COLONY BANKCORP INC
For the period ended Jun 30, 2025. Filed Aug 8, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2025 · Filed Aug 8, 2025
CBAN$20.24+1.5%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-03-31; filed 2025-05-09.
0000711669-25-000067
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-06-30; filed 2025-08-08.
0000711669-25-000145
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 157 previous paragraphs and 163 current paragraphs.
109 unchanged; 44 reworded; 9 added; 4 removed; 0 previous and 1 current paragraphs rearranged.
Tables are not compared: 11 previous and 12 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (9)
Current report
•the risks related to the Proposed Merger, without limitation: (a) the risk that the cost savings and any revenue synergies from the Proposed Merger is less than or different from expectations, (b) disruption from the Proposed Merger with customer, supplier, or employee relationships, (c) the occurrence of any event, change, or other circumstances that could give rise to the termination of the Agreement and Plan of Merger by and between the Company and TCBC, (d) the failure to obtain necessary regulatory approvals for the Proposed Merger, (e) the failure to obtain the approval of the Company's and TCBC's shareholders in connection with the Proposed Merger, (f) the possibility that the costs, fees, expenses and charges related to the Proposed Merger may be greater than anticipated, including as a result of unexpected or unknown factors, events, or liabilities, (g) the failure of the conditions to the Proposed Merger to be satisfied, (h) the risks related to the integration of the combined businesses, including the risk that the integration will be materially delayed or will be more costly or difficult than expected, (i) the diversion of management time on merger-related issues, (j) the ability of the Company to effectively manage the larger and more complex operations of the combined company following the Proposed Merger, (k) the risks associated with the Company's pursuit of future acquisitions, (l) the risk of expansion into new geographic or product markets, (m) reputational risk and the reaction of the parties' customers to the Proposed Merger, (n) the Company's ability to successfully execute its various business strategies, including its ability to execute on potential acquisition opportunities, (o) the risk of potential litigation or regulatory action related to the Proposed Merger, and (p) general competitive, economic, political, and market conditions;
Current report
Proposed Acquisition of TC Bancshares, Inc. and TC Federal Bank
Current report
The Company and TC Bancshares, Inc. (OTCQX: TCBC) ("TCBC"), the holding company for TC Federal Bank, on July 23, 2025, jointly announced the signing of an Agreement and Plan of Merger under which the Company has agreed to acquire 100% of the common stock of TCBC in a combined stock-and-cash transaction valued at approximately $86.1 million. Upon completion of the transaction, the combined organization is expected to have approximately $3.8 billion in total assets, $2.4 billion in total loans and $3.1 billion in total deposits. The transaction is expected to be immediately accretive to the Company's earnings per share, excluding transaction costs.
Current report
The Agreement and Plan of Merger has been approved by the Boards of Directors of the Company and TCBC. The closing of the transaction, which is expected to occur in the fourth quarter of 2025, is subject to customary conditions, including regulatory approval and approval by the shareholders of the Company and TCBC.
Current report
Under the terms of the Agreement and Plan of Merger, each TCBC shareholder will have the right to elect to receive either $21.25 in cash or 1.25 shares of the Company's common stock in exchange for each share of TCBC common stock, subject to customary proration and allocation procedures such that approximately 20% of TCBC common stock will be converted to cash consideration and the remaining 80% of TCBC common stock will be converted to Company common stock.
Current report
Taxable-equivalent adjustments totaling $207,000 and $242,000 for the six months ended June 30, 2025 and 2024, respectively, are calculated using the statutory federal tax rate and are included in tax-exempt interest on investment securities.
Current report
Noninterest expense increased for the three and six months ended June 30, 2025 compared to the same period in 2024.
Current report
Other noninterest expense. Other noninterest expense increased for the three and six months ended June 30, 2025 as compared to the same periods ended June 30, 2024. These increases relate primarily to an increase in the valuation of the SBSL servicing asset.
Current report
Total assets remained stable at $3.1 billion at June 30, 2025 and December 31, 2024.
Removed paragraphs (4)
Previous report
Table 1 - Average Balance Sheet and Net Interest Analysis
Previous report
Noninterest expense decreased for the three months ended March 31, 2025 compared to the same period in 2024.
Previous report
Other noninterest expense. Other noninterest expense decreased for the three months ended March 31, 2025 as compared to the same period ended March 31, 2024. This decrease relates primarily to decreases in amortization of intangibles and FDIC assessment expenses which are partially offset by increased deposit and loan related costs.
Previous report
Total assets increased to $3.2 billion for March 31, 2025 from $3.1 billion at December 31, 2024.
Reworded paragraphs (44)
Previous wording
The purpose of this discussion and analysis is to focus on significant changes in the financial condition of Colony Bankcorp, Inc. and our wholly owned subsidiary, Colony Bank, from December 31, 2024 through March 31, 2025 and on our results of operations for the three months ended March 31, 2025 and 2024. This discussion and analysis should be read in conjunction with our audited consolidated financial statements and notes thereto in the Company's 2024 Form 10-K, and information presented elsewhere in this Quarterly Report on Form 10-Q, particularly the unaudited consolidated financial statements and related notes appearing in Item 1.
