Farmers & Merchants Bancorp (FMCB) Reports Record Second Quarter 2025 Earnings
Rhea-AI Summary
Farmers & Merchants Bancorp (OTCQX: FMCB) reported exceptional second quarter 2025 financial results, with record net income of $23.1 million, up 5.9% year-over-year. The bank achieved diluted earnings per share of $32.94, representing a 12.1% increase from Q2 2024.
Key performance metrics include a return on average assets of 1.65%, return on average equity of 15.09%, and an improved efficiency ratio of 44.88%. The bank maintained strong liquidity with $291.8 million in cash and $1.3 billion in investment securities. Total deposits reached $4.8 billion, while maintaining a conservative loan-to-deposit ratio of 76.38%.
The company declared a mid-year cash dividend of $9.30 per share, marking its 90th consecutive year of dividend payments and 60th consecutive year of dividend increases. Credit quality remained exceptional with no non-accrual loans and a minimal delinquency ratio of 0.03%.
Positive
- Record Q2 net income of $23.1 million, up 5.9% year-over-year
- Diluted EPS increased 12.1% to $32.94 compared to Q2 2024
- Strong liquidity position with $291.8 million cash and $2.1 billion borrowing capacity
- 90 consecutive years of dividend payments with 60 years of consecutive increases
- Excellent credit quality with zero non-accrual loans and 0.03% delinquency ratio
- Improved net interest margin to 4.13% for H1 2025
- Strong capital position with 15.35% total risk-based capital ratio
Negative
- Total loans decreased $54.4 million or 1.5% from December 31, 2024
- Return on average equity declined to 15.09% from 15.33% in Q2 2024
- Efficiency ratio increased to 44.88% from 43.86% in Q1 2025
News Market Reaction
On the day this news was published, FMCB gained 0.11%, reflecting a mild positive market reaction.
Data tracked by StockTitan Argus on the day of publication.
Second Quarter 2025 Highlights
- Net income of
$23.1 million , an increase of$1.3 million or5.9% compared to the second quarter of 2024; - Basic earnings per share of
$33.06 and diluted earnings per share of$32.94 ; diluted earnings per share up12.1% compared to the second quarter of 2024; - Diluted earnings per share of
$126.87 over the trailing twelve months, up7.8% compared to$117.73 over the same trailing period a year ago and15.2% compared to$110.10 for the same period two years ago; - Tangible book value per share increased
9.7% to$835.33 compared to$761.62 as of June 30, 2024; - Achieved a return on average assets of
1.65% and a return on average equity of15.09% ; - Net interest income of
$53.9 million , up$3.1 million or6.1% compared to$50.8 million in the second quarter of 2024; net interest margin (tax equivalent basis) of4.07% , up from3.91% in the second quarter of 2024; - Continued cost discipline resulted in an efficiency ratio of
44.88% ; - Liquidity position remains strong with
$291.8 million in cash,$1.3 billion in investment securities, of which$573.0 million are available-for-sale, no borrowings and a borrowing capacity of$2.1 billion as of June 30, 2025; - Continued to grow our solid capital position with a preliminary total risk-based capital ratio of
15.35% , common equity tier 1 ratio of13.87% , tier 1 leverage ratio of11.18% and a tangible common equity ratio of11.08% ; - Credit quality remains resilient with an allowance for credit losses on loans and leases of
2.09% ; net charge-off ratio of0.02% for the quarter and no non-accrual loans or leases at quarter-end.
LODI, Calif., July 17, 2025 (GLOBE NEWSWIRE) -- Farmers & Merchants Bancorp (OTCQX: FMCB) (the “Company” or “FMCB”), the parent company of Farmers & Merchants Bank of Central California (the “Bank” or “F&M Bank”), reported record second quarter net income of
Net income over the trailing twelve months was
During the quarter, the Company declared a mid-year cash dividend of
CEO Commentary
Kent Steinwert, Farmers & Merchants Bancorp’s Chairman, President and Chief Executive Officer, stated, “We are very pleased with the Company’s financial performance in the second quarter of 2025, highlighted by record second quarter net income of
Mr. Steinwert continued, “I am pleased to announce that Bank Director Magazine just released their annual ranking of the top performing banks for 2024 and Farmers & Merchants Bancorp was ranked the #3 bank in the nation across all asset categories. This follows our #2 ranking for 2023 and #1 ranking for 2022. Bank Director’s recognition of our performance over the last three years validates the success of our strategy and commitment to our clients, employees, shareholders and communities.”
