GBNK Guaranty Bancorp (delisted)

Guaranty Bancorp (Nasdaq:GBNK) (“we”, “our” or “the Company”), a community bank holding company based in Colorado, today announced second quarter 2018 net income of $13.3 million, or $0.46 per basic and diluted common share, compared to net income of $10.1 million, or $0.36 per basic and diluted common share, in the second quarter 2017. The $3.1 million increase in second quarter 2018 net income, compared to the same quarter in 2017, was primarily attributable to higher net interest income resulting from higher average loan balances, increased loan yields, and a reduced tax rate.

On an operating basis1, the Company’s second quarter 2018 return on average assets was 1.52% compared to 1.21% for the same quarter in 2017. On a GAAP basis, the Company’s return on average assets was 1.43% in the second quarter 2018 compared to 1.19% for the same quarter in 2017. The difference between the Company’s second quarter 2018 operating and GAAP return on average assets is primarily attributable to $1.0 million in merger-related expenses incurred in the second quarter 2018.

“Once again, we are very pleased with our second quarter results,” said Paul W. Taylor, President and Chief Executive Officer of Guaranty Bancorp. “We achieved significant improvement in profitability with an exceptional operating return on average assets1 of 1.52% for the second quarter 2018 compared to 1.21% for the same quarter in 2017. In addition, our improved efficiency ratio of 50.73% in the second quarter 2018, compared to 53.77% during the same quarter in 2017, further demonstrates our focus on expense management. Our net income growth of $3.1 million, or 31% to $13.3 million compared to second quarter 2017 was a direct result of our success in expanding our customer relationships and gaining market share.”

Taylor continued, “Gross loan production during the quarter was strong, up 18% or $42.4 million quarter-over-quarter to $275.5 million. Due to the continued dynamic economy in Colorado, paydowns and maturities jumped during the quarter to $246.1 million.  On a net basis, loans increased by $29.3 million, or 4.1% on an annualized basis during the quarter. We are excited to build upon this success by joining together with Independent Bank Group, Inc., one of the premier community banks in the nation.”  ________________________

1 This press release contains certain 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. See the “Non-GAAP Financial Measures” section later in this press release for a definition of operating earnings and other non-GAAP measures.

Key Financial Measures

Income Statement

		Three Months Ended										Six Months Ended
		June 30,			March 31,			June 30,				June 30,			June 30,
		2018			2018			2017				2018			2017
		(Dollars in thousands, except per share amounts)
Net income	$	13,263		$	13,557		$	10,125			$	26,820		$	19,965
Operating earnings (1)		14,116			13,440			10,232				27,556			20,064
Earnings per common share - diluted		0.46			0.47			0.36				0.92			0.71
Earnings per common share - diluted - operating (1)		0.49			0.46			0.36				0.95			0.71
Return on average assets		1.43	%		1.48	%		1.19	%			1.45	%		1.19	%
Return on average assets - operating (1)		1.52	%		1.47	%		1.21	%			1.49	%		1.19	%
Return on average equity		12.79	%		13.45	%		11.13	%			13.12	%		11.15	%
Return on average equity - operating (1)		13.61	%		13.33	%		11.25	%			13.48	%		11.20	%
Net interest margin		3.80	%		3.77	%		3.74	%			3.79	%		3.69	%
Net interest margin, fully tax equivalent (2)		3.87	%		3.84	%		3.85	%			3.86	%		3.80	%
Efficiency ratio - tax equivalent (3)		50.73	%		52.91	%		53.77	%			51.81	%		54.53	%
Average cost of interest-bearing liabilities
(including noninterest-bearing deposits)		0.59	%		0.52	%		0.46	%			0.56	%		0.44	%
Average cost of deposits
(including noninterest-bearing deposits)		0.38	%		0.31	%		0.26	%			0.34	%		0.25	%
Assets under management	$	1,502		$	1,465		$	792			$	1,502		$	792
________________________
(1) See reconciliation of non-GAAP financial measures to the corresponding GAAP measurement in "Non-GAAP Financial Measures" later in this document.
(2) The tax-equivalent basis was computed by calculating the deemed interest on municipal bonds and tax-exempt loans that would have been earned on a fully taxable basis to yield the same after-tax income, net of the interest expense disallowance under Internal Revenue Code Sections 265 and 291, using a combined federal and state marginal tax rate of 24.66% for 2018 and 38% for 2017.
(3) The efficiency ratio equals noninterest expense adjusted to exclude amortization of intangible assets, prepayment penalties on long-term debt, impairment of long-lived assets, litigation-related settlements and merger related expenses, divided by the sum of tax equivalent net interest income and tax equivalent noninterest income. To calculate tax equivalent net interest income and noninterest income, the interest earned on tax exempt loans and investment securities and the income earned on bank-owned life insurance have been adjusted to reflect the amount that would have been earned had these investments been subject to normal income taxation.

