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Colony Bankcorp, Inc. Announces First Quarter Results

FITZGERALD, Ga., April 23, 2015 (GLOBE NEWSWIRE) -- Colony Bankcorp, Inc. (Nasdaq:CBAN), today reported net income available to shareholders of $1,253,000, or $0.15 per diluted share for the first quarter of 2015 compared to $814,000, or $0.10 per diluted share for the comparable 2014 period. This marked improvement of 53.93 percent in net income from the comparable year ago period was primarily driven by an increase in noninterest income and a reduction in noninterest expense. "While we had significant improvement in earnings, we also are pleased to report continued asset quality improvement. Total non-performing assets were $26.77 million at March 31, 2015 which is a reduction of 6.88 percent from the prior quarter end and 31.65 percent from the year ago period. Substandard assets to tier one capital plus loan loss reserve now stands at 29.93 percent – down from the prior year end level of 32.39 percent," said Ed Loomis, President and Chief Executive Officer. "Of significance during the quarter was a spurt in loan activity as total loans increased to $753.24 million at March 31, 2015 compared to $745.73 million at December 31, 2014. We remain optimistic that the economic stabilization underway will allow solid loan growth in 2015."

Capital

Colony continues to maintain a strong regulatory capital position to be categorized as "well-capitalized" by regulatory benchmarks. At March 31, 2015, the Company's tier one leverage ratio, tier one and total risk-based capital ratios were 11.14 percent, 16.28 percent and 17.34 percent, respectively, compared to 11.18 percent, 16.78 percent and 17.95 percent, respectively, at December 31, 2014 and to 10.62 percent, 16.09 percent and 17.34 percent, respectively, at March 31, 2014. Effective January 1, 2015, new regulatory regulations (commonly referred to as Basel III capital regulation) required new risk-weighting of certain assets and an additional capital ratio to be calculated. The common equity tier one capital ratio at March 31, 2015 of 9.76 percent exceeded the minimum requirement of 4.50 percent. The Company's capital ratios were all in excess of regulatory minimums required to be classified as "well-capitalized".

Net Interest Margin

During the first quarter of 2015, the Company reported net interest income of $9.20 million and a net interest margin of 3.43 percent compared to $9.19 million and 3.47 percent, respectively, for the comparable year ago 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. Shifting on the balance sheet from lower yielding overnight funds and bonds into loans will be beneficial in margin improvement over the course of 2015.

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 $40.52 million at March 31, 2015 compared to $43.29 million and $54.12 million, respectively, at December 31, 2014 and March 31, 2014. Substandard assets adjusted for SBA guarantees to tier one capital plus loan loss reserve ratio was 29.93%, 32.39% and 38.40%, respectively, at March 31, 2015, December 31, 2014 and March 31, 2014. Non-performing assets decreased from the previous quarter end to $26.77 million or 3.50 percent of total loans and other real estate owned as of March 31, 2015. This compares to $28.74 million or 3.80 percent and $39.16 million or 5.21 percent, respectively, as of December 31, 2014 and March 31, 2014. With continued economic stabilization, we anticipate continued improvement in our substandard assets.

Other real estate ("OREO") totaled $11.98 million at March 31, 2015 compared to $10.40 million and $14.23 million, respectively, at December 31, 2014 and March 31, 2014. The increase during the quarter was primarily the result of Colony finally being successful after almost four years in bankruptcy court of gaining control of real estate pledged on a nonperforming loan. 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 first quarter of 2015 net charge-offs were $788 thousand, or 0.11 percent of average loans as compared to net charge-offs of $423 thousand, or 0.06 percent of average loans in first quarter 2014. The loan loss reserve was $8.38 million on March 31, 2015, or 1.11 percent of total loans compared to $8.80 million, or 1.18 percent on December 31, 2014 and to $11.71 million, or 1.59 percent on March 31, 2014. Loan loss reserve methodology resulted in three months ended March 31, 2015 provision for loan losses of $362 thousand compared to $327 thousand for the comparable 2014 period. Management believes that the 2015 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 March 31, 2015.

Noninterest Income

Total noninterest income increased in the comparable periods as noninterest income for three months ended March 31, 2015 was $2.21 million compared to $2.06 million in the comparable 2014 period, or an increase of 7.27 percent. The significant increase was debit card interchange fees and ATM fees increasing $85 thousand, or 15.54 percent. Also, mortgage fee income increased $46 thousand, or 68.66 percent. Offsetting the increases was service charge fee income on deposit accounts decreasing $80 thousand, or 7.50 percent.

