F&M Bancorp Reports a 5.6% Increase in Earnings

Apr 17, 2001, 01:00 ET from F&M Bancorp

    FREDERICK, Md., April 17 /PRNewswire/ -- F&M Bancorp (Nasdaq: FMBN),
 headquartered in Frederick, Maryland, reported a 5.6% increase in earnings for
 the quarter ended March 31, 2001 to a record $4.980 million or $.45 per share,
 compared to $4.715 million or $.43 per share for the same period last year.
 These earnings represent a return on average equity of 12.40% and a return on
 average assets of 1.15%.
     Earnings growth in the quarter was due to growth in non-interest income,
 which represented 33% of total revenues. Income from sales of insurance
 increased $271 thousand or 12% from the prior year. Mortgage banking revenues
 increased 13% due to a resurgence in home refinancing as a result of lower
 interest rates. Non-interest income also benefited from bank owned life
 insurance proceeds of $525 thousand which were offset by increases in the
 provision for loan losses and other expenses.
     Net interest income was $32 thousand higher than the prior year due to
 growth in average earning assets, which offset the decline in net interest
 margin. The provision for credit losses was increased by $420 thousand from
 last year as the Bancorp continued to maintain a conservative approach to the
 loan portfolio throughout the economic slowdown that occurred in the 1st
 quarter. Credit quality remains strong with just $3.9 million in non-
 performing assets which represent .22% of total assets. Non-interest expense
 was $549 thousand greater than last year, a 3.5% increase.
     Total assets were $1.771 billion, an increase of 2% over last year. Loans
 of $1.2 billion increased $31.4 million or 2.7% from the year ago period.
 Deposits of $1.4 billion increased $96.1 million or 7.2% from March 31, 2000.
 Equity capital was $164.4 million at March 31, 2001, or $14.91 per share
 compared to $145.0 million, or $13.17 per share at March 31, 2000.
     Faye E. Cannon, President and CEO stated, "F&M Bancorp continues to
 perform well even as the economy appears to be slowing. The markets that F&M
 serves continue to be vibrant and growing. Deposit growth has exceeded our
 expectations and while loan growth has moderated, credit quality remains
 strong. We continue to look for opportunities to enhance revenue and control
 expenses, as evidenced by the conversion of Farmers and Mechanics National
 Bank (the lead bank) from a national bank to a state bank charter.
 
     F&M Bancorp offers a full line of financial services including retail and
 commercial banking, a wide range of consumer and business insurance products,
 trust and estate planning, financial planning and investment management
 services through its subsidiaries. F&M Bancorp, through its Farmers and
 Mechanics Bank and Home Federal Savings Bank, includes 54 community offices, a
 proprietary network of 80 ATMs and a full service mobile Express Bank
 operating in eight contiguous counties in Maryland including Frederick,
 Howard, Baltimore, Carroll, Montgomery, Washington and Allegany, and Adams
 County, PA. F&M Bancorp's Hagerstown, MD-based subsidiary, Keller-Stonebraker
 Insurance, Inc. and its Greenbelt, MD-based subsidiary Potomac Basin Group
 Associates, Inc., provide a full line of consumer and commercial business
 insurance products.
 
 
                                             1st Qtr     4th Qtr     1st Qtr
                                               2001        2000        2000
     End of Period Data
     (in thousand of dollars)
 
     Total Assets                           $1,771,146  $1,795,244  $1,736,064
     Loans - Net                             1,206,953   1,226,124   1,175,575
     Loan Loss Reserve                         (13,489)    (13,232)    (12,948)
     Demand Deposits                           211,814     207,872     193,121
     Total Deposits                          1,432,030   1,364,032   1,335,966
     Total Capital                             164,418     158,036     145,022
 
     Interest Income - Tax Equiv.               32,461      33,517      30,943
     Interest Expense                           15,361      16,447      13,865
 
     Net Interest Income - TE                   17,100      17,070      17,078
     Tax Equiv Adjustment                          810         768         820
 
     Net Interest Income                        16,290      16,302      16,258
     Provision for Loan Losses                   1,095         725         666
 
