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Colony Bankcorp, Inc. Announces Fourth Quarter Results

FITZGERALD, Ga., Jan. 23, 2015 (GLOBE NEWSWIRE) -- Colony Bankcorp, Inc. (Nasdaq:CBAN), today reported net income available to shareholders of $1,310,000, or $0.16 per diluted share for the fourth quarter of 2014 compared to $1,241,000, or $0.15 per diluted share for the comparable 2013 period, while net income available to shareholders for twelve months ended December 31, 2014 was $4,843,000, or $0.57 per diluted share compared to $3,120,000, or $0.37 per share for the comparable 2013 period. This increase of 55.22 percent in net income for the comparable twelve month period was primarily driven by a reduction in provision for loan losses, an increase in net interest income and an increase in noninterest income. "Much was accomplished during 2014 as Colony had significant improvement in earnings and asset quality. Total non-performing assets were $28.74 million at December 31, 2014 which is a 27.44 percent reduction from the previous year end of $39.61 million. Substandard assets to tier one capital plus loan loss reserve now stands at 32.39 percent – down from the prior year end level of 39.22 percent," said Ed Loomis, President and Chief Executive Officer. "Of significance during the quarter, we received regulatory approval to reinstate payments on our trust preferred securities and preferred stock which had been in deferred status. As we look to 2015, 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 December 31, 2014, the Company's tier one leverage ratio, tier one and total risk-based capital ratios were 11.18 percent, 16.73 percent and 17.89 percent, respectively, compared to 11.01 percent, 16.51 percent and 17.76 percent, respectively, at September 30, 2014 and to 10.57 percent, 15.81 percent and 17.06 percent, respectively, at December 31, 2013. The Company's capital ratios were all in excess of regulatory minimums required to be classified as "well-capitalized".

Net Interest Margin

During the fourth quarter of 2014, the Company reported net interest income of $9.50 million and a net interest margin of 3.59 percent compared to $9.69 million and 3.68 percent, respectively, for fourth quarter 2013, while net interest income for twelve months ended December 31, 2014 was $37.96 million and a net interest margin of 3.60 percent compared to $37.69 million and 3.61 percent, respectively, for the comparable 2013 period. Though the low interest rate environment continues to be challenging for the banking industry, the company continues to focus on maximizing its net interest margin through deposit and loan pricing guidance and balance sheet restructuring.

Asset Quality

The Company continues to closely monitor our substandard and non-performing assets and focus on problem asset resolution. Substandard assets that include non-performing assets totaled $43.29 million at December 31, 2014 compared to $43.49 million and $53.45 million, respectively, at September 30, 2014 and December 31, 2013. Substandard assets adjusted for SBA guarantees to tier one capital plus loan loss reserve ratio was 32.39%, 30.23% and 39.22%, respectively, at December 31, 2014, September 30, 2014 and December 31, 2013. Non-performing assets decreased significantly from the previous year end to $28.74 million or 3.80 percent of total loans and other real estate owned as of December 31, 2014. This compares to $24.01 million or 3.18 percent and $39.61 million or 5.17 percent, respectively, as of September 30, 2014 and December 31, 2013. Loan loss reserve methodology resulted in three months ended December 31, 2014 provision for loan losses of $0 compared to $285 thousand for the comparable 2013 period, while in twelve months ended December 31, 2014 the provision for loan losses was $1.31 million compared to $4.49 million for the comparable 2013 period. With continued stabilization in the economy, we expect continued improvement in our substandard assets.

Other real estate ("OREO") totaled $10.40 million at December 31, 2014 compared to $10.83 million and $15.50 million, respectively, at September 30, 2014 and December 31, 2013. We continue to devote much time and effort in reducing our level of OREO properties and the current balance is at the lowest level in a number of quarters. Colony has established a target of twelve months to liquidate improved properties due to the high carrying cost of taxes, insurance, maintenance and repairs associated with holding these properties on our books.

