Exhibit 99.1

FOR IMMEDIATE RELEASE	FOR FURTHER INFORMATION CONTACT:
January 24, 2023
Farmers and Merchants Bancshares, Inc.	Contact:     Mr. Gary A. Harris
4510 Lower Beckleysville Rd, Suite H	President & CEO
Hampstead, Maryland 21074	(410) 374-1510, ext.104

FARMERS AND MERCHANTS BANCSHARES, INC. REPORTS EARNINGS OF $8,090,127 OR $2.66 PER COMMON SHARE FOR THE YEAR ENDED DECEMBER 31, 2022

HAMPSTEAD, MARYLAND (January 24, 2023) – Farmers and Merchants Bancshares, Inc. (the “Company”) (OTC: FMFG), the parent of Farmers and Merchants Bank (the “Bank”), announced that net income for the year ended December 31, 2022 was $8,090,127, or $2.66 per common share (basic and diluted), compared to $8,149,606, or $2.70 per common share (basic and diluted), for the same period in 2021. The Company’s return on average equity during the year ended December 31, 2022 was 16.03% compared to 14.85% for the same period in 2021. The Company’s return on average assets during the year ended December 31, 2022 was 1.13% compared to 1.16% for the same period in 2021. Income from Paycheck Protection Program (“PPP”) loans added approximately $181,000 to net income for the year ended December 31, 2022 compared to $802,000 for the same period in 2021.

Net income for the three months ended December 31, 2022 was $2,014,282, or $0.66 per common share (basic and diluted), compared to $1,965,265, or $0.65 per common share (basic and diluted), for the fourth quarter of 2021.

Net interest income for the year ended December 31, 2022 was $1,248,391 higher than for the same period in 2021 due to a $22.0 million increase in average interest earning assets to $686.7 million for the year ended December 31, 2022 as compared to $664.7 million for the same period in 2021, and an increase in the taxable equivalent net yield on average net interest earning assets to 3.54% for the year ended December 31, 2022 from 3.47% for the year ended December 31, 2021. The taxable equivalent yield on total average interest-earning assets decreased 4 basis points to 3.85% for the year ended December 31, 2022 from 3.89% for the same period in 2021 primarily due to the aforementioned decline in PPP revenue. This decrease was offset by a 13 basis point decrease in the cost of deposits and borrowings to 0.41% for the year ended December 31, 2022 from 0.54% for the same period in 2021. Provision for loan losses totaled $475,000 for the year ended December 31, 2022, compared to $330,000 for the same period in 2021.

Noninterest income increased by $128,024 for the year ended December 31, 2022 when compared to the same period in 2021 primarily as a result of a $151,206 increase in the gain on sale of SBA loans and a $673,483 net gain from insurance proceeds related to storm damage suffered by its Upperco location during the third quarter of 2022, offset by a $696,470 decrease in mortgage banking revenue reflecting a decline in refinances due to rising interest rates. Noninterest expense was $1,238,681 higher in the year ended December 31, 2022 when compared to the same period in 2021 due primarily to a $730,008 increase in salaries and benefits and a $451,083 increase in other expenses. The increase in salaries and benefits was due to normal annual salary increases as well as the hiring of several new employees. The increase in other expenses was due primarily to third party fees related to the hiring of new employees. Income taxes increased by $52,213 during the year ended December 31, 2022 when compared to the same period in 2021 due to a decrease in the amount of nontaxable income included in pretax income year-over-year. The effective tax rate increased to 23.50% during the year ended December 31, 2022 compared to 22.99% during the same period last year.

