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COP Board of Governors of the Federal Reserve System
FRY-6 OMB Number 7100-0297 Ap proval expires December 31 2015 Page 1 of2
Annual Report of Holding Companies-FR Y-6
Report at the close of business as of the end of fiscal year
This Report is required by law Section 5(c)(1 )(A) of the Bank Holding Company Act (12 USC sect 1844 (c)(1 )(A)) Section 8(a) of the International Banking Act (12 USC sect 3106(a)) Sections 11(a)(1) 25 and 25A of the Federal Reserve Act (12 USC sectsect 248(a)(1 ) 602 and 611 a) Section 21113(c) of Regulation K (12 CFR sect 21113(c)) and Section 225S(b) of Regulation Y (12 CFR sect 225S(b)) and section 10(c)(2)(H) of the Home Owners Loan Act Return to the appropriate Federal Reserve Bank the original and the number of copies specified
NOTE The Annual Report of Holding Companies must be signed by one director of the top-tier holding company This individual should also be a senior official of the top-tier holding company In the event that the top-tier holding company does not have an individual who is a senior official and is also a director the chairshyman of the board must sign the report
1 Timothy J Brown Name of the Holding Company Director and Official
President Title of the Holding Company Director and Official
attest that the Annual Report of Holding Companies (including the supporting attachments) for this report date has been preshypared in conformance with the instructions issued by the Federal Reserve System and are true and correct to the best of my knowledge and belief
With respect to information regarding individuals contained in this report the Reporter certifies that it has the authority to provide this information to the Federal Reserve The Reporter also certifies that it has the authority on behalf of each individual to consent or object to public release of information regarding that individual The Federal Reserve may assume in the absence of a request for confidential treatment submitted in accordance with the Boards Rules Regarding Availability of Information 12 CFR Part 261 that the Reporter fil1d individ nt to public release of all details in the report co Fgtiag th
middot middot dual
Signature
of Holding Company Dlfector and 3 - L Date of Signatur e I
For holding companies not registered with the SEC-Indicate status of Annual Report to Shareholders
is included with the FR Y-6 report
D will be sent under separate cover
D is not prepared
For Federal Reserve Bank Use Only
RSSDID 113=oJY CI
This report form is to be filed by all top-tier bank holding compashynies and top-tier savings and loan holding companies organized under US law and by any foreign banking organization that does not meet the requirements of and is not treated as a qualifyshying foreign banking organization under Section 21123 of Regulation K (12 CFR sect 21123) (See page one of the general instructions for more detail of who must file) The Federal Reserve may not conduct or sponsor and an organization (or a person) is not required to respond to an information collection unless it displays a currently valid OMS control number
Date of Report (top-tier holding companys fiscal year-end)
December 31 2014 Month I Day I Year NA Reportes Legal Entity Identifier (LEI) (20-Character LEI Code)
Reporters Name Street and Mailing Address
Commercial Financial Corp
Legal Title of Holding Company
600 Lake Avenue (Mailing Address of the Holding Company) Street I PO Box
Storm Lake IA 50588 City State Zip Code
Physical Location (if different from mailing address)
Person to whom questions about this report should be directed Ronald L Hintz CPA Name
515-222-4400 Area Code I Phone Number I Extension
515-222-4444 Area Code I FAX Number
ronhintzclaconnectcom E-mail Address
---- Title
Address (URL) for the Holding Companys web page
Does the reporter request confidential treatment for any portion of this
submission
0 Yes Please identify the report items to which this request applies
igj No
D In accordance with the instructions on pages GEN-2 and 3 a letter jusUfying the request is being provided
D The information for which confidential treatment is sought is being submitted separately labeled Confidential
Public reporting burden for this information collection is estimated to vary from 13 to 101 hours per response with an average of 525 hours per response including time to gather and maintain data in the required form and to review instructions and complete the information collection Send comments regarding this burden estimate or any other aspect of this collection of Information including suggestions for reducing this burden to Secretary Board or Governors or the Federal Reserve System 20th and C Streets NW Washington DC 20551 and to the Office of Management and Budget Papeiwork Reduction Project (7100-0297) Washington DC 20503
102014
For Use By Tiered Holding Companies
FRY-6 Page 2 of 2
Top-tiered holding companies must list the names mailing address and physical locations of each of their subsidiary holding companies below
Lakes Bancorporation Inc Legal Title of Subsidiary Holding Company Legal Title of Subsidiary Holding Company
600 Lake Avenue (Mailing Address of the Subsidiary Holding Company) Street PO Box (Mailing Address of the Subsidiary Holding Company) Street I PO Box
Storm Lake IA 50588 City State Zip Code City State Zip Code
Physical Location (if different from mailing address) Physical Location (if different from mailing address)
Legal Title of Subsidiary Holding Company Legal Title of Subsidiary Holding Company
(Mailing Address of the Subsidiary Holding Company) Street I PO Box (Mailing Address of the Subsidiary Holding Company) Street I PO Box
City State Zip Code City State Zip Code
Physical Location (if different from mailing address) Physical Location (if different from mailing address)
Legal Title of Subsidiary Holding Company Legal Title of Subsidiary Holding Company
(Mailing Address of the Subsidiary Holding Company) Street I PO Box (Mailing Address of the Subsidiary Holding Company) Street I PO Box
City State Zip Code City State Zip Code
Physical Location (if different from mailing address) Physical Location (if different from mailing address)
Legal Title of Subsidiary Holding Company Legal Title of Subsidiary Holding Company
(Mailing Address of the Subsidiary Holding Company) Street I PO Box (Mailing Address of the Subsidiary Holding Company) Street PO Box
City State Zip Code City State Zip Code
Physical Location (if different from mailing address) Physical Location (if different from mailing address)
122012
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TABLE OF CONTENTS
PAGE
ACCOUNTANTS COMPILATION REPORT 1
FINANCIAL STATEMENTS
Balance Sheets 2 Statements of Operations 3 Statements of Comprehensive lncome 4 Statements of Stockholders Equity 5 Statements of Cash Flows 6
Notes to Financial Statements 7
---middotmiddotmiddot--------------
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CliftonlarsonAllen
Board of Directors Commercial Financial Corp Storm Lake Iowa
Accountants Compilation Report
CliftonlarsonAllen LLP CLAconnectcom
We have compiled the accompanying balance sheets of Commercial Financial Corp (parent company only) as of December 31 2014 and 2013 and the related statements of operations comprehensive income stockholders equity and cash flows for the years then ended We have not audited or reviewed the accompanying financial statements and accordingly do not express an opinion or provide any assurance about whether the financial statements are in accordance with accounting principles generally accepted in the United States of America
Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America and for designing implementing and maintaining internal control relevant to the preparation and fair presentation of the financial statements
Our responsibility is to conduct the compilation in accordance with Statements on Standards for Accounting and Review Services issued by the American Institute of Certified Public Accountants The objective of a compilation is to assist management in presenting financial information in the form of financial statements without undertaking to obtain or provide any assurance that there are no material modifications that should be made to the financial statements During our compilations we did become aware of a departure from accounting principles generally accepted in the United States of America that is described in the following paragraph
As disclosed in Note 1 to the financial statements accounting principles generally accepted in the United States of America require that majority-owned subsidiaries be reported on a consolidated basis Management has informed us that the Company has not consolidated its investment in its majority-owned subsidiaries instead it is reported under the equity method in these financial statements and that if accounting principles generally accepted in the United States of America had been followed total assets and liabilities would have both increased by $588629725 and $591763344 at December 31 2014 and 2013 respectively
LL West Des Moines Iowa March 6 2015
1
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ASSETS Cash
COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
BALANCE SHEETS December 31 2014 and 2013
ASSETS
$ Investments in subsidiaries -
2014
481555
Net equity in net assets of subsidiary 67517276 Excess of cost over net assets of subsidiaries 911572
Notes receivable - related parties 170136 Loans receivable - participation 2000000 Accrued interest receivable 9777 Income tax recoverable 339698 Deferred income taxes Other assets 749766
2013
$ 514943
60973592
167623
6 979 1734263
17000 746003
TOTAL ASSETS $ 72179780 $ 64160403
LIABILITIES AND STOCKHOLDERS EQUITY
LIABILITIES Accrued interest payable Due lo subsidiaries Subordinated debentures payable to nonbank subsidiary Deferred income taxes Dividend payable - Senior Preferred stock
Total liabilities
STOCKHOLDERS EQUITY Senior Non-Cumulative Perpetual Preferred stock
Series A $1000 par value 18000 shares authorized and issued variable dividend
Class A Preferred stock $100 par value 30000 shares authorized and issued 4 annum non-cumulative dividend preference
Class A Common stock no par value 10000000 shares authorized 8394 shares issued and outstanding
Class B Non-voting Common stock no par value 10000000 shares authorized 1370 shares issued and outstanding
Retained earnings Accumulated other comprehensive income
Total stockholders equity
TOTAL LIABILITIES AND STOCKHOLDERS EQUITY
2
$ 7316 325621
8248000 756
45000
8626693
18000000
3000000
1298505
398368 40744799
111415
63553087
$ 72179780
$ 6397 1630203 8248000
9884600
18000000
3000000
1298505
392 140 31412730
172428
54275803
$ 64 160403
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
STATEMENTS OF OPERATIONS Years Ended December 31 2014 and 2013
2014
INCOME Interest and dividend income $ 16996
OPERATING EXPENSES Salaries and benefits 12 935 Interest expense 166480 Professional fees 114475 Other expenses 51862
Total operating expenses 345752
Loss before equity in income of subsidiaries and income tax benefit (328756)
EQUITY IN INCOME OF SUBSIDIARIES 10001319
Income before income tax benefit 9672563
INCOME TAX BENEFIT 111261
NET INCOME $ 9783824
3
2013
$ 13 155
433423 168978
44845 3980
651226
(638071)
2824716
2 186645
207552
$ 2394 197
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
STATEMENTS OF COMPREHENSIVE INCOME Years Ended December 31 2014 and 2013
2014 2013
NET INCOME $ 9783824 $ 2394197
Other comprehensive loss Unrealized gains (losses) on subsidiary
available-for-sale securities Income tax benefit
Total other comprehensive Joss
Total comprehensive income
4
(98409) 37395
(61014)
(412795) 156863
(255932)
$ 9722810 $ 2 138265
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BALANCE DECEMBER 31 2012 Net income
Other comprehensive loss
Redemption of 53 shares of Class B common stock
Issuance of 30 shares of Class B common stock
Dividends declared and paid
BALANCE DECEMBER 31 2013 Net income
Other comprehensive loss
Redemption of 30 shares of Class B common stock
Issuance of 30 shares of Class B common stock
Dividends declared
BALANCE DECEMBER 31 2014
COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
STATEMENTS OF STOCKHOLDERS EQUITY Years Ended December 31 2014 and 2013
Retained Earnings
Accumulated Other
Comprehensive Income
Common Stock Class A Class B
$ 52543726 $ 29438533 $ 428360 $ 1298505 $ 378328 $
2394197
(255932) (81431) 95243
(420000)
54275803 9783824
(61013) (95243) 101471
(451755)
2394197
(420000)
31412730 9783824
(451755)
(255932)
172428 1298505
(61013)
(81431) 95243
392140
(95243) 101471
$ 63 5_53 087 $ 40 744 799 $1h1b1plusmn4gt15 $ 1 298 505 $ 398 368 $
5
Class A Preferred
Stock
Senior Preferred
Stock
3000000 $ 18000000
3000000 18000000
3 000 000 $ 18 000 000
bull bull COMMERCIAL FINANCIAL CORP
(PARENT COMPANY ONLY)
bull STATEMENTS OF CASH FLOWS Years Ended December 31 2014 and 2013
bull bull 2014 2013
bull CASH FLOWS FROM OPERATING ACTIVITIES Net income $ 9783824 $ 2394 197
bull Adjustments to reconcile net income to net cash used in operating activities
bull Equity in earnings of subsidiaries (10001319) (2824716) Losses on other assets 3618 3980
bull Effects of changes in operating assets and liabilities Due to and from subsidiaries (1304582) 1596002
bull Other (14949) Income tax receivable 1394565 (1368384) bull Notes receivable - related parties (2513) 4353
bull Deferred income taxes 17756 Accrued interest receivable (2798) 1391
bull Accrued interest payable 919 (209)
bull Net cash used in operating activities (125479) (193386)
bull CASH FLOWS FROM INVESTING ACTIVITIES Dividends received from subsidiaries 2500000 1250000
bull Loans receivable - participation (2000000) Investment in limited liability company (9382) (650724)
bull Other 2000 1500
bull Net cash provided by investing activities 492618 600776
bull CASH FLOWS FROM FINANCING ACTIVITIES Dividends paid to stockholders (406755) (465000)
bull Proceeds from issuance of Class B common stock 101471 95243
bull Payment to redeem Class B common stock (95243) (81431)
Net cash provided by financing activities (400527) (451 188)
bull NET DECREASE IN CASH (33388) (43798) bull
bull CASH BEGINNING OF YEAR 514943 558741
bull CASH END OF YEAR $ 481555 $ 514943
bull SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
bull Cash paid for interest was $165561 in 2014 and $169 187 in 2013 Cash received for income taxes was $219000 in 2014 and $435 170 in 2013
bull SUPPLEMENTAL DISCLOSURE OF NONCASH FINANCING ACTIVITIES Dividends declared on Senior Preferred stock of $45000 in 2014
bull is included in liabilities
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6
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Commercial Financial Corp (the Company) is an Iowa-based bank holding company At December 31 2014 the Company owns 100 of the voting common stock of Central Bank headquartered in Storm Lake Iowa During 2014 Lakes Bancorporation Inc was merged into Central Bank thereby increasing the Companys direct ownership in Central Bank to 100 Previously the Company owned 65 of Central Bank and 100 of Lakes Bancorporation which owned 35 of Central Bank Central Bank owns 100 of the common stock of Milford Holdings Inc and 100 of the membership interest in Real Estate Owned LLC and Central Florida Real Estate Owned LLC The Company also owns 100 of the common stock of Central Statutory Trust II (Central Statutory Trust)
The principal market areas for the Company and its subsidiaries are Storm Lake Cherokee Spirit Lake Sioux City Des Moines and the surrounding Iowa communities
The Companys subsidiaries make commercial agricultural real estate and installment loans to businesses and individuals as well as maintaining deposits for customers in their market areas
Use of Estimates in Preparing Financial Statements
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period Actual results could vary from those estimates
Investments in Subsidiaries
Accounting standards require the consolidation of majority-owned subsidiaries with the parent for financial reporting purposes Commercial Financial Corps wholly-owned subsidiaries Central Bank and Central Statutory Trust are included in the accompanying financial statements under the equity method rather than consolidated with the Company (See Note 6)
The accompanying financial statements are not intended to replace any consolidated financial statements of Commercial Financial Corp and subsidiaries
NOTE 2 - GROUP CONCENTRATION OF CREDIT RISK
The Companys primary business activity is with Central Bank in Storm Lake Cherokee Spirit Lake Des Moines and Sioux City Iowa The Bank makes commercial agricultural real estate and installment loans to customers in the Storm Lake Cherokee Spirit Lake Des Moines and Sioux City Iowa areas Although the Bank has a diversified loan portfolio a substantial portion of its debtors ability to honor their contracts is dependent upon the agricultural economy
7
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 3 - SUBORDINATED DEBENTURES PAYABLE TO NONBANK SUBSIDIARY
Subordinated debentures payable to nonbank subsidiary at December 31 2014 and 2013 represents indebtedness to Central Statutory Trust II and bears interest at a rate equal to the 3-month LIBOR rate plus 175 At December 31 2014 and 2013 the interest rate was 199 and 199 respectively The principal amounts of the debentures are due June 21 2037
NOTE 4 - INCOME TAXES
The Company and its subsidiaries file consolidated federal and State of Iowa income tax return The subsidiaries provide for income taxes on a separate return basis and remit to the Company amounts determined to be currently payable
The Company follows the accounting requirements for uncertain tax positions The Company determined that no liability related to uncertain tax positions was required as of December 31 2014 and 2013
The federal and state income tax returns of the Company for 2011 and thereafter are subject to examination by the IRS and state taxing authorities generally for three years after they were filed
NOTE 5 - RESTRICTIONS ON SUBSIDIARY DIVIDENDS
The ability of the Company to service its debt is dependent on cash dividends paid to the Company by its subsidiary bank The Bank is a state chartered bank that is also a member of a federal reserve bank The subsidiary bank is subject to certain statutory and regulatory restrictions on the amount it may pay in dividends
A state bank that is registered as a federal reserve bank may not pay a dividend which would impair the capital of the bank A federal reserve member bank is required to obtain prior approval of the Board of Governors of the Federal Reserve System if the total of all dividends including the proposed dividends declared by the bank in any calendar year exceeds the total of the banks net profits of that year combined with its retained net profits of the preceding two years In addition a bank chartered under Iowa law may pay dividends up to the amount of its undivided profits provided its surplus account equals or exceeds its capital account subject to maintenance of minimum capital requirements
8
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 6 - SUBSIDIARY CONDENSED FINANCIAL STATEMENTS
The following is a summary of selected unaudited financial information of Central Bank based upon the December 31 2014 and 2013 financial statements submitted to the Federal Deposit Insurance Corporation
2014 2013
Total assets $ 655686000 $ 651573000
Liabilities $ 588121000 $ 591764000 Stockholders equity 67565000 59809000
Total liabilities and stockholders equity $ 655686000 $ 651573000
Net income $ 10001000 $ 2825000
During 2014 Lakes Bancorporation Inc was merged into Central Bank In connection with the merger the Company recognized $911572 in excess of cost over net assets of subsidiaries (goodwill) which had been previously recognized by Lakes Bancorporation Inc The following is a summary of selected unaudited parent company only financial information of Lakes Bancorporation based on December 31 2013 parent company only financial statements filed with the Federal Reserve System
2013
Total assets $ 21 916000
Liabilities $ Stockholders equity 21 916000
Total liabilities and stockholders equity $ 21 916000
Net income $ 989000
Central Bank owns 100 of the common stock of Milford Holdings Inc The following is a summary of selected unaudited financial information of Milford Holdings Inc
2014 2013
Total assets $ 7660000 $ 7022000
Liabilities $ 31000 $ Stockholders equity 7629000 7022000
Total liabilities and stockholders equity $ 7660000 $ 7022000
Net income $ 607000 $ 370000
9
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 6 - SUBSIDIARY CONDENSED FINANCIAL STATEMENTS (CONTINUED)
During 2013 Central Bank acquired 100 of the membership interest in Real Estate Owned LLC The following is a summary of selected unaudited financial information of Real Estate Owned LLC
2014 2013
Total assets $ 4508000 $ 3456000
Liabilities $ 17000 $ Stockholders equity 4491000 3456000
Total liabilities and stockholders equity $ 4508000 $ 3456000
Net income $ 206000 $
During 2013 Central Bank acquired 100 of the membership interest in Central Florida Real Estate Owned LLC The following is a summary of selected unaudited financial information of Central Florida Real Estate Owned LLC
Total assets
Liabilities Stockholders equity
Total liabilities and stockholders equity
Net income
$
$
$
$
2014 2013
744000 $ 1476000
$ 744000 1476000
744000 $ 1476000
140000 $
The Company owns 100 of the trust common securities of Central Statutory Trust II Central Statutory Trust II was formed to issue Company obligated mandatorily redeemable preferred securities (Preferred Securities) Central Statutory Trust II has issued all of the 8000000 authorized shares of preferred securities The preferred securities are considered liabilities on the balance sheet for Central Statutory Trust II For regulatory purposes a portion of the preferred securities are allowed in the calculation of Tier 1 and Tier 2 capital of the Company
10
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 6 - SUBSIDIARY CONDENSED FINANCIAL STATEMENTS (CONTINUED)
The following is a summary of selected unaudited financial information of Central Statutory Trust II based on December 31 2014 and 2013 quarterly financial statements of nonbank subsidiaries filed with the Federal Reserve System
2014 2013
Total assets $ 8248000 $ 8248000
Liabilities $ 8000000 $ 8000000 Stockholders equity 248000 248000
Total liabilities and stockholders equity $ 8248000 $ 8248000
Net income $ $
NOTE 7 - SENIOR PREFERRED STOCK
The Company executed a Small Business Lending Fund Securities Purchase Agreement with the United States Department of the Treasury (Treasury) effective September 20 2011 Through the Small Business Lending Fund (SBLF) the Treasury provides Tier 1 capital to community banks and other eligible institutions Each institution pays dividend rates that go down as its small business lending goes up
Treasury was issued 18000 shares of Senior Non-Cumulative Perpetual Preferred Stock Series A for $18000000 on September 20 2011 The initial dividend rate was 5 The variable dividend rate may decrease each of the following nine quarters based on the increase in qualified small business lending as defined in the agreement The dividend rate will vary between 1 and 5 as lending increases vary between 10 and 25 The fixed dividend rate for the tenth quarter after funding through the end of the first four and one-half years is set as described above if lending has increased at the end of the eighth quarter after funding If lending has not increased at the end of the eighth quarter after funding the fixed dividend rate is set at 7 The fixed dividend rate after four and one-half years is set at 9 if the funding has not already been repaid The dividend rate at December 31 2014 and 2013 was 1 for both years
The Treasury has a liquidation preference of $1000 per share or $18000000 as of December 31 2014 Dividends are payable quarterly in arrears on January 1 April 1 July 1 and October 1 of each year Dividends payable at December 31 2014 and 2013 are $45000 and $0 respectively The Company may repay the funding at any time with regulatory approval
11
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 8 - ACCUMULATED OTHER COMPREHENSIVE INCOME
Central Bank and Milford Holdings Inc maintain certain securities in an available-for-sale category At December 31 2014 and 2013 combined accumulated other comprehensive income related to available-for-sale securities in the amount of $111415 and $172428 respectively was recorded directly to the Companys stockholders equity for its 100 proportionate share of the other comprehensive income
NOTE 9 - SUBSEQUENT EVENTS
Management evaluated subsequent events through March 6 2015 the date the financial statements were available to be issued Events or transactions occurring after December 31 2014 but prior to March 6 2015 that provided additional evidence about conditions that existed at December 31 2014 have been recognized in the financial statements for the year ended December 31 2014 Events or transactions that provided evidence about conditions that did not exist at December 31 2014 but arose before the financial statements were available to be issued have not been recognized in the financial statements for the year ended December 31 2014
See accountants compilation report
12
COMMERCIAL FINANCIAL CORP
Report - rem J Commercial Fuianc1al Corp is not required to file with the Secunt1es and
Exchange Comfriiksion r bull 1 R
eport
Item 111 Fmancial statenints parent company only of Commercial Fmancial Corp middotI
are attached Cppsolidated financial statements are not prepared h 1 I I fb m t e norma colirtse o usmess
Report-Item 2J U Organizational Chart middot See attabhed chart
Report- Item 2J k Banch Verification l Ii See attced chart
Report-Item 3 l middot middot Listing of sharehfders that directly or indirectly own control or hold with power to v9t 5 or more of any class of shares of the bank holding Company middotmiddotj
gt ll I
Name andAddrJJs J Timothy J Brovampn 1 Storm Lake IoWa I
i
John C Brown f 1 Spirit Lake IovM
1 f - (
Citizenship
1JSA
USA
Report Item 4 -se Schedule Attached
t
l H
il
Class A Common
Shares Owned
5009
3385
Percentage
5967
4033
Class B Common
Shares Owned
1296
44
Percentage
9460
321
ORGANIZATIONAL CHART
Report - Item 2(a) - Organization chart - Commercial Financial Corp Incorporated State of Iowa - Lakes Bancorporation Inc Incorporated State of Iowa - Central Bank Incorporated State of Iowa - Milford Holdings Inc Incorporated State of Iowa - Central Statutory Trust II Deleware Statutory Trust - Real Estate Owned LLC lncorprated State of Iowa - Central Florida Real Estate Owned LLC Incorporated State of Florida - Toss II LLC Incorporated State of Iowa
COMMERCIAL FINANCIAL CORP STORM LAKE IA
Non-Managing M Owns 40
ember
Toss II LLC Stonn Lake IA
Footnotes
Owns 65
CENTRAL BANK
STORM LAKE IA
Owns 100
MILFORD HOLDINGS INC STORM LAKE IA
(See footnote 1)
Lakes Bancorporation Inc
Stonn Lake IA
Owns 35
Managing Member Owns 100
REAL ESTATE OWNED LLC
STORM LAKE IA
1 Commercial Financial Corp owns 5540000 (100) of the outstanding shares of voting common stock
Owns 100
CENTRAL STATUTORY TRUST II
STORM LAKE IA
Managing Memb Owns 100
CENTRAL FLORIDA REAL ESTATE OWNED LLC
STORM LAKE IA
er
Results A list of branches for your holding company COMMERC1ALflNANCJALCORP (1978574) of STORM IAKE IA The data are as of 12312014 Data reflects lnfo1maton that was received and processd through Ol07 2015
Reconcl1alon md Vertncaloo SICli 1 Jn the Data Action column of each branch row enter one or more of the actions specified below 2 If required enter the date In the Effective Date column
Actions OK If the branch Information Is correct enterOK In the Data Action coumn
Change tr the branch Information Is Incorrect or Incomplete revise the data enterOrnnge In the Data Action colllmn and the date when this Information rlrstbecame vaJd In the Effective Dale column Close If a branch lsted was sold or closed enter Clos In the Data Actlori column and the sale or closure date In the Effective Date coumn Delete ]f a branch Med was never owned by this depository Institution enter Odele In the Data Action column Add Jf a reportable branch Is missing Insert a row add the branch data and enterAdd In the Data Action column and the opening or acqulsltfon date In theEHectlve Date column
If printing this Hsi you may need to adjust your pa Be setup In MS Excel Try uslng landscape orientation page scaling andor e(lal siled paper
Submission Procedure When you are finished send a saved copy to your FRB contact See the detailed Instructions on this site for more Information If you are e-malllng th ls to your FRB contact put your Institution name dty and state In the subject tine of the emiddotmall
Note To sltitislythe FR YmiddotlO reporting requirements you must aim submit FR YmiddotlO Domestic Branch Schedules for each branch with a Data Action of Q1ange dose Delete or Add The FR Y-10 report may be submitted In a hardcopy format or via the FR YmiddotlO Onlne applcatlon bull httpsylOonUnefederalreservegov
bull FOCUNINUM Office Number and D_RSSD columns are for reference only Verlflcatron of these values ls not required
Data Action Effective Date Branch Service Type Branch ID RSSDbull Popular Name Street Address City
OK Full Service Head Office) 545544 CENTRAL BANK 600 LAKE AVENUE STORM lAKE OK Full Service 4154B52 ANKENY BOULEVARD BRANCH 2805 NORTH ANKENY BOULEVARD ANKENY
OK Umlted Servke 2116588 CHEROKEE BRANCH 2BOW DRIVE CHEROKEE
OK Full Service 802848 CHEROKEE CENTRAL TRUST BRANCH 401 WEST MAIN STREET CHEROKEE
OK Full Service 2161147 4018 UNIVERSITY AVENUEOFFJCE 4018 UNIVERSITY AVENUE DES MOINES
OK Full Service 4155104 HUBBEL AVENUE BRANCH 2742 HUBBELLAVENUE DES MOINES
OK Full Service 4155270 WALNUT STREETS RANCH 700 WALNUT STREET DES MOINES
OK Full Service 4493169 4201 SOUTH LAKEPORT BRANCH 4201 SOUTH LAKEPORT SIOUX CITY
OK FuI Service 3078064 522 fOURTH STREET BRANCH 522 4TH STREET SIOUX CITY
OK Full Service 3596719 stoux OiY BRANCH 2-906 HAMILTON BLVD SIOUX CITY
OK Full Servke 810142 SPIRIT IAKE BRANCH 1400 1BTH STREET SPIRIT LAKE
OK limited Service 2045050 DRIVEmiddotIN BRANCH 1237 LAKE AVENUE STORM LAKE
OK Full Servke 4155252 URBANDALE BRANCH 3800 lOOTH STREET URBANDALE
OK Full Service 44931SO 6501 WESTOWN PARKWAY BRANCH 6601 WESTOWN PARKWAYSUITE140 WEST DES MOINES
OK Full Service 4639444 ASHWORTH ROAD BRANCH 6139 ASHWORTH ROAD WEST DES MOINES OK Full Service 4155131 MILLS ClVJCPARr-NAY BRANCH 5070 MILLS CIVIC PARKWAY WEST DES MOINES
State Zip Code County IA 505BS BUENA VISTA IA 50023 POLK IA 51012 CHEROKEE IA 51012 CHEROKEE IA 50311 POLK
IA 50317 POLK IA 50309 POLK IA 51106 WOODBURY
IA 51101 WOODBURY
IA 51104 WOODBURY IA Sl360 DICKINSON IA 505BBmiddot19 BUENA VISTA IA 50322 POLK IA S0266 POLK IA 50266 POLK IA 50265 POLK
Country FDICUNINUM+ Office Numberbull Head Offlce Head Office ID RSSDbull Comments UNITED STATES 9849 0 CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544 UNITED STATES 263121 6 CENTRAL BANK 546544 UNITED STATES 6467 3 CENTRAL BANK 545544 UNITED STATES Not Requred Not Required CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544
UNITED STATES Not Required Not Required CENTRAL BANK 546S44 UNITED STATES Not Required Nol Required CENTRAL BANK S46544 UNITED STATES 362876 7 CENTRAL BANK S45544 UNITED STATES 465474 9 CENTRAL BANK S46544
UNITED STATES 9695 8 CENTRAL BANK 546544
UNITED STATES 234537 l CENTRAL BANK 546S44 UNITED STATES Not Required Not Required CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544
UNITED STATES Not Required Not Requred CENTRAL BANK 546544
UNITED STATES Nol Required Not Required CENTRAL BANK 546544
Report Item 4 - Brincipal Shareholders Director Executive Officer ofBaMlHolding Company
1 (1) Name and adhress middoti
(2) Principal oc4Lation if other than with Miaing company
(3) Title or posltion with 1 I (a) Bank ho)g company
I j
(b) See Atta9ped I ( c) Other busfuess companies
l TossLLC Toss IT1f-LC
i Imiddot ( 4) Number of sliitres and percentage
of voting sedrities owned middot controlled oJ eldwith power to vote ii (a) Barik holtlmg company -1
Clas Common Class Common (Nobivoting)
i I (b) Subsidiaries of bank
h ld ti 0 mgmiddot1rmpany
i (c) Otherbusillfss companies
I
TossLic Meser units
Toss II ILLC Member units
I
Timothy J Brown Storm Lake Iowa
NIA
President and Director
Member Member
5009 Shares 5967
1296 Shares 9460
None
1667
1667
John C Brown Spirit Lake Iowa
NIA
Secretary Treasurer and Director
Member Member
3385 Shares 4033
44 Shares 321
None
1667
1667
r
Report Item 4 - Rrincipal Shareholders Director Executive Officer of BanhlEolding Company
middotI
(3) Title or p9itiori with middotI I
bull1 (b) Subsidiaes of
holding 1qompany
Central Bank I I
middot1 ti
Jvlilford Holtljitgs Inc I
i
I
I
middotl 1 i
i
Timothy J Brown Storm Lake Iowa
President and Director
President and Director
John C Brown Spirit Lake Iowa
Executive ViceshyPresident Secretary and Director
Executive ViceshyPtesident Secretary and Director
- FR Y-6 Cover Page
- For Use By Tiered Holding Companies
- Report Item 1 Annual Report to Shareholders
- Report Item 2a Organization Chart
- Report Item 2b Domestic Branch Listing
- Report Item 3 Securities Holders
- Report Item 4 Insiders
-
For Use By Tiered Holding Companies
FRY-6 Page 2 of 2
Top-tiered holding companies must list the names mailing address and physical locations of each of their subsidiary holding companies below
Lakes Bancorporation Inc Legal Title of Subsidiary Holding Company Legal Title of Subsidiary Holding Company
600 Lake Avenue (Mailing Address of the Subsidiary Holding Company) Street PO Box (Mailing Address of the Subsidiary Holding Company) Street I PO Box
Storm Lake IA 50588 City State Zip Code City State Zip Code
Physical Location (if different from mailing address) Physical Location (if different from mailing address)
Legal Title of Subsidiary Holding Company Legal Title of Subsidiary Holding Company
(Mailing Address of the Subsidiary Holding Company) Street I PO Box (Mailing Address of the Subsidiary Holding Company) Street I PO Box
City State Zip Code City State Zip Code
Physical Location (if different from mailing address) Physical Location (if different from mailing address)
Legal Title of Subsidiary Holding Company Legal Title of Subsidiary Holding Company
(Mailing Address of the Subsidiary Holding Company) Street I PO Box (Mailing Address of the Subsidiary Holding Company) Street I PO Box
City State Zip Code City State Zip Code
Physical Location (if different from mailing address) Physical Location (if different from mailing address)
Legal Title of Subsidiary Holding Company Legal Title of Subsidiary Holding Company
(Mailing Address of the Subsidiary Holding Company) Street I PO Box (Mailing Address of the Subsidiary Holding Company) Street PO Box
City State Zip Code City State Zip Code
Physical Location (if different from mailing address) Physical Location (if different from mailing address)
122012
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TABLE OF CONTENTS
PAGE
ACCOUNTANTS COMPILATION REPORT 1
FINANCIAL STATEMENTS
Balance Sheets 2 Statements of Operations 3 Statements of Comprehensive lncome 4 Statements of Stockholders Equity 5 Statements of Cash Flows 6
Notes to Financial Statements 7
---middotmiddotmiddot--------------
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CliftonlarsonAllen
Board of Directors Commercial Financial Corp Storm Lake Iowa
Accountants Compilation Report
CliftonlarsonAllen LLP CLAconnectcom
We have compiled the accompanying balance sheets of Commercial Financial Corp (parent company only) as of December 31 2014 and 2013 and the related statements of operations comprehensive income stockholders equity and cash flows for the years then ended We have not audited or reviewed the accompanying financial statements and accordingly do not express an opinion or provide any assurance about whether the financial statements are in accordance with accounting principles generally accepted in the United States of America
Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America and for designing implementing and maintaining internal control relevant to the preparation and fair presentation of the financial statements
Our responsibility is to conduct the compilation in accordance with Statements on Standards for Accounting and Review Services issued by the American Institute of Certified Public Accountants The objective of a compilation is to assist management in presenting financial information in the form of financial statements without undertaking to obtain or provide any assurance that there are no material modifications that should be made to the financial statements During our compilations we did become aware of a departure from accounting principles generally accepted in the United States of America that is described in the following paragraph
As disclosed in Note 1 to the financial statements accounting principles generally accepted in the United States of America require that majority-owned subsidiaries be reported on a consolidated basis Management has informed us that the Company has not consolidated its investment in its majority-owned subsidiaries instead it is reported under the equity method in these financial statements and that if accounting principles generally accepted in the United States of America had been followed total assets and liabilities would have both increased by $588629725 and $591763344 at December 31 2014 and 2013 respectively
LL West Des Moines Iowa March 6 2015
1
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ASSETS Cash
COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
BALANCE SHEETS December 31 2014 and 2013
ASSETS
$ Investments in subsidiaries -
2014
481555
Net equity in net assets of subsidiary 67517276 Excess of cost over net assets of subsidiaries 911572
Notes receivable - related parties 170136 Loans receivable - participation 2000000 Accrued interest receivable 9777 Income tax recoverable 339698 Deferred income taxes Other assets 749766
2013
$ 514943
60973592
167623
6 979 1734263
17000 746003
TOTAL ASSETS $ 72179780 $ 64160403
LIABILITIES AND STOCKHOLDERS EQUITY
LIABILITIES Accrued interest payable Due lo subsidiaries Subordinated debentures payable to nonbank subsidiary Deferred income taxes Dividend payable - Senior Preferred stock
Total liabilities
STOCKHOLDERS EQUITY Senior Non-Cumulative Perpetual Preferred stock
Series A $1000 par value 18000 shares authorized and issued variable dividend
Class A Preferred stock $100 par value 30000 shares authorized and issued 4 annum non-cumulative dividend preference
Class A Common stock no par value 10000000 shares authorized 8394 shares issued and outstanding
Class B Non-voting Common stock no par value 10000000 shares authorized 1370 shares issued and outstanding
Retained earnings Accumulated other comprehensive income
Total stockholders equity
TOTAL LIABILITIES AND STOCKHOLDERS EQUITY
2
$ 7316 325621
8248000 756
45000
8626693
18000000
3000000
1298505
398368 40744799
111415
63553087
$ 72179780
$ 6397 1630203 8248000
9884600
18000000
3000000
1298505
392 140 31412730
172428
54275803
$ 64 160403
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
STATEMENTS OF OPERATIONS Years Ended December 31 2014 and 2013
2014
INCOME Interest and dividend income $ 16996
OPERATING EXPENSES Salaries and benefits 12 935 Interest expense 166480 Professional fees 114475 Other expenses 51862
Total operating expenses 345752
Loss before equity in income of subsidiaries and income tax benefit (328756)
EQUITY IN INCOME OF SUBSIDIARIES 10001319
Income before income tax benefit 9672563
INCOME TAX BENEFIT 111261
NET INCOME $ 9783824
3
2013
$ 13 155
433423 168978
44845 3980
651226
(638071)
2824716
2 186645
207552
$ 2394 197
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
STATEMENTS OF COMPREHENSIVE INCOME Years Ended December 31 2014 and 2013
2014 2013
NET INCOME $ 9783824 $ 2394197
Other comprehensive loss Unrealized gains (losses) on subsidiary
available-for-sale securities Income tax benefit
Total other comprehensive Joss
Total comprehensive income
4
(98409) 37395
(61014)
(412795) 156863
(255932)
$ 9722810 $ 2 138265
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BALANCE DECEMBER 31 2012 Net income
Other comprehensive loss
Redemption of 53 shares of Class B common stock
Issuance of 30 shares of Class B common stock
Dividends declared and paid
BALANCE DECEMBER 31 2013 Net income
Other comprehensive loss
Redemption of 30 shares of Class B common stock
Issuance of 30 shares of Class B common stock
Dividends declared
BALANCE DECEMBER 31 2014
COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
STATEMENTS OF STOCKHOLDERS EQUITY Years Ended December 31 2014 and 2013
Retained Earnings
Accumulated Other
Comprehensive Income
Common Stock Class A Class B
$ 52543726 $ 29438533 $ 428360 $ 1298505 $ 378328 $
2394197
(255932) (81431) 95243
(420000)
54275803 9783824
(61013) (95243) 101471
(451755)
2394197
(420000)
31412730 9783824
(451755)
(255932)
172428 1298505
(61013)
(81431) 95243
392140
(95243) 101471
$ 63 5_53 087 $ 40 744 799 $1h1b1plusmn4gt15 $ 1 298 505 $ 398 368 $
5
Class A Preferred
Stock
Senior Preferred
Stock
3000000 $ 18000000
3000000 18000000
3 000 000 $ 18 000 000
bull bull COMMERCIAL FINANCIAL CORP
(PARENT COMPANY ONLY)
bull STATEMENTS OF CASH FLOWS Years Ended December 31 2014 and 2013
bull bull 2014 2013
bull CASH FLOWS FROM OPERATING ACTIVITIES Net income $ 9783824 $ 2394 197
