Park National Corp.
Annual Report 2019

Plain-text annual report

2019 Annual Report FAIRFIELD FAIRFIELD FAIRFIELD FAIRFIELD FAIRFIELD NATIONAL NATIONAL NATIONAL NATIONAL NATIONAL BANK BANK BANK BANK BANK DIVISION OF THE PARK NATIONAL BANK DIVISION OF THE PARK NATIONAL BANK DIVISION OF THE PARK NATIONAL BANK DIVISION OF THE PARK NATIONAL BANK DIVISION OF THE PARK NATIONAL BANK PARK PARK PARK PARK PARK NATIONAL BANK NATIONAL BANK NATIONAL BANK NATIONAL BANK NATIONAL BANK FAIRFIELD NATIONAL BANK DIVISION OF THE PARK NATIONAL BANK PARK NATIONAL BANK New look. Same bank. Bigger promise. Where you mean more. For decades, our 12 community banking divisions have shared common values and a like-minded approach to service, but have operated under different brand names. We are unifying under the Park National name. We will more easily and consistently deliver more banking options that put the full breadth and depth of our resources to work for our customers, while maintaining the same hands-on, personalized services we’re known for delivering. Fellow Shareholders, In his book, Lead the Field, Earl Nightingale talks about the power of establishing a clear goal. Using one of his favorite analogies, Nightingale wrote the following: “If you should visit a ship in port and ask the captain for his next port of call, he’ll tell you in a single sentence. Even though the captain cannot see his port, his destination, for fully 99% of the voyage, he knows that it’s there, and that barring an unforeseen and highly unlikely catastrophe, he’ll reach it.” We embarked on a trip last year. We did not leave from New York City and we weren’t headed for London. We were headed on a Brand Journey. Our clear goal was to identify the brand story that would unite our organization, simplify our operations and clarify our story to our stakeholders. Though we could not see that goal for a long time, we knew it was there and that we’d reach it. Here’s how we did it: Our Brand Journey Readers of last year’s letter will recall your board of directors approved a new strategic plan in October 2018. In that plan, we identified seven stakeholders we serve: Customers, Associates, Communities, Partners, Shareholders, Boards and Regulators. A number of initiatives occurred to us as we considered the question, “How can we serve our stakeholders more?” We concluded none was more important than clarifying our brand story. As we entered 2018, we had already begun thinking about our brand and who might help us capture and articulate our brand story. In March 2018, the professionals at Adrenaline (adrenalineagency.com) presented their proposal to guide and assist us. We engaged them soon after the board approved our strategic plan, then we and Adrenaline began asking customers, prospects, colleagues and community members questions: • Where do you bank? Local community bank? Statewide bank? National bank? • How do you engage with that bank? With Park National Corporation (Park) division banks? • Did you know or care that your division bank is part of Park? • How much do you value our (or any bank’s) community service/support? • How do you view our operating model with 12 divisions operating under different names? • What would you think if we changed our name? To ask these questions, we employed surveys and conducted focus groups. We researched brands, branding and the influence brands carry. We also talked to industry experts and to other bankers we respect who had completed a brand journey similar to the one upon which we were embarking. 1 As we entered 2018, we had already begun thinking about our brand and who might help us capture and articulate our brand story. Park National Bank: Where you mean more.The entire exercise proved the value of questioning one’s assumptions…particularly those about which you are most sure. It has been said, “It isn’t what you don’t know that gets you into trouble. It’s what you know for sure that just isn’t true.” We were fairly sure the operating model we’ve employed since Fairfield National joined us in 1985 ─ local banks operated by local people under a local name ─ was something customers valued and would not want to change. Well, that assumption ─ while perhaps accurate for a number of years ─ “just wasn’t so” in 2018. The research revealed the following: • 89% of prospects want to deal with a statewide or national bank ‒ and most customers/prospects did not know we have offices in four states and customers across the country. • Customers/prospects were unaware their local division bank was part of the larger Park organization. • Customers did not care about the name of the bank, as long as: 1. They could still deal with their banker. 2. They could keep their checks and account numbers. 3. We continued to support our communities. Over a period of five months (last May-September), Adrenaline walked us through the research. Our Leadership Group (all business line leaders and division presidents), our corporate board and our division advisory boards all weighed in on how we might respond to the data. The vote was unanimous; we all agreed the evidence was overwhelming ─ we could serve our customers, prospects, colleagues and communities more if we unified our brand and united under one name: Park National Bank. In December of last year, we began informing customers and community leaders of our decision. The response has been overwhelmingly positive. The most common responses were: • Can I still deal with my banker? (Yes) • Will you still support our local community? (Yes) • Makes perfect sense. • Thought you would have done it years ago. • Didn’t know my bank was part of a larger organization…that’s good news. By the time you read this, we will be absorbed completely with our next steps: • Branch rebrand: updating our branch/bank locations with new interior and exterior signage. • Customer-facing messages and materials: adding our unified brand name, logo, taglines and other associated marks. • Internal systems and operations: system and process changes to support one unified brand. 