CoastalSouth Bancshares, Inc. (NYSE: COSO)

CoastalSouth Bancshares, Inc. is a bank holding company headquartered in Atlanta, Georgia. Through its wholly owned subsidiary Coastal States Bank, a South Carolina state-chartered commercial bank, it provides a full range of banking products and services to businesses, real estate professionals, and consumers in the Lowcountry of South Carolina, nearby Savannah, Georgia, and the Atlanta, Georgia market.

The company generates revenue primarily through interest income from loans and fees from banking services. Its core lending activities include commercial and retail lending via its community bank, as well as four specialty lines of business: Senior Housing Lending, Marine Lending, Government Guaranteed Lending, and Mortgage Banker Finance. Revenue is also derived from deposit-related services and gains on the sale of government-guaranteed loans.

The company operates through the following segments: Community Bank, Senior Housing Lending, Marine Lending, Government Guaranteed Lending, and Mortgage Banker Finance.

• The Community Bank segment focuses on commercial and retail clients in the local markets of the Lowcountry of South Carolina, Savannah, Georgia, and the Atlanta, Georgia MSA. It provides traditional banking services including deposits, commercial loans, and small business lending through 11 branch locations.

• The Senior Housing Lending segment focuses on lending to operators across the spectrum of senior care, with an emphasis on assisted living. It provides low-leverage loans to experienced operators with strong track records, operating on a national basis within the United States.

• The Marine Lending segment focuses on consumer loans to high-net-worth borrowers secured by yachts and high-end sport fishing vessels. It operates through a correspondent lending model, originating super-prime consumer loans via a network of twelve national correspondent lenders.

• The Government Guaranteed Lending segment focuses on the origination of small business and other loans guaranteed by the SBA and USDA. It includes 7(a) and 504 loans under the SBA program, for which the bank has earned Preferred Lender status.

• The Mortgage Banker Finance segment focuses on mortgage warehouse lending to mortgage originators. It provides purchase and sale of originated single family mortgages to independent mortgage bankers, with loans typically remaining on the balance sheet for eight to ten calendar days prior to sale.

CoastalSouth Bancshares, Inc. positions itself as a community bank with scalable specialty lines of business, differentiating itself from larger national banks and smaller community banks. Its competitive advantages include an experienced management team with a history of successful acquisitions and business line development, a strong deposit market share in the Hilton Head MSA, and a disciplined underwriting approach that has maintained low net charge-offs. The company benefits from operating in high-growth markets in Georgia and South Carolina, where it is one of the largest remaining independent bank holding companies.

The company serves businesses, real estate professionals, and consumers in its primary markets of the Lowcountry of South Carolina, Savannah, Georgia, and Atlanta, Georgia. Its specialty lines of business serve clients nationwide, including senior housing operators, high-net-worth individuals seeking marine financing, small businesses utilizing SBA and USDA guarantees, and mortgage originators across the United States.