ARCHBOLD, Ohio, Feb. 12, 2025 (GLOBE NEWSWIRE) -- Farmers & Merchants Bancorp, Inc. (Nasdaq: FMAO) today reported financial results for the 2024 fourth quarter and twelve months ended December 31, 2024.
2024 Fourth Quarter Financial and Operating Highlights (on a year-over-year basis unless noted):
- 87 consecutive quarters of profitability
- Net income increased 51.2% to $8.4 million, or $0.61 per basic and diluted share, from $5.5 million, or $0.41 per basic and diluted share
- Asset quality remains at historically strong levels with nonperforming loans of only $3.1 million at December 31, 2024, compared to $22.4 million at December 31, 2023
- Net charge-offs to average loans were 0.00%
- Allowance for credit losses was 826.70% of nonperforming loans
- Tier 1 leverage ratio was 8.12%
- Net interest margin increased 27 basis points to 2.84%
- Efficiency ratio improved to 59.82%, compared to 69.23% for the same period a year ago
2024 Full-Year Financial Highlights Include (on a year-over-year basis unless noted):
- Total loans, net were $2.56 billion at December 31, 2024, compared to $2.58 billion at December 31, 2023 and $2.54 billion at September 30, 2024
- Total assets increased 2.5% to $3.36 billion
- Deposits increased 3.0% to a record $2.69 billion
- Stockholders' equity increased 5.9% to $335.2 million
- Net interest income after provision for credit losses increased 7.5% to $85.6 million
- Return on average tangible equity was 8.91%
- F&M ended 2024 with excellent liquidity levels, and over $690 million in contingent funding sources, and a cash-to-assets ratio of 5.3%, compared to 4.3% at December 31, 2023
- Dividend raised 3.8% year-over-year, representing the 30th consecutive annual increase in the Company's regular dividend payment since 1994
Lars B. Eller, President and Chief Executive Officer, stated, "Our strong 2024 financial performance reflects solid execution of our multi-year strategic plan, as we have remained focused on continual improvements, managing the items under our control, and providing our customers and communities with outstanding, and local financial services. Thanks to the unwavering dedication of our team and the trust of our customers, F&M's financial and operating results strengthened throughout 2024. This performance creates a solid foundation and further solidifies F&M's position as a leading community bank in the Ohio, Indiana and Michigan markets we serve."
Mr. Eller continued, "Strong earnings growth in 2024 was driven by the success of ongoing strategies aimed at expanding our net interest margin, maintaining excellent asset quality, and driving efficiencies across our business. Core earnings for the 2024 fourth quarter were strong as net interest income after provision for credit losses increased 16.1% year-over-year to a quarterly record of $22.6 million, and noninterest income expanded 4.1% year-over-year to $4.0 million. We believe these trends highlight the improvements we have made to profitability, and we expect these trends to continue in the second half 2025."
Income Statement
Net income for the 2024 fourth quarter ended December 31, 2024, was $8.4 million, compared to $5.5 million for the same period last year. Net income per basic and diluted share for the 2024 fourth quarter was $0.61, compared to $0.41 for the same period last year. Net income for the 2024 twelve months ended December 31, 2024, was $25.9 million, compared to $22.8 million for the same period last year. Net income per basic and diluted share for the 2024 twelve months was $1.90, compared to $1.67 for the same period last year.
Deposits
At December 31, 2024, total deposits were a record $2.69 billion, an increase of 3.0% from December 31, 2023. The Company's cost of interest-bearing liabilities was 3.01% for the quarter ended December 31, 2024, compared to 3.02% for the quarter ended December 31, 2023. For the 2024 twelve months ended December 31, 2024, F&M's cost of interest-bearing liabilities was 3.12%, compared to 2.53% in the prior year reflecting the higher rate environment and growth in interest-bearing checking and savings accounts.
Mr. Eller commented, "Throughout 2024, we pursued strategies aimed at optimizing our deposit base and growing low-cost checking (DDA) deposits. Since the beginning of 2024, we added nearly 7,500 new checking accounts, and benefited from new and expanded relationships at offices that were opened in 2023. As a result, we ended 2024 with a loan-to-deposit ratio of 94.4%, compared to 98.0% at December 31, 2023."
Loan Portfolio and Asset Quality
"While the demand for loans is high across our markets, our approach to risk and pricing remains prudent. This strategy has contributed to historically strong asset quality over the past two quarters and is a testament to F&M's risk, lending, and compliance capabilities and high-performing teams. We expect loan growth to increase modestly in 2025, with growth weighted in the back half of the year. In addition, 31.4% of our loan portfolio is subject to reprice in the next 12 months. We believe these favorable trends will contribute to higher net interest income in 2025," continued Mr. Eller.
Total loans, net at December 31, 2024, decreased 0.7%, or by $19.3 million to $2.56 billion, compared to $2.58 billion at December 31, 2023. The year-over-year decline was driven primarily by lower consumer real estate, consumer, and agricultural real estate loans, partially offset primarily by higher commercial and industrial and agricultural loans. Compared to the quarter ended September 30, 2024, total loans, net at December 31, 2024 increased by 0.9% or $23.5 million.
F&M continues to closely monitor its loan portfolio with a particular emphasis on higher risk sectors. Nonperforming loans were $3.1 million, or 0.12% of total loans at December 31, 2024, compared to $22.4 million, or 0.87% of total loans at December 31, 2023, and $2.9 million, or 0.11% at September 30, 2024.
F&M maintains a well-balanced, diverse and high performing CRE portfolio. CRE loans represented 51.2% of the Company's total loan portfolio at December 31, 2024. In addition, F&M's commercial real estate office credit exposure represented 5.2% of the Company's total loan portfolio at December 31, 2024, with a weighted average loan-to-value of approximately 64% and an average loan of approximately $958,100.
