Farmers & Merchants Bancorp, Inc. Reports 2021 Second-Quarter and Year-to-Date Financial Results

ARCHBOLD, Ohio, July 21, 2021 (GLOBE NEWSWIRE) — Farmers & Merchants Bancorp, Inc. (Nasdaq: FMAO) today reported financial results for the 2021 second quarter and year-to-date June 30, 2021.

2021 Second Quarter Financial and Operating Highlights

(compared to the 2020 second quarter period unless noted):

• Net income increased 3.7% to $5.0 million, and included one-time acquisition costs of $1.0 million
• Earnings increased 2.3% to $0.44 per basic and diluted share, and included one-time acquisition costs of $0.08 per basic and diluted share
• Net interest income after provision for loan losses increased by 17.9% to $15.3 million
• Noninterest income increased 21.1% to $4.0 million
• Second quarter after-tax income benefited from $0.35 million of accelerated fees associated with the Paycheck Protection Program (“PPP”)
• Loans have increased 3.9% organically year-to-date, not including recent acquisitions or PPP loans
• Net charge-offs to average loans were 0.00%, compared to 0.01%
• Adjusted return on average tangible equity increased to 11.28% from 9.98%
• Completed the acquisition of Ossian Financial
• Announced the acquisition of Perpetual Federal Savings Bank
• Appointed Frank R. Simon to the Board of Directors
• Opened a new full-service office in Fort Wayne, IN

“I am excited by the progress F&M is making as we continue to achieve strong execution across all of our key business strategies, while deepening customer relationships, expanding into new markets, and delivering robust operating and financial results,” stated Lars B. Eller, President and Chief Executive Officer. “In 2019 we created a strategic plan aimed at growing earnings and creating value for shareholders by increasing total assets from $1.6 billion to $3.0 billion by 2023. We expect earnings growth will accelerate in the coming quarters as we benefit from the progress we are making on executing our strategic growth plan.”

On April 30, 2021, F&M successfully closed the acquisition of Ossian Financial Services, Inc (“OFSI”).   OFSI is F&M’s third recent acquisition in Northeast Indiana and immediately enhances the Company’s growing franchise within the state. The integration and conversion were completed during the second quarter, and OFSI’s offices and online portal have transitioned to F&M. Also, in the 2021 second quarter, the Company announced the upcoming acquisition of Perpetual Federal Savings Bank (“PFSB”), expanding F&M’s community banking franchise into the compelling Urbana, Columbus, Dayton, Springfield, Piqua, Tipp City, Troy, and Sidney markets. The Company expects the PFSB acquisition to close in October 2021.

Mr. Eller continued, “Acquisition growth is an important component of our strategic growth plan and over the past 12 months we have announced two bank acquisitions and acquired an Indiana based wealth management company. Through the OFSI and PFSB acquisitions, we expect to add a combined $513 million in new assets and $413 million in new deposits. F&M will also see expense benefits as we re-align our footprint and add new customers to a single platform, which will help to contribute to earnings and allow us to further invest in technology to improve the experience for our customers and employees.”  

Mr. Eller continued, “Despite our recent growth and expansion, we remain committed to honoring the community banking values that are responsible for our accomplishments over the past 124 years and continue to drive our success today. As a result, F&M has continued to experience strong organic loan growth outside of PPP and acquired loans during the first half of 2021.   Organic loans have increased 3.9% year-to-date. In addition, our credit portfolio remains strong and 30+ days past due accounts as of June 30, 2021 were 0.12%, the lowest level since 2018.”

Income Statement

Net income for the 2021 second quarter ended June 30, 2021, was $5.0 million, compared to $4.8 million for the same period last year. Net income per basic and diluted share for the 2021 second quarter was $0.44, compared to $0.43 for the same period last year. Net income for the 2021 first half ended June 30, 2021, was $9.9 million, compared to $8.9 million for the same period last year. Net income per basic and diluted share for the 2021 first half was $0.88, compared to $0.80 for the same period last year.

Net income for the 2021 second quarter and first half included one-time tax adjusted expenses of $0.8 million and $1.0 million, respectively. On a per share basis, for the 2021 second quarter and first half, net income included one-time tax adjusted expenses of $0.08 or $0.11, respectively, per basic and diluted share.

