<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15 (D) OF THE SECURITIES
EXCHANGE ACT OF 1934
FOR QUARTER ENDED MARCH 31, 1998 COMMISSION FILE NUMBER 0-12436
COLONY BANKCORP, INC.
---------------------
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
GEORGIA 58-1492391
(STATE OF OTHER JURISDICTION) (I.R.S. EMPLOYER)
OF INCORPORATION OR ORGANIZATION IDENTIFICATION NUMBER
115 SOUTH GRANT STREET, FITZGERALD, GEORGIA 31750
-------------------------------------------------
ADDRESS OF PRINCIPAL EXECUTIVE OFFICES
912/426-6000
------------
REGISTRANT'S TELEPHONE NUMBER INCLUDING AREA CODE
INDICATE BY CHECK MARK WHETHER THE REGISTRANT (1) HAS FILED REPORTS REQUIRED TO
BE FILED BY SECTIONS 13 OR 15 (D) OF THE SECURITIES EXCHANGE ACT OF 1934 DURING
THE PRECEDING 12 MONTHS (OR FOR SUCH SHORTER PERIOD THAT THE REGISTRANT WAS
REQUIRED TO FILE SUCH REPORTS), AND (2) HAS BEEN SUBJECT TO SUCH FILING
REQUIREMENTS FOR THE PAST 90 DAYS.
YES X NO
----- -----
INDICATE THE NUMBER OF SHARES OUTSTANDING OF EACH OF THE ISSUER'S CLASSES OF
COMMON STOCK, AS OF THE CLOSE OF THE PERIOD COVERED BY THIS REPORT.
CLASS OUTSTANDING AT MARCH 31, 1998
----- -----------------------------
COMMON STOCK, $10 PAR VALUE 2,217,513
<PAGE>
PART 1 - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
- -----------------------------
THE FOLLOWING FINANCIAL STATEMENTS ARE PROVIDED FOR COLONY BANKCORP, INC. AND
SUBSIDIARIES: THE BANK OF FITZGERALD, ASHBURN BANK, COMMUNITY BANK OF WILCOX,
THE BANK OF DODGE COUNTY, THE BANK OF WORTH, COLONY BANK SOUTHEAST AND COLONY
MANAGEMENT SERVICES, INC.
A. CONSOLIDATED BALANCE SHEETS - MARCH 31, 1998 AND DECEMBER 31, 1997.
B. CONSOLIDATED STATEMENTS OF INCOME - FOR THE THREE MONTHS ENDED MARCH
31, 1998 AND 1997.
C. CONSOLIDATED STATEMENTS OF CHANGES IN FINANCIAL POSITION - FOR THE
THREE MONTHS ENDED MARCH 31, 1998 AND 1997.
THE CONSOLIDATED FINANCIAL STATEMENTS FURNISHED HAVE NOT BEEN EXAMINED BY
INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS, BUT REFLECT, IN THE OPINION OF
MANAGEMENT, ALL ADJUSTMENTS NECESSARY FOR A FAIR PRESENTATION OF THE RESULTS OF
OPERATIONS FOR THE PERIODS PRESENTED.
THE RESULTS OF OPERATIONS FOR THE THREE MONTH PERIOD ENDED MARCH 31, 1998 ARE
NOT NECESSARILY INDICATIVE OF THE RESULTS TO BE EXPECTED FOR THE FULL YEAR.
2
<PAGE>
COLONY BANKCORP, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
MARCH 31, 1998 AND DECEMBER 31, 1997
(UNAUDITED)
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
ASSETS MARCH 31, 1998 DECEMBER 31, 1997
-------------- -----------------
<S> <C> <C>
Cash and Balances Due from Depository
Institutions (Note 2) $ 13,164 $ 11,764
Federal Funds Sold 23,470 25,540
Investment Securities (Aggregate Fair Value
of $58,642 and $56,891 Respectively) (Note 3) 58,658 56,916
Loans (Notes 4 and 5) 237,381 234,299
Allowance for Loan Losses (4,743) (4,575)
Unearned Interest and Fees (9) (11)
--------- ---------
Total Loans 232,629 229,713
Premises and Equipment (Note 6) 9,693 9,135
Other Real Estate 841 1,311
Other Assets 6,333 8,568
--------- ---------
Total Assets $ 344,788 $342,947
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
Noninterest-Bearing $ 27,056 $ 27,320
Interest-Bearing (Note 8) 273,407 270,842
--------- ---------
Total Deposits 300,463 298,162
Borrowed Money:
Federal Funds Purchased 0 0
Other Borrowed Money (Note 9) 10,715 13,074
--------- ---------
Total Borrowed Money 10,715 13,074
Other Liabilities 2,877 2,890
Commitments and Contingencies (Note 11)
Stockholders' Equity:
Common Stock, Par Value $10 a Share; Authorized
5,000,000 shares, Issued 2,217,513 and 2,173,263
shares as of March 31, 1998 and December 31,
1997, Respectively 22,175 21,733
Paid-In Capital 1,580 1,137
Retained Earnings 7,128 6,083
Net Unrealized Loss on Securities Available for Sale,
Net of Tax Liability of $19 in 1998 and $25 in 1997 (150) (132)
--------- ---------
Total Stockholders' Equity 30,733 28,821
--------- ---------
Total Liabilities and Stockholders' Equity $ 344,788 $ 342,947
========= =========
</TABLE>
The accompanying notes are an integral part of these balance sheets.
