Exhibit 99.1
 
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toppage23q.jpg
 
 
 
 
November 8, 2017
 
 
 
 
 
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toourshareholdersa04a09.jpg
 
 
 
 
 
 
We are pleased to report the financial results for Union Bankshares, Inc. for the three and nine months ended September 30, 2017. Consolidated net income for the three months ended September 30, 2017 was $2.4 million, or $0.53 per share, compared to $2.3 million, or $0.51 per share, for the same period in 2016. Consolidated net income year to date improved 5.9% to $6.5 million or $1.46 per share, compared to $6.2 million, or $1.38 per share, for the same period in 2016.

Thus far this year our loan portfolio has grown $52.1 million, or 9.8%, compared to the same period last year, with much of the growth coming from municipal loans, residential construction loans, and commercial real estate loans. We have a solid pipeline of quality loans and expect good growth in the fourth quarter as well. In addition, deposits have grown $34.4 million, or 6.0%, compared to the same period last year. Both our loan and deposit growth are the result of purposeful initiatives, primarily direct calling on prospective customers, intended to generate this growth.

Though some say that this year’s fall colors were muted, it has only taken slight ventures off of the beaten paths to find spectacular foliage. The unusually mild and rainless weeks this fall have created both an excellent tourism season as well as concerns about local forest fires in our region. In general, the economy in the regions we serve continue to improve with business concerns shifting from lack of customers to lack of available employees.

On October 18, 2017 the Board of Directors voted to terminate Union Bank’s Defined Benefit Pension Plan (DBPP). The DBPP was frozen in October of 2012 at which time the existing 401k Defined Contribution Retirement Plan was significantly enhanced. The DBPP was frozen due to the rapidly escalating cost of maintaining the plan as well as balance sheet volatility caused by swings in the market value of the plan assets. Although the plan is in a frozen
status there continues to be on going risks that changes in economic conditions could negatively impact the performance of the plan assets resulting in unexpected adjustments to your Company’s financial statements. The Board of Directors carefully weighed the options with terminating the pension plan, including the impact on plan participants, and determined 2018 is the appropriate time to terminate the plan.

Based on the estimated value of assets held in the DBPP, the Company currently estimates that a cash contribution of approximately $1.1 million will be required to fully fund the DBPP’s liabilities at termination. In addition, the Company expects to record a charge to earnings of $3.2 million at termination, which is expected to occur during the fourth quarter of 2018. Actual amounts may differ from these estimates. Although the estimated charge to earnings is significant, your Company will remain well capitalized as defined by current regulatory guidance. Also, we do not expect the termination of the plan in 2018 to negatively affect plan participants nor impact future dividend payments.

Additional action taken by the Board of Directors on October 18, 2017 was the declaration of a regular quarterly cash dividend of $0.29 per share payable November 8, 2017 to shareholders of record as of October 28, 2017. Please find enclosed your dividend check or advice of deposit. As a reminder, you may have your dividend payment deposited electronically to your bank of choice, which naturally we hope is Union Bank. Please contact Kristy Adams Alfieri at 802.888.0982 or at kadamsalfieri@unionbankvt.com.


Sincerely,
 
 
 
 
 
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If you need assistance with a change in registration of certificates, combining your certificates into one, reporting lost certificates, non-receipt or loss of dividend checks, assistance regarding direct deposit of dividends, information about the Company, or to receive copies of financial reports, please contact Kristy Adams Alfieri, Assistant Secretary at 802-888-0982 or contact our Transfer Agent at the address and phone number listed below:
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TRANSFER AGENT:
 
Broadridge Corporate Issuer Solutions, Inc.
P.O. Box 1342
Brentwood, NY 11717
866.321.8022 or
720.378.5956
E-mail: shareholder@broadridge.com
 
 
 
 
NASDAQ STOCK MARKET
 
 
Ticker Symbol: UNB
Corporate Name: Union Bankshares, Inc.
Corporate Address:
20 Lower Main Street
PO Box 667
Morrisville, VT 05661-0667
Investor Relations: UBLOCAL.COM
 
kdgsignaturea09.jpg
dsssignaturea09.jpg
 
 
Kenneth D. Gibbons
Chairman

David S. Silverman
President & Chief Executive Officer
 
 
 
 
 
 
 
 
 
 
 
 
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About Union Bankshares
 
 
 
 
 
 
 
 
Union Bankshares, Inc. operates as the holding company for Union Bank, which provides commercial, retail and municipal banking services and asset management services throughout northern Vermont and New Hampshire. Union Bank was founded in 1891 in Morrisville, Vermont, where the Bank’s and its holding company’s headquarters are located. Union Bank operates 17 banking offices and three loan centers and several ATMs throughout its geographical footprint.

