Farmers and Merchants Bancshares Reports $844.6 Million in Assets and $4.3 Million Net Income for 2024

Farmers and Merchants Bancshares, Inc. reported a consolidated asset total of approximately $844.6 million as of December 31, 2024, reflecting a 5.6% increase from $799.9 million in the previous year. The growth was primarily driven by a $59.7 million increase in loans, which rose to $583.0 million, and a $20.0 million increase in cash and cash equivalents. However, the company experienced a decrease in its investment securities, which fell by $38.0 million to $146.2 million. Total liabilities also increased by 5.4% to $788.4 million, largely due to a $77.8 million rise in deposits, while stockholders' equity grew by 7.8% to $56.3 million, supported by net income of $4.3 million for the year.

In terms of profitability, Farmers and Merchants Bancshares reported a net income of $4.3 million for 2024, down from $6.4 million in 2023. This decline was attributed to a decrease in net interest income, which fell by $0.6 million, an increase in the provision for credit losses of $0.7 million, and a rise in noninterest expenses by $1.8 million. The company’s net interest income was $20.8 million, down from $21.4 million, as the cost of interest-bearing liabilities increased significantly due to Federal Reserve rate hikes. Total interest income, however, rose to $38.4 million, up from $31.3 million, driven by higher average interest-earning assets and increased yields.

Operationally, the bank's loan portfolio saw significant growth, particularly in commercial real estate and commercial loans, which increased by $36.2 million and $17.6 million, respectively. The company attributed this growth to the addition of new lending staff and stabilizing interest rates. As of December 31, 2024, the bank had approximately 19,400 deposit accounts, with total deposits reaching $758.8 million. The bank's allowance for credit losses remained stable at $4.3 million, representing 0.72% of total loans, while non-accrual loans increased to $2.4 million from $655,000 in the previous year.

Strategically, Farmers and Merchants Bancshares has focused on enhancing its operational capabilities, including the opening of a new office in Towson, Maryland, which contributed to increased occupancy costs. The company has also engaged in various initiatives to improve its risk management practices, particularly in relation to credit risk associated with its loan portfolio. Looking ahead, the company plans to continue leveraging its community banking model while navigating the challenges posed by regulatory changes and market conditions. Management remains optimistic about future growth opportunities, particularly in light of the bank's strong capital position and commitment to serving its local communities.