Guaranty Bancorp Announces 2013 Annual and Fourth Quarter

DENVER, CO--(Marketwired - Jan 22, 2014) - Guaranty Bancorp (NASDAQ: GBNK)

Net income increased 31.0% in the fourth quarter 2013 as compared to the same quarter in 2012
Net loan growth of $161.7 million, or 14.0% during 2013
Core deposit growth of $85.0 million, or 6.7% during 2013
Net interest margin improvement to 3.65% during the fourth quarter 2013
Improvement in the efficiency ratio to 66.8% in 2013 as compared to 77.1% in 2012

Guaranty Bancorp (NASDAQ: GBNK) ("we", "our" or "the Company"), a community bank holding company based in Colorado, today announced fourth quarter 2013 net income of $4.1 million, or $0.20 earnings per basic common share and $0.19 earnings per diluted common share. Net income for the same quarter in 2012 was $3.1 million, or $0.15 earnings per basic and diluted common share ⁽¹⁾. The Company's pre-tax operating earnings ⁽²⁾ in the fourth quarter 2013 were $5.2 million, or $0.25 earnings per basic and diluted common share, an improvement of $1.8 million or $0.08 earnings per basic and diluted common share as compared to the same quarter in 2012.

The $1.8 million increase in pre-tax operating earnings in the fourth quarter 2013 as compared to the same quarter in the prior year was primarily due to a $0.7 million improvement in interest income, attributable to favorable growth in average loan and average investment balances, combined with a $0.5 million decrease in interest expense mostly due to a decline in average other interest-bearing liabilities. Additionally, several categories of noninterest income contributed to the increase in pre-tax operating earnings in the fourth quarter 2013 as compared to the fourth quarter 2012 including a $0.3 million increase in investment management and trust fees, a $0.2 million increase in bank-owned life insurance income ("BOLI") and a $0.2 million increase in deposit service fee income.

"For Guaranty Bancorp, 2013 was a year of growth," said Paul W. Taylor, President and CEO. "Strong net loan growth of 14.0% in 2013 led to sustained increases in net income throughout the year, and the growth we experienced in our Wealth Management group, coupled with gains on the sale of SBA loans, resulted in continued improvement in core noninterest income. We are pleased with the stability of our net interest margin in 2013, and we saw further core deposit growth during the year of $85.0 million or 6.7%. We made significant improvement in our efficiency ratio to 66.8% for 2013 compared to 77.1% in 2012 due to top line income growth and expense control efforts. Our solid performance for the year demonstrates the value businesses and consumers place in a locally based, community bank partner."

For the year ended December 31, 2013, pre-tax operating earnings improved $5.7 million, or 39.2% to $20.2 million as compared to $14.5 million for the same period in the prior year mostly due to a $3.2 million increase in net interest income, a $1.2 million increase in investment management and trust income, a $0.8 million increase in customer service fee income and a $0.5 million increase in gain on sale of Small Business Administration ("SBA") loans. The improvement in net interest income for the year ended December 31, 2013 as compared to the year ended December 31, 2012 was the result of a $1.1 million increase in interest income mostly due to growth in average loan and average investment balances of $127.4 million and $80.3 million, respectively, combined with a $2.1 million decline in interest expense primarily due to a decline in average other interest-bearing liabilities as well as a reduction in the average cost of deposits.

For the year ended December 31, 2013, net income was $14.0 million, or $0.67 earnings per basic and diluted common share compared to net income of $15.1 million, or $0.72 earnings per basic and diluted common share for the same period in 2012. Net income for the year ended December 31, 2012 included a $5.7 million reversal of our remaining deferred tax valuation allowance; a $2.0 million credit provision for loan losses; a $2.5 million gain on sales of securities, partially offset by a $2.8 million impairment on bank facilities. The Company began accruing income tax expense at an effective rate of 31.5% in the third quarter 2012, after the reversal of the remaining deferred tax valuation allowance in the second quarter 2012. The Company's effective income tax rate for the year ended December 31, 2013 was 31.2%.

⁽¹⁾ Share and per share amounts presented throughout this release, including earnings per share, tangible book value per share and book value per share have been adjusted to reflect the Company's 1-for-5 reverse stock split on May 20, 2013.

⁽²⁾ " Pre-tax operating earnings" is considered a "non-GAAP" financial measure, which we define as income before income taxes adjusted for (if any) provision (credit) for loan losses, other real estate owned expenses, debt termination expenses, acquisition, reorganization and integration costs, and securities gains and losses. More information regarding this measure and a reconciliation to the comparable GAAP measurement is provided under the heading Non-GAAP Financial Measures in this release.

Key Financial Measures
Income Statement


	Quarter Ended									Year Ended
	December				September		December			December			December
	31, 2013				30, 2013		31, 2012			31, 2013			31, 2012
	(Dollars in thousands, except per share amounts)
Net income	$	4,088		$	3,851		$	3,120		$	14,029		$	15,059
Earnings per common share - basic ⁽¹⁾	$	0.20		$	0.18		$	0.15		$	0.67		$	0.72
Return on average assets		0.85	%		0.81	%		0.67	%		0.75	%		0.86	%
Net interest margin		3.65	%		3.63	%		3.48	%		3.62	%		3.67	%
Efficiency ratio (tax equivalent)		63.49	%		65.12	%		88.16	%		66.79	%		77.05	%

⁽¹⁾ Share and per share amounts have been adjusted to reflect the Company's 1-for-5 reverse stock split on May 20, 2013.

