Farmers & Merchants Bancorp, Inc. Reports Record 2022 Second-Quarter and Year-to-Date Financial Results

Rhea-AI Summary

Farmers & Merchants Bancorp (FMAO) reported a notable performance for Q2 2022, achieving a net income of $8.3 million, up 66.0% year-over-year. Earnings per share rose to $0.63 from $0.44. Total loans reached $2.035 billion, a 9.6% increase from the prior year, supported by organic growth of 19.9%. Total assets increased 23.4% to $2.675 billion, while deposits grew 20.0% year-over-year. The efficiency ratio improved to 50.17%, and the company maintained strong asset quality with nonperforming loans at 0.26%.

Positive

• Net income increased 66.0% to $8.3 million.
• Earnings per share rose to $0.63 from $0.44.
• Total loans reached a record $2.035 billion, up 9.6%.
• Deposits grew by 20.0% to $2.224 billion.
• Efficiency ratio improved to 50.17%.
• Nonperforming loans decreased to 0.26% of total loans.

Negative

• Average shares outstanding rose by 16.8%, potentially diluting existing shareholder value.

ARCHBOLD, Ohio, July 21, 2022 (GLOBE NEWSWIRE) -- Farmers & Merchants Bancorp, Inc. (Nasdaq: FMAO) today reported financial results for the 2022 second quarter and year-to-date June 30, 2022.

2022 Second Quarter Financial and Operating Highlights (on a year-over-year basis unless noted):

• Net income increased 66.0% to a quarterly record of $8.3 million, from $5.0 million
• Earnings increased 43.2% to $0.63 per basic and diluted share, from $0.44 per basic and diluted share
• Average shares outstanding increased 16.8% as a result of the Perpetual Federal Savings Bank Acquisition
• Efficiency rate improved to 50.17%
• Organic loan growth of 19.9%, excluding PPP loans and loan balances at time of acquisitions
• Total loans were a record of $2.035 billion and increased 9.6% from $1.857 billion at December 31, 2021
• Total assets increased 23.4% to $2.675 billion
• Deposits increased 20.0% to $2.224 billion
• Strong asset quality continues as nonperforming loans declined 25.4% to $5.2 million, or 0.26% of total loans
• Net charge-offs to average loans were 0.00%, the fifth consecutive quarter at or below 0.00%
• Return on average equity, increased to 11.66% from 8.00%
• Return on average tangible equity, based on regulatory calculations, increased to 14.72% from 10.26% on a year-over-year basis

Lars B. Eller, President and Chief Executive Officer, stated, “Our record second quarter financial and operating performance reflects the benefits of our organic and acquisition growth strategies, excellent asset quality, and focus on controlling expenses and driving efficiencies. The growth we are experiencing across our Ohio, Indiana and Michigan markets is encouraging, which we believe is a result of our desire to help our retail, commercial and agricultural customers realize their best lives. Loans increased organically by $237.1 million, or 19.9% on a year-over-year basis and are up 9.6% from December 31, 2021.”  

Mr. Eller continued, “In April 2022, we formally honored F&M’s 125^th anniversary, which included activities that recognized the efforts and support of our communities, customers, employees, and shareholders. We are looking forward to building a sustainable business for the next 125 years by investing in our team, innovating our organization, providing our local communities with best-in-class service, and expanding our franchise to new markets. In June 2022, we restructured our leadership team, and added new capabilities and functions that will help us manage and lead a larger organization. We also continue to pursue opportunities for de novo growth. Expansion plans underway include new full-service offices that are expected to open over the next 12 months in Fort Wayne, Indiana, and Toledo, Ohio as well as an office relocation in Auburn, Indiana.”

Income Statement
Net income for the 2022 second quarter ended June 30, 2022, was $8.3 million, compared to $5.0 million for the same period last year. Net income per basic and diluted share for the 2022 second quarter was $0.63, compared to $0.44 for the same period last year. Net income for the 2022 first half ended June 30, 2022, was $16.4 million, compared to $9.9 million for the same period last year. Net income per basic and diluted share for the 2022 first half was $1.25, compared to $0.88 for the same period last year.

Profitability is benefitting from F&M’s larger scale, strong asset quality, and prudent expense management. The Company’s efficiency ratio improved to 50.17% during the 2022 second quarter. Strong profitability also drove higher returns, and ROAA, ROAE, and ROATCE all expanded on a year-over-year basis.

