JUN 1 22011FR Y{OllB Nunb.r 710114297Am{EYd.ariE S.DLmbcr 3lr, 20ltP.gr t d2

Board of Governorc of the Fedsral Rsserve System

Annua Report of Holding Companies-FR Y-G

Reportattheclose ofbuslness as oflhe end offiscal year

Thls Report is required by lam Section fcXtXA) of lhe BankHotding Cornparry Acl (12 U.S.C. S lBaa(c[l[A)); seclions 8(a)and l3(a) of lhe lntemational Bankirp Act (12 U.S.C. SS 310(a)and 3108(a)); sections 11(aX1). 25, and 25A ot the FederalReserve Act (12 U.S.C. SS 248(aXl), 602, and 611a); and sec-tlons 1'13, 165, 312, 618, and 809 ol lhE Doddfrank Act (12 U.S.C.

SS 5361,536s,5412. 1850{cXi). and 5468(b[1)). Retum to thoappmpdate Federal Reserv€ Bank the origlnal and the number ofcopies specjlied.

This report lorm is to b€ liled by all toptier bank hdding oompa-nies, toplier savlngs and loan holdirq companles, and U.S. lnler-medial8 holdhg companles organlzed urdar U.S. lar, and byany forepn banklng organtsallon lhat do€s nol me€t lhe require-ments of and ls not treated as a qualityittg foreQn banking orga-nization under Section 211.?3 ot Regulation K (12 C.F.R. S211.23). (See page one of lhe general lmlrudirns for morE delailol who must frle.) The Federal Resenre rnay not mnduct or sporl-sor, and an organizalion (or a person) is not requir€d to respondto, an lnfonnation collection unless lt displays a annenUy validOMB control number.

NOTE: The Annual Repod ol Ho6irp Companiesmust be slgned byone dlreclor of lhe toplier holding corpany. This indivilual shouHalso be a senior otrrial ol lhe toptier holding company. ln the evenlthat the topthr hotsing company does not have an indivilual who b6 senlor ofrcial and is also a dileclor, he draiman of thc board mustsign lhe report. lf lhe holding company is an ESOP/ESOT formed asa corporation or is an LLC. see the Genenl lnsEudhns for fieauthorized individual who must sQn lhe repo(l. Mike Broussard

Name olthe Holdhg Comprny Dioclorand Ofric'ral

Presldentffie o, tha Holding Compony Oireclor and OtrtcEl

alt$t that lhe Annual Repod ol Holding @mpanbs (hcludingthe supporling atlachments) for this report date has been prepared ln conformance wih he inslructirns issued by the FderalReserve Syslem and are lrue and conect lo the best of mykrnwledge and belief.

Mlh raspect lo inlormatkn rryatdiq idlviduals contained in lhisrcpod. the Rapder crldifus lhal it has the aullnrily lo provide thisinlomahon lo lhe ftdenl Reserve. The Repoder also certifresthal il has the authority, on hehall of aail idividual, lo cnnsenl orobjecl lo public release of inlormatim ngading thst individualThe Federcl Reserve may assume, in the ebsencr of a nquesl lornnfrdenlial lrealment submitted in awdlangB with lhe Board's'Rules Regarding Availabihty of lnlomafion,' 12 C.ER, Pad 261,that lha Reporlar and individual ansent to public raloa* ol all

Date of Report (top-tier holding corpany's fscal year-end):

_DscglEer tt..?0_19_Mo.rlh, Oay, Year

LEI: NoneRogo(cr'. Lrgal Enlity rd€nrifier (LEl) (204hat"dd LEI Co.rol

Reporle/s Name. Skeet, and Mailing Address

grrqd etfl E-Eer[gh a-tw- I

Lcaal f,ll. ol Hoklirg Co{npsny

PO Box 1621(Maling Addroas of lho Holdirqg Companll SM I PO Eor

Levelland TXCity SlalG

79336Zip Codo

!9 t s._!legs_!!er4fe, _s_u !9grn, r x'l 937_2_ _

Physic.l Localirn (i, dillsleal lrom malLrg addtEts,

Person to whom quesUons about 0ris reporl should be dlrecled:Mike Broussard PresidentNam6

