Press Release


Capital City Bank Group, Inc. Reports Second Quarter 2017 Results

Company Release - 7/25/2017 7:00 AM ET

TALLAHASSEE, Fla., July 25, 2017 (GLOBE NEWSWIRE) -- Capital City Bank Group, Inc. (Nasdaq:CCBG) today reported net income of $3.6 million, or $0.21 per diluted share for the second quarter of 2017 compared to net income of $2.7 million, or $0.16 per diluted share for the first quarter of 2017, and $3.9 million, or $0.22 per diluted share, for the second quarter of 2016.  For the first six months of 2017, net income totaled $6.3 million, or $0.37 per diluted share, compared to net income of $5.6 million, or $0.32 per diluted share for the same period in 2016.       

HIGHLIGHTS

  • Earnings per share grew 31% sequentially and 16% over prior year
  • Net interest income grew 3.9% sequentially and 4.3% over prior year
  • Strong period-end loan growth of 2.3% sequentially and 6.3% over prior year
  • Continued progress in reducing noninterest expense, which declined 3.1% from prior year
  • NPAs down 10% sequentially and 17% from year-end 2016

“Our year-to-date performance reflects continued improvement in most all aspects of our business,” said William G. Smith, Jr., Chairman, President and CEO. “Rising interest rates coupled with our asset sensitive balance sheet and loan growth are having a positive impact on our margin.  Credit quality and expense management continued their favorable trends.  Our team is focused on creating a positive client experience and executing on those initiatives that add value to our shareowners.  I look forward to the opportunities and challenges that lie ahead.”

Compared to the first quarter of 2017, performance reflected higher net interest income of $0.8 million and a $0.4 million increase in noninterest income, partially offset by a $0.3 million increase in the loan loss provision.

Compared to the second quarter of 2016, the decrease in earnings reflected lower noninterest income of $2.0 million and a $0.7 million increase in the loan loss provision, partially offset by higher net interest income of $1.1 million, a $0.8 million reduction in noninterest expense, and lower incomes taxes of $0.5 million.

The increase in earnings for the first six months of 2017 versus the comparable period in 2016 was attributable to higher net interest income of $1.6 million and a $1.7 million reduction in noninterest expense, partially offset by a $0.5 million increase in the loan loss provision, lower noninterest income of $2.0 million, and a $0.1 million increase in income taxes.

Our return on average assets (“ROA”) was 0.51% and our return on average equity (“ROE”) was 5.07% for the second quarter of 2017.  These metrics were 0.39% and 4.00% for the first quarter of 2017, respectively, and 0.57% and 5.65% for the second quarter of 2016, respectively.  For the first six months of 2017, our ROA was 0.45% and our ROE was 4.54% compared to 0.41% and 4.03%, respectively, for the same period in 2016.

Discussion of Operating Results

Tax equivalent net interest income for the second quarter of 2017 was $20.8 million compared to $20.0 million for the first quarter of 2017 and $19.6 million for the second quarter of 2016.  The increase in tax equivalent net interest income compared to the first quarter of 2017 reflects a favorable shift in the earning asset mix, one additional calendar day, and higher short-term rates,  partially offset by higher rates paid on negotiated rate deposits. The increase in tax equivalent net interest income compared to the second quarter of 2016 reflects growth in the loan portfolio, and higher short-term rates, partially offset by a higher rate paid on negotiated rate deposits. For the first six months of 2017, tax equivalent net interest income totaled $40.8 million compared to $39.0 million for the comparable period in 2016.  The year over year increase was driven by growth in the loan and investment portfolios, coupled with higher short-term rates, partially offset by a higher rate paid on negotiated rate deposits and one less calendar day.

The overnight funds rate has increased four times since December 2015, from a range of 0.00%-0.25% to a range of 1.00% to 1.25%. These increases have positively affected our net interest income due to favorable repricing of our variable and adjustable rate earning assets. Although these rate increases have also resulted in higher rates paid on our negotiated rate products, we continue to monitor and manage our overall cost of funds, which was 15 basis points in the second quarter of 2017. Despite highly competitive loan pricing across most markets, the yield of the overall loan portfolio increased quarter-over-quarter.

