FOR QUARTER ENDED JUNE 30, 2013
|
COMMISSION FILE NUMBER 0-12436
|
GEORGIA
|
|
58-1492391
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(STATE OR OTHER JURISDICTION OF INCORPORATION OR ORGANIZATION)
|
|
(I.R.S. EMPLOYER IDENTIFICATION NUMBER)
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LARGE ACCELERATED FILER ¨
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ACCELERATED FILER ¨
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NON-ACCELERATED FILER ¨
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SMALLER REPORTING COMPANY x
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(DO NOT CHECK IF A SMALLER REPORTING COMPANY)
|
CLASS
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OUTSTANDING AT AUGUST 5, 2013
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COMMON STOCK, $1 PAR VALUE
|
8,439,258
|
|
Page
|
||
PART I – Financial Information
|
|
||
|
|
|
|
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Forward Looking Statement Disclosure
|
3
|
|
|
|
|
|
|
Item 1.
|
4
|
|
|
Item 2.
|
38
|
|
|
Item 3.
|
53
|
|
|
Item 4.
|
54
|
|
|
|
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PART II – Other Information
|
|
||
|
|
|
|
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Item 1.
|
55
|
|
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Item 1A.
|
55
|
|
|
Item 2.
|
55
|
|
|
Item 3.
|
55
|
|
|
Item 4.
|
55
|
|
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Item 5.
|
55
|
|
|
Item 6.
|
56
|
|
|
58
|
· | Loss and regional economic conditions and the impact they may have on the Company and its customers and the Company's assessment of that impact. |
· | Changes in estimates of future reserve requirements based upon the periodic review thereof under relevant regulatory and accounting requirements. |
· | The effects of and changes in trade, monetary and fiscal policies and laws, including interest rate policies of the Federal Reserve Board. |
· | Inflation, interest rate, market and monetary fluctuations. |
· | Political instability. |
· | Acts of war or terrorism. |
· | The timely development and acceptance of new products and services and perceived overall value of these products and services by users. |
· | Changes in consumer spending, borrowings and savings habits. |
· | Technological changes. |
· | Acquisitions and integration of acquired businesses. |
· | The ability to increase market share and control expenses. |
· | The effect of changes in laws and regulations (including laws and regulations concerning taxes, banking, securities and insurance) with which the Company and its subsidiary must comply. |
· | The effect of changes in accounting policies and practices, as may be adopted by the regulatory agencies, as well as the Financial Accounting Standards Board and other accounting standard setters. |
· | Changes in the Company's organization, compensation and benefit plans. |
· | The costs and effects of litigation and of unexpected or adverse outcomes in such litigation. |
· | Greater than expected costs or difficulties related to the integration of new lines of business. |
· | The Company's success at managing the risks involved in the foregoing items. |
· | Restrictions or conditions imposed by our regulators on our operations, including the terms of our Memorandum of Understanding. |
PART 1. | FINANCIAL INFORMATION |
D. | CONSOLIDATED STATEMENTS OF CASH FLOWS – FOR THE SIX MONTHS ENDED JUNE 30, 2013 AND 2012 (UNAUDITED). |
|
June 30, 2013
|
December 31, 2012
|
||||||
ASSETS
|
(Unaudited)
|
(Audited)
|
||||||
|
||||||||
Cash and Cash Equivalents
|
||||||||
Cash and Due from Banks
|
$
|
17,051
|
$
|
29,244
|
||||
Federal Funds Sold
|
9,918
|
20,002
|
||||||
|
26,969
|
49,246
|
||||||
Interest-Bearing Deposits
|
13,408
|
21,795
|
||||||
Investment Securities
|
||||||||
Available for Sale, at Fair Value
|
267,131
|
268,301
|
||||||
Held to Maturity, at Cost (Fair Value of $38 and $42, as of June 30, 2013 and December 31, 2012, Respectively)
|
38
|
41
|
||||||
|
267,169
|
268,342
|
||||||
|
||||||||
Federal Home Loan Bank Stock, at Cost
|
3,164
|
3,364
|
||||||
Loans
|
744,143
|
747,050
|
||||||
Allowance for Loan Losses
|
(12,957
|
)
|
(12,737
|
)
|
||||
Unearned Interest and Fees
|
(266
|
)
|
(234
|
)
|
||||
|
730,920
|
734,079
|
||||||
Premises and Equipment
|
25,035
|
24,916
|
||||||
Other Real Estate (Net of Allowance of $4,274 and $4,561 as of June 30, 2013 and December 31, 2012, Respectively)
|
16,128
|
15,941
|
||||||
Other Intangible Assets
|
206
|
224
|
||||||
Other Assets
|
23,455
|
21,490
|
||||||
Total Assets
|
$
|
1,106,454
|
$
|
1,139,397
|
||||
|
||||||||
LIABILITIES AND STOCKHOLDERS' EQUITY
|
||||||||
Deposits
|
||||||||
Noninterest-Bearing
|
$
|
111,478
|
$
|
123,967
|
||||
Interest-Bearing
|
831,859
|
855,718
|
||||||
|
943,337
|
979,685
|
||||||
Borrowed Money
|
||||||||
Subordinated Debentures
|
24,229
|
24,229
|
||||||
Other Borrowed Money
|
40,000
|
35,000
|
||||||
|
64,229
|
59,229
|
||||||
|
||||||||
Other Liabilities
|
7,148
|
4,724
|
||||||
Commitments and Contingencies
|
||||||||
Stockholders' Equity
|
||||||||
Preferred Stock, Stated Value $1,000 a Share; Authorized 10,000,000 Shares, Issued 28,000 Shares
|
27,912
|
27,827
|
||||||
Common Stock, Par Value $1 a Share; Authorized 20,000,000 Shares, Issued 8,439,258 and 8,439,258 Shares as of June 30, 2013 and December 31, 2012, Respectively
|
8,439
|
8,439
|
||||||
Paid-In Capital
|
29,145
|
29,145
|
||||||
Retained Earnings
|
31,590
|
30,498
|
||||||
Accumulated Other Comprehensive (Loss), Net of Tax
|
(5,346
|
)
|
(150
|
)
|
||||
|
91,740
|
95,759
|
||||||
Total Liabilities and Stockholders' Equity
|
$
|
1,106,454
|
$
|
1,139,397
|
|
Three Months Ended
|
Six Months Ended
|
||||||||||||||
|
June 30, 2013
|
June 30, 2012
|
June 30, 2013
|
June 30, 2012
|
||||||||||||
Interest Income
|
||||||||||||||||
Loans, Including Fees
|
$
|
10,359
|
$
|
10,433
|
$
|
20,720
|
$
|
20,853
|
||||||||
Federal Funds Sold
|
6
|
30
|
20
|
56
|
||||||||||||
Deposits with Other Banks
|
5
|
10
|
16
|
30
|
||||||||||||
Investment Securities
|
||||||||||||||||
U.S. Government Agencies
|
862
|
1,390
|
1,574
|
3,009
|
||||||||||||
State, County and Municipal
|
31
|
65
|
64
|
131
|
||||||||||||
Corporate Obligations and Asset-Backed Securities
|
14
|
25
|
28
|
48
|
||||||||||||
Dividends on Other Investments
|
19
|
20
|
38
|
37
|
||||||||||||
|
11,296
|
11,973
|
22,460
|
24,164
|
||||||||||||
Interest Expense
|
||||||||||||||||
Deposits
|
1,405
|
2,253
|
3,091
|
4,723
|
||||||||||||
Borrowed Money
|
436
|
629
|
868
|
1,466
|
||||||||||||
|
1,841
|
2,882
|
3,959
|
6,189
|
||||||||||||
|
||||||||||||||||
Net Interest Income
|
9,455
|
9,091
|
18,501
|
17,975
|
||||||||||||
Provision for Loan Losses
|
1,200
|
1,943
|
2,700
|
3,885
|
||||||||||||
Net Interest Income After Provision for Loan Losses
|
8,255
|
7,148
|
15,801
|
14,090
|
||||||||||||
|
||||||||||||||||
Noninterest Income
|
||||||||||||||||
Service Charges on Deposits
|
1,147
|
814
|
2,248
|
1,610
|
||||||||||||
Other Service Charges, Commissions and Fees
|
443
|
328
|
847
|
747
|
||||||||||||
Mortgage Fee Income
|
141
|
112
|
260
|
193
|
||||||||||||
Securities Gains (Losses)
|
6
|
743
|
(2
|
)
|
880
|
|||||||||||
Other
|
303
|
377
|
897
|
758
|
||||||||||||
|
2,040
|
2,374
|
4,250
|
4,188
|
||||||||||||
Noninterest Expenses
|
||||||||||||||||
Salaries and Employee Benefits
|
4,149
|
3,833
|
8,318
|
7,653
|
||||||||||||
Occupancy and Equipment
|
935
|
963
|
1,868
|
1,901
|
||||||||||||
Other
|
3,655
|
3,609
|
6,945
|
6,834
|
||||||||||||
|
8,739
|
8,405
|
17,131
|
16,388
|
||||||||||||
|
||||||||||||||||
Income Before Income Taxes
|
1,556
|
1,117
|
2,920
|
1,890
|
||||||||||||
Income Taxes
|
570
|
357
|
997
|
589
|
||||||||||||
Net Income
|
986
|
760
|
1,923
|
1,301
|
||||||||||||
Preferred Stock Dividends
|
375
|
357
|
745
|
709
|
||||||||||||
Net Income Available to Common Stockholders
|
$
|
611
|
$
|
403
|
$
|
1,178
|
$
|
592
|
||||||||
Net Income Per Share of Common Stock
|
||||||||||||||||
Basic
|
$
|
0.07
|
$
|
0.05
|
$
|
0.14
|
$
|
0.07
|
||||||||
Diluted
|
$
|
0.07
|
$
|
0.05
|
$
|
0.14
|
$
|
0.07
|
||||||||
Cash Dividends Declared Per Share of Common Stock
|
$
|
0.00
|
$
|
0.00
|
$
|
0.00
|
$
|
0.00
|
||||||||
Weighted Average Basic Shares Outstanding
|
8,439,258
|
8,439,258
|
8,439,258
|
8,439,258
|
||||||||||||
Weighted Average Diluted Shares Outstanding
|
8,439,258
|
8,439,258
|
8,439,258
|
8,439,258
|
|
Three Months Ended
|
Six Months Ended
|
||||||||||||||
|
June 30, 2013
|
June 30, 2012
|
June 30, 2013
|
June 30, 2012
|
||||||||||||
|
||||||||||||||||
Net Income
|
$
|
986
|
$
|
760
|
$
|
1,923
|
$
|
1,301
|
||||||||
|
||||||||||||||||
Other Comprehensive Income (Loss), Net of Tax
|
||||||||||||||||
Gains (Losses) on Securities Arising During the Year
|
(4,303
|
)
|
( 30
|
)
|
(5,197
|
)
|
385
|
|||||||||
Reclassification Adjustment
|
(4
|
)
|
(490
|
)
|
1
|
(581
|
)
|
|||||||||
|
||||||||||||||||
Change in Net Unrealized Gains (Losses) on Securities Available for Sale, Net of Reclassification Adjustment and Tax Effect
|
(4,307
|
)
|
(520
|
)
|
(5,196
|
)
|
(196
|
)
|
||||||||
|
||||||||||||||||
Comprehensive Income (Loss)
|
$
|
(3,321
|
)
|
$
|
240
|
$
|
(3,273
|
)
|
$
|
1,105
|
|
Six Months Ended
|
|||||||
|
June 30, 2013
|
June 30, 2012
|
||||||
CASH FLOWS FROM OPERATING ACTIVITIES
|
||||||||
Net Income
|
$
|
1,923
|
$
|
1,301
|
||||
Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities:
|
||||||||
Depreciation
|
777
|
830
|
||||||
Provision for Loan Losses
|
2,700
|
3,885
|
||||||
Securities Gains (Losses)
|
2
|
(880
|
)
|
|||||
Amortization and Accretion
|
1,673
|
2,073
|
||||||
Loss on Sale of Other Real Estate and Repossessions
|
540
|
396
|
||||||
Provision for Losses on Other Real Estate
|
892
|
752
|
||||||
