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Capital City Bank Group, Inc. Reports Third Quarter 2024 Results
Источник: Nasdaq GlobeNewswire / 22 окт 2024 06:00:01 America/Chicago
TALLAHASSEE, Fla., Oct. 22, 2024 (GLOBE NEWSWIRE) -- Capital City Bank Group, Inc. (NASDAQ: CCBG) today reported net income attributable to common shareowners of $13.1 million, or $0.78 per diluted share, for the third quarter of 2024 compared to $14.2 million, or $0.83 per diluted share, for the second quarter of 2024, and $12.7 million, or $0.74 per diluted share, for the third quarter of 2023.
QUARTER HIGHLIGHTS (3rd Quarter 2024 versus 2nd Quarter 2024)
Income Statement
- Tax-equivalent net interest income totaled $40.3 million compared to $39.3 million for the prior quarter
- Net interest margin increased 10 basis points to 4.12% (earning asset yield up 7 basis points and total deposit cost down 3 basis points to 92 basis points)
- Stable credit quality metrics and credit loss provision - net loan charge-offs were 19 basis points (annualized) of average loans – allowance coverage ratio increased to 1.11% at September 30, 2024
- Noninterest income remained stable, decreasing $0.1 million, or 0.5%, and reflected a $0.4 million decline in mortgage banking revenues partially offset by a $0.3 million increase in wealth management fees
- Noninterest expense increased $2.5 million, or 6.1%, due to increases in compensation (annual merit and health care) and other expenses (professional and processing). Other expense also included a $0.5 million expense related to a counterparty payment for our VISA Class B share swap
Balance Sheet
- Loan balances decreased $33.2 million, or 1.2% (average), and declined $7.1 million, or 0.3% (end of period)
- Deposit balances decreased by $69.0 million, or 1.9% (average), and decreased $29.5 million, or 0.8% (end of period), reflecting the seasonal decline in our public fund balances
- Tangible book value per diluted share (non-GAAP financial measure) increased $0.91, or 4.2%
Commenting on the company's results, William G. Smith, Jr., Capital City Bank Group Chairman, President, and CEO, said, "I am pleased with what we accomplished in the quarter to enhance shareowner value – 4.2% growth in tangible book value per share and a 9.5% increase in the dividend. Earnings for the quarter remained stable driven by margin expansion, stable credit, and core deposit growth. Looking ahead, I remain optimistic about our full year financial performance and beyond, driven by our balance sheet flexibility, revenue diversification, and focus on continuous improvement.”
Discussion of Operating Results
Net Interest Income/Net Interest Margin
Tax-equivalent net interest income for the third quarter of 2024 totaled $40.2 million, compared to $39.3 million for the second quarter of 2024, and $39.3 million for the third quarter of 2023. Compared to the second quarter of 2024, the increase was primarily due to increases in loan and investment interest income and a decrease in deposit interest expense, partially offset by a decrease in overnight funds interest income. One additional calendar day also contributed to the increase. Favorable repricing of existing adjustable/fixed rate loans at higher rates drove the increase in loan interest income. The increase in investment interest income was due to the reinvestment of maturing securities at higher rates. The decrease in deposit interest expense was attributable to lower average NOW account balances and average rate, in addition to lower rates on promotional deposit products.
Compared to the third quarter of 2023, the $0.9 million increase was primarily driven by an increase in loan interest income and to a lesser extent overnight funds interest income, partially offset by an increase in deposit interest expense. For the first nine months of 2024, tax-equivalent net interest income totaled $118.0 million compared to $120.1 million for the same period of 2023 with the decrease primarily attributable to an increase in deposit interest expense and a decrease in investment interest income, partially offset by an increase in loan interest income.
Our net interest margin for the third quarter of 2024 was 4.12%, an increase of 10 basis points over the second quarter of 2024 and an increase of nine basis points over the third quarter of 2023. For the month of September 2024, our net interest margin was 4.16%. For the first nine months of 2024, our net interest margin was 4.05% compared to 4.04% for the same period of 2023. The increase over the second quarter of 2024 reflected favorable loan and investment repricing, partially offset by a lower overnight funds rate. The increase over both prior year periods reflected higher loan rates partially offset by a higher cost of deposits. For the third quarter of 2024, our cost of funds was 93 basis points, a decrease of four basis points from the second quarter of 2024 and an increase of 27 basis points over the third quarter of 2023. Our cost of deposits (including noninterest bearing accounts) was 92 basis points, 95 basis points, and 58 basis points, respectively, for the same periods.
Provision for Credit Losses
We recorded a provision expense for credit losses of $1.2 million for the third quarter of 2024, comparable to the second quarter of 2024 and a $1.2 million decrease from the third quarter of 2023. The provision expense for the third quarter of 2024 reflected a $0.7 million increase in the provision for loans held for investment (“HFI”), a $0.6 million provision benefit for unfunded loan commitments, and a $0.1 million provision benefit for debt securities. The increase in the provision for loans HFI was primarily due to loan grade migration and slightly higher loss rates partially offset by lower loan balances. A lower level of commitments drove the provision benefit for unfunded loan commitments. For the first nine months of 2024, we recorded a provision expense for credit losses of $3.3 million compared to $7.7 million for the same period of 2023 with the decrease driven primarily by lower new loan volume in 2024. We discuss the allowance for credit losses further below.
Noninterest Income and Noninterest Expense
Noninterest income for the third quarter of 2024 totaled $19.5 million compared to $19.6 million for the second quarter of 2024 and $16.7 million for the third quarter of 2023. The slight decrease from the second quarter of 2024 reflected a $0.4 million decrease in mortgage banking revenues partially offset by a $0.3 million increase in wealth management fees. Compared to the third quarter of 2023, the $2.8 million increase was primarily attributable to a $2.1 million increase in mortgage banking revenues driven by a higher gain on sale margin, and a $0.8 million increase in wealth management fees.