89% of prospects want to deal with a statewide or national bank. 2 Park National Bank: Where you mean more.Our brand unification project is large, pervasive and complex. But as one of our division presidents said, “(the) Collaboration to become united under one brand started a transformation within our company…I personally feel everyone is working together more for common goals…” We suggested to our stakeholders when we announced the brand change that it would Unify, Simplify and Clarify our world and thus enhance our ability to serve more. The early results are promising and spirits are high. Adrenaline has been everything we could ask for in a brand journey guide and more. Their people combine technical brilliance with genuine warmth and empathy. While we were immersed in our brand unification project, the world continued to spin. Here are our favorite numbers from the past three years: Revenues and expenses were both affected by acquisitions we believe are excellent additions to the Park family. 3 Park National Bank: Where you mean more.To be fair, our year-over-year performance did not decline as the figures suggest. Revenues and expenses were both affected by acquisitions we believe are excellent additions to the Park family. We have plenty of potential to improve these favorite numbers in 2020 and we intend to. Player Changes As we announced last year, Matt Miller became president of Park National Bank (PNB) and Park May 1, 2019. He joined the boards of Park and PNB as well. David Trautman retained his CEO role and added chair duties. Dan DeLawder retained his chair of the executive committee role. These changes continue a long tradition of deliberate, intentional leadership succession. The common question we get is, “What’s going to change for you three?” To quote Bill McConnell and Dan, from their 1998 shareholder letter: “Leadership transitions are sometimes difficult, often awkward. We are somewhere in the middle of this business at Park National…The (three) of us are not quite certain how all of this will play out, but we know we can make it work. We’ve worked together in harmony for a lot of years and intend to continue.” Thus far, we have made it work. Matt’s phone rings more because people most often want to “talk to the president.” Few people call for the chair or the chair of the executive committee. But Dan has found that as his PNB and Park duties have shifted, he has had more time for important community leadership. Those of you who know Dan will rest easier knowing he is leading community members in addressing our most pressing challenges and capitalizing on our most exciting possibilities. On July 1, 2019, after 21 years as president of our Fairfield National division, Steve Wells assumed a new role as division president liaison. His 36 years with Park give him a unique perspective that will help our division presidents and their teams maximize their contributions to all our stakeholders. Steve is able to refocus his talents to help us in this way after working closely to develop his successor, Laura Tussing. Laura has been a capable and versatile leader, most recently as head of Fairfield’s highly successful Trust department. Her talents are well known in the community as well, where she serves on the board of the Lancaster Festival and as chair of the Fairfield Medical Center. She has been board chair of Big Brothers and Big Sisters of Fairfield County and is president-elect of the Lancaster Rotary Club and chair of the Fox Family YMCA. We are excited for both Steve and Laura as they deploy their talents in new ways to help our colleagues, customers and communities. In 2019, Mark Miller and Todd Bogdan joined our Leadership Group. This group serves as our management governing body; they are the people to whom your authors most often turn for advice and counsel. Mark’s background in Process Management, Lean Six Sigma and Continuous Improvement prepared him well to lead our emerging Process Transformation department and increase its contribution to Park. His charge is to find more ways to save us steps, clicks and calls − i.e., to be We’ve worked together in harmony for many years and intend to continue. 4 Park National Bank: Where you mean more.We legally and formally welcomed our new colleagues at Carolina Alliance on April 1, 2019. more efficient and effective in everything we do. He has since added Project and Supply Chain Management to his responsibilities. He possesses the rare ability to let data inform his thinking while remembering we work with people, not automatons. Todd joined NewDominion as Chief Operations Officer in 2016. Todd is what baseball scouts call a “five-tool player.” He has played nearly every role in banking, including: credit, operations, branch administration and information technology. After NewDominion converted to Park’s systems, Todd found himself with extra capacity. Serendipitously, we were looking to add talent to our technology leadership team. We ended up splitting the Chief Information Officer’s (CIO) role (held by Greg Rhoads) into two roles: CIO (more strategic) and Chief Technology Officer (CTO-more tactical). Greg remains our CIO and can now focus on innovation and strategy. Todd assumed the CTO role and is responsible for keeping our systems running smoothly, and finding new ways to improve our service to technology users. He has a gift for translating complex technical issues into common sense language. Carolina Alliance Bank (CAB) We legally and formally welcomed our new CAB colleagues on April 1, 2019. In October, we successfully converted their systems to ours, including core, phone, mobile and online banking. Successful conversions don’t just happen. Many people worked countless hours on the conversion while holding down their day jobs. We can never forget we are asking our new colleagues to