JASPER – German American Bancorp, Inc. (Nasdaq: GABC) reported record annual earnings of $84.1million, or $3.17 per share, for the year-end 2021, representing the 12th consecutive year, that the Company has reported record annual earnings. This level of annual earnings performance resulted in a 13.1% return on average shareholders’ equity and a 16.4% return on average tangible common equity in 2021, marking the 17th consecutive fiscal year in which the Company has delivered a double-digit return on shareholders’ equity.
The Company also announced the declaration of a 10% increase in its quarterly cash dividend, marking the 10th consecutive year of increased cash dividends, and the approval of a new share repurchase plan for up to one million GABC shares. 2021 year-to-date record net income represented an increase of $21.9 million, or approximately 35% on a per-share basis, from the prior year’s annual earnings of $62.2 million, or $2.34 per share. Virtually every category of income and expenses showed improvement in 2021, as compared to 2020, with the exception of an elevated level on the non-interest expense, which was attributable to non-recurring expenses associated with various initiatives management undertook in 2021 to better position the Company going forward in light of the current operating environment.
Fourth-quarter 2021 net income of $19.3 million, or $0.73 per share, represented a decline of $1.6 million, or approximately 8% on a per-share basis, from fourth-quarter 2020 net income of $20.9 million, or $0.79 per share. On a quarter-over-quarter comparison, the earnings differential was primarily due to a reduced level of net interest income attributable to a lower level of fee income from PPP loans, as that program was in its final stages during the fourth quarter of 2021. The elevated level of non-interest expense was attributable to the previously noted non-recurring expenses associated with various management initiatives in 2021.
The Company also announced that its Board has approved a new share repurchase plan authorizing the repurchase of one million shares, or approximately 4% of the Company’s total common shares outstanding as of December 31, 2021. Stock repurchases are expected to be made from time to time on the open market or in privately negotiated transactions, subject to applicable securities law. The plan does not obligate the Company to repurchase any specific dollar amount or number of shares.
Additionally, the Company announced a 10% increase in its regular quarterly cash dividend, as its Board of Directors declared a regular quarterly cash dividend of $0.23 per share, which will be payable on February 20, 2022, to shareholders of record as of February 10, 2022.
Mark A. Schroeder, German American’s Executive Chairman, stated, “We were extremely pleased with the annual operating results our Company was able to post in 2021, continuing our decades-long trend of exceptional financial performance, in the face of what was obviously a continued challenging but improving operating environment. Perhaps more importantly, we also took steps in 2021 to better position the Company for future success. While we expect 2022 to continue to be a very challenging year, we put in place various initiatives that will not only mitigate the impact of these challenges in the current year but will position German American to be in an even stronger position when the general economy returns to a more normalized environment in the coming years.”
D. Neil Dauby, German American’s President & CEO, commenting on the Company’s initiatives for future success undertaken in 2021, stated, “We are excited to build upon our history of strong financial performance and even more excited for the future growth potential in connection with the closing of our acquisition of Citizens Union Bancorp of Shelbyville, Kentucky on January 1, 2022. The acquisition allows us to significantly build upon our presence in the fast-growing Greater Louisville market area. This acquisition, along with our anticipated first-quarter opening of a loan production office in the Greater Indianapolis area (Greenwood, Indiana) and our completed optimization and continuous improvement initiatives in 2021, will provide us with opportunities to enhance future balance sheets growth and operating performance.”
Balance Sheet Highlights
Total assets for the Company totaled $5.609 billion on December 31, 2021, representing an increase of $132.8 million, or 10% on an annualized basis, compared with September 30, 2021, and an increase of $631.0 million, or 13%, compared with year-end 2020. The increase in total assets at year-end 2021 compared with September 30, 2021, and December 31, 2020, has been largely driven by significant growth in deposits.
Securities available for sale increased by $193.4 million as of December 31, 2021, compared with September 30, 2021, and increased $671.8 million compared with December 31, 2020. The increase in the securities portfolio in both the fourth quarter of 2021 and over the past year was the result of increased levels of deposits and cash flows from the forgiveness of loans made under the Paycheck Protection Program (“PPP”).
