##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D. C. 20549
 FORM 10-Q
 þ
    
    Quarterly report Under Section 13 or 15(d) of the Securities Exchange Act of 1934
 For the quarterly period ended March 31, 2009.
 o
    
    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
    
    (I.R.S. EmployerIncorporation or Organization)
    
    Identification No.)
 
 
 þ o
 o o
  Large accelerated filer o
Accelerated filer o
Non-accelerated filer o(Do not check if a smaller reporting company)
Smaller reporting Company þ o þ
  Class
    
    Outstanding at May 5, 2009Common Stock, par value  $5
    
    2,287,375 shares




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##### 



F & M BANK CORP.
 Index
 PagePart I
    
    Financial Information
    
    
    2Item 1.
    
    Financial StatementsConsolidated Statements of Income  Three Months
Ended March 31, 2009 and 2008
    
    
    2Consolidated Balance Sheets  March 31, 2009
and December 31, 2008
    
    
    3Consolidated Statements of Cash Flows  Three Months
Ended March 31, 2009 and 2008
    
    
    4Consolidated Statements of Changes in Stockholders
Equity  Three Months March 31, 2009 and 2008
    
    
    5Notes to Consolidated Financial Statements
    
    
    6Item 2.
    
    Managements Discussion and Analysis of
Financial Condition and Results of Operations
    
    
    9Item 3.
    
    Quantitative and Qualitative Disclosures About Market Risk
    
    
    18Item 4T.
    
    Controls and Procedures
    
    
    18Part II
    
    Other Information
    
    
    19Item 1.
    
    Legal Proceedings
    
    
    19Item 1a.
    
    Risk Factors
    
    
    19Item 2.
    
    Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    19Item 3.
    
    Defaults upon Senior Securities
    
    
    19Item 4.
    
    Submission of Matters to a Vote of Security Holders
    
    
    19Item 5.
    
    Other Information
    
    
    19Item 6.
    
    Exhibits
    
    
    19Signatures
    
    
    
    
    20Certifications
    
    
    
    
    21EX-31.1EX-31.2EX-32




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##### Table of Contents



F & M BANK CORP.
Consolidated Statements of Income
(In Thousands of Dollars Except per Share Amounts)
(Unaudited)
 Three Months EndedMarch 31,2009
    
    
    2008Interest incomeInterest and fees on loans held for investment
    
    $
    6,186
    
    
    $
    5,555Interest and fees on loans held for sale
    
    
    227
    
    
    
    21Interest on federal funds sold
    
    
    1
    
    
    
    16Interest on interest bearing deposits
    
    
    14
    
    
    
    53Dividends on equity securities
    
    
    46
    
    
    
    127Interest on debt securities
    
    
    227
    
    
    
    262Total interest income
    
    
    6,701
    
    
    
    6,034Interest expenseInterest on demand deposits
    
    
    234
    
    
    
    218Interest on savings accounts
    
    
    63
    
    
    
    73Interest on time deposits over $100,000
    
    
    559
    
    
    
    514Interest on time deposits
    
    
    1,213
    
    
    
    1,318Total interest on deposits
    
    
    2,069
    
    
    
    2,123Interest on short-term debt
    
    
    28
    
    
    
    77Interest on long-term debt
    
    
    604
    
    
    
    404Total Interest Expense
    
    
    2,701
    
    
    
    2,604Net interest income
    
    
    4,000
    
    
    
    3,430Provision for loan losses
    
    
    210
    
    
    
    90Net interest income after provision for loan losses
    
    
    3,790
    
    
    
    3,340Noninterest incomeService charges
    
    
    286
    
    
    
    304Insurance and other commissions
    
    
    102
    
    
    
    55Other
    
    
    189
    
    
    
    251Income on bank owned life insurance
    
    
    90
    
    
    
    73Security gains (losses)
    
    
    (330
    )
    
    
    (2
    )Total noninterest income
    
    
    337
    
    
    
