MYRTLE BEACH, S.C., April 23, 2024 /PRNewswire/ -- South Atlantic Bancshares, Inc. ("South Atlantic" or the "Company") (OTCQX:SABK), parent of South Atlantic Bank (the "Bank"), reported consolidated net income of $2.0 million, or $0.26 per diluted common share, for the three months ended March 31, 2024. First Quarter 2024 Financial Highlights: Total assets increased $51.8 million to $1.69 billion during the quarter ended March 31, 2024, an 11.8 percent annualized increase from December 31, 2023 Total deposits grew $45.2 million to $1.34 billion during the quarter ended March 31, 2024, a 14.0 percent annualized increase from December 31, 2023 Cash and cash equivalents increased $41.3 million during the first quarter of 2024 to $78.5 million, which represents a quarterly increase of 111.1% Total loans increased $21.3 million during the first quarter of 2024 with a weighted average yield on new production over 8.50% Tangible book value per share at March 31, 2024 increased by $1.39, or 11.9 percent, to $13.05 per share when compared to the same quarter in 2023 Interest income on loans and investments increased $749 thousand during the first quarter of 2024, or 15.4 percent annualized when compared to the fourth quarter of 2023 Net income totaled $2.0 million for the first quarter of 2024, which represents a slight decrease when compared to the fourth quarter of 2023 Commenting on the Company's results, Chairman and Chief Executive Officer, K. Wayne Wicker, remarked, "The first quarter of 2024 was a solid quarter for our Company. After two years of record loan growth in 2022 and 2023, we intentionally entered 2024 with a strategic plan for more measured loan growth, coupled with a focus on growing core deposit relationships. Our team is executing on that plan with annualized deposit growth of 14.0%, and annualized loan growth of 7.2%. Cash and cash equivalents increased 111.1% during the first quarter of 2024. Economic activity remains high in our markets, and we continue to see very strong credit metrics across our portfolio. The prolonged elevated interest rate environment and increased competition for deposits continues to pressure our funding costs. After two quarters of stable margin levels, we experienced a decrease in the first quarter of 2024, with the majority of our increased margin compression during the period stemming from a large banking relationship repricing from low cost to higher yield deposit products. While this outsized movement in interest expense has pressured net interest margin for the quarter, we do not anticipate continued downward margin compression at that level in future periods. We remain focused on curtailing overhead and generating operating efficiencies, and we believe we are well positioned to navigate the uncertain economic environment which lies ahead. "     Selected Financial Highlights   For the Periods/Three Months Ended  March 31, December 31, Balance Sheet (000's) 2024 2023 Change ($) Change (%)1 Total Assets $        1,669,955 $       1,622,250 $          47,705 11.8 % Total Loans, Net of Unearned Income 1,205,453 1,184,187 21,266 7.2 % Total Deposits 1,339,290 1,294,097 45,193 14.0 % Total Equity 104,872 102,954 1,918 7.5 % March 31, December 31, Income Statement and Per Share Data 2024 2023 Change ($) Change (%) Net Income (000's) $               2,007 $              2,193 $              (186) -8.5 % Earnings Per Share 0.26 0.29 (0.03) -10.3 % March 31, December 31, Selected Financial Ratios 2024 2023 Return on Average Assets 0.49 % 0.55 % NPAs to Average Assets 0.00 % 0.00 % Efficiency Ratio 75.22 % 70.46 % Net Interest Margin  2.64 % 2.82 % 1 Results annualized.  Earnings Summary Net interest income decreased $1.0 million, or 9.3 percent, to $10.1 million for the three months ended March 31, 2024, when compared to $11.2 million for the three months ended March 31, 2023. The Company experienced an increase in interest income of $4.8 million, or 31.0 percent, during the first quarter of 2024 compared to the first quarter of 2023, offset by a $5.8 million increase in interest expense during the first quarter of 2024 primarily due to the prolonged environment of elevated market interest rates for deposits across the Bank's market areas and increased competition from bank and non-bank alternatives, as well as the migration of a portion of the Company's deposit balances from noninterest and low interest bearing deposits to higher-cost savings, money market, and time deposits during the period. The increase in interest income during the three months ended March 31, 2024 compared to the prior year period was primarily driven by a $4.2 million increase in interest income on the Company's loan portfolio due to increased yields and volume, as well as an increase of $588 thousand of interest income from the Company's investment securities portfolio and interest earnings on cash balances held with the Federal Reserve Bank of Richmond (the "FRB") and correspondent banks. Noninterest income increased $54 thousand, or 4.8 percent, for the three months ended March 31, 2024 compared to the same three-month period in 2023 while noninterest expense increased $261 thousand, or 3.1 percent. The increase was driven primarily by an increase of $141 thousand in occupancy expense, or 15.8 percent, over the respective periods, followed by an increase in data processing expense of $112 thousand, or 17.0 percent, during the first quarter of 2024 when compared to the first quarter of 2023. Compensation and benefits expense increased $61 thousand or 1.2 percent overall, predominantly led by an increase of $124 thousand, or 49.0 percent in retirement expense, followed by an increase of $47 thousand, or 14.2 percent in group insurance expense for the three months ended March 31, 2024 when compared to the three months ended March 31, 2023. Other noninterest expense decreased $53 thousand or 3.1 percent when comparing the first quarter of 2024 to the first quarter of 2023, offset by an increase in regulatory assessments and compliance costs of $83 thousand, or 32.7 percent. Financial Performance Dollars in Thousands Except Per Share Data  Three Months Ended  March 31, December 31, September 30, June 30,  March 31, 2024 2023 2023 2023 2023 Interest Income      Loans $           17,194 $           16,324 $           15,186 $           14,122 $           13,015      Investments 2,971 3,092 2,964 2,648 2,383 Total Interest Income $           20,165 $           19,416 $           18,150 $           16,770 $           15,398 Interest Expense 10,048 8,781 7,776 6,440 4,241 Net Interest Income $           10,117 $           10,635 $           10,374 $           10,330 $           11,157 Provision for Loan Losses 175 400 - 180 175 Noninterest Income 1,180 1,165 1,166 1,481 1,126 Noninterest Expense 8,583 8,394 8,772 8,442 8,322 Income Before Taxes $             2,539 $             3,006 $             2,768 $             3,189 $             3,786 Provision for Income Taxes 532 813 579 676 662 Net Income $             2,007 $             2,193 $             2,189 $             2,513 $             3,124 Basic Earnings Per Share $               0.26 $               0.29 $               0.29 $               0.33 $               0.41 Diluted Earnings Per Share $               0.26 $               0.29 $               0.29 $               0.33 $               0.41 Weighed Average Shares Outstanding      Basic 7,606,024 7,605,854 7,546,086 7,545,922 7,546,566      Diluted 7,669,225 7,644,120 7,589,725 7,606,002 7,632,316 Total Shares Outstanding 7,606,823 7,605,854 7,605,854 7,596,779 7,596,779   Noninterest Income/Expense Dollars in Thousands  Three Months Ended  March 31, December 31, September 30, June 30, March 31, 2024 2023 2023 2023 2023 Noninterest Income   Service charges and fees $             138 $                138 $                142 $                389 $                128   Securities gains, net - - - - 3   Secondary mortgage income 184 190 137 225 196   Other income 858 837 887 867 799 Total noninterest income $          1,180 $             1,165 $             1,166 $             1,481 $             1,126