Deposits
At June 30, 2022, total deposits were $2.22 billion, an increase of 20.0% from June 30, 2021, and an increase of 1.4% from December 31, 2021. F&M continues to see growing customer preferences to more stable and secure saving instruments as deposits have increased since the COVID-19 crisis began. The Company’s cost of interest-bearing liabilities was 0.45% for the quarter ended June 30, 2022, compared to 0.44% for the quarter ended June 30, 2021, and 0.51% for the quarter ended December 31, 2021.  

Loan Portfolio and Asset Quality
Total loans, net at June 30, 2022, increased 39.5%, or by $576.4 million to $2.03 billion, compared to $1.46 billion at June 30, 2021, and up from $1.84 billion at December 31, 2021. The year-over-year improvement resulted primarily from the contribution of continued organic loan growth and the completion of both the Perpetual Federal Savings Bank, Inc. and Ossian Financial Services, Inc. acquisitions.

Loans increased 19.9% organically from the same period a year ago when not including the Perpetual acquisition, and the impact of PPP loans. During the 2022 second quarter, the Company processed $455,000 of PPP loan forgiveness and principal payments received. At June 30, 2022, there were only $8,000 of PPP loans within F&M’s loan portfolio.

F&M continues to closely monitor its loan portfolio with a particular emphasis on higher risk sectors. Nonperforming loans were $5.2 million, or 0.26% of total loans at June 30, 2022, compared to $7.0 million, or 0.48% at June 30, 2021. Due to loan growth, F&M continues to prudently fund its allowance for loan and lease losses which has increased 22.1% on a year-over-year basis. At June 30, 2022, the Company’s allowance for loan and lease losses to nonperforming loans was 351.44%, compared to 214.58% at June 30, 2021.

Mr. Eller concluded, “While economic uncertainty has increased throughout 2022, we are committed to pursuing our long-term strategic growth initiatives, helping our customers and communities, and returning additional capital to our shareholders. We are also focused on successfully closing and integrating the Peoples-Sidney Financial Corporation acquisition, which will add $132.7 million in total assets to F&M and expand F&M’s community banking franchise into compelling markets throughout Shelby County Ohio. As a result, we believe 2022 will be another record year of earnings and growth for F&M.”

Stockholders’ Equity and Dividends
Total stockholders’ equity increased 12.1% to $280.9 million at June 30, 2022, from $250.6 million at June 30, 2021. At June 30, 2022, the Company had a Tier 1 leverage ratio of 11.1%, compared to 8.78% at June 30, 2021.

Tangible stockholders’ equity on a regulatory basis increased to $227.7 million at June 30, 2022, compared to $189.6 million at June 30, 2021. On a per share basis, tangible stockholders’ equity at June 30, 2022, was $17.43 per share, compared to $16.94 per share at June 30, 2021.

For the six months ended June 30, 2022, the Company has declared cash dividends of $0.3925 per share, which is a 15.4% increase over the 2021 six-month declared dividend payment. Dividends declared for the 2022 six months included a special one-time cash dividend of $0.0125 to honor F&M’s 125th anniversary.   F&M is committed to returning capital to shareholders and has increased the annual cash dividend for over 27 consecutive years. For the six months ended June 30, 2022, the dividend payout ratio was 30.08% compared to 38.18% for the same period last year.