As previously disclosed, in March 2021, the Company commenced an operating optimization plan, pursuant to which its banking subsidiary, German American Bank, would consolidate seven branch offices and implement various staff reductions during 2021. In making its decision to consolidate these branches, which were generally integrated with other nearby bank branches, the Company considered, among other factors, the operating costs of the branches, certain physical limitations impacting the bank facilities, and their proximity to other branch locations. In addition, the Company’s evaluation of the branch consolidations and the reductions in staff also took into consideration the numbers and types of transactions being conducted by its customers and the increased usage of online and mobile banking. Also as part of the operating optimization plan, in September 2021, German American Bank sold its two branches located in Lexington, Kentucky to The Home Savings and Loan Company of Kenton, Ohio (“HSLC”). HSLC assumed approximately $17.6 million in total deposits and purchased approximately $17.8 million in total loans as part of the sale. December 31, 2021, total loans declined $5.1 million, or less than 1% on an annualized basis, compared with September 30, 2021, and declined $84.1 million, or 3%, compared with December 31, 2020. The decline in total loans at December 31, 2021, compared with September 30, 2021, and year-end 2020 was primarily due to a decrease in PPP loans. PPP loans, net of deferred fees, totaled $19.5 million ($20.3 million principal balance and $0.8 million of remaining net deferred fees) on December 31, 2021, compared with $68.0 million on September 30, 2021, and $182.0 million on December 31, 2020.
Excluding PPP loans, total loans increased $43.5 million, or 6% on an annualized basis, on December 31, 2021, compared with September 30, 2021, and $86.8 million, or 3%, compared with year-end 2020. Commercial and industrial loans increased approximately $30.2 million, or 24% on an annualized basis, during the fourth quarter of 2021 compared with September 30, 2021, commercial real estate loans increased $2.2 million, or 1% on an annualized basis, and agricultural loans increased $8.8 million, or 10% on an annualized basis (excluding PPP loans). The increase during the fourth quarter of 2021 in commercial and industrial loans as well as agricultural loans was driven by increased line of credit utilization. During the fourth quarter of 2021 compared with September 30, 2021, retail loans increased by $2.3 million, or 2% on an annualized basis.
In response to requests from borrowers who had experienced pandemic-related business or personal cash flow interruptions, and in accordance with regulatory guidance, the Company began making short-term loan modifications involving both partial and full payment deferrals in April 2020. As of December 31, 2021, the Company has just one commercial real estate loan, in the principal amount of $3.5 million, with a payment modification that is still in effect, with such credit relationship making full interest payments.
The Company’s allowance for credit losses totaled $37.0 million on December 31, 2021 compared to $37.8 million on September 30, 2021 and $46.9 million at year-end 2020. The allowance for credit losses represented 1.23% of period-end loans (1.24% excluding PPP loans) on December 31, 2021, compared with 1.26% of period-end loans (1.29% excluding PPP loans) on September 30, 2021, and 1.52% of period-end loans (1.61% excluding PPP loans) at December 31, 2020.
The Company adopted ASU No. 2016-13, Financial Instruments – Credit Losses (Topic 326) (“CECL”) on January 1, 2020. Under the CECL model, certain acquired loans continue to carry a fair value discount as well as an allowance for credit losses. As of December 31, 2021, the Company held net discounts on acquired loans of $4.9 million. The allowance for credit losses declined modestly during the quarter ended December 31, 2021, as a result of the Company recording a $2.0 million provision for credit losses while recording net charge-offs of $2.8 million. During 2020, the allowance for credit losses increased through elevated provision for credit losses primarily due to the developments in 2020 related to the COVID-19 pandemic and the resulting impact on the economic assumptions used in the CECL model.
The Company tracks lending exposure by industry classification to determine the potential risk associated with industry concentrations, if any, that could lead to additional credit loss exposure. As a result of the COVID-19 pandemic, the Company identified certain loan segments that represented higher levels of credit risk, as many of the customers in these segments, were expected to incur significant negative impacts to their businesses as a result of governmental stay-at-home orders and travel restrictions, limited attendance, social distancing and face mask requirements, and work-from-home and hybrid work models being used by employers.
