CAPITAL CITY BANK GROUP INC (CCBG) FY 2024 MD&A
This page reproduces the company's own Item 7 MD&A text from the linked SEC filing. It is filer text, not grepcent analysis, scoring, or investment advice.
Management’s Discussion and Analysis of
Financial Condition and Results of Operations under the section captioned
“Business Overview” for discussion related to the expansion of our
Business.
Competition
We face significant
competition in our market areas. We
compete against a wide range of banking and nonbanking institutions
including banks, savings and loan associations, credit unions, money market
funds, mutual fund advisory companies, mortgage
banking companies, investment banking companies, insurance agencies and
companies, securities firms, brokerage firms,
financial technology firms, finance companies and other types of financial
institutions. Some of our competitors are larger
financial institutions with greater resources and, as such, may have higher
lending limits and may offer other services that are not
provided by us. However, we believe that the
larger financial institutions are less familiar with the markets in which we operate
and typically target a different client base. We
also believe clients who bank at community banks tend to prefer the relationship
style service of community banks compared to larger banks and
financial services companies.
As a result, we expect to be able to effectively compete in our markets
with larger financial institutions through providing
superior client service and leveraging our knowledge and experience
in providing banking products and services in our market
areas. See Item 1A. Risk Factors under the section captioned “Our future success is dependent
on our ability to compete
effectively in the highly competitive banking and financial
services industry” for further discussion related to the competitive
environment in which we operate.
Our primary market area consists of 21 counties in Florida, six counties in Georgia,
and one county in Alabama. Most of Florida’s
major banking concerns have a presence in Leon County,
where our main office is located.
Our Leon County deposits totaled
$1.200 billion, or 32.7% of our consolidated deposits at December 31, 2024.
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The table below depicts our market share percentage within each county,
based on commercial bank deposits within the county.
Market Share as of June 30,
(1)
County
2024
2023
2022
Florida
Alachua
4.9%
5.1%
4.9%
Bay
0.2%
0.3%
0.3%
Bradford
34.3%
37.1%
34.9%
Citrus
4.3%
4.4%
4.7%
Clay
2.2%
2.4%
2.3%
Dixie
21.5%
17.5%
19.8%
Gadsden
81.8%
81.9%
82.1%
Gilchrist
41.6%
42.2%
41.2%
Gulf
11.2%
12.4%
14.8%
Hernando
5.2%
4.9%
5.0%
Jefferson
24.6%
28.3%
24.8%
Leon
15.5%
16.9%
15.4%
Levy
26.4%
26.4%
25.4%
Madison
13.5%
13.5%
14.0%
Putnam
28.3%
34.4%
26.4%
St. Johns
0.7%
0.8%
0.7%
Suwannee
6.4%
6.6%
7.0%
Taylor
73.7%
75.0%
73.8%
Wakulla
8.4%
8.4%
10.0%
Walton
0.6%
0.3%
-
Washington
7.8%
9.2%
11.2%
Georgia
Bibb
3.1%
2.9%
3.2%
Cobb
0.1%
0.1%
0.0%
Gwinnett
(2)
0.0%
0.0%
-
Grady
14.0%
13.8%
16.3%
Laurens
6.0%
6.7%
7.8%
Troup
5.4%
5.6%
6.4%
Alabama
Chambers
9.0%
8.6%
9.3%
(1)
Obtained from the FDIC Summary of Deposits Report for the year indicated.
(2)
Bank office opened in the second quarter of 2023.
Seasonality
We believe our
commercial banking operations are not generally seasonal in nature; however,
public deposits tend to increase
with tax collections in the fourth and first quarters of each year and decline
as a result of governmental spending thereafter.
Human Capital Matters
Our culture distinguishes us from our competitors and is the driving force
behind our continued success. Our leadership is
committed to a culture that values people alongside results.
Our brand promise (“More than your bank. Your
banker.”)
and purpose (“We
empower our clients’ financial wellness and help
them build secure futures”), together with our core values statement (“Do
the Right Thing, Build Relationships & Loyalty,
Embrace Individuality & Value
Others, Promote Career Growth, Be Committed to Community,
and Represent the Star (our bank)
Proudly”), are the foundation on which our culture is built.
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The bank has grown significantly since its beginnings in 1895. Our commitment
to fostering a culture that values our associates
across our entire footprint remains unwavering. We
have a Chief Culture Officer and a Chief Inclusion Officer
who make it a
priority to ensure our culture is maintained and associates exemplify our values.
At December 31, 2024, we had approximately 940 full-time associates and
approximately 29 part-time associates. At December
31, 2024, approximately 68% of our workforce was female, 32% was male,
and approximately 21% was ethnic minorities. None
of our associates are represented by a labor union or covered by a collective bargaining
agreement.
Our commitment to people and being an employer with integrity and heart has
earned us numerous accolades including:
one of
the “Best Companies to Work
for in Florida” by Florida Trend for 13 consecutive
years, a “Best Bank to Work
For” by American
Bankers for 12 consecutive years and being named by Forbes in 2023 and 2024
as one of “America’s Best-in-State Banks,
a
selection made from direct consumer feedback and online reviews.
The average tenure of our associates is approximately 9.4 years, and
the average tenure of our management team is 23.9 years.
Tenure statistics support
these accolades and further demonstrate that associates enjoy working
for CCBG.
Compensation and Benefits Program
. To attract and retain experienced
associates we offer a competitive compensation and
benefits program, foster a culture where everyone feels included and empowered
to do to their best work, and give associates the
opportunity to give back to their communities and make a social impact.
Our compensation program is designed to attract and reward talented individuals
who possess the skills necessary to support our
business objectives, assist in the achievement of our strategic goals and
create long-term value for our shareowners. We
provide
our associates with compensation packages that include base salary and
annual incentive bonuses, and certain associates can
receive equity awards tied to the Company’s
performance.
Experience has taught us that a compensation program with both
short-
and long-term awards provides fair and competitive
compensation and aligns associate and shareowner interests by incentivizing
business and individual performance. This dual
approach also encourages long-term company performance and integrates compensation
with our business plans.
In addition to cash and equity compensation, we offer associates benefits
including life and health (medical, dental & vision)
insurance, paid time off, an associate stock purchase plan, and a
401(k) plan. Associates hired prior to 2020 are eligible to
participate in a pension plan.
A core value is providing associates the ability to “grow a career.”
To that end, we support and encourage
associates to develop a
life-long habit of continuous learning that focuses on personal and professional
development through higher education. We
offer
an educational Tuition Assistance Plan to help eligible
associates continue or begin post-high school education, develop skills,
increase knowledge and aid in career development.