Earnings
Net interest income for the quarter ended June 30, 2025 was
Balance Sheet
Total assets at quarter-end were
Credit Quality
The Company’s credit quality remained solid with no non-accrual loans and leases as of June 30, 2025 and a negligible delinquency ratio of
Capital
The Company’s and Bank’s regulatory capital ratios continued to strengthen during the second quarter of 2025. The growth in capital was driven by net income of
About Farmers & Merchants Bancorp
Farmers & Merchants Bancorp, trades on the OTCQX under the symbol FMCB, and is the parent company of Farmers & Merchants Bank of Central California, also known as F&M Bank. Founded in 1916, F&M Bank is a locally owned and operated community bank, which proudly serves California through 33 convenient locations. F&M Bank is financially strong, with
Farmers & Merchants Bancorp has paid dividends for 90 consecutive years and has increased dividends for 60 consecutive years. As a result, Farmers & Merchants Bancorp is a member of a select group of only 55 publicly traded companies referred to as “Dividend Kings,” and is ranked 17th in that group based on consecutive years of dividend increases. A “Dividend King” is a stock with 50 or more consecutive years of dividend increase.
In July 2025, Farmers & Merchants Bancorp was named by Bank Director’s Magazine as the #3 best performing bank in the nation across all asset categories in their annual “Ranking Banking” study of the top performing banks for 2024. In July 2024, Farmers & Merchants Bancorp was named by Bank Director’s Magazine as the #2 best performing bank in the nation across all asset categories in their annual “Ranking Banking” study of the top performing banks for 2023. In July 2023, the Bank was named by Bank Director’s Magazine as the #1 best performing bank in the nation across all asset categories in their annual “Ranking Banking” study of the top performing banks for 2022.
In April 2024, F&M Bank was ranked 6th on Forbes Magazine’s list of "America’s Best Banks" in 2023. Forbes’ annual “America’s Best Banks” list looks at ten metrics measuring growth, credit quality, profitability, and capital for the 2023 calendar year, as well as stock performance in the 12 months through March 18, 2024.
In December 2023, F&M Bank was ranked 4th on S&P Global Market Intelligence's “Top 50 List of Best-Performing Community Banks” in the US with assets between
In October 2021, F&M Bank was named the “Best Community Bank in California” by Newsweek magazine. Newsweek’s ranking recognizes those financial institutions that best serve their customers’ needs in each state. This recognition speaks to the superior customer service the F&M Bank team members provide to its clients.
F&M Bank is the 18th largest bank lender to agriculture in the United States. F&M Bank operates in the mid-Central Valley of California, including Sacramento, San Joaquin, Solano, Stanislaus, and Merced counties and the east region of the San Francisco Bay Area, including Napa, Alameda and Contra Costa counties.
F&M Bank was inducted into the National Agriculture Science Center’s “Ag Hall of Fame” at the end of 2021 for providing resources, financial advice, guidance, and support to the agribusiness communities as well as to students in the next generation of agribusiness workforce. F&M Bank is dedicated to helping California remain the premier agricultural region in the world and will continue to work with the next generation of farmers, ranchers, and processors. F&M Bank remains committed to servicing the needs of agribusiness in California as has been the case since its founding over 109 years ago.
F&M Bank offers a full complement of loan, deposit, equipment leasing and treasury management products to businesses, as well as a full suite of consumer banking products. The FDIC awarded F&M Bank the highest possible rating of "Outstanding" in their last Community Reinvestment Act (“CRA”) evaluation.
