Farmers & Merchants Bank of Long Beach Reports 2026 Third Quarter and Year-to-Date Financial Results
Higher net interest income and margins accompanied a quarterly loss, while the Bank expects to remain profitable for full-year 2026.
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“During the third quarter, we completed an important step toward enhancing long-term earnings power, increasing balance sheet flexibility and supporting future growth, with the strategic repositioning of F&M’s investment securities portfolio,” said W. Henry Walker, Chief Executive Officer. “We were able to replace legacy securities yielding
“On an operating basis, general market conditions remain tight relative to acquiring low-cost deposits, but favorable trends are continuing. The recently announced Federal Reserve increase in interest rates is expected to bode well for us, with both bonds and loans already repricing at higher rates. Moreover, we are investing in technology, including the use of AI, along with attracting new talent and implementing strategies for growth in the years ahead. For the third quarter, F&M’s capital ratios again far exceeded the regulatory capital requirements to meet the definition of a ‘well-capitalized’ financial institution. At F&M, we believe that strong performance starts with getting the fundamentals right. Our team remains focused on operating efficiently, prudently managing risk and maintaining the standards of service and reliability that have long defined our Bank,” Mr. Walker added.
Daniel Walker, F&M’s Executive Chairman of the Board, said, “Our operating performance reflects the strength of a banking model built on trust, personal relationships and a long-term perspective. We are proud of what our team has accomplished and remain committed to serving our customers and communities as we foster the high standards of service and reliability that have long been hallmarks of our Bank and position F&M for continued growth. Proceeding toward the close of 2026, we look forward to celebrating F&M’s 119th anniversary and to the start of 120 years of service, today in
Operating Results
For the third quarter of 2026, total interest and dividend income increased to
Total interest expense for the 2026 third quarter was
Net interest income before provision for credit losses for the 2026 third quarter increased to
F&M’s net interest margin improved to
For the 2026 third quarter, the Bank recorded a
During the 2026 third quarter, F&M recognized a pre-tax loss of
Total non-interest expense for the 2026 third quarter was
The Bank recorded a net loss of
Balance Sheet
During the third quarter of 2026, the Bank sold approximately
Gross loans increased to
F&M’s total deposits at September 30, 2026 amounted to
Securities sold under repurchase agreements increased to
Total assets as of September 30, 2026, were
Capital
Capital ratios are the foundation of safety in all banks, and F&M continues to exceed most national and regional banks in this area, as well as exceeding regulatory capital requirements to meet the definition of a “well-capitalized” financial institution. As of September 30, 2026, the Bank’s total risk-based capital ratio was
Stock Repurchase Program
During the nine months ended September 30, 2026, the Bank repurchased 1,342 shares of its common stock for
Under the stock repurchase program, the Bank may purchase shares of its common stock through various means, including open market transactions and privately negotiated transactions, in each case, subject to applicable requirements and laws. To the extent the Bank repurchases shares, the number of shares repurchased and the timing of any repurchases will depend on a number of factors, including, but not limited to, stock price, trading volume, regulatory requirements, general business conditions and other factors. The Bank may choose to modify, suspend or discontinue such proposed repurchases at any time and anticipates that any such repurchases will be funded from existing cash and cash equivalents or future cash flow. An approved stock repurchase program does not obligate the Bank to repurchase any specific number of shares in any particular period.
About Farmers & Merchants Bank of Long Beach
Farmers & Merchants Bank of Long Beach (F&M) provides a distinctive white-glove banking experience through 27 Southern California branches, from San Clemente to Santa Barbara, and through its secure online and mobile banking platforms. Founded in 1907 by C.J. Walker, and today proudly led by the fourth generation of the Walker family, the Bank has devoted more than a century to building trusted relationships, rooted in personal service, integrity, safety and community commitment. Combining the strength and sophistication of a regional institution with the warmth and responsiveness of a community bank, F&M provides a wide range of commercial and consumer banking services designed to help businesses, individuals and families thrive at every stage of growth. With assets exceeding
Forward-Looking Statements
In addition to the historical information contained herein, this press release may contain forward-looking statements about Farmers & Merchants Bank of Long Beach, including, but not limited to, expectations of reporting net income for the full 2026 year. Readers should understand that such forward-looking statements are neither promises nor guarantees and are subject to various risks and uncertainties, many of which are beyond the Bank’s control. Such risks and uncertainties could cause actual results and actions to differ materially from those contemplated. Factors that could cause or contribute to such differences include, but are not limited to, credit, market, operational, liquidity and interest rate risks associated with the Bank’s business and operations, changes in interest rates, changes in general business and economic conditions, changes in banking laws and regulations, loan losses, increases in expenses, changes in rates charged on loans and earned on investments, accounting estimates and judgments, changes in rates on deposits, competition effects, the amount of non-interest income earned, as well as other factors. Given these factors, readers should not place undue reliance on any forward-looking statement.
