EX-99.1 2 a2q2021cbaner.htm EX-99.1 Document

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For additional information, contact:
Tracie Youngblood
EVP & Chief Financial Officer
(229) 426-6000 (Ext 6003)

COLONY BANKCORP REPORTS SECOND QUARTER 2021 RESULTS
DECLARES QUARTERLY CASH DIVIDEND OF $0.1025 PER SHARE

FITZGERALD, GA. (July 22, 2021) – Colony Bankcorp, Inc. (Nasdaq: CBAN) (“Colony” or the “Company”) today reported net income of $4.0 million, or $0.42 per diluted share, for the quarter ended June 30, 2021, compared with $2.2 million, or $0.23 per diluted share, for the quarter ended June 30, 2020. The Company reported operating net income of $4.6 million, or $0.49 per diluted share, for the quarter ended June 30, 2021, compared with $2.4 million, or $0.25 per diluted share for the same period in 2020. Operating net income for June 30, 2021 and 2020 excludes pre-tax acquisition related expenses, and the net income tax benefit for these adjustments.

For the six months ended June 30, 2021, the Company reported net income of $8.9 million, or $0.94 per diluted share, compared to $3.5 million, or $0.40 per diluted share, for the same period in 2020. The Company reported operating net income of $9.7 million, or $1.02 adjusted earnings per diluted share, for the six months ended June 30, 2021, compared to $4.2 million, or $0.44 adjusted earnings per diluted share, for the same period in 2020.


Second Quarter 2021 Financial Highlights:

•Net income was $4.0 million, or $0.42 per diluted share compared to $2.2 million, or $0.23 per diluted share for the second quarter of 2020.
•Operating net income of $4.6 million, or $0.49 per diluted share, (see Non-GAAP reconciliation).
•No provision for loan losses was recorded in second quarter, a decrease of $500,000, or 100%, compared to the first quarter of 2021.
•Mortgage production was $151.4 million, with $37.7 million in refinances, $103.4 million in purchases, and $10.3 million in construction related loans.
•Small Business Specialty Lending (“SBSL”) closed $15.1 million in SBA loans and sold $9.3 million in SBA loans.

The Company also announced that on July 22, 2021, the Board of Directors declared a quarterly cash dividend of $0.1025 per share, to be paid on its common stock on August 17, 2021, to shareholders of record as of the close of business on August 3, 2021. Outstanding shares as of July 1, 2021 were 9,686,383.

Commenting on the announcement, Heath Fountain, President and Chief Executive Officer, said, “As we moved to a more open economy from the global pandemic, we delivered strong growth in earnings for the second quarter of 2021 compared to the same period last year. Diluted earnings per share increased 81% for the second quarter year over year to $0.42 per diluted share. Our team continued to do a great job serving clients as shown by increased levels of our non-interest income for the period mentioned. Mortgage fee income increased 65% year over year as a result of historically low interest rates and consumer demand, a tribute also to our strategic vision to diversify our revenues. Diluted earnings per share decreased on a sequential quarter basis primarily due to acquisition costs related to our proposed acquisitions of SouthCrest Financial Group, Inc. (PK: SCSG) (“SouthCrest”) and The Barnes Agency (“Barnes”), both with anticipated closings on or before August 1, 2021. Adjusted earnings also increased for the year over year period to $0.49 from $0.25, and decreased 8% from the prior quarter primarily due to increased operating expenses.

“Building a world class organization and recruiting the best of people, we have been very busy at Colony these last several months. The recently announced acquisition of SouthCrest allows us to optimize our balance sheet, further invest in Colony and become a more efficient organization due to the synergies we will experience. In furtherance of our strategic plan, we believe our newly formed Colony Insurance subsidiary operating as an Allstate agency, diversifies our revenue stream by increasing non interest income as well as cross-selling of product lines.
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Furthermore, I am pleased that R. Dallis “D” Copeland, Jr., agreed to join our organization as Special Advisor. D has over 27 years of banking experience at a $45 billion balance sheet financial institution in all areas including commercial real estate, corporate and retail banking, private wealth, credit card, treasury management and strategy. We anticipate leveraging his many skills to continue to build our organization.

