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Mar 31, 2020
Capital City Bank Q1 2020 Earnings Report
Reported net income of $4.3 million, impacted by a $5.0 million provision for credit losses due to deteriorating economic conditions related to COVID-19.
Key Takeaways
Capital City Bank Group reported a net income of $4.3 million, or $0.25 per diluted share, for Q1 2020. This includes a $5.0 million provision for credit losses, exceeding net loan charge-offs of $1.1 million, due to COVID-19's economic impact.
Diversified revenue and strong balance sheet buffered impact of COVID-19 and Fed interest rate actions.
Average loans (ex-held for sale) up 0.8% sequentially and 4.2% over 2019.
Loan loss provision of $5.0 million reflected reserve build for COVID-19 impact.
Acquisition of a 51% membership interest in Brand Mortgage Group, LLC (now operated as Capital City Home Loans (“CCHL”)) occurred March 1st – nominal net impact on earnings.
Capital City Bank
Capital City Bank
Capital City Bank Revenue by Segment
Revenue by Segment
Deposit Fees Revenue
CapyFin.comBank Card Fees Revenue
CapyFin.comWealth Management Fees Revenue
CapyFin.comMortgage Banking Revenues Revenue
CapyFin.comOther Noninterest Income Revenue
CapyFin.com Forward Guidance
Deposit levels remain strong, and average core deposits grew over last quarter. As a result of the Coronavirus Aid, Relief, and Economic Security (CARES) Act, and our participation in the Paycheck Participation Program (PPP) to support small businesses, the potential exists for our deposit levels to be volatile over the coming quarters due to the government’s distribution of economic impact payments and the funding of PPP loans.
Positive Outlook
- Current liquidity levels will remain adequate due to our strong overnight funds sold position
- Cash flow generated from the investment portfolio.
- Short-term advances from the FHLB or FRB could be considered if necessary.
- Deposit rates are monitored on an ongoing basis and adjusted if necessary
- A prudent pricing discipline remains the key to managing our mix of deposits.
Challenges Ahead
- The magnitude and duration of the COVID-19 pandemic and its impact on the global economy and financial market conditions and our business, results of operations and financial condition, including the impact of our participation in government programs related to COVID-19
- The accuracy of the our financial statement estimates and assumptions
- Legislative or regulatory changes
- Fluctuations in inflation, interest rates, or monetary policies
- The effects of security breaches and computer viruses that may affect our computer systems or fraud related to debit card products