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Farmers & Merchants Bancorp, Inc. Reports 2025 Second-Quarter and Year-to-Date Financial Results

1. FMAO reported a 35.7% increase in net income to $7.7 million. 2. Net interest margin expanded to 3.22%, marking the fourth consecutive quarter of growth. 3. Total loans increased by 2.6% to $2.63 billion, highlighting strong loan demand. 4. Nonperforming loans rose slightly to $3.7 million, maintaining strong asset quality. 5. FMAO's total stockholders' equity increased by 8.7% to $350.8 million.

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FAQ

Why Very Bullish?

FMAO's strong financial performance indicates robust profitability and strategic growth, similar to past successful quarters that positively impacted stock price.

How important is it?

The strong growth metrics and stable asset quality highlight FMAO's strong position in the market, making it a good investment opportunity.

Why Short Term?

The immediate positive earnings report is likely to influence investor sentiment and stock price in the near term, as seen during other strong earnings releases.

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ARCHBOLD, Ohio, July 28, 2025 (GLOBE NEWSWIRE) -- Farmers & Merchants Bancorp, Inc. (Nasdaq: FMAO) today reported financial results for the 2025 second quarter and year-to-date ended June 30, 2025. 2025 Second Quarter Financial and Operating Highlights(at June 30, 2025 and on a year-over-year basis unless noted) 89 consecutive quarters of profitabilityNet income increased 35.7% to $7.7 million, or $0.56 per basic and diluted shareNet interest margin expands for fourth consecutive quarter, up 51 basis points year-over-year to 3.22%Total loans increased by $67.2 million, or 2.6% to $2.63 billionTotal assets increased by $23.1 million, or 0.7% to $3.35 billionTotal deposits increased by $69.2 million, or 2.6% to $2.71 billionEfficiency ratio improved to 64.93%, compared to 69.03%Asset quality remains at historically strong levels with nonperforming loans of only $3.7 millionNet charge-offs to average loans of 0.00%Tier 1 leverage ratio was 8.50% Lars B. Eller, President and Chief Executive Officer, stated, “Net income for the 2025 second quarter was one of the most profitable quarters and our second-strongest second quarter in F&M’s 128-year history. This performance was driven by strong levels of core profitability, continued growth in our net interest margin, and the successful execution of our multi-year strategic plan. Over the past 12 months, we have enhanced our product offerings, simplified account openings, and continued our focus on attracting and developing proven talent across our regions. The positive momentum we are experiencing today is a direct result of these efforts, as well as our team’s commitment to helping people in our communities live their best lives.” Mr. Eller continued, “Total revenue growth, which is defined by net interest income plus noninterest income, grew by 18.2% year-over-year in the 2025 second quarter, compared to 16.7% in the 2025 first quarter. This growth continues to significantly outpace the rise in noninterest expenses, contributing to a more favorable efficiency ratio and ongoing improvements in core profitability.” “Supporting this revenue momentum is the ongoing expansion of our net interest margin, which increased 51 basis points year-over-year and 19 basis points from the 2025 first quarter. Net interest margin is benefiting from higher asset yields as existing loans reprice and new originations are booked at more favorable rates. At the same time, our growing customer relationships and a more stable interest rate environment have improved our cost of funds.” Income StatementNet income for the 2025 second quarter ended June 30, 2025, was $7.7 million, compared to $5.7 million for the same period last year. Net income per basic and diluted share for the 2025 second quarter was $0.56, compared to $0.42 for the same period last year. Net income for the 