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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D. C. 20549

FORM 10‑Q

☒ Quarterly report Under Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended March 31, 2026

☐ Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Commission File Number: 000-13273

F&M BANK CORP.

Virginia

54-1280811

(State or Other Jurisdiction of

Incorporation or Organization)

(I.R.S. Employer

Identification No.)

P. O. Box 1111

Timberville, Virginia 22853

(Address of Principal Executive Offices) (Zip Code)

(540) 896-8941

(Registrant's Telephone Number, Including Area Code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
None

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files. Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☐	Non-accelerated filer	☒	Smaller reporting company	☒
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Class		Outstanding at May 11 , 2026
Common Stock, par value ‑ $5 per share		3,559,157 shares

F & M BANK CORP.

Quarterly Report on Form 10-Q

For the quarterly period ended March 31, 2026

Table of Contents

		Page

Part I	Financial Information

Item 1.	Financial Statements	3

	Consolidated Balance Sheets – March 31, 2026 and December 31, 2025	3

	Consolidated Statements of Income – Three Months Ended March 31, 2026 and 2025	4

	Consolidated Statements of Comprehensive Income – Three Months Ended March 31, 2026 and 2025	5

	Consolidated Statements of Changes in Shareholders’ Equity – Three Months Ended March 31, 2026 and 2025	6

	Consolidated Statements of Cash Flows – Three Months Ended March 31, 2026 and 2025	7

	Notes to Consolidated Financial Statements	8

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	31

Item 3.	Quantitative and Qualitative Disclosures about Market Risk	39

Item 4.	Controls and Procedures	39

Part II	Other Information

Item 1.	Legal Proceedings	40

Item 1A.	Risk Factors	40

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	40

Item 3.	Defaults Upon Senior Securities	40

Item 4.	Mine Safety Disclosures	40

Item 5.	Other Information	40

Item 6.	Exhibits	40

Signatures		41

Certifications

Table of Contents

Part I Financial Information

Item 1 Financial Statements

F & M BANK CORP.

Consolidated Balance Sheets

(Dollars in thousands, except share data)

	March 31,			December 31,
	2026			2025*
	*(Unaudited)*
Assets
Cash and due from banks	$	18,337		$	19,311
Money market funds and interest-bearing deposits in other banks		1,045			1,013
Federal funds sold		66,512			48,529
Cash and cash equivalents		85,894			68,853

Securities:
Available for sale, at fair value		350,506			345,339
Other investments, at cost		2,304			2,254

Loans held for sale, at fair value		3,693			3,191

Loans held for investment, net of deferred fees and costs		896,865			886,253
Less: allowance for credit losses		(7,910	)		(7,818	)
Net loans held for investment		888,955			878,435

Bank premises and equipment, net		22,040			21,629
Interest receivable		5,210			5,118
Goodwill		3,082			3,082
Bank owned life insurance		24,600			24,395
Deferred tax asset, net		7,134			6,979
Other assets		15,533			14,482
Total Assets	$	1,408,951		$	1,373,757

Liabilities
Deposits:
Noninterest bearing	$	290,343		$	279,398
Interest bearing		984,721			965,814
Total deposits		1,275,064			1,245,212

Long-term debt		9,921			9,917
Other liabilities		17,395			13,840
Total Liabilities		1,302,380			1,268,969

Commitments and contingencies

Shareholders’ Equity
Common stock, $5 par value, 6,000,000 shares authorized, 3,583,744 (2026) and
3,557,060 (2025) shares issued and outstanding		17,549			17,444
Additional paid in capital		11,705			11,743
Retained earnings		94,506			92,205
Accumulated other comprehensive loss		(17,189	)		(16,604	)
Total Shareholders’ Equity		106,571			104,788
Total Liabilities and Shareholders’ Equity	$	1,408,951		$	1,373,757

*2025 derived from audited consolidated financial statements.

See Notes to Consolidated Financial Statements

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F & M BANK CORP.

Consolidated Statements of Income

(Dollars in thousands, except per share data)

(Unaudited)

	Three Months Ended March 31,
*Interest and Dividend income*	2026			2025
Interest and fees on loans held for investment	$	14,243		$	13,465
Interest and fees on loans held for sale		25			24
Interest from federal funds sold		564			652
Interest and dividends on interest bearing deposits and other investments		23			30
Interest from debt securities		2,638			2,093
Total interest and dividend income		17,493			16,264

*Interest expense*
Total interest on deposits		5,871			6,700
Interest on short-term debt		-			3
Interest on long-term debt		193			117
Total interest expense		6,064			6,820

*Net interest income*		11,429			9,444

Provision for (recovery of) credit losses - loans		289			(180	)
Provision for credit losses – unfunded commitments		20			76
*Total Provision for (Recovery of) Credit Losses*		309			(104	)

*Net Interest Income After (Recovery of) Provision for Credit Losses*		11,120			9,548

*Noninterest income*
Service charges on deposit accounts		343			312
Wealth management income		658			676
Mortgage banking income		492			602
Title insurance income		493			356
Income on bank owned life insurance		212			209
Low income housing partnership amortization		(175	)		(196	)
ATM and check card fees		775			764
Other operating income		99			124
Total noninterest income		2,897			2,847

*Noninterest expense*
Salaries		4,301			4,127
Employee benefits		1,517			1,116
Occupancy expense		395			408
Equipment expense		298			328
FDIC assessment		213			265
Legal and professional expense		753			479
ATM and check card fees		370			327
Data processing fees		948			916
Other operating expenses		1,518			1,558
Total noninterest expense		10,313			9,524

*Income before income taxes*		3,704			2,871
Income tax expense		478			414
*Net Income*	$	3,226		$	2,457
*Per Common Share Data*
Net income (basic and diluted)	$	0.91		$	0.70
Cash dividends on common stock		0.26			0.26
Weighted average common shares outstanding (basic and diluted)		3,560,093			3,530,700

See Notes to Consolidated Financial Statements

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F & M BANK CORP.

Consolidated Statements of Comprehensive Income

(Dollars in thousands)

(Unaudited)

	Three Months Ended March 31,
	2026			2025

Net Income	$	3,226		$	2,457

Other comprehensive income (loss):
Changes in pension plan benefits, net of deferred income tax benefit of $(2) for the three months ended March 31, 2026		(8	)		-
Unrealized gain (loss) on available-for sale securities, net of income tax (benefit) expense of $(153) and $940 for the three months ended March 31, 2026 and 2025, respectively		(577	)		3,537

Total other comprehensive (loss) income		(585	)		3,537

Total comprehensive income	$	2,641		$	5,994

See Notes to Consolidated Financial Statements

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F & M BANK CORP.