Our net interest margin for the second quarter of 2017 was 3.33%, an increase of 12 basis points over the first quarter of 2017 and an increase of 11 basis points over the second quarter of 2016.  For the first six months of 2017, the net interest margin increased six basis points to 3.27% compared to the same period of 2016. The increase in the margin as compared to all respective periods reflects rising interest rates and a favorable shift in our earning asset mix, which has produced higher net interest income in each period. 

The provision for loan losses for the second quarter of 2017 was $0.6 million compared to $0.3 million for the first quarter of 2017 and negative $0.1 million for the second quarter of 2016.  For the first six months of 2017, the loan loss provision totaled $0.9 million compared to $0.4 million for the same period of 2016.  The increase in the loan loss provision compared to all prior periods was primarily attributable to growth in the loan portfolio.  At June 30, 2017, the allowance for loan losses was $13.2 million, or 0.81% of outstanding loans (net of overdrafts) and provided coverage of 166% of nonperforming loans compared to 0.84% and 161%, respectively, at March 31, 2017 and 0.86% and 157%, respectively, at December 31, 2016.

Noninterest income for the second quarter of 2017 totaled $13.1 million, an increase of $0.4 million, or 3.3%, over the first quarter of 2017 due to higher wealth management fees of $0.2 million and mortgage banking fees of $0.2 million.  Compared to the second quarter of 2016, noninterest income decreased $2.0 million, or 13.7%, due to a $2.5 million decrease in other income and lower deposit fees of $0.2 million, partially offset by higher wealth management fees of $0.4 million and mortgage banking fees of $0.3 million.  The reduction in other income was due to a $2.5 million gain from the partial retirement of our trust preferred securities (“TRUPs”) in the second quarter of 2016.  For the first six months of 2017, noninterest income totaled $25.9 million, a $2.0 million, or 7.3%, decrease from the same period of 2016, due to lower other income of $2.4 million related to the aforementioned TRUPs gain and to a lesser extent lower deposit fees of $0.6 million that were partially offset by higher wealth management fees of $0.4 million and mortgage banking fees of $0.6 million.  Strong home sales in our markets and a growing market share of residential loan production continues to enhance our mortgage banking fees and improved sales efforts have resulted in strong growth in wealth management fees during 2017.

Noninterest expense for the second quarter of 2017 totaled $27.9 million comparable to the first quarter of 2017 as lower compensation expense of $0.2 million and other real estate owned (“OREO”) expense of $0.3 million were offset by higher occupancy expense of $0.2 million and other expense of $0.3 million.  Compared to the second quarter of 2016, noninterest expense decreased $0.8 million, or 2.7%, primarily due to lower OREO expense.  For the first six months of 2017, noninterest expense totaled $55.8 million, a decrease of $1.8 million, or 3.1%, from the same period of 2016 primarily attributable to lower OREO expense of $1.6 million and other expense of $0.6 million that was partially offset by higher compensation expense of $0.5 million.  OREO expense continues to decline as we liquidate our remaining properties.  Further reduction in legal expense and FDIC insurance expense drove the reduction in other expense.  The increase in compensation expense was primarily due to higher stock compensation expense related to higher pay-out values reflective of improving financial performance.    

We realized income tax expense of $1.6 million (30% effective rate) for the second quarter of 2017 compared to $1.5 million (35% effective rate) for the first quarter of 2017 and $2.1 million (34% effective rate) for the second quarter of 2016.  The lower effective tax rate for the second quarter of 2017 reflects income tax benefits realized in connection with stock based compensation awards.  For the first six months of 2017, income tax expense totaled $3.0 million (33% effective rate) compared to $2.9 million (34% effective rate) for the comparable period of 2016.

