Colony Bankcorp Reports Third Quarter 2020 Results

Company Release - 10/15/2020 4:05 PM ET

Company Declares Quarterly Cash Dividend of $0.10 Per Share

FITZGERALD, Ga.--(BUSINESS WIRE)-- Colony Bankcorp, Inc. (Nasdaq: CBAN) (“Colony” or the “Company”) today reported financial results for the third quarter of 2020.

Third Quarter 2020 Financial Highlights:

  • Net income of $3.1 million, or $0.33 per diluted share
  • Operating net income of $3.7 million, or $0.39 adjusted earnings per diluted share (see Non-GAAP reconciliation)
  • Total assets of $1.8 billion
  • Total loans, including loans held for sale, of $1.2 billion
  • $1.1 million provision for loan losses

The Company also announced that on October 15, 2020, the Board of Directors declared a quarterly cash dividend of $0.10 per share, to be paid on its common stock on November 13, 2020, to shareholders of record as of the close of business on October 30, 2020.

Commenting on the announcement, Heath Fountain, President and Chief Executive Officer, said, “In this quarter of continued significant economic disruption due to the global pandemic, we delivered strong results, while prudently managing risk, as we continued to work diligently to support our customers, communities and employees. Our diluted earnings per share increased 21% over the same period last year and a strong 42% over the sequential quarter. Our results reflect the continued benefit of diversifying our business model, with income before income taxes increasing 28% over the prior-year period and 42% over the sequential quarter. Exceptional growth in mortgage banking income as well as revenue contribution from our Small Business Specialty Lending Division give all of us at Colony confidence in the future of our business. Additionally, our loan deferral balances related to the pandemic decreased 89% from $113.4 million in the second quarter 2020 to $12.6 million at the end of the third quarter, with the hotel sector representing $7.6 million.

“Growth in net interest income before provision for loan losses for the quarter of 9% year over year was offset by acquisition-related expenses related to core deposit intangible amortization, as well as the write-down of the Thomaston branch, the sale of which will close at the end of the fourth quarter. Despite strong growth in our interest earnings assets, our net interest margin decreased 28 basis points to 3.34% compared with the year-earlier period due to the addition of lower yielding PPP loans offset by a decrease in our borrowing costs during the quarter and lower interest on the level of deposits on our balance sheets. For the nine months ending September 30, 2020, our net interest margin was flat compared to the same period last year.

“Noninterest income saw strong growth, increasing 88% in the third quarter 2020 over the same period last year as a result of our continued strategic efforts to diversify our revenue streams. Mortgage fee income increased to $2.6 million in the current quarter compared to $1.3 million in the third quarter of 2019 due to the increasing number of our customers refinancing in the lower interest rate environment. Mortgage fee income now represents 35% of total noninterest income. We also saw increases in interchange fees as well as gains on sales of SBA loans and other securities. This increase in noninterest income was partially offset by increases in noninterest expense, such as increases in salaries and employee benefits due to the additional headcount, increases in occupancy, equipment, information technology expenses, and an FHLB prepayment penalty.

“Despite our strong asset quality, we recorded a higher provision for loan and losses in the third quarter of 2020 of $1.1 million, a substantial increase from $214,000 in the third quarter of 2019 due to increases in our loan portfolio and the current challenging economic operating environment. Our allowance for loan losses now represents 1.00% of total loans outstanding, an increase from 0.69% in the year-earlier quarter and 0.92% on a sequential-quarter basis. Total nonperforming assets in the third quarter of 2020 is 0.68% of total assets, compared to 0.70% in the year-earlier quarter and 0.75% on a sequential-quarter basis.

“As a final thought, I would like to express my sincere appreciation to every Colony team member for their efforts and contributions in serving our customers during this crisis. While some of our competitors are retrenching, due to our strategic efforts to diversify our business lines, we are adding talented bankers and loan officers in our growing markets. Our expenditures in technological enhancements to stay connected to our customers and our efforts to protect our credit metrics allow us to continue to drive our business forward. As the largest community bank outside of Atlanta, I am excited for our future and believe we will continue to grow our market share in Georgia while staying true to our heritage as a community bank,” concluded Fountain.

Balance Sheet

  • Total assets were $1.8 billion at September 30, 2020, an increase of $244.1 million, or 16%, from $1.5 billion at December 31, 2019.
  • Increased loan production associated with the funding of approximately 1,700 PPP loans, which also generated much higher balances in our interest-bearing deposits with other banks as of September 30, 2020.
  • Total loans, including loans held for sale, were $1.16 billion, an increase of $178.6 million, or 18%, from $978.9 million at December 31, 2019.
  • Growth in loans was primarily a result of PPP loan production during the second quarter 2020, which totaled $137.8 million in gross PPP loans at September 30, 2020.
  • Total deposits were $1.42 billion, an increase of $122.7 million, or 9%, compared to total deposits of $1.29 billion at December 31, 2019.
  • Noninterest-bearing deposits increased $91.5 million, or 39%, compared to December 31, 2019, and is attributable to PPP-related deposits.
  • Colony’s participation in the PPP loan program resulted in an increase in borrowings, specifically through the Payroll Protection Program Liquidity Facility (“PPPLF”), which totaled $134.5 million at September 30, 2020.

