8-K - CCBG - Equibles

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON,

DC 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 27, 2021

CAPITAL CITY BANK GROUP, INC.

(Exact name of registrant as specified in its charter)

Florida

0-13358

59-2273542

(State of Incorporation)

(Commission File Number)

(IRS Employer Identification No.)

217 North Monroe Street,

Tallahassee

Florida

32301

(Address of principal executive offices

(Zip Code)

Registrant's telephone number, including

area code: (

850

)

402-7821

(Former Name or Former Address, if Changed Since

Last Report)

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 (see General Instruction

A.2. below):

☐

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 $0.01

CCBG

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 pursuant to Section 13(a) of The Exchange Act.

☐

CAPITAL CITY BANK

GROUP,

INC.

FORM 8

-K

CURRENT REPORT

Item 2.02.

Results of Operations and Financial Condition.

On July 27, 2021, Capital City Bank Group, Inc. (“CCBG”) issued

an earnings press release reporting CCBG’s

financial

results for the three and six month period ended

June 30, 2021.

A copy of the press release is attached as Exhibit 99.1 hereto

and

incorporated herein by reference.

The information furnished under Item 2.02 of this Current

Report, including the Exhibit attached hereto, shall not

be deemed

“filed” for purposes of Section 18 of the Securities Exchange

Act of 1934, nor shall it be deemed incorporated by reference in

any

filing under the Securities Act of 1933, except as shall be

expressly set forth by specific reference in such filing.

Item 9.01.

Financial Statements and Exhibits.

(d)

Exhibits

Item No.

Description of Exhibit

99.1

Press release, dated July 27, 2021.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act

of 1934, the Registrant has duly caused this report to

be signed

on its behalf by the undersigned hereunto duly authorized.

CAPITAL CITY BANK

GROUP,

INC.

Date:

July 27, 2021

By:

/s/ J.Kimbrough Davis

J. Kimbrough Davis,

Executive Vice President

and Chief Financial Officer

EXHIBIT INDEX

Exhibit

Number

Description

99.1

Press release, dated July 27, 2021

exhibit991

Capital City Bank Group, Inc.

Reports Second Quarter 2021 Results

TALLAHASSEE,

Fla. (July 27, 2021) – Capital City Bank Group,

Inc. (NASDAQ: CCBG) today reported net income of $7.4

million, or $0.44 per diluted share, for the second quarter

of 2021 compared to net income of $9.5 million, or $0.56

per diluted share,

for the first quarter of 2021, and $9.1 million, or $0.55

per diluted share,

for the second quarter of 2020.

Net income for the second

quarter of 2021 included a partial pension settlement charge

of $2.0 million (pre-tax),

or $0.10 per diluted share (after tax).

For the first six months of 2021, net income totaled

$16.9 million, or $1.00 per diluted share, compared to net income

of $13.4

million, or $0.80 per diluted share, for the same period

of 2020.

Our return on average assets (“ROA”) was 0.75% and our

return on average equity (“ROE”) was 9.05% for the second

quarter of

2021.

These metrics were 1.01% and 11.81%

for the first quarter of 2021, respectively,

and 1.10% and 11.03% for the second

quarter of 2020, respectively.

For the first six months of 2021, our ROA was 0.88% and

our ROE was 10.42% compared to 0.85%

and 8.12%, respectively,

for the same period of 2020.

QUARTER HIGHLIGHTS

●

Net interest income grew

6% sequentially

driven by strong loan growth

and higher SBA PPP fees

●

Period-end loan balances (net of SBA PPP balances) grew

by $74 million, or 4.0% sequentially

Remaining SBA PPP balances and deferred

fees totaled $80 million and $3.5 million, respectively,

at period-end

●

Strong credit

quality metrics and a net loan loss recovery drove

a negative credit loss provision

of $0.6 million

●

Average deposit balances

grew $148 million, or 4.6% sequentially and

reflected additional stimulus inflows as well as strong

core deposit growth

●

Noninterest expense increased

$1.6 million and included a partial pension settlement charge

of $2.0 million – controllable

expenses at CCB continued to be well managed

●

Capital City Home Loans (“CCHL”) contributed $0.0

per share

“Challenges remain, but Capital City produced solid results

for both the second quarter and first half of 2021,” said

William G.

Smith, Jr., Chairman,

President and CEO of Capital City Bank Group.

“Excluding PPP loans, our loan portfolio grew $74.3 million

or 3.8%, for the quarter with commercial mortgages and

auto finance contributing a majority of the net growth.

Continued

improvement in the economy and favorable credit quality

resulted in a negative credit loss provision of $570,000.

Quarter over

quarter, our fee based businesses performed

well.

Wealth management

revenues increased 6.0%,

and I am pleased to welcome

Capital City Strategic Wealth

(“CCSW” – formerly Strategic Wealth

Group) to our team.

CCSW offers financial planning services

specializing in life insurance solutions and we are excited

about the prospects it brings to our wealth management business.

Debit

and credit card fees were up 10% as consumer spending

gains momentum.

Although mortgage revenues were down for the quarter,

CCHL continues to perform well above its historical norms.

After adjusting for the pension settlement expense of $2.0

million,

our

total expenses were down quarter over quarter and continue

to be well managed.

