HOMELAND BANKSHARES CORPORATION
March 19, 1996
Dear Shareholder:
You are cordially invited to attend the Annual Meeting of
Shareholders of Homeland Bankshares Corporation which will be
held at the main office of Homeland Bank, N.A. at 100 East Park
Avenue, Waterloo, Iowa, on Tuesday, April 16, 1996, at 7:00 p.m.
Shareholders of record as of February 23, 1996, will be entitled
to vote at the Annual Meeting.
In addition to the matters scheduled for consideration, your
Board of Directors and management are looking forward to meeting
with you and reviewing the major developments of 1995.
Whether you plan to attend or not, please mark, sign, date, and
return the proxy card in the accompanying envelope. Your vote is
important no matter how many shares you own. If you attend the
Annual Meeting and desire to vote in person, you may do so even
though you have previously sent in a proxy.
Sincerely,
/S/Erl A. Schmiesing
----------------------------
Erl A. Schmiesing
Chairman, President, and CEO
229 EAST PARK AVENUE P.O. BOX 5300 WATERLOO, IOWA 50704-5300
HOMELAND BANKSHARES CORPORATION
Waterloo, Iowa
NOTICE OF THE ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD APRIL 16, 1996
TO THE HOLDERS OF THE COMMON STOCK
OF HOMELAND BANKSHARES CORPORATION:
Notice is hereby given that the Annual Meeting of Shareholders
of Homeland Bankshares Corporation ("Homeland") will be held at
the main office of Homeland Bank, N.A. at 100 East Park Avenue,
Waterloo, Iowa, on Tuesday, April 16, 1996, at 7:00 p.m., for the
following purposes:
1. To elect two Homeland directors to terms of three years
as set forth in the accompanying Proxy Statement.
2. To transact such other business as may properly come
before the meeting or any adjournments thereof.
The Board of Directors has fixed the close of business on
February 23, 1996, as the record date for the determination of
the shareholders entitled to notice of and to vote at the Annual
Meeting. Accordingly, only shareholders of record at the close
of business on that date will be entitled to vote at the Annual
Meeting.
TO INSURE YOUR REPRESENTATION AT THE MEETING, THE BOARD OF
DIRECTORS OF HOMELAND SOLICITS YOU TO MARK, SIGN, DATE, AND
RETURN THE ACCOMPANYING PROXY IN THE ENCLOSED ENVELOPE WHETHER OR
NOT YOU PLAN TO ATTEND THE MEETING. YOUR PROXY MAY BE REVOKED AT
ANY TIME BEFORE IT IS EXERCISED AND IF YOU ARE ABLE TO ATTEND THE
MEETING AND WISH TO VOTE YOUR SHARES PERSONALLY, YOU MAY WITHDRAW
YOUR PROXY TO DO SO.
By Order of the Board of Directors
Dated: March 19, 1996
/S/Erl A. Schmiesing
-----------------------------
Erl A. Schmiesing
Chairman, President, and CEO
HOMELAND BANKSHARES CORPORATION
229 East Park Avenue
P. O. Box 5300
Waterloo, Iowa 50704-5300
PROXY STATEMENT FOR THE ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD APRIL 16, 1996
This Proxy Statement is furnished to the shareholders of
Homeland Bankshares Corporation ("Homeland") in connection with
the solicitation of proxies by the Board of Directors of Homeland
to be used at the Annual Meeting of Shareholders on April 16,
1996, or at any adjournment thereof, for the purposes set forth
in the accompanying Notice of the Annual Meeting of Shareholders.
The expense incurred in preparing, assembling, and mailing the
Proxy Statement and accompanying Notice of meeting and form of
proxy will be borne by Homeland. The Proxy Statement and
accompanying Notice of meeting, form of proxy, and Homeland's
1995 Annual Report on Form 10-K were mailed to each shareholder
at such holder's address of record commencing on or about March
19, 1996.
