Colony Bankcorp Reports Third Quarter 2023 Results

Rhea-AI Summary

Colony Bankcorp, Inc. (CBAN) reports Q3 2023 financial results with net income of $5.8 million, an increase from the previous quarter. The company declares a quarterly cash dividend of $0.11 per share.

Positive

• Net income increased to $5.8 million, or $0.33 per diluted share, for Q3 2023, compared to $5.3 million for Q2 2023.
• Operating net income increased to $6.0 million, or $0.34 of adjusted earnings per diluted share, for Q3 2023, compared to $5.7 million for Q2 2023.
• Strong liquidity with available sources of funding of approximately $1.4 billion at September 30, 2023.
• Total loans increased by $26.1 million, or 1.42%, from the previous quarter.
• The company declared a quarterly cash dividend of $0.11 per share, to be paid on November 22, 2023, to shareholders of record as of November 8, 2023.

Negative

• Total deposits decreased by $35.9 million from June 30, 2023, to September 30, 2023.
• Mortgage production and sales decreased in Q3 2023 compared to Q2 2023.
• Noninterest income decreased by $1.0 million for the nine months ended September 30, 2023, compared to the same period in 2022.
• Noninterest expense decreased to $20.9 million for Q3 2023, compared to $21.4 million for the same period in 2022.

Declares Quarterly Cash Dividend of $0.11 Per Share

FITZGERALD, Ga.--(BUSINESS WIRE)-- Colony Bankcorp, Inc. (Nasdaq: CBAN) (“Colony” or the “Company”) today reported financial results for the third quarter of 2023. Financial highlights are shown below.

Financial Highlights:

• Net income increased to $5.8 million, or $0.33 per diluted share, for the third quarter of 2023, compared to $5.3 million, or $0.30 per diluted share, for the second quarter of 2023, and $5.3 million, or $0.30 per diluted share, for the third quarter of 2022.
• Operating net income increased to $6.0 million, or $0.34 of adjusted earnings per diluted share, for the third quarter of 2023, compared to $5.7 million, or $0.33 of adjusted earnings per diluted share, for the second quarter of 2023, and $5.3 million, or $0.30 of adjusted earnings per diluted share, for the third quarter of 2022. (See Reconciliation of Non-GAAP Measures).
• Strong liquidity with available sources of funding of approximately $1.4 billion at September 30, 2023. No overnight borrowings utilized or Federal Reserve Bank Term Funding program used as of September 30, 2023.
• Estimated uninsured deposits of $740.0 million, or 28.21% of total Bank deposits at September 30, 2023. Adjusted uninsured deposit estimate (excluding deposits collateralized by public funds or internal accounts) of $451.9 million, or 17.22% of total Bank deposits at September 30, 2023.
• Provision for credit losses of $1.0 million was recorded in third quarter of 2023 compared to $200,000 in second quarter of 2023, and $1.3 million in third quarter of 2022.
• Total loans were $1.86 billion at September 30, 2023, an increase of $26.1 million, or 1.42%, from the prior quarter.
• Total deposits were $2.59 billion and $2.63 billion at September 30, 2023 and June 30, 2023, respectively, a decrease of $35.9 million.
• Mortgage production was $78.4 million, and mortgage sales totaled $53.3 million in the third quarter of 2023 compared to $106.4 million and $66.4 million, respectively, for the second quarter of 2023.
• Small Business Specialty Lending (“SBSL”) closed $34.5 million in Small Business Administration (“SBA”) loans and sold $14.6 million in SBA loans in the third quarter of 2023 compared to $26.0 million and $11.1 million, respectively, for the second quarter of 2023.

The Company also announced that on October 25, 2023, the Board of Directors declared a quarterly cash dividend of $0.11 per share, to be paid on its common stock on November 22, 2023, to shareholders of record as of the close of business on November 8, 2023. The Company had 17,567,983 shares of its common stock outstanding as of October 24, 2023.

“We continue to be pleased with our performance in the current environment. Our quarter over quarter earnings improved as we remain focused on enhancing our operational efficiency, even in the face of persistent industry-wide challenges. Noninterest expenses decreased as we diligently maintained our disciplined approach to expense control and saw the results of our previous quarter's efforts come to fruition.

"In light of the evolving economic landscape, we anticipate a more conservative approach to loan growth in the coming quarters. This outlook aligns with our commitment to prudent risk management and achieving appropriate returns with the current increased cost of funds. We prioritize the long-term financial health of our institution and the well-being of our customers as we navigate these market conditions,” said Heath Fountain, Chief Executive Officer and Acting Chief Financial Officer.

“Total deposits declined slightly from the previous quarter resulting from the seasonality of a small portion of our deposit base, however, we have seen total deposits increase on a year-to-date basis. Additionally, net-interest margin increased 1 basis point from the prior quarter, but we maintain our outlook of flat to slightly down over the next quarter as we continue to see mix and rate changes along with competition on deposit pricing.

“Asset quality remains strong as non-performing loans decreased from the previous quarter and non-performing loans in our commercial real estate portfolio continue to remain at low levels. The uptick in loan charge-offs pertains to the non-government guaranteed portion of a limited number of loans within our Small Business Specialty Lending Division.”

