Annual Report


March 21, 2023


Pioneer Federal Mission Statement: Pioneer Federal Savings and Loan Association is dedicated to providing quality services and products to its customers all the while remaining financially strong and adding value to the quality of life to the communities it serves.  Pioneer Federal is known for commitment to our communities and our desire to help our communities grow and prosper.  We are Montana’s only mutual thrift institution our commitment is to you- our customers- and the communities we serve.   As a mutual, our customers are our owners, our success is measured by your success, we do not face the dilemma that commercial banks do of trying to balance shareholders’ demand for returns with serving customers’ interests.  Mutual banking is community banking at its finest, where we know our customers because you are our neighbors.

The calendar year 2022 brought upon the economy annual inflation rate upwards of 7%, with some months over 8% for year over year rate, and has had a tremendous impact on consumers, in response the Fed raised rates to landmark levels.  As members you should be proud as well as comfortable with the decisions made by your Association over the years which prepared us to survive the unsettled economic times we have endured the past few years as well as prosper going forward.  Locally, the increase in interest rates, combined with high prices, have made homes less affordable for consumers, real estate surrounding our two communities had a slowdown during 2022 as will be evident when you see our loan production numbers.

2022 saw Pioneer Federal Savings and Loan have another good growth year:

12.31.21-  Assets: $108,915,000           Deposits: $90,500,000            Loans: $77,780,000

12.31.22-  Assets: $103,385,000          Deposits: $85,450,000             Loans: $81,553,000


The deposit decreases mainly consisted of a decrease in Certificate of Deposits and IRAs.  The “core” Non-Maturing Deposits- Savings, Money Market, Checking and Business Checking accounts stayed at a somewhat flat level from 2021 to 2022.  The bulk of Pioneer’s deposits continue to be the non-Maturing deposits comprising $58,700,000 of the $85,450,000 on deposit; Certificates of Deposit make up $17,350,000 and IRAs $9,300,000.  Depositors at Pioneer Federal Savings and Loan earned almost $300,000 in interest in 2022.  At year end 2022 we had 5,500 deposit accounts across our variety of deposit products.


The Association new loans two-year comparison:

Association Loan
2022 2021
Assoc New Loans Total 108 Loans 157 Loans
New Loans Total Volume $20,470,000.00$23,800,000.00
Average Loan Size $189,520.00$151,600.00
Dillon Total Loans 66 Loans 80 Loans
Dillon Total Loan Volume $12,860,000.00$13,660,000.00
Dillon Average Loan Size $194,850.00$170,700.00
Deer Lodge Total Loans 42 Loans 77 Loans
Deer Lodge Total Loan Volume $7,608,500.00$10,140,000.00
Deer Lodge Average Loan Size $181,200.00$131,700.00


The 2022 new loans included:

67 Residential Real Estate Loans

33 Consumer Loans

8 Non-Residential RE Loans

 Commercial Loans

Pioneer Federal Savings and Loan Association’s capital position remains one of the strongest in MT.  Our capital level of $17,426,000 is 17.19% of assets and far exceeds the requirements of federal guidelines as of December 31, 2022. The Association’s strong capital levels will allow us to handle ongoing market uncertainties- specifically inflation and rising interest rates.

The Association’s cost of funds at year end was .48%.  Our number is higher than some of our competitors, as a mutual your Association continues to try to reward customers with very competitive deposit rates appropriate with the time, so we try to remain on the high end of scale regarding the interest paid to our depositors.  The cost of funds in 2023 will be a real challenge as consumers look to capture optimum interest rates on deposits in the rising rates environment.

Asset quality continues to remain high with very few loan delinquencies and an investment portfolio consisting of highly rated investments.  At year-end 2022, the Association had no Other Real Estate Owned (OREO) or foreclosed property on our books.

Pioneer Federal has been involved in quality loan participations with other MT financial institutions.  These participations make up approximately 5.5% of our total loan balances and allow the Association to diversify our loan portfolio.  Management continues to monitor the loan portfolio for weaknesses and the Association maintains a healthy provision for loan losses for any potential exposure we might have with respect to economic downturns or problem loans.

Pioneer Federal Savings and Loan Association and the Pioneer Federal Community Foundation, Inc. continue to financially support worthy projects and organizations located primarily in Powell and Beaverhead counties.  In addition to supporting many local area events and organizations, during 2022 we continued to fund previous financial commitments made supporting UM-Western, hospitals in both communities, and the Beaverhead County 4H Building construction project.   In the past 10 years alone, Pioneer Federal Savings and Loan and its Foundation have made cash contributions well over $1,000,000 within our local communities.

Personnel worked closely with bank regulators and independent auditors.  The Federal Deposit Insurance Corporation (FDIC), which became the Association’s primary federal regulator after the conversion to MT State Charter in December 2021, conducted the first full scope exam in the spring of 2022.  The Association received a favorable report with only a couple minor items to correct.  The FDIC also conducted a Compliance visitation at the end of the summer 2022 and the Association had an excellent review.  Our annual independent audit for year end 2022 was performed by Wipfli, as in years past the Association received a clean and unqualified audit.  The auditors commended favorably on our efforts in building and maintaining a strong financial structure.  The Association is very proud to have completed the first year as a MT Chartered bank!

Usage of the Association’s electronic banking package continues to grow as more customers take advantage of mobile banking, including e-statements, along with our phone app, the on-line services and debit cards.  The Association continues to provide financial education products for our customers on our website, as well as implementing online training to help prevent our customers avoid and/or recognize cyber hacking.  In 2022 the Association replaced current workstations (excluding the teller stations) with laptops and a docking station to allow employees to work remotely, if needed. The mobile and technology trend is something the Association needs to keep pace with our peers as this is the direction not only the banking industry is headed, but also where the world in general is moving.

The Dillon office again successfully hosted its annual community shred day.  This continues to be very successful and is expected to continue.

Our successes in the compliance and regulatory areas are made possible in no small part to Pioneer Federal’s commitment to strong compliance, audit and fiscal reporting programs coupled with an emphasis on continued staff, management, and Director training.  Pioneer Federal Savings and Loan continued to get the most from our capable staff of 19 FTEs.  Many years of service to Pioneer Federal are represented by our existing staff and Directors.

Pioneer Federal must remain true to the local communities in which we serve as well as we must work hard to retain and grow support of our local customer base.  Despite our successes we understand we cannot become complacent.  The way people bank and interact financially is changing more rapidly than ever before.  In this regard, we are committed to continuing to invest in our employees and the technology needed to meet our customers’ financial needs and expectations.  Also, we need to continue to expand our footprint into neighboring communities to allow us the opportunity for more growth.  Various factors including increased competition, both locally and from outside sources with the ability for customers to have their bank anywhere such as Fintech; inflation at historic levels has made it more difficult each year to operate as a community oriented, mutual thrift, so we must be flexible and adapt to changes for long term sustainability.  As a community financial institution, we are faced daily with operational, regulatory, economic risks and how we deal with these on an ongoing basis will define our continued success.

To our many customers, I would like to personally thank you for your relationship and your trust in Pioneer Federal- you are truly our most valued asset.  As members of Pioneer Federal Savings and Loan Association you should be very proud as we have a strong financial institution.  We have well trained and qualified staff who are also involved in many organizations and projects within our communities.

I would like to express sincere appreciation to our staff, the officers and our Board of Directors for their continued effort and support on behalf of the Association. Please let me know any questions you may have about Pioneer Federal Savings and Loan Association.


Phillip K Willett
March 21, 2023



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Each depositor insured to at least $250,000.