We have invested
in tools and capabilities that allow our team members to work remotely as appropriate.
Inclusion.
Integral to our culture and values is a commitment to an equitable, diverse, and inclusive work
environment whereby
respect, acceptance and belonging are practiced and experienced by all.
Our associates are our most valuable assets, and our differences make
us stronger. The individual perspectives,
life experiences,
capabilities and talents, which our associates invest in their work, represent a
significant part of our culture, reputation and
collective achievements.
The Chief Inclusion Officer and the Inclusion Council, which comprises
diverse associates from various levels and offices
throughout our organization, connect the company’s
diversity and inclusion initiatives with our broader business strategies.
A
diverse team produces more creative solutions, offers better client
service and is vital to attracting and retaining talent—key
factors that contribute to our success. We
continue to build an inclusive culture through a variety of inclusion initiatives
for
internal promotions and hiring practices.
Health and Safety
. Our business success is fundamentally connected to our associates’ well-being.
We make available to our
associates a voluntary wellness program,
StarFit that provides associates with resources and good-health opportunities through
exercise, diet and preventive care.
In response to emerging workplace practices, we made changes to our
flex–work program to assist our associates in maintaining a
work/life balance consistent with their professional and personal goals.
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Social Matters
Community Involvement.
We aim to give back
to the communities where we live and work and believe that this commitment
helps in our efforts to attract and retain associates. Our commitment
to help our community starts with our associates. Community
involvement is a hallmark for our organization, and it comes naturally
to our associates. We encourage
our associates to volunteer
their hours with service organizations and philanthropic groups in
the communities we serve.
We recorded
9,542 community service hours in 2024, and 10,526, and 9,508 hours in 2023 and 2022,
respectively. Additionally,
the CCBG Foundation donated approximately $0.3 million in 2024 and 2023
and approximately $0.2 million in 2022 to various
non-profit organizations in the communities we serve.
Since 2015, we have annually supported the United Way
of the Big Bend in analyzing financial information for its annual grant
review process. Many of these grants are provided to low-moderate income
communities in the Big Bend area.
Access, affordability,
and financial inclusion.
Our community commitment to further financial literacy in the markets we service
remains an ongoing focus. In 2024, the CCBG Foundation made grants totaling
$167,000 to Community Reinvestment Act of
1977 (“CRA”) eligible organizations in our market
area. We are committed
to providing educational outreach regarding home
ownership and financial access for minorities. We
are a long-time supporter of Habitat for Humanity,
with our associates
providing volunteer hours on home builds.
During 2020 to 2023, we partnered with Habitat for Humanity and Warrick
Dunn
Charities to build and furnish four homes.
Further, we continue to originate loans under the Habitat for
Humanity loan program
and community development loans under various affordable
housing, community service, and revitalization projects.
During tax season, we provide locations for community residents to access Volunteer
Income Tax Assistance (VITA)
services.
VITA is a nationwide
IRS program that offers free tax preparation assistance to people who generally
make $60,000 or less,
persons with disabilities, the elderly,
and limited English-speaking taxpayers who need assistance in preparing their
own tax
returns.
Environmental Matters
We recognize
the value of environmental stewardship and seek opportunities to reduce our carbon
footprint and incorporate
energy efficiency products into business operations.
We have implemented
company-wide recycling programs and have
converted exterior lighting to LED at 58 offices. Further reducing
our environmental impact, our office model design is reduced
from an average 5,500 square feet to 3,300 square feet. As we renovate or build
new facilities, we employ energy efficient
equipment such as HVAC
systems and lighting controls in offices.
In 2022 through 2024, we made commitments for a $7 million investment in SOLCAP 2022
-1, LLC, a $7 million investment in
SOLCAP 2023-1, LLC, and an $9.1 million investment in SOLCAP 2024-1, LLC. Each of these funds
were formed to make solar
tax equity investments in renewable solar energy projects and
provided us with tax credits and other tax benefits. These projects
will produce approximately 31,778,716 kw hours of clean power each
year. The clean power produced is equivalent
to removing
approximately 21,350 metric tons of greenhouse gas emissions. We
plan to continue to review these kinds of investment
opportunities as they arise.
We work to ensure
lending activities do not encourage business activities that could cause irreparable
damage to our reputation or
the environment. In general, we evaluate each credit or transaction
on its individual merits, with larger deals receiving more
attention and deeper analysis, including a review of environmental matters
related to certain real estate loans, which is overseen
by our Credit Risk Oversight Committee.
To prepare for any climate-related
occurrences, we have a business continuity plan that addresses how to maintain
business
operations in the event of a disastrous event. We
also offer disaster assistance to our associates, which includes
accommodation/shelter reimbursement in case of evacuations or sustained
power outages.
Regulatory Considerations
We
must comply with state and federal banking laws and regulations
that control virtually all aspects of our operations.
These
laws and regulations generally aim to
protect our depositors, not necessarily our shareowners
or our creditors. Any changes in
applicable laws or regulations may materially
affect our business and prospects. Proposed
legislative or regulatory changes may
also affect our operations. The following description summarizes some of the
laws and regulations to which we are
subject.
References to applicable statutes and
regulations are brief summaries,
do not purport to be complete, and are qualified
in their
entirety by reference
to such statutes and regulations.
12
Capital City Bank Group, Inc.
We are registered
with the Board of Governors of the Federal Reserve System (the “Federal Reserve”) as a bank
holding
company under the Bank Holding Company Act of 1956 (“BHC Act”) and have
also elected to be a financial holding company.
As a result, we are subject to supervisory regulation and examination by the
Federal Reserve. The BHC Act, the Dodd-Frank Wall
Street Reform and Consumer Protection Act (the “Dodd-Frank Act”),
the Gramm-Leach-Bliley Financial Modernization Act (the
“GLBA”), and other federal laws subject financial holding companies
to restrictions on the types of activities in which they may
engage, and to a range of supervisory requirements and activities, including regulatory
enforcement actions for violations of laws
and regulations.
Permitted Activities
The GLBA reformed the U.S. banking system by: (i) allowing bank holding
companies (“BHCs”) that qualify as “financial
holding companies,” such as CCBG, to engage in a broad range of financial
and related activities; (ii) allowing insurers and other
financial service companies to acquire banks; (iii) removing restrictions that applied
to bank holding company ownership of
securities firms and mutual fund advisory companies; and (iv) establishing
the overall regulatory scheme applicable to bank
holding companies that also engage in insurance and securities operations.
