(800) 479-2196 · FRANKLIN PARK WEST 1 Franklin Park West, St. Albans, VT GEORGIA ... 10 Annual R...

Enosburg Falls

Essex

Georgia

Saint Albans

Swanton

(800) 479-2196 www.ptcvt.com

Annual Report I 2016

We’ve been building relationships in your community since 1886.

Table of Contents

PRESIDENT/CEO MESSAGE 1

INDEPENDENT AUDITOR’S REPORT 4-5

FINANCIAL STATEMENTS

Balance Sheets 6

Statements of Income 7

Statements of Comprehensive Income 8

Statements of Changes in Shareholders’ Equity 9

Statements of Cash Flows 10-11

Notes to Financial Statements 12-39


You can trust Peoples for all of your banking needs and advice.

Commercial – Construction – Home Equity – Mortgages – Personal – Vehicle

Branch and ATM Locations

MAIN OFFICE 25 Kingman Street, St. Albans, VT

ENOSBURG FALLS 140 Main Street, Enosburg Falls, VT

ESSEX TOWN CENTER 1 Carmichael Street, Essex, VT

FRANKLIN PARK WEST 1 Franklin Park West, St. Albans, VT

GEORGIA 1127 Ethan Allen Highway, Georgia, VT

SWANTON 123 First Street, Swanton, VT

CUSTOMER SERVICE Local: (802) 524-2196 • Toll Free: (800) 479-2196 Telephone Banking: (802) 524-5054 (800) 203-9575


March 12, 2017

Dear Peoples Trust Company Shareholder,

Enclosed please find a copy of the 2016 Peoples Trust Company Audited Financial Report. 2016 was a year of sweeping and significant change on both a National and State level including a new President, new Governor and new leadership in virtually every significant position in the Vermont Legislature. We are encouraged by the prospects of an improving economy, but remain cautiously optimistic of what the implications of the aforementioned changes in leadership mean for us as a Country, State and Community Bank. As you are all aware, the bank also saw change with the addition of four new Board of Directors at the beginning of 2016 and we have been pleased with their contributions. Peoples Trust Company experienced improvement on many levels this past year including two key areas, earnings and asset quality, while at the same time continuing to improve on our customer delivery channels.

Net income for the year ending December 31, 2016 was $1,476,731 compared to $1,187,351 for the same time period in 2015, or a 24.3% increase in earnings. A portion of this increase was due to events that will not necessarily carry over into subsequent years, such as a zero funding of the loan loss reserve and recoveries on previously charged off loan relationships. Non-performing loans decreased again in 2016 and management is pleased with the progress we have made in this area. Over the past few years, we have managed to significantly reduce the number of non-performing loans, while growing or maintaining the owned loan portfolio.

Total Assets of the company saw a decrease in 2016 and the owned loan portfolio remained relatively flat with a marginal decrease to end 2016. Total assets decreased by $797,618 to close at $254,305,833 compared to $255,103,451 on December 31, 2015. Total loans decreased by $88,811 to close at $146,824,100 compared to $146,912,611 on December 31, 2015. Peoples Trust Company saw an increase in the bank’s investor loan portfolio as the interest rate environment for much of the year provided for a steady pipeline of high quality residential loan activity. Please review the accompanying pages for further detail and please don’t hesitate to call or stop in should you have any questions.

In a continued strategy to enhance shareholder value, the bank retired 8,686 outstanding shares of Peoples Trust Company stock in 2016 to arrive at 617,648 shares outstanding at year end. Book value of PPAL stock increased in 2016 to $51.09 per share from $49.73 per share in 2015. The bank also saw an increase in earnings per share in 2016 of $2.37 per share compared to $1.84 per share in 2015. Peoples Trust Company continues to maintain capital ratios that easily exceed the FDIC minimum to be considered a well-capitalized institution.

We remained dedicated to enhancing shareholder value, and furthering our mission to profitably meet the financial needs of our community, its businesses and our neighbors. I feel exceptionally privileged to work for this great company and with such a talent group of employees.

On behalf of the Board of Directors, staff and all of us that make up the Peoples Trust Company family, I want to thank you for the appreciation of the mission of PTC. We strive to achieve this each and every day for the betterment of our community, employees and shareholders.

Thank you for your investment in the Bank with a Heart!

