Breaking Down Richmond Mutual Bancorporation, Inc. (RMBI) Financial Health: Key Insights for Investors

You're looking at Richmond Mutual Bancorporation, Inc. (RMBI) right now and trying to figure out if their recent performance is a durable trend or just a blip, especially with the banking sector's rate volatility. Honestly, the numbers from the third quarter of 2025 tell a clear story of execution: the company posted net income of $3.6 million, translating to $0.37 diluted earnings per share, which is a solid 42% jump from the prior quarter. That kind of margin expansion is defintely a win in this environment. Here's the quick math: they managed to grow their total assets to $1.5 billion as of September 30, 2025, while simultaneously pushing their net interest margin (NIM) up to 3.07% for the quarter, largely by optimizing their loan portfolio, which now sits at roughly $1.2 billion net of allowance. Plus, the recent definitive agreement to acquire Farmers Bancorp for $85.1 million signals a major push for scale, but it also means near-term integration risk you need to model. The question isn't just about the past quarter's $11.3 million in net interest income; it's about how they manage that growth while keeping nonaccrual loans-which rose to $6,381,000-in check. Let's dive into the full financial statement to map out the next move.

Revenue Analysis

If you are looking at Richmond Mutual Bancorporation, Inc. (RMBI), the direct takeaway is clear: the revenue engine is highly reliant on core lending activities, and that engine is running hotter in 2025. The company's financial health is primarily driven by its Net Interest Income (NII), which saw a substantial year-over-year increase, signaling effective rate management in a challenging environment.

Richmond Mutual Bancorporation operates squarely in the community banking segment, which means its revenue is split into two main streams: Net Interest Income and Noninterest Income. For the third quarter of 2025, the vast majority-nearly 90%-of its revenue came from the spread between what it earns on loans and what it pays on deposits. That's a defintely traditional bank model.

The primary revenue source, Net Interest Income (NII)-the difference between interest earned on assets and interest paid on liabilities-was $11.3 million for the third quarter of 2025. This is the core of their business, generated mainly from interest on their loan and lease portfolio, which totaled $1.2 billion as of September 30, 2025.

Noninterest Income, which covers fees and other services, contributed $1.3 million in Q3 2025. This segment includes service charges on deposit accounts, card fee income, and wealth management income. While important for diversification, it remains a smaller piece of the pie.

Here's the quick math on the year-over-year growth for the third quarter, which shows where the real opportunity is:

The 19.7% surge in Net Interest Income is the key story for 2025. This growth was largely driven by an expanded net interest margin (NIM), which hit 3.07% in the third quarter of 2025, up significantly from 2.60% a year prior. This shows management's ability to successfully reprice assets faster than liabilities, a critical move in a rising-rate environment.

To be fair, Noninterest Income saw a slight 2.0% decrease year-over-year, which is mostly a function of reduced mortgage banking activity and net gains on loan and lease sales compared to previous periods. Still, the core fee income from service charges and wealth management is trending up. You can see the foundational principles driving these decisions in the Mission Statement, Vision, & Core Values of Richmond Mutual Bancorporation, Inc. (RMBI).

The company's growth strategy is geographically focused on areas with strong commercial activity and population growth, which directly fuels their primary revenue stream (NII) through loan demand.

• Columbus, Ohio
• Cincinnati/Dayton/Springfield, Ohio
• Indianapolis, Indiana

This strategic focus on above-average growth markets, plus the enhanced NIM, points to a disciplined approach that should continue to drive NII growth, even as noninterest revenue remains a secondary focus.

Profitability Metrics

You need to know if Richmond Mutual Bancorporation, Inc. (RMBI) is turning its core business into real profit, and the short answer is yes-with a clear, upward trend in 2025, though its core lending margin still trails the community bank average. The company's net income climbed significantly through the first three quarters of the year, driven by an expanding Net Interest Margin (NIM), the most crucial profitability metric for a bank.

Looking at the second quarter of 2025, the core profitability metrics show a solid conversion of revenue into profit, even with the non-standard nature of a bank's income statement. Here's the quick math using the quarter ended June 30, 2025, on total revenue of $22.43 million:

• Gross Profit Margin: The $11.84 million in Gross Profit translated to a 52.79% margin.
• Operating Profit Margin: Operating Income of $2.98 million resulted in a 13.29% margin, reflecting the impact of operating expenses.
• Net Profit Margin (Quarterly): Net Income of $2.60 million yielded an 11.59% quarterly net margin.

