FARMERS NATIONAL BANC CORP /OH/
For the period ended Dec 31, 2025. Filed Mar 5, 2026.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2025 · Filed Mar 5, 2026
FMNB$15.42-0.6%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2024-12-31; filed 2025-03-06.
0000950170-25-034480
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2025-12-31; filed 2026-03-05.
0001437749-26-007084
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 173 previous paragraphs and 150 current paragraphs.
83 unchanged; 42 reworded; 20 added; 45 removed; 3 previous and 5 current paragraphs rearranged.
Tables are not compared: 15 previous and 26 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (20)
Current report
The Company recognized net interest income of $142.4 million for the year ended December 31, 2025, compared to $128.4 million for the year ended December 31, 2024. The tax-equivalent net interest margin increased from 2.69% for 2024 to 2.95% for 2025. The increase in net interest margin was due to higher yields on interest earning assets and lower funding costs on interest bearing liabilities. The Federal Reserve rate cuts late in 2024 and 2025 have benefited funding costs, while the lag effects of assets repricing continued to drive earning asset yields higher.
Current report
Interest expense declined $8.0 million in 2025 to $91.3 million from $99.4 million in 2024. The decrease was primarily due to a 15 basis point decline in the yield on interest-bearing deposits and a decrease in the volume of average borrowed funds which decreased from $381.2 million in 2024 to $260.6 million in 2025.
Current report
(Table Dollar Amounts in Thousands except Per Share Data)
Current report
(Table Dollar Amounts in Thousands except Per Share Data)
Current report
Service charges on deposit accounts decreased to $7.2 million for 2025 compared to $7.3 million in 2024 as overdraft fees lagged levels seen in 2024.
Current report
Bank owned life insurance income increased by $726,000 in 2025 to $3.4 million, compared to $2.7 million for thetwelve months ended December 31, 2024. The Company purchased $15.0 million in policies during the first quarter of 2025 and policy crediting rates have increased over the last twelve months.
Current report
Insurance agency commissions were $6.5 million in 2025 compared to $5.5 million in 2024. The Company shared in the commission from the purchase of the new BOLI policies which added $432,000 to insurance commissions for the year.
Current report
Net gains on the sale of loans increased by $148,000 rising from$1.5 million in 2024 to $1.7 million in 2025 driven by higher mortgage volume in 2025.
Current report
Other mortgage banking income increased by $37,000 in 2025 compared to 2024. The increase was driven by higher servicing income partially offset by higher impairment and slower amortization of the mortgage servicing rights.
Current report
Other operating income decreased to $3.9 million for thetwelve months ended December 31, 2025, from $4.7 million for thetwelve months ended December 31, 2024. Small Business Investment Company ("SBIC") income was $1.8 million for 2025 compared to $2.1 million in 2024. In addition, the Company recorded $565,000 in recoveries on loans that were charged off prior to acquisition in 2024 while the Company did not receive any recoveries in 2025.
Current report
Noninterest expense totaled $116.5 million for the year ended December 31, 2025 compared to $106.7 million for the year ended December 31, 2024. The increase was primarily driven by system conversion and Merger related costs which increased from $92,000 in 2024 to $4.0 million in 2025.
Current report
Salaries and employee benefits increased by $3.4 million to $62.3 million for the year ended December 31, 2025 from $58.9 million for the year ended December 31, 2024. The increase was primarily driven by annual raises, the acquisition of Crest in the fourth quarter of 2024 and higher commission expense from increased revenue in the fee-based businesses.
Current report
Occupancy and equipment expense increased to $17.1 million in 2025 from $15.6 million in 2024 due to increased maintenance and software costs in 2025.
Current report
System conversion and acquisition related costs increased from $92,000 in 2024 to $4.0 million in 2025. The Company announced the plan to acquire Middlefield in October of 2025 along with its intention to convert its core system to Jack Henry. The acquisition expense incurred in 2024 was related to the Company’s acquisition of Crest.
Current report
Advertising costs increased to $1.8 million in 2025 from $1.5 million in 2024 for new marketing campaigns introduced in 2025.
Current report
Intangible amortization expense increased slightly by $38,000 to $2.9 million for the years ended December 31, 2025 and 2024.
Current report
Other operating expense was steady at $13.7 million in 2025 compared to $13.8 million in 2024. The slight decrease was spread across several categories of expense.
Current report
The provision for credit losses, which includes the provision for unfunded commitments, declined to $7.1 million in 2025 compared to $8.0 million in 2024. This decline was attributed to a reduction in net charge offs from $6.8 million in 2024 to $6.3 million in 2025, reduction due to pool migration where the allocated reserve decreased from $1.3 million in 2024 to a release of reserves of $407,000 in 2025, and a reduction due to adjustments in Portfolio Composition and Growth qualitative factor from $844,000 in 2024 to a release of reserves of $1.7 million in 2025. Offsetting this was an increase in specific reserve for individually evaluated credits of $2.4 million from $1.1 million in 2024 to $3.5 million in 2025, and an increase in historical loss ratios where the allocated reserve increased from a release of reserves of $238,000 in 2024 to an increase in reserves of $1.1 million in 2025. The increased specific reserve was driven by $2.1 million for two individually evaluated commercial real estate non-owner occupied relationships.
