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About Us / Shareholder Information

 

Shareholder Information

 

ATTENTION SHAREHOLDERS:

 

There will be an annual shareholders’ meeting on Wednesday, May 26, 2010 at 10:30 at the Loudermilk Conference Center, 40 Courtland Street, NE Atlanta, Georgia.
Click here for more details.

Message to Our Stockholders

 

Greetings; and thank you for your continued support of Citizens Bancshares Corporation and its wholly-owned subsidiary, Citizens Trust Bank. 
We have closed the books on our fiscal year ended December 31, 2009 and we are pleased to report to you another year of profitability and continued strength. As was expected, fiscal 2009 proved to be a very tough year for almost every enterprise and for the banking sector in particular. While many economists now claim that economic recovery has begun in earnest, it is clear that most sectors are still reeling from the worst U.S. recession in 70 years and the longest in post World War II history.

Indeed, since our report to you regarding our performance in fiscal 2008, almost forty banks in Georgia have been closed by regulators and 63% of the remaining banks reported no earnings at all in 2009.

It is our pleasure, therefore, to advise you that the net income for the Corporation for 2009 amounted to $1,027,000.  This earnings performance is about the same as the $1,023,000 earned in 2008. However, considering the one-time expenses incurred as a result of an in-market branch acquisition, increased FDIC premiums and one-time FDIC special assessment, and the overall economic environment and its particular impact on the banking industry, we are proud of our 2009 earnings achievement and think you should be as well. We, like you, have witnessed the far reaching impact of the real estate debacle on the economy and financial markets. The negative impact intensified as 2009 progressed and created a significant challenge to those in the banking arena and Citizens Trust Bank was not spared. 
During 2009, as a reflection of weakening loan quality, we charged $2,960,000 against our earnings to fully fund our reserve for loan losses. This amount was $471,000 more than the $2,489,000 charged to earnings during 2008. At December 31, 2009, our reserve for possible loan losses was deemed to be sufficient by our regulators and outside accountants. While we are beginning to see some stabilization in problem loans, please be assured that it is our intent to ensure that our loss reserve remains sufficient to weather any future problems, should they arise.

Weaknesses at other banks afforded opportunities for your company. On March 27, 2009 Citizens Trust Bank acquired the Lithonia Branch of The Peoples Bank. We acquired the in-market deposits of the branch which amounted to $50 million and access to more than 2,000 new customers. While there has been some deposit run-off from the acquisition, thanks to effective retention measures and the continued confidence of the marketplace in us, we saw our deposits increase by some $44 million, or 15.6% higher than that reported at year-end 2008. This deposit growth afforded us greater liquidity and the ability to further expand our market footprint in DeKalb County. In addition, our total assets stood at $387,539,513 at December 31, 2009, a growth rate of 11.33% when compared to our total assets of $348,095,426 at December 31, 2008.

As expected, resulting from the very poor economic environment, we saw our net loan portfolio decline from $210.3 million at year-end 2008 to $200.2 million at year-end 2009. The economic toll of the recession on consumers and businesses alike made it much more difficult to find new quality lending opportunities. However, we were able to minimize the impact by purchasing performing loans from other banks that had a dire need for capital and liquidity. During 2009, we purchased $12 million of such loans and I am happy to report that all are continuing to perform well.

We are also pleased to report that on March 6, 2009, as part of the U.S. Department of Treasury’s Troubled Asset Relief Program (“TARP”), we agreed to sell and Treasury agreed to purchase 7,462 shares of the Company’s preferred stock in the aggregate amount of $7,462,000.

Already regarded as a “well-capitalized” financial institution before this transaction, the new capital allows us to not only deal with problems as the economy recovers, but will also allow us to seize future growth opportunities, such as the aforementioned “Peoples” transaction. We have been prudent in our use of capital. Today, the measures centered on by regulators when assessing the viability of banks are the bank’s capital ratios. The chart below reflects just how Citizens Trust Bank’s capital ratios compare to regulatory requirements:

 

 

 It would be understandable for the casual observer to wonder why a bank like Citizens Trust Bank has been able to continue to operate in a safe, sound and profitable manner when so many other banks have encountered insurmountable difficulty in doing the same. Let me state it simply: It’s our people. Our officers and staff are seasoned banking veterans who have been with us for a number of years. They received no raises or cash bonuses in 2009 despite having navigated safely in a terrible economic storm and they have remained committed to excellence in all that we do.

Your board of directors has been dedicated to constructive oversight of management and has worked hard to fully and successfully understand the operations of your company, all the while challenging us all to be better in every aspect of our efforts. We are as proud as ever to be associated with this wonderful group of people.

Finally, we thank you again, our stakeholders, for your continued support and confidence. While we, like most banks, will continue to face challenges in this uncertain economic environment, we remain confident in our ability to perform among the best, compete effectively, remain community minded and continue to enhance shareholder value.

 

James E. Young President & CEO

Ray M. Robinson Chairman of the Board