Capital City Bank Group, Inc. Reports Fourth Quarter and Full Year 2007 Results
TALLAHASSEE, Fla., Jan. 22, 2008 (PRIME NEWSWIRE) -- Capital City Bank Group, Inc. (Nasdaq:CCBG) today reported net income for the fourth quarter of 2007 totaling $7.7 million ($0.44 per diluted share) compared to $8.9 million ($0.48 per diluted share) in the fourth quarter of 2006 and $7.2 million ($0.41 per diluted share) for the third quarter of 2007. Net income for the year ended 2007 totaled $29.7 million ($1.66 per diluted share) compared to $33.3 million ($1.79 per diluted share) for 2006. Earnings per share reflect the company's repurchase of 447,823 common shares during the fourth quarter and a total of 1,404,364 common shares for the full-year 2007.
"Net income for the final quarter and the full year were lower in 2007 than for the comparable periods of 2006 as a result of margin compression and a higher loan loss provision," said William G. Smith, Jr., Chairman, President, and CEO of Capital City Bank Group, Inc. "Consistent with the trends throughout the banking industry, our funding costs increased over the course of the year, but began to decline as the Fed lowered rates during the fourth quarter."
"Credit quality and risk assessment are clearly the most important issues we are focused upon as we move into 2008. Accordingly, during the fourth quarter we recognized a higher provision for loan losses putting coverage at .95% of total loans, or 72% of nonperforming loans. We remain confident that the overall credit quality throughout our loan portfolio is sound and there are no significant concentrations in any particular borrower segment."
"Noninterest income growth was favorable throughout the year and we were successful in reducing our total expenses year over year. Due to our strong capital position and the current economic environment we had opportunities to repurchase a significant amount of our common stock. We expect these factors to continue to benefit the company during 2008," said Smith.
The Return on Average Assets was 1.18% and the Return on Average Equity was 9.68% for 2007 compared to 1.29% and 10.48%, respectively, for 2006. For the fourth quarter of 2007, the aforementioned metrics were 1.21% and 10.16% compared to 1.37% and 10.84% for the comparable quarter in 2006 and 1.15% and 9.44% for the third quarter of 2007.
Discussion of Financial Condition
Average earning assets were $2.191 billion for the fourth quarter, a decrease of $46.8 million, or 2.1%, from the fourth quarter of 2006 due to share repurchase activity, which approximated $43.2 million for 2007, and investment in office expansion. Average loans decreased $95.7 million, or 4.8% during the same period reflecting of a high level of principal pay-downs and loan pay-offs, including the pay-off of several larger commercial loans, and a slowing of lending activity. On a linked quarter basis, however, average loans were up slightly. Compared to the third quarter of 2007, average earning assets increased $46.5 million, or 2.2%, due to an increase in deposits, which is discussed in more detail below.
Nonperforming assets of $28.2 million increased from the prior year-end by $19.4 million and from the linked third quarter by $14.1 million. Nonaccrual loans increased $17.1 million and $12.7 million, respectively, from the same prior-year periods. The increase in nonaccrual loans in the fourth quarter primarily reflects the addition of three large loan relationships totaling $10.7 million, which had been internally identified as problem loans as of the end of the third quarter. Two of the aforementioned loans totaling $4.8 million are to borrowers employed in the real estate market and the other loan relationship totaling $5.9 million consists of loans to a commercial business. Other real estate owned totaled $3.0 million at year-end compared to $1.7 million at the end of the prior quarter and $0.7 million at year-end 2006. Nonperforming assets represented 1.47% of loans and other real estate at the end of the fourth quarter compared to .74% at the end of the third quarter and .44% at year-end 2006.
Average total deposits were $2.017 billion for the fourth quarter, a decrease of $11.7 million, or .58% from the fourth quarter of 2006 due primarily to a decline in savings ($14.5 million) and certificates of deposit ($13.4 million) balances. NOW and money market deposits, combined, experienced a net increase of $78.6 million for the same period driven by strong growth in public funds deposits during the fourth quarter of 2007, most of which are negotiated NOW accounts, while noninterest bearing deposits declined $62.5 million. Compared to the linked third quarter of 2007, average deposits increased $62.6 million, or 3.2% due to a significant increase in the level of public funds, a portion of which is attributable to normal seasonal activity, while the balance is due to changing market conditions. During the fourth quarter several local government entities, which are clients, transferred significant balances from the State Board of Administration's Local Government Investment Pool to Capital City Bank. These balances are reflected in our NOW account deposits, which increased, based on monthly averages, from $521 million in September to $719 million in December. While this growth added to our net interest income, public funds are generally higher cost deposits, which drove our average cost of funds up and thereby lowered our net interest margin percentage for the quarter. This is addressed in greater detail under "Discussion of Operating Results" below. As is normal with seasonal deposits, management expects deposit levels to decline during the first quarter of 2008.
