Capital City Bank Group, Inc.

Reports Fourth Quarter and Full Year 2013 Results

 

TALLAHASSEE, Fla. (January 28, 2014) – Capital City Bank Group, Inc. (Nasdaq: CCBG) today reported net income of $2.8 million, or $0.16 per diluted share for the fourth quarter of 2013, compared to net income of $1.6 million, or $0.09 per diluted share for the third quarter of 2013, and net income of $1.9 million, or $0.11 per diluted share, for the fourth quarter of 2012. For the full year 2013, the Company reported net income of $6.0 million, or $0.35 per diluted share, compared to net income of $0.1 million, or $0.01 per diluted share in 2012.

 

Compared to the third quarter of 2013, the increase in earnings reflects a lower loan loss provision of $0.2 million, an increase in noninterest income of $0.4 million, and lower income taxes of $0.9 million, partially offset by lower net interest income of $0.2 million and higher noninterest expense of $0.1 million. Compared to the fourth quarter of 2012, the increase in earnings was due to a lower loan loss provision of $2.4 million, higher noninterest income of $0.5 million, and lower income taxes of $0.6 million, partially offset by lower net interest income of $1.6 million and an increase in noninterest expense of $1.0 million.

 

For the full year 2013, the increase in earnings was driven by a lower loan loss provision of $12.7 million, higher noninterest income of $1.2 million, and lower noninterest expense of $1.8 million, partially offset by a reduction in net interest income of $6.6 million and higher income taxes of $3.2 million.

 

“Capital City finished the year strong with another quarter of consistent financial performance,” said William G. Smith, Chairman, President, and CEO of Capital City Bank Group. “While there is still work to be done, I am pleased with our continued progress. We reduced our nonperforming assets by 28%, grew earnings to $0.35 per share – up from $0.01 per share in 2012 – and rescinded our informal board resolutions, which are discussed further herein. Additionally, as of December 31, 2013, all deferred interest on our trust preferred securities was brought current. It is gratifying to know that we managed through this cycle without taking TARP or diluting our shareowners. Improving our credit quality will remain a primary area of focus in our 2014 strategy, as will continued efforts to right-size our expense base and identify new revenue opportunities. While the economic environment is improving, it is at a slow pace and we anticipate loan growth will remain challenging.  Our team has a lot of work ahead of us, but I am proud of our accomplishments and like our momentum as we head into 2014,” said Smith.

 

The Return on Average Assets was 0.43% and the Return on Average Equity was 4.33% for the fourth quarter of 2013. These metrics were 0.25% and 2.51% for the third quarter of 2013, and 0.29% and 2.95% for the fourth quarter of 2012, respectively.

 

For the full year of 2013, the Return on Average Assets was 0.24% and the Return on Average Equity was 2.40% compared to 0.00% and 0.04%, respectively, for 2012.

 

Discussion of Financial Condition

 

Average earning assets were $2.206 billion for the fourth quarter of 2013, an increase of $4.9 million, or 0.2%, from the third quarter of 2013 and an increase of $27.3 million, or 1.3%, over the fourth quarter of 2012.  The change in earning assets reflects an increase in short-term borrowings and a decline in other assets, partially offset by problem loan resolutions and lower deposits.

 

 

 
 

We maintained an average net overnight funds (deposits with banks plus fed funds sold less fed funds purchased) sold position of $411.6 million during the fourth quarter of 2013 compared to an average net overnight funds sold position of $412.1 million in the third quarter of 2013 and an average overnight funds sold position of $366.0 million in the fourth quarter of 2012.  The increase when compared to the fourth quarter of 2012 reflects the declining loan portfolio, partially offset by an increase in the investment portfolio.

 

Economic uncertainty and deleveraging by our clients continues to generate a historically high level of liquidity, which, given the current operating environment, is difficult to profitably deploy without taking inordinate risks. Where practical, we are working to lower the level of overnight funds by adding to our investment portfolio with short-duration securities and reducing deposit balances. We continue to use a fully-insured money market account which is offered by a third party and can serve as an alternative investment for some of our higher balance depositors while at the same time allowing us to maintain the account relationship. Until such time that attractive investment alternatives arise, we will continue to execute these strategies as well as seek other initiatives in an effort to lower our overnight fund balances.

 

When compared to the third quarter of 2013 and fourth quarter of 2012, average loans declined by $21.1 million and $103.4 million, respectively. Most loan categories have experienced declines with the reduction primarily in the commercial real estate and residential real estate categories. Our core loan portfolio continues to be impacted by normal amortization and payoffs that have outpaced our new loan production.

 

New loan production for 2013 was higher than 2012 as our efforts to stimulate loan growth are ongoing. Without compromising our credit standards or taking on inordinate interest rate risk, we have modified several lending programs in our business and commercial real estate areas to try and mitigate the significant impact that consumer and business deleveraging is having on our portfolio.

