Colony Bank (CBAN) Q2 2025 Earnings Transcript

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Thursday, Jul. 24, 2025 astatine 9 a.m. ET

• Chief Executive Officer — T. Heath Fountain

• Chief Financial Officer — Derek W. Shelnutt

• Chief Executive Officer, TC Bancshares — Gregory H. Eiford

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T. Heath Fountain: Thanks, Brantley, and convey you to everyone for joining our 2nd 4th net call. We're pleased to study improved fiscal show this quarter, which reflects the continued betterment of our operations and occurrence and subject of our squad members. Core net improved meaningfully successful the quarter, supported by some indebtedness maturation and efficiency. We besides saw continued enlargement successful our nett involvement margin, benefiting from pricing subject connected the plus broadside and our unchangeable halfway deposit base. Also, we announced yesterday that we entered a definitive merger statement with TC Bancshares, which operates TC Federal Bank successful charismatic markets successful South Georgia and North Florida. We judge this concern represents a compelling strategical and taste fit.

We'll sermon that transaction successful much item aboriginal successful the call, including the expected benefits and timing. On the lending front, we delivered beardown indebtedness maturation of 15% annualized complaint successful the 2nd quarter, continuing the affirmative momentum we've seen this year. While maturation came successful conscionable somewhat beneath archetypal 4th levels, we proceed to spot coagulated request crossed some commercialized and user portfolios. Looking ahead, we expect indebtedness maturation whitethorn mean somewhat successful the 2nd fractional of the year, person to the 10% to 12% range, but the pipeline remains precise healthy.

Our instrumentality connected assets for the 4th was 1.02%, which is simply a meaningful betterment from the anterior 4th and has been a short-term people for us, achieving that 1% ROA. So we're pleased we're capable to execute that. It came astir a 4th earlier than what we had projected. We consciousness assured successful our quality to support that 1% oregon amended ROA going guardant and present determination towards our intermediate extremity of achieving a 1.2% ROA. Margin accrued to 3.12% successful the quarter. And arsenic we antecedently mentioned, that borderline implicit 3% was wherever forecasts were indicating we would beryllium astatine a 1% oregon amended ROA. We inactive expect borderline to summation successful the 2nd fractional of the year.

However, with much normalized indebtedness maturation complaint and a stabilizing outgo of funds, we're apt to spot the enlargement beryllium softer successful the remainder of the twelvemonth than what we saw successful this past quarter. Noninterest income improved quarter-over-quarter arsenic gross accrued crossed galore of our complementary lines of business, peculiarly successful mortgage. We besides had a truly bully 4th successful Marine and RV lending. While we did spot betterment compared to the anterior quarter, we inactive deliberation there's an accidental for meaningful betterment to heighten that show crossed our concern lines, and that's a existent precedence for us. Credit prime remained stable, and we saw betterment successful nonperforming assets arsenic good arsenic criticized and classified loans.