Business as usual as Farmers & Merchants Savings Bank merges with FreedomBank

by Lissa Blake

It should be business as usual.

That’s what Farmers & Merchants Savings Bank (FMSB) Senior Vice President Dennis Lyons had to say about the merger of FMSB and FreedomBank, which becomes effective this week.

In November of last year, FreedomBank announced it would merge with FSMB. FreedomBank currently has offices in Elkader, Monona and Postville. FMSB has locations in Waukon and Decorah.

FMSB has been owned by members of the northeast Iowa community since its inception in 1925 (primarily Waterville and Waukon). It currently has over 70 shareholders who live locally or have roots in northeast Iowa. Arthur Jacobson (d.o.d. 1986) and his family have had a controlling interest in the bank since prior to it moving to Waukon in 1962.

FMSB Chief Operating Officer and Cashier Nancy Schoh said that long-time directors Herbert Dehli, Donald Bakke, Nancy Schoh, and Ethan and Sibyl Jacobson sought a transaction plan with a compatible community bank, that would not be disruptive to customers, employees or the community.

“The reason they chose to partner with FreedomBank was because it shares FMSB’s commitment to people and the community. The Jacobsons have always been very good to work with and for. They cared enough about the community and their employees to find a good partner going forward,” said Schoh.

Farmers & Merchants Savings Bank opened in 1925, after the existing First National Bank of Waterville was closed by its directors, due to depleting reserve funds. FMSB opened December 8, 1925 in Waterville, after being organized by a group of Waterville neighbors in order to provide banking services for their town and surrounding farm community.

In 1962, the bank expanded by opening an office in Waukon. Local Waukon and Waterville area residents came up with the $100,000 required to move its charter to Waukon. In 1985, the current FMSB building opened on West Main Street in Waukon.

Keith Garms, FreedomBank President and Board chair, said he has known the Arthur Jacobson family for more than 50 years. Garms explained FreedomBank is a 100-percent ESOP (Employee Stock Ownership Plan) owned bank, meaning the employees own shares of the bank through their pension plans.

He said in negotiations with the Jacobsons, his bank saw the addition of Waukon and Decorah as a “perfect fit” for FreedomBank.

“This is a great opportunity for us to expand our pension plan into their market and for their employees to participate,” said Garms. “This is a great way to keep local control and local ownership by having the employees use their pension funds to own FreedomBank.”

Schoh agreed the merger “presents a great opportunity for employees and the community.”

Uniting with Farmers & Merchants Savings Bank enlarges FreedomBank’s existing community bank footprint, which is dedicated to northeast Iowa.

As for what the merger will mean to customers, Lyons said it should be “business as usual.” The two FMSB locations will look the same and have the same staff, and decisions will continue to be made locally in each community.

“We also will have a new drive-up ATM in Waukon,” added Lyons.

Schoh said although FMSB will be changing its name to FreedomBank, customers will be able to maintain their same account numbers and use their existing bank forms, checks, etc. unless they are notified otherwise.

“Nothing will change. People can keep using the checks they have,” said Schoh.

The corporate merger took effect Monday, April 1. The operational merger will take place in June when FreedomBank customers will be able to transact business at all of the FreedomBank locations.

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