Consolidated Statements of Changes in Shareholders’ Equity

(Dollars in thousands)

(Unaudited)

Three Months Ended March 31, 2026 and 2025.

	Common Stock				Additional Paid			Retained			Accumulated Other Comprehensive
	Shares		Amount		in Capital			Earnings			Loss			Total

*Balance December 31, 2024*		3,525,649	$	17,383	$	11,463		$	84,669		$	(27,377	)	$	86,138
Net income		-		-		-			2,457			-			2,457
Other comprehensive income		-		-		-			-			3,537			3,537
Dividends on common stock		-		-		-			(917	)		-			(917	)
Common stock issued		5,090		25		76			-			-			101
Net restricted common stock activity		33,171		-		-			-			-			-
Vesting of time based stock awards issued at date of grant, net of shares withheld for payroll taxes		-		58		(135	)		-			-			(77	)
Stock-based compensation expense		-		-		72			-			-			72
*Balance, March 31, 2025*		3,563,910	$	17,466	$	11,476		$	86,209		$	(23,840	)	$	91,311

*Balance December 31, 2025*		3,557,060	$	17,444	$	11,743		$	92,205		$	(16,604	)	$	104,788
Net income		-		-		-			3,226			-			3,226
Other comprehensive loss		-		-		-			-			(585	)		(585	)
Dividends on common stock		-		-		-			(925	)		-			(925	)
Common stock issued		3,339		17		87			-			-			104
Net restricted common stock activity		23,345		-		-			-			-			-
Vesting of time based stock awards issued at date of grant, net of shares withheld for payroll taxes		-		88		(224	)								(136	)
Stock-based compensation expense		-		-		99			-						99
*Balance, March 31, 2026*		3,583,744	$	17,549	$	11,705		$	94,506		$	(17,189	)	$	106,571

See Notes to Consolidated Financial Statements

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F & M BANK CORP.

Consolidated Statements of Cash Flows

(Dollars in thousands)

(Unaudited)

	Three Months Ended March 31,
	2026			2025
*Cash flows from operating activities*
Net income	$	3,226		$	2,457
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		320			325
Amortization of intangibles		4			8
Amortization of securities		69			192
Proceeds from loans held for sale		28,724			10,849
Loans held for sale originated		(28,881	)		(8,763	)
Gain on sale of loans held for sale		(345	)		(437	)
Provision for (recovery of) credit losses		309			(104	)
Increase in interest receivable		(92	)		(18	)
Decrease in deferred tax asset		-			80
(Increase) decrease in other assets		(1,225	)		929
(Decrease) increase in other liabilities		3,527			(28	)
Amortization of limited partnership investments		175			196
Amortization of debt issuance costs		4			11
Income from life insurance investment		(212	)		(209	)
Gain on the sale of assets held for sale		(2	)		(43	)
Stock-based compensation expense		99			72
Net cash provided by operating activities		5,700			5,517

*Cash flows from investing activities*
Proceeds from maturity of investments available for sale		-			21,360
Purchases of investments available for sale		(14,859	)		(15,359	)
Proceeds from paydowns of mortgage-backed securities		8,893			4,796
Investment in restricted stock, net		(50	)		(5	)
Net (increase) decrease loans held for investment		(10,809	)		12,755
Proceeds from the sale of assets held for sale		3			-
Net purchase of property and equipment		(732	)		(131	)
Net cash provided by investing activities		(17,554	)		23,416

*Cash flows from financing activities*
Net change in deposits		29,852			4,916
Dividends paid in cash		(925	)		(917	)
Proceeds from issuance of common stock		104			83
Repurchase of shares for tax withholding		(136	)		(59	)
Net cash provided by financing activities		28,895			4,023

*Net increase in Cash and Cash Equivalents*		17,041			32,956
*Cash and cash equivalents, beginning of period*		68,853			56,507
*Cash and cash equivalents, end of period*	$	85,894		$	89,463
*Supplemental Cash Flow information:*
Cash paid for: Interest	$	8,786		$	7,388
Taxes		820			-
*Supplemental non-cash disclosures:*
Change in unrealized gain (loss) on securities available for sale	$	(730	)	$	4,477

See Notes to Consolidated Financial Statements

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Notes to the Consolidated Financial Statements

NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation

The Consolidated Financial Statements include the accounts of F&M Bank Corp. (the “Company”), Farmers & Merchants Bank (the “Bank”), VBS Mortgage, LLC (dba “F&M Mortgage”), and VSTitle, LLC (“VST”), with all significant intercompany accounts and transactions eliminated. The operations, assets, and liabilities of FMFS were transferred to the Bank. Effective on May 15, 2025, the operations, assets, and liabilities of VBS Mortgage, LLC (dba “F&M Mortgage”) were transferred to the Bank.

The accounting and reporting policies of the Company conform to accounting principles generally accepted in the United States of America (“GAAP”) and to accepted practices within the banking industry.

Basis of Presentation and Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The material estimate that is particularly susceptible to significant change in the near term relates to the determination of the allowance for credit losses. The unaudited consolidated financial statements in this report have been prepared in accordance with GAAP for interim financial information. Accordingly, these financial statements do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. The unaudited consolidated financial statements include, in the opinion of management, all adjustments necessary to present a fair statement of the financial position and the results of operations for all periods presented.

All such adjustments are of a normal recurring nature. The results of operations in the interim statements are not necessarily indicative of the results of operations that the Company and its subsidiaries may achieve for future interim periods or the entire year. For further information, refer to the consolidated financial statements and footnotes included in the Company's Annual Report on Form 10-K for the year ended December 31, 2025.

Segment Reporting

The Company's revenue is primarily derived from the business of banking. The Company's financial performance is monitored on a consolidated basis by the Chief Executive Officer, who is designated the chief operating decision maker (“CODM”), based upon information provided about the Company’s products and services offered. The segments are also distinguished by the level of information provided to the CODM, who uses such information to review performance of various components of the business, which are then aggregated if the operating performance of products and customers are similar. The CODM evaluates the financial performance of the Company’s business components such as revenue streams, significant expenses, and budget to actual results in assessing the Company’s segments and in determination of allocated resources. The presentation of financial performance to the CODM is consistent with amounts and financial statement line items shown in the Company's Consolidated Balance Sheets and Consolidated Statements of Income. Additionally, the Company's significant expenses are adequately segmented by category and amount in the Consolidated Statements of Income to include all significant items when considering both qualitative and quantitative factors. Significant expenses of the Company include salaries and employee benefits, occupancy expense, equipment expense, data processing fees and legal and professional expenses.