Increase in Cash Surrender Value of Life Insurance
|
(99
|
)
|
(110
|
)
|
||||
Other Prepaids, Deferrals and Accruals, Net
|
2,489
|
3,817
|
||||||
|
10,897
|
12,064
|
||||||
CASH FLOWS FROM INVESTING ACTIVITIES
|
||||||||
Purchases of Investment Securities Available for Sale
|
(74,139
|
)
|
(76,113
|
)
|
||||
Proceeds from Maturities, Calls, and Paydowns of
|
||||||||
Investment Securities:
|
||||||||
Available for Sale
|
29,601
|
22,989
|
||||||
Held for Maturity
|
8
|
7
|
||||||
Proceeds from Sale of Investment Securities
|
||||||||
Available for Sale
|
36,217
|
60,654
|
||||||
Decrease in Interest-Bearing Deposits in Other Banks
|
8,387
|
25,588
|
||||||
Net Loans to Customers
|
(6,107
|
)
|
(8,488
|
)
|
||||
Purchase of Premises and Equipment
|
(896
|
)
|
(553
|
)
|
||||
Proceeds from Sale of Other Real Estate and Repossessions
|
4,902
|
5,697
|
||||||
Proceeds from Sale of Federal Home Loan Bank Stock
|
200
|
1,239
|
||||||
|
(1,827
|
)
|
31,020
|
|||||
CASH FLOWS FROM FINANCING ACTIVITIES
|
||||||||
Noninterest-Bearing Customer Deposits
|
(12,488
|
)
|
9,440
|
|||||
Interest-Bearing Customer Deposits
|
(23,859
|
)
|
(37,290
|
)
|
||||
Principal Payments on Other Borrowed Money
|
(10,500
|
)
|
(36,000
|
)
|
||||
Proceeds from Other Borrowed Money
|
15,500
|
--
|
||||||
|
(31,347
|
)
|
(63,850
|
)
|
||||
|
||||||||
Net Decrease in Cash and Cash Equivalents
|
(22,277
|
)
|
(20,766
|
)
|
||||
Cash and Cash Equivalents at Beginning of Period
|
49,246
|
83,372
|
||||||
Cash and Cash Equivalents at End of Period
|
$
|
26,969
|
$
|
62,606
|
Description
|
Life in Years
|
Method
|
||
Banking Premises
|
15-40
|
Straight-Line and Accelerated
|
||
Furniture and Equipment
|
5-10
|
Straight-Line and Accelerated
|
June 30, 2013
|
Gross
|
Gross
|
||||||||||||||
|
Amortized
|
Unrealized
|
Unrealized
|
Fair
|
||||||||||||
|
Cost
|
Gains
|
Losses
|
Value
|
||||||||||||
Securities Available for Sale:
|
||||||||||||||||
U.S. Government Agencies
|
||||||||||||||||
Mortgage-Backed
|
$
|
269,707
|
$
|
156
|
$
|
(8,070
|
)
|
$
|
261,793
|
|||||||
State, County & Municipal
|
4,158
|
21
|
(58
|
)
|
4,121
|
|||||||||||
Corporate Obligations
|
1,000
|
85
|
--
|
1,085
|
||||||||||||
Asset-Backed Securities
|
367
|
--
|
(235
|
)
|
132
|
|||||||||||
|
$
|
275,232
|
$
|
262
|
$
|
(8,363
|
)
|
$
|
267,131
|
|||||||
Securities Held to Maturity:
|
||||||||||||||||
State, County and Municipal
|
$
|
38
|
$
|
--
|
$
|
--
|
$
|
38
|
December 31, 2012
|
Gross
|
Gross
|
||||||||||||||
|
Amortized
|
Unrealized
|
Unrealized
|
Fair
|
||||||||||||
|
Cost
|
Gains
|
Losses
|
Value
|
||||||||||||
Securities Available for Sale:
|
||||||||||||||||
U.S. Government Agencies
|
||||||||||||||||
Mortgage-Backed
|
$
|
263,187
|
$
|
835
|
$
|
(962
|
)
|
$
|
263,060
|
|||||||
State, County & Municipal
|
3,974
|
34
|
(4
|
)
|
4,004
|
|||||||||||
Corporate Obligations
|
1,000
|
105
|
--
|
1,105
|
||||||||||||
Asset-Backed Securities
|
366
|
--
|
(234
|
)
|
132
|
|||||||||||
|
$
|
268,527
|
$
|
974
|
$
|
(1,200
|
)
|
$
|
268,301
|
|||||||
Securities Held to Maturity:
|
||||||||||||||||
State, County and Municipal
|
$
|
41
|
$
|
1
|
$
|
--
|
$
|
42
|
|
Securities
|
|||||||||||||||
|
Available for Sale
|
Held to Maturity
|
||||||||||||||
|
Amortized Cost
|
Fair Value
|
Amortized Cost
|
Fair Value
|
||||||||||||
|
||||||||||||||||
Due After One Year Through Five Years
|
$
|
2,751
|
$
|
2,855
|
$
|
38
|
$
|
38
|
||||||||
Due After Five Years Through Ten Years
|
1,754
|
1,740
|
--
|
--
|
||||||||||||
Due After Ten Years
|
1,020
|
743
|
--
|
--
|
||||||||||||
|
5,525
|
5,338
|
38
|
38
|
||||||||||||
|
||||||||||||||||
Mortgage-Backed Securities
|
269,707
|
261,793
|
--
|
--
|
||||||||||||
|
$
|
275,232
|
$
|
267,131
|
$
|
38
|
$
|
38
|
|
Less Than 12 Months
|
12 Months or Greater
|
Total
|
|||||||||||||||||||||
|
||||||||||||||||||||||||
|
Gross
|
Gross
|
Gross
|
|||||||||||||||||||||
|
Fair
|
Unrealized
|
Fair
|
Unrealized
|
Fair
|
Unrealized
|
||||||||||||||||||
|
Value
|
Losses
|
Value
|
Losses
|
Value
|
Losses
|
||||||||||||||||||
|
||||||||||||||||||||||||
June 30, 2013
|
||||||||||||||||||||||||
U.S. Government Agencies
|
||||||||||||||||||||||||
Mortgage-Backed
|
$
|
246,778
|
$
|
(8,070
|
)
|
$
|
--
|
$
|
--
|
$
|
246,778
|
$
|
(8,070
|
)
|
||||||||||
State, County and Municipal
|
1,694
|
(58
|
)
|
--
|
--
|
1,694
|
(58
|
)
|
||||||||||||||||
Asset-Backed Securities
|
--
|
--
|
132
|
(235
|
)
|
132
|
(235
|
)
|
||||||||||||||||
|
$
|
248,472
|
$
|
(8,128
|
)
|
$
|
132
|
$
|
(235
|
)
|
$
|
248,604
|
$
|
(8,363
|
)
|
|||||||||
|
||||||||||||||||||||||||
December 31, 2012
|
||||||||||||||||||||||||
U.S. Government Agencies
|
||||||||||||||||||||||||
Mortgage-Backed
|
$
|
142,104
|
$
|
(962
|
)
|
$
|
--
|
$
|
--
|
$
|
142,104
|
$
|
(962
|
)
|
||||||||||
State, County and Municipal
|
1,431
|
(4
|
)
|
--
|
--
|
1,431
|
(4
|
)
|
||||||||||||||||
Asset-Backed Securities
|
--
|
--
|
132
|
(234
|
)
|
132
|
(234
|
)
|
||||||||||||||||
|
$
|
143,535
|
$
|
(966
|
)
|
$
|
132
|
$
|
(234
|
)
|
$
|
143,667
|
$
|
(1,200
|
)
|
|
June 30, 2013
|
December 31, 2012
|
||||||
Commercial and Agricultural
|
||||||||
Commercial
|
$
|
51,158
|
$
|
55,684
|
||||
Agricultural
|
14,177
|
6,211
|
||||||
|
||||||||
Real Estate
|
||||||||
Commercial Construction
|
52,699
|
53,808
|
||||||
Residential Construction
|
8,189
|
5,852
|
||||||
Commercial
|
325,317
|
334,386
|
||||||
Residential
|
208,562
|
203,845
|
||||||
Farmland
|
49,798
|
49,057
|
||||||
|
||||||||
Consumer and Other
|
||||||||
Consumer
|
27,439
|
29,778
|
||||||
Other
|
6,804
|
8,429
|
||||||
|
||||||||
Total Loans
|
$
|
744,143
|
$
|
747,050
|
· | Grades 1 and 2 – Borrowers with these assigned grades range in risk from virtual absence of risk to minimal risk. Such loans may be secured by Company-issued and controlled certificates of deposit or properly margined equity securities or bonds. Other loans comprising these grades are made to companies that have been in existence for a long period of time with many years of consecutive profits and strong equity, good liquidity, excellent debt service ability and unblemished past performance, or to exceptionally strong individuals with collateral of unquestioned value that fully secures the loans. Loans in this category fall into the "pass" classification. |
· | Grades 3 and 4 – Loans assigned these "pass" risk grades are made to borrowers with acceptable credit quality and risk. The risk ranges from loans with no significant weaknesses in repayment capacity and collateral protection to acceptable loans with one or more risk factors considered to be more than average. |
· | Grade 5 – This grade includes "special mention" loans on management's watch list and is intended to be used on a temporary basis for pass grade loans where risk-modifying action is intended in the short-term. |
· | Grade 6 – This grade includes "substandard" loans in accordance with regulatory guidelines. This category includes borrowers with well-defined weaknesses that jeopardize the payment of the debt in accordance with the agreed terms. Loans considered to be impaired are assigned this grade, and these loans often have assigned loss allocations as part of the allowance for loan and lease losses. Generally, loans on which interest accrual has been stopped would be included in this grade. |
· | Grades 7 and 8 – These grades correspond to regulatory classification definitions of "doubtful" and "loss," respectively. In practice, any loan with these grades would be for a very short period of time, and generally the Company has no loans with these assigned grades. Management manages the Company's problem loans in such a way that uncollectible loans or uncollectible portions of loans are charged off immediately with any residual, collectible amounts assigned a risk grade of 6. |
June 30, 2013
|
||||||||||||||||
|
Pass
|
Special Mention
|
Substandard
|
Total Loans
|
||||||||||||
Commercial and Agricultural
|
||||||||||||||||
Commercial
|
$
|
45,294
|
$
|
1,778
|
$
|
4,086
|
$
|
51,158
|
||||||||
Agricultural
|
14,148
|
16
|
13
|
14,177
|
||||||||||||
|
||||||||||||||||
Real Estate
|
||||||||||||||||
Commercial Construction
|
40,316
|
2,128
|
10,255
|
52,699
|
||||||||||||
Residential Construction
|
7,981
|
208
|
--
|
8,189
|
||||||||||||
Commercial
|
301,651
|
10,783
|
12,883
|
325,317
|
||||||||||||
Residential
|
185,643
|
13,184
|
9,735
|
208,562
|
||||||||||||
Farmland
|
45,293
|
711
|
3,794
|
49,798
|
||||||||||||
|
||||||||||||||||
Consumer and Other
|
||||||||||||||||
Consumer
|
26,309
|
385
|
745
|
27,439
|
||||||||||||
Other
|
6,728
|
3
|
73
|
6,804
|
||||||||||||
|
||||||||||||||||
Total Loans
|
$
|
673,363
|
$
|
29,196
|
$
|
41,584
|
$
|
744,143
|
December 31, 2012
|
||||||||||||||||
|
Pass
|
Special Mention
|
Substandard
|
Total Loans
|
||||||||||||
Commercial and Agricultural
|
||||||||||||||||
Commercial
|
$
|
49,947
|
$
|
1,418
|
$
|
4,319
|
$
|
55,684
|
||||||||
Agricultural
|
6,156
|
--
|
55
|
6,211
|
||||||||||||
|
||||||||||||||||
Real Estate
|
||||||||||||||||
Commercial Construction
|
37,256
|
1,664
|
14,888
|
53,808
|
||||||||||||
Residential Construction
|
5,749
|
103
|
--
|
5,852
|
||||||||||||
Commercial
|
298,222
|
9,759
|
26,405
|
334,386
|
||||||||||||
Residential
|
183,222
|
11,413
|
9,210
|
203,845
|
||||||||||||
Farmland
|
45,495
|
914
|
2,648
|
49,057
|
||||||||||||
|
||||||||||||||||
Consumer and Other
|
||||||||||||||||
Consumer
|
28,840
|
293
|
645
|
29,778
|
||||||||||||
Other
|
8,351
|
9
|
69
|
8,429
|
||||||||||||
|
||||||||||||||||
Total Loans
|
$
|
663,238
|
$
|
25,573
|
$
|
58,239
|
$
|
747,050
|
June 30, 2013
|
||||||||||||||||||||||||
|
Accruing Loans
|
|||||||||||||||||||||||
|
90 Days
|
|||||||||||||||||||||||
|
30-89 Days
|
or More
|
Total Accruing
|
Nonaccrual
|
