FARMERS & MER BANCSHARES - FMFG STOCK NEWS

Farmers and Merchants Bancshares, Inc. (FMFG) reported net income of $3,421,623, or $1.09 per share, for the nine months ended September 30, 2024, compared to $5,003,107, or $1.63 per share, for the same period in 2023. The decline in net income was primarily due to higher interest expenses resulting from Federal Reserve rate increases. Key financial metrics include:

- Return on average equity: 8.53% (down from 13.45%)
- Return on average assets: 0.57% (down from 0.91%)
- Loan growth: $49 million (12.5% annualized growth rate)
- Net interest margin: 2.67% (down from 3.04%)
- Total assets: $818 million (up from $800 million)
- Loans: $572 million (up from $523 million)
- Deposits: $674 million (down from $681 million)
- Book value per share: $18.81 (up from $16.74)

The company's CEO, Gary A. Harris, highlighted strong loan growth and asset quality, while noting ongoing challenges with net interest margin and the impact of a core system conversion scheduled for October 28, 2024.

Farmers and Merchants Bancshares, Inc. (FMFG) has adopted a duration stockholder rights plan to protect the company and its stockholders' interests. This decision follows a Schedule 13D/A filing by an Investor Group owning approximately 10.1% of the company's stock, who intend to acquire 24.9% and nominate board candidates. The Rights Plan, effective immediately with a one-year expiration, aims to:

• Ensure long-term value for stockholders
• Prevent rapid accumulation of controlling positions
• Guard against abusive tactics
• Allow directors to fulfill their duties

The plan issues one right per outstanding share, becoming exercisable if an entity acquires 11% or more of the stock without board approval.

Farmers and Merchants Bancshares, Inc. (FMFG) reported net income of $2,298,496, or $0.74 per share, for the six months ended June 30, 2024, compared to $3,570,968, or $1.16 per share, for the same period in 2023. The decline in net income was primarily due to higher interest expenses resulting from Federal Reserve rate increases. The company's return on average equity decreased to 8.81% from 14.34%, and return on average assets fell to 0.58% from 0.99%. Net interest income decreased by $620,275, with the net interest margin declining to 2.70% from 3.09%. Despite challenges, loan portfolio growth was significant, and the company maintains a strong liquidity position with access to approximately $343 million at June 30, 2024.

Farmers and Merchants Bancshares, the parent company of Farmers and Merchants Bank, declared a cash dividend of $.33 per share on May 20, 2024. This dividend will be paid on June 21, 2024, to shareholders recorded by June 3, 2024. The dividend yields 4.1% annually based on the current market value of $16.25 per share. For more details, visit the investor relations section on their website.

Farmers and Merchants Bancshares, Inc. reported earnings of $1,219,987 or $0.39 per share for the three months ended March 31, 2024. The net income declined from $1,900,851 in the same period in 2023 primarily due to higher interest expenses driven by Federal Reserve rate increases. Return on average equity and assets also decreased. Net interest income was lower due to a decrease in the net interest margin, despite an increase in interest earning assets. Noninterest income and expenses saw changes, with an increase in noninterest income but higher expenses. The company had no provision for credit losses in 2024, unlike the recovery recorded in 2023. Total assets decreased slightly, while loans increased. The book value per share increased, reflective of an unrealized loss on the Bank's AFS investment portfolio. The company remains optimistic about its loan portfolio growth and asset quality despite challenges from higher costs.

Farmers and Merchants Bancshares, Inc. reported a decrease in net income and return on equity and assets for the year ended December 31, 2023, compared to the same period in 2022. The net interest income and noninterest income also decreased, while noninterest expenses and income taxes decreased. Total assets, loans, investments, cash and cash equivalents, and deposits increased. The company's tangible equity and book value per share also increased. The implementation of the new credit loss methodology resulted in an increase in the credit loss reserve on loans, available credit, and held to maturity securities. The company utilized the Federal Reserve Bank’s Bank Term Funding Program and had borrowings outstanding at December 31, 2023. The CEO commented on the challenging year and the impact of the higher interest rate environment.

Farmers and Merchants Bancshares, Inc. (FMB) declared a cash dividend of $.33 per share of common stock on November 20, 2023. The annual dividend has increased for 13 consecutive years, with the 2023 dividend representing a 4.8% increase over the previous year. The dividend of $.66 per share represents a 3.8% yield on the current market value of $17.52 per share. Shareholders of record on December 1, 2023, will receive the dividend on December 15, 2023.

Farmers and Merchants Bancshares reports net income of $5,003,107 for the nine months ended September 30, 2023, compared to $6,075,845 for the same period in 2022. Return on average equity decreases to 13.45% from 15.53%. Net interest income decreases due to higher interest expense on deposits and borrowings. Noninterest income decreases primarily due to a decline in mortgage banking revenue. Total assets, loans, investments in debt securities, and deposits increase. Tangible equity remains unchanged. Book value per share increases to $15.61. The company utilizes the Federal Reserve Bank's Bank Term Funding Program for liquidity.

Robert Pollokoff joins the Boards of Directors of Farmers and Merchants Bancshares, Inc. and its subsidiary, Farmers and Merchants Bank.