All of the Company's financial results are similar and considered by management to be aggregated into one reportable operating segment. While the Company has assigned certain management responsibilities by region and business-line, the Company's CODM evaluates financial performance on a Company-wide basis. The majority of the Company's revenue is from the business of banking and the Company's assigned regions have similar economic characteristics, products, services and customers. Accordingly, all of the Company's operations are considered by management to be aggregated in one reportable operating segment.

Reclassification

Certain reclassifications have been made to prior period amounts to conform to current period presentation. None of these reclassifications are considered material and have no impact on net income or shareholders’ equity.

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Cash and Cash Equivalents

For purposes of reporting cash flows, cash and cash equivalents include cash on hand, amounts due from banks, federal funds sold, money market funds and interest-bearing deposits. Generally, federal funds are purchased and sold on an overnight basis.

Allowance for Credit Losses – Available for Sale Securities

For available for sale securities, management evaluates all investments in an unrealized loss position on a quarterly basis, and more frequently when economic or market conditions warrant such evaluation. If the Company has the intent to sell the security or it is more likely than not that the Company will be required to sell the security, the security is written down to fair value and the entire loss is recorded in earnings.

If either of the above criteria is not met, the Company evaluates whether the decline in fair value is the result of credit losses or other factors. In making the assessment, the Company may consider various factors including the extent to which fair value is less than amortized cost, performance on any underlying collateral, downgrades in the ratings of the security by a rating agency, the failure of the issuer to make scheduled interest or principal payments and adverse conditions specifically related to the security. If the assessment indicates that a credit loss exists, the present value of cash flows expected to be collected are compared to the amortized cost basis of the security and any excess is recorded as an allowance for credit loss, limited by the amount that the fair value is less than the amortized cost basis. Any amount of unrealized loss that has not been recorded through an allowance for credit loss is recognized in other comprehensive income.

Changes in the allowance for credit loss are recorded as provision for (or reversal of) credit loss expense. Losses are charged against the allowance for credit loss when management believes an available for sale security is confirmed to be uncollectible or when either of the criteria regarding intent or requirement to sell is met. At March 31, 2026 and December 31, 2025, there was no allowance for credit loss related to the available for sale securities portfolio.

Accrued interest receivable on available for sale debt securities totaled $1.3 million and $1.5 million at March 31, 2026 and December 31, 2025, respectively, and was excluded from the estimate of credit losses.

Loans

Loans that management has the intent and ability to hold for the foreseeable future or until maturity or payoff are reported at amortized cost. Amortized cost is the principal balance outstanding, net of discounts and deferred fees and costs. Accrued interest receivable related to loans totaled $3.9 million and $3.6 million at March 31, 2026 and December 31, 2025, respectively, and was reported in accrued interest receivable on the consolidated balance sheets. Interest income is accrued on the unpaid principal balance. Loan origination fees, net of certain direct origination costs, are deferred and recognized in interest income using methods that approximate a level yield without anticipating prepayments.

The accrual of interest is generally discontinued when a loan becomes 90 days past due and is not well collateralized and in the process of collection, or when management believes, after considering economic and business conditions and collection efforts, that the principal or interest will not be collectible in the normal course of business. Past due status is based on contractual terms of the loan. A loan is considered to be past due when a scheduled payment has not been received 30 days after the contractual due date.

All accrued interest is reversed against interest income when a loan is placed on nonaccrual status. Interest received on such loans is accounted for using the cost-recovery method, until qualifying for return to accrual. Under the cost-recovery method, interest income is not recognized until the loan balance is reduced to zero. Loans are returned to accrual status when all the principal and interest amounts contractually due are brought current, there is a sustained period of repayment performance, and future payments are reasonably assured.

Allowance for Credit Losses – Loans

The allowance for credit losses is a valuation account that is deducted from the loans' amortized cost basis to present the net amount expected to be collected on the loans. Loans are charged off against the allowance when management believes the uncollectibility of a loan balance is confirmed. Expected recoveries do not exceed the aggregate of amounts previously charged-off and expected to be charged-off. Accrued interest receivable is excluded from the estimate of credit losses. The allowance for credit losses represents management’s estimate of lifetime credit losses inherent in loans as of the balance sheet date. The allowance for credit losses is estimated by management using relevant available information, from both internal and external sources, relating to past events, current conditions, and reasonable and supportable forecasts.

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The Company utilizes a Qualitative Scorecard (“scorecard”) to adjust the historical loss information, as necessary, to reflect the Company’s expectations about the future. For each segment, the scorecard calculates the difference between the quantitative expected credit loss and the high watermark average remaining maturity loss rates. This difference is the maximum qualitative adjustment that can be applied to that segment. Due to the low number of losses in the Bank’s portfolio, in particular from 2008-2012, all segments leverage peer data to calculate the overall loss rate. The Company believes that in order to provide a reasonable and supportable loss rate, data representative of losses during a financial downturn will provide a better representation of the perceived risk in the portfolio. In determining how to apply the weightings for the various qualitative factors, management assessed which factors would have the highest impact on potential loan losses. The economy and problem loan trends were determined to have the most significant effect on the estimated losses. The most influential factor on potential loan losses was economic conditions, with a weighting of 20%-25%. The Company evaluates the weighting applied to each pool on an annual basis.

The Company measures expected credit losses for loans on a pooled basis when similar risk characteristics exist. The Company has identified the following portfolio segments and calculates the allowance for credit losses for each using a remaining life methodology:

1-4 family residential construction. Construction loans are subject to general risks from changing housing market trends and economic conditions that may impact demand for completed properties, availability of building materials, and the costs of completion. Changes in construction costs and interest rates may impact the borrower’s ability to service the debt. These risks are measured by market-area unemployment rates, bankruptcy rates, housing and commercial building market trends, and interest rates. Risks specific to the borrower are also evaluated, including previous repayment history, debt service ability, and current and projected loan-to-value ratios for the collateral.

Other construction, land development and land. Construction and land development loans are subject to general risks from changing commercial building and housing market trends and economic conditions that may impact demand for completed properties and the costs of completion. Completed properties that do not sell or become leased within originally expected timeframes may impact the borrower’s ability to service the debt. These risks are measured by market-area unemployment rates, bankruptcy rates, housing and commercial building market trends, and interest rates. Risks specific to the borrower are also evaluated, including previous repayment history, debt service ability, and current and projected loan-to-value ratios for the collateral.

Secured by farmland. Farmland loans are loans secured by agricultural property. These loans are subject to risks associated with the value of the underlying farmland and the cash flows of the borrower’s farming operations.

Home equity - open end. The home-equity loan portfolio carries risks associated with the creditworthiness of the borrower and changes in loan-to-value ratios. The Company manages these risks through policies and procedures such as limiting loan-to-value ratios at origination, experienced underwriting, and requiring standards for appraisers.