||||||||||||||||||||
|
Past Due
|
Past Due
|
Loans Past Due
|
Loans
|
Current Loans
|
Total Loans
|
||||||||||||||||||
Commercial and Agricultural
|
||||||||||||||||||||||||
Commercial
|
$
|
691
|
$
|
--
|
$
|
691
|
$
|
2,432
|
$
|
48,035
|
$
|
51,158
|
||||||||||||
Agricultural
|
--
|
--
|
--
|
--
|
14,177
|
14,177
|
||||||||||||||||||
|
||||||||||||||||||||||||
Real Estate
|
||||||||||||||||||||||||
Commercial Construction
|
494
|
--
|
494
|
10,166
|
42,039
|
52,699
|
||||||||||||||||||
Residential Construction
|
--
|
--
|
--
|
--
|
8,189
|
8,189
|
||||||||||||||||||
Commercial
|
2,244
|
--
|
2,244
|
5,234
|
317,839
|
325,317
|
||||||||||||||||||
Residential
|
3,651
|
--
|
3,651
|
4,340
|
200,571
|
208,562
|
||||||||||||||||||
Farmland
|
349
|
--
|
349
|
2,307
|
47,142
|
49,798
|
||||||||||||||||||
|
||||||||||||||||||||||||
Consumer and Other
|
||||||||||||||||||||||||
Consumer
|
483
|
--
|
483
|
206
|
26,750
|
27,439
|
||||||||||||||||||
Other
|
--
|
--
|
--
|
--
|
6,804
|
6,804
|
||||||||||||||||||
|
||||||||||||||||||||||||
Total Loans
|
$
|
7,912
|
$
|
--
|
$
|
7,912
|
$
|
24,685
|
$
|
711,546
|
$
|
744,143
|
December 31, 2012
|
||||||||||||||||||||||||
|
Accruing Loans
|
|||||||||||||||||||||||
|
90 Days
|
|||||||||||||||||||||||
|
30-89 Days
|
or More
|
Total Accruing
|
Nonaccrual
|
||||||||||||||||||||
|
Past Due
|
Past Due
|
Loans Past Due
|
Loans
|
Current Loans
|
Total Loans
|
||||||||||||||||||
Commercial and Agricultural
|
||||||||||||||||||||||||
Commercial
|
$
|
798
|
$
|
--
|
$
|
798
|
$
|
1,033
|
$
|
53,853
|
$
|
55,684
|
||||||||||||
Agricultural
|
28
|
--
|
28
|
39
|
6,144
|
6,211
|
||||||||||||||||||
|
||||||||||||||||||||||||
Real Estate
|
||||||||||||||||||||||||
Commercial Construction
|
1,310
|
--
|
1,310
|
14,032
|
38,466
|
53,808
|
||||||||||||||||||
Residential Construction
|
--
|
--
|
--
|
--
|
5,852
|
5,852
|
||||||||||||||||||
Commercial
|
3,771
|
--
|
3,771
|
6,630
|
323,985
|
334,386
|
||||||||||||||||||
Residential
|
8,223
|
--
|
8,223
|
5,430
|
190,192
|
203,845
|
||||||||||||||||||
Farmland
|
140
|
--
|
140
|
2,413
|
46,504
|
49,057
|
||||||||||||||||||
|
||||||||||||||||||||||||
Consumer and Other
|
||||||||||||||||||||||||
Consumer
|
637
|
4
|
641
|
256
|
28,881
|
29,778
|
||||||||||||||||||
Other
|
5
|
--
|
5
|
18
|
8,406
|
8,429
|
||||||||||||||||||
|
||||||||||||||||||||||||
Total Loans
|
$
|
14,912
|
$
|
4
|
$
|
14,916
|
$
|
29,851
|
$
|
702,283
|
$
|
747,050
|
June 30, 2013
|
||||||||||||||||||||||||
|
Unpaid
|
|||||||||||||||||||||||
|
Contractual
|
Average
|
Interest
|
Interest
|
||||||||||||||||||||
|
Principal
|
Impaired
|
Related
|
Recorded
|
Income
|
Income
|
||||||||||||||||||
|
Balance
|
Balance
|
Allowance
|
Investment
|
Recognized
|
Collected
|
||||||||||||||||||
|
||||||||||||||||||||||||
With No Related Allowance Recorded
|
||||||||||||||||||||||||
Commercial
|
$
|
174
|
$
|
172
|
$
|
--
|
$
|
147
|
$
|
4
|
$
|
6
|
||||||||||||
Agricultural
|
--
|
--
|
--
|
20
|
--
|
--
|
||||||||||||||||||
Commercial Construction
|
3,969
|
1,699
|
--
|
3,330
|
12
|
12
|
||||||||||||||||||
Residential Construction
|
--
|
--
|
--
|
--
|
--
|
--
|
||||||||||||||||||
Commercial Real Estate
|
10,879
|
10,148
|
--
|
12,740
|
112
|
133
|
||||||||||||||||||
Residential Real Estate
|
4,327
|
3,685
|
--
|
3,033
|
62
|
67
|
||||||||||||||||||
Farmland
|
2,307
|
2,307
|
--
|
2,427
|
1
|
1
|
||||||||||||||||||
Consumer
|
217
|
206
|
--
|
212
|
4
|
6
|
||||||||||||||||||
Other
|
--
|
--
|
--
|
--
|
--
|
--
|
||||||||||||||||||
|
||||||||||||||||||||||||
|
21,873
|
18,217
|
--
|
21,909
|
195
|
225
|
||||||||||||||||||
|
||||||||||||||||||||||||
With An Allowance Recorded
|
||||||||||||||||||||||||
Commercial
|
2,374
|
2,374
|
551
|
1,919
|
22
|
30
|
||||||||||||||||||
Agricultural
|
--
|
--
|
--
|
--
|
--
|
--
|
||||||||||||||||||
Commercial Construction
|
11,017
|
8,467
|
1,580
|
6,578
|
6
|
9
|
||||||||||||||||||
Residential Construction
|
--
|
--
|
--
|
--
|
--
|
--
|
||||||||||||||||||
Commercial Real Estate
|
13,436
|
13,436
|
1,080
|
11,677
|
240
|
234
|
||||||||||||||||||
Residential Real Estate
|
4,791
|
4,078
|
982
|
4,997
|
40
|
37
|
||||||||||||||||||
Farmland
|
--
|
--
|
--
|
--
|
--
|
--
|
||||||||||||||||||
Consumer
|
--
|
--
|
--
|
--
|
--
|
--
|
||||||||||||||||||
Other
|
--
|
--
|
--
|
--
|
--
|
--
|
||||||||||||||||||
|
||||||||||||||||||||||||
|
31,618
|
28,355
|
4,193
|
25,171
|
308
|
310
|
||||||||||||||||||
|
||||||||||||||||||||||||
Total
|
||||||||||||||||||||||||
Commercial
|
2,548
|
2,546
|
551
|
2,066
|
26
|
36
|
||||||||||||||||||
Agricultural
|
--
|
--
|
--
|
20
|
--
|
--
|
||||||||||||||||||
Commercial Construction
|
14,986
|
10,166
|
1,580
|
9,908
|
18
|
21
|
||||||||||||||||||
Residential Construction
|
--
|
--
|
--
|
--
|
--
|
--
|
||||||||||||||||||
Commercial Real Estate
|
24,315
|
23,584
|
1,080
|
24,417
|
352
|
367
|
||||||||||||||||||
Residential Real Estate
|
9,118
|
7,763
|
982
|
8,030
|
102
|
104
|
||||||||||||||||||
Farmland
|
2,307
|
2,307
|
--
|
2,427
|
1
|
1
|
||||||||||||||||||
Consumer
|
217
|
206
|
--
|
212
|
4
|
6
|
||||||||||||||||||
Other
|
--
|
--
|
--
|
--
|
--
|
--
|
||||||||||||||||||
|
||||||||||||||||||||||||
|
$
|
53,491
|
$
|
46,572
|
$
|
4,193
|
$
|
47,080
|
$
|
503
|
$
|
535
|
December 31, 2012
|
||||||||||||||||||||||||
|
Unpaid
|
|||||||||||||||||||||||
|
Contractual
|
Average
|
Interest
|
Interest
|
||||||||||||||||||||
|
Principal
|
Impaired
|
Related
|
Recorded
|
Income
|
Income
|
||||||||||||||||||
|
Balance
|
Balance
|
Allowance
|
Investment
|
Recognized
|
Collected
|
||||||||||||||||||
|
||||||||||||||||||||||||
With No Related Allowance Recorded
|
||||||||||||||||||||||||
Commercial
|
$
|
1,508
|
$
|
1,042
|
$
|
--
|
$
|
1,053
|
$
|
27
|
$
|
28
|
||||||||||||
Agricultural
|
39
|
39
|
--
|
58
|
--
|
--
|
||||||||||||||||||
Commercial Construction
|
10,625
|
6,415
|
--
|
9,194
|
27
|
52
|
||||||||||||||||||
Residential Construction
|
--
|
--
|
--
|
--
|
--
|
--
|
||||||||||||||||||
Commercial Real Estate
|
16,566
|
15,506
|
--
|
26,482
|
430
|
421
|
||||||||||||||||||
Residential Real Estate
|
4,450
|
4,132
|
--
|
3,096
|
89
|
123
|
||||||||||||||||||
Farmland
|
2,829
|
2,413
|
--
|
2,326
|
43
|
55
|
||||||||||||||||||
Consumer
|
297
|
255
|
--
|
228
|
10
|
13
|
||||||||||||||||||
Other
|
18
|
18
|
--
|
24
|
1
|
1
|
||||||||||||||||||
|
||||||||||||||||||||||||
|
36,332
|
29,820
|
--
|
42,461
|
627
|
693
|
||||||||||||||||||
|
||||||||||||||||||||||||
With An Allowance Recorded
|
||||||||||||||||||||||||
Commercial
|
1,493
|
1,493
|
463
|
943
|
92
|
88
|
||||||||||||||||||
Agricultural
|
--
|
--
|
--
|
--
|
--
|
--
|
||||||||||||||||||
Commercial Construction
|
8,267
|
7,618
|
1,733
|
10,534
|
--
|
--
|
||||||||||||||||||
Residential Construction
|
--
|
--
|
--
|
--
|
--
|
--
|
||||||||||||||||||
Commercial Real Estate
|
12,759
|
12,745
|
1,236
|
6,399
|
384
|
366
|
||||||||||||||||||
Residential Real Estate
|
5,515
|
4,422
|
840
|
4,288
|
145
|
117
|
||||||||||||||||||
Farmland
|
--
|
--
|
--
|
65
|
--
|
--
|
||||||||||||||||||
Consumer
|
--
|
--
|
--
|
--
|
--
|
--
|
||||||||||||||||||
Other
|
--
|
--
|
--
|
--
|
--
|
--
|
||||||||||||||||||
|
||||||||||||||||||||||||
|
28,034
|
26,278
|
4,272
|
22,229
|
621
|
571
|
||||||||||||||||||
|
||||||||||||||||||||||||
Total
|
||||||||||||||||||||||||
Commercial
|
3,001
|
2,535
|
463
|
1,996
|
119
|
116
|
||||||||||||||||||
Agricultural
|
39
|
39
|
--
|
58
|
--
|
--
|
||||||||||||||||||
Commercial Construction
|
18,892
|
14,033
|
1,733
|
19,728
|
27
|
52
|
||||||||||||||||||
Residential Construction
|
--
|
--
|
--
|
--
|
--
|
--
|
||||||||||||||||||
Commercial Real Estate
|
29,325
|
28,251
|
1,236
|
32,881
|
814
|
787
|
||||||||||||||||||
Residential Real Estate
|
9,965
|
8,554
|
840
|
7,384
|
234
|
240
|
||||||||||||||||||
Farmland
|
2,829
|
2,413
|
--
|
2,391
|
43
|
55
|
||||||||||||||||||
Consumer
|
297
|
255
|
--
|
228
|
10
|
13
|
||||||||||||||||||
Other
|
18
|
18
|
--
|
24
|
1
|
1
|
||||||||||||||||||
|
||||||||||||||||||||||||
|
$
|
64,366
|
$
|
56,098
|
$
|
4,272
|
$
|
64,690
|
$
|
1,248
|
$
|
1,264
|
June 30, 2012
|
||||||||||||||||||||||||
|
Unpaid
|
|||||||||||||||||||||||
|
Contractual
|
Average
|
Interest
|
Interest
|
||||||||||||||||||||
|
Principal
|
Impaired
|
Related
|
Recorded
|
Income
|
Income
|
||||||||||||||||||
|
Balance
|
Balance
|
Allowance
|
Investment
|
Recognized
|
Collected
|
||||||||||||||||||
|
||||||||||||||||||||||||
With No Related Allowance Recorded
|
||||||||||||||||||||||||
Commercial
|
$
|
1,546
|
$
|
1,456
|
$
|
--
|
$
|
1,568
|
$
|
49
|
$
|
40
|
||||||||||||
Agricultural
|
45
|
45
|
--
|
42
|
--
|
--
|
||||||||||||||||||
Commercial Construction
|
11,998
|
9,694
|
--
|
11,079
|
(7
|
)
|
4
|
|||||||||||||||||
Residential Construction
|
--
|
--
|
--
|
--
|
--
|
--
|
||||||||||||||||||
Commercial Real Estate
|
33,857
|
28,254
|
--
|
30,136
|
358
|
325
|
||||||||||||||||||
Residential Real Estate
|
2,748
|
2,152
|
--
|
2,280
|
46
|
42
|
||||||||||||||||||
Farmland
|
2,340
|
2,297
|
--
|
2,297
|
32
|
44
|
||||||||||||||||||
Consumer
|
256
|
237
|
--
|
225
|
3
|
5
|
||||||||||||||||||
Other
|
38
|
36
|
--
|
40
|
--
|
--
|
||||||||||||||||||
|
||||||||||||||||||||||||
|
52,828
|
44,171
|
--
|
47,667
|
481
|
460
|
||||||||||||||||||
|
||||||||||||||||||||||||
With An Allowance Recorded
|
||||||||||||||||||||||||
Commercial
|
290
|
290
|
300
|
300
|
2
|
5
|
||||||||||||||||||
Agricultural
|
--
|
--
|
--
|
--
|
--
|
--
|
||||||||||||||||||
Commercial Construction
|
17,961
|
12,966
|
2,111
|
11,954
|
--
|
--
|
||||||||||||||||||
Residential Construction
|
--
|
--
|
--
|
--
|
--
|
--
|
||||||||||||||||||
Commercial Real Estate
|
5,163
|
5,141
|
1,462
|
4,394
|
55
|
53
|
||||||||||||||||||
Residential Real Estate
|
4,852
|
4,139
|
868
|