806-894-7799filc

Aroa Code / Phons Nurnbcr, Eflensbn

806-834-2789Arae Code / FAX Nunb€r

delailsin tha Ep,l @nceming lhal individual mbroussard@sundownsb.com

SaglnElur! ot Holding C€rDprny Oirlclor ard Offcbl

FEBRUARY 22, 2OI7Date ol

For Federal Reaewe Bank Use Only

RSSD IDc.l.

ltD.{ )7 1

PUUE .roofin0 hjrdGn hr lhrs rnto,meton colladro.r 6 crumrtrd lo vafy lrdr I 3 lo tol hou6 9€r EDon3r, ulh rn ncragu d 5 50 horr! pat ,laponsi ndudhg tmc b galhd &16

Of,cr of UeugEncttl .Ird BdgGl, Prpcflffit Fl.Aldton FtE ccl (?100{297}. Wrilvrgtm, OC 20503 f 22016

E+ne Addrs*

.NJAfaahss 1Unll tor Uia Holdi rg Comp.rfi w€b page

For lmlding companias astlragislsed with lhe SEl+lndlcale gatu3 otAnnual Repod to SharehddeG

EJ ts tncUaeO wilh the FR Y{ reporlE wu Ue s€flI undar sopErale cover

E rnapreparea

0rXo

lrYu 0ls conndenual fo.bn nl requ6t.d for lny pordmd thlr rcport submlagloo?...,ln accordance wltlr ahe Goned lnstrucdom for lib rsport(chcdr mty crol,

1. E lottGrluitlfylng 0rlt rsqu$t ls b€lng prcvldod along

2 a bttlrlurUfylng thlt r.qucat hrt beGn provlded

NOIE: lnformauo.r for wltl.fi confidqr6.l tratlmolrl 13 bdngroqrertad must be provldsd rcparalrly rnd laboladrs'cocfidcnUal-

rfwtlh the Gport

tcplrrlcly...,.

t

sIJI'itDOWt{ INC.

100'/t

SUND(,-WI{STATEBAIiIK$NIX}WN,TEXAS,USA

nICORPORATED IN TEXAS

No i,H isA'raihble

a{i,t:

I{AR -g 201?

NIG

tC

E

E

I3 3 3

G

t,Et=BEo;=32

6 3

E

I

F

GoEz=

F

oEz=

E

EoEz:

H

oEz=

tsoEz=

itd

o

E2g6A;aceE

t

Eo

Dc

Io

3o

EooI

ts

E

z=Iz5

;l2

E

HI

s-Eo

EzaEEzBIzItsB

E

EI2;oGI

h-FlIosUz6IzBoco-

3

E

EUdE2I

=ao

F

]os

Ez

FE

zd

D*F

o

3

I=I,t

!

o23

e

I-z

F

I

z4cz

a6

o

z

g

oF

Eoots

IF

aUzc6

:cE

F

!

E

Eo!

i

.Eu,tJ

!a.,

I.E.,

.!

,

tFo

I€c6

.!a.,

c o o o o

oe.E

oo.

U

oCoE<jl!4og15itE!!a!a;

38es.3=EEJI:9EE_3d-dEd8coooocnEO

EEgbitEEE€1FtiP5-PEo!!ggIE

EEtxSa>EdQtEf9gi

d -E

IEE

i!

Eei;Eb.

3se=-acAo,

o!B.EE*iE-r5i!t-Pi,EtigbfoiE!

dE8r-eas6E;

s9Eo

gBEB?EEI; Eg;iHie

tEoPo

!

tc.9

E

*oIe,te€e

E-=oo

g't

3Ef

=IEoj)=zlIE

te!