F&M's CRE portfolio included the following categories at December 31, 2024:
CRE Category | Dollar Balance | Percent of CRE Portfolio(*) | Percent of Total Loan Portfolio(*) | ||||
| Industrial | $ | 269,315 | 20.6% | 10.5% | |||
| Multi-family | 233,868 | 17.8% | 9.1% | ||||
| Retail | 219,395 | 16.7% | 8.6% | ||||
| Hotels | 141,514 | 10.8% | 5.5% | ||||
| Office | 134,139 | 10.2% | 5.2% | ||||
| Gas Stations | 70,767 | 5.4% | 2.8% | ||||
| Food Service | 49,246 | 3.8% | 1.9% | ||||
| Senior Living | 31,799 | 2.4% | 1.3% | ||||
| Development | 29,491 | 2.3% | 1.2% | ||||
| Auto Dealers | 28,081 | 2.1% | 1.1% | ||||
| Other | 103,196 | 7.9% | 4.0% | ||||
| Total CRE | $ | 1,310,811 | 100.0% | 51.2% | |||
* Numbers have been rounded
At December 31, 2024, the Company's allowance for credit losses to nonperforming loans was 826.70%, compared to 111.95% at December 31, 2023. The allowance to total loans was 1.07% at December 31, 2024, compared to 1.06% at December 31, 2023. Including accretable yield adjustments, associated with the Company's prior acquisitions, F&M's allowance for credit losses to total loans was 1.08% at December 31, 2024, compared to 1.13% at December 31, 2023.
Mr. Eller concluded, "Throughout the new year, we will leverage F&M's strong banking platform, while continuing to make strategic investments that expanded our operations, capabilities, and services. We believe this will expand operating efficiencies and produce better outcomes for our customers. I am proud of our strong performance in 2024, and expect 2025 to be another good year for F&M."
Stockholders' Equity and Dividends
Total stockholders' equity increased 5.9% to $335.2 million, or $24.47 per share at December 31, 2024, from $316.5 million, or $23.17 per share at December 31, 2023. The Company's Tier 1 leverage ratio of 8.12%, remained stable compared to December 31, 2023.
Tangible stockholders' equity increased to $270.0 million at December 31, 2024, compared to $254.2 million at December 31, 2023. On a per share basis, tangible stockholders' equity at December 31, 2024, was $17.74 per share, compared to $16.29 per share at December 31, 2023.
For the twelve months ended December 31, 2024, the Company declared cash dividends of $0.8825 per share, representing a 3.8% increase over the same period last year. F&M is committed to returning capital to shareholders and has increased the annual cash dividend for 30 consecutive years. For the twelve months ended December 31, 2024, the dividend payout ratio was 46.07% compared to 50.65% for the same period last year.
About Farmers & Merchants State Bank:
F&M Bank is a local independent community bank that has been serving its communities since 1897. F&M Bank provides commercial banking, retail banking and other financial services. Our locations are in Butler, Champaign, Fulton, Defiance, Hancock, Henry, Lucas, Shelby, Williams, and Wood counties in Ohio. In Northeast Indiana, we have offices located in Adams, Allen, DeKalb, Jay, Steuben and Wells counties. The Michigan footprint includes Oakland County, and we have Loan Production Offices in Troy, Michigan; Muncie, Indiana; and Perrysburg and Bryan, Ohio.
Safe Harbor Statement
Farmers & Merchants Bancorp, Inc. ("F&M") wishes to take advantage of the Safe Harbor provisions included in the Private Securities Litigation Reform Act of 1995. Statements by F&M, including management's expectations and comments, may not be based on historical facts and are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21B of the Securities Exchange Act of 1934, as amended. Actual results could vary materially depending on risks and uncertainties inherent in general and local banking conditions, competitive factors specific to markets in which F&M and its subsidiaries operate, future interest rate levels, legislative and regulatory decisions, capital market conditions, or the effects of the COVID-19 pandemic, and its impacts on our credit quality and business operations, as well as its impact on general economic and financial market conditions. F&M assumes no responsibility to update this information. For more details, please refer to F&M's SEC filing, including its most recent Annual Report on Form 10-K and quarterly reports on Form 10-Q. Such filings can be viewed at the SEC's website, www.sec.gov or through F&M's website www.fm.bank.
Non-GAAP Financial Measures
This press release includes disclosure of financial measures not prepared in accordance with generally accepted accounting principles in the United States (GAAP). A non-GAAP financial measure is a numerical measure of historical or future financial performance, financial position or cash flows that excludes or includes amounts that are required to be disclosed by GAAP. Farmers & Merchants Bancorp, Inc. believes that these non-GAAP financial measures provide both management and investors a more complete understanding of the underlying operational results and trends and Farmers & Merchants Bancorp, Inc.'s marketplace performance. The presentation of this additional information is not meant to be considered in isolation or as a substitute for the numbers prepared in accordance with GAAP. A reconciliation of GAAP to non-GAAP financial measures is included within this press release.