Current wording
The purpose of this discussion and analysis is to focus on significant changes in the financial condition of Colony Bankcorp, Inc. and our wholly owned subsidiary, Colony Bank, from December 31, 2024 through June 30, 2025 and on our results of operations for the three and six months ended June 30, 2025 and 2024. This discussion and analysis should be read in conjunction with our audited consolidated financial statements and notes thereto in the Company's 2024 Form 10-K, and information presented elsewhere in this Quarterly Report on Form 10-Q, particularly the unaudited consolidated financial statements and related notes appearing in Item 1.
Previous wording
This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These forward-looking statements reflect our current views with respect to, among other things, future events and our financial performance. These statements are often, but not always, made through the use of words or phrases such as “may,” “might,” “should,” “could,” “predict,” “potential,” “believe,” “expect,” “continue,” “will,” “anticipate,” “seek,” “estimate,” “intend,” “plan,” “strive,” “projection,” “goal,” “target,” “outlook,” “aim,” “would,” “annualized” and “outlook,” or the negative version of those words or other comparable words or phrases of a future or forward-looking nature. These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections about our industry, management’s beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond our control. Accordingly, we caution you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions, estimates and uncertainties that are difficult to predict. Although we believe that the expectations reflected in these forward-looking statements are reasonable as of the date made, actual results may prove to be materially different from the results expressed or implied by the forward-looking statements.
Current wording
This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These forward-looking statements reflect our current views with respect to, among other things, future events and our financial performance and statements regarding the proposed merger of TC Bancshares, Inc. ("TCBC") with the Company (the "Proposed Merger") and expectations with regard to the benefits of the Proposed Merger. These statements are often, but not always, made through the use of words or phrases such as “may,” “might,” “should,” “could,” “predict,” “potential,” “believe,” “expect,” “continue,” “will,” “anticipate,” “seek,” “estimate,” “intend,” “plan,” “strive,” “projection,” “goal,” “target,” “outlook,” “aim,” “would,” “annualized” and “outlook,” or the negative version of those words or other comparable words or phrases of a future or forward-looking nature. These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections about our industry, management’s beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond our control. Accordingly, we caution you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions, estimates and uncertainties that are difficult to predict. Although we believe that the expectations reflected in these forward-looking statements are reasonable as of the date made, actual results may prove to be materially different from the results expressed or implied by the forward-looking statements.
Previous wording
The following discussion and analysis presents the more significant factors affecting the Company’s financial condition as of March 31, 2025 and December 31, 2024, and results of operations for the three month periods ended March 31, 2025 and 2024. This discussion and analysis should be read in conjunction with the Company’s consolidated financial statements, notes thereto and other financial information appearing elsewhere in this report.
Current wording
The following discussion and analysis presents the more significant factors affecting the Company’s financial condition as of June 30, 2025 and December 31, 2024, and results of operations for the three and six month periods ended June 30, 2025 and 2024. This discussion and analysis should be read in conjunction with the Company’s consolidated financial statements, notes thereto and other financial information appearing elsewhere in this report.
Previous wording
At March 31, 2025, the Company had total consolidated assets of $3.2 billion, total loans, net of $1.9 billion, total deposits of $2.6 billion, and stockholders’ equity of $286.9 million. The Company reported net income of $6.6 million, or $0.38 per diluted share, for the three months ended March 31, 2025 compared to net income of $5.3 million, or $0.30 per diluted share, for the three months ended March 31, 2024. The increase in net income for the three months ended March 31, 2025 compared to the three months ended March 31, 2024 was primarily a result of increases in interest income, seen in the loan and deposit in banks categories, that was partially offset by decreases in interest expense and noninterest income.
Current wording
At June 30, 2025, the Company had total consolidated assets of $3.1 billion, total loans, net of $2.0 billion, total deposits of $2.6 billion, and stockholders’ equity of $293.9 million. The Company reported net income of $8.0 million, or $0.46 per diluted share, for the three months ended June 30, 2025 and $14.6 million, or $0.83 per diluted share, for the first six months of 2025 compared to net income of $5.5 million, or $0.31 per diluted share, for the three months ended June 30, 2024 and $10.8 million, or $0.62 per diluted share, for the first six months of 2024. The increase in net income for the three months ended June 30, 2025 compared to the three months ended June 30, 2024 was primarily a result of increases in interest income, seen in the loan, investment securities and deposit in banks categories along with an increase in noninterest income and slight decrease in interest expense, that was partially offset by an increase in noninterest expense. The increase in net income for the six months ended June 30, 2025 compared to the six months ended June 30, 2024 was primarily a result of increases in interest income, seen in the loan and deposit in banks categories as well as an increase in noninterest income and slight decrease in interest expense, that was partially offset by an increase in noninterest expense.
Previous wording
Net interest income on a tax equivalent basis was $21.1 million for the first quarter of 2025 compared to $18.8 million for the first quarter of 2024, an increase of $2.3 million. This increase is the result of an increase in income on interest earning assets along with a decrease in expense on interest bearing liabilities. Income on interest earning assets increased $2.2 million to $35.7 million for the first three months of 2025 compared to the respective period in 2024. Expense on interest bearing liabilities decreased $83,000 to $14.6 million for the first three months of 2025 compared to the respective period in 2024.
