Southwest Georgia Financial Corporation Reports 21% Earnings Growth for Third Quarter 2018

Southwest Georgia Financial Corporation (the "Company”) (NYSE American:SGB), a full-service community bank holding company, today reported results of operations for the third quarter and nine months ended September 30, 2018. Comparisons are to prior-year period unless otherwise noted.

"We continue to experience solid results. Loan growth exceeded 11%, or nearly $37 million, and deposits were also up 11% year-over-year,” commented DeWitt Drew, President and CEO. "In mid-October, Hurricane Michael impacted a portion of our operating area and, as a result of both continued loan growth and weather events, we anticipate higher provisions for loan losses for the remainder of the year.”

Third Quarter and Nine-Month Income Highlights

• Net income increased to $1.14 million, or $0.45 per diluted share, from $952 thousand, or $0.37 per diluted share. Net interest income improved 9% to $4.8 million, primarily due to growth in average total loans of $32.8 million. An increase in provision for loan losses of $174 thousand and increases in non-interest expenses partially offset growth in net interest income.
• For the nine months ended September 30, 2018, net income was up over 14% to $3.5 million, or $1.38 per diluted share, due mostly to increases in net interest income of almost 8% and lower effective tax rates. Partially offsetting were higher provisions for loan losses, increased overhead expenses of $339 thousand, and lower noninterest income of $321 thousand.

Balance Sheet Trends

• Total assets at September 30, 2018, were $515.4 million, up 8%, or $38.2 million. Total loans grew 11%, or $36.8 million, to $366.7 million, and were funded by an 11% growth in total deposits. Higher levels of liquidity are being held due to the Company’s strong loan pipeline as well as concerns about higher interest rates causing disintermediation.
• Total deposits were up $41.5 million to $426 million at September 30, 2018, with a noticeable shift from noninterest-bearing deposits to the new interest bearing business checking account offering.
• Federal Home Loan Bank Advances were down $4.1 million. The average cost of all interest bearing liabilities increased 31 basis points to 0.95%. The average cost of interest bearing deposits increased 36 basis points to 0.80%.

Capital Management

• Book value per share grew 4% to $16.67 at September 30, 2018.
• In September 2018, the Company paid a quarterly cash dividend of $0.12 per common share. Southwest Georgia Financial Corporation or its predecessor, Southwest Georgia Bank, has paid cash dividends for
  90 consecutive years.

Webcast and Conference Call

The Company will host a conference call and webcast on Tuesday, October 30, 2018 at 1:00 p.m. ET. Management will review the financial and operating results for the third quarter 2018, as well as the Company’s strategy and outlook. A question and answer session will follow the formal discussion.

The conference call can be accessed by calling (201) 689-8263. Alternatively, the webcast can be monitored at www.sgb.bank.

A telephonic replay will be available from 4:00 p.m. ET on the day of the teleconference until Tuesday, November 13, 2018. To listen to the archived call, dial (412) 317-6671 and enter conference ID number 13683724, or access the webcast replay at www.sgb.bank/investor-relations, where a transcript will be posted once available.

About Southwest Georgia Financial Corporation

Southwest Georgia Financial Corporation is a state-chartered bank holding company with approximately $515 million in assets headquartered in Moultrie, Georgia. Its primary subsidiary, Southwest Georgia Bank, offers comprehensive financial services to consumer, business, and government customers. The current banking facilities include the main office located in Colquitt County, and branch offices located in Baker County, Worth County, Lowndes County and Tift County. In addition to conventional banking services, the Company provides investment planning and management, trust management, and commercial and individual insurance products. Insurance products and advice are provided by Southwest Georgia Insurance Services, which is located in Colquitt County. The Company routinely posts news and other important information on its website. More information on Southwest Georgia Financial Corporation and Southwest Georgia Bank can be found at: www.sgb.bank.

SAFE HARBOR STATEMENT

This news release contains forward-looking statements, as defined by federal securities laws, including statements about the Company’s financial outlook. These statements are based on current expectations and are provided to assist in the understanding of future financial performance. Such performance involves risks and uncertainties that may cause actual results to differ materially from those expressed or implied in any such statements. Important factors that could cause actual results to differ materially from those contemplated today include a change in the Company’s capital structure, new or expanded regulatory requirements, the success of the Company’s growth strategy, customer preferences, the interest rate environment and other factors described in the Company’s filings with the Securities and Exchange Commission, including its Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q under the sections entitled "Forward-Looking Statements” and "Risk Factors”. The Company undertakes no obligation to update any forward-looking statements as a result of new information, future events or otherwise, except as otherwise required by law.

Financial tables follow.

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