Richmond Mutual Bancorporation, Inc. (RMBI): BCG Matrix [Dec-2025 Updated]

Richmond Mutual Bancorporation, Inc. (RMBI) is at a critical juncture in late 2025, facing a transformational merger while balancing its existing portfolio. We've mapped their key operations using the BCG Matrix to see where the real power lies: the Stars driving future growth from the announced merger and Cash Cows like the segment accounting for about 90% of total revenues providing stable funding. However, we also see clear Dogs in historical revenue diversification issues and significant Question Marks surrounding merger execution risk and rising nonperforming loans at 0.90%. Dive in to see the distilled analysis of RMBI's current strategic positioning before the new $2.6 billion asset bank takes shape.

Background of Richmond Mutual Bancorporation, Inc. (RMBI)

You're looking at the core structure of Richmond Mutual Bancorporation, Inc. (RMBI), which you know is the Maryland corporation trading on the NASDAQ under the ticker RMBI. Honestly, it's simpler than the ticker suggests; RMBI is the bank holding company for First Bank Richmond, headquartered right there in Richmond, Indiana. The roots of the bank go way back to 1887, when it first started as an Indiana state-chartered mutual savings and loan association.

What's key to understanding RMBI is its ownership structure. Unlike many publicly traded banks, Richmond Mutual Bancorporation, Inc. operates as a mutual holding company, meaning its depositors are its owners, which definitely aligns its strategy with customer interests. Operationally, First Bank Richmond serves individuals and small businesses across Indiana with eight branches, plus it has a presence in Ohio through five branches and a loan production office operating under the name Mutual Federal.

Looking at the most recent numbers as of late 2025, the balance sheet is holding steady. As of September 30, 2025, the total assets for Richmond Mutual Bancorporation, Inc. stood at $1.5 billion, with loans and leases, net of the allowance for credit losses, at $1.2 billion. Deposits were right around $1.1 billion at that time. The management team, led by Garry Kleer, has been focused on disciplined decisions, which seems to be paying off, as the annualized net interest margin hit 3.07% in the third quarter of 2025, up from 2.64% in the comparable quarter of 2024.

The biggest news shaping the near-term future for Richmond Mutual Bancorporation, Inc. happened in November 2025. The company announced a transformational strategic merger with The Farmers Bancorp. This deal is designed to create a premier community bank with total assets projected to reach $2.6 billion, expanding its branch network to 24 locations across key markets in Central and East Central Indiana, as well as Western Ohio. For Q3 2025, the reported net income was $3.6 million, translating to a diluted EPS of $0.37, showing strong performance leading into this major corporate action.

Richmond Mutual Bancorporation, Inc. (RMBI) - BCG Matrix: Stars

You're looking at the engine room of Richmond Mutual Bancorporation, Inc.'s current momentum, which, in BCG terms, aligns with the characteristics of a Star-a business segment operating in a high-growth market where it holds a strong relative market share, demanding significant investment to maintain that lead.

The most significant indicator of this high-potential growth trajectory is the announced strategic merger with The Farmers Bancorp. This deal is set to create a premier community bank with total assets reaching $2.6 billion, a substantial increase from Richmond Mutual Bancorporation, Inc.'s standalone total assets of $1.5 billion as of September 30, 2025. This scaling up is a clear investment in future market position.

The immediate financial performance in the third quarter of 2025 already demonstrates the kind of vigorous growth that characterizes a Star unit, even before the full merger synergies are realized. The core operational strength is evident in the Net Interest Income (NII), which is clearly leading the way.

Here are the key financial metrics from Q3 2025 that underscore this high-growth profile:

• Net Interest Income (NII) growth, up 19.7% year-over-year in Q3 2025.
• Expanded annualized Net Interest Margin (NIM) of 3.07% in Q3 2025.
• Diluted Earnings Per Share (EPS) growth of 54% year-over-year for Q3 2025.
• The merger is projected to deliver approximately 35% EPS accretion for Richmond Mutual Bancorporation, Inc. shareholders on a run-rate basis, using annualized results from the three months ended September 30, 2025.

