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 21, 2020

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 21, 2020, 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,

2020.

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 21, 2020.

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 21, 2020

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 21, 2020

exhibit991

Capital City Bank Group, Inc.

Reports Second Quarter 2020 Results

TALLAHASSEE,

Fla. (July 21, 2020) – Capital City Bank Group, Inc.

(NASDAQ: CCBG) today reported net income of $9.1

million, or $0.55 per diluted share for the second quarter of 20

20 compared to net income of $4.3 million, or $0.25 per diluted share

for the first quarter of 2020,

and $7.3 million, or $0.44 per diluted share for the second quarter

of 2019.

For the first six months of

2020,

net income totaled $13.4

million, or $0.80

per diluted share, compared to net income of $13.8 million, or

$0.82 per diluted

share, for the same period of 2019.

QUARTER HIGHLIGHTS

●

Return on assets improved to 1.10%

and efficiency ratio to 67%

●

Diversified revenue and strong

balance sheet continue to buffer impact of pandemic and

lower interest rates

●

Strong performance by Capital City Home

Loans (“CCHL”) contributed significantly ($0.20/share)

●

Pandemic related stimulus programs

contributed $190 million in loan growth

and deposit balances totaling $243 million

“Though the second quarter presented a challenging environment,

I am pleased with our financial performance and how we

responded to the COVID-19 pandemic,” said William

G. Smith, Jr., Chairman, President

and CEO. “We

issued $190 million in

Paycheck Protection Program (PPP) loans to assist our small

business clients and took critical precautions to protect the health and

welfare of our associates and clients as we reopened our offices

for routine lobby service. Despite a challenged economy,

the

mortgage market has been robust, and our recent alliance with

CCHL contributed $0.20 per share during the second quarter.

Earnings from CCHL and SBA/PPP fees helped mitigate the

adverse impacts of a lower interest rate environment and reserve

build

attributable to the adoption

of CECL and COVID-19. I anticipate the second half of 2020

will remain challenging but am hopeful it

will bring improvement. We

have taken a prudent and measured approach to managing through this ongoing

crisis and continue to

focus on our commitments to our associates, clients, communities,

and shareowners. I remain optimistic about the long-term

outlook

for Capital City and appreciate your continued support.”

COVID-19 Update

●

Lobby access has been re-opened for 56 of our 57

banking offices and operations are subject to

national guidelines and local

safety ordinances to protect both clients and associates – we will

continue to monitor changing conditions with the pandemic and

its impact on client and associate interactions within our banking offices

●

Most operational associates returned to work in early June, but

we have extended some remote work arrangements on a case-by-

case basis

●

Enhanced digital access options are available for banking products

and access to sales associates

●

Continue to monitor COVID-19 case count trends in our markets and respond

appropriately to help ensure client and associate

safety

●

Continued support of clients with the Small Business Administration

Payment Protection Program (“SBA PPP”) - we will

actively assist our clients with the forgiveness process

in coming quarters

●

We continued to assist

our clients and communities in the second quarter by processing a

total of 2,217 loan extensions ($330

million, or 16% of loan balances at June 30, 2020).

Discussion of Operating Results

Summary Overview

Compared to the first quarter of 2020,

the $11.1 million increase in operating profit was attributable

to a $14.7 million increase in

noninterest income (primarily mortgage banking revenues) and

a $3.0 million decrease in the provision for credit losses, partially

offset by higher noninterest expense of $6.3 million and

lower net interest income of $0.3

million.

Compared to the second quarter of 2019, the $6.6

million increase in operating profit was attributable to a $17.4 million increase

noninterest income, partially offset by a higher noninterest

expense of $8.9 million, a $1.4 million increase in the provision

for credit

losses and lower net interest income of $0.5

million.

The $3.4 million increase in operating profit for the first six months

of 2020 versus the comparable period of 2019 was attributable

to higher noninterest income of $20.4 million and net interest

income of $0.3 million, partially offset by a $5.6

million increase in

the provision for credit losses and higher noninterest expense

of $11.7 million.

The aforementioned period over period variances reflect the acquisition

of a 51% membership interest and consolidation of CCHL

late in the first quarter of 2020.

Our return on average assets (“ROA”) was 1.10%

and our return on average equity (“ROE”) was 11

.03%

for the second quarter of

2020.

These metrics were 0.57%

and 5.20%

for the first quarter of 2020, respectively,

and 0.98% and 9.37%

for the second quarter

of 2019, respectively.

For the first six months of 2020, our ROA was 0.85% and

our ROE was 8.12% compared to 0.92% and

8.94%, respectively, for

the same period of 2019.

Net Interest Income/Net Interest

Margin

Tax-equivalent net interest

income for the second quarter of 2020 was $25.6

million compared to $25.9 million for the first quarter

of 2020 and $26.1 million for the second quarter of 2019.