deliver great service to customers, but in a new language and with new tools. It is as if a native German-speaking surgeon was dropped into Beijing and asked to perform a successful surgery while her colleagues were speaking Mandarin and employing acupuncture as the anesthetic. With our NewDominion division that joined us in 2018, we now have more than $1 billion in assets in the Carolinas. We have great people there who are equal to the opportunities available. We look forward to helping them serve customers and welcome prospects to the Park family. Indirect Lending Group Three years ago, we created our indirect lending group. While we have made indirect loans (mostly auto, boat and RV loans originated at dealers and approved by us) for decades, we previously employed a distributed system of approvals throughout our banking divisions. The complexity of managing an increasingly large portfolio combined with advances in technology convinced us to reconsider our indirect lending model. Taking the best from our old model while acknowledging where we could improve led us to develop and staff a stand-alone Indirect Lending department. Under the leadership of Rob Springer and regional leaders Erica Chance, Matt Colwell, Eric McKee and Jerry Simon, this group of 18 professionals works with 650 auto, boat and RV dealers to offer indirect loans to customers throughout Ohio, Indiana and Kentucky. 5 Park National Bank: Where you mean more.Growing balances while reducing delinquencies and charge-offs, as our indirect lending colleagues have done, is the Holy Grail of lending. As a side note, our indirect lending group has had no turnover in the past four years. This is a tribute to Rob, our regional leaders and our indirect lending team’s deep engagement with dealers, customers and each other. We believe we can export our indirect services to communities throughout our footprint in the Carolinas. Scope Aircraft Finance In 1994, Scope Aircraft Finance joined the Park family. At the time, they had $14 million in loans and leases. This year, they topped $300 million for the first time. Under Bob Kent’s leadership, Bryan Byers, Alaina Joseph, Drew Knoesel, Charlie Sauter, Mike Smith and their Scope colleagues serve customers and dealers throughout the United States. Customers tell us they value the Scope team’s personal approach, experience and passion for aviation. Scope professionals are regulars at industry conferences and trade shows, sharing their knowledge through speaking engagements and one-on-one meetings. Last year, the National Business Aviation Association recognized Mike Smith as one of their “Top 40 Under 40.” We have many bank customers and prospects who would benefit from Scope’s expertise and service for their aircraft finance needs. We finance everything from the smallest Piper Cub to high-performance turbines to light jets. Perhaps you have thought about the benefits of flying personally and/or privately. Contact our Scope team (scopeair.com or 800-357-5773) to see if we can help that dream come true. Trust and Investments Department A number of people are unaware that we have a Trust and Investments department. This is a bit surprising, for we have offered trust, estate planning, wealth management services, and employee benefits plan administration for decades. Perhaps our team’s relative anonymity is understandable, as our Trust colleagues are inclined to extreme modesty. They simply don’t talk about their accomplishments. Fortunately, your authors are not burdened by such humility. Customers tell us they value our personal approach, experience, and passion for aviation. 6 Park National Bank: Where you mean more.Here’s the team’s record over the past three years (in billions): If you need money, we lend it. If you have money, we offer deposits and investment services. These are excellent results. We want to add trust and investment services in Louisville, KY; Asheville, NC; and Spartanburg and Greenville in SC as well. Scott McMahon joined us last year as a trust professional in Charlotte, NC and he’s off to an excellent start. If you need money, we lend it. If you have money, we offer deposits and trust and investment services. Either way, we are here to serve you. Park People Our organization is a wonderful blend of promising rookies, top draft picks and seasoned veterans. Each of us has a different story for why we came here and why we remain. A couple common threads knit us together: we love to serve and we value an environment where we can grow personally and professionally. Bound by these ideals, our colleagues tend to stay around for a long time. Here’s a summary of those who’ve been here for more than 10 years: 7 Park National Bank: Where you mean more.In one of the videos we published to introduce our unified brand, Fairfield National colleague Brenda Shamblin talked about Park people: “(Customers) choose us because of who we are. They choose us because of the people (who) are behind the desks, on the teller line, on the other end of the phone. They choose us because they trust us. They choose us because they know we care. We’re genuine. We want to take good care of our customers, of each other, of our shareholders, and you just don’t find that everywhere.” Tenured bankers who love to serve…a rare and pleasing combination. Customer Care Center What the world describes as a “call center,” we define as our Customer Care Center (CCC). We established our CCC in January 2017. The idea was to serve customers when they needed service, regardless of time zones, holidays, weekends or “non- office hours.” They were particularly helpful during our Carolina Alliance conversion which occurred over a holiday weekend. John Kimberly, Carolina Alliance president, said the CCC was a “game changer” for their customers and colleagues. CCC has been a game changer as well for customers around the world who need to talk to a Park National banker. New Board Members Michael