SouthState Bank Corp
For the period ended Dec 31, 2025. Filed Feb 20, 2026.
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FY2025 · Filed Feb 20, 2026
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Item 8. Report of Independent Registered Public Accounting Firm
Report of Independent Registered Public Accounting Firm
To the Shareholders and the Board of Directors of SouthState Bank Corporation
Opinion on Internal Control Over Financial Reporting
We have audited SouthState Bank Corporation and subsidiaries’ internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria). In our opinion, SouthState Bank Corporation and subsidiaries (the Company) maintained, in all material respects, effective internal control over financial reporting as of December 31, 2025, based on the COSO criteria.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 31, 2025 and 2024, the related consolidated statements of income, comprehensive income, changes in shareholders’ equity, and cash flows foreach of the three years in the period ended December 31, 2025, and the related notes and our report dated February 20, 2026 expressed an unqualified opinion thereon.
Basis for Opinion
The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects.
Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.
Definition and Limitations of Internal Control Over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
/s/ Ernst & Young LLP
Birmingham, Alabama
Report of Independent Registered Public Accounting Firm
To the Shareholders and the Board of Directors of SouthState Bank Corporation
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheets of SouthState Bank Corporation and subsidiaries (the Company) as of December 31, 2025 and 2024, the related consolidated statements of income, comprehensive income, changes in shareholders' equity and cash flows for each of the three years in the period ended December 31, 2025, and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2025, in conformity with U.S. generally accepted accounting principles.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated February 20, 2026 expressed an unqualified opinion thereon.** **
Basis for Opinion
These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.** **
Critical Audit Matters
The critical audit matters communicated below are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.
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| | | Allowance for credit losses |
| Description of the Matter | | As of December 31, 2025, the Company’s held for investment loan portfolio was $48.6 billion and the associated allowance for credit losses (“ACL”), inclusive of the reserve for unfunded commitments, was $654.8 million. The provision for credit losses was $119.8 million for the year ended December 31, 2025. As described in Notes 1 and 5 to the consolidated financial statements, the Company’s ACL recorded on the balance sheet reflects management’s best estimate of the portion of the amortized cost of loans and unfunded commitments that it does not expect to collect. Management considers the effects of past events, current conditions, and reasonable and supportable forecasts on the collectability of the loan portfolio. The ACL is measured on a collective pool basis when similar risk characteristics exist, and the Discounted Cash Flow method (“DCF”) is utilized and aggregated at the pool level. A probability of default (“PD”) and absolute loss given default (“LGD”) are applied to a projective model of the loan’s cash flow while considering prepayment and principal curtailment effects. Management considers the need to qualitatively adjust expected credit losses for information not already captured in the loss estimation model. |
| | | Auditing management’s ACL estimate and related provision for credit losses was complex due to the need for involvement of professionals with specialized skills and knowledge in evaluating the expected loss forecasting models, and due to subjectivity in evaluating management’s selection and weighting of economic forecast scenarios used during the reasonable and supportable period and the qualitative factors. |
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| How We Addressed the Matter in Our Audit | | We obtained an understanding, evaluated the design and tested the operating effectiveness of the Company’s internal controls over establishing the ACL, including controls that address: 1) the governance of the credit loss methodology, including management’s review and approval of the ACL; 2) the completeness and accuracy of key inputs and assumptions used in the models; 3) the selection and challenge of the economic forecasts, including the selected weightings of the economic forecasts applied by management; 4) the identification and measurement of qualitative factors, among others.With respect to expected loss forecasting models, with the support of our internal specialists, we evaluated the conceptual soundness of the model methodology and recalculated the model output on a sample basis. We also tested the appropriateness of key inputs and assumptions used in these models by agreeing a sample of inputs to supporting documentation. Regarding the reasonable and supportable economic forecasts used in the models, we evaluated the reasonableness of management’s selection and weighting of the forecast scenarios used, tested the completeness and accuracy of forecast data to supporting documentation and searched for and evaluated information that corroborated or contradicted the forecast.Regarding measurement of the qualitative factors, we evaluated the methodology applied and data utilized by management to estimate the appropriate level of the qualitative factors with the support of our internal specialists. We also considered if qualitative factors were consistent with external macroeconomic factors and current credit metrics. We evaluated the overall ACL amount, including model estimates and qualitative factors, and whether the recorded ACL appropriately reflects expected credit losses on the loan portfolio and unfunded credit commitments. We considered overall trends in credit quality, historical loss statistics, peer-bank information, and subsequent events and considered whether they corroborate or contradict the Company’s measurement of the ACL. |
| | | Business Combinations – Fair Value of Acquired Loans |
| Description of the Matter | | As described in Note 2 to the consolidated financial statements, the Company acquired Independent Bank Group, Inc. on January 1, 2025 and recognized $13 billion in fair value of acquired loans. To determine the fair value of acquired loans, management used a discounted cash flow approach that estimated the present value of contractual and expected cash flows, adjusted for expected credit losses and market-based discount rates. Auditing management’s fair value estimate of the acquired loans was complex due to the need for involvement of professionals with specialized skills and knowledge, and due to subjectivity in evaluating management’s credit loss and discount rate assumptions used in the valuation methodology. |
| How We Addressed the Matter in Our Audit | | We obtained an understanding, evaluated the design, and tested the operating effectiveness of the Company’s internal controls over estimating the fair value of the acquired loans, including the selection of the valuation methodology, developing credit loss expectations and determining the discount rate to be used in the discounted cash flow methodology, and testing completeness and accuracy of key inputs used in the valuation, including loan data.With the support of our internal specialists, we evaluated management’s valuation methodology and key assumptions used to estimate the fair value of the acquired loans. We tested the determination and application of the credit loss and discount rate assumptions by comparing management’s selected assumptions to independently developed ranges based on internal and third-party market data. Additionally, with the support of our internal specialists, we performed independent comparative calculations of the fair value adjustment to the acquired loans on a sample basis. |
/s/ Ernst & Young LLP
We have served as the Company’s auditor since 2023.
Birmingham, Alabama
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