2020 SUMMARY
ANNUAL REPORT
AMES NATIONAL CORPORATION AT A GLANCE
BACKGROUND
Ames National Corporation (ANC) is an Iowa-based
AFFILIATE BANK STRUCTURE
Each affiliate bank operates independently with a
bank holding company. ANC was organized and
board of directors and a bank president. Decisions are
incorporated on January 21, 1975, under the laws of
made locally, which means customers receive quick
the State of Iowa to serve as a holding company for
responses to questions, and services are customized
its principal banking subsidiary, First National Bank,
to meet customer needs in each community.
Ames, Iowa. In 1983, ANC acquired the stock of State
Bank & Trust Co. located in Nevada, Iowa; in 1991, ANC
The affiliate banks’ lending activities consist primarily
acquired Boone Bank & Trust Co., located in Boone,
Iowa; in 1995, ANC acquired the stock of Reliance
State Bank located in Story City, Iowa; and in 2002,
of short-term and medium-term commercial,
agricultural and residential real estate loans,
agricultural and business operating loans, lines of
ANC chartered and commenced operations of United
credit, home improvement loans and the origination
Bank & Trust NA, located in Marshalltown, Iowa. In
2012, Reliance State Bank acquired an office located
in Garner, Iowa. In 2014, First National Bank acquired
three offices located in West Des Moines and Johnston,
Iowa, and three locations in the Osceola, Iowa area in
2018. In 2019, ANC acquired Iowa State Savings Bank in
the Creston, Iowa area.
of mortgage loans for sale into the secondary market.
Affiliate banks also offer a variety of checking, savings
and time deposits accounts, cash management
services, wealth management and trust services,
merchant credit card processing and safe deposit box
services. Convenient access to funds and account
information is also available through: Online Banking,
Video Banking, Mobile Banking, Online Bill Pay, Mobile
Wallet, online statements and debit cards.
AMES NATIONAL CORPORATION SERVICES
ANC provides various services to the affiliate banks, which include: management assistance, payroll, internal
auditing, human resources, compliance management, marketing assistance, loan review, technology support,
training and employee development. ANC employees seek to incorporate efficiencies across the affiliate banks’
operational functions so the affiliate bank management teams can focus on what they do best: banking and
taking care of customers’ financial needs.
MISSION STATEMENT
Ames National Corporation is a results-oriented financial services holding
company providing leadership, counsel and support to its community affiliate
banks and superior performance for its shareholders.
CORE VALUES
Ames National Corporation’s foundation is built on these values which guide our actions.
EXCELLENCE • INTEGRITY • LEADERSHIP
STABILITY • TRUST • COMMUNITY
STRATEGIC DIRECTION
The Ames National Corporation five-year strategic plan is focused on three driving initiatives:
EMPLOYEE ENGAGEMENT
Enhance systems and activities to acquire, develop
CONTINUOUS IMPROVEMENT
Continually improve key processes to increase
and retain employees.
customer engagement, employee engagement
and shareholder value.
CUSTOMER ENGAGEMENT
Develop a customer experience that supports
relationship growth and customer acquistion.
2
2020 Annual Report | Ames National Corporation
Ames National Corporation | 2020 Annual Report
3
LETTER TO SHAREHOLDERS
The journey of 2020 was unprecedented and unanticipated.
Early in the first quarter, we realized that 2020 would be
a year like no other. Though our plans and expectations
quickly changed due to the pandemic, we could not be
more proud of our affiliate bank teams and their resilience
in adjusting and adapting throughout this year.
Driven by these core value promises, Ames National
Corporation was able to reach record levels in net income,
assets, loans and deposits. We are pleased to provide our
2020 financial overview and highlight drivers of the record
growth.
We have always emphasized that it is imperative for our
organization that decisions are made by leaders who work
directly with customers to best understand their needs and
community needs.
This philosophy proved to be valuable when faced with
the rapidly changing COVID-19 environment and its
varying effects on the communities we serve. Our affiliate
leadership teams were responsive, caring and diligent in
finding solutions to continue to serve our employees,
customers and communities while keeping health and
safety as a top priority. Digital Banking usage reached new
highs as customers took even greater advantage of our
online and mobile delivery. In addition, affiliate bank offices
remained open to continue to provide personal service.
