F & M Bank Corp. · OTC:FMBM
F & M Bank — Investor Presentation (September 2024)
28 slides from F & M Bank's investor presentation, Sep 5, 2024
Slide 1: Investor Presentation September 2024
Investor Presentation September 2024
Slide 2: Caution Regarding Forward Looking Statements
Caution Regarding Forward Looking Statements As used in this presentation, the terms “Company,” “F&M,” “we,” “our” or “us” refer to F & M Bank Corp. and its consolidated subsidiaries. The “Bank” refers to Farmers & Merchants Bank, which is a wholly owned subsidiary of the Company. Certain statements
Slide 3: Non-GAAP Disclaimer
Non-GAAP Disclaimer The Company uses certain non-GAAP (Generally Accepted Accounting Principles) financial measures in this presentation, including core return on average assets, core earnings per share, core return on average tangible common equity, core pre-provision net revenue, core net interest
Slide 4: F&M at a glance
F&M at a glance Overview Financial Summary (1) F&M Branch Footprint 115-year old depository institution operating in the Shenandoah Valley along the I-81 & I-64 corridors Very lucrative/high growth market areas with the ability to reach into the mid-Atlantic markets on the I-81, I-66, and I-64 corri
Slide 5: Executive management biographies
Executive management biographies Mr. Wilkerson has served as the Chief Executive Officer of the Company and the Bank since April 2023. He commenced his banking career in 1982, starting in Dealer Financial Services before transitioning to managing branches and exploring commercial lending in 1986. Ov
Slide 6: Corporate focus
Corporate focus Key Objectives Grow sustainable profitability to a top quartile ROAA Improve earning asset mix by reinvesting proceeds from bond maturities into loans and higher yielding bonds Accomplishments and Initiatives Executive management team focused on collective management and key performa
Slide 7: Positioned to Improve Profitability
Positioned to Improve Profitability 7 Reduced Executive Headcount by three – saving $1.1 million 2 executives in 1Q 2023 (including CEO) One executive 3Q 2024 Reduction in Force Reorganization January 2024 savings of $800,000 pretax Eliminated 11 FTEs in reorganization Expense Control measures imple
Slide 8: Market overview & demographics
Market overview & demographics Top Employers in the Valley Market Accolades Top Employers in the Valley Market Overview Market Drivers Shenandoah Valley Region Diverse economy based on manufacturing, agriculture and education with major industries of advanced food manufacturing, farming, retail trad
Slide 9: Growing deposit market share
Growing deposit market share 2018 Market Share 2023 Market Share F&M has continued to gain market share as other institutions have left the market Note: Combined market share within the counties of Augusta, Frederick, Harrisonburg (City), Rockingham, Shenandoah, Staunton (City), Waynesboro (City), a
Slide 10: Securities portfolio overview
Securities portfolio overview Yield on Securities Commentary The company holds no HTM securities on the balance sheet The duration of the portfolio is 3.5 years with a yield of 2.04% in 2024Q2 The unrealized loss on the securities portfolio totaled $39.3 million at June 30, 2024
Slide 11: Securities portfolio provides significant near–term cash flow
Securities portfolio provides significant near–term cash flow Future Expected Securities Cash Flow ($000’s) Commentary $108 million of projected cash flow and maturities in the bond portfolio by June 30, 2025 will provide actionable opportunity to restructure the balance sheet Expected cash flows fo
Slide 12: Strong asset quality
Strong asset quality Prior to the pandemic, the Company worked through previously identified legacy problem credits Current levels of problem assets are very low The Company has a strong level of reserves The Company has experienced limited recent charge-offs NPAs at June 30, 2024 include a $3.9 mil
Slide 13: Growing, diversified loan portfolio
Growing, diversified loan portfolio Yield on Loans Total Loan Balance ($MMs) Commentary Source: S&P Capital IQ Pro A diversified loan portfolio is a strength of F&M The Company’s portfolio only has 12.0% non-owner occupied CRE The Company’s portfolio is made up of approximately 22% of loans that are
