Market Overview

Colony Bankcorp, Inc. Announces First Quarter Results


FITZGERALD, Ga., April 19, 2017 (GLOBE NEWSWIRE) -- Colony Bankcorp, Inc. (NASDAQ:CBAN), today reported net income available to shareholders of $1,906,000, or $0.22 per diluted share for the first quarter of 2017 compared to $1,656,000, or $0.20 per diluted share for the comparable 2016 period.  This increase of 15.10 percent in net income for the comparable three month period was primarily driven by an increase in noninterest income and a reduction in preferred stock dividends.  "We are pleased to report that we redeemed the remaining outstanding preferred stock of $9,360,000.  This will be immediately accretive to earnings per share as we will eliminate the current quarterly dividend payment of $210,600.  Also of significance during the quarter was total loan growth of $6.0 million and a reduction in substandard assets of $1.22 million," said Ed Loomis, President and Chief Executive Officer.  "In addition to this progress, our financial performance allowed the Company to reinstate a modest dividend payment of $0.025 per share payable to shareholders of record on March 1, 2017." 


Colony continues to maintain a strong regulatory capital position to be categorized as "well-capitalized" by regulatory benchmarks.  At March 31, 2017, the Company's tier one leverage ratio, tier one ratio, total risk-based capital ratio and common equity tier one capital ratio were 9.47 percent, 14.28 percent,15.39 percent and 11.34 percent, respectively, compared to 10.29 percent, 15.50 percent, 16.64 percent  and 11.32 percent, respectively, at December 31, 2016.  The Company's capital ratios were all in excess of regulatory minimums required to be classified as "well-capitalized."

Net Interest Margin 

During the first quarter of 2017, the Company reported net interest income of $9.46 million and a net interest margin of 3.35 percent compared to $9.46 million and 3.47 percent, respectively, for first quarter 2016.  The decline in net interest margin resulted from the Company having approximately $39 million more in average earning assets for the comparable periods.  These excess funds were primarily deployed into lower yielding overnight funds and bond investments.  While we have been in a historical low interest rate environment for some time, recent Federal Reserve discussion suggests a modest move toward a "tightening" interest rate policy in 2017.  The anticipated interest rate hikes along with shifting the lower yielding assets into higher yielding loans should improve the net interest margin.

Asset Quality

The Company continues to monitor our substandard and non-performing assets and focus on problem asset resolution.  Substandard assets that include non-performing assets totaled $32.00 million at March 31, 2017 compared to $33.23 million and $46.44 million, respectively, at December 31, 2016 and March 31, 2016.  Substandard assets adjusted for SBA guarantees to tier one capital plus loan loss reserve ratio was 25.18 percent, 25.67 percent and 34.60 percent, respectively, at March 31, 2017, December 31, 2016 and March 31, 2016.  Non-performing assets declined from the previous quarter end to $17.15 million or 2.24 percent of total loans and other real estate owned as of March 31, 2017.  This compares to $18.79 million or 2.47 percent and $21.73 million or 2.85 percent, respectively, as of December 31, 2016 and March 31, 2016.       

Other real estate ("OREO") totaled $5.90 million at March 31, 2017 compared to $6.44 million and $9.62 million, respectively, at December 31, 2016 and March 31, 2016.   Though these levels remain at an elevated level, we continue to work diligently to dispose these properties at fair value.  There are several contracts that we anticipate closing in the near future to further reduce our OREO holdings. 

In the first quarter of 2017 net charge-offs were $394 thousand, or 0.05 percent of average loans as compared to net charge-offs of ($591) thousand, or (0.08) percent of average loans in first quarter 2016.  The loan loss reserve was $8.86 million or 1.17 percent of total loans on March 31, 2017 compared to $8.92 million or 1.18 percent and $9.55 million or 1.27 percent, respectively, at December 31, 2016 and March 31, 2016.  Loan loss reserve methodology resulted in three months ended March 31, 2017 provision for loan losses of $335 thousand compared to $354 thousand for the comparable 2016 period.