The decrease compared to both prior periods reflected lower rates

earned

on overnight funds, investment securities and variable rate loans, partially

offset by lower cost for our negotiated rate

deposits.

For

the first six months of 2020, tax-equivalent net interest income

totaled $51.4 million compared to $51.2 million in 2019.

The

increase was primarily due to loan growth and a reduction in

the cost of our negotiated rate deposits, partially offset

by lower rates

on our earning assets.

The federal funds target rate ended the second quarter

of 2020 in a range of 0.00%-0.25%, unchanged from the end of the

first

quarter of 2020.

However, since 150 basis points of rate cuts

were made late in the first quarter of 2020, we experienced lower

repricing of our variable/adjustable rate earning assets and investment

securities during the second quarter 2020.

We continue to

prudently manage our deposit mix and overall cost of funds, which

was 14 basis points for the second quarter of 2020 compared to

23 basis points for the first quarter of 2020.

Due to highly competitive fixed-rate loan pricing in our markets, we continue

to review

our loan pricing and make adjustments where we believe appropriate

and prudent.

Our net interest margin for the second quarter of 20

20 was 3.41%, a decrease of 37 basis points from the first quarter

of 2020 and 44

basis points from the second quarter of 2019.

For the first six months of 2020, the net interest margin decreased

21 basis points to

3.59%.

The decrease compared to all prior periods was attributable to

lower rates on our variable and adjustable rate earning assets,

partially offset by a lower cost of funds.

Our net interest margin for the second quarter of 2020

excluding the impact of SBA PPP

loans was 3.46%.

We discuss the effect

of the pandemic related stimulus programs on our balance

sheet in more detail below under

Discussion of Financial Condition

Provision for Credit Loss

The provision for credit losses for the second quarter of 2020

was $2.0 million compared to $5.0 million for the first quarter of 2020

and $0.6 million for the second quarter of 2019.

For the first six months of 2020, the provision was $7.0 million compared

to $1.4

million in 2019.

The higher provision in 2020 reflected expected losses due to

deterioration in economic conditions related to

COVID-19.

We discuss this exposure

further below.

Noninterest Income and Noninterest

Expense

CCHL’s

mortgage banking operations impacted our noninterest income

and noninterest expense for the three and six month periods

ended June 30, 2020, and thus, the period over period

comparisons reflect the impact of the CCHL consolidation, which occurred

late in the first quarter 2020.

The table below provides an overview of CCHL’s

impact on our noninterest income and noninterest

expense for 2020.

Noninterest income for the second quarter of 2020 totaled

$30.2 million compared to $15.5 million for the first quarter of 2020 and

$12.8 million for the second quarter of 2019.

The increase over both periods was driven by higher mortgage banking fees

and other

income (loan origination fees) at CCHL, partially offset

by lower deposit fees (overdraft fees).

Deposit fees decreased $1.3 million,

or 25.1% compared to the first quarter of 2020 and reflected slower consumer

spending and the impact of stimulus payments in the

second quarter related to the COVID-19 pandemic.

Noninterest

expense for the second quarter of 2020 totaled $37.3

million compared to $31.0 million for the first quarter of 2020 and

$28.4 million for the second quarter of 2019.

The increase over the first quarter of 2020 was attributable to higher compensation

expense of $4.2 million, occupancy expense of $0.8 million,

and other real estate (“ORE”) expense of $1.1 million.

The increase in

compensation and occupancy expense was primarily due to the

integration of CCHL late in the first quarter of 2020.

We also

realized approximately $0.8

million in expenses in the second quarter related to SBA PPP loan

origination activities and pandemic

related costs.

Approximately $0.3 million were one-time SBA PPP expenses and the remainder

are pandemic related and will phase

out over time.

The increase in ORE expense reflected a $1.0 million gain

on the sale of a banking office in the first quarter

of 2020.

For the first six months of 2020, noninterest expense totaled $68.3

million compared to $56.6 million for the same period of 2019

with the increase driven primarily by the same aforementioned

factors.

