Colony Bankcorp, Inc. Announces Third Quarter Results

FITZGERALD, Ga., Oct. 20, 2016 (GLOBE NEWSWIRE) — Colony Bankcorp, Inc. (Nasdaq:CBAN), today reported net income available to shareholders of $1,880,000, or $0.22 per diluted share for the third quarter of 2016 compared to $1,606,000, or $0.19 per diluted share for the comparable 2015 period, while net income available to shareholders for the nine month period ended September 30, 2016 was $5,297,000, or $0.62 per diluted share compared to $4,414,000, or $0.52 per share for the comparable 2015 period.    This increase of 20.00 percent in net income for the comparable nine month period was primarily driven by an increase in net interest income and a reduction in preferred stock dividends.  “In addition to solid earnings, we also redeemed $3,661,000 of preferred stock that on an annual basis reduces our dividend payment by $329,490.  Also of significance during the quarter was total loan growth of $11.91 million and a reduction in substandard assets of $1.07 million,” said Ed Loomis, President and Chief Executive Officer.  “We have positioned the company to seek regulatory approval to redeem $5,000,000 of preferred stock during the fourth quarter.  This will reduce the preferred stock to $9,360,000 and result in dividend savings of $450,000 on an annual basis.  As we look to 2017, we believe we are positioned to continue to improve on earnings and asset quality, which in turn will enhance shareholder value.” 

Capital

Colony continues to maintain a strong regulatory capital position to be categorized as “well-capitalized” by regulatory benchmarks.  At September 30, 2016, the Company’s tier one leverage ratio, tier one ratio, total risk-based capital ratio and common equity tier one capital ratio were 10.85 percent, 15.79 percent, 16.95 percent and 11.01 percent, respectively, compared to 10.94 percent, 16.13 percent, 17.32 percent  and 10.84 percent, respectively, at June 30, 2016.  The Company’s capital ratios were all in excess of regulatory minimums required to be classified as “well-capitalized.”

Net Interest Margin 

During the third quarter of 2016, the Company reported net interest income of $9.56 million and a net interest margin of 3.56 percent compared to $9.50 million and 3.58 percent, respectively, for third quarter 2015, while net interest income for nine months ended September 30, 2016 was $28.54 million and a net interest margin of 3.52 percent compared to $27.95 million and 3.48 percent, respectively, for the comparable 2015 period.  Net interest margin improvement resulted in the Company posting an increase in net interest income of approximately $591 thousand over the comparable 2015 period.  While we have been in a historical low interest rate environment for some time, recent Federal Reserve discussion suggests a modest move toward a “tightening” interest rate policy in December.

Asset Quality

The Company continues to monitor our substandard and non-performing assets and focus on problem asset resolution.  Substandard assets that include non-performing assets totaled $41.49 million at September 30, 2016 compared to $41.24 million and $43.02 million, respectively, at December 31, 2015 and September 30, 2015.  Substandard assets adjusted for SBA guarantees to tier one capital plus loan loss reserve ratio was 31.34 percent, 31.36 percent and 31.73 percent, respectively, at September 30, 2016, December 31, 2015 and September 30, 2015.  Non-performing assets increased slightly from the previous quarter end to $23.80 million or 3.03 percent of total loans and other real estate owned as of September 30, 2016.  This compares to $23.26 million or 3.03 percent and $24.57 million or 3.17 percent, respectively, as of December 31, 2015 and September 30, 2015.       

Other real estate (“OREO”) totaled $9.81 million at September 30, 2016 compared to $8.84 million and $11.00 million, respectively, at December 31, 2015 and September 30, 2015. Though these levels remain at an elevated level, we continue to work diligently to dispose these properties at fair value.   We have approximately $2.5 million currently under contract and scheduled to close during fourth quarter. 

In the third quarter of 2016 net charge-offs were $541 thousand, or 0.07 percent of average loans as compared to net charge-offs of $328 thousand, or 0.04 percent of average loans in third quarter 2015, while year to date 2016 net charge-offs were $463 thousand, or 0.06 percent of average loans compared to $1.14 million, or 0.15 percent of average loans for the comparable 2015 period.  The loan loss reserve was $9.20 million or 1.19 percent of total loans on September 30, 2016 compared to $8.60 million or 1.13 percent and $8.40 million or 1.10 percent, respectively, at December 31, 2015 and September 30, 2015.  Loan loss reserve methodology resulted in three months ended September 30, 2016 provision for loan losses of $354 thousand compared to $250 thousand for the comparable 2015 period, while year to date 2016 provision for loan losses was $1.06 million compared to $741 thousand for the comparable 2015 period.

