2009 annual report
A Clear Path
A Constant Vision
fulfilling our vision together
A Clear Path
to growth
jerry anderson promoted
Jerry Anderson has joined the Executive Management Team. Having served
as Vice President, Controller since 2001, Jerry was promoted to Chief
Financial Officer. He is responsible for overseeing the bank’s financial and
accounting systems. Jerry has been in banking for 23 years and has been
with Stockman Bank for 18 of those years. His knowledge and expertise
make him well-qualified to lead this essential part of the Stockman Bank
Team. His promotion was announced by Bill Coffee prior to year-end and
was effective January 1, 2010.
Dear Customers, Shareholders and Friends,
The phrase “our path is clear” comes from one of Stockman Bank’s first television
commercials. It shows a clear, sunny day in a Montana meadow with mountains
in the background, all covered in fresh deep snow. By looking at the snow cover,
the viewer instantly knows the night before must have seen a terrible storm, but
this refreshing view is of a new day. The only track in sight is a single path boldly
winding down through the snow drifts, across a shallow portion of a stream, then
up the embankment on the other side heading toward the horizon as far as one
can see. This image symbolizes Stockman’s journey during 2009 and our clear
path into the future.
Stockman faced many obstacles in 2009 and through these challenging times
stayed true to the foundation principles that have served us so well since 1953.
Conservative lending practices, knowing our customers, and serving our neighbors,
have allowed Stockman to avoid many of the credit quality issues other financial
institutions face. Additionally, our accumulated capital remains a source of great
strength. In fact, Stockman’s capital grew almost $15 million during the year,
which further strengthened the company. Stockman remains “well-capitalized”
by all regulatory guidelines. Most importantly, we have a dedicated, experienced
team of 450 employees committed to Montana banking and the communities
they serve. 2009 forced all of us to pull together and draw on our experience like
no other year in recent memory. The hard work and aspirations of our team are
still Stockman’s greatest assets.
Wherever there is challenge there is also opportunity. Stockman added $205
million in total assets and grew net loans by $135 million during the year.
This powerful growth is particularly impressive in comparison to many of our
competitors who remained inactive through most of 2009. Besides internal
growth, another source of opportunity is acquisition. Over the last 12 months,
Stockman has been approached by several banks to acquire them. These
potential acquisitions include banks in new communities within Montana, as
well as banks in communities currently served by Stockman. We continue to look
for opportunities to serve more of our neighbors.
At Stockman our path is clear. We continue to move forward and grow based
upon our principles, insights and experience earned over the last 56 years.
Wm. Coffee
Chairman & Chief Executive Officer
executive management team
Our dedicated Executive Team expertly leads our bank, with 114 years of combined experience.
Wm. Coffee, Chairman & Chief Executive Officer
Jerry Anderson, Chief Financial Officer
Bill Bickle, Chief Credit Officer
Kelly Klem, Chief Administrative Officer &
Chief Investment Officer
Paul Roble, Chief Technology Officer
Dave Zoanni, Chief of Branch Supervision
2009 Stockman Financial Corp. Board of Directors
Wm. Coffee, Chair
Ronald J. Haugan, Vice Chair
Bill Bickle
Butch Bratsky
C.M. Coffee
Virginia Coffee
Jim Drummond
Robert J. Goss
Garth Kallevig
Kelly Klem
2009 Stockman Bank of
Montana Board of Directors
Wm. Coffee, Chair
C.M. Coffee
Virginia Coffee
Robert J. Goss
Ronald J. Haugan
Sam Ohnstad
Mary M. Singleton
Dan Majerus
Stanley Markuson
Wayne Nelson
Sam Ohnstad
Ron Pisk
Craig Rehm
Keith Robinson
Paul Roble
Mary M. Singleton
Dave Zoanni
2009 Stockman Insurance
Board of directors
Jerry Anderson, Chair
K.C. Keith, Vice Chair
Bill Bickle
Wm. Coffee
Kelly Klem
Dave Zoanni
Keith Robinson
Dan Majerus
2009 Stockman Asset Management board of directors
Kelly Klem, Chair
Ron O’Donnell,
Vice Chair
Bill Bickle
Wm. Coffee
Dave Zoanni
Achieving Along the Path
Achieving Along the Path
2009 Distinguished Service Award for
Contributions to Business Education
Great Falls Best Bank &
Business Achievement Award
Stockman Bank was presented this award during the Montana Business Education Association annual
meeting in October. Stockman Bank is very active in schools across Montana, but was specifically mentioned
for their contributions to the business education classes at Conrad High School. Janie McFarland, CHS
Business Teacher, nominated Stockman Bank for all they do for her program at Conrad High School.