The Company had approximately $84.0 million in average net overnight funds sold for the fourth quarter of 2007 as compared to $31.9 million in average net overnight funds sold in the third quarter of 2007 and $26.1 million in the fourth quarter of 2006. Loan balances, which declined through the first nine months of 2007, and the recent influx of public deposits contributed to the growth in overnight funds, which was partially offset by the repurchase of $43 million in CCBG common stock during 2007.
Discussion of Operating Results
Tax equivalent net interest income for the three and twelve months ended December 31, 2007, was $28.2 million and $114.7 million, respectively, compared to $30.2 million and $120.9 million for the comparable periods in 2006. Year-over-year, the decline in net interest income was due to an increase in interest expense driven by higher average rates, an unfavorable shift in our deposit mix as clients sought higher yielding deposit products, and a $75 million reduction in the level of average earning assets. The full year net interest margin of 5.25% decreased 10 basis points from 2006 attributable to a 36 basis point increase in our cost of funds, partially offset by a 26 basis point increase in the earning asset yield. The net interest margin declined 25 basis points between the fourth quarters of 2007 and 2006, reflecting a 15 basis point reduction in the yield on earning assets and a 10 basis point increase in the cost of funds. While management believes it has been successful in neutralizing the impact of the Fed rate reductions during the fourth quarter of 2007, the influx of higher cost public funds (primarily negotiated NOW accounts - See "Discussion of Financial Condition" for additional information) and a higher average rate on certificates of deposit drove cost of funds up relative to the fourth quarter of 2006. On a linked quarter basis, fourth quarter tax equivalent net interest income decreased $321,000, or 1.1%, and the net interest margin declined 17 basis points. The yield on earning assets declined 25 basis points attributable to a 100 basis point reduction in the Fed's target rate, a $14.1 million increase in nonperforming assets and a slightly unfavorable shift in asset mix. The average cost of funds declined eight basis points reflecting a reduction of average rates paid in response to the Fed's rate cuts; however, a significant portion of this benefit was offset by the influx of higher costs public funds as noted above. Further, it should be noted that net interest income in all comparative periods has been impacted by the rising level of nonperforming assets, which has increased from $8.7 million at December 31, 2006 to $28.2 million at December 31. 2007; and the lower level of noninterest bearing deposits, which have declined throughout 2006 and 2007 reflecting the disintermediation of noninterest bearing funds in a higher interest rate environment.
The provision for loan losses for the current quarter and full year was $1.7 million and $6.2 million, respectively, compared to $0.5 million and $2.0 million for the same periods in 2006. The increase in both periods is attributable an increase in charge-offs and a higher level of required reserves reflective of the current credit environment that has been impacted by a slowdown in housing and real estate markets. For the full year, net charge-offs totaled $5.3 million, or .27%, of average loans compared to $2.2 million, or .11% in 2006. For the fourth quarter, net charge-offs totaled $1.6 million, or .34% of average loans compared to $1.0 million, or .21% in the linked third quarter and $0.6 million, or .11% for the fourth quarter of 2006. At quarter-end, the allowance for loan losses was .95% of outstanding loans (net of overdrafts) and provided coverage of 72% of nonperforming loans.
Noninterest income for the three and twelve months ended December 31, 2007, was $15.8 million and $59.3 million, respectively, compared to $14.4 million and $55.6 million for the comparable periods in 2006. Higher deposit fees ($862,000), data processing fees ($144,000), card processing fees ($166,000), and other income ($621,000) drove the improvement for the three month period. Increases in deposit fees ($1.5 million), retail brokerage fees ($419,000), card processing fees ($931,000), and other income ($801,000) were the primary reasons for the improvement for the twelve month period. Compared to the linked third quarter, noninterest income rose $1.4 million or 9.6% due to higher deposit fees and other income, which included a one-time gain ($540,000 before-tax) on the sale of a banking office. The increase in deposit fees across all periods reflects higher activity levels and improved collection.
Noninterest expense continues to be very well controlled as evidenced by a nominal increase of $1.6 million, or 5.4% for the three month period and $424,000, or .35% for the twelve month period, as compared to the same periods in 2006. The increase in each period is attributable to a one-time, pre-tax charge of $1.9 million, which was recorded in the fourth quarter of 2007 to establish a litigation reserve(a). Capital City Bank is a member of Visa, U.S.A. and this reserve was established in connection with lawsuits filed against Visa, U.S.A., i.e. the "Covered" litigation. CCBG currently anticipates that its proportional share of the proceeds of Visa's planned initial public offering will more than offset any liabilities related to its pro-rata share of the "Covered" litigation. Compensation expense for both periods reflects reduced expense levels for performance based incentive plans and lower pension expense. Lower expense for courier services also contributed positively to both periods reflective of management's implementation during the first half of 2007 of a new process whereby the daily work from the offices is transmitted electronically rather than by courier.
Income tax expense for the three and twelve months was $2.4 million and $13.7 million, respectively, compared to $4.7 million and $17.9 million for the same periods in 2006. During the fourth quarter of 2007, the company trued-up its deferred tax liabilities. As a result, income tax expense was reduced by $937,000 in the current quarter.
