Capital City Bank Group, Inc. Reports Second Quarter 2013 Results

Capital City Bank Group, Inc. Reports Second Quarter 2013 Results

TALLAHASSEE, Fla., July 23, 2013 (GLOBE NEWSWIRE) -- Capital City Bank Group,
Inc. (Nasdaq:CCBG) today reported net income of $0.8 million, or $0.05 per
diluted share for the second quarter of 2013 compared to net income of $0.8
million, or $0.05 per diluted share for the first quarter of 2013, and a net
loss of $1.7 million, or $0.10 per diluted share, for the second quarter of
2012. For the first six months of 2013, the Company reported net income of
$1.7 million, or $0.10 per diluted share, compared to a net loss of $2.9
million, or $0.17 per diluted share for the same period in 2012.

Compared to the first quarter of 2013, performance reflects lower noninterest
expense of $0.6 million that was partially offset by a higher loan loss
provision of $0.4 million, a $0.1 million decline in operating revenues, and a
$0.1 million increase in income taxes.

Compared to the second quarter of 2012, the increase in earnings was due to a
lower loan loss provision of $4.3 million and a $1.7 million decrease in
noninterest expense, partially offset by lower operating revenues of $1.6
million and higher income taxes of $1.9 million.

The increase in earnings for the first half of 2013 versus the comparable
period in 2012 is attributable to a lower loan loss provision of $8.0 million
and a decrease in noninterest expense of $3.1 million, partially offset by
lower operating revenues of $3.2 million and higher income taxes of $3.3
million.

"The business environment is still challenging, but there have been some
notable improvements," stated William G. Smith, Jr., chairman, president and
CEO of Capital City Bank Group. "Property values are stabilizing and
disposition of our other real estate owned ("OREO") continues at a brisk pace.
Recent financials suggests our clients had a better 2012 than 2011, and
leading indicators such as past due loans and gross additions to our
non-accrual loan portfolio are at or near their lowest levels so far in this
cycle. Unemployment in our larger markets is improving, and state workers in
Florida received raises for the first time in six years. In the first half of
2013, nonperforming assets ("NPAs") are down 18% in addition to the 14%
decrease we achieved in 2012, reflecting the slowdown in problem loan inflow
and brisk ORE sales. We remain committed to our retail strategy for the
disposition of OREO and believe it provides the best economic outcome for our
shareowners. Economic uncertainty and deleveraging by consumers and
businesses have adversely impacted loan growth, which continues to place
pressure on our net interest margin. However, as the economy improves this
trend should reverse. Although choppy, we are making steady progress, and I
am encouraged about the future," said Smith.

The Return on Average Assets was 0.13% and the Return on Average Equity was
1.35% for the second quarter of 2013.These metrics were 0.13% and 1.36% for
the first quarter of 2013, and -0.26% and -2.75% for the second quarter of
2012, respectively.

For the first half of 2013, the Return on Average Assets was 0.13% and the
Return on Average Equity was 1.36% compared to -0.22% and -2.29%,
respectively, for the first half of 2012.

Discussion of Financial Condition

Average earning assets were $2.206 billion for the second quarter of 2013, a
decrease of $34.2 million, or 1.5%, from the first quarter of 2013 and an
increase of $27.7 million, or 1.4%, over the fourth quarter of 2012. The
change in earning assets from the prior quarter reflects a decline in the
overnight funds position resulting from a lower level of public fund
deposits.The increase compared to the fourth quarter of 2012 primarily
reflects the higher level of deposits resulting from an increase in the public
funds.The change in both quarters reflects the seasonal fluctuation in public
fund deposits as the fourth quarter generally reflects the seasonal low while
the first quarter the seasonal high.

We maintained an average net overnight funds (deposits with banks plus fed
funds sold less fed funds purchased)soldposition of $419.0 million during
the second quarter of 2013 compared to an average net overnight
fundssoldposition of $448.4 million in the first quarter of 2013 and an
average overnight fundssold position of $366.0 million in the fourth quarter
of 2012. The lower balance when compared to the first quarter of 2013
primarily reflects the decline in public funds and higher investment
portfolio, partially offset by a lower level of loans.The increase when
compared to the fourth quarter of 2012 reflects the declining loan portfolio
and a higher level of public funds, partially offset by an increase in the
investment portfolio.

Economic uncertainty and deleveraging by our clients continues to generate
historically high levels of liquidity, which, given the current operating
environment, are difficult to profitability deploy without taking inordinate
risks.Where practical we are working to lower the level of overnight funds by
adding to our investment portfolio with short-duration securities and reducing
deposit balances.One strategy we are using to lower deposit balances is a
fully-insured money market account which is offered by a third party and can
serve as an alternative investment for some of our higher balance depositors
while at the same time allowing us to maintain the account relationship.Until
such time that attractive investment alternatives arise, we will continue to
execute these strategies as well as seek other initiatives in an effort to
lower our overnight fund balances.

