8-K
COLONY BANKCORP INC (CBAN)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event Reported): July 22, 2021
COLONY BANKCORP, INC.
(Exact Name of Registrant as Specified in its Charter)
| Georgia | 000-12436 | 58-1492391 |
|---|---|---|
| (State or Other Jurisdiction of Incorporation) | (Commission File Number) | (I.R.S. Employer Identification Number) |
115 South Grant Street, Fitzgerald, Georgia 31750
(Address of Principal Executive Offices) (Zip Code)
(229) 426-6000
(Registrant's telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|---|---|
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each Class | Trading Symbol(s) | Name of each exchange on which registered |
|---|---|---|
| Common stock, par value $1.00 per share | CBAN | The NASDAQ Stock Market LLC |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter). Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02. Results of Operation and Financial Condition
On July 22, 2021, the Colony Bankcorp, Inc. (the “Company”) issued a press release announcing its consolidated financial results for the second quarter ended June 30, 2021, as well as the announcement of a regular quarterly cash dividend. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.
The information in this Item 2.02, including Exhibit 99.1, is being furnished pursuant to Item 2.02 of Form 8-K and shall not be deemed “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to liabilities of that section, nor shall it be deemed incorporated by reference into any filing under the Securities Act or the Exchange Act, unless specifically identified therein as being incorporated therein by reference.
Item 7.01. Regulation FD Disclosure
The Company is furnishing a copy of its most recent investor presentation, which it intends to use in connection with certain community group presentations. A copy of the presentation materials to be used by the Company is furnished as Exhibit 99.2 to this Current Report and is incorporated herein by reference.
In accordance with General Instruction B.2 of Form 8-K, the information in this Current Report on Form 8-K, including Exhibits 99.1 and 99.2 attached hereto, is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such filing
Item 9.01 Financial Statements and Exhibits
(d)Exhibits.
| Exhibit Number | Description |
|---|---|
| 99.1 | Colony Bankcorp, Inc., press release dated August 22, 2021 |
| 99.2 | Investor Presentation dated August 22, 2021 |
| 104 | Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline<br>XBRL document. |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| COLONY BANKCORP, INC. | ||
|---|---|---|
| Date: July 22, 2021 | By: | /s/ Tracie Youngblood |
| Tracie Youngblood | ||
| Executive Vice President and Chief Financial Officer |
Document
For additional information, contact:
Tracie Youngblood
EVP & Chief Financial Officer
(229) 426-6000 (Ext 6003)
COLONY BANKCORP REPORTS SECOND QUARTER 2021 RESULTS
DECLARES QUARTERLY CASH DIVIDEND OF $0.1025 PER SHARE
FITZGERALD, GA. (July 22, 2021) – Colony Bankcorp, Inc. (Nasdaq: CBAN) (“Colony” or the “Company”) today reported net income of $4.0 million, or $0.42 per diluted share, for the quarter ended June 30, 2021, compared with $2.2 million, or $0.23 per diluted share, for the quarter ended June 30, 2020. The Company reported operating net income of $4.6 million, or $0.49 per diluted share, for the quarter ended June 30, 2021, compared with $2.4 million, or $0.25 per diluted share for the same period in 2020. Operating net income for June 30, 2021 and 2020 excludes pre-tax acquisition related expenses, and the net income tax benefit for these adjustments.
For the six months ended June 30, 2021, the Company reported net income of $8.9 million, or $0.94 per diluted share, compared to $3.5 million, or $0.40 per diluted share, for the same period in 2020. The Company reported operating net income of $9.7 million, or $1.02 adjusted earnings per diluted share, for the six months ended June 30, 2021, compared to $4.2 million, or $0.44 adjusted earnings per diluted share, for the same period in 2020.
Second Quarter 2021 Financial Highlights:
•Net income was $4.0 million, or $0.42 per diluted share compared to $2.2 million, or $0.23 per diluted share for the second quarter of 2020.
•Operating net income of $4.6 million, or $0.49 per diluted share, (see Non-GAAP reconciliation).
•No provision for loan losses was recorded in second quarter, a decrease of $500,000, or 100%, compared to the first quarter of 2021.
•Mortgage production was $151.4 million, with $37.7 million in refinances, $103.4 million in purchases, and $10.3 million in construction related loans.
•Small Business Specialty Lending (“SBSL”) closed $15.1 million in SBA loans and sold $9.3 million in SBA loans.
The Company also announced that on July 22, 2021, the Board of Directors declared a quarterly cash dividend of $0.1025 per share, to be paid on its common stock on August 17, 2021, to shareholders of record as of the close of business on August 3, 2021. Outstanding shares as of July 1, 2021 were 9,686,383.
Commenting on the announcement, Heath Fountain, President and Chief Executive Officer, said, “As we moved to a more open economy from the global pandemic, we delivered strong growth in earnings for the second quarter of 2021 compared to the same period last year. Diluted earnings per share increased 81% for the second quarter year over year to $0.42 per diluted share. Our team continued to do a great job serving clients as shown by increased levels of our non-interest income for the period mentioned. Mortgage fee income increased 65% year over year as a result of historically low interest rates and consumer demand, a tribute also to our strategic vision to diversify our revenues. Diluted earnings per share decreased on a sequential quarter basis primarily due to acquisition costs related to our proposed acquisitions of SouthCrest Financial Group, Inc. (PK: SCSG) (“SouthCrest”) and The Barnes Agency (“Barnes”), both with anticipated closings on or before August 1, 2021. Adjusted earnings also increased for the year over year period to $0.49 from $0.25, and decreased 8% from the prior quarter primarily due to increased operating expenses.
“Building a world class organization and recruiting the best of people, we have been very busy at Colony these last several months. The recently announced acquisition of SouthCrest allows us to optimize our balance sheet, further invest in Colony and become a more efficient organization due to the synergies we will experience. In furtherance of our strategic plan, we believe our newly formed Colony Insurance subsidiary operating as an Allstate agency, diversifies our revenue stream by increasing non interest income as well as cross-selling of product lines.
Furthermore, I am pleased that R. Dallis “D” Copeland, Jr., agreed to join our organization as Special Advisor. D has over 27 years of banking experience at a $45 billion balance sheet financial institution in all areas including commercial real estate, corporate and retail banking, private wealth, credit card, treasury management and strategy. We anticipate leveraging his many skills to continue to build our organization.
“Our balance sheet remains solid with strong credit metrics, as evidenced by no provision for loan losses as well as net recoveries in our loan portfolio for the period ended June 30, 2021. We experienced solid core loan growth while total deposits increased to $1.5 billion, a record for the company. Average interest-bearing deposits increased $77.0 million year over year with most of the increase in lower-yielding demand and savings accounts. Total assets were fairly flat from last year with the prior year period having strong demand for Paycheck Protection Program (“PPP”) loans.
“Net interest income increased 11% year-over-year primarily due to loan fee income recognized on PPP loans forgiven, as well as lower costs of interest bearing liabilities. Our cost related to demand and savings deposits rate was down 15 basis points to 0.07% and total average deposits cost this quarter decreased 33 basis points to 0.20% from the same period last year. The team has done a great job of attracting more deposits while maintaining a strong cost discipline. Moreover, while many banks are reporting decreases in their net interest margin, I am pleased to report our net interest margin increased to 3.68% from 3.46% year over year attributable to lower costs of interest bearing liabilities. While we have experienced inflation across many sectors of the economy, the Federal Reserve Board has so far not increased interest rates and we continue to closely monitor the situation.
“Noninterest income saw very strong growth, increasing 60% year over year, with mortgage fee income increasing to $3.0 million in the current quarter compared to $1.8 million in the second quarter of 2020. Service charges on deposits had a strong quarter increasing 16% over the same period last year. The increase in noninterest income was offset by increases in noninterest expense, such as salaries and employee benefits, information technology expenses as well as elevated acquisition related expenses.
“Our allowance for loan and lease losses now represents 1.26% of total loans outstanding, an increase from 0.92% in the year-earlier quarter and 1.19% on a sequential-quarter basis. Total nonperforming assets decreased to 0.54% of total assets from 0.75% in the year-earlier quarter and from 0.62% on a sequential-quarter basis.