bull Adjustments to reconcile net income to net cash used in operating activities
bull Equity in earnings of subsidiaries (10001319) (2824716) Losses on other assets 3618 3980
bull Effects of changes in operating assets and liabilities Due to and from subsidiaries (1304582) 1596002
bull Other (14949) Income tax receivable 1394565 (1368384) bull Notes receivable - related parties (2513) 4353
bull Deferred income taxes 17756 Accrued interest receivable (2798) 1391
bull Accrued interest payable 919 (209)
bull Net cash used in operating activities (125479) (193386)
bull CASH FLOWS FROM INVESTING ACTIVITIES Dividends received from subsidiaries 2500000 1250000
bull Loans receivable - participation (2000000) Investment in limited liability company (9382) (650724)
bull Other 2000 1500
bull Net cash provided by investing activities 492618 600776
bull CASH FLOWS FROM FINANCING ACTIVITIES Dividends paid to stockholders (406755) (465000)
bull Proceeds from issuance of Class B common stock 101471 95243
bull Payment to redeem Class B common stock (95243) (81431)
Net cash provided by financing activities (400527) (451 188)
bull NET DECREASE IN CASH (33388) (43798) bull
bull CASH BEGINNING OF YEAR 514943 558741
bull CASH END OF YEAR $ 481555 $ 514943
bull SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
bull Cash paid for interest was $165561 in 2014 and $169 187 in 2013 Cash received for income taxes was $219000 in 2014 and $435 170 in 2013
bull SUPPLEMENTAL DISCLOSURE OF NONCASH FINANCING ACTIVITIES Dividends declared on Senior Preferred stock of $45000 in 2014
bull is included in liabilities
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6
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Commercial Financial Corp (the Company) is an Iowa-based bank holding company At December 31 2014 the Company owns 100 of the voting common stock of Central Bank headquartered in Storm Lake Iowa During 2014 Lakes Bancorporation Inc was merged into Central Bank thereby increasing the Companys direct ownership in Central Bank to 100 Previously the Company owned 65 of Central Bank and 100 of Lakes Bancorporation which owned 35 of Central Bank Central Bank owns 100 of the common stock of Milford Holdings Inc and 100 of the membership interest in Real Estate Owned LLC and Central Florida Real Estate Owned LLC The Company also owns 100 of the common stock of Central Statutory Trust II (Central Statutory Trust)
The principal market areas for the Company and its subsidiaries are Storm Lake Cherokee Spirit Lake Sioux City Des Moines and the surrounding Iowa communities
The Companys subsidiaries make commercial agricultural real estate and installment loans to businesses and individuals as well as maintaining deposits for customers in their market areas
Use of Estimates in Preparing Financial Statements
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period Actual results could vary from those estimates
Investments in Subsidiaries
Accounting standards require the consolidation of majority-owned subsidiaries with the parent for financial reporting purposes Commercial Financial Corps wholly-owned subsidiaries Central Bank and Central Statutory Trust are included in the accompanying financial statements under the equity method rather than consolidated with the Company (See Note 6)
The accompanying financial statements are not intended to replace any consolidated financial statements of Commercial Financial Corp and subsidiaries
NOTE 2 - GROUP CONCENTRATION OF CREDIT RISK
The Companys primary business activity is with Central Bank in Storm Lake Cherokee Spirit Lake Des Moines and Sioux City Iowa The Bank makes commercial agricultural real estate and installment loans to customers in the Storm Lake Cherokee Spirit Lake Des Moines and Sioux City Iowa areas Although the Bank has a diversified loan portfolio a substantial portion of its debtors ability to honor their contracts is dependent upon the agricultural economy
7
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 3 - SUBORDINATED DEBENTURES PAYABLE TO NONBANK SUBSIDIARY
Subordinated debentures payable to nonbank subsidiary at December 31 2014 and 2013 represents indebtedness to Central Statutory Trust II and bears interest at a rate equal to the 3-month LIBOR rate plus 175 At December 31 2014 and 2013 the interest rate was 199 and 199 respectively The principal amounts of the debentures are due June 21 2037
NOTE 4 - INCOME TAXES
The Company and its subsidiaries file consolidated federal and State of Iowa income tax return The subsidiaries provide for income taxes on a separate return basis and remit to the Company amounts determined to be currently payable
The Company follows the accounting requirements for uncertain tax positions The Company determined that no liability related to uncertain tax positions was required as of December 31 2014 and 2013
The federal and state income tax returns of the Company for 2011 and thereafter are subject to examination by the IRS and state taxing authorities generally for three years after they were filed
NOTE 5 - RESTRICTIONS ON SUBSIDIARY DIVIDENDS
The ability of the Company to service its debt is dependent on cash dividends paid to the Company by its subsidiary bank The Bank is a state chartered bank that is also a member of a federal reserve bank The subsidiary bank is subject to certain statutory and regulatory restrictions on the amount it may pay in dividends
A state bank that is registered as a federal reserve bank may not pay a dividend which would impair the capital of the bank A federal reserve member bank is required to obtain prior approval of the Board of Governors of the Federal Reserve System if the total of all dividends including the proposed dividends declared by the bank in any calendar year exceeds the total of the banks net profits of that year combined with its retained net profits of the preceding two years In addition a bank chartered under Iowa law may pay dividends up to the amount of its undivided profits provided its surplus account equals or exceeds its capital account subject to maintenance of minimum capital requirements
8
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 6 - SUBSIDIARY CONDENSED FINANCIAL STATEMENTS
The following is a summary of selected unaudited financial information of Central Bank based upon the December 31 2014 and 2013 financial statements submitted to the Federal Deposit Insurance Corporation
2014 2013
Total assets $ 655686000 $ 651573000
Liabilities $ 588121000 $ 591764000 Stockholders equity 67565000 59809000
Total liabilities and stockholders equity $ 655686000 $ 651573000
Net income $ 10001000 $ 2825000
During 2014 Lakes Bancorporation Inc was merged into Central Bank In connection with the merger the Company recognized $911572 in excess of cost over net assets of subsidiaries (goodwill) which had been previously recognized by Lakes Bancorporation Inc The following is a summary of selected unaudited parent company only financial information of Lakes Bancorporation based on December 31 2013 parent company only financial statements filed with the Federal Reserve System
2013
Total assets $ 21 916000
Liabilities $ Stockholders equity 21 916000
Total liabilities and stockholders equity $ 21 916000
Net income $ 989000
Central Bank owns 100 of the common stock of Milford Holdings Inc The following is a summary of selected unaudited financial information of Milford Holdings Inc
2014 2013
Total assets $ 7660000 $ 7022000
Liabilities $ 31000 $ Stockholders equity 7629000 7022000
Total liabilities and stockholders equity $ 7660000 $ 7022000
Net income $ 607000 $ 370000
9
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 6 - SUBSIDIARY CONDENSED FINANCIAL STATEMENTS (CONTINUED)
During 2013 Central Bank acquired 100 of the membership interest in Real Estate Owned LLC The following is a summary of selected unaudited financial information of Real Estate Owned LLC
2014 2013
Total assets $ 4508000 $ 3456000
Liabilities $ 17000 $ Stockholders equity 4491000 3456000
Total liabilities and stockholders equity $ 4508000 $ 3456000
Net income $ 206000 $
During 2013 Central Bank acquired 100 of the membership interest in Central Florida Real Estate Owned LLC The following is a summary of selected unaudited financial information of Central Florida Real Estate Owned LLC
Total assets
Liabilities Stockholders equity
Total liabilities and stockholders equity
Net income
$
$
$
$
2014 2013
744000 $ 1476000
$ 744000 1476000
744000 $ 1476000
140000 $
The Company owns 100 of the trust common securities of Central Statutory Trust II Central Statutory Trust II was formed to issue Company obligated mandatorily redeemable preferred securities (Preferred Securities) Central Statutory Trust II has issued all of the 8000000 authorized shares of preferred securities The preferred securities are considered liabilities on the balance sheet for Central Statutory Trust II For regulatory purposes a portion of the preferred securities are allowed in the calculation of Tier 1 and Tier 2 capital of the Company
10
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 6 - SUBSIDIARY CONDENSED FINANCIAL STATEMENTS (CONTINUED)
The following is a summary of selected unaudited financial information of Central Statutory Trust II based on December 31 2014 and 2013 quarterly financial statements of nonbank subsidiaries filed with the Federal Reserve System
2014 2013
Total assets $ 8248000 $ 8248000
Liabilities $ 8000000 $ 8000000 Stockholders equity 248000 248000
Total liabilities and stockholders equity $ 8248000 $ 8248000
Net income $ $
NOTE 7 - SENIOR PREFERRED STOCK
The Company executed a Small Business Lending Fund Securities Purchase Agreement with the United States Department of the Treasury (Treasury) effective September 20 2011 Through the Small Business Lending Fund (SBLF) the Treasury provides Tier 1 capital to community banks and other eligible institutions Each institution pays dividend rates that go down as its small business lending goes up
Treasury was issued 18000 shares of Senior Non-Cumulative Perpetual Preferred Stock Series A for $18000000 on September 20 2011 The initial dividend rate was 5 The variable dividend rate may decrease each of the following nine quarters based on the increase in qualified small business lending as defined in the agreement The dividend rate will vary between 1 and 5 as lending increases vary between 10 and 25 The fixed dividend rate for the tenth quarter after funding through the end of the first four and one-half years is set as described above if lending has increased at the end of the eighth quarter after funding If lending has not increased at the end of the eighth quarter after funding the fixed dividend rate is set at 7 The fixed dividend rate after four and one-half years is set at 9 if the funding has not already been repaid The dividend rate at December 31 2014 and 2013 was 1 for both years
The Treasury has a liquidation preference of $1000 per share or $18000000 as of December 31 2014 Dividends are payable quarterly in arrears on January 1 April 1 July 1 and October 1 of each year Dividends payable at December 31 2014 and 2013 are $45000 and $0 respectively The Company may repay the funding at any time with regulatory approval
11
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 8 - ACCUMULATED OTHER COMPREHENSIVE INCOME
Central Bank and Milford Holdings Inc maintain certain securities in an available-for-sale category At December 31 2014 and 2013 combined accumulated other comprehensive income related to available-for-sale securities in the amount of $111415 and $172428 respectively was recorded directly to the Companys stockholders equity for its 100 proportionate share of the other comprehensive income
NOTE 9 - SUBSEQUENT EVENTS
Management evaluated subsequent events through March 6 2015 the date the financial statements were available to be issued Events or transactions occurring after December 31 2014 but prior to March 6 2015 that provided additional evidence about conditions that existed at December 31 2014 have been recognized in the financial statements for the year ended December 31 2014 Events or transactions that provided evidence about conditions that did not exist at December 31 2014 but arose before the financial statements were available to be issued have not been recognized in the financial statements for the year ended December 31 2014
See accountants compilation report
12
COMMERCIAL FINANCIAL CORP
Report - rem J Commercial Fuianc1al Corp is not required to file with the Secunt1es and
Exchange Comfriiksion r bull 1 R
eport
Item 111 Fmancial statenints parent company only of Commercial Fmancial Corp middotI
are attached Cppsolidated financial statements are not prepared h 1 I I fb m t e norma colirtse o usmess
Report-Item 2J U Organizational Chart middot See attabhed chart
Report- Item 2J k Banch Verification l Ii See attced chart
Report-Item 3 l middot middot Listing of sharehfders that directly or indirectly own control or hold with power to v9t 5 or more of any class of shares of the bank holding Company middotmiddotj
gt ll I
Name andAddrJJs J Timothy J Brovampn 1 Storm Lake IoWa I
i
John C Brown f 1 Spirit Lake IovM
1 f - (
Citizenship
1JSA
USA
Report Item 4 -se Schedule Attached
t
l H
il
Class A Common
Shares Owned
5009
3385
Percentage
5967
4033
Class B Common
Shares Owned
1296
44
Percentage
9460
321
ORGANIZATIONAL CHART
Report - Item 2(a) - Organization chart - Commercial Financial Corp Incorporated State of Iowa - Lakes Bancorporation Inc Incorporated State of Iowa - Central Bank Incorporated State of Iowa - Milford Holdings Inc Incorporated State of Iowa - Central Statutory Trust II Deleware Statutory Trust - Real Estate Owned LLC lncorprated State of Iowa - Central Florida Real Estate Owned LLC Incorporated State of Florida - Toss II LLC Incorporated State of Iowa
COMMERCIAL FINANCIAL CORP STORM LAKE IA
Non-Managing M Owns 40
ember
Toss II LLC Stonn Lake IA
Footnotes
Owns 65
CENTRAL BANK
STORM LAKE IA
Owns 100
MILFORD HOLDINGS INC STORM LAKE IA
(See footnote 1)
Lakes Bancorporation Inc
Stonn Lake IA
Owns 35
Managing Member Owns 100
REAL ESTATE OWNED LLC
STORM LAKE IA
1 Commercial Financial Corp owns 5540000 (100) of the outstanding shares of voting common stock
Owns 100
CENTRAL STATUTORY TRUST II
STORM LAKE IA
Managing Memb Owns 100
CENTRAL FLORIDA REAL ESTATE OWNED LLC
STORM LAKE IA
er
Results A list of branches for your holding company COMMERC1ALflNANCJALCORP (1978574) of STORM IAKE IA The data are as of 12312014 Data reflects lnfo1maton that was received and processd through Ol07 2015
Reconcl1alon md Vertncaloo SICli 1 Jn the Data Action column of each branch row enter one or more of the actions specified below 2 If required enter the date In the Effective Date column
Actions OK If the branch Information Is correct enterOK In the Data Action coumn
Change tr the branch Information Is Incorrect or Incomplete revise the data enterOrnnge In the Data Action colllmn and the date when this Information rlrstbecame vaJd In the Effective Dale column Close If a branch lsted was sold or closed enter Clos In the Data Actlori column and the sale or closure date In the Effective Date coumn Delete ]f a branch Med was never owned by this depository Institution enter Odele In the Data Action column Add Jf a reportable branch Is missing Insert a row add the branch data and enterAdd In the Data Action column and the opening or acqulsltfon date In theEHectlve Date column
If printing this Hsi you may need to adjust your pa Be setup In MS Excel Try uslng landscape orientation page scaling andor e(lal siled paper
Submission Procedure When you are finished send a saved copy to your FRB contact See the detailed Instructions on this site for more Information If you are e-malllng th ls to your FRB contact put your Institution name dty and state In the subject tine of the emiddotmall
Note To sltitislythe FR YmiddotlO reporting requirements you must aim submit FR YmiddotlO Domestic Branch Schedules for each branch with a Data Action of Q1ange dose Delete or Add The FR Y-10 report may be submitted In a hardcopy format or via the FR YmiddotlO Onlne applcatlon bull httpsylOonUnefederalreservegov
bull FOCUNINUM Office Number and D_RSSD columns are for reference only Verlflcatron of these values ls not required
Data Action Effective Date Branch Service Type Branch ID RSSDbull Popular Name Street Address City
OK Full Service Head Office) 545544 CENTRAL BANK 600 LAKE AVENUE STORM lAKE OK Full Service 4154B52 ANKENY BOULEVARD BRANCH 2805 NORTH ANKENY BOULEVARD ANKENY
OK Umlted Servke 2116588 CHEROKEE BRANCH 2BOW DRIVE CHEROKEE
OK Full Service 802848 CHEROKEE CENTRAL TRUST BRANCH 401 WEST MAIN STREET CHEROKEE
OK Full Service 2161147 4018 UNIVERSITY AVENUEOFFJCE 4018 UNIVERSITY AVENUE DES MOINES
OK Full Service 4155104 HUBBEL AVENUE BRANCH 2742 HUBBELLAVENUE DES MOINES
OK Full Service 4155270 WALNUT STREETS RANCH 700 WALNUT STREET DES MOINES
OK Full Service 4493169 4201 SOUTH LAKEPORT BRANCH 4201 SOUTH LAKEPORT SIOUX CITY
OK FuI Service 3078064 522 fOURTH STREET BRANCH 522 4TH STREET SIOUX CITY
OK Full Service 3596719 stoux OiY BRANCH 2-906 HAMILTON BLVD SIOUX CITY
OK Full Servke 810142 SPIRIT IAKE BRANCH 1400 1BTH STREET SPIRIT LAKE
OK limited Service 2045050 DRIVEmiddotIN BRANCH 1237 LAKE AVENUE STORM LAKE
OK Full Servke 4155252 URBANDALE BRANCH 3800 lOOTH STREET URBANDALE
OK Full Service 44931SO 6501 WESTOWN PARKWAY BRANCH 6601 WESTOWN PARKWAYSUITE140 WEST DES MOINES
OK Full Service 4639444 ASHWORTH ROAD BRANCH 6139 ASHWORTH ROAD WEST DES MOINES OK Full Service 4155131 MILLS ClVJCPARr-NAY BRANCH 5070 MILLS CIVIC PARKWAY WEST DES MOINES
State Zip Code County IA 505BS BUENA VISTA IA 50023 POLK IA 51012 CHEROKEE IA 51012 CHEROKEE IA 50311 POLK
IA 50317 POLK IA 50309 POLK IA 51106 WOODBURY
IA 51101 WOODBURY
IA 51104 WOODBURY IA Sl360 DICKINSON IA 505BBmiddot19 BUENA VISTA IA 50322 POLK IA S0266 POLK IA 50266 POLK IA 50265 POLK
Country FDICUNINUM+ Office Numberbull Head Offlce Head Office ID RSSDbull Comments UNITED STATES 9849 0 CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544 UNITED STATES 263121 6 CENTRAL BANK 546544 UNITED STATES 6467 3 CENTRAL BANK 545544 UNITED STATES Not Requred Not Required CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544
UNITED STATES Not Required Not Required CENTRAL BANK 546S44 UNITED STATES Not Required Nol Required CENTRAL BANK S46544 UNITED STATES 362876 7 CENTRAL BANK S45544 UNITED STATES 465474 9 CENTRAL BANK S46544
UNITED STATES 9695 8 CENTRAL BANK 546544
UNITED STATES 234537 l CENTRAL BANK 546S44 UNITED STATES Not Required Not Required CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544
UNITED STATES Not Required Not Requred CENTRAL BANK 546544
UNITED STATES Nol Required Not Required CENTRAL BANK 546544
Report Item 4 - Brincipal Shareholders Director Executive Officer ofBaMlHolding Company
1 (1) Name and adhress middoti
(2) Principal oc4Lation if other than with Miaing company
(3) Title or posltion with 1 I (a) Bank ho)g company
I j
(b) See Atta9ped I ( c) Other busfuess companies
l TossLLC Toss IT1f-LC
i Imiddot ( 4) Number of sliitres and percentage
of voting sedrities owned middot controlled oJ eldwith power to vote ii (a) Barik holtlmg company -1
Clas Common Class Common (Nobivoting)
i I (b) Subsidiaries of bank
h ld ti 0 mgmiddot1rmpany
i (c) Otherbusillfss companies
I
TossLic Meser units
Toss II ILLC Member units
I
Timothy J Brown Storm Lake Iowa
NIA
President and Director
Member Member
5009 Shares 5967
1296 Shares 9460
None
1667
1667
John C Brown Spirit Lake Iowa
NIA
Secretary Treasurer and Director
Member Member
3385 Shares 4033
44 Shares 321
None
1667
1667
r
Report Item 4 - Rrincipal Shareholders Director Executive Officer of BanhlEolding Company
middotI
(3) Title or p9itiori with middotI I
bull1 (b) Subsidiaes of
holding 1qompany
Central Bank I I
middot1 ti
Jvlilford Holtljitgs Inc I
i
I
I
middotl 1 i
i
Timothy J Brown Storm Lake Iowa
President and Director
President and Director
John C Brown Spirit Lake Iowa
Executive ViceshyPresident Secretary and Director
Executive ViceshyPtesident Secretary and Director
- FR Y-6 Cover Page
- For Use By Tiered Holding Companies
- Report Item 1 Annual Report to Shareholders
- Report Item 2a Organization Chart
- Report Item 2b Domestic Branch Listing
- Report Item 3 Securities Holders
- Report Item 4 Insiders
-
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TABLE OF CONTENTS
PAGE
ACCOUNTANTS COMPILATION REPORT 1
FINANCIAL STATEMENTS
Balance Sheets 2 Statements of Operations 3 Statements of Comprehensive lncome 4 Statements of Stockholders Equity 5 Statements of Cash Flows 6
Notes to Financial Statements 7
---middotmiddotmiddot--------------
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CliftonlarsonAllen
Board of Directors Commercial Financial Corp Storm Lake Iowa
Accountants Compilation Report
CliftonlarsonAllen LLP CLAconnectcom
We have compiled the accompanying balance sheets of Commercial Financial Corp (parent company only) as of December 31 2014 and 2013 and the related statements of operations comprehensive income stockholders equity and cash flows for the years then ended We have not audited or reviewed the accompanying financial statements and accordingly do not express an opinion or provide any assurance about whether the financial statements are in accordance with accounting principles generally accepted in the United States of America
Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America and for designing implementing and maintaining internal control relevant to the preparation and fair presentation of the financial statements
Our responsibility is to conduct the compilation in accordance with Statements on Standards for Accounting and Review Services issued by the American Institute of Certified Public Accountants The objective of a compilation is to assist management in presenting financial information in the form of financial statements without undertaking to obtain or provide any assurance that there are no material modifications that should be made to the financial statements During our compilations we did become aware of a departure from accounting principles generally accepted in the United States of America that is described in the following paragraph
As disclosed in Note 1 to the financial statements accounting principles generally accepted in the United States of America require that majority-owned subsidiaries be reported on a consolidated basis Management has informed us that the Company has not consolidated its investment in its majority-owned subsidiaries instead it is reported under the equity method in these financial statements and that if accounting principles generally accepted in the United States of America had been followed total assets and liabilities would have both increased by $588629725 and $591763344 at December 31 2014 and 2013 respectively
LL West Des Moines Iowa March 6 2015
1
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ASSETS Cash
COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
BALANCE SHEETS December 31 2014 and 2013
ASSETS
$ Investments in subsidiaries -
2014
481555
Net equity in net assets of subsidiary 67517276 Excess of cost over net assets of subsidiaries 911572
Notes receivable - related parties 170136 Loans receivable - participation 2000000 Accrued interest receivable 9777 Income tax recoverable 339698 Deferred income taxes Other assets 749766
2013
$ 514943
60973592
167623
6 979 1734263
17000 746003
TOTAL ASSETS $ 72179780 $ 64160403
LIABILITIES AND STOCKHOLDERS EQUITY
LIABILITIES Accrued interest payable Due lo subsidiaries Subordinated debentures payable to nonbank subsidiary Deferred income taxes Dividend payable - Senior Preferred stock
Total liabilities
STOCKHOLDERS EQUITY Senior Non-Cumulative Perpetual Preferred stock
Series A $1000 par value 18000 shares authorized and issued variable dividend
Class A Preferred stock $100 par value 30000 shares authorized and issued 4 annum non-cumulative dividend preference
Class A Common stock no par value 10000000 shares authorized 8394 shares issued and outstanding
Class B Non-voting Common stock no par value 10000000 shares authorized 1370 shares issued and outstanding
Retained earnings Accumulated other comprehensive income
Total stockholders equity
TOTAL LIABILITIES AND STOCKHOLDERS EQUITY
2
$ 7316 325621
8248000 756
45000
8626693
18000000
3000000
1298505
398368 40744799
111415
63553087
$ 72179780
$ 6397 1630203 8248000
9884600
18000000
3000000
1298505
392 140 31412730
172428
54275803
$ 64 160403
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
STATEMENTS OF OPERATIONS Years Ended December 31 2014 and 2013
2014
INCOME Interest and dividend income $ 16996
OPERATING EXPENSES Salaries and benefits 12 935 Interest expense 166480 Professional fees 114475 Other expenses 51862
Total operating expenses 345752
Loss before equity in income of subsidiaries and income tax benefit (328756)
EQUITY IN INCOME OF SUBSIDIARIES 10001319
Income before income tax benefit 9672563
INCOME TAX BENEFIT 111261
NET INCOME $ 9783824
3
2013
$ 13 155
433423 168978
44845 3980
651226
(638071)
2824716
2 186645
207552
$ 2394 197
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
STATEMENTS OF COMPREHENSIVE INCOME Years Ended December 31 2014 and 2013
2014 2013
NET INCOME $ 9783824 $ 2394197
Other comprehensive loss Unrealized gains (losses) on subsidiary
available-for-sale securities Income tax benefit
Total other comprehensive Joss
Total comprehensive income
4
(98409) 37395
(61014)
(412795) 156863
(255932)
$ 9722810 $ 2 138265
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BALANCE DECEMBER 31 2012 Net income
Other comprehensive loss
Redemption of 53 shares of Class B common stock
Issuance of 30 shares of Class B common stock
Dividends declared and paid
BALANCE DECEMBER 31 2013 Net income
Other comprehensive loss
Redemption of 30 shares of Class B common stock
Issuance of 30 shares of Class B common stock
Dividends declared
BALANCE DECEMBER 31 2014
COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
STATEMENTS OF STOCKHOLDERS EQUITY Years Ended December 31 2014 and 2013
Retained Earnings
Accumulated Other
Comprehensive Income
Common Stock Class A Class B
$ 52543726 $ 29438533 $ 428360 $ 1298505 $ 378328 $
2394197
(255932) (81431) 95243
(420000)
54275803 9783824
(61013) (95243) 101471
(451755)
2394197
(420000)
31412730 9783824
(451755)
(255932)
172428 1298505
(61013)
(81431) 95243
392140
(95243) 101471
$ 63 5_53 087 $ 40 744 799 $1h1b1plusmn4gt15 $ 1 298 505 $ 398 368 $
5
Class A Preferred
Stock
Senior Preferred
Stock
3000000 $ 18000000
3000000 18000000
3 000 000 $ 18 000 000
bull bull COMMERCIAL FINANCIAL CORP
(PARENT COMPANY ONLY)
bull STATEMENTS OF CASH FLOWS Years Ended December 31 2014 and 2013
bull bull 2014 2013
bull CASH FLOWS FROM OPERATING ACTIVITIES Net income $ 9783824 $ 2394 197
bull Adjustments to reconcile net income to net cash used in operating activities
bull Equity in earnings of subsidiaries (10001319) (2824716) Losses on other assets 3618 3980
bull Effects of changes in operating assets and liabilities Due to and from subsidiaries (1304582) 1596002
bull Other (14949) Income tax receivable 1394565 (1368384) bull Notes receivable - related parties (2513) 4353
bull Deferred income taxes 17756 Accrued interest receivable (2798) 1391
bull Accrued interest payable 919 (209)
bull Net cash used in operating activities (125479) (193386)
bull CASH FLOWS FROM INVESTING ACTIVITIES Dividends received from subsidiaries 2500000 1250000
bull Loans receivable - participation (2000000) Investment in limited liability company (9382) (650724)
bull Other 2000 1500
bull Net cash provided by investing activities 492618 600776
bull CASH FLOWS FROM FINANCING ACTIVITIES Dividends paid to stockholders (406755) (465000)
bull Proceeds from issuance of Class B common stock 101471 95243
bull Payment to redeem Class B common stock (95243) (81431)
Net cash provided by financing activities (400527) (451 188)
bull NET DECREASE IN CASH (33388) (43798) bull
bull CASH BEGINNING OF YEAR 514943 558741
bull CASH END OF YEAR $ 481555 $ 514943
bull SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
bull Cash paid for interest was $165561 in 2014 and $169 187 in 2013 Cash received for income taxes was $219000 in 2014 and $435 170 in 2013
bull SUPPLEMENTAL DISCLOSURE OF NONCASH FINANCING ACTIVITIES Dividends declared on Senior Preferred stock of $45000 in 2014
bull is included in liabilities
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6
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Commercial Financial Corp (the Company) is an Iowa-based bank holding company At December 31 2014 the Company owns 100 of the voting common stock of Central Bank headquartered in Storm Lake Iowa During 2014 Lakes Bancorporation Inc was merged into Central Bank thereby increasing the Companys direct ownership in Central Bank to 100 Previously the Company owned 65 of Central Bank and 100 of Lakes Bancorporation which owned 35 of Central Bank Central Bank owns 100 of the common stock of Milford Holdings Inc and 100 of the membership interest in Real Estate Owned LLC and Central Florida Real Estate Owned LLC The Company also owns 100 of the common stock of Central Statutory Trust II (Central Statutory Trust)
The principal market areas for the Company and its subsidiaries are Storm Lake Cherokee Spirit Lake Sioux City Des Moines and the surrounding Iowa communities
The Companys subsidiaries make commercial agricultural real estate and installment loans to businesses and individuals as well as maintaining deposits for customers in their market areas
Use of Estimates in Preparing Financial Statements
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period Actual results could vary from those estimates
Investments in Subsidiaries
Accounting standards require the consolidation of majority-owned subsidiaries with the parent for financial reporting purposes Commercial Financial Corps wholly-owned subsidiaries Central Bank and Central Statutory Trust are included in the accompanying financial statements under the equity method rather than consolidated with the Company (See Note 6)
The accompanying financial statements are not intended to replace any consolidated financial statements of Commercial Financial Corp and subsidiaries
NOTE 2 - GROUP CONCENTRATION OF CREDIT RISK
The Companys primary business activity is with Central Bank in Storm Lake Cherokee Spirit Lake Des Moines and Sioux City Iowa The Bank makes commercial agricultural real estate and installment loans to customers in the Storm Lake Cherokee Spirit Lake Des Moines and Sioux City Iowa areas Although the Bank has a diversified loan portfolio a substantial portion of its debtors ability to honor their contracts is dependent upon the agricultural economy
7
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 3 - SUBORDINATED DEBENTURES PAYABLE TO NONBANK SUBSIDIARY
Subordinated debentures payable to nonbank subsidiary at December 31 2014 and 2013 represents indebtedness to Central Statutory Trust II and bears interest at a rate equal to the 3-month LIBOR rate plus 175 At December 31 2014 and 2013 the interest rate was 199 and 199 respectively The principal amounts of the debentures are due June 21 2037
NOTE 4 - INCOME TAXES
The Company and its subsidiaries file consolidated federal and State of Iowa income tax return The subsidiaries provide for income taxes on a separate return basis and remit to the Company amounts determined to be currently payable
The Company follows the accounting requirements for uncertain tax positions The Company determined that no liability related to uncertain tax positions was required as of December 31 2014 and 2013
The federal and state income tax returns of the Company for 2011 and thereafter are subject to examination by the IRS and state taxing authorities generally for three years after they were filed
NOTE 5 - RESTRICTIONS ON SUBSIDIARY DIVIDENDS
The ability of the Company to service its debt is dependent on cash dividends paid to the Company by its subsidiary bank The Bank is a state chartered bank that is also a member of a federal reserve bank The subsidiary bank is subject to certain statutory and regulatory restrictions on the amount it may pay in dividends
A state bank that is registered as a federal reserve bank may not pay a dividend which would impair the capital of the bank A federal reserve member bank is required to obtain prior approval of the Board of Governors of the Federal Reserve System if the total of all dividends including the proposed dividends declared by the bank in any calendar year exceeds the total of the banks net profits of that year combined with its retained net profits of the preceding two years In addition a bank chartered under Iowa law may pay dividends up to the amount of its undivided profits provided its surplus account equals or exceeds its capital account subject to maintenance of minimum capital requirements
8
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 6 - SUBSIDIARY CONDENSED FINANCIAL STATEMENTS
The following is a summary of selected unaudited financial information of Central Bank based upon the December 31 2014 and 2013 financial statements submitted to the Federal Deposit Insurance Corporation
2014 2013
Total assets $ 655686000 $ 651573000
Liabilities $ 588121000 $ 591764000 Stockholders equity 67565000 59809000
Total liabilities and stockholders equity $ 655686000 $ 651573000
Net income $ 10001000 $ 2825000
During 2014 Lakes Bancorporation Inc was merged into Central Bank In connection with the merger the Company recognized $911572 in excess of cost over net assets of subsidiaries (goodwill) which had been previously recognized by Lakes Bancorporation Inc The following is a summary of selected unaudited parent company only financial information of Lakes Bancorporation based on December 31 2013 parent company only financial statements filed with the Federal Reserve System
2013
Total assets $ 21 916000
Liabilities $ Stockholders equity 21 916000
Total liabilities and stockholders equity $ 21 916000
Net income $ 989000
Central Bank owns 100 of the common stock of Milford Holdings Inc The following is a summary of selected unaudited financial information of Milford Holdings Inc
2014 2013
Total assets $ 7660000 $ 7022000
Liabilities $ 31000 $ Stockholders equity 7629000 7022000
Total liabilities and stockholders equity $ 7660000 $ 7022000
Net income $ 607000 $ 370000
9
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 6 - SUBSIDIARY CONDENSED FINANCIAL STATEMENTS (CONTINUED)
During 2013 Central Bank acquired 100 of the membership interest in Real Estate Owned LLC The following is a summary of selected unaudited financial information of Real Estate Owned LLC
2014 2013
Total assets $ 4508000 $ 3456000
Liabilities $ 17000 $ Stockholders equity 4491000 3456000
Total liabilities and stockholders equity $ 4508000 $ 3456000
Net income $ 206000 $
During 2013 Central Bank acquired 100 of the membership interest in Central Florida Real Estate Owned LLC The following is a summary of selected unaudited financial information of Central Florida Real Estate Owned LLC
Total assets
Liabilities Stockholders equity
Total liabilities and stockholders equity
Net income
$
$
$
$
2014 2013
744000 $ 1476000
$ 744000 1476000
744000 $ 1476000
140000 $
The Company owns 100 of the trust common securities of Central Statutory Trust II Central Statutory Trust II was formed to issue Company obligated mandatorily redeemable preferred securities (Preferred Securities) Central Statutory Trust II has issued all of the 8000000 authorized shares of preferred securities The preferred securities are considered liabilities on the balance sheet for Central Statutory Trust II For regulatory purposes a portion of the preferred securities are allowed in the calculation of Tier 1 and Tier 2 capital of the Company
10
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 6 - SUBSIDIARY CONDENSED FINANCIAL STATEMENTS (CONTINUED)
The following is a summary of selected unaudited financial information of Central Statutory Trust II based on December 31 2014 and 2013 quarterly financial statements of nonbank subsidiaries filed with the Federal Reserve System
2014 2013
Total assets $ 8248000 $ 8248000
Liabilities $ 8000000 $ 8000000 Stockholders equity 248000 248000
Total liabilities and stockholders equity $ 8248000 $ 8248000
Net income $ $
NOTE 7 - SENIOR PREFERRED STOCK
The Company executed a Small Business Lending Fund Securities Purchase Agreement with the United States Department of the Treasury (Treasury) effective September 20 2011 Through the Small Business Lending Fund (SBLF) the Treasury provides Tier 1 capital to community banks and other eligible institutions Each institution pays dividend rates that go down as its small business lending goes up
Treasury was issued 18000 shares of Senior Non-Cumulative Perpetual Preferred Stock Series A for $18000000 on September 20 2011 The initial dividend rate was 5 The variable dividend rate may decrease each of the following nine quarters based on the increase in qualified small business lending as defined in the agreement The dividend rate will vary between 1 and 5 as lending increases vary between 10 and 25 The fixed dividend rate for the tenth quarter after funding through the end of the first four and one-half years is set as described above if lending has increased at the end of the eighth quarter after funding If lending has not increased at the end of the eighth quarter after funding the fixed dividend rate is set at 7 The fixed dividend rate after four and one-half years is set at 9 if the funding has not already been repaid The dividend rate at December 31 2014 and 2013 was 1 for both years
The Treasury has a liquidation preference of $1000 per share or $18000000 as of December 31 2014 Dividends are payable quarterly in arrears on January 1 April 1 July 1 and October 1 of each year Dividends payable at December 31 2014 and 2013 are $45000 and $0 respectively The Company may repay the funding at any time with regulatory approval
11
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 8 - ACCUMULATED OTHER COMPREHENSIVE INCOME
Central Bank and Milford Holdings Inc maintain certain securities in an available-for-sale category At December 31 2014 and 2013 combined accumulated other comprehensive income related to available-for-sale securities in the amount of $111415 and $172428 respectively was recorded directly to the Companys stockholders equity for its 100 proportionate share of the other comprehensive income
NOTE 9 - SUBSEQUENT EVENTS
Management evaluated subsequent events through March 6 2015 the date the financial statements were available to be issued Events or transactions occurring after December 31 2014 but prior to March 6 2015 that provided additional evidence about conditions that existed at December 31 2014 have been recognized in the financial statements for the year ended December 31 2014 Events or transactions that provided evidence about conditions that did not exist at December 31 2014 but arose before the financial statements were available to be issued have not been recognized in the financial statements for the year ended December 31 2014
See accountants compilation report
12
COMMERCIAL FINANCIAL CORP
Report - rem J Commercial Fuianc1al Corp is not required to file with the Secunt1es and
Exchange Comfriiksion r bull 1 R
eport
Item 111 Fmancial statenints parent company only of Commercial Fmancial Corp middotI
are attached Cppsolidated financial statements are not prepared h 1 I I fb m t e norma colirtse o usmess
Report-Item 2J U Organizational Chart middot See attabhed chart
Report- Item 2J k Banch Verification l Ii See attced chart
Report-Item 3 l middot middot Listing of sharehfders that directly or indirectly own control or hold with power to v9t 5 or more of any class of shares of the bank holding Company middotmiddotj
gt ll I
Name andAddrJJs J Timothy J Brovampn 1 Storm Lake IoWa I
i
John C Brown f 1 Spirit Lake IovM
1 f - (
Citizenship
1JSA
USA
Report Item 4 -se Schedule Attached
t
l H
il
Class A Common
Shares Owned
5009
3385
Percentage
5967
4033
Class B Common
Shares Owned
1296
44
Percentage
9460
321
ORGANIZATIONAL CHART
Report - Item 2(a) - Organization chart - Commercial Financial Corp Incorporated State of Iowa - Lakes Bancorporation Inc Incorporated State of Iowa - Central Bank Incorporated State of Iowa - Milford Holdings Inc Incorporated State of Iowa - Central Statutory Trust II Deleware Statutory Trust - Real Estate Owned LLC lncorprated State of Iowa - Central Florida Real Estate Owned LLC Incorporated State of Florida - Toss II LLC Incorporated State of Iowa
COMMERCIAL FINANCIAL CORP STORM LAKE IA
Non-Managing M Owns 40
ember
Toss II LLC Stonn Lake IA
Footnotes
Owns 65
CENTRAL BANK
STORM LAKE IA
Owns 100
MILFORD HOLDINGS INC STORM LAKE IA
(See footnote 1)
Lakes Bancorporation Inc
Stonn Lake IA
Owns 35
Managing Member Owns 100
REAL ESTATE OWNED LLC
STORM LAKE IA
1 Commercial Financial Corp owns 5540000 (100) of the outstanding shares of voting common stock
Owns 100
CENTRAL STATUTORY TRUST II
STORM LAKE IA
Managing Memb Owns 100
CENTRAL FLORIDA REAL ESTATE OWNED LLC
STORM LAKE IA
er
Results A list of branches for your holding company COMMERC1ALflNANCJALCORP (1978574) of STORM IAKE IA The data are as of 12312014 Data reflects lnfo1maton that was received and processd through Ol07 2015
Reconcl1alon md Vertncaloo SICli 1 Jn the Data Action column of each branch row enter one or more of the actions specified below 2 If required enter the date In the Effective Date column
Actions OK If the branch Information Is correct enterOK In the Data Action coumn