Through flexibility, innovation, discernment and empathy,
our leaders responded and forged a unique path in 2020.
Customers value the continuum of services provided by our
team of experts at each life stage. We are in the long-term
relationship building business. Whether opening up a child’s
first savings account, purchasing a first home, assisting with
finances during retirement or managing business cash flow,
we know just how important relationships are as we walk
alongside our customers every day, but especially through
events like a pandemic. Although it seemed that each day
brought a new set of challenges, whether pandemic or
derecho-related, we remained focused on delivering on our
core values of:
EXCELLENCE • INTEGRITY • LEADERSHIP •
STABILITY • TRUST • COMMUNITY
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2020 Annual Report | Ames National Corporation
FINANCIAL RESULTS
Net income for 2020 totaled a record $18.9 million or $2.06
per share, compared to $17.2 million or $1.86 per share
earned in 2019. The increase in earnings was primarily the
result of the Iowa State Savings Bank acquisition, growth
in mortgage lending and a reduction in interest expense
due to declines in market rates. We are pleased to report
that, as a result of the 2019 acquisition, Iowa State Savings
Bank contributed $1.7 million in earnings to the bottom
line in 2020 compared to just over $300,000 for a partial
year in 2019. Earnings were partially offset by a $4.4 million
increase in the provision for loan losses in 2020 compared
to 2019. The increase in the loan loss reserve was a result
of the economic slowdown associated with the COVID-19
pandemic on our loan portfolio and, to a lesser extent, loan
growth.
Loan interest income was $6.2 million higher in 2020 in
2019. This increase was primarily due to the Iowa State
Savings Bank acquisition, Paycheck Protection Program
(PPP) loans and organic loan growth, offset in part by
a reduction in interest rates. Deposit interest expense
decreased $2.4 million, mostly due to market interest
rate declines. Net interest income for 2020 totaled $54.8
million, a $9.6 million increase, or 21%, compared to 2019.
Non-interest income for 2020 totaled $10.6 million, as
compared to $8.6 million in 2019, an increase of 23%. The
three factors that drove growth in noninterest income were
an uptick in refinancing of home loans in a low interest
rate environment, security gains on investment sales and
customers seeking wealth management and trust services
advice. Income from the sale of residential loans was up
nearly $1.1 million over 2019, security gains were $413,000
higher in 2020 than in 2019, while Wealth Management
income increased just over $250,000.
The balance sheet for 2020 also showed record growth.
Assets reached $2.0 billion, an increase of $238.5 million
compared to 2019. Investment securities, PPP loans and
organic loan growth were the drivers of this 14% rise in
assets. These assets were funded mainly due to a surge
in deposits as a result of the federal government stimulus
programs. Deposits reached record levels, and totaled $1.7
billion at year-end, 15% higher than year-end 2019, and this
growth was mainly in commercial and retail core deposits.
The amount of government stimulus dollars that have been
injected into the economy is unprecedented. Deposits held
by all FDIC insured institutions in the United States totaled
$17.1 trillion as of September 30, 2020 which compares to
$14.3 trillion as of September 30, 2019. This excess liquidity
in the banking system has contributed to a challenging
environment, as we work to deploy investable funds. Loan
prospects and bond issuers have a significant number of
options which constrains funding opportunities and puts
downward pressure on yields.
Despite these constraints, 2020 net loans increased 8%,
to $1.1 billion, as compared to $1.0 billion in 2019. Ames
National Corporation affiliate banks extended credit for local
projects and funded nearly $80 million in PPP loans to assist
business owners through the economic slowdown due to
the pandemic. During the fourth quarter, the Affiliate Banks
began the process of assisting PPP loan customers with the
loan forgiveness application process and $34.1 million in
loans had been granted forgiveness by the end of the year.
OUR AFFILIATE BANKS
continue to support the local economy, small businesses
and our customers and have begun processing applications
for the second Phase of the PPP in response to additional
government stimulus programs.
