Colony Bank(CBAN) - 2024 Q4 - Annual Report

Financial Performance and Capital Management - The Company completed a private placement of $39.5 million in subordinated notes with a fixed rate of 5.25$2,249,000, leaving $9,751,000 available for further repurchases under the stock buyback program[29]. - The Company surpassed the$3 billion asset threshold in 2023, which requires compliance with minimum regulatory capital levels[62]. - The Company is required to maintain a minimum Tier 1 risk-based capital ratio of 6.0% and a total risk-based capital ratio of 10.0% to be considered well-capitalized[60]. - As of December 31, 2024, the Company's and the Bank's regulatory capital ratios were above the applicable well-capitalized standards and met the then-applicable capital conservation buffer[63]. - The capital conservation buffer of 2.5% must be maintained above each minimum capital ratio requirement to allow for dividend payments and share buybacks[57]. - The Company must seek approval from the Georgia Department of Banking and Finance to pay dividends if certain capital ratios are not met[67]. Regulatory Compliance and Governance - The Company recognizes the importance of compliance with governmental and regulatory requirements, including the Dodd-Frank Act[40]. - The Company must comply with various corporate governance and financial reporting requirements under the Sarbanes-Oxley Act of 2002[49]. - The Dodd-Frank Act mandates that public companies provide shareholders with advisory votes on executive compensation at least every three years[52]. - The Company is subject to oversight by the SEC, FINRA, PCAOB, and various state securities regulators[53]. - The Federal Reserve has not yet revised the well-capitalized standard for bank holding companies to reflect higher capital requirements[60]. - The Company has undertaken efforts to ensure that incentive compensation plans do not encourage inappropriate risks, consistent with regulatory principles[51]. Banking Operations and Market Environment - The Bank operates through 34 offices across Georgia and has a corporate banking office in Birmingham, Alabama, and a loan production office in Tallahassee, Florida[26]. - The banking industry is highly competitive, with pressures from larger regional banks, smaller community banks, and nonbank financial institutions[30]. - The Company maintains correspondent relationships with several banks to facilitate business transactions in markets without a physical presence[32]. - The Company offers a variety of deposit products designed to meet the needs of individuals and businesses, focusing on expanding core deposits[25]. Employee and Talent Management - The Company had a total of 465 employees as of December 31, 2024, with 455 being full-time equivalent employees[34]. - The Company emphasizes talent acquisition, development, and retention as a strategic priority, focusing on inclusivity and professional development initiatives[35]. Risk Management and Credit Regulations - The Bank is required to notify regulators within 36 hours of a "computer-security incident" that qualifies as a "notification incident"[90]. - The CFPB's ATR/QM rule requires lenders to consider income, employment status, assets, payment amounts, and credit history before mortgage approval[91]. - Qualified mortgages must have a total debt-to-income ratio of less than or equal to 43%[91]. - The CFPB mandates that securitizers retain at least 5% of the credit risk for asset-backed securities unless exempted[91]. - The Bank is subject to the Equal Credit Opportunity Act and Fair Housing Act, prohibiting discrimination in credit transactions[92]. - The DOJ has intensified efforts to prosecute violations of the ECOA and FHA[92]. - New rules limit interest and charges on credit cards and debit card overdrafts[92]. - The Bank must provide disclosures to help the public assess its fulfillment of community housing needs[92]. - The Bank is prohibited from discriminatory practices when extending credit[92]. - The Bank must comply with new standards for error correction and information disclosure regarding mortgage servicing[91]. Market Risk and Interest Rate Sensitivity - The information on market risk and interest rate sensitivity is detailed in Item 7 of the report[328].