Attached files
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| 8-K - CURRENT REPORT - F&M BANK CORP | fmbm_8k.htm |
Exhibit 99.1
F & M Bank Corp.---News and Financials
F & M BANK CORP. ANNOUNCES SECOND QUARTER EARNINGS AND SECOND
QUARTER DIVIDEND
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CONTACT:
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Carrie Comer, EVP/Chief Financial
Officer
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540-896-8941 or
ccomer@fmbankva.com
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TIMBERVILLE,
VA—July 28, 2020—F & M Bank Corp. (OTCQX: FMBM),
parent company of Farmers & Merchants Bank, announces its
financial results for the second quarter ending June 30, 2020 and
second quarter dividend to shareholders.
As
the global pandemic continues, the company continually assesses our
procedures to maintain the safety of our customers, employees and
community while serving their financial needs. Farmers &
Merchants Bank continues to operate our branches in a drive-thru
only capacity daily, with courier pick up and by appointment lobby
transactions.
As
of June 30, 2020, we had processed 676 Paycheck Protection Program
(PPP) loans for a balance of $59.9 million. These loans are funded
by participation in the Federal Reserve Paycheck Protection Program
Lending Facility. In addition, we have processed 922 individual
loan deferrals. As of June 30, 2020, 155 loans remain in deferral
with a balance of $24.5 million.
Selected
financial highlights for the quarter include:
●
Net
income of $2.63 million.
●
Net
interest margin of 3.55%.
●
Total
deposits increased $87.3 million and $158.2 million, respectively
for the quarter and for the trailing 12 months.
●
Nonperforming
loans decreased to 0.45% of total assets at the end of the quarter
from 0.50% on 3/31/20 and 1.45% on 6/30/2019.
●
Allowance
for loan losses totaled 1.47% of loans held for investment (1.61%
excluding PPP loans).
Mark Hanna, President, commented
“Our
second quarter earnings of $2.63 million is an improvement over the
first quarter which was more heavily weighed down by provision
expenses related to COVID-19. The second quarter also reflects
recognition of $267,000 in Small Business Administration fees
related to PPP loans and recognition of $567,000 for implementation
of a mortgage rate lock derivative associated with our mortgage
company pipeline. Our net interest margin of 3.55% shows a
historical decline but still remains strong in the current
environment. Our balance sheet liquidity has increased
significantly over the last three quarters and we are implementing
strategic solutions to leverage these assets including deploying
$73.5 million into the investment portfolio in the second quarter.
These strategies should improve our net interest margin in the
future”
Mr. Hanna continued, “Nonperforming loans
have improved dramatically over prior year, decreasing $7.2 million
since second quarter of 2019, and also decreasing $1.3 million
since year end 2019”.
On
July 24, 2020 our Board of Directors declared a first quarter
dividend of $.26 per share to common shareholders. Based on our
most recent trade price of $18.50 per share this constitutes a
5.62% yield on an annualized basis. The dividend will be paid on
August 31, 2020, to shareholders of record as of August 14,
2020.”
F
& M Bank Corp. is an independent, locally-owned, financial
holding company, offering a full range of financial services,
through its subsidiary, Farmers & Merchants Bank’s eleven
(as of July 31, 2020) banking offices in Rockingham, Shenandoah,
Page and Augusta Counties, Virginia. The Bank also provides
additional services through a loan production office located in
Penn Laird, VA and through its subsidiaries, F&M Mortgage and
VSTitle, both of which are located in Harrisonburg, VA. Additional
information may be found by contacting us on the internet at
www.fmbankva.com or by calling (540) 896-8941.
This
press release may contain “forward-looking statements”
as defined by federal securities laws, which may involve
significant risks and uncertainties. These statements address
issues that involve risks, uncertainties, estimates and assumptions
made by management, and actual results could differ materially from
the results contemplated by these forward-looking statements.
Factors that could have a material adverse effect on our operations
and future prospects include, but are not limited to, changes in
interest rates, general economic conditions, legislative and
regulatory policies, and a variety of other matters. Other risk
factors are detailed from time to time in our Securities and
Exchange Commission filings. Readers should consider these risks
and uncertainties in evaluating forward-looking statements and
should not place undue reliance on such statements. We undertake no
obligation to update these statements following the date of this
press release.
1
F
& M Bank Corp.