Our management team focuses on those aspects of

our business we can do something about and strives to

implement strategies that are sustainable and produce long-term

value for our

shareowners.

I am optimistic about our future and appreciate your support.”

COVID-19 Update

●

We continue

to closely monitor conditions including the rising case count

in some of our communities.

●

We have established

a tentative return to work date for all associates, but we

will adjust as necessary depending on changing

conditions.

●

All of our banking offices have returned to

normal banking hours and lobby services.

●

We are adhering

to national guidelines and local safety ordinances to protect

both clients and associates.

●

We continue

to support clients with the Small Business Administration Payment

Protection Program (“SBA PPP”) by actively

assisting with the Round 1 and 2 forgiveness process.

Discussion of Operating

Results

Net Interest Income/Net Interest

Margin

Tax-equivalent

net interest income for the second quarter of 2021 totaled $26.1

million compared to $24.6 million for the first

quarter of 2021 and $25.6 million for the second quarter

of 2020.

Compared to the first quarter of 2021, the increase reflected higher

SBA PPP loan fees of $0.7 million, higher loan interest of

$0.5 million driven by loan growth, and higher investment

securities

income of $0.2 million which reflected deployment

of excess overnight funds into the investment portfolio.

Compared to the second

quarter of 2020, the increase was driven by higher SBA PPP

loan fees of $1.3 million partially offset by

lower interest earned on

investment securities and variable/adjustable rate loans.

For the first six months of 2021, tax-equivalent net interest

income totaled

$50.7 million compared to $51.4 million for the same period

of 2020.

The decrease generally reflected lower rates earned on

investment securities and variable/adjustable rate loans

partially offset by higher SBA PPP loan fees and lower

interest expense.

Our net interest margin for the second quarter

of 2021 was 2.89%, an increase of three basis points over

the first quarter of 2021 and

a decrease of 52 basis points from the second quarter

of 2020.

Compared to the first quarter of 2021, the increase was driven

higher SBA PPP loan fees.

Compared to the second quarter of 2020, the decrease was primarily

attributable to downward re-pricing

of earning assets and significant growth in overnight funds (driven

by deposit inflows) which negatively impacts our margin

percentage.

For the first six months of 2021, the net interest margin

decreased 72 basis points to 2.87% generally reflective of

downward re-pricing of our earning assets (variable/adjustable rate

loans and securities portfolio) partially offset by a

lower cost of

funds and higher SBA PPP loan fees.

Our net interest margin for the second quarter of

2021, excluding the impact of overnight

funds in excess of $200 million, was 3.46%.

Provision for Credit Loss

We recorded

a negative provision for credit losses of $0.6 million for the second

quarter of 2021 compared to a negative provision

of $1.0 million for the first quarter of 2021 and provision

expense of $2.0 million for the second quarter of 2020.

For the first six

months of 2021, we recorded a negative provision of

$1.6 million compared to provision expense of $7.0 million

for the same

period of 2020.

The negative provision for the first half of 2021 generally

reflected improving economic conditions and strong net

loan recoveries totaling $0.9 million.

We discuss the allowance

for credit losses further below.

Noninterest Income and Noninterest

Expense

Noninterest income for the second quarter of 2021 totaled

$26.5 million compared to $29.8 million for the first quarter of 2021

and

$30.2 million for the second quarter of 2020.

The aforementioned declines were primarily due to

lower mortgage banking revenues

at CCHL, partially offset by improvements in

wealth management and bank card fees.

The decline in mortgage banking revenues

reflected lower production volume (primarily re-finance

activity) and a lower gain on sale margin.

For the first six months of 2021,

noninterest income totaled $56.3 million compared to

$45.7 million for the same period of 2020 with the increase

driven by the

addition of CCHL mortgage banking revenues late in

the first quarter of 2020,

and higher bank card and wealth management fees

which grew $1.4 million and $1.2 million, respectively

Additional detail on CCHL’s

operations and key performance metrics is

provided on page 11.

Noninterest expense for the second quarter of 2021 totaled

$42.1 million compared to $40.5 million for the first quarter

of 2021 and

$37.3 million for the second quarter of 2020.

For the first six months of 2021, noninterest expense totaled

$82.6 million compared

to $68.3 million for the same period of 2020.

The $1.6 million increase over the first quarter of 2021

reflected a $2.0 million partial

pension settlement charge that was partially offset

by lower commission expense at CCHL and lower legal fees and

other real estate

owned (“OREO”) expense at CCB.

The partial pension settlement charge

was attributable to a higher level of lump sum pay-outs, a

trend that we expect will continue for the remainder of

the year.

Compared to the prior year periods, the increase was primarily

attributable to the partial pension settlement charge

of $2.0 million, lower realized loan cost (credit offset

to salary expense), higher

pension plan expense (driven by a lower discount rate

for plan liabilities), and performance based compensation.

Additionally, the

increase for the first half of 2021 reflects the inclusion

of CCHL expenses for a full six month period versus only

four months in

2020.

Income Taxes

We realized income

tax expense of $2.1 million (effective rate of 19

%) for the second quarter of 2021 compared to $2.8 million

(effective rate of 19%) for the first quarter

of 2021 and $2.9 million (effective rate of 18%) for

the second quarter of 2020.