About Capital City Bank Group, Inc.
Capital City Bank Group, Inc. (Nasdaq:CCBG) is one of the largest publicly traded financial services companies headquartered in Florida and has approximately $2.6 billion in assets. The Company provides a full range of banking services, including traditional deposit and credit services, asset management, trust, mortgage banking, merchant services, bankcards, data processing and securities brokerage services. The Company's bank subsidiary, Capital City Bank, was founded in 1895 and now has 69 banking offices, two mortgage lending offices, and 79 ATMs in Florida, Georgia and Alabama. In 2006, Mergent, Inc., a leading provider of information on publicly traded companies, named the Company as a Dividend Achiever. To be named a Dividend Achiever, a public company must have increased its regular cash dividends for at least 10 consecutive years. Of all publicly traded U.S. companies that pay dividends, less than three percent made this list. Capital City Bank Group, Inc. was also named to this list in 2005. 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 our future results to differ materially. The following factors, among others, could cause our actual results to differ: our ability to integrate acquisitions; the strength of the U.S. economy and the local economies where we conduct operations; harsh weather conditions; fluctuations in inflation, interest rates, or monetary policies; changes in the stock market and other capital and real estate markets; legislative or regulatory changes; customer acceptance of third-party products and services; increased competition and its effect on pricing; technological changes; changes in consumer spending and savings habits; our growth and profitability; changes in accounting; and our ability to manage the risks involved in the foregoing. Additional factors can be found in our Annual Report on Form 10-K for the fiscal year ended December 31, 2006, and our 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 we assume no obligation to update forward-looking statements or the reasons why actual results could differ.
(a) The nature and circumstances surrounding this one-time charge, which is expected to be reversed upon consummation of Visa, Inc.'s planned initial public offering, is fully explained in Form 8-Ks filed with the SEC by the Company on 1/10/08 and 1/22/08.
EARNINGS HIGHLIGHTS
---------------------------------------------------------------------
Twelve Months
Three Months Ended Ended
------------------------- ----------------
(Dollars in
thousands, except Dec 31, Sept 30, Dec 31, Dec 31, Dec 31,
per share data) 2007 2007 2006 2007 2006
---------------------------------------------------------------------
EARNINGS
Net Income $ 7,664 7,171 8,850 29,683 33,265
Diluted Earnings Per
Common Share 0.44 0.41 0.48 1.66 1.79
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PERFORMANCE
Return on Average Equity 10.16% 9.44 10.84 9.68 10.48
Return on Average Assets 1.21 1.15 1.37 1.18 1.29
Net Interest Margin 5.10 5.27 5.35 5.25 5.35
Noninterest Income as %
of Operating Revenue 36.49 34.08 32.71 34.57 31.81
Efficiency Ratio 68.51 66.27 63.99 66.77 65.42
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CAPITAL ADEQUACY
Tier 1 Capital Ratio 13.05% 13.74 14.00 13.05 14.00
Total Capital Ratio 14.05 14.76 14.95 14.05 14.95
Leverage Ratio 10.41 11.49 11.30 10.41 11.30
Equity to Assets 11.19 12.26 12.15 11.19 12.15
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ASSET QUALITY
Allowance as % of Non-
Performing Loans 71.92% 145.49 214.09 71.92 214.09
Allowance as a % of
Loans 0.95 0.95 0.86 0.95 0.86
Net Charge-Offs as % of
Average Loans 0.34 0.21 0.11 0.27 0.11
Nonperforming Assets as
% of Loans and ORE 1.47 0.74 0.44 1.47 0.44
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STOCK PERFORMANCE
High $ 34.00 36.40 35.98 36.40 37.97
Low 24.60 27.69 30.14 24.60 29.51
Close 28.22 31.20 35.30 28.22 35.30
Average Daily Trading
Volume 52,489 40,247 19,826 39,385 20,449
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CAPITAL CITY BANK GROUP, INC.
