Charter Bank is an independently owned community bank

headquartered in Eau Claire, WI. Community banks like

Charter Bank are characterized by their local operations and

local decision-making that benefits the communities where the

bank does business.

Since opening our doors in 1980 as a de novo (new bank) in

Eau Claire, WI, we have added more offices in Minnesota to

grow to an asset size of over $835 million. This growth has been

the result of a bank merger in 2015 and the continued success

of providing our clients with financial products that exceed

expectations. Our lending team has over 275 combined years

of lending experience, resulting in exceptional growth in the

number of loan clients and loan balances.

Our success would not be possible without the loyal

patronage of our customers and our community. We are

committed to rewarding their loyalty and support by

making a positive difference in the communities we serve.

Bauer Financial awarded Charter Bank with its highest 5-Star rating for 2016. Charter Bank has been recommended (either 5-Star or 4-Star) by Bauer for 99 consecutive quarters.

It is with great pride that I share the results

of another banner year at our community bank.

I am pleased to report that over $152 million dollars in

new loans were originated by Charter Bank in 2016! This is a new

record for our institution; it reflects the vibrant and healthy economies our

bank serves. We are proud to be a part of the success of the Chippewa Valley and the

Southwest Metro.

The growth in loans has propelled our bank to over $835 million in total assets. In Minnesota,

our loans grew by over 12.5%; while in Wisconsin, our loans grew by 4.3%. On the other side of the

balance sheet, we remain the dominant leader in deposits of all banks in Eau Claire County at 24%.

In addition, we maintain 23.9% of the deposit market share in Carver County.

We are one of the most efficient banks in the country, allowing us to provide our clients with generous deposit rates and extremely competitive loan rates. Furthermore, our management has made credit quality a priority. This is reflected in low delinquency levels on loans and virtually no charged-off loans in 2016. Our hard work has been recognized by Bauer Financial, the nation’s leading bank rating and research firm, as they have awarded Charter Bank a five-star rating for the sixth year in a row! Additionally, SNL Financial named Charter Bank as one of the top 100 banks in the country for banks in our peer group.

Giving back to our community continues to be one of our core values. We were excited to sponsor many events and capital campaigns in both Minnesota and Wisconsin this year. For example, in Wisconsin, supporting the Flying Eagles Ski Club to fund improvements to Silvermine and Mount Washington ski jumps was a major blitz, along with a matching donation campaign

for Feed My People. In Minnesota, one contribution was supporting the Youth Frontiers’ workshops for area youth. And speaking of our Minnesota locations, I am pleased report that our bank was named Large Business of the Year by the Southwest Metro Chamber of Commerce, further illustrating our commitment to our Minnesota market and its business community.

We have made many positive changes at our Minnesota locations in the past year. The biggest being Troy Werk’s promotion to Market President. Troy was heading up our business banking unit as part of our senior management team in Eau Claire, where he did a terrific job, so he was a perfect fit for our Minnesota location’s needs. Troy’s business development skills and leadership abilities have allowed him to transition well into his new position. Angie Everard has also transferred to our Minnesota location. She brings a wealth of mortgage experience and energy. She will be our first full-time dedicated mortgage lender there since our merger. We also added Gerry Weiser, who has been a successful business banker in the market for over 20 years.

We continued to strengthen our team in Wisconsin as well, adding Beth Waldhart as a business banker. Dawn Malcom, with over 25 years of banking experi-ence, joined our staff as our newest mortgage lender. In addition, for the first time in the bank’s history, we have hired two interns from the University of Wisconsin - Eau Claire, further supporting our local university. We’ve continued to hire talented lenders and staff to meet the needs of our growing bank.

Finally, I am so pleased to say, for a third straight year, Charter Bank has been named one of the Best Banks to Work For in the country by American Banker Magazine. Our employees are truly what sets Charter Bank apart from our competitors. We are fortunate to have one of the most talented and seasoned staff in the Midwest. These great employees strive to provide our clients with the best customer service possible, and they look forward to serving our valued customers for years to come.