Noninterest Income

Total noninterest income increased in the comparable periods as noninterest income for nine months ended September 30, 2016 was $7.16 million compared to $6.80 million in the comparable 2015 period, or an increase of 5.26 percent.  Gain on sale of securities totaled $385 thousand compared to $12 thousand in the comparable 2015 period to primarily account for the increase.  Our initiative to increase secondary market mortgage fee income has resulted in an increase of $122 thousand, or 31.69 percent over the comparable 2015 period.      

Noninterest Expense

Total noninterest expense increased in the comparable periods as noninterest expense for nine months ended September 30, 2016 was $25.24 million compared to $24.94 million for the comparable 2015 period, or an increase of 1.21 percent.  Salaries and employee benefit expenses increased 4.18 percent, occupancy expense decreased 2.27 percent and other noninterest expense decreased 2.13 percent for the comparable periods.  The efficiency ratio improved to 71.22 percent for nine months ended September 30, 2016 compared to 71.61 percent for the comparable 2015 period, or a decrease of 0.54 percent.   The company continues to explore opportunities to further improve its’ operating efficiency.

Colony Bankcorp, Inc. is a bank holding company headquartered in Fitzgerald, Georgia that consists of one operating subsidiary, Colony Bank.  Colony Bank conducts a general full service commercial, consumer and mortgage banking business through twenty-six offices located in the central, southern and coastal Georgia cities of Albany, Ashburn, Broxton, Centerville, Columbus, Cordele, Douglas, Eastman, Fitzgerald, Leesburg, Moultrie, Quitman, Rochelle, Savannah, Soperton, Sylvester, Thomaston, Tifton, Valdosta and Warner Robins, Georgia. 

Colony Bankcorp, Inc. Common Stock is quoted on the Nasdaq Global Market under the symbol “CBAN”.

Certain statements contained in the preceding release that are not statements of historical fact constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 (the “Act”), notwithstanding that such statements are not specifically identified.  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 the Act.  Examples of forward-looking statements include, but are not limited to: (i) projections 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; and (iv) 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.

Forward-looking statements involve risks and uncertainties that may cause actual results to differ materially from those in such statements.  Forward-looking statements speak only as of the date on which such statements are made.  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. 

           
Consolidated Balance Sheets Colony Bankcorp, Inc. 
(in thousands) 
           
  September 30, 2016   December 31, 2015   September 30, 2015
  (unaudited)   (audited)   (unaudited)
ASSETS          
Cash and Cash Equivalents          
Cash and Due from Banks $ 17,803     $ 22,257     $ 17,137  
Interest-Bearing Deposits   13,872       38,615       15,996  
Investment Securities          
Available for Sale, at Fair Value   286,089       296,149       271,611  
Held for Maturity, at Cost (Fair Value          
of $28 as of September 30, 2015)               28  
    286,089       296,149       271,639  
Federal Home Loan Bank Stock, at Cost   3,010       2,731       2,731  
Loans   776,117       758,636       764,204  
Allowance for Loan Losses   (9,203 )     (8,604 )     (8,402 )
Unearned Interest and Fees   (382 )     (357 )     (355 )
    766,532       749,675       755,447  
Premises and Equipment   27,745       26,454       24,460  
Other Real Estate   9,812       8,839       10,998  
Other Intangible Assets   89       116       125  
Other Assets   27,865       29,313       28,787  
Total Assets $ 1,152,817     $ 1,174,149     $ 1,127,320  
           
LIABILITIES AND STOCKHOLDERS’ EQUITY          
           
Deposits          
Noninterest-Bearing $ 138,941     $ 133,886     $ 125,793  
Interest-Bearing   839,649       877,668       832,241  
    978,590       1,011,554       958,034  
Borrowed Money          
Subordinated Debentures   24,229       24,229       24,229  
Other Borrowed Money   46,000       40,000       40,000  
    70,229       64,229       64,229  
           
Other Liabilities   3,263       2,909       3,983  
           
Stockholders’ Equity          
Preferred Stock, Stated Value $1,000 a Share;          
Authorized 10,000,000 Shares, Issued 14,360 Shares            
as of Sept. 30, 2016, 18,021 as of Dec. 31, 2015 and          
23,167 as of Sept. 30, 2015, Respectively   14,360       18,021       23,167  
Common Stock, Par Value $1 a share; Authorized          
20,000,000 Shares, Issued 8,439,258 Shares as of          
Sept. 30, 2016, Dec. 31, 2015 and Sept, 30, 2015,          
Respectively   8,439       8,439       8,439  
Paid in Capital   29,145       29,145       29,145  
Retained Earnings   49,582       44,286       42,703  
Accumulated Other Comprehensive Loss, Net of Tax   (791 )     (4,434 )     (2,380 )
    100,735       95,457       101,074  
Total Liabilities and Stockholders’ Equity $ 1,152,817     $ 1,174,149     $ 1,127,320  
 

