Earnings release
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1 Considered non-GAAP financial measure - See "Non-GAAP Financial Measures" and reconciliation of GAAP to non-GAAP financial measures in tables 10A - 10E. 2 The Company defines production as original loan commitment amount, which includes both funded and unfunded balances at the time of origination. As of September 30, 2026, these loans had funded balances of $148.9 million and unfunded commitments of $74.1 million. EXHIBIT 99.1 FOR IMMEDIATE RELEASE 1 COASTALSOUTH BANCSHARES, INC. REPORTS EARNINGS FOR THIRD QUARTER 2026 ATLANTA, GA (October 19, 2026) – CoastalSouth Bancshares, Inc. (“CoastalSouth” or the “Company”) (NYSE: COSO), the holding company for Coastal States Bank (the “Bank” or "CSB"), today reported net income of $8.8 million, or $0.71 per diluted share, for the third quarter of 2026, compared to approximately $7.3 million, or $0.59 per diluted share, for the second quarter of 2026, and $6.7 million, or $0.54 per diluted share, for the third quarter of 2025. For the nine months ended September 30, 2026, the Company reported net income of $22.4 million, or $1.81 per diluted share, compared with $17.8 million, or $1.58 per diluted share, for the same period in 2025. Additionally, on October 19, 2026, the Board of Directors of CoastalSouth Bancshares, Inc. declared a per share quarterly dividend of $0.06. The dividend will be paid to shareholders of record as of the close of business on November 10, 2026, the record date. The dividend shall be paid on November 24, 2026. Commenting on the Company’s third quarter performance, President and Chief Executive Officer Stephen R. Stone stated, "We delivered record earnings of $0.71 per share in the third quarter, driven by strong loan production and robust gain-on-sale revenue from our government-guaranteed lending business. We saw outstanding loan production2 of $248.2 million during the third quarter, driving an $81.6 million increase in loans held-for-investment, or 19.0% annualized. The majority of production in the third quarter continued to come from the community bank, although our specialty lines of business also had a strong production quarter. As we head into the fourth quarter, we remain focused on building deep client relationships, maintaining disciplined underwriting, and investing in talented bankers across our footprint." Third Quarter 2026 Performance Highlights: • Net income of $8.8 million or $0.71 per diluted share • Return on average assets ("ROAA") of 1.45% • Return on average equity ("ROAE") of 12.88%; Return on average tangible common equity1 ("ROATCE") of 13.12%• Net interest margin of 3.70%, an increase of 4 basis points from the second quarter of 2026 • Total deposits increased $53.1 million, although core deposits1 were down quarter over quarter approximately $20.0 million which is primarily attributable to seasonal outflows associated with our property management clients • Loans held-for-investment ("LHFI") production2 of $248.2 million during the third quarter of 2026 led to LHFI growth of $81.6 million, up 19.0% annualized from the second quarter of 2026 • Accumulated other comprehensive loss ("AOCL") increased by $8.3 million from prior quarter due to increased unrealized losses in our available-for-sale securities portfolio • Book value per share decreased $0.15, or 2.65% annualized, to $22.32 at September 30, 2026; Tangible book value1 per common share decreased $0.16, or 2.88% annualized, to $21.90 at September 30, 2026 from the second quarter of 2026 • Share repurchase program launched May 1, 2026; 285,715 shares repurchased during the third quarter of 2026 with a weighted-average price of $27.10 • Total shareholders' equity to total assets of 10.81%, compared to 11.14% as of the second quarter of 2026; Tangible common equity1 to tangible assets1 of 10.63%, compared to 10.96% as of June 30, 2026 • Net charge-offs to average loans held for investment of 0.01% • Nonperforming assets to total assets of 0.62%; adjusted nonperforming assets to total assets1 of 0.45% • Allowance for credit losses ("ACL") on LHFI to total LHFI of 1.10%; total ACL on LHFI to nonperforming loans of 130.13%
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3 Considered non-GAAP financial measure - See "Non-GAAP Financial Measures" and reconciliation of GAAP to non-GAAP financial measures in tables 10A - 10E. 2 Operating Highlights Net interest income totaled $21.5 million for the third quarter of 2026, an increase of $862 thousand, or 4.2%, from $20.7 million for the second quarter of 2026, and an increase of $2.3 million, or 12.2% from the third quarter of 2025. The Company’s net interest margin increased by 4 basis points to 3.70% for the third quarter of 2026, compared to 3.66% for the second quarter of 2026, and increased 12 basis points from the third quarter of 2025. The yield on average interest-earning assets for the third quarter of 2026 increased to 5.99% from 5.94% for the second quarter of 2026. This increase was primarily related to an overall yield increase in average interest-earning assets across the board, principally investment securities, LHFI and loans held-for-sale ("LHFS"). Compared to the third quarter of 2025, yields on earning assets decreased 15 basis points to 5.99% from 6.14%. The decrease was primarily attributable to interest rate cuts during 2025, notwithstanding $186.0 million of growth in average total earning assets. The Company’s total cost of funds was 2.51% for the third quarter of 2026, an increase of 1 basis point compared to the second quarter of 2026, and a decrease of 28 basis points compared to the third quarter of 2025. Deposit costs were 2.48% for the third quarter of 2026, similar to 2.48% for the second quarter of 2026, and compared to 2.72% for the third quarter of 2025, a decrease of 24 basis points from the third quarter of 2025. The cost of interest-bearing deposits increased 2 basis points during the third quarter of 2026 to 2.97%, compared with 2.95% in the second quarter of 2026, reflecting continued repricing of our interest-bearing deposits to align with competitive rate pressure associated with the markets expectation of the Federal Reserve hiking rates during the third quarter of 2026. Noninterest income totaled $3.3 million for the third quarter of 2026, an increase of $1.1 million, or 51.2%, from the second quarter of 2026, primarily attributable to an increase in gain on sale of government guaranteed loans by $1.3 million; offset by a net decrease in other categories within noninterest income. Noninterest expense totaled $13.7 million for the third quarter of 2026, an increase of $336 thousand, or 2.5%, from the second quarter of 2026. This increase was primarily due to higher salaries and employee benefits of $299 thousand, coupled with a net increase in other noninterest expense categories. The Company continues to focus on organic growth and expansion through banker recruiting across the franchise. The Company’s effective tax rate for the third quarter of 2026 was 24.2%, compared to 17.0% for the second quarter of 2026, and 23.2% for the third quarter of 2025. The increase in effective tax rate from the second quarter of 2026 was primarily due to a reduction in the deferred tax asset related to state taxes during the third quarter of 2026 of approximately $641 thousand. Excluding discrete items related to this write-down and stock based compensation activity, the Company's effective tax rate at the end of the third quarter of 2026 was 20.05%. Balance Sheet Trends Total assets were $2.42 billion at September 30, 2026, an increase of approximately $117.2 million, or 5.1%, from $2.31 billion at December 31, 2025. LHFS were $142.4 million at September 30, 