10-Q 1 d10q.txt FORM 10-Q SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-Q QUARTERLY REPORT UNDER SECTION 13 OR 15 (D) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR QUARTER ENDED MARCH 31, 2001 COMMISSION FILE NUMBER 0-12436 COLONY BANKCORP, INC. -------------------- (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) GEORGIA 58-1492391 ------- ---------- (STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER) 115 SOUTH GRANT STREET, FITZGERALD, GEORGIA 31750 ------------------------------------------------- ADDRESS OF PRINCIPAL EXECUTIVE OFFICES 229/426-6000 ------------ REGISTRANT'S TELEPHONE NUMBER INCLUDING AREA CODE INDICATE BY CHECK MARK WHETHER THE REGISTRANT (1) HAS FILED REPORTS REQUIRED TO BE FILED BY SECTIONS 13 OR 15 (D) OF THE SECURITIES EXCHANGE ACT OF 1934 DURING THE PRECEDING 12 MONTHS (OR FOR SUCH SHORTER PERIOD THAT THE REGISTRANT WAS REQUIRED TO FILE SUCH REPORTS), AND (2) HAS BEEN SUBJECT TO SUCH FILING REQUIREMENTS FOR THE PAST 90 DAYS. YES X NO INDICATE THE NUMBER OF SHARES OUTSTANDING OF EACH OF THE ISSUER'S CLASSES OF COMMON STOCK, AS OF THE CLOSE OF THE PERIOD COVERED BY THIS REPORT. CLASS OUTSTANDING AT MARCH 31, 2001 ----- ----------------------------- COMMON STOCK, $1 PAR VALUE 4,445,526 PART 1 - FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS THE FOLLOWING FINANCIAL STATEMENTS ARE PROVIDED FOR COLONY BANKCORP, INC. AND SUBSIDIARIES: COLONY BANK OF FITZGERALD, COLONY BANK ASHBURN, COLONY BANK WILCOX, COLONY BANK OF DODGE COUNTY, COLONY BANK WORTH, COLONY BANK SOUTHEAST AND COLONY MANAGEMENT SERVICES, INC. A. CONSOLIDATED BALANCE SHEETS - MARCH 31, 2001 AND DECEMBER 31, 2000. B. CONSOLIDATED STATEMENTS OF INCOME - FOR THE THREE MONTHS ENDED MARCH 31, 2001 AND 2000. C. CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - FOR THE THREE MONTHS ENDED MARCH 31, 2001 AND 2000. D. CONSOLIDATED STATEMENTS OF CHANGES IN FINANCIAL POSITION - FOR THE THREE MONTHS ENDED MARCH 31, 2001 AND 2000. THE CONSOLIDATED FINANCIAL STATEMENTS FURNISHED HAVE NOT BEEN AUDITED BY INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS, BUT REFLECT, IN THE OPINION OF MANAGEMENT, ALL ADJUSTMENTS NECESSARY FOR A FAIR PRESENTATION OF THE RESULTS OF OPERATIONS FOR THE PERIODS PRESENTED. THE RESULTS OF OPERATIONS FOR THE THREE MONTH PERIOD ENDED MARCH 31, 2001 ARE NOT NECESSARILY INDICATIVE OF THE RESULTS TO BE EXPECTED FOR THE FULL YEAR. 2 COLONY BANKCORP, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS MARCH 31, 2001 AND DECEMBER 31, 2000 (DOLLARS IN THOUSANDS)
ASSETS March 31, 2001 Dec 31, 2000 -------------- ------------ (Unaudited) Cash and Balances Due from Depository Institutions $ 18,355 $ 18,594 Federal Funds Sold 17,163 21,675 Investment Securities Available for Sale, at Fair Value 77,590 70,222 Held to Maturity, at Cost (Fair Value of $286 and $291, Respectively) 277 293 Loans Held for Sale 2,147 1,513 Loans 408,445 388,007 Allowance for Loan Losses (5,997) (5,661) Unearned Interest and Fees (2) (4) --- --- 402,446 382,342 Premises and Equipment 14,465 14,047 Other Real Estate 502 349 Other Assets 11,027 10,868 -------- -------- Total Assets $543,972 $519,903 ========= ======== LIABILITIES AND STOCKHOLDERS' EQUITY Deposits Noninterest-Bearing $38,499 $38,649 Interest-Bearing 428,131 411,363 -------- -------- 466,630 450,012 Borrowed Money 31,425 25,086 Other Liabilities 3,938 4,595 Stockholders' Equity Common Stock, Par Value $1, Authorized 20,000,000 Shares, Issued 4,445,526 and 4,440,276 Shares as of March 31, 2001 and December 31, 2000, Respectively 4,446 4,440 Paid-In Capital 21,650 21,603 Retained Earnings 15,429 14,436 Restricted Stock - Unearned Compensation (89) (47) Accumulated Other Comprehensive Income, Net of Tax 543 (222) -------- -------- 41,979 40,210 -------- -------- Total Liabilities and Stockholders' Equity $543,972 $519,903 ======== ========
The accompanying notes are an integral part of these balance sheets. 3 COLONY BANKCORP, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME THREE MONTHS ENDED MARCH 31, 2001 AND 2000 (UNAUDITED) (DOLLARS IN THOUSANDS)
Three Months Ended 03/31/01 03/31/00 -------- -------- Interest Income Loans, including fees $ 9,953 $ 7,992 Federal Funds Sold 260 188 Deposits with Other Banks 40 178 Investment Securities U.S. Treasury & Federal Agencies 803 774 State, County and Municipal 83 96 Other Investments 246 16 Dividends on Other Investments 33 28 --------- --------- 11,418 9,272 --------- --------- Interest Expense Deposits 6,062 4,357 Federal Funds Purchased 7 2 Borrowed Money 453 422 --------- --------- 6,522 4,781 --------- --------- Net Interest Income 4,896 4,491 Provision for Loan Losses 286 477 --------- --------- Net Interest Income After Provision for loan losses 4,610 4,014 --------- --------- Noninterest Income Service Charges on Deposits 698 562 Other Service Charges, Commissions & Fees 125 145 Security Gains, net 15 0 Other Income 134 140 --------- --------- 972 847 --------- --------- Noninterest Expense Salaries and Employee Benefits 2,048 1,735 Occupancy and Equipment 675 501 Other Operating Expenses 963 846 --------- --------- 3,686 3,082 --------- --------- Income Before Income Taxes 1,896 1,779 Income Taxes 636 566 --------- --------- Net Income $ 1,260 $ 1,213 ========= ========= Net Income Per Share of Common Stock Basic $ 0.28 $ 0.27 ========= ========= Diluted $ 0.28 $ 0.27 ========= ========= Weighted Average Shares Outstanding 4,445,526 4,440,276 ========= =========
The accompanying notes are an integral part of these statements. 4 COLONY BANKCORP INC. AND SUBSIDIARIES CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME THREE MONTHS ENDED MARCH 31, 2001 AND 2000 (UNAUDITED) (DOLLARS IN THOUSANDS)
Three Months Ended 03/31/01 03/31/00 -------- -------- Net Income $ 1,260 $ 1,213 Other Comprehensive Income, Net of Tax Gains (Losses) on Securities Arising During Year 775 42 Reclassification Adjustment (10) 0 ------- ------- Unrealized Gains (Losses) on Securities 765 42 ------- ------- Comprehensive Income $ 2,025 $ 1,255 ======= =======
The accompanying notes are an integral part of these statements. 5 COLONY BANKCORP, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS THREE MONTHS ENDED MARCH 31, 2001 AND 2000 (UNAUDITED) (DOLLARS IN THOUSANDS)
2001 2000 ---- ---- CASH FLOW FROM OPERATING ACTIVITIES Net Income (loss) $ 1,260 $ 1,213 Adjustments to reconcile net income to net cash provided by operating activities: (Gain) loss on sale of investment securities (15) 0 Depreciation 341 302 Provision for loan losses 286 477 Amortization of excess costs 14 12 Other prepaids, deferrals and accruals, net 488 823 --------- --------- Total Adjustments 1,114 1,614 --------- --------- Net cash provided by operating activities 2,374 2,827 --------- --------- CASH FLOW FROM INVESTING ACTIVITIES Purchase of other assets (FHLB stock) (125) 0 Purchases of securities available for sale (30,549) (675) Proceeds from sales of securities available for sale 12,571 0 Proceeds from maturities, calls, and paydowns of investment securities: Available for Sale 10,102 1,276 Held to Maturity 18 231 Decrease (Increase) in interest-bearing deposits in banks (2,848) (5,730) (Increase) in loans (21,074) (25,729) Purchase of premises and equipment (759) (355) --------- --------- Net cash provided by (used in) investing activities (32,664) (30,982) --------- --------- CASH FLOW FROM FINANCING ACTIVITIES Net increase in deposits 16,618 16,020 Dividends paid (266) (155) Net (decrease) increase in other borrowed money 6,339 5,938 --------- --------- Net cash provided by financing activities 22,691 21,803 --------- --------- Net increase (decrease) in cash and cash equivalents (7,599) (6,352) Cash and cash equivalents at beginning of period 37,357 31,126 --------- --------- Cash and cash equivalents at end of period $ 29,758 $ 24,774 ========= =========
