F & M Bank Corp. · OTC:FMBM
F & M Bank — Investor Presentation (August 2017)
23 slides from F & M Bank's investor presentation, Aug 10, 2017
Slide 1: F&M Bank Corp. Financial data as of June 30, 2017
F&M Bank Corp. Financial data as of June 30, 2017
Slide 2: Caution Regarding Forward Looking Statements
Caution Regarding Forward Looking Statements ) F&M Bank Corp. This presentation contains projections, predictions, expectations, and other statements with respect to the Company and its subsidiaries as to beliefs, future events, and/or results that are based on current expectations, estimates, and p
Slide 3: Executive Management Team
Executive Management Team Gap F&M Bank Corp. Ellen R. Fitzwater, Chair of the Board Partner/Financial Manager of F&R Leasing, LLC for 30+ years and 33+ years experience in corporate entities Dean Withers, President/CEO CEO since 2004, with 38+ years in financial services industry Carrie Comer, SVP/C
Slide 4: A Community Focused Institution
A Community Focused Institution GP F&M Bank Corp. “Community Banking at its Finest” Chartered in 1908, Farmers & Merchants Bank has served its local communities for more than 100 years Q Leading, progressive independent bank in the Shenandoah Valley — serving small to medium size businesses with div
Slide 5: Industry Recognition and Accolades
Industry Recognition and Accolades Ga F&M Bank Corp. = Ranked 104th of top 200 banks in US for 3 year average ROE — American Banker Magazine, April 2017 = Named one of 2016 Best 50 on the OTCQX. = Ranked 3rd of top 50 US loan producers by IB Magazine — July 2016 = Recognized as a top 50 US bank for
Slide 6: Franchise Footprint — Shenandoah Valley
Franchise Footprint — Shenandoah Valley Q) FMBM is headquartered within the Shenandoah Valley Region of Virginia: «= FMBM’s operating market falls within the central part of the Shenandoah Valley « 4-county franchise: Rockingham, Shenandoah, Page and Augusta and 3 independent cities = Strategically
Slide 7: Market Overview — Shenandoah Valley
Market Overview — Shenandoah Valley Ga F&M Bank Corp. Q) Predominately rural area with a diverse economy based on manufacturing, agriculture and education «Major industries include advanced food manufacturing, farming, retail trade, government, education and health care «Top employers include James
Slide 8: Recent Company Timeline
Recent Company Timeline Ge F&M Bank Corp. Creating Shareholder Value Through Disciplined Growth $5.00 send yield 3%) sano 2 s2a95 $25.00 $4.00 $20.00 $3.00 aay an $15.00 $2.40 $2.00 $1.88 sua $10.00 0.90 $1.00 — es = 0.80 $5.00 $0.00 $0.00 2013 2014 2015 2016 2Q17 GEmmBEarnings Per Share EEE Dividen
Slide 9: Earnings Highlights
Earnings Highlights Ge F&M Bank Corp. [ Net Income $5,801 $8,417 $9,567 $9,346 Core pre-tax, pre-provision earnings $10,390 $11,768 $12,860 $12,782 Return on average assets 1.00% 1.31% 1.34% 1.28% Return on average equity 8.65% 10.46% 11.18% 10.60% Return on average TCE 9.48% 11.25% 12.59% 11.65% |
Slide 10: Key Ratios
Key Ratios ROAA 1.60 1.40 1.31 2:34 1.28 1.20 1.00 0.80 0.60 0.40 0.20 0.00 2014 2015 2016 2017 ROAA mms F&M Bank ——=Peer Median ———=Peer Top 20% NET INTEREST MARGIN “es 0 4.45 4.30 oc 2018 exc 2015 Peer statistics from the June 30, 2017 Uniform Bank Performance Report, Peer Group 3. 14.00 12.00 10.
