EX-99.1 2 ex99_1.htm EXHIBIT 99.1 Exhibit 99.1

Exhibit 99.1
SouthCrest Financial Group, Inc. Announces Second Quarter Earnings

FAYETTEVILLE, GA, (August 11, 2006) - SouthCrest Financial Group, Inc. (SCSG) reported net income for the quarter ended June 30, 2006 of $1,426,000 or $0.40 per share, compared to $1,358,000 or $0.38 per share for the same quarter a year ago. For the six month period ended June 30, 2006, net income was $2,832,000, or $0.79 per share compared to $2,177,000, or $0.61 per share. All per share amounts are stated on a basic and fully diluted basis.

Total assets at June 30, 2006 were $461.2 million compared to $425.3 million at June 30, 2005, an increase of $35.9 million, or 8.4%. Over the same twelve month period, gross loans (excluding reserves for loan losses) increased 16.2% to $287.5 million while deposits grew 6.7% to $389.2 million.

Return on average assets for the current quarter was 1.26% and was 1.27% for the year to date period ended June 30, 2006.

At June 30, 2006, the allowance for loan losses was 1.31 % of loans compared to 1.26% at December 31, 2005. For the six months ended June 30, 2006, the Company experienced net recoveries of 0.03% compared to net chargeoffs of 0.16% for the same period in 2005. Nonperforming assets increased to $1,526,000 from $1,111,000 at December 31, 2005. Despite the increase in nonperforming assets, the Company’s asset quality indicators compare favorably with historical benchmarks for the industry. At June 30, 2006, nonperforming assets were 0.33% of total assets compared to 0.25% of total assets at December 31, 2005.

In a press release dated July 3, 2006, the Company announced that it declared a dividend of $0.125 per share compared to $0.12 per share for the same period a year ago. The dividend was paid on July 31, 2006 to shareholders of record as of July 17, 2006.

About SouthCrest Financial Group, Inc.

SouthCrest Financial Group, Inc. is the parent company of two bank subsidiaries operating a total of nine branch offices. Bank of Upson, based in Thomaston, Georgia, has two branches in Upson County, three branches in Meriwether County operating as Meriwether Bank & Trust, and one branch in Fayette County operating as SouthCrest Bank. First National Bank of Polk County, based in Cedartown, Georgia, operates three branches in Polk County. SouthCrest is traded on the OTC-Bulletin Board under the symbol “SCSG.”


Forward-Looking Statements
 
This release contains forward-looking statements including statements relating to present or future trends or factors generally affecting the banking industry and specifically affecting SouthCrest’s operations, markets and products. Without limiting the foregoing, the words "believes," "anticipates," "intends," "expects," or similar expressions are intended to identify forward-looking statements. These forward-looking statements involve risks and uncertainties. Actual results could differ materially from those projected for many reasons, including, without limitation, changing events and trends that have influenced SouthCrest’s assumptions, but that are beyond SouthCrest’s control. These trends and events include (i) changes in the interest rate environment which may reduce margins, (ii) not achieving expected growth, (iii) less favorable than anticipated changes in the national and local business environment and securities markets, (iv) adverse changes in the regulatory requirements affecting SouthCrest, (v) greater competitive pressures among financial institutions in SouthCrest’s markets and (vi) greater loan losses than historic levels. Additional information and other factors that could affect future financial results are included in SouthCrest’s filings with the Securities and Exchange Commission.
 

# # #
 
Contact Information:

SouthCrest Financial Group, Inc.
Doug Hertha, CFO
770-461-2781



SouthCrest Financial Group, Inc.
  
