Colony Bankcorp, Inc. · NYSE:CBAN
Colony Bankcorp — Q2 2021 Earnings Presentation
29 slides from Colony Bankcorp's earnings presentation, Jul 22, 2021
Slide 1: Investor Presentation Second Quarter 2021
1 INVESTOR PRESENTATION SECOND QUARTER - 2021
Slide 2: Forward-looking statements
2 This presentation contains "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 Colon
Slide 3: Non-GAAP Financial Measures
3 Statements included in this presentation include non-GAAP financial measures and should be read along with the accompanying tables, which provide a reconciliation of non-GAAP financial measure to GAAP financial measures. The non-GAAP financial measures used in this presentation include the followi
Slide 4: Company Profile
4 COMPANY PROFILE Locations ▪ Founded in 1975 ▪ Headquartered in Fitzgerald, Georgia ▪ $1.8 billion in assets at June 30, 2021 ▪ 29 locations in Georgia ▪ The seventh largest Georgia-based bank in the state as of March 31, 2021* ▪ Announced acquisition of SouthCrest Financial Group in April 2021. Wi
Slide 5: Leadership Team
5 Name Position Years In Banking Years With Colony T. Heath Fountain President and Chief Executive Officer 21 2 Edward "Lee" Bagwell EVP, Chief Risk Officer and General Counsel 18 18 Leonard H. “Lenny” Bateman EVP, Chief Credit Officer 25 2 Kimberly Dockery EVP, Chief Administrative Officer 15 2 Max
Slide 6: Driving High Performance: Strong Organic Growth
6 DRIVING HIGH PERFORMANCE ◦ Achieve strong organic growth each year • Proactive business development system • Increased accountability for loan and deposit production • Created incentive plans to motivate bankers • Retail marketing plan to grow deposits • Streamlined our consumer and commercial dep
Slide 7: Driving High Performance: Seize on Expansion Opportunities
7 DRIVING HIGH PERFORMANCE ◦ Achieve strong organic growth each year ◦ Seize on expansion opportunities • Announced acquisition of SouthCrest Financial in April 2021 for $84 million, expected to close by third quarter of 2021. • Acquisition provides entry into attractive Northern Georgia markets and
Slide 8: Proven Track Record of Franchise Enhancement
8 2020 2021 Note: Dollar values in thousands; Financial data as of December 31, 2020 1. 5-Year CAGR based on FY 2015 actuals to FY 2021 pro forma combined total assets 2. Pro forma FY 2021 total assets based on combined December 31, 2020 actuals; Excludes purchase accounting adjustments Source: S&P
Slide 9: SouthCrest Financial Opportunity
9 SOUTHCREST FINANCIAL OPPORTUNITY • Creates Georgia’s largest community bank and fourth largest bank in the State1 • Expands Colony into new markets • Enhanced scale, growth, profitability and performance • Significant revenue growth opportunities identified in the areas of mortgage, SBA and consum
Slide 10: SouthCrest Financial Opportunity: Pro Forma Footprint
10 Note: Dollar values in thousands unless otherwise noted; Financial data as of December 31, 2020 1. Community bank defined as having less than $10.0 billion in total assets as of December 31, 2020 2. Nonperforming Assets defined as the sum of nonaccrual loans, restructured loans, and other real es
Slide 11: Driving High Performance: Increase Operating Efficiency
11 DRIVING HIGH PERFORMANCE ◦ Achieve strong organic growth each year ◦ Seize on expansion opportunities ◦ Increase operating efficiency • Realignment plan with focus on operating expense savings of $1 million annually • Optimize our balance sheet for improved earnings • Improve processes for effici
Slide 12: Driving High Performance: Increase Non-Interest Income
12 DRIVING HIGH PERFORMANCE ◦ Increase non-interest income • Acquiring The Barnes Agency in August 2021 - forming Colony Insurance to offer consumer insurance solutions • Growing our deposit account customer base increases service charge and interchange revenue • Acquisition of PFB Mortgage added to
Slide 13: Colony Insurance
13 COLONY INSURANCE • Agreed to acquire The Barnes Agency, an Allstate appointed consumer property and casualty insurance agency in Macon, GA • Formed a new subsidiary, Colony Insurance, which will offer a suite of consumer insurance solutions • Named Jason Barnes President of Colony Insurance • Log
Slide 14: Mortgage Division
14 ◦ In May 2019, Colony Bank acquired PFB Mortgage, which had more than $100 million in annual mortgage production in 2019 • Added to our team by adding originators in Albany, Athens, Macon, Savannah, Statesboro and Warner Robins • Added seasoned mortgage executives through acquisition ◦ Increased
Slide 15: Small Business Specialty Lending Group
