Message from the President
Our Legacy is Who We ARE – Our Future is WHAT WE ARE Defining
For Citizens Trust Bank, serving our clients means connecting with people. It means engaging at a deeper level than simply doing business or handling transactions. We are committed to leading and strengthening our relationships and serving the needs of others. For us, the best way to accomplish this is earning trust and investing in these relationships to grow our Company.
Citizens Trust Bank built its reputation by remaining firmly rooted and accessible in the communities we serve. We combined trust, loyalty and personalized relationship banking with the delivery of high-touch service and life focused financial solutions. Our rich history and legacy have provided us the foundation and the inspiration to innovate and seek ways to continue to drive shareholder value.
Now, more than ever, we know that innovation paired with human interaction enables us to not only provide financial empowerment and guidance on a grander scale but also sets us apart in the marketplace. By increasing our visibility and footprint in new as well as existing markets we are attracting, building, and maintaining a growing customer base and a more sustainable future for
our internal and external stakeholders. We launched our 95th anniversary year by remaining purposefully focused on building our brand with a deliberate charge toward the future. To make us even more agile to face and optimize new opportunities, we focused on four core strategic priorities:
Bringing the Brand to Life;
Defending and Growing the Business;
Mobilizing the Brand across All Platforms, and
Driving Organizational Excellence.
As you will learn throughout this message, the successful implementation of our initiatives revealed our ability to execute and utilize technology to be responsive to our clients and grow our business. Serving our clients means connecting with people.
2016 Financial Highlights 2016 proved to be a very successful year for our Company from many perspectives and we couldn’t be more excited about our future. The significant milestones we reached will go down in history as part of our legacy. We experienced growth in every major sector of our business. Our strong performance is attributed to our consistent focus on 1) remaining client-centered in everything we do 2) optimizing our balance sheet to enhance returns and 3) improving efficiency in how we deliver service to our clients. Over the past several years this consistent focus has:
- Generated growth in diluted EPS of 71% over the last four years
- Created a more efficient business with operational cost reductions of 4% over prior year and almost 12% over the last four years
- Provided approximately 29% growth in income before income taxes over 2015
- Resulted in 2% growth in assets and 3% growth in deposits over prior year
- Generated net loan growth of approximately 13% over the prior year, reflecting growth in every segment of our lending division
- Produced growth in mortgage loan originations of 241% over 2015
- Resulted in historic asset quality metrics indicating significant reduction in the risk profile of our portfolio
- Allowed us to retire over 37% of the outstanding TARP funds with an anticipation of retiring the remaining portion before the interest rate resets to 9%. We have appropriately planned for this event and will remain well capitalized in accordance with regulatory guidelines
Though we are extremely proud of these results, we will continue to challenge ourselves to get better and evolve our business across all platforms to create value for our clients and our shareholders. We will continue to seek expansion organically as well as pursue market opportunities. As was our focus in 2016, our four core strategic priorities will be our guiding standard.
Defending And Growing The Business – focus on expansion of our markets and seize emerging
Opportunities With a deeper understanding of our clients’ needs and a recognition of changing market trends, our investment in technology over the past several years delivered returns. Through technology, we expanded our reach, deepened our relationship with current clients and gained a historical number of new clients, bringing our brand to life across the nation. The community around us was vibrant and engaging — and we were ready to thrive in it.
Further, Citizens Trust Bank increased its presence through involvement in community events and ongoing social media engagement. Our real time interaction created 2016 proved to be a very successful year for our Company from many perspectives and we couldn’t be more excited about our future. opportunity to build relationships and provide valued solutions. We also had a bit of good fortune thanks to the power of social media. After an international entertainer touted the benefits of community banking, the floodgates of new opportunity opened.
The social media buzz created a new-found awareness of the Citizens Trust Bank brand with a diverse demographic of people who found a direct correlation to positive relationships with their money, their community and realizing their dreams of creating generational wealth. The direct response was phenomenal. The bank was positioned to increase its following and engagement with a broader market, including millennials. Our deposit account relationships alone grew six times its normal rate and 33% of the new relationships acquired were through our online portal.
To engage more followers we augmented this social media success with our own hashtags (#win/win relationships, #IamCTB, #growwithus, and #bankwithus). We are thankful for all of our clients and extend a warm welcome to our new clients. We promise to work hard to add value to their way of life.