Forward-Looking Statements
This press release may contain certain forward-looking statements that are based on management's current expectations regarding the Company’s financial performance. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include words such as “believe,” “expect,” “intend,” “estimate” or words of similar meaning, or future or conditional verbs such as “will,” “would,” “should,” “could” or “may.” Forward-looking statements in this press release include, without limitation, statements regarding loan and deposit production levels of net interest margin, the ability to control costs and expenses, the competitive environment, financial and regulatory policies of the United States government, general economic conditions, inflation, recessions, tariffs, economic uncertainty in the United States, and changes in interest rates. Forward-looking statements in this earnings release include matters that involve known and unknown risks, uncertainties and other factors that may cause actual results to differ materially from results expressed or implied by such forward-looking statements. Such risk factors include, among others: the effects of and changes in monetary and fiscal policies, including the interest rate policies of the Federal Reserve Board and their effects on inflation risk; political and economic uncertainty, including any decline in global, domestic or local economic conditions or the stability of credit and financial markets; and other relevant risks detailed in the Company’s Form 10-K, Form 10-Qs, and various other securities law filings made periodically by the Company, copies of which are available from the Company’s website. All such factors are difficult to predict and are beyond the Company's ability to control or predict. There also may be additional risks that the Company does not presently know, or that the Company currently believes to be immaterial, that could also cause actual results to differ materially and adversely from those contained in these forward-looking statements. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or circumstances after the date of this press release or otherwise, except as may be required by applicable law.
For more information about Farmers & Merchants Bancorp and F&M Bank, visit fmbonline.com.
Investor Relations Contact
Farmers & Merchants Bancorp
Bart R. Olson
Executive Vice President and Chief Financial Officer
Phone: 209-367-2485
bolson@fmbonline.com
| FINANCIAL HIGHLIGHTS | ||||||||||||||||||||||
| Three-Months Ended | Six-Months Ended | |||||||||||||||||||||
| (dollars in thousands, except per share amounts) | June 30, 2025 | March 31, 2025 | June 30, 2024 | June 30, 2025 | June 30, 2024 | |||||||||||||||||
| Earnings and Profitability: | ||||||||||||||||||||||
| Interest income | $ | 70,061 | $ | 67,138 | $ | 69,831 | $ | 137,199 | $ | 136,472 | ||||||||||||
| Interest expense | 16,193 | 13,997 | 19,050 | 30,190 | 33,978 | |||||||||||||||||
| Net interest income | 53,868 | 53,141 | 50,781 | 107,009 | 102,494 | |||||||||||||||||
| Provision for credit losses | 1,400 | 300 | - | 1,700 | - | |||||||||||||||||
| Noninterest income | 5,519 | 5,021 | 4,767 | 10,540 | 9,842 | |||||||||||||||||
| Noninterest expense | 26,651 | 25,509 | 25,422 | 52,160 | 50,943 | |||||||||||||||||
| Income before taxes | 31,336 | 32,353 | 30,126 | 63,689 | 61,393 | |||||||||||||||||
| Income tax expense | 8,281 | 9,344 | 8,359 | 17,625 | 16,903 | |||||||||||||||||
| Net income | $ | 23,055 | $ | 23,009 | $ | 21,767 | $ | 46,064 | $ | 44,490 | ||||||||||||
| Basic earnings per share | $ | 33.06 | $ | 32.88 | $ | 29.39 | $ | 65.94 | $ | 59.95 | ||||||||||||
| Diluted earnings per share | $ | 32.94 | $ | 32.86 | $ | 29.39 | $ | 65.80 | $ | 59.95 | ||||||||||||
| Weighted Average Shares Outstanding - Basic | 697,332 | 699,736 | 740,752 | 698,527 | 742,150 | |||||||||||||||||
| Weighted Average Shares Outstanding - Diluted | 699,852 | 700,215 | 740,752 | 700,102 | 742,150 | |||||||||||||||||
