Farmers & Merchants Bank of Long Beach (OTCBB: FMBL) today reported financial results for the first quarter ended March 31, 2012.
“Farmers & Merchants’ first-quarter results reflect a strong start for 2012, as we achieved solid profitability and continued to grow the Bank’s deposit base,” said Henry Walker, chief executive officer of Farmers & Merchants Bank of Long Beach. “During the quarter, we also continued to enhance the Bank’s technology and auditing teams with the naming of industry veteran Ken Nagel as chief information officer and tenured accounting executive Frank Coleman as chief auditor.”
For the three months ended March 31, 2012, interest income rose to $46.3 million from $45.3 million in the first quarter of 2011. Interest expense for the 2012 first quarter declined to $1.8 million from $2.6 million in the first quarter of 2011, primarily related to the prolonged low interest rate environment.
Net interest income for the 2012 first quarter rose 4.10% to $44.4 million from $42.7 million for the first quarter of 2011. Farmers & Merchants’ net interest margin was 4.07% for the 2012 first quarter, compared with 4.29% in the 2011 first quarter.
Primarily due to a decrease in gross loans for the period ended March 31, 2012, the Bank did not establish a provision for loan losses in the first quarter of 2012, compared with a provision for loan losses of $700,000 reported in the first quarter of 2011. The Bank’s allowance for loan losses as a percentage of loans outstanding was 2.86% at March 31, 2012, compared with 2.75% at March 31, 2011.
Non-interest income was $5.2 million for the 2012 first quarter, versus $3.3 million for the first quarter a year ago, principally related to the gain realized from the resolution and conclusion of a lending relationship.
Non-interest expense for the 2012 first quarter was $21.9 million, compared with $21.3 million for the same period last year.
Net income for the 2012 first quarter totaled $18.5 million, or $141.48 per diluted share, compared with net income of $15.3 million, or $117.18 per diluted share, for the 2011 first quarter.
At March 31, 2012, net loans decreased to $1.97 billion from $2.03 billion at December 31, 2011. The Bank’s deposits totaled $3.53 billion at the end of the 2012 first quarter, compared with $3.39 billion at December 31, 2011. Non-interest bearing deposits represented 37.9% of total deposits at March 31, 2012, versus 37.2% of total deposits at December 31, 2011. Total assets increased to $4.77 billion at the close of the 2012 first quarter from $4.70 billion at December 31, 2011.
At March 31, 2012, Farmers & Merchants Bank remained “well-capitalized” under all regulatory categories, with a total risk-based capital ratio of 29.00%, a Tier 1 risk-based capital ratio of 27.73%, and a Tier 1 leverage ratio of 14.45%. The minimum ratios for capital adequacy for a well-capitalized bank are 10.00%, 6.00% and 5.00%, respectively.
“Farmers & Merchants’ first-quarter results reflect the Bank’s ability to adapt and succeed in times of economic uncertainty,” said Daniel Walker, president and chairman of the board. “Despite a heightened regulatory environment, the Bank’s sound fundamentals and steadfast commitment to personalized service remained central to our performance.”
About Farmers & Merchants Bank of Long Beach
Farmers & Merchants Bank of Long Beach provides personal and business banking services through 21 offices in Los Angeles and Orange Counties. Founded in 1907 by C.J. Walker, the Bank specializes in commercial and small business banking along with business loan programs.
|FARMERS & MERCHANTS BANK OF LONG BEACH|
|Income Statements (Unaudited)|
|Three Months Ended March 31,|
|Deposits with banks||219||60|
|Total interest income||46,278||45,260|
|Securities sold under agreement to repurchase||268||435|
|Total interest expense||1,835||2,568|
|Net interest income||44,443||42,692|
|Provision for loan losses||-||700|
|Net int. income after provision for loan losses||44,443||41,992|
|Service charges on deposit accounts||1,199||1,171|
|Gains on sale of securities||42||7|
|Merchant bankcard fees||421||264|
|Total non-interest income||5,171||3,289|
|Salaries and employee benefits||11,761||10,690|
|FDIC and other insurance expense||1,570||1,118|
|Other real estate owned expense,net||1,296||1,492|
|Amortization of investments in low-income communities||2,201||451|
|Legal and professional fees||464||751|
|Marketing and promotional expense||686||805|
|Total non-interest expense||21,932||21,257|
|Income before income tax expense||27,682||24,024|
|Income tax expense||9,159||8,682|
|Basic and diluted earnings per common share||$||141.48||$||117.18|
|FARMERS & MERCHANTS BANK OF LONG BEACH|
|Balance Sheets (Unaudited)|
|Mar. 31, 2012||Dec. 31, 2011|
|Cash and due from banks:|
|Less allowance for loan losses||(58,128||)||(58,463||)|
|Less unamortized deferred loan fees, net||(428||)||(418||)|
|Other real estate owned||19,795||23,036|
|Investments in low-income communities||41,366||43,566|
|Bank premises and equipment||55,052||55,155|
|Accrued interest receivable||16,232||16,464|
|Deferred tax asset||28,573||28,583|
|Liabilities and stockholders' equity|
|Demand, non-interest bearing||$||1,338,382||$||1,263,162|
|Demand, interest bearing||321,741||300,984|
|Savings and money market savings||963,370||909,794|
|Securities sold under agreements to repurchase||502,919||555,992|
Common Stock, par value $20; authorized 250,000 shares; issued and outstanding 130,928 shares
|Other comprehensive income||8,637||8,845|
|Total stockholders' equity||685,781||670,216|
|Total liabilities and stockholders' equity||$||4,769,413||$||4,659,345|
Executive Vice President
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