First Manitowoc Bancorp Inc. : Bank First reports 50% increase in Fourth Quarter Net Income

N E W S R E L E A S E

P.O. Box 10

Manitowoc, WI 54221-0010

For further information, contact:

Lisa M. O'Neill, Chief Financial Officer Phone: [phone] [e-mail]

Bank First reports 50% increase in Fourth Quarter Net Income

Manitowoc, January 23, 2014 - Bank First, subsidiary of the parent company First
Manitowoc Bancorp, Inc. (OTCQB: BFNC), today reported net income of $2.9 million, or
$0.45 per share for the fourth quarter 2013, as compared to $2.0 million, or $0.30 per share, for the fourth quarter 2012. For the year ended December 31, 2013, Bank First reported net income of $11.6 million, or $1.79 per share, as compared to $10.4 million, or $1.58 per share, for the year ended December 31, 2012.
"The growth of our core bank has generated 11% growth in annual earnings for 2013 as compared to 2012," said Mike Molepske, President and Chief Executive Officer at Bank First. "Our return on average assets was 1.15% for 2013, up from 1.11% in 2012. Our strong asset quality trends are also positively contributing to our profitability with a reduced provision for loan loss for 2013."
"The Bank First relationship-based model of growing one relationship at a time has yielded 13% loan growth and 6% core deposit growth on a year-over-year basis. Net interest income before provision for loan losses grew by $1.8 million, or 5%, for the year, reaching $34.1 million compared to $32.3 million in 2012," Molepske continued. "Our growth is being generated in all four regions of the bank with the majority of the growth generated in our newest offices. As we look ahead to 2014, we are executing our strategy for continued organic growth with our recent announcement to start a new office in the Appleton market. We will focus on adding new relationships in our footprint and delivering on our promise to our employees, customers and shareholders."
2013 Highlights:
• Total loans grew 13% in 2013 to $823 million, or $92 million of growth
• Total deposits grew 6% in 2013 to $919 million, or $50 million of growth
• Net interest margin was 3.82% for 2013, compared to 3.90% in 2012
• Nonperforming assets to total assets were 0.53%, compared to 0.96% at
December 31, 2012
• Return on average assets was 1.15%, up from 1.11% a year earlier
Operating Performance:
Interest income was $39.0 million for 2013, up $829,000 from $38.2 million in 2012. Interest expense was $4.9 million, down $934,000 from $5.8 million in 2012. As a result, net interest income grew by $1.8 million in 2013 to $34.1 million. Average loans increased by $72.7 million during 2013 and were generated primarily from our newest markets. Average deposits increased by $34.8 million with a majority of the growth generated in our headquarters Manitowoc County market.
Noninterest income was $6.7 million for the year 2013, down from $8.4 million in 2012. The decline in noninterest income resulted from losses on the sales of investment securities and a decline in residential mortgage activity in 2013 compared to 2012.
Noninterest expense was $22.8 million, down from $23.3 million in 2012. During 2013 we continued to invest in innovative products and solutions for our customers. We introduced mobile deposits for smart phone and the iPad app, demonstrating our investment on an easier banking experience for our customers.
The efficiency ratio decreased from 55.6% to 54.1% in 2013 due to growth in core banking, which more than offset the slowdown in mortgage refinancing activity. Full-time equivalent staff was 154 at December 31, 2013, compared to 166 for 2012.
Nonperforming assets decreased from $9.8 million at December 31, 2012, to $5.6 million at December 31, 2013. The improvement in asset quality is driven by a decline in other real estate owned, which was $3.0 million at December 31, 2013, down from $5.7 million in 2012. As a result of improving credit quality trends, provision expense for 2013 was lower than 2012 by $ 1.4 million.
Total assets are $1.06 billion at December 31, 2013, up 4% from $1.02 billion at December 31, 2012. Loan growth of $92 million during 2013 is the driver of asset growth. The newer markets in Sheboygan and Winnebago counties impacted the loan growth the most. Core deposits also exhibited strong growth with $50 million of growth generated from new relationships, as well as growth from our existing customer base.
Return on average assets was 1.15% for 2013, up from 1.11% for 2012. Return on average equity was 11.6%, up from 10.7% in 2012. Earnings growth has positively impacted capital ratios and is supporting the expansion plans for 2014.
"Our strong credit quality, improving profitability and sound capital base provide us with the opportunity to invest in talent, technology and resources as a recipe to deliver our Bank First service model in current and new markets," added Molepske. "We remain focused on growing high quality market share one relationship at a time in our footprint and in geographies adjacent to our footprint. This disciplined approach has translated into core revenue growth and sustained profitability," Molepske stated.