Jay Brettingen Vice President /

Business Banking

Barbara Crandall Vice President /

Loan Operations Officer

Dan Haas Vice President /

Business Banking

Dustin Hurtgen Vice President /

Business Banking

Rick Lehman Vice President /

Business Banking

Kimberly L. S. NovotneyVice President /

Business Banking

Jerrilyn Parr Vice President /

Human Resource Officer

Paul Kohler President /

Chief Executive Officer

Susan Diel Senior Vice President / Chief Financial Officer

David Pokrandt Senior Vice President /

Chief Credit Officer

Wayne Richmond Senior Vice President /

Chief Operations Officer

Erik LeMay Chief Information

Officer

Troy Werk Market President

Paul Maahs Senior Vice President /

Business Banking

Connie Pedersen Vice President /

Business Banking

Mary Reinert Vice President / Retail Officer

Carol Ann Solberg Vice President /

Information Technology Officer

Robert Strohbusch Vice President /

Mortgage Banking

Gerry Weiser Vice President /

Business Banking

Jeffrey Biegel Assistant Vice President /

Security Officer

Melissa Carlson Assistant Vice President /

Branch Manager

Angela Everard Assistant Vice President /

Mortgage Banking

Michelle Harris Assistant Vice President /

Marketing Officer

Debra Hintz Assistant Vice President /

Compliance Officer

Lynda LaCasse Assistant Vice President /

Credit Officer

Dawn Malcolm Assistant Vice President /

Mortgage Banking

Kent Martinson Assistant Vice President /

Investment Executive

Christine McCorkle Assistant Vice President /

ALM Manager

Jeanie Savage Assistant

Vice President / Retail Banking

Kimberly Showsh Assistant

Vice President / Accounting Officer

Beth Waldhart Assistant

Vice President / Business Banking

Lynette Pank Internal Auditor

Elizabeth Rice Retail Banking Officer

Darrin Schwab Collateral Officer

Sheila Stabe Deposit Operations

Officer

Jesse Werner Mortgage Banking

Officer

OVER 30 YEARSBarbara CrandallSusan Diel

21-30 YEARSJeffrey BiegelDebra HintzMary JacksonKimberly NovotneyJerrilyn ParrSheila Stabe

16-20 YEARS Lisa JohnsonPaul KohlerPaul MaahsJamie MowlDavid PokrandtMary ReinertWayne RichmondBonnie ShermanJennifer Woodford

11-15 YEARS Debra BauerMary BundyKathy FieldLynda LaCasseMary LesterMaureen McRaithPatricia PetersonLori SchindlerKimberly ShowshCarol Ann Solberg

6-10 YEARS Karen BakerJay BrettingenMichael BrynMelissa CarlsonLinda DahlBecki FuhrmanGail GraeseMichelle HarrisLisa HunterKent MartinsonJeanie SavageLeisha SchefflerKathleen StrauchRobert StrohbuschShelly TorgersonTroy WerkJesse WernerLaura WoodfordKathleen Zehr

2-5 YEARS Amanda CheskyShannon DarrowVictoria DvorakSharon EdererAngela EverardDustin HurtgenMary JolitzRichard LehmanLynette PankRobin RundquistShane SimpsonStacy Sturz

BOARD OF DIRECTORSBack Row: Dave Anderson, Brenda Johnson, Damin Zacho,

John Villas, Dave Pokorney, C. Thomas Dow,

Greg Burger, Jo Ellyn DeCesare,

Murray Johnson, Dean Olson.

Front Row: Jeff Halloin, Dennis Zacho, Bob Stevens,

Paul Kohler.

LESS THAN 2 YEARSNicholas AndersonJacob BauerKimberly BergoSamuel CaswellJordan CherryMarcia CurryAnna EhrkeTaylar FredricksonDaniel HaasNancy JacobsonChris KonrardyChristina KraskaDawn MalcolmChristine McCorkleDawn MichaudStina MoranStephanie MorkenConnie PedersenElizabeth RiceKayla SchellfefferRebecca SchlauderaffDarrin SchwabRenae ShafferKathryn SimpsonElizabeth WaldhartAmanda WantaGerald WeiserLinda WhiteKatie WillemssenMeghan Wright

Rebecca Schlauderaff

OVER 30 YEARSBarbara CrandallSusan Diel

21-30 YEARSJeffrey BiegelDebra HintzMary JacksonKimberly NovotneyJerrilyn ParrSheila Stabe

