The Lodi-based community bank, ranked among the nation’s top performers, continues a decades-long streak of dividend increases as it expands its Northern California footprint.

April 27, 2026

Farmers & Merchants Bancorp (OTCQX: FMCB), the Lodi, California-based parent of F&M Bank, released a first-quarter 2026 update showing $5.8 billion in assets and a continuation of the steady performance metrics that have placed it among the top-ranked community banks in the United States for the past three years.

Headline financial metrics

As of March 31, the bank reported a return on assets of 1.68%, return on equity of 14.69%, a net interest margin of 4.25% on a tax-equivalent basis, and a tangible common equity ratio of 11.05%. Preliminary risk-based capital stood at 15.71%. Founded in 1916, the company now operates 33 locations across Central California and the San Francisco Bay Area with a workforce of 382.

F&M Bank has earned recognition as the top-performing bank in the country in 2022, second in 2023, and third in 2024, according to Bank Director magazine’s annual rankings. It was also named the fifth-best bank in the U.S. as of February 2026 and is one of just 57 companies designated a Dividend King by Sure Dividend — a distinction reserved for firms with at least 50 consecutive years of dividend payments. F&M has now paid dividends for 91 straight years and increased them in 61 of those years.

Loan portfolio and credit quality

Agricultural and ag real estate lending — a business F&M has been engaged in for more than a century — totaled $951.3 billion, representing 26.3% of the loan book and ranking the institution as the 20th-largest agricultural lender in the country. The bank reported no nonperforming agricultural loans as of quarter-end and net recoveries of $1,000 in the segment for the period.

Commercial real estate and construction loans made up 45.0% of the total portfolio, with concentrations well below regulatory thresholds:

• Construction concentration: 20.2% (regulatory threshold: 100%)
• Total CRE concentration: 172.4% (regulatory threshold: 300%)
• Nonperforming CRE: a single $730,000 loan, or 0.02% of total loans and leases

The allowance for credit losses stood at $76.9 million, or 2.12% of loans and leases. The commercial and industrial, consumer, and leasing portfolios reported no nonperforming credits.

Funding, liquidity, and investments

The loan-to-deposit ratio came in at 71.04%, with the cost of total deposits at 1.18% and the cost of interest-bearing deposits at 1.73%. The bank reported no brokered certificates of deposit and no other borrowings as of quarter-end. Its $1.6 billion investment portfolio carried a tax-equivalent yield of 3.70%, a weighted average life of 6.5 years, and effective duration of 5.1 years.

Market territory and shareholder returns

The company’s footprint covers a population of 6.6 million with combined GDP of $559 billion and median household income just shy of $100,000, stretching roughly 105 miles north to south and 60 miles east to west across the Central Valley and Bay Area. Management noted that the majority of California’s watershed runs through its service area — an asset particularly relevant to its agricultural lending franchise.

Shareholders have benefited from an average annual total return of 12.74% over the past 29 years through year-end 2025, alongside an annual dividend growth rate of 11.11% over the same period. Buybacks have reduced the outstanding share count by 8.13% since the end of 2019, including 33,562 shares — or 4.80% of shares outstanding — repurchased during 2025. The company shifted from semi-annual to quarterly dividends beginning in the third quarter of last year.

Branch expansion ahead

F&M disclosed five new branch locations in development:

• Walnut Creek, Livingston, and Lockeford — opening in the third quarter of 2026
• Lafayette — opening in the second quarter of 2027
• Elk Grove — opening in late 2027 or early 2028

The bank also reiterated several external recognitions, including a five-star rating from BauerFinancial, Super Premier Performer status from The Findley Reports, and a Blue Ribbon Commendation of Excellence from VERIBANC.