Total assets were $718 million at December 31, 2022 compared to $717 million at December 31, 2021. Loans increased to $517 million at December 31, 2022 from $482 million at December 31, 2021 despite a $9 million decrease in PPP loans. Investments in debt securities decreased to $147 million at December 31, 2022 from $171 million at December 31, 2021 due primarily to a $25 million increase in the unrealized loss on available for sale (“AFS”) securities. Deposits decreased to $624 million at December 31, 2022 from $626 million at December 31, 2021. Federal Home Loan bank advances increased to $20 million at December 31, 2022 from $5 million at December 31, 2021. Despite the Company’s strong earnings, the book value of the Company’s common stock decreased to $15.56 per share at December 31, 2022, compared to $18.64 per share at December 31, 2021 due to the decline in the market value of the Company’s AFS investment portfolio as a result of the significant rise in interest rates over the last year. Changes in the market value of the AFS investment portfolio, net of income taxes, are reflected in the Company’s equity but are not included in the income statement. Because the Company has the intent and ability to hold the investments to maturity, no actual losses in the AFS investment portfolio are anticipated and the declines in market value are considered temporary. The decline in the market value of the AFS investment portfolio did not have an impact on regulatory capital because the Bank elected many years ago to not include in the calculation of regulatory capital changes in the market value of the AFS investment portfolio regardless of whether they are positive or negative.

Gary A. Harris, President & CEO, commented “I’d like to wish long-time President & CEO Jim Bosley a happy retirement and thank him again for leading the Bank for over 27 years. Jim left on a high note with net income for 2022 just short of our record earnings set last year. We are also pleased that our loan portfolio grew by 7.2% during 2022 despite PPP loan forgiveness. We look forward to 2023 despite rising rates on deposits which will put pressure on our net interest margin.”

About the Company

The Company is a financial holding company and the parent of the Bank. The Bank was chartered in Maryland in 1919 and has over 100 years of service to the community. The Bank serves the deposit and financing needs of both consumers and businesses in Carroll and Baltimore Counties along the Route 30, Route 795, Route 140, and Route 26 corridors. The main office is located in Upperco, Maryland, with seven additional branches in Owings Mills, Hampstead, Greenmount, Reisterstown, Westminster, and Eldersburg. Certain broker-dealers make a market in the common stock of Farmers and Merchants Bancshares, Inc., and trades are reported through the OTC Markets Group’s Pink Market under the symbol “FMFG”.

Forward-Looking Statements

The statements contained herein that are not historical facts are forward-looking statements (as defined by the Private Securities Litigation Reform Act of 1995) based on management's current expectations and beliefs concerning future developments and their potential effects on the Company. Such statements involve inherent risks and uncertainties, many of which are difficult to predict and are generally beyond the control of the Company. There can be no assurance that future developments affecting the Company will be the same as those anticipated by management. These statements are evidenced by terms such as “anticipate,” “estimate,” “should,” “will,” “expect,” “believe,” “intend,” and similar expressions. Although these statements reflect management’s good faith beliefs and projections, they are not guarantees of future performance and they may not prove true. These projections involve risk and uncertainties that could cause actual results to differ materially from those addressed in the forward-looking statements. For a discussion of these risks and uncertainties, see the section of the periodic reports filed by Farmers and Merchants Bancshares, Inc. with the Securities and Exchange Commission entitled “Risk Factors”.

Farmers and Merchants Bancshares, Inc. and Subsidiaries

Consolidated Balance Sheets

(Unaudited)