2026, a decrease of $28.5 million, or 16.7%, from $170.9 million at December 31, 2025. Gross LHFI were $1.79 billion at September 30, 2026, an increase of approximately $169.6 million, or 10.5%, from $1.62 billion at December 31, 2025. Total deposits were $2.10 billion at September 30, 2026, an increase of $113.1 million, or 5.7%, from $1.99 billion at December 31, 2025. Noninterest-bearing deposits were $340.4 million at September 30, 2026, or 16.2% of total deposits, compared to $312.3 million, or 15.7% of total deposits, at December 31, 2025. Brokered certificates of deposit, a component of time deposits, were $257.0 million at September 30, 2026, as compared to $307.0 million at December 31, 2025, a decrease of $50.0 million, or 16.3%. Credit Quality During the third quarter of 2026, the Company recorded a recovery for credit losses of $429 thousand, compared to a provision for credit losses of $658 thousand and $653 thousand during the second quarter of 2026 and the third quarter of 2025, respectively. The recovery for credit losses recorded during the third quarter of 2026 was due to changes in the economic forecast and loan mix, offset by new loan production. The Company's annualized net charge-offs to average LHFI ratio was 0.01% for the third quarter of 2026 as compared to 0.01% and 0.03% during the second quarter of 2026 and the third quarter of 2025, respectively. Nonperforming assets totaled $15.1 million, or 0.62% of total assets, at September 30, 2026 compared to $18.3 million, or 0.79% of total assets at December 31, 2025. The decrease in nonperforming loans was primarily due to a $4.2 million paydown of one nonaccrual senior housing loan, offset by modest additions to nonaccrual loans. Adjusted nonperforming assets3, which excludes the guaranteed portions of nonaccrual loans, was $10.9 million, or 0.45% of total assets, at September 30, 2026 compared to $14.2 million, or 0.62% of total assets, at December 31, 2025.
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3 About CoastalSouth Bancshares, Inc. CoastalSouth Bancshares, Inc. is a bank holding company headquartered in Atlanta, Georgia. Through our wholly owned subsidiary, Coastal States Bank, a South Carolina state-chartered commercial bank, we offer a full range of banking products and services designed for businesses, real estate professionals, and consumers looking for a deep and meaningful relationship with their bank. To learn more about Coastal States Bank, visit www.coastalstatesbank.com. Contacts Stephen R. Stone Anthony P. ValdugaPresident and Chief Executive Officer Chief Financial Officer / Chief Operating Officer678-396-4605investorrelations@coastalstatesbank.com Forward-Looking Statements Statements in this press release regarding future events and our expectations and beliefs about our future financial performance and financial condition, as well as trends in our business and markets, constitute “forward-looking statements” within the meaning of, and subject to the protections of, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are not historical in nature and may be identified by references to a future period or periods by the use of the words “believe,” “expect,” “anticipate,” “intend,” “plan,” “estimate,” “project,” “outlook,” or words of similar meaning, or future or conditional verbs such as “will,” “would,” “should,” “could,” or “may.” The forward-looking statements in this press release should not be relied on because they are based on current information and on assumptions that we make about future events and circumstances that are subject to a number of known and unknown risks and uncertainties that are often difficult to predict and beyond our control. As a result of those risks and uncertainties, and other factors, our actual financial results in the future could differ, possibly materially, from those expressed in or implied by the forward-looking statements contained in this press release and could cause us to make changes to our future plans. Factors that might cause such differences include, but are not limited to: the impact of current and future economic conditions, particularly those affecting the financial services industry, including the effects of declines in the real estate market, high unemployment rates, inflationary pressures, elevated interest rates and slowdowns in economic growth, as well as the financial stress on borrowers as a result of the foregoing; potential impacts of any adverse developments in the banking industry, including any impacts on customer confidence, deposit outflows, liquidity and the regulatory response thereto; changes in the interest rate environment, including changes to the federal funds rate; changes in prices, values and sales volumes of residential and commercial real estate; competition in our markets that may result in increased funding costs or reduced earning assets yields, thus reducing margins and net interest income; interest rate fluctuations, which could have an adverse effect on the Company’s profitability; a breach in security of our information systems, including the occurrence of cyber-attack incidents or deficiencies in cyber security; risks related to potential acquisitions; government actions or inactions, including a prolonged shutdown of the federal government, tariffs, or trade wars (including reduced consumer spending, lower economic growth or recession, reduced demand for U.S. exports, disruptions to supply chains, and decreased demand for other banking products and services), legislation or regulatory changes which could adversely affect the ability of the consolidated Company to conduct business combinations or new operations; changes in tax laws; significant turbulence or a disruption in the capital or financial markets and the effect of a fall in stock market prices on our investment securities; the effects of war or other conflicts, domestic civil unrest and tyranny, and changes in the overall geopolitical landscape; and adverse results from current or future litigation, regulatory examinations or other legal and/or regulatory actions, including as a result of the Company’s participation in and execution of government programs. Therefore, the Company can give no assurance that the results contemplated in the forward-looking statements will be realized. Additional information regarding these and other risks and uncertainties to which our business and future financial performance are subject is contained in the section titled “Cautionary Note Regarding Forward-Looking Statements” and “Risk Factors” in the Company’s 2025 Annual Report on Form 10-K under the Securities Exchange Act of 1934, as amended, filed with the Securities and Exchange Commission (the “SEC”) on March 12, 2026, and in other documents that we file with the SEC from time to time, which are available on the SEC’s website, http://www.sec.gov. In addition, our actual financial results in the future may differ from those currently expected due to additional risks and uncertainties of which we are not currently aware or which we do not currently view as, but in the future may become, material to our business or operating results. Due to these and other possible uncertainties and risks, readers are cautioned not to place undue reliance on the forward-looking statements contained in this press release or to make predictions based solely on historical financial performance. Any forward-looking statement speaks only as of the date on which it is made, and we do not undertake any obligation to update or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except as required by law. All forward-looking statements, express or implied, included in this press release are qualified in their entirety by this cautionary statement.