16-20 YEARS Lisa JohnsonPaul KohlerPaul MaahsJamie MowlDavid PokrandtMary ReinertWayne RichmondBonnie ShermanJennifer Woodford

11-15 YEARS Debra BauerMary BundyKathy FieldLynda LaCasseMary LesterMaureen McRaithPatricia PetersonLori SchindlerKimberly ShowshCarol Ann Solberg

6-10 YEARS Karen BakerJay BrettingenMichael BrynMelissa CarlsonLinda DahlBecki FuhrmanGail GraeseMichelle HarrisLisa HunterKent MartinsonJeanie SavageLeisha SchefflerKathleen StrauchRobert StrohbuschShelly TorgersonTroy WerkJesse WernerLaura WoodfordKathleen Zehr

2-5 YEARS Amanda CheskyShannon DarrowVictoria DvorakSharon EdererAngela EverardDustin HurtgenMary JolitzRichard LehmanLynette PankRobin RundquistShane SimpsonStacy Sturz

BOARD OF DIRECTORSBack Row: Dave Anderson, Brenda Johnson, Damin Zacho,

John Villas, Dave Pokorney, C. Thomas Dow,

Greg Burger, Jo Ellyn DeCesare,

Murray Johnson, Dean Olson.

Front Row: Jeff Halloin, Dennis Zacho, Bob Stevens,

Paul Kohler.

LESS THAN 2 YEARSNicholas AndersonJacob BauerKimberly BergoSamuel CaswellJordan CherryMarcia CurryAnna EhrkeTaylar FredricksonDaniel HaasNancy JacobsonChris KonrardyChristina KraskaDawn MalcolmChristine McCorkleDawn MichaudStina MoranStephanie MorkenConnie PedersenElizabeth RiceKayla SchellfefferRebecca SchlauderaffDarrin SchwabRenae ShafferKathryn SimpsonElizabeth WaldhartAmanda WantaGerald WeiserLinda WhiteKatie WillemssenMeghan Wright

Robert StrohbuschShelly TorgersonShelly TorgersonShelly Torgerson

Marcia CurryAnna EhrkeTaylar Fredrickson

LESS THAN 2 YEARS

Assets 2016 2015

Cash and Cash Equivalents $18,245,000 $35,416,000

Investment Securities 188,470,000 199,656,000

Restricted Stock 1,971,000 1,611,000

Net Loans & Leases 595,934,000 560,320,000

Premises and Fixed Assets 8,497,000 8,719,000

Foreclosed Assets 546,000 11,000

Cash Value of Life Insurance 17,200,000 16,618,000

Other Assets 4,301,000 4,499,000

TOTAL ASSETS $835,164,000 $826,850,000

Liabilities

Total Deposits $681,608,000 $685,351,000

Other Liabilities 48,595,000 36,808,000

Total Liabilities 730,203,000 722,159,000

Total Equity Capital 104,961,000 104,691,000

TOTAL LIABILITIES AND EQUITY CAPITAL $835,164,000 $826,850,000

Note: Financial Statement presented is not audited.

LOANS2016

2015

2014

2013

2012 $351,200,000

$356,700,000

$388,124,000

$560,320,000

$595,934,000

$582,300,000

$559,200,000

$590,257,000

$826,850,000

$835,164,000

ASSETS2016

2015

2014

2013

2012

As of December 31, 2016 and 2015

2016 2015

Interest and Dividend Income $33,726,000 $33,213,000

Interest Expense 4,049,000 3,389,000

Net Interest Income 29,677,000 29,824,000

Provision for Loan Losses (450,000) (1,864,000)

Non-interest Income 2,570,000 2,522,000

Non-interest Expense 14,566,000 15,190,000

NET INCOME $18,131,000 $19,020,000

Charter Bank is a Subchapter S Corporation and income taxes are the liability of Charter Bank shareholders.

SECURITIES2016

2015

2014

2013

2012 $178,900,000

$165,581,000

$199,656,000

$188,470,000

$166,700,000

DEPOSITS2016

2015

2014

2013

2012 $480,000,000

$486,496,000

$685,351,000

$681,608,000

$466,100,000

For Years Ended December 31, 2016 and 2015

Annually Charter Bank works with the LE Phillips Memorial Library summer reading program allowing children to turn their reading prizes into donation points. Each year a new child- focused group is chosen as the beneficiary. In 2016, Joshua’s Camp was the designated recipient to support their camps helping children facing cancer and their families.