“Our balance sheet remains solid with strong credit metrics, as evidenced by no provision for loan losses as well as net recoveries in our loan portfolio for the period ended June 30, 2021. We experienced solid core loan growth while total deposits increased to $1.5 billion, a record for the company. Average interest-bearing deposits increased $77.0 million year over year with most of the increase in lower-yielding demand and savings accounts. Total assets were fairly flat from last year with the prior year period having strong demand for Paycheck Protection Program (“PPP”) loans.

“Net interest income increased 11% year-over-year primarily due to loan fee income recognized on PPP loans forgiven, as well as lower costs of interest bearing liabilities. Our cost related to demand and savings deposits rate was down 15 basis points to 0.07% and total average deposits cost this quarter decreased 33 basis points to 0.20% from the same period last year. The team has done a great job of attracting more deposits while maintaining a strong cost discipline. Moreover, while many banks are reporting decreases in their net interest margin, I am pleased to report our net interest margin increased to 3.68% from 3.46% year over year attributable to lower costs of interest bearing liabilities. While we have experienced inflation across many sectors of the economy, the Federal Reserve Board has so far not increased interest rates and we continue to closely monitor the situation.

“Noninterest income saw very strong growth, increasing 60% year over year, with mortgage fee income increasing to $3.0 million in the current quarter compared to $1.8 million in the second quarter of 2020. Service charges on deposits had a strong quarter increasing 16% over the same period last year. The increase in noninterest income was offset by increases in noninterest expense, such as salaries and employee benefits, information technology expenses as well as elevated acquisition related expenses.

“Our allowance for loan and lease losses now represents 1.26% of total loans outstanding, an increase from 0.92% in the year-earlier quarter and 1.19% on a sequential-quarter basis. Total nonperforming assets decreased to 0.54% of total assets from 0.75% in the year-earlier quarter and from 0.62% on a sequential-quarter basis.

“Average interest earning assets of $1.7 billion increased $80.0 million, or 5%, while total assets remained stable at $1.8 billion. Total loans, including acquisition activity and loans from the Small Business Administration Paycheck Protection Program (“PPP”), decreased 8% year-over-year, while organic loan growth increased 6%.

In closing, Fountain added, “Our management team and Board are always focused on investing, innovating and making strategic decisions to better serve our customers, employees and communities. The acquisitions of SouthCrest and The Barnes Agency will make us the number one community bank in Georgia as well as expand our reach into consumer insurance. We welcome new customers by offering a wide range of financial products and services as well as demonstrating new product lines to our existing customers. All of us at Colony look forward to integrating the SouthCrest and Barnes acquisitions, while continuing to reward our shareholders.”


Balance Sheet

•Total assets totaled $1.8 billion at June 30, 2021, a decrease of $22.1 million, or 1.2%, compared to the same period in 2020. The decrease was primarily related to PPP loans being forgiven beginning in the third quarter of 2020.
•Interest-bearing deposits in banks and federal funds sold at June 30, 2021, totaled $129.4 million, a decrease of $44.4 million, or 25.5% compared to the same period in 2020. The decrease is primarily attributable to the deployment of funds that came from PPP loans and the repayment of Paycheck Protection Program Liquidity Facility (“PPLF”).
•Total loans, including loans held for sale, totaled $1.05 billion at June 30, 2021, a decrease of $77.0 million, or 6.81% from the same period in 2020. Legacy loan growth was up $50.3 million or 5.9% compared to the same period in 2020.
•Deposits totaled $1.54 billion at June 30, 2021, an increase of $120.5 million, or 8.5%, compared to the same period in 2020. The increase in deposits was primarily in noninterest-bearing and interest bearing demand deposits as a result of the PPP loan activity during 2020 and 2021.
•Total borrowings at June 30, 2021, totaled $59.8 million, a decrease of $149.5 million, or 71.4%, compared to the same period in 2020. At June 30, 2021, the PPPLF was completely paid off in the second quarter of 2021.
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Capital

•Colony continues to maintain a strong capital position, with ratios that exceed regulatory minimums required to be classified 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 8.45%, 13.41%, 14.56%, and 11.31%, respectively at June 30, 2021.

