More annual reports from County Bancorp, Inc.:
2021 ReportShaping the future together ANNUAL REPORT 2018 Shaping the future together 2018 brought a record profit for your company at $14.3 million. We are very pleased to report this, but, as you may know, we also have been ex- periencing an extended low commodity price environment, which has made it difficult for many of our agricul- tural customers. The challenges in the ag sector have been well documented in the media over the past number of months. We continue to work with these clients to as- sist where we can and help them through this challenging time. We are hopeful that if the United States can finalize a trade deal with China (fingers crossed this has occurred by the time you are reading this) and we finalize the new Mexico Canada Trade Agreement (formerly NAFTA), we will see some relief for our farmers. If the trade agreements do not come to fruition, we will continue to manage through this cycle. In addition to our record earnings in 2018, we also saw very solid core deposit growth of nearly $70 million. Our core deposit focus was strong in 2018 and will be even stronger in 2019, as we continue to change the composition of our funding more toward core and less on wholesale sources. This is a strategic shift that will position us well for the future. Along with this, we are managing our on- balance sheet loan growth in 2019 to allow the deposit composition shift to occur. In 2018, we grew $58.3 million in on-balance sheet loans, which was a mix of agricultural and commer- cial loans. Our gross loans serviced increased $119.4 million during 2018. Gross loans would include the on-balance sheet loans as well as participated loans and Government Guaranteed loans sold into the secondary market. As you can see from these two numbers, approximately half of our total loan originations during 2018 were either participated or sold, to manage our on-balance sheet loan growth. With the continued low commodity price envi- ronment, this has placed strain on a number of our borrowers and has elevated our non-per- forming asset levels and classified assets. We are managing both of these with great focus, but until we see commodity prices improve we don’t see these levels improving. We are well capitalized as an organization and structure the majority of our agricultural relationships with continued William Censky Chairman of the Board County Bancorp, Inc. Timothy Schneider President, County Bancorp, Inc.; CEO, Investors Community Bank 1 Shaping the future together Shaping the future together some form of a Farm Service Agency (FSA) Government guarantee. The broad use of the FSA guarantee program is a strong risk miti- gant to loan loss exposure. Recently announced through the new Farm Bill, the FSA guarantee limits have been increased by approximately $325,000, which will allow us to further reduce loan loss exposure on many of our relationships. Here are some additional bank highlights from 2018: Talent: In 2018, we continued to add talent to our team in many positions and locations, including our new Chief Credit Officer, John Fillingim. A Florida native, John joined ICB with more than 30 years of experience in com- mercial and agricultural banking, most recently as a senior executive at Synovus Bank. Overall we have a great team of people committed to the strategic direction we have set for long-term success. Your company has always been focused on Soundness, Profitability and Growth, in that order. Technology: We continue to research and implement banking technology that helps enhance customer access to services and simplify banking. In 2018, this included new programs such as mobile banking for consumers and businesses, mobile deposit capture, person-to-person payments, Card Valet fraud protection, and more. We are excit- ed to launch online account opening, customer chat, and other new customer-focused technol- ogies in 2019. last summer. We now occupy the former Manitowoc Company world headquarters building at 2400 S. 44th Street in Manitowoc. The new site is a perfect fit for our employees and space needs. Additionally, we have purchased land just off of I-41 in the Appleton area, near Navi- tus