The accompanying notes are an integral part of these statements. 6 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (1) Summary of Significant Accounting Policies ------------------------------------------ Basis of presentation Colony Bankcorp, Inc. is a multi-bank holding company located in Fitzgerald, Georgia. The consolidated financial statements include the accounts of Colony Bankcorp, Inc. and its wholly-owned subsidiaries, Colony Bank of Fitzgerald, Fitzgerald, Georgia; Colony Bank Ashburn, Ashburn, Georgia; Colony Bank Worth, Sylvester, Georgia; Colony Bank of Dodge County, Eastman, Georgia; Colony Bank Wilcox, Rochelle, Georgia; Colony Bank Southeast, Broxton, Georgia (the Banks); and Colony Management Services, Inc., Fitzgerald, Georgia. All significant intercompany accounts have been eliminated in consolidation. The accounting and reporting policies of Colony Bankcorp, Inc. conform to generally accepted accounting principles and practices utilized in the commercial banking industry. In preparing the financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the balance sheet date and revenues and expenses for the period. Actual results could differ significantly from those estimates. Material estimates that are particularly susceptible to significant change in the near-term relate to the determination of the allowance for loan losses, the valuation of real estate acquired in connection with foreclosure or in satisfaction of loans and the valuation of deferred tax assets. Description of Business The Banks provide a full range of retail and commercial banking services for consumers and small to medium size businesses primarily in South Georgia. Lending and investing activities are funded primarily by deposits gathered through its retail branch office network. Lending is concentrated in agricultural, commercial and real estate loans to local borrowers. In management's opinion, although the Banks have a high concentration of agricultural and real estate loans, these loans are well collateralized and do not pose an adverse credit risk. In addition, the balance of the loan portfolio is sufficiently diversified to avoid significant concentration of credit risk. Although the Banks have a diversified loan portfolio, a substantial portion of borrowers' ability to honor their contracts is dependent upon the viability of the real estate economic sector. The success of Colony is dependent, to a certain extent, upon the economic conditions in the geographic markets it serves. No assurance can be given that the current economic conditions will continue. Adverse changes in the economic conditions in these geographic markets would likely have a material adverse effect on the Company's results of operations and financial condition The operating results of Colony depend primarily on its net interest income. Accordingly, operations are subject to risks and uncertainties surrounding the exposure to changes in the interest rate environment. Investment Securities The Company records investment securities under Statement of Financial Accounting Standards (SFAS) No. 115 Accounting for Certain Investments in Debt and Equity Securities. Under the provisions of SFAS No. 115, the Company must classify its securities as trading, available for sale or held to maturity. Trading securities are purchased and held for sale in the near term. Securities held to maturity are those which the Company has the ability and intent to hold until maturity. All other securities not classified as trading or held to maturity are considered available for sale. Securities available for sale are measured at fair value with unrealized gains and losses reported net of deferred taxes as a separate component of stockholders' equity. Fair value represents an approximation of realizable value as of March 31, 2001 and December 31, 2000. Realized and unrealized gains and losses are determined using the specific identification method. Premiums and discounts are recognized in interest income using the interest method over the period to maturity. Loans Held for Sale Mortgage loans held for sale are reported at the lower of cost or market value. The method use to determine this amount is the individual loan method. Loans Loans are generally reported at principal amount less unearned interest and fees. Impaired loans are recorded under SFAS 114, Accounting by Creditors for Impairment of a Loan and SFAS 118, Accounting by Creditors for Impairment of a Loan-Income Recognition and Disclosures. Impaired loans are loans for which principal and interest are unlikely to be collected in accordance with the original loan terms and, generally, represent loans delinquent in excess of 120 days which have been placed on nonaccrual status and for which collateral values are less than outstanding principal and interest. Small balance, homogeneous loans are excluded from impaired loans. Generally, interest payments received on impaired loans are applied to principal. Upon receipt of all loan principal, additional interest payments are recognized as interest income on the cash basis. Other nonaccrual loans are loans for which payments of principal and interest are considered doubtful of collection under original terms but collateral values equal or exceed outstanding principal and interest. 7 (1) Summary of Significant Accounting Policies (continued) ---------------------------------------------------------- Allowance for Loan Losses The allowance method is used in providing for losses on loans. Accordingly, all loan losses decrease the allowance and all recoveries increase it. The provision for loan losses is based on factors which, in management's judgment, deserve current recognition in estimating possible loan losses. Such factors considered by management include growth and composition of the loan portfolio, economic conditions and the relationship of the allowance for loan losses to outstanding loans. An allowance for loan losses is maintained for all impaired loans. Provisions are made for impaired loans upon changes in expected future cash flows or estimated net realizable value of collateral. When determination is made that impaired loans are wholly or partially uncollectible, the uncollectible portion is charged-off. Management believes the allowance for possible loan losses is adequate. While management uses available information to recognize losses on loans, future additions to the allowance may be necessary