3
<PAGE>
COLONY BANKCORP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
THREE MONTHS ENDED MARCH 31, 1998 AND 1997
(UNAUDITED)
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
Three Months Ended
March 31, 1998 March 31, 1997
-------------- --------------
<S> <C> <C>
Interest Income:
Loans, including fees $6,283 $5,726
Federal Funds Sold 295 213
Deposits with Other Banks 28 14
Investment Securities:
U.S. Treasury & Federal Agencies 723 879
State, County and Municipal 82 76
Other Investments 51 29
------ ------
Total Interest Income 7,462 6,937
------ ------
Interest Expense:
Deposits 3,477 3,193
Federal Funds Purchased 4 5
Other Borrowed Money 190 92
------ ------
Total Interest Expense 3,671 3,290
------ ------
Net Interest Income 3,791 3,647
Provision for Loan Losses 279 285
------ ------
Net Interest Income After Provision 3,512 3,362
------ ------
Noninterest Income:
Service Charge on Deposits 477 455
Other Service Charges, Commissions & Fees 117 135
Security Gains, net 2 7
Other Income 51 97
------ ------
Total Noninterest Income 647 694
------ ------
Noninterest Expense:
Salaries and Employee Benefits 1,262 1,266
Occupancy and Equipment 400 337
Other Operating Expenses 781 814
------ ------
Total Noninterest Expense 2,443 2,417
------ ------
Income Before Income Taxes $1,716 1,639
Income Taxes 549 518
------ ------
Net Income $1,167 $1,121
====== ======
Net Income Per Share of Common Stock*
Basic $ 0.53 $ 0.52
====== ======
Diluted $ 0.53 $ 0.52
====== ======
Weighted Average Shares Outstanding* 2,200,097 2,173,263
========= =========
</TABLE>
* All per share data has been adjusted to reflect a 3-for-2 stock split effected
as a 50% stock dividend on July 1, 1997
The accompanying notes are an integral part of these statements
4
<PAGE>
COLONY BANKCORP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
THREE MONTHS ENDED MARCH 31, 1998 AND 1997
(UNAUDITED)
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
1998 1997
---- ----
<S> <C> <C>
CASH FLOW FROM OPERATING ACTIVITIES
Net income (loss) $ 1,167 $ 1,121
Adjustments to reconcile net income to net cash provided
by operating activities:
(Gain) loss on sale of investment securities (2) (7)
Depreciation 227 171
Provision for loan losses 279 285
Amortization of excess costs 12 14
Other prepaids, deferrals and accruals, net 2,519 1,509
--------- ---------
Total Adjustments $ 3,035 $ 1,972
--------- ---------
Net cash provided by operating activities $ 4,202 $ 3,093
--------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of securities available for sale $(21,014) $ (6,783)
Proceeds from sales of securities available for sale 100 921
Proceeds from maturities, calls, and paydowns of
investment securities:
Available for Sale 18,987 5,563
Held to Maturity 186 73
Decrease (Increase) in interest-bearing deposits in banks (1,052) 0
(Increase) in loans (3,084) (11,306)
Purchase of premises and equipment (766) (676)
--------- ---------
Net cash (used in) investing activities $ (6,643) $(12,208)
--------- ---------
CASH FLOW FROM FINANCING ACTIVITIES
Net (decrease) increase in deposits $ 2,301 $ 2,547
Proceeds from issuance of common stock 885 0
Federal funds purchased 0 0
Dividends paid (109) (109)
Net (decrease) increase in other borrowed money (2,359) (61)
--------- ---------
Net cash provided by financing activities $ 718 $ 2,377
--------- ---------
Net increase (decrease) in cash and cash equivalents (1,723) (6,738)
Cash and cash equivalents at beginning of period 36,290 35,293
--------- ---------
Cash and cash equivalents at end of period $34,567 $28,555
</TABLE>
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.
5
<PAGE>
COLONY BANKCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in Thousands)
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
- ----------------------------------------------
BASIS OF PRESENTATION
Colony Bankcorp, Inc. is a multi-bank holding company located in Fitzgerald,
Georgia. The consolidated financial statements include the accounts of Colony
Bankcorp, Inc. and its wholly-owned subsidiaries, The Bank of Fitzgerald,
Fitzgerald, Georgia; Ashburn Bank, Ashburn, Georgia; Bank of Worth, Sylvester,
Georgia; The Bank of Dodge County, Eastman, Georgia; Community Bank of Wilcox,
Pitts, Georgia,; Colony Bank Southeast (formerly Broxton State Bank), Broxton,
Georgia; and Colony Management Services, Inc., Fitzgerald, Georgia (the Banks).
All significant intercompany accounts have been eliminated in consolidation. The
accounting and reporting policies of Colony Bankcorp, Inc. conform to generally
accepted accounting principles and practices utilized in the commercial banking
industry.
In preparing the financial statements, management is required to make estimates
and assumptions that affect the reported amounts of assets and liabilities as of
the balance sheet date and revenues and expenses for the period. Actual results
could differ significantly from those estimates. Material estimates that are
particularly susceptible to significant change in the near-term relate to the
determination of the allowance for loan losses, the valuation of real estate
acquired in connection with foreclosures or in satisfaction of loans and the
valuation of deferred tax assets.
In February, 1997, the Financial Accounting Standards Board (FASB) issued
Statement No. 128, Earnings Per Share (SFAS 128). SFAS 128 replaced the
calculation of primary and fully diluted earnings per share (EPS) with basic and
diluted EPS. Unlike primary EPS basic EPS excludes any dilutive effects of
options, warrants and convertible securities. Diluted EPS is very similar to
fully diluted EPS. All EPS amounts presented have been restated as applicable,
to conform with the new requirements.
INVESTMENT SECURITIES
The Company records investment securities under Statement of Financial
Accounting Standards (SFAS) No. 115 Accounting for Certain Investments in Debt
and Equity Securities. Under the provisions of SFAS No. 115, the Company must
classify its securities as trading, available for sale or held to maturity.
Trading securities are purchased and held for sale in the near term. Securities
held to maturity are those which the Company has the ability and intent to hold
until maturity. All other securities not classified as trading or held to
maturity are considered available for sale.
Securities available for sale are measured at fair value with unrealized gains
and losses reported net of deferred taxes as a separate component of
stockholders' equity. Fair value represents an approximation of realizable value
as of March 31, 1998 and December 31, 1997. Realized and unrealized gains and
losses are determined using the specific identification method. Premiums and
discounts are recognized in interest income using the interest method over the
period to maturity.
LOANS
Loans are generally reported at principal amount less unearned interest and
fees. Impaired loans are recorded under SFAS 114, Accounting by Creditors for
Impairment of a Loan and SFAS 118, Accounting by Creditors for Impairment of a
Loan-Income Recognition and Disclosures. Impaired loans are loans for which
principal and interest are unlikely to be collected in accordance with the
original loan terms and, generally, represent loans delinquent in excess of 120
days which have been placed on nonaccrual status and for which collateral values
are less than outstanding principal and interest. Small balance, homogeneous
loans are excluded from impaired loans. Generally, interest payments received on
impaired loans are applied to principal. Upon receipt of all loan principal,
additional interest payments are recognized as interest income on the cash
basis.
Other nonaccrual loans are loans for which payments of principal and interest
are considered doubtful of collection under original terms but collateral values
equal or exceed outstanding principal and interest.
6
<PAGE>
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Colony Bankcorp, Inc.'s loans consist of commercial, financial and agricultural
loans, real estate mortgage loans and consumer loans primarily to individuals
and entities located throughout central and south Georgia. Accordingly, the
ultimate collectability of the loans is largely dependent upon economic
conditions in the central and south Georgia area.
