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):

January 24, 2023

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-

CURRENT REPORT

Item 2.02.

Results of Operations and Financial Condition.

On January 24, 2023, Capital City Bank Group, Inc. (“CCBG”) issued an earnings

press release reporting CCBG’s financial

results for the three and twelve month periods ended December 31,

2022.

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 January 24, 2023.

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:

January 24, 2023

By:

/s/ Jep Larkin

Jep Larkin,

Executive Vice President

and Chief Financial Officer

EXHIBIT INDEX

Exhibit

Number

Description

99.1

Press Release dated January 24, 2023

ex991

Capital City Bank Group, Inc.

Reports Fourth Quarter 2022 Results

TALLAHASSEE, Fla.

(January 24, 2023) – Capital City Bank Group, Inc. (NASDAQ:

CCBG) today reported net income

attributable to common shareowners

of $11.7

million, or $0.68 per diluted share, for the fourth quarter of 2022 compared to net

income of $11.3 million, or $0.67 per diluted

share, for the third quarter of 2022, and $6.4 million, or $0.38 per diluted share, for the

fourth quarter of 2021.

For the full year of 2022, net income attributable to common shareowners totaled

$40.1 million, or $2.36 per diluted share, compared

to net income of $33.4 million, or $1.98 per diluted share, for the same period

of 2021.

QUARTER HIGHLIGHTS (4th Quarter 2022 versus 3rd Quarter 2022)

●

Continued strong growth

in net interest income of 14% - net interest

margin percentage

grew 45 basis points to 3.76% - deposit

cost well controlled at 20 basis points (total

deposits) and 35 basis points (interest bearing deposits)

●

Loan growth of $179 million, or 7.6% (end of

period) and $175 million, or 7.7% (average)

●

Continued strong credit

quality metrics – higher credit loss provision

primarily driven by loan growth

●

Noninterest income decreased

$1.9 million, or 8.5%, primarily due to lower mortgage banking revenues

at CCHL – strong

adjustable rate portfolio production by

CCHL contributed to loan growth for the quarter

●

Noninterest expense included a pension

settlement charge of $1.8 million, or $0.08 per share

●

Tangible

book value per share increased

$1.19, or 7.2%, primarily due to strong earnings and

a favorable re-measurement

adjustment for pension plan

Full Year

2022 HIGHLIGHTS

●

Strong growth

in net interest income of 21% reflected

improved earning asset mix and strength

of deposit franchise

●

Loan growth of $594 million, or 30.7% (end

of period) and $189 million, or 9.4% (year-to-date average)

●

Average Deposits grew

$356 million, or 10.5%

●

CCHL contribution decreased $0.24 per share

due to slower secondary market loan sales, but was more

than offset by strong

adjustable rate production for our loan portfolio

and higher wealth and deposit fees

●

Noninterest expense included pension

settlement charges totaling $2.3 million or $0.11

per share

●

Tangible

book value per share increased

$0.54, or 3.2%, primarily due to strong earnings and

a favorable re-measurement

adjustment for pension plan, partially offset by higher unreal

ized investment security losses

“Capital City finished out the year with another solid quarter highlighted by continued

net interest margin expansion and nice

tangible book value growth,” said William G. Smith,

Jr., Chairman, President,

and CEO of Capital City Bank Group.

“I am proud

of our associates who produced another record year of earnings. For the quarter

and year, we realized strong loan growth, stable

deposit growth, maintained good control of our deposit cost, and credit quality

was strong.

Still, we remain vigilant in the face of

economic uncertainty.

As we begin 2023, I am confident in our positioning, markets and strategic initiatives.

Thank you to our

associates for their tireless efforts serving our clients with excellence

and to our shareowners for their continued support.”

Discussion of Operating Results

Net Interest Income/Net Interest

Margin

Tax-equivalent net

interest income for the fourth quarter of 2022 totaled $38.2 million, compared

to $33.4 million for the third

quarter of 2022, and $24.8 million for the fourth quarter of 2021.

For the full year of 2022, tax-equivalent net interest income totaled

$124.8 million compared to $103.2 million for the same period of 2021.

Compared to the third quarter of 2022, the increase

primarily reflected strong loan growth and higher interest rates across a majority

of our earning assets.

Compared to both prior year

periods, the increase reflected strong loan growth, higher interest rates, and

growth in the investment portfolio.

Our net interest margin for the fourth quarter of 2022 was 3.76%,

an increase of 45 basis points over the third quarter of 2022 and

116 basis points over the fourth quarter

of 2021, both driven by higher interest rates and an overall improved earning

asset mix.

For

the fourth quarter of 2022, our cost of funds was 31 basis points, an increase

of 11 basis points over the third quarter of 2022

and 22

basis points over the fourth quarter of 2021.

Our cost of interest bearing deposits was 35 basis points, 20 basis points, and 4 basis

points for the same aforementioned periods.