Noninterest Expense

Total noninterest expense decreased in the comparable periods as noninterest expense for three months ended March 31, 2015 was $8.29 million compared to $8.87 million for the comparable 2014 period, or a decrease of 6.54 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 $204 thousand in three months ended March 31, 2015 compared to $955 thousand in the comparable 2014 period, or a decrease of 78.64 percent. Salaries and employee benefit expenses remained relatively flat with an increase of 1.27 percent. Occupancy expenses decreased to $0.99 million in the three twelve month period ended March 31, 2015 compared to $1.02 million in the comparable 2014 period, or a decrease of 2.65 percent. Other noninterest expense decreased to $2.83 million compared to $3.43 million, or a decrease of 17.73 percent. While much of this reduction relates to the credit-related expense noted above, the Company also had a significant reduction in telephone expense which decreased $69 thousand, or 28.16 percent from the year ago period. Implementation of VOIP telephone system was a recent initiative that should continue to reap benefits on-going. Another initiative is the promotion of e-statements versus mailing out statements which resulted in a reduction of $16 thousand in postage expense from the year ago period, or a reduction of 18.60 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 03/31/2015 03/31/2014 03/31/2015 03/31/2014
Net Interest Income $9,202 $9,194 $9,202 $9,194
Provision for Loan Losses 362 327 362 327
Non-interest Income 2,212 2,062 2,212 2,062
Non-interest Expense 8,286 8,866 8,286 8,866
Income Taxes 883 606 883 606
Net Income 1,883 1,457 1,883 1,457
Preferred Stock Dividend 630 643 630 643
Net Income Available to Common Shareholders 1,253 814 1,253 814
QUARTER ENDED YEAR-TO-DATE
PER COMMON SHARE SUMMARY 03/31/2015 03/31/2014 03/31/2015 03/31/2014
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) $0.15 $0.10 $0.15 $0.10
Earnings Per Diluted Share (b) $0.15 $0.10 $0.15 $0.10
Common Book Value Per Share $8.81 $7.62 $8.81 $7.62
Tangible Common Book Value Per Share $8.79 $7.60 $8.79 $7.60
QUARTER ENDED YEAR-TO-DATE
OPERATING RATIOS (1) 03/31/2015 03/31/2014 03/31/2015 03/31/2014
Net Interest Margin (a) 3.43% 3.47% 3.43% 3.47%
Return on Average Assets (b) 0.44% 0.29% 0.44% 0.29%
Return on Average Total Equity (b) 4.98% 3.55% 4.98% 3.55%
Efficiency (c) 72.45% 78.56% 72.45% 78.56%
(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 03/31/2015 03/31/2014
Total Assets $1,156,711 $1,141,836
Loans, Net of Reserves 744,866 726,125
Allowance for Loan Losses 8,377 11,710
Intangible Assets 143 179
Deposits 985,856 976,854
Common Shareholders' Equity 74,363 64,348
Common Equity to Total Assets 6.43% 5.64%
Total Equity 102,363 92,348
Total Equity to Total Assets 8.85% 8.09%
QUARTER ENDED YEAR-TO-DATE
AVERAGE BALANCES 03/31/2015 03/31/2014 03/31/2015 03/31/2014
Total Assets $1,150,662 $1,133,529 $1,150,662 $1,133,529
Loans, Net of Reserves 743,457 728,640 743,457 728,640
Deposits 979,141 969,439 979,141 969,439
Common Shareholders' Equity 72,627 63,661 72,627 63,661
Total Equity 100,627 91,661 100,627 91,661
QUARTER ENDED YEAR-TO-DATE
ASSET QUALITY 03/31/2015 03/31/2014 03/31/2015 03/31/2014
Nonperforming Loans $14,787 $24,935 $14,787 $24,935
Nonperforming Assets 26,766 39,162 26,766 39,162
Substandard Assets 40,524 54,124 40,524 54,124
Net Loan Chg-offs (Recoveries) 788 423 788 423
Reserve for Loan Loss to Total Loans 1.11% 1.59% 1.11% 1.59%
Reserve for Loan Loss to Non- performing Loans 56.65% 46.96% 56.65% 46.96%
Reserve for Loan Loss to Non-performing Assets 31.30% 29.90% 31.30% 29.90%
Net Loan Chg-offs (Recoveries) to Avg. Total Loans 0.11% 0.06% 0.11% 0.06%
Nonperforming Loans to Total Loans 1.96% 3.38% 1.96% 3.38%
Nonperforming Assets to Total Assets 2.31% 3.43% 2.31% 3.43%
Nonperforming Assets to Total Loans And Other Real Estate 3.50% 5.21% 3.50% 5.21%
Substandard Assets to Tier One Capital and Allowance for Loan Losses 29.93% 38.40% 29.93% 38.40%
Quarterly Comparative Data (in thousands, except per share data)
1Q2015 4Q2014 3Q2014 2Q2014 1Q2014
Assets $1,156,711 $1,146,898 $1,114,414 $1,118,382 $1,141,836
Loans 744,866 736,930 733,139 724,939 726,125