:o

E

eo

!

i

o

!gJaFE

€

E

f,,o

To

8

E,o

,Eo

cEaE

tofr€Ui-EEt:Eggr

EXil7E!.+t6eEs€;;=;-.2EcaE5 giE b

f f; :'qE t=: oot CEf tE'!€ cA.EEv- E fFg!5g:: rEEiEri!ti*iE.sE;:. E OEy6;sa E: o

c oG 5 oc -'uq!5€EbE3:E t'dEiEEf< >o ! -a e os !E --= aD

3E;EIs8-e€r-!igY!iebifP!EE-.I5 E?I EtiEBi=-EiTP.'EffifIE:;E€El+i;IaEt;!T*B

af .e:iisr6€EE

,I!

E8.it

teEo?E9€E

AE9.l

ai #ll I c

El E s!l copl5 EEl8-P>lced.9 -!td EggE!lo:=J? 3

8=:

5

H

-o9c5rBciSfsxxe<3=rts€ o=6q i

ExpzaBEsIo-.lr

AEE.I E

E=E

:=:bol8z E$d c! >4i;8i-t oEeE5Eto=I_i-griEE<NE

9gEjs o3FF

ootrl r

EEf "u€t€gE gE

Bs9za.(J(,)

(D

G)cI

?6.

Etro

6Lioo

EDE

=!

oooo!oc

'ooEot

rO

oooEgoEooco(,_cE6ocio

E.E,E6

(,

f!Er=o

!

GitEooo

otrooItoUIo

ooo

!

l!

oiFU'ooCD

€sEfio9ES=rI'E_cCLO

r=Eo>c-BgErIoE8€eE9tegL

=o=e#EEE9o5i()E

6oEo

oEo

eGIc\tFl

=,=

LrJzoz

E =l€>6 X

EEFo=9o(J!

EoE

EE!o<f,d6oE},9.

,oN

EN

Jo-93E.9

f;.E

!stinr/)PE<oEro Eido

sEE695gE

SER695

HE

sEP6?5*Ei6

E(,Elrl o

E E! ,bEEg

gEEg;

(o

oNgf

-oo o-o96CEXbEEOo.t! iohiloEi-gEc EEB.;E=E=o

it)!

TL

IEltEoIL

oD

aD

.t)fo:)T'gC'E6.lFr{P-SNElll e'J--i

&g 6oaE.r< >

=ts3

of

@

Pl-Ets,n'BP&EoE-!>

=_9

:-EEEFtar it5E=No66E

dooi56anoEg

16 EtoilE5.EClz ?,)

EocoooEu*lx-oaEref;cobxcotFf

!,j

:FEooOErul-qoxPobY6aE=o:xoocFA

s65xE'aulEo0,t)Eot1>rL_58

U'l

xXoF9s-oE9oaXa-eE<o

o=xF-do!ls)

Ae,UIEN(,,

EoI6o(,6o6-(E:R+(o6grP

Io-Jje

Ea8 it,ETf-" E -"5-.HE EsEHE

IE. : g>J;6q E-- E UJj og g E

sE FEsfcHs

o5Potr

IJJ

oC'Eo(EaF>oGO

ocoz

sCDg?N

co

€EEgeSP€qU)Y,J

o

o!O@itr, -.D6i=PoC)cD !acl-\o<

oJg'dJFL-gE

€_p €*SE EEOI OJ-o:< 6vEO ^EOo< <n<

o--

! LE..-9-go @9Vo-o-E-o .(l-{.rrJ-dlr',Eq EE--EEEUJoJ ort o o lE o=

t;iPEiEE,EHE BiEg=HE

oFJ-iocn-oE,r-otEo9E,Bi

z

oE.E!2roEE(EEEo.U,

6.6@

troEo@

saJ

*XOF€ -e--ok9o<x--eE< cl,

- 8* IEEE.E *o 9=:.tr_ E >=;5;E E E E i E

EE;.EEEE$Eo o; E= = E E=: eE E

=; ss ig O c r tD-? O g 6J u eo l!=(, cL5

gt

EEEEgg5.;f aO9-Eso.>==Oos9

r-L

eE=!l.r oEt: e= rE:EE9Eo->=o

.ot

EE sEeEEEE8EE;ir€iE 5 g€

otscPro E 9^==

E E6= G O6 Q EEG€ o-EoriPPEEe€ce

IEEEa;t E

EEEEL6- E

:E H-li -0Ef;E aI+o.I EE d qpEC'EOo.o5=

eLoio=

EdE(J-<goEoOoE},g

!c,

t!C,t

eGIcQr{

==

EI

€FCIG.