For the month of December 2022, our net interest margin was 3.86%.

Compared to the

full year of 2021, the net interest margin increased by 30 basis points to 3.13%

as the favorable impact of higher interest rates and an

improved earning asset mix offset the favorable impact

in 2021 from a significant level of SBA Paycheck Protection Program fee

income.

Provision for Credit Losses

We recorded

a provision for credit losses of $3.5 million for the fourth quarter of 2022 compared to $2.1

million in the third quarter

of 2022 and no provision for the fourth quarter of 2021.

For the full year of 2022, the provision was $7.2 million compared to a

benefit of $1.6 million for the same period of 2021.

The higher level of provision compared to all prior periods was primarily

attributable to strong loan growth and weaker projected economic

conditions, primarily a higher

rate of unemployment.

The credit

loss provision in 2021 was favorably impacted by strong loan recoveries.

We discuss the allowance

for credit losses further below.

Noninterest Income and Noninterest

Expense

Noninterest income for the fourth quarter of 2022 totaled $21.0 million

compared to $22.9 million for the third quarter of 2022

and

$24.7 million for the fourth quarter of 2021.

The $1.9 million decrease from the third quarter of 2022 was attributable to lower

mortgage banking revenues of $1.6

million, wealth management fees of $0.3

million, deposit fees of $0.4

million, and bank card

fees of $0.1 million, partially offset by higher other

income of $0.5 million.

The decrease in deposit fees was partially attributable

to three less processing days in the fourth quarter.

Compared to the fourth quarter of 2021, the $3.7 million decrease was

attributable to lower mortgage banking revenues of $4.3 million, wealth management

fees of $0.1 million, and bank card fees of

$0.1 million, partially offset by higher other income

of $0.6

million and deposit fees of $0.2 million.

For the full year of 2022, noninterest income totaled $94.6 million

compared to $107.5 million for the same period of 2021 and

reflected lower mortgage banking revenues of $21.8 million, partially

offset by higher wealth management fees of $4.4

million,

deposit fees of $3.2 million, other income of $1.2 million, and bank card fees

of $0.1 million.

Lower mortgage banking revenues at

Capital City Home Loans (“CCHL”) for 2022 reflected a reduction

in refinancing activity and, to a lesser degree,

lower purchase

mortgage originations primarily driven by higher interest rates.

In addition, gain on sale margins were pressured due

to a lower

level of governmental loan originations and mandatory delivery loan

sales (both of which provide a higher gain on sale percentage).

Throughout 2022, strong best efforts origination

volume allowed us to book a steady flow of adjustable rate residential loans in

our

portfolio which contributed to loan growth and earnings.

In addition, continued stability in our construction/permanent loan

program partially offset the slowdown in secondary

market originations.

For 2022, CCHL realized a $0.2 million net loss ($0.01

per diluted share) versus $3.9 million net income ($0.23 per diluted

share) in 2021.

Noninterest expense for the fourth quarter of 2022 totaled $42.3 million

compared to $39.8 million for the third quarter of 2022

and

$40.2 million for the fourth quarter of 2021.

The $2.5 million increase over the third quarter of 2022 was primarily attributable to

higher other expense of $1.6 million and compensation expense of

$0.8 million.

Higher pension plan settlement expense of $1.7

million drove the increase in other expense.

The increase in compensation expense was primarily due to higher

variable/performance-based compensation of $0.3 million

and lower realized loan cost of $0.3 million (credit offset to salary

expense).

Compared to the fourth quarter of 2021, the $2.1 million increase reflected higher other

expense of $1.0 million,

compensation expense of $0.8 million, and occupancy expense of $0.3 million.

The increase in other expense reflected higher

expense for legal, travel/entertainment, FDIC insurance fees, mortgage servicing

right amortization, and loan servicing costs.

The

higher level of compensation expense was due to higher base salary expense

reflective of annual merit raises and staffing additions

related to new market expansion during 2022 and stock based compensation

expense related to improved company performance for

2022.

For the full year 2022, noninterest expense totaled $161.8 million compared

to $162.5 million for the same period of 2021 and

reflected lower compensation expense of $0.9 million and

other expense of $0.4

million, partially offset by higher occupancy

expense of $0.6

million.

The reduction in compensation expense was primarily due to lower variable/performance

-based

compensation of $7.7 million and base salaries of $1.3 million at CCHL, partially

offset by higher compensation at Capital City

Bank, including variable/performance-based compensation totaling

$2.5 million, base salaries (merit and new market staffing

additions) of $3.1 million, lower realized loan cost of $1.4 million (credit

offset to salary expense), associate insurance expense

(utilized self-insurance reserves in 2021)

of $0.6 million and stock compensation expense of $0.7 million.

