ServisFirst Bancshares, Inc. (NYSE:SFBS), today announced earnings and operating results for the quarter ended September 30, 2023.

Third Quarter 2023 Highlights:

Reached milestone of $16.0 billion in total assets, a 9.9% increase year-to-date.
$13.1 billion in total deposits, a 7% increase from second quarter 2023 and a 13.8% increase year-to-date.
$2.0 billion in cash on hand with no FHLB advances or brokered deposits.
Diluted net income per share of $0.98 for the quarter.
Book value per share of $25.75, up 7.6% year-to-date and 12.6% from the third quarter of 2022.
Loans grew $362.5 million, or 3%, from the third quarter of 2022. Our loan pipeline is improving.
An increase of 19% in new deposit accounts opened year-over-year.
Credit quality continues to be strong with non-performing assets to total assets of 0.15%.
Consolidated Common Equity Tier 1 capital to risk-weighted assets increased from 9.42% to 10.69% year-over-year.

Tom Broughton, Chairman, President and CEO, said, "We are proud to reach the $16 billion in assets milestone in the quarter, with current cash exceeding $2 billion and no FHLB advances or brokered deposits. We believe this gives our bank a significant competitive advantage."

Bud Foshee, CFO, said, "We continue to see strong asset quality with record low past dues, while loan pipelines and activity are beginning to rebuild, which should improve profitability in coming quarters."

FINANCIAL SUMMARY (UNAUDITED)
(in Thousands except share and per share amounts)	Period Ending September 30, 2023			Period Ending June 30, 2023			% Change From Period Ending June 30, 2023 to Period Ending September 30, 2023			Period Ending September 30, 2022			% Change From Period Ending September 30, 2022 to Period Ending September 30, 2023
QUARTERLY OPERATING RESULTS
Net Income	$	53,340		$	53,468		-		%	$	64,031		(17	)	%
Net Income Available to Common Stockholders	$	53,340		$	53,437		-		%	$	64,031		(17	)	%
Diluted Earnings Per Share	$	0.98		$	0.98		-		%	$	1.17		(17	)	%
Return on Average Assets		1.37	%		1.50	%					1.77	%
Return on Average Common Stockholders' Equity		15.12	%		15.85	%					20.49	%
Average Diluted Shares Outstanding		54,530,635			54,527,317						54,546,682

YEAR-TO-DATE OPERATING RESULTS
Net Income	$	164,779								$	183,780		(10	)	%
Net Income Available to Common Stockholders	$	164,748								$	183,749		(10	)	%
Diluted Earnings Per Share	$	3.02								$	3.37		(10	)	%
Return on Average Assets		1.50	%								1.64	%
Return on Average Common Stockholders' Equity		16.23	%								20.43	%
Average Diluted Shares Outstanding		54,530,797									54,533,793

BALANCE SHEET
Total Assets	$	16,044,332		$	15,072,808		6		%	$	13,890,030		16		%
Loans		11,641,130			11,604,894		-		%		11,278,614		3		%
Non-interest-bearing Demand Deposits		2,621,072			2,855,102		(8	)	%		3,661,936		(28	)	%
Total Deposits		13,142,376			12,288,219		7		%		11,051,915		19		%
Stockholders' Equity		1,401,384			1,363,471		3		%		1,242,589		13		%

DETAILED FINANCIALS

ServisFirst Bancshares, Inc. reported net income and net income available to common stockholders of $53.3 million for the quarter ended September 30, 2023, compared to net income of $53.5 million and net income available to common stockholders of $53.4 million for the second quarter of 2023 and net income and net income available to common stockholders of $64.0 million for the third quarter of 2022. Basic and diluted earnings per common share were both $0.98 in the third quarter of 2023, compared to $0.98 for both in the second quarter of 2023 and $1.18 and $1.17, respectively, in the third quarter of 2022.

Annualized return on average assets was 1.37% and annualized return on average common stockholders' equity was 15.12% for the third quarter of 2023, compared to 1.77% and 20.49%, respectively, for the third quarter of 2022.