Balance Sheet

		June 30,					March 31,					December 31,					September 30,					June 30,
		2018				2018					2017					2017					2017
		(Dollars in thousands, except per share amounts)
Total investments	$	598,316				$	598,391				$	614,312				$	576,459				$	569,812
Total loans, net of deferred costs and fees		2,876,721					2,847,465					2,807,388					2,661,866					2,578,472
Allowance for loan losses		(23,750	)				(23,350	)				(23,250	)				(22,900	)				(23,125	)
Total assets		3,775,967					3,721,651					3,698,890					3,510,046					3,403,852
Total deposits		2,947,795					3,031,714					2,941,627					2,898,060					2,763,623
Book value per common share		14.29					14.01					13.86					13.21					12.94
Tangible book value per common share (1)		11.41					11.09					11.13					10.75					10.46
Equity ratio - GAAP		11.10		%			11.03		%			10.95		%			10.69		%			10.80		%
Tangible common equity ratio (1)		9.06		%			8.93		%			8.99		%			8.88		%			8.91		%
Total risk-based capital ratio		13.51		%			13.31		%			13.36		%			13.50		%			13.65		%
________________________
(1) See reconciliation of non-GAAP financial measures to the corresponding GAAP measurement in "Non-GAAP Financial Measures" later in this document.

Net Interest Income and Margin

The following tables present, for the periods indicated, average assets, liabilities and stockholders’ equity, as well as interest income from average interest-earning assets, interest expense from average interest-bearing liabilities and the resultant yields and costs expressed in percentages. Nonaccrual loans are included in the calculation of average loans and leases, while interest thereon is excluded from the computation of yield earned.

	Three Months Ended							Three Months Ended							Three Months Ended
		June 30, 2018							March 31, 2018							June 30, 2017
		Average Balance		Interest Income or Expense	Average Yield or Cost				Average Balance		Interest Income or Expense	Average Yield or Cost				Average Balance		Interest Income or Expense	Average Yield or Cost
		(Dollars in thousands)
Assets:
Interest-earning assets:
Gross loans, net of deferred costs
and fees (1)(3)	$	2,858,683	$	33,549	4.71	%		$	2,835,485	$	32,115	4.59	%		$	2,581,043	$	28,976	4.50	%
Investment securities (1)
Taxable		357,286		2,555	2.87	%			364,652		2,556	2.84	%			354,230		2,356	2.67	%
Tax-exempt		215,158		1,230	2.29	%			217,367		1,223	2.28	%			201,893		1,243	2.47	%
Bank stocks (4)		26,052		391	6.02	%			26,845		423	6.39	%			23,531		347	5.91	%
Other earning assets		8,669		38	1.76	%			4,788		19	1.61	%			4,549		11	0.97	%
Total interest-earning assets		3,465,848		37,763	4.37	%			3,449,137		36,336	4.27	%			3,165,246		32,933	4.17	%
Non-earning assets:
Cash and due from banks		36,025							35,518							34,714
Other assets		229,342							230,000							204,149
Total assets	$	3,731,215						$	3,714,655						$	3,404,109
Liabilities and Stockholders’ Equity:
Interest-bearing liabilities:
Deposits:
Interest-bearing demand and NOW	$	840,354	$	486	0.23	%		$	811,790	$	368	0.18	%		$	807,883	$	354	0.18	%
Money market		516,430		807	0.63	%			538,740		623	0.47	%			479,009		402	0.34	%
Savings		208,785		58	0.11	%			204,544		56	0.11	%			179,862		49	0.11	%
Time certificates of deposit		462,551		1,426	1.24	%			461,901		1,224	1.07	%			414,533		981	0.95	%
Total interest-bearing deposits		2,028,120		2,777	0.55	%			2,016,975		2,271	0.46	%			1,881,287		1,786	0.38	%
Borrowings:
Repurchase agreements		55,358		27	0.20	%			43,711		21	0.19	%			31,794		15	0.19	%
Federal funds purchased		2,327		23	3.91	%			1		-	1.95	%			1		-	1.46	%
Subordinated debentures		65,098		933	5.75	%			65,077		889	5.54	%			65,014		856	5.28	%
Borrowings		209,928		1,125	2.15	%			232,188		1,062	1.85	%			182,617		777	1.71	%
Total interest-bearing liabilities		2,360,831		4,885	0.83	%			2,357,952		4,243	0.73	%			2,160,713		3,434	0.64	%
Noninterest bearing liabilities:
Demand deposits		939,010							931,562							864,359
Other liabilities		15,437							16,389							14,078
Total liabilities		3,315,278							3,305,903							3,039,150
Stockholders' equity		415,937							408,752							364,959
Total liabilities and stockholders' equity	$	3,731,215						$	3,714,655						$	3,404,109
Net interest income			$	32,878						$	32,093						$	29,499
Net interest margin					3.80	%						3.77	%						3.74	%
Net interest margin, fully tax
equivalent (2)					3.87	%						3.84	%						3.85	%

(1) Yields on loans and securities have not been adjusted to a tax-equivalent basis.(2) The tax-equivalent basis was computed by calculating the deemed interest on municipal bonds and tax-exempt loans that would have been earned on a fully taxable basis to yield the same after-tax income, net of the interest expense disallowance under Internal Revenue Code Sections 265 and 291, using a combined federal and state marginal tax rate of 24.66% for 2018 and 38.01% for 2017. (3) The loan average balances and rates include nonaccrual loans. (4) Includes Bankers’ Bank of the West stock, Federal Reserve Bank stock, Federal Home Loan Bank stock and Pacific Coast Bankers’ Bank stock.