and Meijer. The bank plans on constructing a new banking center and moving its existing Appleton branch there sometime in the future. Facilities: Our bank and holding company corporate headquarters moved to a new home As always we appreciate your support as share- holders, and if you have any questions feel free to reach out any time. William Censky Tim Schneider 2 Directors, Advisory Board & ICB Officers Senior Management of County Bancorp, Inc. William C. Censky, Chairman of the Board Timothy J. Schneider, President Glen L. Stiteley, Chief Financial Officer and Treasurer Mark A. Miller, Secretary and Securities Compliance Officer Board of Directors* County Bancorp, Inc. / Investors Community Bank Mark R. Binversie, Investors Community Bank William C. Censky, Investors Community Bank Lynn D. Davis, Ph.D., Nutrition Professionals, Inc. Edson P. Foster, Foster Needle Co., Inc. (Retired) Vicki L. Leinbach, Ariens Company Robert E. Matzke, Financial Services of Northeast Wisconsin Wayne D. Mueller, Investors Community Bank Patrick J. Roe, First Community Financial Partners, Inc. (Retired) Timothy J. Schneider, Investors Community Bank Kathi P. Seifert, Katapult, LLC Andrew J. Steimle, Steimle Birschbach LLC Gary J. Ziegelbauer, Triangle Distributing, Inc. Stevens Point Advisory Board E. John Buzza, Buzza Dreier & Johnson LLC Ted Hesemann, Herrschners, Inc. Richard Okray, Okray Family Farms, Inc. Daniel J. Bukowski Sr., Net Alpha Advisers LLC Bill Mullins, Mullins Cheese, Inc. Ken Turzinski, TYRI Americas *As of 2/1/19 Investors Community Bank Officers Trever J. Athorp Nicole M. Bahn Tony J. Betley Mark R. Binversie Julie Blaha William C. Censky David A. Coggins William C. Deppiesse Thomas D. Detienne David J. Diedrich John R. Fillingim Steven J. Fleming Jennifer L. Foote Curtis L. Gerrits Jeffrey J. Hebert William C. Hodgkiss Brian J. Hoskens Michael J. Hostak Jeffrey L. Jagodinsky Matthew K. Kasdorf David D. Kohlmeyer Cari A. Larsen Matthew R. Lemke Mark D. Ludtke Mark C. Maurer Timothy S. McTigue Lori A. Megow Mark A. Miller Thomas J. Pennings Renee A. Petersen Sarah E. Peterson Sandra M. Retzki JoAnn M. Rutta Christopher J. Schneider Timothy J. Schneider Scott V. Schroeter Robert A. Seal Roger P. Sinkula Sharon A. Slager James J. Smidel Brooke R. Sprang Katelin R. Steege Mark J. Sterr Glen L. Stiteley Debbie L. Suettinger Barb J. Wege Laura A. Wiegert Cyrene N. Wilke Susan M. Van De Hey Vice President – Ag & Business Banking Officer Vice President – Senior Special Assets Officer Vice President – Sr. Ag Banking Officer President Sr. Banking Services Support Specialist | Security Officer Chairman of the Board Executive Vice President – Chief Banking Officer Vice President – Sr. Business Banking Officer Vice President – Market President – SE Region Vice President – Sr. Business Banking Officer Executive Vice President – Chief Credit Officer Vice President – Ag Banking Officer Vice President – Compliance Officer | CRA Officer Assistant Vice President – Ag Banking Officer Bank Systems Manager Senior Vice President – Business Banking Vice President – Sr. Ag Banking Officer Vice President – Information Technology Vice President – Business Banking Officer Senior Vice President - Deputy Chief Credit Officer Senior Vice President – Finance Vice President – Controller Senior Vice President – Banking Services Assistant Vice President – Ag Banking Officer Vice President – Sr. Business Banking Officer Senior Vice President – Agricultural Banking Assistant Vice President – Banking Services Manager Executive Vice President – Chief Risk Officer & Bank Counsel / Secretary Vice President – Sr. Business Banking Officer Assistant Vice President – Electronic Banking Manager Vice President – Credit Administration Manager Vice President – Sr. Business Banking Officer Assistant Vice President – Banking Services Manager Vice President – Sr. Ag Banking Officer Chief Executive Officer Assistant Vice President - Ag Banking Officer Assistant Vice President – Business Banking Officer Assistant Vice President – Ag Banking Officer Assistant Vice President – Governmental Guarantee Loan Program Assistant Vice President – Ag Banking Officer Vice President – Human Resources Assistant