Only shareholders of record of the $12.50 par value Common
Stock on the books of Homeland at the close of business on
February 23, 1996 will be entitled to notice of and to vote at
the Annual Meeting. On February 23, 1996, Homeland had 5,740,513
shares of Common Stock issued and outstanding. The presence, in
person or by proxy, of the holders of a majority of such
outstanding shares entitled to vote at the Annual Meeting shall
constitute a quorum. Each shareholder of record of Common Stock
of Homeland as of the record date will be entitled to one vote
for each share of stock held of record in such shareholder's
name. Shareholders do not have cumulative voting rights. There
are no appraisal or similar rights of dissenters applicable to
any matter to be voted upon at the Annual Meeting.
All proxies delivered pursuant to this solicitation are
revocable at the option of the person executing the proxy at any
time before the voting thereof. Proxies in the form enclosed,
unless previously revoked, will be voted at the meeting. Where a
choice is specified by a shareholder by means provided in the
proxy, the proxy will be voted in accordance with such
specification. If no direction is given as provided in the
proxy, the proxy will be voted FOR the matters presented in this
Proxy Statement. Abstentions will be treated as unvoted for
purposes of determining the approval of any matter submitted to
the shareholders for a vote. If shares are held by a broker
which has indicated that it does not have discretionary authority
to vote on a particular matter, those shares will not be
considered as present and entitled to vote with respect to that
matter.
ELECTION OF DIRECTORS
Homeland's Articles of Incorporation provide that the number
of directors shall be not less than four nor more than twenty,
the exact number to be determined from time to time by resolution
adopted by a majority of the entire Board of Directors, or by
resolution of the shareholders at any meeting thereof. In
January 1996, the Board of Directors set the number of directors
at seven.
The Articles of Incorporation also provide that the Board of
Directors shall be divided into three classes as nearly equal in
number as possible, with the term of office of one class expiring
each year. At the Annual Meeting, two Class III directors will
be elected to a three-year term expiring in 1999. Both nominees
are incumbent Homeland directors, and none of Homeland's
directors or executive officers are related to each other.
The nominees for election and the Homeland directors whose
terms continue beyond the Annual Meeting are identified in the
following table:
DIRECTOR CURRENT POSITION PRINCIPAL OCCUPATION
NAME AND AGE SINCE WITH HOMELAND DURING PAST FIVE YEARS
------------ -------- ---------------- ----------------------
NOMINEES FOR TERMS EXPIRING IN 1999
(CLASS III DIRECTORS)
Erl A. Schmiesing 1990 Chairman, Chairman of Homeland
56 President, CEO since April 1992;
and Director President & CEO
of Homeland
since 1990
Douglas K. Shull 1987 Director Treasurer, Casey's
53 General Stores, Inc.,
Des Moines, Iowa
CONTINUING DIRECTORS WHOSE TERMS EXPIRE IN 1997
(CLASS I DIRECTORS)
James E. McKinstry 1986 Director President, Nelson
67 Manufacturing Company,
Cedar Rapids, Iowa
James R. Walker 1984 Director President, Walker's
64 Shoe Stores, Waterloo,
Iowa
Herbert E. Williams 1982 Director President and CEO,
67 The POS Corporation,
Waterloo, Iowa
CONTINUING DIRECTORS WHOSE TERMS EXPIRE IN 1998
(CLASS II DIRECTORS)
Joy C. Corning 1986 Director Lieutenant Governor
63 of Iowa since 1991
Robert S. Kahler 1993 Executive Vice Executive Vice President
44 President, CFO, and CFO of Homeland
and Director
The shareholders will be asked to elect each of the nominees
for Class III director to a term of three years. In the event
that either nominee should become unavailable for election, the
proxy will be voted for such substitute, if any, as the Board of
Directors may designate, unless the authority to vote for all
nominees is withheld. An affirmative vote of a majority of the
shares present in person or by proxy and entitled to vote at the
Annual Meeting is required for the election of each director.