“Average interest earning assets of $1.7 billion increased $80.0 million, or 5%, while total assets remained stable at $1.8 billion. Total loans, including acquisition activity and loans from the Small Business Administration Paycheck Protection Program (“PPP”), decreased 8% year-over-year, while organic loan growth increased 6%.
In closing, Fountain added, “Our management team and Board are always focused on investing, innovating and making strategic decisions to better serve our customers, employees and communities. The acquisitions of SouthCrest and The Barnes Agency will make us the number one community bank in Georgia as well as expand our reach into consumer insurance. We welcome new customers by offering a wide range of financial products and services as well as demonstrating new product lines to our existing customers. All of us at Colony look forward to integrating the SouthCrest and Barnes acquisitions, while continuing to reward our shareholders.”
Balance Sheet
•Total assets totaled $1.8 billion at June 30, 2021, a decrease of $22.1 million, or 1.2%, compared to the same period in 2020. The decrease was primarily related to PPP loans being forgiven beginning in the third quarter of 2020.
•Interest-bearing deposits in banks and federal funds sold at June 30, 2021, totaled $129.4 million, a decrease of $44.4 million, or 25.5% compared to the same period in 2020. The decrease is primarily attributable to the deployment of funds that came from PPP loans and the repayment of Paycheck Protection Program Liquidity Facility (“PPLF”).
•Total loans, including loans held for sale, totaled $1.05 billion at June 30, 2021, a decrease of $77.0 million, or 6.81% from the same period in 2020. Legacy loan growth was up $50.3 million or 5.9% compared to the same period in 2020.
•Deposits totaled $1.54 billion at June 30, 2021, an increase of $120.5 million, or 8.5%, compared to the same period in 2020. The increase in deposits was primarily in noninterest-bearing and interest bearing demand deposits as a result of the PPP loan activity during 2020 and 2021.
•Total borrowings at June 30, 2021, totaled $59.8 million, a decrease of $149.5 million, or 71.4%, compared to the same period in 2020. At June 30, 2021, the PPPLF was completely paid off in the second quarter of 2021.
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 8.45%, 13.41%, 14.56%, and 11.31%, respectively at June 30, 2021.
Second Quarter Results of Operations
•Net interest income on a tax-equivalent basis for the second quarter 2021 totaled $15.2 million, compared to $13.6 million for the second quarter 2020. The increase during the quarter is primarily attributable to loan fee income recognized on PPP loans forgiven and a decrease in the cost of interest-bearing liabilities.
•Net interest margin was up 18 basis points over the sequential quarter primarily driven by an increase in deferred fee income recognized on PPP loans partially offset by reductions in loan rates driven by Federal Reserve interest rate decreases during 2020. During the quarter ended June 30, 2021, PPP loans totaling approximately $44.6 million were forgiven through the SBA.
•Noninterest income totaled $7.8 million for the second quarter ended June 30, 2021, an increase of $2.9 million, or 60.05%, compared to the same period in 2020. The increase was primarily attributable to growth in mortgage production income as a result of increased loan demand resulting from a historically low interest rate environment.
•Noninterest expense totaled $17.5 million for the second quarter ended June 30, 2021, compared to $13.4 million for the same period in 2020. The increase in noninterest expense primarily resulted from a $2.4 million increase in salary expense largely related to the increase in mortgage and SBSL loan production.
Asset Quality
•Nonperforming assets totaled $9.5 million and $11.2 million at June 30, 2021 and March 31, 2021, respectively.
•OREO and repossessed assets totaled $299,000 at June 30, 2021, a decrease of $248,000, or 45% compared to March 31, 2021.
•Net loan recoveries were $244,000, or (0.09%) of average loans for the second quarter of 2021, compared to net charge-offs of $66,000 in the first quarter of 2021.
•The loan loss reserve was $12.9 million, or 1.26% of total loans, at June 30, 2021, compared to $12.7 million, or 1.14% of total loans, at March 31, 2021.
Asset quality remains strong as indicated by the overall improvement in asset quality ratios as of the second quarter 2021 on a year-over-year comparison along with a decrease in nonperforming assets. .
About Colony Bankcorp
Colony Bankcorp, Inc. is the bank holding company for Colony Bank. Founded in 1975 and headquartered in Fitzgerald, Georgia, Colony operates 29 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; (vi) statements relating to the timing, benefits, costs, and synergies of the proposed merger with SouthCrest (the “Merger”) and the proposed acquisition of Barnes; and (vii) 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 risk that the cost savings and any revenue synergies from the Merger and the acquisition of Barnes may not be realized or take longer than anticipated; disruption from the Merger and the acquisition of Barnes with customers, suppliers, employee or other business partners relationships; the occurrence of any event, change or circumstances that could give rise to the termination of the merger agreement with SouthCrest; the risk of successful integration of SouthCrest’s and Barnes’ businesses into the Company; the amount of the costs, fees, expenses and charges related to the Merger and the acquisition of Barnes; reputation risk and the reaction of each of the Company’s and SouthCrest’s customers, suppliers, employees or other business partners to the Merger; the failure of the closing conditions in the merger agreement with SouthCrest to be satisfied, or any unexpected delay in closing of the Merger; the risk that the integration of SouthCrest’s operations into the operations of the Company will be materially delayed or will be more costly or difficult than expected; the possibility that the Merger may be more expensive to complete than anticipated, including as a result of unexpected factors or events; the dilution caused by the Company’s issuance of additional shares of its common stock in the Merger; the risks associated with the Company’s pursuit of future acquisitions; and general competitive, economic, political and market conditions. . 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, 2020, 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 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 | |||||||||||||||
| 2021 | 2020 | ||||||||||||||
| (dollars in thousands, except per share data) | Second Quarter | First Quarter | Fourth Quarter | Third Quarter | Second Quarter | ||||||||||
| Operating net income reconciliation | |||||||||||||||
| Net income (GAAP) | $ | 3,997 | $ | 4,919 | $ | 4,900 | $ | 3,098 | $ | 2,214 | |||||
| Acquisition-related expenses | 865 | 176 | 148 | 207 | 220 | ||||||||||
| Thomaston building write down | — | — | — | 582 | — | ||||||||||
| Gain on sale of Thomaston branch | — | — | (1,026) | — | — | ||||||||||
| Income tax expense (benefit) | (225) | (46) | 184 | (166) | (46) | ||||||||||
| Operating net income | $ | 4,637 | $ | 5,049 | $ | 4,206 | $ | 3,721 | $ | 2,388 | |||||
| Weighted average diluted shares | 9,498,783 | 9,498,783 | 9,498,783 | 9,498,783 | 9,498,783 | ||||||||||
| Adjusted earnings per diluted share | $ | 0.49 | $ | 0.53 | $ | 0.44 | $ | 0.39 | $ | 0.25 | |||||
| Tangible book value per common share reconciliation | |||||||||||||||
