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CORRESP
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corresp

July 13, 2010

Mr. Hugh West

Branch Chief

United States Securities and Exchange Commission

Washington, D.C. 20549

    RE:

    Seacoast Banking Corporation of Florida

Form 10-K for the Fiscal Year Ended December 31, 2009

Form 10-Q for the Fiscal Year Ended March 31, 2010

File No. 000-13660

Dear Mr. West:

SEC Comment

Management’s Discussion and Analysis

Nonperforming Assets, page 9

    1.

    Please revise your future filings to quantify the types of concessions made (e.g. rate
reductions, payment extensions, forgiveness of principal, forbearance or other actions)
concerning troubled debt restructurings and discussion of your success with the different type
of concessions. Show us what your disclosure will look like in your response.

Response

Troubled debt restructurings (“TDRs”) at December 31, 2009 by type of concession change and
delinquency after restructuring included:

    TDRs 30 days and

    (In thousands)

    greater past due

    Rate reductions

    $
    16,854

    $
    0

    Maturity extended

    76,238

    12,613

    Forgiveness of principal

    2,688

    88

    Other

    275

    275

    $
    96,055

    $
    12,976

It is the Company’s policy to only enter into TDRs after a full underwriting of the loan customer
with current credit information. The Company’s experience with redefaults to date has been limited
for all type of concessions. However, given the continued economic stress it is probable that some
TDRs will likely redefault in the future. The Company will revise future filings to include this
information.

SEC Comment

    2.

    We note your disclosure on page 55 that you modify certain loans that are not considered
TDRs. Please describe the types of modifications performed and explain your rationale for not
classifying them as TDRs. In this regard, specifically tell us whether you have performed any
loan modifications that you consider to be short term in nature (and provide your definition
of short term) and therefore concluded that TDR classification was not required.

Response

Loans may be modified from time-to-time to retain borrowers that meet the Bank’s credit quality
goals. It is the Company’s policy to classify a loan renewal or modification as a TDR when the
customer is experiencing financial difficulties and a concession is granted that would not
otherwise be considered. This determination is made after full and complete current financial
information is obtained. Modifications that are not TDRs may include an interest rate reduction
that reflects a general decline in market interest rates, an extension of maturity or a minor
payment schedule adjustment that aligns with Company policy and reflects terms that are available
in the market at the time. Therefore, renewals and modifications that are in accordance with
current market conditions and loan policy requirements where no concession is granted are not
classified as TDRs. The Company will revise future filings to include this information.

SEC Comment

    3.

    Please tell us and revise your future filings to disclose whether you have performed any CRE
workouts whereby an existing loan was restructured into multiple new loans (i.e., A Note/B
Note structure). To the extent that you have performed these types of CRE workouts, please
provide us with and revise your future filings to disclose the following:

    •

    Quantify the amount of loans that have been restructured using this type of workout
strategy in each period presented;

    •

    Discuss the benefits of this workout strategy, including the impact on interest
income and credit classification;

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    •

    Discuss the general terms of the new loans and how the A note and B note differ,
particularly whether the A note is underwritten in accordance with your customary
underwriting standards and at current market rates;

    •

    Clarify whether the B note is immediately charged-off upon restructuring. If not,
clarify whether you combine the restructured notes in your evaluation of whether the
notes should be returned to accrual status;

    •

    Confirm that the A note is classified as a TDR and explain your policy for removing
such loans from TDR classification; and

    •

    Clarify your policy for returning the A note to accrual status, including how you
consider the borrower’s payment performance prior to the restructuring.

Response

To date, the use of multiple note structures to resolve problem loans has not been material, but
use of this structure could increase in future periods. At December 31, 2009 the Company had only one
A/B note restructuring for a total of $14 million. The Company does not believe this to be
material to its TDR disclosures, but will provide in future filings the disclosures suggested if
this type of restructuring becomes material in the future.

SEC Comment

    4.

    Please tell us and consider revising your future filings to disclose, whether you have
noticed an increase in any loan categories such as commercial real estate or construction
loans that have been extended at maturity for which you have not considered the loans to be
impaired due to the existence of guarantees. If so, provide us with the following information
and consider enhancing your disclosure in future filings accordingly:

    •

    The types of extensions being made, whether loan terms are being adjusted from the
original terms, and whether you consider these types of loans as collateral-dependent;

    •

    To the extent you extend commercial loans at or near maturity at the existing loan
rate due to the existence of a guarantee, tell us how you consider whether it is a
troubled debt restructuring;

    •

    In detail, how you evaluate the financial wherewithal of the guarantor, addressing
the type of financial information reviewed, how current and objective the information
reviewed is, and how often the review is performed;

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    •

    How many times you have sought performance under the guarantee discussing the
extent of the successes. As part of your response, discuss the decision making
process you go through in deciding whether to pursue the guarantor and whether there
are circumstances you would not seek to enforce the guarantee; and

    •

    Quantify the dollar amount of commercial loans in which your carrying value is in
excess of the appraised value but not considered impaired due to the existence of
guarantees.

