Ameris Bancorp (ABCB) Q4 2025: Tangible Book Value Jumps 14%, Deposit Mix Remains Core Growth Lever
Ameris Bancorp capped 2025 with record profitability, achieving double-digit tangible book value growth and strong operating leverage, while navigating competitive deposit markets and CRE runoff. Margin expansion and disciplined expense control signal durable core profitability, but management flags deposit cost pressure and a return to normalized loan growth as key watchpoints for 2026. Investors should monitor the bank’s ability to sustain core deposit momentum as Southeastern market disruption and competition intensify.
Summary
- Deposit Mix Strategy: Relationship-focused core deposit growth remains the bank’s primary funding and margin driver.
- Efficiency Ratio Gains: Operating leverage from expense discipline supports above-peer profitability and capital accretion.
- Margin Compression Ahead: Management signals near-term NIM pressure as deposit costs rise with loan growth in 2026.
Performance Analysis
Ameris Bancorp delivered record net income for 2025, with full-year diluted EPS up 15% and tangible book value per share rising 14.5%. Core profitability was underpinned by 6% revenue growth and a 1% decline in expenses, pushing the full-year efficiency ratio to 50%, a material improvement from 53.2% last year. Net interest income (NII) grew over 10% year-over-year, as the net interest margin (NIM) expanded 23 basis points to 3.79% for the year, with Q4 NIM reaching 3.85%.
Loan production surged to $2.4 billion in Q4, up 16% sequentially, though net loan growth was muted by elevated CRE payoffs—management estimates normalized payoffs would have driven loan growth toward double digits. Asset quality metrics remained robust, with net charge-offs at 18 basis points for the year and the reserve ratio stable at 1.62% of loans. Core deposits, especially non-interest-bearing (NIB) balances, continued to anchor funding, representing 29% of total deposits at year-end despite typical Q4 seasonality. Brokered deposits were stable at 5% of total deposits.
- Operating Leverage Expansion: Positive operating leverage came from expense discipline as revenues outpaced costs, driving efficiency ratio improvement.
- CRE Payoff Volatility: High commercial real estate paydowns reduced net loan growth but signaled a healthy regional economy.
- Deposit Funding Resilience: Relationship banking and treasury management investments fueled NIB deposit growth and margin stability.
Non-interest income dipped in Q4 due to mortgage seasonality and MSR valuation, but annual adjusted non-interest income was up modestly year-over-year. The mortgage segment saw lower profitability due to a shift toward wholesale production and lower gain-on-sale margins, though expenses flexed down accordingly.
Executive Commentary
"We continue to operate at a high level of consistent core profitability while remaining focused on capital returns and accretive growth to enhance our shareholder value. We're positioned extremely well going into 2026, both from a growth and profitability level."
Palmer Proctor, Chief Executive Officer
"Although we have positioned ourselves to be mostly neutral from an asset liability sensitivity perspective, we anticipate we could see some slight margin compression over the next few quarters due to the pressure on deposit costs. As we see loan growth increasing, we believe there will be additional deposit pressure as we fund that growth in 26."
Nicole Stokes, Chief Financial Officer
Strategic Positioning
1. Relationship Banking and Core Deposit Focus
Ameris prioritizes core deposit growth through relationship banking, leveraging both branch presence and treasury management capabilities. The bank’s incentive plans are structured to deepen customer relationships, not just increase headcount. This approach is evident in the steady growth of NIB and money market accounts, which management views as the foundation for sustainable margin and loan growth.
2. Efficiency and Capital Deployment Discipline
Expense management and capital returns are central to the bank’s strategy. Ameris reduced expenses even as revenues grew, enabling robust operating leverage. The bank remains opportunistic with share repurchases, buying back 2% of shares in 2025, and maintains strong capital ratios (CET1 at 13.2%, TCE at 11.4%), providing flexibility for organic growth and select buybacks.