Net interest income was $99.7 million for the third quarter of 2023, compared to $101.3 million for the second quarter of 2023 and $126.4 million for the third quarter of 2022. Net interest income was negatively impacted by the continued narrowing in net interest spread due to Federal Reserve increases in interest rates over the last year. The net interest margin in the third quarter of 2023 was 2.64% compared to 2.93% in the second quarter of 2023 and 3.64% in the third quarter of 2022. Loan yields were 6.13% during the third quarter of 2023 compared to 5.94% during the second quarter of 2023 and 4.77% during the third quarter of 2022. Investment yields were 3.07% during the third quarter of 2023 compared to 2.64% during the second quarter of 2023 and 2.47% during the third quarter of 2022. Average interest-bearing deposit rates were 3.84% during the third quarter of 2023, compared to 3.32% during the second quarter of 2023 and 0.76% during the third quarter of 2022. Average federal funds purchased rates were 5.43% during third quarter of 2023, compared to 5.14% during the second quarter of 2023 and 2.27% during the third quarter of 2022.

Average loans for the third quarter of 2023 were $11.56 billion, a decrease of $36.3 million, or 1.2% annualized, from average loans of $11.60 billion for the second quarter of 2023, and an increase of $643.1 million, or 5.9%, from average loans of $10.92 billion for the third quarter of 2022.

Average total deposits for the third quarter of 2023 were $12.68 billion, an increase of $1.10 billion, or 37.5% annualized, over average total deposits of $11.58 billion for the second quarter of 2023, and an increase of $1.15 billion, or 9.9%, from average total deposits of $11.53 billion for the third quarter of 2022.

Non-performing assets to total assets were 0.15% for the third quarter of 2023, compared to 0.16% for the second quarter of 2023 and 0.13% for the third quarter of 2022. Annualized net charge-offs to average loans were 0.15% for the third quarter of 2023, compared to 0.11% for both the second quarter of 2023 and third quarter of 2022. The allowance for credit losses as a percentage of total loans at September 30, 2023, June 30, 2023, and September 30, 2022, was 1.31%, 1.31%, and 1.25%, respectively. We recorded a $4.3 million provision for credit losses in the third quarter of 2023 compared to $6.7 million in the second quarter of 2023, and $15.6 million in the third quarter of 2022.

Non-interest income decreased $804,000, or 9.0%, to $8.1 million for the third quarter of 2023 from $8.9 million in the third quarter of 2022, and decreased $447,000, or 5.2%, on a linked quarter basis. Service charges on deposit accounts increased $271,000, or 14.3%, to $2.2 million from the third quarter of 2022 to the third quarter of 2023, and increased $21,000, or 1.0%, on a linked quarter basis. Mortgage banking revenue increased $41,000, or 5.2%, to $825,000 from the third quarter of 2022 to the third quarter of 2023, and increased $129,000, or 18.5%, on a linked quarter basis. Net credit card revenue decreased $80,000, or 3.1%, to $2.5 million during the third quarter of 2023, compared to $2.6 million during the third quarter of 2022, and increased $126,000, or 5.2%, on a linked quarter basis. The aggregate amount of spend on all credit card accounts decreased 2.0% during the third quarter of 2023 compared to the third quarter of 2022. Bank-owned life insurance ("BOLI") income increased $181,000, or 11.1%, to $1.8 million during the third quarter of 2023, compared to $1.6 million during the third quarter of 2022, and decreased $678,000, or 27.2%, on a linked quarter basis. During the second quarter of 2023, we recognized $890,000 of income primarily attributed to a death benefit related to a former employee in our BOLI program. Other operating income for the third quarter of 2023 decreased $1.2 million, or 60.4%, to $797,000 from $2.0 million in the third quarter of 2022, and decreased $45,000, or 5.3%, on a linked quarter basis. We recognized $1.3 million of income on an interest rate cap during the third quarter of 2022. The interest rate cap matured during the second quarter of 2023. Merchant service revenue increased $125,000, or 26.7%, to $594,000 for the third quarter of 2023 from $468,000 in the third quarter of 2022.