| FARMERS & MERCHANTS BANCORP, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME & COMPREHENSIVE INCOME (Unaudited) (in thousands of dollars, except per share data) | |||||||||||||||||||||||||||
| Three Months Ended | Twelve Months Ended | ||||||||||||||||||||||||||
| December 31, 2024 | September 30, 2024 | June 30, 2024 | March 31, 2024 | December 31, 2023 | December 31, 2024 | December 31, 2023 | |||||||||||||||||||||
| Interest Income | |||||||||||||||||||||||||||
| Loans, including fees | $ | 36,663 | $ | 36,873 | $ | 36,593 | $ | 35,200 | $ | 34,493 | $ | 145,329 | $ | 129,344 | |||||||||||||
| Debt securities: | |||||||||||||||||||||||||||
| U.S. Treasury and government agencies | 1,882 | 1,467 | 1,148 | 1,045 | 987 | 5,542 | 4,090 | ||||||||||||||||||||
| Municipalities | 384 | 387 | 389 | 394 | 397 | 1,554 | 1,598 | ||||||||||||||||||||
| Dividends | 367 | 334 | 327 | 333 | 365 | 1,361 | 882 | ||||||||||||||||||||
| Federal funds sold | 24 | 7 | 7 | 7 | 8 | 45 | 44 | ||||||||||||||||||||
| Other | 2,531 | 2,833 | 2,702 | 1,675 | 2,020 | 9,741 | 3,850 | ||||||||||||||||||||
| Total interest income | 41,851 | 41,901 | 41,166 | 38,654 | 38,270 | 163,572 | 139,808 | ||||||||||||||||||||
| Interest Expense | |||||||||||||||||||||||||||
| Deposits | 15,749 | 16,947 | 16,488 | 15,279 | 15,015 | 64,463 | 46,923 | ||||||||||||||||||||
| Federal funds purchased and securities sold under agreements to repurchase | 274 | 277 | 276 | 284 | 293 | 1,111 | 1,474 | ||||||||||||||||||||
| Borrowed funds | 2,713 | 2,804 | 2,742 | 2,689 | 2,742 | 10,948 | 8,876 | ||||||||||||||||||||
| Subordinated notes | 285 | 284 | 285 | 284 | 285 | 1,138 | 1,138 | ||||||||||||||||||||
| Total interest expense | 19,021 | 20,312 | 19,791 | 18,536 | 18,335 | 77,660 | 58,411 | ||||||||||||||||||||
| Net Interest Income - Before Provision for Credit Losses | 22,830 | 21,589 | 21,375 | 20,118 | 19,935 | 85,912 | 81,397 | ||||||||||||||||||||
| Provision for (Recovery of) Credit Losses - Loans | 346 | 282 | 605 | (289 | ) | 278 | 944 | 1,698 | |||||||||||||||||||
| Provision for (Recovery of) Credit Losses - Off Balance Sheet Credit Exposures | (120 | ) | (267 | ) | (18 | ) | (266 | ) | 189 | (671 | ) | 46 | |||||||||||||||
| Net Interest Income After Provision for Credit Losses | 22,604 | 21,574 | 20,788 | 20,673 | 19,468 | 85,639 | 79,653 | ||||||||||||||||||||
| Noninterest Income | |||||||||||||||||||||||||||
| Customer service fees | 237 | 300 | 189 | 598 | 415 | 1,324 | 1,332 | ||||||||||||||||||||
| Other service charges and fees | 1,176 | 1,155 | 1,085 | 1,057 | 1,090 | 4,473 | 4,343 | ||||||||||||||||||||
| Interchange income | 1,322 | 1,315 | 1,330 | 1,429 | 1,310 | 5,396 | 5,318 | ||||||||||||||||||||
| Loan servicing income | 771 | 710 | 513 | 539 | 666 | 2,533 | 4,405 | ||||||||||||||||||||
| Net gain on sale of loans | 223 | 215 | 314 | 107 | 230 | 859 | 699 | ||||||||||||||||||||
| Increase in cash surrender value of bank owned life insurance | 248 | 265 | 236 | 216 | 216 | 965 | 834 | ||||||||||||||||||||
| Net gain (loss) on sale of other assets owned | 22 | - | 49 | - | (86 | ) | 71 | (135 | ) | ||||||||||||||||||
| Net loss on sale of available-for-sale securities | - | - | - | - | - | - | (891 | ) | |||||||||||||||||||
| Total noninterest income | 3,999 | 3,960 | 3,716 | 3,946 | 3,841 | 15,621 | 15,905 | ||||||||||||||||||||
| Noninterest Expense | |||||||||||||||||||||||||||
| Salaries and wages | 7,020 | 7,713 | 7,589 | 7,846 | 6,981 | 30,168 | 26,915 | ||||||||||||||||||||
| Employee benefits | 2,148 | 2,112 | 2,112 | 2,171 | 1,218 | 8,543 | 7,520 | ||||||||||||||||||||
| Net occupancy expense | 1,072 | 1,054 | 999 | 1,027 | 1,187 | 4,152 | 3,833 | ||||||||||||||||||||
| Furniture and equipment | 1,032 | 1,472 | 1,407 | 1,353 | 1,370 | 5,264 | 5,022 | ||||||||||||||||||||
| Data processing | 160 | 339 | 448 | 500 | 785 | 1,447 | 3,147 | ||||||||||||||||||||
| Franchise taxes | 312 | 410 | 265 | 555 | 308 | 1,542 | 1,487 | ||||||||||||||||||||
| ATM expense | 328 | 472 | 397 | 473 | 665 | 1,670 | 2,611 | ||||||||||||||||||||
| Advertising | 498 | 597 | 519 | 530 | 397 | 2,144 | 2,606 | ||||||||||||||||||||
| FDIC assessment | 505 | 516 | 507 | 580 | 594 | 2,108 | 1,982 | ||||||||||||||||||||