About Farmers & Merchants State Bank:
The Farmers & Merchants State Bank is a local independent community bank that has been serving Northwest Ohio and Northeast Indiana since 1897. The Farmers & Merchants State Bank provides commercial banking, retail banking and other financial services. Our locations are in Champaign, Fulton, Defiance, Hancock, Henry, Lucas, Williams, and Wood counties in Western Ohio. In Northeast Indiana, we have offices located in Adams, Allen, DeKalb, Jay, Steuben and Wells counties, and we have Loan Production Offices in West Bloomfield, Michigan; Muncie, Indiana; and Bryan and Oxford, 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																		Six Months Ended
	June 30, 2022				March 31, 2022				December 31, 2021				September 30, 2021			June 30, 2021			June 30, 2022				June 30, 2021
Interest Income
Loans, including fees	$	22,388			$	20,455			$	21,008			$	18,766		$	16,259		$	42,843			$	31,871
Debt securities:
U.S. Treasury and government agencies		1,035				1,023				964				924			857			2,058				1,608
Municipalities		322				300				289				284			289			622				597
Dividends		57				42				49				44			31			99				81
Federal funds sold		9				10				10				10			6			19				11
Other.		100				69				103				94			88			169				127
Total interest income		23,911				21,899				22,423				20,122			17,530			45,810				34,295
Interest Expense
Deposits		1,379				1,360				1,581				1,221			1,276			2,739				2,616
Federal funds purchased and securities sold under agreements to repurchase		166				152				155				165			163			318				329
Borrowed funds		218				335				361				87			115			553				337
Subordinated notes		284				269				291				199			-			553				-
Total interest expense		2,047				2,116				2,388				1,672			1,554			4,163				3,282
Net Interest Income - Before Provision for Loan Losses		21,864				19,783				20,035				18,450			15,976			41,647				31,013
Provision for Loan Losses		1,628				580				444				659			641			2,208				2,341
Net Interest Income After Provision For Loan Losses		20,236				19,203				19,591				17,791			15,335			39,439				28,672
Noninterest Income
Customer service fees		2,148				2,648				2,417				2,242			2,198			4,796				5,012
Other service charges and fees		1,008				998				1,026				1,010			874			2,006				1,712
Net gain on sale of loans		164				697				1,074				822			955			861				2,001
Net gain on sale of available-for-sale securities		-				-				-				-			-			-				293
Total noninterest income		3,320				4,343				4,517				4,074			4,027			7,663				9,018
Noninterest Expense
Salaries and wages		5,366				5,502				5,761				5,442			4,591			10,868				8,981
Employee benefits		1,546				2,054				1,792				1,621			1,915			3,600				3,909
Net occupancy expense		522				598				532				529			546			1,120				1,123
Furniture and equipment		1,008				1,056				782				903			848			2,064				1,639
Data processing		654				604				1,020				1,548			428			1,258				933
Franchise taxes		757				418				361				372			294			1,175				740
ATM expense		544				532				478				460			459			1,076				908
Advertising		300				237				431				439			331			537				566
Net (gain) loss on sale of other assets owned		(266	)			(5	)			13				219			227			(271	)			202
FDIC assessment		270				114				265				296			276			384				512
Mortgage servicing rights amortization		59				26				266				285			524			85				1,029
Consulting fees		233				178				761				256			394			411				617
Other general and administrative		2,242				2,179				1,964				1,951			2,227			4,421				4,260
Total noninterest expense		13,235				13,493				14,426				14,321			13,060			26,728				25,419
Income Before Income Taxes		10,321				10,053				9,682				7,544			6,302			20,374				12,271
Income Taxes		2,050				1,951				1,999				1,624			1,319			4,001				2,379
Net Income		8,271				8,102				7,683				5,920			4,983			16,373				9,892
Other Comprehensive Income (Loss) (Net of Tax):
Net unrealized gain (loss) on available-for-sale securities		(14,602	)			(20,939	)			(5,170	)			173			786			(35,541	)			(5,951	)
Reclassification adjustment for realized gain on sale of available-for-sale securities		-				-				-				-			-			-				(293	)
Net unrealized gain (loss) on available-for-sale securities		(14,602	)			(20,939	)			(5,170	)			173			786			(35,541	)			(6,244	)
Tax expense (benefit)		(3,067	)			(4,397	)			(1,085	)			36			165			(7,464	)			(1,311	)
Other comprehensive income (loss)		(11,535	)			(16,542	)			(4,085	)			137			621			(28,077	)			(4,933	)
Comprehensive Income (Loss)	$	(3,264	)		$	(8,440	)		$	3,598			$	6,057		$	5,604		$	(11,704	)		$	4,959
Basic and Diluted Earnings Per Share	$	0.63			$	0.62			$	0.59			$	0.53		$	0.44		$	1.25			$	0.88
Dividends Declared	$	0.2025			$	0.1900			$	0.1900			$	0.1800		$	0.1700		$	0.3925			$	0.3400