4,092
|
46
|
45
|
||||||||||||||||||
Farmland
|
--
|
--
|
--
|
130
|
--
|
--
|
||||||||||||||||||
Consumer
|
--
|
--
|
--
|
--
|
--
|
--
|
||||||||||||||||||
Other
|
--
|
--
|
--
|
--
|
--
|
--
|
||||||||||||||||||
|
||||||||||||||||||||||||
|
28,266
|
22,536
|
4,741
|
20,870
|
103
|
103
|
||||||||||||||||||
|
||||||||||||||||||||||||
Total
|
||||||||||||||||||||||||
Commercial
|
1,836
|
1,746
|
300
|
1,868
|
51
|
45
|
||||||||||||||||||
Agricultural
|
45
|
45
|
--
|
42
|
--
|
--
|
||||||||||||||||||
Commercial Construction
|
29,959
|
22,660
|
2,111
|
23,033
|
(7
|
)
|
4
|
|||||||||||||||||
Residential Construction
|
--
|
--
|
--
|
--
|
--
|
--
|
||||||||||||||||||
Commercial Real Estate
|
39,020
|
33,395
|
1,462
|
34,530
|
413
|
378
|
||||||||||||||||||
Residential Real Estate
|
7,600
|
6,291
|
868
|
6,372
|
92
|
87
|
||||||||||||||||||
Farmland
|
2,340
|
2,297
|
--
|
2,427
|
32
|
44
|
||||||||||||||||||
Consumer
|
256
|
237
|
--
|
225
|
3
|
5
|
||||||||||||||||||
Other
|
38
|
36
|
--
|
40
|
--
|
--
|
||||||||||||||||||
|
||||||||||||||||||||||||
|
$
|
81,094
|
$
|
66,707
|
$
|
4,741
|
$
|
68,537
|
$
|
584
|
$
|
563
|
· | Interest rate reductions – Occur when the stated interest rate is reduced to a nonmarket rate or a rate the borrower would not be able to obtain elsewhere under similar circumstances. |
· | Amortization or maturity date changes – Result when the amortization period of the loan is extended beyond what is considered a normal amortization period for loans of similar type with similar collateral. |
· | Principal reductions – These are often the result of commercial real estate loan workouts where two new notes are created. The primary note is underwritten based upon our normal underwriting standards and is structured so that the projected cash flows are sufficient to repay the contractual principal and interest of the newly restructured note. The terms of the secondary note vary by situation and often involve that note being charged-off, or the principal and interest payments being deferred until after the primary note has been repaid. In situations where a portion of the note is charged-off during modification there is often no specific reserve allocated to those loans. This is due to the fact that the amount of the charge-off usually represents the excess of the original loan balance over the collateral value and the Company has determined there is no additional exposure on those loans. |
|
Three Months Ending June 30, 2013
|
Six Months Ending June 30, 2013
|
||||||||||||||||||||||
Troubled Debt Restructurings
|
||||||||||||||||||||||||
|
# of Contracts
|
Pre-Modification
|
Post-Modification
|
# of Contracts
|
Pre-Modification
|
Post-Modification
|
||||||||||||||||||
|
||||||||||||||||||||||||
Commercial
|
--
|
$
|
--
|
$
|
--
|
1
|
$
|
84
|
$
|
81
|
||||||||||||||
Commercial Construction
|
2
|
229
|
226
|
2
|
229
|
226
|
||||||||||||||||||
Commercial RE
|
1
|
226
|
226
|
1
|
226
|
226
|
||||||||||||||||||
Residential RE
|
--
|
--
|
--
|
2
|
1,024
|
1,001
|
||||||||||||||||||
|
||||||||||||||||||||||||
Total Loans
|
3
|
$
|
455
|
$
|
452
|
6
|
$
|
1,563
|
$
|
1,534
|
|
Three Months Ending June 30, 2013
|
Six Months Ending June 30, 2013
|
||||||||||||||
Troubled Debt Restructurings
|
||||||||||||||||
That Subsequently Defaulted
|
||||||||||||||||
|
# of Contracts
|
Recorded Investment
|
# of Contracts
|
Recorded Investment
|
||||||||||||
|
||||||||||||||||
Commercial Construction
|
----
|
$
|
----
|
----
|
$
|
----
|
||||||||||
Residential RE
|
----
|
----
|
----
|
----
|
||||||||||||
|
||||||||||||||||
Total Loans
|
----
|
$
|
----
|
----
|
$
|
----
|
|
Three Months Ending June 30, 2012
|
Six Months Ending June 30, 2012
|
||||||||||||||||||||||
Troubled Debt Restructurings
|
||||||||||||||||||||||||
|
# of Contracts
|
Pre-Modification
|
Post-Modification
|
# of Contracts
|
Pre-Modification
|
Post-Modification
|
||||||||||||||||||
|
||||||||||||||||||||||||
Commercial RE
|
----
|
$
|
----
|
$
|
----
|
1
|
$
|
57
|
$
|
57
|
||||||||||||||
Residential RE
|
----
|
----
|
----
|
1
|
227
|
224
|
||||||||||||||||||
|
||||||||||||||||||||||||
Total Loans
|
----
|
$
|
----
|
$
|
----
|
2
|
$
|
284
|
$
|
281
|
|
Three Months Ending June 30, 2012
|
Six Months Ending June 30, 2012
|
||||||||||||||
Troubled Debt Restructurings
|
||||||||||||||||
That Subsequently Defaulted
|
||||||||||||||||
|
# of Contracts
|
Recorded Investment
|
# of Contracts
|
Recorded Investment
|
||||||||||||
|
||||||||||||||||
Commercial Construction
|
----
|
$
|
----
|
1
|
$
|
64
|
||||||||||
Residential RE
|
----
|
----
|
1
|
50
|
||||||||||||
|
||||||||||||||||
Total Loans
|
----
|
$
|
----
|
2
|
$
|
114
|
June 30, 2013
|
||||||||||||||||||||
|
Beginning
|
Ending
|
||||||||||||||||||
|
Balance
|
Charge-Offs
|
Recoveries
|
Provision
|
Balance
|
|||||||||||||||
|
||||||||||||||||||||
Commercial and Agricultural
|
||||||||||||||||||||
Commercial
|
$
|
981
|
$
|
(45
|
)
|
$
|
38
|
$
|
43
|
$
|
1,017
|
|||||||||
Agricultural
|
296
|
(27
|
)
|
4
|
26
|
299
|
||||||||||||||
|
||||||||||||||||||||
Real Estate
|
||||||||||||||||||||
Commercial Construction
|
1,890
|
(791
|
)
|
120
|
756
|
1,975
|
||||||||||||||
Residential Construction
|
138
|
--
|
--
|
--
|
138
|
|||||||||||||||
Commercial
|
5,163
|
(1,425
|
)
|
85
|
1,361
|
5,184
|
||||||||||||||
Residential
|
3,406
|
(279
|
)
|
18
|
267
|
3,412
|
||||||||||||||
Farmland
|
291
|
(21
|
)
|
16
|
20
|
306
|
||||||||||||||
|
||||||||||||||||||||
Consumer and Other
|
||||||||||||||||||||
Consumer
|
228
|
(233
|
)
|
55
|
223
|
273
|
||||||||||||||
Other
|
344
|
(4
|
)
|
9
|
4
|
353
|
||||||||||||||
|
||||||||||||||||||||
|
$
|
12,737
|
$
|
(2,825
|
)
|
$
|
345
|
$
|
2,700
|
$
|
12,957
|
June 30, 2012
|
||||||||||||||||||||
|
Beginning
|
Ending
|
||||||||||||||||||
|
Balance
|
Charge-Offs
|
Recoveries
|
Provision
|
Balance
|
|||||||||||||||
|
||||||||||||||||||||
Commercial and Agricultural
|
||||||||||||||||||||
Commercial
|
$
|
1,071
|
$
|
(230
|
)
|
$
|
96
|
$
|
105
|
$
|
1,042
|
|||||||||
Agricultural
|
297
|
--
|
--
|
--
|
297
|
|||||||||||||||
|
||||||||||||||||||||
Real Estate
|
||||||||||||||||||||
Commercial Construction
|
3,123
|
(474
|
)
|
35
|
578
|
3,262
|
||||||||||||||
Residential Construction
|
138
|
--
|
--
|
--
|
138
|
|||||||||||||||
Commercial
|
6,448
|
(3,397
|
)
|
18
|
2,876
|
5,945
|
||||||||||||||
Residential
|
3,695
|
(275
|
)
|
5
|
285
|
3,710
|
||||||||||||||
Farmland
|
365
|
(39
|
)
|
5
|
--
|
331
|
||||||||||||||
|
||||||||||||||||||||
Consumer and Other
|
||||||||||||||||||||
Consumer
|
205
|
(41
|
)
|
48
|
41
|
253
|
||||||||||||||
Other
|
308
|
--
|
7
|
--
|
315
|
|||||||||||||||
|
||||||||||||||||||||
|
$
|
15,650
|
$
|
(4,456
|
)
|
$
|
214
|
$
|
3,885
|
$
|
15,293
|
June 30, 2013
|
||||||||||||||||||||||||
|
Ending Allowance Balance
|
Ending Loan Balance
|
||||||||||||||||||||||
|
||||||||||||||||||||||||
|
Individually
|
Collectively
|
Individually
|
Collectively
|
||||||||||||||||||||
|
Evaluated for
|
Evaluated for
|
Evaluated for
|
Evaluated for
|
||||||||||||||||||||
|
Impairment
|
Impairment
|
Total
|
Impairment
|
Impairment
|
Total
|
||||||||||||||||||
Commercial and Agricultural
|
||||||||||||||||||||||||
Commercial
|
$
|
551
|
$
|
466
|
$
|
1,017
|
$
|
2,388
|
$
|
48,770
|
$
|
51,158
|
||||||||||||
Agricultural
|
--
|
299
|
299
|
--
|
14,177
|
14,177
|
||||||||||||||||||
|
||||||||||||||||||||||||
Real Estate
|
||||||||||||||||||||||||
Commercial Construction
|
1,580
|
395
|
1,975
|
10,007
|
42,692
|
52,699
|
||||||||||||||||||
Residential Construction
|
--
|
138
|
138
|
--
|
8,189
|
8,189
|
||||||||||||||||||
Commercial
|
1,080
|
4,104
|
5,184
|
23,144
|
302,173
|
325,317
|
||||||||||||||||||
Residential
|
982
|
2,430
|
3,412
|
6,591
|
201,971
|
208,562
|
||||||||||||||||||
Farmland
|
--
|
306
|
306
|
2,277
|
47,521
|
49,798
|
||||||||||||||||||
|
||||||||||||||||||||||||
Consumer and Other
|
||||||||||||||||||||||||
Consumer
|
--
|
273
|
273
|
--
|
27,439
|
27,439
|
||||||||||||||||||
Other
|
--
|
353
|
353
|
--
|
6,804
|
6,804
|
||||||||||||||||||
|
||||||||||||||||||||||||
Total End of Period Balance
|
$
|
4,193
|
$
|
8,764
|
$
|
12,957
|
$
|
44,407
|
$
|
699,736
|
$
|
744,143
|
June 30, 2012
|
||||||||||||||||||||||||
|
Ending Allowance Balance
|
Ending Loan Balance
|
||||||||||||||||||||||
|
||||||||||||||||||||||||
|
Individually
|
Collectively
|
Individually
|
Collectively
|
||||||||||||||||||||
|
Evaluated for
|
Evaluated for
|
Evaluated for
|
Evaluated for
|
||||||||||||||||||||
|
Impairment
|
Impairment
|
Total
|
Impairment
|
Impairment
|
Total
|
||||||||||||||||||
Commercial and Agricultural
|
||||||||||||||||||||||||
Commercial
|
$
|
300
|
$
|
742
|
$
|
1,042
|
$
|
1,721
|
$
|
53,553
|
$
|
55,274
|
||||||||||||
Agricultural
|
--
|
297
|
297
|
--
|
11,284
|
11,284
|
||||||||||||||||||
|
||||||||||||||||||||||||
Real Estate
|
||||||||||||||||||||||||
Commercial Construction
|
2,111
|
1,151
|
3,262
|
22,595
|
33,773
|
56,368
|
||||||||||||||||||
Residential Construction
|
--
|
138
|
138
|
--
|
4,169
|
4,169
|
||||||||||||||||||
Commercial
|
1,462
|
4,483
|
5,945
|
33,395
|
275,541
|
308,936
|
||||||||||||||||||
Residential
|
868
|
2,842
|
3,710
|
5,951
|
187,239
|
193,190
|
||||||||||||||||||
Farmland
|
--
|
331
|
331
|
2,277
|
46,471
|
48,748
|
||||||||||||||||||
|
||||||||||||||||||||||||
Consumer and Other
|
||||||||||||||||||||||||
Consumer
|
--
|
253
|
253
|
20
|
29,632
|
29,652
|
||||||||||||||||||
Other
|
--
|
315
|
315
|
--
|
8,740
|
8,740
|
||||||||||||||||||
|
||||||||||||||||||||||||
Total End of Period Balance
|
$
|
4,741
|
$
|
10,552
|
$
|
15,293
|
$
|
65,959
|
$
|
650,402
|
$
|
716,361
|
|
Six Months Ended
|
Twelve Months Ended
|
||||||
|
June 30, 2013
|
December 31, 2012
|
||||||
|
||||||||
Balance, Beginning
|
$
|
