Southwest Georgia Financial Corporation (the “Company”) (NYSE
American: SGB), a full-service community bank holding company,
today reported results of operations for the second quarter ended
June 30, 2019. Comparisons are with the prior-year period unless
otherwise noted.
“The strategic investments made to organically grow our
franchise are paying off. Loans grew 12% year-over-year with
contributions coming from each of our markets. Our loan growth was
funded by 13% deposit growth, which included a meaningful amount of
noninterest-bearing transaction accounts. We believe continued
disruptions in the banking industry will eventually create
additional deposit opportunities for SGB,” commented DeWitt Drew,
President and CEO. “We are seeing an extraordinary amount of
pricing pressure on both sides of the balance sheet; however, we
are encouraged by the continuous growth and true expansion of our
net interest margin, which we believe is a direct result of our
community and customer centric focus.”
Income Highlights
- Net income increased 13% to $1.3 million, or $0.51 per diluted
share, from $1.15 million, or $0.45 per diluted share.
- Net interest income was up $485 thousand to $5.05 million, due
to increased interest and fees on loans of $856 thousand, partially
offset by higher costs on interest bearing deposits of $493
thousand. Net interest margin expanded 10 basis points to 4.06%.
The provision for loan losses was up $110 thousand to $250
thousand, due to continued loan growth.
- Noninterest income increased $247 thousand, primarily due to a
$244 thousand net gain from the sale of fixed assets. Core
noninterest income was up slightly as insurance services growth of
9% offset declines in other business lines.
- Higher net interest income and noninterest income was partially
offset by continued investments to drive growth. Noninterest
expense was up $418 thousand, or 10%. The largest component of the
increase was within salary and employee benefits, which was up $196
thousand.
Balance Sheet Trends
- Total assets at June 30, 2019 were $552.5 million, up 9% or
$44.3 million. Total loans grew more than 12%, or $42.4 million, to
$388.3 million, while continuing to maintain high standards of
credit quality. Net charge-offs to average loans were 0.16%.
- Total deposits were up nearly 13%, or $52.2 million, to $467.6
million at quarter-end. Federal Home Loan Bank Advances were down
$13.3 million, due to strong deposit growth. The average cost of
all interest bearing liabilities increased 32 basis points to
1.16%.
Capital Management
- Book value per share grew 12% to $18.48 at June 30, 2019.
- In June 2019, the Company paid a quarterly cash dividend of
$0.12 per common share. Southwest Georgia Financial Corporation or
its predecessor, Southwest Georgia Bank, has paid cash dividends
for 91 consecutive years.
Webcast and Conference Call
The Company will host a conference call and webcast on Tuesday,
July 23, 2019 at 1:00 p.m. ET. Management will review the financial
and operating results for the second quarter of 2019, as well as
the Company’s strategy and outlook. A question and answer session
will follow the formal discussion.
The conference call can be accessed by calling (201) 689-8263.
Alternatively, the webcast can be monitored at www.sgb.bank.
A telephonic replay will be available from 4:00 p.m. ET on the
day of the teleconference until Tuesday, July 30, 2019. To listen
to the archived call, dial (412) 317-6671 and enter conference ID
number 13691911, or access the webcast replay at
www.sgb.bank/investor-relations, where a transcript will be posted
once available.
About Southwest Georgia Financial Corporation
Southwest Georgia Financial Corporation is a state-chartered
bank holding company with approximately $552 million in assets
headquartered in Moultrie, Georgia. Its primary subsidiary,
Southwest Georgia Bank, offers comprehensive financial services to
consumer, business and government customers. The current banking
facilities include the main office located in Colquitt County and
branch offices located in Baker County, Worth County, Lowndes
County and Tift County. In addition to conventional banking
services, the Company provides investment planning and management,
trust management, and commercial and individual insurance products.
Insurance products and advice are provided by Southwest Georgia
Insurance Services, which is located in Colquitt County. The
Company routinely posts news and other important information on its
website at www.sgb.bank.
SAFE HARBOR STATEMENT
This news release contains forward-looking statements, as
defined by federal securities laws, including statements about the
Company’s financial outlook. These statements are based on current
expectations and are provided to assist in the understanding of
future financial performance. Such performance involves risks and
uncertainties that may cause actual results to differ materially
from those expressed or implied in any such statements. Important
factors that could cause actual results to differ materially from
those contemplated today include a change in the Company’s capital
structure, new or expanded regulatory requirements, the success of
the Company’s growth strategy, customer preferences, the interest
rate environment and other factors described in the Company’s
filings with the Securities and Exchange Commission, including its
Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q
under the sections entitled “Forward-Looking Statements” and “Risk
Factors.” The Company undertakes no obligation to update any
forward-looking statements as a result of new information, future
events or otherwise, except as otherwise required by law.