Capital

  • Colony continues to maintain a strong capital position, with ratios that exceed regulatory minimums required to be classified as “well-capitalized.”
  • Preliminary tier one leverage ratio, tier one capital ratio, total risk-based capital ratio and common equity tier one capital ratio were 9.36%, 14.29%, 15.29% and 12.16%, respectively.

Third Quarter Results of Operations

  • Net interest income before provision for loan losses increased $1.2 million on a sequential-quarter comparison.
  • Net interest margin was down seven basis points on a sequential-quarter basis and 28 basis points compared with the year-earlier quarter due to lower yielding PPP loans combined with an increase in lower yielding highly liquid assets.
  • Increase in noninterest income of $2.7 million, or 56%, on a sequential-quarter comparison, primarily due to mortgage loan productions from the refinancing in the lower interest rate environment and gain on sale of securities and Small Business Lending (“SBA”) loans.
  • Increase in noninterest expenses of $2.9 million, or 22%, on a sequential-quarter comparison, driven by the write down of the Thomaston branch pending the sale later this year, FHLB prepayment penalties and salaries and compensation expense.

Asset Quality

  • Nonperforming assets totaled $11.8 million and $10.4 million at September 30, 2020 and 2019, respectively.
  • OREO and repossessed assets totaled $1.9 million at September 30, 2020, an increase of $1.1 million, or 140.8%, compared to the same quarter in 2019.
  • Net loan charge-offs were $375,000, or 0.13% of average loans, compared to $317,000 in the third quarter of 2019.
  • The loan loss reserve was $11.0 million, or 1.00% of total loans, on September 30, 2020, compared with $6.6 million, or 0.69% of total loans, at September 30, 2019

While nonperforming assets have increased year over year primarily as a result of increased traditional loan production, asset quality remains strong with overall improvement as of the third quarter of 2020 compared to previous quarter and year-over-year comparisons. The increase in the provision for loan losses was directly impacted by the current economic disruptions resulting from the COVID-19 pandemic crisis.

About Colony Bankcorp

Colony Bankcorp, Inc. is the bank holding company for Colony Bank. Founded in 1975 and headquartered in Fitzgerald, Georgia, Colony operates 33 locations throughout Georgia. The Homebuilder Finance Division helps the local construction industry with building and construction loans, and the Small Business Specialty Lending Division assists small businesses with government guaranteed loans. The Bank also helps its customers achieve their goal of home ownership through Colony Bank Mortgage. Colony’s common stock is traded on the NASDAQ Global Market under the symbol “CBAN.” For more information, please visit www.colony.bank. You can also follow the Company on Facebook or on Twitter @colony_bank.

Forward-Looking Statements

Certain statements contained in this press release that are not statements of historical fact constitute “forward-looking statements” within the meaning of, and subject to the protections of, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. In addition, certain statements may be contained in the Company’s future filings with the SEC, in press releases, and in oral and written statements made by or with the approval of the Company that are not statements of historical fact and constitute “forward-looking statements” within the meaning of, and subject to the protections of, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Examples of forward-looking statements include, but are not limited to: (i) projections and/or expectations of revenues, income or loss, earnings or loss per share, the payment or nonpayment of dividends, capital structure and other financial items; (ii) statement of plans and objectives of Colony Bankcorp, Inc. or its management or Board of Directors, including those relating to products or services; (iii) statements of future economic performance; (iv) statements regarding growth strategy, capital management, liquidity and funding, and future profitability; (v) statements regarding the potential effects of the COVID-19 pandemic on the Company’s business and financial results and conditions; and (vi) statements of assumptions underlying such statements. Words such as “believes,” “anticipates,” “expects,” “intends,” “targeted” and similar expressions are intended to identify forward-looking statements but are not the exclusive means of identifying such statements.

Prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve known and unknown risks and uncertainties. Factors that might cause such differences include, but are not limited to: the impact of the COVID-19 pandemic on the Company’s assets, business, cash flows, financial condition, liquidity, prospects and results of operations; potential increases in the provision for loan losses resulting from the COVID-19 pandemic; the Company’s ability to implement its various strategic and growth initiatives; competitive pressures among financial institutions increasing significantly; economic conditions, either nationally or locally, in areas in which the Company conducts operations being less favorable than expected; interest rate risk; legislation or regulatory changes which adversely affect the ability of the consolidated Company to conduct business combinations or new operations, including changes to statutes, regulations or regulatory policies or practices as a result of, or in response to COVID-19; adverse results from current or future litigation, regulatory examinations or other legal and/or regulatory actions, including as a result of the Company’s participation in and execution of government programs related to the COVID-19 pandemic; the failure to close the sale of the Thomaston branch and risks that the anticipated benefits from the sale of the Thomaston branch and the transactions with LBC Bancshares, Inc. and PFB Mortgage are not realized in the time frame anticipated or at all as a result of changes in general economic and market conditions or other unexpected factors or events. These and other factors, risks and uncertainties could cause the actual results, performance or achievements of the Company to be materially different from the future results, performance or achievements expressed or implied by such forward-looking statements. Many of these factors are beyond the Company’s ability to control or predict.