Current report
Total deposits increased to $4.34 billion at December 31, 2025, from $4.23 billion at December 31, 2024, an increase of $76.0 million. Noninterest bearing deposits increased $28.6 million during 2025 to $994.1 million from $965.5 million. Interest-bearing deposits increased $122.3 million to $3.35 billion at December 31, 2025, compared to $3.23 billion at December 31, 2024. The increase was primarily due to an increase in money market accounts of $113.1 million. The Company paid off its brokered deposits in 2025 to take advantage of lower cost funding opportunities.
Current report
Total long-term borrowings increased $583,000 to $86.7 million at December 31, 2025, from $86.2 million at December 31, 2024. In 2024, the Company bought back and retired $3.0 million of its outstanding subordinated notes. The Company may, at its option, beginning December 15, 2026, redeem additional portions of the notes, in whole or in part, from time to time, subject to certain conditions. See Note 13 to the consolidated Financial Statements additional detail.
Removed paragraphs (45)
Previous report
general economic conditions in markets where the Company conducts business, which could materially impact credit quality trends;
Previous report
the length and extent of the economic impacts of the ongoing conflict in Ukraine;
Previous report
actions by the Federal Reserve Board, U.S. Treasury and other government agencies, including those that impact money supply, market interest rates and inflation;
Previous report
disruptions in the mortgage and lending markets and significant or unexpected fluctuations in interest rates related to governmental responses to inflation, including financial stimulus packages and interest rate changes;
Previous report
general business conditions in the banking industry;
Previous report
the regulatory environment;
Previous report
general fluctuations in interest rates;
Previous report
demand for loans in the market areas where the Company conducts business;
Previous report
rapidly changing technology and evolving banking industry standards;
Previous report
competitive factors, including increased competition with regional and national financial institutions;
Previous report
Farmers' ability to attract, recruit and retain skilled employees; and
Previous report
new service and product offerings by competitors and price pressures.
Previous report
Interest on certain tax-exempt loans and tax-exempt securities in 2024, 2023 and 2022 is not taxable for Federal income tax purposes. In order to compare the tax-exempt yields on these assets to taxable yields, the interest earned on these assets is adjusted to a pre-tax equivalent amount based on the marginal corporate federal income tax rate of 21%.
Previous report
Nonaccrual loans are included in the average balance totals.
Previous report
Total interest income increased $71.2 million from $142.1 million in 2022 to $213.3 million for the twelve months ended December 31, 2023. The increase was primarily due to an increase in the average balance of loans and securities from the acquisition of Emclaire. In addition, the yields received on the various categories of earning assets increased year over year due to rising rates being received.
Previous report
Interest income on loans increased to $171.8 million for the year ended December 31, 2023, compared to $107.8 million for the year ended December 31, 2022. This increase was due to the average loan balances increasing $797.1 million in 2023 primarily due to the acquisition of Emclaire. The yield on loans increased to 5.46% in 2023 from 4.58% in 2022.
Previous report
Income on taxable securities increased by $5.4 million in 2023 due to the average balance being higher by $61.6 million. Yields on taxable securities were also higher by 36 basis points ("bp") in 2023 compared to 2022. The increased balance was due to the Emclaire acquisition. Income on tax exempt securities decreased $1.7 million in 2023 as the average balance of this category declined $46.3 million and the yield on the portfolio declined by 4 bp year over year.
Previous report
Interest expense increased $57.6 million in 2023 compared to 2022 due to an increase of $766.2 million in the volume of interest-bearing liabilities and an increase in the rates paid on deposits and borrowings of 148 bp year over year. The increase in the volume of interest-bearing liabilities was due to the merger with Emclaire while the increase in rates paid was due to the higher interest rate environment that existed in 2023 compared to 2022. The average balance of interest-bearing deposits increased $660.5 million in 2023 primarily due to the Emclaire acquisition while the cost of interest-bearing deposits increased by 141 bp year over year. Interest expense related to interest-bearing deposits was $63.1 million in 2023 compared to $13.1 million in 2022.
Previous report
Interest expense on short-term borrowings was $8.4 million in 2023 compared to $1.4 million in 2022. The increase was due to the increased usage of short term borrowings and an increase in the cost of those borrowings due to the Federal Reserve increasing the fed funds rate. Interest on long-term borrowings increased to $4.1 million in 2023 from $3.4 million in 2022. This increase was primarily due to the increased cost of some of the long term borrowings that are tied to variable rates and which continued to increase in 2023.
Previous report
Bank owned life insurance income increased by $632,000 to $2.4 million for the twelve months ended December 31, 2023, compared to $1.8 million for the twelve months ended December 31, 2022. The increase was due to the addition of Emclaire offset by a decline of $79,000 on the proceeds from death benefits received from the policies.
Previous report
Insurance agency commissions increased by $1.0 million to $5.4 million in 2023 from $4.4 million in 2022. The increase was driven by better margins in the insurance industry in 2023 along with increased sales of annuity products as rates on these products were very attractive to customers. Investment commissions declined slightly to $2.0 million in 2023 from $2.2 million in 2022. This line of business was down due to the heavy demand for annuities in lieu of traditional investment products.
Previous report
Other mortgage banking income was up $420,000 in 2023 compared to 2022. The increase was driven by slower prepayment speeds on the mortgage servicing portfolio in 2023 due to the higher level of interest rates.
Previous report
The Company recorded an $8.4 million gain related to a legal settlement in 2022. No gain was recorded in 2023.
