Farmers and Merchants Bank, The

Prairie Grove, AR · Cert 8736

FDIC

Q3 2001

$118.0MAssets

$81.1MLoans

$105.9MDeposits

$8.7MEquity

Loan mix

Deposit mix

Executive Summary

Earnings: ROA of 1.64%, up 31 bps year over year; NIM at 4.00%.
Asset quality: problem loans at 0.00% of loans (0 bps YoY), with net charge-offs at 0.13%.
Funding: loans stand at 76.63% of deposits as of Q3 2001.

Return on Assets (YTD, annualized)

1.64%+31 bps YoY

Net Interest Margin (YTD, annualized)

4.00%

Efficiency Ratio (YTD, annualized)

58.66%

Tier 1 Leverage Ratio

n/a

Year to date, annualized, through each quarter.

Metric	Q4 1999	Q1 2000	Q2 2000	Q3 2000	Q4 2000	Q1 2001	Q2 2001	Q3 2001	YoY Δ	Trend
Earnings
Return on Assets	1.26%	1.25%	1.32%	1.33%	1.31%	1.36%	1.72%	1.64%	+31 bps
Return on Equity	n/a	n/a	n/a	n/a	n/a	n/a	n/a	n/a	n/a	n/a
Net Interest Margin	n/a	n/a	n/a	n/a	n/a	3.89%	3.92%	4.00%	n/a
Efficiency Ratio	n/a	n/a	n/a	n/a	n/a	62.74%	56.31%	58.66%	n/a
Non-Interest Burden	n/a	n/a	n/a	n/a	n/a	1.88%	1.34%	1.54%	n/a
Growth
Asset Growth (YoY)	3.20%	4.15%	2.50%	3.39%	5.88%	7.68%	7.77%	5.41%	+202 bps
Loan Growth (YoY)	4.44%	8.07%	6.84%	9.25%	8.26%	11.47%	11.13%	6.23%	-303 bps
Deposit Growth (YoY)	3.20%	5.26%	3.65%	3.98%	6.19%	7.81%	7.65%	5.59%	+161 bps
Asset Quality
Nonperforming Loans / Loans	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0 bps
Net Charge-Offs / Loans	n/a	n/a	n/a	n/a	n/a	0.08%	0.09%	0.13%	n/a
Allowance / Loans	n/a	n/a	n/a	n/a	n/a	1.23%	1.19%	1.17%	n/a
Allowance Coverage of NPLs	n/a	n/a	n/a	n/a	n/a	n/a	n/a	n/a	n/a	n/a
Capital
Tier 1 Leverage Ratio	n/a	n/a	n/a	n/a	n/a	n/a	n/a	n/a	n/a	n/a
Total Risk-Based Capital	n/a	n/a	n/a	n/a	n/a	12.31%	12.55%	12.60%	n/a
Equity / Assets	n/a	n/a	n/a	n/a	n/a	6.85%	7.18%	7.34%	n/a
Liquidity & Funding
Loans / Deposits	73.56%	71.76%	74.08%	76.17%	75.00%	74.20%	76.48%	76.63%	+46 bps
Liquid Assets / Assets	0.00%	0.00%	0.00%	0.00%	0.00%	0.05%	0.05%	0.04%	+4 bps
CRE / Total Capital	n/a	n/a	n/a	n/a	n/a	n/a	n/a	n/a	n/a	n/a