Real estate. Real estate loans are for consumer residential 1-4 family real estate where the credit quality is subject to risks associated with the borrower’s repayment ability and collateral value, measured generally by analyzing local unemployment and bankruptcy trends, and local housing market trends and interest rates. Risks specific to a borrower are determined by previous repayment history, loan-to-value ratios, and debt-to-income ratios.

Home equity - closed end. The home-equity closed-end loan portfolio carries risks associated with the creditworthiness of the borrower, changes in loan-to-value ratios, and subordinate lien positions. The Company manages these risks through policies and procedures such as limiting loan-to-value ratios at origination, experienced underwriting, and requiring standards for appraisers.

Multifamily. Multifamily loans are loans secured by multi-unit residential property. These loans are subject to risks associated with the value of the underlying property, availability of rental units, as well as the successful operation and management of the property.

Owner-occupied commercial real estate. The commercial real estate segment includes loans secured by commercial real estate occupied by the owner/borrower. Loans in this segment are impacted by economic risks from changing commercial real estate markets, business bankruptcy rates, local unemployment rates and interest rate trends that would impact the businesses housed by the commercial real estate.

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Other commercial real estate. The other commercial real estate segment includes loans secured by commercial real estate leased to non-owners. Loans in the commercial real estate segment are impacted by economic risks from changing commercial real estate markets, rental markets for commercial buildings, business bankruptcy rates, local unemployment rates and interest rate trends that would impact the businesses housed by the commercial real estate.

Agriculture loans. Agriculture loans are secured by agricultural equipment or are unsecured. Credit risk for these loans is subject to economic conditions, local agricultural/farming trends, interest rates, and borrower repayment ability and collateral value (if secured).

Commercial and industrial. Commercial and industrial loans are secured by collateral other than real estate or are unsecured. Credit risk for these loans is subject to economic conditions, local business bankruptcy trends, interest rates, and borrower repayment ability and collateral value (if secured).

Credit cards. Credit card loan portfolios carry risks associated with the creditworthiness of the borrower and changes in the economic environment. The Company manages these risks through policies and procedures such as experienced underwriting, maximum debt to income ratios, and minimum borrower credit scores.

Automobile loans. Automobile loans generally carry certain risks associated with the values of the collateral and borrower’s ability to repay the loan. Lending on new and used vehicles is subject to the risk of changes in the availability of vehicles and the resale value.

Other consumer loans. Other consumer loans may be secured or unsecured. Credit risk stems primarily from the borrower’s ability to repay. If the loan is secured, the Company analyzes loan-to-value ratios. All consumer non-real estate loans are analyzed for debt-to-income ratios and previous credit history, as well as for general risks to the portfolio, including local unemployment rates, personal bankruptcy rates and interest rates.

Municipal loans. Municipal loans are unsecured loans generally made to local towns within the Bank’s trade area. Credit risk is based on the cash flow and management of the local towns’ budgets.

Additionally, the allowance for credit losses calculation includes adjustments for qualitative risk factors that are likely to cause estimated credit losses to differ from historical experience. These qualitative adjustments may increase or reduce reserve levels and include adjustments for lending management experience and risk tolerance, loan review and audit results, asset quality and portfolio trends, loan portfolio growth, industry concentrations, trends in underlying collateral, external factors and economic conditions not already captured.

Loans that do not share risk characteristics are evaluated on an individual basis. Management evaluates loans on nonaccrual status over $250,000 on an individual basis. When management determines that foreclosure is probable and the borrower is experiencing financial difficulty, the expected credit losses are based on the fair value of collateral at the reporting dated adjusted for selling costs as appropriate.

Allowance for Credit Losses – Unfunded Commitments

Financial instruments include off-balance sheet credit instruments, such as commitments to make loans and commercial letters of credit issued to meet customer financing needs. The Company’s exposure to credit loss in the event of nonperformance by the other party to the financial instrument for off-balance sheet loan commitments is represented by the contractual amount of those instruments. Such financial instruments are recorded when they are funded.

The Company records an allowance for credit losses on off-balance sheet credit exposures, unless the commitments to extend credit are unconditionally cancelable, through a charge to provision for credit losses in the Company’s consolidated statements of income. The allowance for credit losses on off-balance sheet credit exposures is estimated by loan segment at each balance sheet date under the current expected credit loss model using the same methodologies as portfolio loans, taking into consideration the likelihood that funding will occur as well as any third-party guarantees. The allowance for unfunded commitments is included in other liabilities on the Company’s consolidated balance sheets.

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Earnings per Share

Basic earnings per share (“EPS”) is computed by dividing net income available to common shareholders by the weighted average number of common shares outstanding. Nonvested restricted shares are included in the computation of basic earnings per share as the holder is entitled to full shareholder benefits during the vesting period, including voting rights and sharing in nonforfeitable dividends. Diluted earnings per share includes all convertible securities, such as convertible preferred stock, convertible debt, equity options, and warrants. The Company does not have any convertible securities that would dilute the earnings per share.

Recent Accounting Pronouncements

Accounting Standards Pending Adoption:

In December 2025, the Financial Accounting Standards Board (the “FASB”) issued amendments to the Accounting Standards Codification to make incremental improvements to generally accepted accounting principles. The amendments are effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods within those annual reporting periods. Early adoption is permitted for both interim and annual financial statements that have not yet been issued or made available for issuance. The Company will apply the amendments prospectively to all transactions recognized on or after the date that the Company first applies the amendments. The Company does not expect these amendments to have a material effect on its financial statements.

In November 2025, the FASB amended the “Financial Instruments—Credit Losses” topic in the Accounting Standards Codification to expand the population of acquired financial assets subject to the gross-up approach. The amendments are effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods within those annual reporting periods. Early adoption is permitted in both interim and annual reporting periods in which financial statements have not yet been issued or made available for issuance. The Company does not expect these amendments to have a material effect on its financial statements.

In November 2024, the FASB issued Accounting Standards Update (“ASU”)2024-03, “Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses.” ASU 2024-03 requires public companies to disclose, in the notes to the financial statements, specific information about certain costs and expenses at each interim and annual reporting period. This includes disclosing amounts related to employee compensation, depreciation, and intangible asset amortization. In addition, public companies will need to provide a qualitative description of the amounts remaining in relevant expense captions that are not separately disaggregated quantitatively. The FASB subsequently issued ASU 2025-01, “Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date”, which amends the effective date of ASU 2024-03 to clarify that all public business entities are required to adopt the guidance in ASU 2024-03 in annual reporting periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027. Early adoption of ASU 2024-03 is permitted. Implementation of ASU 2024-03 may be applied prospectively or retrospectively. The Company does not expect the adoption of ASU 2024-03 to have a material impact on its consolidated financial statements.