 

Nonperforming assets (nonaccrual loans and other real estate (“OREO”) totaled $85.0 million at year-end 2013, a decrease of $9.7 million, or 10.2% from the third quarter of 2013 and $32.6 million, or 27.7% from year-end 2012. Nonaccrual loans totaled $37.0 million at year-end 2013, a decrease of $4.7 million from the third quarter of 2013 and a decrease of $27.3 million from year-end 2012. Nonaccrual loan additions totaled $14.5 million in the fourth quarter of 2013 and $44.1 million for the full year 2013, which compares to $12.5 million and $61.1 million, respectively, for the same periods of 2012. The balance of OREO totaled $48.1 million at year-end 2013, a decrease of $4.9 million from the third quarter of 2013 and $5.4 million from year-end 2012. For the fourth quarter of 2013 we added properties totaling $3.5 million, sold properties totaling $7.4 million, recorded valuation adjustments totaling $0.8 million, and realized miscellaneous reductions totaling $0.2 million. For the full year 2013, we added properties totaling $24.5 million, sold properties totaling $25.9 million, recorded valuation adjustments totaling $3.6 million, and realized miscellaneous adjustments totaling $0.3 million. Nonperforming assets represented 3.26% of total assets at December 31, 2013, 3.77% at September 30, 2013, and 4.47% at December 31, 2012.

 

Average total deposits were $2.051 billion for the fourth quarter of 2013, a decrease of $8.6 million, or 0.4%, from the third quarter of 2013 and $0.2 million, or 0.01%, over the fourth quarter of 2012.  The decrease in deposits when compared to the third quarter of 2013 resulted primarily from the reduction in noninterest bearing demand accounts and money market accounts, partially offset by higher public funds and savings accounts. When compared to the fourth quarter of 2012, the slight decrease was a result of lower certificates of deposit and regular NOWs, partially offset by higher public funds and savings accounts.

 

 
 

The seasonal inflow of public funds started in the fourth quarter of 2013 and will continue through the first quarter of 2014. This is anticipated to increase the overnight funds position during the first quarter. Our mix of deposits continues to improve as higher cost certificates of deposit are replaced with lower rate non-maturity deposits and noninterest bearing demand accounts.  Our strategy is to manage the mix of our deposits rather than compete on rate, which enables us to maintain an exceptionally low cost of funds – 19 basis points in the fourth quarter and 20 basis points for the year 2013.

 

When compared to the third quarter of 2013 and fourth quarter of 2012, average borrowings increased by $7.1 million and $9.2 million, respectively, primarily as a result of higher repurchase agreement balances, partially offset by FHLB advance payoffs/amortization.

 

Equity capital was $276.4 million as of December 31, 2013, compared to $251.2 million as of September 30, 2013 and $246.9 million as of December 31, 2012. Our leverage ratio was 10.46%, 10.16%, and 9.90%, respectively, for these periods. Further, our risk-adjusted capital ratio of 17.94% at December 31, 2013 compares to 15.72% at December 31, 2012, and significantly exceeds the 10.0% threshold to be designated as “well-capitalized” under the risk-based regulatory guidelines. At December 31, 2013, our tangible common equity ratio was 7.58%, compared to 6.84% at September 30, 2013 and 6.35% at December 31, 2012. The increase in our tangible common equity ratio in the fourth quarter of 2013 was due to earnings and a favorable adjustment in the pension component of our other comprehensive income. The favorable adjustment in the pension component reflects (1) an increase in the plan discount rate, which drives a reduction in pension liabilities, and (2) an increase in the market value of plan assets.

 

Discussion of Operating Results

 

Tax equivalent net interest income for the fourth quarter of 2013 was $19.2 million compared to $19.4 million for the third quarter of 2013 and $20.7 million for the fourth quarter of 2012.  The decrease in tax equivalent net interest income compared to the prior periods was due to a reduction in loan income, primarily attributable to declining loan balances and unfavorable asset repricing, partially offset by a lower level of foregone interest on loans and higher loan fees.  For the full year 2013, tax equivalent net interest income totaled $78.3 million compared to $85.0 million for 2012 with the decline attributable to the factors mentioned above, partially offset by a reduction in the cost of funds.

 

Pressure on net interest income continues primarily as a result of the declining loan portfolio and the low rate environment.  Period end loan balances have declined by approximately $121.6 million since the fourth quarter of 2012. The low rate environment, although favorable to the repricing of deposits, continues to negatively impact the loan and investment portfolios. Increased lending competition in all markets has also unfavorably impacted the pricing for loans.

