×

Southwest Georgia Financial Corporation Net Income Grows 15.4% in First Quarter 2015

MOULTRIE, Ga., April 22, 2015 (GLOBE NEWSWIRE) -- Southwest Georgia Financial Corporation (the "Corporation") (NYSE MKT:SGB), a full-service community bank holding company, today reported its results of operations for the first quarter ended March 31, 2015.

First Quarter Income Highlights

  • Net income increased 15.4% to $809 thousand, or $0.32 per diluted share, from $701 thousand, or $0.28 per diluted share, in the first quarter of 2014.
  • Net interest income improved 7.2% to $3.4 million when compared with last year's first quarter, due to lower interest expense and higher interest income. The provision for loan loss was reduced more than 50% to $45 thousand due to improved asset quality.
  • Noninterest income declined to $1.2 million for the first quarter of 2015, primarily due to a $155 thousand net gain on the sale of securities that benefited the prior-year period. Decreased mortgage banking income was partially offset by higher income from trust, brokerage and insurance services.
  • Noninterest expense fell slightly to $3.5 million as lower personnel expenses more than offset higher occupancy, data processing and equipment expenses.

Balance Sheet Trends and Asset Quality

  • Total assets at March 31, 2015 were $399.9 million, up from $394.8 million at March 31, 2014. The change in asset mix reflects higher loans and investment securities and decreased overnight balances.
  • Investment securities increased $19.1 million to $118.7 million compared with the first quarter last year. The portfolio was rebalanced in anticipation of an expected rise in short term rates and a flattening of the yield curve. Most of the investment securities growth occurred in the intermediate term.
  • Total loans grew $7.3 million to $230.2 million compared with first quarter 2014, contributing to increased revenue in spite of lower yields.
  • Deposits grew $3.9 million to $334.8 million compared with the first quarter of 2014 on higher noninterest-bearing and NOW accounts.
  • Asset quality remains strong with extraordinarily low levels of non-performing assets.

Capital Management

  • The Corporation has a Total Risk-Based Capital Ratio of 15.52% and a Leverage Capital Ratio of 8.96%, both measurably above the federal "well capitalized" standard.
  • Return on equity increased to 9.21% compared with 8.71% in the first quarter of 2014.
  • Tangible book value per share at March 31, 2015 was $13.85, up 9.5% from $12.65 in first quarter of 2014.

"Our solid execution, community bank business model, and our focus on deepening customer relationships have driven our strong performance. We are growing low-cost core funding and originating high quality loans. We are particularly encouraged by the year-over-year loan growth, which reflects new lending activity across our entire footprint," commented DeWitt Drew, President and CEO. "We will continue to proactively manage our asset mix to be in a position to drive expansion of our net interest margin when the interest rate environment improves. Additionally, we expect to benefit from what appears to be a strengthening of our local economies, in spite of a slight weakening in the agricultural sector."

Dividends

In March 2015, the Corporation paid a first quarter cash dividend of $0.10 per common share, an increase from $0.08 per common share paid quarterly in 2014. Southwest Georgia Financial Corporation or its predecessor, Southwest Georgia Bank, has paid cash dividends for 87 consecutive years.

About Southwest Georgia Financial Corporation

Southwest Georgia Financial Corporation is a state-chartered bank holding company with approximately $400 million in assets headquartered in Moultrie, Georgia. Its primary subsidiary, Southwest Georgia Bank, offers comprehensive financial services to consumer, business, and governmental customers. The current banking facilities include the main office located in Colquitt County, and branch offices located in Baker County, Worth County, and Lowndes County. In addition to conventional banking services, the bank provides investment planning and management, trust management, and commercial and individual insurance products. Insurance products and advice are provided by Southwest Georgia Insurance Services which is located in Colquitt County.

More information on Southwest Georgia Financial Corp. and Southwest Georgia Bank can be found at its website: www.sgfc.com.

SAFE HARBOR STATEMENT

This news release contains forward-looking statements, as defined by federal securities laws, including statements about the Company's financial outlook. These statements are based on current expectations and are provided to assist in the understanding of future financial performance. Such performance involves risks and uncertainties that may cause actual results to differ materially from those expressed or implied in any such statements. For a discussion of some risks and other factors that could cause the Company's actual results to differ materially from such statements, please refer to the Company's filings with the Securities and Exchange Commission, including its Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q under the sections entitled "Forward-Looking Statements" and "Risk Factors". The Company undertakes no obligation to update any forward-looking statements as a result of new information, future events or otherwise, except as otherwise required by law.

Financial tables follow.

