UBS Retained Buy Recommendation on SouthState Bank (SSB)
SouthState Bank Corporation (NYSE:SSB) is one of the 10 Best Bank Stocks to Buy in 2026..
On February 4, UBS slightly increased its target price on SouthState Bank (SSB) to $121 (from $120) and reiterated its Buy recommendation. The firm liked what it saw in the 4th quarter of 2025 from mid-cap banks, which delivered strong overall results and avoided asset quality deterioration in Q4. It also expects investor momentum on regional banks to remain strong, due to yield curve steepening, loan growth acceleration, and increased M&A activity.
The bank released its Q4 2025 results on January 22, which showed strong net income growth of 71.8% YoY to $247.7 million (from $144.2 million). On a per share basis, diluted earnings grew 31.6% YoY to $2.46 (from $1.87). The strong earnings growth yielded a 24-basis point improvement in return on average assets (from 1.23% to 1.47%) and a 178-basis point increase in return on common equity (from 9.72% to 10.90%). It also led to an 18.4% YoY growth in book value per share, from $77.18 to $91.38.
Strong earnings growth was driven primarily by a 57.2% YoY increase in net interest income (NII) to $581.1 million (from $369.8 million), which in turn was driven by both net interest margin (NIM) expansion and strong growth in the bank’s earning assets. NIMs expanded by 38 basis points YoY to 3.86% (from 3.48%), as average earning asset yields improved 46 basis points YoY to 5.62% (from 5.16%). This yield improvement outweighed the 9-basis point increase in the bank’s average cost of funding.
Earning assets grew 41.5% YoY to $59.9 billion (from $42.3 billion), with most of the growth coming from a 43.0% expansion in the bank’s loan book (from $33.8 billion to $48.4 billion). This $17.6 billion increase in earnings assets was mostly funded by a $17.1 billion YoY increase in deposits (from $38.1 billion to $55.1 billion), the rest by equity.
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Asset quality, meanwhile, did not materially deteriorate in Q4. Net charge-off ratio slightly increased by 3 basis points YoY to 0.09% (from 0.06%) and improved by 18 basis points when viewed quarter-on-quarter. Non-performing loan %-age increased 1 basis point YoY to 0.64% (from 0.63%). Allowance for credit loss %-age improved 17 basis points YoY to 1.20% (from 1.37%). As a result, provisions for credit losses only grew 3.6% YoY to $6.6 million (from $6.4 million).
SSB’s board of directors also approved a new stock purchase plan, which would allow the bank to repurchase 5.56 million of its common shares. This figure represents roughly 5.6% of the company’s weighted average common shares outstanding as of 31 December 2025.
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