Isabella Bank Corp.
Annual Report 2011

Plain-text annual report

A N N U A L R E P O R T 2 0 1 1 commitcareconnectAnnual Shareholder Meeting May 1, 2012 at 5:00 p.m. Comfort Inn & Conference Center 2424 S. Mission St., Mt. Pleasant 48858 Mission Statement To create an operating environment that will provide shareholders with sustained growth in their investment while maintaining our independence and subsidiaries' autonomy. Equal Employment Opportunity The equal employment opportunity clauses in Section 202 of the Executive Order 11246, as amended; 38 USC 4212, Vietnam Era Veterans Readjustment Act of 1974; Section 503 of the Rehabilitation Act of 1973, as amended; relative to equal employment opportunity and implementing rules and regulations of the Secretary of Labor are adhered to and supported by Isabella Bank Corporation and its subsidiaries. David J. Maness, Chairman Richard J. Barz, Chief Executive Officer On behalf of our Board of Directors, we are pleased to report another successful year for Isabella Bank Corporation. The financial industry has certainly faced challenges; however, we have found communicating the good news has been very important during times when so much of the attention in the media has been focused on the negative. We have a great story to tell and we have been working hard to share it with our communities. In 2011, we celebrated record earnings, strong dividends, and solid growth which have positioned us well for 2012. During 2011, we saw a 37% increase in the market price of our stock and celebrated the 30th consecutive year we increased cash dividends. The closing price of our stock on December 30, 2011 was $23.70 compared to $17.30 on December 31, 2010. While stock price is driven by the market and not something within our control, our financial performance can have a direct impact on the dividends we pay to our shareholders. In 2011, our cash dividends totaled $0.76 per share, a 5.6% increase from 2010. As shareholders, it is important that we continue to reward you while balancing the needs of our customers. And for many of you who are both a customer and a shareholder, you understand how important maintaining this balance is to our future. Strategic growth will be a key component to keeping the momentum of our success going forward. The word strategic is very important as it emphasizes the importance of having a solid plan. In other words, we will not sacrifice the very core values which have made us strong for the sake of growth. Our first priority is organic growth, or growing and deepening the number of relationships we have within our current communities. The other approach to growth involves expanding into new communities which fit within our market area and complement our culture as an organization. We look to our Investment and Trust Services Department to be a key driver of organic growth in the years ahead. For that reason, we integrated what used to be two separate departments into one in 2011. Promoting one team allows us to more easily reach out to our customers and employees, increasing awareness of our products and services in our communities. Together their services have the ability to add tremendous value to the financial and estate planning needs of our customers while creating additional revenue opportunities for the Bank. A discussion on growth would not be complete without an update on our newest office in Midland. It is hard to believe this office will celebrate its two year anniversary in August. Midland is a perfect example of strategic growth; the office is located within our footprint and in a community that complements our culture. At the end of 2011, our deposits had grown to over $16.3 million and our loans exceeded $6.0 million i o r f i t y " O u r r s t i s i o r p r o r g a n i c g r o w t h , g r o w i n g a n d d e e p e n i n g o f t h e n u m b e r i o n s h i p s t h i n r e n t i e s . " r e l a t w e h a v e w i c u r o u r t c o m m u n i for this location. We are pleased to report because of this growth, we were able to add a full-time mortgage lender to the Midland team for 2012. In the next year, we will also expand into the community of Freeland. We have purchased property on the corner of Meyers Street and M-47 with plans to begin construction later this spring. Employee development has an important role in our sustainability. Training has become a trademark for working at Isabella Bank; focusing both on personal as well as professional development. Our largest training initiative is our bank-wide customer service seminar which we hold annually. We view this seminar as an opportunity to reinvest in one of our most important assets, our employees. This training stresses the importance of personal development while continuing to build a culture of collaboration among our different branches and departments. At our 2012 seminar, we unveiled our new service vision, "Commit - Care - Connect". This vision articulates the true purpose of why our organization exists, putting into words the beliefs we have valued for over a century. We are committed to connecting our customers with the right products and services to meet their goals and we do this with care and integrity. Over the past few years, we have also made a very deliberate investment in leadership development. Approximately six years ago, we partnered with the distinguished Dale Carnegie training group to invest in the personal development of our employees. This twelve week program focused on taking leadership to the next level. Since then, we are pleased to report over 150 of our staff have graduated from this program. Executive development has been another key area of focus for us. In partnership with a professional executive development expert, we have two different groups going through an intense two year executive development program. As a result of this program, we have seen both professional and personal growth in these individuals. In addition, this development program will ensure that our senior staff is well prepared to lead this organization for many years to come. Keeping in the spirit of employee development, we would like to take time to recognize our annual officer promotions. These individuals exemplify the dedication it takes to uphold our values and we cannot thank them enough for their contributions. In June, Mr. Steven Pung was promoted to Executive Vice President and Mr. Jae Evans was promoted to Chief Operations Officer. We also welcomed Mr. Rich Russo to our team to serve as Greenville Division President. In December, Mr. Dan Eversole (Human Resources) and Mrs. Barb Place (Audit) were promoted to Senior Vice Presidents. Mrs. Carrie Smith (Mortgages) and Mrs. Erika Ross (Marketing) were promoted to Vice Presidents. Mrs. Freida Tilmann (Mortgages), Mr. Vern Houin (Technology), and Mrs. Shelley Hobbs (Midland Branch Manager) were promoted to Assistant Vice Presidents. We would also like to recognize Mrs. Dianne Morey who retired from our Board in 2011. As a local business owner herself, Dianne’s insight added tremendous value to our Board. She has also been a champion of our Bank in the community. Thank you Dianne for your many contributions to Isabella Bank. On behalf of our Board and employees, thank you for your support in 2011. We are very proud of our accomplishments; without your loyalty and trust our success would not be possible. We look forward to seeing you at our annual shareholder meeting on May 1, 2012 at the Mt. Pleasant Comfort Inn and Conference Center at 5:00 p.m. F r e e l a n d O f f i c e S c h e d u l e d t o o p e n F a l l 2 0 1 2 Dennis P. Angner, President & Chief Financial Officer 2011 Financial Highlights & Industry Trends ▪ Record net income of $10.21 million ▪ Record earnings per share of $1.35, a 12.50% increase ▪ Assets at year end 2011 of $1.34 billion, a 9.15% increase over 2010 ▪ Deposit growth of 9.21% In 2011, our net income was $10.21 million, an increase of $1.17 million when compared to year-end 2010. Over the past two years, our net income has increased $2.41 million, or 30.90%, while earnings per share have increased $0.31. Loan quality continues to be an important factor in determining financial performance. Our loan quality remains strong as evidenced by our low percentage of loans classified as nonperforming. As of December 31, 2011, our ratio of nonperforming loans to total loans was 0.95% compared to 2.95% for our peer group. In 2011, our net charged-off loans totaled $3.82 million, and while this number is well below the state and national averages, it is still well above our historical levels. (The average percentage of charged-off loans to total loans from 2000 to 2007 was 0.14% versus 0.51% in 2011.) In 2011, new regulations introduced in the Dodd- Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) moved into our everyday operations at the Bank. These rules have impacted staffing requirements, compliance costs, and overall profitability. The recent addition of an entirely new department responsible for certain requirements under these new rules is one example of how these regulations affected staffing. This department’s responsibility is to perform a review of all commercial and residential appraisals done by third party providers to determine if they meet industry standards. These new regulations take a substantial time commitment from our team. In addition to meeting our regulatory requirements, we also need to understand how these rules affect our customers and take the necessary steps to minimize any inconvenience they may experience. Since December 2008, market interest rates have been at record lows. In a recent announcement, the general consensus among the Federal Reserve Board of Governors is there will be no significant change in interest rate levels until late 