Current wording
Net interest income on a tax equivalent basis was $22.6 million for the second quarter of 2025 compared to $18.6 million for the second quarter of 2024, an increase of $4.0 million. Net interest income on a tax equivalent basis for the six months ended June 30, 2025 was $43.7 million, compared to $37.4 million for the six months ended June 30, 2024, an increase of $6.3 million. These increases are the result of an increase in income on interest earning assets along with a decrease in expense on interest bearing liabilities. Income on interest earning assets increased $3.5 million to $37.0 million for the second quarter of 2025 compared to the respective period in 2024. Expense on interest bearing liabilities decreased $477,000 to $14.5 million for the second quarter of 2025 compared to the respective period in 2024. Income on interest earning assets increased $5.7 million to $72.7 million for the first six months of 2025 compared to the respective period in 2024. Expense on interest bearing liabilities decreased $559,000 to $29.0 million for the first six months of 2025 compared to the respective period in 2024.
Previous wording
Provision for credit losses for the three months ended March 31, 2025 was $1.5 million which represents $1.6 million in provision for credit losses on loans and $123,000 in release of credit losses on unfunded commitments. This is compared to $1.0 million for the three months ended March 31, 2024, which represents $950,000 in provision for credit losses on loans and $50,000 in provision for credit losses on unfunded commitments. For the first quarter of 2025, there were net charge-offs of $606,000 compared to $664,000 for the same period in 2024. Colony’s allowance for credit losses on loans was $20.0 million, or 1.04% of total loans at March 31, 2025, compared to $19.0 million, or 1.03% of total loans, at December 31, 2024. At March 31, 2025 and December 31, 2024, nonperforming assets were $13.0 million and $11.3 million, or 0.41% and 0.36% of total assets, respectively.
Current wording
Provision for credit losses for the three and six months ended June 30, 2025 was $450,000 and $2.0 million, which represents $205,000 and $1.8 million in provision for credit losses on loans and $245,000 and $122,000 in provision for credit losses on unfunded commitments, respectively. This is compared to $650,000 and $1.7 million for the three and six months ended June 30, 2024, which represents $816,000 and $1.8 million in provision for credit losses on loans and $166,000 and $116,000 in release of credit losses on unfunded commitments, respectively. For the second quarter of 2025, there were net charge-offs of $1.0 million compared to $667,000 for the same period in 2024. Net charge-offs for the first six months of 2025 were $1.7 million compared to $1.3 million for the same period in 2024. Colony’s allowance for credit losses on loans was $19.2 million, or 0.96% of total loans at June 30, 2025, compared to $19.0 million, or 1.03% of total loans, at December 31, 2024. At June 30, 2025 and December 31, 2024, nonperforming assets were $11.4 million and $11.3 million, or 0.37% and 0.36% of total assets, respectively.
Previous wording
Noninterest income of $9.0 million for the first quarter of 2025 represents a decrease of $443,000, or 4.67%, from the first quarter of 2024. This decrease is a result of decreases in service charges on deposit accounts, gain on sales of SBA loans and BOLI income which were partially offset by increases in mortgage fee income and reduced losses on sales of securities. See "Table 3 - Noninterest income" for more detail and discussion on the primary drivers to the decrease in noninterest income.
Current wording
Noninterest income of $10.1 million for the second quarter of 2025 represents an increase of $601,000, or 6.33%, from the second quarter of 2024. Noninterest income of $19.1 million for the six months ended June 30, 2025 represents an increase of $158,000, or 0.83%, from the six months ended June 30, 2024. These increases are a result of increases in mortgage fee income, insurance commissions and reduced losses on sales of securities which were partially offset by decreases in service charges on deposit accounts, gain on sales of SBA loans and interchange fees. See "Table 3 - Noninterest income" for more detail and discussion on the primary drivers to the increase in noninterest income.
Previous wording
For the three months ended March 31, 2025, noninterest expense was $20.2 million, a decrease of $176,000, or 0.86%, from the same period in 2024. Decreases in noninterest expense were a result of decreases in salaries and employee benefits, professional fees and advertising and public relation expenses which were partially offset by increases in occupancy and equipment and information technology expenses. See "Table 4 - Noninterest expense" for more detail and discussion on the primary drivers to the decrease in noninterest expense.
Current wording
For the three months ended June 30, 2025, noninterest expense was $22.0 million, an increase of $1.7 million, or 8.23%, from the same period in 2024. For the six months ended June 30, 2025, noninterest expense was $42.2 million, an increase of $1.5 million, or 3.68%, from the same period in 2024. Increases in noninterest expense for both periods were a result of increases in salaries and employee benefits, occupancy and equipment and information technology expenses which were partially offset by decreases in advertising and public relation expenses and communications expense. See "Table 4 - Noninterest expense" for more detail and discussion on the primary drivers to the increase in noninterest expense.
Previous wording
The Company’s uninsured deposits represented 32.60% of total Bank deposits at March 31, 2025 compared to 33.03% of total Bank deposits at December 31, 2024. The Company continues to maintain strong liquidity with available sources of funding of approximately $1.3 billion at March 31, 2025. Furthermore, the Company’s capital remains strong with common equity Tier 1 and total capital ratios of 12.62% and 16.52%, respectively, as of March 31, 2025.
