CCBG Capital City Bank Group Inc

Capital City Bank Group, Inc. (NASDAQ: CCBG) today reported net income attributable to common shareowners of $11.7 million, or $0.70 per diluted share, for the fourth quarter of 2023 compared to $12.7 million, or $0.74 per diluted share, for the third quarter of 2023, and $9.6 million, or $0.56 per diluted share, for the fourth quarter of 2022.

For the full year of 2023, net income attributable to common shareowners totaled $52.3 million, or $3.07 per diluted share, compared to net income of $33.4 million, or $1.97 per diluted share, for the same period of 2022.

QUARTER HIGHLIGHTS (4th Quarter 2023 versus 3rd Quarter 2023)

Income Statement

• Tax-equivalent net interest income totaled $39.3 million compared to $39.4 million for the prior quarter – total deposit cost increased 8 basis points to 66 basis points – net interest margin increased four basis points to 4.07%
• Continued strong credit quality metrics – allowance coverage ratio increased from 1.08% to 1.10% - net loan charge-offs were 23 basis points (annualized) of average loans compared to 17 basis points for the prior quarter
• Noninterest income increased $0.4 million, or 2.6%, driven by higher mortgage banking revenues
• Noninterest expense increased $0.9 million, or 2.2%, primarily due to lower realized loan cost (credit offset to salary expense) reflective of lower level of residential loan originations and higher professional/legal fees of $0.6 million   

Balance Sheet

• Loan balances grew $38.6 million, or 1.4% (average), and $28.7 million, or 1.1% (end of period)
• Deposit balances (including repurchase agreements) declined by $46.8 million, or 1.3% (average), and increased $165.4 million, or 4.6% (end of period) reflective of the seasonal increase in public fund balances
• Tangible book value per share increased $1.23, or 6.4%, and reflected a $12.5 million ($0.74/share) decrease in the accumulated other comprehensive loss reflective of lower investment security losses of $9.3 million and a favorable year-end re-measurement adjustment for the pension plan of $4.3 million

FULL YEAR 2023 HIGHLIGHTS

Income Statement

• Tax-equivalent net interest income totaled $159.4 million for 2023 compared to $125.3 million for 2022 driven by strong loan growth and higher interest rates, partially offset by higher deposit cost which was well controlled at 48 basis points for the year – net interest margin was 4.05% for 2023 compared to 3.14% for 2022
• Credit quality metrics remained strong throughout the year – allowance coverage ratio increased from 0.98% to 1.10% - net loan charge-offs were 18 basis points of average loans for both periods
• Noninterest income decreased $3.6 million, or 4.8%, driven by lower wealth management fees reflective of lower insurance commissions (large policy sales in 2022) and mortgage banking revenues (lower residential loan originations attributable to the higher interest rate environment)
• Noninterest expense increased $5.4 million, or 3.6%, primarily due to higher compensation and occupancy expense reflective of the addition of staffing and banking offices in our new markets   

Balance Sheet

• Loan balances grew $467.0 million, or 21.3% (average), and $186.2 million, or 7.3% (end of period)
• Deposit balances (including repurchase agreements) declined by $81.9 million, or 2.2% (average), and decreased $217.1 million, or 5.5% (end of period)
• Tangible book value per share increased $3.18, or 18.4%, driven by strong earnings and favorable investment security and pension plan accumulated other comprehensive loss adjustments

“I am pleased with Capital City’s performance this year and am very proud of our team for achieving another year of record earnings,” said William G. Smith, Jr., Chairman, President, and CEO of Capital City Bank Group, Inc. “Amid a challenging year for our industry, our deposit franchise, disciplined credit, diversified revenues, and conservative balance sheet management resulted in strong profitability and capital growth. We are well positioned as we enter 2024 and remain focused on strategies that add long-term value for our clients and shareowners.”

Discussion of Operating Results

Net Interest Income/Net Interest Margin

Tax-equivalent net interest income for the fourth quarter of 2023 totaled $39.3 million, compared to $39.4 million for the third quarter of 2023, and $38.2 million for the fourth quarter of 2022.   For the full year of 2023, tax-equivalent net interest income totaled $159.4 million compared to $125.3 million for the same period of 2022. Compared to the third quarter of 2023, the decrease reflected higher deposit interest expense and a lower level of interest income from overnight funds, partially offset by higher loan interest due to loan growth and loan re-pricing at higher interest rates. Compared to the full year 2022, the increase reflected loan growth and higher interest rates across a majority of our earning assets, partially offset by higher deposit interest expense.

Our net interest margin for the fourth quarter of 2023 was 4.07%, an increase of four basis points over the third quarter of 2023 and an increase of 31 basis points over the fourth quarter of 2022. For the month of December 2023, our net interest margin was 4.09%. For 2023, our net interest margin was 4.05%, an increase of 91 basis points over 2022. The increase compared to all prior periods reflected a combination of earning assets re-pricing at higher interest rates and loan growth, partially offset by a higher cost of deposits. For the fourth quarter of 2023, our cost of funds was 73 basis points, an increase of 7 basis points over the third quarter of 2023 and an increase of 42 basis points over the fourth quarter of 2022. Our total cost of deposits (including noninterest bearing accounts) was 66 basis points, 58 basis points, and 20 basis points, respectively, for the same periods.

Provision for Credit Losses

We recorded a provision for credit losses of $2.0 million for the fourth quarter of 2023 compared to $2.4 million for the third quarter of 2023 and $3.6 million for the fourth quarter of 2022. The decrease in the provision compared to the third quarter of 2023 was primarily attributable to a lower level of reserves required for unfunded commitments.   For the full year of 2023, we recorded a provision for credit losses of $9.7 million compared to $7.5 million for 2022. The higher level of provision in 2023 was primarily driven by loan growth and also reflected the favorable impact in 2022 of the release of reserves held for pandemic related losses. We discuss the allowance for credit losses further below.