based on changes in economic conditions. In addition, various regulatory agencies, as an integral part of their examination process, periodically review the Company's allowance for loan losses. Such agencies may require the Company to recognize additions to the allowance based on their judgment about information available to them at the time of their examination. Premises and Equipment Premises and equipment are recorded at acquisition cost net of accumulate depreciation. Depreciation is charged to operations over the estimated useful lives of the assets. The estimated useful lives and methods of depreciation are as follows: Description Life in Years Method ----------- ------------- ------ Banking Premises 15-40 Straight-Line and Accelerated Furniture and Equipment 5-10 Straight-Line and Accelerated Expenditures for major renewals and betterments are capitalized. Maintenance and repairs are charged to operations as incurred. When property and equipment are retired or sold, the cost and accumulated depreciation are removed from the respective accounts and any gain or loss is reflected in other income or expense. Cash Flows For reporting cash flows, cash and cash equivalents include cash on hand, noninterest-bearing amounts due from banks and federal funds sold. Cash flows from demand deposits, NOW accounts, savings accounts, loans and certificates of deposit are reported net. Income Taxes Income taxes are provided for the tax effects of transactions reported in the consolidated financial statements and consist of taxes currently due plus deferred taxes. Deferred taxes are recognized for differences between the basis of assets and liabilities for financial statement and income tax purposes. The differences relate primarily to depreciable assets (use of different depreciation methods for financial statement and income tax purposes) and allowance for loan losses (use of the allowance method for financial statement purposes and the experience method for tax purposes). The deferred tax assets and liabilities represent the future tax return consequences of those differences, which will either be taxable or deductible when the assets and liabilities are recovered or settled. Other Real Estate Other real estate generally represents real estate acquired through foreclosure and is initially recorded at the lower of cost or estimated market value at the date of acquisition. Losses from the acquisitions of property in full or partial satisfaction of debt are recorded as loan losses. Subsequent declines in value, routine holding costs and gains or losses upon disposition are included in other losses. Comprehensive Income Accounting principles generally require that recognized revenue, expenses, gains and losses be included in net income. Certain changes in assets and liabilities, such as unrealized gains and losses on securities available for sale, represent equity changes from economic events of the period other than transactions with owners and are not reported in the consolidated statement of income but as a separate component of the equity section of the consolidated balance sheets. Such items are considered components of other comprehensive income. Statement of Financial Accounting Standards 130 requires the presentation in the financial statements of net income and all items of other comprehensive income as total comprehensive income. Changes in Accounting Principles and Effects of New Accounting Pronouncements In June 1998, the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standard (SFAS) No. 133, Accounting for Derivative Instruments and Hedging Activities, which establishes accounting and reporting standards requiring that 8 every derivative instrument (including certain derivative instruments embedded in other contracts) be recorded in the balance sheet as either an asset or liability measured at its fair value. The Statement requires that changes in the derivative's fair value be recognized currently in earnings unless specific hedge accounting criteria are met. Special accounting for qualifying hedges allows a derivative's gain or loss to offset related results on the hedged item in the income statement, and requires that a company must formally document, designate and assess the effectiveness of transactions that receive hedge accounting. In June 1999, the FASB issued SFAS No. 137, Accounting for Derivative Instruments and Hedging Activities-Deferral of the Effective Date of FASB Statement No. 133, which delays the original effective date of SFAS No. 133 until fiscal year beginning after June 15, 2000. In June 2000, the FASB issued SFAS No. 138, Accounting for Certain Derivative Instruments and Certain Hedging Activities an Amendment of FASB Statement No. 133, which addresses a limited number of issues causing implementation difficulties for certain entities that apply Statement 133. Management does not anticipate that the derivative statements will have a material effect, if any, on the financial position and result of operations of Colony. Restricted Stock - Unearned Compensation In 1999, the board of directors of Colony Bankcorp, Inc. adopted a restricted stock grant plan which awards certain executive officers common shares of the Company. The maximum number of shares which may be subject to restricted stock awards is 44,350. During 2000, 5,250 shares were issued and in 2001, 5,250 shares were issued under this plan. The shares are recorded in fair market value (on the date granted) as a separate component of stockholder's equity. The cost of these shares is being amortized against earnings using the straight-line method over 3 years (the restriction period). (2) Cash and Balances Due from Depository Institutions ------------------------------------------------------ Components of cash and balances due from depository institutions at March 31, 2001 and December 31, 2000 are as follows:
March 31, 2001 December 31, 2000 -------------- ----------------- Cash on Hand and Cash Items $ 4,286 $ 4,846 Noninterest-Bearing Deposits with Other Banks 8,309 10,836 Interest-Bearing Deposits with Other Banks 5,760 2,912 --------- -------- $ 18,355 $ 18,594 ========= ========
(3) Investment Securities ------------------------- Investment securities as of March 31, 2001 are summarized as follows:
Gross Gross Amortized Unrealized Unrealized Fair Cost Gains Losses Value --------- ---------- ---------- --------- Securities Available for Sale U.S. Government Agencies Mortgage-Backed $36,221 $ 399 ($36) $36,584 Other 15,425 137 0 15,562 State, County & Municipal 7,503 96 (8) 7,591 Corporate Obligations 16,399 500 (3) 16,896 Marketable Equity Securities 1,130 0 (173) 957 ------- ------- ------- ------- $76,678 $ 1,132 ($220) $77,590 ======= ======= ======= ======= Securities Held to Maturity: State, County and Municipal $ 277 $ 9 $ 0 $ 286 ======= ======= ======= =======
9 The amortized cost and fair value of investment securities as of March 31, 2001, by contractual maturity, are shown below. Expected maturities will differ from contractual maturities because issuers have the right to call or prepay obligations with or without call or prepayment penalties.