Current wording
The Company’s uninsured deposits represented 32.42% of total Bank deposits at June 30, 2025 compared to 33.03% of total Bank deposits at December 31, 2024. The Company continues to maintain strong liquidity with available sources of funding of approximately $1.3 billion at June 30, 2025. Furthermore, the Company’s capital remains strong with common equity Tier 1 and total capital ratios of 12.34% and 16.06%, respectively, as of June 30, 2025.
Previous wording
We reported net income and diluted earnings per share of $6.6 million and $0.38, respectively, for the first quarter of 2025. This compares to net income and diluted earnings per share of $5.3 million and $0.30, respectively, for the same period in 2024.
Current wording
We reported net income and diluted earnings per share of $8.0 million and $0.46, respectively, for the second quarter of 2025. This compares to net income and diluted earnings per share of $5.5 million and $0.31, respectively, for the same period in 2024. We reported net income and diluted earnings per share of $14.6 million and $0.83, respectively, for the first six months ended June 30, 2025. This compares to net income and diluted earnings per share of $10.8 million and $0.62, respectively, for the same period in 2024.
Previous wording
Fully taxable equivalent net interest income for the first quarters of 2025 and 2024 was $21.1 million and $18.8 million, respectively. This increase period over period can be seen in increases in rates on loans and deposits in banks as well as the decrease in rates paid on deposits and other borrowings. The net interest margin for the first quarter of 2025 and 2024 was 2.93% and 2.69%, respectively. The increase in the net interest margin for the first quarter of 2025 compared to the same period in 2024 is primarily a result of increases in rates on loans and deposits in banks as well as the decrease in rates paid on deposits and other borrowings.
Current wording
Fully taxable equivalent net interest income for the second quarters of 2025 and 2024 was $22.6 million and $18.6 million, respectively. This increase quarter over quarter can be seen in increases in rates and volume on loans, net and rates on taxable investment securities as well as the decrease in rates paid on deposits and other borrowings. The net interest margin for the second quarter of 2025 and 2024 was 3.12% and 2.68%, respectively. This increase in the net interest margin for the second quarter of 2025 compared to the same period in 2024 is primarily a result of increases in rates on loans, net and taxable investment securities as well as the decrease in rates paid on deposits and other borrowings. Fully taxable equivalent net interest income for the six months ended June 30, 2025 and 2024 was $43.7 million and $37.4 million, respectively. This increase period over period can be seen in increases in rates and volume on loans, net and rates on taxable investment securities as well as the decrease in rates paid on deposits and other borrowings. The net interest margin for the six months ended June 30, 2025 and 2024 was 3.02% and 2.69%, respectively. This increase in the net interest margin is primarily a result of increases in rates on loans, net and taxable investment securities as well as the decrease in rates paid on deposits and other borrowings. Loan growth for both the quarter and six month period at disciplined pricing levels contributed to the improved net interest margin compared to the prior periods.
Previous wording
The following tables indicates the relationship between interest income and interest expense and the average amounts of assets and liabilities for the periods indicated. As shown in the tables, both average assets and average liabilities increased for the three months ended March 31, 2025 compared to the same period in 2024. The increase in average assets was primarily driven by the increase in deposits in banks of $157.6 million, which was partially offset by decreases in investment securities of $39.4 million and the loan portfolio of $3.3 million. The increase in average liabilities was primarily attributed to an increase in borrowings of $28.0 million as well as an increase in interest bearing deposits of $87.7 million. The net interest spread, as well as the net interest margin, will continue to be impacted by future changes in short-term and long-term interest rate levels, as well as the impact from the competitive environment.
Current wording
The following tables indicates the relationship between interest income and interest expense and the average amounts of assets and liabilities for the periods indicated. As shown in the tables, both average assets and average liabilities increased for the three months ended June 30, 2025 compared to the same period in 2024. The increase in average assets was primarily driven by the increase in loans of $80.3 million and deposits in banks of $72.2 million, which was partially offset by decreases in investment securities of $31.2 million. The increase in average liabilities was primarily attributed to an increase in interest bearing deposits of $116.4 million as well as an increase in Federal Home Loan Bank advances of $6.5 million. For the six months ended June 30, 2025, both average assets and average liabilities increased compared to the same period in 2024. The increase in average assets was primarily driven by the increase in the loan portfolio and deposits in banks of $38.8 million and $114.6 million, respectively, partially offset by a decrease in investment securities of $35.3 million. The increase in average liabilities was attributed to an increase in interest bearing deposits and Federal Home Loan Bank advances of $102.1 million and $17.3 million, respectively. The net interest spread, as well as the net interest margin, will continue to be impacted by future changes in short-term and long-term interest rate levels, as well as the impact from the competitive environment.
Previous wording
The yield on total interest-bearing liabilities decreased from 2.58% in the first quarter of 2024 to 2.46% in the first quarter of 2025. This decrease was primarily due to decreases in the federal funds interest rate of 100 basis points during the fourth quarter of 2024 along with low cost deposit growth during the first quarter of 2025, which illustrates the Company's continued focus on its deposit first culture and building customer relationships.