For the first nine months of 2024, noninterest income totaled $57.2 million compared to $54.5 million for the same period of 2023, primarily attributable to a $3.2 million increase in mortgage banking revenues and a $1.8 million increase in wealth management fees, partially offset by a $2.1 million decrease in other income. The increase in mortgage banking revenues was due to a higher gain on sale margin. The increase in wealth management fees was primarily driven by higher retail brokerage fees and to a lesser extent trust fees, primarily attributable to both new account growth and higher account values driven by higher market returns. The decrease in other income was primarily attributable to a $1.4 million gain from the sale of mortgage servicing rights in the second quarter of 2023, and to a lesser extent a decrease in vendor bonus income and miscellaneous income.
Noninterest expense for the third quarter of 2024 totaled $42.9 million compared to $40.4 million for the second quarter of 2024 and $39.1 million for the third quarter of 2023. The $2.5 million increase over the second quarter of 2024 was primarily due to a $1.4 million increase in compensation and a $1.0 million increase in other expense. The increase in compensation reflected higher salary expense of $0.9 million and associate benefit expense of $0.5 million. The increase in salary expense was driven by annual merit adjustments, and the increase in other associate benefit expense was primarily attributable to higher health insurance cost, and to a lesser extent higher stock-based compensation expense. The increase in other expense was primarily due to a $0.5 million increase in professional fees, processing fees of $0.3 million, and higher miscellaneous expense which included a $0.5 million payment to the counterparty for our VISA Class B share swap due to revision to the share conversion rate related to additional funding by VISA of the merchant litigation reserve. Compared to the third quarter of 2023, the $3.8 million increase was primarily attributable to a $2.8 million increase in compensation expense and a $0.9 million increase in other expense. The unfavorable variance in compensation expense reflected higher salary expense of $2.2 million and associate benefit expense of $0.6 million, with the salary variance driven by merit adjustments and the associate benefit expense variance reflective of higher health insurance cost. Further, salary expense was unfavorably impacted by lower realized loan cost (credit offset to salary expense) of $1.0 million which reflected lower loan volume in 2024. The increase in other expense was attributable to a $0.6 million increase in professional fees and higher miscellaneous expense due to the aforementioned $0.5 million share swap payment in the third quarter of 2024.
For the first nine months of 2024, noninterest expense totaled $123.5 million compared to $117.1 million for the same period of 2023 with the $6.4 million increase primarily attributable to increases in compensation expense of $4.6 million, occupancy expense of $0.5 million, and other expense of $1.3 million. The increase in compensation expense reflected a $3.9 million increase in salary expense and a $0.7 million increase in associate benefit expense. The increase in salary expense was primarily due to a lower level of realized loan cost (credit offset to salary expense) of $2.9 million (lower new loan volume) and higher base salary expense of $1.9 million (primarily annual merit raises), partially offset by lower commission expense of $1.3 million (lower residential mortgage volume). The increase in occupancy was primarily attributable to an increase in maintenance agreement expense (security upgrades and addition of interactive teller machines). The increase in other expense reflected a $1.8 million gain from the sale of a banking office in the first quarter of 2023 and higher miscellaneous expense due to the aforementioned $0.5 million share swap payment in 2024, that was partially offset by lower pension plan expense (service cost) of $1.0 million.
Income Taxes
We realized income tax expense of $3.0 million (effective rate of 19.1%) for the third quarter of 2024 compared to $3.2 million (effective rate of 18.5%) for the second quarter of 2024 and $3.0 million (effective rate of 20.7%) for the third quarter of 2023. For the first nine months of 2024, we realized income tax expense of $9.7 million (effective rate of 20.1%) compared to $10.1 million (effective rate of 20.5%) for the same period of 2023. The decrease in our effective tax rate from both prior year periods was primarily due to a higher level of tax benefit accrued from investments in solar tax credit equity funds. Absent discrete items, we expect our annual effective tax rate to approximate 20-21% for 2024.
Discussion of Financial Condition
Earning Assets
Average earning assets totaled $3.883 billion for the third quarter of 2024, a decrease of $51.9 million, or 1.3%, from the second quarter of 2024, and an increase of $59.4 million, or 1.6%, over the fourth quarter of 2023. The change for both prior periods was driven by variances in deposit balances (see below – Deposits). Compared to the second quarter of 2024, the change in the earning asset mix reflected a $33.2 million decrease in loans HFI, a $11.4 million decline in investment securities, and a $5.6 million decrease increase in overnight funds sold. Compared to the fourth quarter of 2023, the change in the earning asset mix reflected a $157.1 million increase in overnight funds that was partially offset by a $17.7 million decrease in loans HFI, a $54.7 million decrease in investment securities and a $25.2 million decline in loans held for sale.
Average loans HFI decreased $33.2 million, or 1.2%, from the second quarter of 2024 and decreased $17.7 million, or 0.7%, from the fourth quarter of 2023. Compared to the second quarter of 2024, the decrease was driven by a $19.4 million decrease in consumer loans (primarily indirect auto), commercial loans of $13.2 million, and commercial real estate loans of $7.7 million, partially offset by a $7.4 million increase in residential real estate loans. Compared to the fourth quarter of 2023, the decrease was primarily attributable to a $54.5 million decrease in consumer loans (primarily indirect auto) and commercial loans of $24.2 million (primarily tax-exempt loans) that was partially offset by a $59.2 million increase in residential real estate loans.
