FORM 10-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 [FEE REQUIRED]
For the fiscal year ended December 31, 1994
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 12 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 (NO FEE REQUIRED)
For the transition period form ___________________ to _____________________
Commission file number 0-6216
BRENTON BANKS, INC.
(Exact name of registrant as specified in its charter)
Incorporated in Iowa No. 42-0658989
State of other jurisdiction of (I.R.S. Employer
incorporation or organization Identification No.)
Suite 300, Capital Square, 400 Locust, Des Moines, Iowa 50309
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code 515-237-5100
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on which registered
None None
Securities registered pursuant to Section 12(g) of the Act:
Common Stock, $5 par value
(Title of class)
1
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports) and (2) has been subject to
such filing requirements for the past 90 days. Yes X . No .
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to
the best of the registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K [ X ]
The aggregate market value of the voting stock held by non-affiliates of the
registrant as of March 13, 1995, was $87,489,000.
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the most recent practicable date, March 13, 1995.
7,916,346 shares Common Stock, $5 par value
DOCUMENTS INCORPORATED BY REFERENCE
The Annual Report to Shareholders for the 1994 calendar year is incorporated
by reference into Part I and Part II hereof to the extent indicated in such
Parts.
The definitive proxy statement of Brenton Banks, Inc. which will be filed not
later than 120 days after the close of the Company's fiscal year ending
December 31, 1994, is incorporated by reference into Part III hereof to the
extent indicated in such Part.
1 of 246 Total Pages
2
TABLE OF CONTENTS
PART I
Page
Item 1. Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
(A) General Description . . . . . . . . . . . . . . . . . . . . 5
(B) Recent Developments . . . . . . . . . . . . . . . . . . . . 5
(C) Affiliated Banks . . . . . . . . . . . . . . . . . . . . . 7
(D) Bank-Related Subsidiaries and Affiliates . . . . . . . . . 8
(E) Executive Officers of the Registrant . . . . . . . . . . . 8
(F) Employees . . . . . . . . . . . . . . . . . . . . . . . . . 9
(G) Supervision and Regulation . . . . . . . . . . . . . . . . 10
(H) Governmental Monetary Policy and Economic
Conditions . . . . . . . . . . . . . . . . . . . . . . . . 12
(I) Competition . . . . . . . . . . . . . . . . . . . . . . . . 12
(J) Statistical Disclosure . . . . . . . . . . . . . . . . . . 13
Item 2. Properties . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Item 3. Legal Proceedings . . . . . . . . . . . . . . . . . . . . . . . 27
Item 4. Submission of Matters to a Vote of Security
Holders . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
PART II
Item 5. Market for the Registrant's Common Equity and
Related Stockholder Matters . . . . . . . . . . . . . . . . . . 27
Item 6. Selected Financial Data . . . . . . . . . . . . . . . . . . . . 27
Item 7. Management's Discussion and Analysis of Financial
Condition and Results of Operations . . . . . . . . . . . . . . 27
Item 8. Financial Statements and Supplementary Data . . . . . . . . . . 28
Item 9. Changes in and Disagreements with Accountants
on Accounting and Financial Disclosure . . . . . . . . . . . . 28
3
PART III
Item 10. Directors and Executive Officers of the Registrant . . . . . . 28
Item 11. Executive Compensation . . . . . . . . . . . . . . . . . . . . 28
Item 12. Security Ownership of Certain Beneficial Owners
and Management . . . . . . . . . . . . . . . . . . . . . . . . 28
Item 13. Certain Relationships and Related Transactions . . . . . . . . 28
PART IV
Item 14. Exhibits, Financial Statement Schedules and
Reports on Form 8-K . . . . . . . . . . . . . . . . . . . . . . 28
Exhibit Index . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
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PART I
Item 1. Business.
(A) General Description.
Brenton Banks, Inc. (the "Parent Company") is a bank holding
company registered under the Bank Holding Company Act of 1956 and a savings
and loan holding company under the Savings and Loan Holding Company Act.
Brenton Banks, Inc. was organized as an Iowa corporation under the name
Brenton Companies in 1948. Subsequently, the Parent Company changed its
corporate name to its current name, Brenton Banks, Inc. On December 31,
1994, the Parent Company had direct control of its 13 affiliated commercial
banks and 1 savings bank (hereinafter the "affiliated banks"), all of which
are located in Iowa, 5 of which are national banks organized under the laws
of the United States, 8 of which are state banks incorporated under the laws
of the State of Iowa, and 1 of which is a federal savings bank organized
under the laws of the United States. On December 31, 1994, the affiliated
banks were operating 44 banking locations in Iowa. All of the affiliated
banks are members of the Federal Deposit Insurance Corporation and all of the
affiliated national banks are members of the Federal Reserve System.
Brenton Banks, Inc. and its subsidiaries (the "Company") engages in
retail and commercial banking and related financial services. In connection
with this banking industry segment, the Company renders the usual products
and services of retail and commercial banking such as deposits, commercial
loans, personal loans, and trust services. The principal service rendered by
the Company consists of making loans. The principal markets for these loans
are businesses and individuals. These loans are made at the offices of the
affiliated banks and subsidiaries, and some are sold on the secondary market.
The Company also engages in activities that are closely related to banking,
including mortgage banking and investment brokerage.
The Parent Company furnishes specialized services to its affiliated
banks and subsidiaries including supervision, administration and review of
loan portfolios; administration of investment portfolios, insurance programs
and employee benefit plans; performance of audits; preparation of tax
returns; and assistance with respect to accounting and operating systems and
procedures, personnel, marketing, trust, investment brokerage services, cash
management services and banking facilities and equipment. Charges for the
services are based on the nature and extent of the services provided.
(B) Recent Developments.
New Directors. In July 1994, Thomas R. Smith retired from the
Board and Hubert G. Ferguson was elected to fill the position. Prior to his
retirement from active employment, Mr. Ferguson was the National Sales
Manager for Dain Bosworth, headquartered in Minneapolis, Minnesota. In
February 1995, the Board of Directors increased the number of directors from
six to seven and named Gary M. Christensen to fill the position. Mr.
Christensen is the President and Chief Operating Officer of Pella Corporation
in Pella, Iowa.
Stock Split. In May 1994, the Company declared a 3-for-2 stock
split in the form of a stock dividend. This transaction resulted in the
issuance of 2,633,895 shares of common stock and the transfer of $13,169,475
from retained earnings to common stock.
Common Stock Repurchase Plan. In March 1994, the Board of
Directors authorized a plan to repurchase $2,000,000 of the Company's common
stock. As of December 31, 1994, the Company had repurchased 44,800 shares,
at a total cost of $850,950.
Regulatory Developments. During 1994, the "Riegle-Neal Interstate
Banking and Branching Efficiency Act of 1994" (the "Interstate Banking Act")
was enacted. This law amends certain provisions of the federal banking laws
(including the Bank Holding Company Act) to permit the acquisition of banks
by banks or bank holding companies domiciled outside of the home state of the
acquired bank. The law will become effective on June 1, 1997. The Interstate
Banking Act seeks to provide a uniform interstate banking
5
law for all 50 states. Provisions of the law allow individual states to
"opt-out" of the provisions of the Interstate Banking Act by expressly
prohibiting merger transactions with out-of-state banks. Also, states are
permitted to impose certain conditions upon interstate mergers. States
electing to opt-out of the Interstate Banking Act must pass such a law prior
to June 1, 1997. In addition, the Interstate Banking Act also permits
certain affiliated financial institutions to act as agents for each other,
establishes limits upon the maximum deposits that may be held by any one
institution in the nation and in any one state and seeks to equalize the
competitive opportunities between the United States and the foreign banks.
Whether Iowa or other states surrounding Iowa will "opt-out" of the
provisions of the Interstate Banking Act prior to June 1, 1997 is unknown.
The full extent of the provisions of the Interstate Banking Act and its
effect upon the Company is unknown at this time.
During the first quarter of 1995, the FDIC proposed a reduction in
the Bank Insurance Fund (BIF) assessments. Under the proposed rate structure
BIF rates would be reduced from current rates of $.23 to $.31 per $100 of
deposits, to $.04 to $.31 per $100 of deposits based upon a risk based
assessment schedule. Such a reduction in insurance premium rates, if
enacted, could result in a 82% decrease in the Company's expense related to
BIF insured deposits. The proposed regulation would not affect the insurance
premiums on deposits insured by the Savings Association Insurance Fund
(SAIF). See Item 1, Section (G), Supervision and Regulation.
Recently, Congress announced the introduction of legislation which
could substantially change the regulatory framework in which banks and other
financial institutions operate. At the present time, it is impossible for
the Company to predict whether such legislation will be enacted and the
nature of the effects on the Company, if enacted.
Growth and Acquisitions. As part of management's strategic growth
plans, Brenton Banks, Inc. investigates growth and expansion opportunities
which strengthen the Company's presence in current or selected new market
areas. During 1995, the Company plans to continue expansion of its
traditional and non-traditional services. There are plans to open a
supermarket branch in Iowa City in 1995, as well as a telebanking center to
be headquartered in Des Moines. In addition, a new savings bank branch
facility in Ankeny will be completed in early 1995.
On October 1, 1992, Brenton Banks, Inc. merged with Ames Financial
Corporation and acquired its wholly-owned subsidiary, Ames Savings Bank, FSB,
of Ames, Iowa whose name has since been changed to Brenton Savings Bank, FSB.
The institution continues to operate as a federal savings bank, requiring
Brenton Banks, Inc. to also register as a savings and loan holding company.
As a savings and loan holding company, Brenton Banks, Inc. is required to
file certain reports with and be regulated by the Office of Thrift
Supervision. See Item 1, Section (G), Supervision and Regulation. Late in
1993, Brenton Savings Bank received approval to open a new banking office in
Ankeny, Iowa. In addition, the Brenton Savings Bank, FSB has received
approval to open a banking office in Iowa City, Iowa. Both Ankeny and Iowa
City are rapidly expanding markets not previously served by Brenton.