Other accounting standards that have been issued or proposed by the FASB or other standards-setting bodies are not expected to have a material effect on the Company’s financial position, result of operations or cash flows.

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NOTE 2 SECURITIES

The amortized cost and estimated fair value of securities available for sale, along with gross unrealized gains and losses are summarized as follows (dollars in thousands):

March 31, 2026	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value
U. S. Treasuries	$	15,093	$	-	$	787	$	14,306
U. S. Government agencies		57,998		-		2,700		55,298
Municipal securities		27,044		22		1,600		25,466
Mortgage-backed securities		246,478		887		17,179		230,186
Corporate debt securities		25,650		5		405		25,250
Total Securities Available for Sale	$	372,263	$	914	$	22,671	$	350,506

December 31, 2025	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value
U. S. Treasuries	$	15,089	$	-	$	755	$	14,334
U. S. Government agencies		57,997		-		2,845		55,152
Municipal securities		27,082		126		1,250		25,958
Mortgage-backed securities		240,548		1,794		16,031		226,311
Corporate debt securities		25,650		106		2,172		23,584
Total Securities Available for Sale	$	366,366	$	2,026	$	23,053	$	345,339

The amortized cost and fair value of securities at March 31, 2026, by contractual maturity are shown below (dollars in thousands). Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

	Securities Available for Sale
	Amortized Cost		Fair Value
Due in one year or less	$	35,588	$	35,082
Due after one year through five years		69,405		66,837
Due after five years through ten years		60,983		58,123
Due after ten years		206,287		190,464
Total	$	372,263	$	350,506

There were no sales of available for sale securities in the first quarter of 2026 or 2025.

The following tables show the present fair value and gross unrealized losses (dollars in thousands), aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, as of the dates stated. The reference point for determining when securities are in an unrealized loss position is period-end; therefore, it is possible that a security’s market value exceeded its amortized cost on other days during the past twelve-month period. Excluded from the tables below were securities whose amortized cost equaled their fair value or were in an unrealized gain position as of the dates stated totaling $70.7 million and $95.6 million, as of March 31, 2026 and December 31, 2025, respectively.

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	Less than 12 Months				More than 12 Months				Total
March 31, 2026	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
U. S. Treasuries	$	-	$	-	$	14,306	$	787	$	14,306	$	787
U. S. Government agencies		-		-		55,298		2,700		55,298		2,700
Municipal securities		6,419		118		17,810		1,482		24,229		1,600
Mortgage-backed securities		45,579		706		116,668		16,474		162,247		17,179
Corporate debt securities		4,097		53		19,648		352		23,745		405
Total Securities Available for Sale	$	56,095	$	877	$	223,730	$	21,795	$	279,825	$	22,671

	Less than 12 Months				More than 12 Months				Total
December 31, 2025	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
U. S. Treasuries	$	-	$	-	$	14,334	$	755	$	14,334	$	755
U. S. Government agencies		-		-		55,152		2,845		55,152		2,845
Municipal securities		-		-		18,080		1,250		18,080		1,250
Mortgage-backed securities		22,829		10		120,511		16,021		143,340		16,031
Corporate debt securities		-		-		18,679		2,172		18,679		2,172
Total Securities Available for Sale	$	22,829	$	10	$	226,756	$	23,043	$	249,585	$	23,053

At March 31, 2026 and December 31, 2025, the majority of securities in an unrealized loss position were of investment grade; however, a portion of the portfolio does not have a third-party investment grade available (securities with fair values of $20.3 million and $19.0 million, respectively). These securities were primarily subordinated debt instruments issued by bank holding companies and are classified as corporate debt securities in the tables above. The Company evaluated the issuers of these individually, observing that each issuer had strong capital ratios and profitability, thereby indicating limited exposure to asset quality or liquidity issues and resulted in no identifiable credit losses. Contractual cash flows for mortgage-backed securities and U.S. Treasury and agencies are guaranteed and/or funded by the U.S. government and government agencies. State and municipal securities showed no indication that the contractual cash flows would not be received when due. The Company does not intend to sell, nor does it believe that it will be required to sell, any of its impaired securities prior to the recovery of the amortized cost. As of March 31, 2026 and December 31, 2025, there was no allowance for credit losses (“ACL”) for the Company's securities AFS portfolio. Any impairment that has not been recorded through an ACL is recognized in accumulated other comprehensive income (loss).

The Company had securities with a collateral value of $113.1 million pledged to the Federal Reserve Discount Window as of March 31, 2026. The Discount Window provides access to funding to help depository institutions manage their liquidity risks. The Bank did not borrow from the Discount Window during the first three months of 2026. Additionally, the Company had securities with a market value of $9.4 million pledged to the Federal Reserve Bank of Richmond as collateral for deposits of the Department of Justice U.S. Bankruptcy Trustee.

As of March 31, 2026, other investments consisted of restricted stock in the Federal Reserve Bank (“FRB”) (carrying basis of $1.14 million at March 31, 2026 and December 31, 2025), Federal Home Loan Bank (“FHLB”) (carrying basis of $975 thousand and $925 thousand at March 31, 2026 and December 31, 2025, respectively), and various other investments (carrying basis of $189 thousand at March 31, 2026 and December 31, 2025). Other investments are carried at cost.

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NOTE 3 LOANS

The following is a summary of the major categories of total loans outstanding at March 31, 2026 and December 31, 2025 (dollars in thousands):

	March 31, 2026			December 31, 2025
1-4 Family residential construction	$	26,802		$	31,118
Other construction, land development and land		42,005			39,187
Secured by farmland		117,937			115,000
Home equity – open end		53,550			51,393
Real estate		250,663			243,361
Home equity – closed end		7,030			5,980
Multifamily		25,276			18,854
Owner-occupied commercial real estate		89,930			96,651
Other commercial real estate		116,446			114,434
Agricultural loans		21,530			20,127
Commercial and industrial		59,833			56,885
Credit cards		3,364			3,387
Automobile loans		69,922			77,080
Other consumer loans		9,044			9,132
Municipal loans		4,137			4,219
Gross loans		897,469			886,808
Unamortized net deferred loan fees		(604	)		(555	)
Less allowance for credit losses		7,910			7,818
Net loans	$	888,955		$	878,435

The table above does not include loans held for sale of $3.7 million and $3.2 million at March 31, 2026 and December 31, 2025, respectively. Loans held for sale consist of single-family residential real estate loans originated for sale in the secondary market.

Accrued interest receivable on loans held for investment totaled $3.9 million and $3.6 million at March 31, 2026 and December 31, 2025, respectively. For the quarters ended March 31, 2026 and 2025, accrued interest receivable write-offs were not material to the Company’s consolidated financial statements.