In the fourth quarter of 2014 net charge-offs were $0.99 million, or 0.13 percent of average loans as compared to net charge-offs of $1.43 million, or 0.19 percent of average loans in fourth quarter 2013, while net charge-offs for twelve months ended December 31, 2014 were $4.31 million, or 0.58 percent of average loans as compared to net charge-offs of $5.42 million, or 0.73 percent of average loans for the comparable 2013 period. The loan loss reserve was $8.80 million on December 31, 2014, or 1.18 percent of total loans compared to $9.79 million, or 1.32 percent on September 30, 2014 and to $11.81 million, or 1.57 percent on December 31, 2013. Management believes that the 2014 contributions to Allowance for Loan Losses address the level of non-performing assets and the related level of substandard assets to be adequately reserved at December 31, 2014.

Noninterest Income

Total noninterest income increased in the comparable periods as noninterest income for twelve months ended December 31, 2014 was $9.13 million compared to $8.38 million in the comparable 2013 period, or an increase of 8.93 percent. The significant increase was debit card interchange fees and ATM fees increasing $702 thousand, or 42.26 percent. Also, security gains were $24 thousand for 2014 compared to a loss of $364 thousand for 2013. Offsetting the increases were service charge fee income on deposit accounts decreasing $123 thousand, or 2.62 percent, mortgage fee income decreasing $64 thousand, or 13.22 percent and gains on the sale of SBA/USDA loans decreasing $635 thousand, or 100.00 percent.

Noninterest Expense

Total noninterest expense remained relatively flat as noninterest expense for twelve months ended December 31, 2014 was $34.98 million compared to $34.62 million for the comparable 2013 period, or an increase of 1.05 percent. Credit-related expenses continue to be a strain on earnings as write down and losses on OREO property and repossessed assets along with repossession and foreclosure expenses totaled $2.69 million in twelve months ended December 31, 2014 compared to $3.92 million in the comparable 2013 period, or a decrease of 31.49 percent. Salaries and employee benefit expenses increased to $17.51 million in twelve months ended December 31, 2014 compared to $16.69 million in the comparable 2013 period, or an increase of 4.89 percent. Occupancy expenses increased to $4.06 million in the twelve month period ended December 31, 2014 compared to $3.79 million in the comparable 2013 period, or an increase of 7.09 percent. Other noninterest expense decreased to $13.41 million compared to $14.13 million, or a decrease of 5.11 percent. A significant reduction in noninterest expense is FDIC insurance assessment which has decreased to $0.97 million in 2014 from $1.32 million from the comparable 2013 period, or 26.94 percent.

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-nine offices located in the central, southern and coastal Georgia cities of Albany, Ashburn, Broxton, Centerville, Chester, Columbus, Cordele, Douglas, Eastman, Fitzgerald, Leesburg, Moultrie, Pitts, 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.