T. Brandy Carl R. Bartlett W. Louis Bissette, Jr. Terrence L. Cash T. Alexander Evins Marsha H. Gibbs George M. Groome Jason N. Judd John D. Kimberly Samuel H. Maw, Jr. D. Byrd Miller, III Joseph M. Pazdan, II John S. Poole Mark Ramser William Allen Rogers, II Cheryl L. Snyder L. Terrell Sovey Tim Thompson Jennifer Walters Larry A. Webb W. Lewis White, Sr. Park National Division, Southwest Ohio & Northern Kentucky Carolina Alliance Division Carolina Alliance Division Carolina Alliance Division Carolina Alliance Division Carolina Alliance Division Carolina Alliance Division Park National Bank/Park National Corporation Carolina Alliance Division Carolina Alliance Division Carolina Alliance Division Carolina Alliance Division Carolina Alliance Division Park National Corporation Carolina Alliance Division Carolina Alliance Division Carolina Alliance Division Century National Division Fairfield National Division Carolina Alliance Division Carolina Alliance Division We are here to serve you, 24/7/365. 8 Park National Bank: Where you mean more. Fond Farewells James R. DeRoberts Jim notified your board in January 2020 that he would not stand for re-election. Jim has been a friend and trusted advisor to the banking community in Ohio for 40+ years. Long before Jim joined your board, he and his firm helped us prudently navigate complex insurance issues, coverages and policy analysis. Beyond his technical expertise, Jim has been an unwavering supporter of Park for decades and we will miss his candor, wisdom and wit. But he and his wife, Shelly, have kids and grandkids they’d like to see more often and no two people have earned that joy more. We wish them and their family all the best. Jeffry D. Harris Jeff notified the First-Knox advisory board in December 2019 that he had accepted a position with a law firm in Columbus and would be resigning as an advisory board member. Jeff served as the executive director of the Knox Area Development Foundation for four years. He started the Knox County Land Bank and was instrumental in attracting new businesses to the community. Jeff will continue his work in public funding so we expect to run into him in the future. We wish him all the best in his new position. Lifelong Learning These books taught us new things or encouraged us to view the world through a different lens: The Second Mountain, The Quest for a Moral Life, by David Brooks Range, by David Epstein The Wilder Muir, selected by Bonnie J. Gisel 212° The Extra Degree, by Sam Parker Excellence Wins: A No-Nonsense Guide to Becoming the Best in a World of Compromise, by Horst Schulze The Impossible Climb, by Mark Synnott The Infinite Game, by Simon Sinek The Lion Tracker’s Guide to Life, by Boyd Varty 9 Park National Bank: Where you mean more.Final Thoughts At the headwaters of the Mississippi River, the average flow rate is 45 gallons per second. By the time the river discharges into the Gulf of Mexico south of New Orleans, its flow rate has increased to more than 4.4 million gallons per second. What has happened? Between the headwaters and the Gulf, hundreds of tributaries joined their flows together to magnify and amplify the collective flow. We believe our brand unification will operate similarly. We have 12 tributaries (divisions) that are joining their flows, their talents, their skills and their local knowledge into one powerful and compelling brand river. This unified platform is Park National Bank: Park National bankers live to serve, and we want to serve you (and anyone you send us) more. Please let us know how and when. David L. Trautman Chair and CEO Matthew R. Miller President C. Daniel DeLawder Chair, Executive Committee 10 Park National Bank: Where you mean more. Our Locations 11 Park National Bank: Where you mean more.44Scope has over $300 million in aircraft loans to customers in 44 of the 50 states. 12 Park National Bank: Where you mean more.650dealer relationships across Indiana, Ohio and Kentucky. Strong Relationships, Reliable Bankers When a customer receives a vehicle loan from our team of indirect lenders, it means getting a partner that wants to see them succeed. Our lenders deliver personalized service that has always made our organization stand out. We listen closely to our customers’ needs and offer flexible solutions to help them find the loan that best fits their life. We’ve established great relationships with 650 dealers across Ohio, Indiana and Kentucky, building a track record that dealers and customers rely on. Whether it’s a car or truck, boat, RV or ATV, our team is committed to meeting our customers’ needs, and that means flexibility to work with any dealership. A lender is available seven days a week, and extended hours mean we’re here when you need us. We’ve built strong relationships through our sponsorship of the annual Ohio RV & Boat Show for the past 10 years, developing a valuable network in those industries. Our reliability and accessibility have also made us a top choice for vehicle dealerships. We’ve thrived in delivering a seamless and easy process for customers, providing digital options that allow them to quickly submit their loan applications. In turn, that digital process has also made it a faster process for us to make decisions and get back with customers, which has only strengthened our relationships with dealerships and individuals. 13 Park National Bank: Where you mean more.23% increase in residential construction loans. Originated more than $651 million in mortgage loans. 14 Park National Bank: Where you mean more.