ALLOWANCE FOR LOAN LOSSES
The allowance method is used in providing for losses on loans. Accordingly, all
loan losses decrease the allowance and all recoveries increase it. The provision
for loan losses is based on factors which, in management's judgment, deserve
current recognition in estimating possible loan losses. Such factors considered
by management include growth and composition of the loan portfolio, economic
conditions and the relationship of the allowance for loan losses to outstanding
loans.
An allowance for loan losses is maintained for all impaired loans. Provisions
are made for impaired loans upon changes in expected future cash flows or
estimated net realizable value of collateral. When determination is made that
impaired loans are wholly or partially uncollectible, the uncollectible portion
is charged off.
Management believes the allowance for possible loan losses is adequate. While
management uses available information to recognize losses on loans, future
additions to the allowance may be necessary based on changes in economic
conditions. In addition, various regulatory agencies, as an integral part of
their examination process, periodically review the Company's allowance for loan
losses. Such agencies may require the Company to recognize additions to the
allowance based on their judgment about information available to them at the
time of their examination.
PREMISES AND EQUIPMENT
Premises and equipment are recorded at acquisition cost net of accumulated
depreciation.
Depreciation is charged to operations over the estimated useful lives of the
assets. The estimated useful lives and methods of depreciation are as follows:
<TABLE>
<CAPTION>
DESCRIPTION LIFE IN YEARS METHOD
----------- ------------- ------
<S> <C> <C>
Banking Premises 15-40 Straight-Line and Accelerated
Furniture and Equipment 5-10 Straight-Line and Accelerated
</TABLE>
Expenditures for major renewals and betterments are capitalized. Maintenance and
repairs are charged to operations as incurred. When property and equipment are
retired or sold, the cost and accumulated depreciation are removed from the
respective accounts and any gain or loss is reflected in other income or
expense.
CASH FLOWS
For reporting cash flows, cash and cash equivalents include cash on hand,
noninterest-bearing amounts due from banks and federal funds sold. Cash flows
from demand deposits, NOW accounts, savings accounts, loans and certificates of
deposit are reported net.
INCOME TAXES
Income taxes are provided for the tax effects of transactions reported in the
consolidated financial statements and consist of taxes currently due plus
deferred taxes. Deferred taxes are recognized for differences between the basis
of assets and liabilities for financial statement and income tax purposes. The
differences relate primarily to depreciable assets (use of different
depreciation methods for financial statement and income tax purposes) and
allowance for loan losses (use of the allowance method for financial statement
purposes and the experience method for tax purposes). The deferred tax assets
and liabilities represent the future tax return consequences of those
differences, which will either be taxable or deductible when the assets and
liabilities are recovered or settled.
7
<PAGE>
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
OTHER REAL ESTATE
Other real estate generally represents real estate acquired through foreclosure
and is initially recorded at the lower of cost or estimated market value at the
date of acquisition. Losses from the acquisitions of property in full or partial
satisfaction of debt are recorded as loan losses. Subsequent declines in value,
routine holding costs and gains or losses upon disposition are included in other
losses.
(2) CASH AND BALANCES DUE FROM DEPOSITORY INSTITUTIONS
- ------------------------------------------------------
Components of cash and balances due from depository institutions at March 31,
1998 and December 31, 1997 are as follows:
<TABLE>
<CAPTION>
March 31, 1998 December 31, 1997
-------------- -----------------
<S> <C> <C>
Cash on Hand and Cash Items $ 3,069 $ 3,211
Noninterest-Bearing Deposits with Other Banks 8,028 7,538
Interest-Bearing Deposits with Other Banks 2,067 1,015
------- -------
$13,164 $11,764
======= =======
</TABLE>
(3) INVESTMENT SECURITIES
- -------------------------
Investment securities as of March 31, 1998 are summarized as follows:
<TABLE>
<CAPTION>
Gross Gross
Amortized Unrealized Unrealized Fair
Cost Gains Losses Value
<S> <C> <C> <C> <C>
Securities Available for Sale:
U.S. Treasury $ 1,089 $ -0- $ (2) $ 1,087
U.S. Government Agencies:
Mortgage-Backed 10,759 65 (28) 10,796
Other 34,595 25 (76) 34,544
State, County & Municipal 6,308 74 (2) 6,380
The Banker's Bank Stock 50 -0- -0- 50
Federal Home Loan Bank Stock 1,799 -0- -0- 1,799
Marketable Equity Securities 1,130 -0- (187) 943
------- ----- ----- -------
$55,730 $ 164 $(295) $55,599
======= ===== ===== =======
Securities Held to Maturity:
U.S. Government Agencies $ 1,550 $ -0- $ (3) $ 1,547
State, County and Municipal 1,509 4 (17) 1,496
------- ----- ----- -------
$ 3,059 $ 4 $ (20) $ 3,043
======= ===== ===== =======
</TABLE>
8
<PAGE>
(3) INVESTMENT SECURITIES (CONTINUED)
- -------------------------------------
The amortized cost and fair value of investment securities as of March 31, 1998
by contractual maturity, are shown below. Expected maturities will differ from
contractual maturities because issuers have the right to call or prepay
obligations with or without call or prepayment penalties.
<TABLE>
<CAPTION>
SECURITIES
AVAILABLE FOR SALE HELD TO MATURITY
AMORTIZED FAIR AMORTIZED FAIR
COST VALUE COST VALUE
<S> <C> <C> <C> <C>
Due in One Year or Less $ 8,989 $ 8,986 $1,815 $1,813
Due After One Year Through Five Years 28,753 28,745 810 810
Due After Five Years Through Ten Years 4,250 4,280 0 0
Due After Ten Years 0 0 434 420
------- ------- ------ ------
41,992 42,011 3,059 3,043
Federal Home Loan Bank Stock 1,799 1,799
The Banker's Bank Stock 50 50
Marketable Equity Securities 1,130 943
Mortgage-Backed Securities 10,759 10,796
------- ------- ------ ------
$55,730 $55,599 $3,059 $3,043
======= ======= ====== ======
</TABLE>
Investment securities as of December 31, 1997 are summarized as follows:
<TABLE>
<CAPTION>
Gross Gross
Amortized Unrealized Unrealized Fair
Cost Gains Losses Value
<S> <C> <C> <C> <C>
Securities Available for Sale:
U.S. Treasury $ 1,074 $ 0 $ (3) $ 1,071
U.S. Government Agencies
Mortgage-Backed Securities 10,866 60 (62) 10,864
Other 33,468 41 (43) 33,466
State, County & Municipal 5,328 85 (5) 5,408
The Banker's Bank Stock 50 0 50
Federal Home Loan Bank Stock 1,870 0 1,870
Marketable Equity Securities 1,130 0 (181) 949
-------- ------ ------- -------
$ 53,786 $ 186 $ (294) $53,678
======== ====== ======= =======
Securities Held to Maturity:
U.S. Government and Agencies $ 1,649 $ 0 $ (5) $ 1,644
State, County and Municipal 1,588 1 (20) 1,569
-------- ------ ------- -------
$ 3,237 $ 1 $ (25) $ 3,213
======== ====== ======= =======
</TABLE>
Investment securities having a carrying value approximating $20,279 and $25,563
as of March 31, 1998 and December 31, 1997, respectively, were pledged to secure
public deposits and for other purposes.