Change tr the branch Information Is Incorrect or Incomplete revise the data enterOrnnge In the Data Action colllmn and the date when this Information rlrstbecame vaJd In the Effective Dale column Close If a branch lsted was sold or closed enter Clos In the Data Actlori column and the sale or closure date In the Effective Date coumn Delete ]f a branch Med was never owned by this depository Institution enter Odele In the Data Action column Add Jf a reportable branch Is missing Insert a row add the branch data and enterAdd In the Data Action column and the opening or acqulsltfon date In theEHectlve Date column
If printing this Hsi you may need to adjust your pa Be setup In MS Excel Try uslng landscape orientation page scaling andor e(lal siled paper
Submission Procedure When you are finished send a saved copy to your FRB contact See the detailed Instructions on this site for more Information If you are e-malllng th ls to your FRB contact put your Institution name dty and state In the subject tine of the emiddotmall
Note To sltitislythe FR YmiddotlO reporting requirements you must aim submit FR YmiddotlO Domestic Branch Schedules for each branch with a Data Action of Q1ange dose Delete or Add The FR Y-10 report may be submitted In a hardcopy format or via the FR YmiddotlO Onlne applcatlon bull httpsylOonUnefederalreservegov
bull FOCUNINUM Office Number and D_RSSD columns are for reference only Verlflcatron of these values ls not required
Data Action Effective Date Branch Service Type Branch ID RSSDbull Popular Name Street Address City
OK Full Service Head Office) 545544 CENTRAL BANK 600 LAKE AVENUE STORM lAKE OK Full Service 4154B52 ANKENY BOULEVARD BRANCH 2805 NORTH ANKENY BOULEVARD ANKENY
OK Umlted Servke 2116588 CHEROKEE BRANCH 2BOW DRIVE CHEROKEE
OK Full Service 802848 CHEROKEE CENTRAL TRUST BRANCH 401 WEST MAIN STREET CHEROKEE
OK Full Service 2161147 4018 UNIVERSITY AVENUEOFFJCE 4018 UNIVERSITY AVENUE DES MOINES
OK Full Service 4155104 HUBBEL AVENUE BRANCH 2742 HUBBELLAVENUE DES MOINES
OK Full Service 4155270 WALNUT STREETS RANCH 700 WALNUT STREET DES MOINES
OK Full Service 4493169 4201 SOUTH LAKEPORT BRANCH 4201 SOUTH LAKEPORT SIOUX CITY
OK FuI Service 3078064 522 fOURTH STREET BRANCH 522 4TH STREET SIOUX CITY
OK Full Service 3596719 stoux OiY BRANCH 2-906 HAMILTON BLVD SIOUX CITY
OK Full Servke 810142 SPIRIT IAKE BRANCH 1400 1BTH STREET SPIRIT LAKE
OK limited Service 2045050 DRIVEmiddotIN BRANCH 1237 LAKE AVENUE STORM LAKE
OK Full Servke 4155252 URBANDALE BRANCH 3800 lOOTH STREET URBANDALE
OK Full Service 44931SO 6501 WESTOWN PARKWAY BRANCH 6601 WESTOWN PARKWAYSUITE140 WEST DES MOINES
OK Full Service 4639444 ASHWORTH ROAD BRANCH 6139 ASHWORTH ROAD WEST DES MOINES OK Full Service 4155131 MILLS ClVJCPARr-NAY BRANCH 5070 MILLS CIVIC PARKWAY WEST DES MOINES
State Zip Code County IA 505BS BUENA VISTA IA 50023 POLK IA 51012 CHEROKEE IA 51012 CHEROKEE IA 50311 POLK
IA 50317 POLK IA 50309 POLK IA 51106 WOODBURY
IA 51101 WOODBURY
IA 51104 WOODBURY IA Sl360 DICKINSON IA 505BBmiddot19 BUENA VISTA IA 50322 POLK IA S0266 POLK IA 50266 POLK IA 50265 POLK
Country FDICUNINUM+ Office Numberbull Head Offlce Head Office ID RSSDbull Comments UNITED STATES 9849 0 CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544 UNITED STATES 263121 6 CENTRAL BANK 546544 UNITED STATES 6467 3 CENTRAL BANK 545544 UNITED STATES Not Requred Not Required CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544
UNITED STATES Not Required Not Required CENTRAL BANK 546S44 UNITED STATES Not Required Nol Required CENTRAL BANK S46544 UNITED STATES 362876 7 CENTRAL BANK S45544 UNITED STATES 465474 9 CENTRAL BANK S46544
UNITED STATES 9695 8 CENTRAL BANK 546544
UNITED STATES 234537 l CENTRAL BANK 546S44 UNITED STATES Not Required Not Required CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544
UNITED STATES Not Required Not Requred CENTRAL BANK 546544
UNITED STATES Nol Required Not Required CENTRAL BANK 546544
Report Item 4 - Brincipal Shareholders Director Executive Officer ofBaMlHolding Company
1 (1) Name and adhress middoti
(2) Principal oc4Lation if other than with Miaing company
(3) Title or posltion with 1 I (a) Bank ho)g company
I j
(b) See Atta9ped I ( c) Other busfuess companies
l TossLLC Toss IT1f-LC
i Imiddot ( 4) Number of sliitres and percentage
of voting sedrities owned middot controlled oJ eldwith power to vote ii (a) Barik holtlmg company -1
Clas Common Class Common (Nobivoting)
i I (b) Subsidiaries of bank
h ld ti 0 mgmiddot1rmpany
i (c) Otherbusillfss companies
I
TossLic Meser units
Toss II ILLC Member units
I
Timothy J Brown Storm Lake Iowa
NIA
President and Director
Member Member
5009 Shares 5967
1296 Shares 9460
None
1667
1667
John C Brown Spirit Lake Iowa
NIA
Secretary Treasurer and Director
Member Member
3385 Shares 4033
44 Shares 321
None
1667
1667
r
Report Item 4 - Rrincipal Shareholders Director Executive Officer of BanhlEolding Company
middotI
(3) Title or p9itiori with middotI I
bull1 (b) Subsidiaes of
holding 1qompany
Central Bank I I
middot1 ti
Jvlilford Holtljitgs Inc I
i
I
I
middotl 1 i
i
Timothy J Brown Storm Lake Iowa
President and Director
President and Director
John C Brown Spirit Lake Iowa
Executive ViceshyPresident Secretary and Director
Executive ViceshyPtesident Secretary and Director
- FR Y-6 Cover Page
- For Use By Tiered Holding Companies
- Report Item 1 Annual Report to Shareholders
- Report Item 2a Organization Chart
- Report Item 2b Domestic Branch Listing
- Report Item 3 Securities Holders
- Report Item 4 Insiders
-
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CliftonlarsonAllen
Board of Directors Commercial Financial Corp Storm Lake Iowa
Accountants Compilation Report
CliftonlarsonAllen LLP CLAconnectcom
We have compiled the accompanying balance sheets of Commercial Financial Corp (parent company only) as of December 31 2014 and 2013 and the related statements of operations comprehensive income stockholders equity and cash flows for the years then ended We have not audited or reviewed the accompanying financial statements and accordingly do not express an opinion or provide any assurance about whether the financial statements are in accordance with accounting principles generally accepted in the United States of America
Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America and for designing implementing and maintaining internal control relevant to the preparation and fair presentation of the financial statements
Our responsibility is to conduct the compilation in accordance with Statements on Standards for Accounting and Review Services issued by the American Institute of Certified Public Accountants The objective of a compilation is to assist management in presenting financial information in the form of financial statements without undertaking to obtain or provide any assurance that there are no material modifications that should be made to the financial statements During our compilations we did become aware of a departure from accounting principles generally accepted in the United States of America that is described in the following paragraph
As disclosed in Note 1 to the financial statements accounting principles generally accepted in the United States of America require that majority-owned subsidiaries be reported on a consolidated basis Management has informed us that the Company has not consolidated its investment in its majority-owned subsidiaries instead it is reported under the equity method in these financial statements and that if accounting principles generally accepted in the United States of America had been followed total assets and liabilities would have both increased by $588629725 and $591763344 at December 31 2014 and 2013 respectively
LL West Des Moines Iowa March 6 2015
1
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ASSETS Cash
COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
BALANCE SHEETS December 31 2014 and 2013
ASSETS
$ Investments in subsidiaries -
2014
481555
Net equity in net assets of subsidiary 67517276 Excess of cost over net assets of subsidiaries 911572
Notes receivable - related parties 170136 Loans receivable - participation 2000000 Accrued interest receivable 9777 Income tax recoverable 339698 Deferred income taxes Other assets 749766
2013
$ 514943
60973592
167623
6 979 1734263
17000 746003
TOTAL ASSETS $ 72179780 $ 64160403
LIABILITIES AND STOCKHOLDERS EQUITY
LIABILITIES Accrued interest payable Due lo subsidiaries Subordinated debentures payable to nonbank subsidiary Deferred income taxes Dividend payable - Senior Preferred stock
Total liabilities
STOCKHOLDERS EQUITY Senior Non-Cumulative Perpetual Preferred stock
Series A $1000 par value 18000 shares authorized and issued variable dividend
Class A Preferred stock $100 par value 30000 shares authorized and issued 4 annum non-cumulative dividend preference
Class A Common stock no par value 10000000 shares authorized 8394 shares issued and outstanding
Class B Non-voting Common stock no par value 10000000 shares authorized 1370 shares issued and outstanding
Retained earnings Accumulated other comprehensive income
Total stockholders equity
TOTAL LIABILITIES AND STOCKHOLDERS EQUITY
2
$ 7316 325621
8248000 756
45000
8626693
18000000
3000000
1298505
398368 40744799
111415
63553087
$ 72179780
$ 6397 1630203 8248000
9884600
18000000
3000000
1298505
392 140 31412730
172428
54275803
$ 64 160403
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
STATEMENTS OF OPERATIONS Years Ended December 31 2014 and 2013
2014
INCOME Interest and dividend income $ 16996
OPERATING EXPENSES Salaries and benefits 12 935 Interest expense 166480 Professional fees 114475 Other expenses 51862
Total operating expenses 345752
Loss before equity in income of subsidiaries and income tax benefit (328756)
EQUITY IN INCOME OF SUBSIDIARIES 10001319
Income before income tax benefit 9672563
INCOME TAX BENEFIT 111261
NET INCOME $ 9783824
3
2013
$ 13 155
433423 168978
44845 3980
651226
(638071)
2824716
2 186645
207552
$ 2394 197
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
STATEMENTS OF COMPREHENSIVE INCOME Years Ended December 31 2014 and 2013
2014 2013
NET INCOME $ 9783824 $ 2394197
Other comprehensive loss Unrealized gains (losses) on subsidiary
available-for-sale securities Income tax benefit
Total other comprehensive Joss
Total comprehensive income
4
(98409) 37395
(61014)
(412795) 156863
(255932)
$ 9722810 $ 2 138265
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BALANCE DECEMBER 31 2012 Net income
Other comprehensive loss
Redemption of 53 shares of Class B common stock
Issuance of 30 shares of Class B common stock
Dividends declared and paid
BALANCE DECEMBER 31 2013 Net income
Other comprehensive loss
Redemption of 30 shares of Class B common stock
Issuance of 30 shares of Class B common stock
Dividends declared
BALANCE DECEMBER 31 2014
COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
STATEMENTS OF STOCKHOLDERS EQUITY Years Ended December 31 2014 and 2013
Retained Earnings
Accumulated Other
Comprehensive Income
Common Stock Class A Class B
$ 52543726 $ 29438533 $ 428360 $ 1298505 $ 378328 $
2394197
(255932) (81431) 95243
(420000)
54275803 9783824
(61013) (95243) 101471
(451755)
2394197
(420000)
31412730 9783824
(451755)
(255932)
172428 1298505
(61013)
(81431) 95243
392140
(95243) 101471
$ 63 5_53 087 $ 40 744 799 $1h1b1plusmn4gt15 $ 1 298 505 $ 398 368 $
5
Class A Preferred
Stock
Senior Preferred
Stock
3000000 $ 18000000
3000000 18000000
3 000 000 $ 18 000 000
bull bull COMMERCIAL FINANCIAL CORP
(PARENT COMPANY ONLY)
bull STATEMENTS OF CASH FLOWS Years Ended December 31 2014 and 2013
bull bull 2014 2013
bull CASH FLOWS FROM OPERATING ACTIVITIES Net income $ 9783824 $ 2394 197
bull Adjustments to reconcile net income to net cash used in operating activities
bull Equity in earnings of subsidiaries (10001319) (2824716) Losses on other assets 3618 3980
bull Effects of changes in operating assets and liabilities Due to and from subsidiaries (1304582) 1596002
bull Other (14949) Income tax receivable 1394565 (1368384) bull Notes receivable - related parties (2513) 4353
bull Deferred income taxes 17756 Accrued interest receivable (2798) 1391
bull Accrued interest payable 919 (209)
bull Net cash used in operating activities (125479) (193386)
bull CASH FLOWS FROM INVESTING ACTIVITIES Dividends received from subsidiaries 2500000 1250000
bull Loans receivable - participation (2000000) Investment in limited liability company (9382) (650724)
bull Other 2000 1500
bull Net cash provided by investing activities 492618 600776
bull CASH FLOWS FROM FINANCING ACTIVITIES Dividends paid to stockholders (406755) (465000)
bull Proceeds from issuance of Class B common stock 101471 95243
bull Payment to redeem Class B common stock (95243) (81431)
Net cash provided by financing activities (400527) (451 188)
bull NET DECREASE IN CASH (33388) (43798) bull
bull CASH BEGINNING OF YEAR 514943 558741
bull CASH END OF YEAR $ 481555 $ 514943
bull SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
bull Cash paid for interest was $165561 in 2014 and $169 187 in 2013 Cash received for income taxes was $219000 in 2014 and $435 170 in 2013
bull SUPPLEMENTAL DISCLOSURE OF NONCASH FINANCING ACTIVITIES Dividends declared on Senior Preferred stock of $45000 in 2014
bull is included in liabilities
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6
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Commercial Financial Corp (the Company) is an Iowa-based bank holding company At December 31 2014 the Company owns 100 of the voting common stock of Central Bank headquartered in Storm Lake Iowa During 2014 Lakes Bancorporation Inc was merged into Central Bank thereby increasing the Companys direct ownership in Central Bank to 100 Previously the Company owned 65 of Central Bank and 100 of Lakes Bancorporation which owned 35 of Central Bank Central Bank owns 100 of the common stock of Milford Holdings Inc and 100 of the membership interest in Real Estate Owned LLC and Central Florida Real Estate Owned LLC The Company also owns 100 of the common stock of Central Statutory Trust II (Central Statutory Trust)
The principal market areas for the Company and its subsidiaries are Storm Lake Cherokee Spirit Lake Sioux City Des Moines and the surrounding Iowa communities
The Companys subsidiaries make commercial agricultural real estate and installment loans to businesses and individuals as well as maintaining deposits for customers in their market areas
Use of Estimates in Preparing Financial Statements
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period Actual results could vary from those estimates
Investments in Subsidiaries
Accounting standards require the consolidation of majority-owned subsidiaries with the parent for financial reporting purposes Commercial Financial Corps wholly-owned subsidiaries Central Bank and Central Statutory Trust are included in the accompanying financial statements under the equity method rather than consolidated with the Company (See Note 6)
The accompanying financial statements are not intended to replace any consolidated financial statements of Commercial Financial Corp and subsidiaries
NOTE 2 - GROUP CONCENTRATION OF CREDIT RISK
The Companys primary business activity is with Central Bank in Storm Lake Cherokee Spirit Lake Des Moines and Sioux City Iowa The Bank makes commercial agricultural real estate and installment loans to customers in the Storm Lake Cherokee Spirit Lake Des Moines and Sioux City Iowa areas Although the Bank has a diversified loan portfolio a substantial portion of its debtors ability to honor their contracts is dependent upon the agricultural economy
7
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 3 - SUBORDINATED DEBENTURES PAYABLE TO NONBANK SUBSIDIARY
Subordinated debentures payable to nonbank subsidiary at December 31 2014 and 2013 represents indebtedness to Central Statutory Trust II and bears interest at a rate equal to the 3-month LIBOR rate plus 175 At December 31 2014 and 2013 the interest rate was 199 and 199 respectively The principal amounts of the debentures are due June 21 2037
NOTE 4 - INCOME TAXES
The Company and its subsidiaries file consolidated federal and State of Iowa income tax return The subsidiaries provide for income taxes on a separate return basis and remit to the Company amounts determined to be currently payable
The Company follows the accounting requirements for uncertain tax positions The Company determined that no liability related to uncertain tax positions was required as of December 31 2014 and 2013
The federal and state income tax returns of the Company for 2011 and thereafter are subject to examination by the IRS and state taxing authorities generally for three years after they were filed
NOTE 5 - RESTRICTIONS ON SUBSIDIARY DIVIDENDS
The ability of the Company to service its debt is dependent on cash dividends paid to the Company by its subsidiary bank The Bank is a state chartered bank that is also a member of a federal reserve bank The subsidiary bank is subject to certain statutory and regulatory restrictions on the amount it may pay in dividends
A state bank that is registered as a federal reserve bank may not pay a dividend which would impair the capital of the bank A federal reserve member bank is required to obtain prior approval of the Board of Governors of the Federal Reserve System if the total of all dividends including the proposed dividends declared by the bank in any calendar year exceeds the total of the banks net profits of that year combined with its retained net profits of the preceding two years In addition a bank chartered under Iowa law may pay dividends up to the amount of its undivided profits provided its surplus account equals or exceeds its capital account subject to maintenance of minimum capital requirements
8
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 6 - SUBSIDIARY CONDENSED FINANCIAL STATEMENTS
The following is a summary of selected unaudited financial information of Central Bank based upon the December 31 2014 and 2013 financial statements submitted to the Federal Deposit Insurance Corporation
2014 2013
Total assets $ 655686000 $ 651573000
Liabilities $ 588121000 $ 591764000 Stockholders equity 67565000 59809000
Total liabilities and stockholders equity $ 655686000 $ 651573000
Net income $ 10001000 $ 2825000
During 2014 Lakes Bancorporation Inc was merged into Central Bank In connection with the merger the Company recognized $911572 in excess of cost over net assets of subsidiaries (goodwill) which had been previously recognized by Lakes Bancorporation Inc The following is a summary of selected unaudited parent company only financial information of Lakes Bancorporation based on December 31 2013 parent company only financial statements filed with the Federal Reserve System
2013
Total assets $ 21 916000
Liabilities $ Stockholders equity 21 916000
Total liabilities and stockholders equity $ 21 916000
Net income $ 989000
Central Bank owns 100 of the common stock of Milford Holdings Inc The following is a summary of selected unaudited financial information of Milford Holdings Inc
2014 2013
Total assets $ 7660000 $ 7022000
Liabilities $ 31000 $ Stockholders equity 7629000 7022000
Total liabilities and stockholders equity $ 7660000 $ 7022000
Net income $ 607000 $ 370000
9
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 6 - SUBSIDIARY CONDENSED FINANCIAL STATEMENTS (CONTINUED)
During 2013 Central Bank acquired 100 of the membership interest in Real Estate Owned LLC The following is a summary of selected unaudited financial information of Real Estate Owned LLC
2014 2013
Total assets $ 4508000 $ 3456000
Liabilities $ 17000 $ Stockholders equity 4491000 3456000
Total liabilities and stockholders equity $ 4508000 $ 3456000
Net income $ 206000 $
During 2013 Central Bank acquired 100 of the membership interest in Central Florida Real Estate Owned LLC The following is a summary of selected unaudited financial information of Central Florida Real Estate Owned LLC
Total assets
Liabilities Stockholders equity
Total liabilities and stockholders equity
Net income
$
$
$
$
2014 2013
744000 $ 1476000
$ 744000 1476000
744000 $ 1476000
140000 $
The Company owns 100 of the trust common securities of Central Statutory Trust II Central Statutory Trust II was formed to issue Company obligated mandatorily redeemable preferred securities (Preferred Securities) Central Statutory Trust II has issued all of the 8000000 authorized shares of preferred securities The preferred securities are considered liabilities on the balance sheet for Central Statutory Trust II For regulatory purposes a portion of the preferred securities are allowed in the calculation of Tier 1 and Tier 2 capital of the Company
10
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 6 - SUBSIDIARY CONDENSED FINANCIAL STATEMENTS (CONTINUED)
The following is a summary of selected unaudited financial information of Central Statutory Trust II based on December 31 2014 and 2013 quarterly financial statements of nonbank subsidiaries filed with the Federal Reserve System
2014 2013
Total assets $ 8248000 $ 8248000
Liabilities $ 8000000 $ 8000000 Stockholders equity 248000 248000
Total liabilities and stockholders equity $ 8248000 $ 8248000
Net income $ $
NOTE 7 - SENIOR PREFERRED STOCK
The Company executed a Small Business Lending Fund Securities Purchase Agreement with the United States Department of the Treasury (Treasury) effective September 20 2011 Through the Small Business Lending Fund (SBLF) the Treasury provides Tier 1 capital to community banks and other eligible institutions Each institution pays dividend rates that go down as its small business lending goes up
Treasury was issued 18000 shares of Senior Non-Cumulative Perpetual Preferred Stock Series A for $18000000 on September 20 2011 The initial dividend rate was 5 The variable dividend rate may decrease each of the following nine quarters based on the increase in qualified small business lending as defined in the agreement The dividend rate will vary between 1 and 5 as lending increases vary between 10 and 25 The fixed dividend rate for the tenth quarter after funding through the end of the first four and one-half years is set as described above if lending has increased at the end of the eighth quarter after funding If lending has not increased at the end of the eighth quarter after funding the fixed dividend rate is set at 7 The fixed dividend rate after four and one-half years is set at 9 if the funding has not already been repaid The dividend rate at December 31 2014 and 2013 was 1 for both years
The Treasury has a liquidation preference of $1000 per share or $18000000 as of December 31 2014 Dividends are payable quarterly in arrears on January 1 April 1 July 1 and October 1 of each year Dividends payable at December 31 2014 and 2013 are $45000 and $0 respectively The Company may repay the funding at any time with regulatory approval
11
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 8 - ACCUMULATED OTHER COMPREHENSIVE INCOME
Central Bank and Milford Holdings Inc maintain certain securities in an available-for-sale category At December 31 2014 and 2013 combined accumulated other comprehensive income related to available-for-sale securities in the amount of $111415 and $172428 respectively was recorded directly to the Companys stockholders equity for its 100 proportionate share of the other comprehensive income
NOTE 9 - SUBSEQUENT EVENTS
Management evaluated subsequent events through March 6 2015 the date the financial statements were available to be issued Events or transactions occurring after December 31 2014 but prior to March 6 2015 that provided additional evidence about conditions that existed at December 31 2014 have been recognized in the financial statements for the year ended December 31 2014 Events or transactions that provided evidence about conditions that did not exist at December 31 2014 but arose before the financial statements were available to be issued have not been recognized in the financial statements for the year ended December 31 2014
See accountants compilation report
12
COMMERCIAL FINANCIAL CORP
Report - rem J Commercial Fuianc1al Corp is not required to file with the Secunt1es and
Exchange Comfriiksion r bull 1 R
eport
Item 111 Fmancial statenints parent company only of Commercial Fmancial Corp middotI
are attached Cppsolidated financial statements are not prepared h 1 I I fb m t e norma colirtse o usmess
Report-Item 2J U Organizational Chart middot See attabhed chart
Report- Item 2J k Banch Verification l Ii See attced chart
Report-Item 3 l middot middot Listing of sharehfders that directly or indirectly own control or hold with power to v9t 5 or more of any class of shares of the bank holding Company middotmiddotj
gt ll I
Name andAddrJJs J Timothy J Brovampn 1 Storm Lake IoWa I
i
John C Brown f 1 Spirit Lake IovM
1 f - (
Citizenship
1JSA
USA
Report Item 4 -se Schedule Attached
t
l H
il
Class A Common
Shares Owned
5009
3385
Percentage
5967
4033
Class B Common
Shares Owned
1296
44
Percentage
9460
321
ORGANIZATIONAL CHART
Report - Item 2(a) - Organization chart - Commercial Financial Corp Incorporated State of Iowa - Lakes Bancorporation Inc Incorporated State of Iowa - Central Bank Incorporated State of Iowa - Milford Holdings Inc Incorporated State of Iowa - Central Statutory Trust II Deleware Statutory Trust - Real Estate Owned LLC lncorprated State of Iowa - Central Florida Real Estate Owned LLC Incorporated State of Florida - Toss II LLC Incorporated State of Iowa
COMMERCIAL FINANCIAL CORP STORM LAKE IA
Non-Managing M Owns 40
ember
Toss II LLC Stonn Lake IA
Footnotes
Owns 65
CENTRAL BANK
STORM LAKE IA
Owns 100
MILFORD HOLDINGS INC STORM LAKE IA
(See footnote 1)
Lakes Bancorporation Inc
Stonn Lake IA
Owns 35
Managing Member Owns 100
REAL ESTATE OWNED LLC
STORM LAKE IA
1 Commercial Financial Corp owns 5540000 (100) of the outstanding shares of voting common stock
Owns 100
CENTRAL STATUTORY TRUST II
STORM LAKE IA
Managing Memb Owns 100
CENTRAL FLORIDA REAL ESTATE OWNED LLC
STORM LAKE IA
er
Results A list of branches for your holding company COMMERC1ALflNANCJALCORP (1978574) of STORM IAKE IA The data are as of 12312014 Data reflects lnfo1maton that was received and processd through Ol07 2015
Reconcl1alon md Vertncaloo SICli 1 Jn the Data Action column of each branch row enter one or more of the actions specified below 2 If required enter the date In the Effective Date column
Actions OK If the branch Information Is correct enterOK In the Data Action coumn
Change tr the branch Information Is Incorrect or Incomplete revise the data enterOrnnge In the Data Action colllmn and the date when this Information rlrstbecame vaJd In the Effective Dale column Close If a branch lsted was sold or closed enter Clos In the Data Actlori column and the sale or closure date In the Effective Date coumn Delete ]f a branch Med was never owned by this depository Institution enter Odele In the Data Action column Add Jf a reportable branch Is missing Insert a row add the branch data and enterAdd In the Data Action column and the opening or acqulsltfon date In theEHectlve Date column
If printing this Hsi you may need to adjust your pa Be setup In MS Excel Try uslng landscape orientation page scaling andor e(lal siled paper
Submission Procedure When you are finished send a saved copy to your FRB contact See the detailed Instructions on this site for more Information If you are e-malllng th ls to your FRB contact put your Institution name dty and state In the subject tine of the emiddotmall
Note To sltitislythe FR YmiddotlO reporting requirements you must aim submit FR YmiddotlO Domestic Branch Schedules for each branch with a Data Action of Q1ange dose Delete or Add The FR Y-10 report may be submitted In a hardcopy format or via the FR YmiddotlO Onlne applcatlon bull httpsylOonUnefederalreservegov
bull FOCUNINUM Office Number and D_RSSD columns are for reference only Verlflcatron of these values ls not required
Data Action Effective Date Branch Service Type Branch ID RSSDbull Popular Name Street Address City
OK Full Service Head Office) 545544 CENTRAL BANK 600 LAKE AVENUE STORM lAKE OK Full Service 4154B52 ANKENY BOULEVARD BRANCH 2805 NORTH ANKENY BOULEVARD ANKENY
OK Umlted Servke 2116588 CHEROKEE BRANCH 2BOW DRIVE CHEROKEE
OK Full Service 802848 CHEROKEE CENTRAL TRUST BRANCH 401 WEST MAIN STREET CHEROKEE
OK Full Service 2161147 4018 UNIVERSITY AVENUEOFFJCE 4018 UNIVERSITY AVENUE DES MOINES
OK Full Service 4155104 HUBBEL AVENUE BRANCH 2742 HUBBELLAVENUE DES MOINES
OK Full Service 4155270 WALNUT STREETS RANCH 700 WALNUT STREET DES MOINES
OK Full Service 4493169 4201 SOUTH LAKEPORT BRANCH 4201 SOUTH LAKEPORT SIOUX CITY
OK FuI Service 3078064 522 fOURTH STREET BRANCH 522 4TH STREET SIOUX CITY
OK Full Service 3596719 stoux OiY BRANCH 2-906 HAMILTON BLVD SIOUX CITY
OK Full Servke 810142 SPIRIT IAKE BRANCH 1400 1BTH STREET SPIRIT LAKE
OK limited Service 2045050 DRIVEmiddotIN BRANCH 1237 LAKE AVENUE STORM LAKE
OK Full Servke 4155252 URBANDALE BRANCH 3800 lOOTH STREET URBANDALE
OK Full Service 44931SO 6501 WESTOWN PARKWAY BRANCH 6601 WESTOWN PARKWAYSUITE140 WEST DES MOINES
OK Full Service 4639444 ASHWORTH ROAD BRANCH 6139 ASHWORTH ROAD WEST DES MOINES OK Full Service 4155131 MILLS ClVJCPARr-NAY BRANCH 5070 MILLS CIVIC PARKWAY WEST DES MOINES
State Zip Code County IA 505BS BUENA VISTA IA 50023 POLK IA 51012 CHEROKEE IA 51012 CHEROKEE IA 50311 POLK
IA 50317 POLK IA 50309 POLK IA 51106 WOODBURY
IA 51101 WOODBURY
IA 51104 WOODBURY IA Sl360 DICKINSON IA 505BBmiddot19 BUENA VISTA IA 50322 POLK IA S0266 POLK IA 50266 POLK IA 50265 POLK
Country FDICUNINUM+ Office Numberbull Head Offlce Head Office ID RSSDbull Comments UNITED STATES 9849 0 CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544 UNITED STATES 263121 6 CENTRAL BANK 546544 UNITED STATES 6467 3 CENTRAL BANK 545544 UNITED STATES Not Requred Not Required CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544
UNITED STATES Not Required Not Required CENTRAL BANK 546S44 UNITED STATES Not Required Nol Required CENTRAL BANK S46544 UNITED STATES 362876 7 CENTRAL BANK S45544 UNITED STATES 465474 9 CENTRAL BANK S46544
UNITED STATES 9695 8 CENTRAL BANK 546544
UNITED STATES 234537 l CENTRAL BANK 546S44 UNITED STATES Not Required Not Required CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544
UNITED STATES Not Required Not Requred CENTRAL BANK 546544
UNITED STATES Nol Required Not Required CENTRAL BANK 546544
Report Item 4 - Brincipal Shareholders Director Executive Officer ofBaMlHolding Company
1 (1) Name and adhress middoti
(2) Principal oc4Lation if other than with Miaing company
(3) Title or posltion with 1 I (a) Bank ho)g company
I j
(b) See Atta9ped I ( c) Other busfuess companies
l TossLLC Toss IT1f-LC
i Imiddot ( 4) Number of sliitres and percentage
of voting sedrities owned middot controlled oJ eldwith power to vote ii (a) Barik holtlmg company -1
Clas Common Class Common (Nobivoting)
i I (b) Subsidiaries of bank
h ld ti 0 mgmiddot1rmpany
i (c) Otherbusillfss companies
I
TossLic Meser units
Toss II ILLC Member units
I
Timothy J Brown Storm Lake Iowa
NIA
President and Director
Member Member
5009 Shares 5967
1296 Shares 9460
None
1667
1667
John C Brown Spirit Lake Iowa
NIA
Secretary Treasurer and Director
Member Member
3385 Shares 4033
44 Shares 321
None
1667
1667
r
Report Item 4 - Rrincipal Shareholders Director Executive Officer of BanhlEolding Company
middotI
(3) Title or p9itiori with middotI I
bull1 (b) Subsidiaes of
holding 1qompany
Central Bank I I
middot1 ti
Jvlilford Holtljitgs Inc I
i
I
I
middotl 1 i
i
Timothy J Brown Storm Lake Iowa
President and Director
President and Director
John C Brown Spirit Lake Iowa
Executive ViceshyPresident Secretary and Director
Executive ViceshyPtesident Secretary and Director
- FR Y-6 Cover Page
- For Use By Tiered Holding Companies
- Report Item 1 Annual Report to Shareholders
- Report Item 2a Organization Chart
- Report Item 2b Domestic Branch Listing
- Report Item 3 Securities Holders
- Report Item 4 Insiders
-
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ASSETS Cash
COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
BALANCE SHEETS December 31 2014 and 2013
ASSETS
$ Investments in subsidiaries -
2014
481555
Net equity in net assets of subsidiary 67517276 Excess of cost over net assets of subsidiaries 911572
Notes receivable - related parties 170136 Loans receivable - participation 2000000 Accrued interest receivable 9777 Income tax recoverable 339698 Deferred income taxes Other assets 749766
2013
$ 514943
60973592
167623
6 979 1734263
17000 746003
TOTAL ASSETS $ 72179780 $ 64160403
LIABILITIES AND STOCKHOLDERS EQUITY
LIABILITIES Accrued interest payable Due lo subsidiaries Subordinated debentures payable to nonbank subsidiary Deferred income taxes Dividend payable - Senior Preferred stock
Total liabilities
STOCKHOLDERS EQUITY Senior Non-Cumulative Perpetual Preferred stock
Series A $1000 par value 18000 shares authorized and issued variable dividend
Class A Preferred stock $100 par value 30000 shares authorized and issued 4 annum non-cumulative dividend preference
Class A Common stock no par value 10000000 shares authorized 8394 shares issued and outstanding
Class B Non-voting Common stock no par value 10000000 shares authorized 1370 shares issued and outstanding
Retained earnings Accumulated other comprehensive income
Total stockholders equity
TOTAL LIABILITIES AND STOCKHOLDERS EQUITY
2
$ 7316 325621
8248000 756
45000
8626693
18000000
3000000
1298505
398368 40744799
111415
63553087
$ 72179780
$ 6397 1630203 8248000
9884600
18000000
3000000
1298505
392 140 31412730
172428
54275803
$ 64 160403
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
STATEMENTS OF OPERATIONS Years Ended December 31 2014 and 2013
2014
INCOME Interest and dividend income $ 16996
OPERATING EXPENSES Salaries and benefits 12 935 Interest expense 166480 Professional fees 114475 Other expenses 51862
Total operating expenses 345752
Loss before equity in income of subsidiaries and income tax benefit (328756)
EQUITY IN INCOME OF SUBSIDIARIES 10001319
Income before income tax benefit 9672563
INCOME TAX BENEFIT 111261
NET INCOME $ 9783824
3
2013
$ 13 155
433423 168978
44845 3980
651226
(638071)
2824716
2 186645
207552
$ 2394 197
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
STATEMENTS OF COMPREHENSIVE INCOME Years Ended December 31 2014 and 2013
2014 2013
NET INCOME $ 9783824 $ 2394197
Other comprehensive loss Unrealized gains (losses) on subsidiary
available-for-sale securities Income tax benefit
Total other comprehensive Joss
Total comprehensive income
4
(98409) 37395
(61014)
(412795) 156863
(255932)
$ 9722810 $ 2 138265
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BALANCE DECEMBER 31 2012 Net income
Other comprehensive loss
Redemption of 53 shares of Class B common stock
Issuance of 30 shares of Class B common stock
Dividends declared and paid
BALANCE DECEMBER 31 2013 Net income
Other comprehensive loss
Redemption of 30 shares of Class B common stock
Issuance of 30 shares of Class B common stock
Dividends declared
BALANCE DECEMBER 31 2014
COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
STATEMENTS OF STOCKHOLDERS EQUITY Years Ended December 31 2014 and 2013
Retained Earnings
Accumulated Other
Comprehensive Income
Common Stock Class A Class B
$ 52543726 $ 29438533 $ 428360 $ 1298505 $ 378328 $
2394197
(255932) (81431) 95243
(420000)
54275803 9783824
(61013) (95243) 101471
(451755)
2394197
(420000)
31412730 9783824
(451755)
(255932)
172428 1298505
(61013)
(81431) 95243
392140
(95243) 101471
$ 63 5_53 087 $ 40 744 799 $1h1b1plusmn4gt15 $ 1 298 505 $ 398 368 $
5
Class A Preferred
Stock
Senior Preferred
Stock
3000000 $ 18000000
3000000 18000000
3 000 000 $ 18 000 000
bull bull COMMERCIAL FINANCIAL CORP
(PARENT COMPANY ONLY)
bull STATEMENTS OF CASH FLOWS Years Ended December 31 2014 and 2013
bull bull 2014 2013
bull CASH FLOWS FROM OPERATING ACTIVITIES Net income $ 9783824 $ 2394 197
bull Adjustments to reconcile net income to net cash used in operating activities
bull Equity in earnings of subsidiaries (10001319) (2824716) Losses on other assets 3618 3980
bull Effects of changes in operating assets and liabilities Due to and from subsidiaries (1304582) 1596002
bull Other (14949) Income tax receivable 1394565 (1368384) bull Notes receivable - related parties (2513) 4353
bull Deferred income taxes 17756 Accrued interest receivable (2798) 1391
bull Accrued interest payable 919 (209)
bull Net cash used in operating activities (125479) (193386)
bull CASH FLOWS FROM INVESTING ACTIVITIES Dividends received from subsidiaries 2500000 1250000
bull Loans receivable - participation (2000000) Investment in limited liability company (9382) (650724)
bull Other 2000 1500
bull Net cash provided by investing activities 492618 600776
bull CASH FLOWS FROM FINANCING ACTIVITIES Dividends paid to stockholders (406755) (465000)
bull Proceeds from issuance of Class B common stock 101471 95243
bull Payment to redeem Class B common stock (95243) (81431)
Net cash provided by financing activities (400527) (451 188)
bull NET DECREASE IN CASH (33388) (43798) bull
bull CASH BEGINNING OF YEAR 514943 558741
bull CASH END OF YEAR $ 481555 $ 514943
bull SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
bull Cash paid for interest was $165561 in 2014 and $169 187 in 2013 Cash received for income taxes was $219000 in 2014 and $435 170 in 2013
bull SUPPLEMENTAL DISCLOSURE OF NONCASH FINANCING ACTIVITIES Dividends declared on Senior Preferred stock of $45000 in 2014
bull is included in liabilities
bull bull
6
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Commercial Financial Corp (the Company) is an Iowa-based bank holding company At December 31 2014 the Company owns 100 of the voting common stock of Central Bank headquartered in Storm Lake Iowa During 2014 Lakes Bancorporation Inc was merged into Central Bank thereby increasing the Companys direct ownership in Central Bank to 100 Previously the Company owned 65 of Central Bank and 100 of Lakes Bancorporation which owned 35 of Central Bank Central Bank owns 100 of the common stock of Milford Holdings Inc and 100 of the membership interest in Real Estate Owned LLC and Central Florida Real Estate Owned LLC The Company also owns 100 of the common stock of Central Statutory Trust II (Central Statutory Trust)
The principal market areas for the Company and its subsidiaries are Storm Lake Cherokee Spirit Lake Sioux City Des Moines and the surrounding Iowa communities
The Companys subsidiaries make commercial agricultural real estate and installment loans to businesses and individuals as well as maintaining deposits for customers in their market areas
Use of Estimates in Preparing Financial Statements
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period Actual results could vary from those estimates
Investments in Subsidiaries
Accounting standards require the consolidation of majority-owned subsidiaries with the parent for financial reporting purposes Commercial Financial Corps wholly-owned subsidiaries Central Bank and Central Statutory Trust are included in the accompanying financial statements under the equity method rather than consolidated with the Company (See Note 6)
The accompanying financial statements are not intended to replace any consolidated financial statements of Commercial Financial Corp and subsidiaries
NOTE 2 - GROUP CONCENTRATION OF CREDIT RISK
The Companys primary business activity is with Central Bank in Storm Lake Cherokee Spirit Lake Des Moines and Sioux City Iowa The Bank makes commercial agricultural real estate and installment loans to customers in the Storm Lake Cherokee Spirit Lake Des Moines and Sioux City Iowa areas Although the Bank has a diversified loan portfolio a substantial portion of its debtors ability to honor their contracts is dependent upon the agricultural economy
7
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 3 - SUBORDINATED DEBENTURES PAYABLE TO NONBANK SUBSIDIARY
Subordinated debentures payable to nonbank subsidiary at December 31 2014 and 2013 represents indebtedness to Central Statutory Trust II and bears interest at a rate equal to the 3-month LIBOR rate plus 175 At December 31 2014 and 2013 the interest rate was 199 and 199 respectively The principal amounts of the debentures are due June 21 2037
NOTE 4 - INCOME TAXES
The Company and its subsidiaries file consolidated federal and State of Iowa income tax return The subsidiaries provide for income taxes on a separate return basis and remit to the Company amounts determined to be currently payable
The Company follows the accounting requirements for uncertain tax positions The Company determined that no liability related to uncertain tax positions was required as of December 31 2014 and 2013
The federal and state income tax returns of the Company for 2011 and thereafter are subject to examination by the IRS and state taxing authorities generally for three years after they were filed
NOTE 5 - RESTRICTIONS ON SUBSIDIARY DIVIDENDS
The ability of the Company to service its debt is dependent on cash dividends paid to the Company by its subsidiary bank The Bank is a state chartered bank that is also a member of a federal reserve bank The subsidiary bank is subject to certain statutory and regulatory restrictions on the amount it may pay in dividends