| Servicing rights amortization - net | 244 | 219 | 187 | 168 | 182 | 818 | 611 | ||||||||||||||||||||
| Loan expense | 236 | 244 | 251 | 229 | 246 | 960 | 1,055 | ||||||||||||||||||||
| Consulting fees | 242 | 251 | 198 | 186 | 192 | 877 | 832 | ||||||||||||||||||||
| Professional fees | 368 | 453 | 527 | 445 | 331 | 1,793 | 1,430 | ||||||||||||||||||||
| Intangible asset amortization | 446 | 445 | 444 | 445 | 446 | 1,780 | 1,780 | ||||||||||||||||||||
| Other general and administrative | 1,465 | 1,128 | 1,495 | 1,333 | 1,532 | 5,421 | 6,373 | ||||||||||||||||||||
| Total noninterest expense | 16,076 | 17,425 | 17,345 | 17,841 | 16,434 | 68,687 | 67,204 | ||||||||||||||||||||
| Income Before Income Taxes | 10,527 | 8,109 | 7,159 | 6,778 | 6,875 | 32,573 | 28,354 | ||||||||||||||||||||
| Income Taxes | 2,146 | 1,593 | 1,477 | 1,419 | 1,332 | 6,635 | 5,567 | ||||||||||||||||||||
| Net Income | 8,381 | 6,516 | 5,682 | 5,359 | 5,543 | 25,938 | 22,787 | ||||||||||||||||||||
| Other Comprehensive Income (Loss) (Net of Tax): | |||||||||||||||||||||||||||
| Net unrealized gain (loss) on available-for-sale securities | (7,403 | ) | 11,664 | 2,531 | (1,995 | ) | 13,261 | 4,797 | 10,781 | ||||||||||||||||||
| Reclassification adjustment for realized loss on sale of available-for-sale securities | - | - | - | - | - | - | 891 | ||||||||||||||||||||
| Net unrealized gain (loss) on available-for-sale securities | (7,403 | ) | 11,664 | 2,531 | (1,995 | ) | 13,261 | 4,797 | 11,672 | ||||||||||||||||||
| Tax expense (benefit) | (1,554 | ) | 2,449 | 531 | (418 | ) | 2,784 | 1,008 | 2,451 | ||||||||||||||||||
| Other comprehensive income (loss) | (5,849 | ) | 9,215 | 2,000 | (1,577 | ) | 10,477 | 3,789 | 9,221 | ||||||||||||||||||
| Comprehensive Income | $ | 2,532 | $ | 15,731 | $ | 7,682 | $ | 3,782 | $ | 16,020 | $ | 29,727 | $ | 32,008 | |||||||||||||
| Basic Earnings Per Share | $ | 0.61 | $ | 0.48 | $ | 0.42 | $ | 0.39 | $ | 0.41 | $ | 1.90 | $ | 1.67 | |||||||||||||
| Diluted Earnings Per Share | $ | 0.61 | $ | 0.48 | $ | 0.42 | $ | 0.39 | $ | 0.41 | $ | 1.90 | $ | 1.67 | |||||||||||||
| Dividends Declared | $ | 0.22125 | $ | 0.22125 | $ | 0.22 | $ | 0.22 | $ | 0.22 | $ | 0.88250 | $ | 0.85 | |||||||||||||
| FARMERS & MERCHANTS BANCORP, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (in thousands of dollars, except per share data) | |||||||||||||||||||
| December 31, 2024 | September 30, 2024 | June 30, 2024 | March 31, 2024 | December 31, 2023 | |||||||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | |||||||||||||||||
| Assets | |||||||||||||||||||
| Cash and due from banks | $ | 174,855 | $ | 244,572 | $ | 191,785 | $ | 186,541 | $ | 140,917 | |||||||||
| Federal funds sold | 1,496 | 932 | 1,283 | 1,241 | 1,284 | ||||||||||||||
| Total cash and cash equivalents | 176,351 | 245,504 | 193,068 | 187,782 | 142,201 | ||||||||||||||
| Interest-bearing time deposits | 2,482 | 2,727 | 3,221 | 2,735 | 2,740 | ||||||||||||||
| Securities - available-for-sale | 426,556 | 404,881 | 365,209 | 347,516 | 358,478 | ||||||||||||||
| Other securities, at cost | 14,400 | 15,028 | 14,721 | 14,744 | 17,138 | ||||||||||||||
| Loans held for sale | 2,996 | 1,706 | 1,628 | 2,410 | 1,576 | ||||||||||||||
| Loans, net of allowance for credit losses of $25,826 12/31/24 and $25,024 12/31/23 | 2,536,043 | 2,512,852 | 2,534,468 | 2,516,687 | 2,556,167 | ||||||||||||||
| Premises and equipment | 33,828 | 33,779 | 34,507 | 35,007 | 35,790 | ||||||||||||||
| Construction in progress | - | 35 | 38 | 9 | 8 | ||||||||||||||
| Goodwill | 86,358 | 86,358 | 86,358 | 86,358 | 86,358 | ||||||||||||||
| Loan servicing rights | 5,656 | 5,644 | 5,504 | 5,555 | 5,648 | ||||||||||||||
| Bank owned life insurance | 34,872 | 34,624 | 34,359 | 34,123 | 33,907 | ||||||||||||||
| Other assets | 45,181 | 46,047 | 49,552 | 54,628 | 43,218 | ||||||||||||||
| Total Assets | $ | 3,364,723 | $ | 3,389,185 | $ | 3,322,633 | $ | 3,287,554 | $ | 3,283,229 | |||||||||
| Liabilities and Stockholders' Equity | |||||||||||||||||||
| Liabilities | |||||||||||||||||||
| Deposits | |||||||||||||||||||
| Noninterest-bearing | $ | 516,904 | $ | 481,444 | $ | 479,069 | $ | 510,731 | $ | 528,465 | |||||||||
| Interest-bearing | |||||||||||||||||||
| NOW accounts | 850,462 | 865,617 | 821,145 | 829,236 | 816,790 | ||||||||||||||