On December 31, 2021, the Company had the following exposure to these COVID-19-impacted loan segments: Non-performing assets totaled $14.8 million on December 31, 2021, compared to $18.5 million on September 30, 2021, and $21.8 million on December 31, 2020. Non-performing assets represented 0.26% of total assets at December 31, 2021 compared to 0.34% at September 30, 2021 and 0.44% at year-end 2020. Non- performing loans totaled $14.8 million on December 31, 2021, compared to $18.4 million on September 30, 2021, and $21.5 million at year-end 2020. Non-performing loans represented 0.49% of total loans at December 31, 2021 compared to 0.61% at September 30, 2021 and 0.70% at year-end 2020. December 31, 2021 total deposits increased $151.4 million, or 13% on an annualized basis, compared to September 30, 2021, and increased $637.8 million, or 16%, compared with December 31, 2020. The increase in total deposits at December 31, 2021, compared with both September 30, 2021, and December 31, 2020, was largely impacted by general inflows of customers deposits during all periods presented, net income for the year ended December 31, 2021, totaled $84,137,000, or $3.17 per share, an increase of $21,927,000, or approximately 35% on a per-share basis, from the year ended December 31, 2020, net income of $62,210,000, or $2.34 per share. The net income growth during 2021 compared with 2020 was driven by a number of factors including improved net interest income, lower provision for credit losses, and increased non-interest revenue which was partially offset by a modestly higher level of non-interest expense participation in the PPP, stimulus payments provided by the federal government, and an increase in public funds.
Results of Operations Highlights – Year ended December 31, 2021
During the year ended December 31, 2021, net interest income, on a non-tax equivalent basis, totaled $160,830,000, representing an increase of $5,587,000, or 4%, from the year ended December 31, 2020 net interest income of $155,243,000. The increase in net interest income during 2021 compared with 2020 was largely attributable to an increase in average earning assets, a higher level of fees recognized related to PPP loans which were partially offset by a lower level of accretion of loan discounts on acquired loans, and a decreased level of interest expense on interest-bearing liabilities related to lower interest rates.
The tax-equivalent net interest margin for the year ended December 31, 2021, was 3.31% compared to 3.63% in the year ended December 31, 2020. The Company’s net interest margin in both periods presented has been impacted significantly by fees recognized as a part of the PPP and accretion of discounts on acquired loans.
Fees recognized on PPP loans through net interest income totaled $12,196,000 during 2021 and $7,978,000 during 2020. The fees recognized related to the PPP contributed approximately 24 basis points to the net interest margin on an annualized basis in 2021 and 18 basis points in 2020. Accretion of discounts on acquired loans contributed approximately 7 basis points to the net interest margin during 2021 and 13 basis points during 2020. Accretion of discounts on acquired loans totaled $3,476,000 during 2021 and $5,769,000 during 2020.
Historically low market interest rates continue to impact the Company’s net interest margin. Lower market interest rates continue to negatively impact earning asset yields, with these declines being partially mitigated by a lower cost of funds. The Company has also continued to carry excess liquidity on the balance sheet that resulted from significant deposit growth during 2020 and continued in 2021, the forgiveness of PPP loans, and somewhat muted loan growth.
During the year ended December 31, 2021, the Company recorded a negative provision for credit losses of $6,500,000 compared with the year ended December 31, 2020 provision for credit losses of $17,550,000. The negative provision for credit losses in 2021 was largely due to declines in certain adversely criticized assets and improvement in certain pandemic-related stressed sectors for which the Company had provided significant levels of allowance for credit losses during 2020. The level of provision for credit losses during 2020 was primarily due to the developments related to the COVID-19 pandemic and the resulting impact on the economic assumptions used in the CECL model.
During the year ended December 31, 2021, non-interest income increased $4,988,000, or 9%, from the year ended December 31, 2020. Trust and investment product fees increased $2,316,000, or 29%, during 2021 compared with 2020. The increase in 2021 compared with 2020 was largely attributable to increased assets under management in the Company’s wealth management group.
Company-owned life insurance revenue declined $778,000, or 34%, during 2021 compared with 2020. The decline was largely related to death benefits received from life insurance policies during 2020. Interchange fees increased $2,587,000, or 25%, during 2021 compared to 2020. The increased level of fees during 2021 compared with 2020 was due to increased economic activity and increased card utilization by customers.
Interchange fees increased $2,587,000, or 25%, during 2021 compared to 2020. The increased level of fees during 2021 compared with 2020 was due to increased economic activity and increased card utilization by customers.