For the

first six months of 2021, we realized income tax

expense of $4.8

million (effective rate of 19%) compared to $4.2 million (effective

rate of 20%) for the same period of 2020.

Absent discrete items, we expect our annual effective tax

rate to approximate 18%-19%.

Discussion of Financial Condition

Earning Assets

Average earning

assets totaled $3.624 billion for the second quarter of 2021, an

increase of $126.0 million, or 3.6%, over the first

quarter of 2021, and an increase of $286.5 million,

or 8.6%, over the fourth quarter of 2020.

The increase over both prior periods

was primarily driven by higher deposit balances, which funded

growth in both overnight funds sold and the investment

portfolio.

Deposit balances increased as a result of strong core deposit

growth, in addition to funding retained at the bank from

SBA PPP

loans, and various other stimulus programs.

We maintained

an average net overnight funds (deposits with banks plus FED funds

sold less FED funds purchased) sold position of

$818.6 million in the second quarter of 2021 compared to

an average net overnight funds sold position of $814.6 million

in the first

quarter of 2021 and $705.1 million in the fourth quarter

of 2020.

The increase compared to both prior periods was driven by

strong

core deposit growth, in addition to pandemic related stimulus

programs (see below –

Funding

Average loans

held for investment (HFI) decreased $7.6 million, or 0.4%, from

the first quarter of 2021 and increased $43.3 million,

or 2.2%, over the fourth quarter of 2020.

Excluding SBA PPP loans, average core loans grew $54.4

million and $90.4 million over

both respective periods and period end loans grew $74.3

million and $97.7 million over both respective periods.

Growth in period

end loans was driven primarily in the commercial

mortgage, indirect, and construction categories.

At June 30, 2021, SBA PPP loan

balances totaled $79.9 million and remaining deferred SBA PPP net

loan fees totaled $3.5 million.

SBA PPP loan forgiveness

applications are expected to remain strong for the remainder

of 2021.

Allowance for Credit Losses

At June 30, 2021, the allowance for credit losses for

HFI loans totaled $22.2 million compared to $22.0 million

at March 31, 2021

and $23.8 million at December 31, 2020.

Activity within the allowance is provided on Page 9.

At June 30, 2021, the allowance

represented 1.10%

of HFI loans and provided coverage of 434%

of nonperforming loans compared to 1.07%

and 411%,

respectively, at March

31, 2021, and 1.19% and 406%, respectively,

at December 31, 2020.

At June 30, 2021, excluding SBA PPP

loans (100% government guaranteed),

the allowance represented 1.15% of HFI loans compared to

1.30% at December 31, 2020.

Credit Quality

Nonperforming assets (nonaccrual loans and OREO) totaled

$6.3 million at June 30, 2021 compared to $5.5 million at

March 31,

2021 and $6.7 million at December 31, 2020.

Nonaccrual loans totaled $5.1 million at June 30, 2021, a

$0.3 million decrease from

March 31, 2021 and a $0.8 million decrease from

December 31, 2020.

The balance of OREO totaled $1.2 million at June 30, 2021,

a $1.0 million increase over March 31, 2021 and $0.4

million increase over December 31, 2020.

Funding (Deposits/Debt)

Average total

deposits were $3.387 billion for the second quarter of 2021, an

increase of $147.8 million, or 4.6%, over the first

quarter of 2021 and $321.2 million, or 10.5%, over

the fourth quarter of 2020.

The strongest growth over both comparable periods

occurred in our noninterest bearing deposits and savings

account balances. Average

public deposits in the second quarter 2021

increased compared to the fourth quarter 2020, but declined

compared to the first quarter 2021 due to the seasonality of

these

deposits. Over the past 12 months, multiple government

stimulus programs have been implemented, including those under

the

CARES Act and the American Rescue Plan Act, which are

responsible for a large part of the growth in average

deposits. Given

these increases, the potential exists for our deposit levels to

be volatile for the remainder of

2021 due to the uncertain timing of the

outflows of the stimulus related balances and the economic

recovery.

It is anticipated that current liquidity levels will remain robust

due to our strong overnight funds sold position.

The Bank continues to strategically consider ways to safely

deploy a portion of this

liquidity.

Average short

-term borrowings decreased $15.9 million over the first quarter of

2021 and declined $44.1 million over the fourth

quarter of 2020,

both of which reflected a seasonal fluctuation in warehouse line

borrowing needs to support CCHL’s

loans held for

sale.

Capital

Shareowners’ equity was $335.9 million at June 30,

2021 compared to $324.4 million at March 31, 2021 and

$320.8 million at

December 31, 2020.

For the first six months of 2021, shareowners’ equity was positively

impacted by net income of $16.9 million,

a $0.9 million increase in fair value of the interest rate

swap related to subordinated debt,

net adjustments totaling $1.0 million

related to transactions under our stock compensation plans,

stock compensation accretion of $0.4 million, and reclassification

$1.2 million from temporary equity to decrease the redemption

value of the non-controlling interest in CCHL.

In addition, $1.6

million was reclassified from accumulated other comprehensive

loss to pension expense in conjunction with the partial

pension

settlement charge reflected in earnings, therefore,

the charge had no net effect on equity

Shareowners’ equity was reduced by

common stock dividends

of $5.1 million ($0.30 per share) and a $1.8 million decrease in

the unrealized gain on investment

securities.

At June 30, 2021, our total risk-based capital ratio was

16.48% compared to 17.20% at March 31, 2021 and 17.30% at

December

31, 2020.

Our common equity tier 1 capital ratio was 13.14%, 13.63%, and 13.71%,

respectively, on these dates.

Our leverage ratio

was 8.84%, 8.97%, and 9.33%, respectively,

on these dates.

All of our regulatory capital ratios exceeded the

threshold to be

designated as “well-capitalized” under the Basel III

capital standards.

Further, our tangible common equity ratio

was 6.19% at June

30, 2021 compared to 6.13% and 6.25% at March

31, 2021 and December 31, 2020,

respectively.

About Capital City Bank Group, Inc.

Capital City Bank Group, Inc. (NASDAQ: CCBG) is one

of the largest publicly traded financial holding companies

headquartered

in Florida and has approximately $4.0 billion in assets.

We provide

a full range of banking services, including traditional deposit

and credit services, mortgage banking, asset management,

trust, merchant services, bankcards, securities brokerage services and

life

insurance.

Our bank subsidiary, Capital City

Bank (“CCB”),

was founded in 1895 and now has 57 banking offices

and 86

ATMs/ITMs

in Florida, Georgia and Alabama.

For more information about Capital City Bank Group,

Inc., visit

www.ccbg.com

FORWARD

-LOOKING STATEMENTS

Forward-looking statements in this Press Release are based on

current plans and expectations that are subject to uncertainties and

risks, which could cause our future results to differ

materially.

The following factors, among others, could cause our actual results to

differ: the magnitude and duration of the COVID-19

pandemic and its impact on the global economy and financial

market conditions

and our business, results of operations and financial condition,

including the impact of our participation in government programs

related to COVID-19; the accuracy of the our financial

statement estimates and assumptions; legislative or regulatory

changes;

fluctuations in inflation, interest rates, or monetary policies;

the effects of security breaches and computer

viruses that may affect our

computer systems or fraud related to debit card products; changes

in consumer spending and savings habits; our growth and

profitability; the strength of the U.S. economy and the

local economies where we conduct operations; the effects

of a non-diversified

loan portfolio, including the risks of geographic and

industry concentrations; natural disasters, widespread health

emergencies,

military conflict, terrorism or other geopolitical events; changes

in the stock market and other capital and real estate markets;

customer acceptance of third-party products and services;

increased competition and its effect on pricing; negative

publicity and the

impact on our reputation; technological changes, especially

changes that allow out of market competitors to compete

in our

markets; changes in accounting; and our ability to manage

the risks involved in the foregoing.

Additional factors can be found in our

Annual Report on Form 10-K for the fiscal year ended

December 31, 2020,

and our other filings with the SEC, which are available

at the SEC’s internet site (http://www.sec.gov).

Forward-looking statements in this Press Release speak only as of

the date of the

Press Release, and we assume no obligation to update

forward-looking statements or the reasons why actual results

could differ.

USE OF NON-GAAP FINANCIAL MEASURES

We present a

tangible common equity ratio and a tangible book value per

diluted share that removes the effect of goodwill and other

intangibles resulting from merger and acquisition

activity.

We believe these

measures are useful to investors because it allows

investors to more easily compare our capital adequacy

to other companies in the industry.

The GAAP to non-GAAP reconciliations are provided below.

(Dollars in Thousands, except per share data)

Jun 30, 2021

Mar 31, 2021

Dec 31, 2020

Sep 30, 2020

Jun 30, 2020

Shareowners' Equity (GAAP)

335,880

324,426

320,837

339,425

335,057

Less: Goodwill and Other Intangibles (GAAP)

93,333

89,095

Tangible Shareowners' Equity (non-GAAP)

242,547

235,331

231,742

250,330

245,962

Total Assets (GAAP)

4,011,459

3,929,884

3,798,071

3,587,041

3,499,524

Less: Goodwill and Other Intangibles (GAAP)

93,333

89,095

Tangible Assets (non-GAAP)

3,918,126

3,840,789

3,708,976

3,497,946

3,410,429

Tangible Common Equity Ratio (non-GAAP)

A/B

6.19%

6.13%

6.25%

7.16%

7.21%

Actual Diluted Shares Outstanding (GAAP)

16,901,375

16,875,719

16,844,997

16,800,563

16,821,743

Tangible Book Value

per Diluted Share (non-GAAP)

A/C

14.35

13.94

13.76

14.90

14.62

CAPITAL CITY BANK

GROUP,

INC.