| Savings | 671,818 | 661,565 | 673,284 | 635,430 | 599,191 | ||||||||||||||
| Time | 647,581 | 676,187 | 667,592 | 645,985 | 663,017 | ||||||||||||||
| Total deposits | 2,686,765 | 2,684,813 | 2,641,090 | 2,621,382 | 2,607,463 | ||||||||||||||
| Federal funds purchased and securities | |||||||||||||||||||
| sold under agreements to repurchase | 27,218 | 27,292 | 27,218 | 28,218 | 28,218 | ||||||||||||||
| Federal Home Loan Bank (FHLB) advances | 246,056 | 263,081 | 266,102 | 256,628 | 265,750 | ||||||||||||||
| Subordinated notes, net of unamortized issuance costs | 34,818 | 34,789 | 34,759 | 34,731 | 34,702 | ||||||||||||||
| Dividend payable | 2,996 | 2,998 | 2,975 | 2,975 | 2,974 | ||||||||||||||
| Accrued expenses and other liabilities | 31,659 | 40,832 | 27,825 | 25,930 | 27,579 | ||||||||||||||
| Total liabilities | 3,029,512 | 3,053,805 | 2,999,969 | 2,969,864 | 2,966,686 | ||||||||||||||
| Commitments and Contingencies | |||||||||||||||||||
| Stockholders' Equity | |||||||||||||||||||
| Common stock - No par value 20,000,000 shares authorized; issued | |||||||||||||||||||
| 14,564,425 shares 12/31/24 and 12/31/23; outstanding 13,699,536 | 135,565 | 135,193 | 135,829 | 135,482 | 135,515 | ||||||||||||||
| shares 12/31/24 and 13,664,641 shares 12/31/23 | |||||||||||||||||||
| Treasury stock - 864,889 shares 12/31/24 and 899,784 shares 12/31/23 | (10,985 | ) | (10,904 | ) | (11,006 | ) | (10,851 | ) | (11,040 | ) | |||||||||
| Retained earnings | 235,854 | 230,465 | 226,430 | 223,648 | 221,080 | ||||||||||||||
| Accumulated other comprehensive loss | (25,223 | ) | (19,374 | ) | (28,589 | ) | (30,589 | ) | (29,012 | ) | |||||||||
| Total stockholders' equity | 335,211 | 335,380 | 322,664 | 317,690 | 316,543 | ||||||||||||||
| Total Liabilities and Stockholders' Equity | $ | 3,364,723 | $ | 3,389,185 | $ | 3,322,633 | $ | 3,287,554 | $ | 3,283,229 | |||||||||
| FARMERS & MERCHANTS BANCORP, INC. AND SUBSIDIARIES SELECT FINANCIAL DATA | |||||||||||||||||||||
| For the Three Months Ended | For the Twelve Months Ended | ||||||||||||||||||||
| Selected financial data | December 31, 2024 | September 30, 2024 | June 30, 2024 | March 31, 2024 | December 31, 2023 | December 31, 2024 | December 31, 2023 | ||||||||||||||
| Return on average assets | 0.99% | 0.78% | 0.69% | 0.66% | 0.67% | 0.78% | 0.71% | ||||||||||||||
| Return on average equity | 10.00% | 7.93% | 7.13% | 6.76% | 7.27% | 7.98% | 7.46% | ||||||||||||||
| Yield on earning assets | 5.20% | 5.27% | 5.22% | 5.00% | 4.93% | 5.17% | 4.67% | ||||||||||||||
| Cost of interest bearing liabilities | 3.01% | 3.21% | 3.18% | 3.06% | 3.02% | 3.12% | 2.53% | ||||||||||||||
| Net interest spread | 2.19% | 2.06% | 2.04% | 1.94% | 1.91% | 2.05% | 2.14% | ||||||||||||||
| Net interest margin | 2.84% | 2.71% | 2.71% | 2.60% | 2.57% | 2.72% | 2.72% | ||||||||||||||
| Efficiency | 59.82% | 67.98% | 69.03% | 74.08% | 69.23% | 67.54% | 68.48% | ||||||||||||||
| Dividend payout ratio | 35.75% | 45.99% | 52.35% | 55.52% | 54.23% | 46.07% | 50.65% | ||||||||||||||
| Tangible book value per share | $ | 17.74 | $ | 17.72 | $ | 16.79 | $ | 16.39 | $ | 16.29 | |||||||||||
| Tier 1 leverage ratio | 8.12% | 8.04% | 8.02% | 8.40% | 8.20% | ||||||||||||||||
| Average shares outstanding | 13,699,869 | 13,687,119 | 13,681,501 | 13,671,166 | 13,665,773 | 13,679,955 | 13,641,336 | ||||||||||||||
| Loans | December 31, 2024 | September 30, 2024 | June 30, 2024 | March 31, 2024 | December 31, 2023 | ||||||||||||||||
| (Dollar amounts in thousands) | |||||||||||||||||||||
| Commercial real estate | $ | 1,310,811 | $ | 1,301,160 | $ | 1,303,598 | $ | 1,304,400 | $ | 1,337,766 | |||||||||||
| Agricultural real estate | 216,401 | 220,328 | 222,558 | 227,455 | 223,791 | ||||||||||||||||
| Consumer real estate | 520,114 | 524,055 | 525,902 | 525,178 | 521,895 | ||||||||||||||||
| Commercial and industrial | 275,152 | 260,732 | 268,426 | 256,051 | 254,935 | ||||||||||||||||
| Agricultural | 152,080 | 137,252 | 142,909 | 127,670 | 132,560 | ||||||||||||||||
| Consumer | 63,009 | 67,394 | 70,918 | 74,819 | 79,591 | ||||||||||||||||
| Other | 24,978 | 25,916 | 26,449 | 26,776 | 30,136 | ||||||||||||||||
| Less: Net deferred loan fees, costs and other (1) | (676) | 1,499 | (1,022) | (982) | 517 | ||||||||||||||||