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COASTALSOUTH BANCSHARES, INC. AND SUBSIDIARYFINANCIAL TABLES 4 Financial Highlights (unaudited) Table 1A As of and for the Three Months Ended As of and for the Nine Months Ended (dollars in thousands except September 30, June 30, March 31, December 31, September 30, September 30, September 30, per share amounts) 2026 2026 2026 2025 2025 2026 2025 Selected Operating Data: Interest income $ 34,878 $ 33,558 $ 32,568 $ 33,006 $ 32,890 $ 101,004 $ 94,707 Interest expense 13,351 12,893 12,824 13,143 13,700 39,068 40,680 Net interest income 21,527 20,665 19,744 19,863 19,190 61,936 54,027 (Recovery) provision for credit losses (429) 658 382 1,162 653 611 2,034 Noninterest income 3,329 2,202 1,967 2,295 2,100 7,498 5,776 Noninterest expense 13,710 13,374 13,044 12,262 11,856 40,128 35,367 Income tax expense 2,803 1,502 1,956 1,598 2,040 6,261 4,646 Net income 8,772 7,333 6,329 7,136 6,741 22,434 17,756 Share and Per Share Data: Basic earnings per share $ 0.73 $ 0.61 $ 0.53 $ 0.60 $ 0.57 $ 1.87 $ 1.64 Diluted earnings per share $ 0.71 $ 0.59 $ 0.51 $ 0.58 $ 0.54 $ 1.81 $ 1.58 Dividends per share $ 0.05 $ 0.05 $ 0.05 $ n/a $ n/a $ 0.15 $ n/a Book value per share $ 22.32 $ 22.47 $ 21.94 $ 21.66 $ 20.91 $ 22.32 $ 20.91 Tangible book value per common share $ 21.90 $ 22.06 $ 21.52 $ 21.25 $ 20.49 $ 21.90 $ 20.49 Shares of common stock outstanding 11,734,134 12,003,040 11,985,414 11,980,412 11,978,921 11,734,134 11,978,921 Weighted average diluted shares outstanding 12,371,522 12,447,791 12,440,809 12,387,619 12,325,462 12,421,421 11,217,972 Selected Balance Sheet Data: Total assets $ 2,423,766 $ 2,420,993 $ 2,348,547 $ 2,306,586 $ 2,255,389 $ 2,423,766 $ 2,255,389 Securities available-for-sale, at fair value 332,664 348,582 347,533 330,503 334,955 332,664 334,955 Gross loans held for investment 1,786,923 1,705,370 1,627,261 1,617,315 1,552,976 1,786,923 1,552,976 Loans held for sale 142,399 223,112 202,615 170,933 231,593 142,399 231,593 Allowance for credit losses 19,623 19,817 18,826 18,743 18,028 19,623 18,028 Goodwill and other intangible assets 6,307 6,246 6,243 6,262 6,186 6,307 6,186 Total deposits 2,100,746 2,047,671 2,057,144 1,987,684 1,949,672 2,100,746 1,949,672 Core deposits 1,773,730 1,793,743 1,798,553 1,680,650 1,654,764 1,773,730 1,654,764 Other borrowings 30,000 75,000 - 30,000 25,000 30,000 25,000 Total shareholders' equity 261,920 269,703 262,923 259,529 250,438 261,920 250,438 (1) Considered non-GAAP financial measure - See "Non-GAAP Financial Measures” and reconciliation of GAAP to non-GAAP financial measures in tables 10A - 10E. (2) The Company did not have securities held to maturity in any of the periods presented. (1) (2) (1)
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COASTALSOUTH BANCSHARES, INC. AND SUBSIDIARYFINANCIAL TABLES 5 Financial Highlights - continued (unaudited) Table 1B As of and for the Three Months Ended As of and for the Nine Months Ended September 30, June 30, March 31, December 31, September 30, September 30, September 30, (dollars in thousands) 2026 2026 2026 2025 2025 2026 2025 Performance Ratios: Pre-tax, pre-provision net revenue (PPNR) $ 11,146 $ 9,493 $ 8,667 $ 9,896 $ 9,434 $ 29,306 $ 24,436 Return on average assets (ROAA) 1.45 % 1.24 % 1.10 % 1.24 % 1.20 % 1.27 % 1.09 %Return on average equity 12.88 11.02 9.71 11.02 10.84 11.23 10.91 Return on average tangible common equity (ROATCE) 13.12 11.23 9.90 11.24 11.07 11.44 11.17 Dividend payout ratio 6.92 8.33 9.69 n/a n/a 8.16 n/a Net interest rate spread 2.99 2.97 2.90 2.87 2.83 2.95 2.76 Net interest margin 3.70 3.66 3.59 3.60 3.58 3.65 3.48 Efficiency ratio 55.16 58.49 60.08 55.34 55.69 57.79 59.14 Noninterest income to average total assets 0.55 0.37 0.34 0.40 0.37 0.42 0.35 Noninterest expense to average total assets 2.26 2.27 2.27 2.13 2.11 2.27 2.17 Average interest-earning assets to average interest-bearing liabilities 130.86 130.15 129.61 130.41 129.16 130.22 127.34 Average equity to average total assets 11.22 11.29 11.34 11.22 11.08 11.28 9.99 Asset Quality Data: Net charge-offs to average LHFI 0.01 % 0.01 % 0.01 % 0.00 % 0.03 % 0.01 % 0.03 %Net charge-offs to total average loans 0.01 0.01 0.01 0.00 0.03 0.01 0.03 Total allowance for credit losses to total LHFI 1.10 1.16 1.16 1.16 1.16 1.10 1.16 Total allowance for credit losses to total loans 1.02 1.03 1.03 1.05 1.01 1.02 1.01 Total allowance for credit losses to nonperforming loans 130.13 108.16 103.54 102.39 127.03 130.13 127.03 Nonperforming loans to gross LHFI 0.84 1.07 1.12 1.13 0.91 0.84 0.91 Nonperforming assets to total assets 0.62 0.76 0.77 0.79 0.63 0.62 0.63 Adjusted nonperforming assets to total assets 0.45 0.61 0.62 0.62 0.43 0.45 0.43 Balance Sheet and Capital Ratios: Loan-to-deposit ratio 91.84 % 94.18 % 88.95 % 89.97 % 91.53 % 