9
<PAGE>
(4) LOANS
- ---------
The composition of loans as of March 31, 1998 and December 31, 1997 was as
follows:
<TABLE>
<CAPTION>
March 31, 1998 December 31, 1997
-------------- -----------------
<S> <C> <C>
Commercial, Financial and Agricultural $ 46,734 $ 34,883
Real Estate - Construction 1,128 2,676
Real Estate - Farmland 16,434 21,898
Real Estate - Other 123,396 117,268
Installment Loans to Individuals 40,724 42,956
All Other Loans 8,965 14,618
-------- --------
$237,381 $234,299
======== ========
</TABLE>
Nonaccrual loans are loans for which principal and interest are doubtful of
collection in accordance with original loan terms and for which accruals of
interest have been discontinued due to payment delinquency. Nonaccrual loans
totaled $6,290 and $5,774 as of March 31, 1998 and December 31, 1997,
respectively. On March 31, 1998, the Company had 90 day past due loans with
principal balances of $1,108 and restructured loans with principal balances of
$48.
Colony Bankcorp, Inc. recognizes impaired loans as nonaccrual loans delinquent
in excess of 120 days for which collateral values are insufficient to recover
outstanding principal and interest under original loan terms. Impaired loan data
as of March 31, 1998 and December 31, 1997 was as follows:
Total Investment in Impaired Loans $1,292
Less Allowance for Impaired Loan Losses (461)
------
Net Investment, March 31, 1998 and December 31, 1997 $ 831
======
(5) ALLOWANCE FOR LOAN LOSSES
- -----------------------------
Transactions in the allowance for loan losses are summarized below for three
months ended March 31, 1998 and March 31, 1997 was as follows:
<TABLE>
<CAPTION>
March 31, 1998 March 31, 1997
-------------- --------------
<S> <C> <C>
Balance, Beginning $4,575 $4,434
Provision Charged to Operating Expenses 279 285
Loans Charged Off (196) (274)
Loan Recoveries 85 124
------ ------
Balance, Ending $4,743 $4,569
====== ======
</TABLE>
10
<PAGE>
(6) PREMISES AND EQUIPMENT
- --------------------------
Premises and equipment are comprised of the following as of March 31, 1998 and
December 31, 1997:
<TABLE>
<CAPTION>
March 31, 1998 December 31, 1997
-------------- -----------------
<S> <C> <C>
Land $ 1,306 $ 1,306
Building 7,195 6,717
Furniture, Fixtures and Equipment 6,227 5,938
Leasehold Improvements 180 180
------- -------
14,908 14,141
Accumulated Depreciation (5,215) (5,006)
------- -------
$ 9,693 $ 9,135
======= =======
</TABLE>
Certain Company facilities and equipment are leased under various operating
leases. Future minimum rental payments to be paid are as follows:
Year Ending
December 31 Amount
----------- --------
1998 $ 62,249
1999 57,740
2000 54,180
2001 45,644
2002 6,708
--------
$226,521
========
(7) INCOME TAXES
- ----------------
The Company records income taxes under SFAS No. 109, Accounting for Income
Taxes, which requires an asset and liability approach to financial accounting
and reporting for income taxes. Deferred income tax assets and liabilities are
computed annually for differences between the financial statement and tax bases
of assets and liabilities that will result in taxable or deductible amounts in
the future based on enacted tax laws and rates applicable to the periods in
which the differences are expected to affect taxable income. Valuation
allowances are established when necessary to reduce deferred tax assets to the
amount expected to be realized. Income tax expense is the tax payable or
refundable for the period plus or minus the change during the period in deferred
tax assets and liabilities.
(8) DEPOSITS
- ------------
Components of interest-bearing deposits as of March 31, 1998 and December 31,
1997 are as follows:
<TABLE>
<CAPTION>
March 31, 1998 December 31, 1997
-------------- -----------------
<S> <C> <C>
Interest-Bearing Demand $ 53,266 $ 54,770
Savings 12,314 11,971
Time, $100,000 and Over 65,399 61,198
Other Time 142,428 142,903
-------- --------
$273,407 $270,842
======== ========
</TABLE>
The aggregate amount of short-term jumbo certificates of deposit, each with a
minimum denomination of $100,000, was approximately $55,267 and $51,608 as of
March 31, 1998 and December 31, 1997, respectively.
11
<PAGE>
(8) DEPOSITS (CONTINUED)
- ------------------------
As of March 31, 1998, the scheduled maturities of certificates of deposit are as
follows:
<TABLE>
<CAPTION>
Maturity Amount
-------- ------
<S> <C>
One Year and Under $170,077
One to Three Years 26,536
Three Years and Over 11,214
--------
$207,827
========
</TABLE>
(9) OTHER BORROWED MONEY
- ------------------------
Other borrowed money at March 31, 1998 and December 31, 1997 is summarized as
follows:
<TABLE>
<CAPTION>
March 31, 1998 December 31, 1997
-------------- -----------------
<S> <C> <C>
Federal Home Loan Bank Advances $ 8,400 $ 9,800
Debentures Payable 534 534
AmSouth Note Payable 0 821
First Port City Note Payable 867 963
The Bankers Bank Note Payable 914 956
------- -------
$10,715 $13,074
======= =======
</TABLE>
Advances from the Federal Home Loan Bank (FHLB) have maturities ranging from
1998 to 20008 and interest rates ranging from 5.35 percent to 6.98 percent. Of
the balances outstanding at March 31, 1998, $1,000 is callable by the FHLB
during 1999 and $3,000 is callable by the FHLB during 2003. Under the Blanket
Agreement for Advances and Security Agreement with the FHLB, residential
mortgage loans are pledged as collateral for the FHLB advances outstanding.
Debentures payable were issued November 28, 1984 for $4,360. The debentures are
due in annual payments of $267 plus variable interest with the unpaid balance
due November 1, 1999. Collateral for the outstanding debt consists of 100
percent of the common stock of Ashburn Bank. Effective interest rate at March
31, 1998 was 8.0 percent.
AmSouth note payable originated on December 20, 1994 for $1,445. Collateral
consists of 100 percent of the common stock of The Bank of Fitzgerald and The
Bank of Worth. This debt was paid out in February, 1998.