Some of the directors of Homeland are also directors of
certain subsidiaries of Homeland. Mr. Schmiesing is Chairman and
a director of Homeland Bank, N.A. Mr. Kahler is a director of
Homeland Savings Bank, FSB and Homeland Bank in Oelwein. Messrs.
Walker and Williams are directors of Homeland Bank, N.A. Mr.
Shull is a director of Homeland Bank in Indianola and is also a
director of Casey's General Stores, Inc.
BOARD OF DIRECTORS COMPENSATION
During 1995, Homeland directors who were not employees of
Homeland or any of its subsidiaries each received an annual
retainer fee of $1,200, as well as a fee of $600 for each regular
or special Board meeting attended and $200 for each Board
committee meeting attended. Such director fees aggregated
$29,000 in 1995. Messrs. Schmiesing and Kahler, both of whom
were employees, did not receive any compensation for services
rendered as Homeland directors.
During 1995, the Board of Directors of Homeland held eight
regular meetings with all incumbent directors attending 75% or
more of the total number of meetings held during their respective
terms of service, except Joy C. Corning, who attended 5 of the 8
meetings.
BOARD OF DIRECTORS COMMITTEES
The Homeland Board of Directors does not have standing
nominating or compensation committees. The only standing
committee of the Board of Directors of Homeland is the Audit
Committee, which during 1995 consisted of Homeland director James
R. Walker and outside directors from Homeland's subsidiaries.
Included among the functions performed by the Audit Committee are
the review of the scope and results of audits conducted by
Homeland's independent auditors, review of the scope and results
of audits performed by Homeland's internal auditors, and review
of reports resulting from regulatory examinations of Homeland and
its subsidiaries. The Audit Committee annually appoints
Homeland's independent auditors subject to approval by the
Homeland Board of Directors.
During 1995, the Audit Committee held four meetings, of which
all incumbent members attended 75% or more of the total number of
meetings held during their respective terms of service.
TRANSACTIONS WITH MANAGEMENT
Homeland and its subsidiaries have had in the past, and may
have in the future, banking transactions in the ordinary course
of business with their directors, executive officers, and
associates of such persons. Loans made by the subsidiaries of
Homeland to these persons were made on substantially the same
terms, including interest rates and collateral, as those
prevailing at the time of origination for comparable transactions
with other persons, and, in the opinion of management of
Homeland, did not involve more than the normal risk of
collectability or present any other unfavorable features.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Since Homeland has no compensation committee, determinations
regarding compensation of its executive officers are made by the
Homeland Board of Directors as a whole. A similar situation
exists at each of its subsidiaries. Erl A. Schmiesing, director,
Chairman, President, and CEO of Homeland, and Robert S. Kahler,
director, Executive Vice President and CFO of Homeland abstain
from voting on matters regarding their compensation.
Mr. Schmiesing is also an executive officer and director of
Homeland Bank, N.A. Mr. Kahler is also an executive officer of
Homeland Bank, N.A., as well as a director of Homeland Savings
Bank, FSB and Homeland Bank in Oelwein. The Board of Directors
does not believe that these relationships have provided Mr.
Schmiesing or Mr. Kahler with any compensation arrangements or
authority which are more favorable than would have otherwise been
granted to them by the Board of Directors for the capacities in
which they serve.
EXECUTIVE COMPENSATION
The following discussion sets forth information concerning
compensation for executive officers of Homeland. Executive
officers for purposes of this Proxy Statement include only the
key policy-making officers of Homeland and its subsidiaries. The
tables show information for Homeland's chief executive officer
and the other executive officers who each received aggregate
salary and bonus payments in excess of $100,000 for the year
ended December 31, 1995.