To be fair, the trailing twelve-month (TTM) Net Profit Margin ending in Q3 2025 was a much stronger 23.7%, up from 20.9% a year prior, which reinforces the narrative of rising profitability.

Profitability Trends and Operational Efficiency

The most important trend is the consistent quarter-over-quarter growth in net income and the Net Interest Margin (NIM), which is the difference between interest earned on assets (like loans) and interest paid on liabilities (like deposits). This is defintely where the long-term value is built for a community bank.

The company's net income has shown a strong sequential increase throughout 2025, largely due to the widening NIM and careful expense management.

This shows a clear, positive trajectory, with net income jumping 42% from Q2 to Q3 2025 alone. This operational efficiency is driven by the average yield on interest-earning assets rising faster than the rate paid on interest-bearing liabilities, which is the core of smart asset-liability management in a rising rate environment.

Benchmarking Against the Industry

When we compare Richmond Mutual Bancorporation, Inc. (RMBI) to its peers, the picture is one of strong relative value but a lagging core lending margin. The company's annualized NIM of 3.07% in Q3 2025 is below the community bank industry average, which stood at 3.62% in the second quarter of 2025. That gap highlights a key opportunity or a structural challenge in their loan or funding mix that management must address to maximize core profitability.

Still, the market values RMBI favorably compared to its direct peers. Its Price-to-Earnings (P/E) Ratio of 12.1x is comfortably lower than the peer average of 26.8x, though it is slightly above the broader US Banks industry average of 11.2x. This suggests investors are paying a premium over the sector average, but a deep discount compared to the most comparable companies, likely due to the strong 23.7% TTM Net Profit Margin and the robust earnings growth of 20.4% over the last year. For a deeper look into the ownership structure, you can read Exploring Richmond Mutual Bancorporation, Inc. (RMBI) Investor Profile: Who's Buying and Why?.

Debt vs. Equity Structure

You're looking at Richmond Mutual Bancorporation, Inc. (RMBI) and trying to figure out how they fund their operations-is it mostly debt or shareholder money? For a bank, the answer is always heavily tilted toward debt, but you need to look at the type of debt. The company's capital structure as of September 30, 2025, shows a high leverage ratio, which is normal for the industry, but they are also actively managing their equity base.

As a regional bank, Richmond Mutual Bancorporation, Inc.'s primary liability is customer deposits, which are technically classified as debt on the balance sheet. This is why their Debt-to-Equity (D/E) ratio looks so high compared to, say, a manufacturing company. Based on the third quarter of 2025, the company's total assets were approximately $1.5 billion, and stockholders' equity stood at $140.0 million. This implies total liabilities (debt, including deposits) of around $1.385.6 million.

Here's the quick math: Richmond Mutual Bancorporation, Inc.'s Debt-to-Equity ratio as of June 30, 2025, was cited at 10.39. This is a massive number if you're used to non-financial companies, where a D/E of 1.5 or 2.0 is often a red flag. But for a regional bank, this is a standard operating model, reflecting the deposits they hold. For context, the industry average D/E for a regional bank is often cited around 0.5 to 0.6 when excluding deposits from the debt calculation, but including them, the number soars. The key is that their equity-to-assets ratio was a healthy 9.18% as of September 30, 2025, which is a better measure of a bank's capital cushion.

• Total Assets (9/30/2025): $1.5 billion
• Stockholders' Equity (9/30/2025): $140.0 million
• Equity-to-Assets Ratio: 9.18%

The company's more traditional, non-deposit debt financing is diversified. As of September 30, 2025, Richmond Mutual Bancorporation, Inc. had $254,000,000 in Federal Home Loan Bank (FHLB) advances, which is a form of secured, typically longer-term, borrowing. The average rate paid on these FHLB borrowings for the third quarter of 2025 was 4.16%, showing the current cost of their wholesale funding.

On the equity side, Richmond Mutual Bancorporation, Inc. is actively managing its capital. They are balancing the use of debt (deposits and FHLB advances) with equity funding through both organic earnings and capital return to shareholders. Year-to-date through September 30, 2025, the company repurchased $5.6 million of common stock, which is a direct action to reduce the share count and boost earnings per share. Plus, they paid a quarterly dividend of $0.15 per share in the quarter. This shows a commitment to returning capital, even while they are growing.