| Total loans, net | $ | 2,561,869 | $ | 2,538,336 | $ | 2,559,738 | $ | 2,541,367 | $ | 2,581,191 | |||||||||||
| Asset quality data | December 31, 2024 | September 30, 2024 | June 30, 2024 | March 31, 2024 | December 31, 2023 | ||||||||||||||||
| (Dollar amounts in thousands) | |||||||||||||||||||||
| Nonaccrual loans | $ | 3,124 | $ | 2,898 | $ | 2,487 | $ | 19,391 | $ | 22,353 | |||||||||||
| 90 day past due and accruing | $ | - | $ | - | $ | - | $ | - | $ | - | |||||||||||
| Nonperforming loans | $ | 3,124 | $ | 2,898 | $ | 2,487 | $ | 19,391 | $ | 22,353 | |||||||||||
| Other real estate owned | $ | - | $ | - | $ | - | $ | - | $ | - | |||||||||||
| Nonperforming assets | $ | 3,124 | $ | 2,898 | $ | 2,487 | $ | 19,391 | $ | 22,353 | |||||||||||
| Allowance for credit losses | $ | 25,826 | $ | 25,484 | $ | 25,270 | $ | 24,680 | $ | 25,024 | |||||||||||
| Allowance for unfunded | 1,541 | 1,661 | 1,928 | 1,946 | 2,212 | ||||||||||||||||
| Total allowance for credit losses | $ | 27,367 | $ | 27,145 | $ | 27,198 | $ | 26,626 | $ | 27,236 | |||||||||||
| Total allowance for credit losses/total loans | 1.07% | 1.07% | 1.06% | 1.05% | 1.06% | ||||||||||||||||
| Adjusted credit losses with accretable yield/total loans | 1.08% | 1.10% | 1.10% | 1.11% | 1.13% | ||||||||||||||||
| Net charge-offs: | |||||||||||||||||||||
| Quarter-to-date | $ | 4 | $ | 68 | $ | 15 | $ | 55 | $ | 531 | |||||||||||
| Year-to-date | $ | 142 | $ | 138 | $ | 70 | $ | 55 | $ | 551 | |||||||||||
| Net charge-offs to average loans | |||||||||||||||||||||
| Quarter-to-date | 0.00% | 0.00% | 0.00% | 0.00% | 0.02% | ||||||||||||||||
| Year-to-date | 0.01% | 0.01% | 0.00% | 0.00% | 0.02% | ||||||||||||||||
| Nonperforming loans/total loans | 0.12% | 0.11% | 0.10% | 0.76% | 0.87% | ||||||||||||||||
| Allowance for credit losses/nonperforming loans | 826.70% | 879.37% | 1016.08% | 127.28% | 111.95% | ||||||||||||||||
| NPA coverage ratio | 826.70% | 879.37% | 1016.08% | 127.28% | 111.95% | ||||||||||||||||
| (1) Includes carrying value adjustments of $1.1 million as of December 31, 2024, $3.0 million as of September 30, 2024, $612 thousand as of June 30, 2024, $969 thousand as of March 31, 2024 and $2.7 million as of December 31, 2023 related to interest rate swaps | |||||||||||||||||||||
| FARMERS & MERCHANTS BANCORP, INC. AND SUBSIDIARIES AVERAGE BALANCE SHEETS AND RELATED YIELDS AND RATES (in thousands of dollars, except percentages) | |||||||||||||||||
| For the Three Months Ended | For the Three Months Ended | ||||||||||||||||
| December 31, 2024 | December 31, 2023 | ||||||||||||||||
| Interest Earning Assets: | Average Balance | Interest/ Dividends | Annualized Yield/Rate | Average Balance | Interest/ Dividends | Annualized Yield/Rate | |||||||||||
| Loans | $ | 2,543,628 | $ | 36,663 | 5.77 | % | $ | 2,553,023 | $ | 34,493 | 5.41 | % | |||||
| Taxable investment securities | 450,648 | 2,554 | 2.27 | % | 386,931 | 1,660 | 1.72 | % | |||||||||
| Tax-exempt investment securities | 18,571 | 79 | 2.15 | % | 24,145 | 89 | 1.87 | % | |||||||||
| Fed funds sold & other | 209,307 | 2,555 | 4.88 | % | 142,642 | 2,028 | 5.69 | % | |||||||||
| Total Interest Earning Assets | 3,222,154 | $ | 41,851 | 5.20 | % | 3,106,741 | $ | 38,270 | 4.93 | % | |||||||
| Nonearning Assets | 174,172 | 189,202 | |||||||||||||||
| Total Assets | $ | 3,396,326 | $ | 3,295,943 | |||||||||||||
| Interest Bearing Liabilities: | |||||||||||||||||
| Savings deposits | $ | 1,548,638 | $ | 9,459 | 2.44 | % | $ | 1,392,304 | $ | 8,570 | 2.46 | % | |||||
| Other time deposits | 666,896 | 6,290 | 3.77 | % | 701,347 | 6,445 | 3.68 | % | |||||||||
| Other borrowed money | 255,490 | 2,713 | 4.25 | % | 265,948 | 2,742 | 4.12 | % | |||||||||
| Fed funds purchased & securities | |||||||||||||||||
| sold under agreement to repurchase | 27,341 | 274 | 4.01 | % | 28,739 | 293 | 4.08 | % | |||||||||
| Subordinated notes | 34,799 | 285 | 3.28 | % | 34,683 | 285 | 3.29 | % | |||||||||
| Total Interest Bearing Liabilities | $ | 2,533,164 | $ | 19,021 | 3.01 | % | $ | 2,423,021 | $ | 18,335 | 3.02 | % | |||||
| Noninterest Bearing Liabilities | 527,751 | 567,813 | |||||||||||||||
| Stockholders' Equity | $ | 335,411 | $ | 305,109 | |||||||||||||
| Net Interest Income and Interest Rate Spread | $ | 22,830 | 2.19 | % | $ | 19,935 | 1.91 | % | |||||||||