Non-interest expense for the third quarter of 2023 decreased $1.0 million, or 2.4%, to $41.7 million from $42.7 million in the third quarter of 2022, and increased $3.2 million, or 8.3%, on a linked quarter basis. Salary and benefit expense for the third quarter of 2023 increased $393,000, or 2.0%, to $20.1 million from $19.7 million in the third quarter of 2022, and increased $1.3 million, or 6.8%, on a linked quarter basis. The increase in the linked quarter is primarily attributed to higher incentive accruals. The number of FTE employees increased by 10 to 568 at September 30, 2023 compared to 558 at September 30, 2022, and decreased by 9 from the end of the second quarter of 2023. Equipment and occupancy expense increased $439,000, or 14.0%, to $3.6 million in the third quarter of 2023, from $3.1 million in the third quarter of 2022, and increased $158,000, or 4.6% on a linked-quarter basis. The year-over-year increase is primarily attributed to new leases that began after the third quarter of 2022. Third party processing and other services expense decreased $664,000, or 9.2%, to $6.5 million in the third quarter of 2023, from $7.2 million in the third quarter of 2022, and increased $351,000, or 5.7%, on a linked-quarter basis. Professional services expense increased $229,000, or 22.1%, to $1.3 million in the third quarter of 2023, from $1.0 million in the third quarter of 2022. FDIC and other regulatory assessments increased $1.4 million to $2.3 million in the third quarter of 2023, from $975,000 in the third quarter of 2022, and increased $104,000, or 4.6%, on a linked quarter basis. The FDIC increased the assessment rate by two basis points beginning in the first quarter of 2023. Other operating expenses for the third quarter of 2023 decreased $2.8 million, or 26.3%, to $7.8 million from $10.6 million in the third quarter of 2022, and increased $1.6 million, or 25.7%, on a linked-quarter basis. During the third quarter of 2022 we reached a preliminary settlement on a lawsuit and wrote down the value of a private investment resulting in charges of $3.1 million, or $2.4 million net of income tax. The efficiency ratio was 38.64% during the third quarter of 2023 compared to 31.54% during the third quarter of 2022 and 35.02% during the second quarter of 2023.

Income tax expense decreased $4.5 million, or 34.4%, to $8.5 million in the third quarter of 2023, compared to $13.0 million in the third quarter of 2022, mostly due to lower pretax net income. Our effective tax rate was 13.81% for the third quarter of 2023 compared to 16.92% for the third quarter of 2022. We recognized an aggregate of $3.7 million in credits during the third quarter of 2023 related to investments in tax credit partnerships, compared to $3.1 million during the third quarter of 2022. We did not recognize a reduction in provision for income taxes resulting from excess tax benefits from the exercise and vesting of stock options and restricted stock during the third quarter of 2023, compared to $370,000 during the third quarter of 2022.

About ServisFirst Bancshares, Inc.

ServisFirst Bancshares, Inc. is a bank holding company based in Birmingham, Alabama. Through its subsidiary ServisFirst Bank, ServisFirst Bancshares, Inc. provides business and personal financial services from locations in Alabama, Florida, Georgia, North and South Carolina, Tennessee, and Virginia. We also operate loan production offices in Florida and North Carolina. Through the bank, we originate commercial, consumer and other loans and accept deposits, provide electronic banking services, such as online and mobile banking, including remote deposit capture, deliver treasury and cash management services and provide correspondent banking services to other financial institutions.

ServisFirst Bancshares, Inc. files periodic reports with the U.S. Securities and Exchange Commission (SEC). Copies of its filings may be obtained through the SEC's website at www.sec.gov or at www.servisfirstbancshares.com.