First Port City note payable was renewed on January 30, 1997 with additional
funds added for an amount totaling $963. Annual principal payments of $96 are
due with interest paid quarterly at The Wall Street Prime Rate Indicator. The
debt is secured by commercial real estate in downtown Fitzgerald, which includes
the parent company's facilities. Any unpaid balance is due January 29, 2000.
The Bankers Bank note payable originated on September 5, 1997 for $1,000 at a
rate of The Wall Street Prime minus one half percent. Payments are due monthly
with the entire unpaid balance due September 5, 2002. The debt is secured by all
furniture, fixtures, machinery, equipment and software of Colony Managements
Services, Inc. Colony Bankcorp, Inc. guarantees the debt.
The aggregate stated maturities of other borrowed money at March 31, 1998 are as
follows:
<TABLE>
<CAPTION>
Year Amount
<S> <C>
1998 $ 3,064
1999 564
2000 873
2001 200
2002 and Thereafter 6,014
-------
$10,715
=======
</TABLE>
12
<PAGE>
(10) PROFIT SHARING PLAN
- ------------------------
The Company has a profit sharing plan that covers substantially all employees
who meet certain age and service requirements. It is the Company's policy to
make contributions to the plan as approved annually by the board of directors.
The total provision for contributions to the plan was $295,452 for 1997.
(11) COMMITMENTS AND CONTINGENCIES
- ----------------------------------
In the normal course of business, certain commitments and contingencies are
incurred which are not reflected in the consolidated financial statements. The
Bank had commitments under standby letters of credit to U.S. addresses
approximating $1,111 as of March 31, 1998 and $825 as of December 31, 1997.
Unfulfilled loan commitments as of March 31, 1998 and December 31, 1997
approximated $41,741 and $30,197 respectively. No losses are anticipated as a
result of commitments and contingencies.
Commitments generally have fixed expiration dates or other termination clauses
and may require payment of a fee. Since many of the commitment amounts expire
without being drawn upon, the total commitment amounts do not necessarily
represent future cash requirements. The credit risk involved in issuing these
financial instruments is essentially the same as that involved in extending
loans to customers. The amount of collateral obtained, if deemed necessary by
the Banks upon extension of credit, is based on management's credit evaluation
of the borrower. Collateral held varies, but may include accounts receivable,
inventory, property, plant and equipment and income-producing commercial
properties.
The Banks do not anticipate any material losses as a result of the commitments
and contingent liabilities.
The nature of the business of the Banks is such that it ordinarily results in a
certain amount of litigation. In the opinion of management and counsel for the
company and the Banks, there is no litigation in which the outcome will have a
material effect on the consolidated financial statements.
(12) REGULATORY CAPITAL MATTERS
- -------------------------------
The amount of dividends payable to the parent company from the subsidiary banks
is limited by various banking regulatory agencies. The amount of cash dividends
available from subsidiaries for payment in 1998 without prior approval from the
banking regulatory agencies approximates $2,017. Upon approval by regulatory
authorities, the banks may pay cash dividends to the parent company in excess of
regulatory limitations.
The Company is subject to various regulatory capital requirements administered
by the federal banking agencies. Failure to meet minimum capital requirements
can initiate certain mandatory and, possibly, additional discretionary actions
by regulators that, if undertaken, could have a direct material effect on the
Company's financial statements. Under capital adequacy guidelines and the
regulatory framework for prompt corrective action, the Company must meet
specific capital guidelines that involve quantitative measures of the Company's
assets, liabilities and certain off-balance sheet items as calculated under
regulatory accounting practices. The Company's capital amounts and
classifications are also subject to qualitative judgments by the regulators
about components, risk weightings and other factors.
Quantitative measures established by regulation to ensure capital adequacy
require the Company to maintain minimum amounts and ratios of total and Tier 1
capital to risk-weighted assets, and of Tier 1 capital to average assets. The
amounts and ratios as defined in regulations are presented hereafter. Management
believes, as of March 31, 1998, the Company meets all capital adequacy
requirements to which it is subject and is classified as well capitalized under
the regulatory framework for prompt corrective action. In the opinion of
management, there are no conditions or events since prior notification of
capital adequacy from the regulators that have changed the institution's
category.
13
<PAGE>
(12) REGULATORY CAPITAL MATTERS (CONTINUED)
- -------------------------------------------
<TABLE>
<CAPTION>
TO BE WELL CAPITALIZED
FOR CAPITAL UNDER PROMPT CORRECTIVE
ACTUAL ADEQUACY PURPOSES ACTION PROVISIONS
AMOUNT RATIO AMOUNT RATIO AMOUNT RATIO
<S> <C> <C> <C> <C> <C> <C>
AS OF MARCH 31, 1998
Total Capital
to Risk-Weighted Assets $33,367 13.26% $20,124 8.00% $25,155 10.00%
Tier 1 Capital
to Risk-Weighted Assets 30,203 12.01% 10,062 4.00% 15,093 6.00%
Tier 1 Capital
to Average Assets 30,203 8.91% 13,563 4.00% 16,954 5.00%
AS OF DECEMBER 31, 1997
Total Capital
to Risk-Weighted Assets $31,424 12.50% $20,111 8.00% $25,139 10.00%
Tier 1 Capital
to Risk-Weighted Assets 28,265 11.25% 10,050 4.00% 15,075 6.00%
Tier 1 Capital
to Average Assets 28,265 8.44% 13,396 4.00% 16,745 5.00%
</TABLE>
(13) FINANCIAL INFORMATION OF COLONY BANKCORP, INC. (PARENT ONLY)
- ------------------------------------------------------------------
The parent company's balance sheets as of March 31, 1998 and December 31, 1997
and the related statements of income are as follows:
COLONY BANKCORP, INC. (PARENT ONLY)
BALANCE SHEETS
FOR PERIOD ENDED MARCH 31, 1998 AND DECEMBER 31, 1997
<TABLE>
<CAPTION>
ASSETS MARCH 31, 1998 DECEMBER 31, 1997
<S> <C> <C>
Cash $ 104 $ 9
Investments in Subsidiaries at Equity 30,661 29,787
Other 1,485 1,534
------- -------
Total Assets $32,250 $31,330
======= =======
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities
Dividends Payable $ 122 $ 109
Notes and Debentures Payable 1,400 2,318
Other (5) 82
------- -------
1,517 2,509
Stockholders' Equity
Common Stock, Par Value $10; 5,000,000 Shares
Authorized, 2,217,513 and 2,173,263 Shares Issued
and Outstanding as of March 31, 1998 and
December 31, 1997, respectively $22,175 $21,733
Paid-In Capital 1,580 1,137