EsL

iotF EE Ea

E ; $".E d9c,8 s EE

66urEE=o

Eooll.

6oEEE{Eo

EoaoG

6!,eoJeoEE1o5 8,eg8B

6troElnocIoeostJCtFJtt) 2

Io2

2

ocozoEoz

ocoz

zz

2

eeoo;*(Dq

Iooc.,i

s(\la@

2

c,e.Ja!to

8d Egoo-iiooEP€#EE

E .,E PEe H E g

g ;'g EH g =u" g E

Ef E EE=E fif EE EEE=

ooofiE€-- tEO-€.E 6E,E 6tEd2

.€' E

EE Ei EE-e=- &€"= txFE EE;--EEEE: EEE.Effi

HseE=

c(E

oE

ETI.,EJOEE!>6ourE

EEOEE.E- Cn

EE;EBEgE

ECJ6!o

EoEoP:o- .:g

sE>o

=.EaEEdlE00

osE

E E#x(l6gE oo-o!o

oa)EoCLtr9.

EE fEHE

ofx

5$PC)6b9Eoooo

>QOJ€x-6 r-_

EE

of

=E,EE@eETEEaD6

zs2

oE=Sx]D t;

SEooI>

=-9

GG,I

$-rts:t?

sz.

r.B

ffiE

*'.2

E$ax-1, Fe€'ctlg

EE

}{AR 8 201?

ITNUrcN

suNDowht BANKSHARES, INC.

Financial Statements

December 31,2016 and 2015

ELC COUNTANTS

621 West 7th Street Plainview, TX79O72 2405z9th Street Lubbock, TX79411

To the Board of Directors

Sundown Bankshares, lncLevelland, Texas

Management is responsible for the accompanying financial statements of Sundown Bankshares, Inc. (parent

company only) and Sundown Bankshares,Inc. (consolidated), which comprise the balance sheets as of December

31,2016 and2015, and the related statements of income and changes in stockholders' equity for the years then

ended in accordance with accounting principles generally accepted in the United States of America. We have

performed a compilation engagement in accordance with Statements on Standards for Accounting and Review

Services promulgated by the Accounting and Review Services Committee of the AICPA. We did not audit or

review the financial statements nor were we required to perform any procedures to veriff the accuracy or

completeness of the information provided by management. Accordingly, we do not expness an opinion, aconclusion, nor provide any form ofassurance on these financial statements.

Management has elected to omit substantially all the disclosures and the statement of cash flows required by

accounting principles generally accepted in the United States of America. [f the omitted disclosures and statement

of cash flows were included in the financial statements, they might influence the user's conclusions about the

Company's financial position, results of operations, and cash flows. Accordingly, the financial statements are not

designed for those who are not informed about such matters.

Moseley & Riddle

Lubbock, Texas

January 6,2017

Phone: 806.293.3681 Fax: 806.293.3338 Phone: 806.281.9245 Fax: 806.293.3338

1 ,\ .i', ,I

MAR -s ZOr

CPAMember: American lnstitute of Certified Public Accountants

America Counls on CPAS

Member: Texas Society of Certified Public Accountants

SUNDOWN BANKSHAR"ES, INC.(PARENT COMPANY ONLY)