CONSOLIDATED STATEMENT OF INCOME
Unaudited
--------------------------------------------------------------------
2007 2006
-------------------------------------- ---------
(Dollars in
thousands, except Fourth Third Second First Fourth
per share data Quarter Quarter Quarter Quarter Quarter
--------------------------------------------------------------------
INTEREST INCOME
Interest and Fees
on Loans $ 37,730 38,692 39,092 39,053 40,096
Investment
Securities 1,992 1,968 1,943 1,940 1,928
Funds Sold 1,064 639 689 521 576
--------------------------------------------------------------------
Total Interest
Income 40,786 41,299 41,724 41,514 42,600
--------------------------------------------------------------------
INTEREST EXPENSE
Deposits 11,323 11,266 11,098 11,000 10,830
Short-Term
Borrowings 639 734 737 761 722
Subordinated Notes
Payable 936 936 932 926 936
Other Long-Term
Borrowings 343 453 496 502 515
--------------------------------------------------------------------
Total Interest
Expense 13,241 13,389 13,263 13,189 13,003
--------------------------------------------------------------------
Net Interest Income 27,545 27,910 28,461 28,325 29,597
Provision for Loan
Losses 1,699 1,552 1,675 1,237 460
--------------------------------------------------------------------
Net Interest Income
after Provision
for Loan Losses 25,846 26,358 26,786 27,088 29,137
--------------------------------------------------------------------
NONINTEREST INCOME
Service Charges on
Deposit Accounts 7,256 6,387 6,442 6,045 6,394
Data Processing 853 775 790 715 709
Asset Management
Fees 1,100 1,200 1,175 1,225 1,180
Retail Brokerage
Fees 619 625 804 462 586
Gain on Sale of
Investment
Securities 7 -- -- 7 --
Mortgage Banking
Revenues 425 642 850 679 787
Merchant Fees 1,743 1,686 1,892 1,936 1,694
Interchange Fees 962 934 951 910 845
ATM/Debit Card Fees 705 685 661 641 658
Other 2,153 1,497 1,519 1,342 1,532
--------------------------------------------------------------------
Total Noninterest
Income 15,823 14,431 15,084 13,962 14,385
--------------------------------------------------------------------
NONINTEREST EXPENSE
Salaries and
Associate Benefits 14,472 15,096 14,992 15,719 14,943
Occupancy, Net 2,378 2,409 2,324 2,236 2,460
Furniture and
Equipment 2,534 2,513 2,494 2,349 2,259
Intangible
Amortization 1,458 1,459 1,458 1,459 1,484
Other 10,772 8,442 8,629 8,799 8,838
--------------------------------------------------------------------
Total Noninterest
Expense 31,614 29,919 29,897 30,562 29,984
--------------------------------------------------------------------
OPERATING PROFIT 10,055 10,870 11,973 10,488 13,538
Provision for
Income Taxes 2,391 3,699 4,082 3,531 4,688
--------------------------------------------------------------------
NET INCOME $ 7,664 7,171 7,891 6,957 8,850
--------------------------------------------------------------------
PER SHARE DATA
Basic Earnings $ 0.44 0.41 0.43 0.38 0.48
Diluted Earnings 0.44 0.41 0.43 0.38 0.48
Cash Dividends 0.185 0.175 0.175 0.175 0.175
AVERAGE SHARES
Basic 17,444 17,709 18,089 18,409 18,525
Diluted 17,445 17,719 18,089 18,420 18,569
--------------------------------------------------------------------
------------------------------------------- --------------------
Twelve Months Ended
December 31
--------------------
(Dollars in thousands, except per share data 2007 2006
-------------------------------------------- --------------------
INTEREST INCOME
Interest and Fees on Loans $ 154,567 156,666
Investment Securities 7,843 7,188
Funds Sold 2,913 2,039
-----------------------------------------------------------------
Total Interest Income 165,323 165,893
-----------------------------------------------------------------
INTEREST EXPENSE
Deposits 44,687 37,253
Short-Term Borrowings 2,871 3,075
Subordinated Notes Payable 3,730 3,725
Other Long-Term Borrowings 1,794 2,704
-----------------------------------------------------------------
Total Interest Expense 53,082 46,757
-----------------------------------------------------------------
Net Interest Income 112,241 119,136
Provision for Loan Losses 6,163 1,959
-----------------------------------------------------------------
Net Interest Income after Provision for
Loan Losses 106,078 117,177
-----------------------------------------------------------------
NONINTEREST INCOME
Service Charges on Deposit Accounts 26,130 24,620
Data Processing 3,133 2,723
Asset Management Fees 4,700 4,600
Retail Brokerage Fees 2,510 2,091
Gain on Sale of Investment Securities 14 (4)
Mortgage Banking Revenues 2,596 3,235
Merchant Fees 7,257 6,978
Interchange Fees 3,757 3,105
ATM/Debit Card Fees 2,692 2,519
Other 6,511 5,710
-----------------------------------------------------------------
Total Noninterest Income 59,300 55,577
-----------------------------------------------------------------
NONINTEREST EXPENSE
Salaries and Associate Benefits 60,279 60,855
Occupancy, Net 9,347 9,395
Furniture and Equipment 9,890 9,911
Intangible Amortization 5,834 6,085
Other 36,642 35,322
-----------------------------------------------------------------
Total Noninterest Expense 121,992 121,568
-----------------------------------------------------------------
OPERATING PROFIT 43,386 51,186
Provision for Income Taxes 13,703 17,921
-----------------------------------------------------------------
NET INCOME $ 29,683 33,265
-----------------------------------------------------------------
PER SHARE DATA
Basic Earnings $ 1.66 1.79
Diluted Earnings 1.66 1.79
Cash Dividends 0.710 0.663
AVERAGE SHARES
Basic 17,909 18,585
Diluted 17,912 18,610
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CAPITAL CITY BANK GROUP, INC.