    681Noninterest expenseSalaries
    
    
    1,236
    
    
    
    1,248Employee benefits
    
    
    428
    
    
    
    352Occupancy expense
    
    
    139
    
    
    
    141Equipment expense
    
    
    132
    
    
    
    133Intangible amortization
    
    
    69
    
    
    
    69Other
    
    
    790
    
    
    
    710Total noninterest expense
    
    
    2,794
    
    
    
    2,653Income before income taxes
    
    
    1,333
    
    
    
    1,368Income taxes
    
    
    432
    
    
    
    364Minority interest in consolidated subsidiary (earnings) losses
    
    
    (17
    )Net income
    
    $
    884
    
    
    $
    1,004Per share dataNet income
    
    $
    .39
    
    
    $
    .43Cash dividends
    
    $
    .23
    
    
    $
    .22Weighted average shares outstanding
    
    
    2,288,563
    
    
    
    2,337,493
 The accompanying notes are an integral part of these statements.
 2




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##### Table of Contents



F & M BANK CORP.
Consolidated Balance Sheets
(In Thousands of Dollars)
 March 31,
    
    
    December 31,2009
    
    
    2008(Unaudited)
    
    (Audited)AssetsCash and due from banks
    
    $
    4,813
    
    
    $
    5,687Federal funds sold
    
    
    1,458
    
    
    
    8,979Cash and cash equivalents
    
    
    6,271
    
    
    
    14,666Interest bearing deposits in banks
    
    
    1,413
    
    
    
    1,162Securities:Held to maturity  fair value of $110,000 in 2009
and 2008, respectively (note 2)
    
    
    110
    
    
    
    110Available for sale (note 2)
    
    
    20,890
    
    
    
    22,237Other investments
    
    
    9,055
    
    
    
    8,439Loans held for sale
    
    
    19,717
    
    
    
    3,780Loans held for investment (note 3)
    
    
    408,766
    
    
    
    399,233Less allowance for loan losses (note 4)
    
    
    (2,381
    )
    
    
    (2,189
    )Net loans held for investment
    
    
    406,385
    
    
    
    397,044Bank premises and equipment
    
    
    7,396
    
    
    
    7,457Interest receivable
    
    
    2,065
    
    
    
    2,056Core deposit intangible
    
    
    529
    
    
    
    598Goodwill
    
    
    2,670
    
    
    
    2,670Bank owned life insurance
    
    
    6,375
    
    
    
    6,304Other assets
    
    
    5,306
    
    
    
    5,535Total assets
    
    $
    488,182
    
    
    $
    472,058LiabilitiesDeposits:Noninterest bearing
    
    $
    49,449
    
    
    $
    49,786Interest bearing:Demand
    
    
    45,385
    
    
    
    39,773Money market accounts
    
    
    21,752
    
    
    
    22,779Savings
    
    
    31,841
    
    
    
    29,367Time deposits over $100,000 (note 8)
    
    
    76,825
    
    
    
    63,855All other time deposits (note 8)
    
    
    139,071
    
    
    
    136,665Total deposits
    
    
    364,323
    
    
    
    342,225Short-term debt
    
    
    13,675
    
    
    
    20,510Accrued liabilities
    
    
    7,578
    
    
    
    7,687Long-term debt
    
    
    66,378
    
    
    
    65,331Total liabilities
    
    
    451,954
    
    
    
    435,753Minority interest in consolidated subsidiary
    
    
    64
    
    
    
    47Stockholders EquityCommon stock, $5 par value, 6,000,000 shares authorized,
2,287,375 and 2,289,497 shares issued and outstanding
in 2009 and 2008, respectively
    
    
    11,437
    
    
    
    11,447Retained earnings
    
    
    27,999
    
    
    
    27,687Accumulated other comprehensive income (loss)
    
    
    (3,272
    )
    
    
    (2,876
    )Total stockholders equity
    
    
    36,164
    
    
    
    36,258Total liabilities and stockholders equity
    
    $
    488,182
    
    
    $
    472,058
 The accompanying notes are an integral part of these statements.
 3