91.84 % 91.53 %Noninterest-bearing deposits to total deposits 16.21 17.38 15.12 15.71 16.08 16.21 16.08 Total shareholders' equity to total assets 10.81 11.14 11.20 11.25 11.10 10.81 11.10 Tangible common equity to tangible assets 10.63 10.96 11.01 11.06 10.91 10.63 10.91 Tier 1 leverage ratio 11.07 11.12 11.21 11.18 11.15 11.07 11.15 Common equity tier 1 ratio 12.30 12.30 12.19 12.30 11.94 12.30 11.94 Tier 1 risk-based capital ratio 12.30 12.30 12.19 12.30 11.94 12.30 11.94 Total risk-based capital ratio 13.36 13.39 13.25 13.31 12.90 13.36 12.90 Other: Number of branches 12 11 11 11 11 12 11 Number of full-time equivalent employees 210 201 201 196 194 207 187 (1) Considered non-GAAP financial measure - See "Non-GAAP Financial Measures” and reconciliation of GAAP to non-GAAP financial measures in tables 10A - 10E. (2) Represents annualized data. (3) Ratios are for Coastal States Bank only. Ratios for September 30, 2026 are preliminary. (1) (2) (2) (1)(2) (2) (2) (2) (2) (2) (2) (1) (1) (3) (3) (3) (3)
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COASTALSOUTH BANCSHARES, INC. AND SUBSIDIARYFINANCIAL TABLES 6 Quarter End Balance Sheets (unaudited) Table 2 September 30, June 30, March 31, December 31, September 30, (dollars in thousands) 2026 2026 2026 2025 2025 Assets Cash and due from banks $ 25,443 $ 24,262 $ 22,546 $ 41,538 $ 20,088 Federal funds sold 19,775 9,960 40,011 38,229 6,191 Investment securities 341,590 359,635 355,014 339,262 342,990 Loans held for sale (LHFS) 142,399 223,112 202,615 170,933 231,593 Loans held for investment (LHFI) 1,786,923 1,705,370 1,627,261 1,617,315 1,552,976 Allowance for credit losses on LHFI (19,623) (19,817) (18,826) (18,743) (18,028)Loans held for investment, net 1,767,300 1,685,553 1,608,435 1,598,572 1,534,948 Bank-owned life insurance 49,694 49,218 48,752 48,296 47,833 Premises, furniture and equipment, net 18,378 18,611 18,810 18,122 18,186 Deferred tax asset 17,613 15,740 16,910 16,370 16,262 Goodwill & intangible assets 6,307 6,246 6,243 6,262 6,186 Other assets 35,267 28,656 29,211 29,002 31,112 Total assets $ 2,423,766 $ 2,420,993 $ 2,348,547 $ 2,306,586 $ 2,255,389 Liabilities and shareholders' equity Liabilities Deposits Noninterest-bearing transaction accounts$ 340,427 $ 355,941 $ 311,054 $ 312,251 $ 313,604 Interest-bearing transaction accounts 213,146 194,896 235,422 214,620 198,753 Savings and money market 800,988 772,809 775,962 673,609 634,826 Time deposits 746,185 724,025 734,706 787,204 802,489 Total deposits 2,100,746 2,047,671 2,057,144 1,987,684 1,949,672 Federal Home Loan Bank of Atlanta advances 30,000 75,000 - 30,000 25,000 Other liabilities 31,100 28,619 28,480 29,373 30,279 Total liabilities 2,161,846 2,151,290 2,085,624 2,047,057 2,004,951 Shareholders' equity Voting common stock 11,734 12,003 11,853 10,868 10,449 Nonvoting common stock - - 132 1,112 1,530 Capital surplus 181,518 188,851 190,160 189,882 189,654 Accumulated income 87,489 79,324 72,602 66,886 59,750 Accumulated other comprehensive loss (18,821) (10,475) (11,824) (9,219) (10,945)Total shareholders' equity 261,920 269,703 262,923 259,529 250,438 Total liabilities and shareholders' equity$ 2,423,766 $ 2,420,993 $ 2,348,547 $ 2,306,586 $ 2,255,389 (1) No ACL on investment securities was recognized for the periods presented; includes securities available-for-sale and non-marketable equity securities. (2) Includes commercial mortgage servicing rights of approximately $1.4 million, $1.3 million, $1.3 million, $1.3 million, and $1.2 million at September 30, 2026, June 30, 2026, March 31, 2026, December 31, 2025 and September 30, 2025, respectively. (1) (2)
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COASTALSOUTH BANCSHARES, INC. AND SUBSIDIARYFINANCIAL TABLES 7 Statements of Operations (unaudited) Table 3 Three Months Ended Nine Months Ended September 30, June 30, March 31, December 31, September 30, September 30, September 30, (dollars in thousands) 2026 2026 2026 2025 2025 2026 2025 Interest income Interest on cash and due from banks $ 132 $ 121 $ 125 $ 109 $ 129 $ 378 $ 375 Interest on federal funds sold 486 409 792 624 616 1,687 2,277 Interest and dividends on investment securities 4,066 3,892 3,611 3,734 4,125 11,569 11,800 Interest and fees on LHFS 2,781 3,162 2,915 3,771 3,422 8,858 9,537 Interest and fees on LHFI 27,413 25,974 25,125 24,768 24,598 78,512 70,718 Total interest income 34,878 33,558 32,568 33,006 32,890 101,004 94,707 Interest expense Deposits 12,835 12,545 12,592 12,925 13,274 37,972 39,355 Other borrowings 516 348 232 218 426 1,096 1,325 Total interest expense 13,351 12,893 12,824 13,143 13,700 39,068 40,680 Net interest income 21,527 20,665 19,744 19,863 19,190 61,936 54,027 (Recovery) provision for credit losses (429) 658 382 1,162 653 611 2,034 Net interest income after provision for