FARMERS & MERCHANTS BANCORP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited) (in thousands of dollars, except share data)
	June 30, 2022				March 31, 2022				December 31, 2021				September 30, 2021				June 30, 2021
	(Unaudited)				(Unaudited)								(Unaudited)				(Unaudited)
Assets
Cash and due from banks	$	69,955			$	94,118			$	135,485			$	112,875			$	93,636
Federal funds sold		1,484				45,404				45,338				45,203				57,483
Total cash and cash equivalents		71,439				139,522				180,823				158,078				151,119
Interest-bearing time deposits		6,684				8,677				10,913				14,622				18,597
Securities - available-for-sale		399,687				413,996				429,931				426,717				407,500
Other securities, at cost		8,735				8,568				8,162				4,905				6,419
Loans held for sale		4,230				6,060				7,714				3,735				8,041
Loans, net		2,016,394				1,945,449				1,841,177				1,479,864				1,443,336
Premises and equipment		26,492				26,653				26,913				26,476				26,915
Goodwill		80,434				80,434				80,434				55,214				56,066
Mortgage servicing rights		3,426				3,336				3,157				3,097				3,146
Other real estate owned		-				-				159				167				198
Bank owned life insurance		27,874				27,715				27,558				27,397				27,218
Other assets		29,321				25,735				21,359				18,711				18,310
Total Assets	$	2,674,716			$	2,686,145			$	2,638,300			$	2,218,983			$	2,166,865
Liabilities and Stockholders' Equity
Liabilities
Deposits
Noninterest-bearing	$	503,395			$	497,249			$	473,689			$	438,076			$	443,863
Interest-bearing
NOW accounts		678,552				681,975				650,466				646,237				652,078
Savings		617,850				626,787				597,828				529,532				501,687
Time		424,249				447,586				471,479				252,383				256,445
Total deposits		2,224,046				2,253,597				2,193,462				1,866,228				1,854,073
Federal funds purchased and
securities sold under agreements to repurchase		71,944				31,680				29,268				29,601				29,882
Federal Home Loan Bank (FHLB) advances		42,635				22,656				24,065				17,868				17,868
Other borrowings		-				40,000				40,000				-				-
Subordinated notes, net of unamortized issuance costs		34,528				34,499				34,471				34,441				-
Dividend payable		2,626				2,462				2,461				2,002				1,888
Accrued expenses and other liabilities		18,064				14,773				17,406				14,097				12,569
Total liabilities		2,393,843				2,399,667				2,341,133				1,964,237				1,916,280
Commitments and Contingencies
Stockholders' Equity
Common stock - No par value 20,000,000 shares authorized; issued and
outstanding 14,063,999 shares 6/30/22 and 12/31/21		123,145				122,886				122,674				81,382				82,259
Treasury stock - 998,174 shares 6/30/22, 997,766 shares 12/31/21		(11,822	)			(11,739	)			(11,724	)			(11,718	)			(12,172	)
Retained earnings		200,811				195,057				189,401				184,181				179,734
Accumulated other comprehensive income (loss)		(31,261	)			(19,726	)			(3,184	)			901				764
Total stockholders' equity		280,873				286,478				297,167				254,746				250,585
Total Liabilities and Stockholders' Equity	$	2,674,716			$	2,686,145			$	2,638,300			$	2,218,983			$	2,166,865