Mr. Eller continued, “F&M’s larger size and expanded footprint have helped establish diversity within our revenue streams and insulated our earnings. For the 2021 first half, noninterest income as a percent of total revenue has increased to 20.8%, compared to 15.7% for the same period last year. In addition, during the 2021 first half, we have incurred several one-time costs due to our strategic growth focus, which has reduced the level of profitability we are accustomed to seeing. However, we expect to realize significant long-term benefits from our strategies and we believe we will experience an acceleration in profitability in the coming quarters.”

Deposits

At June 30, 2021, total deposits were $1.854 billion, an increase of 25.5% from June 30, 2020, and an increase of 16.2% from December 31, 2020. The significant organic deposit growth being experienced is a result of continued strength in expanding relationships with new and existing customers, the benefits of PPP activity, and the completion of the Ossian Financial Services, Inc. acquisition. In addition, we continue to see growing customer preferences to more stable and secure saving instruments as deposits have increased since the COVID-19 crisis began.

Loan Portfolio and Asset Quality

Total loans, net at June 30, 2021, increased 8.4%, or by $113.7 million to $1.458 billion, compared to $1.345 billion at June 30, 2020, and up from $1.303 billion at December 31, 2020. The year-over-year improvement resulted primarily from the contribution of continued organic loan growth and the completion of the Ossian Financial Services, Inc. acquisition. In addition, during the 2021 second quarter, the Company processed $12.9 million of PPP loan forgiveness and principal payments received, resulting in a total of $47.0 million of PPP loans within F&M’s loan portfolio at June 30, 2021.

Mr. Eller continued: “At June 30, 2021, there were only two loans totaling $0.6 million of COVID-related payment modifications, all of which are interest-only modifications and secured by real estate. This compares to 190 loans representing a balance of $165 million in deferrals at the peak last year. As economic activity stabilizes, and our loan performance improves better than pre-pandemic levels, we expect contributions to our allowance for loan losses will also stabilize and align with loan growth in future periods.”    

F&M continues to closely monitor its loan portfolio with a particular emphasis on higher risk sectors. Nonperforming loans were $7.0 million, or 0.48% of total loans at June 30, 2021, compared to $8.5 million, or 0.63% at June 30, 2020.

Mr. Eller continued, “As we work to integrate and close our recent acquisitions, we remain focused on operational excellence, investments in technology, supporting our communities, and ensuring a best-in-class experience for our customers. In addition, we are committed to attracting and retaining experienced professionals across our organization, and I am encouraged with the addition of Frank R. Simon to our Board of Directors. We continue to believe 2021 will be a transformative year for F&M and we expect our enhanced scale and operating platform will magnify shareholder value.”

Stockholders’ Equity and Dividends

Total stockholders’ equity increased 4.3% to $250.6 million at June 30, 2021, from $240.3 million at June 30, 2020. At June 30, 2021, the Company had a Tier 1 leverage ratio of 8.78%, compared to 10.70% at June 30, 2020.

Tangible stockholders’ equity increased to $189.6 million at June 30, 2021, compared to $181.7 million at June 30, 2020. On a per share basis, tangible stockholders’ equity at June 30, 2021, was $16.94 per share, compared to $16.33 per share at June 30, 2020.

For the six months ended June 30, 2021, the Company has declared cash dividends of $0.34 per share, which is a 6.3% increase over the 2020 six-month declared dividend payment. F&M is committed to returning capital to shareholders and has increased the annual cash dividend for over 26 consecutive years. For the six months ended June 30, 2021, the dividend payout ratio was 38.18% compared to 39.69% 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 Fulton, Defiance, Hancock, Henry, Lucas, Williams, and Wood counties in Northwest Ohio. In Northeast Indiana, we have offices located in Adams, Allen, DeKalb, Jay, and Steuben counties.