Statements in this press release that are not historical facts, including, but not limited to, statements concerning future operations, results or performance, are hereby identified as "forward-looking statements" for the purpose of the safe harbor provided by Section 21E of the Securities Exchange Act of 1934 and Section 27A of the Securities Act of 1933. The words "believe," "expect," "anticipate," "project," "plan," "intend," "will," "could," "would," "might" and similar expressions often signify forward-looking statements. Such statements involve inherent risks and uncertainties. ServisFirst Bancshares, Inc. cautions that such forward-looking statements, wherever they occur in this press release or in other statements attributable to ServisFirst Bancshares, Inc., are necessarily estimates reflecting the judgment of ServisFirst Bancshares, Inc.'s senior management and involve a number of risks and uncertainties that could cause actual results to differ materially from those suggested by the forward-looking statements. Such forward-looking statements should, therefore, be considered in light of various factors that could affect the accuracy of such forward-looking statements, including, but not limited to: general economic conditions, especially in the credit markets and in the Southeast; the performance of the capital markets; changes in interest rates, yield curves and interest rate spread relationships; changes in accounting and tax principles, policies or guidelines; changes in legislation or regulatory requirements; changes as a result of our reclassification as a large financial institution by the FDIC; changes in our loan portfolio and the deposit base; credit issues associated with the efficacy of return to office policies; possible changes in laws and regulations and governmental monetary and fiscal policies, including, but not limited to, the Federal Reserve policies in connection with continued inflationary pressures and the ability of the U.S. Congress to increase the U.S. statutory debt limit as needed; the cost and other effects of legal and administrative cases and similar contingencies; possible changes in the creditworthiness of customers and the possible impairment of the collectability of loans and the value of collateral; the effect of natural disasters, such as hurricanes and tornados, in our geographic markets; and increased competition from both banks and non-bank financial institutions. The foregoing list of factors is not exhaustive. For discussion of these and other risks that may cause actual results to differ from expectations, please refer to "Cautionary Note Regarding Forward-looking Statements" and "Risk Factors" in our most recent Annual Report on Form 10-K, in our Quarterly Reports on Form 10-Q for fiscal year 2023, and our other SEC filings. If one or more of the factors affecting our forward-looking information and statements proves incorrect, then our actual results, performance or achievements could differ materially from those expressed in, or implied by, forward-looking information and statements contained herein. Accordingly, you should not place undue reliance on any forward-looking statements, which speak only as of the date made. ServisFirst Bancshares, Inc. assumes no obligation to update or revise any forward-looking statements that are made from time to time.

More information about ServisFirst Bancshares, Inc. may be obtained over the Internet at www.servisfirstbancshares.com or by calling (205) 949-0302.

SELECTED FINANCIAL HIGHLIGHTS (UNAUDITED)
(In thousands except share and per share data)
	3rd Quarter 2023			2nd Quarter 2023			1st Quarter 2023			4th Quarter 2022			3rd Quarter 2022
CONSOLIDATED STATEMENT OF INCOME
Interest income	$	213,206		$	189,656		$	181,322		$	170,273		$	149,299
Interest expense		113,508			88,405			73,021			47,889			22,881
Net interest income		99,698			101,251			108,301			122,384			126,418
Provision for credit losses		4,282			6,654			4,197			7,135			15,603
Net interest income after provision for credit losses		95,416			94,597			104,104			115,249			110,815
Non-interest income		8,135			8,582			6,321			6,966			8,939
Non-interest expense		41,663			38,466			39,664			38,092			42,685
Income before income tax		61,888			64,713			70,761			84,123			77,069
Provision for income tax		8,548			11,245			12,790			16,399			13,038
Net income		53,340			53,468			57,971			67,724			64,031
Preferred stock dividends		-			31			-			31			-
Net income available to common stockholders	$	53,340		$	53,437		$	57,971		$	67,693		$	64,031
Earnings per share - basic	$	0.98		$	0.98		$	1.07		$	1.25		$	1.18
Earnings per share - diluted	$	0.98		$	0.98		$	1.06		$	1.24		$	1.17
Average diluted shares outstanding		54,530,635			54,527,317			54,534,482			54,537,716			54,546,682

