Colony Bankcorp Reports Third-Quarter 2026 Results and Declares $0.12 Quarterly Cash Dividend
Colony Bankcorp, Inc. (NYSE: CBAN), the parent company of Colony Bank, has announced its financial results for the third quarter of 2026, reporting continued profitability, stronger net interest income, and improvements in operating earnings compared with the previous quarter and the same period last year. The company also announced a quarterly cash dividend of $0.12 per common share, reflecting its ongoing commitment to delivering value to shareholders.
For the quarter ended September 30, 2026, Colony Bankcorp reported net income of $10.5 million, equivalent to $0.50 per diluted share. Although net income declined slightly from $10.9 million, or $0.51 per diluted share, in the second quarter of 2026, it increased significantly compared with $5.8 million, or $0.33 per diluted share, reported in the third quarter of 2025.
Operating performance also improved year over year. Operating net income reached $11.6 million, or $0.54 per diluted share, compared with $11.0 million, or $0.52 per diluted share, in the second quarter of 2026. In the third quarter of 2025, operating net income was $8.2 million, or $0.47 per diluted share. These results demonstrate continued growth in the company’s underlying earnings, supported by higher net interest income, improving margins, and contributions from its lending and fee-generating businesses.
Colony Bankcorp Declares Quarterly Cash Dividend
Colony Bankcorp’s Board of Directors declared a quarterly cash dividend of $0.12 per share on October 28, 2026. The dividend is scheduled to be paid on November 25, 2026, to shareholders of record at the close of business on November 11, 2026.
The dividend announcement provides shareholders with a regular cash distribution while the company continues to manage its balance sheet, invest in its banking operations, and prepare for its planned partnership with First Reliance Bancshares, Inc.
As of October 26, 2026, Colony Bankcorp had 21,220,149 shares of common stock outstanding. The company’s dividend decision comes amid continued earnings growth compared with the previous year and a capital position that remains above the applicable regulatory minimums for a well-capitalized institution.
Management Highlights Earnings Progress and Strategic Priorities
Heath Fountain, Chief Executive Officer of Colony Bankcorp, said the company was pleased with its third-quarter financial performance, highlighting solid execution and sustained profitability across its core business.
According to Fountain, the progress achieved over recent quarters reflects the resilience of Colony Bankcorp’s business model and its focus on disciplined balance sheet management, operating efficiency, and sound credit quality. Management believes these priorities will remain important as the company navigates changing market conditions and advances its strategic initiatives.
Fountain also noted that loan growth moderated during the third quarter as the company maintained pricing discipline in a changing interest-rate environment. While the company continues to pursue its long-term lending growth objectives, management expects loan growth to remain softer in the near term.
The company reported continued improvement in its net interest margin, supported by higher yields on earning assets and consistent pricing on new and renewed loans. These factors have helped strengthen the bank’s ability to generate income from its lending and investment activities.
Management also provided an update on the planned partnership with First Reliance Bancshares. The company previously announced that all necessary regulatory and shareholder approvals had been obtained. Both organizations are preparing for the legal closing and subsequent systems conversion and customer integration, which are currently expected to take place in the second quarter of 2027.
Fountain said the combination is expected to allow both organizations to build on their existing strengths, improve operational execution, and pursue opportunities that support long-term value for shareholders, customers, and the communities they serve.
Balance Sheet Shows Moderate Loan Growth
Colony Bankcorp reported total assets of $3.65 billion as of September 30, 2026, representing an increase of $20.3 million from June 30, 2026. The increase reflects changes in the company’s lending activities, deposits, borrowings, and other balance sheet components during the quarter.
Total loans, excluding loans held for sale, reached $2.48 billion at the end of the third quarter. This represented an increase of $12.3 million, or approximately 0.50%, compared with the previous quarter.
The moderate pace of loan growth reflects management’s emphasis on maintaining appropriate pricing and underwriting standards rather than pursuing volume without regard to risk or profitability. In a changing interest-rate environment, disciplined lending can help banks preserve margins and manage exposure to potential credit deterioration.
Although near-term loan growth may remain subdued, Colony Bankcorp indicated that its longer-term lending objectives have not changed. The company continues to focus on generating profitable business while maintaining credit quality and supporting customers across its markets.
Deposits and Borrowings Reflect Funding Adjustments
Total deposits stood at approximately $2.96 billion on September 30, 2026, compared with approximately $2.97 billion on June 30, 2026. Deposits declined by $14.5 million during the quarter as changes across deposit categories partially offset one another.
Noninterest-bearing demand deposits decreased by $6.8 million, while interest-bearing demand deposits declined by $44.1 million. These reductions were partially offset by a $15.1 million increase in savings and money market deposits and a $21.4 million increase in time deposits.
The changes indicate that the composition of the bank’s funding base continued to shift during the quarter. Deposit mix is an important consideration for banks because the cost of funding influences net interest income and profitability. Changes in demand deposits, savings accounts, money market balances, and time deposits can affect the average cost of funds and the bank’s overall liquidity management.
