Earnings call transcript: Ameris Bancorp reports strong Q2 2025 financials

Ameris Bancorp (ABCB) reported robust financial results for the second quarter of 2025, showcasing significant growth in net income and earnings per share. The company’s stock price rose by 3.28%, closing at $72.52, following the announcement of a 21% increase in net income to $109.8 million. According to InvestingPro analysis, ABCB is currently trading near its 52-week high of $76.58, with an impressive 41.14% return over the past six months. The stock appears undervalued based on InvestingPro’s Fair Value calculations, suggesting potential upside opportunity. The company has also provided optimistic guidance for the coming quarters.

Key Takeaways

• Net income rose by 21% year-over-year to $109.8 million.
• Earnings per share (EPS) for the quarter was $1.60.
• The stock price increased by 3.28% following the earnings call.
• Mortgage production surged by 36% to $1.3 billion.
• The company expects mid-single-digit growth in loans and deposits.

Company Performance

Ameris Bancorp demonstrated strong performance in Q2 2025, with a notable increase in net income and EPS. The company’s focus on mortgage production and treasury management has contributed to its growth. The southeastern U.S. markets remain a key area for expansion, where the company continues to see heightened customer activity.

Financial Highlights

• Net income: $109.8 million, up 21% year-over-year
• Earnings per share: $1.60
• Return on Assets (ROA): 1.65%
• Return on Tangible Common Equity: 15.8%
• Efficiency Ratio: 51.63%
• Tangible Book Value per Share: $41.32, reflecting a 15.5% annualized growth

Outlook & Guidance

Ameris Bancorp remains optimistic about its future performance, projecting mid-single-digit growth in both loans and deposits. The company expects its Net Interest Margin (NIM) to normalize between 3.60% and 3.65%. Additionally, with the current stock valuation, there is potential for stock buybacks in the near future.

Executive Commentary

CEO H. Palmer Proctor Jr. emphasized the company’s focus on producing top-class results and maintaining a strong core deposit base. CFO Nicole Stokes highlighted that the company’s growth is currently margin accretive, indicating a positive financial trajectory. Proctor Jr. also noted an increase in customer and prospect activity, reflecting a vibrant market environment.

Risks and Challenges

• Competitive pressures in the southeastern U.S. markets could impact growth.
• Changes in interest rates may affect the Net Interest Margin.
• Economic fluctuations could influence loan and deposit growth.
• Regulatory changes in the banking sector could pose compliance challenges.
• The reliance on brokered CDs, though minimal, could affect deposit stability.

Ameris Bancorp’s Q2 2025 earnings call reflects a strong financial position and a positive outlook, supported by strategic growth initiatives and a focus on core banking operations.

Full transcript - Ameris Bancorp (ABCB) Q2 2025:

Wyatt, Conference Call Moderator: Good morning and welcome to the Ameris Bancorp second quarter conference call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today’s presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on the touchtone phone. To withdraw your question, please press star then two. Please note this event is being recorded. I would now like to turn the conference over to Nicole S. Stokes, Chief Financial Officer.

H. Palmer Proctor Jr., CEO, Ameris Bancorp: Please go ahead.

Nicole Stokes, Chief Financial Officer, Ameris Bancorp: Thank you, Wyatt, and thank you to all who have joined our call today. During the call, we will be referencing the press release and the financial highlights that are available on the Investor Relations section of our website at amerisbank.com. I’m joined today by Palmer Proctor, our CEO, and Doug Strange, our Chief Credit Officer. Palmer will begin with some opening comments, and then I will discuss the details of our financial results before we open up for Q&A. Before we begin, I’ll remind you that our comments may include forward-looking statements. These statements are subject to risks and uncertainties. The actual results could vary materially. We list some of the factors that might cause results to differ in our press release and in our SEC filings, which are available on our website.

We do not assume any obligation to update any forward-looking statements as a result of new information, early developments, or otherwise, except as required by law. Also, during the call, we will discuss certain non-GAAP financial measures in reference to the company’s performance. You can see our reconciliation of these measures and GAAP financial measures in the appendix to our presentation. With that, I’ll turn it over to Palmer.