Previous report
Other operating income increased by $495,000 to $4.5 million for the twelve months ended December 31, 2023, from $4.0 million for the twelve months ended December 31, 2022. This increase was primarily due to increased non-recurring income associated with recoveries on Emclaire and Cortland loans that were charged off prior to acquisition. This increase was offset by lower SBIC income in 2023 compared to 2022.
Previous report
Noninterest expense totaled $111.8 million for the twelve months ended December 31, 2023 compared to $94.4 million for the twelve months ended December 31, 2022. The increase is primarily due to the merger with Emclaire and normal increases in operating expenses.
Previous report
Salaries and employee benefits increased to $57.4 million for the year ended December 31, 2023, an increase of $12.4 million, from $45.0 million for the year ended December 31, 2022. This increase was primarily due to the Company having a higher level of employees due to the addition of Emclaire along with normal raise activity.
Previous report
Occupancy and equipment expense increased by $4.0 million to $15.4 million for the twelve months ended December 31, 2023 compared to $11.4 million for the twelve months ended December 31, 2022. The increase was due to the higher level of depreciation and facilities maintenance costs associated with the additional Emclaire properties.
Previous report
FDIC insurance and state and local taxes increased to $5.8 million in 2023 from $4.0 million in 2022. The Emclaire acquisition along with higher FDIC assessment rates in 2023 drove the increase.
Previous report
Professional fees decreased by $1.7 million in 2023 to $4.4 million from $6.1 million for the twelve months ended December 31, 2022. The decrease was due to legal expenses associated with the legal settlement income in 2022 discussed above that did not reoccur in 2023. This amounted to approximately $2.1 million of additional expense in 2022 compared to 2023. Offsetting this somewhat was additional expense associated with the Emclaire acquisition.
Previous report
Merger related costs increased to $5.5 million in 2023 from $4.1 million in 2022. This increase was due to the acquisition of Emclaire at the beginning of 2023.
Previous report
Intangible amortization expense increased by $1.4 million in 2023 to $3.4 million compared to $2.0 million for the year ended December 31, 2022. The increase was primarily driven by the acquisition of Emclaire.
Previous report
Core processing charges increased to $4.6 million in 2023 compared to $3.3 million in 2022. The increase was due to the acquisition of Emclaire.
Previous report
An additional, special charitable donation of $6.0 million was made during 2022 with no such contribution made in 2023. The donation was made possible in 2022 by the $8.4 million legal settlement income discussed above.
Previous report
Other operating expenses increased by $2.8 million to $13.4 million in 2023 compared to $10.6 million in 2022. The increase was primarily due to the acquisition of Emclaire but 2023 also included $785,000 for the settlement of a lawsuit whereas 2022 did not have any of this expense.
Previous report
The provision for credit losses, which includes the provision for unfunded commitments, declined to $8.0 million in 2024 compared to $9.2 million in 2023. In 2023, the Company recognized a day one purchase entry for the Emclaire loans of $7.7 million while there was no day one purchase entry recognized in 2024. Offsetting this was an increase in net charge-offs in 2024 of $4.6 million to $6.8 million compared to net charge-offs of $2.3 million in 2023. The increased net charge-off figure in 2024 was driven by a charge-off of $4.4 million for a single commercial credit backed by office space.
Previous report
Payments based on contractual maturity.
Previous report
Total deposits increased to $4.3 billion at December 31, 2024, from $4.2 billion at December 31, 2023, an increase of $89.4 million. Noninterest bearing deposits declined $61.1 million during 2024 to $965.5 million from $1.03 billion. This decline was primarily due to the migration of noninterest bearing deposits into interest bearing deposits as customers looked to take advantage of the increase in interest rates. Interest-bearing deposits increased $75.5 million to $3.2 billion at December 31, 2024, compared to $3.15 billion at December 31, 2023. The increase was primarily due to the migration of noninterest bearing deposits discussed above. Brokered time deposits increased $75.0 million for the year ended December 31, 2024, due to the Company using brokered time deposits to pay off short-term borrowings.
Previous report
Total long-term borrowings decreased $2.5 million to $86.2 million at December 31. 2024, from $88.7 million at December 31, 2023. The decline was primarily due to the Company purchasing $3.0 million of its subordinated debt during 2024 and recording a gain of $444 thousand. See Note 13 within Item 8 of this Annual report on Form 10-K for additional detail.
Previous report
U.S. changes in real gross domestic product (GDP).
Previous report
U.S. personal consumption expenditures (PCE) inflation.
Showing the first 40 of 45 passages. Open the source sections for the rest.
Reworded paragraphs (42)
Previous wording
The following presents a discussion and analysis of Farmers’ financial condition and results of operations by its management. The review highlights the principal factors affecting earnings and the significant changes in balance sheet items for the years 2024, 2023 and 2022. Financial information for prior years is presented when appropriate. The objective of this financial review is to enhance the reader’s understanding of the accompanying tables and charts, the consolidated financial statements, notes to financial statements and financial statistics appearing elsewhere in this Annual Report on Form 10-K. Where applicable, this discussion also reflects management’s insights of known events and trends that have or may reasonably be expected to have a material effect on Farmers’ business, financial condition or results of operations.