CONSOLIDATED BALANCE SHEET DATA
Total assets	$	16,044,332		$	15,072,808		$	14,566,559		$	14,595,753		$	13,890,030
Loans		11,641,130			11,604,894			11,629,802			11,687,968			11,278,614
Debt securities		1,878,701			2,048,227			1,646,937			1,678,936			1,714,603
Non-interest-bearing demand deposits		2,621,072			2,855,102			2,898,736			3,321,347			3,661,936
Total deposits		13,142,376			12,288,219			11,615,317			11,546,805			11,051,915
Borrowings		64,751			64,737			65,417			64,726			64,721
Stockholders' equity		1,401,384			1,363,471			1,339,817			1,297,896			1,242,589

Shares outstanding		54,425,447			54,425,033			54,398,025			54,326,527			54,324,007
Book value per share	$	25.75		$	25.05		$	24.63		$	23.89		$	22.87
Tangible book value per share (1)	$	25.50		$	24.80		$	24.38		$	23.64		$	22.62

SELECTED FINANCIAL RATIOS (Annualized)
Net interest margin		2.64	%		2.93	%		3.15	%		3.52	%		3.64	%
Return on average assets		1.37	%		1.50	%		1.63	%		1.89	%		1.77	%
Return on average common stockholders' equity		15.12	%		15.85	%		17.83	%		21.27	%		20.49	%
Efficiency ratio		38.64	%		35.02	%		34.60	%		29.45	%		31.54	%
Non-interest expense to average earning assets		1.10	%		1.11	%		1.15	%		1.10	%		1.23	%

CAPITAL RATIOS (2)
Common equity tier 1 capital to risk-weighted assets		10.69	%		10.37	%		10.01	%		9.55	%		9.42	%
Tier 1 capital to risk-weighted assets		10.69	%		10.38	%		10.02	%		9.55	%		9.43	%
Total capital to risk-weighted assets		12.25	%		11.94	%		11.54	%		11.03	%		10.96	%
Tier 1 capital to average assets		9.35	%		9.83	%		9.49	%		9.29	%		8.84	%
Tangible common equity to total tangible assets (1)		8.66	%		8.96	%		9.11	%		8.81	%		8.86	%

(1) This press release also contains certain non-GAAP financial measures, including tangible common stockholders' equity, total tangible assets, tangible book value per share and tangible common equity to total tangible assets, each of which excludes goodwill associated with our acquisition of Metro Bancshares, Inc. in January 2015.
(2) Regulatory capital ratios for most recent period are preliminary.

GAAP Reconciliation and Management Explanation of Non-GAAP Financial Measures

This press release contains certain non-GAAP financial measures, including tangible common stockholders' equity, total tangible assets, tangible book value per share and tangible common equity to total tangible assets, each of which excludes goodwill associated with our acquisition of Metro Bancshares, Inc. in January 2015. We believe these non-GAAP financial measures provide useful information to management and investors that is supplementary to our financial condition, results of operations and cash flows computed in accordance with GAAP; however, we acknowledge that these non-GAAP financial measures have a number of limitations. As such, you should not view these disclosures as a substitute for results determined in accordance with GAAP, and they are not necessarily comparable to non-GAAP financial measures that other companies, including those in our industry, use. The following reconciliation table provides a more detailed analysis of the non-GAAP financial measures as of and for the comparative periods presented in this press release. Dollars are in thousands, except share and per share data.

	At September 30, 2023				At June 30, 2023				At March 31, 2023				At December 31, 2022				At September 30, 2022
Book value per share - GAAP	$	25.75			$	25.05			$	24.63			$	23.89			$	22.87
Total common stockholders' equity - GAAP		1,401,384				1,363,471				1,339,817				1,297,896				1,242,589
Adjustment for Goodwill		(13,615	)			(13,615	)			(13,615	)			(13,615	)			(13,615	)
Tangible common stockholders' equity - non-GAAP	$	1,387,769			$	1,349,856			$	1,326,202			$	1,284,281			$	1,228,974
Tangible book value per share - non-GAAP	$	25.50			$	24.80			$	24.38			$	23.64			$	22.62

