F&M Bank Corp 8-K, filed Jan 31, 2020
F&M Bank Corp (FMBM)
8-K
2020-01-31
For: 2020-01-31
View Original
Added on
April 06, 2026
About this 8-K
F&M Bank Corp filed this 8-K on January 31, 2020.
Items reported
- Item 2.02: Financial results
- Item 9.01: Financial statements and exhibits
UNITED
STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
___________
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act
of 1934
Date of Report (Date of earliest event
reported): January 31,
2020
___________
F & M Bank Corp.
(Exact
name of registrant as specified in its charter)
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Virginia
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000-13273
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54-1280811
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(State or other
jurisdiction of
incorporation)
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(Commission File
Number)
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(IRS
Employer Identification
No.)
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P.O. Box
1111Timberville, Virginia
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22853
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(Address of
principal executive offices)
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(Zip
Code)
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Registrant’s
telephone number, including area code: (540) 896-8941
Not
Applicable
(Former
name or former address, if changed since last report)
Check
the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant
under any of the following provisions:
☐
Written
communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
☐
Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
☐
Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17
CFR 240.14d-2(b))
☐
Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17
CFR 240.13e-4(c))
Item 2.02.
Results
of Operations and Financial Condition.
On
January 31, 2020, F & M Bank Corp. (the “Company”)
issued a press release announcing results for the year ended
December 31, 2019. A copy of the press release is attached as
Exhibit 99.1.
The information in this Form 8-K, and the exhibit hereto, is being
furnished and shall not be deemed “filed” for purposes
of Section 18 of the Securities Exchange Act of 1934, as amended,
nor shall it be deemed incorporated by reference in any filing
under the Securities Act of 1933, as amended, except as shall be
expressly set forth by specific reference in such
filing.
Item 9.01.
Financial Statements and Exhibits.
(d)
Exhibits.
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Exhibit
No.
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Description
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Press
Release dated January 31, 2020
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SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
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F & M Bank Corp. |
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Date:
January 31, 2020
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By:
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/s/ Carrie
A. Comer
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Carrie
A. Comer
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Executive
Vice President and Chief Financial Officer
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EXHIBIT
INDEX
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Exhibit
No.
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Description
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Press
Release dated January 31, 2020
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Exhibit
99.1
F & M Bank Corp.---News and Financials
F & M BANK CORP. ANNOUNCES EARNINGS
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CONTACT:
Carrie Comer, EVP/Chief
Financial Officer
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540-896-8941 or ccomer@FMBankVA.com
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TIMBERVILLE,
VA—January 31, 2020—F & M Bank Corp. (OTCQX: FMBM),
parent company of Farmers & Merchants Bank, announces its
financial results for the fourth quarter and year ended December
31, 2019.
Selected
highlights for the quarter and year to date include:
●
Net
income of $1.9 million and $4.6 million, respectively;
●
Non-performing
assets decreased $2.43 million during the fourth quarter and $5.43
million year to date;
●
Net
interest margin 3.81% and 4.33%. respectively;
●
Total
deposits increased $23.3 million and $50.4 million, respectively
for the quarter and year to date.
Mark Hanna, President, commented,
“We
are pleased to announce fourth quarter and year-to-date earnings of
$1.9 million and $4.6 million, respectively. Although these results
are lower than prior year, we made great progress in positioning
F&M Bank for continued success by substantially reducing our
Non-performing assets and growing Core deposit relationships. It is
important to note that Fourth Quarter earnings were reduced by
several non-recurring items related to dealer deferred cost
amortization, pension costs and severance benefits. Our margin
decreased as a result of lower loan balances due primarily to sales
of indirect dealer loans which occurred during the second half of
the year and unrecognized dealer loan costs. Our provision for loan
losses increased in 2019 due to higher levels of substandard loans
and identification of problem credits. We feel the allowance for
loan losses reflects the current risk in our loan portfolio. As we
push into 2020, we feel that we are well positioned to leverage our
surplus liquidity with organic loan growth and continued
improvement in reducing our funding costs.
Hanna continued, “During the fourth
quarter we made significant progress in addressing our problem
assets. Previously we had announced that two large loans were
placed on non-accrual during the second quarter, resulting in our
significant allowance for loan loss funding in the first half of
the year. During the fourth quarter we were successful in
collecting on one of these loans and we recognized a partial
write-down on the other based on the appraised value and continued
payment delinquency. As a result of these and other collection
efforts our problem assets decreased from $17.3 million to $12.6
million.” Highlights of
our financial performance are included below.
Restatement
of 2018 Financial Statements: In November 2019, as a result of the
sale of a portion of the Bank’s indirect dealer loan
accounts, management discovered a system input error that prevented
the deferred costs associated with dealer loans originated after a
certain date from amortizing properly. This error in accounting
resulted in a restatement of calendar year 2018 earnings of
$261,728, net of tax and a correction of $248,090, net of tax for
years prior to 2018 which is reflected as a reduction to retained
earnings in the restated 2018 consolidated financial statements.
The 2019 earnings properly reflect the amortization, which resulted
in reduction of earnings of $184,890, net of tax.