Sincerely,

Thomas J. GallagherPresident/CEOPeoples Trust Company



PEOPLES TRUST COMPANY OF ST. ALBANS

FINANCIAL REPORT

DECEMBER 31, 2016

INDEPENDENT AUDITOR’S REPORT

4

INDEPENDENT AUDITOR’S REPORT continued

5


BALANCE SHEETS December 31, 2016 & 2015

ASSETS 2016 2015

LIABILITIES AND SHAREHOLDERS’ EQUITY

See notes to financial statements.


STATEMENTS OF INCOME Years Ended December 31, 2016 & 2015

2016 2015



STATEMENTS OF COMPREHENSIVE INCOME Years Ended December 31, 2016 & 2015

2016 2015



STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY Years Ended December 31, 2016 & 2015



STATEMENTS OF CASH FLOWS Years Ended December 31, 2016 & 2015

CASH FLOWS FROM OPERATING ACTIVITIES 2016 2015

CASH FLOWS FROM INVESTING ACTIVITIES



STATEMENTS OF CASH FLOWS continued Years Ended December 31, 2016 & 2015

CASH FLOWS FROM FINANCING ACTIVITIES 2016 2015

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION

SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING ANDFINANCING ACTIVITIES



NOTES TO FINANCIAL STATEMENTS


NOTES TO FINANCIAL STATEMENTS continued



2016 2015



2016 2015

2016 2015

2016 2015



2016 2015



2016



2015



At Peoples Trust Company, we are committedto providing you that extra edge in business.

The bank with a heart is serious about your success.

Board of DirectorsRobert A. Cioffi, Chairman of the Board of Directors of Peoples Trust Company of St. Albans since 1990 Retired Owner, Cioffi Real Estate

John T. Gallagher, Member of Board of Directors of Peoples Trust Company of St. Albans since 1991 Owner and President, Gallagher Inc.

Donald G. Poirier, Secretary and Member of Board of Directors of Peoples Trust Company of St. Albans since 1996 Retired Executive Vice President, Peoples Trust Company of St. Albans

Mark E. Lareau, Member of Board of Directors of Peoples Trust Company of St. Albans since 2001 Owner, Lareau Appraisal Service

Linda M. LeBlanc, Member of Board of Directors of Peoples Trust Company of St. Albans since 2005 Senior Executive Officer/Chief Operations Officer of Peoples Trust Company of St. Albans

Leon J. Berthiaume, Member of Board of Directors of Peoples Trust Company of St. Albans since 2008 CEO, St. Albans Cooperative Creamery, Inc.

Frank J. Cioffi, Member of Board of Directors of Peoples Trust Company of St. Albans since 2009 President, GBIC (Greater Burlington Industrial Corp.)

Thomas J. Gallagher, Member of Board of Directors of Peoples Trust Company of St. Albans since 2011 President/CEO of Peoples Trust Company of St. Albans

John P. Casavant, Member of Board of Directors of Peoples Trust Company 2016 Part owner and Vice President at NFP, Inc. (formerly Hackett, Valine and McDonald)

David J. Handy, Member of Board of Directors of Peoples Trust Company 2016 Co-owner of Handy Buick, Cadillac, GMC, Inc.

Claire J. Manahan, Member of Board of Directors of Peoples Trust Company 2016 Retired

Gordon A. Winters, Member of Board of Directors of Peoples Trust Company 2016 Owner/President of Swanton Lumber and ACE Hardware stores in Milton, Jericho, St. Albans, VT and Champlain, NY

Richard C. Read and Marc J. Reynolds, Directors, Emeritus

Executive OfficersThomas J. Gallagher President/CEOLinda M. LeBlanc Senior Executive Vice President/COO

Other OfficersAaron A. Reynolds Senior Vice President, CFOMichael J. Elmore Senior Vice President, CIOAngela M. Poirier Senior Vice President, CLSMaureen J. Toof Senior Vice PresidentCarol C. Spillane Senior Vice PresidentLloyd W. Larrow Senior Vice PresidentDale E. Fisher Senior Vice President

Lyle D. Poirier Vice PresidentStacey Cauller Vice PresidentKerry M. Deschamps Vice PresidentAnne E. Gosselin Vice PresidentDanielle E. Manahan Vice PresidentJanice L. LaRocque Vice President, BSA

(800) 479-2196 · FRANKLIN PARK WEST 1 Franklin Park West, St. Albans, VT GEORGIA ... 10 Annual R...

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