Period end loans HFI decreased $7.1 million, or 0.3%, from the second quarter of 2024 and decreased $50.8 million, or 1.9%, from the fourth quarter of 2023. Compared to the second quarter of 2024, the decline reflected a $20.9 million decrease in consumer loans (primarily indirect auto), a $10.4 million decrease in commercial loans, and a $3.2 million decline in commercial real estate loans, partially offset by a $10.9 million increase in residential real estate loans and a $18.1 million increase in construction loans. The decrease from the fourth quarter of 2023 was primarily attributable to a $57.7 million decrease in consumer loans (primarily indirect auto), a $30.6 million decline in commercial loans, and a $5.5 million decrease in commercial real estate loans, partially offset by a $22.2 million increase in residential real estate loans and a $22.8 million increase in construction real estate loans.
Allowance for Credit Losses
At September 30, 2024, the allowance for credit losses for loans HFI totaled $29.8 million compared to $29.2 million at June 30, 2024 and $29.9 million at December 31, 2023. Activity within the allowance is provided on Page 9. The increase in the allowance over June 30, 2024 was primarily attributable to slightly higher forecasted unemployment rate utilized in calculating loan loss rates and loan grade migration (see above – Provision for Credit Losses). Net loan charge-offs were 19 basis points of average loans for the third quarter of 2024 versus 18 basis points for the second quarter of 2024. At September 30, 2024, the allowance represented 1.11% of loans HFI compared to 1.09% at June 30, 2024, and 1.10% at December 31, 2023.
Credit Quality
Nonperforming assets (nonaccrual loans and other real estate) totaled $7.2 million at September 30, 2024 compared to $6.2 million at June 30, 2024 and $6.2 million at December 31, 2023. At September 30, 2024, nonperforming assets as a percent of total assets equaled 0.17%, compared to 0.15% at June 30, 2024 and 0.15% at December 31, 2023. Nonaccrual loans totaled $6.6 million at September 30, 2024, a $1.1 million increase over June 30, 2024 and a $0.3 million increase over December 31, 2023. Further, classified loans totaled $25.5 million at September 30, 2024, a $0.1 million decrease from June 30, 2024 and a $3.3 million increase over December 31, 2023.
Deposits
Average total deposits were $3.572 billion for the third quarter of 2024, a decrease of $69.0 million, or 1.9%, from the second quarter of 2024 and an increase of $23.5 million, or 0.7%, over the fourth quarter of 2023. Compared to the second quarter of 2024, the decrease was primarily attributable to lower NOW account balances primarily due to the seasonal decline in our public fund balances. The increase over the fourth quarter of 2023 reflected growth in both money market and certificate of deposit balances which reflected a combination of balances migrating from savings and noninterest bearing accounts, in addition to receiving new deposits from existing and new clients via various deposit strategies.
At September 30, 2024, total deposits were $3.579 billion, a decrease of $29.5 million, or 0.8%, from June 30, 2024, and a decrease of $122.7 million, or 3.3%, from December 31, 2023. The decrease from June 30, 2024 was primarily due to lower noninterest bearing, money market, and savings account balances. The decrease from December 31, 2023 was primarily due to lower NOW account balances, primarily due to the seasonal decline in our public funds, partially offset by higher money market and certificate of deposit balances from both new and existing clients. Total public funds balances were $516.2 million at September 30, 2024, $575.0 million at June 30, 2024, and $709.8 million at December 31, 2023.
Liquidity
The Bank maintained an average net overnight funds (i.e., deposits with banks plus FED funds sold less FED funds purchased) sold position of $256.9 million in the third quarter of 2024 compared to $262.4 million in the second quarter of 2024 and $99.8 million in the fourth quarter of 2023. Compared to the second quarter of 2024, the decrease reflected lower average deposits (primarily seasonal public funds) that was substantially offset by a decline in average loans. Compared to the fourth quarter of 2023, the increase was primarily driven by higher average deposits and lower average investments.
At September 30, 2024, we had the ability to generate approximately $1.522 billion (excludes overnight funds position of $262 million) in additional liquidity through various sources including various federal funds purchased lines, Federal Home Loan Bank borrowings, the Federal Reserve Discount Window, and brokered deposits.
We also view our investment portfolio as a liquidity source as we have the option to pledge securities in our portfolio as collateral for borrowings or deposits, and/or to sell selected securities in our portfolio. Our portfolio consists of debt issued by the U.S. Treasury, U.S. governmental agencies, municipal governments, and corporate entities. At September 30, 2024, the weighted-average maturity and duration of our portfolio were 2.51 years and 2.17 years, respectively, and the available-for-sale portfolio had a net unrealized after-tax loss of $15.5 million.
Capital
Shareowners’ equity was $476.5 million at September 30, 2024 compared to $461.0 million at June 30, 2024 and $440.6 million at December 31, 2023. For the first nine months of 2024, shareowners’ equity was positively impacted by net income attributable to shareowners of $39.8 million, a $8.7 million decrease in the net unrealized loss on available for sale securities, net adjustments totaling $0.9 million related to transactions under our stock compensation plans, and stock compensation accretion of $1.1 million. Shareowners’ equity was reduced by a common stock dividend of $11.0 million ($0.65 per share), the repurchase of common stock of $2.3 million (82,540 shares), a $0.6 million increase in the fair value of the interest rate swap related to subordinated debt, and a $0.7 million reclassification to temporary equity.