     Trust & Investment Income                     915         914       1,062
     Insurance Income                            2,538       1,847       2,268
     Service Charges on deposits                 1,977       2,003       1,682
     Other Income                                2,606       2,179       1,950
     Total Noninterest Income                    8,037       6,943       6,962
 
     Salaries and Employee Benefits              8,856       8,807       8,488
     Merger-Related Expenses                        --          --         211
     Occupancy and Equipment                     2,584       2,167       2,601
     Other Expense                               4,877       4,508       4,678
     Total Noninterest Expense                  16,317      15,482      15,978
 
     Income Before income Taxes                  6,915       7,038       6,576
     Income Taxes                                1,935       2,191       1,861
 
     Net Income                                 $4,980      $4,847      $4,715
 
 
                                           1st Qtr     4th Qtr      1st Qtr
                                             2001        2000         2000
     Selected Average Balances
     (in thousand of dollars)
 
     Total Assets                         $1,761,801  $1,769,831    $1,696,593
     Short-Term Funds                         14,526      17,713        21,339
     Taxable Securities                      304,098     287,522       282,841
     Tax-Exempt Securities                   126,756     125,518       130,447
     Loans, net of unearned income         1,206,049   1,227,229     1,142,955
     Total Interest-Earning Assets         1,651,428   1,657,981     1,577,581
 
     Savings / Interest Checking             343,601     340,793       352,920
     Money Market Accounts                   267,890     276,562       220,400
     Certificates of Deposits                569,978     536,742       517,919
     Interest-Bearing Deposits             1,181,469   1,154,097     1,091,238
     Short-Term Borrowings                   173,095     115,587       105,881
     Long-Term Borrowings                     30,996     132,070       120,961
     Total Interest-Bearing Liab.          1,385,560   1,401,755     1,318,080
     Noninterest-Bearing Deposits            196,361     197,874       218,937
     Total Deposits                        1,377,830   1,351,972     1,310,175
     Stockholders' Equity                    162,892     154,236       145,398
 
     Ratios
     (using average balances)
     Interest Margin (tax effected)            4.20%       4.10%         4.35%
     Loans to Deposits                        87.53%      90.77%        87.24%
     Capital to Assets                         9.25%       8.71%         8.57%
     Return on Equity                         12.40%      12.50%        13.04%
     Return on Assets                          1.15%       1.09%         1.12%
     Loan to Assets                           68.46%      69.34%        67.37%
     Reserve to Total Loans                    1.10%       1.09%         1.16%
     Efficiency                               64.91%      64.45%        65.26%
     Efficiency w/o Insurance Co.             63.10%      61.82%        63.55%
     Nonperforming assets/total assets         0.22%       0.21%         0.37%
     Provision for loan loss/total assets      0.06%       0.04%         0.04%
 
 
                                              1st Qtr     4th Qtr     1st Qtr
     (in thousand of dollars)                   2001        2000        2000
 
     Credit Quality Data (EOP)
 
     Non-Accrual Loans                         3,076       2,669       4,551
     Other Real Estate Owned                     825       1,058       1,760
 
     Total Non-Performing Assets               3,901       3,727       6,311
 
     90-Days Past Due                            654       1,230       3,343
 
     Loan Portfolio (EOP)
 
     Construction & Land Devel.               86,141      80,632      71,699
     Commercial Mortgage                     290,426     292,661     296,195
     Residential Mortgage                    352,275     360,144     334,546
     Commercial                              172,998     182,570     180,565
     Consumer                                303,090     308,616     285,201
     Other                                     2,023       1,501       3,660
 
     Total Loans, Net                      1,206,953   1,226,124   1,171,866
 
           Charge-Offs:
     Real Estate                                (141)        (89)       (190)
     Commercial                                  (22)       (119)       (279)
     Consumer                                 (1,426)       (874)       (330)
 
     Total Charge-Offs                        (1,589)     (1,082)       (799)
 
           Recoveries:
     Real Estate                                   1          93           6
     Commercial                                   35          25          26
     Consumer                                    716         117         619
 
     Total Recoveries                            752         235         651
 
     Net Charge-Offs                            (837)       (847)       (148)
 