Forward-looking statements speak only as of the date on which such statements are made. These forward-looking statements are based upon information presently known to the Company’s management and are inherently subjective, uncertain and subject to change due to any number of risks and uncertainties, including, without limitation, the risks and other factors set forth in the Company’s filings with the Securities and Exchange Commission, the Company’s Annual Report on Form 10-K for the year ended December 31, 2019, under the captions “Cautionary Note Regarding Forward-Looking Statements” and “Risk Factors,” and in the Company’s quarterly reports on Form 10-Q and current reports on Form 8-K. The Company undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made, or to reflect the occurrence of unanticipated events. Readers are cautioned not to place undue reliance on these forward-looking statements.

Explanation of Certain Unaudited Non-GAAP Financial Measures

The measures entitled operating net income; adjusted earnings per diluted share; tangible book value per common share and operating efficiency ratio are not measures recognized under U.S. generally accepted accounting principles (GAAP) and therefore are considered non-GAAP financial measures. The most comparable GAAP measures are net income, diluted earnings per share, book value per common share and efficiency ratio, respectively.

Management uses these non-GAAP financial measures in its analysis of the Company's performance and believes these presentations provide useful supplemental information, and a clearer understanding of the Company's performance, and if not provided would be requested by the investor community. The Company believes the non-GAAP measures enhance investors' understanding of the Company's business and performance. These measures are also useful in understanding performance trends and facilitate comparisons with the performance of other financial institutions. The limitations associated with operating measures are the risk that persons might disagree as to the appropriateness of items comprising these measures and that different companies might calculate these measures differently.

These disclosures should not be considered an alternative to GAAP. The computations of operating net income; adjusted earnings per diluted share; tangible book value per common share and operating efficiency ratio and the reconciliation of these measures to noninterest expense, net income, diluted earnings per share, book value per common share and efficiency ratio are set forth in the table below.

 

Colony Bankcorp, Inc.

 

 

 

 

Reconciliation of Non-GAAP Measures

 

 

 

 

 

 

 

 

 

 

 

 

 

2020

 

2019

(dollars in thousands, except per share data)

 

Third
Quarter

 

Second
Quarter

 

First
Quarter

 

Fourth
Quarter

 

Third
Quarter

Operating net income reconciliation

 

 

 

 

 

 

 

 

 

 

Net income (GAAP)

 

$

3,099

 

 

$

2,214

 

 

$

1,603

 

 

$

2,756

 

 

$

2,518

 

Acquisition-related expenses

 

207

 

 

220

 

 

287

 

 

335

 

 

861

 

Thomaston building write down

 

582

 

 

 

 

 

 

 

 

 

Income tax benefit

 

(166

)

 

(46

)

 

(60

)

 

(70

)

 

(181

)

Operating net income

 

$

3,722

 

 

$

2,388

 

 

$

1,830

 

 

$

3,021

 

 

$

3,198

 

Weighted average diluted shares

 

9,498,783

 

 

9,498,783

 

 

9,498,783

 

 

9,494,859

 

 

9,494,771

 

Adjusted earnings per diluted share

 

$

0.39

 

 

$

0.25

 

 

$

0.19

 

 

$

0.32

 

 

$

0.34

 

 

 

 

 

 

 

 

 

 

 

 

Tangible book value per common share reconciliation

 

 

 

 

 

 

 

 

 

 

Book value per common share (GAAP)

 

$

14.78

 

 

$

14.59

 

 

$

14.35

 

 

$

13.74

 

 

$

13.65

 

Effect of goodwill and other intangibles

 

(1.96

)

 

(1.96

)

 

(2.06

)

 

(2.06

)

 

(2.04

)

Tangible book value per common share

 

$

12.82

 

 

$

12.63

 

 

$

12.29

 

 

$

11.68

 

 

$

11.61

 

 

 

 

 

 

 

 

 

 

 

 

Operating efficiency ratio calculation

 

 

 

 

 

 

 

 

 

 

Efficiency ratio (GAAP)

 

76.22

%

 

72.75

%

 

77.32

%

 

77.24

%

 

79.94

%

Acquisition-related expenses

 

(0.97

)

 

(1.20

)

 

(1.68

)

 

(1.92

)

 

(5.26

)

Thomaston building write down

 

(2.72

)%

 

%

 

%

 

%

 

%

Operating efficiency ratio

 

72.53

%

 

71.55

%

 

75.64

%

 

75.32

%

 

74.68

%

Colony Bankcorp, Inc.

Selected Financial Information

 

 

 

 

 

 

 

 

 

 

 

 

 

2020

 

2019

(dollars in thousands, except per share data)

 

Third
Quarter

 

Second
Quarter

 

First
Quarter

 

Fourth
Quarter

 

Third
Quarter

EARNINGS SUMMARY

 

 

 

 

 

 

 

 

 

 

Net interest income

 

$

13,848

 

 

$

13,541

 

 

$

12,705

 

 

$

12,992

 

 

$

12,656

 

Provision for loan losses

 

1,106

 

 

2,200

 

 

1,956

 

 

581

 

 

214

 

Non-interest income

 

7,554

 

 

4,843

 

 

4,432

 

 

4,412

 

 

4,030

 

Non-interest expense

 

16,313

 

 

13,375

 

 

13,250

 

 

13,496

 

 

13,358

 

Income taxes

 

884

 