$6.3B in assets managed (market value), a 17.6% increase. Building Relationships, Serving Generations Along with a full range of traditional loan and deposit services, we have helped individuals and families create strategies to achieve their financial goals and dreams. Our Trust and Investments professionals offer comprehensive financial and retirement planning, trust and estate planning for individuals, and retirement planning for businesses. We’ve worked hard to become a reliable source to our clients and enjoyed tremendous success in these areas in 2019, both in the total number of accounts and the total market value of those accounts. With nearly 8,000 accounts and a market value of $6.26 billion in total assets, our experts have helped clients navigate the intricate issues associated with investing in today’s economic environment. By making things simple and convenient for our clients, we’ve helped them feel secure about their financial future. From retirement plan services for businesses to personal investing to trust and estate planning, our team has a multitude of ways to serve families and businesses. Whether it’s investing for retirement, creating a trust, or setting up a business retirement plan, we offer personalized and flexible plans to meet our clients’ unique needs. By operating as a corporate fiduciary with our trust services, we also have a responsibility to put the needs of our clients first and always operate in their best interest. Taking the time to get to know our clients and their unique financial situation remains vitally important to what we do and why we’ve become a popular choice for businesses and individuals. Our commitment to personal service has helped us build relationships that have lasted generations and it’s a mindset that will continue to set us apart. 15 Park National Bank: Where you mean more.674k calls handled by our Customer Care specialists in 2019, a 12% increase. 16 Park National Bank: Where you mean more.28% year-over-year growth in checks deposited through our apps. Digital Growth, Increased Convenience The way we deliver service to our customers must continue to adapt to keep pace with how they want to interact with us. In this day and age, that means making technology and digital enhancements, as well as providing accessibility and flexibility when it comes to how and where our customers bank. Our digital channels allow customers to bank from anywhere, any time and they have utilized those channels. Customers made more than 200,000 mobile deposits in 2019, nearly double from two years ago, while the total amount deposited has increased from $102 million in 2017 to almost $270 million this past year. That includes remarkable growth with our business mobile deposits, which increased by 13,000 to nearly 37,000 in 2019. That led to $140 million in business mobile deposits, more than doubling the amount from 2018. Personal banking app users also increased from 75,000 in 2017 to over 100,000 in 2019. We continue to focus on delivering a great digital customer experience. Our digital interactions included more than 2 million text messages last year, an increase of nearly 300,000 from 2017. We invest in technology on two levels: maintenance and strategy. Maintenance includes updating operating systems, application software, networks and more to preserve excellent service levels. Our strategic technology investment includes software and/or network configurations that offer new features and more convenience. In 2019, the Park board approved projects totaling more than $40 million to address both categories. Customers are engaging with us differently than they did just five years ago, and our technology investments, along with our unified brand, will help us continue to serve customers when and where they find it convenient. 17 Park National Bank: Where you mean more.Line of Business Leaders Todd Bogdan Chief Technology Officer Adrienne Brokaw Corporate Auditor Tom Button Chief Credit Officer Tom Cummiskey Chief Trust and Investments Officer Bob Kent President Scope Aircraft Finance Tim Lehman Chief Operating Officer Laura Lewis Chief Human Resources and Marketing Officer Mark Miller Project Management and Process Transformation Greg Rhoads Chief Information Officer Cheryl Snyder Chief Retail Officer Paul Turner Chief Treasury Officer Steve Wells Division President Liaison Jeff Wilson Chief Risk Officer 18 Park National Bank: Where you mean more.Board of Directors William T. McConnell Emeritus, Director since 1977 Donna M. Alvarado President Brady T. Burt Chief Financial Officer C. Daniel DeLawder Chair, Executive Committee James R. DeRoberts Partner F.W. Englefield, IV President AGUILA International Park National Corporation Park National Corporation Director since 2013 Director since 1994 Gardiner, Allen, DeRoberts Insurance Director since 2015 Englefield, Inc. Director since 2005 Alicia Sweet Hupp President and CEO Jason N. Judd Senior Vice President Stephen J. Kambeitz Private Investor Timothy S. McLain Vice President Sweet Manufacturing Company Big Lots, Inc. McLain, Hill, Rugg & Associates, Inc. Matthew R. Miller President Park National Corporation Director since 2015 Director since 2019 Director since 2010 Director since 2010 Director since 2019 Robert E. O’Neill President Mark R. Ramser President Julia A. Sloat Senior Vice President David L. Trautman Chair and CEO Leon Zazworsky President Southgate Corporation Ohio Cumberland Gas Co. American Electric Power, Inc. Park National Corporation Mid State Systems, Inc Director since 2013 Director since 2019 Director since 2015 Director since 2005 Director since 2003 Executive Officers Brady T. Burt Chief Financial Officer C. Daniel DeLawder Chair, Executive Committee Matthew R. Miller President David L. Trautman Chair and CEO Note: Mr. Burt is not a member of the board of directors 19 Park National Bank: Where you mean more.Advisory Board Members Carolina Alliance Division Carl R. Bartlett Retired, Former Mayor Town of Black Mountain, NC W. Louis Bissette Jr. Attorney, McGuire, Wood & Bissette Law Firm Terrence L. Cash President, Caman Group T. Alexander Evins Attorney/Partner, Parker Poe Adams & Bernstein, LLP Marsha H. Gibbs Director, Gibbs International George M. Groome Board Chair, Colton, Groome & Company John D. Kimberly President, Carolina Alliance Division Samuel H. Maw Jr. Retired