The Company had loans held for investment pledged as collateral for borrowings with the FHLB totaling $348.1 million and $310.7 million as of March 31, 2026, and December 31, 2025, respectively. The Company maintains a blanket lien on certain loans in its residential real estate, commercial, agricultural farmland, and home equity portfolios.

NOTE 4 ALLOWANCE FOR CREDIT LOSSES

The allowance for credit losses (“ACL”) consists of the allowance for credit losses on loans and the reserve for unfunded commitments. The Company’s ACL is governed by the Company’s ACL Committee, which reports to the Board of Directors and contains representatives from the Company’s finance, credit, and risk teams, and is responsible for calculating the Company’s estimate of expected credit losses and resulting ACL. The ACL Committee considers the quantitative model results and qualitative factors when finalizing the ACL. The Company’s ACL model is subject to the Company’s model risk management program, which is overseen by the Director of Risk Management who reports to the Company’s Board Risk Committee.

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The following tables detail the changes in the ACL for the three months ended March 31, 2026 and 2025 (dollars in thousands).

	For the three months ended March 31, 2026
	Beginning Balance		Charge-offs		Recoveries		(Recovery of) provision for loan credit losses			Ending Balance
1-4 Family residential construction	$	193	$	-	$	-	$	(28	)	$	165
Other construction, land development and land		641		-		-		81			722
Secured by farmland		1,458		-		-		7			1,465
Home equity – open end		177		-		-		7			184
Real estate		629		12		-		27			644
Home equity – closed end		64		-		-		3			67
Multifamily		656		-		-		203			859
Owner-occupied commercial real estate		691		-		-		(4	)		687
Other commercial real estate		246		-		-		4			250
Agricultural loans		130		-		-		(26	)		104
Commercial and industrial		995		-		90		(47	)		1,038
Credit cards		90		14		10		2			88
Automobile loans		1,713		712		418		85			1,504
Other consumer loans		129		14		37		(25	)		127
Municipal loans		6		-		-		-			6
Total allowance for credit losses - loans	$	7,818	$	752	$	555	$	289		$	7,910
Allowance for credit losses – unfunded commitments	$	764	$	-	$	-	$	20		$	784

	For the three months ended March 31, 2025
	Beginning Balance		Charge-offs		Recoveries		(Recovery of) provision for loan credit losses			Ending Balance
1-4 Family residential construction	$	258	$	-	$	-	$	(6	)	$	252
Other construction, land development and land		1,551		-		-		107			1,658
Secured by farmland		946		-		-		97			1,043
Home equity – open end		197		-		24		(30	)		191
Real estate		606		-		1		85			692
Home equity – closed end		99		-		-		(16	)		83
Multifamily		190		-		-		(158	)		32
Owner-occupied commercial real estate		809		-		-		(96	)		713
Other commercial real estate		105		-		-		(22	)		83
Agricultural loans		27		-		-		(2	)		25
Commercial and industrial		982		-		3		(159	)		826
Credit cards		87		15		6		1			79
Automobile loans		1,956		397		164		171			1,894
Other consumer loans		301		1		28		(137	)		191
Municipal loans		15		-		-		(15	)		-
Total allowance for credit losses - loans	$	8,129	$	413	$	226	$	(180	)	$	7,762
Allowance for credit losses – unfunded commitments	$	649	$	-	$	-	$	76		$	725

Credit Quality Indicators

The Company presents loan and lease portfolio segments and classes by credit quality indicator and vintage year. The Company defines the vintage date for the purpose of this disclosure as the date of the most recent credit decision. Renewals are categorized as new credit decisions and reflect the renewal date as the vintage date, except for renewals of loans modified for borrowers experiencing financial difficulty which are presented in the original vintage.

Description of the Company’s credit quality indicators under the Current Expected Credit Loss (“CECL”) Model:

Grades 0-5 – Pass: Loans in all classes that comprise the commercial and consumer portfolio segments that are not adversely rated, are contractually current as to principal and interest, and are otherwise in compliance with the contractual terms of the loan agreement. Management believes that there is a low likelihood of loss related to those loans that are considered pass.

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Grade 6 – Watch: Loans are currently protected but are weak due to negative balance sheet or income statement trends. There may be a lack of effective control over collateral or the existence of documentation deficiencies. These loans have potential weaknesses that deserve management’s close attention. Other reasons supporting this classification include adverse economic or market conditions, pending litigation or any other material weakness. Existing loans that become 60 or more days past due are placed in this category pending a return to current status.

Grade 7 – Substandard: Loans having well-defined weaknesses where a payment default and or loss is possible, but not yet probable. Cash flow is inadequate to service the debt under the current payment, or terms, with prospects that the condition is permanent. Loans classified as substandard are inadequately protected by the current net worth and paying capacity of the borrower and there is the likelihood that collateral will have to be liquidated and/or guarantor(s) called upon to repay the debt. Generally, the loan is considered collectible as to both principal and interest, primarily because of collateral coverage, however, if the deficiencies are not corrected quickly; there is a probability of loss.

Credit cards are classified as pass or substandard. A credit card is substandard when payments of principal and interest are past due 90 days or more.

The following table presents the Company’s recorded investment in loans by credit quality indicators and gross write-offs by year of origination as of March 31, 2026 (dollars in thousands):

	Term Loans by Year of Origination
	2026		2025		2024		2023		2022		Prior		Revolving		Total
1-4 Family residential construction
Pass	$	-	$	-	$	-	$	338	$	-	$	-	$	26,464	$	26,802
Watch		-		-		-		-		-		-		-		-
Substandard		-		-		-		-		-		-		-		-
Total 1-4 Family residential construction		-		-		-		338		-		-		26,464		26,802
Current period gross write-offs		-		-		-		-		-		-		-		-
Other construction, land development and land
Pass		447		7,777		2,599		11,585		960		3,556		15,061		41,985
Watch		-		-		-		-		-		-		-		-
Substandard		-		-		-		-		-		20		-		20
Total Other construction, land development and land		447		7,777		2,599		11,585		960		3,576		15,061		42,005
Current period gross write-offs		-		-		-		-		-		-		-		-
Secured by farmland
Pass		4,530		17,565		9,342		10,780		11,840		46,892		13,483		114,432
Watch		-		-		-		-		1,609		1,484		-		3,093
Substandard		-		-		-		-		302		110		-		412
Total Secured by farmland		4,530		17,565		9,342		10,780		13,751		48,486		13,483		117,937
Current period gross write-offs		-		-		-		-		-		-		-		-
Home equity – open end
Pass		-		-		-		-		-		294		52,548		52,842
Watch		-		-		-		-		-		-		-		-
Substandard		-		-		-		-		-		110		598		708
Total Home equity - open end		-		-		-		-		-		404		53,146		53,550
Current period gross write-offs		-		-		-		-		-		-		-		-
Real estate
Pass		9,057		49,034		27,474		51,267		39,371		68,509		-		244,712
Watch		1,406		-		-		1,429		-		193		-		3,028
Substandard		-		-		-		283		80		2,560		-		2,923
Total Real estate		10,463		49,034		27,474		52,979		39,451		71,262		-		250,663
Current period gross write-offs		-		-		-		-		-		12		-		12
Home Equity – closed end
Pass		126		624		411		2,309		185		2,501		-		6,156
Watch		60		-		-		-		-		-		-		60
Substandard		-		48		-		-		-		766		-		814
Total Home Equity - closed end		186		672		411		2,309		185		3,267		-		7,030
Current period gross write-offs		-		-		-		-		-		-		-		-

