FARMERS & MERCHANTS BANCORP
                     REPORTS RECORD THIRD QUARTER EARNINGS


Kent  A. Steinwert, President and Chief Executive Officer of Farmers & Merchants
Bancorp,  announced  that  the  Company  earned  record net income for the third
quarter  ending September 30, 2006. The results represented THE 35TH CONSECUTIVE
QUARTER  that  Farmers  & Merchants Bancorp's net income increased over the same
period  the  prior  year.

Farmers  &  Merchants  Bancorp reported net income of $5,333,000 for the quarter
ending  September  30,  2006. Earnings per share of common stock outstanding for
the third quarter were $6.54, up 13.9% from the third quarter of the prior year.
In  addition, loans outstanding grew 9.6%, total core deposits, excluding public
time  deposits,  increased  5.3%,  and  total  assets  at  quarter  end  were
$1,415,813,000, up 9.5% over the third quarter of 2005. Return on average assets
for  the  quarter  was  1.54%,  and  return  on  average  equity  was  16.8%, an
improvement  of  108  basis points over the third quarter of the prior year. The
Company's  loan  quality has remained extremely high with non-performing assets,
as  of  September  30,  2006,  totaling  only  0.01%  of loans. In addition, the
Company's  loan  loss  reserve  is  1.76%  of  loans.

For  the nine month period ending September 30, 2006, net income was $15,364,000
and  earnings  per share of common stock outstanding were $18.77, an increase of
13.1%  over  the  prior  year.

Steinwert  stated,  "We are pleased with our third quarter results, particularly
given  the  pressures  that  are being placed on the net interest margins at all
banks.  Over  the  past  two  years,  as  market  interest  rates  increased
substantially,  management worked hard to reposition the Bank's balance sheet to
reduce  potential  exposure  to  net  interest  income in the event of a flat or
declining  rate  environment.  When  combined with other initiatives to increase
non-interest  revenues  and pursue operational efficiencies, these balance sheet
repositioning  strategies  should  help  us  achieve  our performance objectives
throughout  the remainder of 2006 and into 2007. Additionally, we are pleased to
announce that our 20th branch was opened during October. Located in the Vintners
Square  shopping center, this branch will allow us to better serve the expanding
consumer and small business markets in Lodi. Additional branches in Stockton and
Turlock  are  planned  in  the  near  future."



Farmers & Merchants Bancorp is the parent of Farmers & Merchants Bank of Central
California,  also  known as F&M Bank. Founded in 1916, the institution is a full
service  community  bank  and  proudly  serves California's Great Central Valley
through  20  branch  offices  conveniently  located  from Sacramento to Turlock.

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FORWARD LOOKING STATEMENTS

Statements  concerning  future performance, developments or events, expectations
for  growth  and  income  forecasts,  and  any other guidance on future periods,
constitute  forward-looking statements that are subject to a number of risks and
uncertainties.  Actual  results  may differ materially from stated expectations.
Specific factors include, but are not limited to, loan production, balance sheet
management,  expanded  net  interest  margin,  the  ability to control costs and
expenses,  interest  rate  changes  and  financial policies of the United States
government  and general economic conditions. Additional information on these and
other factors that could affect financial results are included in our Securities
and  Exchange Commission filings. The Company disclaims any obligation to update
any  such  factors  or  to publicly announce the results of any revisions to any
forward-looking  statements  contained  herein  to  reflect  future  events  or
developments.