Farmers & Merchants Bank, of Spokane Valley, posted record net income in 2003 for the seventh year in a row.


The banks net income climbed to $4.4 million last year, up 16 percent from 2002. Its total deposits rose 9.7 percent, to $269 million as of Dec. 31, while total assets jumped 10.2 percent to $304 million.


The banks loan portfolio increased 11.5 percent last year to $262 million. Also for 2003, the bank reported return on average assets of 1.52 percent, an improvement over 1.43 percent in 2002, and return on average equity of 15 percent, down slightly from 15.1 percent the previous year.


John Tombari, chief financial officer at Farmers & Merchants, says that the banks growth last year can be attributed to a number of factors, including shrinking interest rates and its opening of more bank branches here.


Farmers & Merchants recently opened branches near Wandermere Mall and Shadle Center, bringing the total number of branches it has here to 16, Tombari says. The bank plans to open another branch, at 509 N. Sullivan Road, in Spokane Valley, sometime later this year, he says.


Were expanding our footprint in Spokane County, he says.


The bank also is considering opening branches in the Tri-Cities, North Idaho, and Boise, Tombari says.


Farmers & Merchants, which increased its staff by about 15 percent last year, now employs some 137 people full time and plans to continue hiring this year, Tombari says.


Farmers & Merchants began offering Internet banking, online bill-paying options, and free-checking packages for small business last year, Tombari says. The bank will introduce other new products this year, he says.


Well be aggressively trying to expand our product mix to retail clientele, consumers, and small businesses, he says.


Tombari says Farmers & Merchants might begin offering a broader array of loan and deposit services, but declines to say what other services it could introduce this year.