Discussion of Financial Condition

Average earning assets were $2.502 billion for the second quarter of 2017, a decrease of $27.2 million, or 1.1%, from the first quarter of 2017, and an increase of $78.6 million, or 3.2%, over the fourth quarter of 2016.  The change in earning assets in each of the respective periods is attributable to increases/decreases in our short-term investments and growth in our loan portfolio. Changes in the level of our short-term investments (which consists primarily of overnight funds) are partially attributable to the seasonality of our public fund deposits.

We maintained an average net overnight funds (deposits with banks plus fed funds sold less fed funds purchased) sold position of $200.8 million during the second quarter of 2017 compared to an average net overnight funds sold position of $245.2 million in the first quarter of 2017 and $145.5 million in the fourth quarter of 2016. The decrease in net overnight funds compared to the first quarter of 2017 reflected growth in our loan portfolio and declines in public fund balances. The increase in net overnight funds compared to the fourth quarter of 2016 primarily reflected higher levels of all deposit products other than certificates of deposit, partially offset by growth in the loan portfolio.

Average loans increased $23.1 million, or 1.5% compared to the first quarter of 2017, and have grown $35.4 million, or 2.3% compared to the fourth quarter of 2016. The increase compared to the prior quarter reflected growth in all loans types except commercial loans and home equity loans. Growth over the fourth quarter of 2016 was experienced in all loan products except institutional loans and home equity loans.  Although having a minimal impact on this quarters’ average balance, a $16.4 million pool of fixed and adjustable rate commercial real estate loans was purchased in late June.

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 production.

Nonperforming assets (nonaccrual loans and OREO) totaled $15.9 million at the end of the second quarter of 2017, a decrease of $1.9 million, or 10%, from the first quarter of 2017 and $3.2 million, or 17%, from the fourth quarter of 2016.  Nonaccrual loans totaled $7.9 million at the end of the second quarter of 2017, a $0.3 million decrease from the first quarter of 2017 and a $0.6 million decrease from the fourth quarter of 2016.  The balance of OREO totaled $8.0 million at the end of the second quarter of 2017, a decrease of $1.6 million from the first quarter of 2017 and $2.7 million from the fourth quarter of 2016.  Nonperforming assets represented 0.57% of total assets as of June 30, 2017 compared to 0.61% at March 31, 2017 and 0.67% at December 31, 2016.

Average total deposits were $2.373 billion for the second quarter of 2017, a decrease of $33.9 million, or 1.4%, from the first quarter of 2017, and an increase of $66.5 million, or 2.9% over the fourth quarter of 2016. The decline in deposits compared to the first quarter of 2017 reflected lower public NOW account and certificates of deposit balances, partially offset by increases in all other deposit types. The increase in deposits when compared to the fourth quarter of 2016 reflected growth in all deposit products except certificates of deposit.  The seasonal inflows of public funds peaked in the first quarter of 2017 for this cycle, and are expected to decline into the fourth quarter of 2017.

Deposit levels remain strong, as the seasonal decline in public NOW accounts was partially offset by increases in all other nonmaturity deposits during the quarter.  Average core deposits continue to experience growth as rates have increased from historical lows. We continue to monitor our overall liquidity position and deposit rates as we believe that a prudent pricing discipline remains the key to managing our mix of deposits.

Compared to the first quarter of 2017, average borrowings decreased $2.3 million due to a decline in short-term borrowings, partially offset by an increase in average long-term borrowings. Compared to the fourth quarter of 2016, average borrowings decreased by $7.2 million due to a $1.1 million reduction in repurchase agreements, with the remaining $6.1 million decline resulting from FHLB pay-downs of matched funded advances. 

