2016 Annual Report - Gorham Savings Bank

2016 Annual Report
Gorham Savings Bank Reaches New Heights
This past year will be remembered long into the future as a historic one! We achieved both
extraordinary milestones and financial results, and it didn’t happen by surprise. Rather, it was the
sustained pursuit of strategic objectives by a dedicated team of community bankers. As you will see
in this year’s report, the recent trends of growth and operational improvement have yielded impressive
results.
“ We achieved a
milestone year with
$1 billion in total
assets – thanks to a
dedicated team and
great customers.”
Most outstanding of all, the Bank surpassed the $1 BILLION level in total assets and had a record
net income of $6 million, a 40% increase over last year. A few of the contributing factors were:
• New Commercial Loans and Leases of $126 million, with a 12-month net growth of
$48 million, or 11%
• Residential Mortgage Originations in excess of $50 million
• Growth in Deposits, net of certificates of deposit, of $58 million
• Improved Net Interest Margin from 2.91% to 3.26%
While numbers are important, they don’t fully capture the impact of Gorham Savings Bank
in Southern Maine. Our Interactive Teller Machines (ITMs) provide both increased customer
convenience and extended hours of service, as highlighted on the next page. We expanded the
Bank’s “all things mobile” services to include Apple Pay and People Pay in 2015. This emphasizes our
commitment to early technology adoption, particularly in the fast-paced world of payment solutions.
As a mutual bank, our community reinvestment reached record levels. Contributions and support
to non-profits exceeded $338,000 with over 2,500 hours of community service volunteered by our
employees. Community banking is more than a name to us; it is a philosophy and an attitude. Our
culture of giving back, embraced by our employees, Directors, and Corporators alike, is fundamental
to our success.
While 2016 may have been one of the best in our 148-year history, we have already turned our focus
to 2017. We have significant momentum behind us, but we are constantly reminded of the challenges
ahead. Our expansion into Portland with the historic renovation of 1 India Street is now underway,
and we look forward to its opening later this year. This location will serve both the Bank and our
customers for many years to come, or at least until the next $1 billion of growth!
Chris Emmons
President and Chief Executive Officer
Letter from the Chairman
The fiscal year ending March 31, 2016, was an exceptional one for the Bank. Our forward-thinking approach,
combined with our employees’ dedication to customer service, has helped make it one of the best since our
founding in 1868. Exceeding $1 billion in assets is an important milestone for any community bank, but it is only
possible when there is strong engagement with customers and meaningful commitment to the community. We
are grateful for the trust and support we receive from all of our customers, which has led to the recent growth and
success of the Bank.
Daniel Willett
I am pleased to welcome Chris Claudio, CEO and co-founder of Winxnet, an IT
outsourcing and consulting firm with offices across New England and the Southeast,
to our Board of Directors. Chris has been a Corporator of the Bank since May of 2014
and brings a depth of technology expertise to the Board. His entrepreneurial outlook
combined with knowledge in strategy and consulting have already proven to be valuable
attributes in a number of areas of Board oversight.
Dan Willett, Chairman
GORHAM SAVINGS BANK 2016 ANNUAL REPORT
Chris Claudio
Banking Convenience
Remains a High Priority
Technology With
Personality
Gorham Savings Bank has long been dedicated to providing customers
with the latest in banking technology. This year, we continued that effort
with several new and convenient banking services.
Interactive Teller Machines (ITMs), first introduced in 2015, are now
located in Kennebunk, Gorham, and on Munjoy Hill in Portland and
truly deliver on the Bank’s promise to offer customers the benefits of
technological convenience without sacrificing personal service. A live video
link connects customers with a local, knowledgeable teller at our Customer
Service Center. This exciting new technology will also allow the Bank to
extend its footprint and hours to better serve our customers.
Our ability to provide services like Apple Pay, People Pay, Chip (EMV)
Cards, Mobile Banking, and Mobile Check Deposit demonstrates our
commitment to making banking more convenient. This suite of tech-savvy
products and services has something for both businesses and consumers,
and, to showcase how easy it is to use these services, we developed
a Technology Center at our main office in Gorham to provide hands-on
demonstrations and answer questions.
Universal Banking Associate Trease Mader
demonstrates the ease of using the ITM at
the Technology Center in Gorham.
GORHAMSAVINGSBANK.COM
“Saves for Charity”
Reaches Peak Performance
Supporting local non-profit organizations is a cornerstone of Gorham
Savings Bank. We are dedicated to working with community members
that share our values - partners who reflect what we stand for - integrity
and positive change.
Saves for Charity is a lively partnership we formed with the Portland
Pirates for their 2014-2015 season and renewed for 2015-2016.