Noninterest Income and Noninterest Expense

Noninterest income for the fourth quarter of 2023 totaled $17.1 million compared to $16.7 million for the third quarter of 2023 and $15.3 million for the fourth quarter of 2022. The $0.4 million increase over the third quarter of 2023 reflected an increase in mortgage banking revenues of $0.5 million and wealth management fees of $0.3 million, partially offset by a decrease in deposit fees of $0.2 million and other income of $0.2 million. Compared to the fourth quarter of 2022, the $1.9 million increase was attributable to a $2.2 million increase in mortgage banking revenues and a $0.6 million increase in wealth management fees partially offset by a $0.7 million decrease in other income and a $0.2 million decrease in deposit fees.

For the full year of 2023, noninterest income totaled $71.6 million compared to $75.2 million for 2022 and reflected decreases in wealth management fees of $1.7 million, mortgage banking revenues of $1.5 million, deposit fees of $0.8 million, and bank card fees of $0.5 million, partially offset by a $0.9 million increase in other income. The decrease in wealth management fees reflected lower insurance commissions of $2.7 million due to the sale of large policies in 2022 and was partially offset by higher trust fees of $0.5 million and retail brokerage fees of $0.5 million. The decrease in mortgage banking revenues was primarily driven by lower production volume in 2023, reflective of the rapid increase in interest rates and lower market driven gain on sale margins. The decline in deposit fees reflected lower commercial account analysis fees and account service charge fees, and the reduction in bank card fees was generally due to lower card volume reflective of slower consumer spending. The increase in other income was primarily due to a $1.4 million gain from the sale of mortgage servicing rights that was partially offset by lower loan servicing income.

Noninterest expense for the fourth quarter of 2023 totaled $40.0 million compared to $39.1 million for the third quarter of 2023 and $39.3 million for the fourth quarter of 2022. The $0.9 million increase over the third quarter of 2023 was attributable to increases in compensation expense of $0.8 million and occupancy expense of $0.2 million that was partially offset by a $0.1 million decrease in other expense. The increase in compensation expense was due to a $0.8 million increase in salary expense partially attributable to a $0.5 million decrease in realized loan cost (recorded as a credit offset to salary expense) driven by lower residential loan originations. For the fourth quarter of 2023, other expense included approximately $0.6 million in professional and legal fees related to the financial statement restatement.    

Compared to the fourth quarter of 2022, the $0.7 million increase in noninterest expense reflected a $0.8 million increase in compensation expense and a $0.8 million increase in occupancy expense that was partially offset by a $0.9 million decrease in other expense. The increases in compensation expense and occupancy expense were generally driven by the same factors discussed in further detail below. The variance in other expense was primarily attributable to lower pension related costs, including the recognition of pension settlement expense of $1.7 million in the fourth quarter of 2022 whereas there was no pension settlement expense in the fourth quarter of 2023 due to a significantly lower level of retirements. A $0.7 million increase in the non-service component of pension plan expense was partially offsetting.

For the full year of 2023, noninterest expense totaled $157.0 million compared to $151.6 million for 2022 and reflected increases in occupancy expense of $3.1 million and compensation expense of $2.3 million. The increase in occupancy expense was primarily driven by the addition of four new banking offices in mid-to-late 2022 and early 2023, and to a lesser extent higher expense for property insurance (increased premiums) and maintenance agreements (network and security upgrades). The increase in compensation expense reflected a $4.7 million increase in salary expense that was partially offset by a $2.4 million decrease in associate benefit expense. The increase in salary expense was primarily due to a $3.6 million increase in base salaries (primarily the addition of staffing in new markets and annual merit), a $3.0 million reduction in realized cost (lower new residential loan originations in 2023) and higher incentive expense of $1.2 million that was partially offset by lower commission expense of $3.3 million (lower residential loan originations and insurance policy sales in 2023). The decrease in associate benefit expense reflected a $2.9 million decrease in pension plan service cost expense that was partially offset by a $0.5 million increase in associate insurance expense (higher premiums). The net variance in other expense was primarily due to lower expenses for OREO of $1.6 million (gain from the sale of a banking office in the first quarter of 2023), mortgage servicing asset amortization of $1.0 million (mid-2023 sale of servicing rights), and pension plan expense (non-service component) of $0.5 million, offset by higher expenses for professional fees of $0.8 million and FDIC insurance of $0.6 million. Further, there was no pension settlement expense in 2023 whereas we realized $2.3 million in total pension settlement expense in 2022.

Income Taxes

We realized income tax expense of $2.9 million (effective rate of 20.3%) for the fourth quarter of 2023 compared to $3.0 million (effective rate of 20.7%) for the third quarter of 2023 and $1.9 million (effective rate of 18.1%) for the fourth quarter of 2022. For the full year of 2023, we realized income tax expense of $13.0 million (effective rate of 20.4%) compared to $7.8 million (effective rate of 19.0%) for 2022.   The increase in our effective tax rate for the fourth quarter of 2023 reflected a lower level of tax benefit accrued from an investment in a solar tax credit equity fund. The increase in our effective tax rate for the full year of 2023 was attributable to a lower level of pre-tax income from our 51% owned residential mortgage subsidiary, Capital City Home Loans (“CCHL”), in relation to our consolidated income as the non-controlling interest adjustment for CCHL is accounted for as a permanent tax adjustment. Further, we recognized a lower level of tax benefit accrued from an investment in a solar tax credit equity fund. Absent discrete items or new tax credit investments, we expect our annual effective tax rate to approximate 21-22% for 2024.

Discussion of Financial Condition

Earning Assets

Average earning assets totaled $3.824 billion for the fourth quarter of 2023, a decrease of $53.0 million, or 1.4%, from the third quarter of 2023, and a decrease of $208.8 million, or 5.2%, from the fourth quarter of 2022. The decrease from both prior periods was attributable to lower deposit balances (see below – Deposits). Compared to both prior periods, the mix of earning assets improved as overnight funds were utilized to fund loan growth.