15,941
|
$
|
20,445
|
||||
|
||||||||
Additions
|
6,339
|
9,729
|
||||||
Sales of OREO
|
(4,720
|
)
|
(9,712
|
)
|
||||
Gain (Loss) on Sale
|
(540
|
)
|
(1,819
|
)
|
||||
Provision for Losses
|
(892
|
)
|
(2,702
|
)
|
||||
|
||||||||
Balance, Ending
|
$
|
16,128
|
$
|
15,941
|
|
June 30, 2013
|
December 31, 2012
|
||||||
Interest-Bearing Demand
|
$
|
305,935
|
$
|
314,031
|
||||
Savings
|
54,026
|
48,777
|
||||||
Time, $100,000 and Over
|
222,749
|
211,245
|
||||||
Other Time
|
249,149
|
281,665
|
||||||
|
$
|
831,859
|
$
|
855,718
|
Maturity
|
June 30, 2013
|
December 31, 2012
|
||||||
One Year and Under
|
$
|
342,295
|
$
|
388,484
|
||||
One to Three Years
|
102,588
|
87,464
|
||||||
Three Years and Over
|
27,015
|
16,962
|
||||||
|
$
|
471,898
|
$
|
492,910
|
|
June 30, 2013
|
December 31, 2012
|
||||||
Federal Home Loan Bank Advances
|
$
|
40,000
|
$
|
35,000
|
|
||||
Year
|
Amount
|
|||
2017
|
$
|
9,000
|
||
2018 and Thereafter
|
31,000
|
|||
|
$
|
40,000
|
|
|
3 month
|
Added
|
Total
|
|
5 Year
|
|||||||||||||||
Description
|
Date
|
Amount
|
Libor Rate
|
Points
|
Rate
|
Maturity
|
Call Option
|
||||||||||||||
Colony Bankcorp Statutory Trust III
|
6/17/2004
|
4,500
|
0.27325
|
2.68
|
2.95325
|
6/14/2034
|
6/17/2009
|
||||||||||||||
Colony Bankcorp Capital Trust I
|
4/13/2006
|
5,000
|
0.27400
|
1.50
|
1.77400
|
4/13/2036
|
4/13/2011
|
||||||||||||||
Colony Bankcorp Capital Trust II
|
3/12/2007
|
9,000
|
0.27400
|
1.65
|
1.92400
|
3/12/2037
|
3/12/2012
|
||||||||||||||
Colony Bankcorp Capital Trust III
|
9/14/2007
|
5,000
|
0.27560
|
1.40
|
1.67560
|
9/14/2037
|
9/14/2012
|
|
Contract Amount
|
|||||||
|
June 30, 2013
|
December 31, 2012
|
||||||
|
||||||||
Loan Commitments
|
$
|
63,570
|
$
|
64,147
|
||||
Letters of Credit
|
1,000
|
1,141
|
|
Fair Value Measurements at
|
|||||||||||||||||||
|
June 30, 2013
|
|||||||||||||||||||
|
Carrying
|
Estimated
|
Level
|
Level
|
Level
|
|||||||||||||||
|
Value
|
Fair Value
|
1 | 2 | 3 | |||||||||||||||
|
||||||||||||||||||||
Assets
|
||||||||||||||||||||
Cash and Short-Term Investments
|
$
|
40,377
|
$
|
40,377
|
$
|
40,377
|
$
|
---
|
$
|
---
|
||||||||||
Investment Securities Available for Sale
|
267,131
|
267,131
|
---
|
266,002
|
1,129
|
|||||||||||||||
Investment Securities Held to Maturity
|
38
|
38
|
---
|
38
|
---
|
|||||||||||||||
Federal Home Loan Bank Stock
|
3,164
|
3,164
|
3,164
|
---
|
---
|
|||||||||||||||
Loans, Net
|
730,920
|
730,084
|
---
|
705,922
|
24,162
|
|||||||||||||||
|
||||||||||||||||||||
Liabilities
|
||||||||||||||||||||
Deposits
|
943,337
|
944,685
|
471,439
|
473,246
|
---
|
|||||||||||||||
Subordinated Debentures
|
24,229
|
24,229
|
24,229
|
---
|
---
|
|||||||||||||||
Other Borrowed Money
|
40,000
|
41,450
|
---
|
41,450
|
---
|
|
Fair Value Measurements at
|
|||||||||||||||||||
|
December 31, 2012
|
|||||||||||||||||||
|
Carrying
|
Estimated
|
Level
|
Level
|
Level
|
|||||||||||||||
|
Value
|
Fair Value
|
1 | 2 | 3 | |||||||||||||||
|
||||||||||||||||||||
Assets
|
||||||||||||||||||||
Cash and Short-Term Investments
|
$
|
71,041
|
$
|
71,041
|
$
|
71,041
|
$
|
---
|
$
|
---
|
||||||||||
Investment Securities Available for Sale
|
268,301
|
268,301
|
---
|
267,163
|
1,138
|
|||||||||||||||
Investment Securities Held to Maturity
|
41
|
42
|
---
|
42
|
---
|
|||||||||||||||
Federal Home Loan Bank Stock
|
3,364
|
3,364
|
3,364
|
---
|
---
|
|||||||||||||||
Loans, Net
|
734,079
|
735,115
|
---
|
713,109
|
22,006
|
|||||||||||||||
|
||||||||||||||||||||
Liabilities
|
||||||||||||||||||||
Deposits
|
979,685
|
982,215
|
486,775
|
495,440
|
---
|
|||||||||||||||
Subordinated Debentures
|
24,229
|
24,229
|
24,229
|
---
|
---
|
|||||||||||||||
Other Borrowed Money
|
35,000
|
38,424
|
---
|
38,424
|
---
|
·
|
Level 1
|
inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets.
|
|
|
|
·
|
Level 2
|
inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument.
|
|
|
|
·
|
Level 3
|
inputs to the valuation methodology are unobservable and represent the Company's own assumptions about the assumptions that market participants would use in pricing the assets or liabilities.
|
|
Fair Value Measurements at Reporting Date Using
|
|||||||||||||||
|
Quoted Prices in
|
Significant
|
||||||||||||||
|
Active Markets for
|
Significant Other
|
Unobservable
|
|||||||||||||
|
Total Fair
|
Identical Assets
|
Observable
|
Inputs
|
||||||||||||
June 30, 2013
|
Value
|
(Level 1)
|
Inputs (Level 2)
|
(Level 3)
|
||||||||||||
|
||||||||||||||||
Recurring Securities Available for Sale
|
||||||||||||||||
U.S. Government Agencies
|
||||||||||||||||
Mortgage-Backed
|
$
|
261,793
|
$
|
---
|
$
|
261,793
|
$
|
---
|
||||||||
State, County and Municipal
|
4,121
|
---
|
3,124
|
997
|
||||||||||||
Corporate Obligations
|
1,085
|
---
|
1,085
|
---
|
||||||||||||
Asset-Backed Securities
|
132
|
---
|
---
|
132
|
||||||||||||
|
$
|
267,131
|
$
|
---
|
$
|
266,002
|
$
|
1,129
|
||||||||
|
||||||||||||||||
Nonrecurring
|
||||||||||||||||
Impaired Loans
|
$
|
24,162
|
$
|
---
|
$
|
---
|
$
|
24,162
|
||||||||
|
||||||||||||||||
Other Real Estate
|
$
|
8,102
|
$
|
---
|
$
|
---
|
$
|
8,102
|
|
Fair Value Measurements at Reporting Date Using
|
|||||||||||||||
|
Quoted Prices in
|
Significant
|
||||||||||||||
|
Active Markets for
|
Significant Other
|
Unobservable
|
|||||||||||||
|
Total Fair
|
Identical Assets
|
Observable
|
Inputs
|
||||||||||||
December 31, 2012
|
Value
|
(Level 1)
|
Inputs (Level 2)
|
(Level 3)
|
||||||||||||
|
||||||||||||||||
Recurring Securities Available for Sale
|
||||||||||||||||
U.S. Government Agencies
|
||||||||||||||||
Mortgage-Backed
|
$
|
263,060
|
$
|
---
|
$
|
263,060
|
$
|
---
|
||||||||
State, County and Municipal
|
4,004
|
---
|
2,998
|
1,006
|
||||||||||||
Corporate Obligations
|
1,105
|
---
|
1,105
|
---
|
||||||||||||
Asset-Backed Securities
|
132
|
---
|
---
|
132
|
||||||||||||
|
$
|
268,301
|
$
|
---
|
$
|
267,163
|
$
|
1,138
|
||||||||
|
||||||||||||||||
Nonrecurring
|
||||||||||||||||
Impaired Loans
|
$
|
22,006
|
$
|
---
|
$
|
---
|
$
|
22,006
|
||||||||
|
||||||||||||||||
Other Real Estate
|
$
|
8,817
|
$
|
---
|
$
|
---
|
$
|
8,817
|
|
Valuation
|
Unobservable
|
Range
|
||||||
|
June 30, 2013
|
Techniques
|
Inputs
|
Weighted Avg
|
|||||
|
|
|
|||||||
Impaired Loans
|
|
|
|||||||
Commercial
|
$
|
1,823
|
Sales Comparison
|
Adjustment for Differences
|
0.00% - 0.00%
|
||||
|
|
Between the Comparable Sales
|
0.00%
|
||||||
|
|
|
|||||||
|
|
Management Adjustments for
|
0.00% - 90.00%
|
||||||
|
|
Age of Appraisals and/or Current
|
45.00%
|
||||||
|
|
Market Conditions
|
|||||||
|
|
|
|||||||
Real Estate
|
|
|
|||||||
Commercial Construction
|
6,887
|
Sales Comparison
|
Adjustment for Differences
|
(80.00%) - 450.00%
|
|||||
|
|
Between the Comparable Sales
|
185.00%
|
||||||
|
|
|
|||||||
|
|
Management Adjustments for
|
0.00% - 25.00%
|
||||||
|
|
Age of Appraisals and/or Current
|
12.50%
|
||||||
|
|
Market Conditions
|
|||||||
|
|
|
|||||||
|
Income Approach
|
Capitalization Rate
|
8.75%
|
||||||
|
|
|
|||||||
Residential Real Estate
|
3,096
|
Sales Comparison
|
Adjustment for Differences
|
(0.40%) -191.70%
|
|||||
|
|
Between the Comparable Sales
|
95.65%
|
||||||
|
|
|
|||||||
|
|
Management Adjustments for
|
0.00% - 10.00%
|
||||||
|
|
Age of Appraisals and/or Current
|
5.00%
|
||||||
|
|
Market Conditions
|
|||||||
|
|
|
|||||||
|
Income Approach
|
Capitalization Rate
|
15.00
|
||||||
|
|
|
|||||||
Commercial Real Estate
|
12,356
|
Sales Comparison
|
Adjustment for Differences
|
0.00% - 52.00
|
|||||
|
|
Between the Comparable Sales
|
26.00
|
||||||
|
|
|
|||||||
|
|
Management Adjustments for
|
0.00% - 40.00
|
||||||
|
|
Age of Appraisals and/or Current
|
20.00
|
||||||
|
|
Market Conditions
|
|||||||
|
|
|
|||||||
|
Income Approach
|
Capitalization Rate
|
10.50%
|
||||||
|
|
|
|||||||
|
|
Discount Rate
|
5.13%
|
||||||
|
|
|
|||||||
Other Real Estate Owned
|
8,102
|
Sales Comparison
|
Adjustment for Differences
|
(35.00%) - 319.10%
|
|||||
|
|
Between the Comparable Sales
|
142.05%
|
||||||
|
|
|
|||||||
|
|
Management Adjustment for
|
3.10% - 62.16%
|
||||||
|
|
Age of Appraisals and/or Current
|
30.32%
|
||||||
|
|
Market Conditions
|
|||||||
|
|
|
|||||||
|
Income Approach
|
Discount Rate
|
3.00%
|
||||||
|
|
|
|||||||
|
|
Capitalization Rate
|
14.00%
|
|
Available for Sale Securities
|
|||||||
|
June 30, 2013
|
December 31, 2012
|
||||||
|
||||||||
Balance, Beginning
|
$
|
1,138
|
$
|
1,122
|
||||
Total Realized/Unrealized Gains (Losses) Included In
|
||||||||
Purchases, Sales, Issuances and Settlements
|
||||||||
Transfers into Level 3
|
--
|
789
|
||||||
Securities Purchased During the Year
|
--
|
208
|
||||||
Securities Called During the Year
|
--
|
(1,000
|
)
|
|||||
Unrealized Gains Included in Other Comprehensive Income
|
(9
|
)
|
78
|
|||||
Loss on OTTI Impairment Included in Noninterest Income
|
--
|
(59
|
)
|
|||||
|
||||||||
Balance, Ending
|
$
|
1,129
|
$
|
1,138
|
|
Valuation
|
Unobservable
|
Range
|
||||||||
|
Fair Value
|
Techniques
|
Inputs
|
Weighted Avg
|
|||||||
|
|
|
|||||||||
Asset-Back Securities
|
$
|
132
|
Discounted Cash Flow
|
Discount Rate
|
3.48% - 3.91
|
%
|
|||||
|
|
|
3.70
|
%
|
|||||||
|
|
|
|||||||||
State, County and Municipal
|
997
|
Discounted Cash Flow
|
Discount Rate
|
N/A
|
*
|
|
To Be Well Capitalized
|
|||||||||||||||||||||||
|
For Capital
|
Under Prompt Corrective
|
||||||||||||||||||||||
|
Actual
|
Adequacy Purposes
|
Action Provisions
|
|||||||||||||||||||||
|
||||||||||||||||||||||||
|
Amount
|
Ratio
|
Amount
|
Ratio
|
Amount
|
Ratio
|
||||||||||||||||||
As of June 30, 2013
|
||||||||||||||||||||||||
|
||||||||||||||||||||||||
Total Capital
|
||||||||||||||||||||||||
to Risk-Weighted Assets
|
||||||||||||||||||||||||
Consolidated
|
$
|
123,678
|
16.89
|
%
|
$
|
58,580
|
8.00
