F & M Bank Corp. operates as the holding company for Farmers & Merchants Bank that provides commercial banking services. The company’s services include commercial and individual demand and time deposit accounts, repurchase agreements for commercial customers, commercial and individual loans, Internet and mobile banking, drive-in banking services, ATMs at all branch locations, and various off-site locations, as well as a courier service for its commercial banking customers. The bank makes various types of commercial and consumer loans, and has a portfolio of residential mortgages and a concentration in development lending. The bank’s subsidiaries include TEB Life Insurance Company (TEB) and Farmers & Merchants Financial Services, Inc. (FMFS). The bank also holds a majority ownership in VBS Mortgage LLC (VBS). TEB re-insures credit life and accident and health insurance being sold by the bank in connection with its lending activities. FMFS provides brokerage services, commercial and personal lines of insurance to customers of the bank. VBS originates conventional and government sponsored mortgages through their offices in Harrisonburg and Woodstock. Lending Activities Construction and Development Lending: The company makes construction loans, primarily residential, and land acquisition and development loans. The construction loans are secured by residential houses under construction and the underlying land for which the loan is obtained. The average life of a construction loan is approximately 12 months, and it is re-priced as the prime rate of interest changes. Construction loans involve loan balances concentrated with single borrowers or groups of related borrowers. It also obtains a first lien on the property as security for its construction loans and requires personal guarantees from the borrower’s principal owners. Commercial Real Estate Lending: Commercial real estate loans are secured by various types of commercial real estate in the company’s market area, including multi-family residential buildings, commercial buildings and offices, shopping centers, and churches. Commercial real estate loans involve loan balances concentrated with single borrowers or groups of related borrowers. Business Lending: Business loans have a higher degree of risk than residential mortgage loans and have higher yields. To manage these risks, the company obtains appropriate collateral and personal guarantees from the borrower’s principal owners and monitors the financial condition of its business borrowers. Residential mortgage loans are made on the basis of the borrower’s ability to make repayment from his employment and other income and are secured by real estate whose value tends to be ascertainable. Consumer Lending: The company offers various consumer loans, including personal loans and lines of credit, automobile loans, deposit account loans, installment and demand loans, and home equity lines of credit and loans. Such loans are made to clients with whom the company has a pre-existing relationship. It originates all of its consumer loans in its geographic market area. For home equity lines of credit and loans, its primary consumer loan category, the company requires title insurance, hazard insurance, and if required, flood insurance. Residential Mortgage Lending: The bank makes residential mortgage loans for the purchase or refinance of existing loans with loan to value limits ranging between 80 and 90% depending on the age of the property, borrower’s income and credit worthiness. Loans that are retained in its portfolio carry adjustable rates that could change every 3 to 5 years, based on amortization periods of 20 to 30 years. The bank makes fixed rate mortgage loans with terms of 15 or 30 years through its subsidiary, VBS. The bank also has a relationship with Gateway Savings Bank in Oakland, California where it purchases fixed rate loans for short periods of time pending those loans being sold to investors in the secondary market. In 2012, the bank began operations of a loan production office in Penn Laird, Virginia, which provides automobile financing through a network of automobile dealers. Investment Securities As of December 31, 2012, the company’s investment portfolio included U.S. Treasury, agency, and government sponsored enterprises; municipal securities; mortgage-backed securities; corporate bonds; and marketable equity securities. Deposits As of December 31, 2012, the company’s deposits included noninterest-bearing deposits; and interest-bearing deposits, such as interest checking, savings accounts, and time deposits. Regulation and Supervision The operations of the company and the bank are subject to federal and state statutes, which apply to state member banks of the Federal Reserve System. The stock of the company is subject to the registration requirements of the Securities Act of 1934. The company is subject to the periodic reporting requirements of the Securities Exchange Act of 1934. These include the filing of annual, quarterly, and other current reports with the Securities and Exchange Commission. As an Exchange Act reporting company, the company is directly affected by the Sarbanes-Oxley Act of 2002, which is aimed at improving corporate governance and reporting procedures. The company is complying with Securities and Exchange Commission, and other rules and regulations implemented pursuant to Sarbanes-Oxley. The company is subject to the provisions of the Bank Holding Company Act of 1956, as amended. It is registered as such and is supervised by the Federal Reserve Board. The bank as a state member bank is supervised and regularly examined by the Virginia Bureau of Financial Institutions and the Federal Reserve Board. The requirements of the Community Reinvestment Act are also applicable to the bank. History F & M Bank Corp. was founded in 1908.
f & m bank corp (FMBM:OTC US)
PO Box 1111
Timberville, VA 22853
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To contact F & M BANK CORP, please visit www.farmersandmerchants.biz. Company data is provided by Capital IQ. Please use this form to report any data issues.