 

Lowering our cost of funds, to the extent we can, and continuing to shift the mix of our deposits will help to partially mitigate the unfavorable impact of weak loan demand and repricing, although the impact is expected to be minimal. 

 

The net interest margin for the fourth quarter of 2013 was 3.45%, a decrease of four basis points from the third quarter of 2013, and a decline of 33 basis points from the fourth quarter of 2012.  The decrease in the margin for both comparable periods was attributable to the shift in our earning asset mix and unfavorable asset repricing. The average cost of funds was lower in the fourth quarter of 2013 when compared to the fourth quarter of 2012 by three basis points and remained unchanged from the third quarter of 2013.

 

 

 
 

The provision for loan losses for the fourth quarter of 2013 was $0.4 million compared to $0.6 million in the third quarter of 2013 and $2.8 million for the fourth quarter of 2012. For the full year 2013, the loan loss provision totaled $3.5 million compared to $16.2 million for 2012. The lower level of provision reflects continued favorable problem loan migration, lower loan losses, and overall improvement in key credit metrics. Net charge-offs for the fourth quarter of 2013 totaled $2.3 million, or 0.65% (annualized), of average loans compared to $2.8 million, or 0.78% (annualized), for the third quarter of 2013 and $3.8 million, or 1.00% (annualized), in the fourth quarter of 2012. For the full year 2013, net charge-offs totaled $9.5 million, or 0.66%, of average loans compared to $18.0 million, or 1.16%, for the same period of 2012. Lower charge-offs in our residential real estate and commercial real estate portfolios drove the decrease in loan losses comparing 2013 to 2012. At December 31, 2013, the allowance for loan losses of $23.1 million was 1.65% of outstanding loans (net of overdrafts) and provided coverage of 62% of nonperforming loans compared to 1.75% and 60%, respectively, at September 30, 2013, and 1.93% and 45%, respectively, at December 31, 2012.

 

Noninterest income for the fourth quarter of 2013 totaled $14.7 million, an increase of $0.4 million, or 2.6%, over the third quarter of 2013. The increase over the third quarter of 2013 reflects higher other income of $0.6 million and an increase in wealth management fees of $0.1 million, partially offset by lower mortgage banking fees of $0.2 million and deposit fees of $0.1 million. The increase in other income was driven by gains from the sale of OREO properties and the increase in wealth management fees was primarily due to improved account values for managed accounts on which fees are based. Mortgage banking fees declined due to a reduction in refinancing volume, which is attributable to the higher rate environment. The reduction in deposit fees was attributable to a slightly lower level of overdraft fees. Compared to the fourth quarter of 2012, noninterest income increased $0.6 million, or 3.9%, due to higher wealth management fees of $0.4 million, other income of $0.7 million, and bank card fees of $0.1 million, partially offset by lower deposit fees of $0.4 million and mortgage banking fees of $0.2 million. The increase in wealth management fees reflects increased retail client trading activity and growth in new accounts. A higher level of gains from the sale of OREO properties drove the increase in other income. Slightly higher spend volume drove the increase in bank card fees. The reduction in deposit fees was attributable to lower overdraft fees that were partially offset by a reduction in checking account losses. Mortgage banking fees declined due to a slowdown in refinancing volume that was partially offset by an increase in margin from sold loans. For the full year 2013, noninterest income totaled $56.4 million, a $1.2 million, or 2.2%, increase over 2012 due to higher wealth management fees of $1.0 million and other income of $0.9 million, partially offset by lower deposit fees of $0.5 million and mortgage banking fees of $0.1 million. Wealth management fees increased due to higher retail brokerage fees reflective of increased client trading activity and growth in new account openings. A higher level of gains from the sale of OREO properties drove the increase in other income. Deposit fees declined due to a lower level of overdraft fees, partially offset by higher business account analysis fees. Mortgage banking fees declined due to a slowdown in refinancing volume that was partially offset by an increase in margin from sold loans.

 