Overall, CCHL contributed significantly to the improvement

in our efficiency ratio for the second quarter of 2020

Three Months Ended

Six Months Ended

Jun 30, 2020

Mar 31, 2020

Jun 30, 2019

Jun 30, 2020

Jun 30, 2019

(Dollars in thousands)

Core

CCBG

CCHL

Core

CCBG

CCHL

Core

CCBG

CCHL

Core

CCBG

CCHL

Core

CCBG

CCHL

Deposit Fees

3,756

5,015

4,756

8,771

9,531

Bank Card Fees

3,142

3,051

3,036

6,193

5,891

Wealth Management Fees

2,554

2,604

2,404

5,158

4,727

Mortgage Banking Fees

241

17,573

1,138

1,892

1,199

1,379

19,465

2,192

Other

1,147

1,786

1,459

319

1,375

2,606

2,105

2,981

Total Noninterest Income

10,840

19,359

13,267

2,211

12,770

24,107

21,570

25,322

Salaries

11,596

8,381

13,488

2,242

12,496

25,085

10,623

24,781

Other Associate Benefits

3,477

204

3,957

3,941

7,433

253

8,005

Total Compensation

15,073

8,585

17,445

2,291

16,437

32,518

10,876

32,786

Occupancy, Net

5,030

768

4,748

231

4,537

9,778

999

9,046

Other

6,599

1,248

5,797

457

7,422

12,396

1,705

14,762

Total Noninterest Expense

26,702

10,601

27,990

2,979

28,396

54,692

13,580

56,594

Income Taxes

We realized

income tax expense of $2.9 million (effective rate of 18

%) for the second quarter of 2020 compared to $1.3 million

(effective rate of 24%) for the first quarter of 2020

and $2.4 million (effective rate of 25%) for the second

quarter of 2019.

For the

first six months of 2020, we realized income tax expense of $4.2

million (effective rate of 20%) compared to $4.4 million (effective

rate of 24%) for the same period of 2019.

The decrease in our effective tax rate for the three and

six month periods ended June 30,

2020 reflected the impact of converting CCHL to a partnership for

tax purposes in the second quarter of 2020.

Absent discrete

items, we expect our annual effective tax rate to approximate

19%-20%.

Discussion of Financial Condition

Earning Assets

Average earning assets were

$3.017 billion for the second quarter of 2020,

an increase of $264.9

million, or 9.6%

over the first

quarter of 2020,

and an increase of $322.1 million, or 12.0%

over the fourth quarter of 2019.

The increase over both prior periods

was primarily driven by higher deposit balances which funded

growth in the loan portfolio and overnight funds sold.

The impact of

pandemic related stimulus programs on our balance sheet in the

second quarter of 2020 is discussed in further detail below.

We maintained an average

net overnight funds (deposits with banks plus FED funds sold less

FED funds purchased) sold position of

$351.5 million during the second quarter of 2020

compared to an average net overnight funds sold position of $234.4

million in the

first quarter of 2020 and $228.1 million in the fourth quarter of

2019.

The increase compared to both prior periods was primarily

driven by pandemic related stimulus programs (see below –

Funding

Average loans held

for investment (“HFI”) increased $135.2 million, or 7.3

%, over the first quarter of 2020 and $148.9 million, or

8.1%, over the fourth quarter of 2019.

Period-end HFI loans increased $159.8, or 8.6%, over the first quarter

of 2020 and $186.2

million, or 10.1%, over the fourth quarter of 2019.

Demand from the SBA PPP was strong with SBA PPP loans (reflected

commercial loans) averaging $133.8 million in the second quarter

of 2020 and totaling $190 million at June 30, 2020.

In total, we

funded 2,208 loans for $193 million under the SBA PPP,

all from current balance sheet liquidity.

To date,

our borrowers have

submitted a nominal level of forgiveness applications, but

these applications are expected to accelerate in the second half

of the

year.

We received

100% of our SBA PPP loan fees totaling approximately $6.3

million (net) late in the second quarter.

Amortized

SBA PPP loan fees totaled approximately $0.4 million for the second

quarter of 2020.

Allowance for Credit Losses

At June 30, 2020, the allowance for credit losses totaled $2

2.5 million compared to $21.1 million at March 31, 2020 and $13.9

million at December 31, 2019.

At June 30, 2020, the allowance represented 1.11% of outstanding

loans held for investment (HFI)

and provided coverage of 322% of nonperforming loans compared

to 1.13%

and 433%, respectively, at March

31, 2020 and 0.75%

and 311%, respectively,

at December 31, 2019.

At June 30, 2020, excluding SBA PPP loans (100% government guaranteed)

the

allowance represented 1.23% of loans held for investment.

The adoption of ASC 326 (“CECL”) on January 1, 2020

had an impact of $4.0 million ($3.3 million increase in the allowance for

credit losses and $0.7 million increase in the allowance for unfunded

loan commitments (other liability account)).

The $5.7 million

build (provision of $7.0 million less net charge

-offs of $1.3 million) in the allowance for credit losses for

the first six months of

2020 reflected a higher forecasted rate of unemployment due

to stressed economic conditions related the COVID-19 pandemic.

Credit Quality/COVID-19 Exposure

Nonperforming assets (nonaccrual loans and OREO) totaled $8.0

million at June 30, 2020, a $1.7 million increase over March 31,

2020, and a $2.6 million increase over December 31, 2019.