3. Navigating Competitive Lending and Deposit Markets
While loan production hit a multi-year high, management notes that competition is intensifying, particularly on pricing. The bank resists relaxing credit structure standards and is selective about hiring, focusing on upgrading talent rather than expanding headcount. On deposits, Ameris prefers to pay existing relationships competitive rates rather than chase “hot money” with promotional pricing, aiming to preserve funding stability and margin.
4. Geographic and Segment Diversification
Exposure to high-growth Southeastern markets offers Ameris a tailwind relative to peers, as population and business migration benefit loan and deposit pipelines. Segments like premium finance and mortgage provide earnings diversification, though mortgage remains rate-sensitive and subject to seasonal swings.
5. Asset Quality and Credit Risk Management
Asset quality remains a strategic strength, with low net charge-offs and stable reserves. Management expects charge-offs to normalize in the 20–25 basis point range for 2026, reflecting prudent risk management amid a stable economic backdrop.
Key Considerations
Ameris enters 2026 with momentum, but faces a more competitive landscape for both loans and deposits. The bank’s ability to maintain core deposit growth, manage margin compression, and sustain expense discipline will be pivotal for continued outperformance.
Key Considerations:
- Core Deposit Growth as Margin Anchor: Sustaining NIB and relationship deposit gains is critical for funding loan growth and defending NIM as deposit competition rises.
- Expense Flexibility: Proven expense control provides a buffer against revenue volatility and supports capital return flexibility.
- CRE and Mortgage Volatility: Elevated CRE paydowns and mortgage segment cyclicality may create quarterly swings in loan growth and fee income.
- Capital Allocation Discipline: Strong capital position supports continued buybacks, but management remains selective based on valuation and market conditions.
Risks
Deposit cost inflation and competitive pricing pressure are likely to compress margins in 2026, especially as Ameris funds loan growth in hot Southeastern markets. Elevated CRE paydowns could recur, muting net loan growth. Mortgage income remains vulnerable to rate and mix shifts. Any deterioration in asset quality or a reversal in Southeastern economic momentum would challenge the bank’s core profitability narrative.
Forward Outlook
For Q1 2026, Ameris guided to:
- Efficiency ratio returning above 50% due to seasonal payroll taxes and 401K contributions
- Non-interest expense in the $154–$155 million range as a starting point
For full-year 2026, management maintained:
- Mid-single-digit loan and deposit growth targets
- Net charge-offs expected in the 20–25 basis point range
Management highlighted several factors that will shape results:
- Deposit growth will “govern” the pace of loan growth, especially in the core bank
- Margin compression is expected as deposit costs rise, but the bank remains asset/liability neutral
Takeaways
Ameris Bancorp’s 2025 performance demonstrates the power of disciplined operating leverage and relationship-driven deposit gathering, but the 2026 outlook is clouded by margin pressure and heightened deposit competition.
- Deposit Mix and Funding Stability: The bank’s ability to grow and retain core deposits will be the key determinant of margin and loan growth in a more competitive environment.
- Expense and Capital Flex Remain Strengths: Expense discipline and a strong capital base enable continued buybacks and growth investment without overextending risk.
- Watch for Margin Inflection: Investors should monitor quarterly NIM trends and deposit mix, as even modest compression could impact profitability given the current outperformance baseline.
Conclusion
Ameris Bancorp enters 2026 with strong capital, robust core profitability, and a proven deposit franchise, but faces a shifting landscape as deposit costs rise and competition intensifies. The bank’s success will hinge on its ability to sustain core deposit momentum and manage through margin compression while capitalizing on Southeastern market disruption.
Industry Read-Through
Ameris’s results underscore the importance of core deposit gathering and expense discipline for regional banks, especially as the industry faces rising funding costs and competitive lending markets. The emphasis on relationship banking and treasury management is becoming a key differentiator in defending margin and funding stability. Elevated CRE paydowns and mortgage cyclicality highlight the need for diversified revenue streams. For peers in high-growth regions, the ability to convert market disruption into sustainable deposit and loan growth will separate winners from laggards as the cycle matures.