2019 ANNUAL REPORT Table of Contents Year in Review ......................................................................................................... 4 For the Love of People and Community ....................................................................... 5 Letter to Shareholders ............................................................................................... 7 Financial Review .................................................................................................... 12 Five–Year Consolidated Average Balance Sheet ......................................................... 15 Five–Year Consolidated Summary of Operations ........................................................ 16 Financial Data of Affiliate Banks .............................................................................. 17 Independent Auditor's Report................................................................................... 18 History of Central Bancompany ............................................................................... 67 Directors and Senior Leadership of Central Bancompany ............................................ 69 Affiliates of Central Bancompany ............................................................................. 70 2 Financial Highlights Year in Review CENTRAL BANCOMPANY, INC. AND SUBSIDIARIES TOTAL AVERAGE ASSETS (in billions) TOTAL AVERAGE DEPOSITS (in billions) 14,000 $13,635 11,000 $10,321 For the Year 2019 2018 $12,713 $12,694 13,000 10,000 $9,668 $9,660 Interest Income $538,614,000 470,009,000 $12,245 $9,189 12,000 9,000 $8,726 Interest Expense 73,595,000 51,479,000 $11,655 Net Interest Income 465,019,000 418,530,000 11,000 8,000 0 0 Provision for Loan Losses 14,025,000 15,880,000 GROWTH 2015 2016 2017 2018 2019 2015 2016 2017 2018 2019 Non-Interest Income 190,262,000 162,487,000 EARNINGS PER SHARE BOOK VALUE PER SHARE Non-Interest Expense 368,928,000 339,013,000 $47.38 $480.46 Income Taxes 62,685,000 48,548,000 47 490 44 $40.13 460 $439.97 41 Net Income 209,643,000 177,576,000 38 430 $403.43 35 $32.10 400 $388.65 $30.97 32 370 $362.78 Average Daily Assets 13,635,347,000 12,693,790,000 29 $27.45 26 340 Average Daily Deposits 10,321,184,000 9,660,186,000 0 0 Average Daily Loans 8,670,796,000 8,263,526,000 2015 2016 2017 2018 2019 2015 2016 2017 2018 2019 NET INCOME (in millions) ANNUAL DIVIDENDS PER SHARE At Year End $209.6 $8.50 Total Assets $14,960,940,000 13,172,605,000 8.00 200.0 $7.00 7.00 Investment Securities 3,633,572,000 2,893,864,000 190.0 $6.22 $177.6 180.0 6.00 Loans 9,475,093,000 8,328,530,000 170.0 5.00 $4.50 160.0 Deposits 11,566,917,000 10,115,151,000 4.00 150.0 $142.0 $3.30 3.00 140.0 $137.0 130.0 $121.5 2.00 PERFORMANCE Stockholders’ Equity 2,126,063,000 1,946,883,000 1.00 0 0 Number of Outstanding Shares 4,425,085 4,425,085 2015 2016 2017 2018 2019 2015 2016 2017 2018 2019 Per Share Net Income $47.38 40.13 EFFICIENCY RATIO (%) Dividends 8.50 7.00 64 % 62.7 % Stockholders’ Equity 480.46 439.97 62 % 59.8 % 60 % 59.3 % 58.0 % 58 % 56.0 % 56 % 54 % 0 2015 2016 2017 2018 2019 EFFICIENCY 3 4 “Before we could assess the damage to our communities, classes, one-on-one coaching, and outreach efforts to several Central Bank employees reached out to me open the doors of the bank to the entire community. with a plan and an offer of assistance,” said Ann Bax, Employees teach the classes, which from day one of President of the United Way of Central Missouri. “In its launch was well received and filled within hours. any time of need, Central Bank’s culture allows its This validates the need for financial education that employees to roll up their sleeves and help during the improves lives. moments of devastation.” “We have always provided extensive financial education,” said Joe Henderson, President of Central Bank of Boone County. “But we wanted to do more, primarily by reaching more people. Creating this program allows us to dedicate specific resources to help people understand how to use their money effectively and find ways to make it go further. We know that educational programs work best when they happen in places easily accessed. We will take this education anywhere our community needs us, whether that is a church basement, a high school classroom, a community center, or business lunchroom.” Our commitment to the communities we serve is true, even if it is just one individual who is affected Our commitment to the communities we serve is by personal tragedy. When a young man visited a limitless. In 2019 alone, our employees spent 27,500 local branch in Springfield, MO, after the passing plus hours in the community at more than 2,023 of his wife, he was overwhelmed with sadness and organizations in our footprint. From building homes in For the Love of People and Community grief. Our employee was determined to help in any the greater Kansas City area, to