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F & M BANK CORP.
Consolidated Statements of Cash Flows
(In Thousands of Dollars)
(Unaudited)
 Three Months EndedMarch 31,2009
    
    
    2008Cash flows from operating activitiesNet income
    
    $
    884
    
    
    $
    1,004Adjustments to reconcile net income to net
cash provided by operating activities:Depreciation
    
    
    158
    
    
    
    156Amortization (accretion) of security premiums (discounts)
    
    
    11
    
    
    
    (12
    )Net (increase) decrease in loans held for sale
    
    
    (15,937
    )
    
    
    (7,002
    )Provision for loan losses
    
    
    210
    
    
    
    90Intangible amortization
    
    
    69
    
    
    
    69(Increase) decrease in interest receivable
    
    
    (9
    )
    
    
    295Decrease in other assets
    
    
    357
    
    
    
    343Increase in accrued expenses
    
    
    (114
    )
    
    
    (461
    )Gain on security transactions
    
    
    330
    
    
    
    2Amortization of limited partnership investments
    
    
    93
    
    
    
    121Income from life insurance investment
    
    
    (71
    )
    
    
    (73
    )Net adjustments
    
    
    (14,903
    )
    
    
    (6,472
    )Net cash provided by operating activities
    
    
    (14,019
    )
    
    
    (5,468
    )Cash flows from investing activitiesPurchase of investments available for sale
    
    
    (736
    )
    
    
    (7,666
    )Proceeds from sales of investments available for sale
    
    
    4
    
    
    
    95Proceeds from maturity of investments available for sale
    
    
    529
    
    
    
    11,403Proceeds from maturity of investments held to maturityNet increase in loans held for investment
    
    
    (9,552
    )
    
    
    (11,033
    )Purchase of property and equipment
    
    
    (97
    )
    
    
    (345
    )Change in federal funds sold
    
    
    7,521
    
    
    
    (317
    )Net (increase) decrease in interest bearing bank deposits
    
    
    (251
    )
    
    
    986Net cash used in investing activities
    
    
    (2,582
    )
    
    
    (6,877
    )Cash flows from financing activitiesNet change in demand and savings deposits
    
    
    6,722
    
    
    
    3,834Net change in time deposits
    
    
    15,375
    
    
    
    (2,051
    )Net change in short-term debt
    
    
    (6,836
    )
    
    
    (1,400
    )Cash dividends paid
    
    
    (528
    )
    
    
    (520
    )Repurchase of common stock
    
    
    (54
    )
    
    
    (364
    )Proceeds from sale of common stockChange in federal funds purchased
    
    
    
    
    
    
    (2,932
    )Proceeds of long-term debt
    
    
    7,250
    
    
    
    16,000Repayment of long-term debt
    
    
    (6,202
    )
    
    
    (893
    )Net cash provided (used) by financing activities
    
    
    15,727
    
    
    
    11,674Net Increase (Decrease) in Cash and Cash Equivalents
    
    
    (874
    )
    
    
    (671
    )Cash and cash equivalents, beginning of period
    
    
    5,687
    
    
    
    8,706Cash and cash equivalents, end of period
    
    $
    4,813
    
    
    $
    8,035Supplemental disclosureCash paid for:Interest expense
    
    $
    2,805
    
    
    $
    2,708Income taxes
    
    
    
    
    
    
    100
 The accompanying notes are an integral part of these statements.
 4




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F & M BANK CORP.
Consolidated Statements of Changes in Stockholders Equity
(In Thousands of Dollars)
(Unaudited)
 Three Months EndedMarch 31,2009
    
    
    2008Balance, beginning of period
    
    $
    36,258
    
    
    $
    39,165Comprehensive incomeNet income
    
    
    884
    
    
    
    1,004Net change in unrealized appreciation on securities
available for sale, net of taxes
    
    
    (396
    )
    
    
    (388
    )Total comprehensive income
    
    
    488
    
    
    