| Book value per common share (GAAP) | $ | 15.46 | $ | 15.11 | $ | 15.21 | $ | 14.78 | $ | 14.59 | |||||
| Effect of goodwill and other intangibles | (1.97) | (1.97) | (1.95) | (1.96) | (1.96) | ||||||||||
| Tangible book value per common share | $ | 13.50 | $ | 13.14 | $ | 13.26 | $ | 12.82 | $ | 12.63 | |||||
| Operating efficiency ratio calculation | |||||||||||||||
| Efficiency ratio (GAAP) | 76.53 | % | 69.04 | % | 68.93 | % | 76.22 | % | 72.75 | % | |||||
| Acquisition-related expenses | (3.44) | (0.46) | (0.64) | (0.97) | (1.20) | ||||||||||
| Gain on sale of Thomaston branch | — | % | — | % | 3.19 | % | — | % | — | % | |||||
| Thomaston building write down | — | % | — | % | — | % | (2.72) | % | — | % | |||||
| Operating efficiency ratio | 73.10 | % | 68.58 | % | 71.49 | % | 72.53 | % | 71.55 | % | |||||
| Colony Bankcorp, Inc. | |||||||||||||||
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| Selected Financial Information | |||||||||||||||
| 2021 | 2020 | ||||||||||||||
| (dollars in thousands, except per share data) | Second Quarter | First Quarter | Fourth Quarter | Third Quarter | Second Quarter | ||||||||||
| EARNINGS SUMMARY | |||||||||||||||
| Net interest income | $ | 15,069 | $ | 14,283 | $ | 15,151 | $ | 13,848 | $ | 13,541 | |||||
| Provision for loan losses | — | 500 | 1,296 | 1,106 | 2,200 | ||||||||||
| Non-interest income | 7,751 | 8,576 | 8,039 | 6,930 | 4,843 | ||||||||||
| Non-interest expense | 17,465 | 15,782 | 15,986 | 15,690 | 13,375 | ||||||||||
| Income taxes | 1,358 | 1,658 | 1,008 | 884 | 595 | ||||||||||
| Net income | 3,997 | 4,919 | 4,900 | 3,098 | 2,214 | ||||||||||
| 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 | 9,498,783 | 9,498,783 | ||||||||||
| Weighted average diluted shares | 9,498,783 | 9,498,783 | 9,498,783 | 9,498,783 | 9,498,783 | ||||||||||
| Earnings per basic share | $ | 0.42 | $ | 0.52 | $ | 0.52 | $ | 0.33 | $ | 0.23 | |||||
| Earnings per diluted share | 0.42 | 0.52 | 0.52 | 0.33 | 0.23 | ||||||||||
| Adjusted earnings per diluted share(b) | 0.49 | 0.53 | 0.44 | 0.39 | 0.25 | ||||||||||
| Cash dividends declared per share | 0.1025 | 0.1025 | 0.1000 | 0.1000 | 0.1000 | ||||||||||
| Common book value per share | 15.46 | 15.11 | 15.21 | 14.78 | 14.59 | ||||||||||
| Tangible common book value per share(b) | 13.50 | 13.14 | 13.26 | 12.82 | 12.63 | ||||||||||
| Performance ratios: | |||||||||||||||
| Net interest margin (a) | 3.68 | % | 3.50 | % | 3.58 | % | 3.34 | % | 3.46 | % | |||||
| Return on average assets | 0.91 | 1.12 | 1.08 | 0.70 | 0.52 | ||||||||||
| Return on average total equity | 11.14 | 13.71 | 13.73 | 8.80 | 6.47 | ||||||||||
| Efficiency ratio | 76.53 | 69.04 | 68.93 | 76.22 | 72.75 | ||||||||||
| Operating efficiency ratio (b) | 73.10 | 68.58 | 71.49 | 72.53 | 71.55 | ||||||||||
| Colony Bankcorp, Inc. | |||||||||||||||
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| Selected Financial Information | |||||||||||||||
| 2021 | 2020 | ||||||||||||||
| (dollars in thousands, except per share data) | Second Quarter | First Quarter | Fourth Quarter | Third Quarter | Second Quarter | ||||||||||
| ASSET QUALITY | |||||||||||||||
| Nonperforming loans (NPLs) | $ | 9,184 | $ | 10,676 | $ | 9,128 | $ | 9,926 | $ | 11,459 | |||||
| Other real estate owned | 270 | 518 | 1,006 | 1,875 | 1,769 | ||||||||||
| Repossessed assets | 29 | 29 | 30 | 11 | 17 | ||||||||||
| Total nonperforming assets (NPAs) | 9,483 | 11,223 | 10,164 | 11,812 | 13,245 | ||||||||||
| Classified loans | 30,852 | 35,182 | 30,404 | 21,388 | 20,619 | ||||||||||
| Criticized loans | 64,818 | 80,288 | 75,633 | 72,076 | 52,200 | ||||||||||
| Net loan (recoveries)/charge-offs | (244) | (66) | 189 | 375 | 295 | ||||||||||
| Allowance for loan losses to total loans | 1.26 | % | 1.19 | % | 1.14 | % | 1.00 | % | 0.92 | % | |||||
| Allowance for loan losses to total NPLs | 140.15 | 118.89 | 132.85 | 111.02 | 89.79 | ||||||||||
| Allowance for loan losses to total NPAs | 135.73 | 113.10 | 119.31 | 93.29 | 77.68 | ||||||||||
| Net (recoveries)/charge-offs to average loans | 0.09 | (0.02) | 0.07 | 0.13 | 0.12 | ||||||||||
| NPLs to total loans | 0.90 | 1.00 | 0.86 | 0.90 | 1.03 | ||||||||||
| NPAs to total assets | 0.54 | 0.62 | 0.58 | 0.67 | 0.75 | ||||||||||
| NPAs to total loans and other real estate owned | 0.93 | 1.06 | 0.96 | 1.07 | 1.19 | ||||||||||
| AVERAGE BALANCES | |||||||||||||||
| Total assets | $ | 1,774,122 | $ | 1,774,123 | $ | 1,797,749 | $ | 1,766,717 | $ | 1,702,902 | |||||
| Loans, net | 1,076,784 | 1,079,007 | 1,151,872 | 1,130,231 | 1,094,299 | ||||||||||
| Deposits | 1,547,139 | 1,475,944 | 1,456,287 | 1,140,487 | 1,384,739 | ||||||||||
| Total stockholders’ equity | 145,515 | 145,515 | 141,570 | 139,721 | 137,213 | ||||||||||
| (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. | |||||||||||||||
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| Average Balance Sheet and Net Interest Analysis | |||||||||||||||
| Three Months Ended June 30, | |||||||||||||||
| 2021 | 2020 | ||||||||||||||
| (dollars in thousands) | Average<br>Balances | Income/<br>Expense | Yields/<br>Rates | Average<br>Balances | Income/<br>Expense | Yields/<br>Rates | |||||||||
| Assets | |||||||||||||||
| Interest-earning assets: | |||||||||||||||
| Loans, net of unearned income 1 | $ | 1,076,784 | $ | 14,165 | 5.34 | % | $ | 1,094,299 | $ | 13,763 | 5.10 | % | |||
| Investment securities, taxable | 417,343 | 1,794 | 1.74 | % | 330,649 | 1,757 | 2.16 | % | |||||||
| Investment securities, tax-exempt 2 | 33,156 | 160 | 1.96 | % | 8,959 | 46 | 2.08 | % | |||||||
| Deposits in banks and short term investments | 146,591 | 45 | 0.12 | % | 159,902 | 48 | 0.12 | % | |||||||
| Total interest-earning assets | 1,673,874 | 16,164 | 3.92 | % | 1,593,809 | 15,614 | 3.97 | % | |||||||
| Noninterest-earning assets | 100,248 | 109,093 | |||||||||||||
| Total assets | $ | 1,774,122 | $ | 1,702,902 | |||||||||||
| Liabilities and stockholders' equity | |||||||||||||||
| Interest-bearing liabilities: | |||||||||||||||
| Interest-earning demand and savings | $ | 901,978 | $ | 146 | 0.07 | % | $ | 766,692 | $ | 407 | 0.22 | % | |||
| Other time | 253,944 | 423 | 0.68 | % | 311,334 | 996 | 1.30 | % | |||||||
| Total interest-bearing deposits | 1,155,922 | 569 | 0.20 | % | 1,078,026 | 1,403 | 0.53 | % | |||||||
| Federal Home Loan Bank advances | 22,500 | 115 | 2.09 | % | 36,500 | 211 | 2.34 | % | |||||||
| Paycheck Protection Program Liquidity Facility | 19,031 | 25 | 0.53 | % | 99,124 | 87 | 0.36 | % | |||||||
| Other borrowings | 37,536 | 258 | 2.78 | % | 38,694 | 299 | 3.13 | % | |||||||
| Total other interest-bearing liabilities | 79,067 | 398 | 2.04 | % | 174,318 | 597 | 1.39 | % | |||||||
| Total interest-bearing liabilities | 1,234,989 | 967 | 0.32 | % | 1,252,344 | 2,000 | 0.65 | % | |||||||
| Noninterest-bearing liabilities: | |||||||||||||||
| Demand deposits | $ | 391,217 | $ | 306,713 | |||||||||||
| Other liabilities | 2,401 | 6,632 | |||||||||||||
| Stockholders' equity | 145,515 | 137,213 | |||||||||||||
| Total noninterest-bearing liabilities and stockholders' equity | 539,133 | 450,558 | |||||||||||||
| Total liabilities and stockholders' equity | $ | 1,774,122 | $ | 1,702,902 | |||||||||||
| Interest rate spread | 3.60 | % | 3.33 | % | |||||||||||
| Net interest income | $ | 15,197 | $ | 13,614 | |||||||||||
| Net interest margin | 3.68 | % | 3.46 | % |
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 $67,000 and $62,000 for the quarter ended June 30, 2021 and 2020, respectively, are included in income and fees on loans. Accretion income of $104,000 and $82,000 for the quarter ended June 30, 2021 and 2020 are also included in income and fees on loans.