At September 30, 2024, our total risk-based capital ratio was 17.97% compared to 17.50% at June 30, 2024 and 16.57% at December 31, 2023. Our common equity tier 1 capital ratio was 14.88%, 14.44%, and 13.52%, respectively, on these dates. Our leverage ratio was 10.89%, 10.51%, and 10.30%, respectively, on these dates. At September 30, 2024, all our regulatory capital ratios exceeded the thresholds to be designated as “well-capitalized” under the Basel III capital standards. Further, our tangible common equity ratio (non-GAAP financial measure) was 9.28% at September 30, 2024 compared to 8.91% and 8.26% at June 30, 2024 and December 31, 2023, respectively. If our unrealized held-to-maturity securities losses of $12.9 million (after-tax) were recognized in accumulated other comprehensive loss, our adjusted tangible capital ratio would be 9.00%.
About Capital City Bank Group, Inc.
Capital City Bank Group, Inc. (NASDAQ: CCBG) is one of the largest publicly traded financial holding companies headquartered in Florida and has approximately $4.2 billion in assets. We provide a full range of banking services, including traditional deposit and credit services, mortgage banking, asset management, trust, merchant services, bankcards, securities brokerage services and financial advisory services, including the sale of life insurance, risk management and asset protection services. Our bank subsidiary, Capital City Bank, was founded in 1895 and now has 63 banking offices and 105 ATMs/ITMs 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 our future results to differ materially. The words “may,” “could,” “should,” “would,” “believe,” “anticipate,” “estimate,” “expect,” “intend,” “plan,” “target,” “vision,” “goal,” and similar expressions are intended to identify forward-looking statements. The following factors, among others, could cause our actual results to differ: our ability to successfully manage credit risk, interest rate risk, liquidity risk, and other risks inherent to our industry; the effects of changes in the level of checking or savings account deposits and the competition for deposits on our funding costs, net interest margin and ability to replace maturing deposits and advances; legislative or regulatory changes; adverse developments in the financial services industry; inflation, interest rate, market and monetary fluctuations; uncertainty in the pricing of residential mortgage loans that we sell, as well as competition for the mortgage servicing rights related to these loans; interest rate risk and price risk resulting from retaining mortgage servicing rights and the effects of higher interest rates on our loan origination volumes; changes in monetary and fiscal policies of the U.S. Government; the cost and effects of cybersecurity incidents or other failures, interruptions, or security breaches of our systems or those of our customers or third-party providers; the effects of fraud related to debit card products; the accuracy of our financial statement estimates and assumptions; changes in accounting principles, policies, practices or guidelines; the frequency and magnitude of foreclosure of our loans; the effects of our lack of a diversified loan portfolio; the strength of the local economies in which we operate; our ability to declare and pay dividends; structural changes in the markets for origination, sale and servicing of residential mortgages; our ability to retain key personnel; the effects of natural disasters (including hurricanes), widespread health emergencies (including pandemics), military conflict, terrorism, civil unrest or other geopolitical events; our ability to comply with the extensive laws and regulations to which we are subject; the impact of the restatement of our previously issued consolidated statements of cash flows; any deficiencies in the processes undertaken to effect these restatements and to identify and correct all errors in our historical financial statements that may require restatement; any inability to implement and maintain effective internal control over financial reporting and/or disclosure control or inability to remediate our existing material weaknesses in our internal controls deemed ineffective; the willingness of clients to accept third-party products and services rather than our products and services; technological changes; the outcomes of litigation or regulatory proceedings; negative publicity and the impact on our reputation; changes in consumer spending and saving habits; growth and profitability of our noninterest income; the limited trading activity of our common stock; the concentration of ownership of our common stock; anti-takeover provisions under federal and state law as well as our Articles of Incorporation and our Bylaws; other risks described from time to time in our filings with the Securities and Exchange Commission; and our ability to manage the risks involved in the foregoing. Additional factors can be found in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, as amended, and our other filings with the SEC, which are available at the SEC’s internet site (http://www.sec.gov). Forward-looking statements in this Press Release speak only as of the date of the Press Release, and we assume no obligation to update forward-looking statements or the reasons why actual results could differ, except as may be required by law.
USE OF NON-GAAP FINANCIAL MEASURES
UnauditedWe present a tangible common equity ratio and a tangible book value per diluted share that removes the effect of goodwill and other intangibles resulting from merger and acquisition activity. We believe these measures are useful to investors because it allows investors to more easily compare our capital adequacy to other companies in the industry.
The GAAP to non-GAAP reconciliations are provided below.
