EXHIBIT 99.1
Colony Bankcorp, Inc. Announces Fourth Quarter Results
FITZGERALD, Ga., Jan. 22, 2010 (GLOBE NEWSWIRE) -- Colony Bankcorp, Inc. (Nasdaq:CBAN), today reported net loss available to shareholders of $14,583,000, or $(2.02) per diluted share for the fourth quarter of 2009, down from fourth quarter 2008 net loss available to shareholders of $670,000 or $(0.09) per diluted share, while the net loss available to shareholders for twelve months ended December 31, 2009 was $20,549,000, or $(2.85) per diluted share compared to net income available to shareholders for the comparable period in 2008 of $2,029,000, or $0.28 per share. The decrease in net income for both periods is primarily attributable to increased loan loss provisions and credit related charges. "We are very disappointed in our poor earnings performance during 2009, but we believe the provision s for real estate dependent and income producing real estate loans were needed to meet the continued decline in collateral values in this segment of our loan portfolio. We also strongly believe in our aggressive efforts to work through our asset problems that have developed during this challenging recessionary period. Our efforts will produce positive future results for Colony as we move through this difficult economic cycle," said Al D. Ross, President and Chief Executive Officer. In addition the Company recognized a non-cash expense for goodwill impairment of $2.4 million and realized a significant increase in FDIC insurance assessments. Improvement in the Company's net interest income and continued favorable capital position are outweighed by continued challenges in the housing and real estate market that have impacted our credit quality and the Company's provision for loan losses. 2009 proved to be a most challenging year – not only for Colony but the entire banking indus try.
Colony continues to maintain a favorable 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 ("CPP"). At December 31, 2009, the Company's tier one and total risk-based capital ratios were approximately 11.78 percent and 13.06 percent, respectively, compared to 10.80 percent and 12.06 percent, respectively, at December 31, 2008. In addition to funds from CPP providing a favorable capital base, the Company continues following the intent of CPP to extend credit as a mechanism to stimulate the economy. During fourth quarter 2009, new and renewed loan originations totaled approximately $126 million, of which $55 million represented new loan extensions either funded or committed.
During the fourth quarter of 2009, the Company reported net interest income of $10.3 million and a net interest margin of 3.36 percent, compared to $10.3 million and 3.38 percent and $9.2 million and 3.18 percent, respectively, for third quarter 2009 and fourth quarter 2008. The Company has worked diligently during 2009 to improve deposit and loan pricing and the Company has now realized three consecutive quarters in which net interest margin has improved compared to the same 2008 periods. Our goal of maximizing pre-tax, pre-provision core earnings will be dependent upon continued disciplined pricing efforts that should result in continued margin improvement, though strategies to manage our interest rate risk exposure by extending some liabilities to longer maturities in anticipation of higher interest rates in the future could pressure our margin in the short term.
The Company continues to closely monitor our real estate dependent loans and focus on asset quality. Non-performing assets decreased slightly from September 30, 2009 to $53.8 million, or 5.65 percent of total loans and other real estate owned as of December 31, 2009. This compares to $55.2 million, or 5.59 percent as of September 30, 2009 and $48.2 million, or 4.95 percent as of December 31, 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 fourth quarter 2009 provision for loan losses was $21.87 million compared to $4.43 million for the same 2008 period, while the provision for loan losses was $43.45 million for twelve months ended December 31, 2009 compared to $12.94 million for the same 2008 period. Unusually high levels of loan loss provision have been re quired as company management addresses asset quality deterioration associated with the continued housing and real estate downturn. 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.
In the fourth quarter of 2009 net charge-offs were $11,823,000, or 1.23 percent of average loans as compared to net charge-offs of $5,362,000, or 0.55 percent of average loans in fourth quarter 2008, while net charge-offs for twelve months ended December 31, 2009 were $29,060,000, or 3.02 percent of average loans as compared to $11,435,000, or 1.19 percent of average loans for the same 2008 period. The loan loss reserve was $31.40 million on December 31, 2009, or 3.37 percent of total loans compared to $17.02 million or 1.77 percent on December 31, 2008. Current regulatory posture for the banking industry regarding methodology in determining loan loss reserve adequacy tends to encourage banks to move toward a more aggressive approach in light of the current environment. In response to the regulatory posture, the Company changed its methodology for loan loss reserve adequacy during the fourth quarter by shortening the look back period for loan loss experience from five years to one year. This change resulted in the need to boost our loan loss provision approximately $12 million to have adequate reserve levels. Management believes that 2009 contributions to Allowance for Loan Losses address the level of non-performing assets and the related level of classified assets to be adequately reserved at December 31, 2009.