Union Bank has been helping people buy homes and local businesses create jobs in area communities since opening its doors over 125 years ago. Union Bank has earned an exceptional reputation for residential lending programs and has recently been named, for the fourth consecutive year, the USDA RD Vermont Home Lender of the year. Union Bank has also been designated as an SBA Preferred lender for its participation in small business lending.
 
 
 





 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Consolidated Balance Sheets
(unaudited, in thousands)
 
Consolidated Statements of Income
(unaudited, in thousands)
 
Union Bankshares, Inc.
 
 
 
 
 
 
 
 
DIRECTORS
OFFICERS
 
 
 
Kenneth D. Gibbons-Chairman
Kenneth D. Gibbons - Chairman
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Neil J. Van Dyke-Vice Chairman
David S. Silverman - President & CEO
 
ASSETS
SEPT. 30, 2017
 
SEPT. 30, 2016
 
 
SEPT. 30, 2017
 
SEPT. 30, 2016
 
SEPT. 30, 2017
 
SEPT. 30, 2016
 
 
Steven J. Bourgeois
 
Karyn J. Hale - Chief Financial Officer
 
 
 
 
 
 
 
Dawn D. Bugbee
 
John H. Steel - Secretary
 
 
 
 
 
 
(3 months ended)
 
(9 months ended)
 
 
 
 
 
 
 
 
 
 
 
 
John M. Goodrich
 
Kristy Adams Alfieri - Assistant Secretary
 
Cash and Due from Banks
 
$
3,512

 
$
3,952

 
Interest Income
$
7,397

 
$
6,786

 
$
21,337

 
$
19,922

 
 
 
 
 
 
 
 
 
 
Timothy W. Sargent
 
Jeffrey G. Coslett - Vice President
 
Federal Funds Sold & Overnight Deposits
 
8,885

 
31,622

 
Interest Expense
587

 
471

 
1,640

 
1,503

 
David S. Silverman
 
 
 
 
 
 
 
 
 
Net Interest Income
6,810

 
6,315

 
19,697

 
18,419

 
John H. Steel
 
REGIONAL
ADVISORY BOARD
MEMBERS
 
Interest Bearing Deposits in Banks
 
8,356

 
9,753

 
 
 
 
 
Schuyler W. Sweet
 
 
 
 
 
Provision for Loan Losses
150

 

 
150

 
150

 
 
 
 
Investment Securities
 
64,970

 
60,670

 
Net Interest Income After
Provision for Loan Losses
6,660

 
6,315

 
19,547

 
18,269

 
Union Bank
 
Michael R. Barrett - St. Johnsbury
 
Loans Held for Sale
 
5,675

 
10,214

 
 
 
 
 
 
Joel S. Bourassa - Northern NH
 
 
 
 
Trust Income
179

 
171

 
548

 
523

 
DIRECTORS
 
Steven J. Bourgeois - St. Albans
 
Loans, net
 
579,651

 
523,010

 
Noninterest Income
2,327

 
2,633

 
6,524

 
7,064

 
Kenneth D. Gibbons-Chairman
Stanley T. Fillion - Northern NH
 
 
 
 
 
 
 
 
 
 
 
Neil J. Van Dyke-Vice Chairman
Rosemary H. Gingue - St. Johnsbury
 
Reserve for Loan Losses
 
(5,259
)
 
(5,226
)
 
Noninterest Expenses:
 
 
 
 
 
 
 
 
Steven J. Bourgeois
 
John M. Goodrich - St. Johnsbury
 
 
 
 
 
 
 
Salaries & Wages
2,570

 
2,622

 
7,642

 
7,522

 
Dawn D. Bugbee
 
Richard L. Isabelle - St. Johnsbury
 
Premises and Equipment, net
 
13,244

 
13,377

 
 
 
 
 
John M. Goodrich
 
Christopher M. Knapp - Northern NH
 
 
 
 
 
 
 
Pension & Employee Benefits
954

 
865

 
2,784

 
2,659

 
Nancy C. Putnam
 
Coleen K. Kohaut - St. Albans
 
Accrued Interest & Other Assets
 
26,053

 
25,207

 