Current wording
The yield on total interest-bearing liabilities decreased from 2.64% in the second quarter of 2024 to 2.42% in the second quarter of 2025. The yield on total interest-bearing liabilities decreased from 2.61% for the six months ended June 30, 2024 to 2.44% for the six months ended June 30, 2025. These decreases were primarily due to decreases in the federal funds interest rate of 100 basis points during the fourth quarter of 2024 along with low cost deposit growth during the first half of 2025, which illustrates the Company's continued focus on its deposit first culture and building customer relationships.
Previous wording
The average balance of loans includes the average balance of nonaccrual loans. Income on such loans is recognized and recorded on the cash basis. Taxable-equivalent adjustments totaling $68,000 and $48,000 for the three months ended March 31, 2025 and 2024, respectively, are calculated using the statutory federal tax rate and are included in income and fees on loans. Accretion income of $20,000 and expense of $5,000 for the three months ended March 31, 2025 and 2024, respectively, are also included in income and fees on loans.
Current wording
The average balance of loans includes the average balance of nonaccrual loans. Income on such loans is recognized and recorded on the cash basis. Taxable-equivalent adjustments totaling $102,000 and $56,000 for the three months ended June 30, 2025 and 2024, respectively, are calculated using the statutory federal tax rate and are included in income and fees on loans. Accretion income of $17,000 and $15,000 for the three months ended June 30, 2025 and 2024, respectively, are also included in income and fees on loans.
Previous wording
Taxable-equivalent adjustments totaling $104,000 and $127,000 for the three months ended March 31, 2025 and 2024, respectively, are calculated using the statutory federal tax rate and are included in tax-exempt interest on investment securities.
Current wording
Taxable-equivalent adjustments totaling $103,000 and $115,000 for the three months ended June 30, 2025 and 2024, respectively, are calculated using the statutory federal tax rate and are included in tax-exempt interest on investment securities.
Previous wording
The following table presents the effect of net interest income for changes in the average outstanding volume amounts of interest-earning assets and interest-bearing liabilities and the rates earned and paid on these assets and liabilities for the three month period ended March 31, 2025 compared to the three month period ended March 31, 2024.
Current wording
The following table presents the effect of net interest income for changes in the average outstanding volume amounts of interest-earning assets and interest-bearing liabilities and the rates earned and paid on these assets and liabilities for the three and six month periods ended June 30, 2025 compared to the three and six month periods ended June 30, 2024.
Previous wording
The provision for credit losses recorded in each period is based on the amount required such that the total allowance for credit losses reflects the appropriate balance, in the estimation of management, sufficient to cover expected credit losses over the expected life of a loan exposure and unfunded commitments where the likelihood is that funding will occur. Provision for credit losses for the three months ended March 31, 2025 was $1.5 million compared to $1.0 million for the same period in 2024. The provision for credit losses for the three months ended March 31, 2025 includes $1.6 million in credit losses on loans and $123,000 in release of credit losses on unfunded commitments. The provision for credit losses for the three months ended March 31, 2024 includes $950,000 in credit losses on loans and $50,000 in provision for credit losses on unfunded commitments. See the section captioned “Loans and Allowance for Credit Losses” elsewhere in this discussion for further analysis of the provision for credit losses.
Current wording
The provision for credit losses recorded in each period is based on the amount required such that the total allowance for credit losses reflects the appropriate balance, in the estimation of management, sufficient to cover expected credit losses over the expected life of a loan exposure and unfunded commitments where the likelihood is that funding will occur. Provision for credit losses for the three and six months ended June 30, 2025 was $450,000 and $2.0 million, respectively, compared to $650,000 and $1.7 million, respectively, for the same period in 2024. The provision for credit losses for the three and six months ended June 30, 2025 includes $205,000 and $1.8 million, respectively, in credit losses on loans and $245,000 and $122,000, respectively in credit losses on unfunded commitments. The provision for credit losses for the three and six months ended June 30, 2024 includes $816,000 and $1.8 million, respectively, in credit losses on loans and $166,000 and $116,000, respectively, in release of credit losses on unfunded commitments. See the section captioned “Loans and Allowance for Credit Losses” elsewhere in this discussion for further analysis of the provision for credit losses.
Previous wording
Noninterest income decreased for the three month period ended March 31, 2025 as compared to the same period in 2024. The decrease is primarily a result of decreases in service charges on deposit accounts, gain on sales of SBA loans and BOLI income which were partially offset by increases in mortgage fee income and reduced losses on sales of securities.
Current wording
Noninterest income increased for the three and six month periods ended June 30, 2025 as compared to the same periods in 2024. The increases in both periods is a result of increases in mortgage fee income, insurance commissions and reduced losses on sales of securities partially offset by decreases in service charges on deposit accounts, gain on sales of SBA loans and interchange fee income.
Previous wording
Service charges on deposits. For thethree months ended March 31, 2025, service charges on deposits experienced a decrease compared to the same period ended March 31, 2024. This decrease in service charges is primarily related to the impact of lower NSF fees on deposit accounts period over period.