FARMERS & MERCHANTS BANK OF LONG BEACH |
||||||||||||||||
Income Statements (Unaudited) |
||||||||||||||||
(In thousands, except share and per share data) |
||||||||||||||||
|
|
|
|
|
|
|
|
|
||||||||
|
|
QTD |
|
YTD |
||||||||||||
|
|
9/30/2026 |
|
9/30/2025 |
|
9/30/2026 |
|
9/30/2025 |
||||||||
| Interest and dividend income: | ||||||||||||||||
| Loans | $ |
86,824 |
|
$ |
76,868 |
|
$ |
242,760 |
|
$ |
227,818 |
|
||||
| Investment securities |
|
29,316 |
|
|
15,661 |
|
|
84,468 |
|
|
52,272 |
|
||||
| Interest-bearing deposits in financial institutions |
|
6,927 |
|
|
16,150 |
|
|
21,840 |
|
|
37,443 |
|
||||
| Investments in FHLB and FRB stock |
|
978 |
|
|
455 |
|
|
2,375 |
|
|
1,360 |
|
||||
| Total interest and dividend income |
|
124,045 |
|
|
109,134 |
|
|
351,443 |
|
|
318,893 |
|
||||
| Interest expense: | ||||||||||||||||
| Deposits |
|
25,963 |
|
|
28,631 |
|
|
76,033 |
|
|
82,975 |
|
||||
| Securities sold under repurchase agreements |
|
7,268 |
|
|
8,267 |
|
|
20,947 |
|
|
24,870 |
|
||||
| Borrowings |
|
1,752 |
|
|
2,982 |
|
|
7,619 |
|
|
10,782 |
|
||||
| Total interest expense |
|
34,983 |
|
|
39,880 |
|
|
104,599 |
|
|
118,627 |
|
||||
| Net interest income before provision for credit losses |
|
89,062 |
|
|
69,254 |
|
|
246,844 |
|
|
200,266 |
|
||||
| Provision (recapture) for credit losses | ||||||||||||||||
| Loans |
|
5,000 |
|
|
(3,600 |
) |
|
3,700 |
|
|
(1,500 |
) |
||||
| Investment securities |
|
(300 |
) |
|
- |
|
|
(300 |
) |
|
- |
|
||||
| Reserve for unfunded loan commitments |
|
(2,500 |
) |
|
1,700 |
|
|
(3,900 |
) |
|
900 |
|
||||
| Total provision (recapture) for credit losses |
|
2,200 |
|
|
(1,900 |
) |
|
(500 |
) |
|
(600 |
) |
||||
| Net interest income after provision (recapture) for credit losses |
|
86,862 |
|
|
71,154 |
|
|
247,344 |
|
|
200,866 |
|
||||
| Non-interest (loss) income: | ||||||||||||||||
| Service charges on deposit accounts |
|
2,151 |
|
|
2,024 |
|
|
6,222 |
|
|
6,061 |
|
||||
| Loss on sale of securities |
|
(84,966 |
) |
|
- |
|
|
(84,966 |
) |
|
- |
|
||||
| Card income |
|
283 |
|
|
239 |
|
|
739 |
|
|
735 |
|
||||
| Other income |
|
2,461 |
|
|
2,156 |
|
|
21,041 |
|
|
6,428 |
|
||||
| Total non-interest (loss) income |
|
(80,071 |
) |
|
4,419 |
|
|
(56,964 |
) |
|
13,224 |
|
||||
| Non-interest expense: | ||||||||||||||||
| Salaries and employee benefits |
|
37,358 |
|
|
32,460 |
|
|
107,047 |
|
|
94,755 |
|
||||
| FDIC and other insurance expense |
|
1,852 |
|
|
2,066 |
|
|
5,284 |
|
|
6,085 |
|
||||
| Occupancy expense |
|
4,468 |
|
|
4,032 |
|
|
12,789 |
|
|
11,980 |
|
||||
| Software and equipment expense |
|
4,951 |
|
|
4,453 |
|
|
14,680 |
|
|
13,344 |
|
||||
| Professional and legal services |
|
2,475 |
|
|
3,362 |
|
|
6,941 |
|
|
7,866 |
|
||||
| Marketing expense |
|
1,588 |
|
|
1,418 |
|
|
4,603 |
|
|
4,319 |
|
||||
| Other expense |
|
4,493 |
|
|
3,556 |
|
|
13,589 |
|
|
10,442 |
|
||||
| Total non-interest expense |
|
57,185 |
|
|
51,347 |
|
|
164,933 |
|
|
148,791 |
|
||||
| (Loss) income before income tax expense |
|
(50,394 |
) |
|
24,226 |
|
|
25,447 |
|
|
65,299 |
|
||||
| Income tax (benefit) expense |
|
(13,612 |
) |
|
6,095 |
|
|
4,810 |
|
|
16,476 |
|
||||