Nonaccrual loans totaled $7.0 million at June 30, 2020,

a $2.1 million

increase over March 31, 2020 and a $2.5 million increase over

December 31, 2019.

The balance of OREO totaled $1.1

million at

June 30, 2020, a decrease of $0.4 million from March 31, 2020

and a $0.1 million increase over December 31, 2019.

We continue to analyze

our loan portfolio for segments that have been affected

by the stressed economic and business conditions

caused by the pandemic.

Certain at-risk segments total 8% of our loan balances at June 30,

2020, including hotel (3%),

restaurant

(1%),

retail and shopping centers (3%), and other (1%).

The other segment includes churches, non-profits, education, and

recreational.

To assist our clients, in mid-March

of 2020, we began allowing short term 60 to 90

day loan extensions for affected

borrowers.

A roll-forward of loan extension activity is provided in the table

below.

Approximately 83% of these loans were for

commercial borrowers and 17% for consumer borrowers.

% Loans Extended

At July 9, 2020

(Dollars in thousands)

Loans

Loan Amount

Loans

$ Loans

Loans Extended

2,217

330,406

Loans Resuming Payments

(1,708)

(234,610)

77%

71%

Loans Still on Extension

509

95,796

23%

29%

Still on Extension: From First Extension

382

60,237

17%

18%

Still on Extension: From Second Extension

127

35,559

11%

Funding (Deposits/Debt)

Average total deposits were

$2.783 billion for the second quarter of 2020, an increase of $230.8

million, or 9.0%

over the first

quarter of 2020,

and an increase of $258.5 million, or 10.2%

over the fourth quarter of 2019.

The estimated deposit inflows, related

to the two pandemic related stimulus programs,

were $179 million (SBA PPP) and $64 million (Economic Impact Payment

stimulus

checks).

Period end deposit balances grew $409 million and $310

million over the first quarter of 2020 and fourth quarter of 2019,

respectively, indicating strong

growth in core deposit balances.

Given these large increases, the potential exists for

our deposit

levels to be volatile over the coming quarters due to the uncertain

timing of the outflows of the stimulus related deposits and the

economic recovery.

It is anticipated that current liquidity levels will remain robu

st due to our strong overnight funds sold position,

in addition to cash flow generated from the investment portfolio.

We monitor deposit

rates on an ongoing basis and adjust if

necessary, as a prudent pricing

discipline remains the key to managing our mix of deposits.

Average borrowings

increased $39.9 million over the first quarter of 20

20 and $65.0 million over the fourth quarter of 2019

short-term borrowings (warehouse lines used to support HFS loans)

were added as part of the CCHL integration.

Capital

Shareowners’ equity was $335.1 million at June 30, 2020

compared to $328.5 million at March

31, 2020 and $327.0 million at

December 31, 2019.

For the first six months of 2020, shareowners’ equity was positively impacted

by net income of $13.4 million,

a $3.0 million increase in the unrealized gain on investment securities,

net adjustments totaling $0.7

million related to transactions

under our stock compensation

plans, and stock compensation accretion of $0.4

million.

Shareowners’ equity was reduced by

common stock dividends of $4.7 million ($0.28 per share),

a $3.1 million (net of tax) adjustment to retained earnings for

the

adoption of ASC 326 (“CECL”), and share repurchases of $1.6

million (76,952 shares).

At June 30, 2020, our total risk-based capital ratio was 17.81

compared to 17.19% at March 31, 2020 and 17.90% at December

31, 2019.

Our common equity tier 1 capital ratio was 14.21%, 13.55%, and 14.47%,

respectively, on these dates.

Our leverage ratio

was 10.24%, 10.81%, and 11.25%, 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 7.21%

at June

30, 2020 compared to 7.98% and 8.06%

at March 31, 2020 and December 31, 2019,

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

$3.5 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 and securities brokerage services.

Our bank subsidiary, Capital City

Bank, was founded in 1895 and now has 57 banking offices

and 85 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,

2019, 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 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, 2020

Mar 31, 2020

Dec 31, 2019

Sep 30, 2019

Jun 30, 2019

Shareowners' Equity (GAAP)

335,057

328,507

327,016

321,562

314,595

Less: Goodwill (GAAP)

89,095

89,275

84,811

Tangible Shareowners' Equity (non-GAAP)

245,962

239,232

242,205

236,751

229,784

Total Assets (GAAP)

3,499,524

3,086,523

3,088,953

2,934,513

3,017,654

Less: Goodwill (GAAP)

89,095

89,275

84,811

Tangible Assets (non-GAAP)

3,410,429

2,997,248

3,004,142

2,849,702

2,932,843

Tangible Common Equity Ratio (non-GAAP)

A/B

7.21%

7.98%

8.06%

8.31%

7.83%

Actual Diluted Shares Outstanding (GAAP)

16,821,743

16,845,462

16,855,161

16,797,241

16,773,449

Tangible Book Value

per Diluted Share (non-GAAP)

A/C

14.62

14.20

14.37

14.09

13.70

CAPITAL CITY BANK

GROUP,

INC.