Restructuring of Organization. In December 1994, the Board of
Directors authorized a restructuring plan, which included merging the
Company's five national banks and eight state banks into a single, state
chartered banking organization under the laws of the state of Iowa. In
addition, the Board approved plans to consolidate banking facilities and
reduce the Company's work force by approximately 10 percent in 1995. A
restructuring charge was recorded in 1994 to cover the costs of implementing
this plan.
Strategic Planning Coordinating Team. In order to facilitate the
Company's strategic planning process, which included the restructuring plan,
a Strategic Planning Coordinating Team was named to direct these efforts.
That team is comprised of Robert L. DeMeulenaere, President, Brenton Banks,
Inc.; Woodward G. Brenton, President & CEO, Brenton First National Bank,
Davenport; Charles N. Funk, Vice President- Investments, Brenton Banks, Inc.;
Ronald D. Larson, President & CEO, Brenton Bank and Trust Company of Cedar
Rapids; Larry A. Mindrup, President & CEO, Brenton Savings Bank, FSB, Ames;
Phillip L. Risley, President & CEO, Brenton Bank, N.A., Des Moines; Steven T.
Schuler, Chief Financial Officer/Treasurer/
6
Secretary, Brenton Banks, Inc.; Norman D. Schuneman, Senior Vice President-
Lending, Brenton Banks, Inc.; and Roger D. Winterhof, President & CEO,
Brenton National Bank-Poweshiek County, Grinnell.
Other. The information appearing on pages 2 through 8 of the
Company's Annual Report to Stockholders for the year ended December 31, 1994
(the "Annual Report") filed as Exhibit 13, is incorporated by reference.
(C) Affiliated Banks.
The 14 affiliated banks had 44 banking locations at December 31,
1994, located in 12 of Iowa's 99 counties. These banks serve both
agricultural and metropolitan areas. The location and certain other
information about the affiliated banks are given below:
Brenton Bank, N.A., Des Moines is located in the Des Moines, Iowa,
metropolitan area. Des Moines is the largest city in Iowa and the population
of the metropolitan area is approximately 406,000. In addition to their main
banking office, Brenton Bank, N.A., Des Moines has eight offices. All of
these offices are located in the Des Moines metropolitan area.
Brenton Bank and Trust Company, Adel, is located in Adel, Iowa.
The bank has offices in Dexter, Redfield and Van Meter, Iowa. Brenton State
Bank, Dallas Center, is located in Dallas Center, Iowa and has offices in
Granger, Woodward and Waukee, Iowa. These two affiliated banks service cus-
tomers in parts of Polk, Dallas, Madison, Adair, Guthrie, and Boone counties.
Warren County Brenton Bank and Trust is located in Indianola, Iowa,
and services customers in parts of Polk, Warren, Madison, Marion, Lucas and
Clarke counties.
Brenton National Bank of Perry is located in Perry, Iowa and
services parts of Dallas, Boone, Guthrie and Greene counties.
Brenton State Bank of Jefferson is located in Jefferson, Iowa.
This affiliated bank services customers in Greene County.
Brenton Bank of Palo Alto County is located in Emmetsburg, Iowa and
has offices in Mallard and Ayrshire, Iowa. This affiliated bank services
Palo Alto County.
Brenton Bank and Trust Company, Clarion, is located in Clarion,
Iowa, and has offices in Eagle Grove and Rowan, Iowa. This affiliated bank
services customers in parts of Wright, Humboldt and Webster counties.
Brenton First National Bank, Davenport, is located in Davenport,
Iowa and services customers in the Quad-Cities metropolitan area with a
population of approximately 357,000. The bank has four offices in the
Davenport metropolitan area.
Brenton National Bank-Poweshiek County is located in Grinnell, Iowa
and services parts of Poweshiek and Jasper counties.
Brenton Bank and Trust Company, Marshalltown, Iowa is located in
Marshalltown, Iowa and has one office in Marshalltown and one office in
Albion, Iowa. The bank services customers in Marshall County.
Brenton Bank and Trust Company of Cedar Rapids is located in Cedar
Rapids, Iowa and services customers in Linn County, population of
approximately 173,000. The bank has four offices in Cedar Rapids and one
office in Marion, Iowa.
Brenton Bank, N.A., Knoxville is located in Knoxville, Iowa. The
bank services customers of Marion County, south of the Des Moines river.
7
Brenton Savings Bank, FSB is located in Ames, Iowa and has offices
in Ames, Story City and Ankeny. The savings bank serves customers in Story
and Polk Counties.
At December 31, 1994, four of the affiliated banks owned and
operated insurance agencies handling group, fire, crop, homeowner's,
automobile and liability insurance. One of the affiliated banks operates
insurance agency activities through corporate subsidiaries and three of the
affiliated banks conduct the activities directly. In addition, two of the
affiliated banks own and operate real estate agencies. One of the affiliated
banks operates real estate agency activities through a corporate subsidiary,
while the other bank conducts the activities directly. The total commissions
from the insurance and real estate agencies are not substantial in relation
to total other receipts of any of the affiliated banks owning these agencies.
During 1994, 13 of the Company's subsidiary banks (excluding the
savings bank) established subsidiaries for the purpose of holding the
respective bank's investment portfolio. These wholly-owned subsidiaries hold
and manage the banks investment portfolios in Nevada and are not subject to
state taxation, as Nevada imposes no corporate income taxes.
(D) Bank-Related Subsidiaries and Affiliates.
Brenton Brokerage Services, Inc., a wholly owned subsidiary of
Brenton Bank, N.A., Des Moines, was formed in 1992 and provides a full array
of retail investment brokerage services to customers. The company is not
involved with the direct issuance, flotation or underwriting of securities.
At December 31, 1994, this subsidiary had 27 licensed brokers serving all
Brenton banks.
Brenton Bank Services Corporation, a bank services company owned by
the affiliated banks, provides centralized accounting, operations and
financial reporting services; and coordinates centralized proof services and
the computer processing services for the Company.
Brenton Mortgages, Inc., a wholly-owned subsidiary of the Parent
Company, engages in the mortgage banking business. This subsidiary services
numerous mortgage loans sold to institutional investors and the mortgage loan
portfolios of the affiliated banks.
Brenton Insurance Services, Inc., a wholly-owned subsidiary of the
Parent Company, provides insurance risk management services for the Company.
(E) Executive Officers of the Registrant.
The term of office for the executive officers of the Parent Company
is from the date of election until the next Annual Organizational Meeting of
the Board of Directors. The names and ages of the executive officers of the
Parent Company as of March 13, 1995, the Parent Company offices held by these
executive officers on that date, the period during which the executive
officers have served as such and the other positions held with the Company by
these officers during the past five years are set forth below and on the
following page:
Parent Company Position
Name and Address Age Position Commenced Other Positions
________________ ___ ________ _________ _______________
C. Robert Brenton 64 Chairman of the Board 1990 President of the Parent Company - prior to
Des Moines, Iowa May 1990
William H. Brenton 70 Chairman of the 1990 Chairman of the Board of the Parent Company -
Des Moines, Iowa Executive Committee prior to May 1990
and Vice Chairman of
the Board
8
Parent Company Position
Name and Address Age Position Commenced Other Positions
________________ ___ ________ _________ _______________
Robert L. DeMeulenaere 55 President 1994 President/Treasurer, Brenton Mortgages, Inc.
Des Moines, Iowa - August 1989 to July, 1994; CEO, Brenton Bank
and Trust Company of Cedar Rapids - August
1990 to January 1994; Senior Vice President
of the Parent Company - August 1990 to
January 1994; Senior Vice President-Metro
Bank Division of the Parent Company -
February 1986 to January 1990.
Phillip L. Risley 52 Executive Vice 1992 President and CEO, Brenton Bank, N.A.,
Des Moines, Iowa President Des Moines - February 1990 to present; Vice
President - Operations of the Parent
Company - May 1984 to January 1992;
Chairman of the Board, Brenton Bank
Services Corporation - May 1992 to present;
Executive Vice President/Treasurer, Brenton
Information Systems, Inc. - April 1990 to May
1992; President, Brenton Information
Systems, Inc. - prior to April 1990; President,
Brenton Bank, N.A., Des Moines - April 1988
to February 1990
Roger D. Winterhof 49 Senior Vice President 1984 Senior Vice President, Community Bank
Des Moines, Iowa Division - February 1986 to April 1994
Norman D. Schuneman 52 Senior Vice President - 1990 Executive Vice President, Brenton Bank, N.A.,
Des Moines, Iowa Lending Des Moines - July 1985 to present; Vice
President - Loans of the Parent Company -
January 1988 to January 1990
John R. Amatangelo 45 Senior Vice President - 1991 President, Brenton Bank Services Corporation
Des Moines, Iowa Operations/Technology - May 1992 to present
Steven T. Schuler 43 Chief Financial Officer/ 1990 Executive Vice President, Brenton Bank
Des Moines, Iowa Treasurer/Secretary 1986 Services Corporation - May 1992 to present
Gary D. Ernst 51 Vice President - Trust 1990
Charles N. Funk 40 Vice President - 1991
Investments
Steven F. Schneider 41 Vice President - 1990 President, Brenton Brokerage Services, Inc. -
Des Moines, Iowa Brokerage Services April 1993 to present
<FN>
All of the foregoing individuals have been employed by the Company for the past five years, except for Steven F. Schneider,
who was an Investment Representative of A.G. Edwards & Sons, Inc., Des Moines, Iowa, prior to February 1990; John R.
Amatangelo, who was Senior Vice President and Director of Operations of Ameritrust Indiana Corporation, Indianapolis,
Indiana, from May 1989 to August 1991; Gary D. Ernst, who was Senior Vice President/Senior Trust Officer of First National
Bank, Iowa City, Iowa, from November 1989 to June 1990; and Charles N. Funk, who was Senior Vice President, Bank and Trust
Investments of Union National Bank, Wichita, Kansas, from December 1984 to December 1991.
(F) Employees.
On December 31, 1994, the Parent Company had 57 full-time employees
and 5 part-time employees. On December 31, 1994, the Company had 686 full-
time employees and 213 part-time employees. None of the employees of the
Company are represented by unions. The relationship between management and
employees of the Company is considered good.