The general effect of the law was to establish a
comprehensive framework to permit affiliations among
commercial banks, insurance companies, securities firms, and other
financial service providers. Activities that are financial in nature are broadly
defined to include not only banking, insurance, and
securities activities, but also merchant banking and additional activities that the
Federal Reserve, in consultation with the
Secretary of the Treasury,
determines to be financial in nature, incidental to such financial activities, or complementary
activities
that do not pose a substantial risk to the safety and soundness of depository
institutions or the financial system generally.
In contrast to financial holding companies, bank holding companies
are limited to managing or controlling banks, furnishing
services to or performing services for its subsidiaries, and engaging
in other activities that the Federal Reserve determines by
regulation or order to be so closely related to banking or managing or
controlling banks as to be a proper incident thereto. In
determining whether a particular activity is permissible, the Federal Reserve
must consider whether the performance of such an
activity reasonably can be expected to produce benefits to the public
that outweigh possible adverse effects. Possible benefits
include greater convenience, increased competition, and gains in efficiency.
Possible adverse effects include undue concentration
of resources, decreased or unfair competition, conflicts of interest, and unsound
banking practices. Despite prior approval, the
Federal Reserve may order a bank holding company or its subsidiaries to terminate
any activity or to terminate ownership or
control of any subsidiary when the Federal Reserve has reasonable cause
to believe that a serious risk to the financial safety,
soundness or stability of any bank subsidiary of that bank holding company
may result from such an activity.
Changes in Control
Subject to certain exceptions, the BHC Act and the Change in Bank Control Act
(“CBCA”), together with the applicable
regulations, require Federal Reserve approval (or,
depending on the circumstances, no notice of disapproval) prior to any
acquisition of “control” of a bank or bank holding company.
Under the BHC Act, a company (a broadly defined term that includes
partnerships among other things) that acquires the power,
directly or indirectly, to direct
the management or policies of an insured
depository institution or to vote 25% or more of any class of voting securities of
any insured depository institution is deemed to
control the institution and to be a bank holding company.
A company that acquires less than 5% of any class of voting security
(and that does not exhibit the other control factors) is presumed not to have control.
For ownership levels between the 5% and
25% thresholds, the Federal Reserve has developed an extensive body of
law on the circumstances in which control may or may
not exist.
Under the CBCA, if an individual or a company that acquires 10% or more of any
class of voting securities of an insured
depository institution or its holding company and either that institution or
company has registered securities under Section 12 of
the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or no
other person will own a greater percentage of that
class of voting securities immediately after the acquisition, then that investor is presumed
to have control and may be required to
file a change in bank control notice with the institution’s
or the holding company’s primary
federal regulator. Our common
stock
is registered under Section 12 of the Exchange Act, so we are subject to these rules.
As a financial holding company,
we are required to obtain prior approval from the Federal Reserve before (i) acquiring
all or
substantially all of the assets of a bank or bank holding company,
(ii) acquiring direct or indirect ownership or control of more
than 5% of the outstanding voting stock of any bank or bank holding company
(unless we own a majority of such bank’s voting
shares), or (iii) acquiring, merging or consolidating with
any other bank or bank holding company.
In determining whether to
approve a proposed bank acquisition, federal bank regulators will consider,
among other factors, the effect of the acquisition on
competition, the public benefits expected to be received from the acquisition,
the projected capital ratios and levels on a post-
acquisition basis, and the companies’ records of addressing the credit needs of
the communities they serve, including the needs of
low and moderate income neighborhoods, consistent with the safe and sound
operation of the bank, under the CRA.
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Under Florida law,
a person or entity proposing to directly or indirectly acquire control of a Florida chartered
bank must also
obtain permission from the Florida Office of Financial
Regulation (the “Florida OFR”). The Florida Statutes define “control”
as
either (i) indirectly or directly owning, controlling or having power to vote
25% or more of the voting securities of a bank; (ii)
controlling the election of a majority of directors of a bank; (iii) owning,
controlling, or having power to vote 10% or more of the
voting securities as well as directly or indirectly exercising a controlling
influence over management or policies of a bank; or (iv)
as determined by the
Florida OFR. These requirements will affect us because the Bank is chartered
under Florida law and
changes in control of CCBG are indirect changes in control of CCB.
Prohibitions Against Tying Arrangements
Banks are subject to the prohibitions on certain tying arrangements.
We
are prohibited, subject to some exceptions, from
extending credit to or offering any other service, or fixing
or varying the consideration for such extension of credit or service, on
the condition that the customer obtain some additional service from
the institution or its affiliates or not obtain services of a
competitor of the institution.
Capital; Dividends; Source of Strength
The Federal Reserve imposes certain capital requirements on financial
holding companies under the BHC Act, including a
minimum leverage ratio and a minimum ratio of “qualifying” capital
to risk-weighted assets. These requirements are described
below under “Capital Regulations.” Subject to these capital requirements
and certain other restrictions, we are generally able to
borrow money to make a capital contribution to CCB, and such loans
may be repaid from dividends paid from CCB to us.
We
are
also able to raise capital for contributions to CCB by issuing securities without having
to receive regulatory approval, subject to
compliance with federal and state securities laws.
It is the Federal Reserve’s policy
that bank holding companies should generally pay dividends on common
stock only out of
income available over the past year,
and only if prospective earnings retention is consistent with the organization’s
expected
future needs and financial condition. It is also the Federal Reserve’s
policy that bank holding companies should not maintain
dividend levels that undermine their ability to be a source of strength to
their banking subsidiaries. Additionally,
the Federal
Reserve has indicated that bank holding companies should carefully
review their dividend policies and has discouraged payment
ratios that are at maximum allowable levels unless both asset quality and capital
are very strong. The Federal Reserve possesses
enforcement powers over bank holding companies and their non-bank subsidiaries
to prevent or remedy actions that represent
unsafe or unsound practices or violations of applicable statutes and regulations.
Among these powers is the ability to proscribe the
payment of dividends by banks and bank holding companies.
Bank holding companies are expected to consult with the Federal Reserve before
redeeming any equity or other capital instrument
included in Tier 1 or Tier
2 capital prior to stated maturity,
if such redemption could have a material effect on the level or
composition of the organization’s
capital base. In addition, a bank holding company may not repurchase
shares equal to 10% or
more of its net worth if it would not be well-capitalized (as defined by the
Federal Reserve) after giving effect to such repurchase.
Bank holding companies experiencing financial weaknesses, or
that are at significant risk of developing financial weaknesses,
must consult with the Federal Reserve before redeeming or repurchasing
common stock or other regulatory capital instruments.