The decrease in other

expense was primarily due to a decrease in pension related costs, including

$4.9 million for the non-service related component and

$0.8 million for pension plan settlement expense, partially offset

by higher expense for other real estate expense of $1.2

million,

travel/entertainment and advertising costs totaling $1.3

million (return to pre-pandemic levels and market expansion), other losses

of $0.9 million (primarily debit card and check fraud),

mortgage servicing right amortization of $0.6

million, VISA Class B share

swap conversion ratio payments of $0.4 million, FDIC insurance fees of

$0.3 million, and other miscellaneous costs for training,

hiring, and variable expenses related to loan production.

Gains from the sale of two banking offices in 2021 drove the increase in

other real estate expense.

The increase in occupancy expense is related to lease expense for four new

banking offices added in 2022

and various software purchases, including network security and end of

life upgrades.

Income Taxes

We realized income

tax expense of $2.6 million (effective rate of 19.6%) for the

fourth quarter of 2022

compared to $3.1 million

(effective rate of 21.4%) for the third quarter of 2022

and $2.0

million (effective rate of 22.2%) for the fourth quarter of 2021.

The

decrease in the effective tax rate for the fourth quarter of 2022 was due

to a favorable $0.4 million discrete tax item related to our

SERP plan.

For the full year of 2022, we realized income tax expense of $10.1 million

(effective rate of 20.1%) compared to $9.8

million (effective rate of 19.9%) for the same period of 2021.

Absent discrete items, we expect our annual effective tax rate to

approximate 21%-22% in 2023.

Discussion of Financial Condition

Earning Assets

Average earning

assets totaled $4.033 billion for the fourth quarter of 2022, an increase of $22.8 million, or

0.6%, over the third

quarter of 2022, and an increase of $241.4 million, or 6.4%, over

the fourth quarter of 2021.

The increase over both prior periods

was primarily driven by higher deposit balances (see below –

Funding

The mix of earning assets continues to improve driven by

strong loan growth.

We maintained

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

sold less FED funds purchased)

sold position of $469.4 million in the fourth quarter of 2022 compared

to $570.0 million in the third quarter of 2022 and $789.1

million in the fourth quarter of 2021. The declining overnight funds

position reflects growth in average loans.

Average loans

held for investment (“HFI”) increased $175.3 million, or 7.7%, over the third quarter of 2022

and $491.1 million, or

25.2%, over the fourth quarter of 2021.

Period end loans increased $179.0 million, or 7.6%, over the third quarter of 2022 and

$593.7 million, or 30.7%, over the fourth quarter of 2021.

The growth in 2022 was broad based with increases realized in all loan

categories, more significantly,

in the residential real estate, construction,

and commercial real estate categories.

Allowance for Credit Losses

At December 31, 2022, the allowance for credit losses for HFI loans totaled

$24.7 million compared to $22.5 million at September

30, 2022 and $21.6 million at December 31, 2021.

Activity within the allowance is provided on Page 9.

Incremental allowance

related to loan growth, a higher projected rate of unemployment and

its effect on rates of default, and slower prepayment speeds

(due to higher interest rates) were all contributing factors driving

the increase in the allowance during 2022.

At December 31, 2022,

the allowance represented 0.98% of HFI loans compared to 0.96% at September

30, 2022, and 1.12% at December 31, 2021.

Credit Quality

Overall credit quality remains strong.

Nonperforming assets (nonaccrual loans and other real estate) totaled $2.7

million at

December 31, 2022 compared to $2.4 million at September 30, 2022

and $4.3 million at December 31, 2021.

At December 31,

2022, nonperforming assets as a percent of total assets equaled 0.06%,

compared to 0.06% at September 30, 2022 and 0.10% at

December 31, 2021.

Nonaccrual loans totaled $2.2 million at December 31, 2022, a $0.2 million decrease

from September 30, 2022

and a $2.1 million decrease from December 31, 2021.

Further, classified loans totaled $19.3 million at December

31, 2022, a $1.6

million decrease from September 30, 2022 and a $1.4 million increase

over December 31, 2021.

Funding (Deposits/Debt)

Average total

deposits were $3.803 billion for the fourth quarter of 2022, an increase of $33.2 million, or 0.9%, over

the third

quarter of 2022 and $253.9 million, or 7.2%, over the fourth quarter

of 2021.

Compared to the third quarter of 2022, the increase

reflected higher NOW account balances, primarily due to a seasonal increase

in our public fund deposits.

Compared to the fourth

quarter of 2021, we have had strong growth in our noninterest bearing,

NOW, and

savings account balances.

We continue to

closely monitor our cost of deposits and deposit mix as we manage through

this rising rate environment.

Capital

Shareowners’ equity was $394.0 million at December 31, 2022

compared to $373.2 million at September 30, 2022 and $383.2

million at December 31, 2021.