ECONOMIC OUTLOOK
As mentioned earlier, the Company’s provision for loan
losses increased by $4.4 million in 2020 as a precaution to
safeguard from uncertainties in the market derived from
the pandemic. We are optimistic that consumer confidence
will rebound with the vaccine rollout which we expect
to result in a more normalized economic environment.
Nevertheless, boosting the loan loss reserve will help us
weather uncertainties in the market and fortify the balance
sheet. We are also appreciative of the diversification of our
loan portfolio. With a quality mix of commercial, agricultural
and residential loans, we believe we are well-positioned for
potential uncertain economic conditions.
IN SUMMARY
As we begin 2021, we are hopeful and excited for the
opportunities ahead. Our management teams will focus on
the factors that we can control. We have a talented team
of bankers that will continue to build on our past success
and find opportunities to strengthen our Company. We
continue to set high standards for profitable growth and
are focused on serving our communities. On behalf of
the employees and board of directors, thank you for your
ongoing support of Ames National Corporation, and we
appreciate the opportunity to serve you.
ANNUAL MEETING
We look forward to providing you additional financial
highlights at our Annual Meeting of Shareholders which
will be held on April 28, 2021 at 4:30 p.m. More details are
available on page 15 of this report.
We encourage you to attend the annual meeting virtually.
Thomas H. Pohlman
Chairman
John P. Nelson
President & CEO
Ames National Corporation | 2020 Annual Report
5
FINANCIAL HIGHLIGHTS
As of December 31, 2020
PERFORMANCERECORD
THREE-YEAR FINANCIAL HIGHLIGHTS
Net Income
$18.9 Million
Assets
$2.0 Billion
Dividends Paid Per
Share
$0.99
ROA
1.01%
ROE
9.48%
ATLO Closing Price
$24.02
Per Common Share
2020
Cash Dividends Declared $0.75
Cash Dividends Paid
$0.99
Loan Quality
Market Price Per Share
2020 2019
2020 2019
Allowance
1.50% 1.19%
Closing
$24.02 $28.06
Dividend Payout
36.41%
Net Charge-Offs 0.10% 0.04%
High
$26.87 $29.46
Dividend Yield
3.12%
Non Performing 1.33% 0.48%
Low
$16.62 $24.47
$19.0
$18.5
$18.0
$17.5
$17.0
$16.5
$16
$15.5
$15
$14.5
$14
$13.5
$13
$2,000
$1,900
$1,800
$1,700
$1,600
$1,500
$1,400
$1,300
$1,200
$1,100
$1,000
$900
$800
$700
.
9
8
1
$
0
2
0
2
.
2
7
1
$
9
1
0
2
Earnings
Millions of Dollars
6
6
8
,
1
$
0
2
0
2
4
0
5
,
1
$
9
1
0
2
.
0
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1
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2
5
8
3
,
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8
1
0
2
$2.30
$2.20
$2.10
$2.00
$1.90
$1.80
$1.70
$1.60
$1.50
$1.40
$1.30
$1.20
$1.10
$1,700
$1,600
$1,500
$1,400
$1,300
$1,200
$1,100
$1,000
$900
$800
$700
$600
$500
$400
6
0
2
$
.
0
2
0
2
6
8
.
1
$
9
1
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2
Earnings Per Share
Dollars
1
1
6
,
1
$
0
2
0
2
8
6
2
,
1
$
9
1
0
2
$230
$220
$210
$200
$190
$180
$170
$160
$150
$140
$130
$120
$110
$1,400
$1,300
$1,200
$1,100
$1,000
$900
$800
$700
$600
$500
$400
$300
$200
$100
3
8
.
