Financial Data and Key Metrics Changes - Operating net income increased by $252,000 from the prior quarter, attributed to higher net interest income and operating non-interest income, offset by increased provision and operating non-interest expenses [14] - Net interest income rose by $314,000 compared to the prior quarter, driven by continued asset repricing and loan growth [14] - Net interest margin increased by five basis points from the prior quarter, with expectations for further growth due to the Fed rate cuts [15][14] - Tangible book value per share increased to $14.20 from $12.76 a year ago, reflecting consistent growth in tangible capital [23] Business Line Data and Key Metrics Changes - Non-interest income increased over $1 million from the prior quarter, with significant contributions from service charge and fee income, as well as interchange income [6][16] - Mortgage and government-guaranteed lending (SBSL) activity slowed, with mortgage production down slightly compared to the second quarter [23] - Pre-tax income for both merchant services and Colony Wealth Advisors increased significantly from the prior quarter, indicating strong performance in these business lines [24] Market Data and Key Metrics Changes - Loan growth for the quarter was around 9% annualized, lower than the first and second quarters, but still around a 14% annualized growth rate for the year [5] - Total deposits increased by $28.1 million during the quarter, reflecting strategic use of brokered funding [21] Company Strategy and Development Direction - The company is focused on strategic investments for future growth while maintaining margin improvement [5] - The pending merger with TC Bancshares, Inc. and TC Federal Bank is progressing as planned, with expectations for closure in the fourth quarter [9][10] - The company is optimistic about future M&A opportunities and is actively seeking strategic fits [10][11] Management's Comments on Operating Environment and Future Outlook - Management does not foresee a material impact from the government shutdown on the business or credit quality, although they are monitoring the situation closely [8][28] - The company expects loan growth to moderate but remain within the long-term target of 8% to 12% annually [5][6] - Management expressed confidence in balancing cost control with strategic investments for long-term growth [17] Other Important Information - Operating expenses increased by $624,000 quarter over quarter due to investments in talent and growth initiatives [16] - A wire fraud incident resulted in a recognized loss of $1.25 million related to disputed insurance coverage [18] Q&A Session Summary Question: Given the disruption in D.C., are there any impacts on borrowers and the local economy? - Management does not see a significant impact at this time and has provided resources to customers to mitigate potential issues [28] Question: What is the average roll-on versus roll-rate this quarter, and how does the NIM outlook look? - The roll-off yields were in the 5% range, with a new and renewed rate of 7.83% for the quarter, indicating potential for net interest margin growth [29][30] Question: Is there any NDFI loan exposure? - Management confirmed there is no meaningful exposure to NDFI loans, focusing instead on relationship-based lending [31]

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Financial Performance - Colony Bankcorp reported net income of $5.82 million, with adjusted earnings per share of $0.47 for the third quarter of 2025[22] - The company's net interest margin expanded for the fourth consecutive quarter, reaching 3.17%[23] - The operating return on average assets improved to 1.06%, and the operating return on average equity was 11.03%[23] - Tangible book value per common share increased to $14.20[23] Growth and Expansion - Loans increased by $43.5 million, representing an annualized growth rate of 9%[23] - Total deposits increased by $28.1 million[23] - The company expects to return to an 8-12% organic growth run rate by the end of 2025[38] Mergers and Acquisitions - Colony Bankcorp is set to merge with TC Bancshares, Inc, with pro forma assets reaching $3.8 billion[44] - The implied aggregate transaction value is $86.1 million, or $21.73 per TC Bancshares common share[44] - The acquisition is estimated to result in FY2026 and FY2027 EPS accretion of approximately 8.5% and 11.9%, respectively[44] Liquidity and Capital - Total liquidity sources as of September 30, 2025, amounted to $1.3034 billion[58]

[Third Quarter 2025 Earnings Release Highlights](index=1&type=section&id=Third%20Quarter%202025%20Earnings%20Release%20Highlights) Colony Bankcorp announced its Q3 2025 financial results, declared a dividend, and provided CEO commentary on strong performance and merger progress [Announcement and Dividend Declaration](index=1&type=section&id=Announcement%20and%20Dividend%20Declaration) Colony Bankcorp, Inc. reported its third quarter 2025 financial results and declared a quarterly cash dividend of $0.1150 per share, payable on November 19, 2025 - The Board of Directors declared a quarterly cash dividend of **$0.1150 per share**, to be paid on November 19, 2025, to shareholders of record as of November 5, 2025[4](index=4&type=chunk) - The Company had **17,461,284 shares** of its common stock outstanding as of October 20, 2025[4](index=4&type=chunk) [CEO Commentary](index=1&type=section&id=CEO%20Commentary) CEO Heath Fountain highlighted strong third-quarter performance driven by increased operating revenue, net interest margin expansion, and robust noninterest income. He noted strong loan growth, which is now moderating, and confirmed the smooth progress of the planned merger with TC Federal Bank - The Company's financial performance was highlighted by an increase in operating revenue, driven by consecutive net interest margin expansion and strong noninterest income[5](index=5&type=chunk) - Loan growth has been strong this year, reflecting healthy customer demand, and is now moderating to a normalized pace consistent with the Company's growth strategy[5](index=5&type=chunk) - The planned merger with TC Federal Bank is progressing smoothly, with an anticipated closing in the fourth quarter of 2025 and systems conversion in the first quarter of next year[5](index=5&type=chunk) - Strategic investment in talent, including the addition of experienced bankers, is expected to deliver significant long-term value to shareholders[7](index=7&type=chunk) [Financial Highlights Summary](index=1&type=section&id=Financial%20Highlights%20Summary) Key financial metrics for Q3 2025 showed a decrease in GAAP net income and diluted EPS quarter-over-quarter, but an increase in operating net income and adjusted diluted EPS. Loan and deposit balances grew, while mortgage production slightly decreased, and Small Business Specialty Lending (SBSL) loan originations significantly increased Key Financial Metrics | Metric | Q3 2025 | Q2 2025 | Q3 2024 | | :-------------------------------- | :-------- | :-------- | :-------- | | Net income | $5.8 million | $8.0 million | $5.6 million | | Diluted EPS | $0.33 | $0.46 | $0.32 | | Operating net income | $8.2 million | $8.0 million | $6.2 million | | Adjusted diluted EPS | $0.47 | $0.46 | $0.35 | | Provision for credit losses | $900,000 | $450,000 | $750,000 | | Total loans (excl. HFS) | $2.04 billion | N/A | N/A | | Total deposits | $2.58 billion | $2.56 billion | N/A | | Mortgage production | $87.3 million | $94.9 million | N/A | | Mortgage sales | $65.1 million | $65.3 million | N/A | | SBSL loans closed | $28.4 million | $15.8 million | N/A | | SBSL loans sold | $18.2 million | $17.9 million | N/A | - Total loans, excluding loans held for sale, increased by **$43.5 million (2.18%)** from the prior quarter to **$2.04 billion** at September 30, 2025[6](index=6&type=chunk) - Total deposits increased by **$28.1 million** from the prior quarter, reaching **$2.58 billion** at September 30, 2025[6](index=6&type=chunk) [Detailed Financial Review](index=2&type=section&id=Detailed%20Financial%20Review) This section provides an in-depth analysis of the company's balance sheet, capital position, operational results, and asset quality for the third quarter of 2025 [Balance Sheet Overview](index=2&type=section&id=Balance%20Sheet) Colony Bankcorp's balance sheet at September 30, 2025, showed growth in total assets, loans, and deposits compared to the prior quarter. Deposit composition shifted, with an increase in time deposits offsetting decreases in interest-bearing demand and savings/money market deposits Balance Sheet Summary | Metric | Sep 30, 2025 | Jun 30, 2025 | Change QoQ | | :-------------------------- | :----------- | :----------- | :--------- | | Total assets | $3.15 billion | $3.11 billion | +$37.1 million | | Total loans (excl. HFS) | $2.04 billion | $1.99 billion | +$43.5 million | | Total deposits | $2.58 billion | $2.56 billion | +$28.1 million | | Total borrowings | $248.1 million | $248.077 million | +$23,000 | - From June 30, 2025, to September 30, 2025, interest-bearing demand deposits decreased by **$27.5 million**, and savings and money market deposits decreased by **$22.8 million**, while time deposits increased by **$71.1 million**[9](index=9&type=chunk) - Total deposits increased by **$59.4 million** from September 30, 2024, driven by increases in interest-bearing demand deposits (**$41.9 million**) and time deposits (**$55.3 million**), partially offset by a decrease in savings and money market deposits (**$40.1 million**)[9](index=9&type=chunk) [Capital Position](index=2&type=section&id=Capital) Colony Bankcorp maintained a strong capital position in Q3 2025, with all preliminary capital ratios exceeding regulatory minimums for a 'well-capitalized' institution - Colony continues to maintain a strong capital position, with ratios that exceed regulatory minimums required to be considered as 'well-capitalized'[9](index=9&type=chunk) Capital Ratios | Capital Ratio | Sep 30, 2025 (Preliminary) | | :-------------------------- | :------------------------- | | Tier one leverage ratio | 9.91% | | Tier one capital ratio | 13.44% | | Total risk-based capital ratio | 16.00% | | Common equity tier one capital ratio | 12.37% | [Results of Operations](index=2&type=section&id=Third%20Quarter%202025%20Results%20of%20Operations) Net interest income and net interest margin significantly expanded year-over-year for both the third quarter and the nine months ended September 30, 2025, primarily due to increased income on interest-earning assets and decreased expense on interest-bearing liabilities. Noninterest income remained stable, while noninterest expenses increased due to higher personnel, IT, and acquisition-related costs, along with a wire fraud loss Net Interest Income and Margin (Q3) | Metric (Tax-Equivalent Basis) | Q3 2025 | Q3 2024 | Change | | :-------------------------------- | :----------- | :----------- | :------- | | Net interest income | $22.9 million | $18.7 million | +$4.2 million | | Net interest margin | 3.17% | 2.64% | +0.53% | Net Interest Income and Margin (9M) | Metric (Tax-Equivalent Basis) | 9M 2025 | 9M 2024 | Change | | :-------------------------------- | :----------- | :----------- | :------- | | Net interest income | $66.6 million | $56.1 million | +$10.5 million | | Net interest margin | 3.07% | 2.67% | +0.40% | - Noninterest income for Q3 2025 totaled **$10.1 million**, a slight increase of **$9,000 (0.09%)** compared to Q3 2024, driven by increases in service charges on deposits, mortgage fee income, and insurance commissions, partially offset by decreases in gains on SBA loan sales and increased losses on investment securities sales[9](index=9&type=chunk) - Noninterest expense for Q3 2025 totaled **$24.6 million**, an increase of **$3.8 million** compared to Q3 2024, primarily due to higher salaries and employee benefits, occupancy and equipment, information technology expenses, professional fees, acquisition-related expenses, and a loss from a wire fraud incident[9](index=9&type=chunk) [Asset Quality](index=3&type=section&id=Asset%20Quality) Asset quality metrics showed an increase in nonperforming assets and net loan charge-offs in Q3 2025 compared to the prior quarter, while the credit loss reserve slightly decreased Asset Quality Metrics | Metric | Sep 30, 2025 | Jun 30, 2025 | Change QoQ | | :-------------------------- | :----------- | :----------- | :--------- | | Nonperforming assets (NPAs) | $15.2 million | $11.4 million | +$3.8 million | | Other real estate owned and repossessed assets | $870,000 | $731,000 | +$139,000 | | Net loans charged-off | $1.8 million (0.36% of avg loans) | $1.0 million (0.21% of avg loans) | +$0.8 million | | Credit loss reserve | $18.1 million (0.89% of total loans) | $19.2 million (0.96% of total loans) | -$1.1 million | [Non-GAAP Financial Measures](index=5&type=section&id=Non-GAAP%20Financial%20Measures) This section defines and reconciles non-GAAP financial measures, offering supplemental insights into the company's core operating performance by excluding specific non-recurring items [Definition and Purpose](index=5&type=section&id=Explanation%20of%20Certain%20Unaudited%20Non-GAAP%20Financial%20Measures) This section defines various non-GAAP financial measures used by management, such as operating net income and adjusted earnings per diluted share, which exclude specific non-recurring or non-core items. These measures are intended to provide supplemental information for a clearer understanding of the Company's performance and facilitate comparisons, but are not a substitute for GAAP - Non-GAAP financial measures like operating noninterest income, operating net income, and adjusted earnings per diluted share are used by management to analyze performance and provide useful supplemental information to investors[21](index=21&type=chunk)[22](index=22&type=chunk) - These measures exclude items such as acquisition-related expenses, severance costs, losses on sales of securities, and losses related to wire fraud incidents to better reflect core operating performance[21](index=21&type=chunk) - While enhancing understanding of business and performance trends, these non-GAAP disclosures should not be considered an alternative to GAAP[22](index=22&type=chunk)[23](index=23&type=chunk) [Reconciliation of Non-GAAP Measures](index=6&type=section&id=Reconciliation%20of%20Non-GAAP%20Measures) Detailed reconciliations are provided for various non-GAAP measures, illustrating the adjustments made from their GAAP counterparts. These adjustments primarily involve adding back or subtracting non-recurring items like losses on securities sales, acquisition-related expenses, and wire fraud losses to derive operating metrics Operating Noninterest Income Reconciliation ($ thousands) | Metric | Q3 2025 | Q3 2024 | | :------------------------ | :-------- | :-------- | | Noninterest income (GAAP) | $10,091 | $10,082 | | Loss on sales of securities | 1,039 | 454 | | Operating noninterest income | $11,130 | $10,536 | Operating Net Income and Adjusted EPS Reconciliation ($ thousands) | Metric | Q3 2025 | Q3 2024 | | :-------------------------------- | :-------- | :-------- | | Net income (GAAP) | $5,819 | $5,629 | | Acquisition-related expenses | 732 | — | | Loss related to wire fraud incident | 1,252 | — | | Loss on sales of securities | 1,039 | 454 | | Income tax benefit | (612) | (143) | | Operating net income | $8,230 | $6,205 | | Adjusted earnings per diluted share | $0.47 | $0.35 | Operating Efficiency Ratio Reconciliation | Metric | Q3 2025 | Q3 2024 | | :------------------------ | :------ | :------ | | Efficiency ratio (GAAP) | 75.06% | 72.79% | | Acquisition-related expenses | (1.98)% | — | | Loss related to wire fraud incident | (3.38)% | — | | Loss on sales of securities | (2.81)% | (1.59)% | | Operating efficiency ratio | 66.89% | 70.27% | [Supplemental Financial Tables](index=8&type=section&id=Supplemental%20Financial%20Tables) This section presents comprehensive financial tables, including selected information, average balance sheets, segment performance, and consolidated statements, detailing the company's financial position and results [Selected Financial Information (Summary)](index=8&type=section&id=Selected%20Financial%20Information) This section provides a summary of key earnings, performance measures, asset quality, and balance sheet actual and average balances for recent quarters, highlighting trends in profitability, efficiency, and asset health Key Earnings and Performance Measures ($ thousands) | Metric | Q3 2025 | Q3 2024 | | :------------------------ | :-------- | :-------- | | Net interest income | $22,699 | $18,541 | | Provision for credit losses | 900 | 750 | | Noninterest income | 10,091 | 10,082 | | Noninterest expense | 24,612 | 20,835 | | Net income | $5,819 | $5,629 | Key Performance Ratios | Metric | Q3 2025 | Q3 2024 | | :------------------------ | :------ | :------ | | Diluted EPS | $0.33 | $0.32 | | Adjusted diluted EPS | $0.47 | $0.35 | | Net interest margin | 3.17% | 2.64% | | Operating efficiency ratio | 66.89% | 70.27% | Asset Quality and Balance Sheet Highlights ($ thousands) | Metric | Sep 30, 2025 | Sep 30, 2024 | | :-------------------------------- | :----------- | :----------- | | Total nonperforming assets (NPAs) | $15,236 | $12,495 | | Net loan charge-offs (recoveries) | $1,827 | $139 | | Allowance for credit losses to total loans | 0.89% | 1.04% | | Total assets | $3,152,746 | $3,065,103 | | Loans, net of unearned income | $2,037,056 | $1,886,037 | | Total stockholders' equity | $302,332 | $276,052 | [Average Balance Sheet and Net Interest Analysis](index=10&type=section&id=Average%20Balance%20Sheet%20and%20Net%20Interest%20Analysis) This analysis details the average balances of interest-earning assets and interest-bearing liabilities, along with their corresponding income, expense, yields, and rates for the three and nine months ended September 30, 2025, compared to the same periods in 2024. It highlights the drivers behind changes in net interest income and net interest margin Average Balance Sheet and Net Interest Analysis (Q3) ($ thousands) | Metric | Q3 2025 | Q3 2024 | | :-------------------------------- | :-------- | :-------- | | Total interest-earning assets (Avg Balances) | $2,864,190 | $2,820,071 | | Total interest income | $37,080 | $34,768 | | Total interest-bearing liabilities (Avg Balances) | $2,349,474 | $2,311,405 | | Total interest expense | $14,193 | $16,063 | | Net interest income | $22,887 | $18,705 | | Net interest margin | 3.17% | 2.64% | Average Balance Sheet and Net Interest Analysis (9M) ($ thousands) | Metric | 9M 2025 | 9M 2024 | | :-------------------------------- | :-------- | :-------- | | Total interest-earning assets (Avg Balances) | $2,899,583 | $2,806,412 | | Total interest income | $109,816 | $101,760 | | Total interest-bearing liabilities (Avg Balances) | $2,380,461 | $2,288,696 | | Total interest expense | $43,216 | $45,646 | | Net interest income | $66,600 | $56,114 | | Net interest margin | 3.07% | 2.67% | [Segment Reporting](index=12&type=section&id=Segment%20Reporting) The segment reporting provides a breakdown of financial performance for the Banking, Mortgage Banking, and Small Business Specialty Lending divisions. The Banking Division showed strong growth in net interest income and segment income, while Mortgage Banking experienced a loss in Q3 2025. The SBSL Division saw a decrease in net interest income and segment income year-over-year Banking Division Performance ($ thousands) | Metric | Banking Division Q3 2025 | Banking Division Q3 2024 | | :------------------------ | :----------------------- | :----------------------- | | Net interest income | $21,629 | $17,152 | | Segment income | $5,656 | $3,856 | | Total segment assets | $3,046,699 | $2,955,145 | Mortgage Banking Division Performance ($ thousands) | Metric | Mortgage Banking Division Q3 2025 | Mortgage Banking Division Q3 2024 | | :------------------------ | :-------------------------------- | :-------------------------------- | | Net interest income | $62 | $67 | | Segment income | $(126) | $275 | | Total segment assets | $12,959 | $9,300 | Small Business Specialty Lending Division Performance ($ thousands) | Metric | Small Business Specialty Lending Division Q3 2025 | Small Business Specialty Lending Division Q3 2024 | | :------------------------ | :---------------------------------------- | :---------------------------------------- | | Net interest income | $1,008 | $1,322 | | Segment income | $289 | $1,498 | | Total segment assets | $93,088 | $100,658 | [Consolidated Balance Sheets](index=13&type=section&id=Consolidated%20Balance%20Sheets) The consolidated balance sheet shows an increase in total assets, loans (net), and total stockholders' equity at September 30, 2025, compared to December 31, 2024. Total deposits also increased, while investment securities (available for sale and held to maturity) decreased Consolidated Balance Sheet Summary ($ thousands) | Asset/Liability/Equity | Sep 30, 2025 | Dec 31, 2024 | | :-------------------------------- | :----------- | :----------- | | Total assets | $3,152,746 | $3,109,782 | | Loans, net | $2,018,970 | $1,824,000 | | Total deposits | $2,584,329 | $2,567,943 | | Total liabilities | $2,850,414 | $2,831,107 | | Total stockholders' equity | $302,332 | $278,675 | [Consolidated Statements of Income](index=14&type=section&id=Consolidated%20Statements%20of%20Income%20(unaudited)) The consolidated statements of income show an increase in net interest income and net income for both the three and nine months ended September 30, 2025, compared to the prior year. Total interest income increased while total interest expense decreased. Noninterest income remained relatively stable, but noninterest expenses rose Consolidated Income Statement (Q3) ($ thousands) | Metric | Q3 2025 | Q3 2024 | | :------------------------ | :-------- | :-------- | | Total interest income | $36,892 | $34,604 | | Total interest expense | $14,193 | $16,063 | | Net interest income | $22,699 | $18,541 | | Net income | $5,819 | $5,629 | | Diluted EPS | $0.33 | $0.32 | Consolidated Income Statement (9M) ($ thousands) | Metric | 9M 2025 | 9M 2024 | | :------------------------ | :-------- | :-------- | | Total interest income | $109,252 | $101,250 | | Total interest expense | $43,216 | $45,646 | | Net interest income | $66,036 | $55,604 | | Net income | $20,410 | $16,436 | | Diluted EPS | $1.17 | $0.94 | Quarterly Net Income and EPS ($ thousands) | Metric | Q3 2025 | Q2 2025 | Q1 2025 | Q4 2024 | Q3 2024 | | :------------------------ | :-------- | :-------- | :-------- | :-------- | :-------- | | Net income | $5,819 | $7,978 | $6,613 | $7,432 | $5,629 | | Diluted EPS | $0.33 | $0.46 | $0.38 | $0.42 | $0.32 | [Quarterly Deposits Comparison](index=16&type=section&id=Quarterly%20Deposits%20Composition%20Comparison) Quarterly deposit data shows a slight increase in total deposits from Q2 2025 to Q3 2025, primarily driven by a significant increase in 'Other time' deposits and brokered deposits, while interest-bearing demand and savings/money market deposits decreased Deposit Composition by Type ($ thousands) | Deposit Type | Q3 2025 | Q2 2025 | Q3 2024 | | :-------------------------- | :-------- | :-------- | :-------- | | Noninterest-bearing demand | $442,142 | $434,785 | $439,892 | | Interest-bearing demand | $811,031 | $838,540 | $769,123 | | Savings and money markets | $644,312 | $667,135 | $684,371 | | Time over $250,000 | $192,545 | $193,427 | $198,942 | | Other time | $494,299 | $422,343 | $432,642 | | Total | $2,584,329 | $2,556,230 | $2,524,970 | Deposit Composition by Location ($ thousands) | Location | Q3 2025 | Q2 2025 | Q3 2024 | | :------------------------ | :-------- | :-------- | :-------- | | South Georgia | $1,205,891 | $1,203,732 | $1,165,529 | | Brokered deposits | $130,000 | $59,494 | $70,999 | | Reciprocal deposits | $204,039 | $206,011 | $197,460 | [Quarterly Loans Comparison](index=16&type=section&id=Quarterly%20Loan%20Comparison) Total loans, net of unearned income, continued to grow quarter-over-quarter and year-over-year. Growth was notable in construction, land & land development, residential real estate, and consumer and other loans, particularly in Florida and Marine/RV Lending segments Loan Portfolio Summary ($ thousands) | Loan Type | Q3 2025 | Q2 2025 | Q3 2024 | | :------------------------ | :-------- | :-------- | :-------- | | Core | $1,935,648 | $1,887,456 | $1,759,600 | | Purchased | $101,408 | $106,124 | $126,437 | | Loans, net of unearned income | $2,037,056 | $1,993,580 | $1,886,037 | Loan Composition by Type ($ thousands) | Loan Composition | Q3 2025 | Q2 2025 | Q3 2024 | | :-------------------------------- | :-------- | :-------- | :-------- | | Construction, land & land development | $240,819 | $238,078 | $196,390 | | Residential real estate | $377,058 | $356,515 | $349,777 | | Consumer and other | $140,921 | $126,966 | $85,015 | Loan Composition by Location ($ thousands) | Location | Q3 2025 | Q2 2025 | Q3 2024 | | :------------------------ | :-------- | :-------- | :-------- | | Florida | $26,061 | $24,562 | $12,280 | | Marine/RV Lending | $88,968 | $75,649 | $45,785 | [Classified and Criticized Loans](index=18&type=section&id=Classified%20Loans) Classified loans decreased slightly quarter-over-quarter but increased year-over-year, with a notable rise in construction, land & land development classified loans. Criticized loans increased both quarter-over-quarter and year-over-year, with significant increases in construction, land & land development and commercial, financial & agricultural categories Classified Loans Summary ($ thousands) | Loan Type | Q3 2025 | Q2 2025 | Q3 2024 | | :-------------------------------- | :-------- | :-------- | :-------- | | Construction, land & land development | $1,644 | $126 | $0 | | Commercial, financial & agricultural | $7,947 | $7,071 | $6,005 | | TOTAL Classified Loans | $24,183 | $25,112 | $20,918 | | Classified loans to total loans | 1.19% | 1.26% | 1.11% | Criticized Loans Summary ($ thousands) | Loan Type | Q3 2025 | Q2 2025 | Q3 2024 | | :-------------------------------- | :-------- | :-------- | :-------- | | Construction, land & land development | $14,393 | $2,207 | $4,418 | | Commercial, financial & agricultural | $14,403 | $15,212 | $9,444 | | TOTAL Criticized Loans | $60,505 | $54,814 | $52,062 | | Criticized loans to total loans | 2.97% | 2.75% | 2.76% | [Corporate Information and Disclosures](index=3&type=section&id=Corporate%20Information%20and%20Disclosures) This section provides details on the earnings call, company background, cautionary forward-looking statements, and additional information regarding the proposed merger [Earnings Call Information](index=3&type=section&id=Earnings%20call%20information) Details for the upcoming earnings conference call to discuss Q3 2025 results are provided, including dial-in information and replay availability - An earnings conference call is scheduled for **9:00 a.m. ET on Thursday, October 23, 2025**, with a replay available until October 30, 2025[11](index=11&type=chunk) [About Colony Bankcorp](index=3&type=section&id=About%20Colony%20Bankcorp) Colony Bankcorp, Inc. is the holding company for Colony Bank, a Georgia-founded institution operating across multiple states, offering a broad range of personal and business banking solutions, including specialized services - Colony Bankcorp, Inc. (NYSE: CBAN) is the bank holding company for Colony Bank, founded in Fitzgerald, Georgia in 1975[12](index=12&type=chunk) - The bank operates locations throughout Georgia, as well as in Birmingham, Alabama; Tallahassee, Florida; and the Florida Panhandle[12](index=12&type=chunk) - Colony Bank offers a range of banking solutions including mortgage lending, government guaranteed lending, consumer insurance, wealth management, credit cards, and merchant services[12](index=12&type=chunk) [Forward-Looking Statements](index=3&type=section&id=Forward-Looking%20Statements) This section serves as a cautionary note regarding forward-looking statements, emphasizing that they are not guarantees of future performance and involve inherent risks and uncertainties. It lists various factors that could cause actual results to differ materially, including economic conditions, interest rate changes, regulatory actions, and risks associated with the proposed merger - Statements in the press release that are not historical facts are considered 'forward-looking statements' under federal securities laws[13](index=13&type=chunk) - These statements are not guarantees of future performance and involve known and unknown risks and uncertainties, including economic conditions, interest rate changes, and banking industry developments[14](index=14&type=chunk) - Specific risks related to the proposed merger with TC Bancshares include the realization of cost savings and synergies, integration challenges, and the ability to obtain necessary approvals[16](index=16&type=chunk) - The Company undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made, except as required by applicable law[17](index=17&type=chunk) [Additional Information About the Proposed Merger](index=4&type=section&id=Additional%20Information%20About%20the%20Proposed%20Merger%20and%20Where%20to%20Find%20It) This section advises investors to review SEC filings, particularly the Form S-4 registration statement and joint proxy statement/prospectus, for comprehensive information regarding the proposed merger with TC Bancshares. It also identifies potential participants in the proxy solicitation - Investors and security holders are urged to read the registration statement on Form S-4, including the joint proxy statement/prospectus, and other relevant documents filed with the SEC concerning the proposed merger[18](index=18&type=chunk)[19](index=19&type=chunk) - Free copies of these documents are available through the SEC's website (www.sec.gov) and on Colony Bankcorp's investor relations website (colony.bank)[19](index=19&type=chunk) - Colony, TC Bancshares, and certain of their respective directors and executive officers may be deemed participants in the solicitation of proxies related to the Proposed Merger[20](index=20&type=chunk)

PART I – Financial Information [Item 1. Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) Presents Colony Bankcorp's unaudited consolidated financial statements for Q2 2025 and audited balance sheet for YE 2024, including detailed accounting notes [Consolidated Balance Sheets](index=4&type=section&id=Consolidated%20Balance%20Sheets) Consolidated Balance Sheets (in thousands) | Metric (in thousands) | June 30, 2025 (Unaudited) | December 31, 2024 (Audited) | | :--------------------------------------- | :-------------------------- | :-------------------------- | | **ASSETS** | | | | Cash and cash equivalents | $112,145 | $231,034 | | Investment securities available-for-sale | $373,572 | $366,049 | | Investment securities held-to-maturity | $409,634 | $430,077 | | Loans, net | $1,974,427 | $1,824,000 | | Total assets | $3,115,617 | $3,109,782 | | **LIABILITIES AND STOCKHOLDERS' EQUITY** | | | | Deposits | $2,556,230 | $2,567,943 | | Federal Home Loan Bank advances | $185,000 | $185,000 | | Total liabilities | $2,821,760 | $2,831,107 | | Total stockholders' equity | $293,857 | $278,675 | - Total assets remained stable at **$3.1 billion** at June 30, 2025, compared to December 31, 2024. Loans, net, increased by **$150.4 million (8.2%)** from **$1.82 billion** to **$1.97 billion**, while cash and cash equivalents decreased by **$118.9 million (51.5%)** from **$231.0 million** to **$112.1 million**[9](index=9&type=chunk)[72](index=72&type=chunk)[73](index=73&type=chunk) - Total deposits decreased by **$11.7 million (0.5%)** from **$2.57 billion** to **$2.56 billion**, primarily due to seasonality. Stockholders' equity increased by **$15.2 million (5.5%)** from **$278.7 million** to **$293.9 million**[9](index=9&type=chunk)[295](index=295&type=chunk) [Consolidated Statements of Income](index=5&type=section&id=Consolidated%20Statements%20of%20Income) Consolidated Statements of Income (in thousands, except per share) | Metric (in thousands, except per share) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net interest income | $22,385 | $18,409 | $43,337 | $37,063 | | Provision for credit losses | $450 | $650 | $1,950 | $1,650 | | Total noninterest income | $10,098 | $9,497 | $19,142 | $18,984 | | Total noninterest expense | $22,004 | $20,330 | $42,225 | $40,727 | | Net income | $7,978 | $5,474 | $14,591 | $10,807 | | Basic EPS | $0.46 | $0.31 | $0.83 | $0.62 | | Diluted EPS | $0.46 | $0.31 | $0.83 | $0.62 | | Dividends declared per share | $0.1150 | $0.1125 | $0.2300 | $0.2250 | - Net income increased by **45.7%** to **$8.0 million** for Q2 2025 compared to **$5.5 million** for Q2 2024. For the six months ended June 30, 2025, net income increased by **35.0%** to **$14.6 million** from **$10.8 million** in the prior year[11](index=11&type=chunk)[227](index=227&type=chunk)[238](index=238&type=chunk) - Basic and diluted EPS increased to **$0.46** for Q2 2025 from **$0.31** for Q2 2024, and to **$0.83** for the six months ended June 30, 2025, from **$0.62** for the same period in 2024[11](index=11&type=chunk)[227](index=227&type=chunk)[238](index=238&type=chunk) [Consolidated Statements of Comprehensive Income](index=6&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income) Consolidated