9
(G) Supervision and Regulation.
The Company is restricted by various regulatory bodies as to the
types of activities and businesses in which it may engage. References to the
provisions of certain statutes and regulations are only brief summaries
thereof and are qualified in their entirety by reference to those statutes
and regulations. The Parent Company cannot predict what other legislation
may be enacted or what regulations may be adopted, or, if enacted or adopted,
the effect thereof. Furthermore, certain regulatory and legislative changes
are discussed in Item 1, Section (B), Recent Developments.
The Parent Company, as a bank holding company, is subject to
regulation under the Bank Holding Company Act of 1956 (the "Act") and is
registered with the Board of Governors of the Federal Reserve System. Under
the Act, the Parent Company is prohibited, with certain exceptions, from
acquiring direct or indirect ownership or control of more than 5% of the
voting shares of any company which is not a bank and from engaging in any
business other than that of banking, managing and controlling banks or
furnishing services to its affiliated banks. However, the Parent Company may
engage in and may own shares of companies engaged in certain businesses found
by the Board of Governors to be so closely related to banking "as to be a
proper incident thereto." The Act does not place territorial restrictions on
the activities of bank-related subsidiaries of bank holding companies. The
Parent Company is required by the Act to file periodic reports of its
operations with the Board of Governors and is subject to examination by the
Board of Governors. Under the Act and the regulations of the Board of
Governors, bank holding companies and their subsidiaries are prohibited from
engaging in certain tie-in arrangements in connection with any extension of
credit or provision of any property or services.
As a savings and loan holding company, Brenton Banks, Inc. is
subject to federal regulation and examination by the Office of Thrift
Supervision (the "OTS"). The OTS has enforcement authority over the Company.
This authority permits the OTS to restrict or prohibit activities that are
determined to be a serious risk to the subsidiary savings institution.
Generally, the activities for a bank holding company are more limited than
the authorized activities for a savings and loan holding company.
The Parent Company, its affiliated banks and its bank-related
subsidiaries are affiliates within the meaning of the Federal Reserve Act and
OTS regulations. As affiliates, they are subject to certain restrictions on
loans by an affiliated bank to the Parent Company, other affiliated banks or
such other subsidiaries, on investments by an affiliated bank in their stock
or securities and on an affiliated bank taking such stock and securities as
collateral for loans to any borrower. The Company is also subject to certain
restrictions with respect to direct issuance, flotation, underwriting, public
sale or distribution of certain securities.
The five affiliated banks which are national banks are subject to
the supervision of and are regularly examined by the Comptroller of the
Currency. All other affiliated state banks are subject to the supervision of
and are regularly examined by the Iowa Superintendent of Banking and, because
of their membership in the Federal Deposit Insurance Corporation ("FDIC"),
are subject to examination by the FDIC. All banks are required to maintain
certain minimum capital ratios established by their primary regulators. The
provisions of The FDIC Improvement Act of 1991 ("FDICA") restrict the
activities that insured state chartered banks may engage in to those
activities that are permissible for national banks, except where the FDIC
determines that the activity poses no significant risk to the deposit
insurance fund and the bank remains adequately capitalized. Furthermore,
FDICIA grants the FDIC the power to take prompt regulatory action against
certain undercapitalized and seriously undercapitalized institutions in order
to preserve the deposit insurance fund.
The affiliated savings bank is subject to the supervision of and is
regularly examined by the OTS and FDIC. In addition to the fees charged by
the FDIC, the savings bank is assessed fees by the OTS based upon the
savings bank's total assets. As a savings institution, the savings bank is
a member of the Federal Home Loan Bank of Des Moines, must maintain certain
minimum capital ratios established by the OTS and is required to meet a
qualified thrift lender test (the "QTL") to avoid certain restrictions upon
its
10
operations. On December 31, 1994, Brenton Savings Bank, FSB, complied with
the current minimum capital guidelines and met the QTL test, which it has
always met since the test was implemented.
The Company operates within a regulatory structure that
continuously evolves. In the last several years, significant changes have
occurred that affect the Company. The material provisions of those changes
occurring prior to 1994 follow. See Item 1, Section (B), Recent
Developments, for those changes during 1994.
The FDIC Improvement Act of 1991 was primarily designed to
recapitalize the FDIC's Bank Insurance Fund ("BIF") and Savings Association
Insurance Fund ("SAIF"). To accomplish this purpose the FDIC was: (1)
granted additional borrowing authority; (2) granted the power to levy
emergency special assessments on all insured depository institutions; (3)
granted the right to change BIF and SAIF rates on deposits on a semiannual
basis; and (4) directed to draft regulations that would provide for "Risk-
Based Assessment System" by January 1994. FDICIA also imposed additional
regulatory standards upon depository institutions and granted additional
authority to the FDIC. FDICIA generally requires that all institutions be
examined by the FDIC annually. Under the provisions of FDICIA, all
regulatory authorities are required to examine their regulatory accounting
standards and, to the extent possible, are required to conform to Generally
Accepted Accounting Principles. Finally, FDICIA granted to the FDIC, under
certain circumstances, the authority to seek regulatory orders against banks
where necessary and when the banks' primary bank regulatory agency has
refused to act.
The Company's affiliated banks are assessed fees based on the
banks' deposits by the FDIC, to insure the funds of customers on deposit with
the banks. The deposits acquired from the Resolution Trust Corporation and
the deposits of the savings bank are insured by SAIF, while deposits of the
Company's subsidiary banks are insured by BIF. The FDIC has implemented the
"Risk-Based Assessment System" which is a system designed to assess higher
FDIC insurance premiums to those institutions that are more likely to result
in a loss to the deposit insurance fund. Currently, both BIF and SAIF
insured institutions are assessed premiums from $.23 to $.31 per $100 of
deposits. All Brenton banks currently pay an FDIC insurance premium rate of
$.23 per $100 of deposits, the lowest rate under the "Risk-Based Assessment
System". The FDIC has authority to change the base BIF and SAIF rates under
certain circumstances that are set forth in the law. The FDIC has recently
proposed to decrease the BIF insurance premiums assessed in 1995. See Item
1, Section (B), Recent Developments.
According to Iowa's regional interstate banking law, Iowa-based
banks and bank holding companies can acquire banks and bank holding companies
located in certain other states. Additionally, certain non-Iowa based banks
and bank holding companies can acquire Iowa banks and bank holding companies,
provided that the total deposits of all banks and savings and loan
associations (hereinafter "thrifts") controlled by out of state bank holding
companies does not exceed thirty-five percent of the total deposits of all
banks and thrifts in the state. The law allows regional interstate banking
between Iowa and Illinois, Minnesota, Missouri, Nebraska, South Dakota and
Wisconsin. See Item 1, Section (B), Recent Developments, for information on
the Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994.
Bank holding companies and banks may acquire thrifts in any state,
regardless of whether the acquiror can operate a bank in that state. Such
thrifts must conform their activities to those that are permissible for banks
or bank holding companies and their subsidiaries.
In the first quarter of 1990, an Iowa law was enacted suspending
the application of Iowa Banking Law prohibitions against branch banking with
respect to the acquisition of troubled thrifts. This law was extended during
the second quarter of 1994. The suspension of these prohibitions allows
Iowa-based banks and bank holding companies to acquire thrifts in
contravention of existing branch banking restrictions until July 1, 1995.
Generally, banks in Iowa are prohibited from operating offices in
counties other than the county in which the bank's principal office is
located and contiguous counties. However, certain banks located in the same
or different municipalities or urban complexes may consolidate or merge and
retain their existing
11
banking locations by converting to a United Community Bank. The resulting
bank would adopt one principal place of business, and would retain the
remaining banking locations of the merged or consolidated banks as offices.
The Company relied upon the United Community Bank law when it merged Brenton
National Bank, Des Moines and Brenton Bank and Trust, Urbandale to form
Brenton Bank, N.A., Des Moines. The Company will also rely on this law when
it merges its commercial banks in 1995. Generally, thrifts can operate
offices in any county in Iowa and may, under certain circumstances, acquire
or branch into thrifts in other states with the approval of the OTS.
(H) Governmental Monetary Policy and Economic Conditions.
The earnings of the Company are affected by the policies of
regulatory authorities, including the Federal Reserve System. Federal
Reserve System monetary policies have had a significant effect on the
operating results of commercial banks in the past and are expected to
continue to do so in the future. Because of changing conditions in the
economy and in the money markets, as a result of actions by monetary and
fiscal authorities, interest rates, credit availability and deposit levels
may change due to circumstances beyond the control of the Company. Future
policies of the Federal Reserve System and other authorities cannot be
predicted, nor can their effect on future earnings be predicted.
(I) Competition.
The banking business in Iowa is highly competitive and the
affiliated banks compete not only with banks and thrifts, but with sales,
finance and personal loan companies; credit unions; and other financial
institutions which are active in the areas in which the affiliated banks
operate. In addition, the affiliated banks compete for customer funds with
other investment alternatives available through investment brokers, insurance
companies, finance companies and other institutions.
The multi-bank holding companies which own banks in Iowa are in
direct competition with one another. The Company is one of the largest
multi-bank holding companies operating in Iowa based on deposit size. The
largest multi-bank holding company, which is domiciled in Minnesota, has 44
banking locations in various parts of Iowa. The total deposits of this
company's affiliated banks located in Iowa are approximately 270 percent
greater than the total deposits of the Company. Another multi-bank holding
company, domiciled in Wisconsin, has 43 locations in Iowa, and another multi-
bank holding company domiciled in Missouri, has 33 locations in Iowa.
Brenton Banks, Inc. is the second largest multi-bank holding
company domiciled in Iowa. The largest Iowa-based bank holding company has
64 banking locations in the state and deposits approximately 25 percent
greater than the deposits of the Company.
The third largest Iowa-based multi-bank holding company has 32
locations in Iowa and deposits approximately 29 percent less than those of
the Company.
Certain of the subsidiary banks of these multi-bank holding
companies may compete with certain of the Parent Company's affiliated banks
and any other affiliated financial institutions which may be acquired by the
Parent Company. These multi-bank holding companies, other smaller bank
holding companies, chain banking systems and others may compete with the
Parent Company for the acquisition of additional banks.