Balance Sheet


	December			September			Percent		December			Percent
	31, 2013			30, 2013			Change		31, 2012			Change
	(Dollars in thousands, except per share amounts)
Cash and cash equivalents	$	28,077		$	33,465		(16.1)	%	$	163,217		(82.8)	%
Total investments		442,300			471,257		(6.1)	%		458,927		(3.6)	%
Total loans, net of unearned loan fees		1,320,424			1,293,252		2.1	%		1,158,749		14.0	%
Allowance for loan losses		(21,005	)		(20,450	)	2.7	%		(25,142	)	(16.5)	%
Total assets		1,911,032			1,896,191		0.8	%		1,886,938		1.3	%
Average earning assets, quarter-to-date		1,781,509			1,753,746		1.6	%		1,740,273		2.4	%
Average assets, quarter-to-date		1,905,524			1,878,081		1.5	%		1,843,212		3.4	%
Total deposits		1,528,457			1,482,515		3.1	%		1,454,756		5.1	%
Book value per common share ⁽¹⁾		8.89			8.80		1.0	%		8.89		-	%
Tangible book value per common share ⁽¹⁾		8.58			8.46		1.4	%		8.45		1.5	%
Equity ratio - GAAP		9.91	%		9.93	%	(0.2)	%		9.97	%	(0.6)	%
Tangible common equity ratio		9.60	%		9.58	%	0.2	%		9.53	%	0.7	%
Total risk-based capital ratio		14.96	%		14.94	%	0.1	%		16.27	%	(8.1)	%

⁽¹⁾ Share and per share amounts have been adjusted to reflect the Company's 1-for-5 reverse stock split on May 20, 2013.

Net Interest Income and Margin


	Quarter Ended									Year Ended
	December			September			December			December			December
	31, 2013			30, 2013			31, 2012			31, 2013			31, 2012
	(Dollars in thousands)
Net interest income	$	16,391		$	16,062		$	15,217		$	63,570		$	60,411
Interest rate spread		3.45	%		3.43	%		3.21	%		3.40	%		3.37	%
Net interest margin		3.65	%		3.63	%		3.48	%		3.62	%		3.67	%
Net interest margin, fully tax equivalent		3.75	%		3.73	%		3.57	%		3.72	%		3.77	%
Average cost of deposits (including noninterest-bearing deposits)		0.16	%		0.17	%		0.19	%		0.17	%		0.21	%

Fourth quarter 2013 net interest margin improved by two basis points to 3.65% compared to the third quarter 2013 and improved by 17 basis points from 3.48% in the fourth quarter 2012. The improvement in net interest margin in the fourth quarter 2013 as compared to the third quarter 2013 was primarily the result of a decline in the average cost of interest-bearing deposits. The improvement in net interest margin in the fourth quarter 2013 compared to the fourth quarter 2012 was mostly due to a 20 basis point increase in the yield on investments as well as a 19 basis point decrease in the average cost of interest-bearing liabilities. The decrease in the average cost of interest-bearing liabilities was primarily the result of the first quarter 2013 redemption of fixed, high-cost trust preferred securities ("TruPS") and related subordinated debentures combined with a lower average cost of deposits.

Net interest income improved $0.3 million to $16.4 million in the fourth quarter 2013 compared to the third quarter 2013, and increased by $1.2 million compared to the fourth quarter 2012. The increase in net interest income of $0.3 million in the fourth quarter 2013 as compared to the third quarter 2013 was the result of an increase in interest income of $0.3 million primarily as a result of a $34.2 million increase in average loans. The $1.2 million increase in net interest income in the fourth quarter 2013 as compared to the same quarter in 2012 was the result of a $0.7 million increase in interest income and a $0.5 million decline in interest expense. The increase in interest income in the fourth quarter 2013 compared to the same quarter in 2012 was primarily the result of a $172.0 million, or 15.2% increase in average loans, which was partially funded by a $144.3 million decrease in the average balance of low-yielding overnight cash. The decrease in interest expense as compared to the fourth quarter 2012 was primarily the result of the prepayment of $15.0 million in fixed, high-cost TruPS and related subordinated debentures in the first quarter 2013 as well as a six basis point decrease in the average cost of deposits.

Net interest income improved by approximately $3.2 million to $63.6 million for the year ended December 31, 2013 compared to $60.4 million for the year ended December 31, 2012. Interest income increased $1.1 million during 2013 as compared to 2012 primarily due to a $110.8 million increase in average earning assets, partially offset by a 21 basis point decline in average yield. The growth in average earning assets was mostly comprised of a $127.4 million increase in average loans and an $80.3 million increase in average investments, partially offset by a $97.0 million decrease in low-yielding average overnight cash during 2013 as compared to the prior year. The decline in the average yield on earning assets was mostly due to competitive pressure on loan yields. Interest expense declined $2.1 million during 2013 as compared to the prior year primarily due to the prepayment of high-cost TruPS and related subordinated debentures combined with a four basis point decline in average deposit costs.

Noninterest Income

The following table presents noninterest income as of the dates indicated:


		Quarter Ended							Year Ended
		December			September		December		December			December
		31, 2013			30, 2013		31, 2012		31, 2013			31, 2012
		(In thousands)
Noninterest income:
	Customer service and other fees	$	2,313		$	2,302	$	2,079	$	8,916		$	8,158
	Investment management and trust		831			736		561		2,904			1,751
	Increase in cash surrender value of life insurance		304			305		143		1,018			576
	Gain (loss) on sale of securities		(85	)		20		817		(11	)		2,527
	Gain on sale of SBA loans		95			207		-		725			203
	Other		16			94		166		247			376
	Total noninterest income	$	3,474		$	3,664	$	3,766	$	13,799		$	13,591

Fourth quarter 2013 noninterest income was $3.5 million as compared to third quarter 2013 noninterest income of $3.7 million and fourth quarter 2012 noninterest income of $3.8 million.