For the full year 2022, shareowners’ equity was positively impacted by net

income attributable to

common shareowners of $40.1 million, a $3.1 million increase in the

fair value of the interest rate swap related to subordinated debt,

stock compensation accretion of $1.3 million, net adjustments totaling

$1.6 million related to transactions under our stock

compensation plans, and an $8.7 million decrease in the accumulated

other comprehensive loss for our pension plan.

Shareowners’

equity was reduced by common stock dividends

of $11.2 million ($0.66 per share) and a $32.8 million

increase in the unrealized

loss on investment securities.

At December 31, 2022, our total risk-based capital ratio was 15.52%

compared to 15.75% at September 30, 2022 and 17.15% at

December 31, 2021.

Our common equity tier 1 capital ratio was 12.64%, 12.83%, and 13.86%,

respectively, on these

dates.

Our

leverage ratio was 9.06%, 8.91%, and 8.95%, respectively,

on these dates.

Further, our tangible common equity ratio was 6.79%

December 31, 2022 compared to 6.61% and 6.95% at September 30, 2022

and December 31, 2021, respectively.

The decline in our

regulatory capital ratios compared to 2021 was attributable to strong loan growth

during 2022.

At December 31, 2022, all of our

regulatory capital ratios exceeded the threshold to be designated as “well-capitalized”

under the Basel III capital standards.

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 $4.5 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

financial advisory services, including the sale of life insurance, risk management

and asset protection services.

Our bank

subsidiary, Capital City Bank,

was founded in 1895 and now has 58 banking offices and 89 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 words “may,” “could,” “should,”

“would,” “believe,”

“anticipate,” “estimate,” “expect,” “intend,” “plan,” “target,” “vision,”

“goal,” and similar expressions are intended to identify

forward-looking statements. The following factors, among others, could cause our actual

results to differ: our ability to successfully

manage credit risk, interest rate risk, liquidity risk, and other risks inherent

to our industry; legislative or regulatory changes;

fluctuations in inflation, interest rates, or monetary and fiscal policies; the effects

of security breaches and computer viruses that may

affect our computer systems; the accuracy of our financial

statement estimates and assumptions; fraud related to debit card products;

changes in accounting principles, policies, practices, or guidelines; the frequency

and magnitude of foreclosure on our loans; the

effects of a non-diversified loan portfolio, including the

risks of geographic and industry concentrations; the strength of the U.S.

economy and the local economies where we conduct operations; our

ability to declare and pay dividends, the payment of which is

subject to our capital requirements; changes in the stock market and other

capital and real estate markets; structural changes in the

markets for origination, sale and servicing of residential mortgages; uncertainty

in the pricing of residential mortgage loans that we

sell, as well as competition for the mortgage servicing rights related to these loans

and related interest rate risk or price risk resulting

from retaining mortgage servicing rights and the potential effects of

higher interest rates on our loan origination volumes; the effect

of corporate restructuring, acquisitions or dispositions, including the

actual restructuring and other related charges and the failure to

achieve the expected gains, revenue growth or expense savings from such

corporate restructuring, acquisitions or dispositions; the

effects of natural disasters, harsh weather conditions (including

hurricanes), widespread health emergencies (including pandemics,

such as the COVID-19 pandemic), military conflict, terrorism, civil unrest

or other geopolitical events; our ability to comply with the

extensive laws and regulations to which we are subject, including the

laws for each jurisdiction where we operate; the willingness of

clients to accept third-party products and services rather than our products and

services and vice versa; increased competition and its

effect on pricing; technological changes; the outcomes of

litigation or regulatory proceedings; negative publicity and the impact on

our reputation; changes in consumer spending and saving habits; growth

and profitability of our noninterest income; the limited

trading activity of our common stock; the concentration of ownership of our

common stock; anti-takeover provisions under federal

and state law as well as our Articles of Incorporation and our Bylaws; other risks described

from time to time in our filings with the

Securities and Exchange Commission; 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, 2021, 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)

Dec 31, 2022

Sep 30, 2022

Jun 30, 2022

Mar 31, 2022

Dec 31, 2021

Shareowners' Equity (GAAP)

394,016

373,165

371,675

372,145

383,166

Less: Goodwill and Other Intangibles (GAAP)

93,093

93,133

93,173

93,213

93,253

Tangible Shareowners' Equity (non-GAAP)

300,923

280,032

278,502

278,932

289,913

Total Assets (GAAP)

4,525,958

4,332,671

4,354,297

4,310,045

4,263,849

Less: Goodwill and Other Intangibles (GAAP)

93,093

93,133

93,173

93,213

93,253

Tangible Assets (non-GAAP)

4,432,865

4,239,538

4,261,124

4,216,832

4,170,596

Tangible Common Equity Ratio (non-GAAP)

A/B

6.79%

6.61%

6.54%

6.61%

6.95%

Actual Diluted Shares Outstanding (GAAP)

17,039,401

16,998,177

16,981,614

16,962,362

16,935,389

Tangible

Book Value per Diluted Share (non-GAAP)

A/C

17.66

16.47

16.40

16.44

17.12

CAPITAL CITY BANK

GROUP,

INC.