H. Palmer Proctor Jr., CEO, Ameris Bancorp: Thank you, Nicole. Good morning, everyone. We appreciate you joining our call today. I am very proud of our second quarter results, which again beat expectations and resulted in an increase in our return on assets, PPNR, ROA, return on tangible common equity, and an improved efficiency ratio. As you can see, we remain focused on enhancing revenue generation and positive operating leverage. This is evidenced by our 20+% annualized revenue growth in the quarter, which was almost double our expense growth, which pushed our efficiency ratio to below 52%. Our margin continued to expand during the quarter while we grew loans 6.5% annualized, which is within our mid-single-digit guidance. Our 3.77% NIM remains well above most peer levels, particularly thanks to our strong 31% level of noninterest-bearing deposits. Capital ratios grew again in the quarter, which positions us well for future growth opportunities.

Our strong second quarter earnings and capital generation increased our Common Equity Tier 1 to 13% and TCE to over 11%. We also saw improvement across the board in all aspects of asset quality. We grew tangible book value this quarter by 15.5% annualized, passing through the $40 level for the first time to finish the quarter over $41 per share. We now have $50 of tangible book value in our sights. We were active in repurchasing stock, buying back $12.8 million in the quarter. Our CRE and construction concentrations remain low at 261% and 45%, respectively. Our strong loan growth is driven mostly by CNI. Deposits grew as well, but at a smaller pace. Noninterest-bearing deposits remained our core focus. With those balances growing over 3% annualized, our bankers are well positioned to take advantage of growth opportunities and disruption within our attractive southeastern U.S. markets.

In fact, production increased 29% from the first quarter, with this quarter having the highest loan production since 2022. Overall, we continue to stay focused on what we can control. When I look out for the back half of 2025, I’m encouraged as we continue to benefit from a robust margin, a solid noninterest-bearing deposit base, a diversified revenue stream, strong capital and liquidity, a healthy allowance and asset quality, proven culture of expense control and positive operating leverage, experienced local bankers in top Southeast markets, and obviously notable scarcity value given our size and scale in those markets, which allows us to take advantage of the banking disruption the Southeast continues to experience. Overall, I’m extremely optimistic for the remainder of 2025 and into 2026. I’ll stop there and turn over to Nicole to discuss our financial results in more detail.

Nicole Stokes, Chief Financial Officer, Ameris Bancorp: Great. Thank you, Palmer. We reported net income of $109.8 million or $1.60 per diluted share in the second quarter, which was a notable 21% increase over the year-ago quarter. As Palmer mentioned, our profitability improved to levels well ahead of our recent path, with an ROA and return on tangible common equity both moving higher. Our efficiency ratio improved to 51.63% this quarter compared to 52.83% last quarter as we continue to focus on positive operating leverage, evidenced by our revenue growth of 20.9% annualized, well outpacing our expense growth this quarter. Our return on assets was robust at 1.65%, our PPNR ROA was 2.18%, and our return on tangible common equity was 15.8%. All of these profitability metrics remain top of class.

Capital levels continue to strengthen, and tangible book value per share increased to $41.32 per share, which was a strong 15.5% annualized growth or $1.54 per share in the quarter. Our tangible common equity ratio increased to 11.09% at the end of the quarter, and we did repurchase about $12.8 million of common stock or about 212,000 shares during the second quarter, and we’ve got about $72 million remaining through the end of October available to purchase. Our strong revenue growth was driven by increases in both net interest income and fee income. Our spread income grew by $10 million in the quarter, or 18% annualized, and I’ll note here that our average earning assets increased $564 million, or over 9% annualized, this quarter. In addition to that, our net interest margin continued expanding, up 4 basis points this quarter to a strong 3.77%.