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
fourteen 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, VBS Mortgage, LLC (DBA F&M
Mortgage) and VSTitle, LLC 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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2019
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2018
(restated)
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Q4
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Q3
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Q2
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Q1
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YTD
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YTD
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Net
Income (000's)
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$1,879
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$(186)
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$1,634
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$1,287
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$4,614
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$8,823
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Net
Income available to Common
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$1,800
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$(265)
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$1,556
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$1,208
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$4,299
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$8,410
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Earnings
per common share - basic
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$0.57
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$(0.08)
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$0.48
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$0.38
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$1.35
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$2.60
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Earnings
per common share - diluted
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1.33
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2.45
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Return
on Average Assets
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0.92%
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-0.09%
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0.83%
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0.67%
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0.58%
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1.15%
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Return
on Average Equity
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8.18%
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-0.81%
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7.12%
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5.68%
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5.04%
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9.67%
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Dividend
Payout Ratio excluding Special Dividend
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45.61%
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-325.00%
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52.08%
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65.79%
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75.56%
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38.46%
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Dividend
Payout Ratio with Special Dividend
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46.15%
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Net
Interest Margin
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3.81%
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4.39%
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4.47%
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4.67%
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4.33%
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4.65%
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Yield
on Average Earning Assets
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4.77%
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5.35%
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5.42%
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5.54%
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5.27%
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5.35%
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Yield
on Average Interest Bearing Liabilities
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1.33%
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1.34%
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1.33%
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1.21%
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1.30%
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1.02%
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Net
Interest Spread
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3.44%
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4.01%
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4.09%
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4.33%
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3.97%
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4.33%
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Provision
for Loan Losses (000's)
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$605
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$3,750
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$1,600
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$1,450
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$7,405
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$2,930
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Net
Charge-offs
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$1,198
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$817
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$483
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$1,757
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$4,255
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$3,735
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Net
Charge-offs as a % of Loans
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0.79%
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0.52%
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0.30%
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1.09%
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0.71%
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0.58%
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Non-Performing
Loans (000's)
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$5,728
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$7,978
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$11,688
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$10,587
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$5,728
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$10,205
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Non-Performing
Loans to Total Assets
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0.70%
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0.98%
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1.45%
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1.36%
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0.70%
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1.31%
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Non-Performing
Assets (000's)
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$7,217
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$9,649
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$13,657
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$12,761
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$7,217
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$12,648
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Non-Performing
Assets to Assets
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0.89%
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1.19%
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1.69%
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1.64%
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0.89%
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1.62%
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Efficiency
Ratio
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74.97%
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67.63%
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65.32%
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67.15%
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68.73%
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66.04%
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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 services 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 investment
portfolio. 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 Twelve
Months
Ended December
31,
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INCOME
STATEMENT
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Unaudited
2019
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2018*
(restated)
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Interest and
Dividend Income
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$38,210,304
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$36,376,657
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Interest
Expense
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6,818,488
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4,832,063
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Net Interest
Income
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31,391,816
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31,544,594
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Non-Interest
Income
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9,919,954
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8,003,003
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Provision for Loan
Losses
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7,405,000
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2,930,000
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Other Non-Interest
Expenses
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29,392,237
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26,743,762
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Income Before
Income Taxes
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4,514,533
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9,873,835
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(Benefit of)
provision for Income Taxes
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(229,340)
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1,040,596
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Less Minority
Interest income
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130,276
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10,050
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Net
Income
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$4,613,597
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$8,823,189
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Dividend on
preferred stock
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314,589
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413,191
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Net Income
available to common shareholders
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$4,299,008
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$8,409,998
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Average Common
Shares Outstanding
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3,189,288
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3,238,177
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Net Income Per
Common Share – Basic
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1.35
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2.60
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Net Income Per
Common Share – Diluted
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1.33
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2.45
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Dividends
Declared
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1.02
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1.20
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BALANCE
SHEET
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Unaudited
December 31,
2019
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Audited
December 31,
2018
(restated)
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Cash and Due from
Banks
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$8,118,889
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$9,521,741
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Interest Bearing
Bank Deposits
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1,125,616
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1,390,181
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Federal Funds
Sold
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66,559,096
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-
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Loans
Held for Sale
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66,798,436
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55,909,812
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Loans
Held for Investment
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603,425,471
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638,798,885
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Less
Allowance for Loan Losses
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(8,389,846)
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(5,239,699)
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Net
Loans Held for Investment
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595,035,625
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633,559,186
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Securities
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18,015,488
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21,843,918
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Other
Assets
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58,324,549
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57,518,624
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Total
Assets
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$813,977,699
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Deposits
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$641,709,480
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$591,325,319
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Short Term
Debt
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10,000,000
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40,116,000
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Long Term
Debt
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53,200,675
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40,218,073
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Other
Liabilities
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17,387,561
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16,682,537
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Total
Liabilities
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722,297,716
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688,341,929
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Stockholders’
Equity
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91,679,983
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91,401,533
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Total
Liabilities and Stockholders’ Equity
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$813,977,699
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$779,743,462
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Book Value Per
Common Share
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$27.14
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$26.68
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Tangible Book Value
Per Common Share
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$26.98
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$26.75
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*Derived from
audited consolidated financial statements, as restated
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SOURCE:
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F
& M Bank Corp.
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CONTACT:
|
Carrie
Comer, EVP/Chief Financial Officer
540-896-8941
or ccomer@FMBankVA.com
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3