 

595

 

 

328

 

 

571

 

 

597

 

Net income

 

3,099

 

 

2,214

 

 

1,603

 

 

2,756

 

 

2,517

 

PERFORMANCE MEASURES

 

 

 

 

 

 

 

 

 

 

Per common share:

 

 

 

 

 

 

 

 

 

 

Common shares outstanding

 

9,498,783

 

 

9,498,783

 

 

9,498,783

 

 

9,498,783

 

 

9,498,783

 

Weighted average basic shares

 

9,498,783

 

 

9,498,783

 

 

9,498,783

 

 

9,494,859

 

 

9,494,771

 

Weighted average diluted shares

 

9,498,783

 

 

9,498,783

 

 

9,498,783

 

 

9,494,859

 

 

9,494,771

 

Earnings per basic share

 

$

0.33

 

 

$

0.23

 

 

$

0.17

 

 

$

0.29

 

 

$

0.27

 

Earnings per diluted share

 

0.33

 

 

0.23

 

 

0.17

 

 

0.29

 

 

0.27

 

Adjusted earnings per diluted share

 

0.39

 

 

0.25

 

 

0.19

 

 

0.32

 

 

0.34

 

Cash dividends declared per share

 

0.10

 

 

0.10

 

 

0.10

 

 

0.075

 

 

0.075

 

Common book value per share

 

14.78

 

 

14.59

 

 

14.35

 

 

13.74

 

 

13.65

 

Tangible common book value per share

 

12.82

 

 

12.63

 

 

12.29

 

 

11.68

 

 

11.61

 

 

 

 

 

 

 

 

 

 

 

 

Performance ratios:

 

 

 

 

 

 

 

 

 

 

Net interest margin (a)

 

3.34

%

 

3.41

%

 

3.63

%

 

3.72

%

 

3.62

%

Return on average assets

 

0.70

 

 

0.52

 

 

0.42

 

 

0.73

 

 

0.67

 

Return on average total equity

 

8.80

 

 

6.47

 

 

4.79

 

 

8.47

 

 

7.86

 

Efficiency ratio

 

76.22

 

 

72.75

 

 

77.32

 

 

77.24

 

 

79.94

 

Operating efficiency ratio (b)

 

72.53

 

 

71.55

 

 

75.64

 

 

75.32

 

 

74.68

 

 

 

 

 

 

 

 

 

 

 

 

ASSET QUALITY

 

 

 

 

 

 

 

 

 

 

Nonperforming loans (NPLs)

 

$

9,926

 

 

$

11,459

 

 

$

10,130

 

 

$

9,179

 

 

$

9,572

 

Other real estate owned

 

1,875

 

 

1,769

 

 

847

 

 

1,320

 

 

775

 

Repossessed assets

 

11

 

 

17

 

 

19

 

 

13

 

 

8

 

Total nonperforming assets (NPAs)

 

11,812

 

 

13,245

 

 

10,996

 

 

10,512

 

 

10,355

 

Classified loans

 

21,388

 

 

20,619

 

 

23,093

 

 

21,084

 

 

20,103

 

Criticized loans

 

72,076

 

 

52,200

 

 

46,600

 

 

51,182

 

 

42,765

 

Net loan charge-offs

 

375

 

 

295

 

 

435

 

 

317

 

 

403

 

Allowance for loan losses to total loans

 

1.00

%

 

0.92

%

 

0.85

%

 

0.71

%

 

0.69

%

Allowance for loan losses to total NPLs

 

111.02

 

 

89.79

 

 

64.81

 

 

74.77

 

 

68.95

 

Allowance for loan losses to total NPAs

 

93.29

 

 

77.68

 

 

60.83

 

 

65.29

 

 

63.73

 

Net charge-offs to average loans

 

0.13

 

 

0.12

 

 

0.18

 

 

0.13

 

 

0.17

 

NPLs to total loans

 

0.90

 

 

1.03

 

 

1.13

 

 

0.95

 

 

1.00

 

NPAs to total assets

 

0.67

 

 

0.75

 

 

0.91

 

 

0.69

 

 

0.70

 

NPAs to total loans and other real estate owned

 

1.07

 

 

1.19

 

 

1.39

 

 

1.08

 

 

1.08

 

 

 

 

 

 

 

 

 

 

 

 

AVERAGE BALANCES

 

 

 

 

 

 

 

 

 

 

Total assets

 

$

1,766,717

 

 

$

1,702,902

 

 

$

1,516,191

 

 

$

1,503,521

 

 

$

1,492,852

 

Loans, net

 

1,130,231

 

 

1,016,787

 

 

974,614

 

 

961,756

 

 

942,356

 

Deposits

 

1,417,724

 

 

1,384,739

 

 

1,293,784

 

 

1,278,987

 

 

1,272,561

 

Total stockholders’ equity

 

139,721

 

 

137,213

 

 

134,304

 

 

130,217

 

 

128,172

 

(a) Computed using fully taxable-equivalent net income.

(b) Non-GAAP measure - see “Explanation of Certain Unaudited Non-GAAP Financial Measures” for more information and reconciliation to GAAP

Colony Bankcorp, Inc.

