EXHIBIT 99.1
Colony Bankcorp, Inc. Announces Third Quarter Results and Management Departure
FITZGERALD, Ga., Oct. 19, 2011 (GLOBE NEWSWIRE) -- Colony Bankcorp, Inc. (Nasdaq:CBAN), today reported net income available to shareholders of $208,000, or $0.02 per diluted share for the third quarter of 2011 compared to third quarter 2010 net loss available to shareholders of $1,384,000, or $(0.16) per diluted share, while net income available to shareholders for nine months ended September 30, 2011 was $1,103,000, or $0.13 per diluted share compared to net loss available to shareholders for the comparable period in 2010 of $879,000, or $(0.11) per diluted share. This increase of 225.48 percent in net income for the comparable nine month periods was primarily driven by the reduction in loan loss provision to $6.00 million for the nine months ended September 30, 2011 from $10.85 million for the comparable period in 2010. "Though earnings are not where we want to be or where we need to be, we are pleased to show improvement in earnings compared to the previous year. Our pre-tax, pre-provision core earnings continue to provide solid support for the credit-related expenses needed to address our problem assets. Until the economy and housing and real estate market reaches a level of stabilization, we expect problem assets, charge-offs and credit-related expenses to continue to be elevated and loan demand to remain slow and sluggish. We still have much work ahead in reducing our problem assets to an acceptable level and returning to our accustomed earnings standards, but we feel that much has been accomplished toward our goal of making incremental progress in 2011," said Terry L. Hester, Executive Vice President and Chief Financial Officer.
Capital
Colony continues to maintain a favorable capital position to be categorized as "well-capitalized" by regulatory benchmarks. At September 30, 2011, the Company's tier one leverage ratio, tier one and total risk-based capital ratios were 9.33 percent, 15.38 percent and 16.64 percent, respectively, compared to the previous quarter end of 8.85 percent, 14.79 percent and 16.05 percent, respectively, at June 30, 2011. Regulatory benchmarks to be categorized as "well-capitalized" for tier one leverage ratio, tier one and total risk-based capital ratios are 5.00 percent, 6.00 percent and 10.00 percent, respectively.
Net Interest Margin
During the third quarter of 2011, the Company reported net interest income of $8.74 million and a net interest margin of 3.21 percent, compared to $9.06 million and 3.09 percent, respectively, for third quarter 2010. While anemic loan demand continues to hamper net interest margin, the Company continues to focus on maximizing its net interest margin through deposit and loan pricing guidance. Those efforts reflected significant improvement during the quarter as net interest margin increased to 3.21 percent for third quarter 2011 compared to 2.97 percent for second quarter 2011.
Asset Quality
The Company continues to closely monitor our non-performing assets and focus on problem asset resolution. Non-performing assets decreased slightly from the previous quarter end to $63.29 million or 8.31 percent of total loans and other real estate owned as of September 30, 2011. This compares to $65.81 million or 8.44 percent, $49.26 million or 5.91 percent and $47.50 million or 5.46 percent, respectively, as of June 30, 2011, December 31, 2010 and September 30, 2010. The level of non-performing assets ties directly to the elevated risk in our residential, land development and commercial real estate loan portfolio and has resulted in higher than normal loan loss provisions the past several years. Unusually high levels of loan loss provisions have been required the past several years as company management addresses asset quality deterioration associated with the housing and real estate downturn and the economy in general. Loan loss reserve methodology resulted in provision for loan losses of $6.00 million in nine months ended September 30, 2011 compared to $10.85 million for the comparable 2010 period. 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 third quarter of 2011 net charge-offs were $734 thousand, or 0.10 percent of average loans as compared to net charge-offs of $4.98 million, or 0.58 percent of average loans in third quarter 2010, while net charge-offs in nine months ended September 30, 2011 were $17.37 million, or 2.25 percent of average loans as compared to net-charge-offs of $14.50 million, or 1.65 percent of average loans in the comparable 2010 period. Restructuring of some substandard and non-performing loans during 2011 has resulted in significant charge-offs, but a strategy deemed prudent in bringing resolution with these credits and a return to performing status in the future. The loan loss reserve was $16.91 million on September 30, 2011, or 2.28 percent of total loans compared to $15.39 million on June 30, 2011, or 2.03 percent of total loans. Management believes that the 2011 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 September 30, 2011.
