Farmers & Merchants Bank celebrates 100th Anniversary
Twenty farmers and businessmen got together 100 years ago this spring to raise money to open Lodi’s own community bank. The goals were that it would always be locally owned and operated so that its shares would be owned by a broad base of the community; that it would invest in the community to create jobs; and that security would always be a priority.
Bank President and CEO Kent Steinwert says there’s a reason those community-based principles have lasted 100 years.
“When you have ownership, you have a piece of that success,” he said.
The bank opened in August 1916 and soon had $8,000 in deposits. Most of the cash the bank kept back then was in gold and silver coin. Customers with valuables could buy a strong box to keep in the bank’s round vault, a design the bank favored because it was believed to be more difficult to crack.
F&M Bank financed the first paved street in Lodi, School Street, which ran in front of the bank’s first building.
The bank also sold war bonds during the War and withstood the Great Depression with record profits. The Lodi area saw almost no foreclosures, according to Steinwert.
“It was conservative principles and knowing your customer,” he said, pointing out that being small and local allows a community bank to work with its customers when they run into trouble.
The bank didn’t expand until 1948, when it opened a branch in Galt. Another in Linden followed in 1950, and two more in Modesto and Sacramento opened in 1955.
Today, F&M Bank has 24 branches, including several in the East Bay area, where it has plans for further expansion.
The bank has grown into the largest community bank in San Joaquin and Stanislaus counties with $2.6 billion in assets. For the past 81 years, it has paid its shareholders dividends, and for the past 50 of those years those dividends have increased. The bank is one of only 17 publicly traded companies to be dubbed a “Dividend King.”
Like in Lodi, the bank has financed projects that have left lasting impressions in their communities: Stockton’s downtown movie theater complex , its transportation center, University of the Pacific’s baseball stadium, and much of the city’s low and medium-income housing projects.
The bank also prides itself on its non-profit involvement as well. Steinwert said that since 2010, the bank has given $22 million to 250 nonprofits and funded $72 million in community development loans. Employees have also donated 10,000 volunteer hours.
Now the bank has 350 employees, many of whom were hired from the University of the Pacific or Stanislaus State University and then trained in-house. The average tenure for an F&M Bank employee is 12 years.
– Central Valley Business Journal