EARNINGS HIGHLIGHTS

Unaudited

Three Months Ended

Six Months Ended

(Dollars in thousands, except per share data)

Jun 30, 2020

Mar 31, 2020

Jun 30, 2019

Jun 30, 2020

Jun 30, 2019

EARNINGS

Net Income Attributable to Common Shareowners

9,146

4,287

7,325

13,433

13,761

Diluted Net Income Per Share

0.55

0.25

0.44

0.80

0.82

PERFORMANCE

Return on Average Assets

1.10%

0.57%

0.98%

0.85%

0.92%

Return on Average Equity

11.03%

5.20%

9.37%

8.12%

8.94%

Net Interest Margin

3.41%

3.78%

3.85%

3.59%

3.80%

Noninterest Income as % of Operating Revenue

54.26%

37.52%

32.95%

47.13%

33.23%

Efficiency Ratio

66.90%

74.89%

73.02%

70.30%

74.00%

CAPITAL ADEQUACY

Tier 1 Capital

16.79%

16.12%

16.36%

16.79%

16.36%

Total Capital

17.81%

17.19%

17.13%

17.81%

17.13%

Leverage

10.24%

10.81%

10.64%

10.24%

10.64%

Common Equity Tier 1

14.21%

13.55%

13.67%

14.21%

13.67%

Tangible Common Equity

(1)

7.21%

7.98%

7.83%

7.21%

7.83%

Equity to Assets

9.57%

10.64%

10.43%

9.57%

10.43%

ASSET QUALITY

Allowance as % of Non-Performing Loans

322.37%

432.61%

259.55%

322.37%

259.55%

Allowance as a % of Loans

1.11%

1.13%

0.79%

1.11%

0.79%

Net Charge-Offs as % of Average Loans

0.05%

0.23%

0.04%

0.14%

0.12%

Nonperforming Assets as % of Loans and OREO

0.40%

0.34%

0.36%

0.40%

0.36%

Nonperforming Assets as % of Total Assets

0.23%

0.21%

0.22%

0.23%

0.22%

STOCK PERFORMANCE

High

23.99

30.62

25.00

30.62

25.87

Low

16.16

15.61

21.57

15.61

21.04

20.95

20.12

24.85

20.95

24.85

Average Daily Trading Volume

49,569

40,536

24,258

45,089

21,380

(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

2020

2019

(Dollars in thousands)

Second Quarter

First Quarter

Fourth Quarter

Third Quarter

Second Quarter

ASSETS

Cash and Due From Banks

75,155

72,676

60,087

61,151

53,731

Funds Sold and Interest Bearing Deposits

513,273

196,936

318,336

177,389

234,097

Total Cash and Cash Equivalents

588,428

269,612

378,423

238,540

287,828

Investment Securities Available for Sale

341,180

382,514

403,601

376,981

410,851

Investment Securities Held to Maturity

232,178

251,792

239,539

240,303

229,516

Total Investment Securities

573,358

634,306

643,140

617,284

640,367

Loans Held for Sale ("HFS")

76,610

82,598

9,509

13,075

9,885

Loans Held for Investment ("HFI")

Commercial, Financial, & Agricultural

421,270

249,020

255,365

259,870

265,001

Real Estate - Construction

117,794

122,595

115,018

111,358

101,372

Real Estate - Commercial

662,434

656,084

625,556

610,726

614,618

Real Estate - Residential

353,831

354,150

353,642

354,545

349,843

Real Estate - Home Equity

194,479

196,443

197,360

197,326

201,579

Consumer

266,417

275,982

279,565

277,970

288,196

Other Loans

4,883

6,580

7,808

14,248

13,131

Overdrafts

1,069

1,533

1,615

1,710

1,442

Total Loans Held for Investment

2,022,177

1,862,387

1,835,929

1,827,753

1,835,182

Allowance for Loan Losses

(22,457)

(21,083)

(13,905)

(14,319)

(14,593)

Loans Held for Investment, Net

1,999,720

1,841,304

1,822,024

1,813,434

1,820,589

Premises and Equipment, Net

87,972

87,684

84,543

85,810

86,005

Goodwill

89,095

89,275

84,811

Other Real Estate Owned

1,059

1,463

953

526

1,010

Other Assets

83,282

80,281

65,550

81,033

87,159

Total Other Assets

261,408

258,703

235,857

252,180

258,985

Total Assets

3,499,524

3,086,523

3,088,953

2,934,513

3,017,654

LIABILITIES

Deposits:

Noninterest Bearing Deposits

1,377,033

1,066,607

1,044,699

1,022,774

1,024,898

NOW Accounts

808,244

779,467

902,499

728,395

810,568

Money Market Accounts

240,754

210,124

217,839

239,410

240,181

Regular Savings Accounts

423,924

384,480

374,396

372,601

371,773

Certificates of Deposit

105,041

104,907

106,021

109,827

113,684

Total Deposits

2,954,996

2,545,585

2,645,454

2,473,007

2,561,104

Short-Term Borrowings

63,958

76,516

6,404

10,622

9,753

Subordinated Notes Payable

52,887

Other Long-Term Borrowings

5,583

5,896

6,514

6,963

7,313

Other Liabilities

75,702

70,044

50,678

69,472

72,002

Total Liabilities

3,153,126

2,750,928

2,761,937

2,612,951

2,703,059

Temporary Equity

11,341

7,088

SHAREOWNERS' EQUITY

Common Stock

168

167

Additional Paid-In Capital

31,575

32,100

32,092

31,075

30,751

Retained Earnings

328,570

321,772

322,937

316,551

310,247

Accumulated Other Comprehensive Loss, Net of Tax

(25,256)

(25,533)

(28,181)

(26,231)

(26,570)

Total Shareowners' Equity

335,057

328,507

327,016

321,562

314,595

Total Liabilities, Temporary Equity and Shareowners' Equity

3,499,524

3,086,523

3,088,953

2,934,513

3,017,654

OTHER BALANCE SHEET DATA

Earning Assets

3,185,418

2,776,228

2,806,913

2,635,501

2,719,530

Interest Bearing Liabilities

1,700,391

1,614,277

1,666,560

1,520,705

1,606,159

Book Value Per Diluted Share

19.92

19.50

19.40

19.14

18.76

Tangible Book Value

Per Diluted Share

(1)

14.62

14.20

14.37

14.09

13.70

Actual Basic Shares Outstanding

16,780

16,812

16,772

16,749

16,746

Actual Diluted Shares Outstanding

16,822

16,845

16,855

16,797

16,773

(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

Six Months Ended

2020

2019

Jun 30,

(Dollars in thousands, except per share data)

Second

Quarter

First

Quarter

Fourth

Quarter

Third

Quarter

Second

Quarter

2020

2019

INTEREST INCOME

Interest and Fees on Loans

23,687

23,593

23,842

23,992

23,765

47,280

46,381

Investment Securities

2,737

3,015

3,221

3,307

3,393

5,752

6,906

Funds Sold

757

945

1,142

1,507

845

3,100

Total Interest Income

26,512

27,365

28,008

28,441

28,665

53,877

56,387

INTEREST EXPENSE

Deposits

218

939

1,157

1,596

1,988

1,157

4,087

Short-Term Borrowings

421

132

553

Subordinated Notes Payable

374

471

525

558

596

845

1,204

Other Long-Term Borrowings

138

Total Interest Expense

1,054

1,592

1,754

2,244

2,681

2,646

5,495

Net Interest Income

25,458

25,773

26,254

26,197

25,984

51,231

50,892

Provision for Credit Losses

2,005

4,990

(162)

776

646

6,995

1,413

Net Interest Income after Provision for

Loan Losses

23,453

20,783

26,416

25,421

25,338

44,236

49,479

NONINTEREST INCOME

Deposit Fees

3,756

5,015

4,980

4,961

4,756

8,771

9,531

Bank Card Fees

3,142

3,051

3,131

2,972

3,036

6,193

5,891

Wealth Management Fees

2,554

2,604

2,761

2,992

2,404

5,158

4,727

Mortgage Banking Fees

17,814

3,030

1,542

1,587

1,199

20,844

2,192

Other

2,933

1,778

1,414

1,391

1,375

4,711

2,981

Total Noninterest Income

30,199

15,478

13,828

13,903

12,770

45,677

25,322

NONINTEREST EXPENSE

Compensation

23,658

19,736

17,363

16,203

16,437

43,394

32,786

Occupancy, Net

5,798

4,979

4,680

4,710

4,537

10,777

9,046

Other Real Estate, Net

116

(798)

102

(682)

438

Other

7,731

7,052

6,997

6,954

7,347

14,783

14,324

Total Noninterest Expense

37,303

30,969

29,142

27,873

28,396

68,272

56,594

OPERATING PROFIT

16,349

5,292

11,102

11,451

9,712

21,641

18,207

Income Tax Expense

2,950

1,282

2,537

2,970

2,387

4,232

4,446

Net Income

13,399

4,010

8,565

8,481

7,325

17,409

13,761

(Gain) Loss Attributable to Noncontrolling Interest

(4,253)