Remember, this margin is a core margin. We have zero accretion in that margin. The modest margin expansion came mostly from the asset side, with a 3 basis point positive impact on our loans and 1 basis point from a higher bond yield. The previous benefit to our margin from the lower funding cost has been fully realized, with our total cost of funds remaining flat during the quarter. We believe that we will see margin normalize above the 3.60% to 3.65% range over the next few quarters as we expect pressure on deposits. As we see loan growth pick up the second half of the year, we continue to be close to neutral in asset sensitivity. Noninterest income increased about $4.9 million this quarter, mostly from better mortgage.

Our mortgage production grew 36% in the quarter to approximately $1.3 billion, and our mortgage gain on sale climbed 5 basis points to 2.22%. Total noninterest expense increased $4.2 million in the second quarter, mostly driven by higher salaries and employee benefits related to the stronger mortgage production and our annual merit increases. As I previously mentioned, our efficiency ratio was strong at 51.63% during the second quarter. Our provision for credit losses was $2.8 million. Our reserve remained strong at 162% of loans or 408% of our portfolio NPLs. Overall asset quality trends were favorable with nonperforming assets, net charge-offs, and both classified and criticized all improving in the quarter. Our annualized net charge-off improved 14 basis points. Looking at our balance sheet, we ended the quarter with $26.7 billion of total assets compared to $26.5 billion last quarter.

Loan growth returned with an increase of $335 million or 6.5% annualized in line with our loan growth guidance. Loan growth was mostly from CNI loans this quarter, particularly mortgage, warehouse, and premium finance. Total loan production in the quarter was $1.9 billion, up nicely from last quarter’s $1.5 billion of production, and deposits increased $20 million. With a continued seasonal decline in cyclical municipal deposits of $77 million, offset by an increase in broker deposits of $82 million, we were able to grow noninterest-bearing deposits, increasing our percentage to 31% of total deposits from 30.8% last quarter. Our brokered CDs represent only 5% of total deposits. We continue to anticipate loan and deposit growth going forward in the mid-single-digit range and expect that longer-term deposit growth will continue to be the governor of loan growth.

With that, I’ll wrap it up and turn the call back over to Wyatt for any questions from the group.

Wyatt, Conference Call Moderator: Thank you. We will now begin the question and answer session. To ask a question, you may press star then 1 on your touchtone phone. If you are using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star then 2. Our first question will come from Stephen Scouten with Piper Sandler.

H. Palmer Proctor Jr., CEO, Ameris Bancorp: Please go ahead.

Yeah, good morning. Thanks, Raymond.

Good morning.

I guess maybe my first question would be around kind of loan growth trends, what you’re seeing from your customers, maybe any sort of color into the existing pipelines, and maybe within that the mortgage warehouse lending, if this should be kind of a seasonal peak for that component of the loan book and how we should think about maybe the competition moving.

Wyatt, Conference Call Moderator: Forward a little bit.

H. Palmer Proctor Jr., CEO, Ameris Bancorp: Yeah, I’ll answer that question, Palmer, in reverse order. The mortgage warehouse, certainly there’s seasonality to that. This was a very strong quarter for that. That being said, as it pertains to the other lines and pipelines and production, I think it’s probably very reflective of what we’re seeing in the market. There is a, I would call a resurgence of activity, much better than what we saw in the first quarter. I think that we’re hopeful that that will continue throughout the remainder of the year and into 2026. At the same time, I think there’s a bit of caution that still remains out there. Our bankers are seeing more opportunities, certainly becoming more competitive, which is always a good sign of that increased competition in terms of activity.

I would expect that third quarter would end up being very similar to second quarter in terms of activities that we’re seeing, unless there’s some unforeseen event that takes place.

Okay, great, that’s helpful. Maybe thinking about kind of future growth opportunities. Capital continues to build, build rapidly. I think you’ve said in the past, kind of a measured approach to kind of how you would deploy that excess capital. Any kind of change in terms of maybe preferences, order of operations there, whether that’s new hires, potential M&A, additional balance sheet kind of remixing and the like.

Wyatt, Conference Call Moderator: Sure.

