SouthState Corporation (SSB): Business Model Canvas [10-2024 Updated]
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SouthState Corporation (SSB) Bundle
In the competitive landscape of financial services, SouthState Corporation (SSB) stands out with its comprehensive business model that effectively caters to a diverse clientele. By leveraging strategic partnerships, a robust branch network, and a commitment to customer service, SSB has crafted a unique approach to banking. Discover how their value propositions, key activities, and revenue streams all come together to create a sustainable and profitable business model in the sections below.
SouthState Corporation (SSB) - Business Model: Key Partnerships
Collaborations with other financial institutions
SouthState Corporation engages in strategic partnerships with various financial institutions to enhance service offerings and expand market reach. Notably, as of September 30, 2024, the bank's total deposits amounted to $37.6 billion, with approximately 69% being insured or collateralized. The bank operates under a robust correspondent banking system, which allows it to offer competitive rates and services to clients while maintaining liquidity through interbank transactions.
Strategic mergers and acquisitions
In recent years, SouthState has pursued a growth strategy that includes mergers and acquisitions. The acquisition of Independent Bank Group, announced in 2024, is expected to significantly increase SouthState's footprint and total assets, which stood at approximately $46.1 billion as of September 30, 2024. The merger-related expenses increased by $3.1 million in Q3 2024 compared to the previous year, primarily due to costs associated with this acquisition.
Partnerships with technology providers
To enhance operational efficiency and customer service, SouthState collaborates with various technology providers. Investments in technology have become increasingly important, especially given the competitive landscape of the banking sector. In 2024, SouthState allocated significant resources towards upgrading its digital banking platforms, which is crucial for maintaining customer engagement and satisfaction. This includes partnerships aimed at improving online banking security and user experience.
Engagement with regulatory bodies
SouthState Corporation maintains active engagement with regulatory entities to ensure compliance and foster a favorable business environment. As of September 30, 2024, the bank's capital ratios were well above the minimum regulatory requirements, with a Common Equity Tier 1 ratio of 12.37%. This proactive approach not only mitigates regulatory risks but also positions the bank favorably for future growth and stability in the financial markets. The bank's compliance with FDIC assessments and other regulatory charges has strengthened its capital position, as evidenced by a decrease in these charges by 13.3% year-over-year.
| Partnership Type | Description | Impact |
|---|---|---|
| Financial Institutions | Collaborations to enhance deposit and loan offerings | $37.6 billion in total deposits |
| Mergers and Acquisitions | Acquisition of Independent Bank Group | Increased asset base to $46.1 billion |
| Technology Providers | Investments in digital banking upgrades | Improved customer engagement and security |
| Regulatory Bodies | Compliance with capital requirements | Common Equity Tier 1 ratio of 12.37% |
SouthState Corporation (SSB) - Business Model: Key Activities
Providing a wide range of financial services
SouthState Corporation (SSB) offers a diverse portfolio of financial services, including commercial banking, consumer banking, investment management, and mortgage banking. As of September 30, 2024, SSB reported total assets of approximately $45.4 billion, up from $44.2 billion at the end of 2023, indicating growth in its operational capacity and service offerings.
| Service Category | Revenue (Q3 2024) | Revenue (Q3 2023) | Growth Rate (%) |
|---|---|---|---|
| Commercial Banking | $200 million | $180 million | 11.1% |
| Consumer Banking | $150 million | $145 million | 3.4% |
| Investment Management | $75 million | $60 million | 25.0% |
| Mortgage Banking | $30 million | $20 million | 50.0% |
Loan origination and underwriting
Loan origination and underwriting are critical activities for SSB, contributing significantly to its revenue. The bank's loans, net of allowance for credit losses, reached approximately $33.08 billion as of September 30, 2024, reflecting an increase from $31.88 billion at the end of 2023. The loan-to-deposit ratio stood at 89% in September 2024, indicating robust lending operations relative to deposits.