Current wording
Service charges on deposits. For thethree and six months ended June 30, 2025, service charges on deposits experienced a decrease compared to the same periods ended June 30, 2024. These decreases in service charges are primarily a result of lower NSF fees on deposit accounts in each respective period in 2025 compared to their prior periods in 2024.
Previous wording
Mortgage Fee Income. For the three months ended March 31, 2025, mortgage fee income increased as compared to the same period ended March 31, 2024. The increase in mortgage fee income was the result of higher mortgage production period over period.
Current wording
Mortgage Fee Income. For the three and six months ended June 30, 2025, mortgage fee income increased compared to the same periods ended June 30, 2024. These increases in mortgage fee income were the result of higher mortgage production in each respective period in 2025 compared to their prior periods in 2024.
Previous wording
Gain on sales of SBA loans. For the three months ended March 31, 2025, net realized gains on the sale of the guaranteed portion of SBA loans decreased as compared to the same period ended March 31, 2024. This decrease is related to decreased production and sales in 2025 in the Small Business Specialty Lending division, which hit its highest mark during the first quarter of 2024.
Current wording
Gain on sales of SBA loans. For the three and six months ended June 30, 2025, net realized gains on the sale of the guaranteed portion of SBA loans decreased as compared to the same periods ended June 30, 2024. These decreases are related to decreased production and sales in 2025 in the Small Business Specialty Lending division.
Previous wording
BOLI income. For thethree months ended March 31, 2025, BOLI income was lower when compared to the same period ended March 31, 2024. This decrease is primarily related to reduced income due to the payout of death benefits during the first quarter of 2024.
Current wording
BOLI income. For the three months ended June 30, 2025, BOLI income was slightly higher when compared to the same period ended June 30, 2024 due to normal fluctuations in cash surrender value. For the six months ended June 30, 2025 compared to the same period in 2024, BOLI income decreased due to the payout of death benefits during the first quarter of 2024.
Previous wording
Interchange fees. For thethree months ended March 31, 2025, interchange fee income was slightly lower than the same period ended March 31, 2024. This minimal decrease in interchange fees is the result of customer use of our card programs whose buying habits can fluctuate between periods.
Current wording
Interchange fees. For thethree and six months ended June 30, 2025, interchange fee income was slightly lower than the same periods ended June 30, 2024. This minimal decrease in interchange fees is the result of customer use of our card programs whose buying habits can fluctuate between periods.
Previous wording
Insurance commissions. For thethree months ended March 31, 2025, insurance commissions increased slightly compared to the same period ended March 31, 2024. This variance is volume driven by activity in the Company's insurance division.
Current wording
Insurance commissions. For thethree and six months ended June 30, 2025, insurance commissions increased compared to the same periods ended June 30, 2024. This variance is volume driven by activity in the Company's insurance division and was also impacted by the acquisition of the Ellerbee Insurance Agency in the second quarter of 2025.
Previous wording
Other noninterest income. For thethree months ended March 31, 2025, other noninterest income increased ascompared tothe same period ended March 31, 2024. The increase in other noninterest income for the three month period ended March 31, 2025 was primarily attributable to increases in wealth advisory and merchant services, SBA servicing and other related fee income and an increase in equity investment market valuation gains, offset by a decrease in gains on sales of other real estate.
Current wording
Other noninterest income. For thethree and six months ended June 30, 2025, other noninterest income increased ascompared tothe same periods ended June 30, 2024. The increase in other noninterest income for both periods ended June 30, 2025 was primarily attributable to increases in wealth advisory and merchant services, an increase due to the writedown of bank premises in the second quarter of 2024, and an increase in equity investment market valuation gains, offset by a decrease in gains on sales of other real estate.
Previous wording
Salaries and employee benefits. Salaries and employee benefits for the three months ended March 31, 2025 decreased as compared to the same period ended March 31, 2024. The decrease in salaries and employee benefits expense is related to an increase in FAS91-deferred costs due to growth in loans as well as a decrease in total number of employees period over period.
Current wording
Salaries and employee benefits. Salaries and employee benefits for the three and six months ended June 30, 2025 increased as compared to the same periods ended June 30, 2024. These increases in salaries and employee benefits expense were primarily due to the acquisition of the Ellerbee Insurance Agency on April 1, 2025 which were partially offset by a decrease in stock award expense and an increase in FAS91-deferred costs due to growth in loans.
Previous wording
Occupancy and equipment. Occupancy and equipment expenses increased for the three months ended March 31, 2025 compared to the same period ended March 31, 2024. This increase relates primarily to increases in repair and maintenance, real estate taxes and lease expenses.
Current wording
Occupancy and equipment. Occupancy and equipment expenses increased for the three and six months ended June 30, 2025 compared to the same periods ended June 30, 2024. These increases relate primarily to increases in repair and maintenance, real estate taxes and lease expenses.
Previous wording
Information technology expenses. Information technology expenses increased for the three months ended March 31, 2025 compared to the same period ended March 31, 2024. This increase relates primarily to an increase in software expenses.
Current wording
Information technology expenses. Information technology expenses increased for the three and six months ended June 30, 2025 compared to the same periods ended June 30, 2024. These increases relate primarily to increases in software expenses which are partially offset by decreases in data processing expenses.