277

(3,976)

NET INCOME ATTRIBUTABLE

COMMON SHAREOWNERS

9,146

4,287

8,565

8,481

7,325

13,433

13,761

PER COMMON SHARE

Basic Net Income

0.55

0.25

0.51

0.44

0.80

0.82

Diluted Net Income

0.55

0.25

0.51

0.50

0.44

0.80

0.82

Cash Dividend

0.14

0.13

0.11

0.28

0.22

AVERAGE

Basic

16,797

16,808

16,750

16,747

16,791

16,803

16,791

Diluted

16,839

16,842

16,834

16,795

16,818

16,844

16,820

CAPITAL CITY BANK GROUP,

INC.

ALLOWANCE FOR CREDIT LOSSES

AND RISK ELEMENT ASSETS

Unaudited

Six Months Ended

2020

2019

Jun 30,

(Dollars in thousands, except per share data)

Second

Quarter

First

Quarter

Fourth

Quarter

Third

Quarter

Second

Quarter

2020

2019

ALLOWANCE FOR CREDIT LOSSES

Balance at Beginning of Period

21,083

13,905

14,319

14,593

14,120

13,905

14,210

Impact of Adopting ASC 326 (CECL)

3,269

Provision for Credit Losses - HFI

1,615

4,990

(162)

776

646

6,605

1,413

Net Charge-Offs

241

1,081

252

1,050

173

1,322

1,030

Balance at End of Period

(2)

22,457

21,083

13,905

14,319

14,593

22,457

15,623

As a % of Loans

1.11%

1.13%

0.75%

0.78%

0.79%

1.11%

0.79%

As a % of Nonperforming Loans

322.37%

432.61%

310.99%

290.55%

259.55%

322.37%

259.55%

CHARGE-OFFS

Commercial, Financial and Agricultural

186

362

149

289

235

548

330

Real Estate - Construction

223

Real Estate - Commercial

155

Real Estate - Residential

110

111

329

Real Estate - Home Equity

333

Consumer

634

864

819

744

520

1,498

1,315

Overdrafts

(3)

541

702

1,243

Total Charge-Offs

1,414

2,080

1,086

1,659

865

3,494

2,226

RECOVERIES

Commercial, Financial and Agricultural

127

114

132

Real Estate - Construction

Real Estate - Commercial

191

266

142

100

261

170

Real Estate - Residential

116

223

267

Real Estate - Home Equity

Consumer

365

268

300

277

251

633

535

Overdrafts

(3)

549

427

976

Total Recoveries

1,173

999

834

609

692

2,172

1,196

NET CHARGE-OFFS

241

1,081

252

1,050

173

1,322

1,030

Net Charge-Offs as a % of Average Loans

(1)

0.05%

0.23%

0.05%

0.23%

0.04%

0.14%

0.12%

RISK ELEMENT ASSETS

Nonaccruing Loans

6,966

4,874

4,472

4,928

5,622

Other Real Estate Owned

1,059

1,463

953

526

1,010

Total Nonperforming Assets ("NPAs")

8,025

6,337

5,425

5,454

6,632

Past Due Loans 30-89 Days

2,948

5,077

4,871

5,120

5,443

Past Due Loans 90 Days or More

Classified Loans

17,091

16,548

20,847

21,323

26,406

Performing Troubled Debt Restructuring's

15,133

15,934

16,888

18,284

18,737

Nonperforming Loans as a % of Loans

0.34%

0.26%

0.24%

0.27%

0.30%

NPAs as a % of Loans and Other Real Estate

0.40%

0.34%

0.29%

0.30%

0.36%

NPAs as a % of

Total Assets

0.23%

0.21%

0.18%

0.19%

0.22%

(1)

Annualized

(2)

Does not include $1.4 million for unfunded commitments recorded in other liabilities

(3)

Prior to the first quarter 2020, overdraft losses were reflected in

noninterest income (deposit fees)

CAPITAL CITY BANK GROUP,

INC.