Shareowners’ equity was $281.5 million at June 30, 2017, compared to $278.1 million at March 31, 2017 and $275.2 million at December 31, 2016.  Our leverage ratio was 10.20%, 9.95%, and 10.23%, respectively, for these periods.  Further, at June 30, 2017, our risk-adjusted capital ratio was 16.32% compared to 16.44% and 16.28% at March 31, 2017 and December 31, 2016, respectively.  Our common equity tier 1 ratio was 12.72% at June 30, 2017, compared to 12.77% at March 31, 2017 and 12.61% at December 31, 2016.  All of our capital ratios exceeded 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 $2.8 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, and securities brokerage services.  Our bank subsidiary, Capital City Bank, was founded in 1895 and now has 60 banking offices and 74 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) Jun 30, 2017Mar 31, 2017Dec 31, 2016Sep 30, 2016Jun 30, 2016
Shareowners' Equity (GAAP) $281,513  $278,059  $275,168  $276,624  $274,824 
Less: Goodwill (GAAP)  84,811   84,811   84,811   84,811   84,811 
Tangible Shareowners' Equity (non-GAAP)A 196,702   193,248   190,357   191,813   190,013 
Total Assets (GAAP)  2,814,843   2,895,531   2,845,197   2,753,154   2,767,636 
Less: Goodwill (GAAP)  84,811   84,811   84,811   84,811   84,811 
Tangible Assets (non-GAAP)B$2,730,032  $2,810,720  $2,760,386  $2,668,343  $2,682,825 
Tangible Common Equity Ratio (non-GAAP)A/B 7.21%   6.88%   6.90%   7.19%   7.08% 
Actual Diluted Shares Outstanding (GAAP)C 17,025   16,979   16,949   16,874   16,855 
Tangible Book Value per Diluted Share (non-GAAP) A/C $11.55  $11.38  $11.23  $11.37  $11.27 


CAPITAL CITY BANK GROUP, INC.          
EARNINGS HIGHLIGHTS          
Unaudited          
           
  Three Months Ended Six Months Ended
(Dollars in thousands, except per share data) Jun 30, 2017 Mar 31, 2017 Jun 30, 2016 Jun 30, 2017 Jun 30, 2016
           
EARNINGS          
Net Income$3,561 $2,744 $3,930 $6,305 $5,577 
Net Income Per Common Share$0.21 $0.16 $0.22 $0.37 $0.32 
PERFORMANCE          
Return on Average Assets 0.51%  0.39%  0.57%  0.45%  0.41% 
Return on Average Equity 5.07%  4.00%  5.65%  4.54%  4.03% 
Net Interest Margin 3.33%  3.21%  3.22%  3.27%  3.21% 
Noninterest Income as % of Operating Revenue 39.05%  39.19%  43.99%  39.12%  41.96% 
Efficiency Ratio 82.28%  85.33%  82.40%  83.78%  86.11% 
CAPITAL ADEQUACY          
Tier 1 Capital Ratio 15.58%  15.68%  15.63%  15.58%  15.63% 
Total Capital Ratio 16.32%  16.44%  16.44%  16.32%  16.44% 
Tangible Common Equity Ratio 7.21%  6.88%  7.08%  7.21%  7.08% 
Leverage Ratio 10.20%  9.95%  9.88%  10.20%  9.88% 
Common Equity Tier 1 Ratio 12.72%  12.77%  12.65%  12.72%  12.65% 
Equity to Assets 10.00%  9.60%  9.93%  10.00%  9.93% 
ASSET QUALITY          
Allowance as % of Non-Performing Loans 166.23%  160.70%  166.50%  166.23%  166.50% 
Allowance as a % of Loans 0.81%  0.84%  0.89%  0.81%  0.89% 
Net Charge-Offs as % of Average Loans 0.17%  0.10%  (0.04)%  0.14%  0.08% 
Nonperforming Assets as % of Loans and ORE 0.97%  1.11%  1.48%  0.97%  1.48% 
Nonperforming Assets as % of Total Assets 0.57%  0.61%  0.83%  0.57%  0.83% 
STOCK PERFORMANCE          
High$22.39 $21.79 $15.96 $22.39 $15.96 
Low 17.68  19.22  13.16  17.68  12.83 
Close$20.42 $21.39 $13.92 $20.42 $13.92 
Average Daily Trading Volume 23,349  23,150  20,192  23,251  21,426 


