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Item 2.
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS
OF
OPERATIONS
Management’s discussion
and analysis ("MD&A") provides supplemental information,
which sets forth
the major factors that have
affected our financial condition and results of
operations
operations and should be read in conjunction with the Consolidated
Financial
Statements and related notes.
The following information should provide a better
understanding of
understanding of the major factors and trends that
affect our earnings performance and financial
condition,
condition, and how our performance during 2021 compares with prior
years.
Throughout this section, Capital City Bank Group,
Inc., and subsidiaries, collectively,
is referred to as "CCBG," "Company,"
"we,"
"us," or "our."
CAUTION CONCERNING FORWARD
-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q, including this MD&A
section, contains
section, contains "forward-looking"forward-looking statements" within the
meaning of the
Private Securities Litigation Reform Act of 1995.
These forward-looking statements include, among others, statements
about
about our
beliefs, plans, objectives, goals, expectations, estimates and
intentions that are
subject to significant risks and uncertainties
and are
subject to change based on various factors, many of which
are beyond
are beyond our control.
The words "may,"
"could,"
"
could," "should,should," "would,"
"believe," "anticipate," "estimate," "expect," "intend,"
"plan," "target,"
"
plan," "target," "goal,goal," and similar expressions are intended
to identify
forward-looking statements.
All forward-looking statements, by their nature, are subject
to risks and uncertainties.
Our actual future results may differ materially
from those set forth in our forward-looking statements.
Please see the Introductory Note and
Item 1A. Risk Factors
Report on Form 10-K, as updated in our subsequent quarterly
reports filed on Form
10-Q, and in our other filings made
from time to
time with the SEC after the date of this report.
However, other factors besides those
listed in
listed in our Quarterly Report or in our Annual Report also
could adversely affect
our results,
and you should not consider any such list of factors to
be a complete set of all potential risks or
uncertainties.
Any forward-looking
statements made by us or on our behalf speak only as of the
date they are made.
We do not undertake
to
to update any forward-looking
statement, except as required by applicable law.
BUSINESS OVERVIEW
We are a financial
holding company headquartered in Tallahassee,
Florida, and we are the parent of our wholly owned subsidiary,
Capital City Bank (the "Bank" or "CCB").
The Bank offers a broad array of products and
services through
services through a total of 57 full-service
offices located in Florida, Georgia,
and Alabama.
The Bank offers commercial and retail banking services,
as well
as well as trust and asset
management,
and retail securities
brokerage.brokerage,and life insurance.
We offer
residential mortgage banking services through Capital City
HomeLoans.Home Loans.
Our profitability,
like
like most financial institutions, is dependent to a large
extent upon net
interest income, which is the difference
between the interest and fees received on earning assets, such
as loans and securities,
and the interest paid on interest-bearing
liabilities, principally deposits and borrowings.
Results of operations are also affected by the provision for
credit
credit losses, noninterest
income such as deposit fees, wealth management fees, mortgage
banking fees
bankingfees and bank card fees, and operating expenses such as
salaries and employee benefits, occupancy,
and other operating expenses, including income taxes.
A detailed discussion regarding the economic conditions
in our markets and
our long-term strategic objectives is included as part
of
the MD&A section of our 2020 Form 10-K.
Acquisitions
Strategic Alliance
On March 1, 2020, CCB completed its acquisition of a 51% membership
interest in Brand Mortgage Group, LLC
(“Brand”) which is
now operated as a Capital City Home Loans
(“CCHL”).
CCHL was consolidated into CCBG’s
financial
financialstatements effective March
1, 2020.
See Note 1 – Business Combination in the 2020 Form 10-K
in the Consolidated Financial
Statements.Statements.On April 30, 2021, a newly formed subsidiary of CCBG, Capital City StrategicWealth, LLC(“CCSW”), completed its acquisition ofsubstantially all of the assets of Strategic WealthGroup, LLC and certain related businesses (“SWG”).CCSW was consolidated into CCBG’s financial statementseffective May 1, 2021.See Note 1 – Business and Basis of Presentation.
RESPONSE TO COVID-19 PANDEMIC
At this time, all of our banking offices have returned to normal bankinghours and lobby services and some back-office associates work remotely while others have returned to an office.Although the ongoing global and local responses to the COVID-19 pandemic continue to impact our clients and associates as they adjust to the changing conditionspresented by the pandemic, we continue to closely monitor COVID-19 and adjust our operations, as needed.In addition, we have set a date (November 22, 2021) to comply with a recent U.S. presidential directive to OSHA to have associates vaccinatedagainst COVID-19 or be tested weekly.