Balance Sheet

• Total assets were $3.09 billion at September 30, 2023, a decrease of $7.2 million from June 30, 2023.
• Total loans, including loans held for sale, were at $1.89 billion at September 30, 2023, an increase of $25.1 million from the quarter ended June 30, 2023.
• Total deposits were $2.59 billion and $2.63 billion at September 30, 2023 and June 30, 2023, respectively, a decrease of $35.9 million. Interest bearing demand deposits increased $7.0 million and savings and money market deposits increased $22.1 million, which was partially offset by a decrease in time deposits of $18.0 million from June 30, 2023 to September 30, 2023.
• Total borrowings at September 30, 2023 totaled $248.4 million, an increase of $30.0 million or, 13.7%, compared to June 30, 2023 related to increases in Federal Home Loan Bank advances.

Capital

• Colony continues to maintain a strong capital position, with ratios that exceed regulatory minimums required to be considered as “well-capitalized.”
• Preliminary tier one leverage ratio, tier one capital ratio, total risk-based capital ratio and common equity tier one capital ratio were 8.93%, 12.46%, 15.11%, and 11.36%, respectively, at September 30, 2023.

Third Quarter and September 30, 2023 Year to Date Results of Operations

• Net interest income, on a tax-equivalent basis, totaled $19.8 million for the third quarter ended September 30, 2023 compared to $21.0 million for the same period in 2022. Net interest income, on a tax-equivalent basis, for the nine months ended September 30, 2023 totaled $59.9 million, compared to $59.6 million for the nine months ended September 30, 2022. Quarter over quarter there was a decrease of $1.2 million and only a slight increase in year to date comparisons. Increases can be seen in both income on interest earning assets offset by expenses on interest bearing liabilities due to the significant rise in interest rates period over period along with increases in FHLB advances. Income on interest earning assets increased $8.9 million, to $32.8 million for the third quarter of 2023 and $26.8 million, to $92.3 million for the nine month period ended September 30, 2023, each compared to the respective period in 2022. Expense on interest bearing liabilities increased $10.1 million, to $13.0 million for the third quarter of 2023 and $26.5 million, to $32.3 million for the nine month period ended September 30, 2023, each compared to the respective period in 2022.
• Net interest margin for the third quarter of 2023 was 2.78% compared to 3.26% for the third quarter of 2022. Net interest margin was 2.87% for the nine months ended September 30, 2023 compared to 3.19% for the nine months ended September 30, 2022. The decrease for each period is the result of rate increases in interest earning liabilities outpacing the rate increases in interest bearing assets.
• Noninterest income totaled $9.7 million for the third quarter ended September 30, 2023, an increase of $1.6 million, or 19.30%, compared to the same period in 2022. This increase was related to increases in insurance commissions, equity investment income and income on wealth advisory services which are included in other noninterest income. Noninterest income totaled $26.3 million for the nine months ended September 30, 2023, a decrease of $1.0 million, or 3.68%, compared to the same period in 2022. This decrease was primarily attributable to decreases in mortgage fee income and SBSL loan sales offset by increases in insurance commissions, equity investment income and income on wealth advisory services which are included in other noninterest income.
• Noninterest expense totaled $20.9 million for the third quarter ended September 30, 2023, compared to $21.4 million for the same period in 2022. Noninterest expense totaled $63.5 million for the nine months ended September 30, 2023, compared to $67.6 million for the same period in 2022. These decreases were a result of overall decreases in salaries and employee benefits related to lower commissions and bonus expenses as well as a decreases in data processing expense as a result of cost savings upon renewal of the core processing contract partially offset by an increase in other loan related fees.

Asset Quality

• Nonperforming assets totaled $10.1 million and $11.9 million at September 30, 2023 and June 30, 2023, respectively, a decrease of $1.8 million due to charge offs and paid off loans during the quarter.
• Other real estate owned and repossessed assets totaled $812,000 at September 30, 2023 and $792,000 at June 30, 2023.
• Net loans charged-off were $898,000, or 0.19% of average loans for the third quarter of 2023, compared to net charge-offs of $200,000 or 0.04% for the second quarter of 2023.
• The credit loss reserve was $17.4 million, or 0.93% of total loans, at September 30, 2023, compared to $17.1 million, or 0.93% of total loans at June 30, 2023.

Earnings call information

The Company will host an earnings conference call at 9:00 a.m. ET on Thursday, October 26, 2023, to discuss the recent results and answer appropriate questions. The conference call can be accessed by dialing 1-888-259-6580 (or 1-416-764-8624 for international participants). The conference call access code is 97884160. A replay of the call will be available until Thursday, November 2, 2023. To listen to the replay, dial 1-877-674-7070 and enter the access code 884160#.

About Colony Bankcorp

Colony Bankcorp, Inc. is the bank holding company for Colony Bank. Founded in 1975 and headquartered in Fitzgerald, Georgia, Colony operates 38 locations throughout Georgia and is now serving Alabama. At Colony Bank, we offer a range of banking solutions for personal and business customers. In addition to traditional banking services, Colony provides specialized solutions including mortgage, government guaranteed lending, consumer insurance, wealth management and merchant services. Colony’s common stock is traded on the NASDAQ Global Market under the symbol “CBAN.” For more information, please visit www.colony.bank. You can also follow the Company on social media.