The Company has also expanded into the related investment brokerage
business in the last several years, placing brokers in many Brenton bank
locations. The Brenton brokers in small communities compete with brokers
from regional and national investment brokerage firms.
12
Item 1(J) Business - Statistical Disclosure
The following statistical disclosures relative to the consolidated
operations of the Company have been prepared in accordance with Guide 3 of
the Guides for the Preparation and Filing of Reports and Registration
Statements under the Securities Exchange Act of 1934. Average balances were
primarily calculated on a daily basis.
I. Distribution of Assets, Liabilities, and Stockholders' Equity;
Interest Rates and Interest Differential
The following summarizes the average consolidated statement of
condition by major type of account, the interest earned and interest paid and
the average yields and average rates paid for each of the three years ending
December 31, 1994:
1994 1993 1992
______________________________ ______________________________ ______________________________
Interest Average Interest Average Interest Average
Average Income or Yields or Average Income or Yields or Average Income or Yields or
Balance Expense Rates Balance Expense Rates Balance Interest Rates
__________ _________ _________ __________ _________ _________ __________ _________ _________
(Dollars in thousands)
Assets:
Interest-earning assets
Loans (1,2) $ 936,370 $ 76,271 8.14% $ 802,088 $ 70,310 8.77% $ 736,646 $ 71,077 9.65%
Investment securities held to
maturity:
Taxable investments:
United States Treasury
securities -- -- -- 24,598 1,290 5.24 81,606 5,282 6.47
Securities of United States
government agencies 2,001 98 4.92 58,522 3,410 5.83 102,196 7,128 6.98
Mortgage-backed and related
securities 29,834 1,679 5.63 204,130 10,857 5.32 170,480 11,931 7.00
Other investments 3,959 85 2.15 12,743 1,071 8.41 30,019 2,098 6.99
Tax-exempt investments:
Obligations of states and
political subdivisions(2) 44,584 3,433 7.70 164,520 11,471 6.97 139,296 10,665 7.66
Investment securities available
for sale:
United States Treasury
securities 55,580 2,519 4.53 44,605 2,315 5.19 6,512 459 7.05
Securities of United States
government agencies 58,603 3,016 5.15 8,439 486 5.76 -- -- --
<FN>
(1) The average outstanding balance is net of unearned income and includes nonaccrual loans.
(2) Interest income and yields are stated on a tax equivalent basis using a 34 percent federal income tax rate for 1994 and
1992 and 35 percent rate for 1993, and are adjusted to reflect the effect of the nondeductible interest expense of owning tax-
exempt investments. The standard federal income tax rate is used for consistency of presentation.
13
Item 1(J) Business - Statistical Disclosure, Continued
I. Distribution of Assets, Liabilities, and Stockholders' Equity;
Interest Rates and Interest Differential, Continued
1994 1993 1992
______________________________ ______________________________ ______________________________
Interest Average Interest Average Interest Average
Average Income or Yields or Average Income or Yields or Average Income or Yields or
Balance Expense Rates Balance Expense Rates Balance Interest Rates
__________ _________ _________ __________ _________ _________ __________ _________ _________
(Dollars in thousands)
Mortgage-backed and related
securities 124,591 6,864 5.51 -- -- -- -- -- --
Other investments 7,255 641 8.87 130 8 6.00 -- -- --
Tax-exempt investments:
Obligations of states and
political subdivisions 132,040 8,412 6.37 -- -- -- -- -- --
Loans held for sale 2,575 193 7.50 6,165 520 8.43 2,553 238 9.33
Federal funds sold and
securities purchased under
agreements to resell 37,666 1,706 4.53 23,725 486 2.05 27,082 654 2.41
Interest-bearing deposits
with banks 124 8 6.65 762 22 2.88 6,240 307 4.92
_________ _______ ____ _________ _______ ____ _________ _______ ____
Total interest-earning assets(1) 1,435,182 $104,925 7.31% 1,350,427 $102,246 7.57% 1,302,630 $109,839 8.43%
Allowance for loan losses (10,502) (9,615) (8,894)
Cash and due from banks 46,301 46,025 41,715
Bank premises and equipment 24,545 23,045 21,400
Other assets 25,663 26,543 30,422
_________ _________ _________
Total assets $1,521,189 $1,436,425 $1,387,273
<FN>
(1) Interest income and yields are stated on a tax equivalent basis using a 34 percent federal income tax rate for 1994 and
1992 and 35 percent rate for 1993, and are adjusted to reflect the effect of the nondeductible interest expense of owning tax-
exempt investments. The standard federal income tax rate is used for consistency of presentation.
14
Item 1(J) Business - Statistical Disclosure, Continued
I. Distribution of Assets, Liabilities, and Stockholders' Equity;
Interest Rates and Interest Differential, Continued
1994 1993 1992
______________________________ ______________________________ ______________________________
Interest Average Interest Average Interest Average
Average Income or Yields or Average Income or Yields or Average Income or Yields or
Balance Expense Rates Balance Expense Rates Balance Expense Rates
_________ __________ _________ __________ _________ _________ __________ _________ _________
(Dollars in thousands)
Liabilities and stockholders'
equity:
Interest-bearing liabilities:
Interest-bearing deposits:
Demand $ 250,520 $ 5,418 2.16% $ 217,754 $ 4,552 2.09% $ 209,642 $ 5,277 2.52%
Savings 294,715 6,878 2.33 299,640 7,697 2.57 260,568 9,385 3.60
Time 625,981 29,313 4.68 622,789 29,940 4.81 646,261 37,781 5.85
Federal funds purchased and
securities sold under
agreements to repurchase 61,656 2,082 3.38 42,715 1,027 2.41 33,240 924 2.78
Other short-term borrowings 4,860 264 5.42 33 1 3.62 2,170 121 5.57
Long-term borrowings 26,500 1,817 6.86 14,077 1,210 8.60 14,067 1,285 9.14
_________ ______ ____ _________ ______ ____ _________ ______ ____
Total interest-bearing
liabilities 1,264,232 $45,772 3.62% 1,197,008 $44,427 3.71% 1,165,948 $54,773 4.70%
Noninterest-bearing deposits 127,464 119,322 112,054
Accrued expenses and other
liabilities 13,254 12,805 13,735
_________ _________ _________
Total liabilities 1,404,950 1,329,135 1,291,737
Minority interest 4,290 4,150 3,845
Common stockholders' equity 111,949 103,140 91,691
_________ _________ _________
Total liabilities and
stockholders' equity $1,521,189 $1,436,425 $1,387,273
Net interest spread (1) 3.69% 3.86% 3.73%
Net interest income/margin (1) $59,153 4.12% $57,819 4.28% $55,066 4.23%
<FN>
(1) Interest income and yields are stated on a tax equivalent basis using a 34 percent federal income tax rate for 1994 and 1992,
and a 35 percent rate for 1993, and are adjusted to reflect the effect of the nondeductible interest expense of owning tax-exempt
investments. The standard federal income tax rate is used for consistency of presentation.
15
Item 1(J) Business - Statistical Disclosure, Continued
I. Distribution of Assets, Liabilities, and Stockholders' Equity;
Interest Rates and Interest Differential, Continued
The following shows the changes in interest earned and interest
paid due to changes in volume and changes in rate for each of the two years
ended December 31, 1994:
1994 vs. 1993 1993 vs. 1992
__________________________ __________________________
Variance Variance
due to due to
_______________ _______________
Variance Volume Rate Variance Volume Rate
________ ______ ____ ________ ______ ____
(In thousands) (In thousands)
Interest Income:
Loans (1,2) $ 5,961 11,185 (5,224) $ (767) 6,030 (6,797)
Investment securities held
to maturity:
Taxable investments:
United States Treasury securities (1,290) (1,290) -- (3,992) (3,139) (853)
Securities of United States government
agencies (3,312) (2,843) (469) (3,718) (2,684) (1,034)
Mortgage-backed and related
securities (9,178) (9,775) 597 (1,074) 2,100 (3,174)
Other investments (986) (474) (512) (1,027) (1,388) 361
Tax-exempt investments:
Obligations of states and political
subdivisions (2) (8,038) (9,126) 1,088 806 1,816 (1,010)
Investment securities available
for sale:
Taxable Investments:
United States Treasury securities 204 522 (318) 1,856 1,969 (113)
Securities of United States government
agencies 2,530 2,587 (57) 486 516 (30)
Mortgage-backed and related securities 6,864 6,864 -- -- -- --
Other investments 633 628 5 8 8 --
Tax-exempt Investments:
Obligations of states and political
subdivisions (2) 8,412 8,412 -- -- -- --
Loans held for sale (327) (275) (52) 282 307 (25)
Federal funds sold and securities purchased
under agreements to resell 1,220 399 821 (168) (76) (92)
Interest-bearing deposits with banks (14) (28) 14 (285) (194) (91)
______ _____ ______ ______ _____ ______
2,679 6,786 (4,107) (7,593) 5,265 (12,858)
_____ _____ ______ _______ _____ ______
Interest expense:
Interest-bearing deposits:
Demand 866 704 162 (725) 198 (923)
Savings (820) (125) (695) (1,688) 1,269 (2,957)
Time (626) 153 (779) (7,841) (1,331) (6,510)
Federal funds purchased and securities sold
under agreements to repurchase 1,055 552 503 103 239 (136)
Other short-term borrowings 4 6 (2) (120) (82) (38)
Long-term borrowings 866 1,082 (216) (75) 1 (76)
______ _____ ______ ______ _____ ______
1,345 2,372 (1,027) (10,346) 294 (10,640)
______ _____ ______ ______ _____ ______
Net interest income (expense) $ 1,334 4,414 (3,080) $ 2,753 4,971 (2,218)
______ _____ ______ ______ _____ ______
Note: The change in interest due to both rate and volume has been allocated
to change due to volume and change due to rate in proportion to the
relationship of the absolute dollar amounts of the change in each.
<FN>
(1) Nonaccrual loans have been included in the analysis of volume and rate variances.