	December 31,			December 31,
	2022			2021
Assets
Cash and due from banks	$	6,414,822		$	25,258,932
Federal funds sold and other interest-bearing deposits		848,715			1,203,174
Cash and cash equivalents		7,263,537			26,462,106
Certificates of deposit in other banks		100,000			350,000
Securities available for sale, at fair value		126,314,449			149,237,916
Securities held to maturity, at cost		20,508,997			21,851,975
Equity security, at fair value		489,145			543,605
Restricted stock, at cost		1,332,500			675,400
Mortgage loans held for sale		428,355			126,500
Loans, less allowance for loan losses of $4,150,198 and $3,650,268		516,920,540			482,011,334
Premises and equipment, net		6,186,594			6,259,421
Accrued interest receivable		1,815,784			1,609,063
Deferred income taxes, net		8,392,658			2,177,450
Other real estate owned, net		1,242,365			1,242,365
Bank owned life insurance		14,585,342			11,556,163
Goodwill and other intangibles, net		7,042,752			7,051,080
Other assets		5,587,654			5,522,877
	$	718,210,672		$	716,677,255
Liabilities and Stockholders' Equity
Deposits
Noninterest-bearing	$	126,695,349		$	124,175,615
Interest-bearing		496,915,775			502,239,055
Total deposits		623,611,124			626,414,670
Securities sold under repurchase agreements		5,175,303			5,414,026
Federal Home Loan Bank of Atlanta advances		20,000,000			5,000,000
Long-term debt, net of issuance costs		15,095,642			16,978,905
Accrued interest payable		349,910			295,910
Other liabilities		6,203,730			5,952,286
		670,435,709			660,055,797
Stockholders' equity
Common stock, par value $.01 per share, authorized 5,000,000 shares; issued and outstanding 3,071,214 in 2022 and 3,037,137 shares in 2021		30,712			30,372
Additional paid-in capital		29,549,914			28,857,422
Retained earnings		35,300,166			29,128,600
Accumulated other comprehensive loss		(17,105,829	)		(1,394,936	)
		47,774,963			56,621,458
	$	718,210,672		$	716,677,255

Farmers and Merchants Bancshares, Inc. and Subsidiaries

Consolidated Statements of Income

(Unaudited)

	Three Months Ended December 31,					Twelve Months Ended December 31,
	2022		2021			2022			2021
Interest income
Loans, including fees	$	5,904,409	$	5,663,588		$	22,565,034		$	23,491,614
Investment securities - taxable		811,146		544,129			2,981,300			1,511,970
Investment securities - tax exempt		140,160		148,962			570,655			611,323
Federal funds sold and other interest earning assets		63,001		17,753			152,664			65,496
Total interest income		6,918,716		6,374,432			26,269,653			25,680,403
Interest expense
Deposits		404,371		408,539			1,375,691			1,997,873
Securities sold under repurchase agreements		4,210		6,498			12,768			44,628
Federal Home Loan Bank advances and long-term debt		214,666		192,256			757,699			762,798
Total interest expense		623,247		607,293			2,146,158			2,805,299
Net interest income		6,295,469		5,767,139			24,123,495			22,875,104
Provision for (recovery of) loan losses		380,000		(100,000	)		475,000			330,000
Net interest income after provision for (recovery of) loan losses		5,915,469		5,867,139			23,648,495			22,545,104
Noninterest income
Service charges on deposit accounts		203,457		201,271			777,901			724,086
Mortgage banking income		18,214		206,109			214,043			910,513
Bank owned life insurance income		49,444		55,380			229,179			229,966
Fair value adjustment of equity security		431		(5,140	)		(62,093	)		(15,354	)
Gain on call of debt security		-		-			-			9,190
Gain on insurance proceeds, net		673,483		-			673,483			-
Gain on sale of SBA loans		-		-			158,123			6,917
Other fees and commissions		73,976		70,815			303,302			300,596
Total noninterest income		1,019,005		528,435			2,293,938			2,165,914
Noninterest expense
Salaries		2,208,551		1,848,017			7,865,194			7,214,871
Employee benefits		430,321		418,565			1,798,150			1,718,465
Occupancy		219,988		211,670			890,926			948,757
Furniture and equipment		248,967		197,267			891,250			775,829
Other		1,106,578		1,083,695			3,921,760			3,470,677
Total noninterest expense		4,214,405		3,759,214			15,367,280			14,128,599
Income before income taxes		2,720,069		2,636,360			10,575,153			10,582,419
Income taxes		705,787		671,095			2,485,026			2,432,813
Net income	$	2,014,282	$	1,965,265		$	8,090,127		$	8,149,606
Earnings per common share - basic and diluted	$	0.66	$	0.65		$	2.66		$	2.70