D. Byrd Miller III CFO & Managing Member, William Barnet & Son, LLC Joseph M. Pazdan, II Managing Principal, McMillan Pazdan Smith Architecture John S. Poole Retired CEO, Carolina Alliance Bank William Allen Rogers, II Principal, Ewing Capital Partners, LLC/Allen C. Ewing & Co. Cheryl L. Snyder Chief Retail Officer, Park National Bank L. Terrell Sovey President, Management Advisory Services Larry A. Webb Principal, KDS Commercial Properties, Webb Development, LLC W. Lewis White, Sr. Owner, W. Lewis White Company Century National Division Michael L. Bennett Second Capital Consulting, LLC Julie A. Brown Fink’s Harley-Davidson, Southside Collision, Fink’s Quality Cars and Fink’s Custom Vans Clinton W. Cameron Cameron Drilling Company Ward D. Coffman, III Coffman Law Offices Scott D. Eickelberger Kincaid, Taylor and Geyer Dr. Susan K. Hasseler Muskingum University Patrick L. Hennessey P&D Transportation Henry C. Littick, II Southeastern Ohio Broadcasting Systems Thomas M. Lyall Chair, Century National Division Timothy S. McLain, CPA McLain, Hill, Rugg & Associates Patrick L. Nash President, Century National Division Timothy Thompson Primary Aim Fairfield National Division Charles P. Bird, Ph.D. Retired, Ohio University Dean DeRolph Kumler Collision and Automotive Jennifer Johns Friel Midwest Fabricating Company Leonard F. Gorsuch Fairfield Homes James L. McLain, II J. McLain CPA Group Jonathan W. Nusbaum, M.D. Retired Surgeon S. Alan Risch Risch Drug Stores Laura F. Tussing President, Fairfield National Division Jennifer Gorsuch Walters Fairfield Homes Stephen G. Wells Park National Bank First-Knox National Division Robert E. Boss President, First-Knox National Division Timothy R. Cowen Cowen Truck Line Jeffry D. Harris Area Development Foundation Korey M. Kidwell Murray, Rauzi, Kidwell & Cunningham, Ltd. William B. Levering Levering Management, Inc. Daniel L. Mathie Critchfield, Critchfield & Johnston, Ltd. Matthew D. Miller Mayor of Ashland Mark R. Ramser Ohio Cumberland Gas Company Sara C. White CLT Residential Park National Division Donna M. Alvarado AGUILA International C. Daniel DeLawder Chair, Executive Committee, Park National Bank James R. DeRoberts Gardiner, Allen, DeRoberts Insurance F.W. Englefield, IV Englefield, Inc. Jason N. Judd Big Lots Stephen J. Kambeitz Private Investor William T. McConnell Director Emeritus, Park National Bank Matthew R. Miller President, Park National Bank Robert E. O’Neill Southgate Corporation Julia A. Sloat American Electric Power David L. Trautman Chair and CEO, Park National Bank Leon Zazworsky Mid State Systems, Inc. Park Southwest Division Michael T. Brandy Brandicorp Daniel L. Earley Chairman, Retired President, Park Southwest Division Jeanne M. Golliher Cincinnati Development Fund David J. Gooch President, Park Southwest Division Kim M. Rose Critchfield, Critchfield & Johnston, Ltd. Martin J. Grunder, Jr. Grunder Landscaping Company Vickie A. Sant Chair, First-Knox National Division Richard W. Holmes Retired, Pricewaterhouse Coopers, LLP Roger E. Stitzlein Loudonville Farmers Equity Chris D. Tuttle Amish Oak Furniture Company Gordon E. Yance Retired, First-Knox National Division NewDominion Division Kenneth R. Beuley The Keith Corporation Larry H. Maxey Synchronic Business Solutions Thomas E. Niehaus Vorys Advisors LLC Richland Division Mark Breitinger Milark Industries, Inc. Michael L. Chambers J&B Acoustical, Inc. Dr. Jack M. Cathey University of North Carolina at Charlotte Elizabeth A. DeLaney Spherion Mid-Ohio Employment Services Louis Foreman Enventys Charles T. Hodges New Forum David L. Hood, Jr. Hood, Hargett & Associates J. Blaine Jackson CEO, NewDominion Division David Longo CBI Dennis W. Moser The Moser Group Donald Philip Renaldo, M.D. Donald Automotive Group Chris R. Hiner President, Richland Division Timothy J. Lehman Chief Operating Officer, Park National Bank Jeffrey S. Monica McDonald’s Linda H. Smith Ashwood, LLC Rick R. Taylor Jay Industries, Inc. Second National Division Steven C. Badgett Retired, Second National Division Tyeis Baker-Baumann Rebsco Wayne G. Deschambeau Wayne HealthCare Travis J. Faber Faber & Associates Travis L. Fliehman Fliehman Law Group Jeffrey E. Hittle Hittle Buick GMC Michael J. Pax Pax Machine Works John E. Swallow President, Second National Division Security National Division R. Andrew Bell Marsh & McLennan Agency John A. Brown President, Security National Division Alicia Sweet Hupp Sweet Manufacturing Company Larry E. Kaffenbarger Kaffenbarger Truck Equipment Company Thomas P. Loftis Midland Properties John McKinnon Clark Schaffer Hackett & Co. Scott D. Michael Michael Farms Dr. Karen E. Rafinski The Registry Chester L. Walthall Walthall Holding Co. Inc. Robert A. Warren Hauck Bros. United Division Lois J. Fisher Lois J. Fisher & Assoc. Michael L. Kocher MKB Farms Ltd. Michele M. McElligott Certified Public Accountant, Avita Health System Douglas M. Schilling Schilling, Inc. Donald R. Stone President, United Division Douglas E. Wilson Sr. Realtor, Craig A. Miley Realty & Auction, Ltd. Unity National Division Dr. Richard N. Adams Retired, Representative of Ohio General Assembly Tamara L. Baird-Ganley Baird Funeral Home Michael C. Bardo Retired, Hartzell Industries Rick M. Heinl Repacorp, Inc. Dr. Douglas D. Hulme Retired, Oakview Veterinary Hospital Timothy Johnston Retired Consultant Scott E. Rasor President, Unity National Division W. Samuel Robinson Retired, Murray Wells Wendeln & Robinson, CPAs 20 Park National Bank: Where you mean more.Park National Bank Founded in 1908 Senior Leaders Adrienne Brokaw Audit Todd Bogdan Technology Tom Button Commercial Loans Tim Lehman Operations Laura Lewis HR & Marketing Mark Miller Process Transformation Tom Cummiskey Trust and Investments Greg Rhoads Business Solutions Bob Kent Commercial Loans Cheryl Snyder Retail Banking Paul Turner Treasury Steve Wells Division President Liasion Jeff Wilson Compliance and Risk Management Matt Miller President David Trautman Chair and CEO Dan DeLawder Chair, Executive Committee Brady Burt Chief Financial Officer Main Office 50 North Third Street Newark, OH 43055 740-349-8451 Financial data is for Park National Division. Serving more in our community Our associates contribute thousands of hours annually supporting countless organizations, along with personal financial commitments. Park’s financial contributions mirror our associate involvement, giving to local United Way organizations, the John and Mary Alford Center for Science and Technology on the OSU-Newark and COTC campus, The Works, Midland Theatre and a long list of other charitable and social service organizations that help improve the communities we serve. 