Securities ----------------------------------------------------------------------------- Available for Sale Held to Maturity ------------------ ---------------- Amortized Cost Fair Value Amortized Cost Fair Value ------------------- ---------- --------------- ----------- Due in One Year or Less $ 2,164 $ 2,169 $100 $100 Due After One Year Through Five Years 15,047 15,125 0 0 Due After Five Years Through Ten Years 4,469 4,590 0 0 Due After Ten Years 1,248 1,269 177 186 ------- ------- ---- ---- 22,928 23,153 277 286 Corporate Obligations 16,399 16,896 0 0 Marketable Equity Securities 1,130 957 0 0 Mortgage-Backed Securities 36,221 36,584 0 0 ------- ------- ---- ---- $76,678 $77,590 $277 $286 ======= ======= ==== ====
Investment securities as of December 31, 2000 are summarized as follows:
Gross Gross Amortized Unrealized Unrealized Fair Cost Gains Losses Value ---------- ----------- ----------- ----------- Securities Available for Sale: U.S. Government Agencies Mortgage-Backed Securities $ 15,112 $ 45 ($36) $15,121 Other 35,509 57 (300) 35,266 State, County & Municipal 8,044 33 (57) 8,020 The Banker's Bank Stock 50 0 0 50 Federal Home Loan Bank Stock 1,610 1,610 Marketable Equity Securities 1,130 0 (188) 942 Corporate Obligations 9,007 206 0 9,213 -------- ---- ----- ------- $ 70,462 $341 ($581) $70,222 ======== ==== ===== ======= Securities Held to Maturity: State, County and Municipal $ 293 $ 0 ($2) $ 291 ======== ==== ===== =======
Proceeds from sales of investments available for sale were $12,571 during the first quarter of 2001. Gross realized gains totaled $29 during the first quarter of 2001. Gross realized losses totaled $14 during the first quarter of 2001. Investment securities having a carry value approximating $36,274 and $32,658 as of March 31, 2001 and December 31, 2000, respectively, were pledged to secure public deposits and for other purposes. (4) Loans --------- The composition of loans as of March 31, 2001 and December 31, 2000 was as follows:
March 31, 2001 December 31, 2000 -------------- ----------------- Commercial, Financial and Agricultural $ 43,647 $ 77,448 Real Estate - Construction 7,262 5,961 Real Estate - Farmland 25,597 23,411 Real Estate - Other 253,880 207,396 Installment Loans to Individuals 61,105 59,862 All Other Loans 16,954 13,929 -------- -------- $408,445 $388,007 ======== ========
10 Nonaccrual loans are loans for which principal and interest are doubtful of collection in accordance with original loan terms and for which accruals of interest have been discontinued due to payment delinquency. Nonaccrual loans totaled $6,420 and $5,164 as of March 31, 2001 and December 31, 2000, respectively. On March 31, 2001, the Company had 90 day past due loans with principal balances of $871 and restructured loans with principal balances of $39. (5) Allowance for Loan Losses ------------------------------ Transactions in the allowance for loan losses are summarized below for three months ended March 31, 2001 and March 31, 2000 as follows: March 31, 2001 March 31, 2000 -------------- -------------- Balance, Beginning $5,661 $4,682 Provision Charged to Operating Expenses 286 477 Loans Charged Off (90) (499) Loan Recoveries 140 68 ------ ------ Balance, Ending $5,997 $4,728 ====== ====== (6) Premises and Equipment --------------------------- Premises and equipment are comprised of the following as of March 31, 2001 and December 31, 2000: March 31, 2001 December 31, 2000 -------------- ----------------- Land $ 2,084 $ 1,769 Building 11,049 11,013 Furniture, Fixtures and Equipment 8,867 8,771 Leasehold Improvements 262 262 Construction in Progress 336 48 ------- ------- 22,598 21,863 ------- ------- Accumulated Depreciation (8,133) (7,816) ------- ------- $14,465 $14,047 ======= ======= Depreciation charged to operations totaled $341 and $302 for March 31, 2001 and March 31, 2000 respectively. Certain Company facilities and equipment are leased under various operating leases. Rental expense approximated $37 and $39 for three months ended March 31, 2001 and 2000. Future minimum rental payments to be paid are as follows: Year Ending December 31 Amount ----------- ------ 2001 $149 2002 96 2003 69 2004 10 2005 1 ---- $325 ==== (7) Income Taxes ----------------- The Company records income taxes under SFAS No. 109, Accounting for Income Taxes, which requires an asset and liability approach to financial accounting and reporting for income taxes. Deferred income tax assets and liabilities are computed annually for differences between the financial statement and tax bases of assets and liabilities that will result in taxable or deductible amounts in the future based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. Income tax expense is the tax payable or refundable for the period plus or minus the change during the period in deferred tax assets and liabilities. 11 (8) Deposits ------------ Components of interest-bearing deposits as of March 31, 2001 and December 31, 2000 are as follows: March 31, 2001 December 31, 2000 -------------- ----------------- Interest-Bearing Demand $ 74,308 $ 72,833 Savings 15,191 13,072 Time, $100,000 and Over 115,980 111,875 Other Time 222,652 213,583 -------- -------- $428,131 $411,363 ======== ======== The aggregate amount of short-term jumbo certificates of deposit, each with a minimum denomination of one hundred thousand, was approximately $97,519 and $99,263 as of March 31, 2001 and December 31, 2000, respectively. As of March 31, 2001 and December 31, 2000, the scheduled maturities of certificates of deposits are as follows: Maturity March 31, 2001 December 31, 2000 -------- -------------- ----------------- One Year and Under $280,169 $268,753 One to Three Years 47,305 46,016 Three Years and Over 11,158 10,689 -------- -------- $338,632 $325,458 ======== ======== (9) Borrowed Money ------------------ Borrowed money at March 31, 2001 and December 31, 2000 is summarized as follows: March 31, 2001 December 31, 2000 -------------- ----------------- Federal Home Loan Bank Advances $30,300 $23,800 First Port City Note Payable 578 674 The Banker's Bank Note Payable 547 612 ------- ------- $31,425 $25,086 ======= ======= Advances from the Federal Home Loan Bank (FHLB) have maturities ranging from 2001 to 2010 and interest rates ranging from 4.95 percent to 6.98 percent. Under the Blanket Agreement for Advances and Security Agreement with the FHLB, residential first mortgage loans are pledged as collateral for the FHLB advances outstanding. First Port City note payable was renewed on January 29, 2000 with additional funds added for an amount totaling $963. Annual principal payments of $96 are due with interest paid quarterly at The Wall Street Prime minus one half percent. The debt is secured by commercial real estate in downtown Fitzgerald, which includes the parent company's facilities. Any unpaid balance is due January 29, 