2Taxable-equivalent adjustments totaling $43,000 and $12,000 for the quarter ended June 30, 2021 and 2020, respectively, are included in tax-exempt interest on investment securities. The adjustments are based on federal tax rate of 21% and a Georgia state tax rate of 5.75% with appropriate reductions for the effect of disallowed interest expense incurred in carrying tax-exempt obligations.
| Colony Bankcorp, Inc. | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Average Balance Sheet and Net Interest Analysis | ||||||||||||
| Six Months Ended June 30, | ||||||||||||
| 2021 | 2020 | |||||||||||
| (dollars in thousands) | Average<br>Balances | Income/<br>Expense | Yields/<br>Rates | Average<br>Balances | Income/<br>Expense | Yields/<br>Rates | ||||||
| Assets | ||||||||||||
| Interest-earning assets: | ||||||||||||
| Loans, net of unearned income3 | $ | 1,077,859 | $ | 27,805 | 5.20 | % | $ | 1,037,242 | $ | 27,114 | 5.27 | % |
| Investment securities, taxable | 394,431 | 3,401 | 1.74 | % | 335,107 | 3,649 | 2.20 | % | ||||
| Investment securities, tax-exempt4 | 32,887 | 314 | 1.93 | % | 4,941 | 54 | 2.20 | % | ||||
| Deposits in banks and short term investments | 164,882 | 97 | 0.12 | % | 122,885 | 332 | 0.54 | % | ||||
| Total interest-earning assets | 1,670,059 | 31,617 | 3.82 | % | 1,500,175 | 31,149 | 4.19 | % | ||||
| Noninterest-earning assets | 105,746 | 107,661 | ||||||||||
| Total assets | $ | 1,775,805 | $ | 1,607,836 | ||||||||
| Liabilities and stockholders' equity | ||||||||||||
| Interest-bearing liabilities: | ||||||||||||
| Interest-earning demand and savings | $ | 880,838 | $ | 311 | 0.07 | % | $ | 747,273 | $ | 1,342 | 0.36 | % |
| Other time | 257,173 | 912 | 0.72 | % | 323,073 | 2,279 | 1.42 | % | ||||
| Total interest-bearing deposits | 1,138,011 | 1,223 | 0.22 | % | 1,070,346 | 3,621 | 0.68 | % | ||||
| Federal Home Loan Bank advances | 22,500 | 230 | 2.06 | % | 41,038 | 468 | 2.30 | % | ||||
| Paycheck Protection Program Liquidity Facility | 51,516 | 205 | 0.80 | % | 49,561 | 87 | 0.35 | % | ||||
| Other borrowings | 37,715 | 402 | 2.15 | % | 38,745 | 688 | 3.58 | % | ||||
| Total other interest-bearing liabilities | 111,731 | 837 | 1.51 | % | 129,344 | 1,243 | 1.94 | % | ||||
| Total interest-bearing liabilities | 1,249,742 | 2,060 | 0.33 | % | 1,199,690 | 4,864 | 0.82 | % | ||||
| Noninterest-bearing liabilities: | ||||||||||||
| Demand deposits | $ | 373,728 | $ | 266,163 | ||||||||
| Other liabilities | 7,201 | 6,223 | ||||||||||
| Stockholders' equity | 145,136 | 135,760 | ||||||||||
| Total noninterest-bearing liabilities and stockholders' equity | 526,065 | 408,146 | ||||||||||
| Total liabilities and stockholders' equity | $ | 1,775,807 | $ | 1,607,836 | ||||||||
| Interest rate spread | 3.49 | % | 3.37 | % | ||||||||
| Net interest income | $ | 29,557 | $ | 26,285 | ||||||||
| Net interest margin | 3.57 | % | 3.53 | % |
3The 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 $133,000 and $124,000 for the six months ended June 30, 2021 and 2020, respectively, are included in income and fees on loans. Accretion income of $313,000 and $264,000 for the six months ended June 30, 2021 and 2020 are also included in income and fees on loans.
4Taxable-equivalent adjustments totaling $84,000 and $14,000 for the six months ended June 30, 2021 and 2020, respectively, are included in tax-exempt interest on investment securities. The adjustments are based on federal tax rate of 21% and a Georgia state tax rate of 5.75% with appropriate reductions for the effect of disallowed interest expense incurred in carrying tax-exempt obligations.
| Colony Bankcorp, Inc. | |||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Segment Reporting | |||||||||||||||
| 2021 | 2020 | ||||||||||||||
| (dollars in thousands) | Second Quarter | First Quarter | Fourth Quarter | Third Quarter | Second Quarter | ||||||||||
| Banking Division | |||||||||||||||
| Net interest income | $ | 14,864 | $ | 13,985 | $ | 14,752 | $ | 13,631 | $ | 13,440 | |||||
| Provision for loan losses | — | 500 | 1,296 | 1,106 | 2,200 | ||||||||||
| Noninterest income | 3,354 | 3,005 | 3,952 | 3,515 | 2,901 | ||||||||||
| Noninterest expenses | 14,366 | 11,960 | 11,656 | 11,792 | 10,158 | ||||||||||
| Income taxes | 1,241 | 1,160 | 973 | 940 | 842 | ||||||||||
| Segment income | $ | 2,611 | $ | 3,370 | $ | 4,779 | $ | 3,308 | $ | 3,141 | |||||
| Total segment assets | $ | 1,710,345 | $ | 1,755,667 | $ | 1,709,696 | $ | 1,666,742 | $ | 1,726,219 | |||||
| Full time employees | 287 | 291 | 305 | 312 | 321 | ||||||||||
| Mortgage Banking Division | |||||||||||||||
| Net interest income | $ | 123 | $ | 168 | $ | 299 | $ | 188 | $ | 82 | |||||
| Provision for loan losses | — | — | — | — | — | ||||||||||
| Noninterest income | 2,997 | 3,986 | 3,420 | 2,612 | 1,821 | ||||||||||
| Noninterest expenses | 1,887 | 2,793 | 2,835 | 2,410 | 1,697 | ||||||||||
| Income taxes | 60 | 354 | 188 | 82 | 43 | ||||||||||
| Segment income | $ | 1,173 | $ | 1,007 | $ | 696 | $ | 308 | $ | 163 | |||||
| Total segment assets | $ | 25,149 | $ | 27,478 | $ | 50,266 | $ | 50,265 | $ | 17,578 | |||||
| Full time employees | 53 | 51 | 43 | 41 | 40 | ||||||||||
| Small Business Specialty Lending Division | |||||||||||||||
| Net interest income | $ | 82 | $ | 130 | $ | 100 | $ | 29 | $ | 19 | |||||
| Provision for loan losses | — | — | — | — | — | ||||||||||
| Noninterest income | 1,400 | 1,585 | 667 | 803 | 121 | ||||||||||
| Noninterest expenses | 1,212 | 1,029 | 1,495 | 1,488 | 1,520 | ||||||||||
| Income taxes | 57 | 144 | (153) | (138) | (290) | ||||||||||
| Segment income | $ | 213 | $ | 542 | $ | (575) | $ | (518) | $ | (1,090) | |||||
| Total segment assets | $ | 20,024 | $ | 15,901 | $ | 4,012 | $ | 42,439 | $ | 33,771 | |||||
| Full time employees | 24 | 23 | 21 | 15 | 13 | ||||||||||
| Total Consolidated | |||||||||||||||
| Net interest income | $ | 15,069 | $ | 14,283 | $ | 15,151 | $ | 13,848 | $ | 13,541 | |||||
| Provision for loan losses | — | 500 | 1,296 | 1,106 | 2,200 | ||||||||||
| Noninterest income | 7,751 | 8,576 | 8,039 | 6,930 | 4,843 | ||||||||||
| Noninterest expenses | 17,465 | 15,782 | 15,986 | 15,690 | 13,375 | ||||||||||
| Income taxes | 1,358 | 1,658 | 1,008 | 884 | 595 | ||||||||||
| Segment income | $ | 3,997 | $ | 4,919 | $ | 4,900 | 3,098 | $ | 2,214 | ||||||
| Total segment assets | $ | 1,755,518 | $ | 1,799,046 | $ | 1,763,974 | $ | 1,759,446 | $ | 1,777,568 | |||||
| Full time employees | 364 | 365 | 369 | 368 | 374 | ||||||||||
| Colony Bankcorp, Inc. | |||||||||||||||
| --- | --- | --- | --- | --- | |||||||||||
| Consolidated Balance Sheets | |||||||||||||||
| June 30, 2021 | December 31, 2020 | ||||||||||||||
| (dollars in thousands) | (unaudited) | (audited) | |||||||||||||