Stockman Bank Great Falls won the Great Falls Business’ Fourth
Annual Business Achievement Award in the large business category,
due to its growth in economic development and community
involvement. They were also voted Greatest of Great Falls in the
Financial category for the second year in a row under the leadership
of Randy Williams, Great Falls President.
Photo courtesy of Great Falls Tribune
Butch Bratsky:
Ag Excellence Award winner
Butch Bratsky, Senior Banking Executive, was awarded the Roche Jaune Award
for Agriculture Business Excellence by the Billings Chamber of Commerce. The Roche
Jaune Award was established three years ago by the Billings Chamber/CVB Board and
staff. They saw the need for a business and community awards event for Billings.
Today, this premier awards event recognizes the amazing residents, organizations and
businesses that help improve the quality of life and business in Billings.
Jon Redlin: State Banking Board
Jon Redlin, Senior Vice President/Ag Department Manager for Stockman Bank
Sidney, was reappointed by Governor Schweitzer to a second term on the Montana
Board of Banking. The Board works with the Montana Division of Banking and
Financial Institutions of the Department of Administration, primarily in making
determinations for authorization of new state chartered banks and trust companies.
Redlin graduated with honors from Southwest State University-Minnesota in agribusiness and finance, and has over 20 years in banking.
Billings: #1 Construction Lender
Stockman Bank Billings continues to be a leader in the community in all areas of lending, and was ranked
the #1 Construction Lender in Yellowstone County in 2009. The ranking was based on market-share
reports gathered by Rocky Mountain Statistics (RMS) Information Services.
Bozeman oak
Stockman Bank opened their second location in Bozeman on
the corner of Oak and North 19th. Travis Wright was promoted
to Branch Manager to oversee and manage the Bozeman Oak
location, which marks the 22nd full-service Stockman Bank
across Montana.
clearing the path for others
Stockman Bank partners with local
schools and organizations
clearing the path for others
Montana FFA contribution
Stockman Bank has been a proud supporter of the Montana FFA
Foundation since its inception in 1998. In 2009, Stockman Bank
was the sole sponsor for the Farm Business Management Career
Development Event and the American Indian Program, showcasing
Native American FFA Chapters across Montana. Stockman Bank was
also a major sponsor at the State Convention and a sponsor of plaques
for FFA members receiving the highest honor FFA bestows.
Photo courtesy of Sidney Herald/Harry Lipsiea
In July, Stockman Bank was proud to donate money for a new scoreboard at Lyndale Park in Sidney.
The scoreboard will benefit not only the local Little League Baseball Program, but everyone in the
community.
Stockman Bank Cut Bank contributed money toward two new scoreboards for
their high school gym in November. Stockman Bank Conrad contributed money
toward new scoreboards for their football field and new gym. Stockman Bank
was proud to support enhancements that will touch those involved with the
local youth athletic programs and their many supporters.
Montana Stockgrowers
Association
The 125th Anniversary of the Montana Stockgrowers Association was held in
Miles City. Stockman Bank has been a long-time member of this organization.
billings food bank
Stockman Bank contributed to the capital campaign for the
building of the new Billings Food Bank and later responded
to their need for immediate financing for the project to
be completed. Within 24 hours of their request, Billings
President Wayne Nelson put together a creative financing
package to meet their needs.
billings habitat
for humanity
Stockman Bank helped with Habitat for Humanity’s
49th home in Billings. Stockman Bank has contributed
approximately $100,000 to this organization over the past
ten years.
havre-msu ag
experiment station (MAES)
In February, Stockman Bank was proud to contribute money toward
the MAES to be built in Havre. The research center will bring new
knowledge to the agricultural economy including development and
introduction of new grain varieties, exploration of alternative highvalue crops, new management strategies, and innovative options and
recommendations for profitable livestock production. Seven MSU
research centers are located across Montana, and the Havre project is
the third facility Stockman Bank has supported.
Photo courtesy of Havre Daily News/Nikki Carlson
focusing on a common vision
focusing on a common vision
stockman bank affiliates
Stockman Bank, through highly-specialized divisions of our company, offers investment, wealth
management, insurance and ag deferred payment services.
The Right Protection You Need…The Right People To Insure It!
Although the current economic recession has impacted the revenue growth of the insurance industry,
Stockman Insurance enjoyed a 10.5% growth in 2009. In contrast, 2009 national financial statistics
indicated bank-owned insurance agencies showed a 1.8% increase in revenue. Our double digit growth
in revenue each year for the past three years is based on strong underwriting experience, competitive
products and superior customer service.
