Farmers Bank Content

22014 AnnuAl RepoRt | www.fbsc.com

A charter was granted in

the name of The Farmers

Bank and Trust Company

on August 6, 1904, by the

Superintendent of Banks of

the State of Ohio. The Bank

was organized on Court

Street and it was opened

to the public for business

on December 4, 1904. In

1921 the name “Trust”

was replaced by the word

“Savings” in the name of

the Bank. The Bank had

steady growth from the beginning and reached the first million

in deposits in 1943.

In 1963, plans were made for the construction of a new facility.

In 1965 the property between Second Street to Main Street was

purchased and seven buildings were torn down; in 1967, plans

for the new facility were approved and in 1968 construction

began on what was to become the future “home” of the

Farmers Bank. The location of the Bank remained on Court

Street until it moved to its present location at 211 West Second

Street, Pomeroy, Ohio, on April 1, 1969.

On August 30, 1985, a one-bank holding company was formed

known as Farmers Bancshares, Inc.

In May, 1987, the Farmers Bank acquired, through purchase, the

Tuppers Plains Branch of BankOne. This purchase represented

the first branch of the Farmers Bank and enabled us to better

serve the needs of Meigs County. In 1995, the Farmers Bank

purchased a lot on Upper River Road in Gallipolis, built an office

and began serving Gallia County.

On March 25, 2003, the Mason, West Virginia, branch was

opened, which was the first branch of the West Virginia

Division. On May 11, 2006, the Point Pleasant Branch was

opened for business, which, to date, completes the West

Virginia Division of Farmers Bank.

In October of 2011, Farmers Bank started building its newest

addition at 640 East Main Street in Pomeroy. On July 16th,

2012, the two-story building opened for business. The 211

West Second Street location, which previously housed the

Pomeroy retail business, was renovated and now houses the

Operations Support Center.

During the history of the Bank, it has had five presidents,

namely: W. F. Reed, founder; Theodore T. Reed, his son;

Theodore T. Reed, Jr., his grandson; Paul E. Kloes, interim

president at the death of Theodore T. Reed, Jr.; and Paul M.

Reed, the great grandson of the founder.

Farmers Bank has become the oldest independently owned

financial institution in Meigs County since opening its

doors 110 years ago. To date, the Bank has a total of 85

employees at six locations and currently has 28 surcharge free

ATMs (including Hocking Valley ATMs) to serve the Bank’s

customers. We are excited about the future of the Bank and

the service it provides to the community – not only bank-

related services but community service through our employees

and volunteers.

History

On August 30, 1985, a one-bank holding company was formed known as Farmers Bancshares, Inc.

110

Years

C e l e b r a t i n g

3 2014 AnnuAl RepoRt | www.fbsc.com

We’ve all heard that numbers speak for themselves and, if you’re a numbers person, you may enjoy what they say; if not, join me in being thankful that the numbers tell only part of the bank’s success story for 2014. There is much more to our corporation than just “the numbers”.

Members of Congress, regulators, and banking professionals

struggle with defining what it takes to be considered a true

community bank. Some argue that any bank with assets

less than $10 billion automatically makes it a community

bank, but such a narrow interpretation falls short of a true

community bank. It seems more logical that a community

bank’s contribution to its community – what it gives back

to its market as opposed to what it takes from it – is a far

more accurate standard. Using that standard, we consider

ourselves a great community bank.

Our commitment to our communities is evident in our

actions. Monetary donations are an important part of our

support for our communities and are the most obvious to

the public. Youth sports and activities come to mind, but

you may be surprised to learn that we are just as committed

– monetarily and otherwise – to promoting education and

financial awareness with the youth of our community. We

believe these are among our most important efforts to

improve and give back to our area.

Our ability to support our community is a product of

our financial strength as a company. The post-recession

banking environment continues to present unprecedented

challenges. We are simultaneously navigating the challenges

of an extended period of record low interest rates and

a regulatory burden that has traded our “small town”

competitive advantage in favor of a “one size fits all”

philosophy. Net Income may be the easiest performance

indicator to understand but it is only a one year indication

of profitability and does not measure long term success.

