EXHIBIT 10.1

                          BREMER FINANCIAL CORPORATION

                1998 EXECUTIVE ANNUAL INCENTIVE COMPENSATION PLAN

                              Chief Credit Officer
                             Chief Financial Officer
                            Chief Information Officer
                            Human Resources Director
                               Operations Director

Contained herein is a detailed outline of the Executive Annual Incentive
Compensation Plan which has been designed for the Chief Credit Officer, Chief
Financial Officer, Chief Information Officer, Human Resources Director and
Operations Director.

A.       Purpose

         1)       To provide an annual incentive award to the Chief Credit
                  Officer, Chief Financial Officer, Chief Information Officer,
                  Human Resources Director, and Operations Director for the
                  achievement of Bremer Financial Corporation's goals and
                  objectives.

         2)       To focus attention on those activities which will positively
                  affect the Corporation's financial well-being.

B.       Eligibility

         1)       The Chief Credit Officer, Chief Financial Officer, Chief
                  Information Officer, Human Resources Director, and Operations
                  Director are the participants in this plan.

C.       Plan Year

         1)       The Executive Annual Incentive Compensation program will begin
                  on January 1 and will end on December 31.

D.       Payment of Award

         1)       At year end, formal reviews will be conducted by the
                  appropriate designated management to determine and measure
                  performance. Upon completion of the measurement of the
                  participants' goals and objectives, awards will be approved.

         2)       Award payments will be made in the first quarter, following
                  the end of defined incentive plan year.

E.       Potential Awards

         1)       The maximum potential award, stated as a percentage of base
                  salary, will be 30%.

F.       Performance Measures and Determination of Award

         1)       70% of the incentive award will be based upon Corporate RORE.
                  The following table will be utilized to determine the actual
                  percentage of salary to be granted. When performance falls
                  between the RORE percentages shown, interpolation will be
                  utilized to determine the actual percentage of salary to be
                  awarded.

                  Corporate RORE                               Percentage Award
                  --------------                               ----------------

                       Below 13.00                                    -0-

                       13.00                THRESHOLD                 7.00%

                       13.76                2/3 OF MAXIMUM           14.00%


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                       14.20                PLAN                     17.62%

                       14.61 and over       MAXIMUM                  21.00%

         2)       Work Plan Objectives

                  30% of the incentive award will be based on work plan
                  objectives. The work plan objectives should be submitted to
                  the President and CEO of Bremer Financial Corporation for
                  approval ("CEO"). The maximum percentage award for achieving
                  work plan objectives is 9%.

G.       Administration

         1)       The plan shall be subject to the approval of the Board of
                  Directors of Bremer Financial Corporation ("Board") which
                  shall have sole authority to establish the terms and
                  conditions under which the plan will be administered.

         2)       The Executive Incentive Compensation Plan and awards are not
                  transferable or assignable.

         3)       Awards may not be deferred.

H.       Administrative Procedures

         1)       Additions to Plan -- Eligible individuals will be added to the
                  plan at any time upon the approval of the Board. However, the
                  size of their awards will be prorated by the number of months
                  they were eligible to receive an award. An example would be:

                  - Employee "A" is added to plan in mid-year so s/he has six
                       (6) months of eligible service.
                  - Calculated incentive award is $15,000
                  - $15,000 X 6/12 = $7,500

         2)       Terminations -- If the eligible participant terminates during
                  the plan year, the incentive award will be handled as follows:

                  - Voluntary resignations -- no incentive award.
                  - Involuntary terminations for cause -- no incentive award.
                  - Involuntary termination without cause -- incentive award
                       prorated by number of months service during current
                       incentive plan year, based on approval by the CEO.
                  - Retirement/disability -- incentive award prorated by number
                       of months of service during current incentive plan year.

         3)       Change in Position -- If the eligible participant has a change
                  in position during a plan year, their incentive award will be
                  calculated under both plan award levels and prorated by the
                  months of service at each level.

         4)       Interpolation -- When actual performance falls between cells
                  on the appropriate element, the individual completing the
                  formula should interpolate to the actual percentage to be
                  awarded.

         5)       Performance -- If a participant's performance rating for the
                  plan year is less than fully competent and/or certain
                  performance goals are not met, the CEO has the authority to
                  reduce partially or totally the incentive payout that would
                  normally be due the participant.

         6)       Exceptions -- Upon occasion, there may be specific reasons for
                  exceptions to the incentive compensation program for events
                  beyond the control of the participant in the plan. The CEO has
                  the authority to determine and approve all such exceptions.

I.       Amendment and termination


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         1)       The Board may at any time amend the plan for the purposes of
                  satisfying the requirements of any changes in applicable laws
                  or for any purpose which may be permitted by law. The Board
                  may also terminate the plan at any time. No such amendment or
                  termination shall, however, adversely affect the rights of any
                  participant (without his/her prior consent) to any award
                  previously approved.


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                    CALCULATION OF EXECUTIVE INCENTIVE AWARD

                                 Plan Year 1998



------------------------------            ------------------
NAME                                             TITLE


                                                            Percentage of Salary
                                                               To Be Awarded
                                                               -------------
F-1 - Corporate RORE
--------------------

         Corporate RORE
          (70% of total award)                   ______%       ______________%

         Work Plan Objectives Achievement Level  ______        ______________%
         (30% of total award)

         Attach a description of work plan objectives and
         how they will be measured.



Total Award Earned as % of Salary                              ______________%
---------------------------------

X 1998 Salary                                                  $______________

= 1998 INCENTIVE AWARD                                         $______________



Approved:


--------------------------     -------------------------------------------------
DATE                           President and CEO of Bremer Financial Corporation



--------------------------     -------------------------------------------------
DATE                           Chairman of Board of Bremer Financial Corporation


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