| ASSETS | |||||||||||||||
| Cash and due from banks | $ | 16,897 | $ | 17,218 | |||||||||||
| Interest-bearing deposits in banks and federal funds sold | 129,369 | 166,288 | |||||||||||||
| Cash and cash equivalents | 146,266 | 183,506 | |||||||||||||
| Investment securities available for sale, at fair value | 469,714 | 380,814 | |||||||||||||
| Other investments, at cost | 2,703 | 3,296 | |||||||||||||
| Loans held for sale | 30,910 | 52,386 | |||||||||||||
| Loans, net of unearned income | 1,022,618 | 1,059,503 | |||||||||||||
| Allowance for loan losses | (12,871) | (12,127) | |||||||||||||
| Loans, net | 1,009,747 | 1,047,376 | |||||||||||||
| Premises and equipment | 32,689 | 32,057 | |||||||||||||
| Other real estate | 270 | 1,006 | |||||||||||||
| Goodwill and other intangible assets | 18,701 | 18,558 | |||||||||||||
| Bank owned life insurance | 31,805 | 31,547 | |||||||||||||
| Other assets | 12,713 | 13,428 | |||||||||||||
| Total assets | $ | 1,755,518 | $ | 1,763,974 | |||||||||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||||||||
| Liabilities: | |||||||||||||||
| Deposits: | |||||||||||||||
| Noninterest-bearing | $ | 393,677 | $ | 326,999 | |||||||||||
| Interest-bearing | 1,148,537 | 1,118,028 | |||||||||||||
| Total deposits | 1,542,214 | 1,445,027 | |||||||||||||
| Federal Home Loan Bank advances | 22,500 | 22,500 | |||||||||||||
| Paycheck Protection Program Liquidity Facility | — | 106,789 | |||||||||||||
| Other borrowed money | 37,292 | 37,792 | |||||||||||||
| Accrued expenses and other liabilities | 6,618 | 7,378 | |||||||||||||
| Total liabilities | $ | 1,608,624 | $ | 1,619,486 | |||||||||||
| 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 | 43,232 | 43,215 | |||||||||||||
| Retained earnings | 91,963 | 84,993 | |||||||||||||
| Accumulated other comprehensive income, net of tax | 2,200 | 6,781 | |||||||||||||
| Total stockholders’ equity | 146,894 | 144,488 | |||||||||||||
| Total liabilities and stockholders’ equity | $ | 1,755,518 | $ | 1,763,974 | |||||||||||
| Colony Bankcorp, Inc. | |||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | |||||||
| Consolidated Statements of Income (unaudited) | |||||||||||||||
| Three months ended June 30, | Six months ended June 30, | ||||||||||||||
| 2021 | 2020 | 2021 | 2020 | ||||||||||||
| (dollars in thousands, except per share data) | |||||||||||||||
| Interest income: | |||||||||||||||
| Loans, including fees | $ | 14,099 | 13,699 | $ | 27,672 | 26,989 | |||||||||
| Investment securities, including tax exempt of $126, $37, $248 and $43, respectively | 1,893 | 1,794 | 3,591 | 3,788 | |||||||||||
| Deposits in banks and short term investments | 44 | 48 | 98 | 332 | |||||||||||
| Total interest income | 16,036 | 15,541 | 31,361 | 31,109 | |||||||||||
| Interest expense: | |||||||||||||||
| Deposits | 569 | 1,403 | 1,223 | 3,622 | |||||||||||
| Federal Home Loan Bank advances | 115 | 211 | 230 | 468 | |||||||||||
| Paycheck Protection Program Liquidity Facility | 25 | 87 | 93 | 87 | |||||||||||
| Other borrowings | 258 | 299 | 515 | 688 | |||||||||||
| Total interest expense | 967 | 2,000 | 2,061 | 4,865 | |||||||||||
| Net interest income | 15,069 | 13,541 | 29,300 | 26,244 | |||||||||||
| Provision for loan losses | — | 2,200 | 500 | 4,156 | |||||||||||
| Net interest income after provision for loan losses | 15,069 | 11,341 | 28,800 | 22,088 | |||||||||||
| Noninterest income: | |||||||||||||||
| Service charges on deposits | 1,264 | 1,091 | 2,486 | 2,590 | |||||||||||
| Mortgage fee income | 3,005 | 1,827 | 7,000 | 3,089 | |||||||||||
| Gain on sale of SBA loans | 1,263 | 46 | 2,735 | 255 | |||||||||||
| (Loss)/Gain on sale of securities | 141 | — | 137 | 293 | |||||||||||
| (Loss)/Gain on sale of assets | — | 56 | — | 56 | |||||||||||
| Interchange fees | 1,667 | 1,250 | 3,197 | 2,283 | |||||||||||
| BOLI Income | 222 | 160 | 430 | 311 | |||||||||||
| Other | 189 | 413 | 367 | 212 | |||||||||||
| Total noninterest income | 7,751 | 4,843 | 16,352 | 9,089 | |||||||||||
| Noninterest expense: | |||||||||||||||
| Salaries and employee benefits | 10,126 | 7,729 | 20,081 | 15,227 | |||||||||||
| Occupancy and equipment | 1,245 | 1,316 | 2,571 | 2,634 | |||||||||||
| Acquisition related | 865 | 220 | 1,040 | 507 | |||||||||||
| Information technology expenses | 1,856 | 1,380 | 3,448 | 2,696 | |||||||||||
| Professional fees | 690 | 480 | 1,177 | 862 | |||||||||||
| Advertising and public relations | 566 | 385 | 1,146 | 1,020 | |||||||||||
| Communications | 308 | 527 | 527 | 420 | |||||||||||
| Other | 1,809 | 1,338 | 3,232 | 3,387 | |||||||||||
| Total noninterest expense | 17,465 | 13,375 | 33,222 | 26,753 | |||||||||||
| Income before income taxes | 5,355 | 2,809 | 11,930 | 4,424 | |||||||||||
| Income taxes | 1,358 | 595 | 3,016 | 923 | |||||||||||
| Net income | $ | 3,997 | $ | 2,214 | $ | 8,914 | $ | 3,501 | |||||||
| Earnings per common share: | |||||||||||||||
| Basic | $ | 0.42 | $ | 0.23 | $ | 0.94 | $ | 0.40 | |||||||
| Diluted | 0.42 | 0.23 | 0.94 | 0.40 | |||||||||||
| Dividends declared per share | 0.10 | 0.10 | 0.21 | 0.20 | |||||||||||
| Weighted average common shares outstanding: | |||||||||||||||
| Basic | 9,498,783 | 9,498,783 | 9,498,783 | 9,498,783 | |||||||||||
| Diluted | 9,498,783 | 9,498,783 | 9,498,783 | 9,498,783 | |||||||||||
| Colony Bankcorp, Inc. | |||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| Quarterly Comparison | |||||||||||||||
| 2021 | 2020 | ||||||||||||||
| (dollars in thousands, except per share data) | Second Quarter | First Quarter | Fourth Quarter | Third Quarter | Second Quarter | ||||||||||
| Assets | $ | 1,755,518 | $ | 1,799,047 | $ | 1,763,974 | $ | 1,759,446 | $ | 1,777,568 | |||||
| Loans, net | 1,009,747 | 1,050,082 | 1,047,376 | 1,090,586 | 1,103,688 | ||||||||||
| Deposits | 1,542,214 | 1,525,884 | 1,445,027 | 1,416,401 | 1,421,758 | ||||||||||
| Total equity | 146,894 | 143,487 | 144,488 | 140,346 | 138,594 | ||||||||||
| Net income | 3,997 | 4,919 | 4,900 | 3,099 | 2,214 | ||||||||||
| Earnings per basic share | $ | 0.42 | $ | 0.52 | $ | 0.52 | $ | 0.33 | $ | 0.23 | |||||
| Key Performance Ratios: | |||||||||||||||
| Return on average assets | 0.91 | % | 1.12 | % | 1.08 | % | 0.70 | % | 0.52 | % | |||||
| Return on average total equity | 11.14 | % | 13.71 | % | 13.73 | % | 8.80 | % | 6.47 | % | |||||
| Total equity to total assets | 8.37 | % | 7.98 | % | 8.19 | % | 7.98 | % | 7.80 | % | |||||
| Tangible equity to tangible assets | 7.38 | % | 7.01 | % | 7.21 | % | 7.00 | % | 6.82 | % | |||||
| Net interest margin | 3.68 | % | 3.50 | % | 3.58 | % | 3.34 | % | 3.41 | % | |||||
| Colony Bankcorp, Inc. | |||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | |||||
| Quarterly Loan Comparison | |||||||||||||||