2014. Clearly, interest rates at these extremely low levels have resulted in subsidizing borrowers at the expense of savers. For many financial institutions, including Isabella Bank Corporation, historically low interest rates coupled with weakened loan demand have created new challenges. Over the past three years, the total balance of outstanding loans has declined on a state and national level. During this time, our total assets grew by $198.66 million, with loan growth accounting for $26.98 million and investments $170.52 million. While our loan growth has been less than we would have liked, we are extremely fortunate to still show growth. The challenge in this scenario becomes deploying deposit dollars from higher paying loans to lower yielding investments. Managing interest rate risk during this low rate environment is another trial facing the entire banking industry. Interest rate risk is created when our assets (loans) re-price at different speeds and time frames than our liabilities (deposits). For example, in the current environment borrowers want fixed rates for the longest term possible, while savers generally opt for short term or liquid deposit products. There is an old adage in banking, there is no such thing as a fixed rate loan in a falling interest rate environment (many people will want to refinance). Conversely, in a rising rate environment, there is no such thing as a fixed rate certificate of deposit (many customers are willing to pay the penalty to get a higher rate). When interest rates increase, our deposits re-price at higher rates, and faster than our loans. To manage this risk, we have been borrowing long term fixed rate funds from the Federal Home Loan Bank. While this strategy has decreased our current net interest yields, it provides long term protection against interest rate risk. Despite the challenges mentioned above, we continue to be profitable; 2011 was a record setting year for net income. We are proud to be a community bank; we understand the value of being a locally owned and operated business in our communities, and we look forward to maintaining our independence into the foreseeable future. Peer Group Comparison We subscribe to reports that compare the financial performance of Isabella Bank Corporation to other bank holding companies in the United States who are similar in size ($1.0 billion-$3.0 billion in assets). In all, there are 303 bank holding companies in our peer group. There are several key ratios that we use to monitor the strength and soundness of Isabella Bank Corporation: (1) Return on Assets; (2) Risked Based Capital to Risk Weighted Assets; (3) Problem Loans; and (4) Allowance for Bad Debt to Problem Loans. Return on Assets (ROA) Isabella Bank Corporation 0.79% Peer Group 0.62% Problem Loans (Nonperforming) Isabella Bank Corporation 0.95% Peer Group 2.95% ROA measures net income by the average asset size of the bank holding company. Our ROA in 2011 exceeded the peer group by 0.17%. Risk Based Capital to Risk Weighted Assets Isabella Bank Corporation 14.17% Peer Group 15.43% This measures the amount of capital held against risk based assets. The Corporation's ratio of 14.17% is strong when compared to the required ratio of 10.0% necessary to be considered adequately capitalized under the Federal Reserve Board's risk based capital rules. The Corporation continues to be profitable, well capitalized and has funds available to meet its customers' borrowing needs. Problem Loans measures the percent of loans that are over 90 days past due and still accruing or placed in non-accrual because collection is doubtful. Our total problem loans (as a percentage of loans) is 0.95% compared to 2.95% for our peer group. The peer group average is over three times higher than Isabella Bank Corporation. Allowance for Bad Debt to Problem Loans Isabella Bank Corporation 173.03% Peer Group 100.52% Allowance for Bad Debt to Problem Loans measures the amount of reserves needed for possible loan losses. We have $1.73 in reserves for every $1.00 of nonperforming loans. Results as of December 31, 2011 Income Statement Data Total Interest Income Net Interest Income Provision for Loans Losses Net Income Balance Sheet Data End of Year Assets Daily Average Assets Daily Average Deposits Daily Average Loans/Net Daily Average Equity Per Share Data Earnings Per Share Basic Diluted Cash Dividends Book Value (Year End) Market Value (Year End) Financial Ratios Shareholders' Equity to Assets (Year End) Return on Average Equity Return on Average Tangible Equity Cash Dividend Payout to Net Income Return on Average Assets (Dollars in thousands except per share data) 2011 $ 57,905 $ 41,702 $ 3,826 $ 10,210 $ 1,337,925 $ 1,287,195 $ 927,186 $ 730,919 $ 145,725 $ 1.35 $ 1.31 $ 0.76 $ 20.40 $ 23.70 11.57% 7.01% 10.30% 56.51% 0.79% 2010 $ 57,217 $ 40,013 $ 4,857 $ 9,045 $ 1,225,810 $ 1,182,930 $ 840,392 $ 712,272 $ 139,855 $ 1.20 $ 1.17 $ 0.72 $ 19.23 $ 17.30 11.84% 6.47% 9.55% 59.93% 0.76% 2009 $ 58,105 $ 38,266 $ 6,093 $ 7,800 $ 1,143,944 $ 1,127,634 $ 786,714 $ 712,965 $ 139,810 $ 1.04 $ 1.01 $ 0.70 $ 18.69 $ 18.95 12.31% 5.58% 8.53% 67.40% 0.69% 2008 $ 61,385 $ 35,779 $ 9,500 $ 4,101 $ 1,139,263 $ 1,113,102 $ 817,041 $ 708,434 $ 143,626 $ 0.55 $ 0.53 $ 0.65 $ 17.89 $ 25.50 11.80% 2.86% 4.41% 118.82% 0.37% 2007 $ 53,972 $ 28,013 $ 1,211 $ 7,930 $ 957,282 $ 925,631 $ 727,762 $ 596,739 $ 119,246 $ 1.14 $ 1.11 $ 0.62 $ 17.58 $ 40.00 12.86% 6.65% 8.54% 54.27% 0.86% 1,400 1,200 1,000 800 600 400 200 ) s n o i l l i M - s r a l l o D ( 10,000 9,000 8,000 7,000 6,000 5,000 4,000 ) s d n a s u o h T - s r a l l o D ( Total Assets Dividends Per Share 0.7 0.6 0.5 0.4 0.3 0.2 0.1 ) s r a l l o D ( 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Net Income Ending Stock Price ) s r a l l o D ( 40 35 30 25 20 15 10 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 l i g h t B u s i n e s s S p o t In 2011, we experienced growth and record net income. We also celebrated 30 consecutive years of increased cash dividends. Our story is not uncommon in our communities. There are many other businesses right in our backyard who are taking on these economic challenges, turning them into opportunities, and succeeding. We would like to share with you a few of these stories. Business Spotlight Sherwood Farms St. Louis, MI Cash crop farming has been part of the Sherwood family for three generations. Originally started north of Wheeler by Lyle Sherwood, he then moved his operations to the present location west of Breckenridge. His son, Arland, became involved in the farm, later mentoring and passing along the business to his sons, Al and Jeff. They currently own Sherwood Farms, with Arland helping at planting and harvesting time. Over the past thirty years, farming has seen its share of changes, both in the competitive market and in technology. Pricing which was once dependent on the weather conditions and demand locally, is now influenced by factors internationally, as well as the Chicago commodities market. Technological advances, such as equipment with built-in GPS, have created efficiencies, minimizing waste and allowing the Sherwoods to effectively manage an operation spread over 3,200 acres. Strategic planning has played a key role in the success of Sherwood Farms. While many may think cash crop farming is seasonal, Al and Jeff are busy year-round planning for the future. They are able to utilize the tools available today to make decisions about when to purchase supplies and sell crops. The unpredictability of farming also makes planning for the challenging years important. Saving money during the good years, doing their own repairs, not financially overextending themselves, and protecting their business using crop insurance have all been strategies used by the Sherwoods to make this multi-generation farm successful. Why Bank with a Community Bank? "It is good for the community to work with the community. Isabella Bank has always taken care of us and we have confidence in them." commitKyle's Manufacturing Farwell, MI In 1996, what began as an idea for manufacturing valves has grown today into a successful business located in Farwell. While the sheer cost of starting a manufacturing business may have deterred many entrepreneurs from taking this idea further, Dave Kyle was determined to turn his vision into reality. With years of manufacturing experience and encouragement from others in the industry, Dave wrote the initial business plan for Kyle's Manufacturing. Success for this northern Michigan business was built upon their perseverance, product integrity, and community support. Kyle's Manufacturing has created a competitive edge in the market through their attention to detail and ability to deliver on promises. These are both qualities that drive customer loyalty, a cornerstone of the company's brand. Technology has been embraced by the company in order to produce quality products while improving efficiencies. As a result of these strategies, they have outgrown their original building, their two machines have become 17, and the company employs 10 people. Why Bank with a Community Bank? "Isabella Bank is like working with family. They treat you like family." careCasair, Inc. Stanton, MI In rural communities, internet access is not always available to families and businesses. This has created many challenges not only for those wishing to get access at home but also for the businesses which rely upon electronic communication for their day-to-day operations. Steve Meinhardt saw this need as a great opportunity for his business, Casair, to assist the community. His business, originally located in his father’s garage, began with computer programing and since then has grown rapidly, expanding their services, and now employing 22 people. In addition to internet services, Casair provides network