credit losses 21,956 20,007 19,362 18,701 18,537 61,325 51,993 Noninterest income Mortgage banking related income 375 403 394 330 299 1,172 846 Interchange and card fee income 244 256 273 230 238 773 761 Service charges on deposit accounts 268 236 232 256 208 736 634 Bank-owned life insurance 476 466 456 462 461 1,398 1,349 Gain on sale of government guaranteed loans 1,558 307 337 682 613 2,202 878 Other noninterest income 408 534 275 335 281 1,217 1,308 Total noninterest income 3,329 2,202 1,967 2,295 2,100 7,498 5,776 Noninterest expense Salaries and employee benefits 8,613 8,314 8,046 7,644 6,985 24,973 20,676 Occupancy and equipment 944 875 886 864 850 2,705 2,452 Data processing 560 682 655 640 647 1,897 1,924 Other professional services 503 632 595 391 571 1,730 2,237 Software and other technology expense 894 861 826 808 788 2,581 2,210 Regulatory assessment 353 308 371 369 419 1,032 1,124 Other noninterest expense 1,843 1,702 1,665 1,546 1,596 5,210 4,744 Total noninterest expense 13,710 13,374 13,044 12,262 11,856 40,128 35,367 Net income before taxes 11,575 8,835 8,285 8,734 8,781 28,695 22,402 Income tax expense 2,803 1,502 1,956 1,598 2,040 6,261 4,646 Net income $ 8,772 $ 7,333 $ 6,329 $ 7,136 $ 6,741 $ 22,434 $ 17,756
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COASTALSOUTH BANCSHARES, INC. AND SUBSIDIARYFINANCIAL TABLES 8 QTD Average Balances and Yields/Rates (unaudited) Table 4 Three Months Ended September 30, 2026 June 30, 2026 September 30, 2025 Average Yield/ Average Yield/ Average Yield/ (dollars in thousands) Balance Interest Rate Balance Interest Rate Balance Interest Rate Earning assets: Cash and due from banks $ 23,841 $ 132 2.20% $ 23,889 $ 121 2.03% $ 21,058 $ 129 2.43%Federal funds sold 51,509 486 3.74% 44,172 409 3.71% 52,240 616 4.68%Investment securities 356,044 4,066 4.53% 358,658 3,892 4.35% 339,619 4,125 4.82%Loans held for sale 145,169 2,781 7.60% 170,135 3,162 7.45% 167,424 3,422 8.11%Loans held for investment 1,733,109 27,413 6.28% 1,668,045 25,974 6.25% 1,543,363 24,598 6.32%Total earning assets 2,309,672 34,878 5.99% 2,264,899 33,558 5.94% 2,123,704 32,890 6.14% Noninterest-earning assets: Allowance for credit losses on LHFI (19,815) (18,834) (17,504) Bank-owned life insurance 49,414 48,944 47,569 Premises, furniture and equipment, net 18,538 18,760 18,241 Deferred tax asset 16,226 16,702 17,159 Goodwill & intangible assets 6,235 6,229 6,176 Other assets 27,919 27,734 30,633 Total noninterest-earning assets 98,517 99,535 102,274 Total assets $ 2,408,189 $ 2,364,434 $ 2,225,978 Interest-bearing liabilities: Interest-bearing deposits $ 1,712,756 $ 12,835 2.97% $ 1,704,027 $ 12,545 2.95% $ 1,631,767 $ 13,274 3.23%Federal Home Loan Bank of Atlanta advances 52,175 516 3.92% 36,209 348 3.85% 272 3 4.38%Subordinated debt, net - - 0.00% - - 0.00% 12,191 423 13.77%Total interest-bearing liabilities 1,764,931 13,351 3.00% 1,740,236 12,893 2.97% 1,644,230 13,700 3.31%Noninterest-bearing liabilities: Noninterest-bearing deposits 343,110 328,644 306,133 Other liabilities 29,996 28,580 28,927 Total noninterest-bearing liabilities 373,106 357,224 335,060 Shareholders' equity 270,152 266,974 246,688 Total liabilities and shareholders' equity $ 2,408,189 $ 2,364,434 $ 2,225,978 Net interest income $ 21,527 $ 20,665 $ 19,190 Net interest spread 2.99% 2.97% 2.83%Net interest margin 3.70% 3.66% 3.58% Cost of total deposits 2.48% 2.48% 2.72%Cost of total funding 2.51% 2.50% 2.79% (1) Includes noninterest-bearing deposits. (1) (1)
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COASTALSOUTH BANCSHARES, INC. AND SUBSIDIARYFINANCIAL TABLES 9 YTD Average Balances and Yields/Rates (unaudited) Table 5 Nine Months Ended September 30, 2026 September 30, 2025 Average Yield/ Average Yield/ (dollars in thousands) Balance Interest Rate Balance Interest Rate Earning assets: Cash and due from banks $ 24,180 $ 378 2.09% $ 21,509 $ 375 2.33%Federal funds sold 60,421 1,687 3.73% 67,659 2,277 4.50%Investment securities 352,870 11,569 4.38% 337,852 11,800 4.67%Loans held for sale 157,918 8,858 7.50% 157,409 9,537 8.10%Loans held for investment 1,673,572 78,512 6.27% 1,493,081 70,718 6.33%Total earning assets 2,268,961 101,004 5.95% 2,077,510 94,707 6.09% Noninterest-earning assets: Allowance for credit losses on LHFI (19,136) (17,245) Bank-owned life insurance 48,952 47,123 Premises, furniture and equipment, net 18,586 18,044 Deferred tax asset 16,367 17,379 Goodwill & intangible assets 6,245 6,224 Other assets 27,641 29,935 Total noninterest-earning assets 98,655 101,460 Total assets $ 2,367,616 $ 2,178,970 Interest-bearing liabilities: Interest-bearing deposits $ 1,704,661 $ 37,972 2.98% $ 1,608,583 $ 39,355 3.27%Federal funds purchased - - 0.00% 13 1 10.28%Federal Home Loan Bank of Atlanta advances 37,784 1,096 3.88% 3,809 131 4.60%Revolving commercial line of credit, net - - 0.00% 5,141 300 7.80%Subordinated debt, net - - 0.00% 13,882 893 8.60%Total interest-bearing liabilities 1,742,445 39,068 3.00% 1,631,428 40,680 3.33%Noninterest-bearing liabilities: Noninterest-bearing deposits 329,028 301,997 Other liabilities 29,002 27,944 Total noninterest-bearing liabilities 358,030 329,941 Shareholders' equity 267,141 217,601 Total liabilities and shareholders' equity $ 2,367,616 $ 2,178,970 Net interest income $ 61,936 $ 54,027 Net interest spread 2.95% 2.76%Net interest margin 3.65% 3.48% Cost of total deposits 2.50% 2.75%Cost of total funding 2.52% 2.81% (1) Includes noninterest-bearing deposits. (1) (1)