A state bank that is registered as a federal reserve bank may not pay a dividend which would impair the capital of the bank A federal reserve member bank is required to obtain prior approval of the Board of Governors of the Federal Reserve System if the total of all dividends including the proposed dividends declared by the bank in any calendar year exceeds the total of the banks net profits of that year combined with its retained net profits of the preceding two years In addition a bank chartered under Iowa law may pay dividends up to the amount of its undivided profits provided its surplus account equals or exceeds its capital account subject to maintenance of minimum capital requirements
8
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 6 - SUBSIDIARY CONDENSED FINANCIAL STATEMENTS
The following is a summary of selected unaudited financial information of Central Bank based upon the December 31 2014 and 2013 financial statements submitted to the Federal Deposit Insurance Corporation
2014 2013
Total assets $ 655686000 $ 651573000
Liabilities $ 588121000 $ 591764000 Stockholders equity 67565000 59809000
Total liabilities and stockholders equity $ 655686000 $ 651573000
Net income $ 10001000 $ 2825000
During 2014 Lakes Bancorporation Inc was merged into Central Bank In connection with the merger the Company recognized $911572 in excess of cost over net assets of subsidiaries (goodwill) which had been previously recognized by Lakes Bancorporation Inc The following is a summary of selected unaudited parent company only financial information of Lakes Bancorporation based on December 31 2013 parent company only financial statements filed with the Federal Reserve System
2013
Total assets $ 21 916000
Liabilities $ Stockholders equity 21 916000
Total liabilities and stockholders equity $ 21 916000
Net income $ 989000
Central Bank owns 100 of the common stock of Milford Holdings Inc The following is a summary of selected unaudited financial information of Milford Holdings Inc
2014 2013
Total assets $ 7660000 $ 7022000
Liabilities $ 31000 $ Stockholders equity 7629000 7022000
Total liabilities and stockholders equity $ 7660000 $ 7022000
Net income $ 607000 $ 370000
9
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 6 - SUBSIDIARY CONDENSED FINANCIAL STATEMENTS (CONTINUED)
During 2013 Central Bank acquired 100 of the membership interest in Real Estate Owned LLC The following is a summary of selected unaudited financial information of Real Estate Owned LLC
2014 2013
Total assets $ 4508000 $ 3456000
Liabilities $ 17000 $ Stockholders equity 4491000 3456000
Total liabilities and stockholders equity $ 4508000 $ 3456000
Net income $ 206000 $
During 2013 Central Bank acquired 100 of the membership interest in Central Florida Real Estate Owned LLC The following is a summary of selected unaudited financial information of Central Florida Real Estate Owned LLC
Total assets
Liabilities Stockholders equity
Total liabilities and stockholders equity
Net income
$
$
$
$
2014 2013
744000 $ 1476000
$ 744000 1476000
744000 $ 1476000
140000 $
The Company owns 100 of the trust common securities of Central Statutory Trust II Central Statutory Trust II was formed to issue Company obligated mandatorily redeemable preferred securities (Preferred Securities) Central Statutory Trust II has issued all of the 8000000 authorized shares of preferred securities The preferred securities are considered liabilities on the balance sheet for Central Statutory Trust II For regulatory purposes a portion of the preferred securities are allowed in the calculation of Tier 1 and Tier 2 capital of the Company
10
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 6 - SUBSIDIARY CONDENSED FINANCIAL STATEMENTS (CONTINUED)
The following is a summary of selected unaudited financial information of Central Statutory Trust II based on December 31 2014 and 2013 quarterly financial statements of nonbank subsidiaries filed with the Federal Reserve System
2014 2013
Total assets $ 8248000 $ 8248000
Liabilities $ 8000000 $ 8000000 Stockholders equity 248000 248000
Total liabilities and stockholders equity $ 8248000 $ 8248000
Net income $ $
NOTE 7 - SENIOR PREFERRED STOCK
The Company executed a Small Business Lending Fund Securities Purchase Agreement with the United States Department of the Treasury (Treasury) effective September 20 2011 Through the Small Business Lending Fund (SBLF) the Treasury provides Tier 1 capital to community banks and other eligible institutions Each institution pays dividend rates that go down as its small business lending goes up
Treasury was issued 18000 shares of Senior Non-Cumulative Perpetual Preferred Stock Series A for $18000000 on September 20 2011 The initial dividend rate was 5 The variable dividend rate may decrease each of the following nine quarters based on the increase in qualified small business lending as defined in the agreement The dividend rate will vary between 1 and 5 as lending increases vary between 10 and 25 The fixed dividend rate for the tenth quarter after funding through the end of the first four and one-half years is set as described above if lending has increased at the end of the eighth quarter after funding If lending has not increased at the end of the eighth quarter after funding the fixed dividend rate is set at 7 The fixed dividend rate after four and one-half years is set at 9 if the funding has not already been repaid The dividend rate at December 31 2014 and 2013 was 1 for both years
The Treasury has a liquidation preference of $1000 per share or $18000000 as of December 31 2014 Dividends are payable quarterly in arrears on January 1 April 1 July 1 and October 1 of each year Dividends payable at December 31 2014 and 2013 are $45000 and $0 respectively The Company may repay the funding at any time with regulatory approval
11
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 8 - ACCUMULATED OTHER COMPREHENSIVE INCOME
Central Bank and Milford Holdings Inc maintain certain securities in an available-for-sale category At December 31 2014 and 2013 combined accumulated other comprehensive income related to available-for-sale securities in the amount of $111415 and $172428 respectively was recorded directly to the Companys stockholders equity for its 100 proportionate share of the other comprehensive income
NOTE 9 - SUBSEQUENT EVENTS
Management evaluated subsequent events through March 6 2015 the date the financial statements were available to be issued Events or transactions occurring after December 31 2014 but prior to March 6 2015 that provided additional evidence about conditions that existed at December 31 2014 have been recognized in the financial statements for the year ended December 31 2014 Events or transactions that provided evidence about conditions that did not exist at December 31 2014 but arose before the financial statements were available to be issued have not been recognized in the financial statements for the year ended December 31 2014
See accountants compilation report
12
COMMERCIAL FINANCIAL CORP
Report - rem J Commercial Fuianc1al Corp is not required to file with the Secunt1es and
Exchange Comfriiksion r bull 1 R
eport
Item 111 Fmancial statenints parent company only of Commercial Fmancial Corp middotI
are attached Cppsolidated financial statements are not prepared h 1 I I fb m t e norma colirtse o usmess
Report-Item 2J U Organizational Chart middot See attabhed chart
Report- Item 2J k Banch Verification l Ii See attced chart
Report-Item 3 l middot middot Listing of sharehfders that directly or indirectly own control or hold with power to v9t 5 or more of any class of shares of the bank holding Company middotmiddotj
gt ll I
Name andAddrJJs J Timothy J Brovampn 1 Storm Lake IoWa I
i
John C Brown f 1 Spirit Lake IovM
1 f - (
Citizenship
1JSA
USA
Report Item 4 -se Schedule Attached
t
l H
il
Class A Common
Shares Owned
5009
3385
Percentage
5967
4033
Class B Common
Shares Owned
1296
44
Percentage
9460
321
ORGANIZATIONAL CHART
Report - Item 2(a) - Organization chart - Commercial Financial Corp Incorporated State of Iowa - Lakes Bancorporation Inc Incorporated State of Iowa - Central Bank Incorporated State of Iowa - Milford Holdings Inc Incorporated State of Iowa - Central Statutory Trust II Deleware Statutory Trust - Real Estate Owned LLC lncorprated State of Iowa - Central Florida Real Estate Owned LLC Incorporated State of Florida - Toss II LLC Incorporated State of Iowa
COMMERCIAL FINANCIAL CORP STORM LAKE IA
Non-Managing M Owns 40
ember
Toss II LLC Stonn Lake IA
Footnotes
Owns 65
CENTRAL BANK
STORM LAKE IA
Owns 100
MILFORD HOLDINGS INC STORM LAKE IA
(See footnote 1)
Lakes Bancorporation Inc
Stonn Lake IA
Owns 35
Managing Member Owns 100
REAL ESTATE OWNED LLC
STORM LAKE IA
1 Commercial Financial Corp owns 5540000 (100) of the outstanding shares of voting common stock
Owns 100
CENTRAL STATUTORY TRUST II
STORM LAKE IA
Managing Memb Owns 100
CENTRAL FLORIDA REAL ESTATE OWNED LLC
STORM LAKE IA
er
Results A list of branches for your holding company COMMERC1ALflNANCJALCORP (1978574) of STORM IAKE IA The data are as of 12312014 Data reflects lnfo1maton that was received and processd through Ol07 2015
Reconcl1alon md Vertncaloo SICli 1 Jn the Data Action column of each branch row enter one or more of the actions specified below 2 If required enter the date In the Effective Date column
Actions OK If the branch Information Is correct enterOK In the Data Action coumn
Change tr the branch Information Is Incorrect or Incomplete revise the data enterOrnnge In the Data Action colllmn and the date when this Information rlrstbecame vaJd In the Effective Dale column Close If a branch lsted was sold or closed enter Clos In the Data Actlori column and the sale or closure date In the Effective Date coumn Delete ]f a branch Med was never owned by this depository Institution enter Odele In the Data Action column Add Jf a reportable branch Is missing Insert a row add the branch data and enterAdd In the Data Action column and the opening or acqulsltfon date In theEHectlve Date column
If printing this Hsi you may need to adjust your pa Be setup In MS Excel Try uslng landscape orientation page scaling andor e(lal siled paper
Submission Procedure When you are finished send a saved copy to your FRB contact See the detailed Instructions on this site for more Information If you are e-malllng th ls to your FRB contact put your Institution name dty and state In the subject tine of the emiddotmall
Note To sltitislythe FR YmiddotlO reporting requirements you must aim submit FR YmiddotlO Domestic Branch Schedules for each branch with a Data Action of Q1ange dose Delete or Add The FR Y-10 report may be submitted In a hardcopy format or via the FR YmiddotlO Onlne applcatlon bull httpsylOonUnefederalreservegov
bull FOCUNINUM Office Number and D_RSSD columns are for reference only Verlflcatron of these values ls not required
Data Action Effective Date Branch Service Type Branch ID RSSDbull Popular Name Street Address City
OK Full Service Head Office) 545544 CENTRAL BANK 600 LAKE AVENUE STORM lAKE OK Full Service 4154B52 ANKENY BOULEVARD BRANCH 2805 NORTH ANKENY BOULEVARD ANKENY
OK Umlted Servke 2116588 CHEROKEE BRANCH 2BOW DRIVE CHEROKEE
OK Full Service 802848 CHEROKEE CENTRAL TRUST BRANCH 401 WEST MAIN STREET CHEROKEE
OK Full Service 2161147 4018 UNIVERSITY AVENUEOFFJCE 4018 UNIVERSITY AVENUE DES MOINES
OK Full Service 4155104 HUBBEL AVENUE BRANCH 2742 HUBBELLAVENUE DES MOINES
OK Full Service 4155270 WALNUT STREETS RANCH 700 WALNUT STREET DES MOINES
OK Full Service 4493169 4201 SOUTH LAKEPORT BRANCH 4201 SOUTH LAKEPORT SIOUX CITY
OK FuI Service 3078064 522 fOURTH STREET BRANCH 522 4TH STREET SIOUX CITY
OK Full Service 3596719 stoux OiY BRANCH 2-906 HAMILTON BLVD SIOUX CITY
OK Full Servke 810142 SPIRIT IAKE BRANCH 1400 1BTH STREET SPIRIT LAKE
OK limited Service 2045050 DRIVEmiddotIN BRANCH 1237 LAKE AVENUE STORM LAKE
OK Full Servke 4155252 URBANDALE BRANCH 3800 lOOTH STREET URBANDALE
OK Full Service 44931SO 6501 WESTOWN PARKWAY BRANCH 6601 WESTOWN PARKWAYSUITE140 WEST DES MOINES
OK Full Service 4639444 ASHWORTH ROAD BRANCH 6139 ASHWORTH ROAD WEST DES MOINES OK Full Service 4155131 MILLS ClVJCPARr-NAY BRANCH 5070 MILLS CIVIC PARKWAY WEST DES MOINES
State Zip Code County IA 505BS BUENA VISTA IA 50023 POLK IA 51012 CHEROKEE IA 51012 CHEROKEE IA 50311 POLK
IA 50317 POLK IA 50309 POLK IA 51106 WOODBURY
IA 51101 WOODBURY
IA 51104 WOODBURY IA Sl360 DICKINSON IA 505BBmiddot19 BUENA VISTA IA 50322 POLK IA S0266 POLK IA 50266 POLK IA 50265 POLK
Country FDICUNINUM+ Office Numberbull Head Offlce Head Office ID RSSDbull Comments UNITED STATES 9849 0 CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544 UNITED STATES 263121 6 CENTRAL BANK 546544 UNITED STATES 6467 3 CENTRAL BANK 545544 UNITED STATES Not Requred Not Required CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544
UNITED STATES Not Required Not Required CENTRAL BANK 546S44 UNITED STATES Not Required Nol Required CENTRAL BANK S46544 UNITED STATES 362876 7 CENTRAL BANK S45544 UNITED STATES 465474 9 CENTRAL BANK S46544
UNITED STATES 9695 8 CENTRAL BANK 546544
UNITED STATES 234537 l CENTRAL BANK 546S44 UNITED STATES Not Required Not Required CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544
UNITED STATES Not Required Not Requred CENTRAL BANK 546544
UNITED STATES Nol Required Not Required CENTRAL BANK 546544
Report Item 4 - Brincipal Shareholders Director Executive Officer ofBaMlHolding Company
1 (1) Name and adhress middoti
(2) Principal oc4Lation if other than with Miaing company
(3) Title or posltion with 1 I (a) Bank ho)g company
I j
(b) See Atta9ped I ( c) Other busfuess companies
l TossLLC Toss IT1f-LC
i Imiddot ( 4) Number of sliitres and percentage
of voting sedrities owned middot controlled oJ eldwith power to vote ii (a) Barik holtlmg company -1
Clas Common Class Common (Nobivoting)
i I (b) Subsidiaries of bank
h ld ti 0 mgmiddot1rmpany
i (c) Otherbusillfss companies
I
TossLic Meser units
Toss II ILLC Member units
I
Timothy J Brown Storm Lake Iowa
NIA
President and Director
Member Member
5009 Shares 5967
1296 Shares 9460
None
1667
1667
John C Brown Spirit Lake Iowa
NIA
Secretary Treasurer and Director
Member Member
3385 Shares 4033
44 Shares 321
None
1667
1667
r
Report Item 4 - Rrincipal Shareholders Director Executive Officer of BanhlEolding Company
middotI
(3) Title or p9itiori with middotI I
bull1 (b) Subsidiaes of
holding 1qompany
Central Bank I I
middot1 ti
Jvlilford Holtljitgs Inc I
i
I
I
middotl 1 i
i
Timothy J Brown Storm Lake Iowa
President and Director
President and Director
John C Brown Spirit Lake Iowa
Executive ViceshyPresident Secretary and Director
Executive ViceshyPtesident Secretary and Director
- FR Y-6 Cover Page
- For Use By Tiered Holding Companies
- Report Item 1 Annual Report to Shareholders
- Report Item 2a Organization Chart
- Report Item 2b Domestic Branch Listing
- Report Item 3 Securities Holders
- Report Item 4 Insiders
-
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
STATEMENTS OF OPERATIONS Years Ended December 31 2014 and 2013
2014
INCOME Interest and dividend income $ 16996
OPERATING EXPENSES Salaries and benefits 12 935 Interest expense 166480 Professional fees 114475 Other expenses 51862
Total operating expenses 345752
Loss before equity in income of subsidiaries and income tax benefit (328756)
EQUITY IN INCOME OF SUBSIDIARIES 10001319
Income before income tax benefit 9672563
INCOME TAX BENEFIT 111261
NET INCOME $ 9783824
3
2013
$ 13 155
433423 168978
44845 3980
651226
(638071)
2824716
2 186645
207552
$ 2394 197
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
STATEMENTS OF COMPREHENSIVE INCOME Years Ended December 31 2014 and 2013
2014 2013
NET INCOME $ 9783824 $ 2394197
Other comprehensive loss Unrealized gains (losses) on subsidiary
available-for-sale securities Income tax benefit
Total other comprehensive Joss
Total comprehensive income
4
(98409) 37395
(61014)
(412795) 156863
(255932)
$ 9722810 $ 2 138265
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BALANCE DECEMBER 31 2012 Net income
Other comprehensive loss
Redemption of 53 shares of Class B common stock
Issuance of 30 shares of Class B common stock
Dividends declared and paid
BALANCE DECEMBER 31 2013 Net income
Other comprehensive loss
Redemption of 30 shares of Class B common stock
Issuance of 30 shares of Class B common stock
Dividends declared
BALANCE DECEMBER 31 2014
COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
STATEMENTS OF STOCKHOLDERS EQUITY Years Ended December 31 2014 and 2013
Retained Earnings
Accumulated Other
Comprehensive Income
Common Stock Class A Class B
$ 52543726 $ 29438533 $ 428360 $ 1298505 $ 378328 $
2394197
(255932) (81431) 95243
(420000)
54275803 9783824
(61013) (95243) 101471
(451755)
2394197
(420000)
31412730 9783824
(451755)
(255932)
172428 1298505
(61013)
(81431) 95243
392140
(95243) 101471
$ 63 5_53 087 $ 40 744 799 $1h1b1plusmn4gt15 $ 1 298 505 $ 398 368 $
5
Class A Preferred
Stock
Senior Preferred
Stock
3000000 $ 18000000
3000000 18000000
3 000 000 $ 18 000 000
bull bull COMMERCIAL FINANCIAL CORP
(PARENT COMPANY ONLY)
bull STATEMENTS OF CASH FLOWS Years Ended December 31 2014 and 2013
bull bull 2014 2013
bull CASH FLOWS FROM OPERATING ACTIVITIES Net income $ 9783824 $ 2394 197
bull Adjustments to reconcile net income to net cash used in operating activities
bull Equity in earnings of subsidiaries (10001319) (2824716) Losses on other assets 3618 3980
bull Effects of changes in operating assets and liabilities Due to and from subsidiaries (1304582) 1596002
bull Other (14949) Income tax receivable 1394565 (1368384) bull Notes receivable - related parties (2513) 4353
bull Deferred income taxes 17756 Accrued interest receivable (2798) 1391
bull Accrued interest payable 919 (209)
bull Net cash used in operating activities (125479) (193386)
bull CASH FLOWS FROM INVESTING ACTIVITIES Dividends received from subsidiaries 2500000 1250000
bull Loans receivable - participation (2000000) Investment in limited liability company (9382) (650724)
bull Other 2000 1500
bull Net cash provided by investing activities 492618 600776
bull CASH FLOWS FROM FINANCING ACTIVITIES Dividends paid to stockholders (406755) (465000)
bull Proceeds from issuance of Class B common stock 101471 95243
bull Payment to redeem Class B common stock (95243) (81431)
Net cash provided by financing activities (400527) (451 188)
bull NET DECREASE IN CASH (33388) (43798) bull
bull CASH BEGINNING OF YEAR 514943 558741
bull CASH END OF YEAR $ 481555 $ 514943
bull SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
bull Cash paid for interest was $165561 in 2014 and $169 187 in 2013 Cash received for income taxes was $219000 in 2014 and $435 170 in 2013
bull SUPPLEMENTAL DISCLOSURE OF NONCASH FINANCING ACTIVITIES Dividends declared on Senior Preferred stock of $45000 in 2014
bull is included in liabilities
bull bull
6
bull
bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull
COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Commercial Financial Corp (the Company) is an Iowa-based bank holding company At December 31 2014 the Company owns 100 of the voting common stock of Central Bank headquartered in Storm Lake Iowa During 2014 Lakes Bancorporation Inc was merged into Central Bank thereby increasing the Companys direct ownership in Central Bank to 100 Previously the Company owned 65 of Central Bank and 100 of Lakes Bancorporation which owned 35 of Central Bank Central Bank owns 100 of the common stock of Milford Holdings Inc and 100 of the membership interest in Real Estate Owned LLC and Central Florida Real Estate Owned LLC The Company also owns 100 of the common stock of Central Statutory Trust II (Central Statutory Trust)
The principal market areas for the Company and its subsidiaries are Storm Lake Cherokee Spirit Lake Sioux City Des Moines and the surrounding Iowa communities
The Companys subsidiaries make commercial agricultural real estate and installment loans to businesses and individuals as well as maintaining deposits for customers in their market areas
Use of Estimates in Preparing Financial Statements
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period Actual results could vary from those estimates
Investments in Subsidiaries
Accounting standards require the consolidation of majority-owned subsidiaries with the parent for financial reporting purposes Commercial Financial Corps wholly-owned subsidiaries Central Bank and Central Statutory Trust are included in the accompanying financial statements under the equity method rather than consolidated with the Company (See Note 6)
The accompanying financial statements are not intended to replace any consolidated financial statements of Commercial Financial Corp and subsidiaries
NOTE 2 - GROUP CONCENTRATION OF CREDIT RISK
The Companys primary business activity is with Central Bank in Storm Lake Cherokee Spirit Lake Des Moines and Sioux City Iowa The Bank makes commercial agricultural real estate and installment loans to customers in the Storm Lake Cherokee Spirit Lake Des Moines and Sioux City Iowa areas Although the Bank has a diversified loan portfolio a substantial portion of its debtors ability to honor their contracts is dependent upon the agricultural economy
7
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 3 - SUBORDINATED DEBENTURES PAYABLE TO NONBANK SUBSIDIARY
Subordinated debentures payable to nonbank subsidiary at December 31 2014 and 2013 represents indebtedness to Central Statutory Trust II and bears interest at a rate equal to the 3-month LIBOR rate plus 175 At December 31 2014 and 2013 the interest rate was 199 and 199 respectively The principal amounts of the debentures are due June 21 2037
NOTE 4 - INCOME TAXES
The Company and its subsidiaries file consolidated federal and State of Iowa income tax return The subsidiaries provide for income taxes on a separate return basis and remit to the Company amounts determined to be currently payable
The Company follows the accounting requirements for uncertain tax positions The Company determined that no liability related to uncertain tax positions was required as of December 31 2014 and 2013
The federal and state income tax returns of the Company for 2011 and thereafter are subject to examination by the IRS and state taxing authorities generally for three years after they were filed
NOTE 5 - RESTRICTIONS ON SUBSIDIARY DIVIDENDS
The ability of the Company to service its debt is dependent on cash dividends paid to the Company by its subsidiary bank The Bank is a state chartered bank that is also a member of a federal reserve bank The subsidiary bank is subject to certain statutory and regulatory restrictions on the amount it may pay in dividends
A state bank that is registered as a federal reserve bank may not pay a dividend which would impair the capital of the bank A federal reserve member bank is required to obtain prior approval of the Board of Governors of the Federal Reserve System if the total of all dividends including the proposed dividends declared by the bank in any calendar year exceeds the total of the banks net profits of that year combined with its retained net profits of the preceding two years In addition a bank chartered under Iowa law may pay dividends up to the amount of its undivided profits provided its surplus account equals or exceeds its capital account subject to maintenance of minimum capital requirements
8
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 6 - SUBSIDIARY CONDENSED FINANCIAL STATEMENTS
The following is a summary of selected unaudited financial information of Central Bank based upon the December 31 2014 and 2013 financial statements submitted to the Federal Deposit Insurance Corporation
2014 2013
Total assets $ 655686000 $ 651573000
Liabilities $ 588121000 $ 591764000 Stockholders equity 67565000 59809000
Total liabilities and stockholders equity $ 655686000 $ 651573000
Net income $ 10001000 $ 2825000
During 2014 Lakes Bancorporation Inc was merged into Central Bank In connection with the merger the Company recognized $911572 in excess of cost over net assets of subsidiaries (goodwill) which had been previously recognized by Lakes Bancorporation Inc The following is a summary of selected unaudited parent company only financial information of Lakes Bancorporation based on December 31 2013 parent company only financial statements filed with the Federal Reserve System
2013
Total assets $ 21 916000
Liabilities $ Stockholders equity 21 916000
Total liabilities and stockholders equity $ 21 916000
Net income $ 989000
Central Bank owns 100 of the common stock of Milford Holdings Inc The following is a summary of selected unaudited financial information of Milford Holdings Inc
2014 2013
Total assets $ 7660000 $ 7022000
Liabilities $ 31000 $ Stockholders equity 7629000 7022000
Total liabilities and stockholders equity $ 7660000 $ 7022000
Net income $ 607000 $ 370000
9
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 6 - SUBSIDIARY CONDENSED FINANCIAL STATEMENTS (CONTINUED)
During 2013 Central Bank acquired 100 of the membership interest in Real Estate Owned LLC The following is a summary of selected unaudited financial information of Real Estate Owned LLC
2014 2013
Total assets $ 4508000 $ 3456000
Liabilities $ 17000 $ Stockholders equity 4491000 3456000
Total liabilities and stockholders equity $ 4508000 $ 3456000
Net income $ 206000 $
During 2013 Central Bank acquired 100 of the membership interest in Central Florida Real Estate Owned LLC The following is a summary of selected unaudited financial information of Central Florida Real Estate Owned LLC
Total assets
Liabilities Stockholders equity
Total liabilities and stockholders equity
Net income
$
$
$
$
2014 2013
744000 $ 1476000
$ 744000 1476000
744000 $ 1476000
140000 $
The Company owns 100 of the trust common securities of Central Statutory Trust II Central Statutory Trust II was formed to issue Company obligated mandatorily redeemable preferred securities (Preferred Securities) Central Statutory Trust II has issued all of the 8000000 authorized shares of preferred securities The preferred securities are considered liabilities on the balance sheet for Central Statutory Trust II For regulatory purposes a portion of the preferred securities are allowed in the calculation of Tier 1 and Tier 2 capital of the Company
10
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 6 - SUBSIDIARY CONDENSED FINANCIAL STATEMENTS (CONTINUED)
The following is a summary of selected unaudited financial information of Central Statutory Trust II based on December 31 2014 and 2013 quarterly financial statements of nonbank subsidiaries filed with the Federal Reserve System
2014 2013
Total assets $ 8248000 $ 8248000
Liabilities $ 8000000 $ 8000000 Stockholders equity 248000 248000
Total liabilities and stockholders equity $ 8248000 $ 8248000
Net income $ $
NOTE 7 - SENIOR PREFERRED STOCK
The Company executed a Small Business Lending Fund Securities Purchase Agreement with the United States Department of the Treasury (Treasury) effective September 20 2011 Through the Small Business Lending Fund (SBLF) the Treasury provides Tier 1 capital to community banks and other eligible institutions Each institution pays dividend rates that go down as its small business lending goes up
Treasury was issued 18000 shares of Senior Non-Cumulative Perpetual Preferred Stock Series A for $18000000 on September 20 2011 The initial dividend rate was 5 The variable dividend rate may decrease each of the following nine quarters based on the increase in qualified small business lending as defined in the agreement The dividend rate will vary between 1 and 5 as lending increases vary between 10 and 25 The fixed dividend rate for the tenth quarter after funding through the end of the first four and one-half years is set as described above if lending has increased at the end of the eighth quarter after funding If lending has not increased at the end of the eighth quarter after funding the fixed dividend rate is set at 7 The fixed dividend rate after four and one-half years is set at 9 if the funding has not already been repaid The dividend rate at December 31 2014 and 2013 was 1 for both years
The Treasury has a liquidation preference of $1000 per share or $18000000 as of December 31 2014 Dividends are payable quarterly in arrears on January 1 April 1 July 1 and October 1 of each year Dividends payable at December 31 2014 and 2013 are $45000 and $0 respectively The Company may repay the funding at any time with regulatory approval
11
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 8 - ACCUMULATED OTHER COMPREHENSIVE INCOME
Central Bank and Milford Holdings Inc maintain certain securities in an available-for-sale category At December 31 2014 and 2013 combined accumulated other comprehensive income related to available-for-sale securities in the amount of $111415 and $172428 respectively was recorded directly to the Companys stockholders equity for its 100 proportionate share of the other comprehensive income
NOTE 9 - SUBSEQUENT EVENTS
Management evaluated subsequent events through March 6 2015 the date the financial statements were available to be issued Events or transactions occurring after December 31 2014 but prior to March 6 2015 that provided additional evidence about conditions that existed at December 31 2014 have been recognized in the financial statements for the year ended December 31 2014 Events or transactions that provided evidence about conditions that did not exist at December 31 2014 but arose before the financial statements were available to be issued have not been recognized in the financial statements for the year ended December 31 2014
See accountants compilation report
12
COMMERCIAL FINANCIAL CORP
Report - rem J Commercial Fuianc1al Corp is not required to file with the Secunt1es and
Exchange Comfriiksion r bull 1 R
eport
Item 111 Fmancial statenints parent company only of Commercial Fmancial Corp middotI
are attached Cppsolidated financial statements are not prepared h 1 I I fb m t e norma colirtse o usmess
Report-Item 2J U Organizational Chart middot See attabhed chart
Report- Item 2J k Banch Verification l Ii See attced chart
Report-Item 3 l middot middot Listing of sharehfders that directly or indirectly own control or hold with power to v9t 5 or more of any class of shares of the bank holding Company middotmiddotj
gt ll I
Name andAddrJJs J Timothy J Brovampn 1 Storm Lake IoWa I
i
John C Brown f 1 Spirit Lake IovM
1 f - (
Citizenship
1JSA
USA
Report Item 4 -se Schedule Attached
t
l H
il
Class A Common
Shares Owned
5009
3385
Percentage
5967
4033
Class B Common
Shares Owned
1296
44
Percentage
9460
321
ORGANIZATIONAL CHART
Report - Item 2(a) - Organization chart - Commercial Financial Corp Incorporated State of Iowa - Lakes Bancorporation Inc Incorporated State of Iowa - Central Bank Incorporated State of Iowa - Milford Holdings Inc Incorporated State of Iowa - Central Statutory Trust II Deleware Statutory Trust - Real Estate Owned LLC lncorprated State of Iowa - Central Florida Real Estate Owned LLC Incorporated State of Florida - Toss II LLC Incorporated State of Iowa
COMMERCIAL FINANCIAL CORP STORM LAKE IA
Non-Managing M Owns 40
ember
Toss II LLC Stonn Lake IA
Footnotes
Owns 65
CENTRAL BANK
STORM LAKE IA
Owns 100
MILFORD HOLDINGS INC STORM LAKE IA
(See footnote 1)
Lakes Bancorporation Inc
Stonn Lake IA
Owns 35
Managing Member Owns 100
REAL ESTATE OWNED LLC
STORM LAKE IA
1 Commercial Financial Corp owns 5540000 (100) of the outstanding shares of voting common stock
Owns 100
CENTRAL STATUTORY TRUST II
STORM LAKE IA
Managing Memb Owns 100
CENTRAL FLORIDA REAL ESTATE OWNED LLC
STORM LAKE IA
er
Results A list of branches for your holding company COMMERC1ALflNANCJALCORP (1978574) of STORM IAKE IA The data are as of 12312014 Data reflects lnfo1maton that was received and processd through Ol07 2015
Reconcl1alon md Vertncaloo SICli 1 Jn the Data Action column of each branch row enter one or more of the actions specified below 2 If required enter the date In the Effective Date column
Actions OK If the branch Information Is correct enterOK In the Data Action coumn
Change tr the branch Information Is Incorrect or Incomplete revise the data enterOrnnge In the Data Action colllmn and the date when this Information rlrstbecame vaJd In the Effective Dale column Close If a branch lsted was sold or closed enter Clos In the Data Actlori column and the sale or closure date In the Effective Date coumn Delete ]f a branch Med was never owned by this depository Institution enter Odele In the Data Action column Add Jf a reportable branch Is missing Insert a row add the branch data and enterAdd In the Data Action column and the opening or acqulsltfon date In theEHectlve Date column
If printing this Hsi you may need to adjust your pa Be setup In MS Excel Try uslng landscape orientation page scaling andor e(lal siled paper
Submission Procedure When you are finished send a saved copy to your FRB contact See the detailed Instructions on this site for more Information If you are e-malllng th ls to your FRB contact put your Institution name dty and state In the subject tine of the emiddotmall
Note To sltitislythe FR YmiddotlO reporting requirements you must aim submit FR YmiddotlO Domestic Branch Schedules for each branch with a Data Action of Q1ange dose Delete or Add The FR Y-10 report may be submitted In a hardcopy format or via the FR YmiddotlO Onlne applcatlon bull httpsylOonUnefederalreservegov
bull FOCUNINUM Office Number and D_RSSD columns are for reference only Verlflcatron of these values ls not required
Data Action Effective Date Branch Service Type Branch ID RSSDbull Popular Name Street Address City
OK Full Service Head Office) 545544 CENTRAL BANK 600 LAKE AVENUE STORM lAKE OK Full Service 4154B52 ANKENY BOULEVARD BRANCH 2805 NORTH ANKENY BOULEVARD ANKENY
OK Umlted Servke 2116588 CHEROKEE BRANCH 2BOW DRIVE CHEROKEE
OK Full Service 802848 CHEROKEE CENTRAL TRUST BRANCH 401 WEST MAIN STREET CHEROKEE
OK Full Service 2161147 4018 UNIVERSITY AVENUEOFFJCE 4018 UNIVERSITY AVENUE DES MOINES
OK Full Service 4155104 HUBBEL AVENUE BRANCH 2742 HUBBELLAVENUE DES MOINES
OK Full Service 4155270 WALNUT STREETS RANCH 700 WALNUT STREET DES MOINES
OK Full Service 4493169 4201 SOUTH LAKEPORT BRANCH 4201 SOUTH LAKEPORT SIOUX CITY
OK FuI Service 3078064 522 fOURTH STREET BRANCH 522 4TH STREET SIOUX CITY
OK Full Service 3596719 stoux OiY BRANCH 2-906 HAMILTON BLVD SIOUX CITY
OK Full Servke 810142 SPIRIT IAKE BRANCH 1400 1BTH STREET SPIRIT LAKE
OK limited Service 2045050 DRIVEmiddotIN BRANCH 1237 LAKE AVENUE STORM LAKE
OK Full Servke 4155252 URBANDALE BRANCH 3800 lOOTH STREET URBANDALE
OK Full Service 44931SO 6501 WESTOWN PARKWAY BRANCH 6601 WESTOWN PARKWAYSUITE140 WEST DES MOINES
OK Full Service 4639444 ASHWORTH ROAD BRANCH 6139 ASHWORTH ROAD WEST DES MOINES OK Full Service 4155131 MILLS ClVJCPARr-NAY BRANCH 5070 MILLS CIVIC PARKWAY WEST DES MOINES
State Zip Code County IA 505BS BUENA VISTA IA 50023 POLK IA 51012 CHEROKEE IA 51012 CHEROKEE IA 50311 POLK
IA 50317 POLK IA 50309 POLK IA 51106 WOODBURY
IA 51101 WOODBURY
IA 51104 WOODBURY IA Sl360 DICKINSON IA 505BBmiddot19 BUENA VISTA IA 50322 POLK IA S0266 POLK IA 50266 POLK IA 50265 POLK
Country FDICUNINUM+ Office Numberbull Head Offlce Head Office ID RSSDbull Comments UNITED STATES 9849 0 CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544 UNITED STATES 263121 6 CENTRAL BANK 546544 UNITED STATES 6467 3 CENTRAL BANK 545544 UNITED STATES Not Requred Not Required CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544
UNITED STATES Not Required Not Required CENTRAL BANK 546S44 UNITED STATES Not Required Nol Required CENTRAL BANK S46544 UNITED STATES 362876 7 CENTRAL BANK S45544 UNITED STATES 465474 9 CENTRAL BANK S46544
UNITED STATES 9695 8 CENTRAL BANK 546544
UNITED STATES 234537 l CENTRAL BANK 546S44 UNITED STATES Not Required Not Required CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544
UNITED STATES Not Required Not Requred CENTRAL BANK 546544
UNITED STATES Nol Required Not Required CENTRAL BANK 546544
Report Item 4 - Brincipal Shareholders Director Executive Officer ofBaMlHolding Company
1 (1) Name and adhress middoti
(2) Principal oc4Lation if other than with Miaing company
(3) Title or posltion with 1 I (a) Bank ho)g company
I j
(b) See Atta9ped I ( c) Other busfuess companies
l TossLLC Toss IT1f-LC
i Imiddot ( 4) Number of sliitres and percentage
of voting sedrities owned middot controlled oJ eldwith power to vote ii (a) Barik holtlmg company -1
Clas Common Class Common (Nobivoting)
i I (b) Subsidiaries of bank
h ld ti 0 mgmiddot1rmpany
i (c) Otherbusillfss companies
I
TossLic Meser units
Toss II ILLC Member units
I
Timothy J Brown Storm Lake Iowa
NIA
President and Director
Member Member
5009 Shares 5967
1296 Shares 9460
None
1667
1667
John C Brown Spirit Lake Iowa
NIA
Secretary Treasurer and Director
Member Member
3385 Shares 4033
44 Shares 321
None
1667
1667
r
Report Item 4 - Rrincipal Shareholders Director Executive Officer of BanhlEolding Company
middotI
(3) Title or p9itiori with middotI I
bull1 (b) Subsidiaes of
holding 1qompany
Central Bank I I
middot1 ti
Jvlilford Holtljitgs Inc I
i
I
I
middotl 1 i
i
Timothy J Brown Storm Lake Iowa
President and Director
President and Director
John C Brown Spirit Lake Iowa
Executive ViceshyPresident Secretary and Director
Executive ViceshyPtesident Secretary and Director
- FR Y-6 Cover Page
- For Use By Tiered Holding Companies
- Report Item 1 Annual Report to Shareholders
- Report Item 2a Organization Chart
- Report Item 2b Domestic Branch Listing
- Report Item 3 Securities Holders
- Report Item 4 Insiders
-
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
STATEMENTS OF COMPREHENSIVE INCOME Years Ended December 31 2014 and 2013
2014 2013
NET INCOME $ 9783824 $ 2394197
Other comprehensive loss Unrealized gains (losses) on subsidiary
available-for-sale securities Income tax benefit
Total other comprehensive Joss
Total comprehensive income
4
(98409) 37395
(61014)
(412795) 156863
(255932)
$ 9722810 $ 2 138265
bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull
BALANCE DECEMBER 31 2012 Net income
Other comprehensive loss
Redemption of 53 shares of Class B common stock
Issuance of 30 shares of Class B common stock
Dividends declared and paid
BALANCE DECEMBER 31 2013 Net income
Other comprehensive loss
Redemption of 30 shares of Class B common stock
Issuance of 30 shares of Class B common stock
Dividends declared
BALANCE DECEMBER 31 2014
COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
STATEMENTS OF STOCKHOLDERS EQUITY Years Ended December 31 2014 and 2013
Retained Earnings
Accumulated Other
Comprehensive Income
Common Stock Class A Class B
$ 52543726 $ 29438533 $ 428360 $ 1298505 $ 378328 $
2394197
(255932) (81431) 95243
(420000)
54275803 9783824
(61013) (95243) 101471
(451755)
2394197
(420000)
31412730 9783824
(451755)
(255932)
172428 1298505
(61013)
(81431) 95243
392140
(95243) 101471
$ 63 5_53 087 $ 40 744 799 $1h1b1plusmn4gt15 $ 1 298 505 $ 398 368 $
5
Class A Preferred
Stock
Senior Preferred
Stock
3000000 $ 18000000
3000000 18000000
3 000 000 $ 18 000 000
bull bull COMMERCIAL FINANCIAL CORP
(PARENT COMPANY ONLY)
bull STATEMENTS OF CASH FLOWS Years Ended December 31 2014 and 2013
bull bull 2014 2013
bull CASH FLOWS FROM OPERATING ACTIVITIES Net income $ 9783824 $ 2394 197
bull Adjustments to reconcile net income to net cash used in operating activities
bull Equity in earnings of subsidiaries (10001319) (2824716) Losses on other assets 3618 3980
bull Effects of changes in operating assets and liabilities Due to and from subsidiaries (1304582) 1596002
bull Other (14949) Income tax receivable 1394565 (1368384) bull Notes receivable - related parties (2513) 4353
bull Deferred income taxes 17756 Accrued interest receivable (2798) 1391
bull Accrued interest payable 919 (209)
bull Net cash used in operating activities (125479) (193386)
bull CASH FLOWS FROM INVESTING ACTIVITIES Dividends received from subsidiaries 2500000 1250000
bull Loans receivable - participation (2000000) Investment in limited liability company (9382) (650724)
bull Other 2000 1500
bull Net cash provided by investing activities 492618 600776
bull CASH FLOWS FROM FINANCING ACTIVITIES Dividends paid to stockholders (406755) (465000)
bull Proceeds from issuance of Class B common stock 101471 95243
bull Payment to redeem Class B common stock (95243) (81431)
Net cash provided by financing activities (400527) (451 188)
bull NET DECREASE IN CASH (33388) (43798) bull
bull CASH BEGINNING OF YEAR 514943 558741
bull CASH END OF YEAR $ 481555 $ 514943
bull SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
bull Cash paid for interest was $165561 in 2014 and $169 187 in 2013 Cash received for income taxes was $219000 in 2014 and $435 170 in 2013
bull SUPPLEMENTAL DISCLOSURE OF NONCASH FINANCING ACTIVITIES Dividends declared on Senior Preferred stock of $45000 in 2014
bull is included in liabilities
bull bull
6
bull
bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull
COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Commercial Financial Corp (the Company) is an Iowa-based bank holding company At December 31 2014 the Company owns 100 of the voting common stock of Central Bank headquartered in Storm Lake Iowa During 2014 Lakes Bancorporation Inc was merged into Central Bank thereby increasing the Companys direct ownership in Central Bank to 100 Previously the Company owned 65 of Central Bank and 100 of Lakes Bancorporation which owned 35 of Central Bank Central Bank owns 100 of the common stock of Milford Holdings Inc and 100 of the membership interest in Real Estate Owned LLC and Central Florida Real Estate Owned LLC The Company also owns 100 of the common stock of Central Statutory Trust II (Central Statutory Trust)
The principal market areas for the Company and its subsidiaries are Storm Lake Cherokee Spirit Lake Sioux City Des Moines and the surrounding Iowa communities
