2018 | A year in review
Best Business Bank
in Sonoma County
NorthBay Biz Magazine
Readers Poll
Top Corporate
Philanthropist
North Bay
Business Journal
One of the
North Bay’s Best
Places to Work
North Bay
Business Journal
A Steady Trajectory for Growth
Letter to our Shareholders, Employees, Customers, and Community
Through a continuous focus on our employees and processes, we successfully executed on our objective for
steady growth and commitment to our community in 2018. It is with pleasure that we share our year-end results
with net income 77% over the previous year. Growth in both deposits and loans, which increased 15.16% and
15.3%, respectively, compared to 2017.
We are fortunate to have attracted and retained knowledgeable and experienced staff to support our growth
objectives. To accommodate our expanding team, 64 full-time staff beginning in 2016 to our current 94 employees
as of mid 2019, we expanded our headquarter building. All administrative staff now reside in a refreshed,
modernized workspace with the latest technology.
There is a strong movement in Sonoma County to embrace renewable energy and we are doing our part to
improve our carbon footprint. We recently installed solar carport canopies at our headquarters which will offset
80% of our annual energy cost and provide shade on hot days. In addition, the lighting beneath the canopies adds
a layer of security for employees and customers, especially in the winter months. This includes two Electric Vehicle
Charging (EVC) stations to accommodate customers and employees who have electric vehicles.
In the fourth quarter, we announced a refresh to our brand with an updated logo that we felt better represented
the energy of our team and reflects how we are keeping pace with the ever-changing banking industry. We are
investing in technology to make banking simple and offering the latest products and services. We have expanded
our Small Business Administration lending program and have continued our support of Sonoma County Women in
Conversation.
One of our strengths is our culture of caring for each other, our customers and community. As we grow and seek
to attract new customers, we are dedicated to do our part to sustain the beautiful place we live, work and raise
our families. While our community is still in recovery having experienced the 2017 firestorm, Sonoma County
remains resilient.
We are focused on a steady trajectory for growth and success in the community banking industry. Our success
is dependent on continually meeting challenges with a collective team effort that balances the needs of our
shareholders, employees, and community. Banking is an art where the combination of listening and learning
creates a fulfilling environment of empowered employees who consistently contribute.
We thank you for the confidence and trust you have placed in us.
Allan Hemphill
Chairman of the Board
James Brush
President & CEO
Executive Leadership
The executive Leadership Team was enriched by the addition of Camille Kazarian, Executive Vice
President and Chief Financial Officer. Camille joined the Bank in December of 2018, with more than
22 years of accounting experience. Camille provides leadership, direction and management of the
finance and accounting team.
The diverse, knowledge and experience each member of our leadership team brings, in and out
of the banking industry, complement each other and creates a well-rounded Executive Leadership
Team.
James Brush
President and
Chief Executive Officer
Camille Kazarian
Executive Vice President and
Chief Financial Officer
Genie Del Secco
Executive Vice President and
Chief Operating Officer
Brian Reed
Executive Vice President and
Chief Credit Officer
Brandy Seppi
Executive Vice President and
Chief Lending Officer
Board of Directors
Allan J. Hemphill
President
Hemphill and Associates
James E. Brush
President and
Chief Executive Officer
Summit State Bank
Jeffery B. Allen
President
Allen Land Design
Josh C. Cox, Jr.
Banking Consultant
Josh Cox & Associates
Bridget M. Doherty
Co-owner
Encore Events Rentals
General Manager
Cal-West Rentals
Todd R. Fry
Chief Accounting Officer
Installed Building Products, Inc.
Richard E. Pope
Environmental Planning and
Development Consultant
Nicholas J. Rado
President
Rado Consulting Services
Marshall T. Reynolds
Chairman of the Board
Champion Industries, Inc.
John W. Wright
Business Consultant
Culture, Diversity and Engagement
One of the most significant differentiators among the local businesses is the ability to create a culture where
employees feel supported by management and by fellow employees. The benefits of creating and nurturing this type
of culture are individuals who are happy and engaged, resulting in a friendly work environment where they care for
each other, customers and community.
In addition to offering a rich benefits package, generous vacation time, volunteer time off, and a supportive work
environment, we have participated in local career events and have been successful in attracting knowledgeable and
customer service-oriented team members. We recognize the importance of having a diverse workforce that reflects
the community we serve and consistently hire with this in mind.
As a community bank, we take our responsibility to give back to the community seriously. Our Summit Day of Service
gives every employee one workday a year to volunteer their time to organizations that they are passionate about.
This year, employees spent significant hours assisting with clean-up at a local service dog organization, creating
prosthesis, helping seniors, tutoring youth, or donating any time to an organization the individual wants to help.
Our team participated in the annual Best Place to Work survey and based on how our employees rated the Bank, we
earned the prestigious Best Place to Work award for the ninth consecutive year.
Since its inception in 2009, the Nonprofit Partner
Program has paid over $1.76M to local nonprofits
and charitable organizations that make a difference
in our community. In 2018, we donated more than
$350,000 to 171 local nonprofits, the largest annual
payout to-date.
Chris Castillo
Executive Director, Verity
Nonprofit and Community Commitment
We made several enhancements to the Nonprofit Partner Program last year including increasing the contribution rate on
operating accounts to increase our support. In addition, we broadened the organizations who can participate to all 501 (c)
designated tax-exempt organizations. All local nonprofits have been significantly impacted by the recent natural disasters
and the increase in the rate to our Nonprofit Partner Program helps offset some of the shortfalls they have experienced.