CAPITAL CITY BANK GROUP, INC.          
CONSOLIDATED STATEMENT OF FINANCIAL CONDITION      
Unaudited          
           
  2017  2016 
(Dollars in thousands) Second Quarter First Quarter Fourth Quarter Third Quarter Second Quarter
ASSETS          
Cash and Due From Banks$72,801 $47,650 $48,268 $79,608 $51,766 
Funds Sold and Interest Bearing Deposits 162,377  290,897  247,779  144,576  220,719 
Total Cash and Cash Equivalents 235,178  338,547  296,047  224,184  272,485 
           
Investment Securities Available for Sale 529,686  541,102  522,734  500,139  485,848 
Investment Securities Held to Maturity 157,074  158,515  177,365  189,928  204,474 
Total Investment Securities 686,760  699,617  700,099  690,067  690,322 
           
Loans Held for Sale 8,213  7,498  10,886  10,510  12,046 
           
Loans, Net of Unearned Interest          
Commercial, Financial, & Agricultural 213,544  214,595  216,404  223,278  207,105 
Real Estate - Construction 67,331  59,938  58,443  54,107  46,930 
Real Estate - Commercial 519,140  503,868  503,978  497,775  485,329 
Real Estate - Residential 302,072  295,406  272,895  276,193  280,015 
Real Estate - Home Equity 230,995  231,300  236,512  235,433  235,394 
Consumer 269,539  268,921  262,735  258,173  252,347 
Other Loans 17,057  9,586  8,614  10,875  11,177 
Overdrafts 1,518  1,345  1,708  1,678  2,177 
Total Loans, Net of Unearned Interest 1,621,196  1,584,959  1,561,289  1,557,512  1,520,474 
Allowance for Loan Losses (13,242) (13,335) (13,431) (13,744) (13,677)
Loans, Net 1,607,954  1,571,624  1,547,858  1,543,768  1,506,797 
           
Premises and Equipment, Net 92,495  93,755  95,476  96,499  97,313 
Goodwill 84,811  84,811  84,811  84,811  84,811 
Other Real Estate Owned 7,968  9,501  10,638  12,738  14,622 
Other Assets 91,464  90,178  99,382  90,577  89,240 
Total Other Assets 276,738  278,245  290,307  284,625  285,986 
           
Total Assets$2,814,843 $2,895,531 $2,845,197 $2,753,154 $2,767,636 
           
LIABILITIES          
Deposits:          
Noninterest Bearing Deposits$842,314 $836,011 $791,182 $801,671 $798,219 
NOW Accounts 787,090  882,605  904,014  793,363  804,263 
Money Market Accounts 265,032  263,080  252,800  257,004  259,813 
Regular Savings Accounts 327,560  321,160  304,680  298,682  294,432 
Certificates of Deposit 149,937  156,449  159,610  164,387  168,079 
Total Deposits 2,371,933  2,459,305  2,412,286  2,315,107  2,324,806 
           
Short-Term Borrowings 6,105  7,603  12,749  12,113  9,609 
Subordinated Notes Payable 52,887  52,887  52,887  52,887  52,887 
Other Long-Term Borrowings 15,631  16,460  14,881  21,368  26,401 
Other Liabilities 86,774  81,217  77,226  75,055  79,109 
           
Total Liabilities 2,533,330  2,617,472  2,570,029  2,476,530  2,492,812 
           
SHAREOWNERS' EQUITY          
Common Stock 170  170  168  168  168 
Additional Paid-In Capital 35,522  34,859  34,188  33,152  32,855 
Retained Earnings 271,646  268,934  267,037  264,581  262,380 
Accumulated Other Comprehensive Loss, Net of Tax (25,825) (25,904) (26,225) (21,277) (20,579)
           
Total Shareowners' Equity 281,513  278,059  275,168  276,624  274,824 
           
Total Liabilities and Shareowners' Equity$2,814,843 $2,895,531 $2,845,197 $2,753,154 $2,767,636 
           