(2) Computed on tax equivalent basis using a 34 percent federal income tax rate for 1994 and 1992 and a 35 percent rate
for 1993, and adjusted to reflect the effect of the nondeductible interest expense of owning tax-exempt investments.
16
Item 1(J) Business - Statistical Disclosure, Continued
I. Distribution of Assets, Liabilities, and Stockholders' Equity;
Interest Rates and Interest Differential, Continued
Interest Rate Sensitivity Analysis
The following schedule shows the matching of interest sensitive
assets to interest sensitive liabilities by various maturity or repricing
periods as of December 31, 1994. As the schedule shows, the Company is
liability sensitive within the one-year time frame. Included in the three
months or less sensitivity category are all interest-bearing demand and
savings accounts. Although these deposits are contractually subject to
immediate repricing, management believes a large portion of these accounts
are not synchronized with overall market rate movements.
3 Months Over 3 Over 6 Total Over 1
or through 6 through 12 within through 5 Over
Less Months Months 1 Year Years 5 Years Total
---- ------ ------ ------ ----- ------- -----
(In thousands)
Interest-earning assets:
Loans (1) $ 200,835 34,917 49,213 284,965 499,466 181,999 966,430
Investment securities:
Available for sale:
Taxable investments 79,198 25,163 37,598 141,959 88,718 934 231,611
Tax-exempt investments 8,255 15,101 10,884 34,240 55,540 27,818 117,598
Held to maturity:
Taxable investments 21,396 2,915 6,266 30,577 14,560 2,676 47,813
Tax-exempt investments 1,707 5,585 12,759 20,051 18,351 8,269 46,671
Loans held for sale 2,104 -- -- 2,104 -- -- 2,104
Federal funds sold and securities purchased under
agreements to resell 59,396 -- -- 59,396 -- -- 59,396
Interest-bearing deposits with banks 64 -- -- 64 -- -- 64
_______ _______ _______ _______ _______ _______ _________
Total interest-earning assets $ 372,955 83,681 116,720 573,356 676,635 221,696 1,471,687
_______ _______ _______ _______ _______ _______ _________
Interest-bearing liabilities:
Interest-bearing deposits:
Demand and savings deposits (2) $ 570,415 -- -- 570,415 -- -- 570,415
Time deposits 107,218 89,080 121,587 317,885 314,017 1,418 633,320
Federal funds purchased and securities sold under
agreements to repurchase 70,704 -- -- 70,704 -- -- 70,704
Other short-term borrowings 5,000 -- 7,000 12,000 -- -- 12,000
Long-term borrowings 0 -- 105 105 22,824 6,010 28,939
_______ _______ _______ _______ _______ _______ _________
Total interest-bearing liabilities $ 753,337 89,080 128,692 971,109 336,841 7,428 1,315,378
_______ _______ _______ _______ _______ _______ _________
Interest sensitivity GAP $(380,382) (5,399) (11,972) (397,753) 339,794 214,268 156,309
_______ _______ _______ _______ _______ _______ _________
Interest sensitivity GAP ratio .50:1 .94:1 .91:1 .59:1 2.01:1 29.85:1 1.12:1
_______ _______ _______ _______ _______ _______ _________
Cumulative interest sensitivity GAP $(380,382) (385,781) (397,753) (397,753) (57,959) 156,309 156,309
_______ _______ _______ _______ _______ _______ _________
Cumulative interest sensitivity GAP ratio .50:1 .54:1 .59:1 .59:1 .96:1 1.12:1 1.12:1
_______ _______ _______ _______ _______ _______ _________
<FN>
(1) Nonaccrual loans have been excluded from the interest rate sensitivity analysis.
(2) Interest-bearing demand and savings deposits are included in the 3 months or less sensitivity category.
17
Item 1(J) Business - Statistical Disclosure, Continued
II. Investment Portfolio
The carrying value of investment securities at December 31 for each
of the past three years follows:
Amortized Cost at December 31,
______________________________
1994 1993 1992
____ ____ ____
(In thousands)
<s)
Investment securities available for sale:
Taxable investments:
United States Treasury securities $ 50,641 63,777 28,878
Securities of United States government agencies 66,037 59,181 --
Mortgage-backed and related securities 104,121 138,744 1,166
Other investments 10,812 5,925 --
Tax-exempt investments:
Obligations of states and political subdivisions 117,598 144,583 --
_______ _______ _______
349,209 412,210 30,044
_______ _______ _______
Investment securities held to maturity:
Taxable investments:
United States Treasury securities -- -- 55,586
Securities of United States government agencies 9,444 -- 67,324
Mortgage-backed and related securities 35,282 24,882 225,659
Other investments 3,087 5,563 11,769
Tax-exempt investments:
Obligations of states and political subdivisions 46,671 35,939 150,639
_______ _______ _______
94,484 66,384 510,977
_______ _______ _______
Total investment securities $443,693 478,594 541,021
_______ _______ _______
18
Item 1(J) Business - Statistical Disclosure, Continued
II. Investment Portfolio
The following table shows the maturity distribution and weighted
average yields of investment securities at December 31, 1994:
(caption>
Investments by Maturity and Yields at December 31, 1994
____________________________________________________________________________
After One After Five
Within but through but through After
One Year Five Years Ten Years Ten Years
_______________ _______________ _______________ _______________
Amount Yield Amount Yield Amount Yield Amount Yield
______ _____ ______ _____ ______ _____ ______ _____
(Dollars in thousands)
Investment securities available for sale:
Taxable investments:
United States Treasury
securities $ 44,298 4.11% $ 5,337 4.86% $ 1,006 4.29% $ -- --%
Securities of United States
government agencies 28,537 5.41 28,132 5.38 9,368 5.14 -- --
Mortgage-backed and
related securities 24,225 5.97 74,646 5.69 5,112 7.07 138 7.50
Other investments 3,071 4.54 3,228 5.80 -- -- 4,513 7.67
Tax-exempt investments:
Obligations of states and
political subdivisions 33,125 5.89 41,811 6.89 15,954 9.70 26,708 8.70
_______ ____ _______ ____ ______ ____ ______ ____
133,256 5.18 153,154 5.93 31,440 7.74 31,359 8.55
_______ ____ _______ ____ ______ ____ ______ ____
Investment securities held to maturity:
Taxable investments:
Securities of United States
government agencies 1,795 5.82 7,649 5.53 -- -- -- --
Mortgage-backed and
related securities 8,551 6.42 19,504 6.64 3,367 5.68 3,860 5.60
Other investments 1,350 6.10 977 4.84 120 6.27 640 7.11
Tax-exempt investments:
Obligations of states and
olitical subdivisions 17,638 6.21 18,296 6.64 4,565 7.83 6,172 8.70
_______ ____ _______ ____ ______ ____ ______ ____
29,334 6.24 46,426 6.42 8,052 6.91 10,672 7.48
_______ ____ _______ ____ ______ ____ ______ ____
Total investment securities $162,590 5.55% $199,580 6.12% $39,492 7.60% $42,031 8.28%
_______ ____ _______ ____ ______ ____ ______ ____
NOTE: The weighted average yields are calculated on the basis of the cost
and effective yields for each scheduled maturity group. The weighted average
yields for tax-exempt obligations have been adjusted to a fully taxable
basis, assuming a 34 percent federal income tax rate for 1994 and 1992 and a
35 percent rate for 1993, and are adjusted to reflect the effect of the
nondeductible interest expense of owning tax-exempt investments.
As of December 31, 1994, the Company did not have securities from a single
issuer, other than the United States Government or its agencies, which
exceeded 10 percent of consolidated common stockholders' equity.
Maturities of all investment securities are managed to meet the Company's
normal liquidity needs. Investment securities available for sale may be sold
prior to maturity to meet liquidity needs, to respond to market changes or to
adjust the Company's asset/liability position.
19
Item 1(J) Business - Statistical Disclosure, Continued
III. Loan Portfolio
The following table shows the amount of loans outstanding by type
as of December 31 for each of the past five years:
December 31
____________________________________________________
1994 1993 1992 1991 1990
____ ____ ____ ____ ____
(In thousands)
1. Real estate loans:
a. Commercial construction and land development $ 26,549 24,189 25,180 16,155 16,319
b. Secured by 1-4 family residential property 389,713 349,810 324,124 321,721 315,934
c. Other 143,960 129,574 101,418 96,805 88,572
2. Loans to financial institutions (primarily bankers'
acceptances) -- -- 393 4,785 9,969
3. Loans to farmers 71,853 66,574 62,471 60,898 55,856
4. Commercial and industrial loans 115,280 90,521 75,062 93,180 67,575
5. Loans to individuals for personal expenditures,
net of unearned income 221,627 214,401 163,876 151,529 151,261
6. All other loans 1,232 812 930 6,837 1,832
_______ _______ _______ _______ _______
$970,214 875,881 753,454 751,910 707,318
_______ _______ _______ _______ _______
20
Item 1(J) Business - Statistical Disclosure, Continued
III. Loan Portfolio, Continued
The following table shows the maturity distribution of loans as of
December 31, 1994 (excluding real estate loans secured by 1-4 family
residential property and loans to individuals for personal expenditures):
Loans by Maturity at December 31, 1994
________________________________________
After One
Year
Within through After Five
One Year Five Years Years Total
________ __________ _____ _____
(In thousands)
1. Real estate loans:
a. Commercial construction and land development $ 21,359 3,717 1,473 26,549
b. Other 38,187 60,202 45,571 143,960
2. Loans to financial institutions -- -- -- --
3. Loans to farmers 44,730 23,918 3,205 71,853
4. Commercial and industrial loans 71,290 36,575 7,415 115,280
5. All other loans 1,196 27 9 1,232
_______ _______ ______ _______
$176,762 124,439 57,673 358,874
_______ _______ ______ _______
The above loans due after one year which have predetermined and
floating interest rates follow:
Predetermined interest rates $122,965
______
Floating interest rates $ 59,147
______
21
Item 1(J) Business - Statistical Disclosure, Continued
III. Loan Portfolio, Continued
The following schedule shows the dollar amount of loans at December
31 for each of the past five years which were either accounted for on a
nonaccrual basis, had been restructured to below market terms to provide a
reduction or deferral of interest or principal, or were 90 days or more past
due as to interest or principal. Each particular loan has been included in
only the most appropriate category.
