2019 Journal of Community Bank Case Studies

Utah Valley University

THIRD PLACE:

Part I: Financial Analysis A. Earnings Performance The last decade, and particularly the last few years, the State of Utah has been characterized by strong growth, development, and economic prosperity (Lee). People’s Intermountain Bank has taken advantage of this trend and has been able to further capitalize on the economic strength of its communities through experienced strategy and excellent capital management. This in turn has consistently produced impressive earnings. 2018 was a record-breaking year for this century-old bank. Net income increased from $19.8 million in 2017 to $40.6 million in 2018, an increase of nearly 105% (Federal Financial Institutions Examination Council [FFIEC]). This increase was largely due to two factors: a merger and an acquisition at the end of 2017 coupled with financial relief from the tax reform act signed on December 22, 2017. In 2015, People’s Utah Bancorp, the holding company for People’s Intermountain Bank of which Bank of American Fork is a division, had an IPO that raised nearly $40 million. This increase in capital allowed for one merger and an acquisition of seven branches. The merger of Town and Country Bank in southern Utah, the nation’s third fastest growing economy, was completed

Net Income (In Millions)

$45.0 $40.0 $35.0 $30.0 $25.0 $20.0 $15.0 $10.0

$40.6

$24.0

$20.0

$19.8

$13.5

$12.3

Net Income (In Millions)

$5.0 $0.0

2013

2014

2015

2016

2017

2018

Year

in November of 2017 (Perlich). In October of 2017, just prior to the closing of the merger, People’s Intermountain Bank announced the acquisition of seven Utah branches of Banner Bank. These aggressive moves by People’s Intermountain Bank were strategic as they

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