2003. The Banker's Bank note payable was renewed on October 23, 2000 for $625 at a rate of The Wall Street Prime minus one half percent. Payments are due monthly with the entire unpaid balance due October 23, 2003. The debt is secured by all furniture, fixtures, machinery, equipment and software of Colony Management Services, Inc. The aggregate stated maturities of borrowed money at March 31, 2001 are as follows: Year Amount ---- ------ 2001 $ 3,391 2002 11,388 2003 6,146 2004 3,000 2005 and Thereafter 7,500 ------- $31,425 ======= 12 (10) Profit Sharing Plan ------------------------ The Company has a profit sharing plan that covers substantially all employees who meet certain age and service requirements. It is the Company's policy to make contributions to the plan as approved annually by the board of directors. The total provision for contributions to the plan was $369 for 2000, $328 for 1999 and $264 for 1998. (11) Commitments and Contingencies ---------------------------------- In the normal course of business, certain commitments and contingencies are incurred which are not reflected in the consolidated financial statements. Commitments under standby letters of credit to U.S. addresses approximate $1,678 as of March 31, 2001 and $1,770 as of December 31, 2000. Unfulfilled loan commitments as of March 31, 2001 and December 31, 2000 approximated $42,170 and $40,495 respectively. No losses are anticipated as a result of commitments and contingencies. (12) Regulatory Capital Matters ------------------------------- The amount of dividends payable to the parent company from the subsidiary banks is limited by various banking regulatory agencies. The amount of cash dividends available from subsidiaries for payment in 2001 without prior approval from the banking regulatory agencies approximates $2,256. Upon approval by regulatory authorities, the banks may pay cash dividends to the parent company in excess of regulatory limitations. The Company is subject to various regulatory capital requirements administered by federal banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory and, possibly, additional discretionary actions by regulators that, if undertaken, could have a direct material effect on the Company's consolidated financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Company must meet specific capital guidelines that involve quantitative measures of the Company's assets, liabilities and certain off-balance sheet items as calculated under regulatory accounting practices. The Company's capital amounts and classifications are also subject to qualitative judgments by the regulators about components, risk weightings and other factors. Quantitative measures established by regulation to ensure capital adequacy require the Company to maintain minimum amounts and ratios of total and Tier 1 capital to risk-weighted assets, and of Tier 1 capital to average assets. The amounts and ratios as defined in regulations are presented hereafter. Management believes, as of March 31, 2001, the Company meets all capital adequacy requirements to which it is subject and is classified as well capitalized under the regulatory framework for prompt corrective action. In the opinion of management, there are no conditions or events since prior notification of capital adequacy from the regulators that have changed the institution's category.
To Be Well Capitalized For Capital Under Prompt Corrective Actual Adequacy Purposes Action Provisions ------ --------------------- -------------------- Amount Ratio Amount Ratio Amount Ratio ------ ----- ------ ----- ------ ----- As of March 31, 2001 Total Capital to Risk-Weighted Assets $46,214 10.73% $34,446 8.00% $43,057 10.00% Tier 1 Capital to Risk-Weighted Assets 40,824 9.48% 17,223 4.00% 25,834 6.00% Tier 1 Capital to Average Assets 40,824 7.77% 21,008 4.00% 26,260 5.00% As of December 31, 2000 Total Capital to Risk-Weighted Assets $44,990 10.88% $33,068 8.00% $41,335 10.00% Tier 1 Capital to Risk-Weighted Assets 39,817 9.63% 16,534 4.00% 24,801 6.00% Tier 1 Capital to Average Assets 39,817 7.80% 20,397 4.00% 25,496 5.00%
13 (13) Financial Information of Colony Bankcorp, Inc. (Parent Only) ----------------------------------------------------------------- The parent company's balance sheets as of March 31, 2001 and December 31, 2000 and the related statements of income and comprehensive income and cash flows are as follows: COLONY BANKCORP, INC. (PARENT ONLY) BALANCE SHEETS FOR PERIOD ENDED MARCH 31, 2001 AND DECEMBER 31, 2000
ASSETS March 31, 2001 December 31, 2000 -------------- ----------------- Cash $ 43 $ 4 Investments in Subsidiaries at Equity 41,052 39,875 Other 1,317 1,354 --------- -------- Totals Assets $ 42,412 $ 41,233 ========= ======== LIABILITIES AND STOCKHOLDERS' EQUITY Liabilities Dividends Payable $ 266 $ 266 Notes and Debentures Payable 578 674 Other (411) 83 --------- -------- 433 1,023 Stockholders' Equity Common Stock, Par Value $1 a Share; Authorized 20,000,000 Shares, Issued 4,445,526 and 4,440,276 Shares as of March 31, 2001 and December 31, 2000 Respectively 4,446 4,440 Paid-In Capital 21,650 21,603 Retained Earnings 15,429 14,436 Restricted Stock - Unearned Compensation (89) (47) Accumulated Other Comprehensive Income, Net of Tax 543 (222) --------- -------- Total Stockholders' Equity 41,979 40,210 --------- -------- Total Liabilities and Stockholders' Equity $ 42,412 $ 41,233 ========= ========
14 (13) Financial Information of Colony Bankcorp, Inc. (Parent Only) (continued) ----------------------------------------------------------------------------- COLONY BANKCORP, INC. (PARENT ONLY) STATEMENT OF INCOME AND COMPREHENSIVE INCOME FOR THE THREE MONTHS ENDED MARCH 31, 2001 AND MARCH 31, 2000
March 31, 2001 March 31, 2000 -------------- -------------- Income Dividends from Subsidiaries $ 994 $ 619 Other 18 18 ------ ------ $1,012 $ 637 ------ ------ Expenses Interest 13 14 Amortization 4 4 Other 220 175 ------ ------ $ 237 $ 193 ------ ------ Income Before Taxes and Equity in Undistributed Earnings of Subsidiaries 775 444 Income Tax (Benefits) (73) (56) ------ ------ Income Before Taxes and Equity in Undistributed Earnings of Subsidiaries 848 500 Equity in Undistributed Earnings of Subsidiaries 412 713 ------ ------ Net Income 1,260 1,213 ------ ------ Other Comprehensive Income, Net of Tax Gains (losses) on Securities Arising During Year 775 42 Reclassification Adjustment (10) 0 ------ ------ Unrealized Gains (Losses) in Securities 765 42 ------ ------ Comprehensive Income $2,025 $1,255 ====== ======
15 (13) Financial Information of Colony Bankcorp, Inc. (Parent Only) (continued) ----------------------------------------------------------------------------- COLONY BANKCORP, INC. (PARENT ONLY) STATEMENT OF CASH FLOWS FOR THE THREE MONTHS ENDED MARCH 31, 2001 AND MARCH 31, 2000
