Item 2.02. Results of Operations and Financial Condition.
On January 27, 2020, South State Corporation (the "Company") issued a press
release announcing its financial results for the fourth quarter and twelve
months ended December 31, 2019, along with certain other financial information.
A copy of the Company's press release is attached as Exhibit 99.1 to this report
and incorporated herein by reference.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
Exhibit No. Description of Exhibit
99.1 Press Release, dated January 27, 2020
Cautionary Statement Regarding Forward-Looking Statements
Statements included in this communication, which are not historical in nature
are intended to be, and are hereby identified as, forward-looking statements for
purposes of the safe harbor provided by Section 27A of the Securities Act of
1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking
statements are based on, among other things, management's beliefs, assumptions,
current expectations, estimates and projections about the financial services
industry, the economy and South State Corporation ("South State"). Words and
phrases such as "may," "approximately," "continue," "should," "expects,"
"projects," "anticipates," "is likely," "look ahead," "look forward,"
"believes," "will," "intends," "estimates," "strategy," "plan," "could,"
"potential," "possible" and variations of such words and similar expressions are
intended to identify such forward-looking statements. South State cautions
readers that forward looking statements are subject to certain risks,
uncertainties and assumptions that are difficult to predict with regard to,
among other things, timing, extent, likelihood and degree of occurrence, which
could cause actual results to differ materially from anticipated results. Such
risks, uncertainties and assumptions, include, among others, the following: (1)
economic downturn risk, potentially resulting in deterioration in the credit
markets, greater than expected noninterest expenses, excessive loan losses and
other negative consequences, which risks could be exacerbated by potential
negative economic developments resulting from federal spending cuts and/or one
or more federal budget-related impasses or actions; (2) increased expenses, loss
of revenues, and increased regulatory scrutiny associated with our total assets
having exceeded $10.0 billion; (3) controls and procedures risk, including the
potential failure or circumvention of our controls and procedures or failure to
comply with regulations related to controls and procedures; (4) ownership
dilution risk associated with potential acquisitions in which South State's
stock may be issued as consideration for an acquired company; (5) potential
deterioration in real estate values; (6) the impact of competition with other
financial institutions, including pricing pressures (including those resulting
from the Tax Cuts and Jobs Act) and the resulting impact, including as a result
of compression to net interest margin; (7) credit risks associated with an
obligor's failure to meet the terms of any contract with the bank or otherwise
fail to perform as agreed under the terms of any loan-related document; (8)
interest risk involving the effect of a change in interest rates on the bank's
earnings, the market value of the bank's loan and securities portfolios, and the
market value of South State's equity; (9) liquidity risk affecting the bank's
ability to meet its obligations when they come due; (10) risks associated with
an anticipated increase in South State's investment securities portfolio,
including risks associated with acquiring and holding investment securities or
potentially determining that the amount of investment securities South State
desires to acquire are not available on terms acceptable to South State; (11)
price risk focusing on changes in market factors that may affect the value of
traded instruments in "mark-to-market" portfolios; (12) transaction risk arising
from problems with service or product delivery; (13) compliance risk involving
risk to earnings or capital resulting from violations of or nonconformance with
laws, rules, regulations, prescribed practices, or ethical standards; (14)
regulatory change risk resulting from new laws, rules, regulations, accounting
principles, proscribed practices or ethical standards, including, without
limitation, the possibility that regulatory agencies may require higher levels
of capital above the current regulatory-mandated minimums and including the
impact of the recently enacted Tax Cuts and Jobs Act, the Consumer Financial
Protection Bureau rules and regulations, and the possibility of changes in
accounting standards, policies, principles and practices, including changes in
accounting principles relating to loan loss recognition (CECL); (15) strategic
risk resulting from adverse business decisions or improper implementation of
business decisions; (16) reputation risk that adversely affects earnings or
capital arising from negative public opinion; (17) terrorist activities risk
that results in loss of consumer confidence and economic disruptions; (18)
cybersecurity risk related to the dependence of South State on internal computer
systems and the technology of outside service providers, as well as the
potential impacts of third party security breaches, subjects each company to
potential business disruptions or financial losses resulting from deliberate
attacks or unintentional events; (19) greater than expected noninterest
expenses; (20) noninterest income risk resulting from the effect of regulations
that prohibit financial institutions from charging consumer fees for paying
overdrafts on ATM and one-time debit card transactions, unless the consumer
consents or opts-in to the overdraft service for those types of transactions;
(21) excessive loan losses; (22) failure to realize synergies and other
financial benefits from, and to limit liabilities associated with, mergers and
acquisitions within the expected time frame; (23) potential deposit attrition,
higher than expected costs, customer loss and business disruption associated
with merger and acquisition integration, including, without limitation, and
potential difficulties in maintaining relationships with key personnel; (24) the
risks of fluctuations in market prices for South State common stock that may or
may not reflect economic condition or performance of South State; (25) the
payment of dividends on South State common stock is subject to regulatory
supervision as well as the discretion of the board of directors of South State,
South State's performance and other factors; (26) operational, technological,
cultural, regulatory, legal, credit and other risks associated with the
exploration, consummation and integration of potential future acquisition,
whether involving stock or cash consideration; (27) risks related to the
proposed merger of South State and CenterState, including, among others, (i) the
risk that the cost savings and any revenue synergies from the merger may not be
fully realized or may take longer than anticipated to be realized, (ii)
disruption to the parties' businesses as a result of the announcement and
pendency of the merger, (iii) the occurrence of any event, change or other
circumstances that could give rise to the termination of the merger agreement
between CenterState and South State, (iv) the risk that the integration of each
party's operations will be materially delayed or will be more costly or
difficult than expected or that the parties are otherwise unable to successfully
integrate each party's businesses into the other's businesses, (v) the failure
to obtain the necessary approvals by the shareholders of South State or
CenterState, (vi) the amount of the costs, fees, expenses and charges related to
the merger, (vii) the ability of each of South State and CenterState to obtain
required governmental approvals of the merger (and the risk that such approvals
may result in the imposition of conditions that could adversely affect the
combined company or the expected benefits of the transaction), (viii)
reputational risk and the reaction of each company's customers, suppliers,
employees or other business partners to the merger, (ix) the failure of the
closing conditions in the merger agreement to be satisfied, or any unexpected
delay in closing the merger, (x) the possibility that the merger may be more
expensive to complete than anticipated, including as a result of unexpected
factors or events and (xi) the dilution caused by South State's issuance of
additional shares of its common stock in the merger, and (28) other risks and
uncertainties disclosed in South State's most recent Annual Report on Form 10-K
filed with the U.S. Securities and Exchange Commission ("SEC") or disclosed in
documents filed or furnished by South State with or to the SEC after the filing
of such Annual Reports on Form 10-K, and of which could cause actual results to
differ materially from future results expressed, implied or otherwise
anticipated by such forward-looking statements.
All forward-looking statements speak only as of the date they are made and are
based on information available at that time. South State does not undertake any
obligation to update or otherwise revise any forward-looking statements, whether
as a result of new information, future events, or otherwise, except as required
by federal securities laws. As forward-looking statements involve significant
risks and uncertainties, caution should be exercised against placing undue
reliance on such statements.
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