Average loans held for investment (“HFI”) increased $38.6 million, or 1.4%, over the third quarter of 2023 and $271.9 million, or 11.1%, over the fourth quarter of 2022. Period end loans increased $28.7 million, or 1.1%, over the third quarter of 2023 and $186.2 million, or 7.3%, over the fourth quarter of 2022. Compared to both prior periods, the loan growth was primarily in the residential real estate category and was partially offset by lower indirect auto and construction loan balances.

Allowance for Credit Losses

At December 31, 2023, the allowance for credit losses for HFI loans totaled $29.9 million compared to $29.1 million at September 30, 2023 and $25.1 million at December 31, 2022. Activity within the allowance is provided on Page 9. The increase in the allowance over both prior periods was driven primarily by loan growth. Further, the increase from December 31, 2022 reflected a higher loss rate for the residential real estate portfolio due to slower prepayment speeds. At December 31, 2023, the allowance represented 1.10% of HFI loans compared to 1.08% at September 30, 2023, and 0.98% at December 31, 2022.  

Credit Quality

Overall credit quality remains strong. Nonperforming assets (nonaccrual loans and other real estate) totaled $6.2 million at December 31, 2023 compared to $4.7 million at September 30, 2023 and $2.7 million at December 31, 2022. At December 31, 2023, nonperforming assets as a percent of total assets equaled 0.15%, compared to 0.11% at September 30, 2023 and 0.06% at December 31, 2022. Nonaccrual loans totaled $6.2 million at December 31, 2023, a $1.5 million increase over September 30, 2023 and a $3.9 million increase over December 31, 2022. Further, classified loans totaled $22.2 million at December 31, 2023, a $0.4 million increase over September 30, 2023 and a $2.9 million increase over December 31, 2022.

Deposits

Average total deposits were $3.549 billion for the fourth quarter of 2023, a decrease of $48.3 million, or 1.3%, from the third quarter of 2023 and a decrease of $254.5 million, or 6.7%, from the fourth quarter of 2022. Compared to both prior periods, the decreases were primarily attributable to lower noninterest bearing and savings accounts, partially offset by increases in NOW balances and certificates of deposit.  

At December 31, 2023, total deposits were $3.702 billion, an increase of $161.4 million, or 4.6%, from September 30, 2023 and a decline of $237.5 million, or 6.0%, from December 31, 2022. Our public fund deposit balances increased $234.4 million and declined $10.9 million from September 30, 2023 and December 31, 2022, respectively. Compared to September 30, 2023, the increase in public funds reflected the seasonal increase in these balances as municipal tax receipts are received.   Lower deposit balances year-over-year reflected continued client spend of stimulus savings and clients seeking higher yielding investment products outside the Bank, a portion of which have moved to our wealth division. Additionally, compared to both prior periods, we realized a remix of deposit balances of $33 million and $140 million, respectively, as noninterest bearing accounts migrated into interest bearing accounts (primarily NOW and money market accounts).

Business deposit transaction accounts classified as repurchase agreements averaged $26.8 million for the fourth quarter of 2023, an increase of $1.5 million over the third quarter of 2023 and $18.4 million over the fourth quarter of 2022. At December 31, 2023, repurchase agreement balances were $27.0 million compared to $22.9 million at September 30, 2023 and $6.6 million at December 31, 2022.

Liquidity

The Bank maintained an average net overnight funds (deposits with banks plus FED funds sold less FED funds purchased) sold position of $99.8 million in the fourth quarter of 2023 compared to $136.6 million in the third quarter of 2023 and $469.4 million in the fourth quarter of 2022. The declining overnight funds position reflected growth in average loans and lower average deposit balances.

At December 31, 2023, we had the ability to generate approximately $1.488 billion (excludes overnight funds position of $229 million) in additional liquidity through various sources including various federal funds purchased lines, Federal Home Loan Bank borrowings, the Federal Reserve Discount Window, and brokered deposits.  

We also view our investment portfolio as a liquidity source and have the option to pledge securities in our portfolio as collateral for borrowings or deposits, and/or to sell selected securities.  Our portfolio consists of debt issued by the U.S. Treasury, U.S. governmental agencies, municipal governments, and corporate entities.  At December 31, 2023, the weighted-average maturity and duration of our portfolio were 2.91 years and 2.53, respectively, and the available-for-sale portfolio had a net unrealized tax-effected loss of $22.3 million. 

Capital

Shareowners’ equity was $440.6 million at December 31, 2023 compared to $419.7 million at September 30, 2023 and $387.3 million at December 31, 2022. For the fourth quarter of 2023, the $20.9 million increase was partially attributable to a $12.5 million decrease in the accumulated other comprehensive loss including a $9.3 million net decrease in the investment securities loss and a $4.3 million decrease in the pension plan loss from the year-end re-measurement of the plan. For the full year 2023, shareowners’ equity was positively impacted by net income attributable to common shareowners of $52.3 million, a $4.1 million decrease in the accumulated other comprehensive loss for our pension plan, a $11.7 million decrease in the unrealized loss on investment securities, the issuance of stock of $2.5 million, and stock compensation accretion of $1.3 million.   Shareowners’ equity was reduced by common stock dividends of $12.9 million ($0.76 per share), the repurchase of stock of $3.7 million (122,538 shares), net adjustments totaling $1.3 million related to transactions under our stock compensation plans, and a $0.7 million decrease in the fair value of the interest rate swap related to subordinated debt.

At December 31, 2023, our total risk-based capital ratio was 16.57% compared to 16.30% at September 30, 2023 and 15.30% at December 31, 2022. Our common equity tier 1 capital ratio was 13.52%, 13.26%, and 12.38%, respectively, on these dates. Our leverage ratio was 10.30%, 9.98%, and 8.91%, respectively, on these dates. At December 31, 2023, all our regulatory capital ratios exceeded the thresholds to be designated as “well-capitalized” under the Basel III capital standards. Further, our tangible common equity ratio was 8.26% at December 31, 2023 compared to 8.08% and 6.65% at September 30, 2023 and December 31, 2022, respectively. If our unrealized held-to-maturity securities losses of $21.5 million (after-tax) were recognized in accumulated other comprehensive loss, our adjusted tangible capital ratio would be 7.74%.