Every time a Pirates goalie makes a save, we make a $10 donation
to The Barbara Bush Children’s Hospital. In the inaugural season, the
program raised over $10,000. Goalie Mike McKenna was so moved by
this, he made a significant personal donation as well. In the 2015-2016
season, we repeated the performance, raising another $10,000.
Gorham Savings Bank has enjoyed a long relationship with The Barbara
Bush Children’s Hospital, and we are grateful to the Portland Pirates for
teaming up with us to help children and their families.
Eric Andrews from Gorham Savings Bank presents the
2016 Saves for Charity check to Sarah Stern from
The Barbara Bush Children’s Hospital,
alongside former patient Kinsey and Portland Pirates
goalies Mike McKenna (left) and Sam Brittain (right)
Scoring Points for Portland’s Rising Reputation
Gorham Savings Bank’s partnership with the University of Maine to bring the NCAA Ice Breaker
Hockey Tournament to Portland created significant business opportunities for the region. By
sponsoring the 2015 Tournament, the Bank played a valuable part in showing a national audience
Maine’s strong business community. The Ice Breaker, the traditional start to the college hockey
season, brought talented teams and fans from across the country to Portland, fueling the local
economy by an estimated $2.5 million.
While the Bank’s sponsorship represented an investment in Greater Portland’s growth as a destination, the University of Maine and the
Bank are excited by the potential that the prestigious 2015 Tournament could earn the NCAA’s consideration for similar events in Portland.
University of Maine’s Seth Woodcock, Mascot Bananas
and Karlton Creech (far right) recognize Chris Emmons
and Gorham Savings Bank for support of the
2015 Ice Breaker Hockey Tournament.
The Ice Breaker Tournament Block Party brought hundreds of University of Maine
hockey fans together for some fun before the games.
GORHAM SAVINGS BANK 2016 ANNUAL REPORT
LaunchPad Prize Fuels
Innovators’ Lift Off
Maine has no shortage of innovative small businesses and
Gorham Savings Bank is committed to helping entrepreneurs
take their business to the next level. In its fourth year, Gorham
Savings Bank’s LaunchPad Competition continues to grow.
LaunchPad has contributed to putting Maine on the map as an
entrepreneur-friendly state. Over the last three years, more than
450 entrepreneurs have applied for LaunchPad, representing over
100 cities and towns across Maine, with nearly $100,000
in grants awarded.
Chris Emmons and Katie Bellerose (far right) present the
For many small businesses, the biggest hurdle can be start-up
Flowfold team, Charley Friedman, Nick Power, Max Harmon,
capital, so this year the Bank increased the prize to $50,000.
and Devin McNeill, with the 2015 Winning Trophy.
Maine business owners, creators, inventors, and entrepreneurs
compete by submitting a viable business proposal online. An independent panel of judges reviews the applications and selects a group
of five finalists. These five finalists will pitch their businesses at the live LaunchPad Competition on June 7, 2016.
The 2015 LaunchPad winner was Flowfold, chosen from nearly 100 applicants. Founded on Peaks Island, Flowfold designs, produces
and sells wallets, totes, and other everyday carry gear. The company’s mission is to build quality products designed for the pursuit of
everyday adventures. Flowfold’s additional goal of supporting the local workforce reflects what the LaunchPad program is all about—
helping Maine businesses help others.
Grand Trunk Building:
A Landmark of Economic Revival
Plans are underway for a complete restoration of the historic Grand Trunk
Railway building at 1 India Street in Portland. Located across from the Ocean
Gateway Terminal, this iconic building will soon receive the attention it deserves.
In fact, the building was named to the “Places in Peril” list by Greater
Portland Landmarks. The Bank is working closely with Developers
Collaborative in Portland to ensure the building is properly preserved.
Construction is slated to begin in spring 2016, with plans to fully occupy the
space by the end of the year. The first floor, while not becoming a traditional
branch, will offer consumer banking services with office space on the
upper floors.
Gorham Savings Bank is excited to be part of this important Portland
Rendering of 1 India Street
Waterfront history. The building, originally constructed in 1903, symbolized an
courtesy of Archetype Architects
important nexus for economic growth in the region. At the turn of the century,
Maine business leaders lobbied to build the railway here rather than Boston.
Located right in the heart of the Port of Portland—the most-northern port in America that doesn’t freeze in winter—the railway opened
points north to commerce. We hope to honor the vision of Maine’s economic leaders of the past by continuing to use the site to foster
economic vitality into the future.
GORHAMSAVINGSBANK.COM
Reaching our Community, Building our Economy
Supporting our community is one of our core principles, and we are pleased to be involved with
many local organizations. This past year, our employees demonstrated their community spirit by
giving more than 2,500 hours of their time to support charities that help our neighbors flourish.
