale of SBA loans 1,557 5,552 6,623 Other noninterest income 50,714 45,391 23,212 $ 242,828 $ 284,424 $ 365,544 2023 compared with 2022.
Years Ended December 31, (dollars in thousands) 2024 2023 2022 Service charges on deposit accounts $ 50,893 $ 46,575 $ 44,499 Mortgage banking activity 160,475 139,885 184,904 Other service charges, commissions and fees 4,758 4,401 3,875 Net gain (loss) on securities 12,304 (304) 203 Equipment finance activity 21,664 23,349 19,178 Other noninterest income 43,163 28,922 31,765 Total noninterest income $ 293,257 $ 242,828 $ 284,424 2024 compared with 2023.
December 31, (dollars in thousands) 2023 2022 Commercial, financial and agricultural $ 2,688,929 $ 2,679,403 Consumer 241,552 384,037 Indirect automobile 34,257 108,648 Mortgage warehouse 818,728 1,038,924 Municipal 492,668 509,151 Premium finance 946,562 1,023,479 Real estate - construction and development 2,129,187 2,086,438 Real estate - commercial and farmland 8,059,754 7,604,867 Real estate - residential 4,857,666 4,420,306 Loans, net of unearned income $ 20,269,303 $ 19,855,253 The Company seeks to diversify its loan portfolio across its geographic footprint and in various loan types.
December 31, (dollars in thousands) 2024 2023 Commercial and industrial $ 2,953,135 $ 2,688,929 Consumer 221,735 275,809 Mortgage warehouse 965,053 818,728 Municipal 441,408 492,668 Premium finance 1,155,614 946,562 Real estate - construction and development 1,998,506 2,129,187 Real estate - commercial and farmland 8,445,958 8,059,754 Real estate - residential 4,558,497 4,857,666 Loans, net of unearned income $ 20,739,906 $ 20,269,303 The Company seeks to diversify its loan portfolio across its geographic footprint and in various loan types.
Gain on BOLI proceeds is non-taxable and no tax effect is included. A portion of the merger and conversion charges for 2022 are nondeductible for tax purposes.
Gain on BOLI proceeds is non-taxable and no tax effect is included.
Income from mortgage banking activities decreased $101.0 million, or 35.3%, to $184.9 million during 2022 compared with 2021. This decrease was a result of a decline in production and tightening of gain on sale spreads compared with 2021.
Income from mortgage banking activities increased $20.6 million, or 14.7%, to $160.5 million during 2024 compared with 2023. This increase was a result of increases in production and gain on sale spreads compared with 2023.
Payments Due After December 31, 2023 (dollars in thousands) Total 1 Year or Less 1-3 Years 4-5 Years >5 Years Deposits without a stated maturity $ 17,240,603 $ 17,240,603 $ — $ — $ — Time certificates of deposit 3,467,906 3,333,066 107,084 27,004 752 Other borrowings 511,324 160,000 25,000 15,000 311,324 Subordinated deferrable interest debentures 154,390 — — — 154,390 Operating lease obligations 63,060 11,245 17,717 13,565 20,533 Total contractual cash obligations $ 21,437,283 $ 20,744,914 $ 149,801 $ 55,569 $ 486,999 At December 31, 2023, estimated costs to complete construction projects in progress and other binding commitments for capital expenditures were not a material amount. 50 CAPITAL ADEQUACY Capital Regulations The capital resources of the Company are monitored on a periodic basis by state and federal regulatory authorities.
Payments Due After December 31, 2024 (dollars in thousands) Total 1 Year or Less 1-3 Years 4-5 Years >5 Years Deposits without a stated maturity $ 18,489,790 $ 18,489,790 $ — $ — $ — Time certificates of deposit 3,232,658 3,136,954 73,910 21,716 78 Other borrowings 292,179 75,000 15,000 — 202,179 Subordinated deferrable interest debentures 154,390 — — — 154,390 Operating lease obligations 57,672 10,246 18,055 12,508 16,863 Total contractual cash obligations $ 22,226,689 $ 21,711,990 $ 106,965 $ 34,224 $ 373,510 At December 31, 2024, estimated costs to complete construction projects in progress and other binding commitments for capital expenditures were not a material amount. 54 CAPITAL ADEQUACY Capital Regulations The capital resources of the Company are monitored on a periodic basis by state and federal regulatory authorities.
Total noninterest expense for 2021 includes approximately $4.2 million in merger-related charges and $510,000 in losses on sale of bank premises. Excluding these amounts, expenses in 2022 increased by $3.9 million, or 0.7%, compared with 2021 levels. Salaries and benefits decreased $18.1 million, or 5.3%, from $337.8 million in 2021 to $319.7 million in 2022.
Total noninterest expense for 2023 includes approximately $11.6 million in FDIC special assessment and $1.9 million in gains on disposition of bank premises. Excluding these amounts, expenses in 2024 increased by $36.0 million, or 6.33%, compared with 2023 levels. Salaries and benefits increased from $320.1 million in 2023 to $347.6 million in 2024.
The increase in the allowance for credit losses on loans as a percentage of loans compared with December 31, 2022 was primarily attributable to a decline in forecast economic conditions, particularly commercial real estate price levels, in the Company's CECL model.
The increase in the allowance for credit losses on loans as a percentage of loans compared with December 31, 2023 was primarily attributable to among other things, a negative trend in forecast levels of commercial real estate prices and increased unemployment, partially offset by improvements in forecast levels of home prices and gross domestic product compared with the forecast at December 31, 2023.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeEarnings Simulation Model Results Change in % Change in Projected Baseline Interest Rates Net Interest Income (in bps) 12 Months 24 Months 300 (1.7)% 6.1% 200 0.6% 5.6% 100 0.6% 3.1% (100) (0.8)% (3.5)% (200) (1.8)% (7.5)% (300) (3.0)% (12.0)% In the event of a shift in interest rates, we may take certain actions intended to mitigate the negative impact to net interest income or to maximize the positive impact to net interest income.
Biggest changeEarnings Simulation Model Results Change in % Change in Projected Baseline Interest Rates Net Interest Income (in bps) 12 Months 24 Months 400 1.7% 11.0% 300 1.5% 9.9% 200 1.1% 7.0% 100 0.7% 3.9% (100) (0.7)% (4.0)% (200) (1.3)% (8.4)% (300) (2.2)% (13.6)% In the event of a shift in interest rates, we may take certain actions intended to mitigate the negative impact to net interest income or to maximize the positive impact to net interest income.
Our most recent model projects net interest income would increase if rates rise 100 basis points over the next year. The following table presents the earnings simulation model’s projected impact of a change in interest rates on the projected baseline net interest income for the 12- and 24-month periods commencing January 1, 2024.
Our most recent model projects net interest income would increase if rates rise 100 basis points over the next year. The following table presents the earnings simulation model’s projected impact of a change in interest rates on the projected baseline net interest income for the 12- and 24-month periods commencing January 1, 2025.
As a result, interest rates have a greater impact on our performance than do the effects of general levels of inflation. Interest rates do not necessarily move in the same direction or to the same extent as the prices of goods and services. 54
As a result, interest rates have a greater impact on our performance than do the effects of general levels of inflation. Interest rates do not necessarily move in the same direction or to the same extent as the prices of goods and services. 58

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