In accordance with Federal Reserve policy,
which has been codified by the Dodd-Frank Act, we are expected to act as a source of
financial strength to CCB and to commit resources to support CCB in circumstances
in which we might not otherwise do so. In
furtherance of this policy,
the Federal Reserve may require a financial holding company to terminate any
activity or relinquish
control of a nonbank subsidiary (other than a nonbank subsidiary
of a bank) upon the Federal Reserve’s determination
that such
activity or control constitutes a serious risk to the financial soundness or stability
of any subsidiary depository institution of the
financial holding company.
Further, federal bank regulatory authorities have
additional discretion to require a financial holding
company to divest itself of any bank or nonbank subsidiary if the agency
determines that divestiture may aid the depository
institution’s financial condition.
Safe and Sound Banking Practices
Bank holding companies and their nonbanking subsidiaries are prohibited
from engaging in activities that represent unsafe and
unsound banking practices or that constitute a violation of law or regulations.
Under certain conditions the Federal Reserve may
conclude that some actions of a bank holding company,
such as a payment of a cash dividend, would constitute an unsafe and
unsound banking practice. The Federal Reserve also has the authority
to regulate the debt of bank holding companies, including
the authority to impose interest rate ceilings and reserve requirements on
such debt. The Federal Reserve may also require a bank
holding company to file written notice and obtain its approval prior to purchasing
or redeeming its equity securities, unless certain
conditions are met.
14
Capital City Bank
Capital City Bank is a state-chartered commercial banking institution that is chartered
by and headquartered in the State of Florida
and is subject to supervision and regulation by the Florida OFR. The Florida OFR supervises and
regulates all areas of our
operations including, without limitation, the making of loans, the issuance of
securities, the conduct of our corporate affairs, the
satisfaction of capital adequacy requirements, the payment of dividends,
and the establishment or closing of banking centers. We
are also a member bank of the Federal Reserve System, which makes our operations
subject to broad federal regulation and
oversight by the Federal Reserve. In addition, our deposit accounts are insured
by the Federal Deposit Insurance Corporation (the
”FDIC”) up to the maximum extent permitted by law,
and the FDIC has certain supervisory enforcement powers over us.
As a Florida state-chartered bank, we are empowered by statute, subject to
the limitations contained in those statutes, to take and
pay interest on savings and time deposits, to accept demand deposits, to
make loans on residential and other real estate, to make
consumer and commercial loans, to invest (with certain limitations) in equity securities
and in debt obligations of banks and
corporations and to provide various other banking services for the benefit
of our clients. Various
consumer laws and regulations
also affect our operations, including state usury laws, laws relating to
fiduciaries, consumer credit and equal credit opportunity
laws, and fair credit reporting. In addition, the Federal Deposit Insurance Corporation
Improvement Act of 1991, or FDICIA,
prohibits insured state-chartered institutions from conducting activities as principal
that are not permitted for national banks. A
bank, however, may engage in certain otherwise
prohibited activity if it meets its minimum capital requirements and the FDIC
determines that the activity does not present a significant risk to the Deposit Insurance
Fund (“DIF”).
Safety and Soundness Standards / Risk Management
The federal banking agencies have adopted guidelines establishing
operational and managerial standards to promote the safety
and soundness of federally insured depository institutions. The guidelines
set forth standards for internal controls, information
systems, internal audit systems, loan documentation, credit underwriting,
interest rate exposure, asset growth, compensation, fees
and benefits, asset quality and earnings.
In general, the safety and soundness guidelines prescribe the goals to be achieved
in each area, and each institution is responsible
for establishing its own procedures to achieve those goals. If an institution
fails to comply with any of the standards set forth in
the guidelines, the financial institution’s
primary federal regulator may require the institution to submit a plan for
achieving and
maintaining compliance. If a financial institution fails to submit an acceptable
compliance plan or fails in any material respect to
implement a compliance plan that has been accepted by its primary federal
regulator, the regulator is required to issue an order
directing the institution to cure the deficiency.
Until the deficiency cited in the regulator’s order is cured, the regulator
may
restrict the financial institution’s
rate of growth, require the financial institution to increase its capital, restrict the
rates the
institution pays on deposits or require the institution to take any action
the regulator deems appropriate under the circumstances.
Noncompliance with the standards established by the safety and soundness
guidelines may also constitute grounds for other
enforcement action by the federal bank regulatory agencies, including
cease and desist orders and civil money penalty
assessments.
The bank regulatory agencies have increasingly emphasized the importance
of sound risk management processes and strong
internal controls when evaluating the activities of the financial institutions they
supervise. Properly managing risks has been
identified as critical to the conduct of safe and sound banking activities and has
become even more important as new
technologies, product innovation and the size and speed of financial transactions have
changed the nature of banking markets. The
agencies have identified a spectrum of risks facing a banking institution including,
but not limited to, credit, market, liquidity,
operational, legal and reputational risk. A particular area of focus for regulators
has been operational risk, which arises from the
potential that inadequate information systems, operational problems,
breaches in internal controls, fraud or unforeseen
catastrophes will result in unexpected losses. New products and services, third
party risk management and cybersecurity are
critical sources of operational risk that financial institutions are expected
to address in the current environment. The Bank is
expected to have active board and senior management oversight; adequate
policies, procedures and limits; adequate risk
measurement, monitoring and management information systems; and
comprehensive internal controls.
Reserves
The Federal Reserve requires all depository institutions to maintain
reserves against transaction accounts (noninterest bearing and
NOW checking accounts). The balances maintained to meet the reserve
requirements imposed by the Federal Reserve may be
used to satisfy liquidity requirements. An institution may borrow from
the Federal Reserve Bank “discount window” as a
secondary source of funds, provided that the institution meets the Federal
Reserve Bank’s credit standards.
15
Dividends
CCB is subject to legal limitations on the frequency and amount of dividends
that can be paid to CCBG. The Federal Reserve may
restrict the ability of CCB to pay dividends if such payments would constitute an
unsafe or unsound banking practice.
Additionally, financial
institutions are now required to maintain a capital conservation buffer
of at least 2.5% of risk-weighted
assets in order to avoid restrictions on capital distributions and other payments.
If a financial institution’s capital conservation
buffer falls below the minimum requirement, its maximum payout
amount for capital distributions and discretionary payments
declines to a set percentage of eligible retained income based on the size of the
buffer. See “Capital Regulations” below
for
additional details on this capital requirement.