Noninterest Income
Total noninterest income decreased slightly in the comparable periods as nine months ended September 30, 2011 noninterest income was $7.20 million compared to $7.22 million in the comparable 2010 period. Gains realized from the sale of securities totaled $1.95 million in nine months ended September 30, 2011 compared to a gain recorded on security transactions during the comparable period in 2010 of $1.8 million.. The Company has been successful in generating SBA loans during the year and has realized $864 thousand from the sale of SBA loans in nine months ended September 30, 2011 compared to $514 thousand SBA fee income for the comparable 2010 period. The increased activity with SBA lending has offset the decline in service charge on deposit fee income which has been impacted by recent regulatory changes with Regulation E.
Noninterest Expense
Total noninterest expense decreased to $24.25 million in nine months ended September 30, 2011 compared to $25.12 million in the comparable 2010 period, or a decrease of 3.49 percent. Credit-related expenses including write down and losses on OREO property and repossession and foreclosure expenses decreased to $2.76 million in nine months ended September 30, 2011 compared to $3.68 million in the comparable 2010 period. Salaries and employee benefits expenses increased to $10.78 million in nine months ended September 30, 2011compared to $10.54 million in the comparable 2010 period, or an increase of 2.28 percent. This increase is primarily attributable to an increase in headcount related to increased regulatory compliance demands. Occupancy expenses decreased to $3.08 million in nine months ended September 30, 2011 compared to $3.36 million in the same comparable 2010 period, or a decrease of 8.08 percent. The decrease was primarily attributable to less depreciation expense for the comparable periods.
Recent Development
The board of directors accepted the resignation of Al D. Ross, President and Chief Executive Officer, effective October 18, 2011. Mr. Ross worked with the company nearly fourteen years and served as President and Chief Executive Officer since January 1, 2006. Ross was instrumental in guiding the company through its restructuring and consolidation efforts that began in 2006 and consummated on August 1, 2008 when the seven bank charters were merged into one entity. During the past four years the banking industry has experienced the most challenging economic conditions in nearly eighty years and the board is appreciative of his efforts in successfully guiding the company during these challenging and difficult times. The board and management wish Al the best as he pursues other opportunities.
At its scheduled monthly board meeting on October 18, 2011, the board of directors elected James D. Minix as Interim President and Chief Executive Officer. Mr. Minix brings over forty years experience in the banking industry and has continued to serve on the board since his retirement in January 2006. He began working with Colony in 1990 and previously served as President and Chief Executive Officer of Colony from June 1994 to December 2004 and as Chief Executive Officer from December 2004 to January 2006. Mr. Minix is highly respected in the banking industry and the board is pleased to have him step up and serve in this interim capacity while it explores options in filling the position.