Fourth quarter 2013 noninterest income was $3.5 million, reflecting a $0.2 million decline as compared to the third quarter 2013 mostly due to $0.1 million decreases in both gain on sales of securities and gain on sales of SBA loans. As compared to the fourth quarter 2012, noninterest income decreased $0.3 million during the same period in 2013 primarily due to a $0.9 million decline in gain on sales of securities, partially offset by a $0.2 million increase in customer service income, including treasury management fees, a $0.3 million increase in investment management and trust income and a $0.2 million increase in BOLI income.

For the year ended December 31, 2013, noninterest income increased $0.2 million as compared to the prior year. The increase was primarily the result of a $1.2 million, or 65.8% increase in investment management and trust income, a $0.8 million increase in customer service charge income, a $0.5 million increase in gain on sales of SBA loans, and a $0.4 million increase in BOLI income as compared to the prior year. These increases were partially offset by a $2.5 million decrease in net gains on sales of securities as compared to the year ended December 31, 2012.

During 2013, assets under management increased by $120.3 million, or 35.1%, to $463.0 million as compared to $342.7 million at December 31, 2012. The growth in assets under management was primarily related to the Company's investment management subsidiary, Private Capital Management ("PCM"), acquired in July 2012. Since acquisition, PCM's assets under management have grown by $107.5 million, or 65.2%, primarily due to new customer relationships as well as growth in existing relationships. In addition, PCM has contributed approximately $2.2 million in investment management income since acquisition.

Noninterest Expense

The following table presents noninterest expense as of the dates indicated:


		Quarter Ended								Year Ended
		December 31, 2013			September 30, 2013			December 31, 2012		December 31, 2013			December 31, 2012
		(In thousands)
Noninterest expense:
	Salaries and employee benefits	$	7,685		$	7,242		$	6,832	$	29,581		$	26,769
	Occupancy expense		1,507			1,572			1,550		6,289			7,253
	Furniture and equipment		728			709			760		2,943			3,143
	Amortization of intangible assets		702			703			812		2,818			3,138
	Other real estate owned		(1,037	)		(200	)		3,209		(1,160	)		4,370
	Insurance and assessment		641			629			677		2,519			3,137
	Professional fees		968			886			1,543		3,618			4,089
	Prepayment penalty on long term debt		-			-			-		629			-
	Impairment of long-lived assets		-			-			-		-			2,750
	Other general and administrative		2,487			2,395			2,539		9,451			9,465
	Total noninterest expense	$	13,681		$	13,936		$	17,922	$	56,688		$	64,114

Noninterest expense decreased $0.3 million in the fourth quarter 2013 as compared to the third quarter 2013 and declined by $4.2 million compared to the fourth quarter of 2012.

The $0.3 million decrease in noninterest expense in the fourth quarter 2013 as compared to the third quarter 2013 was primarily the result of a $0.8 million decrease in other real estate owned ("OREO") expenses, partially offset by a $0.4 million increase in salaries and employee benefits. The decrease in OREO expense was mostly due to an increase in net gains on disposition of properties as well as reductions in net operating costs. The increase in salaries and employee benefits expense was primarily due to increases in salary and incentive expense. The $4.2 million decrease in noninterest expense in the fourth quarter 2013 as compared to the same quarter in 2012 was primarily due to a $4.2 million decrease in OREO expenses, mostly related to an increase in net gains on disposition of properties combined with a decline in OREO write-downs, and a $0.6 million decrease in professional fees primarily due to lower legal fees. These declines in noninterest expense were partially offset by a $0.9 million increase in salary and employee benefits expense, mostly due to higher costs associated with self-funded medical insurance, incentives and salary expense as compared to the fourth quarter 2012.

For the year ended December 31, 2013, noninterest expense decreased $7.4 million as compared to the same period in 2012. The largest declines in noninterest expense as compared to the prior year were attributable to a $5.5 million decrease in OREO expenses, mostly due to an increase in net gains on disposition of properties combined with a decline in write-downs on OREO, and the $2.8 million impairment of long-lived assets recorded in 2012. Other noninterest expense decreases included a $1.2 million decrease in occupancy, furniture and equipment expenses, mostly attributable to the closure of several branches in 2012; a $0.6 million decrease in insurance and assessment expense, primarily related to lower FDIC insurance premiums mostly as a result of changes pursuant to the Dodd-Frank Act effective April 1, 2012, as well as an improvement in the Bank's risk rating during the third quarter 2012; a $0.5 million decrease in professional fees expense, mostly related to legal costs and a $0.3 million decrease in the amortization of intangible assets as compared to the prior year. These decreases were partially offset by a $2.8 million increase in salaries and employee benefits primarily due to higher incentive and equity compensation expense as well as higher employee benefit expense related to the self-funded medical insurance plan as compared to the prior year.

Balance Sheet


	December			September			Percent		December			Percent
	31, 2013			30, 2013			Change		31, 2012			Change
	(Dollars in thousands)
Total assets	$	1,911,032		$	1,896,191		0.8	%	$	1,886,938		1.3	%
Average assets, quarter-to-date		1,905,524			1,878,081		1.5	%		1,843,212		3.4	%
Total loans, net of unearned loan fees		1,320,424			1,293,252		2.1	%		1,158,749		14.0	%
Total deposits		1,528,457			1,482,515		3.1	%		1,454,756		5.1	%

Equity ratio - GAAP		9.91	%		9.93	%	(0.2)	%		9.97	%	(0.6)	%
Tangible common equity ratio		9.60	%		9.58	%	0.2	%		9.53	%	0.7	%

At December 31, 2013, the Company had total assets of $1.9 billion, reflecting a $14.8 million increase compared to September 30, 2013 and a $24.1 million increase compared to December 31, 2012. The increase in total assets during the fourth quarter 2013 includes a $27.2 million increase in loans and a $21.9 million increase in securities sold or called, not yet settled, partially offset by a $29.0 million decrease in investments.