When compared to the first quarter of 2013 and fourth quarter of 2012, average
loans declined by $39.5 million and $61.4 million, respectively.Most loan
categories have experienced declines with the reduction primarily in the
commercial real estate and residential real estate categories.Our core loan
portfolio continues to be impacted by normal amortization and a higher level
of payoffs that have outpaced our new loan production.New loan production is
impacted by weak loan demand attributable to the trend toward consumers and
businesses deleveraging, lack of consumer confidence and a persistently
sluggish economy.

Efforts to stimulate new loan growth are ongoing.Without compromising our
credit standards or taking on inordinate interest rate risk, we have modified
several lending programs in our business and commercial real estate areas to
try and mitigate the significant impact that consumer and business
deleveraging is having on our portfolio.

Nonperforming assets (nonaccrual loans and OREO) totaled $96.7 million at the
end of the second quarter of 2013, a decrease of $7.2 million from the first
quarter of 2013 and $20.9 million from the fourth quarter of 2012.Nonaccrual
loans totaled $41.6 million at the end of the second quarter of 2013, a
decrease of $3.8 million from the first quarter of 2013 and $22.6 million from
the fourth quarter of 2012.Nonaccrual loan additions totaled $10.8 million in
the second quarter of 2013 and $18.5 million for the first six months of 2013,
which compares to $33.0 million in the first half of 2012.The balance of OREO
totaled $55.1 million at the end of the second quarter of 2013, a decrease of
$3.3 million from the first quarter of 2013 and an increase of $1.7 million
over the fourth quarter of 2012.For the second quarter of 2013 we added
properties totaling $4.4 million, sold properties totaling $6.6 million, and
recorded valuation adjustments totaling $1.1 million.For the first six months
of 2013, we have added properties totaling $17.3 million, sold properties
totaling $13.4 million, and recorded valuation adjustments totaling $2.2
million.Nonperforming assets represented 3.77% of total assets at June 30,
2013 compared to 3.99% at March 31, 2013 and 4.47% at December 31, 2012.

Average total deposits were $2.068 billion for the second quarter of 2013, a
decrease of $35.3 million, or 1.7%, from the first quarter of 2013 and higher
by $16.5 million, or 0.8%, from the fourth quarter of 2012. The decrease in
deposits when compared to the first quarter of 2013 resulted primarily from
the reduction in the level of public funds and certificates of deposit.When
compared to the fourth quarter of 2012, the increase was a result of higher
public funds and savings accounts, partially offset by lower certificates of
deposit and regular NOWs.

Our mix of deposits continues to improve as higher cost certificates of
deposit are replaced with lower rate non-maturity deposits and noninterest
bearing demand accounts.Prudent pricing discipline will continue to be the
key to managing our mix of deposits. Therefore, we do not attempt to compete
with higher rate paying competitors for deposits.

Average borrowings decreased by $4.8 million when compared to the first
quarter of 2013 as a result of payoff/amortization of FHLB advances, and
increased by $4.8 million when compared to the fourth quarter of 2012,
primarily a result of higher repurchase agreement balances.

Discussion of Operating Results

Tax equivalent net interest income for the second quarter of 2013 was $19.7
million compared to $20.1 million for the first quarter of 2013 and $21.2
million for the second quarter of 2012. The decrease in tax equivalent net
interest income compared to the prior periods was due to a reduction in loan
income primarily attributable to declining loan balances and unfavorable asset
repricing, partially offset by a reduction ininterest expense and a lower
level of foregone interest on loans. The lower interest expense is
attributable to favorable repricing on FHLB advances and certificates of
deposit, which reflects both lower balances and favorable repricing. For the
six months ended June 30, 2013, tax equivalent net interest income totaled
$39.8 million compared to $43.1 million for the same period of 2012.

Pressure on net interest income continues primarily as a result of the
declining loan portfolio and the low rate environment. Loans have declined by
approximately $110 million since the second quarter of 2012.The low rate
environment, although favorable to the repricing of deposits, continues to
negatively impact the loan and investment portfolios.Increased lending
competition in all markets has also unfavorably impacted the pricing for
loans.

Lowering our cost of funds, to the extent we can, and continuing to shift the
mix of our deposits will help to partially mitigate the unfavorable impact of
weak loan demand and repricing, although the impact is expected to be
minimal.

The net interest margin for the second quarter of 2013 was 3.59%, a decrease
of five basis points from the first quarter of 2013, and a decline of 18 basis
points from the second quarter of 2012. The decrease in the margin for both
comparable periods is attributable to the shift in our earning asset mix and
unfavorable asset repricing, partially offset by a lower average cost of
funds.