Stockman Asset Management (SAM) is a registered investment advisor managing
equity and fixed income portfolios for a broad range of clients, including high-networth individuals, corporations, foundations, retirement plans and community banks.
OUR Vision
• Continue earning the precious gift of trust and confidence bestowed by our clients.
• Provide unbiased, objective investment advice free of conflicts of interest.
• Generate performance greater than the market over a market cycle, while taking
less risk.
• Provide unsurpassed customer service and client communication.
• Integrate the latest technologies that support and enhance this vision.
Ron O’Donnell • President/CEO
21 years experience
Investment Process
Local decision-making and exhaustive in-house research with a focus on high-quality investments, risk
management, and disciplined, consistent application of a well-defined and proven investment approach.
OUR People
• Eight full-time employees that are fully motivated to live the SAM vision they helped to create.
• In order to raise our commitment to incomparable service to a new level, SAM welcomed Eric George
as Director of Marketing & Investor Relations in the fall of 2009.
As a “Trusted Choice” Independent Agency, Stockman Insurance has aligned itself
with top-rated national insurance carriers and will continue to be committed to
our customers’ needs by providing the most comprehensive products at the most
competitive price.
Growth of investment ($250,000)
Stockman Insurance is excited about our continued new growth momentum. Customer
retention is remarkably high, a direct result of our excellent customer service and
competitive products. The opportunities in 2010 are unlimited. Stockman Insurance
will continue to grow in revenue by making significant improvements in products,
staff, and just as important, customer service.
750,000
SAM
S&P 500
650,000
KC Keith • Vice President
2009
Stockman Asset Management large cap value compositE vs. s&P 500
$460,484
$275,039
. 84.3% Cum. . 5.7% Annual
. 10% Cum. . .9% Annual
550,000
450,000
350,000
stockman exchange, Inc.
Stockman Exchange offers services tailored to the needs of
ag producers. Deferred payment contracts allow producers
to sell their commodity (primarily grain and livestock)
during the current tax year, but defer the income to another
tax year. Stockman Exchange Inc. is located at your local
Stockman Bank. Sellers are advised to consult an attorney
or tax accountant to discuss the effect of deferred payment
contracts on their state and federal income tax liability.
250,000
150,000
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
Stockman Asset Management is a registered investment adviser with the Securities and Exchange Commission and a wholly owned subsidiary of Stockman Financial Corp., a financial holding company headquartered in Miles City, MT. The Large Cap Value Equity Composite contains fully discretionary large cap value equity accounts and for comparison purposes is measured against the S&P 500 Index. The Large Cap Value
Equity Composite assets as of December 31, 2009 were $10.5 million, which represented 0.7% of the firm’s total assets under management. Returns are calculated in U.S. dollars. All performance results shown
are net of actual fees and commissions. Performance does not adjust for any withholding tax on dividends, interest or capital gains. Returns take into effect the reinvestment of dividends with the exception of the
affiliated account. Had this account’s performance included reinvestment of dividends, the performance may be different than reported. As of February 5, 2004, returns for the affiliated account take into account the
reinvestment of dividends. The S&P 500 Index is an unmanaged index of the shares of large U.S. companies. It includes dividends and is presented gross of fees. Investors are cautioned that there is a significant
possibility of loss in portfolio value. This is not a recommendation, nor a guarantee to reflect similar holdings in a client’s portfolio. Nothing contained in this presentation should be construed as a recommendation to
buy or sell a security or economic sector. For our Large Cap Value Equity Composite annual performance and full disclosures, please contact Ron O’Donnell at (406) 655-3960. Past performance is no guarantee
of future results. Not FDIC insured. No bank guarantee. May lose value.
Not FDIC Insured. No Bank Guarantee. May Lose Value.
Pat Angland, portfolio manager, is the Chair of the Board
of Directors for the Boys & Girls Club of Yellowstone County,
which serves over 650 youth daily. He has been involved with
the local Club since 2001 and was involved on the statewide
Montana Alliance of Boys & Girls Club Board of Directors
from 2003-2009, serving as Chair from 2006-2009.
