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Welcome to Volume 9, Issue 3 By Chris Schneiderman - Welcome to the final newsletter of 2018. As we are all aware, commodity prices, the stock market, interest rates, and even our weather have all been volatile in 2018. A couple of weeks ago, there was simultaneously a tornado warning and a blizzard warning only 50 miles apart in southern Illinois! We are fortunate to say that in 2018 the bank once again reached record loan and deposit growth, which not only gives you a safe and sound bank, but also gives us the ability to continually enhance our products and services. With that in mind, we will be launching State Bank’s mobile deposit capability for personal accounts within the next couple of weeks. This service gives account holders the ability to deposit physical checks into personal bank accounts right from their mobile device. The service will be featured within our mobile banking app and has a very simple enrollment process. All you need to do to make your mobile deposit is properly endorse the back of the check, take a picture of the front and back of the check, and click submit a few times. You will then see your deposit in your account on the next business day, subject to certain time cut-offs, of course. We are expecting high usage of this service and although our tellers will miss seeing you, you might be able to avoid a physical trip to the bank the next time you receive a check.  Another new service available later in 2019 will be the ability to upload your debit card into your mobile wallet. Some of you may already use Apple Pay or Google Pay with other debit or credit cards. Those applications give you the ability to pay with your mobile device instead of using your physical debit or credit card. Before the end of 2019, State Bank’s debit cards will have the ability to interface with those mobile payment applications, thereby allowing you to use your State Bank debit card via your mobile device at gas stations, retailers, and any other stores that accept those types of payment. We are very excited for the launch of these two new services and look forward to your usage and feedback.  As always, we continually strive to enhance our product lines to meet the ever-changing needs of our customers. Thank you for your support and loyalty in 2018, and we look forward to serving your banking needs in 2019.

IN THIS ISSUE 2018 FSA Guarantee Lender Workshop Your Workforce and Today's Technology Upcoming Event: 2019 Agribusiness Seminar Save the Date: 9th Annual State Bank Foundation Golf Outing

ECONOMIC DATA Stephenson County Home Sales Stephenson County Median Home Sale Price Freeport Sales Tax Revenue Stephenson County & Freeport Employment/Unemployment

Ag Update: 2018 FSA Guarantee Lender Workshop By Shawn Cox - On November 15, 2018, northern Illinois ag lenders met for the 2018 Farm Service Agency Guarantee Lender Workshop. A number of topics were covered including changes to the FSA website, amendments to the FLP Handbook, review of FSA forms, and review of the FSA Environmental Policy. The morning also included Gary Schnitkey, Professor and Farm Management Specialist from the University of Illinois, and Gary Corbett, CEO of Fair Oaks Farms, discussing different facets of the ag industry. Gary Schnitkey reviewed the 2018 forecasts for corn and beans and what to consider in 2019. FSA is recommending to project 2019 prices at $3.85/bu of corn and $8.90/bu for soybeans. The dairy price seemed a little optimistic at $17/CWT for milk. These prices are comparable to the last couple of years: 2018: $3.60 corn/$9.50 soybeans/$16 milk 2017: $3.60 corn/$9.30 soybeans/$16 milk 2016: $3.90 corn/$9.00 soybeans/$17 milk Costs are anticipated to be relatively similar to 2018. However, if the price per bushel drops and costs remain the same, then yields will be the determining factor to making a profit in 2019. The general projections for 2019 do not look promising. It will be important to understand your input costs and minimize your expenses in 2019. One option discussed to improve chances of success in 2019 is to take advantage of the Market Facilitation Program that is available for entry until January 15, 2019. Please contact your local FSA office for additional information. Other suggestions include: Build working capital as it has been eroding away over the last couple of years Forgo capital investments and instead save cash and avoid additional debt payments Begin marketing 2019 crop Talk to land owners to discuss rent prices Consider acreage allocation decisions Gary Corbett gave a very insightful presentation regarding his operation, Fair Oaks Farms, in Indiana. The presentation included what a large, modernized dairy farm can look like. He also discussed how they are using leading technologies to make natural gas engines for their semi fleet and how they are cutting down on the carbon footprint of the company.  For more information on the 2018 FSA Guarantee Lender Workshop, contact me at shawn.cox@statebankfreeport.com.