Second Quarter Results of Operations

•Net interest income on a tax-equivalent basis for the second quarter 2021 totaled $15.2 million, compared to $13.6 million for the second quarter 2020. The increase during the quarter is primarily attributable to loan fee income recognized on PPP loans forgiven and a decrease in the cost of interest-bearing liabilities.
•Net interest margin was up 18 basis points over the sequential quarter primarily driven by an increase in deferred fee income recognized on PPP loans partially offset by reductions in loan rates driven by Federal Reserve interest rate decreases during 2020. During the quarter ended June 30, 2021, PPP loans totaling approximately $44.6 million were forgiven through the SBA.
•Noninterest income totaled $7.8 million for the second quarter ended June 30, 2021, an increase of $2.9 million, or 60.05%, compared to the same period in 2020. The increase was primarily attributable to growth in mortgage production income as a result of increased loan demand resulting from a historically low interest rate environment.
•Noninterest expense totaled $17.5 million for the second quarter ended June 30, 2021, compared to $13.4 million for the same period in 2020. The increase in noninterest expense primarily resulted from a $2.4 million increase in salary expense largely related to the increase in mortgage and SBSL loan production.

Asset Quality

•Nonperforming assets totaled $9.5 million and $11.2 million at June 30, 2021 and March 31, 2021, respectively.
•OREO and repossessed assets totaled $299,000 at June 30, 2021, a decrease of $248,000, or 45% compared to March 31, 2021.
•Net loan recoveries were $244,000, or (0.09%) of average loans for the second quarter of 2021, compared to net charge-offs of $66,000 in the first quarter of 2021.
•The loan loss reserve was $12.9 million, or 1.26% of total loans, at June 30, 2021, compared to $12.7 million, or 1.14% of total loans, at March 31, 2021.

Asset quality remains strong as indicated by the overall improvement in asset quality ratios as of the second quarter 2021 on a year-over-year comparison along with a decrease in nonperforming assets. .

About Colony Bankcorp

Colony Bankcorp, Inc. is the bank holding company for Colony Bank. Founded in 1975 and headquartered in Fitzgerald, Georgia, Colony operates 29 locations throughout Georgia. The Homebuilder Finance Division helps the local construction industry with building and construction loans, and the Small Business Specialty Lending Division assists small businesses with government guaranteed loans. The Bank also helps its customers achieve their goal of home ownership through Colony Bank Mortgage. 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 Facebook or on Twitter @colony_bank.

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
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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; (v) statements regarding the potential effects of the COVID-19 pandemic on the Company’s business and financial results and conditions; (vi) statements relating to the timing, benefits, costs, and synergies of the proposed merger with SouthCrest (the “Merger”) and the proposed acquisition of Barnes; and (vii) 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 the COVID-19 pandemic on the Company’s assets, business, cash flows, financial condition, liquidity, prospects and results of operations; potential increases in the provision for loan losses resulting from the COVID-19 pandemic; the Company’s ability to implement its various strategic and growth initiatives; competitive pressures among financial institutions increasing significantly; economic conditions, either nationally or locally, in areas in which the Company conducts operations being less favorable than expected; interest rate risk; legislation or regulatory changes which adversely affect the ability of the consolidated Company to conduct business combinations or new operations, including changes to statutes, regulations or regulatory policies or practices as a result of, or in response to COVID-19; 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 related to the COVID-19 pandemic; the risk that the cost savings and any revenue synergies from the Merger and the acquisition of Barnes may not be realized or take longer than anticipated; disruption from the Merger and the acquisition of Barnes with customers, suppliers, employee or other business partners relationships; the occurrence of any event, change or circumstances that could give rise to the termination of the merger agreement with SouthCrest; the risk of successful integration of SouthCrest’s and Barnes’ businesses into the Company; the amount of the costs, fees, expenses and charges related to the Merger and the acquisition of Barnes; reputation risk and the reaction of each of the Company’s and SouthCrest’s customers, suppliers, employees or other business partners to the Merger; the failure of the closing conditions in the merger agreement with SouthCrest to be satisfied, or any unexpected delay in closing of the Merger; the risk that the integration of SouthCrest’s operations into the operations of the Company will be materially delayed or will be more costly or difficult than expected; the possibility that the Merger may be more expensive to complete than anticipated, including as a result of unexpected factors or events; the dilution caused by the Company’s issuance of additional shares of its common stock in the Merger; the risks associated with the Company’s pursuit of future acquisitions; and general competitive, economic, political and market conditions. . 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, 2020, 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 net income; adjusted earnings per diluted share; tangible book value per common share and operating efficiency ratio 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 net income, diluted earnings per share, book value per common share and efficiency ratio, respectively.