Noninterest expense for the fourth quarter of 2013 totaled $30.5 million, an increase of $0.1 million, or 0.2%, over the third quarter of 2013 attributable to higher compensation expense of $0.4 million, partially offset by lower other expense of $0.3 million. The increase in compensation was attributable to higher pension plan expense of $0.3 million and stock compensation expense of $0.1 million. The reduction in other expense was due to lower professional fees of $0.2 million and advertising fees of $0.1 million. The higher level of pension expense reflects a cumulative adjustment made in the third quarter to reduce year-to-date pension expense to reflect the final numbers as provided by our actuaries. Stock compensation expense increased due to a higher level of performance for our stock award plans. The reduction in professional fees reflects a decrease in internal audit fees and consulting engagement fees. Higher costs in the third quarter due to the roll-out of our mobile remote deposit capture product drove the favorable variance in advertising fees. Compared to the fourth quarter of 2012, noninterest expense increase by $1.0 million, or 3.5%, primarily attributable to higher compensation expense of $0.8 million and OREO expense of $0.2 million. The increase in compensation reflects a $0.4 million increase in expense for cash based incentive plans, and higher pension plan expense of $0.3 million and stock compensation expense of $0.1 million. A higher level of valuation adjustments for OREO properties drove the increase in OREO expense. The increase in pension plan expense reflects the utilization of a lower discount rate assumption for our pension plans and the increase in stock compensation was driven by a higher level of company performance. For the full year 2013, noninterest expense totaled $122.7 million, a decrease of $1.8 million, or 1.5% from 2012, reflective of declines in OREO expense of $1.9 million, other expense of $0.9 million, occupancy of $0.7 million, and intangible amortization expense of $0.2 million, partially offset by higher compensation of $1.9 million. OREO expense decreased due to lower carrying costs and valuation adjustments reflecting improving property values in our markets. Lower legal fees supporting loan collection as well as a decline in professional fees drove the reduction in other expense. Declines were realized in most of the occupancy expense categories and were generally driven by stronger cost controls and other cost reduction initiatives. The decrease in intangible amortization reflects the full amortization of our remaining core deposit intangible asset in early 2013. The higher level of compensation expense was attributable to an increase in our pension plan expense of $1.0 million and stock compensation expense of $0.9 million, both due to the same aforementioned reasons.

 

 
 

We realized income tax expense of $5,000 in the fourth quarter of 2013 compared to $0.9 million for the third quarter of 2013 and $0.6 million for the fourth quarter of 2012.  The resolution of certain tax contingencies in the fourth quarter of 2013 and 2012 favorably impacted income tax expense. For the full year 2013, we realized income tax expense of $1.9 million compared to an income tax benefit of $1.3 million for 2012.  The increase in the tax provision year over year was driven by higher operating profits.

 

Regulatory Matter

 

During the fourth quarter of 2013, the Company rescinded the informal board resolutions adopted by the Company’s Board of Directors in February 2010 at the request of the Federal Reserve. In addition, the informal board resolutions previously adopted by Capital City Bank’s Board of Directors in April 2012, at the request of the Federal Reserve, was also rescinded. These sets of board resolutions had restricted Capital City Bank’s ability to declare or pay dividends to the Company and had restricted the Company’s ability to incur any new debt or refinance existing debt, declare any dividends on its common stock, make payments on its trust preferred securities, and redeem shares of its common stock. By rescinding both sets of board resolutions, the Company and the Capital City Bank are no longer operating under these restrictions. While we remain committed to resuming dividend payments to our shareowners, our Board of Directors has not made any decision as to when dividend payments will resume.

 

About Capital City Bank Group, Inc.

 

Capital City Bank Group, Inc. (Nasdaq: CCBG) is one of the largest publicly traded bank holding 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 63 full-service offices and 71 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, including the estimate used for the Company’s loan loss provision and deferred tax valuation allowance; legislative or regulatory changes, including the Dodd-Frank Act and Basel III; the strength of the U.S. economy and the local economies where the Company conducts operations; the frequency and magnitude of foreclosure of the Company’s loans; restrictions on our 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; fluctuations in inflation, interest rates, or monetary policies; 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; the effects of security breaches and computer viruses that may affect the Company’s computer systems; the Company’s need and our ability to incur additional debt or equity financing; a decrease to the market value of the Company that could result in an impairment of goodwill; changes in consumer spending and savings habits; the Company’s growth and profitability; 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, 2012, 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.

 

 
 

CAPITAL CITY BANK GROUP, INC.

