Southwest Georgia Financial Corporation, a full-service community bank holding company, today reported its results of operations for the first quarter ended March 31, 2015. 

First Quarter Income Highlights

• Net income increased 15.4% to $809 thousand, or $0.32 per diluted share, from $701 thousand, or $0.28 per diluted share, in the first quarter of 2014.
• Net interest income improved 7.2% to $3.4 million when compared with last year’s first quarter, due to lower interest expense and higher interest income.The provision for loan loss was reduced more than 50% to $45 thousand due to improved asset quality.
• Noninterest income declined to $1.2 million for the first quarter of 2015, primarily due to a $155 thousand net gain on the sale of securities that benefited the prior-year period.Decreased mortgage banking income was partially offset by higher income from trust, brokerage and insurance services.
• Noninterest expense fell slightly to $3.5 million as lower personnel expenses more than offset higher occupancy, data processing and equipment expenses.

Balance Sheet Trends and Asset Quality

• Total assets at March 31, 2015 were $399.9 million, up from $394.8 million at March 31, 2014.  The change in asset mix reflects higher loans and investment securities and decreased overnight balances.
• Investment securities increased $19.1 million to $118.7 million compared with the first quarter last year.  The portfolio was rebalanced in anticipation of an expected rise in short term rates and a flattening of the yield curve.  Most of the investment securities growth occurred in the intermediate term. 
• Total loans grew $7.3 million to $230.2 million compared with first quarter 2014, contributing to increased revenue in spite of lower yields.
• Deposits grew $3.9 million to $334.8 million compared with the first quarter of 2014 on higher noninterest-bearing and NOW accounts.
• Asset quality remains strong with extraordinarily low levels of non-performing assets.

Capital Management

• The Corporation has a Total Risk-Based Capital Ratio of 15.52% and a Leverage Capital Ratio of 8.96%, both measurably above the federal “well capitalized” standard.  
• Return on equity increased to 9.21% compared with 8.71% in the first quarter of 2014. 
• Tangible book value per share at March 31, 2015 was $13.85, up 9.5% from $12.65 in first quarter of 2014.

“Our solid execution, community bank business model, and our focus on deepening customer relationships have driven our strong performance.  We are growing low-cost core funding and originating high quality loans.  We are particularly encouraged by the year-over-year loan growth, which reflects new lending activity across our entire footprint,” commented DeWitt Drew, President and CEO.  “We will continue to proactively manage our asset mix to be in a position to drive expansion of our net interest margin when the interest rate environment improves.  Additionally, we expect to benefit from what appears to be a strengthening of our local economies, in spite of a slight weakening in the agricultural sector.” 

Dividends 

In March 2015, the Corporation paid a first quarter cash dividend of $0.10 per common share, an increase from $0.08 per common share paid quarterly in 2014. Southwest Georgia Financial Corporation or its predecessor, Southwest Georgia Bank, has paid cash dividends for 87 consecutive years.