Southwest Georgia Financial Corp (SGB, Financial) filed Quarterly Report for the period ended 2009-09-30.
Southwest Georgia Financial Corporation is a state-chartered bank holding company with approximately hundred ninety million in assets headquartered in Moultrie, Georgia. Its primary subsidiary, Southwest Georgia Bank, offers comprehensive financial services to consumer, business, and governmental customers. The current banking facilities include the main office located in Colquitt County, and branch offices located in Baker County, Thomas County, and Worth County. In addition to conventional banking services, the bank provides investment planning and management, trust management, mortgage banking, and commercial and individual insurance products. Insurance products and advice are provided by Southwest Georgia Insurance Services which has an office in Colquitt County. Mortgage banking for primarily commercial properties is provided by Empire Financial Services, Inc., a mortgage banking services firm. Southwest Georgia Financial Corp has a market cap of $19.75 million; its shares were traded at around $7.75 with a P/E ratio of 20.39 and P/S ratio of 1.19. Southwest Georgia Financial Corp had an annual average earning growth of 8.1% over the past 5 years.
dependent to a large extent upon net interest income, which is the difference
between the interest received on earning assets, such as loans, securities
and federal funds sold, and the interest paid on interest-bearing
liabilities, principally deposits and borrowings. Net interest income is
highly sensitive to the fluctuations in interest rates. For example, after
reaching a high of 5.25%, the Federal Reserve Bank decreased the overnight
borrowing rate for banks by 5% to a range of 0% to .25% from September 2007
to December 2008. The Federal funds rate remained at this low level during
the first nine months of 2009.
We measure our performance on selected key ratios, which are provided for the
previous five quarterly periods ended September 30, 2009.
3rd Qtr 2nd Qtr 1st Qtr 4th Qtr 3rd Qtr
2009 2009 2009 2008 2008
Return on average total assets 0.67% 0.38% 0.56% (0.17)% ( 3.99)%
Return on average total equity 7.71% 4.37% 6.48% (2.02)% (42.53)%
Average shareholders' equity
to Average total assets 8.70% 8.66% 8.62% 8.61% 9.37%
Net interest margin
(tax equivalent) 4.13% 4.12% 4.07% 4.26% 4.19%
Noninterest income, which was 27.5% of the Company's total revenue for the
quarter, increased to $1.29 million when compared with a negative $2.84
million for the third quarter of 2008. Mortgage banking services revenue,
which is a large contributor to noninterest income, decreased $6 thousand,
remaining relatively flat when compared to the same period in 2008. The
mortgage banking business services a $381 million portfolio of non-recourse
loans. Trust services and retail brokerage services revenue decreased $32
thousand, or 40%, and $33 thousand, or 38.1%, respectively, in the third
quarter of 2009. These decreases were offset by an increase in service
charges on deposit accounts of $72 thousand, or 18.0%, when compared with
last year's third quarter. A recent change in our service charge rate
structure on deposit accounts influenced the increase.
Other factors used in determining the adequacy of the reserve are
management's judgment about factors affecting loan quality and their
assumptions about the local and national economy. The allowance for loan
losses was 1.54% of total loans outstanding at September 30, 2009, compared
with 1.59% of loans outstanding at December 31, 2008 and 1.66% at September
30, 2008. Nonperforming assets totaled $3.9 million at September 30, 2009,
or 1.94% of total assets, compared with $3.7 million in nonperforming assets,
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Southwest Georgia
Financial Corporation Regulatory Guidelines
For Well Minimum
Risk Based Capital Ratios September 30, 2009 Capitalized Guidelines
Tier 1 capital 14.49% 6.00% 4.00%
Total risk based capital 15.74% 10.00% 8.00%
Tier 1 leverage ratio 8.85% 5.00% 3.00%
Southwest Georgia Bank Regulatory Guidelines
For Well Minimum
Risk Based Capital Ratios September 30, 2009 Capitalized Guidelines
Tier 1 capital 13.84% 6.00% 4.00%
Total risk based capital 15.09% 10.00% 8.00%
Tier 1 leverage ratio 8.45% 5.00% 3.00%
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Southwest Georgia Financial Corporation is a state-chartered bank holding company with approximately hundred ninety million in assets headquartered in Moultrie, Georgia. Its primary subsidiary, Southwest Georgia Bank, offers comprehensive financial services to consumer, business, and governmental customers. The current banking facilities include the main office located in Colquitt County, and branch offices located in Baker County, Thomas County, and Worth County. In addition to conventional banking services, the bank provides investment planning and management, trust management, mortgage banking, and commercial and individual insurance products. Insurance products and advice are provided by Southwest Georgia Insurance Services which has an office in Colquitt County. Mortgage banking for primarily commercial properties is provided by Empire Financial Services, Inc., a mortgage banking services firm. Southwest Georgia Financial Corp has a market cap of $19.75 million; its shares were traded at around $7.75 with a P/E ratio of 20.39 and P/S ratio of 1.19. Southwest Georgia Financial Corp had an annual average earning growth of 8.1% over the past 5 years.
