Farmers & Merchants Bank of Long Beach Reports 2024 Second Quarter Results
--Board Authorizes Repurchase of Up to an Additional
"F&M’s second quarter performance demonstrated the Bank’s resilience and strategic management of resources amidst the continued challenging external environment for regional banks,” said
“We continue working actively to improve the return on our investments and manage expenses, while meeting increased regulatory demands, since F&M was categorized last year as a regional, versus community, bank. Growth in lower cost deposits will significantly help with the scaling of expenses and paying existing borrowings, and, in turn, enhancing profitability over time. Although the yield on our loan portfolio continues to improve, we find that our HTM (Held-to-Maturity) securities portfolio continues to exert downward pressure on earnings, as is the case with many banks. Fortunately, both categories of F&M investments are of superior quality, posing no risk to capital, and the Bank remains safe and sound.”
Operating Results
For the second quarter of 2024, total interest and dividend income rose to
Total interest expense for the second quarter of 2024 was
Net interest income before provision for credit losses for the second quarter of 2024 was
F&M’s net interest margin was 1.92% for the second quarter of 2024, versus 2.19% in the second quarter of 2023. Net interest margin was 1.92% for the six months ended
The Bank recorded a recapture of provision for credit losses of
Non-interest income was
Total non-interest expense for the second quarter of 2024 was
Net income for the second quarter of 2024 was
Balance Sheet
Gross loans were
The Bank’s total deposits were
Total assets were
Capital
Capital ratios are the foundation of safety in all banks, and F&M continues to exceed national banks and peer banks in this area. All of Farmers & Merchants Bank’s capital ratios exceeded regulatory capital requirements to meet the definition of a “well-capitalized” financial institution. The Bank’s total risk-based capital ratio was 18.26%; its tier 1 risk-based capital ratio was 17.00%, with a common equity tier 1 capital ratio of 17.00%, and a tier 1 leverage ratio of 11.21%, as of
Stock Repurchase Program
During the first half of 2024, the Bank repurchased 1,824 shares of its common stock on the open market at an average repurchase price of
As noted above, the Board authorized the repurchase of up to an additional
About
Founded in
Income Statements (Unaudited) (In thousands, except per share data) |
||||||||||||||||
Three Months Ended |
Six Months Ended |
|||||||||||||||
|
2024 |
|
|
2023 |
|
2024 |
|
|
2023 |
|
||||||
Interest and dividend income: | ||||||||||||||||
Loans |
$ |
74,025 |
|
$ |
74,632 |
$ |
149,510 |
|
$ |
147,107 |
|
|||||
Investment securities |
|
19,703 |
|
|
22,345 |
|
40,074 |
|
|
45,158 |
|
|||||
Investments in FHLB and FRB stock |
|
460 |
|
|
414 |
|
999 |
|
|
814 |
|
|||||
Interest-bearing deposits in financial institutions |
|
14,475 |
|
|
4,957 |
|
26,716 |
|
|
6,557 |
|
|||||
Total interest and dividend income |
|
108,663 |
|
|
102,348 |
|
217,299 |
|
|
199,636 |
|
|||||
Interest expense: | ||||||||||||||||
Deposits |
|
29,319 |
|
|
19,611 |
|
56,778 |
|
|
33,569 |
|
|||||
Securities sold under repurchase agreements |
|
9,483 |
|
|
7,274 |
|
19,093 |
|
|
13,294 |
|
|||||
Borrowings |
|
12,767 |
|
|
10,390 |
|
26,890 |
|
|
16,881 |
|
|||||
Total interest expense |
|
51,569 |
|
|
37,275 |
|
102,761 |
|
|
63,744 |
|
|||||
Net interest income before provision for credit losses |
|
57,094 |
|
|
65,073 |
|
114,538 |
|
|
135,892 |
|
|||||
Provision for credit losses | ||||||||||||||||
Loans |
|
- |
|
|
- |
|
(1,500 |
) |
|
- |
|
|||||
Investment securities |
|
- |
|
|
- |
|
- |
|
|
100 |
|
|||||
Reserve for unfunded loan commitments |
|
(1,000 |
) |
|
- |
|
(2,000 |
) |
|
(100 |
) |
|||||
Total provision for credit losses |
|
(1,000 |
) |
|
- |
|
(3,500 |
) |
|
- |
|
|||||
Net interest income after provision for credit losses |
|
58,094 |
|
|
65,073 |
|
118,038 |