EARNINGS HIGHLIGHTS

Unaudited

Three Months Ended

Six Months Ended

(Dollars in thousands, except per share data)

Jun 30, 2021

Mar 31, 2021

Jun 30, 2020

Jun 30, 2021

Jun 30, 2020

EARNINGS

Net Income Attributable to Common Shareowners

7,427

9,506

9,146

16,933

13,433

Diluted Net Income Per Share

0.44

0.56

0.55

1.00

0.80

PERFORMANCE

Return on Average Assets

0.75

1.01

1.10

0.88

0.85

Return on Average Equity

9.05

11.81

11.03

10.42

8.12

Net Interest Margin

2.89

2.85

3.41

2.87

3.59

Noninterest Income as % of Operating Revenue

50.47

54.90

54.26

52.73

47.13

Efficiency Ratio

80.18

74.36

66.90

77.22

70.30

CAPITAL ADEQUACY

Tier 1 Capital

15.44

16.08

16.59

15.44

16.59

Total Capital

16.48

17.20

17.60

16.48

17.60

Leverage

8.84

8.97

10.12

8.84

10.12

Common Equity Tier 1

13.14

13.63

14.01

13.14

14.01

Tangible Common Equity

(1)

6.19

6.13

7.21

6.19

7.21

Equity to Assets

8.37

8.26

9.57

8.37

9.57

ASSET QUALITY

Allowance as % of Non-Performing Loans

433.93

410.78

322.37

433.93

322.37

Allowance as a % of Loans HFI

1.10

1.07

1.11

1.10

1.11

Net Charge-Offs as % of Average Loans

HFI

(0.07)

(0.10)

0.05

(0.08)

0.14

Nonperforming Assets as % of Loans HFI and OREO

0.31

0.27

0.40

0.31

0.40

Nonperforming Assets as % of Total Assets

0.16

0.14

0.23

0.16

0.23

STOCK PERFORMANCE

High

27.39

28.98

23.99

28.98

30.62

Low

24.55

21.42

16.16

21.42

15.61

25.79

26.02

20.95

25.79

20.95

Average Daily Trading

Volume

28,958

30,303

49,569

29,620

45,089

(1)

Tangible common equity ratio is a non-GAAP financial measure.

For additional information, including a reconciliation to GAAP, refer to

Page 5.

CAPITAL CITY BANK GROUP, INC.

CONSOLIDATED STATEMENT

OF FINANCIAL CONDITION

Unaudited

2021

2020

(Dollars in thousands)

Second Quarter

First Quarter

Fourth Quarter

Third Quarter

Second Quarter

ASSETS

Cash and Due From Banks

78,894

73,973

67,919

76,509

75,155

Funds Sold and Interest Bearing Deposits

766,920

851,910

860,630

626,104

513,273

Total Cash and Cash Equivalents

845,814

925,883

928,549

702,613

588,428

Investment Securities Available for Sale

480,890

406,245

324,870

328,253

341,180

Investment Securities Held to Maturity

325,559

199,109

169,939

202,593

232,178

Total Investment Securities

806,449

605,354

494,809

530,846

573,358

Loans Held for Sale ("HFS")

80,821

82,081

114,039

116,561

76,610

Loans Held for Investment ("HFI"):

Commercial, Financial, & Agricultural

292,953

413,819

393,930

402,997

421,270

Real Estate - Construction

149,884

138,104

135,831

125,804

117,794

Real Estate - Commercial

707,599

669,158

648,393

656,064

662,434

Real Estate - Residential

362,018

358,849

342,664

335,713

353,831

Real Estate - Home Equity

190,078

202,099

205,479

197,363

194,479

Consumer

298,464

267,666

269,520

268,393

266,417

Other Loans

6,439

7,082

9,879

10,488

4,883

Overdrafts

1,227

950

730

1,339

1,069

Total Loans Held for Investment

2,008,662

2,057,727

2,006,426

1,998,161

2,022,177

Allowance for Credit Losses

(22,175)

(22,026)

(23,816)

(23,137)

(22,457)

Loans Held for Investment, Net

1,986,487

2,035,701

1,982,610

1,975,024

1,999,720

Premises and Equipment, Net

85,745

86,370

86,791

87,192

87,972

Goodwill and Other Intangibles

93,333

89,095

Other Real Estate Owned

1,192

110

808

1,227

1,059

Other Assets

111,618

105,290

101,370

84,483

83,282

Total Other Assets

291,888

280,865

278,064

261,997

261,408

Total Assets

4,011,459

3,929,884

3,798,071

3,587,041

3,499,524

LIABILITIES

Deposits:

Noninterest Bearing Deposits

1,552,864

1,473,891

1,328,809

1,378,314

1,377,033

NOW Accounts

970,705

993,571

1,046,408

827,506

808,244

Money Market Accounts

280,805

269,041

266,649

247,823

240,754

Regular Savings Accounts

539,477

518,373

474,100

451,944

423,924

Certificates of Deposit

103,070

103,232

101,594

103,859

105,041

Total Deposits

3,446,921

3,358,108

3,217,560

3,009,446

2,954,996

Short-Term Borrowings

47,200

55,687

79,654

90,936

63,958

Subordinated Notes Payable

52,887

Other Long-Term Borrowings

1,720

1,829

3,057

5,268

5,583

Other Liabilities

105,534

109,487

102,076

71,880

75,702

Total Liabilities

3,654,262

3,577,998

3,455,234

3,230,417

3,153,126

Temporary Equity

21,317

27,460

22,000

17,199

11,341

SHAREOWNERS' EQUITY

Common Stock

169

168

Additional Paid-In Capital

33,560

32,804

32,283

31,425

31,575

Retained Earnings

345,574

335,324

332,528

333,545

328,570

Accumulated Other Comprehensive Loss, Net of Tax

(43,423)