Stephenson County Single Family/Condominium Sales  Acknowledgement: IllinoisRealtor.org

Your Workforce and Today's Technology By Travis Howell - Technology is quickly becoming integrated into every business function and every size of enterprise ranging from small and medium size businesses to multi-national corporations. Employees understand their work day will include interaction with multiple different levels of technology. In order to compete for, hire, and retain high-quality employees, businesses must consider their relationship with the technology they expect their workforce to use on a day-to-day basis. In a recent survey of employees and managers, a significant gap was discovered between the perceptions of management vs. the perceptions of employees when it came to introducing new technologies in the workplace. The survey found that 90% of managers agreed that their companies paid attention to employee needs when introducing new technologies, while only 53% of employees agreed. Also, 92% of managers said they were satisfied with the technology experience at their companies, while only 68% of staff agreed. This is a significant mismatch in experience and one that can lead to lower performance and satisfaction in the workplace. Specifically, employees cited the lack of mobile capabilities in their workplace as a source of frustration. Interestingly, today’s workforce is able and willing to invest time in order to learn new technologies and skills needed for the modern workplace if the training is provided by their employer. In the United States, respondents said they would be willing to invest 12 hours per month learning new technology skills. The main drivers of the desire to lean new technologies are efficiency and teamwork, status within the company, and individual achievement. People will look to how acquiring new skills can benefit their organizations, themselves, and specific work tasks. In short, management should understand the relationship that employees have with the relevant technology they use on a day-to-day basis. This understanding and communication can lead to insights that produce better use of technology that may result in increased productivity and workforce satisfaction. Also, management should understand their perception of technology in the workplace may be quite different from their employees. Management should explore the possibility of increased training programs for employees who desire to increase their skill sets. This may lead to better employee retention and satisfaction that will increase motivation and productivity throughout the organization. Increased training and technological awareness can better ensure that organizations keep up with the ever-changing landscape of business and support employees in continual learning of new skills.   Acknowledgement: PWC.com Consumer Intelligence Series - Tech at Work - 2018

Acknowledgement: IllinoisRealtor.org

Mark Your Calendars for the 2019 Agribusiness Seminar By Amanda Jacobs –  It’s beginning to look a lot like winter, which means it’s time to once again pack the Highland Community College Conference Room for the 2019 Agribusiness Seminar!  On February 6, 2019, we will feature three dynamic speakers who will cover the gamut of trending agriculture topics: Dr. David Kohl, Andrew Pritchard, and Mike North. We welcome back Dr. David Kohl as he dives into what it takes to position your operation for success in the current economic climate. Andrew Pritchard, meteorologist with Nutrien, will cover the weather in agriculture and its impact to ag production. Mike North is a market analyst who will discuss the risks and opportunities in today’s ag market. Don’t miss out on this great opportunity to listen to these three energetic and knowledgeable speakers.  Registration begins at 9:00 a.m. with a light breakfast. The morning session includes presentations from Dr. Kohl and Andrew Pritchard with a question and answer session to follow each speaker. A hearty lunch is served before Mike North wraps up the day. It will be very educational and our participants will walk away with useful information that can be applied in their own operations.   If you would like more information about the upcoming seminar, please contact Coral Lamm at Coral.Lamm@statebankfreeport.com or me at Amanda.Jacobs@statebankfreeport.com. We hope to see you there!

Acknowledgement: Illinois Department of Revenue

Save the Date: 9th Annual State Bank Foundation Golf Outing By Andrea Moring - Mark your calendars for the 9th Annual State Bank Foundation Golf Outing to be held Friday, May 17, 2019 at the Freeport Club! The golf outing is the largest fundraising event benefiting the State Bank Foundation and has been held annually in May since 2011. Since the first outing in 2011, our golfers have raised a total of $63,955 to give back to our community.    The State Bank Team is committed to giving back to the communities in which we serve. Our goal is to help and support our neighbors by enhancing the quality of life for all residents. With this objective in mind, we created the State Bank Foundation .  The State Bank Foundation supports art, health, youth, and educational programs that make a positive difference and encourage meaningful and sustainable change within the communities we serve. Our vision continues to be to provide financial assistance for programs of nonprofit, community-based organizations that have a positive impact in the communities where we live and do business. This is our mission and our passion! On behalf of all of the employees of State Bank , we thank you all for your support of the State Bank Foundation, and hope to see you at the 9th Annual State Bank Foundation Golf Outing in May!

Acknowledgement: Illinois Department of Employment Security

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