Average Balance Sheet and Net Interest Analysis

(dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended September 30,

 

2020

 

2019

 

Average
Balances

 

Income/
Expense

 

Yields/
Rates

 

Average
Balances

 

Income/
Expense

 

Yields/
Rates

Assets

 

 

 

 

 

 

 

 

 

 

 

Interest-earning assets:

 

 

 

 

 

 

 

 

 

 

 

Loans, net of unearned income 1

$

1,140,487

 

 

$

13,809

 

 

4.80

%

 

$

956,150

 

 

$

13,699

 

 

5.68

%

Investment securities, taxable

339,094

 

 

1,644

 

 

1.92

%

 

391,117

 

 

2,328

 

 

2.36

%

Investment securities, tax-exempt 2

26,916

 

 

130

 

 

1.92

%

 

1,615

 

 

13

 

 

3.11

%

Deposits in banks and short term investments

151,508

 

 

52

 

 

0.14

%

 

43,951

 

 

206

 

 

1.86

%

Total interest-earning assets

1,658,005

 

 

15,635

 

 

3.74

%

 

1,392,833

 

 

16,246

 

 

4.63

%

Noninterest-earning assets

108,712

 

 

 

 

 

 

99,613

 

 

 

 

 

Total assets

$

1,766,717

 

 

 

 

 

 

$

1,492,446

 

 

 

 

 

Liabilities and stockholders' equity

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

Interest-earning demand and savings

$

793,831

 

 

$

324

 

 

0.16

%

 

$

672,633

 

 

$

1,260

 

 

0.74

%

Other time

295,559

 

 

820

 

 

1.10

%

 

379,873

 

 

1,555

 

 

1.62

%

Total interest-bearing deposits

1,089,390

 

 

1,144

 

 

0.42

%

 

1,052,506

 

 

2,815

 

 

1.06

%

Federal Home Loan Bank advances

28,587

 

 

159

 

 

2.20

%

 

48,565

 

 

269

 

 

2.20

%

Paycheck Protection Program Liquidity Facility

134,500

 

 

118

 

 

0.35

%

 

 

 

 

 

%

Other borrowings

38,289

 

 

273

 

 

2.83

%

 

39,498

 

 

458

 

 

4.60

%

Total other interest-bearing liabilities

201,376

 

 

550

 

 

%

 

88,063

 

 

727

 

 

3.27

%

Total interest-bearing liabilities

1,290,766

 

 

1,694

 

 

0.52

%

 

1,140,569

 

 

3,542

 

 

1.23

%

Noninterest-bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

Demand deposits

$

328,334

 

 

 

 

 

 

$

219,718

 

 

 

 

 

Other liabilities

7,896

 

 

 

 

 

 

3,987

 

 

 

 

 

Stockholders' equity

139,721

 

 

 

 

 

 

128,172

 

 

 

 

 

Total noninterest-bearing liabilities and stockholders' equity

475,951

 

 

 

 

 

 

351,877

 

 

 

 

 

Total liabilities and stockholders' equity

$

1,766,717

 

 

 

 

 

 

$

1,492,446

 

 

 

 

 

Interest rate spread

 

 

 

 

3.22

%

 

 

 

 

 

3.40

%

Net interest income

 

 

$

13,941

 

 

 

 

 

 

$

12,704

 

 

 

Net interest margin

 

 

 

 

3.34

%

 

 

 

 

 

3.62

%

_________________________

1The average balance of loans includes the average balance of nonaccrual loans. Income on such loans is recognized and recorded on the cash basis. Taxable-equivalent adjustments totaling $66,000 and $46,000.

2Taxable-equivalent adjustments totaling $27,000 and $3,,000 three months period ended September 30, 2020 and 2019, respectively, are included in tax-exempt interest on investment securities. The adjustments are based on federal tax rate of 21% with appropriate reductions for the effect of disallowed interest expense incurred in carrying tax-exempt obligations.

 

Nine Months Ended September 30,

 

2020

 

2019

 

Average
Balances

 

Income/
Expense

 

Yields/
Rates

 

Average
Balances

 

Income/
Expense

 

Yields/
Rates

Assets

 

 

 

 

 

 

 

 

 

 

 

Interest-earning assets:

 

 

 

 

 

 

 

 

 

 

 

Loans, net of unearned income 3

$

1,071,908

 

 

$

40,923

 

 

5.09

%

 

$

868,579

 

 

$

36,566

 

 

5.61

%

Investment securities, taxable

336,446

 

 

5,391

 

 

2.13

%

 

381,200

 

 

7,040

 

 

2.46

%

Investment securities, tax-exempt 4

12,319

 

 

184

 

 

1.99

%

 

1,939

 

 

48

 

 

3.28

%

Deposits in banks and short term investments

132,496

 

 

384

 

 

0.39

%

 

53,589

 

 

810

 

 

2.01

%

Total interest-earning assets

1,553,169

 

 

46,882

 

 

4.02

%

 

1,305,307

 

 

44,464

 

 

4.54

%

Noninterest-earning assets

107,015

 

 

 

 

 

 

78,202

 

 

 

 

 

Total assets

$

1,660,184

 

 

 

 

 

 

$

1,383,509

 

 

 

 

 

Liabilities and stockholders' equity

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

Interest-earning demand and savings

$

762,906

 

 

$

1,667

 

 