The provision for loan losses for the second quarter of 2013 was $1.4 million
compared to $1.1 million in the first quarter of 2013 and $5.7 million for the
second quarter of 2012.For the first six months of 2013, the loan loss
provision totaled $2.5 million compared to $10.5 million for the same period
in 2012.The increase compared to the first quarter of 2013 was primarily due
to a reserve addition for one existing impaired loan.The reduction from both
of the prior year periods reflects a declining trend in loan losses as well as
a much slower inflow of problem loans as evidenced by a lower level of loan
delinquencies, classified loans and impaired loans.Net charge-offs for the
second quarter of 2013 totaled $2.0 million, or 0.54% (annualized), of average
loanscompared to $2.4 million, or 0.66%, for the first quarter of 2013 and
$7.0 million, or 1.80%, in the second quarter of 2012.For the first half of
2013, net charge-offs totaled $4.4 million, or 0.60% (annualized), of average
loans compared to $11.6 million, or 1.48%, for the same period of 2012.Lower
charge-offs in our residential real estate and commercial real estate
portfolios drove the decrease in loan losses comparing 2013 to 2012.
Charge-offs for the first half of 2012 reflect the resolution of higher loss
exposure construction and land loans.At quarter-end, the allowance for loan
losses of $27.3 million was 1.89% of outstanding loans (net of overdrafts) and
provided coverage of 66% of nonperforming loans compared to 1.90% and 61%,
respectively, at March 31, 2013, and 1.93% and 45%, respectively, at December
31, 2012.

Noninterest income for the second quarter of 2013 totaled $13.9 million, an
increase of $0.3 million, or 1.9%, over the first quarter of 2013 and a
decrease of $0.1 million, or 0.4%, from the second quarter of 2012.The
increase over the first quarter of 2013 was driven by higher other income of
$0.2 million and bank card fees of $0.1 million.A higher level of gains from
the sale of OREO properties and an increase in miscellaneous income drove the
increase in other income.Bank card fees increased due to a higher level of
card activity.Compared to the second quarter of 2012, the decrease was
primarily due to lower deposit fees attributable to a higher level of
charged-off checking accounts.For the first six months of 2013, noninterest
income totaled $27.4 million, a $0.1 million decrease from the same period of
2012 reflective of lower deposit fees of $0.2 million, bank card fees of $0.1
million, and other income of $0.1 million, partially offset by higher mortgage
banking fees of $0.3 million and wealth management fees of $0.1 million.The
decline in deposit fees reflects a higher level of charged-off checking
accounts.Bank card fees declined due to a change in transaction mix yielding
a lower interchange rate.The decrease in other income reflects a lower level
of gains from the sale of OREO properties.Increased client trading activity
drove the improvement in wealth management fees, specifically retail brokerage
fees.The increase in mortgage fees was attributable to a higher level of
loans funded and a higher margin for sold loans.

Noninterest expense for the second quarter of 2013 totaled $30.6 million, a
decrease of $0.6 million, or 2.0%, from the first quarter of 2013 attributable
to lower OREO expense of $0.5 million and reductions in premises expense of
$0.1 million and furniture/equipment expense of $0.1 million.The decrease in
OREO expense was due to a reduction in losses from the sale of
properties.Declines were realized in most of the premises and
furniture/equipment expense categories and were generally driven by stronger
cost controls and other cost reduction initiatives.Compared to the second
quarter of 2012, noninterest expense decreased by $1.7 million, or 5.3%,
reflective of a decline in OREO expense of $1.0 million, a reduction in both
premises and furniture expense totaling $0.4 million, and lower other expense
of $0.8 million, partially offset by higher compensation expense of $0.5
million.For the first six months of 2013, noninterest expense totaled $61.8
million, a decrease of $3.1 million, or 4.8%, from the same period of 2012
attributable to lower OREO expense of $1.6 million, declines in both premises
and furniture/equipment expense totaling $0.4 million, and lower other expense
of $1.3 million, partially offset by higher compensation expense of $0.4
million.The reduction in OREO expense from both prior year periods was
attributable to a lower level of losses from the sale of properties and lower
valuation adjustments.Lower carrying costs for properties also contributed to
the reduction for the six month period.Compared to both prior year periods
declines were realized in most of the premises and furniture/equipment expense
categories and were generally driven by stronger cost controls and other cost
reduction initiatives.Reductions in legal fees, professional fees,
advertising costs, and postage costs drove the decline in other expense from
both prior year periods.Severance costs recorded in the second quarter of
2012 related to the closing of banking offices and outsourcing of our items
processing function also contributed to the favorable variance in other
expense.Higher stock compensation expense and pension expense partially
offset by lower salary expense drove the increases in compensation expense
from both prior year periods. 

About Capital City Bank Group, Inc.