    616Issuance of Common StockRepurchase of common stock
    
    
    (54
    )
    
    
    (364
    )Dividends declared
    
    
    (528
    )
    
    
    (515
    )Balance, end of period
    
    $
    36,164
    
    
    $
    38,902
 The accompanying notes are an integral part of these statements.
 5




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##### Table of Contents



F & M BANK CORP.
Notes to Consolidated Financial Statements
 Note 1. Accounting Principles
    Note 2. Investment Securities:
  2009
    
    
    2008Market
    
    
    
    
    
    
    MarketCost
    
    
    Value
    
    
    Cost
    
    
    ValueSecurities held to maturityU. S. Treasury and agency obligations
    
    $
    110
    
    
    $
    110
    
    
    $
    110
    
    
    $
    110Total
    
    $
    110
    
    
    $
    110
    
    
    $
    110
    
    
    $
    110
 2009
    
    
    2008Market
    
    
    
    
    
    
    MarketValue
    
    
    Cost
    
    
    Value
    
    
    CostSecurities available for saleGovernment sponsored enterprises
    
    $
    10,175
    
    
    $
    10,002
    
    
    $
    10,194
    
    
    $
    10,013Equity securities
    
    
    2,222
    
    
    
    5,453
    
    
    
    3,064
    
    
    
    5,430Mortgage-backed securities
    
    
    8,140
    
    
    
    7,862
    
    
    
    8,573
    
    
    
    8,391Corporate Bonds
    
    
    228
    
    
    
    281
    
    
    
    281
    
    
    
    281Municipals
    
    
    125
    
    
    
    125
    
    
    
    125
    
    
    
    125Total
    
    $
    20,890
    
    
    $
    23,723
    
    
    $
    22,237
    
    
    $
    24,240
 Note 3. Loans Held for Investment:
  2009
    
    
    2008Real EstateConstruction
    
    $
    76,068
    
    
    $
    71,259Residential
    
    
    173,720
    
    
    
    169,122Commercial and agricultural
    
    
    134,933
    
    
    
    134,008Installment loans to individuals
    
    
    22,126
    
    
    
    22,792Credit cards
    
    
    1,816
    
    
    
    1,940Other
    
    
    103
    
    
    
    112Total
    
    $
    408,766
    
    
    $
    399,233
 6




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##### Table of Contents



F & M BANK CORP.
Notes to Consolidated Financial Statements
 Note
4. Allowance for Loan Losses:
  Three Months EndedMarch 31,2009
    
    
    2008Balance, beginning of period
    
    $
    2,189
    
    
    $
    1,703Provisions charged to operating expenses
    
    
    210
    
    
    
    90Net (charge-offs) recoveries:Loan recoveries
    
    
    12
    
    
    
    21Loan charge-offs
    
    
    (30
    )
    
    
    (283
    )Total Net (Charge-Offs) Recoveries*
    
    
    (18
    )
    
    
    (262
    )Balance, End of Period
    
    $
    2,381
    
    
    $
    1,531
 *
    
    Components of Net (Charge-Offs) Recoveries Real EstateCommercial
    
    
    
    
    
    
    258Installment
    
    
    18
    
    
    
    4Total
    
    $
    18
    
    
    $
    262
 Note 5. Employee Benefit Plan
  2009
    
    
    2008Service cost
    
    $
    89,700
    
    
    $
    80,595Interest cost
    
    
    68,333
    
    
    
    64,054Expected return on plan assets
    
    
    (78,428
    )
    
    
    (94,178
    )Amortization of net obligation at transitionAmortization of prior service cost
    
    
    (1,325
    )
    
    
    (1,325
    )Amortization of net (gain) or loss
    
    
    31,051
    
    
    
    2,947Net periodic benefit cost
    
    $
    109,331
    
    
    $
    52,093
 Note 6 Fair Value
  Level
1
 Level
2
 Level 3 
 7




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F & M BANK CORP.
Notes to Consolidated Financial Statements
 Note 6 Fair Value, continued
     Assets and Liabilities Recorded at Fair Value on a Recurring Basis
  March 31, 2009
    