In addition, Florida law and Federal regulation place restrictions on the declaration
of dividends from state-chartered banks to
their holding companies. Under the Florida Financial Institutions Code,
the board of directors of a state-chartered bank, after it
charges off bad debts, depreciation and other
worthless assets, if any, and makes provisions
for reasonably anticipated future
losses on loans and other assets, may quarterly,
semi-annually or annually declare a dividend of up to the aggregate net profits of
that period combined with the bank’s
retained net profits for the preceding two years. In addition, with the approval of the
Florida OFR and Federal Reserve, the bank’s
board of directors may declare a dividend from retained net profits which accrued
prior to the preceding two years. Before declaring such dividends, 20% of
the net profits for the preceding period as is covered by
the dividend must be transferred to the surplus fund of the bank until this fund becomes
equal to the amount of the bank’s
common stock then issued and outstanding. However,
a Florida state-chartered bank may not declare any dividend if (i) its net
income (loss) from the current year combined with the retained net income
(loss) for the preceding two years aggregates a loss or
(ii) the payment of such dividend would cause the capital account of the bank to fall below the
minimum amount required by law,
regulation, order or any written agreement with the
Florida OFR or a federal regulatory agency.
Under Federal Reserve
regulations, a state member bank may,
without the prior approval of the Federal Reserve, pay a dividend in an amount that, when
taken together with all dividends declared during the calendar year,
does not exceed the sum of the bank’s net income
during the
current calendar year and the retained net income of the prior two calendar years.
The Federal Reserve may approve greater
amounts.
Insurance of Accounts and Other Assessments
Deposits at U.S. domiciled banks are insured by the FDIC, subject to limits and
conditions of applicable laws and regulations.
Our deposit accounts are insured by the DIF generally up to a maximum of
$250,000 per separately insured depositor.
In order to
fund the DIF,
all insured depository institutions are required to pay quarterly assessments to
the FDIC that are based on an
institutions assignment to one of four risk categories based on supervisory
evaluations, regulatory capital levels and certain other
factors. The FDIC has the discretion to adjust an institution’s
risk rating and may terminate its insurance of deposits upon a
finding that the institution engaged or is engaging in unsafe and unsound practices,
is in an unsafe or unsound condition to
continue operations, or violated any applicable law,
regulation, rule, order or condition imposed by the FDIC or written
agreement entered into with the FDIC. The FDIC may also prohibit any FDIC-insured
institution from engaging in any activity it
determines to pose a serious risk to the DIF.
In October 2022, the FDIC finalized a rule to increase the initial base deposit insurance
assessment rate schedules uniformly by 2
basis points beginning with the first quarterly assessment period of 2023. The increased
assessment is intended to improve the
likelihood that the DIF reserve ratio would reach the statutory minimum of 1.35%
by the statutory deadline of September 30,
2028 prescribed under the FDIC’s amended
restoration plan. In November 2023, the FDIC adopted a final rule with respect to a
special assessment to recover the costs associated with protecting uninsured
depositors following the closures of Silicon Valley
Bank and Signature Bank. The final rule does not apply to any banking organization
with less than $5 billion in total consolidated
assets and therefore the special assessment did not directly impact the Company.
Transactions with Affiliates and
Insiders
Pursuant to Sections 23A and 23B of the Federal Reserve Act and Regulation
W,
the authority of CCB to engage in transactions
with related parties or “affiliates” or to make loans to insiders is limited.
Loan transactions with an affiliate generally must be
collateralized and certain transactions between CCB and its affiliates,
including the sale of assets, the payment of money or the
provision of services, must be on terms and conditions that are substantially the
same, or at least as favorable to CCB, as those
prevailing for comparable nonaffiliated transactions.
In addition, CCB generally may not purchase securities issued or
underwritten by affiliates.
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Loans to executive officers and directors of an insured depository
institution or any of its affiliates or to any person who directly
or indirectly, or
acting through or in concert with one or more persons, owns, controls or has the power
to vote more than 10% of
any class of voting securities of a bank, which we refer to as “10% Shareowners,”
or to any political or campaign committee the
funds or services of which will benefit those executive officers, directors,
or 10% Shareowners or which is controlled by those
executive officers, directors or 10% Shareowners, are
subject to Sections 22(g) and 22(h) of the Federal Reserve Act and the
corresponding regulations (Regulation O) and Section 13(k) of
the Exchange Act relating to the prohibition on personal loans to
executives (which exempts financial institutions in compliance with the
insider lending restrictions of Section 22(h) of the Federal
Reserve Act). Among other things, these loans must be made on terms substantially
the same as those prevailing on transactions
made to unaffiliated individuals and certain extensions
of credit to those persons must first be approved in advance by a
disinterested majority of the entire board of directors. Section 22(h) of the
Federal Reserve Act prohibits loans to any of those
individuals where the aggregate amount exceeds an amount equal
to 15% of an institution’s unimpaired
capital and surplus plus
an additional 10% of unimpaired capital and surplus in the case of loans
that are fully secured by readily marketable collateral, or
when the aggregate amount on all of the extensions of credit outstanding
to all of these persons would exceed our unimpaired
capital and unimpaired surplus. Section 22(g) identifies limited circumstances
in which we are permitted to extend credit to
executive officers.
Community Reinvestment Act
The CRA and its corresponding regulations are intended to encourage banks to
help meet the credit needs of the communities
they serve, including low- and moderate-income (“LMI”) neighborhoods,
consistent with safe and sound banking practices. These
regulations provide for regulatory assessment of a bank’s
record in meeting the credit needs of its market area. Federal banking
agencies are required to publicly disclose each bank’s
rating under the CRA. The Federal Reserve considers a bank’s
CRA rating
when the bank submits an application to establish bank branches, merge
with another bank, or acquire the assets and assume the
liabilities of another bank. In the case of a financial holding company,
the CRA performance record of all banks involved in a
merger or acquisition are reviewed in connection with
the application to acquire ownership or control of shares or assets of a bank
or to merge with another bank or bank holding company.
An unsatisfactory record can substantially delay or block the
transaction. We
received a satisfactory rating on our most recent CRA assessment.
In 2023, the Federal Reserve, along with the FDIC and OCC, issued a joint final
rule that made significant amendments to the
regulations implementing the CRA to “strengthen and modernize” those
regulations, including by creating rigorous data-driven
performance tests and growing the geographic areas in which a bank’s
CRA performance may be evaluated. The final rules were
intended to achieve the following key goals, among others:
●
strengthen the achievement of the core purpose of the CRA;
●
encourage banks to expand access to credit, investment, and banking services
in LMI communities;
●
adapt to changes in the banking industry,
including internet and mobile banking;
●
provide greater clarity and consistency in the application of the CRA regulations;
and
●
tailor CRA evaluations and data collection to bank size and type.