 
                                             1st Qtr     4th Qtr     1st Qtr
                                               2001        2000        2000
     Non-Performing Loan by Type
     (Non-Accrual)
     (in thousand of dollars)
     Residential Mortgage                          794         865       1,555
     Commercial                                   2282        1804       2,996
 
     Total                                       3,076       2,669       4,551
 
     Per Share Data
 
     EOP Shares Outstanding                 11,026,915  11,014,529  11,011,422
     Avg Shares Outstanding                 11,022,394  11,013,451  11,008,331
 
     Net Income                                   0.45        0.44        0.43
     Dividends                                    0.27        0.27        0.27
     Market Price
           High                                  27.06       21.50       22.63
           Low                                   19.75       18.25       16.75
           Close                                 26.88       20.63       18.00
 
     Book Value                                  14.91       14.35       13.17
     Tangible Book Value                         14.43       13.83       12.59
 
           Memo:
     (dollars in thousands)
     EOP Domestic Offices                           54          54          52
     EOP Intangible Assets                       5,278       5,566       6,287
 
 
                            CONSOLIDATED BALANCE SHEETS
                            F&M BANCORP and Subsidiaries
 
                                                       March 31,   December 31,
                                                         2001          2000
     (Dollars in thousands, except per share data)    (Unaudited)
     ASSETS
     Cash and due from banks                            $61,087        $55,490
     Federal funds sold                                  15,284          3,052
     Interest- bearing deposits with banks                9,828          6,625
       Total cash and cash equivalents                   86,199         65,167
     Loans held for sale                                  4,945          5,994
     Investment securities
       Available for sale, at fair value                417,846        349,806
       Held to maturity, fair value of
         $0 and $89,584, respectively                        --         89,405
       Total investment securities                      417,846        439,211
     Loans, net of unearned income                    1,202,008      1,220,130
     Less: Allowance for credit losses                  (13,489)       (13,232)
       Net loans                                      1,188,519      1,206,898
     Bank premiese and equipment, net                    36,069         35,647
     Other real estate owned, net                           825          1,056
     Interest receivable                                  9,186         11,172
     Intangible assets                                    5,278          5,566
     Other assets                                        22,279         24,533
       Total assets                                  $1,771,146     $1,795,244
 
     LIABILITIES AND SHAREHOLDERS'
      EQUITY
     Liabilities:
     Deposits:
       Noninterest-bearing                             $211,814       $207,872
       Interest-bearing                               1,220,216      1,156,160
         Total deposits                               1,432,030      1,364,032
     Short-term borrowings:
       Federal funds purchased and
        Securities sold under
          agreements to repurchase                       94,279        127,395
       Other short-term borrowings                       19,696        110,676
       Long-term borrowings                              39,915         15,790
       Accrued taxes and other
        liabilities                                      20,808         19,315
     Total liabilities                                1,606,728      1,637,208
     Shareholders' equity
       Common stock, par value $5 per share;
         authorized 50,000,000 shares;
         issued and outstanding
          11,026,915 shares, and
          10,999,621 shares,
          respectively                                   55,135         55,073
       Surplus                                           78,645         78,488
       Retained earnings                                 27,712         25,857
       Accumulated other
        comprehensive (loss) income                       2,926         (1,382)
     Total shareholders' equity                         164,418        158,036
     Total liabilities and
      shareholders' equity                           $1,771,146     $1,795,244
 
     The accompanying notes are an integral part of these consolidated
     financial statement.
 
 
             CONSOLIDATED STATEMENT OF INCOME AND COMPREHENSIVE INCOME
                           F&M BANCORP and Subsidiaries
                                    (Unaudited)
 