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
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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 net income; adjusted earnings per diluted share; tangible book value per common share and operating efficiency ratio and the reconciliation of these measures to net income, diluted earnings per share, book value per common share and efficiency ratio are set forth in the table below.
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Colony Bankcorp, Inc.
Reconciliation of Non-GAAP Measures

20212020
(dollars in thousands, except per share data)
Second QuarterFirst QuarterFourth QuarterThird QuarterSecond Quarter
Operating net income reconciliation
Net income (GAAP)$3,997 $4,919 $4,900 $3,098 $2,214 
Acquisition-related expenses865 176 148 207 220 
Thomaston building write down— — — 582 — 
Gain on sale of Thomaston branch— — (1,026)— — 
Income tax expense (benefit)(225)(46)184 (166)(46)
Operating net income $4,637 $5,049 $4,206 $3,721 $2,388 
Weighted average diluted shares9,498,783 9,498,783 9,498,783 9,498,783 9,498,783 
Adjusted earnings per diluted share$0.49 $0.53 $0.44 $0.39 $0.25 
Tangible book value per common share reconciliation
Book value per common share (GAAP)$15.46 $15.11 $15.21 $14.78 $14.59 
Effect of goodwill and other intangibles(1.97)(1.97)(1.95)(1.96)(1.96)
Tangible book value per common share
$13.50 $13.14 $13.26 $12.82 $12.63 
Operating efficiency ratio calculation
Efficiency ratio (GAAP)76.53 %69.04 %68.93 %76.22 %72.75 %
Acquisition-related expenses(3.44)(0.46)(0.64)(0.97)(1.20)
Gain on sale of Thomaston branch— %— %3.19 %— %— %
Thomaston building write down— %— %— %(2.72)%— %
Operating efficiency ratio 73.10 %68.58 %71.49 %72.53 %71.55 %
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Colony Bankcorp, Inc.
Selected Financial Information

20212020
(dollars in thousands, except per share data)Second QuarterFirst QuarterFourth QuarterThird QuarterSecond Quarter
EARNINGS SUMMARY
Net interest income$15,069 $14,283 $15,151 $13,848 $13,541 
Provision for loan losses— 500 1,296 1,106 2,200 
Non-interest income7,751 8,576 8,039 6,930 4,843 
Non-interest expense17,465 15,782 15,986 15,690 13,375 
Income taxes1,358 1,658 1,008 884 595 
Net income3,997 4,919 4,900 3,098 2,214 
PERFORMANCE MEASURES
Per common share:
Common shares outstanding9,498,783 9,498,783 9,498,783 9,498,783 9,498,783 
Weighted average basic shares9,498,783 9,498,783 9,498,783 9,498,783 9,498,783 
Weighted average diluted shares9,498,783 9,498,783 9,498,783 9,498,783 9,498,783 
Earnings per basic share$0.42 $0.52 $0.52 $0.33 $0.23 
Earnings per diluted share0.42 0.52 0.52 0.33 0.23 
Adjusted earnings per diluted share(b)
0.49 0.53 0.44 0.39 0.25 
Cash dividends declared per share0.1025 0.1025 0.1000 0.1000 0.1000 
Common book value per share15.46 15.11 15.21 14.78 14.59 
Tangible common book value per share(b)
13.50 13.14 13.26 12.82 12.63 
Performance ratios:
Net interest margin (a)
3.68 %3.50 %3.58 %3.34 %3.46 %
Return on average assets0.91 1.12 1.08 0.70 0.52 
Return on average total equity11.14 13.71 13.73 8.80 6.47 
Efficiency ratio
76.53 69.04 68.93 76.22 72.75 
Operating efficiency ratio (b)
73.10 68.58 71.49 72.53 71.55 
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Colony Bankcorp, Inc.
Selected Financial Information