As compared to December 31, 2012, total assets reflects an increase in net loans of $161.7 million, or 14.0%, an increase of $16.0 million in securities sold or called, not yet settled and a $15.8 million increase in BOLI as compared to the prior year. These increases were partially offset by a $135.1 million decrease in cash and overnight funding, a $16.6 million decrease in investments, and a $15.1 million decrease in OREO.

The following table sets forth the amounts of loans outstanding at the dates indicated:


			December 31,			September 30,			December 31,
			2013			2013			2012
			(In thousands)
Loans held for sale			$	507		$	-		$	-
Commercial and residential real estate				856,224			823,442			737,537
Construction				87,940			82,711			72,842
Commercial				271,843			280,577			237,199
Agricultural				10,772			10,453			9,417
Consumer				60,932			60,876			63,095
SBA				31,010			32,454			37,207
Other				2,039			3,471			3,043
	Total gross loans			1,321,267			1,293,984			1,160,340
		Unearned loan fees		(843	)		(732	)		(1,591	)
	Loans, net of unearned loan fees		$	1,320,424		$	1,293,252		$	1,158,749

During the three months ended December 31, 2013, loans, net of unearned fees increased by $27.2 million. The increase in loans during the fourth quarter 2013 was primarily due to a $32.8 million increase in commercial and residential real estate loans consisting mostly of loans to finance the acquisition of single and multi-tenant commercial properties located within our Colorado footprint. Loans held for sale at December 31, 2013 includes two performing SBA loans that we expect to sell during the first quarter 2014.

In 2013, loans, net of unearned fees increased by $161.7 million, or 14.0%. The 2013 net loan growth was primarily comprised of a $118.7 million increase in commercial and residential real estate loans, including a $77.1 million increase in jumbo mortgage loans and a $34.6 million increase in commercial loans. The growth in loans was primarily the result of new customer relationships, utilization of existing lines of credit and declines in loan payoffs.

The following table sets forth the amounts of deposits outstanding at the dates indicated:


	December 31,		September 30,		December 31,
	2013		2013		2012
	(In thousands)
Noninterest bearing deposits	$	564,326	$	525,330	$	564,215
Interest-bearing demand and NOW		346,449		351,380		285,679
Money market		326,008		313,585		312,724
Savings		111,568		108,242		100,704
Time		180,106		183,978		191,434
Total deposits	$	1,528,457	$	1,482,515	$	1,454,756

Non-maturing deposits increased $49.8 million in the fourth quarter 2013 as compared to the third quarter 2013, and increased $85.0 million, or 6.7%, as compared to the fourth quarter 2012. At December 31, 2013, noninterest bearing deposits as a percentage of total deposits was 36.9% as compared to 35.4% at September 30, 2013 and 38.8% at December 31, 2012.

During the fourth quarter 2013, securities sold under agreements to repurchase decreased by $4.9 million compared to September 30, 2013 and decreased by $42.8 million compared to December 31, 2012. The decrease from the prior year end was primarily attributable to a single depositor whose balance was re-deployed into the depositor's operations during the second quarter 2013.

Total Federal Home Loan Bank ("FHLB") borrowings were $130.0 million at December 31, 2013 consisting of $110.0 million of term borrowings and $20.0 million of overnight advances on our line of credit. There was a $32.7 million reduction in FHLB borrowings during the fourth quarter 2013, due to a reduction in overnight advances on our line of credit. Total borrowings at December 31, 2012 consisted of $110.2 million of FHLB term notes.

Regulatory Capital Ratios

The following table provides the capital ratios of the Company and our subsidiary bank, Guaranty Bank and Trust Company ("Bank") as of the dates presented, along with the applicable regulatory capital requirements:


		Ratio at December 31, 2013		Ratio at December 31, 2012		Minimum Capital Requirement		Minimum Requirement for "Well-Capitalized" Institution
Total Risk-Based Capital Ratio
	Consolidated	14.96	%	16.27	%	8.00	%	N/A
	Guaranty Bank and Trust Company	14.37	%	15.52	%	8.00	%	10.00	%

Tier 1 Risk-Based Capital Ratio
	Consolidated	13.71	%	15.02	%	4.00	%	N/A
	Guaranty Bank and Trust Company	13.12	%	14.26	%	4.00	%	6.00	%

Leverage Ratio
	Consolidated	11.49	%	11.93	%	4.00	%	N/A
	Guaranty Bank and Trust Company	11.00	%	11.35	%	4.00	%	5.00	%

The declines in the consolidated total risk-based capital ratio and Tier 1 risk-based capital ratio between December 31, 2012 and December 31, 2013 were primarily attributable to the early redemption of $15.0 million of the Company's TruPS and related subordinated debentures during the first quarter 2013 combined with loan growth during 2013. The redemption of the TruPS and related subordinated debentures was funded by a dividend from the Bank. All three ratios continue to remain well above the minimum capital requirements for holding companies and well capitalized requirements for banks. In addition, the Company has computed its projected regulatory capital ratios on a pro forma basis under the final rule on Enhanced Regulatory Capital Standards, commonly referred to as Basel III. The Company and the Bank currently exceed the capital requirements set forth in the new rules that become effective in the first quarter 2015.

