Georgia Banking Company — Third Quarter 2026 Earnings Summary

Financial Performance:

• Reported net income of $6.3 million ($0.57 diluted EPS) for Q3 2026, compared to $5.6 million ($0.60 diluted EPS) in Q2 2026.
• Pre-tax, pre-provision earnings were $10.5 million, a 20.4% increase from Q2 2026; pre-tax, pre-provision operating earnings were $12.9 million, a 6.2% increase.
• Net interest income increased $2.3 million (8.0%) sequentially to $31.4 million.
• Net interest margin decreased to 4.17% from 4.31% in the prior quarter, primarily due to higher interest expense on subordinated debt refinancing.
• Average loans increased $158.3 million (6.7%) to $2.5 billion; average interest-bearing deposits increased $268.5 million (15.7%) to $2.0 billion.
• Noninterest expense was $23.8 million, a 0.4% increase from the prior quarter; excluding direct listing and M&A expenses, salaries and benefits increased $717 thousand.
• Provision for credit losses was $2.0 million, compared to $1.1 million in Q2 2026 and $734 thousand in Q3 2025.
• Net charge-offs were $893 thousand (0.16% of average loans annualized); nonperforming loan ratio was 0.99% at quarter-end.
• Allowance for credit losses (ACL) was $30.1 million (1.36% of total loans held for investment), an increase of $1.1 million from the prior quarter.
• Total assets were $3.14 billion; total deposits were $2.70 billion.
• Return on average assets was 0.80%; return on average equity was 8.72%.
• Operating efficiency ratio was 69.40%; operating efficiency ratio (excluding one-time expenses) was 62.25%.

Guidance and Future Outlook:

• Management stated priorities include delivering exceptional service, generating sustainable and profitable growth, and creating long-term shareholder value.
• The company noted continued attractive opportunities across its markets while maintaining a disciplined approach to credit, liquidity, and capital.
• No specific forward-looking numerical guidance for future revenue or earnings was provided in the release.

Business Segments and Product Lines:

• Loan growth was primarily driven by increases in commercial real estate and single-family residential loans.
• Commercial real estate loans held for investment were $943.6 million (42.4% of total LHI); single-family residential loans were $398.0 million (17.9%).
• Construction and land development loans were $295.6 million (13.3% of total LHI).
• Noninterest-bearing deposits represented 26.0% of total deposits.
• Average cost of total deposits increased 2 basis points sequentially to 0.58%.

Market and Competitive Landscape:

• The company is a community-focused financial institution headquartered in Atlanta, Georgia.
• The merger with Tandem Bancorp, Inc. closed on June 1, 2026, and was fully integrated on September 21, 2026.
• Shares are preparing to begin trading on the Nasdaq Capital Market.
• Named a Top Workplace by Axios for the fourth consecutive year based on employee feedback.

Risks and Challenges:

• Risks include changes in interest rates, yield curve shape, and monetary policy affecting net interest margin and deposit costs.
• Potential deterioration in credit quality, particularly in commercial real estate, construction, and land development portfolios.
• Concentration risk in commercial real estate lending and economic conditions in the Atlanta metropolitan area and Georgia.
• Challenges related to integrating Tandem Bancorp and realizing merger benefits, including integration costs and difficulties.
• Risks associated with subordinated debt restructuring and access to capital on acceptable terms.
• Risks related to the direct listing process, potential stock price volatility, and increased costs of operating as a public company.
• Cybersecurity incidents, fraud, and operational system failures.

Management Commentary and Tone:

• Bartow Morgan, Jr., CEO, stated results reflect the strength of the core banking franchise, execution of the growth strategy, and investments in people and capabilities.
• Management emphasized a disciplined approach to credit, liquidity, and capital.
• The tone was confident regarding the integration of Tandem and the company's positioning for public trading.

Other Key Points:

• The company incurred $2.0 million in direct listing expenses and $493 thousand in merger and acquisition expenses in Q3 2026, both before taxes.
• The merger with Tandem Bancorp, Inc. significantly impacted sequential and year-over-year comparisons.
• Preliminary Common Equity Tier 1 (CET1) ratio was 10.59% at September 30, 2026, compared to 10.29% at June 30, 2026, and 8.53% at September 30, 2025.
• Tangible book value per common share was $25.08 as of September 30, 2026.
• The company recorded a provision for credit losses of $2.0 million, primarily due to increases in general reserves driven by changes in economic factors and portfolio mix.