Statement from Bremer Financial Corporation (May 2, 2022)
Bremer Financial Corporation is grateful to the Ramsey County District Court for its careful attention to this important matter. We are hopeful that today’s decision will help restore the critical relationship between BFC and OBT, and the philanthropy that relationship enables, that has benefited our local communities for more than 75 years. Bremer remains focused on delivering outstanding results for our customers and the communities we serve.
Bremer Financial Corporation Board of Directors will not renominate Otto Bremer Trust Trustees for election to BFC Board
On February 22, 2021, Bremer Financial Corporation issued an announcement regarding the BFC Board’s vote not to renominate OBT trustees Brian Lipschultz and Daniel Reardon for election as board members at BFC’s 2021 annual meeting of shareholders, after determining they are unfit to serve as directors of BFC.
Bremer Financial Corporation’s response to Attorney General Ellison’s petition to remove trustees
On August 12, Bremer Financial Corporation issued the following statement in response to Attorney General Ellison’s petition to the court to remove the trustees of the Otto Bremer Trust:
Bremer Financial Corporation appreciates Attorney General Ellison’s thorough investigation into this matter. We are in complete support of the attorney general’s filing and believe these actions are necessary to fulfill Otto Bremer’s vision for the Trust. We look forward to working with the attorney general’s office as we move forward.
Bremer’s purpose of cultivating thriving communities has never been more important, and we remain committed to our customers, communities and employees today more than ever.
Background
Otto Bremer founded the Bremer Financial Corporation in 1943. BFC has been an independent financial services organization headquartered in Saint Paul ever since. With over $13 billion in assets and 1,800 employees, BFC provides a comprehensive range of banking, mortgage, investment, wealth management, trust and insurance products and services throughout Minnesota, North Dakota, and Wisconsin. When Otto Bremer saw that he could do more to grow the communities the bank serves, he founded the nonprofit Otto Bremer Trust to give back proceeds from the bank. Since 1989, BFC has served as a highly successful financial engine for OBT, paying more than $800 million in dividends to the Otto Bremer Trust to invest in the communities the bank serves.
Bremer is a regional bank that operates like a community bank: our independence and unique structure have fostered a strong connection with local communities. We distinguish ourselves with our unique focus on business and agricultural customers. Bremer Bank and our employees have a commitment to charitable giving and community involvement, including partnerships with Twin Cities Habitat for Humanity, Farm Rescue, United Way and Great Plains Food Bank. Bremer’s employees donate more than 32,000 volunteer hours annually serving their local communities. We are proud to have an “outstanding” Community Reinvestment Act rating from bank regulators, based on our borrower income distributions and innovative new products focused on providing affordable financing for low- and moderate-income people.
The Otto Bremer Trust recently announced a purported transfer of BFC voting stock to out-of-state hedge funds, with the stated goal of replacing the BFC Board and putting Bremer up for sale. The BFC Board has determined that a sale of BFC is not in the best interests of BFC’s employees, shareholders or the communities it serves, and BFC has filed a lawsuit to protect these constituencies and asserting the invalidity of these purported transfers.
BFC is proud of its legacy and committed to continuing to serve communities in Minnesota, North Dakota and Wisconsin.
[Information regarding the lawsuit and related matters is available on this webpage. Please check back for periodic updates.]
Additional Updates
Bremer Financial Corporation’s June 15, 2020 Statement
The trustees’ allegations are false and legally improper, and cannot change the pattern of self-interested transactions at issue in the lawsuit. It is abhorrent that the trustees now appear to be relying on the pandemic and the devastating loss of George Floyd’s life to support their baseless claims, and it is unfortunate that they continue to rely on intimidation to further their arguments. The trustees’ claims are inconsistent with the evidence in the lawsuit and will not withstand scrutiny. Bremer Bank was not for sale last October, and it is not for sale today.
Bremer was founded in 1943 and the trust was established the next year for the express purpose of ensuring that as long as the bank existed, the communities it served would benefit from its success. We are proud of that success and the impact Bremer Financial Corporation has had on our communities for more than 75 years through the trust’s charitable works. Since 1989, Bremer has distributed over $800 million to the trust, including over $80 million in 2019 alone.
Bremer’s financial results and market position remain strong. We remain focused on serving our customers and communities throughout the Upper Midwest through these extraordinary and challenging times, including making nearly $1.5 billion in Paycheck Protection Program loans to organizations throughout our footprint, helping to protect the paychecks of more than 170,000 people.
Former Bremer Executives Support BFC in Letter to the Editor
Recently, three former executives with over 130 cumulative years of service in Otto Bremer Banks wrote a letter to the editor for publication in the Duluth News Tribune supporting the continuation of Bremer. They believe the customers in Minnesota, North Dakota and Wisconsin are better served by the current structure. You can read the full letter to the editor here.
Attorney General Ellison’s office opens investigation into Otto Bremer Trust
We welcome the attorney general’s involvement and the opportunity to cooperate in the office’s investigation. We remain focused on serving our customers, employees and communities with the same heartfelt determination that Otto Bremer instilled in our company when he established it in 1943. You can read a press release from Attorney General Keith Ellison’s office here.
From the Star Tribune: Bremer’s profit rose 7% in 2019, and it gave $80M to the trust it’s fighting
From the Star Tribune, “Bremer Financial, parent company of Bremer Bank, said 2019 earnings rose 7% to $156 million. The St. Paul-based company, owned by a foundation and its employees, said dividend payout to shareholders rose nearly 15% to $87.6 million, including $80.6 million to the Otto Bremer Trust. ‘These results are a testament to our continued solid financial performance across our businesses,’ CEO Jeanne Crain said in a statement. ‘We’re looking forward to amplifying our work on the strategies and investments that made 2019 such a success, including our work on digital capabilities to better serve our customers.’” Read the full article here.
From American Banker: Bremer Bank says it’s not for sale. Its biggest investor begs to differ
“I think we’re on the right side of this,” Jeanne Crain, Bremer Financial’s CEO since 2016, said in an interview. “We’re protecting the independence of this organization as our founder intended. I don’t see anything in the industry to say that we should go away.” Read the full article here.
From the Star Tribune: What is Bremer Financial worth? Well, it’s complicated
The latest annual tax form called the 990 for the Otto Bremer Trust is now on the St. Paul foundation’s website, and very deep in the document is a curious update to its 2018 filing. In the 2018 tax return, the fair market value of the foundation’s 90% or so stake in Bremer Financial Corp. was stated at not quite $900 million. A year later the trust’s stake in Bremer had shot to a fair market value of $1.8 billion. One of those numbers had to be very wrong. Read the full article here.