Slide 14: Attractive dealer-based lending business
Attractive dealer-based lending business F&M has an active indirect lending business focused on its community banking footprint Vast majority of collateral is used automobiles Ability to throttle production as needed Credit scores have increased over the past five years Credit performance exceeds na
Slide 15: Serving Shenandoah Valley Agriculture Businesses
Serving Shenandoah Valley Agriculture Businesses F&M has originated over $200 million in agriculture loans in the last 5.5 years The majority in Rockingham and Augusta counties Agriculture portfolio balance is $115 million Portfolio is diversified across poultry, beef, dairy, crops, and other Experi
Slide 16: Granular deposit base
Granular deposit base Commentary Cost of Deposits Total Deposits ($MMs) Historically, the Company has excelled at having a granular, core deposit base, evidenced by an insured deposit ratio of 11.1% F&M has very little reliance on brokered deposits Source: S&P Capital IQ Pro
Slide 17: Historical capital ratios
Consolidated Total Equity / Total Assets Consolidated TCE Ratio(1) (with & without AOCI) Historical capital ratios Bank Tier-1 Risk-based Capital Ratio Bank Total Risk-based Capital Ratio (1) TCE is a non-GAAP financial measure; see slide 26 for more information, including a reconciliation of this n
Slide 18: Key operating metrics
TCE is a non-GAAP financial measure; see slide 26 for more information, including a reconciliation of this non-GAAP financial measure to GAAP ”Core” measures are non-GAAP financial measures and exclude the impact of nonrecurring items such as gain on sale of securities, Infinex and BOLI as well seve
Slide 19: Expense and fee income metrics
Note: “Core” measures are non-GAAP measures and exclude the impact of nonrecurring items such as gain on sale of securities, Infinex and BOLI as well severance, EE and RIF expenses. Additional detail / calculations found in non-GAAP reconciliation; quarterly figures annualized Source: S&P Capital IQ
Slide 20: Net interest margin detail
Net interest margin detail Source: S&P Capital IQ Pro 6.55% 2.04% 2.88% 2.72% 5.19%
Slide 21: Bottom line financial results
Bottom line financial results Earnings per Share Tangible Book Value per Share(1) Dividends per Share Reported EPS Core EPS (2) TBV (ex AOCI) TBV Tangible book value is a non-GAAP financial measure. See slide 26 for more information, including a reconciliation of this non-GAAP financial measure to G
Slide 22: Key investment considerations
Key investment considerations Loyal customer following in strong and stable market Positioned adjacent to other healthy, growing markets Growing loan and deposit balances Opportunity to remix the balance sheet using contractual near-term cash flows from the securities portfolio Larger competitors ar
Slide 23: F&M Bank Corp. Board of Directors
F&M Bank Corp. Board of Directors Daphyne Thomas Retired Professor in the Department of Finance and Business Law at James Madison University Peter Wray Principal broker at Triangle Realtors Ray Burkholder Owner of Balzer and Associates, Inc. Chair of Compensation Committee John Willingham CPA and Pr
Slide 24: Appendix
Appendix / a
Slide 25: Non-GAAP reconciliation (page 1 of 4)
Includes non-recurring revenue related to gain on sale of Inf0inex in 2022 and 2023 as well as gain from BOLI in 2023 die to death of retired officer Includes non-recurring expenses related to severance expense and EE and RIF expenses Source: S&P Capital IQ Pro; Company filings Non-GAAP reconciliati
Slide 26: Non-GAAP reconciliation (page 2 of 4)
Noninterest income excludes gains (losses) on securities transactions and low-income housing partnership losses; noninterest expense excludes amortization of intangibles Source: S&P Capital IQ Pro; Company filings Non-GAAP reconciliation (page 2 of 4) (1)
Slide 27: Non-GAAP reconciliation (page 3 of 4)
Source: S&P Capital IQ Pro; Company filings Non-GAAP reconciliation (page 3 of 4)
Slide 28: Non-GAAP reconciliation (page 4 of 4)
Non-GAAP reconciliation (page 4 of 4) Source: S&P Capital IQ Pro; Company filings