Current wording
The following presents a discussion and analysis of Farmers’ financial condition and results of operations by its management. The review highlights the principal factors affecting earnings and the significant changes in balance sheet items for the years 2025,2024 and 2023. Financial information for prior years is presented when appropriate. The objective of this financial review is to enhance the reader’s understanding of the accompanying tables and charts, the consolidated financial statements, notes to financial statements and financial statistics appearing elsewhere in this Annual Report on Form 10-K. Where applicable, this discussion also reflects management’s insights of known events and trends that have or may reasonably be expected to have a material effect on Farmers’ business, financial condition or results of operations.
Previous wording
The Company recorded net income of $49.9 million for the year ended December 31, 2023, compared to $60.6 million for the year ended December 31, 2022. The Company reported $1.33 per diluted common share in 2023 compared to $1.79 per diluted common share in 2022. The results for 2023 include a full year of income and expense from the Emclaire acquisition which closed on January 1, 2023.
Current wording
The Company recorded net income of $54.6 million for the year ended December 31, 2025, compared to $45.9 million for the year ended December 31, 2024. The Company reported $1.45 per diluted common share in 2025 compared to $1.22 per diluted common share in 2024.
Previous wording
Total interest income increased from $213.3 million in 2023 to $227.7 million for 2024. The increase was primarily due to an increase in the yield on loans and securities associated with the higher interest rate environment.
Current wording
Total interest income increased from $227.7 million in 2024 to $233.8 million for 2025. The increase was primarily due to an increase in the yield on loans and securities associated with the higher interest rate environment.
Previous wording
The income on federal funds sold and other interest income increased by $1.8 million in 2023 compared to 2022 primarily due to an increase of 239 bp in the yield on the portfolio. This portfolio is heavily impacted by the actions of the Federal Reserve.
Current wording
The income on federal funds sold and other interest income decreased by $1.9 million in 2025 to $1.8 million compared to $3.7 million in 2024 primarily due to a volume decrease of $26.8 million in 2025 and a decrease of 128 basis points in the yield on the portfolio.
Previous wording
Noninterest income declined to $41.9 million for the year ended December 31, 2023 compared to $44.2 million for the year ended December 31, 2022. The major categories of noninterest income are discussed below.
Current wording
Noninterest income increased to $46.1 million for the year ended December 31, 2025 compared to $41.7 million for the year ended December 31, 2024. The major categories of noninterest income are discussed below.
Previous wording
Trust fees increased to $10.1 million for the twelve months ended December 31, 2024, compared to $9.0 million for the twelve months ended December 31, 2023. The trust business continued to grow in 2024 as the value of assets under management increased.
Current wording
Trust fees increased to $11.1 million for thetwelve months ended December 31, 2025, compared to $10.1 million for thetwelve months ended December 31, 2024. The trust business continued to grow in 2025 as the value of assets under management increased.
Previous wording
Retirement plan consulting fees increased to $2.6 million for 2024 compared to $2.5 million for 2023. The Company picked up additional business in 2024 and with the acquisition of Crest in December of 2024, revenue from this business should continue to increase in 2025.
Current wording
Retirement plan consulting fees increased to $3.7 million for 2025 compared to $2.6 million for 2024. The Company picked up additional business in 2025 with the acquisition of Crest in December of 2024. Revenue from this business is expected to continue to increase in 2026.
Previous wording
Debit card fees increased to $7.1 million in 2023 compared to $5.8 million in 2022. The increase was primarily due to the addition of Emclaire.
Current wording
Debit card fees increased to $7.9 million in 2025 compared to $7.5 million in 2024. The increase was primarily due to higher volumes.
Previous wording
Income tax expense decreased to $8.8 million for the year ended December 31, 2023, from $12.2 million for the year ended December 31, 2022. The decrease was primarily due to a $14.1 million decrease in income before income taxes. Income taxes are computed using the appropriate effective tax rates for each period. The effective tax rates are less than the statutory tax rate primarily due to nontaxable interest and dividend income. The effective income tax rate was 14.9% in 2023 and 16.8% for 2022. Refer to Note 18 to the consolidated financial statements for additional information regarding the effective tax rate.
Current wording
Income tax expense increased from $9.5 million for the year ended December 31, 2024, to $10.5 million for the year ended December 31, 2025. The increase was primarily due to higher pretax income partially offset by a lower effective tax rate due to increased tax credits investments. Income taxes are computed using the appropriate effective tax rates for each period. The effective tax rates are less than the statutory tax rate primarily due to nontaxable interest and dividend income. The effective income tax rate was 16.1% in 2025 and 17.1% for 2024. Refer to Note 18 to the Consolidated Financial Statements for additional information regarding the effective tax rate.
Previous wording
The Company recognized net interest income of $128.4 million for the year ended December 31, 2024, compared to $137.8 million for the year ended December 31, 2023. The tax-equivalent net interest margin declined from 2.91% for 2023 to 2.69% for 2024. The margin declined due to increased funding costs associated with the Federal Reserve's aggressive rate increases in 2022 and 2023 along with an inverted U.S treasury yield curve which caused deposit funding costs to rise faster than the yields being earned on loans and securities.
Current wording
The Company recognized net interest income of $128.4 million for thetwelve months ended December 31, 2024, compared to $137.8 million for the twelve months ended December 31, 2023. The tax-equivalent net interest margin declined from 2.91% for 2023 to 2.69% for the year ended December 31, 2024. The margin declined due to increased funding costs associated with the Federal Reserve's aggressive rate increases in 2022 and 2023 along with an inverted U.S treasury yield curve which caused deposit funding costs to rise faster than the yields being earned on loans and securities.