Statements of Comprehensive Income (in thousands) | Metric (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net income | $7,978 | $5,474 | $14,591 | $10,807 | | Total other comprehensive income | $1,742 | $1,170 | $5,909 | $2,459 | | Comprehensive income | $9,720 | $6,644 | $20,500 | $13,266 | - Comprehensive income increased by **46.3%** to **$9.7 million** for Q2 2025 from **$6.6 million** for Q2 2024. For the six months ended June 30, 2025, comprehensive income increased by **54.5%** to **$20.5 million** from **$13.3 million** in the prior year[13](index=13&type=chunk) - Net unrealized gains on securities arising during the period significantly increased to **$1.4 million** for Q2 2025 from a loss of **$0.3 million** in Q2 2024, and to **$6.3 million** for the six months ended June 30, 2025, from a loss of **$1.1 million** in the prior year[13](index=13&type=chunk) [Consolidated Statements of Changes in Stockholder's Equity](index=7&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Stockholder%27s%20Equity) Consolidated Statements of Changes in Stockholder's Equity (in thousands) | Metric (in thousands) | Balance, December 31, 2024 | Balance, June 30, 2025 | | :--------------------- | :------------------------- | :--------------------- | | Common Stock | $17,520 | $17,417 | | Paid-In Capital | $168,353 | $167,160 | | Retained Earnings | $140,369 | $150,938 | | Accumulated Other Comprehensive Income (Loss) | $(47,567) | $(41,658) | | Total Stockholders' Equity | $278,675 | $293,857 | - Total stockholders' equity increased by **$15.2 million** to **$293.9 million** at June 30, 2025, from **$278.7 million** at December 31, 2024. This increase was primarily driven by net income of **$14.6 million** and other comprehensive income of **$5.9 million**, partially offset by dividends paid of **$4.0 million** and share repurchases of **$1.6 million**[17](index=17&type=chunk)[9](index=9&type=chunk) - The Company repurchased and retired **100,324 shares** for **$1.6 million** during the six months ended June 30, 2025[17](index=17&type=chunk) [Consolidated Statements of Cash Flows](index=9&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Consolidated Statements of Cash Flows (in thousands) | Metric (in thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--------------------- | :----------------------------- | :----------------------------- | | Net cash provided by operating activities | $33,788 | $6,149 | | Net cash provided by (used in) investing activities | $(135,276) | $51,852 | | Net cash used in financing activities | $(17,401) | $(59,321) | | Net decrease in cash and cash equivalents | $(118,889) | $(1,320) | | Cash and cash equivalents at end of period | $112,145 | $82,002 | - Net cash provided by operating activities significantly increased to **$33.8 million** for the six months ended June 30, 2025, from **$6.1 million** in the prior year, primarily due to higher net income and changes in other assets/liabilities[20](index=20&type=chunk) - Investing activities shifted from providing **$51.9 million** in cash in 2024 to using **$135.3 million** in 2025, mainly due to a **$153.1 million** change in loans, net (originations exceeding proceeds from sales)[20](index=20&type=chunk) - Financing activities used **$17.4 million** in cash for the six months ended June 30, 2025, a decrease from **$59.3 million** used in the prior year, driven by changes in customer deposits and FHLB advances[20](index=20&type=chunk) [Notes to Consolidated Financial Statements (Unaudited)](index=11&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements%20%28Unaudited%29) [ (1) Summary of Significant Accounting Policies](index=11&type=section&id=%281%29%20Summary%20of%20Significant%20Accounting%20Policies) - The Company is a bank holding company based in Fitzgerald, Georgia, offering a full range of retail, commercial, and mortgage banking services, government guaranteed lending, consumer insurance, wealth management, credit cards, and merchant services primarily in Georgia, Alabama, and Florida[25](index=25&type=chunk)[29](index=29&type=chunk) - Key accounting estimates include the allowance for credit losses, valuation of real estate acquired in foreclosures, and fair value of assets/liabilities in business combinations, including goodwill impairment[30](index=30&type=chunk) - Approximately **83%** of the Company's loan portfolio was concentrated in real estate loans at June 30, 2025, posing a credit risk dependent on the real estate economic sector[33](index=33&type=chunk) - The Company adopted ASU No. 2023-07 (Segment Reporting) for interim periods beginning January 1, 2025, with no material impact on financial statements, and is evaluating ASU No. 2023-09 (Income Taxes) for its annual report[59](index=59&type=chunk)[60](index=60&type=chunk) [ (2) Investment Securities](index=19&type=section&id=%282%29%20Investment%20Securities) Investment Securities (in thousands) | Metric (in thousands) | June 30, 2025 Amortized Cost | June 30, 2025 Fair Value | December 31, 2024 Amortized Cost | December 31, 2024 Fair Value | | :--------------------- | :--------------------------- | :----------------------- | :------------------------------- | :--------------------------- | | **Available-for-Sale** | | | | | | Total | $409,912 | $373,572 | $409,380 | $366,049 | | Gross Unrealized Gains | $714 | | $225 | | | Gross Unrealized Losses | $(37,054) | | $(43,556) | | | **Held-to-Maturity** | | | | | | Total | $409,634 | $369,103 | $430,077 | $383,020 | | Gross Unrealized Gains | $— | | $— | | | Gross Unrealized Losses | $(40,531) | | $(47,057) | | - The fair value of available-for-sale securities increased by **$7.5 million** to **$373.6 million** at June 30, 2025, from **$366.0 million** at December 31, 2024, while held-to-maturity securities decreased by **$13.9 million** to **$369.1 million** from **$383.0 million**[62](index=62&type=chunk) - Gross unrealized losses on available-for-sale securities decreased from **$(43.6) million** to **$(37.1) million**, and on held-to-maturity securities decreased from **$(47.1) million** to **$(40.5) million**, primarily due to increases in market interest rates[62](index=62&type=chunk)[76](index=76&type=chunk) - The Company had no sales of investment securities for the three and six months ended June 30, 2025, compared to gross realized losses of **$0.4 million** and **$1.0 million**, respectively, in 2024 from restructuring underperforming assets[67](index=67&type=chunk) [ (3) Loans](index=24&type=section&id=%283%29%20Loans) Loans (in thousands) | Metric (in thousands) | June 30, 2025 | December 31, 2024 | | :--------------------- | :------------ | :---------------- | | Construction, land & land development | $238,078 | $205,046 | | Other commercial real estate | $1,059,149 | $990,648 | | Residential real estate | $356,515 | $344,167 | | Commercial, financial & agricultural | $212,872 | $213,910 | | Consumer and other | $126,966 | $89,209 | | Total loans | $1,993,580 | $1,842,980 | - Gross loans outstanding increased by **$150.6 million (8.2%)** to **$1.99 billion** at June 30, 2025, from **$1.84 billion** at December 31, 2024. Commercial real estate loans constitute **65.1%** of the total loan portfolio[73](index=73&type=chunk)[74](index=74&type=chunk) - Nonaccrual loans decreased slightly to **$10.6 million** at June 30, 2025, from **$10.7 million** at December 31, 2024. Total nonperforming assets increased to **0.37%** of total assets at June 30, 2025, from **0.36%** at December 31, 2024[290](index=290&type=chunk)[293](index=293&type=chunk) - The Company had no loans modified due to financial difficulty during the three and six months ended June 30, 2025[110](index=110&type=chunk)[294](index=294&type=chunk) [ (4) Allowance for Credit Losses](index=38&type=section&id=%284%29%20Allowance%20for%20Credit%20Losses) Allowance for Credit Losses (in thousands) | Metric (in thousands) | June 30, 2025 | December 31, 2024 | | :--------------------- | :------------ | :---------------- | | Allowance for credit losses on loans | $19,153 | $18,980 | | Allowance for credit losses on unfunded commitments | $935 | $813 | | Total ACL | $20,088 | $19,793 | - The allowance for credit losses on loans increased to **$19.2 million** at June 30, 2025, from **$19.0 million** at December 31, 2024. As a percentage of total loans, it decreased to **0.96%** from **1.03%**[120](index=120&type=chunk)[229](index=229&type=chunk)[282](index=282&type=chunk) - Net charge-offs for the six months ended June 30, 2025, were **$1.7 million**, up from **$1.3 million** for the same period in 2024[229](index=229&type=chunk)[288](index=288&type=chunk) - The provision for credit losses for the six months ended June 30, 2025, was **$1.95 million**, including **$1.83 million** for loans and **$0.1 million** for unfunded commitments[250](index=250&type=chunk)[282](index=282&type=chunk) [ (5) Derivatives](index=40&type=section&id=%285%29%20Derivatives) - The Company uses interest rate swaps to manage interest rate risk, designating them as cash flow hedges for variable rate liabilities and fair value hedges for fixed rate assets[128](index=128&type=chunk)[131](index=131&type=chunk) - As of June 30, 2025, derivative assets totaled **$0.01 million** (all cash flow hedges), and derivative liabilities totaled **$0.56 million** (**$0.36 million** cash flow hedges, **$0.20 million** fair value hedges)[132](index=132&type=chunk) - Gains on swap transactions recognized as a component of interest expense were **$0.08 million** for Q2 2025 and **$0.16 million** for the six months ended June 30, 2025[133](index=133&type=chunk) [ (6) Borrowings](index=42&type=section&id=%286%29%20Borrowings) Borrowings (in thousands) | Metric (in thousands) | June 30, 2025 | December 31, 2024 | | :--------------------- | :------------ | :---------------- | | Federal Home Loan Bank advances | $185,000 | $185,000 | | Other borrowings | $63,086 | $63,039 | | Total borrowings | $248,086 | $248,039 | - FHLB advances remained stable at **$185.0 million**, with maturities ranging from 2025 to 2029 and interest rates from **3.69%** to **4.73%**. The Company had **$605.1 million** in remaining credit availability from the FHLB at June 30, 2025[138](index=138&type=chunk)[305](index=305&type=chunk) - Other borrowings include **$24.2 million** in debentures underlying trust preferred securities (Tier 1 capital) and **$38.9 million** in fixed-to-floating rate subordinated notes due 2032 (Tier 2 capital)[139](index=139&type=chunk)[140](index=140&type=chunk) - The Company has available federal funds lines of credit totaling **$114.5 million** and **$109.4 million** borrowing capacity from the Federal Reserve Bank, with no outstanding balances at June 30, 2025[141](index=141&type=chunk)[142](index=142&type=chunk)[306](index=306&type=chunk) [ (7) Earnings Per Share](index=44&type=section&id=%287%29%20Earnings%20Per%20Share) Earnings Per Share (in thousands, except per share) | Metric (in thousands, except per share) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net income available to common stockholders | $7,978 | $5,474 | $14,591 | $10,807 | | Basic EPS | $0.46 | $0.31 | $0.83 | $0.62 | | Diluted EPS | $0.46 | $0.31 | $0.83 | $0.62 | - Basic and diluted earnings per share increased to **$0.46** for the three months ended June 30, 2025, from **$0.31** in the prior year, and to **$0.83** for the six months ended June 30, 2025, from **$0.62** in the prior year[147](index=147&type=chunk) [ (8) Commitments and Contingencies](index=44&type=section&id=%288%29%20Commitments%20and%20Contingencies) Commitments and Contingencies (in thousands) | Metric (in thousands) | June 30, 2025 | December 31, 2024 | | :--------------------- | :------------ | :---------------- | | Loan commitments | $384,801 | $329,924 | | Letters of credit | $5,438 | $5,947 | - Loan commitments increased by **$54.9 million (16.6%)** to **$384.8 million** at June 30, 2025, from **$329.9 million** at December 31, 2024[150](index=150&type=chunk) - In March 2025, the Company experienced a wire fraud incident, but it did not impact customer accounts or data. The Company recognized a **$2.9 million** receivable for unrecovered funds, believing it is collectible under insurance policies[156](index=156&type=chunk)[157](index=157&type=chunk) - The Company is subject to various legal proceedings in the ordinary course of business, but management believes the aggregate liabilities would not have a material adverse effect on its financial position[155](index=155&type=chunk)[320](index=320&type=chunk) [ (9) Fair Value of Financial Instruments and Fair Value Measurements](index=46&type=section&id=%289%29%20Fair%20Value%20of%20Financial%20Instruments%20and%20Fair%20Value%20Measurements) - Fair value measurements are categorized into a three-level hierarchy: Level 1 (quoted prices in active markets), Level 2 (observable inputs other than Level 1), and Level 3 (unobservable inputs)[159](index=159&type=chunk) Fair Value of Financial Instruments and Fair Value Measurements (in thousands) | Metric (in thousands) | June 30, 2025 Fair Value | Level 1 | Level 2 | Level 3 | | :--------------------- | :----------------------- | :------ | :------ | :------ | | **Assets** | | | | | | Cash and short-term investments | $112,145 | $112,145 | $— | $— | | Investment securities available-for-sale | $373,572 | $— | $366,761 | $6,811 | | Loans, net | $1,876,358 | $— | $— | $1,876,358 | | **Liabilities** | | | | | | Deposits | $2,552,984 | $— | $2,552,984 | $— | | Federal Home Loan Bank advances | $184,233 | $— | $184,233 | $— | - Collateral-dependent loans and other real estate owned are classified as Level 3 fair values, with a **10%** discount rate applied to appraised values to reflect estimated selling costs and market conditions[178](index=178&type=chunk)[179](index=179&type=chunk)[186](index=186&type=chunk) [ (10) Segment Information](index=55&type=section&id=%2810%29%20Segment%20Information) - The Company operates in three reportable segments: Banking (full-service financial services), Mortgage Banking (residential mortgage loan origination and sales), and Small Business Specialty Lending Division (SBA and government guaranteed loans)[192](index=192&type=chunk) Segment Profit (Q2 2025, in thousands) | Metric (in thousands) | Bank Segment Profit (Q2 2025) | Mortgage Banking Segment Profit (Q2 2025) | Small Business Specialty Lending Division Profit (Q2 2025) | Total Segment Profit (Q2 2025) | | :--------------------- | :---------------------------- | :---------------------------------------- | :--------------------------------------------------------- | :----------------------------- | | Net Interest Income | $21,319 | $44 | $1,022 | $22,385 | | Total Noninterest Income | $5,969 | $1,984 | $2,145 | $10,098 | | Total Noninterest Expense | $18,269 | $1,710 | $2,025 | $22,004 | | Segment Profit | $7,441 | $249 | $288 | $7,978 | - For the six months ended June 30, 2025, the Bank segment generated **$13.6 million** in profit, Mortgage Banking **$0.3 million**, and Small Business Specialty Lending Division **$0.7 million**, totaling **$14.6 million**[197](index=197&type=chunk) - As of June 30, 2025, the Bank segment held **$3.01 billion** in assets, Mortgage Banking **$14.3 million**, and Small Business Specialty Lending Division **$90.9 million**, totaling **$3.12 billion**[197](index=197&type=chunk) [ (11) Regulatory Capital Matters](index=59&type=section&id=%2811%29%20Regulatory%20Capital%20Matters) - As of June 30, 2025, the Company and Colony Bank were categorized as 'well-capitalized' under regulatory frameworks, exceeding all minimum requirements[206](index=206&type=chunk)[309](index=309&type=chunk) Regulatory Capital Ratios (in thousands) | Metric (in thousands) | Actual Amount (Consolidated) | Actual Ratio (Consolidated) | Well Capitalized Ratio | | :--------------------- | :--------------------------- | :-------------------------- | :--------------------- | | Total Capital to Risk-Weighted Assets | $358,717 | 16.06% | 10.00% | | Tier 1 Capital to Risk-Weighted Assets | $299,773 | 13.42% | 8.00% | | Common Equity Tier 1 Capital to Risk-Weighted Assets | $275,544 | 12.34% | 6.50% | | Tier 1 Capital to Average Assets | $299,773 | 9.61% | 5.00% | - Consolidated Common Equity Tier 1 (CET1) risk-based capital ratio was **12.34%** at June 30, 2025, down from **13.08%** at December 31, 2024, but still well above the **6.50%** well-capitalized threshold[208](index=208&type=chunk)[311](index=311&type=chunk) [ (12) Subsequent Events](index=60&type=section&id=%2812%29%20Subsequent%20Events) - On July 22, 2025, the Board declared a quarterly cash dividend of **$0.1150 per share**, payable on August 20, 2025[211](index=211&type=chunk) - On July 23, 2025, the Company announced an agreement to acquire TC Bancshares, Inc. for approximately **$86.1 million** in a combined stock-and-cash transaction. The acquisition is expected to close in Q4 2025, subject to regulatory and shareholder approvals[212](index=212&type=chunk)[213](index=213&type=chunk)[222](index=222&type=chunk) - Upon completion, the combined organization is projected to have approximately **$3.8 billion** in total assets, **$2.4 billion** in total loans, and **$3.1 billion** in total deposits, and is expected to be immediately accretive to the Company's earnings per share (excluding transaction costs)[212](index=212&type=chunk)[222](index=222&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=62&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Analyzes Colony Bankcorp's financial condition and results of operations for Q2 2025 and YE 2024, focusing on performance drivers, accounting policies, liquidity, and capital [Forward-looking Statements](index=62&type=section&id=Forward-looking%20Statements) - The report contains forward-looking statements regarding future events, financial performance, and the proposed merger with TC Bancshares, Inc., which are subject to various risks and uncertainties[217](index=217&type=chunk) - Key risk factors include economic and market conditions (inflation, interest rates), geopolitical events, compliance with capital/liquidity requirements, credit quality of the loan portfolio (real estate concentration), and the ability to manage growth and operational efficiency[218](index=218&type=chunk)[219](index=219&type=chunk) - Risks related to the proposed TCBC merger include integration challenges, potential litigation, and the realization of expected cost savings and revenue synergies[220](index=220&type=chunk) [Proposed Acquisition of TC Bancshares, Inc. and TC Federal Bank](index=65&type=section&id=Proposed%20Acquisition%20of%20TC%20Bancshares%2C%20Inc.%20and%20TC%20Federal%20Bank) - Colony Bankcorp, Inc. announced the acquisition of TC Bancshares, Inc. for approximately **$86.1 million** in a combined stock-and-cash transaction, expected to close in Q4 2025[212](index=212&type=chunk)[222](index=222&type=chunk) - The combined entity is projected to have **$3.8 billion** in total assets, **$2.4 billion** in total loans, and **$3.1 billion** in total deposits, with the transaction expected to be immediately accretive to EPS (excluding transaction costs)[212](index=212&type=chunk)[222](index=222&type=chunk) - TCBC shareholders will receive either **$21.25** in cash or **1.25 shares** of Colony's common stock per share, subject to proration (**20%** cash, **80%** stock)[214](index=214&type=chunk)[225](index=225&type=chunk) [Overview](index=66&type=section&id=Overview) Overview - Balance Sheet | Metric | June 30, 2025 | December 31, 2024 | | :----- | :------------ | :---------------- | | Total consolidated assets | $3.1 billion | $3.1 billion | | Total loans, net | $2.0 billion | $1.8 billion | | Total deposits | $2.6 billion | $2.6 billion | | Stockholders' equity | $293.9 million | $278.7 million | Overview - Income Statement | Metric | Q2 2025 | Q2 2024 | YTD Q2 2025 | YTD Q2 2024 | | :----- | :------ | :------ | :---------- | :---------- | | Net income | $8.0 million | $5.5 million | $14.6 million | $10.8 million | | Diluted EPS | $0.46 | $0.31 | $0.83 | $0.62 | - The increase in net income for both the three and six months ended June 30, 2025, was primarily driven by higher interest income (loans, investments, deposits in banks) and noninterest income, coupled with a slight decrease in interest expense, partially offset by increased noninterest expense[227](index=227&type=chunk) [Critical Accounting Policies](index=67&type=section&id=Critical%20Accounting%20Policies) - Critical accounting policies include business combinations, allowance for credit losses (ACL), and income taxes, which require significant judgment and complex estimates[233](index=233&type=chunk) - The Company adopted ASU No. 2016-13 (CECL) on January 1, 2023, which changed the methodology for estimating credit losses from an 'incurred loss' to an 'expected loss' approach, considering past events, current conditions, and reasonable forecasts[235](index=235&type=chunk) - Management's evaluation of the ACL is a critical estimate, relying on credit risk ratings, expected future cash flows, historical loss rates, and qualitative/quantitative economic factors[236](index=236&type=chunk) [Results of Operations](index=68&type=section&id=Results%20of%20Operations) [ Net Interest Income](index=68&type=section&id=Net%20Interest%20Income) Net Interest Income | Metric | Q2 2025 | Q2 2024 | YTD Q2 2025 | YTD Q2 2024 | | :----- | :------ | :------ | :---------- | :---------- | | Fully taxable equivalent net interest income | $22.6 million | $18.6 million | $43.7 million | $37.4 million | | Net interest margin | 3.12% | 2.68% | 3.02% | 2.69% | - Net interest income (FTE) increased by **$4.0 million (21.5%)** for Q2 2025 and **$6.3 million (16.8%)** for YTD Q2 2025, driven by higher income on interest-earning assets and decreased expense on interest-bearing liabilities[228](index=228&type=chunk)[241](index=241&type=chunk) - The net interest margin improved to **3.12%** for Q2 2025 and **3.02%** for YTD Q2 2025, primarily due to increased rates on loans and taxable investment securities, and decreased rates paid on deposits and other borrowings[241](index=241&type=chunk) - The yield on total interest-bearing liabilities decreased from **2.64%** in Q2 2024 