| Return on average assets | 1.65 | % | 1.70 | % | 1.58 | % | 1.67 | % | 1.65 | % | ||||||||||||
| Return on average equity | 15.09 | % | 15.65 | % | 15.33 | % | 15.37 | % | 15.82 | % | ||||||||||||
| Loan yield | 6.08 | % | 6.07 | % | 6.13 | % | 6.07 | % | 6.11 | % | ||||||||||||
| Cost of average total deposits | 1.31 | % | 1.17 | % | 1.51 | % | 1.25 | % | 1.39 | % | ||||||||||||
| Net interest margin - tax equivalent | 4.07 | % | 4.20 | % | 3.91 | % | 4.13 | % | 4.02 | % | ||||||||||||
| Effective tax rate | 26.43 | % | 28.88 | % | 27.75 | % | 27.67 | % | 27.53 | % | ||||||||||||
| Efficiency ratio | 44.88 | % | 43.86 | % | 45.77 | % | 44.37 | % | 45.35 | % | ||||||||||||
| Book value per share | $ | 852.72 | $ | 825.18 | $ | 779.40 | $ | 852.72 | $ | 779.40 | ||||||||||||
| Tangible book value per share | $ | 835.33 | $ | 843.33 | $ | 761.62 | $ | 835.33 | $ | 761.62 | ||||||||||||
| Balance Sheet: | ||||||||||||||||||||||
| Total assets | $ | 5,478,773 | $ | 5,680,024 | $ | 5,267,485 | $ | 5,478,773 | $ | 5,267,485 | ||||||||||||
| Cash and cash equivalents | 291,752 | 607,254 | 295,936 | 291,752 | 295,936 | |||||||||||||||||
| of which held at Fed | 178,999 | 515,758 | 225,676 | 178,999 | 225,676 | |||||||||||||||||
| Total investment securities | 1,321,812 | 1,255,204 | 1,046,210 | 1,321,812 | 1,046,210 | |||||||||||||||||
| of which available-for-sale | 572,951 | 495,433 | 251,413 | 572,951 | 251,413 | |||||||||||||||||
| of which held-to-maturity | 748,861 | 759,771 | 794,797 | 748,861 | 794,797 | |||||||||||||||||
| Gross loans and leases | 3,635,831 | 3,595,511 | 3,692,237 | 3,635,831 | 3,692,237 | |||||||||||||||||
| Allowance for credit losses - loans and leases | 76,169 | 75,423 | 74,432 | 76,169 | 74,432 | |||||||||||||||||
| Total deposits | 4,760,364 | 4,977,968 | 4,597,055 | 4,760,364 | 4,597,055 | |||||||||||||||||
| Subordinated debentures | 10,310 | 10,310 | 10,310 | 10,310 | 10,310 | |||||||||||||||||
| Total shareholders' equity | $ | 618,532 | $ | 602,306 | $ | 576,220 | $ | 618,532 | $ | 576,220 | ||||||||||||
| Loan-to-deposit ratio | 76.38 | % | 72.23 | % | 80.32 | % | 76.38 | % | 80.32 | % | ||||||||||||
| Percentage of checking deposits to total deposits | 49.23 | % | 50.79 | % | 48.60 | % | 49.23 | % | 48.60 | % | ||||||||||||
| Capital ratios (Bancorp) (1) | ||||||||||||||||||||||
| Common equity tier 1 capital to risk-weighted assets | 13.87 | % | 13.75 | % | 13.09 | % | 13.87 | % | 13.09 | % | ||||||||||||
| Tier 1 capital to risk-weighted assets | 14.09 | % | 13.97 | % | 13.32 | % | 14.09 | % | 13.32 | % | ||||||||||||
| Risk-based capital to risk-weighted assets | 15.35 | % | 15.23 | % | 14.58 | % | 15.35 | % | 14.58 | % | ||||||||||||
| Tier 1 leverage capital ratio | 11.18 | % | 11.32 | % | 10.66 | % | 11.18 | % | 10.66 | % | ||||||||||||
| Tangible common equity ratio (2) | 11.08 | % | 10.40 | % | 10.72 | % | 11.08 | % | 10.72 | % | ||||||||||||
| (1) Capital information is preliminary for June 30, 2025 | ||||||||||||||||||||||
| (2) Non-GAAP measurement | ||||||||||||||||||||||
| Non-GAAP measurement reconciliation: | ||||||||||||||||||||||
| (Dollars in thousands) | June 30, 2025 | March 31, 2025 | June 30, 2024 | |||||||||||||||||||
| Shareholders' equity | $ | 618,532 | $ | 602,306 | $ | 576,220 | ||||||||||||||||
| Less: Intangible assets | 12,609 | 12,740 | 13,145 | |||||||||||||||||||
| Tangible common equity | $ | 605,923 | $ | 589,566 | $ | 563,075 | ||||||||||||||||
| Total assets | $ | 5,478,773 | $ | 5,680,024 | $ | 5,267,485 | ||||||||||||||||
| Less: Intangible assets | 12,609 | 12,740 | 13,145 | |||||||||||||||||||
| Tangible assets | $ | 5,466,164 | $ | 5,667,284 | $ | 5,254,340 | ||||||||||||||||
| Tangible common equity ratio (1) | 11.08 | % | 10.40 | % | 10.72 | % | ||||||||||||||||
| (1) Tangible common equity divided by tangible assets | ||||||||||||||||||||||
FAQ
What was FMCB's earnings per share for Q2 2025?
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