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 | 09/30/11 | 9/30/2010 | 09/30/11 | 09/30/10 |
| Net Interest Income | $8,744 | $9,062 | $26,143 | $28,336 |
| Provision for Loan Losses | 2,250 | 4,200 | 6,000 | 10,850 |
| Non-interest Income | 2,423 | 2,664 | 7,198 | 7,223 |
| Non-interest Expense | 8,091 | 9,115 | 24,248 | 25,124 |
| Income Taxes (Benefits) | 268 | (555) | 940 | (586) |
| Net Income | 558 | (1,034) | 2,153 | 171 |
| Preferred Stock Dividend | 350 | 350 | 1,050 | 1,050 |
| Net Income Available to Common Shareholders | 208 | (1,384) | 1,103 | (879) |
| | | | | |
| | QUARTER ENDED | YEAR-TO-DATE |
| PER COMMON SHARE SUMMARY | 09/30/11 | 9/30/2010 | 09/30/11 | 09/30/10 |
| Common Shares Outstanding | 8,442,258 | 8,444,308 | 8,442,258 | 8,444,308 |
| Weighted Average Basic Shares | 8,442,278 | 8,447,855 | 8,441,070 | 8,049,267 |
| Weighted Average Diluted Shares | 8,442,278 | 8,447,855 | 8,441,070 | 8,049,267 |
| Earnings Per Basic Share (b) | $0.02 | ($0.16) | $0.13 | ($0.11) |
| Earnings Per Diluted Share (b) | $0.02 | ($0.16) | $0.13 | ($0.11) |
| Common Book Value Per Share | $8.33 | $8.11 | $8.33 | $8.11 |
| Tangible Common Book Value Per Share | $8.30 | $8.07 | $8.30 | $8.07 |
| | | | | |
| | QUARTER ENDED | YEAR-TO-DATE |
| OPERATING RATIOS (1) | 09/30/11 | 09/30/10 | 09/30/11 | 09/30/10 |
| Net Interest Margin (a) | 3.21% | 3.09% | 3.05% | 3.15% |
| Return on Average Assets (b) | 0.07% | (0.44)% | 0.12% | (0.09)% |
| Return on Average Total Equity (b) | 0.87% | (5.72)% | 1.56% | (1.25)% |
| Efficiency (c) | 77.75% | 84.02% | 76.90% | 74.13% |
| | | | | |
| (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. |
| | | | | |
| | QUARTER ENDED | | |
| ENDING BALANCES | 09/30/11 | 09/30/10 | | |
| Total Assets | $1,145,983 | $1,231,489 | | |
| Loans, Net of Reserves | 724,030 | 822,161 | | |
| Allowance for Loan Losses | 16,910 | 27,754 | | |
| Intangible Assets | 268 | 304 | | |
| Deposits | 948,356 | 1,005,232 | | |
| Common Shareholders' Equity | 70,308 | 68,491 | | |
| Common Equity to Total Assets | 6.14% | 5.56% | | |
| Total Equity | 97,931 | 95,959 | | |
| Total Equity to Total Assets | 8.55% | 7.79% | | |
| | | | | |
| | QUARTER ENDED | YEAR-TO-DATE |
| AVERAGE BALANCES | 09/30/11 | 09/30/10 | 09/30/11 | 9/30/2010 |
| Total Assets | $1,172,997 | $1,247,711 | $1,220,352 | $1,274,776 |
| Loans, Net of Reserves | 750,810 | 824,627 | 773,615 | 845,046 |
| Deposits | 977,130 | 1,010,973 | 1,012,519 | 1,034,387 |
| Common Shareholders' Equity | 68,244 | 69,269 | 66,437 | 66,655 |
| Total Equity | 95,847 | 96,718 | 93,994 | 94,067 |
| | | | | |
| | QUARTER ENDED | YEAR-TO-DATE |
| ASSET QUALITY | 09/30/11 | 09/30/10 | 09/30/11 | 09/30/10 |
| Nonperforming Loans | $42,148 | $26,628 | $42,148 | $26,628 |
| Nonperforming Assets | 63,289 | 47,498 | 63,289 | 47,498 |
| Net Loan Chg-offs (Recoveries) | 734 | 4,982 | 17,370 | 14,497 |
| Reserve for Loan Loss to Gross Loans | 2.28% | 3.27% | 2.28% | 3.27% |
| Reserve for Loan Loss to Non-performing Loans | 40.12% | 104.23% | 40.12% | 104.23% |
| Reserve for Loan Loss to Non-performing Assets | 26.72% | 58.43% | 26.72% | 58.43% |
