TALLAHASSEE, Fla., April 24, 2017 (GLOBE NEWSWIRE) -- Capital City Bank Group, Inc. (Nasdaq:CCBG) today reported net income of $2.7 million, or $0.16 per diluted share for the first quarter of 2017 compared to net income of $3.3 million, or $0.20 per diluted share for the fourth quarter of 2016, and $1.6 million, or $0.10 per diluted share, for the first quarter of 2016.
HIGHLIGHTS
- 60% growth in earnings per share over prior year reflects improving operating leverage
- Solid period-end loan growth of 1.3% sequentially and 5.0% over prior year
- Continued progress in reducing noninterest expense ~ 3.5% from prior year
- Lower net loan charge-offs of 10 basis points supports lower level of loan loss provision
- NPAs and classified assets down 7% and 3%, respectively and 33% and 25%, respectively compared to the fourth quarter of 2016 and first quarter of 2016
“2017 is off to a strong start as first quarter results showed continued improvement in most categories,” said William G. Smith, Jr., Chairman, President and CEO. “Earnings were up more than 60% year over year, and loan growth, credit quality and expense management continued their favorable trends. I continue to see an improving economy, and our approach is more focused than any other time I can remember in my career. As we move through 2017, we will continue to execute on those initiatives that add value to our shareowners.”
Compared to the fourth quarter of 2016, performance reflects lower net interest income of $0.3 million, a $0.1 million decrease in noninterest income, and higher noninterest expense of $0.4 million, partially offset by a $0.1 million decrease in the loan loss provision and lower income taxes of $0.1 million.
Compared to the first quarter of 2016, the increase in earnings was due to higher net interest income of $0.5 million, a $0.1 million decrease in the loan loss provision, and lower noninterest expense of $1.0 million, partially offset by higher income taxes of $0.5 million.
The Return on Average Assets was 0.39% and the Return on Average Equity was 4.00% for the first quarter of 2017. These metrics were 0.48% and 4.70% for the fourth quarter of 2016, respectively, and 0.24% and 2.39% for the first quarter of 2016, respectively.
Discussion of Operating Results
Tax equivalent net interest income for the first quarter of 2017 was $20.0 million compared to $20.3 million for the fourth quarter of 2016 and $19.4 million for the first quarter of 2016. The decline in tax equivalent net interest income compared to the fourth quarter of 2016 was attributable to two less calendar days, in addition to the reversal of a non-accrual interest adjustment made during the fourth quarter, partially offset by higher income from overnight funds. The increase in tax-equivalent net interest income compared to the first quarter of 2016 reflected growth in our investment portfolio and higher income from overnight funds.
Although the Federal Open Market Committee (FOMC) increased the federal funds target rate 25 basis points to 100 basis points in March 2017, aggressive lending competition in all markets continues to impact pricing for loans. Some of this pressure has been alleviated by our adjustable rate loans tied to the prime rate. We continue to review our various loan strategies, with the goal of enhancing performance, subject to our overall risk appetite. In addition, we have maintained a disciplined approach to deposit pricing, reflected in our cost of funds being unchanged quarter-over-quarter.
Our net interest margin for the first quarter of 2017 was 3.21%, a decrease of 13 basis points from the fourth quarter of 2016 and an increase of one basis point from the first quarter of 2016. The decrease in the margin compared to the fourth quarter of 2016 was due to an unfavorable shift in earning assets, primarily due to a higher composition of overnight funds driven by the influx of seasonal public deposits. The increase in the margin compared to the first quarter of 2016 was primarily due to a positive shift in earning assets, as overnight funds were utilized to fund growth in the loan and investment portfolios.
The provision for loan losses for the first quarter of 2017 was $0.3 million compared to $0.4 million for the fourth quarter of 2016 and $0.5 million for the first quarter of 2016. The lower level of loan loss provision reflects continued favorable problem loan migration and lower net loan charge-offs, partially offset by growth in the loan portfolio. Net loan charge-offs for the first quarter of 2017 totaled $0.4 million compared to $0.8 million for the fourth quarter of 2016 and the first quarter of 2016. As of March 31, 2017, the allowance for loan losses of $13.3 million was 0.84% of outstanding loans (net of overdrafts) and provided coverage of 161% of nonperforming loans compared to 0.86% and 157%, respectively, as of December 31, 2016 and 0.90% and 150%, respectively, as of March 31, 2016.
Noninterest income for the first quarter of 2017 totaled $12.7 million, a decrease of $0.1 million, or 0.5%, from the fourth quarter of 2016 and comparable to the first quarter of 2016. The decrease from the fourth quarter of 2016 reflects lower deposit fees of $0.1 million and mortgage banking fees of $0.1 million, partially offset by higher wealth management fees of $0.1 million. Compared to the first quarter of 2016, higher mortgage banking fees of $0.3 million was offset by lower deposit fees of $0.3 million. For both comparable periods, the decrease in deposit fees reflects lower overdraft service fees attributable to a reduction in accounts using this service as well as lower utilization by existing users. The year over year improvement in mortgage banking fees reflects continued strong residential home sales activity in our markets.