 
 
 
 
 
 
 
 
Timothy W. Sargent
 
Justin P. Lavely - St. Johnsbury
 
 
 

 

 
Occupancy Expense, net
320

 
297

 
1,073

 
923

 
David S. Silverman
 
Daniel J. Luneau - St. Albans
 
Total Assets
 
$
705,087

 
$
672,579

 
 
 
 
 
 
 
 
 
 
John H. Steel
 
Mary K. Parent - St. Johnsbury
 
 
 
 
 
 
 
Equipment Expense
532

 
553

 
1,589

 
1,603

 
Schuyler W. Sweet
 
Samuel H. Ruggiano - St. Albans
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
David S. Silverman - All
 
 
 
 
 
 
 
Other Expenses
1,565

 
1,687

 
4,665

 
4,828

 
 
 
Schuyler W. Sweet - Northern NH
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total
5,941

 
6,024

 
17,753

 
17,535

 
Union Bank Offices
(ATMs at all Branch Locations)
 
 
LIABILITIES & SHAREHOLDERS' EQUITY
SEPT. 30, 2017
 
SEPT. 30, 2016
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Income Before Taxes
3,225

 
3,095

 
8,866

 
8,321

 
 
 
 
 
 
 
 
 
Income Tax Expense
855

 
827

 
2,339

 
2,155

 
VERMONT
 
 
 
 
Noninterest Bearing Deposits
 
$
119,203

 
$
116,381

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income
$
2,370

 
$
2,268

 
$
6,527

 
$
6,166

 
Barre
Loan Center
 
 
Interest Bearing Deposits
 
387,707

 
350,376

 
 
 
 
 
 
 
 
 
 
 
14 North Main Street
802.476.0062
 
 
 
 
Earnings per share
$
0.53

 
$
0.51

 
$
1.46

 
$
1.38

 
Danville
421 Route 2 East
802.684.2211
 
Time Deposits
 
99,714

 
105,429

 
 
 
 
 
 
 
 
 
 
Fairfax
Jct. Routes 104 & 128
802.849.2600
 
 
 
 
 
 
 
Book Value Per Share
 
 
 
 
$
13.36

 
$
12.74

 
Hardwick
103 VT Route 15 West
802.472.8100
 
Borrowed Funds
 
32,520

 
37,513

 
 
 
 
 
 
 
 
 
 
Jeffersonville
5062 VT Route 15
802.644.6600
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Johnson
198 Lower Main Street
802.635.6600
 
Accrued Interest & Other Liabilities
 
6,336

 
6,075

 
 
 
 
 
 
 
 
 
 
Lyndonville
183 Depot Street
802.626.3100
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Morrisville
20 Lower Main Street
802.888.6600
 
Common Stock
 
9,876

 
9,869

 
 
 
 
 
 
 
 
 
 
 
65 Northgate Plaza
802.888.6860
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Newport
Loan Center
 
 
Additional Paid-in Capital
 
753

 
605

 
 
 
 
 
 
 
 
 
 
 
325 East Main Street
802.334.0750
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
St. Albans
15 Mapleville Depot
802.524.9000
 
Retained Earnings
 
55,731

 
51,989

 
 
 
 
 
 
 
 
 
 
St. Johnsbury
364 Railroad Street
802.748.3131
 
Accumulated Other
Comprehensive Loss
 
(2,692
)
 
(1,635
)
 
 
 
 
 
 
 
 
 
 
 
325 Portland Street
802.748.3121
 
 
 
 
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S. Burlington
Loan Center
 
 
 
 
 
 
 
30 Kimball Avenue
802.865.1000
 
Treasury Stock at Cost
 
(4,061
)
 
(4,023
)
 
 
Stowe
47 Park Street
802.253.6600
 
 
 
 
 
 
 
 
NEW HAMPSHIRE
 
 
Total Liabilities & Shareholders' Equity
 
$
705,087

 
$
672,579

 
 
Groveton
3 State Street
603.636.1611
 
Standby letters of credit were $1,584,000 and $1,624,000 at September 30, 2017 and 2016, respectively.
 
 
Littleton
263 Dells Road
603.444.7136
 
 
 
 
76 Main Street
603.444.5321
bottomofbalsheetq3.jpg
 
Lincoln
135 Main Street
603.745.4000
 
N. Woodstock
155 Main Street
603.745.2488
 
 
 
 
 


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