Other operating income increased $3,603,000, or 106%, during 2021 compared with 2020. The increase during 2021 was largely attributable to the net gain of approximately $1.4 million related to the sale of the two branch office locations in Lexington, Kentucky, and approximately $863,000 of fair value adjustments and higher transaction fees associated with interest rate swap transactions with loan customers. Also contributing to the increase in 2021, was the donation of a building and accompanying real estate to a local municipality in one of the Company’s market areas. The estimated fair value of the property was approximately $575,000 greater than the book value which resulted in a net gain on the disposition of fixed assets. A corresponding contribution expense of $800,000 was recognized in the advertising and promotion expenses of the Company’s income statement related to the donation of the building and real estate. Net gains on sales of loans declined $1,641,000, or 17%, during 2021 compared with 2020. The decline in 2021 compared with 2020 was generally attributable to a lower level of fair value adjustments on commitments to sell loans and a modestly lower level of loans sold, which were partially offset by higher pricing levels on loans sold. Loan sales totaled $266.0 million during 2021 compared with $316.4 million during 2020.
The Company realized $2,247,000 in gains on sales of securities during 2021 compared with $4,081,000 during 2020. The sales of securities in both periods were done as part of shifts in the allocations within the securities portfolio. During 2021, non-interest expense totaled $124,007,000, an increase of $6,884,000, or 6%, compared with 2020. The year ended December 31, 2021, included non-recurring expenses totaling $4,100,000 related to the Company’s previously discussed operating optimization plan, $3,050,000 related to a previously disclosed litigation reserve, and $735,000 of transaction-related expenses for the acquisition of Citizens Union Bancorp of Shelbyville, Inc. (“Citizens Union”), which was completed on January 1, 2022.
Occupancy, furniture, and equipment expense increased by $807,000, or 6%, during 2021 compared with 2020. The increase during 2021 was due to lease termination costs associated with the Company’s operating optimization plan that totaled approximately $1,411,000 during 2021. FDIC premiums increased $679,000, or 92%, during 2021 compared with 2020. The increase during 2021 compared with 2020 was related to credits received from the FDIC in 2020.
There were no credits received during 2021. The credits received in 2020 were due to the reserve ratio of the deposit insurance fund exceeding the FDIC targeted levels.
Data processing fees increased $722,000, or 10%, during 2021 compared with 2020. The increase was related to various software costs including expenses related to the PPP loan program as well as increased data processing fees for the branch sales during 2021.
Professional fees increased by $1,011,000, or 25%, during 2021 compared with 2020. The increase during 2021 compared with 2020 was largely attributable to professional fees associated with the acquisition of Citizens Union and an increase in legal fees related to non-acquisition-related legal matters.
Advertising and promotion expenses increased $608,000, or 17%, during 2021 compared with 2020. The increase during 2021 was attributable to the donation of a building and accompanying real estate to a local municipality in one of the Company’s market areas. The estimated fair value of the property was approximately $800,000 which resulted in the increase in the contribution expense during 2021.
Other operating expenses increased $3,407,000, or 21%, during 2021 compared with 2020. The increase during 2021 was primarily attributable to the establishment of a settlement reserve for a lawsuit challenging the Company’s checking account practices associated with its assessment of overdraft fees for certain debit card transactions. Like many other financial institutions, the Company has been the subject of an overdraft fee-related putative class action lawsuit since the third quarter of 2020. This type of litigation is often time-consuming and expensive to defend. In order to avoid further costs associated with this type of litigation, the Company determined it was in its best interest to pursue a settlement of this lawsuit during the third quarter of 2021 and therefore accrued a $3,050,000 settlement reserve. On October 21, 2021, the Company executed a settlement agreement for payment of that amount in connection with this lawsuit which remains subject to court approval. In addition, the Company recognized $1,276,000 of charges related to various fixed asset write-downs as a part of the Company’s operating optimization plans announced in March 2021.
Results of Operations Highlights – Quarter ended December 31, 2021
Net income for the quarter ended December 31, 2021, totaled $19,272,000, or $0.73 per share, a decline of 10% on a per-share basis compared with the third quarter 2021 net income of $21,486,000, or $0.81 per share, and a decline of 8% on a per-share basis compared with the fourth quarter 2020 net income of $20,890,000, or $0.79 per share.
During the fourth quarter of 2021, net interest income, on a non-tax-equivalent basis, totaled $40,731,000, a decline of $556,000, or 1%, compared to the third quarter of 2021 net interest income of $41,287,000 and a decline of $1,409,000, or 3%, compared to the fourth quarter of 2020 net interest income of $42,140,000.