Noninterest expense for the first quarter of 2017 totaled $27.9 million, an increase of $0.4 million, or 1.3%, over the fourth quarter of 2016. The increase was attributable to an increase in other expense of $0.5 million and other real estate owned (“OREO”) expense of $0.2 million, partially offset by lower compensation expense of $0.2 million and occupancy expense of $0.1 million. The increase in other expense reflects higher processing expense of $0.3 million and telephone expense of $0.2 million. Processing expense for the fourth quarter of 2016 was favorably impacted by our annual VISA processing volume rebate. Telephone expense was unfavorably impacted in the first quarter of 2017 due to running dual circuits as our new telephone system is implemented with an estimated completion date by the end of the second quarter of 2017.
The increase in OREO expense was attributable to lower carrying costs reflective of expense recoveries realized in the fourth quarter of 2016. Noninterest expense decreased $1.0 million, or 3.5%, from the first quarter of 2016 primarily attributable to lower OREO expense of $0.8 million and other expense of $0.3 million. The decrease in OREO expense generally reflects continued progress in property dispositions and lower related carrying costs. The reduction in other expense was primarily attributable to lower debit card fraud losses.
We realized income tax expense of $1.5 million (35% effective rate) for the first quarter of 2017 compared to $1.5 million (32% effective rate) for the fourth quarter of 2016 and $0.9 million (34% effective rate) for the first quarter of 2016. Absent future discrete events, we anticipate our effective tax rate will remain in the range of 34%-35%.
Discussion of Financial Condition
Average earning assets were $2.529 billion for the first quarter of 2017, an increase of $105.8 million, or 4.4%, over the fourth quarter of 2016, and an increase of $88.5 million, or 3.6%, over the first quarter of 2016. The change in average earning assets over the fourth quarter reflects a higher level of public fund deposits. Compared to the first quarter of 2016, average earning assets increased as deposit growth was broad based, occurring in all deposit products except certificates of deposit.
We maintained an average net overnight funds (deposits with banks plus fed funds sold less fed funds purchased) sold position of $245.2 million during the first quarter of 2017 compared to an average net overnight funds sold position of $145.5 million in the fourth quarter of 2016 and $286.2 million in the first quarter of 2016. The increase in net overnight funds compared to the fourth quarter of 2016 primarily reflected higher public fund balances. The decrease in net overnight funds compared to the first quarter of 2016 reflects growth in the loan and investment portfolios, and a reduction in both short-term and long-term borrowings, partially offset by growth in deposit balances.
Average loans increased $12.3 million, or 0.8% when compared to the fourth quarter of 2016, and have grown $78.1 million, or 5.2% when compared to the first quarter of 2016. The increase compared to the fourth quarter of 2016 reflects growth in all loan types except institutional, home equity and direct consumer loans. Growth over the first quarter of 2016 was experienced in all loan products, with the exception of residential mortgages and direct consumer loans.
Without compromising our credit standards or taking on inordinate interest rate risk, we continue to make minor modifications on some of our lending programs to try to mitigate the impact that consumer and business deleveraging has had on our portfolio. These programs, coupled with economic improvements in our anchor markets, have helped to increase overall loan production.
Nonperforming assets (nonaccrual loans and OREO) totaled $17.8 million at the end of the first quarter of 2017, a decrease of $1.4 million, or 7%, from the fourth quarter of 2016 and $8.7 million, or 33%, from the first quarter of 2016. Nonaccrual loans totaled $8.3 million at the end of the first quarter of 2017, a $0.2 million decrease from the fourth quarter of 2016 and a $0.8 million decrease from the first quarter of 2016. Nonaccrual loan additions totaled $2.9 million in the first quarter of 2017 compared to $3.9 million and $3.7 million, respectively, for the fourth and first quarters of 2016. The balance of OREO totaled $9.5 million at the end of the first quarter of 2017, a decrease of $1.1 million and $7.9 million, respectively, from the fourth and first quarters of 2016. For the first quarter of 2017, we added properties totaling $1.5 million, sold properties totaling $2.1 million, and recorded valuation adjustments totaling $0.6 million. Nonperforming assets represented 0.61% of total assets as of March 31, 2017 compared to 0.67% as of December 31, 2016 and 0.95% as of March 31, 2016.
Average total deposits were $2.407 billion for the first quarter of 2017, an increase of $100.4 million, or 4.4%, over the fourth quarter of 2016, and an increase of $148.7 million, or 6.6% over the first quarter of 2016. The increase in deposits when compared to the fourth quarter of 2016 reflected growth in all deposit products except noninterest bearing deposits and certificates of deposit. The seasonal inflow of public fund balances began late in the fourth quarter of 2016, and the public fund balances are expected to decline through late in the fourth quarter of 2017. The increase in deposits compared to the first quarter 2016 reflected increases in all deposit products except certificates of deposit. Average public deposits increased $16.1 million in the first quarter of 2017 compared to the first quarter of 2016.
Deposit levels remain strong, particularly given the recent increase in the fed funds rate, and average core deposits continue to experience growth. Because prudent pricing discipline is critical to managing our mix of deposits, we continue to monitor interest rates paid by competitors in markets we serve.
Compared to the fourth quarter of 2016, average borrowings decreased $5.0 million primarily due to a reduction in FHLB advances. Compared to the first quarter of 2016, average borrowings decreased by $77.4 million due to a partial redemption of subordinated debt, a decline in repurchase agreements, and payoffs of FHLB advances.