to **2.42%** in Q2 2025, and from **2.61%** to **2.44%** for the six-month periods, attributed to a **100 basis point** decrease in federal funds interest rate and low-cost deposit growth[243](index=243&type=chunk) [ Provision for Credit Losses](index=71&type=section&id=Provision%20for%20Credit%20Losses) Provision for Credit Losses (in thousands) | Metric (in thousands) | Q2 2025 | Q2 2024 | YTD Q2 2025 | YTD Q2 2024 | | :--------------------- | :------ | :------ | :---------- | :---------- | | Provision for credit losses | $450 | $650 | $2,000 | $1,700 | | - on loans | $205 | $816 | $1,830 | $1,800 | | - on unfunded commitments | $245 | $(166) | $122 | $(116) | - The provision for credit losses decreased for Q2 2025 to **$0.45 million** from **$0.65 million** in Q2 2024, but increased for YTD Q2 2025 to **$2.0 million** from **$1.7 million** in YTD Q2 2024[250](index=250&type=chunk) - The Q2 2025 provision included **$0.25 million** for unfunded commitments, compared to a release of **$0.17 million** in Q2 2024[250](index=250&type=chunk) [ Noninterest Income](index=72&type=section&id=Noninterest%20Income) Noninterest Income (in thousands) | Metric (in thousands) | Q2 2025 | Q2 2024 | Change (Amount, in thousands) | Change (%) | YTD Q2 2025 | YTD Q2 2024 | Change (Amount, in thousands) | Change (%) | | :--------------------- | :------ | :------ | :-------------- | :--------- | :---------- | :---------- | :-------------- | :--------- | | Total noninterest income | $10,098 | $9,497 | $601 | 6.3% | $19,142 | $18,984 | $158 | 0.8% | | Mortgage fee income | $1,984 | $1,442 | $542 | 37.6% | $3,563 | $2,691 | $872 | 32.4% | | Gain on sales of SBA loans | $1,550 | $2,347 | $(797) | (34.0)% | $2,585 | $4,393 | $(1,808) | (41.2)% | | Loss on sales of securities | $— | $(425) | $425 | 100.0% | $— | $(980) | $980 | (100.0)% | | Insurance commissions | $766 | $420 | $346 | 82.4% | $1,235 | $885 | $350 | 39.5% | - Noninterest income increased by **$0.6 million (6.3%)** for Q2 2025 and **$0.16 million (0.8%)** for YTD Q2 2025, primarily due to higher mortgage fee income and insurance commissions, and reduced losses on securities sales[230](index=230&type=chunk)[252](index=252&type=chunk) - Mortgage fee income increased significantly by **37.6%** for Q2 2025 and **32.4%** for YTD Q2 2025 due to higher mortgage production. Gains on sales of SBA loans decreased by **34.0%** and **41.2%** respectively, due to decreased production and sales[254](index=254&type=chunk)[255](index=255&type=chunk) - Insurance commissions increased by **82.4%** for Q2 2025 and **39.5%** for YTD Q2 2025, driven by volume and the acquisition of Ellerbee Insurance Agency[258](index=258&type=chunk) [ Noninterest Expense](index=73&type=section&id=Noninterest%20Expense) Noninterest Expense (in thousands) | Metric (in thousands) | Q2 2025 | Q2 2024 | Change (Amount, in thousands) | Change (%) | YTD Q2 2025 | YTD Q2 2024 | Change (Amount, in thousands) | Change (%) | | :--------------------- | :------ | :------ | :-------------- | :--------- | :---------- | :---------- | :-------------- | :--------- | | Total noninterest expense | $22,004 | $20,330 | $1,674 | 8.2% | $42,225 | $40,727 | $1,498 | 3.7% | | Salaries and employee benefits | $12,865 | $12,278 | $587 | 4.8% | $24,770 | $24,296 | $474 | 2.0% | | Information technology expenses | $2,592 | $2,227 | $365 | 16.4% | $5,069 | $4,337 | $732 | 16.9% | - Noninterest expense increased by **$1.7 million (8.2%)** for Q2 2025 and **$1.5 million (3.7%)** for YTD Q2 2025[231](index=231&type=chunk)[263](index=263&type=chunk) - Salaries and employee benefits increased due to the Ellerbee Insurance Agency acquisition, partially offset by decreased stock award expense and increased FAS91-deferred costs[264](index=264&type=chunk) - Information technology expenses rose by **16.4%** for Q2 2025 and **16.9%** for YTD Q2 2025, mainly due to increased software expenses[266](index=266&type=chunk) [ Income Tax Expense](index=73&type=section&id=Income%20Tax%20Expense) Income Tax Expense (in thousands) | Metric (in thousands) | Q2 2025 | Q2 2024 | YTD Q2 2025 | YTD Q2 2024 | | :--------------------- | :------ | :------ | :---------- | :---------- | | Income tax expense | $2,100 | $1,500 | $3,700 | $2,900 | | Effective tax rate | 20.5% | 21.0% | 20.3% | 20.9% | - Income tax expense increased for both periods, with effective tax rates of **20.5%** for Q2 2025 and **20.3%** for YTD Q2 2025, slightly lower than the prior year due to tax-exempt income from BOLI and tax-exempt interest[270](index=270&type=chunk)[271](index=271&type=chunk) [Balance Sheet Review](index=74&type=section&id=Balance%20Sheet%20Review) [ Loans and Allowance for Credit Losses](index=74&type=section&id=Loans%20and%20Allowance%20for%20Credit%20Losses) Loans and Allowance for Credit Losses (in thousands) | Metric (in thousands) | June 30, 2025 | December 31, 2024 | | :--------------------- | :------------ | :---------------- | | Gross loans outstanding | $1,993,580 | $1,842,980 | | Allowance for credit losses on loans | $19,153 | $18,980 | | ACL as % of total loans | 0.96% | 1.03% | - Gross loans outstanding increased by **$150.6 million (8.2%)** to **$1.99 billion** at June 30, 2025, with commercial real estate loans comprising **65.1%** of the portfolio[73](index=73&type=chunk)[74](index=74&type=chunk) - The allowance for credit losses on loans increased to **$19.2 million** at June 30, 2025, from **$19.0 million** at December 31, 2024, but decreased as a percentage of total loans to **0.96%** from **1.03%**[229](index=229&type=chunk)[282](index=282&type=chunk) - Net charge-offs to average loans (annualized) for the six months ended June 30, 2025, was **0.17%**, up from **0.14%** in the prior year[288](index=288&type=chunk) [ Nonperforming Assets](index=77&type=section&id=Nonperforming%20Assets) Nonperforming Assets (in thousands) | Metric (in thousands) | June 30, 2025 | December 31, 2024 | | :--------------------- | :------------ | :---------------- | | Nonaccrual loans | $10,584 | $10,660 | | Loans past due 90 days and accruing | $107 | $152 | | Other real estate owned | $710 | $202 | | Repossessed assets | $21 | $328 | | Total nonperforming assets | $11,422 | $11,342 | | NPAs as a percentage of total assets | 0.37% | 0.36% | - Total nonperforming assets increased slightly to **$11.4 million** at June 30, 2025, from **$11.3 million** at December 31, 2024, representing **0.37%** of total assets (up from **0.36%**)[290](index=290&type=chunk)[293](index=293&type=chunk) - Nonaccrual loans decreased by **$0.08 million (0.7%)** to **$10.6 million**, while Other Real Estate Owned (OREO) increased to **$0.71 million** from **$0.20 million**[290](index=290&type=chunk)[293](index=293&type=chunk) [ Deposits](index=78&type=section&id=Deposits) Deposits (in thousands) | Metric (in thousands) | June 30, 2025 | December 31, 2024 | | :--------------------- | :------------ | :---------------- | | Noninterest-bearing deposits | $434,785 | $462,283 | | Interest-bearing deposits | $2,121,445 | $2,105,660 | | Total deposits | $2,556,230 | $2,567,943 | - Total deposits decreased by **$11.7 million (0.5%)** to **$2.56 billion** at June 30, 2025, from **$2.57 billion** at December 31, 2024, primarily due to seasonality[295](index=295&type=chunk) - Noninterest-bearing deposits comprised **17.0%** of total deposits at June 30, 2025, down from **18.0%** at December 31, 2024[295](index=295&type=chunk) - Estimated uninsured deposits were **$839.8 million (32.42%)** of total Bank deposits at June 30, 2025, slightly down from **$857.6 million (33.03%)** at December 31, 2024[297](index=297&type=chunk) [ Off-Balance Sheet Arrangements](index=78&type=section&id=Off-Balance%20Sheet%20Arrangements) - The Company is party to credit-related financial instruments with off-balance sheet risk, including commitments to extend credit and letters of credit, to meet customer financing needs[298](index=298&type=chunk) - The exposure to credit loss is represented by the contractual amount of these commitments, with collateral obtained based on management's credit evaluation[299](index=299&type=chunk) [ Liquidity](index=78&type=section&id=Liquidity) - The Company maintains strong liquidity with approximately **$1.3 billion** in available funding sources at June 30, 2025[237](index=237&type=chunk) - Primary liquidity sources include customer deposits, FHLB advances, and federal funds lines of credit. Cash and cash equivalents decreased to **$112.1 million** at June 30, 2025, from **$231.0 million** at December 31, 2024, mainly due to loan growth[302](index=302&type=chunk)[304](index=304&type=chunk) - At June 30, 2025, the Company had **$605.1 million** of additional borrowing availability with the FHLB and **$109.4 million** from the Federal Reserve Discount Window, with no outstanding balances[305](index=305&type=chunk)[306](index=306&type=chunk) [ Capital Resources](index=79&type=section&id=Capital%20Resources) - The Company and Colony Bank are required to maintain minimum capital levels and were considered 'well-capitalized' as of June 30, 2025, exceeding all regulatory requirements[308](index=308&type=chunk)[309](index=309&type=chunk) Capital Ratios | Capital Ratio | Company (June 30, 2025) | Company (December 31, 2024) | Colony Bank (June 30, 2025) | Colony Bank (December 31, 2024) | | :------------ | :---------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | CET1 risk-based capital ratio | 12.34% | 13.08% | 13.24% | 14.33% | | Tier 1 risk-based capital ratio | 13.42% | 14.26% | 13.24% | 14.33% | | Total risk-based capital ratio | 16.06% | 17.10% | 14.14% | 15.29% | | Leverage ratio | 9.61% | 9.50% | 9.48% | 9.55% | - Consolidated Common Equity Tier 1 (CET1) and total capital ratios were **12.34%** and **16.06%**, respectively, at June 30, 2025, indicating strong capital adequacy[237](index=237&type=chunk)[311](index=311&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=61&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) Outlines the Company's primary market risk exposures, including credit, interest rate, and liquidity risks, managed via Asset Liability Management Policy and simulation models - The Company's primary market risk exposures are credit risk, interest rate risk, and liquidity risk, managed through an Asset Liability Management Policy and simulation models[313](index=313&type=chunk) Impact of Interest Rate Changes on Net Interest Income | Changes in rates | Increase (Decrease) in Net Interest Income from Base Scenario at June 30, 2025 | | :--------------- | :-------------------------------------------------------------------------- | | 200 basis point increase | 4.89% | | 100 basis point increase | 2.50% | | 100 basis point decrease | (0.25)% | | 200 basis point decrease | (0.57)% | - There were no material changes to market and interest rate risk disclosures during the period covered by this report compared to the 2024 Form 10-K[316](index=316&type=chunk) [Item 4. Controls and Procedures](index=61&type=section&id=Item%204.