Vice President – Credit Manager – Ag Vice President – Sr. Business Banking Officer Executive Vice President – Chief Financial Officer / Treasurer Assistant Vice President – Sr. Benefits & Compensation Specialist Assistant Vice President – Banking Services Manager Senior Vice President – Marketing Senior Vice President – Operations Assistant Vice President – Loan Operations Manager 3 Selected Income Statement Data: Interest income Interest expense Net interest income Provision for loan losses Net interest income after provision for loan losses Non-interest income Non-interest expense Income tax expense Net income Per Common Share Data: Basic Diluted Cash dividends per common share Book value per share Tangible book value per share** Weighted average common shares - basic Weighted average common shares - diluted Common shares outstanding, end of period Performance Ratios: Return on average assets Return on average common shareholders’ equity** Equity to assets ratio Net interest margin Interest rate spread Non-interest income to average assets Non-interest expense to average assets Net overhead ratio Efficiency ratio** Dividend payout ratio Asset Quality Ratios: Nonperforming loans to total loans Allowance for loan losses to: Total loans Nonperforming loans Net charge-offs to average loans Nonperforming assets to total assets Capital Ratios: Shareholders’ common equity to assets Total risk-based capital Leverage ratio Tangible common equity to tangible assets** As of and for the year ended December 31 2018 _ 2017 (Dollars in thousands except per share data) $64,217 22,262 41,955 3,195 38,760 8,833 28,283 5,059 $14,251 $2.06 $2.04 $0.28 $21.48 $20.65 6,704,051 6,772,927 6,709,480 0.96% 9.50% 10.00% 2.91% 2.64% 0.60% 1.91% 1.31% 54.42% 13.73% 1.90% 1.37% 71.81% (0.01)% 1.94% 9.47% 15.35% 12.44% 9.14% $53,052 14,167 38,885 2,330 36,555 7,653 25,992 7,791 $10,425 $1.52 $1.49 $0.24 $19.93 $19.04 6,635,383 6,746,846 6,673,381 0.80% 7.77% 10.09% 3.11% 2.89% 0.59% 2.01% 1.42% 54.63% 16.11% 1.01% 1.15% 114.60% 0.16% 1.15% 9.52% 12.79% 10.76% 9.13% 4 * s t h g i l h g H i i l a i c n a n F d e t c e e S l I I I S E R A D S B U S D N A . C N I , P R O C N A B Y T N U O C ) d e t i d u a n U ( 7 1 0 2 d n a 8 1 0 2 , 1 3 r e b m e c e D *Additional financial information is available upon request or can be viewed at InvestorsCommunity- Bank.com (click on Investor Relations icon). **This is a non-GAAP measure. Refer to our Form 10-K filed with the SEC on March 14, 2019 for a reconciliation to the most comparable GAAP measurement. s t e e h S e c n a l a B d e t a d i l o s n o C I I I S E R A D S B U S D N A . C N I , P R O C N A B Y T N U O C ) d e t i d u a n U ( 7 1 0 2 d n a 8 1 0 2 , 1 3 r e b m e c e D ASSETS Cash and cash equivalents Securities available for sale, at fair value FHLB stock, at cost Loans held for sale Loans, net of allowance for loan losses of $16,505 as of December 31, 2018; $13,247 as of December 31, 2017 Premises and equipment, net Loan servicing rights Other real estate owned, net Cash surrender value of bank owned life insurance Deferred tax asset, net Goodwill Core deposit intangible, net of amortization of $1,288 as of December 31, 2018; $882 as of December 31, 2017 Accrued interest receivable and other assets Total assets LIABILITIES Deposits: Noninterest-bearing Interest-bearing Total deposits Other borrowings Advances from FHLB Subordinated debentures Accrued interest payable and other liabilities Total liabilities SHAREHOLDERS’ EQUITY As of December 31 2018 2017 (Dollars in thousands except per share data) $61,087 195,945 2,978 2,949 1,190,790 16,075 9,047 6,568 17,842 4,346 5,038 513 7,849 $ 1,521,027 $121,436 1,101,911 1,223,347 827 89,400 44,703 10,466 1,368,743 $66,771 126,030 4,138 6,575 1,135,704 9,662 8,950 4,962 17,389 3,265 5,038 919 7,642 $ 1,397,045 $125,584 984,493 1,110,077 1,299 121,500 15,523 7,660 1,256,059 Preferred stock-variable rate, non-cumulative, nonparticipating, $1,000 stated value; 15,000 shares authorized; 8,000 shares issued Common stock - $0.01 par value; 50,000,000 authorized; 7,153,174 shares issued and 6,709,480 shares outstanding as of December 31, 2018; 7,112,962 shares issued and 6,672,381 