Net Interest Income and Margin (continued)

	Six Months Ended							Six Months Ended
		June 30, 2018							June 30, 2017
		Average Balance		Interest Income or Expense	Average Yield or Cost				Average Balance		Interest Income or Expense	Average Yield or Cost
		(Dollars in thousands)
Assets:
Interest-earning assets:
Gross loans, net of deferred costs
and fees (1)(3)	$	2,847,149	$	65,664	4.65	%		$	2,560,845	$	56,368	4.44	%
Investment securities (1)
Taxable		360,948		5,111	2.86	%			357,993		4,671	2.63	%
Tax-exempt		216,257		2,453	2.29	%			201,993		2,480	2.48	%
Bank stocks (4)		26,446		814	6.21	%			23,883		736	6.21	%
Other earning assets		6,739		57	1.71	%			4,324		19	0.89	%
Total interest-earning assets		3,457,539		74,099	4.32	%			3,149,038		64,274	4.12	%
Non-earning assets:
Cash and due from banks		35,773							35,121
Other assets		229,640							205,053
Total assets	$	3,722,952						$	3,389,212
Liabilities and Stockholder’s Equity:
Interest-bearing liabilities:
Deposits:
Interest-bearing demand and NOW	$	826,151	$	854	0.21	%		$	790,478	$	712	0.18	%
Money market		527,523		1,430	0.55	%			484,688		735	0.31	%
Savings		206,676		114	0.11	%			175,823		96	0.11	%
Time certificates of deposit		462,228		2,650	1.16	%			394,410		1,780	0.91	%
Total interest-bearing deposits		2,022,578		5,048	0.50	%			1,845,399		3,323	0.36	%
Borrowings:
Repurchase agreements		49,567		48	0.20	%			34,117		32	0.19	%
Federal funds purchased		1,170		23	3.91	%			1		-	1.46	%
Subordinated debentures		65,087		1,822	5.65	%			65,004		1,700	5.27	%
Borrowings		220,996		2,187	2.00	%			196,570		1,548	1.59	%
Total interest-bearing liabilities		2,359,398		9,128	0.78	%			2,141,091		6,603	0.62	%
Noninterest bearing liabilities:
Demand deposits		935,307							872,251
Other liabilities		15,883							14,725
Total liabilities		3,310,588							3,028,067
Stockholders' equity		412,364							361,145
Total liabilities and stockholders' equity	$	3,722,952						$	3,389,212
Net interest income			$	64,971						$	57,671
Net interest margin					3.79	%						3.69	%
Net interest margin, fully tax
equivalent (2)					3.86	%						3.80	%

(1) Yields on loans and securities have not been adjusted to a tax-equivalent basis.(2) The tax-equivalent basis was computed by calculating the deemed interest on municipal bonds and tax-exempt loans that would have been earned on a fully taxable basis to yield the same after-tax income, net of the interest expense disallowance under Internal Revenue Code Sections 265 and 291, using a combined federal and state marginal tax rate of 24.66% for 2018 and 38.01% for 2017. (3) The loan average balances and rates include nonaccrual loans. (4) Includes Bankers’ Bank of the West stock, Federal Reserve Bank stock, Federal Home Loan Bank stock and Pacific Coast Bankers’ Bank stock.

Net Interest Income and Margin (continued)

Net interest income increased $3.4 million in the second quarter 2018 to $32.9 million, compared to $29.5 million in the second quarter 2017, and increased $0.8 million from $32.1 million in the first quarter 2018.

The $3.4 million increase in net interest income in the second quarter 2018, compared to the second quarter 2017, was a result of a $4.8 million increase in interest income, partially offset by a $1.5 million increase in interest expense over the same period. The increase in interest income was mostly the result of a $300.6 million increase in average interest earning assets in the second quarter 2018, compared to the second quarter 2017, and a twenty basis point increase in the average yield on interest earning assets over the same time period. The increase in interest expense was due to the increasing cost of interest-bearing liabilities in addition to growth in deposits and borrowings.

The $0.8 million increase in net interest income in the second quarter 2018, compared to the first quarter 2018, was primarily due to a $1.4 million increase in interest income partially offset by a $0.6 million increase in interest expense. Interest income increased in the second quarter 2018 as a result of increased loan yields and increased average loan balances. Accretion of the discount on acquired loans was $1.1 million in the second quarter 2018, compared to $1.0 million in the first quarter 2018 and $1.2 million in the second quarter 2017.  The increase in interest expense in the second quarter 2018, compared to the first quarter 2018, was primarily a result of a $0.5 million increase in interest expense on deposits resulting from growth in average interest bearing deposit balances and a nine basis point increase in the cost of deposits.

For the six months ended June 30, 2018, net interest income increased $7.3 million, compared to the same period in 2017, primarily due to a $9.8 million increase in interest income resulting from a $308.5 million or 9.8% increase in average earning assets, partially offset by a $2.5 million increase in interest expense. The increase in interest expense was due to the increasing cost of interest-bearing liabilities in addition to growth in deposits and borrowings.