The decline in net interest income during the fourth quarter of 2021 compared with both the third quarter of 2021 and the fourth quarter of 2020 was primarily attributable to a lower level of fees recognized related to PPP loans in the fourth quarter of 2021.
The tax-equivalent net interest margin for the quarter ended December 31, 2021, was 3.20% compared with 3.33% in the third quarter of 2021 and 3.71% in the fourth quarter of 2020. The Company’s net interest margin in all periods presented has been impacted by fees recognized as a part of the PPP and accretion of loan discounts on acquired loans.
Fees recognized on PPP loans through net interest income totaled $2,302,000 during the fourth quarter of 2021, $4,109,000 during the third quarter of 2021, and $5,400,000 during the fourth quarter of 2020. The fees recognized related to the PPP contributed approximately 18 basis points to the net interest margin on an annualized basis in the fourth quarter of 2021, 32 basis points in the third quarter of 2021, and 47 basis points in the fourth quarter of 2020. Accretion of loan discounts on acquired loans contributed approximately 11 basis points to the net interest margin in the fourth quarter of 2021, 4 basis points in the third quarter of 2021, and 9 basis points in the fourth quarter of 2020. Accretion of discounts on acquired loans totaled $1,421,000 during the fourth quarter of 2021, $516,000 during the third quarter of 2021, and $1,047,000 during the fourth quarter of 2020.
Historically low market interest rates continue to impact the Company’s net interest margin. Lower market interest rates continue to negatively impact earning asset yields, with these declines being partially mitigated by a lower cost of funds. The Company has also continued to carry excess liquidity on the balance sheet that resulted from significant deposit growth during 2020 and 2021 and the forgiveness of PPP loans. During the quarter ended December 31, 2021, the Company recorded a provision for credit losses of $2,000,000 compared with a negative provision for credit losses of $2,000,000 in the third quarter of 2021 and a provision for credit losses of $2,000,000 during the fourth quarter of 2020.
Net charge-offs totaled $2,781,000, or 37 basis points on an annualized basis, of average loans outstanding during the fourth quarter of 2021 compared with $197,000, or 3 basis points on an annualized basis, of average loans during the third quarter of 2021 and compared with $1,909,000, or 24 basis point, of average loans during the fourth quarter of 2020. The elevated level of net charge-offs during the fourth quarter of 2021 was primarily related to a single commercial loan relationship that became adversely classified earlier during 2021. The elevated level of net charge-offs during the fourth quarter of 2020 was primarily related to a single commercial loan relationship that had been adversely classified for several quarters.
During the quarter ended December 31, 2021, non-interest income totaled $14,967,000, a decline of $589,000, or 4%, compared with the third quarter of 2021 and an increase of $276,000, or 2%, compared with the fourth quarter of 2020.
Trust and investment product fees declined $37,000, or 1%, during the fourth quarter of 2021 compared with the third quarter of 2021 and increased $503,000, or 23%, compared with the fourth quarter of 2020. The increase during the fourth quarter of 2021 compared with the fourth quarter of 2020 was largely attributable to increased assets under management within the Company’s wealth management group.
Service charges on deposit accounts increased $276,000, or 14%, during the fourth quarter of 2021 compared with the third quarter of 2021 and increased $334,000, or 17%, compared with the fourth quarter of 2020. The increase during the fourth quarter of 2021 compared with both periods was largely the result of increased deposit customer activity.
Interchange fee income increased $126,000, or 4%, during the quarter ended December 31, 2021, compared with the third quarter of 2021 and increased $689,000, or 25%, compared with the fourth quarter of 2020. The increase in the level of fees during the fourth quarter of 2021 compared with both the third quarter of 2021 and the fourth quarter of 2020 was largely related to increased card utilization by customers.
Other operating income declined $891,000, or 34%, during the fourth quarter of 2021 compared with the third quarter of 2021 and increased $567,000, or 50%, compared with the fourth quarter of 2020. The decline during the fourth quarter of 2021 was primarily attributable to the net gain of approximately $1.4 million related to the sale of the two branch office locations realized in the third quarter of 2021. The Company donated a building and accompanying real estate to a local municipality in one of the Company’s market areas during the fourth quarter of 2021. The estimated fair value of the property was approximately $575,000 greater than the book value which resulted in a net gain on the disposition of fixed assets that partially offset the branch sale gain from the third quarter of 2021 and resulted in the increase compared with the fourth quarter of 2020. A corresponding contribution expense of $800,000 was recognized in advertising and promotion expenses of the Company’s income statement related to the donation of the building and accompanying real estate.