| Net Interest Margin | 2.84 | % | 2.57 | % | |||||||||||||
| Yields on Tax exempt securities and the portion of the tax-exempt IDB loans included in loans have been tax adjusted based on a 21% tax rate in the charts | |||||||||||||||||
| For the Twelve Months Ended | For the Twelve Months Ended | ||||||||||||||||
| December 31, 2024 | December 31, 2023 | ||||||||||||||||
| Interest Earning Assets: | Average Balance | Interest/ Dividends | Annualized Yield/Rate | Average Balance | Interest/ Dividends | Annualized Yield/Rate | |||||||||||
| Loans | $ | 2,557,213 | $ | 145,329 | 5.68 | % | $ | 2,491,502 | $ | 129,344 | 5.19 | % | |||||
| Taxable investment securities | 410,764 | 8,129 | 1.98 | % | 394,424 | 6,204 | 1.57 | % | |||||||||
| Tax-exempt investment securities | 20,154 | 328 | 2.06 | % | 24,686 | 366 | 1.88 | % | |||||||||
| Fed funds sold & other | 176,307 | 9,786 | 5.55 | % | 85,018 | 3,894 | 4.58 | % | |||||||||
| Total Interest Earning Assets | 3,164,438 | $ | 163,572 | 5.17 | % | 2,995,630 | $ | 139,808 | 4.67 | % | |||||||
| Nonearning Assets | 164,464 | 197,726 | |||||||||||||||
| Total Assets | $ | 3,328,902 | $ | 3,193,356 | |||||||||||||
| Interest Bearing Liabilities: | |||||||||||||||||
| Savings deposits | $ | 1,502,365 | $ | 39,750 | 2.65 | % | $ | 1,376,318 | $ | 27,424 | 1.99 | % | |||||
| Other time deposits | 663,320 | 24,713 | 3.73 | % | 640,390 | 19,499 | 3.04 | % | |||||||||
| Other borrowed money | 262,094 | 10,948 | 4.18 | % | 220,175 | 8,876 | 4.03 | % | |||||||||
| Fed funds purchased & securities | |||||||||||||||||
| sold under agreement to repurchase | 27,750 | 1,111 | 4.00 | % | 35,421 | 1,474 | 4.16 | % | |||||||||
| Subordinated notes | 34,755 | 1,138 | 3.27 | % | 34,640 | 1,138 | 3.29 | % | |||||||||
| Total Interest Bearing Liabilities | $ | 2,490,284 | $ | 77,660 | 3.12 | % | $ | 2,306,944 | $ | 58,411 | 2.53 | % | |||||
| Noninterest Bearing Liabilities | 513,588 | 580,931 | |||||||||||||||
| Stockholders' Equity | $ | 325,030 | $ | 305,481 | |||||||||||||
| Net Interest Income and Interest Rate Spread | $ | 85,912 | 2.05 | % | $ | 81,397 | 2.14 | % | |||||||||
| Net Interest Margin | 2.72 | % | 2.72 | % | |||||||||||||
| Yields on Tax exempt securities and the portion of the tax-exempt IDB loans included in loans have been tax adjusted based on a 21% tax rate in the charts | |||||||||||||||||
| FARMERS & MERCHANTS BANCORP, INC. AND SUBSIDIARIES AVERAGE BALANCE SHEETS AND RELATED YIELDS AND RATES (in thousands of dollars, except percentages) | |||||||||||||||||||||||||||||||
| For the Three Months Ended December 31, 2024 | For the Three Months Ended December 31, 2023 | ||||||||||||||||||||||||||||||
| As Reported | Excluding Acc/Amort | Difference | As Reported | Excluding Acc/Amort | Difference | ||||||||||||||||||||||||||
| $ | Yield | $ | Yield | $ | Yield | $ | Yield | $ | Yield | $ | Yield | ||||||||||||||||||||
| Interest Earning Assets: | |||||||||||||||||||||||||||||||
| Loans | $ | 36,663 | 5.77 | % | $ | 36,039 | 5.67 | % | $ | 624 | 0.10 | % | $ | 34,493 | 5.41 | % | $ | 33,769 | 5.29 | % | $ | 724 | 0.12 | % | |||||||
| Taxable investment securities | 2,554 | 2.27 | % | 2,554 | 2.27 | % | - | 0.00 | % | 1,660 | 1.72 | % | 1,660 | 1.72 | % | - | 0.00 | % | |||||||||||||
| Tax-exempt investment securities | 79 | 2.15 | % | 79 | 2.15 | % | - | 0.00 | % | 89 | 1.87 | % | 89 | 1.87 | % | - | 0.00 | % | |||||||||||||
| Fed funds sold & other | 2,555 | 4.88 | % | 2,555 | 4.88 | % | - | 0.00 | % | 2,028 | 5.69 | % | 2,028 | 5.69 | % | - | 0.00 | % | |||||||||||||
| Total Interest Earning Assets | 41,851 | 5.20 | % | 41,227 | 5.12 | % | 624 | 0.08 | % | 38,270 | 4.93 | % | 37,546 | 4.84 | % | 724 | 0.09 | % | |||||||||||||
| Interest Bearing Liabilities: | |||||||||||||||||||||||||||||||
| Savings deposits | $ | 9,459 | 2.44 | % | $ | 9,459 | 2.44 | % | $ - | 0.00 | % | $ | 8,570 | 2.46 | % | $ | 8,570 | 2.46 | % | $ - | 0.00 | % | |||||||||
| Other time deposits | 6,290 | 3.77 | % | 6,290 | 3.77 | % | - | 0.00 | % | 6,445 | 3.68 | % | 6,381 | 3.64 | % | 64 | 0.04 | % | |||||||||||||
| Other borrowed money | 2,713 | 4.25 | % | 2,710 | 4.24 | % | 3 | 0.01 | % | 2,742 | 4.12 | % | 2,760 | 4.15 | % | (18 | ) | -0.03 | % | ||||||||||||