20212020
(dollars in thousands, except per share data)Second QuarterFirst QuarterFourth QuarterThird QuarterSecond Quarter
ASSET QUALITY
Nonperforming loans (NPLs)$9,184 $10,676 $9,128 $9,926 $11,459 
Other real estate owned270 518 1,006 1,875 1,769 
Repossessed assets29 29 30 11 17 
Total nonperforming assets (NPAs)9,483 11,223 10,164 11,812 13,245 
Classified loans 30,852 35,182 30,404 21,388 20,619 
Criticized loans64,818 80,288 75,633 72,076 52,200 
Net loan (recoveries)/charge-offs (244)(66)189 375 295 
Allowance for loan losses to total loans1.26 %1.19 %1.14 %1.00 %0.92 %
Allowance for loan losses to total NPLs140.15 118.89 132.85 111.02 89.79 
Allowance for loan losses to total NPAs135.73 113.10 119.31 93.29 77.68 
Net (recoveries)/charge-offs to average loans0.09 (0.02)0.07 0.13 0.12 
NPLs to total loans0.90 1.00 0.86 0.90 1.03 
NPAs to total assets0.54 0.62 0.58 0.67 0.75 
NPAs to total loans and other real estate owned0.93 1.06 0.96 1.07 1.19 
AVERAGE BALANCES
Total assets $1,774,122 $1,774,123 $1,797,749 $1,766,717 $1,702,902 
Loans, net1,076,784 1,079,007 1,151,872 1,130,231 1,094,299 
Deposits1,547,139 1,475,944 1,456,287 1,140,487 1,384,739 
Total stockholders’ equity145,515 145,515 141,570 139,721 137,213 
(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
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Colony Bankcorp, Inc.
Average Balance Sheet and Net Interest Analysis
Three Months Ended June 30,
20212020
(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$1,076,784 $14,165 5.34 %$1,094,299 $13,763 5.10 %
Investment securities, taxable417,343 1,794 1.74 %330,649 1,757 2.16 %
Investment securities, tax-exempt 233,156 160 1.96 %8,959 46 2.08 %
Deposits in banks and short term investments146,591 45 0.12 %159,902 48 0.12 %
Total interest-earning assets1,673,874 16,164 3.92 %1,593,809 15,614 3.97 %
Noninterest-earning assets100,248 109,093 
Total assets$1,774,122 $1,702,902 
Liabilities and stockholders' equity
Interest-bearing liabilities:
Interest-earning demand and savings$901,978 $146 0.07 %$766,692 $407 0.22 %
Other time253,944 423 0.68 %311,334 996 1.30 %
Total interest-bearing deposits1,155,922 569 0.20 %1,078,026 1,403 0.53 %
Federal Home Loan Bank advances22,500 115 2.09 %36,500 211 2.34 %
Paycheck Protection Program Liquidity Facility19,031 25 0.53 %99,124 87 0.36 %
Other borrowings37,536 258 2.78 %38,694 299 3.13 %
Total other interest-bearing liabilities79,067 398 2.04 %174,318 597 1.39 %
Total interest-bearing liabilities1,234,989 967 0.32 %1,252,344 2,000 0.65 %
Noninterest-bearing liabilities:
Demand deposits$391,217 $306,713 
Other liabilities2,401 6,632 
Stockholders' equity145,515 137,213 
Total noninterest-bearing liabilities and stockholders' equity539,133 450,558 
Total liabilities and stockholders' equity$1,774,122 $1,702,902 
Interest rate spread3.60 %3.33 %
Net interest income$15,197 $13,614 
Net interest margin3.68 %3.46 %

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 $67,000 and $62,000 for the quarter ended June 30, 2021 and 2020, respectively, are included in income and fees on loans. Accretion income of $104,000 and $82,000 for the quarter ended June 30, 2021 and 2020 are also included in income and fees on loans.
2Taxable-equivalent adjustments totaling $43,000 and $12,000 for the quarter ended June 30, 2021 and 2020, respectively, are included in tax-exempt interest on investment securities. The adjustments are based on federal tax rate of 21% and a Georgia state tax rate of 5.75% with appropriate reductions for the effect of disallowed interest expense incurred in carrying tax-exempt obligations.
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Colony Bankcorp, Inc.
Average Balance Sheet and Net Interest Analysis
Six Months Ended June 30,
20212020
(dollars in thousands)Average
Balances		Income/
Expense		Yields/
Rates		Average
Balances		Income/
Expense		Yields/
Rates
Assets
Interest-earning assets:
Loans, net of unearned income3
$1,077,859 $27,805 5.20 %$1,037,242 $27,114 5.27 %
Investment securities, taxable394,431 3,401 1.74 %335,107 3,649 2.20 %
Investment securities, tax-exempt4
32,887 314 1.93 %4,941 54 2.20 %
Deposits in banks and short term investments164,882 97 0.12 %122,885 332 0.54 %
Total interest-earning assets1,670,059 31,617 3.82 %1,500,175 31,149 4.19 %
Noninterest-earning assets105,746 107,661 
Total assets$1,775,805 $1,607,836 
Liabilities and stockholders' equity
Interest-bearing liabilities:
Interest-earning demand and savings$880,838 $311 0.07 %$747,273 $1,342 0.36 %
Other time257,173 912 0.72 %323,073 2,279 1.42 %
Total interest-bearing deposits1,138,011 1,223 0.22 %1,070,346 3,621 0.68 %
Federal Home Loan Bank advances22,500 230 2.06 %41,038 468 2.30 %
Paycheck Protection Program Liquidity Facility51,516 205 0.80 %49,561 87 0.35 %
Other borrowings37,715 402 2.15 %38,745 688 3.58 %
Total other interest-bearing liabilities111,731 837 1.51 %129,344 1,243 1.94 %
Total interest-bearing liabilities1,249,742 2,060 0.33 %1,199,690 4,864 0.82 %
Noninterest-bearing liabilities:
Demand deposits$373,728 $266,163 
Other liabilities7,201 6,223 
Stockholders' equity145,136 135,760 
Total noninterest-bearing liabilities and stockholders' equity526,065 408,146 
Total liabilities and stockholders' equity$1,775,807 $1,607,836 
Interest rate spread3.49 %3.37 %
Net interest income$29,557 $26,285 
Net interest margin3.57 %3.53 %






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 $133,000 and $124,000 for the six months ended June 30, 2021 and 2020, respectively, are included in income and fees on loans. Accretion income of $313,000 and $264,000 for the six months ended June 30, 2021 and 2020 are also included in income and fees on loans.

4Taxable-equivalent adjustments totaling $84,000 and $14,000 for the six months ended June 30, 2021 and 2020, respectively, are included in tax-exempt interest on investment securities. The adjustments are based on federal tax rate of 21% and a Georgia state tax rate of 5.75% with appropriate reductions for the effect of disallowed interest expense incurred in carrying tax-exempt obligations.

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Colony Bankcorp, Inc.
Segment Reporting

20212020
(dollars in thousands)
Second QuarterFirst QuarterFourth QuarterThird QuarterSecond Quarter
Banking Division
Net interest income$14,864 $13,985 $14,752 $13,631 $13,440 
Provision for loan losses— 500 1,296 1,106 2,200 
Noninterest income3,354 3,005 3,952 3,515 2,901 
Noninterest expenses14,366 11,960 11,656 11,792 10,158 
Income taxes1,241 1,160 973 940 842 
Segment income$2,611 $3,370 $4,779 $3,308 $3,141 

Total segment assets
$1,710,345 $1,755,667 $1,709,696 $1,666,742 $1,726,219 
Full time employees
287 291 305 312 321 
Mortgage Banking Division
Net interest income$123 $168 $299 $188 $82 
Provision for loan losses— — — — — 
Noninterest income2,997 3,986 3,420 2,612 1,821 
Noninterest expenses1,887 2,793 2,835 2,410 1,697 
Income taxes60 354 188 82 43 
Segment income$1,173 $1,007 $696 $308 $163 

Total segment assets
$25,149 $27,478 $50,266 $50,265 $17,578 
Full time employees53 51 43 41 40 
Small Business Specialty Lending Division
Net interest income$82 $130 $100 $29 $19 
Provision for loan losses— — — — — 
Noninterest income1,400 1,585 667 803 121 
Noninterest expenses1,212 1,029 1,495 1,488 1,520 
Income taxes57 144 (153)(138)(290)
Segment income$213 $542 $(575)$(518)$(1,090)
Total segment assets
$20,024 $15,901 $4,012 $42,439 $33,771 
Full time employees24 23 21 15 13 
Total Consolidated
Net interest income$15,069 $14,283 $15,151 $13,848 $13,541 
Provision for loan losses— 500 1,296 1,106 2,200 
Noninterest income7,751 8,576 8,039 6,930 4,843 
Noninterest expenses17,465 15,782 15,986 15,690 13,375 
Income taxes1,358 1,658 1,008 884 595 
Segment income$3,997 $4,919 $4,900 3,098 $2,214 
Total segment assets
$1,755,518 $1,799,046 $1,763,974 $1,759,446 $1,777,568 
Full time employees364 365 369 368 374 
11

Colony Bankcorp, Inc.
Consolidated Balance Sheets

June 30, 2021December 31, 2020
(dollars in thousands)
(unaudited)(audited)
ASSETS


Cash and due from banks$16,897 $17,218 
Interest-bearing deposits in banks and federal funds sold129,369 166,288 
Cash and cash equivalents146,266183,506
Investment securities available for sale, at fair value469,714 380,814 
Other investments, at cost2,703 3,296 
Loans held for sale30,910 52,386 
Loans, net of unearned income1,022,618 1,059,503 
Allowance for loan losses(12,871)(12,127)
Loans, net 1,009,747 1,047,376 
Premises and equipment32,689 32,057 
Other real estate270 1,006 
Goodwill and other intangible assets18,701 18,558 
Bank owned life insurance31,805 31,547 
Other assets12,713 13,428 
Total assets$1,755,518 $1,763,974 

LIABILITIES AND STOCKHOLDERS’ EQUITY

Liabilities:

Deposits:
Noninterest-bearing$393,677 $326,999 
Interest-bearing1,148,537 1,118,028 
Total deposits
1,542,214 1,445,027 
Federal Home Loan Bank advances22,500 22,500 
Paycheck Protection Program Liquidity Facility— 106,789 
Other borrowed money37,292 37,792 
Accrued expenses and other liabilities6,618 7,378 
Total liabilities$1,608,624 $1,619,486 
Stockholders’ equity
Common stock, $1 par value; 20,000,000 shares authorized, 9,498,783 issued and outstanding, respectively$9,499 $9,499 
Paid in capital43,232 43,215 
Retained earnings91,963 84,993 
Accumulated other comprehensive income, net of tax2,200 6,781 
Total stockholders’ equity 146,894 144,488 
Total liabilities and stockholders’ equity$1,755,518 $1,763,974 
12

Colony Bankcorp, Inc.
Consolidated Statements of Income (unaudited)

Three months ended June 30,Six months ended June 30,
2021202020212020
(dollars in thousands, except per share data)
Interest income:


Loans, including fees$14,099 13,699 $27,672 26,989 
Investment securities, including tax exempt of $126, $37, $248 and $43, respectively1,893 1,794 3,591 3,788 
Deposits in banks and short term investments44 48 98 332 
Total interest income16,036 15,541 31,361 31,109 
Interest expense:
Deposits569 1,403 1,223 3,622 
Federal Home Loan Bank advances115 211 230 468 
Paycheck Protection Program Liquidity Facility25 87 93 87 
Other borrowings258 299 515 688 
Total interest expense967 2,000 2,061 4,865 
Net interest income
15,069 13,541 29,300 26,244 
Provision for loan losses— 2,200 500 4,156 
Net interest income after provision for loan losses15,069 11,341 28,800 22,088 
Noninterest income:
Service charges on deposits1,264 1,091 2,486 2,590 
Mortgage fee income3,005 1,827 7,000 3,089 
Gain on sale of SBA loans1,263 46 2,735 255 
(Loss)/Gain on sale of securities141 — 137 293 
(Loss)/Gain on sale of assets— 56 — 56 
Interchange fees1,667 1,250 3,197 2,283 
BOLI Income222 160 430 311 
Other189 413 367 212 
Total noninterest income
7,751 4,843 16,352 9,089 
Noninterest expense:
Salaries and employee benefits10,126 7,729 20,081 15,227 
Occupancy and equipment1,245 1,316 2,571 2,634 
Acquisition related865 220 1,040 507 
Information technology expenses1,856 1,380 3,448 2,696 
Professional fees690 480 1,177 862 
Advertising and public relations566 385 1,146 1,020 
Communications308 527 527 420 
Other1,809 1,338 3,232 3,387 
Total noninterest expense
17,465 13,375 33,222 26,753 
Income before income taxes5,355 2,809 11,930 4,424 
Income taxes1,358 595 3,016 923 
Net income$3,997 $2,214 $8,914 $3,501 
Earnings per common share:
Basic$0.42 $0.23 $0.94 $0.40 
Diluted0.42 0.23 0.94 0.40 
Dividends declared per share0.10 0.10 0.21 0.20 
Weighted average common shares outstanding:
Basic9,498,783 9,498,783 9,498,783 9,498,783 
Diluted9,498,783 9,498,783 9,498,783 9,498,783 
13