Previous wording
Interest income on loans increased to $185.7 million for the year ended December 31, 2024, compared to $171.8 million for the year ended December 31, 2023. This increase was due to better yields on loans which increased from 5.46% in 2023 to 5.76% in 2024.
Current wording
Interest income on loans increased to $185.7 million for the year ended December 31, 2024, compared to $171.8 million for the year ended December 31, 2023. This increase was due to better yields on loans which increased to 5.76% in 2024 from 5.46% in 2023.
Previous wording
Interest expense increased $23.8 million in 2024 to $99.4 million from $75.5 million in 2023. The increase was primarily due to a 59 basis point increase in the yield on interest-bearing deposits and an increase in the volume of average borrowed funds which increased from $249.4 million in 2023 to $381.2 million in 2024. The increase in deposit costs was driven by the movement of lower cost checking and savings deposits into certificates of deposit while the increase in borrowed funds was due a lower level of brokered CDs utilized in 2024.
Current wording
Interest expense increased $23.8 million in 2024 to $99.4 million from $75.5 million in 2023 The increase was primarily due to a 59 basis point increase in the yield on interest-bearing deposits and an increase in the volume of average borrowed funds which increased from $249.4 million in 2023 to $381.2 million in 2024. The increase in deposit costs was driven by the movement of lower cost checking and savings deposits into certificates of deposit while the increase in borrowed funds was due to a lower level of brokered CDs utilized in 2024.
Previous wording
Service charges on deposit accounts increased to $7.3 million for 2024 compared to $6.3 million in 2023. The increase was primarily due to the Company undertaking a review of all service charges in late 2023 and early 2024 and implementing fee increases across deposit product lines in the second quarter of 2024.
Current wording
Service charges on deposit accounts totaled $7.3 million in 2024 compared to $6.3 million in 2023. The increase was primarily due to the Company undertaking a review of all service charges in late 2023 and early 2024 and implementing fee increases across deposit product lines in the second quarter of 2024.
Previous wording
Bank owned life insurance income increased by $217,000 in 2024 to $2.7 million, compared to $2.4 million for the twelve months ended December 31, 2023. The increase was due to an increase of $241,000 from earnings on the policies offset by a decline in death benefits received from the policies.
Current wording
Bank owned life insurance income increased by $217,000 to $2.7 million for thetwelve months ended December 31, 2024, compared to $2.4 million for the twelve months ended December 31, 2023. The increase was due to an increase of $241,000 from earnings on the policies offset by a decline in death benefits received from the policies.
Previous wording
Trust fees increased to $9.0 million in 2023 from $8.5 million in 2022. The trust business continued to expand in 2023 as the Company added revenue producers in the new Pennsylvania markets.
Current wording
Trust fees increased to $10.1 million in 2024 from $9.0 million in 2023. The trust business continued to grow in 2024 as the value of assets under management increased.
Previous wording
Other operating income increased to $4.7 million for the twelve months ended December 31, 2024, from $4.5 million for the twelve months ended December 31, 2023. This increase was primarily due to decreased losses on the sale of assets offset by higher Small Business Investment Company (“SBIC”) income in 2024 compared to 2023.
Current wording
Other operating income increased to $4.7 million for thetwelve months ended December 31, 2024, from $4.5 million for the twelve months ended December 31, 2023. This increase was primarily due to decreased losses on the sale of assets offset by higher SBIC income in 2024 compared to 2023.
Previous wording
Noninterest expense totaled $106.7 million for the year ended December 31, 2024 compared to $111.8 million for the year ended December 31, 2023. The decline was primarily driven by merger related costs which fell from $5.5 million in 2023 to $92 thousand in 2024.
Current wording
Noninterest expense totaled $106.7 million for thetwelve months ended December 31, 2024 compared to $111.8 million for the twelve months ended December 31, 2023. The decline was primarily driven by merger related costs which fell from $5.5 million in 2023 to $92,000 in 2024.
Previous wording
Salaries and employee benefits increased by $1.6 million to $58.9 million for the year ended December 31, 2024 from $57.4 million for the year ended December 31, 2023. This increase was primarily due to salary increases and greater incentive compensation.
Current wording
Salaries and employee benefits increased to $58.9 million for the year ended December 31, 2024, an increase of $1.6 million, from $57.4 million for the year ended December 31, 2023. This increase was primarily due to salary increases and greater incentive compensation.
Previous wording
Intangible amortization expense decreased by $573,000 to $2.9 million for the year ended December 31, 2024 compared to $3.4 million for the year ended December 31, 2023. The decline was primarily driven by the runoff of intangibles from older acquisitions.
Current wording
Intangible amortization expense decreased by $573,000 in 2024 to $2.9 million compared to $3.4 million for the year ended December 31, 2023. The decline was primarily driven by the runoff of intangibles from older acquisitions.
Previous wording
Income tax expense increased from $8.8 million for the year ended December 31, 2023, to $9.5 million for the year ended December 31, 2024. The increase was primarily due to a higher effective tax rate and less benefit from low income housing tax credits. Income taxes are computed using the appropriate effective tax rates for each period. The effective tax rates are less than the statutory tax rate primarily due to nontaxable interest and dividend income. The effective income tax rate was 17.1% in 2024 and 14.9% for 2023. Refer to Note 18 to the consolidated financial statements for additional information regarding the effective tax rate.