First Manitowoc Bancorp, Inc. (FMWC) provides financial services through its sole subsidiary, Bank First National, which was incorporated in 1894. The Bank is an independent community bank with 12 banking locations in Manitowoc, Brown, and Sheboygan and Winnebago counties. The Bank has grown through both acquisitions and de novo branch expansion. The Bank offers loan, deposit, investment advisory and trust products at each of its banking offices. Insurance products are available through Ansay & Associates, LLC. Trust, investment advisory and other financial services are offered through the Bank's partnership with Legacy Private Trust and through an alliance with Morgan Stanley Smith Barney. The Bank is a co-owner of a data processing subsidiary, United Financial Services, Inc., which provides data services for over 56

banks in Wisconsin, Missouri, Kansas, Illinois, and Arkansas. The Bank employs approximately 154 full-time equivalent staff and has assets of $1.1 billion as of December 31, 2013. Further information about First

Manitowoc Bancorp, Inc. is available by clicking on the Investor Relations tab at www.BankFirstNational.com .

First Manitowoc Bancorp is traded on the OTCQB marketplace under the symbol BFNC. The BFNC stock is traded on the OTC Markets Group platform that links to a diverse network of broker-dealers that provide liquidity and execution services in almost 10,000 equity and debt securities. To learn more about the OTC Markets Group visit www.otcmarkets.com

# # #

Forward Looking Statements: This news release may contain certain "forward-looking statements" that represent First Manitowoc Bancorp's expectations or beliefs concerning future events. Such forward-looking statements are about matters that are inherently subject to risks and uncertainties. Because of the risks and uncertainties inherent in forward looking statements, readers are cautioned not to place undue reliance on them, whether included in this news release or made elsewhere from time to time by First Manitowoc Bancorp or on its behalf. First Manitowoc Bancorp disclaims any obligation to update such forward-looking statements. In addition, statements regarding historical stock price performance are not indicative of or guarantees of future price performance.

FIRST MANITOWOC BANCORP, INC.

AND SUBSIDIARIES

Consolidated Balance Sheets

ASSETS	12/31/2013		12/31/2012		YOY Change
Cash and due from Banks	$ 26,448,045		$ 38,598,912		$ (12,150,867)
Interest-bearing deposits	45,186,559		72,562,389		(27,375,830)
Federal funds sold	129,395		453,532		(324,137)
Cash and cash equivalents	71,763,999		111,614,834		(39,850,835)
Securities available for sale, at fair value	109,650,433		117,954,713		(8,304,280)
Other investments, at cost	2,958,417		2,958,417		(0)
Loans held for sale	272,200		542,300		(270,100)
Loans	823,144,428		731,073,845		92,070,583
Allowance for loan loss	(8,755,151)		(7,949,992)		(805,159)
Loans, net	814,389,277		723,123,854		91,265,423
Premises and equipment, net	9,272,220		10,050,581		(778,361)
Goodwill	7,983,933		7,983,933		0
Intangible assets, net	57,509		75,670		(18,161)
Mortgage Servicing Rights	2,505,802		2,010,928		494,874
Investment in minority owned subsidiaries	14,745,738		14,170,254		575,484
Other real estate owned	2,976,156		5,567,117		(2,590,961)
Cash value of life insurance	19,841,558		19,752,669		88,889
Other assets	3,496,787		4,620,489		(1,123,702)
Total Assets	$ 1,060,886,569		$ 1,020,425,758		$ 40,460,811
LIABILITIES AND SHAREHOLDERS' EQUITY Deposits	919,486,423		869,162,768		50,323,655

Fed funds purchased

Securities sold under repurchase agreements

Borrowed funds Dividend Payable Notes payable Other liabilities Total liabilities

Stockholders' Equity

Common stock--$0.01 par value: Authorized--

20,000,000 shares Issued--6,714,252

Additional paid-in-capital

Retained earnings

Accumulated other comprehensive income

Treasury stock, at cost

Total stockholders' equity

- - -

30,844,504 43,098,904 (12,254,400)

- - -

445,204 - 445,204

1,815,000 2,820,040 (1,005,040)

6,727,568 9,250,593 (2,523,025)

959,318,699 924,332,305 34,986,394

67,146 67,146 0

2,608,071 2,451,266 156,805

103,631,067 93,472,830 10,158,237

1,050,099 3,058,177 (2,008,078) (5,788,513) (2,955,965) (2,832,548)

101,567,870 96,093,453 5,474,417

Total Liabilities and Stockholders' Equity

$ 1,060,886,569

$ 1,020,425,758

$ 40,460,811

FIRST MANITOWOC BANCORP, INC. AND SUBSIDIARIES Consolidated Statements of Income YTD

Interest/Dividend income:

YTD YTD YOY

12/31/2013 12/310/2012 change

Loans, including fees

$ 35,657,510

$ 34,413,326

$ 1,244,184

Federal funds sold

Securities: Taxable

Tax-exempt

Other

Total interest income

Interest expense: Deposits

Securities sold under repurchase agreements

Borrowed funds

Total interest expense

Net interest income

Provision for loan losses

Net interest income after provision

Noninterest income:

Wealth Management Revenue

Service charges Income from Ansay Loan servicing income Income from UFS

Net gain on sales of mortgage loans

Net loss on sales of securities

Other

Total Noninterest income

Noninterst expense:

Salaries, commissions, and employee benefits

Occupancy

Data processing

Loss on sales of OREO

Postage, stationery, and supplies

Advertising

Outside service fees Amortization of intangibles Other

Total Noninterest expense

Income before provision for income taxes

Provision for income taxes

Net income

YTD Average Shares outstanding

30,805 28,531 2,274

1,382,233 1,668,938 (286,705)

2,020,451 2,049,424 (28,973) (104,826) (3,214) (101,612)

38,986,173 38,157,005 829,168

4,527,049 5,185,739 658,690

235,579 487,420 251,841

116,374 139,760 23,386

4,879,002 5,812,919 933,917

34,107,171 32,344,086 1,763,085

1,475,000 2,900,000 1,425,000

32,632,171 29,444,086 3,188,085

95,874 79,484 16,390

2,488,307 2,868,642 (380,335)

964,698 1,196,235 (231,537)

1,226,718 967,074 259,644

913,563 682,848 230,715

1,066,156 1,874,471 (808,315) (906,224) (68) (906,156)

819,526 707,758 111,768

6,668,618 8,376,444 (1,707,826)

11,751,300 11,698,311 (52,989)

2,550,753 2,587,411 36,658

1,513,677 1,454,050 (59,627)

965,027 823,578 (141,449)

380,444 410,533 30,089

148,873 159,879 11,006

1,713,950 1,789,350 75,400

18,161 18,161 -

3,756,288 4,389,970 633,682

22,798,473 23,331,243 532,770

16,502,316 14,489,287 2,013,029

4,938,803 4,069,308 (869,495)

11,563,513 10,419,979 1,143,534

6,463,823 6,587,174 (123,351)

Earnings per share--common shareholders $

1.79 $

1.58 $

0.21

FIRST MANITOWOC BANCORP, INC.

AND SUBSIDIARIES Consolidated Quarterly Statements of Income

Interest/Dividend income:

12/31/2013 12/31/2012

Quarter over quarter Change

Loans, including fees

$ 9,106,027

$ 8,644,577 $

461,450

Federal funds sold

Securities: Taxable

Tax-exempt

Other

Total interest income

Interest expense: Deposits

Securities sold under repurchase agreements

Borrowed funds

Total interest expense

Net interest income

Provision for loan losses

Net interest income after provision

Noninterest income:

Wealth Management Revenue

Service charges Income from Ansay Loan servicing income Income from UFS

Net gain on sales of mortgage loans

Net loss on sales of securities

Other

Total Noninterest income

Noninterest expense:

Salaries, commissions, and employee benefits

Occupancy

Data processing

Loss on sales of OREO

Postage, stationery, and supplies

Advertising

Outside service fees Amortization of intangibles Other

Total Noninterest expense

Income before provision for income taxes

Provision for income taxes

71 11,148 (11,077)

- -

344,986 361,967 (16,981)

501,551 470,878 30,673 (29,010) 2,471 (31,481)

9,923,625 9,491,041 432,584

1,168,953 1,245,448 76,495

23,455 72,842 49,387

20,496 34,660 14,164

1,212,904 1,352,949 140,045

8,710,721 8,138,091 572,630

250,000 1,200,000 950,000

8,460,721 6,938,091 1,522,630

16,832 29,472 (12,640)

622,942 678,904 (55,962)

34,699 33,683 1,016

263,752 272,236 (8,484)

243,373 166,774 76,599

130,674 576,173 (445,499) (566,608) - (566,608)

255,791 182,768 73,023

1,001,455 1,940,009 (938,554)

2,984,357 2,917,754 (66,603)

566,911 607,215 40,304

375,958 381,150 5,192

128,736 687,815 559,079

91,659 95,186 3,527

33,121 28,503 (4,618)

449,777 593,350 143,573

4,540 4,540 0

820,186 1,080,219 260,033

5,455,245 6,395,732 940,487

4,006,931 2,482,369 1,524,562

1,138,609 519,695 (618,914)

Net income

$ 2,868,322

$ 1,962,674 $

905,648

QTR Average Shares outstanding

6,382,072 6,550,272 (168,200)

Earnings per share--common shareholders $

0.45 $

0.30 $

0.15

First Manitowoc Bancorp, Inc.