CONSOLIDATED STATEMENT OF FINANCIAL CONDITION
Unaudited
---------------------------------------------------------------------
2007 2006
----------------------------------------- --------
(Dollars in
thousands,
except per share Fourth Third Second First Fourth
data) Quarter Quarter Quarter Quarter Quarter
---------------------------------------------------------------------
ASSETS
Cash and Due From
Banks $ 93,437 91,378 95,573 92,233 98,769
Funds Sold and
Interest Bearing
Deposits 166,260 19,599 77,297 93,832 78,795
---------------------------------------------------------------------
Total Cash and
Cash Equivalents 259,697 110,977 172,870 186,065 177,564
Investment
Securities,
Available-for-
Sale 190,719 184,609 189,680 191,446 191,894
Loans, Net of
Unearned Interest
Commercial,
Financial, &
Agricultural 208,864 205,628 203,555 205,048 229,327
Real Estate -
Construction 142,248 145,343 159,751 180,549 179,072
Real Estate -
Commercial 634,920 631,418 640,172 643,272 643,885
Real Estate -
Residential 481,150 480,488 493,783 509,040 524,301
Real Estate -
Home Equity 192,428 183,620 175,781 172,283 173,597
Consumer 243,415 246,137 240,110 235,175 234,596
Credit Card -- -- -- -- --
Other Loans 7,222 8,739 14,715 14,899 11,837
Overdrafts 5,603 2,515 2,844 5,575 3,106
---------------------------------------------------------------------
Total Loans, Net
of Unearned
Interest 1,915,850 1,903,888 1,930,711 1,965,841 1,999,721
Allowance for
Loan Losses (18,066) (18,001) (17,469) (17,108) (17,217)
---------------------------------------------------------------------
Loans, Net 1,897,784 1,885,887 1,913,242 1,948,733 1,982,504
Premises and
Equipment, Net 98,612 95,816 92,656 88,812 86,538
Intangible Assets 98,568 100,026 101,485 102,944 104,402
Other Assets 70,947 62,611 60,815 60,117 55,008
---------------------------------------------------------------------
Total Other
Assets 268,127 258,453 254,956 251,873 245,948
---------------------------------------------------------------------
Total Assets $ 2,616,327 2,439,926 2,530,748 2,578,117 2,597,910
---------------------------------------------------------------------
LIABILITIES
Deposits:
Noninterest
Bearing
Deposits $ 432,659 419,242 456,986 467,875 490,014
NOW Accounts 744,093 530,619 559,050 575,740 599,433
Money Market
Accounts 386,619 399,578 401,415 396,150 384,568
Regular Savings
Accounts 111,600 115,955 119,585 124,970 125,500
Certificates of
Deposit 467,373 472,019 472,554 477,327 482,139
---------------------------------------------------------------------
Total Deposits 2,142,344 1,937,413 2,009,590 2,042,062 2,081,654
Short-Term
Borrowings 53,131 63,817 74,307 77,936 65,023
Subordinated Notes
Payable 62,887 62,887 62,887 62,887 62,887
Other Long-Term
Borrowings 26,731 29,725 41,276 42,879 43,083
Other Liabilities 38,559 47,031 41,251 41,841 29,493
---------------------------------------------------------------------
Total Liabilities 2,323,652 2,140,873 2,229,311 2,267,605 2,282,140
---------------------------------------------------------------------
SHAREOWNERS'
EQUITY
Common Stock 172 176 179 183 185
Additional Paid-In
Capital 38,243 50,789 58,001 71,366 80,654
Retained Earnings 260,325 255,876 251,838 246,959 243,242
Accumulated Other
Comprehensive
Loss, Net of Tax (6,065) (7,788) (8,581) (7,996) (8,311)
---------------------------------------------------------------------
Total Shareowners'
Equity 292,675 299,053 301,437 310,512 315,770
---------------------------------------------------------------------
Total Liabilities
and Shareowners'
Equity $ 2,616,327 2,439,926 2,530,748 2,578,117 2,597,910
---------------------------------------------------------------------
OTHER BALANCE
SHEET DATA
Earning Assets $ 2,272,829 2,108,096 2,197,688 2,251,119 2,270,410
Intangible Assets
Goodwill 84,811 84,811 84,811 84,811 84,811
Deposit Base 12,578 13,988 15,399 16,810 18,221
Other 1,179 1,227 1,275 1,323 1,370
Interest Bearing
Liabilities 1,852,434 1,674,600 1,731,074 1,757,889 1,762,633
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Book Value Per
Diluted Share $ 17.03 16.95 16.87 16.97 17.01
Tangible Book
Value Per
Diluted Share 11.30 11.28 11.19 11.34 11.39
---------------------------------------------------------------------
Actual Basic
Shares
Outstanding 17,183 17,628 17,869 18,287 18,518
Actual Diluted
Shares
Outstanding 17,184 17,639 17,869 18,297 18,562
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CAPITAL CITY BANK GROUP, INC.