| Net Loan Chg-offs (Recoveries) to Avg. Gross Loans | 0.10% | 0.58% | 2.25% | 1.65% |
| Nonperforming Loans to Gross Loans | 5.69% | 3.13% | 5.69% | 3.13% |
| Nonperforming Assets to Total Assets | 5.52% | 3.86% | 5.52% | 3.86% |
| Nonperforming Assets to Total Loans and Other Real Estate | 8.31% | 5.46% | 8.31% | 5.46% |
| | | | | |
| Quarterly Comparative Data (in thousands, except per share data) | | | | |
| | | | | | |
| | 3Q2011 | 2Q2011 | 1Q2011 | 4Q2010 | 3Q2010 |
| | | | | | |
| Assets | $1,145,983 | $1,197,573 | $1,244,075 | $1,275,658 | $1,231,489 |
| Loans | 724,030 | 743,656 | 760,450 | 784,909 | 822,161 |
| Deposits | 948,356 | 1,002,207 | 1,030,963 | 1,059,124 | 1,005,232 |
| Common Shareholders' Equity | 70,308 | 68,009 | 65,316 | 65,452 | 68,491 |
| Total Equity | 97,931 | 95,592 | 92,860 | 92,958 | 95,959 |
| Net Income | 558 | 539 | 1,056 | 303 | (1,034) |
| Net Income Available to | | | | | |
| Common Shareholders | 208 | 189 | 706 | (47) | (1,384) |
| Net Income Per Share | 0.02 | 0.02 | 0.08 | (0.01) | (0.16) |
| | | | | | |
| Key Performance Ratios | 3Q2011 | 2Q2011 | 1Q2011 | 4Q2010 | 3Q2010 |
| | | | | | |
| Return on Average Assets (1) | 0.07% | 0.06% | 0.22% | (0.01)% | (0.44)% |
| Return on Average Total Equity (1) | 0.87% | 0.81% | 3.05% | (0.20)% | (5.72)% |
| Common Equity to Total Assets | 6.14% | 5.68% | 5.25% | 5.13% | 5.56% |
| Total Equity to Total Assets | 8.55% | 7.98% | 7.46% | 7.29% | 7.79% |
| Net Interest Margin | 3.21% | 2.97% | 2.98% | 3.02% | 3.09% |
| (1) Computed using net income available to shareholders | | | | |
| | | |
| Consolidated Balance Sheets Colony Bankcorp, Inc. | | |
| (in thousands) | | |
| | | |
| | Sept. 30, 2011 | Sept. 30, 2010 |
| | (unaudited) | (unaudited) |
| ASSETS | | |
| Cash and Cash Equivalents | | |
| Cash and Due from Banks | $16,777 | $21,243 |
| Federal Funds Sold | 10,561 | 13,327 |
| | 27,338 | 34,570 |
| Interest-Bearing Deposits | 4,409 | 21,285 |
| Investment Securities | | |
| Available for Sale, at Fair Value | 313,119 | 270,793 |
| Held for Maturity, at Cost (Fair Value of $48 and $52 as of Sept. 30, 2011 and Sept. 30, 2010, Respectively) | 49 | 50 |
| | 313,168 | 270,843 |
| Federal Home Loan Bank Stock, at Cost | 5,573 | 6,300 |
| Loans | 740,999 | 849,983 |
| Allowance for Loan Losses | (16,910) | (27,754) |
| Unearned Interest and Fees | (59) | (68) |
| | 724,030 | 822,161 |
| Premises and Equipment | 26,024 | 27,578 |
| Other Real Estate | 20,662 | 20,738 |
| Other Intangible Assets | 268 | 304 |
| Other Assets | 24,511 | 27,710 |
| Total Assets | $1,145,983 | $1,231,489 |
| | | |
| LIABILITIES AND STOCKHOLDERS' EQUITY | | |
| | | |
| Deposits | | |
| Noninterest-Bearing | $88,491 | $76,149 |
| Interest-Bearing | 859,865 | 929,083 |
| | 948,356 | 1,005,232 |
| | | |
| Borrowed Money | | |
| Securities Sold Under Agreements to Repurchase | -- | 25,000 |
| Subordinated Debentures | 24,229 | 24,229 |
| Other Borrowed Money | 71,000 | 76,469 |
| | 95,229 | 125,698 |
| | | |
| Other Liabilities | 4,467 | 4,600 |
| | | |
| Stockholders' Equity | | |
| Preferred Stock, Par Value $1,000; Authorized 10,000,000 | | |