About Capital City Bank Group, Inc.

Capital City Bank Group, Inc. (NASDAQ: CCBG) is one of the largest publicly traded financial holding companies headquartered in Florida and has approximately $4.3 billion in assets. We provide a full range of banking services, including traditional deposit and credit services, mortgage banking, asset management, trust, merchant services, bankcards, securities brokerage services and financial advisory services, including the sale of life insurance, risk management and asset protection services. Our bank subsidiary, Capital City Bank, was founded in 1895 and now has 63 banking offices and 103 ATMs/ITMs in Florida, Georgia and Alabama. For more information about Capital City Bank Group, Inc., visit www.ccbg.com.

FORWARD-LOOKING STATEMENTS

Forward-looking statements in this Press Release are based on current plans and expectations that are subject to uncertainties and risks, which could cause our future results to differ materially. The words “may,” “could,” “should,” “would,” “believe,” “anticipate,” “estimate,” “expect,” “intend,” “plan,” “target,” “vision,” “goal,” and similar expressions are intended to identify forward-looking statements. The following factors, among others, could cause our actual results to differ: our ability to successfully manage credit risk, interest rate risk, liquidity risk, and other risks inherent to our industry; legislative or regulatory changes; adverse developments in the financial services industry generally, such as bank failures and any related impacts on depositor behavior; the effects of changes in the level of checking or savings account deposits and the competition for deposits on our funding costs, net interest margin and ability to replace maturing deposits and advances, as necessary; inflation, interest rate, market and monetary fluctuations; uncertainty in the pricing of residential mortgage loans that we sell, as well as competition for the mortgage servicing rights related to these loans and related interest rate risk or price risk resulting from retaining mortgage servicing rights and the potential effects of higher interest rates on our loan origination volumes; the effects of actions taken by governmental agencies to stabilize the financial system and the effectiveness of such actions; changes in monetary and fiscal policies of the U.S. Government; the effects of security breaches and computer viruses that may affect our computer systems or fraud related to debit card products; the accuracy of our financial statement estimates and assumptions, including the estimates used for our allowance for credit losses, deferred tax asset valuation and pension plan; changes in our liquidity position; changes in accounting principles, policies, practices or guidelines; the frequency and magnitude of foreclosure of our loans; the effects of our lack of a diversified loan portfolio, including the risks of loan segments, geographic and industry concentrations; the strength of the United States economy in general and the strength of the local economies in which we conduct operations; our ability to declare and pay dividends, the payment of which is subject to our capital requirements; changes in the securities and real estate markets; structural changes in the markets for origination, sale and servicing of residential mortgages; risks related to changes in key personnel and any changes in our ability to retain key personnel; the effect of corporate restructuring, acquisitions or dispositions, including the actual restructuring and other related charges and the failure to achieve the expected gains, revenue growth or expense savings from such corporate restructuring, acquisitions or dispositions; the effects of natural disasters, harsh weather conditions (including hurricanes), widespread health emergencies (including pandemics, such as the COVID-19 pandemic), acts of war, terrorism, civil unrest or other geopolitical events; our ability to comply with the extensive laws and regulations to which we are subject, including the laws for each jurisdiction where we operate; the impact of the restatement of our previously issued financial statements as of and for the year ended December 31, 2022, the three months ended March 31, 2022 and 2023, the three and six months ended June 30, 2022 and 2023, and the three and nine months ended September 30, 2022; any inability to implement and maintain effective internal control over financial reporting or inability to remediate our existing material weaknesses in our internal controls deemed ineffective; the inherent limitations in internal control over financial reporting and disclosure controls and procedures; the willingness of clients to accept third-party products and services rather than our products and services and vice versa; increased competition and its effect on pricing; technological changes; the outcomes of litigation or regulatory proceedings; negative publicity and the impact on our reputation; changes in consumer spending and saving habits; growth and profitability of our noninterest income; the limited trading activity of our common stock; the concentration of ownership of our common stock; anti-takeover provisions under federal and state law as well as our Articles of Incorporation and our Bylaws; other risks described from time to time in our filings with the Securities and Exchange Commission; and our ability to manage the risks involved in the foregoing.   Additional factors can be found in our Annual Report on Form 10-K/A for the fiscal year ended December 31, 2022, and our other filings with the SEC, which are available at the SEC’s internet site (http://www.sec.gov). Forward-looking statements in this Press Release speak only as of the date of the Press Release, and we assume no obligation to update forward-looking statements or the reasons why actual results could differ, except as may be required by law.

USE OF NON-GAAP FINANCIAL MEASURESUnaudited

We present a tangible common equity ratio and a tangible book value per diluted share that removes the effect of goodwill and other intangibles resulting from merger and acquisition activity. We believe these measures are useful to investors because it allows investors to more easily compare our capital adequacy to other companies in the industry.

The GAAP to non-GAAP reconciliations are provided below.