0.29

%

 

$

620,731

 

 

$

3,234

 

 

0.69

%

Other time

313,834

 

 

3,099

 

 

1.32

%

 

362,651

 

 

4,335

 

 

1.59

%

Total interest-bearing deposits

1,076,740

 

 

4,766

 

 

0.59

%

 

983,382

 

 

7,569

 

 

1.03

%

Federal Home Loan Bank advances

36,858

 

 

626

 

 

2.26

%

 

43,868

 

 

775

 

 

2.35

%

Paycheck Protection Program Liquidity Facility

78,081

 

 

205

 

 

0.35

%

 

 

 

 

 

%

Other borrowings

38,591

 

 

962

 

 

3.32

%

 

32,515

 

 

1,127

 

 

4.62

%

Total other interest-bearing liabilities

153,530

 

 

1,793

 

 

1.56

%

 

76,383

 

 

1,902

 

 

3.32

%

Total interest-bearing liabilities

1,230,270

 

 

6,559

 

 

0.71

%

 

1,059,765

 

 

9,471

 

 

1.19

%

Noninterest-bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

Demand deposits

287,038

 

 

 

 

 

 

$

207,328

 

 

 

 

 

Other liabilities

6,136

 

 

 

 

 

 

3,712

 

 

 

 

 

Stockholders' equity

136,740

 

 

 

 

 

 

112,704

 

 

 

 

 

Total noninterest-bearing liabilities and stockholders' equity

429,914

 

 

 

 

 

 

323,744

 

 

 

 

 

Total liabilities and stockholders' equity

$

1,660,184

 

 

 

 

 

 

$

1,383,509

 

 

 

 

 

Interest rate spread

 

 

 

 

3.34

%

 

 

 

 

 

3.28

%

Net interest income

 

 

$

40,323

 

 

 

 

 

 

$

34,993

 

 

 

Net interest margin

 

 

 

 

3.51

%

 

 

 

 

 

3.51

%

_________________________

3 The average balance of loans includes the average balance of nonaccrual loans. Income on such loans is recognized and recorded on the cash basis. Taxable-equivalent adjustments totaling $190,000 and $129,000.

4 Taxable-equivalent adjustments totaling $39,000 and $10,000 for nine months period ended September 30, 2020 and 2019, respectively, are included in tax-exempt interest on investment securities. The adjustments are based on federal tax rate of 21% with appropriate reductions for the effect of disallowed interest expense incurred in carrying tax-exempt obligations.

Colony Bankcorp, Inc.

Segment Reporting

 

 

Three months ended September 30,

 

Nine months ended September 30,

(dollars in thousands)

 

2020

 

2019

 

2020

 

2019

Banking Division

 

 

 

 

 

 

 

 

Net interest income

 

$

12,920

 

 

$

12,567

 

 

$

38,306

 

 

$

34,730

 

Provision for loan losses

 

1,106

 

 

214

 

 

5,262

 

 

524

 

Noninterest income

 

4,139

 

 

2,794

 

 

9,960

 

 

8,485

 

Noninterest expenses

 

13,242

 

 

11,638

 

 

36,712

 

 

32,799

 

Income taxes

 

785

 

 

723

 

 

1,472

 

 

1,955

 

Segment income

 

$

1,926

 

 

$

2,786

 

 

$

4,820

 

 

$

7,937

 

 

 

 

 

 

 

 

 

 

Total segment assets

 

$

1,563,131

 

 

$

1,467,324

 

 

$

1,563,131

 

 

$

1,467,324

 

 

 

 

 

 

 

 

 

 

Mortgage Banking Division

 

 

 

 

 

 

 

 

Net interest income

 

$

188

 

 

$

81

 

 

$

305

 

 

$

100

 

Provision for loan losses

 

 

 

 

 

 

 

 

Noninterest income

 

2,612

 

 

1,245

 

 

5,686

 

 

1,888

 

Noninterest expenses

 

2,410

 

 

1,191

 

 

5,302

 

 

2,037

 

Income taxes

 

82

 

 

(15

)

 

137

 

 

(10

)

Segment income (loss)

 

$

308

 

 

$

150

 

 

$

552

 

 

$

(39

)

 

 

 

 

 

 

 

 

 

Total segment assets

 

$

50,265

 

 

$

10,209

 

 

$

50,265

 

 

$

10,209

 

 

 

 

 

 

 

 

 

 

Small Business Specialty Lending Division

 

 

 

 

 

 

 

 

Net interest income

 

$

740

 

 

$

 

 

$

1,483

 

 

$

 

Provision for loan losses

 

 

 

 

 

 

 

 

Noninterest income

 

803

 

 

 

 

1,183

 

 

 

Noninterest expenses

 

661

 

 

 

 

924

 

 

 

Income taxes

 

17

 

 

 

 

198

 

 

 

Segment income

 

$

865

 

 

$

 

 

$

1,544

 

 

$

 

 

 

 

 

 

 

 

 

 

Total segment assets

 

$

146,050

 

 

$

 

 

$

146,050

 

 

$

 

 

 

 

 

 

 

 

 

 

Total Consolidated

 

 

 

 

 

 

 

 

Net interest income

 

$

13,848

 

 

$

12,648

 

 

$

40,094

 

 

$

34,830

 

Provision for loan losses

 

1,106

 

 

214

 

 

5,262

 

 

524

 

Noninterest income

 

7,554

 

 

4,039

 

 

16,829

 

 

10,373

 

Noninterest expenses

 

16,313

 

 

12,829

 

 

42,938

 

 

34,836

 

Income taxes

 

884

 

 

708

 

 

1,807

 

 

1,945

 

Segment income

 

$

3,099

 

 

$

2,936

 

 

$

6,916

 

 

$

7,898

 

 

 

 

 

 

 

 

 

 

Total segment assets

 

$

1,759,446

 

 

$

1,477,533

 

 

$

1,759,446

 

 

$

1,477,533

 

Colony Bankcorp, Inc.