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COASTALSOUTH BANCSHARES, INC. AND SUBSIDIARYFINANCIAL TABLES 10 Loan Data (unaudited) Table 6 As of the Quarter Ended September 30, 2026 June 30, 2026 March 31, 2026 December 31, 2025 September 30, 2025 (dollars in thousands) Amount % of Total Amount % of Total Amount % of Total Amount % of Total Amount % of Total Loans held for investment ("LHFI"): Commercial Loans Acquisition, development and construction $ 134,395 7.5% $ 144,436 8.5% $ 130,398 8.0% $ 119,352 7.4% $ 106,787 6.9%Income producing commercial real estate ("CRE") 449,103 25.1 416,965 24.5 376,260 23.1 378,179 23.4 371,670 23.9 Owner-occupied CRE 140,420 7.9 127,285 7.5 107,344 6.6 92,787 5.7 96,287 6.2 Senior housing 308,295 17.3 248,282 14.5 254,445 15.6 259,529 16.0 223,719 14.4 Commercial and industrial 113,656 6.4 139,313 8.1 138,964 8.6 145,380 9.0 135,039 8.7 Retail Loans Marine vessels 320,682 17.9 313,230 18.4 307,746 18.9 312,096 19.3 318,246 20.5 Residential mortgages 203,476 11.4 202,768 11.9 202,503 12.5 199,991 12.4 190,220 12.2 Cash value life insurance line of credit ("LOC") 93,210 5.2 89,305 5.2 86,610 5.3 87,172 5.4 90,115 5.8 Other consumer 23,686 1.3 23,786 1.4 22,991 1.4 22,829 1.4 20,893 1.4 Gross loans held for investment $ 1,786,923 100.0% $ 1,705,370 100.0% $ 1,627,261 100.0% $ 1,617,315 100.0% $ 1,552,976 100.0%Core LHFI 1,743,128 1,657,581 1,573,972 1,561,791 1,492,992 Acquired LHFI 43,795 47,789 53,289 55,524 59,984 Gross loans held for investment $ 1,786,923 $ 1,705,370 $ 1,627,261 $ 1,617,315 $ 1,552,976 Allowance for credit losses on LHFI 19,623 19,817 18,826 18,743 18,028 Net loans held for investment $ 1,767,300 $ 1,685,553 $ 1,608,435 $ 1,598,572 $ 1,534,948 Total loans held-for-sale 142,399 223,112 202,615 170,933 231,593 Total loans $ 1,929,322 $ 1,928,482 $ 1,829,876 $ 1,788,248 $ 1,784,569 (1) Includes loans acquired through business combinations. Nonperforming Assets (unaudited) Table 7 As of the Quarter Ended (dollars in thousands) September 30, 2026 June 30, 2026 March 31, 2026 December 31, 2025 September 30, 2025 Nonaccrual loans $ 15,055 $ 18,322 $ 18,183 $ 18,306 $ 14,171 Past due loans 90 days and still accruing 25 - - - 21 Total nonperforming loans $ 15,080 $ 18,322 $ 18,183 $ 18,306 $ 14,192 Other real estate owned - - - - - Total nonperforming assets $ 15,080 $ 18,322 $ 18,183 $ 18,306 $ 14,192 Nonperforming loans to gross LHFI 0.84% 1.07% 1.12% 1.13% 0.91% Nonaccrual loans to total assets 0.62% 0.76% 0.77% 0.79% 0.63% Nonperforming assets to total assets 0.62% 0.76% 0.77% 0.79% 0.63% (1)
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COASTALSOUTH BANCSHARES, INC. AND SUBSIDIARYFINANCIAL TABLES 11 Allowance for Credit Losses (unaudited) Table 8 As of and for the Three Months Ended As of and for the Nine Months Ended September 30, June 30, March 31, December 31, September 30, September 30, September 30, (dollars in thousands) 2026 2026 2026 2025 2025 2026 2025 Allowance for credit losses on LHFI Balance, beginning of period $ 19,817 $ 18,826 $ 18,743 $ 18,028 $ 17,497 $ 18,743 $ 17,118 Net charge-offs/(recoveries): Commercial Loans Acquisition, development and construction - - - - - - - Income producing CRE - - - - - - - Owner-occupied CRE - - - - - - - Senior housing - - - - - - - Commercial and industrial (5) 4 (6) (4) (29) (7) (9)Retail Loans Marine vessels - 27 - - 162 27 162 Residential mortgages (1) (2) - (29) (2) (3) (6)Cash value life insurance LOC - - - - - - - Other consumer 35 (4) 47 20 (6) 78 201 Total net charge-offs/(recoveries) $ 29 $ 25 $ 41 $ (13) $ 125 $ 95 $ 348 (Recovery) provision for loan credit losses (165) 1,016 124 702 656 975 1,258 Balance, ending of period $ 19,623 $ 19,817 $ 18,826 $ 18,743 $ 18,028 $ 19,623 $ 18,028 Allowance for credit losses for unfunded commitments Period beginning balance $ 3,856 $ 4,214 $ 3,956 $ 3,496 $ 3,499 $ 3,956 $ 2,720 (Recovery) provision for credit losses (264) (358) 258 460 (3) (364) 776 Period ending balance $ 3,592 $ 3,856 $ 4,214 $ 3,956 $ 3,496 $ 3,592 $ 3,496 Balance, end of period - Allowance for credit losses: LHFI and unfunded commitments $ 23,215 $ 23,673 $ 23,040 $ 22,699 $ 21,524 $ 23,215 $ 21,524 Total loans held for investment $ 1,786,923 $ 1,705,370 $ 1,627,261 $ 1,617,315 $ 1,552,976 $ 1,786,923 $ 1,552,976 Credit Analysis Net charge-offs to average LHFI 0.01% 0.01% 0.01 % 0.00 % 0.03 % 0.01% 0.03%Total allowance for credit losses on LHFI to total LHFI 1.10% 1.16% 1.16% 1.16% 1.16% 1.10% 1.16%Total allowance for credit losses on LHFI to nonaccrual loans 130.34% 108.16% 103.54% 102.39% 127.22% 130.34% 127.22%Total allowance for credit losses on LHFI to total nonperforming loans 130.13% 108.16% 103.54% 102.39% 127.03% 130.13% 127.03%