balance sheet
Assets
Cash and Due from Banks
Investment Securities
Loans
Agriculture
Agriculture Real Estate
Commercial
Commercial Real Estate
Residential Real Estate
Consumer
Less Allowance for Loan Losses
Loans Receivable, Net
Federal Home Loan Bank Stock
Premises and Equipment
Other Assets
Total Assets
Liabilities and Stockholders’ Equity
Deposits
Securities Sold Under Repurchase
Federal Funds Purchased
Borrowings
Other Liabilities
Total Liabilities
Common Stock
Retained Earnings
Other Equity
Total Stockholders’ Equity
Total Liabilties and Stockholders’ Equity
12/31/2009
$51,358,479 448,288,199
261,176,758
236,907,662
152,318,981
352,603,443
175,591,589
35,235,472
(18,816,092)
$1,195,017,813
3,443,400
47,238,446
50,070,001
leading us along the path
Market presidents
12/31/2008
$59,870,793
391,569,628
216,131,991
218,665,363
139,411,630
316,885,709
148,118,492
37,423,890
(16,437,543)
$1,060,199,532
3,443,400
40,786,146
34,479,410
$1,795,416,338 $1,590,348,909
$1,271,590,193 189,720,221
16,150,000
106,935,158
46,444,210
$1,630,839,782
$1,108,527,035
160,999,582
11,260,000
110,526,006
48,680,114
$1,439,992,737
7,851,648
152,625,502
4,099,406
$164,576,556
7,264,150
140,238,031
2,853,991
$150,356,172
$1,795,416,338
$1,590,348,909
Wayne Nelson
Dan Majerus
Craig Rehm
Billings
Conrad
Dillon
Jim Drummond
Keith Robinson
Randy Williams
Gallatin Valley
Great Falls
Glendive
Stanley Markuson
Garth Kallevig
Miles City
Sidney
community advisorY boards
Billings
Wayne Nelson, Chair
Tim Anderson
Butch Bratsky
Greg Hardy
Ron Haugan
Roger Jacobs
Mac Ketterling
Terry Lee
Bob Popelka
Robert L. Sanderson
Rod Wilson
Dave Zoanni
Conrad/
Cut Bank
Dan Majerus, Chair
Doug Sheble, Vice Chair
Rick Billman
Bob Hodgskiss
John McFarland
Dave Zoanni
Dillon
Craig Rehm, Chair
Debora Creger
James McIsacc
Doug Peterson
Dave Zoanni
Gallatin
Valley
Jim Drummond, Chair
Carl Lehrkind IV
Jane Mersen
Chris Nelson
Gene Spranget
Harrison Trask
Sherm Veltkamp
Ken Walker
Travis Wright
Dave Zoanni
Glendive
Verle L. Jones, Chair
Kevin Dorwort
Gerald Hoffer
Kyle Milne
Keith Robinson
Dave Zoanni
Great Falls
Randy Williams, Chair
Mary Chaffin
Julie Duffy
Alison Fried
Mort Malek
Dennis Peterson
Andy Taylor
Dave Zoanni
Havre
Chuck Wimmer, Chair
Murray Barkus
Robin Toner
Greg Woods
Dave Zoanni
Plentywood
Paul Hansen, Chair
Garth Kallevig
Dr. Todd Marsh DVM
Willard “Woody” Michels
Cory Sampsen
Dave Zoanni
Sidney
Dr. I.J. Peterson, Chair
Glen Asbeck
Robert J. Goss
Garth Kallevig
Melvin Leland
Michael McCollum
Dave Zoanni
Worden
Stanley Markuson, Chair
Butch Bratsky
Gerry Breiland
N C (Pete) Hinson
Michael Reiter
Randy Sian
Dave Zoanni
stockman bank locations
BELGRADE
GLENDIVE
6050 Jackrabbit Lane • 388-5025
204 West Bell • 377-1000
BILLINGS
GREAT FALLS
2700 King Ave W • 655-2700
800 Main Street • 896-4800
1450 Shiloh Road • 655-3900
2425 10th Avenue South • 771-2740
25 5th Street North • 771-2740
711 3rd Street Northwest • 771-2740
BOZEMAN
HAVRE
1815 South 19th Avenue • 556-4100
1433 North 19th Avenue • 556-4130
324 Third Avenue • 265-3800
CONRAD
Mortgage Services
700 West Custer Avenue • 441-1597
HELENA
420 South Main Street • 278-8200
CUT BANK
PLENTYWOOD
102 North Main Street • 765-2460
RICHEY
102 South Main Street • 773-5521
SIDNEY
101 South Central Avenue • 433-8600
TERRY
117 Logan Avenue • 635-5591
WIBAUX
HYSHAM
125 West Main Street • 873-5517
MILES CITY
700 Main Street • 234-8420
719 Elliot Avenue • 342-5214
120 South Wibaux Street • 796-2424
WORDEN
DILLON
2450 Main Street • 967-3612
590 North Montana • 683-1600
plentywood
cut bank
Havre
conrad
sidney
richey
great falls
glendive
wibaux
terry
helena
miles city
belgrade
bozeman
dillon
© 2010 Stockman Bank
worden
billings
hysham