Asset Quality

The following table presents select asset quality data as of the dates indicated:


	December			September			June 30,			March 31,				December
	31, 2013			30, 2013			2013			2013				31, 2012
	(Dollars in thousands)
Nonaccrual loans and leases	$	15,476		$	18,095		$	19,430		$	31,482		$	13,692
Accruing loans past due 90 days or more ⁽¹⁾		-			-			84			40			224

Total nonperforming loans (NPLs)	$	15,476		$	18,095		$	19,514		$	31,522		$	13,916
Other real estate owned and foreclosed assets		4,493			6,211			6,460			8,606			19,580

Total nonperforming assets (NPAs)	$	19,969		$	24,306		$	25,974		$	40,128		$	33,496

Total classified assets	$	29,215		$	33,993		$	36,590		$	52,535		$	58,635

Accruing loans past due 30-89 days ⁽¹⁾	$	2,123		$	1,026		$	6,873		$	3,686		$	4,270

Allowance for loan losses	$	21,005		$	20,450		$	20,218		$	24,060		$	25,142

Selected ratios:
NPLs to loans, net of unearned loan fees ⁽²⁾		1.17	%		1.40	%		1.57	%		2.67	%		1.20	%
NPAs to total assets		1.04	%		1.28	%		1.39	%		2.18	%		1.78	%
Allowance for loan losses to NPLs		135.73	%		113.01	%		103.61	%		76.33	%		180.67	%
Allowance for loan losses to loans, net of unearned loan fees ⁽²⁾		1.59	%		1.58	%		1.63	%		2.04	%		2.17	%
Loans 30-89 days past due to loans, net of unearned loan fees ⁽²⁾		0.16	%		0.08	%		0.55	%		0.31	%		0.37	%
Texas ratio ⁽³⁾		8.71	%		10.72	%		11.70	%		18.17	%		14.37	%
Classified asset ratio ⁽⁴⁾		12.74	%		14.99	%		16.48	%		23.78	%		25.16	%


⁽¹⁾	Past due loans include both loans that are past due with respect to payments and loans that are past due because the loan has matured, and is in the process of renewal, but continues to be current with respect to payments.
⁽²⁾	Loans, net of unearned loan fees, exclude loans held for sale.
⁽³⁾	Texas ratio defined as total NPAs divided by subsidiary bank only Tier 1 Capital plus allowance for loan losses.
⁽⁴⁾	Classified asset ratio defined as total classified assets to subsidiary bank only Tier 1 Capital plus allowance for loan losses.

The following tables summarize past due loans held for investment by class as of the dates indicated:


December 31, 2013	30-89 Days Past Due		90 Days + Past Due and Still Accruing		Nonaccrual Loans		Total Past Due		Total Loans, Held for Investment
	(In thousands)
Commercial and residential real estate	$	590	$	-	$	3,277	$	3,867	$	855,677
Construction		277		-		10,283		10,560		87,884
Commercial		616		-		624		1,240		271,670
Consumer		146		-		924		1,070		60,893
Other		494		-		368		862		43,793
Total	$	2,123	$	-	$	15,476	$	17,599	$	1,319,917

December 31, 2012	30-89 Days Past Due		90 Days + Past Due and Still Accruing		Nonaccrual Loans		Total Past Due		Total Loans, Held for Investment
	(In thousands)
Commercial and residential real estate	$	832	$	224	$	8,034	$	9,090	$	736,524
Construction		-		-		-		-		72,742
Commercial		2,671		-		3,005		5,676		236,874
Consumer		140		-		1,332		1,472		63,009
Other		627		-		1,321		1,948		49,600
Total	$	4,270	$	224	$	13,692	$	18,186	$	1,158,749

At December 31, 2013, classified assets represented 12.7% of bank-level Tier 1 Capital plus allowance for loan losses compared to 25.2% at December 31, 2012. The continued reductions in this ratio were a result of a decline in classified assets of $29.4 million, or 50.2%, during the year ended December 31, 2013.

During the fourth quarter 2013, nonperforming assets decreased $4.3 million as compared to the third quarter 2013 and decreased by $13.5 million since December 31, 2012. The decline in nonperforming assets during 2013 was primarily the result of the sale of OREO properties, including a single property recorded at $10.9 million sold in the first quarter 2013. Nonperforming loans at December 31, 2013 includes one out-of-state loan participation with a balance of $10.7 million.

Net recoveries in the fourth quarter 2013 were $0.4 million as compared to net recoveries of $0.1 million in the third quarter 2013 and an immaterial amount of net recoveries in the fourth quarter 2012. The coverage ratio, defined as allowance for loan losses divided by nonperforming loans, increased favorably from 113.0% at September 30, 2013 to 135.7% at December 31, 2013. The increase in the coverage ratio reflects a $2.6 million reduction in nonperforming loans during the quarter in addition to the $0.6 million increase in the allowance for loan losses during the fourth quarter 2013.

During the quarter ended December 31, 2013, the Company recorded a $0.2 million provision for loan losses compared to $0.1 million provision in the third quarter 2013 and a $3.5 million credit provision recorded in the fourth quarter in 2012. The Company resumed recognition of a provision for loan losses in the third quarter 2013 due primarily to the pace of its loan growth during 2013.

Shares Outstanding

As of December 31, 2013, the Company had 21,303,707 shares of common stock outstanding, consisting of 20,284,707 shares of voting common stock, of which 386,525 shares were in the form of unvested stock awards and 1,019,000 shares of non-voting common stock.

Non-GAAP Financial Measures

This press release contains certain non-GAAP financial measures related to tangible assets, including tangible book value and tangible common equity, and pre-tax operating earnings adjusted for (if any) provision (credit) for loan losses, OREO expenses, debt termination expense, acquisition, reorganization and integration costs and securities gains and losses.