Financial Data

	Dec 2013 Actual YTD	Dec 2012 Actual YTD
Net Income and per share data
Net Income (Bank)	$12,058,589	$10,870,333
Net Income (Consolidated)	$11,563,515	$10,419,981
Earnings per Share (Consolidated)	$1.79	$1.58
Change over prior period	13.1%
Branch closing expense	$0	$0
Dividends (Holding Co.)	$703,280	$5,779,132
Dividend Payout Ratio (DPS/EPS)	6%	56%
Dividend Yield (DPS/Stock Price)	2.32%	5.71%
Book Value	$15.91	$14.71
Tangible Book Value less AFS impact	$14.48	$13.01
Tangible Book Value	$14.65	$13.48
Price Earnings Ratio	10.62	9.81
Book Value Multiple	1.19	1.05
Market Value	19.00	15.50
Period End Shares	6,384,432	6,531,121
Market Capitalization	121,304,208	101,232,376
Performance Ratios (1)
Net Interest Margin (YTD)	3.82%	3.90%
Fee Income to Total Revenue	16.35%	20.57%
Efficiency Ratio	54.14%	55.57%
ROA	1.15%	1.11%
ROE	11.60%	10.69%
FTE - period end	153.740	165.750
Avg. number of FTE	160.785	165.985
Earnings per Avg. Employee	71,919	62,777
Avg Assets per Avg. Employee	6,233,628	5,664,030
Selected Financial Condition (EOP)
Fed Funds Sold	$129,395	$453,532
Total Securities	$112,608,851	$121,032,787
Total Loans	$823,416,628	$731,616,145
Allowance for loan losses	$8,755,151	$7,949,992
Goodwill	$7,983,933	$7,983,933
Total Assets	$1,060,886,568	$1,020,425,758
Average Assets	$1,002,276,738	$940,144,007
Core Deposits	$919,486,423	$869,162,768
Total Deposits	$919,486,423	$869,162,768
Brokered Deposits (includes CDARS one-way buys)	$0	$0
CDARS Core Deposits	$9,915,504	$14,337,112
Other Borrowings	$1,815,000	$2,820,040
Repurchase Agreements	$30,844,504	$43,098,904
Total Wholesale Funding	$32,659,504	$45,918,944
Fed Funds Purchased	$0	$0
Total Equity	$101,567,869	$96,093,453
Average Stockholder's Equity	$99,694,434	$97,446,304

First Manitowoc Bancorp, Inc.

Financial Data

Balance Sheet Ratios

Loans to Deposits

Investments to Total Assets

Avg Earnings to Avg Bearing Liabilities Brokered Deposits to Total Deposits CDARS Deposits to Total Deposits Repos to Total Deposits plus repos Wholesale funding to total Liabilities Wholesale funding to Risk Based Capital

Asset Quality

Dec 2013

Actual YTD

90%

11%

135%

0%

1%

3%

3%

33%

Dec 2012

Actual YTD

83%

12%

130%

0%

2%

5%

5%

50%

Allowance for probable credit losses to toal loans	1.06%	1.09%
Net charge-offs to average total loans	0.08%	0.33%
Nonaccrual loans to total loans	0.31%	0.54%
Loans past due 30 days to total loans	0.08%	0.11%
Non-performing assets to total assets	0.53%	0.96%
Nonaccrual loans	2,570,864	3,959,183
Loans 90 days past due	45,988	276,980
Other Real Estate Owned	2,976,156	5,567,117
Non-performing assets	$5,593,008	$9,803,280
Provision for loan losses	$1,475,000	$2,900,000
Gross charge-offs	997,312	2,596,008
Recoveries	(327,471)	(165,737)
Net Charge-offs	$669,841	$2,430,271
Provision less charge-offs	$805,159	$469,729
Condensed Income Statement Short-term investment income	30,805	28,531
Investment securities income	3,089,228	3,613,966
Loan income	35,866,141	34,514,509
Total Interest Income	$38,986,175	$38,157,005
Deposit interest expense	4,527,049	5,185,739
Repo interest expense	231,219	483,809
Other borrowings interest expense	120,733	143,330
Total Interest Expense	$4,879,002	$5,812,919
Net interest income	34,107,173	32,344,086
Provision for loan losses	1,475,000	2,900,000
Net interest income after provision for loan loss	$32,632,173	$29,444,086
Noninterest income	6,668,617	8,376,443
Noninterest expense	22,798,472	23,331,240
Net Income before Taxes	$16,502,318	$14,489,289
Taxes	$4,938,803	$4,069,308
NET INCOME	$11,563,515	$10,419,981