(43,871)

(44,142)

(25,713)

(25,256)

Total Shareowners' Equity

335,880

324,426

320,837

339,425

335,057

Total Liabilities, Temporary Equity and Shareowners' Equity

4,011,459

3,929,884

3,798,071

3,587,041

3,499,524

OTHER BALANCE SHEET DATA

Earning Assets

3,662,852

3,597,071

3,475,904

3,271,672

3,185,418

Interest Bearing Liabilities

1,995,864

1,994,620

2,024,349

1,780,223

1,700,391

Book Value Per Diluted Share

19.87

19.22

19.05

20.20

19.92

Tangible Book Value

Per Diluted Share

(1)

14.35

13.94

13.76

14.90

14.62

Actual Basic Shares Outstanding

16,874

16,852

16,791

16,761

16,780

Actual Diluted Shares Outstanding

16,901

16,876

16,845

16,801

16,822

(1)

Tangible book value per diluted share is a non-GAAP financial measure.

For additional information, including a reconciliation to GAAP, refer to Page 5.

CAPITAL CITY BANK

GROUP,

INC.

CONSOLIDATED STATEMENT

OF OPERATIONS

Unaudited

2021

2020

June 30,

(Dollars in thousands, except per share data)

Second

Quarter

First

Quarter

Fourth

Quarter

Third

Quarter

Second

Quarter

2021

2020

INTEREST INCOME

Interest and Fees on Loans

24,582

23,350

23,878

23,594

23,687

47,932

47,280

Investment Securities

2,054

1,883

2,096

2,426

2,737

3,937

5,752

Funds Sold

200

213

180

146

413

845

Total Interest Income

26,836

25,446

26,154

26,166

26,512

52,282

53,877

INTEREST EXPENSE

Deposits

208

201

190

218

416

1,157

Short-Term Borrowings

324

412

639

498

421

736

553

Subordinated Notes Payable

308

307

311

316

374

615

845

Other Long-Term Borrowings

Total Interest Expense

856

948

1,181

1,044

1,054

1,804

2,646

Net Interest Income

25,980

24,498

24,973

25,122

25,458

50,478

51,231

Provision for Credit Losses

(571)

(982)

1,342

1,308

2,005

(1,553)

6,995

Net Interest Income after Provision for Credit Losses

26,551

25,480

23,631

23,814

23,453

52,031

44,236

NONINTEREST INCOME

Deposit Fees

4,236

4,271

4,713

4,316

3,756

8,507

8,771

Bank Card Fees

3,998

3,618

3,462

3,389

3,142

7,616

6,193

Wealth Management Fees

3,274

3,090

3,069

2,808

2,554

6,364

5,158

Mortgage Banking Revenues

13,217

17,125

17,711

22,983

19,397

30,342

22,650

Other

1,748

1,722

1,568

1,469

1,350

3,470

2,905

Total Noninterest Income

26,473

29,826

30,523

34,965

30,199

56,299

45,677

NONINTEREST EXPENSE

Compensation

25,378

26,064

26,722

26,164

23,658

51,442

43,394

Occupancy, Net

5,973

5,967

5,976

5,906

5,798

11,940

10,777

Other Real Estate, Net

(270)

(118)

567

219

116

(388)

(682)

Pension Adjustment

2,000

Other

9,042

8,563

8,083

8,053

7,731

17,605

14,783

Total Noninterest Expense

42,123

40,476

41,348

40,342

37,303

82,599

68,272

OPERATING PROFIT

10,901

14,830

12,806

18,437

16,349

25,731

21,641

Income Tax Expense

2,059

2,787

2,833

3,165

2,950

4,846

4,232

Net Income

8,842

12,043

9,973

15,272

13,399

20,885

17,409

Pre-Tax Income Attributable to Noncontrolling Interest

(1,415)

(2,537)

(2,227)

(4,875)

(4,253)

(3,952)

(3,976)

NET INCOME ATTRIBUTABLE

COMMON SHAREOWNERS

7,427

9,506

7,746

10,397

9,146

16,933

13,433

PER COMMON SHARE

Basic Net Income

0.44

0.56

0.46

0.62

0.55

1.00

0.80

Diluted Net Income

0.44

0.56

0.46

0.62

0.55

1.00

0.80

Cash Dividend

0.15

0.14

0.30

0.28

AVERAGE

Basic

16,858

16,838

16,763

16,771

16,797

16,848

16,803

Diluted

16,885

16,862

16,817

16,810

16,839

16,874

16,844

CAPITAL CITY BANK GROUP,

INC.