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, 2021			March 31, 2021				December 31, 2020				September 30, 2020				June 30, 2020					June 30, 2021				June 30, 2020
Interest Income
Loans, including fees		$	16,259		$	15,612			$	17,061			$	16,181			$	16,192				$	31,871			$	32,075
Debt securities:
U.S. Treasury and government agencies			857			751				695				761				767					1,608				1,913
Municipalities			289			308				295				279				243					597				505
Dividends			31			50				35				36				26					81				71
Federal funds sold			6			5				5				4				5					11				11
Other.			88			39				48				32				40					127				162
Total interest income			17,530			16,765				18,139				17,293				17,273					34,295				34,737
Interest Expense
Deposits			1,276			1,340				1,619				1,864				2,254					2,616				5,155
Federal funds purchased and securities sold under agreements to repurchase			163			166				170				174				187					329				431
Borrowed funds			115			222				226				231				257					337				523
Total interest expense			1,554			1,728				2,015				2,269				2,698					3,282				6,109
Net Interest Income – Before Provision for Loan Losses			15,976			15,037				16,124				15,024				14,575					31,013				28,628
Provision for Loan Losses			641			1,700				1,995				1,987				1,569					2,341				2,999
Net Interest Income After Provision For Loan Losses			15,335			13,337				14,129				13,037				13,006					28,672				25,629
Noninterest Income
Customer service fees			2,198			2,814				2,750				2,299				2,258					5,012				3,844
Other service charges and fees			874			838				980				879				704					1,712				1,743
Net gain on sale of loans			955			1,046				1,894				1,537				364					2,001				591
Net gain on sale of available-for-sale securities			–			293				–				–				–					293				270
Total noninterest income			4,027			4,991				5,624				4,715				3,326					9,018				6,448
Noninterest Expense
Salaries and wages			4,591			4,390				5,068				5,102				4,095					8,981				8,266
Employee benefits			1,915			1,994				1,140				1,566				1,218					3,909				2,895
Net occupancy expense			546			577				585				558				564					1,123				1,128
Furniture and equipment			848			791				760				875				750					1,639				1,508
Data processing			428			505				428				490				408					933				850
Franchise taxes			294			446				241				368				369					740				737
ATM expense			459			449				456				444				376					908				790
Advertising			331			235				353				411				265					566				568
Net (gain) loss on sale of other assets owned			227			(25	)			20				(7	)			(7	)				202				(6	)
FDIC assessment			276			236				223				194				144					512				216
Mortgage servicing rights amortization			524			505				247				296				356					1,029				488
Consulting fees			394			223				407				205				217					617				356
Other general and administrative			2,227			2,033				1,358				1,553				1,612					4,260				3,293
Total noninterest expense			13,060			12,359				11,286				12,055				10,367					25,419				21,089
Income Before Income Taxes			6,302			5,969				8,467				5,697				5,965					12,271				10,988
Income Taxes			1,319			1,060				1,691				1,287				1,161					2,379				2,079
Net Income			4,983			4,909				6,776				4,410				4,804					9,892				8,909
Other Comprehensive Income (Loss) (Net of Tax):
Net unrealized gain (loss) on available-for-sale securities			786			(6,737	)			(207	)			639				661					(5,951	)			5,659
Reclassification adjustment for realized gain on sale of available-for-sale securities			–			(293	)			–				–				–					(293	)			(270	)
Net unrealized gain (loss) on available-for-sale securities			786			(7,030	)			(207	)			639				661					(6,244	)			5,389
Tax expense (benefit)			165			(1,476	)			(44	)			134				139					(1,311	)			1,132
Other comprehensive income (loss)			621			(5,554	)			(163	)			505				522					(4,933	)			4,257
Comprehensive Income (Loss)		$	5,604		$	(645	)		$	6,613			$	4,915			$	5,326				$	4,959			$	13,166
Basic and Diluted Earnings Per Share		$	0.44		$	0.44			$	0.60			$	0.40			$	0.43				$	0.88			$	0.80
Dividends Declared		$	0.17		$	0.17			$	0.17			$	0.17			$	0.16				$	0.34			$	0.32

 