Shareowners’ equity was $278.1 million as of March 31, 2017, compared to $275.2 million as of December 31, 2016 and $276.8 million as of March 31, 2016. During the first quarter of 2017, shareowners’ equity was positively impacted by net income of $2.7 million, stock compensation accretion of $0.4 million, a net decrease of $0.3 million in the unrealized loss on investment securities, and net adjustments totaling $0.3 million related to transactions under our stock compensation plans. Shareowners’ equity was reduced by common stock dividends of $0.8 million ($0.05 per share). Our leverage ratio was 9.95%, 10.23%, and 10.34%, respectively, for these periods. Further, as of March 31, 2017, our risk-adjusted capital ratio was 16.44% compared to 16.28% and 17.20% at December 31, 2016 and March 31, 2016, respectively. Our common equity tier 1 ratio was 12.77% as of March 31, 2017, compared to 12.61% as of December 31, 2016 and 12.82% as of March 31, 2016. All of our capital ratios exceed the threshold to be designated as “well-capitalized” under the Basel III capital standards.
About Capital City Bank Group, Inc.
Capital City Bank Group, Inc. (Nasdaq:CCBG) is one of the largest publicly traded financial holding companies headquartered in Florida and has approximately $2.9 billion in assets. We provide a full range of banking services, including traditional deposit and credit services, mortgage banking, asset management, trust, merchant services, bankcards, data processing, and securities brokerage services. Our bank subsidiary, Capital City Bank, was founded in 1895 and now has 60 banking offices and 73 ATMs in Florida, Georgia and Alabama. For more information about Capital City Bank Group, Inc., visit www.ccbg.com.
FORWARD-LOOKING STATEMENTS
Forward-looking statements in this Press Release are based on current plans and expectations that are subject to uncertainties and risks, which could cause the Company’s future results to differ materially. The following factors, among others, could cause the Company’s actual results to differ: the accuracy of the Company’s financial statement estimates and assumptions; legislative or regulatory changes, including the Dodd-Frank Act, Basel III, and the ability to repay and qualified mortgage standards; fluctuations in inflation, interest rates, or monetary policies; the effects of security breaches and computer viruses that may affect the Company’s computer systems or fraud related to debit card products; changes in consumer spending and savings habits; the Company’s growth and profitability; the strength of the U.S. economy and the local economies where the Company conducts operations; the effects of the Company’s lack of a diversified loan portfolio, including the risks of geographic and industry concentrations; harsh weather conditions and man-made disasters; changes in the stock market and other capital and real estate markets; customer acceptance of third-party products and services; increased competition and its effect on pricing, including the long-term impact on our net interest margin from the repeal of Regulation Q; negative publicity and the impact on our reputation; technological changes, especially changes that allow out of market competitors to compete in our markets; changes in accounting; and the Company’s ability to manage the risks involved in the foregoing. Additional factors can be found in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2016, and the Company’s other filings with the SEC, which are available at the SEC’s internet site (http://www.sec.gov). Forward-looking statements in this Press Release speak only as of the date of the Press Release, and the Company assumes no obligation to update forward-looking statements or the reasons why actual results could differ.
USE OF NON-GAAP FINANCIAL MEASURES
