CenterState Bank : Third Quarter 2017 Earnings Release

FOR IMMEDIATE RELEASE

October 24, 2017

(all amounts are in thousands of dollars, except per share data, or unless otherwise noted)

WINTER HAVEN, FL. - October 24, 2017 - CenterState Bank Corporation (Nasdaq: CSFL) reported net income of

$22,050, or diluted earnings per share of $0.36, for the third quarter of 2017, as compared to net income of $15,384, or diluted earnings per share of $0.32, for the third quarter of 2016. Other highlights for the third quarter of 2017 include the following:

• On August 12, 2017, the Company signed two separate definitive merger agreements to acquire HCBF Holding Company, Inc. ("Harbor) and Sunshine Bancorp, Inc. ("Sunshine"). Upon completion of both mergers, the Company will become the largest community banking company headquartered in the state of Florida by assets, market capitalization, deposit market share and branch footprint(1). On a pro forma basis, the resulting company is expected to have $10 billion in assets based on June 30, 2017 financial information.

• On September 25, 2017, the Company announced its board of directors unanimously named Mark W. Thompson as President of its subsidiary bank, CenterState Bank, N.A.

• On September 10 and 11, 2017, Hurricane Irma impacted the entire state of Florida which resulted in:

  • Temporary reduction in the Bank's loan production of approximately $50 million from the previous two months

  • Additional loan loss provision by the Bank of approximately $750 thousand for potential credit losses

• Net loan growth in the third quarter equaled 3% annualized (4.5% annualized excluding purchase credit impaired ("PCI") loans). Net loan growth for the nine months ended September 30, 2017 equaled 9% annualized, excluding loans acquired from the Company's second quarter acquisitions of Platinum Bank Holding Company ("Platinum") and Gateway Financial Holdings of Florida, Inc. ("Gateway").

• Tax equivalent net interest margin ("NIM") (Non-GAAP(2)) increased to 4.26% for the current quarter, compared to 4.12% for the third quarter of 2016. Cost of deposits during the current quarter equaled 0.23%. Excluding the Gateway and Platinum deposit cost of 0.44%, cost of deposits equaled 0.18% during the current quarter compared to 0.18% in the third quarter of 2016.

  Three Months Ended

  September 30, 2017 Excluding Merger Related	June 30, 2017 Excluding Merger Related	September 30, 2016 Excluding Merger Related
  As Reported Expenses (3)	As Reported Expenses (3)	As Reported Expenses (3)
  Net income	$22,050 $22,050	$15,233 $22,002	$15,384 $15,375
  Return on average assets	1.29% 1.29%	0.95% 1.37%	1.22% 1.22%
  Return on average tangible common equity (Non-GAAP)(2)	14.7% 14.7%	11.0% 15.7%	15.0% 15.0%
  Earnings per share diluted	$0.36 $0.36	$0.26 $0.37	$0.32 $0.32
  Efficiency ratio (Non-GAAP)(2)	55.2% 55.2%	68.9% 57.0%	58.7% 58.7%

  Subsequent Event

• On October 19, 2017, The board of directors of the Company declared a quarterly cash dividend on its common stock of $0.06 per share. The dividend is payable on December 29, 2017 to shareholders of record as of December 15, 2017.

1. Based on publicly available data on S&P Global Market Intelligence for companies with less than $20 billion in assets.

2. See reconciliation tables starting on page 8, Explanation of Certain Unaudited Non-GAAP Financial Measures.

3. Merger-related expenses represent direct severance, system terminations, and legal and professional fees that are not duplicative of current operations. See reconciliation tables starting on page 8, Explanation of Certain Unaudited Non-GAAP Financial Measures.

   CONDENSED CONSOLIDATED INCOME STATEMENT (unaudited)

   Condensed consolidated income statements (unaudited) are shown below for the periods indicated.

