EXHIBIT 99.1
Colony Bankcorp, Inc. Announces Second Quarter Results
FITZGERALD, Ga., July 24, 2009 (GLOBE NEWSWIRE) -- Colony Bankcorp, Inc. (Nasdaq:CBAN) today reported a net loss available to shareholders of $6,747,000, or $(0.94) per diluted share for the second quarter of 2009, down from second quarter 2008 net income available to shareholders of $292,000 or $0.04 per diluted share, while the net loss available to shareholders for six months ended June 30, 2009 was $5,984,000, or $(0.83) per diluted share compared to net income available to shareholders for the comparable period in 2008 of $2,505,000, or $0.35 per share. The decrease in net income for both periods is attributable to increased loan loss provisions, credit related charges and an increase in FDIC insurance assessments. "Challenges in the housing and real estate market, particularly further deterioration in property valuations of non-performing assets, continued to have a significant impact on our loan portfolio and earnings in the second quarter. Credit quality issues and a slowing economy have created a n unprecedented operating environment for the banking industry. While we remain committed to aggressively working through this down economic cycle in a timely and prudent manner, our efforts have been hampered by this difficult environment," said Al D. Ross, President and Chief Executive Officer.
The Company continues to closely monitor our real estate dependent loans and focus on asset quality. Non-performing assets decreased to $46.3 million, or 4.74 percent of total loans and other real estate owned as of June 30, 2009. This compares to $53.1 million, or 5.45 percent as of March 31, 2009 and $21.2 million, or 2.21 percent as of June 30, 2008. The level of non-performing assets ties directly to the elevated risk in our residential and land development loan portfolio and has resulted in increased loan loss provisions in 2009 compared to 2008, thus a significant negative impact on our 2009 net income. The second quarter 2009 provision for loan losses was $13.36 million compared to $4.07 million for the same 2008 period, while the provision for loan losses was $17.58 million for first half 2009 compared to $5.14 million for the same 2008 period. Unusually high levels of loan loss provision have been required as company management addresses asset quality deterioration associated with the continued hous ing and real estate downturn. "Though our efforts resulted in a reduction in non-performing assets from the prior quarter-end, we continued to identify new problem loans during second quarter 2009, though at a slower pace than in previous quarters," said Ross. "The increase in loan loss provisions during second quarter 2009 was primarily driven by decreased property valuations of non-performing assets in coastal Georgia and Gulf coast properties. Until we see stabilization in the economy and the housing and real estate market, we expect problem assets and charge-offs to be elevated above historical levels as we work through our problem assets, but our strong capital position enables us to absorb losses without impairing the company's financial soundness."
In the second quarter of 2009 net charge-offs were $13,976,000, or 1.45 percent of average loans as compared to net charge-offs of $1,825,000, or 0.19 percent of average loans in second quarter 2008, while net charge-offs for first half 2009 were $16,221,000, or 1.69 percent of average loans as compared to $3,189,000, or 0.34 percent of average loans for first half 2008. The loan loss reserve was $18.38 million on June 30, 2009, or 1.91 percent of total loans compared to $17.47 million or 1.83 percent on June 30, 2008. Management believes that recent contributions to Allowance for Loan Losses adequately address the level of non-performing assets and the related level of classified assets.
Other significant factors negatively impacting earnings in first half 2009 were the increase in FDIC insurance assessments and credit related expenses. While the banking industry has sustained significant bank failures during the past several quarters, the FDIC insurance fund has fallen to levels requiring increased insurance assessments in order to maintain an adequate FDIC insurance reserve level. As a result, rates utilized for quarterly insurance assessments have increased and a special "one-time" assessment was imposed during second quarter 2009. First half 2009 FDIC insurance assessments totaled $1,722,000 compared to $263,000 for the same 2008 period. Also, the increased activity in non-performing assets resulted in foreclosure and repossession expense increasing to $451,000 for first half 2009 compared to $110,000 for the same 2008 period.
On a positive note, net interest income increased to $9,939,000 in second quarter 2009 compared to $9,060,000 last quarter and to $9,043,000 for second quarter 2008. Net interest margin increased to 3.28 percent in second quarter 2009 compared to 3.06 percent in first quarter 2009. The Company has worked diligently to improve pricing both on deposits and loans. The Company continues loan pricing efforts by establishing floors on variable rate loans to minimize the impact of sharp declines in indexes on which the Company normally sets loan pricing and by establishing guidelines for setting rates on fixed rate products to align with the current interest rate environment. We expect margin improvement to continue the balance of 2009 as we re-price our liabilities in response to the current interest rate environment.
During 2008, the Company merged all of its operations into one sole operating subsidiary which allowed the Company to implement operational enhancements. First half 2009 noninterest expense was $15,664,000, or an increase of 1.25 percent from first half 2008 noninterest expense of $15,471,000. This slight increase was accomplished while at the same time Colony experienced the significant increase in FDIC insurance assessments and repossession/foreclosure expenses.