%20Controls%20and%20Procedures) Confirms effective disclosure controls and procedures as of June 30, 2025, with no material changes in internal control over financial reporting during the quarter - The Company's disclosure controls and procedures were evaluated and deemed effective as of June 30, 2025, ensuring timely and accurate reporting[317](index=317&type=chunk) - No material changes in internal control over financial reporting were identified during the quarter ended June 30, 2025[318](index=318&type=chunk) PART II – Other Information [Item 1. Legal Proceedings](index=62&type=section&id=Item%201.%20Legal%20Proceedings) Details the Company's ordinary course legal proceedings, with management assessing no material adverse effect on financial position - Various legal proceedings are pending against the Company and the Bank in the ordinary course of business[320](index=320&type=chunk) - Management's opinion is that any aggregate liabilities from these proceedings would not materially adversely affect the Company's consolidated financial position[320](index=320&type=chunk) [Item 1A. Risk Factors](index=62&type=section&id=Item%201A.%20Risk%20Factors) Refers to 2024 Form 10-K risk factors, confirming no material changes during the current reporting period - Readers should consider the risk factors discussed in the Company's 2024 Form 10-K[321](index=321&type=chunk) - No material changes to the previously disclosed risk factors occurred during the period covered by this report[322](index=322&type=chunk) [Item 2. Unregistered Sale of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities](index=62&type=section&id=Item%202.%20Unregistered%20Sale%20of%20Equity%20Securities%2C%20Use%20of%20Proceeds%2C%20and%20Issuer%20Purchases%20of%20Equity%20Securities) Reports no unregistered common stock sales in Q2 2025 and details share repurchase activity under the extended buyback program - No unregistered shares of common stock were sold during the three-month period ended June 30, 2025[323](index=323&type=chunk) Issuer Purchases of Equity Securities | Period | Total Number of Shares Repurchased | Average Price Paid per Share | Maximum Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (in thousands) | | :----- | :------------------------------- | :--------------------------- | :------------------------------------------------------------------------------------------- | | May 1, 2025 to May 31, 2025 | 38,134 | $15.63 | $8,525 | | June 1, 2025 to June 30, 2025 | 23,883 | $15.20 | $8,162 | | Total | 62,017 | $15.46 | $8,162 | - The Board of Directors extended the stock buyback program on December 18, 2024, authorizing repurchases of up to **$9.8 million** of outstanding common stock until the end of 2025[324](index=324&type=chunk) [Item 3. Defaults Upon Senior Securities](index=83&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) Confirms no defaults upon senior securities occurred during the reporting period - There were no defaults upon senior securities[325](index=325&type=chunk) [Item 4. Mine Safety Disclosures](index=83&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) States that mine safety disclosures are not applicable to the Company - Mine safety disclosures are not applicable to the Company[326](index=326&type=chunk) [Item 5. Other Information](index=83&type=section&id=Item%205.%20Other%20Information) Confirms no directors or executive officers adopted, terminated, or modified Rule 10b5-1 or non-Rule 10b5-1 trading arrangements in Q2 2025 - No directors or executive officers adopted, terminated, or modified Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during the three months ended June 30, 2025[327](index=327&type=chunk) [Item 6. Exhibits](index=83&type=section&id=Item%206.%20Exhibits) Lists Form 10-Q exhibits, including the Merger Agreement, corporate governance documents, CEO/CFO certifications, and Interactive Data Files - Exhibits include the Agreement and Plan of Merger with TC Bancshares, Inc., corporate governance documents (Articles of Incorporation, Bylaws), CEO and CFO certifications (Sections 302 and 906 of Sarbanes-Oxley Act), and Interactive Data Files (Inline XBRL)[329](index=329&type=chunk) [Signatures](index=84&type=section&id=Signatures) Contains the duly authorized signatures of Colony Bankcorp's CEO and CFO, certifying the report's submission - The report is signed by T. Heath Fountain, Chief Executive Officer, and Derek Shelnutt, Executive Vice President and Chief Financial Officer, on August 8, 2025[332](index=332&type=chunk)

Group 1 - Halper Sadeh LLC is investigating City Office REIT, Inc. for potential violations related to its sale to MCME Carell Holdings at $7.00 per share in cash [1] - Colony Bankcorp, Inc. is involved in a merger with TC Bancshares, Inc., and Halper Sadeh LLC may seek increased consideration for shareholders [2] - The firm offers free consultations for shareholders to discuss their legal rights and options [3] Group 2 - Halper Sadeh LLC represents investors globally who have experienced securities fraud and corporate misconduct, recovering millions for defrauded investors [3]

Financial Data and Key Metrics Changes - Core earnings improved significantly in Q2 2025, supported by loan growth and operational efficiency [4] - Return on assets (ROA) for the quarter was 1.02%, an improvement from the previous quarter, achieving the short-term target earlier than projected [6] - Net interest margin increased to 3.12%, with expectations for further increases in the second half of the year [7][12] - Net income increased by $1.4 million compared to the first quarter, driven by higher net interest income and lower provision expenses [11][12] Business Line Data and Key Metrics Changes - Strong loan growth of 15% annualized rate in Q2, with expectations for moderation to 10% to 12% in the second half of the year [5][16] - Noninterest income improved quarter over quarter, particularly in mortgage and Marine and RV lending [7][13] - Noninterest expenses increased by $1.8 million, primarily due to variable compensation expenses [14] Market Data and Key Metrics Changes - Total deposits decreased by $66 million during the quarter, consistent with seasonal trends, but year-over-year deposits increased by over $75 million [17][18] - The weighted average new and renewed loan rate for Q2 was 7.78%, positively impacting portfolio yield [16] Company Strategy and Development Direction - The company announced a definitive merger agreement with TC Bancshares, enhancing its market presence in South Georgia and North Florida [4][5] - The merger is expected to be immediately accretive to earnings per share and enhance the company's earnings power and balance sheet strength [24][28] - The company aims to leverage opportunities for further acquisitions in the future while focusing on the successful integration of TC Bancshares [39][40] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in maintaining a ROA of 1% or better and moving towards an intermediate goal of 1.2% [6] - The company anticipates a healthy loan pipeline despite expected moderation in growth rates [5] - Management noted stable credit quality with improvements in nonperforming assets and classified loans [8][16] Other Important Information - The company celebrated its fiftieth anniversary by ringing the opening bell at the New York Stock Exchange [10] - A quarterly cash dividend of $0.01 per share was declared [19] Q&A Session Summary Question: Update on loan pipelines and growth rates - Management indicated loan growth was 15% in the last quarter and expected to trend towards 10% to 12% for the remainder of the year, with deposits flattening out [34][35] Question: Details on merger accretion and systems conversion - The change in accretion from 2026 to 2027 is influenced by expense changes and continued organic growth, with the systems conversion expected in the first quarter [37][38] Question: Health of the loan portfolio, particularly in SBA lending - Management reported stable credit quality with some elevated charge-offs in the SBA segment, but overall performance remains strong [42][45] Question: Additional runway for loan repricing - There is still potential for asset repricing, with new loans being issued at favorable rates, although margin expansion may moderate [48][50]

Company Profile & Strategy - Colony Bank had $31 billion in assets as of June 30, 2025[10] - The company aims to achieve a return on assets target of 100% in the short term[15] - The company expects to return to an 8-12% organic growth run rate by the end of 2025[16] - The company is proactively seeking M&A opportunities, noting 319 banks under $600 million and 87 banks between $600 million and $12 billion[19] Financial Performance & Portfolio - The Small Business Specialty Lending (SBSL) group's loan portfolio breakdown shows $812 million with 483% in Commercial RE, 11% in Residential RE, 376% in Commercial, financial & agriculture, and 3% in Construction[24] - The current indicated annual dividend rate is $046 per share, equating to a yield of 26%[30] - Total liquidity sources as of June 30, 2025, were $12669 million, including $747 million in FRB Reserves and $3271 million in unencumbered securities[34] - As of June 30, 2025, commercial/business accounts represent 135% of accounts and 445% of total deposits balance, while consumer accounts represent 865% of accounts and 555% of total deposits balance[47] Loan Portfolio & Investment Securities - As of June 30, 2025, the loan portfolio totaled $19936 million, with 829% in Real Estate, 64% in Consumer and Other, 98% in Commercial, and 09% in Agriculture[56] - Investment securities portfolio composition as of June 30, 2025, includes 40% in US Agency MBS/CMO ($336962 thousand) and 31% in Municipal securities ($256256 thousand)[72]

Financial Performance - Colony Bankcorp (CBAN) reported quarterly earnings of $0.46 per share, exceeding the Zacks Consensus Estimate of $0.40 per share, and up from $0.34 per share a year ago, representing an earnings surprise of +15.00% [1] - The company posted revenues of $32.48 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 4.68%, compared to year-ago revenues of $27.91 million [2] Market Performance - Colony Bankcorp shares have increased approximately 9.9% since the beginning of the year, outperforming the S&P 500's gain of 7.3% [3] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $0.41 on revenues of $31.66 million, and for the current fiscal year, it is $1.60 on revenues of $124.31 million [7] - The estimate revisions trend for Colony Bankcorp was mixed ahead of the earnings release, resulting in a Zacks Rank 3 (Hold) for the stock, indicating expected performance in line with the market [6] Industry Context - The Banks - Southeast industry, to which Colony Bankcorp belongs, is currently in the top 14% of over 250 Zacks industries, suggesting a favorable outlook compared to the bottom 50% [8]

