Farmers & Merchants Bank of Long Beach Reports 2014 Fourth-Quarter and Full-Year Results

Company Release - 1/15/2015

-- Net Loans Grew 23% in Year-Over-Year Comparison --

LONG BEACH, Calif.--(BUSINESS WIRE)-- Farmers & Merchants Bank of Long Beach (OTCBB: FMBL) today reported financial results for the fourth quarter and full year ended December 31, 2014.

“F&M’s strong financial performance in 2014 is a result of an expanded lending team that continues to establish relationships with the community we serve,” said Henry Walker, president of Farmers & Merchants Bank. “As the economy shows further signs of improvement, the Bank is in a position of strength for sustainable growth.”

Income Statement

For the 2014 fourth quarter, total interest income was $49.8 million, compared with $43.5 million in the fourth quarter of 2013. Total interest income for the year ended December 31, 2014 was $184.9 million, compared with $163.2 million reported for 2013.

Interest expense for the 2014 fourth quarter was $1.8 million, compared with $1.6 million in the same period a year ago. Interest expense for the full 2014 year was $6.9 million versus $6.2 million in 2013.

Farmers & Merchants’ net interest income for the 2014 fourth quarter was $48.0 million, compared with net interest income of $41.9 million for the fourth quarter in 2013. Net interest income for 2014 was $178.0 million, versus $157.0 million in 2013.

Farmers & Merchant’s net interest margin was 3.50% for the year ended December 31, 2014, compared with 3.30% in the previous year.

The Bank did not have a provision for loan losses in 2014, nor in 2013, amid continued strength in its loan portfolio. The Bank’s allowance for loan losses as a percentage of loans outstanding was 1.69% at December 31, 2014, compared with 2.09% at December 31, 2013.

Non-interest income was $7.3 million for the 2014 fourth quarter, compared with $7.2 million in the 2013 fourth quarter. Non-interest income for the full 2014 year totaled $32.0 million, versus $37.8 million for 2013.

Non-interest expense for the 2014 fourth quarter was $32.2 million, compared with $27.2 million for the same period last year. Non-interest expense for the year ended December 31, 2014 was $119.4 million, compared with $104.3 million last year.

The Bank’s net income for the 2014 fourth quarter was $15.8 million, or $120.94 per diluted share, compared with $15.0 million, or $114.41 per diluted share, in the 2013 fourth quarter. The Bank’s net income for 2014 was $62.4 million, or $476.67 per diluted share, compared with $62.2 million, or $474.80 per diluted share, for 2013.

Balance Sheet

At December 31, 2014, net loans totaled $2.96 billion, compared with $2.40 billion at December 31, 2013. The Bank’s deposits grew to $4.20 billion at the end of 2014, from $3.83 billion at December 31, 2013. Non-interest bearing deposits represented 37.3% of total deposits at December 31, 2014, versus 38.5% of total deposits at December 31, 2013. Total assets increased to $5.58 billion at the close of 2014 from $5.21 billion at December 31, 2013.

At December 31, 2014, Farmers & Merchants Bank remained “well-capitalized” under all regulatory categories, with a total risk-based capital ratio of 23.59%, a Tier 1 risk-based capital ratio of 22.34%, and a Tier 1 leverage ratio of 14.35%. The minimum ratios for capital adequacy for a well-capitalized bank are 10.00%, 6.00% and 5.00%, respectively.

“F&M maintained its robust financial health in 2014, as well as enhanced its infrastructure to continue the Bank’s leadership position throughout the regions we serve,” said Daniel Walker, chief executive officer and chairman of the board. “As we enter 2015, F&M’s healthy balance sheet and sound fundamentals provide an excellent platform for introducing the Bank’s unparalleled service to new clients.”

About Farmers & Merchants Bank

Founded in Long Beach in 1907 by C.J. Walker, Farmers & Merchants Bank has 23 branches in Los Angeles and Orange Counties. The Bank specializes in commercial and small business banking along with business loan programs. Farmers & Merchants Bank of Long Beach is a California state chartered bank with deposits insured by the Federal Deposit Insurance Corporation (Member FDIC) and an Equal Housing Lender. For more information about F&M, please visit www.fmb.com.