    Total
    
    Level 1
    
    Level 2
    
    Level 3Investment securities available-for-sale
    
    $
    20,890
    
    
    $
    2,222
    
    
    $
    18,668Loans held for sale
    
    
    19,717
    
    
    
    
    
    
    
    19,717Impaired loans
    
    
    2,330
    
    
    
    
    
    
    
    2,330Total assets at fair value
    
    
    44,607
    
    
    
    2,222
    
    
    
    42,385Total liabilities at fair value
  
 8




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Item 2. Managements Discussion and Analysis of Financial Condition and Results of
Operations
     Forward-Looking Statements
    9




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##### Table of Contents



Item 2. Managements Discussion and Analysis of Financial Condition and Results of
Operations (Continued)
 Critical Accounting Policies
 General
  Allowance for Loan Losses
 , ,
 Goodwill and Intangibles
 Business Combinations Goodwill and Other
Intangible Assets
  Securities Impairment
 Accounting for Certain Investments in Debt and Equity Securities.
 10




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##### Table of Contents



Item 2. Managements Discussion and Analysis of Financial Condition and Results of
Operations (Continued)
 Overview
  Results of Operations
      Financial Condition
 Federal Funds Sold and Interest Bearing Bank Deposits
  Securities
  11




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Item 2. Managements Discussion and Analysis of Financial Condition and Results of
Operations (Continued)
      Loan Portfolio
    12




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Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
(Continued)
   March 31,
    
    
    December 31,2009
    
    
    2008Nonaccrual loans
    
    $
    1,518
    
    
    $
    1,374Loans past due 90 days or more
and still accruing interest
    
    
    3,443
    
    
    
    3,392$
    4,961
    
    
    $
    4,766As a percentage of loans held for investment
    
    
    1.21
    %
    
    
    1.19
    %
 Allowance for Loan Losses
      13




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Item 2.
    
    Managements Discussion and Analysis of Financial Condition and Results of Operations (Continued)
   Deposits and Other Borrowings
  Short-term debt
  Long-term debt
   14




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Item 2.
    
    Managements Discussion and Analysis of Financial Condition and Results of
Operations (Continued)
 Capital
  Liquidity
   Interest Rate Sensitivity
    Stock Repurchase
  Effect of Newly Issued Accounting Standards
  Existence of Securities and Exchange Commission Web Site
  15




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##### Table of Contents



TABLE 1
 F & M BANK CORP.
Net Interest Margin Analysis
(on a fully taxable equivalent basis)
(Dollar Amounts in Thousands)
 Three Months Ended
    
    
    Three Months EndedMarch 31, 2009
    
    
    March 31, 2008Average
    
    
    Income/
    
    
    
    
    
    
    Average
    
    
    Income/Balance2
    
    
    Expense
    
    
    Rates
    
    
    Balance2
    
    
    Expense
    
    
    RatesInterest incomeLoans held for investment1,2
    
    $
    403,984
    
    
    $
    6,219
    
    
    
    6.16
    %
    
    $
    322,204
    
    
    $
    5,585
    
    
    
    6.95
    %Loans held for sale
    
    
    23,204
    
    
    
    227
    
    
    
    3.91
    %
    
    
    1,725
    
    
    
    21
    
    
    
    4.88
    %Federal funds sold
    
    
    2,089
    
    
    
    1
    
    
    
    .19
    %
    
    
    2,418
    
    
    
    16
    
    
    
    2.65
    %Interest bearing deposits
    
    
    1,306
    
    
    
    13
    
    
    
    3.98
    %
    
    
    4,237
    
    
    
    53
    
    
    
    5.02
    %InvestmentsTaxable 3
    
    
    18,304
    
    
    
    225
    
    
    
    4.92
    %
    
    
    21,174
    
    
    