(Dollars in Thousands, except per share data) Sep 30, 2024 Jun 30, 2024 Mar 31, 2024 Dec 31, 2023 Sep 30, 2023 Shareowners' Equity (GAAP) $ 476,499 $ 460,999 $ 448,314 $ 440,625 $ 419,706 Less: Goodwill and Other Intangibles (GAAP) 92,813 92,853 92,893 92,933 92,973 Tangible Shareowners' Equity (non-GAAP) A 383,686 368,146 355,421 347,692 326,733 Total Assets (GAAP) 4,225,316 4,225,695 4,259,922 4,304,477 4,138,287 Less: Goodwill and Other Intangibles (GAAP) 92,813 92,853 92,893 92,933 92,973 Tangible Assets (non-GAAP) B $ 4,132,503 $ 4,132,842 $ 4,167,029 $ 4,211,544 $ 4,045,314 Tangible Common Equity Ratio (non-GAAP) A/B 9.28% 8.91% 8.53% 8.26% 8.08% Actual Diluted Shares Outstanding (GAAP) C 16,980,686 16,970,228 16,947,204 17,000,758 16,997,886 Tangible Book Value per Diluted Share (non-GAAP) A/C $ 22.60 $ 21.69 $ 20.97 $ 20.45 $ 19.22 CAPITAL CITY BANK GROUP, INC. EARNINGS HIGHLIGHTS Unaudited Three Months Ended Nine Months Ended (Dollars in thousands, except per share data) Sep 30, 2024 Jun 30, 2024 Sep 30, 2023 Sep 30, 2024 Sep 30, 2023 EARNINGS Net Income Attributable to Common Shareowners $ 13,118 $ 14,150 $ 12,655 $ 39,825 $ 40,539 Diluted Net Income Per Share $ 0.78 $ 0.83 $ 0.74 $ 2.35 $ 2.38 PERFORMANCE Return on Average Assets (annualized) 1.24 % 1.33 % 1.19 % 1.26 % 1.26 % Return on Average Equity (annualized) 10.87 12.23 11.74 11.39 13.00 Net Interest Margin 4.12 4.02 4.03 4.05 4.04 Noninterest Income as % of Operating Revenue 32.67 33.30 29.87 32.69 31.25 Efficiency Ratio 71.81 % 68.61 % 69.88 % 70.49 % 67.07 % CAPITAL ADEQUACY Tier 1 Capital 16.77 % 16.31 % 15.11 % 16.77 % 15.11 % Total Capital 17.97 17.50 16.30 17.97 16.30 Leverage 10.89 10.51 9.98 10.89 9.98 Common Equity Tier 1 14.88 14.44 13.26 14.88 13.26 Tangible Common Equity (1) 9.28 8.91 8.08 9.28 8.08 Equity to Assets 11.28 % 10.91 % 10.14 % 11.28 % 10.14 % ASSET QUALITY Allowance as % of Non-Performing Loans 452.64 % 529.79 % 619.58 % 452.64 % 619.58 % Allowance as a % of Loans HFI 1.11 1.09 1.08 1.11 1.08 Net Charge-Offs as % of Average Loans HFI 0.19 0.18 0.17 0.20 0.16 Nonperforming Assets as % of Loans HFI and OREO 0.27 0.23 0.17 0.27 0.17 Nonperforming Assets as % of Total Assets 0.17 % 0.15 % 0.11 % 0.17 % 0.11 % STOCK PERFORMANCE High $ 36.67 $ 28.58 $ 33.44 $ 36.67 $ 36.86 Low 26.72 25.45 28.64 25.45 28.03 Close $ 35.29 $ 28.44 $ 29.83 $ 35.29 $ 29.83 Average Daily Trading Volume 37,151 29,861 26,774 32,720 33,936 (1) Tangible common equity ratio is a non-GAAP financial measure. For additional information, including a
reconciliation to GAAP, refer to Page 6.CAPITAL CITY BANK GROUP, INC. CONSOLIDATED STATEMENT OF FINANCIAL CONDITION Unaudited 2024 2023 (Dollars in thousands) Third Quarter Second Quarter First Quarter Fourth Quarter Third Quarter ASSETS Cash and Due From Banks $ 83,431 $ 75,304 $ 73,642 $ 83,118 $ 72,379 Funds Sold and Interest Bearing Deposits 261,779 272,675 231,047 228,949 95,119 Total Cash and Cash Equivalents 345,210 347,979 304,689 312,067 167,498 Investment Securities Available for Sale 336,187 310,941 327,338 337,902 334,052 Investment Securities Held to Maturity 561,480 582,984 603,386 625,022 632,076 Other Equity Securities 6,976 2,537 3,445 3,450 3,585 Total Investment Securities 904,643 896,462 934,169 966,374 969,713 Loans Held for Sale 31,251 24,022 24,705 28,211 34,013 Loans Held for Investment ("HFI"): Commercial, Financial, & Agricultural 194,625 204,990 218,298 225,190 221,704 Real Estate - Construction 218,899 200,754 202,692 196,091 197,526 Real Estate - Commercial 819,955 823,122 823,690 825,456 828,234 Real Estate - Residential 1,023,485 1,012,541 1,012,791 1,001,257 966,512 Real Estate - Home Equity 210,988 211,126 214,617 210,920 203,606 Consumer 213,305 234,212 254,168 270,994 285,122 Other Loans 461 2,286 3,789 2,962 1,401 Overdrafts 1,378 1,192 1,127 1,048 1,076 Total Loans Held for Investment 2,683,096 2,690,223 2,731,172 2,733,918 2,705,181 Allowance for Credit Losses (29,836 ) (29,219 ) (29,329 ) (29,941 ) (29,083 ) Loans Held for Investment, Net 2,653,260 2,661,004 2,701,843 2,703,977 2,676,098 Premises and Equipment, Net 81,876 81,414 81,452 