   Three Months Ended Sept. 30, June 30, Mar. 31, Dec. 31, Sept. 30,	Nine Months Ended Sept. 30, Sept. 30,
   2017 2017 2017 2016 2016	2017 2016
   Interest income
   Loans	$59,122 $56,619 $44,249 $44,085 $41,445	$159,990 $119,540
   Investment securities	7,048 7,289 6,203 5,531 5,746	20,540 17,298
   Federal Funds sold and other	887 836 651 539 512	2,374 1,672
   Total interest income	67,057 64,744 51,103 50,155 47,703	182,904 138,510
   Interest expense
   Deposits	3,178 2,619 1,897 1,892 1,821	7,694 5,042
   Securities sold under agreement to repurchase	80 47 30 23 25	157 80
   Federal Funds purchased	866 728 537 393 240	2,131 761
   Corporate debentures	347 333 318 313 298	998 836
   Interest expense	4,471 3,727 2,782 2,621 2,384	10,980 6,719
   Net interest income	62,586 61,017 48,321 47,534 45,319	171,924 131,791
   Provision for loan losses	1,096 1,899 995 2,266 1,275	3,990 2,696
   Net interest income after loan loss provision	61,490 59,118 47,326 45,268 44,044	167,934 129,095

   Correspondent banking and capital markets division income	7,213	8,062	6,449	8,091	7,528	21,724	25,594
   Gain on sale of securities available for sale	-	-	-	-	13	-	13
   FDIC- IA (negative accretion) (1)	-	-	-	-	-	-	(1,166)
   FDIC- revenue (1)	-	-	-	-	-	-	96
   Gain on early extinguishment of debt	-	-	-	-	-	-	308
   All other non interest income	9,528	8,912	8,053	9,065	8,140	26,493	22,368
   Total non interest income	16,741	16,974	14,502	17,156	15,681	48,217	47,213
   Correspondent banking and capital markets division-expense	5,304	5,544	4,746	5,987	5,456	15,594	17,397
   Credit related expenses	527	876	655	624	187	2,058	1,157
   Merger related expenses	-	9,458	870	272	-	10,328	11,172
   Termination of FDIC loss share agreements (1)	-	-	-	-	-	-	17,560
   All other non interest expense	38,791	38,931	31,772	31,301	30,752	109,494	89,011
   Total non interest expense	44,622	54,809	38,043	38,184	36,395	137,474	136,297
   Income before income tax	33,609	21,283	23,785	24,240	23,330	78,677	40,011
   Income tax provision	11,559	6,050	7,185	8,213	7,946	24,794	13,697
   Net income	$22,050	$15,233	$16,600	$16,027	$15,384	$53,883	$26,314
   Net income allocated to common shares	$22,003	$15,200	$16,559	$15,970	$15,324	$53,762	$26,210
   Earnings per share - Basic	$0.37	$0.26	$0.33	$0.33	$0.32	$0.95	$0.55
   Earnings per share - Diluted	$0.36	$0.26	$0.32	$0.33	$0.32	$0.94	$0.55
   Dividends per share	$0.06	$0.06	$0.06	$0.04	$0.04	$0.18	$0.08
   Average common shares outstanding (basic)	59,907	58,307	50,632	47,870	47,821	56,316	47,254
   Average common shares outstanding (diluted)	61,115	59,370	51,408	48,800	48,603	57,330	47,955
   Common shares outstanding at period end	60,053	60,003	51,126	48,147	48,017	60,053	48,017
   Effective tax rate	34.39%	28.43%	30.21%	33.88%	34.06%	31.51%	34.23%

4. In February 2016, the Company terminated all existing loss share agreements with the FDIC. As a result, the Company wrote off the remaining indemnification asset and the claw back liability, received cash from the FDIC, and recognized a net loss on the transaction of approximately $17,560 during the first quarter of 2016.

CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited)

Presented below are condensed consolidated balance sheets for the periods indicated.