The combination of strong organic growth and the transformative merger positions the combined entity for significant future cash generation, provided the high market share-or in this case, the newly combined market presence-is sustained until the market growth rate naturally slows. The merger itself, valued at approximately $82 million, is an investment designed to secure that leadership position, with an expected closing date in early Q2 2026.

You can see how these core performance indicators are accelerating when comparing the recent quarter to prior periods:

The strategy here is clear: invest heavily now, through the merger and continued operational focus, to solidify market leadership. If this combined entity maintains its success as the regional banking market matures, these Stars are definitely on the path to becoming the next generation of Cash Cows for Richmond Mutual Bancorporation, Inc. The current asset base of $1.5 billion, set to become $2.6 billion post-merger, is the platform consuming this cash to fuel that growth.

Richmond Mutual Bancorporation, Inc. (RMBI) - BCG Matrix: Cash Cows

You're looking at the core engine of Richmond Mutual Bancorporation, Inc. (RMBI), the business units that generate more cash than they consume. These are the established leaders in a mature space, and for RMBI, that stability is found in its traditional lending operations. This segment requires minimal heavy investment because the market isn't expanding rapidly, so the focus shifts to efficiency and milking the existing high market share for steady returns.

The foundation of this cash generation is the loan book. As of the third quarter of 2025, the loans and leases, net of the allowance for credit losses, stood firmly at approximately $1.2 billion. This figure has been remarkably consistent across the year, showing stability in the asset base that underpins the bank's primary business model. This stability is exactly what you want from a Cash Cow; it's not burning capital chasing uncertain growth.

The profitability derived from this stable asset base is clear in the revenue mix. For the first half of 2025, the Net Interest Income (NII) segment accounted for about 90% of total revenues. This heavy reliance on NII, which benefits from the current interest rate environment and a solid loan volume, confirms its status as the primary cash generator. For instance, in the third quarter of 2025, Net Interest Income before the provision for credit losses reached $11.3 million.

This consistent performance directly supports shareholder returns, which is the primary goal of managing a Cash Cow. Richmond Mutual Bancorporation, Inc. has maintained a consistent quarterly cash dividend of $0.15 per share, a policy reinforced at the start of 2025. The third quarter of 2025 saw net income of $3.6 million, easily covering these distributions and allowing for capital management activities.

Here's a quick look at the key metrics that define this cash-generating strength as of late 2025:

The capital position is robust, which is crucial for a mature business unit that needs to maintain, not aggressively grow, its position. While the outline mentions a CET1 ratio near 13% (a figure cited near the end of June 2025), the third quarter of 2025 showed the Tier 1 capital to total assets ratio at 10.85%, well above regulatory minimums. This strong capital base allows Richmond Mutual Bancorporation, Inc. to confidently distribute earnings while investing modestly to improve operational efficiency, rather than needing large capital injections for expansion.

To maximize the cash flow from these units, the strategy is about refinement, not reinvention. You want to 'milk' the gains passively, but smart management still looks for small efficiency gains. For example, the efficiency ratio improved to 68.5% during the second quarter of 2025, showing better cost control relative to revenue, which directly boosts the cash flow from this segment.

The characteristics supporting the Cash Cow classification include:

• Loan book size holding steady near $1.2 billion.
• Revenue stream dominated by NII at roughly 90%.
• Shareholder returns supported by a $0.15 quarterly dividend.
• Capital ratios, like the CET1 near 13%, providing a strong foundation.
• Muted growth prospects due to limited geographical expansion.

Richmond Mutual Bancorporation, Inc. (RMBI) - BCG Matrix: Dogs

You're looking at the units within Richmond Mutual Bancorporation, Inc. (RMBI) that fit the profile of a Dog: low market share in markets that aren't expanding quickly. These areas tie up capital without offering much return, so the strategy here is usually to minimize exposure or divest, since expensive fixes rarely work out.

The core issue for this segment of Richmond Mutual Bancorporation, Inc.'s business is the historical lack of success in diversifying revenue beyond Net Interest Income (NII). This reliance on the spread between what the bank earns on loans and pays on deposits means the business model is highly exposed to interest rate fluctuations. Honestly, the bank continues to generate the vast majority of its revenues from NII, showing a profile that's not expected to change much over the short to medium term.