Charitable Donations
Eric Andrews, Marie Morin
and Holly Pepin at the
Waterhouse Center in Kennebunk
United Way Day of Caring
Volunteer Sam Cunningham
More than 200 Winter Wishes
were collected for the Boys and
Girls Clubs in Portland
Junior Achievement volunteer
Samantha Croteau at Gorham Middle School
Employees visiting
The Barbara Bush Children’s
Hospital at Maine Medical Center
Rooftop Garden Takes Affordable
Housing to Next Level
We are always happy to see upturns in the local economy—and Gorham
Savings Bank is proud to contribute to the economic vitality of our region,
often in the form of construction loans. Of course, as Portland’s peninsula
becomes more popular, housing demand can outstrip supply, which is
why we support Avesta Housing, a not-for-profit organization committed
to providing affordable housing opportunities throughout Southern Maine.
Avesta is on the forefront of creating housing communities in which
people can help other people. In 2015, Avesta opened 409 Cumberland,
Portland’s new urban healthy living community. With a mix of 57
efficiency, one- and two-bedroom apartments, residents live within
walking distance to downtown shops, restaurants and amenities. What
sets this building apart is that residents can meet many of their healthy
living needs right at home.
Avesta’s 409 Cumberland encourages healthy living in the heart
of the city. Photo Credit: Benedict B. Walter, CWS Architects
A four-season greenhouse stands proud on the roof, alongside 1,600 square feet of raised garden beds, allowing residents to grow their
own vegetables year-round. They can also learn how to make the most of what they have grown in the building’s demonstration and
teaching kitchen, a welcoming shared space for residents with common passions.
GORHAM SAVINGS BANK 2016 ANNUAL REPORT
Gorham Bancorp, MHC and Subsidiaries
Summary Consolidated Statements of Condition (UNAUDITED)
March 31, 2016 and 2015
ASSETS
2016
Cash and due from banks
$
2015
22,101,807
$
16,774,429
Investment securities & federal funds sold
152,845,697
168,872,791
Total loans and leases
782,972,871
738,234,778
(7,303,695)
Less allowance for loan and lease losses
Net loans
Other assets
TOTAL ASSETS
(6,431,533)
775,669,176
731,803,245
53,811,639
52,304,751
$
1,004,428,319
$
969,755,216
$
648,466,381
$
596,486,327
LIABILITIES AND NET WORTH
Customer deposit accounts
Brokered deposits
159,233,891
152,369,646
Total borrowings
88,097,055
118,995,904
Other liabilities
13,683,604
13,492,094
Total liabilities
909,480,931
881,343,971
94,947,388
88,411,245
Net worth
TOTAL LIABILITIES AND NET WORTH
$
1,004,428,319
$
969,755,216
Standby letters of credit outstanding,
not included above
$
3,801,627
$
3,163,785
$
32,272,561
Summary Consolidated Statements of Income (UNAUDITED)
Years Ended March 31, 2016 and 2015
Total interest and dividend income
$
Total interest expense
34,037,856
4,182,338
6,121,184
29,855,518
26,151,377
1,000,000
800,000
28,855,518
25,351,377
5,703,420
5,758,406
302,382
(19,334)
26,844,421
25,668,684
Income before income taxes
8,016,899
5,421,765
Income tax expense
2,004,225
1,165,679
Net interest income
Provision for credit losses
Net interest income after provision for credit losses
Non-interest income
Gain (loss) on sale of securities
Non-interest expense
Net income
$
6,012,674
$
4,256,086
This statement has not been reviewed or confirmed for accuracy or relevance by the Federal Deposit Insurance Corporation.
GORHAMSAVINGSBANK.COM
Officers
Christopher W. Emmons | President and Chief Executive Officer
Daniel P. Hunter | Chief Operating Officer and Chief Financial Officer
Eric A. Andrews | Chief Banking Officer
Roger C. Levesque | EVP, Senior Loan Officer
Julie D. Brooks | SVP, Senior Risk Officer
Kimberly A. Donnelly | SVP, Director Business Banking
Matthew W. Early | SVP, Commercial Loan Officer
M. Daniel Hancock | SVP, Director of Deposit Strategies
Kevin M. Heatley | SVP, Director of Technology
Karl H. Suchecki | SVP, Commercial Loan Officer
Christine M. Weymouth | SVP, Director of Cash Management
Rebecca L. Winslow | SVP, Director of Retail Delivery
Todd M. Abbotoni | VP, Commercial Loan Officer
Beth C. Ahmida | VP, Commercial Loan Portfolio Officer
Toni A. Bailey | VP, Customer Service Center Manager
Jane W. S. Cirone | VP, Finance & Accounting Manager
Jeremy T. Clough | VP, Information Security Officer
Linda T. Cooper | VP, Senior Operations Manager
Lisa M. Cormier-Smith | VP, Director of Human Resources
Katherine E. Damon | VP, Regional Business Banking Officer
Peter J. Eley | VP, BSA/Security Officer
Gloria A. Fredette | VP, Loan Servicing Manager
Mark S. Girr | VP, Director of Marketing & Communications
Jody L. Hamilton | VP, Senior Regional Retail Manager
Lindsay Harris | VP, Commercial Loan Portfolio Officer
Lisa M. Hughes | VP, Regional Business Banking Officer
Directors
Daniel G. Willett, Chairman
Katherine B. Coster, Vice Chairman
Christopher L. Claudio
Dennis P. King
Joseph Malone
Jere G. Michelson
Richard M. Roderick
Paula D. Silsby
Bradford A. Wise
Honorary Corporators
John B. Alden*
Richard T. Barden
Richard A. Boyman
D. Brenda Caldwell*
Carroll T. Cutting
Geraldine A. Day
Harvey C. Donald
F. Paul Frinsko*
Natalie L. Hague
George V. Hall
Anne M. Haskell*
Horace Horton
John R. Huard, Sr.