March 31, 2001 March 31, 2000 -------------- -------------- Cash Flows from Operating Activities Net Income $1,260 $1,213 Adjustments to Reconcile Net Income to Net Cash Provided from Operating Activities Depreciation and Amortization 17 22 Equity in Undistributed Earnings of Subsidiary (412) (713) Other (464) (105) ------ ------ 401 417 ------ ------ Cash Flows from Investing Activities Capital Infusion in Subsidiary 0 (500) Purchase of Premises and Equipment 0 0 ------ ------ 0 (500) ------ ------ Cash Flows from Financing Activities Dividends Paid (266) (155) Proceeds from Issuance of Common Stock 0 0 Principal Payments on Notes and Debentures (96) 0 Proceeds from Notes and Debentures 0 0 ------ ------ (362) (155) ------ ------ Increase (Decrease) in Cash and Cash Equivalents 39 (238) Cash and Cash Equivalents, Beginning 4 247 ------ ------ Cash and Cash Equivalents, Ending $ 43 $ 9 ====== ======
(14) Legal Contingencies ------------------------- In the ordinary course of business, there are various legal proceedings pending against Colony and its subsidiaries. The aggregate liabilities, if any, arising from such proceedings would not, in the opinion of management, have a material adverse effect on Colony's consolidated financial position. (15) Stock Grant Plan ---------------------- On February 16, 1999, a restricted stock grant plan was approved by the Board. The plan was adopted for the purpose of establishing incentives designed to recognize, reward and retain executive employees whose performance, contribution and skills are critical to the Company. The plan period commences February 16, 1999 and ends February 15, 2009 with the maximum number of shares subject to restricted stock awards being 22,175 shares (44,350 shares after the two-for-one stock split effective September 30, 1999). On January 3, 2000, the Company issued 5,250 shares under the stock grant plan to increase the total outstanding shares from 4,435,026 at December 31, 1999 to 4,440,276 at September 30, 2000. 16 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Liquidity and Capital Resources Liquidity represents the ability to provide adequate sources of funds for funding loan commitments and investment activities, as well as the ability to provide sufficient funds to cover deposit withdrawals, payment of debt and financing of operations. Converting assets to cash for these funds is primarily with proceeds from collections on loans and maturities of investment securities or by attracting and obtaining new deposits. For the three months ended March 31, 2001, the Company was successful in meeting its liquidity needs by increasing deposits 3.69% to $466,630,000 from deposits of $450,012,000 on December 31, 2000, by reducing Federal Funds 20.82% to $17,163,000 from $21,675,000 on December 31, 2000 and by increasing other borrowed money 25.27% to $31,425,000 from $25,086,000 on December 31, 2000. Should the need arise, the Company also maintains relationships with the Federal Home Loan Bank and several correspondent banks that can provide funds on short notice. The Company's liquidity position remained acceptable for the three months ended March 31, 2001. Average liquid assets (cash and amounts due from banks, interest-bearing deposits in other banks, funds due and securities) represented 23.63 percent of average deposits for three months ended March 31, 2001 as compared to 26.33 percent of average deposits for three months ended March 31, 2000 and 25.22 percent for calendar year 2000. Average loans represented 87.58 percent of average deposits for the three months ended March 31, 2001 as compared to 85.59 percent for three months ended March 31, 2000 and 87.97 percent for calendar year 2000. Average interest-bearing deposits were 84.64 percent of average earning assets for three month period ended March 31, 2001 as compared to 82.96 percent for three months ended March 31, 2000 and 82.96 percent for calendar year 2000. The Company satisfies most of its capital requirements through retained earnings. During the first three months of 2001, retained earnings provided $994,000 of increase in equity. Additionally, equity had an increase of $765,000 resulting from the change during the quarter in unrealized gains on securities available for sale, net of taxes and an increase of $10,000 resulting from the stock grant plan. Thus, total equity increased by a net amount of $1,769,000 for the three month period ended March 31, 2001. This compares to growth in equity of $1,036,000 from retained earnings, $42,000 increase resulting from changes in unrealized losses on securities and $6,000 increase resulting from the stock grant plan, or total equity increase of $1,084,000 for the three months ended March 31, 2000. Total equity increased by a net amount of $5,199,000 for calendar year 2000. As of March 31, 2001, the Company's capital totaled approximately $41,979,000 and the only outstanding commitment for capital expenditures was by a subsidiary bank for construction of a branch facility in Lee County. Total cost of the facility will be approximately $1,200,000 with approximately $400,000 paid as of March 31, 2001 for construction completed. The Federal Reserve Board and the FDIC have issued risk-based capital guidelines for U. S. banking organizations. The objective of these efforts was to provide a more uniform framework that is sensitive to differences in risk assets among banking organizations. The guidelines define a two-tier capital framework. Tier 1 capital consists of common stock and qualifying preferred stockholders' equity less goodwill. Tier 2 capital consists of certain convertible, subordinated and other qualifying term debt and the allowance for loan losses up to 1.25 percent of risk-weighted assets. The Company has no Tier 2 capital other than the allowance for loan losses. Using the capital requirements presently in effect, the Tier 1 ratio as of March 31, 2001 was 9.48 percent and total Tier 1 and 2 risk-based capital was 10.73 percent. Both of these measures compare favorably with the regulatory minimum of 4 percent for Tier 1 and 8 percent for total risk-based capital. The Company's Tier 1 leverage ratio was 7.77 percent as of March 31, 2001 which exceeds the required ratio standard of 4 percent. For the three month period ended March 31, 2001, average capital was $41,069,000 representing 7.81 percent of average assets for the quarter. This compares to 7.98 percent for the three month period ended March 31, 2000 and 7.81 percent for calendar year 2000. For the first quarter of 2001, the Company paid quarterly dividends of $0.06 per share compared to $0.04 per share for the first quarter of 2000. The dividend payout ratio, defined as dividends per share divided by net income per share, was 21.43 percent for three months ended March 31, 2001 as compared to 14.18 percent for three months ended March 31, 2000. As of March 31, 2001, management was not