ALLOWANCE FOR CREDIT LOSSES

("ACL")

AND RISK ELEMENT ASSETS

Unaudited

2021

2020

June 30,

(Dollars in thousands, except per share data)

Second

Quarter

First

Quarter

Fourth

Quarter

Third

Quarter

Second

Quarter

2021

2020

ACL - HELD FOR INVESTMENT

Balance at Beginning of Period

22,026

23,816

23,137

22,457

21,083

23,816

13,905

Impact of Adopting ASC 326 (CECL)

3,269

Provision for Credit Losses

(184)

(2,312)

1,165

1,265

1,615

(2,496)

6,605

Net Charge-Offs (Recoveries)

(333)

(522)

486

585

241

(855)

1,322

Balance at End of Period

22,175

22,026

23,816

23,137

22,457

22,175

22,457

As a % of Loans HFI

1.10%

1.07%

1.19%

1.16%

1.11%

1.10%

1.11%

As a % of Nonperforming Loans

433.93%

410.78%

405.66%

420.30%

322.37%

433.93%

322.37%

ACL - UNFUNDED COMMITMENTS

Balance at Beginning of Period

2,974

1,644

1,467

1,424

1,033

1,644

157

Impact of Adopting ASC 326 (CECL)

876

Provision for Credit Losses

(387)

1,330

177

391

943

391

Balance at End of Period

(1)

2,587

2,974

1,644

1,467

1,424

2,587

1,424

CHARGE-OFFS

Commercial, Financial and Agricultural

104

137

186

101

548

Real Estate - Construction

Real Estate - Commercial

Real Estate - Residential

111

Real Estate - Home Equity

Consumer

230

564

668

619

634

794

1,498

Overdrafts

440

492

564

450

541

932

1,243

Total Charge-Offs

841

1,136

1,384

1,282

1,414

1,977

3,494

RECOVERIES

Commercial, Financial and Agricultural

103

136

239

114

Real Estate - Construction

Real Estate - Commercial

645

671

261

Real Estate - Residential

244

153

319

Real Estate - Home Equity

124

194

Consumer

332

311

306

280

365

643

633

Overdrafts

399

367

258

237

549

766

976

Total Recoveries

1,174

1,658

898

697

1,173

2,832

2,172

NET CHARGE-OFFS (RECOVERIES)

(333)

(522)

486

585

241

(855)

1,322

Net Charge-Offs as a % of Average

Loans HFI

(2)

(0.07)%

(0.10)%

0.09%

0.11%

0.05%

(0.08)%

0.14%

RISK ELEMENT ASSETS

Nonaccruing Loans

5,110

5,362

5,871

5,505

6,966

Other Real Estate Owned

1,192

110

808

1,227

1,059

Total Nonperforming Assets ("NPAs")

6,302

5,472

6,679

6,732

8,025

Past Due Loans 30-89 Days

3,745

2,622

4,594

3,191

2,948

Past Due Loans 90 Days or More

Classified Loans

19,397

20,608

17,631

16,772

17,091

Performing Troubled Debt Restructurings

8,992

13,597

13,887

14,693

15,133

Nonperforming Loans as a % of Loans HFI

0.25%

0.26%

0.29%

0.28%

0.34%

NPAs as a % of Loans HFI and Other Real Estate

0.31%

0.27%

0.33%

0.34%

0.40%

NPAs as a % of

Total Assets

0.16%

0.14%

0.18%

0.19%

0.23%

(1)

Recorded in other liabilities

(2)

Annualized

CAPITAL CITY BANK GROUP,

INC.

AVERAGE

BALANCE AND INTEREST RATES

Unaudited

Second Quarter 2021

First Quarter 2021

Fourth Quarter 2020

Third Quarter 2020

Second Quarter 2020

Jun 2021 YTD

Jun 2020 YTD

(Dollars in thousands)

Average

Balance

Interest

Average

Rate

Average

Balance

Interest

Average

Rate

Average

Balance

Interest

Average

Rate

Average

Balance

Interest

Average

Rate

Average

Balance

Interest

Average

Rate

Average

Balance

Interest

Average

Rate

Average

Balance

Interest

Average

Rate

ASSETS:

Loans Held for Sale

77,101

566

2.94

106,242

970

3.70

121,052

878

3.85

92,522

671

3.64

74,965

550

3.41

91,591

1,536

3.38

55,181

906

3.30

Loans Held for Investment

(1)

2,036,781

24,095

4.74

2,044,363

22,483

4.46

1,993,470

23,103

4.55

2,005,178

23,027

4.53

1,982,960

23,235

4.70

2,040,551

46,578

4.71

1,915,370

46,571

4.89

Investment Securities

Taxable Investment Securities

687,882

2,036

1.18

528,842

1,863

1.41

513,277

2,072

1.61

553,395

2,401

1.73

601,509

2,708

1.80

608,801

3,899

1.28

615,511

5,703

1.86

Tax-Exempt Investment Securities

(1)

3,530

2.58

3,844

2.61

4,485

2.71

4,860

2.66

5,865

2.51

3,686

2.60

5,579

2.20

Total Investment Securities

691,412

2,059

1.19

532,686

1,888

1.42

517,762

2,102

1.62

558,255

2,433

1.74

607,374

2,745

1.81

612,487

3,947

1.29

621,090

5,765

1.86

Funds Sold

818,616

200

0.10

814,638

214

0.11

705,125

180

0.10

567,883

146

0.10

351,473

0.10

816,638

414

0.10

292,922

845

0.58

Total Earning Assets

3,623,910

26,920

2.98

3,497,929

25,555

2.96

3,337,409

26,263

3.14

3,223,838

26,277

3.25

3,016,772

26,618

3.55

3,561,267

52,475

2.97

2,884,563

54,087

3.77

Cash and Due From Banks

74,076

68,978

73,968

69,893

72,647

71,541

64,802

Allowance for Loan Losses

(22,794)

