PROSPECTUS SUPPLEMENT SUMMARY
This summary highlights selected information contained elsewhere in, or incorporated by reference into, this prospectus supplement. Because this is a summary, it may not contain all of the information that is important to you in making your investment decision. You should carefully read this entire prospectus supplement and the accompanying prospectus, as well as the information to which we refer you and in the documents incorporated by reference herein and therein, before deciding whether to invest in the Notes. You should pay special attention to the information contained under the captions entitled “Risk Factors” in this prospectus supplement and the accompanying prospectus, in our Annual Report on Form 10-K for the fiscal year ended December 31, 2019, and our Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2020, and subsequent filings with the SEC to determine whether an investment in the Notes is appropriate for you.
Park National Corporation
Park National Corporation, or the Company, is a financial holding company subject to regulation under the Bank Holding Company Act of 1956, as amended. The Company was initially incorporated under Delaware law in 1986 and began operations as a bank holding company in 1987. In 1992, the Company changed its state of incorporation to Ohio. The Company’s principal executive offices are located at 50 North Third Street, Newark, Ohio 43055, and its telephone number is (740) 349-8451.
The Company’s principal business consists of owning and supervising its subsidiaries. Although the Company directs the overall policies of its subsidiaries, including lending policies and financial resources, most day-to-day affairs are managed by the respective officers of the Company’s subsidiaries.
Banking Operations
The Company’s banking operations are conducted through The Park National Bank, a national banking association. PNB engages in the commercial banking and trust business, generally in small and medium population Ohio, North Carolina and South Carolina communities in addition to operations within the metropolitan areas of Columbus and Cincinnati, Ohio, Charlotte, North Carolina, and Louisville, Kentucky. PNB operates 118 financial service offices, including 115 branches, in Ohio, Kentucky, North Carolina and South Carolina. PNB delivers financial products and services through its 118 financial service offices and a network of 137 automated teller machines, as well as telephone and internet-based banking through both personal computers and mobile devices.
At June 30, 2020, subsidiaries of the Company, including PNB and Scope Leasing, Inc., had approximately $3,398 million in commercial loans (commercial, financial and agricultural loans and commercial real estate loans) and commercial leases outstanding, representing approximately 47.2% of Park’s total aggregate loan portfolio as of that date. Of this amount, approximately $1,737 million represented commercial, financial and agricultural loans, $1,632 million represented commercial real estate loans, and $29 million represented commercial leases.
At June 30, 2020, subsidiaries of the Company, principally PNB, had outstanding approximately $2,300 million in construction real estate loans and residential real estate loans, representing approximately 31.9% of Park’s total aggregate loan portfolio as of that date. Of the $2,300 million, approximately $1,948 million was included within the residential real estate loan segment, which included $499 million of commercial loans secured by residential real estate, $1,234 million of mortgage loans, $204 million of home equity lines of credit and $11 million of installment loans. The remaining $352 million was included within the construction real estate loan segment, which included $245 million of commercial land and development loans, $106 million of 1-4 family residential construction loans, and $1 million of installment loans. The market area for real estate lending by PNB is concentrated in Ohio, Kentucky, North Carolina and South Carolina.
At June 30, 2020, the Company’s subsidiaries, principally PNB, had outstanding consumer loans (including automobile loans) in an aggregate amount of $1,506 million, constituting approximately 20.9% of Park’s total aggregate loan portfolio as of that date. The Company’s subsidiaries make installment credit available to customers and prospective customers in their primary market areas through direct and indirect loans. Indirect loans are facilitated through an automobile dealer, while direct loans are originated through direct customer interaction with the Company’s subsidiaries. At June 30, 2020, of the $1,506 million in consumer loans, $1,275 million were originated through indirect lending, while the remaining $231 million were considered direct loans. At June 30, 2020, of the $1,506 million in consumer loans, approximately 98.8% of these loans were held by PNB with the Company’s consumer finance subsidiary holding the balance.