providing mentorship way possible. She worked to help facilitate his life to children in need in Branson, MO, Central Bank insurance he had through the bank. And, in that is proud to serve our communities by volunteering at We’re not just in the banking business – we’re in the unpredictable. Fast forward to this year, 2019 brought moment, there was an instance of hope, as he was local events, chairing committees, organizing local people business. From our humble beginnings in 1902, devastation to many of our local communities due to grateful for the unexpected funds to assist with the campaigns, funding events, and serving on boards. it’s always been about people. The foundation for the severe weather by tornadoes and flooding. When the pile of never-ending medical bills. The most significant piece of our culture is people company’s culture of people-first manifested itself in community needed us, our employees showed up. first – our employees are integral to the success of our 1933. It was the Great Depression, and people were And they keep showing up, day after day. “Through our company’s culture and leadership, we collective communities. struggling to make a living. The state of Missouri, want all of our employees to be people-first,” said Our commitment to the collective communities right in our back yard, was no stranger to the struggle. Joselyn Baldner, Executive Vice President of Central The Central Bank culture has always been, and we serve is extensive. When an EF3 tornado ripped The state was nearly $4 million short in revenue and Bank of the Ozarks. “To bring even a little light to always will be, community-minded. Whether it is through Eldon and Jefferson City, MO, in May unable to pay state employees, their wages totaling our customers’ day, whether it be through a product something that impacts an entire community, like a 2019, our employees lent hearts and hands. Without $300,000. To ensure the state did not fall victim to or service, or just a smile, our culture of caring and tornado, one individual person, or developing a new hesitation, countless volunteers and Central Bank the Great Depression, the Central Missouri Trust giving really shines through.” community-wide program for financial literacy, our Company made $1 million available for state worker families swarmed Capitol Avenue with food, water, and employees can be found giving back. We are proud compensation and financial aid. This ultimately necessary supplies to victims who had lost their homes, Our employees are not only serving the community of our employees. shaped the future for the state of Missouri and the access to basic needs, and personal belongings. When during moments of devastation and grief. Our employees people who lived in our footprint. the United Way of Central Missouri expressed their are there at every moment. In 2019, Central Bank of To watch a video about need for volunteers, our employees worked extra hard Boone County launched ProsperU, an educational our community service Central Bank doesn’t just do banking better, we also to complete their day-to-day tasks while volunteering program designed to empower the people of the commitments, use your make the community better. Our employees are there at the United Way office assisting with victim requests, community to achieve financial success. A product smartphone camera to for the moments that matter. These moments are not donor responses, and volunteer coordination. of the bank’s strategic plan to solidify its community scan this code. always happy and exciting, but also the terrifying and bank image, the program combines on and off-site 5 6 To Our Shareholders Central Bancompany has a long history of strong Credit Quality financial performance, and 2019 was another great All of our key credit risk indicators remain very strong I am pleased to announce that 2019 was another record year for our company with strong year. Some key financial highlights for 2019 were: and improved performance across all key metrics. Once again, Central Bancompany and favorable compared to industry peers: has delivered record core net income and earnings per share. Our success this year • 18.1% increase in net income from $177.6 mil- • Our year-end allowance for loan losses grew from was driven by our ability to grow organically in our core markets, strong financial lion in 2018 to $209.6 million in 2019. Included $128 million at the end of 2018 to $133 million at management, and two strategic acquisitions in new communities. in 2019 is a gain on securities of $7.9 million the end of 2019, and our ratio of allowance to total unlike in 2018 when there was a securities loss loans was 1.40% of loans compared to 1.53% at the We were rewarded for our efforts by being named one of the “Best Banks of $5.5 million. end of 2018. The decrease in our reserve to total in America” by Forbes Magazine.