COLONY BANKCORP INC Q1 FY2025 earnings call

• Loan growth: Better than expected in Q1, with 17% annualized growth; future growth expected to be 8%-12% annualized. - Deposits: ~8.5% annualized increase, focus on low-cost transactional DDA accounts. - Acquisition: Excited about acquisition of Ellerbee Agency, which is EPS accretive; Insurance division growth emphasized. - Credit card program: Launched consumer and commercial credit cards, expected to generate non-interest income. - Market volatility: Monitoring equity and fixed income market volatility, no impact on loan portfolio health yet. - M&A: Expect to participate in bank M&A; M&A activity in footprint creates opportunities to grow customer base and recruit talent. - Board changes: Paul Joiner joined Board, Ed Loomis retired.

Loan growth: First quarter annualized loan growth was 17%. Future quarters likely to be closer to normal range of 8% to 12% annualized growth. Deposits: Annualized increase of about 8.5%, close to $55 million for the quarter, with growth in lower-cost transactional deposit accounts. Net interest income: Increased by approximately $480,000. Margin: Increased 9 basis points to 2.93% from 2.84% in prior quarter. Non-interest income: Decreased about $1.7 million, driven by slower SBSL division activity ($1.6 million revenue drop), but SBSL pipeline picking up.

• Loan growth: Future quarters likely to be in 8% to 12% annualized range. - Margin: Expect modest increases in 2025. - Stock repurchase: Repurchased 38,000 shares at average price $16.45; additional repurchases possible. - Dividend: Quarterly cash dividend of $0.115 per share declared. - Bond portfolio cash flow: Expected $80 million to $90 million for remainder of year.

• Market volatility: Equity and fixed income market volatility, impact on rate expectations. - Trade dynamics: Uncertainty around global trade and tariff policies, potential impact on customers. - Deposit seasonality: Seasonal outflow in municipal deposits, may affect cost of funds and margin.

Q: What are the trends and expectations for SBSL, loan growth and asset quality as well as pricing for the rest of the year? And any impacts from recent actions from the current administration?

A: Thanks for the question. Addressed trade policy impacts, customer supply chain adjustments, SBSL pipeline picking up, and monitoring trade effects.

Q: What net interest margin impacts do you expect from a 25 basis point rate cut?

A: Heath mentioned Derek would add color. Derek discussed earning asset yield impact, cash flow from bond portfolio, and cost of funds management related to rate cut