Forward-Looking Statements

Certain statements contained in this press release that are not statements of historical fact constitute “forward-looking statements” within the meaning of, and subject to the protections of, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. In addition, certain statements may be contained in the Company’s future filings with the SEC, in press releases, and in oral and written statements made by or with the approval of the Company that are not statements of historical fact and constitute “forward-looking statements” within the meaning of, and subject to the protections of, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Examples of forward-looking statements include, but are not limited to: (i) projections and/or expectations of revenues, income or loss, earnings or loss per share, the payment or nonpayment of dividends, capital structure and other financial items; (ii) statement of plans and objectives of Colony Bankcorp, Inc. or its management or Board of Directors, including those relating to products or services; (iii) statements of future economic performance; (iv) statements regarding growth strategy, capital management, liquidity and funding, and future profitability; and (v) statements of assumptions underlying such statements. Words such as “believes,” “anticipates,” “expects,” “intends,” “targeted” and similar expressions are intended to identify forward-looking statements but are not the exclusive means of identifying such statements.

Prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve known and unknown risks and uncertainties. Factors that might cause such differences include, but are not limited to: the impact of current and economic conditions, particularly those affecting the financial services industry, including the effects of declines in the real estate market, high unemployment rates, inflationary pressures, elevated interest rates and slowdowns in economic growth, as well as the financial stress on borrowers as a result of the foregoing; potential impacts of adverse developments in the banking industry highlighted by high-profile bank failures, including impacts on customer confidence, deposit outflows, liquidity and the regulatory response thereto; risks arising from media coverage of the banking industry; risks arising from perceived instability in the banking sector; the risks of changes in interest rates and their effects on the level, cost, and composition of, and competition for, deposits, loan demand and timing of payments, the values of loan collateral, securities, and interest sensitive assets and liabilities; the ability to attract new or retain existing deposits, to retain or grow loans or additional interest and fee income, or to control noninterest expense; the effect of pricing pressures on the Company’s net interest margin; the failure of assumptions underlying the establishment of reserves for possible credit losses, fair value for loans and other real estate owned; changes in real estate values; the Company’s ability to implement its various strategic and growth initiatives; increased competition in the financial services industry, particularly from regional and national institutions, as well as from fintech companies; economic conditions, either nationally or locally, in areas in which the Company conducts operations being less favorable than expected; changes in the prices, values and sales volumes of residential and commercial real estate; developments in our mortgage banking business, including loan modifications, general demand, and the effects of judicial or regulatory requirements or guidance; legislation or regulatory changes which adversely affect the ability of the consolidated Company to conduct business combinations or new operations; adverse results from current or future litigation, regulatory examinations or other legal and/or regulatory actions, including as a result of the Company’s participation in and execution of government programs; potential impact of the phase-out of the London Interbank Offered Rate (“LIBOR”) or other changes involving LIBOR; significant turbulence or a disruption in the capital or financial markets and the effect of a fall in the stock market prices on our investment securities; the effects of war or other conflicts including the impacts related to or resulting from Russia’s military action in Ukraine or the conflict in Israel and surrounding areas; risks related to the Company’s recently completed acquisitions, including that the anticipated benefits from the recently completed acquisitions are not realized in the time frame anticipated or at all as a result of changes in general economic and market conditions or other unexpected factors or events; the risks associated with the Company’s pursuit of future acquisitions; the impact of generative artificial intelligence; fraud or misconduct by internal or external actors, and system failures, cybersecurity threats or security breaches and the cost of defending against them; and general competitive, economic, political and market conditions or other unexpected factors or events. These and other factors, risks and uncertainties could cause the actual results, performance or achievements of the Company to be materially different from the future results, performance or achievements expressed or implied by such forward-looking statements. Many of these factors are beyond the Company’s ability to control or predict.

Forward-looking statements speak only as of the date on which such statements are made. These forward-looking statements are based upon information presently known to the Company’s management and are inherently subjective, uncertain and subject to change due to any number of risks and uncertainties, including, without limitation, the risks and other factors set forth in the Company’s filings with the Securities and Exchange Commission, the Company’s Annual Report on Form 10-K for the year ended December 31, 2022, under the captions “Cautionary Note Regarding Forward-Looking Statements” and “Risk Factors,” and in the Company’s quarterly reports on Form 10-Q and current reports on Form 8-K. The Company undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made, or to reflect the occurrence of unanticipated events. Readers are cautioned not to place undue reliance on these forward-looking statements.

Explanation of Certain Unaudited Non-GAAP Financial Measures

The measures entitled operating noninterest income, operating noninterest expense, operating net income, adjusted earnings per diluted share, tangible book value per common share, tangible equity to tangible assets, operating efficiency ratio, operating net noninterest expense to average assets and pre-provision net revenue are not measures recognized under U.S. generally accepted accounting principles (GAAP) and therefore are considered non-GAAP financial measures. The most comparable GAAP measures are noninterest income, noninterest expense, net income, diluted earnings per share, book value per common share, total equity to total assets, efficiency ratio, net noninterest expense to average assets and net interest income before provision for credit losses, respectively. Operating noninterest income excludes gain on sale of bank premises. Operating noninterest expense excludes acquisition-related expenses and severance costs. Operating net income and operating efficiency ratio both exclude acquisition-related expenses, severance costs and FHLB mark from called borrowings from net income and efficiency ratio, respectively. Operating net noninterest expense to average assets ratio excludes from net noninterest expense, severance costs, acquisition-related expenses and gain on sale of bank premises. Acquisition-related expenses includes fees associated with acquisitions and vendor contract buyouts. Severance costs includes costs associated with termination and retirement of employees. Adjusted earnings per diluted share includes the adjustments to operating net income. Tangible book value per common share and tangible equity to tangible assets exclude goodwill and other intangibles from book value per common share and total equity to total assets, respectively. Pre-provision net revenue is calculated by adding noninterest income to net interest income before provision for credit losses, and subtracting noninterest expense.