Retained Earnings 7,128 6,083
Net Unrealized Loss on Securities Available for Sale, Net of Tax (150) (132)
------- -------
Total Stockholders' Equity 30,733 28,821
------- -------
Total Liabilities and Stockholders' Equity $32,250 $31,330
======= =======
</TABLE>
14
<PAGE>
(13) FINANCIAL INFORMATION OF COLONY BANKCORP, INC. (PARENT ONLY) (CONTINUED)
- -----------------------------------------------------------------------------
COLONY BANKCORP, INC. (PARENT ONLY)
STATEMENT OF INCOME
FOR THE THREE MONTHS ENDED MARCH 31, 1998 AND MARCH 31, 1997
<TABLE>
<CAPTION>
March 31, 1998 March 31, 1997
<S> <C> <C>
INCOME
Dividends from Subsidiaries $ 375 $ 287
Management Fees from Subsidiaries 44 81
Other 23 10
------ ------
$ 442 $ 378
EXPENSES
Interest $ 37 $ 44
Salaries and Benefits 73 93
Other 96 75
------ ------
$ 206 $ 212
------ ------
INCOME BEFORE TAXES AND EQUITY IN UNDISTRIBUTED
EARNINGS OF SUBSIDIARIES 236 166
Income Tax (Benefits) 38 47
------ ------
INCOME BEFORE EQUITY IN UNDISTRIBUTED EARNINGS
OF SUBSIDIARIES 274 213
Equity in Undistributed Earnings of Subsidiaries 893 908
------ ------
Net Income $1,167 $1,121
====== ======
</TABLE>
COLONY BANKCORP, INC. (PARENT ONLY)
STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 1998 AND MARCH 31, 1997
<TABLE>
<CAPTION>
MARCH 31, 1998 MARCH 31, 1997
<S> <C> <C>
Cash Flows from Operating Activities
Net Income $1,167 $1,121
Adjustments to Reconcile Net Income to Net
Cash Provided from Operating Activities
Depreciation and Amortization 17 10
Equity in Undistributed Earnings of Subsidiary (893) (908)
Other (50) (72)
------ ------
241 151
Cash Flows from Investing Activities
Capital Infusion in Subsidiary 0 0
Purchase of Premises and Equipment (4) (172)
------ ------
(4) (172)
Cash Flows from Financing Activities
Dividends Paid (109) (109)
Proceeds from Issuance of Common Stock 885 0
Principal Payments on Notes and Debentures (918) (52)
Proceeds from Notes and Debentures 0 172
------ ------
(142) 11
Increase (Decrease) in Cash and Cash Equivalents 95 (10)
Cash and Cash Equivalents, Beginning 9 61
------ ------
Cash and Cash Equivalents, Ending $ 104 $ 51
====== ======
</TABLE>
15
<PAGE>
(14) COMMON STOCK SPLIT
- -----------------------
On May 16, 1995, the board of directors approved a 100 percent stock split to be
effected on July 1, 1995 in the form of a dividend to stockholders of record on
June 30, 1995. On February 18, 1997 a 50 percent stock split effected on July 1,
1997 in the form of a dividend was approved by the board. Weighted average
shares and per share data for all periods presented in the accompanying
consolidated financial statements and related notes have been retroactively
restated to reflect the additional shares outstanding resulting from the stock
split.
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATION
LIQUIDITY AND CAPITAL RESOURCES
Liquidity represents the ability to provide adequate sources of funds for
funding loan commitments and investment activities, as well as the ability to
provide sufficient funds to cover deposit withdrawals, payment of debt and
financing of operations. These funds are obtained by converting assets to cash
(representing primarily proceeds from collections on loans and maturities of
investment securities) or by attracting and obtaining new deposits. For the
three months ended March 31, 1998, the Company was successful in meeting its
liquidity needs by increasing deposits 0.77% to $300,463,000 from deposits of
$298,162,000 on December 31, 1997 and by reducing Federal Funds 8.10% to
$23,470,000 from $25,540,000 on December 31, 1997. Should the need arise, the
Company also maintains relationships with several correspondent banks that can
provide funds on short notice.
The Company's liquidity position remained acceptable for the three months ended
March 31, 1998. Average liquid assets (cash and amounts due from banks,
interest-bearing deposits in other banks, funds sold and investments securities)
represented 30.57% of average deposits for three months ended March 31, 1998 as
compared to 32.68% of average deposits for three months ended March 31, 1997 and
29.73% for calendar year 1997. Average loans represented 79.43% of average
deposits for three months ended March 31, 1998 as compared to 74.92% for three
months ended March 31, 1997 and 80.00% for calendar year 1997. Average interest-
bearing deposits were 85.13% of average earning assets for three months ended
March 31, 1998 as compared to 86.89% for three months ended March 31, 1997 and
84.92% for calendar year 1997.
The Company satisfies most of its capital requirements through retained
earnings. During the first three months of 1998, retained earnings provided
$1,045,000 of increase in equity. Additionally, equity capital decreased by
$18,000 during the first three months of 1998 as a result of changes in
unrealized losses on securities available-for-sale, net of taxes. Additionally,
the Company realized $885,000 in proceeds from the sale of common stock through
a public offering that was completed during the first quarter. Thus, total
equity increased by a net amount of $1,912,000 for the three month period ended
March 31, 1998. This compares to growth in equity of $1,012,000 from retained
earnings and $221,000 decrease resulting from changes in unrealized losses on
securities, or total equity increase of $791,000 for the three month period
ended March 31, 1997. Total equity increased by a net amount of $3,230,000 in
1997.
At March 31, 1998, total capital of Colony amounted to approximately
$30,733,000. At March 31, 1998, there was an outstanding commitment for capital
expenditures of approximately $1,000,000 for construction and furnishings for
two branch offices to be located in Douglas and Leesburg, Georgia.
The Federal Reserve Bank Board and the FDIC have issued capital guidelines for
U.S. banking organizations. The objective of these efforts was to provide a more
uniform capital framework that is sensitive to differences in risk assets among
banking organizations. The guidelines define a two-tier capital framework. Tier
1 capital consists of common stock and qualifying preferred stockholder's equity
less goodwill. Tier 2 capital consists of certain convertible,
16
<PAGE>
subordinated and other qualifying term debt and the allowance for loan losses up
to 1.25 percent of risk-weighted assets. The Company has no Tier 2 capital other
than the allowance for loan losses.
Using the capital requirements presently in effect, the Tier 1 ratio at March
31, 1998 was 12.01% and total Tier 1 and 2 risk-based capital was 13.26%. Both
of these measures compare favorably with the regulatory minimums of 4% for Tier
1 and 8% for total risk-based capital. The Company's leverage ratio at March 31,
1998 was 8.91% which exceeds the required leverage ratio standard of 4%.