The Companys subsidiaries make commercial agricultural real estate and installment loans to businesses and individuals as well as maintaining deposits for customers in their market areas
Use of Estimates in Preparing Financial Statements
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period Actual results could vary from those estimates
Investments in Subsidiaries
Accounting standards require the consolidation of majority-owned subsidiaries with the parent for financial reporting purposes Commercial Financial Corps wholly-owned subsidiaries Central Bank and Central Statutory Trust are included in the accompanying financial statements under the equity method rather than consolidated with the Company (See Note 6)
The accompanying financial statements are not intended to replace any consolidated financial statements of Commercial Financial Corp and subsidiaries
NOTE 2 - GROUP CONCENTRATION OF CREDIT RISK
The Companys primary business activity is with Central Bank in Storm Lake Cherokee Spirit Lake Des Moines and Sioux City Iowa The Bank makes commercial agricultural real estate and installment loans to customers in the Storm Lake Cherokee Spirit Lake Des Moines and Sioux City Iowa areas Although the Bank has a diversified loan portfolio a substantial portion of its debtors ability to honor their contracts is dependent upon the agricultural economy
7
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 3 - SUBORDINATED DEBENTURES PAYABLE TO NONBANK SUBSIDIARY
Subordinated debentures payable to nonbank subsidiary at December 31 2014 and 2013 represents indebtedness to Central Statutory Trust II and bears interest at a rate equal to the 3-month LIBOR rate plus 175 At December 31 2014 and 2013 the interest rate was 199 and 199 respectively The principal amounts of the debentures are due June 21 2037
NOTE 4 - INCOME TAXES
The Company and its subsidiaries file consolidated federal and State of Iowa income tax return The subsidiaries provide for income taxes on a separate return basis and remit to the Company amounts determined to be currently payable
The Company follows the accounting requirements for uncertain tax positions The Company determined that no liability related to uncertain tax positions was required as of December 31 2014 and 2013
The federal and state income tax returns of the Company for 2011 and thereafter are subject to examination by the IRS and state taxing authorities generally for three years after they were filed
NOTE 5 - RESTRICTIONS ON SUBSIDIARY DIVIDENDS
The ability of the Company to service its debt is dependent on cash dividends paid to the Company by its subsidiary bank The Bank is a state chartered bank that is also a member of a federal reserve bank The subsidiary bank is subject to certain statutory and regulatory restrictions on the amount it may pay in dividends
A state bank that is registered as a federal reserve bank may not pay a dividend which would impair the capital of the bank A federal reserve member bank is required to obtain prior approval of the Board of Governors of the Federal Reserve System if the total of all dividends including the proposed dividends declared by the bank in any calendar year exceeds the total of the banks net profits of that year combined with its retained net profits of the preceding two years In addition a bank chartered under Iowa law may pay dividends up to the amount of its undivided profits provided its surplus account equals or exceeds its capital account subject to maintenance of minimum capital requirements
8
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 6 - SUBSIDIARY CONDENSED FINANCIAL STATEMENTS
The following is a summary of selected unaudited financial information of Central Bank based upon the December 31 2014 and 2013 financial statements submitted to the Federal Deposit Insurance Corporation
2014 2013
Total assets $ 655686000 $ 651573000
Liabilities $ 588121000 $ 591764000 Stockholders equity 67565000 59809000
Total liabilities and stockholders equity $ 655686000 $ 651573000
Net income $ 10001000 $ 2825000
During 2014 Lakes Bancorporation Inc was merged into Central Bank In connection with the merger the Company recognized $911572 in excess of cost over net assets of subsidiaries (goodwill) which had been previously recognized by Lakes Bancorporation Inc The following is a summary of selected unaudited parent company only financial information of Lakes Bancorporation based on December 31 2013 parent company only financial statements filed with the Federal Reserve System
2013
Total assets $ 21 916000
Liabilities $ Stockholders equity 21 916000
Total liabilities and stockholders equity $ 21 916000
Net income $ 989000
Central Bank owns 100 of the common stock of Milford Holdings Inc The following is a summary of selected unaudited financial information of Milford Holdings Inc
2014 2013
Total assets $ 7660000 $ 7022000
Liabilities $ 31000 $ Stockholders equity 7629000 7022000
Total liabilities and stockholders equity $ 7660000 $ 7022000
Net income $ 607000 $ 370000
9
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 6 - SUBSIDIARY CONDENSED FINANCIAL STATEMENTS (CONTINUED)
During 2013 Central Bank acquired 100 of the membership interest in Real Estate Owned LLC The following is a summary of selected unaudited financial information of Real Estate Owned LLC
2014 2013
Total assets $ 4508000 $ 3456000
Liabilities $ 17000 $ Stockholders equity 4491000 3456000
Total liabilities and stockholders equity $ 4508000 $ 3456000
Net income $ 206000 $
During 2013 Central Bank acquired 100 of the membership interest in Central Florida Real Estate Owned LLC The following is a summary of selected unaudited financial information of Central Florida Real Estate Owned LLC
Total assets
Liabilities Stockholders equity
Total liabilities and stockholders equity
Net income
$
$
$
$
2014 2013
744000 $ 1476000
$ 744000 1476000
744000 $ 1476000
140000 $
The Company owns 100 of the trust common securities of Central Statutory Trust II Central Statutory Trust II was formed to issue Company obligated mandatorily redeemable preferred securities (Preferred Securities) Central Statutory Trust II has issued all of the 8000000 authorized shares of preferred securities The preferred securities are considered liabilities on the balance sheet for Central Statutory Trust II For regulatory purposes a portion of the preferred securities are allowed in the calculation of Tier 1 and Tier 2 capital of the Company
10
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 6 - SUBSIDIARY CONDENSED FINANCIAL STATEMENTS (CONTINUED)
The following is a summary of selected unaudited financial information of Central Statutory Trust II based on December 31 2014 and 2013 quarterly financial statements of nonbank subsidiaries filed with the Federal Reserve System
2014 2013
Total assets $ 8248000 $ 8248000
Liabilities $ 8000000 $ 8000000 Stockholders equity 248000 248000
Total liabilities and stockholders equity $ 8248000 $ 8248000
Net income $ $
NOTE 7 - SENIOR PREFERRED STOCK
The Company executed a Small Business Lending Fund Securities Purchase Agreement with the United States Department of the Treasury (Treasury) effective September 20 2011 Through the Small Business Lending Fund (SBLF) the Treasury provides Tier 1 capital to community banks and other eligible institutions Each institution pays dividend rates that go down as its small business lending goes up
Treasury was issued 18000 shares of Senior Non-Cumulative Perpetual Preferred Stock Series A for $18000000 on September 20 2011 The initial dividend rate was 5 The variable dividend rate may decrease each of the following nine quarters based on the increase in qualified small business lending as defined in the agreement The dividend rate will vary between 1 and 5 as lending increases vary between 10 and 25 The fixed dividend rate for the tenth quarter after funding through the end of the first four and one-half years is set as described above if lending has increased at the end of the eighth quarter after funding If lending has not increased at the end of the eighth quarter after funding the fixed dividend rate is set at 7 The fixed dividend rate after four and one-half years is set at 9 if the funding has not already been repaid The dividend rate at December 31 2014 and 2013 was 1 for both years
The Treasury has a liquidation preference of $1000 per share or $18000000 as of December 31 2014 Dividends are payable quarterly in arrears on January 1 April 1 July 1 and October 1 of each year Dividends payable at December 31 2014 and 2013 are $45000 and $0 respectively The Company may repay the funding at any time with regulatory approval
11
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 8 - ACCUMULATED OTHER COMPREHENSIVE INCOME
Central Bank and Milford Holdings Inc maintain certain securities in an available-for-sale category At December 31 2014 and 2013 combined accumulated other comprehensive income related to available-for-sale securities in the amount of $111415 and $172428 respectively was recorded directly to the Companys stockholders equity for its 100 proportionate share of the other comprehensive income
NOTE 9 - SUBSEQUENT EVENTS
Management evaluated subsequent events through March 6 2015 the date the financial statements were available to be issued Events or transactions occurring after December 31 2014 but prior to March 6 2015 that provided additional evidence about conditions that existed at December 31 2014 have been recognized in the financial statements for the year ended December 31 2014 Events or transactions that provided evidence about conditions that did not exist at December 31 2014 but arose before the financial statements were available to be issued have not been recognized in the financial statements for the year ended December 31 2014
See accountants compilation report
12
COMMERCIAL FINANCIAL CORP
Report - rem J Commercial Fuianc1al Corp is not required to file with the Secunt1es and
Exchange Comfriiksion r bull 1 R
eport
Item 111 Fmancial statenints parent company only of Commercial Fmancial Corp middotI
are attached Cppsolidated financial statements are not prepared h 1 I I fb m t e norma colirtse o usmess
Report-Item 2J U Organizational Chart middot See attabhed chart
Report- Item 2J k Banch Verification l Ii See attced chart
Report-Item 3 l middot middot Listing of sharehfders that directly or indirectly own control or hold with power to v9t 5 or more of any class of shares of the bank holding Company middotmiddotj
gt ll I
Name andAddrJJs J Timothy J Brovampn 1 Storm Lake IoWa I
i
John C Brown f 1 Spirit Lake IovM
1 f - (
Citizenship
1JSA
USA
Report Item 4 -se Schedule Attached
t
l H
il
Class A Common
Shares Owned
5009
3385
Percentage
5967
4033
Class B Common
Shares Owned
1296
44
Percentage
9460
321
ORGANIZATIONAL CHART
Report - Item 2(a) - Organization chart - Commercial Financial Corp Incorporated State of Iowa - Lakes Bancorporation Inc Incorporated State of Iowa - Central Bank Incorporated State of Iowa - Milford Holdings Inc Incorporated State of Iowa - Central Statutory Trust II Deleware Statutory Trust - Real Estate Owned LLC lncorprated State of Iowa - Central Florida Real Estate Owned LLC Incorporated State of Florida - Toss II LLC Incorporated State of Iowa
COMMERCIAL FINANCIAL CORP STORM LAKE IA
Non-Managing M Owns 40
ember
Toss II LLC Stonn Lake IA
Footnotes
Owns 65
CENTRAL BANK
STORM LAKE IA
Owns 100
MILFORD HOLDINGS INC STORM LAKE IA
(See footnote 1)
Lakes Bancorporation Inc
Stonn Lake IA
Owns 35
Managing Member Owns 100
REAL ESTATE OWNED LLC
STORM LAKE IA
1 Commercial Financial Corp owns 5540000 (100) of the outstanding shares of voting common stock
Owns 100
CENTRAL STATUTORY TRUST II
STORM LAKE IA
Managing Memb Owns 100
CENTRAL FLORIDA REAL ESTATE OWNED LLC
STORM LAKE IA
er
Results A list of branches for your holding company COMMERC1ALflNANCJALCORP (1978574) of STORM IAKE IA The data are as of 12312014 Data reflects lnfo1maton that was received and processd through Ol07 2015
Reconcl1alon md Vertncaloo SICli 1 Jn the Data Action column of each branch row enter one or more of the actions specified below 2 If required enter the date In the Effective Date column
Actions OK If the branch Information Is correct enterOK In the Data Action coumn
Change tr the branch Information Is Incorrect or Incomplete revise the data enterOrnnge In the Data Action colllmn and the date when this Information rlrstbecame vaJd In the Effective Dale column Close If a branch lsted was sold or closed enter Clos In the Data Actlori column and the sale or closure date In the Effective Date coumn Delete ]f a branch Med was never owned by this depository Institution enter Odele In the Data Action column Add Jf a reportable branch Is missing Insert a row add the branch data and enterAdd In the Data Action column and the opening or acqulsltfon date In theEHectlve Date column
If printing this Hsi you may need to adjust your pa Be setup In MS Excel Try uslng landscape orientation page scaling andor e(lal siled paper
Submission Procedure When you are finished send a saved copy to your FRB contact See the detailed Instructions on this site for more Information If you are e-malllng th ls to your FRB contact put your Institution name dty and state In the subject tine of the emiddotmall
Note To sltitislythe FR YmiddotlO reporting requirements you must aim submit FR YmiddotlO Domestic Branch Schedules for each branch with a Data Action of Q1ange dose Delete or Add The FR Y-10 report may be submitted In a hardcopy format or via the FR YmiddotlO Onlne applcatlon bull httpsylOonUnefederalreservegov
bull FOCUNINUM Office Number and D_RSSD columns are for reference only Verlflcatron of these values ls not required
Data Action Effective Date Branch Service Type Branch ID RSSDbull Popular Name Street Address City
OK Full Service Head Office) 545544 CENTRAL BANK 600 LAKE AVENUE STORM lAKE OK Full Service 4154B52 ANKENY BOULEVARD BRANCH 2805 NORTH ANKENY BOULEVARD ANKENY
OK Umlted Servke 2116588 CHEROKEE BRANCH 2BOW DRIVE CHEROKEE
OK Full Service 802848 CHEROKEE CENTRAL TRUST BRANCH 401 WEST MAIN STREET CHEROKEE
OK Full Service 2161147 4018 UNIVERSITY AVENUEOFFJCE 4018 UNIVERSITY AVENUE DES MOINES
OK Full Service 4155104 HUBBEL AVENUE BRANCH 2742 HUBBELLAVENUE DES MOINES
OK Full Service 4155270 WALNUT STREETS RANCH 700 WALNUT STREET DES MOINES
OK Full Service 4493169 4201 SOUTH LAKEPORT BRANCH 4201 SOUTH LAKEPORT SIOUX CITY
OK FuI Service 3078064 522 fOURTH STREET BRANCH 522 4TH STREET SIOUX CITY
OK Full Service 3596719 stoux OiY BRANCH 2-906 HAMILTON BLVD SIOUX CITY
OK Full Servke 810142 SPIRIT IAKE BRANCH 1400 1BTH STREET SPIRIT LAKE
OK limited Service 2045050 DRIVEmiddotIN BRANCH 1237 LAKE AVENUE STORM LAKE
OK Full Servke 4155252 URBANDALE BRANCH 3800 lOOTH STREET URBANDALE
OK Full Service 44931SO 6501 WESTOWN PARKWAY BRANCH 6601 WESTOWN PARKWAYSUITE140 WEST DES MOINES
OK Full Service 4639444 ASHWORTH ROAD BRANCH 6139 ASHWORTH ROAD WEST DES MOINES OK Full Service 4155131 MILLS ClVJCPARr-NAY BRANCH 5070 MILLS CIVIC PARKWAY WEST DES MOINES
State Zip Code County IA 505BS BUENA VISTA IA 50023 POLK IA 51012 CHEROKEE IA 51012 CHEROKEE IA 50311 POLK
IA 50317 POLK IA 50309 POLK IA 51106 WOODBURY
IA 51101 WOODBURY
IA 51104 WOODBURY IA Sl360 DICKINSON IA 505BBmiddot19 BUENA VISTA IA 50322 POLK IA S0266 POLK IA 50266 POLK IA 50265 POLK
Country FDICUNINUM+ Office Numberbull Head Offlce Head Office ID RSSDbull Comments UNITED STATES 9849 0 CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544 UNITED STATES 263121 6 CENTRAL BANK 546544 UNITED STATES 6467 3 CENTRAL BANK 545544 UNITED STATES Not Requred Not Required CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544
UNITED STATES Not Required Not Required CENTRAL BANK 546S44 UNITED STATES Not Required Nol Required CENTRAL BANK S46544 UNITED STATES 362876 7 CENTRAL BANK S45544 UNITED STATES 465474 9 CENTRAL BANK S46544
UNITED STATES 9695 8 CENTRAL BANK 546544
UNITED STATES 234537 l CENTRAL BANK 546S44 UNITED STATES Not Required Not Required CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544
UNITED STATES Not Required Not Requred CENTRAL BANK 546544
UNITED STATES Nol Required Not Required CENTRAL BANK 546544
Report Item 4 - Brincipal Shareholders Director Executive Officer ofBaMlHolding Company
1 (1) Name and adhress middoti
(2) Principal oc4Lation if other than with Miaing company
(3) Title or posltion with 1 I (a) Bank ho)g company
I j
(b) See Atta9ped I ( c) Other busfuess companies
l TossLLC Toss IT1f-LC
i Imiddot ( 4) Number of sliitres and percentage
of voting sedrities owned middot controlled oJ eldwith power to vote ii (a) Barik holtlmg company -1
Clas Common Class Common (Nobivoting)
i I (b) Subsidiaries of bank
h ld ti 0 mgmiddot1rmpany
i (c) Otherbusillfss companies
I
TossLic Meser units
Toss II ILLC Member units
I
Timothy J Brown Storm Lake Iowa
NIA
President and Director
Member Member
5009 Shares 5967
1296 Shares 9460
None
1667
1667
John C Brown Spirit Lake Iowa
NIA
Secretary Treasurer and Director
Member Member
3385 Shares 4033
44 Shares 321
None
1667
1667
r
Report Item 4 - Rrincipal Shareholders Director Executive Officer of BanhlEolding Company
middotI
(3) Title or p9itiori with middotI I
bull1 (b) Subsidiaes of
holding 1qompany
Central Bank I I
middot1 ti
Jvlilford Holtljitgs Inc I
i
I
I
middotl 1 i
i
Timothy J Brown Storm Lake Iowa
President and Director
President and Director
John C Brown Spirit Lake Iowa
Executive ViceshyPresident Secretary and Director
Executive ViceshyPtesident Secretary and Director
- FR Y-6 Cover Page
- For Use By Tiered Holding Companies
- Report Item 1 Annual Report to Shareholders
- Report Item 2a Organization Chart
- Report Item 2b Domestic Branch Listing
- Report Item 3 Securities Holders
- Report Item 4 Insiders
-
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BALANCE DECEMBER 31 2012 Net income
Other comprehensive loss
Redemption of 53 shares of Class B common stock
Issuance of 30 shares of Class B common stock
Dividends declared and paid
BALANCE DECEMBER 31 2013 Net income
Other comprehensive loss
Redemption of 30 shares of Class B common stock
Issuance of 30 shares of Class B common stock
Dividends declared
BALANCE DECEMBER 31 2014
COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
STATEMENTS OF STOCKHOLDERS EQUITY Years Ended December 31 2014 and 2013
Retained Earnings
Accumulated Other
Comprehensive Income
Common Stock Class A Class B
$ 52543726 $ 29438533 $ 428360 $ 1298505 $ 378328 $
2394197
(255932) (81431) 95243
(420000)
54275803 9783824
(61013) (95243) 101471
(451755)
2394197
(420000)
31412730 9783824
(451755)
(255932)
172428 1298505
(61013)
(81431) 95243
392140
(95243) 101471
$ 63 5_53 087 $ 40 744 799 $1h1b1plusmn4gt15 $ 1 298 505 $ 398 368 $
5
Class A Preferred
Stock
Senior Preferred
Stock
3000000 $ 18000000
3000000 18000000
3 000 000 $ 18 000 000
bull bull COMMERCIAL FINANCIAL CORP
(PARENT COMPANY ONLY)
bull STATEMENTS OF CASH FLOWS Years Ended December 31 2014 and 2013
bull bull 2014 2013
bull CASH FLOWS FROM OPERATING ACTIVITIES Net income $ 9783824 $ 2394 197
bull Adjustments to reconcile net income to net cash used in operating activities
bull Equity in earnings of subsidiaries (10001319) (2824716) Losses on other assets 3618 3980
bull Effects of changes in operating assets and liabilities Due to and from subsidiaries (1304582) 1596002
bull Other (14949) Income tax receivable 1394565 (1368384) bull Notes receivable - related parties (2513) 4353
bull Deferred income taxes 17756 Accrued interest receivable (2798) 1391
bull Accrued interest payable 919 (209)
bull Net cash used in operating activities (125479) (193386)
bull CASH FLOWS FROM INVESTING ACTIVITIES Dividends received from subsidiaries 2500000 1250000
bull Loans receivable - participation (2000000) Investment in limited liability company (9382) (650724)
bull Other 2000 1500
bull Net cash provided by investing activities 492618 600776
bull CASH FLOWS FROM FINANCING ACTIVITIES Dividends paid to stockholders (406755) (465000)
bull Proceeds from issuance of Class B common stock 101471 95243
bull Payment to redeem Class B common stock (95243) (81431)
Net cash provided by financing activities (400527) (451 188)
bull NET DECREASE IN CASH (33388) (43798) bull
bull CASH BEGINNING OF YEAR 514943 558741
bull CASH END OF YEAR $ 481555 $ 514943
bull SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
bull Cash paid for interest was $165561 in 2014 and $169 187 in 2013 Cash received for income taxes was $219000 in 2014 and $435 170 in 2013
bull SUPPLEMENTAL DISCLOSURE OF NONCASH FINANCING ACTIVITIES Dividends declared on Senior Preferred stock of $45000 in 2014
bull is included in liabilities
bull bull
6
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Commercial Financial Corp (the Company) is an Iowa-based bank holding company At December 31 2014 the Company owns 100 of the voting common stock of Central Bank headquartered in Storm Lake Iowa During 2014 Lakes Bancorporation Inc was merged into Central Bank thereby increasing the Companys direct ownership in Central Bank to 100 Previously the Company owned 65 of Central Bank and 100 of Lakes Bancorporation which owned 35 of Central Bank Central Bank owns 100 of the common stock of Milford Holdings Inc and 100 of the membership interest in Real Estate Owned LLC and Central Florida Real Estate Owned LLC The Company also owns 100 of the common stock of Central Statutory Trust II (Central Statutory Trust)
The principal market areas for the Company and its subsidiaries are Storm Lake Cherokee Spirit Lake Sioux City Des Moines and the surrounding Iowa communities
The Companys subsidiaries make commercial agricultural real estate and installment loans to businesses and individuals as well as maintaining deposits for customers in their market areas
Use of Estimates in Preparing Financial Statements
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period Actual results could vary from those estimates
Investments in Subsidiaries
Accounting standards require the consolidation of majority-owned subsidiaries with the parent for financial reporting purposes Commercial Financial Corps wholly-owned subsidiaries Central Bank and Central Statutory Trust are included in the accompanying financial statements under the equity method rather than consolidated with the Company (See Note 6)
The accompanying financial statements are not intended to replace any consolidated financial statements of Commercial Financial Corp and subsidiaries
NOTE 2 - GROUP CONCENTRATION OF CREDIT RISK
The Companys primary business activity is with Central Bank in Storm Lake Cherokee Spirit Lake Des Moines and Sioux City Iowa The Bank makes commercial agricultural real estate and installment loans to customers in the Storm Lake Cherokee Spirit Lake Des Moines and Sioux City Iowa areas Although the Bank has a diversified loan portfolio a substantial portion of its debtors ability to honor their contracts is dependent upon the agricultural economy
7
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 3 - SUBORDINATED DEBENTURES PAYABLE TO NONBANK SUBSIDIARY
Subordinated debentures payable to nonbank subsidiary at December 31 2014 and 2013 represents indebtedness to Central Statutory Trust II and bears interest at a rate equal to the 3-month LIBOR rate plus 175 At December 31 2014 and 2013 the interest rate was 199 and 199 respectively The principal amounts of the debentures are due June 21 2037
NOTE 4 - INCOME TAXES
The Company and its subsidiaries file consolidated federal and State of Iowa income tax return The subsidiaries provide for income taxes on a separate return basis and remit to the Company amounts determined to be currently payable
The Company follows the accounting requirements for uncertain tax positions The Company determined that no liability related to uncertain tax positions was required as of December 31 2014 and 2013
The federal and state income tax returns of the Company for 2011 and thereafter are subject to examination by the IRS and state taxing authorities generally for three years after they were filed
NOTE 5 - RESTRICTIONS ON SUBSIDIARY DIVIDENDS
The ability of the Company to service its debt is dependent on cash dividends paid to the Company by its subsidiary bank The Bank is a state chartered bank that is also a member of a federal reserve bank The subsidiary bank is subject to certain statutory and regulatory restrictions on the amount it may pay in dividends
A state bank that is registered as a federal reserve bank may not pay a dividend which would impair the capital of the bank A federal reserve member bank is required to obtain prior approval of the Board of Governors of the Federal Reserve System if the total of all dividends including the proposed dividends declared by the bank in any calendar year exceeds the total of the banks net profits of that year combined with its retained net profits of the preceding two years In addition a bank chartered under Iowa law may pay dividends up to the amount of its undivided profits provided its surplus account equals or exceeds its capital account subject to maintenance of minimum capital requirements
8
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 6 - SUBSIDIARY CONDENSED FINANCIAL STATEMENTS
The following is a summary of selected unaudited financial information of Central Bank based upon the December 31 2014 and 2013 financial statements submitted to the Federal Deposit Insurance Corporation
2014 2013
Total assets $ 655686000 $ 651573000
Liabilities $ 588121000 $ 591764000 Stockholders equity 67565000 59809000
Total liabilities and stockholders equity $ 655686000 $ 651573000
Net income $ 10001000 $ 2825000
During 2014 Lakes Bancorporation Inc was merged into Central Bank In connection with the merger the Company recognized $911572 in excess of cost over net assets of subsidiaries (goodwill) which had been previously recognized by Lakes Bancorporation Inc The following is a summary of selected unaudited parent company only financial information of Lakes Bancorporation based on December 31 2013 parent company only financial statements filed with the Federal Reserve System
2013
Total assets $ 21 916000
Liabilities $ Stockholders equity 21 916000
Total liabilities and stockholders equity $ 21 916000
Net income $ 989000
Central Bank owns 100 of the common stock of Milford Holdings Inc The following is a summary of selected unaudited financial information of Milford Holdings Inc
2014 2013
Total assets $ 7660000 $ 7022000
Liabilities $ 31000 $ Stockholders equity 7629000 7022000
Total liabilities and stockholders equity $ 7660000 $ 7022000
Net income $ 607000 $ 370000
9
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 6 - SUBSIDIARY CONDENSED FINANCIAL STATEMENTS (CONTINUED)
During 2013 Central Bank acquired 100 of the membership interest in Real Estate Owned LLC The following is a summary of selected unaudited financial information of Real Estate Owned LLC
2014 2013
Total assets $ 4508000 $ 3456000
Liabilities $ 17000 $ Stockholders equity 4491000 3456000
Total liabilities and stockholders equity $ 4508000 $ 3456000
Net income $ 206000 $
During 2013 Central Bank acquired 100 of the membership interest in Central Florida Real Estate Owned LLC The following is a summary of selected unaudited financial information of Central Florida Real Estate Owned LLC
Total assets
Liabilities Stockholders equity
Total liabilities and stockholders equity
Net income
$
$
$
$
2014 2013
744000 $ 1476000
$ 744000 1476000
744000 $ 1476000
140000 $
The Company owns 100 of the trust common securities of Central Statutory Trust II Central Statutory Trust II was formed to issue Company obligated mandatorily redeemable preferred securities (Preferred Securities) Central Statutory Trust II has issued all of the 8000000 authorized shares of preferred securities The preferred securities are considered liabilities on the balance sheet for Central Statutory Trust II For regulatory purposes a portion of the preferred securities are allowed in the calculation of Tier 1 and Tier 2 capital of the Company
10
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 6 - SUBSIDIARY CONDENSED FINANCIAL STATEMENTS (CONTINUED)
The following is a summary of selected unaudited financial information of Central Statutory Trust II based on December 31 2014 and 2013 quarterly financial statements of nonbank subsidiaries filed with the Federal Reserve System
2014 2013
Total assets $ 8248000 $ 8248000
Liabilities $ 8000000 $ 8000000 Stockholders equity 248000 248000
Total liabilities and stockholders equity $ 8248000 $ 8248000
Net income $ $
NOTE 7 - SENIOR PREFERRED STOCK
The Company executed a Small Business Lending Fund Securities Purchase Agreement with the United States Department of the Treasury (Treasury) effective September 20 2011 Through the Small Business Lending Fund (SBLF) the Treasury provides Tier 1 capital to community banks and other eligible institutions Each institution pays dividend rates that go down as its small business lending goes up
Treasury was issued 18000 shares of Senior Non-Cumulative Perpetual Preferred Stock Series A for $18000000 on September 20 2011 The initial dividend rate was 5 The variable dividend rate may decrease each of the following nine quarters based on the increase in qualified small business lending as defined in the agreement The dividend rate will vary between 1 and 5 as lending increases vary between 10 and 25 The fixed dividend rate for the tenth quarter after funding through the end of the first four and one-half years is set as described above if lending has increased at the end of the eighth quarter after funding If lending has not increased at the end of the eighth quarter after funding the fixed dividend rate is set at 7 The fixed dividend rate after four and one-half years is set at 9 if the funding has not already been repaid The dividend rate at December 31 2014 and 2013 was 1 for both years
The Treasury has a liquidation preference of $1000 per share or $18000000 as of December 31 2014 Dividends are payable quarterly in arrears on January 1 April 1 July 1 and October 1 of each year Dividends payable at December 31 2014 and 2013 are $45000 and $0 respectively The Company may repay the funding at any time with regulatory approval
11
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 8 - ACCUMULATED OTHER COMPREHENSIVE INCOME
Central Bank and Milford Holdings Inc maintain certain securities in an available-for-sale category At December 31 2014 and 2013 combined accumulated other comprehensive income related to available-for-sale securities in the amount of $111415 and $172428 respectively was recorded directly to the Companys stockholders equity for its 100 proportionate share of the other comprehensive income
NOTE 9 - SUBSEQUENT EVENTS
Management evaluated subsequent events through March 6 2015 the date the financial statements were available to be issued Events or transactions occurring after December 31 2014 but prior to March 6 2015 that provided additional evidence about conditions that existed at December 31 2014 have been recognized in the financial statements for the year ended December 31 2014 Events or transactions that provided evidence about conditions that did not exist at December 31 2014 but arose before the financial statements were available to be issued have not been recognized in the financial statements for the year ended December 31 2014
See accountants compilation report
12
COMMERCIAL FINANCIAL CORP
Report - rem J Commercial Fuianc1al Corp is not required to file with the Secunt1es and
Exchange Comfriiksion r bull 1 R
eport
Item 111 Fmancial statenints parent company only of Commercial Fmancial Corp middotI
are attached Cppsolidated financial statements are not prepared h 1 I I fb m t e norma colirtse o usmess
Report-Item 2J U Organizational Chart middot See attabhed chart
Report- Item 2J k Banch Verification l Ii See attced chart
Report-Item 3 l middot middot Listing of sharehfders that directly or indirectly own control or hold with power to v9t 5 or more of any class of shares of the bank holding Company middotmiddotj
gt ll I
Name andAddrJJs J Timothy J Brovampn 1 Storm Lake IoWa I
i
John C Brown f 1 Spirit Lake IovM
1 f - (
Citizenship
1JSA
USA
Report Item 4 -se Schedule Attached
t
l H
il
Class A Common
Shares Owned
5009
3385
Percentage
5967
4033
Class B Common
Shares Owned
1296
44
Percentage
9460
321
ORGANIZATIONAL CHART
Report - Item 2(a) - Organization chart - Commercial Financial Corp Incorporated State of Iowa - Lakes Bancorporation Inc Incorporated State of Iowa - Central Bank Incorporated State of Iowa - Milford Holdings Inc Incorporated State of Iowa - Central Statutory Trust II Deleware Statutory Trust - Real Estate Owned LLC lncorprated State of Iowa - Central Florida Real Estate Owned LLC Incorporated State of Florida - Toss II LLC Incorporated State of Iowa
COMMERCIAL FINANCIAL CORP STORM LAKE IA
Non-Managing M Owns 40
ember
Toss II LLC Stonn Lake IA
Footnotes
Owns 65
CENTRAL BANK
STORM LAKE IA
Owns 100
MILFORD HOLDINGS INC STORM LAKE IA
(See footnote 1)
Lakes Bancorporation Inc
Stonn Lake IA
Owns 35
Managing Member Owns 100
REAL ESTATE OWNED LLC
STORM LAKE IA
1 Commercial Financial Corp owns 5540000 (100) of the outstanding shares of voting common stock
Owns 100
CENTRAL STATUTORY TRUST II
STORM LAKE IA
Managing Memb Owns 100
CENTRAL FLORIDA REAL ESTATE OWNED LLC
STORM LAKE IA
er
Results A list of branches for your holding company COMMERC1ALflNANCJALCORP (1978574) of STORM IAKE IA The data are as of 12312014 Data reflects lnfo1maton that was received and processd through Ol07 2015
Reconcl1alon md Vertncaloo SICli 1 Jn the Data Action column of each branch row enter one or more of the actions specified below 2 If required enter the date In the Effective Date column
Actions OK If the branch Information Is correct enterOK In the Data Action coumn
Change tr the branch Information Is Incorrect or Incomplete revise the data enterOrnnge In the Data Action colllmn and the date when this Information rlrstbecame vaJd In the Effective Dale column Close If a branch lsted was sold or closed enter Clos In the Data Actlori column and the sale or closure date In the Effective Date coumn Delete ]f a branch Med was never owned by this depository Institution enter Odele In the Data Action column Add Jf a reportable branch Is missing Insert a row add the branch data and enterAdd In the Data Action column and the opening or acqulsltfon date In theEHectlve Date column
If printing this Hsi you may need to adjust your pa Be setup In MS Excel Try uslng landscape orientation page scaling andor e(lal siled paper
Submission Procedure When you are finished send a saved copy to your FRB contact See the detailed Instructions on this site for more Information If you are e-malllng th ls to your FRB contact put your Institution name dty and state In the subject tine of the emiddotmall
Note To sltitislythe FR YmiddotlO reporting requirements you must aim submit FR YmiddotlO Domestic Branch Schedules for each branch with a Data Action of Q1ange dose Delete or Add The FR Y-10 report may be submitted In a hardcopy format or via the FR YmiddotlO Onlne applcatlon bull httpsylOonUnefederalreservegov
bull FOCUNINUM Office Number and D_RSSD columns are for reference only Verlflcatron of these values ls not required
Data Action Effective Date Branch Service Type Branch ID RSSDbull Popular Name Street Address City
OK Full Service Head Office) 545544 CENTRAL BANK 600 LAKE AVENUE STORM lAKE OK Full Service 4154B52 ANKENY BOULEVARD BRANCH 2805 NORTH ANKENY BOULEVARD ANKENY
OK Umlted Servke 2116588 CHEROKEE BRANCH 2BOW DRIVE CHEROKEE
OK Full Service 802848 CHEROKEE CENTRAL TRUST BRANCH 401 WEST MAIN STREET CHEROKEE
OK Full Service 2161147 4018 UNIVERSITY AVENUEOFFJCE 4018 UNIVERSITY AVENUE DES MOINES
OK Full Service 4155104 HUBBEL AVENUE BRANCH 2742 HUBBELLAVENUE DES MOINES
OK Full Service 4155270 WALNUT STREETS RANCH 700 WALNUT STREET DES MOINES
OK Full Service 4493169 4201 SOUTH LAKEPORT BRANCH 4201 SOUTH LAKEPORT SIOUX CITY
OK FuI Service 3078064 522 fOURTH STREET BRANCH 522 4TH STREET SIOUX CITY
OK Full Service 3596719 stoux OiY BRANCH 2-906 HAMILTON BLVD SIOUX CITY
OK Full Servke 810142 SPIRIT IAKE BRANCH 1400 1BTH STREET SPIRIT LAKE
OK limited Service 2045050 DRIVEmiddotIN BRANCH 1237 LAKE AVENUE STORM LAKE
OK Full Servke 4155252 URBANDALE BRANCH 3800 lOOTH STREET URBANDALE
OK Full Service 44931SO 6501 WESTOWN PARKWAY BRANCH 6601 WESTOWN PARKWAYSUITE140 WEST DES MOINES
OK Full Service 4639444 ASHWORTH ROAD BRANCH 6139 ASHWORTH ROAD WEST DES MOINES OK Full Service 4155131 MILLS ClVJCPARr-NAY BRANCH 5070 MILLS CIVIC PARKWAY WEST DES MOINES
State Zip Code County IA 505BS BUENA VISTA IA 50023 POLK IA 51012 CHEROKEE IA 51012 CHEROKEE IA 50311 POLK
IA 50317 POLK IA 50309 POLK IA 51106 WOODBURY
IA 51101 WOODBURY
IA 51104 WOODBURY IA Sl360 DICKINSON IA 505BBmiddot19 BUENA VISTA IA 50322 POLK IA S0266 POLK IA 50266 POLK IA 50265 POLK
Country FDICUNINUM+ Office Numberbull Head Offlce Head Office ID RSSDbull Comments UNITED STATES 9849 0 CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544 UNITED STATES 263121 6 CENTRAL BANK 546544 UNITED STATES 6467 3 CENTRAL BANK 545544 UNITED STATES Not Requred Not Required CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544
UNITED STATES Not Required Not Required CENTRAL BANK 546S44 UNITED STATES Not Required Nol Required CENTRAL BANK S46544 UNITED STATES 362876 7 CENTRAL BANK S45544 UNITED STATES 465474 9 CENTRAL BANK S46544
UNITED STATES 9695 8 CENTRAL BANK 546544
UNITED STATES 234537 l CENTRAL BANK 546S44 UNITED STATES Not Required Not Required CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544
UNITED STATES Not Required Not Requred CENTRAL BANK 546544
UNITED STATES Nol Required Not Required CENTRAL BANK 546544
Report Item 4 - Brincipal Shareholders Director Executive Officer ofBaMlHolding Company
1 (1) Name and adhress middoti
(2) Principal oc4Lation if other than with Miaing company
(3) Title or posltion with 1 I (a) Bank ho)g company
I j
(b) See Atta9ped I ( c) Other busfuess companies
l TossLLC Toss IT1f-LC
i Imiddot ( 4) Number of sliitres and percentage
of voting sedrities owned middot controlled oJ eldwith power to vote ii (a) Barik holtlmg company -1
Clas Common Class Common (Nobivoting)
i I (b) Subsidiaries of bank
h ld ti 0 mgmiddot1rmpany
i (c) Otherbusillfss companies
I
TossLic Meser units
Toss II ILLC Member units
I
Timothy J Brown Storm Lake Iowa
NIA
President and Director
Member Member
5009 Shares 5967
1296 Shares 9460
None
1667
1667
John C Brown Spirit Lake Iowa
NIA
Secretary Treasurer and Director
Member Member
3385 Shares 4033
44 Shares 321
None
1667
1667
r
Report Item 4 - Rrincipal Shareholders Director Executive Officer of BanhlEolding Company
middotI
(3) Title or p9itiori with middotI I
bull1 (b) Subsidiaes of
holding 1qompany
Central Bank I I
middot1 ti
Jvlilford Holtljitgs Inc I
i
I
I
middotl 1 i
i
Timothy J Brown Storm Lake Iowa
President and Director
President and Director
John C Brown Spirit Lake Iowa
Executive ViceshyPresident Secretary and Director
Executive ViceshyPtesident Secretary and Director
- FR Y-6 Cover Page
- For Use By Tiered Holding Companies
- Report Item 1 Annual Report to Shareholders
- Report Item 2a Organization Chart
- Report Item 2b Domestic Branch Listing
- Report Item 3 Securities Holders
- Report Item 4 Insiders
-
bull bull COMMERCIAL FINANCIAL CORP
(PARENT COMPANY ONLY)
bull STATEMENTS OF CASH FLOWS Years Ended December 31 2014 and 2013
bull bull 2014 2013
bull CASH FLOWS FROM OPERATING ACTIVITIES Net income $ 9783824 $ 2394 197
bull Adjustments to reconcile net income to net cash used in operating activities
bull Equity in earnings of subsidiaries (10001319) (2824716) Losses on other assets 3618 3980
bull Effects of changes in operating assets and liabilities Due to and from subsidiaries (1304582) 1596002
bull Other (14949) Income tax receivable 1394565 (1368384) bull Notes receivable - related parties (2513) 4353
bull Deferred income taxes 17756 Accrued interest receivable (2798) 1391
bull Accrued interest payable 919 (209)
bull Net cash used in operating activities (125479) (193386)
bull CASH FLOWS FROM INVESTING ACTIVITIES Dividends received from subsidiaries 2500000 1250000
bull Loans receivable - participation (2000000) Investment in limited liability company (9382) (650724)
bull Other 2000 1500
bull Net cash provided by investing activities 492618 600776
bull CASH FLOWS FROM FINANCING ACTIVITIES Dividends paid to stockholders (406755) (465000)
bull Proceeds from issuance of Class B common stock 101471 95243
bull Payment to redeem Class B common stock (95243) (81431)
Net cash provided by financing activities (400527) (451 188)
bull NET DECREASE IN CASH (33388) (43798) bull
bull CASH BEGINNING OF YEAR 514943 558741
bull CASH END OF YEAR $ 481555 $ 514943
bull SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
bull Cash paid for interest was $165561 in 2014 and $169 187 in 2013 Cash received for income taxes was $219000 in 2014 and $435 170 in 2013
bull SUPPLEMENTAL DISCLOSURE OF NONCASH FINANCING ACTIVITIES Dividends declared on Senior Preferred stock of $45000 in 2014
bull is included in liabilities
bull bull
6
bull
bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull
COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Commercial Financial Corp (the Company) is an Iowa-based bank holding company At December 31 2014 the Company owns 100 of the voting common stock of Central Bank headquartered in Storm Lake Iowa During 2014 Lakes Bancorporation Inc was merged into Central Bank thereby increasing the Companys direct ownership in Central Bank to 100 Previously the Company owned 65 of Central Bank and 100 of Lakes Bancorporation which owned 35 of Central Bank Central Bank owns 100 of the common stock of Milford Holdings Inc and 100 of the membership interest in Real Estate Owned LLC and Central Florida Real Estate Owned LLC The Company also owns 100 of the common stock of Central Statutory Trust II (Central Statutory Trust)