H. Palmer Proctor Jr., CEO, Ameris Bancorp: I don’t want to sound like a broken record, but as we’ve said all along, when I look at our bankers and how we’re positioned in the growth markets we’re in, we have got the right talent in the right place to execute on our plan in terms of what we have. That doesn’t mean we’re not actively looking or won’t look for new talent that comes in. We’re, as you know, very consequential with talent and we expect it to produce. Year to date, when you look at revenue generators, we brought in about 64 new revenue generators. At the same time, we’re very consequential in moving out those that aren’t generating revenue.

What I see now is the opportunity to really accelerate because of how we’re already positioned, not need what we do, not something we need to do to get positioned, but how we’re already positioned in the key southeastern U.S. growth markets. I think when you look at the opportunities that are out there as it pertains to capital, our first and foremost is growing organically. After that, there’s certainly, especially where we’re trading today, I wouldn’t say that stock buybacks aren’t on the table because relative to where we trade today and the value we’re creating, the stock is cheap in my opinion. Also, we’ve got the dividend, we increased the dividend before, so I don’t see a whole lot of changes there. The proverbial M&A question, it would take a lot to distract us.

It’d have to be something very, very special because right now we’re firing on all cylinders. To distract us from something like that, as well positioned as we are on a go forward basis, I think we will remain focused as we have been for the last five and a half years on organic growth.

Great. Maybe just one follow up to that question is on the new hire activity. That seems to be the going trend at an accelerating pace. I feel like relative to five years ago, six years ago, everyone now is talking about team lift outs for new hires versus maybe M&A in the past. How do you differentiate yourself and how do you convince people to come to Ameris versus other banks that might also be trying to bring that banker?

Yeah, I think what sells people on our model is we’re focused on market share, not just having a pin on a map. When you look at the density we have in a lot of our key growth markets, what bankers like is a presence and a commitment to a market, which we certainly make in every one that we’re in. They also like to see that we’ve got some stability in those markets. They like to see that we’ve got an organic engine that can grow. In today’s world, they like an environment that’s not as volatile in terms of the work environment that they’re in. Our plans are very clear, especially for the revenue generators on the core banking side. It’s very heavy on the deposit side focus relative to a lot of peer plans, and they come in with clear expectations.

Those expectations also allow them to understand that they need to deliver. If they deliver, they’re well compensated for it. If they don’t, we try to do what we can to coach them up. I think it all comes down to accountability here. To be able to work for a company that’s been around for 50 years, that’s got a clear business model, there’s not any noise out there, and you can go ahead and focus on what you need to focus on and not get distracted by a lot of changes, that’s probably the biggest selling point we have in today’s market.

Perfect. Thanks for all the color.

Congrats on the fantastic quarter.

Thank you.

Wyatt, Conference Call Moderator: Our next question will come from Catherine Mealor with KBW. Please go ahead.

Nicole Stokes, Chief Financial Officer, Ameris Bancorp: Thanks. Good morning.

Talk about the margin and maybe the balance sheet. I think just to go back first on the balance sheet side, I noticed that you added some securities this quarter, and so curious. You know, you talked about mid single digit growth in loans, and that was so great to see this quarter, better than I expected. In terms of the bond book, do you expect to continue to build that through the back half of the year, or as loan growth improves, does that kind of pare back a little bit?

You know, we like the optionality that we have there. This is kind of what I would call the tail end of that strategy of, you know, going back, not getting into the bond book and having the AICI issue several years ago. We still, you know, historically we would be about 9% of earning assets pre-pandemic would be in our bond portfolio. We could still add about another $200 million to the portfolio to get there. We could add another $400 million to get to about 10%. We like that optionality we have there, that we have both the loan book that we can grow and the bond book. I would definitely say that we could go either place. What we do have also for the rest of the year, we have about $71 million that’s going to mature out and that’s coming out at a 3.50% rate.

What we’re putting on right now is coming in much higher than that, almost 4.50%, 4.75%, 5%. As we’re circling that out, we like doing that in a bond book. If we have some opportunities to put some 4.75%, 5% bonds in there with a good duration, we’ll capitalize on that opportunity when we see it.