The compliance date for a majority of the rule’s
provisions is January 1, 2026. The remaining requirements, including
the data
reporting requirements, will be applicable on January 1, 2027. We
are planning for compliance with the final rules and continue to
evaluate the impact of the final rules to our financial condition, results of operations,
and liquidity, which cannot
be predicted at
this time.
Capital Regulations
The federal banking regulators have adopted rules implementing
risk-based, capital adequacy guidelines for financial holding
companies and their subsidiary banks based on the Basel III standards. Under
these guidelines, assets and off-balance sheet items
are assigned to specific risk categories each with designated risk weightings.
These risk-based capital guidelines were designed to
make regulatory capital requirements more sensitive to differences
in risk profiles among banks and bank holding companies, to
account for off-balance sheet exposure, to minimize disincentives
for holding liquid assets, and to achieve greater consistency in
evaluating the capital adequacy of major banks throughout the world.
The resulting capital ratios represent capital as a percentage
of total risk-weighted assets and off-balance sheet items.
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In computing total risk-weighted assets, bank and bank holding company
assets are given risk-weights of 0%, 20%, 50%, 100%
and 150%. In addition, certain off-balance sheet items are given
similar credit conversion factors to convert them to asset
equivalent amounts to which an appropriate risk-weight will apply.
Most loans will be assigned to the 100% risk category,
except
for performing first mortgage loans fully secured by 1-to-4 family and
certain multi-family residential property,
which carry a
50% risk rating. Most investment securities (including, primarily,
general obligation claims on states or other political
subdivisions of the United States) will be assigned to the 20% category,
except for municipal or state revenue bonds, which have
a 50% risk-weight, and direct obligations of the U.S. Treasury
or obligations backed by the full faith and credit of the U.S.
Government, which have a 0% risk-weight. In covering off
-balance sheet items, direct credit substitutes, including general
guarantees and standby letters of credit backing financial obligations,
are given a 100% conversion factor.
Transaction-related
contingencies such as bid bonds, standby letters of credit backing nonfinancial
obligations, and undrawn commitments (including
commercial credit lines with an initial maturity of more than one year)
have a 50% conversion factor. Short
-term commercial
letters of credit are converted at 20% and certain short-term unconditionally
cancelable commitments have a 0% factor.
The rules implement strict eligibility criteria for regulatory capital instruments
and improve the methodology for calculating risk-
weighted assets to enhance risk sensitivity.
Consistent with the international Basel III framework, the rules include
a minimum
ratio of Common Equity Tier 1 Capital to Risk-Weighted
Assets of 4.5%. The rules provide for a Common Equity Tier
1 Capital
conservation buffer of 2.5% of risk-weighted assets. This buffer
is added to each of the three risk-based capital ratios to determine
whether an institution has established the buffer.
The rules provide for a minimum ratio of Tier 1 Capital to
Risk-Weighted Assets
of 6% and include a minimum leverage ratio of 4% for all banking organizations.
If a financial institution’s capital conservation
buffer falls below 2.5% (e.g., if the institution’s
Common Equity Tier 1 Capital to Risk-Weighted
Assets is less than 7.0%), then
capital distributions and discretionary payments will be limited
or prohibited based on the size of the institution’s
buffer. The
types of payments subject to this limitation include dividends, share buybacks,
discretionary payments on Tier 1 instruments, and
discretionary bonus payments.
The capital regulations may also impact the treatment of accumulated
other comprehensive income (“AOCI”) for regulatory
capital purposes. AOCI generally flows through to regulatory capital;
however, community banks and their holding
companies
were allowed a one-time irrevocable opt-out election to continue
to treat AOCI the same as under the old regulations for
regulatory capital purposes. This election was required to be made on the
first call report or bank holding company annual report
(on form FR Y-9C)
filed after January 1, 2015.
We
made the opt-out election. Additionally,
the rules also permitted community
banks with less than $15 billion in total assets to continue to count certain
non-qualifying capital instruments issued prior to May
19, 2010, as Tier 1 capital, including trust preferred
securities and cumulative perpetual preferred stock (subject to a limit of 25%
of Tier 1 capital). However,
non-qualifying capital instruments issued on or after May 19, 2010, would
not qualify for Tier 1
capital treatment.
Commercial Real Estate Concentration Guidelines
The federal banking regulators have implemented guidelines to address
increased concentrations in commercial real estate loans.
These guidelines describe the criteria regulatory agencies will use as indicators
to identify institutions potentially exposed to
commercial real estate concentration risk. An institution that has (i) experienced
rapid growth in commercial real estate lending,
(ii) notable exposure to a specific type of
commercial real estate, (iii) total reported loans for construction, land development,
and
other land representing 100% or more of total risk-based capital, or (iv)
total commercial real estate (including construction) loans
representing 300% or more of total risk-based capital and the outstanding
balance of the institutions commercial real estate
portfolio has increased by 50% or more in the prior 36 months, may be identified
for further supervisory analysis of a potential
concentration risk.
At December 31, 2024, CCB’s ratio
of construction, land development and other land loans to total risk-based
capital was 78%,
its ratio of total commercial real estate loans to total risk-based capital was 212%
and, therefore, CCB was under the 100% and
300% thresholds, respectively,
set forth in clauses (iii) and (iv) above.
As a result, we are not deemed to have a concentration in
commercial real estate lending under applicable regulatory guidelines.
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Prompt Corrective Action
The federal banking agencies are required to take “prompt corrective
action” with respect to financial institutions that do not meet
minimum capital requirements. The law establishes five categories
for this purpose: “well-capitalized,” “adequately capitalized,”
“undercapitalized,” “significantly undercapitalized” and “critically undercapitalized.”
To be considered “well-capitalized,”
an
insured depository institution must maintain minimum capital ratios and
must not be subject to any order or written directive to
meet and maintain a specific capital level for any capital measure. An institution
that fails to remain well-capitalized becomes
subject to a series of restrictions that increase in severity as its capital condition weakens.
Such restrictions may include a
prohibition on capital distributions, restrictions on asset growth or
restrictions on the ability to receive regulatory approval of
applications. The regulations apply only to banks and not to BHCs. However,
the Federal Reserve is authorized to take
appropriate action at the holding company level based on the undercapitalized
status of the holding company’s
subsidiary banking
institutions. In certain instances relating to an undercapitalized banking
institution, the BHC would be required to guarantee the
performance of the undercapitalized subsidiary’s
capital restoration plan and could be liable for civil money damages for failure
to fulfill those guarantee commitments.