Stockholders' equity to total assets - GAAP		8.73		%		9.05		%		9.20		%		8.89		%		8.95		%
Total assets - GAAP	$	16,044,332			$	15,072,808			$	14,566,559			$	14,595,753			$	13,890,030
Adjustment for Goodwill		(13,615	)			(13,615	)			(13,615	)			(13,615	)			(13,615	)
Total tangible assets - non-GAAP	$	16,030,717			$	15,059,193			$	14,552,944			$	14,582,138			$	13,876,415
Tangible common equity to total tangible assets - non-GAAP		8.66		%		8.96		%		9.11		%		8.81		%		8.86		%

CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(Dollars in thousands)
	September 30, 2023			September 30, 2022			% Change
ASSETS
Cash and due from banks	$	112,150		$	249,051		(55	)	%
Interest-bearing balances due from depository institutions		1,861,924			156,959		1,086		%
Federal funds sold		91,035			82,316		11		%
Cash and cash equivalents		2,065,109			488,326		323		%
Available for sale debt securities, at fair value		834,802			665,763		25		%
Held to maturity debt securities (fair value of $933,006 and $942,282, respectively)		1,043,899			1,048,840		-		%
Restricted equity securities		10,226			7,734		32		%
Mortgage loans held for sale		6,333			2,003		216		%
Loans		11,641,130			11,278,614		3		%
Less allowance for credit losses		(152,247	)		(140,967	)	8		%
Loans, net		11,488,883			11,137,647		3		%
Premises and equipment, net		59,516			59,080		1		%
Goodwill and other identifiable intangible assets		13,615			13,615		-		%
Other assets		521,949			467,022		12		%
Total assets	$	16,044,332		$	13,890,030		16		%
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Deposits:
Non-interest-bearing	$	2,621,072		$	3,661,936		(28	)	%
Interest-bearing		10,521,304			7,389,979		42		%
Total deposits		13,142,376			11,051,915		19		%
Federal funds purchased		1,370,289			1,466,322		(7	)	%
Other borrowings		64,751			64,721		-		%
Other liabilities		65,532			64,483		2		%
Total liabilities		14,642,948			12,647,441		16		%
Stockholders' equity:
Preferred stock, par value $0.001 per share; 1,000,000 authorized and undesignated at
September 30, 2023 and September 30, 2022		-			-		-		%
Common stock, par value $0.001 per share; 200,000,000 shares authorized; 54,425,447 shares
issued and outstanding at September 30, 2023, and 54,324,007
shares issued and outstanding at September 30, 2022		54			54		-		%
Additional paid-in capital		231,588			228,738		1		%
Retained earnings		1,229,080			1,057,387		16		%
Accumulated other comprehensive loss		(59,838	)		(44,090	)	36		%
Total stockholders' equity attributable to ServisFirst Bancshares, Inc.		1,400,884			1,242,089		13		%
Noncontrolling interest		500			500		-		%
Total stockholders' equity		1,401,384			1,242,589		13		%
Total liabilities and stockholders' equity	$	16,044,332		$	13,890,030		16		%

CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
(In thousands except per share data)
	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Interest income:
Interest and fees on loans	$	178,754	$	131,375	$	514,204	$	345,767
Taxable securities		15,522		11,089		37,987		29,827
Nontaxable securities		15		30		53		110
Federal funds sold		985		632		1,826		738
Other interest and dividends		17,930		6,173		30,114		12,600
Total interest income		213,206		149,299		584,184		389,042
Interest expense:
Deposits		95,901		13,655		223,585		25,925
Borrowed funds		17,607		9,226		51,349		14,609
Total interest expense		113,508		22,881		274,934		40,534
Net interest income		99,698		126,418		309,250		348,508
Provision for credit losses		4,282		15,603		15,133		30,472
Net interest income after provision for credit losses		95,416		110,815		294,117		318,036
Non-interest income:
Service charges on deposit accounts		2,163		1,892		6,239		6,167
Mortgage banking		825		784		1,963		1,924
Credit card income		2,532		2,612		6,627		7,656
Securities losses		-		-		-		(6,168	)
Bank-owned life insurance income		1,818		1,637		5,935		6,978
Other operating income		797		2,014		2,274		9,836
Total non-interest income		8,135		8,939		23,038		26,393
Non-interest expense:
Salaries and employee benefits		20,080		19,687		57,941		58,722
Equipment and occupancy expense		3,579		3,140		10,435		9,056
Third party processing and other services		6,549		7,213		20,031		19,163
Professional services		1,265		1,036		4,499		3,355
FDIC and other regulatory assessments		2,346		975		6,105		3,254
Other real estate owned expense		18		21		30		56
Other operating expense		7,826		10,613		20,752		26,118
Total non-interest expense		41,663		42,685		119,793		119,724
Income before income tax		61,888		77,069		197,362		224,705
Provision for income tax		8,548		13,038		32,583		40,925
Net income		53,340		64,031		164,779		183,780
Dividends on preferred stock		-		-		31		31
Net income available to common stockholders	$	53,340	$	64,031	$	164,748	$	183,749
Basic earnings per common share	$	0.98	$	1.18	$	3.03	$	3.38
Diluted earnings per common share	$	0.98	$	1.17	$	3.02	$	3.37