Current wording
Income tax expense increased to $9.5 million for the year ended December 31, 2024, from $8.8 million for the year ended December 31, 2023. The increase was primarily due to a higher effective tax rate and less benefit from low income housing tax credits. Income taxes are computed using the appropriate effective tax rates for each period. The effective tax rates are less than the statutory tax rate primarily due to nontaxable interest and dividend income. The effective income tax rate was 17.1% in 2024 and 14.9% for 2023. Refer to Note 18 to the Consolidated Financial Statements for additional information regarding the effective tax rate.
Previous wording
Total loans were $3.27 billion at December 31, 2024, compared to $3.20 billion at December 31, 2023, an increase of $70.2 million. Loans comprised 66.5% of the Bank’s average earning assets in 2024, compared to 65.3% in 2023.
Current wording
Total loans were $3.30 billion at December 31, 2025, compared to $3.27 billion at December 31, 2024, an increase of $36.4 million. Loans comprised 67.0% of the Bank’s average earning assets in 2025, compared to 66.5% in 2024.
Previous wording
Commercial real estate loans increased to $1.38 billion at December 31, 2024 from $1.33 billion at December 31, 2023. The Company’s commercial real estate loan portfolio includes loans for owner occupied and non-owner occupied real estate. These loans are made to finance properties such as office and industrial buildings, hotels and retail shopping centers.
Current wording
Commercial real estate loans increased to $1.40 billion at December 31, 2025 from $1.38 billion at December 31, 2024. The Company’s commercial real estate loan portfolio includes loans for owner occupied and non-owner occupied real estate. These loans are made to finance properties such as office and industrial buildings, hotels and retail shopping centers.
Previous wording
Residential real estate mortgage loans increased to $1.00 billion at December 31, 2024, from $986.0 million at December 31, 2023. Farmers originated both fixed rate and adjustable rate mortgages during 2024. Fixed rate terms are offered with terms between fifteen and thirty years while adjustable rate products are offered with maturities up to thirty years. The Company sells all fixed rate loans that are secondary market eligible.
Current wording
Residential real estate mortgage loans increased to $1.03 billion at December 31, 2025, from $1.0 billion at December 31, 2024. Farmers originated both fixed rate and adjustable rate mortgages during 2025. Fixed rate terms are offered with terms between fifteen and thirty years while adjustable rate products are offered with maturities up to thirty years. The Company sells all fixed rate loans that are secondary market eligible.
Previous wording
Commercial loans at December 31, 2024, totaled $351.5 million compared to $347.8 million at December 31, 2023. The Bank’s commercial loans are granted to customers within the immediate trade area of the Bank. The mix is diverse, covering a wide range of borrowers, business types and local municipalities. The Bank monitors and controls concentrations within a particular industry or segment of the economy. These loans are made for purposes such as equipment purchases, capital and leasehold improvements, the purchase of inventory, general working capital and small business lines of credit.
Current wording
Commercial loans at December 31, 2025, totaled $341.7 million compared to $351.5 million at December 31, 2024. The Bank’s commercial loans are granted to customers within the immediate trade area of the Bank. The mix is diverse, covering a wide range of borrowers, business types and local municipalities. The Bank monitors and controls concentrations within a particular industry or segment of the economy. These loans are made for purposes such as equipment purchases, capital and leasehold improvements, the purchase of inventory, general working capital and small business lines of credit.
Previous wording
Agricultural loans increased from $261.8 million in 2023 to $263.0 million in 2024. The Company’s agricultural loan portfolio contains a diverse mix of dairy, crops, land, poultry and cattle loans.
Current wording
Agricultural loans increased from $263.0 million in 2024 to $266.3 million in 2025. The Company’s agricultural loan portfolio contains a diverse mix of dairy, crops, land, poultry and cattle loans.
Previous wording
Consumer loans increased to $268.5 million at December 31, 2024, from $267.9 million at December 31, 2023. The consumer loan portfolio includes indirect auto loans and other consumer loan products.
Current wording
Consumer loans decreased to $266.7 million at December 31, 2025, from $268.5 million at December 31, 2024. The consumer loan portfolio includes indirect auto loans and other consumer loan products.
Previous wording
The following is an analysis of the allowance for credit losses for the years 2020 through 2024. During the years 2021-2024, the Company used the CECL methodology while the incurred loss methodology was used in 2020:
Current wording
The following is an analysis of the allowance for credit losses for the years 2021 through 2025:
Previous wording
The allowance for credit losses to total loans increased to 1.10% at December 31, 2024, compared to 1.08% at December 31, 2023. Nonperforming loans to total loans increased from 0.47% at December 31, 2023 to 0.70% at December 31, 2024. Nonperforming loans to total loans increased in 2024 primarily due to a single commercial real estate credit totaling $8.8 million moving into nonaccrual status.
Current wording
The allowance for credit losses to total loans increased to 1.11% at December 31, 2025, compared to 1.10% at December 31, 2024. Nonperforming loans to total loans increased from 0.70% at December 31, 2024 to 0.79% at December 31, 2025. Nonperforming loans to total loans increased in 2025 primarily due to a single commercial real estate relationship totaling $4.4 million moving into nonaccrual status.
Previous wording
The allowance for credit losses increased to $35.9 million at December 31, 2024, compared to $34.4 million at December 31, 2023. The increase was primarily driven by growth in the loan portfolio.