| 2021 | 2020 | ||||||||||||||
| (dollars in thousands) | Second Quarter | First Quarter | Fourth Quarter | Third Quarter | Second Quarter | ||||||||||
| Core | $ | 905,850 | $ | 888,800 | $ | 873,426 | $ | 871,416 | $ | 855,556 | |||||
| PPP | 58,769 | 102,633 | 101,147 | 133,756 | 133,158 | ||||||||||
| Purchased | 57,999 | 71,342 | 84,930 | 96,434 | 125,263 | ||||||||||
| Total | $ | 1,022,618 | $ | 1,062,775 | $ | 1,059,503 | $ | 1,101,606 | $ | 1,113,977 | |||||
| Colony Bankcorp, Inc. | |||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | |||||
| Quarterly Loans by Location Comparison | |||||||||||||||
| 2021 | 2020 | ||||||||||||||
| (dollars in thousands) | Second Quarter | First Quarter | Fourth Quarter | Third Quarter | Second Quarter | ||||||||||
| Atlanta | $ | 436 | $ | 492 | $ | 562 | $ | 7,025 | $ | 7,425 | |||||
| Augusta | 30,521 | 23,982 | 20,432 | 22,931 | 25,140 | ||||||||||
| Middle Georgia | 73,458 | 73,543 | 68,838 | 60,275 | 56,209 | ||||||||||
| Northwest Georgia | 2,703 | 1,698 | — | — | — | ||||||||||
| Coastal Georgia | 236,985 | 235,094 | 230,184 | 224,604 | 223,746 | ||||||||||
| South Central Georgia | 361,821 | 371,227 | 372,947 | 391,702 | 398,107 | ||||||||||
| Southwest Georgia | 95,870 | 97,575 | 104,132 | 101,247 | 108,070 | ||||||||||
| West Georgia | 148,271 | 148,457 | 154,819 | 152,159 | 154,979 | ||||||||||
| Small Business Specialty Lending | 14,923 | 7,906 | 4,537 | 9,281 | 1,903 | ||||||||||
| Paycheck Protection Program | 55,425 | 102,633 | 101,147 | 133,756 | 133,158 | ||||||||||
| Purchase Accounting | (565) | (668) | (876) | (1,262) | (1,196) | ||||||||||
| Other | 2,770 | 836 | 2,781 | 5,948 | 6,436 | ||||||||||
| Total | $ | 1,022,618 | $ | 1,062,775 | $ | 1,059,503 | $ | 1,107,666 | $ | 1,113,977 | |||||
| Colony Bankcorp, Inc. | |||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | |||||
| Quarterly PPP Fees Comparison | |||||||||||||||
| 2021 | 2020 | ||||||||||||||
| (dollars in thousands) | Second Quarter | First Quarter | Fourth Quarter | Third Quarter | Second Quarter | ||||||||||
| PPP loan fee income | $ | 1,581 | $ | 1,212 | $ | 1,324 | $ | 508 | $ | 576 | |||||
| Unearned income on PPP loans | 2,573 | 3,077 | 2,072 | 3,396 | 3,904 |
15
cban2q21presentation
1 INVESTOR PRESENTATION SECOND QUARTER - 2021
2 This presentation contains "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 Colony Bankcorp's (the "Company")’ 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;(vi) statements relating to the timing, benefits, costs, and synergies of the proposed merger with SouthCrest Financial Group, Inc. (“SouthCrest”) (the “Merger”) and the proposed acquisition of Barnes Agency (“Barnes”); and (vii) 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; the risk that the cost savings and any revenue synergies from the Merger and the acquisition of Barnes may not be realized or take longer than anticipated; disruption from the Merger and the acquisition of Barnes with customers, suppliers, employee or other business partners relationships; the occurrence of any event, change or circumstances that could give rise to the termination of the merger agreement with SouthCrest; the risk of successful integration of SouthCrest’s and Barnes’ businesses into the Company; the amount of the costs, fees, expenses and charges related to the Merger and the acquisition of Barnes; reputation risk and the reaction of each of the Company’s and SouthCrest’s customers, suppliers, employees or other business partners to the Merger; the failure of the closing conditions in the merger agreement with SouthCrest to be satisfied, or any unexpected delay in closing of the Merger; the risk that the integration of SouthCrest’s operations into the operations of the Company will be materially delayed or will be more costly or difficult than expected; the possibility that the Merger may be more expensive to complete than anticipated, including as a result of unexpected factors or events; the dilution caused by the Company’s issuance of additional shares of its common stock in the Merger; the risks associated with the Company’s pursuit of future acquisitions; and general competitive, economic, political and market conditions. 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; 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, 2020, 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. CAUTIONARY STATEMENTS
3 Statements included in this presentation include non-GAAP financial measures and should be read along with the accompanying tables, which provide a reconciliation of non-GAAP financial measure to GAAP financial measures. The non-GAAP financial measures used in this presentation include the following: operating net income, adjusted earnings per diluted share, tangible book value per common share and operating efficiency ratio. The most comparable GAAP measures are net income, diluted earnings per share, book value per common share and efficiency ratio, respectively. Operating net income and operating efficiency ratio both exclude acquisition- related expenses. Adjusted earnings per diluted share includes the adjustments to operating net income. Tangible book value excludes goodwill and other intangibles. 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. Non-GAAP financial measures should not be considered as an alternative to any measure of performance or financial condition as promulgated under GAAP, and investors should consider Colony Bankcorp, Inc. performance and financial condition as reported under GAAP and all other relevant information when assessing the performance or financial condition of Colony Bankcorp, Inc. Non-GAAP financial measures have limitations as analytical tools, and investors should not consider them in isolation or as a substitute for analysis of the results or financial condition as reported under GAAP. NON-GAAP FINANCIAL MEASURES
4 COMPANY PROFILE Locations ▪ Founded in 1975 ▪ Headquartered in Fitzgerald, Georgia ▪ $1.8 billion in assets at June 30, 2021 ▪ 29 locations in Georgia ▪ The seventh largest Georgia-based bank in the state as of March 31, 2021* ▪ Announced acquisition of SouthCrest Financial Group in April 2021. Will create Georgia’s largest community bank. ▪ Announced acquisition of The Barnes Agency in July 2021; created Colony Insurance subsidiary ▪ Strategic plan for profitable growth ▪ Track record of solid organic growth ▪ Successful execution of acquisitions *Source: S&P Global Market Intelligence Atlanta Warner Robins Statesboro Savannah Columbus Albany Fitzgerald Valdosta Athens Conyers Augusta LaGrange Macon