LOANS BY TYPE (UNAUDITED)
(In thousands)

	3rd Quarter 2023		2nd Quarter 2023		1st Quarter 2023		4th Quarter 2022		3rd Quarter 2022
Commercial, financial and agricultural	$	2,890,535	$	2,986,453	$	3,081,926	$	3,145,317	$	3,104,155
Real estate - construction		1,509,937		1,397,732		1,469,670		1,532,388		1,433,698
Real estate - mortgage:
Owner-occupied commercial		2,237,684		2,294,002		2,243,436		2,199,280		2,145,621
1-4 family mortgage		1,170,099		1,167,238		1,138,645		1,146,831		1,089,826
Other mortgage		3,766,124		3,686,434		3,624,071		3,597,750		3,438,762
Subtotal: Real estate - mortgage		7,173,907		7,147,674		7,006,152		6,943,861		6,674,209
Consumer		66,751		73,035		72,054		66,402		66,552
Total loans	$	11,641,130	$	11,604,894	$	11,629,802	$	11,687,968	$	11,278,614

SUMMARY OF CREDIT LOSS EXPERIENCE (UNAUDITED)
(Dollars in thousands)
	3rd Quarter 2023			2nd Quarter 2023			1st Quarter 2023			4th Quarter 2022			3rd Quarter 2022
Allowance for credit losses:
Beginning balance	$	152,272		$	148,965		$	146,297		$	140,967		$	128,387
Loans charged off:
Commercial financial and agricultural		4,784			4,358			1,257			2,116			2,902
Real estate - construction		19			-			-			-			-
Real estate - mortgage		-			131			26			-			170
Consumer		341			111			390			200			261
Total charge offs		5,144			4,600			1,673			2,316			3,333
Recoveries:
Commercial financial and agricultural		825			1,233			128			393			297
Real estate - construction		-			-			3			-			-
Real estate - mortgage		-			-			1			-			-
Consumer		11			21			11			118			12
Total recoveries		836			1,254			143			511			309
Net charge-offs		4,308			3,346			1,530			1,805			3,024
Provision for credit losses		4,282			6,654			4,197			7,135			15,604
Ending balance	$	152,247		$	152,272		$	148,965		$	146,297		$	140,967

Allowance for credit losses to total loans		1.31	%		1.31	%		1.28	%		1.25	%		1.25	%
Allowance for credit losses to total average
loans		1.31	%		1.31	%		1.28	%		1.27	%		1.29	%
Net charge-offs to total average loans		0.15	%		0.11	%		0.05	%		0.06	%		0.11	%
Provision for credit losses to total average
loans		0.15	%		0.23	%		0.14	%		0.25	%		0.57	%
Nonperforming assets:
Nonaccrual loans	$	20,911		$	16,897		$	13,157		$	12,450		$	11,655
Loans 90+ days past due and accruing		1,692			5,947			4,683			5,391			4,803
Other real estate owned and
repossessed assets		690			832			248			248			1,245
Total	$	23,293		$	23,676		$	18,088		$	18,089		$	17,703