Consolidated Balance Sheets

 

 

September 30, 2020

 

December 31, 2019

(dollars in thousands)

 

(unaudited)

 

(audited)

ASSETS

 

 

 

 

Cash and due from banks

 

$

14,226

 

 

$

15,570

 

Interest-bearing deposits in banks and federal funds sold

 

134,613

 

 

88,522

 

Cash and cash equivalents

 

148,839

 

 

104,092

 

Investment securities available for sale, at fair value

 

363,601

 

 

347,332

 

Other investments, at cost

 

3,296

 

 

4,288

 

Loans held for sale

 

55,864

 

 

10,076

 

Loans, net of unearned income

 

1,101,606

 

 

968,814

 

Allowance for loan losses

 

(11,020

)

 

(6,863

)

Loans, net

 

1,090,586

 

 

961,951

 

Premises and equipment

 

31,961

 

 

32,482

 

Other real estate

 

1,875

 

 

1,320

 

Goodwill and other intangible assets

 

18,618

 

 

19,533

 

Bank owned life insurance

 

31,339

 

 

21,629

 

Other assets

 

13,467

 

 

12,610

 

Total assets

 

$

1,759,446

 

 

$

1,515,313

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

Liabilities:

 

 

 

 

Deposits:

 

 

 

 

Noninterest-bearing

 

$

324,135

 

 

$

232,635

 

Interest-bearing

 

1,092,266

 

 

1,061,107

 

Total deposits

 

1,416,401

 

 

1,293,742

 

Federal Home Loan Bank advances

 

22,500

 

 

47,000

 

Paycheck Protection Program Liquidity Facility

 

134,500

 

 

 

Other borrowed money

 

38,042

 

 

38,792

 

Accrued expenses and other liabilities

 

7,657

 

 

5,273

 

Total liabilities

 

1,619,100

 

 

1,384,807

 

 

 

 

 

 

Stockholders’ equity

 

 

 

 

Common stock, $1 par value; 20,000,000 shares authorized, 9,498,783 issued and outstanding, respectively

 

9,499

 

 

9,499

 

Paid in capital

 

43,207

 

 

43,667

 

Retained earnings

 

81,044

 

 

76,978

 

Accumulated other comprehensive income, net of tax

 

6,596

 

 

362

 

Total stockholders’ equity

 

140,346

 

 

130,506

 

Total liabilities and stockholders’ equity

 

$

1,759,446

 

 

$

1,515,313

 

 

Colony Bankcorp, Inc.

 

 

 

 

 

 

 

 

Consolidated Statements of Income (unaudited)

 

 

 

 

 

 

 

 

 

 

Three months ended September 30,

 

Nine months ended September 30,

 

 

2020

 

2019

 

2020

 

2019

(dollars in thousands, except per share data)

 

 

 

 

Interest income:

 

 

 

 

 

 

 

 

Loans, including fees

 

$

13,743

 

 

13,654

 

 

$

40,733

 

 

36,437

 

Investment securities, including tax exempt of $103, $10, $145, and $38, respectively

 

1,747

 

 

2,338

 

 

5,536

 

 

7,078

 

Deposits in banks and short term investments

 

52

 

 

206

 

 

384

 

 

810

 

Total interest income

 

15,542

 

 

16,198

 

 

46,653

 

 

44,325

 

 

 

 

 

 

 

 

 

 

Interest expense:

 

 

 

 

 

 

 

 

Deposits

 

1,144

 

 

2,815

 

 

4,766

 

 

7,569

 

Federal Home Loan Bank advances

 

159

 

 

269

 

 

626

 

 

775

 

Paycheck Protection Program Liquidity Facility

 

118

 

 

 

 

205

 

 

 

Other borrowings

 

273

 

 

458

 

 

962

 

 

1,127

 

Total interest expense

 

1,694

 

 

3,542

 

 

6,559

 

 

9,471

 

Net interest income

 

13,848

 

 

12,656

 

 

40,094

 

 

34,854

 

Provision for loan losses

 

1,106

 

 

214

 

 

5,262

 

 

524

 

Net interest income after provision for loan losses

 

12,742

 

 

12,442

 

 

34,832

 

 

34,330

 

 

 

 

 

 

 

 

 

 

Noninterest income:

 

 

 

 

 

 

 

 

Service charges on deposits

 

1,316

 

 

1,546

 

 

3,906

 

 

3,997

 

Mortgage fee income

 

2,616

 

 

1,255

 

 

5,706

 

 

1,942

 

Gain on sale of SBA loans

 