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COASTALSOUTH BANCSHARES, INC. AND SUBSIDIARYFINANCIAL TABLES 12 Loan Risk Ratings (unaudited) Table 9 As of the Quarter Ended (dollars in thousands) September 30, 2026 June 30, 2026 March 31, 2026 December 31, 2025 September 30, 2025 Acquisition, development and construction Pass $ 134,395 $ 144,436 $ 130,398 $ 119,352 $ 106,787 Special mention - - - - - Substandard - - - - - Total acquisition, development and construction $ 134,395 $ 144,436 $ 130,398 $ 119,352 $ 106,787 Income producing CRE Pass $ 448,028 $ 416,501 $ 375,791 $ 377,711 $ 370,788 Special mention - - - - - Substandard 1,075 464 469 468 882 Total income producing CRE$ 449,103 $ 416,965 $ 376,260 $ 378,179 $ 371,670 Owner-occupied CRE Pass $ 129,245 $ 116,429 $ 97,706 $ 82,959 $ 86,533 Special mention 2,461 2,485 2,509 2,739 3,579 Substandard 8,714 8,371 7,129 7,089 6,175 Total owner-occupied CRE$ 140,420 $ 127,285 $ 107,344 $ 92,787 $ 96,287 Senior housing Pass $ 297,434 $ 233,501 $ 239,788 $ 236,816 $ 205,330 Special mention - - 3,940 11,934 12,006 Substandard 10,861 14,781 10,717 10,779 6,383 Total senior housing $ 308,295 $ 248,282 $ 254,445 $ 259,529 $ 223,719 Commercial and industrial Pass $ 109,955 $ 135,851 $ 135,295 $ 141,020 $ 128,468 Special mention - - 141 212 2,402 Substandard 3,701 3,462 3,528 4,148 4,169 Total commercial and industrial$ 113,656 $ 139,313 $ 138,964 $ 145,380 $ 135,039 Marine vessels Performing $ 320,682 $ 313,230 $ 307,746 $ 312,096 $ 318,246 Nonperforming - - - - - Total marine vessels $ 320,682 $ 313,230 $ 307,746 $ 312,096 $ 318,246 Residential mortgages Performing $ 203,088 $ 202,380 $ 202,114 $ 199,601 $ 190,059 Nonperforming 388 388 389 390 161 Total residential mortgages$ 203,476 $ 202,768 $ 202,503 $ 199,991 $ 190,220 Cash value life insurance LOC Performing $ 93,210 $ 89,305 $ 86,610 $ 87,172 $ 90,115 Nonperforming - - - - - Total cash value life insurance LOC $ 93,210 $ 89,305 $ 86,610 $ 87,172 $ 90,115 Other consumer Performing $ 23,661 $ 23,786 $ 22,991 $ 22,829 $ 20,872 Nonperforming 25 - - - 21 Total other consumer $ 23,686 $ 23,786 $ 22,991 $ 22,829 $ 20,893 Gross loans held for investment$ 1,786,923 $ 1,705,370 $ 1,627,261 $ 1,617,315 $ 1,552,976 (1) There were no commercial loans classified as doubtful. (2) Retail loans are classified as either performing or nonperforming. (1) (2) (1) (1) (1) (1) (1) (2) (2) (2) (2)
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13 Non-GAAP Financial Measures The measures entitled return on average tangible common equity, tangible book value per common share, tangible common equity, tangible assets, adjusted nonperforming assets to total assets, adjusted nonperforming assets, pre-tax, pre-provision net revenue ("PPNR"), tangible common equity to tangible assets and core deposits are not measures recognized under accounting principles generally accepted in the United States of America (“GAAP”) and therefore are considered non-GAAP financial measures. The most comparable GAAP measures to these measures are return on average shareholders’ equity, book value per share, total shareholders’ equity, total assets, total nonperforming assets to total assets, total nonperforming assets, net income, total common equity to total assets, and total deposits, respectively. Management believes that these non-GAAP financial measures and the information they provide are useful to investors since these measures permit investors to view the Company’s performance using the same tools that management uses to evaluate the Company’s past performance and prospects for future performance. While management believes that these non-GAAP financial measures are useful in evaluating our performance, this information should be considered as supplemental and not as a substitute for or superior to the related financial information prepared in accordance with GAAP. Additionally, these non-GAAP financial measures should be considered as additional views of the way the Company’s financial measures are affected by significant items and other factors, and since they are not required to be uniformly applied, they may not be comparable to other similarly titled measures at other companies.