Net gains on sales of loans declined $347,000, or 16%, during the fourth quarter of 2021 compared with the third quarter of 2021 and declined $680,000, or 27%, compared with the fourth quarter of 2020. The decline in the fourth quarter of 2021 compared with both the third quarter of 2021 and the fourth quarter of 2020 was largely related to a lower volume of loans sold and lower pricing levels. Loan sales totaled $66.3 million during the fourth quarter of 2021 compared with $69.7 million during the third quarter of 2021 and $96.9 million during the fourth quarter of 2020.
The Company realized $754,000 in gains on sales of securities during the fourth quarter of 2021 compared with $218,000 during the third quarter of 2021 and $1,891,000 during the fourth quarter of 2020. The sales of securities in all periods were done as part of modest shifts in the allocations within the securities portfolio.
During the quarter ended December 31, 2021, non-interest expense totaled $31,267,000, a decline of $1,177,000, or 4%, compared with the third quarter of 2021, and an increase of $1,980,000, or 7%, compared with the fourth quarter of 2020. The non-interest expense included non-recurring expenses that totaled $1,534,000 during the fourth quarter of 2021 related to the operating optimization plan announced by the Company during the first quarter of 2021. The fourth quarter of 2021 non-interest expenses also included approximately $184,000 of non-recurring acquisition-related expenses for the acquisition of Citizens Union that was announced during the third quarter of 2021 while the third quarter of 2021 included approximately $457,000 in acquisition related expenses.
Occupancy, furniture, and equipment expense declined $253,000, or 7%, during the fourth quarter of 2021
compared with the third quarter of 2021 and declined $400,000, or 11%, compared to the fourth quarter of 2020.
The decline during the fourth quarter of 2021 compared to the third quarter of 2021 and fourth quarter of 2020 was largely related to operating fewer branch offices which was the result of the Company’s operating optimization plan.
Professional fees declined $378,000, or 28%, in the fourth quarter of 2021 compared with the third quarter of 2021 and increased $22,000, or 2%, compared with the fourth quarter of 2020. The decline during the fourth quarter of 2021, compared with the third quarter of 2021, was due in large part to a lower level of acquisition related legal and other professional fees associated with the Citizens Union acquisition.
Advertising and promotion expenses increased $916,000, or 102%, in the fourth quarter of 2021 compared with the third quarter of 2021 and increased $885,000, or 95%, compared with the fourth quarter of 2020. The increase during the fourth quarter of 2021 compared with both periods was primarily related to the donation of a building and accompanying real estate to a local municipality in one of the Company’s market areas. The estimated fair value of the property was approximately $800,000 which resulted in the increase in the contribution expense during 2021.
Other operating expenses declined $1,309,000, or 20%, during the fourth quarter of 2021 compared with the third quarter of 2021 and increased $1,571,000, or 44%, compared with the fourth quarter of 2020. The decline during the fourth quarter of 2021 compared with the prior quarter was primarily attributable to the previously discussed establishment of a settlement reserve for a lawsuit challenging the Company’s assessment of overdraft fees for certain debit card transactions during the third quarter of 2021. Partially offsetting this decline was the write-down of fixed assets during the fourth quarter of 2021 related to the Company’s optimization plan that totaled $734,000 and the prepayment of $50.0 million of FHLB advances during the fourth quarter of 2021 that resulted in a $357,000 debt extinguishment charge. The increase in other operating expenses during the fourth quarter of 2021 compared with the fourth quarter of 2020 was largely attributable to the optimization plan fixed asset write-down and debt extinguishment charge in the fourth quarter of 2021.
About German American
German American Bancorp, Inc. is a Nasdaq-traded (symbol: GABC) financial holding company based in Jasper, Indiana. German American, through its banking subsidiary German American Bank, operates 78 banking offices in 19 contiguous southern Indiana counties and 14 counties in Kentucky. The Company also owns an investment brokerage subsidiary (German American Investment Services, Inc.) and a full line property and the casualty insurance agency (German American Insurance, Inc.).
