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Introduction & Market Context
Southern States Bancshares , Inc. (NASDAQ:SSBK) released its Q1 2025 investor presentation on April 22, highlighting both strong quarterly performance and details of its recently announced merger with FB Financial Corporation (NYSE:FBK). The Alabama-based community bank, which went public in August 2021, continues to demonstrate solid growth across key metrics while preparing for a significant corporate transformation.
The bank’s stock closed at $32.02 on April 22, up 3.06% for the day, reflecting positive market reception to the quarterly results. With operations across Alabama and Georgia, Southern States has positioned itself as a dominant player in smaller markets while maintaining a competitive presence in larger metropolitan areas like Atlanta and Birmingham.
Merger Details
On March 31, 2025, Southern States Bancshares entered into a definitive merger agreement with FB Financial, marking a pivotal moment in the company’s growth strategy. According to the presentation, Southern States shareholders will receive 0.800 shares of FB Financial common stock for each share of Southern States stock.
Based on FB Financial’s closing stock price of $47.05 per share as of March 28, 2025, the implied transaction value is approximately $37.64 per Southern States share, representing a premium of about 17.5% over the current trading price. The aggregate transaction value is estimated at $381 million.
As shown in the following slide detailing the merger announcement:
The merger is expected to close in late Q3 or early Q4 2025, with the combined entity positioned to leverage enhanced market presence and financial strength. The presentation emphasized that the merger will create a stronger regional banking institution with expanded capabilities across the Southeast.
Quarterly Performance Highlights
Southern States reported impressive financial results for Q1 2025, continuing its trajectory of consistent growth. The bank’s assets reached $2.9 billion, representing a 0.4% quarterly increase and a significant year-over-year expansion from $2.5 billion in Q1 2024.
Core net income for Q1 2025 was $10.3 million, up from $8.1 million in the same quarter last year, while diluted earnings per share increased to $1.03 from $0.90 year-over-year. The bank’s profitability metrics also improved, with core return on average assets (ROAA) rising to 1.47% from 1.34% in Q1 2024.
The comprehensive quarterly financial performance is illustrated in this detailed table:
Net interest margin (NIM), a critical metric for banking profitability, improved to 3.75% in Q1 2025 from 3.59% in Q1 2024, despite the challenging interest rate environment. This improvement was driven by a reduction in funding costs, with the cost of funds decreasing to 2.93% from 3.27% a year earlier, even as the yield on loans slightly decreased to 6.93% from 7.06%.
As shown in the following chart detailing net interest income and margin trends:
The bank maintained strong operational efficiency, with the core efficiency ratio improving slightly to 46.42% in Q1 2025 from 46.90% in Q1 2024, indicating effective cost management despite inflationary pressures.
Balance Sheet and Asset Quality
Southern States reported gross loans of $2.3 billion as of Q1 2025, representing a 6.1% quarterly growth rate and a substantial increase from $2.0 billion in Q1 2024. The loan portfolio remains diversified across various sectors, with a balanced mix of fixed-rate (46%) and variable-rate (54%) loans.
The deposit base grew to $2.4 billion, up 2.4% for the quarter and significantly higher than the $2.0 billion reported in Q1 2024. The deposit composition reflects a healthy balance between commercial (54%) and retail (46%) accounts, providing stability to the funding structure.
The following chart illustrates the composition of the bank’s deposit portfolio:
While asset quality remains generally strong, the presentation revealed an increase in nonperforming assets to $7.2 million in Q1 2025, up from $1.2 million in Q4 2023. However, the ratio of nonperforming loans to total loans remains manageable at 0.32%, and the allowance for credit losses to loans stands at a conservative 1.28%.
The bank’s asset quality metrics are detailed in the following chart:
The presentation also provided insight into the bank’s office building loan portfolio, which totals $220.6 million and represents a closely watched segment given current commercial real estate market concerns. The geographic composition of this portfolio is concentrated in Georgia (72%) and Alabama (24%), with a focus on smaller one- and two-story buildings that typically carry lower risk profiles than large urban office towers.
Growth Trajectory
Southern States has maintained impressive growth momentum since 2019, with compound annual growth rates of approximately 20-21% across key metrics including total assets, loans, and deposits. This consistent expansion demonstrates the effectiveness of the bank’s strategy in its target markets.
The following chart illustrates the bank’s growth history:
The presentation highlighted the bank’s presence in economically vibrant markets, including Atlanta (the 8th largest metro area in the USA), Birmingham (ranked 2nd best US city for job seekers by MoneyGeek), and Huntsville (voted best place to live by US News). These markets are projected to experience population growth exceeding both regional and national averages, providing a favorable backdrop for continued expansion.
Forward-Looking Statements
While the presentation focused primarily on quarterly results and the pending merger, it’s worth noting that the announced transaction with FB Financial represents a significant strategic pivot for Southern States. The merger will substantially expand the combined entity’s market presence and potentially create new growth opportunities.
The implied transaction value of $37.64 per share represents a premium to the current trading price, suggesting potential upside for shareholders who hold through the merger completion. However, as with any stock-for-stock transaction, the ultimate value will depend on FB Financial’s share price at closing.
Southern States Bancshares continues to demonstrate strong fundamental performance across key metrics, with the pending merger potentially accelerating its growth trajectory. Investors will likely focus on integration planning and potential synergies as the transaction moves toward its anticipated late 2025 closing date.
Full presentation:
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