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COASTALSOUTH BANCSHARES, INC. AND SUBSIDIARYFINANCIAL TABLES Non-GAAP Reconciliations 14 Tangible Book Value per Common Share / Tangible Common Equity to Tangible Assets (unaudited) Table 10A As of September 30, June 30, March 31, December 31, September 30, (dollars in thousands, except per share data) 2026 2026 2026 2025 2025 Tangible Common Equity: Total shareholders' equity $ 261,920 $ 269,703 $ 262,923 $ 259,529 $ 250,438 Less: Goodwill and intangibles (6,307) (6,246) (6,243) (6,262) (6,186) Adjusted for: Mortgage servicing rights 1,402 1,313 1,280 1,266 1,156 Tangible Common Equity $ 257,015 $ 264,770 $ 257,960 $ 254,533 $ 245,408 Common shares outstanding 11,734,134 12,003,040 11,985,414 11,980,412 11,978,921 Book value per common share 22.32 22.47 21.94 21.66 20.91 Tangible book value per common share 21.90 22.06 21.52 21.25 20.49 Tangible assets: Total assets $ 2,423,766 $ 2,420,993 $ 2,348,547 $ 2,306,586 $ 2,255,389 Less: Goodwill and intangibles (6,307) (6,246) (6,243) (6,262) (6,186) Adjusted for: Mortgage servicing rights 1,402 1,313 1,280 1,266 1,156 Tangible assets $ 2,418,861 $ 2,416,060 $ 2,343,584 $ 2,301,590 $ 2,250,359 Tangible common equity to tangible assets 10.63% 10.96% 11.01% 11.06% 10.91% ROATCE (unaudited) Table 10B As of and for the Three Months Ended As of and for the Nine Months Ended September 30, June 30, March 31, December 31, September 30, September 30, September 30, (dollars in thousands) 2026 2026 2026 2025 2025 2026 2025 Net income $ 8,772 $ 7,333 $ 6,329 $ 7,136 $ 6,741 $ 22,434 $ 17,756 Average shareholders' equity 270,152 266,974 264,232 256,814 246,688 267,141 217,601 Return on average shareholders' equity 12.88% 11.02% 9.71% 11.02% 10.84% 11.23% 10.91%Average Tangible Common Equity: Average shareholders' equity $ 270,152 $ 266,974 $ 264,232 $ 256,814 $ 246,688 $ 267,141 $ 217,601 Less: Average goodwill and intangibles (6,235) (6,229) (6,270) (6,166) (6,176) (6,245) (6,224) Adjusted for: Average mortgage servicing rights 1,315 1,281 1,291 1,155 1,128 1,296 1,136 Average tangible common equity $ 265,232 $ 262,026 $ 259,253 $ 251,803 $ 241,640 $ 262,192 $ 212,513 Return on average tangible common equity 13.12% 11.23% 9.90% 11.24% 11.07% 11.44% 11.17% (1) Represents annualized data. Adjusted Nonperforming Assets to Total Assets (unaudited) Table 10C As of September 30, June 30, March 31, December 31, September 30, (dollars in thousands) 2026 2026 2026 2025 2025 Total nonperforming assets $ 15,080 $ 18,322 $ 18,183 $ 18,306 $ 14,192 Total assets 2,423,766 2,420,993 2,348,547 2,306,586 2,255,389 GAAP-based nonperforming assets to total assets 0.62% 0.76% 0.77% 0.79% 0.63%Total nonperforming assets $ 15,080 $ 18,322 $ 18,183 $ 18,306 $ 14,192 Adjusted for: Guaranteed portions of nonaccrual loans (4,217) (3,542) (3,657) (4,089) (4,457)Adjusted nonperforming assets $ 10,863 $ 14,780 $ 14,526 $ 14,217 $ 9,735 Total assets $ 2,423,766 $ 2,420,993 $ 2,348,547 $ 2,306,586 $ 2,255,389 Adjusted nonperforming assets to total assets 0.45% 0.61% 0.62% 0.62% 0.43% (1) (1)
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COASTALSOUTH BANCSHARES, INC. AND SUBSIDIARYFINANCIAL TABLES Non-GAAP Reconciliations 15 PPNR (unaudited) Table 10D As of and for the Three Months Ended As of and for the Nine Months Ended September 30, June 30, March 31, December 31, September 30, September 30, September 30, (dollars in thousands) 2026 2026 2026 2025 2025 2026 2025 Net income (GAAP-based) $ 8,772 $ 7,333 $ 6,329 $ 7,136 $ 6,741 $ 22,434 $ 17,756 Plus: Income tax expense 2,803 1,502 1,956 1,598 2,040 6,261 4,646 (Recovery) provision for credit losses (429) 658 382 1,162 653 611 2,034 Pre-tax, pre-provision net revenue $ 11,146 $ 9,493 $ 8,667 $ 9,896 $ 9,434 $ 29,306 $ 24,436 Core Deposits (unaudited) Table 10E As of September 30, June 30, March 31, December 31, September 30, (dollars in thousands) 2026 2026 2026 2025 2025 Total Deposits $ 2,100,746 $ 2,047,671 $ 2,057,144 $ 1,987,684 $ 1,949,672 Less: Brokered CDs 257,016 253,928 258,591 307,034 294,908 ICS money market One-Way Buy 70,000 - - - - Core deposits $ 1,773,730 $ 1,793,743 $ 1,798,553 $ 1,680,650 $ 1,654,764 (1) The Company defines its core deposits as total deposits, less brokered certificates of deposit and IntraFi Cash Service ("ICS") One-Way Buy demand and money market deposits. (1)