Deposits 985,856 979,304 941,200 948,269 976,854
Common Shareholders' Equity 74,363 71,027 68,272 67,210 64,348
Total Equity 102,363 99,027 96,272 95,210 92,348
Net Income 1,883 1,978 2,081 2,016 1,457
Net Income Available to Common Shareholders 1,253 1,310 1,384 1,335 814
Net Income Per Share 0.15 0.16 0.16 0.16 0.10
Key Performance Ratios 1Q2015 4Q2014 3Q2014 2Q2014 1Q2014
Return on Average Assets (1) 0.44% 0.46% 0.49% 0.47% 0.29%
Return on Average Total Equity (1) 4.98% 5.37% 5.78% 5.69% 3.55%
Common Equity to Total Assets 6.43% 6.18% 6.13% 6.01% 5.64%
Total Equity to Total Assets 8.85% 8.62% 8.64% 8.51% 8.09%
Net Interest Margin 3.43% 3.59% 3.73% 3.61% 3.47%
(1) Computed using net income available to shareholders
Consolidated Balance Sheets Colony Bankcorp, Inc.
(in thousands)
Mar. 31, 2015 Dec. 31, 2014 Mar. 31, 2014
(unaudited) (audited) (unaudited)
ASSETS
Cash and Cash Equivalents
Cash and Due from Banks $20,407 $24,473 $20,592
Federal Funds Sold -- 20,132 18,183
20,407 44,605 38,775
Interest-Bearing Deposits 42,312 21,206 22,401
Investment Securities
Available for Sale, at Fair Value 279,139 274,594 278,957
Held for Maturity, at Cost (Fair Value of $31, $30 and $38 as of Mar. 31, 2015, Dec. 31, 2014, and Mar. 31, 2014, Respectively) 31 30 38
279,170 274,624 278,995
Federal Home Loan Bank Stock, at Cost 2,731 2,831 2,831
Loans 753,634 746,094 738,194
Allowance for Loan Losses (8,377) (8,802) (11,710)
Unearned Interest and Fees (391) (362) (359)
744,866 736,930 726,125
Premises and Equipment 24,745 24,960 24,637
Other Real Estate 11,979 10,402 14,227
Other Intangible Assets 143 152 179
Other Assets 30,358 31,188 33,666
Total Assets $1,156,711 $1,146,898 $1,141,836
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits
Noninterest-Bearing $128,584 $128,340 $119,984
Interest-Bearing 857,272 850,963 856,870
985,856 979,303 976,854
Borrowed Money
Subordinated Debentures 24,229 24,229 24,229
Other Borrowed Money 40,000 40,000 40,000
64,229 64,229 64,229
Other Liabilities 4,263 4,339 8,405
Stockholders' Equity
Preferred Stock, Stated Value $1,000 a Share; Authorized 10,000,000 Shares, Issued 28,000 Shares 28,000 28,000 28,000
Common Stock, Par Value $1 a share; Authorized 20,000,000 Shares, Issued 8,439,258 Shares as of Mar. 31, 2015, Dec. 31, 2014 and Mar. 31, 2014, Respectively 8,439 8,439 8,439
Paid in Capital 29,145 29,145 29,145
Retained Earnings 39,542 38,288 34,259
Accumulated Other Comprehensive Loss, Net of Tax (2,763) (4,845) (7,495)
102,363 99,027 92,348
Total Liabilities and Stockholders' Equity $1,156,711 $1,146,898 $1,141,836
Consolidated Statements of Income Colony Bankcorp, Inc.
(in thousands except per share data)
Quarter Year-to-Date
Three Months Ended Three Months Ended
03/31/2015 03/31/2014 03/31/2015 03/31/2014
(unaudited) (unaudited) (unaudited) (unaudited)
Interest Income
Loans, Including Fees $9,709 $9,689 $9,709 $9,689
Federal Funds Sold 15 9 15 9
Deposits with Other Banks 17 13 17 13
Investment Securities
U. S. Government Agencies 1,070 1,184 1,070 1,184
State, County and Municipal 25 28 25 28
Dividends on Other Investments 30 30 30 30
10,866 10,953 10,866 10,953
Interest Expense
Deposits 1,219 1,321 1,219 1,321
Borrowed Money 445 438 445 438
1,664 1,759 1,664 1,759
Net Interest Income 9,202 9,194 9,202 9,194
Provision for Loan Losses 362 327 362 327
Net Interest Income After Provision for Loan Losses 8,840 8,867 8,840 8,867
Noninterest Income
Service Charges on Deposits 987 1,067 987 1,067
Other Service Charges, Commissions and Fees 662 581 662 581
Mortgage Fee Income 113 67 113 67
Securities Gains (Losses) 3 -- 3 --
Other 447 347 447 347
2,212 2,062 2,212 2,062
Noninterest Expense
Salaries and Employee Benefits 4,468 4,412 4,468 4,412
Occupancy and Equipment 993 1,020 993 1,020
Other 2,825 3,434 2,825 3,434
8,286 8,866 8,286 8,866
Income Before Income Taxes 2,766 2,063 2,766 2,063
Income Taxes 883 606 883 606
Net Income 1,883 1,457 1,883 1457
Preferred Stock Dividends 630 643 630 643
Net Income Available to Common Shareholders $1,253 $814 $1,253 $814
Net Income Per Share of Common Stock
Basic $0.15 $0.10 $0.15 $0.10
Diluted $0.15 $0.10 $0.15 $0.10
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.