Slide 11: Balance Sheet Highlights
Balance Sheet Highlights Ga F&M Bank Corp. ees Total Asset $605,308 $665,150 $744,889 $744,263 Total Gross Loans Held for Investment $518,202 $544,053 $591,636 $603,435 Total Gross Loans Held for Sale $13,382 $57,806 $62,735 $51,767 Total Deposits $491,505 $494,670 $537,085 $536,486 |) i Loans Held
Slide 12: Asset Quality Highlights
Asset Quality Highlights am) F&M Bank Corp. NPA/Asset NCOs/Avg Loans Held for Investment Reserves/Loans Held for Investment Reserves/NPAs NPL/Assets *Annualized 1.73% 34% 1.68% 83.2% 1.15% 1.34% .05% 1.61% 101.5% 98% 94% 22% 1.27% 107.7% 65% 1.01% .11%* 1.20% 95.9% 74% 12 1418 0 oe
Slide 13: Loan Portfolio
Loan Portfolio Gap F&M Bank Corp. Loan Held for Investment Mix: $603.4 million at 6/30/17 > 1-4 family comprises the largest concentration at 29% > Total real estate exposure is 81%; but only 12% construction and development >» Consumer is the fastest 1% growing category = C&D ® Agriculture = HELOC
Slide 14: Loan Portfolio Detail
Loan Portfolio Detail Ga F&M Bank Corp. ($000s) 2014 2015 2016 2Q17 c&D 67,180 69,759 76,172 73,184 a Agriculture 12,507 13,378 12,901 15,024 HELOC 61,576 65,734 65,873 65,737 1-4 Family 162,249 166,587 =172,758 174,179 Multifamily 11,775 7,558 7,605 8,607 Owner-Occupied CRE 59,689 58,870 71,123 73,
Slide 15: Dealer Finance Division
Dealer Finance Division DEALER STATISTICS 5,940,000 80,000,000 70,000,000 4,940,000 60,000,000 3,940,000 50,000,000 2,940,000 40,000,000 30,000,000 1,940,000 20,000,000 10,000,000 ff (60,000) 2014 2015 MEEEGross Income mam Net Income
Slide 16: Dealer Finance Division
Dealer Finance Division Ga F&M Bank Corp. ional Average Virgini: F&M Bank Dealer Division 3'4 Quarter 2016 1.33% 1.12% 49% 4" Quarter 2016 1.44% 1.24% 58% 1% Quarter 2017 1.30% TBA 67% 2°4 Quarter 2017 49% Average FICO Average Term 58 Independent 66 Franchise
Slide 17: Nonperforming & Adversely Classified Assets
Nonperforming & Adversely Classified Assets Gap F&M Bank Corp. Historical Nonperforming Assets (S Millions) $7.0 $6.6 $5.7 $4.9 $3.6 | $2.4 $2.1 $2.0 2014 2015 2016 2Q17 ™@Nonperforming Loans ™ OREO & Repos > Total NPAs were $7.7 million at 6/30/17 > Classified assets have decreased by $36.7 million
Slide 18: Funding Overview - Deposit Composition
Funding Overview - Deposit Composition Gap F&M Bank Corp. =e DEPOSIT MIX 6/30/17 ’ = Non Int. Bearing = NOW & Other Trans. = MMDA & Sav = Retail CDs = Jumbo CDs ee To > The Deposit mix is desirable, with a deposit cost of 54 basis points at 6/30/17 > Non Interest Bearing deposits represent 27% of to
Slide 19: Deposit Composition
Deposit Composition Ga F&M Bank Corp. Non Interest Bearing $ 112,198 $134,787 $146,617 $147,133 NOW & Other Trans. $ 93,693 $ 81,492 $ 92,872 $ 89,318 MMDA & Savings $ 90,149 $ 117,351$ 140,368 $ 141,210 Retail CDs $ 115,651 $ 107,415 $ 106,359 $ 104,289 Jumbo CDs $ 79,813 $ 53,625 $ 50,869 $ 54,536
Slide 20: Strategic Focus
<r) F&M Bank Corp. STRATEGIC FOCUS QO) Strong growth and franchise expansion opportunities exist = Augusta County — expansion to the south * Two full service branches opened in 2015, one in the City of Staunton and one in the Town of Craigsville * Myers Corner (Fishersville) branch opened April of 2
Slide 21: Why F&M Bank Corp?
<2 F&M Bank C WHY F&M Bank Corp? Q Further development of a profitable franchise FMBM is a highly profitable institution — growth in the franchise increases tangible book value and earnings per share Shenandoah Valley is a liquid deposit market and FMBM continues to replace time deposits with lower
Slide 22: Board of Directors
Board of Directors Ellen R. Fitzwater * Chairman of the Board ¢ Financial Manager F&R Leasing/Accounting Consultant Larry A. Caplinger * Chief Lending Officer — 40+ year history with the Bank John N. Crist * Attorney — real estate * Chairman of VBS Mortgage Daniel J. Harshman * Mayor of the Town of
Slide 23: é me >
é me > F&M Bank Corp.