Other significant factors negatively impacting YTD 2009 earnings 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 along with a special "one-time" assessment imposed during second quarter 2009. YTD 2009 FDIC insurance assessments total $2,662,000 compared to $603,000 for the same 2008 period. Also, the increased activity in non-performing assets resulted in foreclosure and repossession expense increasing to $1,659,000 for twelve months ended December 31, 2009 compared to $333,000 for the same 2008 period.
During 2008 the Company merged all of its operations into one sole operating subsidiary which allowed the Company to implement operational enhancements. Along with improved risk management oversight and product delivery, the most identifiable "bottom-line" improvement was a reduction in salary and employee benefits to $14.48 million in 2009 compared to $16.24 million in 2008, or a decrease of 10.8 percent.
The Company had total assets of $1,307,089,000, gross loans of $931,392,000, total deposits of $1,057,585,000 and total equity of $89,275,000 at December 31, 2009. Total equity to total assets was 6.83 percent at December 31, 2009 compared to 6.64 percent at December 31, 2008.
As a result of diminished earnings primarily attributable to working through the current level of non-performing assets, suspension of cash dividend payments as announced last quarter will continue until we work through this challenging operating environment and earnings performance returns to a level to support paying dividends. Until stabilization occurs with the economy and real estate market, future earnings performance will likely be impacted as the Company deals with the current regulatory approach to be more aggressive in recognizing losses and ramping up loan loss reserves.
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 futur e 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 | 12/31/09 | 12/31/08 | 12/31/09 | 12/31/08 |
Net Interest Income | $10,263 | $9,242 | $39,566 | $37,375 |
Provision for Loan Losses | 21,865 | 4,426 | 43,445 | 12,938 |
Non-interest Income | 1,266 | 1,820 | 9,544 | 9,005 |
Non-interest Expense | 11,096 | 7,572 | 34,844 | 30,856 |
Income Taxes | (7,199) | (266) | (9,995) | 557 |
Net Income | (14,233) | (670) | (19,184) | 2,029 |
Preferred Stock Dividend | 350 | -- | 1,365 | -- |
Net Income Available to Common Shareholders | (14,583) | (670) | (20,549) | 2,029 |
QUARTER ENDED | YEAR-TO-DATE | |||
PER COMMON SHARE SUMMARY | 12/31/09 | 12/31/08 | 12/31/09 | 12/31/08 |
Common Shares Outstanding | 7,229,163 | 7,212,313 | 7,229,163 | 7,212,313 |
Weighted Average Basic Shares | 7,224,164 | 7,205,436 | 7,213,430 | 7,199,121 |
Weighted Average Diluted Shares | 7,224,164 | 7,205,436 | 7,213,430 | 7,199,121 |
Earnings Per Basic Share (b) | ($2.02) | ($0.09) | ($2.85) | $0.28 |
Earnings Per Diluted Share (b) | ($2.02) | ($0.09) | ($2.85) | $0.28 |
Dividends Declared Per Share | $0.00 | $0.10 | $0.15 | $0.39 |
Common Book Value Per Share | $8.57 | $11.54 | $8.57 | $11.54 |
Tangible Common Book Value Per Share | $8.52 | $11.15 | $8.52 | $11.15 |
QUARTER ENDED | YEAR-TO-DATE | |||
OPERATING RATIOS (1) | 12/31/09 | 12/31/08 | 12/31/09 | 12/31/08 |
Net Interest Margin (a) | 3.36% | 3.18% | 3.27% | 3.30% |
Return on Average Assets (b) | (4.49)% | (0.22)% | (1.60)% | 0.17% |
Return on Average Common Equity (b) | (57.78)% | (3.25)% | (19.45)% | 2.40% |
Efficiency (c) | 71.67% | 67.82% | 69.35% | 67.74% |
(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 security gains/losses and goodwill impairment. |
QUARTER ENDED | ||
ENDING BALANCES | 12/31/09 | 12/31/08 |