The principal market areas for the Company and its subsidiaries are Storm Lake Cherokee Spirit Lake Sioux City Des Moines and the surrounding Iowa communities
The Companys subsidiaries make commercial agricultural real estate and installment loans to businesses and individuals as well as maintaining deposits for customers in their market areas
Use of Estimates in Preparing Financial Statements
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period Actual results could vary from those estimates
Investments in Subsidiaries
Accounting standards require the consolidation of majority-owned subsidiaries with the parent for financial reporting purposes Commercial Financial Corps wholly-owned subsidiaries Central Bank and Central Statutory Trust are included in the accompanying financial statements under the equity method rather than consolidated with the Company (See Note 6)
The accompanying financial statements are not intended to replace any consolidated financial statements of Commercial Financial Corp and subsidiaries
NOTE 2 - GROUP CONCENTRATION OF CREDIT RISK
The Companys primary business activity is with Central Bank in Storm Lake Cherokee Spirit Lake Des Moines and Sioux City Iowa The Bank makes commercial agricultural real estate and installment loans to customers in the Storm Lake Cherokee Spirit Lake Des Moines and Sioux City Iowa areas Although the Bank has a diversified loan portfolio a substantial portion of its debtors ability to honor their contracts is dependent upon the agricultural economy
7
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 3 - SUBORDINATED DEBENTURES PAYABLE TO NONBANK SUBSIDIARY
Subordinated debentures payable to nonbank subsidiary at December 31 2014 and 2013 represents indebtedness to Central Statutory Trust II and bears interest at a rate equal to the 3-month LIBOR rate plus 175 At December 31 2014 and 2013 the interest rate was 199 and 199 respectively The principal amounts of the debentures are due June 21 2037
NOTE 4 - INCOME TAXES
The Company and its subsidiaries file consolidated federal and State of Iowa income tax return The subsidiaries provide for income taxes on a separate return basis and remit to the Company amounts determined to be currently payable
The Company follows the accounting requirements for uncertain tax positions The Company determined that no liability related to uncertain tax positions was required as of December 31 2014 and 2013
The federal and state income tax returns of the Company for 2011 and thereafter are subject to examination by the IRS and state taxing authorities generally for three years after they were filed
NOTE 5 - RESTRICTIONS ON SUBSIDIARY DIVIDENDS
The ability of the Company to service its debt is dependent on cash dividends paid to the Company by its subsidiary bank The Bank is a state chartered bank that is also a member of a federal reserve bank The subsidiary bank is subject to certain statutory and regulatory restrictions on the amount it may pay in dividends
A state bank that is registered as a federal reserve bank may not pay a dividend which would impair the capital of the bank A federal reserve member bank is required to obtain prior approval of the Board of Governors of the Federal Reserve System if the total of all dividends including the proposed dividends declared by the bank in any calendar year exceeds the total of the banks net profits of that year combined with its retained net profits of the preceding two years In addition a bank chartered under Iowa law may pay dividends up to the amount of its undivided profits provided its surplus account equals or exceeds its capital account subject to maintenance of minimum capital requirements
8
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 6 - SUBSIDIARY CONDENSED FINANCIAL STATEMENTS
The following is a summary of selected unaudited financial information of Central Bank based upon the December 31 2014 and 2013 financial statements submitted to the Federal Deposit Insurance Corporation
2014 2013
Total assets $ 655686000 $ 651573000
Liabilities $ 588121000 $ 591764000 Stockholders equity 67565000 59809000
Total liabilities and stockholders equity $ 655686000 $ 651573000
Net income $ 10001000 $ 2825000
During 2014 Lakes Bancorporation Inc was merged into Central Bank In connection with the merger the Company recognized $911572 in excess of cost over net assets of subsidiaries (goodwill) which had been previously recognized by Lakes Bancorporation Inc The following is a summary of selected unaudited parent company only financial information of Lakes Bancorporation based on December 31 2013 parent company only financial statements filed with the Federal Reserve System
2013
Total assets $ 21 916000
Liabilities $ Stockholders equity 21 916000
Total liabilities and stockholders equity $ 21 916000
Net income $ 989000
Central Bank owns 100 of the common stock of Milford Holdings Inc The following is a summary of selected unaudited financial information of Milford Holdings Inc
2014 2013
Total assets $ 7660000 $ 7022000
Liabilities $ 31000 $ Stockholders equity 7629000 7022000
Total liabilities and stockholders equity $ 7660000 $ 7022000
Net income $ 607000 $ 370000
9
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 6 - SUBSIDIARY CONDENSED FINANCIAL STATEMENTS (CONTINUED)
During 2013 Central Bank acquired 100 of the membership interest in Real Estate Owned LLC The following is a summary of selected unaudited financial information of Real Estate Owned LLC
2014 2013
Total assets $ 4508000 $ 3456000
Liabilities $ 17000 $ Stockholders equity 4491000 3456000
Total liabilities and stockholders equity $ 4508000 $ 3456000
Net income $ 206000 $
During 2013 Central Bank acquired 100 of the membership interest in Central Florida Real Estate Owned LLC The following is a summary of selected unaudited financial information of Central Florida Real Estate Owned LLC
Total assets
Liabilities Stockholders equity
Total liabilities and stockholders equity
Net income
$
$
$
$
2014 2013
744000 $ 1476000
$ 744000 1476000
744000 $ 1476000
140000 $
The Company owns 100 of the trust common securities of Central Statutory Trust II Central Statutory Trust II was formed to issue Company obligated mandatorily redeemable preferred securities (Preferred Securities) Central Statutory Trust II has issued all of the 8000000 authorized shares of preferred securities The preferred securities are considered liabilities on the balance sheet for Central Statutory Trust II For regulatory purposes a portion of the preferred securities are allowed in the calculation of Tier 1 and Tier 2 capital of the Company
10
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 6 - SUBSIDIARY CONDENSED FINANCIAL STATEMENTS (CONTINUED)
The following is a summary of selected unaudited financial information of Central Statutory Trust II based on December 31 2014 and 2013 quarterly financial statements of nonbank subsidiaries filed with the Federal Reserve System
2014 2013
Total assets $ 8248000 $ 8248000
Liabilities $ 8000000 $ 8000000 Stockholders equity 248000 248000
Total liabilities and stockholders equity $ 8248000 $ 8248000
Net income $ $
NOTE 7 - SENIOR PREFERRED STOCK
The Company executed a Small Business Lending Fund Securities Purchase Agreement with the United States Department of the Treasury (Treasury) effective September 20 2011 Through the Small Business Lending Fund (SBLF) the Treasury provides Tier 1 capital to community banks and other eligible institutions Each institution pays dividend rates that go down as its small business lending goes up
Treasury was issued 18000 shares of Senior Non-Cumulative Perpetual Preferred Stock Series A for $18000000 on September 20 2011 The initial dividend rate was 5 The variable dividend rate may decrease each of the following nine quarters based on the increase in qualified small business lending as defined in the agreement The dividend rate will vary between 1 and 5 as lending increases vary between 10 and 25 The fixed dividend rate for the tenth quarter after funding through the end of the first four and one-half years is set as described above if lending has increased at the end of the eighth quarter after funding If lending has not increased at the end of the eighth quarter after funding the fixed dividend rate is set at 7 The fixed dividend rate after four and one-half years is set at 9 if the funding has not already been repaid The dividend rate at December 31 2014 and 2013 was 1 for both years
The Treasury has a liquidation preference of $1000 per share or $18000000 as of December 31 2014 Dividends are payable quarterly in arrears on January 1 April 1 July 1 and October 1 of each year Dividends payable at December 31 2014 and 2013 are $45000 and $0 respectively The Company may repay the funding at any time with regulatory approval
11
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 8 - ACCUMULATED OTHER COMPREHENSIVE INCOME
Central Bank and Milford Holdings Inc maintain certain securities in an available-for-sale category At December 31 2014 and 2013 combined accumulated other comprehensive income related to available-for-sale securities in the amount of $111415 and $172428 respectively was recorded directly to the Companys stockholders equity for its 100 proportionate share of the other comprehensive income
NOTE 9 - SUBSEQUENT EVENTS
Management evaluated subsequent events through March 6 2015 the date the financial statements were available to be issued Events or transactions occurring after December 31 2014 but prior to March 6 2015 that provided additional evidence about conditions that existed at December 31 2014 have been recognized in the financial statements for the year ended December 31 2014 Events or transactions that provided evidence about conditions that did not exist at December 31 2014 but arose before the financial statements were available to be issued have not been recognized in the financial statements for the year ended December 31 2014
See accountants compilation report
12
COMMERCIAL FINANCIAL CORP
Report - rem J Commercial Fuianc1al Corp is not required to file with the Secunt1es and
Exchange Comfriiksion r bull 1 R
eport
Item 111 Fmancial statenints parent company only of Commercial Fmancial Corp middotI
are attached Cppsolidated financial statements are not prepared h 1 I I fb m t e norma colirtse o usmess
Report-Item 2J U Organizational Chart middot See attabhed chart
Report- Item 2J k Banch Verification l Ii See attced chart
Report-Item 3 l middot middot Listing of sharehfders that directly or indirectly own control or hold with power to v9t 5 or more of any class of shares of the bank holding Company middotmiddotj
gt ll I
Name andAddrJJs J Timothy J Brovampn 1 Storm Lake IoWa I
i
John C Brown f 1 Spirit Lake IovM
1 f - (
Citizenship
1JSA
USA
Report Item 4 -se Schedule Attached
t
l H
il
Class A Common
Shares Owned
5009
3385
Percentage
5967
4033
Class B Common
Shares Owned
1296
44
Percentage
9460
321
ORGANIZATIONAL CHART
Report - Item 2(a) - Organization chart - Commercial Financial Corp Incorporated State of Iowa - Lakes Bancorporation Inc Incorporated State of Iowa - Central Bank Incorporated State of Iowa - Milford Holdings Inc Incorporated State of Iowa - Central Statutory Trust II Deleware Statutory Trust - Real Estate Owned LLC lncorprated State of Iowa - Central Florida Real Estate Owned LLC Incorporated State of Florida - Toss II LLC Incorporated State of Iowa
COMMERCIAL FINANCIAL CORP STORM LAKE IA
Non-Managing M Owns 40
ember
Toss II LLC Stonn Lake IA
Footnotes
Owns 65
CENTRAL BANK
STORM LAKE IA
Owns 100
MILFORD HOLDINGS INC STORM LAKE IA
(See footnote 1)
Lakes Bancorporation Inc
Stonn Lake IA
Owns 35
Managing Member Owns 100
REAL ESTATE OWNED LLC
STORM LAKE IA
1 Commercial Financial Corp owns 5540000 (100) of the outstanding shares of voting common stock
Owns 100
CENTRAL STATUTORY TRUST II
STORM LAKE IA
Managing Memb Owns 100
CENTRAL FLORIDA REAL ESTATE OWNED LLC
STORM LAKE IA
er
Results A list of branches for your holding company COMMERC1ALflNANCJALCORP (1978574) of STORM IAKE IA The data are as of 12312014 Data reflects lnfo1maton that was received and processd through Ol07 2015
Reconcl1alon md Vertncaloo SICli 1 Jn the Data Action column of each branch row enter one or more of the actions specified below 2 If required enter the date In the Effective Date column
Actions OK If the branch Information Is correct enterOK In the Data Action coumn
Change tr the branch Information Is Incorrect or Incomplete revise the data enterOrnnge In the Data Action colllmn and the date when this Information rlrstbecame vaJd In the Effective Dale column Close If a branch lsted was sold or closed enter Clos In the Data Actlori column and the sale or closure date In the Effective Date coumn Delete ]f a branch Med was never owned by this depository Institution enter Odele In the Data Action column Add Jf a reportable branch Is missing Insert a row add the branch data and enterAdd In the Data Action column and the opening or acqulsltfon date In theEHectlve Date column
If printing this Hsi you may need to adjust your pa Be setup In MS Excel Try uslng landscape orientation page scaling andor e(lal siled paper
Submission Procedure When you are finished send a saved copy to your FRB contact See the detailed Instructions on this site for more Information If you are e-malllng th ls to your FRB contact put your Institution name dty and state In the subject tine of the emiddotmall
Note To sltitislythe FR YmiddotlO reporting requirements you must aim submit FR YmiddotlO Domestic Branch Schedules for each branch with a Data Action of Q1ange dose Delete or Add The FR Y-10 report may be submitted In a hardcopy format or via the FR YmiddotlO Onlne applcatlon bull httpsylOonUnefederalreservegov
bull FOCUNINUM Office Number and D_RSSD columns are for reference only Verlflcatron of these values ls not required
Data Action Effective Date Branch Service Type Branch ID RSSDbull Popular Name Street Address City
OK Full Service Head Office) 545544 CENTRAL BANK 600 LAKE AVENUE STORM lAKE OK Full Service 4154B52 ANKENY BOULEVARD BRANCH 2805 NORTH ANKENY BOULEVARD ANKENY
OK Umlted Servke 2116588 CHEROKEE BRANCH 2BOW DRIVE CHEROKEE
OK Full Service 802848 CHEROKEE CENTRAL TRUST BRANCH 401 WEST MAIN STREET CHEROKEE
OK Full Service 2161147 4018 UNIVERSITY AVENUEOFFJCE 4018 UNIVERSITY AVENUE DES MOINES
OK Full Service 4155104 HUBBEL AVENUE BRANCH 2742 HUBBELLAVENUE DES MOINES
OK Full Service 4155270 WALNUT STREETS RANCH 700 WALNUT STREET DES MOINES
OK Full Service 4493169 4201 SOUTH LAKEPORT BRANCH 4201 SOUTH LAKEPORT SIOUX CITY
OK FuI Service 3078064 522 fOURTH STREET BRANCH 522 4TH STREET SIOUX CITY
OK Full Service 3596719 stoux OiY BRANCH 2-906 HAMILTON BLVD SIOUX CITY
OK Full Servke 810142 SPIRIT IAKE BRANCH 1400 1BTH STREET SPIRIT LAKE
OK limited Service 2045050 DRIVEmiddotIN BRANCH 1237 LAKE AVENUE STORM LAKE
OK Full Servke 4155252 URBANDALE BRANCH 3800 lOOTH STREET URBANDALE
OK Full Service 44931SO 6501 WESTOWN PARKWAY BRANCH 6601 WESTOWN PARKWAYSUITE140 WEST DES MOINES
OK Full Service 4639444 ASHWORTH ROAD BRANCH 6139 ASHWORTH ROAD WEST DES MOINES OK Full Service 4155131 MILLS ClVJCPARr-NAY BRANCH 5070 MILLS CIVIC PARKWAY WEST DES MOINES
State Zip Code County IA 505BS BUENA VISTA IA 50023 POLK IA 51012 CHEROKEE IA 51012 CHEROKEE IA 50311 POLK
IA 50317 POLK IA 50309 POLK IA 51106 WOODBURY
IA 51101 WOODBURY
IA 51104 WOODBURY IA Sl360 DICKINSON IA 505BBmiddot19 BUENA VISTA IA 50322 POLK IA S0266 POLK IA 50266 POLK IA 50265 POLK
Country FDICUNINUM+ Office Numberbull Head Offlce Head Office ID RSSDbull Comments UNITED STATES 9849 0 CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544 UNITED STATES 263121 6 CENTRAL BANK 546544 UNITED STATES 6467 3 CENTRAL BANK 545544 UNITED STATES Not Requred Not Required CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544
UNITED STATES Not Required Not Required CENTRAL BANK 546S44 UNITED STATES Not Required Nol Required CENTRAL BANK S46544 UNITED STATES 362876 7 CENTRAL BANK S45544 UNITED STATES 465474 9 CENTRAL BANK S46544
UNITED STATES 9695 8 CENTRAL BANK 546544
UNITED STATES 234537 l CENTRAL BANK 546S44 UNITED STATES Not Required Not Required CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544
UNITED STATES Not Required Not Requred CENTRAL BANK 546544
UNITED STATES Nol Required Not Required CENTRAL BANK 546544
Report Item 4 - Brincipal Shareholders Director Executive Officer ofBaMlHolding Company
1 (1) Name and adhress middoti
(2) Principal oc4Lation if other than with Miaing company
(3) Title or posltion with 1 I (a) Bank ho)g company
I j
(b) See Atta9ped I ( c) Other busfuess companies
l TossLLC Toss IT1f-LC
i Imiddot ( 4) Number of sliitres and percentage
of voting sedrities owned middot controlled oJ eldwith power to vote ii (a) Barik holtlmg company -1
Clas Common Class Common (Nobivoting)
i I (b) Subsidiaries of bank
h ld ti 0 mgmiddot1rmpany
i (c) Otherbusillfss companies
I
TossLic Meser units
Toss II ILLC Member units
I
Timothy J Brown Storm Lake Iowa
NIA
President and Director
Member Member
5009 Shares 5967
1296 Shares 9460
None
1667
1667
John C Brown Spirit Lake Iowa
NIA
Secretary Treasurer and Director
Member Member
3385 Shares 4033
44 Shares 321
None
1667
1667
r
Report Item 4 - Rrincipal Shareholders Director Executive Officer of BanhlEolding Company
middotI
(3) Title or p9itiori with middotI I
bull1 (b) Subsidiaes of
holding 1qompany
Central Bank I I
middot1 ti
Jvlilford Holtljitgs Inc I
i
I
I
middotl 1 i
i
Timothy J Brown Storm Lake Iowa
President and Director
President and Director
John C Brown Spirit Lake Iowa
Executive ViceshyPresident Secretary and Director
Executive ViceshyPtesident Secretary and Director
- FR Y-6 Cover Page
- For Use By Tiered Holding Companies
- Report Item 1 Annual Report to Shareholders
- Report Item 2a Organization Chart
- Report Item 2b Domestic Branch Listing
- Report Item 3 Securities Holders
- Report Item 4 Insiders
-
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Commercial Financial Corp (the Company) is an Iowa-based bank holding company At December 31 2014 the Company owns 100 of the voting common stock of Central Bank headquartered in Storm Lake Iowa During 2014 Lakes Bancorporation Inc was merged into Central Bank thereby increasing the Companys direct ownership in Central Bank to 100 Previously the Company owned 65 of Central Bank and 100 of Lakes Bancorporation which owned 35 of Central Bank Central Bank owns 100 of the common stock of Milford Holdings Inc and 100 of the membership interest in Real Estate Owned LLC and Central Florida Real Estate Owned LLC The Company also owns 100 of the common stock of Central Statutory Trust II (Central Statutory Trust)
The principal market areas for the Company and its subsidiaries are Storm Lake Cherokee Spirit Lake Sioux City Des Moines and the surrounding Iowa communities
The Companys subsidiaries make commercial agricultural real estate and installment loans to businesses and individuals as well as maintaining deposits for customers in their market areas
Use of Estimates in Preparing Financial Statements
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period Actual results could vary from those estimates
Investments in Subsidiaries
Accounting standards require the consolidation of majority-owned subsidiaries with the parent for financial reporting purposes Commercial Financial Corps wholly-owned subsidiaries Central Bank and Central Statutory Trust are included in the accompanying financial statements under the equity method rather than consolidated with the Company (See Note 6)
The accompanying financial statements are not intended to replace any consolidated financial statements of Commercial Financial Corp and subsidiaries
NOTE 2 - GROUP CONCENTRATION OF CREDIT RISK
The Companys primary business activity is with Central Bank in Storm Lake Cherokee Spirit Lake Des Moines and Sioux City Iowa The Bank makes commercial agricultural real estate and installment loans to customers in the Storm Lake Cherokee Spirit Lake Des Moines and Sioux City Iowa areas Although the Bank has a diversified loan portfolio a substantial portion of its debtors ability to honor their contracts is dependent upon the agricultural economy
7
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 3 - SUBORDINATED DEBENTURES PAYABLE TO NONBANK SUBSIDIARY
Subordinated debentures payable to nonbank subsidiary at December 31 2014 and 2013 represents indebtedness to Central Statutory Trust II and bears interest at a rate equal to the 3-month LIBOR rate plus 175 At December 31 2014 and 2013 the interest rate was 199 and 199 respectively The principal amounts of the debentures are due June 21 2037
NOTE 4 - INCOME TAXES
The Company and its subsidiaries file consolidated federal and State of Iowa income tax return The subsidiaries provide for income taxes on a separate return basis and remit to the Company amounts determined to be currently payable
The Company follows the accounting requirements for uncertain tax positions The Company determined that no liability related to uncertain tax positions was required as of December 31 2014 and 2013
The federal and state income tax returns of the Company for 2011 and thereafter are subject to examination by the IRS and state taxing authorities generally for three years after they were filed
NOTE 5 - RESTRICTIONS ON SUBSIDIARY DIVIDENDS
The ability of the Company to service its debt is dependent on cash dividends paid to the Company by its subsidiary bank The Bank is a state chartered bank that is also a member of a federal reserve bank The subsidiary bank is subject to certain statutory and regulatory restrictions on the amount it may pay in dividends
A state bank that is registered as a federal reserve bank may not pay a dividend which would impair the capital of the bank A federal reserve member bank is required to obtain prior approval of the Board of Governors of the Federal Reserve System if the total of all dividends including the proposed dividends declared by the bank in any calendar year exceeds the total of the banks net profits of that year combined with its retained net profits of the preceding two years In addition a bank chartered under Iowa law may pay dividends up to the amount of its undivided profits provided its surplus account equals or exceeds its capital account subject to maintenance of minimum capital requirements
8
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 6 - SUBSIDIARY CONDENSED FINANCIAL STATEMENTS
The following is a summary of selected unaudited financial information of Central Bank based upon the December 31 2014 and 2013 financial statements submitted to the Federal Deposit Insurance Corporation
2014 2013
Total assets $ 655686000 $ 651573000
Liabilities $ 588121000 $ 591764000 Stockholders equity 67565000 59809000
Total liabilities and stockholders equity $ 655686000 $ 651573000
Net income $ 10001000 $ 2825000
During 2014 Lakes Bancorporation Inc was merged into Central Bank In connection with the merger the Company recognized $911572 in excess of cost over net assets of subsidiaries (goodwill) which had been previously recognized by Lakes Bancorporation Inc The following is a summary of selected unaudited parent company only financial information of Lakes Bancorporation based on December 31 2013 parent company only financial statements filed with the Federal Reserve System
2013
Total assets $ 21 916000
Liabilities $ Stockholders equity 21 916000
Total liabilities and stockholders equity $ 21 916000
Net income $ 989000
Central Bank owns 100 of the common stock of Milford Holdings Inc The following is a summary of selected unaudited financial information of Milford Holdings Inc
2014 2013
Total assets $ 7660000 $ 7022000
Liabilities $ 31000 $ Stockholders equity 7629000 7022000
Total liabilities and stockholders equity $ 7660000 $ 7022000
Net income $ 607000 $ 370000
9
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 6 - SUBSIDIARY CONDENSED FINANCIAL STATEMENTS (CONTINUED)
During 2013 Central Bank acquired 100 of the membership interest in Real Estate Owned LLC The following is a summary of selected unaudited financial information of Real Estate Owned LLC
2014 2013
Total assets $ 4508000 $ 3456000
Liabilities $ 17000 $ Stockholders equity 4491000 3456000
Total liabilities and stockholders equity $ 4508000 $ 3456000
Net income $ 206000 $
During 2013 Central Bank acquired 100 of the membership interest in Central Florida Real Estate Owned LLC The following is a summary of selected unaudited financial information of Central Florida Real Estate Owned LLC
Total assets
Liabilities Stockholders equity
Total liabilities and stockholders equity
Net income
$
$
$
$
2014 2013
744000 $ 1476000
$ 744000 1476000
744000 $ 1476000
140000 $
The Company owns 100 of the trust common securities of Central Statutory Trust II Central Statutory Trust II was formed to issue Company obligated mandatorily redeemable preferred securities (Preferred Securities) Central Statutory Trust II has issued all of the 8000000 authorized shares of preferred securities The preferred securities are considered liabilities on the balance sheet for Central Statutory Trust II For regulatory purposes a portion of the preferred securities are allowed in the calculation of Tier 1 and Tier 2 capital of the Company
10
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 6 - SUBSIDIARY CONDENSED FINANCIAL STATEMENTS (CONTINUED)
The following is a summary of selected unaudited financial information of Central Statutory Trust II based on December 31 2014 and 2013 quarterly financial statements of nonbank subsidiaries filed with the Federal Reserve System
2014 2013
Total assets $ 8248000 $ 8248000
Liabilities $ 8000000 $ 8000000 Stockholders equity 248000 248000
Total liabilities and stockholders equity $ 8248000 $ 8248000
Net income $ $
NOTE 7 - SENIOR PREFERRED STOCK
The Company executed a Small Business Lending Fund Securities Purchase Agreement with the United States Department of the Treasury (Treasury) effective September 20 2011 Through the Small Business Lending Fund (SBLF) the Treasury provides Tier 1 capital to community banks and other eligible institutions Each institution pays dividend rates that go down as its small business lending goes up
Treasury was issued 18000 shares of Senior Non-Cumulative Perpetual Preferred Stock Series A for $18000000 on September 20 2011 The initial dividend rate was 5 The variable dividend rate may decrease each of the following nine quarters based on the increase in qualified small business lending as defined in the agreement The dividend rate will vary between 1 and 5 as lending increases vary between 10 and 25 The fixed dividend rate for the tenth quarter after funding through the end of the first four and one-half years is set as described above if lending has increased at the end of the eighth quarter after funding If lending has not increased at the end of the eighth quarter after funding the fixed dividend rate is set at 7 The fixed dividend rate after four and one-half years is set at 9 if the funding has not already been repaid The dividend rate at December 31 2014 and 2013 was 1 for both years
The Treasury has a liquidation preference of $1000 per share or $18000000 as of December 31 2014 Dividends are payable quarterly in arrears on January 1 April 1 July 1 and October 1 of each year Dividends payable at December 31 2014 and 2013 are $45000 and $0 respectively The Company may repay the funding at any time with regulatory approval
11
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 8 - ACCUMULATED OTHER COMPREHENSIVE INCOME
Central Bank and Milford Holdings Inc maintain certain securities in an available-for-sale category At December 31 2014 and 2013 combined accumulated other comprehensive income related to available-for-sale securities in the amount of $111415 and $172428 respectively was recorded directly to the Companys stockholders equity for its 100 proportionate share of the other comprehensive income
NOTE 9 - SUBSEQUENT EVENTS
Management evaluated subsequent events through March 6 2015 the date the financial statements were available to be issued Events or transactions occurring after December 31 2014 but prior to March 6 2015 that provided additional evidence about conditions that existed at December 31 2014 have been recognized in the financial statements for the year ended December 31 2014 Events or transactions that provided evidence about conditions that did not exist at December 31 2014 but arose before the financial statements were available to be issued have not been recognized in the financial statements for the year ended December 31 2014
See accountants compilation report
12
COMMERCIAL FINANCIAL CORP
Report - rem J Commercial Fuianc1al Corp is not required to file with the Secunt1es and
Exchange Comfriiksion r bull 1 R
eport
Item 111 Fmancial statenints parent company only of Commercial Fmancial Corp middotI
are attached Cppsolidated financial statements are not prepared h 1 I I fb m t e norma colirtse o usmess
Report-Item 2J U Organizational Chart middot See attabhed chart
Report- Item 2J k Banch Verification l Ii See attced chart
Report-Item 3 l middot middot Listing of sharehfders that directly or indirectly own control or hold with power to v9t 5 or more of any class of shares of the bank holding Company middotmiddotj
gt ll I
Name andAddrJJs J Timothy J Brovampn 1 Storm Lake IoWa I
i
John C Brown f 1 Spirit Lake IovM
1 f - (
Citizenship
1JSA
USA
Report Item 4 -se Schedule Attached
t
l H
il
Class A Common
Shares Owned
5009
3385
Percentage
5967
4033
Class B Common
Shares Owned
1296
44
Percentage
9460
321
ORGANIZATIONAL CHART
Report - Item 2(a) - Organization chart - Commercial Financial Corp Incorporated State of Iowa - Lakes Bancorporation Inc Incorporated State of Iowa - Central Bank Incorporated State of Iowa - Milford Holdings Inc Incorporated State of Iowa - Central Statutory Trust II Deleware Statutory Trust - Real Estate Owned LLC lncorprated State of Iowa - Central Florida Real Estate Owned LLC Incorporated State of Florida - Toss II LLC Incorporated State of Iowa
COMMERCIAL FINANCIAL CORP STORM LAKE IA
Non-Managing M Owns 40
ember
Toss II LLC Stonn Lake IA
Footnotes
Owns 65
CENTRAL BANK
STORM LAKE IA
Owns 100
MILFORD HOLDINGS INC STORM LAKE IA
(See footnote 1)
Lakes Bancorporation Inc
Stonn Lake IA
Owns 35
Managing Member Owns 100
REAL ESTATE OWNED LLC
STORM LAKE IA
1 Commercial Financial Corp owns 5540000 (100) of the outstanding shares of voting common stock
Owns 100
CENTRAL STATUTORY TRUST II
STORM LAKE IA
Managing Memb Owns 100
CENTRAL FLORIDA REAL ESTATE OWNED LLC
STORM LAKE IA
er
Results A list of branches for your holding company COMMERC1ALflNANCJALCORP (1978574) of STORM IAKE IA The data are as of 12312014 Data reflects lnfo1maton that was received and processd through Ol07 2015
Reconcl1alon md Vertncaloo SICli 1 Jn the Data Action column of each branch row enter one or more of the actions specified below 2 If required enter the date In the Effective Date column
Actions OK If the branch Information Is correct enterOK In the Data Action coumn
Change tr the branch Information Is Incorrect or Incomplete revise the data enterOrnnge In the Data Action colllmn and the date when this Information rlrstbecame vaJd In the Effective Dale column Close If a branch lsted was sold or closed enter Clos In the Data Actlori column and the sale or closure date In the Effective Date coumn Delete ]f a branch Med was never owned by this depository Institution enter Odele In the Data Action column Add Jf a reportable branch Is missing Insert a row add the branch data and enterAdd In the Data Action column and the opening or acqulsltfon date In theEHectlve Date column
If printing this Hsi you may need to adjust your pa Be setup In MS Excel Try uslng landscape orientation page scaling andor e(lal siled paper
Submission Procedure When you are finished send a saved copy to your FRB contact See the detailed Instructions on this site for more Information If you are e-malllng th ls to your FRB contact put your Institution name dty and state In the subject tine of the emiddotmall
Note To sltitislythe FR YmiddotlO reporting requirements you must aim submit FR YmiddotlO Domestic Branch Schedules for each branch with a Data Action of Q1ange dose Delete or Add The FR Y-10 report may be submitted In a hardcopy format or via the FR YmiddotlO Onlne applcatlon bull httpsylOonUnefederalreservegov
bull FOCUNINUM Office Number and D_RSSD columns are for reference only Verlflcatron of these values ls not required
Data Action Effective Date Branch Service Type Branch ID RSSDbull Popular Name Street Address City
OK Full Service Head Office) 545544 CENTRAL BANK 600 LAKE AVENUE STORM lAKE OK Full Service 4154B52 ANKENY BOULEVARD BRANCH 2805 NORTH ANKENY BOULEVARD ANKENY
OK Umlted Servke 2116588 CHEROKEE BRANCH 2BOW DRIVE CHEROKEE
OK Full Service 802848 CHEROKEE CENTRAL TRUST BRANCH 401 WEST MAIN STREET CHEROKEE
OK Full Service 2161147 4018 UNIVERSITY AVENUEOFFJCE 4018 UNIVERSITY AVENUE DES MOINES
OK Full Service 4155104 HUBBEL AVENUE BRANCH 2742 HUBBELLAVENUE DES MOINES
OK Full Service 4155270 WALNUT STREETS RANCH 700 WALNUT STREET DES MOINES
OK Full Service 4493169 4201 SOUTH LAKEPORT BRANCH 4201 SOUTH LAKEPORT SIOUX CITY
OK FuI Service 3078064 522 fOURTH STREET BRANCH 522 4TH STREET SIOUX CITY
OK Full Service 3596719 stoux OiY BRANCH 2-906 HAMILTON BLVD SIOUX CITY
OK Full Servke 810142 SPIRIT IAKE BRANCH 1400 1BTH STREET SPIRIT LAKE
OK limited Service 2045050 DRIVEmiddotIN BRANCH 1237 LAKE AVENUE STORM LAKE
OK Full Servke 4155252 URBANDALE BRANCH 3800 lOOTH STREET URBANDALE
OK Full Service 44931SO 6501 WESTOWN PARKWAY BRANCH 6601 WESTOWN PARKWAYSUITE140 WEST DES MOINES
OK Full Service 4639444 ASHWORTH ROAD BRANCH 6139 ASHWORTH ROAD WEST DES MOINES OK Full Service 4155131 MILLS ClVJCPARr-NAY BRANCH 5070 MILLS CIVIC PARKWAY WEST DES MOINES
State Zip Code County IA 505BS BUENA VISTA IA 50023 POLK IA 51012 CHEROKEE IA 51012 CHEROKEE IA 50311 POLK
IA 50317 POLK IA 50309 POLK IA 51106 WOODBURY
IA 51101 WOODBURY
IA 51104 WOODBURY IA Sl360 DICKINSON IA 505BBmiddot19 BUENA VISTA IA 50322 POLK IA S0266 POLK IA 50266 POLK IA 50265 POLK
Country FDICUNINUM+ Office Numberbull Head Offlce Head Office ID RSSDbull Comments UNITED STATES 9849 0 CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544 UNITED STATES 263121 6 CENTRAL BANK 546544 UNITED STATES 6467 3 CENTRAL BANK 545544 UNITED STATES Not Requred Not Required CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544
UNITED STATES Not Required Not Required CENTRAL BANK 546S44 UNITED STATES Not Required Nol Required CENTRAL BANK S46544 UNITED STATES 362876 7 CENTRAL BANK S45544 UNITED STATES 465474 9 CENTRAL BANK S46544
UNITED STATES 9695 8 CENTRAL BANK 546544
UNITED STATES 234537 l CENTRAL BANK 546S44 UNITED STATES Not Required Not Required CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544
UNITED STATES Not Required Not Requred CENTRAL BANK 546544
UNITED STATES Nol Required Not Required CENTRAL BANK 546544
Report Item 4 - Brincipal Shareholders Director Executive Officer ofBaMlHolding Company
1 (1) Name and adhress middoti
(2) Principal oc4Lation if other than with Miaing company
(3) Title or posltion with 1 I (a) Bank ho)g company
I j
(b) See Atta9ped I ( c) Other busfuess companies
l TossLLC Toss IT1f-LC
i Imiddot ( 4) Number of sliitres and percentage
of voting sedrities owned middot controlled oJ eldwith power to vote ii (a) Barik holtlmg company -1
Clas Common Class Common (Nobivoting)
i I (b) Subsidiaries of bank
h ld ti 0 mgmiddot1rmpany
i (c) Otherbusillfss companies
I
TossLic Meser units
Toss II ILLC Member units
I
Timothy J Brown Storm Lake Iowa
NIA
President and Director
Member Member
5009 Shares 5967
1296 Shares 9460
None
1667
1667
John C Brown Spirit Lake Iowa
NIA
Secretary Treasurer and Director
Member Member
3385 Shares 4033
44 Shares 321
None
1667
1667
r
Report Item 4 - Rrincipal Shareholders Director Executive Officer of BanhlEolding Company
middotI
(3) Title or p9itiori with middotI I
bull1 (b) Subsidiaes of
holding 1qompany
Central Bank I I
middot1 ti
Jvlilford Holtljitgs Inc I
i
I
I
middotl 1 i
i
Timothy J Brown Storm Lake Iowa
President and Director
President and Director
John C Brown Spirit Lake Iowa
Executive ViceshyPresident Secretary and Director
Executive ViceshyPtesident Secretary and Director
- FR Y-6 Cover Page
- For Use By Tiered Holding Companies
- Report Item 1 Annual Report to Shareholders
- Report Item 2a Organization Chart
- Report Item 2b Domestic Branch Listing
- Report Item 3 Securities Holders
- Report Item 4 Insiders
-
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COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 3 - SUBORDINATED DEBENTURES PAYABLE TO NONBANK SUBSIDIARY
Subordinated debentures payable to nonbank subsidiary at December 31 2014 and 2013 represents indebtedness to Central Statutory Trust II and bears interest at a rate equal to the 3-month LIBOR rate plus 175 At December 31 2014 and 2013 the interest rate was 199 and 199 respectively The principal amounts of the debentures are due June 21 2037
NOTE 4 - INCOME TAXES
The Company and its subsidiaries file consolidated federal and State of Iowa income tax return The subsidiaries provide for income taxes on a separate return basis and remit to the Company amounts determined to be currently payable
The Company follows the accounting requirements for uncertain tax positions The Company determined that no liability related to uncertain tax positions was required as of December 31 2014 and 2013
The federal and state income tax returns of the Company for 2011 and thereafter are subject to examination by the IRS and state taxing authorities generally for three years after they were filed
NOTE 5 - RESTRICTIONS ON SUBSIDIARY DIVIDENDS
The ability of the Company to service its debt is dependent on cash dividends paid to the Company by its subsidiary bank The Bank is a state chartered bank that is also a member of a federal reserve bank The subsidiary bank is subject to certain statutory and regulatory restrictions on the amount it may pay in dividends
A state bank that is registered as a federal reserve bank may not pay a dividend which would impair the capital of the bank A federal reserve member bank is required to obtain prior approval of the Board of Governors of the Federal Reserve System if the total of all dividends including the proposed dividends declared by the bank in any calendar year exceeds the total of the banks net profits of that year combined with its retained net profits of the preceding two years In addition a bank chartered under Iowa law may pay dividends up to the amount of its undivided profits provided its surplus account equals or exceeds its capital account subject to maintenance of minimum capital requirements
8
bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull
COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 6 - SUBSIDIARY CONDENSED FINANCIAL STATEMENTS
The following is a summary of selected unaudited financial information of Central Bank based upon the December 31 2014 and 2013 financial statements submitted to the Federal Deposit Insurance Corporation
2014 2013
Total assets $ 655686000 $ 651573000
Liabilities $ 588121000 $ 591764000 Stockholders equity 67565000 59809000
Total liabilities and stockholders equity $ 655686000 $ 651573000
Net income $ 10001000 $ 2825000
During 2014 Lakes Bancorporation Inc was merged into Central Bank In connection with the merger the Company recognized $911572 in excess of cost over net assets of subsidiaries (goodwill) which had been previously recognized by Lakes Bancorporation Inc The following is a summary of selected unaudited parent company only financial information of Lakes Bancorporation based on December 31 2013 parent company only financial statements filed with the Federal Reserve System
2013
Total assets $ 21 916000
Liabilities $ Stockholders equity 21 916000
Total liabilities and stockholders equity $ 21 916000
Net income $ 989000
Central Bank owns 100 of the common stock of Milford Holdings Inc The following is a summary of selected unaudited financial information of Milford Holdings Inc
2014 2013
Total assets $ 7660000 $ 7022000
Liabilities $ 31000 $ Stockholders equity 7629000 7022000
Total liabilities and stockholders equity $ 7660000 $ 7022000
Net income $ 607000 $ 370000
9
bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull
COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 6 - SUBSIDIARY CONDENSED FINANCIAL STATEMENTS (CONTINUED)
During 2013 Central Bank acquired 100 of the membership interest in Real Estate Owned LLC The following is a summary of selected unaudited financial information of Real Estate Owned LLC
2014 2013
Total assets $ 4508000 $ 3456000
Liabilities $ 17000 $ Stockholders equity 4491000 3456000
Total liabilities and stockholders equity $ 4508000 $ 3456000
Net income $ 206000 $
During 2013 Central Bank acquired 100 of the membership interest in Central Florida Real Estate Owned LLC The following is a summary of selected unaudited financial information of Central Florida Real Estate Owned LLC
Total assets
Liabilities Stockholders equity
Total liabilities and stockholders equity
Net income
$
$
$
$
2014 2013
744000 $ 1476000