Management uses these non-GAAP financial measures in its analysis of the Company's performance and believes these presentations provide useful supplemental information, and a clearer understanding of the Company's performance, and if not provided would be requested by the investor community. The Company believes the non-GAAP measures enhance investors' understanding of the Company's business and performance. These measures are also useful in understanding performance trends and facilitate comparisons with the performance of other financial institutions. The limitations associated with operating measures are the risk that persons might disagree as to the appropriateness of items comprising these measures and that different companies might calculate these measures differently.

These disclosures should not be considered an alternative to GAAP. The computations of operating noninterest income, operating noninterest expense, operating net income, adjusted earnings per diluted share, tangible book value per common share, tangible equity to tangible assets, operating efficiency ratio, operating net noninterest expense to average assets and pre-provision net revenue and the reconciliation of these measures to noninterest income, noninterest expense, net income, diluted earnings per share, book value per common share, total equity to total assets, efficiency ratio, net noninterest expense to average assets and net interest income before provision for credit losses are set forth in the table below.

Colony Bankcorp, Inc.
Reconciliation of Non-GAAP Measures
		2023												2022
(dollars in thousands, except per share data)		Third Quarter				Second Quarter				First Quarter				Fourth Quarter				Third Quarter
Operating noninterest income reconciliation
Noninterest income (GAAP)		$	9,718			$	8,952			$	7,659			$	7,688			$	8,145
Gain on sale of bank premises			—				(125	)			—				—				—
Operating noninterest income		$	9,718			$	8,827			$	7,659			$	7,688			$	8,145
Operating noninterest expense reconciliation
Noninterest expense (GAAP)		$	20,881			$	21,432			$	21,165			$	21,826			$	21,367
Severance costs			(220	)			(635	)			(431	)			—				—
Acquisition-related expenses			—				—				(161	)			—				(2	)
Operating noninterest expense		$	20,661			$	20,797			$	20,573			$	21,826			$	21,365
Operating net income reconciliation
Net income (GAAP)		$	5,804			$	5,302			$	5,043			$	5,551			$	5,252
Severance costs			220				635				431				—				—
Acquisition-related expenses			—				—				161				—				2
Gain on sale of bank premises			—				(125	)			—				—				—
Income tax benefit			(48	)			(93	)			(107	)			—				—
Operating net income		$	5,976			$	5,719			$	5,528			$	5,551			$	5,254
Weighted average diluted shares			17,569,493				17,580,557				17,595,688				17,630,971				17,645,119
Adjusted earnings per diluted share		$	0.34			$	0.33			$	0.31			$	0.31			$	0.30
Tangible book value per common share reconciliation
Book value per common share (GAAP)		$	13.59			$	13.65			$	13.57			$	13.08			$	12.81
Effect of goodwill and other intangibles			(3.04	)			(3.07	)			(3.08	)			(3.10	)			(3.12	)
Tangible book value per common share		$	10.55			$	10.58			$	10.49			$	9.98			$	9.69
Tangible equity to tangible assets reconciliation
Equity to assets (GAAP)			7.72	%			7.72	%			7.97	%			7.84	%			8.06	%
Effect of goodwill and other intangibles			(1.63	)			(1.63	)			(1.70	)			(1.74	)			(1.84	)
Tangible equity to tangible assets			6.09	%			6.09	%			6.27	%			6.10	%			6.22	%
Operating efficiency ratio calculation
Efficiency ratio (GAAP)			71.17	%			76.18	%			74.98	%			75.03	%			73.57	%
Severance costs			(0.75	)			(2.26	)			(1.53	)			—				—
Acquisition-related expenses			—				—				(0.57	)			—				(0.01	)
Gain on sale of bank premises			—				0.44				—				—				—
Operating efficiency ratio			70.42	%			74.36	%			72.88	%			75.03	%			73.56	%
Operating net noninterest expense(1) to average assets calculation
Net noninterest expense to average assets			1.45	%			1.65	%			1.86	%			1.96	%			1.89	%
Severance Costs			(0.03	)			(0.09	)			(0.06	)			—				—
Acquisition-related expenses			—				—				(0.02	)			—				—
Gain on Sale of bank premises			—				0.02				—				—				—
Operating net noninterest expense to average assets			1.42	%			1.58	%			1.78	%			1.96	%			1.89	%
Pre-provision net revenue
Net interest income before provision for credit losses		$	19,621			$	19,181			$	20,568			$	21,400			$	20,898
Noninterest income			9,718				8,952				7,659				7,688				8,146
Total income			29,339				28,133				28,227				29,088				29,044
Noninterest expense			20,881				21,432				21,165				21,826				21,367
Pre-provision net revenue		$	8,458			$	6,701			$	7,062			$	7,262			$	7,677
(1) Net noninterest expense is defined as noninterest expense less noninterest income