We present a tangible common equity ratio and a tangible book value per diluted share that removes the effect of goodwill resulting from merger and acquisition activity. We believe these measures are useful to investors because it allows investors to more easily compare our capital adequacy to other companies in the industry. The GAAP to non-GAAP reconciliation is provided below.
| (Dollars in Thousands) | Mar 31, 2017 | Dec 31, 2016 | Sep 30, 2016 | Jun 30, 2016 | Mar 31, 2016 | |||||||||||
| Shareowners' Equity (GAAP) | $ | 278,059 | $ | 275,168 | $ | 276,624 | $ | 274,824 | $ | 276,833 | ||||||
| Less: Goodwill (GAAP) | 84,811 | 84,811 | 84,811 | 84,811 | 84,811 | |||||||||||
| Tangible Shareowners' Equity (non-GAAP) | A | 193,248 | 190,357 | 191,813 | 190,013 | 192,022 | ||||||||||
| Total Assets (GAAP) | 2,895,531 | 2,845,197 | 2,753,154 | 2,767,636 | 2,792,186 | |||||||||||
| Less: Goodwill (GAAP) | 84,811 | 84,811 | 84,811 | 84,811 | 84,811 | |||||||||||
| Tangible Assets (non-GAAP) | B | $ | 2,810,720 | $ | 2,760,386 | $ | 2,668,343 | $ | 2,682,825 | $ | 2,707,375 | |||||
| Tangible Common Equity Ratio (non-GAAP) | A/B | 6.88 | % | 6.90 | % | 7.19 | % | 7.08 | % | 7.09 | % | |||||
| Actual Diluted Shares Outstanding (GAAP) | C | 16,979 | 16,949 | 16,874 | 16,855 | 17,254 | ||||||||||
| Tangible Book Value per Diluted Share (non-GAAP) | A/C | $ | 11.38 | $ | 11.23 | $ | 11.37 | $ | 11.27 | $ | 11.13 | |||||
| CAPITAL CITY BANK GROUP, INC. | |||||||||
| EARNINGS HIGHLIGHTS | |||||||||
| Unaudited | |||||||||
| Three Months Ended | |||||||||
| (Dollars in thousands, except per share data) | Mar 31, 2017 | Dec 31, 2016 | Mar 31, 2016 | ||||||
| EARNINGS | |||||||||
| Net Income | $ | 2,744 | $ | 3,296 | $ | 1,647 | |||
| Diluted Net Income Per Share | $ | 0.16 | $ | 0.20 | $ | 0.10 | |||
| PERFORMANCE | |||||||||
| Return on Average Assets | 0.39 | % | 0.48 | % | 0.24 | % | |||
| Return on Average Equity | 4.00 | % | 4.70 | % | 2.39 | % | |||
| Net Interest Margin | 3.21 | % | 3.34 | % | 3.20 | % | |||
| Noninterest Income as % of Operating Revenue | 39.19 | % | 38.91 | % | 39.76 | % | |||
| Efficiency Ratio | 85.33 | % | 83.23 | % | 90.13 | % | |||
| CAPITAL ADEQUACY | |||||||||
| Tier 1 Capital | 15.68 | % | 15.51 | % | 16.39 | % | |||
| Total Capital | 16.44 | % | 16.28 | % | 17.20 | % | |||
| Tangible Common Equity (1) | 6.88 | % | 6.90 | % | 7.09 | % | |||
| Leverage | 9.95 | % | 10.23 | % | 10.34 | % | |||
| Common Equity Tier 1 | 12.77 | % | 12.61 | % | 12.82 | % | |||
| Equity to Assets | 9.60 | % | 9.67 | % | 9.91 | % | |||
| ASSET QUALITY | |||||||||
| Allowance as % of Non-Performing Loans | 160.70 | % | 157.40 | % | 150.44 | % | |||
| Allowance as a % of Loans | 0.84 | % | 0.86 | % | 0.90 | % | |||
| Net Charge-Offs as % of Average Loans | 0.10 | % | 0.20 | % | 0.21 | % | |||
| Nonperforming Assets as % of Loans and ORE | 1.11 | % | 1.21 | % | 1.73 | % | |||
| Nonperforming Assets as % of Total Assets | 0.61 | % | 0.67 | % | 0.95 | % | |||
| STOCK PERFORMANCE | |||||||||
| High | $ | 21.79 | $ | 23.15 | $ | 15.88 | |||
| Low | 19.22 | 14.29 | 12.83 | ||||||
| Close | $ | 21.39 | $ | 20.48 | $ | 14.59 | |||
| Average Daily Trading Volume | 23,150 | 23,371 | 22,720 | ||||||
| (1) Tangible common equity ratio is a non-GAAP financial measure. For additional information, including a reconciliation to GAAP, refer to | |||||||||
| page 4. | |||||||||
| CAPITAL CITY BANK GROUP, INC. | |||||||||||||||
| CONSOLIDATED STATEMENT OF FINANCIAL CONDITION | |||||||||||||||
| Unaudited | |||||||||||||||
| 2017 | 2016 | ||||||||||||||
| (Dollars in thousands) | First Quarter | Fourth Quarter | Third Quarter | Second Quarter | First Quarter | ||||||||||
| ASSETS | |||||||||||||||
| Cash and Due From Banks | $ | 47,650 | $ | 48,268 | $ | 79,608 | $ | 51,766 | $ | 45,914 | |||||
| Funds Sold and Interest Bearing Deposits | 290,897 | 247,779 | 144,576 | 220,719 | 304,908 | ||||||||||
| Total Cash and Cash Equivalents | 338,547 | 296,047 | 224,184 | 272,485 | 350,822 | ||||||||||