A major capital structure event is the all-stock merger with The Farmers Bancorp, announced in November 2025. This $82 million transaction is an equity-based acquisition, not debt-financed, and is expected to create a larger, $2.6 billion asset community bank. This move increases the overall scale and lending capacity, using equity as the currency for growth, which is a strong signal of management's confidence in the stock's valuation. Before you make an investment decision, you should defintely review the Mission Statement, Vision, & Core Values of Richmond Mutual Bancorporation, Inc. (RMBI).

Liquidity and Solvency

You need to know if Richmond Mutual Bancorporation, Inc. (RMBI) has the short-term cash to cover its obligations, and the answer is yes, but you have to look beyond the standard ratios. For a bank, liquidity is less about the current ratio and more about stable funding and capital strength. RMBI shows a healthy capital position and growing deposits, which are the real drivers of its liquidity.

The company is defintely well-capitalized, with a Tier 1 capital to total assets ratio of 10.85% as of September 30, 2025, which is comfortably above regulatory minimums. This strong capital buffer is your primary indicator of solvency, the long-term ability to meet all financial obligations, which ultimately supports short-term liquidity.

Assessing Richmond Mutual Bancorporation, Inc.'s Liquidity

When you look at a bank's financial health, traditional liquidity ratios like the Current Ratio (Current Assets / Current Liabilities) can be misleading. For RMBI, the reported Current Ratio is around 0.35. This low number is typical for a bank because their primary 'current liability' is customer deposits (liabilities due on demand or short notice), while their primary 'current asset' is long-term loans and securities. The Quick Ratio is similarly less informative for a bank's core business model.

Instead, we focus on the quality and stability of their funding base and the composition of their assets. Here's the quick math on their Q3 2025 position:

• Total Assets: $1.5 billion
• Total Deposits: $1.1 billion
• Stockholders' Equity: $140.0 million

Working Capital and Deposit Trends

Richmond Mutual Bancorporation, Inc.'s working capital trends are best viewed through the lens of deposit growth and asset composition. The company has seen a positive trend in its funding base, which is a major liquidity strength. Total deposits increased to $1,118,258,347 at September 30, 2025, up from $1,093,939,857 at the end of 2024.

This deposit growth of over $24 million year-to-date through Q3 2025 was primarily driven by increases in retail time deposits and interest-bearing demand accounts. Still, you should note that noninterest-bearing deposits-the cheapest form of funding-represented only 9.9% of total deposits, or $110.8 million, at the end of Q3 2025. This means a large portion of their funding is interest-sensitive, which is an ongoing cost pressure in a high-rate environment.

Cash Flow Dynamics and Near-Term Actions

The cash flow statement overview for the first nine months of 2025 shows a bank actively managing its balance sheet to generate returns for its shareholders. The net income for the first nine months was a solid $8,167,314, which forms the basis of cash flow from operations.

The investing and financing activities reveal clear strategic choices:

The bank is funding its loan growth by reducing its investment securities portfolio by $8.5 million and increasing cash and cash equivalents by $12.5 million as of Q3 2025. This indicates a strategic shift toward higher-yielding loans and a build-up of cash, which is a direct liquidity strength.

What this estimate hides, however, is the increase in nonperforming loans, which rose to $10.8 million (or 0.90% of total loans) in Q3 2025. This is a credit quality concern that could drain future operating cash flow if losses materialize. To be fair, the allowance for credit losses of $16.4 million seems adequate to cover the current nonperforming loans.

The most crucial near-term action is the announced merger with The Farmers Bancorp, which will create a combined entity with $2.6 billion in assets. This event will fundamentally reset the entire liquidity and capital structure, creating a much larger, more diverse institution. You can learn more about the strategic rationale here: Mission Statement, Vision, & Core Values of Richmond Mutual Bancorporation, Inc. (RMBI).

Your next step: Analyze the pro-forma balance sheet of the combined entity to see how the merger impacts the new bank's capital and funding mix.

Valuation Analysis

You're looking for a clear signal on Richmond Mutual Bancorporation, Inc. (RMBI) and here it is: the stock appears to be fairly valued to slightly undervalued based on its book value, but its low Price-to-Earnings (P/E) ratio suggests a potential discount relative to its earnings power.

The core takeaway is that the market is pricing RMBI at a premium for its dividend yield, but a discount for its balance sheet strength. This is a classic community bank scenario.

Key Valuation Multiples: P/E and P/B

When assessing a regional bank like Richmond Mutual Bancorporation, Inc., the Price-to-Book (P/B) ratio is defintely more critical than Enterprise Value-to-EBITDA (EV/EBITDA)-a metric which is not typically used for financial institutions. Banks are valued on their assets and capital, not just operating cash flow.