Donald G. Marean
Eldon L. Morrison
Mary Pennell Nelson
John D. Phinney*
William W. Rust
Sally G. Vamvakias
Ralph B. Willis*
Herbert H. Woodbrey
*Honorary Directors
Corporators
Kathleen O. Kalicky | VP, Deposit Operations Manager
Ronald W. Knott | VP, Director of Consumer & Residential Lending
Jill M. LaFlamme | VP, Commercial Loan Portfolio Officer
Susan E. Laliberte | VP, Retail Loan Processing & Underwriting Manager
Marie L. Morin | VP, Senior Business Officer
Cynthia M. Nichols | VP, Commercial Loan Portfolio Officer
Melanie T. Nunan | VP, Mortgage Loan Officer
Kelly M. O’Donnell | VP, Core Systems & Emerging Payments Officer
Matthew G. Palmer | VP, Credit Administration & Collections Manager
Holly A. Pepin | VP, Regional Business Banking Officer
Frederick G. Proctor | VP, Commercial Loan Officer
Sue E. Strout | VP, Senior Regional Retail Manager
Julie Landry Viola | VP, Business Banking Lending Manager
Katie L. Bellerose | AVP, Credit Analyst
Jessica J. Burbank | AVP, Branch Manager
Martha L. Conley | AVP, Senior Financial Analyst
Troy A. Hendrickson | AVP, Regional Business Banking Officer
Julia B. Hubbard | AVP, Payroll & Benefits Coordinator
Donald G. Joly | AVP, Network Administrator II
Alden L. Joy | AVP, General Services Manager
Kim M. Kenney | AVP, Marketing & Communications
Troy R. Levesque | AVP, Recruitment Officer
Tracey L. Sardella | AVP, Compliance Officer
Jason N. Straetz | AVP, Credit Analyst II
Lisa M. Thomas | AVP, Employee Development Officer
David J. Abbott
Mark Adams
Timothy P. Agnew
Richard Berman
Tom Biegel
Leo W.C. Binette
Sheri Boulos
Michael Boyson
Samuel B. Broaddus
Joseph Bruno
Steve Campbell
Christopher Claudio
Russell J. Collett
Matthew Cook
Philip A. Cook, Jr.
Katherine B. Coster
Andrew D. Couch
Stephen Crockett
Albert R. Curran
Mark Curtis
Craig N. Denekas
Steven DiMillo
Susan J. Doliner
Robert H. Dorr
Christopher W. Emmons
Donald Esty, Jr.
Fred Forsley
Katie Fullam Harris
Kenneth Grondin
Charles F. Hahn
Barry J. Hobbins
Janice A. Jongerden
Dennis P. King
Kenneth M. Lefebvre
Renee J. Lewis
Burleigh H. Loveitt
Joseph Malone
Anne M. McBrady
Daniel McCormack
Edward S. McKersie
Bradley C. McCurtain
Peter L. Michaud
Thimi Mina
Jere G. Michelson
John P. Nolan
Brian H. Noyes
Daniel J. O’Halloran
Timothy O’Neill
Gregory R. Palmer
Michael J. Phinney
Sheila Phinney-Levine
Charlie Poole
Malcolm Poole
Ford Reiche
M. Parker Roberts, III
Richard M. Roderick
Linda F. Sanborn
Timothy W. Seavey
Paula D. Silsby
Michael Q. Simonds
Jonathan Smith
Angelo Sotiropoulos
Walter P. Stinson
Lisa Toner
Dana Totman
Christopher M. Tyll
David E. Warren
Anna Wells
Daniel G. Willett
Jeffrey S. Willis
Bradford A. Wise
Nicole Witherbee
Member FDIC