     (Dollars in thousands, except per share data)         Three Months Ended
                                                                 March 31,
     Interest Income                                        2001          2000
       Interest and fees on loans                        $24,995       $23,731
       Interest on deposits with banks                        84           147
       Interest and dividends on
        investment securities
         Taxable                                           4,861         4,644
         Tax-exempt                                        1,472         1,487
       Interest on federal funds sold                        239           114
     Total interest income                                31,651        30,123
     Interest Expense
       Interest on deposits                               12,428        10,847
       Interest on federal funds purchased
        and securities sold
         under agreements to repurchase                    1,263         1,282
       Interest on Federal Home Loan Bank
        Borrowings                                           410         1,714
       Interest on other short-term
        borrowings                                         1,260            22
     Total interest expense                               15,361        13,865
       Net interest income                                16,290        16,258
       Provision for credit losses                         1,095           666
     Net interest income after provision
      for credit losses                                   15,195        15,592
     Noninterest Income
       Service charges on deposit accounts                 1,978         1,682
       Insurance income                                    2,539         2,268
       Gains on sales of loans                               507           447
       Gains on sales of securities                           --           --
       Gains (losses) on sales of property                    43            18
       Alternative investment & stock
        brokerage income                                     915         1,062
       Other operating income                              2,055         1,485
     Total noninterest income                              8,037         6,962
     Noninterest Expenses
       Salaries and employee benefits                      8,856         8,488
       Merger-related expenses                                --           211
       Occupancy and equipment expense                     2,583         2,601
       Other operating expense                             4,878         4,678
     Total noninterest expenses                           16,317        15,978
       Income before provision for income
        taxes                                              6,915         6,576
       Provision for income taxes                          1,935         1,861
     Net Income                                           $4,980        $4,715
     Other Comprehensive Income (Loss),
      Net of Tax:
       Unrealized losses on securities                    $4,308         $(297)
       Reclassification adjustment for
        gains (losses) included in net income                 --            --
     Other comprehensive loss                              4,308          (297)
     Comprehensive income                                 $9,288        $4,418
     Earnings per Common Share - Basic
         Based on weighted average shares
          outstanding of
         11,022,394 in 2001,
          and 11,008,331 in 2000                           $0.45         $0.43
     Earnings per Common Share - Diluted
         Based on weighted average shares
          outstanding of
          11,055,867 in 2001, and 11,028,172
          in 2000                                          $0.45         $0.43
     Dividends per Share                                   $0.27         $0.27
 
     The accompanying notes are an integral part of these consolidated
     financial statements.
 
 

SOURCE F&M Bancorp
    FREDERICK, Md., April 17 /PRNewswire/ -- F&M Bancorp (Nasdaq: FMBN),
 headquartered in Frederick, Maryland, reported a 5.6% increase in earnings for
 the quarter ended March 31, 2001 to a record $4.980 million or $.45 per share,
 compared to $4.715 million or $.43 per share for the same period last year.
 These earnings represent a return on average equity of 12.40% and a return on
 average assets of 1.15%.
     Earnings growth in the quarter was due to growth in non-interest income,
 which represented 33% of total revenues. Income from sales of insurance
 increased $271 thousand or 12% from the prior year. Mortgage banking revenues
 increased 13% due to a resurgence in home refinancing as a result of lower
 interest rates. Non-interest income also benefited from bank owned life
 insurance proceeds of $525 thousand which were offset by increases in the
 provision for loan losses and other expenses.
     Net interest income was $32 thousand higher than the prior year due to
 growth in average earning assets, which offset the decline in net interest
 margin. The provision for credit losses was increased by $420 thousand from
 last year as the Bancorp continued to maintain a conservative approach to the
 loan portfolio throughout the economic slowdown that occurred in the 1st
 quarter. Credit quality remains strong with just $3.9 million in non-
 performing assets which represent .22% of total assets. Non-interest expense
 was $549 thousand greater than last year, a 3.5% increase.
     Total assets were $1.771 billion, an increase of 2% over last year. Loans
 of $1.2 billion increased $31.4 million or 2.7% from the year ago period.
 Deposits of $1.4 billion increased $96.1 million or 7.2% from March 31, 2000.
 Equity capital was $164.4 million at March 31, 2001, or $14.91 per share
 compared to $145.0 million, or $13.17 per share at March 31, 2000.
     Faye E. Cannon, President and CEO stated, "F&M Bancorp continues to
 perform well even as the economy appears to be slowing. The markets that F&M
 serves continue to be vibrant and growing. Deposit growth has exceeded our
 expectations and while loan growth has moderated, credit quality remains
 strong. We continue to look for opportunities to enhance revenue and control
 expenses, as evidenced by the conversion of Farmers and Mechanics National
 Bank (the lead bank) from a national bank to a state bank charter.
 