| Loan Type | Amount Originated (Q3 2024) | Amount Originated (Q3 2023) | Growth Rate (%) |
|---|---|---|---|
| Commercial Loans | $1.5 billion | $1.2 billion | 25.0% |
| Consumer Loans | $500 million | $450 million | 11.1% |
| SBA Loans | $331.8 million | $250 million | 32.7% |
Asset management and investment services
SSB's asset management and investment services have seen substantial growth, with total assets under management reaching $7.1 billion as of September 30, 2024, compared to $6.5 billion at the end of 2023. The bank generated $33.06 million in trust and investment services income for the nine months ended September 30, 2024, up from $29.32 million in the same period in 2023.
| Service Category | Assets Under Management (AUM) | Revenue (Q3 2024) | Revenue (Q3 2023) |
|---|---|---|---|
| Mutual Funds | $2.5 billion | $10 million | $8 million |
| Retirement Accounts | $1.8 billion | $12 million | $10 million |
| Wealth Management | $2.8 billion | $11 million | $9 million |
Risk management and compliance activities
Risk management and compliance are paramount for SSB, especially in the current regulatory environment. The bank has invested heavily in compliance systems, with total compliance-related expenses reaching approximately $7.48 million for the third quarter of 2024, compared to $8.63 million in Q3 2023. The bank's capital ratios remain strong, with a Tier 1 capital ratio of 11.9% as of September 30, 2024, well above the regulatory minimum.
| Compliance Activity | Expense (Q3 2024) | Expense (Q3 2023) | Change (%) |
|---|---|---|---|
| Regulatory Compliance | $4.5 million | $5.0 million | -10.0% |
| Risk Assessment | $2.0 million | $2.5 million | -20.0% |
| Training & Development | $1.0 million | $1.1 million | -9.1% |
SouthState Corporation (SSB) - Business Model: Key Resources
Extensive branch network across six states
SouthState Corporation operates a robust branch network comprising over 200 branches across Florida, Georgia, South Carolina, North Carolina, Virginia, and Alabama. This extensive presence enables the bank to serve a diverse customer base, fostering local relationships and enhancing community engagement.
Capital reserves and liquidity management
As of September 30, 2024, SouthState Corporation reported total deposits of $37.6 billion, reflecting an increase of $589.3 million from December 31, 2023. The bank's liquidity position is supported by $1.2 billion in cash and cash equivalents, alongside a FHLB credit facility of $6.5 billion, of which $300 million was drawn down. The bank's loan-to-deposit ratio stood at 89%, indicating a healthy balance between loans and deposits.
| Liquidity Source | Amount (in millions) |
|---|---|
| Cash and Cash Equivalents | $1,200 |
| FHLB Credit Facility | $6,500 |
| Available Liquidity | $12,000 |
Skilled workforce of over 5,000 employees
SouthState Corporation employs a highly skilled workforce of approximately 5,000 employees. This team is crucial for delivering quality customer service and implementing the bank's strategic initiatives, contributing to its competitive advantage in the financial services sector. The bank's commitment to employee development ensures a knowledgeable and capable workforce, essential for navigating the complexities of the banking industry.
Technology platforms for online banking and trading
The bank has invested significantly in technology platforms to enhance its online banking and trading services. These platforms support a range of services including mobile banking, online trading, and digital payment solutions. SouthState's technology investments are aimed at improving customer experience and operational efficiency, enabling the bank to adapt to the evolving financial landscape.
SouthState Corporation (SSB) - Business Model: Value Propositions
Comprehensive banking solutions tailored for businesses and consumers
SouthState Corporation offers a variety of banking products designed to meet the needs of both businesses and consumers. As of September 30, 2024, total loans increased by $1.2 billion, or 4.8% annualized, reflecting strong organic growth. The non-acquired loan portfolio grew by approximately $2.2 billion, or 11.1% annualized, compared to the balance at December 31, 2023. This growth is attributed to a diverse range of lending options, including commercial, residential, and consumer loans, catering to a wide customer base.
Strong focus on customer service and relationship banking
Customer service is a central tenet of SouthState's business model. The bank emphasizes relationship banking, encouraging borrowers to maintain deposit accounts with the institution. This strategy enhances customer loyalty and retention. As of September 30, 2024, SouthState had over 1.4 million deposit accounts, indicating a broad customer base that benefits from personalized service. The company reported a net income of $143.2 million for Q3 2024, a 15.3% increase from the same period in 2023, showcasing effective customer engagement and service delivery.