[Second Quarter 2025 Financial Highlights & Overview](index=1&type=section&id=Second%20Quarter%202025%20Financial%20Highlights%20%26%20Overview) [Financial Highlights](index=1&type=section&id=Financial%20Highlights) Colony Bankcorp reported strong Q2 2025 results, featuring significant growth in net income and EPS, expanded net interest margin, and a strategic acquisition Q2 2025 Key Financial Results | Metric | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | Net Income | $8.0 million | $6.6 million | $5.5 million | | Diluted EPS | $0.46 | $0.38 | $0.31 | | Operating Net Income | $8.0 million | $6.6 million | $6.0 million | | Adjusted Diluted EPS | $0.46 | $0.38 | $0.34 | | Provision for Credit Losses | $450,000 | $1.5 million | $650,000 | - The Board of Directors declared a quarterly cash dividend of **$0.1150 per share**, payable on August 20, 2025, to shareholders of record as of August 6, 2025[4](index=4&type=chunk) - Total loans (excluding held for sale) increased by **$72.3 million (3.76%)** from the previous quarter to **$1.99 billion**, while total deposits decreased by **$66.3 million** to **$2.56 billion**[7](index=7&type=chunk) - The company announced a **strategic acquisition of TC Bancshares, Inc.**, aimed at strengthening its franchise and expanding its market reach[6](index=6&type=chunk) - CEO Heath Fountain highlighted the **meaningful expansion of the net interest margin**, supported by a well-positioned balance sheet and stable funding costs[5](index=5&type=chunk) [Financial Condition and Results of Operations](index=2&type=section&id=Financial%20Condition%20and%20Results%20of%20Operations) [Balance Sheet](index=2&type=section&id=Balance%20Sheet) Total assets slightly decreased to $3.12 billion as of June 30, 2025, with robust loan growth offset by a decline in total deposits Balance Sheet Summary (as of June 30, 2025) | Metric | Q2 2025 | Q1 2025 | Change | | :--- | :--- | :--- | :--- | | Total Assets | $3.12 billion | $3.17 billion | -$56.2 million | | Total Loans (excl. HFS) | $1.99 billion | $1.92 billion | +$72.3 million | | Total Deposits | $2.56 billion | $2.62 billion | -$66.3 million | - The decrease in deposits was driven by a **$34.6 million** fall in interest-bearing demand deposits and a **$22.3 million** drop in savings and money market deposits, partially offset by a **$5.7 million** rise in time deposits compared to Q1 2025[11](index=11&type=chunk) - Year-over-year, total deposits increased by **$96.0 million** from June 30, 2024[11](index=11&type=chunk) [Capital](index=2&type=section&id=Capital) The company maintained a strong capital position, with all regulatory capital ratios exceeding 'well-capitalized' minimums, and repurchased common stock Preliminary Capital Ratios (as of June 30, 2025) | Ratio | Percentage | | :--- | :--- | | Tier One Leverage Ratio | 9.61% | | Tier One Capital Ratio | 13.42% | | Total Risk-Based Capital Ratio | 16.06% | | Common Equity Tier One Capital Ratio | 12.34% | - A total of **$959,092** was spent on repurchasing **62,017 shares** of common stock in Q2 2025 under the approved stock repurchase program[11](index=11&type=chunk) [Results of Operations](index=2&type=section&id=Second%20Quarter%202025%20Results%20of%20Operations) Q2 2025 profitability significantly improved, driven by higher net interest income and a wider net interest margin, despite increased noninterest expenses Q2 2025 vs. Q2 2024 Performance | Metric | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | Net Interest Income (tax-equivalent) | $22.6 million | $18.6 million | +$4.0 million | | Net Interest Margin | 3.12% | 2.68% | +44 bps | | Noninterest Income | $10.1 million | $9.5 million | +6.33% | | Noninterest Expense | $22.0 million | $20.3 million | +$1.7 million | - The increase in net interest income was primarily due to a **$3.5 million** rise in income on interest-earning assets, while expense on interest-bearing liabilities decreased by **$477,000** compared to Q2 2024[11](index=11&type=chunk) [Asset Quality](index=2&type=section&id=Asset%20Quality) Asset quality remained solid with decreased nonperforming assets and a lower credit loss reserve, though net loans charged-off increased Asset Quality Metrics | Metric | June 30, 2025 | March 31, 2025 | | :--- | :--- | :--- | | Nonperforming Assets | $11.4 million | $13.0 million | | Credit Loss Reserve / Total Loans | 0.96% | 1.04% | | Net Loans Charged-off (Q2'25 vs Q1'25) | $1.0 million (0.21%) | $606,000 (0.13%) | - The credit loss reserve stood at **$19.2 million** at the end of Q2 2025, down from **$20.0 million** at the end of Q1 2025[16](index=16&type=chunk) [Financial Tables](index=6&type=section&id=Financial%20Tables) [Reconciliation of Non-GAAP Measures](index=6&type=section&id=Reconciliation%20of%20Non-GAAP%20Measures) Non-GAAP measures like operating net income and adjusted EPS are used to provide a clearer understanding of core performance by excluding specific items Q2 2025 Non-GAAP Reconciliation Highlights (in thousands) | Metric | GAAP | Adjustments | Non-GAAP (Operating) | | :--- | :--- | :--- | :--- | | Net Income | $7,978 | $0 | $7,978 | | Diluted EPS | $0.46 | $0.00 | $0.46 | | Return on Average Assets | 1.02% | 0.00% | 1.02% | | Efficiency Ratio | 67.74% | 0.00% | 67.74% | [Selected Financial Information](index=8&type=section&id=Selected%20Financial%20Information) This section summarizes key earnings, performance ratios, and balance sheet data, showing improved profitability and tangible book value per share in Q2 2025 Quarterly Performance Ratios | Ratio | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | Net Interest Margin | 3.12% | 2.93% | 2.68% | | Return on Average Assets | 1.02% | 0.85% | 0.73% | | Return on Average Equity | 11.14% | 9.63% | 8.46% | | Tangible Book Value/Share | $13.73 | $13.46 | $12.10 | Quarterly Asset Quality Ratios | Ratio | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | NPAs to Total Assets | 0.37% | 0.41% | 0.24% | | NPLs to Total Loans | 0.54% | 0.65% | 0.36% | | Net Charge-offs to Avg. Loans | 0.21% | 0.13% | 0.14% | [Average Balance Sheet and Net Interest Analysis](index=10&type=section&id=Average%20Balance%20Sheet%20and%20Net%20Interest%20Analysis) Net interest margin significantly expanded in Q2 2025, driven by higher asset yields and lower liability costs, with average interest-earning assets growing YoY Net Interest Margin Analysis (Three Months Ended June 30) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Yield on Interest-Earning Assets | 5.11% | 4.83% | | Cost of Interest-Bearing Liabilities | 2.42% | 2.64% | | Interest Rate Spread | 2.69% | 2.19% | | Net Interest Margin | 3.12% | 2.68% | [Segment Reporting](index=12&type=section&id=Segment%20Reporting) The company operates through Banking, Mortgage Banking, and SBSL segments, with Banking as the primary income contributor and Mortgage Banking showing significant growth Segment Income (in thousands) | Segment | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | Banking Division | $7,441 | $6,201 | $4,012 | | Mortgage Banking Division | $249 | $21 | $138 | | Small Business Specialty Lending | $288 | $391 | $1,324 | [Consolidated Financial Statements](index=13&type=section&id=Consolidated%20Financial%20Statements) Consolidated financial statements show total assets of $3.12 billion, net loans of $1.97 billion, and total deposits of $2.56 billion, with Q2 2025 net income up 46% YoY Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Total Assets | $3,115,617 | $3,109,782 | | Loans, net | $1,974,427 | $1,824,000 | | Total Deposits | $2,556,230 | $2,567,943 | | Total Stockholders' Equity | $293,857 | $278,675 | Consolidated Income Statement Highlights (Three Months Ended June 30, in thousands) | Account | 2025 | 2024 | | :--- | :--- | :--- | | Net Interest Income | $22,385 | $18,409 | | Noninterest Income | $10,098 | $9,497 | | Noninterest Expense | $22,004 | $20,330 | | Net Income | $7,978 | $5,474 | [Loan and Deposit Analysis](index=16&type=section&id=Loan%20and%20Deposit%20Analysis) Loan and deposit schedules detail a QoQ decrease in deposits to $2.56 billion and an increase in loans to $1.99 billion, with regional concentrations - Total deposits decreased by **$66.3 million** QoQ, with declines in interest-bearing demand and savings accounts, and reciprocal deposits also decreased by **$13.2 million**[37](index=37&type=chunk)[38](index=38&type=chunk) - Total loans increased by **$72.3 million** QoQ, led by a **$29.2 million** increase in Construction, land & land development loans and a **$21.4 million** increase in Consumer and other loans[39](index=39&type=chunk)[40](index=40&type=chunk) - By location, the Atlanta and North Georgia loan portfolio is the largest at **$445.9 million**, while the South Georgia region holds the most deposits at **$1.20 billion**[38](index=38&type=chunk)[41](index=41&type=chunk) [Credit Quality Details](index=18&type=section&id=Credit%20Quality%20Details) Detailed tables show total classified loans decreased to $25.1 million and criticized loans to $54.8 million in Q2 2025, with commercial real estate as the largest portion Classified and Criticized Loans (in thousands) | Category | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | Classified Loans | $25,112 | $26,453 | $22,355 | | Criticized Loans | $54,814 | $55,823 | $44,850 | - Other commercial real estate loans constitute the largest portion of both classified (**$16.7 million**) and criticized (**$30.0 million**) loans[42](index=42&type=chunk)[43](index=43&type=chunk) [Company Information & Disclosures](index=3&type=section&id=Company%20Information%20%26%20Disclosures) [About Colony Bankcorp](index=3&type=section&id=About%20Colony%20Bankcorp) Colony Bankcorp, founded in 1975, is a bank holding company operating across Georgia, Alabama, and Florida, offering diverse personal and business banking services - Colony Bankcorp operates locations in Georgia, Birmingham (Alabama), Tallahassee (Florida), and the Florida Panhandle[13](index=13&type=chunk) - Specialized services include mortgage lending, government guaranteed lending, consumer insurance, wealth management, credit cards, and merchant services[13](index=13&type=chunk) [Forward-Looking Statements](index=3&type=section&id=Forward-Looking%20Statements) This section cautions that forward-looking statements are subject to risks and uncertainties, including economic conditions, interest rate changes, and competition - The document cautions investors that forward-looking statements are subject to risks and uncertainties and are not guarantees of future performance[14](index=14&type=chunk)[15](index=15&type=chunk) - Key risk factors mentioned include economic conditions, interest rate volatility, competition from regional institutions and fintechs, and risks related to integrating acquisitions[15](index=15&type=chunk)[17](index=17&type=chunk) [Explanation of Non-GAAP Financial Measures](index=5&type=section&id=Explanation%20of%20Certain%20Unaudited%20Non-GAAP%20Financial%20Measures) Non-GAAP financial measures are used to provide supplemental information and enhance investors' understanding by excluding certain non-recurring or non-operational items - Non-GAAP measures are used by management to analyze company performance and are believed to provide a clearer understanding for investors[21](index=21&type=chunk) - Examples of non-GAAP measures used include operating net income, adjusted earnings per diluted share, tangible book value per common share, and operating efficiency ratio[20](index=20&type=chunk)