     F&M Bancorp offers a full line of financial services including retail and
 commercial banking, a wide range of consumer and business insurance products,
 trust and estate planning, financial planning and investment management
 services through its subsidiaries. F&M Bancorp, through its Farmers and
 Mechanics Bank and Home Federal Savings Bank, includes 54 community offices, a
 proprietary network of 80 ATMs and a full service mobile Express Bank
 operating in eight contiguous counties in Maryland including Frederick,
 Howard, Baltimore, Carroll, Montgomery, Washington and Allegany, and Adams
 County, PA. F&M Bancorp's Hagerstown, MD-based subsidiary, Keller-Stonebraker
 Insurance, Inc. and its Greenbelt, MD-based subsidiary Potomac Basin Group
 Associates, Inc., provide a full line of consumer and commercial business
 insurance products.
 
 
                                             1st Qtr     4th Qtr     1st Qtr
                                               2001        2000        2000
     End of Period Data
     (in thousand of dollars)
 
     Total Assets                           $1,771,146  $1,795,244  $1,736,064
     Loans - Net                             1,206,953   1,226,124   1,175,575
     Loan Loss Reserve                         (13,489)    (13,232)    (12,948)
     Demand Deposits                           211,814     207,872     193,121
     Total Deposits                          1,432,030   1,364,032   1,335,966
     Total Capital                             164,418     158,036     145,022
 
     Interest Income - Tax Equiv.               32,461      33,517      30,943
     Interest Expense                           15,361      16,447      13,865
 
     Net Interest Income - TE                   17,100      17,070      17,078
     Tax Equiv Adjustment                          810         768         820
 
     Net Interest Income                        16,290      16,302      16,258
     Provision for Loan Losses                   1,095         725         666
 
     Trust & Investment Income                     915         914       1,062
     Insurance Income                            2,538       1,847       2,268
     Service Charges on deposits                 1,977       2,003       1,682
     Other Income                                2,606       2,179       1,950
     Total Noninterest Income                    8,037       6,943       6,962
 
     Salaries and Employee Benefits              8,856       8,807       8,488
     Merger-Related Expenses                        --          --         211
     Occupancy and Equipment                     2,584       2,167       2,601
     Other Expense                               4,877       4,508       4,678
     Total Noninterest Expense                  16,317      15,482      15,978
 
     Income Before income Taxes                  6,915       7,038       6,576
     Income Taxes                                1,935       2,191       1,861
 
     Net Income                                 $4,980      $4,847      $4,715
 
 
                                           1st Qtr     4th Qtr      1st Qtr
                                             2001        2000         2000
     Selected Average Balances
     (in thousand of dollars)
 
     Total Assets                         $1,761,801  $1,769,831    $1,696,593
     Short-Term Funds                         14,526      17,713        21,339
     Taxable Securities                      304,098     287,522       282,841
     Tax-Exempt Securities                   126,756     125,518       130,447
     Loans, net of unearned income         1,206,049   1,227,229     1,142,955
     Total Interest-Earning Assets         1,651,428   1,657,981     1,577,581
 
     Savings / Interest Checking             343,601     340,793       352,920
     Money Market Accounts                   267,890     276,562       220,400
     Certificates of Deposits                569,978     536,742       517,919
     Interest-Bearing Deposits             1,181,469   1,154,097     1,091,238
     Short-Term Borrowings                   173,095     115,587       105,881
     Long-Term Borrowings                     30,996     132,070       120,961
     Total Interest-Bearing Liab.          1,385,560   1,401,755     1,318,080
     Noninterest-Bearing Deposits            196,361     197,874       218,937
     Total Deposits                        1,377,830   1,351,972     1,310,175
     Stockholders' Equity                    162,892     154,236       145,398
 