Great, that’s super helpful.

Maybe circling back to.

The margin, if you had another margin beat, I know you’re guiding for that to be. I think you said normalize above the 360 to 365 range just because of deposit costs. I guess I was just kind of your view on deposit costs, maybe how we think about that in a stable rate environment. Maybe in the third quarter, if we don’t see rate cuts this quarter, it seems like you still think that will increase a little bit this quarter. Then how you’re thinking about deposit costs as we start to see cuts.

Yep. Assuming the Fed stays flat and we don’t see any cuts, I just feel like there’s going to be some pressure on that deposit cost. Everybody is talking about loan growth in the second half of the year. I think as we start to see that loan growth demand pick up, we’re going to see just as much demand because everybody’s going to be competing on the deposit side. When you look at the second quarter, we brought in our interest bearing, came in at a 2.99 kind of spot production for the quarter. That’s compared to a book of 2.83. We already see that new production coming on a little bit higher than the current mix. I just think that that’s going to get more aggressive and more pressure as we see the loan growth demand come in.

Assuming that the Fed did cut, we think that we would be just as aggressive as we have been in the past on reducing those. If the Fed were to cut, I think we could maybe see a little bit of bump in the margin just from getting that head, getting ahead of the curve there on the deposit side, knowing that the loan side would eventually catch up. We could see a small little pop on the deposit side if the Fed cut.

Okay, great. Very helpful. Great quarter, guys. Appreciate it.

H. Palmer Proctor Jr., CEO, Ameris Bancorp: Thanks.

Nicole Stokes, Chief Financial Officer, Ameris Bancorp: Thank you.

Wyatt, Conference Call Moderator: Our next question will come from David Feaster with Raymond James. Please go ahead.

Hi, good morning, everybody. I just wanted to follow up maybe on the commentary on the growth side. It sounds like the increase in your origination activity that you saw, of course, really more of a function of your bankers being increasingly productive and gaining share versus real improvement in demand. Is that a fair characterization? I was hoping you could elaborate too on your commentary on the competitive landscape. Are there any segments or markets that are notably challenging, and whether competition is primarily centered on pricing, or have you seen competition shift towards more underwriting structure and standards too?

H. Palmer Proctor Jr., CEO, Ameris Bancorp: Yeah, I think it depends on the business line. I would say across the board we’re seeing more activity and I don’t know if it’s, I think it’s more of a reflection of customers and prospects becoming more active. Our bankers have been out actively calling, so it’s not like anybody was sitting on the sidelines. I think people are just now moving forward with whatever initiatives they’ve got, especially in that middle market space. Along those same lines, the middle market type lending, you know, the nice thing about our company is we’ve got the scale and the size to do what we need to do in terms of accommodating borrowing needs, treasury management needs. We focus heavily, especially on treasury management calling. That’s been very helpful on our deposit growth.

I would tell you there is a lot of competition out there and it’s starting to go beyond pricing now. There are some structural changes that we’re starting to see out there. People getting aggressive, nothing crazy, but it is different. I think that’s a sign just that more people are needing that growth, wanting that growth, and fortunately, hopefully will continue to come. As we look out and look at the pipeline that we see, if you break ours down by vertical, clearly the equipment finance and the premium finance mortgage warehouse has done well. Retail mortgage volume, just due to rates, has been a little bit subdued. If we see some rate improvement towards the end of the year there or next year, that’s certainly something that we can ramp up very quickly and capitalize on.

I think the most encouraging thing for us though is the continued growth we’re seeing and our focus on deposits and leading with deposits instead of just leading with loans and pricing. I would kind of give it an overall more positive outlook for going into third quarter than what we had seen obviously in the first quarter. Does that answer your question?

Wyatt, Conference Call Moderator: Yep.

No, that’s super helpful. Maybe, Nicole, as you talk about that 3.60% to 3.65% margin guide, is that purely a function of higher marginal funding costs to support the growth, or does that incorporate any Fed rate cuts in that, and just kind of how do you think about the timeline of hitting that range? Is that kind of a step change that you would expect here in the third or fourth quarter? Just kind of curious some of your thoughts on that.

