Online, October 14, 2016 (Newswire.com) - LONG BEACH, Calif.--Farmers & Merchants Bank of Long Beach (OTCQB: FMBL) today reported financial results for the third quarter ended September 30, 2016.
"The Bank further distinguishes itself by demonstrating consistent financial strength, multi-generational relationships with clients, and a commitment to enhancing the communities we serve through philanthropic contributions."
"As the banking industry continues to navigate a historically low interest rate environment, and confidence in large financial institutions wanes, Farmers & Merchants' strong deposit growth this year is a testament to the sacred trust we share with our clients in the very community where the Bank was founded in 1907," said Henry Walker, president of Farmers & Merchants Bank. "The Bank further distinguishes itself by demonstrating consistent financial strength, multi-generational relationships with clients, and a commitment to enhancing the communities we serve through philanthropic contributions."
Income Statement
For the 2016 third quarter, interest and dividend income rose to $55.7 million from $51.0 million in the 2015 third quarter. Interest and dividend income for the nine-month period ended September 30, 2016 advanced to $166.4 million from $153.0 million reported for the same period in 2015.
Interest expense for the 2016 third quarter was $2.7 million, compared with $2.0 million in last year's third quarter. Interest expense for the nine-month period ended September 30, 2016 was $7.6 million, versus $5.5 million reported for the same period last year.
Net interest income for the 2016 third quarter rose to $53.1 million from $49.1 million for the third quarter of 2015, and increased to $158.9 million for the first nine months of 2016, versus $147.5 million for the same period in 2015.
Farmers & Merchants' net interest margin was 3.44% for the 2016 third quarter, compared with 3.53% for the 2015 third quarter. Net interest margin was 3.54% for the first nine months of 2016, compared with 3.66% for the same period in 2015.
The Bank did not have a provision for loan losses in the first nine months of 2016, nor in the same period a year ago, amid continued strength in its loan portfolio. The Bank's allowance for loan losses as a percentage of loans outstanding was 1.66% at September 30, 2016. Farmers & Merchants' allowance for loan losses as a percentage of loans outstanding was 1.73% at December 31, 2015.
Non-interest income was $6.5 million for the 2016 third quarter, compared with $6.1 million in the third quarter a year ago. Non-interest income was $18.8 million for the nine-month period ended September 30, 2016, compared with $19.6 million for the same period in 2015.
Non-interest expense for the 2016 third quarter was $33.1 million, versus $31.9 million for the same period last year. Non-interest expense for the first nine months of 2016 was $97.7 million, compared with $94.9 million last year.
Net income for the 2016 third quarter was $17.8 million, or $135.90 per diluted share, compared with $16.2 million, or $123.47 per diluted share, in the year-ago period. The Bank's net income for the first nine months of 2016 was $53.8 million, or $410.75 per diluted share, compared with $49.5 million, or $377.99 per diluted share, for the same period in 2015.
Balance Sheet
At September 30, 2016, net loans totaled $3.37 billion, compared with $3.22 billion at December 31, 2015. The Bank's deposits totaled $5.10 billion at the end of the 2016 third quarter, compared with $4.69 billion at December 31, 2015. Non-interest bearing deposits represented 38.5% of total deposits at September 30, 2016, versus 38.9% of total deposits at December 31, 2015. Total assets increased to $6.63 billion at the close of the 2016 third quarter, compared with $6.15 billion at the close of the prior year.
At September 30, 2016, Farmers & Merchants Bank remained "well-capitalized" under all regulatory categories, with a total risk-based capital ratio of 21.11%, a tier 1 risk-based capital ratio of 19.86%, a common equity tier 1 capital ratio of 19.86%, and a tier 1 leverage ratio of 13.81%. The minimum ratios for capital adequacy for a well-capitalized bank are 10.00%, 8.00%, 6.50% and 5.00%, respectively.