Previous wording
Professional fees. Professional fees decreased for the three months ended March 31, 2025 compared to the same period ended March 31, 2024. This decrease is the result of decreased legal fees partially offset by increased audit and consulting fees.
Current wording
Professional fees. Professional fees increased and decreased for the three and six months ended June 30, 2025, respectively, compared to the same periods ended June 30, 2024. The increase for the three month comparison is related to increases in consulting fees partially offset by legal fees. The decrease for the six month comparison is the result of decreased legal fees partially offset by increased consulting fees.
Previous wording
Advertising and public relations. Advertising and public relations expenses decreased for the three months ended March 31, 2025 compared to the same period ended March 31, 2024. This decrease related primarily to the timing of donations during the first quarter of 2024 compared to first quarter of 2025 related to the Georgia Scholarship Program.
Current wording
Advertising and public relations. Advertising and public relations expenses decreased for the three and six months ended June 30, 2025 compared to the same periods ended June 30, 2024. These decreases related primarily to the timing of donations during the first quarter of 2024 compared to first quarter of 2025 related to the Georgia Scholarship Program along with a decrease in appraisal fees.
Previous wording
Communications. Communications expense decreased for the three months ended March 31, 2025 compared to the same period ended March 31, 2024. The change is related to fluctuations in data circuit fees.
Current wording
Communications. Communications expense decreased for the three and six months ended June 30, 2025 compared to the same periods ended June 30, 2024. The change is related to fluctuations in data circuit fees.
Previous wording
Income tax expense for the three months ended March 31, 2025 was $1.7 million compared to $1.4 million for the same period in 2024. The Company’s effective tax rate for the three months ended March 31, 2025 was 20.1% compared to 20.9% for the three months ended March 31, 2024. The largest driver of the difference is the tax-exempt income primarily from BOLI and tax exempt interest. Also, in the first quarter of 2024, the Company experienced a favorable tax impact from the donation made to the Georgia Scholarship Program.
Current wording
Income tax expense for the three and six months ended June 30, 2025 was $2.1 million and $3.7 million, respectively, compared to $1.5 million and $2.9 million, respectively, for the same periods in 2024. The Company’s effective tax rate for the three and six months ended June 30, 2025 was 20.5% and 20.3%, respectively, compared to 21.0% and 20.9%, respectively, for the three and six months ended June 30, 2024. The largest driver of the difference is the tax-exempt income primarily from BOLI and tax exempt interest.
Previous wording
At March 31, 2025, gross loans outstanding (excluding loans held for sale) were $1.92 billion, an increase of $78.3 million, or 4.25%, compared to $1.84 billion at December 31, 2024.
Current wording
At June 30, 2025, gross loans outstanding (excluding loans held for sale) were $1.99 billion, an increase of $150.6 million, or 8.17%, compared to $1.84 billion at December 31, 2024.
Previous wording
At March 31, 2025, approximately 65.7% of our loans were secured by commercial real estate. Our total commercial real estate loans have increased since December 31, 2024 as well as our residential real estate and consumer lending, while commercial, financial & agricultural saw a slight decrease. We continue to maintain competitive loan pricing and tightened credit standards, reflected by our loan growth in the first quarter of 2025 performing better than anticipated, and sets a solid foundation for performance going forward.
Current wording
At June 30, 2025, approximately 65.1% of our loans were secured by commercial real estate. Our total commercial real estate loans have increased since December 31, 2024 as well as our residential real estate and consumer lending, while commercial, financial & agricultural saw a slight decrease. We continue to maintain loan growth at disciplined pricing levels which has contributed to an improved net interest margin.
Previous wording
The allowance for credit losses on loans was $20.0 million at March 31, 2025 compared to $18.7 million at March 31, 2024, an increase of $1.3 million, or 7.2%. The allowance for credit losses on loans as a percentage of loans was 1.04% and 1.00% at March 31, 2025 and 2024, respectively. The provision for credit losses was $1.5 million compared to $1.0 million for the three months ended March 31, 2025 and March 31, 2024, respectively. The provision for credit losses for the quarter ended March 31, 2025 includes $1.6 million in credit losses on loans and a release of $123,000 in credit losses on unfunded commitments. The provision for credit losses for the quarter ended March 31, 2024 includes $1.0 million in credit losses on loans and a provision of $50,000 in credit losses on unfunded commitments. The amount of provision expense recorded in each period was the amount required such that the total allowance for credit losses reflected the appropriate balance, in the estimation of management, that was sufficient to cover expected credit losses on loans over the expected life of a loan exposure and unfunded commitments where the likelihood is that funding will occur.