Nicole Stokes, Chief Financial Officer, Ameris Bancorp: Yep. That assumes no rate cuts. That is a flat environment. Like I said, if the Fed did cut, we could actually see a little bit of a bump because we feel like we would be aggressive on the deposit repricing side and then, you know, eventually the loans would catch up to us. That 3.63% to 3.65% guide is over the longer term. I don’t think that’s a sudden drop in the third or fourth quarter. I think that’s just a longer term margin guide looking out 18 months or so to say that we feel like there’s going to be some deposit pressure as we see the loan growth come back and there’s going to be again that competitive pressure. I think we’re going to see some pressure on the deposit side paying up.

We might see a little bit on the loan side as well as people get competitive for that. I think that we’re going to get squeezed a little bit and that we’re in a spot to compete with a margin as strong as we have. If we give up a little bit for the growth, we continue to focus on the growth in net interest income and then the growth in earning assets.

Wyatt, Conference Call Moderator: Okay.

Maybe just last one, just touching on the mortgage segment. Nice to see the seasonal increase, still primarily purchase driven. Just kind of curious, maybe some of the underlying trends you’re seeing there and how your capacity is today. I know you’ve made a lot of efficiency improvements, but how’s your capacity today? If we do get a refi wave as rates potentially decline, we’ve seen how quickly that can move, and then just any thoughts on the gain on sales side as we look forward?

Nicole Stokes, Chief Financial Officer, Ameris Bancorp: Sure. For mortgage, I would say that the third quarter, I would see it being consistent with the second quarter, maybe down a little bit, just some of the trends that we’re seeing. When I say a little bit, you know, 5% to 10% down on production. We’ve seen the gain on sale pick up from that $2.17 to the $2.22. I think we’ve seen that kind of hold. We’re only three weeks in, but assuming that holds in that $2.15 to $2.25 range. I think third quarter will be consistent with second quarter as far as what we could do if we saw a refi boom. Our team’s ready to go. We don’t need to add people, and we’ve got the resources that if a refi boom were to happen, rates come down and we see that opportunity, our folks are ready to go with it.

H. Palmer Proctor Jr., CEO, Ameris Bancorp: David, as we said, the nice thing about mortgage, when you look at the profitability of it as it stands today relative to peers, it’s really phenomenal how well they’ve done. This is kind of a baseline. Any improvement we get in rates from here would just be icing on the cake.

That’s helpful. Thanks, everybody.

Wyatt, Conference Call Moderator: Our next question will come from Russell Gunther with Stephens.

H. Palmer Proctor Jr., CEO, Ameris Bancorp: Please go ahead. Good morning, guys.

Nicole Stokes, Chief Financial Officer, Ameris Bancorp: Good morning.

H. Palmer Proctor Jr., CEO, Ameris Bancorp: I have a margin follow-up question to start, please, Nicole. It’d be helpful to get a sense for the cadence of the NIM over the course of the quarter, from that kind of 3.69% March start to where we ended up, 3.77%. If possible, any commentary on where the June shook out?

Nicole Stokes, Chief Financial Officer, Ameris Bancorp: Yes. The margin was kind of growing throughout the quarter. It was just a steady growth month over month. For the month of June, there were some anomalies. I hate to give this number out because it was higher than the 377, but there were some anomalies in that margin. This kind of brings me back to saying that flat 377 margin, maybe a few basis points up or down in the third quarter, but eventually over the long term being willing to give up a little bit of our margin to get the growth.

H. Palmer Proctor Jr., CEO, Ameris Bancorp: Okay, that’s very helpful. I appreciate the color. Switching gears back to the loan growth side, you guys mentioned strength in equipment finance. It’d be helpful to get a sense for kind of where those related loan balances are this quarter versus last.

Wyatt, Conference Call Moderator: Last.