1994 1993 1992 1991 1990
____ ____ ____ ____ ____
(In thousands)
Nonaccrual $3,784 1,605 1,884 2,931 2,391
Restructured 298 323 448 1,019 1,063
Past due 90 days or more 940 2,085 2,261 1,672 2,006
_____ _____ _____ _____ _____
Nonperforming loans $5,022 4,013 4,593 5,622 5,460
_____ _____ _____ _____ _____
Interest income recorded during 1994 on nonaccrual and restructured
loans amounted to $321,000. The amount of interest income which would have
been recorded during 1994 if nonaccrual and restructured loans had been
current, in accordance with the original terms, was $537,000.
The amounts scheduled above include the entire balance of any
particular loan. Much of the scheduled amount is adequately collateralized,
and thus does not represent the amount of anticipated charge-offs in the
future. The loans scheduled are representative of the entire customer base
of the Company and, therefore, are not concentrated in a specific industry or
geographic area other than the loans to farmers in Iowa. Overdrafts are
loans for which interest does not normally accrue. Since overdrafts are
generally low volume, they were not included in the above schedule, unless
there was serious doubt concerning collection.
The accrual of interest income is stopped when the ultimate
collection of a loan becomes doubtful. A loan is placed on nonaccrual status
when it becomes 90 days past due, unless it is both well secured and in the
process of collection. Once determined uncollectible, previously accrued
interest is charged to the allowance for loan losses.
In addition to the loans scheduled above, management has identified
other loans which, due to a change in economic circumstances or a
deterioration in the financial position of the borrower, present serious
concern as to the ability of the borrower to comply with present repayment
terms. Additionally, management considers the identification of loans
classified for regulatory or internal purposes as loss, doubtful, substandard
or special mention. This serious concern may eventually result in certain of
these loans being classified in one of the above scheduled categories. At
December 31, 1994, these loans amounted to approximately $2 million.
As of December 31, 1994, management is unaware of any other
material interest-earning assets which have been placed on a nonaccrual
basis, have been restructured, or are 90 days or more past due. The amount
of other real estate owned, which has been received in lieu of loan
repayment, amounted to $541,000 and $948,000 at December 31, 1994 and 1993,
respectively.
22
Item 1(J) Business - Statistical Disclosure, Continued
IV. Summary of Loan Loss Experience
The following is an analysis of the allowance for loan losses for
years ended December 31, for each of the past five years:
Year Ended December 31
_______________________________________________
1994 1993 1992 1991 1990
____ ____ ____ ____ ____
(In thousands)
Total loans at the end of the year $970,214 875,881 753,454 751,910 707,318
Average loans outstanding 936,370 802,088 736,646 727,870 659,283
_______ _______ _______ _______ _______
Allowance for loan losses -
beginning of the year $ 9,818 9,006 8,548 8,871 8,431
_______ _______ _______ _______ _______
Amount of charge-offs during year:
Real estate loans 83 109 276 110 203
Loans to financial institutions -- -- -- -- --
Loans to farmers 31 68 45 48 90
Commercial and industrial loans 337 54 252 769 455
Loans to individuals for personal expenditures 1,943 1,230 1,304 1,404 1,011
All other loans 48 70 67 5 8
_______ _______ _______ _______ _______
Total charge-offs 2,442 1,531 1,944 2,336 1,767
_______ _______ _______ _______ _______
Amount of recoveries during year:
Real estate loans 101 101 32 60 38
Loans to financial institutions -- -- -- -- --
Loans to farmers 146 81 179 135 130
Commercial and industrial loans 334 248 125 303 505
Loans to individuals for personal expenditures 947 641 635 716 280
All other loans 21 20 20 -- --
_______ _______ _______ _______ _______
Total recoveries 1,549 1,091 991 1,214 953
_______ _______ _______ _______ _______
Net loans charged off during year 893 440 953 1,122 814
_______ _______ _______ _______ _______
Additions to allowance charged to operating expense 1,988 1,252 1,411 799 869
_______ _______ _______ _______ _______
Allowance of acquisitions -- -- -- -- 385
_______ _______ _______ _______ _______
Allowance for loan losses - end of the year $ 10,913 9,818 9,006 8,548 8,871
_______ _______ _______ _______ _______
Ratio of allowance to loans outstanding at end of year 1.12% 1.12 1.20 1.14 1.25
____ ____ ____ ____ ____
Ratio of net charge-offs to average loans outstanding .10% .05 .13 .15 .12
___ ___ ___ ___ ___
NOTE: The provision for loan losses charged to operating expenses is based
on management's evaluation of the loan portfolio, past loan loss experience
and other factors that deserve current recognition in estimating loan losses.
The allowance for loan losses is maintained at a level necessary to support
management's evaluation of potential losses in the loan portfolio, after
considering various factors including prevailing and anticipated economic
conditions.
23
Item 1(J) Business - Statistical Disclosure, Continued
IV. Summary of Loan Loss Experience, Continued
In the following summary, the Company has allocated the allowance
for loan losses, according to the amount deemed to be reasonably necessary to
provide for losses within each category of loans. The amount of the
allowance applicable to each category and the percentage of loans in each
category to total loans follows:
Year Ended December 31
__________________________________________________________________________________________
1994 1993 1992 1991 1990
_________________ _________________ _________________ _________________ __________________
Allowance Percent Allowance Percent Allowance Percent Allowance Percent Allowance Percent
for of Loans for of Loans for of Loans for of Loans for of Loans
Loan to Total Loan to Total Loan to Total Loan to Total Loan to Total
Losses Loans Losses Loans Losses Loans Losses Loans Losses Loans
______ _____ ______ _____ ______ _____ ______ _____ _____ _____
(Dollars in thousands)
Real estate loans $ 2,600 57.7% $2,400 57.5% $2,200 59.8% $2,002 57.8% $1,967 59.5%
Loans to financial institutions -- -- -- -- -- .1 -- .6 -- 1.4
Loans to farmers 1,400 7.4 1,600 7.6 1,200 8.3 1,500 8.1 1,900 7.9
Commercial and industrial loans 2,800 11.9 2,700 10.3 2,700 10.0 2,600 12.4 3,000 9.6
Loans to individuals for personal
expenditures 4,113 22.8 3,118 24.5 2,906 21.3 2,446 20.2 2,004 21.4
All other loans -- .2 -- .1 -- .5 -- .9 -- .2
_______ _____ _____ _____ _____ _____ _____ _____ _____ _____
$10,913 100.0% $9,818 100.0% $9,006 100.0% $8,548 100.0% $8,871 100.0%
______ _____ _____ _____ _____ _____ _____ _____ _____ _____
24
Item 1(J) Business - Statistical Disclosure, Continued
V. Deposits
A classification of the Company's average deposits and average
rates paid for the years indicated follows:
Year Ended December 31
1994 1993 1992
Amount Rate Amount Rate Amount Rate
(Dollars in thousands)
Noninterest-bearing deposits $ 127,464 --% $ 119,322 --% $ 112,054 --%
Interest-bearing deposits:
Demand 250,520 2.16 217,754 2.09 209,642 2.52
Savings 294,715 2.33 299,640 2.57 260,568 3.60
Time 625,981 4.68 622,789 4.81 646,261 5.85
_________ ____ _________ ____ _________ ____
$1,298,680 $1,259,505 $1,228,525
_________ _________ _________
The following sets forth the maturity distribution of all time
deposits of $100,000 or more as of December 31, 1994:
Large Time Deposits
by Maturity at
Maturity Remaining December 31, 1994
(In thousands)
Less than 3 months $23,139
Over 3 through 6 months 10,191
Over 6 through 12 months 16,831
Over 12 months 23,188
______
$73,349
______
VI. Return on Equity and Assets
Various operating and equity ratios for the years indicated are
presented below:
Year Ended December 31,
________________________
1994 1993 1992
____ ____ ____
Return on average total assets:
Net income before deduction of minority interest .70% 1.04% .98%
Return on average equity 9.03 13.82 14.13
Common dividend payout ratio 34.65 22.22 21.00
Average equity to average assets 7.36 7.18 6.61
Equity to assets ratio 6.98 7.59 6.81
Tier 1 leverage capital ratio 7.23 7.36 6.71
Primary capital ratio 8.18 8.31 7.67
____ ____ ____
25
Item 1(J) Business - Statistical Disclosure, Continued
VII. Short-Term Borrowings
Information relative to federal funds purchased and securities sold
under agreements to repurchase follows:
1994 1993 1992
____ ____ ____
(Dollars in thousands)
Amount outstanding at December 31 $70,704 37,664 34,882
Weighted average interest rate at
December 31 4.73% 2.31 2.34
Maximum amount outstanding at any
quarter-end $70,704 66,740 49,125
Average amount outstanding during
the year $61,656 42,715 33,240
Weighted average interest rate during
the year 3.38% 2.41 2.78
______ ______ ______
Information relative to other short-term borrowings, which consist
primarily of notes payable by the Parent Company, Federal Reserve Bank
borrowings and U.S. Treasury - tax depository note options, follows:
1994 1993 1992
____ ____ ____
(Dollars in thousands)
Amount outstanding at December 31 $12,000 -- 120
Weighted average interest rate at
December 31 5.40% -- 3.15
Maximum amount outstanding at any
quarter-end $12,000 -- 2,840
Average amount outstanding during
the year $ 4,860 33 2,170
Weighted average interest rate during
the year 5.42% 3.63 5.57
______ ______ ______
26
Item 2. Properties.
At December 31, 1994, the affiliated banks had 44 banking locations
with approximately 296,000 square feet, all located in Iowa. Of these
banking locations, 33 were owned by the Company - approximately 229,000
square feet; 3 were owned buildings on leased land - approximately 30,000
square feet and 8 were operated under lease contracts with unaffiliated
parties - approximately 37,000 square feet.
The Company leases certain real estate and equipment under long-
term and short-term leases. The Company owns certain real estate which is
leased to unrelated persons.