For the first quarter of 1998, the Company paid quarterly dividends of $0.055
per share. The dividend payout ratio, defined as dividends per share divided by
net income per share, was 10.38% for three months ended March 31, 1998 as
compared to $0.05 quarterly dividends for the three months ended March 31, 1997
and a dividend payout ratio of 9.62%.
At March 31, 1998, management was not aware of any recommendations by regulatory
authorities which, if they were to be implemented, would have a material effect
on the Company's liquidity, capital resources or operations. However, it is
possible that examinations by regulatory authorities in the future could
precipitate additional loan charge-offs which could materially impact the
Company's liquidity, capital resources and operations.
RESULTS OF OPERATION
The Company's results of operations are determined by its ability to effectively
manage interest income and expense, to minimize loan and investment losses, to
generate noninterest income and to control noninterest expense. Since interest
rates are determined by market forces and economic conditions beyond the control
of the Company, the ability to generate net interest income is dependent upon
the Bank's ability to obtain an adequate spread between the rate earned on
earning assets and the rate paid on interest-bearing liabilities. Thus, the key
performance measure for net interest income is the interest margin or net yield,
which is taxable-equivalent net interest income divided by average earning
assets.
NET INCOME
- ----------
Net income for the three months ended March 31, 1998 was $1,167,000 as compared
to $1,121,000 for the three months ended March 31, 1997, or an increase of
4.10%. First quarter 1998 earnings were relatively stable compared to first
quarter 1997.
NET INTEREST MARGIN
- -------------------
The net interest margin decreased by 15 basis points to 4.87% in first quarter
1998 as compared to 5.02% in first quarter 1997. This decrease in our net
interest margin was offset by an increase in average earnings assets as the net
interest income increased by 3.95% to $3,791,000 in first quarter 1998 from
$3,647,000 for the same period in 1997. Average earning assets increased to
$316,121,000 in first quarter 1998 from $293,697,000 in first quarter 1997.
Average loans increased by $24,742,000 or 11.72%, average investment securities
decreased by $8,508,000 or 14.94%, average Federal funds increased by $5,268,000
or 32.67% and average interest bearing deposits in other banks increased by
$922,000 or 95.05%, resulting in a net increase in average earning assets of
$22,424,000.
The net increase in average earning assets was funded by a net increase in
average deposits of 5.38% to $297,006,000 for first quarter 1998 from
$281,835,000 for first quarter 1997. Average interest-bearing deposits increased
by 5.52% to $269,183,000 at March 31, 1998 compared to $255,105,000 at March 31,
1997, while average noninterest-bearing deposits represented 9.49% of average
total deposits at March 31, 1998 compared to 9.45% at March 31, 1997 and 9.46%
for calendar year 1997.
Interest expense increased for the three months ended March 31, 1998 by $381,000
compared to the same period in 1997. The increase is primarily attributable to
the increase in average interest-bearing deposits to $269,183,000 at March 31,
1998 compared to $255,105,00 at March 31, 1997. The combination of the increased
average earnings assets, increased average interest-bearing deposits and
decreased net interest margin resulted in an increase of net interest income of
$144,000 for the three months ended March 31, 1998 compared to the same period
in 1997.
17
<PAGE>
PROVISION FOR LOAN LOSSES
- -------------------------
The allowance for loan losses represents a reserve for potential losses in the
loan portfolio. The adequacy of the allowance for loan losses is evaluated
periodically based on a review of all significant loans, with a particular
emphasis on non-accruing, past due and other loans that management believes
requires attention.
The provision for loan losses is a charge to earnings in the current period to
replenish the allowance for loan losses and maintain it at a level management
had determined to be adequate. The provision for loan losses was $279,000 for
the three months ended March 31, 1998 as compared to $285,000 for the three
months ended March 31, 1997, representing a decrease in the provision of $6,000
or 2.10%. The decrease in the provision for loan losses during the first quarter
of 1998 was attributable to a leveling off of problem loans and an adequate
build-up in the loan loss reserve for any future losses. Net loan charge-offs
represented 40.14% of the provision for loan losses in the first quarter 1998 as
compared to 52.63% in the first quarter of 1997. Net loan charge-offs for the
three months ended March 31, 1998 were 0.05% of average loans, down from 0.07%
for the same period last year, reflecting the continuing emphasis by management
on high credit quality and credit management. At March 31, 1998 the allowance
for loan losses was 2.00% to total loans outstanding as compared to an allowance
for loan losses of 2.09% at March 31, 1997 and 1.95% at December 31, 1997. The
allowance for loan losses of 2.00% of total loans provided coverage of 63.80% of
nonperforming loans and 57.32% of nonperforming assets, compared to 66.62% and
54.82% in the first quarter of 1997, respectively. The determination of the
reserve rests upon management's judgment about factors affecting loan quality
and assumptions about the economy. Management considers the March 31, 1998
allowance for loan losses adequate to cover potential losses in the loan
portfolio.
NONINTEREST INCOME
- ------------------
Noninterest income consists primarily of service charges on deposit accounts.
Service charges on deposit accounts amounted to $477,000 in first quarter 1998
as compared to $455,000 in first quarter 1997, or an increase of 4.84%. All
other noninterest income decreased by $69,000 to $170,000 for first quarter 1998
from $239,000 for first quarter, 1997. There were no significant variances in
other noninterest income for the two periods.
NONINTEREST EXPENSE
- -------------------
Noninterest expense increased by 1.08% to $2,443,000 in three months ended March
31, 1998 from $2,417,000 for the same period in 1997. Salaries and benefits were
flat as the three months ended March 31, 1998 amounted to $1,262,00 compared to
$1,266,000 for the same period in 1997. Due to an additional facility and
furnishings, occupancy expenses increased by 18.69% to $400,000 for first
quarter 1998 compared to $337,000 for first quarter 1997. All other noninterest
expenses decreased by $33,000 to $781,000 for first quarter 1998 from $814,000
for first quarter 1997. There were no significant variances in other noninterest
expense for the two periods.
INCOME TAX EXPENSE
- ------------------
Income before taxes increased by $77,000 to $1,716,000 in first quarter 1998
from $1,639,000 in first quarter 1997. The increase for the three months ended
March 31, 1998 is primarily attributable to the increased net interest income.
Income taxes as a percentage of income before taxes increased by 1.23% to 31.99%
in first quarter 1998 as compared to 31.60% in first quarter 1997 due to
increased net interest income. Income tax expense increased 5.98% to $549,000
for first quarter 1998 as compared to $518,000 in first quarter 1997.