Again receiving recognition by Big Brothers, Big Sisters of Northwestern Wisconsin for our fundraising efforts for the annual Bowl for Kids’ Sake event. Pictured here: our bowling teams dressed as their favorite TV show characters and receiving the award for being the top Financial Institution fundraiser.

Always looking for ways to engage with our customers and our community, we made it through the rainy day to help support the Southwest Metro Chamber’s Taste of Chaska event.

The annual Steamboat Parade in Carver is a well known

community event. Featuring a band, and lots of candy, we helped support the event and

those in our community with our parade float.

Helping Feed My People with their annual campaign to grow some of their programming. Our partnership helped them reach their fundraising goals through an awareness campaign and Charter Bank’s contribution.

Advancing Hope, Jonah Fund

American Lutheran Homes

American Red Cross

Apple Pregnancy Care Center

Arts Consortium of Carver County, Inc.

Auburn Homes & Services

Beacon Interfaith Housing Collaborative

Big Brothers, Big Sisters of Northwestern WI

Bobs House for Dogs

Bountiful Baskets

Boy Scouts of America

Chippewa Valley Council

Boys and Girls Club of the

Greater Chippewa Valley

CAP of Scott, Carver & Dakota Counties

Carver County Sheriff’s Office

Carver Steamboat Days

Carver-Scott Humane Association

Chanhassen Senior Center

Chaska 100 Club

Chaska Baseball clubs

Chaska Fire Department

Chaska High School DECA program

Chaska Historical Society

Children’s Museum of Eau Claire

Chippewa County Humane Association

Chippewa Falls Senior Center

Chippewa Valley Free Clinic

Chippewa Valley Habitat for Humanity

Chippewa Valley Innovation Center

Chippewa Valley Museum

Chippewa Valley Technical

College Foundation

Cystic Fibrosis

Downtown Eau Claire, Inc.

Dunn County Humane Association

Dyslexia Foundation

Eastern Carver County Schools, District 112Eau Claire Area Chamber Educational FoundationEau Claire Area Chamber of CommerceEau Claire Children’s TheatreEau Claire Community FoundationEau Claire County Humane AssociationEau Claire County Parks Association Eau Claire Elk’s Lodge # 402Eau Claire MarathonEau Claire Memorial Day ParadeEau Claire Parks and RecreationEau Claire Public Schools FoundationEau Claire Regional Arts CouncilEau Claire Sculpture TourEau Claire YMCAEpilepsy Foundation Family Resource CenterFeed My PeopleFeed My Starving ChildrenFellowship of Christian AthletesFlying Eagles Ski ClubFreedom FarmFriends of the Chanhassen LibraryGirl Scouts of the Northwestern Great LakesGirls on the Run of the Chippewa ValleyGrace FoundationHoly Family Catholic High SchoolHope Gospel MissionHope in the ValleyHyde Center for the ArtsIrvine Park Joshua’s Camp Junior Achievement of Northwestern WisconsinJunior Achievement of Upper MidwestKatherine’s WishKids N CopsKiwanis Club of Eau Claire

Launch MinistryLibrary Foundation of Carver CountyLiteracy Chippewa ValleyLocal High School Senior Lock-InsLove, Inc.Marshfield ClinicMary’s WishMayo Health SystemMiracle League of Eau ClaireNorth High School Booster ClubOld Abe Booster ClubPaul Bunyan Logging CampPeople Reaching Out to PeopleREACH FoundationRegis Catholic High SchoolRidgeview FoundationRotary Club of ChanhassenRotary Club of ChaskaRotary Club of Eau ClaireSacred Heart FoundationSalvation Army of Eau ClaireSojourner HouseSouthern Valley Alliance for Battered WomenSouthwest Christian High SchoolSouthwest Metro Chamber of CommerceSpecial Olympics, Indianhead ChapterSt. Francis Food PantrySt. HubertsSt. Joseph’s HospitalThe Bridge for YouthThe Community Table Trinity Equestrian CenterUnited Cerebral PalsyUnited Way of the Greater Chippewa ValleyUnited Way of the Twin CitiesWestern DairylandYouth Frontiers

In 2016, our employees volunteered for over 1,350 hours to assist those in need and help make the neighborhoods we serve a better place for our customers and our families.