Item 3. Legal Proceedings.
The Company (Brenton Banks, Inc. and its subsidiaries) is involved
in various claims and legal actions arising in the ordinary course of
business. In the opinion of management, the ultimate disposition of these
matters will not have a material adverse effect on the Company's financial
position or results of operations.
Item 4. Submission of Matters to a Vote of Security Holders.
There were no matters submitted during the fourth quarter of the
fiscal year covered by this report to a vote of security holders, through the
solicitation of proxies or otherwise.
PART II
Item 5. Market for the Registrant's Common Equity and Related Stockholder
Matters.
The information appearing on pages 30 and 37 of the Corporation's
Annual Report, filed as Exhibit 13 hereto, is incorporated herein by
reference.
There were approximately 1,608 holders of record of the Parent
Company's $5 common stock as of March 13, 1995. The closing bid price of the
Parent Company's common stock was $17.75 on March 13, 1995.
The Parent Company increased dividends to common shareholders in
1993 to $.44 per share, a 10 percent increase over $.40 for 1993, after
restatement for the May 1994 3-for-2 stock split. Dividend declarations are
evaluated and determined by the Board of Directors on a quarterly basis. In
January 1995, the Board of Directors declared a dividend of $.11 per common
share. There are currently no restrictions on the Parent Company's present
or future ability to pay dividends.
Item 6. Selected Financial Data.
The information appearing on page 19 of the Company's Annual
Report, filed as Exhibit 13 hereto, is incorporated herein by reference.
Item 7. Management's Discussion and Analysis of Financial Condition and
Results of Operations.
The information appearing on pages 12 through 17 of the Company's
Annual Report, filed as Exhibit 13 hereto, is incorporated herein by
reference.
27
Item 8. Financial Statements and Supplementary Data.
The information appearing on pages 20 through 36 of the Company's
Annual Report, filed as Exhibit 13 hereto, is incorporated herein by
reference.
Item 9. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure.
Within the twenty-four months prior to the date of the most recent
financial statements, there has been no change of accountants of the Company.
PART III
Item 10. Directors and Executive Officers of the Registrant.
The definitive proxy statement of Brenton Banks, Inc., which will
be filed not later than 120 days following the close of the Company's fiscal
year ending December 31, 1994, is incorporated herein by reference. See also
Item 1(E) of this Form 10-K captioned "Executive Officers of the Registrant."
Item 11. Executive Compensation.
The definitive proxy statement of Brenton Banks, Inc., which will
be filed not later than 120 days following the close of the Company's fiscal
year ended December 31, 1994, is incorporated herein by reference.
Item 12. Security Ownership of Certain Beneficial Owners and Management.
The definitive proxy statement of Brenton Banks, Inc., which will
be filed not later than 120 days following the close of the Company's fiscal
year ending December 31, 1994, is incorporated herein by reference.
Item 13. Certain Relationships and Related Transactions.
The definitive proxy statement of Brenton Banks, Inc., which will
be filed not later than 120 days following the close of the Company's fiscal
year ending December 31, 1994, is incorporated herein by reference.
PART IV
Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K.
The following exhibits and financial statement schedules are filed
as part of this report:
(a) 1. Financial Statements: See the financial statements on
pages 20 through 36 of the Company's Annual Report,
filed as Exhibit 13 hereto, which are incorporated by
reference herein.
2. Financial Statement Schedules: See Exhibits 11 and 12,
for computation of earnings per share and ratios.
28
3. Exhibits (not covered by independent auditors' report).
Exhibit 3
The Articles of Incorporation, as amended, and Bylaws,
as amended, of Brenton Banks, Inc. These Articles of
Incorporation and Bylaws are incorporated by reference
from Form 10-K of Brenton Banks, Inc., for the year
ended December 31, 1993.
Exhibit 10.1
Summary of the Bank Bonus Plans under which some of the
executive officers of the Parent Company and certain
other personnel of the subsidiaries are eligible to
receive a bonus each year.
Exhibit 10.2
Summary of the Executive Bonus Plan under which some of
the executive officers of the Parent Company are
eligible to receive a bonus each year.
Exhibit 10.3
Summary of the Trust Division Bonus Plan under which
one of the executive officers of the Parent Company is
eligible to receive a bonus each year.
Exhibit 10.4
Summary of the Brokerage Bonus Plan under which one of
the executive officers of the Parent Company is
eligible to receive a bonus each year.
Exhibit 10.5
Summary of the Employee Bonus Plan under which
employees of the Company are eligible to receive a
bonus each year.
Exhibit 10.6
Employment Agreement, dated July 6, 1989, between
William H. Brenton and Brenton Banks, Inc.
Exhibit 10.7
Non-Qualified Stock Option Plan, Administrative Rules
and Agreement under which officers of the Company are
eligible to receive options to purchase an aggregate of
300,000 shares of the Company's $5 par value common
stock. This Non-Qualified Stock Option Plan,
Administrative Rules and Agreement is incorporated by
reference from Form 10-K of Brenton Banks, Inc., for
the year ended December 31, 1992.
Exhibit 10.8
Long-Term Stock Compensation Plan, Agreements and
related documents, effective for 1994, under which
certain of the Company's senior officers and bank
presidents are eligible to receive shares of Brenton
Banks, Inc. stock based upon their service to the
Company and Company performance.
29
Exhibit 10.9
Long-Term Stock Compensation Plan, Agreements and
related documents, effective for 1993, under which
certain of the Company's senior officers and bank
presidents are eligible to receive shares of Brenton
Banks, Inc. stock based upon their service to the
Company and Company performance. This Long-Term Stock
Compensation Plan, Agreements and related documents are
incorporated by reference from Form 10-K of Brenton
Banks, Inc., for the year ended December 31, 1993.
Exhibit 10.10
Long-Term Stock Compensation Plan, Agreements and
related documents, effective for 1992, under which
certain of the Company's senior officers and bank
presidents are eligible to receive shares of Brenton
Banks, Inc. stock based upon their service to the
Company and Company performance. This Long-Term Stock
Compensation Plan, Agreements and related documents,
effective for 1992, are incorporated by reference from
Form 10-K of Brenton Banks, Inc., for the year ended
December 31, 1992.
Exhibit 10.11
Standard Agreement for Advances, Pledge and Security
Agreement between Brenton banks and the Federal Home
Loan Bank of Des Moines. These standard Agreement for
Advances, Pledge and Security Agreement are
incorporated by reference from Form 10-K of Brenton
Banks, Inc., for the year ended December 31, 1993.
Exhibit 10.12
Short-term note with American National Bank & Trust
Company of Chicago as of April 30, 1994, setting forth
the terms of the Parent Company's $2,000,000 short-term
debt agreement.
Exhibit 10.13
Data Processing Agreement dated December 1, 1991 by and
between Systematics, Inc. and Brenton Information
Systems, Inc. This Data Processing Agreement is
incorporated by reference from Form 10-K of Brenton
Banks, Inc., for the year ended December 31, 1991.
Exhibit 10.14
Item Processing Agreement dated December 1, 1991
between Brenton Bank Services Corporation and the
Federal Home Loan Bank of Des Moines. This Item
Processing Agreement is incorporated by reference
from Form 10-K of Brenton Banks, Inc., for the year
ended December 31, 1992.
Exhibit 10.15
Restated Trust Agreement for Brenton Banks, Inc.
Retirement Plan, effective January 1, 1986. This
Restated Trust Agreement is incorporated by reference
from Form 10-K of Brenton Banks, Inc., for the year
ended December 31, 1991.
30
Exhibit 10.16
Amendments to the Restated Trust Agreement for Brenton
Banks, Inc. Retirement Plan, effective January 1, 1987,
January 1, 1993 and January 1, 1994.
Exhibit 10.17
Indenture Agreement with respect to Capital Notes dated
April 12, 1993. This Indenture Agreement is
incorporated by reference from Form 10-K of Brenton
Banks, Inc., for the year ended December 31, 1993.
Exhibit 10.18
Indenture Agreement with respect to Capital Notes dated
April 14, 1992. This Indenture Agreement is
incorporated by reference from Form 10-K of Brenton
Banks, Inc., for the year ended December 31, 1992.
Exhibit 10.19
Indenture Agreement with respect to Capital Notes dated
August 5, 1991. This Indenture Agreement is
incorporated by reference from Form 10-K of Brenton
Banks, Inc. for the year ended December 31, 1991.
Exhibit 10.20
Indenture Agreement with respect to Capital Notes dated
March 27, 1991. This Indenture Agreement is
incorporated by reference from Form 10-K of Brenton
Banks, Inc. for the year ended December 31, 1991.
Exhibit 10.21
Indenture Agreement with respect to Capital Notes dated
April 5, 1985. This Indenture Agreement is
incorporated by reference from Form 10-K of Brenton
Banks, Inc. for the year ended December 31, 1991.
Exhibit 10.22
Indenture Agreement with respect to Capital Notes dated
April 8, 1994.
Exhibit 10.23
Split Dollar Insurance Agreement between the Company,
William H. Brenton Crummy Trust and William H. Brenton
Crummy Trust II, dated November 23, 1994.
Exhibit 10.24
Split Dollar Insurance Agreement between the Company
and Brenton Life Insurance Trust for the benefit of C.
Robert Brenton, dated August 12, 1994.
Exhibit 10.25
Agreement between Robert L. DeMeulenaere and the
Company regarding the change in control arrangements,
dated December 31, 1994.
31
Exhibit 10.26
Agreement between Larry A. Mindrup and the Company
regarding the change in control arrangements, dated
December 31, 1994.
Exhibit 11
Statement of computation of earnings per share.
Exhibit 12
Statement of computation of ratios.
Exhibit 13
The Annual Report to Shareholders of Brenton Banks,
Inc., for the 1994 calendar year.
Exhibit 21
Subsidiaries.
Exhibit 23
Consent of KPMG Peat Marwick LLP to the incorporation
of their report dated February 17, 1995, relating to
certain consolidated statements of condition of Brenton
Banks, Inc. into the Registration Statement on Form S-8
of Brenton Banks, Inc.