Current wording
The allowance for credit losses increased to $36.8 million at December 31, 2025, compared to $35.9 million at December 31, 2024. The increase was primarily driven by the specific reserve for two individually evaluated commercial real estate non-owner occupied relationships.
Previous wording
The following table summarizes the Company’s allocation of the allowance for credit losses under CECL for the years 2021 through 2024 and the allowance for loan losses in 2020:
Current wording
The following table summarizes the Company’s allocation of the allowance for credit losses under CECL for the years 2021 through 2025:
Previous wording
The allowance allocated to each of the four loan categories should not be interpreted as an indication that charge-offs in 2024 occurred in the same proportions or that the allocation indicates future charge-off trends. The allowance allocated to the one-to-four family real estate loan category and the consumer loan category is based upon the Company’s allowance methodology for homogeneous loans, and increases and decreases in the balances of those portfolios. For the commercial real estate and commercial categories, which represent 42.2% and 10.8% of the total loan portfolio in 2024, respectively, management relies on the Bank’s internal loan review procedures and allocates accordingly based on loan classifications. The gross charge-offs in the commercial real estate portfolio, were $4.6 million for 2024, which represented approximately 57.8% of the gross losses for the entire loan portfolio.
Current wording
The allowance allocated to each of the four loan categories should not be interpreted as an indication that charge-offs in 2025 occurred in the same proportions or that the allocation indicates future charge-off trends. The allowance allocated to the one-to-four family real estate loan category and the consumer loan category is based upon the Company’s allowance methodology for homogeneous loans, and increases and decreases in the balances of those portfolios. For the commercial real estate and commercial categories, which represent 42.3% and 10.3% of the total loan portfolio in 2025, respectively, management relies on the Bank’s internal loan review procedures and allocates accordingly based on loan classifications. The gross charge-offs in the commercial real estate portfolio, were $4.6 million for 2025, which represented approximately 60.8% of the gross losses for the entire loan portfolio.
Previous wording
The debt securities available for sale decreased $33.1 million in 2024 to $1.27 billion at December 31, 2024, from $1.30 billion at December 31, 2023. For additional information regarding Farmers’ investment securities see Note 3 to the Consolidated Financial Statements.
Current wording
The debt securities available for sale increased $76.9 million in 2025 to $1.34 billion at December 31, 2025, from $1.27 billion at December 31, 2024. For additional information regarding Farmers’ investment securities see Note 3 to the Consolidated Financial Statements.
Previous wording
Premises and equipment increased $7.9 million from $44.4 million at December 31, 2023, to $52.3 million at December 31, 2024. This increase was primarily due to the construction of additional office space at the Company's headquarters in Canfield, OH, partially offset by depreciation.
Current wording
Premises and equipment increased $4.6 million from $52.3 million at December 31, 2024, to $56.9 million at December 31, 2025. This increase was primarily due to the construction of additional office space at the Company's headquarters in Canfield, OH, partially offset by depreciation.
Previous wording
The Company owns bank owned life insurance policies on the lives of certain members of management. The purpose of this investment is to help offset the costs of employee benefit plans. The cash surrender value of these policies increased to $101.4 million at December 31, 2024, compared to $99.5 million at December 31, 2023. The increase was due to earnings on the policies in 2024 offset slightly by proceeds from a death benefit.
Current wording
The Company owns bank owned life insurance policies on the lives of certain members of management. The purpose of this investment is to help offset the costs of employee benefit plans. The cash surrender value of these policies increased to $119.4 million at December 31, 2025, compared to $101.4 million at December 31, 2024. This increase resulted from the purchase of an additional $15.0 million in policies in 2025.
Previous wording
Uninsured deposits for bank and savings and loan registrants are U.S. federally insured depository institutions as the portion of deposit accounts in U.S. offices that exceed the FDIC insurance limit or similar state deposit insurance regimes and amounts in any other uninsured investment or deposit account that are classified as deposits and not subject to any federal or state deposit insurance regimes. Deposits in amounts in excess of the FDIC insurance limit were $1.42 billion at December 31, 2024.
Current wording
Uninsured deposits for bank and savings and loan registrants are U.S. federally insured depository institutions as the portion of deposit accounts in U.S. offices that exceed the FDIC insurance limit or similar state deposit insurance regimes and amounts in any other uninsured investment or deposit account that are classified as deposits and not subject to any federal or state deposit insurance regimes. Deposits in amounts in excess of the FDIC insurance limit were $1.49 billion, or 33.8% of total deposits at December 31, 2025.
Previous wording
The Company's short-term borrowings decreased by $50.0 million from $355.0 million at December 31, 2023, to $305.0 million at December 31, 2024. This decrease was due to proceeds from the issuance of brokered time deposits being used to pay down short term borrowings. The Company uses short term borrowings to manage the ongoing fluctuations with loans and deposits, when necessary.
Current wording
The Company's short-term borrowings decreased by $24.0 million from $305.0 million at December 31, 2024, to $281.0 million at December 31, 2025. This decrease was funded by the increase in deposits in 2025. The Company uses short term borrowings to manage the ongoing fluctuations with loans and deposits, when necessary.
Previous wording
Total stockholders’ equity increased $1.6 million from $404.4 million at December 31, 2023, to $406.0 million at December 31, 2024. The increase was primarily due to net income of $45.9 million offset by an increase in accumulated other comprehensive loss of $20.7 million and dividends paid on common stock of $25.5 million.