FUTURE OUTLOOK
- --------------
Colony is an emerging company operating in an industry filled with non-regulated
competitors and a rapid pace of consolidation. 1998 brings with it new
opportunities for growth in our existing markets, as well as opportunities to
expand into new markets through bank acquisitions and branching. Colony has
targeted new branches in three growth markets in South Georgia for 1998. These
new branches will be located in Douglas, Tifton and Leesburg.
18
<PAGE>
Colony Management Services, Inc. has invested over $1,000,000 in computer up-
grades and software enhancements in a major cost containment initiative. Not
only will this reduce overhead through back-office consolidation, but it also
will allow us to better serve our customers through improved customer data
resources and state-of-the art technological services.
YEAR 2000 COMPLIANCE
- --------------------
The Company has developed preliminary plans to address the possible exposure
related to the impact on its financial, informational and operational systems of
the Year 2000. The Company recently underwent a major computer conversion, which
has been tested and assured to be Year 2000 compliant. Other equipment has been
identified and vendors are being contracted. The Company's subsidiary, Colony
Management Services, Inc., is responsible for coordinating efforts of all bank
subsidiaries in any follow up procedures necessary. While there may be some
expenses incurred during the next two years, it is not expected to have a
material effect on the Company's consolidated financial statements.
LIQUIDITY
- ---------
The Company's goals with respect to liquidity are to ensure that sufficient
funds are available to meet current operating requirements, to provide reserves
against unforeseen liquidity requirements. Management continuously reviews the
Company's liquidity position, which is maintained on a basis consistent with
established internal guidelines and the tests and reviews of the various
regulatory authorities. The Company's primary liquidity sources at March 31,
1998 included cash, due from banks, federal funds and short-term investment
securities. The Company also has the ability, on a short-term basis, to borrow
funds from the Federal Reserve System and to invest in federal funds sold from
other financial institutions. The mix of asset maturities contributes to the
company's overall liquidity position.
CERTAIN TRANSACTIONS
- --------------------
In the normal course of business, officers and directors of the Banks, and
certain business organizations and individuals associated with them, maintain a
variety of banking relationships with the bank. Transactions with senior
officers and directors are made on terms comparable to those available to other
bank customers.
19
<PAGE>
BUSINESS
GENERAL
- -------
The Company was organized in 1983 as a bank holding company through the merger
of The Bank of Fitzgerald with a subsidiary of the Company. Since that time, The
Bank of Fitzgerald, which was formed by principals of Colony Bankcorp, Inc. in
1976, has operated as a wholly-owned subsidiary of the Company. In April 1984,
Colony Bankcorp, Inc. acquired Community Bank of Wilcox, and in November 1984,
Ashburn Bank became a wholly-owned subsidiary of Colony Bankcorp, Inc. Colony
Bankcorp, Inc. continued its growth with the acquisition of The Bank of Dodge
County in September 1985. In August 1991, Colony Bankcorp, Inc. acquired The
Bank of Worth. In November 1996, Colony Bankcorp, Inc. acquired Colony Bank
Southeast and in November, 1996 formed a non-bank subsidiary, Colony Management
Services, Inc.
Through its six subsidiary banks, Colony Bankcorp, Inc. operates a full-service
banking business and offers a broad range of retail and commercial banking
services including checking, savings, NOW accounts, money market and time
deposits of various types; loans for business, agriculture, real estate,
personal uses, home improvement and automobiles; credit card; letters of credit;
trust services investment, and discount brokerage services; IRA's, safe deposit
box rentals, bank money orders, and electronic funds transfer services,
including wire transfers and automated teller machines. Each of the Banks is a
state chartered institution whose customer deposits are insured up to applicable
limits by the Federal Deposit Insurance Corporation.
On April 2, 1998, the Company was listed on Nasdaq National Market. The
Company's common stock trades on the Nasdaq Stock Market under the symbol
"CBAN." The company presently has 930 shareholders of record as of March 31,
1998. "The Nasdaq Stock Market" or "Nasdaq" is a highly-regulated electronic
securities market comprised of competing Market Makers whose trading is
supported by a communications network linking them to quotation dissemination,
trade reporting and order execution systems. This market also provides
specialized automation services for screen-based negotiations of transactions,
on-line comparison of transactions, and a range of informational services
tailored to the needs of the securities industry, investors and issuers. The
Nasdaq Stock Market is operated by The Nasdaq Stock Market, Inc., a wholly-owned
subsidiary of the National Association of Securities Dealers, Inc.
PART II - OTHER INFORMATION
ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K
- -----------------------------------------
A. Exhibits - None
B. There have been no reports filed on Form 8-K for the quarter ended March 31,
1998.
20
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
COLONY BANKCORP, INC.
May 8, 1998 /s/ James D. Minix
- ------------------- ---------------------------------------------
DATE James D. Minix, President and
Chief Executive Officer
/s/ Terry L. Hester
---------------------------------------------
Terry L. Hester, Executive Vice President and
Chief Financial Officer
21
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 9
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> MAR-31-1998
<CASH> 11,097
<INT-BEARING-DEPOSITS> 2,067
<FED-FUNDS-SOLD> 23,470
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 55,599
<INVESTMENTS-CARRYING> 3,059
<INVESTMENTS-MARKET> 3,043
<LOANS> 237,372
<ALLOWANCE> 4,743
<TOTAL-ASSETS> 344,788
<DEPOSITS> 300,463
<SHORT-TERM> 2,500
<LIABILITIES-OTHER> 2,877
<LONG-TERM> 8,215
0
0
<COMMON> 22,175
<OTHER-SE> 8,558
<TOTAL-LIABILITIES-AND-EQUITY> 344,788
<INTEREST-LOAN> 6,283
<INTEREST-INVEST> 856
<INTEREST-OTHER> 323
<INTEREST-TOTAL> 7,462
<INTEREST-DEPOSIT> 3,477
<INTEREST-EXPENSE> 3,671
<INTEREST-INCOME-NET> 3,791
<LOAN-LOSSES> 279
<SECURITIES-GAINS> 2
<EXPENSE-OTHER> 2,443
<INCOME-PRETAX> 1,716
<INCOME-PRE-EXTRAORDINARY> 1,716
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,167
<EPS-PRIMARY> 0.53
<EPS-DILUTED> 0.53
<YIELD-ACTUAL> 4.87
<LOANS-NON> 6,290
<LOANS-PAST> 1,108
<LOANS-TROUBLED> 48
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 4,575
<CHARGE-OFFS> 196
<RECOVERIES> 85
<ALLOWANCE-CLOSE> 4,743
<ALLOWANCE-DOMESTIC> 4,743
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