The Company had total assets of $1,294,575,000, gross loans of $963,829,000, total deposits of $1,016,539,000 and total equity of $103,694,000 at June 30, 2009. Total equity to total assets was 8.01 percent at June 30, 2009 compared to 6.92 percent at June 30, 2008.
Colony continues to maintain a strong capital position, which was strengthened by the completion of the sale on January 9, 2009 of $28 million in preferred stock and warrants to the U. S. Treasury through its Capital Purchase Program. At June 30, 2009, the company's capital ratios were as follows: Tier 1 Risk-Based Capital of 12.82 percent, Leverage ratio of 9.74 percent and Total Risk-Based Capital of 14.07 percent. To be categorized as "well-capitalized," the minimum Tier 1 Risk-Based Capital requirement is six (6) percent and the minimum Total Risk-Based Capital requirement is ten (10) percent. Utilization of these funds during second quarter 2009 were new and renewed loan originations totaling $185 million, of which $68 million represented new loan extensions either funded or committed. Also, new mortgage-backed securities purchased during second quarter 2009 resulted in a net increase of mortgage-backed security holdings of approximately $6 million.
During the quarter, the board of directors declared a quarterly cash dividend of $0.04875 per share compared to $0.0975 declared in first quarter 2009. Though the capital position of the Company remains strong, the board deemed prudent to reduce the level of dividend payout while working through the current level of non-performing assets and disappointing earnings.
Colony Bankcorp, Inc. is a bank holding company headquartered in Fitzgerald, Georgia that consists of one operating subsidiary, Colony Bank. The Company conducts a general full service commercial, consumer and mortgage banking business through thirty offices located in the middle and south Georgia cities of Fitzgerald, Warner Robins, Centerville, Ashburn, Leesburg, Cordele, Albany, Thomaston, Columbus, Sylvester, Tifton, Moultrie, Douglas, Broxton, Savannah, Eastman, Chester, Soperton, Rochelle, Pitts, Quitman and Valdosta, 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.
COLONY BANKCORP, INC.
FINANCIAL HIGHLIGHTS (UNAUDITED)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
QUARTER ENDED YEAR-TO-DATE
EARNINGS SUMMARY 06/30/09 06/30/08 06/30/09 06/30/08
---------- ---------- ---------- ----------
Net Interest Income $ 9,939 $ 9,043 $ 18,999 $ 18,648
Provision for Loan
Losses 13,355 4,071 17,580 5,142
Non-interest Income 2,004 3,034 5,966 5,405
Non-interest Expense 8,303 7,714 15,664 15,471
Income Taxes (3,318) -- (2,960) 935
Net Income (6,397) 292 (5,319) 2,505
Preferred Stock Dividend 350 -- 665 --
Net Income Available to
Common Shareholders (6,747) 292 (5,984) 2,505
PER COMMON SHARE QUARTER ENDED YEAR-TO-DATE
SUMMARY 06/30/09 06/30/08 06/30/09 06/30/08
---------- ---------- ---------- ----------
Common Shares
Outstanding 7,229,163 7,215,463 7,229,163 7,215,463
Weighted Average Basic
Shares 7,209,865 7,197,607 7,206,275 7,194,734
Weighted Average Diluted
Shares 7,209,865 7,197,607 7,206,275 7,194,734
Earnings Per Basic
Share(b) $ (0.94) $ 0.04 $ (0.83) $ 0.35
Earnings Per Diluted
Share(b) $ (0.94) $ 0.04 $ (0.83) $ 0.35
Dividends Declared Per
Share $ 0.0488 $ 0.0975 $ 0.1463 $ 0.1950
Common Book Value Per
Share $ 10.57 $ 11.62 $ 10.57 $ 11.62
Tangible Common Book
Value Per Share $ 10.19 $ 11.23 $ 10.19 $ 11.23
QUARTER ENDED YEAR-TO-DATE
OPERATING RATIOS(1) 06/30/09 06/30/08 06/30/09 06/30/08
---------- ---------- ---------- ----------
Net Interest Margin(a) 3.28% 3.24% 3.17% 3.34%
Return on Average
Assets(b) (2.10)% 0.10% (0.94)% 0.42%
Return on Average Common
Equity(b) (32.81)% 1.36% (14.45)% 5.86%
Efficiency(c) 70.43% 66.85% 69.39% 67.15%
(1) Annualized
(a) Computed using fully taxable-equivalent net income
(b) Computed using net income available to shareholders
(c) Computed by dividing non-interest expense by the sum of fully
taxable-equivalent net interest income and non-interest income
and excluding any security gains/losses.
QUARTER ENDED
ENDING BALANCES 06/30/09 06/30/08
---------- ----------
Total Assets $1,294,575 $1,211,212
Loans, Net of Reserves 945,309 936,608
Allowance for Loan
Losses 18,375 17,466
Goodwill 2,412 2,412
Intangible Assets 349 384
Deposits 1,016,539 976,322
Common Shareholders'
Equity 76,409 83,823
Common Equity to Total
Assets 5.90% 6.92%
Total Equity 103,694 83,823
Total Equity to Total
Assets 8.01% 6.92%
QUARTER ENDED YEAR-TO-DATE
AVERAGE BALANCES 06/30/09 06/30/08 06/30/09 06/30/08
---------- ---------- ---------- ----------
Total Assets $1,282,493 $1,185,944 $1,275,552 $1,188,001
Loans, Net of Reserves 948,172 937,686 943,749 932,589
Deposits 1,008,265 978,477 1,003,719 989,790
Common Shareholders'
Equity 82,260 85,659 82,839 85,483
Total Equity 109,686 85,659 109,002 85,483
QUARTER ENDED YEAR-TO-DATE
ASSET QUALITY 06/30/09 06/30/08 06/30/09 06/30/08
---------- ---------- ---------- ----------
Nonperforming Loans $ 33,224 $ 17,953 $ 33,224 $ 17,953
Nonperforming Assets 46,264 21,151 46,264 21,151
Net Loan Chg-offs
(Recoveries) 13,976 1,825 16,221 3,189
Reserve for Loan Loss
to Gross Loans 1.91% 1.83% 1.91% 1.83%
Reserve for Loan Loss to
Non-performing Loans 55.31% 97.29% 55.31% 97.29%
Reserve for Loan Loss to
Non-performing Assets 39.72% 82.58% 39.72% 82.58%
Net Loan Chg-offs
(Recoveries) to Avg
Gross Loans 1.45% 0.19% 1.69% 0.34%
Nonperforming Loans to
Gross Loans 3.45% 1.88% 3.45% 1.88%
Nonperforming Assets to
Total Assets 3.57% 1.75% 3.57% 1.75%
Nonperforming Assets to
Total Loans And Other
Real Estate 4.74% 2.21% 4.74% 2.21%
Quarterly Comparative Data (in thousands, except per share data)
2Q2009 1Q2009 4Q2008 3Q2008 2Q2008
Assets $1,294,575 $1,283,005 $1,252,782 $1,215,330 $1,211,212
Loans 945,309 943,674 943,841 952,504 936,608
Deposits 1,016,539 1,011,695 1,006,992 977,752 976,322
Common
Shareholders'
Equity 76,409 82,277 83,215 82,806 83,823
Total Equity 103,694 109,527 83,215 82,806 83,823
Net Income (6,397) 1,078 (670) 194 292
Net Income
Available to
Common
Shareholders (6,747) 763 (670) 194 292
Net Income
Per Share (0.94) 0.11 (0.09) 0.03 0.04
Dividends
Declared
Per Share 0.0488 0.0975 0.0975 0.0975 0.0975
Key Performance
Ratios 2Q2009 1Q2009 4Q2008 3Q2008 2Q2008
Return on
Assets(1) (2.10)% 0.24% (0.22)% 0.06% 0.10%
Return on
Equity(1) (32.81)% 3.63% (3.25)% 0.93% 1.36%
Common Equity
to Total
Assets 5.90% 6.41% 6.64% 6.81% 6.92%
Total Equity
to Total
Assets 8.01% 8.54% 6.64% 6.81% 6.92%
Net Interest
Margin 3.28% 3.06% 3.18% 3.34% 3.24%
(1) Computed using net income available to shareholders
Consolidated Balance Sheets Colony Bankcorp, Inc.