Competitive interest rates and fee structures
SouthState Corporation maintains competitive interest rates and fee structures to attract and retain customers. As of September 30, 2024, the overall cost of funds, including demand deposits, was 1.99%, an increase from 1.52% in the previous year. The bank's total deposits reached $37.6 billion, increasing by $589.3 million from December 31, 2023. This growth was driven by an increase in money market accounts and time deposits, reflecting customers' preference for higher yield products.
| Deposit Type | Average Balance (in billions) | Cost of Funds (%) | Change from Previous Year |
|---|---|---|---|
| Noninterest-Bearing Deposits | 10.4 | 0.00 | -8.4% |
| Interest-Bearing Transaction Accounts | 19.7 | 2.49 | +1.96% |
| Time Deposits | 4.4 | 4.00 | +1.12% |
| Total Deposits | 37.6 | N/A | +1.6% |
Commitment to community engagement and local economic support
SouthState Corporation demonstrates a strong commitment to community engagement, focusing on local economic support. As of September 30, 2024, the bank had a total equity of $5.9 billion, up by $371.5 million (6.7%) from the previous year, indicating robust financial health that enables further investment in community initiatives. The bank actively participates in local development projects, small business lending, and affordable housing initiatives, reinforcing its role as a community partner.
SouthState Corporation (SSB) - Business Model: Customer Relationships
Personalized banking services and advice
SouthState Corporation offers personalized banking services tailored to individual customer needs. The bank operates across a six-state footprint, providing a wide range of financial products, including loans and investment services. As of September 30, 2024, SouthState reported total assets of approximately $46.1 billion and had 5,144 full-time equivalent employees. This extensive network enables the bank to offer customized financial advice and services, enhancing customer satisfaction and retention.
Loyalty programs for long-term customers
SouthState has implemented loyalty programs designed to reward long-term customers. These programs include tiered benefits based on account longevity and transaction volume. For instance, customers with significant deposits or loan balances may qualify for reduced fees and enhanced interest rates on savings products. The bank's efforts to maintain a granular deposit base, which includes over 1.4 million accounts with an average deposit size of $27,000, indicate a strong focus on customer loyalty.
Proactive communication through multiple channels
Communication with customers is a key aspect of SouthState's customer relationship strategy. The bank utilizes multiple channels, including email, SMS, and mobile app notifications, to keep customers informed about important updates, promotions, and personalized financial advice. As of September 30, 2024, the bank reported consolidated net income of $390.6 million for the nine months ended, reflecting a commitment to maintaining strong customer engagement.
Focus on customer feedback for service improvement
SouthState actively seeks customer feedback to enhance its service offerings. Regular surveys and feedback mechanisms are employed to gather insights on customer experiences and preferences. The bank's total noninterest income, amounting to $221.7 million for the nine months ended September 30, 2024, includes fees from deposit accounts and other services, highlighting the importance of meeting customer needs. This feedback loop allows SouthState to continuously adapt and refine its products and services based on customer expectations.
| Customer Relationship Strategy | Key Metrics | Impact on Business |
|---|---|---|
| Personalized Banking Services | Total Assets: $46.1 billion Employees: 5,144 |
Increased customer satisfaction and retention |
| Loyalty Programs | Accounts: 1.4 million Average Deposit: $27,000 |
Enhanced customer loyalty and reduced attrition |
| Proactive Communication | Net Income: $390.6 million (9 months) | Stronger customer engagement and service usage |
| Customer Feedback | Noninterest Income: $221.7 million (9 months) | Improved product offerings and customer satisfaction |
SouthState Corporation (SSB) - Business Model: Channels
Branch locations and ATMs
As of September 30, 2024, SouthState Corporation operated over 300 branch locations across six states: Alabama, Florida, Georgia, North Carolina, South Carolina, and Virginia. The bank also maintained approximately 500 ATMs within its footprint, providing customers with access to cash and banking services.
Online banking and mobile applications
SouthState has invested significantly in digital banking capabilities. The bank's online banking platform supports over 1.5 million active users, with mobile application downloads surpassing 800,000. In 2024, digital transactions accounted for 75% of all banking transactions, highlighting a strong shift towards online banking services.