Bringing The Brand To Life – expanded community and digital presence
With the demographic trend shifting to younger prospects, we capitalized on this emerging market and launched our Next Generation Advisory Board (NGAB). A new, younger set of thought leaders, the NGAB was comprised of thirteen young and inspiring Atlanta business professionals. They serve in a collaborative capacity to help us explore innovative and strategic ways to offer financial solutions and build wealth to a changing and diverse demographic.
The partnership with our advisory board also expanded our reach and deepened our impact through alliances. By utilizing social media and other outlet channels, they have been instrumental in creating additional momentum to help build buzz on social media, get the word out, and extend the Citizen Trust Bank brand message amongst younger audiences.
Throughout the year, we also explored ways to establish relationships with grassroots affinity and community organizations. By aligning with these market-specific groups, we were able to benefit from their established networks, expertise, and connections with emerging markets within the community. In addition, our support of these community organizations and their events provided an opportunity for the local organizations and social media influencers to experience Citizens Trust Bank firsthand, further positioning us as the community bank of choice.
Mobilizing the Brand Across All Platforms
Advances in technology and the overall mobility of people continue to change the dynamics of the banking landscape. Ensuring there is always high touch along with high tech, we will continue our investment in technology to simplify our operating environment, increase efficiency, and bring convenience to the client experience across our footprint. With consumer habits changing at an unprecedented rate, the changing needs of our clients will always remain a key driver of our business. The prevalence of smart devices along with higher-than-ever client expectations compelled us to reinvent our online experience. In 2016, Citizens Trust Bank completely overhauled its online presence. The fresh layout offers responsive navigation with a high degree of user-friendliness. Through a responsive design, the important Citizens Trust Bank digital information is accessed regardless of the user’s device, i.e. PC, smartphone or tablet.
Our banking options give our clients the flexibility to bank how, when and where they find most convenient. They can open accounts and conduct banking transactions without ever having to make a branch visit. Whether clients encounter Citizens Trust Bank in-person, via www.ctbconnect.com, our mobile app, or by phone, we understand the importance of being responsive and creating a positive experience. This optionality in service delivery also allows us to expand our markets without the need for an extensive physical branch network.
Through ctbconnect.com, we hosted 1 million site visits which are a Company record. We offered newly piloted mortgage product pages, which includes an online mortgage application and readily available financial calculators to assist in making well-informed financial decisions. Our enhancements are producing results. We experienced a 241% increase in mortgage loan originations over the prior year.
As our clients increasingly move online, we are quickly transforming our business. The focus on digitization will help ensure that our Company remains relevant, our clients remain satisfied and our shareholders are confident in our strategy to create value. Our online presence – We are deeply committed to the continued support of our communities through lending, investments, and service. These partnerships are proving to be a win/win for the community. We are taking steps to build a top-performing bank by delivering the best possible customer experience.
Driving Organizational Excellence
Without question, the results we’ve achieved in the past and the progress we hope to make in the future will not be possible without the efforts of our teammates. Our team is made up of banking experts who possess a solid set of values. They foster a genuine passion with which they do their job and an absolute determination to evolve and improve our Company.
They are committed to being an organization of excellence. They challenge each other every day to seek ways to explore and innovate to make our Company better. They have a keen focus on finding ways to deliver excellent service to our internal and external clients more efficiently, a keen focus on finding ways to deliver faster service and a keen focus on solid, consistent execution of our strategic initiatives.
During 2016, our teammates serviced over 11,000 new account applications in a five-month time frame. This provided a deposit growth over 10 times our annual growth rate. To board such a significant level of unexpected growth in such a short period of time, our teammates across the organization rallied the effort. The execution was well beyond excellent. This is an example of what we continue to strive for in every aspect of our business. Our competitive advantage…depends on it.
Lastly, we celebrated our 95th anniversary in 2016. This is a significant milestone of which we are extremely proud. I would like to thank our clients and community for supporting us all these years and for putting their trust in us, our board of directors for their encouragement to reach new milestones and our teammates who created the successes that we are reporting on their efforts and dedication. To our shareholders, thank you for partnering with us by investing in our Company.
We commit to you that we will continuously strive to build a better bank that will support our values, serve our clients and provide you a return. We are looking forward to 2017 and the exciting opportunities it will bring.