security, business IT support, hosting services and computer repair. In the technology industry, changes happen continuously and staying ahead of the curve is essential for the survival of any business. One of Casair’s key strategies for success has been to reinvest profits back into their business. By doing so, they have enhanced their services and expanded their coverage area. Their commitment to continuously improve their services shows their dedication to providing their customers with a positive experience. They recognize their business is as much about providing the support surrounding the service as it is about providing the service itself. In other words, their value as a company is dependent upon having the support available to customers when they have questions. Just as Steve recognized the opportunity to bring internet services to his community, he continues to look for other opportunities. This is another key ingredient to their success. In 2010, Casair began a $26 million expansion project in order to provide high speed broadband services to the underserved areas of Mecosta, Montcalm, Gratiot and Northern Ionia counties. As a result of this project, the company anticipates adding 30 more employees. Why Bank with a Community Bank? "Isabella Bank was willing to cater to the unique needs of our high capital needs business. Isabella Bank provides the perfect balance of the advanced technology of a national bank along with the personal touch and local convenience of a community bank." Northwind Investments Mt. Pleasant, MI In the highly competitive fast food industry, business owners must find a way to differentiate themselves from other restaurants and grocery stores in order to be successful. With a travel center (convenience store/gas station/truck stop), nine Qdoba restaurants and 24 Burger King locations throughout Mid and Northern Michigan, Northwind Investments has accomplished this through their top-line management style, dedication to customer service and product diversification. Owners Greg Johnroe, Norm Spalding, Bob Spalding, and Kevin Egnatuk use a top-line management strategy which focuses on delivering exceptional customer service and building brand awareness throughout their communities (a bottom-line strategy centers the decision making process purely around profit). Northwind’s dedication to customer service is part of their culture and is valued by their 900+ employees throughout their 33 locations. This culture of service excellence has led them to be recognized by Qdoba Corporation on eight different occasions for their success. In addition, their Mt. Pleasant location received an award during their grand opening in 2007 for the highest first week’s sales volume for any Qdoba restaurant up to that time. Northwind's success can also be attributed to their ability to look into the future to uncover opportunities. Despite the challenges in the economy, they have taken this opportunity to diversify their business, adding three new locations and looking at the addition of new food offerings to meet the changing needs and expectations of their customers. Why Bank with a Community Bank? “The large regional and national banks look at companies like us, and try to find a way to fit us into one of their “boxes” for services and loan relationships. Isabella Bank comes to us with the attitude of “How can we help you ?” and then finds ways to adapt to our needs. It is such a refreshing way to do business." connectDoyle Forest Products, Inc. Paris, MI John Doyle originally started Doyle Forest Products fifty-five years ago and has since passed the business along to his son, Joe. The company provides timber removal services in and around Paris, Michigan (45 mile radius) and employs 18 people. When the business began, there were many competitors in the industry and today, the consolidation of large mills has added new challenges. Over the years, the Doyles’ ability to effectively locate timber, differentiate their service, and market their product for resale have all been keys to their success. When it comes to locating timber, the Doyles’ commitment to customer satisfaction and service differentiation keeps business in the pipeline well into the future. Most of their business comes from the positive word of mouth experiences from their customers, and they rely very little on advertising. The Doyles take great pride in leaving a job site clean for their customers and have invested in the sophisticated equipment needed to be efficient with their time while minimizing waste. During tough economies, forestry companies have not always been able to market their products. While the Doyles have seen their fair share of challenges, their strong relationships with others in the industry have had a substantial impact on their success. Their willingness to complete custom projects when no one else would, helped build Doyle Forest Products' reputation