COLONY BANKCORP, INC.
FINANCIAL HIGHLIGHTS (UNAUDITED)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
QUARTER ENDED YEAR-TO-DATE
EARNINGS SUMMARY 12/31/14 12/31/13 12/31/14 12/31/13
Net Interest Income $9,503 $9,694 $37,963 37,689
Provision for Loan Losses 0 285 1,308 4,485
Non-interest Income 2,407 2,018 9,125 8,377
Non-interest Expense 9,289 8,998 34,980 34,617
Income Taxes 643 803 3,268 2,235
Net Income 1,978 1,626 7,532 4,629
Preferred Stock Dividend 668 385 2,689 1,509
Net Income Available to Common Shareholders 1,310 1,241 4,843 3,120
QUARTER ENDED YEAR-TO-DATE
PER COMMON SHARE SUMMARY 12/31/14 12/31/13 12/31/14 12/31/13
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 8,439,258 8,439,258 8,439,258 8,439,258
Earnings Per Basic Share (b) $0.16 $0.15 $0.57 $0.37
Earnings Per Diluted Share (b) $0.16 $0.15 $0.57 $0.37
Common Book Value Per Share $8.42 $7.34 $8.42 $7.34
Tangible Common Book Value Per Share $8.40 $7.32 $8.40 $7.32
QUARTER ENDED YEAR-TO-DATE
OPERATING RATIOS (1) 12/31/14 12/31/13 12/31/14 12/31/13
Net Interest Margin (a) 3.59% 3.68% 3.60% 3.61%
Return on Average Assets (b) 0.46% 0.44% 0.43% 0.28%
Return on Average Total Equity (b) 5.37% 5.43% 5.11% 3.34%
Efficiency (c) 78.01% 74.24% 74.16% 74.29%
(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 12/31/14 12/31/13
Total Assets $1,146,898 $1,148,551
Loans, Net of Reserves 736,930 739,052
Allowance for Loan Losses 8,802 11,806
Intangible Assets 152 188
Deposits 979,304 987,530
Common Shareholders' Equity 71,027 61,954
Common Equity to Total Assets 6.18% 5.38%
Total Equity 99,027 89,954
Total Equity to Total Assets 8.62% 7.81%
QUARTER ENDED YEAR-TO-DATE
AVERAGE BALANCES 12/31/14 12/31/13 12/31/14 12/31/13
Total Assets $1,132,317 $1,131,317 $1,128,052 $1,118,071
Loans, Net of Reserves 736,797 740,538 730,643 731,280
Deposits 960,043 966,458 959,059 953,312
Common Shareholders' Equity 69,650 63,526 66,751 65,446
Total Equity 97,650 91,501 94,751 93,358
QUARTER ENDED YEAR-TO-DATE
ASSET QUALITY 12/31/14 12/31/13 12/31/14 12/31/13
Nonperforming Loans $18,341 $24,111 $18,341 $24,111
Nonperforming Assets 28,743 39,613 28,743 39,613
Substandard Assets 43,285 53,449 43,285 53,449
Net Loan Chg-offs (Recoveries) 986 1,430 4,312 5,416
Reserve for Loan Loss to Total Loans 1.18% 1.57% 1.18% 1.57%
Reserve for Loan Loss to Non- performing Loans 47.99% 48.97% 47.99% 48.97%
Reserve for Loan Loss to Non-performing Assets 30.62% 29.80% 30.62% 29.80%
Net Loan Chg-offs (Recoveries) to Avg. Total Loans 0.13% 0.19% 0.58% 0.73%
Nonperforming Loans to Total Loans 2.46% 3.21% 2.46% 3.21%
Nonperforming Assets to Total Assets 2.51% 3.44% 2.50% 3.44%
Nonperforming Assets to Total Loans And Other Real Estate 3.80% 5.17% 3.80% 5.17%
Substandard Assets to Tier One Capital and Allowance for Loan Losses 32.39% 39.22% 32.39% 39.22%
Quarterly Comparative Data (in thousands, except per share data)
4Q2014 3Q2014 2Q2014 1Q2014 4Q2013
Assets $1,146,898 $1,114,414 $1,118,382 $1,141,836 $1,148,551
Loans 736,930 733,139 724,939 726,125 739,052
Deposits 979,304 941,200 948,269 976,854 987,529
Common Shareholders' Equity 71,027 68,272 67,210 64,348 61,954
Total Equity 99,027 96,272 95,210 92,348 89,954
Net Income 1,978 2,081 2,016 1,457 1,626
Net Income Available to Common Shareholders 1,310 1,384 1,335 814 1,241
Net Income Per Share 0.16 0.16 0.16 0.10 0.15
Key Performance Ratios 4Q2014 3Q2014 2Q2014 1Q2014 4Q2013
Return on Average Assets (1) 0.46% 0.49% 0.47% 0.29% 0.44%
Return on Average Total Equity (1) 5.37% 5.78% 5.69% 3.55% 5.43%
Common Equity to Total Assets 6.18% 6.13% 6.01% 5.64% 5.38%
Total Equity to Total Assets 8.62% 8.64% 8.51% 8.09% 7.81%
Net Interest Margin 3.59% 3.73% 3.61% 3.47% 3.68%
(1) Computed using net income available to shareholders