2025 first half ended June 30, 2025, was $14.7 million, compared to $11.0 million for the same period last year. Net income per basic and diluted share for the 2025 first half was $1.07, compared to $0.81 for the same period last year. DepositsAt June 30, 2025, total deposits were $2.71 billion, an increase of 2.6% from June 30, 2024. The Company’s cost of interest-bearing liabilities was 2.83% for the quarter ended June 30, 2025, compared to 3.18% for the quarter ended June 30, 2024. Mr. Eller commented, “We ended the second quarter with $2.71 billion in deposits, reflecting the success of our efforts to expand relationship-based banking across the Ohio, Indiana, and Michigan markets. Building on recent product enhancements, we are also investing in new tools and capabilities to expand our marketing efforts and better communicate the value of F&M’s offerings.” Loan Portfolio and Asset Quality“Loan demand remains strong, with total loans, net increasing sequentially by $45.0 million, or at a 7.0% annualized rate. We are managing growth with disciplined pricing and remain focused on maintaining strong asset quality. Net charge offs to average loans have been under 0.03% for 17 consecutive quarters, demonstrating the growing sophistication of our credit cultural and risk management capabilities,” continued Mr. Eller. Total loans, net at June 30, 2025, increased 2.6%, or by $67.2 million to $2.63 billion, compared to $2.56 billion at June 30, 2024. The year-over-year increase was driven primarily by higher commercial real estate, commercial and industrial, and agricultural loans, partially offset primarily by lower agricultural real estate, consumer real estate, and consumer loans. Compared to the quarter ended December 31, 2024, total loans, net at June 30, 2025, increased by 2.5% or $65.0 million. F&M continues to closely monitor its loan portfolio with a particular emphasis on higher risk sectors. Nonperforming loans were $3.7 million, or 0.14% of total loans at June 30, 2025, compared to $2.5 million, or 0.10% of total loans at June 30, 2024, and $3.1 million, or 0.12% at December 31, 2024. F&M maintains a well-balanced, diverse and high performing CRE portfolio. CRE loans represented 51.2% of the Company’s total loan portfolio at June 30, 2025. F&M’s CRE portfolio included the following categories at June 30, 2025: CRE Category Dollar Balance Percent of CRE Portfolio(*) Percent of Total Loan Portfolio(*)       Industrial $281,599  20.9% 10.7%Retail  213,309  15.8% 8.1%Multi-family  213,029  15.8% 8.1%Hotels  172,026  12.8% 6.5%Office  139,844  10.4% 5.3%Gas Stations  77,527  5.8% 3.0%Food Service  52,205  3.9% 2.0%Senior Living  31,088  2.3% 1.2%Development  28,565  2.1% 1.1%Auto Dealers  26,744  2.0% 1.0%Other  110,017  8.2% 4.2%Total CRE $1,345,953  100.0% 51.2%* Numbers have been rounded                  At June 30, 2025, the Company’s allowance for credit losses to nonperforming loans was 720.35%, compared to 1,016% at June 30, 2024, and up from 586.38% at March 31, 2025. The allowance to total loans was 1.08% at June 30, 2025, compared to 1.06% at June 30, 2024. Including accretable yield adjustments, associated with the Company’s prior acquisitions, F&M’s allowance for credit losses to total loans was 1.07% at June 30, 2025, compared to 1.10% at June 30, 2024. Mr. Eller concluded, “We continue to believe F&M is in a strong position because of the platform we have built and the strategies we are pursuing to grow our business profitability. We expect continued loan growth, stable asset quality, and further expansion in our net interest margin to support increasing levels of profitability in the back half of 2025. As a result, we continue to believe 2025 will be another good year for F&M.” Stockholders’ Equity and DividendsTotal stockholders’ equity increased 8.7% to $350.8 million, or $25.56 per share at June 30, 2025, from $322.7 million, or $23.59 per share at June 30, 2024. The Company had a Tier 1 leverage ratio of 8.50% at June 30, 2025, compared to 