H. Palmer Proctor Jr., CEO, Ameris Bancorp: Similarly, on the charge-off, done. What are your related balance sheet growth versus gain on sale expectations there?

On Balboa, we ended at about $1.5 million, sorry, equipment finance, about 7.2% of our loans. The charge offs overall for the company, which Equipment Finance has contributed to. Once we retooled our credit box in 2023, it performed as we expected. For the last rolling four quarters, we now have that in the target range that we were seeking for Equipment Finance charge offs.

Okay, got it. Thank you for that. Just last one for me. Great expense results both this quarter and on a year over year basis. Efficiency ratio lower on both those data points. Nicole, it’d be helpful to just get a sense for how you’re thinking three Q looks from a noninterest expense perspective.

Nicole Stokes, Chief Financial Officer, Ameris Bancorp: Yeah, I think 3Q, when you think about what the bump in second quarter compared to first quarter was, really related to that increased production in mortgage. If we see that production come in consistent, those expenses should be consistent. We also have the merit increases that would go into effect April 1 for us; we had a full quarter of merit increases. I see the third quarter being consistent with the second quarter. I think consensus has it bumping up just a little bit, and I think that kind of makes sense. That’s reasonable to me. I would say somewhere in that $156 million to $158 million, which is right, kind of where consensus is and consistent with the second quarter.

H. Palmer Proctor Jr., CEO, Ameris Bancorp: All right, very good. Thank you guys for taking my questions.

Nicole Stokes, Chief Financial Officer, Ameris Bancorp: Absolutely. Thanks.

Wyatt, Conference Call Moderator: Our next question will come from Christopher Marinac with Janney Montgomery Scott. Please go ahead.

Hey, thanks. Good morning, Nicole and Palmer. I wanted to dig into the deposits. I think it’s slide 11 in terms of just the numbers of accounts as well as for the average. What’s the right way to think about that over time? Not just quarter to quarter, but thinking of it from last year and the prior year. You’ve been giving us this data for a while.

Nicole Stokes, Chief Financial Officer, Ameris Bancorp: Yeah, no, we have been very consistent. I think that’s one of the things that we probably don’t brag on ourselves enough about is our very, very granular deposit base and that you don’t get this kind of deposit base overnight. This is a 50 year history franchise of growing our deposits. When you look back at our deposits, we did a kind of backlook of how many have been since the Fidelity acquisition, how many came in from Fidelity and then how many prior to that. We have a really, really strong core deposit base that have been here for a long, long time. Even through our acquisitions, they’ve had a long history. We’ve been able to retain those deposits. I think this is very, very consistent. The very granular deposit base that we’ve had. This is not a new thing.

H. Palmer Proctor Jr., CEO, Ameris Bancorp: Great.

Do you think that the pace of deposits will look different the next couple of quarters? I know part of the margin guide kind of implies that. Just trying to think about if we should see an acceleration in the next few quarters.

Nicole Stokes, Chief Financial Officer, Ameris Bancorp: You know, we continue to look and lead with deposits and are so proud of our bankers for that, that we don’t just have loan officers, we have bankers and that they’re asking for the deposits and growing deposits. I think the big question there for us is we know that we can grow deposits, but it’s at what rate can we grow deposits? We’ve been so focused on the noninterest-bearing and to have 31% of our franchise in noninterest-bearing, the question is, can 30%, 31% of our growth be in noninterest-bearing? While we continue to focus on that growth in noninterest-bearing, the percentage to the total may change a little bit. Obviously, coming in kind of the end of the third quarter into the fourth quarter, we have all those cyclical municipal funds that flow back in.

That always kind of makes us look a little bloated on deposits at the end of the year. Again, we remain focused on growing deposits. We have some runway with FHLB advances or brokerage CDs. The brokerage CDs are only 5% of our funding. We really focus on growing those core deposits. That’s definitely the goal, to continue to grow that. Hence why my guidance is that we are willing to maybe pay up for that growth if we need to.

Okay, great. Thank you for that background.

Wyatt, Conference Call Moderator: That’s great.