"Farmers & Merchants' solid balance sheet is indicative of characteristics that have embodied the Bank since its inception: liquidity and a conservative lending philosophy," said Daniel Walker, chief executive officer and chairman of the board. "It is these fundamentals that set the foundation for Farmers & Merchants' stellar financial health, as well as the Bank's safety and soundness for every depositor."
About Farmers & Merchants Bank
Founded in Long Beach in 1907 by C.J. Walker, Farmers & Merchants Bank has 24 branches across Orange County, Long Beach and the South Bay. The Bank specializes in commercial and small business banking, business loan programs, home loans, and a robust offering of consumer retail banking products, including checking, savings and youth accounts. Farmers & Merchants Bank is a California state chartered bank with deposits insured by the Federal Deposit Insurance Corporation (Member FDIC) and an Equal Housing Lender. For more information about F&M, please visit the website, www.fmb.com.
FARMERS & MERCHANTS BANK OF LONG BEACH | |||||||||||||||||||||
Income Statements (Unaudited) | |||||||||||||||||||||
(In thousands except per share data) | |||||||||||||||||||||
Three Months Ended Sept 30, | Nine Months Ended Sept 30, | ||||||||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||||||||
Interest and dividend income: | |||||||||||||||||||||
Loans | $ | 40,804 | $ | 37,048 | $ | 121,648 | $ | 111,331 | |||||||||||||
Investment securities | 14,103 | 13,294 | 42,827 | 38,895 | |||||||||||||||||
Investments in FHLB and FRB stock | 445 | 537 | 1,277 | 2,416 | |||||||||||||||||
Interest-bearing deposits in financial institutions | 370 | 163 | 697 | 317 | |||||||||||||||||
Total interest and dividend income | 55,722 | 51,042 | 166,449 | 152,959 | |||||||||||||||||
Interest expense: | |||||||||||||||||||||
Deposits | 2,178 | 1,681 | 6,162 | 4,636 | |||||||||||||||||
Securities sold under repurchase agreements | 492 | 305 | 1,400 | 849 | |||||||||||||||||
Other borrowings | - | - | - | 6 | |||||||||||||||||
Total interest expense | 2,670 | 1,986 | 7,562 | 5,491 | |||||||||||||||||
Net interest income | 53,052 | 49,056 | 158,887 | 147,468 | |||||||||||||||||
Provision for loan losses | - | - | - | - | |||||||||||||||||
Net interest income after provision for loan losses | 53,052 | 49,056 | 158,887 | 147,468 | |||||||||||||||||
Non-interest income: | |||||||||||||||||||||
Service charges on deposit accounts | 1,004 | 1,029 | 2,977 | 3,037 | |||||||||||||||||
Other real estate owned income | 1 | 42 | 17 | 1,414 | |||||||||||||||||
Merchant bankcard income | 2,726 | 2,608 | 7,665 | 7,391 | |||||||||||||||||
Other income | 2,764 | 2,425 | 8,148 | 7,774 | |||||||||||||||||
Total non-interest income | 6,495 | 6,104 | 18,807 | 19,616 | |||||||||||||||||
Non-interest expense: | |||||||||||||||||||||
Salaries and employee benefits | 18,348 | 18,095 | 56,639 | 54,614 | |||||||||||||||||
FDIC and other insurance expense | 618 | 826 | 2,343 | 2,398 | |||||||||||||||||
Occupancy expense | 2,352 | 2,286 | 6,772 | 6,361 | |||||||||||||||||
Software and equipment expense | 1,811 | 1,790 | 5,409 | 5,255 | |||||||||||||||||
Other real estate owned expense | 69 | 2 | (58 | ) | 112 | ||||||||||||||||
Amortization of public welfare investments | 2,117 | 2,117 | 6,351 | 6,351 | |||||||||||||||||