FARMERS & MERCHANTS BANCORP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited) (in thousands of dollars, except share data)
			June 30, 2021				March 31, 2021				December 31, 2020				September 30, 2020				June 30, 2020
			(Unaudited)				(Unaudited)								(Unaudited)				(Unaudited)
Assets
Cash and due from banks			$	93,636			$	118,139			$	98,279			$	46,395			$	54,336
Federal funds sold				57,483				57,361				77,427				41,358				31,105
	Total cash and cash equivalents			151,119				175,500				175,706				87,753				85,441
Interest-bearing time deposits				18,597				4,405				4,653				4,657				4,636
Securities – available-for-sale				407,500				352,974				307,812				259,041				236,292
Other securities, at cost				6,419				5,939				5,939				5,827				5,810
Loans held for sale				8,041				7,511				8,391				7,621				11,445
Loans, net				1,443,336				1,327,254				1,288,667				1,351,979				1,334,790
Premises and equipment				26,915				26,703				27,063				26,776				26,049
Goodwill				56,066				47,340				47,340				47,340				47,340
Mortgage servicing rights				3,146				3,444				3,320				3,027				2,740
Other real estate owned				198				148				71				206				135
Bank owned life insurance				27,218				25,347				25,208				15,501				15,399
Other assets				18,310				16,720				15,374				16,872				14,370
Total Assets			$	2,166,865			$	1,993,285			$	1,909,544			$	1,826,600			$	1,784,447
	Liabilities and Stockholders’ Equity
Liabilities
Deposits
	Noninterest-bearing		$	443,863			$	384,558			$	351,147			$	330,845			$	336,027
	Interest-bearing
	NOW accounts			652,078				605,533				542,317				534,792				504,846
	Savings			501,687				451,043				455,145				392,059				374,871
	Time			256,445				242,717				247,553				261,177				261,631
	Total deposits			1,854,073				1,683,851				1,596,162				1,518,873				1,477,375
Federal funds purchased and securities sold under agreements to repurchase				29,882				30,072				30,239				29,859				30,949
Federal Home Loan Bank (FHLB) advances				17,868				17,840				17,861				17,724				19,087
Dividend payable				1,888				1,889				1,889				1,882				1,768
Accrued expenses and other liabilities				12,569				12,805				14,233				14,841				14,971
	Total liabilities			1,916,280				1,746,457				1,660,384				1,583,179				1,544,150
Commitments and Contingencies
Stockholders’ Equity
Common stock – No par value 20,000,000 shares authorized; issued and outstanding 12,230,000 shares 6/30/21 and 12/31/20				82,259				82,030				81,804				81,577				82,134
Treasury stock – 1,040,948 shares 6/30/21, 1,032,456 shares 12/31/20				(12,172	)			(11,962	)			(11,932	)			(12,397	)			(12,668	)
Retained earnings				179,734				176,617				173,591				168,381				165,476
Accumulated other comprehensive income				764				143				5,697				5,860				5,355
	Total stockholders’ equity			250,585				246,828				249,160				243,421				240,297
Total Liabilities and Stockholders’ Equity			$	2,166,865			$	1,993,285			$	1,909,544			$	1,826,600			$	1,784,447

 