8.02% at June 30, 2024. Tangible stockholders’ equity increased to $259.6 million at June 30, 2025, compared to $229.6 million at June 30, 2024. On a per share basis, tangible stockholders’ equity at June 30, 2025, was $18.91 per share, compared to $16.79 per share at June 30, 2024. For the six months ended June 30, 2025, the Company declared cash dividends of $0.44250 per share, representing a 0.6% increase over the same period last year. F&M is committed to returning capital to shareholders and has increased the annual cash dividend for 30 consecutive years. For the six months ended June 30, 2025, the dividend payout ratio was 40.90% compared to 53.89% for the same period last year. About Farmers & Merchants State Bank: F&M Bank is a local independent community bank that has been serving its communities since 1897. F&M Bank provides commercial banking, retail banking and other financial services. Our locations are in Butler, Champaign, Fulton, Defiance, Hancock, Henry, Lucas, Shelby, Williams, and Wood counties in Ohio. In Northeast Indiana, we have offices located in Adams, Allen, DeKalb, Jay, Steuben and Wells counties. The Michigan footprint includes Oakland County, and we have Loan Production Offices in Troy, Michigan; Muncie, Indiana; and Perrysburg and Bryan, Ohio. Safe Harbor StatementFarmers & 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.  FARMERS & MERCHANTS BANCORP, INC. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF INCOME & COMPREHENSIVE INCOME(Unaudited) (in thousands of dollars, except per share data)      Three Months Ended  Six Months Ended June 30, 2025 March 31, 2025 December 31, 2024 September 30, 2024 June 30, 2024 June 30, 2025 June 30, 2024Interest Income             Loans, including fees$39,530  $37,072  $36,663  $36,873  $36,593  $76,602  $71,793 Debt securities:             U.S. Treasury and government agencies 2,231   2,097   1,882   1,467   1,148   4,328   2,193 Municipalities 369   382   384   387   389   751   783 Dividends 311   338   367   334   327   649   660 Federal funds sold -   -   24   7   7   -   14 Other 1,051   1,113   2,531   2,833   2,702   2,164   4,377 Total interest income 43,492   41,002   41,851   41,901   41,166   84,494   79,820 Interest Expense             Deposits 14,813   13,988   15,749   16,947   16,488   28,801   31,767 Federal funds purchased and securities sold under agreements to repurchase 272   271   274   277   276   543   560 Borrowed funds 2,411   2,550   2,713   2,804   2,742   4,961   5,431 Subordinated notes 285   284   285   284   285   569   569 Total interest expense 17,781   17,093   19,021   20,312   19,791   34,874   38,327 Net Interest Income - Before Provision for Credit Losses 25,711   23,909   22,830   21,589   21,375   49,620   41,493 Provision for Credit Losses - Loans 661   811   346   282   605   1,472   316 Provision for (Recovery of) Credit Losses - Off Balance Sheet Exposures 27   (260)  (120)  (267)  (18)  (233)  (284)Net Interest Income After Provision for Credit Losses 25,023   23,358   22,604   21,574   20,788   48,381   41,461 Noninterest Income             Customer service fees 330   381   237   300   189   711   787 Other service charges and fees 1,206   1,124   1,176   1,155   1,085   2,330   2,142 Interchange income 1,259   1,421   1,322   1,315   1,330   2,680   2,759 Loan servicing income 629   762   771   710   513   1,391   1,052 Net gain on sale of loans 257   284   223   215   314   541   421 Increase in cash surrender value of bank owned life insurance 239   244   248   265   236   483   452 Net gain (loss) on sale of other assets owned 15   (54)  22   -   49   (39)  49 Total noninterest income 3,935   4,162   3,999   3,960   3,716   8,097   7,662 Noninterest Expense             Salaries and wages 7,567   7,878   7,020   7,713   7,589   15,445   15,435 Employee benefits 2,265   2,404   2,148   2,112   2,112   4,669   4,283 Net occupancy expense 1,075   1,199   1,072   1,054   999   2,274   2,026 Furniture and equipment 1,414   1,278   1,032   