1
$
8
1
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2
8
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1
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1
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8
1
0
2
9
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0
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8
8
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9
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2
Capital
Millions of Dollars
8
3
1
,
1
$
0
2
0
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1
2
9
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9
1
0
2
3
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4
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8
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8
1
0
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6
2020 Annual Report | Ames National Corporation
Average Total Assets
Millions of Dollars
Average Deposits
Millions of Dollars
Average Loans
Millions of Dollars
Ames National Corporation | 2020 Annual Report
7
AFFILIATE BANKS
Contact: (515) 432-6200
www.boonebankiowa.com
Charter: State
Organized: 1883
Offices: Two locations in
Boone, Iowa
Employees: 20
Capital: $15.9 Million
Assets: $150 Million
2020 Net Income: $1.6 Million
Contact: (515) 232-5561
www.FNB247.com
Charter: National
Organized: 1903
Offices: Nine locations in Ames,
Ankeny, Johnston, Osceola, and
West Des Moines, Iowa
Employees: 132
Capital: $101 Million
Assets: $1.0 Billion
2020 Net Income: $9.8 Million
Contact: (641) 753-5900
www.ISSBbank.com
Charter: State
Organized: 1883
Offices: Three locations in
Creston and Lenox, Iowa
Employees: 38
Capital: $26.8 Million
Assets: $237 Million
2020 Net Income: $1.7 Million
Contact: (515) 733-4396
www.RSBiowa.com
Charter: State
Organized: 1928
Offices: Two locations in Story
City and Garner, Iowa
Employees: 33
Capital: $30 Million
Assets: $259 Million
2020 Net Income: $2.6 Million
Contact: (641) 753-5900
www.ubtna.com
Charter: National
Organized: 2002
Offices: Two locations in
Marshalltown, Iowa
Employees: 21
Capital: $11.4 Million
Assets: $118 Million
2020 Net Income: $1.2 Million
Contact: (515) 382-2191
www.bankSBT.com
Charter: State
Organized: 1939
Offices: One location in
Nevada, Iowa
Employees: 22
Capital: $17.6 Million
Assets: $197 Million
2020 Net Income: $2.6 Million
8
2020 Annual Report | Ames National Corporation
Ames National Corporation | 2020 Annual Report
9
CONSOLIDATED BALANCE SHEETS
Unaudited
CONSOLIDATED STATEMENTS OF INCOME
Unaudited
ASSETS
Cash and due from banks
Interest bearing deposits in financial institutions and federal funds sold
Securities available-for-sale
Federal Home Loan Bank (FHLB) and Federal Reserve Bank (FRB) stock, at cost
Loans receivable, net
Loans held for sale
Bank premises and equipment, net
Accrued income receivable
Other real estate owned
Bank-owned life insurance
Deferred income taxes
Other intangible assets, net
Goodwill
Other assets
Total assets
LIABILITIES AND STOCKHOLDERS’ EQUITY
LIABILITIES
Deposits
Non-interest bearing checking
Interest bearing checking
Savings and money market
Time, $250,000 and over
Other time
Total deposits
Securities sold under agreements to repurchase
FHLB advances
Dividends payable
Deferred Income Taxes
Accrued expenses and other liabilities
Total liabilities
STOCKHOLDERS’ EQUITY
Common stock, $2 par value, authorized 18,000,000 shares; issued and outstanding
9,122,747 and 9,222,747 shares as of December 31, 2020 and 2019, respectively
Additional paid-in capital
Retained earnings
Accumulated other comprehensive income
Total stockholders’ equity
Total liabilities and stockholders’ equity
December 31, 2020
December 31, 2019
$
24,818,619
$
34,616,880
166,704,001
596,999,072
3,147,500
108,947,624
479,843,448
3,138,900
1,129,505,157
1,048,147,496
1,620,801
17,340,250
11,142,897
217,856
2,915,715
-
3,133,240
12,424,434
5,678,201
2,776,785
17,810,605
11,788,409
4,003,684
2,842,713
1,151,016
3,959,260
12,114,559