748

 

 

 

 

1,004

 

 

 

Gain on sale of securities

 

716

 

 

34

 

 

1,009

 

 

99

 

Interchange fees

 

1,342

 

 

1,001

 

 

3,624

 

 

2,755

 

BOLI Income

 

237

 

 

124

 

 

548

 

 

405

 

Insurance commissions and fees

 

254

 

 

66

 

 

679

 

 

96

 

Other

 

325

 

 

4

 

 

353

 

 

1,056

 

Total noninterest income

 

7,554

 

 

4,030

 

 

16,829

 

 

10,350

 

 

 

 

 

 

 

 

 

 

Noninterest expense:

 

 

 

 

 

 

 

 

Salaries and employee benefits

 

9,104

 

 

7,186

 

 

24,331

 

 

18,848

 

Occupancy and equipment

 

1,338

 

 

1,290

 

 

3,972

 

 

3,459

 

Acquisition related

 

207

 

 

649

 

 

714

 

 

2,610

 

Information technology expenses

 

1,440

 

 

1,196

 

 

4,135

 

 

3,158

 

Insurance expenses

 

483

 

 

241

 

 

1,596

 

 

450

 

Professional fees

 

481

 

 

558

 

 

1,343

 

 

1,369

 

Advertising and public relations

 

459

 

 

677

 

 

1,478

 

 

1,370

 

Communications

 

212

 

 

196

 

 

631

 

 

538

 

Writedown of building

 

582

 

 

 

 

582

 

 

 

FHLB prepayment penalty

 

925

 

 

 

 

925

 

 

 

Other

 

1,082

 

 

1,365

 

 

3,231

 

 

3,596

 

Total noninterest expense

 

16,313

 

 

13,358

 

 

42,938

 

 

35,398

 

Income before income taxes

 

3,983

 

 

3,114

 

 

8,723

 

 

9,282

 

Income taxes

 

884

 

 

597

 

 

1,807

 

 

1,827

 

Net income

 

$

3,099

 

 

$

2,517

 

 

$

6,916

 

 

$

7,455

 

Earnings per common share:

 

 

 

 

 

 

 

 

Basic

 

$

0.33

 

 

$

0.27

 

 

$

0.73

 

 

$

0.83

 

Diluted

 

0.33

 

 

0.27

 

 

0.73

 

 

0.83

 

Weighted average common shares outstanding:

 

 

 

 

 

 

 

 

Basic

 

9,498,783

 

 

9,494,771

 

 

9,498,783

 

 

9,008,196

 

Diluted

 

9,498,783

 

 

9,491,771

 

 

9,498,783

 

 

9,008,196

 

Colony Bankcorp, Inc.

Quarterly Comparison

 

 

2020

 

2019

(dollars in thousands)

 

Third
Quarter

 

Second
Quarter

 

First
Quarter

 

Fourth
Quarter

 

Third
Quarter

Assets

 

$

1,759,446

 

 

$

1,777,568

 

 

$

1,510,048

 

 

$

1,515,313

 

 

$

1,477,682

 

Loans, net

 

1,090,586

 

 

1,103,688

 

 

980,642

 

 

961,951

 

 

951,559

 

Deposits

 

1,416,401

 

 

1,421,758

 

 

1,293,076

 

 

1,293,742

 

 

1,251,273

 

Total equity

 

140,346

 

 

138,594

 

 

136,072

 

 

130,506

 

 

129,651

 

Net income

 

3,099

 

 

2,214

 

 

1,603

 

 

2,757

 

 

2,518

 

Earnings per basic share

 

0.33

 

 

0.23

 

 

0.17

 

 

0.29

 

 

0.27

 

 

 

 

 

 

 

 

 

 

 

 

Key Performance Ratios:

 

 

 

 

 

 

 

 

 

 

Return on average assets

 

0.70

%

 

0.52

%

 

0.42

%

 

0.73%

 

0.67%

Return on average total equity

 

8.80

%

 

6.47

%

 

4.79

%

 

8.47%

 

7.86%

Total equity to total assets

 

7.98

%

 

7.80

%

 

9.01

%

 

8.61%

 

8.77%

Tangible equity to tangible assets

 

7.00

%

 

6.82

%

 

7.83

%

 

7.42%

 

7.56%

Net interest margin

 

3.34

%

 

3.41

%

 

3.63

%

 

3.72%

 

3.64%

Colony Bankcorp, Inc.

Quarterly Loan Comparison

 

 

2020

 

2019

(dollars in thousands)

 

Third
Quarter

 

Second
Quarter

 

First
Quarter

 

Fourth
Quarter

 

Third
Quarter

Core

 

$

868,833

 

 

$

862,087

 

 

$

840,652

 

 

$

848,088

 

 

$

826,309

 

PPP

 

133,756

 

 

133,158

 

 

 

 

 

 

 

Purchased

 

99,017

 

 

118,732

 

 

148,374

 

 

120,726

 

 

132,414

 

Total

 

$

1,101,606

 

 

$

1,113,977

 

 

$

989,026

 

 

$

968,814

 

 

$

958,723

 

 

Tracie Youngblood
EVP & Chief Financial Officer
(229) 426-6000 (Ext 6003)

Source: Colony Bankcorp, Inc.

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