Colony Bankcorp, Inc.
Selected Financial Information
		2023												2022
(dollars in thousands, except per share data)		Third Quarter				Second Quarter				First Quarter				Fourth Quarter				Third Quarter
EARNINGS SUMMARY
Net interest income		$	19,621			$	19,181			$	20,568			$	21,400			$	20,898
Provision for credit losses			1,000				200				900				900				1,320
Noninterest income			9,718				8,952				7,659				7,688				8,146
Noninterest expense			20,881				21,432				21,165				21,826				21,367
Income taxes			1,654				1,199				1,119				811				1,105
Net income		$	5,804			$	5,302			$	5,043			$	5,551			$	5,252
PERFORMANCE MEASURES
Per common share:
Common shares outstanding			17,567,983				17,541,661				17,593,879				17,598,123				17,641,123
Weighted average basic shares			17,569,493				17,580,557				17,595,688				17,630,971				17,645,119
Weighted average diluted shares			17,569,493				17,580,557				17,595,688				17,630,971				17,645,119
Earnings per basic share		$	0.33			$	0.30			$	0.29			$	0.31			$	0.30
Earnings per diluted share			0.33				0.30				0.29				0.31				0.30
Adjusted earnings per diluted share(b)			0.34				0.33				0.31				0.31				0.30
Cash dividends declared per share			0.11				0.11				0.11				0.1075				0.1075
Common book value per share			13.59				13.65				13.57				13.08				12.81
Tangible book value per common share(b)			10.55				10.58				10.49				9.98				9.69
Pre-provision net revenue(b)		$	8,458			$	6,701			$	7,062			$	7,262			$	7,677
Performance ratios:
Net interest margin (a)			2.78	%			2.77	%			3.08	%			3.23	%			3.25	%
Return on average assets			0.75				0.70				0.69				0.77				0.75
Return on average total equity			9.61				8.88				8.73				9.76				8.85
Efficiency ratio			71.17				76.18				74.98				75.03				73.57
Operating efficiency ratio (b)			70.42				74.36				72.88				75.03				73.56
Net noninterest expense to average assets			1.45				1.65				1.86				1.96				1.89
Operating net noninterest expense to average assets(b)			1.42				1.58				1.78				1.96				1.89
ASSET QUALITY
Nonperforming portfolio loans		$	5,625			$	6,716			$	5,636			$	5,693			$	5,292
Nonperforming government guaranteed loans			3,641				4,369				1,529				17				10
Total nonperforming loans (NPLs)			9,266				11,085				7,165				5,710				5,302
Other real estate owned			812				792				651				651				246
Total nonperforming assets (NPAs)			10,078				11,877				7,816				6,361				5,548
Classified loans			20,704				19,267				18,747				15,105				18,310
Criticized loans			50,741				48,074				43,281				41,293				43,933
Net loan charge-offs			898				200				237				154				198
Allowance for credit losses to total loans			0.93	%			0.93	%			0.92	%			0.93	%			0.96	%
Allowance for credit losses to total NPLs			187.44				153.96				231.67				282.45				286.34
Allowance for credit losses to total NPAs			172.34				143.69				212.37				253.55				273.65
Net charge-offs to average loans			0.19				0.04				0.05				0.04				0.05
NPLs to total loans			0.50				0.60				0.40				0.33				0.33
NPAs to total assets			0.33				0.38				0.26				0.22				0.20
NPAs to total loans and foreclosed assets			0.54				0.65				0.43				0.37				0.35
AVERAGE BALANCES
Total assets		$	3,058,485			$	3,030,044			$	2,949,986			$	2,863,046			$	2,777,390
Loans, net			1,854,367				1,814,172				1,765,845				1,637,034				1,509,202
Loans, held for sale			29,444				21,237				14,007				22,644				30,238
Deposits			2,565,026				2,524,949				2,473,464				2,460,664				2,366,710
Total stockholders’ equity			239,571				239,579				234,147				225,639				235,557
(a) Computed using fully taxable-equivalent net income.
(b) Non-GAAP measure - see “Explanation of Certain Unaudited Non-GAAP Financial Measures” for more information and reconciliation to GAAP.