   
Consolidated Statements of Income Colony Bankcorp, Inc.  
(in thousands except per share data)  
   
  Quarter   Year-to-Date  
  Three Months Ended   Nine Months Ended  
  9/30/2016   9/30/2015   9/30/2016   9/30/2015  
  (unaudited)   (unaudited)   (unaudited)   (unaudited)  
Interest Income                
Loans, Including Fees $ 9,810     $ 9,981     $ 29,135     $ 29,563    
Federal Funds Sold                     15    
Deposits with Other Banks   18       17       79       58    
Investment Securities                
U. S. Government Agencies   1,266       1,060       3,978       3,108    
State, County and Municipal   30       28       97       78    
Dividends on Other Investments   32       31       97       91    
    11,156       11,117       33,386       32,913    
Interest Expense                
Deposits   1,187       1,210       3,580       3,648    
Borrowed Money   413       410       1,269       1,319    
    1,600       1,620       4,849       4,967    
Net Interest Income   9,556       9,497       28,537       27,946    
Provision for Loan Losses   354       250       1,062       741    
Net Interest Income After Provision for Loan Losses     9,202       9,247       27,475       27,205    
                 
Noninterest Income                
Service Charges on Deposits   1,128       1,133       3,185       3,184    
Other Service Charges, Commissions and Fees   686       661       2,104       1,963    
Mortgage Fee Income   254       138       507       385    
Securities Gains (Losses)   256       9       385       12    
Other   313       292       980       1,259    
    2,637       2,233       7,161       6,803    
Noninterest Expense                
Salaries and Employee Benefits   4,726       4,395       13,825       13,270    
Occupancy and Equipment   1,025       1,026       2,967       3,036    
Other   2,903       2,914       8,451       8,635    
    8,654       8,335       25,243       24,941    
                 
Income Before Income Taxes   3,185       3,145       9,393       9,067    
Income Taxes   927       945       2,907       2,799    
Net Income   2,258       2,200       6,486       6,268    
                 
Preferred Stock Dividends   378       594       1,189       1,854    
                 
Net Income Available to Common Shareholders $ 1,880     $ 1,606     $ 5,297     $ 4,414    
Net Income Per Share of Common Stock                
Basic $ 0.22     $ 0.19     $ 0.63     $ 0.52    
Diluted $ 0.22     $ 0.19     $ 0.62     $ 0.52    
Weighted Average Basic Shares Outstanding   8,439,258       8,439,258       8,439,258       8,439,258    
Weighted Average Diluted Shares Outstanding   8,506,268       8,466,285       8,495,752       8,449,057    
 

 

COLONY BANKCORP, INC
FINANCIAL HIGHLIGHTS (UNAUDITED)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
                 
  QUARTER ENDED   YEAR-TO-DATE  
EARNINGS SUMMARY 9/30/2016     9/30/2015     9/30/2016     9/30/2015    
Net Interest Income $   9,556     $   9,497     $   28,357     $   27,946    
Provision for Loan Losses     354         250         1,062         741    
Non-interest Income     2,637         2,233         7,161         6,803    
Non-interest Expense     8,654         8,335         25,243         24,941    
Income Taxes     927         945         2,907         2,799    
Net Income     2,258         2,200         6,486         6,268    
Preferred Stock Dividend     378         594         1,189         1,854    
Net Income Available to                
  Common Shareholders     1,880         1,606         5,297         4,464    
 
  QUARTER ENDED   YEAR-TO-DATE  
PER COMMON SHARE SUMMARY 9/30/2016     9/30/2015     9/30/2016     9/30/2015    
Common Shares Outstanding     8,439,258         8,439,258         8,439,258         8,439,258    
Weighted Average Basic Shares     8,439,258         8,439,258         8,439,258         8,439,258    
Weighted Average Diluted Shares     8,506,268         8,466,285         8,495,752         8,449,057    
Earnings Per Basic Share (b) $ 0.22     $ 0.19     $ 0.63     $ 0.52    
Earnings Per Diluted Share (b) $ 0.22     $ 0.19     $ 0.62     $ 0.52    
Common Book Value Per Share $ 10.23     $ 9.23     $ 10.23     $ 9.23    
Tangible Common Book Value Per Share $ 10.22     $ 9.22     $ 10.22     $ 9.22    
 
  QUARTER ENDED   YEAR-TO-DATE  
OPERATING RATIOS (1) 9/30/2016     9/30/2015     9/30/2016     9/30/2015    
Net Interest Margin (a)   3.56 %     3.58 %     3.52 %     3.48 %  
Return on Average Assets (b)   0.65 %     0.57 %     0.61 %     0.51 %  
Return on Average Total Equity (b)   7.35 %     6.28 %     7.03 %     5.77 %  
Efficiency (c)   72.22 %     70.85 %     71.22 %     71.61 %  
                 
(1) Annualized  
(a) Computed using fully taxable-equivalent net income  
(b) Computed using net income available to shareholders  
(c) Computed by dividing non-interest expense by the sum of fully taxable-equivalent net interest income and non-interest income and excluding security gains/losses.  
   