<TABLE>
SUMMARY COMPENSATION TABLE
<CAPTION>
LONG TERM
ANNUAL COMPENSATION COMPENSATION
----------------------------- ------------
NAME AND OTHER ANNUAL OPTION ALL OTHER
PRINCIPAL POSITION YEAR SALARY BONUS COMPENSATION AWARDS COMPENSATION(1)<F1>
------------------ ----- ------ ----- ------------ ------ ---------------
<S> <C> <C> <C> <C> <C> <C>
Erl A. Schmiesing 1995 $193,000 $20,000 $ --- --- $11,256
Chairman, President 1994 175,175 21,000 --- 3,000 11,711
& CEO of Homeland 1993 165,000 18,000 --- --- 21,975
Robert S. Kahler 1995 $144,000 $17,000 $ --- --- $ 8,256
Executive Vice 1994 125,175 17,500 --- 3,000 11,556
President & CFO 1993 105,000 12,000 --- --- 14,129
of Homeland
Josef M. Vich 1995 $125,000 $16,500 $ --- --- $10,618
President and CEO 1994 92,175 13,000 --- 2,000 8,607
of Homeland Bank, 1993 70,000 7,000 --- --- 9,158
N.A.
Gregory L. O'Hara 1995 $162,000 $12,960 $ --- --- $11,256
President and CEO of 1994(2)<F2> 162,000 8,400 --- --- 6,164
Homeland Savings
Bank, FSB
<FN>
(1)<F1> Homeland has a qualified profit sharing plan covering all
eligible employees of Homeland and its subsidiaries who have
reached age 21 and have completed at least one year of service.
Upon reaching normal retirement age of 65, a participant may
receive benefits in either a lump-sum distribution or in the form
of periodic payments over the estimated life expectancy of the
participant and the participant's beneficiary. Vesting occurs over a
seven-year period of service. Annual employer contributions to the
profit sharing plan are determined by the Board of Directors of
Homeland. During 1995, a 401(k) feature was added to the plan
whereby Homeland matches 50% of a participant's contribution
up to 4% of the participant's annual compensation for a 2%
maximum matching employer contribution. Amounts shown represent
employer profit sharing contributions and/or 401(k) matching contri-
butions.
(2)<F2> Mr. O'Hara's employment commenced on June 1, 1994 when Homeland
acquired Homeland Savings Bank as a wholly-owned subsidiary. In
connection with the acquisition, Mr. O'Hara entered into a contract
with Homeland under which he agreed to remain employed by Homeland
and to not compete with Homeland or any of its subsidiaries for a
two-year period ending June 1, 1996. The prorated salary actually
paid for the seven months ended December 31, 1994 was only $94,500.
</FN>
</TABLE>
<TABLE>
AGGREGATED OPTION EXERCISES IN 1995 AND DECEMBER 31, 1995 OPTION VALUES
<CAPTION>
VALUE OF UNEXERCISED
NUMBER OF UNEXERCISED IN-THE-MONEY
OPTIONS AT OPTIONS AT
DECEMBER 31, 1995 DECEMBER 31, 1995
SHARES ACQUIRED EXERCISABLE/ EXERCISABLE/
NAME ON EXERCISE VALUE REALIZED UNEXERCISABLE UNEXERCISABLE
----------------- --------------- -------------- --------------------- --------------------
<S> <C> <C> <C> <C>
Erl A. Schmiesing --- $--- ---/3,000 $---/19,500
Robert S. Kahler --- --- ---/3,000 ---/19,500
Josef M. Vich --- --- ---/2,000 ---/13,000
Gregory L. O'Hara --- --- ---/--- ---/---
</TABLE>
PENSION PLAN
Homeland has a qualified noncontributory defined benefit
pension plan which covers all eligible employees of Homeland and
its subsidiaries. In general, full-time employees who have
reached age 20-1/2 and have completed at least 6 months' service
are participants in the pension plan.