I had a question on the reserve. Just curious if there’s any qualitative changes to some of the factors behind the scenes this quarter or some of those possibilities as drivers of your reserve the next several quarters.

Yeah, Chris, we did a little bit of a key factor as it relates to investor office and the office slide. We now have that reserve at about 3.8% for that sector now.

Given just the low level of charge-offs and overall low level of criticized, does that give you flexibility to simply grow into the reserve, or do you think of it any differently?

No, we do. I mean, having a robust reserve, which we do at the $162 million, we would consider that among top of class amongst our peer, and you look at it through two different lenses. One, the offensive strategy in that we grow into it, which is what we want to do. If you turn into a credit cycle, it’s there as a defensive position as well.

Great, thanks for taking all of our questions this morning.

H. Palmer Proctor Jr., CEO, Ameris Bancorp: Thank you, Chris.

Wyatt, Conference Call Moderator: Our next question will come from Manuel Navas with D.A. Davidson. Please go ahead.

H. Palmer Proctor Jr., CEO, Ameris Bancorp: Hey, getting back to that kind of long-term min range of 3.63, 3.65, we’re going to sit above it for some time. What could bring that range higher? Is this just like a steeper yield curve, success on deposits? Just kind of some of the drivers.

Nicole Stokes, Chief Financial Officer, Ameris Bancorp: There also with all of the above. Yes, I think that success on the deposit side would absolutely drive it higher. If the Fed cuts and we are able to reduce the deposit side as we typically would or historically would, that would give us a little margin pop. Right now all of our growth is margin accretive. When you look at the second quarter, what our loan coming on rate, loan production rate versus our deposit production rate, all of our growth is margin accretive. I’ll tell you for this quarter, if you look at our loan rate of 6.76% kind of all in production and our interest-bearing deposits were at 2.99%. That’s right at a 3.76%. What really is going to drive that is that growth in noninterest-bearing deposits.

If we get the growth in noninterest-bearing deposits that brings down our total production of deposits, that’s really what could also kind of help the margin there. We are still proud to say that our growth is margin accretive at this point.

H. Palmer Proctor Jr., CEO, Ameris Bancorp: I was going to ask you about long yields. I appreciate that kind of description of the marginal nimble. How are noninterest-bearing pipelines right now? I know they’re lumpy, hard to project, but just kind of some thoughts on that side of the deposit base. Yeah, I would tell you that they’re accelerating. It’s very similar, kind of mirrors our loan production and a lot of that, as I mentioned earlier, is attributed to our treasury management efforts. In addition, obviously the bankers. We’re seeing more and more opportunities, and you know, leading with deposits has really been helpful in our approach there. I think that’s really what’s driving the opportunities that we’re seeing as of recent. I would tell you that we’re encouraged by what we’re seeing as we move into the second half of the year.

I appreciate that the securities yield increase was there. Was that like a one-time adjustment in securities, or is that just you’re adding those higher yield increase securities this quarter?

Nicole Stokes, Chief Financial Officer, Ameris Bancorp: Is adding our securities. During the quarter we bought about $200 million that came on at a 4.88% and we matured out about $260 million that was at a 2.77%.

H. Palmer Proctor Jr., CEO, Ameris Bancorp: Perfect. Perfect. I appreciate that. Thank you for the commentary.

Nicole Stokes, Chief Financial Officer, Ameris Bancorp: Sure.

Wyatt, Conference Call Moderator: This will conclude our question and answer session. I would like to turn the conference back over to H. Palmer Proctor Jr. for any closing remarks.

H. Palmer Proctor Jr., CEO, Ameris Bancorp: Great. Thank you, Wyatt. I want to thank all of our teammates for another outstanding quarter. We remain focused on producing top of class results, growing our tangible book value per share, and maintaining our strong core deposit base. We are very well positioned to take advantage of future growth opportunities in our attractive southeastern U.S. markets. We certainly appreciate your interest in Ameris Bank.

Wyatt, Conference Call Moderator: The conference has now concluded. Thank you for attending today’s presentation. You may now disconnect.

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