OTHER BALANCE SHEET DATA          
Earning Assets$2,478,546 $2,582,971 $2,520,053 $2,402,664 $2,443,561 
Interest Bearing Liabilities 1,604,242  1,700,244  1,701,621  1,599,804  1,615,484 
           
Book Value Per Diluted Share$16.54 $16.38 $16.23 $16.39 $16.31 
Tangible Book Value Per Diluted Share 11.55  11.38  11.23  11.37  11.27 
           
Actual Basic Shares Outstanding 16,964  16,954  16,845  16,807  16,804 
Actual Diluted Shares Outstanding 17,025  16,979  16,949  16,874  16,855 


CAPITAL CITY BANK GROUP, INC.                    
CONSOLIDATED STATEMENT OF OPERATIONS                
Unaudited                    
                     
                 Six Months Ended
  2017  2016   June 30,
(Dollars in thousands, except per share data) Second
Quarter
  First
Quarter
  Fourth
Quarter
  Third
Quarter
  Second
Quarter
  2017  2016
                     
INTEREST INCOME                    
Interest and Fees on Loans$18,720 $18,005 $18,671 $18,046 $18,105  $36,725 $36,150
Investment Securities 2,169  2,042  1,949  1,846  1,751   4,211  3,388
Funds Sold 533  493  212  212  318   1,026  680
Total Interest Income 21,422  20,540  20,832  20,104  20,174   41,962  40,218
                     
INTEREST EXPENSE                    
Deposits 388  281  224  223  211   669  432
Short-Term Borrowings 17  45  57  43  38   62  48
Subordinated Notes Payable 404  379  363  341  343   783  730
Other Long-Term Borrowings 117  99  129  177  206   216  422
Total Interest Expense 926  804  773  784  798   1,730  1,632
Net Interest Income 20,496  19,736  20,059  19,320  19,376   40,232  38,586
Provision for Loan Losses 589  310  464  -  (97)  899  355
Net Interest Income after Provision for
  Loan Losses
 19,907  19,426  19,595  19,320  19,473   39,333  38,231
                     
NONINTEREST INCOME                    
Deposit Fees 5,052  5,090  5,238  5,373  5,321   10,142  10,721
Bank Card Fees 2,870  2,803  2,754  2,759  2,855   5,673  5,708
Wealth Management Fees 2,073  1,842  1,773  1,774  1,690   3,915  3,482
Mortgage Banking Fees 1,556  1,308  1,392  1,503  1,267   2,864  2,297
Other 1,584  1,675  1,621  1,602  4,082   3,259  5,684
Total Noninterest Income 13,135  12,718  12,778  13,011  15,215   25,853  27,892
                     
NONINTEREST EXPENSE                    
Compensation 16,292  16,496  16,699  15,993  16,051   32,788  32,292
Occupancy, Net 4,555  4,381  4,519  4,734  4,584   8,936  9,043
Other Real Estate, Net 315  583  343  821  1,060   898  2,485
Other 6,759  6,462  5,999  6,474  7,007   13,221  13,812
Total Noninterest Expense 27,921  27,922  27,560  28,022  28,702   55,843  57,632
                     
OPERATING PROFIT 5,121  4,222  4,813  4,309  5,986   9,343  8,491
Income Tax Expense 1,560  1,478  1,517  1,436  2,056   3,038  2,914
NET INCOME$3,561 $2,744 $3,296 $2,873 $3,930  $6,305 $5,577
                     
PER SHARE DATA                    
Basic Net Income$0.21 $0.16 $0.20 $0.18 $0.22  $0.37 $0.32
Diluted Net Income 0.21  0.16  0.20  0.17  0.22   0.37  0.32
Cash Dividend$0.05 $0.05 $0.05 $0.04 $0.04  $0.10 $0.08
AVERAGE SHARES                    
Basic 16,955  16,919  16,809  16,804  17,144   16,937  17,173
Diluted 17,016  16,944  16,913  16,871  17,196   16,993  17,215