The Company discloses these non-GAAP financial measures to provide meaningful supplemental information regarding the Company's operational performance and to enhance investors' overall understanding of the Company's core financial performance. Management believes that these non-GAAP financial measures allow for additional transparency and are used by some investors, analysts and other users of the Company's financial information as performance measures. These non-GAAP financial measures are presented for supplemental informational purposes only and should not be considered a substitute for financial information presented in accordance with GAAP. These non-GAAP financial measures presented by the Company may be different from non-GAAP financial measures used by other companies.

The following non-GAAP schedule reconciles the non-GAAP pre-tax operating earnings to GAAP net income before income taxes as of the dates indicated:


		Quarter Ended									Year Ended
		December			September			December			December			December
		31, 2013			30, 2013			31, 2012			31, 2013			31, 2012
		(Dollars in thousands, except per share amounts)
Income before income taxes		$	6,030		$	5,648		$	4,561		$	20,385		$	11,888
Plus:
	Provision (credit) for loan losses		154			142			(3,500	)		296			(2,000	)
	Expenses (gains) related to other real estate owned, net		(1,037	)		(200	)		3,209			(1,160	)		4,370
	Prepayment penalty on long term debt		-			-			-			629			-
	Impairment of long-lived assets		-			-			-			-			2,750
Less:
	Gain (loss) on sale of securities		(85	)		20			817			(11	)		2,527
Pre-tax operating earnings		$	5,232		$	5,570		$	3,453		$	20,161		$	14,481

Weighted basic average common shares outstanding ⁽¹⁾:			20,884,542			20,873,601			20,797,681			20,867,064			20,786,806
Fully diluted average common shares outstanding ⁽¹⁾:			20,995,284			20,981,555			20,867,519			20,951,237			20,878,251

Pre-tax operating earnings per common share-basic ⁽¹⁾:		$	0.25		$	0.27		$	0.17		$	0.97		$	0.70
Pre-tax operating earnings per common share-diluted ⁽¹⁾:		$	0.25		$	0.27		$	0.17		$	0.96		$	0.69


⁽¹⁾	Share and per share amounts have been adjusted to reflect the Company's 1-for-5 reverse stock split on May 20, 2013.

The following non-GAAP schedules reconcile the book value per share to the tangible book value per share and the GAAP equity ratio to the tangible equity ratio as of the dates indicated:



Tangible Book Value per Common Share
	December 31,			September 30,			December 31,
	2013			2013			2012
	(Dollars in thousands, except per share amounts)
Total stockholders' equity	$	189,394		$	188,268		$	188,200
Less: Intangible assets		(6,530	)		(7,232	)		(9,348	)
Tangible common equity	$	182,864		$	181,036		$	178,852

Number of common shares outstanding		21,303,707			21,390,412			21,169,521

Book value per common share ⁽¹⁾	$	8.89		$	8.80		$	8.89
Tangible book value per common share ⁽¹⁾	$	8.58		$	8.46		$	8.45


⁽¹⁾	Share and per share amounts have been adjusted to reflect the Company's 1-for-5 reverse stock split on May 20, 2013.

Tangible Common Equity Ratio
	December 31,			September 30,			December 31,
	2013			2013			2012
	(Dollars in thousands)
Total stockholders' equity	$	189,394		$	188,268		$	188,200
Less: Intangible assets		(6,530	)		(7,232	)		(9,348	)
Tangible common equity	$	182,864			181,036			178,852

Total assets	$	1,911,032		$	1,896,191		$	1,886,938
Less: Intangible assets		(6,530	)		(7,232	)		(9,348	)
Tangible assets	$	1,904,502		$	1,888,959		$	1,877,590

Equity ratio - GAAP (total stockholders'equity / total assets)		9.91	%		9.93	%		9.97	%
Tangible common equity ratio (tangible common equity / tangible assets)		9.60	%		9.58	%		9.53	%

About Guaranty Bancorp

Guaranty Bancorp is a bank holding company that operates 27 branches in Colorado through a single bank, Guaranty Bank and Trust Company. The Bank provides banking and other financial services including commercial and industrial, real estate, construction, energy, consumer and agricultural loans throughout its targeted Colorado markets to consumers and small to medium-sized businesses, including the owners and employees of those businesses. The Bank and its subsidiary also provide wealth management services, including private banking, investment management, jumbo mortgage loans and trust services. More information about Guaranty Bancorp can be found at www.gbnk.com.

Forward-Looking Statements

This press release contains forward-looking statements, which are included in accordance with the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. In some cases, you can identify forward-looking statements by terminology such as "may," "will," "should," "could," "expects," "plans," "intends," "anticipates," "believes," "estimates," "predicts," "potential," or "continue," or the negative of such terms and other comparable terminology. These forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the Company's actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, among others, the following: failure to maintain adequate levels of capital and liquidity to support the Company's operations; general economic and business conditions in those areas in which the Company operates; demographic changes; competition; fluctuations in interest rates; continued ability to attract and employ qualified personnel; ability to receive regulatory approval for the bank subsidiary to declare dividends to the Company; adequacy of the allowance for loan losses, changes in credit quality and the effect of credit quality on the provision for credit losses and allowance for loan losses; changes in governmental legislation or regulation, including, but not limited to, any increase in FDIC insurance premiums; changes in accounting policies and practices; changes in business strategy or development plans; changes in the securities markets; changes in consumer spending, borrowing and savings habits; the availability of capital from private or government sources; competition for loans and deposits and failure to attract or retain loans and deposits; changes in the financial performance and/or condition of our borrowers and the ability of our borrowers to perform under the terms of their loans and terms of other credit agreements; political instability, acts of war or terrorism and natural disasters; and additional "Risk Factors" referenced in the Company's most recent Annual Report on Form 10-K/A filed with the Securities and Exchange Commission, as supplemented from time to time. When relying on forward-looking statements to make decisions with respect to the Company, investors and others are cautioned to consider these and other risks and uncertainties. The Company can give no assurance that any goal or plan or expectation set forth in any forward-looking statement can be achieved and readers are cautioned not to place undue reliance on such statements, which speak only as of the date made. The forward-looking statements are made as of the date of this press release, and, except as may otherwise be required by law, the Company does not intend, and assumes no obligation, to update the forward-looking statements or to update the reasons why actual results could differ from those projected in the forward-looking statements.