1,472   1,407   2,692   2,760 Data processing 1,057   557   160   339   448   1,614   948 Franchise taxes 397   397   312   410   265   794   820 ATM expense 761   491   328   472   397   1,252   870 Advertising 356   503   498   597   519   859   1,049 FDIC assessment 448   465   505   516   507   913   1,087 Servicing rights amortization - net 234   127   244   219   187   361   355 Loan expense 328   228   236   244   251   556   480 Consulting fees 494   745   242   251   198   1,239   384 Professional fees 502   559   368   453   527   1,061   972 Intangible asset amortization 444   445   446   445   444   889   889 Other general and administrative 1,918   1,484   1,465   1,128   1,495   3,402   2,828 Total noninterest expense 19,260   18,760   16,076   17,425   17,345   38,020   35,186 Income Before Income Taxes 9,698   8,760   10,527   8,109   7,159   18,458   13,937 Income Taxes 1,988   1,808   2,146   1,593   1,477   3,796   2,896 Net Income 7,710   6,952   8,381   6,516   5,682   14,662   11,041 Other Comprehensive Income (Loss) (Net of Tax):             Net unrealized gain (loss) on available-for-sale securities 1,149   6,464   (7,403)  11,664   2,531   7,613   536 Reclassification adjustment for realized (gain) loss on sale of available-for-sale securities -   -   -   -   -   -   - Net unrealized gain (loss) on available-for-sale securities 1,149   6,464   (7,403)  11,664   2,531   7,613   536 Tax expense (benefit) 241   1,358   (1,554)  2,449   531   1,599   113 Other comprehensive income (loss) 908   5,106   (5,849)  9,215   2,000   6,014   423 Comprehensive Income$8,618  $12,058  $2,532  $15,731  $7,682  $20,676  $11,464 Basic Earnings Per Share$0.56  $0.51  $0.61  $0.48  $0.42  $1.07  $0.81 Diluted Earnings Per Share$0.56  $0.51  $0.61  $0.48  $0.42  $1.07  $0.81 Dividends Declared$0.22125  $0.22125  $0.22125  $0.22125  $0.22000  $0.44250  $0.44000                FARMERS & MERCHANTS BANCORP, INC. AND SUBSIDIARIESCONDENSED CONSOLIDATED BALANCE SHEETS(Unaudited) (in thousands of dollars, except share data)   June 30, 2025 March 31, 2025 December 31, 2024 September 30, 2024 June 30, 2024  (Unaudited) (Unaudited)   (Unaudited) (Unaudited)Assets          Cash and due from banks$87,596  $172,612  $174,855  $244,572  $191,785 Federal funds sold 635   425   1,496   932   1,283 Total cash and cash equivalents 88,231   173,037   176,351   245,504   193,068            Interest-bearing time deposits 1,992   1,992   2,482   2,727   3,221 Securities - available-for-sale 431,102   438,568   426,556   404,881   365,209 Other securities, at cost 13,994   14,062   14,400   15,028   14,721 Loans held for sale 6,359   2,331   2,996   1,706   1,628 Loans, net of allowance for credit losses 2,599,917   2,555,552   2,536,043   2,512,852   2,534,468 Premises and equipment 32,885   33,163   33,828   33,779   34,507 Construction in progress -   -   -   35   38 Goodwill 86,358   86,358   86,358   86,358   86,358 Loan servicing rights 5,810   5,805   5,656   5,644   5,504 Bank owned life insurance 35,355   35,116   34,872   34,624   34,359 Other assets 43,760   42,802   45,181   46,047   49,552            Total Assets$3,345,763  $3,388,786  $3,364,723  $3,389,185  $3,322,633            Liabilities and Stockholders' Equity         Liabilities         Deposits         Noninterest-bearing$497,804  $502,318  $516,904  $481,444  $479,069 Interest-bearing         NOW accounts 899,602   874,881   850,462   865,617   821,145 Savings 691,468   696,635   671,818   661,565   673,284 Time 621,455   626,450   647,581   676,187   667,592  Total deposits 2,710,329   2,700,284   2,686,765   2,684,813   2,641,090            Federal funds purchased and securities sold under agreements to repurchase 27,562   27,258   27,218   27,292   27,218 Federal Home Loan Bank (FHLB) advances 188,445   245,474   246,056   263,081   266,102 Subordinated notes, net of unamortized issuance costs 34,875   34,846   34,818   34,789   34,759 Dividend payable 3,000   2,997   2,996   2,998   2,975 Accrued expenses