Noninterest Income

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

		Three Months Ended							Six Months Ended
		June 30, 2018		March 31, 2018		June 30, 2017			June 30, 2018		June 30, 2017
		(In thousands)
Noninterest income:
Deposit service and other fees	$	3,646	$	3,321	$	3,545		$	6,967	$	6,825
Investment management and trust		2,466		2,298		1,483			4,764		3,004
Increase in cash surrender value of
life insurance		661		670		615			1,331		1,210
Gain on sale of securities		16		-		-			16		-
Gain on sale of SBA loans		255		231		447			486		828
Other		311		450		252			761		877
Total noninterest income	$	7,355	$	6,970	$	6,342		$	14,325	$	12,744

Second quarter 2018 noninterest income increased by $1.0 million compared to the second quarter 2017 and by $0.4 million compared to the first quarter 2018. The increase was primarily due to a $1.0 million increase in investment management and trust income in the second quarter 2018, compared to the second quarter 2017, which was primarily a result of the January 2018 purchase of the assets under management of Wagner Wealth Management, LLC (“Wagner”). At June 30, 2018, assets under management were $1.5 billion compared to $792 million as of June 30, 2017.

Compared to the first quarter 2018, noninterest income increased $0.4 million in the second quarter 2018, primarily as a result of increased deposit service charges and investment management and trust income.

For the six months ended June 30, 2018, noninterest income increased $1.6 million, compared to the same period in 2017, primarily due to increased investment management and trust income resulting from the Wagner acquisition.

Noninterest Expense

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

		Three Months Ended							Six Months Ended
		June 30, 2018		March 31, 2018		June 30, 2017			June 30, 2018		June 30, 2017
		(In thousands)
Noninterest expense:
Salaries and employee benefits	$	12,871	$	12,903	$	11,247		$	25,774	$	23,173
Occupancy expense		1,681		1,738		1,674			3,419		3,226
Furniture and equipment		1,031		1,060		975			2,091		1,920
Amortization of intangible assets		952		912		648			1,864		1,297
Other real estate owned, net		2		39		126			41		194
Insurance and assessments		670		697		647			1,367		1,353
Professional fees		1,040		1,091		1,252			2,131		2,226
Impairment of long-lived assets		-		-		34			-		224
Other general and administrative		4,424		3,506		3,900			7,930		7,419
Total noninterest expense	$	22,671	$	21,946	$	20,503		$	44,617	$	41,032

Second quarter 2018 noninterest expense increased $2.2 million compared to the second quarter 2017 and by $0.7 million compared to the first quarter 2018. The increase in noninterest expense in the second quarter 2018, compared to the second quarter 2017, was mostly due to a $1.6 million increase in salaries and employee benefits, primarily as a result of employees added in the fourth quarter 2017 acquisition of Castle Rock and the first quarter 2018 Wagner acquisition, and a $1.0 million increase in merger-related expenses, included in other general and administrative expense, as a result of the pending merger with and into Independent Bank Group, Inc. (“Independent”).

Compared to the first quarter 2018, noninterest expense increased $0.7 million in the second quarter 2018, primarily as a result of a $1.0 million increase in merger-related expenses related to the pending merger with and into Independent.

For the six months ended June 30, 2018, noninterest expense increased $3.6 million, compared to the same period in 2017, due to a $2.6 million increase in salaries and employee benefits primarily attributable to the fourth quarter 2017 acquisition of Castle Rock and the first quarter 2018 Wagner acquisition, combined with the $1.1 million increase in merger-related expenses due to the pending merger with and into Independent.

Tax Expense

The Company’s 2018 income tax expense has been favorably impacted by the Tax Cuts and Jobs Act of 2017, which was signed into law in December 2017. This new tax law reduced the statutory federal corporate tax rate from 35.0% to 21.0% beginning on January 1, 2018. The Company’s second quarter 2018 income tax expense and effective tax rate were $3.8 million and 22.1%, respectively, compared to income tax expense and an effective tax rate of $5.0 million and 33.1% in the second quarter 2017. During the first quarter 2018, the Company’s income tax expense of $3.4 million and effective tax rate of 19.9% reflected the direct benefit to tax expense of $327,000 related to the vesting of shares of Company restricted stock. The direct tax benefit recognized in the first quarter 2018 reflected an appreciation in the Company’s stock price between the grant date and the vesting date. The majority of vestings of the Company’s restricted stock occurs annually in the first quarter.

Balance Sheet

		June 30,				March 31,				December 31,				September 30,				June 30,
		2018				2018				2017				2017				2017
		(Dollars in thousands)
Total assets	$	3,775,967			$	3,721,651			$	3,698,890			$	3,510,046			$	3,403,852
Average assets, quarter-to-date		3,731,215				3,714,655				3,603,552				3,423,224				3,404,109
Total loans, net of deferred costs and fees		2,876,721				2,847,465				2,807,388				2,661,866				2,578,472
Total deposits		2,947,795				3,031,714				2,941,627				2,898,060				2,763,623
Equity ratio - GAAP		11.10	%			11.03	%			10.95	%			10.69	%			10.80	%
Tangible common equity ratio (1)		9.06	%			8.93	%			8.99	%			8.88	%			8.91	%
________________________
(1) See reconciliation of non-GAAP financial measures to the corresponding GAAP measurement in "Non-GAAP Financial Measures" later in this document.