| Federal funds purchased and | |||||||||||||||||||||||||||||||
| securities sold under agreement to | |||||||||||||||||||||||||||||||
| repurchase | 274 | 4.01 | % | 274 | 4.01 | % | - | 0.00 | % | 293 | 4.08 | % | 293 | 4.08 | % | - | 0.00 | % | |||||||||||||
| Subordinated notes | 285 | 3.28 | % | 285 | 3.28 | % | - | 0.00 | % | 285 | 3.29 | % | 285 | 3.29 | % | - | 0.00 | % | |||||||||||||
| Total Interest Bearing Liabilities | 19,021 | 3.01 | % | 19,018 | 3.00 | % | 3 | 0.01 | % | 18,335 | 3.02 | % | 18,289 | 3.02 | % | 46 | 0.00 | % | |||||||||||||
| Interest/Dividend income/yield | 41,851 | 5.20 | % | 41,227 | 5.12 | % | 624 | 0.08 | % | 38,270 | 4.93 | % | 37,546 | 4.84 | % | 724 | 0.09 | % | |||||||||||||
| Interest Expense / yield | 19,021 | 3.01 | % | 19,018 | 3.00 | % | 3 | 0.01 | % | 18,335 | 3.02 | % | 18,289 | 3.02 | % | 46 | 0.00 | % | |||||||||||||
| Net Interest Spread | 22,830 | 2.19 | % | 22,209 | 2.12 | % | 621 | 0.07 | % | 19,935 | 1.91 | % | 19,257 | 1.82 | % | 678 | 0.09 | % | |||||||||||||
| Net Interest Margin | 2.84 | % | 2.76 | % | 0.08 | % | 2.57 | % | 2.48 | % | 0.09 | % | |||||||||||||||||||
| For the Twelve Months Ended December 31, 2024 | For the Twelve Months Ended December 31, 2023 | ||||||||||||||||||||||||||||||
| As Reported | Excluding Acc/Amort | Difference | As Reported | Excluding Acc/Amort | Difference | ||||||||||||||||||||||||||
| $ | Yield | $ | Yield | $ | Yield | $ | Yield | $ | Yield | $ | Yield | ||||||||||||||||||||
| Interest Earning Assets: | |||||||||||||||||||||||||||||||
| Loans | $ | 145,329 | 5.68 | % | $ | 142,627 | 5.58 | % | $ | 2,702 | 0.10 | % | $ | 129,344 | 5.19 | % | $ | 126,133 | 5.06 | % | $ | 3,211 | 0.13 | % | |||||||
| Taxable investment securities | 8,129 | 1.98 | % | 8,129 | 1.98 | % | - | 0.00 | % | 6,204 | 1.57 | % | 6,204 | 1.57 | % | - | 0.00 | % | |||||||||||||
| Tax-exempt investment securities | 328 | 2.06 | % | 328 | 2.06 | % | - | 0.00 | % | 366 | 1.88 | % | 366 | 1.88 | % | - | 0.00 | % | |||||||||||||
| Fed funds sold & other | 9,786 | 5.55 | % | 9,786 | 5.55 | % | - | 0.00 | % | 3,894 | 4.58 | % | 3,894 | 4.58 | % | - | 0.00 | % | |||||||||||||
| Total Interest Earning Assets | 163,572 | 5.17 | % | 160,870 | 5.09 | % | 2,702 | 0.08 | % | 139,808 | 4.67 | % | 136,597 | 4.57 | % | 3,211 | 0.10 | % | |||||||||||||
| Interest Bearing Liabilities: | |||||||||||||||||||||||||||||||
| Savings deposits | $ | 39,750 | 2.65 | % | $ | 39,750 | 2.65 | % | $ - | 0.00 | % | $ | 27,424 | 1.99 | % | $ | 27,424 | 1.99 | % | $ - | 0.00 | % | |||||||||
| Other time deposits | 24,713 | 3.73 | % | 24,713 | 3.73 | % | - | 0.00 | % | 19,499 | 3.04 | % | 19,839 | 3.10 | % | (340 | ) | -0.06 | % | ||||||||||||
| Other borrowed money | 10,948 | 4.18 | % | 10,964 | 4.18 | % | (16 | ) | 0.00 | % | 8,876 | 4.03 | % | 8,947 | 4.06 | % | (71 | ) | -0.03 | % | |||||||||||
| Federal funds purchased and | |||||||||||||||||||||||||||||||
| securities sold under agreement to | |||||||||||||||||||||||||||||||
| repurchase | 1,111 | 4.00 | % | 1,111 | 4.00 | % | - | 0.00 | % | 1,474 | 4.16 | % | 1,474 | 4.16 | % | - | 0.00 | % | |||||||||||||
| Subordinated notes | 1,138 | 3.27 | % | 1,138 | 3.27 | % | - | 0.00 | % | 1,138 | 3.29 | % | 1,138 | 3.29 | % | - | 0.00 | % | |||||||||||||
| Total Interest Bearing Liabilities | 77,660 | 3.12 | % | 77,676 | 3.12 | % | (16 | ) | 0.00 | % | 58,411 | 2.53 | % | 58,822 | 2.55 | % | (411 | ) | -0.02 | % | |||||||||||
| Interest/Dividend income/yield | 163,572 | 5.17 | % | 160,870 | 5.09 | % | 2,702 | 0.08 | % | 139,808 | 4.67 | % | 136,597 | 4.57 | % | 3,211 | 0.10 | % | |||||||||||||
| Interest Expense / yield | 77,660 | 3.12 | % | 77,676 | 3.12 | % | (16 | ) | 0.00 | % | 58,411 | 2.53 | % | 58,822 | 2.55 | % | (411 | ) | -0.02 | % | |||||||||||
| Net Interest Spread | 85,912 | 2.05 | % | 83,194 | 1.97 | % | 2,718 | 0.08 | % | 81,397 | 2.14 | % | 77,775 | 2.02 | % | 3,622 | 0.12 | % | |||||||||||||
| Net Interest Margin | 2.72 | % | 2.63 | % | 0.09 | % | 2.72 | % | 2.60 | % | 0.12 | % | |||||||||||||||||||
| Company Contact: | Investor and Media Contact: |
| Lars B. Eller President and Chief Executive Officer Farmers & Merchants Bancorp, Inc. (419) 446-2501 leller@fm.bank | Andrew M. Berger Managing Director SM Berger & Company, Inc. (216) 464-6400 andrew@smberger.com |