21 Park National Bank: Where you mean more.Carolina Alliance Division Joined Park in 2019 Senior Leaders Janice Addington HR & Marketing David Barnett Greenville Market President Tim Camp Commercial Loans Jeff Covington Credit Officer Coleman Edmunds Retail Banking John Kimberly President Main Office 200 South Church Street Spartanburg, SC 29306 864-208-2265 Carolina Alliance merged with Park 4/1/19 Serving more in our community Our bankers take pride in the personal touch we provide by partnering with Mobile Meals, which delivers 1,500 hot meals daily to homebound seniors in Spartanburg County. Working with United Way of the Piedmont in Spartanburg, we have donated Bags of Love on Valentine’s Day to the Mobile Meals recipients since 2008 to help brighten their day. Each bag included items like flashlights, gloves, devotional books, soap, lotion and, of course, some sweet Valentine’s Day treats. 22 Park National Bank: Where you mean more.Century National Division Joined Park in 1990 Senior Leaders Steve Haren Retail Banking Bruce Kolopajlo Retail Banking Paula Meadows Mortgage Loans Terri Sidwell Cash Management Jody Spencer Trust and Investments Alton Thompson Commercial Loans Pat Nash President Main Office 14 South Fifth Street Zanesville, OH 43701 740-454-2521 Serving more in our community Volunteering at the Carr Center’s Special Riders program is a fulfilling way for our team to serve. This non-profit organization gives individuals with severe physical disabilities the chance to ride horses, working with them to achieve their highest quality of living. We assist riders with trips around the fairgrounds, providing assistance to their various programs. Our bankers also help with facility upgrades, participate in the annual golf outing and contribute to their cake auction. 23 Park National Bank: Where you mean more.Fairfield National Division Joined Park in 1985 Senior Leaders Jamey Binkley Retail Banking Jeff Guminey Commercial Loans Brenda Shamblin Mortgage Loans Kim Sheldon Commercial Loans Luann Snyder Trust and Investments Tina Taley Mortgage Loans Laura Tussing President Main Office 143 West Main Street Lancaster, OH 43130 740-653-7242 Serving more in our community For more than 35 years, we’ve been a valuable partner for the Lancaster Festival, which draws more than 40,000 people and brings $3.5 million in community spending each year. From hosting events in our Main Office lobby to advertising on the program to volunteering in various roles throughout the festival, we have annually provided our time and financial resources as a major supporter. Our bankers have also served on the Lancaster Festival board of directors and fundraising committee. 24 Park National Bank: Where you mean more.First-Knox National Division Joined Park in 1997 Senior Leaders Cheri Butcher Trust and Investments Cindy Higgs Mortgage Loans James Hobson Commercial Loans Julie Leonard Operations Bob Boss President Main Office 1 South Main Street Mount Vernon, OH 43701 740-399-5500 Serving more in our community Each month during the school year, we’ve visited at-risk third, fourth and fifth graders at Dan Emmett Elementary School in Mount Vernon as part of their Tiger Club afterschool program. Our bankers organize and lead a fun activity with the students, and then teach them about the bank or a particular line of business. We’ve been fortunate enough to meet with nearly 50 kids for the past two years, providing an enjoyable learning opportunity in the process. 25 Park National Bank: Where you mean more.NewDominion Division Joined Park in 2018 Senior Leaders Greg Burke Chief Credit Officer Tim Ignasher President Kelly King Commercial Credit Blaine Jackson CEO Main Office 1111 Metropolitan Avenue 5TH Floor Charlotte, NC 43701 704-943-5700 NewDominion merged with Park 7/1/18 Serving more in our community Basketball is a way to bring people together, and we’ve deepened our local commitment through a partnership with the NBA’s Charlotte Hornets. As the preferred community bank of the Hornets for the third season, our Bank Shots Program provides a $25 donation to local non-profit organizations for every bank shot made by the team. At the end of the 2020 season, we’ll give $8,500 apiece to Philips Academy, Classroom Central and the Dilworth Center for Chemical Dependency. 26 Park National Bank: Where you mean more.Park National Division Southwest Ohio & Northern Kentucky Joined Park in 2005 Senior Leaders Jana Beal Retail Banking William Schumacker Trust and Investments Adam Stypula Commercial Loans Dave Gooch President Main Office 4550 Eastgate Boulevard Cincinnati, OH 45245 513-753-0900 Serving more in our community Partnering with St. Vincent de Paul, Morris Home Furniture and the MLB’s Cincinnati Reds, we provided beds for 50 children in the community through the Day to Dream initiative. These children were previously sleeping on makeshift beds on the floor or on a sofa. Our bankers helped unload the trucks and assemble the beds, which were delivered to the family’s homes. We got to see their joy when the beds, complete with sheets, comforters and pillows, were revealed. 