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

	June 30,			March 31,				December 31,		September 30,			June 30,
		2018			2018			2017			2017			2017
		(In thousands)
Loans held for sale	$	1,766		$	1,940		$	1,725		$	314		$	887
Commercial and residential real estate		2,023,729			2,003,326			1,977,431			1,892,828			1,799,114
Construction		122,789			107,707			99,965			81,826			99,632
Commercial		547,206			543,818			523,355			499,936			490,771
Consumer		124,396			133,670			143,066			124,625			122,994
Other		56,502			57,123			61,982			62,277			64,920
Total gross loans		2,876,388			2,847,584			2,807,524			2,661,806			2,578,318
Deferred costs and (fees)		333			(119	)		(136	)		60			154
Loans, net		2,876,721			2,847,465			2,807,388			2,661,866			2,578,472
Less allowance for loan losses		(23,750	)		(23,350	)		(23,250	)		(22,900	)		(23,125	)
Net loans	$	2,852,971		$	2,824,115		$	2,784,138		$	2,638,966		$	2,555,347

The following table presents the quarterly changes in the Company’s loan balances at the dates indicated:

		June 30,			March 31,			December 31,			September 30,			June 30,
		2018			2018			2017			2017			2017
		(In thousands)
Beginning balance	$	2,847,584		$	2,807,524		$	2,661,806		$	2,578,318		$	2,570,745
New credit extended		164,258			156,311			186,969			192,774			132,420
Acquisition of Castle Rock Bank		-			-			71,052			-			-
Net existing credit advanced		111,266			76,770			77,307			59,275			73,298
Net pay-downs and maturities		(246,108	)		(192,986	)		(191,624	)		(165,520	)		(196,511	)
Other		(612	)		(35	)		2,014			(3,041	)		(1,634	)
Gross loans		2,876,388			2,847,584			2,807,524			2,661,806			2,578,318
Deferred costs and (fees)		333			(119	)		(136	)		60			154
Loans, net	$	2,876,721		$	2,847,465		$	2,807,388		$	2,661,866		$	2,578,472
Net change - loans outstanding	$	29,256		$	40,077		$	145,522		$	83,394		$	7,722

During the second quarter 2018, loans net of deferred costs and fees increased $29.3 million, comprised of $275.5 million in new loans and advances on existing loans, partially offset by $246.1 million in net pay-downs and maturities during the quarter. In addition to contractual loan principal payments and maturities, the second quarter 2018 included $67.6 million in early payoffs related to our borrowers selling their assets, $2.7 million in loan pay-downs related to fluctuations in loan balances of existing customers, and $44.5 million in loan payoffs related to our strategic decision not to match certain financing terms offered by competitors.

Balance Sheet (continued)

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

		June 30,		March 31,		December 31,		September 30,		June 30,
		2018		2018		2017		2017		2017
		(In thousands)
Noninterest-bearing demand	$	924,415	$	973,172	$	939,550	$	924,361	$	876,043
Interest-bearing demand and NOW		835,378		849,741		813,882		866,309		811,639
Money market		519,916		531,818		527,621		502,400		475,656
Savings		206,710		210,376		201,687		183,366		183,200
Time		461,376		466,607		458,887		421,624		417,085
Total deposits	$	2,947,795	$	3,031,714	$	2,941,627	$	2,898,060	$	2,763,623

At June 30, 2018, total deposits were $2.9 billion, an increase of $6.2 million compared to December 31, 2017 and an increase of $184.2 million compared to June 30, 2017. The Company acquired $128.4 million in deposits in the October 2017 Castle Rock transaction. At June 30, 2018, noninterest-bearing deposits as a percentage of total deposits were 31.4%, compared to 31.9% at December 31, 2017 and 31.7% at June 30, 2017.

Regulatory Capital Ratios

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

	Ratio at June 30, 2018		Ratio at December 31, 2017		Minimum Requirement for “Adequately Capitalized” Institution plus fully phased in Capital Conservation Buffer		Minimum Requirement for "Well-Capitalized" Institution
Common Equity Tier 1 Risk-Based Capital Ratio
Consolidated	10.75	%	10.57	%	7.00	%	N/A
Guaranty Bank and Trust Company	12.08	%	12.29	%	7.00	%	6.50	%
Tier 1 Risk-Based Capital Ratio
Consolidated	11.53	%	11.36	%	8.50	%	N/A
Guaranty Bank and Trust Company	12.08	%	12.29	%	8.50	%	8.00	%
Total Risk-Based Capital Ratio
Consolidated	13.51	%	13.36	%	10.50	%	N/A
Guaranty Bank and Trust Company	12.82	%	13.03	%	10.50	%	10.00	%
Leverage Ratio
Consolidated	10.18	%	10.21	%	4.00	%	N/A
Guaranty Bank and Trust Company	10.67	%	11.05	%	4.00	%	5.00	%

At June 30, 2018, all of our regulatory capital ratios remained well above minimum requirements for a “well-capitalized” institution. Our consolidated capital ratios generally increased compared to December 31, 2017, primarily due to 2018 earnings. At June 30, 2018, our bank-level capital ratios declined compared to December 31, 2017, primarily due to the $23.8 million dividend paid to the Company in the second quarter 2018 to fund stockholder dividends and debt servicing in 2018.