EARNINGS HIGHLIGHTS

Unaudited 

      Three Months Ended  Twelve Months Ended
(Dollars in thousands, except per share data)  Dec 31, 2013  Sep 30, 2013  Dec 31, 2012  Dec 31, 2013  Dec 31, 2012
EARNINGS                         
Net Income  $2,772   $1,591   $1,874   $6,045   $108 
Net Income Per Common Share  $0.16   $0.09   $0.11   $0.35   $0.01 
PERFORMANCE                         
Return on Average Assets   0.43%   0.25%   0.29%   0.24%   0.00%
Return on Average Equity   4.33%   2.51%   2.95%   2.40%   0.04%
Net Interest Margin   3.45%   3.49%   3.78%   3.54%   3.81%
Noninterest Income as % of Operating Revenue   43.85%   42.82%   40.81%   42.25%   39.66%
Efficiency Ratio   90.22%   90.42%   84.68%   91.09%   88.72%
CAPITAL ADEQUACY                         
Tier 1 Capital Ratio   16.56%   15.60%   14.35%   16.56%   14.35%
Total Capital Ratio   17.94%   16.97%   15.72%   17.94%   15.72%
Tangible Common Equity Ratio   7.58%   6.84%   6.35%   7.58%   6.35%
Leverage Ratio   10.46%   10.16%   9.90%   10.46%   9.90%
Equity to Assets   10.58%   9.99%   9.37%   10.58%   9.37%
ASSET QUALITY                         
Allowance as % of Non-Performing Loans   62.48%   60.00%   45.42%   62.48%   45.42%
Allowance as a % of Loans   1.65%   1.75%   1.93%   1.65%   1.93%
Net Charge-Offs as % of Average Loans   0.65%   0.78%   1.00%   0.66%   1.16%
Nonperforming Assets as % of Loans and ORE   5.87%   6.38%   7.47%   5.87%   7.47%
Nonperforming Assets as % of Total Assets   3.26%   3.77%   4.47%   3.26%   4.47%
STOCK PERFORMANCE                         
High  $12.69   $13.08   $11.91   $13.08   $11.91 
Low   11.33    11.06    9.04    10.12    6.35 
Close   11.77    11.78    11.37    11.77    11.37 
Average Daily Trading Volume  $28,682   $18,380   $20,045   $21,708   $26,622 

 

 
 

CAPITAL CITY BANK GROUP, INC.

CONSOLIDATED STATEMENT OF FINANCIAL CONDITION

Unaudited 

   2013  2012
(Dollars in thousands)  Fourth Quarter  Third Quarter  Second Quarter  First Quarter  Fourth Quarter
ASSETS                         
Cash and Due From Banks  $55,209   $51,136   $67,811   $52,677   $66,238 
Funds Sold and Interest Bearing Deposits   474,719    358,869    391,457    461,714    443,494 
Total Cash and Cash Equivalents   529,928    410,005    459,268    514,391    509,732 
                          
Investment Securities - Available-for-Sale   251,420    271,838    350,614    307,502    296,985 
Investment Securities - Held-to-Maturity   148,211    97,309             
Total Investment Securities   399,631    369,147    350,614    307,502    296,985 
                          
Loans Held for Sale   11,065    13,822    15,362    11,422    14,189 
                          
Loans, Net of Unearned Interest                         
Commercial, Financial, & Agricultural   126,607    123,253    126,931    125,905    139,850 
Real Estate - Construction   31,012    31,454    35,823    37,948    37,512 
Real Estate - Commercial   533,871    570,736    581,501    599,517    613,625 
Real Estate - Residential   303,618    305,811    302,254    304,786    310,439 
Real Estate - Home Equity   227,922    230,212    232,530    233,205    236,263 
Consumer   156,718    148,321    142,620    146,043    150,728 
Other Loans   6,074    5,220    5,904    5,187    11,547 
Overdrafts   2,782    2,835    2,554    2,307    7,149 
Total Loans, Net of Unearned Interest   1,388,604    1,417,842    1,430,117    1,454,898    1,507,113 
Allowance for Loan Losses   (23,095)   (25,010)   (27,294)   (27,803)   (29,167)
Loans, Net   1,365,509    1,392,832    1,402,823    1,427,096    1,477,946 
                          
Premises and Equipment, Net   103,385    103,702    104,743    105,883    107,092 
Intangible Assets   84,843    84,891    84,937    84,985    85,053 
Other Real Estate Owned   48,071    53,018    55,087    58,421    53,426 
Other Assets   69,471    87,055    89,024    95,613    89,561 
Total Other Assets   305,770    328,666    333,791    344,902    335,132 
                          
Total Assets  $2,611,903   $2,514,472   $2,561,858   $2,605,313   $2,633,984 
                          
LIABILITIES                         
Deposits:                         
Noninterest Bearing Deposits  $641,463   $626,114   $644,739   $616,017   $609,235 
NOW Accounts   794,746    668,240    706,101    765,030    842,435 
Money Market Accounts   268,449    283,338    287,340    299,118    267,766 
Regular Savings Accounts   211,668    211,174    204,594    200,492    184,541 
Certificates of Deposit   219,922    228,020    228,349    233,325    241,019 
Total Deposits   2,136,248    2,016,886    2,071,123    2,113,982    2,144,996 
                          
Short-Term Borrowings   51,321    51,918    46,081    50,682    47,435 
Subordinated Notes Payable   62,887    62,887    62,887    62,887    62,887 
Other Long-Term Borrowings   38,043    40,244    41,251    41,224    46,859 
Other Liabilities   47,004    91,369    91,227    87,930    84,918 
                          
Total Liabilities   2,335,503    2,263,304    2,312,569    2,356,705    2,387,095 
                          
