United States

SECURITIES AND EXCHANGE COMMISSION

Washington, D. C. 20549

FORM 10-Q

Mark One

[X] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the quarterly period ended March 31, 2004

or

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

For the transition period from ___________ to ___________

Commission File Number: _0-10972_

 
 
______________________First Farmers and Merchants Corporation_____________________
(Exact name of registrant as specified in its charter)
 
___________________Tennessee_____________________
_______62-1148660_______
(State or other jurisdiction of incorporation or organization)
(I.R.S. Employer Identification No.)
 
 
816 South Garden Street
 
____________Columbia, Tennessee____________
_______38402 - 1148_______
(Address of principal executive offices)
(Zip Code)
____________________________(931) 388-3145_____________________________
(Registrant's telephone number, including area code)
 
___________________________Not Applicable______________________________
(Former name, former address and former fiscal year, if changed since last report)

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 X No 

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act) Yes __X__ No _____

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. __5,840,000 shares as of April 30, 2004__

 

PART 1 - FINANCIAL INFORMATION

 
**Item 1. Financial Statements**
 

The following unaudited consolidated financial statements of the Registrant and its subsidiary are included in this Report:
 
Consolidated balance sheets - March 31, 2004, and December 31, 2003.
 
Consolidated statements of income - For the three months ended March 31, 2004, and March 31, 2003.
 
Consolidated statements of cash flows - For the three months ended March 31, 2004, and March 31, 2003.
 
Selected notes to consolidated financial statements.

 

 

 

 

 

 

**FIRST FARMERS AND MERCHANTS CORPORATION AND SUBSIDIARY**CONSOLIDATED BALANCE SHEETS**March 31
December 31
 
(Dollars in Thousands)** **2004
 
2003**(Unaudited)
(1)**ASSETS
Cash and due from banks**$**21,942 
$ 
26,137 
Interest-bearing deposits in banks**297 
297 
Federal funds sold**10,800 
12,000 
Total cash and cash equivalents**33,039 
38,434 
Securities
Available for sale (amortized cost $247,305
and $243,038, respectively)**255,100 
249,653 
Held to maturity (fair value $83,5570
and $84,199, respectively)**77,946 
79,138 
Total securities**333,046 
328,791 
Loans, net of deferred fees**417,024 
424,504 
Allowance for possible loan losses **(9,158)
(10,123)
Net loans**407,866 
414,381 
Bank premises and equipment, at cost
less allowance for depreciation**12,964 
12,997 
Core deposit and other intangibles**12,779 
13,042 
Other assets**20,707 
21,168 ** 
TOTAL ASSETS**$**820,401 
$ 
828,813 **LIABILITIES
Deposits
Noninterest-bearing**$**111,733 
$ 
112,334 
Interest-bearing (including certificates of deposit
over $100,000: 2004 - $87,698; 2003 - $91,783)**594,709 
604,099 
Total deposits**706,442 
716,433 
Federal funds purchased and securities sold
under agreements to repurchase**1,865 
1,820 
Dividends payable**- 
1,635 
Other short term liabilities**640 
648 
Accounts payable and accrued liabilities**5,992 
5,992 ** 
TOTAL LIABILITIES** **714,939 
 
726,528 **SHAREHOLDERS'
Common stock - $10 par value, 8,000,000 shares**EQUITY
authorized; issued and outstanding -
5,840,000**29,200 
29,200 
Additional paid-in capital**4,320 
4,320 
Retained earnings **67,158 
64,698 
Accumulated other comprehensive income**4,784 
4,067 
TOTAL SHAREHOLDERS' EQUITY**105,462 
102,285 
TOTAL LIABILITIES AND** 
SHAREHOLDERS' EQUITY**$**820,401 
$ 
828,813 
(1) Derived from audited financial statements.
The accompanying notes are an integral part of the consolidated financial statements.

 

 

**FIRST FARMERS AND MERCHANTS CORPORATION AND SUBSIDIARY **CONSOLIDATED STATEMENTS OF INCOME 
(Unaudited)
(Dollars In Thousands, Except Per Share Data)** 
Three Months Ended March 31, 
 **2004
 
2003**INTEREST INCOME
Interest and fees on loans
$ **6,050 
$ 
7,670 
Income on investment securities
Taxable interest**2,710 
2,876 
Exempt from federal income tax**625 
746 
Dividends**27 
25 **3,362 
3,647 
Other interest income**30 
78 ** 
TOTAL INTEREST INCOME
 **9,442 
 
11,395 **INTEREST EXPENSE 
Interest on deposits**2,186 
3,304 
Interest on other short-term borrowings**3 
7 
TOTAL INTEREST EXPENSE**2,189 
3,311 
NET INTEREST INCOME**7,253 
8,084 
PROVISION FOR POSSIBLE LOAN LOSSES**- 
410 
NET INTEREST INCOME AFTER** 
PROVISION FOR LOAN LOSSES
 **7,253 
 
7,674 **NONINTEREST INCOME
Trust department income**523 
467 
Service fees on deposit accounts**1,713 
1,774 
Other service fees, commissions, and fees**97 
96 
Other operating income**400 
238 
Securities gains**917 
- ** 
TOTAL NONINTEREST INCOME
 **3,650 
 
2,575 **NONINTEREST EXPENSES
Salaries and employee benefits**3,986 
3,695 
Net occupancy expense**573 
500 
Furniture and equipment expense**343 
366 
Other operating expenses**2,558 
2,550 
TOTAL NONINTEREST EXPENSES**7,460 
7,111 
INCOME BEFORE PROVISION FOR
INCOME TAXES**3,443 
3,138 ** 
PROVISION FOR INCOME TAXES
 **982 
 
674 ** 
NET INCOME 
$ **2,461 
$ 
2,464 **EARNINGS PER SHARE
Common stock 
(Weighted average shares outstanding:** 
5,840,000 in 2004 and 2003)
$**0.42
$
0.42
The accompanying notes are an integral part of the consolidated financial statements.

 

 

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