EARNINGS HIGHLIGHTS

Unaudited

Three Months Ended

Twelve Months Ended

(Dollars in thousands, except per share data)

Dec 31, 2022

Sep 30, 2022

Dec 31, 2021

Dec 31, 2022

Dec 31, 2021

EARNINGS

Net Income Attributable to Common Shareowners

11,664

11,315

6,372

40,147

33,396

Diluted Net Income Per Share

0.68

0.67

0.38

2.36

1.98

PERFORMANCE

Return on Average Assets

1.06

1.03

0.61

0.93

0.84

Return on Average Equity

12.16

11.83

7.22

10.58

9.92

Net Interest Margin

3.76

3.31

2.60

3.13

2.83

Noninterest Income as % of Operating Revenue

35.50

40.76

49.96

43.19

51.11

Efficiency Ratio

71.47

70.66

81.29

73.76

77.11

CAPITAL ADEQUACY

Tier 1 Capital

14.53

14.80

16.14

14.53

16.14

Total Capital

15.52

15.75

17.15

15.52

17.15

Leverage

9.06

8.91

8.95

9.06

8.95

Common Equity Tier 1

12.64

12.83

13.86

12.64

13.86

Tangible Common Equity

(1)

6.79

6.61

6.95

6.79

6.95

Equity to Assets

8.71

8.61

8.99

8.71

8.99

ASSET QUALITY

Allowance as % of Non-Performing Loans

1,076.89

934.53

499.93

1,076.89

499.93

Allowance as a % of Loans HFI

0.98

0.96

1.12

0.98

1.12

Net Charge-Offs as % of Average Loans HFI

0.21

0.12

0.02

0.18

(0.03)

Nonperforming Assets as % of Loans HFI and OREO

0.11

0.10

0.22

0.11

0.22

Nonperforming Assets as % of Total Assets

0.06

0.10

0.06

0.10

STOCK PERFORMANCE

High

36.23

33.93

29.00

36.23

29.00

Low

31.14

27.41

24.77

24.43

21.42

32.50

31.11

26.40

32.50

26.40

Average Daily Trading Volume

31,894

30,546

29,900

27,987

29,919

(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

2022

2021

(Dollars in thousands)

Fourth Quarter

Third Quarter

Second Quarter

First Quarter

Fourth Quarter

ASSETS

Cash and Due From Banks

72,114

72,686

91,209

77,963

65,313

Funds Sold and Interest Bearing Deposits

528,536

497,679

603,315

790,465

970,041

Total Cash and Cash Equivalents

600,650

570,365

694,524

868,428

1,035,354

Investment Securities Available for Sale

413,294

416,745

601,405

624,361

654,611

Investment Securities Held to Maturity

660,744

676,178

528,258

518,678

339,601

Other Equity Securities

1,349

900

855

861

Total Investment Securities

1,074,048

1,094,272

1,130,563

1,143,894

995,073

Loans Held for Sale

54,635

50,304

48,708

50,815

52,532

Loans Held for Investment ("HFI"):

Commercial, Financial, & Agricultural

247,362

246,304

247,902

230,213

223,086

Real Estate - Construction

234,519

237,718

225,664

174,293

174,394

Real Estate - Commercial

782,557

715,870

699,093

669,110

663,550

Real Estate - Residential

721,759

573,963

478,121

368,020

346,756

Real Estate - Home Equity

208,120

202,512

194,658

188,174

187,821

Consumer

324,450

347,949

359,906

347,785

321,511

Other Loans

5,346

20,822

6,854

6,692

13,265

Overdrafts

1,067

1,047

1,455

1,222

1,082

Total Loans Held for Investment

2,525,180

2,346,185

2,213,653

1,985,509

1,931,465

Allowance for Credit Losses

(24,736)

(22,510)

(21,281)

(20,756)

(21,606)

Loans Held for Investment, Net

2,500,444

2,323,675

2,192,372

1,964,753

1,909,859

Premises and Equipment, Net

82,138

81,736

82,932

82,518

83,412

Goodwill and Other Intangibles

93,093

93,133

93,173

93,213

93,253

Other Real Estate Owned

431

Other Assets

120,519

119,173

111,935

106,407

94,349

Total Other Assets

296,181

294,055

288,130

282,155

271,031

Total Assets

4,525,958

4,332,671

4,354,297

4,310,045

4,263,849

LIABILITIES

Deposits:

Noninterest Bearing Deposits

1,653,620

1,737,046

1,724,671

1,704,329

1,668,912

NOW Accounts

1,290,494

990,021

1,036,757

1,062,498

1,070,154

Money Market Accounts

267,383

292,932

289,337

288,877

274,611

Savings Accounts

637,374

646,526

639,594

614,599

599,811

Certificates of Deposit

90,446

92,853

95,899

95,204

99,374

Total Deposits

3,939,317

3,759,378

3,786,258

3,765,507

3,712,862

Short-Term Borrowings

56,793

52,271

39,463

30,865

34,557

Subordinated Notes Payable

52,887

Other Long-Term Borrowings

513

562

612

806

884

Other Liabilities

73,675

84,657

93,319

77,323

67,735

Total Liabilities

4,123,185

3,949,755

3,972,539

3,927,388

3,868,925

Temporary Equity

8,757

9,751

10,083

10,512

11,758

SHAREOWNERS' EQUITY

Common Stock

170

169

Additional Paid-In Capital

37,331

36,234

35,738

35,188

34,423

Retained Earnings

393,744

384,964

376,532

370,531

364,788

Accumulated Other Comprehensive Loss, Net of Tax

(37,229)

(48,203)

(40,765)

(33,743)

(16,214)

Total Shareowners' Equity

394,016

373,165

371,675

372,145

383,166

Total Liabilities, Temporary Equity and Shareowners' Equity

4,525,958

4,332,671

4,354,297

4,310,045

4,263,849

OTHER BALANCE SHEET DATA

Earning Assets

4,182,399

3,988,440

3,996,238

3,970,684

3,949,111

Interest Bearing Liabilities

2,395,890

2,128,052

2,154,549

2,145,736

2,132,278

Book Value Per Diluted Share

23.12

21.95

21.89

21.94

22.63

Tangible Book Value

Per Diluted Share

(1)

17.66

16.47

16.40

16.44

17.12

Actual Basic Shares Outstanding

16,987

16,962

16,959

16,948

16,892

Actual Diluted Shares Outstanding

17,039

16,998

16,982

16,962

16,935

(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

2022

2021

December 31,

(Dollars in thousands, except per share data)

Fourth

Quarter

Third

Quarter

Second

Quarter

First

Quarter

Fourth

Quarter

2022

2021

INTEREST INCOME

Loans, including Fees

31,916

27,761

24,072

22,133

22,744

105,882

96,561

Investment Securities

4,847

4,372

3,840

2,896

2,505

15,955

8,792

Federal Funds Sold and Interest Bearing Deposits

4,463

3,231

1,408

409

300

9,511

998

Total Interest Income

41,226

35,364

29,320

25,438

25,549

131,348

106,351

INTEREST EXPENSE

Deposits

1,902

1,052

266

224

213

3,444

839

Short-Term Borrowings

690

536

343

192

307

1,761

1,360

Subordinated Notes Payable

522

443

370

317

306

1,652

1,228

Other Long-Term Borrowings

Total Interest Expense

3,122

2,037

987

742

838

6,888

3,490

Net Interest Income

38,104

33,327

28,333

24,696

24,711

124,460

102,861

Provision for Credit Losses

3,521

2,099

1,542

7,162

(1,553)

Net Interest Income after Provision for Credit Losses

34,583

31,228

26,791

24,696

24,711

117,298

104,414

NONINTEREST INCOME

Deposit Fees

5,536

5,947

5,447

5,191

5,300

22,121

18,882

Bank Card Fees

3,744

3,860

4,034

3,763

3,872

15,401

15,274

Wealth Management Fees

3,649

3,937

4,403

6,070

3,706

18,059

13,693

Mortgage Banking Revenues

5,497

7,116

9,065

8,946

9,800

30,624

52,425

Other

2,546

2,074

1,954

1,848

1,994

8,422

7,271

Total Noninterest Income

20,972

22,934

24,903

25,818

24,672

94,627

107,545

NONINTEREST EXPENSE

Compensation

25,565

24,738

25,383

24,856

24,783

100,542

101,470

Occupancy, Net

6,253

6,153

6,075

6,093

5,960

24,574

23,932

Other

10,469

8,919

9,040

8,284

9,464

36,712

37,106

Total Noninterest Expense

42,287

39,810

40,498

39,233

40,207

161,828

162,508

OPERATING PROFIT

13,268

14,352

11,196

11,281

9,176

50,097

49,451

Income Tax Expense

2,599

3,074

2,177

2,235

2,040

10,085

9,835

Net Income

10,669

11,278

9,019

9,046

7,136

40,012

39,616

Pre-Tax Loss (Income) Attributable to Noncontrolling Interest

995

(306)

(591)

(764)

135

(6,220)

NET INCOME ATTRIBUTABLE

COMMON SHAREOWNERS

11,664

11,315

8,713

8,455

6,372

40,147

33,396

PER COMMON SHARE

Basic Net Income

0.69

0.67

0.51

0.50

0.38

2.37

1.98

Diluted Net Income

0.68

0.67

0.51

0.50

0.38

2.36

1.98

Cash Dividend

0.17

0.16

0.66

0.62

AVERAGE

Basic

16,963

16,960

16,949

16,931

16,880

16,951

16,863

Diluted

17,016

16,996

16,971

16,946

16,923

16,985

16,893

CAPITAL CITY BANK GROUP,

INC.