The pension plan's normal retirement benefit is 1% of a
participant's average compensation multiplied by the number of
years of service from the later of January 1, 1976 or a
participant's date of hire to the normal retirement date of age
65, not to exceed 25 years' total service. Average compensation
is the final average annual base salary and bonus for the highest
consecutive five plan years in the last ten years of service
prior to the normal retirement date. The normal benefit is in
the form of a monthly income over the life of the participant. A
participant may elect early retirement with full vesting at any
time after age 55. Plan benefits are not reduced by social
security benefits or other offset amounts. There is no vesting of
plan benefits until a participant has completed five years of
service at which time the plan benefits become 100% vested.
Each eligible employee's retirement benefit under the pension
plan is restricted by an Internal Revenue Code ("IRC")
compensation limitation of $150,000. The following table shows
estimated annual pension plan retirement benefits available to
employees at the normal retirement age of 65 subject to the IRC
compensation limitation at December 31, 1995:
AVERAGE COMPENSATION YEARS OF SERVICE
FOR HIGHEST CONSECUTIVE ----------------------------------------------
5 PLAN YEARS 10 YEARS 15 YEARS 20 YEARS 25 YEARS 30 YEARS
----------------------- -------- -------- -------- -------- --------
$125,000 $12,500 $18,750 $25,000 $31,250 $31,250
150,000 15,000 22,500 30,000 37,500 37,500
175,000 15,000 22,500 30,000 37,500 37,500
200,000 15,000 22,500 30,000 37,500 37,500
225,000 15,000 22,500 30,000 37,500 37,500
250,000 15,000 22,500 30,000 37,500 37,500
SUPPLEMENTAL RETIREMENT INCOME PLAN
To compensate for the $150,000 IRC defined benefit pension
plan compensation limitation, Homeland adopted a nonqualified
Supplemental Retirement Income Plan in 1995. The four executive
officers named in the Summary Compensation Table participate in
the supplemental plan. The plan provides for payment of annual
supplemental retirement benefits equal to 50% of the executive
officer's highest annual salary and bonus compensation during the
five years prior to normal retirement age of 65, reduced by
benefits available to the executive officer under Homeland's
defined benefit pension plan. The executive officer must have a
minimum of 10 years of service to receive any retirement benefits
and 20 years of service by age 65 to receive the maximum annual
benefits.
The annual benefits are payable to the executive officer for
15 years following retirement, or to the surviving spouse or
other designated beneficiary in the event of death during the 15-
year period following retirement. If death occurs during the
executive officer's active employment, a continuation benefit of
50% of base salary at the time of death will be paid for one
year, then a survivor's benefit of 25% of the highest annual
salary and bonus during the five years prior to death will be
paid to the surviving spouse or other designated beneficiary for
a period of 14 years. In the event of early retirement (after
age 55 but prior to age 65), benefits will be reduced at the rate
of 1% per year for each year prior to age 65 that retirement
occurs and 1% for each year of service or credited service less
than 20 years accumulated by the executive officer. For example,
if retirement occurs at age 60 with 15 years of service, benefits
are reduced by 5% for the early retirement due to age, and
another 5% for service less than 20 years making a total targeted
benefit of 40%.
In the event Homeland were to be acquired, an executive
officer under the plan with at least five years of service whose
employment is terminated would be immediately vested with a
benefit payment equal to 15% of annual compensation at the time
of such event payable for 15 years. This provision will not
affect any payments provided under any other contract or
agreement between Homeland and the executive officer.
Notwithstanding the above, should the executive officer have a
greater benefit under the plan by electing either early or normal
retirement, the executive officer shall receive the greater of
the vested benefit or the supplemental retirement income benefit.
Homeland has purchased life insurance on the executive
officers sufficient in amount to actuarially finance all future
liabilities under the plan. Homeland is the owner and the
beneficiary of the life insurance. The plan has been designed so
that if the assumptions made as to mortality, experience, policy
dividends, and other factors are realized, Homeland will fully
recover the cost of all insurance premium payments made over the
life of the plan.