Asset Quality

The following table presents select asset quality data, including quarterly charged-off loans, recoveries and provision for loan losses as of the dates indicated:

		June 30,				March 31,				December 31,				September 30,				June 30,
		2018				2018				2017				2017				2017
		(Dollars in thousands)
Originated nonaccrual loans	$	3,348			$	3,696			$	3,932			$	3,935			$	3,332
Purchased credit impaired loans		1,157				1,495				1,622				809				1,290
Accruing loans past due 90 days or more (1)		370				-				-				-				-
Total nonperforming loans (NPLs)	$	4,875			$	5,191			$	5,554			$	4,744			$	4,622
Other real estate owned and foreclosed assets		629				629				761				-				113
Total nonperforming assets (NPAs)	$	5,504			$	5,820			$	6,315			$	4,744			$	4,735
Total classified assets	$	25,552			$	26,125			$	28,330			$	28,186			$	29,188
Accruing loans past due 30-89 days (1)	$	2,546			$	2,671			$	2,869			$	9,129			$	957
Charged-off loans	$	(332	)		$	(261	)		$	(117	)		$	(970	)		$	(338	)
Recoveries		202				173				183				248				82
Net (charge-offs) recoveries	$	(130	)		$	(88	)		$	66			$	(722	)		$	(256	)
Provision for loan losses	$	530			$	188			$	284			$	497			$	206
Allowance for loan losses	$	23,750			$	23,350			$	23,250			$	22,900			$	23,125
Unaccreted loan discount (2)	$	10,939			$	12,046			$	13,049			$	11,654			$	12,665
Selected ratios:
NPLs to loans, net of deferred costs and fees (3)		0.17		%		0.18		%		0.20		%		0.18		%		0.18		%
NPAs to total assets		0.15		%		0.16		%		0.17		%		0.14		%		0.14		%
Allowance for loan losses to NPLs		487.18		%		449.82		%		418.62		%		482.72		%		500.32		%
Allowance for loan losses to loans, net of
deferred costs and fees (3)		0.83		%		0.82		%		0.83		%		0.86		%		0.90		%
Loans 30-89 days past due to loans, net of
deferred costs and fees (3)		0.09		%		0.09		%		0.10		%		0.34		%		0.04		%
Texas ratio (4)		1.33		%		1.38		%		1.53		%		1.22		%		1.26		%
Classified asset ratio (5)		6.99		%		6.73		%		7.43		%		7.57		%		8.08		%
________________________
(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) Related to loans acquired in the Home State and Castle Rock transactions.
(3) Loans, net of deferred costs and fees, exclude loans held for sale.
(4) Texas ratio defined as total NPAs divided by subsidiary bank only Tier 1 Capital plus allowance for loan losses.
(5) Classified asset ratio defined as total classified assets to subsidiary bank only Tier 1 Capital plus allowance for loan losses.

Asset Quality (continued)

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

June 30, 2018		30-89 Days Past Due		90 Days + Past Due and Still Accruing		90 Days +  Past Due and Nonaccrual		Total Nonaccrual and Past Due		Total Loans, Held for Investment
		(In thousands)
Commercial and residential
real estate	$	182	$	-	$	176	$	358	$	2,023,964
Construction		-		-		-		-		122,803
Commercial		707		170		3,144		4,021		547,269
Consumer		455		200		47		702		124,410
Other		1,202		-		1,138		2,340		56,509
Total	$	2,546	$	370	$	4,505	$	7,421	$	2,874,955

December 31, 2017		30-89 Days Past Due		90 Days + Past Due and Still Accruing		90 Days +  Past Due and Nonaccrual		Total Nonaccrual and Past Due		Total Loans, Held for Investment
		(In thousands)
Commercial and residential
real estate	$	410	$	-	$	1,750	$	2,160	$	1,977,335
Construction		-		-		-		-		99,960
Commercial		1,663		-		2,079		3,742		523,330
Consumer		469		-		444		913		143,059
Other		327		-		1,281		1,608		61,979
Total	$	2,869	$	-	$	5,554	$	8,423	$	2,805,663

At June 30, 2018, nonperforming assets were $5.5 million, a decrease of $0.3 million compared to March 31, 2018 and an increase of $0.8 million compared to June 30, 2017. As a result of the Castle Rock transaction, the Company acquired $1.6 million of nonperforming loans and $0.8 million of other real estate owned. At June 30, 2018, performing troubled debt restructurings were $16.8 million, compared to $18.4 million at March 31, 2018 and $23.4 million at June 30, 2017. The year-over-year decrease in performing troubled debt restructurings was primarily due to the payoff of a $9.4 million out-of-state loan syndication during the third quarter 2017, partially offset by the modification of a single commercial loan during the fourth quarter 2017.

Net charge offs were $0.1 million during the second quarter 2018, compared to net charge-offs of $0.1 million during the first quarter 2018 and net charge-offs of $0.3 million in the second quarter 2017. During the second quarter 2018, the Bank recorded a $0.5 million provision for loan losses, compared to a $0.2 million provision in the first quarter 2018 and a $0.2 million provision in the second quarter 2017. The Bank considered recoveries, historical charge-offs, the level of nonperforming loans, loan growth and other factors when determining the adequacy of the allowance for loan losses and the resulting amount of loan loss provision to be recognized during the quarter.

Shares Outstanding

As of June 30, 2018, the Company had 29,308,857 shares of voting common stock outstanding, of which 441,335 shares were in the form of unvested stock awards.

Non-GAAP Financial Measures

The Company discloses certain non-GAAP financial measures related to tangible assets, including tangible book value and tangible common equity, and operating earnings adjusted for merger-related expenses, net losses or write-downs related to OREO, debt termination expense, impairments of long-lived assets, litigation-related settlements, securities gains and losses, net deferred tax asset write-downs and gains or losses on the sale or disposal of other assets. The Company also discloses the following GAAP profitability metrics alongside the operating earnings equivalent: return on average assets, return on average equity and earnings per share (diluted).