ALLOWANCE FOR CREDIT LOSSES ("ACL")

AND CREDIT QUALITY

Unaudited

2022

2021

December 31,

(Dollars in thousands, except per share data)

Fourth

Quarter

Third

Quarter

Second

Quarter

First

Quarter

Fourth

Quarter

2022

2021

ACL - HELD FOR INVESTMENT LOANS

Balance at Beginning of Period

22,510

21,281

20,756

21,606

21,500

21,606

23,816

Provision for Credit Losses

3,543

1,931

1,670

(79)

200

7,065

(2,842)

Net Charge-Offs (Recoveries)

1,317

702

1,145

771

3,935

(632)

Balance at End of Period

24,736

22,510

21,281

20,756

21,606

24,736

21,606

As a % of Loans HFI

0.98%

0.96%

1.05%

1.12%

0.98%

1.12%

As a % of Nonperforming Loans

1,076.89%

934.53%

677.57%

760.83%

499.93%

1,076.89%

499.93%

ACL - UNFUNDED COMMITMENTS

Balance at Beginning of Period

3,012

2,853

2,976

2,897

3,117

2,897

1,644

Provision for Credit Losses

(23)

159

(123)

(220)

1,253

Balance at End of Period

(1)

2,989

3,012

2,853

2,976

2,897

2,989

2,897

ACL - DEBT SECURITIES

Provision for Credit Losses

(5)

CHARGE-OFFS

Commercial, Financial and Agricultural

129

1,104

101

1,308

239

Real Estate - Construction

Real Estate - Commercial

266

355

405

Real Estate - Residential

108

Real Estate - Home Equity

160

193

103

Consumer

976

770

533

622

254

2,901

1,269

Overdrafts

720

989

660

780

678

3,149

2,703

Total Charge-Offs

2,073

1,762

2,297

1,774

1,062

7,906

4,827

RECOVERIES

Commercial, Financial and Agricultural

165

148

307

453

Real Estate - Construction

Real Estate - Commercial

106

865

Real Estate - Residential

115

284

753

Real Estate - Home Equity

173

183

413

Consumer

175

260

453

183

214

1,071

1,191

Overdrafts

409

666

402

533

375

2,010

1,774

Total Recoveries

756

1,060

1,152

1,003

968

3,971

5,459

NET CHARGE-OFFS (RECOVERIES)

1,317

702

1,145

771

3,935

(632)

Net Charge-Offs as a % of Average Loans

HFI

(2)

0.21%

0.12%

0.22%

0.16%

0.02%

0.18%

(0.03)%

CREDIT QUALITY

Nonaccruing Loans

2,297

2,409

3,141

2,728

4,322

Other Real Estate Owned

431

Total Nonperforming Assets ("NPAs")

2,728

2,422

3,231

2,745

4,339

Past Due Loans 30-89 Days

7,829

6,263

3,554

3,120

3,600

Past Due Loans 90 Days or More

Classified Loans

19,342

20,988

19,620

22,348

17,912

Performing Troubled Debt Restructurings

5,913

6,261

6,728

7,304

7,643

Nonperforming Loans as a % of Loans HFI

0.09%

0.10%

0.14%

0.22%

NPAs as a % of Loans HFI and Other Real Estate

0.11%

0.10%

0.15%

0.14%

0.22%

NPAs as a % of

Total Assets

0.06%

0.07%

0.06%

0.10%

(1)

Recorded in other liabilities

(2)

Annualized

CAPITAL CITY BANK GROUP,

INC.

AVERAGE

BALANCE AND INTEREST RATES

Unaudited

Fourth Quarter 2022

Third Quarter 2022

Second Quarter 2022

First Quarter 2022

Fourth Quarter 2021

Dec 2022 YTD

Dec 2021 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

42,910

581

5.38

55,164

486

4.82

52,860

711

4.44

43,004

397

3.19

62,809

522

3.29

48,502

2,175

4.49

78,328

2,555

3.24

Loans Held for Investment

(1)

2,439,379

31,418

5.11

2,264,075

27,354

4.76

2,084,679

23,433

4.53

1,963,578

21,811

4.52

1,948,324

22,296

4.54

2,189,440

104,016

4.75

2,000,563

94,332

4.76

Investment Securities

Taxable Investment Securities

1,078,265

4,835

1.78

1,117,789

4,359

1.55

1,142,269

3,834

1.34

1,056,736

2,889

1.10

987,700

2,493

1.00

1,098,876

15,917

1.45

778,953

8,724

1.12

Tax-Exempt Investment Securities

(1)