ALLOWANCE FOR LOAN LOSSES
AND NONPERFORMING ASSETS
Unaudited
---------------------------------------------------------------------
2007 2006
--------------------------------------- --------
(Dollars in Fourth Third Second First Fourth
thousands) Quarter Quarter Quarter Quarter Quarter
------------------------------------------------------------ --------
ALLOWANCE FOR LOAN
LOSSES
Balance at Beginning
of Period $ 18,001 17,469 17,108 17,217 17,311
Provision for Loan
Losses 1,699 1,552 1,675 1,237 460
Net Charge-Offs 1,634 1,020 1,314 1,346 554
---------------------------------------------------------------------
Balance at End of
Period $ 18,066 18,001 17,469 17,108 17,217
---------------------------------------------------------------------
As a % of Loans 0.95% 0.95 0.91 0.87 0.86
As a % of
Nonperforming Loans 71.92 145.49 193.69 207.67 214.09
As a % of
Nonperforming
Assets 64.15 128.05 172.60 181.23 197.19
---------------------------------------------------------------------
CHARGE-OFFS
Commercial,
Financial and
Agricultural $ 370 279 253 560 81
Real Estate -
Construction 58 -- -- 108 --
Real Estate -
Commercial 133 245 5 326 54
Real Estate -
Residential 209 161 992 67 154
Consumer 1,302 854 534 761 787
---------------------------------------------------------------------
Total Charge-Offs $ 2,072 1,539 1,784 1,822 1,076
---------------------------------------------------------------------
RECOVERIES
Commercial,
Financial and
Agricultural $ 47 44 47 36 77
Real Estate -
Construction -- -- -- -- --
Real Estate -
Commercial 2 2 5 5 9
Real Estate -
Residential 5 2 26 3 1
Consumer 384 471 392 432 435
---------------------------------------------------------------------
Total Recoveries $ 438 519 470 476 522
---------------------------------------------------------------------
NET CHARGE-OFFS $ 1,634 1,020 1,314 1,346 554
---------------------------------------------------------------------
Net Charge-Offs as a
% of Average
Loans (a) 0.34% 0.21 0.27 0.28 0.11
---------------------------------------------------------------------
RISK ELEMENT ASSETS
Nonaccruing Loans $ 25,120 12,373 9,019 8,238 8,042
Restructured -- -- -- -- --
---------------------------------------------------------------------
Total Nonperforming
Loans 25,120 12,373 9,019 8,238 8,042
Other Real Estate 3,043 1,685 1,102 1,202 689
---------------------------------------------------------------------
Total Nonperforming
Assets $ 28,163 14,058 10,121 9,440 8,731
---------------------------------------------------------------------
Past Due Loans 90
Days or More $ 416 874 332 860 135
---------------------------------------------------------------------
Nonperforming Loans
as a % of Loans 1.31% 0.65 0.47 0.42 0.40
Nonperforming Assets
as a % of Loans and
Other Real Estate 1.47 0.74 0.52 0.48 0.44
Nonperforming Assets
as a % of Capital (b) 9.06 4.43 3.17 2.88 2.62
---------------------------------------------------------------------
(a) Annualized
(b) Capital includes allowance for loan losses.
AVERAGE BALANCE AND INTEREST RATES (a)
Unaudited
---------------------------------------------------------------------
Fourth Quarter 2007 Third Quarter 2007
---------------------------- ----------------------------
(Dollars in Average Average Average Average
thousands) Balance Interest Rate Balance Interest Rate
---------------------- ---------- ------ ---------- ---------- ------
ASSETS:
Loans, Net
of
Unearned
Interest $1,908,069 $ 37,969 7.89% 1,907,235 38,901 8.09
Investment
Securities
Taxable
Investment
Securities 99,055 1,226 4.93 102,618 1,224 4.75
Tax-Exempt
Investment
Securities 87,358 1,178 5.39 85,446 1,142 5.35
---------------------------------------------------------------------
Total
Investment
Securities 186,413 2,404 5.15 188,064 2,366 5.02
Funds Sold 96,748 1,064 4.31 49,438 639 5.06
---------------------------------------------------------------------
Total
Earning
Assets 2,191,230 $ 41,437 7.50% 2,144,737 41,906 7.75
---------------- ----------------
Cash and Due
From Banks 85,598 84,477
Allowance
For Loan
Losses (18,127) (17,664)
Other Assets 260,981 256,153
---------------------- ----------
Total
Assets $2,519,682 2,467,703
---------------------- ----------
LIABILITIES:
Interest
Bearing
Deposits
NOW
Accounts $ 608,347 $ 2,980 1.94% 525,795 2,531 1.91
Money
Market
Accounts 404,406 3,217 3.16 403,957 3,565 3.50
Savings
Accounts 113,527 57 0.20 117,451 70 0.24
Time
Deposits 471,454 5,069 4.27 471,868 5,100 4.29