The following table shows the estimated annual benefits
payable at the normal retirement age of 65 under the Supplemental
Retirement Income Plan at December 31, 1995:
HIGHEST ANNUAL
COMPENSATION YEARS OF SERVICE
DURING 5 YEARS ------------------------------------------------
PRIOR TO RETIREMENT 10 YEARS 15 YEARS 20 YEARS 25 YEARS 30 YEARS
------------------- -------- -------- -------- -------- --------
$125,000 $37,500 $37,500 $37,500 $31,250 $31,250
150,000 45,000 45,000 45,000 37,500 37,500
175,000 55,000 56,250 57,500 50,000 50,000
200,000 65,000 67,500 70,000 62,500 62,500
225,000 75,000 78,750 82,500 75,000 75,000
250,000 85,000 90,000 95,000 87,500 87,500
1995 COMPENSATION COVERED BY RETIREMENT PLANS
<F2>
<F1> SUPPLEMENTAL NORMAL
PENSION RETIREMENT CREDITED YEARS RETIREMENT
NAME PLAN(1) INCOME PLAN(2) OF SERVICE DATE
----------------- ------- -------------- -------------- ----------
Erl A. Schmiesing $150,000 $213,000 20 years April 1, 2005
Robert S. Kahler 150,000 161,000 12 years April 1, 2017
Josef M. Vich 141,500 141,500 6 years October 1, 2012
Gregory L. O'Hara 150,000 174,960 1 year March 1, 2019
(1)<F1> Amounts represent the eligible salary and bonus shown
in the Summary Compensation Table, subject to an IRC limitation
of $150,000.
(2)<F2> Amounts represent the eligible salary and bonus shown
in the Summary Compensation Table.
CHANGE OF CONTROL AGREEMENTS
At December 31, 1995, Homeland had change of control
agreements with eleven key officers of the company, including
Messrs. Schmiesing, Kahler, and Vich, to provide certain benefits
to those officers in the event of termination of their employment
within two years following a change of control of the company.
These agreements provide for a lump-sum payment in the amount of
2.5 times the officer's includible compensation as defined within
the agreement in the case of Messrs. Schmiesing and Kahler, and
1.5 times the officer's includible compensation in the case of
the other nine officers. Includible compensation is the average
of the annual compensation computed in the manner as shown in the
Summary Compensation Table for the five years immediately
preceding the date of change of control. The lump-sum payment
would be made within thirty days after the effective date of the
officer's termination.
REPORT ON EXECUTIVE COMPENSATION
Compensation for executive officers of Homeland is based on
performance appraisals, each officer's position, and total
dollars allocated in the budget for compensation, and is
determined through a process which begins with formal written
performance appraisals and documented oral interviews prepared
and conducted by Erl A. Schmiesing, Chairman, President, and CEO
of Homeland. Mr. Schmiesing then prepares recommendations for
compensation of the executive officers (including himself) for
proposal to and discussion by the Board of Directors as a whole.
In reviewing the proposals and determining the compensation to
be paid to the executive officers in 1995, the Board of Directors
employed compensation policies designed to align the compensation
with Homeland's overall business strategy, values, and management
initiatives. These policies are intended to motivate key
executives to achieve strategic business initiatives and reward
them for long-term achievement of goals aimed at enhancing
shareholder value, to attract and retain talented executives
whose abilities are critical to the long-term success and
competitiveness of the company, and to align the interests of
executives with the long-term interests of shareholders through
award opportunities that can result in ownership of Homeland
Common Stock. In administering the compensation policies of
Homeland, the Board of Directors also compares the company's
performance with performance levels of other comparable financial
institutions.
Homeland utilizes a study prepared exclusively for Homeland by
the consulting firm of William M. Mercer Incorporated to assist
in the design of its executive compensation program. The key
components of Homeland's executive compensation program are
salary, cash bonuses, corporate profit sharing, and incentive
stock options. An executive officer's salary is based on
factors such as the individual officer's level of responsibility
and comparisons to similar positions in financial institutions
within Homeland's market area. Cash bonus awards are based on
individual performance and profit sharing contributions are based
on the achievement of the financial performance goals of the
company, as established in annual budgets and in the long-term
strategic planning process. The goals are measured primarily in
terms of earnings per share, asset quality, return on assets, and
return on stockholders' equity. Incentive stock options are
intended to increase the motivation for an interest in the
company's long-term success, as measured by Homeland's per share
market price and book value.