|
%
|
NA
|
NA
|
||||||||||||||
Colony Bank
|
124,109
|
16.98
|
58,486
|
8.00
|
$
|
73,107
|
10.00
|
%
|
||||||||||||||||
|
||||||||||||||||||||||||
Tier 1 Capital
|
||||||||||||||||||||||||
to Risk-Weighted Assets
|
||||||||||||||||||||||||
Consolidated
|
114,478
|
15.63
|
29,290
|
4.00
|
NA
|
NA
|
||||||||||||||||||
Colony Bank
|
114,924
|
15.72
|
29,243
|
4.00
|
43,864
|
6.00
|
||||||||||||||||||
|
||||||||||||||||||||||||
Tier 1 Capital
|
||||||||||||||||||||||||
to Average Assets
|
||||||||||||||||||||||||
Consolidated
|
114,478
|
10.36
|
44,207
|
4.00
|
NA
|
NA
|
||||||||||||||||||
Colony Bank
|
114,924
|
10.42
|
44,134
|
4.00
|
55,167
|
5.00
|
|
To Be Well Capitalized
|
|||||||||||||||||||||||
|
For Capital
|
Under Prompt Corrective
|
||||||||||||||||||||||
|
Actual
|
Adequacy Purposes
|
Action Provisions
|
|||||||||||||||||||||
|
||||||||||||||||||||||||
|
Amount
|
Ratio
|
Amount
|
Ratio
|
Amount
|
Ratio
|
||||||||||||||||||
As of December 31, 2012
|
||||||||||||||||||||||||
|
||||||||||||||||||||||||
Total Capital
|
||||||||||||||||||||||||
to Risk-Weighted Assets
|
||||||||||||||||||||||||
Consolidated
|
$
|
122,630
|
16.47
|
%
|
$
|
59,548
|
8.00
|
%
|
NA
|
NA
|
||||||||||||||
Colony Bank
|
123,463
|
16.61
|
59,474
|
8.00
|
$
|
74,342
|
10.00
|
%
|
||||||||||||||||
|
||||||||||||||||||||||||
Tier 1 Capital
|
||||||||||||||||||||||||
to Risk-Weighted Assets
|
||||||||||||||||||||||||
Consolidated
|
113,283
|
15.22
|
29,774
|
4.00
|
NA
|
NA
|
||||||||||||||||||
Colony Bank
|
114,128
|
15.35
|
29,737
|
4.00
|
44,605
|
6.00
|
||||||||||||||||||
|
||||||||||||||||||||||||
Tier 1 Capital
|
||||||||||||||||||||||||
to Average Assets
|
||||||||||||||||||||||||
Consolidated
|
113,283
|
10.22
|
44,343
|
4.00
|
NA
|
NA
|
||||||||||||||||||
Colony Bank
|
114,128
|
10.31
|
44,282
|
4.00
|
55,352
|
5.00
|
|
Three Months Ended
|
Six Months Ended
|
||||||||||||||
|
June 30
|
June 30
|
||||||||||||||
|
2013
|
2012
|
2013
|
2012
|
||||||||||||
|
||||||||||||||||
Numerator
|
||||||||||||||||
Net Income (Loss) Available to Common Stockholders
|
$
|
611
|
$
|
403
|
$
|
1,178
|
$
|
592
|
||||||||
|
||||||||||||||||
Denominator
|
||||||||||||||||
Weighted Average Number of Common Shares
|
||||||||||||||||
Outstanding for Basic Earnings Per Common Share
|
8,439
|
8,439
|
8,439
|
8,439
|
||||||||||||
|
||||||||||||||||
Dilutive Effect of Potential Common Stock
|
||||||||||||||||
Restricted Stock
|
--
|
--
|
--
|
--
|
||||||||||||
Stock Warrants
|
--
|
--
|
--
|
--
|
||||||||||||
Weighted-Average Number of Shares Outstanding for
|
||||||||||||||||
Diluted Earnings Per Common Share
|
8,439
|
8,439
|
8,439
|
8,439
|
||||||||||||
|
||||||||||||||||
Earnings (Loss) Per Share - Basic
|
$
|
0.07
|
$
|
0.05
|
$
|
0.14
|
$
|
0.07
|
||||||||
|
||||||||||||||||
Earnings (Loss) Per Share - Diluted
|
$
|
0.07
|
$
|
0.05
|
$
|
0.14
|
$
|
0.07
|
· | Local and regional economic conditions and the impact they may have on the Company and its customers and the Company's assessment of that impact. |
· | Changes in estimates of future reserve requirements based upon the periodic review thereof under relevant regulatory and accounting requirements. |
· | The effects of and changes in trade, monetary and fiscal policies and laws, including interest rate policies of the Federal Reserve Board. |
· | Inflation, interest rate, market and monetary fluctuations. |
· | Political instability. |
· | Acts of war or terrorism. |
· | The timely development and acceptance of new products and services and perceived overall value of these products and services by users. |
· | Changes in consumer spending, borrowings and savings habits. |
· | Technological changes. |
· | Acquisitions and integration of acquired businesses. |
· | The ability to increase market share and control expenses. |
· | The effect of changes in laws and regulations (including laws and regulations concerning taxes, banking, securities and insurance) with which the Company and its subsidiary must comply. |
· | The effect of changes in accounting policies and practices, as may be adopted by the regulatory agencies, as well as the Financial Accounting Standards Board and other accounting standard setters. |
· | Changes in the Company's organization, compensation and benefit plans. |
· | The costs and effects of litigation and of unexpected or adverse outcomes in such litigation. |
· | Greater than expected costs or difficulties related to the integration of new lines of business. |
· | The Company's success at managing the risks involved in the foregoing items. |
· | Restrictions or conditions imposed by our regulators on our operations, including the terms of our Memorandum of Understanding. |
|
Three Months Ended
|
Six Months Ended
|
||||||||||||||
|
June 30
|
June 30
|
||||||||||||||
|
2013
|
2012
|
2013
|
2012
|
||||||||||||
|
||||||||||||||||
Taxable-equivalent net interest income
|
$
|
9,496
|
$
|
9,125
|
$
|
18,581
|
$
|
18,043
|
||||||||
Taxable-equivalent adjustment
|
41
|
34
|
80
|
68
|
||||||||||||
|
||||||||||||||||
Net interest income
|
9,455
|
9,091
|
18,501
|
17,975
|
||||||||||||
Provision for loan losses
|
1,200
|
1,943
|
2,700
|
3,885
|
||||||||||||
Noninterest income
|
2,040
|
2,374
|
4,250
|
4,188
|
||||||||||||
Noninterest expense
|
8,739
|
8,405
|
17,131
|
16,388
|
||||||||||||
|
||||||||||||||||
Income before income taxes
|
$
|
1,556
|
$
|
1,117
|
2,920
|
1,890
|
||||||||||
Income Taxes
|
570
|
357
|
997
|
589
|
||||||||||||
|
||||||||||||||||
Net income
|
$
|
986
|
$
|
760
|
$
|
1,923
|
$
|
1,301
|
||||||||
|
||||||||||||||||
Preferred stock dividends
|
375
|
357
|
745
|
709
|
||||||||||||
|
||||||||||||||||
Net income available to common shareholders
|
$
|
611
|
$
|
403
|
$
|
1,178
|
$
|
592
|
||||||||
|
||||||||||||||||
Net income available to common shareholders:
|
||||||||||||||||
Basic
|
$
|
0.07
|
$
|
0.05
|
$
|
0.14
|
$
|
0.07
|
||||||||
Diluted
|
$
|
0.07
|
$
|
0.05
|
$
|
0.14
|
$
|
0.07
|
||||||||
Return on average assets
|
0.22
|
%
|
0.14
|
%
|
0.21
|
%
|
0.10
|
%
|
||||||||
Return on average common equity
|
2.56
|
%
|
1.66
|
%
|
2.47
|
%
|
1.22
|
%
|
|
Changes from June 30, 2012 to June 30, 2013
|
|||||||||||
($ in thousands)
|
Volume
|
Rate
|
Total
|
|||||||||
|
||||||||||||
Interest Income
|
||||||||||||
Loans, Net-taxable
|
$
|
819
|
$
|
(932
|
)
|
$
|
(113
|
)
|
||||
|
||||||||||||
Investment Securities
|
||||||||||||
Taxable
|
(284
|
)
|
(1,222
|
)
|
(1,506
|
)
|
||||||
Tax-exempt
|
(26
|
)
|
2
|
(24
|
)
|
|||||||
Total Investment Securities
|
(310
|
)
|
(1,220
|
)
|
(1,530
|
)
|
||||||
|
||||||||||||
Interest-Bearing Deposits in other Banks
|
(15
|
)
|
1
|
(14
|
)
|
|||||||
|
||||||||||||
Federal Funds Sold
|
(36
|
)
|
---
|
(36
|
)
|
|||||||
|
||||||||||||
Other Interest - Earning Assets
|
(13
|
)
|
14
|
1
|
||||||||
Total Interest Income
|
445
|
(2,137
|
)
|
(1,692
|
)
|
|||||||
|
||||||||||||
Interest Expense
|
||||||||||||
Interest-Bearing Demand and Savings Deposits
|
75
|
(59
|
)
|
16
|
||||||||
Time Deposits
|
(619
|
)
|
(1,029
|
)
|
(1,648
|
)
|
||||||
Subordinated Debentures
|
---
|
(24
|
)
|
(24
|
)
|
|||||||
Other Borrowed Money
|
(344
|
)
|
(230
|
)
|
(574
|
)
|
||||||
|
||||||||||||
Total Interest Expense
|
(888
|
)
|
(1,342
|
)
|
(2,230
|
)
|
||||||
Net Interest Income
|
$
|
1,333
|
$
|
(795
|
)
|
$
|
538
|
(1) | Changes in net interest income for the periods, based on either changes in average balances or changes in average rates for interest-earning assets and interest-bearing liabilities, are shown on this table. During each year, there are numerous and simultaneous balance and rate changes; therefore, it is not possible to precisely allocate the changes between balances and rates. For the purpose of this table, changes that are not exclusively due to balance changes or rate changes have been attributed to rates. |
|
Three Months Ended
|
Six Months Ended
|
||||||||||||||
|
June 30
|
June 30
|
||||||||||||||
|
2013
|
2012
|
2013
|
2012
|
||||||||||||
|
||||||||||||||||
Service Charges on Deposit Accounts
|
$
|
1,147
|
$
|
814
|
$
|
2,248
|
$
|
1,610
|
||||||||
Other Charges, Commissions and Fees
|
443
|
328
|
847
|
747
|
||||||||||||
Other
|
303
|
377
|
897
|
758
|
||||||||||||
Mortgage Fee Income
|
141
|
112
|
260
|
193
|
||||||||||||
Securities Gains (Losses)
|
6
|
743
|
(2
|
)
|
880
|
|||||||||||
|
||||||||||||||||
Total
|
$
|
2,040
|
$
|
2,374
|
$
|
4,250
|
$
|
4,188
|
|
Three Months Ended
|
Six Months Ended
|
||||||||||||||
|
June 30
|
June 30
|
||||||||||||||
|
2013
|
2012
|
2013
|
2012
|
||||||||||||
|
||||||||||||||||
Salaries and Employee Benefits
|
$
|
4,149
|
$
|
3,833
|
$
|
8,318
|
$
|
7,653
|
||||||||
Occupancy and Equipment
|
935
|
963
|
1,868
|
1,901
|
||||||||||||
Other
|
3,655
|
3,609
|
6,945
|
6,834
|
||||||||||||
|
||||||||||||||||
Total
|
$
|
8,739
|
$
|
8,405
|
$
|
17,131
|
$
|
16,388
|
|
June 30, 2013
|
December 31, 2012
|
||||||
|
||||||||
Commercial, Financial and Agricultural
|
$
|
65,335
|
$
|
61,895
|
||||
Real Estate
|
||||||||
Construction
|
60,888
|
59,660
|
||||||
Mortgage, Farmland
|
49,798
|
49,057
|
||||||
Mortgage, Other
|
533,879
|
538,231
|
||||||
Consumer
|
27,439
|
29,778
|
||||||
Other
|
6,804
|
8,429
|
||||||
|
744,143
|
747,050
|
||||||
Unearned Interest and Fees
|
(266
|
)
|
(234
|
)
|
||||
Allowance for Loan Losses
|
(12,957
|
)
|
(12,737
|
)
|
||||
|
||||||||
Loans
|
$
|
730,920
|
$
|
734,079
|
|
June 30, 2013
|
December 31, 2012
|
June 30, 2012
|
|||||||||
|
||||||||||||
Loans Accounted for on Nonaccrual
|
$
|
24,685
|
$
|
29,851
|
$
|
35,474
|
||||||
Loans Accruing Past Due 90 Days or More
|
--
|
4
|
213
|
|||||||||
Other Real Estate Foreclosed
|
16,128
|
15,941
|
17,915
|
|||||||||
Securities Accounted for on Nonaccrual
|
367
|
366
|
367
|
|||||||||
Total Nonperforming Assets
|