BALANCE SHEETS

DECEMBER 31,2016 AND 2015

ASSETS

Cash

Other Assets

Investment in unconsol idated subsidiary

Excess cost over equity in subsidiary less

accumulated amortization

TOT,AL ASSETS

LIABILITIES AND STOCKHOLDERS' f,QUITYAccrued expenses

TOTAL LIAB]LITIES

STOCKHOLDERS' EQUITYCommon stock, $10 par value; 200,000 shares authorized

120,140 and I 19,840 issued and outstanding, respectively

Additional paid-in capital

Retained earnings

Accumulated other comprehensive income

TOTAL STOCKHOLDERS' EQUITY

TOTAL LIABILMIES ANDSTOCKHOLDERS' EQUITY

2016 2015

$ t,097,616 $ 1,096,958

15,221,781 14,760,042

88,700 88,700

$ 16,408,103 $ 15,945,700

$

16,408,103 15,945,700

$ 16,408,103 $ 15,945,700

$

MAR -3 2017

NIC UNIT

See accountants' compi lation report

SUNDOWN BANKSHARES, INC.(PARENT COMPANY ONLI)STATEMENTS OF INCOME

FOR THE YEARS ENDED DECEMBER 31, 2016 AND

REVENUEEquity in earnings of unconsolidated subsidiary

TOTAL REVENUE

OPERATING EXPENSES

Other expenses

TOTAL OPERATING EXPENSES

INCOME BEFORE FEDERAL INCOME TAXBENEFIT (EXPENSE)

2016 2015

$ r,476,334 $ 1,808,139

r,476,334 r,830,868

1,476,334 r,808,139

1,476,334 I,808, I 39

6,328 3,009

$ 1,482,662 $ l,8l1,148

FEDERAL INCOME TAXES

NET INCOME

OTHER COMPREHENSIVE TNCOME, NET OF TAXChange in unrealized gain (loss) on securities

TOTAL COMPREHENSIVE INCOME

Dlt,lAR -3 2017

NIC UNIT

See accountants' compilation report

}.lAR - 3 2017 D

NIC UNIT

O

€

€qNo-€

N

r+r

N\Nr*

oaaNO

6a_! >

-tll]o

€

t-D

r:f I?R

.t azY-J<=aoefzgFEIS*;zl-dd<04v*7a

ZE;Etri9;Uz-Y. l>Zi-63i:z;*2d -7'2

21rI],_l

tI]FFU)

IT

t

tttT

T

Nm^6

oOo.

-q .)

96F

BEdE';Eilu)

.=.9 qEOU

r

od

o

ao

C

Cd

xFl'lz.9IZfrtZZ

2A-ae

a gE=HY; f I;=-i! =z=n2E ===E==Z, E

=et f H -

= 6

=Zt fi E

n E 4ZAii ?, E 3=ZA! i F>, 2 I i38 5 2 2 F i i3P 6 >siei 35i=ei 35llzc.Zoezaq.Z6rO

sso-90€o=" -- h_ -).-€€6rFN-6toa-

aqoc

'5soEo

tr

co

ooq

a6

OOO

$"

€

6r-ocI

s.IoOo

aaO

ASSETSCash and Cash Equivalents

Cash and due from banks

Total Cash and Cash Equivalents

lnvestment Securities

Available-for-saleHeld-to-maturity

Total Investment Securities

Loans, net of allowance for loan losses

Federal Home Loan Bank stockAccrued interest receivablePremises and equipment, net

Excess ofcost over equity in acquired companyOther assets

TOTAL ASSETS

LIABILITIES AND STOCKHOLDERS' EQUITYDeposits

Noninterest bearing

Savings and NOW deposits

Other time deposits

Total DepositsFed funds purchased

Interest payable and other liabilitiesTOTAL LIABILITIES

STOCKHOLDERS' EQUITYCommon stock, $10 parvalue; 200,000 shares authorized

120,140 and 1 I 9,840 issued and outstanding, respectivelyAdditional paid-in capitalRetained eamingsAccumulated other comprehensive income

TOTAL STOCKHOLDERS' EQUITY

TOTAL LIABILITIES ANDSTOCKHOLDERS' EQUITY

SUNDOWN BANKSHARES, INC.CONSOLIDATED BALANCE SHEETS

DECEMBER 31,2016 AND 2015

l'{AR -3 201?