CAPITAL CITY BANK GROUP, INC.              
ALLOWANCE FOR LOAN LOSSES               
AND RISK ELEMENT ASSETS              
Unaudited              
               
            Six Months Ended
  2017
 2016
 June 30,
(Dollars in thousands, except per share data) Second Quarter First Quarter Fourth Quarter Third Quarter Second Quarter 2017 
 2016
               
ALLOWANCE FOR LOAN LOSSES              
Balance at Beginning of Period$13,335 $13,431 $13,744 $13,677 $13,613 $13,431 $13,953 
Provision for Loan Losses 589  310  464  -  (97) 899  355 
Net Charge-Offs 682  406  777  (67) (161) 1,088  631 
Balance at End of Period$13,242 $13,335 $13,431 $13,744 $13,677 $13,242 $13,677 
As a % of Loans 0.81%  0.84%  0.86%  0.88%  0.89%  0.81%  0.89% 
As a % of Nonperforming Loans 166.23%  160.70%  157.40%  159.56%  166.50%  166.23%  166.50% 
               
CHARGE-OFFS              
Commercial, Financial and Agricultural$324 $93 $377 $143 $304 $417 $341 
Real Estate - Construction -  -  -  -  -  -  - 
Real Estate - Commercial 478  71  70  5  -  549  274 
Real Estate - Residential 44  116  120  96  205  160  683 
Real Estate - Home Equity -  92  38  51  146  92  361 
Consumer 537  624  771  479  438  1,161  877 
Total Charge-Offs$1,383 $996 $1,376 $774 $1,093 $2,379 $2,536 
               
RECOVERIES              
Commercial, Financial and Agricultural$40 $81 $50 $199 $49 $121 $88 
Real Estate - Construction -  -  -  -  -  -  - 
Real Estate - Commercial 58  23  45  45  237  81  318 
Real Estate - Residential 202  213  277  139  579  415  815 
Real Estate - Home Equity 39  29  32  237  81  68  140 
Consumer 362  244  195  221  308  606  544 
Total Recoveries$701 $590 $599 $841 $1,254 $1,291 $1,905 
               
NET CHARGE-OFFS$682 $406 $777 $(67)$(161)$1,088 $631 
               
Net Charge-Offs as a % of Average Loans (1) 0.17%  0.10%  0.20%  (0.02)%  (0.04)%  0.14%  0.08% 
               
RISK ELEMENT ASSETS              
Nonaccruing Loans$7,966 $8,298 $8,533 $8,614 $8,214     
Other Real Estate Owned 7,968  9,501  10,638  12,738  14,622     
Total Nonperforming Assets$15,934 $17,799 $19,171 $21,352 $22,836     
               
Past Due Loans 30-89 Days$3,789 $3,263 $6,438 $5,667 $3,872     
Past Due Loans 90 Days or More -  -  -  -  -     
Classified Loans 41,322  40,978  41,507  43,228  45,058     
Performing Troubled Debt Restructuring's$35,436 $36,555 $38,233 $35,046 $35,526     
               
Nonperforming Loans as a % of Loans 0.49%  0.52%  0.54%  0.55%  0.54%     
Nonperforming Assets as a % of Loans and              
Other Real Estate 0.97%  1.11%  1.21%  1.35%  1.48%     
Nonperforming Assets as a % of Total Assets 0.57%  0.61%  0.67%  0.78%  0.83%     
               
(1) Annualized              


CAPITAL CITY BANK GROUP, INC.                                           
AVERAGE BALANCE AND INTEREST RATES(1)                                           
Unaudited                                                 
                                                  
  Second Quarter 2017  First Quarter 2017  Fourth Quarter 2016  Third Quarter 2016  Second Quarter 2016  Jun 2017 YTD  Jun 2016 YTD 
(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
  Average
Balance
 Interest Average
Rate
  Average
Balance
 Interest Average
Rate
 