SHAREOWNERS' EQUITY                         
Common Stock   174    173    173    173    172 
Additional Paid-In Capital   41,152    40,481    40,210    39,580    38,707 
Retained Earnings   243,614    240,842    239,251    238,408    237,569 
Accumulated Other Comprehensive Loss, Net of Tax   (8,540)   (30,328)   (30,345)   (29,553)   (29,559)
                          
Total Shareowners' Equity   276,400    251,168    249,289    248,608    246,889 
                          
Total Liabilities and Shareowners' Equity  $2,611,903   $2,514,472   $2,561,858   $2,605,313   $2,633,984 
                          
OTHER BALANCE SHEET DATA                         
Earning Assets  $2,274,019   $2,159,680   $2,187,549   $2,235,537   $2,261,781 
Intangible Assets                         
Goodwill   84,811    84,811    84,811    84,811    84,811 
Core Deposits                   19 
Other   32    80    126    174    223 
Interest Bearing Liabilities   1,647,036    1,545,821    1,576,601    1,652,758    1,692,942 
                          
Book Value Per Diluted Share  $15.85   $14.44   $14.36   $14.35   $14.31 
Tangible Book Value Per Diluted Share   10.98    9.56    9.47    9.44    9.38 
                          
Actual Basic Shares Outstanding   17,361    17,336    17,336    17,319    17,232 
Actual Diluted Shares Outstanding   17,443    17,396    17,372    17,326    17,259 

 
 

CAPITAL CITY BANK GROUP, INC.

CONSOLIDATED STATEMENT OF OPERATIONS

Unaudited

                  Twelve Months Ended
   2013  2012  December 31,
(Dollars in thousands, except per share data)  Fourth Quarter  Third Quarter  Second Quarter  First Quarter  Fourth Quarter  2013  2012
INTEREST INCOME                                   
Interest and Fees on Loans  $19,057   $19,264   $19,709   $20,154   $20,756   $78,184   $85,394 
Investment Securities   760    717    710    704    808    2,891    3,340 
Funds Sold   259    269    279    270    223    1,077    946 
Total Interest Income   20,076    20,250    20,698    21,128    21,787    82,152    89,680 
                                    
INTEREST EXPENSE                                   
Deposits   314    335    367    415    429    1,431    2,108 
Short-Term Borrowings   46    46    61    82    69    235    196 
Subordinated Notes Payable   400    339    342    339    351    1,420    1,477 
Other Long-Term Borrowings   320    330    333    347    383    1,330    1,587 
Total Interest Expense   1,080    1,050    1,103    1,183    1,232    4,416    5,368 
Net Interest Income   18,996    19,200    19,595    19,945    20,555    77,736    84,312 
Provision for Loan Losses   397    555    1,450    1,070    2,766    3,472    16,166 
Net Interest Income after Provision for Loan Losses   18,599    18,645    18,145    18,875    17,789    74,264    68,146 
                                    
NONINTEREST INCOME                                   
Deposti Fees   6,398    6,474    6,217    6,165    6,764    25,254    25,792 
Bank Card Fees   2,656    2,715    2,754    2,661    2,612    10,786    10,783 
Wealth Management Fees   2,233    2,130    1,901    1,915    1,818    8,179    7,181 
Mortgage Banking Fees   654    869    968    1,043    910    3,534    3,600 
Data Processing Fees   689    662    670    653    671    2,674    2,713 
Securities Transactions   3                    3     
Other   2,040    1,456    1,339    1,151    1,343    5,986    5,116 
Total Noninterest Income   14,673    14,306    13,849    13,588    14,118    56,416    55,185 
                                    
NONINTEREST EXPENSE                                   
Compensation   16,583    16,158    16,647    16,739    15,772    66,127    64,242 
Occupancy, Net   4,349    4,403    4,161    4,418    4,429    17,331    18,055 
Intangible Amortization   48    46    48    68    108    210    431 
Other Real Estate   2,099    2,148    2,408    2,884    1,900    9,539    11,428 
Other   7,416    7,678    7,318    7,091    7,259    29,503    30,403 
Total Noninterest Expense   30,495    30,433    30,582    31,200    29,468    122,710    124,559 
                                    
OPERATING PROFIT (LOSS)   2,777    2,518    1,412    1,263    2,439    7,970    (1,228)
Income Tax Expense (Benefit)   5    927    569    424    564    1,925    (1,336)
NET INCOME  $2,772   $1,591   $843   $839   $1,875   $6,045   $108 
                                    
PER SHARE DATA                                   
Basic Income  $0.16   $0.09   $0.05   $0.05   $0.11   $0.35   $0.01 
Diluted Income  $0.16   $0.09   $0.05   $0.05   $0.11   $0.35   $0.01 
AVERAGE SHARES                                   
Basic   17,341    17,336    17,319    17,302    17,229    17,325    17,205 
Diluted   17,423    17,396    17,355    17,309    17,256    17,399    17,220 

 

 
 

CAPITAL CITY BANK GROUP, INC.