Each year the bank contributes to non-profit organizations and our employees assist organizations by donating their time for special projects by serving on a variety of boards and committees.

Charter Bank is dedicated to supporting the communities we serve.

Library Foundation of Carver County

Local High School Senior Lock-Ins

Miracle League of Eau ClaireNorth High School Booster ClubOld Abe Booster ClubPaul Bunyan Logging CampPeople Reaching Out to PeopleREACH FoundationRegis Catholic High SchoolRidgeview FoundationRotary Club of ChanhassenRotary Club of ChaskaRotary Club of Eau ClaireSacred Heart FoundationSalvation Army of Eau ClaireSojourner HouseSouthern Valley Alliance for Battered WomenSouthwest Christian High SchoolSouthwest Metro Chamber of CommerceSpecial Olympics, Indianhead ChapterSt. Francis Food Pantry

St. Joseph’s HospitalThe Bridge for YouthThe Community Table Trinity Equestrian CenterUnited Cerebral PalsyUnited Way of the Greater Chippewa ValleyUnited Way of the Twin CitiesWestern DairylandYouth Frontiers

Library Foundation of Carver CountyLiteracy Chippewa ValleyLocal High School Senior Lock-Ins

Mayo Health SystemMiracle League of Eau ClaireNorth High School Booster ClubOld Abe Booster ClubPaul Bunyan Logging CampPeople Reaching Out to PeopleREACH FoundationRegis Catholic High SchoolRidgeview FoundationRotary Club of ChanhassenRotary Club of ChaskaRotary Club of Eau ClaireSacred Heart FoundationSalvation Army of Eau ClaireSojourner HouseSouthern Valley Alliance for Battered WomenSouthwest Christian High SchoolSouthwest Metro Chamber of CommerceSpecial Olympics, Indianhead ChapterSt. Francis Food Pantry

St. Joseph’s HospitalThe Bridge for YouthThe Community Table Trinity Equestrian CenterUnited Cerebral PalsyUnited Way of the Greater Chippewa ValleyUnited Way of the Twin CitiesWestern DairylandYouth Frontiers

Advancing Hope, Jonah Fund

American Lutheran Homes

American Red Cross

Apple Pregnancy Care Center

Arts Consortium of Carver County, Inc.

Auburn Homes & Services

Beacon Interfaith Housing Collaborative

Big Brothers, Big Sisters of Northwestern WI

Bobs House for Dogs

Bountiful Baskets

Boy Scouts of America

Chippewa Valley Council

Boys and Girls Club of the

Greater Chippewa Valley

CAP of Scott, Carver & Dakota Counties

Carver County Sheriff’s Office

Carver Steamboat Days

Carver-Scott Humane Association

Chanhassen Senior Center

Chaska 100 Club

Chaska Baseball clubs

Chaska Fire Department

Chaska High School DECA program

Chaska Historical Society

Children’s Museum of Eau Claire

Chippewa County Humane Association

Chippewa Falls Senior Center

Chippewa Valley Free Clinic

Chippewa Valley Habitat for Humanity

Chippewa Valley Innovation Center

Chippewa Valley Museum

Chippewa Valley Technical

College Foundation

Cystic Fibrosis

Downtown Eau Claire, Inc.

Dunn County Humane Association

Dyslexia Foundation

Eastern Carver County Schools, District 112Eau Claire Area Chamber Educational FoundationEau Claire Area Chamber of CommerceEau Claire Children’s TheatreEau Claire Community FoundationEau Claire County Humane AssociationEau Claire County Parks Association Eau Claire Elk’s Lodge # 402Eau Claire MarathonEau Claire Memorial Day ParadeEau Claire Parks and RecreationEau Claire Public Schools FoundationEau Claire Regional Arts CouncilEau Claire Sculpture TourEau Claire YMCAEpilepsy Foundation Family Resource CenterFeed My PeopleFeed My Starving ChildrenFellowship of Christian AthletesFlying Eagles Ski ClubFreedom FarmFriends of the Chanhassen LibraryGirl Scouts of the Northwestern Great LakesGirls on the Run of the Chippewa ValleyGrace FoundationHoly Family Catholic High SchoolHope Gospel MissionHope in the ValleyHyde Center for the ArtsIrvine Park Joshua’s Camp Junior Achievement of Northwestern WisconsinJunior Achievement of Upper MidwestKatherine’s WishKids N CopsKiwanis Club of Eau Claire