 

    QUARTER ENDED
ENDING BALANCES   9/30/2016     9/30/2015  
Total Assets   $   1,152,817     $   1,127,320  
Loans, Net of Reserves       766,532         755,447  
Allowance for Loan Losses       9,203         8,402  
Intangible Assets       89         125  
Deposits       978,590         958,034  
Common Shareholders’ Equity       86,375         77,907  
Common Equity to Total Assets       7.49 %     6.91 %
Total Equity       100,735         101,074  
Total Equity to Total Assets     8.74 %     8.97 %
 

 

    QUARTER ENDED   YEAR-TO-DATE
AVERAGE BALANCES   9/30/2016     9/30/2015     9/30/2016     9/30/2015  
Total Assets   $   1,151,458     $   1,135,920     $   1,157,816     $   1,145,711  
Loans, Net of Reserves       756,776         753,340         748,960         745,609  
Deposits       977,544         965,300         988,483         974,693  
Common Shareholders’ Equity       85,603         76,043         82,838         74,478  
Total Equity       102,351         102,328         100,431         101,911  
                 
  QUARTER ENDED   YEAR-TO-DATE
ASSET QUALITY   9/30/2016     9/30/2015     9/30/2016     9/30/2015  
Nonperforming Loans   $   13,987     $   13,567     $   13,987     $   13,567  
Nonperforming Assets       23,799         24,565         23,799         24,565  
Substandard Assets       41,485         43,021         41,485         43,021  
Net Loan Chg-offs (Recoveries)       541         328         463         1,141  
Reserve for Loan Loss to Total Loans     1.19 %     1.10 %     1.19 %     1.10 %
Reserve for Loan Loss to Non- performing Loans     65.80 %     61.93 %     65.80 %     61.93 %
Reserve for Loan Loss to Non-performing Assets     38.67 %     34.20 %     38.67 %     34.20 %
Net Loan Chg-offs (Recoveries)    
  to Avg. Total Loans     0.07 %     0.04 %     0.06 %     0.15 %
Nonperforming Loans to Total Loans     1.80 %     1.78 %     1.80 %     1.78 %
Nonperforming Assets to Total Assets     2.06 %     2.18 %     2.06 %     2.18 %
Nonperforming Assets to Total Loans                
  And Other Real Estate     3.03 %     3.17 %     3.03 %     3.17 %
Substandard Assets to Tier One Capital                
  and Allowance for Loan Losses     31.34 %     31.73 %     31.34 %     31.73 %
                 

 

Quarterly Comparative Data (in thousands, except per share data)   
  3Q2016   2Q2016   1Q2016   4Q2015   3Q2015    
Assets $   1,152,817   $   1,147,027   $   1,168,389   $   1,174,149   $   1,127,320    
Loans     766,532       754,437       744,356       749,675       755,447    
Deposits      978,590       976,567       1,000,043       1,011,554       958,034    
Common Shareholders’ Equity     86,375       85,444       82,522       77,436       77,907    
Total Equity     100,735       103,465       100,543       95,457       101,074    
Net Income      2,258       2,167       2,061       2,105       2,200    
Net Income Available to            
  Common Shareholders     1,880       1,761       1,656       1,584       1,606    
Net Income Per Share   0.22     0.21     0.20     0.19     0.19    
             
             
Key Performance Ratios 3Q2016   2Q2016   1Q2016   4Q2015   3Q2015    
Return on Average Assets (1)   0.65 %   0.61 %   0.57 %   0.55 %   0.57 %  
Return on Average Total Equity (1)   7.35 %   6.99 %   6.75 %   6.26 %   6.28 %  
Common Equity to Total Assets   7.49 %   7.45 %   7.06 %   6.60 %   6.91 %  
Total Equity to Total Assets   8.74 %   9.02 %   8.61 %   8.13 %   8.97 %  
Net Interest Margin   3.56 %   3.53 %   3.47 %   3.63 %   3.58 %  
             
  (1) Computed using net income available to shareholders   
             
CONTACT: Contact: Terry L. Hester
Chief Financial Officer 
(229) 426-6000 (Ext 6002)