     Ratios
     (using average balances)
     Interest Margin (tax effected)            4.20%       4.10%         4.35%
     Loans to Deposits                        87.53%      90.77%        87.24%
     Capital to Assets                         9.25%       8.71%         8.57%
     Return on Equity                         12.40%      12.50%        13.04%
     Return on Assets                          1.15%       1.09%         1.12%
     Loan to Assets                           68.46%      69.34%        67.37%
     Reserve to Total Loans                    1.10%       1.09%         1.16%
     Efficiency                               64.91%      64.45%        65.26%
     Efficiency w/o Insurance Co.             63.10%      61.82%        63.55%
     Nonperforming assets/total assets         0.22%       0.21%         0.37%
     Provision for loan loss/total assets      0.06%       0.04%         0.04%
 
 
                                              1st Qtr     4th Qtr     1st Qtr
     (in thousand of dollars)                   2001        2000        2000
 
     Credit Quality Data (EOP)
 
     Non-Accrual Loans                         3,076       2,669       4,551
     Other Real Estate Owned                     825       1,058       1,760
 
     Total Non-Performing Assets               3,901       3,727       6,311
 
     90-Days Past Due                            654       1,230       3,343
 
     Loan Portfolio (EOP)
 
     Construction & Land Devel.               86,141      80,632      71,699
     Commercial Mortgage                     290,426     292,661     296,195
     Residential Mortgage                    352,275     360,144     334,546
     Commercial                              172,998     182,570     180,565
     Consumer                                303,090     308,616     285,201
     Other                                     2,023       1,501       3,660
 
     Total Loans, Net                      1,206,953   1,226,124   1,171,866
 
           Charge-Offs:
     Real Estate                                (141)        (89)       (190)
     Commercial                                  (22)       (119)       (279)
     Consumer                                 (1,426)       (874)       (330)
 
     Total Charge-Offs                        (1,589)     (1,082)       (799)
 
           Recoveries:
     Real Estate                                   1          93           6
     Commercial                                   35          25          26
     Consumer                                    716         117         619
 
     Total Recoveries                            752         235         651
 
     Net Charge-Offs                            (837)       (847)       (148)
 
 
                                             1st Qtr     4th Qtr     1st Qtr
                                               2001        2000        2000
     Non-Performing Loan by Type
     (Non-Accrual)
     (in thousand of dollars)
     Residential Mortgage                          794         865       1,555
     Commercial                                   2282        1804       2,996
 
     Total                                       3,076       2,669       4,551
 
     Per Share Data
 
     EOP Shares Outstanding                 11,026,915  11,014,529  11,011,422
     Avg Shares Outstanding                 11,022,394  11,013,451  11,008,331
 
     Net Income                                   0.45        0.44        0.43
     Dividends                                    0.27        0.27        0.27
     Market Price
           High                                  27.06       21.50       22.63
           Low                                   19.75       18.25       16.75
           Close                                 26.88       20.63       18.00
 
     Book Value                                  14.91       14.35       13.17
     Tangible Book Value                         14.43       13.83       12.59
 
           Memo:
     (dollars in thousands)
     EOP Domestic Offices                           54          54          52
     EOP Intangible Assets                       5,278       5,566       6,287
 
 
                            CONSOLIDATED BALANCE SHEETS
                            F&M BANCORP and Subsidiaries
 
                                                       March 31,   December 31,
                                                         2001          2000
     (Dollars in thousands, except per share data)    (Unaudited)
     ASSETS
     Cash and due from banks                            $61,087        $55,490
     Federal funds sold                                  15,284          3,052
     Interest- bearing deposits with banks                9,828          6,625
       Total cash and cash equivalents                   86,199         65,167
     Loans held for sale                                  4,945          5,994
     Investment securities
       Available for sale, at fair value                417,846        349,806
       Held to maturity, fair value of
         $0 and $89,584, respectively                        --         89,405
       Total investment securities                      417,846        439,211
     Loans, net of unearned income                    1,202,008      1,220,130
     Less: Allowance for credit losses                  (13,489)       (13,232)
       Net loans                                      1,188,519      1,206,898
     Bank premiese and equipment, net                    36,069         35,647
     Other real estate owned, net                           825          1,056
     Interest receivable                                  9,186         11,172
     Intangible assets                                    5,278          5,566
     Other assets                                        22,279         24,533
       Total assets                                  $1,771,146     $1,795,244
 