This reliance is quantified by the performance of noninterest income streams, which remain a small percentage of total revenue. For the third quarter of 2025, the numbers tell a clear story about this lack of diversification. Here's the quick math for Q3 2025:

The limited geographical footprint in Indiana and Ohio restricts organic market growth, keeping the market share low in those specific regions. Richmond Mutual Bancorporation, Inc., through its parent company First Bank Richmond, operates a concentrated footprint. This limits the ability to capture new, high-growth markets, keeping these units as Dogs unless a major strategic shift occurs.

The current branch structure that defines this limited footprint is:

• Eight branches located in Indiana.
• Five branches and one loan production office located in Ohio.

Finally, the reliance on higher-cost funding sources further pressures profitability in these low-growth areas. Specifically, brokered time deposits represent a significant, more expensive portion of the funding base as of the end of Q3 2025. This funding choice is often used to meet immediate loan demand but carries a higher cost, which is a classic trap for a Dog segment.

The specific figures for this funding source in Q3 2025 were:

• Brokered time deposits totaled $248.3 million.
• This amount represented 22.2% of total deposits as of September 30, 2025.

This is a high-cost funding source that you want to see minimized in a low-growth, low-share business unit.

Richmond Mutual Bancorporation, Inc. (RMBI) - BCG Matrix: Question Marks

You're looking at the areas of Richmond Mutual Bancorporation, Inc. that are burning cash now but hold the promise of future market leadership-the classic Question Marks. These are units in high-growth markets where the company currently has a small footprint, demanding significant investment to capture share before they stagnate.

The most immediate, high-stakes Question Mark is the integration risk associated with the recently announced transformational strategic merger with The Farmers Bancorp. This all-stock transaction, valued at approximately $82 million, aims to create a premier community bank with $2.6 billion in assets and a 24-branch network spanning Indiana and Western/Central Ohio. The success hinges on execution; management projects a run-rate Earnings Per Share (EPS) accretion of approximately 35% for Richmond Mutual Bancorporation shareholders upon realizing cost savings. Following completion, existing Richmond Mutual Bancorporation shareholders are projected to own approximately 62% of the combined entity. The deal is expected to close in early Q2 2026.

Asset quality trends in Q3 2025 present a clear area requiring focused investment to prevent deterioration. Nonperforming Loans (NPLs) increased to $10.8 million as of September 30, 2025, representing 0.90% of total loans and leases. This is a notable jump from the $8.1 million reported in the preceding quarter. This shift pressured the Allowance for Credit Losses (ACL) coverage ratio, which fell to 152% from 201% in Q2 2025. You need to watch this trajectory closely; if NPLs continue to rise, the capital allocation strategy for this segment will need to pivot quickly.

The funding structure also highlights a potential area needing strategic attention, specifically the reliance on more rate-sensitive deposits. For the third quarter of 2025, noninterest-bearing deposits stood at $110.8 million, which was only 9.9% of total deposits, which themselves totaled $1.1 billion. This low proportion of low-cost funding puts pressure on the Net Interest Margin if deposit competition heats up, even though the margin did expand to 3.07% in Q3 2025.

Here's a quick look at how those asset quality and funding metrics shifted into Q3 2025:

The expansion into Ohio via the Mutual Federal division represents a geographic Question Mark. While the merger will formally integrate operations across Central and East Central Indiana and Western/Central Ohio, the existing Ohio presence is smaller and less established than the core Indiana base. Prior to the merger announcement, First Bank Richmond operated five full-service offices in Ohio (Piqua (2), Sidney (2), Troy (1)) plus a loan production office in Columbus. To turn this into a Star, significant investment is needed to rapidly grow market share in Ohio to match the scale and efficiency seen in the established Indiana footprint. The integration of Farmers Bancorp's operations, which also have an Ohio presence, will be key to achieving this scale.

You need to decide on heavy investment to drive market penetration in Ohio or risk these operations becoming Dogs as integration costs mount. Finance: draft the pro-forma capital impact of the $82 million merger structure by next Wednesday.