|
|
135,892 |
|
|||||
Non-interest income: | ||||||||||||||||
Service charges on deposit accounts |
|
1,877 |
|
|
1,810 |
|
3,686 |
|
|
3,354 |
|
|||||
Card income |
|
214 |
|
|
370 |
|
439 |
|
|
600 |
|
|||||
Other income |
|
8,473 |
|
|
2,206 |
|
14,682 |
|
|
4,267 |
|
|||||
Total non-interest income |
|
10,564 |
|
|
4,386 |
|
18,807 |
|
|
8,221 |
|
|||||
Non-interest expense: | ||||||||||||||||
Salaries and employee benefits |
|
30,974 |
|
|
30,915 |
|
61,751 |
|
|
62,708 |
|
|||||
|
|
2,637 |
|
|
1,846 |
|
5,511 |
|
|
3,604 |
|
|||||
Occupancy expense |
|
3,909 |
|
|
3,711 |
|
7,799 |
|
|
7,538 |
|
|||||
Software and equipment expense |
|
4,468 |
|
|
3,803 |
|
8,731 |
|
|
7,663 |
|
|||||
Other real estate owned expense |
|
212 |
|
|
- |
|
249 |
|
|
- |
|
|||||
Professional and legal services |
|
3,102 |
|
|
2,353 |
|
5,597 |
|
|
3,483 |
|
|||||
Marketing expense |
|
919 |
|
|
2,669 |
|
1,957 |
|
|
3,551 |
|
|||||
Other expense |
|
3,533 |
|
|
5,522 |
|
8,240 |
|
|
10,567 |
|
|||||
Total non-interest expense |
|
49,754 |
|
|
50,819 |
|
99,835 |
|
|
99,114 |
|
|||||
Income before income tax expense |
|
18,904 |
|
|
18,640 |
|
37,010 |
|
|
44,999 |
|
|||||
Income tax expense |
|
5,370 |
|
|
491 |
|
10,474 |
|
|
5,227 |
|
|||||
Net income |
$ |
13,534 |
|
$ |
18,149 |
$ |
26,536 |
|
$ |
39,772 |
|
|||||
Basic earnings per common share |
$ |
111.12 |
|
$ |
147.28 |
$ |
217.01 |
|
$ |
322.75 |
|
|||||
Diluted earnings per common share |
$ |
107.86 |
|
$ |
143.69 |
$ |
210.54 |
|
$ |
314.54 |
|
|||||
Basic weighted-average shares outstanding |
|
121,792 |
|
|
123,228 |
|
122,282 |
|
|
123,228 |
|
|||||
Diluted weighted-average shares outstanding |
|
125,481 |
|
|
126,301 |
|
126,038 |
|
|
126,444 |
|
|||||
Balance Sheets (Unaudited) (In thousands, except share and per share data) |
|||||||
|
|
||||||
Assets | |||||||
Cash and due from banks: | |||||||
Noninterest-bearing balances |
$ |
66,258 |
|
$ |
74,595 |
|
|
Interest-bearing balances |
|
1,246,277 |
|
|
548,874 |
|
|
Total cash and due from banks |
|
1,312,535 |
|
|
623,469 |
|
|
Securities available-for-sale, at fair value |
|
98,181 |
|
|
115,883 |
|
|
Securities held-to-maturity, at amortized cost |
|
4,029,122 |
|
|
4,301,060 |
|
|
Loans held for sale |
|
460 |
|
|
- |
|
|
Gross loans |
|
6,506,539 |
|
|
6,756,207 |
|
|
Allowance for loan losses |
|
(97,510 |
) |
|
(97,900 |
) |
|
Unamortized deferred loan fees, net |
|
(9,156 |
) |
|
(11,469 |
) |
|
Loans, net |
|
6,399,873 |
|
|
6,646,838 |
|
|
Other real estate owned, net |
|
2,929 |
|
|
- |
|
|
Investments in FHLB and FRB stock, at cost |
|
22,740 |
|
|
22,798 |
|
|
Bank premises and equipment, net |
|
124,634 |
|
|
125,929 |
|
|
Deferred tax assets, net |
|
44,456 |
|
|
45,723 |
|
|
Other assets |
|
158,152 |
|
|
154,154 |
|
|
Total assets |
$ |
12,193,082 |
|
$ |
12,035,854 |
|
|
Liabilities and Stockholders' Equity | |||||||
Liabilities: | |||||||
Deposits: | |||||||
Noninterest-bearing demand deposits |
$ |
2,820,940 |
|
$ |
2,880,315 |
|
|
Interest-bearing demand deposits |
|
2,267,720 |
|
|
2,069,275 |
|
|
Savings and money market savings |
|
2,675,284 |
|
|
2,661,312 |
|
|
Time deposits |
|
1,049,341 |
|
|
1,059,166 |
|
|
Total deposits |
|
8,813,285 |
|
|
8,670,068 |
|
|
Securities sold under repurchase agreements |
|
926,151 |
|
|
909,376 |
|
|
Borrowings |
|
1,000,000 |
|
|
1,000,000 |
|
|
Other liabilities |
|
92,926 |
|
|
104,965 |
|
|
Total liabilities |
|
10,832,362 |
|
|
10,684,409 |
|
|
Stockholders' Equity: | |||||||
Common Stock, par value |
|
2,479 |
|
|
2,463 |
|
|
Additional paid-in capital |
|
174,863 |
|
|
184,483 |
|
|
Retained earnings |
|
1,189,629 |
|
|
1,169,759 |
|
|
Accumulated other comprehensive loss |
|
(6,251 |
) |
|
(5,260 |
) |
|
Total stockholders' equity |
|
1,360,720 |
|
|
1,351,445 |
|
|
Total liabilities and stockholders' equity |
$ |
12,193,082 |
|
$ |
12,035,854 |
|
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20240718061232/en/
Kevin Tiber
President
562 499-4829
Investor Relations
310-279-5980
investor@pondel.com
Source: