The books are closed for 2011 and we are excited about 2012! We want to thank you for banking with us, your local community bank.  
 
Our industry has been in the hot seat the last couple of years and some have asked how their community bank is doing.  We’re happy to say that we are stable and poised to continue serving our customers and community like we have for more than 75 years.
 
You might notice a few new policies or more signatures required when doing your banking.  Our industry will see over 200 new regulations imposed on it in the next few years as a result of the Dodd – Frank Act.  
Our promise to you: We will do everything we can to comply with these regulations and still provide top-notch service to our customers. Please let us know if you do not feel we are keeping this promise!
 
We have noticed fewer people coming in the bank as our customers are busy and take advantage of internet banking and other electronic services.  With technological advances, we are adding new ways to access our services all the time.  While this is great for convenience, sometimes face to face interaction is best.  Please know that you are welcome here!
 
Some interesting numbers…  We have over 3,900 internet banking users who log in over 40,000 times per month and pay over 8,000 bills online monthly.  With that said, our tellers handled nearly 300,000 transactions in 2011.  At an average transaction size of $200, that would be $60,000,000! Our tellers had net offages of a mere $305 in 2011. Wow! That’s a 0.000508666% error rate – not bad.
 
Financially, the bank made a decent profit in 2011.  Total loans (farm, business, consumer and real estate on our books) were up 2.4% to $210 million in 2011.  This is after 2 years of decline so we are glad of that.  Your bank has money to lend!  Total deposits held steady at $274 million.  We wish to thank our depositors for entrusting us with your savings. Interest rates are low on deposits, but the money is safe and is being used for good purpose - to fund area businesses, farming operations and homes.  
Total capital is up slightly at 9.81% of assets compared to industry average of 9.42%.  In times like this, more capital is better!  We have a pretty clean loan portfolio and our local market is strong.  However, we are in the business of taking and managing risk - and losses happen in our line of business.  In 2011 we experienced increased losses on loans which ate into our reserves some.  Today, our non-performing loans are a respectable .98% of total loans compared to our national peer average of 2.75%.  We are thankful to be in business in NE Iowa where the economy is relatively strong.  
 
With interest rates so low, lots of folks have refinanced their home loans (some for the third or fourth time!) Off balance sheet, the bank refinanced over $45 million in fixed rate home loans sold to a third party investor.  This will save area residents about $675,000 in interest each year! As the only local provider of trust services in the area, we help people professionally manage their assets, such as, Life Insurance Trusts, Farms, Homes, Estates, IRAs and more.  Total assets managed in our trust department now exceed $40 million.
 
It’s important to help strengthen our community.  We track our volunteerism each year and in 2011 our officer staff volunteered over 2,000 hours to community non-profits.  Many of these hours were in leadership positions.  We also maintained our philanthropic support for local causes.
 
We are particularly proud of the role we are taking in financial education.  In 2011 we facilitated two 12 week Financial Peace University courses, graduating 62 people who now have a greater knowledge for financial success. We also started five area high schools with an online financial education program aimed at improving financial literacy at the teenage level.
 
Thanks again for banking with us!  People have hundreds of options for handling their money.  We are thankful that people see the importance of doing business locally.  Call on us anytime and we’ll do our best to serve you!  

Joe Grimstad & Ben Grimstad
Co-Presidents, Decorah Bank & Trust Company