Colony Bankcorp, Inc.
Average Balance Sheet and Net Interest Analysis
	Three Months Ended September 30,
	2023									2022
(dollars in thousands)	Average Balances			Income/ Expense			Yields/ Rates			Average Balances			Income/ Expense			Yields/ Rates
Assets
Interest-earning assets:
Loans, net of unearned income 1	$	1,883,811		$	26,075		5.49	%		$	1,553,882		$	18,216		4.65	%
Investment securities, taxable		761,540			5,288		2.75	%			818,362			4,711		2.28	%
Investment securities, tax-exempt 2		106,136			610		2.28	%			115,368			638		2.19	%
Deposits in banks and short term investments		78,295			787		3.99	%			70,455			278		1.56	%
Total interest-earning assets		2,829,782			32,760		4.59	%			2,558,067			23,843		3.70	%
Noninterest-earning assets		228,702									219,323
Total assets	$	3,058,485								$	2,777,390
Liabilities and stockholders' equity
Interest-bearing liabilities:
Interest-earning demand and savings	$	1,382,638		$	4,455		1.28	%		$	1,424,171		$	772		0.21	%
Other time		672,442			5,883		3.47	%			370,282			677		0.72	%
Total interest-bearing deposits		2,055,080			10,338		2.00	%			1,794,453			1,449		0.32	%
Federal funds purchased		764			11		5.93	%			541			3		2.20	%
Federal Home Loan Bank advances		155,652			1,569		4.00	%			96,848			555		2.27	%
Other borrowings		66,342			1,041		6.22	%			65,741			822		4.96	%
Total other interest-bearing liabilities		222,758			2,621		4.67	%			163,130			1,380		3.36	%
Total interest-bearing liabilities		2,277,838			12,959		2.26	%			1,957,583			2,829		0.57	%
Noninterest-bearing liabilities:
Demand deposits		509,946								$	572,257
Other liabilities		31,130									11,993
Stockholders' equity		239,571									235,557
Total noninterest-bearing liabilities and stockholders' equity		780,647									819,807
Total liabilities and stockholders' equity	$	3,058,485								$	2,777,390
Interest rate spread							2.34	%								3.13	%
Net interest income				$	19,801								$	21,014
Net interest margin							2.78	%								3.26	%
________________________________________
1The average balance of loans includes the average balance of nonaccrual loans. Income on such loans is recognized and recorded on the cash basis. Taxable-equivalent adjustments totaling $54,000 and $33,000 for the quarters ended September 30, 2023 and 2022, respectively, are calculated using the statutory federal tax rate and are included in income and fees on loans. Accretion income of $36,000 and $122,000 for the quarters ended September 30, 2023 and 2022 are also included in income and fees on loans.
2Taxable-equivalent adjustments totaling $128,000 and $83,000 for the quarters ended September 30, 2023 and 2022, respectively, are calculated using the statutory federal tax rate and are included in tax-exempt interest on investment securities.

Colony Bankcorp, Inc.
Average Balance Sheet and Net Interest Analysis
	Nine months ended September 30,
	2023									2022
(dollars in thousands)	Average Balances			Income/ Expense			Yields/ Rates			Average Balances			Income/ Expense			Yields/ Rates
Assets
Interest-earning assets:
Loans, net of unearned income 3	$	1,833,405		$	72,403		5.28	%		$	1,448,661		$	50,573		4.67	%
Investment securities, taxable		779,940			16,167		2.77	%			837,492			12,795		2.04	%
Investment securities, tax-exempt 4		106,599			1,837		2.30	%			110,561			1,661		2.01	%
Deposits in banks and short term investments		67,828			1,853		3.65	%			101,432			437		0.58	%
Total interest-earning assets		2,787,772			92,260		4.42	%			2,498,146			65,466		3.50	%
Noninterest-earning assets		224,985									213,556
Total assets	$	3,012,757								$	2,711,702
Liabilities and stockholders' equity
Interest-bearing liabilities:
Interest-earning demand and savings	$	1,388,248		$	10,201		0.98	%		$	1,432,892		$	1,340		0.13	%
Other time		611,032			13,692		3.00	%			347,383			1,334		0.51	%
Total interest-bearing deposits		1,999,280			23,893		1.60	%			1,780,275			2,674		0.20	%
Federal funds purchased		3,703			146		5.29	%			2,820			22		1.04	%
Federal Home Loan Bank advances5		161,099			5,140		4.27	%			65,191			1,746		3.58	%
Other borrowings		70,234			3,164		6.02	%			47,675			1,441		4.04	%
Total other interest-bearing liabilities		235,036			8,450		4.81	%			115,686			3,209		3.71	%
Total interest-bearing liabilities		2,234,316			32,343		1.94	%			1,895,961			5,883		0.41	%
Noninterest-bearing liabilities:
Demand deposits	$	526,469								$	564,425
Other liabilities		13,897									11,357
Stockholders' equity		238,075									239,959
Total noninterest-bearing liabilities and stockholders' equity		778,441									815,741
Total liabilities and stockholders' equity	$	3,012,757								$	2,711,702
Interest rate spread							2.49	%								3.09	%
Net interest income				$	59,917								$	59,583
Net interest margin							2.87	%								3.19	%
________________________________________
3The average balance of loans includes the average balance of nonaccrual loans. Income on such loans is recognized and recorded on the cash basis. Taxable-equivalent adjustments totaling $162,000 and $95,000 for the nine months ended September 30, 2023 and 2022, respectively, are calculated using the statutory federal tax rate and are included in income and fees on loans. Accretion income of $160,000 and $550,000 for the nine months ended September 30, 2023 and 2022 are also included in income and fees on loans.
4Taxable-equivalent adjustments totaling $386,000 and $216,000 for the nine months ended September 30, 2023 and 2022, respectively, are calculated using the statutory federal tax rate and are included in tax-exempt interest on investment securities.
5Federal Home Loan Bank advances interest expense includes $751,000 for the nine months ended September 30, 2022 and is the recognized mark on two advances that were acquired in the SouthCrest acquisition that were called early.