Capital City Bank Group, Inc. (Nasdaq:CCBG) is one of the largest publicly
traded bank holding companies headquartered in Florida and has approximately
$2.6 billion in assets.The Company provides a full range of banking services,
including traditional deposit and credit services, asset management, trust,
mortgage banking, merchant services, bankcards, data processing and securities
brokerage services.The Company's bank subsidiary, Capital City Bank, was
founded in 1895 and now has 63 full-service offices and 71 ATMs 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 the Company's future results to differ materially.The following
factors, among others, could cause the Company's actual results to differ: the
Company's need and our ability to incur additional debt or equity financing;
the accuracy of the Company's financial statement estimates and assumptions,
including the estimate used for the Company's loan loss provision and deferred
tax valuation allowance; a decrease to the market value of the Company that
could result in an impairment of goodwill; legislative or regulatory changes,
including the Dodd-Frank Act and Basel III; the strength of the U.S. economy
and the local economies where the Company conducts operations; the frequency
and magnitude of foreclosure of the Company's loans; restrictions on our
operations, including the inability to pay dividends without our regulators'
consent; the effects of the health and soundness of other financial
institutions; the effects of the Company's lack of a diversified loan
portfolio, including the risks of geographic and industry concentrations;
harsh weather conditions and man-made disasters; fluctuations in inflation,
interest rates, or monetary policies; changes in the stock market and other
capital and real estate markets; customer acceptance of third-party products
and services;increased competition and its effect on pricing, including the
long-term impact on our net interest margin from the repeal of Regulation Q;
negative publicity and the impact on our reputation;technological changes,
especially changes that allow out of market competitors to compete in our
markets;the effects of security breaches and computer viruses that may affect
the Company's computer systems; changes in consumer spending and savings
habits; the Company's growth and profitability;changes in accounting; and the
Company's ability to manage the risks involved in the foregoing.Additional
factors can be found in the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 2012, and the Company's 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 the Company assumes no
obligation to update forward-looking statements or the reasons why actual
results could differ.

CAPITAL CITY BANK GROUP,                                        
INC.
EARNINGS HIGHLIGHTS                                             
Unaudited                                                       

                        Three Months Ended               Six Months Ended
(Dollars in thousands,   Jun 30,   Mar 31,   Jun 30, 2012 Jun 30,   Jun 30,
except per share data)   2013      2013                   2013      2012
                                                               
EARNINGS                                                        
Net Income (Loss)        $843    $839    $(1,726)   $1,682  $(2,888)
Net Income (Loss) Per    $0.05   $0.05   $(0.10)    $0.10   $(0.17)
Common Share
PERFORMANCE                                                     
Return on Average Assets 0.13%     0.13%     -0.26%       0.13%     -0.22%
Return on Average Equity 1.35%     1.36%     -2.75%       1.36%     -2.29%
Net Interest Margin      3.59%     3.64%     3.77%        3.61%     3.82%
Noninterest Income as %  41.68%    40.62%    39.88%       41.15%    39.26%
of Operating Revenue
Efficiency Ratio         91.07%    92.67%    91.18%       91.87%    91.61%
CAPITAL ADEQUACY                                                
Tier 1 Capital Ratio     15.36%    14.95%    14.17%       15.36%    14.17%
Total Capital Ratio      16.73%    16.32%    15.54%       16.73%    15.54%
Tangible Common Equity   6.64%     6.49%     6.40%        6.64%     6.40%
Ratio
Leverage Ratio           10.07%    9.81%     9.60%        10.07%    9.60%
Equity to Assets         9.73%     9.54%     9.41%        9.73%     9.41%
ASSET QUALITY                                                   
Allowance as % of        65.66%    61.17%    40.03%       65.66%    40.03%
Non-Performing Loans
Allowance as a % of      1.89%     1.90%     1.93%        1.89%     1.93%
Loans
Net Charge-Offs as % of  0.54%     0.66%     1.80%        0.60%     1.48%
Average Loans
Nonperforming Assets as  6.44%     6.81%     8.23%        6.44%     8.23%
% of Loans and ORE
Nonperforming Assets as  3.77%     3.99%     5.02%        3.77%     5.02%
% of Total Assets
STOCK PERFORMANCE                                               
High                    $12.64  $12.54  $8.73      $12.64  $9.91
Low                      10.12     10.95     6.35         10.12     6.35
Close                    11.53     12.35     7.37         11.53     7.37
Average Daily Trading    $16,366 $23,519 $37,926    $19,827 $31,391
Volume
                                                               

CAPITAL CITY BANK                                                  
GROUP, INC.
CONSOLIDATED STATEMENT OF FINANCIAL                                              
CONDITION
Unaudited                                                          

                                           
                  2013                      2012
(Dollars in        Second       First        Fourth       Third        Second
thousands)         Quarter      Quarter      Quarter      Quarter      Quarter
ASSETS                                                             
Cash and Due From  $67,811    $52,677    $66,238    $53,076    $57,477
Banks
Funds Sold and
Interest Bearing   391,457      461,714      443,494      314,318      434,814
Deposits
Total Cash and     459,268     514,391     509,732     367,394     492,291
Cash Equivalents
                                                                  
Investment
Securities,        350,614      307,502      296,985      288,166      280,753
Available-for-Sale
                                                                  