In addition, failure to meet capital requirements may cause an institution
to be directed to raise additional capital. Federal law
further mandates that the agencies adopt safety and soundness standards generally
relating to operations and management, asset
quality and executive compensation, and authorizes administrative action
against an institution that fails to meet such standards.
Failure to meet capital guidelines may subject a banking organization
to a variety of other enforcement remedies, including
additional substantial restrictions on its operations and activities, termination
of deposit insurance by the FDIC and, under certain
conditions, the appointment of a conservator or receiver.
At December 31, 2024, we exceeded the requirements contained in the
applicable regulations, policies and directives pertaining to
capital adequacy to be classified as “well capitalized” and are unaware
of any material violation or alleged violation of these
regulations, policies or directives (see table below). Rapid growth, poor
loan portfolio performance, or poor earnings
performance, or a combination of these factors, could change our
capital position in a relatively short period of time, making
additional capital infusions necessary.
Our capital ratios can be found in Note 17 to the Notes to our Consolidated
Financial
Statements.
Interstate Banking and Branching
The Dodd-Frank Act relaxed interstate branching restrictions by modifying
the federal statute governing de novo interstate
branching by state member banks. Consequently,
a state member bank may open its initial branch in a state outside of the bank’s
home state by way of an interstate bank branch, so long as a bank chartered under
the laws of that state would be permitted to
open a branch at that location.
Anti-money Laundering
The Uniting and Strengthening America by Providing Appropriate Tools
Required to Intercept and Obstruct Terrorism
Act of
2001 (the “USA Patriot Act”), provides the federal government with additional
powers to address terrorist threats through
enhanced domestic security measures, expanded surveillance powers,
increased information sharing and broadened anti-money
laundering requirements. By way of amendments to the Bank Secrecy
Act (the “BSA”), the USA Patriot Act puts in place
measures intended to encourage information sharing among bank regulatory
and law enforcement agencies. In addition, certain
provisions of the USA Patriot Act impose affirmative obligations
on a broad range of financial institutions.
The USA Patriot Act, BSA, and the related federal regulations require
banks to establish anti-money laundering programs that
include policies, procedures and controls to detect, prevent and report
money laundering and terrorist financing and to verify the
identity of their customers and of beneficial owners of their legal entity customers.
The Anti-Money Laundering Act (“AMLA”), which amends the BSA, was enacted
in early 2021. The AMLA is intended to be a
comprehensive reform and modernization of U.S. bank secrecy and
anti-money laundering laws. In particular, it codifies a risk-
based approach to anti-money laundering compliance for financial
institutions, requires the U.S. Department of the Treasury
to
promulgate priorities for anti-money laundering and countering the
financing of terrorism policy,
requires the development of
standards for testing technology and internal processes for BSA compliance,
expands enforcement-
and investigation-related
authority (including increasing available sanctions for certain BSA violations),
and expands BSA whistleblower incentives and
protections.
Many AMLA provisions require additional rulemakings, reports,
and other measures, and the impact of the AMLA will depend
on, among other things, rulemaking and implementation
guidance. In June 2021, the Financial Crimes Enforcement Network, a
bureau of the U.S. Department of the Treasury,
issued the priorities for anti-money laundering and countering the financing of
terrorism policy required under the AMLA. The priorities include corruption,
cybercrime, terrorist financing, fraud, transnational
crime, drug trafficking, human trafficking
and proliferation financing.
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There is also increased scrutiny of compliance with the sanctions programs
and rules administered and enforced by the Office of
Foreign Assets Control of the U.S. Department of Treasury,
or “OFAC.” OFAC
administers and enforces economic and trade
sanctions against targeted foreign countries and regimes,
terrorists, international narcotics traffickers, those engaged
in activities
related to the proliferation of weapons of mass destruction, and other threats
to the national security, foreign
policy or economy of
the United States, based on U.S. foreign policy and national security
goals. OFAC issues regulations
that restrict transactions by
U.S. persons or entities (including banks), located in the U.S. or abroad,
with certain foreign countries, their nationals or
“specially designated nationals.” OFAC
regularly publishes listings of foreign countries and designated
nationals that are
prohibited from conducting business with any U.S. entity or individual.
While OFAC is responsible
for promulgating, developing
and administering these controls and sanctions, all of the bank regulatory
agencies are responsible for ensuring that financial
institutions comply with these regulations.
Privacy
A variety of federal and state privacy laws govern the collection, safeguarding,
sharing and use of customer information, and
require that financial institutions have policies regarding information
privacy and security. The GLBA
and related regulations
require banks and their affiliated companies to adopt and
disclose privacy policies, including policies regarding the sharing of
personal information with third parties. Some state laws also protect the privacy
of information of state residents and require
adequate security of such data, and certain state laws may require us
to notify affected individuals of security breaches of
computer databases that contain their personal information. These
laws may also require us to notify law enforcement, regulators
or consumer reporting agencies in the event of a data breach, as well as businesses
and governmental agencies that own data.
Cybersecurity
The federal banking regulators regularly issue new guidance and standards,
and update existing guidance and standards, regarding
cybersecurity intended to enhance cyber risk management among financial
institutions. Financial institutions are expected to
comply with such guidance and standards and to accordingly develop appropriate
security controls and risk management
processes. If we fail to observe such regulatory guidance or standards, we
could be subject to various regulatory sanctions,
including financial penalties. In 2023, the SEC issued a final rule that requires
disclosure of material cybersecurity incidents, as
well as cybersecurity risk management, strategy and governance. Under
this rule, banking organizations that are SEC registrants
must generally disclose information about a material cybersecurity incident
within four business days of determining it is material
with periodic updates as to the status of the incident in subsequent filings,
as necessary.
Banking organizations are also required to notify their primary
banking regulator within 36 hours of determining that a
“computer-security incident” has materially disrupted or degraded,
or is reasonably likely to materially disrupt or degrade, the
banking organization’s
ability to carry out banking operations or deliver banking products and services
to a material portion of its
customer base, its businesses and operations that would result in material loss, or its operations
that would impact the stability of
the United States.
State regulators have also been increasingly active in implementing privacy
and cybersecurity standards and regulations.
Recently, several states have
adopted regulations requiring certain financial institutions to implement
cybersecurity programs and
many states have also recently implemented or modified their data breach
notification, information security and data privacy
requirements. We
expect this trend of state-level activity in those areas to continue and are continually
monitoring developments
in the states in which our customers are located.
Risks and exposures related to cybersecurity attacks, including litigation
and enforcement risks, are expected to be elevated for
the foreseeable future due to the rapidly evolving nature and sophistication of
these threats, as well as due to the expanding use of
internet banking, mobile banking, and other technology-based products
and services by us and our customers.
