Colony Bankcorp, Inc. Q1 FY2026 earnings call

• Completed core systems conversion and customer integration post - TC federal merger, positioned to deliver premier service experience. - Operating income increased $580,000 from prior quarter, expect continued improvement post - conversion with operational efficiencies and cost savings. - Margin at 3.48%, driven by acceleration of accretion income from acquired loans. Core margin expected to increase modestly, but may be a few basis points lower next quarter without pull - forward loan accretion. - Loan growth lower in Q1 due to payoffs and lighter demand from volatile rate environment, but seeing more activity in loan pipeline, still expect 8% growth for 2026. - Credit quality improved with contraction in MPLs and decline in criticized loans. - Collingwood Financial Advisors and Colony Insurance showing strong growth and improved profitability. - SBSL added national sales manager, loan pipeline improving. - Kroll Bond Rating Agency affirmed ratings with stable outlook, reflecting capital strength and stability. - Well - positioned to capitalize on industry consolidation, focusing on capturing high - quality customer relationships.

Operating income increased $580,000 from prior quarter. Operating net income was $9.5 million in first quarter. Operating pre-provision net revenue increased approximately $1.3 million to $13.9 million. Net interest income increased approximately $3.3 million. Net interest margin was 3.48%, up 16 basis points. Interest-earning assets component up 13 basis points to 5.33%, interest-bearing liabilities down 3 basis points to 2.28%. Cost of funds decreased 2 basis points to 1.94%. Operating non-interest income was $10.7 million. Operating non-interest expenses $26 million. Provision expense $1.75 million, slightly increased from prior quarter. Loan total for investment increased $32.2 million, or around 5.4% annualized. Total deposits declined slightly by $19 million. Total share repurchases were about $89,000 at an average price of $19.78. Board declared quarterly cash dividend $0.12 per share. AMCI improved quarter over quarter. TCE was 8.49%, tangible book value per share $14.65. Mortgage: pre-tax income $222,000 vs $31,000 in Q1 2025, better volume and margins but facing interest rate and housing inventory challenges. Complementary business loans: strong quarter, pre-tax income improved vs Q1 2025. Collingwood Financial Advisors: best quarter to date, AUM $555 million at end of quarter, up from $198 million in Q1 2025, strong recruiting and broker-dealer relationship change led to higher profitability. Colony Insurance: best quarter to date for pre-tax income, strong referrals from bank, recent rate reductions expected to drive more policy volume. SBSL: lighter quarter due to lower revenue and charge-off variability, loan pipeline improving, added national sales manager.

• Confident in scaling toward 1.20% ROA benchmark in Q2. - Expect margin may be a few basis points lower next quarter without additional lift of pull - forward loan accretion. - Still expect 8% loan growth for 2026. - Colony Insurance expects continued improvement in profitability due to rate reductions and better sales integration. - SBSL expects loan pipeline to improve and revenues to trend toward previous levels.

• Pandemics, variations in company's assets, businesses, cash flows, financial conditions, prospects, and other results of operations could impact forward - looking statements. - Industry consolidation creates disruptions, but also unique tailwinds; however, competition in loan pricing could impact yields. - Interest rate fluctuations and housing inventory challenges could impact mortgage business. - Variability in charge - offs for SBSL, although not seeing significant increases currently.

Q: From small business SPSL segment, is it key driver of low loss provisioning level, and loan pipeline outlook?

A: Volumes expected to pick back up, provisioning and charge - off levels to be managed with allowance backfilling, loan growth expected to increase in future quarters.

Q: Best opportunities to grow loan portfolio and current pricing?

A: Competitive pricing, around 7.11% for quarter, seeing opportunities in commercial real estate and commercial business side, yields expected to come down slightly with growth but committed to good pricing.

Q: Insurance group contribution and profitability outlook?

A: Added LOV agency, integrated better sales platform, seen uptick in referrals, expect continued improvement in pre - tax profitability with rate decreases and better integration.

Q: Merchant services business and impact on deposits and spread?

A: Merchant services a great deposit acquisition tool, banking solutions integration simplifies interaction, leads to quick relationship wins, recurring revenue business.

Q: Loan pricing outlook and expense efficiency?

A: Possibility of loan yield increase with repricing, expense efficiency focus with net NIE expected to trend toward 1.45%, merger expenses rolling off, variable expenses may increase seasonally but expect overall improvement.

Q: Post - TC Federal acquisition target sites?

A: Focus on Georgia and contiguous states, active in having conversations with management teams for strategic deals with good cultural fit, seeking alignment for more profitability, scale, and additional products/services.