| Investment Securities Available for Sale | 541,102 | 522,734 | 500,139 | 485,848 | 462,444 | ||||||||||
| Investment Securities Held to Maturity | 158,515 | 177,365 | 189,928 | 204,474 | 187,079 | ||||||||||
| Total Investment Securities | 699,617 | 700,099 | 690,067 | 690,322 | 649,523 | ||||||||||
| Loans Held for Sale | 7,498 | 10,886 | 10,510 | 12,046 | 10,475 | ||||||||||
| Loans, Net of Unearned Interest | |||||||||||||||
| Commercial, Financial, & Agricultural | 214,595 | 216,404 | 223,278 | 207,105 | 183,681 | ||||||||||
| Real Estate - Construction | 59,938 | 58,443 | 54,107 | 46,930 | 42,538 | ||||||||||
| Real Estate - Commercial | 503,868 | 503,978 | 497,775 | 485,329 | 503,259 | ||||||||||
| Real Estate - Residential | 295,406 | 272,895 | 276,193 | 280,015 | 285,772 | ||||||||||
| Real Estate - Home Equity | 231,300 | 236,512 | 235,433 | 235,394 | 234,128 | ||||||||||
| Consumer | 268,921 | 262,735 | 258,173 | 252,347 | 245,197 | ||||||||||
| Other Loans | 9,586 | 8,614 | 10,875 | 11,177 | 10,297 | ||||||||||
| Overdrafts | 1,345 | 1,708 | 1,678 | 2,177 | 1,963 | ||||||||||
| Total Loans, Net of Unearned Interest | 1,584,959 | 1,561,289 | 1,557,512 | 1,520,474 | 1,506,835 | ||||||||||
| Allowance for Loan Losses | (13,335 | ) | (13,431 | ) | (13,744 | ) | (13,677 | ) | (13,613 | ) | |||||
| Loans, Net | 1,571,624 | 1,547,858 | 1,543,768 | 1,506,797 | 1,493,222 | ||||||||||
| Premises and Equipment, Net | 93,755 | 95,476 | 96,499 | 97,313 | 98,029 | ||||||||||
| Goodwill | 84,811 | 84,811 | 84,811 | 84,811 | 84,811 | ||||||||||
| Other Real Estate Owned | 9,501 | 10,638 | 12,738 | 14,622 | 17,450 | ||||||||||
| Other Assets | 90,178 | 99,382 | 90,577 | 89,240 | 87,854 | ||||||||||
| Total Other Assets | 278,245 | 290,307 | 284,625 | 285,986 | 288,144 | ||||||||||
| Total Assets | $ | 2,895,531 | $ | 2,845,197 | $ | 2,753,154 | $ | 2,767,636 | $ | 2,792,186 | |||||
| LIABILITIES | |||||||||||||||
| Deposits: | |||||||||||||||
| Noninterest Bearing Deposits | $ | 836,011 | $ | 791,182 | $ | 801,671 | $ | 798,219 | $ | 790,040 | |||||
| NOW Accounts | 882,605 | 904,014 | 793,363 | 804,263 | 786,432 | ||||||||||
| Money Market Accounts | 263,080 | 252,800 | 257,004 | 259,813 | 254,682 | ||||||||||
| Regular Savings Accounts | 321,160 | 304,680 | 298,682 | 294,432 | 286,807 | ||||||||||
| Certificates of Deposit | 156,449 | 159,610 | 164,387 | 168,079 | 173,447 | ||||||||||
| Total Deposits | 2,459,305 | 2,412,286 | 2,315,107 | 2,324,806 | 2,291,408 | ||||||||||
| Short-Term Borrowings | 7,603 | 12,749 | 12,113 | 9,609 | 62,922 | ||||||||||
| Subordinated Notes Payable | 52,887 | 52,887 | 52,887 | 52,887 | 62,887 | ||||||||||
| Other Long-Term Borrowings | 16,460 | 14,881 | 21,368 | 26,401 | 27,062 | ||||||||||
| Other Liabilities | 81,217 | 77,226 | 75,055 | 79,109 | 71,074 | ||||||||||
| Total Liabilities | 2,617,472 | 2,570,029 | 2,476,530 | 2,492,812 | 2,515,353 | ||||||||||
| SHAREOWNERS' EQUITY | |||||||||||||||
| Common Stock | 170 | 168 | 168 | 168 | 172 | ||||||||||
| Additional Paid-In Capital | 34,859 | 34,188 | 33,152 | 32,855 | 38,671 | ||||||||||
| Retained Earnings | 268,934 | 267,037 | 264,581 | 262,380 | 259,139 | ||||||||||
| Accumulated Other Comprehensive Loss, Net of Tax | (25,904 | ) | (26,225 | ) | (21,277 | ) | (20,579 | ) | (21,149 | ) | |||||
| Total Shareowners' Equity | 278,059 | 275,168 | 276,624 | 274,824 | 276,833 | ||||||||||
| Total Liabilities and Shareowners' Equity | $ | 2,895,531 | $ | 2,845,197 | $ | 2,753,154 | $ | 2,767,636 | $ | 2,792,186 | |||||
| OTHER BALANCE SHEET DATA | |||||||||||||||
| Earning Assets | $ | 2,582,971 | $ | 2,520,053 | $ | 2,402,664 | $ | 2,443,561 | $ | 2,471,741 | |||||
| Interest Bearing Liabilities | 1,700,244 | 1,701,621 | 1,599,804 | 1,615,484 | 1,654,239 | ||||||||||
| Book Value Per Diluted Share | $ | 16.38 | $ | 16.23 | $ | 16.39 | $ | 16.31 | $ | 16.04 | |||||
| Tangible Book Value Per Diluted Share(1) | 11.38 | 11.23 | 11.37 | 11.27 | 11.13 | ||||||||||