The Board of Directors based the 1995 compensation of the
chief executive officer, Erl A. Schmiesing, on the policies and
factors described above, taking into consideration the William M.
Mercer Incorporated study as well as comparisons with the
salaries of chief executive officers of comparable financial
institutions. The cash bonus and profit sharing contribution
awarded to Mr. Schmiesing for 1995 were in recognition of his
individual performance and the progress of the company in
achieving its financial goals during the year, as determined by
the Board of Directors.
THE BOARD OF DIRECTORS OF HOMELAND BANKSHARES CORPORATION
Joy C. Corning James E. McKinstry Douglas K. Shull
Herbert E. Williams Robert S. Kahler Erl A. Schmiesing
James R. Walker
FINANCIAL PERFORMANCE
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN AMONG
HOMELAND, NASDAQ MARKET INDEX, AND INDUSTRY INDEX(1)<F1>
1990 1991 1992 1993 1994 1995
---- ---- ----- ---- ----- ----
Homeland $100 $107 $148 $170 $166 $221
Nasdaq $100 $128 $130 $156 $163 $212
Industry Index $100 $171 $216 $241 $246 $365
(1)<F1> Cumulative total return assumes $100 was invested on December
31, 1990 and dividends were reinvested. The industry index shown is
the Media General Financial Services' West North Central bank
index.
MANAGEMENT OWNERSHIP OF COMMON STOCK
The following table shows the number of shares of Homeland
Common Stock beneficially owned by each Homeland director, by
each executive officer listed in the Summary Compensation Table,
and by all directors and executive officers as a group as of
January 31, 1996.
<TABLE>
<CAPTION>
OF SUCH BENEFICIAL OWNERSHIP,
SHARES TO WHICH THE
BENEFICIAL OWNERSHIP BENEFICIAL OWNER HAS:
------------------------- -----------------------------
SHARES SOLE VOTING SHARED VOTING
BENEFICIALLY PERCENT AND INVESTMENT AND INVESTMENT
NAME OWNED(1)<F1> OF CLASS POWER POWER
------------------ ------------ -------- -------------- --------------
<S> <C> <C> <C> <C>
Joy C. Corning 50,328 .88 50,000 328
Robert S. Kahler 3,000 .05 3,000 ---
James E. McKinstry 92,020 1.60 92,020 ---
Gregory L. O'Hara 2,000 .03 2,000 ---
Erl A. Schmiesing 29,000 .51 20,704 8,296
Douglas K. Shull 1,084 .02 1,084 ---
Josef M. Vich 3,541 .06 2,550 991
James R. Walker 6,060 .11 4,276 1,784
Herbert E. Williams 10,020 .17 8,744 1,276
All directors and
executive officers
as a group
(16 persons) 232,323 4.05 193,216 39,107
<FN>
(1)<F1> For purposes of this Proxy Statement, beneficial ownership is
deemed to include shares owned (a) personally by the director or
executive officer, (b) by the spouse or minor children of the
director or executive officer or any relative having the same home
as the director or executive officer, and (c) by any trust in
which the director or executive officer has or shares voting
power or investment power over the shares.
</FN>
</TABLE>
Based on information furnished to Homeland as of January 31,
1996, all directors and executive officers complied with
beneficial ownership reporting requirements of Section 16 (a) of
the Securities Exchange Act of 1934 for 1995, except executive
officer Everett P. Brown, who filed one late report for one
common stock purchase transaction.