5 Name Position Years In Banking Years With Colony T. Heath Fountain President and Chief Executive Officer 21 2 Edward "Lee" Bagwell EVP, Chief Risk Officer and General Counsel 18 18 Leonard H. “Lenny” Bateman EVP, Chief Credit Officer 25 2 Kimberly Dockery EVP, Chief Administrative Officer 15 2 Max "Eddie" Hoyle EVP, Chief Banking Officer 42 10 Tracie Youngblood EVP, Chief Financial Officer 26 2 LEADERSHIP TEAM
6 DRIVING HIGH PERFORMANCE ◦ Achieve strong organic growth each year • Proactive business development system • Increased accountability for loan and deposit production • Created incentive plans to motivate bankers • Retail marketing plan to grow deposits • Streamlined our consumer and commercial deposits products • Larger national and regional banks with large market share in our footprint are more focused on large MSAs • Organic growth of checking and money market accounts of 7% in first half of 2021
7 DRIVING HIGH PERFORMANCE ◦ Achieve strong organic growth each year ◦ Seize on expansion opportunities • Announced acquisition of SouthCrest Financial in April 2021 for $84 million, expected to close by third quarter of 2021. • Acquisition provides entry into attractive Northern Georgia markets and increased access to highly populous suburban Atlanta markets • Establishes Colony as acquirer of choice for community banks in the Southeast • Announced acquisition of The Barnes Agency in July 2021; created Colony Insurance subsidiary, an Allstate agency • Technology and regulatory headwinds are causing industry consolidation • Industry consolidation creates an opportunity to acquire customers and talent
8 2020 2021 Note: Dollar values in thousands; Financial data as of December 31, 2020 1. 5-Year CAGR based on FY 2015 actuals to FY 2021 pro forma combined total assets 2. Pro forma FY 2021 total assets based on combined December 31, 2020 actuals; Excludes purchase accounting adjustments Source: S&P Global Market Intelligence; CBAN documents SouthCrest Financial Group, Inc. ($715.1M in assets) February 2020 Acquired East Georgia Homebuilder loan portfolio ($47M in loans) May 2019 Acquired LBC Bancshares ($207M in assets) Acquired PFB Mortgage (>$100M in loan production in 2019) October 2018 Acquired 1 Branch from Planters First ($20M in loans, $10M in deposits) 2017 – 2021 Total Assets (Dollars in thousands) 201920182017 PROVEN TRACK RECORD OF FRANCHISE ENHANCEMENT $1,232,755 $1,251,878 $1,515,313 $1,763,974 $1,763,974 $2,479,064 (2) 5-Year CAGR (1 ) : 16.1%
9 SOUTHCREST FINANCIAL OPPORTUNITY • Creates Georgia’s largest community bank and fourth largest bank in the State1 • Expands Colony into new markets • Enhanced scale, growth, profitability and performance • Significant revenue growth opportunities identified in the areas of mortgage, SBA and consumer lending • Positions Colony as the acquirer of choice for community banks looking to partner in Georgia and the surrounding region • Expected to be meaningfully accretive to Colony's fully diluted earnings per share in year one, excluding transaction costs • Solidifies management team with key executives from SouthCrest (1) Community bank defined as having less than $10.0 billion in total assets and providing a full suite of consumer and commercial products, as of December 31, 2020 Source: S&P Global Market Intelligence
10 Note: Dollar values in thousands unless otherwise noted; Financial data as of December 31, 2020 1. Community bank defined as having less than $10.0 billion in total assets as of December 31, 2020 2. Nonperforming Assets defined as the sum of nonaccrual loans, restructured loans, and other real estate owned Source: S&P Global Market Intelligence; SCSG documents Colony Banking Branches Colony LPOs SouthCrest Financial Group, Inc. Pro Forma Franchise Footprint Overview • Natural expansion into logical, contiguous markets in western Georgia and entry into adjacent markets in northern Georgia ◦ Solidifies state-wide footprint ◦ Provides entry into the attractive Atlanta and northern Georgia markets ◦ Creates a balanced footprint of rural and urban markets ◦ Diversifies CBAN’s deposit base and credit portfolio SOUTHCREST FINANCIAL OPPORTUNITY Statesboro Savannah Conyers Augusta Fayetteville Albany Tifton Soperton Eastman Rochelle Chickamauga Douglas Fitzgerald Broxton Cordele AshburnLeesburg Sylvester Rockmart Athens Moultrie Valdosta Quitman Atlanta Cedartown Canton Cumming Luthersville MaconLaGrange Centerville Thomaston Columbus WarnerRobins
11 DRIVING HIGH PERFORMANCE ◦ Achieve strong organic growth each year ◦ Seize on expansion opportunities ◦ Increase operating efficiency • Realignment plan with focus on operating expense savings of $1 million annually • Optimize our balance sheet for improved earnings • Improve processes for efficiency and better controls • Run a more efficiently staffed branch network • Utilize technology to lower operating costs through investment in our popular digital banking channels • Align our staffing and procedures to adhere to industry best practices for service and efficiency
12 DRIVING HIGH PERFORMANCE ◦ Increase non-interest income • Acquiring The Barnes Agency in August 2021 - forming Colony Insurance to offer consumer insurance solutions • Growing our deposit account customer base increases service charge and interchange revenue • Acquisition of PFB Mortgage added to our mortgage team in 2019 • Started a Small Business Specialty Lending division to offer SBA, USDA and other government guaranteed loan products • Look to add wealth management and other lines of business ◦ Achieve strong organic growth each year ◦ Seize on expansion opportunities ◦ Increase operating efficiency
13 COLONY INSURANCE • Agreed to acquire The Barnes Agency, an Allstate appointed consumer property and casualty insurance agency in Macon, GA • Formed a new subsidiary, Colony Insurance, which will offer a suite of consumer insurance solutions • Named Jason Barnes President of Colony Insurance • Logical extension to existing range of financial products and services • Diversifies revenue stream and increases non-interest income • Opportunities to grow insurance offerings and enhance profitability of the branch network through cross-selling of products and services
14 ◦ In May 2019, Colony Bank acquired PFB Mortgage, which had more than $100 million in annual mortgage production in 2019 • Added to our team by adding originators in Albany, Athens, Macon, Savannah, Statesboro and Warner Robins • Added seasoned mortgage executives through acquisition ◦ Increased volume in Mortgage division production: • $101.8 million in production in the first quarter of 2021 • $151.4 million in production in the second quarter of 2021 ◦ Added experienced origination teams in Augusta, LaGrange, and Savannah, focused on expanding business MORTGAGE DIVISION