Many members of the Bank have taken leadership roles in our community by participating on a variety of local nonprofit
boards and committees including Bennett Valley Education Foundation, Burbank Housing, Free to Be, Community Child
Care Council (4Cs), Integrative Service for the Underserved, Court Appointed Special Advocates (CASA) and the United
Way of the Wine Country – to name a few.
We have expanded our Small Business Administration lending program and have continued our support of Sonoma County
Women in Conversation.
Financials at a Glance (In Thousands)
n
a
P
l
i
c
g
e
t
a
r
t
S
In late 2016 the strategic plan was changed to focus on organic growth of loans and local deposits with a related
increase in net income. This plan involved expanding personnel and systems to accomodate the anticipated growth,
which had an effect of decreasing net income in the first few years. The bank expects growth in personnel costs
to slow considerably in the second half of 2019 while expansion of the balance sheet and increase in income will
continue.
MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER
MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
The Bank’s common stock trades on the NASDAQ under the symbol “SSBI.” The quotations
shown below reflect for the periods indicated the high and low closing sales prices for our
common stock as reported by NASDAQ.
For the quarter ended
December 31, 2017
September 30, 2017
June 30, 2017
March 31, 2017
December 31, 2016
September 30, 2016
June 30, 2016
March 31, 2016
$
High
(1)
13.00
13.48
13.35
14.32
12.00
11.12
11.36
11.15
$
Low
(1)
12.10
12.25
12.70
11.83
10.52
10.55
10.58
10.48
Cash
dividends
declared
(1)
$
0.12
0.12
0.12
0.096
0.096
0.096
0.096
0.096
(1) Adjusted for the 2017 five-for-four stock split.
There were 157 common stock shareholders of record at December 31, 2017.
9
Information About Summit State Bank
Summit State Bank (the “Bank”) is a state-chartered commercial bank operating a traditional community banking
business within our primary service area of Sonoma County in California. We operate through five depository offices
located in Santa Rosa, Rohnert Park, Healdsburg and Petaluma. The Bank also has a loan production office in Roseville,
California.
The Bank was incorporated on December 20, 1982 and commenced operations as a California state-chartered savings
and loan. On January 15, 1999, the Bank received authority to convert its charter to a California state-chartered
commercial bank. On July 13, 2006, the Bank completed an underwritten initial public offering and listed its stock on
the Nasdaq Global Market under the symbol SSBI. The Bank’s deposits are insured by the FDIC in accordance with the
Federal Deposit Insurance Act and the related regulations of the FDIC.
We provide a broad array of financial services to small to medium-sized businesses and their owners and employees,
entrepreneurs, families, foundations, estates and individual consumers. We believe that our principal competitive
advantages are personal service, flexibility and responsiveness to customer needs. Our lending activities are primarily
focused on commercial real estate, construction, and business loans to our targeted clientele.
We emphasize relationship banking and we believe we offer our customers many of the management capabilities of
a large financial institution, together with the resourcefulness and superior customer service of a community bank.
Through our branches and the use of technology, we offer a broad array of deposit products and services for both
commercial and consumer customers, including electronic banking, cash management services and electronic bill
payment. We provide a comprehensive set of loan products, such as commercial loans and leases, lines of credit,
commercial real estate loans, Small Business Administration, or SBA, loans, and construction loans. We believe that
local decision-making ensures that our lending process is fast, efficient, and focused on maintaining our high credit
quality and underwriting standards.
Summit State Bank is committed to embracing the diverse backgrounds, cultures, and talents of its employees to create
high performance and support the evolving needs of its customers and community it serves. At the center of diversity is
inclusion, collaboration, and a shared vision for delivering superior service and results for shareholders. Presently, 82%
of management are women and minorities with 60% representated on the Executive Management Team.
Our Featured Partners
Our Featured Partner Program went digital in 2018. Previously, we provided tables in our branch lobbies so that our
Featured Partners could display their products and services.
With our new digital displays, we now have the opportunity to highlight multiple Featured Partners at one time, and
across all of our branches, when we were limited to one partner per branch in the past. This gives us even more
chances to interact with our customers, and to make them aware of how much we care about their business.
As a community bank, Summit State Bank takes great pride in promoting our customers and their businesses and
organizations. As such, our Featured Partner Program was implemented as a way for customers to showcase their
business or organization by displaying them on our digital displays in our branches.
Customers have been excited about being featured on the displays, and we look forward to continuing to support our
customers through this program.
As a community bank, Summit State Bank is proud to donate part of our net profit each year to support our local nonprofits and charitable organizations that make a difference in our community. In 2017 we donated more than 8.4% of our net profit! Company Contact
Information
Nasdaq: SSBI
Summit State Bank
P.O. Box 6188
Santa Rosa, CA 95406
707/568-6000
Corporate Secretary:
Barbara Gradman
Transfer Agent:
Computershare
462 South 4th Street
Suite 1600
Louisville, KY 40202
800/962-4284
Investor Information:
See “Investor Relations” on
our website.
www.SummitStateBank.com
Bicentennial
500 Bicentennial Way
Suite 101
Santa Rosa, CA 95403
707/568-6100
Montgomery Village
2300 Midway Drive
Santa Rosa, CA 95405
707/568-4975
Rohnert Park
10 Raley’s Towne Centre
Rohnert Park, CA 94928
707/568-4955
Healdsburg
1001 Vine Street
Healdsburg, CA 95448
707/433-5959
Petaluma
100 Petaluma Blvd. S.
Suite A
Petaluma, CA 94952
707/283-1120