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 operating earnings to GAAP net income as of the dates indicated:

	Three Months Ended														Six Months Ended
		June 30,				March 31,				June 30,					June 30,				June 30,
		2018				2018				2017					2018				2017
		(Dollars in thousands, except per share amounts)
Net income	$	13,263			$	13,557			$	10,125				$	26,820			$	19,965
Expenses adjusted for:
Losses (gains) related to other real
estate owned, net		-				33				126					33				194
Merger-related expenses		1,033				75				-					1,108				-
Impairment of long-lived assets		-				-				34					-				224
Income adjusted for:
(Gain) on sale of securities		(16	)			-				-					(16	)			-
(Gain) loss on sale of other assets		8				(281	)			14					(273	)			(257	)
Pre-tax operating earnings adjustment		1,025				(173	)			174					852				161
Tax effect of adjustments (1)		(172	)			56				(67	)				(116	)			(62	)
Tax effected operating earnings adjustment		853				(117	)			107					736		-		99
Operating earnings	$	14,116			$	13,440			$	10,232				$	27,556			$	20,064
Average assets	$	3,731,215			$	3,714,655			$	3,404,109				$	3,722,952			$	3,389,212
Average equity	$	415,937			$	408,752			$	364,959				$	412,364			$	361,145
Fully diluted average common
shares outstanding:		29,048,850				29,036,820				28,095,871					29,067,349				28,120,746
Earnings per common
share–diluted:	$	0.46			$	0.47			$	0.36				$	0.92			$	0.71
Earnings per common
share–diluted - operating:	$	0.49			$	0.46			$	0.36				$	0.95			$	0.71
ROAA (GAAP)		1.43		%		1.48		%		1.19		%			1.45		%		1.19		%
ROAA - operating		1.52		%		1.47		%		1.21		%			1.49		%		1.19		%
ROAE (GAAP)		12.79		%		13.45		%		11.13		%			13.12		%		11.15		%
ROAE - operating		13.61		%		13.33		%		11.25		%			13.48		%		11.20		%
________________
(1) Tax effect calculated using a combined federal and state marginal tax rate of 24.66% for 2018 and 38.01% for 2017, adjusted for tax effect of nondeductible merger-related expenses.

Non-GAAP Financial Measures (continued)

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
		June 30,				March 31,				December 31,				September 30,				June 30,
		2018				2018				2017				2017				2017
		(Dollars in thousands, except per share amounts)
Total stockholders' equity	$	418,951			$	410,432			$	404,899			$	375,152			$	367,529
Less: Goodwill and other intangible assets		(84,655	)			(85,608	)			(79,547	)			(69,752	)			(70,424	)
Tangible common equity	$	334,296			$	324,824			$	325,352			$	305,400			$	297,105
Number of common shares outstanding		29,308,857				29,297,002				29,222,264				28,401,870				28,406,758
Book value per common share	$	14.29			$	14.01			$	13.86			$	13.21			$	12.94
Tangible book value per common share	$	11.41			$	11.09			$	11.13			$	10.75			$	10.46

Tangible Common Equity Ratio
		June 30,				March 31,				December 31,				September 30,				June 30,
		2018				2018				2017				2017				2017
		(Dollars in thousands)
Total stockholders' equity	$	418,951			$	410,432			$	404,899			$	375,152			$	367,529
Less: Goodwill and other intangible assets		(84,655	)			(85,608	)			(79,547	)			(69,752	)			(70,424	)
Tangible common equity	$	334,296			$	324,824			$	325,352			$	305,400			$	297,105
Total assets	$	3,775,967			$	3,721,651			$	3,698,890			$	3,510,046			$	3,403,852
Less: Goodwill and other intangible assets		(84,655	)			(85,608	)			(79,547	)			(69,752	)			(70,424	)
Tangible assets	$	3,691,312			$	3,636,043			$	3,619,343			$	3,440,294			$	3,333,428
Equity ratio - GAAP (total stockholders'
equity / total assets)		11.10		%		11.03		%		10.95		%		10.69		%		10.80		%
Tangible common equity ratio (tangible
common equity / tangible assets)		9.06		%		8.93		%		8.99		%		8.88		%		8.91		%