FARMERS & MERCHANTS BANCORP, INC. AND SUBSIDIARIES
SELECT FINANCIAL DATA
		For the Three Months Ended																				For the Six Months Ended
Selected financial data		June 30, 2022				March 31, 2022				December 31, 2021				September 30, 2021				June 30, 2021				June 30, 2022			June 30, 2021
Return on average assets			1.23	%			1.21	%			1.17	%			1.12	%			0.90	%		1.22	%		0.98	%
Return on average equity			11.66	%			11.00	%			10.94	%			9.32	%			8.00	%		11.32	%		7.94	%
Yield on earning assets			3.47	%			3.47	%			3.59	%			3.85	%			3.53	%		3.79	%		3.61	%
Cost of interest bearing liabilities			0.45	%			0.45	%			0.51	%			0.45	%			0.44	%		0.44	%		0.48	%
Net interest spread			3.02	%			3.02	%			3.08	%			3.40	%			3.09	%		3.35	%		3.13	%
Net interest margin			3.14	%			3.14	%			3.21	%			3.53	%			3.21	%		3.47	%		3.27	%
Efficiency			50.17	%			55.44	%			58.76	%			63.50	%			64.98	%		57.90	%		63.72	%
Dividend payout ratio			30.02	%			30.64	%			32.03	%			33.81	%			37.89	%		30.08	%		38.18	%
Tangible book value per share (1)		$	17.43			$	16.96			$	16.49			$	17.33			$	16.94
Tier 1 capital to average assets			8.75	%			8.51	%			8.47	%			9.45	%			8.78	%
Average Shares Outstanding			13,065,975				13,066,272				13,046,299				11,209,732				11,191,043			13,066,123			11,194,011
Loans		June 30, 2022				March 31, 2022				December 31, 2021				September 30, 2021				June 30, 2021
(Dollar amounts in thousands)
Commercial real estate		$	979,176			$	910,839			$	848,477			$	728,852			$	691,122
Agricultural real estate			199,972				196,223				198,343				179,374				189,742
Consumer real estate			410,450				410,120				395,873				202,454				194,715
Commercial and industrial			232,975				216,918				208,270				194,767				216,609
Agricultural			127,143				140,709				118,368				105,580				100,756
Consumer			55,411				57,521				57,737				55,521				56,427
Other			31,243				31,573				32,089				31,096				13,549
Less: Net deferred loan fees and costs			(1,552	)			(1,683	)			(1,738	)			(2,082	)			(4,497	)
Total loans,net		$	2,034,818			$	1,962,220			$	1,857,419			$	1,495,562			$	1,458,423
Asset quality data		June 30, 2022				March 31, 2022				December 31, 2021				September 30, 2021				June 30, 2021
(Dollar amounts in thousands)
Nonaccrual loans		$	5,247			$	8,581			$	8,076			$	6,248			$	7,031
Troubled debt restructuring		$	2,748			$	7,268			$	7,614			$	6,035			$	5,492
90 day past due and accruing		$	-			$	-			$	-			$	-			$	-
Nonperforming loans		$	5,247			$	8,581			$	8,076			$	6,248			$	7,031
Other real estate owned		$	-			$	-			$	159			$	167			$	198
Nonperforming assets		$	5,247			$	8,581			$	8,235			$	6,415			$	7,229
(Dollar amounts in thousands)
Allowance for loan and lease losses		$	18,424			$	16,771			$	16,242			$	15,698			$	15,087
Allowance for loan and lease losses/total loans			0.91	%			0.85	%			0.87	%			1.05	%			1.03	%
Net charge-offs:
Quarter-to-date		$	(25	)		$	51			$	(101	)		$	48			$	(21	)
Year-to-date		$	26			$	51			$	874			$	974			$	926
Net charge-offs to average loans
Quarter-to-date			0.00	%			0.00	%			-0.01	%			0.00	%			0.00	%
Year-to-date			0.00	%			0.00	%			0.06	%			0.07	%			0.07	%
Nonperforming loans/total loans			0.26	%			0.44	%			0.43	%			0.42	%			0.48	%
Allowance for loan and lease losses/nonperforming loans			351.44	%			198.29	%			201.11	%			251.26	%			214.58	%
(1) Tangible Equity = Stockholder Equity less goodwill and other intangibles (core deposit intangible, mortgage servicing rights and unrealized gain/loss on securities)