Nonperforming loans to total loans		0.19	%		0.20	%		0.15	%		0.15	%		0.15	%
Nonperforming assets to total assets		0.15	%		0.16	%		0.12	%		0.12	%		0.13	%
Nonperforming assets to earning assets		0.16	%		0.16	%		0.13	%		0.13	%		0.13	%
Allowance for credit losses to nonaccrual loans		731.74	%		901.18	%		1,132.24	%		1,175.08	%		1,209.50	%

CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
(In thousands except per share data)
	3rd Quarter 2023		2nd Quarter 2023		1st Quarter 2023		4th Quarter 2022		3rd Quarter 2022
Interest income:
Interest and fees on loans	$	178,754	$	171,718	$	163,732	$	153,924	$	131,375
Taxable securities		15,522		11,570		10,895		10,895		11,089
Nontaxable securities		15		17		21		27		30
Federal funds sold		985		227		614		818		632
Other interest and dividends		17,930		6,124		6,060		4,609		6,173
Total interest income		213,206		189,656		181,322		170,273		149,299
Interest expense:
Deposits		95,901		71,971		55,713		33,471		13,655
Borrowed funds		17,607		16,434		17,308		14,418		9,226
Total interest expense		113,508		88,405		73,021		47,889		22,881
Net interest income		99,698		101,251		108,301		122,384		126,418
Provision for credit losses		4,282		6,654		4,197		7,135		15,603
Net interest income after provision for credit losses		95,416		94,597		104,104		115,249		110,815
Non-interest income:
Service charges on deposit accounts		2,163		2,142		1,934		1,866		1,892
Mortgage banking		825		696		442		514		784
Credit card income		2,532		2,406		1,689		2,261		2,612
Bank-owned life insurance income		1,818		2,496		1,621		1,600		1,637
Other operating income		797		842		635		725		2,014
Total non-interest income		8,135		8,582		6,321		6,966		8,939
Non-interest expense:
Salaries and employee benefits		20,080		18,795		19,066		19,230		19,687
Equipment and occupancy expense		3,579		3,421		3,435		3,263		3,140
Third party processing and other services		6,549		6,198		7,284		8,170		7,213
Professional services		1,265		1,580		1,654		922		1,036
FDIC and other regulatory assessments		2,346		2,242		1,517		1,311		975
Other real estate owned expense		18		6		6		239		21
Other operating expense		7,826		6,224		6,702		4,957		10,613
Total non-interest expense		41,663		38,466		39,664		38,092		42,685
Income before income tax		61,888		64,713		70,761		84,123		77,069
Provision for income tax		8,548		11,245		12,790		16,399		13,038
Net income		53,340		53,468		57,971		67,724		64,031
Dividends on preferred stock		-		31		-		31		-
Net income available to common stockholders	$	53,340	$	53,437	$	57,971	$	67,693	$	64,031
Basic earnings per common share	$	0.98	$	0.98	$	1.07	$	1.25	$	1.18
Diluted earnings per common share	$	0.98	$	0.98	$	1.06	$	1.24	$	1.17

AVERAGE BALANCE SHEETS AND NET INTEREST ANALYSIS (UNAUDITED)
ON A FULLY TAXABLE-EQUIVALENT BASIS
(Dollars in thousands)

	3rd Quarter 2023				2nd Quarter 2023				1st Quarter 2023				4th Quarter 2022				3rd Quarter 2022
	Average Balance		Yield / Rate		Average Balance		Yield / Rate		Average Balance		Yield / Rate		Average Balance		Yield / Rate		Average Balance		Yield / Rate
Assets:
Interest-earning assets:
Loans, net of unearned income (1)
Taxable	$	11,545,003	6.13	%	$	11,581,008	5.94	%	$	11,632,439	5.70	%	$	11,465,538	5.32	%	$	10,900,105	4.77	%
Tax-exempt (2)		18,023	4.71			18,312	4.82			18,978	3.36

ServisFirst Bancshares, Inc. Announces Results For Third Quarter of 2023