SouthState Bank Corporation (SSB) recently showcased robust financial performance in the fourth quarter of 2025, leading to an updated positive outlook from financial analysts. The bank's impressive growth in net income and earning assets, coupled with stable asset quality, has solidified its position as a promising investment within the banking sector. This robust performance is expected to maintain strong investor momentum for regional banks, driven by factors such as a steepening yield curve, accelerated loan growth, and increased merger and acquisition activities.
UBS Retains Favorable View on SouthState Bank Amidst Stellar Q4 Performance
In a significant development for investors, on Monday, February 16, 2026, leading global financial services company UBS reiterated its 'Buy' recommendation for SouthState Bank (SSB). The firm also adjusted its price target for SSB marginally upwards, from $120 to $121, signaling continued confidence in the bank's trajectory. This decision follows SouthState Bank's exceptional performance in the fourth quarter of 2025.
SouthState Bank's Q4 2025 earnings report, released on January 22, highlighted a remarkable 71.8% year-over-year surge in net income, reaching an impressive $247.7 million. Diluted earnings per share also saw a substantial increase of 31.6% year-over-year, climbing to $2.46. These strong figures led to significant improvements in key financial metrics, including a 24-basis point enhancement in return on average assets to 1.47% and a 178-basis point rise in return on common equity to 10.90%. Furthermore, the bank's book value per share appreciated by 18.4% year-over-year, reaching $91.38.
The primary catalyst for this robust earnings growth was a substantial 57.2% year-over-year increase in net interest income (NII), amounting to $581.1 million. This was fueled by both an expansion in net interest margin (NIM) and considerable growth in the bank's earning assets. NIM expanded by 38 basis points year-over-year to 3.86%, as the yield on average earning assets improved by 46 basis points to 5.62%, effectively offsetting a minor 9-basis point increase in funding costs.
The bank's earning assets expanded by 41.5% year-over-year, reaching $59.9 billion, largely driven by a 43.0% expansion in its loan book, which grew from $33.8 billion to $48.4 billion. This significant increase in earning assets was predominantly supported by a $17.1 billion year-over-year rise in deposits, from $38.1 billion to $55.1 billion, with the remaining funded by equity.
Crucially, the bank maintained sound asset quality in Q4. While the net charge-off ratio saw a slight increase of 3 basis points year-over-year to 0.09%, it showed an 18-basis point improvement quarter-on-quarter. Non-performing loans experienced only a 1-basis point increase year-over-year to 0.64%. The allowance for credit loss percentage improved by 17 basis points year-over-year to 1.20%, resulting in a modest 3.6% year-over-year growth in provisions for credit losses, totaling $6.6 million.
In a strategic move, SouthState Bank's board of directors also approved a new stock repurchase plan, authorizing the buyback of 5.56 million common shares, representing approximately 5.6% of the company's weighted average common shares outstanding as of December 31, 2025.
The sustained 'Buy' rating from UBS and the impressive financial results underscore SouthState Bank's operational efficiency and strategic growth. Investors should view these developments as indicators of the bank's resilience and potential for continued value creation in a dynamic financial landscape. The positive outlook for regional banks, supported by various economic factors, further strengthens the investment case for SSB.