SOUTHWEST GEORGIA FINANCIAL CORPORATION
CONSOLIDATED STATEMENT OF CONDITION
(Dollars in thousands except per share data)
(Unaudited) (Audited) (Unaudited)
March 31, December 31, March 31,
2015 2014 2014
ASSETS
Cash and due from banks $ 7,712 $ 6,783 $ 8,279
Interest-bearing deposits in banks 21,942 5,776 39,999
Certificates of deposit in other banks 1,470 1,470 3,430
Investment securities available for sale 55,313 53,838 40,654
Investment securities held to maturity 63,397 61,588 58,974
Federal Home Loan Bank stock, at cost 1,560 1,560 1,641
Loans, less unearned income and discount 230,160 224,400 222,828
Allowance for loan losses (3,134) (3,114) (3,073)
Net loans 227,026 221,286 219,755
Premises and equipment 11,653 11,756 10,908
Foreclosed assets, net 186 274 609
Intangible assets 63 66 78
Bank owned life insurance 5,120 5,104 4,993
Other assets 4,452 4,779 5,465
Total assets $ 399,894 $ 374,280 $ 394,785
LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits:
NOW accounts $ 28,690 $ 22,890 $ 21,435
Money market 101,571 99,918 103,211
Savings 29,385 28,156 30,112
Certificates of deposit $100,000 and over 30,923 31,367 32,629
Other time accounts 46,814 46,300 47,998
Total interest-bearing deposits 237,383 228,631 235,385
Noninterest-bearing deposits 97,400 81,343 95,480
Total deposits 334,783 309,974 330,865
Other borrowings 5,133 5,133 11,800
Long-term debt 22,067 22,067 17,200
Accounts payable and accrued liabilities 2,574 2,771 2,613
Total liabilities 364,557 339,945 362,478
Shareholders' equity:
Common stock - par value $1; 5,000,000 shares authorized; 4,293,835 shares issued (*) 4,294 4,294 4,294
Additional paid-in capital 31,701 31,701 31,701
Retained earnings 25,569 25,015 23,425
Accumulated other comprehensive income (113) (561) (999)
Total 61,451 60,449 58,421
Treasury stock - at cost (**) (26,114) (26,114) (26,114)
Total shareholders' equity 35,337 34,335 32,307
Total liabilities and shareholders' equity $ 399,894 $ 374,280 $ 394,785
* Common stock - shares outstanding 2,547,837 2,547,837 2,547,837
** Treasury stock - shares 1,745,998 1,745,998 1,745,998
SOUTHWEST GEORGIA FINANCIAL CORPORATION
CONSOLIDATED INCOME STATEMENT (unaudited*)
(Dollars in thousands except per share data)
For the Three Months
Ended March 31,
Interest income: 2015* 2014*
Interest and fees on loans $3,002 $2,949
Interest and dividend on securities available for sale 300 220
Interest on securities held to maturity 358 343
Dividends on Federal Home Loan Bank stock 19 11
Interest on deposits in banks 14 21
Interest on certificates of deposit in other banks 3 9
Total interest income 3,696 3,553
Interest expense:
Interest on deposits 190 195
Interest on other borrowings 14 103
Interest on long-term debt 112 103
Total interest expense 316 401
Net interest income 3,380 3,152
Provision for loan losses 45 105
Net interest income after provision for losses on loans 3,335 3,047
Noninterest income:
Service charges on deposit accounts 292 324
Income from trust services 70 55
Income from retail brokerage services 94 92
Income from insurance services 389 361
Income from mortgage banking services 78 135
Net gain (loss) on the sale or disposition of assets 19 0
Net gain on the sale of securities 0 155
Other income 219 220
Total noninterest income 1,161 1,342
Noninterest expense:
Salary and employee benefits 2,010 2,069
Occupancy expense 280 252
Equipment expense 218 217
Data processing expense 293 273
Amortization of intangible assets 4 33
Other operating expense 682 658
Total noninterest expense 3,487 3,502
Income before income tax expense 1,009 887
Provision for income taxes 200 186
Net income $809 $701
Net income per share, basic $0.32 $0.28
Net income per share, diluted $0.32 $0.28
Dividends paid per share $0.10 $0.08
Basic weighted average shares outstanding 2,547,837 2,547,837
Diluted weighted average shares outstanding 2,547,837 2,547,837
SOUTHWEST GEORGIA FINANCIAL CORPORATION
Financial Highlights
(Dollars in thousands except per share data)
At March 31 2015 2014
Assets $399,894 $394,785
Loans, less unearned income & discount $230,160 $222,828
Deposits $334,783 $330,865
Shareholders' equity $35,337 $32,307
Three Months Ended March 31,
2015 2014
Performance Data & Ratios
Net income $809 $701
Earnings per share, basic $0.32 $0.28
Earnings per share, diluted $0.32 $0.28
Dividends paid per share $0.10 $0.08
Return on assets 0.82% 0.72%
Return on equity 9.21% 8.71%
Net interest margin (tax equivalent) 3.96% 3.78%
Dividend payout ratio 31.50% 29.07%
Efficiency ratio 73.57% 74.98%
Asset Quality Data & Ratios
Total nonperforming loans $528 $104
Total nonperforming assets $714 $713
Net loan charge offs $25 $109
Reserve for loan losses to total loans 1.36% 1.38%
Nonperforming loans/total loans 0.23% 0.05%
Nonperforming assets/total assets 0.18% 0.18%
Net charge offs / average loans 0.04% 0.20%
Capital Ratios
Average common equity to average total assets 8.89% 8.30%
Common equity Tier 1 capital ratio 14.27%
Tier 1 capital ratio 14.27% 14.05%
Tier 1 leverage ratio 8.96% 8.87%
Total risk based capital ratio 15.52% 15.30%
Book value per share $13.87 $12.68
Tangible book value per share $13.85 $12.65
Quarterly 1st Qtr 4th Qtr 3rd Qtr 2nd Qtr 1st Qtr
Averages 2015 2014 2014 2014 2014
Assets $395,220 $381,239 $374,509 $384,745 $387,889
Loans, less unearned income & discount $225,665 $223,906 $225,934 $223,348 $219,971
Deposits $330,394 $313,595 $309,953 $326,773 $322,888
Equity $35,134 $34,186 $33,579 $32,926 $32,184
Return on assets 0.82% 0.69% 0.86% 0.77% 0.72%
Return on equity 9.21% 7.75% 9.57% 8.95% 8.71%
Net income $809 $662 $804 $737 $701
Net income per share, basic $0.32 $0.26 $0.32 $0.28 $0.28
Net income per share, diluted $0.32 $0.26 $0.32 $0.28 $0.28
Dividends paid per share $0.10 $0.08 $0.08 $0.08 $0.08

CONTACT: George R. Kirkland Executive Vice President and Treasurer Phone: (229) 873-3830 investorinfo@sgfc.com

Source:Southwest Georgia Financial Corporation