---------------------------------------------------------------------
Total
Interest
Bearing
Deposits 1,597,734 11,323 2.81 1,519,071 11,266 2.94
Short-Term
Borrowings 64,842 639 3.89 65,130 734 4.45
Subordinated
Notes
Payable 62,887 936 5.91 62,887 936 5.91
Other Long-
Term
Borrowings 28,215 343 4.83 38,269 453 4.70
---------------------------------------------------------------------
Total
Interest
Bearing
Liabilities 1,753,678 $ 13,241 3.00% 1,685,357 13,389 3.15
---------------- ----------------
Noninterest
Bearing
Deposits 419,002 435,089
Other
Liabilities 47,660 45,721
---------------------- ----------
Total
Liabilities 2,220,340 2,166,167
SHAREOWNERS'
EQUITY: $ 299,342 301,536
---------------------- ----------
Total
Liabilities
and
Shareowners'
Equity $2,519,682 2,467,703
---------------------- ----------
Interest
Rate
Spread $ 28,196 4.50% 28,517 4.60
--------------------------------------- ----------------
Interest
Income and
Rate
Earned (b) $ 41,437 7.50 41,906 7.75
Interest
Expense and
Rate Paid
(b) 13,241 2.40 13,389 2.48
--------------------------------------- ----------------
Net Interest
Margin $ 28,196 5.10% 28,517 5.27
--------------------------------------- ----------------
---------------------------------------------------------------------
Second Quarter 2007 First Quarter 2007
---------------------------- ----------------------------
(Dollars in Average Average Average Average
thousands) Balance Interest Rate Balance Interest Rate
---------------------- ---------- ------ ---------- ---------- ------
ASSETS:
Loans, Net
of
Unearned
Interest $1,944,969 $ 39,300 8.10% 1,980,224 39,264 8.04
Investment
Securities
Taxable
Investment
Securities 105,425 1,236 4.68 108,377 1,263 4.67
Tax-Exempt
Investment
Securities 83,907 1,088 5.19 82,627 1,039 5.03
---------------------------------------------------------------------
Total
Investment
Securities 189,332 2,324 4.91 191,004 2,302 4.82
Funds Sold 52,935 689 5.15 40,332 521 5.17
---------------------------------------------------------------------
Total
Earning
Assets 2,187,236 $ 42,313 7.76% 2,211,560 42,087 7.71
---------------- ----------------
Cash and
Due From
Banks 88,075 88,679
Allowance
For Loan
Losses (17,263) (17,073)
Other
Assets 253,204 247,624
---------------------- ----------
Total
Assets $2,511,252 2,530,790
---------------------- ----------
LIABILITIES:
Interest
Bearing
Deposits
NOW
Accounts $ 541,525 $ 2,611 1.93% 552,303 2,626 1.93
Money
Market
Accounts 393,403 3,458 3.53 386,736 3,427 3.59
Savings
Accounts 122,560 74 0.24 125,419 78 0.25
Time
Deposits 474,761 4,955 4.19 480,964 4,869 4.11
---------------------------------------------------------------------
Total
Interest
Bearing
Deposits 1,532,249 11,098 2.91 1,545,422 11,000 2.89
Short-Term
Borrowings 66,764 737 4.41 68,911 761 4.46
Subordinated
Notes
Payable 62,887 932 5.94 62,887 926 5.97
Other Long-
Term
Borrowings 42,284 496 4.71 43,137 502 4.72
---------------------------------------------------------------------
Total
Interest
Bearing
Liabilities 1,704,184 $ 13,263 3.12% 1,720,357 13,189 3.11
---------------- ----------------
Noninterest
Bearing
Deposits 455,169 458,304
Other
Liabilities 42,547 35,645
---------------------- ----------
Total
Liabilities 2,201,900 2,214,306
SHAREOWNERS'
EQUITY: $ 309,352 $ 316,484
---------------------- ----------
Total
Liabilities
and
Shareowners'
Equity $2,511,252 $2,530,790
---------------------- ----------
Interest
Rate Spread $ 29,050 4.64% 28,898 4.60
--------------------------------------- ----------------
Interest
Income and
Rate
Earned (b) $ 42,313 7.76 42,087 7.71
Interest
Expense
and Rate
Paid (b) 13,263 2.43 13,189 2.42
--------------------------------------- ----------------
Net Interest
Margin $ 29,050 5.33% 28,898 5.29
--------------------------------------- ----------------
Fourth Quarter 2006
-----------------------------
Average Average
(Dollars in thousands) Balance Interest Rate
--------------------------------------- ---------- ---------- -------
ASSETS:
Loans, Net of Unearned Interest $2,003,719 $ 40,296 7.98%
Investment Securities
Taxable Investment Securities 108,041 1,263 4.66
Tax-Exempt Investment Securities 82,568 1,020 4.94
---------------------------------------------------------------------
Total Investment Securities 190,609 2,283 4.78
Funds Sold 43,738 576 5.15
---------------------------------------------------------------------
Total Earning Assets 2,238,066 $ 43,155 7.65%
------------------