Financial tables follow.
SOUTHWEST GEORGIA FINANCIAL
CORPORATION
CONSOLIDATED STATEMENT OF
CONDITION
(Dollars in thousands except
per share data)
(Unaudited)
(Audited)
(Unaudited)
June 30,
December 31,
June 30,
2019
2018
2018
ASSETS
Cash and due from banks
$
13,173
$
14,051
$
7,786
Interest-bearing deposits in banks
17,449
21,448
27,292
Certificates of deposit in other banks
2,977
2,732
1,985
Investment securities available for
sale
73,713
58,314
59,281
Investment securities held to maturity
32,546
36,827
41,189
Federal Home Loan Bank stock, at cost
1,870
1,820
2,475
Loans, less unearned income and
discount
388,268
376,750
345,852
Allowance for loan losses
(3,465)
(3,429)
(3,193)
Net loans
384,803
373,321
342,659
Premises and equipment
14,264
14,574
13,693
Bank properties held for sale
0
0
212
Foreclosed assets, net
38
128
38
Intangible assets
0
4
12
Bank owned life insurance
6,846
6,779
6,636
Other assets
4,796
4,835
4,895
Total assets
$
552,475
$
534,833
$
508,153
LIABILITIES AND SHAREHOLDERS'
EQUITY
Deposits:
Interest bearing business checking
$
31,309
$
28,071
$
29,315
NOW accounts
20,773
35,816
54,043
Money market
156,449
158,730
115,022
Savings
33,593
31,849
32,831
Certificates of deposit $100,000 and
over
27,257
16,265
22,472
Other time accounts
80,967
81,214
63,449
Total interest-bearing deposits
350,348
351,945
317,132
Noninterest-bearing deposits
117,289
103,695
98,305
Total deposits
467,637
455,640
415,437
Other borrowings
6,314
10,457
19,471
Long-term debt
27,386
21,171
27,557
Accounts payable and accrued
liabilities
4,079
3,946
3,754
Total liabilities
505,416
491,214
466,219
Shareholders' equity:
Common stock - par value $1; 5,000,000
shares
authorized; 2,545,776 shares issued
(*)
2,546
2,546
2,546
Additional paid-in capital
18,419
18,419
18,707
Retained earnings
26,758
24,841
23,315
Accumulated other comprehensive income
(664)
(2,187)
(2,634)
Total shareholders' equity
47,059
43,619
41,934
Total liabilities and shareholders'
equity
$
552,475
$
534,833
$
508,153
* Common stock - shares outstanding
2,545,776
2,545,776
2,545,776
SOUTHWEST GEORGIA FINANCIAL
CORPORATION
CONSOLIDATED INCOME STATEMENT
(unaudited*)
(Dollars in thousands except
per share data)
For the Three Months
For the Six Months
Ended June 30,
Ended June 30,
2019*
2018*
2019*
2018*
Interest income:
Interest and fees on loans
$
5,327
$
4,472
$
10,449
$
8,765
Interest and dividend on securities
available for sale
415
363
791
693
Interest on securities held to
maturity
237
262
487
540
Dividends on Federal Home Loan Bank
stock
21
35
48
68
Interest on deposits in banks
130
148
300
266
Interest on certificates of deposit in
other banks
17
12
34
23
Total interest income
6,147
5,292
12,109
10,355
Interest expense:
Interest on deposits
975
481
2,025
854
Interest on federal funds purchased
0
0
0
0
Interest on other borrowings
37
117
73
233
Interest on long-term debt
83
127
193
252
Total interest expense
1,095
725
2,291
1,339
Net interest income
5,052
4,567
9,818
9,016
Provision for loan losses
250
140
366
356
Net interest income after provision for
losses on loans
4,802
4,427
9,452
8,660
Noninterest income:
Service charges on deposit accounts
230
266
468
491
Income from trust services
55
63
112
122
Income from retail brokerage services
88
97
195
185
Income from insurance services
456
417
893
805
Income from mortgage banking services
0
1
0
1
Net gain (loss) on the sale or disposition
of assets
244
7
245
0
Net gain on extinguishment of debt
0
0
143
0
Other income
234
209
489
450
Total noninterest income
1,307
1,060