81,266 81,677 Goodwill and Other Intangibles 92,813 92,853 92,893 92,933 92,973 Other Real Estate Owned 650 650 1 1 1 Other Assets 115,613 121,311 120,170 119,648 116,314 Total Other Assets 290,952 296,228 294,516 293,848 290,965 Total Assets $ 4,225,316 $ 4,225,695 $ 4,259,922 $ 4,304,477 $ 4,138,287 LIABILITIES Deposits: Noninterest Bearing Deposits $ 1,330,715 $ 1,343,606 $ 1,361,939 $ 1,377,934 $ 1,472,165 NOW Accounts 1,174,585 1,177,180 1,212,452 1,327,420 1,092,996 Money Market Accounts 401,272 413,594 398,308 319,319 304,323 Savings Accounts 507,604 514,560 530,782 547,634 571,003 Certificates of Deposit 164,901 159,624 151,320 129,515 99,958 Total Deposits 3,579,077 3,608,564 3,654,801 3,701,822 3,540,445 Repurchase Agreements 29,339 22,463 23,477 26,957 22,910 Other Short-Term Borrowings 7,929 3,307 8,409 8,384 18,786 Subordinated Notes Payable 52,887 52,887 52,887 52,887 52,887 Other Long-Term Borrowings 794 1,009 265 315 364 Other Liabilities 71,974 69,987 65,181 66,080 75,585 Total Liabilities 3,742,000 3,758,217 3,805,020 3,856,445 3,710,977 Temporary Equity 6,817 6,479 6,588 7,407 7,604 SHAREOWNERS' EQUITY Common Stock 169 169 169 170 170 Additional Paid-In Capital 36,070 35,547 34,861 36,326 36,182 Retained Earnings 454,342 445,959 435,364 426,275 418,030 Accumulated Other Comprehensive Loss, Net of Tax (14,082 ) (20,676 ) (22,080 ) (22,146 ) (34,676 ) Total Shareowners' Equity 476,499 460,999 448,314 440,625 419,706 Total Liabilities, Temporary Equity and Shareowners' Equity $ 4,225,316 $ 4,225,695 $ 4,259,922 $ 4,304,477 $ 4,138,287 OTHER BALANCE SHEET DATA Earning Assets $ 3,880,769 $ 3,883,382 $ 3,921,093 $ 3,957,452 $ 3,804,026 Interest Bearing Liabilities 2,339,311 2,344,624 2,377,900 2,412,431 2,163,227 Book Value Per Diluted Share $ 28.06 $ 27.17 $ 26.45 $ 25.92 $ 24.69 Tangible Book Value Per Diluted Share(1) 22.60 21.69 20.97 20.45 19.22 Actual Basic Shares Outstanding 16,944 16,942 16,929 16,950 16,958 Actual Diluted Shares Outstanding 16,981 16,970 16,947 17,001 16,998 (1) Tangible book value per diluted share is a non-GAAP financial measure. For additional information, including a reconciliation to GAAP, refer to Page 6. CAPITAL CITY BANK GROUP, INC. CONSOLIDATED STATEMENT OF OPERATIONS Unaudited 2024 2023 Nine Months Ended
September 30,(Dollars in thousands, except per share data) Third
QuarterSecond
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Quarter2024 2023 INTEREST INCOME Loans, including Fees $ 41,659 $ 41,138 $ 40,683 $ 40,407 $ 39,344 $ 123,480 $ 111,845 Investment Securities 4,155 4,004 4,244 4,392 4,561 12,403 14,300 Federal Funds Sold and Interest Bearing Deposits 3,514 3,624 1,893 1,385 1,848 9,031 8,741 Total Interest Income 49,328 48,766 46,820 46,184 45,753 144,914 134,886 INTEREST EXPENSE Deposits 8,223 8,579 7,594 5,872 5,214 24,396 11,710 Repurchase Agreements 221 217 201 199 190 639 314 Other Short-Term Borrowings 52 68 39 310 440 159 1,228 Subordinated Notes Payable 610 630 628 627 625 1,868 1,800 Other Long-Term Borrowings 11 3 3 5 4 17 15 Total Interest Expense 9,117 9,497 8,465 7,013 6,473 27,079 15,067 Net Interest Income 40,211 39,269 38,355 39,171 39,280 117,835 119,819 Provision for Credit Losses 1,206 1,204 920 2,025 2,393 3,330 7,689 Net Interest Income after Provision for Credit Losses 39,005 38,065 37,435 37,146 36,887 114,505 112,130 NONINTEREST INCOME Deposit Fees 5,512 5,377 5,250 5,304 5,456 16,139 16,021 Bank Card Fees 3,624 3,766 3,620 3,713 3,684 11,010 11,205 Wealth Management Fees 4,770 4,439 4,682 4,276 3,984 13,891 12,061 Mortgage Banking Revenues 3,966 4,381 2,878 2,327 1,839 11,225 8,072 Other 1,641 1,643 1,667 1,537 1,765 4,951 7,093 Total Noninterest Income 19,513 19,606 18,097 17,157 16,728 57,216 54,452 NONINTEREST EXPENSE Compensation 25,800 24,406 24,407 23,822 23,003 74,613 69,965 Occupancy, Net 7,098 6,997 6,994 7,098 6,980 21,089 20,562 Other 10,023 9,038 8,770 9,038 9,122 27,831 26,539 Total Noninterest Expense 42,921 40,441 40,171 39,958 39,105 123,533 117,066 OPERATING PROFIT 15,597 17,230 15,361 14,345 14,510 48,188 49,516 Income Tax Expense 2,980 3,189 3,536 2,909 3,004 9,705 10,130 Net Income 12,617 14,041 11,825 11,436 11,506 38,483 39,386 Pre-Tax Loss Attributable to Noncontrolling Interest 501 109 732 284 1,149 1,342 1,153 NET INCOME ATTRIBUTABLE TO
