F&M Bank Corp. Reports $2.5 Million Net Income for Q1 2025, Up from $1.2 Million Last Year

F&M Bank Corp. reported a net income of $2.5 million, or $0.70 per share, for the first quarter of 2025, marking a significant increase from the $1.2 million, or $0.35 per share, recorded in the same period last year. This improvement in profitability is attributed to a reduction in total interest expenses following the redemption of short-term debt and a recovery in the provision for credit losses, which amounted to a recovery of $104,000 compared to a provision of $823,000 in the prior year. The bank's return on average assets and return on average equity also improved to 0.76% and 11.31%, respectively.

Total assets for F&M Bank Corp. stood at $1.31 billion as of March 31, 2025, a slight decrease of $10.1 million from the end of 2024. The bank's loan portfolio decreased by $12.9 million to $827 million, with notable declines in commercial and industrial loans and automobile loans. However, there were increases in real estate loans and loans secured by farmland. The bank's total deposits grew by $4.9 million to $1.2 billion, driven by an increase in noninterest-bearing deposits, while interest-bearing deposits saw a decline.

In terms of operational metrics, the bank's net interest income rose to $9.4 million, up from $8.1 million in the previous year, primarily due to higher interest income driven by increased interest rates. The net interest margin improved to 3.15%, reflecting a 45 basis point increase from the prior year. Noninterest income also saw a boost, totaling $2.8 million, an increase of $513,000, with contributions from mortgage banking, wealth management, and title insurance services.

F&M Bank Corp. continues to maintain a strong capital position, with total shareholders' equity increasing to $91.3 million as of March 31, 2025, compared to $86.1 million at the end of 2024. The bank's allowance for credit losses was $7.8 million, or 0.94% of gross loans, reflecting a slight decrease from the previous quarter. The bank's nonaccrual loans increased to $8.9 million, up from $7.0 million, indicating a need for ongoing monitoring of asset quality.

Looking ahead, F&M Bank Corp. remains focused on managing its interest rate risk and maintaining liquidity. The bank has access to various funding sources, including federal funds lines and a secured line of credit with the Federal Home Loan Bank. Management believes that the current liquidity position is sufficient to meet depositors' needs and support future loan growth, while also navigating the challenges posed by rising interest rates and market conditions.