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	Term Loans by Year of Origination
	2026		2025		2024		2023		2022		Prior		Revolving		Total
Multifamily
Pass		6,400		6,925		2,667		-		2,535		3,188		3,561		25,276
Watch		-		-		-		-		-		-		-		-
Substandard		-		-		-		-		-		-		-		-
Total Multifamily		6,400		6,925		2,667		-		2,535		3,188		3,561		25,276
Current period gross write-offs		-		-		-		-		-		-		-		-
Owner-occupied commercial real estate
Pass		4,172		19,493		9,330		2,334		10,712		31,585		1,750		79,376
Watch		-		-		-		-		-		-		-		-
Substandard		-		60		1,142		-		-		9,352		-		10,554
Total Owner-occupied commercial real estate		4,172		19,553		10,472		2,334		10,712		40,937		1,750		89,930
Current period gross write-offs		-		-		-		-		-		-		-		-
Other commercial real estate
Pass		3,546		15,010		368		6,802		36,782		42,458		2,676		107,642
Watch		-		-		-		-		-		953		-		953
Substandard		-		-		7,768		-		-		83		-		7,851
Total Other commercial real estate		3,546		15,010		8,136		6,802		36,782		43,494		2,676		116,446
Current period gross write-offs		-		-		-		-		-		-		-		-
Agricultural loans
Pass		1,592		4,857		1,733		1,232		806		112		11,088		21,420
Watch		-		-		-		-		9		16		-		25
Substandard		-		-		-		85		-		-		-		85
Total Agricultural loans		1,592		4,857		1,733		1,317		815		128		11,088		21,530
Current period gross write-offs		-		-		-		-		-		-		-		-
Commercial and industrial
Pass		2,265		17,429		6,358		2,380		4,216		2,252		24,452		59,352
Watch		-		-		-		-		38		-		-		38
Substandard		-		33		-		293		17		-		100		443
Total Commercial and industrial		2,265		17,462		6,358		2,673		4,271		2,252		24,552		59,833
Current period gross write-offs		-		-		-		-		-		-		-		-
Credit Cards
Pass		-		-		-		-		-		-		3,364		3,364
Substandard		-		-		-		-		-		-		-		-
Total Credit Cards		-		-		-		-		-		-		3,364		3,364
Current period gross write-offs		-		-		-		-		-		-		14		14
Automobile loans
Pass		3,238		14,720		15,109		20,377		12,085		3,826		-		69,355
Watch		-		-		-		-		-		-		-		-
Substandard		15		15		174		45		214		104		-		567
Total Automobile loans		3,253		14,735		15,283		20,422		12,299		3,930		-		69,922
Current period gross write-offs		-		102		276		256		50		28		-		712
Other consumer loans
Pass		1,451		3,001		1,905		1,360		873		389		37		9,016
Watch		-		-		-		-		-		-		-		-
Substandard		-		-		-		17		9		2		-		28
Total Other consumer loans		1,451		3,001		1,905		1,377		882		391		37		9,044
Current period gross write-offs		-		3		-		1		3		7		-		14
Municipal loans
Pass		-		-		-		-		-		4,137		-		4,137
Watch		-		-		-		-		-		-		-		-
Substandard		-		-		-		-		-		-		-		-
Total Municipal loans		-		-		-		-		-		4,137		-		4,137
Current period gross write-offs		-		-		-		-		-		-		-		-
Total loans	$	38,305	$	156,591	$	86,380	$	112,916	$	122,643	$	225,452	$	155,182	$	897,469
Less: Unamortized net deferred loan fees																(604	)
Loans held for investment															$	896,865
Current period gross write-offs	$	-	$	105	$	276	$	257	$	53	$	47	$	14	$	752

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The following table presents the Company’s recorded investment in loans by credit quality indicators and gross write-offs by year of origination as of December 31, 2025 (dollars in thousands):

	Term Loans by Year of Origination
	2025		2024		2023		2022		2021		Prior		Revolving		Total
1-4 Family residential construction
Pass	$	-	$	-	$	338	$	-	$	-	$	116	$	30,664	$	31,118
Watch		-		-		-		-		-		-		-		-
Substandard		-		-		-		-		-		-		-		-
Total 1-4 Family residential construction		-		-		338		-		-		116		30,664		31,118
Current period gross write-offs		-		-		-		-		-		-		-		-

Other construction, land development and land
Pass		5,691		2,701		11,877		969		427		3,252		14,195		39,112
Watch		-		-		-		-		-		-		-		-
Substandard		-		-		-		-		-		-		75		75
Total Other construction, land development and land		5,691		2,701		11,877		969		427		3,252		14,270		39,187
Current period gross write-offs		-		-		-		-		-		23		-		23

Secured by farmland
Pass		17,063		9,423		10,887		12,838		13,122		34,648		13,470		111,450
Watch		-		-		-		1,609		1,507		-		-		3,116
Substandard		-		-		-		319		-		-		114		434
Total Secured by farmland		17,063		9,423		10,887		14,766		14,629		34,648		13,584		115,000
Current period gross write-offs		-		-		-		-		-		-		-		-

Home equity – open end
Pass		-		-		-		-		-		122		50,587		50,709
Watch		-		-		-		-		-		-		-		-
Substandard		-		-		-		-		-		-		684		684
Total Home equity - open end		-		-		-		-		-		122		51,271		51,393
Current period gross write-offs		-		-		-		-		27		-		-		27
Real estate
Pass		43,676		26,645		53,562		40,299		11,899		59,454		1,040		236,575
Watch		-		1,416		1,436		-		-		211		-		3,063
Substandard		-		-		289		81		655		2,698		-		3,723
Total Real estate		43,676		28,061		55,287		40,380		12,554		62,363		1,040		243,361
Current period gross write-offs		-		-		-		-		5		-		-		5