| Shares, Issued 28,000 Shares | 27,623 | 27,468 |
| Common Stock, Par Value $1; Authorized 20,000,000 | | |
| Shares, Issued 8,442,258 and 8,444,308 Shares | 8,442 | 8,444 |
| Paid in Capital | 29,166 | 29,186 |
| Retained Earnings | 29,466 | 28,564 |
| Restricted Stock- Unearned Compensation | (10) | (70) |
| Accumulated Other Comprehensive Loss, Net of Tax | 3,244 | 2,367 |
| | 97,931 | 95,959 |
| Total Liabilities and Stockholders' Equity | $1,145,983 | $1,231,489 |
| | | | |
| Consolidated Statements of Income Colony Bankcorp, Inc. | | | |
| (in thousands except per share data) |
| | | | | |
| | Quarter | Year-to-Date |
| | Three Months Ended | Nine Months Ended |
| | 09/30/11 | 09/30/10 | 09/30/11 | 09/30/10 |
| | (unaudited) | (unaudited) | (unaudited) | (unaudited) |
| Interest Income | | | | |
| Loans, Including Fees | $10,920 | $12,899 | $33,623 | $39,370 |
| Federal Funds Sold and Securities Purchased | | | |
| Under Agreements to Resell | 19 | 28 | 91 | 68 |
| Deposits with Other Banks | 11 | 10 | 37 | 27 |
| Investment Securities |
| U. S. Government Agencies | 1,703 | 1,448 | 5,397 | 5,119 |
| State, County and Municipal | 44 | 26 | 102 | 74 |
| Corporate Obligations/Asset-Backed Sec. | 23 | 23 | 68 | 113 |
| Dividends on Other Investments | 12 | 7 | 36 | 15 |
| | 12,732 | 14,441 | 39,354 | 44,786 |
| Interest Expense | | | |
| Deposits | 3,123 | 4,309 | 10,227 | 13,179 |
| Federal Funds Purchased and Securities Sold |
| Under Agreements to Repurchase | -- | 182 | 338 | 549 |
| Borrowed Money | 865 | 888 | 2,646 | 2,722 |
| | 3,988 | 5,379 | 13,211 | 16,450 |
| Net Interest Income | 8,744 | 9,062 | 26,143 | 28,336 |
| Provision for Loan Losses | 2,250 | 4,200 | 6,000 | 10,850 |
| Net Interest Income After Provision for Loan Losses | 6,494 | 4,862 | 20,143 | 17,486 |
| | | | | |
| Noninterest Income | | | | |
| Service Charges on Deposits | 835 | 879 | 2,391 | 2,722 |
| Other Service Charges, Commissions and Fees | 296 | 291 | 941 | 849 |
| Mortgage Fee Income | 57 | 89 | 161 | 229 |
| Securities Gains | 813 | 922 | 1,945 | 1,800 |
| Other | 422 | 483 | 1,760 | 1,623 |
| | 2,423 | 2,664 | 7,198 | 7,223 |
| Noninterest Expense | | | | |
| Salaries and Employee Benefits | 3,639 | 3,474 | 10,778 | 10,538 |
| Occupancy and Equipment | 1,040 | 1,149 | 3,084 | 3,355 |
| Other | 3,412 | 4,492 | 10,386 | 11,231 |
| | 8,091 | 9,115 | 24,248 | 25,124 |
| | | | | |
| Income (Loss) Before Income Taxes | 826 | (1,589) | 3,093 | (415) |
| Income Taxes (Benefits) | 268 | (555) | 940 | (586) |
| Net Income (Loss) | 558 | (1,034) | 2,153 | 171 |
| | | | | |
| Preferred Stock Dividends | 350 | 350 | 1,050 | 1,050 |
| | | | | |
| Net Income (Loss) Available to Common Shareholders | $208 | ($1,384) | $1,103 | ($879) |
| Net Income (Loss) Per Share of Common Stock | | | | |
| Basic | $0.02 | ($0.16) | $0.13 | ($0.11) |
| Diluted | $0.02 | ($0.16) | $0.13 | ($0.11) |
| Weighted Average Basic Shares Outstanding | 8,442,278 | 8,447,855 | 8,441,070 | 8,049,267 |
| Weighted Average Diluted Shares Outstanding | 8,442,278 | 8,447,855 | 8,441,070 | 8,049,267 |
CONTACT: Terry L. Hester
Chief Financial Officer
(229) 426-6002