ALLOWANCE FOR LOAN LOSSES AND NONPERFORMING ASSETS

Unaudited 

   2013  2013  2013  2013  2012
(Dollars in thousands, except per share data)  Fourth Quarter  Third Quarter  Second Quarter  First Quarter  Fourth Quarter
ALLOWANCE FOR LOAN LOSSES                         
Balance at Beginning of Period  $25,010   $27,294   $27,803   $29,167   $30,222 
Provision for Loan Losses   397    555    1,450    1,070    2,766 
Net Charge-Offs   2,312    2,839    1,959    2,434    3,821 
Balance at End of Period  $23,095   $25,010   $27,294   $27,803   $29,167 
As a % of Loans   1.65%   1.75%   1.89%   1.90%   1.93%
As a % of Nonperforming Loans   62.48%   60.00%   65.66%   61.17%   45.42%
                          
CHARGE-OFFS                         
Commercial, Financial and Agricultural  $337   $138   $119   $154   $166 
Real Estate - Construction   72    278    110    610    227 
Real Estate - Commercial   676    882    1,050    1,043    468 
Real Estate - Residential   921    1,178    1,053    683    2,877 
Real Estate - Home Equity   362    362    322    113    745 
Consumer   430    674    351    296    488 
Total Charge-Offs  $2,798   $3,512   $3,005   $2,899   $4,971 
                          
RECOVERIES                         
Commercial, Financial and Agricultural  $33   $87   $38   $51   $87 
Real Estate - Construction   —      1    —      —      7 
Real Estate - Commercial   14    167    144    38    468 
Real Estate - Residential   179    167    396    96    83 
Real Estate - Home Equity   39    13    224    18    250 
Consumer   221    238    244    262    255 
Total Recoveries  $486   $673   $1,046   $465   $1,150 
                          
NET CHARGE-OFFS  $2,312   $2,839   $1,959   $2,434   $3,821 
                          
Net Charge-Offs as a % of Average Loans(1)   0.65%   0.78%   0.54%   0.66%   1.00%
                          
RISK ELEMENT ASSETS                         
Nonaccruing Loans  $36,964   $41,682   $41,566   $45,448   $64,222 
Other Real Estate Owned   48,071    53,018    55,087    58,421    53,426 
Total Nonperforming Assets  $85,035   $94,700   $96,653   $103,869   $117,648 
                          
Past Due Loans 30-89 Days  $7,746   $8,427   $9,017   $9,274   $9,934 
Past Due Loans 90 Days or More                    
Performing Troubled Debt Restructuring's  $44,764   $50,692   $52,729   $53,108   $47,474 
                          
Nonperforming Loans as a % of Loans   2.64%   2.91%   2.88%   3.10%   4.22%
Nonperforming Assets as a % of                         
Loans and Other Real Estate   5.87%   6.38%   6.44%   6.81%   7.47%
Nonperforming Assets as a % of Total Assets   3.26%   3.77%   3.77%   3.99%   4.47%

 

(1) Annualized

 

 
 

CAPITAL CITY BANK GROUP, INC.

AVERAGE BALANCE AND INTEREST RATES(1)

Unaudited

       Fourth Quarter 2013 Third Quarter 2013 Second Quarter 2013 First Quarter 2013 Fourth Quarter 2012 Dec 2013 YTD Dec 2012 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  $1,414,909    19,121    5.36%  $1,436,039    19,345    5.34%  $1,456,904    19,790    5.45%  $1,496,432    20,228    5.48%  $1,518,280    20,837    5.46%  $1,450,806   $78,484    5.41%  $1,556,565   $85,780    5.51%
                                                                                                          
Investment Securities                                                                                                         
Taxable Investment Securities   255,298    608    0.86    232,094    568    0.95    225,770    578    1.02    215,087    590    1.10    219,985    697    1.26    232,173    2,344    0.94    223,429    2,912    1.27 
Tax-Exempt Investment Securities   124,501    233    0.74    121,119    223    0.73    104,981    200    0.76    80,946    174    0.86    74,647    172    0.92    108,042    830    0.76    65,560    658    1.00 
                                                                                                          
Total Investment Securities   379,799    841    0.88    353,213    791    0.89    330,751    778    0.94    296,033    764    1.04    294,632    869    1.17    340,215    3,174    0.93    288,989    3,570    1.23 
                                                                                                          
Funds Sold   411,578    259    0.25    412,138    269    0.26    419,039    279    0.27    448,424    270    0.24    366,034    223    0.24    422,665    1,077    0.25    384,067    946    0.25 
                                                                                                          