Home Equity – closed end
Pass		635		422		2,339		192		57		2,281		-		5,926
Watch		-		-		-		-		-		-		-		-
Substandard		54		-		-		-		-		-		-		54
Total Home Equity - closed end		689		422		2,339		192		57		2,281		-		5,980
Current period gross write-offs		-		-		-		-		-		-		-		-

Multifamily
Pass		7,051		2,680		-		2,556		1,241		2,262		3,064		18,854
Watch		-		-		-		-		-		-		-		-
Substandard		-		-		-		-		-		-		-		-
Total Multifamily		7,051		2,680		-		2,556		1,241		2,262		3,064		18,854
Current period gross write-offs		-		-		-		-		-		-		-		-

Owner-occupied commercial real estate
Pass		20,096		9,403		2,354		16,357		14,163		18,587		4,929		85,889
Watch		-		-		-		-		-		-		-		-
Substandard		62		1,148		-		-		-		9,503		49		10,762
Total Owner-occupied commercial real estate		20,158		10,551		2,354		16,357		14,163		28,090		4,978		96,651
Current period gross write-offs		-		-		-		-		-		301		-		301
Other commercial real estate
Pass		14,989		372		6,853		36,997		11,075		32,759		2,533		105,578
Watch		-		-		-		-		-		966		-		966
Substandard		-		7,806		-		-		-		84		-		7,890
Total Other commercial real estate		14,989		8,178		6,853		36,997		11,075		33,809		2,533		114,434
Current period gross write-offs		-		-		-		-		-		-		-		-
Agricultural loans
Pass		5,387		1,910		1,364		973		151		53		10,092		19,930
Watch		-		-		-		9		-		16		-		25
Substandard		-		-		112		-		-		-		60		172
Total Agricultural loans		5,387		1,910		1,476		982		151		69		10,152		20,127
Current period gross write-offs		-		-		-		171		-		-		-		171

Table of Contents

	Term Loans by Year of Origination
	2025		2024		2023		2022		2021		Prior		Revolving		Total
Commercial and industrial
Pass		18,025		6,615		2,710		4,675		2,359		251		20,980		55,615
Watch		-		-		-		43		-		-		150		193
Substandard		35		-		317		17		-		-		708		1,077
Total Commercial and industrial		18,060		6,615		3,027		4,735		2,359		251		21,838		56,885
Current period gross write-offs		-		408		-		75		-		-		-		483

Credit Cards
Pass		-		-		-		-		-		-		3,387		3,387
Substandard		-		-		-		-		-		-		-		-
Total Credit Cards		-		-		-		-		-		-		3,387		3,387
Current period gross write-offs		-		-		-		-		-		-		57		57

Automobile loans
Pass		16,255		17,479		23,351		14,122		4,512		868		-		76,587
Watch		-		-		-		-		-		-		-		-
Substandard		14		140		21		207		76		35		-		493
Total Automobile loans		16,269		17,619		23,372		14,329		4,588		903		-		77,080
Current period gross write-offs		97		904		1,082		644		186		109		-		3,022

Other consumer loans
Pass		3,215		2,166		1,669		1,128		268		336		307		9,089
Watch		-		-		-		-		-		-		-		-
Substandard		-		-		19		14		8		2		-		43
Total Other consumer loans		3,215		2,166		1,688		1,142		276		338		307		9,132
Current period gross write-offs		9		34		38		58		5		2		-		146
Municipal loans
Pass		-		-		-		-		500		3,719		-		4,219
Watch		-		-		-		-		-		-		-		-
Substandard		-		-		-		-		-		-		-		-
Total Municipal loans		-		-		-		-		500		3,719		-		4,219
Current period gross write-offs		-		-		-		-		-		-		-		-

Total loans	$	152,248	$	90,326	$	119,498	$	133,405	$	62,020	$	172,223	$	157,088	$	886,808
Less: Unamortized net deferred loan fees																(555	)
Loans held for investment															$	886,253

Current period gross write-offs	$	106	$	1,346	$	1,120	$	948	$	223	$	435	$	57	$	4,235

Table of Contents

Nonaccrual and Past Due Loans

The following table shows the aging of the Company’s loans held for investment, by segment (dollars in thousands):

Age Analysis of Past Due Loans As of March 31, 2026
	Accruing Loans 30-59 Days Past due		Accruing Loans 60-89 Days Past due		Accruing Loans 90 Days or More Past due		Nonaccrual Loans		Accruing Current Loans			Total Loans
1-4 Family residential construction	$	-	$	-	$	-	$	-	$	26,802		$	26,802
Other construction, land development and land		-		156		-		20		41,829			42,005
Secured by farmland		-		-		-		412		117,525			117,937
Home equity – open end		98		119		-		484		52,849			53,550
Real estate		2,037		677		-		1,682		246,267			250,663
Home equity – closed end		64		-		-		766		6,200			7,030
Multifamily		-		-		-		-		25,276			25,276
Owner-occupied commercial real estate		1,142		-		-		891		87,897			89,930
Other commercial real estate		-		-		-		-		116,446			116,446
Agricultural loans		-		-		-		85		21,445			21,530
Commercial and industrial		69		-		-		30		59,734			59,833
Credit cards		22		10		5		-		3,327			3,364
Automobile loans		1,058		259		-		446		68,159			69,922
Other consumer loans		110		14		-		28		8,892			9,044
Municipal loans		-		-		-		-		4,137			4,137
Gross loans		4,600		1,235		5		4,844		886,785			897,469
Less: Unamortized net deferred loan fees		-		-		-		-		(604	)		(604	)
Loans held for investment	$	4,600	$	1,235	$	5	$	4,844	$	886,181		$	896,865

Age Analysis of Past Due Loans As of December 31, 2025
	Accruing Loans 30-59 Days Past due		Accruing Loans 60-89 Days Past due		Accruing Loans 90 Days or More Past due		Nonaccrual Loans		Accruing Current Loans		Total Loans
1-4 Family residential construction	$	-	$	-	$	-	$	-	$	31,118	$	31,118
Other construction, land development and land		601		-		-		-		38,586		39,187
Secured by farmland		-		-		-		434		114,566		115,000
Home equity – open end		267		61		-		462		50,603		51,393
Real estate		2,545		902		-		2,308		237,606		243,361
Home equity – closed end		83		-		-		-		5,897		5,980
Multifamily		-		-		-		-		18,854		18,854
Owner-occupied commercial real estate		538		1,148		-		2,201		92,764		96,651
Other commercial real estate		-		-		-		-		114,434		114,434
Agricultural loans		121		-		-		172		19,834		20,127
Commercial and industrial		223		311

F&M BANK CORP 10-Q