ASSETS:                                                 
Loans, Net of Unearned Interest$1,608,629  18,880 4.71%$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%$1,597,159  37,017 4.67%$1,519,642  36,374 4.81%
                                                  
Investment Securities                                                 
Taxable Investment Securities 591,825  1,898 1.28  600,528  1,784 1.20  614,560  1,726 1.12  606,606  1,632 1.07  571,343  1,539 1.08  596,153  3,682 1.24  561,718  2,959 1.03 
Tax-Exempt Investment Securities 100,742  414 1.64  97,965  396 1.62  90,046  343 1.52  89,241  327 1.47  90,030  325 1.44  99,361  810 1.63  92,490  657 1.42 
                                                  
Total Investment Securities 692,567  2,312 1.34  698,493  2,180 1.26  704,606  2,069 1.17  695,847  1,959 1.12  661,373  1,864 1.13  695,514  4,492 1.30  654,208  3,616 1.11 
                                                  
Funds Sold 200,834  533 1.06  245,153  493 0.81  145,518  212 0.58  166,207  212 0.51  254,627  318 0.50  222,871  1,026 0.93  270,397  680 0.51 
                                                  
Total Earning Assets 2,502,030 $21,725 3.48% 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% 2,515,544 $42,535 3.41% 2,444,247 $40,670 3.35%
                                                  
Cash and Due From Banks 52,312       48,906       50,207       45,139       46,605       50,618       47,220      
Allowance for Loan Losses (13,662)      (13,436)      (14,017)      (14,052)      (14,254)      (13,550)      (14,127)     
Other Assets 276,799       280,463       283,885       285,435       287,726       278,621       288,460      
                                                  
Total Assets$2,817,479      $2,845,140      $2,743,463      $2,734,465      $2,767,854      $2,831,233      $2,765,800      
                                                  
LIABILITIES:                                                 
Interest Bearing Deposits                                                 
NOW Accounts$806,621 $222 0.11%$880,707 $134 0.06%$782,518 $78 0.04%$774,899 $78 0.04%$762,667 $67 0.04%$843,459 $356 0.09%$780,832 $136 0.03%
Money Market Accounts 261,726  57 0.09  259,106  35 0.06  257,398  31 0.05  258,183  30 0.05  257,000  30 0.05  260,423  92 0.07  254,723  59 0.05 
Savings Accounts 322,833  39 0.05  311,212  38 0.05  303,006  37 0.05  297,172  37 0.05  291,210  36 0.05  317,055  77 0.05  284,477  70 0.05 
Time Deposits 152,811  70 0.18  158,289  74 0.19  161,859  78 0.19  165,324  78 0.19  170,837  78 0.19  155,535  144 0.19  173,947  167 0.19 
Total Interest Bearing Deposits 1,543,991  388 0.10% 1,609,314  281 0.07% 1,504,781  224 0.06% 1,495,578  223 0.06% 1,481,714  211 0.06% 1,576,472  669 0.09% 1,493,979  432 0.06%
                                                  
Short-Term Borrowings 8,957  17 0.75% 12,810  45 1.43% 14,768  57 1.54% 12,162  43 1.39% 53,691  38 0.28% 10,873  62 1.15% 60,315  48 0.16%
Subordinated Notes Payable 52,887  404 3.02  52,887  379 2.86  52,887  363 2.68  52,887  341 2.52  54,316  343 2.50  52,887  783 2.94  58,601  730 2.47 
Other Long-Term Borrowings 16,065  117 2.93  14,468  99 2.77  17,473  129 2.93  23,629  177 2.98  26,721  206 3.11  15,271  216 2.85  27,245  422 3.11 
                                                  
Total Interest Bearing Liabilities 1,621,900 $926 0.23% 1,689,479 $804 0.20% 1,589,909 $773 0.20% 1,584,256 $784 0.20% 1,616,442 $798 0.20% 1,655,503 $1,730 0.22% 1,640,140