PRINCIPAL HOLDER OF COMMON STOCK
No individual shareholder known to management owns
beneficially in excess of 5% of Homeland's Common Stock. As of
December 31, 1995, the Trust Division of Homeland Bank, N.A., 229
East Park Avenue, Waterloo, Iowa 50704-5300, was the owner, in a
fiduciary capacity, of 585,278 shares (10.20%) of Homeland Common
Stock and had sole voting control and shared voting control over
224,827 (3.92%) and 360,451 (6.28%) of such shares, respectively.
INDEPENDENT AUDITORS
The Board of Directors of Homeland has again selected Deloitte
& Touche LLP, independent auditors, to audit the consolidated
financial statements and related disclosures of Homeland for the
year 1996 and to render their independent auditors' report
thereon. Representatives of Deloitte & Touche LLP are expected
to be present at the Annual Meeting with the opportunity to make
a statement if they desire to do so and to be available to
respond to appropriate questions.
SHAREHOLDER PROPOSALS
Any shareholder proposals intended to be presented at the 1997
Annual Meeting of Shareholders must be received by Homeland no
later than November 16, 1996 for inclusion in the 1997 Proxy
Statement and form of proxy. Shareholder proposals should be
sent to: Chairman, Homeland Bankshares Corporation, P.O. Box
5300, Waterloo, Iowa 50704-5300.
OTHER MATTERS
The Board of Directors does not know of any other matters
which may come before the Annual Meeting. However, if any other
business properly comes before the Annual Meeting, or any
adjournments thereof, proxies will be voted upon any such matter
in accordance with the discretion of the persons named thereon.
By Order of the Board of Directors
/S/Erl A. Schmiesing
----------------------------
Erl A. Schmiesing
Chairman, President, and CEO
[Form of Proxy]
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
HOMELAND BANKSHARES CORPORATION
PROXY FOR THE ANNUAL MEETING OF SHAREHOLDERS ON APRIL 16, 1996
The undersigned hereby constitutes and appoints Elcina M. Buck
and David R. Mason, or either of them, the proxies and attorneys
for the undersigned, each with full power of substitution, for
and in the name, place, and stead of the undersigned to attend
the Annual Meeting of Shareholders of Homeland Bankshares
Corporation to be held at the main office of Homeland Bank, N.A.
at 100 East Park Avenue, Waterloo, Iowa, on Tuesday, April 16,
1996 at 7:00 p.m., and any adjournments thereof, and to vote as
directed below all shares of Common Stock held of record by the
undersigned on February 23, 1996, with all powers the undersigned
would possess if personally present at such meeting.
1. Election of Class III Directors whose terms expire in 1999
(mark only one box):
TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE,
STRIKE A LINE THROUGH THE NOMINEE'S NAME.
// FOR all Class III nominees listed below (except as marked
to the contrary below)
// WITHHOLD AUTHORITY on all Class III nominees listed below
Erl A. Schmiesing Douglas K. Shull
2. In their discretion, upon such other matters as may
properly come before the meeting or any adjournments
thereof.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER
DIRECTED HEREIN BY THE SHAREHOLDER. IF NO DIRECTION IS GIVEN,
THIS PROXY WILL BE VOTED FOR THE MATTERS LISTED ABOVE.
Shareholders who are present at the meeting may withdraw their
proxies and vote in person if they so desire.
(Continued on reverse side)
[side one]
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(Continued from reverse side)
PLEASE MARK, SIGN, DATE, AND RETURN THIS PROXY PROMPTLY
USING THE ENCLOSED ENVELOPE
(Please sign exactly as your name appears on this proxy. When
signing in a representative capacity such as guardian,
attorney, trustee, or executor, please indicate your full title
as such. Proxies by a corporation should be signed in its name by
an authorized officer. Proxies by a partnership should be signed
in its name by an authorized person. If more than one name appears,
all persons so designated should sign.)
The undersigned hereby acknowledges receipt of the Notice of
the Annual Meeting of Shareholders and Proxy Statement dated
March 19, 1996.
Dated ___________________, 1996
Signature_________________________
Signature_________________________
[side two]