Colony Bankcorp, Inc.
Segment Reporting
		2023											2022
(dollars in thousands)		Third Quarter				Second Quarter			First Quarter				Fourth Quarter				Third Quarter
Banking Division
Net interest income		$	18,778			$	18,562		$	20,141			$	21,037			$	20,508
Provision for credit losses			286				60			900				900				1,320
Noninterest income			6,233				5,433			4,915				4,312				4,288
Noninterest expenses			16,653				17,650			17,812				18,038				17,537
Income taxes			1,777				1,157			1,155				837				1,047
Segment income		$	6,295			$	5,128		$	5,189			$	5,574			$	4,892
Total segment assets		$	2,999,071			$	3,013,689		$	2,930,421			$	2,857,893			$	2,738,082
Full time employees			382				383			407				427				396
Mortgage Banking Division
Net interest income		$	52			$	31		$	3			$	(43	)		$	17
Provision for credit losses			—				—			—				—				—
Noninterest income			1,725				2,015			1,277				1,637				2,345
Noninterest expenses			2,040				1,971			1,712				1,936				2,289
Income taxes			(53	)			14			(86	)			(6	)			10
Segment income		$	(210	)		$	61		$	(346	)		$	(336	)		$	63
Total segment assets		$	9,991			$	15,984		$	7,895			$	18,221			$	16,905
Variable noninterest expense(1)		$	1,245			$	1,149		$	890			$	1,193			$	1,388
Fixed noninterest expense			795				822			822				743				901
Full time employees			45				51			59				65				61
Small Business Specialty Lending Division
Net interest income		$	791			$	588		$	427			$	406			$	340
Provision for credit losses			714				140			—				—				—
Noninterest income			1,760				1,504			1,464				1,739				1,546
Noninterest expenses			2,188				1,811			1,641				1,852				1,541
Income taxes			(70	)			28			50				(20	)			48
Segment income		$	(281	)		$	113		$	200			$	313			$	297
Total segment assets		$	84,761			$	71,398		$	58,625			$	60,456			$	50,925
Full time employees			33				32			30				30				29
Total Consolidated
Net interest income		$	19,621			$	19,181		$	20,571			$	21,400			$	20,865
Provision for credit losses			1,000				200			900				900				1,320
Noninterest income			9,718				8,952			7,656				7,688				8,179
Noninterest expenses			20,881				21,432			21,165				21,826				21,367
Income taxes			1,654				1,199			1,119				811				1,105
Segment income		$	5,804			$	5,302		$	5,043			$	5,551			$	5,252
Total segment assets		$	3,093,823			$	3,101,071		$	2,996,941			$	2,936,570			$	2,805,912
Full time employees			460				466			496				522				486
(1) Variable noninterest expense includes commission based salary expenses and volume based loan related fees.

Colony Bankcorp, Inc.
Consolidated Balance Sheets
		September 30, 2023				December 31, 2022
(dollars in thousands)		(unaudited)				(audited)
ASSETS
Cash and due from banks		$	23,010			$	20,584
Interest-bearing deposits in banks and federal funds sold			118,330				60,094
Cash and cash equivalents			141,340				80,678
Investment securities available for sale, at fair value			399,547				432,553
Investment securities held to maturity, at amortized cost			451,056				465,858
Other investments, at cost			17,323				13,793
Loans held for sale			27,246				17,743
Loans, net of unearned income			1,864,971				1,737,106
Allowance for credit losses			(17,368	)			(16,128	)
Loans, net			1,847,603				1,720,978
Premises and equipment			42,544				41,606
Other real estate			812				651
Goodwill			48,923				48,923
Other intangible assets			4,530				5,664
Bank owned life insurance			56,541				55,504
Deferred income taxes, net			28,934				28,199
Other assets			27,424				24,420
Total assets		$	3,093,823			$	2,936,570
LIABILITIES AND STOCKHOLDERS’ EQUITY
Liabilities:
Deposits:
Noninterest-bearing		$	494,221			$	569,170
Interest-bearing			2,097,111				1,921,827
Total deposits			2,591,332				2,490,997
Federal Home Loan Bank advances			185,000				125,000
Other borrowed money			63,422				78,352
Accrued expenses and other liabilities			15,377				11,953
Total liabilities		$	2,855,131			$	2,706,302
Stockholders’ equity
Common stock, $1 par value; 50,000,000 shares authorized, 17,567,983 and 17,598,123 issued and outstanding, respectively		$	17,568			$	17,598
Paid in capital			168,211				167,537
Retained earnings			120,732				111,573
Accumulated other comprehensive loss, net of tax			(67,819	)			(66,440	)
Total stockholders’ equity			238,692				230,268
Total liabilities and stockholders’ equity		$	3,093,823			$	2,936,570