Cash and Due From Banks 94,449
Allowance For Loan Losses (17,503)
Other Assets 242,345
--------------------------------------------------
Total Assets $2,557,357
--------------------------------------------------
LIABILITIES:
Interest Bearing Deposits
NOW Accounts $ 542,751 $ 2,522 1.84%
Money Market Accounts 391,346 3,488 3.54
Savings Accounts 128,027 76 0.24
Time Deposits 484,807 4,744 3.88
---------------------------------------------------------------------
Total Interest Bearing Deposits 1,546,931 10,830 2.78
Short-Term Borrowings 65,385 722 4.36
Subordinated Notes Payable 62,887 936 5.91
Other Long-Term Borrowings 43,453 515 4.71
---------------------------------------------------------------------
Total Interest Bearing Liabilities 1,718,656 $ 13,003 3.00%
------------------
Noninterest Bearing Deposits 481,522
Other Liabilities 33,276
--------------------------------------------------
Total Liabilities 2,233,454
SHAREOWNERS' EQUITY: $ 323,903
--------------------------------------------------
Total Liabilities and Shareowners'
Equity $2,557,357
--------------------------------------------------
Interest Rate Spread $ 30,152 4.65%
---------------------------------------------------------------------
Interest Income and Rate Earned (b) $ 43,155 7.65
Interest Expense and Rate Paid (b) 13,003 2.30
---------------------------------------------------------------------
Net Interest Margin $ 30,152 5.35%
---------------------------------------------------------------------
---------------------------------------------------------------------
Twelve Months Ended Twelve Months Ended
December 2007 December 2006
---------------------------- ----------------------------
(Dollars in Average Average Average Average
thousands) Balance Interest Rate Balance Interest Rate
---------------------- ---------- ------ ---------- ---------- ------
ASSETS:
Loans, Net
of Unearned
Interest $1,934,850 $ 155,434 8.03% 2,029,397 157,227 7.75
Investment
Securities
Taxable
Investment
Securities 103,840 4,949 4.76 112,392 4,851 4.31
Tax-Exempt
Investment
Securities 84,849 4,447 5.24 74,634 3,588 4.81
---------------------------------------------------------------------
Total
Investment
Securities 188,689 9,396 4.97 187,026 8,439 4.51
Funds Sold 59,989 2,913 4.79 41,854 2,039 4.81
---------------------------------------------------------------------
Total
Earning
Assets 2,183,528 $ 167,743 7.68% 2,258,277 167,705 7.42
---------------- ----------------
Cash and
Due From
Banks 86,692 100,237
Allowance
For Loan
Losses (17,535) (17,486)
Other
Assets 254,532 240,050
---------------------- ----------
Total
Assets $2,507,217 2,581,078
---------------------- ----------
LIABILITIES:
Interest
Bearing
Deposits
NOW
Accounts $ 557,060 $ 10,748 1.93% 518,671 7,658 1.48
Money
Market
Accounts 397,193 13,667 3.44 370,257 11,687 3.16
Savings
Accounts 119,700 279 0.23 134,033 278 0.21
Time
Deposits 474,728 19,993 4.21 507,283 17,630 3.48
---------------------------------------------------------------------
Total
Interest
Bearing
Deposits 1,548,681 44,687 2.89 1,530,244 37,253 2.43
Short-Term
Borrowings 66,397 2,871 4.31 78,700 3,075 3.89
Subordinated
Notes
Payable 62,887 3,730 5.93 62,887 3,724 5.92
Other Long-
Term
Borrowings 37,936 1,794 4.73 57,260 2,704 4.72
---------------------------------------------------------------------
Total
Interest
Bearing
Liabilities 1,715,901 $ 53,082 3.09% 1,729,091 46,756 2.70
---------------- ----------------
Noninterest
Bearing
Deposits 441,765 504,687
Other
Liabilities 42,934 29,964
---------------------- ----------
Total
Liabilities 2,200,600 2,263,742
SHAREOWNERS'
EQUITY: $ 306,617 317,336
---------------------- ----------
Total
Liabilities
and
Shareowners'
Equity $2,507,217 2,581,078
---------------------- ----------
Interest
Rate
Spread $ 114,661 4.59% 120,949 4.72
--------------------------------------- ----------------
Interest
Income and
Rate
Earned (b) $ 167,743 7.68 167,705 7.42
Interest
Expense and
Rate Paid
(b) 53,082 2.43 46,756 2.07
--------------------------------------- ----------------
Net Interest
Margin $ 114,661 5.25% 120,949 5.35
--------------------------------------- ----------------
(a) Interest and average rates are calculated on a tax-equivalent
basis using the 35% Federal tax rate.
(b) Rate calculated based on average earning assets.
CONTACT: Capital City Bank Group, Inc.
J. Kimbrough Davis, Executive Vice President and
Chief Financial Officer
850.402.7820
Released January 22, 2008