AVERAGE

BALANCE AND INTEREST RATES

(1)

Unaudited

Second Quarter 2020

First Quarter 2020

Fourth Quarter 2019

Third Quarter 2019

Second Quarter 2019

Jun 2020 YTD

Jun 2019 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 HFI and HFS

2,057,925

23,785

4.65

1,882,703

23,692

5.06

1,846,190

23,958

5.15

1,837,548

24,113

5.21

1,823,311

23,873

5.25

1,970,551

47,477

4.85

1,801,977

46,591

5.21

Investment Securities

Taxable Investment Securities

601,509

2,708

1.80

629,512

2,995

1.91

610,046

3,186

2.08

607,363

3,249

2.13

614,775

3,301

2.15

615,511

5,703

1.86

616,442

6,688

2.18

Tax-Exempt Investment Securities

5,865

2.51

5,293

1.86

10,327

1.67

18,041

1.63

29,342

116

1.58

5,579

2.20

34,928

274

1.57

Total Investment Securities

607,374

2,745

1.81

634,805

3,020

1.91

620,373

3,229

2.08

625,404

3,322

2.12

644,117

3,417

2.12

621,090

5,765

1.86

651,370

6,962

2.14

Funds Sold

351,473

0.10

234,372

757

1.30

228,137

945

1.64

207,129

1,142

2.19

251,789

1,507

2.40

292,922

845

0.58

258,703

3,100

2.42

Total Earning Assets

3,016,772

26,618

3.55

2,751,880

27,469

4.01

2,694,700

28,132

4.14

2,670,081

28,577

4.25

2,719,217

28,797

4.25

2,884,563

54,087

3.77

2,712,050

56,653

4.21

Cash and Due From Banks

72,647

56,958

53,174

50,981

51,832

64,802

52,834

Allowance for Loan Losses

(21,642)

(14,389)

(14,759)

(14,863)

(14,513)

(18,015)

(14,431)

Other Assets

261,449

244,339

249,089

253,111

254,126

252,657

253,173

Total Assets

3,329,226

3,038,788

2,982,204

2,959,310

3,010,662

3,184,007

3,003,626

LIABILITIES:

Interest Bearing Deposits

NOW Accounts

789,378

0.04

808,811

725

0.36

755,625

889

0.47

749,678

1,235

0.65

832,982

1,623

0.78

799,094

803

0.20

858,488

3,378

0.79

Money Market Accounts

222,377

0.07

212,211

117

0.22

227,479

170

0.30

238,565

264

0.44

237,921

265

0.45

217,295

157

0.15

238,714

512

0.43

Savings Accounts

409,366

0.05

379,237

0.05

372,518

0.05

372,593

0.05

371,716

0.05

394,301

0.05

368,268

0.05

Time Deposits

104,718

0.19

105,542

0.19

108,407

0.19

111,447

0.18

115,442

0.19

105,130

101

0.19

117,131

107

0.18

Total Interest Bearing Deposits

1,525,839

218

0.06

1,505,801

939

0.25

1,464,029

1,157

0.31

1,472,283

1,596

0.43

1,558,061

1,988

0.51

1,515,820

1,157

0.15

1,582,601

4,087

0.52

Short-Term Borrowings

73,377

421

2.31

32,915

132

1.61

7,448

0.87

8,697

1.24

9,625

1.30

53,146

553

2.09

10,497

1.28

Subordinated Notes Payable

52,887

374

2.80

52,887

471

3.52

52,887

525

3.88

52,887

558

4.13

52,887

596

4.46

52,887

845

3.16

52,887

1,204

4.53

Other Long-Term Borrowings

5,766

2.84

6,312

3.21

6,723

3.33

7,158

3.47

7,509

3.53

6,039

3.03

7,853

138

3.54

Total Interest Bearing Liabilities

1,657,869

1,054

0.26

1,597,915

1,592

0.40

1,531,087

1,754

0.45

1,541,025

2,244

0.58

1,628,082

2,681

0.66

1,627,892

2,646

0.33

1,653,838

5,495

0.67

Noninterest Bearing Deposits

1,257,614

1,046,889

1,060,922

1,023,472

1,007,370

1,152,251

982,473

Other Liabilities

72,073

59,587

63,291

74,540

61,611

65,830

56,867

Total Liabilities

2,987,556

2,704,391

2,655,300

2,639,037

2,697,063

2,845,973

2,693,178

Temporary Equity

8,155

2,506.00

5,331

SHAREOWNERS' EQUITY:

333,515

331,891

326,904

320,273

313,599

332,703

310,448

Total Liabilities, Temporary

Equity and

Shareowners' Equity

3,329,226

3,038,788

2,982,204

2,959,310

3,010,662

3,184,007

3,003,626

Interest Rate Spread

25,564

3.30

25,877

3.61

26,378

3.69

26,333

3.67

26,116

3.59

51,441

3.44

51,158

3.54

Interest Income and Rate Earned

(1)

26,618

3.55

27,469

4.01

28,132

4.14

28,577

4.25

28,797

4.25

54,087

3.77

56,653

4.21

Interest Expense and Rate Paid

(2)

1,054

0.14

1,592

0.23

1,754

0.26

2,244

0.33

2,681

0.40

2,646

0.18

5,495

0.41

Net Interest Margin

25,564

3.41

25,877

3.78

26,378

3.89

26,333

3.92

26,116

3.85

51,441

3.59

51,158

3.80

(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.