FARMERS & MERCHANTS BANCORP, INC. AND SUBSIDIARIES
SELECT FINANCIAL DATA
			For the Three Months Ended																				For the Six Months Ended
Selected financial data		June 30, 2021				March 31, 2021				December 31, 2020				September 30, 2020				June 30, 2020					June 30, 2021				June 30, 2020
Return on average assets			0.90	%			1.01	%			1.43	%			0.98	%			1.10	%			0.98	%			1.06	%
Return on average equity			8.00	%			7.87	%			11.04	%			7.28	%			8.07	%			7.94	%			7.57	%
Yield on earning assets			3.53	%			3.71	%			4.09	%			4.04	%			4.25	%			3.61	%			4.44	%
Cost of interest bearing liabilities			0.44	%			0.53	%			0.64	%			0.74	%			0.91	%			0.48	%			1.06	%
Net interest spread			3.09	%			3.18	%			3.45	%			3.30	%			3.34	%			3.13	%			3.38	%
Net interest margin			3.21	%			3.33	%			3.63	%			3.51	%			3.59	%			3.27	%			3.67	%
Efficiency			64.98	%			62.57	%			52.20	%			62.11	%			57.91	%			63.72	%			60.43	%
Dividend payout ratio			37.89	%			38.48	%			27.77	%			42.66	%			36.80	%			38.18	%			39.69	%
Tangible book value per share (1)		$	16.94			$	17.50			$	17.19			$	16.78			$	16.33
Tier 1 capital to average assets			8.78	%			10.39	%			10.46	%			10.65	%			10.70	%
Average Shares Outstanding			11,191,043				11,197,012				11,177,765				11,142,797				11,129,341				11,194,011				11,132,105
Loans		June 30, 2021				March 31, 2021				December 31, 2020				September 30, 2020				June 30, 2020
(Dollar amounts in thousands)
Commercial real estate		$	691,122			$	618,754			$	588,825			$	595,146			$	589,382
Agricultural real estate			189,742				179,945				189,159				192,883				194,606
Consumer real estate			194,715				175,675				175,588				175,963				174,069
Commercial and industrial			216,609				202,958				189,246				238,175				223,842
Agricultural			100,756				100,022				94,358				103,330				107,458
Consumer			56,427				54,445				52,540				53,320				50,108
Other			13,549				14,088				15,757				9,030				9,714
Less: Net deferred loan fees and costs			(4,497	)			(4,208	)			(2,483	)			(3,985	)			(4,456	)
Total loans,net		$	1,458,423			$	1,341,679			$	1,302,990			$	1,363,862			$	1,344,723
Asset quality data		June 30, 2021				March 31, 2021				December 31, 2020				September 30, 2020				June 30, 2020
(Dollar amounts in thousands)
Nonaccrual loans		$	7,031			$	8,139			$	9,404			$	7,870			$	8,473
Troubled debt restructuring		$	5,492			$	5,774			$	6,514			$	7,028			$	7,034
90 day past due and accruing		$	–			$	–			$	–			$	–			$	–
Nonperforming loans		$	7,031			$	8,139			$	9,404			$	7,870			$	8,473
Other real estate owned		$	198			$	148			$	71			$	206			$	135
Nonperforming assets		$	7,229			$	8,287			$	9,475			$	8,076			$	8,608
(Dollar amounts in thousands)
Allowance for loan and lease losses		$	15,087			$	14,425			$	13,672			$	11,883			$	10,538
Allowance for loan and lease losses/total loans			1.03	%			1.08	%			1.05	%			0.87	%			0.78	%
Net charge-offs (recoveries):
Quarter-to-date		$	(21	)		$	947			$	205			$	37			$	169
Year-to-date		$	926			$	947			$	537			$	331			$	294
Net charge-offs to average loans
Quarter-to-date			0.00	%			0.07	%			0.02	%			0.00	%			0.01	%
Year-to-date			0.07	%			0.07	%			0.04	%			0.03	%			0.02	%
Nonperforming loans/total loans			0.48	%			0.61	%			0.72	%			0.58	%			0.63	%
Allowance for loan and lease losses/nonperforming loans			214.58	%			177.24	%			177.96	%			151.01	%			117.24	%
(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, 2021									June 30, 2020
Interest Earning Assets:		Average Balance			Interest/Dividends			Annualized Yield/Rate			Average Balance			Interest/Dividends			Annualized Yield/Rate
Loans		$	1,419,531		$	16,259		4.58	%		$	1,321,405		$	16,192		4.90	%
Taxable investment securities			367,249			1,100		1.20	%			189,977			931		1.96	%
Tax-exempt investment securities			17,497			77		2.23	%			21,915			105		2.43	%