6,041,126
$
1,975,647,743
$
1,737,182,505
$
349,500,268
$
267,441,988
528,795,635
581,223,880
60,019,296
196,907,101
461,857,728
481,642,221
74,206,421
208,026,740
1,716,446,180
1,493,175,098
37,293,019
3,000,000
-
1,731,211
7,690,907
42,033,570
5,000,000
2,213,459
-
7,180,906
1,766,161,317
1,549,603,033
18,245,494
18,445,494
17,001,736
158,216,626
16,022,570
18,794,141
146,225,085
4,114,752
209,486,426
187,579,472
$
1,975,647,743
$
1,737,182,505
INTEREST AND DIVIDEND INCOME:
Loans, including fees
Securities
Taxable
Tax-exempt
Other interest and dividend income
Total interest and dividend income
INTEREST EXPENSE:
Deposits
Other borrowed funds
Total interest expense
Net interest income
Provision for loan losses
Net interest income after provision for loan losses
NON-INTEREST INCOME:
Wealth management income
Service fees
Securities gains, net
Gain on sale of loans held for sale
Merchant and card fees
Other non-interest income
Total non-interest income
NON-INTEREST EXPENSE:
Salaries and employee benefits
Data processing
Occupancy expenses, net
FDIC insurance assessments
Professional fees
Business development
Intangible asset amortization
New market tax credit projects amortization
Other operating expenses, net
Total non-interest expense
Income before income taxes
INCOME TAX EXPENSE
NET INCOME
Basic and diluted earnings per share
Declared dividends per share
December 31, 2020
December 31, 2019
$
50,469,873
$
44,282,197
7,763,684
3,628,123
1,078,967
62,940,647
7,820,828
276,982
8,097,810
54,842,837
5,680,656
49,162,181
3,848,497
1,523,189
429,925
2,111,893
1,772,469
934,164
10,620,137
6,483,893
4,047,054
1,364,349
56,177,493
10,200,626
728,723
10,929,349
45,248,144
1,314,104
43,934,040
3,596,770
1,619,269
17,031
1,044,798
1,525,309
826,221
8,629,398
22,868,601
19,675,952
5,181,705
2,667,788
313,069
1,537,254
1,081,537
826,020
638,851
1,436,430
36,551,255
23,231,063
4,381,000
18,850,063
2.06
0.75
$
$
$
$
$
$
4,130,506
2,275,882
193,593
1,753,531
1,242,271
609,624
581,563
1,058,747
31,521,669
21,041,769
3,847,600
17,194,169
1.86
0.96
10
2020 Annual Report | Ames National Corporation
Ames National Corporation | 2020 Annual Report
11
COMMUNITY INVOLVEMENT
Community Involvement is a guiding core
value for Ames National Corporation. Even
with all of the challenges of 2020, there were
so many examples of friends and neighbors
working to help in whatever way they were
able. As we take a moment to reflect on the
over 7,200 volunteer hours through nearly 200
organizations, it is inspiring to consider the
great things we can do as a community when
we unite our efforts.
Throughout 2020, we joined together as a team
to give our time and talents to support our
key areas of focus. Each affiliate community is
unique, and we encourage our employees to
find ways to help our customers and community
members live productive and enriched lives.
Volunteering and giving had to be approached
differently in 2020, but our team was flexible
and adjusted to new ways of getting involved.
Whether making and distributing masks
to encourage health and safety during the
pandemic or assisting with clean-up efforts after
the historic and devastating “derecho” that made
its way through Iowa, our employees didn’t miss
a beat in stepping up and getting involved.
Thank you to all employees, board members,
customers and local business partners for your
support in our efforts to make a difference in
the communities we serve. It is a privilege to
see the impact of our core values in action. Visit
www.amesnational.com for more details on our
commitment to Community.
AREAS OF SUPPORT
19 Locations serving 12 Communities
FINANCIAL LITERACY
AND EDUCATION
COMMUNITY AND
ECONOMIC DEVELOPMENT
HEALTH AND
HUMAN SERVICES
12
2020 Annual Report | Ames National Corporation
Ames National Corporation | 2020 Annual Report
13
BOARD OF DIRECTORS
SHAREHOLDER INFORMATION
BACK, LEFT TO RIGHT:
FRONT, LEFT TO RIGHT:
Patrick G. Hagan
Retired Senior Vice
President of Fareway
Stores, Inc.