GUARANTY BANCORP AND SUBSIDIARIES
Unaudited Consolidated Balance Sheets

				December 31,			September 30,			December 31,
				2013			2013			2012
				(In thousands)
Assets
Cash and due from banks				$	28,077		$	33,465		$	163,217
Time deposits with banks					-			-			8,000
Securities available for sale, at fair value					384,957			422,421			413,382
Securities held to maturity					41,738			33,385			31,283
Bank stocks, at cost					15,605			15,451			14,262
			Total investments		442,300			471,257			458,927

Loans held for sale					507			-			-

Loans, held for investment, net of unearned loan fees					1,319,917			1,293,252			1,158,749
	Less allowance for loan losses				(21,005	)		(20,450	)		(25,142	)
			Net loans, held for investment		1,298,912			1,272,802			1,133,607

Premises and equipment, net					48,080			45,846			46,918
Other real estate owned and foreclosed assets					4,493			6,211			19,580
Other intangible assets, net					6,530			7,232			9,348
Securities sold or called, not yet settled					21,917			-			5,878
Bank owned life insurance					31,410			31,156			15,564
Other assets					28,806			28,222			25,899
			Total assets	$	1,911,032		$	1,896,191		$	1,886,938

Liabilities and Stockholders' Equity
Liabilities:
	Deposits:
		Noninterest-bearing demand		$	564,326		$	525,330		$	564,215
		Interest-bearing demand and NOW			346,449			351,380			285,679
		Money market			326,008			313,585			312,724
		Savings			111,568			108,242			100,704
		Time			180,106			183,978			191,434
			Total deposits		1,528,457			1,482,515			1,454,756
Securities sold under agreement to repurchase and federal funds purchased					24,284			29,139			67,040
Borrowings					130,000			162,701			110,163
Subordinated debentures					25,774			25,774			41,239
Securities purchased, not yet settled					3,839			-			16,943
Interest payable and other liabilities					9,284			7,794			8,597
			Total liabilities		1,721,638			1,707,923			1,698,738

Stockholders' equity:
	Common stock and additional paid-in capital - common stock				706,514			706,459			705,389
	Accumulated deficit				(405,494	)		(409,060	)		(417,957	)
	Accumulated other comprehensive income (loss)				(8,954	)		(6,665	)		3,165
	Treasury stock				(102,672	)		(102,466	)		(102,397	)
			Total stockholders' equity		189,394			188,268			188,200
			Total liabilities and stockholders' equity	$	1,911,032		$	1,896,191		$	1,886,938

GUARANTY BANCORP AND SUBSIDIARIES
Unaudited Consolidated Statements of Operations

			Quarter Ended December 31,						Year Ended December 31,
			2013			2012			2013			2012
			(In thousands, except share and per share data)
Interest income:
	Loans, including fees		$	14,762		$	14,303		$	57,435		$	57,326
	Investment securities:
		Taxable		2,437			2,127			9,432			8,746
		Tax-exempt		692			691			2,990			2,558
	Dividends			169			156			664			631
	Federal funds sold and other			10			99			117			304
		Total interest income		18,070			17,376			70,638			69,565
Interest expense:
	Deposits			610			693			2,490			2,878
	Securities sold under agreement to repurchase and federal funds purchased			10			22			49			67
	Borrowings			857			836			3,407			3,327
	Subordinated debentures			202			608			1,122			2,882
		Total interest expense		1,679			2,159			7,068			9,154
		Net interest income		16,391			15,217			63,570			60,411
Provision for loan losses				154			(3,500	)		296			(2,000	)
		Net interest income, after provision for loan losses		16,237			18,717			63,274			62,411
Noninterest income:
	Customer service and other fees			2,313			2,079			8,916			8,158
	Investment management and trust			831			561			2,904			1,751
	Increase in cash surrender value of life insurance			304			143			1,018			576
	Gain (loss) on sale of securities			(85	)		817			(11	)		2,527
	Gain on sale of SBA loans			95			-			725			203
	Other			16			166			247			376
		Total noninterest income		3,474			3,766			13,799			13,591
Noninterest expense:
	Salaries and employee benefits			7,685			6,832			29,581			26,769
	Occupancy expense			1,507			1,550			6,289			7,253
	Furniture and equipment			728			760			2,943			3,143
	Amortization of intangible assets			702			812			2,818			3,138
	Other real estate owned, net			(1,037	)		3,209			(1,160	)		4,370
	Insurance and assessments			641			677			2,519			3,137
	Professional fees			968			1,543			3,618			4,089
	Prepayment penalty on long term debt			-			-			629			-
	Impairment of long-lived assets			-			-			-			2,750
	Other general and administrative			2,487			2,539			9,451			9,465
		Total noninterest expense		13,681			17,922			56,688			64,114
		Income before income taxes		6,030			4,561			20,385			11,888
Income tax expense (benefit)				1,942			1,441			6,356			(3,171	)
		Net income	$	4,088		$	3,120		$	14,029		$	15,059

Earnings per common share-basic⁽¹⁾:			$	0.20		$	0.15		$	0.67		$	0.72
Earnings per common share-diluted⁽¹⁾:				0.19			0.15			0.67			0.72

Dividend declared per common share:			$	0.03		$	-		$	0.08		$	-

Weighted average common shares outstanding-basic⁽¹⁾:				20,884,542			20,797,681			20,867,064			20,786,806
Weighted average common shares outstanding-diluted⁽¹⁾:				20,995,284			20,867,519			20,951,237			20,878,251


⁽¹⁾	Share and per share amounts have been adjusted to reflect the Company's 1-for-5 reverse stock split on May 20, 2013.