FARMERS & MERCHANTS BANK OF LONG BEACH
Income Statements (Unaudited)
(In thousands except per share data)
     
Three Months Ended Dec. 31,Twelve Months Ended Dec. 31,
20142013   2014   2013
 
Interest and dividend income:
 
Loans $ 35,281 $ 28,351 $ 128,254 $ 105,163
Securities available-for-sale 982 1,778 5,148 8,067
Securities held-to-maturity 12,490 13,323 49,864 49,441
Investments in FHLB and FRB stock 956 7 1,290 26
Deposits with banks 63 31 313 488
 
Total interest and dividend income 49,772 43,490 184,869 163,185
 
Interest expense:
 
Deposits 1,491 1,296 5,744 5,049
Securities sold under repurchase agreements 267 274 1,140 1,113
Other borrowings 29 3 34 3
 
Total interest expense 1,787 1,573 6,918 6,165
 
Net interest income before provision for loan losses 47,985 41,917 177,951 157,020
 
Provision for loan losses - - - -
 
Net interest income after provision for loan losses 47,985 41,917 177,951 157,020
 
Non-interest income:
 
Service charges on deposit accounts 1,098 1,151 4,570 4,554
Gains on sale of securities 689 261 1,114 1,308
Other real estate owned income 827 482 1,583 3,757
Merchant bankcard income 2,281 2,348 9,365 9,358
Other income 2,361 2,944 15,385 18,810
 
Total non-interest income 7,256 7,186 32,017 37,788
 
Non-interest expense:
 
Salaries and employee benefits 17,093 15,726 64,492 55,986
FDIC and other insurance expense 782 123 3,087 4,825
Occupancy expense 2,077 1,952 8,043 6,987
Software and equipment expense 2,143 1,434 7,057 6,026
Other real estate owned expense 703 285 3,207 528
Amortization of public welfare investments 2,117 2,021 8,468 8,082
Merchant bankcard expense 1,814 1,929 7,386 7,493
Legal and professional services 1,151 885 3,709 3,604
Marketing expense 1,925 772 6,333 3,706
Other expense 2,399 2,119 7,644 7,025
2,922 2,922
Total non-interest expense 32,204 27,246 119,426 104,262
 
Income before income tax expense 23,037 21,857 90,542 90,546
 
Income tax expense 7,202 6,878 28,133 28,382
 
Net income$15,835$14,979$62,409$62,164
 
Basic and diluted earnings per common share $ 120.94 $ 114.41 $ 476.67 $ 474.80
 
FARMERS & MERCHANTS BANK OF LONG BEACH
Balance Sheets (Unaudited)
(In thousands except share and per share data)
 
Dec. 31, 2014Dec. 31, 2013
 
Assets
 
Cash and due from banks:
Noninterest-bearing balances $ 55,322 $ 65,261
Interest-bearing balances 137,826 20,755
Securities available-for-sale 215,223 427,942
Securities held-to-maturity 2,008,064 2,145,289
Loans held for sale 1,751 465
Gross loans 3,009,945 2,454,302
Less allowance for loan losses (50,804 ) (51,251 )
Less unamortized deferred loan fees, net (2,991 ) (1,704 )
Net loans 2,956,150   2,401,347  
Other real estate owned, net 3,406 14,502
Investments in FHLB and FRB stock 28,440 440
Public welfare investments 45,457 27,722
Bank premises and equipment, net 85,002 66,212
Net deferred tax assets 23,296 23,512
Other assets 20,788   21,139  
 
Total assets$5,580,725   $5,214,586  
 
 
Liabilities and Stockholders' Equity
 
Liabilities:
 
Deposits:
Demand, non-interest bearing $ 1,567,046 $ 1,475,888
Demand, interest bearing 552,432 413,291
Savings and money market savings 1,228,584 1,080,774
Time deposits 852,211   861,489  
 
Total deposits 4,200,273 3,831,442
 
Securities sold under repurchase agreements 546,758 595,991
Other liabilities 27,133   27,986  
 
Total liabilities4,774,164   4,455,419  
 
Stockholders' Equity:
 
Common Stock, par value $20; authorized 250,000
shares; issued and outstanding 130,928 shares 2,619 2,619
Additional paid-in capital 112,044 12,044
Retained earnings 689,892 742,408
Accumulated other comprehensive income 2,006   2,096  
 
Total stockholders' equity806,561   759,167  
 
Total liabilities and stockholders' equity$5,580,725   $5,214,586  

Farmers & Merchants Bank of Long Beach
John Hinrichs
Executive Vice President
562-437-0011, ext. 5035
or
PondelWilkinson Inc.
Evan Pondel
Investor Relations
310-279-5980
investor@pondel.com

Source: Farmers & Merchants Bank of Long Beach
Copyright , © Powered By Q4 Inc.