$
|
41,180
|
$
|
46,162
|
$
|
53,969
|
||||||
|
||||||||||||
Nonperforming Assets as a Percentage of:
|
||||||||||||
Total Loans and Foreclosed Assets
|
5.42
|
%
|
6.05
|
%
|
7.35
|
%
|
||||||
Total Assets
|
3.72
|
%
|
4.05
|
%
|
4.76
|
%
|
||||||
Supplemental Data:
|
||||||||||||
Trouble Debt Restructured Loans
|
||||||||||||
In Compliance with Modified Terms
|
21,683
|
24,870
|
30,096
|
|||||||||
Trouble Debt Restructured Loans
|
||||||||||||
Past Due 30-89 Days
|
204
|
1,377
|
1,136
|
|||||||||
Accruing Past Due Loans:
|
||||||||||||
30-89 Days Past Due
|
$
|
7,912
|
$
|
14,911
|
$
|
7,120
|
||||||
90 or More Days Past Due
|
--
|
4
|
213
|
|||||||||
Total Accruing Past Due Loans
|
$
|
7,912
|
$
|
14,915
|
$
|
7,333
|
|
June 30, 2013
|
June 30, 2012
|
||||||||||||||
|
Average
|
Average
|
Average
|
Average
|
||||||||||||
($ in thousands)
|
Amount
|
Rate
|
Amount
|
Rate
|
||||||||||||
|
||||||||||||||||
Noninterest-Bearing Demand Deposits
|
$
|
113,139
|
$
|
98,475
|
||||||||||||
Interest-Bearing Demand and Savings Deposits
|
366,234
|
0.36
|
%
|
328,007
|
0.39
|
%
|
||||||||||
Time Deposits
|
473,186
|
1.03
|
%
|
557,981
|
1.46
|
%
|
||||||||||
|
||||||||||||||||
Total Deposits
|
$
|
952,559
|
0.65
|
%
|
$
|
984,463
|
0.96
|
%
|
|
Three Months Ended
|
Six Months Ended
|
||||||||||||||
|
June 30
|
June 30
|
||||||||||||||
|
2013
|
2012
|
2013
|
2012
|
||||||||||||
|
||||||||||||||||
Return on Average Assets (1)
|
0.22
|
%
|
0.14
|
%
|
0.21
|
%
|
0.10
|
%
|
||||||||
|
||||||||||||||||
Return on Average Total Equity (1)
|
2.56
|
%
|
1.66
|
%
|
2.47
|
%
|
1.22
|
%
|
||||||||
|
||||||||||||||||
Average Total Equity to Average Assets
|
8.61
|
%
|
8.44
|
%
|
8.55
|
%
|
8.30
|
%
|
(1) | Computed using annualized net income available to common shareholders. |
AVERAGE BALANCE SHEETS
|
Six Months Ended
|
Six Months Ended
|
||||||||||||||||||||||
|
June 30, 2013
|
June 30, 2012
|
||||||||||||||||||||||
|
Average
|
Income/
|
Yields/
|
Average
|
Income/
|
Yields/
|
||||||||||||||||||
($ in thousands)
|
Balances
|
Expense
|
Rates
|
Balances
|
Expense
|
Rates
|
||||||||||||||||||
Assets
|
||||||||||||||||||||||||
Interest-Earning Assets
|
||||||||||||||||||||||||
Loans, Net of Unearned Interest and fees
|
||||||||||||||||||||||||
Taxable (1)
|
$
|
738,656
|
$
|
20,777
|
5.63
|
%
|
$
|
710,814
|
$
|
20,890
|
5.88
|
%
|
||||||||||||
Investment Securities
|
||||||||||||||||||||||||
Taxable
|
276,020
|
1,621
|
1.17
|
%
|
303,553
|
3,127
|
2.06
|
%
|
||||||||||||||||
Tax-Exempt (2)
|
2,791
|
68
|
4.87
|
%
|
3,867
|
92
|
4.76
|
%
|
||||||||||||||||
Total Investment Securities
|
278,811
|
1,689
|
1.21
|
%
|
307,420
|
3,219
|
2.09
|
%
|
||||||||||||||||
Interest-Bearing Deposits
|
11,473
|
16
|
0.28
|
%
|
22,309
|
30
|
0.27
|
%
|
||||||||||||||||
Federal Funds Sold
|
15,330
|
20
|
0.26
|
%
|
44,188
|
56
|
0.25
|
%
|
||||||||||||||||
Interest-Bearing Other Assets
|
3,340
|
38
|
2.28
|
%
|
5,117
|
37
|
1.45
|
%
|
||||||||||||||||
Total Interest-Earning Assets
|
1,047,610
|
$
|
22,540
|
4.30
|
%
|
1,089,848
|
$
|
24,232
|
4.45
|
%
|
||||||||||||||
Non-interest-Earning Assets
|
||||||||||||||||||||||||
Cash and Cash Equivalents
|
19,732
|
18,785
|
||||||||||||||||||||||
Allowance for Loan Losses
|
(13,200
|
)
|
(16,324
|
)
|
||||||||||||||||||||
Other Assets
|
63,059
|
73,206
|
||||||||||||||||||||||
Total Noninterest-Earning Assets
|
69,591
|
75,667
|
||||||||||||||||||||||
Total Assets
|
$
|
1,117,201
|
$
|
1,165,515
|
||||||||||||||||||||
Liabilities and Stockholders' Equity
|
||||||||||||||||||||||||
Interest-Bearing Liabilities
|
||||||||||||||||||||||||
Interest-Bearing Deposits
|
||||||||||||||||||||||||
Interest-Bearing Demand and Savings
|
$
|
366,234
|
$
|
661
|
0.36
|
%
|
$
|
328,007
|
$
|
645
|
0.39
|
%
|
||||||||||||
Other Time
|
473,186
|
2,430
|
1.03
|
%
|
557,981
|
4,078
|
1.46
|
%
|
||||||||||||||||
Total Interest-Bearing Deposits
|
839,420
|
3,091
|
0.74
|
%
|
885,988
|
4,723
|
1.07
|
%
|
||||||||||||||||
Other Interest-Bearing Liabilities
|
||||||||||||||||||||||||
Other Borrowed Money
|
39,575
|
611
|
3.09
|
%
|
55,745
|
1,185
|
4.25
|
%
|
||||||||||||||||
Subordinated Debentures
|
24,229
|
257
|
2.12
|
%
|
24,229
|
281
|
2.32
|
%
|
||||||||||||||||
Federal Funds Purchased and Repurchase Agreements
|
69
|
--
|
--
|
--
|
--
|
--
|
||||||||||||||||||
Total Other Interest-Bearing Liabilities
|
63,873
|
868
|
2.72
|
%
|
79,974
|
1,466
|
3.67
|
%
|
||||||||||||||||
Total Interest-Bearing Liabilities
|
903,293
|
$
|
3,959
|
0.88
|
%
|
965,962
|
$
|
6,189
|
1.28
|
%
|
||||||||||||||
Noninterest-Bearing Liabilities and Stockholders' Equity
|
||||||||||||||||||||||||
Demand Deposits
|
113,139
|
98,475
|
||||||||||||||||||||||
Other Liabilities
|
5,200
|
4,312
|
||||||||||||||||||||||
Stockholders' Equity
|
95,569
|
96,766
|
||||||||||||||||||||||
Total Noninterest-Bearing Liabilities and Stockholders' Equity
|
213,908
|
199,553
|
||||||||||||||||||||||
Total Liabilities and Stockholders' Equity
|
$
|
1,117,201
|
$
|
1,165,515
|
||||||||||||||||||||
|
||||||||||||||||||||||||
Interest Rate Spread
|
3.42
|
%
|
3.17
|
%
|
||||||||||||||||||||
Net Interest Income
|
$
|
18,581
|
$
|
18,043
|
||||||||||||||||||||
Net Interest Margin
|
3.55
|
%
|
3.31
|
%
|
(1) | The average balance of loans includes the average balance of nonaccrual loans. Income on such loans is recognized and recorded on the cash basis. Taxable equivalent adjustments totaling $57 and $37 for six month periods ended June 30, 2013 and 2012, respectively, are included in tax-exempt interest on loans. |
(2) | Taxable-equivalent adjustments totaling $23 and $31 for six month periods ended June 30, 2013 and 2012, respectively, are included in tax-exempt interest on investment securities. The adjustments are based on a federal tax rate of 34 percent with appropriate reductions for the effect of disallowed interest expense incurred in carrying tax-exempt obligations. |
3.1 | Articles of Incorporation |
3.2 | Bylaws, as Amended |
3.3 | Article of Amendment to the Company's Articles of Incorporation Authorizing Additional Capital Stock in the Form of Ten Million Shares of Preferred Stock |
3.4 | Articles of Amendment to the Company's Articles of Incorporation Establishing the Terms of the Series A Preferred Stock |
4.1 | Instruments Defining the Rights of Security Holders |
4.2 | Warrant to Purchase up to 500,000 shares of Common Stock |
4.3 | Form of Series A Preferred Stock Certificate |
10.1 | Deferred Compensation Plan and Sample Director Agreement |
10.2 | Profit-Sharing Plan Dated January 1, 1979 |
10.3 | 1999 Restricted Stock Grant Plan and Restricted Stock Grant Agreement |
10.4 | 2004 Restricted Stock Grant Plan and Restricted Stock Grant Agreement |
10.5 | Lease Agreement – Mobile Home Tracts, LLC c/o Stafford Properties, Inc. and Colony Bank Worth |
10.6 | Letter Agreement, Dated January 9, 2009, Including Securities Purchase Agreement – Standard Terms Incorporated by Reference Therein, Between the Company and the United States Department of the Treasury |
10.7 | Form of Waiver, Executed by Each of Messrs Al D. Ross, Terry L. Hester, Henry F. Brown, Jr., Walter P. Patten and Larry E. Stevenson |
10.8 | Employment Agreement, Dated April 27, 2012 Between Edward P. Loomis, Jr. and ColonyBankcorp, Inc. |
31.1 | Certificate of Chief Executive Officer Pursuant to Section 302 of Sarbanes-Oxley Act of 2002 |
31.2 | Certificate of Chief Financial Officer Pursuant to Section 302 of Sarbanes – Oxley Act of 2002 |
32.1 | Certification of Chief Executive Officer and Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
101.INS | XBRL Instance Document |
101.SCH | XBRL Schema Document |
101.CAL | XBRL Calculation Linkbase Document |
101.DEF | XBRL Definition Linkbase Document |
101.LAB | XBRL Label Linkbase Document |
101.PRE | XBRL Presentation Linkbase Document |
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Colony Bankcorp, Inc.
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/s/ Edward P. Loomis, Jr.
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Date:
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August 5, 2013
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Edward P. Loomis, Jr.,
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President and Chief Executive Officer
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/s/ Terry L. Hester
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Date:
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August 5, 2013
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Terry L. Hester,
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Executive Vice President and Chief Financial Officer
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1. | I have reviewed this Form 10-Q of Colony Bankcorp, Inc: |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a)
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designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b)
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designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c)
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evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d)
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disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5. | The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): |
a)
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all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
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b)
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any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
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August 5, 2013
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/s/ Edward P. Loomis, Jr.