(Dollars in Thousands, except per share data)		Dec 31, 2023		Sep 30, 2023		Jun 30, 2023		Mar 31, 2023		Dec 31, 2022
Shareowners' Equity (GAAP)		$	440,625	$	419,706	$	412,422	$	403,260	$	387,281
Less: Goodwill and Other Intangibles (GAAP)			92,933		92,973		93,013		93,053		93,093
Tangible Shareowners' Equity (non-GAAP)	A		347,692		326,733		319,409		310,207		294,188
Total Assets (GAAP)			4,304,477		4,138,287		4,391,206		4,401,762		4,519,223
Less: Goodwill and Other Intangibles (GAAP)			92,933		92,973		93,013		93,053		93,093
Tangible Assets (non-GAAP)	B	$	4,211,544	$	4,045,314	$	4,298,193	$	4,308,709	$	4,426,130
Tangible Common Equity Ratio (non-GAAP)	A/B		8.26%		8.08%		7.43%		7.20%		6.65%
Actual Diluted Shares Outstanding (GAAP)	C		17,000,590		16,997,886		17,025,023		17,049,913		17,039,401
Tangible Book Value per Diluted Share (non-GAAP)	A/C	$	20.45	$	19.22	$	18.76	$	18.19	$	17.27

CAPITAL CITY BANK GROUP, INC.
EARNINGS HIGHLIGHTS
Unaudited
		Three Months Ended						Twelve Months Ended
(Dollars in thousands, except per share data)		Dec 31, 2023		Sep 30, 2023		Dec 31, 2022		Dec 31, 2023		Dec 31, 2022
EARNINGS
Net Income Attributable to Common Shareowners	$	11,720	$	12,655	$	9,609		52,258	$	33,412
Diluted Net Income Per Share	$	0.70	$	0.74	$	0.56		3.07	$	1.97
PERFORMANCE
Return on Average Assets (annualized)		1.12	%	1.19	%	0.87	%	1.22	%	0.77	%
Return on Average Equity (annualized)		10.69		11.74		10.02		12.40		8.81
Net Interest Margin		4.07		4.03		3.76		4.05		3.14
Noninterest Income as % of Operating Revenue		30.46		29.87		28.65		31.05		37.55
Efficiency Ratio		70.82	%	69.71	%	73.41	%	67.99	%	75.62	%
CAPITAL ADEQUACY
Tier 1 Capital		15.37	%	15.11	%	14.27	%	15.37	%	14.27	%
Total Capital		16.57		16.30		15.30		16.57		15.30
Leverage		10.30		9.98		8.91		10.30		8.91
Common Equity Tier 1		13.52		13.26		12.38		13.52		12.38
Tangible Common Equity (1)		8.26		8.08		6.65		8.26		6.65
Equity to Assets		10.24	%	10.14	%	8.57	%	10.24	%	8.57	%
ASSET QUALITY
Allowance as % of Non-Performing Loans		479.70	%	619.58	%	1091.33	%	479.70	%	1091.33	%
Allowance as a % of Loans HFI		1.10		1.08		0.98		1.10		0.98
Net Charge-Offs as % of Average Loans HFI		0.23		0.17		0.21		0.18		0.18
Nonperforming Assets as % of Loans HFI and OREO		0.23		0.17		0.11		0.23		0.11
Nonperforming Assets as % of Total Assets		0.15	%	0.11	%	0.06	%	0.15	%	0.06	%
STOCK PERFORMANCE
High	$	32.56	$	33.44	$	36.23		36.86	$	36.23
Low		26.12		28.64		31.14		26.12		24.43
Close	$	29.43	$	29.83	$	32.50		29.43	$	32.50
Average Daily Trading Volume		33,297		26,774		31,894		33,775		27,987
(1) Tangible common equity ratio is a non-GAAP financial measure. For additional information, including a reconciliation to GAAP, refer to Page 6.

CAPITAL CITY BANK GROUP, INC.
CONSOLIDATED STATEMENT OF FINANCIAL CONDITION
Unaudited
	2023												2022
(Dollars in thousands)	Fourth Quarter			Third Quarter			Second Quarter			First Quarter				Fourth Quarter
ASSETS
Cash and Due From Banks	$	83,118		$	72,379		$	83,679		$	84,549		$	72,114
Funds Sold and Interest Bearing Deposits		228,949			95,119			285,129			303,403			528,536
Total Cash and Cash Equivalents		312,067			167,498			368,808			387,952			600,650
Investment Securities Available for Sale		337,902			334,052			386,220			402,943			413,294
Investment Securities Held to Maturity		625,022			632,076			641,398			651,755			660,744
Other Equity Securities		3,450			3,585			1,703			1,883			10
Total Investment Securities		966,374			969,713			1,029,321			1,056,581			1,074,048
Loans Held for Sale		28,211			34,013			44,659			28,475			26,909
Loans Held for Investment ("HFI"):
Commercial, Financial, & Agricultural		225,190			221,704			227,219			236,263			247,362
Real Estate - Construction		196,091			197,526			226,404			253,903			234,519
Real Estate - Commercial		825,456			828,234			831,285			798,438			782,557
Real Estate - Residential		1,001,257			966,512			893,384			847,697			744,167
Real Estate - Home Equity		210,920			203,606			203,142			206,931			208,217
Consumer		270,994			285,122			295,646			305,324			324,450
Other Loans		2,962			1,401			5,425			7,660			5,346
Overdrafts		1,048			1,076			1,007			931			1,067
Total Loans Held for Investment		2,733,918			2,705,181			2,683,512			2,657,147			2,547,685
Allowance for Credit Losses		(29,941	)		(29,083	)		(28,243	)		(26,808	)		(25,068	)
Loans Held for Investment, Net		2,703,977			2,676,098			2,655,269			2,630,339			2,522,617
Premises and Equipment, Net		81,266			81,677			82,062			82,055			82,138
Goodwill and Other Intangibles		92,933			92,973			93,013			93,053			93,093
Other Real Estate Owned		1			1			1			13			431
Other Assets		119,648			116,314			118,073			123,294			119,337
Total Other Assets		293,848			290,965			293,149			298,415			294,999
Total Assets	$	4,304,477		$	4,138,287		$	4,391,206		$	4,401,762		$	4,519,223
LIABILITIES
Deposits:
Noninterest Bearing Deposits	$	1,377,934		$	1,472,165		$	1,520,134		$	1,601,388		$	1,653,620
NOW Accounts		1,327,420			1,092,996			1,269,839			1,242,721			1,290,494
Money Market Accounts		319,319			304,323			321,743			271,880			267,383
Savings Accounts		547,634			571,003			590,245			617,310			637,374
Certificates of Deposit		129,515			99,958			86,905			90,621			90,446
Total Deposits		3,701,822			3,540,445			3,788,866			3,823,920			3,939,317
Repurchase Agreements		26,957			22,910			22,619			4,429			6,583
Other Short-Term Borrowings		8,384			18,786			28,054			22,203			50,210
Subordinated Notes Payable		52,887			52,887			52,887			52,887			52,887
Other Long-Term Borrowings		315			364			414			463			513
Other Liabilities		66,080			75,585			77,192			85,878			73,675
Total Liabilities		3,856,445			3,710,977			3,970,032			3,989,780			4,123,185
Temporary Equity		7,407			7,604			8,752			8,722			8,757
SHAREOWNERS' EQUITY
Common Stock		170			170			170			170			170
Additional Paid-In Capital		36,326			36,182			36,853			37,512			37,331
Retained Earnings		426,275			418,030			408,771			397,654			387,009
Accumulated Other Comprehensive Loss, Net of Tax		(22,146	)		(34,676	)		(33,372	)		(32,076	)		(37,229	)
Total Shareowners' Equity		440,625			419,706			412,422			403,260			387,281
Total Liabilities, Temporary Equity and Shareowners' Equity	$	4,304,477		$	4,138,287		$	4,391,206		$	4,401,762		$	4,519,223
OTHER BALANCE SHEET DATA
Earning Assets	$	3,957,452		$	3,804,026		$	4,042,621		$	4,045,607		$	4,177,177
Interest Bearing Liabilities		2,412,431			2,163,227			2,372,706			2,302,514			2,395,890
Book Value Per Diluted Share	$	25.92		$	24.69		$	24.21		$	23.65		$	22.73
Tangible Book Value Per Diluted Share(1)		20.45			19.22			18.76			18.19			17.27
Actual Basic Shares Outstanding		16,950			16,958			16,992			17,022			16,987
Actual Diluted Shares Outstanding		17,001			16,998			17,025			17,050			17,039
(1) Tangible book value per diluted share is a non-GAAP financial measure. For additional information, including a reconciliation to GAAP, refer to Page 6.