Launch MinistryLibrary Foundation of Carver CountyLiteracy Chippewa ValleyLocal High School Senior Lock-InsLove, Inc.Marshfield ClinicMary’s WishMayo Health SystemMiracle League of Eau ClaireNorth High School Booster ClubOld Abe Booster ClubPaul Bunyan Logging CampPeople Reaching Out to PeopleREACH FoundationRegis Catholic High SchoolRidgeview FoundationRotary Club of ChanhassenRotary Club of ChaskaRotary Club of Eau ClaireSacred Heart FoundationSalvation Army of Eau ClaireSojourner HouseSouthern Valley Alliance for Battered WomenSouthwest Christian High SchoolSouthwest Metro Chamber of CommerceSpecial Olympics, Indianhead ChapterSt. Francis Food PantrySt. HubertsSt. Joseph’s HospitalThe Bridge for YouthThe Community Table Trinity Equestrian CenterUnited Cerebral PalsyUnited Way of the Greater Chippewa ValleyUnited Way of the Twin CitiesWestern DairylandYouth Frontiers

In 2016, our employees volunteered for over 1,350 hours to assist those in need and help make the neighborhoods we serve a better place for our customers and our families.

Each year the bank contributes to non-profit organizations and our employees assist organizations by donating their time for special projects by serving on a variety of boards and committees.

Charter Bank is dedicated to supporting the communities we serve.

In 2016, our employees volunteered for over 1,350 hours to assist those in need and help make the

Charter Bank received recognition at the Southwest Metro Chamber of Commerce Gala as the Best Large Business of the Year based on our involvement efforts with the Chamber and our community.

Appreciating Our Customers

A big thanks to our employees with their help during our Annual Block Party event. Although it was hot day, it was a wonderful way to show our customers how much we appre-ciate them with great activities and food at our Chaska location.

Offering flowers, hot dogs, and more, we provided another fun year of festivities for our Eau Claire customers during Customer Appreciation Week.

Supporting the Ridgeview Foundation in Minnesota at the annual Under the Harvest Moon fundraising event, showing our support of the organization and their commitment to our community.

For the third year in a row, Charter Bank received the distinguished Best Banks to Work for award given by American Banker Magazine based on a company-wide survey and meeting their established criteria.

Art Exhibit in Eau Claire Showcasing artwork from over 80 local High School artists at our annual Art Exhibit.

Mayo Clinic Health System has brought an exciting event to the Eau Claire area to support their hospice programming. In 2016, we rallied a team to row a boat for the Half Moon Dragon Boat Race. Finishing about in the middle with our race time, we enjoyed a great afternoon of camaraderie for a great cause.

The Jeffers Park ballfield in Eau Claire has been a dream for many years. In 2016 the project was even closer to completion. By supporting the overall construction and the dugouts, Charter Bank was able to help keep the project moving forward. The youth of our community will enjoy the fields for years to come and will be a destination for outside groups for tournaments and special events.

Charter Bank is proud to continue our annual Downtown Eau Claire Memorial Day Parade sponsorship. We had a great turnout for the event with our employees and their family members.

Staying involved in our community through monetary contributions and volunteerism shows true with our commitment to the United Way of the Greater Chippewa Valley. Pictured here: our group helping with trail maintenance at Beaver Creek Reserve during the United Way Day of Caring – a community-wide volunteer effort.

Proud to con-tinue sponsorship

of the Eau Claire Marathon, helping to

keep our community healthy and active.

Thousands of runners (and bystanders) attend

this annual race, making it a destination event for those

in the Chippewa Valley and beyond.

Eau Claire, WI Chanhassen, MN Chaska, MNEau Claire, WI Chanhassen, MN Chaska, MN

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