Farmers & Merchants Bancorp reported a net income of $23.7 million for the third quarter of 2025, reflecting a 7.2% increase from $22.1 million in the same period last year. For the nine months ending September 30, 2025, net income reached $69.8 million, up 4.8% from $66.6 million in 2024. The growth in net income was primarily driven by a $3.4 million increase in net interest income, which totaled $55.4 million for the quarter, compared to $52.0 million in the prior year. The bank's net interest margin improved to 4.16% from 4.07% year-over-year, aided by a decrease in interest expenses on deposits.
Total assets for Farmers & Merchants Bancorp increased to $5.6 billion as of September 30, 2025, up from $5.4 billion at the end of 2024. This growth was supported by a significant rise in the investment portfolio, which grew by 30.1% to $1.6 billion, while gross loans and leases decreased slightly to $3.6 billion from $3.7 billion. Total deposits also saw an increase, rising to $4.9 billion, a 3.96% increase from $4.7 billion at the end of the previous year. The bank's loan-to-deposit ratio stood at 74.16%, down from 78.87% at the end of 2024.
In terms of operational metrics, the bank's provision for credit losses was $700,000 for the third quarter, compared to no provision in the same quarter of 2024. The allowance for credit losses on loans and leases was $75.9 million, representing 2.10% of total loans. Non-performing loans totaled $955,000, consistent with the previous year, while other real estate owned remained stable at $873,000. The bank's capital position improved, with total shareholders' equity increasing to $645.3 million, a 12.6% rise from $573.1 million at the end of 2024.
Looking ahead, Farmers & Merchants Bancorp anticipates continued growth in net interest income, supported by a favorable interest rate environment and strategic management of its asset-liability mix. The bank remains focused on maintaining a strong liquidity position, with total available liquidity at $3.1 billion as of September 30, 2025. The management is committed to enhancing shareholder value through prudent financial practices, including a recent shift to quarterly dividend payments and an ongoing share repurchase program, which has $57.1 million remaining for future repurchases.
About FARMERS & MERCHANTS BANCORP
Farmers & Merchants Bancorp is a bank holding company that operates through its wholly-owned subsidiary, Farmers & Merchants Bank of Central California. It provides a range of banking services, including deposit products, commercial and consumer loans, and investment services, primarily serving small to medium-sized businesses and local consumers in California's Central Valley and Bay Area markets. The company emphasizes personalized service, relationship banking, and community-focused financial solutions.
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