| Net (loss) income | $ |
(36,782 |
) |
$ |
18,131 |
|
$ |
20,637 |
|
$ |
48,823 |
|
||||
| Basic (loss) earnings per common share | $ |
(268.23 |
) |
$ |
148.46 |
|
$ |
150.29 |
|
$ |
399.75 |
|
||||
| Diluted (loss) earnings per common share | $ |
(264.89 |
) |
$ |
147.32 |
|
$ |
148.61 |
|
$ |
396.30 |
|
||||
| Basic weighted-average shares outstanding |
|
120,868 |
|
|
122,126 |
|
|
121,048 |
|
|
122,134 |
|
||||
| Diluted weighted-average shares outstanding |
|
122,392 |
|
|
123,071 |
|
|
122,416 |
|
|
123,198 |
|
||||
FARMERS & MERCHANTS BANK OF LONG BEACH |
||||||||
Balance Sheets (Unaudited) |
||||||||
(In thousands, except share and per share data) |
||||||||
|
|
|
|
|
||||
|
|
Sep. 30, 2026 |
|
Dec. 31, 2025 |
||||
| Assets | ||||||||
| Cash and due from banks: | ||||||||
| Noninterest-bearing balances | $ |
73,273 |
|
$ |
65,062 |
|
||
| Interest-bearing balances |
|
580,245 |
|
|
1,344,503 |
|
||
| Total cash and due from banks |
|
653,518 |
|
|
1,409,565 |
|
||
| Securities available-for-sale, at fair value |
|
3,391,845 |
|
|
839,350 |
|
||
| Securities held-to-maturity, at amortized cost net of allowance for credit losses |
|
- |
|
|
3,266,193 |
|
||
| Loans held for sale |
|
- |
|
|
1,447 |
|
||
| Gross loans |
|
6,948,237 |
|
|
6,076,581 |
|
||
| Unamortized deferred loan fees, net |
|
(12,829 |
) |
|
(10,479 |
) |
||
| Allowance for loan losses |
|
(89,117 |
) |
|
(84,020 |
) |
||
| Loans, net |
|
6,846,291 |
|
|
5,982,082 |
|
||
| Investments in FHLB and FRB stock, at cost |
|
27,723 |
|
|
22,262 |
|
||
| Bank premises and equipment, net |
|
122,490 |
|
|
121,894 |
|
||
| Deferred tax assets, net |
|
140,962 |
|
|
39,839 |
|
||
| Other assets |
|
121,857 |
|
|
114,428 |
|
||
| Total assets | $ |
11,304,686 |
|
$ |
11,797,060 |
|
||
| Liabilities and Stockholders' Equity | ||||||||
| Liabilities: | ||||||||
| Deposits: | ||||||||
| Noninterest-bearing demand deposits | $ |
3,068,595 |
|
$ |
3,095,295 |
|
||
| Interest-bearing demand deposits |
|
1,662,864 |
|
|
1,751,037 |
|
||
| Savings and money market savings |
|
3,269,609 |
|
|
3,084,461 |
|
||
| Time deposits |
|
891,126 |
|
|
1,020,001 |
|
||
| Total deposits |
|
8,892,194 |
|
|
8,950,794 |
|
||
| Securities sold under repurchase agreements |
|
979,225 |
|
|
883,234 |
|
||
| Borrowings |
|
- |
|
|
300,000 |
|
||
| Other liabilities |
|
60,869 |
|
|
56,745 |
|
||
| Total liabilities |
|
9,932,288 |
|
|
10,190,773 |
|
||
| Stockholders' Equity: | ||||||||
| Preferred Stock; issued 16,261 shares |
|
190,884 |
|
|
190,884 |
|
||
| Common Stock, par value |
|
2,409 |
|
|
2,436 |
|
||
| Additional paid-in capital |
|
152,055 |
|
|
162,243 |
|
||
| Retained earnings |
|
1,260,478 |
|
|
1,251,367 |
|
||
| Accumulated other comprehensive loss |
|
(233,428 |
) |
|
(643 |
) |
||
| Total stockholders' equity |
|
1,372,398 |
|
|
1,606,287 |
|
||
| Total liabilities and stockholders' equity | $ |
11,304,686 |
|
$ |
11,797,060 |
|
||
View source version on businesswire.com: https://www.businesswire.com/news/home/20261020021937/en/
Kevin Tiber
President
562-499-4829
Roger Pondel
PondelWilkinson Inc.
Investor Relations
310-279-5980
investor@pondel.com
Source: Farmers & Merchants Bank of Long Beach