shares outstanding as of December 31, 2017 Surplus Retained earnings Treasury stock, at cost, 443,694 and 439,581 shares at December 31, 2018 and 2017, respectively Accumulated other comprehensive loss Total shareholders’ equity Total liabilities and shareholders’ equity 8,000 8,000 28 53,162 98,475 (5,030) (2,351) 152,284 $1,521,027 28 52,230 86,385 (5,030) (627) 140,986 $1,397,045 5 For the year ended December 31 2018 2017 (Dollars in thousands except per share data) INTEREST AND DIVIDEND INCOME Loans, including fees Taxable securities Tax-exempt securities Federal funds sold and other Total interest and dividend income INTEREST EXPENSE Deposits FHLB advances and other borrowings Subordinated debentures Total interest expense Net interest income Provision for loan losses Net interest income after provision for loan losses NON-INTEREST INCOME Services charges Gain on sale of loans, net Loan servicing fees Other Total non-interest income NON-INTEREST EXPENSE Employee compensation and benefits Occupancy Write-down of other real estate owned Other Total non-interest expense Income before income taxes Income tax expense NET INCOME NET INCOME PER SHARE Basic Diluted Dividends paid per share $58,706 3,727 698 1,086 64,217 18,649 1,809 1,804 22,262 41,955 3,195 38,760 1,674 172 6,110 877 8,833 16,785 1,059 873 9,566 28,283 19,310 5,059 $14,251 $2.06 $2.04 $0.28 $50,395 1,808 350 499 53,052 11,815 1,837 515 14,167 38,885 2,330 36,555 1,406 118 5,484 645 7,653 15,437 654 905 8,996 25,992 18,216 7,791 $10,425 $1.52 $1.49 $0.24 ) d e t i d u a n U ( 7 1 0 2 d n a 8 1 0 2 , 1 3 r e b m e c e D d e d n e s r a e y e h t r o F 6 I I I S E R A D S B U S D N A . C N I , P R O C N A B Y T N U O C s n o i t a r e p O f o s t n e m e t a t S d e t a d i l o s n o C Shaping the future together Annual Meeting Tuesday, May 21, 2019, 6 PM at the Franciscan Center for Music Education and Performance at Silver Lake College, 2406 S. Alverno Rd., Manitowoc Corporate Headquarters 2400 S. 44th St., PO Box 700, Manitowoc WI 54221-0700, (920) 686-9998, 1-888-686-9998 Transfer Agent First Illinois Shareholder Services, 225 N. Water St., Decatur, IL 62523, 1-888-740-5512 Stock Listing History Performance County Bancorp, Inc. common stock is traded on the NASDAQ Global Market under the symbol “ICBK.” Shareholder website www.ICBK.com (click on Investor Relations icon) Investor Relations Shareholders, analysts, the news media and others desiring general information about the company or its subsidiaries may contact Glen Stiteley, CFO, at (920) 686-5658 or gstiteley@ICBK.com. Growth Since Inception We initially raised capital at a split adjusted $1.60 per share in 1996 $25 $20 $15 $10 $5 $0 l e r a h S r e P e u a V k o o B e b g n a T i l www.ICBK.com This report includes “forward-looking statements.” Forward-looking statements are subject to known and unknown risks and uncertainties, many of which may be beyond our control. We caution you that the for- ward-looking information presented in this document is not a guarantee of future events, and that actual events may differ materially from those made in or suggested by the for- ward-looking information contained here. In addition, forward-looking statements generally can be identified by the use of forward-look- ing terminology such as “may,” “plan,” “seek,” “comfortable with,” “will,” “expect,” “intend,” “estimate,” “anticipate,” “believe,” “continue” or the negative thereof or variations thereon or similar terminology. Factors that may cause actual results to differ materially from those made or suggested by the forward-looking statements contained herein include those identified in County Bancorp, Inc.’s most recent annual report on Form 10-K and other filings with the Securities and Exchange Commission. Any forward-looking information presented herein is made only as of the date of publica- tion of this annual report, and we do not un- dertake any obligation to update or revise any forward-looking information to reflect changes in assumptions, the occurrence of unanticipat- ed events or otherwise. 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Member FDIC Member FDIC 1
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