and other liabilities 30,760   33,326   31,659   40,832   27,825  Total liabilities 2,994,971   3,044,185   3,029,512   3,053,805   2,999,969            Commitments and Contingencies                    Stockholders' Equity         Common stock - No par value authorized 40,000,000 shares at 6/30/25 and 20,000,000 shares at 12/31/24; issued 14,564,425 shares 6/30/25 and 12/31/24; outstanding 13,725,998 shares 6/30/25 and 13,699,536 shares 12/31/24 135,805   135,407   135,565   135,193   135,829 Treasury stock - 838,427 shares 6/30/25 and 864,889 shares 12/31/24 (10,674)  (10,768)  (10,985)  (10,904)  (11,006)Retained earnings 244,870   240,079   235,854   230,465   226,430 Accumulated other comprehensive loss (19,209)  (20,117)  (25,223)  (19,374)  (28,589) Total stockholders' equity 350,792   344,601   335,211   335,380   322,664            Total Liabilities and Stockholders' Equity$3,345,763  $3,388,786  $3,364,723  $3,389,185  $3,322,633             FARMERS & MERCHANTS BANCORP, INC. AND SUBSIDIARIESSELECT FINANCIAL DATA                        For the Three Months Ended For the Six Months EndedSelected financial data June 30, 2025 March 31, 2025 December 31, 2024 September 30, 2024 June 30, 2024 June 30, 2025 June 30, 2024Return on average assets  0.92%  0.85%  0.99%  0.78%  0.69%  0.88%  0.67%Return on average equity  8.88%  8.31%  10.00%  7.93%  7.13%  8.55%  6.94%Yield on earning assets  5.45%  5.19%  5.20%  5.27%  5.22%  5.32%  5.11%Cost of interest bearing liabilities  2.83%  2.76%  3.01%  3.21%  3.18%  2.84%  3.12%Net interest spread  2.62%  2.43%  2.19%  2.06%  2.04%  2.48%  1.99%Net interest margin  3.22%  3.03%  2.84%  2.71%  2.71%  3.13%  2.66%Efficiency ratio  64.93%  66.79%  59.82%  67.98%  69.03%  65.84%  71.50%Dividend payout ratio  38.91%  43.10%  35.75%  45.99%  52.35%  40.90%  53.89%Tangible book value per share $18.91  $18.44  $17.74  $17.72  $16.79       Tier 1 leverage ratio  8.50%  8.44%  8.12%  8.04%  8.02%      Average shares outstanding  13,720,339   13,706,003   13,699,869   13,687,119   13,681,501   13,713,211   13,676,333                       Loans June 30, 2025 March 31, 2025 December 31, 2024 September 30, 2024 June 30, 2024      (Dollar amounts in thousands)                     Commercial real estate $1,345,953  $1,325,698  $1,310,811  $1,301,160  $1,303,598       Agricultural real estate  221,004   215,898   216,401   220,328   222,558       Consumer real estate  523,781   523,383   520,114   524,055   525,902       Commercial and industrial  293,826   278,254   275,152   260,732   268,426       Agricultural  157,870   153,607   152,080   137,252   142,909       Consumer  59,348   60,115   63,009   67,394   70,918       Other  24,653   24,985   24,978   25,916   26,449       Less: Net deferred loan fees, costs and other (1)  459   (36)  (676)  1,499   (1,022)      Total loans, net $2,626,894  $2,581,904  $2,561,869  $2,538,336  $2,559,738                                                   Asset quality data June 30, 2025 March 31, 2025 December 31, 2024 September 30, 2024 June 30, 2024      (Dollar amounts in thousands)                     Nonaccrual loans $3,745  $4,494  $3,124  $2,898  $2,487       90 day past due and accruing $-  $-  $-  $-  $-       Nonperforming loans $3,745  $4,494  $3,124  $2,898  $2,487       Other real estate owned $-  $-  $-  $-  $-       Nonperforming assets $3,745  $4,494  $3,124  $2,898  $2,487                                                   Allowance for credit losses - loans $26,977  $26,352  $25,826  $25,484  $25,270       Allowance for credit losses - off balance sheet credit exposures  1,308   1,281   1,541   1,661   1,928       Total allowance for credit losses $28,285  $27,633  $27,367  $27,145  $27,198       Total allowance for credit losses/total loans  1.08%  1.07%  1.07%  1.07%  1.06%      Adjusted credit losses with accretable yield/total loans  1.07%  1.08%  1.08%  1.10%  1.10%      Net charge-offs:                     Quarter-to-date $36  $285  $4  $68  $15       Year-to-date $321  $285  $142  $138  $70       Net charge-offs to average loans                     Quarter-to-date  0.00%  0.01%  0.00%  0.00%  0.00%      Year-to-date  0.01%  0.01%  0.01%  0.01%  0.00%      Nonperforming loans/total loans  0.14%  0.17%  0.12%  0.11%  0.10%      Allowance for credit losses/nonperforming loans  720.35%  586.38%  826.70%  879.37%  1016.08%      NPA coverage ratio  720.35%  586.38%  826.70%  879.37%  1016.08%                            (1) Includes carrying value adjustments of $1.9 million as of June 30, 2025, $1.7 million as of March 31, 2025, $1.1 million as of December 31, 2024, $3.0 million as of September 30, 2024, and $612 thousand as of June 30, 2024 related to interest rate swaps associated with fixed rate loans                       FARMERS & MERCHANTS BANCORP, INC. AND SUBSIDIARIESAVERAGE 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, 2025 June 30, 2024Interest Earning Assets:Average Balance Interest/Dividends Annualized Yield/Rate Average Balance Interest/Dividends Annualized Yield/RateLoans$2,617,278  $39,530   6.04% $2,556,417  $36,593   5.73%Taxable investment securities 459,298   2,837   2.47%  391,439   1,782   1.82%Tax-exempt investment securities 16,682   74   2.25%  20,907   82   1.99%Fed funds sold & other 99,964   1,051   4.21%  187,682   2,709   5.77%Total Interest Earning Assets 3,193,222  $43,492   5.45%  3,156,445  $41,166   5.22%            Nonearning Assets 175,969       156,239                 Total Assets$3,369,191      $3,312,684                 Interest Bearing Liabilities:           NOW accounts and savings deposits$1,599,067  $9,479   2.37% $1,492,831  $10,193   2.73%Time deposits 626,036   5,334   3.41%  668,583   6,295   3.77%Other borrowed money 228,708   2,411   4.22%  265,229   2,742   4.14%Fed funds purchased & securities sold under agreement to repurchase 27,301   272   3.99%  27,721   276   3.98%Subordinated notes 34,856   285   3.27%  34,740   285   3.28%Total Interest Bearing Liabilities$2,515,968  $17,781   2.83% $2,489,104  $19,791   3.18%            Noninterest Bearing Liabilities 505,129       504,821                 Stockholders' Equity$348,094      $318,759                 Net Interest Income and Interest Rate Spread  $25,711   2.62%   $21,375   2.04%            Net Interest Margin     3.22%      2.71%            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, 2025 June 30, 2024Interest Earning Assets:Average Balance Interest/Dividends Annualized Yield/Rate Average Balance Interest/Dividends Annualized Yield/RateLoans$2,598,011  $76,602   5.90% $2,566,765  $71,793   5.60%Taxable investment securities 458,903   5,576   2.43%  388,225   3,468   1.79%Tax-exempt investment securities 17,501   152   2.20%  21,196   168   2.01%Fed funds sold & other 102,851   2,164   4.21%  149,035   4,391   5.89%Total Interest Earning Assets 3,177,266  $84,494   5.32%  3,125,221  $79,820   5.11%            Nonearning Assets 171,324       157,510                 Total Assets$3,348,590      $3,282,731                 Interest Bearing Liabilities:           NOW accounts and savings deposits$1,524,965  $18,043   2.37% $1,467,669  $19,600   2.67%Time deposits 626,767   10,758   3.43%  659,581   12,167   3.69%Other borrowed money 237,185   4,961   4.18%  264,217   5,431   4.11%Fed funds purchased & securities sold under agreement to repurchase 27,391   543   3.96%  28,089   560   3.99%Subordinated notes 34,842   569   3.27%  34,726   569   3.28%Total Interest Bearing Liabilities$2,451,150  $34,874   2.84% $2,454,282  $38,327   3.12%            Noninterest Bearing Liabilities 553,686       510,453                 Stockholders' Equity$343,754      $317,996                 Net Interest Income and Interest Rate Spread  $49,620   2.48%   $41,493   1.99%            Net Interest Margin     3.13%      2.66%            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 SUBSIDIARIESAVERAGE BALANCE SHEETS AND RELATED YIELDS AND RATES(in thousands of dollars, except percentages)                   For the Three Months Ended