• Price-to-Earnings (P/E) (LTM): The trailing P/E is approximately 11.9x. This is low compared to the broader market, suggesting that the stock is trading at a discount for every dollar of earnings it generates.
• Price-to-Book (P/B): With a recent stock price of about $13.13 and a Book Value per share of $13.40 for the most recent quarter, the P/B ratio is approximately 0.98x. This means you are buying the company for 98 cents on the dollar of its net asset value. Trading below 1.0x is often a sign of undervaluation in the banking sector.
• Enterprise Value-to-EBITDA (EV/EBITDA): This metric is generally not reported or utilized for banks as their valuation is driven by interest income and balance sheet health, not EBITDA.

Here's the quick math: A P/B below 1.0x is a strong indicator of value, but that P/E of 11.9x suggests investors are cautious about future earnings growth, possibly due to the current interest rate environment and credit quality concerns like nonaccrual loans rising to $6.4 million as of September 30, 2025.

Dividend Profile and Stock Performance

Richmond Mutual Bancorporation, Inc. offers a compelling income opportunity, which helps support its floor price. The stock's performance over the last year shows it has been relatively stable, but still under pressure.

• Annual Dividend and Yield: The company pays an annual dividend of $0.60 per share, translating to a dividend yield of approximately 4.55%. That's a solid yield in this market.
• Payout Ratio: The payout ratio is a healthy 56.60% of earnings, which is sustainable and leaves room for capital retention or future dividend increases.
• 12-Month Stock Trend: The stock has traded in a 52-week range between a low of $11.37 and a high of $15.24. The current price of around $13.13 is near the middle of this range, but it is trading below its 50-day and 200-day moving averages (around $13.85 and $13.92, respectively), indicating a recent bearish technical trend.

The market is paying you to wait for a potential P/B reversion to 1.0x or higher. You can learn more about the bank's operational health in our full analysis: Breaking Down Richmond Mutual Bancorporation, Inc. (RMBI) Financial Health: Key Insights for Investors.

Analyst Consensus and Price Target

The Wall Street view is mixed but leans positive, which is typical for a stable regional bank. The lack of widespread coverage means the stock can be overlooked, which sometimes creates opportunity.

The overall analyst consensus rating for Richmond Mutual Bancorporation, Inc. is a 'Buy', though recent individual ratings have included a 'Hold' with a price target of $14.00. This target suggests a modest upside of about 6.6% from the recent $13.13 price. The implied upside is not massive, but it's a clear signal that analysts see the current price as a floor, not a ceiling.

The table below summarizes the key valuation metrics based on the latest available 2025 data:

Your next step should be to review the bank's asset quality, especially the nonaccrual loans, to ensure the P/B discount isn't hiding a deeper credit risk problem. Finance: cross-check the P/B ratio against the tangible common equity ratio by end of week.

Risk Factors

You're looking at Richmond Mutual Bancorporation, Inc. (RMBI) after a period of solid earnings growth, but a seasoned analyst knows that a bank's risks often lurk just beneath the surface of a positive income statement. The biggest near-term risks for RMBI fall into three buckets: credit quality, the complexity of a major merger, and the new regulatory compliance burden they now face. We need to map these risks to the clear actions you should consider for your portfolio.

Operational and Financial Risks: Credit Quality Pressure

While Richmond Mutual Bancorporation, Inc. (RMBI) has a strong capital position-its Tier 1 capital to total assets was a healthy 10.85% at September 30, 2025, well above regulatory minimums-we are seeing pressure on credit quality. The most telling sign is the surge in past-due loans. Accruing loans past due more than 90 days jumped to $4.4 million at the end of Q3 2025, a significant increase from $1.7 million at the end of 2024. That's a defintely sharp rise.

This increase is tied to a single, large exposure: one multi-family loan accounted for $2.4 million of that past-due balance, which tells you the risk isn't widely distributed, but concentrated. Nonaccrual loans (loans where the collection of interest or principal is doubtful) also rose to $6,381,000 at September 30, 2025, up from $5,063,000 at year-end 2024. Here's the quick math: the company's Allowance for Credit Losses (ACL) did increase to $16.4 million, or 1.37% of total loans, but the credit quality trend is still mixed and requires close monitoring.

