I'm confident that South State Bank (NASDAQ:SSB) is going to be a meaningfully larger bank in three to five years' time, and I'm reasonably confident that it will not compromise its quality to get there. While management already has a credible plan in place to drive above-average growth by organic means, they have also made it clear that M&A is going to continue to be a meaningful factor in the company's long-term growth plans.
South State is at an interesting point in its growth story. The bank is about to break through the $10 billion threshold in assets and that's going to increase its regulatory/compliance costs, but I expect additional deals in growth markets along the I-85 corridor and southeastern coast will be coming and will help offset some of those costs with further growth. While South State Bank doesn't look cheap today, it's closer to its fair value than most and this would be a name I'd watch in the hopes of taking advantage of an eventual normalization in bank valuations.
South State Bank Pairing Organic Growth With A Growing Focus On M&A