Key
Statistics
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2020
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2019
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Q2
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Q1
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YTD
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Q2
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Q1
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YTD
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Net
Income (000's)
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$2,626
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$1,189
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$3,815
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$1,634
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$1,287
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$2,921
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Net
Income available to Common
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$2,560
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$1,123
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$3,683
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$1,556
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$1,208
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$2,764
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Earnings
per common share - basic
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$0.80
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$0.35
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$1.15
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$0.48
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$0.38
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$0.86
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Earnings
per common share - diluted
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$0.76
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$0.35
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$1.11
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$0.47
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$0.37
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$0.84
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Return
on Average Assets
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1.17%
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0.58%
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1.71%
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0.83%
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0.67%
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0.74%
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Return
on Average Equity
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11.50%
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5.23%
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16.69%
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7.12%
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5.68%
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6.40%
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Dividend
Payout Ratio excluding Special Dividend
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32.50%
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74.29%
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45.22%
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52.08%
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65.79%
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58.14%
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Net
Interest Margin
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3.55%
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3.97%
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3.75%
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4.47%
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4.67%
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4.57%
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Yield
on Average Earning Assets
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4.20%
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4.88%
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4.52%
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5.42%
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5.54%
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5.48%
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Yield
on Average Interest Bearing Liabilities
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0.92%
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1.27%
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1.09%
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1.33%
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1.21%
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1.26%
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Net
Interest Spread
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3.28%
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3.61%
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3.43%
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4.09%
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4.33%
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4.22%
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Provision
for Loan Losses (000's)
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$800
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$1,500
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$2,300
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$1,600
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$1,450
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$3,050
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Net
Charge-offs
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$203
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$453
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$656
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$483
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$1,757
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$2,240
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Net
Charge-offs as a % of Loans
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0.12%
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0.30%
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0.20%
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0.30%
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1.09%
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0.70%
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Non-Performing
Loans (000's)
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$4,465
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$4,168
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$4,465
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$11,688
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$10,587
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$11,688
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Non-Performing
Loans to Total Assets
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0.45%
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0.50%
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0.45%
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1.45%
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1.36%
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1.45%
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Non-Performing
Assets (000's)
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$5,625
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$5,504
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$5,625
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$13,657
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$12,761
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$13,657
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Non-Performing
Assets to Assets
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0.57%
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0.66%
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0.57%
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1.69%
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1.64%
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1.69%
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Efficiency
Ratio
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65.33%
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70.51%
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67.79%
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65.32%
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67.15%
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66.20%
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(1)
The net interest
margin is calculated by dividing tax equivalent net interest income
by total average earning assets. Tax equivalent interest income is
calculated by grossing up interest income for the amounts that are
nontaxable (i.e. municipal securities and loan income) then
subtracting interest expense. The tax rate utilized is 21%. The
Company’s net interest margin is a common measure used by the
financial service industry to determine how profitable earning
assets are funded. Because the Company earns nontaxable interest
income from municipal loans and securities, net interest income for
the ratio is calculated on a tax equivalent basis as described
above.
(2)
The efficiency
ratio is not a measurement under accounting principles generally
accepted in the United States. The efficiency ratio is a common
measure used by the financial service industry to determine
operating efficiency. It is calculated by dividing non-interest
expense by the sum of tax equivalent net interest income and
non-interest income excluding gains and losses on the investments
portfolio and Other Real Estate Owned. The Company calculates this
ratio in order to evaluate how efficiently it utilizes its
operating structure to create income. An increase in the ratio from
period to period indicates the Company is losing a greater
percentage of its income to expenses.
2
F
& M Bank Corp.
Financial
Highlights
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For Six
Months
Ended June
30,
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INCOME
STATEMENT
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Unaudited
2020
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Unaudited
2019
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Interest and
Dividend Income
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$18,101,844
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$19,313,133
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Interest
Expense
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3,090,815
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3,224,392
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Net
Interest Income
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15,011,029
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16,088,741
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Non-Interest
Income
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5,681,703
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4,265,082
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Provision for Loan
Losses
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2,300,000
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3,050,000
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Impairment of long
lived assets
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19,193
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-
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Other Non-Interest
Expenses
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14,385,236
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14,121,689
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Income
Before Income Taxes
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3,988,303
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3,182,134
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Provision for
Income Taxes
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173,250
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232,317
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Less Minority
Interest (income)/loss
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-
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(28,589)
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Net
Income
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$3,815,053
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$2,921,228
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Dividend on
preferred stock
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131,746
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157,373
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Net Income
available to common shareholders
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$3,683,307
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$2,763,855
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Average Common
Shares Outstanding
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3,199,183
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3,200,119
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Net Income Per
Common Share
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1.15
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.86
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Dividends
Declared
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.52
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.50
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3
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BALANCE
SHEET
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Unaudited
June
30,
2020
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Unaudited
June
30,
2019
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Cash and Due from
Banks
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$16,950,810
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$8,075,243
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Interest Bearing
Bank Deposits
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1,199,474
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768,029
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Federal Funds
Sold
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68,548,000
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5,937,000
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Loans Held for
Sale
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90,403,042
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78,405,674
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Loans Held for
Investment
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661,528,802
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636,407,632
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Less
Allowance for Loan Losses
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(10,033,466)
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(6,050,257)
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Net
Loans Held for Investment
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651,495,336
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630,357,375
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Securities
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93,381,484
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23,524,719
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Other
Assets
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59,623,971
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59,880,840
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Total
Assets
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$981,602,117
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$806,948,880
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Deposits
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$766,651,982
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$608,470,178
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Short Term
Debt
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-
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40,000,000
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Long Term
Debt
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100,585,081
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47,916,889
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Other
Liabilities
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22,063,159
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18,487,049
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Total
Liabilities
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889,300,222
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714,874,116
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Preferred
Stock
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4,591,623
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5,591,623
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Common
Equity
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87,710,272
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86,483,141
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Stockholders’
Equity
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92,301,895
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92,074,764
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Total
Liabilities and Stockholders’ Equity
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$981,602,117
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$806,948,880
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Book Value Per
Common Share
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$27.44
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$27.18
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Tangible Book Value
Per Common Share
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$27.51
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$27.23
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SOURCE:
F
& M Bank Corp.
CONTACT:
Carrie Comer EVP/Chief Financial Officer
540-896-8941 or
ccomer@fmbankva.com
4