Total Assets | $1,307,089 | $1,252,782 |
Loans, Net of Reserves | 899,851 | 943,841 |
Allowance for Loan Losses | 31,401 | 17,016 |
Goodwill | -- | 2,412 |
Intangible Assets | 331 | 367 |
Deposits | 1,057,585 | 1,006,992 |
Common Shareholders' Equity | 61,918 | 83,215 |
Common Equity to Total Assets | 4.74% | 6.64% |
Total Equity | 89,275 | 83,215 |
Total Equity to Total Assets | 6.83% | 6.64% |
QUARTER ENDED | YEAR-TO-DATE | |||
AVERAGE BALANCES | 12/31/09 | 12/31/08 | 12/31/09 | 12/31/08 |
Total Assets | $1,298,355 | $1,237,287 | $1,286,418 | $1,204,846 |
Loans, Net of Reserves | 937,179 | 953,628 | 943,013 | 941,575 |
Deposits | 1,033,726 | 992,646 | 1,016,921 | 986,501 |
Common Shareholders' Equity | 73,636 | 82,586 | 78,915 | 84,372 |
Total Equity | 100,955 | 82,586 | 105,655 | 84,372 |
QUARTER ENDED | YEAR-TO-DATE | |||
ASSET QUALITY | 12/31/09 | 12/31/08 | 12/31/09 | 12/31/08 |
Nonperforming Loans | $33,566 | $35,374 | $33,566 | $35,374 |
Nonperforming Assets | 53,750 | 48,186 | 53,271 | 48,186 |
Net Loan Chg-offs (Recoveries) | 11,823 | 5,362 | 29,060 | 11,435 |
Reserve for Loan Loss to Gross Loans | 3.37% | 1.77% | 3.37% | 1.77% |
Reserve for Loan Loss to Non-performing Loans | 93.55% | 48.10% | 93.55% | 48.10% |
Reserve for Loan Loss to Non-performing Assets | 58.42% | 35.31% | 58.95% | 35.31% |
Net Loan Chg-offs (Recoveries) to Avg. Gross Loans | 1.23% | 0.55% | 3.02% | 1.19% |
Nonperforming Loans to Gross Loans | 3.60% | 3.68% | 3.60% | 3.68% |
Nonperforming Assets to Total Assets | 4.11% | 3.85% | 4.08% | 3.85% |
Nonperforming Assets to Total Loans And Other Real Estate | 5.65% | 4.95% | 5.60% | 4.95% |
Quarterly Comparative Data (in thousands, except per share data) |
4Q2009 | 3Q2009 | 2Q2009 | 1Q2009 | 4Q2008 | |
Assets | $1,307,089 | $1,290,891 | $1,294,575 | $1,283,005 | $1,252,782 |
Loans | 899,851 | 949,629 | 945,309 | 943,674 | 943,841 |
Deposits | 1,057,585 | 1,015,414 | 1,016,539 | 1,011,695 | 1,006,992 |
Common Shareholders' Equity | 61,918 | 76,746 | 76,409 | 82,277 | 83,215 |
Total Equity | 89,275 | 104,067 | 103,694 | 109,527 | 83,215 |
Net Income | (14,233) | 368 | (6,397) | 1,078 | (670) |
Net Income Available to Common Shareholders | (14,583) | 18 | (6,747) | 763 | (670) |
Net Income Per Share | (2.02) | 0.00 | (0.94) | 0.11 | (0.09) |
Dividends Declared Per Share | 0.00 | 0.00 | 0.0488 | 0.0975 | 0.0975 |
Key Performance Ratios | 4Q2009 | 3Q2009 | 2Q2009 | 1Q2009 | 4Q2008 |
Return on Assets (1) | (4.49)% | 0.01% | (2.10)% | 0.24% | (0.22)% |
Return on Equity (1) | (57.78)% | 0.07% | (32.81)% | 3.63% | (3.25)% |
Common Equity to Total Assets | 4.74% | 5.95% | 5.90% | 6.41% | 6.64% |
Total Equity to Total Assets | 6.83% | 8.06% | 8.01% | 8.54% | 6.64% |
Net Interest Margin | 3.36% | 3.38% | 3.28% | 3.06% | 3.18% |
(1) Computed using net income available to shareholders |
Consolidated Balance Sheets Colony Bankcorp, Inc. | ||
(in thousands) | ||
Dec. 31, 2009 | Dec. 31, 2008 | |
(unaudited) | (audited) | |
ASSETS | ||
Cash and Cash Equivalents | ||
Cash and Due from Banks | $25,995 | $29,427 |
Federal Funds Sold | 16,433 | 31 |
42,428 | 29,458 | |
Interest-Bearing Deposits | 6,479 | 147 |
Investment Securities | ||
Available for Sale, at Fair Value | 267,247 | 207,645 |
Held for Maturity, at Cost (Fair Value of $57 and $63 as of Dec. 31, 2009 and Dec. 31, 2008, Respectively) | 54 | 60 |
267,301 | 207,705 | |
Federal Home Loan Bank Stock, at Cost | 6,345 | 6,272 |
Loans | 931,392 | 961,036 |
Allowance for Loan Losses | (31,401) | (17,016) |
Unearned Interest and Fees | (140) | (179) |
899,851 | 943,841 | |
Premises and Equipment | 28,826 | 29,672 |
Other Real Estate | 19,705 | 12,812 |
Goodwill | -- | 2,412 |
Other Intangible Assets | 331 | 367 |
Other Assets | 35,823 | 20,096 |
Total Assets | $1,307,089 | $1,252,782 |
LIABILITIES AND STOCKHOLDERS' EQUITY | ||
Deposits | ||
Noninterest-Bearing | $84,238 | $77,497 |
Interest-Bearing | 973,347 | 929,495 |
1,057,585 | 1,006,992 | |
Borrowed Money | ||
Federal Funds Purchased | -- | 2,274 |
Securities Sold Under Agreements to Repurchase | 40,000 | 40,000 |
Subordinated Debentures | 24,229 | 24,229 |
Other Borrowed Money | 91,000 | 91,000 |
155,229 | 157,503 | |
Other Liabilities | 5,000 | 5,072 |
Stockholders' Equity | ||
Preferred Stock, Par Value $1,000; Authorized 10,000,000 Shares, Issued 28,000 Shares | 27,357 | -- |
Common Stock, Par Value $1; Authorized 20,000,000 Shares, Issued 7,229,163 and 7,212,313 Shares | 7,229 | 7,212 |
Paid in Capital | 25,393 | 24,536 |
Retained Earnings | 29,554 | 51,302 |
Restricted Stock- Unearned Compensation | (158) | (211) |
Accumulated Other Comprehensive Loss, Net of Tax | (100) | 376 |
89,275 | 83,215 | |
Total Liabilities and Stockholders' Equity | $1,307,089 | $1,252,782 |
Consolidated Statements of Income Colony Bankcorp, Inc. | ||||
(in thousands except per share data) | ||||
Quarter | Year-to-Date | |||
Three Months Ended | Twelve Months Ended | |||
12/31/2009 | 12/31/2008 | 12/31/2009 | 12/31/2008 | |
(unaudited) | (audited) | (unaudited) | (audited) | |
Interest Income | ||||
Loans, Including Fees | $14,279 | $15,347 | $57,621 | $66,733 |
Federal Funds Sold | 10 | 10 | 24 | 274 |
Deposits with Other Banks | -- | -- | -- | 27 |
Investment Securities | ||||
U. S. Government Agencies | 1,741 | 2,065 | 7,627 | 7,141 |
State, County and Municipal | 52 | 88 | 259 | 410 |
Corporate Obligations/Asset-Backed Sec. | 9 | 122 | 296 | 414 |
Dividends on Other Investments | 7 | 45 | 20 | 298 |
16,098 | 17,677 | 65,847 | 75,297 | |
Interest Expense | ||||
Deposits | 4,715 | 7,055 | 21,643 | 32,801 |
Federal Funds Purchased and Repurchase Agreements | 218 | 221 | 876 | 514 |
Borrowed Money | 902 | 1,159 | 3,762 | 4,607 |
5,835 | 8,435 | 26,281 | 37,922 | |
Net Interest Income | 10,263 | 9,242 | 39,566 | 37,375 |
Provision for Loan Losses | 21,865 | 4,426 | 43,445 | 12,938 |
Net Interest Income After Provision for Loan Losses | (11,602) | 4,816 | (3,879) | 24,437 |
Noninterest Income | ||||
Service Charges on Deposits | 1,043 | 1,129 | 4,198 | 4,700 |
Other Service Charges, Commissions and Fees | 239 | 246 | 986 | 981 |
Mortgage Fee Income | 104 | 98 | 444 | 609 |
Securities Gains | (521) | -- | 2,626 | 1,195 |
Other | 401 | 347 | 1,290 | 1,520 |
1,266 | 1,820 | 9,544 | 9,005 | |
Noninterest Expense | ||||
Salaries and Employee Benefits | 3,537 | 3,755 | 14,483 | 16,238 |
Occupancy and Equipment | 1,105 | 1,025 | 4,287 | 4,191 |
Other | 6,454 | 2,792 | 16,074 | 10,427 |
11,096 | 7,572 | 34,844 | 30,856 | |
Income Before Income Taxes | (21,432) | (936) | (29,179) | 2,586 |
Income Taxes | (7,199) | (266) | (9,995) | 557 |
Net Income | (14,233) | (670) | (19,184) | 2,029 |
Preferred Stock Dividends | 350 | -- | 1,365 | -- |
Net Income Available to Common Shareholders | $(14,583) | $(670) | $(20,549) | $2,029 |
Net Income Per Share of Common Stock | ||||
Basic | $(2.02) | $(0.09) | $(2.85) | $0.28 |
Diluted | $(2.02) | $(0.09) | $(2.85) | $0.28 |
Weighted Average Basic Shares Outstanding | 7,224,164 | 7,205,436 | 7,213,430 | 7,199,121 |
Weighted Average Diluted Shares Outstanding | 7,224,164 | 7,205,436 | 7,213,430 | 7,199,121 |
CONTACT: Colony Bankcorp, Inc. Terry L. Hester, Chief Financial Officer (229) 426-6002