Colony Bankcorp, Inc.
Quarterly Comparison
20212020
(dollars in thousands, except per share data)
Second QuarterFirst QuarterFourth QuarterThird QuarterSecond Quarter
Assets$1,755,518 $1,799,047 $1,763,974 $1,759,446 $1,777,568 
Loans, net1,009,747 1,050,082 1,047,376 1,090,586 1,103,688 
Deposits1,542,214 1,525,884 1,445,027 1,416,401 1,421,758 
Total equity146,894 143,487 144,488 140,346 138,594 
Net income3,997 4,919 4,900 3,099 2,214 
Earnings per basic share$0.42 $0.52 $0.52 $0.33 $0.23 


Key Performance Ratios:


Return on average assets0.91 %1.12 %1.08 %0.70 %0.52 %
Return on average total equity11.14 %13.71 %13.73 %8.80 %6.47 %
Total equity to total assets8.37 %7.98 %8.19 %7.98 %7.80 %
Tangible equity to tangible assets
7.38 %7.01 %7.21 %7.00 %6.82 %
Net interest margin3.68 %3.50 %3.58 %3.34 %3.41 %


Colony Bankcorp, Inc.
Quarterly Loan Comparison
20212020
(dollars in thousands)Second QuarterFirst QuarterFourth QuarterThird QuarterSecond Quarter
Core$905,850 $888,800 $873,426 $871,416 $855,556 
PPP58,769 102,633 101,147 133,756 133,158 
Purchased57,999 71,342 84,930 96,434 125,263 
Total$1,022,618 $1,062,775 $1,059,503 $1,101,606 $1,113,977 


14

Colony Bankcorp, Inc.
Quarterly Loans by Location Comparison
20212020
(dollars in thousands)Second QuarterFirst QuarterFourth QuarterThird QuarterSecond Quarter
Atlanta$436 $492 $562 $7,025 $7,425 
Augusta30,521 23,982 20,432 22,931 25,140 
Middle Georgia73,458 73,543 68,838 60,275 56,209 
Northwest Georgia2,703 1,698 — — — 
Coastal Georgia236,985 235,094 230,184 224,604 223,746 
South Central Georgia361,821 371,227 372,947 391,702 398,107 
Southwest Georgia95,870 97,575 104,132 101,247 108,070 
West Georgia148,271 148,457 154,819 152,159 154,979 
Small Business Specialty Lending14,923 7,906 4,537 9,281 1,903 
Paycheck Protection Program55,425 102,633 101,147 133,756 133,158 
Purchase Accounting(565)(668)(876)(1,262)(1,196)
Other2,770 836 2,781 5,948 6,436 
Total$1,022,618 $1,062,775 $1,059,503 $1,107,666 $1,113,977 


Colony Bankcorp, Inc.
Quarterly PPP Fees Comparison
20212020
(dollars in thousands)Second QuarterFirst QuarterFourth QuarterThird QuarterSecond Quarter
PPP loan fee income$1,581 $1,212 $1,324 $508 $576 
Unearned income on PPP loans2,573 3,077 2,072 3,396 3,904 
15