Total borrowings increased by $30.0 million from June 30, 2026, reaching $263.2 million at September 30, 2026. Borrowings can provide additional funding flexibility as a bank manages lending demand, liquidity requirements, and deposit fluctuations. However, their cost and maturity profile remain important factors in managing funding expenses and interest-rate exposure.
Net Interest Income and Margin Continue to Improve
Net interest income was one of the principal drivers of Colony Bankcorp’s year-over-year earnings improvement. On a tax-equivalent basis, net interest income reached $30.5 million in the third quarter of 2026, compared with $22.9 million in the third quarter of 2025.
For the first nine months of 2026, tax-equivalent net interest income totaled $89.9 million, up from $66.6 million during the corresponding period in 2025.
The quarterly improvement was supported by an increase of $9.5 million in income from interest-earning assets, which reached $46.6 million. Interest expense on interest-bearing liabilities also increased, rising by $1.9 million to $16.1 million. However, the increase in interest income was substantially greater than the rise in interest expense, supporting higher net interest income.
For the nine months ended September 30, 2026, income from interest-earning assets increased by $27.8 million to $137.6 million. Interest expense on interest-bearing liabilities rose by $4.5 million to $47.7 million over the same period.
Net interest margin also improved. The company’s net interest margin reached 3.59% in the third quarter of 2026, compared with 3.17% in the third quarter of 2025. For the first nine months of 2026, the margin was 3.53%, up from 3.07% in the comparable period of 2025.
Management attributed the improvement to several factors, including the acquisition of TC Bancshares, Inc., completed in the fourth quarter of 2025, higher yields on interest-earning assets, and a lower cost of funds. Net interest margin is a key banking performance measure because it indicates how effectively a financial institution earns income from interest-generating assets relative to the cost of its funding.
The sustained improvement in this measure provides an important contribution to the company’s earnings performance, although future results will continue to depend on interest rates, deposit pricing, lending activity, and the composition of its balance sheet.
Noninterest Income Benefits From Multiple Business Lines
Colony Bankcorp reported noninterest income of $12.3 million in the third quarter of 2026, an increase of $2.2 million, or 21.6%, compared with the third quarter of 2025.
For the nine months ended September 30, 2026, noninterest income totaled $35.1 million, up $5.9 million, or 20.1%, from the same period in the previous year.
The growth reflected contributions from several areas of the business, including service charges on deposits, mortgage fee income, interchange fees, bank-owned life insurance income, and wealth advisory services. The company also recorded an insurance gain of $813,000 in the third quarter related to a previous branch building fire. This gain was included in other noninterest income.
In addition, bank-owned life insurance income included a tax-free gain of $706,000 recorded in the second quarter of 2026. These items contributed to the company’s reported noninterest income during the nine-month period.
The increase in noninterest income was partially offset by lower gains on sales of Small Business Administration loans. SBA lending and loan sales remain part of Colony Bankcorp’s broader lending activities, but gains from such transactions can fluctuate depending on production volumes, loan-sale activity, and market conditions.
Diversification across fee-generating businesses can help banks reduce their dependence on interest income alone. Service charges, mortgage operations, payment-related fees, and wealth advisory activities provide additional revenue sources, although these businesses can also be affected by customer activity, economic conditions, and transaction volumes.
Noninterest Expenses Reflect Growth and Integration Costs
Noninterest expense totaled $27.6 million in the third quarter of 2026, compared with $24.6 million in the third quarter of 2025. For the first nine months of 2026, noninterest expense reached $81.8 million, compared with $66.8 million in the same period a year earlier.
The increases were primarily associated with salaries and employee benefits, occupancy and equipment, information technology, and acquisition and integration-related costs.
Some of these expenses relate to the acquisition of TC Bancshares, Inc., which took place in the fourth quarter of 2025. The company also incurred expenses associated with its planned merger with First Reliance Bancshares, Inc.
Acquisitions can create opportunities to expand a bank’s geographic reach, customer base, and product offerings. However, they can also require investments in technology, employee integration, operational processes, and systems conversion. These costs may affect short-term profitability while the organization works to realize the benefits of combining operations.
Colony Bankcorp’s ability to manage expenses will remain an important factor in its financial performance. The company is focused on operational efficiency while preparing for the next stage of its strategic development.
Mortgage and SBA Lending Activities
Colony Bankcorp continued to generate business through its mortgage and Small Business Specialty Lending operations during the third quarter.
Mortgage production totaled $96.5 million in the third quarter of 2026, compared with $115.4 million in the second quarter. Mortgage sales, meanwhile, increased to $69.2 million from $67.3 million in the preceding quarter.