See Item 1A. Risk Factors for a further discussion of risks related to cybersecurity
and Item 1C. Cybersecurity for a further
discussion of risk management strategies and governance processes related to
cybersecurity.
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Consumer Laws and Regulations
CCB is also subject to other federal and state consumer laws and regulations that
are designed to protect consumers in
transactions with banks. These laws and regulations, among other things, mandate
certain disclosures and regulate the manner in
which financial institutions must deal with clients when taking deposits or making
loans to clients, provide substantive consumer
rights, prohibit discrimination in credit transactions, regulate the use of
credit report information, provide financial privacy
protections, prohibit unfair, deceptive and
abusive practices, restrict our ability to raise interest rates, and subject us to
substantial
regulatory oversight. CCB must comply with these consumer protection
laws and regulations as part of its ongoing client
relations. Violations of
applicable consumer protection laws can result in significant potential liability from
litigation brought by
customers, including actual damages, restitution and attorneys’ fees. Federal
bank regulators, state attorneys general and state and
local consumer protection agencies may also seek to enforce consumer protection
requirements and obtain these and other
remedies, including regulatory sanctions, customer rescission rights,
action by the state and local attorneys general in each
jurisdiction in which we operate and civil money penalties. Failure to
comply with consumer protection requirements may also
result in our failure to obtain any required bank regulatory approval
for merger or acquisition transactions we may wish to pursue
or our prohibition from engaging in such transactions even if approval is not required.
In addition, the Consumer Financial Protection Bureau (“CFPB”) issues regulations
and standards under these federal consumer
protection laws that affect our consumer businesses. Although
the CFPB has jurisdiction over banks with $10 billion or greater in
assets, the regulations and standards issued by the CFPB may also impact
CCB or its subsidiaries by virtue of the adoption of the
same or similar regulations and standards by the Federal Reserve or FDIC.
These include regulations setting “ability to repay”
standards for residential mortgage loans and mortgage loan servicing
and originator compensation standards, which generally
require creditors to make a reasonable, good faith determination of
a consumer’s ability to repay any consumer credit transaction
secured by a dwelling (excluding an open-end credit plan, timeshare
plan, reverse mortgage, or temporary loan) and establishes
certain protections from liability under this requirement for loans that meet the
requirements of the “qualified mortgage” safe
harbor. Also, the TILA-RESPA
Integrated Disclosure, or TRID, rules for mortgage closings have impacted
our loan applications.
These rules, including the required loan forms, generally increased the time it takes to
approve mortgage loans.
In 2022, certain members of Congress and the leadership of the CFPB expressed a heightened
interest in bank consumer overdraft
protection programs. In 2022, the CFPB piloted a supervision effort
to collect key metrics from some supervised institutions
regarding the consumer impact of their overdraft and non-sufficient
fund practices, with the intent of using this information to
identify institutions for further examination and review.
The CFPB indicated, at the time, that it intended to pursue enforcement
actions against banking organizations, and their executives,
that oversee overdraft practices that were deemed to be unlawful, and
indeed took action against a large bank for charging “surprise”
overdraft fees known as authorized positive fees. In October
of
2022, the CFPB issued guidance to help banks avoid charging
illegal surprise overdraft fees. In addition, the Comptroller of the
Currency has identified potential options for reform of national bank overdraft protection
practices, including providing a grace
period before the imposition of a fee, refraining from charging multiple
fees in a single day and eliminating fees altogether.
In December 2024, the CFPB issued a final rule that, among other things, will require
financial institutions with more than $10
billion in assets to offer overdraft protection services to
either provide customers that receive such services with loan disclosures
required under the TILA and Regulation Z, or cap any charges associated with the
provision of such services at $5 or an amount
that would allow the institution to cover its costs and losses with respect to the overdraft
credit transaction. The CFPB’s final
rule
on overdraft credit is currently scheduled to take effect on October
1, 2025. However, the rule is subject to legal challenges
and
continued implementation of the final rule under the new leadership
of the CFPB is uncertain. While this new rule would not
impose direct obligations on CCB, it would directly impact some of CCB’s
competitors and therefore may influence CCB’s
policies and practices relating to overdraft protection services.
See Item 1A. Risk Factors under the section captioned “Fee revenues from overdraft
protection programs constitute a significant
portion of our noninterest income and may continue to be subject to increased
supervisory scrutiny” for further discussion related
to the impacts of increased scrutiny of overdraft fees on us.
Future Legislative Developments
Various
bills are from time to time introduced in the U.S. Congress and the Florida legislature.
This legislation may change
banking and tax statutes and the environment in which our banking subsidiary
and we operate in substantial and unpredictable
ways. We cannot
determine the ultimate effect that potential legislation, if enacted, or
implementing regulations with respect
thereto, would have upon our financial condition or results of operations or
that of our banking subsidiary.
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Effect of Governmental Monetary Policies
The commercial banking business is affected not only by general
economic conditions, but also by the monetary policies of the
Federal Reserve. Changes in the discount rate on member bank borrowing,
availability of borrowing at the “discount window,”
open market operations, changes in the Fed Funds target
interest rate, changes in interest rates payable on reserve accounts, the
imposition of changes in reserve requirements against member banks’ deposits
and assets of foreign banking centers and the
imposition of and changes in reserve requirements against certain borrowings
by banks and their affiliates are some of the
instruments of monetary policy available to the Federal Reserve. These monetary
policies are used in varying combinations to
influence overall growth and distributions of bank loans, investments and deposits,
which may affect interest rates charged on
loans or paid on deposits. The monetary policies of the Federal Reserve have
had a significant effect on the operating results of
commercial banks and are expected to continue to do so in the future. The
Federal Reserve’s policies are primarily
influenced by
its dual mandate of price stability and full employment, and, to a lesser degree by
short-term and long-term changes in the
international trade balance and in the fiscal policies of the U.S. Government. Future
changes in monetary policy and the effect of
such changes on our business and earnings in the future cannot be predicted.
Website Access to Company’s
Reports
Our Internet website is www.ccbg.com.
Our annual reports on Form 10-K, quarterly reports on Form 10-Q,
current reports on
Form 8-K, including any amendments to those reports filed or furnished pursuant
to section 13(a) or 15(d), and reports filed
pursuant to Section 16, 13(d), and 13(g) of the Exchange Act are available
free of charge through our website as soon as
reasonably practicable after they are electronically filed with, or furnished
to, the SEC.
The information on our website is not
incorporated by reference into this report.
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