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Farmers & Merchants Bank of Long Beach (“F&M” or the “Bank”) (OTCQX: FMBL) today reported financial results for the third quarter and nine-months ended September 30, 2025. F&M also announced that its Board of Directors has authorized a new $10 million stock repurchase program.

“F&M’s third-quarter performance underscores the strength and stability that define our brand,” said W. Henry Walker, Chief Executive Officer. “We continue to benefit from a loyal and stable deposit base, along with a conservative approach to lending that has served our clients, shareholders, and communities well through a range of economic cycles. The consistency of our results reflects a culture focused on sound banking fundamentals and long-term relationships. We reported measurable improvements in net interest margin and net income for the third quarter, with all of F&M’s capital ratios well in excess of regulatory requirements for a ‘well-capitalized’ financial institution. Subsequent to the close of the third quarter, we were gratified to have closed on a $200 million equity investment in the Bank by a large financial services company that purchased 16,261 shares of non-voting Series A Preferred Stock, which is the economic equivalent of the Bank’s common stock.”

Daniel Walker, F&M’s Executive Chairman, added, “The operating environment for regional banks is beginning to show some signs of balance, as inflation trends ease and the pace of rate cuts is coming into clearer focus. While we remain cautious about the timing and shape of economic normalization and how it will impact F&M, the recent equity investment in the Bank further enhances our already strong balance sheet, and we are optimistic about the long-term opportunities for us to further grow our franchise and deliver sustainable value for all of our stakeholders. Our commitment to prudent growth, operational excellence, and enhanced shareholder value remains unwavering.”

Operating Results

For the third quarter of 2025, total interest and dividend income amounted to $109.1 million, compared with $113.6 million in the third quarter of 2024. Total interest and dividend income for the nine months ended September 30, 2025 amounted to $318.9 million, compared with $330.9 million reported for the nine months ended September 30, 2024.

Total interest expense for the third quarter of 2025 was $39.9 million, compared with $53.2 million a year ago. Interest expense for the nine months ended September 30, 2025 was $118.6 million, compared to $156.0 million reported for the same period in 2024.

Net interest income before provision for credit losses for the third quarter of 2025 rose to $69.3 million, from $60.4 million for the third quarter of 2024. Net interest income before provision for credit losses for the nine months ended September 30, 2025 was $200.3 million, compared with $174.9 million for the nine months ended September 30, 2024.

F&M’s net interest margin improved to 2.47% for the third quarter of 2025, from 2.02% for the third quarter of 2024. Net interest margin was 2.39% for the nine months ended September 30, 2025, compared with 1.95% for the same period in 2024.

For the third quarter of 2025, the Bank recorded a $1.9 million recapture of provision for credit losses, compared with a $3.7 million recapture of provision for credit losses in the third quarter of 2024. For the nine months ended September 30, 2025, the Bank recorded a $600 thousand recapture of provision for credit losses, compared with a $7.2 million recapture of provision for credit losses for the nine months ended September 30, 2024.

Total non-interest income was $4.4 million for the third quarter of 2025, compared with non-interest income of $4.5 million for the same period last year. For the nine months ended September 30, 2025, total non-interest income was $13.2 million, compared with $23.3 million for the nine months ended September 30, 2024.

Total non-interest expense for the third quarter of 2025 was $51.3 million, compared with $48.6 million for the third quarter of 2024. Non-interest expense for the nine months ended September 30, 2025, was $148.8 million, compared with $148.4 million for the nine months ended September 30, 2024.

Third quarter 2025 net income increased to $18.1 million, or $147.32 per diluted share, from $14.3 million, or $115.17 per diluted share, for the third quarter of 2024. Net income for the nine months ended September 30, 2025 was $48.8 million, or $396.30 per diluted share, compared with $40.9 million, or $325.64 per diluted share, for the nine months ended September 30, 2024.