Response

Upon maturity of our loans, each loan is evaluated based on current polices, credit quality
expectations, loan-to-value guidelines and offering of and capacity of guarantors, endorsers and
co-makers. The evaluation of the borrower and all parties to the transaction includes full and
appropriate financial disclosure and of all assets, and analysis of direct debts and all contingent
liabilities.

The Bank has not seen an increase in any loan category that has been extended at maturity, which
was considered not impaired due to the existence of guarantees. There were only two loans totaling
$1.69 million that were extended at maturity for which the carrying value of the loan was in excess
of the appraised value of the collateral, but where the loan was considered not impaired given the
existence of guarantor support.

If there is an increase in this type of extensions in the future, we will add the suggested
disclosures to our future filings.

SEC Comment

Notes to Consolidated Financial Statements

Note R — Fair Value, page 81

    5.

    Please address and disclose the following as it relates to your appraisal policies:

    •

    When the Company does not have a new appraisal on file, describe in more detail the
procedures performed by your Credit Officers and Special Assets Officers in
determining whether the assumptions reflected in these original appraisals are
reflective of current market conditions, particularly for those appraisals that are
more than a year old;

    •

    Describe the procedures performed at each balance sheet date to determine the fair
value of collateral-dependent impaired loans and OREO. Tell us how you define
collateral dependent loans. In determining the fair value address whether you make
adjustments to original appraisals to take into consideration current market
conditions. If so, describe the types of adjustments made. Alternatively, if you
perform an internal valuation to estimate fair value,

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    please describe the valuation approaches used, the significant assumptions used in each
model, and if multiple valuation approaches are used, the relative weighting of each
model. Clarify whether you make any adjustments to current appraisals and if so,
describe the types of adjustments made and the reasons for such adjustments;

    •

    When you receive new appraisals, describe the type of appraisals received, such as
“retail value” or “as is value”;

    •

    Address how partially charged-off loans measured for impairment based on the
collateral value are classified and accounted for subsequent to receiving an updated
appraisal. For example, disclose whether the loans are returned to performing status
or whether they remain as nonperforming;

    •

    Address the typical timing surrounding the recognition of a loan as nonaccrual and
recording of any provision or charge-off;

    •

    Address the procedures performed between receipt of updated appraisals to ensure
impairment of loans measured for impairment based on collateral value are measured
appropriately; and

    •

    Address how you determine the amount to charge-off.

Response

All impaired loans are reviewed quarterly to determine if valuation adjustments are necessary based
on known changes in the market and/or the project assumptions. When necessary, the “As Is”
appraised value may be adjusted based on more recent appraisal assumptions received by the Company
on other similar properties, the tax assessed market value, comparative sales and/or an internal
valuation. If an updated assessment is deemed necessary and an internal valuation cannot be made,
an external “As Is” appraisal will be obtained. If the “As Is” appraisal does not appropriately
reflect the current fair market value, in the Company’s opinion, a specific reserve is established
and/or the loan is written down to the current fair market value.

Collateral dependant, impaired loans are solely dependant on the liquidation of the collateral for
repayment. All OREO / REPO loans are reviewed quarterly to determine if valuation adjustments are
necessary based on known changes in the market and/or project assumptions. When necessary, the “As
Is” appraisal is adjusted based on more recent appraisal assumptions received by the Company on
other similar properties, the tax assessment market value, comparative sales and/or an internal
valuation is performed. If an updated assessment is deemed necessary, and an internal valuation
cannot be made, an external appraisal will be requested. Upon receipt
of the “As Is” appraisal a charge-off is
recognized for the difference between the loan amount and
its current fair market value.

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“As Is” values are used to measure fair market value on impaired loans, OREO and REPOs.

Any loan that is partially charged-off remains in nonperforming status until it is paid off
regardless of current valuation of the loan.

In accordance with regulatory reporting requirements, loans are placed on non-accrual following the
Retail Classification of Loan interagency guidance. Typically loans 90 days or more past due are
reviewed for impairment, and bank regulatory if deemed impaired, are placed on non-accrual. Once
impaired, the current fair market value of the collateral is assessed and a specific reserve and/or
charge-off taken. Quarterly thereafter, the loans carrying value is analyzed and any changes are
appropriately made as described above.

Upon receipt of an appraisal, an appraisal review is performed and a specific reserve or charge-off
is processed, if warranted.

The Company acknowledges that:

    •

    the Company is responsible for the adequacy and accuracy of the disclosure in the
filing;

    •

    staff comments or changes to disclosure in response to staff comments do not
foreclose the Commission from taking any action with respect to the filing; and

    •

    the Company may not assert staff comments as a defense in any proceeding initiated
by the Commission or any person under the federal securities laws of the United
States.

Please feel free to contact me if you have any further comments or questions.

Very Truly Yours,

/s/
William R.
Hahl

William R. Hahl

Executive Vice President/

Chief Financial Officer

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