     LIABILITIES AND SHAREHOLDERS'
      EQUITY
     Liabilities:
     Deposits:
       Noninterest-bearing                             $211,814       $207,872
       Interest-bearing                               1,220,216      1,156,160
         Total deposits                               1,432,030      1,364,032
     Short-term borrowings:
       Federal funds purchased and
        Securities sold under
          agreements to repurchase                       94,279        127,395
       Other short-term borrowings                       19,696        110,676
       Long-term borrowings                              39,915         15,790
       Accrued taxes and other
        liabilities                                      20,808         19,315
     Total liabilities                                1,606,728      1,637,208
     Shareholders' equity
       Common stock, par value $5 per share;
         authorized 50,000,000 shares;
         issued and outstanding
          11,026,915 shares, and
          10,999,621 shares,
          respectively                                   55,135         55,073
       Surplus                                           78,645         78,488
       Retained earnings                                 27,712         25,857
       Accumulated other
        comprehensive (loss) income                       2,926         (1,382)
     Total shareholders' equity                         164,418        158,036
     Total liabilities and
      shareholders' equity                           $1,771,146     $1,795,244
 
     The accompanying notes are an integral part of these consolidated
     financial statement.
 
 
             CONSOLIDATED STATEMENT OF INCOME AND COMPREHENSIVE INCOME
                           F&M BANCORP and Subsidiaries
                                    (Unaudited)
 
     (Dollars in thousands, except per share data)         Three Months Ended
                                                                 March 31,
     Interest Income                                        2001          2000
       Interest and fees on loans                        $24,995       $23,731
       Interest on deposits with banks                        84           147
       Interest and dividends on
        investment securities
         Taxable                                           4,861         4,644
         Tax-exempt                                        1,472         1,487
       Interest on federal funds sold                        239           114
     Total interest income                                31,651        30,123
     Interest Expense
       Interest on deposits                               12,428        10,847
       Interest on federal funds purchased
        and securities sold
         under agreements to repurchase                    1,263         1,282
       Interest on Federal Home Loan Bank
        Borrowings                                           410         1,714
       Interest on other short-term
        borrowings                                         1,260            22
     Total interest expense                               15,361        13,865
       Net interest income                                16,290        16,258
       Provision for credit losses                         1,095           666
     Net interest income after provision
      for credit losses                                   15,195        15,592
     Noninterest Income
       Service charges on deposit accounts                 1,978         1,682
       Insurance income                                    2,539         2,268
       Gains on sales of loans                               507           447
       Gains on sales of securities                           --           --
       Gains (losses) on sales of property                    43            18
       Alternative investment & stock
        brokerage income                                     915         1,062
       Other operating income                              2,055         1,485
     Total noninterest income                              8,037         6,962
     Noninterest Expenses
       Salaries and employee benefits                      8,856         8,488
       Merger-related expenses                                --           211
       Occupancy and equipment expense                     2,583         2,601
       Other operating expense                             4,878         4,678
     Total noninterest expenses                           16,317        15,978
       Income before provision for income
        taxes                                              6,915         6,576
       Provision for income taxes                          1,935         1,861
     Net Income                                           $4,980        $4,715
     Other Comprehensive Income (Loss),
      Net of Tax:
       Unrealized losses on securities                    $4,308         $(297)
       Reclassification adjustment for
        gains (losses) included in net income                 --            --
     Other comprehensive loss                              4,308          (297)
     Comprehensive income                                 $9,288        $4,418
     Earnings per Common Share - Basic
         Based on weighted average shares
          outstanding of
         11,022,394 in 2001,
          and 11,008,331 in 2000                           $0.45         $0.43
     Earnings per Common Share - Diluted
         Based on weighted average shares
          outstanding of
          11,055,867 in 2001, and 11,028,172
          in 2000                                          $0.45         $0.43
     Dividends per Share                                   $0.27         $0.27
 
     The accompanying notes are an integral part of these consolidated
     financial statements.
 
 SOURCE  F&M Bancorp