COMMON SHAREOWNERS$ 13,118 $ 14,150 $ 12,557 $ 11,720 $ 12,655 $ 39,825 $ 40,539 PER COMMON SHARE Basic Net Income $ 0.77 $ 0.84 $ 0.74 $ 0.69 $ 0.75 $ 2.35 $ 2.38 Diluted Net Income 0.78 0.83 0.74 0.70 0.74 2.35 2.38 Cash Dividend $ 0.23 $ 0.21 $ 0.21 $ 0.20 $ 0.20 $ 0.65 $ 0.56 AVERAGE SHARES Basic 16,943 16,931 16,951 16,947 16,985 16,942 17,001 Diluted 16,979 16,960 16,969 16,997 17,025 16,966 17,031 CAPITAL CITY BANK GROUP, INC. ALLOWANCE FOR CREDIT LOSSES ("ACL") AND CREDIT QUALITY Unaudited 2024 2023 Nine Months Ended
September 30,(Dollars in thousands, except per share data) Third
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Quarter2024 2023 ACL - HELD FOR INVESTMENT LOANS Balance at Beginning of Period $ 29,219 $ 29,329 $ 29,941 $ 29,083 $ 28,243 $ 29,941 $ 25,068 Transfer from Other (Assets) Liabilities - - (50 ) 66 - (50 ) - Provision for Credit Losses 1,879 1,129 932 2,354 1,993 3,940 7,175 Net Charge-Offs (Recoveries) 1,262 1,239 1,494 1,562 1,153 3,995 3,160 Balance at End of Period $ 29,836 $ 29,219 $ 29,329 $ 29,941 $ 29,083 $ 29,836 $ 29,083 As a % of Loans HFI 1.11% 1.09% 1.07% 1.10% 1.08% 1.11% 1.08% As a % of Nonperforming Loans 452.64% 529.79% 431.46% 479.70% 619.58% 452.64% 619.58% ACL - UNFUNDED COMMITMENTS Balance at Beginning of Period 3,139 $ 3,121 $ 3,191 $ 3,502 $ 3,120 $ 3,191 $ 2,989 Provision for Credit Losses (617 ) 18 (70 ) (311 ) 382 (669 ) 513 Balance at End of Period(1) 2,522 3,139 3,121 3,191 3,502 2,522 3,502 ACL - DEBT SECURITIES Provision for Credit Losses $ (56 ) $ 57 $ 58 $ (18 ) $ 18 $ 59 $ 1 CHARGE-OFFS Commercial, Financial and Agricultural $ 331 $ 400 $ 282 $ 217 $ 76 $ 1,013 $ 294 Real Estate - Construction - - - - - - - Real Estate - Commercial 3 - - - - 3 120 Real Estate - Residential - - 17 79 - 17 - Real Estate - Home Equity 23 - 76 - - 99 39 Consumer 1,315 1,061 1,550 1,689 1,340 3,926 4,065 Overdrafts 611 571 638 602 659 1,820 2,187 Total Charge-Offs $ 2,283 $ 2,032 $ 2,563 $ 2,587 $ 2,075 $ 6,878 $ 6,705 RECOVERIES Commercial, Financial and Agricultural $ 176 $ 59 $ 41 $ 83 $ 28 $ 276 $ 194 Real Estate - Construction - - - - - - 2 Real Estate - Commercial 5 19 204 16 17 228 36 Real Estate - Residential 88 23 37 34 30 148 219 Real Estate - Home Equity 59 37 24 17 53 120 209 Consumer 405 313 410 433 418 1,128 1,503 Overdrafts 288 342 353 442 376 983 1,382 Total Recoveries $ 1,021 $ 793 $ 1,069 $ 1,025 $ 922 $ 2,883 $ 3,545 NET CHARGE-OFFS (RECOVERIES) $ 1,262 $ 1,239 $ 1,494 $ 1,562 $ 1,153 $ 3,995 $ 3,160 Net Charge-Offs as a % of Average Loans HFI(2) 0.19% 0.18% 0.22% 0.23% 0.17% 0.20% 0.16% CREDIT QUALITY Nonaccruing Loans $ 6,592 $ 5,515 $ 6,798 $ 6,242 $ 4,694 Other Real Estate Owned 650 650 1 1 1 Total Nonperforming Assets ("NPAs") $ 7,242 $ 6,165 $ 6,799 $ 6,243 $ 4,695 Past Due Loans 30-89 Days $ 9,388 $ 5,672 $ 5,392 $ 6,855 $ 5,577 Classified Loans 25,501 25,566 22,305 22,203 21,812 Nonperforming Loans as a % of Loans HFI 0.25% 0.21% 0.25% 0.23% 0.17% NPAs as a % of Loans HFI and Other Real Estate 0.27% 0.23% 0.25% 0.23% 0.17% NPAs as a % of Total Assets 0.17% 0.15% 0.16% 0.15% 0.11% (1) Recorded in other liabilities (2) Annualized CAPITAL CITY BANK GROUP, INC. AVERAGE BALANCE AND INTEREST RATES Unaudited Third Quarter 2024 Second Quarter 2024 First Quarter 2024 Fourth Quarter 2023 Third Quarter 2023 Sep 2024 YTD Sep 2023 YTD (Dollars in thousands) Average