Loans, Net of                                                      
Unearned Interest
Commercial,
Financial, &       126,931      125,905      139,850      135,939      136,736
Agricultural
Real Estate -      40,726       42,968       43,740       43,278       46,803
Construction
Real Estate -      581,501      599,517      613,625      609,671      605,819
Commercial
Real Estate -      312,714      311,189      318,400      341,044      353,198
Residential
Real Estate - Home 232,530      233,205      236,263      239,446      242,929
Equity
Consumer           142,620      146,043      150,728      154,389      162,899
Other Loans        5,904        5,187        11,547       6,891        5,638
Overdrafts         2,554        2,307        7,149        2,637        2,214
Total Loans, Net
of Unearned        1,445,479   1,466,321   1,521,302   1,533,295   1,556,236
Interest
Allowance for Loan (27,294)     (27,803)     (29,167)     (30,222)     (29,929)
Losses
Loans, Net         1,418,185   1,438,518   1,492,135   1,503,073   1,526,307
                                                                  
Premises and       104,743      105,883      107,092      109,003      110,302
Equipment, Net
Intangible Assets  84,937       84,985       85,053       85,161       85,269
Other Real Estate  55,087       58,421       53,426       53,172       58,059
Owned
Other Assets       89,024       95,613       89,561       87,815       92,869
Total Other Assets 333,791      344,902      335,132      335,151      346,499
                                                                  
Total Assets       $2,561,858 $2,605,313 $2,633,984 $2,493,784 $2,645,850
                                                                  
LIABILITIES                                                        
Deposits:                                                          
Noninterest        $644,739   $616,017   $609,235   $596,660   $623,130
Bearing Deposits
NOW Accounts       706,101      765,030      842,435      703,327      789,103
Money Market       287,340      299,118      267,766      285,084      288,352
Accounts
Regular Savings    204,594      200,492      184,541      181,523      178,388
Accounts
Certificates of    228,349      233,325      241,019      254,000      271,413
Deposit
Total Deposits     2,071,123    2,113,982    2,144,996    2,020,594    2,150,386
                                                                  
Short-Term         46,081       50,682       47,435       42,388       69,449
Borrowings
Subordinated Notes 62,887       62,887       62,887       62,887       62,887
Payable
Other Long-Term    41,251       41,224       46,859       38,126       38,846
Borrowings
Other Liabilities  91,227       87,930       84,918       79,427       75,260
                                                                  
Total Liabilities  2,312,569    2,356,705    2,387,095    2,243,422    2,396,828
                                                                  
SHAREOWNERS'                                                       
EQUITY
Common Stock       173          173          172          172          172
Additional Paid-In 40,210       39,580       38,707       38,493       38,260
Capital
Retained Earnings  239,251      238,408      237,569      235,694      234,573
Accumulated Other
Comprehensive      (30,345)     (29,553)     (29,559)     (23,997)     (23,983)
Loss, Net of Tax
                                                                  
Total Shareowners' 249,289      248,608      246,889      250,362      249,022
Equity
                                                                  
Total Liabilities
and Shareowners'   $2,561,858 $2,605,313 $2,633,984 $2,493,784 $2,645,850
Equity
                                                                  
OTHER BALANCE                                                      
SHEET DATA
Earning Assets     $2,187,549 $2,235,537 $2,261,781 $2,135,779 $2,271,803
Intangible Assets                                                  
Goodwill           84,811       84,811       84,811       84,811       84,811
Core Deposits      --           --           19           79           139
Other              126          174          223          271          319
Interest Bearing   1,576,601    1,652,758    1,692,942    1,567,335    1,698,438
Liabilities
                                                                  
Book Value Per     $14.36     $14.35     $14.31     $14.54     $14.48
Diluted Share
Tangible Book
Value Per Diluted  9.47         9.44         9.38         9.59         9.52
Share
                                                                  
Actual Basic       17,336       17,319       17,232       17,223       17,198
Shares Outstanding
Actual Diluted     17,372       17,326       17,259       17,223       17,198
Shares Outstanding
                                                                  

CAPITAL CITY
BANK GROUP,                                                         
INC.
CONSOLIDATED
STATEMENT OF                                                        
OPERATIONS
Unaudited                                                           

                                                          Six Months Ended
            2013                2012                           June 30,
(Dollars in
thousands,   Second    First     Fourth    Third     Second     2013      2012
except per   Quarter   Quarter   Quarter   Quarter   Quarter
share data)
                                                                   
INTEREST                                                            
INCOME
Interest and
Fees on      $19,709 $20,154 $20,756 $21,274 $21,359  $39,863 $43,364
Loans
Investment   710       704       808       798       834        1,414     1,734
Securities
Funds Sold   279       270       223       254       244        549       468
Total
Interest     20,698    21,128    21,787    22,326    22,437     41,826    45,567
Income
                                                                   