Merchant bankcard expense | 2,087 | 2,080 | 5,801 | 6,014 | |||||||||||||||||
Professional and legal services | 1,418 | 1,079 | 3,640 | 2,969 | |||||||||||||||||
Marketing expense | 1,816 | 1,864 | 4,596 | 4,484 | |||||||||||||||||
Other expense | 2,477 | 1,756 | 6,233 | 6,339 | |||||||||||||||||
Total non-interest expense | 33,113 | 31,895 | 97,726 | 94,897 | |||||||||||||||||
Income before income tax expense | 26,434 | 23,265 | 79,968 | 72,187 | |||||||||||||||||
Income tax expense | 8,641 | 7,100 | 26,190 | 22,698 | |||||||||||||||||
Net income | $ | 17,793 | $ | 16,165 | $ | 53,778 | $ | 49,489 | |||||||||||||
Basic and diluted earnings per common share | $ | 135.90 | $ | 123.47 | $ | 410.75 | $ | 377.99 | |||||||||||||
FARMERS & MERCHANTS BANK OF LONG BEACH | ||||||||||||||||
Balance Sheets (Unaudited) | ||||||||||||||||
(In thousands except share and per share data) | ||||||||||||||||
Sept. 30, 2016 | Dec. 31, 2015 | |||||||||||||||
Assets | ||||||||||||||||
Cash and due from banks: | ||||||||||||||||
Noninterest-bearing balances | $ | 58,008 | $ | 64,742 | ||||||||||||
Interest-bearing balances | 255,364 | 103,278 | ||||||||||||||
Total cash and due from banks | 313,372 | 168,020 | ||||||||||||||
Securities available-for-sale, at fair value | 187,810 | 206,649 | ||||||||||||||
Securities held-to-maturity, at amortized cost | 2,559,270 | 2,363,383 | ||||||||||||||
Loans held for sale | 8,788 | 3,168 | ||||||||||||||
Gross loans | 3,432,617 | 3,278,852 | ||||||||||||||
Allowance for loan losses | (56,844 | ) | (56,670 | ) | ||||||||||||
Unamortized deferred loan fees, net | (4,774 | ) | (4,139 | ) | ||||||||||||
Loans, net | 3,370,999 | 3,218,043 | ||||||||||||||
Other real estate owned, net | 791 | 1,351 | ||||||||||||||
Investments in FHLB and FRB stock, at cost | 20,690 | 20,690 | ||||||||||||||
Public welfare investments | 26,149 | 34,499 | ||||||||||||||
Bank premises and equipment, net | 87,581 | 86,781 | ||||||||||||||
Deferred tax assets, net | 28,377 | 27,892 | ||||||||||||||
Other assets | 24,096 | 23,124 | ||||||||||||||
Total assets | $ | 6,627,923 | $ | 6,153,600 | ||||||||||||
Liabilities and Stockholders' Equity | ||||||||||||||||
Liabilities: | ||||||||||||||||
Deposits: | ||||||||||||||||
Noninterest-bearing demand deposits | $ | 1,964,744 | $ | 1,824,516 | ||||||||||||
Interest-bearing demand deposits | 821,243 | 645,125 | ||||||||||||||
Savings and money market savings | 1,459,556 | 1,376,920 | ||||||||||||||
Time deposits | 858,323 | 843,405 | ||||||||||||||
Total deposits | 5,103,866 | 4,689,966 | ||||||||||||||
Securities sold under repurchase agreements | 594,253 | 572,915 | ||||||||||||||
Other liabilities | 29,664 | 35,388 | ||||||||||||||
Total liabilities | 5,727,783 | 5,298,269 | ||||||||||||||
Stockholders' Equity: | ||||||||||||||||
Common Stock, par value $20; authorized 250,000 shares; issued and outstanding 130,928 shares | 2,619 | 2,619 | ||||||||||||||
Additional paid-in capital | 112,044 | 112,044 | ||||||||||||||
Retained earnings | 784,003 | 739,259 | ||||||||||||||
Accumulated other comprehensive income | 1,474 | 1,409 | ||||||||||||||
Total stockholders' equity | 900,140 | 855,331 | ||||||||||||||
Total liabilities and stockholders' equity | $ | 6,627,923 | $ | 6,153,600 | ||||||||||||
Source URL: http://businesswire.com/news/home/20161014005126/en
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