NIC UNIT

2016 2015

$ 22,813,t63 $ 21,912,20622,813,163 21,912,206

359,327

32,121,451351,487

43.261 ,8 l232.480,778 43,613,299

79 74,406 85,023,550

76,9002,077,t872,453,450

88,700

3,s69,993

76,9001,977,557

2,652,72388,700

544,5 l0

$ 142,934,s77 $ r 55,889,445

$ 52,352,23946,214,04327,311,421

$ 49,066,377

61,276,90428.922,100

125,877,703 139,265,381

648 771 678,364126,526 474 139,943,74s

r,201,4003,900,449

I |,295 ,57 I

10,683

103 t5 945 700

s 142,934,577 $ r 55,889,445

l, I 98,400

3,864,48t10,878,464

4,355

See accountants' compi lation report

SUNDOWN BANKSHARES, I NC.CONSOLIDATED STATEMENTS OF INCOMEYEARS ENDED DECEMBER 3I, 20I6 AND 20I5

2016 2015

INTEREST INCOMEInterest and fees on loansInterest on investment securitiesInterest on federal funds sold

TOTAL INTEREST INCOME

INTEREST EXPENSEInterest expense on depositsInterest expense on borrowrngs

TOTAL INTEREST EXPENSE

NET INTEREST INCOME

PROVISION FOR LOAN LOSSES

NET INTEREST INCOME AFTER PROVISIONFOR LOAN LOSSES

OTHER INCOMEDividend income

Service charges and fees

Other service charges and fees

Other income

TOTAL OTHER INCOME

OTHER EXPENSESSalaries and employee benefits

Occupancy expense

Other operating expenses

TOTAL OTHER EXPENSES

INCOME BEFORE INCOME TAXES

INCOME TAXES

NET INCOME

OTHER COMPRHENSTVE INCOME, NET OF TAXChange in unrealized gain (loss) on available for sale securities

TOTAL COMPREHENSIVE INCON{E

$ 4,240,0951,238,454

54,624

$ 4,362,3721,330,232

70,2145,533,1 73 5 762,818

404,47535

329,147

404,510 329,147

5,128,663

70,631

5,433,67 t

130,747

s,058,032 5,302,924

J 1J

872,34867,336

202,059I , 142,05 6

274

999,466

112,96995 997

1,208,706

2,699,805653,380

I,132,430

2,634,31s628,440

1,213,5574,485,615 4,476,3t2

2,035,3 l81,714,473

238 139 227 179

$ r,476,334 $ 1,808,139

6,238 3,009

$ r,482,s72 $ l,8l 1,148

D

DMAR -s 2017

NIC UNIT

See accountants' compilation report

},lAR - 3 201?

NIC UNITIJ

oq

b

F

q

FFoFJ

aIl.l

i=Y^

.,9.2zaeg=E2tiqi:(Jd6zeYS=z-2< lJ t)l0lr(Jzo=>6tXFa

<>z-a<4irda>rl

=.loU)zQ

I

t

IT

II

I

o

o€

o*o-o66-r6hoh€66srr-6$O6-

6Nor

r=!i

-69.1q

EE6trclu)

,EyoE G-q!LU

oa

ao

N

I

6O

I

r6N.

6

o

ri

Od

€6ri

?aa)ErAN L E r-,- A

x ; F liE x ;5 fr ; TIE E E

z = = z=H

= EEH ?:a;A EgE a !.t a: O tdo= C Oi ; 2 q e g.ca I ei 2 2 A i

=3H E 2; i E = i;, ; iaEZAiZda

z

Hr.^Ntaxi-J=laoL!rlts!aiPZSQ5-Llz<?-zrlI.1O'j

1a3i:etJz

xFEIzv(.)

zlaAFl.lz?32o(,

dr.2-F>2)z1;'irrO -a2dFl O r.1UULZz*l-=<E:dazq

$to-€-€6s. -^ h- rI€€-6rrr--sao-

oOO

o

O€r-I6

o

r

=

6ar6N

o€oo

N_

r^aN$r9s- €-

oONO

oooo€oEoo

c

EIo

oa