(24,128)

(23,725)

(22,948)

(21,642)

(23,457)

(18,015)

Other Assets

281,157

278,742

264,784

268,549

261,449

279,956

252,657

Total Assets

3,956,349

3,821,521

3,652,436

3,539,332

3,329,226

3,889,307

3,184,007

LIABILITIES:

Interest Bearing Deposits

NOW Accounts

966,649

0.03

985,517

0.03

879,564

0.03

826,776

0.03

789,378

0.04

976,031

150

0.03

799,094

803

0.20

Money Market Accounts

272,138

0.05

269,829

0.05

261,543

0.05

247,185

0.05

222,377

0.07

270,990

0.05

217,295

157

0.15

Savings Accounts

529,844

0.05

492,252

0.05

466,116

0.05

438,762

0.05

409,366

0.05

511,152

124

0.05

394,301

0.05

Time Deposits

102,995

0.15

102,089

0.15

102,809

0.17

104,522

0.16

104,718

0.19

102,544

0.15

105,130

101

0.19

Total Interest Bearing Deposits

1,871,626

208

0.04

1,849,687

208

0.05

1,710,032

201

0.05

1,617,245

190

0.05

1,525,839

218

0.06

1,860,717

416

0.05

1,515,820

1,157

0.15

Short-Term Borrowings

51,152

324

2.54

67,033

412

2.49

95,280

639

2.67

74,557

498

2.66

73,377

421

2.31

59,049

736

2.51

53,146

553

2.09

Subordinated Notes Payable

52,887

308

2.30

52,887

307

2.32

52,887

311

2.30

52,887

316

2.34

52,887

374

2.80

52,887

615

2.31

52,887

845

3.16

Other Long-Term Borrowings

1,762

3.38

2,736

3.18

3,700

3.18

5,453

2.91

5,766

2.84

2,246

3.26

6,039

3.03

Total Interest Bearing Liabilities

1,977,427

856

0.17

1,972,343

948

0.19

1,861,899

1,181

0.25

1,750,142

1,044

0.24

1,657,869

1,054

0.26

1,974,899

1,804

0.18

1,627,892

2,646

0.33

Noninterest Bearing Deposits

1,515,726

1,389,821

1,356,104

1,354,032

1,257,614

1,453,121

1,152,251

Other Liabilities

107,801

111,050

74,605

83,192

72,073

109,417

65,830

Total Liabilities

3,600,954

3,473,214

3,292,608

3,187,366

2,987,556

3,537,437

2,845,973

Temporary Equity

26,355

21,977

16,154

11,893

8,155

24,178

5,331

SHAREOWNERS' EQUITY:

329,040

326,330

343,674

340,073

333,515

327,692

332,703

Total Liabilities, Temporary

Equity and

Shareowners' Equity

3,956,349

3,821,521

3,652,436

3,539,332

3,329,226

3,889,307

3,184,007

Interest Rate Spread

26,064

2.81

24,607

2.77

25,082

2.88

25,233

3.01

25,564

3.30

50,671

2.79

51,441

3.44

Interest Income and Rate Earned

(1)

26,920

2.98

25,555

2.96

26,263

3.14

26,277

3.25

26,618

3.55

52,475

2.97

54,087

3.77

Interest Expense and Rate Paid

(2)

856

0.09

948

0.11

1,181

0.14

1,044

0.13

1,054

0.14

1,804

0.10

2,646

0.18

Net Interest Margin

26,064

2.89

24,607

2.85

25,082

3.00

25,233

3.12

25,564

3.41

50,671

2.87

51,441

3.59

(1)

Interest and average rates are calculated

on a tax-equivalent basis using a 21% Federal tax rate.

(2)

Rate calculated based on average earning assets.

CAPITAL CITY HOME

LOANS

MORTGAGE BANKING ACTIVITY

Unaudited

Three Months Ended

Six Months Ended

(Dollars in thousands)

Jun 30, 2021

Mar 31, 2021

Jun 30, 2020

Jun 30, 2021

Jun 30, 2020

Net Interest Income

(153)

109

(134)

125

Mortgage Banking Fees

13,116

16,846

19,156

29,962

21,271

Other

425

426

203

851

299

Total Noninterest

Income

13,541

17,272

19,359

30,813

21,570

Salaries

8,538

10,276

8,381

18,814

10,623

Other Associate Benefits

210

221

204

431

253

Total Compensation

8,748

10,497

8,585

19,245

10,876

Occupancy, Net

854

861

768

1,715

999

Other

1,359

1,101

1,248

2,460

1,705

Total Noninterest

Expense

10,961

12,459

10,601

23,420

13,580

Operating Profit

2,599

4,660

8,867

7,259

8,115

Key Performance Metrics

Total Loans Closed

406,859

463,126

407,118

869,985

510,008

Total Loans Closed

Purchase

76%

60%

51%

68%

53%

Refinance

24%

40%

49%

32%

47%