About Guaranty Bancorp

Guaranty Bancorp is a $3.8 billion financial services company that operates as the bank holding company for Guaranty Bank and Trust Company, a premier Colorado community bank. The Bank provides comprehensive financial solutions to consumers and small to medium-sized businesses that value local and personalized service. In addition to loans and depository services, the Bank also offers wealth management solutions, including trust and investment management 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, including the impact of global and national economic conditions on our local economy; 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 and the effects of the Tax Cuts and Jobs Act of 2017; changes in accounting policies and practices; changes in business strategy or development plans; failure or inability to complete mergers or other corporate transactions; failure or inability to realize fully the expected benefits of mergers or other corporate transactions; difficulty retaining key employees; the parties being unable to successfully implement integration strategies or to achieve expected synergies and operating efficiencies within the expected time-frames or at all; 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; failure to recognize expected cost savings; 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; changes in oil and natural gas prices; 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 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 SUBSIDIARIESUnaudited Consolidated Balance Sheets
		June 30,			December 31,			June 30,
		2018			2017			2017
		(In thousands)
Assets
Cash and due from banks	$	72,348		$	51,553		$	46,582
Time deposits with banks		254			254			254
Securities available for sale, at fair value		316,499			329,977			305,910
Securities held to maturity		253,398			259,916			240,899
Bank stocks, at cost		28,419			24,419			23,003
Total investments		598,316			614,312			569,812
Loans held for sale		1,766			1,725			887
Loans, held for investment, net of deferred costs and fees		2,874,955			2,805,663			2,577,585
Less allowance for loan losses		(23,750	)		(23,250	)		(23,125	)
Net loans, held for investment		2,851,205			2,782,413			2,554,460
Premises and equipment, net		63,957			65,874			64,774
Other real estate owned and foreclosed assets		629			761			113
Goodwill		67,917			65,106			56,404
Other intangible assets, net		16,738			14,441			14,020
Bank owned life insurance		79,706			78,573			74,050
Other assets		23,131			23,878			22,496
Total assets	$	3,775,967		$	3,698,890		$	3,403,852
Liabilities and Stockholders’ Equity
Liabilities:
Deposits:
Noninterest-bearing demand	$	924,415		$	939,550		$	876,043
Interest-bearing demand and NOW		835,378			813,882			811,639
Money market		519,916			527,621			475,656
Savings		206,710			201,687			183,200
Time		461,376			458,887			417,085
Total deposits		2,947,795			2,941,627			2,763,623
Securities sold under agreement to repurchase		56,856			44,746			29,553
Federal Home Loan Bank line of credit borrowing		220,700			157,444			90,900
Federal Home Loan Bank term notes		50,000			70,000			71,772
Subordinated debentures, net		65,106			65,065			65,023
Interest payable and other liabilities		16,559			15,109			15,452
Total liabilities		3,357,016			3,293,991			3,036,323
Stockholders’ equity:
Common stock and additional paid-in capital - common stock		861,307			859,541			833,600
Accumulated deficit		(324,931	)		(343,383	)		(354,956	)
Accumulated other comprehensive loss		(9,757	)		(4,694	)		(5,112	)
Treasury stock		(107,668	)		(106,565	)		(106,003	)
Total stockholders’ equity		418,951			404,899			367,529
Total liabilities and stockholders’ equity	$	3,775,967		$	3,698,890		$	3,403,852

GUARANTY BANCORP AND SUBSIDIARIESUnaudited Consolidated Statements of Operations
		Three Months Ended June 30,					Six Months Ended June 30,
		2018		2017			2018		2017
		(In thousands, except share and per share data)
Interest income:
Loans, including costs and fees	$	33,549	$	28,976		$	65,664	$	56,368
Investment securities:
Taxable		2,555		2,356			5,111		4,671
Tax-exempt		1,230		1,243			2,453		2,480
Dividends		391		347			814		736
Federal funds sold and other		38		11			57		19
Total interest income		37,763		32,933			74,099		64,274
Interest expense:
Deposits		2,777		1,786			5,048		3,323
Securities sold under agreement to repurchase		27		15			48		32
Federal funds purchased		23		-			23		-
Borrowings		1,125		777			2,187		1,548
Subordinated debentures		933		856			1,822		1,700
Total interest expense		4,885		3,434			9,128		6,603
Net interest income		32,878		29,499			64,971		57,671
Provision for loan losses		530		206			718		211
Net interest income, after provision for loan losses		32,348		29,293			64,253		57,460
Noninterest income:
Deposit service and other fees		3,646		3,545			6,967		6,825
Investment management and trust		2,466		1,483			4,764		3,004
Increase in cash surrender value of life insurance		661		615			1,331		1,210
Gain on sale of securities		16		-			16		-
Gain on sale of SBA loans		255		447			486		828
Other		311		252			761		877
Total noninterest income		7,355		6,342			14,325		12,744
Noninterest expense:
Salaries and employee benefits		12,871		11,247			25,774		23,173
Occupancy expense		1,681		1,674			3,419		3,226
Furniture and equipment		1,031		975			2,091		1,920
Amortization of intangible assets		952		648			1,864		1,297
Other real estate owned, net		2		126			41		194
Insurance and assessments		670		647			1,367		1,353
Professional fees		1,040		1,252			2,131		2,226
Impairment of long-lived assets		-		34			-		224
Other general and administrative		4,424		3,900			7,930		7,419
Total noninterest expense		22,671		20,503			44,617		41,032
Income before income taxes		17,032		15,132			33,961		29,172
Income tax expense		3,769		5,007			7,141		9,207
Net income	$	13,263	$	10,125		$	26,820	$	19,965
Earnings per common share–basic:	$	0.46	$	0.36		$	0.93	$	0.72
Earnings per common share–diluted:		0.46		0.36			0.92		0.71
Dividend declared per common share:		0.16		0.13			0.33		0.25
Weighted average common shares outstanding-basic:		28,863,536		27,913,082			28,843,295		27,890,446
Weighted average common shares outstanding-diluted:		29,048,850		28,095,871			29,067,349		28,120,746

Contacts:	Paul W. Taylor		Christopher G. Treece
	President and Chief Executive Officer		E.V.P., Chief Financial Officer and Secretary
	Guaranty Bancorp		Guaranty Bancorp
	1331 Seventeenth Street, Suite 200		1331 Seventeenth Street, Suite 200
	Denver, CO 80202		Denver, CO 80202
	(303) 293-5563		(303) 675-1194