aware of any recommendations by regulatory authorities which if they were to be implemented, would have a material effect on the Company's liquidity, capital resources or results of operations. However, it is possible that examinations by regulatory authorities in the future could precipitate additional loss charge-offs that could materially impact the Company's liquidity, capital resources and results of operations. Results of Operations The Company's results of operations are determined by its ability to effectively manage interest income and expense, to minimize loan and investment losses, to generate noninterest income and to control noninterest expense. Since market forces and economic 17 conditions beyond the control of the Company determine interest rates, the ability to generate net interest income is dependent upon the Company's ability to obtain an adequate spread between the rate earned on earning assets and the rate paid on interest-bearing liabilities. Thus, the key performance for net interest income is the interest margin or net yield, which is taxable-equivalent net interest income divided by average earning assets. Net Income Net income for the three months ended March 31, 2001 was $1,260,000 as compared to $1,213,000 for the three months ended March 31, 2000, or an increase of 3.87 percent. This increase is the result of an increase in net interest income of $405,000, a decrease in provision for loan losses of $191,000 and an increase in noninterest income of $125,000. These were offset by an increase in noninterest expense of $604,000 and an increase in income tax expenses of $70,000. On a fully diluted share basis, net income increased to $0.28 per share for the three months ended March 31, 2001 from $0.27 for the same period in 2000, or an increase of 3.70 percent. Net Interest Margin Net interest margin decreased by 36 basis points to 4.02 percent in first quarter 2001 as compared to 4.38 percent in first quarter 2000. The net interest margin compression was primarily attributable to U. S. Federal Reserve lowering interest rates 150 basis points during the first quarter. Margin compression during the quarter was offset by an increase in average earning assets that resulted in net interest income increasing by 9.02 percent to $4,896,000 in first quarter 2001 from $4,491,000 for the same period in 2000. Average earning assets increased to $493,311,000 in first quarter 2001 from $416,689,000 in first quarter 2000. Average loans increased by $71,887,000 or 22.03 percent, average funds sold increased by $4,310,000 or 32.07 percent, average investment securities increased by $7,866,000 or 12.13 percent, average interest-bearing deposits in other banks decreased by $9,109,000 or 75.42 percent and average interest-bearing other assets increased $1,668,000 or 100.00 percent resulting in a net increase in average earning assets of $76,622,000 or 18.39 percent. The net increase in average assets was funded by a net increase in average deposits of 19.27 percent to $454,704,000 in first quarter 2001 from $381,249,000 in first quarter 2000. Average interest-bearing deposits increased by 20.79 percent to $417,560,000 in first quarter 2001 from $345,695,000 in first quarter 2000 while average noninterest-bearing deposits increased 4.47 percent to $37,144,000 in first quarter 2001 from $35,554,000 in first quarter 2000. Average noninterest-bearing deposits represented 8.17 percent of average total deposits in first quarter 2001 as compared to 9.33 percent in first quarter 2000 and 8.52 percent for calendar year 2000. Interest expense increased for the three months ended March 31, 2001 by $1,741,000 compared to the same period in 2000. The increase is primarily attributable to the increase in average interest-bearing deposits to $417,560,000 for the first quarter 2001 compared to $345,695,000 for the same period in 2000. The combination of the increase in average earning assets and the decrease in the net interest margin resulted in an increase of net interest income of $405,000 for the three months ended March 31, 2001 compared to the same period in 2000. Provision for Loan Losses The allowance for loan losses represents a reserve for potential losses in the loan portfolio. The adequacy of the allowance for loan losses is evaluated periodically based on a review of all significant loans, with a particular emphasis on nonaccruing, past due and other loans that management believes require attention. The provision for loan losses is a charge to earnings in the current period to replenish the allowance for loan losses and maintain it at a level management has determined to be adequate. The provision for loan losses was $286,000 for the three months ended March 31, 2001 as compared to $477,000 for the three months ended March 31, 2000, representing a decrease of $191,000 or 40.04 percent. Net loan charge-offs (recoveries) represented (17.83) percent of the provision for loan losses in the first quarter of 2001 as compared to 90.57 percent in the first quarter of 2000. Net loan charge-offs (recoveries) for the three months ended March 31, 2001 were (0.01) percent of average loans, down from 0.13 percent for the same period a year ago. The leveling off of loan charge-offs results from management's effort the past several years to improve credit quality and to eliminate weak and marginal credits. As of March 31, 2001, the allowance for loan losses was 1.46 percent of total loans outstanding as compared to an allowance for loan losses of 1.39 percent of total loans outstanding as of March 31, 2000. The loan loss reserve of 1.46 percent of total loans outstanding provided coverage of 82.22 percent of nonperforming loans and 76.92 percent of nonperforming assets as of March 31, 2001 compared to 72.23 percent and 65.10 percent, respectively as of March 31, 2000. The determination of the reserve rests upon management's judgment about factors affecting loan quality and assumptions about the economy. Management considers the March 31, 2001 allowance for loan losses adequate to cover potential losses in the loan portfolio. 