David W. Benson
Partner, Nyemaster
Goode Attorneys at Law
Kevin L. Swartz
Retired Chief Executive
Officer, Wolfe Clinic PC
James R. Larson II
President, Larson
Development
Corporation
Thomas H. Pohlman
Chairman
John P. Nelson
President & CEO
Steven D. Forth Farmer
John L. Pierschbacher
Chief Financial Officer
MIDDLE, LEFT TO RIGHT:
Michelle R. Cassabaum
Chief Operating &
Financial Officer, 21st
Century Rehab
Betty A. Baudler Horras
President, Baudler
Enterprises, Inc.
Lisa M. Eslinger
Chief Financial and
Administrative Officer,
Iowa State University
Foundation
MANAGEMENT TEAM
John P. Nelson
President & CEO
John L. Pierschbacher
CFO
Timothy J. Lupardus
Senior Vice President & Chief Information Officer
Nicole J. Rasmussen
Vice President & Strategic Engagement Officer
Jennifer J. Hanson
Vice President & Human Resources Director
Tracy W. Laws
Vice President & Internal Auditor
Matthew R. Hackbart
Vice President of Information Technology
Joel P. Jacobsen
Vice President & Risk Management Officer
David A. Troe
Vice President & Valuation Officer
Wendy S. Current
Vice President & Training and Development Director
Justin C. Clausen
Controller
Marie I. Roberts
Accounting Specialist
Lori J. Hill
Valuation Services Coordinator & Administrative Officer
Douglas S.H. Kinsey
Information Technology Systems Admin II
Paul M. Crowe
Information Technology Systems Admin I
Tyler D. Nablo
Information Technology Support Analyst II
ANNUAL MEETING
The Board of Directors of Ames National Corporation has
established Wednesday, April 28, 2021, at 4:30 p.m. as the
date of the Annual Meeting of Shareholders.
The meeting will be held at First National Bank, 405
5th Street Ames, Iowa. Due to the continued public
health impact of the coronavirus pandemic (COVID-19),
recommendations and orders from federal and Iowa
authorities, and to support the health and well-being of
our shareholders, the Annual Meeting will also be available
through a virtual format. Shareholders are strongly
encouraged to participate virtually. To participate virtually,
visit the Ames National Corporation website, www.
amesnational.com, shortly before the meeting on April 28,
2021. Shareholders are encouraged to participate virtually
and to vote their shares in advance by proxy, as online
voting will not be available through the virtual format.
Shareholders may attend the meeting in person, but are
requested to notify the Company of their attendance in
advance to enable the Company to plan for and ensure
compliance with state and local ordinances relating to the
pandemic. Notification should be made by email, info@
amesnational.com or by calling 515-232-6251
PROFESSIONAL EXPERTS
External Auditor: CliftonLarsonAllen LLP
West Des Moines, Iowa
Counsel: Nyemaster Goode, P.C.
Des Moines, Iowa
MARKET MAKERS
Ames National Corporation’s common stock is listed on
the NASDAQ Capital Market under the symbol “ATLO.”
Market makers and brokers in the stock include:
First Point Wealth Management, First National Bank, Ames
(515) 663-3074
D.A. Davidson | (800) 755-7589
Raymond James | (800) 800-4693
STOCK TRANSFER AGENT
Continental Stock Transfer & Trust
17 Battery Place
New York, NY 10004
(212) 509-4000
www.continentalstock.com
FORM 10-K AND OTHER INFORMATION
A copy of the Company’s Annual Report to the Securities
and Exchange Commission on Form 10-K will be
available on the Securities and Exchange Commission’s
website at http://www.sec.gov and through a link on the
Company’s website, www.amesnational.com, at Financial
Information, SEC Filings on or about, March 12, 2021.
Additional information is also available by contacting
John L. Pierschbacher, CFO at 515-232-6251 or info@
amesnational.com.
14
2020 Annual Report | Ames National Corporation
Ames National Corporation | 2020 Annual Report
15
Ames National Corporation
P.O. Box 846 405 5th Street
Ames, IA 50010
(515) 232-6251 | Fax (515) 663-3033
info@amesnational.com | www.amesnational.com