CAPITAL CITY BANK GROUP, INC.
CONSOLIDATED STATEMENT OF OPERATIONS
Unaudited
		2023									2022		Twelve Months Ended December 31,
(Dollars in thousands, except per share data)		Fourth Quarter		Third Quarter		Second Quarter			First Quarter		Fourth Quarter		2023		2022
INTEREST INCOME
Loans, including Fees	$	40,407	$	39,344	$	37,608		$	34,891	$	31,908	$	152,250	$	106,444
Investment Securities		4,392		4,561		4,815			4,924		4,847		18,692		15,955
Federal Funds Sold and Interest Bearing Deposits		1,385		1,848		2,782			4,111		4,463		10,126		9,511
Total Interest Income		46,184		45,753		45,205			43,926		41,218		181,068		131,910
INTEREST EXPENSE
Deposits		5,872		5,214		4,008			2,488		1,902		17,582		3,444
Repurchase Agreements		199		190		115			9		7		513		14
Other Short-Term Borrowings		310		440		336			452		683		1,538		1,747
Subordinated Notes Payable		627		625		604			571		522		2,427		1,652
Other Long-Term Borrowings		5		4		5			6		8		20		31
Total Interest Expense		7,013		6,473		5,068			3,526		3,122		22,080		6,888
Net Interest Income		39,171		39,280		40,137			40,400		38,096		158,988		125,022
Provision for Credit Losses		2,025		2,393		2,197			3,099		3,616		9,714		7,494
Net Interest Income after Provision for Credit Losses		37,146		36,887		37,940			37,301		34,480		149,274		117,528
NONINTEREST INCOME
Deposit Fees		5,304		5,456		5,326			5,239		5,536		21,325		22,121
Bank Card Fees		3,713		3,684		3,795			3,726		3,744		14,918		15,401
Wealth Management Fees		4,276		3,984		4,149			3,928		3,649		16,337		18,059
Mortgage Banking Revenues		2,327		1,839		3,363			2,871		102		10,400		11,909
Other		1,537		1,765		3,334			1,994		2,265		8,630		7,691
Total Noninterest Income		17,157		16,728		19,967			17,758		15,296		71,610		75,181
NONINTEREST EXPENSE
Compensation		23,822		23,003		23,438			23,524		23,032		93,787		91,519
Occupancy, Net		7,098		6,980		6,820			6,762		6,253		27,660		24,574
Other		9,038		9,122		10,027			7,389		9,977		35,576		35,541
Total Noninterest Expense		39,958		39,105		40,285			37,675		39,262		157,023		151,634
OPERATING PROFIT		14,345		14,510		17,622			17,384		10,514		63,861		41,075
Income Tax Expense		2,909		3,004		3,417			3,710		1,900		13,040		7,798
Net Income		11,436		11,506		14,205			13,674		8,614		50,821		33,277
Pre-Tax Loss (Income) Attributable to Noncontrolling Interest		284		1,149		(31	)		35		995		1,437		135
NET INCOME ATTRIBUTABLE TO COMMON SHAREOWNERS	$	11,720	$	12,655	$	14,174		$	13,709	$	9,609	$	52,258	$	33,412
PER COMMON SHARE
Basic Net Income	$	0.69	$	0.75	$	0.83		$	0.81	$	0.56	$	3.08	$	1.97
Diluted Net Income		0.70		0.74		0.83			0.80		0.56		3.07		1.97
Cash Dividend	$	0.20	$	0.20	$	0.18		$	0.18	$	0.17	$	0.76	$	0.66
AVERAGE SHARES
Basic		16,947		16,985		17,002			17,016		16,963		16,987		16,951
Diluted		16,997		17,025		17,035			17,045		17,016		17,023		16,985