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
	June 30, 2022									June 30, 2021
Interest Earning Assets:	Average Balance			Interest/Dividends			Annualized Yield/Rate			Average Balance			Interest/Dividends			Annualized Yield/Rate
Loans	$	1,999,357		$	22,388		4.48	%		$	1,419,531		$	16,259		4.58	%
Taxable investment securities		422,482			1,344		1.27	%			367,249			1,100		1.20	%
Tax-exempt investment securities		21,649			70		1.64	%			17,497			77		2.23	%
Fed funds sold & other		81,091			109		0.54	%			187,583			94		0.20	%
Total Interest Earning Assets		2,524,579		$	23,911		3.79	%			1,991,860		$	17,530		3.53	%
Nonearning Assets		161,031									228,036
Total Assets	$	2,685,610								$	2,219,896
Interest Bearing Liabilities:
Savings deposits	$	1,312,444		$	777		0.24	%		$	1,123,157		$	566		0.20	%
Other time deposits		435,091			602		0.55	%			250,277			710		1.13	%
Other borrowed money		39,172			218		2.23	%			17,859			115		2.58	%
Fed funds purchased & securities
sold under agreement to repurch.		35,260			166		1.88	%			29,980			163		2.17	%
Subordinated notes		34,509			284		3.29	%			-			-		0.00	%
Total Interest Bearing Liabilities	$	1,856,476		$	2,047		0.44	%		$	1,421,273		$	1,554		0.44	%
Noninterest Bearing Liabilities		545,439									549,610
Stockholders' Equity	$	283,695								$	249,013
Net Interest Income and Interest Rate Spread				$	21,864		3.35	%					$	15,976		3.09	%
Net Interest Margin							3.47	%								3.21	%
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 Six Months Ended									For the Six Months Ended
	June 30, 2022									June 30, 2021
Interest Earning Assets:	Average Balance			Interest/Dividends			Annualized Yield/Rate			Average Balance			Interest/Dividends			Annualized Yield/Rate
Loans	$	1,953,671		$	42,843		4.39	%		$	1,374,302		$	31,871		4.64	%
Taxable investment securities		426,189			2,639		1.24	%			345,893			2,109		1.22	%
Tax-exempt investment securities		20,119			140		1.76	%			18,936			177		2.37	%
Fed funds sold & other		124,050			188		0.30	%			162,646			138		0.17	%
Total Interest Earning Assets		2,524,029		$	45,810		3.63	%			1,901,777		$	34,295		3.61	%
Nonearning Assets		162,949									126,533
Total Assets	$	2,686,978								$	2,028,310
Interest Bearing Liabilities:
Savings deposits	$	1,302,005		$	1,365		0.21	%		$	1,069,179		$	1,140		0.21	%
Other time deposits		447,471			1,374		0.61	%			246,155			1,476		1.20	%
Other borrowed money		51,180			553		2.16	%			17,854			337		3.78	%
Fed funds purchased & securities
sold under agreement to repurch.		32,182			318		1.98	%			30,095			329		2.19	%
Subordinated notes		34,495			553		3.12	%			-			-		0.00	%
Total Interest Bearing Liabilities	$	1,867,333		$	4,163		0.44	%		$	1,363,283		$	3,282		0.48	%
Noninterest Bearing Liabilities		530,478									415,722
Stockholders' Equity	$	289,167								$	249,305
Net Interest Income and Interest Rate Spread				$	41,647		3.19	%					$	31,013		3.13	%
Net Interest Margin							3.30	%								3.27	%
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
NON-GAAP RECONCILIATION OF TANGIBLE BOOK VALUE
		Actual End of Period								Regulatory End of Period
Non-GAAP Reconciliation of Tangible Book Value		Year to Date								Year to Date
		June 30, 2022				June 30, 2021				June 30, 2022				June 30, 2021
Shares Outstanding			13,065,825				11,189,052				13,065,825				11,189,052
Tangible Equity
Equity		$	280,872			$	250,585			$	280,872			$	250,585
Goodwill			80,434				56,066				80,434				56,066
Other Intangible			3,974				4,200				3,974				4,200
Comprehensive Adjustment*			-				-				31,261				(764	)
Tangible Equity		$	196,464			$	190,319			$	227,725			$	189,555
Shares Outstanding			13,066				11,189				13,066				11,189
Tangible Book Equity per Share		$	15.04			$	17.01			$	17.43			$	16.94
		Actual Average								Regulatory Average
		Year to Date								Year to Date
		June 30, 2022				June 30, 2021				June 30, 2022				June 30, 2021
Net Income		$	16,373			$	9,892			$	16,373			$	9,892
Acquisition Costs - Tax Adjusted			115				982				115				982
Average Shares Outstanding			13,066,123				11,194,011				13,066,123				11,194,011
Average Tangible Equity
Average Equity		$	289,167			$	249,305			$	289,167			$	249,305
Average Goodwill			80,434				50,191				80,434				50,191
Average Other Intangible			4,235				3,764				4,235				3,764
Average Comprehensive Adjustment*			-				-				16,893				(2,548	)
Average Tangible Equity		$	204,498			$	195,350			$	221,391			$	192,803
Average Shares Outstanding			13,066				11,194				13,066				11,194
Average Tangible Book Equity per Share		$	15.65			$	17.45			$	16.94			$	17.22
Return on Average Tangible Equity			16.01	%			10.13	%			14.79	%			10.26	%
Return on Average Tangible Equity w/o Acquisition			16.12	%			11.13	%			14.89	%			11.28	%
*The Bank has adopted the Accumulated Other Comprehensive Income (AOCI) opt out election which removed AOCI from the calculation of tangible equity for regulatory purposes.

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

FAQ

What are the latest earnings results for Farmers & Merchants Bancorp (FMAO)?

For Q2 2022, FMAO reported a net income of $8.3 million, or $0.63 per share.

How much did total loans increase for FMAO in Q2 2022?

Total loans increased to $2.035 billion, a 9.6% rise from the previous year.

What is the current efficiency ratio for FMAO?

The efficiency ratio for Q2 2022 improved to 50.17%.

What growth did FMAO experience in deposits for Q2 2022?

Deposits grew by 20.0% to $2.224 billion year-over-year.

What is the status of FMAO's nonperforming loans?

Nonperforming loans decreased to 0.26% of total loans as of June 30, 2022.