Balance Sheet

Gross loans were $6.24 billion as of September 30, 2025, compared with $6.47 billion as of December 31, 2024. The Bank’s allowance for loan losses totaled $89.9 million, or 1.44 % of loans held-for-investment at September 30, 2025, compared with $96.6 million, or 1.50% of loans held-for investment at December 31, 2024.

The Bank’s total deposits at September 30, 2025 amounted to $8.87 billion, compared with $8.77 billion at December 31, 2024. Noninterest-bearing deposits represented 33.9% of total deposits at September 30, 2025, and 33.2% at December 31, 2024.

Securities sold under repurchase agreements decreased to $977.7 million at September 30, 2025, from $991.9 million at December 31, 2024. Borrowings were $300.0 million at September 30, 2025, a decrease of $200.0 million from $500.0 million at December 31, 2024.

Total assets at September 30, 2025 were $11.62 billion, compared with $11.69 billion at December 31, 2024. Total stockholders’ equity was $1.40 billion at September 30, 2025, up from $1.37 billion at December 31, 2024.

Capital

The Bank’s total risk-based capital ratio was 19.65%; its tier 1 risk-based capital ratio was 18.40%, with a common equity tier 1 capital ratio of 18.40%, and a tier 1 leverage ratio of 12.15%, as of September 30, 2025. The minimum ratios for capital adequacy for a “well-capitalized” bank are 10.00%, 8.00%, 6.50% and 5.00%, respectively.

Stock Repurchase Program

Reflecting confidence in the Bank’s long-term outlook, the Board of Directors has authorized a new stock repurchase program, authorizing the Bank to repurchase up to $10 million of its common stock from time to time through May 9, 2026.

Under the new stock repurchase program, the Bank may purchase shares of its common stock from time to time through various means, including open market transactions and privately negotiated transactions, in each case, subject to applicable requirements and laws. To the extent the Bank repurchases shares, the number of shares repurchased and the timing of any repurchases will depend on a number of factors, including, but not limited to, stock price, trading volume, regulatory requirements, general business conditions and other factors. The Bank may choose to modify, suspend or discontinue such proposed repurchases at any time and anticipates that any such repurchases will be funded from existing cash and cash equivalents or future cash flow. The new stock repurchase program does not obligate the Bank to repurchase any specific number of shares in any particular period.

During the nine months ended September 30, 2025, the Bank repurchased 704 shares of its common stock for $4.0 million on the open market at an average repurchase price of $5,661.92 per share, under its previous $10 million stock repurchase plan, which has expired.

About Farmers & Merchants Bank of Long Beach

Founded in Long Beach in 1907 by C.J. Walker, Farmers & Merchants Bank provides white-glove service to clients at 27 branches from San Clemente to Santa Barbara, as well as through its Online and Mobile Banking platforms. The Bank offers commercial and small business banking, business loan programs, home loans, and a robust offering of consumer retail banking products, including checking, savings and youth accounts. Farmers & Merchants Bank is a California state-chartered bank with deposits insured by the Federal Deposit Insurance Corporation (Member FDIC) and an Equal Housing Lender. For more information about F&M, please visit the website, www.fmb.com.

Forward-Looking Statements

In addition to the historical information contained herein, this press release may contain forward-looking statements about Farmers & Merchants Bank of Long Beach, including, but not limited to, opportunities to further grow the Bank’s franchise. Readers should understand that such forward-looking statements are neither promises nor guarantees and are subject to various risks and uncertainties, many of which are beyond the Bank’s control. Such risks and uncertainties could cause actual results and actions to differ materially from those contemplated. Factors that could cause or contribute to such differences include, but are not limited to, credit, market, operational, liquidity and interest rate risks associated with the Bank’s business and operations, changes in interest rates, changes in general business and economic conditions, changes in banking laws and regulations, loan losses, increases in expenses, changes in rates charged on loans and earned on investments, accounting estimates and judgments, changes in rates on deposits, competition effects, the amount of non-interest income earned, adverse consequences caused by the coronavirus pandemic, as well as other factors. Given these factors, readers should not place undue reliance on any forward-looking statement.

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