Exhibit 27
Financial Data Schedule (filed only with Electronic
Transmission).
The Parent Company will furnish to any shareholder upon request a
copy of any exhibit upon payment of a fee of $.50 per page. Requests for
copies of exhibits should be directed to Steven T. Schuler, Chief Financial
Officer/Treasurer/Secretary, at Brenton Banks, Inc., P.O. Box 961,
Des Moines, Iowa 50304-0961.
(b) Reports on Form 8-K: No reports on Form 8-K were required
to be filed during the last quarter of 1994.
32
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the Registrant has duly caused this report
to be signed on its behalf by the undersigned, thereunto duly authorized.
BRENTON BANKS, INC.
By /s/ C. Robert Brenton
Chairman of the Board of Directors
C. ROBERT BRENTON
Date: March 9, 1995
Pursuant to the requirements of the Securities Exchange Act of
1934, this report has been signed below by the following persons on behalf of
the registrant and in the capacities and on the dates indicated.
By /s/ William H. Brenton
Chairman of the Executive Committee,
Vice Chairman of the Board of Directors and Director
WILLIAM H. BRENTON
Principal Executive Officer
Date: March 9, 1995
By /s/ C. Robert Brenton
Chairman of the Board and Director
C. ROBERT BRENTON
Principal Executive Officer
Date: March 9, 1995
33
By /s/ Robert L. DeMeulenaere
President and Director
ROBERT L. DEMEULENAERE
Principal Executive Officer
Date: March 9, 1995
By /s/ Steven T. Schuler
Chief Financial Officer/Treasurer/Secretary
STEVEN T. SCHULER
Chief Financial Officer
Date: March 9, 1995
By /s/ Jennifer Hixson Carney
Controller
JENNIFER HIXSON CARNEY
Date: March 9, 1995
BOARD OF DIRECTORS
By /s/ Junius C. Brenton
JUNIUS C. BRENTON
Date: March 9, 1995
By /s/ R. Dean Duben
R. DEAN DUBEN
Date: March 9, 1995
By /s/ Hubert G. Ferguson
HUBERT G. FERGUSON
Date: March 9, 1995
By /s/ Gary M. Christensen
GARY M. CHRISTENSEN
Date: March 9, 1995
34
EXHIBIT INDEX
Exhibits Page
Exhibit 3
The Articles of Incorporation, as amended, and Bylaws,
as amended, of Brenton Banks, Inc. These Articles of
Incorporation and Bylaws are incorporated by reference
from Form 10-K of Brenton Banks, Inc., for the year
ended December 31, 1993. . . . . . . . . . . . . . . . . . 39
Exhibit 10.1
Summary of the Bank Bonus Plans under which some of the
executive officers of the Parent Company and certain
other personnel of the subsidiaries are eligible to
receive a bonus each year. . . . . . . . . . . . . . . . . 40
Exhibit 10.2
Summary of the Executive Bonus Plan under which some
of the executive officers of the Parent Company are
eligible to receive a bonus each year. . . . . . . . . . . 42
Exhibit 10.3
Summary of the Trust Division Bonus Plan under which
one of the executive officers of the Parent Company
is eligible to receive a bonus each year. . . . . . . . . . 44
Exhibit 10.4
Summary of the Brokerage Bonus Plan under which one
of the executive officers of the Parent Company is
eligible to receive a bonus each year. . . . . . . . . . . 46
Exhibit 10.5
Summary of the Employee Bonus Plan under which
employees of the Company are eligible to receive a
bonus each year. . . . . . . . . . . . . . . . . . . . . . 48
Exhibit 10.6
Employment Agreement, dated July 6, 1989, between
William H. Brenton and Brenton Banks, Inc. . . . . . . . . 50
Exhibit 10.7
Non-Qualified Stock Option Plan, Administrative
Rules and Agreement under which officers of the
Company are eligible to receive options to purchase
an aggregate of 300,000 shares of the Company's $5
par value common stock. This Non-Qualified Stock
Option Plan, Administrative Rules and Agreement is
incorporated by reference from Form 10-K of Brenton
Banks, Inc., for the year ended December 31, 1992. . . . . 57
35
Exhibit 10.8
Long-Term Stock Compensation Plan, Agreements and
related documents, effective for 1994, under which
certain of the Company's senior officers and bank
presidents are eligible to receive shares of Brenton
Banks, Inc. stock based upon their service to the
Company and Company performance. . . . . . . . . . . . . . 58
Exhibit 10.9
Long-Term Stock Compensation Plan, Agreements and
related documents, effective for 1993, under which
certain of the Company's senior officers and bank
presidents are eligible to receive shares of Brenton
Banks, Inc. stock based upon their service to the
Company and Company performance. This Long-Term
Stock Compensation Plan, Agreements and related
documents are incorporated by reference from Form
10-K of Brenton Banks, Inc., for the year ended
December 31, 1993. . . . . . . . . . . . . . . . . . . . . 72
Exhibit 10.10
Long-Term Stock Compensation Plan, Agreements and
related documents, effective for 1992, under which
certain of the Company's senior officers and bank
presidents are eligible to receive shares of Brenton
Banks, Inc. stock based upon their service to the
Company and Company performance. This Long-Term
Stock Compensation Plan, Agreements and related
documents, effective for 1992, are incorporated by
reference from Form 10-K of Brenton Banks, Inc.,
for the year ended December 31, 1992. . . . . . . . . . . . 73
Exhibit 10.11
Standard Agreement for Advances, Pledge and Security
Agreement between Brenton banks and the Federal Home
Loan bank of Des Moines. These standard Agreement
for Advances, Pledge and Security Agreement are
incorporated by reference from Form 10-K of Brenton
Banks, Inc., for the year ended December 31, 1993. . . . . 74
Exhibit 10.12
Short-term note with American National Bank & Trust
Company of Chicago as of April 30, 1993, setting
forth the terms of the Parent Company's $2,000,000
short-term debt agreement. . . . . . . . . . . . . . . . . 75
Exhibit 10.13
Data Processing Agreement dated December 1, 1991
by and between Systematics, Inc. and Brenton
Information Systems, Inc. This Data Processing
Agreement is incorporated by reference from Form
10-K of Brenton Banks, Inc., for the year ended
December 31, 1991. . . . . . . . . . . . . . . . . . . . . 77
Exhibit 10.14
Item Processing Agreement dated December 1, 1991
between Brenton Bank Services Corporation and the Federal
Home Loan Bank of Des Moines. This Item Processing
Agreement is incorporated by reference from Form 10-K
of Brenton Banks, Inc., for the year ended
December 31, 1992. . . . . . . . . . . . . . . . . . . . . 78
36
Exhibit 10.15
Restated Trust Agreement for Brenton Banks, Inc.
Retirement Plan, effective January 1, 1986. This
Restated Trust Agreement is incorporated by
reference from Form 10-K of Brenton Banks, Inc.,
for the year ended December 31, 1991. . . . . . . . . . . 79
Exhibit 10.16
Amendments to the Restated Trust Agreement for
Brenton Banks, Inc. Retirement Plan, effective
January 1, 1987, January 1, 1993 and January 1, 1994. . . . 80
Exhibit 10.17
Indenture Agreement with respect to Capital Notes
dated April 12, 1993. This Indenture Agreement is
incorporated by reference from Form 10-K of Brenton
Banks, Inc., for the year ended December 31, 1993. . . . . 112
Exhibit 10.18
Indenture Agreement with respect to Capital Notes
dated April 14, 1992. This Indenture Agreement is
incorporated by reference from Form 10-K of Brenton
Banks, Inc., for the year ended December 31, 1992. . . . . 113
Exhibit 10.19
Indenture Agreement with respect to Capital Notes
dated August 5, 1991. This Indenture Agreement is
incorporated by reference from Form 10-K of Brenton
Banks, Inc. for the year ended December 31, 1991. . . . . . 114
Exhibit 10.20
Indenture Agreement with respect to Capital Notes
dated March 27, 1991. This Indenture Agreement is
incorporated by reference from Form 10-K of Brenton
Banks, Inc. for the year ended December 31, 1991. . . . . . 115
Exhibit 10.21
Indenture Agreement with respect to Capital Notes
dated April 5, 1985. This Indenture Agreement is
incorporated by reference from Form 10-K of Brenton
Banks, Inc. for the year ended December 31, 1991. . . . . . 116
Exhibit 10.22
Indenture Agreement with respect to Capital Notes
dated April 8, 1994. . . . . . . . . . . . . . . . . . . . 117
Exhibit 10.23
Split Dollar Insurance Agreement between the Company,
William H. Brenton Crummy Trust and William H.
Brenton Crummy Trust II, dated November 23, 1994. . . . . . 132
37
Exhibit 10.24
Split Dollar Insurance Agreement between the Company
and Brenton Life Insurance Trust for the benefit of
C. Robert Brenton, dated August 12, 1994. . . . . . . . . . 174
Exhibit 10.25
Agreement between Robert L. DeMeulenaere and the
Company regarding the change in control arrangements,
dated December 31, 1994. . . . . . . . . . . . . . . . . . 184
Exhibit 10.26
Agreement between Larry A. Mindrup and the Company
regarding the change in control arrangements, dated
December 31, 1994. . . . . . . . . . . . . . . . . . . . . 188
Exhibit 11
Statement of computation of earnings per share. . . . . . . 192
Exhibit 12
Statement of computation of ratios. . . . . . . . . . . . . 194
Exhibit 13
The Annual Report to Shareholders of Brenton Banks,
Inc., for the 1994 calendar year. . . . . . . . . . . . . . 197
Exhibit 21
Subsidiaries. . . . . . . . . . . . . . . . . . . . . . . 240
Exhibit 23
Consent of KPMG Peat Marwick LLP to the incorporation
of their report dated February 17, 1995, relating to
certain consolidated statements of condition of Brenton
Banks, Inc. into the Registration Statement on Form S-8
of Brenton Banks, Inc. . . . . . . . . . . . . . . . . . . 244
Exhibit 27
Financial Data Schedule (filed only with Electronic
Transmission). . . . . . . . . . . . . . . . . . . . . . . 246
38