15 SMALL BUSINESS SPECIALTY LENDING GROUP ◦ In July 2019, opened a metro Atlanta office for Small Business Specialty Lending (SBSL) Group focused on Small Business Administration (SBA) lending and other government guaranteed loans ◦ 11 team members added, including three business development officer
Slide 16: Driving High Performance: Culture of High Performance
16 DRIVING HIGH PERFORMANCE ◦ Increase non-interest income ◦ Create a culture of high performance • Instill behaviors and habits that lead to great results • Coaching team members to improve performance • Increase incentive and performance based compensation • Pursue open communication and honest fe
Slide 17: Value Proposition to Our Customers
17 ◦ Since our founding in 1975, our mission is to provide an alternative to traditional banking that our customers deserve ◦ Focus on relationships that are beneficial to the customer and the Bank – one-sided relationships and transactions do not create value ◦ Strive to be trusted advisors and giv
Slide 18: Annual Financial Highlights
18 2016 2017 2018 2019 2020 Diluted earnings per share $ 0.84 $ 0.87 $ 1.4 $ 1.12 $ 1.24 Dividends per share $ — $ 0.1 $ 0.2 $ 0.3 $ 0.4 Return on average assets 0.62 % 0.63 % 0.99 % 0.72 % 0.7 % Return on average total equity 7.17 % 8.28 % 13.32 % 8.72 % 8.56 % Net interest margin 3.51 % 3.46 % 3.5
Slide 19: Financial Highlights
19 2Q2020 3Q2020 4Q2020 1Q2021 2Q2021 Diluted earnings per share $ 0.23 $ 0.33 $ 0.52 $ 0.52 $ 0.42 Adjusted earnings per diluted share (1) $ 0.25 $ 0.39 $ 0.44 $ 0.53 $ 0.49 Dividends per share $ 0.10 $ 0.10 $ 0.10 $ 0.10 $ 0.10 Return on average assets 0.52% 0.70% 1.08% 1.12% 0.91% Return on avera
Slide 20: Annual Balance Sheet Financial Highlights
20 2016 2017 2018 2019 2020 Total assets $ 1,210.4 $ 1,232.8 $ 1,251.9 $ 1,515.3 $ 1,763.9 Loans $ 754.3 $ 765.3 $ 782.4 $ 971.2 $ 1,062.8 Unearned income $ (0.4) $ (0.5) $ (0.5) $ (0.6) $ (2.4) Unamortized discount on acquired loans $ — $ — $ (0.3) $ (1.7) $ (0.9) Allowance for loan losses $ (8.9)
Slide 21: Balance Sheet Financial Highlights
21 2Q2020 3Q2020 4Q2020 1Q2021 2Q2021 Total assets $ 1,777.6 $ 1,759.4 $ 1,763.9 $ 1,799.0 $ 1,763.9 Loans $ 1,119.6 $ 1,112.6 $ 1,062.8 $ 1,064.2 $ 1,025.7 Unearned income $ (4.4) $ (3.8) $ (2.4) $ (3.4) $ (2.5) Unamortized discount on acquired loans $ (1.2) $ (1.2) $ (0.9) $ (0.7) $ (0.6) Allowanc
Slide 22: Shareholder Focused Dividend Policy
22 The current indicated annual rate is $0.41 per share, equating to a yield of 2.3%.(2) SHAREHOLDER FOCUSED DIVIDEND POLICY (1) The Board of Directors declared a dividend 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. (2)
Slide 23: Capital Ratios
23 CAPITAL RATIOS 10.2% 9.0% 9.6% 9.2% 8.5% 15.0% 12.5% 14.3% 12.4% 13.4% 15.9% 13.2% 15.4% 13.3% 14.6% 12.2% 10.3% 10.3% 10.3% 11.3% Tier One Leverage Ratio Tier One Ratio Total Risk-based Capital Ratio Common Equity Tier One Capital Ratio 2018 2019 2020 6/30/2020 6/30/2021
Slide 24: Solid Core Deposit Franchise
24 SOLID CORE DEPOSIT FRANCHISE As of June 30, 2021 Total Deposits: $1.54 billion MRQ Cost of Deposits: 0.22% Interest Bearing Demand, 33% Noninterest bearing demand, 26% Time deposits, 16% Savings and Money- markets, 25%
Slide 25: Loan Portfolio Breakdown
25 LOAN PORTFOLIO BREAKDOWN As of June 30, 2021 $1,022.7 million Real Estate 81% Consumer and Other 1.9% Commercial 15% Agriculture 2.3% $830.6 million Commercial real estate 55% Residential real estate 22% Construction 15% Farmland 8%
Slide 26: Loan Portfolio
26 LOAN PORTFOLIO(1) (Dollars in millions) Organic Loan Growth (Excluding PPP Loans) (1) Represents gross loan balances. Excludes PPP loans totaling $58.8 million, $102.6 million, $101.1 million $133.8 million, $133.2 million at 6/30/2021, 3/31/2021, 12/31/2020,9/30/2020 and 6/30/2020, respectively
Slide 27: Investment Considerations
27 ◦ SouthCrest acquisition to accelerate growth ◦ Well positioned for continued organic growth ◦ Improving earnings outlook ◦ Shareholder friendly dividend policy ◦ Opportunities created by industry consolidation ◦ Seasoned leadership with a proven track record INVESTMENT CONSIDERATIONS
Slide 28: Reconciliation of Non-GAAP Measures
28 RECONCILIATION OF NON-GAAP MEASURES (Dollars in thousands, except per share data) 2021 2020 (dollars in thousands, except per share data) Second Quarter First Quarter Fourth Quarter Third Quarter Second Quarter Operating net income reconciliation Net income (GAAP) $ 3,997 $ 4,919 $ 4,900 $ 3,098
Slide 29: Colony Bankcorp, Inc.
eS COLONY BANKCORP, INC. Right here with you. NASDAQ: CBAN