18 Noninterest Income Noninterest income consists primarily of service charges on deposit accounts. Service charges on deposit accounts totaled $698,000 in first quarter 2001 compared to $562,000 in first quarter 2000 or an increase of 24.20 percent. This increase is attributable to the increase in noninterest-bearing and interest-bearing demand deposits. All other noninterest income decreased to $274,000 in first quarter 2001 from $285,000 a year ago, or a 3.86 percent decrease. Thus, total noninterest income for first quarter 2001 was $972,000 compared to $847,000 in first quarter 2000, or an increase of 14.76 percent. Noninterest Expense Noninterest expense increased by 19.60 percent to $3,686,000 in three months ended March 31, 2001 from $3,082,000 for the same period a year ago. Salaries and employee benefits increased 18.04 percent to $2,048,000 in first quarter 2001 from $1,735,000 in first quarter 2000 primarily due to increased staffing with two new branches opened in Fall 2000 and the acquisition of a mortgage company in March, 2000. Occupancy and equipment expense increased by 34.73 percent to $675,000 in first quarter 2001 from $501,000 in first quarter 2000 primarily due to additional depreciation and occupancy expense with the new offices opened during 2000. All other noninterest expense increased 13.83 percent to $963,000 in first quarter 2001 from $846,000 in first quarter 2000. Other increases in noninterest expense are primarily attributable to expenses incurred in opening two new offices and the mortgage company during 2000. Income Tax Expense Income before taxes increased by $117,000 to $1,896,000 in first quarter 2001 from $1,779,000 in first quarter 2001. Income tax expense increased 12.37 percent to $636,000 in first quarter 2001 from $566,000 in first quarter 2000. Income tax expense as a percentage of income before taxes was 33.54 percent in first quarter 2001 compared to 31.82 percent in first quarter 2000 or an increase of 5.41 percent. Future Outlook Colony is an emerging company operating in an industry filled with nonregulated competitors and a rapid pace of consolidation. The year brings with it new opportunities for growth in our existing markets, as well as opportunities to expand into new markets through branch acquisitions and branching. Colony completed two new branches in 2000, which are located in Moultrie and Soperton, Georgia. In addition Colony acquired Georgia First Mortgage Company located in Albany, Georgia during 2000. For 2001, Colony has targeted one new branch office to be located in the Dougherty/Lee County market and one loan production office to be located in the Warner Robins market. The Warner Robins office would be converted to a full-service branch office in 2002. Liquidity The Company's goals with respect to liquidity are to ensure that sufficient funds are available to meet current operating requirements and to provide reserves against unforeseen liquidity requirements. Management continuously reviews the Company's liquidity position, which is maintained on a basis consistent with established internal guidelines and the tests and reviews of the various regulatory authorities. The Company's primary liquidity sources at March 31, 2001 included cash, due from banks, federal funds and short-term investment securities. The Company also has the ability, on a short-term basis, to borrow funds from Federal Home Loan Bank and correspondent banks. The mix of asset maturities contributes to the company's overall liquidity position. Certain Transactions In the normal course of business, officers and directors of the Banks, and certain business organizations and individuals associated with them, maintain a variety of banking relationships with the bank. Transactions with senior officers and directors are made on terms comparable to those available to other bank customers. Forward-Looking Statements This document contains statements that constitute "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The words "believe," "estimate," "expect," "intend," "anticipate" and similar expressions and variations thereof identify certain of such forward-looking statements, which speaks only as of the dates which they were made. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. Users are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially from those indicated in the forward-looking statements as a result of various factors. Users are therefore cautioned not to place undue reliance on these forward-looking statements. 19 BUSINESS General The Company was organized in 1983 as a bank holding company through the merger of Colony Bank of Fitzgerald with a subsidiary of the Company. Since that time, Colony Bank of Fitzgerald, which was formed by principals of Colony Bankcorp, Inc. in 1976, has operated as wholly-owned subsidiary of the Company. In April 1984, Colony Bankcorp, Inc. acquired Colony Bank Wilcox, and in November 1984, Colony Bank Ashburn became a wholly-owned subsidiary of Colony Bankcorp, Inc. Colony Bankcorp, Inc. continued its growth with the acquisition of Colony Bank of Dodge County in September 1985. In August 1991, Colony Bankcorp, Inc. acquired Colony Bank Worth. In November 1996, Colony Bankcorp, Inc. acquired Colony Bank Southeast and in November, 1996 formed a non-bank subsidiary Colony Management Services, Inc. Through its six subsidiary banks, Colony Bankcorp, Inc. operates a full-service banking business and offers a broad range of retail and commercial banking services including checking, savings, NOW accounts, money market and time deposits of various types; loans for business, agriculture, real estate, personal uses, home improvement and automobiles; credit card; letters of credit; trust services investment, and discount brokerage services; IRA's, safe deposit box rentals, bank money orders, and electronic funds transfer services, including wire transfers and automated teller machines. Each of the Banks is a state chartered institution whose customer deposits are insured up to applicable limits by the Federal Deposit Insurance Corporation. On April 2, 1998, the Company was listed on Nasdaq National Market. The Company's common stock trades on the Nasdaq Stock Market under the symbol "CBAN". The Company presently has 1,156 shareholders of record as of March 31, 2001. "The Nasdaq Stock Market" or "Nasdaq" is a highly-regulated electronic securities market comprised of competing Market Makers whose trading is supported by a communications network linking them to quotation dissemination, trade reporting and order execution systems. This market also provides specialized automation services for screen-based negotiations of transactions, on-line comparison of transactions, and a range of informational services tailored to the needs of the securities industry, investors and issuers. The Nasdaq Stock Market is operated by The Nasdaq Stock Market, Inc., a wholly-owned subsidiary of the National Association of Securities Dealers, Inc. PART II - OTHER INFORMATION ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K ----------------------------------------- A. Exhibits - None B. There have been no reports filed on Form 8-K for the quarter ended March 31, 2001 20 SIGNATURE Pursuant to the requirements of the Securities and Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. COLONY BANKCORP, INC. May 8, 2001 James D. Minix ------------------------ --------------------------------------------- Date James D. Minix, President and Chief Executive Officer Terry L. Hester --------------------------------------------- Terry L. Hester, Executive Vice President and Chief Financial Officer 21