2,827

2.36

2,939

2.30

2,488

1.73

2,409

1.60

3,380

2.07

2,668

2.03

3,772

2.39

Total Investment Securities

1,081,092

4,852

1.78

1,120,728

4,376

1.55

1,144,757

3,844

1.34

1,059,145

2,899

1.10

991,080

2,510

1.01

1,101,544

15,971

1.45

782,725

8,815

1.12

Federal Funds Sold and Interest Bearing

Deposits

469,352

4,463

3.77

569,984

3,231

2.25

691,925

1,408

0.82

873,097

409

0.19

789,100

300

0.15

649,762

9,511

1.46

790,870

998

0.13

Total Earning Assets

4,032,733

41,314

4.07

4,009,951

35,447

3.51

3,974,221

29,396

2.97

3,938,824

25,516

2.63

3,791,313

25,628

2.68

3,989,248

131,673

3.30

3,652,486

106,700

2.92

Cash and Due From Banks

74,178

79,527

79,730

74,253

73,752

76,929

72,409

Allowance for Credit Losses

(22,596)

(21,509)

(20,984)

(21,655)

(22,127)

(21,688)

(22,960)

Other Assets

297,510

289,709

288,421

275,353

284,999

287,813

282,129

Total Assets

4,381,825

4,357,678

4,321,388

4,266,775

4,127,937

4,332,302

3,984,064

LIABILITIES:

Interest Bearing Deposits

NOW Accounts

1,133,733

1,725

0.60

1,016,475

868

0.34

1,033,190

120

0.05

1,079,906

0.03

963,778

0.03

1,065,838

2,799

0.26

965,320

294

0.03

Money Market Accounts

273,328

0.09

288,758

0.10

286,210

0.05

285,406

0.05

289,335

0.05

283,407

203

0.07

278,606

134

0.05

Savings Accounts

641,153

0.05

643,640

0.05

628,472

0.05

599,359

0.05

573,563

0.05

628,313

309

0.05

537,023

263

0.05

Time Deposits

92,385

0.15

94,073

0.14

95,132

0.14

97,054

0.14

101,037

0.14

94,646

133

0.14

102,220

148

0.14

Total Interest Bearing Deposits

2,140,599

1,902

0.35

2,042,946

1,052

0.20

2,043,004

266

0.05

2,061,725

224

0.04

1,927,713

213

0.04

2,072,204

3,444

0.17

1,883,169

839

0.04

Short-Term Borrowings

50,844

690

5.38

46,679

536

4.56

31,782

343

4.33

32,353

192

2.40

46,355

307

2.63

40,483

1,761

4.35

53,511

1,360

2.54

Subordinated Notes Payable

52,887

522

3.86

52,887

443

3.28

52,887

370

2.76

52,887

317

2.40

52,887

306

2.26

52,887

1,652

3.08

52,887

1,228

2.29

Other Long-Term Borrowings

530

4.80

580

4.74

722

4.54

833

4.49

1,414

3.50

665

4.62

1,887

3.33

Total Interest Bearing Liabilities

2,244,860

3,122

0.55

2,143,092

2,037

0.38

2,128,395

987

0.19

2,147,798

742

0.14

2,028,369

838

0.16

2,166,239

6,888

0.32

1,991,454

3,490

0.18

Noninterest Bearing Deposits

1,662,443

1,726,918

1,722,325

1,652,337

1,621,432

1,691,132

1,523,717

Other Liabilities

84,585

98,501

87,207

72,166

114,657

85,684

111,567

Total Liabilities

3,991,888

3,968,511

3,937,927

3,872,301

3,764,458

3,943,055

3,626,738

Temporary Equity

9,367

9,862

10,096

10,518

13,339

9,957

20,505

SHAREOWNERS' EQUITY:

380,570

379,305

373,365

383,956

350,140

379,290

336,821

Total Liabilities, Temporary

Equity and

Shareowners' Equity

4,381,825

4,357,678

4,321,388

4,266,775

4,127,937

4,332,302

3,984,064

Interest Rate Spread

38,192

3.52

33,410

3.13

28,409

2.78

24,774

2.49

24,790

2.52

124,785

2.98

103,210

2.75

Interest Income and Rate Earned

(1)

41,314

4.07

35,447

3.51

29,396

2.97

25,516

2.63

25,628

2.68

131,673

3.30

106,700

2.92

Interest Expense and Rate Paid

(2)

3,122

0.31

2,037

0.20

987

0.10

742

0.08

838

0.09

6,888

0.17

3,490

0.10

Net Interest Margin

38,192

3.76

33,410

3.31

28,409

2.87

24,774

2.55

24,790

2.60

124,785

3.13

103,210

2.83

(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.