Current wording
Total stockholders’ equity increased $79.7 million from $406.0 million at December 31, 2024, to $485.7 million at December 31, 2025. The increase was primarily due to net income of $54.6 million and a decrease in accumulated other comprehensive loss of $49.2 million offset by dividends paid on common stock of $25.6 million.
Previous wording
There are also $17.1 million of commitments to various partnership investment funds. The Company invests in these funds, consisting of affordable housing tax credit investments and SBIC funds, in efforts to comply with CRA regulations. The commitments have no predetermined due dates but are expected to be funded sporadically over the next ten years. Note 14 to the consolidated financial statements discusses in greater detail other commitments and contingencies and the various obligations that exist under those agreements. Examples of these commitments and contingencies include commitments to extend credit and standby letters of credit.
Current wording
There are also $19.5 million of unfunded commitments to various partnership investment funds. The Company invests in these funds, consisting of affordable housing tax credit investments and SBIC funds, in efforts to comply with CRA regulations. The commitments have no predetermined due dates but are expected to be funded sporadically over the next ten years. Note 14 to the Consolidated Financial Statements discusses in greater detail other commitments and contingencies and the various obligations that exist under those agreements. Examples of these commitments and contingencies include commitments to extend credit and standby letters of credit.
Previous wording
Management’s policy is to not engage in derivatives contracts for speculative trading purposes. The Company does utilize interest-rate swaps as a way of helping manage interest rate risk and not as derivatives for trading purposes. See Note 22 within Item 8 of this Annual report on Form 10-K for additional detail.
Current wording
Management’s policy is to not engage in derivatives contracts for speculative trading purposes. The Company does utilize interest-rate swaps as a way of helping manage interest rate risk and not as derivatives for trading purposes. See Note 22 of the consolidated Financial Statements for additional detail.
Previous wording
For example, compared to the Company’s central scenario that is based on a four-quarter forecasted change in U.S. real GDP of 2.10% from 4Q2024 to 4Q2025, U.S. PCE inflation of 2.50%, and U.S. unemployment of 4.30%, the Company’s relative adverse scenario assumes a four-quarter forecast with a contraction of U.S. real GDP, a PCE inflation between 5.00% and 7.00% and an elevated U.S. unemployment rate between 6.00% and 7.00%. This analysis is not intended to estimate expected future changes in the allowance for credit losses, for a number of reasons, including:
Current wording
For example, compared to the Company’s central scenario that is based on a four-quarter forecasted change in U.S. real GDP of 2.30% from 4Q2025 to 4Q2026, U.S. PCE inflation of 2.40%, and U.S. unemployment of 4.40%, the Company’s relative adverse scenario assumes a four-quarter forecast with a contraction of U.S. real GDP, a PCE inflation between 5.00% and 7.00% and an elevated U.S. unemployment rate between 6.00% and 7.00%. This analysis is not intended to estimate expected future changes in the allowance for credit losses, for a number of reasons, including:
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Rearranged current paragraphs (5)
Current report — wording carried from elsewhere
Interest income on loans increased to $191.0 million for the year ended December 31, 2025, compared to $185.7 million for the year ended December 31, 2024. This increase was due to better yields on loans which increased from 5.76% in 2024 to 5.82% in 2025.
Current report — wording carried from elsewhere
Security losses decreased to $2.2 million during the year ended December 31, 2025, from $2.6 million for the year ended December 31, 2024. The losses in 2025 were due to the Company restructuring securities in order to reinvest the proceeds into securities with a higher yield than those sold.
Current report — wording carried from elsewhere
FDIC insurance and state and local taxes decreased to $4.7 million in 2025 from $5.0 million in 2024. The decline was due to lower FDIC expense as the Company had higher capital levels in 2025 resulting in lower expense.
Current report — wording carried from elsewhere
Total interest income increased from $213.3 million in 2023 to $227.7 million for thetwelve months ended December 31, 2024. The increase was primarily due to an increase in the yield on loans and securities associated with the higher interest rate environment.
Current report — wording carried from elsewhere
Retirement plan consulting fees increased to $2.6 million for 2024 compared to $2.5 million for 2023. The Company picked up additional business in 2024 and with the acquisition of Crest in December of 2024.
Rearranged previous paragraphs (3)
Previous report — wording carried elsewhere
The Company recognized net interest income of $137.8 million for the twelve months ended December 31, 2023, compared to $124.2 million for the twelve months ended December 31, 2022. The tax-equivalent net interest margin declined from 3.18% for 2022 to 2.91% for the year ended December 31, 2023. The margin declined due to increased funding costs associated with the Federal Reserve's aggressive rate increases in 2022 and 2023 along with an inverted U.S treasury yield curve which caused deposit funding costs to rise faster than the yields being earned on loans and securities.
Previous report — wording carried elsewhere
Service charges on deposit accounts totaled $6.3 million in 2023 compared to $4.7 million in 2022. The increase was due to the acquisition of Emclaire.
Previous report — wording carried elsewhere
The net gains on the sale of loans increased by $329,000 between 2022 and 2023. The primary reason for this increase was the sale of nonaccrual commercial loans that generated a gain of $915,000 in 2023 offset by lower gain on sale figures on the sale of 1-4 family mortgage loans. Mortgage volume continues to be negatively impacted by the higher interest rate environment and the lack of supply of homes for sale.