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RateASSETS: Loans Held for Sale $ 24,570 $ 720 7.49 % $ 26,281 $ 517 5.26 % $ 27,314 $ 563 5.99 % $ 49,790 817 6.50 % $ 62,768 $ 971 6.14 % $ 26,050 $ 1,800 6.22 % $ 57,438 $ 2,416 5.62 % Loans Held for Investment(1) 2,693,533 40,985 6.09 2,726,748 40,683 6.03 2,728,629 40,196 5.95 2,711,243 39,679 5.81 2,672,653 38,455 5.71 2,716,220 121,864 6.02 2,637,911 109,688 5.56 Investment Securities Taxable Investment Securities 907,610 4,148 1.82 918,989 3,998 1.74 952,328 4,239 1.78 962,322 4,389 1.81 1,002,547 4,549 1.80 926,241 12,385 1.78 1,034,825 14,265 1.84 Tax-Exempt Investment Securities(1) 846 10 4.33 843 9 4.36 856 9 4.34 862 7 4.32 2,456 17 2.66 848 28 4.34 2,649 50 2.49 Total Investment Securities 908,456 4,158 1.82 919,832 4,007 1.74 953,184 4,248 1.78 963,184 4,396 1.82 1,005,003 4,566 1.81 927,089 12,413 1.78 1,037,474 14,315 1.84 Federal Funds Sold and Interest Bearing Deposits 256,855 3,514 5.44 262,419 3,624 5.56 140,488 1,893 5.42 99,763 1,385 5.51 136,556 1,848 5.37 220,056 9,031 5.48 237,987 8,741 4.91 Total Earning Assets 3,883,414 $ 49,377 5.06 % 3,935,280 $ 48,831 4.99 % 3,849,615 $ 46,900 4.90 % 3,823,980 $ 46,277 4.80 % 3,876,980 $ 45,840 4.69 % 3,889,415 $ 145,108 4.98 % 3,970,810 $ 135,160 4.55 % Cash and Due From Banks 70,994 74,803 75,763 76,681 75,941 73,843 75,483 Allowance for Credit Losses (29,905 ) (29,564 ) (30,030 ) (29,998 ) (29,172 ) (29,833 ) (27,581 ) Other Assets 291,359 291,669 295,275 296,114 295,106 292,762 297,688 Total Assets $ 4,215,862 $ 4,272,188 $ 4,190,623 $ 4,166,777 $ 4,218,855 $ 4,226,187 $ 4,316,400 LIABILITIES: Noninterest Bearing Deposits $ 1,332,305 $ 1,346,546 $ 1,344,188 $ 1,416,825 $ 1,474,574 $ 1,340,981 $ 1,538,268 NOW Accounts 1,145,544 $ 4,087 1.42 % 1,207,643 $ 4,425 1.47 % 1,201,032 $ 4,497 1.51 % 1,138,461 $ 3,696 1.29 % 1,125,171 $ 3,489 1.23 % 1,184,596 $ 13,009 1.47 % 1,184,453 $ 8,679 0.98 % Money Market Accounts 418,625 2,694 2.56 407,387 2,752 2.72 353,591 1,985 2.26 318,844 1,421 1.77 322,623 1,294 1.59 393,294 7,431 2.52 293,089 2,249 1.03 Savings Accounts 512,098 180 0.14 519,374 176 0.14 539,374 188 0.14 557,579 202 0.14 579,245 200 0.14 523,573 544 0.14 603,643 396 0.09 Time Deposits 163,462 1,262 3.07 160,078 1,226 3.08 138,328 924 2.69 116,797 553 1.88 95,203 231 0.96 153,991 3,412 2.96 90,970 386 0.57 Total Interest Bearing Deposits 2,239,729 8,223 1.46 2,294,482 8,579 1.50 2,232,325 7,594 1.37 2,131,681 5,872 1.09 2,122,242 5,214 0.97 2,255,454 24,396 1.44 2,172,155 11,710 0.72 Total Deposits 3,572,034 8,223 0.92 3,641,028 8,579 0.95 3,576,513 7,594 0.85 3,548,506 5,872 0.66 3,596,816 5,214 0.58 3,596,435 24,396 0.91 3,710,423 11,710 0.42 Repurchase Agreements 27,126 221 3.24 26,999 217 3.24 25,725 201 3.14 26,831 199 2.94 25,356 190 2.98 26,619 639 3.21 17,588 314 2.39 Other Short-Term Borrowings 2,673 52 7.63 6,592 68 4.16 3,758 39 4.16 16,906 310 7.29 24,306 440 7.17 4,334 159 4.88 26,586 1,228 6.17 Subordinated Notes Payable 52,887 610 4.52 52,887 630 4.71 52,887 628 4.70 52,887 627 4.64 52,887 625 4.62 52,887 1,868 4.64 52,887 1,800 4.49 Other Long-Term Borrowings 795 11 5.55 258 3 4.31 281 3 4.80 336 5 4.72 387 4 4.73 447 17 5.16 433 15 4.78 Total Interest Bearing Liabilities 2,323,210 $ 9,117 1.56 % 2,381,218 $ 9,497 1.60 % 2,314,976 $ 8,465 1.47 % 2,228,641 $ 7,013 1.25 % 2,225,178 $ 6,473 1.15 % 2,339,741 $ 27,079 1.55 % 2,269,649 $ 15,067 0.89 % Other Liabilities 73,767 72,634 68,295 78,772 83,099 71,574 82,877 Total Liabilities 3,729,282 3,800,398 3,727,459 3,724,238 3,782,851 3,752,296 3,890,794 Temporary Equity 6,443 6,493 7,150 7,423 8,424 6,694 8,719 SHAREOWNERS' EQUITY: 480,137 465,297 456,014 435,116 427,580 467,197 416,887 Total Liabilities, Temporary Equity and Shareowners' Equity $ 4,215,862 $ 4,272,188 $ 4,190,623 $ 4,166,777 $ 4,218,855 $ 4,226,187 $ 4,316,400 Interest Rate Spread $ 40,260 3.49 % $ 39,334 3.38 % $ 38,435 3.43 % $ 39,264 3.55 % $ 39,367 3.54 % $ 118,029 3.43 % $ 120,093 3.66 % Interest Income and Rate Earned(1) 49,377 5.06 48,831 4.99 46,900 4.90 46,277 4.80 45,840 4.69 145,108 4.98 135,160 4.55 Interest Expense and Rate Paid(2) 9,117 0.93 9,497 0.97 8,465 0.88 7,013 0.73 6,473 0.66 27,079 0.93 15,067 0.51 Net Interest Margin $ 40,260 4.12 % $ 39,334 4.02 % $ 38,435 4.01 % $ 39,264 4.07 % $ 39,367 4.03 % $ 118,029 4.05 % $ 120,093 4.04 % (1) Interest and average rates are calculated on a tax-equivalent basis using a 21% Federal tax rate. (2) Rate calculated based on average earning assets. For Information Contact:
Jep Larkin
Executive Vice President and Chief Financial Officer
850.402. 8450
- Tax-equivalent net interest income totaled $40.3 million compared to $39.3 million for the prior quarter