CAPITAL CITY BANK GROUP, INC.
ALLOWANCE FOR CREDIT LOSSES ("ACL")
AND CREDIT QUALITY
Unaudited
		2023												2022			Twelve Months Ended December 31,
(Dollars in thousands, except per share data)		Fourth Quarter			Third Quarter			Second Quarter			First Quarter			Fourth Quarter			2023			2022
ACL - HELD FOR INVESTMENT LOANS
Balance at Beginning of Period	$	29,083		$	28,243		$	26,808		$	25,068		$	22,747		$	25,068		$	21,606
Transfer from Other Liabilities		66			-			-			-			-			66			-
Provision for Credit Losses		2,354			1,993			1,922			3,260			3,638			9,529			7,397
Net Charge-Offs (Recoveries)		1,562			1,153			487			1,520			1,317			4,722			3,935
Balance at End of Period	$	29,941		$	29,083		$	28,243		$	26,808		$	25,068		$	29,941		$	25,068
As a % of Loans HFI		1.10%			1.08%			1.05%			1.01%			0.98%			1.10%			0.98%
As a % of Nonperforming Loans		479.70%			619.58%			426.44%			584.18%			1,091.33%			479.70%			1,091.33%
ACL - UNFUNDED COMMITMENTS
Balance at Beginning of Period		3,502		$	3,120		$	2,833		$	2,989		$	3,012		$	2,989		$	2,897
Provision for Credit Losses		(311	)		382			287			(156	)		(23	)		202			92
Balance at End of Period(1)		3,191			3,502			3,120			2,833			2,989			3,191			2,989
ACL - DEBT SECURITIES
Provision for Credit Losses	$	(18	)	$	18		$	(12	)	$	(5	)	$	1		$	(17	)	$	5
CHARGE-OFFS
Commercial, Financial and Agricultural	$	217		$	76		$	54		$	164		$	129		$	511		$	1,308
Real Estate - Construction		-			-			-			-			-			-			-
Real Estate - Commercial		-			-			-			120			88			120			355
Real Estate - Residential		79			-			-			-			-			79			-
Real Estate - Home Equity		-			-			39			-			160			39			193
Consumer		1,689			1,340			993			1,732			976			5,754			2,901
Overdrafts		602			659			894			634			720			2,789			3,149
Total Charge-Offs	$	2,587		$	2,075		$	1,980		$	2,650		$	2,073		$	9,292		$	7,906
RECOVERIES
Commercial, Financial and Agricultural	$	83		$	28		$	71		$	95		$	25		$	277		$	307
Real Estate - Construction		-			-			1			1			-			2			10
Real Estate - Commercial		16			17			11			8			13			52			106
Real Estate - Residential		34			30			132			57			98			253			284
Real Estate - Home Equity		17			53			131			25			36			226			183
Consumer		433			418			514			571			175			1,936			1,071
Overdrafts		442			376			633			373			409			1,824			2,010
Total Recoveries	$	1,025		$	922		$	1,493		$	1,130		$	756		$	4,570		$	3,971
NET CHARGE-OFFS (RECOVERIES)	$	1,562		$	1,153		$	487		$	1,520		$	1,317		$	4,722		$	3,935
Net Charge-Offs as a % of Average Loans HFI(2)		0.23%			0.17%			0.07%			0.24%			0.21%			0.18%			0.18%
CREDIT QUALITY
Nonaccruing Loans	$	6,242		$	4,694		$	6,623		$	4,589		$	2,297
Other Real Estate Owned		1			1			1			13			431
Total Nonperforming Assets ("NPAs")	$	6,243		$	4,695		$	6,624		$	4,602		$	2,728
Past Due Loans 30-89 Days	$	6,854		$	5,577		$	4,207		$	5,061		$	7,829
Past Due Loans 90 Days or More		-			-			-			-			-
Classified Loans		22,203			21,812			14,973			12,179			19,342
Nonperforming Loans as a % of Loans HFI		0.23%			0.17%			0.25%			0.17%			0.09%
NPAs as a % of Loans HFI and Other Real Estate		0.23%			0.17%			0.25%			0.17%			0.11%
NPAs as a % of Total Assets		0.15%			0.11%			0.15%			0.10%			0.06%
(1) Recorded in other liabilities
(2) Annualized