Consolidated Balance Sheets Colony Bankcorp, Inc.
(in thousands)
Dec. 31, 2014 Dec. 31, 2013 Dec. 31, 2012
(unaudited) (audited) (audited)
ASSETS
Cash and Cash Equivalents
Cash and Due from Banks $24,473 $25,692 $29,244
Federal Funds Sold 20,132 20,495 20,002
44,605 46,187 49,246
Interest-Bearing Deposits 21,206 21,960 21,795
Investment Securities
Available for Sale, at Fair Value 274,595 263,258 268,301
Held for Maturity, at Cost (Fair Value of $30, $37 and $42 as of Dec. 31, 2014, Dec. 31, 2013, and Dec. 31, 2012, Respectively) 30 37 41
274,625 263,295 268,342
Federal Home Loan Bank Stock, at Cost 2,831 3,164 3,364
Loans 746,094 751,218 747,050
Allowance for Loan Losses (8,802) (11,806) (12,737)
Unearned Interest and Fees (362) (360) (234)
736,930 739,052 734,079
Premises and Equipment 24,960 24,876 24,916
Other Real Estate 10,402 15,502 15,941
Other Intangible Assets 152 188 224
Other Assets 31,187 34,327 21,490
Total Assets $1,146,898 $1,148,551 $1,139,397
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits
Noninterest-Bearing $128,340 $115,261 $123,967
Interest-Bearing 850,964 872,269 855,718
979,304 987,530 979,685
Borrowed Money
Subordinated Debentures 24,229 24,229 24,229
Other Borrowed Money 40,000 40,000 35,000
64,229 64,229 59,229
Other Liabilities 4,338 6,838 4,724
Stockholders' Equity
Preferred Stock, Stated Value $1,000 a Share; Authorized 10,000,000 Shares, Issued 28,000 Shares 28,000 28,000 27,827
Common Stock, Par Value $1 a share; Authorized 20,000,000 Shares, Issued 8,439,258 Shares as of Dec. 31, 2014, Dec. 31, 2013 and Dec. 31, 2012, Respectively 8,439 8,439 8,439
Paid in Capital 29,145 29,145 29,145
Retained Earnings 38,288 33,445 30,498
Accumulated Other Comprehensive Loss, Net of Tax (4,845) (9,075) (150)
99,027 89,954 95,759
Total Liabilities and Stockholders' Equity $1,146,898 $1,148,551 $1,139,397
Consolidated Statements of Income Colony Bankcorp, Inc.
(in thousands except per share data)
Quarter Year-to-Date
Three Months Ended Twelve Months Ended
12/31/14 12/31/13 12/31/14 12/31/13
(unaudited) (audited) (unaudited) (audited)
Interest Income
Loans, Including Fees $9,920 $10,327 $39,735 $41,350
Federal Funds Sold 9 12 32 39
Deposits with Other Banks 10 6 42 27
Investment Securities
U. S. Government Agencies 1,164 1,063 4,738 3,517
State, County and Municipal 25 30 100 124
Corporate Obligations/Asset-Backed Sec. -- 5 -- 47
Dividends on Other Investments 30 23 115 82
11,158 11,466 44,762 45,186
Interest Expense
Deposits 1,244 1,369 5,113 5,821
Borrowed Money 411 403 1,686 1,676
1,655 1,772 6,799 7,497
Net Interest Income 9,503 9,694 37,963 37,689
Provision for Loan Losses 0 285 1,308 4,485
Net Interest Income After Provision for Loan Losses 9,503 9,409 36,655 33,204
Noninterest Income
Service Charges on Deposits 1,199 1,207 4,568 4,691
Other Service Charges, Commissions and Fees 627 436 2,469 1,725
Mortgage Fee Income 109 107 420 484
Securities Gains (Losses) 23 (362) 24 (364)
Other 449 630 1,644 1,841
2,407 2,018 9,125 8,377
Noninterest Expense
Salaries and Employee Benefits 4,359 4,196 17,508 16,692
Occupancy and Equipment 994 952 4,063 3,794
Other 3,936 3,850 13,409 14,131
9,289 8,998 34,980 34,617
Income Before Income Taxes 2,621 2,429 10,800 6,964
Income Taxes 643 803 3,268 2,335
Net Income 1,978 1,626 7,532 4,629
Preferred Stock Dividends 668 385 2,689 1,509
Net Income Available to Common Shareholders $1,310 $1,241 $4,843 $3,120
Net Income Per Share of Common Stock
Basic $0.16 $0.15 $0.57 $0.37
Diluted $0.16 $0.15 $0.57 $0.37
Weighted Average Basic Shares Outstanding 8,439,258 8,439,258 8,439,258 8,439,258
Weighted Average Diluted Shares Outstanding 8,439,258 8,439,258 8,439,258 8,439,258

CONTACT: Terry L. Hester Chief Financial Officer (229) 426-6000 (Ext 6002)Source:Colony Bankcorp, Inc.