Like many banks, we have been focused on improving our

balance sheet strength by reducing non-performing loans

and problem assets along with growing our capital base.

The evaluation of our share price rewarded these efforts

and recognized that despite 2014’s net income total our long

term earnings outlook is improving. We are pleased to report

the market value of your stock in Farmers Bancshares Inc.

has increased over last year’s share price.

COMMUNITY BANKING FINANCIAL PERFORMANCE

Message from the President


Occasionally my job gives me the opportunity to travel to

conferences where other CEOs discuss their strategies and

future plans, and I’m surprised sometimes by how pessimistic

my colleagues can be. Many have surveyed the economy and

the regulatory burden and have decided to give up, to sell or to

merge; they have decided that somebody else can do it better.

I can’t imagine reaching that conclusion.

The one thing about banking that has stayed consistent during

my career is the fact that successful banks are built on people

motivated by excellence. I’m blessed to be surrounded by a

talented management team that has led the bank through the

most troubled economy of our lifetime, dealt with relentless

regulatory oversight and produced record results. That is and has

always been the Farmers Bank’s number one reason for its strong

performance. The continued success of the bank depends on our

Board of Directors, the management team, and our employees.

With that in mind I look to our future with confidence.

THE FUTURE

We are pleased to report the market value of your stock in Farmers Bancshares Inc. has increased over last year’s share price.


COMMUNITY INvOLvEMENT

Investing in our community is our way of giving back to

those who have helped support us for so long. Volunteer

groups and non-profit organizations do so much to help our

communities, but they can’t do it alone. That is why we

support various causes and organizations where we live and

work. Giving back today ensures the success of tomorrow

and generations to come.

Farmers Bank has continued to empower economic

awareness and education to our community since the time

we opened our doors in 1904. In 2014, we provided financial

education programs to local high schools, created an actual

business environment for our Junior Board of Directors,

supported our local Sheriff’s Department, hosted and

participated in numerous local events, supported all local

county fairs and much more.

Farmers Bank doesn’t just offer donations; our employees

put forward a big helping hand by volunteering their time

and services. Last year, our employees logged over 1,000

hours of community service by serving on boards, working

in schools and supporting local non-profit organizations in

a wide variety of ways. They share their personal time to

maximize awareness and emphasize Farmers Bank’s impact

on the community. Each of these opportunities leads to

community roots that run deep for Farmers Bank.

give back

For more than 110 years, we have believed that a great bank gives back!

Over the course of two short months, three Farmers Bank employees led the kIDs Safe Fundraising Campaign that raised $10,000 for the Meigs County Sheriff’s Office. With the dedication of their coworkers and joined by area businesses, Lori Miller, and her husband Shannon, Tina Wood Richards, and Brian Howard were able to assist the Sheriff’s Office in purchasing Identity Safe equipment which will help identify a child in the event of an emergency. This program is widely recognized, and participated in by surrounding law enforcement agencies.

On December 11th, Lori and Tina presented Sheriff Keith Wood with a check for the full amount needed. On behalf of the Sheriff’s Office, he awarded Lori and Shannon Miller, and Tina Wood Richards the Buckeye State Sheriff’s Association certificates of appreciation for their dedicated efforts.

kIDs Program


Point Pleasant River Museum – Dragon Boat Festival

Farmers Bank had a great time participating in this year’s Dragon Boat

Festival in Point Pleasant, WV. The festival helps raise money for the

Point Pleasant River Museum.

Eastern Lady Eagles

The Eastern Lady Eagles made our community very proud by becoming

the 2014 Division IV state basketball champions! To recognize their

outstanding accomplishments, Farmers Bank donated championship

jackets and rings for the entire team. In addition to the jackets and

rings, Farmers Bank donated the championship banner to hang in the

school’s gymnasium. Congratulations, ladies!