    287
    
    
    
    5.42
    %Partially taxable
    
    
    2,902
    
    
    
    59
    
    
    
    8.13
    %
    
    
    5,887
    
    
    
    132
    
    
    
    8.97
    %Tax exempt 2,3
    
    
    125
    
    
    
    3
    
    
    
    9.70
    %
    
    
    250
    
    
    
    3
    
    
    
    4.80
    %Total earning assets
    
    $
    451,914
    
    
    $
    6,747
    
    
    
    5.97
    %
    
    $
    357,895
    
    
    $
    6,097
    
    
    
    6.83
    %Interest ExpenseDemand deposits
    
    
    63,884
    
    
    
    234
    
    
    
    1.47
    %
    
    
    56,397
    
    
    
    218
    
    
    
    1.55
    %Savings
    
    
    30,168
    
    
    
    63
    
    
    
    .84
    %
    
    
    28,690
    
    
    
    73
    
    
    
    1.02
    %Time deposits
    
    
    209,334
    
    
    
    1,772
    
    
    
    3.39
    %
    
    
    165,042
    
    
    
    1,832
    
    
    
    4.45
    %Short-term debt
    
    
    20,246
    
    
    
    28
    
    
    
    .55
    %
    
    
    10,731
    
    
    
    77
    
    
    
    2.88
    %Long-term debt
    
    
    70,785
    
    
    
    604
    
    
    
    3.41
    %
    
    
    41,197
    
    
    
    404
    
    
    
    3.93
    %Total interest bearing liabilities
    
    $
    394,417
    
    
    $
    2,701
    
    
    
    2.74
    %
    
    $
    302,057
    
    
    $
    2,604
    
    
    
    3.46
    %Net interest margin 1
    
    
    
    
    
    $
    4,046
    
    
    
    
    
    
    
    
    
    
    $
    3,493Net yield on interest earning assets
    
    
    
    
    
    
    
    
    
    
    3.58
    %
    
    
    
    
    
    
    
    
    
    
    3.91
    %
 
 1
    
    Interest income on loans includes loan fees.2
    
    An incremental income tax rate of 34% was used to calculate the tax equivalent income
on nontaxable and partially taxable investments and loans.3
    
    Average balance information is reflective of historical cost and has not been adjusted
for changes in market value. 16




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##### Table of Contents



TABLE II
 F & M BANK CORP.
Interest Sensitivity Analysis
March 31, 2009
(In Thousands of Dollars)
  0 - 3
    
    
    4 - 12
    
    
    1 - 5
    
    
    Over 5
    
    
    NotMonths
    
    
    Months
    
    
    Years
    
    
    Years
    
    
    Classified
    
    
    TotalUses of fundsLoansCommercial
    
    $
    100,778
    
    
    $
    15,258
    
    
    $
    87,281
    
    
    $
    7,055
    
    
    $
    
    
    
    $
    210,372Installment
    
    
    8,946
    
    
    
    1,363
    
    
    
    9,662
    
    
    
    2,363
    
    
    
    
    
    
    
    22,334Real estate for investments
    
    
    36,194
    
    
    
    16,348
    
    
    
    101,732
    
    
    
    19,970
    
    
    
    
    
    
    
    174,244Real estate held for sale
    
    
    19,717
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    19,717Credit cards
    
    
    1,816
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,816Federal funs sold
    
    
    1,458
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,458Interest bearing bank deposits
    
    
    1,017
    
    
    
    396
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,413Investment securities
    
    
    2,329
    
    
    
    2,309
    
    
    
    6,129
    
    
    
    7,783
    
    
    
    2,450
    
    
    
    21,000Total
    
    
    172,255
    
    
    
    35,674
    
    
    
    204,804
    
    
    
    37,171
    
    
    
    2,450
    
    
    
    452,354Sources of fundsInterest bearing demand deposits
    
    
    
    
    
    
    19,953
    
    
    
    38,107
    
    
    
    9,077
    
    
    
    
    
