HILLS BANCORPORATION

Hills Bancorporation is a holding company primarily engaged in banking through its subsidiary, Hills Bank and Trust Company. The Company was incorporated on December 12, 1982, and conducts all its operations within the state of Iowa. Hills Bancorporation became the sole owner of Hills Bank and Trust on January 23, 1984. The Company formed a new subsidiary, Hills Bank, on July 1, 1996, which acquired a bank in Lisbon, Iowa. Hills Bank merged into Hills Bank and Trust on November 17, 2000. On September 20, 1996, another subsidiary, Hills Bank Kalona, acquired assets and assumed deposits from the Kalona, Iowa office of Boatmen's Bank Iowa, N.A. Hills Bank Kalona merged into Hills Bank and Trust on October 26, 2001. There have been no further acquisitions since 2001. Hills Bank and Trust is a full-service commercial bank serving individuals, businesses, governmental units, and institutional customers. Its services include accepting demand, savings, and time deposits; making commercial, real estate, agricultural, and consumer loans; providing night and safe deposit facilities; and performing collection, exchange, and other banking services. The Bank also administers estates, personal trusts, and pension plans, and offers farm management, investment advisory, and custodial services for individuals, corporations, and nonprofit organizations. Additionally, the Bank earns fees from originating mortgages that are sold on the secondary residential real estate market without retaining mortgage servicing rights.