Total Earning Assets   2,206,286   $20,221    3.64%   2,201,390   $20,405    3.68%   2,206,694   $20,847    3.79%   2,240,889   $21,262    3.85%   2,178,946   $21,929    4.00%   2,213,686   $82,735    3.74%   2,229,621   $90,296    4.05%
                                                                                                          
Cash and Due From Banks   48,519              51,640              49,081              50,679              51,344              49,978              48,924           
Allowance for Loan Losses   (25,612)             (27,636)             (29,012)             (30,467)             (30,605)             (28,167)             (30,959)          
Other Assets   324,460              333,001              337,765              337,579              334,326              333,165              342,587           
                                                                                                          
Total Assets  $2,553,653             $2,558,395             $2,564,528             $2,598,680             $2,534,011             $2,568,662             $2,590,173           
                                                                                                          
LIABILITIES:                                                                                                         
Interest Bearing Deposits                                                                                                         
NOW Accounts  $697,468   $95    0.05%  $676,855   $107    0.06%  $716,459   $124    0.07%  $788,660   $156    0.08%  $714,682   $131    0.07%  $719,493   $482    0.07%  $771,617   $634    0.08%
Money Market Accounts   279,608    50    0.07    284,920    53    0.07    289,637    54    0.07    282,847    54    0.08    275,458    57    0.08    284,245    211    0.07    280,165    255    0.09 
Savings Accounts   211,761    27    0.05    207,631    26    0.05    202,784    25    0.05    193,033    23    0.05    182,760    23    0.05    203,864    101    0.05    175,712    87    0.05 
Time Deposits   224,500    142    0.25    231,490    149    0.26    231,134    164    0.29    238,441    182    0.31    247,679    218    0.35    231,354    637    0.28    267,263    1,132    0.42 
Total Interest Bearing Deposits   1,413,337    314    0.09%   1,400,896    335    0.09%   1,440,014    367    0.10%   1,502,981    415    0.11%   1,420,579    429    0.12%   1,438,956    1,431    0.10%   1,494,757    2,108    0.14%
                                                                                                          
Short-Term Borrowings   58,126    46    0.31%   49,919    46    0.37%   52,399    61    0.47%   55,255    82    0.60%   45,893    69    0.59%   53,922    235    0.44%   52,178    196    0.38%
Subordinated Notes Payable   62,887    400    2.49    62,887    339    2.11    62,887    342    2.15    62,887    339    2.15    62,887    351    2.19    62,887    1,420    2.23    62,887    1,477    2.31 
Other Long-Term Borrowings   39,676    320    3.19    40,832    330    3.21    40,942    333    3.26    42,898    347    3.29    42,673    383    3.57    41,077    1,330    3.24    41,513    1,587    3.82 
                                                                                                          
Total Interest Bearing Liabilities   1,574,026   $1,080    0.27%   1,554,534   $1,050    0.27%   1,596,242   $1,103    0.28%   1,664,021   $1,183    0.29%   1,572,032   $1,232    0.31%   1,596,842   $4,416    0.28%   1,651,335   $5,368    0.33%
                                                                                                          
Noninterest Bearing Deposits   637,533              658,602              627,633              599,986              630,520              631,117              610,915           
Other Liabilities   88,095              93,642              90,168              85,116              78,442              89,276              74,963           
                                                                                                          
Total Liabilities   2,299,654              2,306,778              2,314,043              2,349,123              2,280,994              2,317,235              2,337,213           
                                                                                                          
SHAREOWNERS' EQUITY:   253,999              251,617              250,485              249,557              253,017              251,427              252,960           
                                                                                                          
Total Liabilities and Shareowners' Equity  $2,553,653             $2,558,395             $2,564,528             $2,598,680             $2,534,011             $2,568,662             $2,590,173           
                                                                                                          
Interest Rate Spread       $19,141    3.36%       $19,355    3.41%       $19,744    3.51%       $20,079    3.56%       $20,697    3.69%       $78,319    3.46%       $84,928    3.72%
                                                                                                          
Interest Income and Rate Earned(1)        20,221    3.64         20,405    3.68         20,847    3.79         21,262    3.85         21,929    4.00         82,735    3.74         90,296    4.05 
Interest Expense and Rate Paid(2)        1,080    0.19         1,050    0.19         1,103    0.20         1,183    0.21         1,232    0.22         4,416    0.20         5,368    0.24 
                                                                                                          
Net Interest Margin       $19,141    3.45%       $19,355    3.49%       $19,744    3.59%       $20,079    3.64%       $20,697    3.78%       $78,319    3.54%       $84,928    3.81%

 

(1) Interest and average rates are calculated on a tax-equivalent basis using the 35% Federal tax rate.

(2) Rate calculated based on average earning assets.