for being flexible and dependable. What resulted from these close relationships was a network of local businesses who worked together to adapt and be successful despite tough times. Why Bank with a Community Bank? "Isabella Bank has worked very hard to understand our business and to anticipate our needs. They have structured their services well, and I really appreciate their ability and willingness to participate in our long term planning." Board of Directors DAVID J. MANESS - Chairman President, Maness Petroleum Corporation RICHARD J. BARZ Chief Executive Officer, Isabella Bank Corporation DENNIS P. ANGNER President and Chief Financial Officer, Isabella Bank Corporation JEFFREY J. BARNES, MD Physician and Co-Owner, Central Eye Consultants SANDRA L. CAUL State Representative (retired) JAMES C. FABIANO Chairman & Chief Executive Officer, Fabiano Brothers, Inc. G. CHARLES HUBSCHER President, Hubscher and Son, Inc. JOSEPH LaFRAMBOISE Sales and Marketing Executive, Ford Motor Company (retired) THOMAS L. KLEINHARDT President, McGuire Chevrolet W. JOSEPH MANIFOLD, CPA Chief Financial Officer, Federal Broach & Machine Co. W. MICHAEL McGUIRE Director of the Office of the Corporate Secretary, The Dow Chemical Company DALE D. WEBURG President, Weburg Farms, Inc. David J. Maness Richard J. Barz Dennis P. Angner Jeffrey J. Barnes, MD Sandra L. Caul James C. Fabiano G. Charles Hubscher Joseph LaFramboise Thomas L. Kleinhardt W. Joseph Manifold, CPA W. Michael McGuire Dale D. Weburg Isabella Bank Corporation Officers RICHARD J. BARZ Chief Executive Officer DENNIS P. ANGNER President and Chief Financial Officer BARBARA A. PLACE, CPA Senior Vice President PEGGY L. WHEELER Senior Vice President CYNTHIA J. DIEHM Vice President GREGORY S. MAPES Vice President PATRICIA A. PLAXTON Vice President AMY C. VOGEL Vice President Isabella Bank Officers RICHARD J. BARZ President and Chief Executive Officer STEVEN D. PUNG Executive Vice President JAE A. EVANS Chief Operations Officer DAVID J. REETZ Chief Lending Officer BARBARA B. DIEHM Senior Vice President DANIEL E. EVERSOLE Senior Vice President JAMES L. BINDER Vice President JULIE F. BOLT Vice President RANDY J. DICKINSON, CPA Vice President DAVID D. GILLESPIE Vice President MICHAEL K. HUENEMANN Vice President ROBERT K. MADSEN Vice President ERIKA M. ROSS Vice President PAUL C. SIERS Vice President CARRIE S. SMITH Vice President JEFFREY W. SMITH Vice President JONATHAN J. WAINWRIGHT Vice President PEGGY L. WHEELER Vice President LEO R. WICKERT Vice President Breckenridge Division Board of Directors DALE D. WEBURG - Chairman DENNIS P. ANGNER RICHARD J. BARZ DAVID J. KING WILSON C. LAUER TIMOTHY M. MILLER KIRK L. SMITH GREGORY V. VARNER Breckenridge Division Officers TIMOTHY M. MILLER President BRIAN K. GOWARD Vice President KENNETH L. HOWELL Vice President BARBARA K. McKENZIE Vice President JOHN D. RIVETT Vice President Farwell Division Board of Directors HERBERT R. MILLER - Chairman DENNIS P. ANGNER RICHARD J. BARZ THOMAS E. KEDROWSKI THOMAS L. KLEINHARDT W. MICHAEL McGUIRE LARRY R. SCHOFIELD THOMAS J. WALLACE Farwell Division Officers THOMAS J. WALLACE President MELODY M. DARNELL Vice President TIMOTHY M. WILSON Division Senior Lender Greenville Division Board of Directors LEALAND T. WALLIN - Chairman DENNIS P. ANGNER RICHARD J. BARZ KIRKWOOD E. FABER, DDS DEBRA JORGENSEN-HUCH ALEXANDER R. KEMP GREGORY D. MILLARD JAMES M. MULLENDORE, Jr. RICHARD K. RUSSO Greenville Division Officers RICHARD K. RUSSO President KATHY J. KORSON Vice President DAVID W. SEPPALA Vice President Mecosta Division Board of Directors RICHARD J. BARZ Dr. RALPH P. CREW LAWRENCE E. EMIG KEVIN J. DEFEVER JOSEPH LaFRAMBOISE JEROME E. SCHWIND Mecosta Division Officers JEROME E. SCHWIND President Financial Group Information Services Board of Directors DALE D. WEBURG - Chairman DENNIS P. ANGNER RICHARD J. BARZ JAE A. EVANS THOMAS L. KLEINHARDT JOSEPH LaFRAMBOISE W. MICHAEL McGUIRE DAVID J. MANESS TIMOTHY M. MILLER STEVEN D. PUNG JONATHAN J. WAINWRIGHT Financial Group Information Services Officers JONATHAN J. WAINWRIGHT President JULIE A. HUBER Vice President Board of Directors and Senior Officers as of March 2012 Investor Relations For More Information, Contact Debra Campbell (989) 779-6237 │ 401 N. Main St., Mt. Pleasant, MI 48558 or visit www.isabellabank.com ► Investors Stock Information Isabella Bank Corporation common stock is traded under the symbol ISBA on the OTCQB Tier of the OTC Markets Group, Inc.’s electronic quotation system. Current stock price and availability can be obtained by contacting a licensed broker or through the Investment and Trust Services Department at Isabella Bank. To learn more about Isabella Bank Corporation, visit the Investors tab at www.isabellabank.com or contact Investor Relations. Isabella Bank Corporation │ 401 N. Main Street │ Mt. Pleasant, MI 48858 

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