CAPITAL CITY BANK GROUP, INC.
AVERAGE BALANCE AND INTEREST RATES
Unaudited
		Fourth Quarter 2023								Third Quarter 2023								Second Quarter 2023								First Quarter 2023								Fourth Quarter 2022									Dec 2023 YTD								Dec 2022 YTD
(Dollars in thousands)		AverageBalance			Interest		AverageRate			AverageBalance			Interest		AverageRate			AverageBalance			Interest		AverageRate			AverageBalance			Interest		AverageRate			AverageBalance			Interest		AverageRate				AverageBalance			Interest		AverageRate			AverageBalance			Interest		AverageRate
ASSETS:
Loans Held for Sale	$	49,790		$	817		6.50	%	$	62,768		$	971		6.14	%	$	54,350		$	800		5.90	%	$	55,110			644		4.74	%	$	42,910		$	582		5.38	%		$	55,510		$	3,232		5.82	%	$	48,502		$	2,175		4.49	%
Loans Held for Investment(1)		2,711,243			39,679		5.81			2,672,653			38,455		5.71			2,657,693			36,890		5.55			2,582,395			34,342		5.39			2,439,379			31,409		5.11				2,656,394			149,366		5.62			2,189,440			104,578		4.78
Investment Securities
Taxable Investment Securities		962,322			4,389		1.81			1,002,547			4,549		1.80			1,041,202			4,803		1.84			1,061,372			4,911		1.86			1,078,265			4,835		1.78				1,016,550			18,652		1.83			1,098,876			15,917		1.45
Tax-Exempt Investment Securities(1)		862			7		4.32			2,456			17		2.66			2,656			17		2.47			2,840			18		2.36			2,827			17		2.36				2,199			59		2.68			2,668			54		2.03
Total Investment Securities		963,184			4,396		1.82			1,005,003			4,566		1.81			1,043,858			4,820		1.84			1,064,212			4,929		1.86			1,081,092			4,852		1.78				1,018,749			18,711		1.83			1,101,544			15,971		1.45
Federal Funds Sold and Interest Bearing Deposits		99,763			1,385		5.51			136,556			1,848		5.37			218,902			2,782		5.10			360,971			4,111		4.62			469,352			4,463		3.77				203,147			10,126		4.98			649,762			9,511		1.46
Total Earning Assets		3,823,980		$	46,277		4.80	%		3,876,980		$	45,840		4.69	%		3,974,803		$	45,292		4.57	%		4,062,688		$	44,026		4.39	%		4,032,733		$	41,306		4.07	%			3,933,800		$	181,435		4.61	%		3,989,248		$	132,235		3.32	%
Cash and Due From Banks		76,681								75,941								75,854								74,639								74,178									75,786								76,929
Allowance for Credit Losses		(29,998	)							(29,172	)							(27,893	)							(25,637	)							(22,596	)								(28,190	)							(21,688	)
Other Assets		296,114								295,106								297,837								300,175								297,510									297,290								287,813
Total Assets	$	4,166,777							$	4,218,855							$	4,320,601							$	4,411,865							$	4,381,825								$	4,278,686							$	4,332,302
LIABILITIES:
Noninterest Bearing Deposits	$	1,416,825							$	1,474,574							$	1,539,877							$	1,601,750							$	1,662,443								$	1,507,657							$	1,691,132
NOW Accounts		1,138,461		$	3,696		1.29	%		1,125,171		$	3,489		1.23	%		1,200,400		$	3,038		1.01	%		1,228,928		$	2,152		0.71	%		1,133,733		$	1,725		0.60	%			1,172,861		$	12,375		1.06	%		1,065,838		$	2,799		0.26	%
Money Market Accounts		318,844			1,421		1.77			322,623			1,294		1.59			288,466			747		1.04			267,573			208		0.31			273,328			63		0.09				299,581			3,670		1.22			283,407			203		0.07
Savings Accounts		557,579			202		0.14			579,245			200		0.14			602,848			120		0.08			629,388			76		0.05			641,153			80		0.05				592,033			598		0.10			628,313			309		0.05
Time Deposits		116,797			553		1.88			95,203			231		0.96			87,973			103		0.47			89,675			52		0.24			92,385			34		0.15				97,480			939		0.96			94,646			133		0.14
Total Interest Bearing Deposits		2,131,681			5,872		1.09			2,122,242			5,214		0.97			2,179,687			4,008		0.74			2,215,564			2,488		0.46			2,140,599			1,902		0.35				2,161,955			17,582		0.81			2,072,204			3,444		0.17
Total Deposits		3,548,506			5,872		0.66			3,596,816			5,214		0.58			3,719,564			4,008		0.43			3,817,314			2,488		0.26			3,803,042			1,902		0.20				3,669,611			17,582		0.48			3,763,336			3,444		0.09
Repurchase Agreements		26,831			199		2.94			25,356			190		2.98			17,888			115		2.58			9,343			9		0.37			8,464			7		0.34				19,917			513		2.57			8,095			14		0.17
Other Short-Term Borrowings		16,906			310		7.29			24,306			440		7.17			17,834			336		7.54			37,766			452		4.86			42,380			683		6.39				24,146			1,538		6.37			32,388			1,747		5.40
Subordinated Notes Payable		52,887			627		4.64			52,887			625		4.62			52,887			604		4.52			52,887			571		4.32			52,887			522		3.86				52,887			2,427		4.53			52,887			1,652		3.08
Other Long-Term Borrowings		336			5		4.72			387			4		4.73			431			5		4.80			480			6		4.80			530			8		4.80				408			20		4.77			665			31		4.62
Total Interest Bearing Liabilities		2,228,641		$	7,013		1.25	%		2,225,178		$	6,473		1.15	%		2,268,727		$	5,068		0.90	%		2,316,040		$	3,526		0.62	%		2,244,860		$	3,122		0.55	%			2,259,313		$	22,080		0.98	%		2,166,239		$	6,888		0.32	%
Other Liabilities		78,772								83,099								84,305								81,206								84,585									81,842								85,684
Total Liabilities		3,724,238								3,782,851								3,892,909								3,998,996								3,991,888									3,848,812								3,943,055
Temporary Equity		7,423								8,424								8,935								8,802								9,367									8,392								9,957
SHAREOWNERS' EQUITY:		435,116								427,580								418,757								404,067								380,570									421,482								379,290
Total Liabilities, Temporary Equity and Shareowners' Equity	$	4,166,777							$	4,218,855							$	4,320,601							$	4,411,865							$	4,381,825								$	4,278,686							$	4,332,302
Interest Rate Spread				$	39,264		3.55	%				$	39,367		3.54	%				$	40,224		3.67	%				$	40,500		3.77	%				$	38,184		3.52	%					$	159,355		3.63	%				$	125,347		3.00	%
Interest Income and Rate Earned(1)					46,277		4.80						45,840		4.69						45,292		4.57						44,026		4.39						41,306		4.07							181,435		4.61						132,235		3.32
Interest Expense and Rate Paid(2)					7,013		0.73						6,473		0.66						5,068		0.51						3,526		0.35						3,122		0.31							22,080		0.56						6,888		0.17
Net Interest Margin				$	39,264		4.07	%				$	39,367		4.03	%				$	40,224		4.06	%				$	40,500		4.04	%				$	38,184		3.76	%					$	159,355		4.05	%				$	125,347		3.14	%
(1) Interest and average rates are calculated on a tax-equivalent basis using a 21% Federal tax rate.
(2) Rate calculated based on average earning assets.

For Information Contact:Jep LarkinExecutive Vice President and Chief Financial Officer850.402. 8450