Fed funds sold & other			187,583			94		0.20	%			93,041			45		0.19	%
Total Interest Earning Assets			1,991,860		$	17,530		3.53	%			1,626,338		$	17,273		4.25	%
Nonearning Assets			228,036									125,730
Total Assets		$	2,219,896								$	1,752,068
Interest Bearing Liabilities:
Savings deposits		$	1,123,157		$	566		0.20	%		$	859,644		$	954		0.44	%
Other time deposits			250,277			710		1.13	%			269,897			1,300		1.93	%
Other borrowed money			17,859			115		2.58	%			23,496			257		4.38	%
Fed funds purchased & securities sold under agreement to repurchase			29,980			163		2.17	%			30,300			187		2.47	%
Total Interest Bearing Liabilities		$	1,421,273		$	1,554		0.44	%		$	1,183,337		$	2,698		0.91	%
Noninterest bearing Liabilities			549,610									330,611
Stockholders Equity		$	249,013								$	238,120
Net Interest Income and Interest Rate Spread					$	15,976		3.09	%					$	14,575		3.34	%
Net Interest Margin								3.21	%								3.59	%
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, 2021									June 30, 2020
Interest Earning Assets:		Average Balance			Interest/Dividends			Annualized Yield/Rate			Average Balance			Interest/Dividends			Annualized Yield/Rate
Loans		$	1,374,302		$	31,871		4.64	%		$	1,279,127		$	32,075		5.02	%
Taxable investment securities			345,893			2,109		1.22	%			190,067			2,252		2.37	%
Tax-exempt investment securities			18,936			177		2.37	%			25,374			237		2.36	%
Fed funds sold & other			162,646			138		0.17	%			71,927			173		0.48	%
Total Interest Earning Assets			1,901,777		$	34,295		3.61	%			1,566,495		$	34,737		4.44	%
Nonearning Assets			126,533									117,818
Total Assets		$	2,028,310								$	1,684,313
Interest Bearing Liabilities:
Savings deposits		$	1,069,179		$	1,140		0.21	%		$	816,610		$	2,439		0.60	%
Other time deposits			246,155			1,476		1.20	%			273,738			2,716		1.98	%
Other borrowed money			17,854			337		3.78	%			24,141			523		4.33	%
Fed funds purchased & securities sold under agreement to repurchase			30,095			329		2.19	%			34,627			431		2.49	%
Total Interest Bearing Liabilities		$	1,363,283		$	3,282		0.48	%		$	1,149,116		$	6,109		1.06	%
Noninterest bearing Liabilities			415,722									299,859
Stockholders Equity		$	249,305								$	235,338
Net Interest Income and Interest Rate Spread					$	31,013		3.13	%					$	28,628		3.38	%
Net Interest Margin								3.27	%								3.67	%
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
NOTES TO CONDENSED CONSOLIDATED UNAUDITED FINANCIAL STATEMENTS
Non-GAAP Allowance for Loan Losses, excluding PPP Loans
(in thousands of dollars, except percentages)
		June 30, 2021
Allowance for Loan Losses		$	15,087
Credit Mark			2,172
Total Credit Mark and Allowance for Loan Losses			17,259
Loans		$	1,458,423
Adjustments
PPP Loans			(47,041	)
Loans excluding PPP Loans		$	1,411,382
Allowance for Loan Losses			1.03	%
Effect of Credit Mark			0.15	%
Effect of PPP Loans			0.04	%
Allowance for Loan Losses, excluding PPP Loans			1.22	%

 

FARMERS & MERCHANTS BANCORP, INC. AND SUBSIDIARIES
NON-GAAP RECONCILIATION OF NET INCOME
		(in thousands of dollars)							(in thousands of dollars)
		Three Months Ended							Six Months Ended
Non-GAAP Reconciliation of Net Income		June 30, 2021				June 30, 2020			June 30, 2021				June 30, 2020
		(Unaudited)							(Unaudited)
Net income as reported		$	4,983			$	4,804		$	9,892			$	8,909
Net income from Ossian Financial Services, Inc prior to acquisition		$	54			$	–		$	269			$	–
Acquisition expenses			1,092				–			1,248				–
Tax effect			(224	)			–			(295	)			–
Net income excluding acquisition expenses		$	5,905			$	4,804		$	11,114			$	8,909

 

Company Contact:	Investor and Media Contact:
Lars B. Eller President and Chief Executive Officer Farmers & Merchants Bancorp, Inc. (419) 446-2501 [email protected]	Andrew M. Berger Managing Director SM Berger & Company, Inc. (216) 464-6400 [email protected]