| Actual Basic Shares Outstanding | 16,954 | 16,845 | 16,807 | 16,804 | 17,222 | ||||||||||
| Actual Diluted Shares Outstanding | 16,979 | 16,949 | 16,874 | 16,855 | 17,254 | ||||||||||
| (1) Tangible book value per diluted share is a non-GAAP financial measure. For additional information, including a reconciliation to GAAP, refer to page 4. | |||||||||||||||
| CAPITAL CITY BANK GROUP, INC. | |||||||||||
| CONSOLIDATED STATEMENT OF OPERATIONS | |||||||||||
| Unaudited | |||||||||||
| 2017 | 2016 | ||||||||||
| (Dollars in thousands, except per share data) | First Quarter | Fourth Quarter | Third Quarter | Second Quarter | First Quarter | ||||||
| INTEREST INCOME | |||||||||||
| Interest and Fees on Loans | $ | 18,005 | $ | 18,671 | $ | 18,046 | $ | 18,105 | $ | 18,045 | |
| Investment Securities | 2,042 | 1,949 | 1,846 | 1,751 | 1,637 | ||||||
| Funds Sold | 493 | 212 | 212 | 318 | 362 | ||||||
| Total Interest Income | 20,540 | 20,832 | 20,104 | 20,174 | 20,044 | ||||||
| INTEREST EXPENSE | |||||||||||
| Deposits | 281 | 224 | 223 | 211 | 221 | ||||||
| Short-Term Borrowings | 45 | 57 | 43 | 38 | 10 | ||||||
| Subordinated Notes Payable | 379 | 363 | 341 | 343 | 387 | ||||||
| Other Long-Term Borrowings | 99 | 129 | 177 | 206 | 216 | ||||||
| Total Interest Expense | 804 | 773 | 784 | 798 | 834 | ||||||
| Net Interest Income | 19,736 | 20,059 | 19,320 | 19,376 | 19,210 | ||||||
| Provision for Loan Losses | 310 | 464 | - | (97 | ) | 452 | |||||
| Net Interest Income after Provision for Loan Losses | 19,426 | 19,595 | 19,320 | 19,473 | 18,758 | ||||||
| NONINTEREST INCOME | |||||||||||
| Deposit Fees | 5,090 | 5,238 | 5,373 | 5,321 | 5,400 | ||||||
| Bank Card Fees | 2,803 | 2,754 | 2,759 | 2,855 | 2,853 | ||||||
| Wealth Management Fees | 1,842 | 1,773 | 1,774 | 1,690 | 1,792 | ||||||
| Mortgage Banking Fees | 1,308 | 1,392 | 1,503 | 1,267 | 1,030 | ||||||
| Other | 1,675 | 1,621 | 1,602 | 4,082 | 1,602 | ||||||
| Total Noninterest Income | 12,718 | 12,778 | 13,011 | 15,215 | 12,677 | ||||||
| NONINTEREST EXPENSE | |||||||||||
| Compensation | 16,496 | 16,699 | 15,993 | 16,051 | 16,241 | ||||||
| Occupancy, Net | 4,381 | 4,519 | 4,734 | 4,584 | 4,459 | ||||||
| Other Real Estate, Net | 583 | 343 | 821 | 1,060 | 1,425 | ||||||
| Other | 6,462 | 5,999 | 6,474 | 7,007 | 6,805 | ||||||
| Total Noninterest Expense | 27,922 | 27,560 | 28,022 | 28,702 | 28,930 | ||||||
| OPERATING PROFIT | 4,222 | 4,813 | 4,309 | 5,986 | 2,505 | ||||||
| Income Tax Expense | 1,478 | 1,517 | 1,436 | 2,056 | 858 | ||||||
| NET INCOME | $ | 2,744 | $ | 3,296 | $ | 2,873 | $ | 3,930 | $ | 1,647 | |
| PER SHARE DATA | |||||||||||
| Basic Net Income | $ | 0.16 | $ | 0.20 | $ | 0.18 | $ | 0.22 | $ | 0.10 | |
| Diluted Net Income | 0.16 | 0.20 | 0.17 | 0.22 | 0.10 | ||||||
| Cash Dividend | $ | 0.05 | $ | 0.05 | $ | 0.04 | $ | 0.04 | $ | 0.04 | |
| AVERAGE SHARES | |||||||||||
| Basic | 16,919 | 16,809 | 16,804 | 17,144 | 17,202 | ||||||
| Diluted | 16,944 | 16,913 | 16,871 | 17,196 | 17,235 | ||||||
| CAPITAL CITY BANK GROUP, INC. | |||||||||||||||
| ALLOWANCE FOR LOAN LOSSES | |||||||||||||||
| AND RISK ELEMENT ASSETS | |||||||||||||||
| Unaudited | |||||||||||||||
| 2017 | 2016 | ||||||||||||||
| (Dollars in thousands, except per share data) | First Quarter | Fourth Quarter | Third Quarter | Second Quarter | First Quarter | ||||||||||
| ALLOWANCE FOR LOAN LOSSES | |||||||||||||||
| Balance at Beginning of Period | $ | 13,431 | $ | 13,744 | $ | 13,677 | $ | 13,613 | $ | 13,953 | |||||
| Provision for Loan Losses | 310 | 464 | - | (97 | ) | 452 | |||||||||
| Net Charge-Offs (Recoveries) | 406 | 777 | (67 | ) | (161 | ) | 792 | ||||||||
| Balance at End of Period | $ | 13,335 | $ | 13,431 | $ | 13,744 | $ | 13,677 | $ | 13,613 | |||||
| As a % of Loans | 0.84 | % | 0.86 | % | 0.88 | % | 0.89 | % | 0.90 | % | |||||
| As a % of Nonperforming Loans | 160.70 | % | 157.40 | % | 159.56 | % | 166.50 | % | 150.44 | % | |||||
| CHARGE-OFFS | |||||||||||||||
| Commercial, Financial and Agricultural | $ | 93 | $ | 377 | $ | 143 | $ | 304 | $ | 37 | |||||
| Real Estate - Construction | - | - | - | - | - | ||||||||||
| Real Estate - Commercial | 71 | 70 | 5 | - | 274 | ||||||||||
| Real Estate - Residential | 116 | 120 | 96 | 205 | 478 | ||||||||||
| Real Estate - Home Equity | 92 | 38 | 51 | 146 | 215 | ||||||||||
| Consumer | 624 | 771 | 479 | 438 | 439 | ||||||||||
| Total Charge-Offs | $ | 996 | $ | 1,376 | $ | 774 | $ | 1,093 | $ | 1,443 | |||||
| RECOVERIES | |||||||||||||||
| Commercial, Financial and Agricultural | $ | 81 | $ | 50 | $ | 199 | $ | 49 | $ | 39 | |||||
| Real Estate - Construction | - | - | - | - | - | ||||||||||
| Real Estate - Commercial | 23 | 45 | 45 | 237 | 81 | ||||||||||
| Real Estate - Residential | 213 | 277 | 139 | 579 | 236 | ||||||||||
| Real Estate - Home Equity | 29 | 32 | 237 | 81 | 59 | ||||||||||
| Consumer | 244 | 195 | 221 | 308 | 236 | ||||||||||
| Total Recoveries | $ | 590 | $ | 599 | $ | 841 | $ | 1,254 | $ | 651 | |||||
| NET CHARGE-OFFS (RECOVERIES) | $ | 406 | $ | 777 | $ | (67 | ) | $ | (161 | ) | $ | 792 | |||
| Net Charge-Offs as a % of Average Loans(1) | 0.10 | % | 0.20 | % | (0.02 | )% | (0.04 | )% | 0.21 | % | |||||
| RISK ELEMENT ASSETS | |||||||||||||||
| Nonaccruing Loans | $ | 8,298 | $ | 8,533 | $ | 8,614 | $ | 8,214 | $ | 9,049 | |||||
| Other Real Estate Owned | 9,501 | 10,638 | 12,738 | 14,622 | 17,450 | ||||||||||
| Total Nonperforming Assets | $ | 17,799 | $ | 19,171 | $ | 21,352 | $ | 22,836 | $ | 26,499 | |||||
| Past Due Loans 30-89 Days | $ | 3,263 | $ | 6,438 | $ | 5,667 | $ | 3,872 | $ | 3,599 | |||||
| Past Due Loans 90 Days or More | - | - | - | - | - | ||||||||||
| Classified Loans | 40,978 | 41,507 | 43,228 | 45,058 | 49,780 | ||||||||||
| Performing Troubled Debt Restructuring's | $ | 36,555 | $ | 38,233 | $ | 35,046 | $ | 35,526 | $ | 36,700 | |||||
| Nonperforming Loans as a % of Loans | 0.52 | % | 0.54 | % | 0.55 | % | 0.54 | % | 0.60 | % | |||||
| Nonperforming Assets as a % of Loans and Other Real Estate | 1.11 | % | 1.21 | % | 1.35 | % | 1.48 | % | 1.73 | % | |||||
| Nonperforming Assets as a % of Total Assets | 0.61 | % | 0.67 | % | 0.78 | % | 0.83 | % | 0.95 | % | |||||
| (1) Annualized | |||||||||||||||
| CAPITAL CITY BANK GROUP, INC. | ||||||||||||||||||||||||||||||||||||||||
| AVERAGE BALANCE AND INTEREST RATES(1) | ||||||||||||||||||||||||||||||||||||||||
| Unaudited | ||||||||||||||||||||||||||||||||||||||||
| First Quarter 2017 | Fourth Quarter 2016 | Third Quarter 2016 | Second Quarter 2016 | First Quarter 2016 | ||||||||||||||||||||||||||||||||||||
| (Dollars in thousands) | Average Balance | Interest | Average Rate | Average Balance | Interest | Average Rate | Average Balance | Interest | Average Rate | Average Balance | Interest | Average Rate | Average Balance | Interest | Average Rate | |||||||||||||||||||||||||
| ASSETS: | ||||||||||||||||||||||||||||||||||||||||
| Loans, Net of Unearned Interest | $ | 1,585,561 | 18,137 | 4.64 | % | $ | 1,573,264 | 18,827 | 4.76 | % | $ | 1,555,889 | 18,216 | 4.66 | % | $ | 1,531,777 | 18,233 | 4.79 | % | $ | 1,507,508 | 18,141 | 4.84 | % | |||||||||||||||
| Investment Securities | ||||||||||||||||||||||||||||||||||||||||
| Taxable Investment Securities | 600,528 | 1,784 | 1.20 | 614,560 | 1,726 | 1.12 | 606,606 | 1,632 | 1.07 | 571,343 | 1,539 | 1.08 | 552,092 | 1,420 | 1.03 | |||||||||||||||||||||||||
| Tax-Exempt Investment Securities | 97,965 | 396 | 1.62 | 90,046 | 343 | 1.52 | 89,241 | 327 | 1.47 | 90,030 | 325 | 1.44 | 94,951 | 332 | 1.40 | |||||||||||||||||||||||||
| Total Investment Securities | 698,493 | 2,180 | 1.26 | 704,606 | 2,069 | 1.17 | 695,847 | 1,959 | 1.12 | 661,373 | 1,864 | 1.13 | 647,043 | 1,752 | 1.09 | |||||||||||||||||||||||||
| Funds Sold | 245,153 | 493 | 0.81 | 145,518 | 212 | 0.58 | 166,207 | 212 | 0.51 | 254,627 | 318 | 0.50 | 286,167 | 362 | 0.51 | |||||||||||||||||||||||||