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Edward P. Loomis, Jr., President and
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Chief Executive Officer
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1. | I have reviewed this Form 10-Q of Colony Bankcorp, Inc: |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) | designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d) | disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): |
a) | all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
b) | any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
August 5, 2013
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/s/ Terry L. Hester
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Terry L. Hester, Executive Vice President and
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Chief Financial Officer
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(1) | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
(2) | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
August 5, 2013
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/s/ Edward P. Loomis, Jr.
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Edward P. Loomis, Jr., President and
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Chief Executive Officer
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August 5, 2013
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/s/ Terry L. Hester
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Terry L. Hester, Executive Vice President and
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Chief Financial Officer
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Fair Value of Financial Instruments and Fair Value Measurements
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Fair Value of Financial Instruments and Fair Value Measurements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value of Financial Instruments and Fair Value Measurements | (11) Fair Value of Financial Instruments and Fair Value Measurements Generally accepted accounting standards in the U.S. require disclosure of fair value information about financial instruments, whether or not recognized on the face of the balance sheet, for which it is practicable to estimate that value. The assumptions used in the estimation of the fair value of Colony Bankcorp, Inc. and Subsidiary's financial instruments are detailed hereafter. Where quoted prices are not available, fair values are based on estimates using discounted cash flows and other valuation techniques. The use of discounted cash flows can be significantly affected by the assumptions used, including the discount rate and estimates of future cash flows. The following disclosures should not be considered a surrogate of the liquidation value of the Company, but rather a good-faith estimate of the increase or decrease in value of financial instruments held by the Company since purchase, origination or issuance. Cash and Short-Term Investments – For cash, due from banks, bank-owned deposits and federal funds sold, the carrying amount is a reasonable estimate of fair value and is classified as Level 1. Investment Securities – Fair values for investment securities are based on quoted market prices where available. If quoted market prices are not available, estimated fair values are based on quoted market prices of comparable Instruments. If a comparable is not available, the investment securities are classified as level 3. Federal Home Loan Bank Stock – The fair value of Federal Home Loan Bank stock approximates carrying value. Loans – The fair value of fixed rate loans is estimated by discounting the future cash flows using the current rates at which similar loans would be made to borrowers with similar credit ratings. For variable rate loans, the carrying amount is a reasonable estimate of fair value. Deposit Liabilities – The fair value of demand deposits, savings accounts and certain money market deposits is the amount payable on demand at the reporting date and is classified as Level 1. The fair value of fixed maturity certificates of deposit is estimated by discounting the future cash flows using the rates currently offered for deposits of similar remaining maturities and is classified as Level 2. Subordinated Debentures – Fair value approximates carrying value due to the variable interest rates of the subordinated debentures. Other Borrowed Money – The fair value of other borrowed money is calculated by discounting contractual cash flows using an estimated interest rate based on current rates available to the Company for debt of similar remaining maturities and collateral terms. Other borrowed money is classified as Level 2 due to their expected maturities. Disclosures of the fair value of financial assets and financial liabilities, including those financial assets and financial liabilities that are not measured and reported at fair value on a recurring basis or non-recurring basis, are required in the financial statements. The carrying amount, estimated fair values, and placement in the fair value hierarchy of the Company's financial instruments as of June 30, 2013 and December 31, 2012 are as follows:
Fair value estimates are made at a specific point in time, based on relevant market information and information about the financial instrument. These estimates do not reflect any premium or discount that could result from offering for sale at one time the Company's entire holdings of a particular financial instrument. Because no market exists for a significant portion of the Company's financial instruments, fair value estimates are based on many judgments. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and therefore cannot be determined with precision. Changes in assumptions could significantly affect the estimates. Fair value estimates are based on existing on and off-balance sheet financial instruments without attempting to estimate the value of anticipated future business and the value of assets and liabilities that are not considered financial instruments. Significant assets and liabilities that are not considered financial instruments include deferred income taxes and premises and equipment. In addition, the tax ramifications related to the realization of the unrealized gains and losses can have a significant effect on fair value estimates and have not been considered in the estimates. Fair Value Measurements Generally accepted accounting principles related to Fair Value Measurements, defines fair value, establishes a framework for measuring fair value, establishes a three-level valuation hierarchy for disclosure of fair value measurements and enhances disclosure requirements for fair value measurements. The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date. The three levels are defined as follows:
Following is a description of the valuation methodologies used for instruments measured at fair value, as well as the general classification of such instruments pursuant to the valuation hierarchy: Assets Securities – Where quoted prices are available in an active market, securities are classified within level 1 of the valuation hierarchy. Level 1 inputs include securities that have quoted prices in active markets for identical assets. If quoted market prices are not available, then fair values are estimated by using pricing models, quoted prices of securities with similar characteristics, or discounted cash flow. Examples of such instruments, which would generally be classified within level 2 of the valuation hierarchy, include certain collateralized mortgage and debt obligations and certain high-yield debt securities. In certain cases where there is limited activity or less transparency around inputs to the valuation, securities are classified within level 3 of the valuation hierarchy. When measuring fair value, the valuation techniques available under the market approach, income approach and/or cost approach are used. The Company's evaluations are based on market data and the Company employs combinations of these approaches for its valuation methods depending on the asset class. Impaired loans – Impaired loans are those that are accounted for under ASC Sub-topic 310-40, Troubled Debt Restructurings by Creditors, in which the Company has measured impairment generally based on the fair value of the loan's collateral. Fair value is generally determined based upon independent third-party appraisals of the properties, or discounted cash flows based upon the expected proceeds. These assets are included as Level 3 fair values, based upon the lowest level of input that is significant to the fair value measurements. Other Real Estate – Other real estate owned assets are adjusted to fair value less estimated selling costs upon transfer of the loans to other real estate owned. Typically, an external, third-party appraisal is performed on the collateral upon transfer into the other real estate owned account to determine the asset's fair value. Subsequent adjustments to the collateral's value may be based upon either updated third-party appraisals or management's knowledge of the collateral and the current real estate market conditions. Appraised amounts used in determining the asset's fair value, whether internally or externally prepared, are discounted 10 percent to account for selling and marketing costs. Adjustments are routinely made in the appraisal process by the appraisers to adjust for differences between the comparable sales and income data available. Such adjustments are typically significant and result in a level 3 classification of the inputs for determining fair value. Because of the high degree of judgment required in estimating the fair value of other real estate owned assets and because of the relationship between fair value and general economic conditions, we consider the fair value of other real estate owned assets to be highly sensitive to changes in market conditions. Assets and Liabilities Measured at Fair Value on a Recurring Basis – The following table presents the recorded amount of the Company's assets measured at fair value on a recurring and nonrecurring basis as of June 30, 2013 and December 31, 2012, aggregated by the level in the fair value hierarchy within which those measurements fall. The table below includes only impaired loans with a specific reserve and only other real estate properties with a valuation allowance at June 30, 2013. Those impaired loans and other real estate properties are shown net of the related specific reserves and valuation allowances.
Liabilities The Company did not identify any liabilities that are required to be presented at fair value. Fair Value Measurements Using Significant Unobservable Inputs (Level 3) The following table presents quantitative information about the significant unobservable inputs used in the fair value measurements for assets in level 3 of the fair value hierarchy measured on a nonrecurring basis at June 30, 2013. This table is comprised primarily of collateral dependent impaired loans and other real estate owned:
The table below presents a reconciliation and statement of income classification of gains and losses for all assets measured at fair value on a recurring basis using significant unobservable inputs (level 3) for the six months ended June 30, 2013 and the twelve months ended December 31, 2012.
The Company's policy is to recognize transfers in and transfers out of levels 1, 2 and 3 as of the end of a reporting period. As of December 31, 2012, the Company transferred certain state, county and municipal securities out of level 2 and into level 3. The transfers into level 3 were the result of decreased market activity for these types of securities, as well as a lack of current credit ratings on these securities. There were no gains or losses recognized as a result of the transfers. There were no transfers of securities between level 1 and level 2 for the six months ended June 30, 2013. The following table presents quantitative information about recurring level 3 fair value measurements as of June 30, 2013.
* The Company relies on a third-party pricing service to value its municipal securities. The details of the unobservable inputs and other adjustments used by the third-party pricing service were not readily available to the Company. |
Allowance for Loan Losses
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Jun. 30, 2013
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Allowance for Loan Losses [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Allowance for Loan Losses | (4) Allowance for Loan Losses The following tables detail activity in the allowance for loan losses, segregated by class of loan, for the six month period ended June 30, 2013 and June 30, 2012. Allocation of a portion of the allowance to one category of loans does not preclude its availability to absorb losses in other loan categories and periodically may result in reallocation within the provision categories.
During 2012, the Company changed its loss history period used in calculating the ALLL from a one year average to a rolling eight quarter average. At June 30, 2012 the loss history period used was based on the annual loss rate from calendar year 2011, whereas the loss history period used at June 30, 2013 was based on the loss rate from the eight quarters ended March 31, 2013. The Company determines its individual reserves during its quarterly review of substandard loans. This process involves reviewing all loans with a risk grade of 6 or greater and an outstanding balance of $250,000 or more, regardless of the loans impairment classification. Effective March 31, 2013, management increased the dollar threshold of this review process from $50,000 to $250,000. The threshold change resulted in loans totaling $3.1 million at June 30, 2013 being removed from the individual impairment review process and being placed in the collective review process. These loans are now subject to general reserves. Since not all loans in the substandard category are considered impaired, this quarterly review process may result in the identification of specific reserves on nonimpaired loans. Management considers those loans graded substandard, but not classified as impaired, to be higher risk loans and, therefore, makes specific allocations to the allowance for those loans if warranted. The total of such loans is $8,154 and $14,994 as of June 30, 2013 and 2012, respectively. Specific allowance allocations were made for these loans totaling $615 and $1,570 as of June 30, 2013 and 2012, respectively. Since these loans are not considered impaired, both the loan balance and related specific allocation are included in the "Collectively Evaluated for Impairment" column of the following tables. At June 30, 2013, impaired loans totaling $2.17 million were below the $250,000 review threshold and were not individually reviewed for impairment. Those loans were subject to the bank's general loan loss reserve methodology and are included in the "Collectively Evaluated for Impairment" column of the following tables. Likewise, at June 30, 2012, impaired loans totaling $748 thousand were below the $50,000 review threshold and were subject to the bank's general loan loss reserve methodology and are included in the "Collectively Evaluated for Impairment" column of the following tables. The following tables present breakdowns of the allowance for loan losses, segregated by impairment methodology for June 30, 2013 and 2012:
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Allowance for Loan Losses (Tables)
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Jun. 30, 2013
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Allowance for Loan Losses [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Allowance for loan losses | The following tables detail activity in the allowance for loan losses, segregated by class of loan, for the six month period ended June 30, 2013 and June 30, 2012. Allocation of a portion of the allowance to one category of loans does not preclude its availability to absorb losses in other loan categories and periodically may result in reallocation within the provision categories.
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Allowance for loan losses, segregated by impairment methodology | The following tables present breakdowns of the allowance for loan losses, segregated by impairment methodology for June 30, 2013 and 2012:
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Regulatory Capital Matters
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Jun. 30, 2013
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Regulatory Capital Matters [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Regulatory Capital Matters | (12) Regulatory Capital Matters The amount of dividends payable to the parent company from the subsidiary bank is limited by various banking regulatory agencies. Upon approval by regulatory authorities, the Bank may pay cash dividends to the parent company in excess of regulatory limitations. Additionally, in the third quarter of 2009, the Company suspended the payment of dividends to common shareholders. At June 30, 2013, the Company is subject to certain regulatory restrictions that preclude the declaration of or payment of any dividends to its common stockholders, without prior approval from the Federal Reserve Bank. 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 June 30, 2013, the Company meets all capital adequacy requirements to which it is subject 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. The following table summarizes regulatory capital information as of June 30, 2013 and December 31, 2012 on a consolidated basis and for each significant subsidiary, as defined.
The Bank is currently subject to a memorandum of understanding (MOU) which requires, among other things, that the Bank maintain minimum capital ratios at specified levels higher than those otherwise required by applicable regulations as follows: Tier 1 capital to total average assets of 8% and total risk-based capital to total risk-weighted assets of 10% during the life of the MOU. The MOU also requires that, prior to declaring or paying any cash dividend to the Company, the Bank must obtain written consent of its regulators. |
Other Borrowed Money (Tables)
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6 Months Ended | |||||||||||||||||||||||||
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Jun. 30, 2013
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Other Borrowed Money [Abstract] | ||||||||||||||||||||||||||
Other borrowed money | Other borrowed money at June 30, 2013 and December 31, 2012 is summarized as follows:
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Aggregate stated maturities of other borrowed money | The aggregate stated maturities of other borrowed money at June 30, 2013 are as follows:
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Deposits (Tables)
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6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2013
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Deposits [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Components of interest-bearing deposits | Components of interest-bearing deposits as of June 30, 2013 and December 31, 2012 are as follows:
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Scheduled maturities of certificates of deposits | As of June 30, 2013 and December 31, 2012, the scheduled maturities of certificates of deposits are as follows:
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