Colony Bankcorp, Inc.
Consolidated Statements of Income (unaudited)
		Three months ended September 30,							Nine months ended September 30,
		2023			2022				2023			2022
(dollars in thousands, except per share data)
Interest income:
Loans, including fees		$	26,022		$	18,183			$	72,241		$	50,478
Investment securities			5,770			5,266				17,619			14,240
Deposits in banks and short term investments			787			278				1,853			437
Total interest income			32,579			23,727				91,713			65,155
Interest expense:
Deposits			10,338			1,449				23,893			2,674
Federal funds purchased			11			3				146			22
Federal Home Loan Bank advances			1,568			555				5,140			1,746
Other borrowings			1,041			822				3,164			1,441
Total interest expense			12,958			2,829				32,343			5,883
Net interest income			19,621			20,898				59,370			59,272
Provision for credit losses			1,000			1,320				2,100			2,470
Net interest income after provision for credit losses			18,621			19,578				57,270			56,802
Noninterest income:
Service charges on deposits			2,200			2,104				6,141			5,823
Mortgage fee income			1,730			1,708				4,928			7,356
Gain on sales of SBA loans			1,268			1,215				3,429			4,805
Gain on sales of securities			—			(96	)			—			(72	)
Interchange fees			2,202			2,179				6,400			6,338
BOLI income			335			312				1,024			977
Other			1,983			724				4,407			2,110
Total noninterest income			9,718			8,146				26,329			27,337
Noninterest expense:
Salaries and employee benefits			11,973			12,154				37,929			40,498
Occupancy and equipment			1,620			1,645				4,741			4,872
Information technology expenses			2,064			2,491				6,406			7,394
Professional fees			752			881				2,348			2,773
Advertising and public relations			766			876				2,432			2,406
Communications			224			471				710			1,325
Other			3,482			2,849				8,912			8,380
Total noninterest expense			20,881			21,367				63,478			67,648
Income before income taxes			7,458			6,357				20,121			16,491
Income taxes			1,654			1,105				3,972			2,500
Net income		$	5,804		$	5,252			$	16,149		$	13,991
Earnings per common share:
Basic		$	0.33		$	0.30			$	0.92		$	0.82
Diluted			0.33			0.30				0.92			0.82
Dividends declared per share			0.11			0.1075				0.33			0.3225
Weighted average common shares outstanding:
Basic			17,569,493			17,645,119				17,581,817			17,042,838
Diluted			17,569,493			17,645,119				17,581,817			17,042,838

Colony Bankcorp, Inc.
Quarterly Comparison
		2023												2022
(dollars in thousands, except per share data)		Third Quarter				Second Quarter				First Quarter				Fourth Quarter				Third Quarter
Assets		$	3,093,823			$	3,101,071			$	2,996,941			$	2,936,570			$	2,805,912
Loans, net			1,847,603				1,821,776				1,783,254				1,720,978				1,571,431
Deposits			2,591,332				2,627,211				2,516,129				2,490,997				2,409,662
Total equity			238,692				239,455				238,777				230,268				226,067
Net income			5,804				5,302				5,043				5,551				5,252
Earnings per basic share		$	0.33			$	0.30			$	0.29			$	0.31			$	0.30
Key Performance Ratios:
Return on average assets			0.75	%			0.70	%			0.69	%			0.77	%			0.75	%
Return on average total equity			9.61	%			8.88	%			8.73	%			9.76	%			8.85	%
Total equity to total assets			7.72	%			7.72	%			7.97	%			7.84	%			8.06	%
Tangible equity to tangible assets (a)			6.09	%			6.09	%			6.27	%			6.10	%			6.22	%
Net interest margin			2.78	%			2.77	%			3.08	%			3.23	%			3.26	%
(a) Non-GAAP measure - see “Explanation of Certain Unaudited Non-GAAP Financial Measures” for more information and reconciliation to GAAP.

Colony Bankcorp, Inc.
Quarterly Loan Comparison
		2023									2022
(dollars in thousands)		Third Quarter			Second Quarter			First Quarter			Fourth Quarter			Third Quarter
Core		$	1,698,219		$	1,664,855		$	1,614,216		$	1,540,561		$	1,372,257
Purchased			166,752			173,987			185,637			196,545			214,356
Total		$	1,864,971		$	1,838,842		$	1,799,853		$	1,737,106		$	1,586,613

Colony Bankcorp, Inc.
Quarterly Loans by Location Comparison
		2023									2022
(dollars in thousands)		Third Quarter			Second Quarter			First Quarter			Fourth Quarter			Third Quarter
Alabama		$	45,135		$	44,301		$	41,118		$	21,122		$	7,291
Augusta			55,508			55,124			53,415			52,226			42,079
Coastal Georgia			239,281			242,249			248,253			259,730			252,083
Middle Georgia			116,776			119,041			119,720			115,504			114,630
Atlanta and North Georgia			431,632			420,231			419,480			375,106			356,421
South Georgia			446,221			463,558			448,558			457,283			449,684
West Georgia			188,208			192,348			204,664			210,676			177,431
Small Business Specialty Lending			65,187			56,908			50,513			45,944			35,267
Consumer Portfolio Mortgages			245,057			226,755			211,225			197,672			149,945
Marine/RV Lending			31,009			17,137			2,060			—			—
Other			957			1,190			847			1,843			1,782
Total		$	1,864,971		$	1,838,842		$	1,799,853		$	1,737,106		$	1,586,613

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20231025803981/en/

T. Heath Fountain

Chief Executive Officer and Acting Chief Financial Officer

229-426-6000, extension 6012

Source: Colony Bankcorp, Inc.

FAQ

What is the net income for Q3 2023?

The net income for Q3 2023 is $5.8 million.

What is the quarterly cash dividend declared by Colony Bankcorp, Inc.?

Colony Bankcorp, Inc. declared a quarterly cash dividend of $0.11 per share.

What is the total loans increase from the previous quarter?

Total loans increased by $26.1 million, or 1.42%, from the previous quarter.

What is the total deposits decrease from June 30, 2023, to September 30, 2023?

Total deposits decreased by $35.9 million from June 30, 2023, to September 30, 2023.

What is the noninterest income change for the nine months ended September 30, 2023, compared to the same period in 2022?

Noninterest income decreased by $1.0 million for the nine months ended September 30, 2023, compared to the same period in 2022.

What is the noninterest expense for Q3 2023?

The noninterest expense for Q3 2023 is $20.9 million.