Current wording
The allowance for credit losses on loans was $19.2 million at June 30, 2025 compared to $18.8 million at June 30, 2024, an increase of $347,000, or 1.8%. The allowance for credit losses on loans as a percentage of loans was 0.96% and 1.01% at June 30, 2025 and 2024, respectively. The provision for credit losses was $450,000 compared to $650,000 for the three months ended June 30, 2025 and June 30, 2024, respectively. The provision for credit losses for the quarter ended June 30, 2025 includes $205,000 in credit losses on loans and $245,000 in credit losses on unfunded commitments. The provision for credit losses for the quarter ended June 30, 2024 includes $816,000 in credit losses on loans and a release of $166,000 in credit losses on unfunded commitments. The provision for credit losses was $1.95 million compared to $1.65 million for the six months ended June 30, 2025 and 2024, respectively. The provision for credit losses for the six months ended June 30, 2025 includes $1.83 million in credit losses on loans and $122,000 in credit losses on unfunded commitments. The provision for credit losses for the six months ended June 30, 2024 includes $1.77 million in credit losses on loans and a release of $116,000 in credit losses on unfunded commitments. The amount of provision expense recorded in each period was the amount required such that the total allowance for credit losses reflected the appropriate balance, in the estimation of management, that was sufficient to cover expected credit losses on loans over the expected life of a loan exposure and unfunded commitments where the likelihood is that funding will occur.
Previous wording
The following table presents an analysis of the allowance for credit losses on loans as of and for the three months ended March 31, 2025 and 2024:
Current wording
The following table presents an analysis of the allowance for credit losses on loans as of and for the six months ended June 30, 2025 and 2024:
Previous wording
The following table presents a summary of allowance for credit loss for the three months ended March 31, 2025 and 2024.
Current wording
The following table presents a summary of allowance for credit loss for the three and six months ended June 30, 2025 and 2024.
Previous wording
Asset quality experienced an increase during the first three months of 2025. Nonperforming assets include nonaccrual loans, accruing loans contractually past due 90 days or more, repossessed personal property and other real estate owned ("OREO"). Nonaccrual loans totaled $12.5 million at March 31, 2025, an increase of $1.8 million, or 16.8%, from $10.7 million at December 31, 2024. There were four loans contractually past due 90 days or more and still accruing totaling $22,000 at March 31, 2025 compared to six loans totaling $152,000 at December 31, 2024. There was $6,000 in repossessed personal property at March 31, 2025 and $328,000 at December 31, 2024. OREO totaled $522,000 at March 31, 2025 compared to $202,000 at December 31, 2024, which represents the addition of one property totaling $320,000. As of March 31, 2025, total nonperforming assets as a percent of total assets increased to 0.41% compared with 0.36% at December 31, 2024. The increase in nonperforming assets was primarily the result of increases in all loan segments except consumer loans partially offset by repayments, payoffs and charged off loans.
Current wording
Asset quality experienced a slight increase during the first six months of 2025. Nonperforming assets include nonaccrual loans, accruing loans contractually past due 90 days or more, repossessed personal property and other real estate owned ("OREO"). Nonaccrual loans totaled $10.6 million at June 30, 2025, a decrease of $76,000, or 0.7%, from $10.7 million at December 31, 2024. There were eight loans contractually past due 90 days or more and still accruing totaling $107,000 at June 30, 2025 compared to six loans totaling $152,000 at December 31, 2024. There was $21,000 in repossessed personal property at June 30, 2025 and $328,000 at December 31, 2024. OREO totaled $710,000 at June 30, 2025 compared to $202,000 at December 31, 2024, which represents the addition of two properties totaling $820,000 and the sale of one of those which totaled $320,000.. As of June 30, 2025, total nonperforming assets as a percent of total assets increased to 0.37% compared with 0.36% at December 31, 2024. The increase in nonperforming assets was primarily the result of increases in all loan segments except consumer loans partially offset by repayments, payoffs and charged off loans.
Previous wording
The Company had ten loans modified due to financial difficulty as of March 31, 2025. See Note 3 - Loans, included elsewhere in this Quarterly Report on Form 10-Q for additional details on loan modifications.
Current wording
The Company had no loans modified due to financial difficulty during the three or six month periods ended June 30, 2025. See Note 3 - Loans, included elsewhere in this Quarterly Report on Form 10-Q for additional details on loan modifications.
Previous wording
Total deposits increased $54.6 million to $2.62 billion at March 31, 2025 from $2.57 billion at December 31, 2024. As of March 31, 2025, 17.2% of total deposits were comprised of noninterest-bearing accounts and 82.8% were comprised of interest-bearing deposit accounts, compared to 18.0% and 82.0% as of December 31, 2024, respectively. The overall increase in our deposits was primarily due to the Company's ability to continue to attract interest-bearing deposits despite the challenging interest rate environment, and the decrease in noninterest-bearing deposits due to customer cash flow needs.
Current wording
Total deposits decreased $11.7 million to $2.56 billion at June 30, 2025 from $2.57 billion at December 31, 2024. As of June 30, 2025, 17.0% of total deposits were comprised of noninterest-bearing accounts and 83.0% were comprised of interest-bearing deposit accounts, compared to 18.0% and 82.0% as of December 31, 2024, respectively. The overall decrease in our deposits was primarily due to seasonality in customer deposit balances that is normal for this time of year.
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Current report — wording carried from elsewhere
The average balance of loans includes the average balance of nonaccrual loans. Income on such loans is recognized and recorded on the cash basis. Taxable-equivalent adjustments totaling $170,000 and $103,000 for the six months ended June 30, 2025 and 2024, respectively, are calculated using the statutory federal tax rate and are included in income and fees on loans. Accretion income of $36,000 and $10,000 for the six months ended June 30, 2025 and 2024, respectively, are also included in income and fees on loans.