INTEREST                                                            
EXPENSE
Deposits     367       415       429       480       556        782       1,199
Short-Term   61        82        69        71        48         143       56
Borrowings
Subordinated
Notes        342       339       351       372       372        681       754
Payable
Other
Long-Term    333       347       383       372       396        680       832
Borrowings
Total
Interest     1,103     1,183     1,232     1,295     1,372      2,286     2,841
Expense
Net Interest 19,595    19,945    20,555    21,031    21,065     39,540    42,726
Income
Provision
for Loan     1,450     1,070     2,766     2,864     5,743      2,520     10,536
Losses
Net Interest
Income after
Provision    18,145    18,875    17,789    18,167    15,322     37,020    32,190
for Loan
Losses
                                                                   
NONINTEREST                                                         
INCOME
Deposit Fees 6,217     6,165     6,764     6,406     6,313      12,382    12,622
Data
Processing   670       653       671       687       680        1,323     1,355
Fees
Wealth
Management   1,901     1,915     1,818     1,686     1,904      3,816     3,677
Fees
Mortgage     968       1,043     910       978       864        2,011     1,712
Banking Fees
Bank Card    2,754     2,661     2,612     2,616     2,784      5,415     5,555
Fees
Other       1,339     1,151     1,343     1,202     1,361      2,490     2,571
Total
Noninterest  13,849    13,588    14,118    13,575    13,906     27,437    27,492
Income
                                                                   
NONINTEREST                                                         
EXPENSE
Compensation 16,647    16,739    15,772    15,510    16,117     33,386    32,960
Premises     2,149     2,265     2,217     2,345     2,303      4,414     4,590
Furniture
and          2,012     2,153     2,212     2,245     2,245      4,165     4,446
Equipment
Intangible   48        68        108       108       107        116       215
Amortization
Other Real   2,408     2,884     1,900     2,603     3,432      5,292     6,925
Estate
Other       7,318     7,091     7,259     7,390     8,089      14,409    15,754
Total
Noninterest  30,582    31,200    29,468    30,201    32,293     61,782    64,890
Expense
                                                                   
OPERATING
PROFIT       1,412     1,263     2,439     1,541     (3,065)    2,675     (5,208)
(LOSS)
Income Tax
Expense      569       424       564       420       (1,339)    993       (2,320)
(Benefit)
NET INCOME   $843    $839    $1,875  $1,121  $(1,726) $1,682  $(2,888)
(LOSS)
                                                                   
PER SHARE                                                           
DATA
Basic Income $0.05   $0.05   $0.11   $0.07   $(0.10)  $0.10   $(0.17)
(Loss)
Diluted
Income       $0.05   $0.05   $0.11   $0.07   $(0.10)  $0.10   $(0.17)
(Loss)
AVERAGE                                                             
SHARES
Basic       17,319    17,302    17,229    17,215    17,192     17,311    17,187
Diluted     17,355    17,309    17,256    17,228    17,192     17,364    17,187
                                                                   

CAPITAL CITY BANK GROUP,                                        
INC.
ALLOWANCE FOR LOAN                                              
LOSSES
AND NONPERFORMING ASSETS                                        
Unaudited                                                       

                        2013      2013       2012       2012       2012
(Dollars in thousands,   Second    First      Fourth     Third      Second
except per share data)   Quarter   Quarter    Quarter    Quarter    Quarter
                                                               
ALLOWANCE FOR LOAN                                              
LOSSES
Balance at Beginning of  $27,803 $29,167  $30,222  $29,929  $31,217
Period
Provision for Loan       1,450     1,070      2,766      2,864      5,743
Losses
Net Charge-Offs          1,959     2,434      3,821      2,571      7,031
Balance at End of Period $27,294 $27,803  $29,167  $30,222  $29,929
As a % of Loans          1.89%     1.90%      1.93%      1.97%      1.93%
As a % of Nonperforming  65.66%    61.17%     45.42%     40.80%     40.03%
Loans
                                                               
CHARGE-OFFS                                                     
Commercial, Financial    $119    $154     $166     $331     $57
and Agricultural
Real Estate -            110       610        227        127        275
Construction
Real Estate - Commercial 1,050     1,043      468        512        3,519
Real Estate -            1,053     683        2,877      981        3,894
Residential
Real Estate - Home       322       113        745        834        425
Equity
Consumer                 351       296        488        355        550
Total Charge-Offs        $3,005  $2,899   $4,971   $3,140   $8,720
                                                               
RECOVERIES                                                      
Commercial, Financial    38        51         87         53         83
and Agricultural
Real Estate -            --      --       7         9         27
Construction
Real Estate - Commercial 144       38         468        34         42
Real Estate -            396       96         83         76         969
Residential
Real Estate - Home       224       18         250        15         116
Equity
Consumer                 244       262        255        382        452
Total Recoveries         $1,046  $465     $1,150   $569     $1,689
                                                               
NET CHARGE-OFFS          $1,959  $2,434   $3,821   $2,571   $7,031
                                                               
Net Charge-Offs as a %   0.54%     0.66%      1.00%      0.66%      1.80%
of Average Loans^(1)
                                                               