Ending Balance

Condensed Consolidated Balance Sheets	Sept. 30, 2017	June 30, 2017	Mar. 31, 2017	Dec. 31, 2016	Sept. 30, 2016
Assets
Cash and due from banks	$119,233	$87,277	$65,114	$66,368	$37,460
Fed funds sold and Fed Res Bank deposits	182,996	211,037	214,369	109,286	161,406
Trading securities	2,973	1,934	-	12,383	2,166
Investment securities:
Available for sale	866,657	868,334	819,352	740,702	761,648
Held to maturity	237,874	238,798	243,812	250,543	263,692
Total investment securities	1,104,531	1,107,132	1,063,164	991,245	1,025,340
Loans held for sale	12,243	8,959	2,637	2,285	2,333
Loans:
Originated loans	2,756,847	2,610,859	2,397,021	2,250,631	2,069,272
Acquired loans	1,760,745	1,856,310	946,925	993,192	1,027,922
PCI loans	163,975	179,364	176,058	185,924	197,288
Total gross loans	4,681,567	4,646,533	3,520,004	3,429,747	3,294,482
Allowance for loan losses	(31,828)	(30,132)	(27,819)	(27,041)	(25,499)
Loans, net of allowance	4,649,739	4,616,401	3,492,185	3,402,706	3,268,983
Premises and equipment, net	141,605	140,820	115,400	114,815	114,567
Goodwill	257,683	257,683	106,028	106,028	105,492
Core deposit intangible	25,140	26,217	14,785	15,510	16,267
Bank owned life insurance	145,755	115,234	99,065	98,424	97,767
OREO	5,904	6,422	7,201	7,090	9,005
Deferred income tax asset, net	56,160	58,841	56,792	63,208	58,614
Other assets	118,899	129,522	92,256	89,211	115,112
Total Assets	$6,822,861	$6,767,479	$5,328,996	$5,078,559	$5,014,512

Liabilities and Stockholders' Equity

Deposits:

Non-interest bearing	$1,915,662	$1,926,047	$1,585,963	$1,426,624	$1,406,030
Interest bearing	996,861	990,242	893,945	917,004	814,123
Total checking accounts	2,912,523	2,916,289	2,479,908	2,343,628	2,220,153
Money market accounts	1,156,217	1,178,109	910,056	900,532	903,697
Savings deposits	511,286	519,964	384,202	362,947	352,547
Time deposits	845,444	861,093	522,957	545,437	579,537
Total deposits	$5,425,470	$5,475,455	$4,297,123	$4,152,544	$4,055,934
Federal funds purchased	335,531	256,611	268,377	261,986	258,329
Other borrowings	72,234	73,089	63,882	54,385	52,788
Other liabilities	80,004	72,066	65,213	57,187	94,690
Common stockholders' equity	909,622	890,258	634,401	552,457	552,771
Total Liabilities and
Stockholders' Equity	$6,822,861	$6,767,479	$5,328,996	$5,078,559	$5,014,512

LOANS

Total loans increased $35,034 during the quarter, for an annualized growth rate of approximately 3%. Net loan growth for the nine months ended September 30, 2017 equaled 9% annualized, excluding loans acquired from second quarter acquisitions of Platinum and Gateway. The loan to deposit ratio increased to 86% from 85% in the prior quarter, and from 81% in the same quarter in 2016.

DEPOSITS

Total deposits decreased by $49,985, or approximately 4% on an annualized basis, during the current quarter. The decrease in deposits during the current quarter was mainly attributable to a temporary decline in balances of title companies and attorneys and seasonality. Total checking account balances represent 54% of total deposits. The overall cost of total deposits (i.e. includes non-interest bearing checking accounts) during the current quarter totaled 0.23%, compared to 0.20% in the previous quarter.

SELECTED CONSOLIDATED FINANCIAL DATA

The table below summarizes selected financial data for the periods presented.