$ 744000 1476000
744000 $ 1476000
140000 $
The Company owns 100 of the trust common securities of Central Statutory Trust II Central Statutory Trust II was formed to issue Company obligated mandatorily redeemable preferred securities (Preferred Securities) Central Statutory Trust II has issued all of the 8000000 authorized shares of preferred securities The preferred securities are considered liabilities on the balance sheet for Central Statutory Trust II For regulatory purposes a portion of the preferred securities are allowed in the calculation of Tier 1 and Tier 2 capital of the Company
10
bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull
COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 6 - SUBSIDIARY CONDENSED FINANCIAL STATEMENTS (CONTINUED)
The following is a summary of selected unaudited financial information of Central Statutory Trust II based on December 31 2014 and 2013 quarterly financial statements of nonbank subsidiaries filed with the Federal Reserve System
2014 2013
Total assets $ 8248000 $ 8248000
Liabilities $ 8000000 $ 8000000 Stockholders equity 248000 248000
Total liabilities and stockholders equity $ 8248000 $ 8248000
Net income $ $
NOTE 7 - SENIOR PREFERRED STOCK
The Company executed a Small Business Lending Fund Securities Purchase Agreement with the United States Department of the Treasury (Treasury) effective September 20 2011 Through the Small Business Lending Fund (SBLF) the Treasury provides Tier 1 capital to community banks and other eligible institutions Each institution pays dividend rates that go down as its small business lending goes up
Treasury was issued 18000 shares of Senior Non-Cumulative Perpetual Preferred Stock Series A for $18000000 on September 20 2011 The initial dividend rate was 5 The variable dividend rate may decrease each of the following nine quarters based on the increase in qualified small business lending as defined in the agreement The dividend rate will vary between 1 and 5 as lending increases vary between 10 and 25 The fixed dividend rate for the tenth quarter after funding through the end of the first four and one-half years is set as described above if lending has increased at the end of the eighth quarter after funding If lending has not increased at the end of the eighth quarter after funding the fixed dividend rate is set at 7 The fixed dividend rate after four and one-half years is set at 9 if the funding has not already been repaid The dividend rate at December 31 2014 and 2013 was 1 for both years
The Treasury has a liquidation preference of $1000 per share or $18000000 as of December 31 2014 Dividends are payable quarterly in arrears on January 1 April 1 July 1 and October 1 of each year Dividends payable at December 31 2014 and 2013 are $45000 and $0 respectively The Company may repay the funding at any time with regulatory approval
11
bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull
COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 8 - ACCUMULATED OTHER COMPREHENSIVE INCOME
Central Bank and Milford Holdings Inc maintain certain securities in an available-for-sale category At December 31 2014 and 2013 combined accumulated other comprehensive income related to available-for-sale securities in the amount of $111415 and $172428 respectively was recorded directly to the Companys stockholders equity for its 100 proportionate share of the other comprehensive income
NOTE 9 - SUBSEQUENT EVENTS
Management evaluated subsequent events through March 6 2015 the date the financial statements were available to be issued Events or transactions occurring after December 31 2014 but prior to March 6 2015 that provided additional evidence about conditions that existed at December 31 2014 have been recognized in the financial statements for the year ended December 31 2014 Events or transactions that provided evidence about conditions that did not exist at December 31 2014 but arose before the financial statements were available to be issued have not been recognized in the financial statements for the year ended December 31 2014
See accountants compilation report
12
COMMERCIAL FINANCIAL CORP
Report - rem J Commercial Fuianc1al Corp is not required to file with the Secunt1es and
Exchange Comfriiksion r bull 1 R
eport
Item 111 Fmancial statenints parent company only of Commercial Fmancial Corp middotI
are attached Cppsolidated financial statements are not prepared h 1 I I fb m t e norma colirtse o usmess
Report-Item 2J U Organizational Chart middot See attabhed chart
Report- Item 2J k Banch Verification l Ii See attced chart
Report-Item 3 l middot middot Listing of sharehfders that directly or indirectly own control or hold with power to v9t 5 or more of any class of shares of the bank holding Company middotmiddotj
gt ll I
Name andAddrJJs J Timothy J Brovampn 1 Storm Lake IoWa I
i
John C Brown f 1 Spirit Lake IovM
1 f - (
Citizenship
1JSA
USA
Report Item 4 -se Schedule Attached
t
l H
il
Class A Common
Shares Owned
5009
3385
Percentage
5967
4033
Class B Common
Shares Owned
1296
44
Percentage
9460
321
ORGANIZATIONAL CHART
Report - Item 2(a) - Organization chart - Commercial Financial Corp Incorporated State of Iowa - Lakes Bancorporation Inc Incorporated State of Iowa - Central Bank Incorporated State of Iowa - Milford Holdings Inc Incorporated State of Iowa - Central Statutory Trust II Deleware Statutory Trust - Real Estate Owned LLC lncorprated State of Iowa - Central Florida Real Estate Owned LLC Incorporated State of Florida - Toss II LLC Incorporated State of Iowa
COMMERCIAL FINANCIAL CORP STORM LAKE IA
Non-Managing M Owns 40
ember
Toss II LLC Stonn Lake IA
Footnotes
Owns 65
CENTRAL BANK
STORM LAKE IA
Owns 100
MILFORD HOLDINGS INC STORM LAKE IA
(See footnote 1)
Lakes Bancorporation Inc
Stonn Lake IA
Owns 35
Managing Member Owns 100
REAL ESTATE OWNED LLC
STORM LAKE IA
1 Commercial Financial Corp owns 5540000 (100) of the outstanding shares of voting common stock
Owns 100
CENTRAL STATUTORY TRUST II
STORM LAKE IA
Managing Memb Owns 100
CENTRAL FLORIDA REAL ESTATE OWNED LLC
STORM LAKE IA
er
Results A list of branches for your holding company COMMERC1ALflNANCJALCORP (1978574) of STORM IAKE IA The data are as of 12312014 Data reflects lnfo1maton that was received and processd through Ol07 2015
Reconcl1alon md Vertncaloo SICli 1 Jn the Data Action column of each branch row enter one or more of the actions specified below 2 If required enter the date In the Effective Date column
Actions OK If the branch Information Is correct enterOK In the Data Action coumn
Change tr the branch Information Is Incorrect or Incomplete revise the data enterOrnnge In the Data Action colllmn and the date when this Information rlrstbecame vaJd In the Effective Dale column Close If a branch lsted was sold or closed enter Clos In the Data Actlori column and the sale or closure date In the Effective Date coumn Delete ]f a branch Med was never owned by this depository Institution enter Odele In the Data Action column Add Jf a reportable branch Is missing Insert a row add the branch data and enterAdd In the Data Action column and the opening or acqulsltfon date In theEHectlve Date column
If printing this Hsi you may need to adjust your pa Be setup In MS Excel Try uslng landscape orientation page scaling andor e(lal siled paper
Submission Procedure When you are finished send a saved copy to your FRB contact See the detailed Instructions on this site for more Information If you are e-malllng th ls to your FRB contact put your Institution name dty and state In the subject tine of the emiddotmall
Note To sltitislythe FR YmiddotlO reporting requirements you must aim submit FR YmiddotlO Domestic Branch Schedules for each branch with a Data Action of Q1ange dose Delete or Add The FR Y-10 report may be submitted In a hardcopy format or via the FR YmiddotlO Onlne applcatlon bull httpsylOonUnefederalreservegov
bull FOCUNINUM Office Number and D_RSSD columns are for reference only Verlflcatron of these values ls not required
Data Action Effective Date Branch Service Type Branch ID RSSDbull Popular Name Street Address City
OK Full Service Head Office) 545544 CENTRAL BANK 600 LAKE AVENUE STORM lAKE OK Full Service 4154B52 ANKENY BOULEVARD BRANCH 2805 NORTH ANKENY BOULEVARD ANKENY
OK Umlted Servke 2116588 CHEROKEE BRANCH 2BOW DRIVE CHEROKEE
OK Full Service 802848 CHEROKEE CENTRAL TRUST BRANCH 401 WEST MAIN STREET CHEROKEE
OK Full Service 2161147 4018 UNIVERSITY AVENUEOFFJCE 4018 UNIVERSITY AVENUE DES MOINES
OK Full Service 4155104 HUBBEL AVENUE BRANCH 2742 HUBBELLAVENUE DES MOINES
OK Full Service 4155270 WALNUT STREETS RANCH 700 WALNUT STREET DES MOINES
OK Full Service 4493169 4201 SOUTH LAKEPORT BRANCH 4201 SOUTH LAKEPORT SIOUX CITY
OK FuI Service 3078064 522 fOURTH STREET BRANCH 522 4TH STREET SIOUX CITY
OK Full Service 3596719 stoux OiY BRANCH 2-906 HAMILTON BLVD SIOUX CITY
OK Full Servke 810142 SPIRIT IAKE BRANCH 1400 1BTH STREET SPIRIT LAKE
OK limited Service 2045050 DRIVEmiddotIN BRANCH 1237 LAKE AVENUE STORM LAKE
OK Full Servke 4155252 URBANDALE BRANCH 3800 lOOTH STREET URBANDALE
OK Full Service 44931SO 6501 WESTOWN PARKWAY BRANCH 6601 WESTOWN PARKWAYSUITE140 WEST DES MOINES
OK Full Service 4639444 ASHWORTH ROAD BRANCH 6139 ASHWORTH ROAD WEST DES MOINES OK Full Service 4155131 MILLS ClVJCPARr-NAY BRANCH 5070 MILLS CIVIC PARKWAY WEST DES MOINES
State Zip Code County IA 505BS BUENA VISTA IA 50023 POLK IA 51012 CHEROKEE IA 51012 CHEROKEE IA 50311 POLK
IA 50317 POLK IA 50309 POLK IA 51106 WOODBURY
IA 51101 WOODBURY
IA 51104 WOODBURY IA Sl360 DICKINSON IA 505BBmiddot19 BUENA VISTA IA 50322 POLK IA S0266 POLK IA 50266 POLK IA 50265 POLK
Country FDICUNINUM+ Office Numberbull Head Offlce Head Office ID RSSDbull Comments UNITED STATES 9849 0 CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544 UNITED STATES 263121 6 CENTRAL BANK 546544 UNITED STATES 6467 3 CENTRAL BANK 545544 UNITED STATES Not Requred Not Required CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544
UNITED STATES Not Required Not Required CENTRAL BANK 546S44 UNITED STATES Not Required Nol Required CENTRAL BANK S46544 UNITED STATES 362876 7 CENTRAL BANK S45544 UNITED STATES 465474 9 CENTRAL BANK S46544
UNITED STATES 9695 8 CENTRAL BANK 546544
UNITED STATES 234537 l CENTRAL BANK 546S44 UNITED STATES Not Required Not Required CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544
UNITED STATES Not Required Not Requred CENTRAL BANK 546544
UNITED STATES Nol Required Not Required CENTRAL BANK 546544
Report Item 4 - Brincipal Shareholders Director Executive Officer ofBaMlHolding Company
1 (1) Name and adhress middoti
(2) Principal oc4Lation if other than with Miaing company
(3) Title or posltion with 1 I (a) Bank ho)g company
I j
(b) See Atta9ped I ( c) Other busfuess companies
l TossLLC Toss IT1f-LC
i Imiddot ( 4) Number of sliitres and percentage
of voting sedrities owned middot controlled oJ eldwith power to vote ii (a) Barik holtlmg company -1
Clas Common Class Common (Nobivoting)
i I (b) Subsidiaries of bank
h ld ti 0 mgmiddot1rmpany
i (c) Otherbusillfss companies
I
TossLic Meser units
Toss II ILLC Member units
I
Timothy J Brown Storm Lake Iowa
NIA
President and Director
Member Member
5009 Shares 5967
1296 Shares 9460
None
1667
1667
John C Brown Spirit Lake Iowa
NIA
Secretary Treasurer and Director
Member Member
3385 Shares 4033
44 Shares 321
None
1667
1667
r
Report Item 4 - Rrincipal Shareholders Director Executive Officer of BanhlEolding Company
middotI
(3) Title or p9itiori with middotI I
bull1 (b) Subsidiaes of
holding 1qompany
Central Bank I I
middot1 ti
Jvlilford Holtljitgs Inc I
i
I
I
middotl 1 i
i
Timothy J Brown Storm Lake Iowa
President and Director
President and Director
John C Brown Spirit Lake Iowa
Executive ViceshyPresident Secretary and Director
Executive ViceshyPtesident Secretary and Director
- FR Y-6 Cover Page
- For Use By Tiered Holding Companies
- Report Item 1 Annual Report to Shareholders
- Report Item 2a Organization Chart
- Report Item 2b Domestic Branch Listing
- Report Item 3 Securities Holders
- Report Item 4 Insiders
-
bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull
COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 6 - SUBSIDIARY CONDENSED FINANCIAL STATEMENTS
The following is a summary of selected unaudited financial information of Central Bank based upon the December 31 2014 and 2013 financial statements submitted to the Federal Deposit Insurance Corporation
2014 2013
Total assets $ 655686000 $ 651573000
Liabilities $ 588121000 $ 591764000 Stockholders equity 67565000 59809000
Total liabilities and stockholders equity $ 655686000 $ 651573000
Net income $ 10001000 $ 2825000
During 2014 Lakes Bancorporation Inc was merged into Central Bank In connection with the merger the Company recognized $911572 in excess of cost over net assets of subsidiaries (goodwill) which had been previously recognized by Lakes Bancorporation Inc The following is a summary of selected unaudited parent company only financial information of Lakes Bancorporation based on December 31 2013 parent company only financial statements filed with the Federal Reserve System
2013
Total assets $ 21 916000
Liabilities $ Stockholders equity 21 916000
Total liabilities and stockholders equity $ 21 916000
Net income $ 989000
Central Bank owns 100 of the common stock of Milford Holdings Inc The following is a summary of selected unaudited financial information of Milford Holdings Inc
2014 2013
Total assets $ 7660000 $ 7022000
Liabilities $ 31000 $ Stockholders equity 7629000 7022000
Total liabilities and stockholders equity $ 7660000 $ 7022000
Net income $ 607000 $ 370000
9
bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull
COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 6 - SUBSIDIARY CONDENSED FINANCIAL STATEMENTS (CONTINUED)
During 2013 Central Bank acquired 100 of the membership interest in Real Estate Owned LLC The following is a summary of selected unaudited financial information of Real Estate Owned LLC
2014 2013
Total assets $ 4508000 $ 3456000
Liabilities $ 17000 $ Stockholders equity 4491000 3456000
Total liabilities and stockholders equity $ 4508000 $ 3456000
Net income $ 206000 $
During 2013 Central Bank acquired 100 of the membership interest in Central Florida Real Estate Owned LLC The following is a summary of selected unaudited financial information of Central Florida Real Estate Owned LLC
Total assets
Liabilities Stockholders equity
Total liabilities and stockholders equity
Net income
$
$
$
$
2014 2013
744000 $ 1476000
$ 744000 1476000
744000 $ 1476000
140000 $
The Company owns 100 of the trust common securities of Central Statutory Trust II Central Statutory Trust II was formed to issue Company obligated mandatorily redeemable preferred securities (Preferred Securities) Central Statutory Trust II has issued all of the 8000000 authorized shares of preferred securities The preferred securities are considered liabilities on the balance sheet for Central Statutory Trust II For regulatory purposes a portion of the preferred securities are allowed in the calculation of Tier 1 and Tier 2 capital of the Company
10
bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull
COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 6 - SUBSIDIARY CONDENSED FINANCIAL STATEMENTS (CONTINUED)
The following is a summary of selected unaudited financial information of Central Statutory Trust II based on December 31 2014 and 2013 quarterly financial statements of nonbank subsidiaries filed with the Federal Reserve System
2014 2013
Total assets $ 8248000 $ 8248000
Liabilities $ 8000000 $ 8000000 Stockholders equity 248000 248000
Total liabilities and stockholders equity $ 8248000 $ 8248000
Net income $ $
NOTE 7 - SENIOR PREFERRED STOCK
The Company executed a Small Business Lending Fund Securities Purchase Agreement with the United States Department of the Treasury (Treasury) effective September 20 2011 Through the Small Business Lending Fund (SBLF) the Treasury provides Tier 1 capital to community banks and other eligible institutions Each institution pays dividend rates that go down as its small business lending goes up
Treasury was issued 18000 shares of Senior Non-Cumulative Perpetual Preferred Stock Series A for $18000000 on September 20 2011 The initial dividend rate was 5 The variable dividend rate may decrease each of the following nine quarters based on the increase in qualified small business lending as defined in the agreement The dividend rate will vary between 1 and 5 as lending increases vary between 10 and 25 The fixed dividend rate for the tenth quarter after funding through the end of the first four and one-half years is set as described above if lending has increased at the end of the eighth quarter after funding If lending has not increased at the end of the eighth quarter after funding the fixed dividend rate is set at 7 The fixed dividend rate after four and one-half years is set at 9 if the funding has not already been repaid The dividend rate at December 31 2014 and 2013 was 1 for both years
The Treasury has a liquidation preference of $1000 per share or $18000000 as of December 31 2014 Dividends are payable quarterly in arrears on January 1 April 1 July 1 and October 1 of each year Dividends payable at December 31 2014 and 2013 are $45000 and $0 respectively The Company may repay the funding at any time with regulatory approval
11
bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull
COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 8 - ACCUMULATED OTHER COMPREHENSIVE INCOME
Central Bank and Milford Holdings Inc maintain certain securities in an available-for-sale category At December 31 2014 and 2013 combined accumulated other comprehensive income related to available-for-sale securities in the amount of $111415 and $172428 respectively was recorded directly to the Companys stockholders equity for its 100 proportionate share of the other comprehensive income
NOTE 9 - SUBSEQUENT EVENTS
Management evaluated subsequent events through March 6 2015 the date the financial statements were available to be issued Events or transactions occurring after December 31 2014 but prior to March 6 2015 that provided additional evidence about conditions that existed at December 31 2014 have been recognized in the financial statements for the year ended December 31 2014 Events or transactions that provided evidence about conditions that did not exist at December 31 2014 but arose before the financial statements were available to be issued have not been recognized in the financial statements for the year ended December 31 2014
See accountants compilation report
12
COMMERCIAL FINANCIAL CORP
Report - rem J Commercial Fuianc1al Corp is not required to file with the Secunt1es and
Exchange Comfriiksion r bull 1 R
eport
Item 111 Fmancial statenints parent company only of Commercial Fmancial Corp middotI
are attached Cppsolidated financial statements are not prepared h 1 I I fb m t e norma colirtse o usmess
Report-Item 2J U Organizational Chart middot See attabhed chart
Report- Item 2J k Banch Verification l Ii See attced chart
Report-Item 3 l middot middot Listing of sharehfders that directly or indirectly own control or hold with power to v9t 5 or more of any class of shares of the bank holding Company middotmiddotj
gt ll I
Name andAddrJJs J Timothy J Brovampn 1 Storm Lake IoWa I
i
John C Brown f 1 Spirit Lake IovM
1 f - (
Citizenship
1JSA
USA
Report Item 4 -se Schedule Attached
t
l H
il
Class A Common
Shares Owned
5009
3385
Percentage
5967
4033
Class B Common
Shares Owned
1296
44
Percentage
9460
321
ORGANIZATIONAL CHART
Report - Item 2(a) - Organization chart - Commercial Financial Corp Incorporated State of Iowa - Lakes Bancorporation Inc Incorporated State of Iowa - Central Bank Incorporated State of Iowa - Milford Holdings Inc Incorporated State of Iowa - Central Statutory Trust II Deleware Statutory Trust - Real Estate Owned LLC lncorprated State of Iowa - Central Florida Real Estate Owned LLC Incorporated State of Florida - Toss II LLC Incorporated State of Iowa
COMMERCIAL FINANCIAL CORP STORM LAKE IA
Non-Managing M Owns 40
ember
Toss II LLC Stonn Lake IA
Footnotes
Owns 65
CENTRAL BANK
STORM LAKE IA
Owns 100
MILFORD HOLDINGS INC STORM LAKE IA
(See footnote 1)
Lakes Bancorporation Inc
Stonn Lake IA
Owns 35
Managing Member Owns 100
REAL ESTATE OWNED LLC
STORM LAKE IA
1 Commercial Financial Corp owns 5540000 (100) of the outstanding shares of voting common stock
Owns 100
CENTRAL STATUTORY TRUST II
STORM LAKE IA
Managing Memb Owns 100
CENTRAL FLORIDA REAL ESTATE OWNED LLC
STORM LAKE IA
er
Results A list of branches for your holding company COMMERC1ALflNANCJALCORP (1978574) of STORM IAKE IA The data are as of 12312014 Data reflects lnfo1maton that was received and processd through Ol07 2015
Reconcl1alon md Vertncaloo SICli 1 Jn the Data Action column of each branch row enter one or more of the actions specified below 2 If required enter the date In the Effective Date column
Actions OK If the branch Information Is correct enterOK In the Data Action coumn
Change tr the branch Information Is Incorrect or Incomplete revise the data enterOrnnge In the Data Action colllmn and the date when this Information rlrstbecame vaJd In the Effective Dale column Close If a branch lsted was sold or closed enter Clos In the Data Actlori column and the sale or closure date In the Effective Date coumn Delete ]f a branch Med was never owned by this depository Institution enter Odele In the Data Action column Add Jf a reportable branch Is missing Insert a row add the branch data and enterAdd In the Data Action column and the opening or acqulsltfon date In theEHectlve Date column
If printing this Hsi you may need to adjust your pa Be setup In MS Excel Try uslng landscape orientation page scaling andor e(lal siled paper
Submission Procedure When you are finished send a saved copy to your FRB contact See the detailed Instructions on this site for more Information If you are e-malllng th ls to your FRB contact put your Institution name dty and state In the subject tine of the emiddotmall
Note To sltitislythe FR YmiddotlO reporting requirements you must aim submit FR YmiddotlO Domestic Branch Schedules for each branch with a Data Action of Q1ange dose Delete or Add The FR Y-10 report may be submitted In a hardcopy format or via the FR YmiddotlO Onlne applcatlon bull httpsylOonUnefederalreservegov
bull FOCUNINUM Office Number and D_RSSD columns are for reference only Verlflcatron of these values ls not required
Data Action Effective Date Branch Service Type Branch ID RSSDbull Popular Name Street Address City
OK Full Service Head Office) 545544 CENTRAL BANK 600 LAKE AVENUE STORM lAKE OK Full Service 4154B52 ANKENY BOULEVARD BRANCH 2805 NORTH ANKENY BOULEVARD ANKENY
OK Umlted Servke 2116588 CHEROKEE BRANCH 2BOW DRIVE CHEROKEE
OK Full Service 802848 CHEROKEE CENTRAL TRUST BRANCH 401 WEST MAIN STREET CHEROKEE
OK Full Service 2161147 4018 UNIVERSITY AVENUEOFFJCE 4018 UNIVERSITY AVENUE DES MOINES
OK Full Service 4155104 HUBBEL AVENUE BRANCH 2742 HUBBELLAVENUE DES MOINES
OK Full Service 4155270 WALNUT STREETS RANCH 700 WALNUT STREET DES MOINES
OK Full Service 4493169 4201 SOUTH LAKEPORT BRANCH 4201 SOUTH LAKEPORT SIOUX CITY
OK FuI Service 3078064 522 fOURTH STREET BRANCH 522 4TH STREET SIOUX CITY
OK Full Service 3596719 stoux OiY BRANCH 2-906 HAMILTON BLVD SIOUX CITY
OK Full Servke 810142 SPIRIT IAKE BRANCH 1400 1BTH STREET SPIRIT LAKE
OK limited Service 2045050 DRIVEmiddotIN BRANCH 1237 LAKE AVENUE STORM LAKE
OK Full Servke 4155252 URBANDALE BRANCH 3800 lOOTH STREET URBANDALE
OK Full Service 44931SO 6501 WESTOWN PARKWAY BRANCH 6601 WESTOWN PARKWAYSUITE140 WEST DES MOINES
OK Full Service 4639444 ASHWORTH ROAD BRANCH 6139 ASHWORTH ROAD WEST DES MOINES OK Full Service 4155131 MILLS ClVJCPARr-NAY BRANCH 5070 MILLS CIVIC PARKWAY WEST DES MOINES
State Zip Code County IA 505BS BUENA VISTA IA 50023 POLK IA 51012 CHEROKEE IA 51012 CHEROKEE IA 50311 POLK
IA 50317 POLK IA 50309 POLK IA 51106 WOODBURY
IA 51101 WOODBURY
IA 51104 WOODBURY IA Sl360 DICKINSON IA 505BBmiddot19 BUENA VISTA IA 50322 POLK IA S0266 POLK IA 50266 POLK IA 50265 POLK
Country FDICUNINUM+ Office Numberbull Head Offlce Head Office ID RSSDbull Comments UNITED STATES 9849 0 CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544 UNITED STATES 263121 6 CENTRAL BANK 546544 UNITED STATES 6467 3 CENTRAL BANK 545544 UNITED STATES Not Requred Not Required CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544
UNITED STATES Not Required Not Required CENTRAL BANK 546S44 UNITED STATES Not Required Nol Required CENTRAL BANK S46544 UNITED STATES 362876 7 CENTRAL BANK S45544 UNITED STATES 465474 9 CENTRAL BANK S46544
UNITED STATES 9695 8 CENTRAL BANK 546544
UNITED STATES 234537 l CENTRAL BANK 546S44 UNITED STATES Not Required Not Required CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544
UNITED STATES Not Required Not Requred CENTRAL BANK 546544
UNITED STATES Nol Required Not Required CENTRAL BANK 546544
Report Item 4 - Brincipal Shareholders Director Executive Officer ofBaMlHolding Company
1 (1) Name and adhress middoti
(2) Principal oc4Lation if other than with Miaing company
(3) Title or posltion with 1 I (a) Bank ho)g company
I j
(b) See Atta9ped I ( c) Other busfuess companies
l TossLLC Toss IT1f-LC
i Imiddot ( 4) Number of sliitres and percentage
of voting sedrities owned middot controlled oJ eldwith power to vote ii (a) Barik holtlmg company -1
Clas Common Class Common (Nobivoting)
i I (b) Subsidiaries of bank
h ld ti 0 mgmiddot1rmpany
i (c) Otherbusillfss companies
I
TossLic Meser units
Toss II ILLC Member units
I
Timothy J Brown Storm Lake Iowa
NIA
President and Director
Member Member
5009 Shares 5967
1296 Shares 9460
None
1667
1667
John C Brown Spirit Lake Iowa
NIA
Secretary Treasurer and Director
Member Member
3385 Shares 4033
44 Shares 321
None
1667
1667
r
Report Item 4 - Rrincipal Shareholders Director Executive Officer of BanhlEolding Company
middotI
(3) Title or p9itiori with middotI I
bull1 (b) Subsidiaes of
holding 1qompany
Central Bank I I
middot1 ti
Jvlilford Holtljitgs Inc I
i
I
I
middotl 1 i
i
Timothy J Brown Storm Lake Iowa
President and Director
President and Director
John C Brown Spirit Lake Iowa
Executive ViceshyPresident Secretary and Director
Executive ViceshyPtesident Secretary and Director
- FR Y-6 Cover Page
- For Use By Tiered Holding Companies
- Report Item 1 Annual Report to Shareholders
- Report Item 2a Organization Chart
- Report Item 2b Domestic Branch Listing
- Report Item 3 Securities Holders
- Report Item 4 Insiders
-
bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull
COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 6 - SUBSIDIARY CONDENSED FINANCIAL STATEMENTS (CONTINUED)
During 2013 Central Bank acquired 100 of the membership interest in Real Estate Owned LLC The following is a summary of selected unaudited financial information of Real Estate Owned LLC
2014 2013
Total assets $ 4508000 $ 3456000
Liabilities $ 17000 $ Stockholders equity 4491000 3456000
Total liabilities and stockholders equity $ 4508000 $ 3456000
Net income $ 206000 $
During 2013 Central Bank acquired 100 of the membership interest in Central Florida Real Estate Owned LLC The following is a summary of selected unaudited financial information of Central Florida Real Estate Owned LLC
Total assets
Liabilities Stockholders equity
Total liabilities and stockholders equity
Net income
$
$
$
$
2014 2013
744000 $ 1476000
$ 744000 1476000
744000 $ 1476000
140000 $
The Company owns 100 of the trust common securities of Central Statutory Trust II Central Statutory Trust II was formed to issue Company obligated mandatorily redeemable preferred securities (Preferred Securities) Central Statutory Trust II has issued all of the 8000000 authorized shares of preferred securities The preferred securities are considered liabilities on the balance sheet for Central Statutory Trust II For regulatory purposes a portion of the preferred securities are allowed in the calculation of Tier 1 and Tier 2 capital of the Company
10
bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull
COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 6 - SUBSIDIARY CONDENSED FINANCIAL STATEMENTS (CONTINUED)
The following is a summary of selected unaudited financial information of Central Statutory Trust II based on December 31 2014 and 2013 quarterly financial statements of nonbank subsidiaries filed with the Federal Reserve System
2014 2013
Total assets $ 8248000 $ 8248000
Liabilities $ 8000000 $ 8000000 Stockholders equity 248000 248000
Total liabilities and stockholders equity $ 8248000 $ 8248000
Net income $ $
NOTE 7 - SENIOR PREFERRED STOCK
The Company executed a Small Business Lending Fund Securities Purchase Agreement with the United States Department of the Treasury (Treasury) effective September 20 2011 Through the Small Business Lending Fund (SBLF) the Treasury provides Tier 1 capital to community banks and other eligible institutions Each institution pays dividend rates that go down as its small business lending goes up
Treasury was issued 18000 shares of Senior Non-Cumulative Perpetual Preferred Stock Series A for $18000000 on September 20 2011 The initial dividend rate was 5 The variable dividend rate may decrease each of the following nine quarters based on the increase in qualified small business lending as defined in the agreement The dividend rate will vary between 1 and 5 as lending increases vary between 10 and 25 The fixed dividend rate for the tenth quarter after funding through the end of the first four and one-half years is set as described above if lending has increased at the end of the eighth quarter after funding If lending has not increased at the end of the eighth quarter after funding the fixed dividend rate is set at 7 The fixed dividend rate after four and one-half years is set at 9 if the funding has not already been repaid The dividend rate at December 31 2014 and 2013 was 1 for both years
The Treasury has a liquidation preference of $1000 per share or $18000000 as of December 31 2014 Dividends are payable quarterly in arrears on January 1 April 1 July 1 and October 1 of each year Dividends payable at December 31 2014 and 2013 are $45000 and $0 respectively The Company may repay the funding at any time with regulatory approval
11
bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull
COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 8 - ACCUMULATED OTHER COMPREHENSIVE INCOME
Central Bank and Milford Holdings Inc maintain certain securities in an available-for-sale category At December 31 2014 and 2013 combined accumulated other comprehensive income related to available-for-sale securities in the amount of $111415 and $172428 respectively was recorded directly to the Companys stockholders equity for its 100 proportionate share of the other comprehensive income
NOTE 9 - SUBSEQUENT EVENTS
Management evaluated subsequent events through March 6 2015 the date the financial statements were available to be issued Events or transactions occurring after December 31 2014 but prior to March 6 2015 that provided additional evidence about conditions that existed at December 31 2014 have been recognized in the financial statements for the year ended December 31 2014 Events or transactions that provided evidence about conditions that did not exist at December 31 2014 but arose before the financial statements were available to be issued have not been recognized in the financial statements for the year ended December 31 2014
See accountants compilation report
12
COMMERCIAL FINANCIAL CORP
Report - rem J Commercial Fuianc1al Corp is not required to file with the Secunt1es and
Exchange Comfriiksion r bull 1 R
eport
Item 111 Fmancial statenints parent company only of Commercial Fmancial Corp middotI
are attached Cppsolidated financial statements are not prepared h 1 I I fb m t e norma colirtse o usmess
Report-Item 2J U Organizational Chart middot See attabhed chart
Report- Item 2J k Banch Verification l Ii See attced chart
Report-Item 3 l middot middot Listing of sharehfders that directly or indirectly own control or hold with power to v9t 5 or more of any class of shares of the bank holding Company middotmiddotj
gt ll I
Name andAddrJJs J Timothy J Brovampn 1 Storm Lake IoWa I
i
John C Brown f 1 Spirit Lake IovM
1 f - (
Citizenship
1JSA
USA
Report Item 4 -se Schedule Attached
t
l H
il
Class A Common
Shares Owned
5009
3385
Percentage
5967
4033
Class B Common
Shares Owned
1296
44
Percentage
9460
321
ORGANIZATIONAL CHART
Report - Item 2(a) - Organization chart - Commercial Financial Corp Incorporated State of Iowa - Lakes Bancorporation Inc Incorporated State of Iowa - Central Bank Incorporated State of Iowa - Milford Holdings Inc Incorporated State of Iowa - Central Statutory Trust II Deleware Statutory Trust - Real Estate Owned LLC lncorprated State of Iowa - Central Florida Real Estate Owned LLC Incorporated State of Florida - Toss II LLC Incorporated State of Iowa
COMMERCIAL FINANCIAL CORP STORM LAKE IA
Non-Managing M Owns 40
ember
Toss II LLC Stonn Lake IA
Footnotes
Owns 65
CENTRAL BANK
STORM LAKE IA
Owns 100
MILFORD HOLDINGS INC STORM LAKE IA
(See footnote 1)
Lakes Bancorporation Inc
Stonn Lake IA
Owns 35
Managing Member Owns 100
REAL ESTATE OWNED LLC
STORM LAKE IA
1 Commercial Financial Corp owns 5540000 (100) of the outstanding shares of voting common stock
Owns 100
CENTRAL STATUTORY TRUST II
STORM LAKE IA
Managing Memb Owns 100
CENTRAL FLORIDA REAL ESTATE OWNED LLC
STORM LAKE IA
er
Results A list of branches for your holding company COMMERC1ALflNANCJALCORP (1978574) of STORM IAKE IA The data are as of 12312014 Data reflects lnfo1maton that was received and processd through Ol07 2015
Reconcl1alon md Vertncaloo SICli 1 Jn the Data Action column of each branch row enter one or more of the actions specified below 2 If required enter the date In the Effective Date column
Actions OK If the branch Information Is correct enterOK In the Data Action coumn
Change tr the branch Information Is Incorrect or Incomplete revise the data enterOrnnge In the Data Action colllmn and the date when this Information rlrstbecame vaJd In the Effective Dale column Close If a branch lsted was sold or closed enter Clos In the Data Actlori column and the sale or closure date In the Effective Date coumn Delete ]f a branch Med was never owned by this depository Institution enter Odele In the Data Action column Add Jf a reportable branch Is missing Insert a row add the branch data and enterAdd In the Data Action column and the opening or acqulsltfon date In theEHectlve Date column
If printing this Hsi you may need to adjust your pa Be setup In MS Excel Try uslng landscape orientation page scaling andor e(lal siled paper
Submission Procedure When you are finished send a saved copy to your FRB contact See the detailed Instructions on this site for more Information If you are e-malllng th ls to your FRB contact put your Institution name dty and state In the subject tine of the emiddotmall
Note To sltitislythe FR YmiddotlO reporting requirements you must aim submit FR YmiddotlO Domestic Branch Schedules for each branch with a Data Action of Q1ange dose Delete or Add The FR Y-10 report may be submitted In a hardcopy format or via the FR YmiddotlO Onlne applcatlon bull httpsylOonUnefederalreservegov
bull FOCUNINUM Office Number and D_RSSD columns are for reference only Verlflcatron of these values ls not required
Data Action Effective Date Branch Service Type Branch ID RSSDbull Popular Name Street Address City
OK Full Service Head Office) 545544 CENTRAL BANK 600 LAKE AVENUE STORM lAKE OK Full Service 4154B52 ANKENY BOULEVARD BRANCH 2805 NORTH ANKENY BOULEVARD ANKENY
OK Umlted Servke 2116588 CHEROKEE BRANCH 2BOW DRIVE CHEROKEE
OK Full Service 802848 CHEROKEE CENTRAL TRUST BRANCH 401 WEST MAIN STREET CHEROKEE
OK Full Service 2161147 4018 UNIVERSITY AVENUEOFFJCE 4018 UNIVERSITY AVENUE DES MOINES
OK Full Service 4155104 HUBBEL AVENUE BRANCH 2742 HUBBELLAVENUE DES MOINES
OK Full Service 4155270 WALNUT STREETS RANCH 700 WALNUT STREET DES MOINES
OK Full Service 4493169 4201 SOUTH LAKEPORT BRANCH 4201 SOUTH LAKEPORT SIOUX CITY
OK FuI Service 3078064 522 fOURTH STREET BRANCH 522 4TH STREET SIOUX CITY
OK Full Service 3596719 stoux OiY BRANCH 2-906 HAMILTON BLVD SIOUX CITY
OK Full Servke 810142 SPIRIT IAKE BRANCH 1400 1BTH STREET SPIRIT LAKE
OK limited Service 2045050 DRIVEmiddotIN BRANCH 1237 LAKE AVENUE STORM LAKE
OK Full Servke 4155252 URBANDALE BRANCH 3800 lOOTH STREET URBANDALE
OK Full Service 44931SO 6501 WESTOWN PARKWAY BRANCH 6601 WESTOWN PARKWAYSUITE140 WEST DES MOINES
OK Full Service 4639444 ASHWORTH ROAD BRANCH 6139 ASHWORTH ROAD WEST DES MOINES OK Full Service 4155131 MILLS ClVJCPARr-NAY BRANCH 5070 MILLS CIVIC PARKWAY WEST DES MOINES
State Zip Code County IA 505BS BUENA VISTA IA 50023 POLK IA 51012 CHEROKEE IA 51012 CHEROKEE IA 50311 POLK
IA 50317 POLK IA 50309 POLK IA 51106 WOODBURY
IA 51101 WOODBURY
IA 51104 WOODBURY IA Sl360 DICKINSON IA 505BBmiddot19 BUENA VISTA IA 50322 POLK IA S0266 POLK IA 50266 POLK IA 50265 POLK
Country FDICUNINUM+ Office Numberbull Head Offlce Head Office ID RSSDbull Comments UNITED STATES 9849 0 CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544 UNITED STATES 263121 6 CENTRAL BANK 546544 UNITED STATES 6467 3 CENTRAL BANK 545544 UNITED STATES Not Requred Not Required CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544
UNITED STATES Not Required Not Required CENTRAL BANK 546S44 UNITED STATES Not Required Nol Required CENTRAL BANK S46544 UNITED STATES 362876 7 CENTRAL BANK S45544 UNITED STATES 465474 9 CENTRAL BANK S46544
UNITED STATES 9695 8 CENTRAL BANK 546544
UNITED STATES 234537 l CENTRAL BANK 546S44 UNITED STATES Not Required Not Required CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544
UNITED STATES Not Required Not Requred CENTRAL BANK 546544
UNITED STATES Nol Required Not Required CENTRAL BANK 546544
Report Item 4 - Brincipal Shareholders Director Executive Officer ofBaMlHolding Company
1 (1) Name and adhress middoti
(2) Principal oc4Lation if other than with Miaing company
(3) Title or posltion with 1 I (a) Bank ho)g company
I j
(b) See Atta9ped I ( c) Other busfuess companies
l TossLLC Toss IT1f-LC
i Imiddot ( 4) Number of sliitres and percentage
of voting sedrities owned middot controlled oJ eldwith power to vote ii (a) Barik holtlmg company -1
Clas Common Class Common (Nobivoting)
i I (b) Subsidiaries of bank
h ld ti 0 mgmiddot1rmpany
i (c) Otherbusillfss companies
I
TossLic Meser units
Toss II ILLC Member units
I
Timothy J Brown Storm Lake Iowa
NIA
President and Director
Member Member
5009 Shares 5967
1296 Shares 9460
None
1667
1667
John C Brown Spirit Lake Iowa
NIA
Secretary Treasurer and Director
Member Member
3385 Shares 4033
44 Shares 321
None
1667
1667
r
Report Item 4 - Rrincipal Shareholders Director Executive Officer of BanhlEolding Company
middotI
(3) Title or p9itiori with middotI I
bull1 (b) Subsidiaes of
holding 1qompany
Central Bank I I
middot1 ti
Jvlilford Holtljitgs Inc I
i
I
I
middotl 1 i
i
Timothy J Brown Storm Lake Iowa
President and Director
President and Director
John C Brown Spirit Lake Iowa
Executive ViceshyPresident Secretary and Director
Executive ViceshyPtesident Secretary and Director
- FR Y-6 Cover Page
- For Use By Tiered Holding Companies
- Report Item 1 Annual Report to Shareholders
- Report Item 2a Organization Chart
- Report Item 2b Domestic Branch Listing
- Report Item 3 Securities Holders
- Report Item 4 Insiders
-
bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull
COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 6 - SUBSIDIARY CONDENSED FINANCIAL STATEMENTS (CONTINUED)
The following is a summary of selected unaudited financial information of Central Statutory Trust II based on December 31 2014 and 2013 quarterly financial statements of nonbank subsidiaries filed with the Federal Reserve System
2014 2013
Total assets $ 8248000 $ 8248000
Liabilities $ 8000000 $ 8000000 Stockholders equity 248000 248000
Total liabilities and stockholders equity $ 8248000 $ 8248000
Net income $ $
NOTE 7 - SENIOR PREFERRED STOCK
The Company executed a Small Business Lending Fund Securities Purchase Agreement with the United States Department of the Treasury (Treasury) effective September 20 2011 Through the Small Business Lending Fund (SBLF) the Treasury provides Tier 1 capital to community banks and other eligible institutions Each institution pays dividend rates that go down as its small business lending goes up
Treasury was issued 18000 shares of Senior Non-Cumulative Perpetual Preferred Stock Series A for $18000000 on September 20 2011 The initial dividend rate was 5 The variable dividend rate may decrease each of the following nine quarters based on the increase in qualified small business lending as defined in the agreement The dividend rate will vary between 1 and 5 as lending increases vary between 10 and 25 The fixed dividend rate for the tenth quarter after funding through the end of the first four and one-half years is set as described above if lending has increased at the end of the eighth quarter after funding If lending has not increased at the end of the eighth quarter after funding the fixed dividend rate is set at 7 The fixed dividend rate after four and one-half years is set at 9 if the funding has not already been repaid The dividend rate at December 31 2014 and 2013 was 1 for both years
The Treasury has a liquidation preference of $1000 per share or $18000000 as of December 31 2014 Dividends are payable quarterly in arrears on January 1 April 1 July 1 and October 1 of each year Dividends payable at December 31 2014 and 2013 are $45000 and $0 respectively The Company may repay the funding at any time with regulatory approval