2,545
2,054
Noninterest expense:
Salary and employee benefits
2,584
2,388
5,081
4,729
Occupancy expense
319
295
633
584
Equipment expense
311
187
618
377
Data processing expense
405
351
809
705
Amortization of intangible assets
0
4
4
8
Other operating expense
931
907
1,821
1,724
Total noninterest expense
4,550
4,132
8,966
8,127
Income before income tax expense
1,559
1,355
3,031
2,587
Provision for income taxes
261
207
504
207
Net income
$
1,298
$
1,148
$
2,527
$
2,380
Net income per share, basic
$
0.51
$
0.45
$
0.99
$
0.93
Net income per share, diluted
$
0.51
$
0.45
$
0.99
$
0.93
Dividends paid per share
$
0.12
$
0.12
$
0.24
$
0.23
Basic weighted average shares
outstanding
2,545,776
2,545,776
2,545,776
2,545,351
Diluted weighted average shares
outstanding
2,545,776
2,545,776
2,545,776
2,545,351
SOUTHWEST GEORGIA FINANCIAL
CORPORATION
Financial Highlights
(Dollars in thousands except
per share data)
At June 30
2019
2018
Assets
$
552,475
$
508,153
Loans, less unearned income &
discount
$
388,268
$
345,852
Deposits
$
467,637
$
415,437
Shareholders' equity
$
47,058
$
41,934
Three Months Ended June 30,
Six Months Ended June 30,
2019
2018
2019
2018
Performance Data & Ratios
Net income
$
1,298
$
1,148
$
2,527
$
2,380
Earnings per share, basic
$
0.51
$
0.45
$
0.99
$
0.93
Earnings per share, diluted
$
0.51
$
0.45
$
0.99
$
0.93
Dividends paid per share
$
0.12
$
0.12
$
0.24
$
0.23
Return on assets
0.95%
0.91%
0.93%
0.95%
Return on equity
11.27%
11.00%
11.17%
11.44%
Net interest margin (tax equivalent)
4.06%
3.96%
3.68%
3.97%
Dividend payout ratio
23.53%
24.42%
24.18%
24.60%
Efficiency ratio
70.70%
71.10%
71.62%
71.01%
Asset Quality Data & Ratios
Total nonperforming loans
$
1,609
$
1,720
$
1,609
$
1,720
Total nonperforming assets
$
1,647
$
1,758
$
1,647
$
1,758
Net loan charge offs (recoveries)
$
152
$
118
$
330
$
206
Reserve for loan losses to total loans
0.89%
0.92%
0.89%
0.92%
Nonperforming loans/total loans
0.41%
0.50%
0.41%
0.50%
Nonperforming assets/total assets
0.30%
0.35%
0.30%
0.35%
Net charge offs (recoveries) / average
loans
0.16%
0.14%
0.17%
0.12%
Capital Ratios
Average common equity to average total
assets
8.45%
8.28%
8.32%
8.31%
Common equity Tier 1 capital ratio
12.18%
12.68%
12.18%
12.68%
Tier 1 capital ratio
12.18%
12.68%
12.18%
12.68%
Tier 1 leverage ratio
8.76%
8.81%
8.76%
8.81%
Total risk based capital ratio
13.07%
13.59%
13.07%
13.59%
Book value per share
$
18.48
$
16.47
$
18.48
$
16.47
Tangible book value per share
$
18.48
$
16.47
$
18.48
$
16.47
Quarterly
2nd Qtr
1st Qtr
4th Qtr
3rd Qtr
2nd Qtr
Averages
2019
2019
2018
2018
2018
Assets
$ 545,292
$ 542,361
$ 530,054
$ 509,416
$ 504,308
Loans, less unearned income &
discount
$ 383,167
$ 377,995
$ 373,324
$ 356,981
$ 337,092
Deposits
$ 476,529
$ 469,726
$ 444,256
$ 417,092
$ 412,133
Equity
$ 46,067
$ 44,431
$ 42,887
$ 42,581
$ 41,747
Return on assets
0.95%
0.91%
0.85%
0.90%
0.91%
Return on equity
11.27%
11.06%
10.48%
10.74%
11.00%
Net income
$ 1,298
$ 1,229
$ 1,123
$ 1,144
$ 1,148
Net income per share, basic
$ 0.51
$ 0.48
$ 0.44
$ 0.45
$ 0.45
Net income per share, diluted
$ 0.51
$ 0.48
$ 0.44
$ 0.45
$ 0.45
Dividends paid per share
$ 0.12
$ 0.12
$ 0.12
$ 0.12
$ 0.12
View source
version on businesswire.com: https://www.businesswire.com/news/home/20190723005116/en/
Company: Karen T. Boyd Senior Vice President and
Treasurer Phone: (229) 873-3837 investorinfo@sgfc.com
Investor Relations: Deborah K. Pawlowski Kei Advisors LLC
Phone: (716) 843-3908 dpawlowski@keiadvisors.com
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