27 Park National Bank: Where you mean more.Richland Division Joined Park in 1987 Senior Leaders John Cleland Operations Don Harris, Jr. Commercial Loans Charla Irvin Trust and Investments Jeff Parton Retail Banking Ryan Smith Mortgage Loans Frank Wagner Executive Vice President Chris Hiner President Main Office 3 North Main Street Mansfield, OH 44901 419-525-8700 Serving more in our community Our goal was to serve our local educators more this past year. We did that by providing lunch with an onsite cookout during teacher work days, and educator socials in our Main Office for school districts across Richland County. Our bankers also volunteered their time in the classroom by offering financial literacy, and working in concession stands during various sporting events. Lastly, we contributed grants to schools, allowing teachers to add an extra special touch to their classrooms. 28 Park National Bank: Where you mean more.Second National Division Joined Park in 2000 Senior Leaders Russ Badgett Commercial Loans Todd Durham Trust and Investments Joy Greer Retail Banking Dan Schmitz Commercial Loans Brian Wagner Mortgage Loans John Swallow President Main Office 499 South Broadway Greenville, OH 45331 937-548-2122 Serving more in our community Interacting with more than 1,000 high school seniors at Edison State Community College’s annual “Inspire Career Concert,” our bankers provided students feedback as they planned for their futures. We answered questions and talked about career opportunities in banking, and we were excited to make an impact on them. A group of students from Sidney High School told the Daily Advocate newspaper our booth offered the best advice of anyone at the event. 29 Park National Bank: Where you mean more.Security National Division Joined Park in 2001 Senior Leaders Connie Craig Retail Banking Jeff Darding Executive Vice President Peg Foley Trust and Investments Thom Goodfellow Commercial Loans Andy Irick Retail Banking John Brown President Main Office 40 South Limestone Street Springfield, OH 45502 937-324-6800 Serving more in our community As part of United Way’s County Service Days, we assisted our community in many ways. In Champaign County, associates cleaned up historic Oak Dale Cemetery. We served at four different locations in Clark County, sprucing up the Community Gardens Home Development and cleaning the Crabill Homestead. Our bankers completed a painting project for Encompass Connection Center to help improve family relationships, and aided in the clean-up of downtown Springfield. 30 Park National Bank: Where you mean more.United Division Joined Park in 2000 Senior Leaders Scott Bennett Commercial Loans John Herring Commercial Loans Jennifer Kuns Mortgage Loans Don Stone President Main Office 401 South Sandusky Avenue Bucyrus, OH 44820 419-562-3040 Serving more in our community Working with Crawford County 4-H has always been an important part of our outreach, and our support has taken many forms over the years. From sponsoring the Cattle Car-lot Program, volunteering at various sales, donating to the organization and serving as club advisors, our bankers have been dedicated to helping as many exhibitors as possible. In 2019, we had the honor of earning their “Friend of 4-H” award, given annually to those who have had a noteworthy impact on 4-H. 31 Park National Bank: Where you mean more.Unity National Division Joined Park in 2001 Senior Leaders Dwayne Cooper Retail Banking Kyle Cooper Mortgage Lending Bryant Fox Commercial Loans Ken Magoteaux Trust & Investments Lisa McGraw Cash Management Scott Rasor President Main Office 215 North Wayne Street Piqua, OH 45356 937-615-1042 Serving more in our community Our partnership with Pink Ribbon Girls, an organization founded by breast cancer survivors to support and empower those with breast and gynecological cancers, grew on a number of levels. Along with helping with their banking needs, we volunteered at their annual fundraiser in Tipp City, assisting with set-up and making goodie bags for the event. Our bankers also contributed funds, helping them reach their goal of nearly $1 million to provide services for cancer patients. 32 Park National Bank: Where you mean more.Shareholder Information Stock Listing NYSE AMERICAN Symbol – PRK CUSIP #700658107 General Shareholder Inquiries Park National Corporation Brady Burt, Chief Financial Officer 50 North Third Street Post Office Box 3500 Newark, Ohio 43058-9983 740-322-6844 bburt@parknationalbank.com Dividend Reinvestment Plan The Corporation offers a plan whereby participating shareholders can purchase additional Park National Corporation common shares through automatic reinvestment of their regular quarterly cash dividends. All commissions and fees connected with the purchase and safekeeping of the common shares are paid by the Corporation. Details of the plan and an enrollment card can be obtained by contacting the Corporation’s Stock Transfer Agent and Registrar as indicated below. Direct Deposit of Dividends The Corporation’s shareholders may have their dividend payments directly deposited into their checking, savings or money market account. This direct deposit of dividends is free for all shareholders. If you have any questions or need an enrollment form, please contact the Corporation’s Stock Transfer Agent and Registrar as indicated below. Stock Transfer Agent and Registrar The Park National Bank Shareholder Services Post Office Box 1270 1 South Main Street Mount Vernon, Ohio 43050-1270 740-399-5208 or 800-837-5266 ext. 5208 shareholderservices@firstknox.com Form 10-K All forms filed by the Corporation with the SEC (including our Form 10-K for 2019) are available on our website by clicking on the “SEC Filing” section and then the “Documents/SEC Filings” section of the “Investor Relations” page. These forms may also be obtained, without charge, by contacting the Secretary as indicated above. Website parknationalcorp.com parknationalcorp.com 50 North Third Street, Newark, OH 43055 

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