First Farmers and Merchants Corporation

First Farmers and Merchants Corporation is a Tennessee corporation incorporated on March 31, 1982, whose only direct subsidiary as of December 31, 2015 was First Farmers and Merchants Bank, a Tennessee state-chartered bank. Management evaluates the Company's financial condition in terms of the Bank's operations within its service area in Middle Tennessee. The Bank's loan portfolio consists of commercial, commercial and residential real estate, and retail installment loans, which primarily originate within its service area. Deposits are the Bank's primary source of funds and consist of checking accounts, regular savings deposits, negotiable order of withdrawal accounts, money market accounts and market rate certificates of deposit. Deposits are solicited from individuals and businesses in the Bank's service area, state and local entities and, to a lesser extent, United States government entities and other depository institutions. In addition to lending and deposit activities, the Bank maintains a trust department providing fiduciary and investment management services for individual and commercial clients, with account types including personal trusts, endowments, individual retirement accounts, pensions and custody. All of the Company's assets are located in the United States and all revenues from external customers originate within the United States. The Bank's net income depends primarily on net interest income, the difference between interest income earned on loans, investment assets and other interest-earning assets and interest paid on deposits and other interest-bearing liabilities.