Noninterest Income

Total noninterest income increased in the comparable periods as noninterest income for three months ended March 31, 2017 was $2.40 million compared to $2.17 million in the comparable 2016 period, or an increase of 10.50 percent.  Secondary mortgage fee income increased $86 thousand or 86.00 percent, service charges on deposits increased $53 thousand or 5.29 percent and debit card interchange fees increased $50 thousand or 8.42 percent to primarily account for the increase.    

Noninterest Expense

Total noninterest expense increased in the comparable periods as noninterest expense for three months ended March 31, 2017 was $8.41 million compared to $8.24 million for the comparable 2016 period, or an increase of 2.10 percent.  Salaries and employee benefit expenses increased 6.95 percent, occupancy expense was relatively flat and other noninterest expense decreased 4.79 percent for the comparable periods.  The efficiency ratio remained flat at 70.67 percent for three months ended March 31, 2017 compared to 70.65 percent for the comparable 2016 period.   The company continues to explore opportunities to improve its' operating efficiency.

Colony Bankcorp, Inc. is a bank holding company headquartered in Fitzgerald, Georgia that consists of one operating subsidiary, Colony Bank.  Colony Bank conducts a general full service commercial, consumer and mortgage banking business through twenty-six offices located in the central, southern and coastal Georgia cities of Albany, Ashburn, Broxton, Centerville, Columbus, Cordele, Douglas, Eastman,
Fitzgerald, Leesburg, Moultrie, Quitman, Rochelle, Savannah, Soperton, Statesboro, Sylvester, Thomaston, Tifton, Valdosta and Warner Robins, Georgia. 

Colony Bankcorp, Inc. Common Stock is quoted on the Nasdaq Global Market under the symbol "CBAN".

Certain statements contained in the preceding release that are not statements of historical fact constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 (the "Act"), notwithstanding that such statements are not specifically identified.  In addition, certain statements may be contained in the Company's future filings with the SEC, in press releases, and in oral and written statements made by or with the approval of the Company that are not statements of historical fact and constitute forward-looking statements within the meaning of the Act.  Examples of forward-looking statements include, but are not limited to: (i) projections of revenues, income or loss, earnings or loss per share, the payment or nonpayment of dividends, capital structure and other financial items; (ii) statement of plans and objectives of Colony Bankcorp, Inc. or its management or Board of Directors, including those relating to products or services; (iii) statements of future economic performance; and (iv) statements of assumptions underlying such statements.  Words such as "believes," "anticipates," "expects," "intends," "targeted" and similar expressions are intended to identify forward-looking statements but are not the exclusive means of identifying such statements.

Forward-looking statements involve risks and uncertainties that may cause actual results to differ materially from those in such statements.  Forward-looking statements speak only as of the date on which such statements are made.  The Company undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made, or to reflect the occurrence of unanticipated events.    Readers are cautioned not to place undue reliance on these forward-looking statements.

Consolidated Balance Sheets Colony Bankcorp, Inc.
(in thousands)
  March 31, 2017   December 31, 2016   March 31, 2016
  (unaudited)   (audited)   (unaudited)
Cash and Cash Equivalents          
Cash and Due from Banks $ 22,099     $ 28,822     $ 16,070  
Interest-Bearing Deposits   28,563       46,345       32,842  
Investment Securities                      
Available for Sale, at Fair Value   341,932       323,658       308,840  
Federal Home Loan Bank Stock, at Cost   3,043       3,010       2,755  
Loans   760,341       754,283       754,261  
Allowance for Loan Losses   (8,864 )     (8,923 )     (9,549 )
Unearned Interest and Fees   (421 )     (361 )     (356 )
    751,056       744,999       744,356  
Premises and Equipment   27,812       27,969       27,019  
Other Real Estate   5,899       6,439       9,618  
Other Intangible Assets   72       81       107  
Other Assets   28,289       29,119       26,782  
Total Assets $ 1,208,765     $ 1,210,442     $ 1,168,389  
Noninterest-Bearing $ 158,587     $ 159,059     $ 135,351  
Interest-Bearing   885,644       885,298       864,692  
    1,044,231       1,044,357  
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