(in thousands)
June 30, June 30,
2009 2008
---------- ----------
(unaudited) (audited)
ASSETS
Cash and Cash Equivalents
Cash and Due from Banks $ 23,441 $ 27,478
Federal Funds Sold -- 5,579
---------- ----------
23,341 33,057
---------- ----------
Interest-Bearing Deposits 229 1,783
---------- ----------
Investment Securities
Available for Sale, at Fair Value 249,849 177,054
Held for Maturity, at Cost (Fair Value of
$62 and $65 as of June 30, 2009 and June
30, 2008, Respectively) 59 63
---------- ----------
249,908 177,117
---------- ----------
Federal Home Loan Bank Stock, at Cost 6,345 6,092
---------- ----------
Loans 963,829 954,287
Allowance for Loan Losses (18,375) (17,466)
Unearned Interest and Fees (145) (213)
---------- ----------
945,309 936,608
---------- ----------
Premises and Equipment 29,369 28,606
---------- ----------
Other Real Estate 13,040 3,198
---------- ----------
Goodwill 2,412 2,412
---------- ----------
Other Intangible Assets 349 384
---------- ----------
Other Assets 24,173 21,955
---------- ----------
Total Assets $1,294,575 $1,211,212
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits
Noninterest-Bearing $ 71,370 $ 75,946
Interest-Bearing 945,169 900,376
---------- ----------
1,016,539 976,322
---------- ----------
Borrowed Money
Federal Funds Purchased 12,697 16,465
Securities Sold Under Agreements to
Repurchase 40,000 20,000
Subordinated Debentures 24,229 24,229
Other Borrowed Money 91,000 84,600
---------- ----------
167,926 145,294
---------- ----------
Other Liabilities 6,416 5,773
---------- ----------
Stockholders' Equity
Preferred Stock, Par Value $1,000;
Authorized 10,000,000 Shares,
Issued 28,000 Shares 27,285 --
Common Stock, Par Value $1; Authorized
20,000,000 Shares, Issued 7,229,163 and
7,215,463 Shares 7,229 7,215
Paid in Capital 25,393 24,589
Retained Earnings 44,190 53,185
Restricted Stock- Unearned Compensation (252) (346)
Accumulated Other Comprehensive Loss,
Net of Tax (151) (820)
---------- ----------
103,694 83,823
---------- ----------
Total Liabilities and Stockholders' Equity $1,294,575 $1,211,212
========== ==========
Consolidated Statements of Income Colony Bankcorp, Inc.
(in thousands except per share data)
Quarter Year-to-Date
Three Months Ended Six Months Ended
06/30/09 06/30/08 06/30/09 06/30/08
---------- ---------- ---------- ----------
(unaudited)(unaudited) (unaudited)(unaudited)
Interest Income
Loans, Including Fees $ 14,576 $ 16,742 $ 28,773 $ 35,091
Federal Funds Sold 6 84 11 239
Deposits with Other Banks -- 9 -- 20
Investment Securities
U. S. Government
Agencies 1,907 1,586 3,954 3,267
State, County and
Municipal 60 92 148 230
Corporate Obligations/
Asset-Backed Sec 90 85 213 179
Dividends on Other
Investments -- 82 -- 166
---------- ---------- ---------- ----------
16,639 18,680 33,099 39,192
---------- ---------- ---------- ----------
Interest Expense
Deposits 5,553 8,475 11,726 18,147
Federal Funds Purchased
and Repurchase
Agreements 204 24 436 52
Borrowed Money 943 1,138 1,938 2,345
---------- ---------- ---------- ----------
6,700 9,637 14,100 20,544
---------- ---------- ---------- ----------
Net Interest Income 9,939 9,043 18,999 18,648
Provision for Loan
Losses 13,355 4,071 17,580 5,142
---------- ---------- ---------- ----------
Net Interest Income After
Provision for Loan Losses (3,416) 4,972 1,419 13,506
---------- ---------- ---------- ----------
Noninterest Income
Service Charges on
Deposits 1,042 1,173 2,030 2,338
Other Service Charges,
Commissions and Fees 252 241 488 495
Mortgage Fee Income 129 174 231 343
Securities Gains 221 614 2,538 1,184
Other 360 832 679 1,045
---------- ---------- ---------- ----------
2,004 3,034 5,966 5,405
---------- ---------- ---------- ----------
Noninterest Expense
Salaries and Employee
Benefits 3,583 4,029 7,390 8,432
Occupancy and Equipment 1,041 1,061 2,050 2,068
Other 3,679 2,624 6,224 4,971
---------- ---------- ---------- ----------
8,303 7,714 15,664 15,471
---------- ---------- ---------- ----------
Income Before Income Taxes (9,715) 292 (8,279) 3,440
Income Taxes (3,318) -- (2,960) 935
---------- ---------- ---------- ----------
Net Income (6,397) 292 (5,319) 2,505
---------- ---------- ---------- ----------
Preferred Stock Dividends 350 -- 665 --
Net Income Available to
Common Shareholders $ (6,747)$ 292 $ (5,984)$ 2,505
========== ========== ========== ==========
Net Income Per Share of
Common Stock
Basic $ (0.94)$ 0.04 $ (0.83)$ 0.35
========== ========== ========== ==========
Diluted $ (0.94)$ 0.04 $ (0.83)$ 0.35
========== ========== ========== ==========
Weighted Average Basic
Shares Outstanding 7,209,865 7,197,607 7,206,275 7,194,734
========== ========== ========== ==========
Weighted Average Diluted
Shares Outstanding 7,209,865 7,197,607 7,206,275 7,194,734
========== ========== ========== ==========
CONTACT: Colony Bankcorp, Inc.
Terry L. Hester, Chief Financial Officer
(229) 426-6002