RISK ELEMENT ASSETS                                             
Nonaccruing Loans        $41,566 $45,448  $64,222  $74,075  $74,770
Other Real Estate Owned  55,087    58,421     53,426     53,172     58,059
Total Nonperforming      $96,653 $103,869 $117,648 $127,247 $132,829
Assets
                                                               
Past Due Loans 30-89     $9,017  $9,274   $9,934   $12,923  $16,695
Days
Past Due Loans 90 Days   --        --         --         --         --
or More
Performing Troubled Debt $52,729 $53,108  $47,474  $45,973  $38,734
Restructuring's
                                                               
Nonperforming Loans as a 2.88%     3.10%      4.22%      4.83%      4.80%
% of Loans
Nonperforming Assets as
a % ofLoans and Other   6.44%     6.81%      7.47%      8.02%      8.23%
Real Estate
Nonperforming Assets as  3.77%     3.99%      4.47%      5.10%      5.02%
a % of Total Assets
                                                               
(1) Annualized                                                  
                                                               

CAPITAL CITY
BANK GROUP,                                                                                                                                       
INC.
AVERAGE
BALANCE AND                                                                                                                                       
INTEREST
RATES^(1)
Unaudited                                                                                                                                         

                                                                                                                                    
            Second Quarter 2013            First Quarter 2013             Fourth Quarter 2012            Third Quarter 2012             Second Quarter 2012
(Dollars in  Average      Interest  Average Average      Interest  Average Average      Interest  Average Average      Interest  Average Average      Interest  Average
thousands)   Balance                Rate    Balance                Rate    Balance                Rate    Balance                Rate    Balance                Rate
ASSETS:                                                                                                                                           
Loans, Net
of Unearned  $1,456,904 19,790   5.45%   $1,496,432 20,228   5.48%   $1,518,280 20,837   5.46%   $1,541,262 21,366   5.51%   $1,570,827 21,456   5.49%
Interest
                                                                                                                                                 
Investment                                                                                                                                        
Securities
Taxable
Investment   225,770     578      1.02    215,087     590      1.10    219,985     697      1.26    214,431     691      1.28    216,952     730      1.35
Securities
Tax-Exempt
Investment   104,981      200       0.76    80,946       174       0.86    74,647       172       0.92    67,446       163       0.97    63,715       161       1.01
Securities
                                                                                                                                                 
Total
Investment   330,751     778      0.94    296,033     764      1.04    294,632     869      1.17    281,877     854      1.21    280,667     891      1.27
Securities
                                                                                                                                                 
Funds Sold   419,039      279       0.27    448,424      270       0.24    366,034      223       0.24    386,027      254       0.26    411,353      244       0.24
                                                                                                                                                 
Total
Earning      2,206,694   $20,847 3.79%   2,240,889   $21,262 3.85%   2,178,946   $21,929 4.00%   2,209,166   $22,474 4.05%   2,262,847   $22,591 4.01%
Assets
                                                                                                                                                 
Cash and Due 49,081                      50,679                      51,344                      47,207                      47,711               
From Banks
Allowance
for Loan     (29,012)                    (30,467)                    (30,605)                    (30,260)                    (31,599)             
Losses
Other Assets 337,765                      337,579                      334,326                      340,126                      345,458               
                                                                                                                                                 
Total Assets $2,564,528                 $2,598,680                 $2,534,011                 $2,566,239                 $2,624,417          
                                                                                                                                                 
LIABILITIES:                                                                                                                                      
Interest
Bearing                                                                                                                                           
Deposits
NOW Accounts $716,459   $124    0.07%   $788,660   $156    0.08%   $714,682   $131    0.07%   $740,178   $144    0.08%   $809,172   $167    0.08%
Money Market 289,637     54       0.07    282,847     54       0.08    275,458     57       0.08    287,250     60       0.08    280,371     63       0.09
Accounts
Savings      202,784     25       0.05    193,033     23       0.05    182,760     23       0.05    179,445     23       0.05    174,923     21       0.05
Accounts
Time         231,134      164       0.29    238,441      181       0.31    247,679      218       0.35    263,007      253       0.38    274,497      305       0.45
Deposits
Total
Interest     1,440,014   367      0.10%   1,502,981   414      0.11%   1,420,579   429      0.12%   1,469,880   480      0.13%   1,538,963   556      0.15%
Bearing
Deposits
                                                                                                                                                 
Short-Term   52,399      61       0.47%   55,255      82       0.60%   45,893      69       0.59%   59,184      71       0.48%   57,983      48       0.33%
Borrowings
Subordinated
Notes        62,887      342      2.15    62,887      339      2.15    62,887      351      2.19    62,887      372      2.31    62,887      372      2.34
Payable
Other
Long-Term    40,942       333       3.26    42,898       348       3.29    42,673       383       3.57    38,494       372       3.85    40,617       396       3.92
Borrowings
                                                                                                                                                 
Total
Interest     1,596,242   $1,103  0.28%   1,664,021   $1,183  0.29%   1,572,032   $1,232  0.31%   1,630,445   $1,295  0.32%   1,700,450   $1,372  0.32%
Bearing
Liabilities
                                                                                                                                                 