Strategic and External Risks: Merger Integration and Market Valuation

The biggest strategic move is the announced all-stock merger with The Farmers Bancorp, valued at approximately $82 million, which will create a premier $2.6 billion asset community bank. This is a game-changer, but it brings major integration risks. The financial benefits, like the expected 35% EPS accretion for RMBI shareholders, are only realized if the integration goes smoothly, and frankly, mergers rarely do.

Plus, the external environment remains uncertain, with the CEO citing ongoing risks from inflation, rate pressures, and global tensions. On top of that, there's a valuation risk: the stock was recently trading at a premium of roughly 45% over the estimated Discounted Cash Flow (DCF) fair value of $9.24, which can limit near-term upside. You can read more about the players in the deal here: Exploring Richmond Mutual Bancorporation, Inc. (RMBI) Investor Profile: Who's Buying and Why?

• Failure to obtain regulatory or shareholder approvals for the merger.
• Inability to realize the full cost savings from the integration.
• Legal investigations into the merger process can create uncertainty.

Regulatory and Compliance Headwinds

A less visible but important risk is the increased regulatory burden. Richmond Mutual Bancorporation, Inc. (RMBI) ceased to qualify as an Emerging Growth Company (EGC) as of December 31, 2024. This means that for the 2025 fiscal year, they must comply with all the new accounting standards and reporting requirements applicable to larger public companies.

This transition increases compliance costs and complexity, and it demands more internal resources. It's not a catastrophic risk, but it's an operational friction point that can distract management and impact non-interest expense in the near term.

Next Step: Focus your attention on the Q4 2025 filing for any updates on the $2.4 million multi-family loan and the initial costs associated with the merger integration.

Growth Opportunities

You are looking at Richmond Mutual Bancorporation, Inc. (RMBI) right after a major strategic move, so the growth story is now centered on execution. The direct takeaway is that the recent merger with The Farmers Bancorp is projected to deliver significant near-term earnings growth, with an estimated 35% EPS accretion on a run-rate basis, following cost savings. This is a game-changer for a community bank.

The core of Richmond Mutual Bancorporation's future growth isn't just organic; it's being driven by a calculated acquisition that dramatically increases their scale and market reach. Announced in November 2025, the all-stock merger with The Farmers Bancorp is a transformational strategic initiative. This move immediately creates a premier community bank with $2.6 billion in total assets, nearly doubling the size of their balance sheet from the $1.5 billion reported in the third quarter of 2025.

Here's the quick math on the earnings estimate: Richmond Mutual Bancorporation's diluted earnings per share (EPS) for Q3 2025 was $0.37. The merger is expected to generate approximately 35% EPS accretion for shareholders upon full realization of anticipated cost savings, calculated from the annualized Q3 2025 results. This accretion is the clearest near-term earnings projection we have, and it signals a substantial jump in profitability once the integration is complete. Plus, the combined entity will operate a network of 24 branches across key markets in Central and East Central Indiana as well as Western and Central Ohio.

The key growth drivers moving forward are clear, and they are tied directly to this expanded footprint and enhanced capabilities. The new, larger bank will unlock higher lending limits, which is defintely crucial for competing for larger commercial loans in their strategic growth markets, including Columbus, Cincinnati/Dayton/Springfield, and Indianapolis.

• Expand lending limits and broader product offerings.
• Achieve 35% EPS accretion from merger cost synergies.
• Target economic expansion in Ohio and Indiana growth markets.
• Maintain conservative underwriting standards for stable credit quality.

Richmond Mutual Bancorporation's competitive advantage has always been its core banking model, focused on relationship-based lending, particularly in commercial real estate. Now, they couple that steady, conservative approach with the scale of a $2.6 billion asset institution. This combination of size and a disciplined, community-oriented focus provides a strong, defensible position against larger regional banks. You can review the foundational principles that guide their strategy here: Mission Statement, Vision, & Core Values of Richmond Mutual Bancorporation, Inc. (RMBI).

The company has already demonstrated operational strength, with net profit margins lifting to 23.7% over the last year, up from 20.9% the year prior. This margin strength, coupled with the projected merger synergies, paints a picture of a more efficient and profitable institution. What this estimate hides, however, is the execution risk inherent in integrating two banks-systems, personnel, and culture-but the financial incentive is too compelling to ignore.

The dividend per share also saw a boost in 2025, increasing by 7% to $0.15 per share, demonstrating a continued commitment to shareholder returns alongside the focus on growth. This is a signal of management confidence. The next step for you is to monitor the integration process closely, specifically looking for updates on the timing and realization of those anticipated cost savings.