Consolidated Financial Highlights
  
(Unaudited)
  
                           
   
Quarter Ended June 30
  
Six Months Ended June 30
  
   
2006
  
2005
  
% Change
  
2006
  
2005
  
% Change
  
All dollars in thousands except per share data
                      
EARNINGS
                          
Net interest income
  
$
4,624
  
$
4,315
    
7.2
%
$
9,205
  
$
8,461
    
8.8
%
Provision for loan losses
    
133
   
152
   
-12.5
%
  
241
   
273
   
-11.7
%
Noninterest income
    
1,311
   
1,229
   
6.7
%
  
2,479
   
1,749
   
41.7
%
Noninterest expense
    
3,685
   
3,413
   
8.0
%
  
7,230
   
6,814
   
6.1
%
Income taxes
    
691
   
621
   
11.3
%
  
1,381
   
946
   
46.0
%
Net income
    
1,426
   
1,358
   
5.0
%
  
2,832
   
2,177
   
30.1
%
                                       
PER SHARE INFORMATION
                                      
Earnings per share
  
$
0.40
  
$
0.38
    
5.3
%
$
0.79
  
$
0.61
    
29.5
%
Dividends per share
    
0.125
   
0.120
   
4.2
%
  
0.250
   
0.240
   
4.2
%
Book value per share
    
15.43
   
14.67
   
5.2
%
                  
                                       
OPERATING RATIOS (1)
                                      
Net interest margin
    
4.45
%
  
4.47
%
        
4.48
%
  
4.44
%
      
Return on average assets
    
1.26
%
  
1.29
%
        
1.27
%
  
1.05
%
      
Return on average equity
    
10.45
%
  
10.51
%
        
10.51
%
  
8.54
%
      
Efficiency ratio
    
62.09
%
  
61.56
%
        
63.18
%
  
63.03
%
      
Net chargeoffs / average loans
    
0.00
%
  
0.18
%
        
-0.03
%
  
0.16
%
      
                                       
AVERAGE BALANCES
                                      
Loans
  
$
282,696
  
$
237,533
    
19.0
%
$
279,406
  
$
233,226
    
19.8
%
Total earning assets
    
417,095
   
388,666
   
7.3
%
  
414,491
   
384,018
   
7.9
%
Total assets
    
454,372
   
422,135
   
7.6
%
  
451,403
   
417,908
   
8.0
%
Deposits
    
385,893
   
365,303
   
5.6
%
  
381,008
   
361,528
   
5.4
%
Borrowed funds
    
11,137
   
884
   
n/m
    
13,175
   
629
   
n/m
  
Shareholders' equity
    
54,719
   
51,805
   
5.6
%
  
54,343
   
51,388
   
5.8
%

               
As of
         
   
As of June 30,
     
Dec. 31
         
END OF PERIOD BALANCES
  
2006
  
2005
  
% Change
  
2005
  
% Change
  
 
  
Loans
  
$
287,536
  
$
247,503
    
16.2
%
$
276,780
    
3.9
%
  
 
  
Reserve for loan losses
    
3,759
   
3,253
   
15.6
%
  
3,477
   
8.1
%
  
 
  
Total earning assets
    
415,783
   
390,336
   
6.5
%
  
410,897
   
1.2
%
  
 
  
Intangible assets
    
6,503
   
7,325
   
-11.2
%
  
6,913
   
-5.9
%
      
Total assets
    
461,219
   
425,335
   
8.4
%
  
450,848
   
2.3
%
      
Deposits
    
389,176
   
364,871
   
6.7
%
  
377,900
   
3.0
%
      
Borrowed funds
    
10,220
   
3,890
   
n/m
    
15,275
   
-33.1
%
      
Shareholders' equity
    
55,253
   
52,400
   
5.4
%
  
53,456
   
3.4
%
      
                                       
ASSET QUALITY (END OF PERIOD)
                                      
Loans 90 days past due and still accruing
  
$
469
  
$
386
        
$
549
              
Nonaccrual Loans
    
1,032
   
177
         
232
             
Other Real Estate Owned
    
25
   
255
         
330
             
Total nonperforming assets
    
1,526
   
818
         
1,111
             
Nonperforming assets / total assets
    
0.33
%
  
0.19
%
        
0.25
%
            
Allowance for loan losses / total loans
    
1.31
%
  
1.31
%
        
1.26
%
            
                                       
(1) All ratios are annualized.
                                      
n/m - percentage change is not meaningful.