Noninterest
Bearing      627,633                     599,986                     630,520                     605,602                     596,690              
Deposits
Other        90,168                       85,116                       78,442                       78,446                       74,633                
Liabilities
                                                                                                                                                 
Total        2,314,043                    2,349,123                    2,280,994                    2,314,493                    2,371,773             
Liabilities
                                                                                                                                                 
SHAREOWNERS' 250,485                      249,557                      253,017                      251,746                      252,644               
EQUITY:
                                                                                                                                                 
Total
Liabilities
and          $2,564,528                 $2,598,680                 $2,534,011                 $2,566,239                 $2,624,417          
Shareowners'
Equity
                                                                                                                                                 
Interest                 $19,744 3.51%               $20,079 3.56%               $20,697 3.69%               $21,179 3.73%               $21,219 3.69%
Rate Spread
                                                                                                                                                 
Interest
Income and               20,847    3.79                21,262    3.85                21,929    4.00                22,474    4.05                22,591    4.01
Rate
Earned^(1)
Interest
Expense and              1,103     0.20                1,183     0.21                1,232     0.22                1,295     0.23                1,372     0.24
Rate
Paid^(2)
                                                                                                                                                 
Net Interest             $19,744 3.59%               $20,079 3.64%               $20,697 3.78%               $21,179 3.82%               $21,219 3.77%
Margin
                                                                                                                                                 
                                                                                                                                                 
^(1)Interest and average rates are calculated on a tax-equivalent basis using the 35% Federal tax rate.
^(2)Rate calculated based on average earning assets.

                                                                 
CAPITAL CITY                                                      
BANK GROUP, INC.
AVERAGE BALANCE
AND INTEREST                                                      
RATES^(1)
Unaudited                                                         

                                                                 
                Jun 2013 YTD                   Jun 2012 YTD
(Dollars in      Average      Interest  Average Average      Interest  Average
thousands)       Balance                Rate    Balance                Rate
ASSETS:                                                           
Loans, Net of
Unearned         $1,476,559 $40,018 5.47%   $1,583,654 $43,577 5.53%
Interest
                                                                 
Investment                                                        
Securities
Taxable
Investment       220,458     1,168    1.03    229,716     1,524    1.35
Securities
Tax-Exempt
Investment       93,030       374       0.80    60,014       323       1.08
Securities
                                                                 
Total Investment 313,488     1,542    0.98    289,730     1,847    1.28
Securities
                                                                 
Funds Sold       433,650      549       0.26    392,193      469       0.24
                                                                 
Total Earning    2,223,697   $42,109 3.82%   2,265,577   $45,893 4.07%
Assets
                                                                 
Cash and Due     49,875                      48,569               
From Banks
Allowance for    (29,735)                    (31,491)             
Loan Losses
Other Assets     337,673                      348,007               
                                                                 
Total Assets     $2,581,510                 $2,630,662          
                                                                 
LIABILITIES:                                                      
Interest Bearing                                                  
Deposits
NOW Accounts     $752,360   $280    0.08%   $816,289   $359    0.09%
Money Market     286,261     108      0.08    278,964     137      0.10
Accounts
Savings Accounts 197,935     48       0.05    170,263     42       0.05
Time Deposits    234,768      346       0.30    279,314      661       0.48
Total Interest   1,471,324   782      0.11%   1,544,830   1,199    0.16%
Bearing Deposits
                                                                 
Short-Term       53,819      143      0.54%   51,814      56       0.22%
Borrowings
Subordinated     62,887      681      2.15    62,887      754      2.37
Notes Payable
Other Long-Term  41,915       680       3.27    42,451       832       3.94
Borrowings
                                                                 
Total Interest
Bearing          1,629,945   $2,286  0.28%   1,701,982   $2,841  0.34%
Liabilities
                                                                 
Noninterest      613,886                     603,691              
Bearing Deposits
Other            87,656                       71,444                
Liabilities
                                                                 
Total            2,331,487                    2,377,117             
Liabilities
                                                                 
SHAREOWNERS'     250,023                      253,545               
EQUITY:
                                                                 
Total
Liabilities and  $2,581,510                 $2,630,662          
Shareowners'
Equity
                                                                 
Interest Rate                $39,823 3.54%               $43,052 3.73%
Spread
                                                                 
Interest Income
and Rate                     42,109    3.82                45,893    4.07
Earned^(1)
Interest Expense
and Rate                     2,286     0.21                2,841     0.25
Paid^(2)
                                                                 
Net Interest                 $39,823 3.61%               $43,052 3.82%
Margin
                                                                 
^(1)Interest and average rates are calculated on a tax-equivalent basis using
the 35% Federal tax rate.
^(2)Rate calculated based on average earning assets.

CONTACT: J. Kimbrough Davis
         Executive Vice President
         and Chief Financial Officer
         850.402.7820
 
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