June 30, 2025 For the Three Months Ended June 30, 2024 As Reported Excluding Acc/AmortDifference As Reported Excluding Acc/AmortDifference $Yield $Yield $Yield $Yield $Yield $YieldInterest Earning Assets:                 Loans$39,530  6.04% $38,928  5.95% $602  0.09% $36,593  5.73% $35,914  5.62% $679  0.11%Taxable investment securities 2,837  2.47%  2,837  2.47%  -  0.00%  1,782  1.82%  1,782  1.82%  -  0.00%Tax-exempt investment securities 74  2.25%  74  2.25%  -  0.00%  82  1.99%  82  1.99%  -  0.00%Fed funds sold & other 1,051  4.21%  1,051  4.21%  -  0.00%  2,709  5.77%  2,709  5.77%  -  0.00%Total Interest Earning Assets 43,492  5.45%  42,890  5.38%  602  0.07%  41,166  5.22%  40,487  5.13%  679  0.09%                  Interest Bearing Liabilities:                 NOW accounts and savings deposits$9,479  2.37% $9,479  2.37% $-  0.00% $10,193  2.73% $10,193  2.73% $-  0.00%Time deposits 5,334  3.41%  5,334  3.41%  -  0.00%  6,295  3.77%  6,295  3.77%  -  0.00%Other borrowed money 2,411  4.22%  2,407  4.21%  4  0.01%  2,742  4.14%  2,747  4.14%  (5) 0.00%Federal funds purchased and securities sold under agreement to repurchase 272  3.99%  272  3.99%  -  0.00%  276  3.98%  276  3.98%  -  0.00%Subordinated notes 285  3.27%  285  3.27%  -  0.00%  285  3.28%  285  3.28%  -  0.00%Total Interest Bearing Liabilities 17,781  2.83%  17,777  2.83%  4  0.00%  19,791  3.18%  19,796  3.18%  (5) 0.00%                  Interest/Dividend income/yield 43,492  5.45%  42,890  5.38%  602  0.07%  41,166  5.22%  40,487  5.13%  679  0.09%Interest Expense / yield 17,781  2.83%  17,777  2.83%  4  0.00%  19,791  3.18%  19,796  3.18%  (5) 0.00%Net Interest Spread 25,711  2.62%  25,113  2.55%  598  0.07%  21,375  2.04%  20,691  1.95%  684  0.09%Net Interest Margin  3.22%   3.15%   0.07%   2.71%   2.62%   0.09%                   For the Six Months Ended June 30, 2025 For the Six Months Ended June 30, 2024 As Reported Excluding Acc/AmortDifference As Reported Excluding Acc/AmortDifference $Yield $Yield $Yield $Yield $Yield $YieldInterest Earning Assets:                 Loans$76,602  5.90% $75,396  5.80% $1,206  0.10% $71,793  5.60% $70,439  5.49% $1,354  0.11%Taxable investment securities 5,576  2.43%  5,576  2.43%  -  0.00%  3,468  1.79%  3,468  1.79%  -  0.00%Tax-exempt investment securities 152  2.20%  152  2.20%  -  0.00%  168  2.01%  168  2.01%  -  0.00%Fed funds sold & other 2,164  4.21%  2,164  4.21%  -  0.00%  4,391  5.89%  4,391  5.89%  -  0.00%Total Interest Earning Assets 84,494  5.32%  83,288  5.25%  1,206  0.07%  79,820  5.11%  78,466  5.03%  1,354  0.08%                  Interest Bearing Liabilities:                 NOW accounts and savings deposits$18,043  2.37% $18,043  2.37% $-  0.00% $19,600  2.67% $19,600  2.67% $-  0.00%Time deposits 10,758  3.43%  10,758  3.43%  -  0.00%  12,167  3.69%  12,167  3.69%  -  0.00%Other borrowed money 4,961  4.18%  4,954  4.18%  7  0.00%  5,431  4.11%  5,454  4.13%  (23) -0.02%Federal funds purchased and securities sold under agreement to repurchase 543  3.96%  543  3.96%  -  0.00%  560  3.99%  560  3.99%  -  0.00%Subordinated notes 569  3.27%  569  3.27%  -  0.00%  569  3.28%  569  3.28%  -  0.00%Total Interest Bearing Liabilities 34,874  2.84%  34,867  2.85%  7  -0.01%  38,327  3.12%  38,350  3.13%  (23) -0.01%                  Interest/Dividend income/yield 84,494  5.32%  83,288  5.25%  1,206  0.07%  79,820  5.11%  78,466  5.03%  1,354  0.08%Interest Expense / yield 34,874  2.84%  34,867  2.85%  7  -0.01%  38,327  3.12%  38,350  3.13%  (23) -0.01%Net Interest Spread 49,620  2.48%  48,421  2.40%  1,199  0.08%  41,493  1.99%  40,116  1.90%  1,377  0.09%Net Interest Margin  3.13%   3.05%   0.08%   2.66%   2.57%   0.09%                   Company Contact:Lars B. EllerPresident and Chief Executive Officer Farmers & Merchants Bancorp, Inc.(419) 446-2501 leller@fm.bankInvestor and Media Contact:  Andrew M. BergerManaging DirectorSM Berger & Company, Inc. (216) 464-6400andrew@smberger.com  

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