F&M Bank Corp. Reports Q2 2025 Net Income of $2.97 Million, First Half Income Up to $5.42 Million

F&M Bank Corp. reported its financial results for the second quarter and first half of 2025, revealing a net income of $2.97 million, or $0.84 per share, for the three months ended June 30, 2025, a slight decrease from $3.01 million, or $0.86 per share, in the same period of 2024. The return on average assets was 0.91%, and the return on average equity was 12.81%, down from 0.93% and 15.58%, respectively, in the prior year. The decrease in net income was attributed to a $2.3 million increase in net interest income, offset by a $1.6 million increase in the provision for credit losses, a $206,000 decline in noninterest income, and a $542,000 rise in noninterest expenses.

For the first half of 2025, net income increased to $5.42 million, or $1.53 per share, compared to $4.23 million, or $1.21 per share, in the same period of 2024. This increase was driven by a $3.6 million rise in net interest income and a $305,000 increase in noninterest income, despite a $717,000 increase in the provision for credit losses and a $1.6 million rise in noninterest expenses. The net interest margin improved to 3.32%, up from 2.72% in the prior year, reflecting a favorable shift in the composition of earning assets and a decrease in interest expense.

The company’s total assets reached $1.31 billion as of June 30, 2025, marking a $9.9 million increase from December 31, 2024. This growth was primarily driven by an $8.8 million increase in loans held for investment, which totaled $848.8 million, and a $12.4 million rise in securities available for sale, which amounted to $340 million. The composition of the loan portfolio shifted, with a notable increase in loans secured by farmland and a decrease in indirect automobile loans. Total deposits increased slightly to $1.20 billion, with noninterest-bearing deposits rising by $18 million, while interest-bearing deposits decreased by $16.7 million.

Operationally, the company experienced a decrease in noninterest income, primarily due to a decline in mortgage banking income, which was partially offset by increases in title insurance income and card services. Noninterest expenses rose due to higher salaries and employee benefits, as well as increased data processing costs. The provision for credit losses increased significantly, reflecting a more cautious outlook on credit quality amid changing economic conditions. The allowance for credit losses stood at $8.31 million, representing 0.98% of total loans.

Looking ahead, F&M Bank Corp. remains focused on managing its interest rate risk and maintaining adequate liquidity. The company has access to various funding sources, including lines of credit with the Federal Home Loan Bank and the Federal Reserve. Management believes that the current capital ratios exceed regulatory requirements, positioning the bank well for future growth and stability. The company continues to monitor market conditions and adjust its strategies accordingly to navigate potential challenges in the economic landscape.