Highlight of Business Operations:
The Corporation's profitability, like most financial institutions, isdependent to a large extent upon net interest income, which is the difference
between the interest received on earning assets, such as loans, securities
and federal funds sold, and the interest paid on interest-bearing
liabilities, principally deposits and borrowings. Net interest income is
highly sensitive to the fluctuations in interest rates. For example, after
reaching a high of 5.25%, the Federal Reserve Bank decreased the overnight
borrowing rate for banks by 5% to a range of 0% to .25% from September 2007
to December 2008. The Federal funds rate remained at this low level during
the first nine months of 2009.
We measure our performance on selected key ratios, which are provided for the
previous five quarterly periods ended September 30, 2009.
3rd Qtr 2nd Qtr 1st Qtr 4th Qtr 3rd Qtr
2009 2009 2009 2008 2008
Return on average total assets 0.67% 0.38% 0.56% (0.17)% ( 3.99)%
Return on average total equity 7.71% 4.37% 6.48% (2.02)% (42.53)%
Average shareholders' equity
to Average total assets 8.70% 8.66% 8.62% 8.61% 9.37%
Net interest margin
(tax equivalent) 4.13% 4.12% 4.07% 4.26% 4.19%
Noninterest income, which was 27.5% of the Company's total revenue for the
quarter, increased to $1.29 million when compared with a negative $2.84
million for the third quarter of 2008. Mortgage banking services revenue,
which is a large contributor to noninterest income, decreased $6 thousand,
remaining relatively flat when compared to the same period in 2008. The
mortgage banking business services a $381 million portfolio of non-recourse
loans. Trust services and retail brokerage services revenue decreased $32
thousand, or 40%, and $33 thousand, or 38.1%, respectively, in the third
quarter of 2009. These decreases were offset by an increase in service
charges on deposit accounts of $72 thousand, or 18.0%, when compared with
last year's third quarter. A recent change in our service charge rate
structure on deposit accounts influenced the increase.
Other factors used in determining the adequacy of the reserve are
management's judgment about factors affecting loan quality and their
assumptions about the local and national economy. The allowance for loan
losses was 1.54% of total loans outstanding at September 30, 2009, compared
with 1.59% of loans outstanding at December 31, 2008 and 1.66% at September
30, 2008. Nonperforming assets totaled $3.9 million at September 30, 2009,
or 1.94% of total assets, compared with $3.7 million in nonperforming assets,
-25-
Southwest Georgia
Financial Corporation Regulatory Guidelines
For Well Minimum
Risk Based Capital Ratios September 30, 2009 Capitalized Guidelines
Tier 1 capital 14.49% 6.00% 4.00%
Total risk based capital 15.74% 10.00% 8.00%
Tier 1 leverage ratio 8.85% 5.00% 3.00%
Southwest Georgia Bank Regulatory Guidelines
For Well Minimum
Risk Based Capital Ratios September 30, 2009 Capitalized Guidelines
Tier 1 capital 13.84% 6.00% 4.00%
Total risk based capital 15.09% 10.00% 8.00%
Tier 1 leverage ratio 8.45% 5.00% 3.00%
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