| Total Earning Assets | 2,529,207 | $ | 20,810 | 3.33 | % | 2,423,388 | $ | 21,108 | 3.47 | % | 2,417,943 | $ | 20,387 | 3.35 | % | 2,447,777 | $ | 20,415 | 3.35 | % | 2,440,718 | $ | 20,255 | 3.34 | % | |||||||||||||||
| Cash and Due From Banks | 48,906 | 50,207 | 45,139 | 46,605 | 47,834 | |||||||||||||||||||||||||||||||||||
| Allowance for Loan Losses | (13,436 | ) | (14,017 | ) | (14,052 | ) | (14,254 | ) | (13,999 | ) | ||||||||||||||||||||||||||||||
| Other Assets | 280,463 | 283,885 | 285,435 | 287,726 | 289,193 | |||||||||||||||||||||||||||||||||||
| Total Assets | $ | 2,845,140 | $ | 2,743,463 | $ | 2,734,465 | $ | 2,767,854 | $ | 2,763,746 | ||||||||||||||||||||||||||||||
| LIABILITIES: | ||||||||||||||||||||||||||||||||||||||||
| Interest Bearing Deposits | ||||||||||||||||||||||||||||||||||||||||
| NOW Accounts | $ | 880,707 | $ | 134 | 0.06 | % | $ | 782,518 | $ | 78 | 0.04 | % | $ | 774,899 | $ | 78 | 0.04 | % | $ | 762,667 | $ | 67 | 0.04 | % | $ | 798,996 | $ | 69 | 0.03 | % | ||||||||||
| Money Market Accounts | 259,106 | 35 | 0.06 | 257,398 | 31 | 0.05 | 258,183 | 30 | 0.05 | 257,000 | 30 | 0.05 | 252,446 | 29 | 0.05 | |||||||||||||||||||||||||
| Savings Accounts | 311,212 | 38 | 0.05 | 303,006 | 37 | 0.05 | 297,172 | 37 | 0.05 | 291,210 | 36 | 0.05 | 277,745 | 34 | 0.05 | |||||||||||||||||||||||||
| Time Deposits | 158,289 | 74 | 0.19 | 161,859 | 78 | 0.19 | 165,324 | 78 | 0.19 | 170,837 | 78 | 0.19 | 177,057 | 89 | 0.20 | |||||||||||||||||||||||||
| Total Interest Bearing Deposits | 1,609,314 | 281 | 0.07 | % | 1,504,781 | 224 | 0.06 | % | 1,495,578 | 223 | 0.06 | % | 1,481,714 | 211 | 0.06 | % | 1,506,244 | 221 | 0.06 | % | ||||||||||||||||||||
| Short-Term Borrowings | 12,810 | 45 | 1.43 | % | 14,768 | 57 | 1.54 | % | 12,162 | 43 | 1.39 | % | 53,691 | 38 | 0.28 | % | 66,938 | 10 | 0.06 | % | ||||||||||||||||||||
| Subordinated Notes Payable | 52,887 | 379 | 2.86 | 52,887 | 363 | 2.68 | 52,887 | 341 | 2.52 | 54,316 | 343 | 2.50 | 62,887 | 387 | 2.43 | |||||||||||||||||||||||||
| Other Long-Term Borrowings | 14,468 | 99 | 2.77 | 17,473 | 129 | 2.93 | 23,629 | 177 | 2.98 | 26,721 | 206 | 3.11 | 27,769 | 216 | 3.12 | |||||||||||||||||||||||||
| Total Interest Bearing Liabilities | 1,689,479 | $ | 804 | 0.20 | % | 1,589,909 | $ | 773 | 0.20 | % | 1,584,256 | $ | 784 | 0.20 | % | 1,616,442 | $ | 798 | 0.20 | % | 1,663,838 | $ | 834 | 0.20 | % | |||||||||||||||
| Noninterest Bearing Deposits | 797,964 | 802,136 | 793,163 | 794,839 | 752,356 | |||||||||||||||||||||||||||||||||||
| Other Liabilities | 79,208 | 72,475 | 79,639 | 77,041 | 70,088 | |||||||||||||||||||||||||||||||||||
| Total Liabilities | 2,566,651 | 2,464,520 | 2,457,058 | 2,488,322 | 2,486,282 | |||||||||||||||||||||||||||||||||||
| SHAREOWNERS' EQUITY: | 278,489 | 278,943 | 277,407 | 279,532 | 277,464 | |||||||||||||||||||||||||||||||||||
| Total Liabilities and Shareowners' Equity | $ | 2,845,140 | $ | 2,743,463 | $ | 2,734,465 | $ | 2,767,854 | $ | 2,763,746 | ||||||||||||||||||||||||||||||
| Interest Rate Spread | $ | 20,006 | 3.14 | % | $ | 20,335 | 3.27 | % | $ | 19,603 | 3.15 | % | $ | 19,617 | 3.15 | % | $ | 19,421 | 3.14 | % | ||||||||||||||||||||
| Interest Income and Rate Earned(1) | 20,810 | 3.33 | 21,108 | 3.47 | 20,387 | 3.35 | 20,415 | 3.35 | 20,255 | 3.34 | ||||||||||||||||||||||||||||||
| Interest Expense and Rate Paid(2) | 804 | 0.13 | 773 | 0.13 | 784 | 0.13 | 798 | 0.13 | 834 | 0.14 | ||||||||||||||||||||||||||||||
| Net Interest Margin | $ | 20,006 | 3.21 | % | $ | 20,335 | 3.34 | % | $ | 19,603 | 3.23 | % | $ | 19,617 | 3.22 | % | $ | 19,421 | 3.20 | % | ||||||||||||||||||||
| (1) Interest and average rates are calculated on a tax-equivalent basis using the 35% Federal tax rate. | ||||||||||||||||||||||||||||||||||||||||
| (2) Rate calculated based on average earning assets. | ||||||||||||||||||||||||||||||||||||||||