Call centers for customer support
SouthState operates multiple call centers to handle customer inquiries and support. In the third quarter of 2024, the call centers managed over 1.2 million calls, achieving a customer satisfaction rate of 92%. The average wait time for customer service was reported at 2 minutes, demonstrating efficient service delivery.
Marketing through digital and traditional media
In 2024, SouthState Corporation allocated approximately $10 million to marketing initiatives. The marketing strategy includes both digital and traditional media, with 60% of the budget focused on digital platforms such as social media and online advertising. The remaining 40% was directed towards traditional media, including print and radio ads.
| Channel | Details | Statistics |
|---|---|---|
| Branch Locations | Number of branches | 300+ |
| ATMs | Number of ATMs | 500+ |
| Online Banking Users | Active users | 1.5 million |
| Mobile App Downloads | Total downloads | 800,000+ |
| Customer Support Calls | Calls managed in Q3 2024 | 1.2 million |
| Customer Satisfaction Rate | Satisfaction from call center | 92% |
| Average Wait Time | Time in minutes | 2 |
| Marketing Budget | Total marketing spend in 2024 | $10 million |
| Digital Marketing Spend | Percentage of marketing budget | 60% |
| Traditional Marketing Spend | Percentage of marketing budget | 40% |
SouthState Corporation (SSB) - Business Model: Customer Segments
Retail customers seeking personal banking solutions
As of September 30, 2024, SouthState Corporation reported total deposits of $37.6 billion, with retail customers comprising a significant portion of this figure. The average deposit size among retail customers is approximately $27,000, with over 1.4 million accounts contributing to a diverse retail banking segment. Retail banking products include checking accounts, savings accounts, and personal loans, all tailored to meet the needs of individual customers.
Small to medium-sized enterprises (SMEs)
SouthState serves approximately 95% of its commercial non-owner-occupied loans, totaling $9.2 billion, to SMEs within its operational footprint. The commercial and industrial loan segment has seen a notable increase, with a growth of $637 million year-to-date. The bank offers tailored financial products such as business checking accounts, lines of credit, and small business loans, which are essential for the operational growth of SMEs.
| Loan Type | Net Book Balance (in thousands) | Average Loan Size | Weighted Average Debt Service Coverage | Loan-to-Value Ratio |
|---|---|---|---|---|
| Commercial Non-Owner-Occupied | $9,200,000 | $1,694 | 1.62x | 57% |
| Commercial Owner-Occupied | $4,302,590 | $1,176 | 1.63x | 58% |
| Commercial and Industrial | $5,238,007 | $1,313,978 | 1.55x | 60% |
Commercial clients needing tailored financial products
Commercial clients represent a robust segment for SouthState, with total loans to commercial clients reaching $28.7 billion, or 85.5% of the total loan portfolio. The bank has seen a 4.8% annualized increase in total loans, driven by organic growth in commercial lending. The bank provides customized solutions such as treasury management, commercial real estate financing, and merchant services that align with the operational requirements of these clients.
High-net-worth individuals requiring wealth management
High-net-worth individuals are served through SouthState's wealth management division, which has reported significant growth in assets under management. The bank provides personalized financial planning, investment management, and trust services. As of September 30, 2024, the trust and investment services income was approximately $33.06 million, reflecting the bank's commitment to catering to the needs of affluent clients. The wealth management segment focuses on preserving and growing wealth through tailored investment strategies and estate planning services.
SouthState Corporation (SSB) - Business Model: Cost Structure
Operational costs for branch maintenance and staffing
As of September 30, 2024, SouthState Corporation reported total noninterest expense of $246.8 million for the third quarter, reflecting an increase of $8.6 million, or 3.6%, from the same period in 2023. Within this total, salaries and employee benefits amounted to $150.9 million, which was up by $4.7 million, or 3.2%, year-over-year. Additionally, occupancy expenses reached $22.2 million, showing a slight decrease from $22.3 million in Q3 2023. The increase in staffing costs is largely attributed to higher employee benefit costs associated with the Supplemental Executive Retirement Plans (SERP) and merit increases.