Gallipolis in Lights

‘Tis the season! Farmers Bank helped spread the holiday cheer

by partnering with the Gallipolis in Lights group. With the help of

local businesses and residents, this committee made the City Park

absolutely beautiful with lights and decorations!

The Hoop Project

Farmers Bank made a major slam dunk by sponsoring a court for The

Hoop Project this past summer! The Hoop Project is southern Ohio’s

premier 3-on-3 Full Court outdoor basketball tournament along the

streets of downtown Gallipolis, Ohio.

Taste of Home Cooking School

Farmers Bank isn’t just known for great banking! We are also known

for our skills in the kitchen. Our staff helped make this year’s Taste of

Home Cooking School one of the best yet! The Taste of Home Cooking

School is America’s #1 leading cooking school program. Just call us

Chef BoyarFBSC!

Junior Board

Last year’s class of our Junior Board of Directors visited the State

House and met with Ohio Senator, Lou Gentile (pictured here),

Representative Debbie Phillips, and other government officials.


Where We’ve beenThe Farmers Bank coin bag has become quite a popular item throughout our community…

actually the world! The coin bag started out as an accessory to keep your spare change and has

evolved into much more; it is now a “must have” for any vacation or memorable moment. From

sporting events to county fairs, from scuba diving to parasailing, from local hikes to international

travels…our friends and neighbors never leave home without it. Be on the lookout, we never

know where the Farmers Bank coin bag will show up next!


Social Media SuccessThe surge in technology over the past decades has caused a

noticeable shift in the banking industry. From social media to

online transactions, our customers and their behaviors have

been transitioning to a mobile environment. Your bank noticed

this trend early and has quickly become a frontrunner in social

media. We are able to effectively reach our customers and

employees in a manner that has positioned Farmers Bank as a

key leader in the “Mobile Move”. From banking conferences

to comments by other bankers, Farmers Bank is known for

its superior presence on social media. Your bank is where our

customers need us to be! Always have been. Always will be.

Consider this: The Millennial customer will spend an average

of 128 minutes per day on a smartphone. Between 2013 and

2014, this generation became the majority of the United States

Labor Force and will continue to grow. These statistics shared

by David L. Peterson at the 2015 American Bankers Association

National Conference for Community Bankers, illustrate your

bank’s dedication to the “Mobile Move”. Mr. Peterson shared

additional statistics such as:

■ 79% of smartphone owners shop on their mobile device.

■ 32 hours are spent browsing the web weekly.

■ 23 hours are spent on social networking weekly.

(3.29 hours per day)

■ Mobile banking adoption increased by 40% in 2013 and is

projected to keep increasing over the next several years.

myfarmersbank

+Fbscmyfarmersbank

@myfarmersbank

myfarmersbank


Farmers Bancshares, Inc.

President Paul M. Reed

Vice President Paul E. Kloes

Vice President/Financial Officer Shawn W. Arnott

Treasurer Jaynee R. Davis

Secretary Erin L. Krawsczyn

Farmers Bank & Savings Co.

President Paul M. Reed

Executive Vice President Shawn W. Arnott

Executive Vice President Mark R. Groves

Executive Vice President Michael R. Lieving

Senior Vice President Edgar S. Lanham, II

Senior Vice President Donna J. Schmoll

Vice President Diane Craddock

Vice President Heather L. MacKnight

Vice President Leigh Ann Shepard

Vice President Jessica L. Staley

Vice President Edna M. Weber

Assistant Vice President Jaynee R. Davis

Assistant Vice President Randall C. Hays

Assistant Vice President Erin L. Krawsczyn

OFFICERs

Farmers Bank & Savings Co. and Farmers Bancshares, Inc.

Paul E. Kloes, Chairman

Thomas W. Karr

Douglas W. Little

John F. Musser

Paul M. Reed

Theodore T. Reed, III

Jared A. Sheets

David L. Weber

BOARD OF DIRECTORs

EVP Woody Stines retired at the end of 2014. We wish him the best of luck and thank him for making us a better bank.

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Farmers Bank Content