GUARANTY BANCORP AND SUBSIDIARIES
Unaudited Consolidated Average Balance Sheets

		QTD Average						YTD Average
		December		September		December		December		December
		31, 2013		30, 2013		31, 2012		31, 2013		31, 2012
		(In thousands)
Assets
Interest earning assets
	Loans, net of unearned loan fees	$	1,301,815	$	1,267,647	$	1,129,893	$	1,237,697	$	1,110,267
	Securities		464,987		476,269		451,342		485,582		405,240
	Other earning assets		14,708		9,830		159,038		32,414		129,391
Average earning assets			1,781,510		1,753,746		1,740,273		1,755,693		1,644,898
Other assets			124,014		124,335		102,939		107,885		104,217
Total average assets		$	1,905,524	$	1,878,081	$	1,843,212	$	1,863,578	$	1,749,115

Liabilities and Stockholders' Equity
Average liabilities:
Average deposits:
	Noninterest-bearing deposits	$	547,739	$	510,367	$	521,000	$	521,876	$	496,940
	Interest-bearing deposits		953,336		962,134		895,729		934,247		867,259
	Average deposits		1,501,075		1,472,501		1,416,729		1,456,123		1,364,199
Other interest-bearing liabilities			205,242		209,471		232,004		209,430		197,633
Other liabilities			8,140		8,723		8,736		8,491		7,983
Total average liabilities			1,714,457		1,690,695		1,657,469		1,674,044		1,569,815
Average stockholders' equity			191,067		187,386		185,743		189,534		179,300
Total average liabilities and stockholders' equity		$	1,905,524	$	1,878,081	$	1,843,212	$	1,863,578	$	1,749,115

GUARANTY BANCORP
Unaudited Credit Quality Measures

		Quarter Ended
		December			September			June 30,		March 31,			December
		31, 2013			30, 2013			2013		2013			31, 2012
		(Dollars in thousands)
Nonaccrual loans and leases		$	15,476		$	18,095		19,430		$	31,482		$	13,692
Accruing loans past due 90 days or more			-			-		84			40			224
	Total nonperforming loans	$	15,476		$	18,095		19,514		$	31,522		$	13,916

Other real estate owned and foreclosed assets			4,493			6,211		6,460			8,606			19,580
	Total nonperforming assets	$	19,969		$	24,306		25,974		$	40,128		$	33,496

Total classified assets		$	29,215		$	33,993		36,590		$	52,535		$	58,635

Nonperforming loans		$	15,476		$	18,095		19,514		$	31,522		$	13,916
Performing troubled debt restructurings			4,852			2,500		2,675			1,268			3,838
Allocated allowance for loan losses			(565	)		(1,450	)	(1,524	)		(6,474	)		(2,654	)
	Net investment in impaired loans	$	19,763		$	19,145		20,665		$	26,316		$	15,100

Accruing loans past due 30-89 days		$	2,123		$	1,026		6,873		$	3,686		$	4,270

Charged-off loans		$	644		$	110		4,996		$	1,523		$	1,199
Recoveries			(1,045	)		(200	)	(1,154	)		(441	)		(1,244	)
	Net charge-offs	$	(401	)	$	(90	)	3,842		$	1,082		$	(45	)

Provision for loan loss		$	154		$	142		-		$	-		$	(3,500	)

Allowance for loan losses		$	21,005		$	20,450		20,218		$	24,060		$	25,142

Allowance for loan losses to loans, net of unearned loan fees ⁽¹⁾			1.59	%		1.58	%	1.63	%		2.04	%		2.17	%
Allowance for loan losses to nonaccrual loans			135.73	%		113.01	%	104.06	%		76.42	%		183.63	%
Allowance for loan losses to nonperforming loans			135.73	%		113.01	%	103.61	%		76.33	%		180.67	%
Nonperforming assets to loans, net of unearned loan fees and other real estate owned ⁽¹⁾			1.51	%		1.87	%	2.08	%		3.37	%		2.84	%
Nonperforming assets to total assets			1.04	%		1.28	%	1.39	%		2.18	%		1.78	%
Nonaccrual loans to loans, net of unearned loan fees ⁽¹⁾			1.17	%		1.40	%	1.57	%		2.67	%		1.18	%
Nonperforming loans to loans, net of unearned loan fees ⁽¹⁾			1.17	%		1.40	%	1.57	%		2.67	%		1.20	%
Annualized net charge-offs to average loans			(0.12)	%		(0.03)	%	1.27	%		0.38	%		(0.02)	%


⁽¹⁾	Loans, net of unearned loan fees, exclude loans held for sale.

Contact Information:

Contacts:
Paul W. Taylor
President and Chief Executive Officer
Guaranty Bancorp
1331 Seventeenth Street, Suite 345
Denver, CO 80202
(303) 293-5563

Christopher G. Treece
E.V.P., Chief Financial Officer and Secretary
Guaranty Bancorp
1331 Seventeenth Street, Suite 345
Denver, CO 80202
(303) 675-1194

Guaranty Bancorp Announces 2013 Annual and Fourth Quarter Financial Results