Three Months Ended Nine Months Ended

Sept. 30, 2017	June 30, 2017	Mar. 31, 2017	Dec. 31, 2016	Sept. 30, 2016	Sept. 30, 2017	Sept. 30, 2016
Selected financial data
Return on average assets (annualized)	1.29%	0.95%	1.29%	1.25%	1.22%	1.17%	0.74%
Return on average equity (annualized)	9.71%	7.27%	10.92%	11.51%	11.21%	9.16%	6.70%
Return on average tangible equity (annualized) (Non-GAAP) (1)	14.68%	10.99%	14.06%	15.26%	14.95%	13.23%	12.80%
Efficiency ratio (tax equivalent) (Non-GAAP) (1)	55.2%	68.9%	59.3%	58.1%	58.7%	61.3%	65.6%
Dividend payout	16.7%	23.1%	18.8%	12.1%	12.5%	19.1%	21.8%
Loan / deposit ratio	86.3%	84.9%	81.9%	82.6%	81.2%
Stockholders' equity (to total assets)	13.3%	13.2%	11.9%	10.9%	11.0%
Common equity per common share	$15.15	$14.84	$12.41	$11.47	$11.51
Tangible common equity per common share (Non-GAAP) (1)	$10.42	$10.09	$10.03	$8.93	$8.96
Common tangible equity (to total tangible assets) (Non-GAAP) (1)	9.6%	9.3%	9.8%	8.7%	8.8%
Tier 1 capital (to average assets)	9.9%	10.0%	10.4%	9.1%	9.0%

(1) See reconciliation tables starting on page 8, Explanation of Certain Unaudited Non-GAAP Financial Measures.

NET INTEREST MARGIN ("NIM")

The Company's NIM decreased 12 basis points from 4.38% in the previous quarter to 4.26% during the current quarter due to a reduction in PCI loan accretion of 9 basis points ("bps"). The tax equivalent yield on new loan production increased by 13 basis points from 4.31% in the prior quarter to 4.44% during the current quarter.

The table below summarizes yields and costs by various interest earning asset and interest bearing liability account types for the current quarter, the previous calendar quarter and the same quarter last year.

Three Months Ended Sept. 30, 2017 June 30, 2017 Sept. 30, 2016 Average Interest Average Average Interest Average Average Interest Average Balance Inc/Exp Rate Balance Inc/Exp Rate Balance Inc/Exp Rate

Loans (1)	$4,492,543	$52,254	4.61%	$4,235,557	$48,922	4.63%	$3,037,333	$34,071	4.46%
PCI loans	170,924	7,696	17.86%	181,207	8,559	18.95%	207,406	7,795	14.95%
Taxable securities	926,367	5,648	2.42%	939,090	5,961	2.55%	900,514	4,693	2.07%
Tax -exempt securities (1)	196,988	2,082	4.19%	194,316	1,975	4.08%	134,576	1,581	4.67%
Fed funds sold and other	177,254	887	1.99%	180,261	836	1.86%	187,906	512	1.08%
Tot. interest earning assets (1)	$5,964,076	$68,567	4.56%	$5,730,431	$66,253	4.64%	$4,467,735	$48,652	4.33%
Non-interest earnings assets	796,143	726,950	535,632
Total Assets	$6,760,219	$6,457,381	$5,003,367
Interest bearing deposits	$3,507,381	$3,178	0.36%	$3,324,382	$2,619	0.32%	$2,678,638	$1,821	0.27%
Fed funds purchased	257,967	819	1.26%	253,851	692	1.09%	181,037	238	0.52%
Other borrowings	61,149	127	0.82%	56,414	83	0.59%	28,847	27	0.37%
Corporate debentures	26,103	347	5.27%	26,045	333	5.13%	25,852	298	4.59%
Total interest bearing liabilities	$3,852,600	$4,471	0.46%	$3,660,692	$3,727	0.41%	$2,914,374	$2,384	0.33%
Non-interest bearing deposits	1,926,070	1,891,968	1,445,140
All other liabilities	81,057	64,668	97,830
Shareholders' equity	900,492	840,053	546,023

Total liabilities and shareholders'

equity $6,760,219 $6,457,381 $5,003,367

Net Interest Spread (1)	4.10%	4.23%	4.00%
Net Interest Margin (1)	4.26%	4.38%	4.12%
Cost of Total Deposits	0.23%	0.20%	0.18%

(1) Tax equivalent yield (Non-GAAP); see reconciliation tables starting on page 8, Explanation of Certain Unaudited Non-GAAP Financial Measures.