Marketing and advertising expenses
Marketing and advertising expenses for SouthState Corporation were recorded at $2.3 million for Q3 2024, compared to $3.0 million in Q3 2023. This represents a decrease of approximately 23.7%. Year-to-date, marketing expenses totaled $6.9 million, slightly up from $6.6 million the previous year. The bank's marketing strategy focuses on maintaining a competitive edge in customer acquisition amid rising interest rates and increased competition for deposits.
Technology investments for digital platforms
In Q3 2024, SouthState Corporation invested $23.3 million in information services, reflecting an increase of $1.9 million, or 8.6%, from Q3 2023. This investment is aimed at updating systems and enhancing digital banking platforms to improve customer experience and operational efficiency. The company is focusing on integrating advanced technologies to support its growing customer base and transaction volumes.
Regulatory compliance and risk management costs
Regulatory compliance and risk management costs were estimated at $7.5 million for Q3 2024, a decrease from $8.6 million in Q3 2023, primarily due to a lower FDIC assessment rate. The total FDIC assessment and other regulatory charges for the quarter were $7.5 million. Additionally, the bank accrued $4.5 million related to the FDIC’s special assessment intended to recover losses from bank failures in early 2023. The total regulatory charges reflect the bank's strengthened capital position year-over-year, which has allowed for better management of compliance costs.
| Cost Category | Q3 2024 Amount (in millions) | Q3 2023 Amount (in millions) | Year-over-Year Change (in millions) |
|---|---|---|---|
| Salaries and Employee Benefits | $150.9 | $146.1 | $4.7 |
| Occupancy Expense | $22.2 | $22.3 | ($0.1) |
| Marketing and Advertising | $2.3 | $3.0 | ($0.7) |
| Information Services | $23.3 | $21.4 | $1.9 |
| Regulatory Compliance Costs | $7.5 | $8.6 | ($1.1) |
SouthState Corporation (SSB) - Business Model: Revenue Streams
Interest income from loans and mortgages
For the nine months ended September 30, 2024, SouthState Corporation reported interest income from loans held for investment of approximately $1.4 billion, which reflects an increase of $176.7 million compared to the same period in 2023. The interest earned on loans included $491.4 million for the third quarter of 2024 alone, marking an increase of $48.1 million from the prior year.
Fees from financial services and transactions
SouthState's noninterest income for the third quarter of 2024 totaled $74.9 million, compared to $72.8 million in the same period of 2023. Key components of this income included:
- Service charges on deposit accounts: $23.7 million in Q3 2024, up from $22.7 million in Q3 2023.
- Debit, prepaid, ATM, and merchant card-related income: $10.3 million in Q3 2024, compared to $10.2 million in Q3 2023.
- Mortgage banking income: $3.2 million in Q3 2024, compared to $2.5 million in Q3 2023.
- Trust and investment services income: $11.6 million in Q3 2024, up from $9.6 million in Q3 2023.
- Bank-owned life insurance income: $8.3 million in Q3 2024, up from $7.0 million in Q3 2023.
Investment income from securities and asset management
As of September 30, 2024, SouthState's investment securities totaled approximately $7.1 billion, a decrease from $7.5 billion at December 31, 2023. The company reported net interest income from investment securities of $116.4 million for the nine months ended September 30, 2024. The average yield on these securities was approximately 2.40% during this period.
Income from correspondent banking and capital markets operations
Correspondent banking and capital markets income for the third quarter of 2024 was reported at $9.9 million, a decrease from $12.9 million in Q3 2023. This decline was primarily due to a reduction in income generated from customer swap ARC hedges in a higher interest rate environment. Additionally, the company reported total capital markets operations generating approximately $19.1 million for the nine months ended September 30, 2024.
| Revenue Stream | Q3 2024 (in millions) | Q3 2023 (in millions) | Nine Months 2024 (in millions) | Nine Months 2023 (in millions) |
|---|---|---|---|---|
| Interest income from loans | 491.4 | 443.3 | 1,400.0 | 1,223.3 |
| Fees from financial services | 74.9 | 72.8 | 221.7 | 221.4 |
| Investment income | 116.4 | 123.1 | 350.0 | 345.0 |
| Correspondent banking income | 9.9 | 12.9 | 19.1 | 45.7 |
Article updated on 8 Nov 2024
Resources:
- SouthState Corporation (SSB) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of SouthState Corporation (SSB)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View SouthState Corporation (SSB)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.