The figures show that mortgage production declined sequentially while mortgage sales increased. Production and sales are distinct measures: production reflects the volume of mortgages originated, whereas sales reflect loans sold during the reporting period. Their relationship can influence fee income, liquidity, and the amount of mortgage loans retained on the balance sheet.
The company’s Small Business Specialty Lending division closed $29.9 million in SBA loans during the third quarter, up from $13.0 million in the second quarter of 2026. SBA loan sales reached $12.7 million, compared with $5.5 million in the preceding quarter.
The increase in SBA loan closings and sales indicates stronger activity in this segment compared with the second quarter. Small-business lending provides banks with opportunities to serve business owners while generating interest income and, where applicable, income from loan sales. Results will depend on borrower demand, underwriting standards, and broader economic conditions.
Asset Quality and Credit Risk Monitoring
Colony Bankcorp continued to monitor its credit portfolio as nonperforming assets increased during the third quarter.
Nonperforming assets totaled $25.0 million at September 30, 2026, compared with $20.9 million at June 30, 2026, an increase of $4.1 million. Other real estate owned and repossessed assets also increased, reaching $3.9 million at the end of the third quarter compared with $2.0 million at the end of the second quarter.
Net loans charged off amounted to $1.7 million, representing 0.27% of average loans in the third quarter of 2026. In the second quarter, net charge-offs were $1.8 million, or 0.29% of average loans. The quarterly figures indicate a modest reduction in both the dollar amount of net charge-offs and the charge-off ratio.
The allowance for credit losses on loans stood at $22.5 million, equal to 0.91% of total loans, at September 30, 2026. At June 30, 2026, the allowance was $22.0 million, or 0.89% of total loans.
The allowance represents management’s estimate of expected credit losses within the loan portfolio. Its adequacy is assessed in the context of portfolio composition, borrower performance, economic conditions, and other relevant risk factors.
The company also reported an increase in classified and criticized loans, primarily driven by the downgrade of one construction lending relationship involving circumstances specific to the individual borrower. Such classifications help banks identify loans that require closer monitoring and determine whether additional risk-management measures are necessary.
Although the increase in nonperforming assets warrants attention, the reduction in quarterly net charge-offs and the increase in the allowance for credit losses provide additional context for assessing the company’s credit performance. Future asset quality will depend on borrower repayment capacity, property and business conditions, and the effectiveness of the bank’s underwriting and monitoring practices.
Capital Position Remains Above Regulatory Requirements
Colony Bankcorp reported a solid capital position at September 30, 2026, with preliminary capital ratios above the applicable regulatory minimums required for a bank to be considered well-capitalized.
The company’s preliminary consolidated tier one leverage ratio was 10.57%. Its tier one capital ratio was 14.41%, while the total risk-based capital ratio reached 16.78%. The common equity tier one capital ratio stood at 13.50%.
Capital ratios are important indicators of a bank’s ability to absorb unexpected losses, support lending activity, and maintain financial stability. Strong capital levels can also provide flexibility as financial institutions pursue acquisitions, invest in technology, and respond to changes in market conditions.
For Colony Bankcorp, maintaining capital strength will be particularly important as it continues integrating the TC Bancshares acquisition and prepares for its planned partnership with First Reliance.
First Reliance Partnership Remains a Strategic Priority
Colony Bankcorp continues to prepare for its planned partnership with First Reliance Bancshares, Inc. The company has stated that the necessary regulatory and shareholder approvals have been obtained, and both organizations are working toward a smooth legal closing and subsequent integration.
Systems conversion and customer integration are currently expected in the second quarter of 2027. Preparations include coordinating technology platforms, operational procedures, and customer-facing processes to support the transition.
Management believes the partnership will provide an opportunity to combine the organizations’ strengths and enhance their ability to serve customers and communities. The successful execution of the transaction will depend on effective planning, integration management, and continued attention to customer service and operational continuity.
Colony Bankcorp enters the final quarter of 2026 with year-over-year improvements in net income, operating earnings, net interest income, and noninterest income. Its capital ratios remain above applicable well-capitalized regulatory thresholds, while its loan portfolio continues to expand at a measured pace.
At the same time, management expects near-term loan growth to remain softer as the company maintains pricing discipline. Higher noninterest expenses, integration costs, and the increase in nonperforming assets are additional factors that investors will monitor in upcoming reporting periods.
The company’s performance will continue to be influenced by interest-rate conditions, deposit competition, credit quality, mortgage and SBA lending activity, and the management of acquisition-related expenses.
With the declaration of its $0.12 quarterly cash dividend and preparations for the planned First Reliance partnership, Colony Bankcorp is focusing on balancing shareholder returns, disciplined growth, operational efficiency, and long-term strategic development.
The third-quarter results highlight progress in several core earnings measures while also showing the importance of continued expense control and credit risk management. As the company moves toward the end of 2026 and prepares for its anticipated 2027 integration milestones, its ability to sustain margin improvements, manage funding costs, and maintain sound asset quality will remain central to its financial performance.
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