One owner, two charters, eight offices in three states … now operating together as Security Savings Bank
In general terms of mergers and acquisitions, the story of Exchange State Bank and Security Savings Bank is one-of-a-kind.
For one thing, the name has changed — all locations are now known as Security Savings Bank. but the leadership has stayed the same.
“We still have the Exchange State Bank leadership,” said Tim Plimpton, president and CEO of Security Savings Bank.
“You still get to see Ryan (DeBates) in Luverne, you’ll see me in Hills and you’ll see Mark Iveland in Ellsworth …”
He goes on to list the names of the other five market presidents, as they’re now titled, in Larchwood, Inwood and George, Iowa, and Canton and Sioux Falls in South Dakota.
Plimpton’s office will be in Hills, but Kathy Fick is now market president there
“It’s about the people,” Plimpton said. “You can change the name, but the people are still the same.”
Exchange State Bank and Security Savings Bank are owned by the Bonander family, which saw an opportunity to streamline operations and strengthen capacity by merging into one charter.
After Security Savings Bank opened its new office in Sioux Falls last year, the board decided to move the Minnesota charter to South Dakota, so all operations could be on the same page.
“It just made sense to do it this way,” DeBates said, explaining that all operations are now regulated under South Dakota and the FDIC.
“Our software will be integrated, and that’s a big deal for us to all be able to communicate with each other and see what each other is doing.”
The merged operation will have advantages for customers, too, Plimpton said.
“This gives us way more capacity and higher lending limits for customers,” he said.
As of Jan. 1, Exchange State Bank no longer exists, and on March 12, 2019, Exchange State Bank accounts will become Security Savings Bank accounts.
But old check blanks will always be accepted, Plimpton pointed out, because the new system has already accounted for the old routing numbers and account numbers. “We took care of that right away,” he said.
The fact that all locations now operate on the same system means that customers can bank at all locations with the same service.
“There are a lot of people who live in these communities and work in Sioux Falls,” Plimpton said.
“For them to be able to stop in Sioux Falls and do business will be really convenient.”
Tale of two banks in three states owned by one family
The bank’s original charter in Granite, Iowa, dates back to 1920, when Axel Bonander was a shareholder and board director.
When the bank moved to Larchwood, Iowa, in 1934, Axel’s son, Harold began working for the bank, and eventually worked his way to bank president in 1959.
In 1978 Harold Bonander turned over the president’s job to Mark Dominy and in 2012 Joel Klatt was named President.
Rodney and Lachlan Bonander purchased the bank from Harold Bonander in 2007.
Security Savings Bank expanded to include branch offices in Inwood in 1985 and George, Iowa, in 2007.
A new Security Savings Bank was built in Canton, South Dakota, in 2011, and in 2014, the charter was moved from Iowa to South Dakota, but primary operations were conducted through the Larchwood office.
In 2017, a new Security Savings Bank was started in Sioux Falls, with the opening in 2018.
Meanwhile, the Bonander family expanded its community banking business on the Minnesota side of the border.
In 1978, Dennis Roning sold the Exchange State Bank of Hills to Rodney and Lachlan Bonander.
That bank, which first chartered in 1900, changed its name to Exchange State Bank in 2004, the same year it acquired Ellsworth State Bank.
In 2007, it acquired Hardwick State Bank and in 2008, ESB moved its headquarters from Hills to Luverne, where the new location was built at Gabrielson Drive and South Highway 75.
Good-bye, Exchange State Bank
He said the Exchange State Bank Christmas party was a time to reflect on the bank’s history in Hills.
“I have to admit, I got a little emotional,” said Plimpton, who’s been with the bank for 28 years. “It’s been Exchange State Bank as long as I’ve known it here.”
For others, it’s been much longer.
Carol Nelson said she was looking forward to retiring from Exchange State Bank after 50 years. (She’ll still have 50 years with the bank, but it will just have a different name when she retires.)
“She told me for the first time in her entire life she won’t get a paycheck from Exchange State Bank,” Plimpton said.
He noted that all the bank locations have a history of longevity with their employees, and that’s not just by chance.
“We tell people when they come to work here, we want this to be their last job,” Plimpton said. “It’s part of living and working in a community — to keep local connections.”
He said banks do better when they know their customers and communities do better when they are closely tied to their banks.
“We’re blessed with good people. It’s a two-way street,” Plimpton said. “We’ve been involved in these small communities and we want them to survive.”