    
    
    67,137Savings deposits
    
    
    
    
    
    
    6,368
    
    
    
    19,105
    
    
    
    6,368
    
    
    
    
    
    
    
    31,841Certificates of deposit
$100,000 and over
    
    
    19,112
    
    
    
    35,110
    
    
    
    22,603
    
    
    
    
    
    
    
    
    
    
    
    76,825Other certificates of deposit
    
    
    21,854
    
    
    
    55,920
    
    
    
    61,296
    
    
    
    
    
    
    
    
    
    
    
    139,070Short-term borrowings
    
    
    13,675
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    13,675Long-term borrowings
    
    
    36,021
    
    
    
    17,857
    
    
    
    12,500
    
    
    
    
    
    
    
    
    
    
    
    66,378Total
    
    $
    90,662
    
    
    $
    135,208
    
    
    $
    153,611
    
    
    $
    15,445
    
    
    $
    
    
    
    $
    394,926Discrete Gap
    
    
    81,593
    
    
    
    (99,534
    )
    
    
    51,193
    
    
    
    21,726
    
    
    
    2,450
    
    
    
    57,428Cumulative Gap
    
    
    81,593
    
    
    
    (17,941
    )
    
    
    33,252
    
    
    
    54,978
    
    
    
    57,428Ratio of CumulativeGap to Total Earning Assets
    
    
    18.04
    %
    
    
    (3.97
    %)
    
    
    7.35
    %
    
    
    12.15
    %
    
    
    12.70
    %
 
 Table II reflects the earlier of the maturity or repricing dates for various assets and
liabilities as of March 31, 2009. In preparing the above table, no assumptions were made with
respect to loan prepayments. Loan principal payments are included in the earliest period in which
the loan matures or can reprice. Principal payments on installment loans scheduled prior to
maturity are included in the period of maturity or repricing. Proceeds from the redemption of
investments and deposits are included in the period of maturity. Estimated maturities of deposits,
which have no stated maturity dates, were derived from guidance contained in FDICIA 305. 17




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##### Table of Contents



Item 3. Quantitative and Qualitative Disclosures About Market Risk
  
 Item 4T. Controls and Procedures
 Evaluation of Disclosure Controls and Procedures
    Changes in Internal Controls
  18




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##### Table of Contents



Part II Other Information
 
 Item 1.
    Legal Proceedings 
    Not Applicable
 
 Item 1a.
    Risk Factors  There have been no material changes from the risk factors previously
disclosed in Item 1a of the Corporations Form 10k filed on March 26, 2009.
 
 Item 2.
    Unregistered Sales of Equity Securities and Use of Proceeds 
    Not Applicable
 
 Item 3.
    Defaults Upon Senior Securities 
    Not Applicable
 
 Item 4.
    Submission of Matters to a Vote of Security Holders
    Not Applicable
 
 Item 5.
    Other Information 
    Not Applicable
 
 Item 6.
    Exhibits
 (a)
    
    Exhibits
 3 i
    
    Restated Articles of Incorporation of F & M
Bank Corp. are incorporated by reference to Exhibits to F & M Bank
Corp.s 2001 Form 10K filed March 1, 2002.3 ii
    
    Amended and Restated Bylaws of F & M Bank
Corp. are incorporated by reference to Exhibits to F & M Bank Corp.s
Form 10K filed March 1, 2002.31.1
    
    Certification of Chief Executive Officer
pursuant to Rule 13a-14(a) (filed herewith).31.2
    
    Certification of Chief Financial Officer
pursuant to Rule 13a-14(a) (filed herewith).32
    
    Certifications of Chief Executive Officer and
Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sabanes-Oxley Act of 2002 (filed
herewith).
 19




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##### Table of Contents



Signatures
  F & M BANK CORP./s/ DEAN W. WITHERSDean W. WithersPresident and Chief Executive Officer/s/ NEIL W. HAYSLETTNeil W. HayslettExecutive Vice President and Chief Financial Officer  20