11
bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull
COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 8 - ACCUMULATED OTHER COMPREHENSIVE INCOME
Central Bank and Milford Holdings Inc maintain certain securities in an available-for-sale category At December 31 2014 and 2013 combined accumulated other comprehensive income related to available-for-sale securities in the amount of $111415 and $172428 respectively was recorded directly to the Companys stockholders equity for its 100 proportionate share of the other comprehensive income
NOTE 9 - SUBSEQUENT EVENTS
Management evaluated subsequent events through March 6 2015 the date the financial statements were available to be issued Events or transactions occurring after December 31 2014 but prior to March 6 2015 that provided additional evidence about conditions that existed at December 31 2014 have been recognized in the financial statements for the year ended December 31 2014 Events or transactions that provided evidence about conditions that did not exist at December 31 2014 but arose before the financial statements were available to be issued have not been recognized in the financial statements for the year ended December 31 2014
See accountants compilation report
12
COMMERCIAL FINANCIAL CORP
Report - rem J Commercial Fuianc1al Corp is not required to file with the Secunt1es and
Exchange Comfriiksion r bull 1 R
eport
Item 111 Fmancial statenints parent company only of Commercial Fmancial Corp middotI
are attached Cppsolidated financial statements are not prepared h 1 I I fb m t e norma colirtse o usmess
Report-Item 2J U Organizational Chart middot See attabhed chart
Report- Item 2J k Banch Verification l Ii See attced chart
Report-Item 3 l middot middot Listing of sharehfders that directly or indirectly own control or hold with power to v9t 5 or more of any class of shares of the bank holding Company middotmiddotj
gt ll I
Name andAddrJJs J Timothy J Brovampn 1 Storm Lake IoWa I
i
John C Brown f 1 Spirit Lake IovM
1 f - (
Citizenship
1JSA
USA
Report Item 4 -se Schedule Attached
t
l H
il
Class A Common
Shares Owned
5009
3385
Percentage
5967
4033
Class B Common
Shares Owned
1296
44
Percentage
9460
321
ORGANIZATIONAL CHART
Report - Item 2(a) - Organization chart - Commercial Financial Corp Incorporated State of Iowa - Lakes Bancorporation Inc Incorporated State of Iowa - Central Bank Incorporated State of Iowa - Milford Holdings Inc Incorporated State of Iowa - Central Statutory Trust II Deleware Statutory Trust - Real Estate Owned LLC lncorprated State of Iowa - Central Florida Real Estate Owned LLC Incorporated State of Florida - Toss II LLC Incorporated State of Iowa
COMMERCIAL FINANCIAL CORP STORM LAKE IA
Non-Managing M Owns 40
ember
Toss II LLC Stonn Lake IA
Footnotes
Owns 65
CENTRAL BANK
STORM LAKE IA
Owns 100
MILFORD HOLDINGS INC STORM LAKE IA
(See footnote 1)
Lakes Bancorporation Inc
Stonn Lake IA
Owns 35
Managing Member Owns 100
REAL ESTATE OWNED LLC
STORM LAKE IA
1 Commercial Financial Corp owns 5540000 (100) of the outstanding shares of voting common stock
Owns 100
CENTRAL STATUTORY TRUST II
STORM LAKE IA
Managing Memb Owns 100
CENTRAL FLORIDA REAL ESTATE OWNED LLC
STORM LAKE IA
er
Results A list of branches for your holding company COMMERC1ALflNANCJALCORP (1978574) of STORM IAKE IA The data are as of 12312014 Data reflects lnfo1maton that was received and processd through Ol07 2015
Reconcl1alon md Vertncaloo SICli 1 Jn the Data Action column of each branch row enter one or more of the actions specified below 2 If required enter the date In the Effective Date column
Actions OK If the branch Information Is correct enterOK In the Data Action coumn
Change tr the branch Information Is Incorrect or Incomplete revise the data enterOrnnge In the Data Action colllmn and the date when this Information rlrstbecame vaJd In the Effective Dale column Close If a branch lsted was sold or closed enter Clos In the Data Actlori column and the sale or closure date In the Effective Date coumn Delete ]f a branch Med was never owned by this depository Institution enter Odele In the Data Action column Add Jf a reportable branch Is missing Insert a row add the branch data and enterAdd In the Data Action column and the opening or acqulsltfon date In theEHectlve Date column
If printing this Hsi you may need to adjust your pa Be setup In MS Excel Try uslng landscape orientation page scaling andor e(lal siled paper
Submission Procedure When you are finished send a saved copy to your FRB contact See the detailed Instructions on this site for more Information If you are e-malllng th ls to your FRB contact put your Institution name dty and state In the subject tine of the emiddotmall
Note To sltitislythe FR YmiddotlO reporting requirements you must aim submit FR YmiddotlO Domestic Branch Schedules for each branch with a Data Action of Q1ange dose Delete or Add The FR Y-10 report may be submitted In a hardcopy format or via the FR YmiddotlO Onlne applcatlon bull httpsylOonUnefederalreservegov
bull FOCUNINUM Office Number and D_RSSD columns are for reference only Verlflcatron of these values ls not required
Data Action Effective Date Branch Service Type Branch ID RSSDbull Popular Name Street Address City
OK Full Service Head Office) 545544 CENTRAL BANK 600 LAKE AVENUE STORM lAKE OK Full Service 4154B52 ANKENY BOULEVARD BRANCH 2805 NORTH ANKENY BOULEVARD ANKENY
OK Umlted Servke 2116588 CHEROKEE BRANCH 2BOW DRIVE CHEROKEE
OK Full Service 802848 CHEROKEE CENTRAL TRUST BRANCH 401 WEST MAIN STREET CHEROKEE
OK Full Service 2161147 4018 UNIVERSITY AVENUEOFFJCE 4018 UNIVERSITY AVENUE DES MOINES
OK Full Service 4155104 HUBBEL AVENUE BRANCH 2742 HUBBELLAVENUE DES MOINES
OK Full Service 4155270 WALNUT STREETS RANCH 700 WALNUT STREET DES MOINES
OK Full Service 4493169 4201 SOUTH LAKEPORT BRANCH 4201 SOUTH LAKEPORT SIOUX CITY
OK FuI Service 3078064 522 fOURTH STREET BRANCH 522 4TH STREET SIOUX CITY
OK Full Service 3596719 stoux OiY BRANCH 2-906 HAMILTON BLVD SIOUX CITY
OK Full Servke 810142 SPIRIT IAKE BRANCH 1400 1BTH STREET SPIRIT LAKE
OK limited Service 2045050 DRIVEmiddotIN BRANCH 1237 LAKE AVENUE STORM LAKE
OK Full Servke 4155252 URBANDALE BRANCH 3800 lOOTH STREET URBANDALE
OK Full Service 44931SO 6501 WESTOWN PARKWAY BRANCH 6601 WESTOWN PARKWAYSUITE140 WEST DES MOINES
OK Full Service 4639444 ASHWORTH ROAD BRANCH 6139 ASHWORTH ROAD WEST DES MOINES OK Full Service 4155131 MILLS ClVJCPARr-NAY BRANCH 5070 MILLS CIVIC PARKWAY WEST DES MOINES
State Zip Code County IA 505BS BUENA VISTA IA 50023 POLK IA 51012 CHEROKEE IA 51012 CHEROKEE IA 50311 POLK
IA 50317 POLK IA 50309 POLK IA 51106 WOODBURY
IA 51101 WOODBURY
IA 51104 WOODBURY IA Sl360 DICKINSON IA 505BBmiddot19 BUENA VISTA IA 50322 POLK IA S0266 POLK IA 50266 POLK IA 50265 POLK
Country FDICUNINUM+ Office Numberbull Head Offlce Head Office ID RSSDbull Comments UNITED STATES 9849 0 CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544 UNITED STATES 263121 6 CENTRAL BANK 546544 UNITED STATES 6467 3 CENTRAL BANK 545544 UNITED STATES Not Requred Not Required CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544
UNITED STATES Not Required Not Required CENTRAL BANK 546S44 UNITED STATES Not Required Nol Required CENTRAL BANK S46544 UNITED STATES 362876 7 CENTRAL BANK S45544 UNITED STATES 465474 9 CENTRAL BANK S46544
UNITED STATES 9695 8 CENTRAL BANK 546544
UNITED STATES 234537 l CENTRAL BANK 546S44 UNITED STATES Not Required Not Required CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544
UNITED STATES Not Required Not Requred CENTRAL BANK 546544
UNITED STATES Nol Required Not Required CENTRAL BANK 546544
Report Item 4 - Brincipal Shareholders Director Executive Officer ofBaMlHolding Company
1 (1) Name and adhress middoti
(2) Principal oc4Lation if other than with Miaing company
(3) Title or posltion with 1 I (a) Bank ho)g company
I j
(b) See Atta9ped I ( c) Other busfuess companies
l TossLLC Toss IT1f-LC
i Imiddot ( 4) Number of sliitres and percentage
of voting sedrities owned middot controlled oJ eldwith power to vote ii (a) Barik holtlmg company -1
Clas Common Class Common (Nobivoting)
i I (b) Subsidiaries of bank
h ld ti 0 mgmiddot1rmpany
i (c) Otherbusillfss companies
I
TossLic Meser units
Toss II ILLC Member units
I
Timothy J Brown Storm Lake Iowa
NIA
President and Director
Member Member
5009 Shares 5967
1296 Shares 9460
None
1667
1667
John C Brown Spirit Lake Iowa
NIA
Secretary Treasurer and Director
Member Member
3385 Shares 4033
44 Shares 321
None
1667
1667
r
Report Item 4 - Rrincipal Shareholders Director Executive Officer of BanhlEolding Company
middotI
(3) Title or p9itiori with middotI I
bull1 (b) Subsidiaes of
holding 1qompany
Central Bank I I
middot1 ti
Jvlilford Holtljitgs Inc I
i
I
I
middotl 1 i
i
Timothy J Brown Storm Lake Iowa
President and Director
President and Director
John C Brown Spirit Lake Iowa
Executive ViceshyPresident Secretary and Director
Executive ViceshyPtesident Secretary and Director
- FR Y-6 Cover Page
- For Use By Tiered Holding Companies
- Report Item 1 Annual Report to Shareholders
- Report Item 2a Organization Chart
- Report Item 2b Domestic Branch Listing
- Report Item 3 Securities Holders
- Report Item 4 Insiders
-
bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull bull
COMMERCIAL FINANCIAL CORP (PARENT COMPANY ONLY)
NOTES TO FINANCIAL STATEMENTS December 31 2014 and 2013
NOTE 8 - ACCUMULATED OTHER COMPREHENSIVE INCOME
Central Bank and Milford Holdings Inc maintain certain securities in an available-for-sale category At December 31 2014 and 2013 combined accumulated other comprehensive income related to available-for-sale securities in the amount of $111415 and $172428 respectively was recorded directly to the Companys stockholders equity for its 100 proportionate share of the other comprehensive income
NOTE 9 - SUBSEQUENT EVENTS
Management evaluated subsequent events through March 6 2015 the date the financial statements were available to be issued Events or transactions occurring after December 31 2014 but prior to March 6 2015 that provided additional evidence about conditions that existed at December 31 2014 have been recognized in the financial statements for the year ended December 31 2014 Events or transactions that provided evidence about conditions that did not exist at December 31 2014 but arose before the financial statements were available to be issued have not been recognized in the financial statements for the year ended December 31 2014
See accountants compilation report
12
COMMERCIAL FINANCIAL CORP
Report - rem J Commercial Fuianc1al Corp is not required to file with the Secunt1es and
Exchange Comfriiksion r bull 1 R
eport
Item 111 Fmancial statenints parent company only of Commercial Fmancial Corp middotI
are attached Cppsolidated financial statements are not prepared h 1 I I fb m t e norma colirtse o usmess
Report-Item 2J U Organizational Chart middot See attabhed chart
Report- Item 2J k Banch Verification l Ii See attced chart
Report-Item 3 l middot middot Listing of sharehfders that directly or indirectly own control or hold with power to v9t 5 or more of any class of shares of the bank holding Company middotmiddotj
gt ll I
Name andAddrJJs J Timothy J Brovampn 1 Storm Lake IoWa I
i
John C Brown f 1 Spirit Lake IovM
1 f - (
Citizenship
1JSA
USA
Report Item 4 -se Schedule Attached
t
l H
il
Class A Common
Shares Owned
5009
3385
Percentage
5967
4033
Class B Common
Shares Owned
1296
44
Percentage
9460
321
ORGANIZATIONAL CHART
Report - Item 2(a) - Organization chart - Commercial Financial Corp Incorporated State of Iowa - Lakes Bancorporation Inc Incorporated State of Iowa - Central Bank Incorporated State of Iowa - Milford Holdings Inc Incorporated State of Iowa - Central Statutory Trust II Deleware Statutory Trust - Real Estate Owned LLC lncorprated State of Iowa - Central Florida Real Estate Owned LLC Incorporated State of Florida - Toss II LLC Incorporated State of Iowa
COMMERCIAL FINANCIAL CORP STORM LAKE IA
Non-Managing M Owns 40
ember
Toss II LLC Stonn Lake IA
Footnotes
Owns 65
CENTRAL BANK
STORM LAKE IA
Owns 100
MILFORD HOLDINGS INC STORM LAKE IA
(See footnote 1)
Lakes Bancorporation Inc
Stonn Lake IA
Owns 35
Managing Member Owns 100
REAL ESTATE OWNED LLC
STORM LAKE IA
1 Commercial Financial Corp owns 5540000 (100) of the outstanding shares of voting common stock
Owns 100
CENTRAL STATUTORY TRUST II
STORM LAKE IA
Managing Memb Owns 100
CENTRAL FLORIDA REAL ESTATE OWNED LLC
STORM LAKE IA
er
Results A list of branches for your holding company COMMERC1ALflNANCJALCORP (1978574) of STORM IAKE IA The data are as of 12312014 Data reflects lnfo1maton that was received and processd through Ol07 2015
Reconcl1alon md Vertncaloo SICli 1 Jn the Data Action column of each branch row enter one or more of the actions specified below 2 If required enter the date In the Effective Date column
Actions OK If the branch Information Is correct enterOK In the Data Action coumn
Change tr the branch Information Is Incorrect or Incomplete revise the data enterOrnnge In the Data Action colllmn and the date when this Information rlrstbecame vaJd In the Effective Dale column Close If a branch lsted was sold or closed enter Clos In the Data Actlori column and the sale or closure date In the Effective Date coumn Delete ]f a branch Med was never owned by this depository Institution enter Odele In the Data Action column Add Jf a reportable branch Is missing Insert a row add the branch data and enterAdd In the Data Action column and the opening or acqulsltfon date In theEHectlve Date column
If printing this Hsi you may need to adjust your pa Be setup In MS Excel Try uslng landscape orientation page scaling andor e(lal siled paper
Submission Procedure When you are finished send a saved copy to your FRB contact See the detailed Instructions on this site for more Information If you are e-malllng th ls to your FRB contact put your Institution name dty and state In the subject tine of the emiddotmall
Note To sltitislythe FR YmiddotlO reporting requirements you must aim submit FR YmiddotlO Domestic Branch Schedules for each branch with a Data Action of Q1ange dose Delete or Add The FR Y-10 report may be submitted In a hardcopy format or via the FR YmiddotlO Onlne applcatlon bull httpsylOonUnefederalreservegov
bull FOCUNINUM Office Number and D_RSSD columns are for reference only Verlflcatron of these values ls not required
Data Action Effective Date Branch Service Type Branch ID RSSDbull Popular Name Street Address City
OK Full Service Head Office) 545544 CENTRAL BANK 600 LAKE AVENUE STORM lAKE OK Full Service 4154B52 ANKENY BOULEVARD BRANCH 2805 NORTH ANKENY BOULEVARD ANKENY
OK Umlted Servke 2116588 CHEROKEE BRANCH 2BOW DRIVE CHEROKEE
OK Full Service 802848 CHEROKEE CENTRAL TRUST BRANCH 401 WEST MAIN STREET CHEROKEE
OK Full Service 2161147 4018 UNIVERSITY AVENUEOFFJCE 4018 UNIVERSITY AVENUE DES MOINES
OK Full Service 4155104 HUBBEL AVENUE BRANCH 2742 HUBBELLAVENUE DES MOINES
OK Full Service 4155270 WALNUT STREETS RANCH 700 WALNUT STREET DES MOINES
OK Full Service 4493169 4201 SOUTH LAKEPORT BRANCH 4201 SOUTH LAKEPORT SIOUX CITY
OK FuI Service 3078064 522 fOURTH STREET BRANCH 522 4TH STREET SIOUX CITY
OK Full Service 3596719 stoux OiY BRANCH 2-906 HAMILTON BLVD SIOUX CITY
OK Full Servke 810142 SPIRIT IAKE BRANCH 1400 1BTH STREET SPIRIT LAKE
OK limited Service 2045050 DRIVEmiddotIN BRANCH 1237 LAKE AVENUE STORM LAKE
OK Full Servke 4155252 URBANDALE BRANCH 3800 lOOTH STREET URBANDALE
OK Full Service 44931SO 6501 WESTOWN PARKWAY BRANCH 6601 WESTOWN PARKWAYSUITE140 WEST DES MOINES
OK Full Service 4639444 ASHWORTH ROAD BRANCH 6139 ASHWORTH ROAD WEST DES MOINES OK Full Service 4155131 MILLS ClVJCPARr-NAY BRANCH 5070 MILLS CIVIC PARKWAY WEST DES MOINES
State Zip Code County IA 505BS BUENA VISTA IA 50023 POLK IA 51012 CHEROKEE IA 51012 CHEROKEE IA 50311 POLK
IA 50317 POLK IA 50309 POLK IA 51106 WOODBURY
IA 51101 WOODBURY
IA 51104 WOODBURY IA Sl360 DICKINSON IA 505BBmiddot19 BUENA VISTA IA 50322 POLK IA S0266 POLK IA 50266 POLK IA 50265 POLK
Country FDICUNINUM+ Office Numberbull Head Offlce Head Office ID RSSDbull Comments UNITED STATES 9849 0 CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544 UNITED STATES 263121 6 CENTRAL BANK 546544 UNITED STATES 6467 3 CENTRAL BANK 545544 UNITED STATES Not Requred Not Required CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544
UNITED STATES Not Required Not Required CENTRAL BANK 546S44 UNITED STATES Not Required Nol Required CENTRAL BANK S46544 UNITED STATES 362876 7 CENTRAL BANK S45544 UNITED STATES 465474 9 CENTRAL BANK S46544
UNITED STATES 9695 8 CENTRAL BANK 546544
UNITED STATES 234537 l CENTRAL BANK 546S44 UNITED STATES Not Required Not Required CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544
UNITED STATES Not Required Not Requred CENTRAL BANK 546544
UNITED STATES Nol Required Not Required CENTRAL BANK 546544
Report Item 4 - Brincipal Shareholders Director Executive Officer ofBaMlHolding Company
1 (1) Name and adhress middoti
(2) Principal oc4Lation if other than with Miaing company
(3) Title or posltion with 1 I (a) Bank ho)g company
I j
(b) See Atta9ped I ( c) Other busfuess companies
l TossLLC Toss IT1f-LC
i Imiddot ( 4) Number of sliitres and percentage
of voting sedrities owned middot controlled oJ eldwith power to vote ii (a) Barik holtlmg company -1
Clas Common Class Common (Nobivoting)
i I (b) Subsidiaries of bank
h ld ti 0 mgmiddot1rmpany
i (c) Otherbusillfss companies
I
TossLic Meser units
Toss II ILLC Member units
I
Timothy J Brown Storm Lake Iowa
NIA
President and Director
Member Member
5009 Shares 5967
1296 Shares 9460
None
1667
1667
John C Brown Spirit Lake Iowa
NIA
Secretary Treasurer and Director
Member Member
3385 Shares 4033
44 Shares 321
None
1667
1667
r
Report Item 4 - Rrincipal Shareholders Director Executive Officer of BanhlEolding Company
middotI
(3) Title or p9itiori with middotI I
bull1 (b) Subsidiaes of
holding 1qompany
Central Bank I I
middot1 ti
Jvlilford Holtljitgs Inc I
i
I
I
middotl 1 i
i
Timothy J Brown Storm Lake Iowa
President and Director
President and Director
John C Brown Spirit Lake Iowa
Executive ViceshyPresident Secretary and Director
Executive ViceshyPtesident Secretary and Director
- FR Y-6 Cover Page
- For Use By Tiered Holding Companies
- Report Item 1 Annual Report to Shareholders
- Report Item 2a Organization Chart
- Report Item 2b Domestic Branch Listing
- Report Item 3 Securities Holders
- Report Item 4 Insiders
-
COMMERCIAL FINANCIAL CORP
Report - rem J Commercial Fuianc1al Corp is not required to file with the Secunt1es and
Exchange Comfriiksion r bull 1 R
eport
Item 111 Fmancial statenints parent company only of Commercial Fmancial Corp middotI
are attached Cppsolidated financial statements are not prepared h 1 I I fb m t e norma colirtse o usmess
Report-Item 2J U Organizational Chart middot See attabhed chart
Report- Item 2J k Banch Verification l Ii See attced chart
Report-Item 3 l middot middot Listing of sharehfders that directly or indirectly own control or hold with power to v9t 5 or more of any class of shares of the bank holding Company middotmiddotj
gt ll I
Name andAddrJJs J Timothy J Brovampn 1 Storm Lake IoWa I
i
John C Brown f 1 Spirit Lake IovM
1 f - (
Citizenship
1JSA
USA
Report Item 4 -se Schedule Attached
t
l H
il
Class A Common
Shares Owned
5009
3385
Percentage
5967
4033
Class B Common
Shares Owned
1296
44
Percentage
9460
321
ORGANIZATIONAL CHART
Report - Item 2(a) - Organization chart - Commercial Financial Corp Incorporated State of Iowa - Lakes Bancorporation Inc Incorporated State of Iowa - Central Bank Incorporated State of Iowa - Milford Holdings Inc Incorporated State of Iowa - Central Statutory Trust II Deleware Statutory Trust - Real Estate Owned LLC lncorprated State of Iowa - Central Florida Real Estate Owned LLC Incorporated State of Florida - Toss II LLC Incorporated State of Iowa
COMMERCIAL FINANCIAL CORP STORM LAKE IA
Non-Managing M Owns 40
ember
Toss II LLC Stonn Lake IA
Footnotes
Owns 65
CENTRAL BANK
STORM LAKE IA
Owns 100
MILFORD HOLDINGS INC STORM LAKE IA
(See footnote 1)
Lakes Bancorporation Inc
Stonn Lake IA
Owns 35
Managing Member Owns 100
REAL ESTATE OWNED LLC
STORM LAKE IA
1 Commercial Financial Corp owns 5540000 (100) of the outstanding shares of voting common stock
Owns 100
CENTRAL STATUTORY TRUST II
STORM LAKE IA
Managing Memb Owns 100
CENTRAL FLORIDA REAL ESTATE OWNED LLC
STORM LAKE IA
er
Results A list of branches for your holding company COMMERC1ALflNANCJALCORP (1978574) of STORM IAKE IA The data are as of 12312014 Data reflects lnfo1maton that was received and processd through Ol07 2015
Reconcl1alon md Vertncaloo SICli 1 Jn the Data Action column of each branch row enter one or more of the actions specified below 2 If required enter the date In the Effective Date column
Actions OK If the branch Information Is correct enterOK In the Data Action coumn
Change tr the branch Information Is Incorrect or Incomplete revise the data enterOrnnge In the Data Action colllmn and the date when this Information rlrstbecame vaJd In the Effective Dale column Close If a branch lsted was sold or closed enter Clos In the Data Actlori column and the sale or closure date In the Effective Date coumn Delete ]f a branch Med was never owned by this depository Institution enter Odele In the Data Action column Add Jf a reportable branch Is missing Insert a row add the branch data and enterAdd In the Data Action column and the opening or acqulsltfon date In theEHectlve Date column
If printing this Hsi you may need to adjust your pa Be setup In MS Excel Try uslng landscape orientation page scaling andor e(lal siled paper
Submission Procedure When you are finished send a saved copy to your FRB contact See the detailed Instructions on this site for more Information If you are e-malllng th ls to your FRB contact put your Institution name dty and state In the subject tine of the emiddotmall
Note To sltitislythe FR YmiddotlO reporting requirements you must aim submit FR YmiddotlO Domestic Branch Schedules for each branch with a Data Action of Q1ange dose Delete or Add The FR Y-10 report may be submitted In a hardcopy format or via the FR YmiddotlO Onlne applcatlon bull httpsylOonUnefederalreservegov
bull FOCUNINUM Office Number and D_RSSD columns are for reference only Verlflcatron of these values ls not required
Data Action Effective Date Branch Service Type Branch ID RSSDbull Popular Name Street Address City
OK Full Service Head Office) 545544 CENTRAL BANK 600 LAKE AVENUE STORM lAKE OK Full Service 4154B52 ANKENY BOULEVARD BRANCH 2805 NORTH ANKENY BOULEVARD ANKENY
OK Umlted Servke 2116588 CHEROKEE BRANCH 2BOW DRIVE CHEROKEE
OK Full Service 802848 CHEROKEE CENTRAL TRUST BRANCH 401 WEST MAIN STREET CHEROKEE
OK Full Service 2161147 4018 UNIVERSITY AVENUEOFFJCE 4018 UNIVERSITY AVENUE DES MOINES
OK Full Service 4155104 HUBBEL AVENUE BRANCH 2742 HUBBELLAVENUE DES MOINES
OK Full Service 4155270 WALNUT STREETS RANCH 700 WALNUT STREET DES MOINES
OK Full Service 4493169 4201 SOUTH LAKEPORT BRANCH 4201 SOUTH LAKEPORT SIOUX CITY
OK FuI Service 3078064 522 fOURTH STREET BRANCH 522 4TH STREET SIOUX CITY
OK Full Service 3596719 stoux OiY BRANCH 2-906 HAMILTON BLVD SIOUX CITY
OK Full Servke 810142 SPIRIT IAKE BRANCH 1400 1BTH STREET SPIRIT LAKE
OK limited Service 2045050 DRIVEmiddotIN BRANCH 1237 LAKE AVENUE STORM LAKE
OK Full Servke 4155252 URBANDALE BRANCH 3800 lOOTH STREET URBANDALE
OK Full Service 44931SO 6501 WESTOWN PARKWAY BRANCH 6601 WESTOWN PARKWAYSUITE140 WEST DES MOINES
OK Full Service 4639444 ASHWORTH ROAD BRANCH 6139 ASHWORTH ROAD WEST DES MOINES OK Full Service 4155131 MILLS ClVJCPARr-NAY BRANCH 5070 MILLS CIVIC PARKWAY WEST DES MOINES
State Zip Code County IA 505BS BUENA VISTA IA 50023 POLK IA 51012 CHEROKEE IA 51012 CHEROKEE IA 50311 POLK
IA 50317 POLK IA 50309 POLK IA 51106 WOODBURY
IA 51101 WOODBURY
IA 51104 WOODBURY IA Sl360 DICKINSON IA 505BBmiddot19 BUENA VISTA IA 50322 POLK IA S0266 POLK IA 50266 POLK IA 50265 POLK
Country FDICUNINUM+ Office Numberbull Head Offlce Head Office ID RSSDbull Comments UNITED STATES 9849 0 CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544 UNITED STATES 263121 6 CENTRAL BANK 546544 UNITED STATES 6467 3 CENTRAL BANK 545544 UNITED STATES Not Requred Not Required CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544
UNITED STATES Not Required Not Required CENTRAL BANK 546S44 UNITED STATES Not Required Nol Required CENTRAL BANK S46544 UNITED STATES 362876 7 CENTRAL BANK S45544 UNITED STATES 465474 9 CENTRAL BANK S46544
UNITED STATES 9695 8 CENTRAL BANK 546544
UNITED STATES 234537 l CENTRAL BANK 546S44 UNITED STATES Not Required Not Required CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544
UNITED STATES Not Required Not Requred CENTRAL BANK 546544
UNITED STATES Nol Required Not Required CENTRAL BANK 546544
Report Item 4 - Brincipal Shareholders Director Executive Officer ofBaMlHolding Company
1 (1) Name and adhress middoti
(2) Principal oc4Lation if other than with Miaing company
(3) Title or posltion with 1 I (a) Bank ho)g company
I j
(b) See Atta9ped I ( c) Other busfuess companies
l TossLLC Toss IT1f-LC
i Imiddot ( 4) Number of sliitres and percentage
of voting sedrities owned middot controlled oJ eldwith power to vote ii (a) Barik holtlmg company -1
Clas Common Class Common (Nobivoting)
i I (b) Subsidiaries of bank
h ld ti 0 mgmiddot1rmpany
i (c) Otherbusillfss companies
I
TossLic Meser units
Toss II ILLC Member units
I
Timothy J Brown Storm Lake Iowa
NIA
President and Director
Member Member
5009 Shares 5967
1296 Shares 9460
None
1667
1667
John C Brown Spirit Lake Iowa
NIA
Secretary Treasurer and Director
Member Member
3385 Shares 4033
44 Shares 321
None
1667
1667
r
Report Item 4 - Rrincipal Shareholders Director Executive Officer of BanhlEolding Company
middotI
(3) Title or p9itiori with middotI I
bull1 (b) Subsidiaes of
holding 1qompany
Central Bank I I
middot1 ti
Jvlilford Holtljitgs Inc I
i
I
I
middotl 1 i
i
Timothy J Brown Storm Lake Iowa
President and Director
President and Director
John C Brown Spirit Lake Iowa
Executive ViceshyPresident Secretary and Director
Executive ViceshyPtesident Secretary and Director
- FR Y-6 Cover Page
- For Use By Tiered Holding Companies
- Report Item 1 Annual Report to Shareholders
- Report Item 2a Organization Chart
- Report Item 2b Domestic Branch Listing
- Report Item 3 Securities Holders
- Report Item 4 Insiders
-
ORGANIZATIONAL CHART
Report - Item 2(a) - Organization chart - Commercial Financial Corp Incorporated State of Iowa - Lakes Bancorporation Inc Incorporated State of Iowa - Central Bank Incorporated State of Iowa - Milford Holdings Inc Incorporated State of Iowa - Central Statutory Trust II Deleware Statutory Trust - Real Estate Owned LLC lncorprated State of Iowa - Central Florida Real Estate Owned LLC Incorporated State of Florida - Toss II LLC Incorporated State of Iowa
COMMERCIAL FINANCIAL CORP STORM LAKE IA
Non-Managing M Owns 40
ember
Toss II LLC Stonn Lake IA
Footnotes
Owns 65
CENTRAL BANK
STORM LAKE IA
Owns 100
MILFORD HOLDINGS INC STORM LAKE IA
(See footnote 1)
Lakes Bancorporation Inc
Stonn Lake IA
Owns 35
Managing Member Owns 100
REAL ESTATE OWNED LLC
STORM LAKE IA
1 Commercial Financial Corp owns 5540000 (100) of the outstanding shares of voting common stock
Owns 100
CENTRAL STATUTORY TRUST II
STORM LAKE IA
Managing Memb Owns 100
CENTRAL FLORIDA REAL ESTATE OWNED LLC
STORM LAKE IA
er
Results A list of branches for your holding company COMMERC1ALflNANCJALCORP (1978574) of STORM IAKE IA The data are as of 12312014 Data reflects lnfo1maton that was received and processd through Ol07 2015
Reconcl1alon md Vertncaloo SICli 1 Jn the Data Action column of each branch row enter one or more of the actions specified below 2 If required enter the date In the Effective Date column
Actions OK If the branch Information Is correct enterOK In the Data Action coumn
Change tr the branch Information Is Incorrect or Incomplete revise the data enterOrnnge In the Data Action colllmn and the date when this Information rlrstbecame vaJd In the Effective Dale column Close If a branch lsted was sold or closed enter Clos In the Data Actlori column and the sale or closure date In the Effective Date coumn Delete ]f a branch Med was never owned by this depository Institution enter Odele In the Data Action column Add Jf a reportable branch Is missing Insert a row add the branch data and enterAdd In the Data Action column and the opening or acqulsltfon date In theEHectlve Date column
If printing this Hsi you may need to adjust your pa Be setup In MS Excel Try uslng landscape orientation page scaling andor e(lal siled paper
Submission Procedure When you are finished send a saved copy to your FRB contact See the detailed Instructions on this site for more Information If you are e-malllng th ls to your FRB contact put your Institution name dty and state In the subject tine of the emiddotmall
Note To sltitislythe FR YmiddotlO reporting requirements you must aim submit FR YmiddotlO Domestic Branch Schedules for each branch with a Data Action of Q1ange dose Delete or Add The FR Y-10 report may be submitted In a hardcopy format or via the FR YmiddotlO Onlne applcatlon bull httpsylOonUnefederalreservegov
bull FOCUNINUM Office Number and D_RSSD columns are for reference only Verlflcatron of these values ls not required
Data Action Effective Date Branch Service Type Branch ID RSSDbull Popular Name Street Address City
OK Full Service Head Office) 545544 CENTRAL BANK 600 LAKE AVENUE STORM lAKE OK Full Service 4154B52 ANKENY BOULEVARD BRANCH 2805 NORTH ANKENY BOULEVARD ANKENY
OK Umlted Servke 2116588 CHEROKEE BRANCH 2BOW DRIVE CHEROKEE
OK Full Service 802848 CHEROKEE CENTRAL TRUST BRANCH 401 WEST MAIN STREET CHEROKEE
OK Full Service 2161147 4018 UNIVERSITY AVENUEOFFJCE 4018 UNIVERSITY AVENUE DES MOINES
OK Full Service 4155104 HUBBEL AVENUE BRANCH 2742 HUBBELLAVENUE DES MOINES
OK Full Service 4155270 WALNUT STREETS RANCH 700 WALNUT STREET DES MOINES
OK Full Service 4493169 4201 SOUTH LAKEPORT BRANCH 4201 SOUTH LAKEPORT SIOUX CITY
OK FuI Service 3078064 522 fOURTH STREET BRANCH 522 4TH STREET SIOUX CITY
OK Full Service 3596719 stoux OiY BRANCH 2-906 HAMILTON BLVD SIOUX CITY
OK Full Servke 810142 SPIRIT IAKE BRANCH 1400 1BTH STREET SPIRIT LAKE
OK limited Service 2045050 DRIVEmiddotIN BRANCH 1237 LAKE AVENUE STORM LAKE
OK Full Servke 4155252 URBANDALE BRANCH 3800 lOOTH STREET URBANDALE
OK Full Service 44931SO 6501 WESTOWN PARKWAY BRANCH 6601 WESTOWN PARKWAYSUITE140 WEST DES MOINES
OK Full Service 4639444 ASHWORTH ROAD BRANCH 6139 ASHWORTH ROAD WEST DES MOINES OK Full Service 4155131 MILLS ClVJCPARr-NAY BRANCH 5070 MILLS CIVIC PARKWAY WEST DES MOINES
State Zip Code County IA 505BS BUENA VISTA IA 50023 POLK IA 51012 CHEROKEE IA 51012 CHEROKEE IA 50311 POLK
IA 50317 POLK IA 50309 POLK IA 51106 WOODBURY
IA 51101 WOODBURY
IA 51104 WOODBURY IA Sl360 DICKINSON IA 505BBmiddot19 BUENA VISTA IA 50322 POLK IA S0266 POLK IA 50266 POLK IA 50265 POLK
Country FDICUNINUM+ Office Numberbull Head Offlce Head Office ID RSSDbull Comments UNITED STATES 9849 0 CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544 UNITED STATES 263121 6 CENTRAL BANK 546544 UNITED STATES 6467 3 CENTRAL BANK 545544 UNITED STATES Not Requred Not Required CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544
UNITED STATES Not Required Not Required CENTRAL BANK 546S44 UNITED STATES Not Required Nol Required CENTRAL BANK S46544 UNITED STATES 362876 7 CENTRAL BANK S45544 UNITED STATES 465474 9 CENTRAL BANK S46544
UNITED STATES 9695 8 CENTRAL BANK 546544
UNITED STATES 234537 l CENTRAL BANK 546S44 UNITED STATES Not Required Not Required CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544
UNITED STATES Not Required Not Requred CENTRAL BANK 546544
UNITED STATES Nol Required Not Required CENTRAL BANK 546544
Report Item 4 - Brincipal Shareholders Director Executive Officer ofBaMlHolding Company
1 (1) Name and adhress middoti
(2) Principal oc4Lation if other than with Miaing company
(3) Title or posltion with 1 I (a) Bank ho)g company
I j
(b) See Atta9ped I ( c) Other busfuess companies
l TossLLC Toss IT1f-LC
i Imiddot ( 4) Number of sliitres and percentage
of voting sedrities owned middot controlled oJ eldwith power to vote ii (a) Barik holtlmg company -1
Clas Common Class Common (Nobivoting)
i I (b) Subsidiaries of bank
h ld ti 0 mgmiddot1rmpany
i (c) Otherbusillfss companies
I
TossLic Meser units
Toss II ILLC Member units
I
Timothy J Brown Storm Lake Iowa
NIA
President and Director
Member Member
5009 Shares 5967
1296 Shares 9460
None
1667
1667
John C Brown Spirit Lake Iowa
NIA
Secretary Treasurer and Director
Member Member
3385 Shares 4033
44 Shares 321
None
1667
1667
r
Report Item 4 - Rrincipal Shareholders Director Executive Officer of BanhlEolding Company
middotI
(3) Title or p9itiori with middotI I
bull1 (b) Subsidiaes of
holding 1qompany
Central Bank I I
middot1 ti
Jvlilford Holtljitgs Inc I
i
I
I
middotl 1 i
i
Timothy J Brown Storm Lake Iowa
President and Director
President and Director
John C Brown Spirit Lake Iowa
Executive ViceshyPresident Secretary and Director
Executive ViceshyPtesident Secretary and Director
- FR Y-6 Cover Page
- For Use By Tiered Holding Companies
- Report Item 1 Annual Report to Shareholders
- Report Item 2a Organization Chart
- Report Item 2b Domestic Branch Listing
- Report Item 3 Securities Holders
- Report Item 4 Insiders
-
Results A list of branches for your holding company COMMERC1ALflNANCJALCORP (1978574) of STORM IAKE IA The data are as of 12312014 Data reflects lnfo1maton that was received and processd through Ol07 2015
Reconcl1alon md Vertncaloo SICli 1 Jn the Data Action column of each branch row enter one or more of the actions specified below 2 If required enter the date In the Effective Date column
Actions OK If the branch Information Is correct enterOK In the Data Action coumn
Change tr the branch Information Is Incorrect or Incomplete revise the data enterOrnnge In the Data Action colllmn and the date when this Information rlrstbecame vaJd In the Effective Dale column Close If a branch lsted was sold or closed enter Clos In the Data Actlori column and the sale or closure date In the Effective Date coumn Delete ]f a branch Med was never owned by this depository Institution enter Odele In the Data Action column Add Jf a reportable branch Is missing Insert a row add the branch data and enterAdd In the Data Action column and the opening or acqulsltfon date In theEHectlve Date column
If printing this Hsi you may need to adjust your pa Be setup In MS Excel Try uslng landscape orientation page scaling andor e(lal siled paper
Submission Procedure When you are finished send a saved copy to your FRB contact See the detailed Instructions on this site for more Information If you are e-malllng th ls to your FRB contact put your Institution name dty and state In the subject tine of the emiddotmall
Note To sltitislythe FR YmiddotlO reporting requirements you must aim submit FR YmiddotlO Domestic Branch Schedules for each branch with a Data Action of Q1ange dose Delete or Add The FR Y-10 report may be submitted In a hardcopy format or via the FR YmiddotlO Onlne applcatlon bull httpsylOonUnefederalreservegov
bull FOCUNINUM Office Number and D_RSSD columns are for reference only Verlflcatron of these values ls not required
Data Action Effective Date Branch Service Type Branch ID RSSDbull Popular Name Street Address City
OK Full Service Head Office) 545544 CENTRAL BANK 600 LAKE AVENUE STORM lAKE OK Full Service 4154B52 ANKENY BOULEVARD BRANCH 2805 NORTH ANKENY BOULEVARD ANKENY
OK Umlted Servke 2116588 CHEROKEE BRANCH 2BOW DRIVE CHEROKEE
OK Full Service 802848 CHEROKEE CENTRAL TRUST BRANCH 401 WEST MAIN STREET CHEROKEE
OK Full Service 2161147 4018 UNIVERSITY AVENUEOFFJCE 4018 UNIVERSITY AVENUE DES MOINES
OK Full Service 4155104 HUBBEL AVENUE BRANCH 2742 HUBBELLAVENUE DES MOINES
OK Full Service 4155270 WALNUT STREETS RANCH 700 WALNUT STREET DES MOINES
OK Full Service 4493169 4201 SOUTH LAKEPORT BRANCH 4201 SOUTH LAKEPORT SIOUX CITY
OK FuI Service 3078064 522 fOURTH STREET BRANCH 522 4TH STREET SIOUX CITY
OK Full Service 3596719 stoux OiY BRANCH 2-906 HAMILTON BLVD SIOUX CITY
OK Full Servke 810142 SPIRIT IAKE BRANCH 1400 1BTH STREET SPIRIT LAKE
OK limited Service 2045050 DRIVEmiddotIN BRANCH 1237 LAKE AVENUE STORM LAKE
OK Full Servke 4155252 URBANDALE BRANCH 3800 lOOTH STREET URBANDALE
OK Full Service 44931SO 6501 WESTOWN PARKWAY BRANCH 6601 WESTOWN PARKWAYSUITE140 WEST DES MOINES
OK Full Service 4639444 ASHWORTH ROAD BRANCH 6139 ASHWORTH ROAD WEST DES MOINES OK Full Service 4155131 MILLS ClVJCPARr-NAY BRANCH 5070 MILLS CIVIC PARKWAY WEST DES MOINES
State Zip Code County IA 505BS BUENA VISTA IA 50023 POLK IA 51012 CHEROKEE IA 51012 CHEROKEE IA 50311 POLK
IA 50317 POLK IA 50309 POLK IA 51106 WOODBURY
IA 51101 WOODBURY
IA 51104 WOODBURY IA Sl360 DICKINSON IA 505BBmiddot19 BUENA VISTA IA 50322 POLK IA S0266 POLK IA 50266 POLK IA 50265 POLK
Country FDICUNINUM+ Office Numberbull Head Offlce Head Office ID RSSDbull Comments UNITED STATES 9849 0 CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544 UNITED STATES 263121 6 CENTRAL BANK 546544 UNITED STATES 6467 3 CENTRAL BANK 545544 UNITED STATES Not Requred Not Required CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544
UNITED STATES Not Required Not Required CENTRAL BANK 546S44 UNITED STATES Not Required Nol Required CENTRAL BANK S46544 UNITED STATES 362876 7 CENTRAL BANK S45544 UNITED STATES 465474 9 CENTRAL BANK S46544
UNITED STATES 9695 8 CENTRAL BANK 546544
UNITED STATES 234537 l CENTRAL BANK 546S44 UNITED STATES Not Required Not Required CENTRAL BANK 546544
UNITED STATES Not Required Not Required CENTRAL BANK 545544
UNITED STATES Not Required Not Requred CENTRAL BANK 546544
UNITED STATES Nol Required Not Required CENTRAL BANK 546544
Report Item 4 - Brincipal Shareholders Director Executive Officer ofBaMlHolding Company
1 (1) Name and adhress middoti
(2) Principal oc4Lation if other than with Miaing company
(3) Title or posltion with 1 I (a) Bank ho)g company
I j
(b) See Atta9ped I ( c) Other busfuess companies
l TossLLC Toss IT1f-LC
i Imiddot ( 4) Number of sliitres and percentage
of voting sedrities owned middot controlled oJ eldwith power to vote ii (a) Barik holtlmg company -1
Clas Common Class Common (Nobivoting)
i I (b) Subsidiaries of bank
h ld ti 0 mgmiddot1rmpany
i (c) Otherbusillfss companies
I
TossLic Meser units
Toss II ILLC Member units
I
Timothy J Brown Storm Lake Iowa
NIA
President and Director
Member Member
5009 Shares 5967
1296 Shares 9460
None
1667
1667
John C Brown Spirit Lake Iowa
NIA
Secretary Treasurer and Director
Member Member
3385 Shares 4033
44 Shares 321
None
1667
1667
r
Report Item 4 - Rrincipal Shareholders Director Executive Officer of BanhlEolding Company
middotI
(3) Title or p9itiori with middotI I
bull1 (b) Subsidiaes of
holding 1qompany
Central Bank I I
middot1 ti
Jvlilford Holtljitgs Inc I
i
I
I
middotl 1 i
i
Timothy J Brown Storm Lake Iowa
President and Director
President and Director
John C Brown Spirit Lake Iowa
Executive ViceshyPresident Secretary and Director
Executive ViceshyPtesident Secretary and Director
- FR Y-6 Cover Page
- For Use By Tiered Holding Companies
- Report Item 1 Annual Report to Shareholders
- Report Item 2a Organization Chart
- Report Item 2b Domestic Branch Listing
- Report Item 3 Securities Holders
- Report Item 4 Insiders
-
Report Item 4 - Brincipal Shareholders Director Executive Officer ofBaMlHolding Company
1 (1) Name and adhress middoti
(2) Principal oc4Lation if other than with Miaing company
(3) Title or posltion with 1 I (a) Bank ho)g company
I j
(b) See Atta9ped I ( c) Other busfuess companies
l TossLLC Toss IT1f-LC
i Imiddot ( 4) Number of sliitres and percentage
of voting sedrities owned middot controlled oJ eldwith power to vote ii (a) Barik holtlmg company -1
Clas Common Class Common (Nobivoting)
i I (b) Subsidiaries of bank
h ld ti 0 mgmiddot1rmpany
i (c) Otherbusillfss companies
I
TossLic Meser units
Toss II ILLC Member units
I
Timothy J Brown Storm Lake Iowa
NIA
President and Director
Member Member
5009 Shares 5967
1296 Shares 9460
None
1667
1667
John C Brown Spirit Lake Iowa
NIA
Secretary Treasurer and Director
Member Member
3385 Shares 4033
44 Shares 321
None
1667
1667
r
Report Item 4 - Rrincipal Shareholders Director Executive Officer of BanhlEolding Company
middotI
(3) Title or p9itiori with middotI I
bull1 (b) Subsidiaes of
holding 1qompany
Central Bank I I
middot1 ti
Jvlilford Holtljitgs Inc I
i
I
I
middotl 1 i
i
Timothy J Brown Storm Lake Iowa
President and Director
President and Director
John C Brown Spirit Lake Iowa
Executive ViceshyPresident Secretary and Director
Executive ViceshyPtesident Secretary and Director
- FR Y-6 Cover Page
- For Use By Tiered Holding Companies
- Report Item 1 Annual Report to Shareholders
- Report Item 2a Organization Chart
- Report Item 2b Domestic Branch Listing
- Report Item 3 Securities Holders
- Report Item 4 Insiders
-
r
Report Item 4 - Rrincipal Shareholders Director Executive Officer of BanhlEolding Company
middotI
(3) Title or p9itiori with middotI I
bull1 (b) Subsidiaes of
holding 1qompany
Central Bank I I
middot1 ti
Jvlilford Holtljitgs Inc I
i
I
I
middotl 1 i
i
Timothy J Brown Storm Lake Iowa
President and Director
President and Director
John C Brown Spirit Lake Iowa
Executive ViceshyPresident Secretary and Director
Executive ViceshyPtesident Secretary and Director
- FR Y-6 Cover Page
- For Use By Tiered Holding Companies
- Report Item 1 Annual Report to Shareholders
- Report Item 2a Organization Chart
- Report Item 2b Domestic Branch Listing
- Report Item 3 Securities Holders
- Report Item 4 Insiders
-