15 SMALL BUSINESS SPECIALTY LENDING GROUP ◦ In July 2019, opened a metro Atlanta office for Small Business Specialty Lending (SBSL) Group focused on Small Business Administration (SBA) lending and other government guaranteed loans ◦ 11 team members added, including three business development officers, led by two veteran bankers, Darren Davis, President, and Stephen T. Kruto, Director of Operations ◦ Originated loans under SBA Paycheck Protection Program (PPP) related to the Economic Aid Act, resulting in 950 loans totaling over $52.4 million in 2021 ◦ Closed $15.1 million in loans in the second quarter and $6.0 million remains in the pipeline
16 DRIVING HIGH PERFORMANCE ◦ Increase non-interest income ◦ Create a culture of high performance • Instill behaviors and habits that lead to great results • Coaching team members to improve performance • Increase incentive and performance based compensation • Pursue open communication and honest feedback ◦ Achieve strong organic growth each year ◦ Seize on expansion opportunities ◦ Improve operating efficiency
17 ◦ Since our founding in 1975, our mission is to provide an alternative to traditional banking that our customers deserve ◦ Focus on relationships that are beneficial to the customer and the Bank – one-sided relationships and transactions do not create value ◦ Strive to be trusted advisors and give consultative advice ◦ Nimble and responsive to customer needs ◦ Team members are passionate about delivering solutions VALUE PROPOSITION TO OUR CUSTOMERS
18 2016 2017 2018 2019 2020 Diluted earnings per share $ 0.84 $ 0.87 $ 1.4 $ 1.12 $ 1.24 Dividends per share $ — $ 0.1 $ 0.2 $ 0.3 $ 0.4 Return on average assets 0.62 % 0.63 % 0.99 % 0.72 % 0.7 % Return on average total equity 7.17 % 8.28 % 13.32 % 8.72 % 8.56 % Net interest margin 3.51 % 3.46 % 3.56 % 3.61 % 3.5 % Efficiency ratio 71.74 % 69.19 % 70.05 % 77.93 % 73.34 % ANNUAL FINANCIAL HIGHLIGHTS
19 2Q2020 3Q2020 4Q2020 1Q2021 2Q2021 Diluted earnings per share $ 0.23 $ 0.33 $ 0.52 $ 0.52 $ 0.42 Adjusted earnings per diluted share (1) $ 0.25 $ 0.39 $ 0.44 $ 0.53 $ 0.49 Dividends per share $ 0.10 $ 0.10 $ 0.10 $ 0.10 $ 0.10 Return on average assets 0.52% 0.70% 1.08% 1.12% 0.91% Return on average total equity 6.47% 8.80% 13.73% 13.71% 11.14% Net interest margin 3.41% 3.34% 3.58% 3.50% 3.68% Efficiency ratio 72.75% 76.22% 68.93% 69.04% 76.53% FINANCIAL HIGHLIGHTS (1) See non-GAAP reconciliation table on slide 30 Trailing 5 quarters
20 2016 2017 2018 2019 2020 Total assets $ 1,210.4 $ 1,232.8 $ 1,251.9 $ 1,515.3 $ 1,763.9 Loans $ 754.3 $ 765.3 $ 782.4 $ 971.2 $ 1,062.8 Unearned income $ (0.4) $ (0.5) $ (0.5) $ (0.6) $ (2.4) Unamortized discount on acquired loans $ — $ — $ (0.3) $ (1.7) $ (0.9) Allowance for loan losses $ (8.9) $ (7.5) $ (7.3) $ (6.9) $ (12.1) Total loans, net $ 745.0 $ 757.3 $ 774.3 $ 962.0 $ 1,047.4 Total deposits $ 1,044.4 $ 1,068.0 $ 1,085.1 $ 1,294.2 $ 1,445.1 NPA/Total assets 1.55 % 0.95 % 0.90 % 0.73 % 0.58 % ANNUAL BALANCE SHEET FINANCIAL HIGHLIGHTS (Dollars in millions)
21 2Q2020 3Q2020 4Q2020 1Q2021 2Q2021 Total assets $ 1,777.6 $ 1,759.4 $ 1,763.9 $ 1,799.0 $ 1,763.9 Loans $ 1,119.6 $ 1,112.6 $ 1,062.8 $ 1,064.2 $ 1,025.7 Unearned income $ (4.4) $ (3.8) $ (2.4) $ (3.4) $ (2.5) Unamortized discount on acquired loans $ (1.2) $ (1.2) $ (0.9) $ (0.7) $ (0.6) Allowance for loan losses $ (10.3) $ (11.0) $ (12.1) $ (12.7) $ (12.9) Total loans, net $ 1,103.7 $ 1,096.6 $ 1,047.4 $ 1,047.4 $ 1,009.7 Total deposits $ 1,421.8 $ 1,416.4 $ 1,445.1 $ 1,542.2 $ 1,445.1 NPA/Total assets 0.75% 0.68% 0.58% 0.62% 0.54% BALANCE SHEET FINANCIAL HIGHLIGHTS (Dollars in millions) Trailing 5 quarters
22 The current indicated annual rate is $0.41 per share, equating to a yield of 2.3%.(2) SHAREHOLDER FOCUSED DIVIDEND POLICY (1) The Board of Directors declared a dividend to be paid on its common stock on August 17, 2021, to shareholders of record as of the close of business on August 3, 2021. (2) Yield is based on closing stock price on July 21, 2021 of $17.73
23 CAPITAL RATIOS 10.2% 9.0% 9.6% 9.2% 8.5% 15.0% 12.5% 14.3% 12.4% 13.4% 15.9% 13.2% 15.4% 13.3% 14.6% 12.2% 10.3% 10.3% 10.3% 11.3% Tier One Leverage Ratio Tier One Ratio Total Risk-based Capital Ratio Common Equity Tier One Capital Ratio 2018 2019 2020 6/30/2020 6/30/2021
24 SOLID CORE DEPOSIT FRANCHISE As of June 30, 2021 Total Deposits: $1.54 billion MRQ Cost of Deposits: 0.22% Interest Bearing Demand, 33% Noninterest bearing demand, 26% Time deposits, 16% Savings and Money- markets, 25%
25 LOAN PORTFOLIO BREAKDOWN As of June 30, 2021 $1,022.7 million Real Estate 81% Consumer and Other 1.9% Commercial 15% Agriculture 2.3% $830.6 million Commercial real estate 55% Residential real estate 22% Construction 15% Farmland 8%
26 LOAN PORTFOLIO(1) (Dollars in millions) Organic Loan Growth (Excluding PPP Loans) (1) Represents gross loan balances. Excludes PPP loans totaling $58.8 million, $102.6 million, $101.1 million $133.8 million, $133.2 million at 6/30/2021, 3/31/2021, 12/31/2020,9/30/2020 and 6/30/2020, respectively $980.9 $967.8 $958.3 $960.1 $964.0 Organic Total Loans 06/30/20 09/30/20 12/31/2020 03/31/21 06/30/21 $— $250.0 $500.0 $750.0 $1,000.0 $1,250.0
27 ◦ SouthCrest acquisition to accelerate growth ◦ Well positioned for continued organic growth ◦ Improving earnings outlook ◦ Shareholder friendly dividend policy ◦ Opportunities created by industry consolidation ◦ Seasoned leadership with a proven track record INVESTMENT CONSIDERATIONS
28 RECONCILIATION OF NON-GAAP MEASURES (Dollars in thousands, except per share data) 2021 2020 (dollars in thousands, except per share data) Second Quarter First Quarter Fourth Quarter Third Quarter Second Quarter Operating net income reconciliation Net income (GAAP) $ 3,997 $ 4,919 $ 4,900 $ 3,098 $ 2,214 Acquisition-related expenses 865 176 148 207 220 Thomaston building write down — — — 582 — Gain on sale of Thomaston branch — — (1,026) — — Income tax expense (benefit) (225) (46) 184 (166) (46) Operating net income $ 4,637 $ 5,049 $ 4,206 $ 3,721 $ 2,388 Weighted average diluted shares 9,498,783 9,498,783 9,498,783 9,498,783 9,498,783 Adjusted earnings per diluted share $ 0.49 $ 0.53 $ 0.44 $ 0.39 $ 0.25 Tangible book value per common share reconciliation Book value per common share (GAAP) $ 15.46 $ 15.11 $ 15.21 $ 14.78 $ 14.59 Effect of goodwill and other intangibles (1.97) (1.97) (1.95) (1.96) (1.96) Tangible book value per common share $ 13.50 $ 13.14 $ 13.26 $ 12.82 $ 12.63 Operating efficiency ratio calculation Efficiency ratio (GAAP) 76.53 % 69.04 % 68.93 % 76.22 % 72.75 % Acquisition-related expenses (3.44) (0.46) (0.64) (0.97) (1.20) Gain on sale of Thomaston branch — % — % 3.19 % — % — % Thomaston building write down — % — % — % (2.72) % — % Operating efficiency ratio 73.10 % 68.58 % 71.49 % 72.53 % 71.55 %
29 NASDAQ: CBAN